Registration No.
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-------------------------------------
FORM S-8 REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
-------------------------------------
U.S. INDUSTRIES, INC.
---------------------
(Exact name of registrant as specified in its charter)
Delaware 22-3369326
-------- ----------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
101 Wood Avenue South Iselin, New Jersey 08830
- ---------------------------------------- -----
(Address of Principal Executive Offices) (Zip Code)
SUNLITE CASUAL FURNITURE, INC.
RETIREMENT SAVINGS & INVESTMENT PLAN
(Full title of the plan)
GEORGE H. MACLEAN
Senior Vice President and General Counsel
U.S. Industries, Inc.
101 Wood Avenue South Iselin, New Jersey 08830
(Name and address of agent for service)
(908) 767-0700
(Telephone number, including area code, of agent for service)
<TABLE>
CALCULATION OF REGISTRATION FEE
Title of Proposed Maxi- Proposed Maxi-
Securities mum Offering mum Aggregate Amount of
to be Amount to be Price Per Offering Registration
Registered Registered Share (2) Price Fee
- -----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock,
par value $.01 157,270 $36.625 $5,760,000 $1,745.28
per share (1)
- -----------------------------------------------------------------------------
<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) Determined in accordance with Rule 457(c) based on the average of the high
and low sales prices on the New York Stock Exchange on February 28, 1997.
</FN>
</TABLE>
- --------------------------------------------------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 3. Incorporation of Documents by Reference
- ------- ---------------------------------------
The following documents and portions of documents filed by Registrant or
by the Plan pursuant to the Securities Act of 1933 (the "Act") and the
Securities Exchange Act of 1934 (the "Exchange Act") are incorporated herein by
reference:
(a) Registrant's annual Report on Form 10-K for the fiscal year ended
September 28, 1996.
(b) Description of the Common Stock at page 75 of Registrant's Information
Statement, dated April 21, 1995 attached as Annex A to Registrant's Registration
Statement on Form 10, effective April 21, 1995.
(c) Registrant's Report on Form 8-K dated December 12, 1996, Registrant's
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act filed
December 16, 1996, Registrant's Report on Form 10-Q dated December 28, 1996 and
all documents filed pursuant to Section 13(a) or 15(d) of the Exchange Act by
Registrant since September 28, 1996 and by Registrant or the Plan pursuant to
Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act on or subsequent to the
date of this Registration Statement and prior to the filing of a post-effective
amendment which indicates that all securities being offered pursuant hereto have
been sold or which deregisters all such securities then remaining unsold, also
shall be deemed to be a part hereof from the date of filing of such documents.
Item 6. Indemnification of Directors and Officers.
- ------- ------------------------------------------
In accordance with Section 145 of the Delaware General Corporation Law
("DGCL"), which provides for the indemnification of directors, officers and
employees under certain circumstances, Article XIV ("Article XIV") of the
Registrant's By-Laws grants the Registrant's directors, officers and employees a
right to indemnification for all expenses, liabilities and losses relating to
civil, criminal, administrative or investigative proceedings to which they are a
party (i) by reason of the fact that they are or were directors, officers or
employees of Registrant or (ii) by reason of the fact, while they are or were
directors, officers or employees of Registrant, they are or were serving at the
request of Registrant as directors, officers, members, employees, fiduciaries or
agents of another corporation, partnership, joint venture, trust or enterprise.
Article XIV of the By-Laws further provides for the mandatory advancement of
expenses incurred by officers and directors in defending such proceedings in
advance of their final disposition upon delivery to Registrant by the
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<PAGE>
indemnitee of an undertaking to repay all amounts so advanced if it is
ultimately determined that such indemnitee is not entitled to be indemnified
under Article XIV. Registrant may not indemnify or make advance payments to any
person in connection with proceedings initiated against Registrant by such
person without the authorization of the Board of Directors, except with respect
to counterclaims, cross-claims, third-party claims or as otherwise ordered by a
court of competent jurisdiction.
In addition, Article XIV provides that directors and officers therein
described shall be indemnified to the fullest extent permitted by Section 145 of
the DGCL, or any successor provisions or amendments thereunder. In the event
that any such successor provisions or amendments provide indemnification rights
broader than permitted prior thereto, Article XIV allows such broader
indemnification rights to apply retroactively with respect to any predating
alleged action or inaction and also allows the indemnification to continue after
an indemnitee has ceased to be a director or officer of the corporation and to
inure to the benefit of the indemnitee's heirs, executors and administrators.
Article XIV further provides that the right to indemnification is not
exclusive of any other right which any indemnitee may have or thereafter acquire
under any statute, the Certificate of Incorporation or By-Laws, any agreement or
vote of stockholders or disinterested directors or otherwise, and allows
Registrant to indemnify and advance expenses to any person whom the corporation
has the power to indemnify under the DGCL or otherwise.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted for directors and officers and controlling persons pursuant
to the foregoing provisions, Registrant has been advised that in the opinion of
the Commission such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable.
Registrant's By-Laws authorize Registrant to purchase insurance for
directors, officers and employees of Registrant, and persons who serve at the
request of Registrant as directors, officers, members, employees, fiduciaries or
agents of other enterprises against any expense, liability or loss incurred in
such capacity, whether or not Registrant would have the power to indemnify such
persons against such expense or liability under the By-Laws. Registrant intends
to maintain insurance coverage for its officers and directors as well as
insurance coverage to reimburse Registrant for potential costs of its corporate
indemnification of directors and officers.
Item 8. Exhibits.
- ------- ---------
4.1 Form of amended and restated Certificate of
Incorporation of Registrant incorporated by
II-2
<PAGE>
reference to Exhibit 3.1(a) of Registrant's Form 10 as filed April
20, 1995.
4.2 Amended and Restated By-Laws of Registrant incorporated by reference
to Exhibit 3.2 to Registrant's Form 10 as filed April 20, 1995.
4.3 Specimen form of certificate representing shares of Common Stock of
Registrant incorporated by reference to Exhibit 4.1 to Registrant's
Form 10 as filed April 20, 1995.
4.4 Sunlite Casual Furniture, Inc. Retirement Savings &
Investment Plan.
5.1 Registrant undertakes to submit the Plan and any amendment thereto
to the Internal Revenue Service ("IRS") in a timely manner and will
make all changes required by the IRS in order to qualify the Plan.
23.1 Consent of Ernst & Young LLP, independent auditors,
New York, New York.
23.2 Consent of Price Waterhouse, independent accountants,
Morristown, New Jersey.
23.3 Consent of Deloitte & Touche LLP, independent auditors,
New York, New York.
24.1 Power of Attorney
Item 9. Undertakings.
- ------- -------------
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement: (i) to include
any prospectus required by Section 10(a)(3) of the Securities Act of 1933; (ii)
to reflect in the prospectus any fact or event arising after the effective date
of the registration statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate, represent a fundamental change
in the information set forth in the registration statement: (iii) to include any
material information with respect to the plan of distribution not previously
disclosed in the registration statement or any material change to such
information in the registration statement; provided, however, that paragraphs
(a)(1)(i) and (a)(1)(ii) of this section do not apply if the registration
statement is on Form S-3, Form S-8 or Form F-3, and the information required to
be included in a post effective amendment by those paragraphs is contained in
periodic reports filed with or furnished to the Commission by the registrant
II-3
<PAGE>
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.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to 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.
(h) 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.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in Iselin, New Jersey on March 4, 1997.
U.S. INDUSTRIES, INC.
(Registrant)
By: /s/ George H. MacLean
------------------------
George H. MacLean, Senior
Vice President, General
Counsel and Secretary
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<PAGE>
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
Signature Title Date
- --------- ----- ----
* Chairman of the March 4, 1997
- ------------------------ Board and Chief
David H. Clarke Executive Officer
(Principal Executive
Officer)
* Director, President March 4, 1997
- ------------------------ and Chief Operating
John G. Raos Officer
* Director, Senior Vice March 4, 1997
- ------------------------ President and Chief
Frank R. Reilly Financial Officer
(Principal Financial
Officer)
* Director March 4, 1997
- ------------------------
Brian C. Beazer
* Director March 4, 1997
- ------------------------
John J. McAtee, Jr.
Director
- -------------------------
The Hon. Charles H. Price II
Director
- -------------------------
Sir Harry Solomon
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<PAGE>
* Director March 4, 1997
- ------------------------
Royall Victor III
* Director March 4, 1997
- ------------------------
Mark Vorder Bruegge
* Vice President- March 4, 1997
- ------------------------ Corporate Controller
James O'Leary (Principal Accounting
Officer)
-----------------
* By /s/ George H. MacLean March 4, 1997
------------------------
George H. MacLean
Attorney-in-fact
Pursuant to the requirements of the Securities Act of 1933, the Benefits
Administration Committee has duly caused this Registration Statement to be
signed on behalf of the Plan by the undersigned, thereunto duly authorized, in
the City of Iselin, and State of New Jersey on March 4, 1997.
SUNLITE CASUAL FURNITURE, INC.
RETIREMENT SAVINGS & INVESTMENT PLAN
By: /s/ Dorothy E. Sander
----------------------------
Name: Dorothy E. Sander
Title: Committee Member
II-7
<PAGE>
EXHIBIT INDEX
Exhibit
No.
- -------
4.1 Form of amended and restated Certificate of Incorporation of
Registrant incorporated by reference to Exhibit 3.1(a) of Registrant's
Form 10 as filed April 20, 1995.
4.2 Amended and Restated By-Laws of Registrant incorporated by reference
to Exhibit 3.2 to Registrant's Form 10 as filed April 20, 1995.
4.3 Specimen form of certificate representing shares of Common Stock of
Registrant incorporated by reference to Exhibit 4.1 to Registrant's
Form 10 as filed April 20, 1995.
4.4 Sunlite Casual Furniture, Inc. Retirement Savings & Investment Plan.
5.1 Registrant undertakes to submit the Plan and any amendment thereto to
the Internal Revenue Service ("IRS") in a timely manner and will make
all changes required by the IRS in order to qualify the Plan.
23.1 Consent of Ernst & Young LLP, independent auditors, New York, New
York.
23.2 Consent of Price Waterhouse, independent accountants, Morristown,
New Jersey.
23.3 Consent of Deloitte & Touche LLP, independent auditors, New York,
New York.
24.1 Power of Attorney
II-8
EXHIBIT 4.4
SUNLITE CASUAL FURNITURE, INC.
RETIREMENT SAVINGS & INVESTMENT PLAN
(Effective March 2, 1997)
<PAGE>
TABLE OF CONTENTS
ARTICLE I
Definitions
1.1 "Account"....................................................... 1
1.2 "Affiliate"..................................................... 1
1.3 "Appropriate Notice" ........................................... 1
1.4 "Beneficiary"................................................... 1
1.5 "Board" or "Board of Directors"................................. 1
1.6 "Code".......................................................... 1
1.7 "Committee"..................................................... 1
1.8 "Company"....................................................... 1
1.9 "Compensation" ................................................. 1
1.10 "Compensation Deferral Contributions".......................... 2
1.11 "Compensation Deferral Contributions Account".................. 2
1.12 "Effective Date"............................................... 2
1.13 "Eligible Employee"............................................ 2
1.14 "Employee" .................................................... 2
1.15 "Employee Contributions"....................................... 2
1.16 "Employee Contributions Account"............................... 3
1.17 "Employer"..................................................... 3
1.18 "Employer Matching Contributions".............................. 3
1.19 "Employer Matching Contributions Account"...................... 3
1.20 "Employer Securities".......................................... 3
1.21 "Enrollment Date".............................................. 3
i
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1.22 "Enrollment Period"............................................ 3
1.23 "ERISA"........................................................ 3
1.24 "Hour of Service".............................................. 3
1.25 "Initial Enrollment Date"...................................... 4
1.26 "Investment Fund".............................................. 4
1.27 "Investment Manager"........................................... 4
1.28 "Leased Employee".............................................. 5
1.29 "Leave of Absence"............................................. 5
1.30 "Member"....................................................... 5
1.31 "Parental Leave"............................................... 5
1.32 "Plan"......................................................... 6
1.33 "Plan Year".................................................... 6
1.34 "Prior Plan"................................................... 6
1.35 "Prior Plan Account"........................................... 6
1.36 "Required Beginning Date"...................................... 6
1.37 "Retirement"................................................... 6
1.38 "Rollover Contribution"........................................ 6
1.39 "Rollover Contribution Account"................................ 6
1.40 "Service"...................................................... 6
1.41 "Suspense Account"............................................. 6
1.42 "Total and Permanent Disability"............................... 7
1.43 "Trustee"...................................................... 7
1.44 "Trust Fund"................................................... 7
1.45 "Valuation Date"............................................... 7
ii
<PAGE>
ARTICLE II
Eligibility and Membership
2.1 Members of Prior Plans.......................................... 7
2.2 Eligible Employees on and after the Effective Date.............. 7
2.3 Completion of Appropriate Notice................................ 7
2.4 Elections Upon Becoming A Member................................ 8
2.5 Beneficiary Designation......................................... 8
2.6 Transfers to or from Non-Covered Status......................... 8
2.7 Rollover Contributions From Other Plans......................... 9
ARTICLE III
Compensation Deferral Contributions
3.1 Compensation Deferral Contributions............................. 9
3.2 Changes and Suspension of Contributions......................... 10
3.3 Transfer of Contributions to Trustee............................ 10
ARTICLE IV
Limitations on, and Distribution of,
Excess Compensation Deferral
Contributions and Excess Employer Match-
ing Contributions of Highly Compensated
Employees
4.1 Limitations...................................................... 11
4.2 Control of Contributions and Distribution of Excess............ 12
4.3 Limitation of Annual Additions.................................. 15
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ARTICLE V
Employer Matching Contributions
5.1 Amount of Employer Matching Contributions....................... 18
5.2 Treatment of Forfeitures........................................ 18
5.3 Transfer of Contributions to Trustee............................ 19
ARTICLE VI
Accounts
6.1 Maintenance of Accounts......................................... 19
6.2 Valuations...................................................... 19
ARTICLE VII
Vesting of Accounts
7.1 Employer Matching Contributions Account......................... 20
7.2 Other Accounts.................................................. 20
7.3 Earlier Vesting in Employer Matching Contributions
Accounts........................................................ 20
7.4 Forfeitures..................................................... 20
ARTICLE VIII
Investment of Accounts
8.1 Investment of Accounts Other Than Employer Matching
Contributions Accounts.......................................... 21
8.2 Redirection of Future Contributions............................. 22
8.3 Reinvestment of Prior Contributions............................. 23
8.4 Investment of Employer Matching Contributions Accounts.......... 23
8.5 Statements of Accounts And Confirmation of Investment
Directions...................................................... 23
iv
<PAGE>
8.6 Crediting of Accounts........................................... 23
8.7 Correction of Errors............................................ 24
ARTICLE IX
Withdrawals and Loans During Employment
9.1 Withdrawal Options.............................................. 24
9.2 Hardship Withdrawals............................................ 25
9.3 Values.......................................................... 26
9.5 Loans........................................................... 27
ARTICLE X
Distribution
10.1 Amount of Distribution......................................... 28
10.2 Notice of Options and Normal Form of Distribution.............. 29
10.3 Alternate Form of Distribution................................. 30
10.4 Identity of Payee.............................................. 31
10.5 Non-alienation of Benefits..................................... 31
10.6 Qualified Domestic Relations Order............................. 32
10.7 Commencement of Benefits....................................... 32
10.8 Annuities...................................................... 32
10.9 Spousal Consent................................................ 34
ARTICLE XI
Administration of the Plan
11.1 Plan Administrator............................................. 35
11.2 Board of Directors............................................. 36
11.3 Appointment of the Committee................................... 36
11.4 Compensation, Expenses......................................... 36
v
<PAGE>
11.5 Committee Actions, Agents...................................... 36
11.6 Committee Meetings............................................. 37
11.7 Authority and Duties of the Committee.......................... 37
11.8 Personal Liability............................................. 37
11.9 Dealings Between the Committee and Individual Members.......... 38
11.10 Information To Be Supplied by the Employer.................... 38
11.11 Records....................................................... 38
11.12 Fiduciary Capacity............................................ 38
11.13 Fiduciary Responsibility...................................... 38
11.14 Claim Procedure............................................... 39
ARTICLE XII
Operation of the Trust Fund
12.1 Trust Fund..................................................... 40
12.2 Trustee........................................................ 41
12.3 Investment Manager............................................. 41
12.4 Purchase and Holding of Securities............................. 41
12.5 Voting of Employer Securities.................................. 41
12.6 Disbursement of Funds.......................................... 42
ARTICLE XIII
Amendment, Termination and Merger
13.1 Right to Amend................................................. 42
13.2 Suspension or Termination...................................... 43
13.3 Merger, Consolidation of Transfer.............................. 43
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<PAGE>
ARTICLE XIV
Miscellaneous
14.1 Uniform Administration......................................... 43
14.2 Payment Due an Incompetent..................................... 44
14.3 Source of Payments............................................. 44
14.4 Plan Not a Contract of Employment.............................. 44
14.5 Applicable Law................................................. 44
14.6 Unclaimed Amounts.............................................. 44
ARTICLE XV
Top Heavy Provisions
15.1 Application.................................................... 45
15.2 Special Top Heavy Definitions.................................. 45
15.3 Special Top Heavy Provisions................................... 52
15.4 Effect of Change in Applicable Legislation or
Regulation.......................................................... 55
vii
<PAGE>
ARTICLE I
Definitions
As used herein, unless otherwise defined or required by the context, the
following words and phrases shall have the meanings indicated. Some of the words
and phrases used in the Plan are not defined in this Article I, but, for
convenience are defined as they are introduced into the text.
1.1 "Account" means a Member's Employee Contributions Account,
Compensation Deferral Contributions Account, Rollover Contribution Account,
Employer Matching Contributions Account or Prior Plan Account as the context
requires.
1.2 "Affiliate" means any company which is related to the Employer as a
member of a controlled group of corporations in accordance with Section 414(b)
of the Code, as a trade or business under common control in accordance with
Section 414(c) of the Code or members of an affiliated service group as defined
under Section 414(m) of the Code.
1.3 "Appropriate Notice" means the written form, electronic procedure or
other method prescribed by the Committee to convey information for a particular
purpose.
1.4 "Beneficiary" means the person or persons designated by the Plan or by
a Member under Section 2.5 (Beneficiary Designation) to receive benefits payable
under the Plan as a result of the Member's death.
1.5 "Board" or "Board of Directors" means the Board of Directors of the
Employer.
1.6 "Code" means the Internal Revenue Code of 1986, as amended from time
to time and references to sections thereof shall be deemed to include any such
sections as amended, modified or renumbered.
1.7 "Committee" means the Benefits Administration Committee appointed in
accordance with Section 11.3 (Appointment of Committee).
1.8 "Company" means the corporation that owns 100% of the capital stock of
the Employer or any person, firm, corporation or partnership which may succeed
to its business.
1.9 "Compensation" means with respect to a Plan Year, the sum of the
amount reported by the Employer to the Internal Revenue Service on Form W-2 as
the Member's compensation for such
1
<PAGE>
calendar year, the amount of any Compensation Deferral Contributions made on
such Member's behalf to the Plan and the amount, if any, contributed to a
cafeteria plan that is excluded from gross income pursuant to Section 125 of the
Code; but exclusive of termination or severance pay, prizes, awards, grievance
settlements, overseas cost of living allowances, relocation allowances, mortgage
assistance, executive perquisites, stock options, and such other extraordinary
items or remuneration as the Committee shall determine from time to time
pursuant to such uniform and nondiscriminatory rules as it shall adopt. On and
after January 1, 1989 the Compensation of each Employee taken into account under
the Plan for any Plan Year shall not exceed $200,000 as thereafter adjusted for
inflation in accordance with Section 415(d) of the Code. For Plan Years
beginning after 1993 the Compensation of each Employee taken into account under
the Plan for any such Plan Year shall not exceed $150,000 as thereafter adjusted
for inflation in accordance with Section 401(a)(17)(B) of the Code.
1.10 "Compensation Deferral Contributions" means contributions made by the
Employer pursuant to an election by the Member to reduce the cash compensation
otherwise currently payable to such Member by an equivalent amount, in
accordance with the provisions of Section 3.1 (Compensation Deferral
Contributions).
1.11 "Compensation Deferral Contributions Account" means the separate
account maintained for a Member to record such Member's share of the Trust Fund
attributable to Compensation Deferral Contributions made on such Member's
behalf.
1.12 "Effective Date" means March 2, 1997, the date that the Plan became
effective.
1.13 "Eligible Employee" means an Employee who is employed on the
Effective Date or who (i) has attained age 21 and (ii) has worked, at least
1,000 Hours of Service during a consecutive twelve-month period, excluding an
individual who is covered by a collective bargaining agreement between the
Employer and any union unless participation by such employee in the Plan has
been agreed to by the parties to such agreement.
1.14 "Employee" means a person (but not including a person acting only as
a director) who is employed by the Employer. Leased Employees shall also be
treated as Employees for purposes of this Plan unless: (i) such Leased Employees
are covered by a Plan described in Code Section 414(n)(5) and (ii) such Leased
Employees constitute less than Twenty Percent (20%) of the Employer's non-highly
compensated workforce as defined in Code Section 414(n)(5)(c).
1.15 "Employee Contributions" means after tax contributions that were made
by a Member to a Prior Plan.
2
<PAGE>
1.16 "Employee Contributions Account" means the separate account
maintained for a Member to record such Member's share of the Trust Fund
attributable to the Member's Employee Contributions.
1.17 "Employer" means Sunlite Casual Furniture, Inc.
1.18 "Employer Matching Contributions" means the Employer matching
contributions made to the Trust Fund pursuant to Article V (Employer Matching
Contributions).
1.19 "Employer Matching Contributions Account" means the separate Account
maintained for a Member to record such Member's share of the Trust Fund
attributable to Employer Matching Contributions made on such Member's behalf.
1.20 "Employer Securities" means the Common Stock of U.S. Industries,
Inc., a Delaware Corporation.
1.21 "Enrollment Date" means the first day of each month in
the Plan Year.
1.22 "Enrollment Period" means the period commencing on an Enrollment Date
and ending on the next following Enrollment Date.
1.23 "ERISA" means Public Law No. 93-406, the Employee Retirement Income
Security Act of 1974, as amended from time to time.
1.24 "Hour of Service" means each hour for which an Employee is paid, or
entitled to payment, or receives earned income from an Employer or an Affiliate:
(a) for performance of duties;
(b) on account of a period of time which no duties were performed,
provided that except in the case of a Leave of Absence, no more than 501
Hours of Service shall be credited for any single continuous period during
which an Employee performs no duty, and provided that no Hours of Service
shall be credited for periods of time in respect of which an Employee
receives severance pay or for payments made or due under a plan maintained
solely for the purpose of complying with applicable workers' compensation,
unemployment compensation or disability insurance laws, or for
reimbursement of medical expenses; and
(c) for which back pay, irrespective of mitigation of damages, is
awarded or agreed to by the Employer provided that Hours of Service
credited under (a) or (b) shall not be credited under (c).
3
<PAGE>
Hours of Service credited to an Employee for the performance of duties
will be credited to the computation period in which the duties are performed.
The determination of Hours of Service for reasons other than the performance of
duties shall be made in accordance with the provisions of Labor Department
Regulations Section 2530.200b-2(b), and Hours of Service shall be credited to
the computation periods to which the award or agreement pertains. Except in the
case of a Leave of Absence, not more than 501 Hours of Service shall be credited
for any continuous period during which an Employee performs no duty or, in the
case of service required to be credited for payments of back pay awarded or
agreed to, for a period during which an employee did not or would not have
performed duties.
To the extent not credited above, during a Leave of Absence an Employee
shall be credited with a number of Hours of Service for each week of such Leave
of Absence equal to the Employee's weekly average number of Hours of Service
scheduled for the six-week period immediately preceding such Leave of Absence.
In any case in which an individual becomes an Employee upon the
acquisition of all or a portion of the business of his or her former employer by
the Employer or an Affiliate, whether by merger, acquisition of assets or stock,
or otherwise, his or her service with his or her predecessor employer shall be
included in determining his or her Hours of Service if, and to the extent that,
such service is required to be credited hereunder (A) by section 414(a) of the
Code and any regulations promulgated thereunder, (B) by the terms of the
agreement pursuant to which the business of such former employer was acquired by
the Employer or an Affiliate, or (C) by vote of the Board of Directors.
1.25 "Initial Enrollment Date" means the earliest date following the
Effective Date set by the Committee for Eligible Employees to apply to become
Members of the Plan.
1.26 "Investment Fund" means the investment choices described in Section
8.1 (Investment of Accounts Other than Employer Matching Contributions
Accounts).
1.27 "Investment Manager" means the individual and/or other entity
appointed in accordance with Section 12.3 (Investment Manager) who has
acknowledged in writing that such individual is a fiduciary with respect to the
Plan and who is:
(a) registered as an investment adviser under the Investment
Advisers Act of 1940, or
(b) a bank, as defined in such Act, or
(c) an insurance company qualified to manage, assign or dispose of
assets of pension plans.
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1.28 "Leased Employee" shall mean any person who pursuant to an agreement
between the Employer and any other person has performed services for the
Employer or any related person as defined in Code Section 414(n)(6) under the
primary direction and control of the Employer or such related person on a
substantially full time basis for a period of at least one year.
1.29 "Leave of Absence" means an absence or interruption of service
approved by the Committee under uniform and nondiscriminatory rules and
procedures. Members on leave of absence for service in the Armed Forces of the
United States, however, shall be deemed to have been on Leave of Absence,
provided they return to service with an Employer within the required time
limitations set forth in the then applicable laws governing reemployment rights
of persons inducted, or who have enlisted, in the Armed Forces.
1.30 "Member" means an Eligible Employee who has become a member of the
Plan in accordance with Article II (Eligibility and Membership). Each Member
shall continue to be such until the later of the date such Member ceases to be
an Eligible Employee or such Member's Accounts have been completely distributed.
1.31 "Parental Leave" means a period not in excess of two (2) years
commencing after December 31, 1984 during which an individual is absent from
work for any period:
(a) by reason of the pregnancy of the individual,
(b) by reason of the birth of a child of the individual,
(c) by reason of the placement of a child with the individual in
connection with the adoption of such child by such individual, or
(d) for purposes of caring for such child for a period beginning
immediately following such birth or placement.
An absence from work shall not be a Parental Leave unless the Employee furnishes
the Plan Administrator such timely information as may reasonably be required to
establish that the absence from work was for one of the reasons specified in
this Section 1.31 and the number of days for which there was such an absence.
Nothing contained herein shall be construed to establish an Employer policy of
treating a Parental Leave as a Leave of Absence.
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1.32 "Plan" means Sunlite Casual Furniture, Inc. Retirement Savings &
Investment Plan as set forth herein or as amended from time to time.
1.33 "Plan Year" means the calendar year.
1.34 "Prior Plan" means an employee benefit plan qualified under Section
401(a) of the Code all or part of the assets of which are transferred to the
Plan in a transaction which meets the requirements of Regulation 1.414(l) of the
Code.
1.35 "Prior Plan Account" means the separate account maintained for a
Member to record such Member's share of the Trust Fund attributable to employer
contributions to the plans described herein as Prior Plans.
1.36 "Required Beginning Date" means April 1 of the year following the
Plan Year in which occurs the later of the date that the Member terminates
employment or the date on which the Member attains the age of 70-1/2 years.
1.37 "Retirement" means a Member's normal, early or deferred retirement
whichever shall apply to the Member under the provisions of the Employer's
pension plan applicable to such Member, or the termination of employment of a
Member on or after such Member's attainment of age 65.
1.38 "Rollover Contribution" means an amount which is transferred from
another plan to this Plan, in accordance with the provisions of Section 2.7
(Rollover Contribution From Other Plans).
1.39 "Rollover Contribution Account" means the separate Account maintained
for a Member to record such Member's share of the Trust Fund attributable to any
Rollover Contribution made to the Plan on his behalf.
1.40 "Service" means the period of employment beginning on the first day
the Eligible Employee performs duties for the Employer or an Affiliate and
ending on the day of quit, retirement, discharge or death, two years after the
commencement of absence on account of Parental Leave, or one year after an
absence for any other reason. All prior periods of employment with the Employer
or an Affiliate, and breaks in employment of less than one year shall be
included in Service. If a break in employment of not more than two years is on
account of Parental Leave not more than one year of Service shall be credited to
an Eligible Employee for a period of Parental Leave.
1.41 "Suspense Account" means the separate account main- tained for a
Member who had monies credited to such account
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pursuant to Section 4.3 (Limitation of Annual Additions), reflecting the current
dollar value of such credit.
1.42 "Total and Permanent Disability" means permanent incapacity which
results in a Member being unable to engage in regular employment or occupation
by reason of any medically demonstrable physical or mental condition acceptable
to the Committee on a nondiscriminatory basis and which would entitle the Member
to benefits under the Employer's long-term disability plan, if any, or to Social
Security benefits as evidenced by a disability award letter. However, no Member
shall be deemed to be disabled if such incapacity (a) resulted from or consists
of habitual drunkenness or addiction to narcotics, or (b) was incurred, suffered
or occurred while the Member was engaged in, or resulted from having engaged in,
a criminal enterprise, or (c) was intentionally self-inflicted.
1.43 "Trustee" means the corporate trustee appointed from time to time by
the Company to administer the Trust Fund in accordance with Section 12.2
(Trustee).
1.44 "Trust Fund" means the trust fund established in accordance with
Section 12.1 (Trust Fund) from which benefits provided under this Plan will be
paid.
1.45 "Valuation Date" means the last business day of each calendar month
on which the New York Stock Exchange is open for trading.
ARTICLE II
Eligibility and Membership
2.1 Members of Prior Plans. Each person who was a member of a Prior Plan
shall become a member of the Plan on the effective date of the transaction
referred to in Section 1.34.
2.2 Eligible Employees on and after the Effective Date. On and after the
Effective Date an Eligible Employee may elect to become a Member on the Initial
Enrollment Date or any Enrollment Date thereafter. Notwithstanding the
foregoing, a former employee who is reemployed as an Eligible Employee following
a termination of employment and who, prior to termination, satisfied the
conditions for membership in the Plan, shall be eligible to become a Member of
the Plan immediately upon reemployment, subject to such advance notice
procedures as the Committee shall prescribe.
2.3 Completion of Appropriate Notice. In order to become a Member on any
Enrollment Date, an Eligible Employee must give the
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Appropriate Notice to the Committee at least 30 days (or such other period as
the Committee may prescribe) prior to that Enrollment Date.
2.4 Elections Upon Becoming A Member. An Eligible Employee, in giving the
Appropriate Notice specified in Section 2.3, shall (a) authorize the Employer to
reduce current compensation for Compensation Deferral Contributions pursuant to
Section 3.1 (Compensation Deferral Contributions ), (b) make an investment
election from among those options enumerated in Section 8.1 (Investment of
Accounts other Than Employer Matching Contributions Accounts), and (c) designate
a Beneficiary in accordance with Section 2.5 (Beneficiary Designation). Any such
payroll authorization, investment election or Beneficiary designation shall
remain in effect until changed by giving the Appropriate Notice to the Committee
subject to the provisions of the Plan.
2.5 Beneficiary Designation. Each Member shall designate a Beneficiary by
giving the Appropriate Notice to the Committee. The designated Beneficiary may
be an individual, estate or trust; however, if the Member is married at the time
of such Member's death, such Member's surviving spouse shall automatically be
such Member's sole Beneficiary unless the spouse has consented in writing in
accordance with Section 10.9 (Spousal Consent) to a designation of a different
Beneficiary. If more than one individual or trust is named, the Member shall
indicate the shares and/or precedence of each individual or trust so named. Any
Beneficiary so designated may be changed by the Member at any time (subject to
his spouse's consent, if applicable) by giving the Appropriate Notice to the
Committee.
In the event that no Beneficiary has been designated or that no designated
Beneficiary survives the Member, the following Beneficiaries (if then living)
shall be deemed to have been designated in the following priority: (a) spouse,
(b) children, including adopted children, in equal shares, (c) parents, in equal
shares, or the Member's surviving parent, if only one parent survives, and (d)
Member's estate.
2.6 Transfers to or from Non-Covered Status. If a Member ceases to meet
the definition of Eligible Employee as set forth in Section 1.13 (Eligible
Employee) but continues to be an Employee or an employee of an Affiliate, such
Member's right to make or have contributions made on such Member's behalf to the
Plan shall be suspended. If during the period of suspension, a Member's
employment with the Employer or an Affiliate terminates for any reason, there
shall be a distribution of such Member's Accounts in accordance with the
provisions of Article X (Distribution).
If and when the suspended Member again becomes an Eligible Employee, such
Member may resume having Compensation Deferral
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Contributions made on such Member's behalf as of the second Enrollment Date
following the month in which the Appropriate Notice is given to the Committee.
2.7 Rollover Contributions From Other Plans. An Eligible Employee or an
individual who meets the definition of Eligible Employee in Section 1.13 except
for the age or service requirements, who is in receipt of a distribution which
is eligible to be "rolled over" to a qualified plan in accordance with
applicable Code sections may, in accordance with and subject to such rules and
procedures approved by the Committee, transfer all or part of such distribution
into the Plan; provided, that distributions which are so transferred to the Plan
shall consist only of cash and that such transfer shall be in conformity with
requirements set forth in the Code.
Upon approval by the Committee, the amount transferred to the Plan shall
be deposited in the Trust Fund in cash and shall be credited to a Rollover
Contribution Account.
If a Rollover Contribution is made on behalf of an individual who has not
yet become a Member, such individual shall be deemed a Member upon the
establishment of the Rollover Contribution Account; however, participation in
the Plan shall be limited to the Rollover Contribution Account until the other
requirements for membership under this Article II are fulfilled.
ARTICLE III
Compensation Deferral Contributions
3.1 Compensation Deferral Contributions. Each Member who is an Eligible
Employee may elect to have the Employer make Compensation Deferral Contributions
not to exceed $9,500 per year (subject to adjustment for inflation in accordance
with Section 415(d) of the Code) to the Plan on such Member's behalf to be
credited to such Member's Compensation Deferral Contributions Account, in which
case the cash compensation otherwise payable by the Employer to the Member shall
be reduced by an amount equal to the Compensation Deferral Contributions so
made. Subject to the limitations prescribed in Section 4.1 the amount of
Compensation Deferral Contributions in any payroll period shall be in whole
percentages from 1% to 17% of the Member's Compensation as the Member shall
designate (or such greater or lesser percentages as the Committee may from time
to time prescribe for the Plan).
The foregoing notwithstanding during the 'make up period,' as defined
below, a former Member (a 'Veteran') who is reemployed after a period of
military service may elect to have the Employer make additional Compensation
Deferral Contributions to the Plan
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on such Veteran's behalf, the total of which may not exceed the maximum
Compensation Deferral Contributions that the Veteran could have elected to have
made if no military leave had occurred. For the purposes of calculating the
amount of such additional Compensation Deferral Contributions the Veteran's
Compensation during such leave of absence shall be deemed to have been the
Veteran's annual rate of compensation at the time the military leave of absence
commenced (the 'Deemed Compensation Rate') and the 'make up period' during which
such additional Compensation Deferral Contributions may be elected shall be
equal to the lesser of five years or three times the period of the military
leave of absence. Such additional Compensation Deferral Contributions in any
payroll period shall be in whole percentages of the Veteran's current payroll
and shall not exceed the maximum amount that could have been deferred at the
Deemed Compensation Rate. In the event that the additional Compensation Deferral
Contributions to the Plan on a Veteran's behalf that are authorized by this
paragraph exceed the limitations set forth in Article IV of the Plan or
otherwise conflict with provisions of the Code or ERISA, such limitations or
conflicts shall be ignored to the extent permitted by Code Section 414(u).
3.2 Changes and Suspension of Contributions. Compensation Deferral
Contributions made on a Member's behalf may be increased or decreased or
suspended effective on the second Enrollment Date following the month in which
the Appropriate Notice is given to the Committee. A Member who has suspended
Compensation Deferral Contributions may resume having such contributions made on
his or her behalf commencing on the second Enrollment Date following the month
in which the Appropriate Notice is given to the Committee.
3.3 Transfer of Contributions to Trustee. Contributions made under this
Article III will be transferred to the Trustee by the 15th day of the month
following the month in which the contributions are withheld from the Member's
Compensation and/or in which the Member's cash compensation is reduced; provided
that all Compensation Deferral Contributions for a Plan Year shall be
transferred to the Trustee not later than 30 days after the end of the Plan
Year.
ARTICLE IV
Limitations on, and Distribution of, Excess Compensation
Deferral Contributions and Excess Employer Matching Contri-
butions of Highly Compensated Employees
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4.1 Limitations. The Committee in its sole discretion shall separately
limit the amount of Compensation Deferral Contributions and Employer Matching
Contributions made on behalf of each "Highly Compensated Employee" (as defined
below) for each Plan Year to insure that neither the Deferral Percentage nor the
Contributions Percentage (each as defined below and referred to herein as the
"Percentage") exceed the greater of (X) 125 percent of the Percentage in the
preceding Plan Year of all other eligible employees or, alternatively, (Y) the
Percentage in the preceding Plan Year of all other eligible employees plus 2
percentage points and the actual Percentage for the Highly Compensated Employees
is not more than two times the actual Percentage in the preceding Plan Year of
all other eligible employees.
Additionally, Employer Matching Contributions shall not in any event
discriminate in favor of Highly Compensated Employees.
For purposes of this Section, the term "Deferral Percentage" with respect
to any Plan Year means the Compensation Deferral Contributions for the Plan Year
divided by Compensation.
For purposes of this Section, the term "Contributions Percentage" with
respect to any Plan Year means the Employer Matching Contributions for the Plan
Year divided by Compensation.
For the purposes of this Section, the term "Highly Compensated Employee"
with respect to any Plan Year means an Eligible Employee or former Eligible
Employee who performed services during the Plan Year for which the determination
is being made and:
(a) at any time during such Plan Year or preceding Plan Year was a
5-percent owner of the Employer (as defined for top-heavy plans under Code
Sec. 416(1); or
(b) earned $80,000 or more in the preceding Plan Year (subject to
adjustment for inflation in accordance with Section 415(d) of the Code) in
annual Compensation from the Employer.
(1) For the purposes of this Section, the term "Compensation" means Compensation
within the meaning of Code Section 415(c)(3), including elective or salary
reduction contributions to a cafeteria plan, cash or deferred arrangement or tax
sheltered annuity.
(2) For the purpose of this Section the term "Employer" shall also include all
other entities aggregated with the Employer under the requirements of Code
Section 414(b), (c), (m) and (o).
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For purposes of this Section, the Employer is permitted to determine
whether Members are in the category of Highly Compensated Employees or other
Eligible Employees based on the Member's Compensation for the immediately
preceding Plan Year or on estimated Compensation for the Current Plan Year in
accordance with uniform and nondiscriminatory rules whenever information
regarding actual Compensation for the Plan Year is not reasonably available at
the time the amount of a contribution hereunder is determined or limited.
For purposes of this Section the definition of "Compensation Deferral
Contributions" and "Employer Matching Contributions" shall include Compensation
Deferral Contributions and Employer Matching Contributions made under any other
plan that is aggregated with this Plan for purposes of Sections 401(a)(4) or
410(b) (other than Section 410(b)(2)(A)(ii)) of the Code and if any such plan is
permissively aggregated with this Plan for the purposes of Section 401(k) of the
Code, the plans so aggregated must also satisfy Section 401(a)(4) and 410(b) as
if they were a single plan. Further, for the purposes of this Section,
Compensation Deferral Contributions made on behalf of each Highly Compensated
Employee shall be determined by treating all cash or deferred arrangements under
which each such Highly Compensated Employee is eligible as a single arrangement.
4.2 Control of Contributions and Distribution of Excess.
(a) Rules For Compensation Deferral Contributions.The Committee may, in
accordance with uniform and nondiscriminatory rules it establishes from time to
time, require that Members who are among the Highly Compensated Employees for
the Plan Year make Compensation Deferral elections following and/or preceding
the completion of such elections by all other Eligible Employees and the
Committee may (X) limit the amount by which each Member who is among the Highly
Compensated Employees may elect to reduce his or her Compensation, and (Y)
subject to Section 402(g) of the Code permit each other Eligible Employee to
elect to reduce his or her Compensation within higher limits than those for
Highly Compensated Employees.
In the event that it is determined prior to the close of any Enrollment
Period that the amount of Compensation Deferral Contributions to be made with
respect to such Enrollment Period or Employer Matching Contributions in respect
thereof would cause the limitation contained in this Section to be exceeded for
the Plan Year in which such Enrollment Period occurs, the amount of Compensation
Deferral Contributions allowed to be made on behalf of Highly Compensated
Employees for such Enrollment Period shall be reduced. The Highly Compensated
Employees to whom the reduction is applicable, and the amount of the excess
Compensation Deferral Contributions, shall be determined by reducing the actual
Deferral Contributions of the Highly Compensated Employee
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<PAGE>
or Employees with the highest actual Deferral Contributions to the extent
required to--
(i) enable the arrangement to satisfy the limita-
tion set forth in Section 4.1 above; or
(ii) cause such Highly Compensated Employee's or Employees' actual
Deferral Compensation to equal the Deferral Compensation of the Highly
Compensated Employee or Employees with the next highest actual Deferral
Compensation.
The "leveling" process described in paragraph (i) or (ii) shall be
repeated until the limitations set forth in this Section are satisfied.
If the Committee determines that the limitations contained in this Section
have not been met for any Plan Year, the Committee may return the excess
Compensation Deferral Contributions of Members who are Highly Compensated
Employees (calculated in the manner set forth above) to such Members within the
12-month period beginning after the last day of the Plan Year for which such
contributions were made. The amount of such excess Compensation Deferral
Contributions shall be adjusted to reflect any income or loss allocable to such
excess during the Plan Year determined in accordance with the alternative method
set forth in Reg. Section 1.401(k)-1(f)(4)(ii)(c) and also from the end of the
Plan Year to the date of distribution determined in accordance with the safe
harbor method set forth in Reg. Section 1.401(k)- 1(f)(4)(2)(d).
For the purpose of this Section, if the Deferral Percentage of a Highly
Compensated Employee has been determined by combining the contributions and
compensation of only family members who are Highly Compensated Employees without
regard to family aggregation, then the excess Deferral Contributions for the
family unit shall be allocated among the family members in proportion to the
contribution of each family member that has been combined.
Alternatively, if the Deferral Percentage of a Highly Compensated Employee
has been determined by combining the contributions and compensation of all
family members, then the reduction in the Deferral Percentage of the family
group using the method described in this Section shall not be reduced below the
Deferral Percentage for the non-highly paid members of the family group and the
excess Compensation Deferral Contributions for the family unit shall be
allocated among the Highly Paid family members in proportion to their
contributions.
(b) Rules for Company Matching Contributions. In the event that it is
determined prior to the close of any Enrollment Period that the amount of
Company Matching Contribu-
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tions to be made with respect to such Enrollment Period would cause the
limitation contained in this Section to be exceeded for the Plan Year in which
such Enrollment Period occurs, the amount of Company Matching Contributions
allowed to be made on behalf of Highly Compensated Employees for such Enrollment
Period shall be reduced. The Highly Compensated Employees to whom the reduction
is applicable, and the amount of the excess shall be determined by reducing the
Company Matching Contributions of the Highly Compensated Employee or Employees
with the highest actual Matching Contributions to the extent required to--
(i) enable the arrangement to satisfy the limitation
set forth in Section 4.1 above; or
(ii) cause such Highly Compensated Employee's or Employees' actual
Matching Contributions to equal the Matching Contributions of the
Highly Compensated Employee or Employees with the next highest
actual Matching Contributions.
The "leveling" process described in paragraph (i) or (ii) shall be
repeated until the limitations set forth in this Section are satisfied.
Excess Aggregate Contributions plus any income and minus any losses
allocable thereto, shall be forfeited, if not vested, or if not forfeitable,
distributed, no later than the last day of each Plan Year to those Participants
to whose Individual Accounts such Excess Aggregate Contributions were allocated
for the preceding Plan Year. Company Matching Contributions which are forfeited
shall be credited against Company Matching Contributions required to be made to
Participant's accounts in the Plan Year following the Plan Year that the excess
Company Matching contributions were allocated to Participant's accounts
provided, however, any excess which has not been so credited within two and one
half months after the end of the Plan Year shall be immediately refunded to the
Employer.
For the purposes of this Section, if the Contributions Percentage of a
Highly Compensated Employee has been determined by combining the contributions
and compensation of only family members who are Highly Compensated Employees
without regard to family aggregation, then excess Aggregate Contributions for
the family unit shall be allocated among the family members in proportion to the
share of each family member that has been combined.
Alternatively, if the Contributions Percentage of a Highly Compensated
Employee has been determined by combining the contributions and compensation of
all family members, then the reduction in the Contributions Percentage of the
family group using the method described in this Section shall not be reduced
below
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<PAGE>
the Contributions Percentage for the non-highly paid members of the family group
and the excess Aggregate Contributions for the family unit shall be allocated
among the Highly Paid family members in proportion to their shares.
(c) Multiple Use Limitations. If the actual Deferral Percentage, the
actual Contribution Percentage, and the sum of the two percentages for the group
of Highly Compensated Employees in the Plan exceed the limits set forth in
Regs.1.401(m)-2(b) then in such case the required reduction of multiple use of
the alternate limitation shall be accomplished through reduction of the actual
Deferral Percentage for all Highly Compensated Employees eligible to participate
in the Plan in accordance with the procedures prescribed in Regs. 1.401(m)-2(b)
which are incorporated herein by reference.
4.3 Limitation of Annual Additions.
(a) Notwithstanding anything herein to the contrary, in no event
shall the Annual Additions (as hereinafter defined) with respect to any
Member in any Plan Year exceed the Maximum Annual Addition. A Member's
"Maximum Annual Additions" means the lesser of (i) 25% of the Member's
compensation reported on Form W-2 (after December 31, 1997, compensation
for the purposes of Annual Additions shall also include elective or salary
reduction contributions to a cafeteria plan, cash or deferred compensation
arrangement or tax sheltered annuity) or (ii) the dollar limit in effect
for such Plan Year in accordance with Section 415(c)(1)(A) of the Code
($30,000 as hereafter adjusted for inflation in accordance with Section
415(d) of the Code),
(b) For purposes of this Section 4.3 the term
"Annual Additions" means the sum for any Plan Year of
(i) Compensation Deferral Contributions made in accordance
with Section 3.1 (Compen- sation Deferral Contributions),
(ii) Employer Matching Contributions including forfeitures as
applied in accordance with Section 5.1 (Amount of Employer Matching
Contributions) and Section 5.2 (Treatment of Forfeitures).
(iii) The amount of annual additions (within the meaning of
Section 415(c)(2) of the Code) under all other qualified defined
contribution plans of the Employer or an Affiliate.
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<PAGE>
(c) If the Member's Annual Additions exceed the Maximum Annual
Additions limitations in accordance with this Section 4.3, such amounts
shall not be contributed to the Trust or, if contributed by or on behalf
of a Member under the Plan shall be reduced in the following order, but
only to the extent necessary to meet the limitations: (i) Compensation
Deferral Contributions and (ii) Employer Matching Contributions in respect
of such reduced Compensation Deferral Contributions.
(d) Combined Fraction.
(i) Notwithstanding the foregoing, for any Plan Year beginning
before January 1, 2000, if a Member is a participant in any
qualified defined benefit plan maintained by an Employer or an
Affiliate, the sum of the "Defined Benefit Plan Fraction" (as
defined below) and the "Defined Contribution Plan Fraction" (as
defined below) for such Member shall not exceed 1.0 (called
"Combined Fraction"). If for any Plan Year the Combined Fraction of
a Member exceeds 1.0 after application of provisions for limitation
of benefits under all such qualified defined benefit plans, the
Maximum Annual Additions of such Member shall be reduced as provided
in Section 4.3(c) to the extent necessary to reduce the Combined
Fraction of such Member to 1.0.
(ii) The "Defined Benefit Plan Fraction" applicable to a
Member for any Plan Year is a fraction, the numerator of which is
the sum of the Projected Annual Benefit of the Member under all of
the qualified defined benefit Plans maintained by the Employer or an
Affiliate, (whether or not terminated) in which such Member
participates (determined as of the close of the Plan Year) and the
denominator of which is the lesser of (A) the product of 1.25
multiplied by the maximum dollar limitation on a Member's Projected
Annual Benefit if the plan provided the maximum benefit allowable
under Section 415(b) of the Code for such Plan Year, or (B) the
product of 1.4 multiplied by 100% of the Member's Highest Average
Compensation.
Notwithstanding the above, if the Member was a participant in
one or more defined benefit plans maintained by the Employer which
were in existence on July 1, 1982, the denominator of this fraction
will not be less than 1.25 multiplied by the sum of the annual
benefits under such plans which the Member had accrued as of the
later of September 30, 1983, or the last limitation year beginning
before January 1, 1983. The preceding sentence applies only if
defined benefit plans individually and in the aggregate satisfied
the
16
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requirements of Section 415 of the Code as in effect at
the end of the 1982 limitation year.
(iii) The "Defined Contribution Plan Fraction" applicable to a
Member for any Limitation Year is a fraction, the numerator of which
is the sum of the Member's Annual Additions as of the close of such
Plan Year for that Plan Year and for all prior Plan Years under all
of the defined contribution plans maintained by an Employer or an
Affiliate in which Member participates, and the denominator of which
is the lesser of the following amounts (determined for such Plan
Year and for each prior Plan Year of service with the Employer or
any Affiliate regardless of whether a plan was in existence during
those years): (A) the product of 1.25 multiplied by the dollar
limitation in effect under Code Section 415(c)(1)(A) for the Plan
Year (determined without regard to the special dollar limitation for
employee stock ownership plans), or (B) the product of 1.4
multiplied by twenty-five percent of the Member's Compensation for
the Plan Year.
(e) Definitions.
(i) "Highest Average Compensation" means the average of a
Member's high three consecutive Plan Years (determined as of the
close of the Plan Year) of employment with the Employer or the
actual number of years of employment for those Members who are
employed for less than three consecutive years with the Employer.
(ii) "Projected Annual Benefit" means the annual benefit a
Member would receive from employer contributions under a defined
benefit plan, adjusted, in the case of any benefit payable in a form
other than a single life annuity or a qualified joint and survivor
annuity, to the actuarial equivalent of a single life annuity,
assuming (A) the Member continues employment until reaching the
plan's normal retirement age (or the Member's current age, if
later), (B) compensation remains unchanged and (C) all other
relevant factors used to determine benefits under the plan remain
constant in the future.
(f) In the event that, notwithstanding the foregoing provisions of
this Section 4.3, the limitations with respect to Annual Additions
prescribed hereunder are exceeded with respect to any Member and such
excess arises as a consequence of reasonable error in estimating a
Member's compensation or such other circumstances as the Secretary of
Treasury shall permit, the Employer Matching Contributions
17
<PAGE>
portion of such excess shall be held in a Suspense Account and, if such
Member remains a Member, shall be used to reduce Employer Matching
Contributions for such Member for the succeeding Plan Years, and, if such
Member ceases participating in the Plan, shall be used to reduce Employer
Matching Contributions for all Members in the Plan Year of cessation and
succeeding Plan Years, as necessary. Compensation Deferral Contributions
which have been made to the Trust and are reduced under Section 4.3(c)
shall be refunded to the Member as soon as administratively convenient.
Any Employer Matching Contributions including Forfeitures remaining upon
Plan Termination which cannot be allocated to Members in accordance with
the foregoing in the Plan Year of termination of the Plan shall be
returned to the Employer.
(g) For purposes of this Section 4.3, the standard of control for
determining if a company is an Affiliate under Section 414(b) and 414(c)
of the Internal Revenue Code shall be deemed to be "more than 50%" rather
than "at least 80%."
ARTICLE V
Employer Matching Contributions
5.1 Amount of Employer Matching Contributions. The Employer shall make
matching contributions to the Plan, with respect to each payroll period on
behalf of each Member who is an Eligible Employee, equal to 50% (or such greater
percentage, not exceeding 100%, as the Board may from time to time authorize) of
that portion of the Member's Compensation Deferral Contributions which do not
exceed 6% (or such other percentage as the Board may from time to time permit)
of Compensation in such payroll period. The Board of Directors may, in its
discretion, discontinue Employer Matching Contributions with respect to Members'
Compensation Deferral Contributions for Compensation not yet earned on the date
such Employer Matching Contributions are discontinued.
5.2 Treatment of Forfeitures. Any amounts forfeited in accordance with
Sections 7.4 (Forfeitures) and 14.6 (Unclaimed Amounts) shall be applied as a
credit towards the amount of Employer Matching Contributions otherwise required
under Section 5.1. However, if pursuant to Section 5.1, Employer Matching
Contributions are discontinued, for Plan Years following the Plan Year in which
such discontinuance occurs, any such forfeited amounts in excess of the amounts
required to restore forfeited amounts to the Employer Matching Contributions
Accounts of Members who are reemployed in accordance with Section 7.4 shall be
allocated as of the last day of the Plan Year to the Member's Employer Matching
Contributions Accounts in an amount equal to the amount of such forfeited
amounts available for allocation
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multiplied by a fraction the numerator of which is the Member's Compensation
Deferral Contributions for the Plan Year not in excess of six percent of such
Member's Compensation and the denominator of which is the aggregate of all
Members' Compensation Deferral Contributions not in excess of six percent of all
such Members' Compensation.
5.3 Transfer of Contributions to Trustee. Employer Matching Contributions
under this Article V with respect to each payroll period shall be paid to the
Trustee as soon as practicable after the close of the month in which such
payroll period ends and such Employer Matching Contributions (inclusive of the
credit for forfeitures as provided in Section 5.2) shall be credited as of the
last day of such month to each Member's Employer Matching Contributions Account.
ARTICLE VI
Accounts
6.1 Maintenance of Accounts. For each Member the Committee shall, where
applicable, cause a separate Compensation Deferral Contributions Account, an
Employer Matching Contributions Account, a Rollover Contribution Account and a
Prior Plan Account to be maintained. For Employee contributions made to a Prior
Plan which were not Compensation Deferral Contributions the Committee shall
continue to maintain a separate Employee Contributions Account.
6.2 Valuations. As of each Valuation Date, the Committee shall adjust the
Employee Contributions Account, the Compensation Deferral Contributions Account,
the Employer Matching Contributions Account, the Rollover Contribution Account
and Prior Plan Account, as applicable, for each Member to reflect his share of
contributions (including for this purpose contributions made after such
Valuation Date but credited as of such Valuation Date), amounts of interest paid
or accrued in respect of a loan made to such Member pursuant to Section 9.5,
withdrawals, distributions, forfeitures, income, expenses payable from the Trust
Fund and any increase or decrease in the value of Trust Fund assets since the
preceding Valuation Date. Each separate account maintained for each loan made to
a Member pursuant to Section 9.5 shall be valued as of each Valuation Date by
adjusting the balance of the loan for the payments of principal thereunder.
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ARTICLE VII
Vesting of Accounts
7.1 Employer Matching Contributions Account. A Member's interest in the
Member's Employer Matching Contributions Account shall become 100% vested after
completion of at least five years of service provided, however, that (a)
Employer Matching Contributions to accounts of Highly Compensated Employees
shall not be deemed to vest until the Deferral Percentage and Contributions
Percentage limitations set forth in Article IV have been satisfied and (b)
nothing herein shall delay vesting pursuant to the provisions of a Prior Plan.
7.2 Other Accounts. Interests in Compensation Deferral Contributions
Accounts, Prior Plan Accounts, Rollover Contribu- tion Accounts and Employee
Contributions Accounts shall be fully vested at all times.
7.3 Earlier Vesting in Employer Matching Contributions Accounts.
Notwithstanding the foregoing, a Member's interest in his or her Employer
Matching Contributions Account shall be fully vested (a) on the date of
termination of employment by reason of death, Retirement or Total and Permanent
Disability, (b) when and if this Plan shall at any time be terminated for any
reason, (c) upon the complete discontinuance of contributions by the Employer
hereunder, or (d) upon partial termination of this Plan if such Member is a
member affected by such partial termination.
7.4 Forfeitures. A Member's Employer Matching Contributions Account which
is not vested in accordance with this Article VII at the time of such Member's
termination of employment shall be forfeited as of the last day of the Valuation
Period following the Valuation Period in which the Member has a termination of
employment. However, if a Member who has a termination of employment is
reemployed before the end of a period of five consecutive Plan Years beginning
with the Plan Year in which the Member has a termination of employment and
during which the Member is not an Employee on the last day of each Plan Year,
any forfeited amounts shall be restored to the Member's Employer Matching
Contributions Account provided, however, that any termination distribution from
the Employee's Compensation Deferral Contribution Account be first returned to
the Plan. For purposes of the preceding sentence, any Plan Year in which a
Member is absent from work on the last day of the Plan Year by reason of a
Parental Leave shall not be counted as one of the Plan Years in such a period of
five consecutive Plan Years and the Plan Year immediately preceding the Plan
Year immediately following a Plan Year in which such Member is absent from work
on the last day of the Plan Year by reason of Parental Leave shall be deemed to
be consecutive.
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Amounts required to be restored to the Employer Matching Contributions
Accounts of a Member shall be reinstated, to the extent not contributed by an
Employer, out of amounts forfeited under this Section 7.4 or 14.6 (Unclaimed
Amounts) for the Plan Year and, to the extent such forfeitures are not
sufficient, shall be charged ratably against income of the Trust Fund.
ARTICLE VIII
Investment of Accounts
8.1 Investment of Accounts Other Than Employer Matching Contributions
Accounts. Upon becoming a Member, the Member shall direct that Compensation
Deferral Contributions and any Prior Plan Contributions, Rollover Contributions
or Employee Contributions be invested in increments of 5% in one or more of the
following Investment Funds (or such other Fund as may hereafter be approved by
the Committee) which individually and collectively are designed to conform to
DOL Regulation 2550.404c-1 for so-called Section 404(c) plans in order that
fiduciaries of the Plan may be relieved of liability for any losses which are
the direct and necessary result of a Member's investment directions:
(a) The Company Stock Fund, which is invested in Employer
Securities. Members will not be permitted to direct that an investment be
made in the Company Stock Fund unless and until the Member has received a
prospectus in respect of Employer Securities in the Company Stock Fund
which meets the requirements of the Securities Act of 1933 or in the
opinion of counsel for the Company such investment may be otherwise
permitted.
(b) The Fixed Income Fund, which invests mainly in fixed income
investments that emphasize preservation of principal and seeks a target
rate of return over a period of at least six months.
(c) The Federated Bond Fund, seeks high income by investing in a
wide range of bonds, including lower-rated, high-yielding bonds.
(d) The Janus Fund, which seeks long-term growth by investing in
common stocks in companies of any size but with an emphasis on larger
companies.
(e) The Neuberger & Berman Guardian Trust Fund, which seeks
long-term growth and income by investing in stocks of established
high-quality companies considered to be undervalued in comparison with
stocks of similar companies.
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(f) The BT Investment International Equity Fund, which is invested
in stocks of established companies in countries with strong economies
primarily in Europe and the Pacific Basin. Investments in companies
outside the United States offer increased diversification with broadened
opportunity and potentially high returns.
(g) The Twentieth Century Ultra Fund, which seeks long-term growth
by investing in stocks of medium-size to large companies with better than
average growth potential.
(h) The BT Investment Equity Appreciation Fund, which is invested in
stocks of medium-sized companies in high-growth industries. The Fund
focuses on industries most likely to benefit from large scale changes
taking place in society. Investments in medium-sized companies in high
growth industries offers greater volatility than investments in larger
companies in mature industries.
(i) The BT Investment Small Cap Fund, which seeks long-term growth
by primarily investing in stocks of small U.S. companies with superior
growth potential. This fund may also invest up to 25% of its assets in
foreign stocks.
(j) Three BT Investment Lifecycle Funds, which are each invested in
a continuously monitored mix of stocks, bonds and money market instruments
keyed to the investor's investment term and risk tolerance:
I. The Short Range Fund, concentrates on securities
offering high income yield with less potential for
growth. Suitable for investment terms of five or
fewer years.
II. The Mid-Range Fund seeks a balance between investments
offering high income yield and those offering more growth
potential for the medium term.
III. The Long Range Fund pursues higher growth and income
investments while reducing exposure to market volatility
through the benefits of investing for longer terms.
8.2 Redirection of Future Contributions. A Member's investment direction
under Section 8.1 may be changed at any time and will be effective for
contributions received for the current month provided that the Appropriate
Notice is received by the Committee before 2 P.M. Eastern Time on the last
business day of
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the month. Such change in direction will not be effective as to
amounts previously contributed or invested.
8.3 Reinvestment of Prior Contributions.
(a) Effective on the Enrollment Date following the month in which
the Appropriate Notice is received by the Committee (not later than 2 P.M.
Eastern Time on the last business day of the month) a Member may direct
that up to the total value in any Investment Fund holding investments from
the Member's Compensation Deferral Contributions Account, Prior Plan
Account, Rollover Contribution Account or Employee Contributions Account
be transferred from such Investment Fund to any other Investment Fund in
increments of 5%.
(b) The Committee may, in its sole discretion, impose at any time or
from time to time such restrictions on the transfers of monies from one
Investment Fund to another as it deems necessary or appropriate.
8.4 Investment of Employer Matching Contributions Accounts.
Employer Matching Contributions shall be invested only in Employ-
er Securities through the Company Stock Fund.
8.5 Statements of Accounts And Confirmation of Investment
Directions.
(a) Statements of Accounts. Each Member shall be furnished a
quarterly statement of accounts. A like statement shall be furnished
to a Member upon any distribution being made under the Plan.
(b) Confirmations of Investment Directions. All
investment directions given by Members under the Plan
shall be confirmed in writing.
8.6 Crediting of Accounts. Interests in each of the Investment Funds shall
be credited to each Member's Accounts as units of value determined separately
for each Investment Fund, as follows:
(a) the initial value of a unit in each Investment Fund shall be one
dollar,
(b) the unit of value of each Investment Fund shall be redetermined
on each Valuation Date by dividing the then fair market value of all of
the assets of such Investment Fund by the number of units therein then
outstanding. Amounts held as a result of forfeiture shall not be included
in the value of the Company Stock Fund in determining the unit of value;
and
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(c) current Compensation Deferral Contributions, Employer Matching
Contributions and Rollover Contributions will be credited to the Member's
Accounts as units of value, the number of which is determined by dividing
the dollar amount of the contribution by the then current unit of value.
If a suspense account credited in accordance with Section 4.3(f) is in
existence on a Valuation Date, the number of units of value in the suspense
account shall be adjusted as of each Valuation Date so that such an account does
not participate in the Trust's investment gains or losses. To the extent a
Member's Compensation Deferral Contributions Account is invested pursuant to
Section 9.5 in a loan to a Member, the Member's Accounts shall be credited and
charged directly with income, gains, losses and expenses attributable to such
loan as of each Valuation Date and the value of the account will be adjusted
through the date of a distribution to reflect the value of such direct
investments on the distribution date. The Member's loan principal and interest
payments (i) shall be credited to the Member's Compensation Deferral
Contributions Account as units of value, the number of which is determined as of
the Valuation Date next following the date of such payment by dividing the
dollar amount of the payment by the then current unit of value and (ii) shall be
invested in accordance with the Member's investment directions for future
Compensation Deferral Contributions pursuant to Section 8.2.
8.7 Correction of Errors. In the event of an error in the adjustment of a
Member's Account, the Committee, in its sole discretion, may correct such error
by either crediting or charging the adjustment required to make such correction
to or against Forfeitures for the Plan Year or to or against income as an
expense of the Trust for the Plan Year in which the correction is made, or if an
Employer contributes an amount to correct any such error, from such amount.
Except as provided in this Section, the Accounts of other Members shall not be
readjusted on account of such error.
8.8 Investment of Deferred Distributions. Former Members of the Plan shall
have the same investment options for their Accounts as are available for the
Accounts of current Members of the Plan.
ARTICLE IX
Withdrawals and Loans During Employment
9.1 Withdrawal Options. In any twelve-month period a Member may make one
withdrawal from the Plan that is not less than $500 or the combined total of all
of the eligible funds in
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the Member's Accounts from which withdrawals may be made.
Eligibility includes:
(a) Hardship Eligibility. In the event of Hardship (as defined in
Section 9.2) before age 59-1/2, the entire balance in the Member's
Employee Contributions Account, Rollover Contribution Account or Prior
Plan Account, plus the sum of all contributions that have been credited to
a Member's Compensation Deferral Contributions Account to date together
with any Income allocable to such contributions as of December 31, 1988.
(b) Age 59-1/2 Eligibility. After a Member attains age 59-1/2 the
vested portion of such Member's Employer Contributions Account, plus the
entire balance in all of the Member's other Accounts.
9.2 Hardship Withdrawals.
(a) Verification of Need. Each request for a hardship withdrawal
must be accompanied by a statement signed by the Member attesting that the
financial need cannot be relieved,
(i) Through reimbursement or compensation by insurance or
otherwise,
(ii) By liquidation of the Member's assets (including those
assets of the Member's spouse and minor children that are reasonably
available to the Member) to the extent such liquidation will not
itself cause immediate and heavy financial need,
(iii) By ceasing Compensation Deferral Contributions under
the Plan, or
(iv) By other distributions or nontaxable (at the time of the
loan) loans from any plan maintained by the Employer or any other
employer, or by borrowing from commercial sources on reasonable
commercial terms.
The Committee shall be entitled to rely on the Member's statement of
need without inquiry into the Member's financial circumstances.
(b) Determination of Hardship. A withdrawal will be
deemed to be a hardship withdrawal if made on account of:
(i) Medical expenses incurred, or to be incurred, by the
Member, the Member's spouse, or any dependent,
(ii) Purchase (excluding mortgage payments) of a principal
residence for the Member,
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(iii) Payment of tuition for the next year, semester or
quarter of post-secondary education for the Member, the Member's
spouse or any dependent,
(iv) The need to prevent the eviction of the Member from the
Member's principal residence or foreclosure on the mortgage of the
Member's principal residence,
(v) Such other immediate and heavy financial need as the
Commissioner of Internal Revenue may from time to time publish by
revenue rulings, notices and other documents of general
applicability, or
(vi) Any other immediate and heavy financial need as
determined on the basis of all relevant facts and circumstances by
the Committee in an objective and nondiscriminatory manner in
accordance with the requirements of the Code and the applicable
regulations and in accordance with the following standards and
principles:
(A) the need shall be due to an extraordinary emergency,
(B) the need shall be heavy,
(C) the need shall be immediate,
(D) the need shall be for reasons of hardship as
commonly understood such as financial expenses and not for
entertainment or pleasure, and
(E) the need shall not fail to qualify as immediate and
heavy merely because such need was reasonably foreseeable or
voluntarily incurred.
9.3 Values. All withdrawals under Sections 9.1 or 9.2 shall be based on
the values of Accounts as of the Valuation Date next following the date that the
Appropriate Notice was given to the Committee, or such other Valuation Date as
the Committee shall prescribe. Any withdrawal from any Account (or Subaccount
thereof) under Sections 9.1 and 9.2 shall be charged proportionately against
each Investment Fund described in Article VIII (Investment of Accounts) in which
such Account is invested.
9.4 Payment of Withdrawals. Any amount withdrawn under Section 9.1 shall
be paid to a Member in a lump sum in cash, as soon as practicable after the
Valuation Date as of which the withdrawal election is effective provided,
however, that at the
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Member's request whole numbers of Employer Securities contained in the Member's
Account may be distributed in kind.
9.5 Loans. A Member who is a "party in interest" as defined in Section
3(14) of ERISA (a "Party in Interest") may borrow for any purpose from his or
her Employee Contributions Account, Compensation Deferral Contributions Account,
Prior Plan Account, if any, and Rollover Contribution Account in increments of
not less than $1,000 once in any twelve-month period an amount (inclusive of
current loans) of up to one half of the total of such accounts, but in any event
not more than $50,000 reduced by the excess (if any) of the highest balance of
existing loans during the preceding 12 months over the current loan.
For the purposes of the foregoing, any outstanding balance of an
existing loan shall be aggregated with any additional funds being borrowed in
order to calculate a Member's borrowing limit. Transactions for additional funds
shall be booked and documented at then current interest rates as a new loan.
All loans shall be made pursuant to such other procedures and terms as
shall be adopted by the Committee, subject to the following:
(a) A loan may remain outstanding so long as the borrower remains a
Party in Interest and shall be repayable within five years from the date
of borrowing upon such terms as may be determined by the Committee;
provided, however, that any loan of more than $15,000 used to acquire the
primary residence of a Member shall be repayable over a period of up to
ten years as determined by the Committee. A Member may have no more than
one primary residence loan and one loan for any other purpose outstanding
at any time.
The Committee may in its absolute discretion grant such loan in
accordance with such uniform and nondiscriminatory rules as it may from
time to time establish. Any such loan shall be made at a then prevailing
commercial rate of interest for similar credits on such terms of repayment
(in level payments not less frequent than monthly) and subject to such
rules and restrictions as the Committee shall determine, provided that any
such loans shall be available to all Members on a reasonably equivalent
basis and that any loan may be repaid at any time without penalty.
All Member loans shall be secured on a dollar for dollar basis by up to
50% of the balance of the Accounts from which the loan is made. To the
extent a loan is unpaid, it shall be deducted from the amount payable to
such Member or such
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Member's beneficiary at the time of distribution of the Accounts from
which the loan was made;
(b) In the event that a Member fails to repay a loan according to
its terms and foreclosure occurs, the Plan may foreclose on the portion of
the Member's Accounts for which a distributable event has occurred. In the
event of foreclosure, a distributable event shall be deemed to occur
immediately following the next Valuation Date for any portion of an
Account with respect to which the Member or the Member's Beneficiary would
be permitted in accordance with Sections 9.1 or 10.1 to elect an immediate
distribution;
(c) The receivable representing the loan (and other loans to the
same Member) will be accounted for by the Trustee as a separate earmarked
investment solely for the individual account of the Member. A Member's
payments to the Trust of principal and interest on the loan shall be
invested by the Trustee as elected by the Member in accordance with the
Member's investment directions for future contributions in accordance with
Section 8.2, as soon as reasonably practical;
(d) Loan applications may be made at any time by any Member by
giving the Appropriate Notice to the Committee or its designee at any
time.
(e) No loan shall remain outstanding after a Member is no longer a
Party in Interest. If a Member who is no longer a Party in Interest elects
under Section 10.7 not to file a claim for the commencement of benefits
when the Member's employment is terminated, the balance of any outstanding
loan must be repaid in full within sixty (60) days.
(f) Loan Origination Fee. From time to time the
Committee may set a reasonable loan origination fee for each
loan application. Such fees shall be deducted from loan
proceeds paid to loan applicants.
ARTICLE X
Distribution
10.1 Amount of Distribution. The Member or the Member's beneficiary, as
the case may be, shall not be entitled to elect to receive a distribution of the
vested value of the Member's account until:
(a) the Member's Retirement, termination of employment, death or Permanent
Disability, or
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(b) termination of the Plan without establishment or main- tenance of a
successor plan, or
(c) the date of sale of substantially all of the assets of the Employer to
an acquiring corporation which continues the employment of the Member
without the establishment of a successor plan.
The vested value of the Member's Account shall be determined in accordance
with Article VII (Vesting of Accounts) as of the Valuation Date next following
such election except that in the case of the Member's Total and Permanent
Disability the vested value of the Member's account shall be determined as of
the Valuation Date next following the date the Committee determines that the
Member has a Total and Permanent Disability. In any event, such Valuation Date
shall be no later than the Valuation Date which immediately precedes the
Member's Required Beginning Date (or the date which would have been the Member's
Required beginning Date had the Member survived). Distributions under the Plan
to a Member's Beneficiary shall be completed not more than five years after the
Member's death.
10.2 Notice of Options and Normal Form of Distribution.
(a) Notice of Options.
(i) No less than thirty (30) nor more than ninety (90) days prior to
the date of any distribution hereunder the Plan Administrator shall
provide the Member with a general description of the material features and
an explanation of the relative values of the optional forms of benefits
available under the Plan.
(ii) If a distribution is one to which Sections 401(a)(11) and 417
of the Code do not apply, such distribution may commence less than thirty
(30) days after the notice required under Reg. Section 1.411(a)-11(c) is
given, provided that:
(A) the Plan Administrator clearly informs the Member that the
Member has a right to a period of at least thirty (30) days after
receiving the notice to consider the decision of whether or not to
elect a distribution (and, if applicable, a particular distribution
option), and
(B) the Member, after receiving the notice, affirmatively elects a
distribution.
(iii) If the distribution is one to which sections 401(a)(11) and
417 of the Code do apply such distributions
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may commence less than thirty (30) days after the notice required by
Section 10.8 provided that:
(A) The Plan Administrator clearly inform the Member that the Member
has a right to at least 30 days to consider whether to waive the Qualified
Joint and Survivor Annuity and consent to a form of distribution other
than a Qualified Joint and Survivor Annuity;
(B) the Member, after receiving the notice, affirmatively elects
(with spousal consent) to waive the Qualified Joint and Survivor Annuity;
and,
(C) Distribution in accordance with the affirmative election does
not commence before the expiration of the 7- day period that begins the
day after the explanation of the Qualified Joint and Survivor Annuity is
provided to the participant.
(b) Normal Form of Distribution. Unless otherwise elected in
accordance with Section 10.3 and subject to Section 10.7, distributions
shall be made by the Trustee as soon as practicable after the Valuation
Date next following the Member's (or the Member's Beneficiary's as the
case may be) election and written consent to receive a distribution of the
vested value of such Member's Account, in a single sum in cash except that
(i) at the Member's option Employer Securities held in the Member's
Account may be distributed in kind and (ii) in the discretion of the
Committee, a note with respect to a Participant's loan from such Member's
Compensation Deferral Account may be distributed in kind.
10.3 Alternate Form of Distribution. A Member may request to have the
value of such Member's Accounts distributed in a manner other than in accordance
with Section 10.2. For any portion of such Member's benefits accrued before May
1, 1995 that become distributable under the Plan after May 1, 1995 such
alternate form of payment may be an annuity contract pursuant to Section 10.8 or
periodic installments of all benefits commencing at such time as the Member
shall elect in accordance with the Plan payable over a fixed period not to
exceed the lesser of ten years or the life expectancy of the Member at the time
payments commence. Payment of any interest in the Company Stock Fund in a
Member's Accounts, if any, to which the Member has a nonforfeitable interest may
be made in cash solely for the purpose of effecting such an alternate form of
distribution.
Distributions will be made in accordance with the requirements of the
regulations under Code Section 401(a)(9), including the minimum distribution
incidental benefit requirements of Proposed Regulations Section 1.401(a)(9)-2.
Such minimum distri-
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bution requirements shall supersede any distribution options in the Plan that
are inconsistent therewith.
10.4 Identity of Payee. The determination of the Committee as to the
identity of the proper payee of any benefit under the Plan and the amount of
such benefit properly payable shall be conclusive, and payment in accordance
with such determination shall constitute a complete discharge of all obligations
on account of such benefit.
10.5 Non-alienation of Benefits.
(a) No benefit payable at any time under this Plan shall be subject
in any manner to alienation, sale, transfer, assignment, pledge,
attachment, or other legal processes, or encumbrance of any kind. Any
attempt to alienate, sell, transfer, assign pledge or otherwise encumber
any such benefits, whether currently or thereafter payable, shall be void.
No benefit, nor any fund which may be established for the payment of such
benefits, shall, in any manner, be liable for or subject to the debts or
liabilities of any person entitled to such benefits. If any person shall
attempt to, or shall alienate, sell, transfer, assign, pledge or otherwise
encumber benefits to which such person may become entitled under this
Plan, or if by reason of such person's bankruptcy or other event happening
at any time, such benefits would devolve upon any other person or would
not be enjoyed by the person entitled thereto under the Plan, then the
Committee, in its discretion, may terminate the interest in any such
benefits of the person entitled thereto under the Plan and hold or apply
them to or for the benefit of such person entitled thereto under the Plan
or such person's spouse, children or other dependents, or any of them, in
such manner as the Committee may deem proper.
(b) Notwithstanding Section 10.5(a), the Trustee
(i) shall comply with an order entered on or after January 1,
1985, determined by the Committee to be a Qualified Domestic
Relations Order as provided in Section 10.6 and
(ii) may treat an order entered before January 1, 1985, as a
Qualified Domestic Relations Order even if it does not meet the
requirements of Section 10.6.
(iii) shall comply with a Federal tax levy made
pursuant to Code Section 6331 and with collection
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proceedings by the United States on a judgment result-
ing from an unpaid tax assessment.
10.6 Qualified Domestic Relations Order.
(a) The Plan shall comply with the provisions of Code Section 414(p)
relating to qualified domestic relations orders and all regulations
pertaining thereto.
(b) An alternate payee's interest in the Plan will be distributed in
the form of a single sum as soon as practicable after a proposed order is
determined to be a qualified domestic relations order.
10.7 Commencement of Benefits. Unless a Member elects otherwise, the
payment of benefits under the Plan shall begin not later than the 60th day after
the latest of the close of the Plan Year in which:
(a) the Member attains age 65;
(b) the 10th anniversary of the date the Member's
participation in the Plan occurs;
(c) the Member's employment with the Employer or an
Affiliate is terminated.
provided that, except as provided in Section 10.10, no benefits shall be
distributed unless the Member has filed a claim for benefits until the Valuation
Date immediately preceding the Required Beginning Date and further provided that
benefits shall commence to be distributed to the Member not later than the
Member's Required Beginning Date.
10.8 Annuities. If the form of distribution is to be an annuity contract,
it may be in such form and with such provisions as the Member or the Member's
Beneficiary, as the case may be, may elect which are available for purchase from
an insurance company including, but not limited to, a full cash refund life
annuity, an annuity with income for life or an annuity with income for a period
certain (payable at least annually). Such distribution is to be provided through
the purchase from an insurance company and distribution from the Trust Fund of a
nontransferable annuity contract; provided the benefit under such annuity
contract cannot be paid to anyone other than the Member prior to the Member's
death, and if a joint and survivor annuity is provided, unless such joint
annuitant shall be the Member's spouse, the actuarial value of the Member's
benefits, as of the date benefit payments commence, shall be more than 50
percent (50%) of the Member's vested Accounts.
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(a) Limitation on Member Elections. Notwithstanding any elections
made by the Member, benefit payments shall be made over a period not in
excess of the life of the Member or the lives of the Member and the
Member's Beneficiary or the Member's life expectancy or the joint and last
survivor life expectancy of the Member and the Member's Beneficiary. In
the event the annuity benefits have commenced to be paid to a Member
before the Member's death the remaining interest will be distributed at
least as rapidly as under the election made by the Member prior to the
date of death.
(b) Qualified Joint and Survivor Annuities. Notwithstanding the
foregoing provisions of this Section 10.8, in the case of a Member who has
elected to receive an annuity form of benefit, distribution shall be in
the form of a Qualified Joint and Survivor Annuity, unless the Member with
the Member's spouse's consent as provided in Section 10.9 elects to
receive a different form of annuity. The term "Qualified Joint and
Survivor Annuity" means an annuity payable to the Member for life and, if
the Member's spouse survives the Member, a survivor annuity payable to the
spouse for life in an amount equal to 50 percent (50%) of the annuity
payable to the Member. If the Member who has elected to receive an annuity
form of benefit is not married, subject to Section 10.6 (Qualified
Domestic Relations Order), the annuity shall be paid in the form of a
single life annuity unless the Member waives the single life annuity. The
amount of the benefits payable under a Qualified Joint and Survivor
Annuity shall be the amount which can be purchased from an insurance
company with the Member' Accounts.
(c) A Member who elects to receive benefits in the form of a life
annuity and to whom benefits would be payable in the form of a Qualified
Joint and Survivor Annuity pursuant to this Section 10.8 shall have the
right to waive a Qualified Joint and Survivor Annuity, such waiver shall
be consented to by the Member's spouse in writing in accordance with
Section 10.9 by delivering written notice to the Committee, at any time
within the 90-day period prior to the annuity starting date, to receive a
different form of an annuity, the Committee shall within a reasonable
period of time provide the Member, by personal delivery or first class
mail, with a written explanation of:
(i) the terms and conditions of the Quali- fied Joint and
Survivor Annuity;
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(ii) the Member's right to make, and the effect of, an
election to waive the Qual- ified Joint and Survivor Annuity;
(iii) the rights of the Member's spouse to consent to the
Member's election to waive the Qualified Joint and Survivor Annuity
and the effect of consenting to such waiver; and
(iv) the Member's right to make, and the effect of, a
revocation of an election to waive the Qualified Joint and Survivor
Annuity.
Any election made by a Member pursuant to Sections 10.8(b) and 10.8(c) may
be revoked by such Member by delivering written notice to the Committee at any
time prior to the Member's annuity starting date and, once revoked, may be made
again at any time by delivering written notice to the Committee prior to the
Member's annuity starting date.
10.9 Spousal Consent. A valid spousal consent to the Member's naming of a
Beneficiary other than the Member's spouse or to the Member's waiver of a
Qualified Joint and Survivor Annuity as defined in Section 10.8(b) shall be
designated:
(a) in a writing acknowledging the effect of the consent;
(b) witnessed by a notary public; and
(c) effective only for the spouse who exercises the consent;
provided that, notwithstanding the provisions of this Article X, the consent of
a Member's spouse shall not be required if it is established to the satisfaction
of the Plan Administrator that such consent may not be obtained because there is
no spouse, because the spouse cannot be located or because of such other
circumstances as the Secretary of the Treasury may by regulations prescribe.
10.10 Lump Sum Payment Without Election. Notwithstanding any other
provision of this Article X, if a Member or a Beneficiary is entitled to a
distribution and if the vested value of a Member's Account or the vested value
of the Beneficiary's share of the Member's Account before benefits are paid or
commence to be paid hereunder does not exceed (and at the time of any previous
distribution did not exceed) $3,500, the Committee may in accordance with
uniform and nondiscriminatory rules direct the immediate distribution of such
benefit to the person entitled
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thereto regardless of any election or consent of the Member, the Member's spouse
or other Beneficiary.
10.11. Trustee to Trustee Transfers.
(a) A Member who receives an Eligible Rollover Distribution after
December 31, 1992 may elect to have such distribution paid directly to an
Eligible Retirement Plan by specifying in the Appropriate Notice the
Eligible Retirement Plan to which such distribution is to be paid in a
direct trustee to trustee transfer pursuant to such uniform rules as to
the form and time of transfer as the Committee shall prescribe.
(b)(i) "Eligible Rollover Distribution." An Eligible Rollover
Distribution is any distribution of all or a portion of the balance to the
credit of the Member distributee, except that an Eligible Rollover
Distribution does not include: any distribution that is one of a series of
substantially equal periodic payments (not less frequently than annually)
made for the life (or life expectancy) of the Member distributee or the
joint lives (or joint life expectancies) of the Member distributee and the
Member's designated beneficiary, or for a specified period of ten years or
more; any distribution to the extent such distribution is required under
section 401(a)(9) of the Code; and the portion of any distribution that is
not includible in gross income ( determined without regard to the
exclusion for net unrealized appreciation with respect to Employer
Securities).
(b)(ii) "Eligible Retirement Plan." An Eligible Retirement Plan is
an individual retirement account described in section 408(a) of the
Code, an individual retirement annuity described in section 408(b)
of the Code, an annuity plan described in section 403(a) of the
Code, or a qualified trust described in section 401(a) of the Code,
that accepts the Member distributee's Eligible Rollover
Distribution. However, in the case of an Eligible Rollover
Distribution to the surviving spouse of a Member, an Eligible
Retirement Plan is an individual retirement account or an individual
retirement annuity.
ARTICLE XI
Administration of the Plan
11.1 Plan Administrator. The Committee shall be the Plan Administrator:
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(a) The Committee shall administer, enforce and interpret the Plan
and the trust agreement established hereunder and shall have the powers
necessary thereto, including but not by way of limitation the powers to
exercise its responsibilities in accordance with Sections 1.3 (Appropriate
Notice), 1.9 (Compensation), 1.21 (Enrollment Date), 1.29 (Leave of
Absence), 1.42 (Total and Permanent Disability), Article II (Eligibility
and Membership) 3.1 (Compensation Deferral Contributions), 3.2 (Changes
and Suspension of Contributions), 4.1 (Limitations), 6.1 (Maintenance of
Accounts), 6.2 (Valuations), Article VIII (Investment of Accounts),
Article IX (Withdrawals and Loans During Employment), 12.6 (Disbursement
of Funds), Article XIV (Miscellaneous), and the remainder of this Article
XI, and
(b) Authority to hold the funds of the Plan shall be delegated to
the Trustee in accordance with Section 12.2 (Trustee), and
(c) Authority to direct the investment of the Plan's funds shall be
delegated to an Investment Manager in accordance with Section 12.3
(Investment Manager).
With respect to all other responsibilities of the Plan Administrator the
Committee shall act through its duly authorized officers and agents.
11.2 Board of Directors. With respect to Sections 5.1 (Amount of Employer
Matching Contributions), 11.8 (Personal Liability), 13.1 (Right to Amend) and
13.2 (Suspension or Termination) the Employer shall act only by or pursuant to,
a resolution of the Board of Directors.
11.3 Appointment of the Committee. The Committee shall be the Benefits
Administration Committee.
11.4 Compensation, Expenses. All proper expenses required for the
administration of the Plan incurred by the Committee, the Employer, an
Investment Manager or the Trustee for accounting, legal and other professional,
consulting or technical services, including fees and expenses of a recordkeeper,
the Trustee or any Investment Manager shall be paid by the Trust.
11.5 Committee Actions, Agents. The Committee may appoint such agents, who
need not be members of the Committee, as it may deem necessary for the effective
performance of its duties and may delegate to such agents such powers and duties
as the Committee may deem expedient or appropriate.
Any action of the Committee, including but not by way of limitation,
instructions to the Trustee, shall be evidenced by
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the signature of a member who has been so authorized by the Committee to sign
for it, and the Trustee shall be fully protected in acting thereon. A
certificate of the secretary or an assistant secretary of the Committee setting
forth the name of the members thereof shall be sufficient evidence at all times
as to the persons then constituting the Committee.
11.6 Committee Meetings. The Committee shall hold meetings upon such
notice, at such time and place as they may determine. The Committee shall act by
a majority of its members at the time in office and such action may be taken
from time to time by a vote at a meeting or in writing without a meeting. A
majority of the members of the Committee at the time in office shall constitute
a quorum for the transaction of business.
11.7 Authority and Duties of the Committee. The Committee may from time to
time establish rules for the administration of the Plan. The Committee shall
have the exclusive right to interpret the Plan and to decide any matters arising
thereunder in connection with the administration of the Plan. It shall endeavor
to act by general rules so as not to discriminate in favor of any person. Its
decisions and the records of the Committee shall be conclusive and binding upon
the Employer, Members and all other persons having an interest under the Plan.
No member of the Committee shall be disqualified from exercising the powers and
discretion herein conferred by reason of the fact that the exercise of any such
power or discretion may affect the payment of benefits to such member under the
Plan; however, no member may vote on a matter relating exclusively to such
member. To the extent that it is administratively feasible, the period of notice
required for Members' elections to commence, change or suspend contributions
hereunder or to make or change investment elections for either future
contributions or existing accounts may be relaxed, reduced or eliminated by the
Committee in accordance with uniform and non-discriminatory rules.
The Committee shall keep or cause to be kept all records and other data as
may be necessary for the administration of the Plan.
11.8 Personal Liability. To the extent not contrary to the provisions of
ERISA, no member of the Committee, officer, director or employee of an Employer
shall be personally liable for acts done in good faith hereunder unless
resulting from such member's own negligence or willful misconduct. Each such
member of the Committee, officer and director shall be indemnified by the
Employer against expenses reasonably incurred by such member in connection with
any action to which he may be a party by reason of such member's
responsibilities hereunder, except in relation to matters as to which such
member shall be adjudged in such action to be liable for negligence or
misconduct in the performance of such member's duty. However, nothing in this
Plan
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shall be deemed to relieve any person who is a fiduciary under the Plan for
purposes of ERISA from any responsibility or liability which such Act shall
impose upon such member.
11.9 Dealings Between the Committee and Individual Members. Any notice
required to be given to, or any document required to be filed with, the
Committee will be properly given or filed if mailed by registered or certified
mail, postage prepaid, or delivered to the Chairman of the Benefits
Administration Committee, c/o U.S. Industries, Inc. 101 Wood Avenue South,
Iselin, New Jersey 08830, or to such other place as the Committee may hereafter
from time to time designate.
The Committee shall make available to such Member for examination, such of
its records as pertain to the benefits to which such Member shall be entitled
under the Plan.
11.10 Information To Be Supplied by the Employer. The Employer shall
provide the Committee or its delegate with such information as it shall from
time to time need in the discharge of its duties.
11.11 Records. The regularly kept records of the Committee and the
Employer shall be conclusive evidence of the Credited Service and Service of an
Employee, the Employee's Compensation, age, marital status, status as an
Employee, and all other matters contained therein applicable to this Plan;
provided that an Employee may request a correction in the record of age or any
other disputed fact at any time prior to retirement. Such correction shall be
made if within 90 days after such request the Employee furnishes the Committee
in support thereof documentary proof of age or the other disputed fact
satisfactory to the Committee.
11.12 Fiduciary Capacity. Any person or group of persons may serve in more
than one fiduciary capacity with respect to the Plan.
11.13 Fiduciary Responsibility. If a Plan fiduciary acts in accordance
with ERISA, Title I, Subtitle B, Part 4,
(a) in determining that a Member's spouse has consented to the
naming of a Beneficiary other than the spouse or that the consent of the
Member's spouse may not be obtained because there is no spouse, the spouse
cannot be located or other circumstances prescribed by the Secretary of
the Treasury by regulations, then to the extent of payments made pursuant
to such consent, revocation or determination, the Plan and its fiduciaries
shall have no further liability; or
(b) in treating a domestic relations order as being (or not being) a
Qualified Domestic Relations Order, or,
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during any period in which the issue of whether a domestic relations order
is a Qualified Domestic Relations Order is being determined (by the
Committee, by a court of competent jurisdiction, or otherwise), in
separately accounting for the amounts which would have been payable to the
alternate payee during such period if the order had been determined to be
a Qualified Domestic Relations Order, in paying the amounts separately
accounted for to the person entitled thereto if within 18 months the
domestic relations order (or a modification thereof) is determined to be a
Qualified Domestic Relations Order, in paying such amounts to the person
entitled thereto if there had been no order if within 18 months the
domestic relations order is determined not to be qualified or if the issue
is not resolved within 18 months and in prospectively applying a domestic
relations order which is determined to be qualified after the close of the
18-month period, then the obligation of the Plan and its fiduciaries to
the Member and each alternate payee shall be discharged to the extent of
any payment made pursuant to such acts.
11.14 Claim Procedure.
(a) Each Member or Beneficiary ("Claimant") may submit an
application for benefits ("Claims") to the Committee or to such other
person as may be designated by the Committee in writing in such form as is
provided or approved by the Committee. A Claimant shall have no right to
seek review of a denial of benefits, or to bring any action in any court
to enforce a Claim prior to filing a Claim and exhausting all rights to
review in accordance with this Section.
When a Claim has been filed properly, such Claim shall be evaluated
and the Claimant shall be notified of the approval or the denial of the
Claim within ninety (90) days after the receipt of such Claim unless
special circumstances require an extension of time for processing the
claim. If such an extension of time for processing is required, written
notice of the extension shall be furnished to the Claimant prior to the
termination of the initial ninety (90) day period, which notice shall
specify the special circumstances requiring an extension and the date by
which a final decision will be reached (which date shall not be later than
one hundred and eighty (180) days after the date on which the Claim was
filed). A Claimant shall be given a written notice in which the Claimant
shall be advised as to whether the Claim is granted or denied, in whole or
in part. If a Claim is denied, in whole or in part, the notice shall
contain (1) the specific reasons for the denial, (2) references to
pertinent Plan provisions upon which the denial is based, (3) a
description of
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any additional material or information necessary to perfect the Claim and
an explanation of why such material or information is necessary, and (4)
the Claimant's rights to seek review of the denial.
(b) If a Claim is denied, in whole or in part, the Claimant shall
have the right to (i) request that the Committee (or such other
person as shall be designated in writing by the Committee) review
the denial, (ii) review pertinent documents, and (iii) submit issues
and comments in writing, provided that the Claimant files a written
request for review with the Committee within sixty (60) days after
the date on which the Claimant received written notification of the
denial. Within sixty (60) days after a request for review is
received, the review shall be made and the Claimant shall be advised
in writing of the decision on review, unless special circumstances
require an extension of time for processing the review, in which
case the Claimant shall be given a written notification within such
initial sixty (60) day period specifying the reasons for the
extension and when such review shall be completed within one hundred
and twenty (120) days after the date on which the request for review
was filed. The decision on review shall be forwarded to the Claimant
in writing and shall include specific reasons for the decision and
references to Plan provisions upon which the decision is based. A
decision on review shall be final and binding on all persons for all
purposes. If a Claimant shall fail to file a request for review in
accordance with the procedures herein outlined, such Claimant shall
have no rights to review and shall have no right to bring action in
any court and the denial of the Claim shall become final and binding
on all persons for all purposes.
ARTICLE XII
Operation of the Trust Fund
12.1 Trust Fund. All assets of the Plan shall be held in trust as a Trust
Fund for the exclusive benefit of Members and their Beneficiaries, and no part
of the corpus or income shall be used for or diverted to any other purpose. No
person shall have any interest in or right to any part of the Trust Fund, except
to the extent provided in the Plan.
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12.2 Trustee. All contributions to the Plan shall be paid to a Trustee or
Trustees which shall be appointed from time to time by the Company by
appropriate instrument with such powers in the Trustee as to control and
disbursement of the funds as the Company shall approve and as shall be in
accordance with the Plan. The Company may remove any Trustee at any time, upon
reasonable notice and upon such removal or upon the resignation of any Trustee
the Company shall designate a successor Trustee.
12.3 Investment Manager. In accordance with the terms of the trust
agreement, the Company may appoint one or more Investment Managers (individuals
and/or other entities), who may include the Trustee and who are collectively
referred to herein as the Investment Manager, to direct the investment and
reinvestment of part or all of the Plan's funds that are not invested in
Employer Securities. The Company may change the appointment of the Investment
Manager from time to time.
12.4 Purchase and Holding of Securities. As soon as
convenient after receiving contributions, the Trustee shall:
(a) in the case of contributions which are to be invested in
Employer Securities purchase Employer Securities in the open market, and
register and hold such securities in the name of the Trustee or its
nominee;
(b) in the case of contributions which are to be invested in the
Fixed Income Fund, purchase group annuity contracts or make other
investment arrangements that in the aggregate will provide the target rate
of return; and,
(c) In the case of any of the managed funds listed in Section 8.1
(c) through (j), purchase and hold shares in such funds in accordance with
the directions of Plan Members.
12.5 Voting of Employer Securities. For shareholders' meetings Members
shall be furnished proxy material and a form for instructing the Trustee how to
vote the Employer Securities represented by units credited to their Accounts,
and the Trustee shall vote or otherwise exercise shareholder rights with respect
to such Employer Securities as instructed. The Trustee shall hold such
instructions in confidence and shall not divulge them to anyone, including, but
not limited to, the Employer, its officers or employees.
Shares for which no instructions are received shall be voted by the
Trustee in the same proportion as those shares for which instructions have been
received. With respect to the exercise of shareholder's rights to sell or retain
the Employer Securities represented by units credited to a Member's Accounts in
extraordinary instances involving an unusual price and terms
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and conditions for such securities such as a tender offer, the Trustee shall act
in accordance with the Committee's instructions.
12.6 Disbursement of Funds. The funds held by the Trustee shall be
applied, in the manner determined by the Committee, to the payment of benefits
to such persons as are entitled thereto in accordance with the Plan.
The Committee shall determine the manner in which the funds of the Plan
shall be disbursed in accordance with the Plan, including the form of voucher or
warrant to be used in authorizing disbursements and the qualification of persons
authorized to approve and sign the same and any other matters incident to the
disbursement of such funds.
12.7 Exclusive Benefit of Members. All contributions under the Plan shall
be paid to the Trustee and deposited in the Trust Fund and shall be held,
managed and distributed solely in the interest of the Members and beneficiaries
for the exclusive purpose of (1) providing benefits to Members and beneficiaries
and (2) defraying reasonable administrative expenses of the Plan and the Trust,
to the extent such expenses are not paid by the Company or an Affiliate provided
that:
(a) if a timely determination letter request is filed and the Plan is
denied initial qualification under Section 401(a) of the Code,
contributions conditioned upon such qualification shall be returned to the
Company or the Affiliate making such contributions within one year of the
denial of qualification;
(b) if, and to the extent, a deduction for a contribution under Section
404 of the Code is disallowed, contributions conditioned upon
deductibility shall be returned to the Company or the Affiliate making
such contribution within one year after the disallowance of the deduction;
and
(c) if, and to the extent, a contribution is made through a good faith
mistake of fact, such contribution shall be returned to the Company or the
Affiliate making such contribution within one year.
ARTICLE XIII
Amendment, Termination and Merger
13.1 Right to Amend. The right to modify or amend the provisions of the
Plan in whole or in part at any time or from time to time is reserved to the
Company, but no such amendment
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shall divest any Member of any amount previously credited to a Member's Accounts
or, except to the extent permitted by the Secretary of the Treasury by
regulation, shall eliminate with respect to a Member's Account balance at the
time of such amendment an optional form of benefit, and further provided that no
part of the assets of the Trust Fund shall, by reason of any modification or
amendment, be used for or diverted to, purposes other than for the exclusive
benefit of Members and their Beneficiaries, under the Plan.
13.2 Suspension or Termination. The Employer may at any time suspend
Employer Matching Contributions and Compensation Deferral Contributions in whole
or in part. The suspension of Employer Matching Contributions and Compensation
Deferral Contributions shall not in itself constitute a termination of the Plan.
The Employer may at any time terminate or discontinue the Plan by filing with
the Committee a certified copy of the resolution of its board of directors
authorizing the termination or discontinuance.
If the Plan is terminated, no further contributions shall be made by the
Employer and the Account of each Member shall be applied for the Member's (or
the Member's Beneficiary's) benefit either by payment in cash or in kind, or by
the continuation of the Trust Fund in accordance with the trust instrument and
the provisions of the Plan as though the Plan were otherwise in full force and
effect.
13.3 Merger, Consolidation of Transfer. In the case of any merger, or
consolidation with, or transfer of assets or liabilities to any other plan, each
Member in the Plan would (if the Plan then terminated) receive a benefit
immediately after the merger, consolidation, or transfer which is equal to or
greater than the benefit such Member would have been entitled to receive
immediately before the merger consolidation, or transfer (if the Plan had then
terminated).
ARTICLE XIV
Miscellaneous
14.1 Uniform Administration. Whenever, in the administration of the Plan,
any action is required by the Employer or the Committee, including, but not by
way of limitation, action with respect to eligibility or classification of
employees, contributions or benefits, such action shall be uniform in nature as
applied to all persons similarly situated and no such action shall be taken
which will discriminate in favor of Members who are officers or significant
shareholders of the Employer or
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persons whose principal duties consist of supervising the work of other
employees or highly compensated Members.
14.2 Payment Due an Incompetent. If the Committee determines that any
person to whom a payment is due hereunder is incompetent by reason of physical
or mental disability, the Committee shall have power to cause the payments
becoming due to such person to be made to another for the benefit of the
incompetent, without responsibility of the Committee or the Trustee to see to
the application of such payment. Payments made in accordance with such power
shall operate as a complete discharge of all obligations on account of such
payment of the Committee, the Trustee and the Trust Fund.
14.3 Source of Payments. All benefits under the Plan shall be paid or
provided solely from the Trust Fund and the Employer assumes no liability or
responsibility therefor, except to the extent required by law.
14.4 Plan Not a Contract of Employment. Nothing herein contained shall be
deemed to give any Eligible Employee or Member the right to be retained in the
employ of the Employer or to interfere with the right of the Employer to
discharge any Eligible Employee or Member at any time.
14.5 Applicable Law. Except to the extent governed by Federal law the Plan
shall be administered and interpreted in accordance with the laws of the State
of New York.
14.6 Unclaimed Amounts. It shall be the duty and responsibility of a
Member or a Beneficiary to keep the Committee apprised of such Member's
whereabouts and of such Member's current mailing address. Unclaimed amounts
shall consist of the amounts of the Accounts of a retired, deceased or
terminated Member which cannot be distributed because of the Committee's
inability, after a reasonable search, to locate a Member or a Member's
Beneficiary within a period of two (2) years after the payment of benefits
becomes due. Unclaimed amounts for a Plan Year shall be Forfeitures for the Plan
Year in which such two-year period shall end. Such Forfeitures shall be treated
as provided in Section 5.2.
If an unclaimed amount is subsequently properly claimed by the Member or
the Member's Beneficiary ("Reclaimed Amount") and unless an Employer in its
discretion makes a contribution to the Plan for such year in an amount
sufficient to pay such Reclaimed Amount to the extent that the Reclaimed Amount
originated as an unclaimed amount, it shall be charged against Forfeitures for
the Plan Year and, to the extent such Forfeitures are not sufficient, shall be
treated as an expense of the Trust Fund.
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ARTICLE XV
Top Heavy Provisions
15.1 Application. The definitions in Section 15.2 shall apply under this
Article XV and the special rules in Section 15.3 shall apply in accordance with
Code Section 416, notwithstanding any other provisions of the Plan, for any Plan
Year in which the Plan is a Top Heavy Plan and for such other Plan Years as may
be specified herein. This Article XV shall have no effect on the amount of or
eligibility for benefits under the Plan of a Member unless and until the Plan
becomes a Top Heavy Plan.
15.2 Special Top Heavy Definitions. The following special definitions
shall apply under this Article XV.
(a) "Aggregate Employer Matching Contributions" means the sum of all
Employer Matching Contributions including amounts contributed as a result
of a salary reduction agreement and Forfeitures under this Plan allocated
for a Member to the Plan and employer contributions and forfeitures
allocated for the Member to all Related Defined Contribution Plans in the
Aggregation Group; provided, however, that for Plan Years beginning before
January 1, 1985, Compensation Reduction Contributions under this Plan and
employer contributions attributable to compensation reduction or similar
arrangement under Related Defined Contribution Plans shall not be included
in Aggregate Employer Matching Contributions.
(b) "Aggregation Group" means the group of plans in a Mandatory
Aggregation Group, if any, that includes the Plan, unless inclusion of
Related Plans in the Permissive Aggregation Group in the Aggregation Group
would prevent the Plan from being a Top Heavy Plan, in which case
"Aggregation Group" means the group of plans consisting of the Plan and
each other Related Plan in a Permissive Aggregation Group with the Plan.
(i) "Mandatory Aggregation Group" means each plan (considering
the Plan and Related Plans) that, during the Plan Year that contains
the Determination Date or any of the four preceding Plan Years,
(A) had a Member who was a Key Employee, or
(B) was necessary to be considered with a plan in which
a Key Employee participated in order to enable the plan in
which the Key Employee participated to meet the requirements
of Section 401(a)(4) and Section 410 of the Internal Revenue
Code.
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If the Plan is not described in (A) or (B) above, it shall not
be part of a Mandatory Aggregation Group.
(ii) "Permissive Aggregation Group" means the group of plans
consisting of (A) the plans, if any, in a Mandatory Aggregation
Group with the Plan, and (B) any other Related Plan, that when
considered as a part of the Aggregation Group, does not cause the
Aggregation Group to fail to satisfy the requirements of Section
401(a) and Section 410 of the Code. A Related Plan in (B) of the
preceding sentence may include a simplified employee pension plan,
as defined in Code Section 408(k), and a collectively bargained
plan, if when considered as a part of the Aggregation Group such
plan does not cause the Aggregation Group to fail to satisfy the
requirements of Section 401(a)(4) and Section 410 of the Code
considering, if the plan is a multi-employer plan as described in
Code Section 414(f) or a multiple employer plan as described in Code
Section 413(c), benefits under the plan only to the extent provided
to employees of the employer because of service with the employer,
and, if the plan is a simplified employee pension plan, only the
employer's contribution to the plan.
(c) "Determination Date" means, with respect to a Plan Year, the
last day of the preceding Plan Year or, in the case of the first Plan
Year, the last day of such Plan Year. If the Plan is aggregated with other
plans in the Aggregation Group, the Determination Date for each other plan
shall be, with respect to any Plan Year, the Determination Date for each
such other plan which falls in the same calendar year as the Determination
Date for the Plan.
(d) "Key Employee" means, for the Plan Year containing the
Determination Date, any person or the beneficiary of any person who is an
employee or former employee of an Employer or an Affiliate as determined
under Code Section 416(i) and who, at any time during the Plan Year
containing the Determination Date or any of the four (4) preceding Plan
Years (the "Measurement Period"), is a person described in paragraph (i),
(ii), (iii) or (iv), subject to paragraph (v):
(i) An officer of the Employer or an officer of
an Affiliate who:
(A) In any Measurement Period, in the case of Plan Years
beginning after December 31, 1983, is an officer during the
Plan Year and has annual Compensation for the Plan Year in an
amount greater than one hundred and fifty percent (150%) of
the amount in effect under Section 415(c)(1)(A) of
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the Code for the calendar year in which such Plan Year ends
($30,000 in 1984, adjusted in subsequent years as determined
in accordance with regulations prescribed by the Secretary of
the Treasury or his delegate pursuant to the provisions of
Section 415(d) of the Code): and
(B) In any Measurement Period, in the case of a Plan
Year beginning on or before January 1, 1984, is a officer
during the Plan Year, regardless of his Compensation (except
to the extent that applicable law, regulations and rulings
indicate that the one hundred and fifty percent (150%)
requirement set forth in subparagraph (A) above is
applicable).
No more than a total of fifty (50) persons (or, if lesser, the
greater of three (3) persons or ten percent (10%) of all persons or
beneficiaries of persons who are employees or former employees)
shall be treated as Key Employees under this paragraph (i) for any
Measurement Period. In the case of an Employer or an Affiliate which
is not a corporation (I) in any Measurement Period, in the case of a
Plan Year beginning on or before February 28, 1985, no persons shall
be treated as Key Employees under this paragraph (i); and (II) in
any Measurement Period, in the case of a Plan Year beginning after
February 28, 1985, the term "officer" as used in this subsection (d)
shall include administrative executives as described in Section
1.416-1(T- 13) of the Treasury Regulations.
(ii) One (1) of the ten (10) persons who, during a Plan Year
in the Measurement Period:
(A) have annual compensation from the Employer or
Affiliate for such Plan Year greater than the amount in effect
under Section 415(c)(1)(A) of the Code for the calendar year
in which such Plan Year ends $30,000 in 1984, adjusted in
subsequent years as determined in accordance with regulations
prescribed by the Secretary of the Treasury or his delegate
pursuant to the provision of Section 415(d) of the Code; and
(B) own (or are considered as owning within the meaning
of Code Section 318) in such Plan Year, the largest percentage
interests in the Employer or a Corporate Group, in such Plan
Year, provided that no person shall be treated as a Key
Employee under this paragraph unless he owns more
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than one-half of one percent (0.5%) interest in
the Employer or Corporate Group.
No more than a total of ten (10) persons or beneficiaries of
persons who are employees or former employees shall be treated as
Key Employees under this paragraph (2) for any Measurement Period.
(iii) A person who, for a Plan Year in the Measurement Period,
is a more than five percent (5%) owner (or is considered as owning
more than five percent (5%) within the meaning of Code Section 318)
of the Employer or Affiliate.
(iv) A person who, for a Plan Year in the Measurement Period,
is a more than one percent (1%) owner (or is considered as owning
more than one percent (1%) within the meaning of Code Section 318)
of the Employer or Affiliate and has an annual Compensation for such
Plan Year of more than $150,000.
(v) If the number of persons who meet the requirements to be
treated as Key Employees under paragraph (i) or (ii) exceed the
limitation on the number of Key Employees to be counted under
paragraph (i) or (ii), those persons with the highest annual
Compensation in a Plan Year in the Measurement Period for which the
requirements are met and who are within the limitation on the number
of Key Employees will be treated as Key Employees.
If the requirements of paragraph (i) or (ii) are met by a person in
more than one (i) Plan Year in the Measurement Period, each person
will be counted only once under paragraph (i) or (ii). For the
purposes of the preceding sentence under paragraph (i), the Plan
Year in the Measurement Period in which a person who was an officer
and had the highest annual Compensation shall be used to determine
whether the person will be treated as a Key Employee and under
paragraph (i), the Plan Year in the Measurement Period in which the
ownership percentage interest is the greatest shall be used to
determine whether the person will be treated as a Key Employee.
Notwithstanding the above provisions of paragraph (v), a
person may be counted in determining the limitation under both
paragraphs (i) and (ii). In determining the sum of the Present Value
of Accrued Benefits for Key Employees under subsection (f) of this
Section, the Present Value of Accrued Benefits for any person shall
be counted only once.
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(e) "Non-Key Employee" means for the Plan Year containing the
Determination Date a person or the beneficiary of a person who had an
account balance in the Plan or an account balance in any Related Plan in
the Aggregation Group during the Plan Year containing the Determination
Date or any of the four (4) preceding Plan Years and who is not a Key
Employee.
(f) "Present Value of Accrued Benefits" means, for any Plan Year, an
amount equal to the sum of (i), (ii) and (iii) for each person, who in the
Plan Year containing the Determination Date, was a Key Employee or a
Non-Key Employee:
(i) Subject to (iv) below, the value of a Member's Accounts
under the Plan and each Related Defined Contribution Plan in the
Aggregation Group, determined as of the Valuation Date coincident
with or immediately preceding the Determination Date, adjusted for
contributions due as of the Determination Date, as follows:
(A) in the case of a plan not subject to the minimum
funding requirements of Section 412 of the Code, by including
the amount of any contributions actually made after the
valuation date but on or before the Determination Date, and,
in the first plan year of a plan, by including contributions
made after the Determination Date that are allocated as of a
date in that first plan year; and
(B) in the case of a plan that is subject to the minimum
funding requirements, by including the amount of any
contributions that would be allocated as of a date not later
than the Determination Date, plus adjustments to those amounts
as required under applicable rulings, even though those
amounts are not yet required to be contributed or allocated
(e.g., because they have been waived) and by including the
amount of any contributions actually made (or due to be made)
after the valuation date but before the expiration of the
extended payment period in Section 412(c)(10) of the Code.
(ii) Subject to (iv) below, the sum of the actuarial present
values of a person's accrued benefits under each Related Defined
Benefit Plan in the Aggregation Group, expressed as a benefit
commencing at normal retirement date (or the person's attained age,
if later) determined in accordance with Code Section 416(g) based on
the following actuarial assumptions:
(A) Interest rate 5% compounded; and
49
<PAGE>
(B) 80% of the rates underlying the 1984 Unisex Pension
Mortality Table, adjusted by applying a 3-year age setback for
the Member's spouse, where applicable;
The present value of an accrued benefit for any person who is
employed by an Employer maintaining a plan on the
Determination Date is determined as of the most recent
valuation date which is within a 12-month period ending on the
Determination Date, provided however that
(C) for the first plan year of the plan, the present
value for an employee is determined as if the employee had a
termination of employment (1) on the Determination Date or (2)
on such valuation date but taking into account the estimated
accrued benefits as of the Determination Date, and
(D) for the second and subsequent plan years of the
plan, the accrued benefit taken into account for an employee
is not less than the accrued benefit taken into account for
the first plan year unless the difference is attributable to
using an estimate of the accrued benefit as of the
Determination Date for the first plan year and using the
actual accrued benefit as of the Determination for the second
plan year.
For purposes of this paragraph (ii), the valuation date is the
valuation date used by the plan for computing plan costs for minimum
funding, regardless of whether a valuation is performed that year.
If the plan provides for a nonproportional subsidy as
described in Treasury Regulations Section 1.416-1(T- 26), the
present value of accrued benefits shall be determined taking into
account the value of nonproportional subsidized early retirement
benefits and nonproportional subsidized benefit options.
(iii) Subject to (iv) below, the aggregate value of amounts
distributed from the Plan and each Related Plan in the Aggregation
Group during the plan year that includes the Determination Date or
any of the four preceding plan years including amounts distributed
under a termination plan which, if it had not been terminated, would
have been in the Aggregation Group.
(iv) The following rules shall apply in determining the
Present Value of Accrued Benefits:
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<PAGE>
(A) Amounts attributable to qualified voluntary employee
contributions, as defined in Section 219(e) of the Internal
Revenue Code, shall be excluded;
(B) In computing the Present Value of Accrued Benefits
with respect to rollovers or plan-to-plan transfers, the
following rules shall be applied to determine whether amounts
which have been distributed during the five (5) year period
ending on the Determination Date from or accepted into this
Plan or any plan in the Aggregation Group shall be included in
determining the Present Value of Accrued Benefits:
(I) Unrelated Transfers accepted into the Plan or
any plan in the Aggregation Group after December 31,
1983 shall not be included.
(II) Unrelated Transfers accepted on or before
December 31, 1983 and all Related Transfers accepted at
any time into the Plan or any plan in the Aggregation
Group shall be
included.
(III) Unrelated Transfers made from the Plan or
any plan in the Aggregation Group shall be included.
(IV) Related Transfers made from the Plan or any
plan in the Aggregation Group shall be included by the
transferor plan (but shall be counted by the accepting
plan).
The accrued benefit of any individual who has not received any
Compensation from an Employer maintaining the Plan (or a
business which with the Employer is an Affiliate) at any time
during the five (5) year period ending on the Determination
Date shall be excluded in computing the Present Value of
Accrued Benefits.
(g) "Related Plan" means any other defined benefit plan or a defined
contribution plan (as defined in Section 415(k) of the Code) maintained by
an Employer or other Affiliate, respectively called a "Related Defined
Benefit Plan" and a "Related Defined Contribution Plan".
(h) "Related Transfer" means a rollover or a plan-to plan transfer
which is either not initiated by the Employee
51
<PAGE>
or is made between plans each of which is maintained by an Employer or an
Affiliate.
(i) A "Top Heavy Aggregation Group" means the Aggregation Group in
any Plan Year for which, as of the Determination Date, the sum of the
present Values of Accrued Benefits for Key Employees under all plans in
the Aggregation Group exceeds sixty percent (60%) of the sum of the
Present Values of Accrued Benefits for all employees under all plans in
the Aggregation Group; provided that, for purposes of determining the sum
of Present Values of Accrued Benefits for all employees, there shall be
excluded the Present Values of Accrued Benefits of any Non-Key Employee
who was a Key Employee for any Plan Year preceding the Plan Year that
contains the Determination Date. For purposes of applying the special
rules herein with respect to a Super Top Heavy Plan, a Top Heavy
Aggregation Group will also constitute a "Super Top Heavy Aggregation
Group" if in any Plan Year as of the Determination Date, the sum of the
Present Values of Accrued or Key Employees under all plans in the
Aggregation Group exceeds ninety percent (90%) of the sum of the Present
Values of Accrued Benefits for all employees under all plans in the
Aggregation Group.
(j) "Top Heavy Plan" means the Plan in any Plan Year which it is a
member of a Top Heavy Aggregation Group, including a Top Heavy Aggregation
Group consisting solely of the Plan. For purposes of applying the rules
herein with respect to a Super Top Heavy Plan, a Top Heavy Plan will also
constitute a "Super Top Heavy Plan" if the Plan in any Plan Year is a
member of a Super Top Heavy Aggregation Group consisting solely of the
Plan.
(k) "Unrelated Transfer" means a rollover or a plan-to-plan transfer
which is both initiated by the Employee and (a) made from a plan
maintained by an Affiliate to a plan maintained by an Employer which is
not an Affiliate or (b) made to a plan maintained by an Affiliate from a
plan maintained by an Employer which is not an Affiliate.
15.3 Special Top Heavy Provisions. For each Plan Year in which the Plan is
a Top Heavy Plan, the following rules shall apply, except that the special
provisions of this Section 15.3 shall not apply with respect to any employee who
is covered by a collective bargaining agreement between employee representatives
and one or more Employers unless participation by such employee in the Plan has
been agreed to by the parties to such agreement.
(a) Minimum Employer Matching Contributions.
(i) In any Plan Year in which the Plan is a Top Heavy Plan,
the Employers shall make additional Employ-
52
<PAGE>
er Contributions to the Plan as necessary for each Member who is
employed on the last day of the Plan Year and who is a Non-Key
Employee to bring the amount of each Member's Aggregate Employer
Matching Contributions for the Plan Year up to at least three
percent (3%) of each Member's Compensation, or if the Plan is not
required to be included in an aggregation group in order to permit a
defined benefit plan in the Aggregation Group to satisfy the
requirements of Section 401(a)(4) or Section 410 of the Internal
Revenue Code, such lesser amount as is equal to the largest
percentage of a Key Employee's Compensation (as limited in
accordance with Section 15.3(c)) allocated to the Key Employee as
Aggregate Employer Contributions.
(ii) Notwithstanding Section 15.3(a)(1), if there is a Related
Defined Benefit Plan in the Aggregation Group, if a Non-Key Employee
participates in both the Plan and a Related Defined Benefit Plan and
(A) if the Related Defined Benefit Plan provides the
minimum benefit required under Code Section 416(c)(1) for the
Non-Key Employee, then no minimum Employer Contribution shall
be required
under this Section 15.3(a).
(B) if the Related Defined Benefit Plan does not provide
the minimum benefit required under Code Section 416(c)(1) for
the Non-Key Employee, then the minimum Aggregate Employer
Contribution under this Section 15.3(a) shall be five percent
(5%) of such Non-Key Employee's Compensation.
(iii) For purposes of determining whether a Non-Key Employee
is a Member entitled to have minimum Employer Contributions made for
such Member, a Non-Key Employee will be treated as a Member even if
he is not otherwise a Member (or accrues no benefit) under the Plan
because:
(A) such Member has failed to complete the requisite
number of Hours of Service (if any) after becoming a Member in
the Plan,
(B) such Member is excluded from participation in the
Plan (or accrues no benefit) merely because his compensation
is less than a stated amount, or
(C) such Member is excluded from participation in the
Plan (or accrues no benefit) merely because of a failure to
make mandatory employee
53
<PAGE>
contributions or, if the Plan is a Plan described in Section
401(k) of the Code, because of a failure to make elective
401(k) contributions.
(b) Vesting. For each Plan Year in which the Plan is a Top Heavy
Plan and for each Plan Year thereafter, the vesting schedule under the
Plan shall be not less favorable than three (3) year cliff vesting under
which each Member shall be zero percent vested in the Employer
Contributions Account until such Member has three (3) years of Service
after which a Member shall be 100% vested in such Account; provided that
this vesting schedule shall not apply to the Accrued Benefit of any Member
who does not have an Hour of Service in or after a Plan Year in which the
Plan is Top Heavy.
(c) Compensation. For each Plan Year in which the Plan is a Top
Heavy Plan, Compensation taken into account under the Plan shall not
exceed $200,000 (as at 1984, adjusted in subsequent years for the cost of
living adjustments determined in accordance with regulations prescribed by
the Secretary of the Treasury or his delegate pursuant to the provisions
of Section 416(d)(2) of the Code); provided that the $200,000 limitation
of Compensation shall not apply for purposes of Section 4.3 and the
limitations on Employee Contributions in Section 3.1(b). Notwithstanding
the preceding sentence, Compensation in excess of $200,000 (adjusted as
provided in the preceding sentence) for years before the Plan became a Top
Heavy Plan shall be taken into account (to the extent otherwise provided
in the Plan) in determining a person's Accrued Benefit accrued in such
years, and Compensation in excess of $200,000 (adjusted as provided in the
preceding sentence) for years after the Plan ceases to be a Top Heavy Plan
shall be taken into account (to the extent otherwise provided in the Plan)
in determining a person's Accrued Benefit for all years, including years
in which the Plan was a Top Heavy Plan.
(d) Top Heavy Limitations.
(i) In computing the limitations under Section 4.3 hereof, if
the Plan is a Top Heavy Plan and is not a Super Top Heavy Plan, the
special rules of Section 416(h) of the Internal Revenue Code shall
be applied in accordance with applicable regulations and rulings so
that
(A) in determining the denominator of the Defined
Contribution Plan Fraction and the Defined Benefit Plan
Fraction, at each place at which "1.25" would have been used,
"1.00" shall be substituted and
54
<PAGE>
(B) in determining the numerator of the transition
fraction described in Section 415(e)(6)(B) of the Internal
Revenue Code by substituting $41,500 for $51,875 unless the
special requirements of Section 416(h)(2) of the Internal
Revenue Code have been satisfied.
(ii) In computing the limitations under Section 4.3 hereof, if
the Plan is a Super Top Heavy Plan, the special rules of Section
416(h) of the Code shall be applied in accordance with applicable
regulations and rulings so that
(A) in determining the denominator of the Defined
Contribution Plan Fraction and the Defined Benefit Plan
Fraction, at each place at which "1.25" would have been used,
"1.00" shall be substituted and
(B) in determining the numerator of the transitional
fraction described in Section 415(e)(6)(B) of the Internal
Revenue Code, $41,500 shall be substituted for $51,875.
(e) Terminated Plan. If the Plan becomes a Top Heavy Plan after it
has formally been terminated, has ceased crediting for benefit accruals
and vesting and has been or is distributing all plan assets to Members and
their beneficiaries as soon as administratively feasible or if a
terminated plan has distributed all benefits of Members and their
beneficiaries, the provisions of Section 15.3 shall not apply to the Plan.
(f) Frozen Plans. If the Plan becomes a Top Heavy Plan after
contributions have ceased under the Plan but all assets have not been
distributed to Members or their beneficiaries, the provisions of Section
15.3 shall apply to the Plan.
15.4 Effect of Change in Applicable Legislation or Regulation. In the
event that Congress should provide by statute or the Secretary of the Treasury
should provide by regulation a ruling, that the provisions of this Article XV
are no longer necessary for the Plan to meet the requirements of Section 401(a)
or other applicable provisions of the Code, such limitations shall become void
and shall no longer apply, without the necessity of further amendment to the
Plan.
55
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Registration
Statement on Form S-8, pertaining to Sunlite Casual Furniture, Inc. Retirement
Savings & Investment Plan, of our report dated November 11, 1996 with respect to
the consolidated financial statements and schedule of U.S. Industries, Inc.
included in its Annual Report on Form 10-K for the year ended September 30,
1996, filed with the Securities and Exchange Commission.
ERNST & YOUNG LLP
New York, New York
March 3, 1997
EXHIBIT 23.2
CONSENT OF PRICE WATERHOUSE LLP
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated November 11, 1996, which appears on
page 27 of the U.S. Industries, Inc. Annual Report on Form 10-K for the year
ended September 30, 1996.
PRICE WATERHOUSE LLP
Morristown, New Jersey
March 3, 1997
EXHIBIT 23.3
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated February 21, 1995 with respect to the
combined financial statements and schedule of the U.S. Industries Automotive
Group Companies (not presented separately) appearing in U.S. Industries, Inc.'s
Annual Report on Form 10-K for the fiscal year ended September 28, 1996.
DELOITTE & TOUCHE LLP
New York, New York
March 4, 1997
EXHIBIT 24.1
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes GEORGE H. MacLean his true and lawful attorney-in-fact and
agent, with full power of substitution and resubstitution, for him and in his
name, place and stead, in any and all capacities, to sign a registration
statement on Form S-8 of U.S. Industries, Inc. with respect to the SUNLITE
CASUAL FURNITURE, INC. RETIREMENT SAVINGS & INVESTMENT PLAN and to sign and file
any other documents in connection therewith, including amendments thereto, with
the Securities and Exchange Commission, granting unto said attorney-in-fact and
agent, full power and authority to do and perform each 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 said attorney-in-fact and agent, or his substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned have executed this Power of Attorney
as of the 4th day of March 1997.
David H. Clarke John G. Raos
- ---------------------------- -------------------------------
David H. Clarke John G. Raos
Frank R. Reilly Brian C. Beazer
- ---------------------------- -------------------------------
Frank R. Reilly Brian C. Beazer
John J. McAtee, Jr.
- ---------------------------- -------------------------------
John J. McAtee, Jr. The Hon. Charles H. Price II
Royall Victor III
- ---------------------------- -------------------------------
Sir Harry Solomon Royall Victor III
Mark Vorder Bruegge James O'Leary
- ---------------------------- -------------------------------
Mark Vorder Bruegge James O'Leary
