This filing constitutes Amendment No.10 to the State
ment on Schedule 13D (as heretofore amended, the "Schedule 13D")
filed on behalf of Marshall Tulin, John Tulin, Raymond Vise and
The New Swank, Inc. Retirement Trust (the "Retirement Plan
Trust") (the successor, by virtue of an amendment and restate-
ment more fully described below in this Amendment, to the Swank,
Inc. Employees' Stock Ownership Trust (the "First Trust"), the
Swank, Inc. Employees' Stock Ownership Trust No. 2 (the "Second
Trust") and the Swank, Inc. Savings Trust (the "Savings Trust"))
with respect to shares of Common Stock, $.10 par value (the
"Common Stock"), of Swank, Inc. (the "Corporation").
Item 1. Security and Issuer.
This Schedule relates to the Common Stock of the Cor
poration. The Corporation's principal executive offices are
located at 6 Hazel Street, Attleboro, Massachusetts 02703.
Item 2. Identity and Background.
On February 10, 1995, the Swank,Inc. Employees'Stock
Ownership Plan No. 1 (the "First Plan"),the Swank,Inc. Employ
ees' Stock Ownership Plan No. 2 (the "Second Plan") and the
Swank, Inc. Employees' Savings Plan (the "Savings Plan") were
merged effective as of January 1, 1994 into The New Swank,Inc.
Retirement Plan (the "Retirement Plan") and amended and restated
effective as of January 1, 1989. In connection with the merger,
the First Trust, the Second Trust and the Savings Trust, the
trust organized in connection with the establishment of the Sav
ings Plan, were amended and restated as of January 1, 1994 into
the Retirement Plan Trust. Marshall Tulin, John Tulin and
Raymond Vise, each of whom were the trustees under the First
Trust, the Second Trust and the Savings Trust, are the trustees
under the Retirement Plan Trust (such trustees, in their capaci
ties as trustees under the Retirement Plan Trust being herein
after referred to as the "Retirement Plan Trustees"). The
address of the Retirement Plan Trust is c/o the Corporation, 6
Hazel Street, Attleboro, Massachusetts 02703. The business
address of Marshall Tulin, President and a Director of the Cor
poration, and John Tulin, Executive Vice President and a Direc
tor of the Corporation, is 90 Park Avenue, New York, New York
10016. The residence address of Raymond Vise, a retired Senior
Vice President and a current Director of the Corporation, is 8
El Paseo, Irvine, California 92715. Each of the Retirement Plan
Trustees is a citizen of the United States of America.
During the past five years, neither the Retirement
Plan Trust nor any of the Retirement Plan Trustees has been (a)
convicted in a criminal proceeding (excluding traffic violations
or similar misdemeanors) or (b) a party to a civil proceeding of
a judicial or administrative body or competent jurisdiction and
as a result of such proceeding it or any of them was or is sub
ject to a judgment, decree or final order enjoining future vio
lations of, or prohibiting or mandating activities subject to,
Federal or State securities laws or finding any violation with
respect to such laws.
Item 3. Source and Amount of Funds or Other
Consideration
Reference is made to Item 4 of this Schedule.
Item 4. Purpose of Transaction.
Between March 1, 1991 (the date of the most recent
prior amendment to the Schedule 13D) and February 10, 1995, the
following transactions have occurred:
On May 17, 1991, July 25, 1991, and August
30, 1991, the First Trust distributed 17,550, 18,728
and 2,883 shares of Common Stock, respectively, to
employees of the Corporation upon termination of their
employment. On February 1, 1992, the First Trust sold
56,582 shares of Common Stock to the Savings Plan, and
on February 29, 1992, the First Trust purchased 86,807
shares of Common Stock from the Second Trust and 7,066
shares from the Savings Plan, in each case at the fair
market value per share at December 31 of the preceding
year, in the case of retiring employees of the Corpo
ration, or at the date of death, in the case
of deceased employees, for the benefit of employees who
elected to receive cash in lieu of shares as permitted
by the First Trust (each such applicable date, the
"Valuation Date"). On March 23, 1992, April 14, 1992,
April 23, 1992, June 2, 1992, 30, 1992 and Sep
tember 3, 1992, the First Trust distributed 3,500,
16,175, 8,273, 426, 4,837 and 9,179 shares of Common
Stock, respectively, to employees of the Corporation
upon termination of their employment. On December 16,
1992, the First Trust purchased 108,384 shares of Com
mon Stock from the Second Trust and sold 14,510 shares
of Common Stock to the Savings Plan, in each case at
the fair market value per share on the applicable
Valuation Dates. On April 8, 1993, May 3, 1993, May
19, 1993, June 1, 1993, June 14, 1993 and June 28,
1993, the First Trust distributed 93,273, 4,456,
4,350, 2,461, 27,745 and 26,636 shares of Common
Stock, respectively, to employees of the Corporation
upon termination of their employment. On July 29,
1993, the First Trust sold 152,665 shares of Common
Stock to the Savings Plan at the fair market value per
share on the applicable Valuation Dates. On December
31, 1993, the First Trust purchased 8,838 and 1,187
shares of Common Stock from the Second Trust and the
Savings Plan, respectively, in each case at the fair
market value per share on the applicable Valuation
Dates. On April 14, 1994, May 1, 1994, May 17, 1994,
June 21, 1994, September 7, 1994 and October 26, 1994,
the First Trust distributed 35,143,17,665, 7,112,
10,332, 921 and 12,163 shares of Common Stock, respec
tively, to employees of the Corporation upon termina
tion of their employment.
On May 17, 1991, July 25, 1991, and August
30, 1991, the Second Trust distributed 15,923, 19,098
and 461 shares of Common Stock, respectively, to
employees of the Corporation upon termination of their
employment. On February 29, 1992, the Second Trust
sold 86,807 shares of Common Stock to the First Trust
at the fair market value per share on the applicable
Valuation Dates. On April 14, 1992 and April 23,
1993, the Second Trust distributed 19,400 and 9,335
shares of Common Stock, respectively, to employees of
the Corporation upon termination of their employment.
On December 16, 1992, the Second Trust sold 108,384
shares of Common Stock to the First Trust at the fair
market value per share on the applicable Valuation
Dates. On April 8, 1993, June 1, 1993, June 14, 1993
and June 28, 1993, the Second Trust distributed
77,382, 3,827, 35,297 and 22,520 shares of Common
Stock, respectively, to employees of the Corporation
upon termination of their employment. On July 29,
1993, the Second Trust sold 57,193 shares of Common
Stock to the Savings Plan at the fair market value per
share on the applicable Valuation Dates. On December
31, 1993, the Second Trust sold 8,838 shares of Common
Stock to the First Trust at the fair market value per
share on the applicable Valuation Date. On May 1,
1994, May 17, 1994 and June 21, 1994, the Second Trust
distributed 15,374, 5 and 9,114 shares of Common
Stock, respectively, to employees of the Corporation
upon termination of their employment.
On May 17, 1991, July 25, 1991, and August
30, 1991, the Savings Plan distributed 833, 776 and 57
shares of Common Stock, respectively, to employees of the
Corporation upon termination of their employment.
On February 1, 1992, the Savings Plan purchased 56,582
shares of Common Stock from the First Trust, and on
February 29, 1992, the Savings Plan sold 7,066 shares
of Common Stock to the First Trust, in each case at
the fair market value per share on the applicable
Valuation Dates. On April 14, 1992, April 23, 1992,
June 2, 1992, July 30, 1992 and September 3, 1992, the
Savings Plan distributed 338, 331, 48, 129 and 219
shares of Common Stock, respectively, to employees of
the Corporation upon termination of their employment.
On December 16, 1992, the Savings Plan purchased
14,510 shares of Common Stock from the First Trust
at the fair market value per share on the applicable
Valuation Dates. On April 8, 1993, May 3, 1993, May
19, 1993, June 1, 1993, June 14, 1993 and June 28,
1993, the Savings Plan distributed 4,994, 308, 332,
331, 649 and 1,321 shares of Common Stock, respec
tively, to employees of the Corporation upon termina-
tion of their employment. On July 29, 1993, the Sav
ings Plan purchased 152,665 shares from the First
Trust and 57,193 shares of Common Stock from the Sec
ond Trust, in each case at the fair market value per
share on the applicable Valuation Dates. On December 31,
1993, the Savings Plan sold 1,187 shares of Common
Stock to the First Trust at the fair market value per
share on the applicable Valuation Dates. On April 14,
1994, May 1, 1994, May 17, 1994, June 21, 1994 and
October 26, 1994, the Savings Plan distributed 1,491,
820, 485, 461 and 308 shares of Common Stock, respec
tively, to employees of the Corporation upon termina-
tion of their employment.
As described above in Item 2, on February
10, 1995, the First Plan, the Second Plan and the Sav
ings Plan were merged effective as of January 1, 1994
into the Retirement Plan and amended and restated
effective as of January 1, 1989, and the First Trust,
the Second Trust and the Savings Trust were amended
and restated as of January 1, 1994 into the Retirement
Plan Trust. On February 10, 1995, the Retirement Plan
Trust owned 11,246,560 shares of Common Stock, which
amount includes shares of Common Stock previously held
by the First Trust, the Second Trust and the Savings
Trust prior to the merger and the amendment and
restatement of the First Plan, the Second Plan and the
Savings Plan and the amendment and restatement of the
First Trust, the Second Trust and the Savings Trust.
Item 5. Interest in Securities of the Issuer.
Under the Retirement Plan and the Retirement Plan
Trust, (a) participants may direct the Retirement Plan Trustees
(i) as to voting on all matters with respect to shares of Common
Stock purchased with the proceeds of loans and allocated to
participants' ESOP I accounts in the Retirement Plan, and (ii) as
to voting on certain significant corporate events such as merg
ers,consolidations,recapitalizations,reclassifications,liq
uidations, dissolutions or a sale of substantially all of a
trade or business of the Corporation (collectively, "Significant
Corporate Events") with respect to shares of Common Stock not
purchased with the proceeds of loans and allocated to partici
pants' ESOP I accounts, (b) the Retirement Plan Trustees may
vote shares of Common Stock not allocated to participants' ESOP
I accounts in their discretion (other than on Significant Corpo
rate Events, in which event unallocated shares, as well as allo
cated shares as to which no voting instructions from partici
pants in the Retirement Plan are received, are required to be
voted in the same proportion as shares allocated to ESOP I
accounts as to which voting instructions are received), (c) the
Retirement Plan Trustees may vote shares of Common Stock not
allocated to participants' ESOP II accounts in their discretion
and may vote shares of Common Stock allocated to participants'
ESOP II accounts in the Retirement Plan in their discretion
except for voting on Significant Corporate Events, in connection
with which participants may direct the Retirement Plan Trustees
as to voting (shares allocated to ESOP II accounts as to which
no voting instructions from participants in the Retirement Plan
are received on Significant Corporate Events are required to be
voted in the same proportion as shares allocated to partici-
pants' ESOP II accounts as to which voting instructions are
received), and (d) participants may direct the Retirement Plan
Trustees as to voting on all matters with respect to shares of
Common Stock held in participants' 401(k) accounts under the
Retirement Plan. Under the Retirement Plan Trust, the Retirement
Plan Trustees share dispositive power as to shares of Common
Stock owned by the Retirement Plan Trust as follows: (e) shares
of Common Stock allocated to participants' ESOP I accounts may
be disposed of only with the consent of the respective partici
pants and unallocated shares of Common Stock may not be disposed
of in a greater percentage than allocated shares in any transac
tion or series of transactions, (f) shares of Common Stock allo
cated to ESOP II accounts may be disposed of only at the direc
tion of the administrative committee of the Retirement Plan
(presently consisting of Messrs. Marshall Tulin, John Tulin,
Andrew C. Corsini and Arthur Gately), and unallocated shares
may be disposed of in the discretion of the Retirement Plan Trust
ees, and (g) shares of Common Stock held in 401(k) accounts may
be disposed of in the discretion of the Retirement Plan Trustees.
<PAGE>
The following table sets forth information as of
February 10, 1995 as to the shares of Common Stock beneficially
owned by the Retirement Plan Trust and each of the Retirement
Plan Trustees:
<TABLE>
<CAPTION>
Percentage of
Beneficial No.of shares Outstanding
Owner Shares
<S> <C> <C>
The New Swank, Inc. 11,246,560 68.3%
Retirement Plan Trust
Marshall Tulin (1)(2)(3) 5,260,103 31.5%
John Tulin (1)(2)(4) 4,804,014 28.8%
Raymond Vise (1)(5) 4,398,508 26.7%
</TABLE>
___________________
(1) Each of the amounts set forth opposite the names of
Marshall Tulin, John Tulin and Raymond Vise includes
4,392,102 of the shares of Common Stock listed above as owned
by the Retirement Plan. These amounts include (a) 237,578
shares of Common Stock not purchased with the proceeds of
loans and allocated to participants' ESOP I accounts in the
Retirement Plan, as to which shares of Common Stock such
participants may direct the Retirement Plan Trustees as to voting
only on Significant Corporate Events and as to which the
Retirement Plan Trustees may vote, on all other matters, in
their discretion, (b) 3,363,980 shares of Common Stock allocated
to participants' ESOP II accounts in the Retirement Plan as to
which shares of Common Stock participants may direct the Retire
ment Plan Trustees as to voting only on Significant Corporate
Events and as to which the Retirement Plan Trustees may vote,
on all other matters, in their discretion, and (c) 790,544 shares
of Common Stock held in participants' 401(k) accounts, which,
in each case, may be disposed of in the discretion of the
Retirement Plan Trustees.
(2) Each of these amounts includes 211,209 shares of
Common Stock which Messrs. Marshall Tulin and John Tulin each
have the right to acquire through the exercise of stock options.
(3) This amount includes 3,964 shares of Common Stock
allocated to Marshall Tulin's ESOP I account and as to which he
may direct the Retirement Plan Trustees as to voting. This
amount also includes 343,022 shares of Common Stock owned by
Marshall Tulin's wife, as to which shares Marshall Tulin
disclaims beneficial ownership. This Amendment reports that
Marshall Tulin has sole voting and dispositive power as to
656,792 shares, shared voting power as to 3,601,558 shares and
shared dispositive power as to 790,544 shares.
(4) This amount includes 62,351 shares of Common Stock
allocated to John Tulin's ESOP I account and as to which he may
direct the Retirement Plan Trustees as to voting. This amount
also includes 3,180 shares of Common Stock owned by John
Tulin's wife, as to which shares John Tulin disclaims
beneficial ownership. This Amendment reports that John Tulin
has sole voting and dispositive power as to 200,703 shares,
shared voting power as to 3,601,558 shares and shared
dispositive power as to 790,554 shares.
(5) This Amendment reports that Raymond Vise has sole
voting and dispositive power as to 6,406 shares, shared voting
power as to 3,601,558 shares and shared dispositive power as
to 790,554 shares.
Item 6. Contracts, Arrangements, Understandings or
Relationships With Respect to Securities of
the Issuer.
There are no contracts, arrangements, understandings
or relationships (legal or otherwise) among the Retirement Plan
Trustees and the Retirement Plan Trust or between the Retirement
Plan Trustees and any other person with respect to any securi-
ties of the Corporation, including but not limited to the trans-
fer or voting of any of the securities, finder's fees, joint
ventures, loan or option arrangements, puts or calls, guarantees
of profits, division of profits or loss, or the giving or with-
holding or proxies except (a) the Retirement Plan, (b) the
Retirement Plan Trust, (c) incentive stock option contracts
dated June 23, 1987, June 24, 1987 and October 17, 1991, respec-
tively, between Marshall Tulin and the Corporation , (d) incen-
tive stock option contracts dated June 23, 1987, June 24, 1987
and October 17, 1991, respectively, between John Tulin and the
Corporation, and (e) non-qualified stock option contract dated
December 31, 1994 between Raymond Vise and the Corporation.
Item 7. Material to be Filed as Exhibits.
1. The New Swank, Inc. Retirement Plan.
2. The New Swank, Inc. Retirement Plan Trust Agree-
ment made as of January 1, 1994.
3. Incentive stock option contracts dated June 23,
1987, June 24, 1987 and October 17, 1991, respectively, between
Marshall Tulin and the Corporation.
4. Incentive stock option contracts dated June 23,
1987, June 24, 1987 and October 17, 1991, respectively, between
John Tulin and the Corporation.
5. Non-qualified stock option contract dated Decem-
ber 31, 1994 between Raymond Vise and the Corporation.
<PAGE>
SIGNATURES
After reasonable inquiry, and to the best of my knowl-
edge and belief, I certify that the information set forth in
this statement is true, complete and correct.
Dated: February 21, 1995
/s/ Marshall Tulin
Marshall Tulin
/s/ John Tulin
John Tulin
/s/ Raymond Vise
Raymond Vise
THE NEW SWANK, INC.
RETIREMENT PLAN TRUST
By:/s/ John Tulin
Name: John Tulin
Title: Trustee
<PAGE>
Exhibit Index
Exhibit No. Documents Page No.
1 The New Swank, Inc. Retirement Plan
2 The New Swank, Inc. Retirement Plan Trust
Agreement made as of January 1, 1994
3 Incentive stock option contracts dated June 23,
1987, June 24, 1987 and October 17,1991,
respectively, between Marshall Tulin and the
Corporation
4 Incentive stock option contracts dated June 23, 1987,
June 24, 1987 and October 17, 1991, respectively,
between John Tulin and the Corporation
5 Non-qualified stock option contract dated
December 31, 1994 between Raymond Vise and
the Corporation
<PAGE>
Exhibit No. 1
<PAGE>
Exhibit No. 2
<PAGE>
Exhibit No. 3
<PAGE>
Exhibit No. 4
<PAGE>
Exhibit No. 5
<PAGE>
INCENTIVE STOCK OPTION CONTRACT
THIS INCENTIVE STOCK OPTION CONTRACT made as of OCT
OBER 17 , 1991, between SWANK, INC., a Delaware corporation
(herein referred to as the"Company"), and JOHN TULIN (herein
referred to as the "Optionee").
W I T N E S S E T H:
1. The Company, in accordance with the allotment
made by the Stock Option Committee, and subject to the terms and
conditions of the 1987 Incentive Stock Option Plan of the Com
pany ("Plan"), grants as of the date hereof, to the Optionee, an
option to purchase an aggregate of 40,000 shares of the Common
Stock, $.10 par value, of the Company ("Common Stock") at $.9375
per share, being the fair market value of such stock on the date
hereof.
2. The term of the option shall be ten years from the
date hereof, subject to earlier termination as provided in
the Plan. The option may be exercised in whole or in part and
from time to time, commencing one year from the date hereof but
prior to the end of the term of the option, by giving written
notice to the Company at its principal financial office, pres
ently 6 Hazel Street, Attleboro, Massachusetts 02703, Attention:
Chief Financial Officer, specifying the number of shares pur
chased and accompanied by payment in full (in the manner
required by the Plan) of the aggregate purchase price therefor.
3. The Optionee agrees to make his or her services
available to the Company and its subsidiaries, at the election
of the Company, for a period of one year from the later of (i)
the date hereof or (ii) the termination date of any existing
employment contract; provided, however, that nothing in the Plan
or herein shall confer upon the Optionee any right to continue
in the employ of the Company or its subsidiaries or interfere in
any way with the right of the Company or its subsidiaries to
terminate such employment at any time during such periods with
out liability to the Company or its subsidiaries.
4. The Optionee represents and agrees that, in the
event of any exercise of the option, the shares of Common Stock
issuable upon exercise of the option will be acquired for
investment and not with a view to distribution thereof, and
agrees that such shares shall not be sold except in compliance
with the applicable provisions of the Securities Act of 1933, as
amended (the "Act"). The foregoing notwithstanding, at such
time as the shares of Common Stock issuable upon exercise of the
option have been registered pursuant to an effective registra
tion statement under the Act, the foregoing restriction on the
distribution of such shares shall be inoperative.Nothing con
tained herein or in the Plan, however, shall be construed as
requiring the Company to effect such registration.
5. If the Optionee sells or otherwise disposes of
any of the shares of Common Stock acquired pursuant to the exer
cise of the option or received in exchange for such shares
within two years from the date hereof or one year after the date
of transfer of such shares to him or her pursuant to the exer
cise of the option, the Optionee shall notify the Company
thereof within 30 days after such disposition, providing the
Company with such information as the Company may reasonably
require or request to determine its obligation to withhold any
income or other taxes by reason of such disposition, and pay to
the Company on demand in cash an amount necessary to satisfy
such obligation.
<PAGE>
6. The Company and the Optionee further agree that
they will both be subject to and bound by all of the terms and
conditions of the Plan, a copy of which is attached hereto and
made a part hereof. In the event the employment of the Optionee
terminates or in the event of the Optionee's death or dis
ability, the Optionee's rights hereunder shall be governed by and
subject to the provisions of the Plan. In the event of a
conflict between the terms of this Contract and the Plan, the
terms of the Plan shall govern.
7. The option is not transferable otherwise than by
will or the laws of descent and distribution and may be exer
cised, during the lifetime of the Optionee, only by the
Optionee.
8. The Plan was adopted prior to the promulgation of
final regulations by the Treasury Department under Section 422
(formerly Section 422A) of the Internal Revenue Code of 1986, as
amended. Accordingly, as it is intended that the options
granted under the Plan be incentive stock options within the
meaning of such section, the Optionee agrees that the Company
may amend the Plan and the options granted to the Optionee under
the Plan in any respect necessary or appropriate to bring the
Plan and such options into compliance with any such regulations.
9. This Contract shall be binding upon and inure to
the benefit of any successor or assignee of the Company and any
executor, administrator or legal representative entitled by law
to the Optionee's rights hereunder.
10. This Contract shall be governed by and construed
in accordance with the laws of the State of New York.
11. The invalidity or illegality of any provision
herein or in the Plan shall not affect the validity of any other
such provision.
SWANK, INC.
By: \s\ A.C. CORSINI
ANDREW C.CORSINI,
TREASURER
\s\JOHN TULIN
Optionee JOHN TULIN
<PAGE>
INCENTIVE STOCK OPTION CONTRACT
THIS INCENTIVE STOCK OPTION CONTRACT made as of the
23rd day June,, 1987 , between SWANK, INC., a Delaware corpora-
tion (herein referred to as "Company"), and MARSHALL TULIN
(herein referred to as 'Optionee"),
W I T N E S S E T H:
1. The Company, in accordance with the allotment
made by the Stock Option Committee, and subject to the terms and
conditions of the Amended and Restated 1981 Incentive Stock
option Plan of the Company ("Plan"), grants as of the date
hereof, to the Optionee an option to purchase an aggregate of
6,600 shares of the Common Stock, $1 par value, of the Company
("Common Stock") at $ 15.00 per share, being the fair market
value of such stock on the date hereof.
2. The term of the option shall be ten years from
the date hereof, subject to earlier termination as provided in
the Plan. The option may be exercised in whole or in part and
from time to time, commencing September 23, 1987, but prior to
the end of the term of the option, by giving written notice to
the Company at its principal office, presently 6 Hazel Street,
Attleboro, Massachusetts, specifying the number of shares pur-
chased and accompanied by payment in full of the aggregate pur-
chase price therefor.
3. The Optionee agrees to make his services avail-
able to the Company and its subsidiaries, at the election of the
Company, for a period of one year from the later of (i) the date
hereof and (ii) the termination date of any existing employment
contract; provided, however, that nothing in the Plan or herein
shall confer upon the Optionee any right to continue in the
employ of the Company or its subsidiaries or interfere in any
way with the right of the Company or its subsidiaries to termi-
nate such employment at any time during such periods without
liability to the Company or its subsidiaries.
4. The Optionee represents and agrees that in the
event of any exercise of the option, the shares of Common Stock
issuable upon exercise of the option will be acquired for
investment and not with a view to distribution thereof, and
agrees that such shares shall not be sold except in compliance
with the applicable provisions of the Securities Act of 1933, as
amended (the "Act"). The foregoing notwithstanding, at such
time as the shares of Common Stock issuable upon exercise of the
option have been registered pursuant to an effective registra-
tion statement under the Act, the foregoing restriction on the
-1-
<PAGE>
<PAGE>
distribution of such shares shall be inoperative.
5. If the Optionee sells or otherwise disposes of
any of the shares of Common Stock acquired pursuant to the exer-
cise of the option or received in exchange for such shares,
within two years from the date hereof or one year after the date
of transfer of shares to him pursuant to the exercise of the
option, the Optionee shall notify the Company thereof provide
the Company with such information as the Company may reasonably
require or request to determine its obligation to withhold any
income or other taxes by reason of such disposition, and pay to
the Company on demand in cash an amount necessary to satisfy
such obligation.
6. The Company and the Optionee further agree that
they will both be subject to and bound by all of the terms and
conditions of the Plan, a copy of which is attached hereto and
made a part hereof. In the event the employment of the Optionee
terminates or in the event of his death or disability, his
rights hereunder shall be governed by and subject to the provi-
sions of the Plan. In the event of a conflict between the terms
of the option and the Plan, the terms of the Plan shall govern.
7. The option is not transferable otherwise than by
will or the laws of descent and distribution and may be exer-
cised, during the lifetime of the Optionee, only by him.
8. The Plan has been adopted prior to the promulga-
tion of final regulations by the Treasury Department under Sec-
tion 422A of the Internal Revenue Code of 1986, as amended (the
"Code"). Accordingly, as it is intended that the options
granted under the Plan be incentive stock options within the
meaning of such section, the Optionee agrees that the Company
may amend the Plan and the options granted to the Optionee under
the Plan in any respect necessary or appropriate to bring the
Plan and such options into compliance with any such rules and
regulations. Any options granted to Optionee under the Plan
shall be subject to the approval of the Plan by the stockholders
of the Company.
9. This contract shall be binding upon and inure to
the benefit of any successor or assignee of the Company and to
any executor, administrator or legal representative entitled by
law to the Optionee's rights hereunder.
-2-
<PAGE>
<PAGE>
IN WITNESS WHEREOF, we have hereunto set our hands in
duplicate as of the day and year first above written.
SWANK, INC.
By: \s\ A.C. CORSINI
\s\ MARSHALL TULIN
Optionee
-3-
<PAGE>
INCENTIVE STOCK OPTION CONTRACT
THIS INCENTIVE STOCK OPTION CONTRACT made as of the
24th day June 1987 , between SWANK, INC., a Delaware corporation
(herein referred to as "Company"), and MARSHALL TULIN (herein
referred to as "Optionee").
W I T N E S S E T H:
1. The Company, in accordance with the allotment
made by the Stock Option Committee, and subject to the terms and
conditions of the 1987 Incentive Stock Option Plan of the Com-
pany ("Plan"), grants as of the date hereof, to the Optionee an
option to purchase an aggregate of 6,700 shares of the Common
Stock, $1 par value, of the Company ("Common Stock") at $14.875
per share, being the fair market value of such stock on the date
hereof.
2. The term of the Option shall be ten years from
the date hereof, subject to earlier termination as provided in
the Plan. The option may be exercised in whole or in part and
from time to time, commencing one year from the date hereof but
prior to the end of the term of the option, by giving written
notice to the Company at its principal office, presently 6 Hazel
Street, Attleboro, Massachusetts, specifying the number of
shares purchased and accompanied by payment in full of the
aggregate purchase price therefor.
3. The Optionee agrees to make his services avail-
able to the Company and its subsidiaries, at the election of the
Company, for a period of one year from the later of (i) the date
hereof and (ii) the termination date of any existing employment
contract; provided, however, that nothing in the Plan or herein
shall confer upon the Optionee any right to continue in the
employ of the Company or its subsidiaries or interfere in any
way with the right of the Company or its subsidiaries to termi-
nate such employment at any time during such periods without
liability to the Company or its subsidiaries.
4. The Optionee represents and agrees that in the
event of any exercise of the option, the shares of Common Stock
issuable upon exercise of the option will be acquired for
investment and not with a view to distribution thereof, and
agrees that such shares shall not be sold except in compliance
with the applicable provisions of such Act. The foregoing
notwithstanding, at such time as the shares of Common Stock
issuable upon exercise of the option have been registered pursu-
ant to an effective registration statement under the Securities
Act of 1933, as amended, the foregoing restriction on the
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<PAGE>
<PAGE>
distribution of such shares shall be inoperative.
5. If the Optionee sells or otherwise disposes of
any of the shares of Common Stock acquired pursuant to the exer-
cise of the option or received in exchange for such shares,
within two years from the date hereof or one year after the date
of transfer of shares to him pursuant to the exercise of the
option, the Optionee shall notify the Company thereof provide
the Company with such information as the Company may reasonably
require or request to determine its obligation to withhold any
income or other taxes by reason of such disposition, and pay to
the Company on demand in cash an amount necessary to satisfy
such obligation.
6. The Company and the Optionee further agree that
they will both be subject to and bound by all of the terms and
conditions of the Plan, a copy of which is attached hereto and
made a part hereof. In the event the employment of the Optionee
terminates or in the event of his death or disability, his
rights hereunder shall be governed by and subject to the provi-
sions of the Plan. In the event of a conflict between the terms
of the option and the Plan, the terms of the Plan shall govern.
7. The option is not transferable otherwise than by
will or the laws of descent and distribution and may be exer-
cised, during the lifetime of the Optionee, only by him.
8. The Plan has been adopted prior to the promulga-
tion of final regulations by the Treasury Department under Sec-
tion 422A of the Code. Accordingly, as it is intended that the
options granted under the Plan be incentive stock options within
the meaning of such section, the Optionee agrees that the Com-
pany may amend the Plan and the options granted to the Optionee
under the Plan in any respect necessary or appropriate to bring
the Plan and such options into compliance with any such rules
and regulations. Any options granted to Optionee under the Plan
shall be subject to the approval of the Plan by the stockholders
of the Company.
9. This contract shall be binding upon and inure to
the benefit of any successor or assignee of the Company and to
any executor, administrator or legal representative entitled by
law to the Optionee's rights hereunder.
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<PAGE>
<PAGE>
IN WITNESS WHEREOF, we have hereunto set our hands in
duplicate as of the day and year first above written.
SWANK, INC.
By: A.C. CORSINI
Senior Vice President-
Treasurer
MARSHALL TULIN
Optionee
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<PAGE>
INCENTIVE STOCK OPTION CONTRACT
THIS INCENTIVE STOCK OPTION CONTRACT made as of the
24th day June , 1987 , between SWANK, INC., a Delaware corpora-
tion (herein referred to as "Company"), and JOHN TULIN (herein
referred to as "Optionee"),
W I T N E S S E T H:
1. The Company, in accordance with the allotment
made by the Stock Option Committee, and subject to the terms and
conditions of the 1987 Incentive Stock Option Plan of the Com-
pany ("Plan"), grants as of the date hereof, to the Optionee an
option to purchase an aggregate of 6,700 shares of the Common
Stock, $1 par value, of the Company ("Common Stock") at $14.875
per share, being the fair market value of such stock on the date
hereof.
2. The term of the option shall be ten years from
the date hereof, subject to earlier termination as provided in
the Plan. The option may be exercised in whole or in part and
from time to time, commencing one year from the date hereof but
prior to the end of the term of the option, by giving written
notice to the Company at its principal office, presently 6 Hazel
Street, Attleboro, Massachusetts, specifying the number of
shares purchased and accompanied by payment in full of the
aggregate purchase price therefor.
3. The Optionee agrees to make his services avail-
able to the Company and its subsidiaries, at the election of the
Company, for a period of one year from the later of (i) the date
hereof and (ii) the termination date of any existing employment
contract; provided, however, that nothing in the Plan or herein
shall confer upon the Optionee any right to continue in the
employ of the Company or its subsidiaries or interfere in any
way with the right of the Company or its subsidiaries to termi-
nate such employment at any time during such periods without
liability to the Company or its subsidiaries.
4. The Optionee represents and agrees that in the
event of any exercise of the option, the shares of Common Stock
issuable upon exercise of the option will be acquired for
investment and not with a view to distribution thereof, and
agrees that such shares shall not be sold except in compliance
with the applicable provisions of such Act. The foregoing
notwithstanding, at such time as the shares of Common Stock
issuable upon exercise of the option have been registered pursu-
ant to an effective registration statement under the Securities
Act of 1933, as amended, the foregoing restriction on the
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<PAGE>
<PAGE>
distribution of such shares shall be inoperative.
5. If the Optionee sells or otherwise disposes of
any of the shares of Common Stock acquired pursuant to the exer-
cise of the option or received in exchange for such shares,
within two years from the date hereof or one year after the date
of transfer of shares to him pursuant to the exercise of the
option, the Optionee shall notify the Company thereof provide
the Company with such information as the Company may reasonably
require or request to determine its obligation to withhold any
income or other taxes by reason of such disposition, and pay to
the Company on demand in cash an amount necessary to satisfy
such obligation.
6. The Company and the Optionee further agree that
they will both be subject to and bound by all of the terms and
conditions of the Plan, a copy of which is attached hereto and
made a part hereof. In the event the employment of the Optionee
terminates or in the event of his death or disability, his
rights hereunder shall be governed by and subject to the provi-
sions of the Plan. In the event of a conflict between the terms
of the option and the Plan, the terms of the Plan shall govern.
7. The option is not transferable otherwise than by
will or the laws of descent and distribution and may be exer-
cised, during the lifetime of the Optionee, only by him.
8. The Plan has been adopted prior to the promulga-
tion of final regulations by the Treasury Department under Sec-
tion 422A of the Code. Accordingly, as it is intended that the
options granted under the Plan be incentive stock options within
the meaning of such section, the Optionee agrees that the Com-
pany may amend the Plan and the options granted to the Optionee
under the Plan in any respect necessary or appropriate to bring
the Plan and such options into compliance with any such rules
and regulations. Any options granted to Optionee under the Plan
shall be subject to the approval of the Plan by the stockholders
of the Company.
9. This contract shall be binding upon and inure to
the benefit of any successor or assignee of the Company and to
any executor, administrator or legal representative entitled by
law to the Optionee's rights hereunder.
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<PAGE>
<PAGE>
IN WITNESS WHEREOF, we have hereunto set our hands in
duplicate as of the day and year first above written.
SWANK, INC.
By: \s\ A.C. CORSINI
Senior Vice President -
Treasurer
\s\ MARSHALL TULIN
Optionee
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<PAGE>
INCENTIVE STOCK OPTION CONTRACT
THIS INCENTIVE STOCK OPTION CONTRACT made as of OCTO-
BER 17 , 1991, between SWANK, INC., a Delaware corporation
(herein referred to as the "Company"), and MARSHALL TULIN
(herein referred to as the "Optionee").
W I T N E S S E T H:
1. The Company, in accordance with the allotment
made by the Stock Option Committee, and subject to the terms and
conditions of the 1987 Incentive Stock Option Plan of the Com-
pany ("Plan"), grants as of the date hereof, to the Optionee, an
option to purchase an aggregate of 40,000 shares of the Common
Stock, $.10 par value, of the Company ("Common Stock") at $.9375
per share, being the fair market value of such stock on the date
hereof.
2. The term of the option shall be ten years from
the date hereof, subject to earlier termination as provided in
the Plan. The option may be exercised in whole or in part and
from time to time, commencing one year from the date hereof but
prior to the end of the term of the option, by giving written
notice to the Company at its principal financial office, pres-
ently 6 Hazel Street, Attleboro, Massachusetts 02703, Attention:
Chief Financial Officer, specifying the number of shares pur-
chased and accompanied by payment in full (in the manner
required by the Plan) of the aggregate purchase price therefor.
3. The Optionee agrees to make his or her services
available to the Company and its subsidiaries, at the election
of the Company, for a period of one year from the later of (i)
the date hereof or (ii) the termination date of any existing
employment contract; provided, however, that nothing in the Plan
or herein shall confer upon the Optionee any right to continue
in the employ of the Company or its subsidiaries or interfere in
any way with the right of the Company or its subsidiaries to
terminate such employment at any time during such periods with-
out liability to the Company or its subsidiaries.
4. The Optionee represents and agrees that, in the
event of any exercise of the option, the shares of Common Stock
issuable upon exercise of the option will be acquired for
investment and not with a view to distribution thereof, and
agrees that such shares shall not be sold except in compliance
with the applicable provisions of the Securities Act of 1933, as
amended (the "Act"). The foregoing notwithstanding, at such
time as the shares of Common Stock issuable upon exercise of the
option have been registered pursuant to an effective registra
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<PAGE>
<PAGE>
tion statement under the Act, the foregoing restriction on the
distribution of such shares shall be inoperative. Nothing con-
tained herein or in the Plan, however, shall be construed as
requiring the Company to effect such registration.
5. If the Optionee sells or otherwise disposes of
any of the shares of Common Stock acquired pursuant to the exer-
cise of the option or received in exchange for such shares
within two years from the date hereof or one year after the date
of transfer of such shares to him or her pursuant to the exer-
cise of the option, the optionee shall notify the Company
thereof within 30 days after such disposition, providing the
Company with such information as the Company may reasonably
require or request to determine its obligation to withhold any
income or other taxes by reason of such disposition, and pay to
the Company on demand in cash an amount necessary to satisfy
such obligation.
6. The Company and the Optionee further agree that
they will both be subject to and bound by all of the terms and
conditions of the Plan, a copy of which is attached hereto and
made a part hereof. In the event the employment of the Optionee
terminates or in the event of the Optionee's death or dis-
ability, the Optionee's rights hereunder shall be governed by
and subject to the provisions of the Plan. In the event of a
conflict between the terms of this Contract and the Plan, the
terms of the Plan shall govern.
7. The option is not transferable otherwise than by
will or the laws of descent and distribution and may be exer-
cised, during the lifetime of the Optionee, only by the
Optionee.
8. The Plan was adopted prior to the promulgation of
final regulations by the Treasury Department under Section 422
(formerly Section 422A) of the Internal Revenue Code of 1986, as
amended. Accordingly, as it is intended that the options
granted under the Plan be incentive stock options within the
meaning of such section, the Optionee agrees that the Company
may amend the Plan and the options granted to the Optionee under
the Plan in any respect necessary or appropriate to bring the
Plan and such options into compliance with any such regulations.
9. This Contract shall be binding upon and inure to
the benefit of any successor or assignee of the Company and any
executor, administrator or legal representative entitled by law
to the Optionee's rights hereunder.
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<PAGE>
<PAGE>
10. This Contract shall be governed by and construed
in accordance with the laws of the State of New York.
11. The invalidity or illegality of any provision
herein or in the Plan shall not affect the validity of any other
such provision.
SWANK, INC.
By: \s\ A.C. CORSINI
ANDREW C. CORSINI, TREASURER
\s\ MARSHALL TULIN
Optionee MARSHALL TULIN
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<PAGE>
INCENTIVE STOCK OPTION CONTRACT
THIS INCENTIVE STOCK OPTION CONTRACT made as of the
23rd day June, 1987, between SWANK, INC., a Delaware corporation
(herein referred to as "Company"), and JOHN TULIN (herein
referred to as "Optionee"),
W I T N E S S E T H:
1. The Company, in accordance with the allotment
made by the Stock Option Committee, and subject to the terms and
conditions of the Amended and Restated 1981 Incentive Stock
Option Plan of the Company ("Plan"), grants as of the date
hereof, to the Optionee an option to purchase an aggregate of
6,600 shares of the Common Stock, $1 par value, of the Company
("Common Stock") at $ 15.00 per share, being the fair market
value of such stock on the date hereof.
2. The term of the option shall be ten years from
the date hereof, subject to earlier termination as provided in
the Plan. The option may be exercised in whole or in part and
from time to time, commencing September 23, 1987, but prior to
the end of the term of the option, by giving written notice to
the Company at its principal office, presently 6 Hazel Street,
Attleboro, Massachusetts, specifying the number of shares pur-
chased and accompanied by payment in full of the aggregate pur-
chase price therefor.
3. The Optionee agrees to make his services avail-
able to the Company and its subsidiaries, at the election of the
Company, for a period of one year from the later of (i) the date
hereof and (ii) the termination date of any existing employment
contract; provided, however, that nothing in the Plan or herein
shall confer upon the Optionee any right to continue in the
employ of the Company or its subsidiaries or interfere in any
way with the right of the Company or its subsidiaries to termi-
nate such employment at any time during such periods without
liability to the Company or its subsidiaries.
4. The Optionee represents and agrees that in the
event of any exercise of the option, the shares of Common Stock
issuable upon exercise of the option will be acquired for
investment and not with a view to distribution thereof, and
agrees that such shares shall not be sold except in compliance
with the applicable provisions of the Securities Act of 1933, as
amended (the "Act"). The foregoing notwithstanding, at such
time as the shares of Common Stock issuable upon exercise of the
option have been registered pursuant to an effective registra
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<PAGE>
<PAGE>
tion statement under the Act, the foregoing restriction on the
distribution of such shares shall be inoperative.
5. If the Optionee sells or otherwise disposes of
any of the shares of Common Stock acquired pursuant to the exer-
cise of the option or received in exchange for such shares,
within two years from the date hereof or one year after the date
of transfer of shares to him pursuant to the exercise of the
option, the Optionee shall notify the Company thereof provide
the Company with such information as the Company may reasonably
require or request to determine its obligation to withhold any
income or other taxes by reason of such disposition, and pay to
the Company on demand in cash an amount necessary to satisfy
such obligation.
6. The Company and the Optionee further agree that
they will both be subject to and bound by all of the terms and
conditions of the Plan, a copy of which is attached hereto and
made a part hereof. In the event the employment of the Optionee
terminates or in the event of his death or disability, his
rights hereunder shall be governed by and subject to the provi-
sions of the Plan. In the event of a conflict between the terms
of the option and the Plan, the terms of the Plan shall govern.
7. The option is not transferable otherwise than by
will or the laws of descent and distribution and may be exer-
cised, during the lifetime of the Optionee, only by him.
8. The Plan has been adopted prior to the promulga-
tion of final regulations by the Treasury Department under Sec-
tion 422A of the Internal Revenue Code of 1986, as amended (the
"Code"). Accordingly, as it is intended that the options
granted under the Plan be incentive stock options within the
meaning of such section, the Optionee agrees that the Company
may amend the Plan and the options granted to the Optionee under
the Plan in any respect necessary or appropriate to bring the
Plan and such options into compliance with any such rules and
regulations. Any options granted to Optionee under the Plan
shall be subject to the approval of the Plan by the stockholders
of the Company.
9. This contract shall be binding upon and inure to
the benefit of any successor or assignee of the Company and to
any executor, administrator or legal representative entitled by
law to the Optionee's rights hereunder.
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<PAGE>
<PAGE>
IN WITNESS WHEREOF, we have hereunto set our hands in
duplicate as of the day and year first above written.
SWANK, INC.
By: \s\ A.C. CORSINI
\s\ MARSHALL TULIN
Optionee
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<PAGE>
SWANK, INC.
THE NEW SWANK, INC. RETIREMENT PLAN TRUST AGREEMENT
THIS TRUST AGREEMENT made as of the 1st day of Janu-
ary, 1994, by and between SWANK, INC., a Delaware corporation
(hereinafter called the "Company"), and MARSHALL TULIN, JOHN
TULIN AND RAYMOND VISE (hereinafter collectively called the
"Trustee"; each, an "Individual Trustee").
W I T N E S S E T H:
WHEREAS, the Company adopted the Swank, Inc. Employee
Stock Ownership Plan amended and restated effective January 1,
1985 ("Prior ESOP No. 1"); the Swank, Inc. Employee Stock Owner-
ship Plan No. 2 amended and restated effective January 1, 1985
("Prior ESOP No. 2"; "Prior ESOP No. 1" and "Prior ESOP No. 2"
are hereinafter collectively referred to as the "Prior ESOPs")
and the Swank, Inc. Savings Plan, amended and restated effective
January 1, 1985 ("Prior 401(k) Plan"); and
WHEREAS, in connection with Prior ESOP No. 1, the Com-
pany entered into a trust agreement known as the Swank, Inc.
Employees' Stock Ownership Trust (the "Prior ESOP No. 1 Trust");
in connection with Prior ESOP No. 2, the Company entered into a
trust agreement known as the Swank, Inc. Employees' Stock
Ownership Trust No. 2 (the "Prior ESOP No. 2 Trust"); and in
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<PAGE>
connection with the Prior 401(k) Plan, the Company entered into
a trust agreement known as the Swank, Inc. Savings Trust (the
"Prior 401(k) Trust"); and
WHEREAS, the Company has deemed it advisable to merge
the Prior ESOPs with the Prior 401(k) Plan (the "Merger") and
restate the Prior ESOPs and the Prior 401(k) Plan as one plan to
be known as the New Swank, Inc. Retirement Plan (the "Plan");
and
WHEREAS, the right is expressly reserved to the Com-
pany under the Prior ESOP No. 1 Trust, the Prior ESOP No. 2
Trust and the Prior 401(k) Trust, to amend each trust agreement
at any time; and
WHEREAS, in light of the Merger, the Company desires
to amend and restate in their entirety the Prior ESOP No. 1
Trust, the Prior ESOP No. 2 Trust, and Prior 401(k) Trust as one
trust to be known as the New Swank, Inc. Retirement Plan Trust;
and
WHEREAS, the Company desires the Trustee to continue
to serve as Trustee under the terms of this trust agreement
(hereinafter called the "Trust Agreement"), and the Trustee is
willing to do so, under the terms herein provided.
NOW, THEREFORE, the Company does hereby amend and
restate each of the Prior ESOP No. 1 Trust, the Prior ESOP No. 2
Trust, and the Prior 401(k) Trust as one trust to be known as
the New Swank, Inc. Retirement Plan Trust to read and provide as
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<PAGE>
follows:
ARTICLE I
ESTABLISHMENT OF THE TRUST
A. The Company hereby establishes with the Trustee a
trust fund consisting of (i) amounts held in the Prior ESOP
No. 1 Accounts under the ESOP No. 1 Trust Agreement determined
as of December 31, 1993; (ii) amounts held in the Prior ESOP No.
2 Accounts under the Prior ESOP No. 2 Trust determined as of
December 31, 1993; (iii) amounts held in the Prior 401(k) Plan
Accounts determined as of December 31, 1993 under the Prior
401(k) Trust, (iv) such sums of money and property as shall from
time to time be paid to the Trustee under the Plan as 401(k)
Contributions, Matching Contributions, ESOP No. 1 Contributions,
ESOP No. 2 Contributions and Additional Contributions, and such
earnings, profits, increments, additions and appreciation
thereto and thereon as may accrue from time to time. All such
sums of money and property, all investments made therewith or
proceeds thereof, and all earnings, profits, increments, appre-
ciation and additions thereto and thereon, less the payments
which shall have been made by the Trustee, as authorized herein
to carry out the Plan, are referred to herein as the "Fund".
B. The Trustee shall not be responsible for the col-
lection of any contributions required by the Plan to be paid by
any Employer to the Trustee.
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<PAGE>
C. It shall be the duty of the Trustee hereunder:
(1) To hold, to invest, to reinvest, to manage,
and to administer the Fund in accordance with the provisions of
the Plan and this Trust Agreement, and
(2) From time to time, on the written direction
of the Committee, to make payments out of the Fund to such per-
sons, in such manner, in such amounts, and for such purposes as
may be specified in such written direction.
D. Except as may be otherwise provided in the Plan
or Article VIII hereof, under no circumstance shall any Employer
have any right, title, interest, claim or demand whatsoever in
or to the Fund held by the Trustee, other than the right to a
proper application thereof and accounting therefor by the Trus-
tee as provided herein.
ARTICLE II
INVESTMENT OF THE FUND
A. The Trustee shall invest and reinvest the princi-
pal and income of the Fund and keep the same invested without
distinction between principal and income. Except if directed by
the Committee to purchase Qualifying Employer Securities or to
establish separate investment funds pursuant to Sections 6.2,
6.3 or 6.4 of the Plan and except as provided in Article II B.
below, the selection and retention or disposition of any invest-
ment shall be determined by the Trustee.
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<PAGE>
B. The Trustee or the Company, through its Board of
Directors, or the Committee may appoint an Investment Manager
(as defined in the Plan) which Investment Manager, in its sole
discretion, shall have authority with respect to the investment
of that portion of the Fund over which the Trustee, the Company
or the Committee shall grant the Investment Manager investment
control. The Trustee shall be under no obligation to invest or
otherwise manage any asset of the Fund which is subject to the
management of an Investment Manager.
(1) If an Investment Manager is appointed, the
Company or the Trustee, as the case may be, may delegate to such
Investment Manager those powers of the Trustee as may be
specified in any agreement between the Trustee or the Company
and the Investment Manager.
(2) If an Investment Manager is appointed, the
Trustee shall not be liable for the acts or omissions of the
Investment Manager unless the Trustee participates knowingly in,
or knowingly undertakes to conceal, an act or omission of the
Investment Manager which is a breach of fiduciary
responsibility.
(3) If an Investment Manager is appointed, the
Investment Manager shall be directed to act in accordance with
the Plan's funding policy and solely in the interest of the Plan
Participants and their beneficiaries and for the exclusive pur-
pose of providing benefits to such individuals and to defray
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<PAGE>
reasonable expenses of administering the Plan, and to act with
the care, skill, prudence and diligence under the circumstances
then prevailing that a prudent man acting in a like capacity and
familiar with such matters would use in the conduct of an enter-
prise of a like character and with like aims.
C. Except to the extent set forth in Sections 6.2,
6.3, 6.4 and 6.5 of Plan and except as may be otherwise provided
in the Plan or in this Trust Agreement with respect to Qualify-
ing Employer Securities, the Trustee shall have the following
powers in addition to the powers customarily vested in trustees
by law and in no way in derogation thereof:
(1) With any cash at any time held by the Trus-
tee, to purchase or subscribe for any Authorized Investment (as
defined in Article II D below), and to retain such Authorized
Investment in trust.
(2) To sell for cash or on credit, convert,
redeem, exchange for another Authorized Investment, or otherwise
dispose of, any Authorized Investment at any time held by the
Trustee.
(3) To retain uninvested all or part of the Fund
and to deposit the same in any banking or savings institution.
(4) To exercise any options appurtenant to any
Authorized Investment in which the Fund is invested for conver-
sion thereof into another Authorized Investment, or to exercise
any rights to subscribe for additional Authorized Investments,
-6-
<PAGE>
and to make all necessary payments therefor.
(5) To join in, consent to, dissent from,
oppose, or deposit in connection with, the reorganization,
recapitalization, consolidation, sale, merger, foreclosure, or
readjustment of the finances of any corporations or properties
in which the Fund may be invested, or the sale, mortgage, pledge
or lease of any such property or the property of any such
corporation upon such terms and conditions as the Trustee may
deem wise, to do any act (including the exercise of options,
making of agreements or subscriptions, and payment of expenses,
assessments, or subscriptions) which may be deemed necessary or
advisable in connection therewith; and to accept any Authorized
Investment which may be issued in or as a result of any such
proceeding, and thereafter to hold the same.
(6) To vote, in person or by general or limited
proxy, at any election of any corporation in which the Fund is
invested, and similarly to exercise, personally or by a general
or limited power of attorney, any right appurtenant to any
Authorized Investment held in the Fund.
(7) To sell, either at public or private sale,
option to sell, mortgage, lease for a term of years less than or
continuing beyond the possible date of the termination of the
trust created hereunder, partition or exchange any real property
which may from time to time or at any time constitute a portion
of the Fund, for such prices and upon such terms as the Trustee
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<PAGE>
may deem best, and to make, execute and deliver to the purchas-
ers thereof good and sufficient deeds of conveyance therefor and
all assignments, transfers and other legal instruments, either
necessary or convenient for passing the title and ownership
thereof to the purchaser, free and discharged of all trusts and
without liability on the part of such purchasers to see to the
proper application of the purchase price.
(8) To repair, alter or improve any buildings
which may be on any real estate forming part of the Fund, or to
erect entirely new structures thereon.
(9) To renew or extend or participate in the
renewal or extension of any mortgage, upon such terms as the
Trustee may deem advisable, and to agree to a reduction in the
rate of interest on any mortgage or to any other modification or
change in the terms of any mortgage or of any guarantee pertain-
ing thereto, in any manner and to any extent that the Trustee
may deem advisable for the protection of the Fund or the preser-
vation of the value of the investment; to waive any default,
whether in the performance of any covenant or condition of any
mortgage or in the performance of any guarantee, or to enforce
any such default in such manner and to such extent as the Trus-
tee may deem advisable; to exercise and enforce any and all
rights to foreclosure, to bid in property on foreclosure, to
take a deed in lieu of foreclosure with or without paying a con-
sideration therefor, and in connection therewith to release the
-8-
<PAGE>
obligation on the bond secured by such mortgage; and to exercise
and enforce in any action, suit or proceeding at law or in
equity any rights or remedies in respect to any mortgage or
guarantee.
(10) To purchase Authorized Investments at a pre-
mium or discount.
(11) To employ suitable agents and counsel and to
pay their reasonable expenses and compensation.
(12) To borrow or raise moneys, for the purposes
of the Fund, in such amount and upon such terms and conditions
as the Trustee may deem advisable, and for any sum so borrowed
to issue the Trustee's promissory note as trustee and to secure
the repayment thereof by pledging or mortgaging all or any part
of the Fund. No person lending money to the Trustee shall be
bound to see to the application of the money lent or to inquire
into the validity, expediency or propriety of any such
borrowing.
(13) To cause any investment in the Fund to be
registered in, or transferred into, the Trustee's name as trus-
tee or the name of a nominee or nominees or to retain them
unregistered or in form permitting transfer by delivery, but the
books and records of the Trustee shall at all times show that
all such investments are part of the Fund, and the Trustee shall
be fully responsible for any misappropriation or defalcation in
respect of any investment held by a nominee or held in
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<PAGE>
unregistered form.
(14) To apply for, purchase, hold, transfer, pay
premiums on, surrender and exercise all incidents of ownership
of any insurance, investment or annuity contract which the Trus-
tee is directed to purchase from an insurance company by the
Committee.
(15) To do all acts which the Trustee may deem
necessary or proper and to exercise any and all powers of the
Trustee under this Trust Agreement upon such terms and condi-
tions which the Trustee may deem are for the best interests of
the Fund.
D. "Authorized Investment" as used in this
Article II shall mean bonds, debentures, notes, or other evi-
dences of indebtedness; stocks (regardless of class), or other
evidences of ownership, in any corporation, mutual investment
fund, investment company, association, real estate investment
trust or business trust; options to acquire securities of any
kind; general or limited partnership interests; precious jewels
or metals; works of art of any kind; insurance, investment or
annuity contracts issued by an insurance company; and real and
personal property of all kinds, including leaseholds on improved
and unimproved real estate. "Authorized Investment" shall not be
limited to that class of investments which are defined as legal
investments for trust funds under the laws of any state.
E. Notwithstanding any provision herein to the con-
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trary, the Trustee shall acquire or dispose of (i) Qualifying
Employer Securities held in ESOP No. 1 Accounts, and shall vote
or exercise voting or other rights appurtenant thereto solely in
accordance with the provisions of Section 6.3 of the Plan;
(ii) Qualifying Employer Securities held in ESOP No. 2 Accounts
and vote or exercise voting or other rights appurtenant thereto
solely in accordance with the provisions of Section 6.4 of the
Plan, and (iii) Qualifying Employer Securities held in a Partic-
ipant's Prior 401(k) Plan "A" Accounts and Additional Contribu-
tion Securities Account and vote or exercise voting or other
rights appurtenant thereto solely in accordance with the provi-
sions of Section 6.5 of the Plan.
F. The Trustee may enter into an agreement with any
bank or trust company or any other party to act as custodian
with respect to the assets of the Fund.
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ARTICLE III
ACCOUNTS TO BE KEPT AND
RENDERED BY THE TRUSTEE
A. The Trustee shall keep accurate and detailed
accounts of all investments, receipts and disbursements and
other transactions hereunder, accounting separately for 401(k)
Contributions, Matching Contributions, ESOP No. 1 Contributions,
ESOP No. 2 Contributions, and Additional Contributions, includ-
ing such specific records as shall be agreed upon in writing
between the Committee and the Trustee. All accounts, books and
records relating thereto shall be open to inspection and audit
by any person or persons designated by the Committee or the Com-
pany, at all reasonable times.
B. Within 90 days following the close of each Plan
Year and within 90 days after the effective date of the removal
or resignation of the Trustee, the Trustee shall file with the
Committee and the Company a written account, setting forth all
investments, receipts and disbursements, and other transactions
effected by the Trustee during such Plan Year or during the
period from the close of the last preceding Plan Year to the
date of such removal or resignation, including a description of
all securities and investments purchased and sold with the cost
or net proceeds of such purchases or sales, and showing all
cash, securities and other property held at the end of such Plan
Year or as of the date of removal or resignation, as the case
may be. The Trustee shall include in such report a valuation of
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the Fund in accordance with Article III D below. Neither the
Company nor the Committee nor any other person shall have the
right to demand or to be entitled to any further or different
accounting by the Trustee.
C. If so requested by the Committee, the Trustee
shall maintain a separate bookkeeping account or accounts for
each Participant and shall allocate to such Participant's
accounts the Employer contributions, the net income of the Fund
and any forfeitures as provided in the Plan.
D. The Trustee shall determine the market value of
the Fund as of the last business day of each Plan Year in accor-
dance with the terms of the Plan and at such other times as may
be necessary under the Plan.
ARTICLE IV
THE TRUSTEE
A. The Trustee accepts the trust hereby created and
agrees to perform the duties of the Trustee hereunder, subject,
however, to the following conditions:
(1) Any action taken pursuant to a direction,
request or approval given by the Committee under the powers con-
ferred upon it under the Plan or this Trust Agreement shall be
evidenced by delivery to the Trustee of a statement in writing
signed by the Committee or authorized member thereof.
(2) The Trustee shall receive as compensation
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for services such amounts as may be agreed upon at the time of
execution of this Trust Agreement, subject to change at any time
and from time to time by agreement between the Company and the
Trustee; provided, however, no Individual Trustee who is a full
time employee of any Employer shall receive compensation for
services hereunder other than reimbursement for expenses. The
Trustee's compensation and any other proper expense of the Fund,
including, but not limited to, counsel fees payable hereunder,
shall be paid out of the Fund unless paid by the Employers.
(3) As between the Trustee and persons dealing
with the Trustee on any matter regarding this Agreement or the
Plan, the claims of such persons shall be limited to the assets
of the Fund, and the Trustee shall not be responsible in an
individual capacity or from individual assets for any claims in
connection therewith. Except for liability resulting from gross
negligence or willful misconduct, the Company shall, to the full
extent permitted by law, indemnify and hold harmless each Indi-
vidual Trustee who is an employee or a member of the Board of
Directors of an Employer against all liability incurred in con-
nection with the control, management, administration and
operation of the Plan and with respect to the appointment and
performance of an Investment Manager.
(4) The Trustee need not engage in litigation
unless first indemnified against expense by the Company. The
Trustee may consult with any legal counsel, including counsel
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for the Company, with respect to the meaning or construction of
this Trust Agreement, its obligations or duties hereunder, or
any action or proceeding or any question of law. In any action
taken or omitted by the Trustee in good faith pursuant to the
written advice of the Company's counsel, the Company shall
indemnify and hold the Trustee harmless against litigation
expenses and attorneys' fees occasioned by such action.
B. Upon the appointment or change of the Committee,
and upon the appointment or change by the Committee of an autho-
rized member to deliver written statements to the Trustee, the
Company or the Committee, as the case may be, shall advise the
Trustee in writing thereof, and the Trustee shall be fully pro-
tected in assuming that there has been no change until so
advised by the Company or the Committee.
C. The Trustee or any Individual Trustee may resign
and be discharged of the trusts hereby created upon written
notice to the Company specifying the effective date thereof,
which effective date shall be at least 60 days after the notice
to the Company unless it be coincident with the appointment by
the Company of a successor Trustee or successor Individual Trus-
tee, as hereinafter provided. The Trustee or any Individual
Trustee may at any time be removed by action of the Board of
Directors of the Company by written notice delivered to the
Trustee or an Individual Trustee specifying an effective date
not earlier than the last day of the month following the month
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in which such notice is delivered. If the Trustee or an Indi-
vidual Trustee should resign or be removed, the Trustee or Indi-
vidual Trustee shall be reimbursed for all proper prior expenses
and shall receive compensation for prior services in accordance
with the terms hereof and the schedule of compensation then in
effect.
D. Upon the resignation or removal of the Trustee or
an Individual Trustee, a successor shall be appointed by action
of the Board of Directors of the Company; provided, however, a
successor need not be so appointed as long as there is at least
one individual Trustee hereunder.
E. Upon the effective date fixed in accordance with
Article IV C above, the retiring Trustee or Individual Trustee
shall deliver the Fund then held hereunder, together with all
records pertaining thereto, to a successor. The retiring Trus-
tee or Individual Trustee shall also, as of the date of transfer
of the Fund to a successor, file with the Company and the Com-
mittee an account and statement, which shall comply with the
requirements of Article III B above.
F. The Company may, by action of its Board of Direc-
tors, from time to time change the number of Individual Trustees
hereunder and appoint additional individual Trustees to fill the
vacancies caused by any such increase. An Individual Trustee
may be a member of the Board of Directors, an officer or an
employee of an Employer.
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<PAGE>
G. The Trustee may allocate such rights, responsi-
bilities and powers, other than the responsibility to manage and
control the Fund, between or among the Individual Trustees as
shall from time to time be deemed appropriate provided such
allocation is set forth and acknowledged in writing by all
Trustees.
H. Except to the extent specifically provided to the
contrary herein, any action of the Trustee shall be determined
by majority vote of the Individual Trustees. In lieu of a meet-
ing of the Individual Trustees, action by the Trustee may be
taken pursuant to written consent of a majority of the Individ-
ual Trustees. Any one of the Individual Trustees designated in
writing by the Individual Trustees may execute binding documents
on behalf of the Trustee.
ARTICLE V
CONCERNING INSURANCE COMPANIES
A. If, on any occasion as provided in the Plan, the
Trustee shall be directed to purchase an insurance, investment
or annuity contract from an insurance company, no such insurance
company shall be deemed a party to this Trust Agreement. It
shall have no obligation to determine that any person with
respect to whom the Trustee makes an application for a contract
is, in fact, eligible for benefits or participation under the
Plan, nor shall the insurance company have any obligation to
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determine any fact, the determination of which is necessary or
desirable for the proper issuance of such contracts. The insur-
ance company shall be fully protected in acting upon any advice,
representation, or other instrument executed by the Trustee.
The responsibilities of the insurance company shall be limited
to the terms of its policies or contracts. Notice of modifica-
tion, change or termination of this Trust Agreement shall not be
effective notice to the insurance company until actual receipt
thereof at its home office. The insurance company may expect
this Trust Agreement to continue in force as is, and the named
Trustee to continue as the Trustee under this Trust Agreement
until notified otherwise in writing at its home office.
B. A certification in writing to the insurance com-
pany, by the Trustee or the Committee as to the occurrence of
any event contemplated by this Trust Agreement or the Plan shall
constitute conclusive evidence of such occurrence, and the
insurance company shall be fully protected in accepting and
relying upon such certification and shall incur no liability or
responsibility for so doing.
C. The insurance company shall not be responsible to
see that any action taken by the Trustee with respect to any
contract or policy is authorized by the terms of this Trust
Agreement or the Plan. Any change made or action taken by the
insurance company under any contract or policy upon the written
direction of the Trustee shall fully discharge the insurance
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<PAGE>
company from all liability with respect thereto, and the insur-
ance company shall not be obligated to see to the distribution
or further application of any moneys paid by it to the Trustee
or in accordance with the written direction of the Trustee.
ARTICLE VI
EXEMPT LOANS -- ESOP PROVISIONS
A. If the Trustee engages in an Exempt Loan (as
defined in the Plan), the terms thereof and use of proceeds must
satisfy the conditions of this Article VI, as follows:
(1) The proceeds of an Exempt Loan must be used
to acquire Qualifying Employer Securities or to repay the Exempt
Loan or a prior Exempt Loan.
(2) The Qualifying Employer Securities acquired
with the proceeds of an Exempt Loan must not be subject to a
disposition restriction, other than a restriction imposed by
federal or state securities law or a right of first refusal in
accordance with Section 7.2 of the Plan.
(3) The interest rate on the Exempt Loan must be
reasonable in light of valuation and market factors then
existing.
(4) The Exempt Loan must be without recourse
against the Fund. The only Fund assets which may be given as
collateral are the Qualifying Employer Securities acquired with
the Exempt Loan proceeds or Qualifying Employer Securities which
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were used as collateral for a prior Exempt Loan repaid with the
current Exempt Loan. No person entitled to payment under the
Exempt Loan shall have any rights to the Fund other than in (a)
the collateral given, if any, (b) Employer contributions made to
meet the obligation, other than contributions made in Qualifying
Employer Securities, and (c) earnings attributable to the col-
lateral referred to in clause (a) and contributions referred to
in clause (b).
(5) Repayment of the Exempt Loan in any Plan
Year is limited to Employer contributions (less contributions
made in Qualifying Employer Securities) plus earnings for all
Plan Years to date less payments in prior Plan Years. The Trus-
tee shall keep separate records to account for contributions and
earnings until the Exempt Loan is repaid.
(6) If the Plan defaults, the value of Plan
assets transferred to satisfy the Exempt Loan may not exceed the
amount of default. If the Exempt Loan was made by a "disquali-
fied person" within the meaning of Section 4975 of the Code, the
Plan's transfer of assets must be limited to the extent of the
Plan's failure to meet the Exempt Loan payment schedule.
(7) The Exempt Loan must be for a specified term
and may not be payable on demand of any person, except in the
case of default.
(8) All Qualifying Employer Securities acquired
with the proceeds of an Exempt Loan initially shall be held
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<PAGE>
unallocated in a suspense account. If the Qualifying Employer
Securities are not pledged as collateral for the Exempt Loan,
they shall be removed from the suspense account and be allocated
to Participants as provided in Section 6.3(d) of the Plan. If
the Qualifying Employer Securities are pledged as collateral for
the Exempt Loan, the Exempt Loan must provide that for each Plan
Year during its term and the number of shares of each class of
Qualifying Employer Securities released from the suspense
account and the encumbrance of the collateral pledge must equal
the number of encumbered shares held in the suspense account
immediately before the release multiplied by a fraction, the
numerator of which is Exempt Loan principal and interest paid
for the Plan Year and the denominator of which is the sum of
such payments for the current and all future Plan Years. The
term of the Exempt Loan must be definitely ascertainable and,
for purposes hereof, extensions or renewal periods shall not be
considered. If the interest rate is variable, future interest
to be paid shall be determined based on the rate in effect on
the last day of the Plan Year. Notwithstanding the foregoing,
the release from the suspense account may be determined with
reference to principal payments only if (a) the Exempt Loan pro-
vides for annual payments of principal and interest at a cumula-
tive rate that is not less rapid at any time than level annual
payments of such amounts for ten years and (b) interest included
in any payment is disregarded only to the extent that it would
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<PAGE>
be determined to be interest under standard loan amortization
tables; however, the alternate permitted under this sentence is
not applicable from the time that by reason of a renewal, exten-
sion or refinancing, the sum of the expired duration of the
Exempt Loan, the renewal period, the extension period and the
duration of a new Exempt Loan exceeds ten years.
B. In addition to the foregoing, the Trustee shall
not engage in any Exempt Loan which does not satisfy the provi-
sions of the Plan applicable thereto.
ARTICLE VII
AMENDMENTS TO TRUST AGREEMENT -
DISCONTINUANCE OF PLAN
A. The provisions of this Trust Agreement may be
amended at any time and from time to time by action of the Board
of Directors of the Company provided that:
(1) No such amendment shall be effective unless
the Plan and the Trust Agreement, as so amended, shall be for
the exclusive benefit of employees of the Employer who are Par-
ticipants of the Plan, or their beneficiaries.
(2) No such amendment shall operate to deprive a
Participant of any rights or benefits irrevocably vested in him
under the Plan or Trust Agreement prior to such amendment.
(3) No such amendment which may affect the Trus-
tee shall be effective without the consent of the Trustee.
(4) Each such amendment shall be effective when
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adopted by the Board of Directors of the Company and filed with
the Trustee, except that where the consent of the Trustee is
required, such amendment shall not become effective until each
Individual Trustee has given consent by approving the copy of
the amendment filed with the Trustee.
B. In the event of termination of this Trust Agree-
ment, the Trustee shall continue to hold the Fund in trust to be
applied and distributed in accordance with the Plan.
ARTICLE VIII
RETURN OF CONTRIBUTIONS
A. Notwithstanding any provision of the Plan or the
Trust Agreement, all Employer contributions shall be conditioned
upon deductibility thereof under applicable provisions of the
Code. To the extent deduction of any such contribution deter-
mined by the Company in good faith to be deductible is disal-
lowed, the Trustee, at the direction of the Company, shall
return to the Employer that portion of its contribution, without
increase for investment earnings but with decrease for invest-
ment losses, if any, which has been disallowed within one year
after the disallowance of the deduction.
B. In the case of a Employer contribution made by a
good faith mistake of fact, the Trustee shall return to such
Employer the erroneous portion of its contribution, without
increase for investment earnings, but with decrease for
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<PAGE>
investment losses, if any, within one year after payment of the
contribution to the Fund.
C. No return of contribution shall be made under
this Article VIII which would cause the value of a Participant's
Account Balance attributable to Employer contributions to be
less than the value of a Participant's Account Balance had the
erroneous contribution not been made.
D. No return of contribution shall be made under
this Article VIII which adversely affects the Plan's qualified
status under regulations, rulings or other published positions
of the Internal Revenue Service.
E. In the event there is a determination that the
Plan does not qualify under Section 401 of the Code, all assets
of the Plan then held by the Trustee shall be returned to the
Employer by the Trustee.
ARTICLE IX
MISCELLANEOUS PROVISIONS
A. Any person dealing with the Trustee may rely upon
a copy of this Trust Agreement and any amendments thereto, cer-
tified to be a true and correct copy by the Trustee.
B. Except as provided in the Plan or Article VIII
hereof, under no circumstance, whether upon amendment or termi-
nation of this Trust Agreement, or otherwise, shall any part of
the Fund be used for or diverted to any purpose other than the
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<PAGE>
exclusive benefit of employees of the Employer who are Partici-
pants under the Plan, or their beneficiaries.
C. The Plan and each provision thereof is hereby
incorporated by reference and shall, for all purposes, be deemed
a part of this Trust Agreement.
D. The term "Plan" whenever used herein shall mean
the Plan as amended, revised or changed from time to time, and
the Company will cause a copy of any amendment or a copy of the
Plan as amended, revised or changed in any way from time to time
to be delivered to the Trustee for incorporation herein by
reference.
E. Any term used herein which is defined in the Plan
shall be considered to have the same meaning as in the Plan
unless the contrary is clearly indicated.
F. This Trust Agreement shall be construed, enforced
and regulated under the laws of the State of New York, except to
the extent such laws are superseded by the Employee Retirement
Income Security Act of 1974, as amended.
IN WITNESS WHEREOF, the Company has caused this Trust
agreement to be executed and needed its corporate seal to be
hereunto affixed and attested and each Individual Trustee has
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<PAGE>
hereunder set his hand and seal as of the day and year first
above written.
SWANK, INC.
______________________________
Attest
(Corporate Seal)
WITNESS: TRUSTEE
______________________________ (SEAL)
Marshall Tulin
______________________________ (SEAL)
John Tulin
______________________________ (SEAL)
Raymond Vise
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<PAGE>
THE NEW SWANK, INC. RETIREMENT PLAN
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<PAGE>
WHEREAS, Swank, Inc., a corporation organized and
existing under the laws of the State of Delaware (hereinafter
called the "Company"), adopted the Swank, Inc. Employee Stock
Ownership Plan amended and restated effective January 1, 1985
("Prior ESOP No. 1"); the Swank, Inc. Employee Stock Ownership
Plan No. 2 amended and restated effective January 1, 1985
("Prior ESOP No. 2; "Prior ESOP No. 1" and "Prior ESOP No. 2 are
hereinafter collectively referred to as the "Prior ESOPs") and
the Swank, Inc. Savings Plan, amended and restated effective
January 1, 1985 ("Prior 401(k) Plan"); and
WHEREAS, the right is expressly reserved to the Com-
pany under the Prior ESOPs and the Prior 401(k) Plan to amend
each Plan at any time; and
WHEREAS, the Company deems it advisable to merge the
Prior ESOPs with the Prior 401(k) Plan and restate the Prior
ESOPs and the Prior 401(k) Plan under the terms hereinafter set
forth;
NOW, THEREFORE, the Company does hereby merge the
Prior ESOPs with the Prior 401(k) Plan effective as of January
1, 1994, and does hereby amend and restate the Prior 401(k) Plan
and the Prior ESOPs, effective as of January 1, 1989, to read
and provide as follows:
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<PAGE>
ARTICLE I
DEFINITIONS
When used herein, the following words shall have the
following meanings, unless the context clearly indicates other-
wise.
1.1 Account. The word "Account" means one or more of
several accounts established by and maintained by the Plan
Administrator to record the interest of a Participant in the
Plan and shall include any or all of the following, where
appropriate:
(i) 401(k) Contributions Account means the account
established under Section 4.1 attributable to
401(k) Contributions and earnings and losses
thereon.
(ii) Matching Contributions Account means the
subaccount established under Section 4.1 pursuant
to Section 3.2(b)(i) attributable to Matching
Contributions and earnings and losses thereon.
(iii) ESOP No. 1 Contributions Account means the
subaccount established under Section 4.1 attrib-
utable to ESOP No. 1 Contributions on or after
January 1, 1994 pursuant to Section 3.2(b)(iii)
as adjusted to reflect forfeitures and earnings
and losses thereon.
(iv) ESOP No. 2 Contributions Account means the
subaccount established under Section 4.1 attrib-
utable to ESOP No. 2 Contributions on or after
January 1, 1994 pursuant to Section 3.2(b)(iv),
as adjusted to reflect forfeitures and earnings
and losses thereon.
(v) Additional Contributions Cash Account means the
subaccount established under Section 4.1 attrib-
utable to Additional Contributions pursuant to
Section 3.2(b)(ii) made in cash as adjusted for
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<PAGE>
earnings and losses thereon.
(vi) Additional Contributions Securities Account means
the subaccount established under Section 4.1
attributable to Additional Contributions pursuant
to Section 3.2(b)(ii) made in Qualifying Employer
Securities as adjusted for earnings and losses
thereon.
(vii) Prior ESOP No. 1 Account means the account estab-
lished under Section 4.1 attributable to a Par-
ticipant's account under Prior ESOP No. 1 deter-
mined as of December 31, 1993.
(viii) Prior ESOP No. 2 Accounts means the account
established under Section 4.1 attributable to a
Participant's account under Prior ESOP No. 2
determined as of December 31, 1993.
(ix) Prior 401(k) Plan "A" Account means the account
established under Section 4.1 attributable to a
Participant's "A" Account under the Prior 401(k)
Plan determined as of December 31, 1993.
(x) Prior 401(k) Plan "B" Account means the account
established under Section 4.1 attributable to a
Participant's "B" Account under the Prior 401(k)
Plan determined as of December 31, 1993.
(xi) Prior 401(k) Plan "C" Account means the account
established under Section 4.1 attributable to a
Participant's "C" Account under the Prior 401(k)
Plan determined as of December 31, 1993.
(xii) ESOP No. 1 Accounts means the Prior ESOP No. 1
Account and the ESOP No. 1 Contributions Account.
(xiii) ESOP No. 2 Accounts means the Prior ESOP No. 2
Account and the ESOP No. 2 Contributions Account.
(xiv) ESOP Diversification Account means the account
established under Section 6.3(a)(iv)(C) which
represents amounts held in a Participant's ESOP
No. 1 Accounts which such Participant has elected
to diversify pursuant to Section 6.3(a)(iv).
(xv) Employee Account means the account established
under Section 4.1 attributable to a Participant's
Employee Account under the Prior 401(k) Plan
(reflecting after-tax employee contributions made
under the Prior 401(k) Plan on or before December
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<PAGE>
31, 1988) determined as of December 31, 1993, as
adjusted for earnings and losses thereon.
The term "Account Balance" means the aggregate bal-
ances in a Participant's 401(k) Contributions Account, Discre-
tionary Contributions Account, Matching Contributions Account,
ESOP No. 1 Contributions Account, ESOP No. 2 Contributions
Account, Additional Contributions Cash Account, Additional Con-
tributions Securities Account, Prior 401(k) Plan "A" Account,
Prior 401(k) Plan "B" Account, Prior 401(k) Plan "C" Account,
Prior ESOP No. 1 Account, Prior ESOP No. 2 Account, Rollover
Account, ESOP Diversification Account, and Employee Account.
The term "Discretionary Contribution Account" means all of the
accounts listed in clauses (ii)-(vi) above collectively, a com-
bination of such accounts, or any of such accounts individually.
The term "ESOP Account Balances" or "ESOP Accounts" means the
aggregate balances in a Participant's ESOP No. 1 Contributions
Account, ESOP No. 2 Contributions Account, Prior No. ESOP 1
Account, and Prior ESOP No. 2 Account. The term "401(k) Account
Balances" or "401(k) Accounts" means the aggregate balances of a
Participant's 401(k) Contributions Account, Matching Contribu-
tions Account, Prior 401(k) Plan "B" Account, and Prior 401(k)
Plan "C" Account.
1.2 Additional Contributions. The term "Additional
Contributions" means the contributions, if any, made by an
Employer pursuant to Section 3.2(b)(ii).
1.3 Beneficiary. The word "Beneficiary" means such
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<PAGE>
person or persons or legal entity as may be designated by a Par-
ticipant to receive benefits hereunder after his death. In the
event of the absence, lapse or failure of such designation for
any reason whatsoever, the term Beneficiary shall mean: (a) the
Participant's surviving spouse, if any, (b) if the Participant
dies without a spouse surviving, his issue in equal shares per
stirpes; or (c) if the Participant dies without a spouse or
issue surviving, his executor or legal representative. Notwith-
standing any other provision of the Plan to the contrary, any
Beneficiary designation or change of Beneficiary designation by
a Participant which would result in the designation of a Benefi-
ciary other than the Participant's spouse shall not be effective
unless (i) the Participant's spouse consents to the designation
or change (or has previously so consented) or (ii) it is estab-
lished to the satisfaction of the Committee that such consent
cannot be obtained because the Participant's spouse cannot be
located or because of such other circumstances as may be pre-
scribed in regulations issued by the Department of Treasury.
Any consent by a Participant's spouse must be in writing, must
acknowledge the effect of the designation or change being made
by the Participant and must be notarized or witnessed by a mem-
ber of the Committee.
1.4 Board. The word "Board" means the Board of
Directors of the Company, or any committee appointed by the
Board and serving at the pleasure of the Board which is given
authority to exercise some or all of the powers of the Board
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<PAGE>
with respect to the Plan, the Trust and the Trust Fund.
1.5 Break In Service Year. The term "Break In Ser-
vice Year" means any Plan Year (except periods during which an
Employee is on a Leave of Absence) which ends after a Termina-
tion of Employment (including the Plan Year in which such termi-
nation occurred, if applicable) in which a Participant does not
complete more than five hundred (500) Hours of Service. Solely
for purposes of determining whether a Break in Service has
occurred, an individual shall be credited with the Hours of Ser-
vice which such individual would have completed but for a
"maternity or paternity absence," as determined by the Committee
in accordance with this Section 1.5 and the Code; provided, how-
ever, that the total Hours of Service credited by reason of any
such pregnancy or placement shall not exceed 501 hours and that
the individual timely provides the Committee with such informa-
tion as it shall require. Hours of Service credited for a
maternity or paternity absence shall be credited entirely (a) in
the Plan Year in which the absence began if such Hours of
Service are necessary to prevent a Break in Service in such
year, or (b) in the following Plan Year. For purposes of this
Section 1.5, "maternity or paternity absence" shall mean an
absence from work by reason of (i) the individual's pregnancy,
(ii) the birth of the individual's child, (iii) the placement of
a child with the individual in connection with adoption of the
child by such individual, or (iv) for purposes of caring for a
child for the period immediately following such birth or place-
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<PAGE>
ment.
1.6 Claims Supervisor. The term "Claims Supervisor"
means the person designated by the Committee as the Claims
Supervisor.
1.7 Code. The word "Code" means the Internal Revenue
Code of 1986, as amended, as it now exists or may from time to
time be further amended.
1.8 Committee. The word "Committee" means the 401(k)
Savings and Stock Ownership Plan Administrative Committee pro-
vided for in Article IX.
1.9 Company. The word "Company" means Swank, Inc., a
Delaware corporation, or any successor thereof.
1.10 Compensation. The word "Compensation" means the
total of all amounts paid by the Employer to or for the benefit
of a Participant for services rendered by the Participant during
the applicable Plan Year which is subject to withholding of
Federal income tax for the Plan Year (or which would have been
subject to such withholding if the Participant were a citizen of
the United States) prior to reduction for 401(k) Contributions
made with respect to such Plan Year pursuant to Section 3.1,
except: (i) deferred compensation (other than 401(k) Contribu-
tions made pursuant to Section 3.1) or contributions to any
other retirement, pension or profit-sharing plan or trust, stock
options and any gain or income attributable thereto; (ii) con-
tributions by an Employee to an arrangement maintained by an
Employer pursuant to Code Section 125; (iii) fifteen percent
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<PAGE>
(15%) of Compensation paid to a salesperson employed on a com-
mission basis where such Compensation is subject in full to
withholding of Federal income tax and includes expense allow-
ances and expense reimbursements, and (iv) any compensation
which would not be subject to such withholding but for a volun-
tary withholding agreement between the Employer and the
Employee. Notwithstanding the foregoing, "Compensation" with
respect to Plan Years commencing on or after January 1, 1989 and
ending December 31, 1993 shall be limited to $200,000 (as
adjusted under Code Section 415(d)), and for Plan Years commenc-
ing on or after January 1, 1994, "Compensation" shall be limited
to $150,000 (as adjusted under Code Section 415(d)).
1.11 Controlled Group. The term "Controlled Group"
means (i) any Controlled Group of corporations as defined in
Code Section 414(b) in which the Company is a member; (ii) any
trades or businesses, whether incorporated or not, under common
control as defined in Code Section 414(c), of which the Company
is a part, and (iii) any Affiliated Service Group, as defined in
Code Section 414(m), in which the Company is a member.
1.12 Disability or Disabled. The words "Disability
or Disabled" mean the total and permanent incapacity of a Par-
ticipant to perform the usual duties of his employment classifi-
cation and an inability to be gainfully employed by the Employer
by reason of any medically determinable physical or mental
impairment; such incapacity shall be deemed to exist only if
certified by a disinterested physician appointed by the Commit-
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tee.
1.13 Discretionary Contributions. The term Discre-
tionary Contributions means the contributions, if any, made by
an Employer pursuant to Section 3.2.
1.14 Eligibility Period of Service. The term "Eligi-
bility Period of Service" means the twelve (12) consecutive
month period commencing on an Employee's date of employment and
thereafter the first Plan Year commencing on or after such
Employee's date of employment and each Plan Year thereafter in
which such Employee is first credited with at least one-thousand
(1,000) Hours of Service.
Eligibility Period of Service shall include a twelve
(12) consecutive month period in which an Employee was credited
with at least one-thousand (1,000) Hours of Service with a
predecessor employer if the Board so determines.
1.15 Employee. The word "Employee" means a person
employed by the Employer, including a Leased Employee (unless
the provisions of Code Section 414(n)(5) are satisfied in
respect of such Leased Employee).
1.16 Employer. The word "Employer" means the Company
and any members of the Controlled Group which the Board may
authorize to adopt this Plan and which shall adopt this Plan
under such terms and conditions as the Board may specify.
1.17 Entry Date. The term "Entry Date" means July 1
and January 1 of each Plan Year.
1.18 ERISA. The term "ERISA" means the Employee
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Retirement Income Security Act of 1974, as it now exists or may
from time to time be amended.
1.19 ESOP No. 1 Contributions. The term "ESOP No. 1
Contributions" means the contributions, if any, made by an
Employer pursuant to Section 3.2(b)(iii).
1.20 ESOP No. 2 Contributions. The term "ESOP No. 2
Contributions" means the contributions, if any, made by an
Employer pursuant to Section 3.2(b)(iv).
1.21 Exempt Loan. The term "Exempt Loan" shall mean
a loan or other extension of credit between the portion of the
Plan representing ESOP No. 1 Accounts and a "party in interest"
(within the meaning of Section 3(14)(A) of ERISA) or a "disqual-
ified person" (within the meaning of Code Section 4975) which is
(i) used to acquire Qualifying Employer Securities and (ii)
exempt from the prohibited transaction provisions of ERISA Sec-
tion 406 and Code Section 4975.
1.22 Fiduciary. The word "Fiduciary" means the Com-
mittee, each member thereof, the Trustee and any other person,
group of persons or entity regarded as a fiduciary with respect
to the Plan or the Trust Fund within the meaning of Section
3(21) of ERISA. A person, group of persons or entity may serve
in more than one fiduciary capacity.
1.23 401(k) Contributions. The term "401(k) Contri-
butions" means contributions made by an Employer pursuant to
Section 3.1.
1.24 Former Participant. The term "Former Partici-
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pant" means a Participant whose employment with the Employer has
terminated because of retirement, Disability or other Termina-
tion of Employment and who has not received the full benefit to
which he is entitled hereunder.
1.25 Highly Compensated Employee. The term "Highly
Compensated Employee" means an individual determined to be a
highly compensated employee in accordance with Code Section
414(q), and the rules and regulations promulgated thereunder.
1.26 Hour of Service. The term "Hour of Service"
means each completed hour during the applicable computation
period (including overtime) for which an Employee is directly or
indirectly paid or entitled to payment for the performance of
services for a member of the Controlled Group (including service
as a Leased Employee of such member, but not including severance
or termination pay) and for periods of vacation, holiday, jury
duty, sick leave, temporary disability, temporary layoff or
Leave of Absence during which the Employee performed no services
but received compensation therefor and each hour for which back
pay irrespective of mitigation of damages is either awarded or
agreed to by the Employer, as determined on the basis of records
maintained by the members of the Controlled Group; provided,
however, that as an alternative in the case of employees not
compensated on an hourly basis or in the case of hourly paid
employees whose records are not available (except where such
hours are required to be counted and recorded by any other fed-
eral law, such as the Fair Labor Standards Act), such Employees
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shall be credited with forty-five (45) Hours of Service for each
completed week or part thereof with respect to which compensa-
tion is directly or indirectly paid or the Employee is entitled
to payment. Hours of Service shall be computed in accordance
with Department of Labor Regulations Section 2530.200 b-2(b),
and (c).
1.27 Investment Fund. The term "Investment Fund"
means any separate investment fund established by the Committee
under Article VI in which a Participant may direct the invest-
ment of any of the Participant's Accounts other than the ESOP
Accounts (other than the portion of the ESOP Accounts subject to
diversification under Section 6.3(a)(iv)) and the Additional
Contributions Securities Account.
1.28 Investment Manager. The term "Investment Man-
ager" means a Fiduciary (other than a Trustee or a Named Fidu-
ciary) (a) who has the power to manage, acquire or dispose of
any asset of the Trust Fund, (b) who is (i) registered as an
investment adviser under the Investment Advisers Act of 1940,
(ii) is a bank as defined in that Act, or (iii) is an insurance
company qualified to perform services described in (a) of this
Section under the laws of more than one state; and (c) has
acknowledged in writing that it is a Fiduciary with respect to
the Plan.
1.29 Key Employee. The term "Key Employee" means an
individual described in Code Section 416(i)(1).
1.30 Leased Employee. The term "Leased Employee"
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means a person described in Code Section 414(n)(2).
1.31 Leave of Absence. The term "Leave of Absence"
means:
(a) Authorized leave of absence not to
exceed two (2) years followed by a return to work on
or before the expiration of such authorized leave of
absence;
(b) Disability, causing an absence followed
by a resumption of active employment with a member of
the Controlled Group within sixty (60) days after the
termination of such Disability; and
(c) a leave of absence from active
employment of a member of the Controlled Group during
which an Employee is in the Armed Forces of the United
States under circumstances which entitle him to
reemployment and other related rights, provided the
Employee reenters the employ of a member of the
Controlled Group within the period during which his
re-employment rights are protected by law without any
intervening employment with an employer which is not a
member of the Controlled Group. In the event that a
person in such military service fails to return to
employment within such period, he shall be deemed to
have terminated his employment for all purposes
hereunder as of the commencement of his military
service.
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1.32 Matching Contributions. The term "Matching Con-
tributions" means the contributions, if any, made by an Employer
pursuant to Section 3.2(b)(i).
1.33 Named Fiduciary. The term "Named Fiduciary"
means (a) the Committee with respect to the control and manage-
ment of the operation and administration of the Plan and (b) the
Trustee with respect to the management and investment of the
assets held in the Trust Fund, except to the extent such powers
are exercised by an Investment Manager.
1.34 Participant. The word "Participant" means an
Employee who is eligible to participate in the Plan pursuant to
Article II hereof. For purposes of the Plan, the term "Former
Participant" means a Participant whose employment with the
Employer has ceased and who has not received the full benefit to
which he is entitled hereunder.
1.35 Permissive Aggregation Group. The term "Permis-
sive Aggregation Group" means the Required Aggregation Group
plus any other qualified plan or plans of a member of the Con-
trolled Group which, when considered as a group with the
Required Aggregation Group, would continue to satisfy the
requirements of Code Sections 401(a)(4) and 410.
1.36 Plan. The word "Plan" means the New Swank, Inc.
Retirement Plan adopted as of the Restatement Date and as set
forth in and by this document and all subsequent amendments
hereto and/or restatements hereof.
1.37 Plan Administrator. The term "Plan Administra-
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tor" means the Committee, or such other person or persons as may
be designated as the Plan Administrator by the Committee.
1.38 Plan Year; Limitation Year. Both the term "Plan
Year" and the term "Limitation Year" mean the twelve (12) month
period January 1 through December 31.
1.39 Prior ESOP No. 1. The term "Prior ESOP No. 1"
means the Swank, Inc. Employee Stock Ownership Plan as amended
and restated effective January 1, 1985.
1.40 Prior ESOP No. 2. The term "Prior ESOP No. 2"
means the Swank, Inc. Employee Stock Ownership Plan No. 2 as
amended and restated effective January 1, 1985.
1.41 Prior 401(k) Plan. The term "Prior 401(k) Plan"
means the Swank, Inc. Savings Plan as amended and restated
effective January 1, 1985.
1.42 Prior ESOP Participant. The term "Prior ESOP
Participant" means a person who was a Participant (as defined in
Prior ESOP No. 1 or Prior ESOP No. 2) in either Prior ESOP No. 1
or Prior ESOP No. 2 on December 31, 1988.
1.43 Prior 401(k) Plan Participant. The term "Prior
401(k) Plan Participant" means a person who was a Participant
(as defined in the Prior 401(k) Plan) in the Prior 401(k) Plan
on December 31, 1988.
1.44 Qualified Non-Elective Contributions. The term
"Qualified Non-Elective Contributions" means Employer contribu-
tions other than 401(k) Contributions and Matching Contribu-
tions, made in accordance with Section 3.2(b)(v) and which sat-
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isfy the requirements of Treasury Regulations Section
1.401(k)-1(g)(13)(iii).
1.45 Qualifying Employer Securities. The term "Qual-
ifying Employer Securities" means common stock issued by the
Company which is readily tradeable on an established securities
market, or, if none, common stock issued by the Company having a
combination of voting rights and dividend rights equal to or in
excess of that class of common stock of the Company having the
greatest voting power and that class of stock of the Company
having the greatest dividend rights.
1.46 Required Aggregation Group. The term "Required
Aggregation Group" means (1) each qualified plan of a member of
the Controlled Group in which at least one Key Employee partici-
pates, and (2) any other qualified plan of a member of the Con-
trolled Group which enables a plan described in (1) to meet the
requirements of Code Sections 401(a)(4) and 410.
1.47 Restatement Date. The term "Restatement Date"
means January 1, 1989.
1.48 Retirement Age/Date. The term "Retirement Age"
means age sixty-five (65). The term "Retirement Date" means the
Valuation Date coincident with or next succeeding the Partici-
pant's attainment of Retirement Age.
1.49 Super Top-Heavy Plan Year. The term "Super Top-
Heavy Plan Year" shall have the same definition as "Top-Heavy
Plan Year," except that the words "90 percent" shall be
substituted for the words "60 percent" in clause (a) of such
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definition.
1.50 Termination of Employment. The words "Termina-
tion of Employment" mean the cessation of full-time employment
(other than a Leave of Absence) with the Employer and all mem-
bers of the Controlled Group.
1.51 Top-Heavy Determination Date. The term "Top-
Heavy Determination Date" means with respect to whether a Plan
Year is a Top-Heavy Plan Year, the last day of the preceding
Plan Year, except that for the first Plan Year of the Plan, it
shall mean the last day of such first Plan Year.
1.52 Top-Heavy Plan Year. The term "Top-Heavy Plan
Year" means a Plan Year with respect to which any of the follow-
ing conditions exists as of the Top-Heavy Determination Date for
such Plan Year:
(a) If the Top-Heavy Ratio for this Plan exceeds
60 percent and this Plan is not part of any Required Aggregation
Group or Permissive Aggregation Group;
(b) If this Plan is part of a Required Aggrega-
tion Group but not part of a Permissive Aggregation Group and
the Top-Heavy Ratio for the Required Aggregation Group exceeds
60 percent, or
(c) If this Plan is part of a Required Aggrega-
tion Group and part of a Permissive Aggregation Group and the
Top-Heavy Ratio for the Permissive Aggregation Group exceeds 60
percent.
1.53 Top-Heavy Ratio. The term "Top-Heavy Ratio"
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means the ratio the aggregate of the accounts of Key Employees
on the Top-Heavy Valuation Date bears to the aggregate of the
accounts of all Employees on such Top-Heavy Valuation Date, com-
puted in accordance with the provisions of Code Section 416(g).
1.54 Top-Heavy Valuation Date. The term "Top-Heavy
Valuation Date" means with respect to a Top-Heavy Determination
Date the most recent valuation date occurring within the twelve
(12) month period ending on the Top-Heavy Determination Date.
1.55 Trust Agreement. The words "Trust Agreement"
shall mean that certain trust agreement dated as of January 1,
1994 between the Company and the trustees named thereunder pur-
suant to which contributions to the Plan shall be received,
held, invested and disbursed to or for the benefit of Partici-
pants, Former Participants and their Beneficiaries.
1.56 Trustee. The word "Trustee" means the original
Trustee appointed to administer the Trust Fund pursuant to the
Trust Agreement and any person, corporation, association or com-
bination thereof which shall accept the appointment as a succes-
sor Trustee or additional Trustee pursuant to the Trust Agree-
ment to execute the duties of Trustee as specifically set forth
herein and in the Trust Agreement.
1.57 Trust Fund. The words "Trust Fund" mean all
assets held by the Trustee for purposes of this Plan.
1.58 Valuation Date. The term "Valuation Date" shall
mean the last day of the Plan Year or any other date which the
Committee determines is necessary to value the assets of the
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Plan. If any portion of the Trust Fund or any Investment Fund
is invested in a manner which permits daily valuation of a Par-
ticipant's Account Balances without incremental cost or the Com-
mittee otherwise directs, then the date of liquidation of a Par-
ticipant's investments therein for distribution or reinvestment
shall also be a Valuation Date.
1.59 Vesting Years of Service. The term "Vesting
Years of Service" means all calendar years in which a Partici-
pant is credited with at least one-thousand (1,000) Hours of
Service with a member of the Controlled Group after it became a
member of the Controlled Group irrespective of whether such Par-
ticipant is then participating in the Plan; provided, however,
that if an Employee completes an Eligibility Period of Service
(which is not coincident with a Plan Year) commencing on his
date of employment, but does not receive credit for at least
one-thousand (1,000) Hours of Service during either of the Plan
Years included in his Eligibility Period of Service, such Eligi-
bility Period of Service shall be deemed to be a Vesting Year of
Service.
Vesting Years of Service shall include Plan Years in
which such Employee is credited with at least one-thousand
(1,000) Hours of Service with a predecessor employer in any case
where the Employer maintains a plan of a predecessor employer or
in any case in which the Employer maintains a plan which is not
the plan of the predecessor employer but with respect to which
it is determined by the Board that credit hereunder with such
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predecessor employer should be given.
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ARTICLE II
ELIGIBILITY AND PARTICIPATION
2.1 Requirements For Eligibility and Participation. (a)
Each person other than a Leased Employee, who, as of the
Restatement Date, was a Prior ESOP Participant or a Prior 401(k)
Plan Participant, and each Employee who, on or prior to the
Restatement Date, had attained age twenty-one (21) and completed
one (1) Eligibility Period of Service, or completed two (2) Eli-
gibility Periods of Service, whichever is earlier, shall be eli-
gible to be a Participant as of the Restatement Date.
(b) Each Employee other than as described in Section 2.1
(other than (i) a person who is covered by any other pension or
welfare plan to which the Employer contributes other than that
provided under the Social Security Act or other like Act of the
United States Government or any State, (ii) a person included in
a unit of employees covered by a collective bargaining agreement
with respect to which retirement benefits have been the subject
of good faith bargaining unless such collective bargaining
agreement provides to the contrary, in which case such Employee
shall be eligible to participate upon compliance with such
provisions for eligibility and participation as such agreement
and this Plan shall provide, or (iii) a Leased Employee), shall
be eligible to become a Participant on the Entry Date coincident
with or next following the earlier of (i) attainment by such
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Employee of age twenty-one (21) and completion by such Employee
of one (1) Eligibility Period of Service or (ii) completion by
such Employee of two (2) Eligibility Periods of Service.
Participation status shall continue so long as the Participant
remains an Employee and there has been no Termination of
Employment.
2.2 Designation of Beneficiary. Each Participant shall
designate in writing a Beneficiary to receive his benefits
hereunder in the event of death.
2.3 Effect of Leave of Absence. If any Employee is on an
authorized Leave of Absence after he has become a Participant in
the Plan, he shall continue to remain a Participant during the
period of such Leave of Absence and except as otherwise
determined by the Committee on a uniform and nondiscriminatory
basis applicable to all Participants, shall be credited solely
for purposes of determining Vesting Years of Service, with the
same number of Hours of Service as if such Employee was actively
employed during such period of Leave of Absence. However, dur-
ing the period of such Leave of Absence, no contributions shall
be allocated to the credit of his Account except for Compensa-
tion he receives directly from the Employer during each Plan
Year including all or part of such Leave of Absence. If such
Participant does not return to the employ of the Employer prior
to the expiration of such Leave of Absence, it shall be conclu-
sively presumed that his employment was terminated on or as of
the date of the commencement of such Leave of Absence. However,
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if the death of such Participant occurs prior to the expiration
of such Leave of Absence, the death benefit under Article V,
based on his participation, shall be payable; and if he shall
become totally and permanently Disabled, he shall be entitled to
the benefit as provided for a totally and permanently Disabled
Participant in Article V.
2.4 Joint Employment. Any Participant employed by more
than one Employer shall be considered an Employee of each such
Employer for the purpose of the Plan except that concurrent
employment with more than one (1) Employer shall not result in a
duplication of Eligibility Years of Service.
2.5 Service For Less Than 1,000 Hours. A Participant who
is not on Leave of Absence and who does not incur a Termination
of Employment but who fails to be credited with at least one-
thousand (1,000) Hours of Service during a Plan Year shall
continue to be a Participant but shall not receive a share of
Discretionary Contributions with respect to such Plan Year.
2.6 Termination of Employment.
(a) A Participant who (i) incurs a Termination of
Employment (ii) has at least one (1) Break In Service Year end-
ing after such termination and before re-employment, and (iii)
is thereafter re-employed as an Employee shall be required to
satisfy the requirements of Section 2.1 to become a Participant
after his re-employment but participation shall be retroactive
to the date of re-employment. An Employee who (i) incurs a Ter-
mination of Employment prior to becoming a Participant but after
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completing an Eligibility Period of Service and (ii) is re-
employed after he has at least one Break In Service Year must
complete another Eligibility Period of Service and satisfy the
requirements of Section 2.1 to become a Participant, but par-
ticipation shall be retroactive to his date of re-employment.
(b) A Participant who incurs a Termination of Employment
but who is re-employed as an Employee before he has at least one
(1) Break In Service Year shall become a Participant on his date
of re-employment. An Employee who (i) incurs a Termination of
Employment prior to becoming a Participant but after completing
an Eligibility Period of Service and (ii) is re-employed before
he has at least one Break In Service Year but after the Entry
Date coincident with or next following his completion of his
Eligibility Period of Service shall become a Participant on his
date of re-employment.
2.7 Assent to Terms of Plan. Each Participant shall be
deemed conclusively for all purposes to have assented to the
terms of the Plan and shall be bound thereby with the same force
and effect as if he had executed the Plan and the Trust Agree-
ment as a party thereto.
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ARTICLE III
CONTRIBUTIONS
3.1 401(k) Contributions. (a) Each Employee who
meets the eligibility requirements of Article II and thereby
becomes a Participant, may, subject to the provisions of
Section 3.7, elect to contribute to the Plan a percentage of the
Participant's Compensation for such Plan Year, by authorized
Compensation reductions. The percentage of 401(k) Contributions
shall be designated on such form as may be prescribed by the
Committee. The Committee may, in its discretion and on a uni-
form and non-discriminatory basis, permit Participants to desig-
nate dollar amounts rather than percentages. Any contributions
under this Section 3.1 shall be credited to the Participant's
401(k) Contributions Account.
(b) Election. The election pursuant to this Section
3.1 shall be made by a Participant in writing, in such form as
may be prescribed by the Committee, at least fifteen (15) days
prior to the Entry Date with respect to which the election is to
be effective. The Committee may, in its discretion, waive the
fifteen (15) day notice period set forth in the preceding sen-
tence. Such election shall be deemed to authorize the Employer
to make reductions to a Participant's Compensation for the pur-
pose of making 401(k) Contributions under this Section 3.1.
(c) Change or Suspension in Rate of 401(k) Contribu-
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tion. As of the end of each quarter of each Plan Year, a Par-
ticipant may elect to decrease or increase the rate of 401(k)
Contributions made on such Participant's behalf to a different
percentage to be effective as of the first day of the next quar-
ter Plan Year by filing a notice to that effect with the Commit-
tee. A Participant may suspend 401(k) Contributions at any time
by filing a notice to that effect with the Committee. A Par-
ticipant may again have 401(k) Contributions made on the Partic-
ipant's behalf as of the first day of a Plan Year subsequent to
such prior suspension by filing notice to that effect with the
Committee. All notices pursuant to this Subsection 3.1(c) shall
be filed at least fifteen (15) days prior to the date with
respect to which such change, suspension or resumption in the
rate of 401(k) Contributions is to be effective. All notices
filed pursuant to this Subsection 3.1(c) shall be effective as
soon as practicable. The Committee may, in its discretion and
on a uniform and non-discriminatory basis, waive the fifteen
(15) day notice period set forth herein and permit changes or
suspensions in the rate of 401(k) Contributions to be effective
as of such dates designated by the Committee.
3.2 Discretionary Contributions. (a) For each Plan
Year, in addition to 401(k) Contributions set forth in Section
3.1, the Employer may, in its sole discretion, contribute to the
Plan such amount as the Employer may claim as a deduction pursu-
ant to Code Section 404 on its federal income tax return for the
current taxable year.
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(b) Discretionary Contributions may take any, all or
any combination of the following forms:
(i) Matching Contributions (within the meaning of
Code Section 401(m)(4)) which, if made, may
be made in the form of cash or Qualifying
Employer Securities, in the discretion of the
Employer;
(ii) Additional Contributions which, if made, may
be made in the form of cash, Qualifying
Employer Securities or any combination
thereof, in the discretion of the Employer;
(iii) ESOP No. 1 Contributions, which, if made, may
be in the form of cash which shall be used to
purchase Qualifying Employer Securities, or
Qualifying Employer Securities which may be
purchased with the proceeds of an Exempt
Loan, in the discretion of the Employer.
(iv) ESOP No. 2 Contributions, which if made, may
be in the form of cash which shall be used to
purchase Qualifying Employer Securities, or
Qualifying Employer Securities, in the
discretion of the Employer.
(v) Qualified Non-Elective Contributions, which,
if made, may be made in the form of cash or
Qualifying Employer Securities or any
combination thereof, in the discretion of the
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Employer.
3.3 Time of Payment. Payment of a Discretionary Con-
tribution (or any portion thereof) of the Employer for any Plan
Year may be made from time to time at the direction of the
Employer's Board of Directors but in no event later than the
date prescribed by law for filing the Employer's federal income
tax return, including extensions thereof, for the taxable year
in which the Employer will deduct such contribution.
3.4 Contributions After Normal Retirement Age.
(a) A Participant who has attained Normal Retirement
Age may continue to have contributions made on such Partici-
pant's behalf in accordance with Sections 3.1 and 3.2.
(b) A Participant who has commenced to receive dis-
tributions of such Participant's Account Balance pursuant to
Article VIII may continue to have contributions made on such
Participant's behalf in accordance with Sections 3.1 and 3.2.
3.5 Return of Employer Contributions; Deductibility.
(a) Notwithstanding the provisions of Section 3.1 and
3.2, contributions shall be returned to an Employer under the
following circumstances:
(i) Mistake. If and to the extent that any contribu-
tion was made by a mistake in fact, the Committee may
direct the Trustee to return the contribution to the
Employer making such mistake at any time within one (1)
year after the payment of such contribution.
(ii) Failure to Qualify. If and to the extent that
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the Internal Revenue Service determines that the Plan or
Trust does not qualify under the provisions of Code Sec-
tions 401(a) or 501(a), respectively, either in its
entirety or with respect to any Employer, all contributions
made by any Employer with respect to whom the Plan or Trust
does not qualify by or after the date as of which the fail-
ure to qualify is deemed to have occurred shall be returned
to such Employer by the Trustee, upon direction given by
the Committee to the Trustee, within one (1) year after the
date of denial of qualification.
(iii) Nondeductibility. If and to the extent that the
Internal Revenue Service determines that a contribution is
not deductible under Code Section 404, the Committee shall
direct the Trustee to return the contribution to the
Employer making such contribution at any time within one
(1) year after the date of disallowance.
(iv) Adjustments. Any contribution returned pursuant
to this Section 3.5 shall be adjusted to reflect its pro-
portionate share of the Trust Fund's losses but not prof-
its.
(v) Limitation on Rights. Notwithstanding any provi-
sion of this Plan to the contrary, the right or claim of
any Participant, Former Participant or Beneficiary to any
asset of the Trust or to any benefit under the Plan shall
be subject to and limited by the provisions of this Section
3.5.
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All contributions shall be conditioned upon qualifica-
tion of the Plan and Trust under Code Sections 401(a) and 501(a)
and the deductibility of such contributions under Code Section
404.
3.6 Limitations on 401(k) Contributions.
(a) Notwithstanding the provisions of Section 3.1, in
no event shall the 401(k) Contributions for any Participant for
any calendar year exceed the limitation prescribed under Code
Section 402(g)(1) (as adjusted in accordance with Code Section
415(d)) for such calendar year.
(b) Notwithstanding the provisions of Section 3.1,
the Committee shall limit the amount of 401(k) Contributions
made on behalf of each Employee who is a Highly Compensated
Employee who is eligible to participate any time during the Plan
Year to the extent necessary to ensure that either of the fol-
lowing tests is satisfied:
(i) the "Actual Deferral Percentage" (as herein-
after defined) for the group of Employees
eligible to participate in the Plan who are
Highly Compensated Employees is not more
than the Actual Deferral Percentage of all
other Employees eligible to participate in
the Plan multiplied by 1.25; or
(ii) the excess of the Actual Deferral Percentage
for the group of Employees eligible to par-
ticipate in the Plan who are Highly Compen-
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<PAGE>
sated Employees over that of all other
Employees eligible to participate is not
more than two percentage points, and the
Actual Deferral Percentage for the group of
Employees eligible to participate in the
Plan who are Highly Compensated Employees is
not more than the Actual Deferral Percentage
of all other Employees eligible to partici-
pate in the Plan multiplied by 2.0.
(c) For purposes of this Section 3.6, the term
"Actual Deferral Percentage" shall mean, for any specified group
of Employees eligible to participate in the Plan, the average of
such Employees' Deferral Percentages (as defined below).
For purposes of this Section 3.6, the term "Deferral Percentage"
shall mean, for any Employee eligible to participate in the Plan
at any time during the Plan Year, the ratio of:
(i) the aggregate of the 401(k) Contributions
which, in accordance with the rules set
forth in Treasury Regulation Section
1.401(k)-1(b)(4), are taken into account
with respect to such Plan Year, to
(ii) such Employee's Code Section 414(s) compen-
sation for such Plan Year. For this pur-
pose, Code Section 414(s) compensation shall
mean compensation as described under Code
Section 415(c)(3) and the regulations there-
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under, and shall also include all amounts
currently not included in the Employee's
gross income by reason of Code Sections 125
and 402(a)(8). Notwithstanding the previous
sentence, Code Section 414(s) compensation
shall mean W-2 compensation as described in
Treasury Regulation Sections
1.414(s)-1(d)(2) and 1.415-2(d)(11), and
shall also include all amounts currently not
included in the Employee's gross income by
reason of Code Sections 125 and 402(g)(8).
In the case of an Employee who begins,
resumes, or ceases to be eligible to make
401(k) Contributions during a Plan Year, the
amount of Code Section 414(s) compensation
included in the Actual Deferral Percentage
test is the amount of Code Section 414(s)
compensation received by the Employee during
the entire Plan Year.
(d) The Deferral Percentage for any Participant who
is a Highly Compensated Employee for the Plan Year and who is
eligible to have 401(k) Contributions made on his behalf under
two or more arrangements described in Code Section 401(k) that
are maintained by the Employer shall be determined as if such
401(k) Contributions were made under a single arrangement.
If the Plan is permissibly aggregated or is required to be
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<PAGE>
aggregated with other plans having the same plan year, as pro-
vided under Treasury Regulation Section 1.401(k)-1(b)(3) for
purposes of determining whether or not such plans satisfy Code
Sections 401(k), 401(a)(4), or 410(b), then the provisions of
this Section 3.6 shall be applied by determining the Actual
Deferral Percentage of Employees who are eligible to participate
in the Plan as if all such plans were a single plan.
(e) In determining the Deferral Percentage for a Plan
Year for a Highly Compensated Employee, the 401(k) Contributions
and Code Section 414(s) compensation of such Participant shall,
to the extent required under Treasury Regulation Section
1.401(k)-1(g)(ii)(C), be aggregated with the 401(k)
Contributions and Code Section 414(s) compensation of any indi-
vidual who is a "Family Member" (as hereinafter defined). The
Deferral Percentage obtained by such aggregation shall be com-
bined with the Deferral Percentages of the Highly Compensated
Employees who are Participants in determining the Actual Defer-
ral Percentage for such group. Any Participant or Family Member
whose Deferral Percentage is so aggregated shall not have his
Deferral Percentage separately taken into account with respect
to any group of Employees in determining the Actual Deferral
Percentage for such group. For purposes of this Section 3.6 and
Section 3.9, a Family Member for this purpose means, with
respect to any Highly Compensated Employee described in Section
414(q)(6)(A) of the Code, an individual described in Section
414(q)(6)(B) of the Code.
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<PAGE>
(f) Solely for the purpose of this Section 3.6, the
term "401(k) Contributions" shall, to the extent elected by the
Committee in accordance with applicable law, include such other
contributions, including, without limitation, Qualified Non-
Elective Contributions, if any, which, in accordance with
Treasury Regulation Section 1.401(k)-1(b)(5), may be aggregated
with such 401(k) Contributions for purposes of demonstrating
compliance with the requirements of Code Section 401(k)(3).
(g) In the event the Committee determines prior to
any payroll period that the amount of 401(k) Contributions
elected to be made thereafter is likely to cause the limitation
prescribed in this Section 3.6 to be exceeded, the amount of
401(k) Contributions allowed to be made on behalf of Partici-
pants who are Highly Compensated Employees (and/or such other
Participants as the Committee may prescribe) shall be reduced to
a rate determined by the Committee (including a rate of 0% if
the Committee so determines), and any elections of future 401(k)
Contributions which exceed the rate determined by the Committee
shall be deemed to be after-tax contributions for the remainder
of the Plan Year, notwithstanding the limitations on contribu-
tion rate changes in Section 3.1. Except as is hereinafter pro-
vided, the Participants to whom such reduction is applicable and
the amount of such reduction shall be determined pursuant to
such uniform and nondiscriminatory rules as the Committee shall
prescribe.
(h) Notwithstanding the foregoing and except as
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<PAGE>
otherwise set forth herein, with respect to any Plan Year in
which 401(k) Contributions on behalf of Participants who are
Highly Compensated Employees exceed the applicable limit set
forth in this Section 3.6 ("Excess 401(k) Contributions"), the
Committee shall reduce the amount of the Excess 401(k) Contribu-
tions made on behalf of the Participants who are Highly Compen-
sated Employees (by reducing such contributions in order of
Deferral Percentages beginning with the highest), and shall
distribute such Excess 401(k) Contributions (along with earnings
attributable to such Excess 401(k) Contributions, determined in
accordance with paragraph (i)) to the affected Participants who
are Highly Compensated Employees as soon as practicable after
the end of such Plan Year, and in all events prior to the end of
the next following Plan Year. If, by application of the provi-
sions of the preceding paragraph, Excess 401(k) Contributions
are required to be distributed to a Participant and one or more
of his Family Members whose Deferral Percentages are required to
be aggregated in accordance with this Section 3.6, the amount of
the Excess 401(k) Contributions (and income allocable thereto)
to be distributed to each such individual shall be determined by
multiplying such Excess 401(k) Contributions by a fraction, the
numerator of which is each such individual's 401(k) Contribu-
tions for the Plan Year, and the denominator of which is the
aggregate 401(k) Contributions contributed on behalf of the Par-
ticipant and his Family Member(s) for the Plan Year.
(i) Income on a Participant's Excess 401(k) Contribu-
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<PAGE>
tions for the Plan Year in which such Excess 401(k) Contribu-
tions occur shall be determined in the manner provided for in
Article IV. Distributions after the end of the Plan Year shall
not include income for the period between the last day of the
Plan Year and the date of the distribution.
(j) Notwithstanding any distributions pursuant to the
foregoing provisions, Excess 401(k) Contributions shall be
treated as Annual Additions for purposes of Sections 4.5 and
4.10.
(k) Distributions pursuant to this Section 3.6 shall
be made proportionately from the Investment Funds with respect
to the Participant's Account or Accounts from which any such
distribution is made.
(l) The Committee may, to the extent permitted under
Treasury Regulation Section 1.401(k)-(f)(3), recharacterize as
after-tax contributions for such Plan Year all or a portion of
the 401(k) Contributions for Participants who are Highly Compen-
sated Employees to the extent necessary to comply with the
applicable limit set forth in this Section 3.6.
(m) The Committee may, in its sole discretion, elect
to use any combination of the methods described in this Section
3.6 to satisfy the limitations contained herein; provided, how-
ever, that such combination of methods shall be applied in a
uniform and non-discriminatory manner.
(n) The Committee also shall take all appropriate
steps to meet the aggregate limitation test contained in Section
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<PAGE>
3.10.
3.7 Distributions of Excess Deferrals.
(a) Notwithstanding any other provision of the Plan,
Excess 401(k) Amounts (as hereinafter defined) of a Participant
in respect of a calendar year, plus any income and minus any
loss allocable thereto for both the calendar year and the period
between the end of the calendar year and the date the distribu-
tion is made, as determined pursuant to Code Section 401(k) and
regulations promulgated thereunder, shall be distributed to such
Participant no later than the April 15 following the end of such
calendar year.
(b) For purposes of this Section 3.7, "Excess 401(k)
Amounts" shall mean the amount of a Participant's 401(k) Contri-
butions (and other "elective deferrals" within the meaning of
Code Section 402(g)(3)(A)) for a calendar year made to the Plan
or any other 401(k) Plan in excess of the limitation prescribed
under Code Section 402(g)(1) for such calendar year.
(c) The amount of excess 401(k) Contributions to be
recharacterized or distributed under Section 3.6 with respect to
a Participant for the Plan Year shall be reduced by any Excess
401(k) Amounts previously distributed to such Participant under
this Section 3.7 for the Participant's taxable year ending with
or within such Plan Year.
(d) The amount of Excess 401(k) Amounts that may be
distributed under this Section 3.7 with respect to a Participant
for a taxable year shall be reduced by any excess 401(k) Contri-
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<PAGE>
butions previously distributed to such Participant or
recharacterized with respect to such Participant for the Plan
Year beginning with or within such taxable year.
3.8 Limitation on Matching Contributions.
(a) Notwithstanding the foregoing provisions of
Article III, the Committee shall limit the amount of Matching
Contributions made by or on behalf of each Employee which is a
Highly Compensated Employee who is eligible to participate in
the Plan at any time during the Plan Year, to the extent neces-
sary to ensure that either of the following tests is satisfied:
(i) the "Actual Matching Contribution Percent-
age" (as hereinafter defined) for the group
of Employees eligible to participate in the
Plan who are Highly Compensated Employees is
not more than the Actual Matching Contribu-
tion Percentage of all other Employees eli-
gible to participate in the Plan multiplied
by 1.25; or
(ii) the excess of the Actual Matching Contribu-
tion Percentage for the group of Employees
eligible to participate in the Plan who are
Highly Compensated Employees over that of
all other Employees eligible to participate
in the Plan is not more than two percentage
points, and the Actual Matching Contribution
Percentage for the group of Employees eli-
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<PAGE>
gible to participate in the Plan who are
Highly Compensated Employees is not more
than the Actual Matching Contribution Per-
centage of all other Employees eligible to
participate in the Plan multiplied by 2.0.
(b) For purposes of this Section 3.8 the term "Actual
Matching Contribution Percentage" shall mean, for any specified
group of Employees eligible to participate in the Plan, the
average of such Employees' Matching Contribution Percentages (as
defined below).
(c) For purposes of this Section 3.8, the term
"Matching Contribution Percentage" shall mean, for an Employee
eligible to participate in the Plan at any time during the Plan
Year, the ratio of:
(i) the aggregate of the Matching Contributions
(which, in accordance with the rules set
forth in Treasury Regulation Section
1.401(m)-1(b)(4), are taken into account
with respect to such Plan Year), to
(ii) such Employee's Code Section 414(s)
compensation.
(d) The Matching Contribution Percentage for a Par-
ticipant who is a Highly Compensated Employee for the Plan Year
and who is to have matching employer contributions (within the
meaning of (Code Section 401(m)(4)(A)) made on his behalf under
two or more plans described in Code Section 401(a) that are
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<PAGE>
maintained by the Employer, shall be determined as if the total
of such matching employer contributions were made under a single
arrangement. If the Plan is permissibly aggregated or is
required to be aggregated with other plans having the same plan
year, as provided under Treasury Regulation Section
1.401(m)-1(b)(3) for purposes of determining whether or not such
plans satisfy Code Sections 401(m), 401(a)(4), or 410(b), then
the provisions of this Section 3.8 shall be applied by
determining the Actual Matching Contribution Percentage of
Employees who are eligible to participate in the Plan as if all
such plans were a single plan.
(e) In determining the Matching Contribution Percent-
age of a Highly Compensated Employee, Matching Contributions and
Code Section 414(s) compensation of such Participant shall, to
the extent required under Treasury Regulation Section
1.401(m)-1(f)(1)(ii)(C), reflect the Matching Contributions on
behalf of, and the Code Section 414(s) compensation of, any
individual who is a Family Member (as that term is defined in
Section 3.6). The Matching Contribution Percentage obtained by
such aggregation shall be combined with the Matching
Contribution Percentages of the applicable group of Highly
Compensated Employees in determining the Matching Contribution
Percentage for such group. Any Participant or Family Member
whose Matching Contribution Percentage is so aggregated shall
not have his Matching Contribution Percentage separately taken
into account with respect to any group of Employees in
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<PAGE>
determining the Matching Contribution Percentage for such group.
(f) Solely for the purpose of this Section 3.8, the
term "Matching Contribution" shall, to the extent elected by the
Committee in accordance with applicable law, include such other
contributions which, in accordance with Treasury Regulation Sec-
tion 1.401(m)-1(b)(5), may be aggregated with such Matching Con-
tributions for purposes of demonstrating compliance with the
requirements of Code Section 401(m)(2).
(g) In the event it is determined prior to any pay-
roll period that the amount of Matching Contributions to be made
thereafter is likely to cause the limitation prescribed in this
Section 3.8 to be exceeded, the amount of such contributions
allowed to be made by or on behalf of Participants who are
Highly Compensated Employees (and/or such other Participants as
the Committee may prescribe) shall be reduced to a rate deter-
mined by the Committee (including a rate of 0% if the Committee
so determines), notwithstanding the limitations on contribution
rate changes in Section 3.1. Except as is hereinafter provided,
the Participants to whom such reduction is applicable and the
amount of such reduction shall be determined pursuant to such
uniform and nondiscriminatory rules as the Committee shall
prescribe.
(h) Notwithstanding the foregoing paragraph, with
respect to any Plan Year in which Matching Contributions made on
behalf of Participants who are Highly Compensated Employees
exceed the applicable limit set forth in this Section 3.8, the
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<PAGE>
Committee shall reduce the amount of the excess Matching Contri-
butions made by or on behalf of the Participants who are Highly
Compensated Employees (by reducing such contributions in order
of Matching Contribution Percentages, beginning with the high-
est) in the order of the Actual Matching Contribution Percent-
ages of such Participants who are Highly Compensated Employees
and shall distribute such excess Matching Contributions (along
with earnings attributable to such excess contributions, deter-
mined pursuant to paragraph (i)) to the affected Participants
who are Highly Compensated Employees as soon as practicable
after the end of such Plan Year, and in all events prior to the
end of the next following Plan Year. In the event that Matching
Contributions (and earnings attributable to such contributions)
that are to be returned pursuant to this Section 3.8 are not
vested, they shall be forfeited. If, by application of the
provisions of the preceding paragraph, excess Matching Contribu-
tions are to be distributed to a Participant and one or more of
his Family Members whose Matching Contribution Percentage is
required to be aggregated in accordance with this Section 3.8,
the amount of the excess Matching Contributions (and income
allocable thereto) to be distributed to each such individual
shall be determined by multiplying such excess Matching Contri-
butions by a fraction, the numerator of which is each such indi-
vidual's Matching Contributions for the Plan Year, and the
denominator of which is the aggregate Matching Contributions
contributed by or on behalf of the Participant and the Family
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<PAGE>
Member(s) for the Plan Year.
(i) Income on excess Matching Contributions for the
Plan Year in which such excess occurs shall be determined in the
manner provided for in Article IV. Distributions made after the
end of the Plan Year shall not include income for the period
between the last day of the Plan year and the date of the
distribution.
(j) Notwithstanding any distributions pursuant to the
foregoing provisions, excess Matching Contributions shall be
treated as Annual Additions for purposes of Section 4.5 and
4.10.
(k) Distributions pursuant to this Section 3.8 shall
be made proportionately from the Investment Funds with respect
to the Participant's Account or Accounts from which distribution
is made.
(l) The Committee may, in its sole discretion, elect
to use any combination of the methods described in this Section
3.8 to satisfy the limitations contained herein; provided, how-
ever, that such combination of methods shall be applied in a
uniform and non-discriminatory manner.
(m) The Committee shall also take all appropriate
steps to meet the aggregate limitation test contained in Section
3.9.
3.9 Aggregate Limitation.
Any other provision of the Plan to the contrary not-
withstanding, the provisions of this Section 3.9 shall apply if
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<PAGE>
the conditions of both (a) and (b) below are satisfied.
(a) the sum of (i) the "Actual Deferral Percentage"
(as defined in Section 3.7) for the group of Highly Compensated
Employees who are eligible to participate in the Plan and (ii)
the "Actual Matching Contribution Percentage" (as defined in
Section 3.8 of the Plan) for such group of Highly Compensated
Employees exceeds the "Aggregate Limit" (as hereinafter
defined), and
(b) both (i) the Actual Deferral Percentage for the
group of Highly Compensated Employees who are eligible to par-
ticipate in the Plan exceeds 125% of the Actual Deferral
Percentage of all other Employees who are eligible to partici-
pate in the Plan and (ii) the Actual Matching Contribution Per-
centage of such group of Highly Compensated Employees exceeds
125% of the Actual Matching Contribution Percentage of all such
other Employees. The term "Aggregate Limit" means the greater
of the sum of (i) and (ii) below or the sum of (iii) and (iv)
below:
(i) 125% of the greater of (1) the Actual Defer-
ral Percentage of the group of Employees
eligible to participate in the Plan who are
not Highly Compensated Employees, or (2) the
Actual Matching Contribution Percentage of
the group of Employees eligible to partici-
pate in the Plan who are not Highly Compen-
sated Employees, and
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<PAGE>
(ii) Two (2) plus the lesser of clauses (i)(1) or
(i)(2) above (but in no event more than 200%
of the lesser of clauses (i)(1) or (i)(2)
above).
(iii) 125% of the lesser of (1) the Actual Defer-
ral Percentage of the group of Employees
eligible to participate in the Plan who are
not Highly Compensated Employees, or (2) the
Actual Matching Contribution Percentage of
the group of Employees eligible to partici-
pate in the Plan who are not Highly Compen-
sated Employees, and
(iv) Two plus the greater of clauses (iii)(1) or
(iii)(2) above (but in no event more than
200% of the greater of clauses (iii)(1) or
(iii)(2) above).
If the Actual Deferral Percentage and/or Actual Match-
ing Contribution Percentage for the group of Highly Compensated
Employees who are eligible to participate in the Plan, deter-
mined after any corrective distribution or recharacterization of
excess amounts in accordance with the provisions of Sections 3.6
and 3.8 have been made, exceeds an amount which would cause the
limits set forth in the foregoing provisions of this Section 3.9
to be exceeded, the amount of 401(k) Contributions and the
amount of Matching Contributions shall be reduced, in the same
manner and at the same time as such contributions are reduced in
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accordance with Sections 3.6 and 3.8, but only to the extent
necessary to bring the Plan into compliance with the applicable
limits set forth in this Section 3.9.
3.10 Withdrawal of 401(k) Contributions.
(a) Subject to paragraph (b) below, a Participant may
withdraw amounts from his 401(k) Contribution and Prior 401(k)
Plan "B" Accounts prior to his Termination of Employment on
account of hardship as set forth below.
(b) A distribution will be made on the account of
hardship if the distribution is (i) made on account of an imme-
diate and heavy financial need of the Participant (as described
in paragraph (c) below) and (ii) the distribution is necessary
to satisfy such financial need (as described in paragraph (d)
below). Such distribution shall be limited to the amount of a
Participant's 401(k) Contributions (and elective contributions
under the Prior 401(k) Plan) without regard to any earnings
thereon, reduced by the amount of any previous distributions on
account of hardship. A distribution based upon hardship shall
not exceed the amount required to meet the immediate financial
needs created by the hardship and not reasonably available from
other resources of the Participant. The determination of the
existence of hardship and the amount required to be distributed
to meet the need created by the hardship shall be determined by
the Committee or in accordance with regulations issued by the
Secretary of the Treasury. A distribution may be treated as
necessary to satisfy a financial need if the Committee relies on
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<PAGE>
written representations by the Participant, unless the Committee
has actual knowledge to the contrary, that the need cannot rea-
sonably be relieved: (i) through reimbursement or compensation
by insurance or otherwise; (ii) by liquidation of the
Participant's assets; (iii) by cessation of 401(k) Contribu-
tions, or (iv) by other distributions or nontaxable (at the time
of the loan) loans from plans maintained by the Company or
another employer, or by borrowing from commercial sources on
reasonable commercial terms in an amount sufficient to satisfy
the need; provided, however, that a need cannot be reasonably
relieved if the effect would be to increase the amount of the
need.
(c) For purposes of this Section 3.10, a distribution
will be deemed to be made on account of an immediate and heavy
financial need if the distribution is for:
(i) expenses for medical care described under Code
Section 213(d) previously incurred by the Participant, the
Participant's spouse or the Participant's dependents (as
defined in Code Section 152) or necessary for these persons
to obtain medical care described in Code Section 213(d).
(ii) costs directly related to the purchase of the
Participant's principal residence (excluding mortgage
payments);
(iii) payment of tuition and related educational fees
for the next 12 months of post-secondary education for the
Participant, the Participant's spouse, the Participant's
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children or dependents (as defined in Code Section 152);
(iv) payments necessary to prevent the eviction of the
Participant from his principal residence or the foreclosure
on the mortgage on the Participant's principal residence;
or
(v) such other events that the Commissioner of the
Internal Revenue Service may from time to time specify.
The amount of an immediate and heavy financial need
may include any amounts necessary to pay any federal, state, or
local income taxes or penalties reasonably anticipated to result
from the distribution.
(d) For purposes of this Section 3.10, a distribution
will be deemed necessary to satisfy a financial need if:
(i) the distribution is not in excess of the amount
of the need arising under paragraph (c) above;
(ii) the Participant has obtained all distributions,
other than hardship distributions, and all nontaxable (at
the time of the loan) loans that are currently available
under the Plan and all other plans maintained by the
Company;
(iii) the Participant may not make 401(k) Contributions
to the Plan or to any other plans maintained by the Company
for the twelve month period beginning on the date the Par-
ticipant receives a distribution pursuant to this Section
3.10; and
(iv) the Participant's maximum 401(k) Contributions to
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<PAGE>
the Plan (and all other plans maintained by the Company)
for the Participant's tax year following the tax year in
which the Participant receives a distribution under this
Section 3.10, is reduced to an amount equal to: (x) the
Code Section 402(g) limit for such following tax year,
minus (y) the amount of the Participant's 401(k) Contribu-
tions for the tax year in which the Participant receives a
distribution from the Plan pursuant to this Section 3.10.
3.11 Plan Transfers Notwithstanding any provision of
the Plan to the contrary, with respect to distributions from the
Plan on or after January 1, 1993, a distributee may elect, at
the time and in the manner prescribed by the Committee, to have
any portion of an eligible rollover distribution paid directly
to an eligible retirement plan specified by the distributee in a
direct rollover.
(i) Section 3.11 Definitions.
Eligible rollover distribution: An eligible
rollover distribution is any distribution of all or any
portion of the balance to the credit of the distributee,
except that an eligible rollover distribution does not
include: any distribution that is one of a series of sub-
stantially equal periodic payments (not less frequently
than annually) made for the life (or life expectancy) of
the distributee or the joint lives (or joint life expectan-
cies) of the distributee and the distributee's designated
beneficiary, or for a specified period of ten years or
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<PAGE>
more; any distribution to the extent such distribution is
required under Code Section 401(a)(9); and the portion of
any distribution that is not includible in gross income
(determined without regard to the exclusion for net unreal-
ized appreciation with respect to employer securities).
Eligible retirement plan: An eligible retirement
plan is an individual retirement account described in Code
Section 408(a); an individual retirement annuity described
in Code Section 408(b); an annuity plan described in Code
Section 403(a), or a qualified trust described in Code Sec-
tion 401(a), that accepts the distributee's eligible
rollover distribution. However, in the case of an eligible
rollover distribution to the surviving spouse, an eligible
retirement plan is an individual retirement account or
individual retirement annuity.
Distributee: A distributee includes an Partici-
pant or Former Participant. In addition, the Participant's
or Former Participant's surviving spouse and the Partici-
pant's or Former Participant's spouse or former spouse who
is the alternate payee under a qualified domestic relations
order, as defined in Code Section 414(p), are distributees
with regard to the interest of the spouse or former spouse.
Direct rollover: A direct rollover is a payment
by the Plan to the eligible retirement plan specified by
the distributee.
3.12 Withdrawal From Employee Account. Upon at least
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thirty (30) days prior notice on a form prescribed therefor and
filed with the Committee, a Participant may elect to withdraw
any amount up to the total amount of his contributions to his
Employee Account, but no more than the amount in his Employee
Account valued as of the Valuation Date next preceding such
election.
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ARTICLE IV
ALLOCATION OF CONTRIBUTIONS AND
ADMINISTRATION OF TRUST FUNDS
4.1 Establishment of Separate Accounts. The Committee
shall maintain (i) a 401(k) Contributions Account; (ii) a
Matching Contributions Account; (iii) an ESOP No. 1 Contribu-
tions Account; (iv) an ESOP No. 2 Contributions Account; (v) an
Additional Contributions Cash Account; (vi) an Additional Con-
tributions Securities Account; (vii) a Prior ESOP No. 1 Account;
(viii) a Prior ESOP No. 2 Account; (ix) a Prior 401(k) Plan "A"
Account; (x) a Prior 401(k) Plan "B" Account; (xi) a Prior
401(k) Plan "C" Account; (xii) an ESOP Diversification Account,
and (xiii) an Employee Account. Each Participant's Account Bal-
ance shall include the amounts credited thereto in accordance
with the provisions of Section 4.2. The Committee, in its dis-
cretion, may establish and maintain such additional accounts and
sub-accounts as it determines necessary for the administration
of the Plan.
4.2 Allocations To Accounts. As of each Valuation Date,
the Committee shall determine the net worth of the Trust Fund at
its current fair market value, less the amount of all expenses
which have been incurred but not paid. The Accounts of all
Participants shall then be adjusted in the following manner:
(a) First, there shall be credited (i) to a Participant's
401(k) Contribution Account, such Participant's 401(k)
Contributions, and (ii) to a Participant's Matching Contribu-
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<PAGE>
tions Account, Matching Contributions for a Plan Year, if any,
if such Participant is employed by an Employer (or on Leave of
Absence) on the last day of such Plan Year.
(b) Second, there shall then be credited or debited to the
Accounts (other than the ESOP Accounts and the Additional
Contributions Securities Accounts) of each Participant who was a
Participant on the preceding Valuation Date, a portion of the
net earnings and increase or decrease in the value of the Trust
Fund since the preceding Valuation Date. The Committee shall
credit or debit such earnings and increase or decrease in value
to each Account (other than the ESOP Accounts and the Additional
Contributions Securities Account) in the proportion that the
Account Balance as of the preceding Valuation Date bears to the
aggregate Account Balances as of the preceding Valuation Date.
Allocations of gains and losses in respect of ESOP No. 1
Accounts shall be made in accordance with Section 6.3(c). Allo-
cations of gains and losses in respect of ESOP No. 2 Accounts
shall be made in accordance with Section 6.4(c). Allocations of
gains and losses in respect of Additional Contribution Securi-
ties Accounts shall be made in accordance with Section 6.6.
(c) Third, ESOP No. 1 Contributions, ESOP No. 2 Con-
tributions and/or Additional Contributions made in the form of
Qualifying Employer Securities, and prior to January 1, 1994
Additional Contributions made in the form of cash, by an
Employer for any Plan Year shall be apportioned as of the last
day of the Plan Year among the Participants of such Employer
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employed (or on Leave of Absence) on the last day of the Plan
Year on the basis of the respective amounts of Compensation of
such Participants of each Employer so that the amount allocated
to each Participant's Account shall be that portion of the total
contribution of such Participant's Employer which such Partici-
pant's Compensation during his period of participation for that
Plan Year bears to the aggregate Compensation of all such Par-
ticipants of such Employer for that Plan Year.
(d) Fourth, the Committee shall determine the value of the
forfeiture determined under Article V of each Participant who
has incurred a forfeiture as of the Valuation Date of the
current Plan Year. Forfeitures shall be allocated as provided
in Section 4.2(c) as if they were a contribution made by the
Employer. If a forfeiture causes the limitation described in
Section 4.5 to be exceeded, any excess shall be credited to a
suspense account until the next Valuation Date at which time any
balance in the suspense account shall be treated as forfeiture
under Section 4.6 during the succeeding Plan Year. No amount
shall be considered as forfeited until a Participant has
incurred five (5) consecutive Break in Service Years. During
the period beginning on a Participant's separation from service
and ending on the Valuation Date on which his forfeiture occurs,
such forfeiture shall be maintained as a separate account. If a
Participant returns to the service of the Employer without hav-
ing incurred five (5) consecutive Break in Service Years, his
forfeiture account shall be reinstated in the same amount as on
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the date of his separation from service.
(e) Fifth, Additional Contributions by an Employer for any
Plan Year commencing on or after January 1, 1994 made in the
form of cash, if any, shall be apportioned as of the last day of
the Plan Year among the Participants of such Employer who are
employed (or who are on Leave of Absence) on the last day of the
Plan Year by allocating to each such Participant's Additional
Contributions Cash Account an amount equal to a percentage of
such Participant's Compensation from all Employers for such Plan
Year up to the dollar limit in effect for such Plan Year under
Code Section 414(q) (as adjusted under Code Section 415(d)). The
foregoing percentage shall be the same for all Participants.
(f) Sixth, Qualified Non-Elective Contributions by an
Employer for a Plan Year, if any, made in either cash or Quali-
fying Employer Securities, shall be apportioned as of the last
day of the Plan Year among the Participants of such Employer
employed on the last day of the Plan Year who are not Highly
Compensated Employees (as defined under Code Section 414(q))
("Non-Highly Compensated Employees") by allocating to each such
Non-Highly Compensated Employee's 401(k) Contribution Account
the same dollar amount or percentage of Compensation (or the
number of Qualifying Employer Securities having a value equal to
such dollar amount or percentage of Compensation, as the case
may be), as such amount or percentage of Compensation may be
determined by the Employer, in its sole discretion.
4.3 Top Heavy Limitations. Notwithstanding the foregoing,
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in any Top-Heavy Plan Year, the Discretionary Contributions
allocated to the Accounts of a non-Key Employee Participant who
is employed by the Employer on the last day of the Plan Year,
shall not be less than the lesser of (a) three percent (3%) of
such Participant's Compensation, or (b) unless the Employer has
designated this Plan to satisfy the requirements of Code
Sections 401(a)(4) or 410 for a defined benefit plan, the
largest percentage of Employer contributions and forfeitures
which is allocated on behalf of any Key Employee for such Plan
Year. This minimum allocation to the accounts of a non-Key
Employee Participant shall be made whether or not such Partici-
pant completed 1,000 Hours of Service during the Plan Year, and
shall be determined by treating all defined contribution plans
(in a Required Aggregation Group) as a single plan.
4.4 Valuation of Trust Fund. The Trust Fund shall be
valued on each Valuation Date. Notwithstanding anything to the
contrary set forth herein, the fair market value of any Qualify-
ing Employer Securities held in the Trust Fund on any Valuation
Date shall be (i) if the principal market for Qualifying
Employer Securities is a national securities exchange, the mean
between the closing bid and the closing asked price of such
Qualifying Employer Securities on such Valuation Date as
reported by such exchange or on a composite tape reflecting
transactions on such exchange, (ii) if the principal market for
such Qualifying Employer Securities is not a national securities
exchange and such Qualifying Employer Securities are quoted on
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the National Association of Securities Dealers Automated Quota-
tions System ("NASDAQ"), the mean between the closing bid and
the closing asked price of the Qualifying Employer Securities on
such Valuation Date on NASDAQ, or (iii) if the principal market
for the Qualifying Employer Securities is not a national securi-
ties exchange and the Qualifying Employer Securities are not
quoted on NASDAQ, the mean between the closing bid and the clos-
ing asked price for the Qualifying Employer Securities on such
Valuation Date as reported on the NASDAQ OTC Bulletin Board Ser-
vice or by National Quotation Bureau, Incorporated or a
comparable service; provided, however, that if no quotes are
available for such Valuation Date, then the quotations available
on the first business day immediately preceding the Valuation
Date shall be used for the foregoing purposes; and provided,
further, that if clauses (i), (ii) and (iii) of, and the immedi-
ately preceding proviso in, this Section 4.4 are all inappli-
cable or the Qualifying Employer Securities are not publicly
traded, then the fair market value of the Qualifying Employer
Securities shall be determined by the Committee based upon the
valuation of the Qualifying Employer Securities by an indepen-
dent appraiser selected by the Committee who meets requirements
similar to the requirements set forth under the Treasury Regula-
tions promulgated under Code Section 170(a)(1).
4.5 Maximum Annual Addition to a Participant's Account.
Notwithstanding any provision herein to the contrary, the sum of
the Annual Additions (as defined in Section 4.10) allocated to a
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Participant's Accounts under the Plan and any other defined
contribution plan maintained by a member of the Controlled Group
(hereinafter referred to as "Maximum Annual Addition") shall not
exceed the lesser of:
(a) $30,000 (or, if greater, one-fourth
(1/4) of the dollar limitation in effect under Code
Section 415(b)(1)(A)), or
(b) 25% of such Participant's Compensation
(including Compensation from any other member of the
Controlled Group which maintains a defined contribu-
tion plan in which such Participant is a participant).
4.6 Procedure For Reducing Annual Addition Where
Required. In the event that the sum of the Annual Additions
exceeds the Maximum Annual Addition, such Annual Additions shall
be reduced as follows to the extent necessary to bring the
Annual Additions within the maximum Annual Addition limitation:
(a) First, any 401(k) Contributions by the
Participant included in the Annual Additions shall be
returned to such Participant;
(b) Second, if there are no such
contributions by the Participant, or if such
contributions are not sufficient to reduce such Annual
Additions to the Maximum Annual Addition, the
Participant's allocable share of the Discretionary
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Contributions made by the Employer and forfeitures for
such Plan Year shall be reduced;
(c) Third, if, and to the extent that the
amount of any Participant's share of Discretionary
Contributions made by the Employer or forfeitures is
reduced pursuant to Section 4.6(b), the amount of such
reductions shall, subject to the limitations contained
in Section 4.5, be allocated among each such remaining
Participant for the Plan Year; and
(d) If the allocation provided in Section
4.6(c) could result in Annual Additions in excess of
the Maximum Annual Addition, the amount of such excess
will, instead of being so allocated, be credited to a
suspense account and allocated under Section 4.2 with
respect to the next succeeding Plan Year.
4.7 Reduction of Annual Addition Where Membership in
More Than One Defined Contribution Plan. If a Participant is a
participant in more than one (1) defined contribution plan
described in Code Section 414 maintained by a member of the Con-
trolled Group, the Maximum Annual Addition under all such plans
shall not exceed the limitation set forth in Section 4.5. If it
is necessary to apply the reductions described in Section 4.6,
the reduction under each plan shall be in proportion to the
amount in each category, as set forth in subparagraphs 5(a), (b)
and (c) of Section 4.6 provided, however, the reduction under
Section 4.6(b) shall not be made until all the Participant's
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contributions, if any, under all such plans have been returned
pursuant to Section 4.6(a).
4.8 Maximum Benefits Where a Participant Participates
in Both Defined Contribution and Defined Benefit Plans. If a
Participant is a participant in both a defined contribution plan
and a defined benefit plan described in Code Section 414 main-
tained by any Employer or any member of the Controlled Group,
the sum of his Defined Contribution Fraction (as defined in Sec-
tion 4.1) and his Defined Benefit Fraction (as defined in Sec-
tion 4.1) may not exceed one (1).
4.9 Procedure For Reduction Where a Participant Par-
ticipates in Both Defined Contribution and Defined Benefit
Plans. If the sum of a Participant's Defined Benefit Fraction
and Defined Contribution Fraction for any Plan Year exceeds one
(1), the Employer shall reduce the contribution under the
Defined Contribution Plan so that the sum of said fractions does
not exceed one (1).
4.10 Definitions.
(a) Annual Addition. For purposes of this
Article, the term "Annual Addition" means the sum for
any Plan Year of (i) Employer contributions made
directly or indirectly, (ii) the Participant's volun-
tary contributions, and (iii) forfeitures.
(b) Defined Contribution Fraction. For
purposes of this Article, the "Defined Contribution
Fraction" for any Plan Year is a fraction not greater
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than one (1), the numerator of which is the sum of the
Annual Additions to the Participant's accounts under
all defined contribution plans maintained by members
of the Controlled Group of which he is a participant
(determined as of the close of the Plan Year) and the
denominator of which is the lesser of (i) 125% of the
Maximum Annual Additions to such accounts as deter-
mined pursuant to Section 4.5(a) or (ii) 140% of the
Maximum Annual Additions to such accounts as deter-
mined pursuant to Section 4.5(b) which could have been
made for such year and each prior year of service with
the appropriate Employer.
If the Participant was a participant as of
the first day of the first Limitation Year beginning
after December 31, 1986, in one or more defined
contribution plans maintained by the Employer which
were in existence on May 6, 1986, the numerator of
this fraction will be adjusted if the sum of this
fraction and the Defined Benefit Fraction would
otherwise exceed 1.0 under the terms of the Plan.
Under the adjustment, an amount equal to the product
of (1) the excess of the sum of the fractions over
1.0, times (2) the denominator of this fraction, will
be permanently subtracted from the numerator of this
fraction. The adjustment is calculated using the
fractions as they would be computed as of the end of
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the last Limitation Year beginning before January 1,
1987, without regard to any amendments of such plans
made after May 5, 1986, but using the Code Section 415
limitation applicable to the first Limitation Year
beginning on or after January 1, 1987.
(c) Defined Benefit Fraction. For purposes
of this Article, the "Defined Benefit Fraction" for
any year is a fraction not greater than one (1), the
numerator of which is the projected annual benefit
under all such defined benefit plans maintained by
members of the Controlled Group (determined as of the
close of the Plan Year), and the denominator of which
is the lesser of (i) 125% of the greater of (A)
$90,000 (or such higher figure as adjusted for cost of
living increases in accordance with regulations pre-
scribed by the Secretary of the Treasury or his dele-
gate) or (B) the accrued benefit of the Participant as
of the last day of the last Plan Year beginning before
1983 under the terms of the Plan as of July 1, 1982 or
(ii) 140% of such Participant's average compensation
(including compensation from any other member of the
Controlled Group which maintains a defined benefit
plan in which such Participant is a participant) for
the 3 consecutive highest paid years (determined as of
the close of the Plan Year).
Notwithstanding the foregoing, if the
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Participant was a participant as of the first day of
the first Limitation Year beginning after December 31,
1986, in one or more defined benefit plans which were
in existence on May 6, 1986, the denominator of this
fraction will not be less than 125% of the sum of the
annual benefits under such plans which the Participant
had accrued as of the close of the last Limitation
Year beginning before January 1, 1987, without regard
to any amendments of such plans after May 5, 1986.
(d) Controlled Group. For purposes of
Sections 4.5 through 4.10, inclusive, the term
Controlled Group shall be determined by substituting
the phrase "more than 50%" for the phrase "at least
80%" as it appears in Code Section 1563(a)(1).
(e) Notwithstanding anything to the
contrary, the references in subsections (b) and (c) of
this Section 4.10 to "125%" shall be "100%" in (a) any
Super Top-Heavy Plan Year, or (b) any Top-Heavy Plan
Year unless Section 4.3 is applied by substituting
four percent (4%) for three percent (3%) therein.
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ARTICLE V
BENEFITS
5.1 Termination Benefit. (a) Notwithstanding anything to
the contrary in this Plan, a Participant's Prior 401(k) Plan "A"
Account, Prior 401(k) Plan "B" Account, Prior 401(k) Plan "C"
Account, 401(k) Contributions Account, Matching Contributions
Account, Additional Contributions Cash Accounts, Additional
Contributions Securities Account, and Employee Account shall at
all times be fully vested and non-forfeitable. In the event of
the Termination of Employment of a Participant for any reason,
the portion of a Participant's termination benefit attributable
to the foregoing Accounts shall be valued as of the Valuation
Date coincident with or next following (whichever shall first
occur) the date of such Participatnt's Termination of
Employment.
(b) In the event of the Termination of Employment of
a Participant for any reason other than retirement, death or
Disability, the portion of a Participant's termination benefit
attributable to such Participant's ESOP No. 1 Accounts and ESOP
No. 2 Accounts, shall be the balance in such ESOP Accounts val-
ued as of the applicable Valuation Date set forth in Section 8.2
multiplied by such Participant's Vested Percentage determined as
follows:
Vesting Years of Service Vested Percentage
Less than 3 0
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3 but less than 4 40
4 but less than 5 55
5 but less than 6 70
6 but less than 7 85
7 or more 100
plus 100% of the Participant's Prior 401(k) Plan "A", "B" and
"C" Accounts, 401(k) Contributions Account, Matching Contribu-
tions Account, Additional Contributions Cash Account, Additional
Contributions Securities Account, and Employee Account Valued in
accordance with paragraph (a) above.
(c) Payment of Benefits. The payment of benefits
shall be governed by the provisions of Article VIII.
(d) Death Before Account Distributed. If a Former
Participant dies after his Termination of Employment but before
the amount in his Accounts is completely distributed, no further
payments shall be made under this Section 5.1 and a death bene-
fit shall be paid pursuant to Section 5.4. The amount in such
Former Participant's Accounts shall not include amounts for-
feited pursuant to paragraph (e).
(e) Forfeitures of Non-Vested Benefits. Upon a Par-
ticipant's Termination of Employment other than as a result of
retirement, death or Disability, the non-vested portion of such
Participant's Accounts and determined under Section 5.1 (b)
shall be forfeited as of the last day of the Plan Year that is
the fifth (5th) consecutive Break In Service Year with respect
to such Participant.
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(f) Effect of Re-Employment.
(i) Notwithstanding paragraph (e), if a termi-
nated employee who had less than a 100% Vested Per-
centage of his Accounts at the date of his Termination
of Employment is both re-employed and repays the
entire amount (without interest) of any distributions
received upon his Termination of Employment, (1) in
the case of a distribution on account of Termination
of Employment, before the earlier of (i) five (5)
years after the first date on which such employee is
subsequently reemployed, or (ii) the close of the
first period of five (5) consecutive Break in Service
Years commencing after the distribution, or (2) in the
case of distributions other than on account of Termi-
nation of Employment, five (5) years after the date of
such distribution, such Employee shall have the non-
vested portion of each such Accounts restored to such
Accounts (unadjusted for any gains, losses or
expenses), respectively, on the last day of the Plan
Year in which both of said conditions are satisfied.
(ii) A terminated employee with a Vested Percent-
age under Section 5.1(b) at his Termination of Employ-
ment who thereafter returns to the employ of a member
of the Controlled Group after at least five (5) con-
secutive Break In Service Years shall have his Vesting
Years of Service determined at his Termination of
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Employment restored when he becomes a Participant as
required by Section 2.6.
(iii) Notwithstanding anything herein to the con-
trary, a Participant who has no Vested Percentage
under Section 5.1(b) at the date of his Termination of
Employment, and who thereafter returns to the employ
of a member of the Controlled Group after at least
five (5) consecutive Break In Service Years shall not
receive vesting credit for the Years of Service he had
at the date of his Termination of Employment, and such
Years of Service shall be disregarded for all purposes
hereunder, if the number of his consecutive Break In
Service Years prior to his return to employment equals
or exceeds the number of his Vesting Years of Service
at the date of his Termination of Employment.
5.2 Retirement Benefits.
(a) If a Participant continues in the employ of
the Employer on or after his Retirement Date, he shall continue
to be treated in all respects as a Participant until his actual
retirement. No retirement benefits shall be payable to a Par-
ticipant until his actual retirement, and all retirements shall
be deemed effective as of the Valuation Date coincident with or
next succeeding the date of actual retirement.
(b) A Participant who attains the sixty-fifth
(65th) anniversary of his date of birth prior to his Termination
of Employment shall be entitled to a non-forfeitable retirement
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benefit. The retirement benefit of such Participant shall be
the aggregate amount in his Accounts valued as of the Valuation
Date coincident with or next following (whichever shall first
occur) his Retirement Date or his actual retirement date (which-
ever is later), plus any Employer contributions made with
respect to the Plan Year then ending allocated to his Accounts,
whether or not such contribution was actually received by the
Trustee on or before such Valuation Date.
(c) The payment of benefits shall be governed by
the provisions of Article VIII.
(d) If a Former Participant dies after his
actual retirement but before the amount in his account is com-
pletely distributed, no further payments shall be made under
this Section 5.2 a death benefit shall be paid pursuant to Sec-
tion 5.4.
5.3 Disability Benefit.
(a) In the event of the total and permanent Dis-
ability of a Participant and his Termination of Employment on
account of said Disability, such Participant shall become 100%
vested in his Accounts and shall be entitled to the aggregate
amount in his Accounts valued as of the Valuation Date coinci-
dent with or next following (whichever shall first occur) the
date of the Participant's Termination of Employment on account
of such Disability.
(b) The payment of benefits shall be governed by
the provisions of Article VIII.
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(c) If a Disabled Participant dies after Termi-
nation of Employment and certification of his Disability but
before the amount in his Accounts is completely distributed, no
further payments shall be made under this Section 5.3 and a
death benefit shall be paid pursuant to Section 5.4.
5.4 Death Benefits.
(a) An the event of the death of a Participant
or Former Participant, such Participant shall be deemed to be
100% vested in his Accounts and the death benefit of such
deceased Participant shall be the aggregate amount in his
Accounts valued as of the Valuation Date coincident with or next
following (whichever shall first occur) the date of death of
such Participant.
(b) Except as otherwise set forth in Section
1.13, at any time, and from time to time, each Participant shall
have the unrestricted right to designate the Beneficiary to
receive the death benefit payable hereunder and to revoke any
such designation. Each such designation shall be evidenced by a
written instrument filed with the Committee and signed by the
Participant, in a form prescribed by the Committee.
(c) Subject to paragraph (d) below, the payment
of benefits shall be governed by the provisions of Article VIII
(where applicable).
(d) If distribution of a Participant's benefit
has commenced prior to such Participant's death, and such Par-
ticipant dies before his entire benefit is distributed to him,
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distribution of the remaining portion of the Participant's bene-
fit to the Participant's Beneficiary shall be made at least as
rapidly as under the method of distribution in effect as of the
date of the Participant's death. If a Participant dies before
distribution of his benefit has commenced, distributions to any
Beneficiary shall be made within 5 years after such Partici-
pant's death; provided, however, that any distribution to a
Beneficiary may be made over the life of the Beneficiary (or
over a period not extending beyond the life expectancy of the
Beneficiary), and in such event, such distribution shall not
commence later than one (1) year after such Participant's death.
In the event such Beneficiary is the Participant's Surviving
Spouse, the foregoing shall not apply, but such distribution
shall not commence later than the date on which such Participant
would have attained age 70-1/2. If such Surviving Spouse dies
after such Participant's death but before distributions to such
Surviving Spouse commence, this paragraph (d) shall be applied
as if the Surviving Spouse were the Participant.
(e) If payments to a Beneficiary are being paid
in installments and such Beneficiary dies before the amount in
his Accounts is completely distributed, the balance thereof
shall be paid to his estate in a lump sum within sixty (60) days
after the close of Plan Year in which such Beneficiary dies.
(f) The Committee may require the execution and
delivery of such documents, papers and receipts as they may deem
reasonably necessary in order to be assured that the payment of
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any death benefit is made to the person or persons entitled
thereto.
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ARTICLE VI
INVESTMENT OF TRUST FUND
6.1 Investment Control. Except as may be otherwise set forth
herein, the management and control of the assets of the Plan
shall be vested in the Trustee designated from time to time by
the Company through its Board of Directors pursuant to the Trust
Agreement; provided, however, the Company, through its Board of
Directors, or the Trustee, may appoint one or more Investment
Managers to manage, acquire or dispose of any assets of the Plan
and the Committee may instruct the Trustee to establish separate
Investment Funds for selection by Participants pursuant to
Section 6.3(a)(iv) or with respect to a Participant's 401(k)
Accounts, or Employee Accounts. The Committee may at any time
add to or delete any such Investment Funds. A Participant may
change the designation of Investment Funds as of the last day of
each quarter of a Plan Year.
6.2 Investment of 401(k) Accounts and Certain Other
Accounts. (a) If the Committee instructs the Trustee to estab-
lish Investment Funds under the Plan, each Participant shall
have the right, under uniform rules established by the Committee
and in accordance with Section 404(c) of ERISA and regulations
thereunder, to designate such Investment Funds in which the
Trustee is to invest a Participant's 401(k) Accounts, and
Employee Account. Any designation or change in designation of
an Investment Fund shall be made in writing on forms provided by
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and submitted to the Committee and shall be effective in accor-
dance with uniform rules established by the Committee.
(b) No Participant Election. If a Participant does not
make a written election of an Investment Fund, the Committee
shall direct the Trustee to invest all amounts allocated to such
Participant in the Investment Funds which, in the opinion of the
Committee, best protects principal.
6.3 Investment of ESOP No. 1 Accounts. (a) The special
rules set forth below shall apply with respect to the
acquisition and disposition of Qualifying Employer Securities
held in a Participant's ESOP No. 1 Accounts and with respect to
voting Qualifying Employer Securities held in ESOP No. 1
Accounts.
(i) Acquisition. ESOP No. 1 Accounts shall be
invested primarily in Qualifying Employer Securities and may be
subject to an Exempt Loan. The Trustee shall purchase Qualify-
ing Employer Securities with respect to ESOP No. 1 Accounts only
at the direction of the Committee.
(ii) Disposition. The Trustee shall dispose of Quali-
fying Employer Securities allocated to a Participant's ESOP No.
1 Accounts only with the consent of the Participant. The Trustee
shall not dispose of a greater percentage of unallocated
Qualifying Employer Securities than it could dispose of allo-
cated Qualifying Employer Securities in any transaction or
series of transactions.
(iii) Voting. The Trustee shall vote Qualifying
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Employer Securities purchased with the proceeds of an Exempt
Loan which are allocated to a Participant's ESOP No. 1 Accounts
as the Participant (or in the event of a Participant's death,
the Participant's Beneficiary) directs. A Participant shall
direct the Trustee as to the voting of Qualifying Employer Secu-
rities not acquired with the proceeds of an Exempt Loan and that
are allocated to his ESOP No. 1 Accounts with respect to corpo-
rate matters which involve the voting of such Qualifying
Employer Securities with respect to the approval or disapproval
of any corporate merger or consolidation, recapitalization,
reclassification, liquidation, dissolution, or sale of substan-
tially all assets of a trade or business of the Company. The
Trustee shall vote Qualifying Employer Securities not allocated
to the account of any Participant, and all allocated Shares for
which no Participant directions are received, with respect to
corporate matters which involve the voting of such Qualifying
Employer Securities with respect to the approval or disapproval
of any corporate merger or consolidation, recapitalization,
reclassification, liquidation, dissolution, or sale of substan-
tially all assets of a trade or business of the Company in the
same proportion as such directions are received for allocated
Qualifying Employer Securities with respect to such corporate
matters.
(iv) Diversification Option. A Participant who satis-
fies the requirement of Section 6.3(a)(iv)(A) below may elect
within ninety days after the close of each Plan Year in the
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election period described in Section 6.3(a)(iv)(B) below to
direct the Trustee to distribute to him up to 25% of the shares
of Qualifying Employer Securities allocated to the Participant's
ESOP No. 1 Accounts as of the last day of such Plan Year (less
the number of such shares transferred pursuant to a prior writ-
ten election under this Section 6.3(a)(iv)). Further, in the
case of the election year in which the Participant can make his
last election in accordance with Section 6.3(a)(iv)(B) below,
"50%" shall be substituted for "25%" in the preceding sentence.
(A) Eligibility. A Participant shall be eli-
gible to make the election described above if, as of the close
of a Plan Year, he has both attained age 55 and reached the
tenth anniversary of the date he commenced participation in the
Plan.
(B) Election Period. The election described
above may be made in the six consecutive Plan Years
beginning with the first Plan Year after the Plan Year in which
the Participant satisfies the requirements of the preceding
subsection.
(C) Investment Options. The Committee shall
direct the Trustee to establish at least three Investment Funds
and prescribe uniform rules of general application under which a
Participant may direct that a portion of his ESOP No. 1 Accounts
(but in no event in excess of the percentage set forth under
Section 6.3(a)(iv)) be transferred thereto. Any amounts so
transferred shall be maintained in the ESOP Diversification
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Account.
(b) Valuations. Qualifying Employer Securities held in a
Participant's ESOP No. 1 Accounts shall be valued in accordance
with Section 4.4.
(c) Allocation of Gain or Loss. Except as otherwise
provided herein, any increase or decrease in the market value of
Qualifying Employer Securities held in a Participant's ESOP
No. 1 Contribution Account since the preceding Valuation Date,
as computed by the Trustee pursuant to Section 4.4 above, and
all income collected, and expenses paid and realized profits and
losses shall be added to or deducted from a Participant's ESOP
No. 1 Accounts in the ratio that each Participant's ESOP No. 1
Accounts, at the prior Valuation Date (less amounts distributed
or transferred to the ESOP Diversification Account under Section
6.3(a)(iv)) bears to the total of all such ESOP No. 1 Accounts
(less amounts distributed or transferred to the ESOP Diversifi-
cation Account under Section 6.3(a)(iv)).
(d) Suspense Account. All Qualifying Employer Securities
acquired with respect to ESOP No. 1 Accounts with the proceeds
of an Exempt Loan initially shall be held in an unallocated
suspense account until released. If such Qualifying Employer
Securities are not pledged as collateral for an Exempt Loan, the
number of shares of Qualifying Employer Securities released must
equal the number of shares held in the suspense account
immediately before the release multiplied by a fraction, the
numerator of which is Exempt Loan principal and interest paid
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for the Plan Year and the denominator of which is the sum of
such payments for the current and all future Plan Years,
determined without regard to any extensions or renewal periods.
If the interest rate under the Exempt Loan is variable, future
interest to be paid shall be determined based on the rate in
effect on the last day of the Plan Year for which the release is
being calculated. If such Qualifying Employer Securities are
pledged as collateral for an Exempt Loan, the number of shares
released shall be determined under the Trust Agreement. Quali-
fying Employer Securities so released from the suspense account
shall be allocated to ESOP No. 1 Accounts in accordance with
Section 4.2. Dividends on Qualifying Employer Securities held
in the suspense account which are not used to pay principal or
interest on the Exempt Loan shall be allocated to a Partici-
pant's ESOP No. 1 Accounts as income for the Plan Year unless
expensed pursuant to paragraph (e) below.
(e) Dividend Distributions
(i) Allocated Securities. Dividends received in
respect of Qualifying Employer Securities allocated to a Partic-
ipant's ESOP No. 1 Accounts either shall be (1) allocated to
such ESOP No. 1 Accounts in accordance with paragraph (e) above
or (2) distributed to the Participants to whom they are allo-
cated provided the distribution is made not later than 90 days
after the close of the Plan Year in which the dividends are
paid, as the Committee shall direct. If the Committee deter-
mines that dividends are to be distributed directly to Partici-
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pants, the Committee may request the Company to pay them
directly to the Participant, according to a schedule of distri-
bution provided by the Committee.
(ii) Suspense Account. Dividends received in the
Trust Fund in respect of Qualifying Employer Securities held in
a suspense account may be applied (A) to make payments of prin-
cipal or interest on the Exempt Loan with which they were
acquired or (B) to pay expenses of the Plan, as the Committee
shall direct.
6.4 Investment of ESOP No. 2 Accounts. (a) The special
rules set forth below shall apply with respect to the
acquisition and disposition of Qualifying Employer Securities
held in a Participant's ESOP No. 2 Accounts and with respect to
voting Qualifying Employer Securities held in ESOP No. 2
Accounts.
(i) Acquisition. ESOP No. 2 Accounts shall be
invested primarily in Qualifying Employer Securities and shall
not be subject to an Exempt Loan. The Trustee shall purchase
Qualifying Employer Securities with respect to ESOP No. 2
Accounts only at the direction of the Committee.
(ii) Disposition. The Trustee shall dispose of Quali-
fying Employer Securities allocated to an ESOP No. 2 Account
only at the direction of the Committee.
(iii) Voting. A Participant shall direct the Trustee
as to the voting of Qualifying Employer Securities allocated to
his ESOP No. 2 Accounts with respect to corporate matters which
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involve the voting of such Qualifying Employer Securities with
respect to the approval or disapproval of any corporate merger
or consolidation, recapitalization, reclassification, liquida-
tion, dissolution, or sale of substantially all assets of a
trade or business of the Company. The Trustee shall vote Quali-
fying Employer Securities for which no Participant directions
are received with respect to corporate matters which involve the
voting of such Qualifying Employer Securities with respect to
the approval or disapproval of any corporate merger or consoli-
dation, recapitalization, reclassification, liquidation, disso-
lution, or sale of substantially all assets of a trade or busi-
ness of the Company in the same proportion as such directions
are received for allocated Qualifying Employer Securities with
respect to such corporate matters.
(iv) Diversification Option. Qualifying Employer
Securities held with respect to a Participant's ESOP No. 2
Accounts shall not be subject to the provisions of Section
6.3(iv).
(b) Valuations. The Qualifying Employer Securities held
in a Participant's ESOP No. 2 Accounts shall be valued in
accordance with Section 4.4.
(c) Allocation of Gain or Loss. Any increase or decrease
in the market value of Qualifying Employer Securities held in a
Participant's ESOP No. 2 Accounts since the preceding Valuation
Date, as computed by the Trustee pursuant to Section 4.4, and
all income collected, and expenses paid and realized profits and
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losses shall be added to or deducted from a Participant's ESOP
No. 2 Accounts in the ratio that each Participant's ESOP No. 2
Accounts, at the prior Valuation Date (less amounts distributed)
bears to the total of all such ESOP No. 2 Accounts (less
amounts distributed).
(d) Dividends. Dividends received in respect of
Qualifying Employer Securities allocated to a Participant is
ESOP No. 2 Accounts shall be applied to purchase additional
shares of Qualifying Employer Securities for such accounts.
(e) Suspense Account. All Qualifying Employer Securities
held with respect to ESOP No. 2 Accounts shall be held in an
unallocated suspense account until allocated.
6.5 Voting of Qualifying Employer Securities Held in a
Participant's Prior 401(k) Plan "A" Account and Additional
Contribution Securities Accounts. A Participant shall direct
the Trustee as to the voting of Qualifying Employer Securities
allocated to the Participant's Prior 401(k) Plan "A" Account and
Additional Contribution Securities Account.
6.6 Allocation of Gains and Losses in Additional Con-
tribution Securities Accounts. Any increase or decrease in the
market value of Qualifying Employer Securities held in a Partic-
ipant's Additional Contribution Securities Account since the
preceding Valuation Date, as computed by the Trustee pursuant to
Section 4.4, and all income collected, and expenses paid and
realized profits and losses shall be added to or deducted from a
Participant's in the ratio that each Participant's Additional
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Contribution Securities Account, at the prior Valuation Date
(less amounts distributed) bears to the total of all such
Additional Contribution Securities Accounts (less amounts
distributed).
6.7 Registration of Qualifying Employer Securities.
Qualifying Employer Securities held in a Participant's Accounts
as of December 31, 1993 may, but shall not be obligated to be
re-issued, and all Qualifying Employer Securities acquired under
the Plan thereafter shall be held, in the name of "Trustee for
the Swank, Inc. 401(k) Savings and Stock Ownership Plan" or in
the name of the nominee of the Trustee or the Investment Man-
ager, as the case may be. Legal title to any such Qualifying
Employer Securities and except as otherwise set forth herein,
all voting and other rights shall remain in the Trustee until
said Qualifying Employer Securities shall be registered in the
name of the Participant upon distribution to the Participant.
6.8 Adjustments. Appropriate adjustment shall be made by
the Committee with respect to Qualifying Employer Securities
held in a Participant's Accounts for any change in the
outstanding shares of common stock the Company by reason of
recapitalization, merger, consolidation, split up, stock divi-
dend, stock split, combination or exchange of shares or the
like.
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ARTICLE VII
ESOP RULES
7.1 Put Option. A Participant who receives a distribution
of Qualifying Employer Securities from his ESOP Accounts and/or
Prior 401(k) Plan "A" Accounts hereunder when such securities
are not publicly traded or are subject to a trading limitation
under applicable federal or state securities laws or regulations
thereunder or under an agreement restricting trading other than
the right of first refusal under Section 7.2 below hereof shall
have an option, exercisable under the terms of this Section 7.1,
to cause the Company to purchase the Qualifying Employer
Securities so distributed; provided, however, the Committee
shall have the right, but not the obligation, to cause the Plan
to assume the rights and obligations of the Company under the
Participant's option. The option shall be exercisable by the
Participant, the Participant's donees or any person, including
the Participant's estate or distributee therefrom, to whom
Qualifying Employer Securities pass by reason of the Par-
ticipant's death, by giving written notice to the Company that
the option is being exercised. The option shall be exercisable
for a term of 15 months, measured from the date of distribution
from the Plan, exclusive of any period during which the distrib-
utee is unable to exercise the option because the party bound
thereby is precluded from honoring it by applicable law. The
option price shall be the fair market value of the Qualifying
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Employer Securities as of the most recent Valuation Date. How-
ever, if the Plan assumes the rights and obligations of the Com-
pany under the Participant's option, and such Participant is a
disqualified person (as defined in Code Section 4975(e)(2)), the
option price shall be the fair market value of the Qualifying
Employer Securities as of the date of the transaction. The Com-
pany, or the Trustee if the Committee directs the Trustee to
exercise the Company's rights and obligations under the option,
may make payment in substantially equal annual installments over
not more than five years, with payment commencing 30 days after
the option is exercised. If payment is made in installments,
the obligor shall provide adequate security and pay a reasonable
rate of interest.
7.2 Right of First Refusal. (a) If at any time a
Participant, or a Participant's donee or beneficiary desires to
sell, encumber, or otherwise dispose of Qualifying Employer
Securities distributed from a Participant's ESOP No. 1 Accounts
under the Plan and such Securities are not then publicly traded,
the Participant shall first offer the same to the Trustee and to
the Company by giving the Trustee and the Company written notice
disclosing: (i) the name(s) of the proposed transferee; (ii)
the certificate number and amount of Qualifying Employer
Securities proposed to be transferred; (iii) the proposed price;
and (iv) all other terms of the proposed transfer. Within 14
days after receipt of such notice the Trustee, as directed by
the Committee, and then the Company shall have the option to
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purchase all or part of such Qualifying Employer Securities. If
the Trustee or the Company decides to exercise the option, the
purchase price shall be the proposed price under the intended
transferee's good faith offer to purchase the Qualifying
Employer Securities or the fair market value of the Qualifying
Employer Securities on the most recent Valuation Date, whichever
is greater. The Company, or the Trustee if the Committee
directs the Trustee to exercise the Company's rights and obliga-
tions under the option, may make payment in substantially equal
annual installments over not more than five years, with payment
commencing 30 days after the option is exercised if the purchase
price is the most recent Valuation Date price or if such price
is at least as favorable to the Participant as the proposed
terms. If payment is made in installments, the obligor shall
provide adequate security and pay a reasonable rate of interest.
(b) In the event neither the Trustee nor the Company
exercises the option to purchase set forth in paragraph (a)
above, the Participant, donee or beneficiary shall have the
right to sell, encumber or otherwise dispose of Qualifying
Employer Securities on the terms of the transfer set forth in
the written notice to the Trustee, provided such transfer is
effected within 14 days after the expiration of the option
period and provided the same, in the opinion of counsel to the
Company, will not require the registration of the Qualifying
Employer Securities under any applicable federal or state secu-
rities laws or otherwise be in contravention of such laws or in
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any way be inconsistent with any investment representation given
by the Participant. If the transfer is not effected within such
period, the Trustees and the Company must again be given an
option to purchase, as provided herein.
(c) All share certificates subject to the right of first
refusal shall be endorsed on their face with a legend necessary
to reflect the same.
7.3 Nonterminable Protections and Rights. If the Plan
acquires Qualifying Employer Securities with respect to ESOP No.
1 Accounts with the proceeds of an Exempt Loan and such Loan is
repaid, or the portion of the Plan constituting ESOP No. 1
Accounts ceases to be an employee stock ownership plan (within
the meaning of Code Section 4975(e)(7)), then the put option
described in Section 7.1 and the limitations on the right of
first refusal under Section 7.2 must continue to apply to such
Qualifying Employer Securities.
7.4 Special Rule for ESOP No. 2 Accounts and Additional
Contribution Securities Accounts. Notwithstanding anything to
the contrary set forth herein, in no event shall the foregoing
provisions of this Article VII (other than Section 7.1) apply to
any Qualifying Employer Securities purchased on account of, held
in, or distributed from, a Participant's ESOP No. 2 Accounts or
Additional Contribution Securities Account.
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ARTICLE VIII
PAYMENT OF BENEFITS
8.1 Form of Payment. (a) A Participant may elect that vested
benefits under the Plan distributed under Article V shall be
paid in (i) one lump sum or (ii) in parts as nearly as practical
(annually or more frequently) over a number of years not to
exceed the joint life expectancies of the Participant's spouse.
(b) Benefits paid under Section 5.4 on account of a
Participant's death, shall be distributed in one lump sum or in
installments over a period not extending beyond five years of
the Participant's date of death unless payment of benefits has
commenced before the Participant's date of death in which case
benefits shall be paid at least as rapidly as under the method
of distribution in effect on the Participant's date of death;
provided, however(1) if any portion of the Participant's Account
Balance is payable to or for the benefit of a Beneficiary, such
portion may be distributed over a period of time not exceeding
the life expectancy of such Beneficiary, provided distribution
begins not later than one year after the date of the
Participant's death or such later date as applicable regulations
under the Code may permit; or
(2) if the Beneficiary referred to above is the Par-
ticipant's surviving spouse, (1) the date on which the dis-
tribution is required to begin shall not be earlier than the
date on which the Participant would have attained age 70-1/2 and
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(2) if the surviving spouse should die before distribution to
such spouse begins, this Section 8.1(b) shall apply as if the
surviving spouse were the Participant.
(c)Distributions of benefits from Accounts other than ESOP
Accounts, Additional Contributions Securities Accounts and/or
Prior 401(k) Plan "A" Accounts shall be made in cash.
Distributions from a Participant's ESOP Accounts, Additional
Contributions Securities Accounts and/or Prior 401(k) Plan "A"
Accounts shall be made entirely in Qualifying Employer Securi-
ties or cash, as elected by the Participant, except that cash
distributions from ESOP Accounts, Additional Contributions Secu-
rities Accounts and/or Prior 401(k) Plan "A" Accounts shall be
made with respect to fractional shares, and amounts distributed
or transferred to an ESOP Diversification Account pursuant to
Section 6.3(a)(iv). Cash distributions of Qualifying Employer
Securities from a Participant's ESOP Accounts shall be effected
through the purchase by the Plan of such Qualifying Employer
Securities. Any Qualifying Employer Securities so purchased by
the Plan, unless purchased thereafter by the Company, shall be
held in the suspense account established pursuant to Section
6.3(d).
8.2 Commencement of Benefits. (a) Distributions from
a Participant's Accounts other than ESOP Accounts shall commence
as soon as practicable after the Valuation Date coincident with
or next following (whichever shall first occur) the date of the
Participant's Termination of Employment.
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(b)In the event of a Participant's Termination of Employment on
account of death, Disability or retirement on or after
attainment of Retirement Age, distributions from a Participant's
ESOP Accounts shall commence as soon as practicable after the
Valuation Date coincident with or next following (whichever
shall first occur) the date of such Termination of Employment.
(c)If a Participant's Termination of Employment for reasons
other than on account of death, Disability or retirement on or
after attainment of Retirement Age occurs (i) prior to January
1, 1988 or (ii) on or after January 1, 1994, then distributions
from such Participant's ESOP Accounts shall not commence to be
payable until after the Valuation Date coincident with or next
following (whichever shall first occur) the date such Former
Participant incurs one (1) Break in Service Year following such
Termination of Employment.
(d)Except as otherwise set forth herein, if a Participant's
Termination of Employment for reasons other than on account of
death, Disability or retirement on or after attainment of
Retirement Age occurs on or after January 1, 1988 through and
including December 31, 1993, then distributions from such
Participant's ESOP Accounts shall not commence to be payable
until after the Valuation Date coincident with or next following
(whichever shall first occur) the date such Former Participant
incurs five (5) Break in Service Years following such
Termination of Employment.
(e)If the Termination of Employment of a Participant who had
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attained age 55 and 15 Vesting Years of Service at the time of
such Termination of Employment, occurs on or after January 1,
1988 and through and including December 31, 1993 for reasons
other than on account of death, Disability or retirement on or
after attainment of Retirement Age, then distributions from such
Participant's ESOP Accounts shall commence to be payable
hereunder as soon as practicable after the Valuation Date coin-
cident with or next following (whichever shall first occur) such
Termination of Employment. If the Termination of Employment of
a Participant who had attained 15 Vesting Years of Service at
the time of such Termination of Employment occurs on or after
January 1, 1988 and through and including December 31, 1993 for
reasons other than on account of death, Disability, or
retirement on or after attainment of Retirement Age, then
distributions from such Former Participant's ESOP Accounts shall
commence as soon as practicable after the Valuation Date coinci-
dent with or next following (whichever shall first occur) the
date of (i) such Participant's attainment of age 55 or (ii) such
Participant's incurring five (5) Break in Service Years, which-
ever is earlier.
(f)Notwithstanding the foregoing, if the present value of the
Participant's nonforfeitable Account Balance is greater than
$3,500, such distribution may not commence before the
Participant's Retirement Date without his written consent to
such payment; and further provided that such distribution of
benefits must commence on or before the sixtieth (60th) day
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after the last day of the Plan Year in which (a) the Participant
attains his Retirement Date, (b) the Participant's Termination
of Employment occurs, or (c) the tenth anniversary of the year
in which the Participant commenced participation in the Plan
occurs, whichever is latest. Notwithstanding anything herein to
the contrary, the benefits of any Participant shall commence no
later than April 1 of the calendar year following the calendar
year in which the Participant attains age 70-1/2, regardless of
his continued employment, unless he elected a later commencement
date in an election made on or before December 31, 1983 pursuant
to Section 242(b) of the Tax Equity and Fiscal Responsibility
Act of 1982.
(g)Notwithstanding anything set forth herein to the contrary, in
no event shall distributions from a Participant's ESOP No. 1
Contribution Accounts commence later than the date required
under Code Section 409(o).
8.3 Inability to Ascertain Value of Account Balance. If the
value of a Participant's Account Balance cannot be ascertained
by the date benefits are required to commence as determined
pursuant to Section 8.2, a payment retroactive to such date may
be made no later than sixty (60) days after the earliest date on
which the amount of such payment can be ascertained.
8.4 Postponement of Commencement of Benefits In Certain Cases.
A Participant who retires pursuant to Section 5.2 on or after
his Retirement Date may, with the consent of the Committee,
elect in writing prior to his actual Retirement Date to postpone
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the commencement of the payment of benefits to a date selected
by such Participant; provided, however, that such benefits shall
commence not later than April 1st of the calendar year following
the year in which the Participant attains age 70 1/2 and will be
distributed over a period not longer than the life of the
Participant (or the joint lives of the Participant and his
designated Beneficiary) or over a period not extending beyond
the life expectancy of the Participant (or the joint life
expectancy of the Participant and his designated Beneficiary).
8.5 Payment or Distribution in Full Satisfaction; Receipt and
Release. Any payment or distribution to any person having or
claiming to have an interest in the Trust Fund or under this
Plan in accordance with the provisions of this Plan shall, to
the extent thereof, be in full satisfaction of all claims
against the Plan, the Trust Fund, the Committee, the Trustee,
and the Employer, any of whom may require such person, as a
condition precedent to such payment or distribution, to execute
a receipt and release therefor in such form as shall be
determined by the Committee, the Trustee or the Employer, as the
case may be.
8.6 Benefits of Unlocated Persons. Each Former Participant,
Beneficiary or other person entitled to receive benefits
hereunder shall be responsible for furnishing the Committee with
his address. If the Former Participant, Beneficiary, or any
other person entitled to benefits hereunder cannot be located,
the balance in the account of such person shall be segregated
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and invested in an Investment Fund selected by the Committee
until the person entitled to benefits makes claim therefor.
8.7 Special Provisions Applicable to Certain Transfers of
Assets from Other Plans.
(a)Spousal Death Benefits. Anything in this Plan to the
contrary notwithstanding, in the event that any Account of a
Participant (or a Former Participant) is a direct or indirect
transferee of a defined benefit plan, money purchase pension
plan, stock bonus or profit-sharing plan which would otherwise
have provided for a life annuity form of payment to the Partici-
pant (or Former Participant), then that portion of the Partici-
pant's (or Former Participant's) death benefits attributable to
such Account (including the proceeds of any life insurance poli-
cies constituting an asset of such Account) shall, unless waived
in accordance with Code Sections 401(a)(11) and 417, be distrib-
uted to the surviving spouse of the Participant (or Former Par-
ticipant) in the form of a qualified preretirement survivor
annuity (as defined in Code Section 417(c)) in accordance with
the provisions of Code Sections 401(a)(11) and 417.
(b)Spousal Retirement Benefit. Anything in this Plan to the
contrary notwithstanding, in the event that any Account of a
Participant (or Former Participant) is a direct or indirect
transferee of a defined benefit plan, money purchase pension
plan, stock bonus plan or profit sharing plan which would have
otherwise provided for a life annuity form of payment to the
Participant (or Former Participant), and such Participant (or
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Former Participant) is married on the date that benefits
commence hereunder, then the Participant's (or Former
Participant's) balance in such Account shall, unless waived in
accordance with Code Sections 401(a)(11) and 417, be distributed
to the Participant (or Former Participant) in the form of a
qualified joint and survivor annuity (as defined in Code Section
417(b)) in accordance with the provisions of Code Sections
401(a)(11) and 417.
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ARTICLE IX
ADMINISTRATION OF PLAN
9.1 Allocation of Powers Among Board, Trustee and Committee.
The Board, Trustee and the Committee shall have only those
specific powers, duties, responsibilities and obligations as are
specifically provided under this Plan or the Trust Agreement.
The Board shall have the responsibility to appoint and remove
the Trustee and the members of the Committee. The Committee
shall have the responsibility for the control and management of
the operation and administration of the Plan, except where the
Committee designates other persons to discharge such
responsibilities or where otherwise expressly provided in the
Plan. The Committee shall also have the responsibility to
appoint and remove Investment Managers. The Trustee shall have
the responsibility with respect to the management of the assets
held in the Trust Fund pursuant to the Plan, except with respect
to assets held or investments directed by an Investment Manager.
9.2 Number and Appointment of Committee. The Committee shall
consist of not less than two (2) members, who shall be appointed
by the Board and serve at its pleasure. Members of the
Committee need not be members of the Board. Upon the death,
resignation or removal of any member of the Committee, the Board
may, but need not, select a successor, if there are then at
least two (2) members.
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9.3 Acceptance, Removal and Resignation of Committee. Any
person appointed a member of the Committee shall signify his
assent by filing a written acceptance with the Board and with
the Committee. Any Committee member may be removed at any time
by the Board, with or without cause and written notice thereof
shall be sent to the member and the Committee. Any member of
the Committee may resign by delivering his written resignation
to the Board and to the Committee.
9.4 Organization of Committee and Meetings. The members of the
Committee may elect a Chairman, and a Secretary who may be, but
need not be, one of the members of the Committee. The Committee
shall hold meetings upon notice at such place or places, and at
such time or times as it may from time to time determine. Such
notice may be oral, by telecopy, telegraphic or written. Such
notice shall be duly served on or sent or mailed to each member
at least one (1) day before such meeting. Meetings may be held
at any time without notice if all the members are present, or if
at any time before or after the meeting those not present waive
notice of the meeting in writing.
9.5 Committee Actions. A majority of the members of the
Committee at the time in office shall constitute a quorum for
the transaction of business. All resolutions or other actions
taken by the Committee at any meeting shall be by the vote of a
majority of the members present at the meeting, unless unanimous
action is expressly provided for herein. Resolutions may be
adopted or other action taken without a meeting upon written
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consent signed by all the members of the Committee.
9.6 Execution of Documents. The Committee may sign, by an
authorized member or members, any document as and in the name of
the Committee, and the Committee may designate the member,
members, person or persons who may execute any document in the
name of the Committee.
9.7 Agent for Service of Process. The Plan Administrator shall
be the agent to receive service of legal process
with respect to the Plan.
9.8 General Powers of Committee. The Committee shall, except
as otherwise expressly provided herein, have full authority and
responsibility to control and manage the operation and
administration of the Plan in accordance with its provisions and
under laws applicable to the Plan. The powers and duties of the
Committee shall include, but not be limited to, the following:
(a) To designate such accountants, consultants,
administrators, counsel, custodians or investment advisors or
such other persons it deems necessary or advisable, who, except
for such custodians, shall serve the Committee as advisors only
and shall not exercise any discretionary authority,
responsibility or control with respect to the management or
administration of the Plan.
(b) To construe and interpret the provisions of
the Plan. Said constructions and interpretations shall be
consistent with regulations promulgated pursuant to the Code,
ERISA and any other applicable federal statute.
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(c) To determine all benefits and resolve all
questions arising from the administration, interpretation and
application of Plan provisions, either by general rules or by
particular decisions in a nondiscriminatory manner.
(d) To advise the Trustee or other disbursing
entity in writing with respect to all benefits which
become payable under the Plan, and to direct the Trus
tee or disbursing entity as to the manner in which
such benefits are to be paid.
(e) To adopt such forms and regulations as
deemed advisable for the administration of the Plan
and the conduct of its affairs.
(f) To designate one or more Investment Manag
ers.
(g) To divide or allocate assets held in the
Trust Fund and assign each portion to an Investment Manager.
(h) To designate a Plan Administrator by unani
mous approval.
(i) To remedy any inequity resulting from incor-
rect information received or communicated or as a con
sequence of administrative error.
(j) To assure that its members, the Trustee and
every other person who handles funds or other property of the
Plan are bonded as required by law.
(k) To settle or compromise any claim or debts
arising from the operation of the Plan and to commence
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or defend any claims in any legal or administrative
proceeding.
(l) To establish a funding policy and method to
determine the long and short-term growth and liquidity
objectives of the Plan and to advise the Trustee
and/or Investment Manager of such policy in order that
the investment policy of the Trustee and/or Investment
Manager shall be appropriately coordinated with the
requirements and needs of the Plan.
(m) To keep necessary records and data for the
proper administration of the Plan.
9.9 Allocation of Powers Among Committee Members. The
Committee may allocate specific duties and powers among its
members by written resolution, adopted and executed by approval
of a majority of the Committee. Such resolution shall remain in
effect until rescinded by a majority of the members of the Com-
mittee. Upon adoption, the member or members so designated
shall be solely liable, jointly and severally, for their acts or
omissions with respect to such specific responsibilities. All
other members, except as provided under Section 10.15, shall be
relieved from responsibility and liability for any act or omis-
sion resulting from such designation.
9.10 Delegation of Powers by Committee. The Committee may
designate any person, orally or in writing, to discharge any
responsibilities which the Committee determines are adminis-
trative or ministerial in nature and are designed to implement a
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policy, interpretation, plan, practice or procedure established
by the Committee.
9.11 Claims For Benefits and Appeals. Claims for
benefits shall be treated in accordance with the following
rules:
(a) Benefits hereunder may be paid only after
receipt by the Committee of a completed application on
a form to be supplied by the Committee.
(b) The Committee shall, by a majority, desig-
nate an employee of a member of the Controlled Group
who may be one of their number to pass upon claims for
benefits hereunder.
(c) If the claim is denied in whole or part, the
Claims Supervisor shall so notify the claimant within
sixty (60) days of the claim.
(d) The notice of claim denial shall, in lan-
guage calculated to be understood by the claimant:
(i)Specify the reason for the denial;
(ii)Specify the pertinent Plan provisions
on which the denial is based;
(iii)Furnish a description of any additional
material or information necessary for the claimant
to perfect the claim and provide an explanation of
why such material or information is necessary; and
(iv)Furnish an explanation of the review
procedure more fully set forth in Subparagraph
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(e).
(v) A failure to furnish a written notice
of the acceptance or denial of the claim within
sixty (60) days of the receipt of the claim shall
be deemed to be a denial of the claim.
(e) Upon denial of any claim, the claimant or
his duly authorized representative:
(i)Shall be afforded the opportunity, upon request,
to review the Plan and any other pertinent
documents.
(ii)May request a review by the entire Commit
tee of the denial by filing within seventy-five (75)
days of such denial a written request for a review and/or
hearing, and may, if desired, submit a written statement
together with such request for review. The Committee shall
order a hearing within thirty (30) days after receipt of the
request for review, if in its sole judgment, a hearing is
warranted.
(f) A decision on the appeal shall be made
no later than sixty (60) days after the receipt of the
request for review unless there is a need to hold a
hearing which requires an extension of time, or other
special circumstances arise, in which event a decision
shall be rendered no later than one-hundred twenty
(120) days after receipt by the Committee of a request
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for review.
9.12 Basic Fiduciary Responsibilities. All Fiduciaries shall
exercise their duties with respect to the Plan in accordance
with the instruments governing the Plan (as construed, when
necessary, by the Committee) and solely in the interest of
Participants, Former Participants, and their Beneficiaries for
the exclusive purposes of providing benefits to Participants,
Former Participants, and their Beneficiaries and defraying
reasonable expenses of administering the Plan (except where
otherwise expressly provided herein or otherwise provided by
law) and with the care, skill, prudence and diligence under the
circumstances then prevailing that a prudent man acting in a
like capacity and familiar with such matters would use in the
conduct of an enterprise of a like character and with like aims.
9.13 Co-Fiduciary Liability. In addition to any liability
arising from a breach of the duties set forth in Section 9.12, a
Fiduciary shall be liable for a breach of fiduciary
responsibility by another Fiduciary only if:
(a)He knowingly participates in or undertakes to
conceal an act or omission of such other Fiduciary,
knowing such act or omission is such a breach;
(b)By his failure to comply with said Section 9.12 in
the administration of his specific responsibilities
giving rise to his status as a Fiduciary, he has
enabled such other Fiduciary to commit such a breach;
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or
(c)He has knowledge of such a breach by such other
Fiduciary and does not make reasonable efforts under
the circumstances to remedy the breach;
provided, however, that if one or more Investment
Managers have been appointed, then notwithstanding
Subparagraphs (b) or (c) of this Section 9.13, no
Fiduciary shall be liable for the acts or omissions of
such Investment Managers.
9.14 Review Where Duties or Responsibilities Are
Allocated or Delegated. If any duties or
responsibilities are allocated or delegated to any
person by the Committee pursuant to Sections 9.9, 9.10
or 9.11, the Committee shall periodically review the
performance of such person. Depending upon the cir-
cumstances, this requirement may be satisfied by a
formal review by the Committee at such time or times
as the Committee in its discretion may determine,
through day-to-day contact and evaluation, or in any
other appropriate way determined by the Committee.
9.15 Fiduciary Liability In Event of Allocation or
Delegation of Responsibilities. Notwithstanding
anything to the contrary, if responsibilities have
been allocated or delegated to another pursuant to
Sections 9.9, 9.10 or 9.11, then a Fiduciary shall not
be liable for an act or omission of such person in
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carrying out the responsibility except to the extent
that it is established that the Fiduciary (a) would
otherwise be liable under Section 9.13, or (b)
violated the duties set forth in Sections 9.12 or
9.14, or both, with respect to such allocation or
designation with respect to the establishment or
implementation of the allocation procedure, or in
continuing the allocation or designation.
9.16 No Compensation For Committee Membership. No
member of the Committee shall receive any compensation
for his services as such.
9.17 Committee Member as Participant. A Committee
member may be a Participant hereunder, except that
such person may not make decisions and execute
instruments as a Committee member with respect to
matters relating solely to his own participation.
9.18 Payment of Expenses. Any expenses incurred by
the Committee shall be paid by the Trust Fund unless
paid for by the Employer.
9.19 Withholding of Benefits in the Event of Dispute.
In the event any dispute shall arise as to the person
to whom payment of any benefits hereunder shall be
made, or as to the person to whom delivery of any
property shall be made by the Trustee, the Committee
may direct the Trustee to withhold such payment and/or
delivery until such dispute shall have been determined
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by a court of competent jurisdiction or shall have
been settled by the parties concerned.
9.20 No Discrimination. The Committee shall not take
any action which would result in benefiting one
Participant or group of Participants at the expense of
another, or in discrimination as between Participants
similarly situated, or by the application of different
rules to substantially similar sets of facts.
9.21 Indemnification of Fiduciaries. Except for lia-
bility resulting from gross negligence or willful
misconduct, to the extent not insured against by a
member of the Controlled Group, the Company shall, to
the full extent permitted by law, indemnify and hold
harmless all Fiduciaries who are employees or members
of the board of directors of a member of the
Controlled Group against all liabilities incurred in
connection with the control, management,
administration and operation of the Plan and with
respect to the appointment of an Investment Manager.
9.22 Right of Board to Transfer Power. Wherever the
Board is given a power or duty under the Plan, the
Board may by general resolution or with respect to a
specific matter or matters transfer that power or duty
to the Committee or to any committee of the Board,
subject to the right of the Board to terminate such
transfer at any time.
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9.23 Conclusive Effect of Committee Decisions. The
determination of the Committee made in good faith as
to any question arising hereunder, including questions
of construction, administration and interpretation,
shall be final and conclusive upon all persons,
including, but not by way of limitation, Employers,
Trustees, Fiduciaries, Investment Managers, Employees,
Participants, Former Participants, Beneficiaries,
heirs, distributees and the legal representatives of
all such persons.
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ARTICLE X
AFFILIATED EMPLOYERS
10.1 Adoption of Plan and Trust By Members of
the Controlled Group. Any member of the Controlled
Group may, with the approval of the Board, adopt this
Plan and become a party to the Trust Agreement, on
such terms and conditions as the Board may specify.
10.2 Appointment of Company as Agent of Adopting
Employers. Any member of the Controlled Group which
becomes an Employer pursuant to Section 10.1 shall be
deemed to have appointed the Company as its agent with
respect to all matters pertaining to the Plan, Trust
Agreement and Trust Fund such as but not limited to,
the appointment of Committee members and Trustee, and
shall be deemed to have adopted all amendments to the
Plan and Trust Agreement which are adopted by the
Company, unless such Employer takes specific action to
the contrary.
10.3 Right of Employer To Withdraw From or
Terminate Participation. Any Employer may, upon
thirty (30) days notice, withdraw from or terminate
its participation in the Plan.
10.4 Procedure Upon Withdrawal From
Participation. Upon the withdrawal from participation
in the Plan by an Employer, the Trustee shall
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segregate the share of the assets of the Trust Fund
allocable to the Accounts of the Participants who are
Employees of the withdrawing Employer. Such assets
may be transferred by the Trustee to a trust
established by the withdrawing Employer ("Transferee
Trust"). Such transfer shall be conditioned upon
receipt from the Internal Revenue Service of a
determination that the Transferee Trust is exempt
under Code Section 501(a), and upon any other
approvals or conditions as may be reasonably required
by the Company, the Committee or the Trustee.
10.5 Procedure Upon Termination of Plan by
Employer. Upon the termination of the Plan with
respect to an Employer, the Trustee shall segregate
the share of the assets of the Trust Fund allocable to
the Accounts of the Participants who are Employees of
the terminating Employer and shall distribute said
Accounts in accordance with Section 12.6, provided,
however, in the case of any Employees of said
terminating Employer who are Employees of an Employer
which remains an Employer, the Accounts shall be
retained in the Trust Fund and distributed to such
Employees when they cease to be Participants
hereunder.
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ARTICLE XI
AMENDMENT OF PLAN
11.1 Amendment of Plan. Subject to the limitations
and provisions herein contained, the Board, by
resolution duly passed, shall have the power, at any
time and from time to time, to modify, alter or amend
the Plan in any manner which it deems desirable,
including, but not by way of limitation, the right to
increase or decrease contributions, to provide a
different benefit formula, to change any provision
relating to the distribution or payment, or both, of
any of the assets of the Trust. In no event shall
Section 4.2(d) of the Plan be amended more than once
in any six (6) month period other than to comply with
the Code, ERISA, or the rules thereunder.
11.2 Amendment to Qualify the Plan and to Exempt
the Trust Under Internal Revenue Code.
Notwithstanding any other provision to the contrary,
the Committee shall have the power to amend the Plan
approved by the Commissioner of Internal Revenue under
the provisions of the Code, to keep the Plan so
approved, and to maintain the Trust provided for
herein as an exempt trust under the law or any
regulations or rulings promulgated thereunder.
11.3 Limitations. The Company shall not have
the right to amend the Plan and Trust in the following
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respects:
(a) No amendment may be made to the Plan or
Trust Agreement which shall vest in the Company or any
other Employer, directly or indirectly, any interest
in, or ownership of, any of the present or subsequent
funds set aside for Participants, Former Participants
or their Beneficiaries pursuant to the Trust, except
as otherwise expressly provided herein;
(b) No part of the Trust Fund shall by
reason of any amendment, be used for or diverted to
purposes other than for the exclusive benefit of
Participants, Former Participants or their
Beneficiaries or for administration expenses of the
Trust, except as otherwise expressly provided herein;
(c) No amendment shall deprive any
Participant, Former Participant or Beneficiary of any
of the benefits to which he is entitled under the
Trust Fund with respect to contributions previously
made;
(d) No amendment shall be made which will
increase the powers, duties and liabilities of the
Trustee without its written consent.
11.4 Election For Certain Members If Amendment To Vesting
Schedule. In the event of an amendment which changes the
vesting schedule contained herein, any Participant who has been
credited with not less than three (3) Years of Service as of the
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end of the "Election Period" set forth below may make an
irrevocable election during such Election Period to have his
benefit determined under the pre-amendment vesting schedule with
respect to such Participant's Account Balance, including any
adjustments thereto after the amendment. The Election Period
shall begin no later than the date the Plan amendment is adopted
by the Board and shall end on the latest of: (a) sixty (60)
days after the amendment is adopted, (b) sixty (60) days after
the effective date of the amendment, or (c) sixty (60) days
after the Participant is issued written notice of the amendment
by the Employer or Plan Administrator.
11.5 Merger or Consolidation of Plan or Transfer of
Assets. A merger of the Plan with any other plan described in
Code Section 401(a) or a merger of any Employer with any other
entity shall not in and of itself result in the termination of
the Plan with respect to any Employer or group of Employees.
However, in the event that the Plan is merged or consolidated
with another plan, or in the event of a transfer of the assets
or liabilities held pursuant to the Plan to another plan, each
Participant must be entitled to a benefit under such other plan
immediately after such merger, consolidation or transfer which
is at least equal to the value of his Account under the Plan if
the Plan terminated immediately before such merger, consolida-
tion or transfer of assets.
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ARTICLE XII
DISCONTINUANCE OF CONTRIBUTIONS
AND TERMINATION OF PLAN AND TRUST
12.1 Intent. The Company intends that (i) the ESOP No. 1
Accounts portion of the Plan shall constitute an employee stock
ownership plan within the meaning of Code Section 4975(e)(7) and
(ii) the ESOP No. 2 Accounts portion of the Plan shall
constitute a stock bonus plan.
12.2 Termination of Plan by the Company. The Board shall
have the power at any time and for any reason to terminate the
Plan by an appropriate resolution or resolutions which shall
specify the date of termination.
12.3 Vesting Upon Termination of Plan. Except as
otherwise set forth in this Section 12.3, upon the complete or
partial termination of the Plan for any reason whatsoever, or
the complete discontinuance of contributions, the balance in
each Participant's or Former Participant's Account (after pay-
ment of all expenses and proportional adjustment of Partici-
pants' Accounts to reflect such expenses, profits, losses and
reallocations of forfeitures of the Trust Fund) shall become
fully vested and nonforfeitable and each Participant or Former
Participant or Beneficiary thereof shall be entitled to receive
the amount credited to his account in the Trust Fund subject to
any further expenses, profits and losses which may occur prior
to actual distribution. Notwithstanding the foregoing, in the
event of a partial termination of the Plan, the full vesting and
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non-forfeitable rights set forth in the preceding sentence shall
apply only to the portion of the Plan that is terminated.
12.4 Continuance of Trust Fund After Termination of Plan.
After termination of the Plan for any reason, the Employer shall
make no further contributions thereunder. However, unless the
Committee in its sole discretion directs otherwise, the Trust
Fund shall remain in existence and all of the other provisions
of the Plan shall remain in force which are necessary in the
opinion of the Trustee, other than the provisions for the
contributions by the Employer and forfeitures of Participants'
interests.
12.5 Administration. All of the assets on hand on the
date of the termination of the Plan as aforesaid shall be held,
administered and distributed by the Trustee in the manner
provided in the Plan.
12.6 Distribution of Trust Fund Assets. Notwithstanding
Sections 12.2 and 12.3, upon the complete or partial termination
of the Plan, the termination of an Employer's participation in
the Plan by such Employer, or the complete discontinuance of
contributions to the Plan, the Committee may direct the Trustee
to distribute the accounts of each affected Participant, Former
Participant or Beneficiary in accordance with the provisions of
Article VIII. If a Former Participant or Beneficiary dies
before the amount in his account has been completely
distributed, the balance shall be paid to his Beneficiary in a
lump sum. In the event there are no Committee members acting
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hereunder after termination of the Plan, the Trustee may exer-
cise the powers of the Committee under this Section 12.6. In
addition, if there is not a quorum of the Board acting at any
time sufficient to exercise the powers of the Board with respect
to the Plan and Trustee, the Trustee may exercise such powers,
including, but not limited to, the power to terminate the Trust
Fund.
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ARTICLE XIII
CERTAIN PROVISIONS AFFECTING THE EMPLOYER
13.1 No Contract Between Employer and Employee. The adoption
and maintenance of the Plan shall not be deemed to constitute a
contract between the Employer and any Employee, or to be a
consideration for, or an inducement or condition of the
Employment of any person. Nothing contained in this Plan nor
any action taken hereunder shall be deemed to give to any
Employee the right to be retained in the employ of the Employer
or to interfere with the right of the Employer to discharge any
Employee at any time, nor shall it be deemed to give to the
Employer the right to require the Employee to remain in his
employ, nor shall it interfere with the Employee's right to ter-
minate his employment at any time.
13.2 Employer Not Liable for Benefit Payments. All
benefits payable under the Plan shall be paid or provided for
solely from the Trust Fund, and the Employer assumes no lia-
bility or responsibility therefor.
13.3 Information to be Furnished by the Employer. As soon
as practicable after the close of each Plan Year for which the
Employer shall make a contribution to the Trustee, the Employer
shall deliver to the Committee and Trustee a full and complete
list of all Employees entitled to participate in the Plan and
any necessary information pertaining thereto. Whenever
requested by the Trustee, the Employer shall furnish to the Com-
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mittee and Trustee such other information as may be necessary
for either of them to perform their duties in accordance with
the provisions of the Plan.
13.4 Reliance on Written Communications. The Committee,
the Trustee and the Employer and its officers and directors,
shall be fully protected in acting or refraining to act in
reliance upon any writing, including but not by way of limita-
tion, any certificate, notice, resolution, request, consent,
order, direction, report, appraisal, opinion, telecopy, tele-
gram, cablegram, radiogram, letter, paper, instrument or docu-
ment, believed by them or any of them to be genuine and to be
signed or presented by the proper person or persons, and none of
them shall be under any duty to make any investigation or
inquiry as to any statement contained in any of such writings
but may accept the same as conclusive evidence of the truth and
accuracy of the statements therein contained. Any of them, in
his or their discretion, may in lieu thereof accept other evi-
dence of the matter or may require such further evidence of the
matter as to him or them may seem reasonable.
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ARTICLE XIV
MISCELLANEOUS PROVISIONS
14.1 No Diversion of Trust Fund. It shall be impossible under
any conditions, for any part of the corpus or income of the
Trust Fund to be used for, or diverted to, purposes other than
for the exclusive benefit of the Participants, Former Par-
ticipants or their Beneficiaries, including the payment of the
expenses of the administration of the Plan or of the Trust Fund
or both.
14.2 Non-Alienation of Benefits. Subject to the receipt
by the Committee of a Qualified Domestic Relations Order (as
defined in Section 14.3), the right of any Participant, Former
Participant or his Beneficiary in any benefit, payment or to any
separate account under the Plan or Trust Fund shall not be
subject to alienation or assignment, and if such Participant,
Former Participant or Beneficiary shall attempt to assign,
transfer or dispose of such right or should such right be sub-
ject to attachment, execution, garnishment, sequestration or
other legal, equitable or other process, it shall ipso facto
pass to such person or persons as may be appointed by the Com-
mittee from among the Beneficiaries, if any, theretofore desig-
nated by such Participant or Former Participant and the spouses
and blood relatives of such Participant or Former Participant,
provided, however, that the Committee, in its sole discretion,
may reappoint the Participant or Former Participant to receive
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any payment thereafter becoming due either in whole or in part.
Any appointment made by the Committee hereunder may be revoked
by the Committee at any time and a further appointment made by
it.
14.3 Qualified Domestic Relations Order. "Qualified
Domestic Relations Order" means any judgment, decree or order
(including approval of a property settlement agreement) which
has been determined by the Committee, in accordance with the
procedures established under the Plan, to constitute a Qualified
Domestic Relations Order within the meaning of Code Section
414(p)(1).
14.4 Mailing of Policies, Payments and Notices. The
Committee, Trustee or the Company may deliver any policy, pay-
ment, check, notice or other property required to be delivered
hereunder or under the Trust Fund by mailing same to the person
to whom such delivery is to be made. Where delivery is made by
mail, it shall be deemed to have been so sent if enclosed in a
securely sealed, postpaid wrapper and deposited in a United
States Post Office Department Mailbox, addressed to the person
to whom it is to be mailed at such address as may have been last
furnished to the Committee or the Trustee, or, if no such
address shall have been so furnished, to such person in care of
the Employer. Neither the Committee nor the Trustee shall be
required to make any investigation to determine the mailing
address of any person entitled to benefits hereunder.
14.5 Necessary Parties in Certain Actions and Proceedings.
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In any action or proceeding affecting all or any part of the
Plan or Trust Fund or the administration thereof, or for the
settlement of the Trustee's accounts or for the determination of
any factual question or question of construction which may arise
or for instructions to the Trustee, the only necessary parties
shall, except as otherwise required by law, be the Company, the
Committee and the Trustee.
14.6 Internal Revenue Service Approval. The Plan and its
related Trust Fund are contingent upon and subject to the
obtaining of the initial approval of the Internal Revenue Ser-
vice as may be necessary to establish the deductibility for
income tax purposes of contributions made by the Employer under
the Plan and Trust Fund under Code Sections 401 and 501, or of
any similar provision hereinafter adopted. The Plan and Trust
Fund shall be interpreted and administered in a manner consis-
tent with such qualification and exemption.
14.7 Binding Nature of Agreement. This Plan shall be
binding upon the heirs, executors, administrators, successors
and assigns of any and all parties hereto present and future.
14.8 Construction. Where any legal question pertaining to
the Plan and Trust involves the law of any state, it shall be
determined in accordance with the laws of the State of New York.
14.9 Headings. The headings and articles are included
solely for convenience or reference, and if there is any
conflict between such headings and the text, the text shall
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control.
14.10 Gender and Number. The masculine gender shall
include the feminine, the feminine gender shall include the mas-
culine and the singular shall include the plural unless the con-
text clearly indicates otherwise.
14.11 Provisions Severable. In the event that any
provision of this Plan shall be determined to be illegal or
invalid for any reason, said illegality or invalidity shall not
affect the remaining provisions of this Plan but shall be sever-
able and the Plan shall be construed and enforced as if said
illegal or invalid provision had never been inserted therein.
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SWANK, INC.
1994 NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
NON-QUALIFIED STOCK OPTION CONTRACT
THIS NON-QUALIFIED STOCK OPTION CONTRACT entered into
as of the 31st day of December 1994, between Swank, Inc., a
Delaware corporation (the "Company"), and Raymond Vise (the
"Optionee").
W I T N E S S E T H
1. The Company, in accordance with the terms and
conditions of the 1994 Non-Employee Director Stock Option Plan of
the Company (the "Plan"), grants as of December 31, 1994 to the
Optionee an option to purchase an aggregate of 5,000 shares of
the Common Stock, $.10 par value per share, of the Company
("Common Stock"), at $1.15625 per share, being 100% of the fair
market value of such shares of Common Stock on such date.
2. The term of this option shall be 5 years from
December 31, 1994, subject to earlier termination as provided in
this Contract and in the Plan. This option shall become
exercisable as to 100% of the total number of shares of Common
Stock subject hereto upon approval of the Plan by stockholders of
the Company as contemplated by paragraph 15 of the Plan and
paragraph 10 of this Contract.
3. This option shall be exercised by giving written
notice to the Company at its principal office, presently 6 Hazel
Street, Attleboro, Massachusetts 02703-0962, Attention:
Treasurer, stating that the Optionee is exercising this stock
option, specifying the number of shares being purchased and
accompanied by payment in full of the aggregate purchase price
thereof in cash or by check. In no event may a fraction of a
share of Common Stock be purchased under this option.
4. Notwithstanding the foregoing, and without
limiting the provisions of paragraph 11 of the Plan, this option
shall not be exercisable by the Optionee unless (a) a
registration statement under the Securities Act of 1933, as
amended (the "Securities Act") with respect to the shares of
Common Stock to be received upon the exercise of the option shall
be effective and current at the time of exercise or (b) there is
an exemption from registration under the Securities Act for the
issuance of the shares of Common Stock upon exercise. At the
request of the Board of Directors, the Optionee shall execute and
deliver to the Company his representation and warranty, in form
and substance satisfactory to the Board of Directors, that the
shares of Common Stock to be issued upon the exercise of the
option are being acquired by the Optionee for his own account,
for investment only and not with a view to the resale or
<PAGE>
distribution thereof without the meaning of the Securities Act.
Nothing herein shall be construed so as to obligate the Company
to register the shares subject to the option under the Securities
Act.
5. Notwithstanding anything herein to the contrary,
if at any time the Board of Directors shall determine, in its
discretion, that the listing or qualification of the shares of
Common Stock subject to this option on any securities exchange or
under any applicable law, or the consent or approval of any
governmental regulatory body, is necessary or desirable as a
condition of, or in connection with, the granting of an option,
or the issue of shares of Common Stock thereunder, this option
may not be exercised in whole or in part unless such listing,
qualification, consent or approval shall have been effected or
obtained free of any conditions not acceptable to the Board of
Directors, in its discretion.
6. Nothing in the Plan or herein shall confer upon
the Optionee any right to continue as a director of the Company.
7. The Company may endorse or affix appropriate
legends upon the certificates for shares of Common Stock issued
upon exercise of this option and may issue such "stop transfer"
instructions to its transfer agent in respect of such shares as
it determines, in its discretion, to be necessary or appropriate
to (a) prevent a violation of, or to perfect an exemption from,
the registration requirement of the Securities Act, or (b)
implement the provisions of the Plan or any agreement between the
Company and the Optionee with respect to such shares of Common
Stock.
8. The Company and the Optionee agree that they will
both be subject to and bound by all of the terms and conditions
of the Plan, a copy of which is attached hereto and made part
hereof. In the event the Optionee is no longer a director of the
Company or in the event of his death or disability (as defined in
the Plan), his rights hereunder shall be governed by and be
subject to the provisions of the Plan. In the event of a
conflict between the terms of this Contract and the terms of the
Plan, the terms of the Plan shall govern.
9. The Optionee represents and agrees that he will
comply with all applicable laws relating to the Plan and the
grant and exercise of the option and the disposition of the
shares of Common Stock acquired upon exercise of the option,
including without limitation, federal state securities and "blue
sky" laws.
10. This option has been granted pursuant to the Plan,
which is subject to approval by the stockholders of the Company
at the next meeting of stockholders. Accordingly, and
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notwithstanding anything contained in this Contract or the Plan
to the contrary, in the event that the Plan is not approved by
stockholders at such meeting, the Plan and this Option shall
immediately terminate and shall be of no further force or effect.
11. This option is not transferrable otherwise than by
will or the laws of descent and distribution and may be
exercised, during the lifetime of the Optionee, only by him or
his legal representatives.
12. This Contract shall be binding upon and inure to
the benefit of any successor or assign of the Company and to any
heir, distributee, executor, administrator or legal
representative entitled under the Plan and by law to the
Optionee's rights hereunder.
13. This Contract shall be governed by and construed
in accordance with the laws of the State of Delaware.
14. The invalidity or illegality of any provision
herein shall not affect the validity of any other provision.
15. The Optionee agrees that the Company may amend the
Plan and the options granted to the Optionee under the Plan,
subject to the limitations contained in the Plan.
IN WITNESS WHEREOF, the parties hereto have executed
this contract as of the day and year first above written.
SWANK, INC.
By: \s\ MARSHALL TULIN
Its: President
\s\ RAYMOND VISE
Optionee
8 El Paseo
Address
Irvine, CA 92715
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