As filed with the Securities and Exchange Commission on December 20, 1996
Registration No. 333-______
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------------
TEJAS GAS CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 76-0263364
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1301 MCKINNEY ST., SUITE 700 77010
HOUSTON, TEXAS (Zip Code)
(Address of Principal Executive Offices)
----------------------
TEJAS GAS CORPORATION THRIFT PLAN
(Full title of the plan)
----------------------
P. ANTHONY LANNIE
SENIOR VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
TEJAS GAS CORPORATION
1301 MCKINNEY ST., SUITE 700
HOUSTON, TEXAS 77010
(Name and address of agent for service)
(713) 658-0509
(Telephone number, including area code, of agent for service)
----------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
=========================================== ============= ================ ===================================
Proposed Proposed maximum
Amount to be maximum offering aggregate offering Amount of
Title of securities to be registered registered price per share (1) price (1) registration fee (3)
=========================================== ============= ================ ===================================
<S> <C> <C> <C> <C>
Common Stock, par value $.25 per share (2) 500,000 $43.6875 $21,843,750 $6,619.32
Depositary Shares, each share representing
one-tenth of a share of 9.96% Cumulative
Preferred Stock, par value $1.00 per
share.................................... 100,000 $26.5625 $2,656,250 $804.92
9.96% Cumulative Preferred Stock, par
value $1.00 per share.................... 10,000 -- -- --
=========================================== ============= ================ ===================================
</TABLE>
(1) Estimated pursuant to Rules 457(c) and (h) solely for purposes of computing
the registration fee and based upon the average of the high and low sales
prices reported on the New York Stock Exchange Composite Tape on December
17, 1996.
(2) Includes the preferred stock purchase rights associated with the Common
Stock.
(3) As no separate consideration is payable for the preferred stock purchase
rights associated with the Common Stock, the registration fee for such
securities is included in the fee for the Common Stock.
In addition, pursuant to Rule 416(c), this Registration Statement also covers an
indeterminate amount of interests to be offered or sold pursuant to the employee
benefit plan described herein.
Pursuant to Rule 429 under the Securities Act of 1933, the prospectus to which
this Registration Statement relates is a combined prospectus that also relates
to the following Registration Statements on Form S-8: Reg. No. 33-32792
previously filed by the registrant on December 20, 1989; Reg. No. 33-44615
previously filed by the registrant on December 20, 1991; Reg. No. 33-60064
previously filed by the registrant on March 26, 1993, as amended; Reg. No.
33-70746 previously filed by the registrant on October 22, 1993, as amended; and
Reg. No. 33-91436 previously filed by the registrant on April 21, 1995.
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
Note: The document(s) containing the information concerning the
Tejas Gas Corporation Amended and Restated Thrift Plan, as amended and restated
effective January 1, 1997 (and all amendments thereto) (the "Plan"), required by
Item 1 of Form S-8 and the statement of availability of registrant information,
Plan information and other information required by Item 2 of Form S-8 will be
sent or given to employees as specified by Rule 428. In accordance with Rule 428
and the requirements of Part I of Form S-8, such documents are not being filed
with the Securities and Exchange Commission (the "Commission") either as part of
this Registration Statement or as prospectuses or prospectus supplements
pursuant to Rule 424. The registrant will maintain a file of such documents in
accordance with the provisions of Rule 428. Upon request, the registrant will
furnish to the Commission or its staff a copy of any or all of the documents
included in such file.
To the extent applicable under the Plan, as has been the case
with all securities registered under the Securities Act of 1933, as amended (the
"Securities Act"), for issuance under the Plan, pursuant to Rule 416 under the
Securities Act, the securities registered hereby are deemed to cover any
additional shares of Common Stock, par value $.25 per share, 9.96% Cumulative
Preferred Stock, par value $1.00 per share ("Preferred Stock"), or Depositary
Shares representing such Preferred Stock of Tejas Gas Corporation issued or
issuable as a result of a stock split, stock dividend or similar transaction
relating to the securities registered hereby.
I-1
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
This Registration Statement on Form S-8 is filed to register for
issuance pursuant to the Tejas Gas Corporation Thrift Plan the number of
additional securities of the registrant set forth on the cover page hereof. Five
prior Registration Statements (Registration Nos. 33-32792, 33-44615, 33-60064,
33-70746 and 33-91436) have previously been filed with respect to securities
issuable under said Thrift Plan. In accordance with General Instruction E to
Form S-8, the contents of said Registration Statements, as amended, are
incorporated herein by reference.
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE.
The following documents, which the registrant, Tejas Gas
Corporation (the "Company"), has filed with the Commission pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange Act") (File No. 0-
17389), are incorporated in this Registration Statement by reference and shall
be deemed to be a part hereof:
(1) The Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1995;
(2) The Plan's Annual Report on Form 11-K for the fiscal year
ended December 31, 1995;
(3) The Company's Quarterly Reports on Form 10-Q for the quarters
ended March 31, June 30 and September 30, 1996;
(4) The Company's Current Reports on (i) Form 8-K/A dated January
31, 1996 (amending Form 8-K dated November 2, 1995) and (ii) Form 8-K
dated June 18, 1996 (as amended by Form 8-K/A dated July 17, 1996);
(5) The description of the Company's common stock, par value
$0.25 per share (the "Common Stock"), contained in the Company's
Registration Statement on Form 8-A filed on December 3, 1992 as amended
by Forms 8-A/A filed on September 17, 1993 and March 18, 1994, as such
Registration Statement may be further amended from time to time for the
purpose of updating, changing or modifying such descriptions;
(6) The description of the Company's preferred stock purchase
rights associated with the Common Stock contained in the Company's
Registration Statement on Form 8-A filed on November 14, 1994; and
(7) The description of the Company's 9.96% Cumulative Preferred
Stock, par value $1.00 per share (the "Preferred Stock"), and the
description of the Company's Depositary Shares (the "Depositary
Shares"), each share representing a one-tenth interest in a share of
Preferred Stock, contained in the Company's Registration Statement on
Form 8-A dated January 11, 1993 relating to the Preferred Stock and the
Depositary Shares, as amended on March 25, 1993 and as such Registration
Statement may be further amended from time to time for the purpose of
updating, changing or modifying such descriptions.
All documents filed by the Company with the Commission pursuant
to sections 13(a), 13(c), 14 and 15(d) of the Exchange Act subsequent to the
date of this Registration Statement and prior to the filing of a post-effective
amendment to this Registration Statement which indicates that all securities
offered hereby have been sold, or which deregisters all securities then
remaining unsold, shall be deemed to be incorporated in this Registration
Statement by reference and to be a part hereof from the date of filing of such
documents.
Any statement contained in this Registration Statement, in an
amendment hereto or in a document incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Registration Statement
to the extent that a statement contained herein or in any subsequently filed
supplement to this Registration Statement or in any document that also is
incorporated by reference herein modifies or supersedes such statement. Any
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Registration Statement.
II-1
<PAGE>
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article Ninth of the Company's Charter provides that to the
fullest extent that the General Corporation Law of the State of Delaware permits
the limitation or elimination of the liability of directors, no director of the
Company shall be personally liable to the Company or its stockholders for
damages for breach of fiduciary duty as a director. Notwithstanding the
foregoing, a director shall be liable to the extent provided by applicable law
(1) for any breach of the director's duty of loyalty to the Company or its
stockholders, (2) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (3) for any willful or
negligent declaration of an unlawful dividend, stock purchase or redemption or
(4) for any transaction from which the director derived any improper personal
benefit.
Article Tenth of the Company's Charter provides that the Company
shall indemnify each person who was or is made a party or is threatened to be
made a party to or is involved in any threatened, pending or completed action,
suit or proceeding, by reason of the fact that he or she is or was a director or
officer of the Company, including service with respect to employee benefit
plans, whether the basis of such proceeding is alleged action in an official
capacity as a director, officer, employee or agent or alleged action in any
other capacity while serving as a director, officer, employee or agent, to the
maximum extent authorized by the General Corporation Law of the State of
Delaware.
Section 13.9 of the Plan provides that the Company shall
indemnify each person who was or is a member of the Committee appointed by the
Board of Directors to administer the Plan, the Trustee of the Plan and other
fiduciaries of the Plan who are employees of the Company against any liabilities
incurred in the exercise and performance of such person's powers and duties
under the Plan to the extent such protection would be afforded by insurance
coverage under Section 410(b)(3) of the Employee Retirement Income Security Act
of 1974, as amended.
Section 145 of the General Corporation Law of the State of
Delaware authorizes the indemnification of directors and officers against
liability incurred by reason of being a director or officer and against expenses
(including attorneys' fees) in connection with defending any action seeking to
establish such liability, in the case of third-party claims, if the officer or
director acted in good faith and in a manner he reasonably believed to be in or
not opposed to the best interests of the corporation, and in the case of actions
by or in the right of the corporation, if the officer or director acted in good
faith and in a manner he reasonably believed to be in or not opposed to the best
interests of the corporation and if such officer or director shall not have been
adjudged liable to the corporation, unless a court otherwise determines.
Indemnification is also authorized with respect to any criminal action or
proceeding where the officer or director had no reasonable cause to believe his
conduct was unlawful.
The Company has purchased a liability insurance policy covering
its directors and officers against certain losses.
The above discussion of the Company's Charter, the Plan and
Section 145 of the General Corporation Law of Delaware is intended to be only a
summary and is qualified in its entirety by the full text of each of the
foregoing.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable.
II-2
<PAGE>
ITEM 8. EXHIBITS.
Exhibit
NUMBER DOCUMENT DESCRIPTION
- ------ --------------------
*4.1 - Certificate of Incorporation of Tejas Gas Corporation (filed as
Exhibit 3.1 to Tejas Gas Corporation's Registration Statement
on Form S-1, Registration No. 33-24697).
*4.2 - Certificate of Amendment to Certificate of Incorporation of
Tejas Gas Corporation dated May 12, 1993 (filed as Exhibit 4.3
to Tejas Gas Corporation's Quarterly Report on Form 10-Q for
the quarter ended June 30, 1993).
*4.3 - By-laws of Tejas Gas Corporation (filed as Exhibit 3.2 to Tejas
Gas Corporation's Registration Statement on Form S-1,
Registration No. 33-24697).
*4.4 - Certificate of Designation of 9.96% Preferred Stock dated
January 26, 1993 (filed as Exhibit 2(c) to Amendment No. 1 to
Tejas Gas Corporation's Registration Statement on Form 8-A
(filed on March 25, 1993) relating to Tejas Gas Corporation's
9.96% Depositary Shares and 9.96% Preferred Stock.
*4.5 - Rights Agreement, dated as of November 11, 1994, between Tejas
Gas Corporation and Harris Trust and Savings Bank, which
includes the Certificate of Designation for the Series C Junior
Participating Preferred Stock as EXHIBIT A, the form of Right
Certificate as EXHIBIT B, and the Summary of Rights to Purchase
Preferred Shares as EXHIBIT C (filed as Exhibit 1 to Tejas Gas
Corporation's Current Report on Form 8-K dated November 11,
1994).
*4.6 - Specimen Stock Certificate for Common Stock (filed as Exhibit
4.4 to Tejas Gas Corporation's Quarterly Report on Form 10-Q
for the quarter ended June 30, 1993).
*4.7 - Specimen Stock Certificate for 9.96% Preferred Stock (filed as
Exhibit 4(e) to Tejas Gas Corporation's Registration Statement
on Form S-2, No. 33-53862).
*4.8 - Specimen Depositary Receipt representing 9.96% Depositary
Shares (filed as Exhibit 4(d) to Tejas Gas Corporation's
Registration Statement on Form S-2, No. 33-53862).
*4.9 - Deposit Agreement dated as of January 26, 1993 among Tejas Gas
Corporation, Harris Trust and Savings Bank and all holders from
time to time of depositary receipts issued thereunder (filed as
Exhibit 2(d) to Amendment No.1 to Tejas Gas Corporation's
Registration Statement on Form 8-A (filed on March 25, 1993)
relating to Tejas Gas Corporation's 9.96% Depositary Shares and
9.96% Preferred Stock).
4.10 - Tejas Gas Corporation Amended and Restated Thrift Plan as
amended and restated effective January 1, 1997.
5 - Undertaking to Submit the Amended and Restated Thrift Plan to
the Internal Revenue Service. See Item 9 "Undertakings."
23 - Consent of Deloitte & Touche LLP, independent auditors.
24 - Powers of Attorney.
- ---------------------------
* Incorporated herein by reference.
II-3
<PAGE>
ITEM 9. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this Registration
Statement:
(i) To include any prospectus required by section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of the Registration
Statement (or the most recent post-effective amendment thereof)
which, individually or in the aggregate, represent a
fundamental change in the information set forth in the
Registration Statement;
(iii) To include any material information with
respect to the plan of distribution not previously disclosed in
the Registration Statement or any material change to such
information in the Registration Statement;
PROVIDED, HOWEVER, that paragraphs (a)(1)(i) and (a)(1)(ii) do
not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic
reports filed by the registrant pursuant to section 13 or section
15(d) of the Securities Exchange Act of 1934 that are incorporated by
reference in the Registration Statement.
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a
post-effective amendment any of the securities being registered which
remain unsold at the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933, each
filing of the registrant's annual report pursuant to section 13(a) or section
15(d) of the Securities Exchange Act of 1934 that is incorporated by reference
in the Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under
the Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing provisions, or
otherwise, the registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
(d) The undersigned registrant hereby undertakes to submit the
Plan and any amendment thereto to the Internal Revenue Service (the "IRS") in a
timely manner and to make all changes required by the IRS in order to qualify
the Plan under Section 401 of the Internal Revenue Code.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Houston, State of Texas, on December 20, 1996.
TEJAS GAS CORPORATION
By: /S/ JAY A. PRECOURT
Jay A. Precourt
Vice Chairman of the Board,
Chief Executive Officer and
President
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities indicated on December 20, 1996.
SIGNATURE TITLE
* Chairman of the Board
Frederic C. Hamilton
/S/ JAY A. PRECOURT Vice Chairman of the Board, Chief Executive
Jay A. Precourt Officer and President (Principal Executive
Officer)
/S/ JAMES A. WHALEN Senior Executive Vice President, Chief
James W. Whalen Financial Officer and Treasurer
(Principal Financial and Accounting Officer)
* Director
Charles C. Gates
________________________ Director
Arthur L. Kelly
* Director
A. J. Miller
* Director
Robert G. Stone, Jr.
* Director
Ronald F. Walker
*By: /S/ JAMES A. WHALEN
James W. Whalen
Attorney-in-fact
II-5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
trustee of the Tejas Gas Corporation Amended and Restated Thrift Plan has duly
caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Houston, State of Texas,
on December 20, 1996.
TEJAS GAS CORPORATION THRIFT PLAN
By: /S/ CLYDE BRADFORD
Clyde Bradford
Plan Administrator
II-6
<PAGE>
EXHIBIT INDEX
Exhibit
NUMBER DOCUMENT DESCRIPTION PAGE NO.
- ------ -------------------- --------
*4.1 - Certificate of Incorporation of Tejas Gas Corporation (filed as
Exhibit 3.1 to Tejas Gas Corporation's Registration Statement
on Form S-1, Registration No. 33-24697).
*4.2 - Certificate of Amendment to Certificate of Incorporation of
Tejas Gas Corporation dated May 12, 1993 (filed as Exhibit 4.3
to Tejas Gas Corporation's Quarterly Report on Form 10-Q for
the quarter ended June 30, 1993).
*4.3 - By-laws of Tejas Gas Corporation (filed as Exhibit 3.2 to Tejas
Gas Corporation's Registration Statement on Form S-1,
Registration No. 33-24697).
*4.4 - Certificate of Designation of 9.96% Preferred Stock dated
January 26, 1993 (filed as Exhibit 2(c) to Amendment No. 1 to
Tejas Gas Corporation's Registration Statement on Form 8-A
(filed on March 25, 1993) relating to Tejas Gas Corporation's
9.96% Depositary Shares and 9.96% Preferred Stock.
*4.5 - Rights Agreement, dated as of November 11, 1994, between Tejas
Gas Corporation and Harris Trust and Savings Bank, which
includes the Certificate of Designation for the Series C Junior
Participating Preferred Stock as EXHIBIT A, the form of Right
Certificate as EXHIBIT B, and the Summary of Rights to Purchase
Preferred Shares as EXHIBIT C (filed as Exhibit 1 to Tejas Gas
Corporation's Current Report on Form 8-K dated November 11,
1994).
*4.6 - Specimen Stock Certificate for Common Stock (filed as Exhibit
4.4 to Tejas Gas Corporation's Quarterly Report on Form 10-Q
for the quarter ended June 30, 1993).
*4.7 - Specimen Stock Certificate for 9.96% Preferred Stock (filed as
Exhibit 4(e) to Tejas Gas Corporation's Registration Statement
on Form S-2, No. 33-53862).
*4.8 - Specimen Depositary Receipt representing 9.96% Depositary
Shares (filed as Exhibit 4(d) to Tejas Gas Corporation's
Registration Statement on Form S-2, No. 33-53862).
*4.9 - Deposit Agreement dated as of January 26, 1993 among Tejas Gas
Corporation, Harris Trust and Savings Bank and all holders from
time to time of depositary receipts issued thereunder (filed as
Exhibit 2(d) to Amendment No.1 to Tejas Gas Corporation's
Registration Statement on Form 8-A (filed on March 25, 1993)
relating to Tejas Gas Corporation's 9.96% Depositary Shares and
9.96% Preferred Stock).
4.10 - Tejas Gas Corporation Amended and Restated Thrift Plan as
amended and restated effective January 1, 1997.
5 - Undertaking to Submit the Amended and Restated Thrift Plan to
the Internal Revenue Service. See Item 9 "Undertakings."
23 - Consent of Deloitte & Touche LLP, independent auditors.
24 - Powers of Attorney.
- -----------------------------
* Incorporated herein by reference.
II-7
TEJAS GAS CORPORATION
THRIFT PLAN
Amendment and Restatement
January 1, 1997
i
<PAGE>
TABLE OF CONTENTS
PAGE
PREAMBLE 1
ARTICLE 1 - DEFINITIONS: INTERPRETATION 1
1.1 Account 1
1.2 Act 1
1.3 Administrative Parties 1
1.4 Age 1
1.5 Anniversary Date 1
1.6 Beneficiary 1
1.7 Board of Directors 1
1.8 Code 1
1.9 Committee 1
1.10 Company 2
1.11 Compensation 2
1.12 Covered Employee 3
1.13 Disabled or Disability 3
1.14 Discretion 3
1.15 Effective Date 3
1.16 Employee 3
1.17 Employer Group 3
1.18 Forfeiture 3
1.19 Highly Compensated Employee 3
1.20 Hour of Service 4
1.21 Investment Fund 4
1.22 Investment Manager 4
1.23 Nonforfeitable 4
1.24 Participant 4
1.25 Plan 4
1.26 Plan Year 5
1.27 Prior Plan 5
1.28 Proper 5
1.29 Qualified 5
1.30 Retire or Retirement 5
1.31 Section 415 Compensation 5
1.32 Trust and Trust Fund 5
1.33 Trustee 5
1.34 Valuation Date 6
1.35 Location of Other Definitions 6
1.36 Compliance with the Act and the Code 7
1.37 Governing Law and Rules of Construction 7
ii
<PAGE>
1.38 Power to Interpret 7
1.39 Profit Sharing Plan 7
ARTICLE 2 - PARTICIPATION 8
2.1 Participation 8
2.2 Elective Contribution Agreements 8
2.3 Participation After Termination of Employment 9
ARTICLE 3 - CONTRIBUTIONS 10
3.1 Type, Amount and Time of Contributions 10
3.2 Return of Contributions 10
ARTICLE 4 - ALLOCATIONS AND ACCOUNTS 11
4.1 Participants' Share of Contributions 11
4.2 Adjustments to Allocations of Elective Contribution Accounts 12
4.3 Adjustments to Allocations of Matching Contribution Accounts 13
4.4 Limitation on Annual Contributions 15
4.5 Periodic Adjustments to Accounts 16
4.6 Fees and Expenses 17
4.7 Separate Accounting 17
ARTICLE 5 - VESTING 17
5.1 Vesting in Elective Contribution Account 17
5.2 Vesting in Matching Contribution Account 17
5.3 Forfeiture of Nonvested Portion of Matching
Contribution Account 18
5.4 Restoration of Forfeiture Upon Reemployment 18
5.5 Years of Service 18
ARTICLE 6 - BENEFITS AND DISTRIBUTIONS 21
6.1 Distribution on Termination of Employment 21
6.2 Distribution Upon Attainment of Age 59-1/2 21
6.3 Distribution on Account of Hardship 22
6.4 Payment of Benefits on Termination of
Employment Other Than Death 23
6.5 Payment of Benefits Upon Death 24
6.6 Medium of Distribution 26
6.7 Restrictions on Company Securities 26
6.8 Benefit Recipients 26
6.9 Distribution of Excess Deferrals 26
iii
<PAGE>
6.10 Loans to Participants 27
ARTICLE 7 - SPECIAL EMPLOYMENT PROVISIONS 28
ARTICLE 8 - TOP HEAVY REQUIREMENTS 29
8.1 Applicability 29
8.2 Determination of Top Heavy Status 29
8.3 Top Heavy Definitions 31
8.4 Top Heavy Restrictions 32
ARTICLE 9 - INVESTMENT FUNDS, TRUSTEE AND TRUST AGREEMENT 34
9.1 Investment Funds 34
9.2 The Trustee 35
9.3 Form and Terms of the Trust Agreement 35
9.4 Fiduciaries and Named Fiduciaries 35
9.5 Bonding 36
9.6 Fiduciary of Trust Fund 36
9.7 Transfer of Investment Authority 36
9.8 Funding Policy 37
9.9 Voting of Securities 37
ARTICLE 10 - PLAN ADMINISTRATION 37
10.1 Composition of Committee 37
10.2 Plan Administrator 37
10.3 Removal and Resignation 37
10.4 Quorum 37
10.5 Officers 38
10.6 Designated Administrator 38
10.7 Duties of Company 38
10.8 Duties of Committee 38
10.9 Claims Procedure 39
10.10 Powers 40
10.11 Discretion; Nondiscrimination 41
10.12 No Separate Committee 41
10.13 Unclaimed Benefits 41
ARTICLE 11 - TERMINATION AND AMENDMENT 41
11.1 Termination of Plan 41
11.2 Termination of Trust 42
11.3 Amendment 42
ARTICLE 12 - TRANSFERRED ASSETS AND ROLLOVER CONTRIBUTIONS 42
iv
<PAGE>
12.1 Right to Transfer Assets to this Plan 42
12.2 Right to Make Rollover Contributions to the Plan 44
12.3 Transfers to Other Qualified Plans 44
ARTICLE 13 - MISCELLANEOUS 45
13.1 No Reversion 45
13.2 Merger, Consolidation, Etc. 46
13.3 Limitations on Assignment 46
13.4 Execution of Instruments 46
13.5 Company Actions 46
13.6 Successors, Etc. 47
13.7 Miscellaneous Protective Provisions 47
13.8 More Than One Company 47
13.9 Indemnification by the Company 48
13.10 Employment Rights Not Enlarged 48
13.11 Notification of Address 48
ARTICLE 14 - EXECUTION 48
APPENDIX A - LEDCO TRANSFERRED ASSET ACCOUNT 49
v
<PAGE>
PREAMBLE
This Plan is adopted on the date of its execution as an amendment and
restatement of the Tejas Gas Corporation Thrift Plan, originally effective
January 1, 1989. This Amendment and Restatement is effective as indicated in
section 1.16 (Effective Date). Notwithstanding any provision of this Plan to the
contrary, contributions, benefits and service credit with respect to qualified
military service will be provided in accordance with section 414(u) of the Code.
ARTICLE 1
DEFINITIONS: INTERPRETATION
The words and phrases described in sections 1.1 through 1.35, wherever
capitalized, shall have the respective meanings given them in such sections,
unless the context otherwise requires, and the rules of construction contained
in sections 1.36 through 1.39 shall guide interpretation.
1.1 ACCOUNT shall mean one or more Accounts maintained to record the interest of
a Participant in the Plan. Possible Accounts are the Elective Contribution
Account, the Matching Contribution Account, the Transferred Matching Account,
the Rollover Contribution Account, and the Post-tax Contribution Account, as
those terms are hereinafter defined, and such other Accounts as the Committee
establishes pursuant to section 12.1 (Right to Transfer Assets to this Plan).
1.2 ACT means those provisions of the Employee Retirement Income Security Act of
1974, as amended, which are not included within the Code, as heretofore or
hereafter amended or supplemented, or as superseded by laws of similar effect.
1.3 ADMINISTRATIVE PARTIES means and includes Tejas Gas Corporation, the Trustee
and the Committee.
1.4 AGE means a Participant's chronological age (not his age on his nearest
birthday).
1.5 ANNIVERSARY DATE means each December 31 commencing after the Effective Date.
1.6 BENEFICIARY means a person or persons so determined pursuant to section
6.5(c) (Designation of Beneficiary).
1.7 BOARD OF DIRECTORS means the Board of Directors of Tejas Gas Corporation.
1.8 CODE means the Internal Revenue Code of 1986, as heretofore or hereafter
amended or supplemented, or as superseded by laws of similar effect.
1
<PAGE>
1.9 COMMITTEE means the administrative committee appointed pursuant to section
10.1 (Composition of Committee) to administer the Plan.
1.10 COMPANY means:
(a) Tejas Gas Corporation, a Delaware Corporation;
(b) Tejas Gas Corp., a Nevada corporation;
(c) On or after February 1, 1991, Acadian Gas Pipeline System, a Texas
partnership;
(d) On or after June 6, 1996, Transok, Inc., an Oklahoma corporation; and
(e) Such other members of the Employer Group which, with the approval of
the Board of Directors, adopt the Plan by resolution of their board of
directors.
1.11 COMPENSATION means base salary and bonus paid to a Participant during a
Plan Year by the Company as remuneration for services rendered, but excluding
overtime, premium pay and noncash payments, modified as described in (a)-(e) of
this paragraph:
(a) Compensation shall be increased by amounts contributed by a Company
pursuant to a salary reduction agreement which are excludable from the
Employee's gross income in the calendar year under a cafeteria plan under
section 125 of the Code, a cash or deferred arrangement by section 402(a)(8) of
the Code, or a simplified employee pension by section 402(h) of the Code.
(b) Compensation shall not include severance payments or salary
continuation arrangements or any other amounts paid after the employment
relationship is terminated, reimbursement for expenses, stock incentives, and
similar items.
(c) The annual compensation of each Participant taken into account for
determining all benefits provided under the Plan for any Plan Year shall not
exceed $150,000, adjusted for increases in the cost-of-living in accordance with
section 401(a)(17)(B) of the Code. The cost-of-living adjustment in effect for a
calendar year applies to any determination period beginning in such calendar
year.
(d) If a determination period consists of fewer than 12 months, the annual
compensation limit is an amount equal to the otherwise applicable annual
compensation limit multiplied by a fraction, the numerator of which is the
number of months in the short determination period, and the denominator of which
is 12.
(e) Where Compensation is limited by (c) or (d) above, bonus will be
considered reduced before base salary.
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1.12 COVERED EMPLOYEE means any Employee who is not laid off, on leave of
absence or on active duty in the armed forces of any nation or international
body (other than as a member of the inactive reserve of the Armed Forces of the
United States of America).
1.13 DISABLED OR DISABILITY means an injury or sickness other than chemical
dependency which causes the Employee's termination of employment with the
Company. The existence of a Disability will be determined by the Committee in
its Discretion.
1.14 DISCRETION means the authority to make decisions in a nondiscriminatory
manner.
1.15 EFFECTIVE DATE means January 1, 1989. The effective date of this amendment
and restatement is January 1, 1997, although certain provisions may have a later
effective date as noted in the text.
1.16 EMPLOYEE means any individual who receives Compensation from the Company
other than an independent contractor and other than a leased employee within the
meaning of section 414(n)(2) of the Code. In addition, an Employee whom an
Employer transfers to employment with Coral Energy Resources Services Company or
Coral Energy, L.P. shall not be considered to have terminated employment during
such employment for purposes of receiving a distribution under Article 6,
accrual of vesting service under section 5.5 (Years of Service), taking out
loans under Section 6.10 (provided repayment is arranged through payroll
deduction by Coral Energy Resources Services Company), and making hardship
withdrawals under Section 6.3. However, Employees shall not be considered to
receive Compensation for service as an employee of Coral Energy Resources
Services Company or Coral Energy, L.P.
1.17 EMPLOYER GROUP means the Company and any subsidiary or affiliated entity
which, with the Company, constitutes a controlled group of corporations or other
entities, or an affiliated service group within the meaning of subsections (b),
(c), (m) or (o) of section 414 of the Code.
1.18 FORFEITURE means nonvested amounts which are forfeited from an employee's
Matching Contribution Account and Transferred Matching Account pursuant to
sections 4.2(d) (Distribution of Excess Contributions), section 4.3 (Adjustment
of Allocations to Matching Contribution Accounts) and 5.3 (Forfeiture of
Nonvested Portion of Matching Contribution Account).
1.19 HIGHLY-COMPENSATED EMPLOYEE means any Employee who:
(a) was a five-percent owner (as defined in section 416(i)(1) of the Code)
at any time during the year or the preceding year, or
(b) for the preceding year had Section 415 Compensation from the Company
in excess of $80,000 (as adjusted pursuant to section 415(d) of the Code, except
that the base
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period is the calendar quarter ending September 30, 1996), and, if Tejas Gas
Corporation elects for such preceding calendar year, was in the top-paid group
of employees for such preceding year. An Employee is in the top-paid group or
employees for any year if such Employee is in the group consisting of the top 20
percent of employees in the Employer Group when ranked on the basis of Section
415 Compensation paid during such year. For purposes of this paragraph, Section
415 Compensation will be increased for 1997 by amounts contributed by the
Company pursuant to a salary reduction agreement which are excludable from the
Employee's gross income under Sections 125, 402(a)(8), 402(h) or 403(b) of the
Code.
(c) The determination of who is a Highly-Compensated Employee, including
the determinations of the number and identity of employees in the top-paid group
and the compensation that is considered, will be made in accordance with section
414(q) of the Code and the regulations thereunder.
1.20 HOUR OF SERVICE means each hour for which an Employee is directly or
indirectly paid, or entitled to payment, by the Company and, where not specified
otherwise, by a member of the Employer Group.
1.21 INVESTMENT FUND shall mean one or more funds, comprising the Trust Fund, in
which Plan assets may be invested pursuant to section 9.1 (Investment Funds).
1.22 INVESTMENT MANAGER means a person, firm or entity which:
(a) is either (i) registered as an investment adviser under the Investment
Advisers Act of 1940, (ii) a bank, as defined in the Investment Advisers Act of
1940, or (iii) an insurance company qualified to manage, acquire and dispose of
the assets of Qualified plans under the laws of more than one state,
(b) has acknowledged in writing that it is a fiduciary with respect to the
Plan, and
(c) has been granted the authority and duty to direct the investment of
all or part of the Trust Fund pursuant to section 9.7 (Transfer of Investment
Authority).
1.23 NONFORFEITABLE, when used with respect to a benefit, right or Account under
this Plan, means vested and unconditional in accordance with sections 5.1
(Vesting in Elective Contribution Account) and 5.2 (Vesting in Matching
Contribution Account).
1.24 PARTICIPANT means an individual who participates in the Plan in accordance
with Article 2 (Participation).
1.25 PLAN means the Tejas Gas Corporation Thrift Plan, as herein set forth or as
from time to time amended.
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1.26 PLAN YEAR means the period beginning on each January 1, and ending on the
following December 31 on and after the Effective Date.
1.27 PRIOR PLAN means:
(a) The portion of the Hamilton Brothers Oil Company Thrift Plan which was
adopted by Tejas Gas Corp. for the benefit of its employees as in force and
effect for the period prior to the Effective Date;
(b) Acadian Gas Pipeline System Capital Accumulation Plan in force and
effect for the period prior to February 1, 1991; and
(c) LEDCO, Inc. 401(k) Profit Sharing Plan in force and effect for the
period prior to July 1, 1995.
The Prior Plans were merged into this Plan in accordance with Article 12
(Transferred Assets and Rollover Contributions).
1.28 PROPER means necessary, advisable, desirable, expedient or convenient.
1.29 QUALIFIED, where used with reference to a plan or trust, has the same
meaning as in section 401(a) of the Code, and when used with reference to an
annuity plan, means a plan which meets the requirements of section 403(a) of the
Code.
1.30 RETIRE OR RETIREMENT means termination of employment at or after age 65.
1.31 SECTION 415 COMPENSATION means, for purposes of sections 1.19 (Definition
of Highly- Compensated Employee) and 4.4 (Limitation on Annual Contributions)
and Article 8 (Top Heavy Requirements), wages paid by the Company or a member of
the Employer Group as defined in section 3401(a) of the Code for purposes of
income tax withholding at the source. However, such wages shall be determined
without regard to any rules that limit the remuneration included in wages based
on the nature or location of the employment or the service performed. For
purposes of Article 8 (Top-Heavy Requirements) only, Section 415 Compensation is
limited by Section 401(a)(17) of the Code. Effective January 1, 1998, Section
415 Compensation shall be increased by amounts contributed by the Employer Group
pursuant to a salary reduction agreement which are excludable from the
Employee's gross income under Sections 125, 402(a)(8), 402(h) or 403(b) of the
Code.
1.32 TRUST AND TRUST FUND mean the trust and trust fund established pursuant to
the Plan as a medium for funding the Plan.
1.33 TRUSTEE means the individuals, bank(s), trust companies, or insurance
companies, or any combination thereof, as may be designated as Trustee by Tejas
Gas Corporation, from time to time.
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1.34 VALUATION DATE means any date on which the United States financial markets
are open. In addition, "Valuation Date" means any other date designated by the
Committee in its Discretion.
1.35 LOCATION OF OTHER DEFINITIONS. Definitions of the following words and
phrases are contained in the following provisions, respectively:
ACP 4.3(a)
ADP 4.2(a)
Company Common Stock 3.1(b)
Company Common Stock Fund 9.1(a)
Contribution Percentage Amounts 4.3(e)(iv)
Designated Administrator 10.6
Determination Date 8.3(a)
Direct Rollover 12.3(b)(iv)
Distributee 12.3(b)(iii)
Distribution on Account of Hardship 6.3(c)
Elective Contribution 3.1(a)
Elective Contribution Account 4.2(b)(i)
Elective Contribution Agreement 2.2(a)
Eligible Retirement Plan 12.3(b)(ii)
Eligible Rollover Distribution 12.3(b)(i)
Employment Commencement Date 5.5(d)(i)
Excess Contributions 4.2(f)
Excess Aggregate Contributions 4.3(e)
General Consent 6.5(b)
Hardship 6.3(b)
Key Employee 8.3(b)
Loan Procedure 6.10(a)
Matching Contribution 3.1(b)
Matching Contribution Account 4.1(b)
Minimum Contribution 8.4(a)(i)
Non-Key Employee 8.3(c)
One-Year Period of Severance 5.5(d)(iii)
Period of Severance 5.5(d)(v)
Period of Service 5.5(d)(vi)
Plan Administrator 10.2
Post-Tax Contribution Account 12.(d)
Reemployment Commencement Date 5.5(d)(iv)
Rollover Contribution 12.2
Rollover Contribution Account 12.2
Severance from Service Date 5.5(d)(ii)
Spousal Consent 6.5(b)
Super Top Heavy 8.3(d)
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Suspense Account 4.4(b)(iv)
Top Heavy 8.2
Transferred Assets 12.1
Transferred Matching Account 12.1(c)
1.36 COMPLIANCE WITH THE ACT AND THE CODE. This Plan shall be interpreted and
effectuated to comply with the applicable requirements of the Act and the Code.
1.37 GOVERNING LAW AND RULES OF CONSTRUCTION. This Plan shall be governed in all
respects, whether as to construction, capacity, validity, performance or
otherwise, by the laws of the United States and, to the extent not superseded by
the laws of the United States, by the laws of the State of Texas. Wherever
reasonably necessary, pronouns of any gender shall be deemed synonymous, as
shall singular and plural pronouns. The index to the Plan and the headings to
the Articles and sections of the Plan are included solely for convenience and
shall in no event affect, or be used in connection with, the interpretation of
the Plan. Each provision of the Plan shall be treated as severable, to the end
that, if any one or more provisions shall be adjudged or declared illegal,
invalid or unenforceable, the Plan shall be interpreted, and shall remain in
full force and effect, as though such provision or provisions had never been
contained in this Plan.
1.38 POWER TO INTERPRET. Subject to section 1.36 (Compliance with the Act and
the Code), the Committee shall have power to construe this Plan, to correct any
defect, supply any omission, or reconcile any inconsistencies in such manner and
to such extent as the Committee shall deem Proper to carry the Plan into effect.
1.39 PROFIT SHARING PLAN. This Plan is intended to be a profit sharing plan and,
specifically, not a plan to which section 412 of the Code applies.
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ARTICLE 2
PARTICIPATION
2.1 PARTICIPATION. Each Covered Employee shall become a Participant as follows:
(a) Participants in the Hamilton Brothers Oil Company Thrift Plan on
December 26, 1988 shall automatically become Plan Participants on January 1,
1989 if they are Covered Employees on that date.
(b) Participants in the Acadian Gas Pipeline System Capital Accumulation
Plan on January 31, 1991 shall automatically become Plan Participants on
February 1, 1991 if they are Covered Employees on that date.
(c) Employees who were employed by Enserch Corporation and who became
employed by the Company between December 1, 1991 and January 2, 1992, shall
become Participants on January 1, 1992, provided they are Covered Employees on
that date.
(d) Employees who are employed by Cypress Gas Pipeline Company (formerly
Monterey Pipeline Corporation), or STHC Pipeline Company or Tejas Gas Pipeline
Company (formerly Exxon Gas System, Inc.) on September 16, 1993, shall become
Participants on that date.
(e) Employees who were employed by East Texas Industrial Gas Company on
October 12, 1993, and who became Covered Employees on October 16, 1993, shall
become Participants on October 16, 1993.
(f) Employees who were employed by LEDCO, Inc. on February 10, 1995, and
who became employed by the Company on February 13, 1995, shall become
Participants on that date.
(g) Employees who are employed by Transok, Inc., on June 6, 1996, shall
become Participants on June 6, 1996.
(h) All other Employees shall become Participants on the first day of the
month next following their completion of one Hour of Service with the Company,
provided they are Covered Employees on that date.
2.2 ELECTIVE CONTRIBUTION AGREEMENTS.
(a) IN GENERAL. A Participant shall not be entitled to receive an
allocation of Elective Contributions unless and until he or she shall have filed
with the Committee an Elective Contribution Agreement. "Elective Contribution
Agreement" means the document by which a Participant elects to reduce his
Compensation by a designated amount and have that amount contributed to the
Plan.
(b) EXECUTION AND REVOCATION. A Participant's Elective Contribution
Agreement
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may be executed at any time. Such agreement shall be effective on the date the
Employee becomes a Participant, if made before that date. Otherwise, it will
become effective on the first of the month after it is made and the agreement
processed. An Elective Contribution Agreement shall remain in effect until the
Participant cancels or changes it. A Participant may change the amount of his
Elective Contribution no more frequently than once a month. A Participant may
cancel Elective Contributions effective as soon as administratively practicable.
A Participant may make, change or cancel an Elective Contribution Agreement in
accordance with the Committee's rules and procedures in effect at the time. The
Committee may add or delete dates on which such elections may be made and may
alter the effective dates for those elections in its sole Discretion. However,
the Elective Contribution Agreement shall be executed prior to the beginning of
the pay period for which it is to be effective.
(c) LIMITS ON ELECTION. Elections to reduce the portion of Compensation
which is base salary may be made in one percent (1%) increments up to a maximum
of fifteen percent (15%) of base salary. Elections to reduce the portion of
Compensation which is bonus may equal sixty percent (60%) or one hundred percent
(100%) of the bonus before adjustment for interim earnings and withholding.
However, all Elective Contributions in a Plan Year shall not exceed $7,000,
adjusted for cost-of-living by the Secretary of the Treasury pursuant to Section
402(g)(5) of the Code, and shall not exceed the limitations on annual
contributions under section 4.4. The Company may reduce elections so that such
limits are not exceeded. An Elective Contribution shall be deemed made in a
calendar year to the extent it is not includable in the Employee's gross income
for the calendar year.
2.3 PARTICIPATION AFTER TERMINATION OF EMPLOYMENT.
(a) DURATION OF PARTICIPATION. A Covered Employee who becomes a
Participant shall continue to be a Participant until the date on which he or she
ceases to be a Covered Employee and thereafter until the date on which he or she
ceases to have a Nonforfeitable interest in his or her Account; provided,
however, that a Participant who is not a Covered Employee shall not be entitled
to make Elective Contributions.
(b) PARTICIPATION AFTER REEMPLOYMENT. A former Participant who is
reemployed by the Company shall be eligible to again become a Participant in the
Plan as of the first day of the month next following his or her completion of
one Hour of Service as a Covered Employee of the Company.
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ARTICLE 3
CONTRIBUTIONS
3.1 TYPE, AMOUNT AND TIME OF CONTRIBUTIONS.
(a) ELECTIVE CONTRIBUTIONS. The Company shall contribute for any Plan Year
an amount equal to the amount by which the Participant has reduced his or her
Compensation pursuant to an Elective Contribution Agreement ("Elective
Contribution"). All Elective Contributions shall be made to the Trust for a Plan
Year as soon as reasonably possible following the date the Participant's
Compensation is reduced with respect to the Elective Contribution and in no
event later than the due date for filing the Company's federal income tax
return, plus extensions, for the Company's taxable year ending with or within
the Plan Year for which the Elective Contributions are made.
(b) MATCHING CONTRIBUTIONS. The Company shall contribute on behalf of each
Participant who makes an Elective Contribution a matching contribution for the
Plan Year equal to the Participant's Elective Contribution for the Plan Year,
but not to exceed three percent (3%) of the portion of the Participant's
Compensation which is base salary ("Matching Contribution"). The Company may
make Matching Contributions either in Tejas Gas Corporation common stock
("Company Common Stock") or in cash. However, Matching Contributions made for a
Plan Year may be adjusted to reflect the fact that Matching Contributions are
not made for certain Participants as provided in section 4.1(b) (Allocation of
Matching Contributions) such that Matching Contributions for a Plan Year shall
not exceed allocations for a Plan Year under section 4.1(b). All Matching
Contributions, if any, for a Plan Year shall be made to the Trust not later than
the due date for filing the Company's federal income tax return, plus
extensions, for the Company's taxable year ending with or within the Plan Year
for which the Company contributions are made.
(c) TRANSFERRED ASSETS AND ROLLOVER CONTRIBUTIONS. Rules respecting
Transferred Assets and Rollover Contributions are described in Article 12
(Transferred Assets and Rollover Contributions).
3.2 RETURN OF CONTRIBUTIONS. In no event shall the Company receive any amounts
from the Trust except such amounts, if any, as set forth below:
(a) MISTAKE OF FACT. In the event of a contribution made by the Company on
a mistake of fact, such contribution shall be returned to the Company within one
year after payment thereof.
(b) QUALIFICATION. If the determination letter issued by the District
Director of the Internal Revenue Service with respect to the Plan is an initial
determination letter and is to the effect that the Plan and Trust herein set
forth do not meet the requirements of sections 401(a) and 501(a) of the Code,
the Company shall withdraw, within one year of the date of issuance of such
letter, all of its contributions made on and after the Effective, Date, as
though it had never adopted this Plan and Trust.
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(c) DEDUCTIBILITY. Each contribution hereunder is conditioned upon the
deductibility of such contribution under section 404 of the Code and shall be
returned to the Company no later than one year from the date a deduction of the
contribution is disallowed (to the extent of the disallowance).
ARTICLE 4
ALLOCATIONS AND ACCOUNTS
4.1 PARTICIPANTS' SHARE OF CONTRIBUTIONS.
(a) ALLOCATION OF ELECTIVE CONTRIBUTIONS. The Committee shall establish an
Elective Contribution Account to receive Elective Contributions for each
Participant who completes an Elective Contribution Agreement and shall
thereafter maintain records thereof. Such Participant's Elective Contributions
shall be allocated to his Elective Contribution Account as soon as practicable
after such contributions are received by the Trust except where Elective
Contributions are made to the Trust for the preceding Plan Year, in which case
such contributions shall be allocated to the Participant's Elective Contribution
Account as of the last day of such preceding Plan Year.
(b) ALLOCATION OF MATCHING CONTRIBUTIONS. The Committee shall establish a
Matching Contribution Account for each Participant to receive Matching
Contributions and thereafter maintain records thereof. Matching Contributions
shall be allocated to the Matching Contribution Account of each Participant who
makes Elective Contributions for the Plan Year for which the contribution is
made, provided such Participant has not been discharged for cause, or has not
voluntarily terminated employment with the Employer Group prior to the last day
of the Plan Year for reasons other than (i) Retirement, (ii) early retirement
after attaining age 55 and completing five Years of Service while in good
standing as determined by the Company in a nondiscriminatory manner, (iii)
death, or (iv) Disability. Matching Contributions shall be allocated to each
eligible Participant's Matching Contribution Account as of the last day of the
Plan Year for which such contribution is made.
(c) ALLOCATION OF TRANSFERRED ASSETS AND ROLLOVER CONTRIBUTIONS. Assets
transferred pursuant to Article 12 (Transferred Assets and Rollover
Contributions) shall be allocated to a Participant's Elective Contribution
Account, Transferred Matching Account, Post-Tax Contribution Account, Rollover
Contribution Account or other account, as provided in Article 12, as soon as
practicable after the date the Transferred Assets are received by the Trustee.
(d) ALLOCATION OF FORFEITURES. Any amounts forfeited by any Participant
during the Plan Year from his Matching Contribution Account and Transferred
Matching Account pursuant to sections 4.2(d) (Distribution of Excess
Contributions), 4.3 (Adjustment of Allocations to Matching Contribution
Accounts) and 5.3 (Forfeiture of Nonvested Portion of Matching Contribution
Account) shall be used first to restore Forfeited amounts pursuant to sections
5.4 (Repayment of Distribution on Reemployment) and 10.13 (Unclaimed Benefits);
and second to reduce the Company's Matching Contributions under section 3.2
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(Matching Contributions) to the extent of such contributions.
4.2 ADJUSTMENT OF ALLOCATIONS TO ELECTIVE CONTRIBUTION ACCOUNTS.
(a) LIMITS. The allocations for a Plan Year to the Elective Contribution
Accounts of Participants who are Highly-Compensated Employees shall be limited
as provided in section 401(k)(3) of the Code, Treasury Regulation section
1.401(k)-1(b), section 401(m)(9) of the Code, and Treasury Regulation section
1.401(m)-2, which are incorporated herein by reference. These sections prohibit
the average Elective Contributions of Highly-Compensated Employees, when
expressed as a percentage of compensation as defined in section 414(s) of the
Code (the "ADP"), from exceeding: (i) 1.25 times such average for other
Participants, or (ii) two times such average for other Participants, where the
difference between the averages does not exceed two percentage points.
(b) REDUCTION OF ELECTIVE CONTRIBUTIONS. If the Administrator determines
prior to the end of the Plan Year that the limit described in subsection 5.2(a)
will be exceeded for the Plan Year, then the Administrator will require that the
amount of Elective Contributions that may be remitted to the Plan on behalf of
Highly-Compensated Employees be proportionately reduced to the extent necessary
to ensure that one of the discrimination tests set forth in subsection 4.2(a) is
satisfied. In the event that excess Elective Contributions have not been
remitted by the Employer to the Trust, the Employer will return such
contributions to the Participant as additional cash remuneration to the extent
necessary to meet the discrimination tests.
(c) DISTRIBUTION OF EXCESS CONTRIBUTIONS. Notwithstanding any other
provision of this Plan, Excess Contributions, plus any income and minus any loss
allocable thereto as described in subsection (f) below, shall be distributed no
later than the last day of each Plan Year to Participants to whose accounts such
Excess Contributions were allocated for the preceding Plan Year. Such
distribution will be made to Highly-Compensated Employees on the basis of the
amount of contributions by, or on behalf of, each of such employees. Excess
Contributions shall be treated as contributions for purposes of section 4.4
(Limitations on Annual Contributions), even though they are distributed.
Matching Contributions made with respect to Excess Contributions shall be
forfeited, whether or not Nonforfeitable, and shall not be taken into account in
determining the limits on Matching Contributions imposed by subsection 4.3(a).
(d) ACCOUNTING FOR EXCESS CONTRIBUTIONS. Excess Contributions shall be
distributed from the Participant's Elective Contribution Account in proportion
to the Participant's Elective Contributions.
(e) DEFINITION OF EXCESS CONTRIBUTIONS. "Excess Contributions" means, with
respect to any Plan Year, the excess of:
(i) the aggregate amount of Company contributions actually taken
into account in computing the ADP of Highly-Compensated
Employees for such Plan Year, over
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(ii) the maximum amount of such contributions permitted by the ADP
test (determined by reducing contributions made on behalf of
Highly- Compensated Employees in order of the ADP's, beginning
with the highest of such percentages).
(f) DETERMINATION OF INCOME OR LOSS. Excess Contributions shall be
adjusted for any income or loss up to the end of the Plan Year in which made.
The income or loss allocable to Excess Contributions is the income or loss
allocable to the Participant's Elective Contribution Account for the Plan Year
multiplied by a fraction, the numerator of which is such Participant's Excess
Contributions with respect to the ADP test for the year and the denominator is
the Participant's Elective Contribution Account without regard to any income or
loss occurring during such Plan Year.
4.3 ADJUSTMENT OF ALLOCATIONS TO MATCHING CONTRIBUTION ACCOUNTS.
(a) LIMITS. The allocations for a Plan Year to the Matching Contribution
Accounts of Participants who are Highly-Compensated Employees shall be limited
as provided in section 401(m)(2) of the Code, Treasury Regulation section
1.401(m)-1(b), section 401(m)(9) of the Code, and Treasury Regulation section
1.401(m)-2, which are incorporated herein by reference. These sections prohibit
the average Matching Contributions of Highly-Compensated Employees, when
expressed as a percentage of compensation as defined in section 414(s) of the
Code (the "ACP"), from exceeding: (i) 1.25 times such average for other
Participants, or (ii) two times such average for other Participants, where the
difference between the averages does not exceed two percentage points.
(b) FORFEITURE OR DISTRIBUTION OF EXCESS AGGREGATE CONTRIBUTIONS.
Notwithstanding any other provision of the Plan, Excess Aggregate Contributions,
plus any income and minus any loss allocable thereto as described in subsection
(e) below, shall be forfeited, if forfeitable, or if not forfeitable,
distributed no later than the last day of each Plan Year to Participants to
whose accounts such Excess Aggregate Contributions were allocated for the
preceding Plan Year. Such forfeiture or distribution will be made to
Highly-Compensated Employees on the basis of the amount of contributions on
behalf of, or by, each such employee. Excess Aggregate Contributions shall be
treated as contributions for purposes of section 4.4 (Limitations on Annual
Contributions), even though they are forfeited or distributed. Forfeitures of
Excess Aggregate Contributions shall be applied to reduce Employer
contributions.
(c) ACCOUNTING FOR EXCESS AGGREGATE CONTRIBUTIONS. Excess Aggregate
Contributions shall be forfeited, if forfeitable, or distributed on a pro-rata
basis from the Participant's Matching Contribution Account and, if applicable,
the Participant's Elective Contribution Account.
(d) DEFINITION OF EXCESS AGGREGATE CONTRIBUTIONS. "Excess Aggregate
Contributions" means, with respect to any Plan Year, the excess of:
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(i) the aggregate Contribution Percentage Amounts actually taken
into account in computing the numerator of the Contribution
Percentage of Highly- Compensated Employees for such Plan
Year, over
(ii) the maximum Contribution Percentage Amounts permitted by the
ACP test (determined by reducing contributions made on behalf
of Highly- Compensated Employees in order of their
Contribution Percentages, beginning with the highest of such
percentages).
(iii) For purposes of this subsection, "Contribution Percentage"
means the ratio (expressed as a percentage) of the
Participant's Contribution Percentage Amounts to the
Participant's compensation as defined in section 414(s) of the
Code.
(iv) For purposes of this subsection, "Contribution Percentage
Amounts" means the Matching Contributions plus Elective
Contributions to the extent not taken into account for
purposes of the ADP test made on behalf of the Participant for
the Plan Year. Such Contribution Percentage Amounts shall not
include Matching Contributions that are forfeited either to
correct Excess Aggregate Contributions or because the
contributions to which they relate are Excess Contributions or
Excess Aggregate Contributions. The Employer may use Elective
Contributions in the Contribution Percentage Amounts so long
as the ADP test is met before the Elective Contributions are
used in the ACP test and continues to be met following the
exclusion of those Elective Contributions that are used to
meet the ACP test.
(e) DETERMINATION OF INCOME OR LOSS. Excess Aggregate Contributions shall
be adjusted for any income or loss up to the end of the Plan Year in which made.
The income or loss allocable to Excess Aggregate Contributions is the sum of the
income or loss allocated to the Participant's Matching Contribution Account, and
Elective Contribution Account to the extent such amounts are used in the ACP
test, for the Plan Year multiplied by a fraction, the numerator of which is such
Participant's Excess Aggregate Contributions for the year and the denominator is
the Participant's account balances attributable to Contribution Percentage
Amounts without regard to any income or loss occurring during such Plan Year.
(f) MULTIPLE USE. If the sum of the ADP (defined in section 4.2(a)) and
the ACP (defined in section 4.3(a)) of those Highly-Compensated Employees who
both make Elective Contributions and receive a Matching Contribution exceeds the
Aggregate Limit (determined as provided in Treas. Reg. section 1.401(m)-2), then
the ACP of such Highly-Compensated Employees will be reduced (beginning with
such Highly-Compensated Employee whose ACP is the highest) so that the limit is
not exceeded. The amount by which each Highly-Compensated Employee's Matching
Contribution is reduced shall be treated as an Excess Aggregate Contribution and
forfeited or distributed as provided in Paragraph (b) above. The ADP and ACP of
the Highly-Compensated Employees are
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determined for purposes of the multiple use test after any corrections required
to meet the ADP and the ACP tests without regard to this paragraph (f). Multiple
use does not occur if either the ADP or the ACP of Highly-Compensated Employees
does not exceed 1.25 multiplied by the ADP or the ACP of Employees who are not
Highly-Compensated Employees.
4.4 LIMITATION ON ANNUAL CONTRIBUTIONS.
(a) IN GENERAL. Notwithstanding anything in this Plan to the contrary, the
sum of Elective Contributions and Matching Contributions allocated to the
Accounts of a Participant may not exceed the lesser of:
(i) $30,000, indexed as provided in section 415(c)(1)(A) of the Code; or
(ii) 25 percent of the Participant's Section 415 Compensation.
In determining this limit, the provisions of section 415 of the Code, which is
hereby incorporated by reference, apply in accordance with Subsections (b), (c),
and (d) below.
(b) ACTIONS TO BE TAKEN TO AVOID EXCEEDING LIMIT.
(i) If, as a result of the allocation of forfeitures, a reasonable error
in estimating a Participant's Section 415 Compensation, a reasonable
error in determining the amount of Elective Contributions that may
be made with respect to any individual under the limits of section
415 of the Code, or under other limited facts and circumstances that
the Commissioner of Internal Revenue may determine, the limitation
set forth in section 4.4(a) would otherwise be exceeded with respect
to a Participant in a Plan Year, then the Trustee shall act as
provided in subsections (ii), (iii), (iv), (v) in the order set
forth.
(ii) If any of the excess is permitted to be refunded to the Company
pursuant to section 3.2 (Return of Contributions), the Trustee shall
refund this portion of the excess.
(iii) Unmatched Elective Contributions shall be returned to the
Participant to the extent the return would reduce the excess. These
amounts shall be disregarded for purposes of the limits on Elective
Contributions under sections 2.2(c) (Limits on Election), 4.2
(Adjustment of Allocations to Elective Contribution Accounts), and
4.3 (Adjustment of Allocations to Matching Contribution Accounts).
(iv) The remaining excess amount, determined first by reference to
Matching Contributions, and then to Elective Contributions, shall be
held unallocated in a separate account (the "Suspense Account").
Investment gains and losses and other income shall be credited to
the Suspense Account. If the Participant is an Employee at the end
of the Plan Year next following the
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Plan Year with respect to which the limit set forth in section
4.4(a) would otherwise be exceeded, the amount in the Suspense
Account shall be used to reduce the appropriate contributions for
such Participant for that next Plan Year, and for succeeding Plan
Years, as necessary to exhaust the Suspense Account, if he or she is
an Employee at the end of such succeeding Plan Year. If the
Participant is not an Employee at the end of such succeeding Plan
Year, the amount in the Suspense Account shall be allocated and
reallocated in that next Plan Year (and succeeding Plan Years), as
necessary to exhaust the Suspense Account, to the appropriate
Accounts of the remaining Participants, as provided in section 4.1
(Participants' Share of Contributions) to the extent of the
contributions to be allocated before the Company may make such
contributions to the Plan for such next following Plan Year (or such
succeeding Plan Years).
(v) Upon the termination of the Plan as provided in section 11.1
(Termination of Plan), any amounts in the Suspense Account on the
date of such termination shall be allocated and reallocated as
provided in the proceeding sentence and any excess shall be returned
to the Company.
(c) PARTICIPANT IN ANOTHER DEFINED CONTRIBUTION PLAN. If a Participant
also participates in a defined contribution plan (within the meaning of section
415(k) of the Code), other than the Plan, maintained by any Employer Group (as
modified by section 415(h)), and the limitations set forth in section 415 of the
Code would otherwise be exceeded, the amount to be allocated to such
Participant's account under such other defined contribution plan shall, to the
extent permitted under such other plan, be reduced to eliminate such excess
prior to making any reduction pursuant to sections 4.4(b) and (d).
(d) PARTICIPATION IN A DEFINED BENEFIT PLAN. If the Participant also
participates in a defined benefit plan (within the meaning of section 415(k) of
the Code) maintained by any Employer Group (as modified by section 415(h)), and
the limitations set forth in section 415(e) of the Code would otherwise be
exceeded, the benefit provided under the defined benefit plan shall, to the
extent permitted under such other plan, be reduced to eliminate such excess
prior to making any reduction pursuant to section 4.4(b).
4.5 PERIODIC ADJUSTMENTS TO ACCOUNTS. Adjustments shall be made from time to
time to each Participant's Account as follows:
(a) FOR DISTRIBUTIONS. The Committee shall direct the Trustee to debit
each Account currently in respect of any distributions of benefits therefrom.
(b) FOR PROFITS AND LOSSES. A Participants Accounts shall be valued at
fair market value on each Valuation Date. In determining fair market value of a
Participant's Accounts, the Committee shall instruct the Trustee to use such
method of accounting as the Committee shall determine in its Discretion.
Earnings and losses shall be allocated to each Participant's Accounts on each
Valuation Date.
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4.6 FEES AND EXPENSES.
(a) FEES. Members of the Committee shall serve without remuneration, but
the Trustee shall be paid fees in such amount and manner as may from time to
time be mutually agreed to in writing between the Trustee and the Company;
provided, however, that no fees (except for reimbursement of expenses properly
and actually incurred) shall be paid to a Trustee for any period during which
such person received full-time compensation from the Company or any member of
the Employer Group and also served as Trustee.
(b) EXPENSES. The expenses of the Trustee and the Committee, including but
not limited to the Trustee's fees, shall be paid by the Company. However, if the
Company elects not to pay these expenses for any reason, such expenses shall be
paid by the Trustee out of the Trust Fund. Moreover, any expenses which the
Trustee or Committee shall incur with special reference to any Participant's
Account may, in the Committee's Discretion, first be accounted for and charged
against such Account to the extent that the same is sufficient for such purpose.
Further, the Committee, in its Discretion, may decide to use another method of
accounting for expenses in a nondiscriminatory manner.
4.7 SEPARATE ACCOUNTING. The provisions of this Article 4 shall be so applied
and interpreted as to provide separate accounting within the meaning of section
204(b)(2)(B) of the Act for each Participant's interest under the Plan. The fact
that an individual account is established for each Participant shall not be
construed to give such Participant any interest in such account except as
provided in Article 6 (Benefits and Distributions) and elsewhere in the Plan.
ARTICLE 5
VESTING
5.1 VESTING IN ELECTIVE CONTRIBUTION ACCOUNT. A Participant's interest in his or
her Elective Contribution Account shall at all times be fully vested and
Nonforfeitable.
5.2 VESTING IN MATCHING CONTRIBUTION ACCOUNT. A Participant shall have a
Nonforfeitable right to his or her Matching Contribution Account in accordance
with the vesting schedule below, except that a Participant who Retires, dies, or
becomes Disabled shall become fully Nonforfeitable on such event:
COMPLETED YEARS OF SERVICE NONFORFEITABLE PERCENTAGE
Less than 1 year 0%
1 year 20%
2 years 40%
3 years 60%
4 years 80%
5 years 100%
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Notwithstanding the preceding, Transok, Inc. Employees at the Crescent, Ames and
North Louisiana gathering systems who became employees of the entity which
purchased the relevant assets from Transok, Inc. immediately after the purchase
shall have a Nonforfeitable percentage of one hundred percent (100%) on such
date.
5.3 FORFEITURE OF NONVESTED PORTION OF MATCHING CONTRIBUTION ACCOUNT. The
nonvested portion of a Participant's Matching Contribution Account shall be
forfeited at the end of the Plan Year in which a Participant or Beneficiary
receives a distribution of the vested portion of his or her Accounts due to
termination of employment. However, if the Participant does not receive a
distribution before he or she looses the ability to become vested in a portion
of the Participant's Accounts pursuant to section 5.5(b)(iii), the nonvested
portion shall be forfeited on the date such ability to be come vested is lost.
The Forfeiture shall be used as provided in section 4.1(d) (Allocation of
Forfeitures).
5.4 RESTORATION OF FORFEITURE UPON REEMPLOYMENT. If a Participant receives a
distribution of his Matching Contribution Account which does not include the
entire balance of his Matching Contribution Account, and is later reemployed as
a Covered Employee, such Participant's Matching Contribution Account shall be
restored to its amount on the date of distribution if the Participant repays to
the Plan the full amount of the distribution on or before the end of five (5)
consecutive one-year Periods of Severance beginning after the distribution. Such
restoration shall be made on the Anniversary Date coincident or next following
the repayment first from Forfeitures for the Plan Year of the restoration, to
the extent of such Forfeitures, as provided in section 4.1(d) (Allocation of
Forfeitures). To the extent the Forfeitures are insufficient, such restoration
shall be made from the net income or gain of the Trust Fund for such Plan Year,
and if such net income or gain is insufficient, shall be made from additional
Company Contributions.
5.5 YEARS OF SERVICE.
(a) GENERAL RULE. An Employee shall be credited with the number of Years
of Service equal to the number of whole years of his Periods of Service, whether
or not such Periods of Service were completed consecutively. In order to
determine an Employee's whole Years of Service, nonsuccessive Periods of Service
shall be aggregated with less than whole Years of Service aggregated on the
basis that 365 days of service equal a whole Year of Service.
(b) EXCEPTIONS. All Periods of Service, as determined in subsection (a)
above, shall be taken into account except the following:
(i) In the case of any Employee who has a One Year Period of Severance,
Periods of Service before such One Year Period of Severance shall
not be required to be taken into account until such Employee has
completed a one year Period of Service subsequent to his
Reemployment Commencement Date.
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(ii) In the case of any Employee who has no vested right to any benefit
derived from Employer Contributions hereunder, Periods of Service
with the Employer before a Period of Severance shall not be required
to be taken into account if the Employee's latest Period of
Severance equals or exceeds five (5) consecutive years. The Period
of Service before such Period of Severance shall be deemed not to
include any Period of Service not required to be taken into account
by reason of any prior Period of Severance.
(iii) Periods of Service after any five (5) consecutive One Year Periods
of Severance shall not be taken into account for purposes of
determining the Participant's Nonforfeitable interest in Plan
benefits prior to such five (5) consecutive year One Year Periods of
Severance.
(c) SERVICE SPANNING RULES. In determining the Period of Service, an
Employee's Periods of Severance shall be counted as Periods of Service under the
following circumstances:
(i) If an Employee severs from service by reason of his quitting,
discharge, or retirement and the Employee then performs an Hour of
Service for a member of the Employer Group within twelve (12) months
of his Severance from Service Date, his Period of Severance is taken
into account under the Plan as a Period of Service.
(ii) Notwithstanding subsection (i) above, if an Employee severs from
service by reason of his quitting, discharge or retirement during an
absence from service of twelve (12) months or less for any reason
other than his quitting, discharge or retirement, and then performs
an Hour of Service for a member of the Employer Group after twelve
(12) months from the date on which the Employee was first absent
from service, his Period of Severance shall not be taken into
account under the Plan as a Period of Service.
(d) DEFINITIONS.
(i) EMPLOYMENT COMMENCEMENT DATE means the date on which an Employee
first performs an Hour of Service.
(ii) SEVERANCE FROM SERVICE DATE means the earlier of:
(A) The date on which an Employee quits, retires, is discharged or
dies; or
(B) The first anniversary of the first day of a period in which
the Employee remains absent from service (with or without pay)
with the Employer Group for any reason other than his
quitting, retirement, discharge or death, including, but not
limited to, vacation, holiday, sickness,
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disability, leave or absence or layoff.
(iii) ONE YEAR PERIOD OF SEVERANCE is determined on the basis of a
twelve-consecutive-month period beginning on the Severance from
Service Date and ending on the first anniversary of such date
provided that the Employee during such twelve-consecutive-month
period does not perform an Hour of Service. The above
notwithstanding, in the case of an individual who is absent from
work for maternity or paternity reasons, the
twelve-consecutive-month period beginning on the first anniversary
of the first day of such absence shall not constitute a One Year
Period of Severance. For purposes of this subsection, an absence
from work for maternity or paternity reasons means an absence (A) by
reason of the pregnancy of the individual, (B) by reason of the
birth of a child of the individual, (C) by reason of the placement
of child with the individual in connection with the adoption of such
child by such individual, or (D) for purposes of caring for such
child for a period beginning immediately following such birth or
placement.
(iv) REEMPLOYMENT COMMENCEMENT DATE means the first date following a
Period of Severance which is not required to be taken into account
under the Service Spanning Rules in section 5.5(c) on which an
Employee performs an Hour of Service.
(v) PERIOD OF SEVERANCE means the period of time commencing on the
Severance from Service Date and ending on the date on which an
Employee again performs an Hour of Service. A Period of Severance
prior to June 6, 1996, under the Central and South West System
Pension Plan will be considered a Period of Severance under this
Plan.
(vi) PERIOD OF SERVICE means a period of service commencing on the
Employee's Employment Commencement Date or Reemployment Commencement
Date, whichever is applicable, and ending on the Severance from
Service Date. Periods of Service shall be aggregated unless such
Periods may be disregarded under section 5.5(b). For purposes of
this definition, the following service shall be counted:
(A) Service with the Company;
(B) Service with any member of the Employer Group;
(C) Service with Gulf Energy Development Corporation prior to
January 1, 1989;
(D) Service with Hamilton Brothers Oil Company prior to January 1,
1989;
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(E) Service with Acadian Gas Pipeline System prior to February 1,
1991, for employees who were employed by that entity on
January 31, 1991, and who became Covered Employees on February
1, 1991;
(F) Service with Texas Oil and Gas Corp. and Delhi Gas Pipeline
Corporation prior to January 1, 1991, for employees who were
employed by one of those entities on December 27, 1990 and who
became Covered Employees on January 1, 1991;
(G) Service with Enserch Corporation for Employees who were
employed by Enserch Corporation and who became employed by the
Company between December 1, 1991, and January 2, 1992;
(H) Service with Monterey Pipeline Corporation, the predecessor of
Cypress Gas Pipeline Company, or service with STHC Pipeline
Company and Exxon Gas System, Inc., the predecessors of Tejas
Gas Pipeline Company, prior to September 16, 1993, for
employees of Cypress Gas Pipeline Company, or STHC Pipeline
Company or Tejas Gas Pipeline Company, on September 16, 1993;
(I) Service with East Texas Industrial Gas Company prior to
October 16, 1993, for employees who were employed by that
company on October 12, 1993 and became Covered Employees on
October 16, 1993;
(J) Service with LEDCO, Inc. prior to February 13, 1995 for
employees who were employed by that company on February 10,
1995 and who became Covered Employees on February 13, 1995;
and
(K) Service with Transok, Inc. prior to June 6, 1996.
ARTICLE 6
BENEFITS AND DISTRIBUTIONS
6.1 DISTRIBUTION ON TERMINATION OF EMPLOYMENT. A Participant whose employment
with the Company has terminated (as defined in Article 7 (Termination of
Employment)), whether due to quitting or discharge, death or disability, shall
be eligible to receive a distribution of the Nonforfeitable balance of his
Account, determined as of the Valuation Date coincident with or next succeeding
the date of such termination of employment, paid in such manner and at such time
as may be permitted under section 6.4 (Payment of Benefits on Termination of
Employment Other than Death) and section 6.5 (Payment of Benefits on Death).
6.2 DISTRIBUTION UPON ATTAINMENT OF AGE 59-1/2. Upon application as provided by
the Committee, a Participant who has attained Age fifty-nine and one-half
(59-1/2) and who is
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not eligible to receive a distribution under section 6.1 (Termination of
Employment), shall be eligible to receive a distribution of all or any portion
of the interest of such Participant's Elective Contribution Account determined
as of the Valuation Date on or next preceding the date an application for such
distribution is received by the Committee. A distribution under this section 6.2
shall be made as soon as practicable after the application is received. A
Participant may receive only one such distribution in a Plan Year. Distributions
under this section 6.2 shall reduce a Participant's Accounts and Investment
Funds in accordance with rules established by the Committee.
6.3 DISTRIBUTION ON ACCOUNT OF HARDSHIP.
(a) IN GENERAL. Upon application as provided by the Committee, a
Participant who experiences a Hardship shall be entitled to receive a
Distribution on Account of Hardship while he or she is a Covered Employee of all
or a portion of the Participant's Nonforfeitable Accounts other than earnings on
Elective Contributions. The amount in an Account shall be determined as of the
Valuation Date on or next preceding the date of the application. For purposes of
this section 6.3, a Hardship is described in (b) below and a Distribution on
Account of Hardship is described in (c) below. A distribution which the
Committee permits under this section 6.3 shall be made as soon as practicable
following the date such application is approved as provided by the Committee.
However, no more than one such distribution shall be made in any one Plan Year.
Hardship distributions under this section 6.3 shall reduce a Participant's
Accounts and Investment Funds in accordance with rules established by the
Committee.
(b) HARDSHIP. A Hardship is an immediate and heavy financial need of the
Participant on account of:
(i) medical expenses described in section 213(d) of the Code previously
incurred by the Participant, the Participant's spouse, or any
dependents of the Participant (as defined in section 152 of the
Code) or necessary for these persons to obtain medical care
described in section 213(d) of the Code;
(ii) costs directly related to the purchase of a principal residence for
the Participant (excluding mortgage payments);
(iii) payment of tuition, related educational fees, and room and board
expenses, for the next 12 months of post-secondary education for the
Participant, his or her spouse, children or dependents;
(iv) payments necessary to prevent the eviction of the Participant from
his or her principal residence or foreclosure on the mortgage of the
Participant's principal residence; or
(v) any other event or expense which, in the Committee's Discretion,
gives rise
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to an immediate and heavy financial need, such as, but not limited
to, funeral expenses.
(c) DISTRIBUTION ON ACCOUNT OF HARDSHIP. A distribution is on Account of
Hardship if:
(i) the distribution is not in excess of the amount of the immediate and
heavy financial need, and
(ii) the Participant has obtained all distributions, other than hardship
distributions, and all nontaxable (at the time of the loan) loans
currently available under all plans maintained by the Company.
(d) SUSPENSION OF ELECTIVE CONTRIBUTIONS. If a Participant receives a
Distribution on Account of Hardship, the Participant may not make Elective
Contributions until the Valuation Date next following twelve (12) months after
receipt of the Hardship distribution. In addition, the Participant may not make
Elective Contributions for the calendar year immediately following the calendar
year of the Distribution on Account of Hardship in excess of the indexed $7,000
limit specified in section 2.2(c) (Limits on Election) for such next calendar
year less the amount of such Participant's Elective Contributions for the
calendar year of the Hardship distribution.
(e) INFORMATION REQUIRED. The Committee shall determine the existence of a
Hardship based upon information supplied by the Participant; provided, however,
that the Committee may request the Participant to supply such additional
materials as it may deem appropriate in order to make its determination.
(f) VESTING AFTER WITHDRAWAL FROM PARTIALLY VESTED ACCOUNT. At any
relevant time, the Nonforfeitable portion of a Matching Contribution Account
which was reduced by a hardship withdrawal when partially Nonforfeitable is
equal to an amount ("X") determined by the formula: X = P (AB + D) - D, where P
is the vested percentage at the relevant time; AB is the account balance at the
relevant time; D is the amount of the distribution; and the relevant time is the
time at which the Nonforfeitable percentage in the account can not increase.
6.4 PAYMENT OF BENEFITS ON TERMINATION OF EMPLOYMENT OTHER THAN DEATH.
(a) AUTOMATIC LUMP SUM DISTRIBUTION. If the total amount in all of a
Participant's Accounts as of the Valuation Date on or next following the
Participant's termination of employment with the Company is Three Thousand Five
Hundred Dollars ($3,500) or less, the Trustee shall distribute such balance in a
lump sum as soon as administratively possible after such Valuation Date without
application from the Participant or Beneficiary.
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(b) OTHER DISTRIBUTION. A Participant whose Account is greater than Three
Thousand Five Hundred Dollars ($3,500) as of the Valuation Date on or next
following the Participant's termination of employment with the Company must
apply for benefits in order to receive them prior to the deadline for benefits
specified in 6.4(c) (Deadline for Payment). Such application shall be made as
provided by the Committee. The Committee may require any Participant,
Beneficiary or other person applying for benefits to furnish it with any
information reasonably necessary for the Proper administration of the Plan. If
such Participant, Beneficiary or applicant shall fail to furnish such
information, the Committee may compute his or her benefits, if any, on any basis
deemed reasonably fit by it. No benefits shall be paid unless proof satisfactory
to the Committee evidencing entitlement to such benefits is presented to the
Committee by the person or persons claiming such benefits. Upon satisfactory
application, a lump sum distribution shall be paid to the Participant as soon as
administratively possible after the Valuation Date coincident with or next
following the date of such satisfactory application. Profits and losses shall
continue to be credited to Accounts pursuant to section 4.5 (Periodic
Adjustments to Accounts) until the Valuation Date next preceding the date of
distribution.
(c) DEADLINE FOR PAYMENT. In any event, payment of the Participant's
benefit shall be made on the earliest of:
(i) the sixtieth (60th) day after close of the Plan Year in which occurs
the latest of the following:
(A) the date the Participant reaches Age sixty-five (65);
(B) the tenth (10th) anniversary of the date the Participant
commenced participation in the Plan; or
(C) the termination of the Participant's employment with the
Company; or
(ii) for five percent owners (as defined in section 416 of the Code)
only, the April 1 of the calendar year following the calendar year
in which the Participant attains age 70-1/2.
(iii) the date of the Participant's death.
Notwithstanding the foregoing, if the amount of the payment required to commence
on the date determined pursuant to this section 6.4 cannot be ascertained by
such date or if the Committee has been unable to locate the Participant after
making reasonable efforts to do so, 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 under the Plan or the date on which the
Participant is located (whichever is applicable).
6.5 PAYMENT OF BENEFITS UPON DEATH.
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(a) IN GENERAL. Upon the death of a Participant (whether while an employee
or after employment terminates) prior to commencement or payment of benefits
under section 6.4 (Payment of Benefits on Termination of Employment Other than
Death), the Nonforfeitable balance in the Participant's Account on the Valuation
Date next following the date of death will be paid in a lump sum: (i) to the
Participant's Beneficiary, if the Participant is not married on his date of
death or has designated another Beneficiary as provided below, or (ii) to the
Participant's spouse. The Participant may designate a Beneficiary other than his
or her spouse at any time with Spousal Consent as described in (b) below.
(b) SPOUSAL CONSENT. Spousal Consent to a Beneficiary designation other
than the spouse shall be in writing, shall acknowledge the effect of the
Beneficiary designation, and shall be witnessed by a notary public or by a Plan
representative. However, the requirement of Spousal Consent shall not apply if
the Participant establishes to the satisfaction of the Committee that the
required consent may not be obtained because there is no spouse, or because the
spouse cannot be located, or because of such other reasons as may be permitted
by regulations promulgated by the Secretary of the Treasury. For purposes of
Spousal Consent, a former spouse shall be treated as a spouse to the extent
specified in a 'qualified domestic relations order' within the meaning of
section 414(p) of the Code. Spousal Consent shall be irrevocable unless the
Employee changes his or her Beneficiary designation and shall be limited to the
designated Beneficiary. However, the spouse may specifically consent to future
Beneficiary changes by the Participant without the need to obtain additional
consent of the spouse ("General Consent"). Such a General Consent shall
acknowledge that the spouse has the right to limit consent to a specific
Beneficiary, and that the spouse voluntarily relinquishes this right. A spouse's
General Consent shall be irrevocable.
(c) DESIGNATION OF BENEFICIARY. A Participant shall have the right to file
with the Committee, at any time after his or her Plan participation commences, a
written designation of Beneficiary, subject to section 6.5 (a) and (b), which
designation may from time to time be amended and revoked, provided, however,
that no designation, amendment, or revocation thereof shall become effective if
filed after such Participant's death. In the absence of an effective designation
of Beneficiary, or if the Beneficiary shall not survive the Participant, then
his or her death benefits shall be paid to the individual (or to the individuals
in equal shares, per capita) in the first of the following classes of successive
preference Beneficiaries in which there shall be any individual surviving such
Participant:
(i) Spouse,
(ii) Children or children of deceased children, per stirpes (adopted
children shall be treated as if they were the natural offspring of
their adoptive parents),
(iii) Parents, or
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(iv) Brothers and sisters (or children of deceased brothers and sisters,
per stirpes).
In the event of the failure of all of the above categories, then said death
benefits shall be paid to such Participant's estate.
6.6 MEDIUM OF DISTRIBUTION. Distributions shall be made in cash, except
Participants may elect to receive funds invested in Company stock in the form of
Company stock.
6.7 RESTRICTIONS ON COMPANY SECURITIES. Any Company securities may be subject to
such restrictions as to their transfer, distribution or subsequent disposal as,
in the Committee's Discretion, may be necessary to comply with applicable
securities laws.
6.8 BENEFIT RECIPIENTS.
(a) DISTRIBUTIONS TO PARTICIPANTS. Payment of Plan benefits shall be made
only to the Participant or, if applicable, his or her spouse or other
Beneficiary; provided, however, that the entire balance of a Participant's
Account may, at the election of the Participant, be transferred directly to the
trustee of another Qualified plan pursuant to section 12.3 (Transfers to Other
Qualified Plans) if such other plan provides for receipt of such transfers and
advises the Committee in writing that it will accept the transfer. A
Participant's Account for purposes of such transfer shall be valued as of the
Valuation Date on or immediately preceding the date of such transfer.
(b) DISTRIBUTION TO MINORS AND INCOMPETENT INDIVIDUALS. If an individual
to whom benefits shall be distributable hereunder shall be a minor or adjudged
mentally incompetent, the Committee may in its Discretion direct the Trustee to
distribute all or part of such benefits by one or more of the following methods:
(i) Directly to such minor or incompetent individual;
(ii) To the legal guardian of such individual; or
(iii) To another person for the use or benefit of such individual, but
only if pursuant to an order of a court of competent jurisdiction.
The Committee and the Trustee shall not be required to see to the application of
any such distributions. Distributions made pursuant to this section 6.8(b) shall
operate as a complete discharge of responsibility of the Committee, the Trustee,
the Company and the Trust Fund.
6.9 DISTRIBUTION OF EXCESS DEFERRALS. A Participant who determines that he has
made Elective Contributions under this Plan and other retirement plans in excess
of $8,994 for the calendar year, as adjusted for cost-of-living increases by the
Secretary of Treasury, which constitute excess deferrals within the meaning of
section 402(g)(3) of the Code ("Excess Deferrals"), shall have the following
rights:
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(a) NOTIFICATION OF COMMITTEE. He may notify the Committee in writing not
later than the March 1st next following the calendar year in which such Excess
Deferrals were made that he has made an Excess Deferral and has allocated all or
a portion of the Excess Deferrals to the Plan. The Participant shall demonstrate
to the Committee's satisfaction that he or she has made an Excess Deferral.
(b) DISTRIBUTION OF EXCESS DEFERRALS. If such Participant so notifies the
Committee, the Committee shall distribute the portion of the Excess Deferrals so
allocated to it, adjusted for gains and losses during such calendar year in
accordance with Treasury Regulation section 1.401(g), to such Participant not
later than the April 15th next following the calendar year in which such Excess
Deferrals were made.
6.10 LOANS TO PARTICIPANTS.
(a) LOAN PROCEDURE. The Committee shall establish a written Loan
Procedure, which it may amend from time to time and which is herein incorporated
by reference. Under such Loan Procedure, a Covered Employee may request a loan
as provided in the Procedure, and the loan will be made if it meets all of the
requirements specified in the Plan and the Loan Procedure. Loans shall be made
available to all Covered Employees on a reasonably equivalent basis; loans shall
not be made available to Highly Compensated Employees in an amount greater than
the amount made available to other Employees, and loans shall be adequately
secured and bear a reasonable interest rate. Loans shall be made as soon as
practicable after the date of such request.
(b) MAXIMUM AMOUNT. Any such loan to a Participant shall not exceed the
lesser of:
(i) Fifty Thousand Dollars ($50,000), reduced by the excess (if any) of
(A) the highest outstanding balance of loans from the Plan during
the one-year period ending on the day before the date on which the
loan was made, over (B) the outstanding balance of loans from the
Plan on the date on which loan was made; or
(ii) one-half (1/2) of the Participant's Nonforfeitable Accounts;
provided, however, that in determining the maximum amount of any loan to be made
under this section 6.10, all Qualified plans of the Employer Group shall be
treated as one plan.
(c) MINIMUM AMOUNT. Any such loan to a Participant shall not be less than
One Thousand Dollars ($1,000).
(d) AMORTIZATION. Substantially level amortization of a loan with payments
not less frequently than quarterly shall be required over the term of the loan.
However, loan
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repayments will be suspended under this Plan as permitted under section
414(u)(4) of the Code.
(e) TERM. Any loan hereunder must have a specified repayment date, which
may in no event extend or be extended beyond five (5) years from the date such a
loan is made; provided, however, if such loan is to be used to acquire a
dwelling unit which within a reasonable time (determined by the Committee in its
Discretion) is to be used (determined by the Committee at the time the loan is
made) as the principal residence of the Participant, the repayment date of said
loan may extend or be extended beyond such five (5) year period.
(f) SECURITY. The security for the loan will be a Participant's Accounts
under the Plan to the extent necessary to fully secure the loan.
(g) EFFECT ON PARTICIPANT'S INVESTMENTS AND ALLOCATION OF LOAN. A loan
shall reduce a Participant's Accounts and Investment Funds in accordance with
rules established by the Committee. The loan shall be allocated to the
Participant's Account and interest paid on the loan shall be credited solely to
the Participant's Account.
ARTICLE 7
SPECIAL EMPLOYMENT PROVISIONS
Termination of active employment with the Company or a member of the
Employer Group shall be considered termination of employment, except that the
following does not constitute termination of employment:
(a) an absence on account of vacation, holidays, or nonbusiness hours.
(b) any absence from work authorized by the Company or a member of the
Employer Group on the basis of uniform and nondiscriminatory rules.
(c) temporary layoff (whether or not of indefinite duration); employment
will terminate if and when the individual fails to report promptly for work upon
being recalled from such layoff.
(d) a transfer to a member of the Employer Group, or, solely for purposes
of eligibility for a distribution, a reorganization of the Company or a member
of the Employer Group other than a complete liquidation or dissolution, where
the Participant remains employed by an entity involved in the reorganization.
However, if the Participant's employment with all members of the Employer Group
terminates by reason of:
(i) the sale or other disposition by the Employer Group of substantially
all of the assets (within the meaning of section 409(d)(2) of the
Code) used by the Employer Group in a trade or business of the
Employer Group; or
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(ii) the sale or other disposition by the Employer Group of its interest
in a subsidiary (within the meaning of section 409(d)(3) of the
Code); and
(iii) the Plan does not terminate as a result of the sale; and
(iv) the purchaser does not adopt the Plan, or the relevant portion of
the Plan is not merged or consolidated with the purchaser's plan;
then the employment of such Participant shall be deemed to have terminated as of
the date of such sale.
(e) an absence not exceeding 20 working days if employment is immediately
thereafter resumed.
ARTICLE 8
TOP HEAVY REQUIREMENTS
8.1 APPLICABILITY. For each Plan Year in which the Plan is Top Heavy, within the
meaning of section 8.2 (Determination of Top Heavy Status), the restrictions set
forth in section 8.4 (Top Heavy Restrictions) shall apply.
8.2 DETERMINATION OF TOP HEAVY STATUS. For any Plan Year, the determination as
to whether the Plan is Top Heavy shall be made in accordance with the following
rules:
(a) GENERAL RULE. The Plan shall be determined to be Top Heavy if, as of
the Determination Date, the sum of the Account balances of all Participants who
are Key Employees exceeds sixty percent (60%) of the sum of the Account balances
of all Key Employees and Non-Key Employees.
(b) REQUIRED AGGREGATION. Notwithstanding section 8.2(a) (General Rule),
however, there shall be aggregated with the Plan, for purposes of determining
the existence of Top Heavy status, each other plan of the Company (and of any
member of the Employer Group):
(i) in which at least one Key Employee participates or participated at
any time during the five (5) consecutive year period ending on the
Determination Date (regardless of whether the Plan is terminated),
or
(ii) which enables either the Plan or any plan described in (i) above to
meet the requirements of section 401(a)(4) or 410 of the Code.
(c) OPTIONAL AGGREGATION. Any plan of the Company or of any member of the
Employer Group, other than those which are described in section 8.2(b) (Required
Aggregation), may, at the election of the Committee, be considered with the Plan
for
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purposes of determining the existence of Top Heavy status, so long as the
aggregated plans, considered as a group, would satisfy the requirements of
sections 401(a)(4) and 410 of the Code.
(d) AGGREGATION RULE. In the event any other plan is considered with the
Plan for purposes of determining the existence of Top Heavy status, whether
pursuant to section 8.2(b) (Required Aggregation) or 8.2(c) (Optional
Aggregation), the Plan shall be considered Top Heavy only if the sum of (i) and
(ii) below exceeds sixty percent (60%) of (iii), where
(i) is the sum of the account balances (within the meaning of section
416(g) of the Code) of all Key Employees under all of the defined
contribution plans which are being aggregated;
(ii) is the sum of the present values of the accrued benefits (within the
meaning of section 416(g) of the Code) for Key Employees under all
of the defined benefit plans which are being aggregated; and
(iii) is the sum of the account balances and present values of accrued
benefits (within the meaning of section 416(g) of the Code) for all
Key Employees and Non-Key Employees under all plans which are being
aggregated.
For purposes of this section 8.2(d), the values of account balances and present
values of accrued benefits for plans being aggregated with the Plan shall be
determined as of the determination date of such plan(s) which falls within the
same calendar year as the Determination Date for the Plan.
(e) SPECIAL COMPUTATION RULES. The following rules shall be applied in
determining the Top Heavy status of the Plan under this section 8.2 and for
purposes of aggregating the Plan with another plan of the Company (or Employer
Group) in order to evaluate the Top Heavy status of such other plan.
(i) The value of an Account for purposes of this section 8.2 shall mean
its balance as of the Valuation Date coincident with or next
preceding the Determination Date, including company contributions,
if any, actually made after the Valuation Date but on or before the
Determination Date, and, for the Plan Year in which the Plan's
Effective Date occurs, including any company contributions made
after the Determination Date, but which are allocated as of any date
within such Plan Year.
(ii) The value of an Employee's (or former Employee's) Account shall be
increased by the value of all distributions from the Plan to such
Employee (or former Employee) including any direct transfers to the
trustee of another plan, but excluding distributions which are
rolled over or transferred by the
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Employee to another plan maintained by a member of the Employer
Group, occurring during the five (5) year period ending on the
Determination Date unless already included in the value of the
Account under subparagraph (i).
(iii) If, during the five (5) year period ending on the Determination
Date, an individual has not performed any services for the Company,
his or her Account shall not be considered.
8.3 TOP HEAVY DEFINITIONS. The following words, wherever used in this Article 8
(Top Heavy Requirements), shall have the meanings set forth below.
(a) DETERMINATION DATE shall mean, for any Plan Year, the last day of the
preceding Plan Year; provided, however, that the Determination Date for the Plan
Year in which occurs the Effective Date shall be the last day of the Plan Year
in which occurs the Effective Date.
(b) KEY EMPLOYEE shall mean any individual described in subparagraphs (i)
or (ii) below:
(i) Any Employee or former Employee who, at any time during the Plan
Year containing the Determination Date or during any of the four (4)
preceding Plan Years, is or was:
(A) An officer of the Company or any member of the Employer Group
whose annual Section 415 Compensation is more than 50% of the
amount in effect under section 415(b)(1)(A) of the Code, and
which is in effect on the first day of the Plan Year in which
falls the Determination Date; provided, however, that no more
than fifty (50) Employees, or if less, the greater of three
(3) Employees or ten percent (10%) of all Employees shall be
considered to be Key Employees under this section
8.3(b)(i)(A); and provided further that all Employees
described in section 414(q)(8) of the Code shall be excluded.
(B) One of the ten (10) Employees owning the largest interests in
the Company whose Section 415 Compensation is more than Thirty
Thousand Dollars ($30,000), or such other amount as may be
established by the Secretary of the Treasure pursuant to
section 415(d) of the Code as the amount described in section
415(c)(1)(A) of the Code, and which is in effect on the first
day of the calendar year in which falls the Determination
Date; provided, however, that if two (2) or more Employees
have the same interest in the Company, the Employee having the
greater annual Section 415 Compensation shall be treated as
having the larger interest; or
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(C) A person owning more than five percent (5%) of the outstanding
stock or voting power of all stock of the Company; or
(D) A person whose annual Section 415 Compensation from the
Employer Group is more than one hundred fifty thousand dollars
($150,000) and who owns more than one percent (1%) of the
outstanding stock or voting power of all stock of the
Employer.
For purposes of determining ownership under paragraphs (B),
(C), and (D) above, the constructive ownership provisions of
section 318 of the Code shall apply, with the substitution of
five percent (5%) for fifty percent (50%) in section 318(a)(2)
and the rules of subsections (b), (c) and (m) of Code section
414 shall not apply.
(ii) The Beneficiary of a person described in subparagraph (i).
(c) NON-KEY EMPLOYEE shall mean:
(i) a Participant or former Participant who is not and has never been a
Key Employee; and
(ii) the Beneficiary of a person described in subparagraph (i).
(d) SUPER TOP HEAVY shall describe the Plan if it would be Top Heavy under
section 8.2 (Determination of Top Heavy Status) if ninety percent (90%) were
substituted for sixty percent (60%) in each place where sixty percent (60%)
appears in that section.
8.4 TOP HEAVY RESTRICTIONS.
(a) IN GENERAL. If the Plan is top-heavy in a Plan Year, the minimum
contribution on behalf of a Participant for that Plan Year shall be determined
as follows:
(i) MINIMUM CONTRIBUTION. Prior to performing an allocation of Company
contributions for the Plan Year pursuant to section 4.1
(Participants' Share of Contributions), the Trustee shall allocate
to the Account of each eligible Participant who is not a Key
Employee an amount equal to three percent of such Participant's
Section 415 compensation ("Minimum Contribution"). The balance, if
any, of Matching Contributions for the Plan Year shall then be
allocated in accordance with the provisions of section 4.1
(Participants' Share of Contributions).
(ii) PARTICIPANTS ELIGIBLE. Only Participants who, as of the last day of
the Plan Year, had not terminated their employment with the Company
are eligible for the Minimum Contribution, although such
Participants are eligible whether
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or not they are otherwise entitled to an allocation pursuant to
section 4.1 (Participants' Share of Contributions).
(iii) COMPANY CONTRIBUTIONS TO BE ALLOCATED. The Minimum Contribution
shall be allocated from Matching Contributions to the extent such
Matching Contributions are (A) not required to prevent reduction in
Matching Contributions for Highly Compensated Employees as provided
in section 4.3 (Adjustment of Allocations of Matching Contribution
Accounts) and (B) meet the nondiscrimination requirements of section
401(a)(4) of the Code without regard to section 401(m) of the Code.
(iv) ADJUSTMENT FOR SMALL CONTRIBUTIONS. Notwithstanding the provisions
in subparagraph (i), in the event that the Elective Contributions
and Matching Contributions which are to be allocated among the
Accounts of Participants who are Key Employees total less than three
percent of the Section 415 Compensation of each Participant who is a
Key Employee, then the amount which is allocated to the Accounts of
Participants who are not Key Employees need not be greater than the
largest allocation to the Account of a Key Employee, expressed as a
percentage of that Key Employee's Section 415 Compensation.
(v) ALTERNATIVE METHOD FOR SATISFYING THE MINIMUM ALLOCATION
REQUIREMENT. In the event a Participant who is not a Key Employee
(who is entitled to a minimum allocation pursuant to section
8.4(a)(i)) participates both in this Plan and another Qualified plan
of the Employer, then:
(A) If such other plan is a Qualified defined contribution plan,
any employer contributions of the type which could be used as
a Minimum Contribution under the Plan made for such
Participant to such other plan shall reduce the Minimum
Contribution required under this Plan.
(B) In the event such other plan is a Qualified defined benefit
plan, such Participant shall receive a minimum annual benefit
under such defined benefit plan equal to two percent (2%) of
the product of (1) and (2), where
(1) is the Participant's average Section 415 Compensation
for the five (5) consecutive calendar years which are
included in such Participant's Years of Service, which
begin after December 31, 1983, during which the Plan was
Top Heavy, and which produce the highest average, and
(2) is the number of such Participant's Years of Service
(but not more than ten (10)) completed in Plan Years
which begin after
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December 31, 1983, during which the Plan was Top Heavy.
(b) ADJUSTMENTS TO LIMITATIONS ON ANNUAL ADDITIONS AND BENEFITS. In
determining the limitations under section 415 of the Code, which are
incorporated by reference in section 4.4 (Limitation on Annual Additions), 1.00
shall be substituted for 1.25 wherever 1.25 appears in paragraphs (2)(B) and
(3)(B) of section 415(e) of the Code; provided, however, that if the Plan is not
Super Top Heavy and if a Minimum Contribution in an amount equal to that
determined by substituting four percent (4%) for three percent (3%) in each
place where three percent (3%) appears in section 8.4(a)(i) is provided or is
satisfied by provision of benefits as described in section 8.4(a)(v)
(Alternative Method for Satisfying the Minimum Allocation Requirements) in an
amount determined by substituting three percent (3%) for two percent (2%)
wherever two percent (2%) appears in section 8.4(a)(v)(B), then the substitution
of 1.00 in place of 1.25 pursuant to this section 8.4(b) shall not be made.
ARTICLE 9
INVESTMENT FUNDS, TRUSTEE AND TRUST AGREEMENT
9.1 INVESTMENT FUNDS.
(a) IN GENERAL. The Committee may, in its Discretion, determine from time
to time the funds into which the Trust Fund shall be invested, provided that:
(i) one fund shall be designed to invest primarily in Company common
stock ("Company Common Stock Fund"); and
(ii) Matching Contributions shall be invested in the Company Common Stock
Fund until Participants direct the investment of such Contributions
into other Investment Funds as provided in (b) below. The Company
shall either make the Matching Contributions in Company Common
Stock, or make the Matching Contributions in cash and the Committee
shall direct the Trustee to purchase Company Common Stock with the
cash.
Subject to the conditions stated in (i) and (ii) above, the Committee shall
determine and change such funds in furtherance of the funding policy and
investment objectives established by the Committee pursuant to section 9.8
(Funding Policy). The Committee is specifically authorized to invest any
percentage, including more than 10 percent, of Plan assets in Company stock
funds.
(b) PARTICIPANT DIRECTION. Participants may direct the investment of their
Accounts among the Investment Funds determined by the Committee pursuant to
subsection (a). However, Matching Contributions shall be initially invested in
the Company Common Stock Fund. Thereafter, Participants may direct the
investment of such Matching Contributions and any earnings thereon among the
funds made available by the Committee
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for investment of Matching Contributions.
(d) INVESTMENT ELECTIONS. Participant investment elections pursuant to
subsection (a) shall apply separately to (i) Account balances, and (ii) future
contributions. Investment elections may be made and changed in accordance with
the Committee's rules and procedures in effect at the time. The Committee may
add or delete dates on which such elections may be made and may alter the
effective dates for these elections in its sole Discretion.
9.2 THE TRUSTEE. Tejas Gas Corporation has entered into a Trust Agreement with a
Trustee under the terms of which a Trust Fund has been established to receive
and hold contributions payable by the Company pursuant to the Plan. Additional
Trust Agreements may be entered into with additional Trustees. The Trustee may
be removed and replaced by a successor Trustee, from time to time by action of
the Board of Directors.
9.3 FORM AND TERMS OF THE TRUST AGREEMENT. Tejas Gas Corporation may from time
to time modify the form and terms of the Trust Agreement to accomplish the
purposes of the Plan.
9.4 FIDUCIARIES AND NAMED FIDUCIARIES.
(a) NAMED FIDUCIARIES. Tejas Gas Corporation and the Trustee shall be the
named fiduciaries under the Plan, within the meaning of section 402(a) of the
Act, solely to the extent of their respective responsibilities specified in the
Plan and the Trust. Tejas Gas Corporation shall be delegated the exercise of all
discretionary authority and control which is not specifically granted to the
Committee or the Trustee with respect to management of the Plan.
(b) FIDUCIARY RESPONSIBILITY. Each fiduciary (including named fiduciaries)
under this Plan shall be solely responsible for its own acts or omissions.
Except to the extent required by the Act, no fiduciary shall have the duty to
question whether any other fiduciary is fulfilling all of the responsibilities
imposed upon such other fiduciary by Federal or State law. No fiduciary shall
have any liability for a breach of fiduciary responsibility of another fiduciary
with respect to this Plan unless it participates knowingly in such breach,
knowingly undertakes to conceal such breach, has actual knowledge of such breach
and fails to take reasonable remedial action to remedy said breach or, through
it negligence in performing its own specific fiduciary responsibilities which
give rise to its status as a fiduciary, it enables such other fiduciary to
commit a breach of the latter's fiduciary responsibility. No fiduciary shall be
liable with respect to a breach of fiduciary duty if such breach is committed
before it became a fiduciary or after it ceased to be a fiduciary.
(c) ALLOCATIONS OF FIDUCIARY RESPONSIBILITIES. The named fiduciaries may
allocate their fiduciary responsibilities (other than trustee responsibility
within the meaning of section 405(c)(3) of the Act) among themselves and may
make provision for the delegation
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of fiduciary responsibility (other than trustee responsibility within the
meaning of section 405(c)(3) of the Act) under the Plan to persons who are not
named fiduciaries of the Plan. Such allocation or delegation shall be
accomplished by a written instrument executed by the named fiduciary or
fiduciaries in question, which instrument may be revoked at any time by the
named fiduciary. If the fiduciary responsibilities (other than trustee
responsibility within the meaning of section 405(c)(3) of the Act) of a named
fiduciary are allocated or delegated to any other person, the named fiduciary
shall not be liable for the acts or omissions of such person, except to the
extent that the named fiduciary violated section 404(a)(1) of the Act:
(i) With respect to such allocation or delegation, or
(ii) With respect to the establishment or implementation of the method
for accomplishing such allocation or delegation specified above, or
(iii) By continuing such allocation or delegation.
(d) EMPLOYMENT OF OTHERS. A named fiduciary (or a fiduciary appointed by a
named fiduciary pursuant to subsection (c)) may employ one or more persons to
render advice with respect to any responsibility such fiduciary has under the
Plan.
(e) LIABILITY FOR WILLFUL MISCONDUCT OR FRAUD. Nothing in this section
shall be deemed to relieve any person from liability for his own willful
misconduct or fraud.
9.5 BONDING. Except as otherwise exempted by section 412 of the Act, every
fiduciary of the Plan, within the meaning of the Act, and every person who
handles funds or other property of the Plan shall be bonded in accordance with
section 412 of the Act.
9.6 FIDUCIARY OF TRUST FUND. Except to the extent that such authority and duty
is transferred to Tejas Gas Corporation, the Committee, or an Investment Manager
pursuant to the Plan or the Trust Agreement, the Trustee shall be the fiduciary
with respect to the investment, management and control of the Trust Fund with
full Discretion, management and control thereof. Tejas Gas Corporation may
transfer to an Investment Manager the authority and duty to direct the
investment of all or part of the Trust Fund. Such transfer shall be made by
written instrument executed on behalf of Tejas Gas Corporation and by the party
so appointed, which shall thereby acknowledge that it is a fiduciary under the
Plan with respect to investments of the Plan's assets. Upon any such transfer of
authority and duty, the Investment Manager shall be the fiduciary with respect
to the investment and management of such assets of the Trust Fund, and the
Trustee shall be relieved of all responsibility with respect to the investment
and management thereof.
9.7 TRANSFER OF INVESTMENT AUTHORITY. In the event that the authority and duty
to direct the investment of all or part of the Trust Funds are transferred to an
Investment Manager, the Trustee shall not be liable or responsible for any
consequences arising from the Trustee's compliance with investment or management
directions received by the Trustee
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from the Investment Manager. The Trustee shall be under no duty to question any
directions of the Investment Manager, nor to review in any respect the manner in
which the Investment Manager exercises its authority and discharges its duties
with respect to the assets of the Trust Fund as to which it has been so
appointed.
9.8 FUNDING POLICY. The Committee shall from time to time establish a funding
policy and method consistent with the objectives of the Plan and the
requirements of Title 1 of the Act. The funding policy and method so established
shall be reviewed by the Committee at least annually. In establishing and
reviewing such funding policy and method, the Committee shall consider the
short-term and long-term investment objectives and financial needs of the Plan,
taking into account the need for liquidity to pay for benefits and the need for
investment growth. All actions of the Committee in accordance with this section
9.8 shall be communicated to the Trustee and to the Tejas Gas Corporation.
9.9 VOTING OF SECURITIES. A Participant shall have the right to instruct the
Trustee with respect to voting, tender and similar rights granted by Company
securities allocated to the Participant's Accounts. The Committee shall have the
right to instruct the Trustee with respect to voting, tender, and similar rights
granted by securities held in the Trust other than Company securities
allocated to Participants' Accounts.
ARTICLE 10
PLAN ADMINISTRATION
10.1 COMPOSITION OF COMMITTEE. The Plan shall be administered by Tejas Gas
Corporation. The Board of Directors shall appoint a Committee of three (3) or
more Employees (or other individuals familiar with the affairs and personnel of
the Company), who shall hold office at the pleasure of the Board of Directors.
Vacancies in the Committee resulting from death, resignation, removal or
otherwise shall be promptly filled by the Board of Directors, but the Committee
may exercise its powers and authority notwithstanding the existence of such
vacancies.
10.2 PLAN ADMINISTRATOR. Tejas Gas Corporation shall be the Plan Administrator
as defined in the Act.
10.3 REMOVAL AND RESIGNATION. A member of the Committee may resign at any time
upon not less than ten (10) days written notice to the Board of Directors,
specifying the effective date of resignation. A member may be removed or
appointed by the Board of Directors for any reason or for no reason and at any
meeting of the Board of Directors, whether or not called for that purpose.
10.4 QUORUM. The Committee shall act by a majority of its members at the time in
office, and such action may be taken either by vote at a meeting or in writing
without a meeting. A member of the Committee shall not vote or act on any matter
relating solely to himself.
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10.5 OFFICERS. The Committee may by majority action appoint from among its
number a Chairman to preside at its meetings and a Secretary, who need not be a
member, to keep records of its meetings and activities and to perform such other
duties and functions as the Committee may prescribe. It may in like manner
designate any one or more of its members or its Secretary to execute any
instrument or document on its behalf, and the action of such person shall have
the same force and effect as if taken by the entire Committee. In the event of
such authorization, the Committee shall in writing notify the other
Administrative Parties thereof, and such parties shall be entitled to rely upon
such notification until the Committee shall give written notification to the
contrary.
10.6 DESIGNATED ADMINISTRATOR. The Committee may, in its Discretion, appoint a
Designated Administrator with some or all of its powers, rights and duties, who
shall serve until relieved of his duties by the Committee or until he resigns.
10.7 DUTIES OF COMPANY. In addition to its other duties and responsibilities set
forth in this Plan, the Company shall:
(a) Notify Covered Employees of the Plan and Trust, including the basic
provisions thereof, and keep them and the other Administrative Parties advised
from time to time of any contributions thereto, any substantial changes therein,
and any discontinuance, suspension or termination thereof, as well as the
identities of, and any changes in, the Committee members and the Trustee.
(b) Maintain records with respect to each Employee sufficient to determine
the benefits due, or which may become due, to such Employee under the Plan.
(c) Furnish the Committee with all information necessary for the
performance of the Committee's duties under this Plan.
(d) Promptly after each Anniversary Date furnish the Committee and the
Trustee with a reasonably detailed list of all Participants, and of all Covered
Employees who are eligible to become Participants, as of such Anniversary Date.
(e) Make available to the Committee for its inspection, at all reasonable
times, all such books and records of the Company as may be reasonably necessary
for the Committee's performance of its duties under this Plan, including but not
limited to the Company's personnel records, annual reports and financial
statements; provided, however, that the Committee shall not be required to make
such inspection but may in good faith rely upon any statement or information
furnished by or on behalf of the Company.
10.8 DUTIES OF COMMITTEE. In addition to its other duties and responsibilities
set forth in this Plan, the Committee shall:
(a) Determine eligibility for benefits and construe the terms of the Plan,
in its
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Discretion, but in accordance with the provisions of the Plan, Trust and the
Act.
(b) Maintain or cause to be maintained the data and information necessary
for the administration of the Plan, including all statements, reports and other
information furnished to it by the other Administrative Parties.
(c) Make available to each Participant, at all reasonable times during
business hours, a copy of this Plan and such of the Committee's records as
pertain to such Participant or his Account.
(d) Furnish Participants at appropriate times, or upon request, with forms
for designations of Beneficiary and other administrative forms provided for in
the Plan.
(e) Indicate acceptance or rejection of designations of Beneficiaries.
(f) Maintain and promptly furnish to the Trustee the information necessary
to determine the amount allocable to each Participant's Account.
(g) Maintain and furnish to the Trustee such other certificates,
information and documents as may reasonably be required, relating (but not
limited) to such matters as: the identities and addresses of all Participants
and Beneficiaries; the age, Compensation, retirement date, and employment record
of every Participant; and the date of, and reasons for, termination of a
Participant's employment.
(h) Establish and communicate to Covered Employees a procedure for
execution and delivery of Elective Contribution Agreements and develop and
communicate to Covered Employees administrative rules concerning designation of
participation levels, timing of designations, and related matters.
(i) Establish reasonable procedures for determining the existence of a
"qualified domestic relations order" within the meaning of section 414(p) of the
Code and notify affected persons of such procedures.
(j) Except as otherwise provided in Section 9.9 (Voting of Securities),
have the right to instruct the Trustee concerning the voting and tendering of
securities held in the Trust Fund.
10.9 CLAIMS PROCEDURE.
(a) INITIAL NOTIFICATION. If a claim for benefits under the Plan is
denied, in whole or in part, the claimant shall be notified in writing of the
denial, the specific reason for the denial and the Plan provisions on which the
denial is based, within ninety (90) days after the claim has been filed with the
Committee. Such claimant shall also be advised whether any additional material
or information is necessary to perfect the claim and shall be provided
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with an explanation of the reasons why such material is necessary and with an
explanation of the Plan's claim review procedure under section 10.9(b).
(b) DENIAL OF CLAIM. In the event a claim for benefits under the Plan is
denied, in whole or in part:
(i) The claimant (or his duly authorized representative) shall be
entitled to request in writing a review of the denial of his claim
by the Committee within sixty (60) days after the claimant receives
notice of the denial of his claim.
(ii) The claimant (or his duly authorized representative) may review
pertinent Plan documents and submit issues and comments to the
Committee in writing.
(iii) All written claims that are neither granted nor denied in accordance
with section 10.9(a)shall be deemed denied and the claimant shall be
deemed to have filed a written request for review.
(iv) The decision of the Committee on review shall be rendered within
sixty (60) days after the request for review is received by the
Committee unless special circumstances require an extension of time
for processing the claim, in which case a decision shall be rendered
not later than one hundred twenty (120) days after receipt of a
request for review by the Committee.
(v) The claimant shall be furnished with written notice of any such
extension of time prior to the commencement of the extension.
(vi) If the decision of the Committee on review is not furnished within
the time specified in section 10.9(b)(iv) above, the claim shall be
deemed denied on review.
(vii) The decision of the Committee on review shall be in writing and
shall include specific reasons for the decision and specific
references to the pertinent Plan provisions on which the decision is
based.
(viii) The decision of the Committee on review is final.
10.10 POWERS. The Committee shall have the power and authority to determine, in
its Discretion, eligibility for benefits and to construe, in its Discretion, the
terms of the Plan. The Committee shall have any and all powers and authority
which shall be Proper to enable it to carry out its duties under this Plan,
including by way of illustration but not limitation (i) the powers and authority
contemplated by the Act and by the Code with respect to Qualified plans and (ii)
the powers and authority to make rules and regulations in respect of the Plan
not inconsistent with this Plan, the Code or the Act and to determine,
consistently therewith, all questions that may arise as to the status and rights
of Participants
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and Beneficiaries and any other persons.
10.11 DISCRETION; NONDISCRIMINATION. Wherever it is provided in this Plan that
the Committee may perform or not perform any act, or permit or consent to any
action, inaction or procedure, or wherever the Committee shall be given
discretionary power or authority, the Committee shall have exclusive Discretion
in the premises; provided, however, that the Committee shall not exercise its
Discretion in such a manner as to violate the Code or the Act or knowingly to
discriminate either for or against any Participant, Covered Employee or
Beneficiary or any group of such persons.
10.12 NO SEPARATE COMMITTEE. Notwithstanding the foregoing provisions of this
Article 10, if and while there is no Committee, either because none is
designated or no one or more persons are at the time in question actively
serving as members thereof, the responsibilities, rights, powers, authority, and
functions of the Committee shall be vested in the Company; and the Company need
not furnish information, directions, instructions or notices, or make reports or
demands, to itself.
10.13 UNCLAIMED BENEFITS. If a Participant's Nonforfeitable Accounts are
unclaimed on or after the deadline for payment specified in section 6.4(c)
(Deadline for Payment), and the Committee is unable to locate the Participant or
Beneficiary, the amount in the Participant's Accounts shall be forfeited and
used as provided in section 4.1(d) (Allocation of Forfeitures). Prior to such
forfeiture, the Committee shall mail by certified mail to such Participant or
Beneficiary at his or her last known address, a written request for his or her
then address and wait three months for a response. If the Committee receives the
requested information prior to termination of the Trust pursuant to section 11.2
(Termination of Trust), such forfeiture shall be restored, first from
Forfeitures for the Plan Year of restoration, next from the net income or gain
of the Trust Fund for such Plan Year, and last from additional Company
contributions. As such unclaimed benefits shall be and remain assets of the
Trust, in no event shall they escheat to any governmental entity under any
escheat law.
ARTICLE 11
TERMINATION AND AMENDMENT
11.1 TERMINATION OF PLAN. It is the present intention of Tejas Gas Corporation
to permanently maintain the Plan and continue to make contributions under
section 3.1 (Type, Amount and Time of Contributions); provided, however, that
subject to the requirements of the Act and the Code:
(a) RIGHT TO TERMINATE. Each Company reserves the right at any time to
revoke or permanently or partially terminate the Plan to the extent that it
relates to that Company and its Employees, or to terminate or suspend its
liability to make further contributions to the Trust pursuant to section 3.1
(Type, Amount and Time of Contributions) on behalf of its Employees. Tejas Gas
Corporation reserves the right at any time to revoke or terminate
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the Plan in its entirety, or to terminate or suspend the liability of any or all
Companies to make further contributions to the Trust pursuant to section 3.1
(Type, Amount and Time of Contributions).
(b) NONFORFEITABILITY. In the event of any termination, or partial
termination or suspension (within the meaning of Treas. Reg. ss. 411(d)-2))
under paragraph (a) above, the right of each Participant to the amount credited
to his or her Account at the time of such termination or partial termination
shall become one hundred percent (100%) Nonforfeitable.
11.2 TERMINATION OF TRUST. In the event of termination of the Plan as specified
in section 11.1 (Termination of Plan), Tejas Gas Corporation may, but is not
required to, instruct the Trustee to liquidate part or all of the Trust Fund. If
Tejas Gas Corporation so instructs, the Trustee shall proceed as promptly as
possible, subject to any directions from the Committee, to liquidate necessary
investments (or all investment, if the Plan is terminated in its entirety). The
Committee shall thereupon determine the value of the Account of each
Participant, after adjustment to cover any expenses of distribution and final
liquidation costs. The Trustee shall pay such value to the Participant (or, if
deceased, to his or her Beneficiary) in a lump sum. However, no distribution
shall be made from the Plan on account of its termination if a successor plan
(defined in Treasury Regulation section 1.401(k)-1(d)(3)) is established within
one year of such termination. Notwithstanding termination of the Plan, the Trust
shall terminate when and if, but not until, the Trust Fund shall be entirely
paid out and distributed in accordance with its terms and the terms of this
Plan.
11.3 AMENDMENT. Tejas Gas Corporation reserves the right at any time and from
time to time to amend the Plan, without the consent of any other company or any
Participant or Beneficiary, in any manner which it deems to be Proper, whether
or not (i) for reasons of business necessity or (ii) for the purpose of causing
the Plan and Trust to be Qualified or to continue to be Qualified. Any
modification, alteration or amendment may be made effective retroactively within
the limits satisfactory to the Internal Revenue Service and the Department of
Labor. Any modification, alteration or amendment shall be binding on the
Administrative Parties, the Participants and Beneficiaries.
ARTICLE 12
TRANSFERRED ASSETS AND ROLLOVER CONTRIBUTIONS
12.1 RIGHT TO TRANSFER ASSETS TO THIS PLAN.
(a) IN GENERAL. In the event of a merger of this Plan with another Plan,
or transaction between the Company and another company that is a stock or asset
acquisition, a merger, or other similar transaction involving a change in the
employer of the employees of a trade or business, the Committee may, in its
Discretion, instruct the Trustee to accept, on behalf of a Participant,
Transferred Assets. As used in the Plan, the phrase "Transferred
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Assets" shall mean those funds which are transferred from a Qualified trust
directly to the Trust Fund by the trustee of the Qualified trust on behalf of
the Participant, provided that:
(i) if the transfer is not the result of a plan merger, the Participant
has a Nonforfeitable right to the Transferred Assets; and
(ii) the plan from which the assets are transferred provides benefits
protected under section 411(d)(6) of the Code which are also
protected by this Plan.
Transferred Assets shall be credited to separate accounts established for the
purpose of holding such assets, except as provided in (b), (c) and (d) below.
(b) ASSETS FROM PRIOR PLAN. The term "Transferred Assets" includes the
assets from the Prior Plan which became assets of this Plan as a result of the
spinoff and merger of the portion of the Prior Plan adopted by Tejas Gas
Corporation with this Plan. Assets transferred from the Prior Plan which are
elective contributions shall be credited to the Elective Contribution Account,
assets transferred from the Prior Plan which are matching contributions shall be
credited to the Transferred Matching Account. Post-tax contributions transferred
from the Prior Plan shall be credited to the Post-Tax Contribution Account.
Notwithstanding the preceding, a LEDCO Transferred Asset Account shall be
established to hold the elective and matching accounts transferred from the
LEDCO, Inc. 401(k) Profit Sharing Plan for each Participant with respect to whom
such assets are transferred. The rules regarding the LEDCO Transferred Asset
Account are described in Appendix A of the Plan.
(c) TRANSFERRED MATCHING ACCOUNT. The Participant's Transferred Matching
Account shall be treated as the Participant's Matching Contribution Account for
all purposes under the Plan, including vesting under section 5.2 (Vesting in
Matching Contribution Account); provided, however, that if the Participant is
fully vested in his Transferred Matching Account pursuant to section 5.2,
amounts in his or her Transferred Matching Account may be withdrawn as provided
in section 6.2 (Distribution Upon Attainment of Age 59-1/2).
(d) POST-TAX CONTRIBUTION ACCOUNT. Upon application to the Committee, a
Participant may, while an Employee, withdraw all or any part of his or her
Post-Tax Contribution Account determined as of the Valuation Date on or next
following the date an application for such distribution is received by the
Committee. The Participant may make only one such withdrawal. An in-service
withdrawal of amounts in the Participant's Post-Tax Contribution Account shall
reduce a Participant's Account and Investment Funds in accordance with rules
established by the Committee. Amounts in the Post-Tax Contribution Account may
also be withdrawn as provided in section 6.2 (Distribution Upon Attainment of
Age 59-1/2) and section 6.3 (Distribution on Account of Hardship). Further,
amounts in the Participant's Post-Tax Contribution Account are subject to the
provisions of section 6.10 (Loans to Participants). Any balance in a
Participant's Post-Tax Contribution
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Account not previously distributed shall be paid to him or her following his or
her Retirement or other termination of employment, or to his or her Beneficiary
in the event of his or her death, in the same manner as other benefits under the
Plan are payable upon the occurrence of such events. The Post-Tax Contribution
Account shall be subject to Participant investment direction as provided for
Elective Contributions in section 9.1 (Investment Funds).
12.2 RIGHT TO MAKE ROLLOVER CONTRIBUTIONS TO THIS PLAN. The Committee shall
instruct the Trustee to accept, on behalf of a Participant, Rollover
Contributions, which shall be credited to a separate account established by the
Committee for the Participant ("Rollover Contribution Account"). Rollover
Contributions:
(a) are distributed to the Participant from a Qualified trust and
transferred by the Participant to the Trust Fund within sixty (60) days of the
distribution; OR
(b) qualify as optional direct transfers of Eligible Rollover
Distributions from a Qualified trust; OR
(c) are distributed to the Participant from a Qualified trust and
transferred by the Participant to an individual retirement account (within the
meaning of section 408 of the Code) which holds only amounts transferred from
Qualified trusts within sixty (60) days of distribution from the individual
retirement account; AND
(d) meet the other requirements of section 402(c) of the Code; AND
(e) consist of cash, and other investments which the Committee determines
in its Discretion to be appropriate.
Amounts in the Rollover Contribution Account are to be treated as amounts in the
Participant's Elective Contribution Account for all purposes under the Plan.
12.3 TRANSFERS TO OTHER QUALIFIED PLANS.
(a) CHANGE IN EMPLOYER. In the event of a merger of this Plan with another
Plan, or transaction between the Company and another company that is a stock or
asset acquisition, a merger, or other similar transaction involving a change in
the employer of the employees of a trade or business, the Committee may, in its
Discretion, transfer the Participant's Accounts to another Qualified plan and
trust which is maintained by the employer of the Participant or an affiliated
employer and which makes provision for receiving such transferred assets. Prior
to the transfer of any Accounts, the Committee must be satisfied that the
holding of such assets is permitted in the transferee plan and trust, and that
the plan to which the assets are transferred will continue to provide the
protections required under section 411(d)(6) of the Code.
(b) OPTIONAL DIRECT TRANSFER OF ELIGIBLE ROLLOVER DISTRIBUTIONS. A
Distributee
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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. For purposes
of this section:
(i) An "Eligible Rollover Distribution" means any distribution of $200
or more of the balance to the credit of the Distributee, except that
an Eligible Rollover Distribution does not include: any distribution
that is one of a series of substantially equal periodic payments
(not less frequently than annually) made for the life (or life
expectancy) of the Distributee and the Distributee's designated
beneficiary, or for a specified period of ten years or more; any
distribution to the extent such distribution is required under
section 401(a)(9) of the Code; and the portion of any distribution
that is not includible in the gross income (determined without
regard to the exclusion for net unrealized appreciation with respect
to Company securities). However, if the Distributee elects a Direct
Rollover of only a portion of an Eligible Rollover Distribution,
that portion must be equal to at least $500.
(ii) An "Eligible Retirement Plan" means an eligible retirement account
described in section 408(a) of the Code, an individual retirement
annuity described in section 408(b) of the Code, an annuity plan
described in section 403(a) of the Code, or a Qualified trust, 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.
(iii) A "Distributee" includes an employee or former employee. In
addition, the employee's or former employee's surviving spouse and
the employee's or former employee's spouse or former spouse who is
the alternate payee under a qualified domestic relations order, as
defined in section 414(p) of the Code, are Distributees with regard
to the interest of the spouse or former spouse.
(iv) "Direct Rollover" means a payment by the Plan to the Eligible
Retirement Plan specified by the Distributee.
ARTICLE 13
MISCELLANEOUS
13.1 NO REVERSION. Except as otherwise provided by section 3.2 (Return of
Contributions) and subsection (b)(v) of section 4.4 (Limitation on Annual
Contributions), the assets of the Trust shall never inure to the benefit of the
Company and shall be held for the exclusive purposes of providing benefits to
Participants and their Beneficiaries and defraying reasonable expenses of
administering the Plan. The Company shall not be entitled to receive or recover
any part of its contributions to the Trust or the earnings thereof.
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13.2 MERGER, CONSOLIDATION, ETC. In no event may the Plan be merged or
consolidated with, or the assets or liabilities of the Trust Fund transferred
to, any other Qualified plan, unless each Participant would (if such other
Qualified plan were terminated after such merger, consolidation or transfer of
assets and liabilities) receive a benefit which is not less than the benefit he
would have been entitled to receive had the Plan been terminated immediately
before such merger, consolidation or transfer.
13.3 LIMITATIONS ON ASSIGNMENT.
(a) IN GENERAL. To the extent permitted by law, no benefits, payments,
proceeds, claims, rights or interest of any Participant or Beneficiary in, to or
under the Plan, the Trust or any part of the Trust Fund, shall be liable or
subject to the debts, contracts, liabilities, engagements or torts of any such
person, directly or indirectly, or subject to any claim of any creditor of such
person, through legal process or otherwise; nor shall any such Participant or
Beneficiary be able or permitted to transfer, encumber, pledge, anticipate,
alienate or assign any such benefits, payments, proceeds, claims, rights, or
interest, contingent or otherwise. It is the intention and purpose of the
parties to this Plan to place the absolute title to the Trust Fund in the
Trustee alone, with power and authority to pay out the same only as provided in
this Plan.
(b) QUALIFIED DOMESTIC RELATIONS ORDERS. Notwithstanding paragraph (a)
above, the Trustee shall honor an assignment to, or an order to segregate assets
for, or instructions, to make benefit payments to a person other than a
Participant or Beneficiary if the Committee so directs and the Committee has
determined that there exists a "qualified domestic relations order," within
the meaning of section 414(p) of the Code, pursuant to which such assignment,
segregation, or payment is required. The Committee shall direct the Trustee to
make a lump sum distribution to the alternate payee of the amount ordered as
soon as reasonably possible after the date indicated in the order, even though
the Participant is not yet entitled to a distribution from the Plan. The
Committee shall establish written procedures for determining the existence of a
"qualified domestic relations order" and for compliance by the Plan with the
applicable provisions thereof.
13.4 EXECUTION OF INSTRUMENTS. Except as otherwise expressly provided in this
Plan, any instrument or document to be delivered or furnished by the Company
shall be sufficiently executed if executed in the name of the Company by any
officer or officers thereof; or, where furnished or delivered by the Committee,
if executed in the name of the Committee by any member thereof; or where
furnished or delivered by the Trustee, if executed by the Trustee (whether or
not the sole Trustee), in the name of such Trustee by any officer or officers
thereof; provided, further, that any Administrative Party shall be fully
protected in relying upon any instrument or document so executed; and execution
as aforesaid shall be conclusive proof that any signature so affixed is duly
authorized and that any information contained in such instrument or document is
true and correct.
13.5 COMPANY ACTIONS. Whenever the Company under this Plan is permitted or
required
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to do or perform any act or execute any paper or document, it shall be done,
performed or executed by or at the direction of the board of directors or by an
officer or the Company thereunto duly authorized.
13.6 SUCCESSORS. ETC. This Plan shall be binding upon, and inure to the benefit
of, the Company and subject to section 11.1 (Termination of Plan), its
successors, the Trustee and its successors, the Committee as from time to time
constituted, and the Participants and Beneficiaries, their heirs, personal
representatives, successors, and assigns, all in accordance with and subject to
the terms of this Plan.
13.7 MISCELLANEOUS PROTECTIVE PROVISIONS. Except as otherwise provided in this
Plan or the Act:
(a) OPINION OF COUNSEL. Any Administrative Party may request and rely upon
an opinion of counsel, who may or may not be counsel for the Company and shall
be fully protected for any action taken, suffered or omitted in good faith
reliance upon such opinion.
(b) PROTECTION OF CERTAIN PARTIES. No recourse under this Plan, or for any
action or inaction hereunder or for any loss or diminution of the Trust Fund, or
for any payment or nonpayment of benefits, or for any other reason whatsoever
relating to the Plan, shall be had by any person whomsoever against any past,
present or future officer or Employee of the Company.
(c) EVIDENCE. Where the establishment of any fact is in question, any
Administrative Party may in its Discretion accept as evidence thereof any
properly executed instrument or document furnished by any other Administrative
Party or such other evidence as may seem reasonable in the circumstances.
13.8 MORE THAN ONE COMPANY.
(a) CREDITING SERVICE. For purpose of the vesting provisions hereof (but
not for purposes of allocation of contributions), in the event that an employee
of a member of the Employer Group other than the Company is transferred to
employment with the Company (or from employment with the Company to employment
with a member of Employer Group other than the Company), his or her service with
such member or members of the Employer Group shall be treated as service with
the Company. In the event a Participant is transferred to employment by an
employer which is a member of the Employer Group but which is not a Company, the
transferred Participant's employment by the Company and participation in the
Plan shall not be deemed terminated by reason of such transfer, except that the
Participant may not make Elective Contributions after such transfer, and such
transferred Participant's Account shall not be credited with any portion of the
Company's Matching Contributions arising with respect to a Plan Year ending
within a taxable year of the Company after the taxable year in which such
transfer occurred.
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(b) FORFEITURES. If and while the Plan is maintained by more than one
Company, Forfeitures shall be allocated pursuant to section 4.1(d) (Allocation
of Forfeitures) as if all such Companies constitute a single Company.
13.9 INDEMNIFICATION BY THE COMPANY. To the extent permitted by the Act, the
Company shall indemnify and hold harmless the Committee members, the Trustee and
other fiduciaries of the Plan who are Employees of the Company against any
liabilities incurred by them in the exercise and performance of their powers and
duties under the Plan to the extent that such protection would be afforded by
insurance coverage under section 410(b)(3) of the Act.
13.10 EMPLOYMENT RIGHTS NOT ENLARGED. The Plan, as now or may hereafter exist,
shall not be construed as giving any Participant or any other person whomsoever
any legal or equitable right against the Company, or as giving any Participant
the right to be continued in the employ of the Company, and all employees and
all participants shall remain subject to discharge to the same extent as if this
Plan had not been adopted.
13.11 NOTIFICATION OF ADDRESS. Each Participant, former participant and
Beneficiary shall file with the Company from time to time, in writing, his
current post office address and shall notify the Company of each change in his
post office address. The Company, Committee and Trustee shall be entitled to
rely upon the last post office address furnished to the Company by such person
for purposes of providing notice to such person, payment of benefits or any
other purpose.
ARTICLE 14
EXECUTION
IN WITNESS WHEREOF, Tejas Gas Corporation has caused this document,
captioned "Tejas Gas Corporation Thrift Plan," to be executed by its duly
authorized officer this ________ day of __________________, 1996.
TEJAS GAS CORPORATION
ATTEST:
_____________________________________
By: James E. Street
_____________________________ Its: Senior Vice President
Secretary
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APPENDIX A
LEDCO TRANSFERRED ASSET ACCOUNT
APP. 1.1 IN GENERAL. The LEDCO Transferred Asset Account is established pursuant
to section 12.1(b) of the Plan to hold the elective and matching accounts
transferred from the LEDCO, Inc. 401(k) Profit Sharing Plan for each Participant
with respect to whom such assets are transferred. Each Participant shall be
fully vested in his or her LEDCO Transferred Asset Account at all times. The
LEDCO Transferred Asset Account shall be subject to the same withdrawal and
other rules as this Plan's Elective Contribution Account, except that instead of
the lump sum distribution available under this Plan, distribution of the LEDCO
Transferred Asset Account shall be made in accordance with APP. 1.2 - 1.6 below.
APP. 1.2 QUALIFIED JOINT AND SURVIVOR ANNUITY. Unless section 6.4(a) of the Plan
(Automatic Lump Sum Distribution) is applicable or unless an optional form of
benefit described in APP. 1.6 below is selected pursuant to a qualified election
within the 90-day period ending on the annuity starting date, a married
Participant's LEDCO Transferred Asset Account will be paid in the form of a
qualified joint and survivor annuity and an unmarried participant's LEDCO
Transferred Asset Account will be paid in the form of a life annuity. The
Participant may elect to have such annuity distributed upon attainment of the
earliest retirement age under the Plan.
APP. 1.3 QUALIFIED PRERETIREMENT SURVIVOR ANNUITY. Unless an optional for of
benefit described in APP. 1.6 below has been selected within the election period
pursuant to a qualified election, if a Participant dies before the annuity
starting date, then the Participant's LEDCO Transferred Asset Account shall be
applied toward the purchase of an annuity for the life of the surviving spouse.
The surviving spouse may elect to have such annuity distributed within a
reasonable period after the Participant's death. Notwithstanding the preceding,
if the LEDCO Transferred Asset Account does not exceed $3,500 at the time of any
distribution, the Plan Administrator shall direct the immediate distribution of
such amount to the Participant's spouse, or other Beneficiary if designated as
provided in section 6.5 of the Plan.
APP. 1.4 DEFINITIONS.
(a) ELECTION PERIOD: The period which begins on the first day of the Plan
Year in which the Participant attains age 35 and ends on the date of the
Participant's death. If a Participant separates from service prior to the first
day of the Plan year in which he or she attains age 35, the election period
shall begin on the date of separation.
Pre-age 35 waiver: A Participant who will not yet attain age 35 as of the
end of any current Plan Year may make a special qualified election to waive the
qualified preretirement survivor annuity for the period beginning on the date of
such election and ending on the first day of the Plan Year in which the
Participant will attain age 35. Such
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election shall not be valid unless the Participant receives a written
explanation of the qualified preretirement survivor annuity in such terms as are
comparable to the explanation required under APP. 1.5 below. Qualified
preretirement survivor annuity coverage will be automatically reinstated as of
the first day of the Plan Year in which the Participant attains age 35. Any new
waiver on or after such date shall be subject to the full requirements of this
Appendix A.
(b) EARLIEST RETIREMENT AGE: The earliest date on which, under the Plan,
the Participant could elect to receive retirement benefits.
(c) QUALIFIED ELECTION: A waiver of a qualified joint and survivor annuity
or a qualified preretirement survivor annuity. Any waiver of a qualified joint
and survivor annuity or a qualified preretirement survivor annuity shall not be
effective unless: (i) the Participant's spouse consents in writing to the
election: (ii) the election designates a specific beneficiary, including any
class of beneficiaries or any contingent beneficiaries, which may not be changed
without spousal consent (or the spouse expressly permits designations by the
Participant without any further spousal consent); (iii) the spouse's consent
acknowledges the effect of the election; and (iv) the spouse's consent is
witnessed by a Plan representative or notary public. Additionally, a
Participant's waiver of the qualified joint and survivor annuity shall not be
effective unless the election designates a form of benefit payment which may not
be changed without spousal consent (or the spouse expressly permits designations
by the Participant without further spousal consent). If it is established to the
satisfaction of a Plan representative that there is no spouse or that the spouse
cannot be located, a waiver will be deemed a qualified election.
Any consent by a spouse obtained under this provision (or establishment
that the consent of a spouse may not be obtained) shall be effective only with
respect to such spouse. A consent that permits designations by the Participant
without any requirement of further consent by such spouse must acknowledge that
the spouse had the right to limit consent to a specific beneficiary, and a
specific form of benefit where applicable, and that the spouse voluntarily
elects to relinquish either or both of such rights. A revocation of a prior
waiver may be made by a Participant without the consent of the spouse at any
time before the commencement of benefits. The number of revocations shall not be
limited. No consent obtained under this provision shall be valid unless the
Participant has received notice as provided in APP.1.5 below.
(d) QUALIFIED JOINT AND SURVIVOR ANNUITY: An immediate annuity for the
life of the Participant with a survivor annuity for the life of the spouse which
is 50 percent of the amount of the annuity which is payable during the joint
lives of the Participant and the spouse and which is the amount of benefit which
can be purchased with the Participant's LEDCO Transferred Asset Account.
(e) SPOUSE (SURVIVING SPOUSE): The spouse or surviving spouse of the
Participant, provided that a former spouse will be treated as the spouse or
surviving spouse and a
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current spouse will not be treated as the spouse or surviving spouse to the
extent provided under a qualified domestic relations order as described in
section 414(p) of the Code.
(f) ANNUITY STARTING DATE: The first day of the first period for which an
amount is payable as an annuity or in any other form.
APP. 1.5 NOTICE REQUIREMENT.
(a) QUALIFIED JOINT AND SURVIVOR ANNUITY. In the case of a qualified joint
and survivor annuity, the Plan Administrator shall no less than 30 days and no
more than 90 days prior to the annuity starting date provide each Participant a
written explanation of: (i) the terms and conditions of a qualified joint and
survivor annuity; (ii) the Participant's right to make and the effect of an
election to waive the qualified joint and survivor annuity form of benefit;
(iii) the rights of a Participant's spouse; and (iv) the right to make, and the
effect of, a revocation of a previous election to waive the qualified joint and
survivor annuity.
(b) QUALIFIED PRERETIREMENT SURVIVOR ANNUITY. In the case of a qualified
preretirement survivor annuity, the Plan Administrator shall provide each
Participant within the applicable period for such Participant a written
explanation of the qualified preretirement survivor annuity in such terms and in
such manner as would be comparable to the explanation provided for meeting the
requirement of APP. 1.5(a) above.
The applicable period for a Participant is the period beginning with the
first day of the Plan Year in which the Participant attains age 32 and ending
with the close of the Plan Year preceding the Plan Year in which the Participant
attains age 35. In the case of a Participant who separates for service before
attaining age 35, notice must be provided within the two-year period beginning
one year prior to separation and ending one year after separation. If such a
Participant thereafter returns to employment with the Employer, the applicable
period for such Participant shall be redetermined.
APP. 1.6 The following optional forms of benefits are available with respect to
the LEDCO Transferred Asset Account:
(a) One lump sum payment; and
(b) Payment in monthly, quarterly, semi-annual or annual cash installments
over a period to be determined by the Participant or his or her Beneficiary.
This option is not available if the Participant's LEDCO Transferred Asset
Account is $3,500 or less at the time of distribution.
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Exhibit 23
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Tejas Gas Corporation on Form S-8 of our reports dated February 14, 1996 (April
11, 1996 as to paragraph 5 of Note 12) and June 25, 1996 appearing in the Annual
Report on Form 10-K of Tejas Gas Corporation for the year ended December 31,
1995 and in the Annual Report on Form 11-K of the Tejas Gas Corporation Thrift
Plan for the year ended December 31, 1995, respectively.
/s/ DELOITTE & TOUCHE
Deloitte & Touche LLP
Houston, Texas
December 19, 1996
EXHIBIT 24
TEJAS GAS CORPORATION
POWER OF ATTORNEY
WHEREAS, TEJAS GAS CORPORATION, a Delaware corporation (the
"Company"), intends to file with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the "Securities
Act"), a Registration Statement or Registration Statements on Form S-8, with any
amendment or amendments thereto (including post-effective amendments) and any
supplement or supplements thereto (the "Registration Statement"), as prescribed
by the Commission pursuant to the Securities Act and the rules and regulations
of the Commission promulgated thereunder, in each case as may be necessary or
appropriate, together with any and all exhibits and other documents relating to
the Registration Statement in connection with the registration by the Company of
its Common Stock, par value $0.25 per share, issuable pursuant to the Tejas Gas
Corporation Employee Stock Option Plan, as amended.
NOW, THEREFORE, the undersigned in his capacity as a director or
officer or both, as the case may be, of the Company, does hereby appoint Jay A.
Precourt and James W. Whalen, and each of them severally, his true and lawful
attorney or attorneys with power to act with or without the other, and with full
power of substitution and resubstitution, to execute in his name, place and
stead, in his capacity as director, officer or both, as the case may be, of the
Company, the Registration Statement, including the exhibits thereto, and any
amendment or amendments thereto (including post-effective amendments) and any
supplement or supplements thereto and any and all instruments necessary or
incidental in connection therewith, as said attorney or attorneys shall deem
necessary or incidental in connection therewith, and to file the same with the
Commission and to appear before the Commission in connection with any matter
relating thereto. Each of said attorneys shall have full power and authority to
do and perform in the name and on behalf of the undersigned, in any and all
capacities, every act whatsoever necessary or desirable to be done in the
premises, as fully and to all intents and purposes as the undersigned might or
could do in person, the undersigned hereby ratifying and approving the acts that
said attorneys and each of them, or their or his substitutes or substitute, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this power of
attorney as of December 14, 1996.
/s/ FREDERIC C. HAMILTON
Frederic C. Hamilton
<PAGE>
TEJAS GAS CORPORATION
POWER OF ATTORNEY
WHEREAS, TEJAS GAS CORPORATION, a Delaware corporation (the
ACompany@), intends to file with the Securities and Exchange Commission (the
ACommission@) under the Securities Act of 1933, as amended (the ASecurities
Act@), a Registration Statement or Registration Statements on Form S-8, with any
amendment or amendments thereto (including post-effective amendments) and any
supplement or supplements thereto (the ARegistration Statement@), as prescribed
by the Commission pursuant to the Securities Act and the rules and regulations
of the Commission promulgated thereunder, in each case as may be necessary or
appropriate, together with any and all exhibits and other documents relating to
the Registration Statement in connection with the registration by the Company of
its Common Stock, par value $0.25 per share, issuable pursuant to the Tejas Gas
Corporation Employee Stock Option Plan, as amended.
NOW, THEREFORE, the undersigned in his capacity as a director or
officer or both, as the case may be, of the Company, does hereby appoint Jay A.
Precourt and James W. Whalen, and each of them severally, his true and lawful
attorney or attorneys with power to act with or without the other, and with full
power of substitution and resubstitution, to execute in his name, place and
stead, in his capacity as director, officer or both, as the case may be, of the
Company, the Registration Statement, including the exhibits thereto, and any
amendment or amendments thereto (including post-effective amendments) and any
supplement or supplements thereto and any and all instruments necessary or
incidental in connection therewith, as said attorney or attorneys shall deem
necessary or incidental in connection therewith, and to file the same with the
Commission and to appear before the Commission in connection with any matter
relating thereto. Each of said attorneys shall have full power and authority to
do and perform in the name and on behalf of the undersigned, in any and all
capacities, every act whatsoever necessary or desirable to be done in the
premises, as fully and to all intents and purposes as the undersigned might or
could do in person, the undersigned hereby ratifying and approving the acts that
said attorneys and each of them, or their or his substitutes or substitute, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this power of
attorney as of December 18, 1996.
/S/ CHARLES C. GATES
Charles C. Gates
<PAGE>
TEJAS GAS CORPORATION
POWER OF ATTORNEY
WHEREAS, TEJAS GAS CORPORATION, a Delaware corporation (the
"Company"), intends to file with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the "Securities
Act"), a Registration Statement or Registration Statements on Form S-8, with any
amendment or amendments thereto (including post-effective amendments) and any
supplement or supplements thereto (the "Registration Statement"), as prescribed
by the Commission pursuant to the Securities Act and the rules and regulations
of the Commission promulgated thereunder, in each case as may be necessary or
appropriate, together with any and all exhibits and other documents relating to
the Registration Statement in connection with the registration by the Company of
its Common Stock, par value $0.25 per share, issuable pursuant to the Tejas Gas
Corporation Employee Stock Option Plan, as amended.
NOW, THEREFORE, the undersigned in his capacity as a director or
officer or both, as the case may be, of the Company, does hereby appoint Jay A.
Precourt and James W. Whalen, and each of them severally, his true and lawful
attorney or attorneys with power to act with or without the other, and with full
power of substitution and resubstitution, to execute in his name, place and
stead, in his capacity as director, officer or both, as the case may be, of the
Company, the Registration Statement, including the exhibits thereto, and any
amendment or amendments thereto (including post-effective amendments) and any
supplement or supplements thereto and any and all instruments necessary or
incidental in connection therewith, as said attorney or attorneys shall deem
necessary or incidental in connection therewith, and to file the same with the
Commission and to appear before the Commission in connection with any matter
relating thereto. Each of said attorneys shall have full power and authority to
do and perform in the name and on behalf of the undersigned, in any and all
capacities, every act whatsoever necessary or desirable to be done in the
premises, as fully and to all intents and purposes as the undersigned might or
could do in person, the undersigned hereby ratifying and approving the acts that
said attorneys and each of them, or their or his substitutes or substitute, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this power of
attorney as of December 14, 1996.
/s/ A. J. MILLER
A. J. Miller
<PAGE>
TEJAS GAS CORPORATION
POWER OF ATTORNEY
WHEREAS, TEJAS GAS CORPORATION, a Delaware corporation (the
"Company"), intends to file with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the "Securities
Act"), a Registration Statement or Registration Statements on Form S-8, with any
amendment or amendments thereto (including post-effective amendments) and any
supplement or supplements thereto (the "Registration Statement"), as prescribed
by the Commission pursuant to the Securities Act and the rules and regulations
of the Commission promulgated thereunder, in each case as may be necessary or
appropriate, together with any and all exhibits and other documents relating to
the Registration Statement in connection with the registration by the Company of
its Common Stock, par value $0.25 per share, issuable pursuant to the Tejas Gas
Corporation Employee Stock Option Plan, as amended.
NOW, THEREFORE, the undersigned in his capacity as a director or
officer or both, as the case may be, of the Company, does hereby appoint Jay A.
Precourt and James W. Whalen, and each of them severally, his true and lawful
attorney or attorneys with power to act with or without the other, and with full
power of substitution and resubstitution, to execute in his name, place and
stead, in his capacity as director, officer or both, as the case may be, of the
Company, the Registration Statement, including the exhibits thereto, and any
amendment or amendments thereto (including post-effective amendments) and any
supplement or supplements thereto and any and all instruments necessary or
incidental in connection therewith, as said attorney or attorneys shall deem
necessary or incidental in connection therewith, and to file the same with the
Commission and to appear before the Commission in connection with any matter
relating thereto. Each of said attorneys shall have full power and authority to
do and perform in the name and on behalf of the undersigned, in any and all
capacities, every act whatsoever necessary or desirable to be done in the
premises, as fully and to all intents and purposes as the undersigned might or
could do in person, the undersigned hereby ratifying and approving the acts that
said attorneys and each of them, or their or his substitutes or substitute, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this power of
attorney as of December 14, 1996.
/s/ ROBERT G. STONE, JR.
Robert G. Stone, Jr.
<PAGE>
TEJAS GAS CORPORATION
POWER OF ATTORNEY
WHEREAS, TEJAS GAS CORPORATION, a Delaware corporation (the
"Company"), intends to file with the Securities and Exchange Commission (the
"Commission") under the Securities Act of 1933, as amended (the "Securities
Act"), a Registration Statement or Registration Statements on Form S-8, with any
amendment or amendments thereto (including post-effective amendments) and any
supplement or supplements thereto (the "Registration Statement"), as prescribed
by the Commission pursuant to the Securities Act and the rules and regulations
of the Commission promulgated thereunder, in each case as may be necessary or
appropriate, together with any and all exhibits and other documents relating to
the Registration Statement in connection with the registration by the Company of
its Common Stock, par value $0.25 per share, issuable pursuant to the Tejas Gas
Corporation Employee Stock Option Plan, as amended.
NOW, THEREFORE, the undersigned in his capacity as a director or
officer or both, as the case may be, of the Company, does hereby appoint Jay A.
Precourt and James W. Whalen, and each of them severally, his true and lawful
attorney or attorneys with power to act with or without the other, and with full
power of substitution and resubstitution, to execute in his name, place and
stead, in his capacity as director, officer or both, as the case may be, of the
Company, the Registration Statement, including the exhibits thereto, and any
amendment or amendments thereto (including post-effective amendments) and any
supplement or supplements thereto and any and all instruments necessary or
incidental in connection therewith, as said attorney or attorneys shall deem
necessary or incidental in connection therewith, and to file the same with the
Commission and to appear before the Commission in connection with any matter
relating thereto. Each of said attorneys shall have full power and authority to
do and perform in the name and on behalf of the undersigned, in any and all
capacities, every act whatsoever necessary or desirable to be done in the
premises, as fully and to all intents and purposes as the undersigned might or
could do in person, the undersigned hereby ratifying and approving the acts that
said attorneys and each of them, or their or his substitutes or substitute, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this power of
attorney as of December 14, 1996.
/s/ RONALD F. WALKER
Ronald F. Walker
