<PAGE>
Registration No. 333-_________
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
__________________
THE TIMKEN COMPANY
(Exact name of registrant as specified in its charter)
Ohio 34-0577130
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1835 Dueber Avenue, S.W., Canton, Ohio 44706-2798
(Address of principal executive offices including zip code)
THE HOURLY PENSION INVESTMENT PLAN
(Full title of the plan)
Larry R. Brown
Vice President and General Counsel
1835 Dueber Avenue, S.W.
Canton, Ohio 44706-2798
(Name and address of agent for service)
(330) 438-3000
(Telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
================================================================================
Proposed Proposed
Title of maximum maximum
securities Amount offering aggregate Amount of
to be to be price per offering registration
registered(1) registered share price fee
- -----------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock
without par value 150,000 shares $ 35.65625(2) $5,348,437.50(2) $1,620.74
=============================================================================
</TABLE>
(1) Pursuant to Rule 416(c) under the Securities Act of 1933, this registration
statement also covers an indeterminate amount of interests to be offered
pursuant to The Hourly Pension Investment Plan.
(2) Pursuant to Rule 457(h) under the Securities Act of 1933, this estimate is
made solely for the purpose of calculating the amount of the registration
fee and is based on the average of the high and low prices of the Common
Stock on the New York Stock Exchange on August 8, 1997.
<PAGE>
PART II
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents heretofore filed by The Timken Company (the
"Company") or The Hourly Pension Investment Plan, as amended (the "Plan"), with
the Securities and Exchange Commission are incorporated herein by reference:
(1) Annual Report of the Company on Form 10-K for the year ended
December 31, 1996;
(2) Annual Report of the Plan on Form 11-K for the year ended December
31, 1996;
(3) Quarterly Reports of the Company on Form 10-Q for the quarters
ended March 31, 1997, and June 30, 1997;
(4) Current Report of the Company on Form 8-K dated April 15, 1997;
and
(5) The description of the Company's common stock, without par value,
contained in the Company's Registration Statement filed pursuant
to Section 12 of the Securities Exchange Act of 1934 and any
amendments and reports filed for the purpose of updating that
description.
All documents that shall be filed by the Company or the Plan pursuant
to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934
subsequent to the filing of this registration statement and prior to the filing
of a post-effective amendment indicating that all securities offered under the
Plan have been sold or deregistering all securities then remaining unsold
thereunder shall be deemed to be incorporated herein by reference and shall be
deemed to be a part hereof from the date of filing thereof.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 1 of Article IV of the Company's Amended Code of Regulations
provides that the Company shall indemnify its directors, officers and employees,
and may indemnify its agents, to the fullest extent permitted by law under
prescribed conditions and subject to various qualifications. Article IV of the
Company's Amended Code of Regulations is set forth in Exhibit 4(b) hereto and is
incorporated herein by reference.
Reference is made to Section 1701.13(E) of the Ohio Revised Code
relating to indemnification of directors, officers, employees and agents of an
Ohio corporation.
The Company has entered into contracts with certain of its directors
and officers that indemnify them against many of the types of claims that may be
made against them. The company also maintains insurance coverage for the benefit
of directors and officers with respect to many types of claims that may be made
against them, some of which may be in addition to those described in Article IV
of the Company's Amended Code of Regulations.
ITEM 8. EXHIBITS.
4(a) Amended Articles of Incorporation of the Company (filed as
Exhibit 4(a) to the Company's Registration Statement No. 333-
02553 on Form S-8 and incorporated herein by reference)
(b) Amended Code of Regulations of the Company (filed as Exhibit 3.1
to the Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1992, and incorporated herein by reference)
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<PAGE>
(c) The Hourly Pension Investment Plan, as amended
5 Opinion of Counsel
23(a) Consent of Independent Auditors
(b) Consent of Counsel (included in Exhibit 5)
24 Power of Attorney
UNDERTAKING:
The undersigned registrant has submitted the Plan, and will
submit any amendments thereto, to the Internal Revenue Service and has
made or will make, as the case may be, all changes required by the
Internal Revenue Service in order to qualify the Plan.
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
- -------
registration statement is on Form S-3 or Form S-8, and 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 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(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
II-2
<PAGE>
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.
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 this registration statement 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 Canton, State of Ohio, on
this 14th day of August 1997.
THE TIMKEN COMPANY
By: /s/ GENE E. LITTLE
--------------------------------------
Gene E. Little
Vice President - Finance
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<PAGE>
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
---------- ----- ----
<S> <C> <C>
*W. R. Timken, Jr. Chairman - Board of August 14, 1997
- ----------------------------
W. R. Timken, Jr. Directors; Director
*Joseph F. Toot, Jr. President and Chief August 14, 1997
- ----------------------------
Joseph F. Toot, Jr. Executive Officer;
Director (Principal
Executive Officer)
*Gene E. Little Vice President - August 14, 1997
- ----------------------------
Gene E. Little Finance (Principal
Financial and
Accounting Officer)
*Robert Anderson Director August 14, 1997
- ----------------------------
Robert Anderson
*Stanley C. Gault Director August 14, 1997
- ----------------------------
Stanley C. Gault
*J. Clayburn LaForce, Jr. Director August 14, 1997
- ----------------------------
J. Clayburn LaForce, Jr.
*Robert W. Mahoney Director August 14, 1997
- ----------------------------
Robert W. Mahoney
*Jay A. Precourt Director August 14, 1997
- ----------------------------
Jay A. Precourt
*John M. Timken, Jr. Director August 14, 1997
- ----------------------------
John M. Timken, Jr.
*Ward J. Timken Director August 14, 1997
- ----------------------------
Ward J. Timken
*Martin D. Walker Director August 14, 1997
- ----------------------------
Martin D. Walker
*Charles H. West Director August 14, 1997
- ----------------------------
Charles H. West
*Alton W. Whitehouse Director August 14, 1997
- ----------------------------
Alton W. Whitehouse
</TABLE>
II-4
<PAGE>
* This registration statement has been signed on behalf of the above-named
directors and officers of the Company by Gene E. Little, Vice President -
Finance of the Company, as attorney-in-fact pursuant to a power of attorney
filed with the Securities and Exchange Commission as Exhibit 24 to this
registration statement.
/s/ GENE E. LITTLE
DATED: August 14, 1997 By:----------------------------------------
Gene E. Little, Attorney-in-Fact
II-5
<PAGE>
The Plan. Pursuant to the requirements of the Securities Act of 1933, the
--------
Plan has duly caused this registration statement to be signed on its behalf by
the undersigned, thereunto duly authorized, in the City of Canton, State of
Ohio, on this 14th day of August 1997.
THE HOURLY PENSION INVESTMENT PLAN
By: /s/ GENE E. LITTLE
---------------------------------------
Gene E. Little
Vice President - Finance
of The Timken Company
II-6
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Exhibit Description
- ------ -------------------
<S> <C>
4(a) Amended Articles of Incorporation of the Company
(filed as Exhibit 4(a) to the Company's
Registration Statement No. 333-02553 on Form S-8
and incorporated herein by reference)
4(b) Amended Code of Regulations of the Company
(filed as Exhibit 3.1 to the Company's Annual
Report on Form 10-K for the fiscal year ended
December 31, 1992, and incorporated herein by
reference)
4(c) The Hourly Pension Investment Plan, as amended
5 Opinion of Counsel
23(a) Consent of Independent Auditors
23(b) Consent of Counsel (included in Exhibit 5 hereto)
24 Power of Attorney
</TABLE>
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<PAGE>
EXHIBIT 4(c)
THE HOURLY
----------
PENSION INVESTMENT PLAN
-----------------------
The Timken Company Pension Plus Stock Plan for Certain Hourly Employees in
Ohio was effective January 1, 1990, and thereafter amended November 26, 1991 and
November 4, 1992. It was then further amended, restated, and renamed The Ohio
Hourly Pension Investment Plan, effective January 1, 1994. Additional
amendments were made effective January 1, 1994.
The Timken Company Pension Plus Stock Plan for Certain Hourly Employees in
North and South Carolina was effective January 1, 1990, and thereafter amended
November 26, 1991 and November 4, 1992. It was then further amended, restated,
and renamed The Carolina Pension Investment Plan, effective January 1, 1993.
The Plan was further amended effective January 1, 1994. Additional amendments
were made effective January 1, 1994.
The Latrobe Steel Company Pension Plus Stock Plan for Certain Hourly
Employees of Various Divisions was effective July 1, 1990, and thereafter
amended January 1, 1992 and August 14, 1992. It was then further amended,
restated, and renamed The Koncor Investment Pension Plan, effective January 1,
1994. Additional amendments were made effective January 1, 1994.
The provisions of the January 1, 1994 amendments and restatements relating
to the qualification of the Plans were generally
<PAGE>
effective January 1, 1990 (July 1, 1990 for Employees covered by the Koncor
Investment Pension Plan), except as otherwise specified herein, or to the extent
later effective dates were provided by the Tax Reform Act of 1986, the Omnibus
Budget Reconciliation Act of 1986, the Omnibus Budget Reconciliation Act of
1987, the Technical and Miscellaneous Revenue Act of 1988, the Omnibus Budget
Reconciliation Act of 1989, the Unemployment Compensation Amendments of 1992,
and the Omnibus Budget Reconciliation Act of 1993. Further, to the extent the
Plans were operated in accordance with the provisions of these amendments and
restatements as of an effective date earlier than that required by law, such
date was the Effective Date. All other provisions of these amendments and
restatements solely relating to the administration and operation of the Plans,
excluding all provisions that relate to and affect the qualification of the
Plans in form, were generally effective January 1, 1994.
Effective March 31, 1995, the Koncor Investment Pension Plan and the
Carolina Pension Investment Plan were merged into The Ohio Hourly Pension
Investment Plan and that Plan was renamed The Hourly Pension Investment Plan.
Additional amendments were made effective April 1, 1995. Additional amendments
were made
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<PAGE>
effective January 1, 1996. Additional amendments were made effective November
13, 1996 and January 1, 1997.
ARTICLE I. - Definitions
--------- -----------
The following terms, when used herein, shall have the meanings herein
stated:
1. "ACCOUNT," the account maintained for a Participant to record his share
of the contributions to the Plan and adjustments relating thereto. Each
Participant's Account shall have four (4) subaccounts, one (1) each for Wage
Reduction Contributions, Company Matching Contributions, Base Contributions and
Rollover Contributions.
2. "ACCRUED BENEFIT," the balance of a Participant's Account held under
the Trust.
3. "ADMINISTRATIVE DELEGATE", one or more persons or institutions to whom
the Company has delegated certain administrative functions pursuant to a
written administrative agreement.
4. "BENEFICIAL INTEREST," the proportionate allocation of assets held by
the Plan in the name of the Trust on behalf of each Participant, which
allocation is determined each business day for each Participant by the ratio of
total contributions to the Plan
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<PAGE>
made on the Participant's behalf compared to the total contributions to the Plan
made on behalf of all Participants.
5. "BENEFICIAL LOAN INTEREST," the market value of the assets representing
the Participant's Beneficial Interest in Pretax Con Contributions to the Trust
whether made by the Company or by a Participant, in the custody of the Trustee
as of any Valuation Date, determined for Timken stock by the market price for
such common stock, as reported by the New York Stock Exchange, on any Valuation
Date and for other investment options by the market value on the most recent
Valuation Date immediately preceding the date of the loan.
6. "BENEFICIARY," the person last designated by a Participant to receive
any benefits as provided herein. This designation shall be in writing on a form
supplied by the Plan Administrator and filed with the Plan Administrator prior
to the Participant's death. Beneficiaries designated under the Plan prior to
April 1, 1995, will remain as Beneficiaries until changed by Participants.
7. "BENEFIT STARTING DATE," the first day of the first period for which a
benefit is payable.
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<PAGE>
8. "BREAK IN SERVICE," any Plan Year during which an employee has not
completed more than 500 Hours of Service. A break in service shall not be
deemed to have occurred:
(a) during the first twelve (12) calendar months of an Employee's service
merely because of the failure to complete 500 Hours of Service during
any one Plan Year occurring in part during such 12 month period, if
the Employee completes 1,000 Hours of Service during such 12 month
period;
(b) during any period of excused absence, if the Employee returns to the
service of the Company within the time permitted pursuant to the leave
of absence;
(c) during absence for military service in the Armed Forces of the United
States, providing the Employee returns to work within the time
permitted by law for reinstatement of veterans, as then in force; or
(d) during a Plan Year because an Employee fails to complete more than 500
hours of service solely because of his or her retirement or death
during such Plan Year.
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<PAGE>
9. "CODE," The Internal Revenue Code of 1986, as amended, or any successor
Internal Revenue Code.
10. "COMPANY," The Timken Company and/or Latrobe Steel Company, and any
successor, as well as all members of a controlled group of corporations or
commonly controlled trades or businesses (as defined in Section 414(b) and (c)
of the Code, as modified by Section 415(h) of the Code) or affiliated service
groups (as defined in Section 414(m) of the Code) of which the Company is a
part, any or all of the above entities being sometimes referred to as
"Controlled Group Member(s)".
11. "CONTINUOUS SERVICE," an Employee's employment with the Company
measured from the date his employment commences until the time of his retirement
or death or until he incurs a Break in Service.
12. "EMPLOYEE," a person who is compensated on an hourly basis and
employed by the Company at its facilities in Bucyrus, Ohio, in North or South
Carolina, in Koncor Industries Division or as a brickmason at one of its Ohio
plants, but excluding any employee (a) who is in a collective bargaining unit
which has a deferred compensation plan other than this Plan which has been the
subject of collective bargaining or (b) who is a part-time employ-
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<PAGE>
ee. A part-time employee is one who has less than 1,000 Hours of Service in a
year. A leased employee shall not be considered an Employee, except for purposes
of the coverage tests under Section 410(b)(1) of the Code. A leased employee is
any person who is not an employee of the Company and who provides services to
the Company if (a) such services are provided pursuant to an agreement between
the Company and any leasing organization, (b) such person has performed such
services for the Company on a substantially full-time basis for a period of at
least one year, and (c) such services are performed under primary direction or
control by the Company. An employee who is a non-resident alien and who receives
no earned income from the Company, which constitutes income from sources within
the United States, shall not be considered an Employee. A person shall become an
Employee on the day he first completes an Hour of Service for the Company.
13. "ERISA," Public Law No. 93-406, the Employment Retirement Income
Security Act of 1974, as amended from time to time.
14. "FIDUCIARIES," the Company, the Plan Administrator and the Trustee, but
only with respect to the specific responsibilities of each for Plan and Trust
administration.
15. "HIGHLY COMPENSATED EMPLOYEE", any Employee who:
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<PAGE>
(a) was at any time during the current Plan Year or the preceding Plan Year
a five percent (5%) owner of the Company's outstanding common stock, or
(b) received compensation during the preceding Plan Year from the Company
in excess of $80,000 (or, if greater, the dollar limitation in effect under
Section 414(q)(1)(B) of the Internal Revenue Code) and, if the Company so
elects, was in the top-paid group (the top twenty percent (20%) of employees
ranked on the basis of compensation received during the year, but excluding any
Employee described in Section 414(q)(5) and Q & A 9(b) of Section 1.414(q)-1T of
the Treasury Regulations) of employees for such year.
For purposes of this definition, compensation is compensation within the
meaning of Section 415(c)(3) of the Code, including elective or wage reduction
contributions to a cafeteria plan, cash or deferred arrangement or tax-sheltered
annuity.
A former Employee shall be considered a Highly Compensated Employee, if he
separates from service (or was deemed to do so) prior to the year for which the
determination is made, performed no service for the Company during such
determination year, and was a Highly Compensated Employee for either the year in
which he sep-
-8-
<PAGE>
arated from service or any determination year ending on or after his 55th
birthday.
16. "HOUR OF SERVICE," each hour (a) for which an Employee is paid or
entitled to payment for the performance of duties for the Company or for which
he is paid, or entitled to payment, by the Company on account of a period of
time during which no duties are performed (irrespective of whether the
employment relationship has terminated) due to vacation, holiday, illness,
incapacity (including disability), layoff, jury duty, military duty or leave of
absence or (b) for which back pay, irrespective of mitigation of damages, is
either awarded or agreed to by the Company, which hours shall be credited to the
Employee for the computation period or periods to which the back pay award or
agreement pertains rather than for the period or periods in which the award or
agreement is paid or due. Hours of Service shall include hours which an
Employee would have been scheduled to work during a period with respect to which
the Employee is properly receiving sickness and accident benefits or workers'
compensation benefits whether paid by the Company, an insurance carrier under a
contract with the Company, or a state worker's compensation fund, but shall not
include any period to which is attributable severance pay or
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<PAGE>
unemployment compensation and any period for which a payment is made solely to
reimburse the Employee for medical or medically-related expenses. An Employee is
not required to be credited on account of a period during which no duties are
performed with a number of Hours of Service which is greater than the number of
hours regularly scheduled for the performance of duties during such period.
Hours shall be calculated and credited pursuant to Section 2530.200b-2 of the
Department of Labor Regulations which are hereby incorporated by reference.
In the case of an Employee who is absent from work for any period by reason
of:
(a) the pregnancy of the Employee,
(b) the birth of a child of the Employee,
(c) the placement of a child with the Employee in connection with the
adoption of a child by such Employee, or
(d) caring for such child for a period beginning immediately following
such birth or placement,
the Plan shall treat as Hours of Service, solely for purposes of determining
whether a one year Break in Service has occurred, Hours of Service which
otherwise would normally have been credited
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<PAGE>
to such Employee but for such absence, or in any case in which the Plan is
unable to determine the Hours of Service, eight Hours of Service per day of such
absence; provided, that the total number of hours treated as Hours of Service by
reason of any such pregnancy or placement shall not exceed 501 hours. These
hours shall be treated as Hours of Service only in the Plan Year in which the
absence from work begins, if an Employee would be prevented from incurring a one
year Break in Service in such Plan Year solely because periods of absence are
treated as Hours of Service or in any other case, the immediately following Plan
Year.
Hours of Service will be credited for employment with other members of an
affiliated service group (under Section 414(m) of the Code), a controlled group
of corporations (under Section 414(b) of the Code) or a group of trades or
businesses under common control (under Section 414(c) of the Code) of which the
Company is a member, and any other entity required to be aggregated with the
Company pursuant to Section 414(o) of the Code and the regulations thereunder.
17. "INCOME," the net gain or loss of the Trust from investments, as
reflected by interest received and accrued, dividends received, realized and
unrealized gains and losses on securities,
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<PAGE>
other investment transactions and expenses paid from the Trust. In determining
the income of the Trust for any period, assets shall be valued on the basis of
their current market value.
18. "LATROBE", Latrobe Steel Company, a fully-owned subsidiary of the
Company, and any successor.
19. "NORMAL RETIREMENT AGE," the later of the time a Participant attains
sixty-five (65) years of age or the fifth anniversary of the time participation
commenced.
20. "NORMAL RETIREMENT DATE," the first day of the first calendar month
following a Participant's attainment of Normal Retirement Age.
21. "PARTICIPANT," any Employee of the Company who meets the requirements
of Article II hereof.
22. "PLAN," The Hourly Pension Investment Plan as herein set forth and as
it may be amended and restated from time to time.
23. "PLAN ADMINISTRATOR," The Timken Company or any individuals or entities
designated by it to administer the Plan.
24. "PLAN YEAR", a period which includes all pay periods for which payment
is made in a calendar year.
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<PAGE>
25. "POOLED INVESTMENT ACCOUNT", an account established pursuant to an
administrative services agreement between the Company and the Trustee.
26. "PRETAX CONTRIBUTIONS TO THE TRUST," the portion of the Trust
representing (a) Wage Reduction Contributions and Company Matching Contributions
made after January 1, 1994 for Employees of the Company's Bucyrus, Ohio
facility, brickmason Employees at its Ohio plants and Employees of the Company's
Koncor Industries Division, and income thereon; (b) Wage Reduction Contributions
and Company Matching Contributions made after January 1, 1993 for Employees of
the Company's North and South Carolina facilities, and income thereon; (c)
contributions from the Company made prior to January 1, 1994 for Employees of
the Company's Bucyrus, Ohio facility, brickmason Employees at its Ohio plants
and Employees of the Company's Koncor Industries Division, and income thereon,
except that contributions for Employees of the Company's New Philadelphia plant
shall not be included and shall be transferred to The Timken Company-Latrobe
Steel Company Savings and Investment Pension Plan Trust; (d) contributions from
the Company made prior to January 1, 1993 for Employees of the Company's North
and South Carolina facilities, and income thereon; (e) Base Contributions
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<PAGE>
from the Company made after December 31, 1993 for Employees of the Company's
Bucyrus, Ohio facilities, brickmason Employees at its Ohio plants and Employees
of the Company's Koncor Industries Division, and income thereon; (f) Base
Contributions from the Company made after December 31, 1992 for Employees of the
Company's North and South Carolina facilities, and income thereon; and (g)
Rollover Contributions to the Trust made pursuant to Article III, Section 4.
27. "ROLLOVER CONTRIBUTION", All or part of a distribution a Participant
receives from a qualified trust described in Section 401(a) of the Code and
exempt from taxation under Section 501(a) of the Code, from an annuity plan
described in Section 403(a) of the Code, or from an individual retirement
account or an individual retirement annuity described in Section 408 of the
Code, including any earnings on such distribution, but not including any portion
of such distribution attributable to post-tax contributions, which is
contributed to the Trust.
28. "TIMKEN", The Timken Company and any successor thereof.
29. "TRUST," the trust established in connection with the Plan which holds
and invests the Pretax Contributions, which are to be distributed hereunder to
eligible Participants.
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<PAGE>
30. "TRUSTEE," that individual or institution appointed by the Company to
be the Trustee of the contributions to the Trust as provided herein, or their
successors.
31. "VALUATION DATE," any day that the New York Stock Exchange is open for
business and any other date chosen by the Company to make additional valuations
of the Trust Fund as necessary.
32. "WAGES," amounts paid by the Company to a Participant for personal
services for hours worked that are paid, including wage reduction contributions
to a cafeteria plan, incentive pay and cost of living adjustments, but excluding
jury duty, witness pay and similar compensation. For purposes of this Plan, and
in accordance with Section 401(a)(17) of the Code, Wages cannot exceed $150,000
(as adjusted) for a Plan Year.
33. "YEAR OF SERVICE," a twelve month period during which the employee has
not less than 1,000 Hours of Service. The initial twelve month period shall be
computed with reference to the day on which the Employee's employment commenced.
Subsequent twelve consecutive month periods shall be the Plan Year, commencing
with the Plan Year which includes the anniversary of the day on which employment
commenced. In the case of an Employee who does not
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<PAGE>
complete 1,000 Hours of Service during the twelve month period beginning on the
day his employment commenced, such computation shall be made by reference to the
first day of the following Plan Year which includes the anniversary of the day
on which employment commenced.
34. Masculine pronouns wherever used in the Plan shall include feminine or
neuter pronouns, and the singular shall include the plural wherever appropriate.
ARTICLE II. - Participation
---------- -------------
1. All Employees who are active Employees of the Company and who have
satisfied the eligibility terms for participation as of March 31, 1995, shall be
entitled to participate in the Plan as of March 31, 1995. The participation of
any Employee eligible thereafter to become a Participant shall commence
following completion of one calendar month of work (three calendar months of
work for Employees of the Company's North and South Carolina facilities and
Koncor Industries Division). A month of work is measured from the first day
that the Employee performs services for the Company until the corresponding day
of the next calendar month. Eligibility shall be determined and certified by
the Company.
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<PAGE>
2. Except as provided in Article II, Section 5, eligible Employees
electing to participate in this Plan for the first time or following a rehire to
active employment with the Company shall file a written election to do so, which
election will be effective with the first available pay period. Any other
election to participate or reparticipate may be accomplished by utilizing the
interactive voice response system, which election will be effective with the
first available pay period.
3. An Employee's election to participate in this Plan shall designate the
amount of wage reduction elected by the Employee to be contributed to this Plan,
as provided in Article III below. Such election shall become effective with the
first available pay period.
4. An Employee's election to participate in this Plan shall continue in
effect until the Employee utilizes the interactive voice response system to
terminate his participation or until such Employee ceases to be eligible to
participate in this Plan.
5. An Employee does not need to file a written election to participate in
the Company's Base Contribution.
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<PAGE>
6. If a Participant is reinstated by the Company, he shall recommence
participation in the Plan on the first day he is credited with an Hour of
Service for the Company.
ARTICLE III. - Wage Reduction Contributions and Rollover Contributions
----------- -------------------------------------------------------
1. At anytime, in accordance with Article II above, a Participant may
elect to have his wages reduced and the subsequent reduction contributed to this
Plan, in an amount equal to any whole percent between one percent (1%) and
fifteen percent (15%) of his Wages to be deducted from his Wages payable for
each pay period, except that a Participant at the Koncor Industries Division may
elect an amount equal to any whole percent between one percent (1%) and thirteen
percent (13%); provided, however, that the percent reduction selected cannot
result in more than a $9,500 Wage Reduction Contribution on behalf of a
Participant in a Plan Year (or, if greater, the dollar limitation in effect
under Section 402(g)(1) of the Code).
2. A Participant's election as to the rate of his Wage Reduction
Contributions to this Plan will remain in effect until the Participant changes
his election, ceases to be eligible to participate, or utilizes the interactive
voice response system or
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<PAGE>
through a customer service representative to terminate his participation in this
Plan.
3. A Participant may change his election as to the rate of Wage Reduction
Contributions to this Plan by utilizing the interactive voice response system or
through a customer service representative on any day. Such election shall
become effective as of the first available pay period. Any change made will be
effective for all succeeding pay periods, unless changed again by the same
procedure.
4. A Participant after filing with the Company or the Admin Administrative
Delegate the form prescribed by the Plan Administrator, may make a cash
contribution to the Trust in the form of a Rollover Contribution. Before
completing the Rollover Contribution, the Participant shall furnish satisfactory
evidence to the Plan Administrator that the proposed Rollover Contribution
satisfies the requirements of Section 408(d)(3) of the Code.
ARTICLE IV. - Company Matching Contributions
---------- ------------------------------
1. The Company will contribute to each Participant's Account in this Plan
an amount equal to:
(a) the Participant's Wage Reduction Contributions up to the first five
percent of the Participant's Wages multiplied by twenty
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percent (20%), for Employees of the Company's Bucyrus facility and brickmason
Employees at its Ohio plants;
(b) the Participant's Wage Reduction Contributions up to the first four
percent (4%) of the Participant's Wages multiplied by seventy percent (70%); and
effective January 1, 1996, the Participant's Wage Reduction Contributions up to
the first five percent (5%) of the Participant's Wages multiplied by eighty
percent (80%), for Employees of the Company's North and South Carolina
facilities; and
(c) the Participant's Wage Reduction Contributions up to the first five
percent (5%) of the Participant's Wages multiplied by twenty-five percent (25%),
for Employees of the Company's Koncor Industries Division.
These percentages may be changed from time to time by the Company.
2. The Company will contribute to each Participant's Account in this Plan
a Base Contribution for each calendar quarter. For an Employee to be eligible
for a Base Contribution, he must be actively employed by the Company and
eligible to participate at the beginning of the calendar quarter for which the
contribution is to be made. The contribution will be one percent
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<PAGE>
(1%) of a Participant's Wages for each calendar quarter in the Plan Year.
3. In no event shall the annual addition to a Participant's Account under
this Plan and any other qualified defined contribution plan maintained by the
Company exceed the lesser of $30,000 (or, if greater, one-fourth of the dollar
limitation in effect under Section 415(b)(1)(A) of the Code) or 25 percent of
the Participant's total compensation from the Company less the amount of Wage
Reduction Contributions. For purposes of this Article IV, Section 3 and the
subsequent sections in this Article IV, compensation is all amounts received by
a Participant from the Company during a Plan Year for the performance of
personal services, to the extent that such amounts are includable in taxable
income. In no event shall the amount of Wage Reduction Contributions to a
Participant's account exceed $9,500 for any Plan Year (or, if greater, the
dollar limitation in effect under Section 402(g)(1) of the Code).
The annual addition shall be the sum of the following amounts credited to a
Participant's Account for the limitation year:
(a) Company Matching Contributions,
(b) Wage Reduction Contributions,
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(c) Post Tax Employee Contributions and forfeitures, and
(d) amounts allocated, after March 31, 1984, to an individual medical
account, as defined in Section 415(c)(2) of the Code, which is a part of a
pension or annuity plan maintained by the Company. Amounts derived from
contributions paid or accrued after December 31, 1985, in taxable years ending
after such date, which are attributable to post-retirement medical benefits,
allocated to the separate account of a key employee, as defined in Section
419A(d) (3) of the Code, under a welfare benefit fund, as defined in Section
419(e) of the Code, maintained by the Company are also treated as annual
additions to a defined contribution plan.
For this purpose, any excess amount applied in the limitation year to
reduce Company contributions will be considered annual additions for such
limitation year.
In the event a corrective distribution is needed, following the end of the
calendar year, the Plan shall distribute such corrective distribution not later
than the first April 15 following the close of the calendar year. The income
(or loss) allocable to any excess Wage Reduction Contribution shall be
distributed as part of any corrective distribution.
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<PAGE>
4. If the annual addition limitation for any Participant would be
exceeded by the amounts contributed to this Plan and any other defined
contribution plans maintained by the Company, the Company contributions to the
Participant's Account made under this Plan shall be reduced as necessary, in the
following order: Company Matching Contributions, Wage Reduction Contributions
and Base Contributions.
5. If the Participant is or was formerly a participant in a defined
benefit plan maintained by the Company, the sum of the defined benefit plan
fraction and the defined contribution plan fraction for any Plan Year may not
exceed 1.0.
The defined benefit plan fraction is a fraction, the numerator of which is
the sum of the Participant's projected annual benefits under all defined benefit
plans (whether or not terminated) maintained by the Company, and the
denominator of which is the lesser of (a) 1.25 times the dollar limitation of
Section 415(b)(1)(A) of the Code in effect for the limitation year, or (b) 1.4
times the Participant's average compensation for the three consecutive years
that produce the highest average, including any adjustments under Section 415(b)
of the Code.
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<PAGE>
Notwithstanding the above, if the Participant were a participant as of the
first day of the first limitation year beginning after December 31, 1986, in one
or more defined benefit plans maintained by the Company which were in existence
on May 6, 1986, the denominator of this fraction will not be less than 125
percent of the sum of the annual benefits under such plans which the Participant
had accrued as of the close of the last limitation year beginning before January
1, 1987, disregarding any change in the terms and conditions of the plan after
May 5, 1986. The preceding sentence applies only if the defined benefit plans
individually and in the aggregate satisfied the requirements of Section 415 of
the Code for all limitation years beginning before January 1, 1987.
The defined contribution plan fraction is a fraction, the numerator of
which is the sum of the annual additions to the Participant's account under all
defined contribution plans maintained by the Company (whether or not terminated)
for the current and all prior limitation years, and the annual additions
attributable to all welfare benefit funds, as defined in Section 419(e) of the
Code, and individual medical accounts, as defined in Section 415(1)(2) of the
Code, and the denominator of which is the
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<PAGE>
sum of the lesser of the following amounts determined for such year and for each
prior Year of Service with the Company: (a) 1.25 times the dollar limitation in
effect under Section 415(c)(1)(A) of the Code for such year, or (b) 1.4 times
the amount which may be taken into account under Section 415(c)(1)(B) of the
Code.
The maximum aggregate amount in any limitation year is the lesser of 125
percent of the dollar limitation determined under Sections 415(b) and (d) of the
Code in effect under Section 415(c)(1)(A) of the Code or 35 percent of the
Participant's compensation for such year. If the Participant were a Participant
as of the end of the first day of the first limitation year beginning after
December 31, 1986, in one or more defined contribution plans maintained by the
Company which were in existence on May 6, 1986, the numerator of this fraction
will be adjusted if the sum of this fraction and the defined benefit fraction
would otherwise exceed 1.0 under the terms of this Plan. Under the adjustment,
an amount equal to the product of (1) the excess of the sum of the fractions
over 1.0 times (2) the denominator of this fraction, will be permanently
subtracted from the numerator of this fraction. The adjustment is calculated
using the fractions as they would be computed as of the
-25-
<PAGE>
last limitation year beginning before January 1, 1987, and disregarding any
changes in the terms and conditions of the Plan made after May 5, 1986, but
using the Section 415 limitation applicable to the first limitation year
beginning on or after January 1, 1987.
The annual addition for any limitation year beginning before January 1,
1987, shall not be recomputed to treat all Post Tax Employee Contributions as
annual additions.
6. If the sum of the defined contribution plan fraction and the defined
benefit plan fraction, as described in Article IV, Section 5, for a Participant
exceeds 1.0, the Participant's benefit under the defined benefit plan shall be
reduced accordingly.
7. If, as a result of the allocations of any forfeitures or errors in
estimating a Participant's compensation, the annual addition to a Participant's
Account exceeds the permissible amount, the excess will be disposed of as
follows:
(a) If the Participant is covered by the Plan at the end of the limitation
year, the excess amount in the Participant's Account will be used to reduce
Company contributions (including
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<PAGE>
any allocation of forfeitures) for such Participant in the next Plan Year and
each succeeding Plan Year if necessary.
(b) If the Participant is not covered by the Plan at the end of a Plan
Year, the excess amount will be held unallocated in a suspense account. The
suspense account will be applied to reduce Company Matching Contributions for
all remaining Participants in the next limitation year, and each succeeding year
if necessary.
(c) If a suspense account is in existence at any time during the Plan Year
pursuant to this Section, it will not participate in the allocation of the Trust
investment gain and losses. If a suspense account is in existence at any time
during a particular Plan Year, all amounts in the suspense account must be
allocated and reallocated to Participants' Accounts before any Company
contributions may be made to the Plan for that limitation year. Excess amounts
may not be distributed to Participants or former Participants.
(d) Any underpayments of Company contributions will be corrected by the
Company.
For purposes of this Article IV, Section 7, excess amounts attributable to
a specific type of contribution (Wage Reduction Contributions, Company Matching
Contributions or Base Contribu-
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<PAGE>
tions) may be utilized to reduce only a comparable contribution in the following
year.
8. The Accrued Benefit for each Participant in the Plan who has accrued
benefits as of December 31, 1993, who has at least one Hour of Service with the
Company in a Plan Year beginning after that date and whose Accrued Benefits were
determined taking into account compensation that exceeded the annual
compensation limit for any year, may be changed as set forth in this Section.
A Participant's Accrued Benefit under the Plan shall be equal to the
greater of
(a) the Participant's Accrued Benefit as of December 31, 1993 and his
accrued benefit determined under the formula and limitations
applicable to benefit accruals in the current plan year as applied to
Years of Service after December 31, 1993, or
(b) the Participant's Accrued Benefit determined under the formula and
limitations applicable to benefit accruals in the current Plan Year as
applied to the Participant's total Years of Service for the Company
before and after December 31, 1993.
ARTICLE V. - Interests Non-Forfeitable
--------- -------------------------
-28-
<PAGE>
Participants shall have an immediate fully vested and nonforfeitable right
to Wage Reduction Contributions, Company Matching Contributions, Base
Contributions and Rollover Contributions properly credited to their respective
subaccounts and the income attributable thereto.
-29-
<PAGE>
ARTICLE VI. - Operation of the Trust
---------- ----------------------
1. Except as provided in Sections 2 and 3 below, the Trust shall invest
100% of its funds in The Timken Company Common Stock Fund. The Company may, for
administrative purposes, establish unit values for one or more investment funds
(including Timken Company Common Stock) and maintain the Accounts setting forth
each Participant's interest in such investment fund (or portion thereof) in
terms of such units, all in accordance with fair, equitable and administratively
practicable rules and procedures as the Company shall design and adopt. Such
rules and procedures shall be set forth in a Pooled Investment Service Agreement
between the Company and the Trustee, which Agreement shall be incorporated by
reference and made a part of this Plan. In the event that unit accounting is
established for any investment fund (or portion thereof) the value of a
Participant's Account at any time shall be an amount equal to the then value of
a unit in such investment fund (or any portion thereof) multiplied by the number
of units then credited to the Participant.
2. Participants will be able to diversify the investment of their
Beneficial Interest. A Participant may choose to invest his Wage Reduction
Contributions, his Base Contributions and his
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<PAGE>
Rollover Contributions in Timken stock, or in other investment options offered
by the Company. At the time the Participant enrolls or re-enrolls in the Plan,
he may elect what percentage, if any, of his Wage Reduction Contributions, his
Base Contributions and his Rollover Contributions, in increments of five percent
(5%), he wishes to place in each investment option.
A Participant can request fund transfers on any business day of his prior
Wage Reduction Contributions, his Base Contributions and his Rollover
Contributions from one investment option to another by utilizing the interactive
voice response system or through a customer service representative. The
Participant may elect what percentage, if any, of those assets in the
Participant's Account eligible for transfer will be withdrawn in five percent
(5%) increments from existing investment options. The Participant may then
elect what percentage of the assets so withdrawn will be transferred to other
investment options in five percent (5%) increments. In order to effectuate a
transfer into or out of the fund holding Timken Stock, shares of Timken Stock
may be (a) bought and/or sold on the open market at the market price of the
stock on any Valuation Date, or (b) effective November 13, 1996, bought from
and/or sold to the Company at the
-31-
<PAGE>
average of the high and low market price on the Valuation Date the request is
received by the Company, if cash is not available. Company Matching
Contributions can be transferred to another investment option only under the
circumstances described in Paragraphs 3 and 4 below.
3. Participants who are active Employees and who have attained age 55 or
who have 30 Years of Service will be permitted to transfer all past Company
Matching Contributions, Wage Reduction Contributions, Base Contributions and
Rollover Contributions to the Trust to any investment option offered by the
Company. A Participant meeting the age and service requirements can request
investment transfers as described in Paragraph 2 above.
4. Participants who retired from the Company who have elected to retain
their distribution in the Plan pursuant to Article VII, Section 6 hereof will be
permitted to transfer all past Company Matching Contributions, Wage Reduction
Contributions, Base Contributions and Rollover Contributions to any investment
option offered by the Company, according to the procedures described in
Paragraph 2 above.
5. The Trustee shall, following the end of each Valuation Date, value all
assets of the Trust Fund, allocate net gains or
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<PAGE>
losses, and process additions to and withdrawals from Account balances in the
following manner:
a. The Trustee shall first compute the fair market value of securities
and/or the other assets comprising each investment fund designated by the
Company for direction of investment by the Participants of this Plan. Each
Account balance shall be adjusted each business day by applying the closing
market price of the in vestment fund on the current business day to the
share/unit balance of the investment fund as of the close of business on the
current business day.
b. The Trustee shall then account for any requests for additions or
withdrawals made to or from a specific designated investment fund by any
Participant, including allocations of contributions. In completing the
valuation procedure described above, such adjustments in the amounts credited to
such Accounts shall be made on the business day to which the investment activity
relates. Contributions received by the Trustee pursuant to this Plan shall not
be taken into account until the Valuation Date coinciding with or next following
the date such contribution was both actually paid to the Trustee and allocated
among the Accounts of Participants.
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<PAGE>
c. Notwithstanding Subsections a and b above, in the event a Pooled
Investment Fund is created as an investment option in this Plan, valuation of
the Pooled Investment Fund and allocation of earnings of the Pooled Investment
Fund shall be governed by the Administrative Services Agreement for such Pooled
Investment Fund. The provisions of any such Administrative Services Agreement
shall be incorporated by reference and made a part of this Plan.
It is intended that this Section operate to distribute among the
Participant's Accounts in the Trust Fund, all income of the Trust Fund and
changes in the value of the assets of the Trust Fund.
6. As soon as possible following the end of each calendar quarter, each
Participant shall receive a statement showing the details of the Participant's
Beneficial Interest in the Trust.
7. Investment fees attributable to a Participant's choice of a particular
investment option may be charged against the Partici pant's Account balance in
that investment option.
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<PAGE>
ARTICLE VII. - Distributions from the Trust
----------- ----------------------------
1. The shares and cash held in the Trust for the benefit of a Participant
shall be distributed to the Participant at the Participant's request upon
retirement at or after Normal Retirement Age, upon a Break in Service with the
Company or to the Participant's Beneficiary upon the death of the Participant,
except as hereinafter provided.
2. A Participant's Beneficiary shall be his or her spouse or, if the
Participant has no spouse or the Participant's spouse consents (in the manner
described in this Paragraph) to the designation of another person or persons,
such other person or persons as is designated by the Participant as his or her
Beneficiary. The Account balance shall be adjusted for gains and losses
occurring after the Participant's death in accordance with usual Plan procedures
for adjusting Account balances for other types of distributions.
A Participant may elect at any time to waive the surviving spouse as
Beneficiary and may revoke any such election at any time. Such an election
shall not take effect unless the spouse of the Participant consents in writing
to such election, such election designates a Beneficiary (or a form of benefits)
which
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<PAGE>
may not be changed without spousal consent (or the consent of the spouse
expressly permits designations by the Participant without any requirement of
further consent by the spouse) and the spouse's con sent acknowledges the effect
of such election and is witnessed by a Plan representative or a notary public,
or it is established to the satisfaction of the Plan Administrator that the
consent required may not be obtained because there is no spouse, because the
spouse cannot be located, or because of such other circumstances as the
Secretary of the Treasury may by regulations prescribe. Any consent by a spouse
(or establishment that the consent of a spouse may not be obtained) shall be
effective only with respect to such spouse.
In order to elect to waive his spouse as Beneficiary, a Participant also
must affirmatively elect that the payment of his benefits not be in the form of
a life annuity, and with respect to such Participant, this Plan may not be a
transferee of a defined benefit plan or an individual account plan subject to
the funding standards of the Internal Revenue Code or any other plan required to
provide a mandatory qualified joint and survivor annuity provision.
-36-
<PAGE>
If a Participant has no spouse, if the spouse has consented in the manner
described above to not being the designated Beneficiary, if the spouse cannot be
located, or because of other circumstances prescribed by the Secretary of the
Treasury, the Participant may, by written notice delivered to the Plan
Administrator, designate or change the designation of a Beneficiary to whom
payments of bene fits may be paid in the event of his death. In the absence of
such notice, such benefits shall, to the extent permitted by law, be paid at the
discretion of the Company to the deceased Participant's surviving spouse, child
or children, parent or parents, and/or the executor or administrator of his
estate.
3. A Participant or Beneficiary entitled to a distribution from the Trust
shall receive certificates for the full shares of Timken stock held for his or
her benefit and cash for any fraction al interests in shares and investments in
other investment options. Timken stock shall be valued by using the closing
price of such stock on any Valuation Date. Other investment options shall be
valued by using the market value on the most recent Valuation Date immediately
preceding the date of distribution.
-37-
<PAGE>
4. Such distributions shall be made in a lump sum as soon as possible
following completion of a distribution request form after the Participant
retires, the Participant's death occurs, a Break in Service occurs or a hardship
withdrawal is processed. Notwithstanding the foregoing, unless the Participant
otherwise elects, distribution to a Participant will be made no later than the
sixtieth (60th) day after the close of the Plan Year in which the Break in
Service occurs. If the distribution exceeds $3,500 or if the account balance of
the Participant ever exceeded $3,500 at the time of a prior distribution, it
cannot be distributed without the written consent of the Participant and the
Participant's spouse, if any, or in cases where the Participant is dead, the
Participant's surviving spouse or Beneficiary (if the surviving spouse is not
the beneficiary).
For distributions made from the Plan, the appropriate tax withholdings will
be made, unless the Participant instructs the Plan Administrator, pursuant to
procedures to be implemented by the Plan Administrator, to roll over directly
his eligible rollover distribution to an eligible retirement plan. A direct
rollover is a payment by the Plan to the eligible retirement plan specified by
the Participant. An eligible rollover distribution
-38-
<PAGE>
is any distribution of all or any portion of the balance to the credit of the
Participant, except that an eligible rollover distribution does not include (a)
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 Participant or the joint lives (or joint life expectancies)
of the Participant and the Participant's designated beneficiary, or for a
specified period of ten (10) years or more; (b) any distribution to the extent
such distribution is required under Section 401(a)(9) of the Internal Revenue
Code; and (c) the portion of any distribution that is not includable in gross
income (determined without regard to the exclusion for net unrealized
appreciation with respect to employer securities). An eligible retirement plan
is an individual retirement account described in Section 408(a) of the Internal
Revenue Code, an individual retirement annuity described in Section 408(b) of
the Internal Revenue Code, an annuity plan described in Section 403(a) of the
Internal Revenue Code, or a qualified trust described in Section 401(a) of the
Internal Revenue Code, that accepts the Participant's eligible rollover
distribution. However, in the case of an eligible rollover distribution to the
surviving spouse, an
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<PAGE>
eligible retirement plan is an individual retirement account or individual
retirement annuity. For purposes of this provision, a Participant includes an
Employee or former Employee, a Participant's surviving spouse and a
Participant's spouse or former spouse who is the alternate payee under a
qualified domestic relations order, as defined in Section 414(p) of the Internal
Revenue Code.
Participants and Beneficiaries will also have the option to receive a
distribution in installments. The Participant or Beneficiary may elect the
frequency of the distribution which may be monthly, quarterly or annually over a
period not to exceed the recipient's life expectancy. A Participant must have a
minimum Account balance of $1,000 to elect installment distribution. After
installment payments begin, when the Account balance becomes $1,000 or less, the
entire balance will be distributed in a lump sum payment.
If distribution of benefits has commenced before the Participant's death,
the remaining benefits will be distributed at least as rapidly as under the
method of distribution being used as of the date of the Participant's death. If
the Participant dies before the distribution of benefits has commenced, the
remaining
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<PAGE>
portion of the Participant's interest that is not payable to a Beneficiary
designated by the Participant shall be distributed within five (5) years after
the Participant's death; provided, that the five-year rule shall not apply to
any portion of the Participant's interest payable to a Beneficiary designated by
the Participant, if the remaining interest will be distributed over the life of
such Beneficiary (or over a period of time not greater than said Beneficiary's
life expectancy), commencing not later than one year after the Participant's
death (or, if the designated Beneficiary is the Participant's surviving spouse,
commencing not later than the date on which the Participant would have attained
age 70 1/2).
5. Unless the Participant otherwise elects, the payment of benefits to a
Participant shall begin not later than the sixtieth (60th) day after the latest
of the close of the Plan Year in which (a) the Participant attains age sixty-
five (65), (b) the Participant completes ten (10) years of Continuous Service,
or (c) the Participant terminates his service with the Company. The election to
postpone the payment of benefits beyond the time specified above shall be made
by submitting to the Company a written statement, signed by the Participant,
which describes the benefit
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<PAGE>
and the date on which the payment of such benefit shall commence. Such an
election may not be made if the exercise of such election will cause the
benefits payable under this Plan in the event of the death of the Participant to
be more than incidental.
In no event shall payment of such benefits be deferred beyond April 1 of
the calendar year following the calendar year in which a Participant who is a
five percent (5%) owner (as defined in Section 416 of the Code) attains age 70-
1/2. For a Participant who is not a five percent (5%) owner, the payment of
benefits shall not be deferred beyond April 1 of the calendar year following the
later of the calendar year in which the Participant attains age 70 1/2 or the
calendar year in which the Participant retires.
If distributions are required to be made under this Article VII, Section 5,
they shall be made in a lump sum payment or in installment payments, if the
Participant so elects. The requirements of this Article VII, Section 5 shall
apply to any distribution of a Participant's interest and will take precedence
over any inconsistent provisions of this Plan. All distributions required under
this Article VII, Section 5 shall be determined and made in accordance with the
proposed regulations under Section
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<PAGE>
401(a)(9) of the Code, including the minimum distribution incidental benefit
requirement of Section 1.401(a)(9)-2 of the proposed regulations. The amount to
be distributed each year, beginning with distributions for the first
distribution calendar year shall not be less than the quotient obtained by
dividing the Participant's benefit by the lesser of (a) the applicable life
expectancy or (b) if the Participant's spouse is not the designated beneficiary,
the applicable divisor determined from the table set forth in Q & A-4 of Section
1.401(a)(9)-2 of the Proposed Regulations. Distributions after the death of the
Participant shall be distributed using the applicable life expectancy set forth
above as the relevant divisor without regard to proposed regulations Section
1.401(a)(9)-2.
The minimum distribution required for the Participant's first distribution
calendar year must be made on or before the Participant's required beginning
date. The minimum distribution for other calendar years, including the minimum
distribution for the distribution calendar year in which the Participant's
required beginning date occurs, must be made on or before December 31 of that
distribution calendar year.
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<PAGE>
If distribution of benefits has commenced prior to the Participant's death,
the remaining interest under the Plan will be distributed at least as rapidly as
under the method of distribution being used as of the date of the Participant's
death.
If distribution of benefits hereunder has not commenced at the time of
the Participant's death, any portion of the Participant's interest in the Plan
that is not payable to a Beneficiary designated by the Participant over a period
not exceeding the Participant's life expectancy will be distributed within five
years after the Participant's death and any portion of the Participant's
interest that is payable to a Beneficiary designated by the Participant will be
distributed either (i) within five years after the Participant's death, or (ii)
over the life of the Beneficiary over a period certain not extending beyond the
life expectancy of the Beneficiary, commencing not later than the end of the
calendar year following the calendar year in which the Participant died (or, if
the designated Beneficiary is the Participant's surviving spouse, commencing on
or before the later of (a) December 31 of the calendar year immediately
following the calendar year in which the Participant died and (b) December 31 of
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the calendar year in which the Participant would have attained age 70 1/2).
6. A Participant otherwise entitled to a distribution from the Plan may
elect to retain said distribution in the Plan until such time as the Participant
shall direct the Company to make said distribution, provided that such
distribution must be made not later than the time specified in Article VII,
Section 5 above. Upon written notice (or by any other method approved by the
Company) from the Participant, such distribution shall be made as soon as
possible after the notice is received.
7. The assets of the Trust to be distributed to a Participant or
Beneficiary shall include any shares (or cash in lieu of fractional shares)
attributable to dividends payable to shareholders of record as of the end of
the quarter with respect to which the calculation is being made.
8. Partial or total distributions of the Participant's Wage Reduction
Contributions and/or Rollover Contributions may also be made to a Participant,
upon application to the Company, in cases of hardship. If a Participant elects
a withdrawal prior to the date he retires, becomes disabled or terminates his
service with the Company, such withdrawal will require the consent of the
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Trustee and such consent shall be given only if, under uniform rules and
regulations and in conformance with procedures established by the Company, the
Trustee determines that the purpose of the withdrawal is to meet immediate and
heavy financial needs of the Participant, the amount of the withdrawal does not
exceed such financial need, and the amount of the withdrawal is not reasonably
available from the resources of the Participant. If the Participant is married,
a distribution in excess of $3500 cannot be distributed without the written
consent of the Participant's spouse.
The determination of whether a Participant has an immediate and heavy
financial need will be made on the basis of all relevant facts and
circumstances. Financial needs which will be deemed immediate and heavy
financial need are the purchase of a primary residence (excluding mortgage
payments) of the Participant, payment of post-secondary educational tuition for
a year for the Participant or his dependents, health care expenses incurred by
a Participant or his dependents, and the need to prevent the eviction of the
Participant from his principal residence or foreclosure on the mortgage of a
Participant's principal residence.
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The determination of whether a distribution is necessary to satisfy an
immediate and heavy financial need shall be made on the basis of all relevant
facts and circumstances. A distribution will be deemed to satisfy an immediate
and heavy financial need if it is not in excess of the amount of the immediate
and heavy financial need of the Participant (grossed up to reflect the income
taxes that will be assessed on the distribution), the Participant has obtained
all distributions (other than hardship distributions) and all available
nontaxable loans under all plans maintained by the Company, the Participant
agrees that all Wage Reduction Contributions and all other Participant
contributions to all plans maintained by the Company will be suspended until
twelve (12) months after receipt of the hardship distribution, and the
Participant agrees that any Wage Reduction Contributions made in the taxable
year following the taxable year of the hardship distribution shall not exceed
the maximum limit under Section 402(g) of the Code less the amount of the
Participant's Wage Reduction Contributions for the taxable year of the hardship
distribution.
Such election may be made at any time, but not more frequently than once
every twelve months. All withdrawal
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<PAGE>
elections shall be made by a Participant on written forms supplied by the
Trustee for that purpose. Such distributions shall be processed immediately
following completion of the application procedures.
9. The Company may transfer a Participant's Account under the Plan to
another qualified defined contribution plan maintained by a Controlled Group
Member, when the Participant transfers employment from an employee group covered
by the Plan to an employee group not so covered, provided that the other plan
accepts such transfers. Accounts so transferred shall be subject to such
rights, restrictions, and features (including vesting provisions) applicable to
assets in similar accounts contributed to and held under the other plan. The
Plan Administrator may establish such nondiscriminatory restrictions and rules
applicable to such transfers as it may determine to be necessary or desirable to
maintain the qualified status of the Plan (and any other plan sponsored by it or
by a Controlled Group Member) under the Code; including, without limitation,
rules insuring that such transfers comply with Sections 411(a) and 411(d)(6) of
the Code and the regulations thereunder. In no event shall any amount be trans-
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ferred to the Trust from a defined benefit pension plan or a money purchase
pension plan.
When a Participant transfers employment from an employee group not covered
by the Plan to an employee group covered by the Plan and has otherwise satisfied
the eligibility requirements of the Plan, the Company may transfer the
Participant's account balance under another qualified defined contribution plan
maintained by a Controlled Group Member which authorizes such transfers to the
Plan. Transferred accounts shall be subject to such rights, restrictions and
features (including vesting provisions) applicable to assets in similar Accounts
contributed to and held under the Plan. The Plan Administrator may establish
such nondiscriminatory restrictions and rules applicable to such transfers from
the Plan and transfers to the Plan as it may determine to be necessary or
desirable to maintain the qualified status of the Plan and any other plan
sponsored by it or by a Controlled Group Member under the Code; including,
without limitation, rules insuring that such transfers comply with Section
411(a) and 411(d)(6) of the Code and the regulations thereunder.
ARTICLE VIII. - Equity Determination
------------ --------------------
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<PAGE>
1. The Company may amend or revoke the Wage Reduction Contribution
election of any Participant at any time, if the Company determines that such
revocation or amendment is necessary to insure that the annual addition to a
Participant's Account for any Plan Year will not exceed the limitations of
Article IV, Section 3 or to insure that the discrimination tests of Section
401(k) of the Code are met for such Plan Year. The discrimination tests shall
be (a) that the Employees eligible to benefit under this Plan shall satisfy the
nondiscrimination provisions of Section 410(b)(1) of the Code and (b) that the
actual deferral percentage for Highly Compensated Employees (as defined in
Article I, Section 15) for such Plan Year bears a relationship to the actual
deferral percentage for all other eligible Employees for the preceding Plan Year
which meets either of the following tests:
(a) the actual deferral percentage for the group of Highly Compensated
Employees is not more than the actual deferral percentage of all other
eligible Employees multiplied by 1.25, or
(b) the excess of the actual deferral percentage for the group of Highly
Compensated Employees over that of all other eligible Employees is not
more than two (2)
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percentage points, and the actual deferral percentage for the group of
Highly Compensated Employees is not more than the actual deferral
percentage of all other eligible Employees multiplied by two (2).
For purposes of this Section, the actual deferral percentage for a specified
group of Employees for a Plan Year shall be the average of the ratios
(calculated separately for each Employee in such group) of:
(a) the amount of Wage Reduction Contributions actually paid to the Trust
on behalf of each such Employee for such Plan Year, as well as any
Company Matching Contributions and any Base Contributions treated by
the Company as elective contributions, to
(b) the Employee's compensation (as defined in Section 414(s) of the Code)
for such Plan Year.
For purposes of determining whether the Plan satisfies the actual deferral
percentage test, all Wage Reduction Contributions, as well as any Company
Matching Contributions and any Base Contributions treated by the Company as
elective contributions that are made under two or more plans that are aggregated
for purpose of satisfying Sections 401(a)(4) and 410(b) of the Code (other than
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Section 410(b)(2)(A)(ii) of the Code), are to be treated as made under a single
plan. If two or more plans are permissively aggregated for purpose of
satisfying Section 401(k) of the Code, the aggregated plans must also satisfy
Sections 401(a)(4) and 410(b) of the Code as though they were a single plan. In
calculating the actual deferral percentage, the actual deferral ratio of a
Highly Compensated Employee will be determined by treating all plans subject to
Section 401(k) of the Code under which the Highly Compensated Employee is
eligible (other than those that may not be permissively aggregated) as a single
plan.
The Plan will take into account the actual deferral ratios of all eligible
Employees for purposes of the actual deferral percentages. For this purpose, an
eligible Employee is any Employee who is directly or indirectly eligible to make
Wage Reduction Contributions and includes any Employee who is unable to make
Wage Reduction Contributions because the Employee has not contributed to another
plan, any Employee whose right to make Wage Reduction Contributions has been
suspended because of a distribution, a loan, or an election not to participate
and any Employee who cannot make Wage Reduction Contributions because the
limitations imposed by Article IV, Sections 3 and 5, prevent the
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Employee from receiving additional annual additions. In the case of an eligible
Employee who makes no Wage Reduction Contributions, the actual deferral ratio
that is to be included in determining the actual deferral percentage is zero.
For purposes of the actual deferral percentage test and the determination
of excess contributions in Article VIII, Section 3, compensation shall be all
amounts received by a Participant from the Company during a Plan Year for the
performance of personal services, to the extent that such amounts are includable
in income.
2. The Company may amend or revoke the Wage Reduction Contribution
election of any Participant at any time, if the Company determines that such
revocation or amendment is necessary to insure that the discrimination tests of
Section 401(m) of the Code are met for such Plan Year. The discrimination tests
shall be that the actual contribution percentage for Highly Compensated
Employees (as defined in Article I, Section 15) for such Plan Year bears a
relationship to the actual contribution percentage for all other eligible
Employees for the preceding Plan Year which meets either of the following tests:
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(a) the actual contribution percentage for the group of Highly Compensated
Employees is not more than the actual contribution percentage of all
other eligible Employees multiplied by 1.25, or
(b) the excess of the actual contribution percentage for the group of
Highly Compensated Employees over that of all other eligible Employees
is not more than two (2) percentage points, and the actual
contribution percentage for the group of Highly Compensated Employees
is not more than the actual contribution percentage of all other
eligible Employees multiplied by two (2).
For purposes of this Section, the actual contribution percentage for a specified
group of Employees for a Plan Year shall be the average of the ratios
(calculated separately for each Employee in such group) of:
(a) the amount of Company Matching Contributions actually paid to the
Trust on behalf of each such Employee for such Plan Year, as well as
any wage reduction contributions and any Base Contributions, that are
treated by the Company as matching contributions to the Plan, to
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(b) the Employee's compensation (as defined in Section 414(s) of the Code)
for such Plan Year.
For purposes of determining whether the Plan satisfies the actual
contribution percentage test of Section 401(m) of the Code, all Matching
Contributions that are made under two or more plans that are aggregated for
purpose of Sections 401(a)(4) and 410(b) of the Code (other than Section
410(b)(2)(A)(ii) of the Code), are to be treated as made under a single plan. If
two or more plans are permissively aggregated for purposes of satisfying Section
410(m) of the Code, the aggregated plans must also satisfy Sections 401(a)(4)
and 410(b) of the Code as though they were a single plan. In calculating the
actual contribution percentage, the actual contribution ratio of a Highly
Compensated Employee will be determined by treating all plans subject to Section
401(m) of the Code under which the Highly Compensated Employee is eligible
(other than those that may not be permissively aggregated) as a single plan.
The Plan will take into account the actual contribution ratios of all
eligible Employees for purposes of the actual contribution percentages. For
this purpose, an eligible Employee is any Employee who is directly or indirectly
eligible to receive
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an allocation of Matching Contributions includes any Employee who would be a
Participant entitled to receive Matching Contributions but for his failure to
make Wage Reduction Contributions, any Employee whose right to receive Matching
Contributions has been suspended because of an election (other than certain one-
time elections) not to participate and any Employee who cannot receive a
Matching Contribution because the limitations imposed by Article IV, Sections 3
and 5, prevent the Employee from receiving additional annual additions. In the
case of an eligible Employee who receives no Matching Contributions, the actual
contribution ratio that is to be included in determining the actual contribution
percentage is zero.
For purposes of the actual contribution percentage test and the
determination of excess aggregate contributions in Article VIII, Section 4,
compensation shall be all amounts received by a Participant from the Company
during a Plan Year for the Performance of personal services, to the extent that
such amounts are includable in income.
3. In the event that the Plan should fail to meet the test set forth in
Article VIII, Section l, the amount of excess contributions for a Highly
Compensated Employee for a Plan Year is
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to be determined by the following leveling method, under which the dollar amount
of contributions by and on behalf of the Highly Compensated Employee with the
highest dollar amount of such contributions is reduced to the extent required to
(a) enable the arrangement to satisfy the actual deferral percentage test,
or
(b) cause such Highly Compensated Employee's dollar amount of such
contributions to equal the dollar amount of a Highly Compensated
Employee with the next highest dollar amount of such contributions.
This process must be repeated until the Plan satisfies the actual deferral
percentage test. For each Highly Compensated Employee, the amount of excess
contributions is equal to the total Wage Reduction Contribution, plus Company
Matching Contributions and Base Contributions treated as elective contributions,
on behalf of the Participant.
Excess contributions (and income allocable thereto) are distributed in
accordance with this Article VIII, Section 3, only if such excess contributions
(and allocable income) are designated by the Company as a distribution of excess
contributions (and income) and are distributed to the appropriate Highly
Compensated
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Employees after the close of the Plan Year in which the excess contributions
occurred and within twelve months after the close of such Plan Year.
A corrective distribution of excess contributions (and income) is
includable in gross income of the Participant on the earliest dates any Wage
Reduction Contributions by the Participant during the Plan Year would have been
received by the Participant had he originally elected to receive the amounts in
cash, or, if distributed more than two and a half months after the Plan Year for
which such contributions were made, in the taxable year of the Participant in
which distributed.
The amount of excess contributions to be distributed under this Article
VIII, Section 3 with respect to a Participant for a Plan Year shall be reduced
by any excess Wage Reduction Contribution elections under Article IV, Section 3
previously distributed to such Participant for the Participant's taxable year
ending with or within such Plan Year. The amount of excess Wage Reduction
Contribution elections that may be distributed under Article IV, Section 3 with
respect to a Participant for a calendar year shall be reduced by any excess
contributions previously distributed with
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respect to such Participant for the Plan Year beginning with or within such
calendar year. In the event of a reduction under this paragraph, the amount of
excess contributions includable in the gross income of the Participant and the
amount of excess contributions reported by the Company as includable in the
gross income of the Participant shall be reduced by the amount of the reduction
under this paragraph.
4. In the event that the Plan should fail to meet the test set forth in
Article VIII, Section 2, the amount of excess aggregate contributions for a
Highly Compensated Employee for a Plan Year is to be determined by the following
leveling method under which the dollar amount of contributions by and on behalf
of the Highly Compensated Employee with the highest dollar amount of such
contributions is reduced to the extent required to
(a) enable the Plan to satisfy the actual contribution percentage test, or
(b) cause such Highly Compensated Employee's dollar amount of such
contributions to equal the dollar amount of the Highly Compensated
Employee with the next highest dollar amount of such contributions.
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This process must be repeated until the Plan satisfies the actual
contribution percentage test. The amount of excess aggregate contributions with
respect to an Employee for a Plan Year shall be determined only after first
determining the excess contributions that are treated as Employee contributions
for the Plan Year due to recharacterization. For each Highly Compensated
Employee, the amount of excess aggregate contributions is equal to the total
Matching Contributions plus Wage Reduction Contributions and Base Contributions
treated as Matching Contributions, on behalf of the Participant.
Excess aggregate contributions (and income allocable thereto) are
distributed in accordance with this Article VIII, Section 4 only if such excess
aggregate contributions (and allocable income) are designated by the Company as
a distribution of excess aggregate contributions (and income) and are
distributed to the appropriate Highly Compensated Employees after the close of
the Plan Year in which the excess aggregate contributions occurred and within
twelve months after the close of the following Plan Year.
A corrective distribution of excess aggregate contributions (and income) is
includable in gross income for the taxable year of the Participant ending with
or within the Plan Year for which the
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excess aggregate contributions were made or, if distributed more than two and a
half months after the Plan Year for which such excess aggregate contributions
were made, in the taxable year of the Participant in which distributed.
5. If a multiple use of the alternative limitations described in Article
VIII, Sections 1 and 2 occurs with respect to the Plan, such multiple use shall
be prevented as to any Highly Compensated Employee according to the provisions
of Section 1.401(m)-2(b) of the Treasury Regulations. Such multiple use shall
be corrected by reducing the dollar amount of contributions by and on behalf of
all Highly Compensated Employees. The amount of the reduction to the dollar
amount of such contributions of all Highly Compensated Employees shall be
calculated in the manner described in Article VIII, Section 4. The required
reduction shall be treated as an excess aggregate contribution under the Plan.
ARTICLE IX. - Loans from the Trust
---------- --------------------
1. A Participant or alternate payee who has succeeded to the interest of a
Participant, may obtain a loan from the Trust upon proper application to the
Trust pursuant to procedures established by the Company. For purposes of this
Article IX, the
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term "Participant" shall include an alternate payee described in the preceding
sentence. The nature and amount of the loan must conform to the following rules
and limits:
(a) The Participant may borrow only from Pretax Contributions (including
Base Contributions and Rollover Contributions) to the Trust in the
custody of the Trustee;
(b) The minimum loan amount is $1,000;
(c) The maximum loan amount is 50 percent of the Participant's Beneficial
Loan Interest, provided, that no loan may be greater than $50,000,
reduced by the excess (if any) of (1) the highest outstanding loan
balance from the Plan during the one year period ending on the day
before the date on which such loan is made over (2) the outstanding
loan balance from the Plan on the date on which such loan is made.
The Trustee will accept only the Participant's accrued benefit as
collateral for loans.
(d) The term of the loan cannot exceed 5 years, except that the term of a
loan made for the purpose of purchasing a primary residence cannot
exceed 30 years, provided that
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the term of a loan made for any purpose can not extend beyond the
Participant's attainment of age 70-1/2.
(e) A Participant may have only one loan from this Plan in effect at any
one time and may apply for only one loan within each twelve month
period.
(f) The Company will establish the rate of interest to be charged on all
loan balances. This rate of interest will be one percent (1%) in
excess of the prime rate as published in the Wall Street Journal the
first business day of the month in which the loan is granted.
(g) The loan shall be repaid by the Participant, if the Participant is an
active Employee, through payroll deduction as established by the loan
agreement. If the borrower is not an active Employee, the borrower
and the Company shall agree to a repayment schedule which shall be
incorporated in the loan agreement.
(h) The loan may be repaid in full at a date earlier than provided in the
loan agreement with no penalty.
(i) Interest paid by the Participant in excess of the loan fees, if any,
will be credited directly to the Participant's account.
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(j) Any loan fees charged will be paid by the Participant from funds other
than those in the Trust.
(k) The loan amount will be taken on a pro-rata basis from the Beneficial
Loan Interest in all investment options at the time of the loan and on
a pro-rata basis from Company and Participant contributions at the
time of the loan. Repayments will be redeposited into the
Participant's current investment options and contributions using the
current ratio, except for amounts which must be reinvested in
Timken Company Stock.
(l) If a Participant or Beneficiary does not repay a loan which he or she
may have from the Plan, the Trustee will declare such loan to be in
default when the loan is in arrears of repayment for more than 90
days. The Trustee may take steps to preserve Plan assets, if
necessary, in the event of such default. Once default has been estab
lished, the amount o(Pounds) the loan in default (unpaid prin cipal
and the interest accrued thereon) shall be treated as a distribution
from the Plan in the Plan Year in which the default occurs. The
amount of
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the default will not constitute part of subsequent distributions from
the Trust.
(m) The proceeds of the loan cannot be applied toward the purchase of any
securities.
(n) Loan repayments will be suspended under this Plan as permitted under
Section 414(u) of the Code.
2. Loans may be applied for on any business day and will be processed
immediately. Loan application shall be made through the interactive voice
response system except that any loan whose term extends beyond five (5) years
must be on a written application form available from and returned to the
Trustee.
3. The rules and limits for this loan provision may be changed from time
to time to comply with the Code and with regulations issued thereunder.
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ARTICLE X. - Voting of Shares Held by the Trustee
--------- ------------------------------------
Each Participant, each Beneficiary who has succeeded to the interest of a
Participant and each alternate payee ("Eligible Participants and Beneficiaries")
in this Plan shall have the authority to direct the exercise of voting rights as
to whole shares of Timken stock held for the benefit of the Eligible Participant
or Beneficiary as of the most current Valuation Date available preceding the
record date for the shareholders' meeting. The Trustee shall furnish Timken's
Annual Report, Notice of Annual Meeting, Proxy Statement, Proxy Card and other
shareholder information to each Eligible Participant and Beneficiary and shall
solicit each Eligible Participant's and Beneficiary's vote; the Company reserves
the option to retain the Trustee to perform these services. All other shares of
Timken stock held in the Trust, including shares not voted by Eligible
Participants or Beneficiaries or not yet allocated to Eligible Participants or
Beneficiaries, are to be voted by the Trustee in the same ratio for the election
of Directors and for or against each issue as the applicable votes directed by
Eligible Participants and Beneficiaries with respect to whole shares of Timken
stock.
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ARTICLE XI. - Merger, Consolidation or Transfer
---------- ---------------------------------
In case of any merger or consolidation with, or transfer of assets or
liabilities to, any other plan, the benefits which would be paid to each
Participant in this Plan (if this Plan terminated immediately after the merger,
consolidation, or transfer) shall be equal to or greater than the benefit each
Participant would have been entitled to receive immediately before the merger,
consolidation, or transfer (if this Plan had then terminated).
ARTICLE XII. - Conditions to the Effectiveness and
----------- ------------------------------------
Continuance of this Plan
------------------------
1. The Company will not be required to make any contributions to the
Trust required to be established under this Plan or to place any part of the
Plan into operation, unless and until it shall have received from the Internal
Revenue Service a currently effective ruling or rulings, satisfactory to the
Company, that such Trust is a qualified Trust under Sections 401(a), 401(k) and
401(m) of the Code, and exempt from Federal Income Tax under Section 501(a) of
the Code. Continued contributions to the Trust and operation of the Plan shall
be conditioned upon retaining such favorable ruling or rulings from the Internal
Revenue Service.
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2. The Company will not be required to make any contributions to the
Trust required to be established under this Plan or to place any part of the
Plan into operation, unless and until it shall have received from the United
States Department of Labor a currently effective ruling or rulings, satisfactory
to the Company that no part of the Company's contributions to such Trust shall
be included in the regular rate of pay of any Employee. Continued contributions
to the Trust and operation of the Plan shall be conditioned upon retaining such
favorable ruling or rulings.
3. In the event the Plan fails to qualify initially under the applicable
provisions of the Code, the Company's contributions shall be returned to the
Company. Contributions to the Trust by the Company are conditioned on their
deductibility under Section 404(a) of the Code. If any deduction is disallowed
for all or part of such contributions, the contributions for which the deduction
is disallowed shall, upon proper notice to the Trustee, be returned to the
Company.
ARTICLE XIII. - Amendment or Termination of Plan
------------ --------------------------------
1. The Company expects to continue this Plan indefinitely, but reserves
the right to terminate the Plan or to amend the Plan in any other respect and in
any manner that it may deem advisable.
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The Board of Directors of Timken has authorized and instructed its Vice-
President - Human Resources and Logistics (or any other officer or delegate of
an officer, except the Administrative Delegate) to amend or terminate the Plan.
Any such amendment shall be in writing. Upon delivery of written notice from
Timken to the Trustee, the Plan and Trust Agreement shall be deemed to have been
terminated or amended in the manner set forth therein, and all Participants and
all persons claiming any interest hereunder shall be bound thereby; provided
that no termination or amendment:
(a) shall have the effect of vesting in the Company any interest in any
property held subject to the terms of the Plan;
(b) shall cause or permit any property held subject to the terms of the
Plan to be diverted to purposes other than the exclusive benefit of
Participants and their Benefi ciaries, including contributions to the
Plan which are intended to bridge any differences between the price at
which Company stock is bought and/or sold on the open market and the
price at which it is credited to a Participant's account;
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(c) shall reduce the interest of a Participant in the Trust property as of
that time or his or her right to enjoy such interest without the
written consent of the Participant;
(d) shall increase the duties or liabilities of the Trustee without its
written consent.
2. Without terminating this Plan, the Company may, at its sole
discretion, at any time prior to the end of a Plan Year, reduce or suspend its
contributions to this Plan.
3. In the event of termination or partial termination of the Plan or a
complete discontinuance of contributions, the Participants, retired
Participants, former Participants and Beneficiaries of deceased Participants,
and alternate payees shall have a fully vested interest in the amounts credited
to their respective Accounts at the time of such termination, partial
termination or discontinuance.
4. Upon the termination of the Plan and Trust, after proportional
adjustment of the Accounts to reflect losses or profits and reallocations to the
date of termination, each Participant, retired Participant, former Participant
and Beneficiary of a deceased Participant, and alternate payees shall
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be entitled to receive any amounts then credited to his Account in the Trust.
Distribution of such amounts shall be made upon the Participant's attainment of
age 59-1/2, or if earlier, the termination of his employment with the Company.
5. In the event that amendments to this Plan are necessary or desirable
for the purpose of (a) obtaining a favorable ruling by the Internal Revenue
Service concerning the qualification of or any matter arising under this Plan,
(b) clarifying any ambiguity, correcting any apparent error, or supplying any
omission from the provisions of this Plan, or (c) facilitating or improving the
administration of this Plan, such amendments may be made by the Company;
provided that no such amendment shall adversely affect any of the rights of
Participants or prospective Participants in this Plan, nor impose additional
obligations on the Company, or relieve the Company of any obligations prescribed
hereby.
6. The Board of Directors of Timken may delegate its duties and
responsibilities with respect to the Plan to such officer or officers (or their
designees, except the Administrative Delegate) as the Board of Directors may
determine and may allocate to and among any one or more of such officers such
duties and
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responsibilities, including the power to amend the Plan in any manner or suspend
or modify the level of Company contributions to the Plan.
ARTICLE XIV. - Nonalienation of Participants' Interests
----------- ----------------------------------------
1. No right to the monies contributed by a Participant or the Company under
this Plan, nor in any shares held by the Trustee, nor any dividends thereon,
shall be subject in any manner to alienation, assignment, encumbrance, pledge,
sale or transfer of any kind prior to being distributed to the Participant as
provided in the Plan. However, the Trustee is granted in the Trust Agreement the
authority to recover any Trustee fees and expenses as agreed to by the Company
and the Trustee. If at any time prior thereto a Participant shall attempt to
alienate, assign, encumber, pledge, sell or otherwise transfer his right to any
shares or monies held by the Trustee, such attempted alienation, assignment,
encumbrance, pledge, sale or transfer shall be of no effect. To the extent
permitted by law, the interest of a Participant shall also be protected from
involuntary attachment, garnishment or levy. In the event of an attempted
attachment, garnishment or levy of the Participant's interest in the Trust, the
Participant will be promptly notified; but the
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Trustee shall have no obligation to resist such action. In no event shall any
person be entitled to the distribution of shares or the payment of monies held
by the Trustee prior to the time when distribution is to be made to the
Participant as provided in the Plan.
2. Section 1 of this Article XIV shall not apply if the attachment or
garnishment of the Participant's interest in the Trust is to be made pursuant to
a qualified domestic relations order, as determined under the procedures of this
Plan. A domestic relations order is a judgment, decree or order that relates to
the provision of child support, alimony payments or marital property rights to a
spouse, former spouse, child or other dependent of a Participant and is made
pursuant to a state domestic relations law. A domestic relations order is
qualified if it creates or recognizes the existence of an alternate payee's
right to, or assigns to an alternate payee the right to, receive all or a
portion of the benefits payable to a Participant under the Plan, specifies (a)
the name and last known mailing address of the Participant and of each alternate
payee covered under the order, (b) the amount or percent age of the
Participant's benefits to be paid to any alternate payee, or the manner in
which such
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amount or percentage is to be determined, (c) the number of payments or the
period to which the order applies, and (d) each plan to which the order relates.
Such order cannot require the Plan to provide any type or form of bene fits, or
any option, not otherwise provided under the Plan; it cannot require the Plan to
provide increased benefits (determined on the basis of actuarial value), and it
cannot require the payment of benefits to an alternate payee which are required
to be paid to another alternate payee under another order previously determined
to be a qualified domestic relations order.
3. Each alternate payee under a qualified domestic relations order shall
have the right from time to time to file with the Company a written request
regarding the time and manner of payment of the alternate payee's interest in
the Plan pursuant to such qualified domestic relations order. Provided such
qualified domestic relations order complies with the Code, such request shall be
considered by the Company and shall be acted upon in accordance with the terms
of such qualified domestic relations order. The options available to an
alternate payee shall be those set forth in Article VII, Section 4, unless
otherwise modified by the qualified domestic relations order, provided that said
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qualified domestic relations order cannot enlarge the options available under
Article VII, Section 4. If an alternate payee so desires, distribution of an
alternate payee's interest in the Trust may be distributed to such alternate
payee, as soon as such qualified domestic relations order is approved by the
Company and by the court.
ARTICLE XV. - Tender Offers
- ---------- -------------
1. In the event a tender offer (as determined by the Board of Directors
of the Company) for shares of common stock of Timken is commenced, then,
notwithstanding any other provision of the Plan or the Trust Agreement, each
Participant, each Beneficiary who has succeeded to the interest of a Participant
and each alternate payee ("Affected Participants and Beneficiaries") shall, in
accordance with the following provisions of this Article, have the right to
decide if Timken Company common stock credited to his or her account shall be
tendered.
2. In the event of a tender offer described in Section 1 of this Article,
the Company shall cause to be sent to each Affected Participant and Beneficiary
who at any time during the effective period of the tender offer has any Timken
stock credited to his account all information pertinent to such tender offer,
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including all the terms and conditions thereof, together with written material
pursuant to which the Affected Participant and Beneficiary may direct the
Trustee to tender or sell pursuant to the tender offer all or part of the Timken
stock credited to his Account. Affected Participants and Beneficiaries also
shall have the right, to the extent the terms of the tender offer so permit, to
direct the withdrawal of such shares from the tender. The Trustee shall tender
or sell only those shares of Timken stock as to which valid and timely
directions to tender or sell are received and not validly and timely revoked,
and all other shares of Timken stock held under the Plan shall continue to be
held by the Trustee. If, in the course of a tender offer described in Section 1
of this Article, an issue shall arise on which Affected Participants and
Beneficiaries are required to have an opportunity to alter their circumstances,
Timken shall solicit the directions of such Affected Participants and
Beneficiaries with respect to each such issue and act in response to such
direction. The Trustee shall adopt a deadline, after which directions to tender
(or to withdraw from tender) Timken stock will not be accepted, sufficiently in
advance of any applicable deadline under the terms
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of the tender offer to allow the Trustee to implement directions received from
Affected Participants and Beneficiaries.
3. To the extent that a tender offer described in Section 1 of this
Article is for cash, proceeds from the sale of any shares of Timken stock
pursuant to such offer shall be held by the Trustee in an interest bearing
account or in short-term government bonds acquired by the Trustee upon the
receipt of any such cash proceeds. To the extent that a tender offer described
in Section 1 of this Article is for property other than cash, property received
by the Trustee from the sale of any shares of Timken stock pursuant to such
offer shall be held by the Trustee in a general investment fund established by
the Trustee upon the receipt of any such property.
4. Any decision by an Affected Participant or Beneficiary to tender (or
not tender) or to sell (or not sell), and any other direction by an Affected
Participant or Beneficiary, pursuant to this Article shall constitute an
exercise of control by such Affected Participant or Beneficiary over the assets
allocated to his or her account within the meaning of section 404(c) of ERISA.
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ARTICLE XVI. - Top-Heavy Provisions
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1. Definitions. For the purposes of this Article XVI, the following
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definitions shall apply:
(a) "Key Employee" means an Employee or former Employee who at any time
during the Plan Year containing the Determination Date or during the
four preceding Plan Years is:
(1) an officer of the Company having an annual compensation greater
than 50 percent of the amount in effect under Section
415(b)(1)(A) of the Code for any such Plan Year;
(2) an owner (or considered the owner within the meaning of Section
318 of the Code) of one of the largest interests in the Company,
if such individual's annual compensation exceeds 100% of the
limitation in effect under Section 415(c)(1)(A) of the Code;
(3) a five percent (5%) owner of the Company; or
(4) a one percent (1%) owner of the Company who has an annual
compensation above $150,000.
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For purposes of determining the number of officers taken into account
under clause (1) above, Employees described in Section 414(q)(8) of
the Code will be excluded. For purposes of clause (2) above, if two
Employees have the same interest in the Company or any affiliated or
subsidiary Company, the Employee having greater annual compensation
from the Company or any affiliated or subsidiary Company shall be
treated as having a larger interest. For purposes of this subsection,
annual compensation is all amounts received by a Participant from the
Company during a Plan Year for the performance of personal services,
including amounts deferred under Wage Reduction Agreements. "Key
Employee" shall also include such Employee's beneficiary in the event
of his death.
The definition of Key Employee shall be interpreted in accordance
with Section 416(i) of the Code and the rules and regulations
promulgated thereunder. Any employee who does not meet the
requirement of this definition shall be considered a non-key employee.
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(b) "Determination Date" means the last day of the preceding Plan Year.
2. Top-Heavy Determination. This Plan shall be top-heavy for any Plan
-----------------------
Year if, as of the Determination Date, the aggregate of the Accounts of Key
Employees under the Plan exceeds 60 percent of the aggregate of the Accounts of
all Employees under the Plan. For purposes of this determination, the following
rules shall apply:
(a) Employees shall include former Employees, Beneficiaries and former
Beneficiaries who have a benefit greater than zero on the
Determination Date.
(b) The amount of the account of any Employee shall be increased by the
aggregate distributions made with respect to such Employee within the
5-year period ending on the Determination Date.
(c) The Account of any Employee who is not a Key Employee as of the
Determination Date but who was a Key Employee during any prior Plan
Year shall be disregarded.
(d) If an Employee has not performed services for the Company at any time
during the five (5) year period ending on the Determination Date, any
accrued benefit
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for such Employee (and account of such Employee) shall not be taken
into account.
(e) If the Company maintains other plans which are qualified under Section
401 of the Code, the top-heavy determination described above shall be
made by aggregating the Accounts under this Plan with the accounts or
the present values of the cumulative accrued benefits under (1) any
such other plan (including plans terminated in the past 5 years) in
which a Key Employee is a participant and (2) any such other plan
(including plans terminated in the past 5 years) which enables a
of Section 401(a)(4) or Section 410 of the Code. The Company may also
aggregate any such other plans not required to be aggregated, provided
the resulting group of plans, taken as a whole, continue to meet the
requirements of Sections 401(a)(4) and 410 of the Code.
(f) The Accrued Benefit of any Employee (other than a Key Employee) shall
be determined by the method used for accrual purposes for all plans of
the Company.
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(g) The top-heavy determination under this Paragraph shall be made in
accordance with Section 416 of the Code and the rules and regulations
promulgated thereunder.
3. Top-Heavy Requirements: If the Plan is deemed to be top heavy under
----------------------
Paragraph 2 then, notwithstanding any other provision of the Plan to the
contrary, the following shall apply with respect to each Plan Year in which the
Plan is top-heavy:
(a) Minimum Contributions: The Company contributions for each Participant
---------------------
who is not a Key Employee shall not be less than three percent (3%) of
such Participant's compensation or the largest percentage of the
Company contributions, as a percentage of a Key Employee's
compensation allocated on behalf of any Key Employee for that year,
provided if the highest rate allocated to a Key Employee is less than
three percent (3%), amounts contributed as a result of Wage Reduction
Agreements must
be included in determining the contributions made on behalf of Key
Employees. For purposes of this Subsection and in accordance with
Section 401(a)(17) of the Code, compensation cannot exceed $150,000
(as adjusted) for a Plan Year. This
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minimum allocation shall be made even though, under other Plan
provisions, the Participant would not otherwise be entitled to receive
an allocation, or would have received a lesser allocation for the year
because of (1) the Participant's failure to complete 1,000 Hours of
Service or (2) the Participant's failure to make mandatory Employee
contributions to the Plan, provided, however, this provision shall not
apply to any Participant who was not an Employee on the last day of
the Plan Year. Company contributions allocated under any other defined
contribution plan of the Company, in which any Key Employee
participates or which enables another defined contribution plan to
meet the requirements of Section 401(a)(4) or 410 of the Code, shall
be considered contributions and forfeitures allocated under this Plan.
In the case of any non-key employee Participant who is also a
Participant in any defined benefit plan of the Company, the foregoing
provisions of this section shall be applied, but with five percent
(5%) substituted for three percent (3%) .
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(b) Adjusted Code Section 415 Limitations. In order to reduce the overall
-------------------------------------
limitations on combined plan contributions and benefits under Section
415 of the Code, the number 1.00 shall be substituted for 1.25 in the
definitions of defined contribution fraction and defined benefit
fraction in Article IV, Section 5 of the Plan. The foregoing sentence
shall not apply if (1) the top-heavy ratio is 90% or less and (2) each
non-Key Employee receives an additional minimum contribution or
benefit under a Plan of the Company. In the case of a non-Key Employee
participating only in a defined benefit plan, the additional minimum
benefit for each Year of Service counted is one percentage point, up
to a maximum of ten percentage points, of the Employee's average
compensation for the five consecutive years when the Employee had the
highest aggregate compensation from the Company. In the case of a non-
Key Employee participating only in this or another defined
contribution plan, the additional minimum contribution is one percent
of the Employee's compensation. In the case of a Non-Key Employee
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participating both in a defined benefit plan and this or another
defined contribution plan, there is no additional minimum benefit, but
the additional minimum contribution shall be two and one-half percent
(2-1/2%) of the Employee's compensation.
(c) Plan Compensation: For any Plan Year in which the Plan is a top-heavy
-----------------
plan, annual compensation taken into account under the Plan shall not
exceed $150,000. Annual compensation is all amounts received by a
Participant from the Company during a Plan Year for the performance of
personal services, to the extent that such amounts are includable in
gross income.
ARTICLE XVII. - Plan Administration
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1. Timken shall be the Plan Administrator and have responsibility for
the administration of this Plan, including power to construe this Plan, to
determine all questions that shall arise hereunder, including particularly
questions on eligibility and participation of Employees and allocations of
Company contributions to Participants' Accounts and all matters necessary for it
properly to discharge its duties, powers and obligations and to apply its
established policies concerning the employment
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status of Participants. The decision of Timken made in good faith upon any
manner within the scope of its authority shall be final, but Timken at all times
in carrying out its decisions shall act in a uniform and nondiscriminatory
manner and may from time to time set down uniform rules of interpretation and
administration, which rules may be modified from time to time in the light of
its experience.
2. Timken will make all determinations as to the right of any persons to
benefits under the Plan. Any denial by Timken of a claim for benefits under the
Plan by a Participant or beneficiary will be stated in writing by Timken and
delivered or mailed to the Participant or Beneficiary. Such notice will set
forth the specific reasons for the denial and the plan provision on which the
denial is based. If additional information is needed to perfect a claim, a
Participant or Beneficiary shall be so informed. In addition, Timken will
provide an opportunity to any Participant or Beneficiary whose claim for
benefits has been denied an opportunity for review of the denial. As part of the
review, the Participant or Beneficiary will be permitted to (a) view all Plan
documents and other papers which affect the claim,
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(b) argue the denial of benefits in writing and (c) have a representative if he
or she so desires.
3. Timken may from time to time authorize and instruct certain of its
Employees to perform any and all acts, deeds and other matters required to be
performed by Timken under the Plan and the Trust Agreement. Timken has so
authorized and instructed that its Vice President - Human Resources and
Logistics or any other officer or the delegate of an officer (except the
Administrative Delegate) may sign any and all documents on behalf of the Plan.
4. Timken may, from time to time, retain the services of one or more
persons or firms designated as an Investment Manager for the management of
(including the power to acquire and dispose of) all or any part of the Trust,
provided that each of such persons or firms is registered as an investment
advisor under the Investment Advisors Act of 1940, is a bank (as defined in that
Act), or an insurance company qualified to perform, manage, acquire or dispose
of trust assets under the laws of more than one State of the United States.
Each such Investment Manager shall acknowledge in writing that it is a fiduciary
with respect to the assets of the Trust under its authority and management.
Timken
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may by similar notice modify or terminate such designation and authority from
time to time. So long as and to the extent that any designation is in effect,
the Trustee shall invest and reinvest that portion of the Trust assigned to an
Investment Manager in accordance with the instructions received from such
Investment Manager, and, with respect to such portion of the Trust managed by
such Investment Manager, shall follow any instructions received by it from such
Investment Manager. The Trustee shall be under no duty to review the investments
made or held in any portion of the Trust over which an Investment Manager has
been given investment authority nor shall it be under any obligation to invest
or otherwise manage any assets of the Trust which are subject to the management
of such Investment Manager or Managers. Such assets shall expressly be held by
such Investment Manager as custodian of such assets.
5. Timken shall also have the authority and discretion to engage an
Administrative Delegate who shall perform, without discretionary authority or
control, administrative functions within the framework of policies,
interpretations, rules, practices, and procedures developed by Timken. Any
action made or taken by the Administrative delegate may be appealed by an
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affected Employee or Beneficiary to Timken in accordance with the claims review
procedures provided in Section 2 of this Article. Any decisions which call for
interpretations of Plan provisions not previously made by Timken shall only be
made by Timken. The Administrative Delegate shall not be considered a fiduciary
with respect to the services it provides.
ARTICLE XVIII. - Veterans' Rights
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1. A Participant who is reemployed by the Company pursuant to the
provisions of the Uniformed Services Employment and Reemployment Rights Act of
1994 shall be treated as not having incurred a Break in Service with the Company
by reason of such Participant's period or periods of service in the armed forces
of the United States. Each period served by a Participant in the armed forces
shall, upon reemployment, be deemed to constitute service with the Company for
purposes of determining the nonforfeitability of benefits and the accrual of
benefits under the Plan.
2. Effective December 12, 1994, the Company upon reemploying a Participant
with respect to a period of service with the armed forces shall allocate the
amount of any Company contribution, including a Base Contribution, for the
participant in the same
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manner and to the same extent the allocation occurs for other Participants
during the period of service. For purposes of determining the amount of any such
allocation, earnings shall not be included.
3. A Participant so reemployed shall be entitled to Accrued Benefits that
are contingent on the making of, or derived from Wage Reduction Contributions
only to the extent such Participant makes payment to the Plan with respect to
such Wage Reduction Contributions. No such payment may exceed the amount the
Participant would have been permitted to contribute had the Participant remained
continuously employed by the Company through the period of service in the armed
forces. Any payment of Wage Reduction Contributions to the Plan shall be made
during the period beginning with the date of reemployment and whose duration is
three times the period of the Participant's service in the armed forces, not to
exceed a maximum duration of five years.
4. For purposes of computing the Company's Matching Contributions, Wage
Reduction Contributions and Base Contributions under Sections 2 and 3 above, the
Participant's Wages during the period of service in the armed forces shall be
computed at the rate the Participant would have received, but for the period of
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service in the armed forces, or, in the case that the determination of such rate
is not reasonably certain, on the basis of the Participant's average Wages from
the Company during the twelve month period immediately preceding such period of
service in the armed forces, or if shorter, the period of employment immediately
preceding such period of service in the armed forces.
5. 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.
EXECUTED by The Timken Company at Canton, Ohio on December _____, 1996,
effective January 1, 1997, except as specifically provided.
THE TIMKEN COMPANY
By _________________________________
Title: Vice President - Human
Resources and Logistics
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EXHIBIT 5
August 14, 1997
The Timken Company
1835 Dueber Avenue, S.W.
Canton, Ohio 44706-2798
Re: The Hourly Pension Investment Plan, As Amended
----------------------------------------------
Ladies and Gentlemen:
We have acted as counsel to The Timken Company, an Ohio corporation
(the "Company"), in connection with the filing of a registration statement on
Form S-8 (the "Registration Statement") to register under the Securities Act of
1933, as amended, an additional 150,000 shares of the Company's common stock
without par value ("Common Stock") to be issued or transferred and sold under
The Hourly Pension Investment Plan, as amended (the "Plan"). We have examined
such documents, records and matters of law as we have deemed necessary for the
purposes of this opinion, and based thereon, we are of the opinion that the
shares of Common Stock that may be issued or transferred and sold by the Company
to the Trustee (as defined in the Plan) pursuant to the Plan will be, when
issued or transferred and sold in accordance with the Plan, duly authorized,
validly issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as Exhibit 5 to the
Registration Statement.
Very truly yours,
Jones, Day, Reavis & Pogue
<PAGE>
Exhibit 23(a)
Consent of Independent Auditors
We consent to the incorporation by reference in the Registration Statement on
Form S-8 pertaining to The Hourly Pension Investment Plan of our reports (a)
dated February 6, 1997, with respect to the consolidated financial statements
and schedule of The Timken Company included in its Annual Report (Form 10-K) and
(b) dated June 9, 1997, with respect to the financial statements and schedules
of The Hourly Pension Investment Plan included in the Plan's Annual Report (Form
11-K), both for the year ended December 31, 1996, filed with the Securities and
Exchange Commission.
ERNST & YOUNG LLP
Canton, Ohio
August 11, 1997
<PAGE>
EXHIBIT 24
DIRECTORS AND OFFICERS OF
THE TIMKEN COMPANY
REGISTRATION STATEMENT ON FORM S-8
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each of the undersigned directors
and officers of The Timken Company, an Ohio corporation (the "Company"), hereby:
(1) constitutes and appoints W.R. Timken, Jr., Joseph F. Toot, Jr., Gene E.
Little and Larry R. Brown, collectively and individually, as his agent and
attorney-in-fact, with full power of substitution and resubstitution, to (a)
sign and file on his behalf and in his name, place and stead in any and all
capacities (i) a Registration Statement on Form S-8 (the "Registration
Statement") with respect to the registration under the Securities Act of 1933,
as amended, of participation interests issuable under The Hourly Pension
Investment Plan and up to 150,000 shares of the Company's Common Stock, without
par value, for issuance under the Plan, (ii) any and all amendments, including
post-effective amendments, and exhibits to the Registration Statement and (iii)
any and all applications or other documents to be filed with the Securities and
Exchange Commission or any state securities commission or other regulatory
authority with respect to the securities covered by the Registration Statement,
and (b) do and perform any and all other acts and deeds whatsoever that may be
necessary or required in the premises; and (2) ratifies and approves any and all
actions that may be taken pursuant hereto by any of the above-named agents and
attorneys-in-fact or their substitutes.
IN WITNESS WHEREOF, the undersigned directors and officers of the
Company have hereunto set their hands as of the 1st day of August, 1997.
/s/ Robert Anderson /s/ Ward J. Timken
------------------- ------------------
Robert Anderson Ward J. Timken
/s/ Stanley C. Gault /s/ W.R. Timken
-------------------- ---------------
Stanley C. Gault W.R. Timken, Jr.
/s/ J. Clayburn LaForce, Jr. /s/ Joseph F. Toot, Jr.
---------------------------- -----------------------
J. Clayburn LaForce, Jr. Joseph F. Toot, Jr.
/s/ Gene E. Little /s/ Martin D. Walker
------------------ --------------------
Gene E. Little Martin D. Walker
/s/ Robert W. Mahoney /s/ Charles H. West
--------------------- -------------------
Robert W. Mahoney Charles H. West
/s/ Jay A. Precourt /s/ Alton W. Whitehouse
------------------- -----------------------
Jay A. Precourt Alton W. Whitehouse
/s/ John M. Timken, Jr.
-----------------------
John M. Timken, Jr.
