LG&E ENERGY CORP.
SAVINGS PLAN
Composite Copy
(Including Amendments Effective 8/1/98)
TABLE OF CONTENTS
Page No.
INTRODUCTION...........................................................1
DEFINITIONS............................................................2
Section 1.1 Adjustment............................................2
Section 1.2 Annual Additions......................................2
Section 1.3 Annuity Starting Date.................................2
Section 1.4 Beneficiary...........................................2
Section 1.5 Board.................................................2
Section 1.6 Break in Service......................................2
Section 1.7 Code..................................................2
Section 1.8 Committee.............................................2
Section 1.9 Company...............................................2
Section 1.10 Company Stock.........................................3
Section 1.11 Compensation..........................................3
Section 1.12 Defined Benefit Plan..................................3
Section 1.13 Defined Contribution Plan.............................3
Section 1.14 Dividend Eligible Participant.........................3
Section 1.15 Early Retirement Date.................................3
Section 1.16 Effective Date........................................4
Section 1.17 Employee..............................................4
Section 1.18 Employee Voluntary Contributions......................4
Section 1.19 Employee Voluntary Contributions Account..............4
Section 1.20 Employer..............................................4
Section 1.21 Employer Contributions................................4
Section 1.22 Employment Commencement Date..........................4
Section 1.23 Entry Date............................................4
Section 1.24 ESOP..................................................5
Section 1.25 ESOP Dividends........................................5
Section 1.26 Fiduciary.............................................5
Section 1.27 Former Participant....................................5
Section 1.28 Highly Compensated Employees..........................5
Section 1.29 Individual Account....................................8
Section 1.30 Investment Fund.......................................8
Section 1.31 Investment Manager ...................................8
Section 1.32 Key Employee..........................................8
Section 1.33 LG&E Energy Corp. Common Stock Fund...................9
Section 1.34 Leased Employee.......................................9
Section 1.35 Limitation Year.......................................9
Section 1.36 Mandatory Employer Contribution.......................9
Section 1.37 Matching Contribution Account.........................9
Section 1.38 Matching Contributions................................9
Section 1.39 Normal Retirement Date................................9
Section 1.40 Participant...........................................9
Section 1.41 Participating Employer................................9
Section 1.42 Paying Agent.........................................10
Section 1.43 Permissive Aggregation Group.........................10
Section 1.44 Plan.................................................10
Section 1.45 Plan Year............................................10
Section 1.46 Prior LPI Plan.......................................10
Section 1.47 Prior LNI Plan.......................................10
Section 1.48 Prior Plan...........................................10
Section 1.49 Profit Sharing Account...............................10
Section 1.50 Profit Sharing Contributions.........................10
Section 1.51 Qualified Joint and Survivor Annuity.................10
Section 1.52 Qualified Preretirement Survivor Annuity.............11
Section 1.53 Required Aggregation Group...........................11
Section 1.54 Rollover Contribution................................11
Section 1.55 Rollover Contribution Account........................11
Section 1.56 Salary Redirection...................................11
Section 1.57 Salary Redirection Account...........................11
Section 1.58 Severance From Service Date..........................12
Section 1.59 Sponsoring Employer..................................12
Section 1.60 Top Heavy Plan.......................................12
Section 1.61 Total and Permanent Disability.......................13
Section 1.62 Trust Agreement......................................13
Section 1.63 Trust Fund...........................................13
Section 1.64 Trustee..............................................13
Section 1.65 Valuation Date.......................................13
Section 1.66 Vested Individual Account............................13
Section 1.67 Year of Service......................................13
PARTICIPATION.........................................................14
Section 2.1 Eligibility Requirements.............................14
Section 2.2 Plan Binding.........................................14
Section 2.3 Reemployment.........................................14
Section 2.4 Beneficiary Designation..............................15
Section 2.5 Notification of Individual Account Balance...........15
CONTRIBUTIONS.........................................................16
Section 3.1 Salary Redirection.................................. 16
Section 3.2 Matching Contributions...............................18
Section 3.3 Rollover Amount From Other Plans.....................18
Section 3.4 Nondiscrimination Test for Salary Redirection........19
Section 3.5 Nondiscrimination Test for Other Contributions.......22
Section 3.6 Maximum Individual Deferral..........................25
Section 3.7 Mistake of Fact......................................25
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ALLOCATIONS TO INDIVIDUAL ACCOUNTS....................................26
Section 4.1 Individual Accounts..................................26
Section 4.2 Investment of Accounts...............................26
Section 4.3 Valuation of Accounts................................27
Section 4.4 Trustee and Committee Judgment Controls..............28
Section 4.5 Maximum Additions....................................28
Section 4.6 Corrective Adjustments...............................29
Section 4.7 Defined Contribution and Defined Benefit
Plan Fraction........................................29
DISTRIBUTIONS.........................................................31
Section 5.1 Normal Retirement....................................31
Section 5.2 Early Retirement.....................................31
Section 5.3 Late Retirement......................................31
Section 5.4 Death................................................31
Section 5.5 Disability...........................................31
Section 5.6 Termination of Employment............................31
Section 5.7 Commencement of Benefits.............................32
Section 5.8 Minimum Distributions................................32
Section 5.9 Methods of Payment...................................33
Section 5.10 Benefits to Minors and Incompetents..................34
Section 5.11 Unclaimed Benefits...................................35
Section 5.12 Participant Directed Rollovers.......................35
WITHDRAWALS AND LOANS.................................................37
Section 6.1 Hardship Withdrawal..................................37
Section 6.2 Participant Loans....................................39
EMPLOYEE STOCK OWNERSHIP PLAN.... ....................................42
Section 7.1 Purpose and Effective Date...........................42
Section 7.2 Investment in Company Stock..........................42
Section 7.3 Prior ESOP Accounts..................................42
Section 7.4 General ESOP Provisions..............................43
Section 7.5 Put Option...........................................43
Section 7.6 Loans................................................44
Section 7.7 Disposition of Dividends on Company Stock............45
Section 7.8 Voting of Stock and Other Stock Rights...............45
Section 7.9 Section 16 Compliance................................46
PROVISIONS RELATING TO ENERGY MARKETING EMPLOYEES.....................47
Section 8.1 Eligibility..........................................47
Section 8.2 Profit Sharing Contributions.........................47
Section 8.3 Salary Redirection Contributions.....................47
Section 8.4 Matching Contributions...............................49
Section 8.5 Employee Voluntary Contributions.....................50
Section 8.6 Submission of Form...................................50
Section 8.7 Vesting..............................................52
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Section 8.8 Forfeitures..........................................52
PROVISIONS RELATING TO PRIOR LPI PLAN PARTICIPANTS....................54
Section 9.1 Prior LPI Plan Balances..............................54
Section 9.2 Service..............................................54
Section 9.3 Vesting..............................................54
Section 9.4 Forfeitures..........................................54
PROVISIONS RELATING TO PRIOR LNI PLAN PARTICIPANTS....................56
Section 10.1 Prior LNI Plan Balances..............................56
Section 10.2 Service..............................................56
Section 10.3 Vesting..............................................56
Section 10.4 Forfeitures..........................................56
Section 10.5 Distributions........................................57
FUNDING 59
Section 11.1 Contributions........................................59
Section 11.2 Trustee..............................................59
FIDUCIARIES...........................................................60
Section 12.1 General..............................................60
Section 12.2 Employer.............................................60
Section 12.3 Trustee..............................................61
Section 12.4 401(k) Savings Committee.............................61
Section 12.5 Claims Procedures....................................62
Section 12.6 Records..............................................63
AMENDMENT AND TERMINATION OF THE PLAN.................................65
Section 13.1 Amendment of the Plan................................65
Section 13.2 Termination of the Plan..............................65
Section 13.3 Return of Contributions..............................65
MISCELLANEOUS.........................................................67
Section 14.1 Governing Law........................................67
Section 14.2 Construction.........................................67
Section 14.3 Administration Expenses..............................67
Section 14.4 Participant's Rights.................................67
Section 14.5 Spendthrift Clause...................................67
Section 14.6 Merger, Consolidation or Transfer....................68
Section 14.7 Counterparts.........................................68
TOP HEAVY PLAN PROVISIONS.............................................69
Section 15.1 General..............................................69
Section 15.2 Minimum Contribution.................................69
Section 15.3 Super Top Heavy Plans................................69
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PROVISIONS CONCERNING CERTAIN CHANGES IN EMPLOYMENT...................71
Section 16.1 Transfer to Non-Participating Employer...............71
Section 16.2 Transfer to Another Participating Employer...........71
Section 16.3 Transfer From Non-Participating Employer.............71
Section 16.4 Change in Employment Classification..................72
PROVISIONS RELATING TO PRIOR KENTUCKY UTILITIES COMPANY
EMPLOYEE SAVINGS PLAN PARTICIPANTS....................................73
Section 17.1 Participation of Former Employees....................73
Section 17.2 Service..............................................73
Section 17.3 Merger of Prior Plan Balances........................73
PROVISIONS RELATING TO WKE CORP. EMPLOYEES............................74
Section 18.1 Participation of Former Employees....................74
Section 18.2 Service..............................................74
SIGNATURES............................................................75
APPENDIX A............................................................76
APPENDIX B............................................................77
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INTRODUCTION
Effective April 1, 1987, the Board of Directors of Louisville Gas and
Electric Company ("Sponsoring Employer") adopted the Louisville Gas and Electric
Company Thrift Savings Plan ("Original Plan").
Effective January 1, 1992, the Employer amended and restated the
Original Plan in its entirety as the Louisville Gas and Electric Company 401(k)
Savings Plan (Plan). The Plan has subsequently been amended substantively,
technically and administratively.
Effective January 1, 1995 the name of the Plan was changed to LG&E
Energy Corp. and Louisville Gas and Electric Company 401(k) Savings Plan, the
terms which are hereinafter set forth.
Effective January 1, 1998 the name of the Plan is being changed to the
LG&E Energy Corp., Savings Plan. Effective the same day, the Louisville Gas and
Electric Company Employees' Stock Ownership Plan participant balances were
merged into the Plan. Also effective January 1, 1998, the LG&E Natural Inc.
Employee 401(k) Savings Plan ("Prior LNI Plan") and the LG&E Power Systems Inc.
Revised 401(k) Savings Plan ("Prior LPI Plan") were merged into the Plan.
Effective August 1, 1998 the Kentucky Utilities Company Employee
Savings Plan and the Kentucky Utilities Company Employee Stock Ownership Plan
were merged into the Plan.
It is intended that this Plan, together with the Trust Agreement, meet
all the requirements of the Internal Revenue Code of 1986, as amended (the
"Code") and the Employee Retirement Income Security Act of 1974 as amended
("ERISA") and shall be interpreted, wherever possible, to comply with the terms
of the said laws, as amended, and all formal regulations and rulings issued
thereunder. It is also intended that this Plan shall be a profit sharing plan
under Code Section 401(a).
ARTICLE 1
DEFINITIONS
Section 1.1 ADJUSTMENT means the net increases and decreases in the
market value of the Trust Fund during a Plan Year or other
period exclusive of any contribution or distribution during
such year or other period. Such increases and decreases
shall include such items as realized or unrealized
investment gains and losses and investment income, and may
include expenses of administering the Trust Fund and the
Plan.
Section 1.2 ANNUAL ADDITIONS means for any Employee in any Limitation
Year, the sum of Employer Contributions, Salary
Redirection, and forfeitures allocated to the Employee's
Individual Account. Amounts allocated to an individual
medical account, as defined in Section 415(l) of the Code,
which is part of an annuity or pension plan maintained by
the Employer are treated as Annual Additions to a Defined
Contribution Plan. Also, amounts derived from contributions
paid or accrued which are attributable to post-retirement
medical benefits allocated to the separate account of a Key
Employee as required by Section 419A(d) of the Code,
maintained by the Employer, are treated as Annual Additions
to a Defined Contribution Plan.
Section 1.3 ANNUITY STARTING DATE means the first day of the first
period for which an amount is paid as an annuity or the
first day on which all events have occurred which entitle
the Participant to such benefit.
Section 1.4 BENEFICIARY means any person designated by a Participant to
receive such benefits as may become payable hereunder after
the death of such Participant, provided, however, that a
married Participant may not name as his Beneficiary someone
other than his spouse unless the spouse consents in writing
to such designation, which consent shall be acknowledged by
a Plan representative or by a notary public.
Section 1.5 BOARD means the Board of Directors of the Employer.
Section 1.6 BREAK IN SERVICE means a twelve (12) consecutive month
period beginning on the Employee's Severance From Service
Date and each anniversary thereof during which an Employee
fails to perform at least one (1) Hour of Service for the
Employer.
Section 1.7 CODE means the Internal Revenue Code of 1986 as amended and
revised.
Section 1.8 COMMITTEE means the Benefits Committee provided for in
Article 12 hereof.
Section 1.9 COMPANY means LG&E Energy Corp. and all of the legal
entities which are part of a controlled group or affiliated
service group with LG&E Energy Corp. pursuant to the
provisions of Code Sections 414(b), (c), (m), or (o).
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Section 1.10 COMPANY STOCK means the common stock issued by the
Company having a combination of voting power and dividend
rates equal to or in excess of: (a) that class of common
stock of the Company having the greatest voting power, and
(b) that class of common stock of the Company having the
greatest dividend rights.
Section 1.11 COMPENSATION means, for any Plan Year, base compensation
paid to an Employee by an Employer, increased by (i)
amounts deferred pursuant to Code Section 125 (flexible
benefit plans), Section 402(g) (salary redirection), and
Section 402(h)(1)(B) (simplified employee plans), (ii) team
incentive awards, (iii) amounts deferred under the
Louisville Gas and Electric Company Nonqualified Savings
Plan, (iv) cost-of-living adjustments, and (v) commissions,
and excluding any long term incentive compensation paid by
an Employer. Effective January 1, 1995, Compensation shall
also include overtime compensation paid to a Participant.
In the Plan Year in which an Employee becomes a
Participant, only remuneration paid in the portion of the
Plan Year in which he was a Participant shall be considered
Compensation. Effective for Plan Years beginning on or
after January 1, 1989, and prior to January 1, 1994,
Compensation shall be limited to two hundred thousand
dollars ($200,000) or such larger amount as determined
pursuant to Code Section 401(a)(17). Effective for Plan
Years beginning on and after January 1, 1994, Compensation
shall be limited to one hundred fifty thousand dollars
($150,000) or such other amount as may be authorized
pursuant to Code Section 401(a)(17).
Section 1.12 DEFINED BENEFIT PLAN means a plan established and qualified
under Section 401 of the Code, except to the extent it is,
or is treated as, a Defined Contribution Plan.
Section 1.13 DEFINED CONTRIBUTION PLAN means a plan which is
established and qualified under Section 401 of the Code,
which provides for an individual account for each
participant therein and for benefits based solely on the
amount contributed to each participant's account and any
income, expenses, gains or losses (both realized and
unrealized) which may be allocated to such account.
Section 1.14 DIVIDEND ELIGIBLE PARTICIPANT means a Participant who will
not reach the maximum individual deferral amount as
described in Section 3.6 or a Participant who has not
reached the maximum Compensation amount described in
Section 1.11 herein, and all alternate payees Beneficiaries
and Former Participants.
Section 1.15 EARLY RETIREMENT DATE means the first day of the month on
or following the earlier of (i) the date the Participant
attains age fifty-five (55), or (ii) the date
3
the Participant is credited with thirty-five (35),effective
June 1, 1996 the date the Participant is credited with
thirty (30), years of vesting service under the LG&E Energy
Corp. and Louisville Gas and Electric Company Retirement
Income Plan.
Section 1.16 EFFECTIVE DATE means April 1, 1987, the effective date of
the Prior Plan. The effective date of this amended and
restated Plan is August1, 1998.
Section 1.17 EMPLOYEE means any person employed by the Employer on a
full time or regular part-time basis who works 20 hours per
week, subject to the following:
(1) The term "Employee" shall exclude any person who is a
Leased Employee.
(2) The term "Employee" shall exclude any employee who is
a part of a collective bargaining unit for which
benefits have been the subject of good faith
negotiation unless and until the Employer and the
collective bargaining unit representative for that
unit through the process of good faith bargaining
agree in writing for coverage hereunder.
Section 1.18 EMPLOYEE VOLUNTARY CONTRIBUTIONS means all amounts
contributed by Participants on an after-tax basis.
Section 1.19 EMPLOYEE VOLUNTARY CONTRIBUTIONS ACCOUNT means that
portion of a Participant's Individual Account attributable
to (i) Employee Voluntary Contributions allocated to such
Participant pursuant to Section 8.5, Article 9, and Article
10, and (ii) the Participant's proportional share,
attributable to his Employee Voluntary Contributions
Account, or the adjustments required by Article 4, Article
5 and Article 6.
Section 1.20 EMPLOYER means LG&E Energy Corp. and each of the legal
entities, or any successor thereto which is part of the
Company and which has adopted the Plan for its eligible
Employees with the consent of the Sponsoring Employer.
Section 1.21 EMPLOYER CONTRIBUTIONS means Matching Contributions
made to the Trust Fund by the Employer. Salary Redirection
shall not be included in the term Employer Contributions
when used in this Plan.
Section 1.22 EMPLOYMENT COMMENCEMENT DATE means the date on which an
Employee first performs an Hour of Service for the
Employer. If an Employee is reemployed by the Employer
after he incurs one or more Breaks in Service, the
Employment Commencement Date means the first day after his
immediately preceding Severance from Service Date on which
he first performs an Hour of Service for the Employer.
Section 1.23 ENTRY DATE means the first day of each calendar month
during each Plan Year.
4
Section 1.24 ESOP means the Employee Stock Ownership Plan established
pursuant to Article 7 of the Plan.
Section 1.25 ESOP DIVIDENDS means those amounts distributed during
the Plan Year to a Participant as dividends on stock
allocated to such Participant's account under the
Louisville Gas & Electric Company Employees' Stock
Ownership Plan, or effective January 1, 1998, pursuant to
Article 7 of the Plan.
Section 1.26 FIDUCIARY means the Employer, the Trustee, the Committee
and any individual, corporation, firm or other entity which
assumes, in accordance with Article 12, responsibilities of
the Employer, the Trustee or the Committee with respect to
management of the Plan or the disposition of its assets.
Section 1.27 FORMER PARTICIPANT means a Participant, other than a
Limited Participant, whose participation in the Plan has
terminated but who has not received payment in full of the
balance in his Individual Account to which he is entitled.
Section 1.28 HIGHLY COMPENSATED EMPLOYEES will be determined in
accordance with the following:
(a) HIGHLY COMPENSATED EMPLOYEE means an employee who
during the look back year or the determination
year:
(1) Was at any time a five percent (5%) owner
of the Employer;
(2) Received compensation from the Company in
excess of seventy-five thousand dollars
($75,000) (or such higher amount as may be
provided under Code Section 414(q));
(3) Received compensation from the Company in
excess of fifty thousand dollars ($50,000)
(or such higher amount as may be provided
under Code Section 414(q)) and was in a
group consisting of the top twenty percent
(20%) of the employees of the Company when
ranked on the basis of compensation; or
(4) Was at any time an officer and received
compensation greater than fifty percent
(50%) of the maximum amount under Code
Section 415(b)(1)(A). Not more than fifty
(50) officers (or, if lesser, the greater
of three (3) employees or ten percent
(10%) of the employees) shall be
considered under this Subsection as Highly
Compensated Employees. If no officer is
described above, then the highest paid
officer shall be treated as described in
this item (4).
(b) If the employee was not a Highly Compensated
Employee for the look
5
back year, then he shall not be considered a
Highly Compensated Employee for the determination
year unless he is a five percent (5%) owner of
the Employer or one of the highest paid one
hundred (100) employees and meets the criteria of
items (2), (3) or (4) of Subsection (a) of this
Section.
(c) If the Highly Compensated Employee is a five
percent (5%) owner or one of the ten (10) most
highly compensated employees, then the
compensation and contributions of employees who
are spouses, lineal descendants, ascendants or
spouses of lineal descendants or ascendants of
such Highly Compensated Employees shall be
attributed to the Highly Compensated Employee and
the employees who are such relatives shall not be
considered as separate employees. In the event
that family aggregation is required, the
limitation on compensation pursuant to Code
Section 401(a)(17) will be allocated among those
family members who have not attained age nineteen
(19) by the close of the Plan Year by multiplying
the limitation by a fraction, the numerator of
which is the individual family member's
compensation and the denominator of which is the
total compensation of all members of the family
group or in such other manner as provided by
regulation and pronouncements of the Internal
Revenue Service.
(d) For purposes of determining Highly Compensated
Employees, compensation shall mean compensation
paid by the Company for purposes of Code Section
415(c)(3) and shall include amounts deferred
pursuant to Code Sections 125 (flexible benefit
plans); 402(a)(8) (salary redirection); and
402(h)(1)(B) (simplified employee plans).
(e) For purposes of determining the top twenty
percent (20%) of employees and the number of
officers counted as Highly Compensated Employees,
the following employees shall be excluded:
(1) Employees who have not completed six (6)
months of service,
(2) Employees who normally work less than
seventeen and one-half (17-1/2) hours per
week,
(3) Employees who normally work during not
more than six (6) months during the Plan
Year,
(4) Employees who have not attained age
twenty-one (21),
(5) Employees included in a collective
bargaining unit covered by an agreement
with the Company (to the extent permitted
by regulations), and
6
(6) Employees who are non-resident aliens.
(f) A former employee shall be treated as a Highly
Compensated Employee if (1) such employee was a
Highly Compensated Employee when such employee
separated from Service, or (2), such employee was
a Highly Compensated Employee at any time after
attainment of age fifty-five (55).
(g) Except as otherwise provided in this Section, the
term "look back year" shall mean the twelve (12)
month period immediately preceding the
determination year.
(h) Except as otherwise provided in this Section the
term "determination year" shall mean the current
Plan Year.
(i) To the extent permitted by regulations under Code
Section 414(q), the Employer may elect to make
the look back year calculation on the basis of
the calendar year ending with or within the
applicable determination year (or, in the case of
a determination year that is shorter than twelve
(12) months, the calendar year ending with or
within the twelve (12) month period ending with
the end of the determination year). In such case,
the Employer must make the determination year
calculation on the basis of the period (if any)
by which the applicable determination year
extends beyond such calendar year. If the
Employer makes the election provided for in this
Subsection, such election must be made with
respect to all plans, entities and arrangements
of the Employer.
(j) The determination of Highly Compensated Employees
shall be determined on a Company wide basis and
shall not be determined on an Employer by
Employer or plan by plan basis.
(k) If the Employer so elects for a year, item (2) of
Subsection (a) of this Section shall be applied
by substituting fifty thousand dollars ($50,000)
in place of seventy-five thousand dollars
($75,000), and item (3) of Subsection (a) of this
Section shall not apply, provided that:
(1) At all times during such year, the
Employer maintained substantial business
activities and employed employees in at
least two (2) significantly separate
geographic areas, and
(2) The Employer satisfies such other
conditions as may be prescribed by the
Secretary of the Treasury.
(l) The determination of Highly Compensated Employees
shall be governed by Code Section 414(q) and the
regulations issued thereunder.
7
Section 1.29 INDIVIDUAL ACCOUNT means the detailed record kept of the
amounts credited or charged to each Participant in
accordance with the terms hereof. Such Individual Account
is comprised of the following accounts: a Salary
Redirection Account, a Matching Contribution Account, a
Rollover Contribution Account, and effective January 1,
1998, the Prior ESOP account, Voluntary Employee
Contribution Account, the Prior LPI Plan account, and the
Prior LNI Plan account. Effective August 1, 1998,
Individual Account shall include the Prior KU Savings
account.
Section 1.30 INVESTMENT FUND means the investment fund established
pursuant to Section 4.2.
Section 1.31 INVESTMENT MANAGER means a Fiduciary (other than the
Trustee or other named Fiduciary) as defined in Section
3(38) of the Employee Retirement Income Security Act of
1974 who is appointed by the Sponsoring Employer pursuant
to Section 12.3.
Section 1.32 KEY EMPLOYEE shall mean any employee, former employee
or beneficiary thereof in an Internal Revenue Service
qualified plan adopted by the Company who at any time
during the Plan Year or any of the four (4) preceding Plan
Years is
(a) An officer of the Company having an annual
compensation from the Company during the Plan
Year greater than fifty percent (50%) of the
amount in effect under Code Section 415(b)(1)(A)
for the calendar year in which such Plan Year
ends;
(b) One (1) of the ten (10) employees having an
annual compensation from the Company for a Plan
Year of more than the limitation in effect under
Code Section 415(c)(1)(A) for the calendar year
in which such Plan Year ends and owning (or
considered as owning within the meaning of Code
Section 318) both more than a one-half percent
(1/2%) interest, and the largest interest in the
Employer;
(c) A five percent (5%) owner of the Employer; or
(d) A one percent (1%) owner of the Employer having
an annual compensation from the Company for a
Plan Year of more than one hundred fifty thousand
dollars ($150,000).
(e) For purposes of this Section, compensation means
compensation as defined in Code Section 415.
(f) This definition shall be interpreted consistent
with Code Section 416 and rules and regulations
issued thereunder. Further, such law and
regulations shall be controlling in all
determinations under this
8
definition, inclusive of any provisions and
requirements stated thereunder but hereinabove
absent.
Section 1.33 LG&E ENERGY CORP. COMMON STOCK FUND means the fund
invested primarily in shares of common stock of LG&E
Energy Corp.
Section 1.34 LEASED EMPLOYEE shall mean any person (other than an
employee of the recipient)who provides services to the
recipient if such services are provided pursuant to an
agreement between the recipient and any other person
("leasing organization"), such person has performed such
services for the recipient (or for the recipient and any
related persons determined in accordance with Code Section
414(n)(6)) on a substantially full-time basis for a period
of one (1) year, and such services are of a type
historically performed by employees in the business field
of the recipient employer.
Section 1.35 LIMITATION YEAR means the twelve (12) month period
beginning on January 1 and ending on December 31.
Section 1.36 MANDATORY EMPLOYER CONTRIBUTION means the portion of the
Prior LPI Plan or Prior LNI Plan account attributable to
profit sharing contributions.
Section 1.37 MATCHING CONTRIBUTION ACCOUNT means that portion of a
Participant's Individual Account attributable to (i)
Matching Contributions allocated to such Participant
pursuant to Section 3.2 and 8.4 and (ii) the Participant's
proportionate share, attributable to his Matching
Contribution Account, of the Adjustments, reduced by any
distributions from such Account pursuant to Article 5 and
any withdrawals from such Account pursuant to Article 6.
Effective January 1, 1998, (i) the portion of a
Participant's Individual Account attributable to matching
contributions allocated to such Participant pursuant to the
Prior LPI Plan and the Prior LNI Plan and (ii) the
Participant's proportionate share, attributable to his
matching contribution, of the Adjustments, reduced by any
distributions from such Account pursuant to Article 5 and
any withdrawals from such Account pursuant to Article 6.
Section 1.38 MATCHING CONTRIBUTIONS means contributions made to the
Trust Fund by the Employer pursuant to Section 3.2 and
Section 8.4.
Section 1.39 NORMAL RETIREMENT DATE means the first day of the
month coincident with or next following the Participant's
sixty-fifth (65th) birthday. The Normal Retirement Age
shall be age sixty-five (65).
Section 1.40 PARTICIPANT means any Employee who becomes a Participant as
provided in Article 2 hereof.
Section 1.41 PARTICIPATING EMPLOYER means an Employer who has adopted
the Plan and has been approved by the Board.
9
Section 1.42 PAYING AGENT means the payroll department of the
Company or a Participating Employer, acting as agent for a
Participant, or the trustees of the Louisville Gas &
Electric Company Employees' Stock Ownership Plan and Trust,
or effective January 1, 1998, the Trustee of the Plan.
Section 1.43 PERMISSIVE AGGREGATION GROUP means the Required
Aggregation Group and each other plan or plans of the
Company that are not required to be included in the
Required Aggregation Group, and which, if treated as being
part of such group, would not cause such group to fail to
meet the requirements of Code Section 401(a) and 410.
Section 1.44 PLAN means, effective January 1, 1998, the LG&E Energy
Corp. Savings Plan.
Section 1.45 PLAN YEAR means the twelve (12) month period beginning
on January 1 and ending on December 31.
Section 1.46 PRIOR ESOP ACCOUNT means effective January 1, 1998, a
balance transferred from the Louisville Gas and Electric
Company Employees' Stock Ownership Plan and Trust plus any
investment gains, and minus investment losses and
distributions. Effective August 1, 1998 the term Prior ESOP
Account shall also mean a balance transferred from the
Kentucky Utilities Company Employee Stock Ownership Plan
plus any investment gains, and minus investment losses and
distributions.
Section 1.47 PRIOR LPI PLAN means the LG&E Power Systems Inc. Revised
401(k) Savings Plan, which was merged into the Plan
effective January 1, 1998.
Section 1.48 PRIOR LNI PLAN means the LG&E Natural Inc. Employee 401(k)
Savings Plan, which was merged into the Plan effective
January 1, 1998.
Section 1.48 PRIOR PLAN means the Louisville Gas and Electric Company
Thrift Savings Plan as amended through December 31, 1993,
and effective January 1, 1995 the LG&E Energy Corp. and
Louisville Gas & Electric Company 401(k) Savings Plan.
Section 1.49 PROFIT SHARING ACCOUNT means the portion of the
Individual Account established to hold Profit Sharing
Contributions.
Section 1.50 PROFIT SHARING CONTRIBUTIONS means Employer contributions
made pursuant to Article 8 of the Plan effective with the
1998 Plan Year.
Section 1.51 QUALIFIED JOINT AND SURVIVOR ANNUITY means an
immediate annuity for the life of the Participant with a
survivor annuity for the life of the Participant's spouse
which is fifty percent (50%) of the amount of the annuity
payable during the joint lives of the Participant and his
spouse and which is the amount
10
of benefit which can be purchased as of the Annuity
Starting Date with the Participant's Vested Individual
Account. A Qualified Joint and Survivor Annuity for a
Participant who is not married is an annuity for the life
of the Participant. Any annuity contract distributed must
be nontransferable.
Section 1.52 QUALIFIED PRERETIREMENT SURVIVOR ANNUITY means an
annuity for the life of a Participant's surviving spouse,
which is equal to fifty percent (50%) of the amount of
benefit which can be purchased as of the Annuity Starting
Date with the Participant's Vested Individual Account. Any
security interest held by the Plan by reason of a loan
outstanding to a Participant shall be taken into account in
determining the amount of the Qualified Preretirement
Survivor Annuity. Any annuity contract distributed from the
Plan must be nontransferable.
Section 1.53 REQUIRED AGGREGATION GROUP means
(a) Each plan of the Company in which a Key Employee
is a participant; and
(b) Each other plan of the Company which enables any
plan in (a) to meet the requirements of Code
Section 401(a)(4) or 410; and
(c) Each terminated plan maintained by the Company
within the last five (5) years ending on the
determination date for the Plan Year in question
and which, but for the fact that it terminated,
would be part of a Required Aggregation Group for
such Plan Year.
Section 1.54 ROLLOVER CONTRIBUTION means contributions made to the Trust
Fund by an Employee pursuant to Section 3.3.
Section 1.55 ROLLOVER CONTRIBUTION ACCOUNT means that portion of an
Employee's Individual Account attributable to (i) Rollover
Contributions pursuant to Section 3.3 and (ii) the
Participant's proportionate share, attributable to his
Rollover Contribution Account, of the Adjustments, reduced
by any distributions from such Account pursuant to Article
5 and any withdrawals from such account pursuant to Article
6.
Section 1.56 SALARY REDIRECTION means contributions made to the Trust
Fund by the Employer pursuant to Section 3.1 and Section
8.3.
Section 1.57 SALARY REDIRECTION ACCOUNT means that portion of a
Participant's Individual Account attributable to (i) Salary
Redirection amounts made on his behalf pursuant to Section
3.3 and Section 8.3 and (ii) the Participant's
proportionate share, attributable to his Salary Redirection
Account, of the Adjustments, reduced by any distributions
from such Account pursuant to Article 5 and any withdrawals
from such Account pursuant to Article 6.
11
Section 1.58 SEVERANCE FROM SERVICE DATE means the date on which an
Employee quits, retires, is discharged, fails to return
from a leave of absence, or dies; provided he is not
credited with an Hour of Service within twelve (12) months
of such date.
Section 1.59 SPONSORING EMPLOYER means LG&E Energy Corp.
Section 1.60 TOP HEAVY PLAN means any plan under which, as of any
determination date (the last day of the preceding Plan
Year), the present value of the cumulative accrued benefits
under the plan for Key Employees exceeds sixty percent
(60%) of the present value of cumulative accrued benefits
under the Plan for all Employees. For purposes of this
definition the following provisions shall apply:
(a) If such plan is a Defined Contribution Plan, the
present value of cumulative accrued benefits
shall be deemed to be the market value of all
employee accounts under the Plan, other than
voluntary deductible employee contributions. If
such plan is a Defined Benefit Plan, the present
value of cumulative accrued benefits shall be the
present value determined pursuant to actuarial
assumptions adopted by the Company for purposes
of determining whether the plan is a Top Heavy
Plan and the accrued benefit of any employee
other than a Key Employee shall be determined
under the method which is used for accrual
purposes for all plans of the Company or, if
there is no such method, as if such benefit
accrued not more rapidly than the slowest accrual
rate permitted under the fractional accrual rule
of Code Section 411(b)(1)(C). Moreover, the
present value of the cumulative accrued benefits
shall be increased by the amount of all plan
distributions made with respect to an employee
during the five (5) year period ending on the
determination date, including distributions made
under a terminated plan that is part of a
Required Aggregation Group.
(b) A plan shall be considered to be a Top Heavy Plan
for any Plan Year if, on the last day of the
preceding Plan Year, the above rules were met.
For the first Plan Year that the Plan shall be in
effect, the determination of whether the Plan is
a Top Heavy Plan shall be made as of the last day
of such Plan Year.
(c) Each plan of the Company required to be included
in a Required Aggregation Group shall be treated
as a Top Heavy Plan if such group is a top heavy
group.
(d) With regard to a Participant or former
Participant who (i) has not performed any service
for the Employer at any time during the five (5)
year period ending on the determination date,
or (ii) was formerly a Key Employee, but who is
not a Key Employee on the determination date,
12
the present value of the cumulative accrued
benefit for such Participant or former
Participant shall not be taken into account for
the purposes of determining whether this Plan is
a Top Heavy Plan.
(e) This definition shall be interpreted consistent
with Code Section 416 and rules and regulations
issued thereunder. Further, such law and
regulation shall be controlling in all
determinations under this definition inclusive of
any provisions and requirements stated thereunder
but hereinabove absent.
Section 1.61 TOTAL AND PERMANENT DISABILITY or TOTALLY AND PERMANENTLY
DISABLED means a physical or mental condition for which the
Participant is under the care of a licensed physician and
which, in the opinion of the Committee, results in the
Participant being unable to perform the material duties of
his or her regular occupation.
Section 1.62 TRUST AGREEMENT means the agreement entered into between
the Sponsoring Employer and the Trustee pursuant to Article
11 hereof.
Section 1.63 TRUST FUND means the trust fund created in accordance with
Article 11 hereof.
Section 1.64 TRUSTEE means such individual or corporation as shall
be designated in the Trust Agreement to hold in trust any
assets of the Plan for the purpose of providing benefits
under the Plan, and shall include any successor trustee
designated thereunder.
Section 1.65 VALUATION DATE means the date the Investment Manager
values the assets of the Investment Fund. The Valuation
Date will occur at least once a year.
Section 1.66 VESTED INDIVIDUAL ACCOUNT means the aggregate value of
the Participant's Employee contributions, Rollover
Contributions, Prior ESOP Account, the nonforfeitable
balance of the Employer Contributions based on Years of
Service.
Section 1.67 YEAR OF SERVICE means a period of three hundred sixty-five
(365) days of Service.
13
ARTICLE 2
PARTICIPATION
Section 2.1 ELIGIBILITY REQUIREMENTS
Each Employee shall be eligible to participate as
of the Entry Date coincident with or next
following the completion of six (6) months, three
(3) months effective January 1, 1998, of
employment in the twelve (12) month period
commencing on the date he first performs an Hour
of Service as defined in Department of Labor
regulation Section 2530.200b-2, or in any calendar
year. Notwithstanding the preceding, if an
Employee was first employed by the Company on or
after January 1, 1991, and prior to October 1,
1991, said Employee shall be eligible to
participate in the Plan on January 1, 1992.
Section 2.2 PLAN BINDING
Upon becoming a Participant, a Participant shall
be bound then and thereafter by the terms of this
Plan and the Trust Agreement, including all
amendments to the Plan and the Trust Agreement
made in the manner herein authorized.
Section 2.3 REEMPLOYMENT
(a) Termination of employment shall be deemed to occur
when an Employee has an interruption in continuity
of his employment by the Company. Such termination
may have resulted from retirement, death,
voluntary or involuntary termination of
employment, unauthorized absence, or by failure to
return to active employment with the Company or to
retire by the date on which an authorized leave of
absence expired.
(b) If an Employee who was not eligible to become a
Participant in the Plan during his prior period of
employment is reemployed, he shall be eligible to
participate in the Plan after he has met the
requirements of Section 2.1.
(c) If an Employee who was a Participant in the Plan
during his prior period of employment is
reemployed, he shall be eligible to again become a
Participant as of the date he again becomes an
Employee.
(d) If a person employed by the Employer becomes an
Employee as defined under this Plan, he shall be
eligible to participate in the Plan as of the date
of his change in status, provided he has met the
requirements of Section 2.1. If a person employed
by the Employer ceases to be an Employee as
defined under the Plan he will cease to be an
active
14
Participant effective as of the first payroll
coincident with or next following his change in
status.
Section 2.4 BENEFICIARY DESIGNATION
Upon commencing participation, each Participant
shall designate a Beneficiary on forms furnished
by the Committee. Such Participant may then from
time to time change his Beneficiary designation by
written notice to the Committee and, upon such
change, the rights of all previously designated
Beneficiaries to receive any benefits under this
Plan shall cease. A married Participant may not
name as his Beneficiary someone other than his
spouse unless the spouse consents in writing to
such designation, which consent shall be
acknowledged by a Plan representative or by a
notary public. If the Beneficiary designation
consented to by the spouse is not limited to a
specific Beneficiary ("general consent"), the
consent must acknowledge that the spouse has a
right to limit consent to a specific Beneficiary.
The consent of the spouse must be obtained each
time the Beneficiary is changed, unless a general
consent is given. If, at the time of a
Participant's death while benefits are still
outstanding, his named Beneficiary does not
survive him, the benefits shall be paid to his
named contingent Beneficiary. If a deceased
Participant is not survived by either a named
Beneficiary or contingent Beneficiary (or if no
Beneficiary was effectively named), the benefits
shall be paid in a single sum to the person or
persons in the first of the following classes of
successive preference beneficiaries then
surviving: the Participant's (i) surviving spouse,
(ii) children, (iii) parents, (iv) brothers and
sisters, (v) executors and administrators. If the
Beneficiary or contingent Beneficiary is living at
the death of the Participant, but such person dies
prior to receiving the entire death benefit, the
remaining portion of such death benefits shall be
paid in a single sum to the estate of such
deceased Beneficiary or contingent Beneficiary.
Section 2.5 NOTIFICATION OF INDIVIDUAL ACCOUNT BALANCE
At least once each Plan Year or more frequently as
determined by the Committee, the Committee shall
notify each Participant of the amount of his share
in the Adjustments and Contributions for the
period just completed, and the new balance of his
Individual Account.
15
ARTICLE 3
CONTRIBUTIONS
Section 3.1 SALARY REDIRECTION
Each Employee employed by an Employer listed on
Appendix A who satisfies the requirements of
Section 2.1 may elect to have Salary Redirection
made on his behalf, commencing on the date
specified in Section 2.1. Such election shall be
made by entering into a Salary Redirection
agreement with the Employer in which it is agreed
that the Employer will redirect a portion of the
Participant's Compensation and contribute that
designated amount to the Trust Fund on behalf of
the Participant in accordance with the following.
(a) SALARY REDIRECTION AGREEMENT. Each eligible
Employee may enter into a Salary Redirection
agreement under which the Employee's Employer will
redirect a portion of the Participant's
Compensation during each payroll period in an
amount equal to an integral percentage from one
percent (1%) to sixteen percent (16%) of such
Compensation and contribute such percentage to the
Trust Fund on behalf of the Participant.
(b) SUBMISSION OF FORM. In order for Salary
Redirection to commence on the appropriate date
(the beginning of a payroll period), the Salary
Redirection agreement must be received by the
Committee, or effective June 1, 1998, the designee
of the Committee, at least fifteen (15) days prior
to the date Salary Redirection is to start.
Notwithstanding the above, a terminated
Participant who is reemployed and is eligible to
participate upon reemployment may enter into a
Salary Redirection Agreement on his reemployment
date to be applicable to Compensation earned on
and after such date. In the event a Participant
does not so elect when initially eligible, he may
subsequently elect to have Salary Redirection made
on his behalf commencing with the first day of any
payroll period which is at least fifteen (15) days
after the date his election form is delivered to
the Committee. The Salary Redirection agreement
shall be on a form provided, or effective June
1,1998, in a manner prescribed by the Committee.
Such agreement shall authorize the Employer to
reduce Compensation otherwise payable to the
Participant during each pay period by the amount
of Salary Redirection elected.
(c) CHANGE IN REDIRECTED AMOUNTS. A Participant
electing to have Salary Redirection made on his
behalf to the Plan pursuant to this Section, may,
on a Salary Redirection agreement prescribed by
and submitted in
16
a manner established by the Committee, increase or
decrease his Salary Redirection amount (within the
appropriate minimum and maximum) as of the first
day of any payroll period which is at least
fifteen (15) days after the date his election form
is received by the Committee, but not
retroactively. Effective June 1, 1998, a
Participant electing to have Salary Redirection
made on his behalf to the Plan pursuant to this
Section, may in a manner prescribed by the
Committee, enter into a Salary Redirection
agreement to increase or decrease his Salary
Redirection amount (within the appropriate minimum
and maximum) as of the first day of any payroll
period which is at least fifteen days after the
date of such election, but not retroactively. The
Salary Redirection agreement shall state the
amount of Salary Redirection he desires to have
made.
(d) CESSATION OF REDIRECTION. Any Participant may
elect to cease future Salary Redirection to the
Plan effective with the first regular payroll
period that it is administratively possible to do
so following notification. In the event any such
Participant desires thereafter to recommence
having Salary Redirection made on his behalf, he
shall be allowed to do so effective with the first
day of any payroll period which is at least
fifteen (15) days after receipt of written notice
by the Committee on the appropriate form stating,
or effective June 1, 1998, in the manner
prescribed by the Committee, the amount of Salary
Redirection he desires to have made.
(e) NOTICE REQUIREMENTS. Any of the notice
requirements in this Section may be lengthened or
shortened by the Committee if it finds it
administratively necessary or feasible to do so,
with such discretion being exercised in a
nondiscriminatory manner.
(f) PAYMENT TO TRUSTEE. The Employer shall pay to the
Trustee any Salary Redirection made on behalf of
any Participant within a reasonable time following
the end of each regular pay period, but no later
than ninety (90) days beginning on the date on
which such Salary Redirection would otherwise be
paid to the Participant in cash. Effective
February 3, 1997, the Employer shall pay to the
Trustee any Salary Redirection made on behalf of
any Participant as of the earliest date on which
such Salary Redirection can reasonably be
segregated from the Employer's general assets, but
no later than the fifteenth (15th) business day of
the month following the month in which the Salary
Redirection is received by the Employer or the
fifteenth (15th) business day of the month
following the month in which the Salary
Redirection would otherwise have been payable to
the Participant in cash.
(g) AMOUNTS OF ESOP DIVIDENDS DEEMED DEFERRED.
Effective January 1, 1996, a Dividend Eligible
Participant will be deemed to have elected to
17
have a Salary Redirection made on his behalf in
the amount of the ESOP Dividends paid to him in
cash, subject to the limits of Sections 401(k),
402(g) and 415 of the Code and the regulations
thereunder, unless the Participant elects
otherwise by making the appropriate election with
the Committee in the manner prescribed by the
Committee. Effective January 1, 1998, a Dividend
Eligible Participant will be deemed to have
elected to have a Salary Redirection made on his
behalf in the amount of the ESOP Dividends paid to
him in cash, subject to the limits of Sections
401(k), 402(g) and 415 of the Code and the
regulations thereunder. Deemed deferrals made
pursuant to this Subsection 3.1(g), shall not be
taken into account in the calculation of the
percentage of salary redirected pursuant to
Subsection 3.1(a).
Section 3.2 MATCHING CONTRIBUTIONS
For each Accounting Year in which the Employer
listed on Appendix A has net profits or
accumulated net profits, as determined under
generally accepted accounting principles, said
Employer shall make an Employer Matching
Contribution from such net profits or accumulated
net profits to the Trust Fund on behalf of
eligible Participants. The Matching Contribution
will be an amount necessary to match thirty-three
percent (33%), fifty percent (50%) effective
January 1, 1998, of said eligible Participants'
net eligible Salary Redirection made to the Trust
Fund for the Plan Year. Net eligible Salary
Redirection means Salary Redirection not to exceed
six percent (6%) percent of Compensation during
the Plan Year, which Salary Redirection has not
been withdrawn. For purposes of calculating net
eligible Salary Redirection, withdrawals shall be
deemed to have been made from the earliest Salary
Redirection not yet withdrawn. Any Matching
Contribution which is made as of a Valuation Date
shall be allocated to the Matching Contribution
Account of each eligible Participant. For purposes
of this Section, an eligible Participant shall
mean a Participant who has made Salary Redirection
contributions during the Plan Year and is being
employed by an Employer listed on Appendix A.
Section 3.3 ROLLOVER AMOUNT FROM OTHER PLANS
An Employee eligible to participate in the Plan,
regardless of whether he has satisfied the
participation requirements of Section 2.1, may
transfer to the Trust Fund an "eligible rollover
distribution," defined in Code Section 402(c)(4),
provided that such distribution is from a plan
that meets the requirements of Code Section
401(a).
(a) The procedures approved by the Committee shall
provide that such a transfer may be made only if
the following conditions are satisfied:
18
(1) The transfer occurs on or before the
sixtieth (60th) day following the
distribution from the other plan;
(2) The amount transferred is equal to any
portion of the distribution made from the
other plan, subject to the maximum
rollover provision of Section 402 of the
Code; and
(3) Any contribution rolled over pursuant to
this provision is entirely in cash.
(b) Notwithstanding the foregoing, if an Employee had
deposited a distribution previously received from
another qualified plan into an individual
retirement account, as defined in Code Section
408, he may transfer the amount of such
distribution, plus earnings thereon, to this plan;
provided such rollover amount is deposited with
the Trustee on or before the sixtieth (60th) day
following the Employee's receipt thereof from the
individual retirement account.
(c) The Committee shall develop such procedure, and
may require such information from an Employee
desiring to make such a rollover or transfer, as
it deems necessary or desirable to determine that
the rollover or transfer will meet the
requirements of this Section. Upon approval by the
Committee, or effective June 1, 1998, upon the
approval pursuant to a method authorized by the
Committee, the amount rolled over or transferred
shall be deposited in the Trust Fund and shall be
credited to a Rollover Account. The value of such
Account shall be one hundred percent (100%) vested
in the Employee and shall share in income
allocations in accordance with Section 4.3. Upon
the employee's termination of employment with the
Company, the total amount of the Rollover Account
shall be distributed in accordance with Article 5.
(d) Upon such a rollover or transfer by an Employee
who is otherwise eligible to participate in the
Plan but who has not yet completed the
participation requirements of Section 2.1, his
Rollover Account shall represent his sole interest
in the Plan until he becomes a Participant.
Section 3.4 NONDISCRIMINATION TEST FOR SALARY REDIRECTION
(a) Periodically as determined by the Employer, the
Employer shall check the actual deferral
percentages against the tests identified below. In
the event that neither test is met, the Employer
shall reduce the Salary Redirection percentages of
Highly Compensated Employees that are above the
maximum deferral percentage allowed under the
tests; provided that the initial reductions shall
be in unmatched Salary Redirection, and only if
such redirections are not sufficient shall matched
Salary Redirection be reduced. Beginning with the
highest
19
such percentage, each contribution percentage
shall be reduced to the next highest percentage,
and so forth, until the excess is eliminated. If
it is necessary to reduce the matched Salary
Redirection, the Participant shall nevertheless
receive from the Plan a distribution equal to the
Employer Matching Contribution plus any income
thereon that would have been allocated to him had
such reduction in contribution not been necessary.
(b) The term "eligible Employees," for purposes of
this Section, shall mean all employees of the
Employer who are eligible to make Salary
Redirection contributions during the Plan Year for
which the tests are being made.
(c) The term "actual deferral percentage," means the
average of the following percentages (calculated
separately for each eligible Employee): Salary
Redirection contributions on behalf of each
eligible Employee divided by the compensation of
the eligible Employee. Matching Contributions will
be included in the numerator to the extent that
those contributions are not included for purposes
of calculating the actual contribution percentage
under Section 3.5. In calculating the actual
deferral percentage of a Highly Compensated
Employee who participates in more than one cash or
deferred arrangement of the Company, all cash or
deferred arrangements ending with or within the
same calendar year shall be treated as a single
arrangement.
(d) The term "compensation" for purposes of this
Section shall include amounts paid by the Company
to the Employee during the period he is eligible
to make Salary Redirection contributions and which
amounts are currently includable in the Employee's
gross income. For all Plan Years, the Company
shall have the right to increase the Employee's
compensation, for purposes of this Section, by the
amount of an Employee's salary redirection
election under Code Section 125 (flexible benefit
plans), Section 402(g) (salary redirection) and
Section 402(h)(1)(B) (simplified employee plans),
or to use such alternative definition of
compensation as may be provided under Code Section
414(s). Alternate definitions of compensation
under Code Section 414(s) include (i) compensation
within the meaning of Code Section 415(c)(3)
including or excluding reimbursements or other
expense allowances, fringe benefits (cash or
non-cash), moving expenses, deferred compensation
and welfare benefits, and (ii) any other
definition of compensation that is reasonable,
does not by design favor Highly Compensated
Employees and satisfies the nondiscrimination
requirements of Code Section 414(s) and the
regulations thereunder. Effective for Plan Years
beginning on and after January 1, 1989, and ending
prior to January 1, 1994, compensation for
purposes of this Section shall be limited to two
hundred thousand dollars ($200,000) or
20
such larger amount as determined pursuant to Code
Section 401(a)(17). Effective for Plan Years
beginning on and after January 1, 1994,
compensation for purposes of this Section shall be
limited to one hundred fifty thousand dollars
($150,000) or such other amount as authorized
pursuant to Code Section 401(a)(17).
(e) Only one (1) of the following two (2) tests need
be satisfied not to have a reduction in Salary
Redirection.
Test I - 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 one and twenty-five
hundredths (1.25).
Test II - The excess of the actual deferral
percentage for the group of Highly
Compensated Employees over the actual
deferral percentage for all other eligible
Employees is not more than two (2)
percentage points, and the actual deferral
percentage for the group of Highly
Compensated Employees is not more than the
actual deferral percentage for all other
eligible Employees multiplied by two (2.0).
Effective for Plan Years beginning after
December 31, 1988, if Test II in Subsection
3.5 (e) is used in testing other
contributions pursuant to that Section,
Test II under this Section shall be limited
as provided for in Code Section 401(m)(9)
and the regulations issued by the Secretary
of the Treasury or notices issued by the
Internal Revenue Service. If a multiple use
of Test II occurs, such multiple use shall
be corrected by reducing either the actual
deferral percentage or actual contribution
percentage of the Highly Compensated
Employees in an amount calculated in the
manner provided in Subsection (a) of this
Section or Subsection 3.5(a).
(f) If neither Test I nor Test II is satisfied for any
Plan Year, the Plan shall nevertheless be deemed
to comply with the requirements of Section
401(k)(3)(A)(ii) of the Code for such Plan Year
if, before the last day of the following Plan
Year, the amount of any excess contribution
(adjusted for income or loss for the Plan Year
computed using any reasonable method that
satisfies Code Section 401(a)(4) provided it is
used consistently for all Participants and for all
corrective distributions under the Plan for the
Plan Year and provided it is used by the Plan for
allocating income or loss to Participants'
Individual Accounts) is distributed to the
Participant. Unless a Participant elects otherwise
in the manner prescribed by the Committee, a
Participant receiving a distribution pursuant to
this Subsection 3.4(f) shall be deemed to have
made a Salary Redirection agreement of
Compensation (earned in the taxable year in which
such distribution is received) of up to the amount
21
of such distribution, subject to the limits of
Code Section 401(k), 402(g) and 415 for the Plan
Year such Salary Redirections are made. In the
event any excess contributions will be distributed
to the Participant, the Administrator may pay
these amounts to a Paying Agent. Prior to January
1, 1997, in the case of family aggregation
pursuant to Subsection 1.28(c), excess
contributions under this Section shall be
allocated to Participants who are subject to the
family aggregation rules of Code Section 414(q)(6)
in the manner prescribed by the regulations.
(g) This Section shall be governed by the rules of
Code Section 401(k), 401(a)(4) and any rules or
regulations issued pursuant thereto, including the
aggregation rules of Code Section 401(k)(3) and
the regulations thereunder.
Section 3.5 NONDISCRIMINATION TEST FOR OTHER CONTRIBUTIONS
(a) Periodically as determined by the Employer, the
Employer shall check the actual contribution
percentages against the tests identified below. In
the event that neither test is met, the Employer
shall reduce the Matching Contribution percentages
of Highly Compensated Employees that are above the
maximum contribution percentage allowed under the
tests. Beginning with the highest such percentage,
each contribution percentage shall be reduced to
the next highest percentage, and so forth, until
the excess is eliminated. If it is necessary to
reduce the Employer Matching Contribution the
Participant shall nevertheless receive from the
Plan a distribution equal to the Employer Matching
Contribution plus any income thereon that would
have been allocated to him had such reduction in
contribution not been necessary.
(b) The term "eligible Employees," for purposes of
this Section, shall mean all employees of the
Employer who are eligible to: make Salary
Redirection contributions, if the Employer elects
to take Salary Redirection into account, and
receive Matching Contributions during the Plan
Year for which the tests are being made.
(c) The term "actual contribution percentage," means
the average of the following percentages
(calculated separately for each eligible
Employee): Matching Contributions (and Salary
Redirection to the extent elected by the Employer
and permitted by Regulations under Code Section
401(m)) on behalf of each eligible Employee
divided by compensation of the eligible Employee.
In calculating the actual contribution percentage
of a Highly Compensated Employee who participates
in more than one arrangement of the Company
subject to Code Section 401(m), all arrangements
subject to Code Section 401(m) ending with or
within the same calendar year shall be treated as
a single arrangement.
22
(d) The term "compensation" for purposes of this
Section shall include amounts paid by the Company
to the Employee during the period he is eligible
to make Salary Redirection contributions and which
amounts are currently includable in the Employee's
gross income. For all Plan Years, the Company
shall have the right to increase the Employee's
compensation, for purposes of this Section, by the
amount of an Employee's salary redirection
elections under Code Section 125 (flexible benefit
plans), Section 402(g) (salary redirection) and
Section 402(h)(1)(B) (simplified employee plans),
or to use such alternative definition of
compensation as may be provided under Code Section
414(s). Alternate definitions of compensation
under Code Section 414(s) include (i) compensation
within the meaning of Code Section 415(c)(3)
including or excluding reimbursements or other
expense allowance, fringe benefits (cash or
non-cash), moving expenses, deferred compensation
and welfare benefits, and (ii) any other
definition of compensation that is reasonable,
does not by design favor Highly Compensated
Employees and satisfies the nondiscrimination
requirements of Code Section 414(s) and the
regulations thereunder. Effective for Plan Years
beginning on and after January 1, 1989, and ending
prior to January 1, 1994, compensation for
purposes of this Section shall be limited to two
hundred thousand dollars ($200,000 or such larger
amount as determined pursuant to Code Section
401(a)(17). Effective for Plan Years beginning on
and after January 1, 1994, compensation for
purposes of this Section shall be limited to one
hundred fifty thousand dollars ($150,000) or such
other amount as authorized pursuant to Code
Section 401(a)(17).
(e) Only one (1) of the following two (2) tests need
be satisfied not to have a reduction in
contributions tested pursuant to this Section.
Test I - 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 one and
twenty-five hundredths (1.25).
Test II - The excess of the actual
contribution percentage for the
group of Highly Compensated
Employees over the actual
contribution percentage for 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 for
all other eligible Employees
multiplied by two (2.0). Effective
for Plan Years beginning after
December 31, 1988, if Test II in
Subsection 3.4 (e) is used in
testing salary redirection pursuant
to that Section,
23
Test II under this Section shall be
limited as provided in Code Section
401(m)(9) and the regulations issued
by the Secretary of the Treasury or
notices issued by the Internal
Revenue Service. If a multiple use
of Test II occurs, such multiple use
shall be corrected by reducing
either the actual deferral
percentage or actual contribution
percentage of the Highly Compensated
Employees in an amount calculated in
the manner provided in Subsection
(a) of this Section or Subsection
3.4(a).
(f) If neither Test I nor Test II is satisfied for any
Plan Year, the Plan shall nevertheless be deemed
to comply with the requirements of Section 401(m)
of the Code for such Plan Year if, before the last
day of the following Plan Year, the amount of any
excess contribution (adjusted for income or loss
for the Plan Year computed using any reasonable
method that satisfies Code Section 401(a)(4)
provided it is used consistently for all
Participants and for all corrective distributions
under the Plan for the Plan Year and provided it
is used by the Plan for allocating income or loss
to Participants' Individual Accounts) is
distributed to the Participant, or if forfeitable,
is forfeited. In the case of family aggregation
pursuant to Section 1.28(c), excess contributions
under this Section shall be allocated to
Participants who are subject to the family
aggregation rules of Code Section 414(q)(6) in the
manner prescribed by regulations. For purposes of
this Section, the term "excess contributions"
means, with respect to any Plan Year, the excess
of:
(1) The aggregate amount of Matching
Contributions actually paid to the Trust
Fund on behalf of Highly Compensated
Employees for the Plan Year, over
(2) The maximum amount of such contributions
permitted under Subsection (e) of this
Section.
In the event that the tests in Subsection (e) of
this Section are performed on a restructured basis
pursuant to the regulations under Code Section
401(a)(4), excess contributions pursuant to this
Subsection may be determined on a restructured
basis.
(g) This Section shall be governed by Code Section
401(m), 401(a)(4) and any rules or regulations
issued pursuant thereto, including the aggregation
rules of Code Section 401(m)(2)(B) and the
regulations thereunder.
24
Section 3.6 MAXIMUM INDIVIDUAL DEFERRAL
A Participant shall not be permitted to have his
Employer redirect an amount in excess of seven
thousand dollars ($7,000) in any calendar year
pursuant to the provisions of Section 3.1 and
Section 8.3, including contributions to any other
plan of the Company, which are made pursuant to
Code Section 402(g)(1). The seven thousand dollar
($7,000) limitation shall be adjusted in
accordance with cost-of-living adjustments made by
the Secretary of the Treasury pursuant to Code
Section 402(g)(5). If any amount is redirected
pursuant to Section 3.1 and Section 8.3 in excess
of seven thousand dollars ($7,000), as adjusted,
or if a Participant notifies the Committee, in
writing, by March 1 following the close of the
taxable year, of its portion of the amount
contributed in excess of seven thousand dollars
($7,000), as adjusted, to all plans pursuant to
Code Section 402(g)(1), such amount shall be
deemed an "excess deferral" and the 401(k) Savings
Committee shall direct the Trustee to distribute
to the Participant (not later than April 15
following the calendar year in which the excess
deferral was made) the amount of the excess
deferral (adjusted for income or loss for the Plan
Year computed using any reasonable method that
satisfies Code Section 401(a)(4) provided it is
used consistently for all Participants and for all
corrective distributions under the Plan for the
Plan Year and provided it is used by the Plan for
allocating income or loss to Participants'
Accounts and reduced by any deferrals distributed
pursuant to Section 3.4).
Section 3.7 MISTAKE OF FACT
If due to a mistake of fact, Employer
Contributions to the Trust Fund for any Plan Year
exceed the amount intended to be contributed,
notwithstanding any provision to the contrary, the
Employer, as soon as such mistake of fact is
discovered, shall notify the Trustee. The Employer
shall direct that the Trustee return such excess
to the Employer, provided such return is made
within one (1) year of the date on which the
Employer made the contribution.
25
ARTICLE 4
ALLOCATIONS TO INDIVIDUAL ACCOUNTS
Section 4.1 INDIVIDUAL ACCOUNTS
The Committee shall establish and maintain an
Individual Account in the name of each Participant
to which the Committee shall credit all amounts
allocated to each such Participant pursuant to
Article 3 and the following Sections of this
Article. Effective January 1, 1998 the Committee
shall also credit all amounts allocated to each
such Participant pursuant to Article 7, Article 8,
Article 9, and Article 10, and effective August 1,
1998 Article 17.
Section 4.2 INVESTMENT OF ACCOUNTS
The Individual Account shall be invested by the
Trustee in accordance with the following:
(a) There shall be established the following
Investment Funds within the Trust Fund:
(1) Fidelity Retirement Government Money
Market Portfolio,
(2) Fidelity Ginnie Mae Portfolio, frozen
effective October 1, 1996,
(3) Fidelity Puritan Fund,
(4) Fidelity Spartan U. S. Equity Index
Portfolio,
(5) Fidelity Magellan Fund.
(6) Fidelity Contrafund, effective October 1,
1996,
(7) Fidelity Equity-Income II Fund, effective
October 1, 1996,
(8) Warburg Pincus Emerging Growth, effective
October 1, 1996,
(9) Templeton Foreign, effective October 1,
1996,
(10) Fidelity Intermediate Bond Fund, effective
October 1, 1996,
(11) LG&E Energy Corp. Common Stock Fund,
effective January 1, 1998.
26
(12) Janus Worldwide Fund, effective August 1,
1998.
(b) The Participant may direct the investments of
current contributions to his Individual Account
and the cumulative balance of his Individual
Account in increments of ten percent (10%), one
percent (1%) effective October 1, 1996, by giving
the Investment Manager such notice as it shall
require to be effective as soon as reasonably
possible.
(c) A Participant may transfer the cumulative balance
of his Individual Account, excluding the portion
attributable to his Prior ESOP Account. There
shall be no limit on the number of times a
Participant can change the direction as to the
investment of current contributions to his
Individual Account.
(d) A Participant who does not make any election under
this Section shall have the Individual Account and
current contributions made on his behalf invested
in the Retirement Government Money Market
Portfolio.
Section 4.3 VALUATION OF ACCOUNTS
(a) INDIVIDUAL ACCOUNT. As of each Valuation Date, the
Committee shall determine the fair market value of
the Individual Account of each Participant as
follows:
(1) The value of the Individual Account of
each Participant as of the last Valuation
Date;
(2) Minus the amount of any withdrawals and
distributions made from the Participant's
Individual Account since the last
Valuation Date;
(3) Plus any contributions to the separate
account in the Participant's Individual
Account established for contributions
pursuant to the following Sections since
the last Valuation Date: 3.1, 3.2, 3.3,
8.3, 8.4, 8.5;
(4) Plus any investment earnings allocated to
such Individual Account since the last
Valuation Date;
(5) Minus any investment losses allocated to
such Individual Account since the last
Valuation Date.
(b) INVESTMENT EARNINGS OR LOSSES. The investment
earnings (or losses, if such computation is
negative) from each Investment Fund shall mean the
net gain or loss of each Investment Fund from
investments, as reflected by interest payments,
dividends, realized and unrealized gains and
27
losses on securities, other investment
transactions and expenses paid from the fund. In
determining the investment earnings or losses of
the Investment Fund as of any date, assets shall
be valued on the basis of their fair market value
as of said date.
(c) ALLOCATION OF INVESTMENT EARNINGS OR LOSSES. The
investment earnings and losses from each
Investment Fund shall be allocated to the
Individual Account of each Participant invested in
the respective investment fund in such reasonable
and consistently applied manner as the Investment
Manager shall determine, provided that the
allocation is based on the relative market values
of the Participant's Individual Account.
Section 4.4 TRUSTEE AND COMMITTEE JUDGMENT CONTROLS
In determining the fair market value of the Trust
Fund and of Individual Accounts, the Trustee and
the Committee shall exercise their best judgment,
and all such determinations of value (in the
absence of bad faith) shall be binding upon all
Participants and their beneficiaries. All
allocations shall be deemed to have been made as
of the Valuation Date, regardless of when actual
allocations were undertaken.
Section 4.5 MAXIMUM ADDITIONS
Anything herein to the contrary notwithstanding,
the total Annual Additions of a Participant for
any Limitation Year when combined with any similar
annual additions credited to the Participant for
the same period from another qualified Defined
Contribution Plan maintained by the Company, shall
not exceed the lesser of the amounts determined
pursuant to Subsection (a) or (b) of this Section.
(a) Thirty thousand dollars ($30,000) or, if greater,
twenty-five percent (25%) of the dollar limitation
in effect under Code Section 415(b)(1)(A); or
(b) Twenty-five percent (25%) of the Participant's
compensation received from the Company for such
Limitation Year, as determined pursuant to Section
415 of the Code.
(c) In the event a Participant is covered by one or
more Defined Contribution Plans maintained by the
Company, the maximum annual additions as noted
above shall be decreased in any other Defined
Contribution Plan as determined necessary by the
Company, prior to a reduction of this Plan, to
ensure that all such plans will remain qualified
under the Code.
28
Section 4.6 CORRECTIVE ADJUSTMENTS
In the event that corrective adjustments in the Annual Addition to any
Participant's Individual Account are required as the result of allocating
forfeitures, a reasonable error in estimating a Participant's compensation,
a reasonable error in determining the amount of elective deferrals (within
the meaning of Code Section 402(g)(3)) that may be made with respect to an
individual under the limits of Code Section 415, or such other facts and
circumstances as may be provided for by rules or regulations issued
pursuant to Code Section 415, the corrective adjustments shall be made
pursuant to and in the order of the Subsections in this Section 4.6.
Effective January 1, 1996, unless a Participant elects otherwise in the
manner prescribed by the Committee, a Participant receiving a distribution
under this Section 4.6 shall be deemed to have made a Salary Redirection
agreement of Compensation (earned in the taxable year in which such
distribution is received) equal to the amount of such distribution, subject
to the limits of Code Section 401(k), 402(g) and 415 for the Plan Year such
Salary Redirections are made. In the event any excess Annual Additions will
be distributed to the Participant, the Committee may pay these amounts to
the Paying Agent.
(a) The portion of the Participant's unmatched Salary
Redirection shall be reduced to insure compliance
with Section 4.5. Any affected Salary Redirection
will be distributed to the Participant.
(b) The portion of the Participant's matched Salary
Redirection and his Matching Contributions shall
be proportionally reduced to insure compliance
with Section 4.5. Any affected Salary Redirection
will be distributed to the Participant. Any
affected Matching Contributions shall be used to
reduce future Matching Contributions.
Section 4.7 DEFINED CONTRIBUTION AND DEFINED BENEFIT PLAN FRACTION
If a Participant is a participant in a Defined
Benefit Plan maintained by the Company, the sum of
his defined benefit plan fraction and his defined
contribution plan fraction for any Limitation Year
may not exceed one (1.0).
(a) For purposes of this Section, the term "defined
contribution plan fraction" shall mean a fraction
the numerator of which is the sum of all of the
Annual Additions of the Participant under this
Plan and any other Defined Contribution Plan
maintained by the Company as of the close of the
Limitation Year and the denominator of which is
the sum of the lesser of the following amounts
determined for such Limitation Year and for each
prior Limitation Year of employment with the
Company:
29
(1) The product of one and twenty-five
hundredths (1.25) multiplied by the dollar
limitation in effect under Section
415(c)(1)(A) of the Code; or
(2) The product of one and forty hundredths
(1.4) multiplied by the amount which may be
taken into account under Code Section
415(c)(1)(B) with respect to each
individual under the Plan for such
Limitation Year.
(b) For purposes of this Section, the term, "defined
benefit plan fraction" shall mean a fraction the
numerator of which is the Participant's projected
annual benefit (as defined in the Defined Benefit
Plan) determined as of the close of the Limitation
Year and the denominator of which is the lesser
of:
(1) The product of one and twenty-five
hundredths (1.25) multiplied by the dollar
limitation in effect pursuant to Section
415(b)(1)(A) of the Code for such
Limitation Year; or
(2) The product of one and forty hundredths
(1.4) multiplied by the amount which may be
taken into account pursuant to Section
415(b)(1)(B) of the Code with respect to
each individual under the Plan for such
Limitation Year.
(c) The limitation on aggregate benefits from a
Defined Benefit Plan and a Defined Contribution
Plan which is contained in Section 2004 of ERISA,
as amended, shall be complied with by a reduction
(if necessary) in the Participant's benefits under
the Defined Benefit Plan.
30
ARTICLE 5
DISTRIBUTIONS
Section 5.1 NORMAL RETIREMENT
When a Participant lives to his Normal Retirement
Date and retires, he shall become entitled to the
full value of his Individual Account as of the
Valuation Date on which the distribution is made.
Section 5.2 EARLY RETIREMENT
When a Participant lives to his Early Retirement
Date and retires, he shall become entitled to the
full value of his Individual Account as of the
Valuation Date on which the distribution is made.
Section 5.3 LATE RETIREMENT
A Participant may continue his employment past his
Normal Retirement Date on a year to year basis. He
shall continue to be an active Participant under
the Plan. Upon his actual retirement, he shall
become entitled to the full value of his
Individual Account of the Valuation Date on which
the distribution is made.
Section 5.4 DEATH
If a Participant dies while an active Participant
under the Plan, his Beneficiary shall be entitled
to the full value of his Individual Account as of
the Valuation Date on which the distribution is
made.
Section 5.5 DISABILITY
When it is determined that a Participant is
Totally and Permanently Disabled, the Committee
shall certify such fact to the Trustee and such
Disabled Participant shall be entitled to receive
the full value of his Individual Account as of the
Valuation Date on which the distribution is made.
Section 5.6 TERMINATION OF EMPLOYMENT
Upon termination of employment with the Company
for any reason (other than Normal Retirement, Late
Retirement, total and permanent Disability, or
Death), a Participant shall be entitled to a
benefit equal to the full value of his Individual
Account as of the Valuation Date on which the
distribution is made.
31
Section 5.7 COMMENCEMENT OF BENEFITS
(a) Any benefits payable under this Article shall be
paid as soon as reasonably possible following the
date of severance from the Company, subject to the
Participant's consent. Unless the Participant
elects otherwise, payment shall begin no later
than sixty (60) days after the last day of the
Plan Year in which occurs the latest of (i) the
Participant's reaching Normal Retirement Age; (ii)
the tenth (10th) anniversary of the date the
Employee became a Participant; or (iii)
termination of the Participant's employment. The
Participant may defer distribution to a subsequent
date unless his benefit may be cashed out without
his consent pursuant to Subsection 5.9, or unless
he is subject to Section 5.8 as a result of
attaining age seventy and one-half (70 1/2).
(b) If the Participant does not consent to a
distribution as provided above, such distribution
shall be made based on the value of the Individual
Account as of the Valuation Date coincident with
or immediately preceding the receipt of notice by
the Committee of the election to receive a
distribution. Such distribution shall be made as
soon as reasonably possible following such
Valuation Date.
Section 5.8 MINIMUM DISTRIBUTIONS
(a) The Individual Account of all Participants must be
distributed or commence to be distributed no later
than April 1 following the calendar year in which
such individual attains age seventy and one-half
(70-1/2) unless such individual has effectively
executed a waiver prior to January 1, 1984, in
accordance with the Code and notices and
regulations issued thereunder. However, if the
Participant was not a five percent (5%) owner in
any Plan Year after attaining age sixty-five and
one-half (65-1/2) and had attained age seventy and
one-half (70-1/2) prior to January 1, 1988,
distributions to said Participant must commence no
later than the April 1 following the calendar year
in which the later of termination of employment or
age seventy and one-half (70-1/2) occurs, or the
Participant becomes a five percent (5%) owner.
Effective June 1, 1998 for a Participant who
attains age seventy and one-half (70-1/2) while
actively at work, distributions to said
Participant must commence no later than the April
1 following the calendar year in which the later
of termination of employment, or the Participant
becomes a five percent (5%) owner.
(b) All distributions required under this Article
shall be determined and made in accordance with
the Proposed Regulations under Section 401(a)(9),
including the minimum distribution incidental
benefit
32
requirement of Section 1.401(a)(9)-2 of the
proposed regulations.
Section 5.9 METHODS OF PAYMENT
(a) A Participant or Beneficiary shall elect a
distribution of the Individual Account as provided
hereinafter. No other manner of distribution shall
be provided. The request by the Participant or the
Beneficiary shall be in writing and shall be filed
with the Committee at least thirty (30) days
before distribution is to be made. Effective June
1, 1998, the request by the Participant or the
Beneficiary shall be in a manner and time
prescribed by the Committee. The Committee may not
require a distribution without the consent of the
Participant prior to his reaching the later of
Normal Retirement Age or, if the Participant is
deceased, without the consent of his spouse, if
living, or of his Beneficiary, unless the vested
value of the Individual Account is not more than
three thousand five hundred dollars ($3,500) or
effective June 1, 1998 five thousand dollars
($5,000). If the vested value of the Participant's
Individual Account is less than three thousand
five hundred dollars ($3,500) ) or effective June
1, 1998 five thousand dollars ($5,000), the
benefits payable will be paid as soon as
reasonably possible following the actual date of
severance, notwithstanding lack of consent. If the
vested value of the Participant's Individual
Account has been more than three thousand five
hundred dollars ($3,500) at the time of any
distribution, the value the Participant's
Individual Account will be deemed to be more than
three thousand five hundred dollars ($3,500) at
the time of any subsequent distribution for
purposes of the consent requirements of this
paragraph. Notwithstanding the above, no lump sum
distribution may be made after periodic payments
have commenced unless the Participant or the
Participant's surviving spouse consents in writing
to the distribution. The alternative forms of
distribution are as follows:
(1) A lump sum distribution in cash or in
kind; or
(2) Periodic installment payments (either
monthly or annually) for a period not to
exceed ten (10) years as selected by the
Participant or Beneficiary; or
(3) Any combination of the above.
(b) If the Participant dies after the periodic
installment payments commence but before the
Individual Account is fully distributed, the
balance remaining in the Individual Account shall
be paid out over the periods remaining pursuant to
the Participant's election under item (2) or (3)
of Subsection (a) of this Section, or, if the
Beneficiary elects, such other period as is
allowed under this Section.
33
(c) Any payment provided for in this Section may not
extend beyond the life expectancy of the
Participant or the joint and last survivor
expectancy of the Participant and designated
Beneficiary.
(d) If the Participant dies before distribution occurs
or commences, the Participant's entire interest
will be distributed no later than five (5) years
after the Participant's death, except to the
extent that an election is made to receive
distributions in accordance with (1) or (2) below:
(1) If any portion of the Participant's
interest is payable to a designated
Beneficiary, distributions may be made in
substantially equal installments over the
life or life expectancy of the designated
Beneficiary commencing no later than one
(1) year after the Participant's death.
(2) If the designated Beneficiary is the
Participant's surviving spouse, the date
distributions are required to be made or
commence shall not be earlier than the date
on which the Participant would have
attained age sixty-five (65). If the spouse
dies before payments begin, any subsequent
distribution shall be made as if the spouse
had been the Participant.
(e) Notwithstanding any settlement option contained in
this Plan, the benefits payable to the Beneficiary
of any Participant must be incidental to the
primary purpose of distributing accumulated funds
to the Participant, and if the Participant's
designated Beneficiary or survivor is other than
his spouse, the settlement option shall not
violate Code Section 401(a)(9).
(f) This Plan specifically permits a distribution to
an alternate payee under a qualified domestic
relations order at any time, irrespective of
whether the Participant has attained his earliest
retirement age under the Plan. Nothing in this
Section 5.9 gives a Participant a right to receive
a distribution at a time otherwise not permitted
under the Plan nor does it permit the alternate
payee to receive a form of payment not permitted
under the Plan.
Section 5.10 BENEFITS TO MINORS AND INCOMPETENTS
(a) In case any person entitled to receive payment
under the Plan shall be a minor, the Committee, in
its discretion, may dispose of such amount in any
one or more of the ways specified in items (1)
through (3) of this Subsection.
(1) By payment thereof directly to such minor;
34
(2) By application thereof for benefit of such
minor;
(3) By payment thereof to either parent of such
minor or to any adult person with whom such
minor may at the time be living or to any
person who shall be legally qualified and
shall be acting as guardian of the person
or the property of such minor; provided
only that the parent or adult person to
whom any amount shall be paid shall have
advised the Committee in writing that he
will hold or use such amount for the
benefit of such minor.
(b) In the event that it shall be found that a person
entitled to receive payment under the Plan is
physically or mentally incapable of personally
receiving and giving a valid receipt for any
payment due (unless prior claim therefor shall
have been made by a duly qualified committee or
other legal representative), such payment may be
made to the spouse, son, daughter, parent,
brother, sister or other person deemed by the
Committee to have incurred expense for such person
otherwise entitled to payment.
Section 5.11 UNCLAIMED BENEFITS
If, after diligent effort, a Participant, spouse
or Beneficiary who is entitled to a distribution
cannot be located within a reasonable period of
time after the date such distribution was to
commence, the distributable Individual Account
balance shall be deposited in such separate
account as the Trustee shall determine. The
separate account shall be registered in the name
of the person entitled to the distribution. The
balance in such separate account shall be
forfeited on the fifth (5th) anniversary of the
Participant's termination of employment, or such
later date as the Committee may determine, and
shall be used to reduce future Employer
Contributions. If the Participant, spouse or
Beneficiary subsequently presents a valid claim
for the benefit to the Committee, the Committee
shall cause the benefit, equal to the amount which
was forfeited under this Section, to be restored,
first from forfeitures and then from Employer
Contributions.
Section 5.12 PARTICIPANT DIRECTED ROLLOVERS
(a) Any Participant, spouse or alternate payee under a
qualified domestic relations order entitled to
receive an eligible rollover distribution on or
after January 1, 1993, may elect, pursuant to Code
Section 401(a)(31) and the rules and regulations
issued pursuant thereto, to have such distribution
paid directly to an eligible retirement plan. The
election shall be made in such form and in such
manner as the Employer may require, consistent
with the rules and regulations issued pursuant to
Code Section 401(a)(31).
35
(b) For purposes of Subsection (a) of this Section, an
eligible rollover distributions is a distribution
of all or any portion of the balance to the credit
of the distributee, excluding any distribution
which is (i) one of a series of substantially
equal periodic payments (not less frequently than
annually) made for the life (or life expectancy)
or the joint lives (or joint life expectancies) of
the recipient and the recipient's designated
beneficiary; (ii) for a specified period of ten
(10) years or more; or (iii) is required to be
made under Code Section 401(a)(9). An eligible
retirement plan is an individual retirement
account described in Code Section 408(a), an
individual retirement annuity described in Code
Section 408(b) (other than an endowment contract),
a trust described in Code Section 401(a) that is
exempt from tax under Code Section 501(a), or an
annuity plan described in Code Section 403(a).
(c) A distributee includes an Employee or Former
Employee. In addition, the Employee's or Former
Employee's surviving spouse and the Employee's or
Former Employee's spouse or former spouse who is
the alternate payee under a qualified domestic
relations order, as defined in Section 414(p) of
the Code, are distributees with regard to the
interest of the spouse or former spouse.
(d) Notwithstanding any provision of the Plan to the
contrary that would otherwise limit a
distributee's election under this Article, a
distributee may elect, at the time and in the
manner prescribed by the Plan administrator, to
have any portion of an eligible rollover
distribution paid directly to an eligible
retirement plan specified by the distributee in a
direct rollover.
(e) A direct rollover is a payment by the plan to the
eligible retirement plan specified by the
distributee.
36
ARTICLE 6
WITHDRAWALS AND LOANS
Section 6.1 HARDSHIP WITHDRAWAL
(a) Except as otherwise provided in this Section, in
such time and manner as the Committee may specify,
the Committee in its sole discretion may permit
the Participant to withdraw a portion or all of
the balance of his Salary Redirection Account;
provided that earnings allocated to such Account
after December 31, 1988, may not be withdrawn.
Such withdrawal shall be based on the value of the
Account on the Valuation Date as of which the
withdrawal is paid; provided, however, the
Committee may defer the withdrawal if it is in the
best interest of the Participant requesting the
withdrawal or the other Participants.
(b) The reason for a withdrawal pursuant to this
Section must be to enable the Participant to meet
unusual or special situations in his financial
affairs resulting in immediate and heavy financial
needs of the Participant. Such situations shall be
limited to:
(1) Medical expenses (described in Code Section
213(d)) previously incurred by the
Participant, the Participant's spouse or
any dependents of the Participant (as
defined in Code Section 152) or necessary
for these persons to obtain medical care
described in Code Section 213(d);
(2) Purchase (excluding mortgage payments) of a
principal residence for the Participant;
(3) Payment of tuition and related educational
fees for the next twelve (12) months of
post-secondary education for the
Participant, his or her spouse, children,
or dependents (as defined in Code Section
152);
(4) The need to prevent the eviction of the
Participant from his principal residence or
foreclosure on the mortgage of the
Participant's principal residence; or
(5) Any additional items which may be added to
the list of deemed immediate and heavy
financial needs by the Commissioner of
Internal Revenue through the publication of
revenue rulings, notices, and other
documents of general applicability.
37
Any withdrawal hereunder may not exceed the amount
required to meet the immediate financial need
created, and provided further that such amount
must not be reasonably available from other
resources of the Participant. The amount of an
immediate and heavy financial need shall include
any federal, state, or local taxes or penalties
reasonably anticipated to result from the
distribution.
(c) The minimum amount of withdrawal a Participant may
make pursuant to this Section shall be one
thousand dollars ($1,000).
(d) The Committee may shorten the notice period if it
finds it is administratively feasible. In granting
or refusing any request for withdrawal or in
shortening the notice period, the Committee shall
apply uniform standards consistently and such
discretionary power shall not be applied so as to
discriminate in favor of Highly Compensated
Employees.
(e) The withdrawals under this Section shall in no way
affect said Participant's continued participation
in this Plan except by the reduction in account
balances caused by such withdrawals and except as
provided in Subsection (f) of this Section.
(f) If a Participant withdraws Salary Redirection
pursuant to the provisions of this Section, the
following provisions of this Subsection shall
apply and the Committee shall deem that such
amount requested for withdrawal is not reasonably
available from other resources of the Participant.
(1) A withdrawal may be made pursuant to this
Section only after the Participant has
obtained all distributions other than
hardship distributions, and all non-taxable
loans available under this Plan and all
other plans maintained by the Company.
(2) Elective contributions and employee
contributions under this Plan and all other
plans maintained by the Company will be
suspended for twelve (12) months after
receipt of the withdrawal of Salary
Redirection pursuant to this Section.
(3) The limitation provided for in Section 3.6
for the taxable year of the Participant
following the taxable year of the
withdrawal pursuant to this Section shall
be reduced by the amount of the
Participant's Salary Redirection and other
elective contributions for the taxable year
of the Participant during which the
withdrawal pursuant to this Section is
taken.
38
Section 6.2 PARTICIPANT LOANS
(a) Upon proper application of a Participant or
Beneficiary (which, for purposes of this Section,
shall mean any person who is a party in interest
as defined in Section 3(14) of the Employee
Retirement Income Security Act of 1974 and who has
a vested interest in his Individual Account), made
in such form as the Investment Manager may
specify, the Investment Manager may make a loan to
the Participant or Beneficiary from his Individual
Account. Notwithstanding the preceding sentence, a
loan shall not be made to a non-active Participant
that may result in discrimination under Code
Section 401(a)(4). The application, and the
resulting loan, must meet the terms and conditions
specified in the following of this Section and the
approval or denial of a loan request will be made
on the basis of whether the loan would meet these
requirements.
(b) The total amount of all loans shall not exceed the
lesser of:
(1) Fifty thousand dollars ($50,000), reduced
by the highest outstanding balance of loans
from the Plan during the one (1) year
period ending on the day before the loan is
made; or
(2) One-half (1/2) the value of the
Participant's Individual Account under the
Plan as of the date of the loan minus the
outstanding balance of all other loans from
the Plan as of the date of the loan.
(c) The amount of any loan must be at least one
thousand dollars ($1,000).
(d) No more than four (4) loans may be outstanding to
any Participant at any one time. No Participant
may refinance a loan at any time.
(e) The Investment Manager shall credit interest and
principal payments made by a Participant,
including payments made pursuant to Subsection (g)
of this Section, against his loans evidenced by
promissory notes held as earmarked assets of his
Individual Account, to the Trust Fund.
(f) The maximum term of repayment for any loan shall
be five (5) years. Notwithstanding the preceding
sentence, the maximum term of any loan for a
principal residence made under the Prior LNI Plan
or Prior LPI Plan made prior to January 1, 1998,
shall be fifteen (15) years.
(g) The Participant shall authorize his Employer to
deduct approximately equal interest and principal
payments from his compensation payable at the end
of each regular pay period (no less frequently
than quarterly) in an amount equal to at least ten
dollars ($10.00) with respect to each outstanding
loan. In the event an inactive Participant or
Beneficiary
39
receives a loan hereunder or in the event that a
Participant who received a loan ceases to be
actively employed by the Company, repayments shall
be made to the Committee pursuant to the terms of
the promissory note (no less frequently than
quarterly). The Committee shall transfer payments
under this Subsection to the Investment Manager
within a reasonable period of time.
(h) A Participant may repay, at any time, any portion
or all of the then outstanding principal balance
of any of his loans, together with interest due to
date on the prepaid portion. Any such prepayments
shall be made to the Investment Manager. Except as
otherwise provided in Subsection (j) of this
Section, such right of prepayment shall be
entirely in the discretion of the Participant and
shall be without premium or penalty.
(i) The collateral for each loan shall be the
assignment of a percentage, sufficient for the
amount of the loan, of up to fifty percent (50%)
of the Participant's Individual Account as of the
date the loan is made, supported by the
Participant's promissory note for the amount of
such loan, including interest, payable to the
order of the Trustee.
(j) Each loan shall bear interest at a reasonable rate
to be fixed by the Investment Manager which shall
be based on interest rates currently being charged
for loans by commercial lending institutions in
the same geographical area as the situs of the
Trust. The Investment Manager shall not
discriminate among Participants in the matter of
interest rate; but loans granted at different
times may bear different interest rates if, in the
opinion of the Investment Manager, different rates
are required based on the rates being charged by
commercial lending institutions.
(k) The terms of the promissory note for each loan
shall provide that if a Participant with an
outstanding loan balance defaults on the loan
prior to the earlier of termination of employment
with the Company or attainment of age fifty-nine
and one-half (59-1/2), interest shall continue to
accrue on the outstanding principal balance at the
stated rate, and shall be added to the principal
balance as it accrues. If the Participant resumes
loan repayments, such repayment of both principal
and interest shall be based on the outstanding
loan balance on the date repayments resume. The
term of the loan, as originally stated, shall be
adjusted so that the period during which the
Participant was in default will be disregarded.
If, on the earlier of termination of employment
with the Company or attainment of age fifty-nine
and one-half (59-1/2), loan repayments have not
resumed, the end of the term of the loan will be
deemed to have been reached. In such event, either
Subsection (k) of this Section shall apply or, if
applicable, the Participant shall be deemed to
have made a withdrawal equal to the then
outstanding principal
40
balance of the loan. Such deemed withdrawal shall
be treated as a distribution to which Subsection
(l) of this Section applies.
(l) No distribution under Article 5 shall be made to
any Participant, Former Participant or Beneficiary
unless and until all unpaid loans, including
accrued interest, have been repaid. Such
Participant, Former Participant or Beneficiary
shall have the option of paying the unpaid loan
balance and accrued interest directly or having
such amount deducted from the distribution.
The terms of each promissory note shall provide
that in the event of default, the Participant
shall be deemed to consent to a lump sum
distribution at the earliest date a distribution
can be made under the Plan equal to the unpaid
loan balance and accrued interest.
(m) In granting or refusing any request for a loan,
the Investment Manager shall apply uniform
standards consistently and such discretionary
power shall not be applied to discriminate in
favor of Highly Compensated Employees.
41
ARTICLE 7
EMPLOYEE STOCK OWNERSHIP PLAN
Section 7.1 PURPOSE AND EFFECTIVE DATE
Effective January 1, 1998, the Company hereby
establishes and designates the LG&E Energy Corp.
Common Stock Fund as an Employee Stock Ownership
Plan (ESOP)to enable eligible Participants to
acquire stock ownership interests in the Company.
Section 7.2 INVESTMENT IN COMPANY STOCK
The ESOP is designed to invest primarily in
Company Stock and all accounts under this Article
shall be invested in the LG&E Energy Corp. Common
Stock Fund.
Section 7.3 PRIOR ESOP ACCOUNTS
(a) PARTICIPATION
An individual with a Prior ESOP Account shall
automatically become a Participant in the Plan at
the time of the transfer of their prior ESOP
balance. ,
(b) VESTING
That portion of the Participant's Individual
Account attributable to the Prior ESOP Account
shall be fully-vested and non-forfeitable under
the Plan.
(c) WITHDRAWALS
Pursuant to the procedures adopted by the
Administrator, including but not limited to the
establishment of minimum amounts, a Participant
may elect to have distributed to him any portion
or all of his Prior ESOP Account.
(d) TRANSFERS
Notwithstanding the provisions of Subsection
4.2(c) and Section 7.2, effective January 1,1998,
a Participant, Former Participant, or Beneficiary
after reaching age fifty five (55), may transfer
the balance of his Prior ESOP Account from the
LG&E Energy Corp. Common Stock Fund to any of the
Investment Funds in the Plan.
42
Section 7.4 GENERAL ESOP PROVISIONS
(a) PAYMENT OF BENEFITS
Effective January 1, 1998, Payments of amounts
invested in the LG&E Energy Corp. Common Stock
Fund shall be in the form of a lump sum. Unless
the Participant elects otherwise, the distribution
shall be made no later than one (1) year after the
close of the Plan Year in which the Participant
terminates employment due to death, Total and
Permanent Disability or Retirement and no later
than five (5) years after the close of the Plan
Year in which Participant terminates employment
for any other reason.
(b) CONTRIBUTIONS
Effective January 1, 1998, the Company shall
contribute to the Trustee cash equal to, or
Company Stock having an aggregate fair market
value equal to, such amounts required by Section
3.2 and Section 8.4 of the Plan to the ESOP.
Contributions by Participants are not required,
but shall be permitted in accordance with Section
3.1 and Section 8.3.
Section 7.5 PUT OPTION
Effective January 1, 1998, if the Company Stock is
or becomes not readily tradable on an established
market, then any Participant, who is otherwise
entitled to a distribution for the Plan, shall
have the right (hereinafter referred to as "Put
Option") to require that the Corporation
repurchase any Company Stock at the price
established by a valuation conducted by an
independent appraiser (as established in Section
401(a)(28) of the Code). The Put Option shall only
be exercisable during the sixty (60) day period
immediately following the date of distribution and
if the Put Option is not exercised within such
sixty (60) day period, then it can be exercised
for an additional period of sixty (60) days in the
following Plan Year. This Put Option shall be
nonterminable with the meaning of Regulation
54.4975-(11)(a)(ii).
The amount paid for the Company Stock under the
Put Option shall be paid in substantially equal
payments (not less frequently than annually) over
a period beginning not later than thirty (30) days
after the exercise of the Put Option and not
exceeding five (5) years. There shall be adequate
security provided and reasonable interest paid on
the unpaid balance due under this paragraph.
43
Section 7.6 LOANS
(a) AUTHORIZATION OF LOAN
Effective January 1, 1998, the Board of Directors
may direct the Trustee to incur a loan on behalf
of the Trust in a manner and under conditions
which will cause the loan to be an "exempt loan"
within the meaning of Section 4975(d)(2) of the
Code and Regulations thereunder. A loan shall be
used primarily for the benefit of Plan
Participants and their Beneficiaries. The proceeds
of each such loan shall be used, within a
reasonable time after the loan is obtained, only
to purchase Company Stock, to repay the loan or to
repay any prior loan. Any such loan shall provide
for a reasonable rate of interest, an
ascertainable period of maturity and shall be
without recourse against the Plan. Any such loan
shall be secured solely by shares of Company Stock
acquired with the proceeds of the loan and shares
of such stock that were used as collateral on a
prior loan which was repaid with the proceeds of
the current loan. Such stock pledged as collateral
shall be placed in a Suspense Account and released
pursuant to Subsection 7.06(b), as the loan is
repaid. Company Stock released from the Suspense
Account shall be allocated in the ratio that each
eligible Participant's Compensation, bears to the
total Compensation, paid to all Participants
during the Plan Year. No person entitled to
payment under a loan made pursuant to this Section
shall have recourse against any Trust Fund assets
other than the stock used as collateral for the
loan, Sponsoring Employer contributions of cash
that are available to meet obligations under the
loan and earnings attributable to such collateral
and the investment of such contributions. Employer
contributions made with respect to any Plan Year
during which the loan remains unpaid, and earnings
on such contributions, shall be deemed available
to meet obligations under the loan, unless
otherwise provided by the Employer at the time
such contributions are made.
(b) RELEASE OF COMPANY STOCK
Any pledge of stock as collateral under this
Section shall provide for the release of shares so
pledged upon the payment of any portion of the
loan. Shares so pledged shall be released in the
proportion of the principal and interest, paid on
the loan for the Plan Year bears to the aggregate
principal and interest, paid for the current Plan
Year and each Plan Year thereafter, as provided in
Regulation 54.4975-7(b)(8).
(c) REPAYMENT OF THE LOAN
Payments of principal and interest on any loan
under this Section shall be made by the Trustee at
the direction of the Committee solely from: (i)
employer contributions available to meet
obligations under the loan, (ii)
44
earnings from the investment of such
contributions, (iii) earnings attributable to
stock pledged as collateral for the loan, (iv)
other dividends on stock to the extent permitted
by law, (v) the proceeds of a subsequent loan made
to repay the loan, and (vi) the proceeds of the
sale of any stock pledged as collateral for the
loan. The contributions and earnings available to
pay the loan must be accounted for separately by
the Committee until the loan is repaid.
(d) ALLOCATIONS TO INDIVIDUAL ACCOUNT
Subject to the limitations in Section 4.5 on
annual additions to a Participant's Individual
Account, assets released from a Suspense Account
by reason of payment made on a loan shall be
allocated immediately upon such payment to the
account of all Participants who then would be
entitled to an allocation of contributions if such
payment had been made on the last day of the Plan
Year.
Section 7.7 DISPOSITION OF DIVIDENDS ON COMPANY STOCK
(a) DISTRIBUTION TO DIVIDEND ELIGIBLE PARTICIPANT
Effective January 1, 1998, the Trustee shall
distribute dividends paid on Company Stock to a
Dividend Eligible Participant, no later than
ninety (90) days after the end of the Plan year
which said dividends are paid.
(b) ALLOCATION OF DIVIDEND TO INDIVIDUAL ACCOUNTS
Effective January 1, 1998, the Trustee shall
allocate dividends paid on Company Stock, which
are not otherwise distributed to Dividend Eligible
Participants under Subsection 7.7(a) of this
Section, to the Individual Account as provided for
in Section 4.3 of the Plan.
Section 7.8 VOTING OF STOCK AND OTHER STOCK RIGHTS
(a) VOTING
Common Stock, including fractional shares, held by
the Trustee for a Participant's Individual Account
and invested in the LG&E Energy Corp. Common Stock
Fund, shall be voted by the Trustee at each annual
meeting and at each special meeting of the
stockholders of the Company at the direction of
the Participant to whose Individual Account such
stock is credited to the extent such vote would be
consistent with the Trustee's duties under ERISA.
The Trustee shall cause each Participant to be
provided with a copy of a notice of each such
stockholder meeting and the proxy statement of the
Company, together with the appropriate form for
the Participant to indicate his voting
instructions. If the instructions are
45
not timely received by the Trustee with respect to
such stock, the Trustee shall vote the
uninstructed stock in the same proportion as the
instructed stock to the extent such vote would be
consistent with the Trustee's duties under ERISA.
(b) TENDER OFFER
Common Stock, including fractional shares, held by
the Trustee for a Participant's Individual Account
and invested in the LG&E Energy Corp. Commons
Stock Fund, shall be tendered by the Trustee
pursuant to a tender offer as directed by the
Participant to whose Individual Account such stock
is credited to the extent such tender would be
consistent with the Trustee's duties under ERISA.
The Trustee shall cause each Participant to be
provided with notice of any such tender offer as
the Trustee receives as a holder of record, and
which the Trustee reasonably believes also was
received by shareholders generally, as soon as
practicable after the Trustee receives such
statements or information, together with an
appropriate form for the Participant to indicate
his or her instruction regarding any such tender
offer. If instructions are not timely received by
the Trustee with respect to any such stock or if
there is any unallocated stock, the Trustee shall
tender the shares of such uninstructed or
unallocated stock in the same proportion as the
Trustee actually receives timely instruction to
tender shares of stock to the extent such tender
would be consistent with the Trustee's duties
under ERISA.
Section 7.9 SECTION 16 COMPLIANCE
It is the intention of the Company that the Plan
and the administration of the Plan comply in all
respects with Section 16 of the Securities
Exchange Act of 1934 (the "Act"), as amended and
the rule and regulation promulgated thereunder. If
any Plan provision, or any aspect of the
administration of the Plan, is found not to be in
compliance with Section 16 of the Act, the
provision or administration shall be deemed null
and void, and in all events the Plan shall be
construed in favor of its meeting the requirements
of Rule 16b-3 promulgated under the Act.
Notwithstanding anything in the Plan to the
contrary, the Committee, in its discretion, may
bifurcate the Plan so as to restrict, limit or
condition the use of any provision of the Plan to
Participants who are subject to Section 16 of the
Act without so restricting, limiting or
conditioning the Plan with respect to other
Participants.
46
ARTICLE 8
PROVISIONS RELATING TO ENERGY MARKETING EMPLOYEES
Section 8.1 ELIGIBILITY
Effective for the 1998 Plan Year a Participant who
is employed with a Participating Employer listed
on Appendix B shall be eligible to participate
under this Article 8.
Section 8.2 PROFIT SHARING CONTRIBUTIONS
(a) AMOUNT OF PROFIT SHARING CONTRIBUTIONS
As of each December 31 Valuation Date for each
Plan Year, beginning with the 1998 Plan Year, each
Participating Employer shall contribute to the
respective Profit Sharing Account of Participants
who are entitled to allocations under Subsection
8.2(b) such Participating Employer's net profit
for the taxable year ending with or within such
Plan Year in the amount of three percent (3%). In
the discretion of the Board of Directors, such
contribution may be increased or decreased. Such
Profit Sharing Contribution shall not exceed the
lesser of the amount deductible under Section 404
of the Code, or the amount that are allowable as
Annual Additions.
(b) ALLOCATION OF PROFIT SHARING CONTRIBUTIONS
Each Participating Employer's contribution under
Subsection 8.2(a) shall be allocated to the Profit
Sharing Account of Participants who are actively
employed as of December 31 of the Plan Year who
have been credited with at least one thousand
(1,000) Hours of Service during their Employment
Year that ends in the Plan Year for which the
Profit Sharing Contribution is being made, and
those who have retired on or after their Normal
Retirement Dates, died or become Totally and
Permanently Disabled during the Plan Year.
Section 8.3 SALARY REDIRECTION CONTRIBUTIONS
Each Employee employed by an Employer listed on
Appendix B who satisfies the requirements of
Section 2.1 may elect to have Salary Redirection
made on his behalf, commencing on the date
specified in Section 2.1. Notwithstanding the
foregoing, an Employee who was a Participant in
the Prior LNI Plan shall be immediately eligible
to participate in the Plan. Such election shall be
made by entering into a
47
Salary Redirection agreement with the Employer in
which it is agreed that the Employer will redirect
a portion of the Participant's Compensation and
contribute that designated amount to the Trust
Fund on behalf of the Participant in accordance
with the following.
(a) SALARY REDIRECTION AGREEMENT. Each eligible
Employee may enter into a Salary Redirection
agreement under which the Employee's Employer will
redirect a portion of the Participant's
Compensation during each payroll period in an
amount equal to an integral percentage from one
percent (1%) to sixteen percent (16%) of such
Compensation and contribute such percentage to the
Trust Fund on behalf of the Participant.
(b) SUBMISSION OF FORM. In order for Salary
Redirection to commence on the appropriate date
(the beginning of a payroll period), the Salary
Redirection agreement must be received by the
Committee, or effective June 1, 1998 the designee
of the Committee, at least fifteen (15) days prior
to the date Salary Redirection is to start.
Notwithstanding the above, a terminated
Participant who is reemployed and is eligible to
participate upon reemployment may enter into a
Salary Redirection Agreement on his reemployment
date to be applicable to Compensation earned on
and after such date. Effective June 1, 1998, a
Participant may elect to have Salary Redirection
made on his behalf commencing with the first day
of any payroll period which is at least fifteen
(15) days after the date of an election made in a
manner prescribed by the Committee. In the event a
Participant does not so elect when initially
eligible, he may subsequently elect to have Salary
Redirection made on his behalf commencing with the
first day of any payroll period which is at least
fifteen (15) days after the date his election in
the form prescribed by the Committee. The Salary
Redirection agreement shall be made in a manner
prescribed by the Committee. Such agreement shall
authorize the Employer to reduce Compensation
otherwise payable to the Participant during each
pay period by the amount of Salary Redirection
elected.
(c) CHANGE IN REDIRECTED AMOUNTS. A Participant
electing to have Salary Redirection made on his
behalf to the Plan pursuant to this Section, may,
on a Salary Redirection agreement provided by and
submitted to the Committee, increase or decrease
his Salary Redirection amount (within
the appropriate minimum and maximum) as of the
first day of any payroll period which is at least
fifteen (15) days after the date his election form
is received by the Committee, but not
retroactively. Effective June 1, 1998, a
Participant electing to have Salary Redirection
made on his behalf to the Plan pursuant to this
Section, may, in a manner prescribed by the
Committee enter into a Salary Redirection
agreement to increase or decrease his Salary
Redirection amount (within
48
the appropriate minimum and maximum) as of the
first day of any payroll period which is at least
(15) days after the date of such election, but not
retroactively. The Salary Redirection agreement
shall state the amount of Salary Redirection he
desires to have made.
(d) CESSATION OF REDIRECTION. Any Participant may
elect to cease future Salary Redirection to the
Plan effective with the first regular payroll
period that it is administratively possible to do
so following notification. In the event any such
Participant desires thereafter to recommence
having Salary Redirection made on his behalf, he
shall be allowed to do so effective with the first
day of any payroll period which is at least
fifteen (15) days after receipt of written notice
by the Committee on the appropriate form, or
effective June 1, 1998 in the manner prescribed by
the Committee stating the amount of Salary
Redirection he desires to have made.
(e) NOTICE REQUIREMENTS. Any of the notice
requirements in this Section may be lengthened or
shortened by the Committee if it finds it
administratively necessary or feasible to do so,
with such discretion being exercised in a
nondiscriminatory manner.
(f) PAYMENT TO TRUSTEE. The Employer shall pay to the
Trustee any Salary Redirection made on behalf of
any Participant within a reasonable time following
the end of each regular pay period as it can
reasonably be segregated from the Employer's
general assets, but no later than the fifteenth
(15th) business day of the month following the
month in which the Salary Redirection is received
by the Employer or the fifteenth (15th) business
day of the month following the month in which the
Salary Redirection would otherwise have been
payable to the Participant in cash.
(t) AMOUNTS OF ESOP DIVIDENDS DEEMED DEFERRED.
Effective January 1, 1998, a Participant will be
deemed to have elected to have a Salary
Redirection made on his behalf in the amount of
the ESOP Dividends paid to him in cash, subject to
the limits of Sections 401(k), 402(g) and 415 of
the Code and the regulations thereunder deemed
deferrals made pursuant to this Subsection 8.3(g),
shall not be taken into account in the calculation
of the percentage of salary redirected pursuant to
Subsection 8.3(a).
Section 8.4 MATCHING CONTRIBUTIONS
For each Accounting Year in which the Employer has
net profits or accumulated net profits, as
determined under generally accepted accounting
principles, the Employer shall make an Employer
Matching Contribution from such net profits or
accumulated net profits to the
49
Trust Fund on behalf of eligible Participants. The
Matching Contribution will be an amount necessary
to match one hundred percent (100%) of the
eligible Participants' net eligible Salary
Redirection made to the Trust Fund for the Plan
Year. Net eligible Salary Redirection means Salary
Redirection not to exceed four percent (4%)
percent of Compensation during the Plan Year,
which Salary Redirection has not been withdrawn.
For purposes of calculating net eligible Salary
Redirection, withdrawals shall be deemed to have
been made from the earliest Salary Redirection not
yet withdrawn. Any Matching Contribution which is
made as of a Valuation Date shall be allocated to
the Matching Contribution Account of each eligible
Participant. For purposes of this Section, an
eligible Participant shall mean a Participant who
has made Salary Redirection contributions during
the Plan Year.
Section 8.5 EMPLOYEE VOLUNTARY CONTRIBUTIONS
Each Participant employed by an Employer listed on
Appendix B may, but shall not be required to, make
after-tax Employee Voluntary Contributions to the
Plan by payroll deduction in an amount equal to an
integral percentage from one percent (1%) to
sixteen percent (16%) (or such lower percentage as
the Committee, in its discretion, may determine
for any Plan Year) of his Compensation for the
Plan Year. Notwithstanding the preceding sentence,
a Participant may not make Employee Voluntary
Contributions that would cause his total Employee
Voluntary Contributions and Salary Redirection
Contributions for the Plan Year to exceed sixteen
percent (16%) (or such other percentage as the
Committee, in its discretion, may establish for
any Plan Year) of his Compensation for the Plan
Year. The Committee may limit Employee Voluntary
Contributions at any time, if such limits are
necessary of advisable in order for the Plan to
comply with Section 3.5.
Section 8.6 SUBMISSION OF FORM
In order for Employee Voluntary Contributions to
commence on the appropriate date (the beginning of
a payroll period), the Employee Voluntary
Contributions agreement must be received by the
Committee, or effective June 1,1998 the designee
of the Committee, at least fifteen (15) days prior
to the date Employee Voluntary Contribution is to
start. Notwithstanding the above, a terminated
Participant who is reemployed and is eligible to
participate upon reemployment may enter into a
Employee Voluntary Contributions Agreement on his
reemployment date to be applicable to Compensation
earned on and after such date. In the event a
Participant does not so elect when initially
eligible, he may subsequently elect to have
Employee Voluntary Contributions made on his
behalf commencing with the first day of any
payroll period which is at least fifteen (15) days
50
after the date his election form is delivered to
the Committee. Effective June 1, 1998, a
Participant may elect to have Employee Voluntary
Contributions made on his behalf commencing with
the first day of any payroll period which is at
least fifteen (15) days after the date of an
election made in a manner prescribed by the
Committee. In the event a Participant does not so
elect when initially eligible, he may subsequently
elect to have Employee Voluntary Contributions
made on his behalf commencing with the first day
of any payroll period which is at least fifteen
(15) days after the date his election in the form
prescribed by the Committee. The Employee
Voluntary Contributions agreement shall be on a
form provided by the Committee. Such agreement
shall authorize the Employer to reduce the amount
otherwise payable to the Participant during each
pay period by the amount of the Employee Voluntary
Contribution elected.
(a) CHANGE IN EMPLOYEE VOLUNTARY CONTRIBUTION AMOUNTS.
A Participant electing to have Employee Voluntary
Contributions made on his behalf to the Plan
pursuant to this Section, may, on a Employee
Voluntary Contributions agreement provided by and
submitted to the Committee, increase or decrease
his Employee Voluntary Contributions amount
(within the appropriate minimum and maximum) as of
the first day of any payroll period which is at
least fifteen (15) days after the date his
election form is received by the Committee, but
not retroactively. Effective June 1, 1998 a
Participant electing to have Employee Voluntary
Contributions made on his behalf to the Plan
pursuant to this Section, may, in a manner
prescribed by the Committee, enter into a Employee
Voluntary Contributions agreement to increase or
decrease his Employee Voluntary Contributions
amount (within the appropriate minimum and
maximum) as of the first day of any payroll period
which is at least fifteen (15) days after the date
of such election, but not retroactively. The
Employee Voluntary Contributions agreement shall
state the amount of Employee Voluntary
Contributions he desires to have made.
(b) CESSATION OF REDIRECTION. Any Participant may
elect to cease future Employee Voluntary
Contributions to the Plan effective with the first
regular payroll period that it is administratively
possible to do so following notification. In the
event any such Participant desires thereafter to
recommence having Employee Voluntary Contributions
made on his behalf, he shall be allowed to do so
effective with the first day of any payroll period
which is at least fifteen (15) days after receipt
of written notice by the Committee on the
appropriate form, or effective June 1, 1998 in the
manner prescribed by the Committee, stating the
amount of Employee Voluntary Contributions he
desires to have made.
(c) NOTICE REQUIREMENTS. Any of the notice
requirements in this Section
51
may be lengthened or shortened by the Committee if
it finds it administratively necessary or feasible
to do so, with such discretion being exercised in
a nondiscriminatory manner.
(d) PAYMENT TO TRUSTEE. The Employer shall pay to the
Trustee any Employee Voluntary Contributions made
on behalf of any Participant within a reasonable
time following the end of each regular pay period
as it can reasonably be segregated from the
Employer's general assets, but no later than the
fifteenth (15th) business day of the month
following the month in which the Employee
Voluntary Contribution is received by the Employer
or the fifteenth (15th) business day of the month
following the month in which the Employee
Voluntary Contribution would otherwise have been
payable to the Participant in cash.
Section 8.7 VESTING
That portion of the Indiv8idual Account
established pursuant to Section 8.2 and Section
8.4, shall vest in accordance with the following
schedule:
Years of Service Vested Percentage
Less than 1 year 0%
1 year but less than 2 20%
2 years but less than 3 40%
3 years but less than 4 60%
4 years but less than 5 80%
5 years or more 100%
Notwithstanding the foregoing, the portion of the
Individual Account established pursuant to Section
10.1, which is attributable to Employer Matching
Contributions for Participants in the Prior LNI
Plan hired prior to May 15, 1995 shall be one
hundred percent (100%) vested in their Individual
Account. Furthermore, the portion of the
Individual Account established pursuant to Section
10.1, which is attributable to Employer Matching
Contributions for Participants in the Prior LNI
Plan made prior to January 1, 1998 shall be one
hundred percent (100%) vested in their Individual
Account.
Section 8.8 FORFEITURES
(a) A Participant who terminates employment
pursuant to this Article with a zero (0)
vested percentage shall be deemed to have
received a distribution on the date he
terminates employment. If a terminated
Participant receives a distribution of the
vested portion of his Individual Account
prior to incurring five (5) Breaks in
52
Service or if the terminated Participant is
zero percent (0%) vested in his Individual
Account, the non-vested balance of such
terminated Participant's Individual Account
shall be forfeited as of the date he
receives or is deemed to receive said
distribution. If the Participant does not
repay the distributed amount, upon a
subsequent termination of employment prior
to the Participant's becoming one hundred
percent (100%) vested, the gross
distribution shall be determined by
multiplying the vested percentage at the
subsequent termination by the amount of the
account balance as of the date of
distribution plus the distribution
previously received. The amount to be
distributed to the Participant shall be the
gross distribution minus the amount
previously distributed.
(b) If a terminated Participant is reemployed
and again becomes a Participant prior to
incurring five (5) consecutive Breaks in
Service, any amount forfeited pursuant to
this Section will be restored to his
Individual Account if he repays, prior to
the earlier of the last day of the Plan
Year in which he incurs his fifth (5th)
consecutive Break in Service commencing on
the date of the distribution or the date
which is five (5) years after the date on
which the Participant is reemployed, the
amount previously distributed to him from
such Account. Restoration of a forfeiture
will come from forfeitures in the year in
which he is reemployed and, to the extent
such forfeitures are not sufficient, from a
special Employer Contribution. For purposes
of this Subsection, a Participant who is
deemed to have received a distribution
pursuant to this Section will be deemed to
have repaid the distribution upon
reemployment.
(c) The non-vested balance of the Individual
Account of a terminated Participant shall be
forfeited as of the December 31 Valuation
Date following the Participant's incurring
five (5) consecutive Breaks in Service if
the Participant is vested in any portion of
his Individual Account and does not receive
a distribution prior to incurring five (5)
consecutive Breaks in Service.
(d) Any amount forfeited as a Matching
Contribution or Profit Sharing Contribution
will be reallocated as a Matching
Contribution or a Profit Sharing
Contribution respectively.
53
ARTICLE 9
PROVISIONS RELATING TO PRIOR LPI PLAN PARTICIPANTS
Section 9.1 PRIOR LPI PLAN BALANCES
Effective January 1, 1998, individual account
balances of the Prior LPI Plan shall be transferred
to the Plan, and shall become part of the
Participant's Individual Account under the Plan.
Section 9.2 SERVICE
Notwithstanding the definition of Year of Service in
Section 1.67, Service for any Employee who was
employed by an Employer participating in the Prior
LPI Plan, prior to becoming a Participant in the Plan
shall be defined to include the aggregate of the
employment period with the Employer.
Section 9.3 VESTING
That portion of the Individual Account established
pursuant to Section 9.1, which is attributable to
Employer Matching and Mandatory Employer
Contributions shall continue to vest in accordance
with the following schedule:
Years of Service Vested Percentage
Less than 1 year 0%
1 year but less than 2 20%
2 years but less than 3 40%
3 years but less than 4 60%
4 years but less than 5 80%
5 years or more 100%
Section 9.4 FORFEITURES
(a) A Participant who terminates employment
pursuant to this Article with a zero (0)
vested percentage shall be deemed to have
received a distribution on the date he
terminates employment. If a terminated
Participant receives a distribution of the
vested portion of his Individual Account
prior to incurring five (5) Breaks in
Service or if the terminated Participant is
zero percent (0%) vested in his Individual
Account, the non-vested balance of such
terminated Participant's Individual Account
shall be forfeited as of the date he
receives or is deemed to receive said
distribution. If the Participant does not
repay the distributed amount, upon a
subsequent termination of employment prior
to the Participant's
54
becoming one hundred percent (100%) vested,
the gross distribution shall be determined
by multiplying the vested percentage at the
subsequent termination by the amount of the
account balance as of the date of
distribution plus the distribution
previously received. The amount to be
distributed to the Participant shall be the
gross distribution minus the amount
previously distributed.
(b) If a terminated Participant is reemployed
and again becomes a Participant prior to
incurring five (5) consecutive Breaks in
Service, any amount forfeited pursuant to
this Section will be restored to his
Individual Account if he repays, prior to
the earlier of the last day of the Plan
Year in which he incurs his fifth (5th)
consecutive Break in Service commencing on
the date of the distribution or the date
which is five (5) years after the date on
which the Participant is reemployed, the
amount previously distributed to him from
such Account. Restoration of a forfeiture
will come from forfeitures in the year in
which he is reemployed and, to the extent
such forfeitures are not sufficient, from a
special Employer Contribution. For purposes
of this Subsection, a Participant who is
deemed to have received a distribution
pursuant to this Section will be deemed to
have repaid the distribution upon
reemployment.
(c) The non-vested balance of the Individual
Account of a terminated Participant shall be
forfeited as of the December 31 Valuation
Date following the Participant's incurring
five (5) consecutive Breaks in Service if
the Participant is vested in any portion of
his Individual Account and does not receive
a distribution prior to incurring five (5)
consecutive Breaks in Service.
(d) Any amount forfeited as a Matching
Contribution or Profit Sharing Contribution
will be reallocated as a Matching
Contribution or a Profit Sharing
Contribution respectively.
55
ARTICLE 10
PROVISIONS RELATING TO PRIOR LNI PLAN PARTICIPANTS
Section 10.1 PRIOR LNI PLAN BALANCES
Effective January 1, 1998, individual account
balances of the Prior LNI Plan shall be
transferred to the Plan, and shall become part of
the Participant's Individual Account under the
Plan ("Prior LNI Balance").
Section 10.2 SERVICE
Notwithstanding the definition of Service in
Section 1.67, Service for any Employee who was
employed by an Employer participating in the Prior
LNI Plan, prior to becoming a Participant in the
Plan shall be defined to include the aggregate of
the employment period with the Employer.
Section 10.3 VESTING
That portion of the Individual Account established
pursuant to Section 10.1, which is attributable to
Employer Matching Contributions and Mandatory
Employer Contributions shall continue to vest in
accordance with the following schedule:
Years of Service Vested Percentage
Less than 1 year 0%
1 year but less than 2 25%
2 years but less than 3 50%
3 years but less than 4 75%
4 years or more 100%
Notwithstanding the foregoing, the portion of the
Individual Account established pursuant to Section
10.1, which is attributable to Employer Matching
Contributions for Participants in the Prior LNI
Plan during the 1997 Plan Year, shall be one
hundred percent (100%) vested in said portion of
their Individual Account.
Section 10.4 FORFEITURES
(a) A Participant who terminates employment pursuant
to this Article with a zero (0) vested percentage
shall be deemed to have received a distribution on
the date he terminates employment. If a terminated
Participant receives a distribution of the vested
portion of his Individual Account prior to
incurring five (5) Breaks in
56
Service or if the terminated Participant is zero
percent (0%) vested in his Individual Account, the
non-vested balance of such terminated
Participant's Individual Account shall be
forfeited as of the date he receives or is deemed
to receive said distribution. If the Participant
does not repay the distributed amount, upon a
subsequent termination of employment prior to the
Participant's becoming one hundred percent (100%)
vested, the gross distribution shall be determined
by multiplying the vested percentage at the
subsequent termination by the amount of the
account balance as of the date of distribution
plus the distribution previously received. The
amount to be distributed to the Participant shall
be the gross distribution minus the amount
previously distributed.
(b) If a terminated Participant is reemployed and
again becomes a Participant prior to incurring
five (5) consecutive Breaks in Service, any amount
forfeited pursuant to this Section will be
restored to his Individual Account if he repays,
prior to the earlier of the last day of the Plan
Year in which he incurs his fifth (5th)
consecutive Break in Service commencing on the
date of the distribution or the date which is five
(5) years after the date on which the Participant
is reemployed, the amount previously distributed
to him from such Account. Restoration of a
forfeiture will come from forfeitures in the year
in which he is reemployed and, to the extent such
forfeitures are not sufficient, from a special
Employer Contribution. For purposes of this
Subsection, a Participant who is deemed to have
received a distribution pursuant to this Section
will be deemed to have repaid the distribution
upon reemployment.
(c) The non-vested balance of the Individual Account
of a terminated Participant shall be forfeited as
of the December 31 Valuation Date following the
Participant's incurring five (5) consecutive
Breaks in Service if the Participant is vested in
any portion of his Individual Account and does not
receive a distribution prior to incurring five (5)
consecutive Breaks in Service.
(d) Any amount forfeited as a Matching Contribution or
Profit Sharing Contribution will be reallocated as
a Matching Contribution or a Profit Sharing
Contribution respectively.
Section 10.5 DISTRIBUTIONS
Notwithstanding anything in the Plan to the
contrary, Participants described in Section 10.1
with a portion of their Individual Account that is
attributable to their Prior LNI Balance shall
receive distribution of said
57
amounts in the manner prescribed below.
(a) DISTRIBUTIONS IN THE FORM OF AN ANNUITY. That
vested portion of a Participant's Individual
Account attributable to the Prior LNI Balance
shall be paid in the form of a Qualified Joint and
Survivor Annuity. The Participant may elect to
have such annuity distributed upon attainment of
Early Retirement. If a Participant dies before the
Annuity Starting Date, the Participant's vested
Prior LNI Balance shall be applied toward the
purchase of a Qualified Preretirement Survivor
Annuity. The Surviving Spouse may elect to have
such annuity distributed within a reasonable time
period after the Participant's death. All
annuities distributed under the Plan which begin
prior to a Participant's Required Beginning Date
shall provide that the amount of the distributions
for the calendar year preceding the calendar year
which contains the Required Beginning Date comply
with the minimum distribution requirements of
Section 401(a)(9) of the Code.
(b) A Participant may avoid receiving a distribution
in the form of a Qualified Joint and Survivor
Annuity by making a qualified election in which an
optional method of distribution that is described
in Section 5.9 is selected. Such qualified
election must be made within the ninety (90) day
period ending on the Annuity Starting Date. A
Participant may avoid a distribution if the form
of a Qualified Preretirement Survivor Annuity by
making a qualified election in which an optional
method of distribution that is described in
Section 5.9 is selected. Such qualified election
must be made during the period in which the
Participant attains age thirty-five (35) or the
date the Participant terminates his employment
with the Employer, and ending on the date of
death.
58
ARTICLE 11
FUNDING
Section 11.1 CONTRIBUTIONS
Contributions by the Employer and by the
Participants as provided for in Article 3 and
Article 8 shall be paid over to the Trustee. All
contributions by the Employer shall be
irrevocable, except as herein provided, and may be
used only for the exclusive benefit of the
Participants, Former Participants and their
Beneficiaries.
Section 11.2 TRUSTEE
The Sponsoring Employer has entered into an
agreement with the Trustee whereunder the Trustee
will receive, invest and administer as a trust
fund contributions made under this Plan in
accordance with the Trust Agreement.
Such Trust Agreement is incorporated by reference
as a part of the Plan, and the rights of all
persons hereunder are subject to the terms of the
Trust Agreement. The Trust Agreement specifically
provides, among other things, for the investment
and reinvestment of the Fund and the income
thereof, the management of the Trust Fund, the
responsibilities and immunities of the Trustee,
removal of the Trustee and appointment of a
successor, accounting by the Trustee and the
disbursement of the Trust Fund.
The Trustee shall, in accordance with the terms of
such Trust Agreement, accept and receive all sums
of money paid to it from time to time by the
Employer, and shall hold, invest, reinvest, manage
and administer such moneys and the increment,
increase, earnings and income thereof as a trust
fund for the exclusive benefit of the
Participants, Former Participants and their
Beneficiaries or the payment of reasonable
expenses of administering the Plan.
In the event that affiliated or subsidiary
Employers become signatory hereto, completely
independent records, allocations, and
contributions shall be maintained for each
Employer. The Trustee may invest all funds without
segregating assets between or among signatory
Employers.
59
ARTICLE 12
FIDUCIARIES
Section 12.1 GENERAL
Each Fiduciary who is allocated specific duties or
responsibilities under the Plan or any Fiduciary
who assumes such a position with the Plan shall
discharge his duties solely in the interest of the
Participants, Former Participants and
Beneficiaries and for the exclusive purpose of
providing such benefits as stipulated herein to
such Participants, Former Participants and
Beneficiaries, or defraying reasonable expenses of
administering the Plan. Each Fiduciary, in
carrying out such duties and responsibilities,
shall act with the care, skill, prudence, and
diligence under the circumstances then prevailing
that a prudent person acting in a like capacity
and familiar with such matters would use in
exercising such authority or duties.
A Fiduciary may serve in more than one Fiduciary
capacity and may employ one or more persons to
render advice with regard to his Fiduciary
responsibilities. If the Fiduciary is serving as
such without compensation, all expenses reasonably
incurred by such Fiduciary shall be paid from the
Trust Fund or by the Employer.
A Fiduciary may delegate any of his
responsibilities for the operation and
administration of the Plan. In limitation of this
right, a Fiduciary may not delegate any
responsibilities as contained herein relating to
the management or control of the Trust Fund except
through the employment of an investment manager as
provided in Section 12.3 and in the Trust
Agreement relating to the Fund.
Section 12.2 EMPLOYER
The Sponsoring Employer established and maintains
the Plan for the benefit of its Employees and for
Employees of Participating Employers and of
necessity retains control of the operation and
administration of the Plan. The Sponsoring
Employer, in accordance with specific provisions
of the Plan, has as herein indicated, delegated
certain of these rights and obligations to the
Trustee, and the Committee and these parties shall
be solely responsible for these, and only these,
delegated rights and obligations.
The Employer shall supply such full and timely
information for all matters relating to the Plan
as (a) the Committee, (b) the Trustee, and (c) the
accountant engaged on behalf of the Plan by the
Sponsoring
60
Employer may require for the effective discharge
of their respective duties.
Section 12.3 TRUSTEE
The Trustee, in accordance with the Trust
Agreement, shall have exclusive authority and
discretion to manage and control the Trust Fund,
except that the Sponsoring Employer may in its
discretion employ at any time and from time to
time an Investment Manager to direct the Trustee
with respect to all or a designated portion of the
assets comprising the Trust Fund.
Section 12.4 BENEFITS COMMITTEE
(a) The Board of the Sponsoring Employer shall appoint
a Committee of not less than three (3) persons to
hold office at the pleasure of the Board of
Directors, such committee to be known as the
401(k) Savings Committee, effective June 5, 1996,
the Benefits Committee, collectively, the
Committee. No compensation shall be paid members
of the Committee from the Trust Fund for service
on such Committee. The Committee shall choose from
among its members a chairperson and a secretary.
Any action of the Committee shall be determined by
the vote of a majority of its members. Either the
chair or the secretary may execute any certificate
or written direction on behalf of the Committee.
(b) Every decision and action of the Committee shall
be valid if concurrence is by a majority of the
members then in office, which concurrence may be
had without a formal meeting.
(c) In accordance with the provisions hereof, the
Committee has been delegated certain
administrative functions relating to the Plan with
all powers necessary to enable it to properly
carry out such duties. Except as provided in
Section 13.1, the Committee shall have no power in
any way to modify, alter, add to, or subtract
from, any provisions of the Plan; provided,
however, that the Committee is authorized, acting
by a majority of its members then in office, to
make certain technical and non-material changes in
the Plan. The Committee shall have the power and
authority in its sole, absolute and uncontrolled
discretion to control and manage the operation and
administration of the Plan and shall have all
powers necessary to accomplish these purposes. The
responsibility and authority of the Committee
shall include, but shall not be limited to, (i)
determining all questions relating to eligibility
of employees to participate; (ii) determining the
amount and kind of benefit payable to any
Participant, spouse or Beneficiary; (iii)
establishing and reducing to writing and
distributing to any Participant or Beneficiary a
claims procedure and administering that procedure,
including the processing
61
and determination of all appeals thereunder; (iv)
interpreting the provisions of the Plan including
the publication of rules for the regulation of the
Plan as in its sole, absolute and uncontrolled
discretion are deemed necessary or advisable and
which are not inconsistent with the express terms
hereof, the Code or the Employee Retirement Income
Security Act of 1974, as amended, and (v)
execution of amendments in accordance with Section
13.1. All disbursements by the Trustee, except for
the ordinary expenses of administration of the
Trust Fund or the reimbursement of reasonable
expenses at the direction of the Sponsoring
Employer, as provided herein, shall be made upon,
and in accordance with, the written directions of
the Committee. When the Committee is required in
the performance of its duties hereunder to
administer or construe, or to reach a
determination, under any of the provisions of the
Plan, it shall do so on a uniform, equitable and
nondiscriminatory basis.
(d) The Committee may employ such counsel,
accountants, and other agents as it shall deem
advisable. The Sponsoring Employer shall pay, or
cause to be paid from the Trust Fund, the
compensation of such counsel, accountants, and
other agents and any other expenses incurred by
the Committee in the administration of the Plan
and Trust.
Section 12.5 CLAIMS PROCEDURES
(a) The Committee shall receive all applications for
benefits. Upon receipt by the Committee of such an
application, it shall determine all facts which
are necessary to establish the right of an
applicant to benefits under the provisions of the
Plan and the amount thereof as herein provided.
Upon request, the Committee will afford the
applicant the right of a hearing with respect to
any finding of fact or determination. The
applicant shall be notified in writing of any
adverse decision with respect to his claim within
ninety (90) days after its submission. The notice
shall be written in a manner calculated to be
understood by the applicant and shall include the
items specified in items (1) through (4) of this
Subsection.
(1) The specific reason or reasons for the
denial;
(2) Specific references to the pertinent Plan
provisions on which the denial is based;
(3) A description of any additional material or
information necessary for the applicant to
perfect the claim and an explanation why
such material or information is necessary;
and
(4) An explanation of the Plan's claim review
procedures.
62
(b) If special circumstances require an extension of
time for processing the initial claim, a written
notice of the extension and the reason therefor
shall be furnished to the claimant before the end
of the initial ninety (90) day period. In no event
shall such extension exceed ninety (90) days.
(c) In the event a claim for benefits is denied or if
the applicant has had no response to such claim
within ninety (90) days of its submission (in
which case the claim for benefits shall be deemed
to have been denied), the applicant or his duly
authorized representative, at the applicant's sole
expense, may appeal the denial to the Committee
within sixty (60) days of the receipt of written
notice of denial or sixty (60) days from the date
such claim is deemed to be denied. In pursuing
such appeal the applicant or his duly authorized
representative:
(1) May request in writing that the Committee
review the denial;
(2) May review pertinent documents; and
(3) May submit issues and comments in writing.
(d) The decision on review shall be made within sixty
(60) days of receipt of the request for review,
unless special circumstances require an extension
of time for processing, in which case a decision
shall be rendered as soon as possible, but not
later than one hundred twenty (120) days after
receipt of a request for review. If such an
extension of time is required, written notice of
the extension shall be furnished to the claimant
before the end of the original sixty (60) day
period. The decision on review shall be made in
writing, shall be written in a manner calculated
to be understood by the claimant, and shall
include specific references to the provisions of
the Plan on which such denial is based. If the
decision on review is not furnished within the
time specified above, the claim shall be deemed
denied on review.
Section 12.6 RECORDS
All acts and determinations of the Committee shall
be duly recorded by the secretary thereof and all
such records together with such other documents as
may be necessary in exercising his duties under
the Plan shall be preserved in the custody of such
secretary. Such records and documents shall at all
times be open for inspection and for the purpose
of making copies by any person designated by the
Sponsoring Employer. The Committee shall provide
such timely information, resulting from the
application of its responsibilities under the
Plan, as needed by the Trustee and the accountant
engaged on behalf of the Plan
63
by the Sponsoring Employer, for the effective
discharge of their respective duties.
64
ARTICLE 13
AMENDMENT AND TERMINATION OF THE PLAN
Section 13.1 AMENDMENT OF THE PLAN
The Sponsoring Employer shall have the right at
any time by action of the Board to modify, alter
or amend the Plan, in whole or in part; effective
September 1, 1994 the Committee in the case of
non-material amendments, provided, however, that
the duties, powers and liability of the Trustee
hereunder shall not be increased without its
written consent; and provided, further, that the
amount of benefits which, at the time of such
modification, alteration or amendment, shall have
accrued for any Participant, Former Participant or
Beneficiary hereunder shall not be adversely
affected thereby; and provided, further, that no
such amendment shall have the effect of reverting
to any Employer any part of the principal or
income of the Trust Fund. No amendment to the Plan
shall decrease the balance of a Participant's
Individual Account or eliminate an optional form
of distribution.
Section 13.2 TERMINATION OF THE PLAN
The Sponsoring Employer expects to continue the
Plan indefinitely, but continuance is not assumed
as a contractual obligation and the Sponsoring
Employer reserves the right at any time by action
of the Board to terminate its participation in the
Plan. If the Sponsoring Employer terminates or
partially terminates its participation in the Plan
or permanently discontinues its Contributions at
any time, each Participant affected thereby shall
be then vested with the amount to the credit in
his Individual Account.
In the event of termination or partial termination
of the Plan by the Sponsoring Employer, the
Committee shall value the Trust Fund as of the
date of termination. That portion of the Trust
Fund for which the Plan has not been terminated
shall be unaffected.
Section 13.3 RETURN OF CONTRIBUTIONS
It is intended that this Plan shall be approved and
qualified under the Code and Regulations issued
thereunder with respect to Employees' Plans and
Trusts (1) so as to permit the Employers to deduct
for federal income tax purposes the amounts of
contributions to the Trust; (2) so that
contributions so made and the income of the Trust
Fund will not be taxable to Participants as income
until received; (3) so that the income of the
Trust Fund shall be exempt from federal income
tax. Any
65
Employer Contributions and Salary Redirection are
made to the Plan conditioned on their
deductibility under Code Section 404. In the event
the Commissioner of Internal Revenue or his
delegate rules that the deduction for all or a
part of any Employer Contribution (or Salary
Redirection) is not allowed under Code Section
404, the Employers reserve the right to recover
that portion or all of their contributions for
which no deduction is allowed (reduced by any
losses), provided such recovery is made within one
(1) year of the disallowance, but only if the
application for the qualification is made by the
time prescribed by law for filing the Employer's
return for the taxable year in which the Plan is
adopted, or such later date as the Secretary of
the Treasury may prescribe.
66
ARTICLE 14
MISCELLANEOUS
Section 14.1 GOVERNING LAW
The Plan shall be construed, regulated and
administered according to the laws of the
Commonwealth of Kentucky, except in those areas
preempted by the laws of the United States of
America.
Section 14.2 CONSTRUCTION
The headings and subheadings in the Plan have been
inserted for convenience of reference only and
shall not affect the construction of the
provisions hereof. The words and phrases defined
in Article 1 when used in this Plan with an
initial capital letter shall have the meanings
specified in Article 1, unless a different meaning
is clearly required by the context. Any words
herein used in the masculine shall be read and
construed in the feminine where they would so
apply. Words in the singular shall be read and
construed as though used in the plural in all
cases where they would so apply.
Section 14.3 ADMINISTRATION EXPENSES
The expenses of administering the Trust Fund and
the Plan shall be paid from the Trust Fund, unless
they are paid by the Employer.
Section 14.4 PARTICIPANT'S RIGHTS
No Participant in the Plan shall acquire any right
to be retained in the Employer's employ by virtue
of the Plan, nor, upon his dismissal, or upon his
voluntary termination of employment, shall he have
any right or interest in and to the Trust Fund
other than as specifically provided herein. The
Employer shall not be liable for the payment of
any benefit provided for herein; all benefits
hereunder shall be payable only from the Trust
Fund.
Section 14.5 SPENDTHRIFT CLAUSE
To the extent permitted by law, none of the
benefits, payments, proceeds, or distributions
under this Plan shall be subject to the claim of
any creditor of the Participant, Former
Participant or any Beneficiary hereunder or to any
legal process by any creditor of such Participant,
Former Participant or any such Beneficiary; and
neither shall such Participant, Former Participant
or any such Beneficiary have any right
67
to alienate, commute, anticipate, or assign any of
the benefits, payments, proceeds or distributions
under this Plan. The preceding sentence shall also
apply to the creation, assignment, or recognition
of a right to any benefit payable with respect to
a Participant pursuant to a domestic relations
order, unless such order is determined to be a
qualified domestic relations order, as defined in
Section 414(p) of the Code, or any domestic
relations order entered before January 1, 1985,
under which payments have commenced prior to such
date.
This Plan specifically permits a distribution to
an alternate payee under a qualified domestic
relations order at any time, irrespective of
whether the Participant has attained his earliest
retirement age under the Plan. Nothing in Section
5.9 gives a Participant a right to receive a
distribution at a time otherwise not permitted
under the Plan nor does it permit the alternate
payee to receive a form of payment not permitted
under the Plan.
Section 14.6 MERGER, CONSOLIDATION OR TRANSFER
In the event of the merger or consolidation of the
Plan with another plan or transfer of assets or
liabilities from the Plan to another plan, each
then Participant, Former Participant or
Beneficiary shall not, as a result of such event,
be entitled on the day following such merger,
consolidation or transfer under the termination of
the Plan provisions to a lesser benefit than the
benefit he was entitled to on the date prior to
the merger, consolidation or transfer if the Plan
had then terminated.
Section 14.7 COUNTERPARTS
The Plan and the Trust Agreement may be executed
in any number of counterparts, each of which shall
constitute but one and the same instrument and may
be sufficiently evidenced by any one counterpart.
68
ARTICLE 15
TOP HEAVY PLAN PROVISIONS
Section 15.1 GENERAL
Notwithstanding anything in the Plan to the
contrary, if this Plan when combined with all
other plans required to be aggregated pursuant to
Code Section 416(g) is deemed to be a top-heavy
plan for any Plan Year, the Subsections in this
Article shall apply to such Plan Year.
Section 15.2 MINIMUM CONTRIBUTION
Regardless of hours worked or level of
compensation, each active Participant who is not a
Key Employee shall be entitled to a minimum
allocation of contributions and forfeitures equal
to the lesser of (i) three percent (3%) of the
Participant's Compensation for the Plan Year; and
(ii) provided that the Plan is not part of a
Required Aggregation Group with a Defined Benefit
Plan because the Plan enables the Defined Benefit
Plan to meet the requirements of Code Section
401(a)(4) or 410, the highest percentage of
Compensation contributed on behalf of, plus
forfeitures allocated to, a Key Employee
[(including Salary Redirection)]. In the case of a
Participant who is also a participant in a defined
benefit plan maintained by the Employer, the
minimum accrued benefit provided in the defined
benefit plan pursuant to Code Section 416(c)(1)
equal to two percent (2%) of the Participant's
average monthly compensation for the five (5)
consecutive years when his aggregate compensation
was highest multiplied by his years of credited
service up to ten (10) years for each Plan Year in
which the Plan is top heavy, shall be the only
minimum benefit for both that plan and this Plan,
and the minimum allocation described above shall
not apply.
Section 15.3 SUPER TOP HEAVY PLANS
The multiplier of one and twenty-five hundredths
(1.25) in Section 4.7 shall be reduced to one
(1.0) unless (i) all plans of the Required
Aggregation Group or the Permissive Aggregation
Group, when aggregated are ninety percent (90%) or
less top heavy, and (ii) the minimum accrued
benefit referenced in Section 11.2 is modified by
substituting three percent (3%) with four percent
(4%). In the case of each Participant who is also
a participant in a defined benefit plan maintained
by the Employer, the minimum accrued benefit
provided in the defined benefit plan pursuant to
Code Sections 416(c)(1) and 416(h) equal to three
percent (3%) of the Participant's average monthly
compensation for the five (5) highest consecutive
years when his
69
aggregate compensation was highest multiplied by
his years of credited service up to ten (10) years
for each Plan Year in which the Plan is top heavy
shall be the only minimum benefit for both that
plan and this Plan, and the minimum allocation
described above shall not apply.
70
ARTICLE 16
PROVISIONS CONCERNING CERTAIN CHANGES IN EMPLOYMENT
Section 16.1 TRANSFER TO NON-PARTICIPATING EMPLOYER
A Participant who becomes employed by another
employer which is a subsidiary or affiliate of the
Company, although not an Employer hereunder, shall
cease to be covered by the Plan as of the date of
his change in employer. Effective as of such date,
he shall become a Limited Participant in the Plan
and Article 5 shall not be applicable. As a
Limited Participant, he shall be entitled to share
in Matching Contributions in accordance with
Section 3.2 or Section 8.4 to the extent of Salary
Redirection made prior to becoming a Limited
Participant. A Limited Participant shall also be
entitled to request a withdrawal and a loan as
provided in Article 6. During the period he is a
Limited Participant, his Individual Account shall
continue to share in Adjustments as provided in
Article 4. If the Limited Participant terminates
employment with the Company without returning to
active Participant status, he shall be entitled to
the full value of his Individual Account as of the
date of distribution.
If a Limited Participant again transfers
employment to an Employer as defined herein, he
shall be eligible to have Salary Redirection made
on his behalf in accordance with the Plan as of
the date he becomes an Employee. If the Limited
Participant does not resume having Salary
Redirection made on his behalf immediately upon
becoming an Employee, the terms of the Plan shall
continue to apply to any subsequent election to
have Salary Redirection begin.
Section 16.2 TRANSFER TO ANOTHER PARTICIPATING EMPLOYER
A Participant who transfers his employment to
another Employer without breaking his continuous
service shall continue to be covered by the Plan
without interruption, provided he enters into a
Salary Redirection agreement with his new
Employer. If the Participant enters into such a
Salary Redirection agreement, a separate
Individual Account shall be established for him to
reflect his Plan participation with that Employer.
Section 16.3 TRANSFER FROM NON-PARTICIPATING EMPLOYER
An employee who transfers employment from an
employer which is a subsidiary or affiliate of the
Company, but which is not itself signatory
71
hereto, to an Employer hereunder shall, for
purposes of determining eligibility to
participate, have his period of employment with
the non-participating employer recognized. The
Employee shall be eligible to participate in
accordance with Article 2.
Section 16.4 CHANGE IN EMPLOYMENT CLASSIFICATION
If an employee of the Company becomes an Employee,
as defined herein, due to a change in employment
classification, he shall be eligible to
participate in accordance with the terms of
Article 2. If an Employee ceases to be an Employee
due to a change in employment classification, he
shall cease to be eligible to participate
effective as of the date of such change.
If a Participant is simultaneously employed by
more than one signatory Employer within the
Company, an Individual Account shall be maintained
for him by each Employer to reflect his
Compensation from each such Employer.
Notwithstanding the terms of the preceding
sentence, the limits on deferrals and Compensation
shall be applied in total to the Participant and
his Individual Accounts will be aggregated for
purposes of testing Plan contributions and
deferral percentages.
72
ARTICLE 17
PROVISIONS RELATING TO PRIOR KENTUCKY UTILITIES
COMPANY EMPLOYEE SAVINGS PLAN PARTICIPANTS
Section 17.1 PARTICIPATION OF FORMER EMPLOYEES
Effective May 4, 1998, each Employee who was employed
by KU Energy Corp. or its subsidiaries, and who was a
participant in the Kentucky Utilities Company
Employee Savings Plan immediately prior to becoming
an Employee, shall be eligible to participate in the
Plan upon the date he becomes an Employee if the
Employee elects to participate in the Plan upon his
first date of employment. If the Employee so situated
declines participation on this first date of
employment, he may thereafter elect to participate as
of the next Entry Date, which is administratively
feasible in accordance with Section 2.1 of the Plan.
If an Employee was not eligible to participate in the
Kentucky Utilities Company Employee Savings Plan
immediately prior to becoming an Employee, the
provisions of Section 2.1 shall apply.
Section 17.2 SERVICE
Notwithstanding the definition of Service, Service
for any Employee who was employed by KU Energy Corp.
or its subsidiaries, immediately prior to becoming a
Participant in the Plan shall be defined to include
the aggregate of the employment period with the
Employer and the employment period with such prior
employer.
Section 17.3 MERGER OF PRIOR PLAN BALANCES
Effective August 1, 1998 the Kentucky Utilities
Company Employee Stock Ownership Plan and the
Kentucky Utilities Company Employee Savings Plan
(collectively "Prior KU Plans") were merged into the
Plan, and the Individual Accounts were credited with
the amounts transferred by the trustees of the Prior
KU Plans. An Employee who was a participant in the
Kentucky Utilities Company Employee Savings Plan
immediately prior to the merger of the Prior KU
Plans, shall be eligible to participate in the Plan
upon the date of the merger of the Prior KU Plans
into the Plan. If the Employee so situated declines
participation on the date of the merger of the Prior
KU Plans into the Plan he may thereafter elect to
participate as of the next Entry Date, which is
administratively feasible in accordance with Section
2.1 of the Plan. If an Employee was not eligible to
participate in the Kentucky Utilities Company
Employee Savings Plan immediately prior to the date
of the merger of the Prior KU Plans into the Plan,
the provisions of Section 2.1 shall apply.
73
ARTICLE 18
PROVISIONS RELATING TO WKE CORP. EMPLOYEES
Section 18.1 PARTICIPATION OF FORMER EMPLOYEES
Effective July 17,1998, each Employee who was
employed by Big Rivers Electric Corporation, and who
was a participant in a savings plan sponsored by Big
Rivers Electric Corporation immediately prior to
becoming an Employee, shall be eligible to
participate in the Plan upon the date he becomes an
Employee if the Employee elects to participate in the
Plan upon his first date of employment. If the
Employee so situated declines participation on this
first date of employment, he may thereafter elect to
participate as of the next Entry Date, which is
administratively feasible in accordance with Section
2.1 of the Plan. If an Employee was not eligible to
participate in a Big Rivers Electric Corporation plan
immediately prior to becoming an Employee, the
provisions of Section 2.1 shall apply.
Section 18.2 SERVICE
Notwithstanding the definition of Service, Service
for any Employee who was employed by Big Rivers
Electric Corporation, immediately prior to becoming a
Participant in the Plan shall be defined to include
the aggregate of the employment period with the
Employer and the employment period with such prior
employer.
74
*********************
SIGNATURES
IN WITNESS WHEREOF, the Corporation has caused this Plan to be executed
this ____ day of __________________, 1999, effective as of the dates set forth
above.
Witness: By _________________________
______________________ Title ________________________
75
Appendix A
PARTICIPATING EMPLOYERS
LG&E Energy Corp.
Louisville Gas and Electric Company
LG&E Home Services Inc., effective February 1, 1996
Enertech Inc., effective February 1, 1996
WKE Corp., WKE Station Two Inc., Western Kentucky Energy, Corp.,
effective July 17, 1998
Kentucky Utilities Company, effective August 1, 1998
76
APPENDIX B
PARTICIPATING EMPLOYERS
LG&E Power Inc., effective January 1, 1998.
LG&E Natural Inc., effective January 1, 1998.
LG&E Natural Marketing Inc., effective January 1, 1998.
Hadson Financial Corporation, effective January 1, 1998.
77
LG & E ENERGY CORP. SAVINGS PLAN
INSTRUMENT OF AMENDMENT
WHEREAS, LG&E Energy Corp. (the "Sponsor") previously adopted and maintains
the LG & E Energy Corp. Savings Plan (the "Plan"); and
WHEREAS, Section 13.1 of the Plan provides that the Board of Directors of
the Sponsor may amend the Plan at any time; and
WHEREAS, the Board of Directors desires to amend the Plan;
NOW, THEREFORE, the Plan is hereby amended as follows:
1. Section 15.2 is hereby deleted and replace in its entirety to read as
follows:
Section 15.2 MINIMUM CONTRIBUTION
Regardless of hours worked or level of compensation, each
active Participant who is not a Key Employee shall be
entitled to a minimum allocation of contributions and
forfeitures equal to the lesser of (i) three percent (3%) of
the Participant's Compensation for the Plan Year; and (ii)
provided that the Plan is not part of a Required Aggregation
Group with a Defined Benefit Plan because the Plan enables
the Defined Benefit Plan to meet the requirements of Code
Section 401(a)(4) or 410, the highest percentage of
Compensation contributed on behalf of, plus forfeitures
allocated to, a Key Employee [(including Salary
Redirection)]. In the case of a Participant who is also a
participant in a defined benefit plan maintained by the
Employer, the minimum accrued benefit provided in the
defined benefit plan pursuant to Code Section 416(c)(1)
equal to two percent (2%) of the Participant's average
monthly compensation for the five (5) consecutive years when
his aggregate compensation was highest multiplied by his
years of credited service up to ten (10) years for each Plan
Year in which the Plan is top heavy, shall be the only
minimum benefit for both that plan and this Plan, and the
minimum allocation described above shall not apply. In the
event that the vesting schedule in Section 8.7,9.3, or 10.3
is less liberal that the vesting schedule hereinafter
provided, then such vesting schedule shall be substituted
with the following:
Years of Service Vested Percentage
---------------- -----------------
Less than 2 years 0%
2 but less than 3 20%
3 but less than 4 40%
4 but less than 5 60%
5 but less than 6 80%
6 years or more 100%
Should the Plan cease to be a Top Heavy Plan, the vesting
schedule in Section 8.7, 9.3, or 10.3 shall be put back into
effect. However, the vested percentage of any Participant
cannot be decreased as a result of the return of the prior
vesting schedule and any Participant with three (3) or more
Years of Service may elect within the later of: (1) sixty
(60) days after the Plan ceases to be a Top Heavy Plan or
(2) sixty (60) days after the date the Participant is issued
written notification of the change in the vesting schedules,
to remain under the special vesting rules described in this
Section 15.2.
2. Section 5.6 is hereby deleted and replaced in its entirety to read as
follows:
Section 5.6 TERMINATION OF EMPLOYMENT
Upon termination of employment with the Company for any
reason (other than Normal Retirement, Late Retirement, total
and permanent Disability, or Death), a Participant shall be
entitled to a benefit equal to the vested value of his
Individual Account as of the Valuation Date on which the
distribution is made. Except as provided in Section 8.7,9.3,
or 10.3, the Participant shall be fully-vested in his
Individual Account.
3. Section 3.5(f) is hereby deleted and replaced in its entirety to read as
follows:
3.5(f) If neither Test I nor Test II is satisfied for any Plan
Year, the Plan shall nevertheless be deemed to comply with
the requirements of Section 401(m) of the Code for such Plan
Year if, before the last day of the following Plan Year, the
amount of any excess contribution (adjusted for income or
loss for the Plan Year computed using any reasonable method
that satisfies Code Section 401(a)(4) provided it is used
consistently for all Participants and for all corrective
distributions under the Plan for the Plan Year and provided
it is used by the Plan for allocating income or loss to
Participants' Individual Accounts) is distributed to the
Participant, or if forfeitable, is forfeited. Prior to
January 1, 1997, in the case of family aggregation pursuant
to Section 1.28(c), excess contributions under this Section
shall be allocated to Participants who are subject to the
family aggregation rules of Code Section 414(q)(6) in the
manner prescribed by regulations. For purposes of this
Section, the term "excess contributions" means, with respect
to any Plan Year, the excess of:
(1) The aggregate amount of Matching Contributions actually
paid to the Trust Fund on behalf of Highly Compensated
Employees for the Plan Year, over
(2) The maximum amount of such contributions permitted
under Subsection (e) of this Section.
In the event that the tests in Subsection (e) of this
Section are performed on a restructured basis pursuant to
the regulations under Code Section 401(a)(4), excess
contributions pursuant to this Subsection may be determined
on a restructured basis.
4. Section 4.5 is hereby deleted and replaced in its entirety to read as
follows:
Section 4.5 MAXIMUM ADDITIONS
Anything herein to the contrary notwithstanding, the total
Annual Additions of a Participant for any Limitation Year
when combined with any similar annual additions credited to
the Participant for the same period from another qualified
Defined Contribution Plan maintained by the Company, shall
not exceed the lesser of the amounts determined pursuant to
Subsection (a) or (b) of this Section.
(a) Thirty thousand dollars ($30,000) or prior to January 1,
1995, if greater, twenty-five percent (25%) of the dollar
limitation in effect under Code Section 415(b)(1)(A); or
(b) Twenty-five percent (25%) of the Participant's compensation
received from the Company for such Limitation Year, as
determined pursuant to Section 415 of the Code.
(c) In the event a Participant is covered by one or more Defined
Contribution Plans maintained by the Company, the maximum
annual additions as noted above shall be decreased in any
other Defined Contribution Plan as determined necessary by
the Company, prior to a reduction of this Plan, to ensure
that all such plans will remain qualified under the Code.
5. Section 1.28 is hereby deleted and replaced in its entirety to read as
follows:
Section 1.28 HIGHLY COMPENSATED EMPLOYEES will be determined in accordance
with Subsection (a) through (l) for Plan Years prior to January
1, 1997 and in accordance with subsection (m) for Plan Years
commencing on or after January 1, 1997 as follows:
(a) HIGHLY COMPENSATED EMPLOYEE means an employee who during the
look back year or the determination year:
(1) Was at any time a five percent (5%) owner of the
Employer;
(2) Received compensation from the Company in excess of
seventy-five thousand dollars ($75,000) (or such higher
amount as may be provided under Code Section 414(q));
(3) Received compensation from the Company in excess of
fifty thousand dollars ($50,000) (or such higher amount
as may be provided under Code Section 414(q)) and was
in a group consisting of the top twenty percent (20%)
of the employees of the Company when ranked on the
basis of compensation; or
(4) Was at any time an officer and received compensation
greater than fifty percent (50%) of the maximum amount
under Code Section 415(b)(1)(A). Not more than fifty
(50) officers (or, if lesser, the greater of three (3)
employees or ten percent (10%) of the employees) shall
be considered under this Subsection as Highly
Compensated Employees. If no officer is described
above, then the highest paid officer shall be treated
as described in this item (4).
(b) If the employee was not a Highly Compensated Employee for
the look back year, then he shall not be considered a Highly
Compensated Employee for the determination year unless he is
a five percent (5%) owner of the Employer or one of the
highest paid one hundred (100) employees and meets the
criteria of items (2), (3) or (4) of Subsection (a) of this
Section.
(c) Prior to January 1, 1997, if the Highly Compensated Employee
is a five percent (5%) owner or one of the ten (10) most
highly compensated employees, then the compensation and
contributions of employees who are spouses, lineal
descendants, ascendants or spouses of lineal descendants or
ascendants of such Highly Compensated Employees shall be
attributed to the Highly Compensated Employee and the
employees who are such relatives shall not be considered as
separate employees. In the event that family aggregation is
required, the limitation on compensation pursuant to Code
Section 401(a)(17) will be allocated among those family
members who have not attained age nineteen (19) by the close
of the Plan Year by multiplying the limitation by a
fraction, the numerator of which is the individual family
member's compensation and the denominator of which is the
total compensation of all members of the family group or in
such other manner as provided by regulation and
pronouncements of the Internal Revenue Service.
(d) For purposes of determining Highly Compensated Employees,
compensation shall mean compensation paid by the Company for
purposes of Code Section 415(c)(3) and shall include amounts
deferred
pursuant to Code Sections 125 (flexible benefit plans);
402(a)(8) (salary redirection); and 402(h)(1)(B) (simplified
employee plans).
(e) For purposes of determining the top twenty percent (20%) of
employees and the number of officers counted as Highly
Compensated Employees, the following employees shall be
excluded:
(1) Employees who have not completed six (6) months of
service,
(2) Employees who normally work less than seventeen and
one-half (17-1/2) hours per week,
(3) Employees who normally work during not more than six
(6) months during the Plan Year,
(4) Employees who have not attained age twenty-one (21),
(5) Employees included in a collective bargaining unit
covered by an agreement with the Company (to the extent
permitted by regulations), and
(6) Employees who are non-resident aliens.
(f) A former employee shall be treated as a Highly Compensated
Employee if (1) such employee was a Highly Compensated
Employee when such employee separated from Service, or (2),
such employee was a Highly Compensated Employee at any time
after attainment of age fifty-five (55).
(g) Except as otherwise provided in this Section, the term "look
back year" shall mean the twelve (12) month period
immediately preceding the determination year.
(h) Except as otherwise provided in this Section the term
"determination year" shall mean the current Plan Year.
(i) To the extent permitted by regulations under Code Section
414(q), the Employer may elect to make the look back year
calculation on the basis of the calendar year ending with or
within the applicable determination year (or, in the case of
a determination year that is shorter than twelve (12)
months, the calendar year ending with or within the twelve
(12) month period ending with the end of the determination
year). In such case, the Employer must make the
determination year calculation on the basis of the period
(if any) by which the applicable determination year extends
beyond such calendar year. If the Employer makes the
election
provided for in this Subsection, such election must be made
with respect to all plans, entities and arrangements of the
Employer.
(j) The determination of Highly Compensated Employees shall be
determined on a Company wide basis and shall not be
determined on an Employer by Employer or plan by plan basis.
(k) If the Employer so elects for a year, item (2) of Subsection
(a) of this Section shall be applied by substituting fifty
thousand dollars ($50,000) in place of seventy-five thousand
dollars ($75,000), and item (3) of Subsection (a) of this
Section shall not apply, provided that:
(1) At all times during such year, the Employer maintained
substantial business activities and employed employees
in at least two (2) significantly separate geographic
areas, and
(2) The Employer satisfies such other conditions as may be
prescribed by the Secretary of the Treasury.
(l) The determination of Highly Compensated Employees shall be
governed by Code Section 414(q) and the regulations issued
thereunder.
(m) An Employee is a Highly Compensated Employee, if he was a 5%
owner, as that term is defined in Code Section 416(i),
either during the prior Plan Year, or the current Plan Year.
An Employee is also a Highly Compensated Employee if he or
she had Compensation in excess of $80,000 for the prior Plan
Year. If the Employees have Compensation in excess of
$80,000 for the prior Plan Year, but who were not in the top
paid group for the prior Plan Year, shall not be considered
Highly Compensated Employees. The $80,000 threshold cited
above, shall be adjusted by the Secretary, pursuant to Code
Section 415(d), except that the base period is the calendar
quarter ending September 30, 1996. An Employee is in the top
paid group if he or she is in the top 20% of all Employees,
ranked by Compensation, in descending order. In determining
ownership, the rules of Code Section 318 apply. In making
other determinations, including the determination of the top
paid group, the Regulations under Code Section 414(q) apply.
For the Plan Year beginning in 1997, these rules apply as if
they were in effect during the Plan Year beginning in 1996.
For purposes of this definition, Compensation for the Plan
Year beginning in 1997 means compensation as defined in Code
Section 415(c)(3), but including in compensation amounts
deferred under Code Sections 402(e)(3), 125, and
402(h)(1)(B). For purposes of this definition, Compensation
for Plan Years beginning after 1997 means Compensation as
defined in Code Section 415(c)(3).
6. Section 1.34 is hereby deleted and replaced in its entirety to read as
follows:
Section 1.34 LEASED EMPLOYEE shall mean any person (other than an employee of
the recipient) who provides services to the recipient if such
services are provided pursuant to an agreement between the
recipient and any other person ("leasing organization"), such
person has performed such services for the recipient (or for the
recipient and any related persons determined in accordance with
Code Section 414(n)(6)) on a substantially full-time basis for a
period of one (1) year, and such services are of a type
historically performed by employees in the business field of the
recipient employer, effective January 1, 1997, and whose services
are performed under primary direction or control by the
recipient.
7. Section 2.1 is hereby deleted and replaced in its entirety to read as
follows:
Section 2.1 ELIGIBILITY REQUIREMENTS
Each Employee shall be eligible to participate as of the Entry Date coincident
with or next following the completion of six (6) months, three (3) months
effective January 1, 1998, of employment in the twelve (12) month period
commencing on the date he first performs an Hour of Service as defined in
Department of Labor regulation Section 2530.200b-2, or in any calendar year.
Notwithstanding the preceding, if an Employee was first employed by the Company
on or after January 1, 1991, and prior to October 1, 1991, said Employee shall
be eligible to participate in the Plan on January 1, 1992. 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 Code Section 414(u).
8. Section 6.2(a) is hereby deleted and replaced in its entirety to read as
follows:
6.2(a) The Participant shall authorize his Employer to deduct approximately
equal interest and principal payments from his compensation payable at the end
of each regular pay period (no less frequently than quarterly) in an amount
equal to at least ten dollars ($10.00) with respect to each outstanding loan. In
the event an inactive Participant or Beneficiary receives a loan hereunder or in
the event that a Participant who received a loan ceases to be actively employed
by the Company, repayments shall be made to the Committee pursuant to the terms
of the promissory note (no less frequently than quarterly). Notwithstanding any
provision of this Plan to the contrary, loan repayments shall be suspended with
respect to a Participant on qualified military service as defined by Code
Section 414(u). The Committee shall transfer payments under this Subsection to
the Investment Manager within a reasonable period of time.
9.. Section 3.5(c) is hereby deleted and replaced in its entirety to read as
follows:
Section 3.5 NONDISCRIMINATION TEST FOR OTHER CONTRIBUTIONS
(c) The term "actual contribution percentage," means the average
of the following percentages (calculated separately for each
eligible Employee
for the current Plan Year): Matching Contributions (and
Salary Redirection to the extent elected by the Employer and
permitted by Regulations under Code Section 401(m)) on
behalf of each eligible Employee divided by compensation of
the eligible Employee. In calculating the actual
contribution percentage of a Highly Compensated Employee who
participates in more than one arrangement of the Company
subject to Code Section 401(m), all arrangements subject to
Code Section 401(m) ending with or within the same calendar
year shall be treated as a single arrangement.
10. Section 3.5(a) is hereby deleted and replaced in its entirety to read as
follows:
Section 3.5 NONDISCRIMINATION TEST FOR OTHER CONTRIBUTIONS
(a) Periodically as determined by the Employer, the Employer
shall check the actual contribution percentages against the
tests identified below. For Plan Years prior to January 1,
1997, in the event that neither test is met, the Employer
shall reduce the Matching Contribution percentages of Highly
Compensated Employees that are above the maximum
contribution percentage allowed under the tests. Beginning
with the highest such percentage, each contribution
percentage shall be reduced to the next highest percentage,
and so forth, until the excess is eliminated. If it is
necessary to reduce the Employer Matching Contribution the
Participant shall nevertheless receive from the Plan a
distribution equal to the Employer Matching Contribution
plus any income thereon that would have been allocated to
him had such reduction in contribution not been necessary.
Effective for Plan Years commencing on or after January 1,
1997, Excess Aggregate Contributions shall be determined,
with respect to any Plan Year, as the excess of: a. The
aggregate Contribution Percentage Amounts taken into account
in computing the numerator of the Contribution Percentage
actually made on behalf of Highly Compensated Employees for
such Plan Year, over, b. The maximum Contribution Percentage
permitted by the ACP test (determined by reducing
contributions made on behalf of Highly Compensated Employees
in order of their Contribution Percentages beginning with
the highest of such percentages. Upon the determination of
the total Excess Aggregate Contributions, said amounts shall
be distributed in a manner such that Highly Compensated
Employees with the largest Contribution Percentage Amounts
taken in to account in calculating the ACP test for the year
in which the excess arose, beginning with the Highly
Compensated Employee with the largest amount of such
Contribution Percentage Amounts and continuing in descending
order until all of the Excess Aggregator Contributions have
been allocated.
11. Section 3.4(a) is hereby deleted and replaced in its entirety to read as
follows:
Section 3.4 NONDISCRIMINATION TEST FOR SALARY REDIRECTION
(a) Periodically as determined by the Employer, the Employer
shall check the actual deferral percentages against the
tests identified below. For Plan Years prior to January 1,
1997, in the event that neither test is met, the Employer
shall reduce the Salary Redirection percentages of Highly
Compensated Employees that are above the maximum deferral
percentage allowed under the tests; provided that the
initial reductions shall be in unmatched Salary Redirection,
and only if such redirections are not sufficient shall
matched Salary Redirection be reduced. Beginning with the
highest such percentage, each contribution percentage shall
be reduced to the next highest percentage, and so forth,
until the excess is eliminated. If it is necessary to reduce
the matched Salary Redirection, the Participant shall
nevertheless receive from the Plan a distribution equal to
the Employer Matching Contribution plus any income thereon
that would have been allocated to him had such reduction in
contribution not been necessary. Effective for Plan Years
commencing on or after January 1, 1997, Excess Aggregate
Contributions shall be determined, with respect to any Plan
Year, as the excess of: a. The aggregate Contribution
Percentage Amounts taken into account in computing the
numerator of the Deferral Percentage actually made on behalf
of Highly Compensated Employees for such Plan Year, over, b.
The maximum Contribution Percentage permitted by the ADP
test (determined by reducing contributions made on behalf of
Highly Compensated Employees in order of their Contribution
Percentages beginning with the highest of such percentages.
Upon the determination of the total Excess Aggregate
Contributions, said amounts shall be distributed in a manner
such that Highly Compensated Employees with the largest
Contribution Percentage Amounts taken in to account in
calculating the ACP test for the year in which the excess
arose, beginning with the Highly Compensated Employee with
the largest amount of such Contribution Percentage Amounts
and continuing in descending order until all of the Excess
Aggregator Contributions have been allocated.
12. Section 3.1(a) is hereby deleted and replaced in its entirety to read as
follows:
3.1 SALARY REDIRECTION
Each Employee employed by an Employer listed on Appendix A
who satisfies the requirements of Section 2.1 may elect to
have Salary Redirection made on his behalf, commencing on
the date specified in Section 2.1. Such election shall be
made by entering into a Salary Redirection agreement with
the Employer in which it is agreed that the Employer will
redirect a portion of the Participant's Compensation and
contribute that designated amount to the Trust Fund on
behalf of the Participant in accordance with the following.
(a) SALARY REDIRECTION AGREEMENT. Each eligible Employee may
enter into a Salary Redirection agreement under which the
Employee's Employer will redirect a portion of the
Participant's Compensation during each payroll period in an
amount equal to an integral percentage from one percent (1%)
to sixteen percent (16%) of such Compensation and
contribute such percentage to the Trust Fund on behalf of
Participant. Said contributions shall be nonforfeitable.
13. Section 3.4(c) is hereby deleted and replaced in its entirety to read as
follows:
3.4(c) The term "actual deferral percentage," means the average
of the following percentages (calculated separately for each
eligible Employee): Salary Redirection contributions on
behalf of each eligible Employee divided by the compensation
of the eligible Employee for the current Plan Year. Matching
Contributions will be included in the numerator to the
extent that those contributions are not included for
purposes of calculating the actual contribution percentage
under Section 3.5. In calculating the actual deferral
percentage of a Highly Compensated Employee who participates
in more than one cash or deferred arrangement of the
Company, all cash or deferred arrangements ending with or
within the same calendar year shall be treated as a single
arrangement.
14. Section 7.6(a) is hereby deleted and replaced in its entirety to read as
follows:
Section 7.6 LOANS
(a) AUTHORIZATION OF LOAN
Effective January 1, 1998, the Board of Directors may direct
the Trustee to incur a loan on behalf of the Trust in a
manner and under conditions which will cause the loan to be
an "exempt loan" within the meaning of Section 4975(d)(2) of
the Code and Regulations thereunder. A loan shall be used
primarily for the benefit of Plan Participants and their
Beneficiaries. The proceeds of each such loan shall be used,
within a reasonable time after the loan is obtained, only to
purchase Company Stock, to repay the loan or to repay any
prior loan. Any such loan shall provide for a reasonable
rate of interest, an ascertainable period of maturity and
shall be without recourse against the Plan. Any such loan
shall be secured solely by shares of Company Stock acquired
with the proceeds of the loan and shares of such stock that
were used as collateral on a prior loan which was repaid
with the proceeds of the current loan. Such stock pledged,
as collateral
shall be placed in a Suspense Account and released pursuant
to Subsection 7.06(b), as the loan is repaid. Such stock
shall not accrue for the benefit of (i) any taxpayer who
makes an election under section 1042(a) with respect to
employer securities, (ii) any individual who is related to
the taxpayer (within the meaning of section 267(b). Such
stock shall not be subject to put, call, or other option, or
other buy-sell or similar arrangement. Company Stock
released from the Suspense Account shall be allocated in the
ratio that each eligible Participant's Compensation, bears
to the total Compensation, paid to all Participants during
the Plan Year. No person entitled to payment under a loan
made pursuant to this Section shall have recourse against
any Trust Fund assets other than the stock used as
collateral for the loan, Sponsoring Employer contributions
of cash that are available to meet obligations under the
loan and earnings attributable to such collateral and the
investment of such contributions. Employer contributions
made with respect to any Plan Year during which the loan
remains unpaid, and earnings on such contributions, shall be
deemed available to meet obligations under the loan, unless
otherwise provided by the Employer at the time such
contributions are made. In the event of a default of a loan
made pursuant to this section, the stock transferred in
satisfaction of the loan must not exceed the amount of the
default.
15. Section 4.4 is hereby deleted and replaced in its entirety to read as
follows:
Section 4.4 TRUSTEE AND COMMITTEE JUDGMENT CONTROLS
In determining the fair market value of the Trust Fund and
of Individual Accounts, the Trustee and the Committee shall
exercise their best judgment, and all such determinations of
value (in the absence of bad faith) shall be binding upon
all Participants and their beneficiaries. In the case of
employer securities that are not readily tradable on an
established market shall be valued by an independent
appraiser. All allocations shall be deemed to have been made
as of the Valuation Date, regardless of when actual
allocations were undertaken.
16. Section 8.2(a) is hereby deleted and replaced in its entirety to read as
follows:
"(a) AMOUNT OF PROFIT SHARING CONTRIBUTIONS
As of each December 31 Valuation Date for each Plan Year, beginning with the
1998 Plan Year, each Participating Employer shall contribute to the respective
Profit Sharing Account of Participants who are entitled to allocations under
Subsection 8.2(b) such Participating Employer's net profit for the taxable year
ending with or within such Plan Year in the amount of three percent (3%) of
eligible Compensation. In the discretion of the Board of Directors, such
contribution may be increased or decreased. Such Profit Sharing Contribution
shall not exceed
the lesser of the amount deductible under Section 404 of the Code, or the amount
that are allowable as Annual Additions.
IN WITNESS WHEREOF, and as evidence of the adoption of this amendment by the
Sponsor, the undersigned officer being duly authorized has signed this amendment
this ______ day of ________________, 2000.
LG&E ENERGY CORP.
WKE CORP. SAVINGS PLAN
INSTRUMENT OF AMENDMENT
WHEREAS, WKE Corp. (the "Sponsor") adopted and maintains the WKE Corp.
Savings Plan (the "Plan"); and
WHEREAS, Section 10.1 of the Plan provides that the Board of Directors of
the Sponsor may amend the Plan at any time; and
WHEREAS, the Board of Directors desires to amend the Plan;
NOW, THEREFORE, the Plan is hereby amended as follows:
1. Section 4.5 is hereby deleted and replace in its entirety to read as
follows:
Section 4.5 MAXIMUM ADDITIONS
Anything herein to the contrary notwithstanding, the total Annual
additions of a Participant for any Limitation Year when combined
with any similar annual additions credited to the Participant for
the same period from another qualified Defined Contribution Plan
maintained by the Company, shall not exceed the lesser of the
amounts determined pursuant to Subsection (a) or (b) of this
Section.
(a) Thirty thousand dollars ($30,000); or
(b) Twenty-five percent (25%) of the Participant's compensation
received from the Company for such Limitation Year, as determined
pursuant to Section 415 of the Code.
(c) In the event a Participant is covered by one or more Defined
Contribution Plans maintained by the Company, the maximum annual
additions as noted above shall be decreased in any other Defined
Contribution Plan as determined necessary by the Company, prior
to a reduction of this Plan, to ensure that all such plans will
remain qualified under the Code.
2. Section 1.30 is hereby deleted and replaced in its entirety to read as
follows:
Section 1.30 LEASED EMPLOYEE shall mean any person (other than an employee of
the recipient) who provides services to the recipient if such
services are provided pursuant to an agreement between the
recipient and any other person ("leasing organization"), such
person has performed such services for the recipient (or for the
recipient and any related persons determined in accordance with
Code Section 414(n)(6)) on a substantially full-time basis for a
period of one (1) year,
such services are of a type historically performed by employees
in the business field of the recipient employer, and whose
services are performed under primary direction or control by the
recipient.
3. Section 2.1 is hereby deleted and replaced in its entirety to read as
follows:
Section 2.1 ELIGIBILITY REQUIREMENTS
Each Employee shall be eligible to participate as of the Entry Date
coincident with or next following the completion of six (6) months,
three (3) months effective January 1, 1998, of employment in the twelve
(12) month period commencing on the date he first performs an Hour of
Service as defined in Department of Labor regulation Section
2530.200b-2, or in any calendar year. Notwithstanding the preceding, if
an Employee was first employed by the Company on or after January 1,
1991, and prior to October 1, 1991, said Employee shall be eligible to
participate in the Plan on January 1, 1992. 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 Code Section 414(u).
4. Section 6.4(f) is hereby deleted and replaced in its entirety to read as
follows:
Section 6.4(f) The Participant shall authorize the Employer to deduct
from his compensation substantially equal installments consisting of
interest and principal payable at the end of each regular pay period
(but no less frequently than quarterly). The Employer shall transfer
such payroll deductions to the Trustee within a reasonable time
following the end of each regular pay period. In the event that the
Participant ceases to be employed by the Employer, the outstanding
principal and any interest due to date on the outstanding principal
balance shall be immediately due and payable upon demand.
Notwithstanding the preceding, if a Participant is still employed but
is on an unpaid leave of absence or is otherwise not receiving
compensation from the Employer, repayment shall be made pursuant to the
terms of the promissory note (but no less frequently than quarterly).
Notwithstanding any provision of this Plan to the contrary, loan
repayments shall be suspended with respect to a Participant on
qualified military service as defined by Code Section 414(u). The
Committee shall transfer payments under this Subsection to the
Investment Manager within a reasonable period of time.
IN WITNESS WHEREOF, and as evidence of the adoption of this amendment by the
Sponsor, the undersigned officer being duly authorized has signed this amendment
this ______ day of ________________, 2000.
WKE CORP.
By:___________________
Duly authorized
ATTEST:
By:___________________
By:_________________________
Duly authorized
ATTEST:
By:_________________________
401(K) SAVINGS PLAN FOR EMPLOYEES OF
LOUISVILLE GAS & ELECTRIC COMPANY WHO ARE
REPRESENTED BY LOCAL 2100 OF IBEW
INSTRUMENT OF AMENDMENT
WHEREAS, Louisville Gas & Electric Company (the "Sponsor") previously
adopted and maintains the 401(k) Savings Plan for Employees of Louisville Gas &
Electric Company Who Are Represented By Local 2100 of IBEW (the "Plan"); and
WHEREAS, Section 10.1 of the Plan provides that the Board of Directors of
the Sponsor may amend the Plan at any time; and
WHEREAS, the Board of Directors desires to amend the Plan;
NOW, THEREFORE, the Plan is hereby amended as follows:
1. Section 5.9(a) shall be amended and replaced in its entirety to reads as
follows:
"Section 5.9 METHODS OF PAYMENT
(a) A Participant or Beneficiary shall elect a
distribution of the Individual Account as provided
hereinafter. No other manner of distribution shall be
provided. The request by the Participant or the Beneficiary
shall be in writing and shall be filed with the Committee at
least thirty (30) days before distribution is to be made.
Effective June 1, 1998 the request by the Participant or the
Beneficiary shall be in a manner and time prescribed by the
Committee. The Committee may not require a distribution
without the consent of the Participant prior to his reaching
the later of Normal Retirement Age or, if the Participant is
deceased, without the consent of his spouse, if living, or
of his Beneficiary, unless the vested value of the
Individual Account is not more than three thousand five
hundred dollars ($3,500) or effective June 1, 1998 five
thousand dollars ($5,000). If the vested value of the
Participant's Individual Account is less than three thousand
five hundred dollars ($3,500) or effective June 1, 1998 five
thousand dollars ($5,000), the benefits payable will be paid
as soon as reasonably possible following the actual date of
severance, notwithstanding lack of consent. If the vested
value of the Participant's Individual Account has been more
than three thousand five hundred dollars ($3,500) at the
time of any distribution, the value the Participant's
Individual Account will be deemed to be more than three
thousand five hundred dollars ($3,500) at the time of any
subsequent distribution for purposes of the consent
requirements of this paragraph. Notwithstanding the above,
no lump sum distribution may be made after periodic payments
have commenced unless the Participant or the Participant's
surviving spouse consents in writing to the distribution.
The alternative forms of distribution are as follows:
(1) A lump sum distribution in cash or securities; or
(2) Periodic installment payments (either monthly or
annually) for a period not to exceed ten (10) years as
selected by the Participant or Beneficiary; or
(3) Any combination of the above.
2. Section 3.5(f) is hereby deleted and replaced in its entirety to read as
follows:
3.5(f) If neither Test I nor Test II is satisfied for any Plan
Year, the Plan shall nevertheless be deemed to comply with
the requirements of Section 401(m) of the Code for such Plan
Year if, before the last day of the following Plan Year, the
amount of any excess contribution (adjusted for income or
loss for the Plan Year computed using any reasonable method
that satisfies Code Section 401(a)(4) provided it is used
consistently for all Participants and for all corrective
distributions under the Plan for the Plan Year and provided
it is used by the Plan for allocating income or loss to
Participants' Individual Accounts) is distributed to the
Participant, or if forfeitable, is forfeited. Prior to
January 1, 1997, in the case of family aggregation pursuant
to Section 1.28(c), excess contributions under this Section
shall be allocated to Participants who are subject to the
family aggregation rules of Code Section 414(q)(6) in the
manner prescribed by regulations. For purposes of this
Section, the term "excess contributions" means, with respect
to any Plan Year, the excess of:
(4) The aggregate amount of Matching Contributions actually
paid to the Trust Fund on behalf of Highly Compensated
Employees for the Plan Year, over
(5) The maximum amount of such contributions permitted
under Subsection (e) of this Section.
In the event that the tests in Subsection (e) of this
Section are performed on a restructured basis pursuant to
the regulations under Code Section 401(a)(4), excess
contributions pursuant to this Subsection may be determined
on a restructured basis.
4. Section 4.5 is hereby deleted and replaced in its entirety to read as
follows:
Section 4.5 MAXIMUM ADDITIONS
Anything herein to the contrary notwithstanding, the total
Annual Additions of a Participant for any Limitation Year
when combined with any similar annual additions credited to
the Participant for the same period from another qualified
Defined Contribution Plan maintained by the Company, shall
not exceed the lesser of the amounts determined pursuant to
Subsection (a) or (b) of this Section.
(a) Thirty thousand dollars ($30,000) or prior to January 1,
1995, if greater, twenty-five percent (25%) of the dollar
limitation in effect under Code Section 415(b)(1)(A); or
(b) Twenty-five percent (25%) of the Participant's compensation
received from the Company for such Limitation Year, as
determined pursuant to Section 415 of the Code.
(c) In the event a Participant is covered by one or more Defined
Contribution Plans maintained by the Company, the maximum
annual additions as noted above shall be decreased in any
other Defined Contribution Plan as determined necessary by
the Company, prior to a reduction of this Plan, to ensure
that all such plans will remain qualified under the Code.
5. Section 1.24 is hereby deleted and replaced in its entirety to read as
follows:
Section 1.24 HIGHLY COMPENSATED EMPLOYEES will be determined in accordance
with Subsection (a) through (l) for Plan Years prior to January
1, 1997 and in accordance with subsection (m) for Plan Years
commencing on or after January 1, 1997 as follows:
(a) HIGHLY COMPENSATED EMPLOYEE means an employee who during the
look back year or the determination year:
(1) Was at any time a five percent (5%) owner of the
Employer;
(2) Received compensation from the Company in excess of
seventy-five thousand dollars ($75,000) (or such higher
amount as may be provided under Code Section 414(q));
(3) Received compensation from the Company in excess of
fifty thousand dollars ($50,000) (or such higher amount
as may be provided under Code Section 414(q)) and was
in a group consisting of the top twenty percent (20%)
of the employees of the Company when ranked on the
basis of compensation; or
(4) Was at any time an officer and received compensation
greater than fifty percent (50%) of the maximum amount
under Code Section 415(b)(1)(A). Not more than fifty
(50) officers (or, if lesser, the greater of three (3)
employees or ten percent (10%) of the employees) shall
be considered under this Subsection as Highly
Compensated Employees. If no officer is described
above, then the highest paid officer shall be treated
as described in this item (4).
(b) If the employee was not a Highly Compensated Employee for
the look back year, then he shall not be considered a Highly
Compensated Employee for the determination year unless he is
a five percent (5%) owner of the Employer or one of the
highest paid one hundred (100) employees and meets the
criteria of items (2), (3) or (4) of Subsection (a) of this
Section.
(c) Prior to January 1, 1997, if the Highly Compensated Employee
is a five percent (5%) owner or one of the ten (10) most
highly compensated employees, then the compensation and
contributions of employees who are spouses, lineal
descendants, ascendants or spouses of lineal descendants or
ascendants of such Highly Compensated Employees shall be
attributed to the Highly Compensated Employee and the
employees who are such relatives shall not be considered as
separate employees. In the event that family aggregation is
required, the limitation on compensation pursuant to Code
Section 401(a)(17) will be allocated among those family
members who have not attained age nineteen (19) by the close
of the Plan Year by multiplying the limitation by a
fraction, the numerator of which is the individual family
member's compensation and the denominator of which is the
total compensation of all members of the family group or in
such other manner as provided by regulation and
pronouncements of the Internal Revenue Service.
(d) For purposes of determining Highly Compensated Employees,
compensation shall mean compensation paid by the Company for
purposes of Code Section 415(c)(3) and shall include amounts
deferred pursuant to Code Sections 125 (flexible benefit
plans); 402(a)(8) (salary redirection); and 402(h)(1)(B)
(simplified employee plans).
(e) For purposes of determining the top twenty percent (20%) of
employees and the number of officers counted as Highly
Compensated Employees, the following employees shall be
excluded:
(1) Employees who have not completed six (6) months of
service,
(2) Employees who normally work less than seventeen and
one-half (17-1/2) hours per week,
(3) Employees who normally work during not more than six
(6) months during the Plan Year,
(4) Employees who have not attained age twenty-one (21),
(5) Employees included in a collective bargaining unit
covered by an agreement with the Company (to the extent
permitted by regulations), and
(6) Employees who are non-resident aliens.
(f) A former employee shall be treated as a Highly Compensated
Employee if (1) such employee was a Highly Compensated
Employee when such employee separated from Service, or (2),
such employee was a Highly Compensated Employee at any time
after attainment of age fifty-five (55).
(g) Except as otherwise provided in this Section, the term "look
back year" shall mean the twelve (12) month period
immediately preceding the determination year.
(h) Except as otherwise provided in this Section the term
"determination year" shall mean the current Plan Year.
(i) To the extent permitted by regulations under Code Section
414(q), the Employer may elect to make the look back year
calculation on the basis of the calendar year ending with or
within the applicable determination year (or, in the case of
a determination year that is shorter than twelve (12)
months, the calendar year ending with or within the twelve
(12) month period ending with the end of the determination
year). In such case, the Employer must make the
determination year calculation on the basis of the period
(if any) by which the applicable determination year extends
beyond such calendar year. If the Employer makes the
election provided for in this Subsection, such election must
be made with respect to all plans, entities and arrangements
of the Employer.
(j) The determination of Highly Compensated Employees shall be
determined on a Company wide basis and shall not be
determined on an Employer by Employer or plan by plan basis.
(k) If the Employer so elects for a year, item (2) of Subsection
(a) of this Section shall be applied by substituting fifty
thousand dollars ($50,000) in place of seventy-five thousand
dollars ($75,000), and item (3) of Subsection (a) of this
Section shall not apply, provided that:
(1) At all times during such year, the Employer maintained
substantial business activities and employed employees
in at least two (2) significantly separate geographic
areas, and
(2) The Employer satisfies such other conditions as may be
prescribed by the Secretary of the Treasury.
(l) The determination of Highly Compensated Employees shall be
governed by Code Section 414(q) and the regulations issued
thereunder.
(n) An Employee is a Highly Compensated Employee, if he was a 5%
owner, as that term is defined in Code Section 416(i),
either during the prior Plan Year, or the current Plan Year.
An Employee is also a Highly Compensated Employee if he or
she had Compensation in excess of $80,000 for the prior Plan
Year. If the Employees have Compensation in excess of
$80,000 for the prior Plan Year, but who were not in the top
paid group for the prior Plan Year, shall not be considered
Highly Compensated Employees. The $80,000 threshold cited
above, shall be adjusted by the Secretary, pursuant to Code
Section 415(d), except that the base period is the calendar
quarter ending September 30, 1996. An Employee is in the top
paid group if he or she is in the top 20% of all Employees,
ranked by Compensation, in descending order. In determining
ownership, the rules of Code Section 318 apply. In making
other determinations, including the determination of the top
paid group, the Regulations under Code Section 414(q) apply.
For the Plan Year beginning in 1997, these rules apply as if
they were in effect during the Plan Year beginning in 1996.
For purposes of this definition, Compensation for the Plan
Year beginning in 1997 means compensation as defined in Code
Section 415(c)(3), but including in compensation amounts
deferred under Code Sections 402(e)(3), 125, and
402(h)(1)(B). For purposes of this definition, Compensation
for Plan Years beginning after 1997 means Compensation as
defined in Code Section 415(c)(3).
6. Section 1.28 is hereby deleted and replaced in its entirety to read as
follows:
Section 1.28 LEASED EMPLOYEE shall mean any person (other than an employee of
the recipient) who provides services to the recipient if such
services are provided pursuant to an agreement between the
recipient and any other person ("leasing organization"), such
person has performed such services for the recipient (or for the
recipient and any related persons determined in accordance with
Code Section 414(n)(6)) on a substantially full-time basis for a
period of one (1) year, and such services are of a type
historically performed by employees in the business field of the
recipient employer, effective January 1, 1997, and whose services
are performed under primary direction or control by the
recipient.
7. Section 2.1 is hereby deleted and replaced in its entirety to read as
follows:
Section 2.1 ELIGIBILITY REQUIREMENTS
Each Employee shall be eligible to participate as of the Entry Date coincident
with or next following the completion of six (6) months of continuous
employment. 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 Code Section 414(u).
8. Section 6.2(g) is hereby deleted and replaced in its entirety to read as
follows:
6.2(g) The Participant shall authorize his Employer to deduct approximately
equal interest and principal payments from his compensation payable at the end
of each regular pay period (no less frequently than quarterly) in an amount
equal to at least ten dollars ($10.00) with respect to each outstanding loan. In
the event an inactive Participant or Beneficiary receives a loan hereunder or in
the event that a Participant who received a loan ceases to be actively employed
by the Company, repayments shall be made to the Committee pursuant to the terms
of the promissory note (no less frequently than quarterly). Notwithstanding any
provision of this Plan to the contrary, loan repayments shall be suspended with
respect to a Participant on qualified military service as defined by Code
Section 414(u). The Committee shall transfer payments under this Subsection to
the Investment Manager within a reasonable period of time.
9. Section 3.4(c) is hereby deleted and replaced in its entirety to read as
follows:
Section 3.4 NONDISCRIMINATION TEST FOR OTHER CONTRIBUTIONS
(d) The term "actual contribution percentage," means the average
of the following percentages (calculated separately for each
eligible Employee for the current Plan Year): Matching
Contributions (and Salary Redirection to the extent elected
by the Employer and permitted by Regulations under Code
Section 401(m)) on behalf of each eligible Employee divided
by compensation of the eligible Employee. In calculating the
actual contribution percentage of a Highly Compensated
Employee who participates in more than one arrangement of
the Company subject to Code Section 401(m), all arrangements
subject to Code Section 401(m) ending with or within the
same calendar year shall be treated as a single arrangement.
10. Section 3.4(a) is hereby deleted and replaced in its entirety to read as
follows:
Section 3.4 NONDISCRIMINATION TEST FOR SALARY REDIRECTION
(a) Periodically as determined by the Employer, the Employer
shall check the actual deferral percentages against the
tests identified below. For Plan Years prior to January 1,
1997, in the event that neither test is met,
the Employer shall reduce the Salary Redirection percentages
of Highly Compensated Employees that are above the maximum
deferral percentage allowed under the tests; provided that
the initial reductions shall be in unmatched Salary
Redirection, and only if such redirections are not
sufficient shall matched Salary Redirection be reduced.
Beginning with the highest such percentage, each
contribution percentage shall be reduced to the next highest
percentage, and so forth, until the excess is eliminated. If
it is necessary to reduce the matched Salary Redirection,
the Participant shall nevertheless receive from the Plan a
distribution equal to the Employer Matching Contribution
plus any income thereon that would have been allocated to
him had such reduction in contribution not been necessary.
Effective for Plan Years commencing on or after January 1,
1997, Excess Aggregate Contributions shall be determined,
with respect to any Plan Year, as the excess of: a. The
aggregate Contribution Percentage Amounts taken into account
in computing the numerator of the Deferral Percentage
actually made on behalf of Highly Compensated Employees for
such Plan Year, over, b. The maximum Contribution Percentage
permitted by the ADP test (determined by reducing
contributions made on behalf of Highly Compensated Employees
in order of their Contribution Percentages beginning with
the highest of such percentages. Upon the determination of
the total Excess Aggregate Contributions, said amounts shall
be distributed in a manner such that Highly Compensated
Employees with the largest Contribution Percentage Amounts
taken in to account in calculating the ACP test for the year
in which the excess arose, beginning with the Highly
Compensated Employee with the largest amount of such
Contribution Percentage Amounts and continuing in descending
order until all of the Excess Aggregator Contributions have
been allocated.
11. Section 3.4(c) is hereby deleted and replaced in its entirety to read as
follows:
3.4(c) The term "actual deferral percentage," means the average
of the following percentages (calculated separately for each
eligible Employee): Salary Redirection contributions on
behalf of each eligible Employee divided by the compensation
of the eligible Employee for the current Plan Year. Matching
Contributions will be included in the numerator to the
extent that those contributions are not included for
purposes of calculating the actual contribution percentage
under Section 3.5. In calculating the actual deferral
percentage of a Highly Compensated Employee who participates
in more than one cash or deferred arrangement of the
Company, all cash or deferred arrangements ending with or
within the same calendar year shall be treated as a single
arrangement.
IN WITNESS WHEREOF, and as evidence of the adoption of this amendment by the
Sponsor, the undersigned officer being duly authorized has signed this amendment
this ______ day of ________________, 2000.
LOUISVILLE GAS & ELECTRIC COMPANY
By:___________________
Duly authorized
ATTEST:
By:____________________
INSTRUMENT OF AMENDMENT
SECOND AMENDMENT OF THE
LG&E ENERGY CORP. SAVINGS PLAN
DECEMBER 11, 2000
WHEREAS, the Board has reserved the right to amend the LG&E Energy Corp. Savings
Plan (the "Plan") in Section 13.1; and
WHEREAS, the Board has determined that it is appropriate to amend the Savings
Plan to remove the LG&E Energy Corp. Common Stock Fund and to add the Powergen
Equity Fund as investment options under the Plan, effective at the time of the
merger.
RESOLVED, that the Plan shall be amended as follows:
1. Section 4.2 shall be amended by deleting it in its entirety and replacing
it as follows:
"Section 4.2 INVESTMENT OF ACCOUNTS
The Individual Account shall be invested by the Trustee in
accordance with the following:
(a) There shall be established the following Investment Funds within
the Trust Fund:
(1) Fidelity Retirement Government Money Market Portfolio,
(2) Fidelity Ginnie Mae Portfolio, frozen effective October 1,
1996,
(3) Fidelity Puritan Fund,
(4) Fidelity Spartan U. S. Equity Index Portfolio,
(5) Fidelity Magellan Fund.
(6) Fidelity Contrafund, effective October 1, 1996,
(7) Fidelity Equity-Income II Fund, effective October 1, 1996,
(8) Warburg Pincus Emerging Growth, effective October 1, 1996,
(9) Templeton Foreign, effective October 1, 1996,
(10) Fidelity Intermediate Bond Fund, effective October 1, 1996,
(11) LG&E Energy Corp. Common Stock Fund, effective January 1,
1998, until December 11, 2000.
(12) Janus Worldwide Fund, effective August 1, 1998.
(13) Powergen Equity Fund, effective December 11, 2000."
2. Section 1.33 shall be amended and replaced in its entirety to read as
follows:
"Section 1.33 LG&E ENERGY CORP. COMMON STOCK FUND means the fund invested
primarily in shares of common stock of LG&E Energy Corp. effective as soon
as administratively feasible after the closing of the merger between LG&E
Energy Corp. and Powergen plc the fund shall be invested in a short term
investment selected by the Benefits Committee."
3. A new Section 1.68 be added to the end of Article 1 to read as follows:
"Section 1.68 Powergen Equity Fund means the fund invested primarily in
equity securities of Powergen plc, effective December 11, 2000."
IN WITNESS WHEREOF, and as evidence of the adoption of this amendment by the
Sponsor, the undersigned officer being duly authorized has signed this amendment
effective as of the date set forth above.
LG&E ENERGY CORP.
By: ____________________
Duly Authorized
Witness:
By:_____________________
INSTRUMENT OF AMENDMENT
SECOND AMENDMENT OF THE
401(K) SAVINGS PLAN FOR EMPLOYEES OF LOUISVILLE GAS AND ELECTRIC COMPANY
WHO ARE REPRESENTED BY LOCAL 2100 OF IBEW
DECEMBER 11, 2000
WHEREAS, the Board has reserved the right to amend the 401(k) Savings Plan for
Employees of Louisville Gas and Electric Company Who Are Represented by Local
2100 Of IBEW (the "Plan") in Section 10.1; and
WHEREAS, the Board has determined that it is appropriate to amend the Savings
Plan to remove the LG&E Energy Corp. Common Stock Fund and to add the Powergen
Equity Fund as investment options under the Plan, effective at the time of the
merger.
NOW, THEREFORE, BE IT RESOLVED, that the Plan be amended as follows:
1. Section 4.2 shall be amended by deleting it in its entirety and replacing
it as follows:
"Section 4.2 INVESTMENT OF ACCOUNTS
The Individual Account shall be invested by the Trustee in accordance
with the following:
(a) There shall be established the following Investment Funds within
the Trust Fund:
(1) Fidelity Retirement Government Money Market Portfolio,
(2) Fidelity Ginnie Mae Portfolio, frozen effective October 1,
1996,
(3) Fidelity Puritan Fund,
(4) Fidelity Spartan U. S. Equity Index Portfolio,
(5) Fidelity Magellan Fund.
(6) Fidelity Contrafund, effective October 1, 1996,
(7) Fidelity Equity-Income II Fund, effective October 1, 1996,
(8) Warburg Pincus Emerging Growth, effective October 1, 1996,
(9) Templeton Foreign, effective October 1, 1996,
(10) Fidelity Intermediate Bond Fund, effective October 1, 1996,
(11) LG&E Energy Corp. Common Stock Fund, effective January 1,
1998, until December 11, 2000.
(12) Janus Worldwide Fund, effective August 1, 1998.
(13) Powergen Equity Fund, effective December 11, 2000."; and
2. Section 1.29 shall be amended and replaced in its entirety to read as
follows:
"Section 1.29 LG&E ENERGY CORP. COMMON STOCK FUND means the fund invested
primarily in shares of common stock of LG&E Energy Corp. Effective as soon
as administratively feasible after the closing of the merger between LG&E
Energy Corp. and Powergen plc the fund shall be invested in a short term
investment selected by the Benefits Committee."; and
3. A new Section 1.49 be added to the end of Article 1 to read as follows:
"Section 1.49 Powergen Equity Fund means the fund invested primarily in
equity securities of Powergen plc, effective December 11, 2000." ;and
IN WITNESS WHEREOF, and as evidence of the adoption of this amendment by the
Sponsor, the undersigned officer being duly authorized has signed this amendment
effective as of the date set forth above.
LOUISVILLE GAS AND ELECTRIC COMPANY
By: ____________________
Duly Authorized
Witness:
By:_____________________
INSTRUMENT OF AMENDMENT
SECOND AMENDMENT OF THE
WKE CORP. SAVINGS PLAN
DECEMBER 11, 2000
WHEREAS, the Board has reserved the right to amend the LG&E Energy Corp. Savings
Plan (the "Plan") in Section 10.1; and
WHEREAS, the Board has determined that it is appropriate to amend the Savings
Plan to remove the LG&E Energy Corp. Common Stock Fund and to add the Powergen
Equity Fund as investment options under the Plan, also effective at the time of
the merger.
RESOLVED, that the Plan shall be amended as follows:
1. Section 4.2 shall be amended by deleting it in its entirety and replacing
it as follows:
"Section 4.2 INVESTMENT OF ACCOUNTS
The Individual Account shall be invested by the Trustee in accordance
with the following:
(a) There shall be established the following Investment Funds within
the Trust Fund:
(1) Fidelity Retirement Government Money Market Portfolio,
(2) Fidelity Puritan Fund,
(3) Fidelity Spartan U. S. Equity Index Portfolio,
(4) Fidelity Magellan Fund.
(5) Fidelity Contrafund,
(6) Fidelity Equity-Income II Fund,
(7) Warburg Pincus Emerging Growth,
(8) Templeton Foreign,
(9) Fidelity Intermediate Bond Fund,
(10) LG&E Energy Corp. Common Stock Fund, effective January 1,
1998, until December 11, 2000.
(11) Janus Worldwide Fund, effective August 1, 1998.
(12) Powergen Equity Fund, effective December 11, 2000."
2. Section 1.31 shall be amended and replaced in its entirety to read as
follows:
"Section 1.31 LG&E ENERGY CORP. COMMON STOCK FUND means the fund invested
primarily in shares of common stock of LG&E Energy Corp. Effective as soon
as administratively feasible after the closing of the merger between LG&E
Energy Corp. and Powergen plc the fund shall be invested in a short term
investment selected by the Benefits Committee."
3. A new Section 1.59 be added to the end of Article 1 to read as follows:
"Section 1.59 Powergen Equity Fund means the fund invested primarily in
equity securities of Powergen plc, effective December 11, 2000."
IN WITNESS WHEREOF, and as evidence of the adoption of this amendment by the
Sponsor, the undersigned officer being duly authorized has signed this amendment
effective as of the date set forth above.
WKE CORP.
By: ____________________
Duly Authorized
Witness:
By:_____________________
