Exhibit 4.1
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FORT HOWARD CORPORATION
PROFIT SHARING RETIREMENT PLAN
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(As Amended and Restated Effective as of the EFFECTIVE DATE)
(Conformed Copy Through the Ninth Amendment)
TABLE OF CONTENTS
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ARTICLE PAGE
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1 DEFINITIONS 1
2 INTRODUCTION 8
2.01 PURPOSE 9
2.02 RESTATEMENT DATES 9
2.03 PLAN ADMINISTRATION 9
2.04 TRUSTEE, TRUST 9
2.05 SERVICE OF NOTICES 9
3 ELIGIBILITY AND PARTICIPATION 10
3.01 ELIGIBILITY 10
3.02 NOTICE OF PARTICIPATION 10
3.03 TERMINATION OF EMPLOYMENT 10
3.04 DISABILITY 10
3.05 LAYOFF 11
3.06 MILITARY LEAVE 11
3.07 LEAVE OF ABSENCE 11
3.08 FINALITY OF DETERMINATIONS 11
3.09 LEASED EMPLOYEES 11
4 DEFERRED WAGE CONTRIBUTIONS 12
4.01 AMOUNT OF DEFERRED WAGE CONTRIBUTIONS 12
4.02 ADJUSTMENT OF DEFERRED WAGE CONTRIBUTIONS 12
4.03 VESTING OF DEFERRED WAGE CONTRIBUTIONS 14
4.04 PAYROLL DEDUCTIONS 15
4.05 CHANGE IN DEFERRED WAGE CONTRIBUTION RATE 15
4.06 ALLOCATION OF EARNINGS TO DISTRIBUTIONS OF EXCESS
DEFERRALS, EXCESS DEFERRED WAGE CONTRIBUTIONS AND
EXCESS AGGREGATE CONTRIBUTIONS 15
4.07 MULTIPLE USE OF ALTERNATIVE LIMITATION 16
5 ROLLOVER CONTRIBUTIONS 16
5.01 ROLLOVER CONTRIBUTIONS 16
5.02 ROLLOVER CONTRIBUTORS 16
6 COMPANY CONTRIBUTIONS 17
6.01 AMOUNT OF COMPANY CONTRIBUTIONS 17
6.02 PAYMENTS TO TRUST 17
6.03 VERIFICATION OF COMPANY CONTRIBUTIONS 17
6.04 ADJUSTMENT OF COMPANY CONTRIBUTIONS 17
6.05 ACTUAL CONTRIBUTION PERCENTAGE TEST 17
7 ACCOUNTING 18
7.01 ACCOUNTS UNDER THE PLAN 18
7.02 ACCOUNTING PROCEDURES 19
7.03 ALLOCATION OF COMPANY CONTRIBUTIONS AND FORFEITURES 19
7.04 LIMITATIONS ON ADDITIONS TO PARTICIPANTS' ACCOUNTS 20
7.05 INVESTMENT OF CONTRIBUTIONS 20
7.06 INVESTMENT MANAGER 21
(i)
8 VESTING OF ACCOUNTS 21
8.01 VESTING VALUATION 21
8.02 VESTING UPON RETIREMENT OR DEATH 21
8.03 VESTING UPON RESIGNATION/DISMISSAL 22
8.04 REEMPLOYMENT AFTER INCURRING A BREAK IN
SERVICE/RECREDITING OF YEARS OF SERVICE 22
8.05 PARTICIPANTS INCURRING BREAK IN SERVICE PRIOR
TO JANUARY 1, 1985 22
8.06 REEMPLOYMENT AFTER RESIGNATION/DISMISSAL AND
INCURRING A BREAK IN SERVICE 22
8.07 CONDITIONS FOR REPAYMENT OF PRIOR DISTRIBUTION
UPON REEMPLOYMENT 23
8.08 DETERMINATION OF ACCOUNT OF REEMPLOYED
PARTICIPANT WHO HAS NOT INCURRED A BREAK
IN SERVICE 24
8.09 VESTING OF A PARTICIPANT UPON TRANSFER OF
EMPLOYMENT 24
[8.10] STATEMENT OF ACCOUNT 25
9 DISTRIBUTION OF ACCOUNTS 25
9.01 MANNER OF DISTRIBUTION AND FURTHER ADJUSTMENTS 25
9.02 INSERVICE WITHDRAWALS 27
[9.03] REPAYMENTS OF INSERVICE WITHDRAWALS 30
[9.04] DESIGNATION OF BENEFICIARY 31
9.05 MISSING PARTICIPANTS OR BENEFICIARIES 31
9.06 DISTRIBUTION IN COMPANY SECURITIES 32
9.07 ALTERNATE PAYEE DUE TO INCAPACITY 32
9.08 COMMENCEMENT OF DISTRIBUTIONS 32
9.09 DIRECT TRANSFER OF ELIGIBLE ROLLOVER
DISTRIBUTIONS 32
10 MISCELLANEOUS 33
10.01 INFORMATION TO BE FURNISHED BY PARTICIPANTS 33
10.02 INTERESTS NOT TRANSFERABLE 34
10.03 ABSENCE OF GUARANTY 34
10.04 EMPLOYMENT RIGHTS 34
10.05 GENDER AND NUMBER 34
10.06 REVIEW OF BENEFIT DETERMINATIONS 34
10.07 ERISA 35
10.08 UNIFORM ADMINISTRATION 35
10.09 AMENDMENT OR DISCONTINUANCE 36
10.10 PLAN MERGER OR CONSOLIDATION 36
10.11 TRUST AGREEMENT 36
10.12 WISCONSIN LAW TO GOVERN 36
10.13 STOCK RIGHTS OF PARTICIPANTS 37
10.14 NO INTEREST IN COMPANY 38
11 TOP HEAVY RESTRICTIONS 38
11.01 DEFINITIONS 38
11.02 TOP HEAVY DEFINED 39
11.03 VESTING PROCEDURES 40
11.04 MINIMUM BENEFITS FOR NON-KEY EMPLOYEES 41
11.05 MAXIMUM ANNUAL COMPENSATION 42
11.06 FORMULA FOR DETERMINING COMPANY CONTRIBUTIONS 42
11.07 SECTION 416 OF THE CODE AND ITS REGULATIONS 42
11.08 NO DUPLICATION OF BENEFITS 43
(ii)
12 INVESTMENT ADVISORY BOARD 43
12.01 MEMBERSHIP 43
12.02 GENERAL POWERS, RIGHTS AND DUTIES 43
12.03 MANNER OF ACTION 44
12.04 INTERESTED MEMBER 44
12.05 RESIGNATION OR REMOVAL OF MEMBERS 45
12.06 EXPENSES 45
12.07 INFORMATION REQUIRED 45
12.08 UNIFORM RULES 45
12.09 REVIEW OF BENEFIT DETERMINATIONS 46
12.10 FINAL DECISION 46
EXHIBIT A -- FORMULA FOR DETERMINING COMPANY CONTRIBUTIONS UNDER
FORT HOWARD CORPORATION PROFIT SHARING RETIREMENT PLAN A-1
(iii)
FORT HOWARD CORPORATION
PROFIT SHARING RETIREMENT PLAN
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January 1, 1985 Restatement
WHEREAS, the Fort Howard Corporation Profit Sharing Retirement Plan
was amended and restated effective January 1, 1984, for the benefit of
eligible employees of Fort Howard Corporation; and
WHEREAS, it is deemed desirable to amend and restate said Plan in
its entirety;
NOW, THEREFORE, effective as of January 1, 1985 but with respect
only to employees who retire, die or otherwise terminate their employment on
or after said date, said Profit Sharing Retirement Plan hereby is amended and
restated in its entirety in the respects hereinafter set forth. The rights
and obligations of employees who have retired, died or otherwise terminated
their employment prior to January 1, 1985, shall be governed by the terms of
the Plan as in effect on the date of their retirement, death or termination of
employment except as otherwise provided herein.
Article
DEFINITIONS
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The following terms, when used and capitalized herein, are defined as follows
and limited to that meaning only:
1.01 "ACCOUNTING DATE" means any ANNUAL ACCOUNTING DATE or MONTHLY
ACCOUNTING DATE.
1.02 "ACCOUNT" means a COMPANY CONTRIBUTION ACCOUNT, PRIOR PARTICIPANT
ACCOUNT, if any, DEFERRED WAGE ACCOUNT, if any, and any other
account which the TRUSTEE maintains in the name of each PARTICIPANT.
1.03 "ANNUAL ACCOUNTING DATE" means any December 31.
1.04 "ANNUAL BASE PAY" means the total compensation paid to a PARTICIPANT
for services rendered to the COMPANY during a calendar year,
including overtime, holiday pay, sick days, salary continuation, and
vacation pay, but excluding goodwill and discretionary bonuses,
short term disability benefits, suggestion awards, sales awards,
sales incentive compensation, amounts deducted from compensation and
contributed by the PARTICIPANT to any nonqualified supplemental
Retirement Plan and all other special or unusual compensation of
any kind. The amount of ANNUAL BASE PAY shall be determined prior
to any reduction for DEFERRED WAGE CONTRIBUTIONS. In addition,
ANNUAL BASE PAY means, for a PARTICIPANT who was in the employ of a
RELATED CORPORATION, the total compensation paid by such RELATED
CORPORATION as if it were determined under the definition set forth
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above. For PLAN YEARS beginning on and after January 1, 1994, a
PARTICIPANT'S ANNUAL BASE PAY shall not exceed the $150,000
limitation described in Section 401(a)(17) of the CODE, as that
limitation is adjusted from time to time by the Secretary of
Treasury to reflect cost of living increases. In determining the
ANNUAL BASE PAY of a PARTICIPANT, the rules of Section 414(q)(6)
shall apply, except that in applying such rules, the term "family"
shall include only the spouse of the PARTICIPANT and any lineal
descendants of the PARTICIPANT who have not attained age 19 before
the close of the year.
1.05 "BENEFICIARY" means the person(s) or entity(ies) to whom a deceased
PARTICIPANT's benefits are payable, provided, however, in the case
of a deceased PARTICIPANT who was married at the time of his death,
BENEFICIARY shall mean the spouse of such deceased PARTICIPANT
unless such spouse consented in writing to another person(s) or to
other entity(ies) as BENEFICIARY. Such a consent will be effective
only if it acknowledges the specific BENEFICIARY and the effect of
the BENEFICIARY DESIGNATION, is witnessed by a PLAN representative
or a notary public, and may not be changed without further spousal
consent (unless the consent expressly permits subsequent BENEFICIARY
designations without spousal consent).
1.06 "BREAK IN SERVICE" means an interruption in or cessation of
employment with the COMPANY by an EMPLOYEE during any calendar year
in which such EMPLOYEE has completed not more than Five Hundred
(500) HOURS OF SERVICE. In determining whether or not a BREAK IN
SERVICE has occurred or the number of one-year BREAKS IN SERVICE, an
EMPLOYEE who has established that he was absent due to an UNPAID
LEAVE FOR MATERNITY OR CHILD REARING shall not be deemed to have
incurred a BREAK IN SERVICE in the first PLAN YEAR in which he would
have otherwise incurred a BREAK IN SERVICE if he would have been
credited with at least Five Hundred (500) HOURS OF SERVICE under
Section 1.23(iii)(Hours of Service) had he been an EMPLOYEE for such
period.
1.07 "CODE" means the Internal Revenue Code of 1986, as amended.
[1.09] "COMPANY" means Fort Howard Corporation, and whenever the context so
permits, any subsidiary, affiliate corporation or division of
Fort Howard Corporation which is participating in the Plan pursuant
to a resolution of Fort Howard Corporation's Board of Directors and,
when appropriate, of the Board of Directors of such subsidiary or
affiliate corporation.
1.10 "COMPANY CONTRIBUTION" means any contribution made by the COMPANY to
the TRUST (other than DEFERRED WAGE CONTRIBUTIONS) on behalf of each
PARTICIPANT in an amount determined according to the FORMULA.
COMPANY CONTRIBUTIONS shall also include additional amounts, if any,
contributed by the COMPANY to the TRUST out of its current or
accumulated earnings as the Board of Directors of the COMPANY may
determine by resolution adopted before the ANNUAL ACCOUNTING DATE.
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Such COMPANY CONTRIBUTIONS may, in the discretion of the COMPANY, be
made in cash or in COMPANY securities valued at their fair market
value on the ACCOUNTING DATE coincident with or immediately
preceding the date upon which such COMPANY CONTRIBUTIONS are payable
to the TRUST.
1.11 "COMPANY CONTRIBUTION ACCOUNT" means the account maintained for each
PARTICIPANT by the TRUSTEE to reflect the PARTICIPANT'S share of
COMPANY CONTRIBUTIONS and FORFEITURES, and the INVESTMENT EARNINGS
attributable to such items.
1.12 "DEFERRED WAGE ACCOUNT" means the account maintained for each
PARTICIPANT by the TRUSTEE to reflect the DEFERRED WAGE
CONTRIBUTIONS made on behalf of such PARTICIPANT, and the INVESTMENT
EARNINGS attributable to such contributions.
1.13 "DEFERRED WAGE CONTRIBUTION" means the amount which a PARTICIPANT
may elect to have the COMPANY contribute to the TRUST after
January 1, 1984, on his behalf from such PARTICIPANT'S ANNUAL BASE
PAY for the purposes set forth in the PLAN. It is intended that
DEFERRED WAGE CONTRIBUTIONS shall constitute "employer
contributions" for purposes of Section 401(k) of the CODE.
1.14 "DISABILITY" means a disability incurred by an EMPLOYEE which
results in an authorized absence by such EMPLOYEE from work.
1.15 "DISTRIBUTION ACCOUNT" means the account established by the TRUSTEE
for the purpose of maintaining and subsequently distributing the
ACCOUNTS of a PARTICIPANT, including the INVESTMENT EARNINGS
attributable to such ACCOUNTS, upon the termination for any reason
of such PARTICIPANT'S employment with the COMPANY.
1.16 "DISTRIBUTION DATE" means the date upon which ACCOUNT balances are
distributed to a PARTICIPANT, or in the event of the death of such
PARTICIPANT, to the BENEFICIARY of such PARTICIPANT.
1.17 "EFFECTIVE DATE" means January 1, 1985.
1.18 "EMPLOYEE" means any employee of the COMPANY who is eligible to
become a PARTICIPANT under the Plan; provided, however, any person
who is a member of a collective bargaining unit on whose behalf
retirement benefits were the subject of good faith bargaining, shall
not be an EMPLOYEE.
1.19 "ERISA" means the Employee Retirement Income Security Act of 1974,
as amended.
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1.20 "ESOP" means the Fort Howard Corporation Employee Stock Ownership
Plan and Trust.
1.21 "FORFEITURE" means that portion of a PARTICIPANT'S COMPANY
CONTRIBUTION ACCOUNT which is not distributable to such PARTICIPANT
upon RESIGNATION/DISMISSAL in accordance with Section 8.03 (Vesting
Upon Resignation/Dismissal).
1.22 "FORMULA" means the formula set forth in Exhibit A, attached hereto
and incorporated herein by this reference, according to which
COMPANY CONTRIBUTIONS are calculated.
1.23 "HOURS OF SERVICE" as of January 1, 1978, and thereafter, means (a)
each hour for which an EMPLOYEE is directly or indirectly paid or
entitled to payment by the COMPANY for the performance of duties;
(b) each hour for which an EMPLOYEE is directly or indirectly paid
or entitled to payment by the COMPANY although no duties are
performed; and (c) each hour for which back pay, irrespective of
mitigation of damages, is either awarded or agreed to by the COMPANY
with respect to such EMPLOYEE; provided however, that:
(i) an EMPLOYEE who is not paid by the hour shall be credited with
Ten (10) HOURS OF SERVICE for each day for which he would, if
hourly-paid, be credited with an HOUR OF SERVICE pursuant to
the foregoing;
(ii) an EMPLOYEE who is paid by the hour shall be credited with the
number of regularly scheduled working hours (or Eight (8)
HOURS OF SERVICE per day to a maximum Forty (40) HOURS OF
SERVICE per week if he has no regular work schedule) included
in a period of time during which no duties are performed and
for which he is paid or entitled to payment, by the COMPANY;
and
(iii) subject to Sections 3.04, 3.05, 3.06 and 3.07, an EMPLOYEE
shall also be credited with the number of regularly scheduled
working hours to a maximum of Eight (8) HOURS OF SERVICE for
each day (to a maximum Forty (40) HOURS OF SERVICE per week)
that he is absent because of DISABILITY, LAYOFF, LEAVE OF
ABSENCE, or MILITARY LEAVE, and is not otherwise credited with
HOURS OF SERVICE.
1.24 "INCREMENT" means an amount (either positive or negative) determined
as of a current ACCOUNTING DATE by subtracting (1) the fair market
value as of the ACCOUNTING DATE immediately preceding the current
ACCOUNTING DATE of an investment fund within the TRUST FUND
excluding any COMPANY CONTRIBUTIONS, DEFERRED WAGE CONTRIBUTIONS,
PRIOR PARTICIPANT CONTRIBUTIONS or ROLLOVER CONTRIBUTIONS which have
not yet been allocated to the PARTICIPANTS' ACCOUNTS as of such
date; from (2) the fair market value as of the current ACCOUNTING
DATE of the same investment fund within the TRUST FUND excluding any
COMPANY CONTRIBUTIONS, DEFERRED WAGE CONTRIBUTIONS, PRIOR
PARTICIPANT CONTRIBUTIONS or ROLLOVER CONTRIBUTIONS which have not
yet been allocated as of such current ACCOUNTING DATE.
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1.25 "INVESTMENT ADVISORY BOARD" means an investment advisory board
appointed by the Chief Executive Officer of the COMPANY consisting
of such number of persons as determined by the Chief Executive
Officer of the COMPANY, which shall function as the PLAN
ADMINISTRATOR.
1.26 INVESTMENT EARNINGS" means the income, losses, appreciation and
depreciation attributable to ACCOUNTS.
1.27 "INVESTMENT EARNINGS PERCENTAGE" means, as of an ACCOUNTING DATE,
determined separately for each investment fund within the TRUST
FUND, the percentage obtained by dividing (1) the INCREMENT
determined as of such ACCOUNTING DATE by (2) the fair market value
of such investment fund excluding any COMPANY CONTRIBUTIONS,
DEFERRED WAGE CONTRIBUTIONS, PRIOR PARTICIPANT CONTRIBUTIONS and
ROLLOVER CONTRIBUTIONS which were not allocated to the
PARTICIPANTS' ACCOUNTS as of the ACCOUNTING DATE immediately
preceding the ACCOUNTING DATE used to determine the INCREMENT in
the numerator.
1.28 "LAYOFF" means an authorized period during which an EMPLOYEE is laid
off from his job with the COMPANY for a period not exceeding Two (2)
Years on account of a reduction in work force.
1.28A "LEASED EMPLOYEE" means any person who is not an EMPLOYEE of the
COMPANY, but who has provided services to the COMPANY of a type
which have historically (within the business field of the COMPANY)
been provided by EMPLOYEES, on a substantially full-time basis for a
period of at least one year, pursuant to an agreement between the
COMPANY and a leasing organization.
1.29 "LEAVE OF ABSENCE" mans a period of absence from employment granted
by the COMPANY under conditions which are not treated by the COMPANY
as a termination of employment.
1.30 "MILITARY LEAVE" means an authorized leave required by law or
granted by the COMPANY to an EMPLOYEE for the purpose of entering
any one or more of the United States Army, United States Navy,
United States Air Force, United States Coast Guard, United States
Marine Corps, United States Public Health Service or any
governmental service designated by the COMPANY.
1.31 "MONTHLY ACCOUNTING DATE" means the last day of each month which is
not an ANNUAL ACCOUNTING DATE.
1.32 "PARTICIPANT" means each EMPLOYEE who is presently participating in
the PLAN and each former employee and BENEFICIARY for whom an
ACCOUNT is maintained.
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[1.33] "PLAN" means the Fort Howard Corporation Profit Sharing Retirement
Plan.
1.34 "PLAN ADMINISTRATOR" means the "administrator" of the PLAN, for
purposes of Section 3(16)(A) of ERISA.
1.35 "PLAN YEAR" means a calendar year beginning January 1 and ending
December 31.
1.36 "PRIOR PARTICIPANT CONTRIBUTION" means any contribution made by a
PARTICIPANT to the PLAN prior to the January 1, 1984, other than
ROLLOVER CONTRIBUTIONS.
1.37 "PRIOR PARTICIPANT ACCOUNT" means the account maintained for each
PARTICIPANT by the TRUSTEE to reflect the PRIOR PARTICIPANT
CONTRIBUTIONS, if any, and the INVESTMENT EARNINGS attributable to
such contributions.
1.38 "QUALIFIED DOMESTIC RELATIONS ORDER" means a judgment, decree or
order (including approval of a property settlement agreement) which:
(a) relates to the provision of child support, alimony payments,
or marital property rights to a spouse (former spouse), child,
or other dependent of a PARTICIPANT (hereinafter known as
"alternate payee"); and
(b) is made pursuant to a State domestic relations law (including
a community property law); and
(c) creates or recognizes the existence of an alternate payee's
right to, or assigns to an alternate payee the right to
receive all or a portion of the benefits payable to a
PARTICIPANT under the PLAN; and
(d) clearly specifies the name and last known mailing address (if
any) of the PARTICIPANT and the name and mailing address of
each alternate payee covered by the judgment, decree or order
(including approval of a property settlement agreement); and
(e) clearly specifies the amount or percentage of the
PARTICIPANT'S benefits to be paid by the PLAN to each such
alternate payee, or the manner in which such amount or
percentage is to be determined; and
(f) clearly specifies the number of payments or period to which
such order applies; and
(g) clearly specifies that it applies to the PLAN; and
(h) does not require the PLAN to provide any type or form of
benefit, or any option, not otherwise available under the
PLAN; and
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(i) does not require the PLAN to provide increased benefits
(determined on the basis of actuarial value); and
(j) does not require the PLAN to pay benefits to an alternate
payee which are required to be paid to another alternate payee
under another QUALIFIED DOMESTIC RELATIONS ORDER.
1.39 "RELATED CORPORATION" means each corporation, other than the
COMPANY, which is a member of the controlled group of corporations
of which the COMPANY is a member as determined under Section 1563(a)
of the CODE, without regard to Section 1563(a)(4) and Section
1563(e)(3)(C) of the CODE.
1.40 "RESIGNATION/DISMISSAL" means resignation or dismissal from
employment with the COMPANY other than by reason of RETIREMENT or
death.
1.41 "RETIREMENT" means termination of employment with the COMPANY by
reason of (a) attainment of age 55 or older; or (b) a determination
by the COMPANY of a disability retirement.
1.42 "ROLLOVER CONTRIBUTION" means a transfer (including a direct
transfer or direct rollover) to the PLAN within Sixty (60) days
after receipt by the EMPLOYEE of (a) an eligible rollover
distribution described in Section 402(c)(4) of the CODE, or (b) a
rollover contribution described in Section 408(d)(3) of the CODE,
and any investment earnings on such sums.
1.43 "SERVICE UNIT" means a unit which is credited to a PARTICIPANT for
the purpose of determining the portion of COMPANY CONTRIBUTIONS
allocable to such PARTICIPANT'S COMPANY CONTRIBUTION ACCOUNT each
year under Section 7.03 (Allocation of Company Contributions and
Forfeitures). For the purpose of the above-mentioned Section 7.03,
each PARTICIPANT who was in the employ of the COMPANY on
December 31, 1975 shall be credited with the number of SERVICE UNITS
to which he is entitled under the terms of the PLAN as in effect on
December 31, 1975, plus one additional unit for such calendar year
in which he has a YEAR OF SERVICE after such date. Each PARTICIPANT
hired on or after January 1, 1976, shall be entitled to one SERVICE
UNIT for each calendar year in which he has a YEAR OF SERVICE after
January 1, 1976.
1.44 "TRUST" means the Fort Howard Profit Sharing Retirement Master
Trust.
1.45 "TRUST FUND" means the trust fund consisting of all property of any
kind held by the TRUSTEE under the PLAN as of any date.
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1.46 "TRUSTEE" means the trustee of the PLAN which shall manage, hold,
invest and distribute funds contributed under the PLAN pursuant to
the terms of the TRUST.
1.47 "UNPAID LEAVE FOR MATERNITY OR CHILD REARING" means a period of time
following a termination of employment in the event that such
termination of employment was due to one or more of the following
reasons:
(a) pregnancy of the EMPLOYEE
(b) birth of a child of the EMPLOYEE
(c) placement of a child in the home of the EMPLOYEE in connection
with the adoption of such child or
(d) for the purpose of caring for a child for a period beginning
immediately following the birth or placement of such child.
An UNPAID LEAVE FOR MATERNITY OR CHILD REARING must be evidenced by
information reasonably required by the INVESTMENT ADVISORY BOARD to
establish that the reason for the absence was for one of the reasons
stated above.
1.48 "VESTING VALUATION DATE" means the date upon which a PARTICIPANT'S
employment with the COMPANY terminates for any reason, which shall
be the date of the first to occur of the following:
(a) RESIGNATION/DISMISSAL;
(b) RETIREMENT;
(c) death.
The VESTING VALUATION DATE shall be the date upon which YEARS OF
SERVICE are determined for purposes of vesting and distribution of
such PARTICIPANT'S ACCOUNTS.
1.49 "YEAR OF SERVICE" means with respect to an EMPLOYEE each full year
of employment with the COMPANY prior to December 31, 1975 where such
EMPLOYEE received credit under the terms of the PLAN as in effect on
December 31, 1975. Effective January 1, 1976, a YEAR OF SERVICE
means with respect to an EMPLOYEE each calendar year during which
such EMPLOYEE completes One Thousand (1,000) HOURS OF SERVICE. In
addition, a YEAR OF SERVICE shall be credited with respect to an
EMPLOYEE, for each PLAN YEAR during which he completed One Thousand
(1,000) hours of service with a RELATED CORPORATION or the COMPANY.
For purposes of the preceding sentence, "hours of service" shall be
credited as if they were HOURS OF SERVICE performed for the COMPANY.
Article 2
INTRODUCTION
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2.01 PURPOSE
The PLAN is maintained by the COMPANY to enable its EMPLOYEES to
share in the COMPANY'S profits and to provide a means whereby
EMPLOYEES can defer the receipt of otherwise current compensation
and accumulate funds without current taxation to provide for their
future security. The PLAN is intended to be a qualified profit
sharing plan under Section 401(a) and a qualified cash or deferred
arrangement under Section 401(k) of the CODE.
2.02 RESTATEMENT DATES
The PLAN was established as of January 1, 1951. The PLAN was
amended and restated to comply with ERISA, effective January 1,
1976. The PLAN has since been amended from time to time either by
restatement or amendment and is hereby further amended and restated,
effective as of the January 1, 1985.
2.03 PLAN ADMINISTRATION
The INVESTMENT ADVISORY BOARD shall be responsible for carrying out
those duties and responsibilities imposed upon (a) the PLAN
ADMINISTRATOR by ERISA; and (b) the INVESTMENT ADVISORY BOARD by the
PLAN and the TRUST. The INVESTMENT ADVISORY BOARD shall have the
discretionary authority to determine all questions arising under the
PLAN, including the power to determine the rights or eligibility of
EMPLOYEES or PARTICIPANTS and any other persons, and the amounts of
their benefits under the PLAN, and to remedy ambiguities,
inconsistencies or omissions. The INVESTMENT ADVISORY BOARD from
time to time may adopt such rules and regulations as may be
necessary or desirable for the proper and efficient administration
of the PLAN and as are consistent with the terms of the PLAN. The
COMPANY may, in writing signed by its Chief Executive Officer,
delegate specific powers or duties relating to the operation of the
PLAN to such persons as such Chief Executive Officer may deem
appropriate, except any powers or duties which are reserved to the
Board of Directors of the COMPANY by the terms of the PLAN or the
TRUST.
2.04 TRUSTEE, TRUST
Funds contributed to the PLAN shall be managed, held, invested and
distributed by the TRUSTEE, or by an investment manager(s), in
accordance with the TRUST, which shall implement the PLAN.
2.05 SERVICE OF NOTICES
Any notice or document required to be given to or filed with the
INVESTMENT ADVISORY BOARD shall be deemed properly given or filed if
delivered or mailed by registered mail, postage prepaid, to the
INVESTMENT ADVISORY BOARD, in care of the COMPANY.
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Article 3
ELIGIBILITY AND PARTICIPATION
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3.01 ELIGIBILITY
Each EMPLOYEE who was a PARTICIPANT on December 31, 1984, shall
remain a PARTICIPANT. Each EMPLOYEE who was not a PARTICIPANT on
December 31, 1984, shall become a PARTICIPANT on the first to occur
of the following:
(a) any June 30 or December 31 which next follows the first
anniversary of his date of hire if he has completed One
Thousand (1,000) HOURS OF SERVICE during the Twelve (12) month
period ending on the first anniversary of his date of hire;
or
(b) any December 31 which next follows the first anniversary of
his date of hire if he completes a YEAR OF SERVICE during the
calendar year ending on such December 31.
3.02 NOTICE OF PARTICIPATION
The INVESTMENT ADVISORY BOARD shall notify each EMPLOYEE of the date
on which he shall become a PARTICIPANT, as early as practicable
prior to such date.
3.03 TERMINATION OF EMPLOYMENT
If the employment of an EMPLOYEE who is a PARTICIPANT is terminated
for any reason, such EMPLOYEE shall thereupon cease to be a
PARTICIPANT except to the extent of any ACCOUNTS to which he may be
entitled because of his prior participation in the PLAN. If such
PARTICIPANT is subsequently reemployed by the COMPANY, he shall
again enter the PLAN as of the date of his reemployment and may
begin making DEFERRED WAGE CONTRIBUTIONS in accordance with Section
4.01 (Amount of Deferred Wage Contributions).
3.04 DISABILITY
DISABILITY of an EMPLOYEE (whether or not he is a PARTICIPANT) shall
not interrupt continuity of service or participation for purposes of
the PLAN. Such EMPLOYEE shall be credited with HOURS OF SERVICE for
any period during which he is absent because of such DISABILITY.
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3.05 LAYOFF
LAYOFF of an EMPLOYEE (whether or not he is a PARTICIPANT) shall
not interrupt continuity of service or participation for purposes
of the PLAN. Such EMPLOYEE shall be credited with HOURS OF SERVICE
for such LAYOFF. If such EMPLOYEE on LAYOFF is not called back to
work by the COMPANY within two years after such LAYOFF began, he
shall cease to receive credit for HOURS OF SERVICE after such
two-year period.
3.06 MILITARY LEAVE
MILITARY LEAVE by an EMPLOYEE (whether or not he is a PARTICIPANT)
shall not interrupt continuity of service or participation for
purposes of the PLAN. Such EMPLOYEE shall be credited with HOURS OF
SERVICE for any such period of MILITARY LEAVE.
3.07 LEAVE OF ABSENCE
A LEAVE OF ABSENCE shall not interrupt continuity of service or
participation for purposes of the PLAN; provided, however, that an
EMPLOYEE (whether or not he is a PARTICIPANT) shall not receive
credit for HOURS OF SERVICE for any portion of a LEAVE OF ABSENCE
which exceeds one year.
3.08 FINALITY OF DETERMINATIONS
All determinations with respect to the crediting of YEARS OF SERVICE
under the PLAN shall be made on the basis of the records of the
COMPANY or a RELATED CORPORATION, and all determinations so made
shall be final and conclusive upon EMPLOYEES, former EMPLOYEES, and
all other persons claiming a benefit interest under the PLAN.
Notwithstanding anything to the contrary contained in the PLAN,
there shall be no duplication of YEARS OF SERVICE credited to an
EMPLOYEE, for any one period of his employment with the COMPANY or a
RELATED CORPORATION.
3.09 LEASED EMPLOYEES
A LEASED EMPLOYEE shall not be eligible to participate in the PLAN.
If a LEASED EMPLOYEE subsequently becomes an EMPLOYEE of the
COMPANY, the period during which a LEASED EMPLOYEE performs services
for the COMPANY shall be taken into account for purposes of Sections
3.01 and 8.01 of the Plan; unless (i) such LEASED EMPLOYEE is a
participant in a money purchase pension plan maintained by the
leasing organization which provides a non-integrated employer
contribution rate of at least 10 percent of compensation, immediate
participation for all employees and full and immediate vesting, and
(ii) LEASED EMPLOYEES do not constitute more than 20 percent of the
COMPANY's nonhighly compensated workforce.
- 11 -
Article 4
DEFERRED WAGE CONTRIBUTIONS
---------------------------
4.01 AMOUNT OF DEFERRED WAGE CONTRIBUTIONS
Each PARTICIPANT who is an EMPLOYEE may, as of the EFFECTIVE DATE,
elect to have the COMPANY make DEFERRED WAGE CONTRIBUTIONS on his
behalf by filing a written election form with the INVESTMENT
ADVISORY BOARD by such date as the INVESTMENT ADVISORY BOARD shall
determine, specifying in such election the amount, which shall be
not less than One percent (1%) nor more than Eight percent (8%) of
his ANNUAL BASE PAY, of DEFERRED WAGE CONTRIBUTIONS which the
PARTICIPANT desires to have subtracted from his current compensation
from the COMPANY and contributed to the TRUSTEE on his behalf. Any
PARTICIPANT who is absent because of DISABILITY, is on LEAVE OF
ABSENCE, LAYOFF, or MILITARY LEAVE or whose employment terminates
and is subsequently reinstated, may make such election provided by
this Section by filing a written election form with the INVESTMENT
ADVISORY BOARD by such date as the INVESTMENT ADVISORY BOARD shall
determine. Any other EMPLOYEE may make such election by filing a
written election form with the INVESTMENT ADVISORY BOARD by such
date as the INVESTMENT ADVISORY BOARD shall determine. The maximum
amount which any PARTICIPANT shall defer in any one PLAN YEAR is
$7,000. This dollar maximum amount shall increase pursuant to the
cost of living allowance as prescribed by the Secretary of the
Treasury. In the event that a PARTICIPANT defers more than the
dollar maximum specified above ("excess deferrals"), he shall
receive the excess deferrals in cash. The INVESTMENT ADVISORY BOARD
shall direct the TRUSTEE to distribute to the PARTICIPANT, prior to
the April 15 following the end of the PLAN YEAR in which the excess
deferrals occurred, the PARTICIPANT's excess deferrals (along with
any income attributable thereto as determined under Section 4.06, if
any).
4.02 ADJUSTMENT OF DEFERRED WAGE CONTRIBUTIONS
(a) For any PLAN YEAR the actual deferral percentage for the
highly compensated employees as defined in paragraph (b) shall
not exceed the greater of (i) or (ii) as follows:
(i) The actual deferral percentage for the eligible
employees who are not highly compensated employees as
defined in paragraph (b) of this Section, times 1.25,
or
(ii) The actual deferral percentage for the eligible
employees who are not highly compensated employees as
defined in paragraph (b) of this Section, times 2.0;
provided, however, that the actual deferral percentage
for the highly compensated employees as defined in
paragraph (b) of this Section may not exceed the actual
deferral percentage for the eligible employees who are
not highly compensated as defined in paragraph (b) of
this Section, by more than two percentage points.
- 12 -
The actual deferral percentage for a specified group of
employees for a PLAN YEAR shall be the average of the ratios
(calculated separately for each employee in such group) of:
(A) The amount of DEFERRED WAGE CONTRIBUTIONS actually paid
to the PLAN on behalf of each such employee for such
PLAN YEAR, to
(B) The employee's compensation for such PLAN YEAR. An
employee's compensation shall be the total amount of
compensation paid to said employee by the COMPANY
determined in accordance with Internal Revenue Code
Reg. Sec. 1.415(2)(d)(1) and (2) (hereafter
"COMPENSATION").
The INVESTMENT ADVISORY BOARD shall determine, from time to
time, from the elections of DEFERRED WAGE CONTRIBUTIONS then
on file with the INVESTMENT ADVISORY BOARD, whether the
foregoing limitations will be satisfied and, to the extent
necessary to ensure compliance with such limitations, may
reduce, on a pro rata basis, the applicable percentages of
ANNUAL BASE PAY to be withheld for the highly compensated
employees for the next quarter or pay period. If at the end
of any PLAN YEAR, because of the foregoing limitations, a
portion of the DEFERRED WAGE CONTRIBUTIONS withheld from a
PARTICIPANT's current compensation cannot be credited to his
DEFERRED WAGE ACCOUNT ("excess deferred wage contributions"),
such contributions shall be treated as additional earnings of
the PARTICIPANT and, if already contributed to the TRUSTEE,
shall be returned to the PARTICIPANT (along with any income
attributable thereto as determined under Section 4.06, if any)
within two and one-half months after the end of that PLAN
YEAR. If adjustments are necessary to comply with the actual
deferral percentage tests, excess deferred wage contributions
of highly compensated employees shall be reduced in the order
of their average deferral percentages, beginning with the
highest percentage.
(b) The term "highly compensated employees" shall mean all
eligible employees who are:
(i) 5% or more stockholders (or is considered as owning 5%
or more of the stock within the meaning of Section 318
of the CODE) of the COMPANY or a RELATED CORPORATION
during the PLAN YEAR; or
(ii) EMPLOYEES of the COMPANY or a RELATED CORPORATION whose
COMPENSATION is in excess of $75,000 (or such greater
amount as may be determined by the Commissioner of
Internal Revenue); or
(iii) EMPLOYEES of the COMPANY or a RELATED CORPORATION whose
COMPENSATION is in excess of $50,000 (or such greater
amount as may be determined by the Commissioner of
Internal Revenue) and is included in a group consisting
of the top 20% of the eligible employees when ranked on
the basis of COMPENSATION paid during such year; or
- 13 -
(iv) Officers of the COMPANY or RELATED CORPORATION at any
time and received COMPENSATION greater than 50% of the
amount in effect under Section 415(b)(1)(A) of the
CODE; provided, however, that no more than 50 of said
officers shall be considered in this category.
In the case of the PLAN YEAR for which the determination of
"highly compensated employees" is being determined, an
eligible employee not described in subparagraphs (ii), (iii),
and (iv) of paragraph (b) herein for the preceding PLAN YEAR
(without regard to this paragraph) shall not be treated as
described in said subparagraphs (ii), (iii), and (iv) unless
such eligible employee is a member of the group consisting of
the 100 employees paid the greatest COMPENSATION during the
PLAN YEAR that such determination is being made. The term
"highly compensated employees" shall also include any highly
compensated former employee who separated from service (or was
deemed to have separated) prior to the determination year,
performs no services for the COMPANY or a RELATED CORPORATION
during the determination year and was a highly compensated
employee for either the separation year or any determination
year ending on or after the employee's 55th birthday.
(c) For purposes of Sections 4.02(a) and 6.05, the following
family aggregation rules shall apply:
(i) Family members (i.e., the employee's spouse, lineal
descendants and ascendants, and the spouses of such
lineal descendants and ascendants) of a PARTICIPANT who
is a five percent owner or one of the 10 highly
compensated employees paid the greatest total
compensation with respect to any PLAN YEAR, shall not
be treated as separate PARTICIPANTS and a single actual
deferral percentage under Section 402(a) and a single
actual contribution percentage under Section 6.05
shall be determined for the family members and the
highly compensated employee ("family group"). The
family group shall be treated as a single highly
compensated employee having an actual deferral
percentage and an actual contribution percentage based
on the combined COMPENSATION and applicable DEFERRED
WAGE CONTRIBUTIONS or COMPANY CONTRIBUTIONS of all
members of the family group.
(ii) If a family group has excess DEFERRED WAGE
CONTRIBUTIONS or COMPANY CONTRIBUTIONS, the excess
amount resulting from the required reduction described
in (i) above shall be allocated among all members of
the family group in proportion to their respective
contributions.
4.03 VESTING OF DEFERRED WAGE CONTRIBUTIONS
Any and all amounts in the DEFERRED WAGE CONTRIBUTION ACCOUNT of a
PARTICIPANT shall be One Hundred Percent (100%) vested and
non-forfeitable at all times.
- 14 -
4.04 PAYROLL DEDUCTIONS
Any DEFERRED WAGE CONTRIBUTIONS made on behalf of a PARTICIPANT
shall be deducted from his ANNUAL BASE PAY at the time of payment of
the same by the COMPANY and shall be paid to the TRUSTEE as soon as
reasonably practicable thereafter. If a PARTICIPANT'S employment
with the COMPANY is terminated for any reason, any portion of such
contributions not yet paid to the TRUSTEE shall be paid to the
TRUSTEE by the COMPANY, whereupon the TRUSTEE shall pay such portion
to such PARTICIPANT in accordance with Article 9 (Distribution of
Accounts).
4.05 CHANGE IN DEFERRED WAGE CONTRIBUTION RATE
A PARTICIPANT who is an EMPLOYEE may, by written election filed with
the INVESTMENT ADVISORY BOARD in accordance with such procedures as
it shall determine:
(a) make an initial election to have DEFERRED WAGE CONTRIBUTIONS
made on his behalf;
(b) elect to change the amount of his DEFERRED WAGE CONTRIBUTIONS
within the limits specified in Sections 4.01 (Amount of
Deferred Wage Contributions) and 4.02 (Adjustment of Deferred
Wage Contributions);
(c) elect to stop DEFERRED WAGE CONTRIBUTIONS; or
(d) having stopped DEFERRED WAGE CONTRIBUTIONS in accordance with
this Section 4.05, again elect to have such contributions made
on his behalf within the election percentage limitations
specified in the above-mentioned Section 4.01 and the general
limitations of the above-mentioned Section 4.02.
Any of the above-specified elections shall be effective as of the
first pay period for which compensation is received in the month
next following the date an election is approved by the INVESTMENT
ADVISORY BOARD.
4.06 ALLOCATION OF EARNINGS TO DISTRIBUTIONS OF EXCESS DEFERRALS, EXCESS
DEFERRED WAGE CONTRIBUTIONS AND EXCESS AGGREGATE CONTRIBUTIONS
The earnings allocable to distributions of excess deferrals, excess
deferred wage contributions and excess aggregate contributions
required under Sections 4.01, 4.02 and 6.05 shall be determined by
multiplying the earnings attributable to the PARTICIPANT's DEFERRED
WAGE CONTRIBUTIONS for the PLAN YEAR or to the COMPANY CONTRIBUTIONS
allocated under Section 7.03(a) of the PLAN, as the case may be, by
a fraction, the numerator of which is the applicable excess amount,
and the denominator of which is the balance in the PARTICIPANT's
applicable ACCOUNT or ACCOUNTS on the last day of such year reduced
by gains (or increased by losses) attributable to such ACCOUNT or
ACCOUNTS during that year. The earnings attributable to such excess
deferrals, excess deferred wage contributions and excess aggregate
contributions determined in accordance with the preceding sentence
shall be increased to reflect the earnings to the date of
- 15 -
distribution by an amount equal to ten percent of the earnings
determined in accordance with the preceding sentence multiplied by
the number of calendar months that have elapsed since the end of the
applicable year. For purposes of the foregoing, a distribution
occurring on or before the fifteenth day of the month will be
treated as having been made on the last day of the preceding month,
and a distribution occurring after such fifteenth day will be
treated as having been made on the first day of the next subsequent
month.
4.07 MULTIPLE USE OF ALTERNATIVE LIMITATION
In accordance with Treasury Regulation Section 1.401(m)-2 and
Revenue Procedure 89-65, multiple use of the alternative limitation
which occurs as a result of testing under the limitations described
in Sections 4.02 and 6.05 will be corrected in the manner described
in Treasury Regulation Section 1.401(m)-1(e). The term "alternative
limitation" as used above means the alternative methods of
compliance with Sections 401(k) and 401(m) of the Internal Revenue
Code contained in Sections 401(k)(3)(A) (ii)(II) and
401(m)(2)(A)(ii) thereof, respectively.
Article 5
ROLLOVER CONTRIBUTIONS
----------------------
5.01 ROLLOVER CONTRIBUTIONS
Each PARTICIPANT, and each other EMPLOYEE who would be eligible to
participate but for his failure to satisfy the service requirement
of Section 3.01 (Eligibility), may apply in writing to the
INVESTMENT ADVISORY BOARD on the form provided for that purpose to
make a ROLLOVER CONTRIBUTION to the PLAN. Upon approval by the
INVESTMENT ADVISORY BOARD, the ROLLOVER CONTRIBUTION shall be
deposited in the TRUST FUND and credited to such PARTICIPANT'S PRIOR
PARTICIPANT ACCOUNT and maintained by the TRUSTEE as a subaccount of
such PRIOR PARTICIPANT ACCOUNT.
5.02 ROLLOVER CONTRIBUTORS
An EMPLOYEE who makes a ROLLOVER CONTRIBUTION to the PLAN as
provided in Section 5.01 above before becoming a PARTICIPANT
pursuant to the above-said Section 3.01 shall be deemed to be a
PARTICIPANT as of the date of such ROLLOVER CONTRIBUTION solely for
the purpose of maintaining such EMPLOYEE'S PRIOR PARTICIPANT
ACCOUNT. Such EMPLOYEE shall not receive an allocation of COMPANY
CONTRIBUTIONS or FORFEITURES or be entitled to elect to have
DEFERRED WAGE CONTRIBUTIONS made on his behalf or have any other
interest under this PLAN until he satisfies the requirements of the
above-said Section 3.01.
- 16 -
Article 6
COMPANY CONTRIBUTIONS
---------------------
6.01 AMOUNT OF COMPANY CONTRIBUTIONS
The COMPANY shall contribute to the TRUST on behalf of each
PARTICIPANT an amount determined according to the FORMULA, and, in
addition to the amount, if any, determined by application of the
FORMULA, the COMPANY, at its option, may contribute to the TRUST
such additional and discretionary amounts as the Board of Directors
of the COMPANY shall determine by resolution.
6.02 PAYMENTS TO TRUST
COMPANY CONTRIBUTIONS shall be paid to the TRUST without interest.
6.03 VERIFICATION OF COMPANY CONTRIBUTIONS
The certificate of a certified public accountant selected by the
COMPANY as to the correctness of any amount or calculation of
COMPANY CONTRIBUTIONS under the FORMULA or any resolution of the
COMPANY'S Board of Directors pertaining thereto shall be conclusive
on all persons.
6.04 ADJUSTMENT OF COMPANY CONTRIBUTIONS
COMPANY CONTRIBUTIONS made on behalf of any PARTICIPANT may, in the
discretion of the INVESTMENT ADVISORY BOARD, be retroactively or
prospectively adjusted to bring the PLAN into compliance with (a)
the participation and discrimination standards contained in Section
401(k) of the CODE, and (b) the "top-heavy plan" provisions of
Section 416(g) of the CODE.
6.05 ACTUAL CONTRIBUTION PERCENTAGE TEST
(a) For any PLAN YEAR the actual contribution percentage for the
highly compensated employees as defined in Section 4.02(b)
shall not exceed the greater of (i) or (ii) as follows:
(i) The actual contribution percentage for the eligible
employees who are not highly compensated employees as
defined in Section 4.02(b), times 1.25, or
(ii) The actual contribution percentage for the eligible
employees who are not highly compensated employees as
defined in Section 4.02(b), times 2.0; provided,
however, that the actual contribution percentage for
the highly compensated employees as defined in Section
4.02(b) may not exceed the actual contribution
percentage for the eligible employees who are not
- 17 -
highly compensated as defined in Section 4.02(b) by
more than two percentage points.
(b) The actual contribution percentage for a specified group of
employees for a PLAN YEAR shall be the average of the ratios
(calculated separately for each employee in such group) of:
(i) The amount of COMPANY CONTRIBUTIONS allocated to the
COMPANY CONTRIBUTION ACCOUNT of each such employee
under Section 7.03(a) of the PLAN for such PLAN YEAR,
to
(ii) The employee's compensation for such PLAN YEAR. An
employee's compensation shall be the total amount of
compensation paid to said employee by the COMPANY
determined in accordance with Internal Revenue Code
Reg. Sec. 1.415(2)(d)(1) and (2).
(c) If adjustments are necessary to comply with the actual
contribution percentage tests described above, excess COMPANY
CONTRIBUTIONS of highly compensated employees shall be reduced
in the order of their average contribution percentages,
beginning with the highest percentage. Any COMPANY
CONTRIBUTION allocated under Section 7.03(a) of the PLAN which
cannot be credited to a PARTICIPANT's COMPANY CONTRIBUTION
ACCOUNT because of the limitations described above or which is
attributable to the portion, if any, of a PARTICIPANT's excess
DEFERRED WAGE CONTRIBUTIONS determined in accordance with
Section 4.01 or 4.02 ("excess aggregate contributions") shall
not be credited to the PARTICIPANT's COMPANY CONTRIBUTION
ACCOUNT but instead shall be distributed to the PARTICIPANT,
along with the earnings applicable thereto, within two and
one-half months after the close of the PLAN YEAR for which the
amounts are in excess.
Article 7
ACCOUNTING
----------
7.01 ACCOUNTS UNDER THE PLAN
For periods beginning on or after the EFFECTIVE DATE, the TRUSTEE
shall maintain (a) a COMPANY CONTRIBUTION ACCOUNT in the name of
each PARTICIPANT, (b) a PRIOR PARTICIPANT ACCOUNT in the name of
each PARTICIPANT who made PRIOR PARTICIPANT CONTRIBUTIONS to the
PLAN prior to January 1, 1984, and each EMPLOYEE who has received
INVESTMENT ADVISORY BOARD approval to make a ROLLOVER CONTRIBUTION
to the PLAN, and (c) a DEFERRED WAGE ACCOUNT in the name of each
PARTICIPANT who elects to have DEFERRED WAGE CONTRIBUTIONS made on
his behalf.
The TRUSTEE also may maintain such other accounts in the names of
EMPLOYEES or PARTICIPANTS, or otherwise, as the TRUSTEE considers
necessary or desirable.
- 18 -
7.02 ACCOUNTING PROCEDURES
As of each MONTHLY ACCOUNTING DATE and ANNUAL ACCOUNTING DATE, the
INVESTMENT ADVISORY BOARD shall direct the TRUSTEE and/or investment
manager(s) to implement such accounting procedures with respect to
each of the ACCOUNTS under the PLAN as are necessary to administer
the PLAN in a uniform and nondiscriminatory manner consistent with
ERISA or other applicable laws. The TRUSTEE shall adjust the
ACCOUNTS of each PARTICIPANT (and the account which holds
unallocated FORFEITURES) on an ACCOUNTING DATE as follows:
(a) First, reduce a DISTRIBUTION ACCOUNT as outlined in Section
9.01 (Manner of Distribution and Further Adjustments) by an
amount equal to all payments and distributions made from such
DISTRIBUTION ACCOUNT to the extent that such DISTRIBUTION
ACCOUNT has not already been reduced to reflect such payment
and distributions or reduce a DEFERRED WAGE ACCOUNT or a PRIOR
PARTICIPANT ACCOUNT by any inservice withdrawal as outlined in
Section 9.02 (Inservice Withdrawals) to the extent that such
ACCOUNTS(S) has not been reduced to reflect such distribution;
(b) Second, increase or decrease each ACCOUNT (including the
account which holds unallocated FORFEITURES) within each
investment fund within the TRUST FUND by an amount equal to
the product of (i) the applicable INVESTMENT EARNINGS
PERCENTAGE and (ii) the balance of such ACCOUNT as of the
preceding ACCOUNTING DATE minus any distributions made since
the last ACCOUNTING DATE as described in subparagraph (a) of
this Section 7.02;
(c) Third, allocate and credit to PARTICIPANTS' COMPANY
CONTRIBUTION ACCOUNTS any COMPANY CONTRIBUTION and FORFEITURES
that are to be credited in accordance with Section 7.03
(Allocation of Company Contribution and Forfeitures) which
have been made to the TRUST FUND and not previously allocated;
and
(d) Fourth, credit to the PARTICIPANTS' DEFERRED WAGE ACCOUNTS any
DEFERRED WAGE CONTRIBUTIONS or to the PARTICIPANTS' PRIOR
PARTICIPANT ACCOUNT any ROLLOVER CONTRIBUTIONS which have not
been previously credited on the last preceding ACCOUNTING
DATE.
7.03 ALLOCATION OF COMPANY CONTRIBUTIONS AND FORFEITURES
Subject to the limitations of Section 7.04 (Limitations on Additions
to Participants' Accounts), as of each ANNUAL ACCOUNTING DATE, the
COMPANY CONTRIBUTION for the year ending on such date shall be
allocated and credited to the COMPANY CONTRIBUTION ACCOUNTS of
PARTICIPANTS employed by the Company during such year as follows:
(a) Fifty percent (50%) of the COMPANY CONTRIBUTIONS shall be
allocated to the COMPANY CONTRIBUTION ACCOUNTS of such
PARTICIPANTS, pro rata, according to the DEFERRED WAGE
CONTRIBUTIONS made on behalf of each of them during such year;
- 19 -
(b) Twenty-five percent (25%) of the COMPANY CONTRIBUTIONS shall
be allocated to the COMPANY CONTRIBUTION ACCOUNTS of such
PARTICIPANTS, pro rata, according to the ANNUAL BASE PAY of
each of them during such year; and
(c) Twenty-five percent (25%) of the COMPANY CONTRIBUTIONS shall
be allocated to the COMPANY CONTRIBUTION ACCOUNTS of such
PARTICIPANTS, pro rata, according to the number of SERVICE
UNITS allocated to each of them for such year.
However, no such allocations shall be made on behalf of PARTICIPANTS
whose VESTING VALUATION DATES occur during such year because of
RESIGNATION/DISMISSAL.
All FORFEITURES of prior PARTICIPANTS which have not been recredited
in accordance with either Section 8.06 (Reemployment After
Resignation/Dismissal and Incurring a Break in Service), or Section
8.08 (Determination of Account of Reemployed Participant Who Has Not
Incurred a Break in Service), including the INVESTMENT EARNINGS
thereon, shall be allocated and credited as of each ANNUAL
ACCOUNTING DATE to the COMPANY CONTRIBUTION ACCOUNTS of PARTICIPANTS
who were employed by the COMPANY during such year according to the
formula set forth in this Section 7.03 for the allocation of COMPANY
CONTRIBUTIONS.
7.04 LIMITATIONS ON ADDITIONS TO PARTICIPANTS' ACCOUNTS
The total amount of COMPANY CONTRIBUTIONS, FORFEITURES, and DEFERRED
WAGE CONTRIBUTIONS that may be credited in any calendar year to the
accounts of a PARTICIPANT hereunder shall not exceed the lesser of
(a) $30,000 (as adjusted for cost-of-living increases pursuant to
Section 415 of the CODE); or (b) Twenty-five percent (25%) of such
PARTICIPANT'S total compensation from the COMPANY for such year (as
stated on such PARTICIPANT'S Wage and Tax Statement [Form W-2]).
Any COMPANY CONTRIBUTIONS or FORFEITURES which cannot be credited to
a PARTICIPANT'S COMPANY CONTRIBUTION ACCOUNT because of the
limitations set forth above shall be allocated among the remaining
PARTICIPANTS in accordance with Section 7.03 (Allocation of Company
Contributions and Forfeitures).
7.05 INVESTMENT OF CONTRIBUTIONS
Contributions made to the PLAN by or on behalf of a PARTICIPANT
shall be invested in such investment fund or funds, or any of them,
and in such amounts as determined by the INVESTMENT ADVISORY BOARD
in its sole discretion. The INVESTMENT ADVISORY BOARD may also
permit the PARTICIPANT to direct the manner in which the
PARTICIPANT'S ACCOUNT balances are to be invested in part or in
whole in accordance with such uniform and nondiscriminatory rules
and procedures as the INVESTMENT ADVISORY BOARD may adopt for such
purposes.
- 20 -
7.06 INVESTMENT MANAGER
The INVESTMENT ADVISORY BOARD may appoint one or more investment
managers to have the unlimited or limited authority and power to
manage, acquire or dispose of the assets in any investment fund.
Each investment manager shall be registered as an investment adviser
under the Investment Advisers Act of 1940, a bank as defined in that
Act, or an insurance company qualified to perform such services
under the laws of more than one state, and shall acknowledge in
writing to be a fiduciary with respect to the PLAN and the TRUST.
Article 8
VESTING OF ACCOUNTS
-------------------
8.01 VESTING VALUATION
Amounts in the DEFERRED WAGE ACCOUNT and PRIOR PARTICIPANT ACCOUNT
of a PARTICIPANT are fully vested and not subject to forfeiture.
Amounts in the COMPANY CONTRIBUTION ACCOUNT of a PARTICIPANT who is
an EMPLOYEE shall vest as follows:
Years of Service Percentage Vested
Less than 3 0%
3 20%
4 40%
5 60%
6 80%
7 100%
With respect to any EMPLOYEE who was a PARTICIPANT in the PLAN on or
before December 31, 1988, the vested portion of such PARTICIPANT'S
COMPANY CONTRIBUTION ACCOUNT shall not be less than the vested
portion of such ACCOUNT as determined in accordance with the vesting
schedule provided by this Section and in effect on December 31,
1988.
Distribution of amounts so vested shall be accomplished in
accordance with Article 9 (Distribution of Accounts).
The vesting percentage of a PARTICIPANT whose COMPANY CONTRIBUTION
ACCOUNT is not fully vested on the date of his termination of
employment with the COMPANY for any reason shall be determined on
the VESTING VALUATION DATE.
8.02 VESTING UPON RETIREMENT OR DEATH
If a PARTICIPANT'S employment with the COMPANY is terminated because
of RETIREMENT or death, his COMPANY CONTRIBUTION ACCOUNT shall
become nonforfeitable as of his VESTING VALUATION DATE.
- 21 -
The amount of such PARTICIPANT'S COMPANY CONTRIBUTION ACCOUNT,
DEFERRED WAGE ACCOUNT and PRIOR PARTICIPANT ACCOUNT shall be
determined as of the ACCOUNTING DATE immediately preceding his
distribution date in accordance with Section 9.01 (Manner of
Distribution and Further Adjustments).
8.03 VESTING UPON RESIGNATION/DISMISSAL
If a PARTICIPANT'S employment with the COMPANY is terminated because
of RESIGNATION/DISMISSAL, his DEFERRED WAGE ACCOUNT and PRIOR
PARTICIPANT ACCOUNT balances are fully vested and not subject to
forfeiture and his COMPANY CONTRIBUTION ACCOUNT, shall become vested
in accordance with Paragraph 8.01 herein.
The amount of such ACCOUNTS shall be determined as of the ACCOUNTING
DATE immediately preceding his DISTRIBUTION DATE in accordance with
Section 9.01 (Manner of Distribution and Further Adjustments).
8.04 REEMPLOYMENT AFTER INCURRING A BREAK IN SERVICE/RECREDITING OF YEARS
OF SERVICE
YEARS OF SERVICE in respect of a PARTICIPANT whose employment with
the COMPANY terminated after December 31, 1975, and who is
reemployed by the COMPANY after incurring a BREAK IN SERVICE, shall
not include YEARS OF SERVICE credited prior to such BREAK IN SERVICE
until such PARTICIPANT is credited with a YEAR OF SERVICE following
his reemployment. Additionally, an EMPLOYEE whose service was
terminated on or prior to December 31, 1975, and who is subsequently
reemployed by the COMPANY shall not be recredited with YEARS OF
SERVICE prior to such termination.
8.05 PARTICIPANTS INCURRING BREAK IN SERVICE PRIOR TO JANUARY 1, 1985
A former PARTICIPANT who is reemployed by the COMPANY who had
incurred a one year BREAK IN SERVICE prior to January 1, 1985, will
have permanently forfeited any FORFEITURES which arose due to a
previous RESIGNATION/DISMISSAL.
8.06 REEMPLOYMENT AFTER RESIGNATION/DISMISSAL AND INCURRING A BREAK IN
SERVICE
(a) A former PARTICIPANT who did not incur a one year BREAK IN
SERVICE and is reemployed by the COMPANY, shall have credited
to his COMPANY CONTRIBUTION ACCOUNT, an amount equal to such
PARTICIPANT'S FORFEITURE, if any, at the time of such prior
RESIGNATION/DISMISSAL. Such amount shall be subtracted from
the balance of FORFEITURES in the PLAN on the ACCOUNTING DATE
next following such PARTICIPANT'S reemployment and credited to
his COMPANY CONTRIBUTION ACCOUNT. Upon a subsequent
RESIGNATION/DISMISSAL, such PARTICIPANT shall receive the
amount which represents the vested portion of his COMPANY
CONTRIBUTION based upon the provisions of Section 8.08
(Determination of Account of Reemployed Participant Who Has
- 22 -
Not Incurred a One-Year Break In Service). Such former
PARTICIPANT shall not be required to make a repayment but may
do so if he so elects.
(b) In the event a former PARTICIPANT who has received a
distribution of his vested COMPANY CONTRIBUTION ACCOUNT or his
DEFERRED WAGE ACCOUNT due to his RESIGNATION/DISMISSAL (which
RESIGNATION/ DISMISSAL occurred on or after January 1, 1985,
or during calendar year 1984 such that there was no BREAK IN
SERVICE on January 1, 1985) is reemployed by the COMPANY
before he has incurred five (5) consecutive one-year BREAKS IN
SERVICE, his COMPANY CONTRIBUTION ACCOUNT shall be credited
with the amount he forfeited, if any, at the time of his prior
RESIGNATION/DISMISSAL if and only if he repays the amount of
the distribution he received on account of such prior
RESIGNATION/DISMISSAL as set forth in Section 8.07 (Conditions
for Repayment of Prior Distribution Upon Reemployment). In
the event such former PARTICIPANT makes a repayment of his
prior distribution or he has not received a distribution, the
amount of such PARTICIPANT'S FORFEITURE, if any, at the time
of his prior RESIGNATION/DISMISSAL shall be restored to his
COMPANY CONTRIBUTION ACCOUNT, and the PARTICIPANT'S YEARS OF
SERVICE shall include YEARS OF SERVICE completed before the
BREAKS IN SERVICE. Amounts so restored shall be subtracted
from the balance of FORFEITURES in the PLAN as of the
ACCOUNTING DATE next following the repayment.
(c) A former PARTICIPANT who terminated his employment after
January 1, 1985, who has incurred five or more consecutive
one-year BREAKS IN SERVICE and who is reemployed by the
COMPANY shall have permanently forfeited the amount, if any,
of such PARTICIPANT'S FORFEITURE which arose because of his
previous RESIGNATION/ DISMISSAL, and the PARTICIPANT'S YEARS
OF SERVICE shall not include YEARS OF SERVICE completed before
the BREAKS IN SERVICE. This paragraph (c) shall also apply to
a former PARTICIPANT who (1) terminated after January 1, 1985,
(2) has incurred less than five consecutive one-year BREAKS IN
SERVICE, (3) is reemployed by the COMPANY and (4) has not made
a repayment of his prior distribution under the provisions set
forth in Section 8.07 (Conditions for Repayment of Prior
Distribution Upon Reemployment).
(d) In the event a former PARTICIPANT is reemployed by the COMPANY
and he has not yet received any part of his COMPANY
CONTRIBUTION ACCOUNT or his DEFERRED WAGE ACCOUNT, he shall be
recredited with his COMPANY CONTRIBUTION ACCOUNT and his
DEFERRED WAGE ACCOUNT shall not be distributed to him until
his subsequent termination of employment.
8.07 CONDITIONS FOR REPAYMENT OF PRIOR DISTRIBUTION UPON REEMPLOYMENT
A former PARTICIPANT who is reemployed by the COMPANY prior to
incurring five or more consecutive one-year BREAKS IN SERVICE may
make a repayment to the PLAN in an amount equal to the entire
distribution he received on account of his prior termination of
employment. Such repayment will be credited to his PRIOR
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PARTICIPANT ACCOUNT as a ROLLOVER CONTRIBUTION or a PRIOR
PARTICIPANT CONTRIBUTION, whichever is applicable. Upon a
subsequent termination of employment, in order to determine the
total vested amount of the COMPANY CONTRIBUTION ACCOUNT, the amount
of the repayment which was previously distributed to him from his
COMPANY CONTRIBUTION ACCOUNT and the INVESTMENT EARNINGS from the
date of repayment shall be considered as part of his COMPANY
CONTRIBUTION ACCOUNT. In order to determine the amount payable from
the COMPANY CONTRIBUTION ACCOUNT at the subsequent termination of
employment, the amount of the repayment and its INVESTMENT EARNINGS
shall be subtracted from the vested amount determined above. The
amount of the repayment, including INVESTMENT EARNINGS, shall always
be 100% vested and nonforfeitable.
Such repayment must be made before the earlier of five years after
the first date on which the PARTICIPANT is subsequently reemployed
by the COMPANY or the date the PARTICIPANT has incurred five one-
year BREAKS IN SERVICE. If such repayment is not made by such time,
the PARTICIPANT shall have permanently forfeited his right to the
FORFEITURE due to his previous RESIGNATION/DISMISSAL.
8.08 DETERMINATION OF ACCOUNT OF REEMPLOYED PARTICIPANT WHO HAS NOT
INCURRED A BREAK IN SERVICE
In the case of a partially vested PARTICIPANT whose employment with
the COMPANY terminated, but is reemployed by the COMPANY prior to
incurring a one-year BREAK IN SERVICE and such PARTICIPANT has
received a distribution of his ACCOUNT and such PARTICIPANT has not
made a repayment of such distribution, upon such PARTICIPANT'S
subsequent termination of employment for any reason, the then vested
portion of such PARTICIPANT'S COMPANY CONTRIBUTION ACCOUNT which
would be distributable shall be determined as follows:
(a) Add the amount of any distribution from his COMPANY
CONTRIBUTION ACCOUNT made to such PARTICIPANT as a result of
his prior termination of employment and not repaid to the then
current balance in his COMPANY CONTRIBUTION ACCOUNT;
(b) Multiply such sum by the applicable "non-forfeitable fraction"
as determined under Section 8.02 (Vesting Upon Retirement or
Death) or Section 8.03 (Vesting Upon Resignation/Dismissal);
and
(c) Subtract the amount of the prior distributions from his
COMPANY CONTRIBUTION ACCOUNT made to such PARTICIPANT under
the PLAN from such product.
8.09 VESTING OF A PARTICIPANT UPON TRANSFER OF EMPLOYMENT
Any person who transfers from employment with the COMPANY as an
EMPLOYEE directly to other employment with the COMPANY or a RELATED
CORPORATION in a capacity other than as an EMPLOYEE shall be deemed
by such transfer not to lose his YEARS OF SERVICE for any purpose.
In addition, he shall not be deemed to retire, or otherwise incur a
VESTING VALUATION DATE until such time as he is no longer in the
employment of the COMPANY or a RELATED CORPORATION. At such time he
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shall be entitled to a distribution of his Account, if any, as
provided in Article 9 (Distribution of Accounts). Notwithstanding
any other provisions of the PLAN, during the period such person is
not an EMPLOYEE, he shall not share in the allocation of the COMPANY
CONTRIBUTION and FORFEITURE as set forth in Section 7.03 (Allocation
of Company Contribution and Forfeitures). For the purposes of
determining such person's vesting percentage under Article 8
(Vesting of Accounts) YEARS OF SERVICE with the COMPANY and/or
RELATED CORPORATION shall be determined as set forth in Section 1.49
(Year of Service).
[8.10] STATEMENT OF ACCOUNT
As soon as practicable after December 31 of each year each
PARTICIPANT shall be furnished with a statement reflecting the
condition of his ACCOUNTS as of such date.
Article 9
DISTRIBUTION OF ACCOUNTS
------------------------
9.01 MANNER OF DISTRIBUTION AND FURTHER ADJUSTMENTS
Subject to the conditions set forth below and the provisions of
Section 9.02 (Inservice Withdrawals), on a PARTICIPANT's VESTING
VALUATION DATE, any amounts to which he is entitled hereunder shall
be distributable to him, or to his BENEFICIARY if he is deceased.
Distribution can be made in either of the following ways, as the
PARTICIPANT determines:
(a) In a lump sum representing the full amount distributable at
the time of such distribution; or
(b) In a series of installments, annually or more frequently, over
a period not to exceed the life expectancy of the PARTICIPANT
or the life expectancy of the PARTICIPANT and his designated
BENEFICIARY, determined as of such PARTICIPANT's DISTRIBUTION
DATE; provided that, if such BENEFICIARY is not the
PARTICIPANT's spouse and is more than 10 years younger than
the PARTICIPANT, the installments shall be paid over a period
not exceeding the joint life expectancy of the PARTICIPANT and
a BENEFICIARY 10 years younger than the PARTICIPANT.
The life expectancy of a PARTICIPANT, his spouse or his designated
BENEFICIARY shall be determined by use of the expected return
multiples contained in the regulations under Section 72 of the CODE.
If a PARTICIPANT so elects, the life expectancy of the PARTICIPANT
and his spouse shall be recalculated annually. In the absence of
such an election, life expectancies shall not be recalculated.
Pursuant to such uniform and nondiscriminatory rules and procedures
as the INVESTMENT ADVISORY BOARD may adopt, a PARTICIPANT who has
elected installment payments may modify the installment period or
the frequency of payments, provided that all installment
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distributions under the PLAN must comply with the requirements of
Section 401(a)(9) of the CODE.
Payments shall commence as promptly as is reasonably convenient
after a PARTICIPANT's VESTING VALUATION DATE, and, unless the
PARTICIPANT otherwise requests, in no event later than the Sixtieth
(60th) day after the close of the calendar year in which the VESTING
VALUATION DATE occurs; provided, however, that if the amount
distributable cannot be ascertained, payment may be made no later
than Sixty (60) days after the earliest date on which the amount
distributable to the PARTICIPANT can be ascertained.
As soon as the amount distributable to such PARTICIPANT or his
BENEFICIARY can reasonably be determined, then a separate
DISTRIBUTION ACCOUNT shall be established in respect of such
distribution in an amount determined under Sections 8.02 (Vesting
Upon Retirement or Death) or 8.03 (Vesting Upon Resignation/
Dismissal). The assets reflected in such DISTRIBUTION ACCOUNT shall
be increased or decreased as set forth in Section 7.02 (Accounting
Procedures); provided, however, that in no event shall the amount
distributed exceed the balance in such DISTRIBUTION ACCOUNT
immediately before such distribution and after such increase or
decrease is made in respect of the prior ACCOUNTING DATE. In the
event that an installment form of distribution is effective,
payments from each such DISTRIBUTION ACCOUNT will be made to the
extent practicable, pro rata from the various investment funds in
which the DISTRIBUTION ACCOUNT is invested, or as the INVESTMENT
ADVISORY BOARD may permit the PARTICIPANT to direct in accordance
with such uniform and nondiscriminatory rules and procedures as the
INVESTMENT ADVISORY BOARD may adopt for such purpose.
If a PARTICIPANT dies after his required commencement date (as
defined in Section 9.08), the remaining portion of his benefits must
be distributed over a period not exceeding the period over which
payments were being made to the PARTICIPANT. If a PARTICIPANT dies
before his required commencement date, his benefits must be
distributed over a period not exceeding the greatest of: (i) five
years from the death of the PARTICIPANT; (ii) in the case of
payments to a designated BENEFICIARY other than the PARTICIPANT's
spouse, the life expectancy of such BENEFICIARY, provided payments
begin within one year of the PARTICIPANT's death; or (iii) in the
case of payments to the PARTICIPANT's spouse, the life expectancy of
such spouse, provided payments begin by the date the PARTICIPANT
would have attained age 70-1/2. A PARTICIPANT may select, in
accordance with such rules as the INVESTMENT ADVISORY BOARD may
establish, the method of distributing his benefits to him; a
PARTICIPANT, if he so desires, may direct how his benefits are to be
paid to his BENEFICIARY; and the INVESTMENT ADVISORY BOARD shall
select the method of distributing the PARTICIPANT's benefits to his
BENEFICIARY if the PARTICIPANT has not filed a direction with the
INVESTMENT ADVISORY BOARD. All distributions under the PLAN shall
comply with the requirements of Section 401(a)(9) of the CODE and
the regulations thereunder. If a PARTICIPANT's vested ACCOUNT
balances exceed $3,500, distributions may not be made to the
PARTICIPANT before age 65 without his consent.
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9.02 INSERVICE WITHDRAWALS
While it is the primary purpose of the PLAN to accumulate funds for
use of PARTICIPANTS when they retire, it is recognized that under
some circumstances it may be in the best interests of a PARTICIPANT
to permit a withdrawal by him while he continues in the active
employment of the COMPANY. Accordingly, the INVESTMENT ADVISORY
BOARD may permit a PARTICIPANT to make an inservice withdrawal from
his PRIOR PARTICIPANT ACCOUNT and, in hardship situations, the
INVESTMENT ADVISORY BOARD may permit a PARTICIPANT to make an
inservice withdrawal from his DEFERRED WAGE ACCOUNT.
A. Withdrawals from PRIOR PARTICIPANT ACCOUNT
The PARTICIPANT may make inservice withdrawals from his PRIOR
PARTICIPANT ACCOUNT from time to time only in such amounts as,
in the INVESTMENT ADVISORY BOARD's opinion, shall be
reasonably necessary in accordance with such procedures as the
INVESTMENT ADVISORY BOARD shall determine, but in no event
shall the cumulative amount of all such inservice withdrawals
made by a PARTICIPANT exceed the lesser of (a) the amount of
his total PRIOR PARTICIPANT CONTRIBUTIONS thereto, or (b) the
balance of his PRIOR PARTICIPANT ACCOUNT as of the ACCOUNTING
DATE immediately preceding such inservice withdrawal.
Payments of amounts withdrawn by a PARTICIPANT shall be made,
to the extent practicable, pro rata from the investment funds
in which the PARTICIPANT'S ACCOUNT is invested, or as the
INVESTMENT ADVISORY BOARD may permit the PARTICIPANT to direct
in accordance with such uniform and nondiscriminatory rules
and procedures as the INVESTMENT ADVISORY BOARD may adopt for
such purpose.
For purposes of this section, withdrawals shall be limited to
the following purposes:
1) Medical expenses of the PARTICIPANT, his spouse, or his
children or dependents;
2) Payment on an existing real estate mortgage on the
PARTICIPANT'S principal residence;
3) Repairs on the PARTICIPANT'S residence;
4) Post high school educational expenses of the
PARTICIPANT, his spouse, or his children or dependents;
or
5) Purchase of a new principal residence by the
PARTICIPANT.
The PLAN requires minimum withdrawal amounts for each
category. A minimum withdrawal of Five Hundred and 00/100
Dollars ($500.00) is required for medical and educational
expenses. A minimum withdrawal of One Thousand and 00/100
Dollars ($1,000.00) is required for payment of real estate
mortgages, repairs to a residence, or the purchase price of a
new residence; however, the minimum withdrawal provision is
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waived for a PARTICIPANT who seeks a hardship withdrawal to
purchase his first residence.
The PLAN requires a PARTICIPANT to verify the amount of the
hardship by providing the INVESTMENT ADVISORY BOARD with the
following information:
1) Medical Expenses -- Attach the explanation of the
benefits statement received from the applicable Fort
Howard medical plan and the benefits statement of any
other insurance company which may be involved.
2) Payment on an Existing Real Estate Mortgage on Present
Residence -- Attach a letter addressed to the
PARTICIPANT from the present mortgage holder and signed
by an officer of said mortgage holder, if applicable,
detailing the following:
a) Current mortgage balance;
b) Address of residence;
c) Year residence was purchased;
d) Present monthly mortgage payments; and
e) Monthly payments after reduction of mortgage, if
applicable.
3) Major Repairs on Present Home
a) Attach a contractor's estimate showing date,
PARTICIPANT'S name and address, description of
work, itemized costs of materials and labor, and
contractor's signature; or
b) If the PARTICIPANT is doing the work himself, he
must attach a supplier's estimate showing the date,
PARTICIPANT'S name and address, and an itemized
cost of materials and the supplier's signature.
4) Educational Expenses
a) Name and relationship to PARTICIPANT of person
seeking post high school education;
b) A letter from the school, on school letterhead,
indicating that such person has been accepted for
enrollment, estimated cost of room and board, and
tuition by semester, quarter, or other applicable
payment period; and
c) The date this person is expected to begin school.
5) Purchase of New Residence
a) Submit a copy of the offer to purchase signed by
both seller and PARTICIPANT, which shall include:
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i) Address of new home to be purchased;
ii) Amount to be paid for new residence;
iii) Amount of downpayment and estimated closing
costs; and
iv) Amount of mortgage.
Note that iii) and iv) above will usually have to
be provided by the mortgage lender on company
letterhead and signed by an officer of the mortgage
lender.
b) Statement by the PARTICIPANT that the purchase of
this residence will constitute his principal
residence and also a statement as to whether or not
the residence is a single residence or a duplex.
In addition, the INVESTMENT ADVISORY BOARD may
require the PARTICIPANT to furnish paid receipts or
other information which would verify that the
withdrawal was used for the purpose stated by the
PARTICIPANT.
B. Withdrawals from DEFERRED WAGE ACCOUNT
The PARTICIPANT may make inservice hardship withdrawals from
his DEFERRED WAGE ACCOUNT from time to time only in such
amounts as, in the INVESTMENT ADVISORY BOARD's opinion, shall
be reasonably necessary in accordance with such procedures as
the INVESTMENT ADVISORY BOARD shall determine, but in no event
shall the cumulative amount of such inservice hardship
withdrawals made by a PARTICIPANT exceed the lesser of (a) the
amount of his total DEFERRED WAGE ACCOUNT CONTRIBUTIONS
thereto or (b) the balance of his DEFERRED WAGE ACCOUNT as of
the accounting date immediately preceding such inservice
hardship withdrawal.
A hardship distribution will not be allowed unless the
PARTICIPANT can demonstrate a financial hardship and the
distribution is necessary to satisfy such financial hardship.
For purposes of this subsection, "financial hardship" shall be
limited to the following:
1) Medical expenses, described in Internal Revenue Code
Section 213(d), incurred by the PARTICIPANT, his
spouse, or his children or dependents;
2) Purchase of a new principal residence by the
PARTICIPANT (excluding mortgage payments);
3) Payment of tuition for the next semester or quarter of
post-secondary education for the PARTICIPANT, his
spouse, or his children or dependents; or
- 29 -
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.
A distribution will be treated as necessary to satisfy a
financial hardship of a PARTICIPANT if all of the following
requirements are satisfied:
1) The distribution is not in excess of the amount of the
immediate and heavy financial need of the PARTICIPANT;
2) The PARTICIPANT has obtained all distributions, other
than inservice hardship withdrawals, and all nontaxable
loans currently available under all plans maintained by
the COMPANY;
3) The PARTICIPANT'S DEFERRED WAGE CONTRIBUTIONS shall be
suspended for 12 months after receipt of the
withdrawal; and
4) The PARTICIPANT may not make DEFERRED WAGE
CONTRIBUTIONS for the PARTICIPANT'S taxable year
immediately following the taxable year of the inservice
hardship withdrawal in excess of the applicable limit
under Section 402(g) of the CODE for such next taxable
year less the amount of such PARTICIPANT's DEFERRED
WAGE CONTRIBUTIONS for the taxable year of the
inservice hardship withdrawal.
The amount treated as necessary to satisfy a PARTICIPANT'S
financial hardship under this subsection shall include any
amounts necessary to pay any federal, state or local income
taxes or penalties reasonably anticipated as a result of the
hardship distribution. The PLAN requires a minimum withdrawal
amount for each hardship category. A minimum withdrawal of
Five Hundred and 00/100 Dollars ($500.00) is required for
medical or educational hardship. A minimum withdrawal of One
Thousand and 00/100 Dollars ($1,000.00) is required for the
purpose of an EMPLOYEE'S purchase of a new principal
residence, for preventing an EMPLOYEE'S eviction from his
principal residence, or for preventing foreclosure of the
mortgage on an EMPLOYEE'S principal residence.
Payments of amounts withdrawn by a PARTICIPANT shall be made,
to the extent practicable, pro rata from the investment funds
in which the PARTICIPANT'S ACCOUNT is invested or as the
INVESTMENT ADVISORY BOARD may permit the PARTICIPANT to direct
in accordance with such uniform and nondiscriminatory rules
and procedures as the INVESTMENT ADVISORY BOARD may adopt for
such a purpose.
[9.03] REPAYMENTS OF INSERVICE WITHDRAWALS
An amount withdrawn by a PARTICIPANT may be partially or entirely
restored to his PRIOR PARTICIPANT ACCOUNT as of any ACCOUNTING DATE.
Amounts so restored thereafter shall be treated as contributions by
- 30 -
him, except that they shall not be considered such for purposes of
Section 7.03 (Allocation of Company Contributions and Forfeitures)
or the contribution limitations imposed by Section 415 of the CODE.
[9.04] DESIGNATION OF BENEFICIARY
Each living PARTICIPANT, from time to time, may name a person(s) or
entity(ies) (who may be named contingently or successively) to whom
his ACCOUNT balances are to be paid in the case of his death before
he receives all of his benefits. If a PARTICIPANT designates
someone other than (or in addition to) his spouse as his primary
BENEFICIARY, his spouse must consent in writing to the designation.
Each designation shall revoke all prior designations by the same
PARTICIPANT in writing with the INVESTMENT ADVISORY BOARD during his
lifetime. If a deceased PARTICIPANT has failed to name a
BENEFICIARY in the manner provided above, or if the BENEFICIARY
named by a deceased PARTICIPANT dies before him or before complete
distribution of the PARTICIPANT'S ACCOUNT balances, the INVESTMENT
ADVISORY BOARD shall direct the TRUSTEE to distribute such
PARTICIPANT'S ACCOUNT BALANCES to the first surviving class of the
following successive preference beneficiaries:
(a) Widow or widower;
(b) Surviving children;
(c) Surviving parents;
(d) Surviving brothers and sisters; and
(e) Executors or administrators.
9.05 MISSING PARTICIPANTS OR BENEFICIARIES
Each PARTICIPANT and each BENEFICIARY of a deceased PARTICIPANT
shall file with the INVESTMENT ADVISORY BOARD from time to time in
writing his post office address and each change of post office
address, and any communication, statement, or notice addressed to a
PARTICIPANT or BENEFICIARY at his last post office address filed
with the INVESTMENT ADVISORY BOARD, or if no such address was filed
with the INVESTMENT ADVISORY BOARD then at his last post office
address as shown on the COMPANY'S records, shall be binding on the
PARTICIPANT or his BENEFICIARY for all purposes of the PLAN.
Neither the TRUSTEE nor the INVESTMENT ADVISORY BOARD shall be
obliged to search for or ascertain the whereabouts of any
PARTICIPANT or any BENEFICIARY. If the INVESTMENT ADVISORY BOARD
notifies any PARTICIPANT or BENEFICIARY of a deceased PARTICIPANT
that he is eligible for a distribution and also notifies him of the
provisions of this Section, and the PARTICIPANT or his BENEFICIARY
fails to claim his benefits or make his whereabouts known to the
INVESTMENT ADVISORY BOARD within three years thereafter, the
benefits of such PARTICIPANT or BENEFICIARY shall be reallocated to
the accounts of other PARTICIPANTS in the manner set forth in
Section 7.03 (Allocation of Company Contributions and Forfeitures)
- 31 -
as an additional COMPANY CONTRIBUTION.
Any amounts so reallocated shall be deducted from the current
COMPANY CONTRIBUTION and again become payable to such PARTICIPANT or
BENEFICIARY upon filing of a written claim for benefits under the
PLAN with the INVESTMENT ADVISORY BOARD and upon furnishing evidence
of entitlement to such benefits as the INVESTMENT ADVISORY BOARD may
require.
9.06 DISTRIBUTION IN COMPANY SECURITIES
A PARTICIPANT may decide, in accordance with such rules as the
INVESTMENT ADVISORY BOARD may establish, whether his distributions
shall be made entirely or partially in securities of the COMPANY,
valued at their fair market value on the ACCOUNTING DATE immediately
preceding the DISTRIBUTION DATE.
9.07 ALTERNATE PAYEE DUE TO INCAPACITY
When a PARTICIPANT or the BENEFICIARY of a deceased PARTICIPANT is
(a) adjudged legally incompetent by a court of law, (b) a minor, or
(c) in the INVESTMENT ADVISORY BOARD's opinion is in any way
incapacitated so as to be unable to manage his financial affairs,
the INVESTMENT ADVISORY BOARD may direct the TRUSTEE to make
payments or distributions to the PARTICIPANT'S or BENEFICIARY'S
legal representatives or to a relative or friend of the PARTICIPANT
or BENEFICIARY for his benefit, or the INVESTMENT ADVISORY BOARD may
have the TRUSTEE apply the payment or distribution for the benefit
of the PARTICIPANT or BENEFICIARY in any manner that the INVESTMENT
ADVISORY BOARD determines.
9.08 COMMENCEMENT OF DISTRIBUTIONS
A PARTICIPANT who attains age 70-1/2 on or after January 1, 1988,
must commence receipt of his retirement benefit no later than
April 1 of the PLAN YEAR following the PLAN YEAR in which such
PARTICIPANT attains age 70-1/2 (his "required commencement date"),
regardless of whether he has terminated his employment with the
COMPANY or a RELATED CORPORATION. Notwithstanding the preceding
sentence, an active PARTICIPANT who owns (or is considered as owning
within the meaning of Section 318 of the CODE) 5% or more of the
stock of the COMPANY or a RELATED CORPORATION must commence to
receive his retirement benefit no later than April 1 of the PLAN
YEAR following the PLAN YEAR in which such active PARTICIPANT
attains age 70-1/2 (his "required commencement date"), regardless of
whether he has terminated his employment with the COMPANY or RELATED
CORPORATION.
9.09 DIRECT TRANSFER OF ELIGIBLE ROLLOVER DISTRIBUTIONS
Notwithstanding any provision of the PLAN to the contrary, a
"distributee" under the PLAN (as defined below) who receives an
"eligible rollover distribution" (as defined below) under Section
9.01 may elect, at the time and in the manner prescribed by the
- 32 -
INVESTMENT ADVISORY BOARD, to have any portion of the distribution
paid directly to an "eligible retirement plan" (as defined below)
designated by the distributee in a direct rollover. An eligible
rollover distribution is any distribution of all or any portion of
the balance to the credit of the distributee, except that an
eligible rollover distribution does not include the following:
(a) Any distribution that is one of a series of substantially
equal periodic payments (not less frequently than annually)
made for the life (or life expectancy) of the distributee or
the joint lives (or joint life expectancies) of the
distributee and the distributee's designated beneficiary, or
for a specified period of ten years or more;
(b) Any distribution to the extent such distribution is required
under CODE Section 401(a)(9); and
(c) The portion of any distribution that is not includible in
gross income (determined without regard to the exclusion for
net unrealized appreciation with respect to employer
securities).
An eligible retirement plan is an individual retirement account
described in CODE Section 408(a), an individual retirement annuity
described in CODE Section 408(d), an annuity plan described in CODE
Section 403(a), or a qualified trust described in CODE Section
401(a), that accepts the distributee's eligible rollover
distribution. However, in the case of an eligible rollover
distribution to the surviving spouse of a PARTICIPANT, an eligible
retirement plan is an individual retirement account or individual
retirement annuity. For purposes of the PLAN, a PARTICIPANT'S
surviving spouse and the PARTICIPANT'S spouse or former spouse who
is an alternate payee under a qualified domestic relations order, as
defined in CODE Section 414(p), are distributees with regard to
their respective interests.
Article 10
MISCELLANEOUS
-------------
10.01 INFORMATION TO BE FURNISHED BY PARTICIPANTS
PARTICIPANTS shall furnish to the TRUSTEE and the INVESTMENT
ADVISORY BOARD such evidence, data or information as the TRUSTEE and
the INVESTMENT ADVISORY BOARD respectively consider necessary or
desirable for the purpose of administering the PLAN. The benefits
provided under the PLAN for each such PARTICIPANT are upon the
condition that he will furnish full, true and complete evidence,
data and information required by the TRUSTEE and the INVESTMENT
ADVISORY BOARD.
- 33 -
10.02 INTERESTS NOT TRANSFERABLE
The interests of PARTICIPANTS under the PLAN are not in any way
subject to their debts or other obligations and may not be
voluntarily or involuntarily sold, transferred or assigned except as
may be set forth in a QUALIFIED DOMESTIC RELATIONS ORDER received by
the INVESTMENT ADVISORY BOARD. In the case of receipt of a domestic
relations order by the INVESTMENT ADVISORY BOARD, the PARTICIPANT
and the alternate payee (as defined in Section 1.38 (Qualified
Domestic Relations Order)) shall be notified within a reasonable
period of time of the receipt of such order and its procedures for
determining whether such order is a QUALIFIED DOMESTIC RELATIONS
ORDER. Notwithstanding any other provisions of the PLAN, benefits
payable to an alternate payee under the terms of a domestic
relations order determined to be a QUALIFIED DOMESTIC RELATIONS
ORDER shall be paid immediately in a lump sum unless the terms of
the QUALIFIED DOMESTIC RELATIONS ORDER provide for another method or
time of distribution, in which case distribution of the alternate
payee's benefits shall be made in accordance with the terms of the
QUALIFIED DOMESTIC RELATIONS ORDER.
10.03 ABSENCE OF GUARANTY
Neither the TRUSTEE, the INVESTMENT ADVISORY BOARD, nor the COMPANY
in any way guarantees the TRUST FUND from loss or depreciation. The
COMPANY does not guarantee the payment of any money which may be or
become due to any person under the PLAN, and the liability of the
TRUSTEE, the INVESTMENT ADVISORY BOARD and the COMPANY to make any
payment under the PLAN shall be limited to amounts held in ACCOUNTS
of the PLAN.
10.04 EMPLOYMENT RIGHTS
Participation in the PLAN shall not give any EMPLOYEE the right to
be retained in the service of the COMPANY, nor any right or claim to
any benefit under the PLAN unless such right or claim has
specifically accrued under the terms of the PLAN.
10.05 GENDER AND NUMBER
For the purposes of the PLAN and the TRUST, words in the masculine
gender shall include the feminine and neuter genders, the plural
shall include the singular and the singular shall include the
plural.
10.06 REVIEW OF BENEFIT DETERMINATIONS
The provisions of this Section 10.06 shall control with respect to
the resolution of claims for benefits under the PLAN. Whenever the
INVESTMENT ADVISORY BOARD decides for whatever reason to deny,
whether in whole or in part, a claim for benefits filed by any
person (hereinafter referred to as the "Claimant"), the INVESTMENT
ADVISORY BOARD shall transmit a written notice of its decision to
- 34 -
the Claimant within 90 days, which notice shall be written in a
manner calculated to be understood by the Claimant and shall contain
a statement of the specific reasons for the denial of the claim and
a statement advising the Claimant that, within 60 days of the date
on which he receives such notice, he may obtain review of the
decision of the INVESTMENT ADVISORY BOARD in accordance with the
procedures hereinafter set forth. Within such 60-day period, the
Claimant or his authorized representative may request that the claim
denial be reviewed by filing with the INVESTMENT ADVISORY BOARD a
written request therefore, which request shall contain the following
information:
(a) the date on which the Claimant's request filed with the
INVESTMENT ADVISORY BOARD; provided, however, that the date on
which the Claimant's request for review was in fact filed with
the INVESTMENT ADVISORY BOARD shall control in the event that
the date of the actual filing is later than the date stated by
the Claimant pursuant to this paragraph (a);
(b) the specific portions of the denial of his claim which the
Claimant requests the INVESTMENT ADVISORY BOARD to review;
(c) a statement by the Claimant setting forth the basis upon which
he believes the INVESTMENT ADVISORY BOARD should reverse its
previous denial of his claim for benefits and accept his claim
as made; and
(d) any written material (offered as exhibits) which the Claimant
desires the INVESTMENT ADVISORY BOARD to examine in its
consideration of his position as stated pursuant to
paragraph (c) of this Section 10.06.
Within 60 days of the date determined pursuant to paragraph (a) of
this Section 10.06, the INVESTMENT ADVISORY BOARD shall conduct a
full and fair review of its decision denying the Claimant's claim
for benefits. Within 60 days of the date of such hearing, the
INVESTMENT ADVISORY BOARD shall render its written decision on
review, written in a manner calculated to be understood by the
Claimant, specifying the reasons and PLAN provisions upon which its
decision was based.
10.07 ERISA
The PLAN shall be implemented and administered in accordance with
ERISA and any and all other applicable laws.
10.08 UNIFORM ADMINISTRATION
The PLAN, and any and all rules relating thereto, shall be
implemented and administered in a uniform and non-discriminatory
manner.
- 35 -
10.09 AMENDMENT OR DISCONTINUANCE
While the COMPANY expects to continue the PLAN, it must necessarily
reserve and has reserved the right to amend or discontinue the PLAN
at any time, provided that no amendment shall result in the return
or repayment to the COMPANY of any part of the TRUST FUND or the
income therefrom, or result in the distribution of the TRUST FUND
for the benefit of anyone other than PARTICIPANTS and former
PARTICIPANTS and other persons entitled to benefits under the PLAN,
except as provided in Section 10.14. PARTICIPANTS shall be notified
of such amendment or discontinuance within a reasonable time. Upon
partial or complete termination of the PLAN or upon permanent
discontinuance of COMPANY CONTRIBUTIONS under the PLAN, each
affected PARTICIPANT'S account balances shall be fully vested in him
and shall be distributed to him by any one or both of the methods
specified in Article 9 (Distribution of Accounts).
10.10 PLAN MERGER OR CONSOLIDATION
In the event of any merger or consolidation of the PLAN with, or
transfer of assets or liabilities to, any other plan, each
PARTICIPANT in the PLAN must be entitled, if the other plan is then
terminated, to receive a benefit immediately after the merger,
consolidation or transfer which is equal to or greater than the
benefit the PARTICIPANT would have been entitled to receive
immediately before the merger, consolidation or transfer if the PLAN
had then terminated.
10.11 TRUST AGREEMENT
Attention is directed to the fact that the TRUST implements the
PLAN. A copy of the TRUST is on file at the office of the Secretary
of the COMPANY where it may be examined by any PARTICIPANT if he so
desires. The provisions of and benefits under the PLAN are subject
to the terms of the TRUST.
10.12 WISCONSIN LAW TO GOVERN
This PLAN shall be construed and regulated and its validity and
effect and the rights hereunder of all parties interested shall at
all times be determined, and this PLAN shall be administered in
accordance with the laws of the State of Wisconsin, subject,
however, to applicable provisions of ERISA, and the CODE, as the
same may, from time to time, be amended. Notwithstanding anything
to the contrary, in the event of a conflict between the TRUST and
the PLAN regarding the applicability of state law, the provisions of
this PLAN shall govern.
In case any provision of this PLAN and/or TRUST shall be held
illegal or invalid for any reason, said illegality or invalidity
shall not affect the remaining parts of the PLAN and/or TRUST, but
the PLAN and/or TRUST shall be construed and enforced as if said
illegal and invalid provisions had never been inserted herein.
- 36 -
10.13 STOCK RIGHTS OF PARTICIPANTS
(a) Voting Rights. For purposes of this Section, COMPANY
Securities means any voting stock issued by the COMPANY. Each
PARTICIPANT (or, in the event of his death, his BENEFICIARY)
shall have the right to direct the TRUSTEE as to the manner in
which his proportionate share of COMPANY Securities held in
the TRUST FUND are to be voted on each matter brought before
an annual or special stockholders' meeting of the COMPANY.
Before each such meeting of stockholders, the INVESTMENT
ADVISORY BOARD shall cause to be furnished to each PARTICIPANT
(or BENEFICIARY) a copy of the proxy solicitation material,
together with a form requesting confidential directions on how
such PARTICIPANT'S proportionate share of COMPANY Securities
held in the TRUST FUND shall be voted on each such matter.
Upon timely receipt of such directions, the TRUSTEE shall on
each such matter vote as directed a number of shares
(including fractional shares) of COMPANY Securities
representing the PARTICIPANT'S proportionate share of COMPANY
Securities held in the TRUST FUND. The instructions received
by the TRUSTEE from PARTICIPANTS shall be held by the TRUSTEE
in confidence and shall not be divulged or released to any
person, including officers or employees of the COMPANY or any
RELATED CORPORATION. The TRUSTEE shall vote shares with
respect to which it has not received direction in the same
proportion as shares with respect to which it has received
PARTICIPANTS' (or BENEFICIARIES') directions.
(b) Rights on Tender or Exchange Offer. Each PARTICIPANT (or, in
the event of his death, his BENEFICIARY) for purposes of this
Section 10.13(b) is hereby designated a "named fiduciary"
within the meaning of Section 403(a)(1) of ERISA and shall
have the right, to the extent of his proportionate share of
COMPANY Securities held in the TRUST FUND, to direct the
TRUSTEE in writing as to the manner in which to respond to a
tender or exchange offer with respect to shares of COMPANY
Securities. The INVESTMENT ADVISORY BOARD shall use its best
efforts to timely distribute or cause to be distributed to
each PARTICIPANT (or BENEFICIARY) such information as will be
distributed to stockholders of the COMPANY in connection with
any such tender or exchange offer. Upon timely receipt of
such instructions, the TRUSTEE shall respond as instructed
with respect to a number of shares of COMPANY Securities
representing such PARTICIPANT'S proportionate share of COMPANY
Securities held in the TRUST FUND. The instructions received
by the TRUSTEE from PARTICIPANTS shall be held by the TRUSTEE
in confidence and shall not be divulged or released to any
person, including officers or employees of the COMPANY or any
RELATED CORPORATION. If the TRUSTEE shall not receive timely
instruction from a PARTICIPANT (or BENEFICIARY) as to the
manner in which to respond to such a tender or exchange offer,
the TRUSTEE shall not tender or exchange any shares of COMPANY
Securities with respect to which such PARTICIPANT has the
right of direction.
- 37 -
10.14 NO INTEREST IN COMPANY
The COMPANY shall have no right, title or interest in the TRUST
FUND, nor shall any part of the TRUST FUND revert or be repaid to
the COMPANY, directly or indirectly, unless:
(a) a contribution is made by the COMPANY by mistake of fact and
such contribution is returned to the COMPANY within one year
after payment to the TRUSTEE; or
(b) a contribution conditioned on the deductibility thereof is
disallowed as an expense for federal income tax purposes and
such contribution (to the extent disallowed) is returned to
the COMPANY within one year after the disallowance of the
deduction.
The amount of any contribution that may be returned to the
COMPANY pursuant to subparagraph (a) or (b) above must be
reduced by any portion thereof previously distributed from the
TRUST FUND and by any losses of the TRUST FUND allocable
thereto, and in no event may the return of such contribution
cause any PARTICIPANT's ACCOUNTS to be less than the amount of
such ACCOUNTS had the contribution not been made under the
PLAN.
Article 11
TOP HEAVY RESTRICTIONS
----------------------
11.01 DEFINITIONS
For purposes only of this Article 11 (Top Heavy Restrictions), the
following definitions shall apply in addition to those set forth in
Article 1 (Definitions). In case of a conflict, the definitions in
this Section 11.01 (Definitions) shall supersede Article 1
(Definitions).
(a) "REQUIRED AGGREGATION GROUP" means (i) each qualified
retirement plan sponsored by the COMPANY or any RELATED
CORPORATION in which a KEY EMPLOYEE is a participant and (ii)
each other qualified retirement plan which enables any plan
described in subparagraph (i) to meet the requirements of the
CODE as they apply to coverage, participation and non-
discrimination requirements as set forth in Sections 401(a)(4)
and 410 of the CODE.
(b) "PERMISSIVE AGGREGATION GROUP" means a group of plans
consisting of any qualified retirement plan sponsored by the
COMPANY or any RELATED CORPORATION not required to be part of
the REQUIRED AGGREGATION GROUP plus any plans which are in the
REQUIRED AGGREGATION GROUP provided that when taken
collectively the plans continue to meet the requirements of
the CODE as they apply to coverage, participation and non-
discrimination requirements as set forth in Sections 401(a)(4)
and 410 of the CODE.
- 38 -
(c) "KEY EMPLOYEE" means any employee of the COMPANY or any
RELATED CORPORATION who is participating in a retirement plan
sponsored by the COMPANY or any RELATED CORPORATION as of the
DETERMINATION DATE who at any time during the PLAN YEAR or
any four (4) preceding PLAN YEARS is (was) (i) an officer of
the COMPANY or any RELATED CORPORATION having an annual
compensation from the COMPANY or a RELATED CORPORATION
greater than fifty percent (50%) of the amount in effect
under Section 415(b)(1)(A) of the CODE for any such PLAN
YEAR, (ii) one of the ten (10) EMPLOYEES having an annual
compensation from the COMPANY or a RELATED CORPORATION
greater than the limitation in effect under Section
415(c)(1)(A) of the CODE and owning (or is considered as
owning within the meaning of Section 318 of the CODE) the
largest interests in the COMPANY or any RELATED CORPORATION,
(iii) a 5% stockholder (or is considered as owning 5% or more
of the stock within the meaning of Section 318 of the CODE) of
the COMPANY or any RELATED CORPORATION, or (iv) a 1%
stockholder (or is considered as owning 1% or more of the
stock within the meaning of Section 318 of the CODE) of the
COMPANY or any RELATED CORPORATION and having an annual
compensation paid by the COMPANY or any RELATED CORPORATION in
excess of $150,000. For purposes of (i) above, no more than
fifty (50) EMPLOYEES (or, if lesser, the greater of 3
EMPLOYEES or ten percent (10%) of the EMPLOYEES) shall be
treated as officers.
(d) "NON-KEY EMPLOYEE" means any employee of the COMPANY or any
RELATED CORPORATION who is not a KEY EMPLOYEE.
(e) "DETERMINATION DATE" means each December 31, beginning with
December 31, 1983.
(f) "EMPLOYEE" means any employee of the COMPANY or any RELATED
CORPORATION who is a KEY EMPLOYEE or a NON-KEY EMPLOYEE.
(g) "VALUATION DATE" means each December 31, beginning with
December 31, 1983.
(h) "AGGREGATION GROUP" means either a REQUIRED AGGREGATION GROUP
and/or a PERMISSIVE AGGREGATION GROUP.
11.02 TOP HEAVY DEFINED
This PLAN will be deemed "top-heavy" and notwithstanding any other
provisions of this PLAN, this Article 11 (Top Heavy Restrictions)
shall apply as of the beginning of the PLAN YEAR following the
DETERMINATION DATE if as of the DETERMINATION DATE this PLAN is a
plan in the REQUIRED AGGREGATION GROUP and the sum of (a) and (b)
below exceeds 60 percent of a similar sum determined for all
EMPLOYEES of the AGGREGATION GROUP.
(a) the aggregate present value based upon the immediately
preceding VALUATION DATE (using the applicable actuarial
assumptions used in the valuation of the applicable plan) of
the benefits payable to all KEY EMPLOYEES under all the
defined benefit plans of the AGGREGATION GROUP as if all KEY
- 39 -
EMPLOYEES terminated their employment on the DETERMINATION
DATE; and
(b) the aggregate account balances, as of the most recent
valuation, of all KEY EMPLOYEES (excluding any balances
attributable to rollover contributions made after December 31,
1983, from another qualified retirement plan of another
employer) who are participants in any defined contribution
plan of the AGGREGATION GROUP.
(c) In making the determinations, the following rules shall apply:
(i) Such sum shall be increased by the aggregate
distributions, if any, made to any former or current
EMPLOYEE during the 5-year period ending on the
DETERMINATION DATE, including distributions under a
terminated plan which, if it had not been terminated,
would have been included in the REQUIRED AGGREGATION
GROUP.
(ii) The present value determined in (a) or the account
balance determined in (b) of this Section 11.02 (Top
Heavy Defined) for a current or former employee who was
previously a KEY EMPLOYEE but who is no longer a KEY
EMPLOYEE, shall be disregarded.
(iii) The present value determined in (a) or the account
balance determined in (b) of this Section 11.02 (Top
Heavy Defined) for a beneficiary of a former EMPLOYEE
shall be considered the present value or account
balance of the former EMPLOYEE.
(iv) On and after January 1, 1985, the present value
determined in (a) or account balance determined in (b)
of this Section 11.02 (Top Heavy Defined) on behalf of
a former EMPLOYEE shall not be taken into account if
such former EMPLOYEE had not performed any services for
the COMPANY or a RELATED CORPORATION at any time during
the 5 year period ending on the DETERMINATION DATE.
(v) The actuarial assumptions used for measuring accrued
benefits under all defined benefit plans in the
REQUIRED AGGREGATION GROUP shall be identical.
(vi) The present value determined in (a) or the account
balance determined in (b) of this Section 11.02 for a
current or former EMPLOYEE who is not a KEY EMPLOYEE
shall be determined under the method that is used for
all plans of the COMPANY and RELATED CORPORATIONS, or
if there is no such method, as if such benefits accrued
no more rapidly than the slowest accrual rate permitted
under Section 411(b)(1)(C) of the CODE.
11.03 VESTING PROCEDURES
(a) In the event this PLAN is determined "top-heavy", only for the
PLAN YEAR during which this Article 11 (Top Heavy
- 40 -
Restrictions) applies, the vesting provisions of this
Section 11.03 (Vesting Provisions) shall apply and
Section 8.03 (Vesting Upon Resignation/Dismissal) shall be
inapplicable.
(b) A PARTICIPANT (i) who completes an HOUR OF SERVICE in a PLAN
YEAR during which the PLAN is deemed to be "top-heavy", and
(ii) who has at least two (2) YEARS OF SERVICE, and (iii)
whose employment terminates for any reason other than death
and (iv) who is not 100% vested due to RETIREMENT or death as
specified in Section 8.02 (Vesting Upon Retirement or Death)
shall be vested as of his VESTING VALUATION DATE based upon
the table in paragraph (e) below.
(c) The vested percentage of the COMPANY CONTRIBUTION ACCOUNT of a
PARTICIPANT whose employment with the COMPANY terminates
within a PLAN YEAR during which the PLAN IS "top heavy" shall
be based upon the table below and the YEARS OF SERVICE as of
such PARTICIPANT'S VESTING VALUATION DATE.
Percent of COMPANY
YEARS OF SERVICE CONTRIBUTION ACCOUNT
as of a VESTING as of a VESTING
VALUATION DATE VALUATION DATE
---------------- --------------------
2 20
3 40
4 60
5 80
6 or more 100
(d) In any succeeding PLAN YEAR during which this PLAN is not "top
heavy", any active PARTICIPANT who has three or more YEARS OF
SERVICE as of the last day of the PLAN YEAR during which the
PLAN is "top-heavy" will be permitted to make an election
whether his COMPANY CONTRIBUTION ACCOUNT will continue to vest
on the table set forth in paragraph (c) above or the basis set
forth in Section 8.03 (Vesting Upon Resignation/Dismissal) of
the PLAN.
(e) any succeeding PLAN YEAR during which this PLAN is not "top-
heavy," the dollar amount of the vested percentage of the
COMPANY CONTRIBUTION ACCOUNT of any PARTICIPANT shall not be
less than the dollar amount of the vested percentage of the
COMPANY CONTRIBUTION ACCOUNT (including the INCREMENT) of such
PARTICIPANT as of the day immediately preceding the beginning
of the first PLAN YEAR in which the PLAN is not "top-heavy."
11.04 MINIMUM BENEFITS FOR NON-KEY EMPLOYEES
(a) In the event this PLAN is determined "top-heavy," a NON-KEY
EMPLOYEE who is an active PARTICIPANT of this PLAN as of the
end of the PLAN YEAR of the December 31 of a PLAN YEAR in
which the PLAN is "top-heavy" shall be entitled to a minimum
allocation of the COMPANY CONTRIBUTION in lieu of the
allocation of the COMPANY CONTRIBUTION set forth in Section
7.03 (Allocation of Company Contributions and Forfeitures) (if
- 41 -
such allocation results in a lesser amount) of three percent
(3%) of the PARTICIPANT'S total cash compensation from the
COMPANY (as stated on such PARTICIPANT'S Wage and Tax
Statement (Form W-2)).
(b) For the PLAN YEAR beginning January 1, 1984, if the allocation
for each KEY EMPLOYEE under Section 7.03 (Allocation of
Company Contribution and Forfeitures), when combined with the
DEFERRED WAGE CONTRIBUTIONS of such KEY EMPLOYEE does not
exceed three percent (3%) of the lesser of $200,000 or the
PARTICIPANT'S total cash compensation from the COMPANY (as
stated on such PARTICIPANT'S Wage and Tax Statement (Form
W-2)) for the year in which the PLAN is determined to be "top-
heavy," then the minimum benefit outlined in paragraph (a) of
this Section 11.04 (Minimum Benefits for Non-Key Employees)
shall be the highest percentage determined for a KEY EMPLOYEE
based upon this paragraph (b).
(c) For any PLAN YEAR beginning on or after January 1, 1985, the
alternative minimum outlined in paragraph (b) above shall be
determined based upon the allocation under Section 7.03
(Allocation of Company Contribution and Forfeitures) when
compared to the lesser of $200,000 or the PARTICIPANT's total
cash compensation from the COMPANY (as stated on such
PARTICIPANT's Wage and Tax Statement (Form W-2)) for the year.
11.05 MAXIMUM ANNUAL COMPENSATION
In the event the PLAN is determined to be "top-heavy," the maximum
annual compensation taken into account, if any, to determine
benefits under the PLAN shall be $200,000 (as adjusted for cost of
living increases in the same manner as the dollar amount contained
in Section 415(c)(1)(A) of the CODE). This section shall only apply
during any PLAN YEAR in which the PLAN is "top-heavy."
11.06 FORMULA FOR DETERMINING COMPANY CONTRIBUTIONS
In the event this PLAN is determined "top heavy," Exhibit A (Formula
for Determining Contributions under Fort Howard [Paper Company]
Profit Sharing Retirement Plan) shall be superseded to the extent to
permit Section 11.04 (Minimum Benefits for Non-Key Employees) to be
effective, provided, however, the COMPANY shall not be required to
contribute more than the amount deductible as an expense for
purposes of federal taxes on income.
11.07 SECTION 416 OF THE CODE AND ITS REGULATIONS
In the event that any or all of the Sections 11.01 (Definitions),
11.02 (Top Heavy Defined), 11.03 (Vesting Provisions), 11.04
(Minimum Benefits for Non-Key Employees) and 11.05 (Maximum Annual
Compensation) do not fully comply with Section 416 of the CODE and
the regulations issued thereunder, Section 416 of the CODE and its
regulations shall supersede and replace the Section of the PLAN
which is not in full compliance.
- 42 -
11.08 NO DUPLICATION OF BENEFITS
If the COMPANY maintains more than one qualified retirement plan,
the minimum contribution otherwise required by Section 11.04
(Minimum Benefit for Non-Key Employees) may be reduced in accordance
with regulations of the Secretary of the Treasury to prevent
inappropriate duplication of minimum contributions or benefits.
Article 12
INVESTMENT ADVISORY BOARD
-------------------------
12.01 MEMBERSHIP
An INVESTMENT ADVISORY BOARD consisting of such number of persons
(who may but need not be employees of the COMPANY) as determined by
the Chief Executive Officer of the COMPANY shall be appointed by the
Chief Executive Officer of the COMPANY. The Secretary of the
COMPANY shall certify to the TRUSTEE from time to time the
appointment to (and termination of) office of each member of the
INVESTMENT ADVISORY BOARD and the person who is selected as
secretary of the INVESTMENT ADVISORY BOARD.
12.02 GENERAL POWERS, RIGHTS AND DUTIES
Except as otherwise specifically provided and in addition to the
powers, rights and duties specifically given to the INVESTMENT
ADVISORY BOARD elsewhere in the PLAN and the TRUST, the INVESTMENT
ADVISORY BOARD shall have the following discretionary powers, rights
and duties:
(a) To select a secretary, if it believes it advisable, who may
but need not be a member of the INVESTMENT ADVISORY BOARD.
(b) To determine all questions arising under the PLAN, including
the power to determine the rights or eligibility of EMPLOYEES
or PARTICIPANTS and any other persons, and the amounts of
their benefits under the PLAN, and to remedy ambiguities,
inconsistencies or omissions.
(c) To adopt such rules of procedure and regulations as in its
opinion may be necessary for the proper and efficient
administration of the PLAN as are consistent with the PLAN and
TRUST.
(d) To enforce the PLAN in accordance with the terms of the PLAN
and the TRUST and the rules and regulations adopted by the
INVESTMENT ADVISORY BOARD as above.
(e) To direct the TRUSTEE as respects payments or distributions
from the TRUST FUND in accordance with the provisions of the
PLAN.
- 43 -
(f) To furnish the COMPANY with such information as may be
required by it for tax or other purposes in connection with
the PLAN.
(g) To employ agents, attorneys, accountants, actuaries or other
persons (who also may be employed by the COMPANY) and to
allocate or delegate to them such powers, rights and duties as
the INVESTMENT ADVISORY BOARD may consider necessary or
advisable to properly carry out administration of the PLAN,
provided that such allocation or delegation and the acceptance
thereof by such agents, attorneys, accountants, actuaries or
other persons, shall be in writing.
12.03 MANNER OF ACTION
During a period in which two or more members of the INVESTMENT
ADVISORY BOARD are acting, the following provisions apply where the
context admits:
(a) A member of the INVESTMENT ADVISORY BOARD by writing may
delegate any or all of his rights, powers, duties and
discretions to any other member, with the consent of the
latter.
(b) The members of the INVESTMENT ADVISORY BOARD may act by
meeting or by writing signed without meeting, and may sign any
document by signing one document or concurrent documents.
(c) An action or a decision (which may be taken without a meeting)
of a majority of the members of the INVESTMENT ADVISORY BOARD
as to a matter shall be as effective as if taken or made by
all members of the INVESTMENT ADVISORY BOARD.
(d) If, because of the number qualified to act, there is an even
division of opinion among the members of the INVESTMENT
ADVISORY BOARD as to a matter, a disinterested party selected
by the INVESTMENT ADVISORY BOARD shall decide the matter and
his decision shall control.
(e) Except as otherwise provided by law, no member of the
INVESTMENT ADVISORY BOARD shall be liable or responsible for
an act or omission of the other members of the INVESTMENT
ADVISORY BOARD in which the former has not concurred.
(f) The certificate of the secretary of the INVESTMENT ADVISORY
BOARD or of a majority of the members of the INVESTMENT
ADVISORY BOARD that the INVESTMENT ADVISORY BOARD has taken or
authorized any action shall be conclusive in favor of any
person relying on the certificate.
12.04 INTERESTED MEMBER
If a member of the INVESTMENT ADVISORY BOARD also is a PARTICIPANT
in the PLAN, he may not decide or determine any matter or question
concerning distributions of any kind to be made to him or the nature
or mode of settlement of his benefits unless such decision or
- 44 -
determination could be made by him under the PLAN if he were not
serving on the INVESTMENT ADVISORY BOARD.
12.05 RESIGNATION OR REMOVAL OF MEMBERS
A member of the INVESTMENT ADVISORY BOARD may be removed by the
Chief Executive Officer of the COMPANY at any time. A member of the
INVESTMENT ADVISORY BOARD may resign at any time. The Chief
Executive Officer of the COMPANY may fill any vacancy in the
membership of the INVESTMENT ADVISORY BOARD. The Chief Executive
Officer of the COMPANY shall give prompt written notice thereof to
the other members of the INVESTMENT ADVISORY BOARD. Until any such
vacancy is filled, the remaining members may exercise all of the
powers, rights and duties conferred on the INVESTMENT ADVISORY
BOARD.
12.06 EXPENSES
All costs, charges and expenses reasonably incurred by the
INVESTMENT ADVISORY BOARD will be paid from the Trust Fund or by the
COMPANY, as directed by the Investment Advisory Board. No
compensation will be paid to a member of the INVESTMENT ADVISORY
BOARD as such.
12.07 INFORMATION REQUIRED
Each person entitled to benefits under the PLAN must file with the
INVESTMENT ADVISORY BOARD from time to time in writing such person's
post office address and each change of post office address. Any
communication, statement or notice addressed to any person at the
last post office address filed with the INVESTMENT ADVISORY BOARD
will be binding upon such person for all purposes of the PLAN. Each
person entitled to benefits under the PLAN also shall furnish the
INVESTMENT ADVISORY BOARD with such documents, evidence, data or
information as the INVESTMENT ADVISORY BOARD considers necessary or
desirable for the purpose of administering the PLAN. The COMPANY
shall furnish the INVESTMENT ADVISORY BOARD with such data and
information as the INVESTMENT ADVISORY BOARD may deem necessary or
desirable in order to administer the PLAN. The records of the
COMPANY as to an EMPLOYEE'S or PARTICIPANT'S period of employment,
HOURS OF SERVICE, RESIGNATION/DISMISSAL and the reason therefore,
LEAVE OF ABSENCE, reemployment and ANNUAL BASE PAY will be
conclusive on all persons unless determined to the INVESTMENT
ADVISORY BOARD'S satisfaction to be incorrect.
12.08 UNIFORM RULES
The INVESTMENT ADVISORY BOARD shall administer the PLAN on a
reasonable and nondiscriminatory basis and shall apply uniform rules
to all persons similarly situated.
- 45 -
12.09 REVIEW OF BENEFIT DETERMINATIONS
The INVESTMENT ADVISORY BOARD will provide notice in writing to any
PARTICIPANT or BENEFICIARY whose claim for benefits under the PLAN
is denied and the INVESTMENT ADVISORY BOARD shall afford such
PARTICIPANT or BENEFICIARY a full and fair review of its decision if
so requested.
12.10 FINAL DECISION
Subject to applicable law, any interpretation of the provisions of
the PLAN and any decisions on any matter within the discretion of
the INVESTMENT ADVISORY BOARD made by the INVESTMENT ADVISORY BOARD
in good faith shall be binding on all persons. A misstatement or
other mistake of fact shall be corrected when it becomes known and
the INVESTMENT ADVISORY BOARD shall make such adjustment on account
thereof as it considers equitable and practicable.
- 46 -
EXHIBIT A
---------
FORMULA FOR DETERMINING COMPANY CONTRIBUTIONS UNDER
FORT HOWARD CORPORATION PROFIT SHARING RETIREMENT PLAN
------------------------------------------------------
1. Subject to the conditions and limitations set forth below, beginning
with the calendar year ending December 31, 1988, each year the
COMPANY shall contribute to the TRUSTEE an amount equal to ten
percent (10%) of its adjusted profits (as defined below) for such
year, subject always to the following limitations:
(a) The COMPANY CONTRIBUTION in accordance with the above FORMULA
shall in no event exceed an amount equal to ten percent (10%)
of the ANNUAL BASE PAY of PARTICIPANTS in the PLAN during such
year.
(b) The COMPANY CONTRIBUTION in accordance with the above FORMULA
shall in no event reduce its net profits (as defined below) to
less than an amount equal to six percent (6%) of the COMPANY'S
net worth (as defined below) as of the beginning of such year.
(c) If, in any year, beginning with the year 1951, the COMPANY
incurs a loss (as defined below), or its net profits are less
than an amount equal to six percent (6%) of the COMPANY's net
worth as of the beginning of such year, the amount of any such
loss plus the amount of any such deficiency in net profits
shall be carried forward and charged to net profits in the
next succeeding year or years, and the COMPANY shall not make
any COMPANY CONTRIBUTION in accordance with this FORMULA in
any succeeding year unless and until its net profits in such
year exceed the sum of:
(i) six percent (6%) of the COMPANY'S net worth as at the
beginning of that year, plus
(ii) the total of such accumulated losses and deficiencies
in net profits carried forward from the preceding year
or years and not charged to subsequent net profits as
above.
Notwithstanding the amount of the contribution, if any, determined
by application of the foregoing provisions of this paragraph, the
Company may pay to the TRUSTEE under the PLAN for any year such
amount or amounts as the Board of Directors of the Company may
determine by resolution. The resolution shall designate the plan
year on account of which the contribution is made. Such resolution,
whether adopted before or after the close of the Company's fiscal
year, shall specify the amount of the contribution or a definite
basis or formula by which the amount can be determined within a
reasonable time after the close of such year.
2. The term "adjusted profits" or "loss" as used above for any year
mean net income or net loss for such year determined according to
recognized accounting principles and practices except as follows:
- A-1 -
(a) Gains or losses on the sale or other disposition of capital
assets (such as land, buildings, machinery, etc.) or
securities (including treasury stock) held for investment
purposes shall be disregarded.
(b) The net proceeds from life insurance in excess of cash
surrender value recorded on the COMPANY'S books, and gains
from fires, condemnations, or other involuntary conversions
shall be disregarded.
(c) Reasonable reserves for renegotiation liability, as determined
by the COMPANY in accordance with recognized accounting
principles and practices, and reasonable reserves of a type or
character allowed or allowable as deductions for federal
income tax purposes shall be charged to such net income or
increase the amount of any net loss, but reserves for other
contingencies shall be disregarded.
(d) No deduction or allowance on account of federal or state
income and excess profits taxes shall be made.
(e) No account shall be taken of the COMPANY CONTRIBUTION under
the PLAN for that year.
(f) Any liability for renegotiation in excess of amounts charged
to prior net income shall be charged to net income or increase
the amount of any net loss, and any credit balance in any
reserve for renegotiation shall be added to net income or
reduce the amount of any net loss in the year when final
determination of the liability is made.
(g) Unless otherwise specifically provided for under (a) through
(f) above, any amount or amounts representing adjustments to
income which are charged directly to the surplus account
during that year shall be deducted from net income or increase
the amount of any net loss as otherwise determined for that
year.
3. The term "net profits" for any year as used above means adjusted
profits, as defined above, plus the amount of any refund received in
that year on account of overassessment of federal or state income
and excess profits taxes applicable to years subsequent to 1950,
less the sum of the following:
(a) any federal or state income and excess profits taxes accrued
for such year;
(b) any COMPANY CONTRIBUTIONS to the TRUSTEE for such year; and
(c) any deficiency paid in that year on account of federal or
state income and excess profits taxes for any year subsequent
to 1950.
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4. The term "net worth" as of any date means the sum of:
(a) The par or stated value of all issued and outstanding stock of
the COMPANY (excluding treasury stock);
(b) paid-in or capital surplus, excluding surplus arising from
revaluation of assets;
(c) earned surplus and undivided profits; and
(d) reserves for contingencies (other than reserves for bad debts,
depreciation, renegotiation, discounts, self-insurance,
replacement of inventories, and similar items of a specific
nature); all as determined in accordance with recognized
accounting principles and practices.
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