EXHIBIT 4.1
ADOPTION AGREEMENT #005
NONSTANDARDIZED CODE SECTION 401(k) PROFIT SHARING PLAN
The undersigned, Regal-Beloit Corporation ("Employer"), by executing this
Adoption Agreement, elects to become a participating Employer in the Marshall &
Ilsley Trust Company Defined Contribution Master Plan (basic plan document #01)
by adopting the accompanying Plan and Trust in full as if the Employer were a
signatory to that Agreement. The Employer makes the following elections granted
under the provisions of the Master Plan.
ARTICLE I
DEFINITIONS
1.02 TRUSTEE. The Trustee executing this Adoption Agreement is:
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(Choose (a) or (b))
[X] (a) A discretionary Trustee. See Section 10.03[A] of the Plan.
[ ] (b) A nondiscretionary Trustee. See Section 10.03[B] of the Plan.
[Note: The Employer may not elect Option (b) if a Custodian executes the
Adoption Agreement.]
1.03 PLAN. The name of the Plan as adopted by the Employer is Regal-Beloit
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Corporation Savings and Protection Plan.
1.07 EMPLOYEE. The following Employees are not eligible to participate in
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the Plan: (Choose (a) or at least one of (b) through (g))
[ ] (a) No exclusions.
[ ] (b) Collective bargaining employees (as defined in Section 1.07 of the
Plan). [Note: If the Employer excludes union employees from the Plan,
the Employer must be able to provide evidence that retirement benefits
were the subject of good faith bargaining.]
[ ] (c) Nonresident aliens who do not receive any earned income (as defined
in Code Section 911(d)(2)) from the Employer which constitutes United
States source income (as defined in Code Section 861(a)(3)).
[ ] (d) Commission Salesmen.
[ ] (e) Any Employee compensated on a salaried basis.
[ ] (f) Any Employee compensated on an hourly basis.
[X] (g) (Specify) all employees other than union employees of the Foote-
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Jones Division and the Velvet Drive Transmissions Division (whose
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collective bargaining agreement provides for participation hereunder).
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Leased Employees. Any Leased Employee treated as an Employee under Section
1.31 of the Plan, is: (Choose (h) or (i))
[X] (h) Not eligible to participate in the Plan.
[ ] (i) Eligible to participate in the Plan, unless excluded by reason
of an exclusion classification elected under this Adoption Agreement
Section 1.07.
Related Employers. If any member of the Employer's related group (as defined
in Section 1.30 of the Plan) executes a Participation Agreement to this
Adoption Agreement, such member's Employees are eligible to participate in
this Plan, unless excluded by reason of an exclusion classification elected
under this Adoption Agreement Section 1.07. In addition: (Choose (j) or (k))
[X] (j) No other related group member's Employees are eligible to
participate in the Plan.
[ ] (k) The following nonparticipating related group member's Employees
are eligible to participate in the Plan unless excluded by reason
of an exclusion classification elected under this Adoption Agreement
Section 1.07:__________________________________________.
1.12 COMPENSATION.
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Treatment of elective contributions. (Choose (a) or (b))
[X] (a) "Compensation" includes elective contributions made by the
Employer on the Employee's behalf.
[ ] (b) "Compensation" does not include elective contributions.
Modifications to Compensation definition. (Choose (c) or at least one of
(d) through (j))
[ ] (c) No modifications other than as elected under Options (a) or (b).
[ ] (d) The Plan excludes Compensation in excess of $__________________
___________________.
[X] (e) In lieu of the definition in Section 1.12 of the Plan,
Compensation means any earnings reportable as W-2 wages for Federal
income tax withholding purposes, subject to any other election under
this Adoption Agreement Section 1.12.
[ ] (f) The Plan excludes bonuses.
[ ] (g) The Plan excludes overtime.
[ ] (h) The Plan excludes Commissions.
[ ] (i) Compensation will not include Compensation from a related
employer (as defined in Section 1.30 of the Plan) that has not
executed a Participation Agreement in this Plan unless, pursuant
to Adoption Agreement Section 1.07, the Employees of that
related employer are eligible to participate in this Plan.
[ ] (j) (Specify) ___________________________________________________.
If, for any Plan Year, the Plan uses permitted disparity in the contribution
or allocation formula elected under Article III, any election of Options
(f), (g), (h) or (j) is ineffective for such Plan Year with respect to any
Nonhighly Compensated Employee.
Special definition for matching contributions. "Compensation" for purposes
of any matching contribution formula under Article III means: (Choose (k)
or (l) only if applicable)
[ ] (k) Compensation as defined in this Adoption Agreement Section 1.12.
[ ] (l) (Specify) _____________________________________________________.
Special definition for salary reduction contributions. An Employee's salary
reduction agreement applies to his Compensation determined prior to the
reduction authorized by that salary reduction agreement, with the following
exceptions: (Choose (m) or at least one of (n) or (o), if applicable)
[X] (m) No exceptions.
[ ] (n) If the Employee makes elective contributions to another plan
maintained by the Employer, the Advisory Committee will determine
the amount of the Employee's salary reduction contribution for the
withholding period: (Choose (1) or (2))
[ ] (1) After the reduction for such period of elective
contributions to the other plan(s).
[ ] (2) Prior to the reduction for such period of elective
contributions to the other plan(s).
[ ] (o) (Specify) _________________________________________________.
1.17 PLAN YEAR/LIMITATION YEAR.
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Plan Year. Plan Year means: (Choose (a) or (b))
[X] (a) The 12 consecutive month period ending every December 31.
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[ ] (b) (Specify) _________________________________________________.
Limitation Year. The Limitation Year is: (Choose (c) or (d))
[X] (c) The Plan Year.
[ ] (d) The 12 consecutive month period ending every _____.
1.18 EFFECTIVE DATE.
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New Plan. The "Effective Date" of the Plan is ______.
Restated Plan. The restated Effective Date is February 1, 1998.
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This Plan is a substitution and amendment of an existing retirement
plan(s) originally established October 1, 1987. [Note: See the Effective Date
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Addendum.]
1.27 HOUR OF SERVICE. The crediting method for Hours of Service is:
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(Choose (a) or (b))
[X] (a) The actual method.
[ ] (b) The __________ equivalency method, except:
[ ] (1) No exceptions.
[ ] (2) The actual method applies for purposes of: (Choose at
least one)
[ ] (i) Participation under Article II.
[ ] (ii) Vesting under Article V.
[ ] (iii) Accrual of benefits under Section 3.06.
[Note: On the blank line, insert "daily," "weekly," "semi-monthly payroll
periods" or "monthly."]
1.29 SERVICE FOR PREDECESSOR EMPLOYER. In addition to the predecessor
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service the Plan must credit by reason of Section 1.29 of the Plan, the
Plan credits Service with the following predecessor employer(s): n/a.
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Service with the designated predecessor employer(s) applies: (Choose at
least one of (a) or (b); (c) is available only in addition to (a) or (b))
[ ] (a) For purposes of participation under Article II.
[ ] (b) For purposes of vesting under Article V.
[ ] (c) Except the following Service: ______________________________.
[Note: If the Plan does not credit any predecessor service under this
provision, insert "N/A" in the first blank line. The Employer may attach a
schedule to this Adoption Agreement, in the same format as this Section 1.29,
designating additional predecessor employers and the applicable service
crediting elections.]
1.31 LEASED EMPLOYEES. If a Leased Employee is a Participant in the
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Plan and also participates in a plan maintained by the leasing
organization: (Choose (a) or (b))
[ ] (a) The Advisory Committee will determine the Leased Employee's
allocation of Employer contributions under Article III without
taking into account the Leased Employee's allocation, if any, under
the leasing organization's plan.
[X] (b) The Advisory Committee will reduce a Leased Employee's
allocation of Employer nonelective contributions (other than
designated qualified nonelective contributions) under this Plan
by the Leased Employee's allocation under the leasing organization's
plan, but only to the extent that allocation is attributable to the
Leased Employee's service provided to the Employer. The leasing
organization's plan:
[X] (1) Must be a money purchase plan which would satisfy the
definition under Section 1.31 of a safe harbor plan,
irrespective of whether the safe harbor exception applies.
[ ] (2) Must satisfy the features and, if a defined benefit
plan, the method of reduction described in an addendum to this
Adoption Agreement, numbered 1.31.
ARTICLE II
EMPLOYEE PARTICIPANTS
2.01 ELIGIBILITY.
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Eligibility conditions. To become a Participant in the Plan, an Employee
must satisfy the following eligibility conditions: (Choose (a) or (b) or
both; (c) is optional as an additional election)
[X] (a) Attainment of age 18 (specify age, not exceeding 21).
[X] (b) Service requirement. (Choose one of (1) through (3))
[ ] (1) One Year of Service.
[X] (2) 6 months (not exceeding 12) following the Employee's
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Employment Commencement Date.
[ ] (3) One Hour of Service.
[X] (c) Special requirements for non-401(k) portion of plan. (Make
elections under (1) and under (2))
(1) The requirements of this Option (c) apply to participation
in: (Choose at least one of (i) through (iii))
[X] (i) The allocation of Employer nonelective contributions
and Participant forfeitures.
[ ] (ii) The allocation of Employer matching contributions
(including forfeitures allocated as matching
contributions).
[ ] (iii) The allocation of Employer qualified nonelective
contributions.
(2) For participation in the allocations described in (1),
the eligibility conditions are: (Choose at least one of
(i) through (iv))
[X] (i) For union employees of the Foote - Jones Division,
one-half year of continuous service defined as 500
hours of service, of for all eligible employees 1
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(one or two) Year(s) of Service, without an intervening
Break in Service (as described in Section 2.03(A) of
the Plan) if the requirement is two Years of Service.
[ ] (ii) (not exceeding 24) following the Employee's
Employment Commencement Date.
[ ] (iii) One Hour of Service.
[ ] (iv) Attainment of age _____ (Specify age, not
exceeding 21).
Plan Entry Date. "Plan Entry Date" means the Effective Date and: (Choose
(d), (e) or (f))
[X] (d) Semi-annual Entry Dates. The first day of the Plan Year and
the first day of the seventh month of the Plan Year.
[ ] (e) The first day of the Plan Year.
[ ] (f) (Specify entry dates) ______________________________________.
Time of Participation. An Employee will become a Participant (and, if
applicable, will participate in the allocations described in Option
(c)(1)), unless excluded under Adoption Agreement Section 1.07, on the
Plan Entry Date (if employed on that date): (Choose (g), (h) or (i))
[X] (g) immediately following
[ ] (h) immediately preceding
[ ] (i) nearest
the date the Employee completes the eligibility conditions described in
Options (a) and (b) (or in Option (c)(2) if applicable) of this Adoption
Agreement Section 2.01. [Note: The Employer must coordinate the
selection of (g), (h) or (i) with the "Plan Entry Date" selection in (d),
(e) or (f). Unless otherwise excluded under Section 1.07, the Employee
must become a Participant by the earlier of: (1) the first day of the Plan
Year beginning after the date the Employee completes the age and service
requirements of Code Section 410(a); or (2) 6 months after the date the
Employee completes those requirements.]
Dual eligibility. The eligibility conditions of this Section 2.01 apply
to: (Choose (j) or (k))
[X] (j) All Employees of the Employer, except: (Choose (1) or (2))
[ ] (1) No exceptions.
[X] (2) Employees who are Participants in the Plan as of the
Effective Date.
[ ] (k) Solely to an Employee employed by the Employer after ______.
If the Employee was employed by the Employer on or before the
specified date, the Employee will become a Participant: (Choose
(1), (2) or (3))
[ ] (1) On the latest of the Effective Date, his Employment
Commencement Date or the date he attains age _____ (not to
exceed 21).
[ ] (2) Under the eligibility conditions in effect under the Plan
prior to the restated Effective Date. If the restated Plan
required more than one Year of Service to participate, the
eligibility condition under this Option (2) for participation
in the Code Section 401(k) arrangement under this Plan is one
Year of Service for Plan Years beginning after December 31, 1988.
[For restated plans only]
[ ] (3) (Specify) ____________________________________________.
2.02 YEAR OF SERVICE - PARTICIPATION.
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Hours of Service. An Employee must complete: (Choose (a) or (b))
[X] (a) 1,000 Hours of Service
[ ] (b) ________ Hours of Service
during an eligibility computation period to receive credit for a Year of
Service. [ Note: The Hours of Service requirement may not exceed 1,000.]
Eligibility computation period. After the initial eligibility computation
period described in Section 2.02 of the Plan, the Plan measures the
eligibility computation period as: (Choose (c) or (d))
[ ] (c) The 12 consecutive month period beginning with each anniversary
of an Employee's Employment Commencement Date.
[X] (d) The Plan Year, beginning with the Plan Year which includes the
first anniversary of the Employee's Employment Commencement Date.
2.03 BREAK IN SERVICE - PARTICIPATION. The Break in Service rule
described in Section 2.03(B) of the Plan: (Choose (a) or (b))
[X] (a) Does not apply to the Employer's Plan.
[ ] (b) Applies to the Employer's Plan.
2.06 ELECTION NOT TO PARTICIPATE. The Plan: (Choose (a) or (b))
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[X] (a) Does not permit an eligible Employee or a Participant to elect not
to participate.
[ ] (b) Does permit an eligible Employee or a Participant to elect not to
participate in accordance with Section 2.06 and with the following
rules: (Complete (1), (2), (3) and (4))
(1) An election is effective for a Plan Year if filed no later
than __________________________________.
(2) An election not to participate must be effective for at
least ____________ Plan Year(s).
(3) Following a re-election to participate, the Employee or
Participant:
[ ] (i) May not again elect not to participate for any
subsequent Plan Year.
[ ] (ii) May again elect not to participate, but not earlier
than the ________ Plan Year following the Plan Year in
which the re-election first was effective.
(4) (Specify) ________________________________________________
[Insert "N/A" if no other rules apply].
ARTICLE III
EMPLOYER CONTRIBUTIONS AND FORFEITURES
3.01 AMOUNT.
Part I. [Options (a) through (g)] Amount of Employer's contribution.
The Employer's annual contribution to the Trust will equal the total
amount of deferral contributions, matching contributions, qualified
nonelective contributions and nonelective contributions, as determined
under this Section 3.01. (Choose any combination of (a), (b), (c) and
(d), or choose (e))
[X] (a) Deferral contributions (Code Section 401(k) arrangement). (Choose (1)
or (2) or both)
[X] (1) Salary reduction arrangement. The Employer must contribute
the amount by which the Participants have reduced their
Compensation for the Plan Year, pursuant to their salary
reduction agreements on file with the Advisory Committee.
A reference in the Plan to salary reduction contributions is a
reference to these amounts.
[ ] (2) Cash or deferred arrangement. The Employer will contribute
on behalf of each Participant the portion of the Participant's
proportionate share of the cash or deferred contribution which he
has not elected to receive in cash. See Section 14.02 of the
Plan. The Employer's cash or deferred contribution is the amount
the Employer may from time to time deem advisable which the
Employer designates as a cash or deferred contribution prior to
making that contribution to the Trust.
[ ] (b) Matching contributions. The Employer will make matching contributions
in accordance with the formula(s) elected in Part II of this Adoption
Agreement Section 3.01.
[X] (c) Designated qualified nonelective contributions. The Employer, in
its sole discretion, may contribute an amount which it designates as
a qualified nonelective contribution.
[X] (d) Nonelective contributions. (Choose any combination of (1) through (4))
[X] (1) Discretionary contribution. The amount (or additional
amount) the Employer may from time to time deem advisable.
[ ] (2) The amount (or additional amount) the Employer may from time
to time deem advisable, separately determined for each of the
following classifications of Participants: (Choose (i) or (ii))
[ ] (i) Nonhighly Compensated Employees and Highly Compensated
Employees.
[ ] (ii) (Specify classifications) ____________________________.
Under this Option (2), the Advisory Committee will allocate the
amount contributed for each Participant classification in
accordance with Part II of Adoption Agreement Section 3.04, as
if the Participants in that classification were the only
Participants in the Plan.
[ ] (3) _____% of the Compensation of all Participants under the
Plan, determined for the Employer's taxable year for which it
makes the contribution. [Note: The percentage selected may
not exceed 15%.]
[ ] (4) _____% of Net Profits but not more than $__________.
[ ] (e) Frozen Plan. This Plan is a frozen Plan effective _______.
The Employer will not contribute to the Plan with respect to any
period following the stated date.
Net Profits. The Employer: (Choose (f) or (g))
[ ] (f) Need not have Net Profits to make its annual contribution under
this Plan.
[X] (g) Must have current or accumulated Net Profits exceeding $0 to make
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the following contributions: (Choose at least one)
[ ] (1) Cash or deferred contributions described in Option (a)(2).
[ ] (2) Matching contributions described in Option (b), except:
___________________________________________.
[ ] (3) Qualified nonelective contributions described in Option (c).
[X] (4) Nonelective contributions described in Option (d).
The term "Net Profits" means the Employer's net income or profits for any
taxable year determined by the Employer upon the basis of its books of
account in accordance with generally accepted accounting practices
consistently applied without any deductions for Federal and state
taxes upon income or for contributions made by the Employer under this
Plan or under any other employee benefit plan the Employer maintains.
The term "Net Profits" specifically excludes N/A. [Note: Enter "N/A"
if no exclusions apply.]
If the Employer requires Net Profits for matching contributions and the
Employer does not have sufficient Net Profits under Option (g), it will
reduce the matching contribution under a fixed formula on a prorata basis
for all Participants. A Participant's share of the reduced contribution
will bear the same ratio as the matching contribution the Participant
would have received if Net Profits were sufficient bears to the total
matching contribution all Participants would have received if Net Profits
were sufficient. If more than one member of a related group (as defined
in Section 1.30) execute this Adoption Agreement, each participating
member will determine Net Profits separately but will not apply this
reduction unless, after combining the separately determined Net Profits,
the aggregate Net Profits are insufficient to satisfy the matching
contribution liability. "Net Profits" includes both current and
accumulated Net Profits.
Part II. [Options (h) through (j)] Matching contribution formula.
[Note: If the Employer elected Option (b), complete Options (h), (i)
and (j).]
[ ] (h) Amount of matching contributions. For each Plan Year, the
Employer's matching contribution is: (Choose any combination of
(1), (2), (3), (4) and (5))
[ ] (1) An amount equal to _____% of each Participant's eligible
contributions for the Plan Year.
[ ] (2) An amount equal to _____% of each Participant's first tier
of eligible contributions for the Plan Year, plus the
following matching percentage(s) for the following subsequent
tiers of eligible contributions for the Plan__________________
_______________________.
[ ] (3) Discretionary formula.
[ ] (i) An amount (or additional amount) equal to a matching
percentage the Employer from time to time may deem
advisable of the Participant's eligible contributions for
the Plan Year.
[ ] (ii) An amount (or additional amount) equal to a matching
percentage the Employer from time to time may deem
advisable of each tier of the Participant's eligible
contributions for the Plan Year.
[ ] (4) An amount equal to the following percentage of each
Participant's eligible contributions for the Plan Year, based
on the Participant's Years of Service:
Number of Years of Service Matching Percentage
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_____ _____%
_____ _____%
_____ _____%
_____ _____%
The Advisory Committee will apply this formula by determining
Years of Service as follows: __________________________________.
[ ] (5) A Participant's matching contributions may not: (Choose (i)
or (ii))
[ ] (i) Exceed _________________________________________________.
[ ] (ii) Be less than ___________________________________________.
Related Employers. If two or more related employers (as defined in
Section 1.30) contribute to this Plan, the related employers may
elect different matching contribution formulas by attaching to the
Adoption Agreement a separately completed copy of this Part II.
Note: Separate matching contribution formulas create separate current
benefit structures that must satisfy the minimum participation test
of Code Section 401(a)(26).]
[ ] (i) Definition of eligible contributions. Subject to the requirements
of Option (j), the term "eligible contributions" means: (Choose any
combination of (1) through (3))
[ ] (1) Salary reduction contributions.
[ ] (2) Cash or deferred contributions (including any part of the
Participant's proportionate share of the cash or deferred
contribution which the Employer defers without the
Participant's election).
[ ] (3) Participant mandatory contributions, as designated in
Adoption Agreement Section 4.01. See Section 14.04 of the Plan.
[ ] (j) Amount of eligible contributions taken into account. When
determining a Participant's eligible contributions taken into
account under the matching contributions formula(s), the following
rules apply: (Choose any combination of (1) through (4))
[ ] (1) The Advisory Committee will take into account all eligible
contributions credited for the Plan Year.
[ ] (2) The Advisory Committee will disregard eligible contributions
exceeding ______________________________________________________.
[ ] (3) The Advisory Committee will treat as the first tier of
eligible contributions, an amount not exceeding: ________________
___________________________________.
The subsequent tiers of eligible contributions are: _____________
___________________________________.
[ ] (4) (Specify) ___________________________________________________.
Part III. [Options (k) and (l)]. Special rules for Code Section 401(k)
Arrangement. (Choose (k) or (l), or both, as applicable)
[X] (k) Salary Reduction Agreements. The following rules and
restrictions apply to an Employee's salary reduction agreement: (Make
a selection under (1), (2), (3) and (4))
(1) Limitation on amount. The Employee's salary reduction
contributions: (Choose (i) or at least one of (ii) or (iii))
[ ] (i) No maximum limitation other than as provided in
the Plan.
[X] (ii) May not exceed 20% of Compensation for the Plan
Year, subject to the annual additions limitation
described in Part 2 of Article III and the 402(g)
limitation described in Section 14.07 of the Plan.
[X] (iii) Based on percentages of Compensation must equal
at least 1% of compensation.
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(2) An Employee may revoke, on a prospective basis, a
salary reduction agreement: (Choose (i), (ii), (iii) or (iv))
[ ] (i) Once during any Plan Year but not later than _______
______________________________ of the Plan Year.
[ ] (ii) As of any Plan Entry Date.
[ ] (iii) As of the first day of any month.
[X] (iv) (Specify, but must be at least once per Plan Year)
at such times as the Employer may determine.
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(3) An Employee who revokes his salary reduction agreement
may file a new salary reduction agreement with an effective
date: (Choose (i), (ii), (iii) or (iv))
[ ] (i) No earlier than the first day of the next Plan Year.
[ ] (ii) As of any subsequent Plan Entry Date.
[ ] (iii) As of the first day of any month subsequent to the
month in which he revoked an Agreement.
[X] (iv) (Specify, but must be at least once per Plan Year
following the Plan Year of revocation) at such times as the
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Employer may determine.
----------------------
(4) A Participant may increase or may decrease, on a
prospective basis, his salary reduction percentage or dollar
amount: (Choose (i), (ii), (iii) or (iv))
[ ] (i) As of the beginning of each payroll period.
[ ] (ii) As of the first day of each month.
[ ] (iii) As of any Plan Entry Date.
[x] (iv) (Specify, but must permit an increase or a decrease
at least once per Plan Year) at such times as the Empolyer
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may determine.
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[ ] (l) Cash or deferred contributions. For each Plan Year for which the
Employer makes a designated cash or deferred contribution, a
Participant may elect to receive directly in cash not more than
the following portion (or, if less, the 402(g) limitation described
in Section 14.07 of the Plan) of his proportionate share of that
cash or deferred contribution: (Choose (1) or (2))
[ ] (1) All or any portion.
[ ] (2) ______________________________________%.
3.04 CONTRIBUTION ALLOCATION. The Advisory Committee will allocate
deferral contributions, matching contributions, qualified nonelective
contributions and nonelective contributions in accordance with Section
14.06 and the elections under this Adoption Agreement Section 3.04.
Part I. [Options (a) through (d)]. Special Accounting Elections.
(Choose whichever elections are applicable to the Employer's Plan)
[ ] (a) Matching Contributions Account. The Advisory Committee will
allocate matching contributions to a Participant's: (Choose (1) or (2);
(3) is available only in addition to (1))
[ ] (1) Regular Matching Contributions Account.
[ ] (2) Qualified Matching Contributions Account.
[ ] (3) Except, matching contributions under Option(s) __________
of Adoption Agreement Section 3.01 are allocable to the
Qualified Matching Contributions Account.
[X] (b) Special Allocation Dates for Salary Reduction Contributions.
The Advisory Committee will allocate salary reduction contributions as
of the Accounting Date and as of the following additional allocation
dates: each day contributions are received by the Trustee.
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[ ] (c) Special Allocation Dates for Matching Contributions. The Advisory
Committee will allocate matching contributions as of the Accounting
Date and as of the following additional allocation dates: ____________.
[X] (d) Designated Qualified Nonelective Contributions - Definition of
Participant. For purposes of allocating the designated qualified
nonelective contribution, "Participant" means: (Choose (1), (2) or (3))
[ ] (1) All Participants.
[X] (2) Participants who are Nonhighly Compensated Employees for the
Plan Year.
[ ] (3) (Specify) __________________________________________________.
Part II. Method of Allocation - Nonelective Contribution. Subject to any
restoration allocation required under Section 5.04, the Advisory Committee
will allocate and credit each annual nonelective contribution (and
Participant forfeitures treated as nonelective contributions) to the
Employer Contributions Account of each Participant who satisfies the
conditions of Section 3.06, in accordance with the allocation method
selected under this Section 3.04. If the Employer elects Option (e)(2),
Option (g)(2) or Option (h), for the first 3% of Compensation allocated
to all Participants, "Compensation" does not include any exclusions elected
under Adoption Agreement Section 1.12 (other than the exclusion of elective
contributions), and the Advisory Committee must take into account the
Participant's Compensation for the entire Plan Year. (Choose an allocation
method under (e), (f), (g) or (h); (i) is mandatory if the Employer elects
(f), (g) or (h); (j) is optional in addition to any other election.)
[X] (e) Nonintegrated Allocation Formula. (Choose (1) or (2))
[X] (1) The Advisory Committee will allocate the annual nonelective
contributions in the same ratio that each Participant's
Compensation for the Plan Year bears to the total Compensation
of all Participants for the Plan Year.
[ ] (2) The Advisory Committee will allocate the annual nonelective
contributions in the same ratio that each Participant's
Compensation for the Plan Year bears to the total Compensation
of all Participants for the Plan Year. For purposes of this
Option (2), "Participant" means, in addition to a Participant
who satisfies the requirements of Section 3.06 for the Plan
Year, any other Participant entitled to a top heavy minimum
allocation under Section 3.04(B), but such Participant's alloca-
tion will not exceed 3% of his Compensation for the Plan Year.
[ ] (f) Two-Tiered Integrated Allocation Formula - Maximum Disparity.
First, the Advisory Committee will allocate the annual Employer nonelective
contributions in the same ratio that each Participant's Compensation plus
Excess Compensation for the Plan Year bears to the total Compensation plus
Excess Compensation of all Participants for the Plan Year. The allocation
under this paragraph, as a percentage of each Participant's Compensation
plus Excess Compensation, must not exceed the applicable percentage (5.7%,
5.4% or 4.3%) listed under the Maximum Disparity Table following Option (i).
The Advisory Committee then will allocate any remaining nonelective
contributions in the same ratio that each Participant's Compensation for
the Plan Year bears to the total Compensation of all Participants for the
Plan Year.
[ ] (g) Three-Tiered Integrated Allocation Formula. First, the Advisory
Committee will allocate the annual Employer nonelective contributions
in the same ratio that each Participant's Compensation for the Plan
Year bears to the total Compensation of all Participants for the
Plan Year. The allocation under this paragraph, as a percentage of
each Participant's Compensation may not exceed the applicable
percentage (5.7%, 5.4% or 4.3%) listed under the Maximum Disparity
Table following Option (i). Solely for purposes of the allocation
in this first paragraph, "Participant" means, in addition to a
Participant who satisfies the requirements of Section 3.06 for the
Plan Year: (Choose (1) or (2))
[ ] (1) No other Participant.
[ ] (2) Any other Participant entitled to a top heavy minimum
allocation under Section 3.04(B), but such Participant's
allocation under this Option (g) will not exceed 3% of his
Compensation for the Plan Year.
As a second tier allocation, the Advisory Committee will allocate
the nonelective contributions in the same ratio that each
Participant's Excess Compensation for the Plan Year bears to the
total Excess Compensation of all Participants for the Plan Year.
The allocation under this paragraph, as a percentage of each
Participant's Excess Compensation, may not exceed the allocation
percentage in the first paragraph.
Finally, the Advisory Committee will allocate any remaining
nonelective contributions in the same ratio that each Participant's
Compensation for the Plan Year bears to the total Compensation of
all Participants for the Plan Year.
[ ] (h) Four-Tiered Integrated Allocation Formula. First, the Advisory
Committee will allocate the annual Employer nonelective contributions
in the same ratio that each Participant's Compensation for the Plan
Year bears to the total Compensation of all Participants for the
Plan Year, but not exceeding 3% of each Participant's Compensation
Solely for purposes of this first tier allocation, a "Participant"
means, in addition to any Participant who satisfies the requirements
of Section 3.06 for the Plan Year, any other Participant entitled to
a top heavy minimum allocation under Section 3.04(B) of the Plan.
As a second tier allocation, the Advisory Committee will allocate the
nonelective contributions in the same ratio that each Participant's
Excess Compensation for the Plan Year bears to the total Excess
Compensation of all Participants for the Plan Year, but not exceeding
3% of each Participant's Excess Compensation.
As a third tier allocation, the Advisory Committee will allocate
the annual Employer contributions in the same ratio that each
Participant's Compensation plus Excess Compensation for the Plan
Year bears to the total Compensation plus Excess Compensation of all
Participants for the Plan Year. The allocation under this paragraph,
as a percentage of each Participant's Compensation plus Excess
Compensation, must not exceed the applicable percentage (2.7%, 2.4%
or 1.3%) listed under the Maximum Disparity Table following Option (i).
The Advisory Committee then will allocate any remaining nonelective
contributions in the same ratio that each Participant's Compensation
for the Plan Year bears to the total Compensation of all Participants
for the Plan Year.
[ ] (i) Excess Compensation. For purposes of Option (f), (g) or (h),
"Excess Compensation" means Compensation in excess of the following
Integration Level: (Choose (1) or (2))
[ ] (1) _____% (not exceeding 100%) of the taxable wage base, as
determined under Section 230 of the Social Security Act, in
effect on the first day of the Plan Year: (Choose any
combination of (i) and (ii) or choose (iii))
[ ] (i) Rounded to _____________________________________
(but not exceeding the taxable wage base).
[ ] (ii) But not greater than $__________________________.
[ ] (iii) Without any further adjustment or limitation.
[ ] (2) $_____________________________________________ [Note: Not
exceeding the taxable wage base for the Plan Year in which
this Adoption Agreement first is effective.]
Maximum Disparity Table. For purposes of Options (f), (g) and (h), the
applicable percentage is:
Applicable Applicable
Percentages for Percentages
Integration Level for Option (f) for
(as percentage of taxable wage base) or Option (g) Option (h)
- ------------------------------------ -------------- -----------
100% 5.7% 2.7%
More than 80% but less than 100% 5.4% 2.4%
More than 20% (but not less than $10,001)
and not more than 80% 4.3% 1.3%
20% (or $10,000, if greater) or less 5.7% 2.7%
[ ] (j) Allocation offset. The Advisory Committee will reduce a
Participant's allocation otherwise made under Part II of this Section
3.04 by the Participant's allocation under the following qualified
plan(s) maintained by the Employer: __________________________________.
The Advisory Committee will determine this allocation reduction:
(Choose (1) or (2))
[ ] (1) By treating the term "nonelective contribution" as including
all amounts paid or accrued by the Employer during the Plan
Year to the qualified plan(s) referenced under this Option (j).
If a Participant under this Plan also participates in that
other plan, the Advisory Committee will treat the amount the
Employer contributes for or during a Plan Year on behalf of a
particular Participant under such other plan as an amount
allocated under this Plan to that Participant's Account for
that Plan Year. The Advisory Committee will make the
computation of allocation required under the immediately
preceding sentence before making any allocation of nonelective
contributions under this Section 3.04.
[ ] (2) In accordance with the formula provided in an addendum to
this Adoption Agreement, numbered 3.04(j).
Top Heavy Minimum Allocation - Method of Compliance. If a Participant's
allocation under this Section 3.04 is less than the top heavy minimum
allocation to which he is entitled under Section 3.04(B): (Choose (k) or (l))
[X] (k) The Employer will make any necessary additional contribution to
the Participant's Account, as described in Section 3.04(B)(7)(a) of
the Plan.
[ ] (l) The Employer will satisfy the top heavy minimum allocation under
the following plan(s) it maintains: However, the
----------------
Employer will make any necessary additional contribution to satisfy the top
heavy minimum allocation for an Employee covered only under this
Plan and not under the other plan(s) designated in this Option (l).
See Section 3.04(B)(7)(b) of the Plan.
If the Employer maintains another plan, the Employer may provide in an
addendum to this Adoption Agreement, numbered Section 3.04, any
modifications to the Plan necessary to satisfy the top heavy requirements
under Code Section 416.
Related employers. If two or more related employers (as defined in
Section 1.30) contribute to this Plan, the Advisory Committee must
allocate all Employer nonelective contributions (and forfeitures treated
as nonelective contributions) to each Participant in the Plan, in
accordance with the elections in this Adoption Agreement Section 3.04:
(Choose (m) or (n))
[X] (m) Without regard to which contributing related group member employs
the Participant.
[ ] (n) Only to the Participants directly employed by the contributing
Employer. If a Participant receives Compensation from more than one
contributing Employer, the Advisory Committee will determine the
allocations under this Adoption Agreement Section 3.04 by prorating
among the participating Employers the Participant's Compensation and,
if applicable, the Participant's Integration Level under Option (i).
3.05 FORFEITURE ALLOCATION. Subject to any restoration allocation
required under Sections 5.04 or 9.14, the Advisory Committee will
allocate a Participant forfeiture in accordance with Section 3.04: (Choose
(a) or (b); (c) and (d) are optional in addition to (a) or (b))
[ ] (a) As an Employer nonelective contribution for the Plan Year in which
the forfeiture occurs, as if the Participant forfeiture were an
additional nonelective contribution for that Plan Year.
[X] (b) To reduce the Employer matching contributions and nonelective
contributions for the Plan Year: (Choose (1) or (2))
[ ] (1) in which the forfeiture occurs.
[X] (2) immediately following the Plan Year in which the forfeiture
occurs.
[ ] (c) To the extent attributable to matching contributions: (Choose (1),
(2) or (3))
[ ] (1) In the manner elected under Options (a) or (b).
[ ] (2) First to reduce Employer matching contributions for the
Plan Year: (Choose (i) or (ii))
[ ] (i) in which the forfeiture occurs,
[ ] (ii) immediately following the Plan Year in which the
forfeiture occurs, then as elected in Options (a) or (b).
[ ] (3) As a discretionary matching contribution for the Plan Year
in which the forfeiture occurs, in lieu of the manner elected
under Options (a) or (b).
[ ] (d) First to reduce the Plan's ordinary and necessary administrative
expenses for the Plan Year and then will allocate any remaining
forfeitures in the manner described in Options (a), (b) or (c),
whichever applies. If the Employer elects Option (c), the
forfeitures used to reduce Plan expenses: (Choose (1) or (2))
[ ] (1) relate proportionately to forfeitures described in Option (c)
and to forfeitures described in Options (a) or (b).
[ ] (2) relate first to forfeitures described in Option _____.
Allocation of forfeited excess aggregate contributions. The Advisory
Committee will allocate any forfeited excess aggregate contributions (as
described in Section 14.09): (Choose (e), (f) or (g))
[ ] (e) To reduce Employer matching contributions for the Plan Year:
(Choose (1) or (2))
[ ] (1) in which the forfeiture occurs.
[ ] (2) immediately following the Plan Year in which the
forfeiture occurs.
[ ] (f) As Employer discretionary matching contributions for the Plan
Year in which forfeited, except the Advisory Committee will not allocate
these forfeitures to the Highly Compensated Employees who incurred the
forfeitures.
[ ] (g) In accordance with Options (a) through (d), whichever applies,
except the Advisory Committee will not allocate these forfeitures
under Option (a) or under Option (c)(3) to the Highly Compensated
Employees who incurred the forfeitures.
3.06 ACCRUAL OF BENEFIT.
------------------
Compensation taken into account. For the Plan Year in which the
Employee first becomes a Participant, the Advisory Committee will
determine the allocation of any cash or deferred contribution,
designated qualified nonelective contribution or nonelective contribution
by taking into account: (Choose (a) or (b))
[ ] (a) The Employee's Compensation for the entire Plan Year.
[X] (b) The Employee's Compensation for the portion of the Plan Year in
which the Employee actually is a Participant in the Plan.
Accrual Requirements. Subject to the suspension of accrual requirements
of Section 3.06(E) of the Plan, to receive an allocation of cash or
deferred contributions, matching contributions, designated qualified
nonelective contributions, nonelective contributions and Participant
forfeitures, if any, for the Plan Year, a Participant must satisfy the
conditions described in the following elections: (Choose (c) or at least
one of (d) through (f))
[ ] (c) Safe harbor rule. If the Participant is employed by the Employer
on the last day of the Plan Year, the Participant must complete at
least one Hour of Service for that Plan Year. If the Participant
is not employed by the Employer on the last day of the Plan Year,
the Participant must complete at least 501 Hours of Service during
the Plan Year.
[ ] (d) Hours of Service condition. The Participant must complete the
following minimum number of Hours of Service during the Plan Year:
(Choose at least one of (1) through (5))
[ ] (1) 1,000 Hours of Service.
[ ] (2) (Specify, but the number of Hours of Service may not
exceed 1,000) ___________________________________________.
[ ] (3) No Hour of Service requirement if the Participant
terminates employment during the Plan Year on account of:
(Choose (i), (ii) or (iii))
[ ] (i) Death.
[ ] (ii) Disability.
[ ] (iii) Attainment of Normal Retirement Age in the current
Plan Year or in a prior Plan Year.
[ ] (4) _________________________________________ Hours of Service
(not exceeding 1,000) if the Participant terminates employment
with the Employer during the Plan Year, subject to any election
in Option (3).
[ ] (5) No Hour of Service requirement for an allocation of the
following contributions: _____________________________________.
[X] (e) Employment condition. The Participant must be employed by the
Employer on the last day of the Plan Year, irrespective of whether
he satisfies any Hours of Service condition under Option (d), with the
following exceptions: (Choose (1) or at least one of (2) through (5))
[X] (1) No exceptions.
[ ] (2) Termination of employment because of death.
[ ] (3) Termination of employment because of disability.
[ ] (4) Termination of employment following attainment of Normal
Retirement Age.
[ ] (5) No employment condition for the following contributions:
___________________________________________
.
[ ] (f) (Specify other conditions, if applicable): ______________________
__________________.
Suspension of Accrual Requirements. The suspension of accrual requirements
of Section 3.06(E) of the Plan: (Choose (g), (h) or (i))
[X] (g) Applies to the Employer's Plan.
[ ] (h) Does not apply to the Employer's Plan.
[ ] (i) Applies in modified form to the Employer's Plan, as described in
an addendum to this Adoption Agreement, numbered Section 3.06(E).
Special accrual requirements for matching contributions. If the Plan
allocates matching contributions on two or more allocation dates for a
Plan Year, the Advisory Committee, unless otherwise specified in
Option (l), will apply any Hours of Service condition by dividing the
required Hours of Service on a prorata basis to the allocation periods
included in that Plan Year. Furthermore, a Participant who satisfies the
conditions described in this Adoption Agreement Section 3.06 will receive
an allocation of matching contributions (and forfeitures treated as
matching contributions) only if the Participant satisfies the following
additional condition(s): (Choose (j) or at least one of (k) or (l))
[ ] (j) No additional conditions.
[ ] (k) The Participant is not a Highly Compensated Employee for the Plan
Year. This Option (k) applies to: (Choose (1) or (2))
[ ] (1) All matching contributions.
[ ] (2) Matching contributions described in Option(s) ____________
of Adoption Agreement Section 3.01.
[ ] (l) (Specify) ________________________________________________________.
3.15 MORE THAN ONE PLAN LIMITATION. If the provisions of Section 3.15
-----------------------------
apply, the Excess Amount attributed to this Plan equals: (Choose (a), (b)
or (c))
[ ] (a) The product of:
(i) the total Excess Amount allocated as of such date (including
any amount which the Advisory Committee would have allocated but
for the limitations of Code Section 415), times
(ii) the ratio of (1) the amount allocated to the Participant as
of such date under this Plan divided by (2) the total amount
allocated as of such date under all qualified defined contribution
plans (determined without regard to the limitations of Code Section
415).
[X] (b) The total Excess Amount.
[ ] (c) None of the Excess Amount.
3.18 DEFINED BENEFIT PLAN LIMITATION.
-------------------------------
Application of limitation. The limitation under Section 3.18 of the Plan:
(Choose (a) or (b))
[X] (a) Does not apply to the Employer's Plan because the Employer does
not maintain and never has maintained a defined benefit plan covering
any Participant in this Plan.
[ ] (b) Applies to the Employer's Plan. To the extent necessary to
satisfy the limitation under Section 3.18, the Employer will reduce:
(Choose (1) or (2))
[ ] (1) The Participant's projected annual benefit under the
defined benefit plan under which the Participant participates.
[ ] (2) Its contribution or allocation on behalf of the Participant
to the defined contribution plan under which the Participant
participates and then, if necessary, the Participant's projected
annual benefit under the defined benefit plan under which the
Participant participates.
[Note: If the Employer selects (a), the remaining options in this Section
3.18 do not apply to the Employer's Plan.]
Coordination with top heavy minimum allocation. The Advisory Committee
will apply the top heavy minimum allocation provisions of Section 3.04(B)
of the Plan with the following modifications: (Choose (c) or at least one
of (d) or (e))
[ ] (c) No modifications.
[ ] (d) For Non-Key Employees participating only in this Plan, the top
heavy minimum allocation is the minimum allocation described in
Section 3.04(B) determined by substituting _____% (not less than 4%)
for "3%," except: (Choose (i) or (ii))
[ ] (i) No exceptions.
[ ] (ii) Plan Years in which the top heavy ratio exceeds 90%.
[ ] (e) For Non-Key Employees also participating in the defined benefit
plan, the top heavy minimum is: (Choose (1) or (2))
[ ] (1) 5% of Compensation (as determined under Section 3.04(B)
or the Plan) irrespective of the contribution rate of any Key
Employee, except: (Choose (i) or (ii))
[ ] (i) No exceptions.
[ ] (ii) Substituting "7-1/2%" for "5%" if the top heavy ratio
does not exceed 90%.
[ ] (2) 0%. [Note: The Employer may not select this Option
(2) unless the defined benefit plan satisfies the top heavy
minimum benefit requirements of Code Section 416 for these Non-Key
Employees.]
Actuarial Assumptions for Top Heavy Calculation. To determine the top
heavy ratio, the Advisory Committee will use the following interest
rate and mortality assumptions to value accrued benefits under a
defined benefit plan: __________________________________________________.
If the elections under this Section 3.18 are not appropriate to satisfy
the limitations of Section 3.18, or the top heavy requirements under
Code Section 416, the Employer must provide the appropriate provisions in an
addendum to this Adoption Agreement.
ARTICLE IV
PARTICIPANT CONTRIBUTIONS
4.01 PARTICIPANT NONDEDUCTIBLE CONTRIBUTIONS. The Plan: (Choose (a)
---------------------------------------
or (b); (c) is available only with (b))
[X] (a) Does not permit Participant nondeductible contributions.
[ ] (b) Permits Participant nondeductible contributions, pursuant to
Section 14.04 of the Plan.
[ ] (c) The following portion of the Participant's nondeductible
contributions for the Plan Year are mandatory contributions under
Option (i)(3) of Adoption Agreement Section 3.01: (Choose (1) or (2))
[ ] (1) The amount which is not less than: __________________________.
[ ] (2) The amount which is not greater than: _______________________.
Allocation dates. The Advisory Committee will allocate nondeductible
contributions for each Plan Year as of the Accounting Date and the
following additional allocation dates: (Choose (d) or (e))
[ ] (d) No other allocation dates.
[ ] (e) (Specify).
As of an allocation date, the Advisory Committee will credit all
nondeductible contributions made for the relevant allocation period.
Unless otherwise specified in (e), a nondeductible contribution relates
to an allocation period only if actually made to the Trust no later than
30 days after that allocation period ends.
4.05 PARTICIPANT CONTRIBUTION - WITHDRAWAL/DISTRIBUTION. Subject to
---------------------------------------------------
the restrictions of Article VI, the following distribution options apply
to a Participant's Mandatory Contributions Account, if any, prior to
his Separation from Service: (Choose (a) or at least one of (b) through (d))
[ ] (a) No distribution options prior to Separation from Service.
[ ] (b) The same distribution options applicable to the Deferral
Contributions Account prior to the Participant's Separation from
Service, as elected in Adoption Agreement Section 6.03.
[ ] (c) Until he retires, the Participant has a continuing election to
receive all or any portion of his Mandatory Contributions Account
if: (Choose (1) or at least one of (2) through (4))
[ ] (1) No conditions.
[ ] (2) The mandatory contributions have accumulated for at least
________ Plan Years since the Plan Year for which contributed.
[ ] (3) The Participant suspends making nondeductible contributions
for a period of ____ months.
[ ] (4) (Specify) _________________________________________________.
[ ] (d) (Specify) ______________________________________________.
ARTICLE V
TERMINATION OF SERVICE - PARTICIPANT VESTING
5.01 NORMAL RETIREMENT. Normal Retirement Age under the Plan is
-----------------
(Choose (a) or (b))
[X] (a) 55 [State age, but may not exceed age 65].
--
[ ] (b) The later of the date the Participant attains _____ years of age
or the _____ anniversary of the first day of the Plan Year in which
the Participant commenced participation in the Plan. [ The age
selected may not exceed age 65 and the anniversary selected may
not exceed the 5th.]
5.02 PARTICIPANT DEATH OR DISABILITY. The 100% vesting rule under
-------------------------------
Section 5.02 of the Plan: (Choose (a) or choose one or both of (b) and (c))
[ ] (a) Does not apply.
[X] (b) Applies to death.
[X] (c) Applies to disability.
5.03 VESTING SCHEDULE.
----------------
Deferral Contributions Account/Qualified Matching Contributions
Account/Qualified Nonelective Contributions Account/Mandatory
Contributions Account. A Participant has a 100% Nonforfeitable interest
at all times in his Deferral Contributions Account, his Qualified
Matching Contributions Account, his Qualified Nonelective Contributions
Account and in his Mandatory Contributions Account.
Regular Matching Contributions Account/Employer Contributions Account.
With respect to a Participant's Regular Matching Contributions
Account and Employer Contributions Account, the Employer elects
the following vesting schedule: (Choose (a) or (b); (c) and (d) are
available only as additional options)
[X] (a) Immediate vesting. 100% Nonforfeitable at all times.
[ Note: The Employer must elect Option (a) if the eligibility
conditions under Adoption Agreement Section 2.01(c) require 2 years
of service or more than 12 months of employment.]
[ ] (b) Graduated Vesting Schedules.
Top Heavy Schedule Non Top Heavy Schedule
(Mandatory) (Optional)
Years of Nonforfeitable Years of Nonforfeitable
Service Percentage Service Percentage
-------- -------------- -------- --------------
Less than 1......... ___% Less than 1............... ___%
1......... ___% 1............... ___%
2......... ___% 2............... ___%
3......... ___% 3............... ___%
4......... ___% 4............... ___%
5......... ___% 5............... ___%
6 or more.. 100% 6............... ___%
7 or more....... 100%
[ ] (c) Special vesting election for Regular Matching Contributions Account.
In lieu of the election under Options (a) or (b), the Employer elects
the following vesting schedule for a Participant's Regular Matching
Contributions Account: (Choose (1) or (2))
[ ] (1) 100% Nonforfeitable at all times.
[ ] (2) In accordance with the vesting schedule described in the
addendum to this Adoption Agreement, numbered 5.03(c).
[Note: If the Employer elects this Option (c)(2), the addendum
must designate the applicable vesting schedule(s) using the
same format as used in Option (b).]
[Note: Under Options (b) and (c)(2), the Employer must complete a Top
Heavy Schedule which satisfies Code Section 416. The Employer, at its option,
may complete a Non Top Heavy Schedule. The Non Top Heavy Schedule must
satisfy Code Section 411(a)(2). Also see Section 7.05 of the Plan.]
[ ] (d) The Top Heavy Schedule under Option (b) (and, if applicable,
under Option (c)(2)) applies: (Choose (1) or (2))
[ ] (1) Only in a Plan Year for which the Plan is top heavy.
[ ] (2) In the Plan Year for which the Plan first is top heavy
and then in all subsequent Plan Years. [Note: The Employer
may not elect Option (d) unless it has completed a Non Top
Heavy Schedule.]
Minimum vesting. (Choose (e) or (f))
[X] (e) The Plan does not apply a minimum vesting rule.
[ ] (f) A Participant's Nonforfeitable Accrued Benefit will never be
less than the lesser of $374~ or his entire Accrued Benefit, even if
the application of a graduated vesting schedule under Options (b) or
(c) would result in a smaller Nonforfeitable Accrued Benefit.
Life Insurance Investments. The Participant's Accrued Benefit attributable
to insurance contracts purchased on his behalf under Article XI is:
(Choose (g) or (h))
[ ] (g) Subject to the vesting election under Options (a), (b) or (c).
[] (h) 100% Nonforfeitable at all times, irrespective of the vesting
election under Options (b) or (c)(2).
5.04 CASH-OUT DISTRIBUTIONS TO PARTIALLY-VESTED PARTICIPANTS/
--------------------------------------------------------
RESTORATION OF FORFEITED ACCRUED BENEFIT. The deemed cash-out
----------------------------------------
rule described in Section 5.04(C) of the Plan: (Choose (a) or (b))
[X] (a) Does not apply.
[ ] (b) Will apply to determine the timing of forfeitures for 0% vested
Participants. A Participant is not a 0% vested Participant if he
has a Deferral Contributions Account.
5.06 YEAR OF SERVICE - VESTING.
-------------------------
Vesting computation period. The Plan measures a Year of Service on the
basis of the following 12 consecutive month periods: (Choose (a) or (b))
[X] (a) Plan Years.
[ ] (b) Employment Years. An Employment Year is the 12 consecutive month
period measured from the Employee's Employment Commencement Date and
each successive 12 consecutive month period measured from each
anniversary of that Employment Commencement Date.
Hours of Service. The minimum number of Hours of Service an Employee must
complete during a vesting computation period to receive credit for a Year
of Service is: (Choose (c) or (d))
[X] (c) 1,000 Hours of Service.
[ ] (d) 383~ Hours of Service. [Note: The Hours of Service requirement
may not exceed 1,000.]
5.08 INCLUDED YEARS OF SERVICE - VESTING. The Employer specifically
-----------------------------------
excludes the following Years of Service: (Choose (a) or at least one of
(b) through (e))
[ ] (a) None other than as specified in Section 5.08(a) of the Plan.
[X] (b) Any Year of Service before the Participant attained the age of 18.
--
Note: The age selected may not exceed age 18.]
[ ] (c) Any Year of Service during the period the Employer did not
maintain this Plan or a predecessor plan.
[X] (d) Any Year of Service before a Break in Service if the number of
consecutive Breaks in Service equals or exceeds the greater of 5 or the
aggregate number of the Years of Service prior to the Break. This
exception applies only if the Participant is 0% vested in his Accrued
Benefit derived from Employer contributions at the time he has a Break
in Service. Furthermore, the aggregate number of Years of Service before
a Break in Service do not include any Years of Service not required to be
taken into account under this exception by reason of any prior Break in
Service.
[X] (e) Any Year of Service earned prior to the effective date of ERISA if
the Plan would have disregarded that Year of Service on account of
an Employee's Separation from Service under a Plan provision in
effect and adopted before January 1, 1974.
ARTICLE VI
TIME AND METHOD OF PAYMENTS OF BENEFITS
Code Section 411(d)(6) Protected Benefits. The elections under this Article VI
may not eliminate Code Section 411(d)(6) protected benefits. To the extent
the elections would eliminate a Code Section 411(d)(6) protected benefit, see
Section 13.02 of the Plan. Furthermore, if the elections liberalize the
optional forms of benefit under the Plan, the more liberal options apply
on the later of the adoption date or the Effective Date of this Adoption
Agreement.
6.01 TIME OF PAYMENT OF ACCRUED BENEFIT.
----------------------------------
Distribution date. A distribution date under the Plan means 390~.
[Note: The Employer must specify the appropriate date(s). The specified
distribution dates primarily establish annuity starting dates and the
notice and consent periods prescribed by the Plan. The Plan allows the
Trustee an administratively practicable period of time to make the
actual distribution relating to a particular distribution date.]
Nonforfeitable Accrued Benefit Not Exceeding $3,500. Subject to the
limitations of Section 6.01(A)(1), the distribution date for
distribution of a Nonforfeitable Accrued Benefit not exceeding $3,500
is: (Choose (a), (b), (c), (d) or (e))
[ ] (a) ______________________________________ of the _______________
________________________________ Plan Year beginning after
the Participant's Separation from Service.
[X] (b) the first administratively feasible distribution date following
-----------------------------------------------------
the Participant's Separation from Service.
[ ] (c) __________________________________________________ of the Plan
Year after the Participant incurs ________________________________
Break(s) in Service (as defined in Article V).
[ ] (d) following the Participant's attainment of Normal Retirement
Age, but not earlier than _____________ days following his Separation
from Service.
[ ] (e) (Specify) .
Nonforfeitable Accrued Benefit Exceeds $3,500. See the elections under
Section 6.03.
Disability. The distribution date, subject to Section 6.01(A)(3), is:
(Choose (f), (g) or (h))
[ ] (f) ___________________________________________________ after the
Participant terminates employment because of disability.
[X] (g) The same as if the Participant had terminated employment
without disability.
[ ] (h) (Specify) __________________________________________________.
Hardship. (Choose (i) or (j))
[X] (i) The Plan does not permit a hardship distribution to a Participant
who has separated from Service.
[ ] (j) The Plan permits a hardship distribution to a Participant who
has separated from Service in accordance with the hardship
distribution policy stated in: (Choose (1), (2) or (3))
[ ] (1) Section 6.01(A)(4) of the Plan.
[ ] (2) Section 14.11 of the Plan.
[ ] (3) The addendum to this Adoption Agreement, numbered Section 6.01.
Default on a Loan. If a Participant or Beneficiary defaults on a loan made
pursuant to a loan policy adopted by the Advisory Committee pursuant to
Section 9.04, the Plan: (Choose (k), (l) or (m))
[X] (k) Treats the default as a distributable event. The Trustee, at the
time of the default, will reduce the Participant's Nonforfeitable
Accrued Benefit by the lesser of the amount in default (plus accrued
interest) or the Plan's security interest in that Nonforfeitable
Accrued Benefit. To the extent the loan is attributable to the
Participant's Deferral Contributions Account, Qualified Matching
Contributions Account or Qualified Nonelective Contributions Account,
the Trustee will not reduce the Participant's Nonforfeitable Accrued
Benefit unless the Participant has separated from Service or unless
the Participant has attained age 59-1/2.
[ ] (l) Does not treat the default as a distributable event. When an
otherwise distributable event first occurs pursuant to Section 6.01
or Section 6.03 of the Plan, the Trustee will reduce the
Participant's Nonforfeitable Accrued Benefit by the lesser of the
amount in default (plus accrued interest) or the Plan's security
interest in that Nonforfeitable Accrued Benefit.
[ ] (m) (Specify) ____________________________________________.
6.02 METHOD OF PAYMENT OF ACCRUED BENEFIT. The Advisory Committee will
------------------------------------
apply Section 6.02 of the Plan with the following modifications:
(Choose (a) or at least one of (b), (c), (d) and (e))
[ ] (a) No modifications.
[ ] (b) Except as required under Section 6.01 of the Plan, a lump sum
distribution is not available: ____________________________________.
[ ] (c) An installment distribution: (Choose (1) or at least one of (2)
or (3))
[ ] (1) Is not available under the Plan.
[ ] (2) May not exceed the lesser of __________ years or the
maximum period permitted under Section 6.02.
[ ] (3) (Specify) ________________________________________________.
[X] (d) The Plan permits the following annuity options: a single life
-------------
or joint and survivor annuity with a minimum guaranteed number of
-----------------------------------------------------------------
monthly benefits payable to the participant and his designated
--------------------------------------------------------------
beneficiary or a qualified joint and survivor annuity for the
-------------------------------------------------------------
life of the participant's spouse which is not less than 50% and
---------------------------------------------------------------
not more than 100% of the amount of the annuity payable to the
--------------------------------------------------------------
participant.
-----------
Any Participant who elects a life annuity option is subject to the
requirements of Sections 6.04(A), (B), (C) and (D) of the Plan.
See Section 6.04(E). [Note: The Employer may specify additional
annuity options in an addendum to this Adoption Agreement,
numbered 6.02(d).]
[ ] (e) If the Plan invests in qualifying Employer securities, as
described in Section 10.03(F), a Participant eligible to elect
distribution under Section 6.03 may elect to receive that
distribution in Employer securities only in accordance with
the provisions of the addendum to this Adoption Agreement,
numbered 6.02(e).
6.03 BENEFIT PAYMENT ELECTIONS.
-------------------------
Participant Elections After Separation from Service. A Participant who is
eligible to make distribution elections under Section 6.03 of the Plan
may elect to commence distribution of his Nonforfeitable Accrued
Benefit: (Choose at least one of (a) through (c))
[ ] (a) As of any distribution date, but not earlier than _______________
______________ of the _________________________ Plan Year beginning
after the Participant's Separation from Service.
[x] (b) As of the following date(s): (Choose at least one of Options (1)
through (6))
[ ] (1) Any distribution date after the close of the Plan Year
in which the Participant attains Normal Retirement Age.
[X] (2) Any distribution date following his Separation from Service
with the Employer.
[ ] (3) Any distribution date in the _____________________________
Plan Year(s) beginning after his Separation from Service.
[ ] (4) Any distribution date in the Plan Year after the Participant
incurs _____________________________ Break(s) in Service
(as defined in Article V).
[ ] (5) Any distribution date following attainment of age _________
and completion of at least ____________ Years of Service
(as defined in Article V).
[ ] (6) (Specify) __________________________________________________.
[ ] (c) (Specify) _____________________________________________________.
The distribution events described in the election(s) made under
Options (a), (b) or (c) apply equally to all Accounts maintained for
the Participant unless otherwise specified in Option (c).
Participant Elections Prior to Separation from Service - Regular Matching
Contributions Account and Employer Contributions Account. Subject to the
restrictions of Article VI, the following distribution options apply to
a Participant's Regular Matching Contributions Account and Employer
Contributions Account prior to his Separation from Service: (Choose
(d) or at least one of (e) through (h))
[ ] (d) No distribution options prior to Separation from Service.
[X] (e) Attainment of Specified Age. Until he retires, the Participant
has a continuing election to receive all or any portion of his
Nonforfeitable interest in these Accounts after he attains:
(Choose (1) or (2))
[ ] (1) Normal Retirement Age.
[X] (2) 59 1/2 years of age and is at least 100% vested in these
Accounts. [Note: If the percentage is less than 100%, see the
special vesting formula in Section 5.03.]
[ ] (f) After a Participant has participated in the Plan for a period of
not less than ______ years and he is 100% vested in these Accounts,
until he retires, the Participant has a continuing election to
receive all or any portion of the Accounts. [Note: The number in
the blank space may not be less than 5.]
[X] (g) Hardship. A Participant may elect a hardship distribution prior
to his Separation from Service in accordance with the hardship
distribution policy: (Choose (1), (2) or (3); (4) is available
only as an additional option)
[ ] (1) Under Section 6.01(A)(4) of the Plan.
[X] (2) Under Section 14.11 of the Plan.
[ ] (3) Provided in the addendum to this Adoption Agreement,
numbered Section 6.03.
[] (4) In no event may a Participant receive a hardship
distribution before he is at least _____% vested in these
Accounts. [Note: If the percentage in the blank is less than
100%, see the special vesting formula in Section 5.03.]
[ ] (h) (Specify) _____________________________________________________.
[Note: The Employer may use an addendum, numbered 6.03, to provide
additional language authorized by Options (b)(6), (c), (g)(3) or (h) of
this Adoption Agreement Section 6.03.]
Participant Elections Prior to Separation from Service - Deferral
Contributions Account, Qualified Matching Contributions Account and
Qualified Nonelective Contributions Account. Subject to the restrictions
of Article VI, the following distribution options apply to a
Participant's Deferral Contributions Account, Qualified Matching
Contributions Account and Qualified Nonelective Contributions Account
prior to his Separation from Service: (Choose (i) or at least one of
(j) through (l))
[ ] (i) No distribution options prior to Separation from Service.
[X] (j) Until he retires, the Participant has a continuing election to
receive all or any portion of these Accounts after he attains:
(Choose (1) or (2))
[ ] (1) The later of Normal Retirement Age or age 59-1/2.
[X] (2) Age 59 1/2 (at least 59-1/2).
[X] (k) Hardship. A Participant, prior to this Separation from Service,
may elect a hardship distribution from his Deferral Contributions
Account in accordance with the hardship distribution policy under
Section 14.11 of the Plan.
[ ] (l) (Specify) ________________________________________. [Note: Option
(l) may not permit in service distributions prior to age 59-1/2 (other
than hardship) and may not modify the hardship policy described in
Section 14.11.]
Sale of trade or business/subsidiary. If the Employer sells substantially
all of the assets (within the meaning of Code Section 409(d)(2)) used in a
trade or business or sells a subsidiary (within the meaning of Code
Section 409(d)(3)), a Participant who continues employment with the acquiring
corporation is eligible for distribution from his Deferral Contributions
Account, Qualified Matching Contributions Account and Qualified Nonelective
Contributions Account: (Choose (m) or (n))
[X] (m) Only as described in this Adoption Agreement Section 6.03 for
distributions prior to Separation from Service.
[ ] (n) As if he has a Separation from Service. After March 31, 1988,
a distribution authorized solely by reason of this Option (n)
must constitute a lump sum distribution, determined in a manner
consistent with Code Section 401(k)(10) and the applicable Treasury
regulations.
6.04 ANNUITY DISTRIBUTIONS TO PARTICIPANTS AND SURVIVING SPOUSES.
The annuity distribution requirements of Section 6.04: (Choose (a) or (b))
[ ] (a) Apply only to a Participant described in Section 6.04(E) of the
Plan (relating to the profit sharing exception to the joint and
survivor requirements).
[X] (b) Apply to all Participants.
ARTICLE IX
ADVISORY COMMITTEE - DUTIES WITH RESPECT TO PARTICIPANTS' ACCOUNTS
9.10 VALUE OF PARTICIPANT'S ACCRUED BENEFIT. If a distribution (other
than a distribution from a segregated Account and other than a corrective
distribution described in Sections 14.07, 14.08, 14.09 or 14.10 of the
Plan) occurs more than 90 days after the most recent valuation date,
the distribution will include interest at: (Choose (a), (b) or (c))
[X] (a) 0% per annum. [Note: The percentage may equal 0%.]
-
[ ] (b) The 90 day Treasury bill rate in effect at the beginning of the
current valuation period.
[ ] (c) (Specify) _______________________________________________________.
9.11 ALLOCATION AND DISTRIBUTION OF NET INCOME GAIN OR LOSS. Pursuant
to Section 14.12, to determine the allocation of net income, gain or
loss: (Complete only those items, if any, which are applicable to the
Employer's Plan)
[X] (a) For salary reduction contributions, the Advisory Committee will:
(Choose (1), (2), (3), (4) or (5))
[X] (1) Apply Section 9.11 without modification.
[ ] (2) Use the segregated account approach described in Section 14.12.
[ ] (3) Use the weighted average method described in Section 14.12,
based on a _________________________________ weighting period.
[ ] (4) Treat as part of the relevant Account at the beginning of
the valuation period 486~% of the salary reduction
contributions: (Choose (i) or (ii))
[ ] (i) made during that valuation period.
[ ] (ii) made by the following specified time: _________________
_________________________.
[ ] (5) Apply the allocation method described in the addendum to
this Adoption Agreement numbered 9.11(a).
[ ] (b) For matching contributions, the Advisory Committee will:
(Choose (1), (2), (3) or (4))
[ ] (1) Apply Section 9.11 without modification.
[ ] (2) Use the weighted average method described in Section 14.12,
based on a ____________________ weighting period.
[ ] (3) Treat as part of the relevant Account at the beginning
of the valuation period _____% of the matching contributions
allocated during the valuation period.
[ ] (4) Apply the allocation method described in the addendum to
this Adoption Agreement numbered 9.11(b).
[ ] (c) For Participant nondeductible contributions, the Advisory
Committee will: (Choose (1), (2), (3), (4) or (5))
[ ] (1) Apply Section 9.11 without modification.
[ ] (2) Use the segregated account approach described in Section 14.12.
[ ] (3) Use the weighted average method described in Section 14.12,
based on a 502~ weighting period.
[ ] (4) Treat as part of the relevant Account at the beginning
of the valuation period _____% of the Participant
nondeductible contributions: (Choose (i) or (ii))
[ ] (i) made during that valuation period.
[ ] (ii) made by the following specified time: _______________
______________________________.
[ ] (5) Apply the allocation method described in the addendum to
this Adoption Agreement numbered 9.11(c).
ARTICLE X
TRUSTEE AND CUSTODIAN, POWERS AND DUTIES
10.03 INVESTMENT POWERS. Pursuant to Section 10.03[F] of the Plan,
-----------------
the aggregate investments in qualifying Employer securities and in
qualifying Employer real property: (Choose (a) or (b))
[ ] (a) May not exceed 10% of Plan assets.
[X] (b) May not exceed 100% of Plan assets. [Note: The percentage may
----
not exceed 100%.]
10.14 VALUATION OF TRUST. In addition to each Accounting Date, the
------------------
Trustee must value the Trust Fund on the following valuation date(s):
(Choose (a) or (b))
[ ] (a) No other mandatory valuation dates.
[X] (b) (Specify) effective May 1, 1998, each business day. Prior to
---------------------------------------------------
May 1, 1998, such additional dates designated by the Plan
---------------------------------------------------------
Administrator on a uniform and nondiscriminatory basis.
------------------------------------------------------
EFFECTIVE DATE ADDENDUM
(Restated Plans Only)
The Employer must complete this addendum only if the restated
Effective Date specified in Adoption Agreement Section 1.18 is
different than the restated effective date for at least one of the
provisions listed in this addendum. In lieu of the restated Effective
Date in Adoption Agreement Section 1.18, the following special effective
dates apply: (Choose whichever elections apply)
[ ] (a) Compensation definition. The Compensation definition of Section
1.12 (other than the $200,000 limitation) is effective for Plan Years
beginning after 516~. [Note: May not be effective later than the
first day of the first Plan Year beginning after the Employer
executes this Adoption Agreement to restate the Plan for the Tax
Reform Act of 1986, if applicable.]
[ ] (b) Eligibility conditions. The eligibility conditions specified in
Adoption Agreement Section 2.01 are effective for Plan Years
beginning after ________.
[ ] (c) Suspension of Years of Service. The suspension of Years of
Service rule elected under Adoption Agreement Section 2.03 is
effective for Plan Years beginning after ________.
[ ] (d) Contribution/allocation formula. The contribution formula
elected under Adoption Agreement Section 3.01 and the method
of allocation elected under Adoption Agreement Section 3.04 is
effective for Plan Years beginning after _________.
[ ] (e) Accrual requirements. The accrual requirements of Section
3.06 are effective for Plan Years beginning after _________.
[ ] (f) Employment condition. The employment condition of Section
3.06 is effective for Plan Years beginning after _________.
[ ] (g) Elimination of Net Profits. The requirement for the Employer
not to have net profits to contribute to this Plan is effective for
Plan Years beginning after _________. [Note: The date specified may
not be earlier than December 31, 1985.]
[ ] (h) Vesting Schedule. The vesting schedule elected under Adoption
Agreement Section 5.03 is effective for Plan Years beginning
after _________.
[ ] (i) Allocation of Earnings. The special allocation provisions
elected under Adoption Agreement Section 9.11 are effective May 1,
1998.
[ ] (j) (Specify) Time of payments of benefits. The provisions for time
-------------------------------------------------------
of payment of accrued benefit not exceeding $3,500 under Section 6.01
---------------------------------------------------------------------
and for the time of payment of benefits under Section 6.03 are
--------------------------------------------------------------
effective May 1, 1998.
---------------------
For Plan Years prior to the special Effective Date, the terms of the
Plan prior to its restatement under this Adoption Agreement will control
for purposes of the designated provisions. A special Effective Date may
not result in the delay of a Plan provision beyond the permissible
Effective Date under any applicable law requirements.
Execution Page
The Trustee (and Custodian, if applicable), by executing this Adoption
Agreement, accepts its position and agrees to all of the obligations,
responsibilities and duties imposed upon the Trustee (or Custodian) under
the Master Plan and Trust. The Employer hereby agrees to the provisions
of this Plan and Trust, and in witness of its agreement, the Employer by
its duly authorized officers, has executed this Adoption Agreement, and the
Trustee (and Custodian, if applicable) signified its acceptance, on
this ___ day of ____________, ___.
Name and EIN of Employer: Regal-Beloit Corporation EIN #39-0875718
-----------------------------------------
Signed: _____________________________________
Name(s) of Trustee: Marshall & Ilsley Trust Company
-------------------------------
Signed: _____________________________________
Name of Custodian: _________________________________________________
Signed: _____________________________________
[Note: A Trustee is mandatory, but a Custodian is optional. See Section
10.03 of the Plan.]
Plan Number. The 3-digit plan number the Employer assigns to this Plan
for ERISA reporting purposes (Form 5500 Series) is: 007.
---
Use of Adoption Agreement. Failure to complete properly the elections
in this Adoption Agreement may result in disqualification of the
Employer's Plan. The 3-digit number assigned to this Adoption
Agreement (see page 1) is solely for the Master Plan Sponsor's
recordkeeping purposes and does not necessarily correspond to the
plan number the Employer designated in the prior paragraph.
Master Plan Sponsor. The Master Plan Sponsor identified on the first
page of the basic plan document will notify all adopting employers of
any amendment of this Master Plan or of any abandonment or
discontinuance by the Master Plan Sponsor of its maintenance of this
Master Plan. For inquiries regarding the adoption of the Master Plan,
the Master Plan Sponsor's intended meaning of any plan provisions or
the effect of the opinion letter issued to the Master Plan Sponsor,
please contact the Master Plan Sponsor at the following address and
telephone number: 1000 North Water Street, Milwaukee, WI 53202
--------------------------------------------
414-287-8700.
- ------------
Reliance on Opinion Letter. The Employer may not rely on the Master
Plan Sponsor's opinion letter covering this Adoption Agreement. For
reliance on the Plan's qualification, the Employer must obtain a
determination letter from the applicable IRS Key District office.
PARTICIPATION AGREEMENT
For Participation by Related Group Members (Plan Section 1.30)
The undersigned Employer, by executing this Participation Agreement,
elects to become a Participating Employer in the Plan identified in
Section 1.03 of the accompanying Adoption Agreement, as if the
Participating Employer were a signatory to that Agreement. The
Participating Employer accepts, and agrees to be bound by, all of the
elections granted under the provisions of the Master Plan as made by
550~, the Signatory Employer to the Execution Page of the Adoption
Agreement.
1. The Effective Date of the undersigned Employer's participation
in the designated Plan is: __________.
2. The undersigned Employer's adoption of this Plan constitutes:
[ ] (a) The adoption of a new plan by the Participating Employer.
[X] (b) The adoption of an amendment and restatement of a plan currently
maintained by the Employer, identified as Regal-Beloit Corporation
------------------------
Savings and Protection Plan, and having an original effective date
---------------------------
of October 1, 1987.
---------------
Dated this ____________ day of ____________ , ____.
Name of Participating Employer: ____________________
________________________________
Signed:________________________________
Participating Employer's EIN: ______________
Acceptance by the Signatory Employer to the Execution Page of the Adoption
Agreement and by the Trustee.
Name of Signatory Employer: Regal-Beloit Corporation
------------------------
Accepted:_____________________
[Date] Signed:__________________________
Name(s) of Trustee: ________________________
__________________________________________
Accepted:______________________
[Date] Signed:___________________________
[Note: Each Participating Employer must execute a separate Participation
Agreement. See the Execution Page of the Adoption Agreement for important
Master Plan information.]H