SALANT CORPORATION PENSION PLAN
AS RESTATED
DECEMBER 1, 1988
TABLE OF CONTENTS
ARTICLE PAGE
PREAMBLE.......................... 1
I DEFINITIONS ............. 2
II SERVICE .......................... 8
III MEMBERSHIP.... 11
IV ELIGIBILITY FOR PLAN BENEFITS 12
V BENEFIT ACCRUAL .. 13
VI AMOUNT OF BENEFIT ...... 14
VII MANNER AND FORM OF PAYMENT 17
VIII CONTRIBUTIONS AND FUNDING. 21
IX LIMITATIONS ON BENEFITS AND CONTIBUTIONS 22
X TOP-HEAVY PLAN YEARS............. 28
XI ADMINISTRATION; CLAIMS PROCEDURE 34
XII THE TRUST FUND . 37
XIII AMENDMENT AND TERMINATION OFTHE PLAN 38
XIV LIMITATION OF BENEFITS FOR HIGHLY PAID
EMPLOYEES 41
XV MISCELLANEOUS PROVISION .. 42
APPENDIX A 44
PREAMBLE
Salant Corporation hereby amends the Salant
Corporation Pension Plan (the "Plan") to comply with requirements
of the Tax Reform Act of 1986, the Revenue Act of 1987, the
Technical and Miscellaneous Revenue Act of 1989, the Omnibus
Reconciliation Act of 1989 and the Unemployment Compensation
Amendments of 1992 (the "Acts") effective as of the pertinent
effective dates contained in the provisions of the Acts, and restates
the Plan as follows:
ARTICLE I
DEFINITIONS
The following words and phrases when used with the initial capital
letter throughout this Plan and any subsequent amendment thereof
shall have the meanings set forth below unless a different meaning
is plainly required by the context.
1.1 "Accrued Benefit" means the monthly amount of
benefit to which a Member would be entitled,
determined in accordance with Article V, commencing
on the later of (a) his Normal Retirement Date and (b)
his Benefit Commencement Date with the manner of
payment being a Life Annuity as described in Section
7.3.
1.2 "Actuarial Equivalent" means
(a) in the case of a benefit
other than a lump sum, an amount
of equivalent value determined on
the basis of (1) the Member's (and
where applicable, the beneficiary's)
age as of his Benefit
Commencement Date, (2) the 1971
Group Annuity Mortality Table
weighted 60% female, 40% male
for Members and 60% male, 40%
female for beneficiaries, and (3) an
investment rate of 7% compounded
annually; and
(b) in the case of a lump sum
payable to a Member or former
Member, an amount equivalent to
the present value as of the
Member's Benefit Commencement
Date of the Member's Retirement
Benefit or Vested Deferred Benefit
payable as of his Normal
Retirement Date in the form of a
single life annuity, determined on
the basis of (1) the Member's age
as of his Benefit Commencement
Date, and (2) the mortality table
specified in (a) and (3) the interest
rates promulgated by the Pension
Benefit Guaranty Corporation for
single employer plan terminations
occurring on the first day of the
Plan Year of the date of payment.
(c) in the case of a lump sum
payable to the surviving Spouse or
beneficiary of a Member, an
amount equivalent to the present
value, as of the Benefit
Commencement Date, of the
survivor annuity payable under
Section 4.5 or 4.6 in the form of a
single life annuity commencing on
the date specified in Section 7.5 or
7.6 based on (1) the age of the
surviving Spouse or beneficiary as
of the Benefit Commencement
Date, (2) the Mortality Tables
described in Subsection (a) above,
and (3) the interest rates
promulgated by the Pension
Benefit Guaranty Corporation for
single employer terminations
occurring on the first day of the
Plan Year of the date of payment.
1.3 "Affiliate" means any corporation or unincorporated
business in control of, controlled by, or under
common control with, the Company within the
meaning of Sections 414(b) and (c) of the Code and
any organization which is a member of an affiliated
service group of which the Company is a member
within the meaning of Section 414(m) of the Code;
provided, however, that, for the purposes of the
limitations upon the benefits of a Member contained
in Article IX, "Affiliate" status shall be determined in
accordance with Section 415(h) of the Code. Except
to the extent approved by the Board of Directors, a
corporation or unincorporated business shall not be
deemed an Affiliate for any purpose under the Plan
with respect to any period before it becomes an
Affiliate.
1.4 "Benefit Commencement Date" means the date on
which a Member's benefit payments commence under
the Plan.
1.5 "Board of Directors" means the Board of Directors of
Salant Corporation.
1.6 "Code" means the Internal Revenue Code of 1986, as
amended.
1.7 "Committee" means the person or persons appointed
by the Board to administer the Plan.
1.8 "Company" means Salant Corporation and any other
Affiliate or other entity which, with the consent of the
Board of Directors, has adopted the Plan and any
successor to such Company. Each participating
Company delegates all such rights, powers, and
duties, including amendment or termination of the
Plan, to Salant Corporation. Appendix A to the Plan
lists the Companies that have adopted the Plan and
the effective date of such adoption.
1.9 "Deferred Retirement" means a Member's retirement
after his Normal Retirement Date.
1.10 "Deferred Retirement Date" means the first day of the
month coincident with or next following a Member's
Deferred Retirement.
1.11 "Early Retirement Age" means (a) the date a Member
has both (1) attained his 55th birthday and (2)
completed a 10-year period of Vesting Service, or (b)
with respect to Members whose Severance from
Service Date is prior to January 1, 1994, the date the
Member has both (1) attained his 60th birthday and (2)
completed a 10-year period of Vesting Service.
1.12 "Early Retirement Date" means (a) the first day of
any month before his Normal Retirement Age as of
which a Member elects to retire provided he has
attained his Early Retirement Age by such date.
1.13 "Effective Date" means January 1, 1979.
1.14 "Eligible Spouse" means the person to whom a
Member has been legally married during the 12-
month period immediately preceding the Member's
date of death, if such death is earlier than his Benefit
Commencement Date, or the person to whom a
Member is legally married as of such date, if
applicable.
1.15 "Employee" means any person, including officers,
employed by the Company who is classified by the
Committee under uniform rules as other than a regular
salaried, office, sales, security, supervisory or
technical employee, provided that no person shall be
an Employee if such person is included in a unit of
employees covered by a collective bargaining
agreement between employee representatives and the
Company or an Affiliate, unless such agreement
provides that such employees shall be eligible to
participate in the Plan.
1.16 "Employment Commencement Date" means the date
on which an Employee first performs an Hour of
Service for the Company.
1.17 "ERISA" means the Employee Retirement Income
Security Act of 1974, as amended.
1.18 "Hour of Service" means -
(a) each hour for which an Employee is paid or
entitled to payment, by the
Company for the performance of
duties for the Company, credited
for the Plan Year or other
computation period in which such
duties were performed; or
(b) each hour of a period
during which no duties are
performed due to vacation, holiday,
illness, incapacity, layoff, jury
duty, military duty or leave of
absence; and
(c) each hour for which an
Employee has been awarded, or is
otherwise entitled to, back pay
from the Company, irrespective of
mitigation of damages, if he is not
entitled to credit for such hour
under any other Subsection of this
Section 1.18.
1.19 "Member" means an Employee who satisfies the
requirements for Membership pursuant to Article III,
and whose Membership shall not have terminated
pursuant to such Article and any former Employee
who is receiving or is entitled to receive a deferred
benefit under the Plan.
1.20 "Normal Retirement Age" means the later of (a) the
date a Member attains his 65th birthday and (b) the
fifth anniversary of the commencement of his
participation in the Plan.
1.21 "Normal Retirement Date" means the first day of the
month coinciding with or next following a Member's
Normal Retirement Age.
1.22 "Period of Service" means a period of Service
commencing on an Employee's Employment
Commencement Date or Reemployment
Commencement Date, whichever is applicable, and
ending on the earlier of the first anniversary of the
date on which an Employee began a period of
absence for any reason other than quit, retirement,
discharge or death, and his Severance from Service
Date, except as provided in Sections 2.1, 2.2, and 2.3
for purposes of, respectively, eligibility, benefit
accrual and vesting.
The length of each Period
of Service shall be equal to the
number of complete years in such
Period of Service, counting from
the Employment Commencement
Date on which it began, and
including each month as 1/12 of a
year and each partial month as a
full month.
1.23 "Period of Severance" means the period of time
commencing on an Employee's Severance from
Service Date and ending on the date on which the
Employee again performs an Hour of Service for the
Company.
1.24 "Plan" means the provisions of the Salant Corporation
Pension Plan as restated effective December 1, 1988
and set forth herein.
1.25 "Plan Administrator" means Salant Corporation.
1.26 "Plan Year" means the eleven-month period beginning
on January 1, 1979 and ending on November 30,
1979; each twelve month period beginning on
December 1 and ending on November 30 from
December 1, 1979 through November 30, 1991; the
month of December 1991; and each calendar year
thereafter.
1.27 "Reemployment Commencement Date" means the first
day following a Period of Severance on which an
Employee performs an Hour of Service for the
Company.
1.28 "Retirement Date" means the Member's Early
Retirement Date, Normal Retirement Date or Deferred
Retirement Date, as the case may be.
1.29 "Service" means an Employee's period of employment
with the Company credited in accordance with Article
II.
Service shall include periods
during which an Employee is
absent for military service provided
employment is resumed within the
period prescribed by the statutes of
the United States, as from time to
time in effect, for the exercise of
veteran's reemployment rights and
periods during which an employee
is absent pursuant to an authorized
leave of absence approved by the
Committee under uniform rules.
Service with an Affiliate shall be
taken into account as provided
under Section 2.1 and 2.3 for
purposes of, respectively, eligibility
and vesting. For this purpose,
(a) the word "Company" shall be replaced by
the term "Company or Affiliate" whenever it
appears in Sections 1.16, 1.18, 1.23, 1.27 and
1.30; and
(b) the word "Employee" when used in those
Sections enumerated in Subsection (a) shall
include a person employed by an Affiliate.
To the extent that such periods
would have counted as Service had
the employer then been the
Company, Service shall also
include periods of employment by
any employer acting as a field
warehouseman if such employment
is determined by the Committee to
be solely in connection with a field
warehousing arrangement with the
Company.
1.30 "Severance from Service
Date" means the earlier of (a) the
date on which an Employee quits,
retires, is discharged or dies, and
(b) the later of (1) the first
anniversary of the first day of a
period in which an Employee
remains absent from Service (with
or without pay) with the Company
for any reason other than quit,
retirement, discharge or death, such
as vacation, holiday, sickness,
disability, leave of absence or
layoff, and (2) the second
anniversary of the date on which
an Employee began a period of
absence for any reason other than
quit, retirement, discharge or death,
if his absence beyond the first
anniversary of the date on which
he began such absence is by reason
of the pregnancy of such
Employee, the birth of a child of
such Employee, the placement of a
child in connection with the
adoption of such child by the
Employee, or the caring for such
child for a period beginning
immediately following such birth
or placement.
1.31 "Social Security Retirement Age" means, in the case
of a Member born before January l, l938, age 65; in
the case of a Member born after December 3l, l937
and before January l, l955, age 66; and in the case of
a Member born after December 3l, l954, age 67.
1.32 "Spousal Consent" means, with respect to the election
by a Member to waive the Qualified Joint and
Survivor Annuity form pursuant to Section 7.2, that
(a) the Member's Eligible
Spouse consents in writing to such
election, and the Spouse's consent
acknowledges the effect of such
election and is witnessed by a
Member of the Committee or by a
notary public; or
(b) it is established to the
Committee's satisfaction that the
consent required under Subsection
(a) hereof is unobtainable because
the Member is unmarried, because
the Member's Eligible Spouse
cannot be located, or because of
such other circumstances as the
Secretary of the Treasury may by
regulation prescribe.
Any such consent and any such
determination as to the
impossibility of obtaining such
consent shall be effective only with
respect to the individual who signs
such consent or with respect to
whom such determination is made
and not with respect to any
individual who may subsequently
become the Eligible Spouse of
such Member.
1.33 "Trust" or "Trust Fund" means the trust established
pursuant to the Trust Agreement to hold the assets of
the Plan. The assets of the Plan may be held in one
or more Trust Funds.
1.34 "Trust Agreement" means the agreement entered into
between the Company and the Trustee pursuant to
which the Trustee holds the Trust Fund.
1.35 "Trustee" means anyone serving as trustee under the
Trust Agreement.
The masculine pronoun
whenever used shall include the
feminine and the singular shall
include the plural.
ARTICLE II
SERVICE
2.1 Eligibility Service
Eligibility Service means the
aggregate Period of Service
credited to an Employee and not
forfeited due to a Period of
Severance in accordance with
Section 2.4(a)(1). For purposes of
this Section 2.1, the aggregate
Period of Service credited to an
Employee shall include each Period
of Service as an employee of the
Company not included in the
definition of Employee under
Section 1.15, each Period of
Service with an Affiliated
Company, each Period of
Severance taken into account under
Section 2.4(b) and in the case of
an individual who was an
employee of Denton Mills, Inc. on
the date on which it became an
Affiliate, the period of his
continuous employment by Denton
Mills, Inc. prior to such date.
2.2 Benefit Accrual Service
Benefit Accrual Service means the
aggregate Period of Service
credited to an Employee with the
exception of:
(a) any Period of Service forfeited due to a
Period of Severance in accordance with
Section 2.4(a)(1), and
(b) in the case of a Member who is not
credited with an Hour or Service on or after
December 1, 1988, any Period of Service
credited after his Normal Retirement Age,
(c) any Period of Service credited to a
Member at a location listed below prior to the
corresponding "benefit accrual start date"
Location
Benefit Accrual Start Date
Shultz Manufacturing August 1, 1967
Eagle Pass December 1,
1976
El Paso December 1,
1976
Del Rio December 1,
1976
Gibson June 12,
1978
West Dallas January 1, 1992
Denton Mills January 1, 1992
(d) any Period of Service by an individual
while he is not classified as an Employee.
Notwithstanding the above, to
determine a Member's period of
Benefit Accrual Service prior to
January 1, 1982, he shall be
considered to have completed a
one-year Period of Benefit Accrual
Service for each year of credited
service earned in accordance with
the provisions of the Plan as then
in effect and shall receive credit
for a one-year Period of Benefit
Accrual Service for each year of
such credited service.
2.3 Vesting Service
Vesting Service means whole years
of the aggregate Period of Service
credited to an Employee, whether
or not such Periods of Service
were rendered consecutively.
For purposes of this Section 2.3, the aggregate
Periods of Service credited to an Employee shall
include each Period of Service while an employee not
included in the definition of Employee under Section
1.15, each Period of Service with an Affiliated
Company, each Period of Severance taken into
account under Section 2.4(b) and, in the case of an
individual who was an employee of Denton Mills,
Inc. on the date, on which it became an Affiliate,
the
period of his continuous employment by Denton
Mills, Inc. prior to such date.
Notwithstanding the foregoing,
however, such aggregate Period of
Service shall not include any
Period of Service forfeited due to a
Period of Severance in accordance
with Section 2.4(a)(2).
Notwithstanding the above, to
determine a Member's period of
Vesting Service prior to January 1,
1982, he shall be considered to
have completed a one-year Period
of Vesting Service for each year of
credited service earned in
accordance with the provisions of
the Plan as then in effect and shall
receive credit for a one-year Period
of Vesting Service for each year of
such credited service.
2.4 Period of Severance:
(a) Effect of a Period of Severance
(1) an Employee
who incurs a Period of
Severance before he has a
vested interest under the
Plan that equals or exceeds
the greater of (A) his Period
of Eligibility Service
credited prior to such
Period of Severance and (B)
five years, shall forfeit the
Period of Eligibility Service
and Period of Benefit
Accrual Service previously
credited to him.
(2) an Employee who incurs a Period of
Severance before he has a vested interest
under the Plan that equals or exceeds the
greater of (A) his Period of Vesting Service
credited prior to the Period of Severance and
(B) five years, shall forfeit the Period of
Vesting Service previously credited to him.
(3) the Period of Service of a person who
incurs a Period of Severance shall include
Service following such Period of Severance
but
shall not include Service prior to such
Period of Severance until such person
completes a 12 consecutive month Period of
Service following such Period of Severance.
(b) Crediting of Period of Severance
(1) if an Employee has a Severance from
Service Date by reason of a quit, discharge or
retirement and then performs an Hour of
Service within 12 months of his Severance
from Service Date, the Period of Severance
shall be taken into account for purposes of
determining his aggregate Periods of Service
under Sections 2.1 and 2.3.
(2) if an Employee has a Severance from
Service Date by reason of a quit, discharge or
retirement during a period of 12 months or
less in which the Employee remains absent
from Service for any reason other than a quit,
discharge, retirement or death and then
performs an Hour of Service within 12 months
of the date on which he was first absent from
service, the Period of Severance shall be taken
into account for purposes of determining his
aggregate Periods of Service under Sections
2.1 and 2.3.
ARTICLE III
MEMBERSHIP
3.1 Each Employee who was a Member of the Plan
immediately preceding the effective date of this
amendment and restatement shall participate in this
Plan in accordance with the provisions of the Plan in
effect on and after such effective date.
3.2 Each other Employee shall become a Member of the
Plan on the January 1, April 1, July 1 or October 1
coinciding with or next following the later of (a) the
date on which he becomes an Employee as defined in
section 1.15 and (b) the date on which he attains his
21st birthday, and is credited with a one-year Period of
Eligibility Service, provided, however, that (i) an
Employee hired before July 1, 1993 shall become a
Member of the Plan on the January 1 or July 1
coinciding with or next following the later of (a) the
date on which he becomes an Employee as defined in
section 1.18 and (b) the earlier of the date on which he
attains his 21st birthday, or is credited with a two-year
Period of Eligibility Service, and (ii) an Employee
hired before December 1, 1988 who had attained age
60 prior to his Employment Commencement Date shall
become a Member of the Plan on the later of December
1, 1988 and the January 1 or July 1 coinciding with or
next following the date on which he is credited with a
one-year period of Eligibility Service.
3.3 A Member of the Plan who forfeits his Period of
Eligibility Service due to a Period of Severance in
accordance with Section 2.4(a)(1) will cease to be a
Member of the Plan. He may re-enter the Plan as a
new Member by again satisfying the Membership
requirements in accordance with Section 3.2. If a
Member has a Period of Severance of at least one
year but does not forfeit his Period of Eligibility
Service in accordance with Section 2.4(a)(1), he is
eligible to participate immediately upon his
Reemployment Commencement Date.
ART ICLE IV
ELI GIBILITY FOR PLAN BENEFITS
4.1 Normal Retirement Benefit
A Member shall be eligible for a
Normal Retirement Benefit if his
employment is terminated on or
after his attainment of his Normal
Retirement Age but on or
immediately before his attainment
of his Normal Retirement Date.
4.2 Early Retirement Benefit
A Member shall be eligible for an
Early Retirement Benefit if his
employment is terminated before
he attains his Normal Retirement
Age but on or after his attainment
of his Early Retirement Age.
4.3 Vested Deferred Benefit
A Member shall be eligible for a
Vested Deferred Benefit if his
employment is terminated for any
reason other than death or
retirement and after he has a vested
interest under the Plan.
4.4 Deferred Retirement Benefit
A Member shall be eligible for a
Deferred Retirement Benefit if his
employment is terminated after his
Normal Retirement Date.
4.5 Spouse's Benefit
A Member shall be eligible to have
a Spouse's Benefit provided for his
Eligible Spouse if he dies prior to
his Benefit Commencement Date
survived by an Eligible Spouse and
is vested in any portion of his
Accrued Benefit.
4.6 Death Benefit
A Member who is not survived by an Eligible Spouse shall be
eligible to have a Death Benefit provided for his surviving children
who have not attained age 23 if he dies while an active Employee
and prior to his Benefit Commencement Date, if he has been
credited with a Period of Vesting Service of at least 10 years and
has attained age 60.
ART ICLE V
BEN EFIT ACCRUAL
5.1 Accrued Benefit
Subject to Subsection 7.10(g), each
Member shall accrue a monthly
benefit equal to $3.00 multiplied
by his Period of Benefit Accrual
Service through November 30,
1988 and $8.00 multiplied by his
Period of Benefit Accrual Service
after November 30, 1988. For this
purpose, if the Member's Period of
Benefit Accrual Service exceeds 30
years, those years of a Member's
Benefit Accrual Service shall be
applied which produce the greatest
Accrued Benefit.
ART ICLE VI
AMO UNT OF BENEFIT
6.1 Amount of Normal Retirement Benefit
A Member's Normal Retirement
Benefit shall be the amount
determined in either (a) or (b),
whichever is applicable.
(a) A Member who
retires on the Life Annuity form
described in Section 7.3 shall
receive a monthly benefit equal to
the Accrued Benefit determined in
Section 5.1.
(b) A Member who
retires on a form of annuity other
than the Life Annuity form shall
receive a monthly benefit equal to
the Actuarial Equivalent of the
Accrued Benefit determined in
Section 5.1.
In no event, however, shall a
Member's Normal Retirement
Benefit be less than the greatest
Early Retirement Benefit he would
have been entitled to receive if he
had retired early under the
provisions of Section 4.2.
6.2 Amount of Early Retirement Benefit
A Member who elects to retire at
an Early Retirement Date shall
receive a monthly benefit equal to
the Actuarial Equivalent of his
Normal Retirement Benefit.
6.3 Amount of Vested Deferred Benefit
(a) For a Member
whose Severance from Service
Date is on or after December 1,
1989, the monthly amount of his
Vested Deferred Benefit
commencing at his Normal
Retirement Date on the Life
Annuity form, as described in
Section 7.3, shall be equal to a
percentage, in accordance with the
following schedule, of the Accrued
Benefit, as determined in Section
5.1:
Period of Vesting Service
Percentage Vested
less than 5 years 0
5 or more years 100
(b) The monthly amount of a Member's
Vested Deferred Benefit commencing at his Normal
Retirement Date on a form other than the Life
Annuity form, as described in Section 7.3, shall be
equal to the Actuarial Equivalent of the amount
otherwise determined under subsection (a), above.
Subject to Section 7.10, a Member may elect to
receive his Vested Deferred Benefit at an Early
Retirement Date, in which case such benefit shall be
equal to the Actuarial Equivalent of the amount
otherwise determined under this Section 6.3.
6.4 Amount of Deferred Retirement Benefit
Subject to Section 7.10 and 7.11, a Member's
Deferred Retirement Benefit shall commence on his
Deferred Retirement Date and shall be a monthly
benefit equal to the greater of (a) his Accrued
Benefit
as of his Benefit Commencement Date and (b) the
Actuarial Equivalent of his Normal Retirement
Benefit determined as of his Benefit Commencement
Date.
6.5 Amount of Disability Benefit
(a) If a Member with at least 15 years of
Service becomes totally and permanently disabled
while in the service of the Company so that he is
eligible for, and receiving, Social Security
disability
benefits, he may be retired and receive during the
period of disability, as determined from time to time
by evidence of such disability satisfactory to the
Committee, commencing on the first day of the sixth
month following such disability an annual disability
retirement benefit on the Life Annuity form, as
described in Section 7.3, equal to his Accrued
Benefit.
(b) The monthly amount of a Member's
Disability Benefit on a form other than the Life
Annuity form, as described in Section 7.3, shall be
equal to the Actuarial Equivalent of the amount
otherwise determined under subsection (a) above.
6.6 Amount of Spouse's Benefit
The Spouse's Benefit payable for life to a Member's
Eligible Spouse shall be:
(a) in the case of a Member who dies on or
after his Early Retirement Date, the annuity to which
such Member's Eligible Spouse would have been
entitled if the Member had retired on the day before
his death and his retirement benefit had been payable
in the Qualified Joint and Survivor Annuity form,
reduced in accordance with Section 6.2; and
(b) in the case of a Member who dies prior to
his Early Retirement Date, the annuity to which his
Eligible Spouse would have been entitled if the
Member's Severance from Service Date had occurred
on the date of his death (if the Member had not
already had a Severance from Service prior to the
date of his death), and such Member had survived to
his Early Retirement Date, had retired immediately
upon attainment of his Early Retirement Date with an
immediate Qualified Joint and Survivor Annuity form,
reduced as provided in Section 6.2, and had died on
the day next succeeding such retirement. The annuity
described in this Subsection (b) shall commence to be
payable, at the election of such Spouse, as of the
first
day of any month coincident with or next following
the date on which the Member would have attained
his Early Retirement Date.
6.7 Amount of Death Benefit
Any Member who is not eligible
for a Spouse's Benefit under
Section 6.6 is eligible for a death
benefit if he has at least 10 years
of Service and has attained age 60.
If after becoming eligible for the
death benefit provided by this
Section, a Member dies prior to the
commencement date of his
retirement benefits, a death benefit
shall be paid to his surviving
children who have not attained age
23.
The death benefit shall be paid
monthly in equal shares to each of
the Member's surviving children
who shall not have attained age 23
at the time of the Member's death.
The aggregate amount of the death
benefit payable to such children
upon the Member's death shall be
equal to the value of the amount of
a Spouse's Benefit that would have
been payable to a hypothetical
surviving spouse of the Member
born on the third anniversary of the
Member's birth. The death benefit
payable to each such child shall be
continued until such child attains
age 23 or dies, whichever occurs
first. The amount payable to any
such child shall not be increased
by reason of the termination of the
payment of benefits to any other
child.
ART ICLE VII
MAN NER AND FORM OF PAYMENT
7.1 A Member's Retirement Benefit or Vested Deferred
Benefit shall, except as provided under Section 7.6,
7.7 or 7.8, be payable as an annuity commencing on
the Member's Retirement Date, or as of the first day
of the month coinciding with or next following his
termination of employment, if later. The annuity shall
be paid on one of the forms described in the
following paragraphs of this Article.
7.2 A Member who has an Eligible Spouse at his Benefit
Commencement Date shall have his benefit paid on
the Qualified Joint and Survivor Annuity form under
Section 7.4. However, such Member may, prior to
his Benefit Commencement Date and subject to
Spousal Consent, elect in writing and on a form
provided by the Plan Administrator, not to have his
benefit paid in this manner and may, prior to such
Benefit Commencement Date, instead elect, in writing
and on a form provided by the Plan Administrator, to
have his benefit paid on the Life Annuity form under
Section 7.3.
No less than 90 days before the
Member's Benefit Commencement
Date, the Plan Administrator shall
furnish the Member with written
notification of the availability of
making an election not to have his
benefit paid on the Qualified Joint
and Survivor Annuity form. This
notification shall also inform the
Member that he may request an
explanation of the terms,
conditions and financial effect of
making such elections. Any
explanation shall be furnished to
the Member within 30 days of his
request provided the Member
furnishes the Plan Administrator
with proof of the date of birth of
his Eligible Spouse and such other
information as the Plan
Administrator may require the
Member to provide in order to give
such explanation.
A Member who elects not to have
his benefit paid on the Qualified
Joint and Survivor Annuity form
may revoke such election at any
time prior to his Benefit
Commencement Date.
A Member who does not have an
Eligible Spouse at his Benefit
Commencement Date shall have
his benefit paid on the Life
Annuity form under Section 7.3.
7.3 Life Annuity form provides for monthly payments to
the Member continuing to the first day of the month
in which his death occurs.
7.4 Qualified Joint and Survivor Annuity form provides
for a monthly benefit payable during the lifetime of
the Member and upon his death 50% of such monthly
benefit payable to his Eligible Spouse for the Eligible
Spouse's lifetime. No benefit shall be payable after
the death of the Member and his Eligible Spouse.
7.5 Payment of Spouse's Benefit
(a) The Spouse's Benefit shall commence
to be paid on the first day of the month next
following the later of the Member's death or the date
on which the Member would have attained Early
Retirement Age.
(b) A surviving Spouse may elect that the
Spouse's Benefit commence on the first day of any
month following the date specified in Subsection(a)
subject to the limitations of Section 7.11.
(c) If a surviving Spouse elects to defer
payment pursuant to Subsection (b), the annuity
payable to such Spouse shall be the Actuarial
Equivalent of the annuity payable as of the date
specified in Subsection (a).
7.6 Payment of Death Benefit
The Death Benefit payable under Section 6.7 shall
commence to be paid on the first day of the month
next following the date of the member's death.
7.7 Small Benefit Payments
In the case of a Member whose Severance from Service
is after December 31, 1991, the Trustee shall distribute
to the Member or his Spouse, as the case may be, as
soon as practicable after the Member's Severance from
Service, in a single lump sum payment the Actuarial
Equivalent of the Member's vested Accrued Benefit, if
the amount of such distribution does not exceed
$3,500. In the case of a Member whose Severance from
Service is before January 1, 1992, the Trustee shall
distribute to the Member or his Spouse, as the case
may be, as soon as practicable after the Member's
Retirement Date, in a single lump sum payment the
Actuarial Equivalent of the Member's vested Accrued
Benefit, if the amount of such distribution does not
exceed $3,500. A Member with no vested interest in his
Accrued Benefit as of his Severance from Service shall
be deemed to have received a distribution of his entire
vested Accrued Benefit of zero dollars as of his
Severance from Service.
7.8 Qualified Domestic Relations Order - If required to do
so by a qualified domestic relations order, as defined in
Section 414(p) of the Code, the Trustee may commence
distribution of all or a portion of a Member's Accrued
Benefit to an alternate payee, as defined in Section
414(p) of the Code, at a time after the Member attains
age 50, but prior to the Member's Retirement Date or
termination of employment.
7.9 Retirement Benefit Payments - The annual retirement
benefits for life shall be payable in monthly
installments and shall end with the last monthly
payment prior to the death of the Member, or his
beneficiary if receiving benefits.
7.10 Reemployment after Retirement - If any retired
Member is reemployed by the Company, his
retirement benefit payments, if any, shall cease until
his subsequent retirement and his Service and
Credited Service shall be restored to him but the
benefit payable upon the Member's subsequent
retirement or death shall be reduced (but not to less
than zero) by the Actuarial Equivalent of any
payments under the Plan previously received by the
Member and by the cost of any retirement benefit
coverage of the Member's beneficiary under the Plan
during such reemployment provided that no reduction
shall be made for Disability Benefits received under
Section 6.5.
7.11 Required Distributions
Notwithstanding anything to the contrary contained in
this Plan --
(a) The entire interest of each Member
must either:
(1) be paid to him not later than the April
1st next following the close of his taxable year
in which he attains age seventy and one-half
(70-1/2); or
(2) commence to be paid to him not
later than the date specified in Paragraph (1)
and payable, in accordance with regulations
prescribed by the Secretary of the Treasury,
over a period not extending beyond the life of
such Member or the joint lives of such
Member and his designated beneficiary, or the
life expectancy of such Member or the joint
and last survivor life expectancy of such
Member and his designated beneficiary;
provided, however, that if the distribution of a
Member's Retirement Benefit has
commenced in accordance with this Paragraph
(2), any portion remaining to be distributed at
such Member's death shall continue to be
distributed at least as rapidly as under the
method of distribution in effect as of such
Member's death.
(b) If a Member has died prior to the
commencement of distributions to him in accordance
with Paragaraph (a)(2), the entire interest of such
Member shall be distributed:
(1) within five (5) years after the death of
such Member, or
(2) where distribution is to be made to the
Member's designated beneficiary, commencing
(A) within one (1) year (or such
longer time as the Secretary of the
Treasury may be regulations prescribe)
after the Member's death, or
(B) if the designated beneficiary is
such Member's surviving Spouse, no
later than the date on which such
Member would have attained age
seventy and one-half (70-1/2), and
payable, in accordance with regulations
prescribed by the Secretary of Treasury,
over a period not extending beyond the
life expectancy of such designated
beneficiary.
(c) For purposes of Paragraphs (a)(2) and (b)(2),
at the election of the Member or a surviving
Spouse the life expectancy of a Member
and/or his Spouse may be redetermined, but
not more often than annually. In the absence
of such an election, life expectancies shall not
be redetermined once benefit distribution has
commenced.
(d) Under regulations prescribed by the Secretary
of the Treasury, any amount paid to a
Member's child shall be treated as if it had
been paid to such Member's surviving Spouse
if such amount will become payable to such
spouse upon the child reaching maturity or
such other designated event which may be
permitted under such regulations.
(e) For purposes of this Section 7.11, the term
"designated beneficiary" shall mean a
Member's surviving Spouse or an individual
designated by the Member pursuant to Section
15.5.
(f) Notwithstanding anything in the Plan to the
contrary, the form and timing of all
distributions under the Plan shall be in
accordance with regulations issued by the
Department of the Treasury under section
401(a)(9) of the Code, including the incidental
death benefit requirements of section
401(a)(9)(g) of the Code.
7.12 Direct Transfers - If a Member who is entitled to a
distribution of at least $200 which is an "eligible
rollover distribution," as defined in Code Section
402(f)(2)(A), elects in writing on a form provided by
the Plan Administrator to have such distribution, or a
portion of such distribution equal to at least $500 (or
the entire distribution if less than $500) paid directly
to a specified "eligible retirement plan," as defined in
Code Section 402(c)(8)(B), which is a defined
contribution plan the terms of which permit the
acceptance of rollover distributions, the portion of
such distribution which would otherwise be includible
in the Mermber's gross income shall be distributed in
the form of a direct trustee-to-trustee transfer to the
eligible retirement plan so specified.
ARTI CLE VIII
CONT RIBUTIONS AND FUNDING
8.1 The Plan shall be funded for the exclusive purposes
of providing benefits to Members and their
beneficiaries and for defraying reasonable expenses in
administering the Plan.
8.2 All contributions to the Plan shall be made to the
Trust and all benefit payments shall be held in the
Trust.
8.3 Contributions to the Plan shall not be returned to the
Company, except in the following instances:
(a) In the case of a contribution made by
the Company pursuant to a mistake in fact, such
contribution shall be returned to the Company within
one year after the payment of the contribution.
(b) Each contribution to the Plan is hereby
conditioned on its deductibility under Section 404 of
the Code, and if any part or all of a contribution is
disallowed, then to the extent of such disallowance
the contribution shall be returned to the Company.
8.4 Forfeitures resulting from a Member's early
retirement, termination of employment or death shall
not be applied to increase the benefit that any
Member would otherwise receive under the Plan and
shall be applied as soon as possible to reduce
Company contributions.
ART ICLE IX
LIM ITATIONS ON BENEFITS AND CONTRIBUTIONS
9.1 As used in this Article IX -
(a) "Annual Addition," for a
Limitation Year, means, in the case of any Defined
Contribution Plan, the aggregate of -
(1) the amount of a
Member's voluntary contributions for the Limitation
Year; and
(2) Employer contributions
and forfeitures allocated to the Member's accounts
for
the Limitation Year.
(b) "Annual Benefit" under a
Defined Benefit Plan means a retirement benefit
payable annually in the form of a straight life
annuity
under such plan.
For purposes of this Subsection
(b) -
(1) if a retirement benefit is
provided in a form other than a straight life annuity
or
a qualified joint and survivor annuity (within the
meaning of Section 417(b)(1) of the Code), such
benefit shall be adjusted (in accordance with
regulations prescribed by the Secretary) to an
equivalent benefit in the form of a straight life
annuity on the basis of the actuarial assumptions
specified in Section 1.2 for optional forms of
payment
other than the lump sum option (except that the
interest rate assumption shall be 5% if the rate
specified is less than 5%);
(2) if a retirement benefit is
provided in the form of a qualified joint and
survivor
annuity (within the meaning of Section 417(b)(1) of
the Code) which includes additional post-retirement
death benefits, such benefit need not be adjusted to
the extent the value of the benefit in such form
exceeds the sum of (A) the value of a straight life
annuity and (B) the value of any post retirement
death
benefits that would be payable even if the annuity
was not in the form of a joint and survivor annuity;
(3) if such annual retirement
benefit is attributable in part to employee
contributions or to roll-over contributions (as
defined
in Section 402(a)(5), 403(a)(4) or 408(d)(3) of the
Code or Section 409(b)(3)(C) of the Code as in effect
prior to 1984), the annual retirement benefit shall
be
reduced on the basis of the actuarial assumptions
specified in Section 1.2 for optional forms of
payment
other than the lump sum option (except that the
interest rate assumption shall be 5% if the rate
specified is less than 5%) so that it will be the
equivalent of an annual retirement benefit derived
solely from employer contributions.
(c) "Defined Benefit Plan" means
any Retirement Plan that is not a Defined
Contribution Plan.
(d) "Defined Benefit Plan Fraction,"
for a Limitation Year, means a fraction,
(1) the numerator of which
is the aggregate Projected Annual Benefit (determined
as of the last day of the Limitation Year) of the
Member under all Defined Benefit Plans, and
(2) the denominator of
which is the greater of -
(A) an amount equal
to the lesser of -
(i) the product of
1.25 and the dollar limitation in effect under
Section
415(b)(1)(A) of the Code for such Limitation Year
(adjusted as described in Subsections 9.2(d) and
(e)),
or
(ii) the product
of 1.4 and the aggregate Projected Annual Benefit
(determined as of the last day of the Limitation
Year)
that the Member would receive under all such plans if
the plans, in the aggregate, provided the benefit
described in Section 415(b)(1)(B) of the Code; or
(B) in the case of an
individual who participated in a Defined Benefit Plan
that was in existence on July 1, 1982, the product of
1.25 and his Accrued Benefit under the Plan. For
purposes of this Subparagraph (B) and Paragraph
9.2(a)(2), an individual's "Accrued Benefit" under a
Defined Benefit Plan means the individual's accrued
benefit under the Plan (determined as of the end of
the last Plan Year beginning before January 1, 1983),
expressed as an annual benefit (within the meaning of
Section 415(b)(2) of the Code as in effect before the
amendments made by the Tax Equity and Fiscal
Responsibility Act of 1982).
(C) in the case of an
individual who participated in a Defined Benefit Plan
that was in existence on May 6, l986, the product of
l.25 and his Accrued Benefit under the Plan. For
purposes of this Subparagraph (C) and Paragraph
9.2(a)(2), an individual's "Accrued Benefit" under a
Defined Benefit Plan means the individual's accrued
benefit under the plan (determined as of the end of
the last plan year beginning before January l, l987),
expressed as an annual benefit (within the meaning of
Section 4l5(b)(2) of the Code as in effect before the
amendments made by the Tax Reform Act of l986).
(e) "Defined Contribution Plan" means a
Retirement Plan that provides for an individual
account for each Member and for benefits based
solely on the amount contributed to such account and
any income, expense, gains, losses, and forfeitures
of
accounts of other Members in respect of such account.
(f) "Defined Contribution Plan Fraction,"
for a Limitation Year, means a fraction,
(1) the numerator of which is the
sum of the Annual Additions to a Member's accounts
under all Defined Contribution Plans, as of the close
of the Limitation Year and for all prior Limitation
Years, and
(2) the denominator of which is the
sum of the lesser of the following amounts,
determined for such Limitation Year and for each
prior year of the Member's service with the Company
or an Affiliate:
(A) the product of 1.25 and
the dollar limitation in effect under Section
415(c)(1)(A) of the Code, or
(B) the product of 1.4 and
the amount that may be taken into account under
Section 415(c)(1)(B) of the Code; provided, however,
(3) the Company may elect, on a
uniform and nondiscriminatory basis, to make use of
the special transition rule of Section 415(e)(6) of
the
Code applicable to plan years ending before January
1, 1983, and Section 1106(i)(4) of the Tax Reform
Act of 1986 applicable to years ending before January
1, 1987, to determine the denominator of the Defined
Contribution Plan Fraction, and
(4) in accordance with regulations
promulgated under Section 415 of the Code, the
portion of the numerator of the Defined Contribution
Plan Fraction attributable to Limitation Years
beginning before January 1, 1983, or January 1, 1987,
as the case may be, shall be reduced, to the extent
necessary, so that the sum of the Defined Benefit
Plan
Fraction and Defined Contribution Plan Fraction for
the last Limitation Year beginning before January 1,
1983, or January 1, 1987, as the case may be, does
not exceed one (1.0).
(g) "Limitation Year" means the Plan Year.
(h) A Member's "Projected Annual
Benefit" under a Defined Benefit Plan shall be equal
to the Annual Benefit to which he would be entitled
under such plan if he were to continue employment
until his normal retirement age under such plan (or
until his current age, if later), his Section 415
Compensation for the Limitation Year under
consideration remains the same until the date he
attains such age, and all other relevant factors used
to
determine benefits under the plan were to remain the
same as in the current Limitation Year for all future
Limitation Years.
(i) "Retirement Plan" means any plan
maintained by the Company or an Affiliate that is (A)
a pension, profit sharing or stock bonus plan,
described in Section 401 (a) and 501(a) of the Code,
(B) an annuity plan or annuity contract described in
Section 403(a) of the Code, (C) a simplified employee
pension plan described in Section 408(k) of the Code,
or (D) a qualified bond purchase plan described in
Section 405(a) of the Code. In addition, Retirement
Plan shall include (A) an individual retirement
account or an individual retirement annuity described
in Section 408(a) or 408(b) of the Code (or an
individual retirement bond described in 409 of the
Code as in effect prior to 1984), or an annuity
contract described in Section 403(b) of the Code, if
such account or annuity (or bond) is considered to be
maintained by the Company or an Affiliate under
Section 1.415-7(h) or (i) of the Federal Income Tax
Regulations and (B) a program of voluntary
contributions contained in a defined benefit pension
plan.
(j) "Section 415 Compensation," for any
period, means an individual's current compensation
from the Company or an Affiliate required to be
reported on Form W-2 for such period, including
those items listed in Paragraph (1) of Section 1.415-
2(d) of the Federal Income Tax Regulations but
excluding those items listed in Paragraph (2)
thereof.
9.2 (a) Notwithstanding anything in this Plan
to the contrary, the Annual Benefit to which a
Member is entitled at any time under this Plan, when
added to his aggregate Annual Benefit under all other
Defined Benefit Plans, shall not, during a Limitation
Year exceed the greater of -
(1) the lesser of -
(A)$90,000, or
(B) 100 percent
(100%) of the average of his Section 415
Compensation for his high three (3) consecutive
calendar years during which he was a Member of the
Plan, or
(2) in the case of an
individual who was a Member prior to January 1,
1983, his Accrued Benefit as defined in Subparagraph
9.1(d)(2)(B).
(3) in the case of an
individual who was a Member prior to January 1,
1987, his Accrued Benefit as defined in Subparagraph
9.1(d)(2)(C)
(b) The Annual Benefit payable under this
Plan with respect to which a Member shall be deemed
to meet the requirements of Paragraph (a)(1) if -
(1) such Member's Annual
Benefit, when added to his aggregate Annual Benefit
under all other Defined Benefit Plans, does not
exceed
$10,000 for the current Limitation Year and for any
prior Limitation Year, and
(2) such Member has not at
any time participated in a Defined Contribution Plan.
(c) In the case of a Member who has
completed fewer than ten (10) years of participation
in the Plan, the maximum Annual Benefit allowable
under this Plan shall be computed by multiplying the
amount determined under Subsection (a) or (b),
whichever is applicable, by a fraction, the numerator
of which shall be the aggregate of his years of
participation and the denominator of which shall be
ten (10). The provisions of the previous sentence
shall apply to the limitations under Subparagraph
(a)(l)(B) and Subsection (b) of this Section 9.2,
except
that such Subparagraph and Subsection shall be
applied with respect to years of the Member's Period
of Service rather than years of participation in the
Plan. In no event shall the reductions set forth in
this
Subsection (c) reduce the limitations referred to in
Subsections (a) or (b) to an amount less than l/l0 of
such limitation (determined without regard to the
reductions in this Subsection (c)).
(d) If the Member's Annual Benefit
commences after the Social Security Retirement Age,
the dollar limitation contained in Section 9.2(a)(1)
shall be adjusted (in accordance with regulations
prescribed by the Secretary) based on the actuarial
assumptions specified in Section 1.2 for optional
forms of payment other than the lump sum option
(except that the interest rate assumption shall be 5%
if
the rate specified is greater than 5%) so that such
limitation equals an annual benefit, beginning at the
age at which the Member's benefit commences, which
is equivalent to a benefit equal to the dollar amount
specified under Section 9.2(a)(1) beginning at the
Social Security Retirement Age.
(e) In the case of an annual retirement
benefit that begins before a Member's Social Security
Retirement Age, the dollar limitation contained in
Subsection (a)(1) shall be adjusted (in accordance
with regulations prescribed by the Secretary) to the
actuarial equivalent, as of the date such benefits
commence, of a benefit equal to the amount specified
in Subsection (a)(1) commencing at the Social
Security Retirement Age on the basis of the actuarial
assumptions specified in Section 1.2 for optional
forms of payment other than the lump sum option
(except that the interest rate shall be 5% if the
rate
specified is less than 5%).
(f) The dollar limitations contained in
Subsection (a) shall be adjusted for increases in the
cost of living in accordance with regulations
prescribed by the Secretary of the Treasury under
Section 415(d) of the Code. Each annual adjustment
shall be limited to the scheduled annual increase, as
determined by the Secretary, and shall become
effective on January 1 of the year for which the
increase has been determined.
9.3 Notwithstanding the provisions of Section 9.2, for
each Member who is also a participant in any Defined
Contribution Plan, the Trustee will compute such
Member's Defined Benefit Plan Fraction and Defined
Contribution Plan Fraction and will adjust his Annual
Additions under the Defined Contribution Plans and
his Projected Annual Benefit under the Defined
Benefit Plans, so that the sum of such fractions, for
any Limitation Year, will not exceed (1.0).
Reductions in such Annual Additions and such
Projected Annual Benefit shall be made in the
following order:
(a) First, voluntary contributions
constituting Annual Additions under each Retirement
Plan shall be reduced proportionately to the
voluntary
contributions which the Member could otherwise have
made to such Retirement Plans;
(b) Second, the Member's Projected Annual
Benefit under this Plan shall be reduced by the
proportion that his Projected Annual Benefit under
each such Plan bears to his aggregate Projected
Annual Benefit under all such Plans;
(c) Third, Employer Contributions (other
than Salary Reduction Contributions) to profit
sharing
plans and stock bonus plans shall be reduced
proportionately to such Employer Contributions that
would otherwise be made to the Member's accounts
under such Plans; and
(d) Fourth, Salary Reduction Contributions
to Defined Contribution Plans shall be reduced
proportionately to the Salary Reduction Contributions
that would otherwise be made to the Member's
accounts under such Plans.
9.4 If, on a Member's Benefit Commencement
Date, his Accrued Benefit, computed without regard
to this Article IX, exceeds the maximum annual
benefit which he may receive under the provisions
hereof, his retirement benefit shall be adjusted on
the
first day of each subsequent Plan Year to take into
account any increase, since his Benefit
Commencement Date, in the maximum permissible
retirement benefit; provided, however, that such
retirement benefit shall not at any time exceed his
Accrued Benefit, computed without regard to this
Article IX, as of his Benefit Commencement Date.
9.5 The limitation imposed by this Article IX shall be
administered in accordance with the final regulations
and rulings issued by the Secretary of the Treasury
under Section 415 of the Code.
ART ICLE X
TOP -HEAVY PLAN YEARS
10.1 For purposes of this Article X:
(a) (1) "Key Employee" means any
Employee who, at any time during the Plan Year or
any of the four (4) preceding Plan Years, is --
(A) one of the ten (10)
Employees owning the largest interests in the
Company and all Affiliates considered as a unit;
(B) an owner of (i) more
than five percent (5%) of the outstanding stock, or
of
stock possessing more than five percent (5%) of the
total combined voting power, of the Company or any
Affiliate, or (ii) more than five percent (5%) of the
capital or profits interest in any Affiliate which is
not
a corporation;
(C) an owner of (i) more
than one percent (1%) of the outstanding stock or of
stock possessing more than one percent (1%) of the
total combined voting power of the Company or any
Affiliate or (ii) more than one percent (1%) of the
capital or profits interest in any Affiliate which is
not
a corporation, in either case if and only if the
Section
415 Compensation of such owner from the Company
and all Affiliates combined exceeds $150,000; or
(D) an officer of the
Company or an Affiliate whose Section 415
Compensation exceeds 50% of the dollar limitation in
effect under Section 415(b)(1)(A) for any such Plan
Year.
(2) For purposes of Subparagraph
(1)(A),
(A) no Employee shall be
considered a Key Employee if such Employee's
Section 415 Compensation is not more than the
amount determined under Section 415(c)(1)(A) of the
Code (as adjusted pursuant to Section 415(d)(1)(B) of
the Code) for the calendar year in which falls the
Determination Date; and
(B) if any two Employees own
the same interest in the Company or any Affiliate,
the
Employee having the larger Section 415
Compensation will be considered to own the larger
interest.
(3) For purposes of Subparagraphs
(1)(A)-(C), an Employee shall be considered as
owning all interests in the Company or an Affiliate
which he owns directly or would be considered as
owning under the rules contained in Section 318 of
the Code, except that subparagraph (C) of Section
318(a)(2) shall be applied by substituting "5%" for
"50%".
(4) No more than the greater of
three (3) Employees or ten percent (10%) of all
Employees (up to a maximum of fifty (50)) of the
Company and all Affiliates combined shall be
considered officers for purposes of Subparagraph
(1)(D) and, with respect to Plan Years beginning on
or before February 28, 1985 no Employee of the
Company or an Affiliate which is not a corporation
shall be considered an officer for such purposes.
Where the actual number of such officers exceeds the
limits imposed by the preceding sentence, those
Employees who will be considered officers for
purposes of Subparagraph (1)(D) shall be the officers
having the highest annual compensation during the
five (5) year period consisting of the Plan Year and
the four (4) preceding Plan Years.
(b) "Determination Date" means with
respect to any Plan Year, the last day of the
immediately preceding Plan Year.
(c) "Aggregation Group" means
(1) each plan of the Company or an
Affiliate, which --
(A) has one or more
participants who are Key Employees, or
(B) enables any plan
described in Subparagraph (A) to meet the
requirements of Section 401(a)(4) or Section 410 of
the Code.
plus, at the Company's election,
(2) any other plan or plans which,
when considered together with the plan or plans
described in Paragraph (1), satisfy the requirements
of
Section 401(a)(4) and/or Section 410 of the Code.
(d) "Employee" and "Key Employee"
include their beneficiaries.
(e) "Top-Heavy Plan Year" means any
Plan Year with respect to which the Plan is a Top-
Heavy Plan described in Section 10.3, such Section
10.3 to be read as incorporating the definitions
supplied by Section 416 of the Code and the
regulations promulgated thereunder, and those of any
successor statute thereto.
(f) "Section 415 Compensation" has the
meaning assigned to it in Section 9.1(i) of the Plan,
but determined without regard to Sections 125,
402(a)(8) and 402(b)(1)(B) of the Code.
10.2 To the extent required under Section 401(a)(10)(B)
and/or Section 416 of the Code (or any successor
statute(s) thereto), for any Top-Heavy Plan Year, the
provisions of the Plan shall apply only to the extent
not inconsistent with Sections 10.4 through 10.7 of
the Plan.
10.3 (a) The Plan is a Top-Heavy Plan with
respect to a Plan Year, if, as of the Determination
Date of such Plan Year --
(1) the cumulative accrued benefits
of Key Employees under the Plan exceeds sixty
percent (60%) of the cumulative accrued benefits of
all Employees under the Plan unless the Plan is a
Member of an Aggregation Group with respect to
which the percentage test described in Subparagraph
(2)(B) is not met; or
(2) the Plan is a Member of an
Aggregation Group --
(A) which is described in
Section 10.1(c)(1),and
(B) with respect to which
the sum of --
(i) the present value
of the cumulative accrued benefits of all Key
Employees under all defined benefit plans within the
Aggregation Group, and
(ii) the aggregate of
the account balances of all Key Employees under all
defined contribution plans in the Aggregation Group -
-
exceeds sixty percent (60%) of the sum of --
(i) the present value
of the cumulative accrued benefits of all Employees
under all defined benefit plans included in the
Aggregation Group, and
(ii) the aggregate of
the account balances of all Employees under all
defined contribution plans in the Aggregation Group.
(b) For purposes of this Section 10.3:
(1) the accrued benefit and/or account
balances of any Employee who is not a Key
Employee during the Plan Year but who was a Key
Employee during any prior Plan Year shall be
disregarded;
(2) the present value of an Employee's
accrued benefit under a defined benefit plan as of a
Determination Date shall be determined as of that
valuation date which occurs within twelve (12) month
period ending on such Determination Date and is used
by the enrolled actuary for computing Plan costs for
minimum funding, as if the Employee's separation
from service occurred on such valuation date.
(3) the account balance of an
Employee in a defined contribution plan as of any
Determination Date shall be equal to the account
balance of the Employee on the valuation date which
occurs within the twelve (12) month period ending on
such Determination Date including an adjustment for
contributions made or which are due as of such
Determination Date.
(4) for any Plan Year beginning after
1984, the present value of the accrued benefit or the
account balance of any Employee who has not
performed services for the Company during the five
(5) year period ending on the Determination Date
shall be disregarded.
(5) the account balance of an
Employee in a defined contribution plan or the
present value of the accrued benefit of an Employee
in a defined benefit plan, as of a Determination Date
-
(A) excludes any rollover
contribution or similar transfer to such plan made
after December 31, 1983 and attributable to the
Participant's interest in a plan other than a plan
maintained by the Company or an Affiliate, and
(B) includes any amount
distributed with respect to the Employee under the
plan within the five (5) year period ending on the
Determination Date, except to the extent that such
amount is included in such Employee's account
balance or the present value of his accrued benefit
pursuant to Paragraph (2) or (3). This Subparagraph
(B) shall also apply to distributions under a
terminated plan which if it had not been terminated
would have been required to be included in an
Aggregation Group, and
(6) the present value of Employees'
accrued benefits shall be determined using the
actuarial assumptions specified in Section 1.2.
10.4 (a) The Accrued Benefit, commencing on
or after the Normal Retirement Date of each
individual, other than a Key Employee, who was a
Member during any Top-Heavy Plan Year shall be the
greater of:
(1) such Member's Accrued Benefit
determined under Article V, or
(2) an amount equal to two percent
(2%) of such Member's Highest Average
Compensation for each of the first ten (10) years of
his Top-Heavy Service, adjusted pursuant to
Subsection(c); provided, however, that in the case of
a
Member whose Benefit Commencement Date is later
than his Normal Retirement Date, the amount
determined under this Paragraph (2) commencing on
such Benefit Commencement Date shall not be less
than the Actuarial Equivalent of the Accrued Benefit
that would have been payable pursuant to this
Paragraph (2) on the Member's Normal Retirement
Date.
(b) For purposes of this Section 10.4:
(1) "Highest Average Compensation"
means a Member's average Section 415 Compensation
for the five (5) consecutive years during which his
aggregate Section 415 Compensation was highest,
excluding compensation earned by such Member --
(A) after the close of the
last Top-Heavy Plan Year, or
(B) prior to December 1,
1984, except to the extent that compensation prior to
Decmeber 1, 1984 is required to be taken into account
so that such average is based on a five (5) year
period.
(2) "Top-Heavy Service" means the
Member's Period of Service, excluding any Service --
(A) during a Plan Year
which was not a Top-Heavy Plan Year, or
(B) prior to December 1,
1984.
(c) In the case of a Member who is also a
participant in a defined contribution plan maintained
by the Company or an Affiliate, the amount described
in Paragraph (a)(2) shall be reduced by the actuarial
equivalent, determined as of the date of the Member's
Benefit Commencement Date, of the Member's
account balance under such defined contribution plan
derived from employer contributions (which account
balance shall be deemed to include prior withdrawals
made by the Member accumulated at interest to the
Member's Benefit Commencement Date). For
purposes of this Subsection (c), actuarial
equivalence
and the interest rate referred to in the preceding
sentence shall be determined using the actuarial
assumptions described in Section 1.2.
10.5 The Accrued Benefit of any individual, other than a
Key Employee, who was a Member during any Top-
Heavy Plan Year shall be the greater of:
(a) his Accrued Benefit determined in
accordance with Article V; or
(b) his Accrued Benefit computed in
accordance with Section 10.4(a)(2).
10.6 (a) For any Top-Heavy Plan Year, each
Member shall be vested in his Accrued Benefit in
accordance with the following schedule:
Nonforfeitable
Years of Service
Percentage
Fewer than Two years 0%
Two years but less than Three Years
20%
Three years but less than Four years
40%
Four years but less than Five years
60%
Five or more years
100%
(b) Any portion of a Member's Accrued
Benefit which has become vested pursuant to
Subsection (a) shall remain vested after the Plan has
ceased to be a Top-Heavy Plan.
(c) Any Member who has completed a
Period of Service of at least three years prior to
the
beginning of the Plan Year in which the Plan ceased
to be a Top-Heavy Plan shall continue to vest in his
Accrued Benefit according to the schedule set forth
in
Subsection (a) after the Plan has ceased to be a Top-
Heavy Plan.
10.7 For any Top-Heavy Plan Year, the limitations
contained in Article IX of the Plan shall be applied by
substituting "1.0" for "1.25" in Section 9.1(c)(2) and
9.1(f)(2) of the Plan, and the transitional rule under
Section 415(e)(6) of the Code, the use of which is
provided for by Section 9.1(f)(3) of the Plan shall be
applied by substituting $41,500 for $51,875, unless
for such Plan Year --
(a) the requirements of Section 10.4 would be
satisfied if "three percent (3%)" were substituted
for
"two percent (2%)" in Subsection (a)(1) thereof; and
(b) the Plan would not be a Plan described in
Section 10.3 if "ninety percent (90%)" were
substituted for "sixty percent (60%)" wherever the
latter figure appears in Section 10.3.
ARTICLE XI
ADMINISTRATION; CLAIMS PROCEDURE
11.1 Salant Corporation by its approval of the Plan, as
amended, accepts responsibility as a named fiduciary
of the Plan with respect to the selection and retention
of the Trustee of the Fund, the selection and retention
of any Investment Manager, the selection of the
members of the Committee and for reviewing the
performance of such Committee as to the fiduciary
duties and responsibilities vested in it under the Plan
as hereinafter set forth. Salant Corporation shall act
by resolution of its Board of Directors. Such action
shall be evidenced by written resolution certified in
writing by the Secretary or any Assistant Secretary of
Salant Corporation.
11.2 The Committee shall consist of not fewer than
3 nor more than 5 members and may, but need not,
include members of the Board of Directors of Salant
Corporation. Any member may resign at will by
notice to Salant Corporation or be removed (with or
without cause) by Salant Corporation. The
Committee shall have exclusive responsibility and
authority for approving and reviewing the Plan's
investment and funding objectives and policies; and
for reviewing and evaluating the performance and
policies of the Trustee and of any Investment
Manager. The Committee shall report regularly, at
least annually, to the Board of Directors of Salant
Corporation with respect to its evaluation of same.
The Committee shall also have primary responsibility
and authority for the administration of the Plan,
including the authority to interpret its provisions,
to
authorize distributions from Plan assets, to
establish
and enforce such rules and regulations as it shall
deem proper for the administration of the Plan, to
determine the amount of benefits which shall be
payable to any person in accordance with the
provisions the Plan, to establish benefit claim
procedures, to consider and decide conclusively
appeals by any claimant in accordance with an
appeals procedure established by the Committee and
to authorize the payment of benefits from Plan
assets.
The decisions of the Committee in the interpretation
of the provisions of the Plan and the determination
of
questions regarding eligibility for and the amount of
benefits payable in accordance with the provisions of
the Plan shall be conclusive and binding upon all
parties. The Committee shall also have the
responsibility for compiling and communicating to the
Investment Manager, if any, the financial information
and projections with respect to anticipated
contributions to and distributions from the Plan so
that the current and ongoing liquidity and other
financial needs of the Plan may be properly
integrated
into the recommendations of the Investment Manager
respecting the Plan's investment objectives. The
Committee shall have the authority to engage
independent actuaries, counsel and consultants in
order to fulfill its responsibilities, to rely on the
advice of same and to compensate same out of Plan
assets. The Committee shall also have the
responsibility with respect to reporting and
disclosure
requirements under the Employee Retirement Income
Security Act of 1974. The Committee shall also,
from time to time, recommend Plan amendments to
the Board of Directors of Salant Corporation as the
Committee in consultation with others may deem
appropriate. In addition to and in furtherance of
the
powers and authorities herein conveyed, the
Committee shall be authorized, in its discretion, to
allocate responsibilities among one or more of its
members, and to delegate responsibilities to any
person or persons selected by it. Any action taken
by
the Committee shall be taken by a majority of its
members at a meeting or by written instrument
approved by such majority in the absence of a
meeting. A written resolution or memorandum signed
by at least two members or by one member and the
secretary of the Committee shall be sufficient
evidence to any person of any action taken by such
Committee.
11.3 Salant Corporation shall have the power to appoint
one or more Investment Managers of the Fund. Any
Investment Manager appointed by Salant Corporation
shall have responsibility for recommending investment
objectives and policies to the Committee and for
implementing same. The Investment Manager shall
be responsible for investment decisions involving
assets of the Fund over which the Investment
Manager has authority and shall make regular reports
to the Committee.
11.4 Any person, corporation or other entity may serve in
more than one fiduciary capacity under the Plan.
11.5 In the event of a dispute between the Trustees
or Committee and a Member or beneficiary over the
amount of benefits payable under the Plan, the
Member or beneficiary may file a claim for benefits
by notifying the Committee of such claim. Such
notification may be in any form adequate to give
reasonable notice to the Committee, shall set forth
the
basis of such claim and shall authorize the Committee
to conduct such examinations as may be necessary to
determine the validity of the claim and to take such
steps as may be necessary to facilitate the payment
of
any benefits to which the claimant may be entitled
under the Plan.
11.6 The Committee shall decide whether to grant a claim
within ninety (90) days of the date on which the
claim is filed, unless special circumstances require a
longer period for adjudication and the claimant is
notified in writing of the reasons for an extension of
time within such ninety (90) day period; provided,
however, that no extension shall be permitted beyond
ninety (90) days after the date on which the claimant
received notice of the extension of time from the
Committee. If the Committee fails to notify the
claimant of their decision to grant or deny the claim,
such claim shall be deemed to have been denied by
the Committee and the review procedure described in
Subsection (3) shall become available to the claimant.
11.7 (a) Whenever a claim for benefits is
denied, written notice, prepared in a manner
calculated to be understood by the claimant, shall be
provided to the claimant, setting forth the specific
reasons for the denial and explaining the procedure
for review of the decision made by the Committee. If
the denial is based upon submission of information
insufficient to support a decision, the Committee shall
specify the information which is necessary to perfect
the claim and its reasons for requiring such additional
information.
(b) Any claimant whose claim is denied,
may, within sixty (60) days after the receipt of
written
notice of such denial, request in writing a review by
the Board, the Members of which shall be "named
fiduciaries," within the meaning of Section 402(a) of
ERISA for the purpose of adjudicating such appeals.
Such claimant or the claimant's representative may
examine any Plan documents relevant to the claim
and may submit the issues and comments in writing.
The Board shall adjudicate the claimant's appeal
within sixty (60) days after its receipt of the
claimant's written request for review, unless special
circumstances require a longer period for
adjudication
and the claimant is notified in writing of the
reasons
for an extension of time within such sixty (60) day
period; provided, however, that such adjudication
shall be made no later than one hundred twenty (120)
days after the Board's receipt by them of the
claimant's written request for review.
(c) If the Board fails to notify the claimant
of its decision with respect to the claimant's
request
for review within the time specified by this
Subsection (3), such claim shall be deemed to have
been denied on review.
11.8 If the claim is denied by the Board, such decision
shall be in writing, shall state specifically the reasons
for the decision, shall be written in a manner
calculated to be understood by the claimant and shall
make specific reference to the pertinent Plan
provisions upon which it is based.
11.9 The procedure set forth in this Article XI shall be
revised as necessary to conform to regulations
promulgated by the United States Department of
Labor or any successor authority regulating claims
procedures for employee benefit plans.
ARTI CLE XII
THE TRUST FUND
12.1 The Company shall enter into a Trust Agreement with
the Trustee, for the establishment and maintenance of
the Trust Fund. The Trust Agreement shall be
deemed to form a part of the Plan, and all rights
which may accrue to any person under the Plan shall
be subject to the terms of the Trust Agreement.
12.2 The Trustee shall manage and control the Trust Fund
in accordance with the terms of the Trust Agreement.
The Trustees shall pay benefits to Members or former
Members only upon the specific instructions of the
Committee.
12.3 Administrative expenses of the Plan shall be paid out
of the Trust Fund unless and to the extent paid by the
Company. The Company may reimburse the Trust
Fund for any payment so made.
ARTI CLE XIII
AMEN DMENT AND TERMINATION OF THE PLAN
13.1 Amendment of the Plan
The Company reserves the right to modify or amend
this Plan from time to time and to any extent that it
may deem advisable, including without limitation any
amendment deemed necessary to insure the continued
qualification of this Plan under the provisions of
the
Internal Revenue Code. Any amendment shall be
made pursuant to a resolution duly adopted by the
Company's Board of Directors. No amendment shall
have the effect of returning to the Company the whole
or any part of the assets of this Plan or of
diverting
any part of the assets of this Plan to purposes other
than for the exclusive benefit of the Members and
their beneficiaries at any time prior to the
satisfaction
of all the liabilities under this Plan with respect
to
such persons. If such amendment reduces the
Accrued Benefit of any Member, such amendment
shall not be valid unless approved by the Secretary
of
Labor or unless he fails to take action disapproving
such amendment within 90 days after receiving notice
of it.
Except as otherwise provided in regulations
prescribed
by the Secretary of the Treasury, an amendment to the
Plan which has the effect of eliminating or reducing
an early retirement benefit or eliminating an
optional
form of benefit with respect to benefits attributable
to
service prior to such amendment shall be treated as
reducing Accrued Benefits for purposes of this
Section 13.1.
A Plan amendment that changes the Plan's vesting
schedule shall not be effective with respect to any
Member with a three-year Period of Vesting Service
who makes an irrevocable election during the election
period to have his benefit determined without regard
to such amendment.
For purposes of the preceding paragraph the election
period shall begin on the date the Plan amendment is
adopted and end on the latest of the following dates:
(i) The date which is 60 days after the
day the Plan amendment is adopted,
(ii) The date which is 60 days after the
day the Plan amendment is effective, or
(iii) The date which is 60 days after
the day the Member is issued written
notice of the Plan amendment by the
Plan Administrator.
13.2 Termination of the Plan
(a) Termination. The Company reserves
the right to terminate the Plan, in whole or in
part, at any time.
(b) Benefits are Non-Forfeitable. Upon
termination or partial termination of the Plan,
the rights of all affected Members to their
Accrued Benefits in accordance with Section
5.1 to the date of termination or date of partial
termination shall be non-forfeitable, except as
provided under the provisions of Article XIV.
13.3 Allocation of Assets Upon Plan Termination
Upon termination of the Plan in accordance with the
provisions of Section 13.2, the Plan's assets shall
be
allocated in accordance with the following order,
subject to the provisions of Title IV of ERISA:
(a) Benefits payable as an annuity to
(i) Members and their beneficiaries who began
receiving benefits at least three years prior to
the termination date of the Plan and (ii)
Members and their beneficiaries who could
have been receiving benefits as of three years
prior to the termination date of the Plan if they
had retired prior to the beginning of the three
year period and if their benefits had
commenced (on the Life Annuity form under
this Plan) as of the beginning of such period,
based on the provisions of the Plan (as in
effect during the five year period ending on
such termination date) under which such
benefit would be the least.
Salant Corporation may at any time require any
Affiliate to withdraw from the Plan, and any
Affiliate may voluntarily withdraw with Salant
Corporation's consent, and upon any such
withdrawal, the Plan, in respect of such
Affiliate, shall be terminated.
Upon a termination of the Plan with respect to an
Affiliate, the Trustees shall allocate and
segregate for the benefit of the Members then
or theretofore employed by such Affiliate their
proportionate interest in the Trust Fund.
(b) All other benefits which are insured by
the Pension Benefit Guaranty Corporation
determined without regard to Section
4022(b)(5) of ERISA or which would have
been so insured if Section 4022(b)(6) of
ERISA did not apply.
(c) All other non-forfeitable benefits under
the Plan.
(d) All other benefits under the Plan.
If the assets of the Plan available for allocation under
(a) or (b) are insufficient to satisfy in full the
benefits which are described, the assets shall
be allocated pro rata among such individuals
on the basis of the present value (as of the
Plan's date of termination) of their respective
benefits.
Any residual assets of the Plan remaining after the
satisfaction of all liabilities of the Plan shall be
distributed to the Company.
13.4 Merger or Consolidation
No merger or consolidation with, or transfer of
assets
or liabilities to, any other plan shall be made
unless
each Member in this Plan would receive a benefit, if
the Plan terminated immediately after the merger,
consolidation or transfer, equal to or greater than
the
benefit he would have been entitled to receive
immediately before the merger, consolidation or
transfer if this Plan had then terminated.
ARTI CLE XIV
LIMITATION OF BENEFITS FOR HIGHLY PAID EMPLOYEES
14.1 In the event of Plan termination, the benefit payable
to any highly compensated employee or any highly
compensated former employee (as defined in
section 414(q) of the Code and regulations
thereunder) shall be limited to a benefit that is
nondiscriminatory under section 401(a)(4) of the
Code. If payment of benefits is restricted in
accordance with this Section 14.1, assets in excess of
the amount required to provide such restricted benefits
shall become a part of the assets available under
Section 13.3 for allocation among Members and their
contingent annuitants and beneficiaries whose benefits
are not restricted under this Section 14.1.
14.2 The restrictions of this Section 14.2 shall apply prior
to termination of the Plan to any Member who is a
highly compensated employee or a highly
compensated former employee and who is one of the
25 highest paid employees of the Company and its
Affiliates for any Plan Year. The annual payments to
any such Member shall be limited to an amount equal
to the payments that would have been made to the
Member under a single life annuity that is the
Actuarial Equivalent of the sum of the Member's
Accrued Benefit and any other benefits under the
Plan.
14.3 The restrictions in Section 14.2 shall not apply:
(a) if, after the payment of all benefits
payable to such Member, the value of the Plan
assets equals or exceeds 110 percent of the
value of the current liabilities (within the
meaning of section 412(1)(7) of the Code);
(b) if the value of all benefits payable to such
Member is less than one percent (1%) of the
value of current liabilities; or
(c) if the value of all benefits payable to such
Member does not exceed $3,500 (or such other
amount as is specified in section 411(a)(11) of
the Code.
ARTICLE X V
MISCELLAN EOUS PROVISIONS
15.1 Evidence of Survival
Where a benefit payment is contingent upon the
survival of any person, evidence of such person's
survival must be furnished either by personal
endorsement of the check drawn for such payment or
by other evidence satisfactory to the Plan
Administrator.
15.2 Non-Alienation of Benefits
Except in the case of a qualified domestic relations
order within the meaning of Section 414(p) of the
Code, benefit payments may not be assigned or
hypothecated and, to the extent permitted by law, no
such payment will be subject to legal process or
attachment for the payment of any claims against any
person entitled to receive the same. No portion of
any benefit payable under the Plan shall be alienated
except for those amounts designated by the Member,
provided (a) such amounts do not exceed 10% of any
benefit payment and (b) any such designation made
by a Member may be revoked by him at any time.
15.3 Payments to Incompetents
If the Company receives evidence satisfactory to it
that (a) a payee entitled to receive any payment
under
the Plan is physically or mentally incompetent to
receive such payment or is a minor, (b) another
person or an institution is then maintaining or has
custody of such payee and (c) no guardian, committee
or other representative of the estate of such payee
has
been appointed, the Plan Administrator may direct
that payments be made (in the case of a minor at a
rate not exceeding $50 a month) to such other person
or institution.
15.4 Misstated Information
If any information has been misstated on which a
benefit under the Plan with respect to a person was
based, such benefit shall not be invalidated but the
amount of the benefit shall be adjusted to the proper
amount as determined on the basis of the correct
information. Overpayments, if any, with interest as
determined by the Plan Administrator shall be charged
against any payments accruing with respect to the
person. The Plan Administrator reserves the right to
require proof of age of any person entitled to a
benefit under this Plan.
15.5 Beneficiary
Subject to Section 7.2, a Member shall designate,
with the right to change such designation, a
beneficiary to receive any payment or payments to
which a beneficiary may become entitled under the
Plan. Any other person to whom periodic payments
are payable under this Plan may designate, with the
right to change such designation, a beneficiary to
receive any remaining periodic payments becoming
due upon the death of such person provided that no
prior conflicting designation by a Member is then in
effect with respect thereto. If no designated
beneficiary is surviving when a payment is to be
made to a beneficiary, the commuted value of any
remaining periodic payments shall be made to the
person or persons in the first surviving class of the
following classes of successive preference
beneficiaries: (a) the Member's widow or widower,
(b) the Member's surviving children, (c) the Member's
surviving parents, (d) the Members surviving brothers
and sisters, (e) the executors or administrators of
the
person upon whose death the payments become due.
15.6 The law of the State of New York shall be the
controlling state law in all matters relating to the Plan
and shall apply to the extent it is not preempted by
the laws of the United States of America.
IN WITNESS WHEREOF, the Company, by
its duly authorized officers, with its corporate seal
affixed, has caused this Plan to be executed this
day of December 1994.
SALANT CORPORATION
By
Attest:
6960
03/23/95
APPENDIX A
ADOPTING COMPANIES
Name Effective Date
Salant Corporation January 1, 1979
Denton Mills, Inc. January 1, 1992