SALANT CORPORATION RETIREMENT PLAN
AS RESTATED
DECEMBER 1, 1989
TABLE OF CONTENTS
ARTICLE PAGE
PREAMBLE 1
I DEFINITIONS 2
II SERVICE 9
III MEMBERSHIP 12
IV ELIGIBILITY FOR PLAN BENEFITS 13
V BENEFIT ACCRUAL 14
VI AMOUNT OF BENEFIT 16
VII MANNER AND FORM OF PAYMENT 20
VIII CONTRIBUTIONS AND FUNDING 27
IX LIMITATIONS ON BENEFITS AND CONTRIBUTIONS
28
X TOP-HEAVY PLAN YEARS 34
XI ADMINISTRATION; CLAIMS PROCEDURE 40
XII THE TRUST FUND 43
XIII AMENDMENT AND TERMINATION OF THE PLAN 44
XIV LIMITATION OF BENEFITS FOR HIGHLY PAID
EMPLOYEES 47
XV MISCELLANEOUS PROVISIONS 48
APPENDIX A 50
PREAMBLE
Salant Corporation hereby amends the Salant Corporation
Retirement Plan (the "Plan") and the Manhattan Industries Inc. Employees'
Benefit Plan (the "Manhattan 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, the Unemployment Compensation Amendments of 1992 and the
Revenue Reconciliation Act of 1993 (the "Acts") effective as of December
1, 1989 with respect to the Plan and February 1, 1989 with respect to the
Manhattan Plan, or with respect to certain provisions as of the pertinent
effective dates contained in the provisions of the Acts, merges the
Manhattan Plan into the Plan effective as of March 1, 1992 and restates the
Plan as follows:
ARTICLE I
DEFINITIONS
The following words and phrases when us4p13ed 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 4.6 or 4.7 in the
form of a single life annuity commencing on the date specified
in Section 7.8 or 7.9 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.
In determining the Actuarial Equivalent of the minimum
Accrued Benefit under Section 5.2 of a Member who was a
participant in the Manhattan Plan, the actuarial equivalent
factors set forth in the Manhattan Plan prior to this restatement
shall be used.
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 "Average Final Compensation" means an Employee's average
annual Compensation received during the five consecutive
calendar years (disregarding calendar years in which the
Employee was not employed during the entire calendar year,
unless including the Compensation for such a calendar year
results in a greater Average Final Compensation) in the last
fifteen years of his Service affording the highest such average
Compensation. In the case of an Employee with fewer than
five complete consecutive calendar years of Compensation,
Final Average Compensation will be the Employee's average
monthly compensation for those months in his Period of
Service during which he was paid for the complete month
multiplied by twelve.
1.5 "Benefit Commencement Date" means the date on which a
Member's benefit payments commence under the Plan.
1.6 "Board of Directors" means the Board of Directors of Salant
Corporation.
1.7 "Code" means the Internal Revenue Code of 1986, as
amended.
1.8 "Committee" means the person or persons appointed by the
Board to administer the Plan.
1.9 "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.
1.10 "Compensation" means the total wages within the meaning of
Section 3401(a) of the Code and all other payments of
compensation paid by the Company to an employee for which
the Company is required to furnish the employee a written
statement under Sections 6041(d), 6051(a)(3) and 6052 of the
Code with respect to any period of Service together with any
salary deferral contributions made under the Company's
Savings and Investment Plan or any other employee plan
qualified under Section 401(k) or Section 125 of the Code, but
excluding all of the following items (even if includible in
gross income): reimbursements or other expense allowances,
fringe benefits (cash and non-cash), moving expenses, deferred
compensation and welfare benefits, severance payments to
former Employees, income from the exercise of stock options,
and any amount in excess of the amount specified in Section
401(a)(17) of the Code (as amended by the Revenue
Reconciliation Act of 1993 and as adjusted for increases in the
cost of living by the Secretary of the Treasury pursuant to
Section 401(a)(17)(B) of the Code). "Compensation" earned
prior to December 1, 1989 (February 1, 1989 in the case of a
Member who participated in the Manhattan Plan) shall be,
determined based upon the terms of the Plan (or the Manhattan
Plan, if applicable) as in effect prior to such date.
Compensation earned prior to January 1, 1992 by Denton
Mills and West Dallas Employees, and Compensation earned
by an individual while he is not classified as an Employee,
shall be disregarded.
1.11 "Covered Compensation" means, with respect to a Member,
the average (without indexing) of the Social Security Limits in
effect for each calendar year during the 35-year period ending
with the last day of the calendar year in which the Member
attains, or will attain, Social Security Retirement Age. In
determining a Member's Covered Compensation for a Plan
Year, the Social Security Limit for such Plan Year and any
subsequent Plan Year shall be assumed to be the same as the
Social Security Limit in effect as of the beginning of such
Plan Year. A Member's Covered Compensation for a Plan
Year commencing after the 35-year period described above is
his Covered Compensation for the Plan Year during which the
35-year period ends. A Member's Covered Compensation for
a Plan Year prior to the 35-year period described above is the
Social Security Limit as of the beginning of such Plan Year.
1.12 "Deferred Retirement" means a Member's retirement after his
Normal Retirement Date.
1.13 "Deferred Retirement Date" means the first day of the month
coincident with or next following a Member's Deferred
Retirement.
1.14 "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, (b) with respect to a Member 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, or (c) with
respect to a Member who was a participant in the Manhattan
Plan whose Severance from Service Date is prior to January 1,
1994, the date a Member has both (1) attained his 55th
birthday and (2) completed a 20-year period of Vesting
Service, if such date is earlier than the date determined in (b)
above.
1.15 "Early Retirement Date" means 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.
1.16 "Effective Date" means June 3, 1973.
1.17 "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.
1.18 "Employee" means any person, including officers, employed
by the Company who is classified by the Committee under
uniform rules as a regular salaried, office, sales, security,
supervisory or technical employee, provided that no such
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.
1.19 "Employment Commencement Date" means the date on which
an Employee first performs an Hour of Service for the
Company.
1.20 "ERISA" means the Employee Retirement Income Security
Act of 1974, as amended.
1.21 "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 1.21.
1.22 "Manhattan Plan" means the Manhattan Industries, Inc.
Employees' Benefit Plan as it existed prior to March 1, 1992,
the date of its merger into the Plan.
1.23 "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.
1.24 "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,
provided, however, that in the case of a Member who was a
participant in the Manhattan Plan and who attained age 65
prior to January 1, 1992, "Normal Retirement Age" means the
date such Member attains his 65th birthday.
1.25 "Normal Retirement Date" means the first day of the month
coinciding with or next following a Member's Normal
Retirement Age.
1.26 "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.
The Period of Service of a Member who had been a
participant in the Manhattan Plan shall be the greater of (a) the
sum of (1) his "Service" as determined under the terms of the
Manhattan Plan through January 31, 1991 and (2) his Period of
Service commencing on February 1, 1991 or (b) the sum of (1)
his "Service" as determined under the terms of the Manhattan
Plan through January 31, 1992 and (2) his Period of Service
commencing on February 1, 1992.
1.27 "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.
1.28 "Plan" means the provisions of the Salant Corporation
Retirement Plan as restated and set forth herein; and prior to
March 1, 1992 also means the provisions of the Manhattan
Industries, Inc. Employees' Benefit Plan as restated and set
forth herein.
1.29 "Plan Administrator" means Salant Corporation.
1.30 "Plan Year" means for periods prior to December 1, 1991,
each twelve month period beginning on December 1 and
ending on November 30; the month of December 1991; and
each calendar year thereafter. With respect to the Manhattan
Plan prior to the Merger, "Plan Year" means for periods prior
to February 1, 1991, each twelve month period beginning on
February 1 and ending on January 31; the eleven month period
beginning on February 1, 1991 and ending on December 31,
1991; and each calendar year thereafter.
1.31 "Profit Sharing Plan Company Amount" means any amount
transferred to the Trust Fund attributable to the Company's
contributions made under the Salaried Employees' Profit
Sharing Savings Plan of Salant Corporation on behalf of the
Member, together with interest compounded annually at the
rate of 6% a year from the date of transfer.
1.32 "Profit Sharing Plan Member Amount" means any amount
transferred to the Trust Fund attributable to a Member's
contributions made under the Salaried Employees' Profit
Sharing Savings Plan of Salant Corporation, together with
interest compounded annually at the rate of 6% a year from
the date of transfer.
1.33 "Reemployment Commencement Date" means the first day
following a Period of Severance on which an Employee
performs an Hour of Service for the Company.
1.34 "Retirement Date" means the Member's Early Retirement Date,
Normal Retirement Date or Deferred Retirement Date, as the
case may be.
1.35 "Service" means an Employee's period of employment with the
Company credited in accordance with Article II. For Members
who participated in the Manhattan Plan, Service for periods
prior to February 1, 1989 shall be determined based on the
terms of the Manhattan Plan as in effect prior to such date.
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 1.19, 1.21, 1.27, 1.33 and 1.36; 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.
1.36 "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.
1.37 "Social Security Limit" means, with respect to any calendar
year, the contribution and benefit base determined under
section 230 of the Social Security Act for such calendar year.
1.38 "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.
1.39 "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 or the Spouse's Benefit pursuant
to Section 6.6, 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.
1.40 "Thomson Company Plan Company Amount" means an
amount equal to the value of the Member's Benefit Units
attributable to the Thomson Company contributions under the
Retirement Plan of Thomson Company on behalf of the
Member as of October 1, 1973 multiplied by a factor of 1.098,
together with interest compounded annually at the rate of 6% a
year from such date.
1.41 "Thomson Company Plan Member Amount" means any
amount transferred to the Trust Fund attributable to a
Member's contributions made under the Retirement Plan of the
Thomson Company, together with interest compounded
annually at the rate of 6% a year from October 2, 1973.
1.42 "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.
1.43 "Trust Agreement" means the agreement entered into between
Salant Corporation and the Trustee pursuant to which the
Trustee holds the Trust Fund.
1.44 "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.
ARTIC LE II
SERVI CE
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 1.18, each Period of Service with an
Affiliate and each Period of Severance taken into account
under Section 2.4(b).
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), (b) any Period of Service
by an individual while he is not classified as an Employee and
(c) in the case of an Employee employed at the West Dallas or
Denton Mills divisions of the Company, any Period of Service
prior to January 1, 1992.
To the extent that such period would count as Benefit Accrual
Service if the employer were the Company, Benefit Accrual
Service shall also include any period 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,
provided that the amount of retirement benefit payable to the
Member or his beneficiary under this Plan attributable to any
such period of employment shall be reduced (but not to less
than zero) by the amount of any pension or other benefit
derived from employer contributions attributable to such
periods of employment that is payable to the Member or to his
beneficiary under any other plan or arrangement to provide
retirement benefits that is maintained in whole or in part at the
expense of such employer. For purposes of computing such
reduction, the amount payable under any such plan or
arrangement to provide retirement benefits shall be valued by
the Committee to determine the appropriate actuarially
equivalent value using the factors specified for such purpose
under this Plan.
Notwithstanding the above, to determine a Member's period of
Benefit Accrual Service prior to January 1, 1979, 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 as an employee of the Company not included in the
definition of Employee under Section 1.18, each Period of
Service with an Affiliated Company and each Period of
Severance taken into account under Section 2.4(b).
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, 1979, 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.
The Vesting Service of a Member who had been a participant
in the Manhattan Plan shall be the sum of his "Vesting
Service" as determined under the terms of the Manhattan Plan
through December 31, 1991 plus his Period of Service
commencing on January 1, 1992. Furthermore, if such a
Member is credited with at
least 1,000 Hours of Service for the period from February 1,
1991 through January 31, 1992 and is credited with a Period
of Service of one year for the period for January 1, 1992
through December 31, 1992 shall be credited with two whole
years of Vesting Service for the period from February 1, 1991
through December 31, 1992.
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 1.18 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 (1) the later of the date on which he attains his 21st
birthday or is credited with a one-year Period of Eligibility
Service, or (2) the date he is credited with a two-year Period
of Eligibility Service, and (ii) an Employee hired before
December 1, 1988 (February 1, 1988 in the case of an
Employee who was an employee of Manhattan Industries, Inc.)
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 (or February 1, 1988, as the
case may be) 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 Disability Benefit
A Member shall be eligible for a Disability Benefit if, prior to
January 1, 1995, he (a) has at least 15 years of Service and (b)
becomes totally and permanently disabled while in the service
of the Company so that he is eligible for, and receiving, Social
Security disability benefits.
4.6 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.
4.7 Death Benefit
A Member who is not survived by an Eligible Spouse or
whose Eligible Spouse is not eligible for immediate
distribution of the Spouse's Benefit shall be eligible to have a
Death Benefit provided for his designated beneficiary if he
dies while an active Employee or after having attained Early
Retirement Age 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 45, and if the sum of his
age and Period of Vesting Service is not less than 65.
ART ICLE V
BEN EFIT ACCRUAL
5.1 Accrued Benefit
Each Member shall accrue a monthly benefit equal to 1/12 of
the sum of (a) and (b) reduced by (c), if applicable
(a) the greatest of (i), (ii), (iii) and (iv):
(i) (A) 0.65% of his Average Final
Compensation not in excess of 140% of his
Covered Compensation plus 1.25% of his
Average Final Compensation in excess of 140%
of his Covered Compensation, if any, multiplied
by (B) his Period of Benefit Accrual Service
(not in excess of 35 years); or
(ii) $96 multiplied by his Period of
Benefit Accrual Service after November 30,
1988 and $60 multiplied by his Period of
Benefit Accrual Service before December 1,
1988; provided, however, that no more than 30
years of Benefit Accrual Service shall be taken
into account, and for this purpose, those years
of a Member's Benefit Accrual Service shall be
applied that produce the greatest Accrued
Benefit; or
(iii) the sum of (A) and (B):
(A) the greater of an amount determined
under Subsection (a)(i) or (a) (ii) above
based on his Period of Benefit Accrual
Service after June 2, 1973; and
(B) the Actuarial Equivalent of his
Profit Sharing Plan Company Amount, if
any; or
(iv) the sum of (A) and (B):
(A) an amount determined under
Subsection (a)(i) above based on his
Period of Benefit Accrual Service after
October 1, 1973; and
(B) the Actuarial Equivalent of his
Thomson Company Plan Company
Amount, if any; and
(b) the Actuarial Equivalent of his Profit
Sharing Plan Member Amount or Thomson Company Plan
Member Amount, if any; less
(c) the Member's accrued benefit under the
terminated Manhattan Industries Inc. Employees' Benefit Plan
(As Amended Effective February 1, 1984) or the terminated
Vera Companies Division Employees' Pension Plan or the
terminated Manhattan Accessories Division Employees'
Pension Plan.
5.2. Minimum Accrued Benefit
(a) Notwithstanding any provision of the
Plan to the contrary, a Member's Accrued Benefit,
determined after November 30, 1989, shall not be less
than his Accrued Benefit, determined as of the earlier
of his Severance from Service Date and December 31,
1991, under the terms (including but not limited to
actuarial assumptions and equivalents) of the Plan or, if
applicable, the Manhattan Plan as in effect prior to this
Amendment and Restatement, based on his Period of
Benefit Accrual Service, Compensation and Average
Final Compensation, determined on the earlier of his
Severance from Service Date and December 31, 1991;
provided, however, that with respect to any Member
who was a highly compensated employee within the
meaning of section 414(q)(1)(A) or (B) of the Code for
the Plan Years ending November 30, 1990 and
November 30, 1991, such a Member's Accrued Benefit,
determined after November 30, 1989, shall not be less
than his Accrued Benefit, determined as of
November 30, 1989, under the terms of the Plan as in
effect prior to this Amendment and Restatement, based
on his years of Benefit Accrual Service, Compensation
and Average Final Compensation determined on
November 30, 1989; provided further, however, that a
Member who was such a highly compensated employee
for the Plan Year which ended November 30, 1991 but
not the Plan Year ended November 30, 1990, the
Member's Accrued Benefit, determined after
November 30, 1990, shall not be less than his Accrued
Benefit, determined as of November 30, 1990, under
the terms of the Plan as in effect prior to this
Amendment and Restatement, based on his years of
Benefit Accrual Service, Compensation and Average
Final Compensation determined on November 30, 1990;
and provided further, that any provision in the Plan to
the contrary notwithstanding, this Section 5.2 shall be
interpreted in a manner consistent with and reflective of
section 411(d)(6) of the Code such that nothing in the
Plan shall have the effect of decreasing an accrued
benefit of a Member or of eliminating or reducing an
early retirement benefit or a retirement-type subsidy or
eliminating an optional form of benefit with respect to
benefits attributable to service prior to January 1, 1992.
With respect to Members who were participants in the
Manhattan Plan, the references to November 30, 1989,
November 30, 1990, and November 30, 1991, in this
Section 5.2 shall be replaced with January 31, 1989,
January 31, 1990 and January 31, 1991, respectively,
and references to the terms of the Plan prior to this
Amendment and Restatement shall be replaced by the
terms of the Manhattan Plan prior to this Amendment
and Restatement.
(b) Notwithstanding any provision of the
Plan to the contrary, a Member's Accrued Benefit,
determined after December 31, 1993, shall not be less
than the greater of (1) his Accrued Benefit, determined
under the term of the Plan as in effect on and after
January 1, 1994, based on his entire Period of Benefit
Accrual Service, and (2) the sum of (1) his Accrued
Benefit, determined as of the earlier of his Severance
from Service Date and December 31, 1993, under the
terms (including but not limited to actuarial
assumptions and equivalents and the terms of
Subsection (a)) of the Plan as in effect prior to January
1, 1994, based on his Period of Benefit Accrual
Service, Compensation and Average Final
Compensation, determined on the earlier of his
Severance from Service Date and December 31, 1993,
and frozen in accordance with Treasury Regulation
Section 1.401(a)(4)-13 and (2) a Member's Accrued
Benefit, determined under the term of the Plan as in
effect on and after January 1, 1994, based on his Period
of Benefit Accrual Service and Compensation credited
after December 31, 1993.
ARTICLE VI
AMOUNT 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. or
Section 5.2.
(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 or Section 5.2.
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) The monthly amount of a Member's Vested
Deferred Benefit commencing at his Normal Retirement Date
on the Life Annuity form, as described in Section 7.3, shall be
equal to the sum of (i) and (ii):
(i) the greater of (A) and (B):
(A) a percentage, in accordance with the
following schedule, of the Accrued Benefit, as
determined in Section 5.1 (disregarding Sections
5.1(a) (iii) and (iv) and 5.1(b)):
Period of Vesting Service Percentage
Vested
less than 5 years 0
5 or more years 100
and
(B) the sum of (1) and (2):
(1) a percentage, in accordance with the
schedule in Subsection (a)(i)(A) above,
of the amount determined in Section
5.1(a)(iii) or (iv), if any; and
(2) the Actuarial Equivalent of his Profit
Sharing Plan Company Amount and
Thomson Company Plan Company
Amount, if any; and
(ii) his Profit Sharing Plan Member Amount and
Thomson Company Plan Member Amount, if any.
A Member who was a participant in the Manhattan Plan on
January 31, 1989, and whose Period of Vesting Service is 4 or
more years but less than 5 years shall be 40% vested in his
Accrued Benefit.
In no event shall the annual amount of a Member's Vested
Deferred Benefit be less than a percentage of his Minimum
Accrued Benefit determined in Section 5.2 in accordance with
the schedule in Subsection (a)(i)(A) above.
(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 7.14, 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 7.14, 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) A Member's Disability Benefit shall commence
on the first day of the sixth month following disability and
shall be an annual benefit on the Life Annuity form, as
described in Section 7.3, in an amount 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; and
(c) in any case, not less than the Actuarial
Equivalent of the sum of the Member's Profit Sharing Plan
Member Amount and Profit Sharing Plan Company Amount or
Thomson Company Plan Member Amount and Thomson
Company Plan Company Amount, if any.
6.7 Amount of Death Benefit
Any Member who has no Eligible Spouse or whose Eligible
Spouse is not eligible for immediate distribution of a Spouse's
Benefit under Section 6.6 and whose service has not
terminated or who has left employment after reaching his
Early Retirement Age is eligible for a death benefit if he has
at least 10 years of service and has attained age 45 and if the
sum of his age and his Period of Service is not less than 65.
If, after becoming eligible for the death benefit provided by
this section, a Member dies prior to his Benefit
Commencement Date, a death benefit shall be paid to his
Eligible Spouse or, if there is no Eligible Spouse, to a
surviving beneficiary designated by the Member in a written
election filed with the Committee. The Member may change
his designated beneficiary at any time. If no validly
designated beneficiary survives the Member, the death benefit
shall be paid to the Member's estate.
Subject to Section 7.6, the death benefit so payable shall be an
annual amount continued for the life of the payee (or in the
case of an Eligible Spouse, until such spouse becomes eligible
for distribution of the Spouse's Benefit under Section 6.6)
equal to the annual amount that would be payable to such
person if such person were the Member's surviving joint
annuitant under a 50% joint and survivor annuity (as
hereinafter defined) if such 50% joint and survivor annuity,
which commenced on the day preceding the Member's death,
had an actuarial value on the day preceding the Member's
death equal to the Actuarial Equivalent of the Member's
Accrued Benefit. A 50% joint and survivor annuity is a form
of annuity whereby an amount would be payable annually to
the Member during his life and thereafter, if the joint annuitant
survived the Member, 50% of such amount would be payable
annually to the Member's joint annuitant for life.
The death benefit payable to the Member's estate shall be a
lump sum equal to the actuarial value of the death benefit (as
measured immediately after the
Member's death) payable to a hypothetical surviving
designated beneficiary born on the third anniversary of the
Member's birth.
In no event shall the Death Benefit payable under this Section
7.6 be less than the Actuarial Equivalent of the sum of the
Member's Profit Sharing Plan Member Amount and Profit
Sharing Plan Company Amount or Thomson Company Plan
Member Amount and Thomson Company Plan Company
Amount, if any.
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 7.10, 7.11, 7.12, 7.14
or 7.15, 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 one of the following:
(a) the Life Annuity form under Section 7.3,
(b) subject to the conditions and restrictions
of Section 7.6, the Non-Qualified Joint and Survivor Annuity
form under Section 7.4,
(c) subject to the conditions and restrictions
of Section 7.6, the Period Certain Life Annuity form under
Section 7.5, or
(d) subject to the conditions and restrictions
of Section 7.6, the Optional Temporary Annuity form under
Section 7.7.
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, unless, subject to the
conditions and restrictions of Section 7.6, he elects the Non-
Qualified Joint and Survivor Annuity form under Section 7.4,
the Period Certain Life Annuity form under Section 7.5 or the
Optional Temporary Annuity form under Section 7.7.
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 Joint and Survivor Annuity form provides for monthly
payments to be made in accordance with one of the following
options:
Qualified Option - 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.
Non-Qualified Option - a monthly benefit
payable during the lifetime of
the Member and following his
death a monthly benefit
payable to his surviving joint
annuitant for the joint
annuitant's lifetime equal to
50%, 75% or 100% of the
monthly benefit payable to the
Member during his lifetime.
No benefit shall be payable
after the death of the Member
and his joint annuitant.
7.5 Period Certain Life Annuity form provides for monthly
payments continuing to the first day of the month in which the
Member's death occurs or the end of the certain period,
whichever is later. The certain period may be either 60
months, 120 months or 180 months. If the Member dies
before the end of the certain period, payments in the same
amount shall be continued to the end of such period to the
beneficiary authorized to receive payments in accordance with
Section 15.5.
7.6 The following conditions and restrictions are applicable to the
election of the Non-Qualified Joint and Survivor Annuity form
or the Period Certain Life Annuity form:
(a) A Member shall make his election on a
form provided by the Plan Administrator, and must designate
either his Normal Retirement Age, his Deferred Retirement
Date, his required beginning date determined under
Section 7.15, or, if earlier, the date he intends to retire as the
effective date of the election.
(b) If a Member elects the Non-Qualified
Joint and Survivor Annuity form, he must designate his joint
annuitant, the percentage of his benefit to be continued to his
joint annuitant, and provide satisfactory proof of the joint
annuitant's age.
(c) If a Member elects the Period Certain
Life Annuity form he must designate his beneficiary.
(d) If a Member, or, in the case of the Non-
Qualified Joint and Survivor Annuity form, the joint annuitant,
dies before the effective date of the election, the election will
be cancelled.
(e) If a joint annuitant or a beneficiary is
other than a Member's Eligible Spouse and if the value of the
Member's benefit under the elected form of annuity would be
less than 51% of the value of his benefit that would be
payable on the Life Annuity form, such benefit on the form of
annuity elected shall be adjusted so that the value of the
Member's benefit under the form elected shall be equal to 51%
of the value of the Member's benefit on the Life Annuity form.
7.7 Optional Temporary Annuity Form
A Member whose Retirement Benefit or Vested Deferred
Benefit commences under the Plan before the earliest date on
which his primary insurance amount beginning under the
Social Security Act may elect to receive an adjusted benefit
prior to the first date on which he becomes eligible to receive
such primary insurance amount and a reduced benefit
thereafter. The adjusted benefit shall be calculated so that the
Retirement Benefit or Vested Deferred Benefit payable to the
Member prior to the date on which he becomes eligible to
receive his primary insurance amount shall be equal as nearly
as possible to the sum of (a) the reduced amount payable after
such date and (b) the estimated primary insurance amount
payable to the Member beginning on such date.
A Member may elect this Optional Temporary Annuity by
filing a written request with the Committee prior to his
Retirement Date.
7.8 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 and 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 7.15.
(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).
7.9 Lump Sums
If any portion of a Member's Accrued Benefit consists of a
Profit Sharing Plan Member Amount or Thomson Company
Plan Member Amount, the Member may elect, subject to
Spousal Consent, to receive such amount at any time following
his Severance from Service Date in a lump sum.
If as of a Member's Benefit Commencement Date, his Accrued
Benefit is equal to the sum of the amounts specified in
Sections 5.1(a)(iii) and 5.1(b) or 5.1(a)(iv) and 5.1(b):
(a) the Member may elect, subject to Spousal
Consent, to receive distribution of his Retirement Benefit or
Vested Deferred Benefit, as the case may be, in a lump sum,
or
(b) the Member's Eligible Spouse or designated
beneficiary may elect to receive distribution of the Spouse's
Benefit or Death Benefit, as the case may be, in a lump sum.
7.10 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.
7.11 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.
7.12 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.
7.13 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.
7.14 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.
7.15 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
Paragraph (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 7.14, 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.
7.16 Direct Transfers - If a Member who is entitled to a distribution
of at least $200 which is an "eligible rollover distribution," as
defined in section 402(f)(2)(a) of the Code, 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 section
402(c)(8)(B) of the Code, 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 Member'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 made held in the Trust.
8.3 Contributions to the Plan shall be returned to the Company 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 greatest 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,
(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), and
(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 Plan, 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 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 in 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 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 Board'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(j) of the Plan, but determined
without regard to Sections 125, 402(a)(8) and 402(h)(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) Except as provided in Section 10.3(a)(3), 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.
(3) Notwithstanding Paragraphs (1) and (2) of
this Section 10.3(a), the Plan shall not be a Top-Heavy Plan
for any Plan Year in which the Plan is a member of an
Aggregation Group with respect to which the percentage test
described in Section 10.3(a)(2)(B) is not met.
(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 the 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 December 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 Year of 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 (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 (3) 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.
10.6 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(d)(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.
ARTIC LE XI
ADMIN ISTRATION; 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 on all parties. The
Committee shall also have the responsibility for compiling and
communicating to the Investment Manger, 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 Section 11.7 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 Section, 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 Salant Corporation 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
Salant Corporation 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 Salant Corporation'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 other
Company 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
LIMI TATION 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
Subsection (a), 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 XV
MISCELLANEOUS 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, Salant Corporation, 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:
. . .
6977
03/23/95
APPENDIX A
ADOPTING COMPANIES
Name
Effective Date
Salant Corporation
January 1, 1979
Denton Mills, Inc.
January 1, 1992