Exhbit 10.1
INVACARE
RETIREMENT SAVINGS PLAN
Effective: January 1, 2001
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TABLE OF CONTENTS
ARTICLE NO.
NAME AND PURPOSE 1
DEFINITIONS 2
PARTICIPATING EMPLOYERS 3
ELIGIBILITY AND PARTICIPATION 4
SALARY DEFERRAL CONTRIBUTIONS 5
PARTICIPATING EMPLOYER CONTRIBUTIONS 6
TRUST FUNDS AND DIRECTION OF INVESTMENT 7
ACCOUNTS 8
WITHDRAWALS FROM ACCOUNTS 9
HARDSHIP DISTRIBUTIONS 10
PARTICIPANT LOANS 11
TERMINATION OF EMPLOYMENT 12
RETIREMENT AND DISABILITY BENEFITS 13
DEATH BENEFITS 14
DISTRIBUTIONS 15
ADMINISTRATION 16
PROHIBITION AGAINST ALIENATION 17
AMENDMENT AND TERMINATION 18
LIMITATIONS ON CONTRIBUTIONS 19
LIMITATION ON ANNUAL ADDITIONS 20
ROLLOVERS AND TRANSFERS INVOLVING OTHER
QUALIFIED RETIREMENT PLANS 21
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SPECIAL PROVISIONS WITH RESPECT TO SHARES 22
TOP-HEAVY PROVISIONS 23
MISCELLANEOUS 24
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INDEX
ARTICLE NO.
ACCOUNTS 8
ADMINISTRATION 16
AMENDMENT AND TERMINATION 18
DEATH BENEFITS 14
DEFINITIONS 2
DISTRIBUTIONS 15
ELIGIBILITY AND PARTICIPATION 4
HARDSHIP DISTRIBUTIONS 10
LIMITATION ON ANNUAL ADDITIONS 20
LIMITATIONS ON CONTRIBUTIONS 19
MISCELLANEOUS 24
NAME AND PURPOSE 1
PARTICIPANT LOANS 11
PARTICIPATING EMPLOYER CONTRIBUTIONS 6
PARTICIPATING EMPLOYERS 3
PROHIBITION AGAINST ALIENATION 17
RETIREMENT AND DISABILITY BENEFITS 13
ROLLOVERS AND TRANSFERS INVOLVING OTHER
QUALIFIED RETIREMENT PLANS 21
SALARY DEFERRAL CONTRIBUTIONS 5
SPECIAL PROVISIONS WITH RESPECT TO SHARES 22
TERMINATION OF EMPLOYMENT 12
TOP-HEAVY PROVISIONS 23
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TRUST FUNDS AND DIRECTION OF INVESTMENT 7
WITHDRAWALS FROM ACCOUNTS 9
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AMENDMENT AND RESTATEMENT
OF THE
INVACARE CORPORATION
PROFIT SHARING AND SAVINGS TRUST AND PLAN
AS THE
INVACARE
RETIREMENT SAVINGS PLAN
THIS AMENDMENT AND RESTATEMENT is adopted by INVACARE CORPORATION, a
corporation organized and existing under the laws of the State of Ohio
(hereinafter called the "Company");
W I T N E S S E T H:
WHEREAS, effective January 1, 1988, the Company established the Invacare
Corporation Profit Sharing and Savings Trust and Plan (hereinafter called the
"Profit Sharing Plan"); and
WHEREAS, under the terms of the Plan, the Company reserved the right to
amend the Plan by action of its Board of Directors; and
WHEREAS, it is the desire of the Company to amend and restate the Profit
Sharing Plan in order to reflect the merger of the Invacare Corporation
Employees' Stock Bonus Trust and Plan into the Profit Sharing Plan, to bring the
Profit Sharing Plan into compliance with the General Agreement on Tariffs and
Trade, the Uniformed Services Employment and Reemployment Rights Act of 1994,
the Small Business Job Protection Act of 1996, the Taxpayer Relief Act of 1997,
and the Economic Growth and Tax Relief Reconciliation Act of 2001, and to make
certain other desirable changes;
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NOW, THEREFORE, in consideration of the mutual covenants, conditions and
agreements herein contained, it is mutually agreed that the Profit Sharing Plan
be amended and restated as the Invacare Retirement Savings Plan (hereinafter
called the "Plan"), such Amendment and Restatement being generally effective as
of the first day of January, 2001, as follows:
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ARTICLE 1
NAME AND PURPOSE
1.1 Name and Purpose. The name of this Plan shall be INVACARE RETIREMENT
SAVINGS PLAN. The purpose of this Plan is to provide benefits to the
Participants in this Plan upon their retirement, termination of employment or
the happening of certain contingencies as hereinafter described, to provide such
other benefits to such Participants and their Beneficiaries as are hereinafter
described and to provide such Participants with a method of acquiring a stock
ownership interest in the Company, through the maintenance within this Plan of a
stock bonus plan feature.
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ARTICLE 2
DEFINITIONS
Unless the context otherwise indicates, the following terms used herein
shall have the following meanings whenever used in this instrument:
2.1 Account or Accounts. The word "Account" or "Accounts" shall mean
"Salary Deferral Accounts", "Matching Contribution Accounts", "Stock Bonus
Accounts", "After-Tax Accounts", "Profit Sharing Accounts", "Employer
Contribution Accounts", and "Rollover Accounts", as more fully described in
Article 8 hereof.
2.2 Active Participant. The words "Active Participant" shall mean, except
as provided in Section 4.4, a Participant who is a Covered Employee.
2.3 Administrator. The word "Administrator" shall mean the person or
persons, corporation or partnership designated as Administrator under Article 16
hereof.
2.4 Adoption Date. The words "Adoption Date" shall mean, with respect to a
Participating Employer, the date as of which it shall have become a
Participating Employer in accordance with Article 3 hereof.
2.5 Affiliate. The word "Affiliate" shall mean any corporation or business
organization during any period in which it is a member of a controlled group of
corporations or trades or businesses which includes the Company within the
meaning of Sections 414(b) and 414(c) of the Code, is a member of an affiliated
service group which includes the Company within the meaning of Section 414(m) of
the Code or is part of any other arrangement as defined in regulations under
Section 414(o) of the Code which includes the Company, but, in each case, only
during the periods any corporation or business organization would be so defined.
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2.6 Allocation Date. The words "Allocation Date" shall mean the last day of
each calendar year quarter ending after the Restatement Date.
2.7 Alternate Payee. The words "Alternate Payee" shall mean any spouse,
former spouse, child or other dependent of a Participant or former Participant
who is recognized by a Domestic Relations Order as having a right to receive
all, or a portion of, such Participant's or former Participant's Account
balances.
2.8 Annuity Elimination Date. The words "Annuity Elimination Date" shall
mean the later of:
(a) September 1, 2001; and
(b) ninety (90) days after a Summary of Material Modifications to this
Plan is given to the Participants describing the elimination of annuity
forms of payment.
2.9 Annuity Starting Date. The words "Annuity Starting Date" shall mean for
a Participant the first day of the first period for which he receives an amount
as an annuity by reason of his retirement or Termination of Employment under the
terms of this Plan, or in the case of a benefit which is not payable in the form
of an annuity, the first day on which all events have occurred which entitled
the Participant to such benefit.
2.10 Beneficiary. The word "Beneficiary" shall mean any person, other than
an Alternate Payee as defined in Section 2.7 hereof, who receives or is
designated to receive payment of any benefit under the terms of this Plan
because of the participation of another person in this Plan.
2.11 Board of Directors or Board. The words "Board of Directors" or "Board"
shall mean the board of directors of the Company.
2.12 Code. The word "Code" shall mean the Internal Revenue Code of 1986, as
such may be amended from time, and any lawful regulations or rulings thereunder.
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2.13 Committee. The word "Committee" shall mean the Administrative
Committee which shall be invested by the Board of Directors with the power to
administer the Plan as further provided in Article 16 hereof.
2.14 Company. The word "Company" shall mean INVACARE CORPORATION or any
successor corporation or business organization which shall assume the
obligations of the Company under this Plan as provided herein with respect to
the Participants. Any actions which the Company is required or authorized to
take hereunder shall be taken by the Board of Directors or any committee or
officer duly authorized by the Board of Directors.
2.15 Compensation. The word "Compensation" generally shall mean all
remuneration paid in cash to a Participant during a Plan Year for services
rendered to a Participating Employer, specifically including but not limited to
wages, salaries, commissions, overtime, bonuses, whether discretionary or
non-discretionary, incentive pay, vacation pay, severance (salary continuation)
pay, holiday pay, and, short-term disability pay. Compensation shall also be
increased for salary reduction amounts which are excluded from the taxable
income of the Participant under Sections 125, 132(f)(4), 402(e)(3) and 402(h) of
the Code.
Compensation shall not include any of the following amounts:
(a) expense reimbursements, expense allowances, or moving expenses;
(b) any cash and non-cash fringe benefits and welfare benefits;
(c) deferred compensation;
(d) all amounts related to stock options, whether qualified or
nonqualified;
(e) miscellaneous earnings, including but not limited to periodic
payments to certain Employees in lieu of a parking subsidy;
(f) vacation pay in lieu of time off for Participants whose employment
with the Participating Employers and Affiliates has terminated;
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(g) earnings or benefits paid on behalf of a deceased Participant;
(h) prizes or awards;
(i) unused sick pay;
(j) automobile expenses;
(k) tuition reimbursements; and
(l) meal allowances.
Compensation also shall not include any remuneration paid to a Participant
during a period in which he is not an Active Participant in this Plan.
In addition, a Participant's Compensation shall not exceed One Hundred
Seventy Thousand Dollars ($170,000.00) or, effective January 1, 2002, Two
Hundred Thousand Dollars ($200,000) (plus any adjustment for cost-of-living
or otherwise as shall be prescribed by the Secretary of the Treasury
pursuant to Sections 401(a)(17)(B) and 415(d) of the Code).
2.16 Covered Employee. The words "Covered Employee" shall mean any Employee
of a Participating Employer, excluding:
(a) an Employee whose terms and conditions of employment are covered
by a collective bargaining agreement which does not require him to be
included in this Plan;
(b) an individual employed in a capacity categorized by the Company as
a Leased Person, regardless of his status as may be determined otherwise by
the Commissioner of the Internal Revenue Service or other government entity
or any court or tribunal;
(c) a temporary employee;
(d) an Employee who is neither a resident nor a citizen of the United
States of America and who receives no earned income, within the meaning of
Code Section 911(b) from the Participating Employers or their Affiliates
which constitutes income from sources within the United States, within the
meaning of Code Section 861(a)(3) ("non-resident alien");
(e) an individual employed in a capacity categorized by the Company as
an "independent contractor" pursuant to a written or oral agreement with a
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Participating Employer, regardless of his status as may be determined
otherwise by the Commissioner of the Internal Revenue Service or other
government entity; and
(f) an Employee who is employed in accordance with an employment,
consulting or other arrangement, the terms and conditions of which preclude
his participation in this Plan.
Any such Employee shall cease to be a Covered Employee upon the
earliest to occur of:
(a) his Termination of Employment;
(b) his ceasing to be employed by a Participating Employer;
(c) the terms and conditions of his employment becoming covered by a
collective bargaining agreement which does not require him to be included
in this Plan;
(d) his becoming a non-resident alien; or
(e) his becoming a Leased Employee, an independent contractor or an
Employee who is employed in accordance with an employment, consulting or
other arrangement, the terms and conditions of which preclude his
participation in this Plan.
2.17 Date of Hire. The words "Date of Hire" shall mean the first day during
which an Employee performs an Hour of service for a Participating Employer or
any Affiliate for which he is directly or indirectly compensated or the first
day for which the Employee is paid any back pay pursuant to an award or
agreement. In the case of a rehired Employee, "Date of Hire" shall mean the
first day following his previous Termination of Employment during which the
Employee performs an Hour of service for a Participating Employer or any
Affiliate for which he is directly or indirectly compensated or the first day
following his previous Termination of Employment for which the Employee is paid
any back pay pursuant to an award or agreement.
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2.18 Domestic Relations Order. The words "Domestic Relations Order" shall
mean, with respect to any Participant or former Participant, any judgment,
decree or order (including approval of a property settlement agreement) which
both:
(a) relates to the provisions of child support, alimony payments or
marital property rights to a spouse, former spouse, child or other
dependent of the Participant or former Participant; and
(b) is made pursuant to a State domestic relations law (including a
community property law).
2.19 Effective Date. The words "Effective Date" of this Plan shall mean
January 1, 1988.
2.20 Eligibility Break In Service. The words "Eligibility Break In Service"
shall mean a Plan Year, ending after an Employee's Termination of Employment,
during which he did not complete more than five hundred (500) Hours for a
Participating Employer or an Affiliate. Notwithstanding the foregoing provisions
of this Section, in the event any Employee ceases to be actively employed by a
Participating Employer or an Affiliate either:
(a) by reason of the pregnancy of such Employee; or
(b) by reason of the birth of a child of such Employee; or
(c) by reason of the placement of a child with such Employee in
connection with the adoption of such child by such Employee; or
(d) by reason of caring for such child for a period beginning
immediately following such birth or placement;
such Employee shall, solely for the purposes of determining whether such
Employee has incurred an Eligibility Break In Service pursuant to this Section,
be credited either with the Hours of service which otherwise would normally have
been credited to such Employee but for such absence or, in any case in which the
Administrator is unable to determine the Hours described in the preceding
clause, eight (8) hours per day of such absence; provided, however, that the
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total number of Hours of service which an Employee may be credited with by
reason of any such pregnancy, birth or placement shall not exceed five hundred
one (501) hours. An Employee shall be credited with the Hours of service
described in the preceding sentence only in the Plan Year in which the absence
from work begins if the Employee would be prevented from incurring an
Eligibility Break In Service in such Plan Year solely because the Employee is
credited with Hours of service pursuant to the preceding sentence or, in any
other case, in the immediately following Plan Year.
2.21 Eligibility Service. The words "Eligibility Service" shall mean for
any Employee his period of Service (as defined in Section 2.50 hereof),
excluding any period of Service prior to a Termination of Employment if both of
the following apply:
(a) he shall have incurred at least five (5) consecutive Eligibility
Breaks In Service since the last day of such Eligibility Service; and
(b) his Eligibility Service is less than or equal to the number of
consecutive Eligibility Breaks In Service which he had after the last day
of such Eligibility Service.
2.22 Employee. The word "Employee" shall mean any common law employee,
whether compensated on a salaried basis, an hourly wage rate basis or a
commission-only basis, of a Participating Employer or any Affiliate and shall
also include a Leased Person. The word "Employee" shall not include any person
who renders service to a Participating Employer solely as a director or
independent contractor.
2.23 Enrollment Date. The words "Enrollment Date" shall mean for purposes
of Article 4 hereof, the first day of any calendar month beginning on and after
the Restatement Date.
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2.24 ERISA. The acronym "ERISA" shall mean the Employee Retirement Income
Security Act of 1974, as such may be amended from time to time, and any lawful
regulations or rulings thereunder.
2.25 Fair Market Value. The words "Fair Market Value" shall mean with
respect to the Shares that price at which a Share would change hands between a
willing buyer and a willing seller, neither being under any compulsion to buy or
sell and both having reasonable knowledge of the relevant facts, including (but
not limited to) the nature and history of the business, current and prospective
economic conditions, book values, current asset values, earnings capacity,
dividend-paying capacity, goodwill, rates of capitalization for comparable
businesses, recent sales of Shares (if any), market value of comparable
businesses, lack of established marketability, contractual conditions which
restrict transfer and the effect of loss of key men. In the event the Shares are
not readily tradable on an established securities market, the Trustee shall
rely, for all purposes under this Plan, upon an independent appraisal as
described in Section 401(a)(28) of the Code. In the event Shares are readily
tradable on an established securities market, the Fair Market Value of a Share
shall be determined with reference to appropriate market quotations.
2.26 Highly Compensated Employee. The words "Highly Compensated Employee"
shall mean an Employee who is a "highly compensated employee" for a Plan Year as
described in Section 414(q) of the Code which is hereby incorporated by
reference and who is described for informational purposes herein as an Employee
during a Plan Year if either:
(a) during the preceding Plan Year, he:
(i) was at any time a five percent (5%) actual or constructive
owner of a Participating Employer and its Affiliates; or
(ii) received Testing Compensation from a Participating Employer
and its Affiliates greater than Eighty Thousand Dollars ($80,000.00)
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(plus any increase for cost of living after 1998 as determined by the
Secretary of the Treasury or his delegate) and, if the Company so
elects, was in the "Top Paid Group" of Employees of a Participating
Employer and its Affiliates for such Plan Year; or
(b) during the current Plan Year, he was at any time a five percent
(5%) or more actual or constructive owner of a Participating Employer and
its Affiliates.
2.27 Hour. The word "Hour" shall mean for any Employee the actual number of
hours for which he is directly or indirectly paid by a Participating Employer or
any Affiliate for the performance of duties either as regular wages, salary or
commissions, or for reasons other than the performance of duties such as
vacation or holiday pay, and in either case, including payments pursuant to an
award or agreement requiring a Participating Employer or an Affiliate to pay
back wages, irrespective of mitigation of damages. Hours due to a back pay award
or agreement shall be credited in the year or years to which the award or
agreement pertains, rather than in the year or years in which the award,
agreement or payment is made and shall be credited only to the extent such hours
are not otherwise credited. For purposes of this Plan, any hours which are
compensated at overtime or premium rates shall be computed as straight-time
Hours. Hours under this paragraph shall be calculated and credited pursuant to
Section 2530.200b-2(b) and (c) of the Department of Labor Regulations which are
incorporated herein by reference. An Employee who is not paid on the basis of
the actual number of hours worked shall be credited with 45 hours for each week
during which such Employee is credited with at least one (1) Hour.
Notwithstanding the foregoing,
(a) no Employee shall be credited with more than 501 hours with
respect to payments he receives or is entitled to receive during any single
continuous period (whether or not such period occurs in a single Plan Year)
during which he performs no services for a Participating Employer or an
Affiliate (irrespective of whether he has terminated employment) due to
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vacation, holiday, illness, incapacity (including disability), layoff, jury
duty, military duty, or Leave of Absence;
(b) no Employee shall be credited with hours with respect to payments
he receives or is entitled to receive during a period when he performs no
services for a Participating Employer or an Affiliate under a plan
maintained solely for the purpose of complying with applicable workers'
compensation, unemployment compensation, disability insurance or Federal
Social Security laws; and
(c) no Employee or former Employee shall be credited with hours with
respect to payments he receives or is entitled to receive under a pension
benefit plan to which a Participating Employer or an Affiliate has
contributed during a period when he performs no services for a
Participating Employer or an Affiliate.
2.28 Invacare Segregated Stock Fund. The words "Invacare Segregated Stock
Fund" shall mean a fund which is invested solely in whole Shares and cash for
any fractional Share credited to such fund. It is intended that only such cash
as is needed to reflect a fractional Share credited to such fund and as is
reserved to make cash distributions to Participants will be held in the Invacare
Segregated Stock Fund.
2.29 Investment Fund. The words "Investment Fund" shall mean a fund, other
than the Invacare Segregated Stock Fund, established, maintained and
administered by the Trustee pursuant to Articles 7 and 15 hereof.
2.30 Leased Person. The words "Leased Person" shall mean, on and after
January 1, 1997, any individual (other than a common-law Employee of a
Participating Employer or an Affiliate) who, pursuant to an agreement between a
Participating Employer or an Affiliate and any leasing organization, has
performed services for the Participating Employer or an Affiliate or for related
persons, as determined in accordance with Code Section 414(n)(6), on a
substantially full-time basis for a period of at least one (1) year; provided,
however, that such services are performed under the primary direction or control
of such Participating Employer. Contributions or benefits provided on behalf of
a Leased Person by the leasing organization which are attributable to services
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performed for the Participating Employer shall be treated as provided by the
Participating Employer.
A Leased Person shall not be considered an Employee of a Participating
Employer if:
(a) such Leased Person is covered by a money purchase pension plan
which provides the following:
(i) a nonintegrated employer contribution formula of at least ten
percent (10%) of a Leased Person's Compensation, as defined in Section
2.15 hereof, together with amounts contributed on his behalf pursuant
to a salary reduction agreement which are excludable from the Leased
Person's gross income pursuant to Code Section 125, 132(f)(4),
402(e)(3), 402(h) or 403(b);
(ii) immediate participation in said money purchase pension plan;
and
(iii) full and immediate vesting under said money purchase
pension plan; and
(b) Leased Persons do not constitute more than twenty percent (20%) of
the non-Highly Compensated Employees of the Company and its Affiliates.
2.31 Leave of Absence. The words "Leave of Absence" shall mean:
(a) that period of unpaid interruption of active employment of an
Employee caused by entrance into the Armed Forces of the United States
under such circumstances that he thereby becomes entitled to reemployment
rights under the law; and
(b) that period of unpaid interruption of active employment of an
Employee authorized by a Participating Employer for a period not to exceed
one (1) year, with the understanding that the Employee will return to
active employment at the expiration of such period, such interruption to be
for a specified purpose such as sickness, short term disability, research,
study, pregnancy, family responsibilities and layoff.
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All such unpaid Leaves of Absence shall be granted on a uniform and
non-discriminatory basis. Except as provided below, a Participant on an unpaid
Leave of Absence shall not be considered to be an Active Participant and shall
not be allocated any portion of Participating Employer contributions or
forfeitures.
Notwithstanding the foregoing, a Participant who is on an approved Leave of
Absence under the Family and Medical Leave Act of 1993 shall be considered an
Active Participant for the duration of such Leave of Absence and shall accrue
Service for purposes of vesting under the terms of this Plan.
2.32 Merger Date. The words "Merger Date" shall mean the beginning of the
day on January 1, 2001.
2.33 Military Service. The words "Military Service" shall mean duty in the
uniformed services of the United States, whether voluntary or involuntary,
provided that the Employee serves not more than one voluntary enlistment or tour
of duty, and further provided that such voluntary enlistment or tour of duty
does not follow involuntary duty.
Notwithstanding any provision of this Plan to the contrary, effective
December 12, 1994, contributions, benefits, and service credit with respect to
qualified military service will be provided in accordance with Section 414(u) of
the Code, which, as applicable to this Plan, generally provides for certain
periods of qualified military service to constitute, upon a Participant's
reemployment, Service hereunder. In addition, upon such a Participant's
reemployment, he shall be permitted to make such salary deferral contributions
in an amount not to exceed the maximum the Participant would have been permitted
to contribute during the period of qualified military service if he had actually
been employed by a Participating Employer during such period, in accordance with
the provisions of Section 414(u) of the Code. Matching contributions will be
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made on such salary deferral contributions, as applicable. Finally, the
Participant will be entitled to receive an employer contribution pursuant to
Section 6.1 hereof as though he had been employed during such period, in
accordance with the provisions of Section 414(u) of the Code.
2.34 Normal Retirement Date. The words "Normal Retirement Date" shall mean
for any Participant the later of:
(a) the date on which he attains age sixty-five (65); and
(b) the date he completes five (5) years of Vesting Service.
Notwithstanding the preceding sentence, the Normal Retirement Date of any
Participant who was a participant in the Invacare Corporation Profit Sharing
Retirement Plan or the Mobilite Corporation Profit Sharing Plan as of December
31, 1987 shall be the date on which he attains age sixty-five (65).
2.35 Participant. The word "Participant" shall mean any eligible Employee
who has become a Participant in this Plan in accordance with Article 4 hereof.
The word "Participant" shall also include, as the context may require, any
person who has ceased to be an Active Participant due to his no longer being a
Covered Employee and any person who has become a former Participant due to his
having incurred Termination of Employment, provided that such person has an
Account balance.
2.36 Participating Employer. The words "Participating Employer" shall mean
the Company and any Affiliate which is or shall become a Participating Employer
in this Plan pursuant to Article 3 hereof.
2.37 Party in Interest. The words "Party in Interest" shall mean any person
who is a party in interest within the meaning of Section 3(14) of ERISA. For
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purposes of determining whether a person is a Party in Interest under the loan
provisions contained in Article 11, the words "Party in Interest" generally
refer to a former Employee who is either an officer or director of the Company
or an Affiliate.
2.38 Period of Severance. The words "Period of Severance" shall mean for
any Employee or former Employee a period commencing on his Termination of
Employment and ending on the date such Employee or former Employee is rehired by
a Participating Employer or any Affiliate. A "One Year Period of Severance"
shall mean a twelve (12) month Period of Severance during which an Employee is
not credited with at least one (1) Hour for a Participating Employer or any
Affiliate. Notwithstanding the foregoing provisions of this Section, in the
event any Employee ceases to be actively employed by a Participating Employer or
an Affiliate either:
(a) by reason of the pregnancy of such Employee; or
(b) by reason of the birth of a child of such Employee; or
(c) by reason of the placement of a child with such Employee in
connection with the adoption of such child by such Employee; or
(d) by reason of caring for such child for a period beginning
immediately following such birth or placement;
such Employee's Period of Severance shall be deemed to have commenced on the
later of the first anniversary of the date he ceased to be actively employed or
his Termination of Employment. In addition, an Employee who is on a leave of
absence due to Military Service will not incur a Period of Severance during or
as a result of such leave of absence, to the extent required by Section 414(u)
of the Code.
2.39 Plan. The word "Plan" shall mean this instrument as originally
executed and as it may be amended from time to time hereafter.
2.40 Plan Year. The words "Plan Year" shall mean the calendar year.
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2.41 Profit Sharing Plan. The words "Profit Sharing Plan" shall mean the
Invacare Corporation Profit Sharing and Savings Trust and Plan as constituted
immediately prior to the Restatement Date.
2.42 Publicly Traded. The words "Publicly Traded" shall mean with respect
to any Shares that such Shares are listed on a national securities exchange
registered under Section 6 of the Securities Exchange Act of 1934 or that such
Shares are quoted on a system sponsored by a national securities association
registered under Section 15(A)(b) of the Securities Exchange Act of 1934.
2.43 Qualified Domestic Relations Order. The words "Qualified Domestic
Relations Order" shall mean a Domestic Relations Order which satisfies the
requirements of Section 414(p)(1)(A) of the Code.
2.44 Qualified Joint and Survivor Annuity. The words "Qualified Joint And
Survivor Annuity" shall mean an annuity, the actuarial equivalent of which is
equal to the aggregate of the Participant's distributable Accounts, and which
for a married Participant is payable for the life of such Participant, with a
survivor annuity for the remaining life of his spouse which is fifty percent
(50%) of the amount of the annuity paid to such Participant during his life, and
for an unmarried Participant is payable for the life of such Participant.
2.45 Qualified Participant. The words "Qualified Participant" shall mean a
Participant or former Participant who has attained age fifty-five (55) and has
completed ten (10) years of Service.
2.46 Qualified Preretirement Survivor Annuity. The words "Qualified
Preretirement Survivor Annuity" shall mean an annuity for the life of a
Participant's surviving spouse or other Beneficiary, the actuarial equivalent of
which is equal to one hundred percent (100%) of the aggregate of the
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Participant's distributable Accounts as of the date of his death, as determined
in accordance with Article 14 hereof.
2.47 Related Employer. The words "Related Employer" shall mean a
corporation which would be defined as a member of a controlled group of
corporations which includes a Participating Employer or any business
organization which would be defined as a trade or business (whether or not
incorporated) which is under "common control" with a Participating Employer
within the meaning of Code Sections 414(b) and (c) and any lawful regulation
issued thereunder, and after substituting the phrase "more than fifty percent
(50%)" for the phrase "at least eighty percent (80%)" each place that the latter
phrase appears in Code Section 1563(a)(1), and any member of an "affiliated
service group," as defined in Code Section 414(m), which includes a
Participating Employer but, in each case, only during the periods any such
corporation, business organization or member would be so defined.
2.48 Restatement Date. The words "Restatement Date" shall mean the date on
which this Amendment and Restatement generally became effective, which date is
January 1, 2001.
2.49 Salary Deferral Contributions. The words "Salary Deferral
Contributions" generally shall mean contributions made to this Plan by a
Participating Employer on behalf of an Active Participant pursuant to such
Active Participant's election under Section 5.1 hereof and paid to the Trustee
pursuant to Section 5.3 hereof.
2.50 Service. The word "Service" shall mean for any Employee the aggregate
of the periods during which he is or was employed by a Participating Employer or
any Affiliate. Each such period shall be measured from his Date of Hire to the
date of Termination of Employment which follows such Date of Hire.
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Notwithstanding the foregoing, in no event shall an Employee's Service be
less than his Years of Service under the terms of the Plan or the Stock Bonus
Plan prior to the Restatement Date. Specifically, for periods prior to the
Restatement Date, an Employee's "Years of Service" shall mean the computation
periods of twelve (12) consecutive months during which the Employee completed at
least 1,000 Hours. In addition, an Employee who had accounts transferred to the
Profit Sharing Plan from a predecessor plan shall receive credit for his service
under such predecessor plan.
In addition, if any Employee has a Termination of Employment and is rehired
within twelve (12) months of:
(a) the date of his Termination of Employment; or
(b) if earlier, the first day of any period of Leave of Absence or
Military Service after the end of which the Employee did not return to work
for a Participating Employer or any Affiliate prior to his Termination of
Employment;
such Employee's "Service" shall include the Period of Severance measured from
the date of his Termination of Employment until his subsequent Date of Hire. Two
(2) or more periods of employment or Periods of Severance that are included in
an Employee's Service and that contain fractions of a year (computed in months
and days) shall be aggregated on the basis of twelve (12) months constituting a
year and thirty (30) days constituting a month.
The "Service" of an Employee who shall be reemployed by a Participating
Employer or any Affiliate following a Termination of Employment shall not
include the length of any of his periods of Service rendered prior to the date
of said Termination of Employment if all of the following apply:
(i) he did not have a Vested Interest under this Plan or the
Prior Plans on such date of Termination of Employment; and
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(ii) he shall have incurred five (5) consecutive One Year Periods
of Severance; and
(iii) his period of Service immediately prior to such Termination
of Employment shall have been less than or equal to his Period of
Severance after the last day of such period of Service.
In the event that a Participant returns to employment with a Participating
Employer or an Affiliate immediately following a leave of absence due to
Military Service, his period of Military Service shall be included in the
calculation of his Service, to the extent required by Section 414(u) of the
Code.
2.51 Share Adjustment. The words "Share Adjustment" shall mean an event
whereby the number of Shares held by the Trustee shall change by reason of a
stock dividend, stock split or reverse stock split, or as a result of a
reorganization or recapitalization of Invacare or an Affiliate.
2.52 Shares. The word "Shares" shall mean shares of the common stock of
Invacare, par value $.01 per share.
2.53 Stock Bonus Plan. The words "Stock Bonus Plan" shall mean the Invacare
Corporation Employees' Stock Bonus Trust and Plan as constituted immediately
prior to the Restatement Date.
2.54 Supplemental Agreement. The words "Supplemental Agreement" shall mean
an agreement adopted by the Company pursuant to Section 3.3 hereof setting forth
special provisions applicable to specific groups of Employees, former Employees
or Beneficiaries of deceased Employees.
2.55 Taxable Year. The words "Taxable Year" shall mean the Company's annual
accounting period which presently is the calendar year.
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2.56 Termination Date. The words "Termination Date" shall mean the date on
which any Participating Employer ceases to participate in the Plan, as set forth
in Section 3.1 hereof.
2.57 Termination of Employment. The words "Termination of Employment" shall
mean for any Employee the occurrence of any one of the following events:
(a) he is discharged unless he is subsequently reemployed by a
Participating Employer or an Affiliate and given pay back to his date of
discharge;
(b) he voluntarily terminates his employment with a Participating
Employer or any Affiliate;
(c) he retires from employment with a Participating Employer or any
Affiliate;
(d) he fails to return to work:
(i) at the end of any Leave of Absence other than one due to
Military Service; or
(ii) after a recall to work following a period of layoff; or
(iii) within ninety (90) days following such Employee's release
from Military Service or within any other period following Military
Service in which his right to reemployment with a Participating
Employer or any Affiliate is guaranteed by law; or
(iv) after the cessation of disability income payments under a
program of a Participating Employer;
(e) he has been continuously laid-off for twenty-four (24) months;
(f) the stock or assets of the business unit by which the Employee is
employed are sold to a person or entity which is not an Affiliate of a
Participating Employer or are transferred to a joint venture which is not
an Affiliate of a Participating Employer and this Plan is assumed by such
person, entity or joint venture, his Termination of Employment (as defined
in subparagraphs (a) through (d) above) with such person, entity or joint
venture; or
(g) the stock or assets of the business unit by which the Employee is
employed are sold to a person or entity which is not an Affiliate of a
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Participating Employer or are transferred to a joint venture which is not
an Affiliate of a Participating Employer and this Plan is not assumed by
such person, entity or joint venture, the date of sale of the stock or
assets or the date of such transfer.
In the case of the occurrence of any event described in subparagraph (d) of this
Section (except for Employees on approved Leave of Absence under subparagraph
(d)(i) of this Section under the Family and Medical Leave Act of 1993), the date
of such Employee's Termination of Employment shall be deemed to be the earlier
of (i) the first anniversary of the first day of any such period of Leave of
Absence, layoff, Military Service, sick leave or disability leave or (ii) the
last day of any such period of Leave of Absence, layoff, Military Service, sick
leave, or disability leave. An Employee on an approved Leave of Absence under
subparagraph (d)(i) of this Section under the Family and Medical Leave Act of
1993 shall incur a Termination of Employment as of the last day of such Leave of
Absence.
2.58 Testing Compensation. The words "Testing Compensation" shall mean
remuneration used for testing purposes under this Plan. The words "Testing
Compensation" shall be interpreted according to their context and:
(a) when used to determine compliance with Section 415 of the Code
pursuant to Article 20 hereof, Testing Compensation shall mean all amounts
paid to a Participant as payment for services rendered by him to a
Participating Employer or any Related Employer which may be taken into
account for purposes of determining limitations on annual additions and
benefits under Section 415 of the Code; and
(b) when used to determine the identity of Highly Compensated
Employees, Testing Compensation shall mean Compensation adjusted to include
and exclude certain items of remuneration as required by Section 414(q) of
the Code, including adding salary reduction amounts which are excluded from
the taxable income of the Participant under Sections 125, 132(f)(4),
402(e)(3), 402(h) and 403(b) of the Code and adjusted to exclude
remuneration from a Related Employer which is not a Participating Employer
or Affiliate; and
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(c) when used to determine Top-Heavy status pursuant to Article 23
hereof, Testing Compensation shall mean Testing Compensation as defined in
(a) above, adjusted to exclude remuneration from a Related Employer which
is not a Participating Employer or an Affiliate.
2.59 Total and Permanent Disability. The works "Total and Permanent
Disability" shall mean a physical or mental condition of a Participant which
shall qualify such Participant to receive benefits under the long-term
disability program maintained by a Participating Employer. In the event a
Participant is not covered by a long-term disability program maintained by a
Participating Employer, such Participant shall be considered totally and
permanently disabled hereunder if the Participant has a physical or mental
condition resulting from bodily injury, disease, or mental disorder which
renders him incapable of continuing any gainful occupation and which condition
constitutes total disability under the federal Social Security Act.
2.60 Trading Limitation. The words "Trading Limitation" shall mean any
restriction with respect to any Shares under any federal or state securities
law, any regulation thereunder or an agreement affecting any Shares which would
make them not as freely tradable as Shares not subject to such restriction.
2.61 Transition Period. The words "Transition Period" shall mean the period
during which withdrawals, loans, distributions and changes in investment
direction cannot be processed due to the need to transfer and reconcile assets
and Account records as a result of the merger of the Profit Sharing Plan and the
Stock Bonus Plan with and into the Plan.
2.62 Trustee. The word "Trustee" shall mean the person or persons serving
as the Trustee of this Plan as of the Restatement Date and any successor Trustee
or Trustees.
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2.63 Trust Fund. The words "Trust Fund" shall mean the Trust established by
one or more Trust Agreements between the Company and the Trustee, including the
Investment Funds and the Invacare Segregated Stock Fund.
2.64 Unit. The word "Unit" shall mean an accounting unit representing an
interest in one of the Investment Funds established under Article 7 hereof.
2.65 Valuation Date. The words "Valuation Date" shall mean the date or
dates as of which Account balances are valued, which as of the Restatement Date
shall be each business day.
2.66 Vested Interest. The words "Vested Interest" shall mean, with respect
to any Participant, (a) plus (b) minus (c) below, where:
(a) equals the balances, if any, then credited to all Elective
Accounts, After-Tax Accounts, and Rollover Accounts maintained on his
behalf;
(b) equals the sum of (i) and (ii) and (iii):
(i) the balances, if any, then credited to his Matching
Contribution Account, his Employer Contribution Account, his Profit
Sharing Account and his Stock Bonus Account multiplied by his Vested
Percentage; plus
(ii) any distributions made to the Participant which have not
been recontributed by the Participant pursuant to Section 12.5 hereof;
plus
(iii) any withdrawals by the Participant from the Accounts
referenced in paragraph (i) above since his earliest Date of Hire
which has not been followed by a five (5) year Period of Severance,
multiplied by his Vested Percentage; and
(c) equals the amount of any distributions made to the Participant and
withdrawals by the Participant made from his Matching Contribution Account,
Employer Contribution Account, Profit Sharing Account and Stock Bonus
Account since his earliest Date of Hire which has not been followed by a
five (5) year Period of Severance.
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2.67 Vested Percentage. The words "Vested Percentage" shall mean for any
Participant a percentage determined on the basis of his number of years of
Service in accordance with the following table:
Years of Service Vested Percentage
---------------- -----------------
Less than 1 year 0%
1 but less than 2 years 20%
2 but less than 3 years 40%
3 but less than 4 years 60%
4 but less than 5 years 80%
5 or more years 100%
Notwithstanding the foregoing, a Participant's Vested Percentage shall be
one hundred percent (100%) if a Termination of Employment occurs as a result of
his death or Total and Permanent Disability.
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ARTICLE 3
PARTICIPATING EMPLOYERS
3.1 Designation of Participating Employers. An Affiliate of the Company
shall become a Participating Employer under this Plan by resolution of the Board
of Directors of the Company and the ratification of the Board of Directors of
the Affiliate. By becoming a Participating Employer under this Plan, an
Affiliate of the Company is deemed to approve this Plan in the form which is in
effect as of its Adoption Date. The Participating Employers as of the date of
execution of this Amendment and Restatement are as follows:
PARTICIPATING EMPLOYER TERMINATION DATE
Invacare Corporation
The name of a new Participating Employer shall be added to this Section upon its
becoming a Participating Employer. The Termination Date of a Participating
Employer which ceases to be a Participating Employer shall be added to this
Section.
3.2 Contributions of Participating Employers. Contributions made to the
Plan by a Participating Employer shall be allocated only among the Active
Employees of such Participating Employer.
3.3 Supplemental Agreements. The Company may, in the sole discretion of its
Board of Directors, determine that special provisions shall be applicable to
specific groups of Employees, former Employees or Beneficiaries of deceased
Employees, either in addition to, or in lieu of the provisions of this Plan, or
may determine that certain Employees of a Participating Employer shall not be
eligible to participate in this Plan. In such event, the Company shall adopt a
Supplemental Agreement with respect to such Employees, former Employees and
Beneficiaries of deceased Employees which shall specify the Employees, former
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Employees and Beneficiaries of deceased Employees covered by the Supplemental
Agreement and the special provisions applicable to such Employees, former
Employees and Beneficiaries of deceased Employees. Supplemental Agreements shall
be deemed to be a part of this Plan solely with respect to the Employees, former
Employees and Beneficiaries of deceased Employees specified therein.
3.4 Amendment or Termination of Supplemental Agreements. The Company may,
from time to time amend, modify or terminate a Supplemental Agreement pursuant
to Section 18.1 hereof provided, however, that no such action shall operate so
as to deprive any Participant, former Participant or Beneficiary who was covered
by such Supplemental Agreement of any vested rights to which he is entitled
under this Plan or the Supplemental Agreement.
3.5 Delegation of Authority. The Company is hereby fully empowered to act
on behalf of itself and the other Participating Employers as it may deem
appropriate in maintaining this Plan. Without limiting the generality of the
foregoing, such actions include obtaining and retaining tax qualified status for
this Plan and appointing attorneys-in-fact in pursuit thereof. Furthermore, the
adoption by the Company of any amendment to this Plan or the termination
thereof, will constitute and represent, without any further action on the part
of any Participating Employer, the approval, adoption, ratification or
confirmation by each Participating Employer of any such amendment or
termination. In addition, the appointment of or removal by the Company of any
Administrator, Trustee, Investment Manager or other person under this Plan shall
constitute and represent, without any further action on the part of any
Participating Employer, the appointment or removal by each Participating
Employer of such person or entity.
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3.6 Terminating Participation. A Participating Employer may terminate this
Plan with respect to Participants employed by said Participating Employer by an
instrument in writing executed on behalf of the Participating Employer and
delivered to the Company and the Trustee. The Trustee shall thereupon make
distributions of the Accounts of the Participants employed by said Participating
Employer in the manner provided in Section 18.2 of this Plan, or transfer such
Account balances to a successor plan, or continue to hold and administer such
Accounts until such time as an event occurs hereunder which would entitle any
such Participant to receive a distribution from the Plan, as directed by said
Participating Employer.
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ARTICLE 4
ELIGIBILITY AND PARTICIPATION
4.1 Prior Participants. Every Employee who was a Participant in this Plan
or the Stock Bonus Plan immediately prior to the Restatement Date shall continue
to be a Participant as of the Restatement Date. Each person on whose behalf
Account balances have been or will be transferred to the Trustee from the Stock
Bonus Plan as a result of the merger of the Stock Bonus Plan into this Plan
shall automatically become a Participant, terminated Participant, retired
Participant, Beneficiary or Alternate Payee, as the case may be, in this Plan,
effective as of the Restatement Date.
4.2 Eligibility Requirements. On and after the Restatement Date, every
other Employee who is a Covered Employee shall automatically become a
Participant in this Plan on the Enrollment Date coinciding with or next
following his Date of Hire.
4.3 Rehired Employees. In the event that a former Employee is rehired, he
shall become an Active Participant on the Enrollment Date coinciding with or
next following his date of reemployment if he is a Covered Employee on such
Enrollment Date.
4.4 Employees on Leave of Absence. A Covered Employee who would be eligible
to participate in this Plan, except that he is on an authorized unpaid Leave of
Absence on his Enrollment Date, shall be enrolled on the date on which he ceases
to be on the unpaid Leave of Absence, assuming he is then a Covered Employee.
4.5 Cessation of Covered Employee Status. In the event that a Participant
ceases to be a Covered Employee but continues in the employ of a Participating
Employer, he will continue to be a Participant in this Plan and accrue Service
until his date of Termination of Employment, but any distribution payable to
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such Participant under this Plan shall be computed on the basis of his Account
balances on the date he ceased to be a Covered Employee, plus any investment
gains or losses thereon.
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ARTICLE 5
SALARY DEFERRAL CONTRIBUTIONS
5.1 Election and Amount of Salary Deferral Contributions. Pursuant to
uniform rules and procedures prescribed by the Administrator, an Active
Participant may elect that a portion of his unpaid Compensation for a Plan Year
be paid by a Participating Employer to the Trustee hereunder as a Salary
Deferral Contribution and be treated as a contribution by the Participating
Employer. An Active Participant who does not elect to make Salary Deferral
Contributions pursuant to the preceding sentence shall be deemed to have elected
to contribute zero percent (0%). Any election by a Participant to contribute
more than zero percent (0%) of his unpaid Compensation pursuant to this Section
shall be expressed in one percent (1%) increments of his Compensation for a
payroll period. The Administrator may, from time to time, establish maximum
percentage limits on the amount of Salary Deferral Contributions that
Participants can make under this Plan and may establish maximum percentage
limits which apply solely to Highly Compensated Employees. As of the Restatement
Date and until changed by the Administrator pursuant to this Section, the
maximum percentage of an Active Participant's Compensation (minus any salary
reduction amounts which are excluded from the taxable income of the Participant
under Section 125 of the Code) for a payroll period that is subject to election
pursuant to this Section shall be fifteen percent (15%). Effective as of January
1, 2002, the maximum percentage of an Active Participant's Compensation (minus
any salary reduction amounts which are excluded from the taxable income of the
Participant under Section 125 of the Code) for a payroll period that is subject
to election pursuant to this Section shall be twenty-five percent (25%).
5.2 Election Procedures. A Participant's election pursuant to Section 5.1
hereof shall be made in such form (including writing, orally, telephonically or
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electronically) as is required by the Administrator, shall become effective at
such time as the Administrator shall permit and shall be conditioned upon:
(a) his right to defer the imposition of federal income tax on such
contributions until a subsequent distribution of such amount under this
Plan; and
(b) the Participating Employer's right to deduct such amounts for
federal income tax purposes after taking into account any contributions
made by the Participating Employer under any profit sharing, pension and
stock bonus plans maintained by the Company or the Participating Employer
which meet the requirements of Section 401(a) of the Code.
Any such election shall be deemed a continuing election and shall remain in
effect until it is revoked or amended by the Participant in writing, or by such
other procedures as shall be established by the Administrator from time to time,
or the Participant ceases to be an Active Participant. A Participant may revoke
or amend his election at such times as the Administrator shall permit. A
Participant shall revoke or amend his election by providing such notice to the
Administrator as the Administrator, in its sole discretion, shall require.
As of the Restatement Date and until changed by the Administrator pursuant
to this Section, a Participant will be able to revoke his election as of any
payroll payment date following his providing notice to the Administrator and may
amend his election daily in accordance with such procedures (including writing,
orally, telephonically or electronically) as shall be established by the
Administrator from time to time. In addition, as of the Restatement Date and
until changed by the Administrator pursuant to this Section, an Employee who is
a new Active Participant will be able to make an election pursuant to Section
5.1 hereof upon his Date of Hire or any date thereafter and such election shall
be implemented as soon as administratively practicable after such election is
received by the Administrator.
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5.3 Payment to Trustee and Crediting of Accounts. All amounts paid by a
Participating Employer to the Trustee pursuant to Section 5.1 hereof shall be
paid in cash not later than the date on which such amounts can reasonably be
segregated from the Participating Employer's general assets, which in no event
shall be later than the fifteenth (15th) business day of the month following the
month in which such amounts would have otherwise been payable to the
Participants in cash. Such amounts shall be credited to the Participants' Salary
Deferral Accounts.
5.4 Suspension and Limitation of Salary Deferral Contributions. In the
event a Participant receives a distribution from his Salary Deferral Account as
a result of hardship as described in Article 10 hereof, such Participant's
Salary Deferral Contributions shall be suspended for: (a) for Plan Years
beginning before January 1, 2002, a twelve (12) month period after his receipt
of such hardship distribution, and (b) for Plan Years beginning on or after
January 1, 2002, a six (6) month period after his receipt of a hardship
distribution. In addition, with respect to hardship distributions made prior to
January 1, 2002, for the taxable year of the Participant immediately following
the Participant's taxable year during which said hardship distribution occurs,
such Participant shall be barred from making Salary Deferral Contributions in
excess of (a) minus (b) below, where:
(a) equals Ten Thousand Five Hundred Dollars ($10,500.00) (plus any
cost of living increase after 2001 allowable under Section 402(g) of the
Code for such immediately following taxable year of the Participant); and
(b) equals the amount of such Participant's Salary Deferral
Contributions for the Participant's taxable year during which said hardship
distribution is made.
5.5 Catch-Up Contributions After Return From Military Service. In the event
that a Participant returns to employment with a Participating Employer or an
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Affiliate immediately following a leave of absence due to Military Service and
had failed to make Salary Deferral Contributions while on such leave of absence,
the Participant may elect to make catch-up Salary Deferral Contributions
relating to such period of Military Service, to the extent required by Section
414(u) of the Code. The period during which such Participant may make such
catch-up contributions shall commence on his date of rehire and shall continue
for a period which is the lesser of five (5) years following such date of rehire
or three (3) times the Participant's period of Military Service.
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ARTICLE 6
PARTICIPATING EMPLOYER CONTRIBUTIONS
6.1 Quarterly Employer Contributions. For each calendar year quarter ending
after the Restatement Date ("Allocation Dates"), the Participating Employers may
make employer profit sharing contributions to this Plan on behalf of each Active
Participant who has completed six (6) months of Service. For purposes of this
Section, an Active Participant shall be deemed to have completed six (6) months
of Service if he is in the employ of a Participating Employer at any time six
(6) months after his Date of Hire. The amount of the Participating Employer's
quarterly contributions, if any, shall be determined by the Company in its sole
discretion. Such contribution may be made on or prior to each such Allocation
Date as the Company shall determine in cash or Shares. An Employer's
contributions for any Allocation Date shall be credited to the Employer
Contribution Accounts of each Active Participant who:
(a) is employed on such Allocation Date; or
(b) is on a Leave of Absence under the Family Medical Leave Act of
1993 on such Allocation Date; or
(c) is not employed on such Allocation Date due to a retirement, Total
and Permanent Disability or death which occurred during the calendar year
quarter for which such contribution is made,
in same proportion that each such Participant's Compensation for the calendar
year quarter to which the contribution relates bears to the total Compensation
of all such Participants for such calendar year quarter.
6.2 Matching Contributions. For each payroll period ending after the
Restatement Date, the Participating Employers shall make matching contributions
to this Plan on behalf of each Active Participant who has completed six (6)
months of Service and on whose behalf Salary Deferral Contributions are made
with respect to such payroll period. Matching contributions made on behalf of an
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Active Participant with respect to a particular payroll period shall be made as
follows:
Salary Deferral Participating Employer
Contribution Percentage Matching Contribution Rate
Up to 1% of Compensation 100% of Salary Deferral Amount
2% to 3% of Compensation 50% of Salary Deferral Amount
No matching contributions will be made on deferrals in excess of three percent
(3%) of an Active Participant's Compensation.
Any matching contributions made on and after the Restatement Date shall be
in the form of cash and shall be credited to the Matching Contribution Accounts
of such Participants as of the date such contributions are received by the
Trustee.
6.3 Vesting of Participating Employer Contributions. Any Shares or amounts
credited to a Participant's Employer Contribution Account and Matching
Contribution Account pursuant to Sections 6.1 and 6.2 hereof shall be subject to
the vesting schedule set forth in Section 2.67 hereof.
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ARTICLE 7
TRUST FUNDS AND DIRECTION OF INVESTMENT
7.1 Investment Funds. The Trustee shall maintain such investment funds
within the Trust Fund as the Administrator may from time to time prescribe,
including but not limited to the following:
(a) money market funds;
(b) mutual funds;
(c) equity funds, including a fund holding qualified employer
securities;
(d) fixed income funds;
(e) balanced funds;
(f) any pooled investment fund established by a bank;
(g) any insurance company's general account;
(h) any special account established and maintained by any insurance
company; and
(i) guaranteed investment contracts, including pooled funds of
guaranteed investment contracts.
The Company shall have the sole discretion to determine the number of Investment
Funds to be maintained hereunder and the nature of the funds and may change or
eliminate the Investment Funds provided hereunder from time to time, except that
if individual direction of investments is permitted, the number of such funds
shall not be less than three (3), and of the funds selected, at least three (3)
shall be diversified and have materially different risk and return
characteristics, as determined by the Company.
Investment Funds maintained hereunder shall be held and administered in
accordance with the powers and duties set forth in a Trust Agreement.
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7.2 Invacare Segregated Stock Fund. Effective as of the Restatement Date,
the Trustee shall establish the Invacare Segregated Stock Fund, as described in
Section 2.28 hereof, within the Trust Fund, to hold those Shares received from
the Stock Bonus Plan.
7.3 Participant Direction of Investment. Each Participant, former
Participant or Beneficiary, by written direction to the Trustee or by such other
procedures as shall be established by the Administrator from time to time, shall
direct the investment of his Accounts (other than his Stock Bonus Account), and
contributions being made to any such Accounts in the Investment Funds
established hereunder; provided, however, that any such investment directions
shall be made in accordance with such other rules as are established by the
Administrator from time to time in its sole discretion, including rules
requiring that investment selections be made in percentage increments. Any
investment direction with respect to contributions being made to any such
Accounts of a Participant shall be deemed a continuing direction and shall
remain in effect unless revoked or changed by the Participant, former
Participant or Beneficiary. A Participant, former Participant or Beneficiary may
change his investment direction at such times and upon such notice as the
Administrator, from time to time, may designate; provided, however, that
directions shall be permitted to be made or changed at least once in each three
(3) month period. Each Participant, former Participant or Beneficiary shall
indicate whether any change in investment direction shall apply only to
contributions made to this Plan following such change or whether such change
shall also operate to change the investment of Units of any Investment Fund
already credited to his Accounts. If a procedure for daily change of investment
is offered by the Administrator, such investment direction may be changed on a
daily basis, such change generally to be effective as of the end of the day of
the change, subject to reasonable administrative delays. Any rules established
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by the Administrator pursuant to this Section shall apply to all Participants,
former Participants and Beneficiaries in a uniform and nondiscriminatory manner.
It is intended that the total Account balances of all Salary Deferral Accounts,
Matching Contribution Accounts, After-Tax Accounts, Profit Sharing Accounts,
Employer Contribution Accounts, and Rollover Accounts, as well as the amounts
other than Shares and cash for fractional Shares credited to Stock Bonus
Accounts be invested in the Investment Funds established hereunder. In the event
that a Participant, former Participant or Beneficiary does not direct the
investment of any portion of such Account balances, such undirected portion of
such Account balances shall be invested in a managed income portfolio. Other
than as expressly provided in this Plan, no directions of investment with
respect to Shares credited to Participants' Stock Bonus Accounts shall be made
pursuant to this Article 7.
7.4 Diversification of Stock Bonus Account. Each Qualified Participant, by
written direction to the Administrator or by such other procedures as shall be
established by the Administrator from time to time, may direct the investment of
his total Stock Bonus Account in any or all of the Investment Funds established
hereunder; provided, however, that any such investment directions shall be made
in accordance with such other rules as are established by the Administrator from
time to time in its sole discretion, including rules requiring that investment
selections be made effective as of specific investment dates and within a
certain period of time prior to an investment date. Any rules established by the
Administrator pursuant to this Article 7 relating to Participant direction of
investment shall apply to all Qualified Participants in a uniform and
nondiscriminatory manner following such Qualified Participant's election to
direct the investment of his Stock Bonus Account. Each Plan Year, each Active
Participant who is not a Qualified Participant may direct the investment of up
to the greater of: (i) ten percent (10%) of the number of Shares credited to his
Stock Bonus Account as of the last day of the immediately preceding Plan Year;
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and (ii) Shares having a Fair Market Value of One Hundred Dollars ($100.00) or
less. It is intended that any remaining Shares continue to be fully invested in
the Invacare Segregated Stock Fund.
7.5 Valuation of Investment Funds. The interest of any Account in an
Investment Fund shall be measured in terms of Units which shall be equal,
undivided interests in the assets of the Investment Fund. The initial value of a
Unit of an Investment Fund shall be such uniform amount of money or uniform
value as determined by the Trustee. The value of a Unit in an Investment Fund
shall be redetermined daily by the Trustee by dividing the fair market value of
the Investment Fund (including any uninvested cash) as of the next preceding
business day by the total number of Units of such Investment Fund then credited
to the Accounts of Participants, former Participants and Beneficiaries who are
then invested in the Investment Fund. Fractional Units of the Investment Funds
shall be credited to an Account to at least two (2) decimal places. It is
intended that this Section operate to adjust each Investment Fund to reflect all
income attributable to such Investment Fund and changes in the value of such
Investment Fund's assets, as the case may be, as of any Valuation Date and, as a
result of the adjustment of Unit values, to distribute among all Accounts and
subaccounts having an interest in such Investment Fund, all such income and
value changes.
7.6 Valuation and Adjustment of Invacare Segregated Stock Fund. The
interest of any Stock Bonus Account in the Invacare Segregated Stock Fund shall
be measured in terms of whole Shares and an amount of cash for the value of a
fractional Share. The number of whole Shares, together with the cash value of a
fractional Share, credited to each Stock Bonus Account shall be redetermined
daily by the Trustee. The cash value of a fractional Share shall be determined
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with reference to the Fair Market Value of a Share as of the next preceding
business day. The Invacare Segregated Stock Fund shall consist of the Shares and
cash (representing the value of a fractional Share) credited to all Stock Bonus
Accounts. The Trustee may in its discretion, maintain within the Invacare
Segregated Stock Fund a cash reserve which is deemed sufficient to make
anticipated cash distributions to Participants entitled to receive a
distribution from the Plan.
In the event of a Share Adjustment or dividend payment, the Trustee shall
credit each Stock Bonus Account, as of the date of such Share Adjustment or
dividend payment, with that portion of the Share Adjustment which bears the same
relationship to the Share Adjustment or dividend payment as the number of Shares
credited to such Stock Bonus Account on said date bears to the total Shares then
credited to all Stock Bonus Accounts.
7.7 Debiting and Crediting of Accounts. If a Participant, former
Participant or Beneficiary has made a proper change of investment direction
pursuant to Section 7.3 hereof with respect to Units of any Investment Fund
credited to his Accounts, other than his Stock Bonus Account, his Accounts shall
be debited by the number of Units of any such Investment Fund which have been
sold and credited with the number of Units of any such Investment Fund which
have been purchased in order to accomplish such change of investment. In
addition, if a Qualified Participant or eligible Active Participant has made a
proper change of investment direction pursuant to Section 7.4 hereof with
respect to Shares credited to his Stock Bonus Account, his Stock Bonus Account
shall be debited by the number of Shares which have been sold and his Stock
Bonus Account shall be credited with the number of Units of any such Investment
Fund which have been purchased in order to accomplish such change of investment.
7.8 Transferred Assets. All assets which are transferred from the Stock
Bonus Plan to Accounts hereunder as a result of the merger of the Stock Bonus
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Plan into this Plan shall be credited to the appropriate Investment Funds and
the Invacare Segregated Stock Fund maintained under this Plan effective as of
the Restatement Date.
7.9 ERISA Section 404(c) and Related Restrictions on Investment Directions.
The investment direction procedures of this Article are and shall continue to be
designed so as to comply, in the sole judgment of the Administrator, with the
requirements imposed by Section 404(c) of ERISA and regulations thereunder, and
shall apply to all Participants, former Participants and Beneficiaries in a
uniform and nondiscriminatory manner. Notwithstanding anything to the contrary
in this Article, the Trustee may decline to follow any investment direction
which, if implemented:
(a) would not be in accordance with the Plan documents;
(b) would cause the indicia of ownership of Plan or Trust assets to be
maintained outside the jurisdiction of the United States District Courts;
(c) would jeopardize the Plan's or the Trust's tax-qualified status;
(d) could result in a loss in excess of the balance of the
Participant's, former Participant's, or Beneficiary's Accounts;
(e) would cause this Plan or the Trust to engage in:
(i) a sale or exchange with a Participating Employer (except as
with respect to certain qualifying employer securities as defined in
Section 407(d)(5) of ERISA which meet the requirements of Section
408(e) of ERISA and 29 CFR ss.2550.404c-1(d)(2)(ii)(E)(4));
(ii) a lease between this Plan or the Trust and a Participating
Employer or a loan to a Participating Employer;
(iii) acquisition or sale of real property of a Participating
Employer; or
(iv) acquisition or sale of securities of a Participating
Employer other than certain qualifying employer securities as defined
in Section 407(d)(5) of ERISA which meet the requirements of Section
408(e) of ERISA and 29 CFR ss.2550.404c-1(d)(2)(ii)(E)(4);
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(f) would result in a prohibited transaction within the meaning of
Section 4975 of the Code or Section 406 of ERISA; or
(g) would generate income taxable to this Plan or to the Trust.
To the extent that Section 404(c) of ERISA is not applicable or the terms
thereof are not satisfied, the Participants and Beneficiaries shall constitute
named fiduciaries under ERISA with respect to their authority to direct
investment of their Accounts.
7.10 Restrictions on Insider Trading. Notwithstanding the foregoing
provisions of this Article 7, the Administrator in its sole discretion, shall
have the authority to place such restrictions upon the investment directions of
any person who is subject to Section 16(b) of the Securities Exchange Act of
1934 as amended ("Insider") as shall be appropriate to comply with such Section.
Such restrictions shall include, but shall not be limited to the following:
Insiders shall be permitted to submit investment directions relating to the
Invacare Stock Fund only on a "semi-annual date" which is no less than six (6)
months after the date of the most recent investment direction received from such
Insider relating to the Invacare Stock Fund. For purposes of this Section 7.10,
the term "semi-annual date" shall mean a date which is within the period that
begins the third business day following the date on which the Company's first
fiscal quarter and third fiscal quarter summary statements of sales and earnings
shall be released and which ends on the twelfth business day following such
release date.
In addition, an Insider who receives a distribution of Shares as part of a
hardship withdrawal pursuant to Section 10.4 shall be prohibited from directing
the investment of his Accounts into or out of the Invacare Stock Fund for the
six (6) month period following the date of such hardship withdrawal.
7.11 Restrictions During Transition Period. No changes in or revocations of
investment directions, including reallocations between the Investment Funds and
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diversification elections pursuant to Section 7.4 hereof, shall be accepted by
the Administrator from existing Participants, former Participants and
Beneficiaries during the Transition Period.
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ARTICLE 8
ACCOUNTS
8.1 Accounts as of Restatement Date. Accounts and subaccounts being
maintained under this Plan and the Stock Bonus Plan immediately prior to the
Restatement Date shall be reclassified as a result of the merger of the Stock
Bonus Plan into this Plan as of the Restatement Date. Such accounts and
subaccounts shall be categorized, as of the Restatement Date, as follows:
(a) except as specifically provided in this Section 8.1, if such an
account or subaccount had been credited with a Participant's Elective
Contributions and earnings thereon under the Plan prior to the Restatement
Date, such account shall be deemed to be a Salary Deferral Account;
(b) if such an account or subaccount was classified as a Matching
Contribution Account under the Plan prior to the Restatement Date, such
account shall be deemed to be a Matching Contribution Account;
(c) If such account or subaccount was credited with employer
discretionary profit sharing contributions and earnings thereon, under this
Plan prior to the Restatement Date, such account shall be deemed to be a
Profit Sharing Account;
(d) if such an account or subaccount was classified as an Employer
Contribution Account under the Stock Bonus Plan prior to the Restatement
Date, such account shall be deemed to be a Stock Bonus Account;
(e) if such account or subaccount is credited with Participating
Employer Contributions and earnings thereon on and after the Restatement
Date, such account shall be deemed to be an Employer Contribution Account;
(f) if such an account or subaccount had been credited with a
Participant's voluntary after-tax contributions and earnings thereon under
the Plan prior to the Restatement Date, such account shall be deemed to be
an After-Tax Account; and
(g) if such an account or subaccount had been credited with a
Participant's or former Participant's rollover contributions and earnings
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thereon under the Plan or the Stock Bonus Plan prior to the Restatement
Date, such account shall be deemed to be a Rollover Account.
8.2 Establishment of Accounts. Upon an Employee becoming a Participant, the
Administrator shall establish a Salary Deferral Account, a Matching Contribution
Account and an Employer Contribution Account in the name of such Participant.
Salary Deferral, Matching Contribution and Employer Contribution Accounts
established on behalf of a new Participant shall be deemed to have been
established on the date upon which or as of which such individual became a
Participant.
8.3 Crediting and Debiting of Accounts. The Accounts of Participants shall
be credited with contributions as specified in Articles 5 and 6 hereof and in
Section 23.3 hereof and shall be debited to take into account any withdrawals or
distributions made from such Accounts pursuant to Article 9, 10, or 15 hereof.
All such credits and debits to the Accounts of a Participant shall be made as of
the dates specified in the appropriate Sections of this Plan.
8.4 Investment Fund Subaccounts. In the event a Participant directs,
pursuant to Article 7 hereof, that his Account or Accounts are to be invested in
more than one (1) Investment Fund, the Administrator shall maintain subaccounts
as a part of such Participant's Account or Accounts. Such subaccounts shall show
the portion of an Account invested in a particular Investment Fund.
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ARTICLE 9
WITHDRAWALS FROM ACCOUNTS
9.1 Restrictions on Withdrawals. A Participant may not withdraw his Account
balances prior to his Termination of Employment except as provided in this
Article 9, in Article 10 and in Article 13 hereof. Withdrawals made pursuant to
this Article shall be subject to the following restrictions:
(a) the minimum amount of any such withdrawal shall be the lesser of
an amount set by the Administrator or the total of the Account balances
which are available for withdrawal pursuant to this Article;
(b) the withdrawing Participant shall make an application for
withdrawal or shall follow such procedures as shall be specified by the
Administrator from time to time;
(c) any withdrawal shall be made in a single lump sum payment of cash
in accordance with Article 15 hereof;
(d) any withdrawal shall be made in accordance with the provisions of
Section 15.11 hereof;
(e) no amounts withdrawn pursuant to this Article may be recontributed
to this Plan; and
(f) any withdrawal shall be subject to such other reasonable and
uniform rules and regulations, consistently applied, as may be established
from time to time by the Administrator.
9.2 Withdrawals from After-Tax Account. Subject to Section 9.1 hereof, a
Participant may withdraw all or a portion of his After-Tax Account balance at
any time and for any reason.
9.3 Withdrawals After Age 59-1/2. Subject to Section 9.1 hereof, on or
after the date a Participant attains age fifty-nine and one-half (59-1/2), such
Participant may withdraw all or a portion of his Accounts under the Plan. Any
such withdrawals shall be made from Accounts on a pro-rata basis.
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Prior to the date on which a Participant attains age fifty-nine and
one-half (59-1/2), such Participant may withdraw from his Salary Deferral
Account only in the case of hardship as provided in Article 10 hereof.
9.4 Withdrawals by Qualified Participants. Subject to Section 9.1 hereof, a
Qualified Participant may withdraw all or a portion of his vested Stock Bonus
Account balance which is invested in Shares within the Invacare Segregated Stock
Fund.
9.5 Termination of Withdrawal Rights. Upon an attempt by a Participant to
use his interest in this Plan as security for any type of obligation, or to
alienate, dispose of or in any manner encumber, or upon an attempt by any third
person to attach, levy upon or in any manner convert the use or enjoyment of any
such interest of a Participant, the right to withdraw any portion thereof
pursuant to this Article shall automatically terminate.
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ARTICLE 10
HARDSHIP DISTRIBUTIONS
10.1 Application for Hardship Distribution. Subject to such uniform rules
and procedures as the Administrator may prescribe, in the case of hardship, an
Employee who is an Active Participant may apply to the Administrator for a
hardship distribution from his Salary Deferral Account prior to his retirement
or Termination of Employment. For the purposes of this Section, a distribution
shall be on account of hardship only if the distribution is made on account of
an immediate and heavy financial need of the Participant, as described in
Section 10.2 hereof, and is necessary, as described in Section 10.3 hereof, to
satisfy such need. Such distribution may be made only from the Accounts
specified in Section 10.4 hereof.
10.2 Immediate and Heavy Financial Need. A distribution will be made on
account of an immediate and heavy financial need of a Participant only if the
distribution is on account of:
(a) the need to prevent the eviction of the Participant from his
principal residence or foreclosure on the mortgage of the Participant's
principal residence;
(b) purchase (excluding mortgage payments) of a principal residence
for the Participant;
(c) medical expenses described in Section 213(d) of the Code incurred
by the Participant, the Participant's spouse, or any dependents of the
Participant (as defined in Section 152 of the Code);
(d) payment of unreimbursable tuition, related educational fees and
room and board for up to the next twelve (12) months of post-secondary
education for the Participant, his or her spouse, children or dependents;
or
(e) any other circumstance specifically permitted under Code Section
401(k)(2)(B)(i)(IV).
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10.3 Determination of An Amount Necessary to Satisfy an Immediate and Heavy
Financial Need. A distribution will be deemed to be necessary to satisfy an
immediate and heavy financial need of a Participant only if all of the following
requirements are satisfied:
(a) the distribution is not in excess of the amount of the immediate
and heavy financial need of the Participant, including any amounts
necessary to pay any federal, state or local income taxes or penalties
reasonably anticipated to result from such distribution;
(b) the Participant has obtained all distributions, other than
hardship distributions, and all nontaxable (at the time of the loan) loans
currently available under this Plan and all other plans maintained by the
Participating Employers and any Affiliates, unless such distribution or
loan would have the effect of increasing the amount of the financial need;
(c) for hardship distributions made prior to January 1, 2002, this
Plan and all other plans maintained by the Participating Employers and any
Affiliates provide that the Participant may not make Salary Deferral
Contributions for the Participant's taxable year immediately following the
taxable year of the Participant during which said hardship distribution
occurs in excess of the applicable limit under Section 402(g) of the Code
for such next taxable year of the Participant less the amount of such
Participant's Salary Deferral Contributions for the taxable year of the
Participant during which said hardship distribution occurs; and
(d) the Participant is prohibited under the terms of this Plan and all
other plans maintained by the Participating Employers and any Affiliates
(or other legally enforceable agreement), from making Salary Deferral
Contributions and voluntary after-tax contributions, if applicable, to this
Plan and such other plans for: (a) for Plan Years beginning before January
1, 2002, a twelve (12) month period after his receipt of such hardship
distribution; and (b) for Plan Years beginning on or after January 1, 2002,
a six (6) month period after his receipt of such hardship distribution.
By virtue of this Section and Section 5.4 hereof, this Plan provides for the
restrictions contained above in subparagraphs (c) and (d).
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10.4 Permitted Distributions. If the Administrator determines that the
criteria set forth in Sections 10.2 and 10.3 hereof have been satisfied with
respect to a Participant, it may order a distribution of the lesser of:
(a) his Salary Deferral Account balance; and
(b) the sum of the aggregate amount of the contributions made to his
Salary Deferral Account, plus earnings thereon, if any, credited prior to
January 1, 1989.
No distributions shall be made from a Participant's Accounts, other than his
Salary Deferral Account, pursuant to this Article.
Such distribution shall be made in a cash lump sum and shall be made in
accordance with the provisions of Section 15.11 hereof. Any distribution from a
Participant's Accounts under this Article shall be deemed to be made in the
order set forth above.
If the Administrator directs that a distribution be made hereunder, it may
thereafter, if it determines that such hardship no longer exists or is no longer
imminent or upon agreement with the Participant, direct that any such
distribution not yet made not be made.
10.5 Administration of Hardship Provisions. Neither the application for nor
payment of any distribution in accordance with this Article shall have the
effect of terminating a Participant's participation in this Plan. The
Administrator may prescribe the use of such forms, conduct such investigation,
and require the making of such representations and warranties, as it deems
desirable to carry out the purpose of this Article.
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ARTICLE 11
PARTICIPANT LOANS
11.1 Loan Application. An Employee who is an Active Participant or a person
who is a Party in Interest ("Borrower") may request a loan from the Plan. If the
Borrower (and the proposed loan) satisfy the requirements set forth herein, the
Trustee shall make a loan to such Borrower pro rata from his Accounts hereunder,
other than his Employer Contribution Account and his Stock Bonus Account. No
Borrower shall be permitted to borrow from his Employer Contribution and Stock
Bonus Accounts.
In the event an Employee shall request a loan from the Plan, such Employee
shall receive an immediate distribution of his After-Tax Account.
11.2 Amount of Loan. The amount of any such loan shall be determined by the
Administrator; provided, however, that any such loan shall not, when combined
with outstanding loans previously made from this Plan and outstanding loans made
under other qualified retirement plans, if any, maintained by the Company or any
Affiliate, cause the aggregate amount of all such loans to such Borrower to
exceed the lesser of (a) or (b) below, where:
(a) equals one-half (1/2) of all vested amounts held in such
Borrower's Accounts under this Plan other than his Employer Contribution
and Stock Bonus Accounts; and
(b) equals Fifty Thousand Dollars ($50,000.00) reduced by the
remainder, if any, of:
(i) the highest outstanding balance of loans to such Borrower
from this Plan and all other qualified retirement plans maintained by
a Participating Employer or any Affiliate during the twelve (12) month
period preceding the date on which the loan is to be made; minus
(ii) the outstanding balance of loans to such Borrower from the
plans on the day the loan is to be made.
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11.3 Loan Administration. The following additional provisions shall be
applicable to the loans under this Plan:
(a) Loan Program Administration. The loan program under the Plan shall
be administered by the Administrator in accordance with the provisions of
this Article and such additional or other procedures as the Administrator
may from time to time adopt.
(b) Loan Application Procedure. A Borrower shall apply for a loan in
such manner (including in writing, orally, telephonically, or
electronically) as the Administrator may determine.
(c) Basis for Approval or Denial of Loans. Loans will be approved only
if:
(i) the Borrower does not currently have an outstanding loan from
the Plan;
(ii) the Administrator believes the Borrower intends and is able
to repay the loan in accordance with its terms;
(iii) the amount of such loan shall not be in excess of the
amount which is credited to the Borrower's Accounts, other than his
Employer Contribution Account and his Stock Bonus Account, at the time
of such loan and shall be made exclusively from such Accounts;
(iv) the amount of such loan shall not be less than One Thousand
Dollars ($1,000.00);
(v) it is anticipated that repayment of the loan shall be made by
payroll deduction by the Participating Employer employing the Borrower
or any other Affiliate employing him; and
(vi) the loan satisfies the requirements of Section 11.4 of the
Plan.
11.4 Terms and Conditions of Loans. Any loan made pursuant to this Article
shall be considered an investment of the Account or Accounts of the Borrower and
shall be subject to the following terms and conditions:
(a) Interest. Interest shall be charged at a reasonable rate,
comparable to the rate charged by a commercial lender for a similar loan.
Unless otherwise determined by the Administrator, the interest rate shall
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be equal to one percentage point above the prime rate as it appears in The
Wall Street Journal in effect on the last business day of the calendar
quarter prior to the calendar quarter in which the loan is made.
(b) Loan Term and Repayment Schedule. The term of any loan shall be
arrived at by mutual agreement between the Borrower and the Administrator
but shall not be less than one (1) year and shall not exceed five (5)
years; provided, however, that if the proceeds of such loan are to be used
to acquire any dwelling which within a reasonable time is to be used as the
Borrower's principal residence, such loan may be for a term of up to
fifteen (15) years. Subject to the conditions set forth in the immediately
preceding sentence, the terms of the loan shall extend for any number of
whole months as so agreed by the Borrower and the Administrator. All loans
shall provide for the substantially level amortization of the loan, with
payments no less frequently than quarterly, over the term of the loan;
provided, however, that the loan shall permit (unless the Administrator
otherwise determines) a grace period for up to one (1) year from such
repayments while a Borrower is on a leave of absence without pay, provided
that such grace period shall not extend the due date of the loan beyond the
maximum time period set forth above.
If a Borrower is on a military leave, loan repayments will be suspended
under this Plan, as permitted under Section 414(u)(4) of the Code.
The Administrator may make such additional, nondiscriminatory rules
regarding loan repayments as it deems necessary, including early repayments
and any restrictions relating thereto.
(c) Segregation of Accounts. A Borrower's Accounts, to the extent of
such borrowing, shall be deemed segregated for investment purposes. Both
the note representing such loan and the Accounts of the Borrower, to the
extent of such borrowing, shall not be taken into account in the valuation
of the Plan pursuant to Article 8 hereof.
(d) Repayment Procedures. Except for early repayments of the
outstanding balance, (i) repayment of any loan made to an Active Employee
shall be by payroll deduction, (ii) repayment of any loan made to an Active
Employee who has a Termination of Employment and is eligible for severance
payments shall be by payroll deduction from said severance payments, and
(iii) repayment of any loan made to a person who is no longer an Active
Employee and is not eligible for severance payments shall be made as
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determined by the Administrator and communicated to such Borrower.
Repayments of any loan shall be credited to the Accounts of the Borrower
prorata. Loan repayments shall be directed back into the active Investment
Fund based upon the Participant's future contribution election percentages.
(e) Documentation and Collateral. Each Borrower shall indicate his
acceptance of the terms of the loan in such manner as the Administrator
shall determine. Without limiting the foregoing sentence, executing on,
endorsing, or depositing the check representing the loan proceeds shall
automatically constitute acceptance of the terms of the loan and evidence
the Borrower's obligation to repay the loan in accordance with its terms.
Each loan shall bear interest payable to the order of the Trustee and shall
be supported by adequate collateral. Such collateral shall consist of an
amount not to exceed fifty percent (50%) of the Borrower's entire right,
title, and interest in and to the Trust Fund, and any earnings attributable
to such amounts. The Administrator may require such other and further
documentation as it deems appropriate. Unless the Administrator otherwise
determines, spousal consent to a loan or granting of collateral shall not
be required unless the Borrower has previously elected to receive
distribution of his benefits in the form of an annuity.
(f) Default. A Borrower shall be in default (i) if he fails to make
any payment of principal or interest sufficient to meet the substantially
level quarterly amortization requirement in paragraph (b) above, (ii) if he
fails to make a required payment after a permitted one (1) year grace
period as provided for in paragraph (b) above, or (iii) if his collateral
becomes inadequate to secure the loan and he does not provide substitute
collateral satisfactory to the Administrator within ten (10) days after a
request therefor by the Administrator or if he fails to repay in full the
entire outstanding balance of the principal and interest accrued on such
loan within sixty (60) days after his Termination of Employment, unless he
remains a Party in Interest or receives severance payments from a
Participating Employer after such Termination of Employment. If a
terminated Participant receives severance payments from a Participating
Employer following his Termination of Employment, he shall be in default if
he fails to repay in full the entire outstanding balance of the principal
and interest accrued on such loan by the earlier of the date on which the
Borrower receives a distribution of his Accounts from the Plan or sixty
(60) days after his severance payments from the Participating Employer
cease. In the event of default by a Borrower, his loan shall be
accelerated, and:
(i) if his collateral security in this Plan is adequate to cover
all or part of the outstanding principal and interest, and if
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distribution of such amount would not, in the opinion of the
Administrator, put at risk the tax qualified status of the Plan or the
Salary Deferral Contribution portion thereof, the Trustee shall take
such steps as it deems appropriate to offset the loan balance against
his Vested Interest or otherwise execute upon such Plan collateral;
and
(ii) if his collateral security described in paragraph (f)(1) is
not adequate to cover all of the outstanding principal and interest,
or if execution upon such collateral would, in the opinion of the
Administrator, put at risk the tax qualified status of the Plan or the
Salary Deferral Contribution portion thereof, the Trustee shall
commence appropriate collection actions against the Borrower to
recover the amounts owed.
Expenses of collection, including legal fees, if any, of any loan in
default shall be borne by the Borrower or his Accounts.
(g) Loan Origination and Maintenance Fee. The Administrator may charge
to the Account of each Borrower a loan origination fee. The Administrator
may adjust such charge from time to time to reflect the actual cost
incurred in processing loans, and such fees shall be assessed to the
Accounts of all Borrowers in a nondiscriminatory manner. Annual maintenance
fees shall also be charged to the Account of each Borrower. All loan fees
shall be used by the Administrator to pay administrative expenses of the
Plan incurred in connection with such loans.
11.5 Terms of Prior Loans May Not Be Renegotiated or Extended.
Notwithstanding the foregoing provisions of this Article, the terms of
outstanding loans may not be renegotiated and in the event the proceeds of any
loan made hereunder shall be used directly or indirectly to pay off any
obligations under a prior loan made hereunder, the term of the more recent loan
shall not extend beyond the period of repayment under the prior loan. For
purposes of this Section, the Administrator shall be able to rely on a
certification by the Participant or former Participant as to the use of the new
loan's proceeds.
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ARTICLE 12
TERMINATION OF EMPLOYMENT
12.1 Vested Interest Distributable. In the event of the Termination of
Employment of a Participant for any reason other than death, Total and Permanent
Disability, or retirement, he shall be entitled to receive a distribution of his
Vested Interest.
12.2 Commencement of Distribution. The Vested Interest of a terminated
Participant shall be distributed to him in accordance with the rules and
procedures set forth in Article 15 hereof. Except as otherwise provided in
Article 15 hereof, such distribution shall be made or shall commence to be made
on such date on or after his date of Termination of Employment as shall be
directed by the terminated Participant in his sole discretion; provided,
however, that such distribution need not be made earlier than administratively
practicable. Notwithstanding anything contained in this Plan to the contrary,
other than Section 15.7 hereof, if a Participant has a Termination of Employment
pursuant to Section 2.57(f) hereof that does not meet the requirements of
Section 401(k)(10) of the Code, such Participant shall not be eligible to
receive a distribution from his Salary Deferral Account under this Plan until he
terminates employment with the person, entity or joint venture acquiring the
business unit or facility with which he was employed.
12.3 Forfeitures. If a terminated Participant's Vested Percentage is one
hundred percent (100%) on his date of Termination of Employment, his Matching
Contribution Account, Profit Sharing Account, Employer Contribution Account, and
Stock Bonus Account shall thereafter be held, administered and distributed in
accordance with Articles 8 and 15 hereof. If his Vested Percentage is greater
than zero (0) but less than one hundred percent (100%), his Matching
Contribution, Profit Sharing, Employer Contribution, and Stock Bonus Accounts
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shall continue to be administered in accordance with the provisions of Articles
8 and 15 hereof until the earliest to occur of any of the following events:
(a) he receives a distribution of his entire Vested Interest;
(b) he has a five (5) year Period of Severance;
(c) he dies; or
(d) he is rehired by a Participating Employer or an Affiliate.
If the earliest to occur of said events is either the date of complete
distribution of his Vested Interest, or his having had a five (5) year Period of
Severance, or his death, the excess of:
(i) his Account balances; over
(ii) his Vested Interest;
shall be forfeited as of such date and shall be debited to his Matching
Contribution Account, Profit Sharing Account, Employer Contribution Account, and
Stock Bonus Account, respectively. The balances remaining credited to his
Matching Contribution Account, Profit Sharing Account, Employer Contribution
Account, and Stock Bonus Account after said forfeiture shall thereafter be held,
administered and distributed in accordance with Articles 8 and 15 hereof. If a
Participant terminates employment at a time when his Vested Percentage is zero
(0), such terminated Participant shall be deemed to have received a lump sum
distribution from his Matching Contribution Account, Profit Sharing Account,
Employer Contribution Account, and his Stock Bonus Account in such zero (0)
amount in full discharge of this Plan's liability with respect to such Accounts
and his Matching Contribution, Profit Sharing, Employer Contribution, and Stock
Bonus Account balances, if any, shall be forfeited pursuant to this Section.
Such distribution and forfeiture shall be deemed to have occurred on the date of
Termination of Employment of such Participant.
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If the earliest of said events shall be the terminated Participant's rehire
by a Participating Employer or an Affiliate, this Article shall not apply to him
until a subsequent Termination of Employment described in Section 12.1 hereof.
12.4 Use of Forfeitures. Any forfeitures pursuant to Section 12.3 hereof
which remain after recrediting of prior forfeitures pursuant to Section 12.5
hereof shall be used in one of the following manners, as directed by the Company
in its sole discretion:
(a) to pay any expense incurred in connection with the administration
of the Plan; or
(b) to reduce future Participating Employer contributions under
Sections 6.1 and 6.2 hereof.
12.5 Recrediting Accounts of Rehired Participants. If a terminated
Participant in this Plan or the Stock Bonus Plan shall be rehired by a
Participating Employer or any Affiliate, he shall immediately be reinstated as a
Participant in this Plan for purposes of this Section. If a terminated
Participant shall be rehired by a Participating Employer or any Affiliate at a
time when his Period of Severance is five (5) or more years, no portion of his
Matching Contribution Account balance, Profit Sharing Account balance, Employer
Contribution Account balance, or Stock Bonus Account balance under this Plan or
the Stock Bonus Plan which was forfeited and debited pursuant to the provision
of this Plan or any provisions of the Stock Bonus Plan shall be recredited to
his Matching Contribution Account, Profit Sharing Account, Employer Contribution
Account, and Stock Bonus Account. If a terminated Participant shall be rehired
by a Participating Employer or any Affiliate at a time when his Period of
Severance is less than five (5) years, the portion of his Matching Contribution
Account balance, Profit Sharing Account balance, Employer Contribution Account
balance or Stock Bonus Account balance under this Plan or the Stock Bonus Plan
which was forfeited and debited pursuant to the provisions of this Plan or the
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Stock Bonus Plan shall be recredited to his Matching Contribution Account,
Profit Sharing Account, Employer Contribution Account, and Stock Bonus Account.
In order to balance the Accounts maintained under this Plan, after giving
effect to the recrediting of prior forfeitures and/or earnings as provided above
to a rehired Participant's Matching Contribution Account, Profit Sharing
Account, Employer Contribution Account and Stock Bonus Account, the
Administrator shall use any forfeitures which would otherwise be used to reduce
the Participating Employer contributions in accordance with Section 12.4 hereof.
To the extent that the current forfeited Shares and other forfeited cash amounts
for any Plan Year are less than the aggregate previously forfeited Shares and
other amounts which were recredited during the Plan Year to the Matching
Contribution Accounts, Profit Sharing Account, Employer Contribution Account,
and Stock Bonus Account of Participants who were entitled to restoration during
the Plan Year, the Participating Employer which rehires the Participant shall
contribute to this Plan the difference between the aggregate previously
forfeited Shares or amounts which were recredited during the Plan Year to the
Matching Contribution Accounts, Profit Sharing Account, Employer Contribution
Account, and Stock Bonus Account of Participants who were entitled to
restoration and the current forfeited Shares and amounts. The Participating
Employers, at their option, may also contribute the aggregate previously
forfeited Shares or other amounts which were recredited during the Plan Year to
the Matching Contribution Accounts, Profit Sharing Account, Employer
Contribution Account, and Stock Bonus Account of Participants. Such contribution
shall be made by the Participating Employers no later than the due date
(including extensions) of the tax return for the Taxable Year which includes the
last day of the Plan Year during which the Shares and other amounts were
restored. For purposes of the limitations contained in Article 20 hereof, such
contribution shall not be deemed to have been contributed at the time it is
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recontributed pursuant to this Section, but shall be deemed to have been
contributed at the time of the original contribution.
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ARTICLE 13
RETIREMENT AND DISABILITY BENEFITS
13.1 Normal Retirement. The Matching Contribution Account, Profit Sharing
Account, Employer Contribution Account, and Stock Bonus Account of a Participant
who works for a Participating Employer or an Affiliate until he attains his
Normal Retirement Date shall be fully vested and nonforfeitable. A Participant
who retires from the employ of a Participating Employer or an Affiliate on his
Normal Retirement Date shall be entitled to receive a distribution of his total
Account balances. Subject to Section 15.1 hereof, such distribution shall be
made or shall commence to be made on such date on or after the Participant's
retirement as the Participant shall elect. Such distribution shall be made in
accordance with the provisions of Article 15 hereof.
13.2 Early Retirement. A Participant may elect to retire before reaching
his Normal Retirement Date, but not before the later of his completion of ten
(10) years of Vesting Service and his attainment of age fifty-five (55). In the
event of such early retirement, such Participant shall be entitled to receive an
amount equal to the sum of the amounts then credited to all Accounts held for
his benefit. Such distribution shall be made in accordance with the provisions
of Article 15 hereof.
13.3 Late Retirement. In the event a Participant works for a Participating
Employer or an Affiliate beyond his Normal Retirement Date, his retirement shall
be deemed to have occurred on the date of his Termination of Employment with the
Participating Employer or an Affiliate for any reason other than death. In the
event of such late retirement, such Participant shall be entitled to receive a
distribution of his Account balances. Subject to Section 15.1 hereof, such
distribution shall be made or shall commence to be made on such date, on or
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after the Participant's Termination of Employment, as the Participant shall
elect. Such distribution shall be made in accordance with the provisions of
Article 15 hereof. Notwithstanding anything to the contrary contained in this
Plan, a Participant who continues in the employ of a Participating Employer
beyond his Normal Retirement Date shall be entitled to elect, upon providing
such notice as the Administrator shall require, that all or a portion of his
Account balances be distributed to him in accordance with Article 15 hereof as
of a date coinciding with or following his Normal Retirement Date which shall be
selected by the Participant.
13.4 Disability Retirement. Upon receipt from a Participant, or a person
authorized by him or on his behalf, of a request that distributions be made on
account of such Participant's Total and Permanent Disability, or upon its own
motion, the Administrator shall determine the extent of the Participant's
disability. If the Administrator shall determine that the Participant is totally
and permanently disabled, his date of disability retirement shall be deemed to
have been the earlier of the date on which his application for distribution
under this Section was filed with the Administrator or the date on which the
Administrator determined him to be totally and permanently disabled, and, except
as provided in Sections 6.1 and 6.2 hereof, he will be deemed to have ceased to
be an Active Participant on that date. Such a disabled Participant shall be
entitled to receive a distribution equal to his Account balances. Such
distribution shall be made or shall commence to be made as of such date, on or
after the date such Participant is determined to be totally and permanently
disabled, as the Participant, or a person authorized by him or on his behalf,
shall select. Such distribution shall be made in accordance with the provisions
of Article 15 hereof.
13.5 Application for Benefits. Each Participant who is eligible for
benefits under this Article shall apply therefor on a form which shall be given
to him for that purpose by the Administrator; provided, however that the
foregoing requirement shall not apply in any case in which a Participant shall
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be unable, for physical, mental or any other reason satisfactory to the
Administrator to make such application. Upon finding that such Participant
satisfies the eligibility requirements for benefits under this Article, the
Administrator shall promptly notify the Trustee in writing of his eligibility
and of the method of distribution selected in accordance with Article 15.
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ARTICLE 14
DEATH BENEFITS
14.1 Pre-Retirement Death Benefits. In the event of the Termination of
Employment of a Participant by reason of his death, or the death of a retired or
terminated Participant prior to his Annuity Starting Date, his Beneficiary shall
be entitled to receive a distribution of the deceased Participant's vested
Account balances. Such amount shall be distributed or commence to be distributed
as soon as practicable following such Participant's death.
14.2 Death of a Retired or Terminated Participant After Commencement of
Distribution. In the event of the death of a retired or terminated Participant
after his Annuity Starting Date, no benefits shall be payable to his Beneficiary
except to the extent provided for by the method under which the retired or
terminated Participant was receiving distributions under Article 15 hereof.
14.3 Form of Payment of Death Benefits. Except as provided in Section 14.4,
the Administrator shall direct the Trustee to distribute the Participant's
Account balance to his Beneficiary in accordance with Article 15 hereof.
14.4 Qualified Preretirement Survivor Annuity. Except as provided in
Section 15.6 hereof, if a death benefit should be payable to the Beneficiary of
a Participant who is described in Section 15.3 pursuant to this Article, his
spouse shall be entitled to receive a death benefit in the form of a Qualified
Preretirement Survivor Annuity, which shall be the actuarial equivalent of such
Participant's distributable Accounts determined as of the date payment of
benefits commence.
14.5 Waiver of Qualified Preretirement Survivor Annuity. A Participant
described in Section 15.3 may elect, at any time after the first day of the Plan
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Year in which he attains age thirty-five (35) and subject to obtaining spousal
consent pursuant to Section 24.8 hereof, to waive the Qualified Preretirement
Survivor Annuity described in Section 14.4. A Participant who has incurred a
Termination of Employment may elect, at any time after his Termination of
Employment and subject to obtaining spousal consent pursuant to Section 24.8
hereof, to waive the Qualified Preretirement Survivor Annuity described in
Section 14.4 with respect to his Account balances accrued prior to his
Termination of Employment. Any election made under this Section 14.5 may be
revoked at any time and, once revoked, may be made again.
14.6 Notification and Waiver Procedures. The Administrator shall furnish to
each Participant described in Section 15.3 a written notification of the terms
of the Qualified Preretirement Survivor Annuity within the three (3) year period
beginning with the first day of the Plan Year in which such Participant attains
age thirty-two (32), or if such Participant commences participation in the Plan
after he attains age thirty-two (32), no later than the close of the second Plan
Year beginning after his commencement of participation. Such notification shall
contain a general description of the Qualified Preretirement Survivor Annuity,
the circumstances under which it will be paid, the Participant's right to make,
and the effect of, an election to waive such coverage, the rights of such
Participant's spouse with respect thereto, and the Participant's right to make,
and the effect of, a revocation of such election.
14.7 Automatic Beneficiary. Unless a Participant has designated a
Beneficiary in accordance with the provisions of Section 14.8 hereof, his
Beneficiary shall be deemed to be the person or persons in the first of the
following classes in which there are any survivors of such Participant:
(a) his spouse at the time of his death;
(b) his issue, per stirpes;
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(c) his parents; and
(d) the executor or administrator of his estate.
14.8 Designation of Beneficiary. In lieu of having the benefits payable
pursuant to this Article payable to a Beneficiary determined in accordance with
the provisions of Section 14.7, a Participant who is not described in Section
14.5 hereof may sign a document designating a Beneficiary or Beneficiaries to
receive such benefits. Notwithstanding the foregoing, no designation of a
Beneficiary or Beneficiaries by a married Participant under this Section 14.8
shall be valid unless:
(a) the Participant's surviving spouse has signed a document,
witnessed by a notary public, consenting to such designation and
acknowledging the effect of any such designation; or
(b) it is established to the satisfaction of the Administrator that
the signature of such spouse cannot be obtained because such spouse cannot
be located or because of such other circumstances as the Secretary of the
Treasury may prescribe by lawful regulations; or
(c) it is established to the satisfaction of the Administrator that
the Participant has no surviving spouse.
Any consent given by a surviving spouse pursuant to this Section shall be
effective only with respect to such spouse and shall not be effective with
respect to any other spouse of such Participant. In addition, any designations
under this Section 14.8 shall be deemed to be automatically revoked in the event
a Participant remarries.
14.9 Instructions to Trustee. Upon the death of a Participant or a former
Participant, the Administrator shall immediately advise the Trustee of the
identity of such Participant's or former Participant's Beneficiary or
Beneficiaries. The Trustee shall be completely protected in making distributions
to any person or persons in any sums in accordance with the instructions it
receives from the Administrator.
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14.10 Incomplete Disposition. In the event that a Participant or former
Participant dies at a time when he has a designation on file with the
Administrator which does not dispose of the total benefit distributable under
this Plan upon his death, then the portion of such benefit distributable on
behalf of said Participant or former Participant, the disposition of which was
not determined by the deceased Participant's or former Participant's
designation, shall be distributed to his spouse, if any, or to a Beneficiary
determined under the provisions of Section 14.8 hereof.
14.11 Resolution of Ambiguity. Any ambiguity in a Participant's or former
Participant's Beneficiary designation shall be resolved by the Administrator.
Subject to Section 24.8 hereof, the Administrator may direct a Participant or
former Participant to clarify his designation and if necessary execute a new
designation containing such clarification.
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ARTICLE 15
DISTRIBUTIONS
15.1 Deferral of Distributions. Distributions will normally commence as of
the dates specified in Articles 12, 13, and 14 hereof. However, subject to
Sections 15.6 and 15.7 hereof, a Participant, former Participant or Beneficiary
may elect in writing to defer any distributions until a later date.
15.2 Normal Method of Distribution. Except as provided in Sections 14.4,
15.3 and 15.6 hereof, a Participant or Beneficiary shall elect to receive his
distributable Account balances either in the form of a single lump sum payment
or in nearly equal monthly, quarterly, semi-annual or annual installment
payments over a period specified by such Participant or Beneficiary.
Notwithstanding the foregoing, a Participant or Beneficiary who has elected to
receive and has commenced receiving his distributable Account balance in the
form of installment payments may at any time prior to payment of the final
installment payment make an election to receive his remaining Account balance in
the form of a single lump sum payment as soon as practicable following his
election.
All distributions under the Plan shall be in the form of cash, unless a
Participant or Beneficiary shall elect to receive the Shares credited to his
Stock Bonus Account in lieu of cash. The value of any fractional Shares credited
to a Participant's Stock Bonus Account shall be distributed in the form of cash.
15.3 Annuity Methods of Distribution. Subject to Section 15.6 hereof and
prior to September 1, 2001, a Participant who was a Participant under this Plan
prior to the Restatement Date or the Beneficiary of such a Participant shall
receive the amounts distributable to him (other than amounts and shares credited
to his Stock Bonus Account) in the form of the following type of annuity
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contract purchased for him from an insurance company by the Administrator
pursuant to Section 15.9 hereof:
(i) an immediate Joint and Survivor Annuity contract issued on
the joint lives of such Participant and his Beneficiary with the
provision that after the Participant's death fifty percent (50%) (or
at the Participant's election one hundred percent (100%)) of his
monthly annuity payments shall continue during the life of and be paid
to such Beneficiary; or
(ii) an immediate Life Annuity contract issued on the life of
such Participant or Beneficiary.
Only Participants who are described above (and the Beneficiaries of any such
Participants) shall be able to receive an annuity method of distribution
pursuant to this Section.
The foregoing provisions of this Section shall not apply to any
Participants, former Participants or Beneficiaries whose distributions have not
commenced prior to the Annuity Elimination Date.
15.4 Explanation of Annuity Method of Distribution. The Administrator
shall, no less than thirty (30) days and no more than ninety (90) days prior to
the date the Accounts of a Participant or Beneficiary described in Section 15.3
become distributable pursuant to Article 12, 13 or 14 hereof, provide such
individual with a written explanation of the terms and conditions of the
Qualified Joint and Survivor Annuity method of distribution, the individual's
right to revoke such election or to elect a method of distribution described in
Section 15.2, the effect of such revocation or election, the right of a
Participant's spouse under the Qualified Joint and Survivor Annuity method of
distribution and the relative values of the methods of distribution available.
15.5 Election Against Annuity Method of Distribution. To elect one of the
optional methods of distribution set forth in Section 15.2, a Participant or
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Beneficiary described in Section 15.3 shall notify the Administrator of such
election in writing. If a such a Participant is married, any such election of an
optional form of payment shall be effective only if his spouse consents to such
election in accordance with Section 24.8 hereof.
A Participant shall be allowed to make such election for ninety (90) days
after having received a written explanation of the Qualified Joint and Survivor
Annuity form of payment pursuant to Section 417(a)(3)(A) of the Code and any
lawful regulations thereunder; provided, that a Participant's distribution shall
be delayed if necessary to insure that the Participant shall have at least
thirty (30) days after he receives the information required by Section
417(a)(3)(A) of the Code within which to elect a form of payment. In addition to
the foregoing, a Participant may, subject to the spousal consent requirement,
revoke a prior election and elect another optional method of distribution, if
desired, prior to the date benefits will be paid or will commence to be paid to
him, as long as such ninety (90) day period has not expired.
15.6 Cash-Out of Small Account Balances. In the event that the value of a
retired, terminated or deceased Participant's distributable Account balances
does not exceed Five Thousand Dollars ($5,000.00) at the time of distribution,
or at the time of any prior distribution, the Administrator shall direct the
Trustee to distribute such distributable Account balances in a single lump sum
payment without the consent of the Participant, his spouse or his Beneficiary;
provided, however, that the Trustee shall not make any such single lump sum
payment after the date a Participant's distribution has commenced unless the
Participant and his spouse, if any, or in the case of a payment to the surviving
spouse of a deceased Participant, the spouse, consent to the single lump sum
payment in writing and provided further that any such lump sum payment shall be
made in accordance with the provisions of Section 15.11 hereof. Unless such a
Participant or Beneficiary elects to receive a distribution which includes whole
Shares, the Trustee shall sell any Shares or other assets credited to his
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distributable Accounts as of the date distribution is to be made and distribute
the amount of his distributable Account balances in a single lump sum payment of
cash. Any such single lump sum payment shall be in full settlement of such
Participant's, spouse's or Beneficiary's rights under this Plan.
15.7 Restrictions on Distributions. Notwithstanding any other provisions of
this Plan, distributions made hereunder shall be subject to the following
restrictions:
(a) in the case of a living Participant:
(i) distribution must commence on or before the April 1 following
the end of the calendar year in which:
(A) he attains age seventy and one-half (70-1/2) or retires,
whichever is later, if the Participant is not a five percent (5%)
owner with respect to the Plan Year ending in such calendar year;
or
(B) he attains age seventy and one-half (70-1/2) if the
Participant is a five percent (5%) owner with respect to the Plan
Year ending in such calendar year;
(ii) annuity payments shall not be made beyond the life of the
Participant or the joint lives of the Participant and his spouse or
Beneficiary;
(iii) installment distributions shall not be payable over a
period of years in excess of his life expectancy or the joint life
expectancies of himself and his spouse or Beneficiary; and
(b) in the case of a deceased Participant, distributions after his
death shall be payable either:
(i) within five (5) years of the date of his death; or
(ii) if distribution commences to his Beneficiary, either:
(A) within one (1) year of the date of his death or on a
later date permitted under any lawful regulations issued by the
Secretary of the Treasury; or
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(B) if his spouse is his Beneficiary, by the date such
Participant would have attained age seventy and one-half
(70-1/2);
over the life of such Beneficiary or over a period not extending
beyond the life expectancy of such Beneficiary; or
(iii) if the Participant's distribution had commenced prior to
his death under a form of payment meeting the requirements of
subparagraph (a)(ii) or (a)(iii) above, such distribution must be
completed by the remainder of the period specified in said
subparagraph (a)(ii) or (a)(iii); or
(iv) if the Participant's distribution had not commenced prior to
his death under a form of payment meeting the requirements of
subparagraph (a)(ii) or (a)(iii) above and the Participant's spouse is
entitled to a distribution hereunder but dies prior to the
commencement of such distribution, then the limitations of this
Section 15.7(b) shall be applied as if the spouse were the
Participant; and
(c) in the event payments are made to a Participant's child, for
purposes of this Section such payments shall be deemed to be paid to the
Participant's spouse if such payments will become payable to such spouse
upon such child reaching majority or any other event permitted under any
lawful regulations issued by the Secretary of the Treasury.
A Participant or Beneficiary may elect to have his life expectancy redetermined
from time to time but no more frequently than annually. In the event a
Participant or Beneficiary fails to make such an election, then no recalculation
shall be performed. Notwithstanding the foregoing, with respect to distributions
made on or after July 1, 2001, the Plan will apply the minimum distribution
requirements of Section 401(a)(9) of the Code in accordance with the regulations
under Section 401(a)(9) that were proposed on July 1, 2001. This provision shall
continue in effect until the end of last calendar year beginning before the
effective date of final regulations under Section 401(a)(9) or such other date
as may be specified in guidance published by the Internal Revenue Service.
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15.8 Incidental Death Benefit Requirements. Except in the case of a joint
and survivor annuity contract issued on the joint lives of a Participant and his
spouse, any other method of distribution payable to a Participant shall conform
to the incidental death benefit requirements of Section 1.401(a)(9)-2 of the
Treasury Regulations. Notwithstanding the foregoing, with respect to
distributions made on or after January 17, 2001, the Plan will apply the minimum
distribution requirements of Section 401(a)(9) of the Code in accordance with
the regulations under Section 401(a)(9) that were proposed on January 17, 2001.
This provision shall continue in effect until the end of last calendar year
beginning before the effective date of final regulations under Section 401(a)(9)
or such other date as may be specified in guidance published by the Internal
Revenue Service.
15.9 Purchase and Transfer of Annuity Contract. In the event a Participant
or Beneficiary shall be entitled to receive distribution of his Accounts in the
form of an annuity, the Administrator shall direct the Trustee to sell any
Shares and any other assets credited to his Accounts and the Administrator shall
use the amount of his distributable Accounts to purchase an annuity contract
from an insurance company. If the Administrator obtains an annuity contract or
contracts for the benefit of a Participant or a Beneficiary as provided above,
the Administrator shall, after having selected such settlement options and
placed such restrictive endorsements thereon as it deems necessary or desirable,
transfer ownership of the contract or contracts to such Participant or
Beneficiary and deliver said contract or contracts to him.
15.10 Maintenance of Account. As long as assets of this Plan remain
credited to an Account of a Participant or Beneficiary, the Administrator shall
continue to maintain and administer said Account in accordance with the terms
and provisions of this Plan.
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15.11 Direct Rollover. Any distribution made hereunder to a Distributee
shall be made directly to such Distributee unless he elects a Direct Rollover
pursuant to the second paragraph of this Section; provided, however, that the
Distributee must acknowledge in writing that he understands that any payment
which includes more than two hundred dollars ($200.00) in cash and which, under
Code Section 402(c), is eligible to be rolled over to an Eligible Retirement
Plan will be subject to withholding taxes.
Each Distributee shall have the right to direct that any distribution
which, under Code Section 402(c), qualifies as an Eligible Rollover Distribution
be transferred directly to an Eligible Retirement Plan. A Distributee may direct
that part of the distribution be transferred directly to an Eligible Retirement
Plan and the balance be paid to him. A Distributee is not permitted to direct
that his distribution be transferred directly to more than one Eligible
Retirement Plan. In the event that a Distributee fails to make any direction,
the distribution shall be paid directly to him after deduction of appropriate
withholding taxes.
Unless the context otherwise indicates, the following terms shall have the
following meanings whenever used in this Section:
(a) "Eligible Rollover Distribution" shall mean any distribution of
all or any portion of the balance to the credit of the Distributee, except
that an Eligible Rollover Distribution does not include:
(i) any distribution that is one of a series of substantially
equal periodic payments (not less frequently than annually) made for
the life (or life expectancy) of the Distributee or the joint lives
(or joint life expectancies) of the Distributee and the Distributee's
designated Beneficiary, or for a specified period of ten (10) years or
more;
(ii) any distribution to the extent such distribution is required
under Section 15.7 hereof which reflects the requirements under
Section 401(a)(9) of the Code;
(iii) the portion of any distribution that is not includible in
gross income (determined without regard to the exclusion for net
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unrealized appreciation with respect to employer securities), except
that for distributions made on or after January 1, 2002, after tax
contributions are included in a Participant's Eligible Rollover
Distribution; and
(iv) effective for distributions occurring on or after January 1,
2002, any hardship distribution made in accordance with Article 10.
(b) "Eligible Retirement Plan" shall mean:
(i) an individual retirement account described in Section 408(a)
of the Code;
(ii) an individual retirement annuity described in Section 408(b)
of the Code;
(iii) an annuity plan described in Section 403(a) of the Code;
(iv) a qualified trust described in Section 401(a) of the Code;
or
(v) effective for distributions made on or after January 1, 2002,
an eligible deferred compensation plan described in Section 457(b) of
the Code which is maintained by an eligible employer described in
Section 457(e)(1)(A) of the Code; or
(vi) effective for distributions made on or after January 1,
2002, an annuity contract described in Section 403(b) of the Code,
that accepts the Distributee's Eligible Rollover Distribution.
Notwithstanding the foregoing, for Plan Years beginning before
January 1, 2002, in the case of an Eligible Rollover Distribution
to the surviving spouse of a deceased Employee, an Eligible
Retirement Plan is limited to an individual retirement account or
individual retirement annuity.
(c) "Distributee" shall mean:
(i) an Employee or former Employee; and
(ii) an Employee's or a former Employee's surviving spouse and an
Employee's or former Employee's spouse or former spouse who is the
Alternate Payee under a Qualified Domestic Relations Order, as defined
in Section 2.43 hereof, without regard to the interest of the spouse
or former spouse.
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(d) "Direct Rollover" shall mean a payment by this Plan to the
Eligible Retirement Plan specified by the Distributee.
15.12 Missing Participants. If, after reasonable efforts of the
Administrator to locate a Participant or the Beneficiary of a deceased
Participant, including sending a certified letter, return receipt requested, to
the last known address of the Participant or Beneficiary, the Administrator is
unable to locate the Participant or Beneficiary, then the amounts distributable
to such Participant or Beneficiary shall, pursuant to applicable state or
Federal laws, be treated as a forfeiture under the Plan. In the event that such
a Participant or Beneficiary is located subsequent to such a forfeiture, then,
pursuant to applicable state or Federal laws, his benefit shall be reinstated
(without earnings from the date of forfeiture except to the extent required by
law) and shall not be used to determine his Annual Additions for the Plan Year
in which it is reinstated. If the Plan is joined as a party to any escheat
proceedings involving an amount forfeited pursuant to this Section, the Plan
shall comply with the final judgment as if it were a claim filed by the form
Participant or Beneficiary and shall pay in accordance with said judgment.
15.13 Pre-Restatement Date Methods of Distribution. Notwithstanding any
provisions of this Article to the contrary, the method of distribution being
utilized, as of the date immediately prior to the Restatement Date, to
distribute benefits to or with respect to Participants who had retired, died,
become disabled, or terminated employment prior to the Restatement Date shall
not be changed.
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ARTICLE 16
ADMINISTRATION
16.1 Powers and Duties of Administrator. The Board of Directors shall
appoint the Administrator which shall be any person(s), corporation or
partnership, (including the Company itself) as the Board of Directors shall deem
desirable in its sole discretion. The Company shall notify the Trustee of the
identity of the Administrator and of any change therein. As of the Restatement
Date, the Administrator shall be the Company. The Company, in its capacity as
Administrator, shall have the power to delegate to agents or delegates, the
right to exercise any powers given to the Administrator hereunder or under law
and/or the obligation to carry out any or all of its duties as Administrator.
Any reference contained in the Plan to the Administrator shall be deemed to
apply also to an agent or delegate, if the Company shall have delegated such
duty or power to the agent or delegate.
Except as expressly set forth herein with respect to the duties and
responsibilities of the Trustee, the Participating Employers or the Committee,
the Administrator shall administer this Plan and shall have all powers and
duties granted or imposed on an "administrator" by ERISA. The Administrator
shall determine any and all questions of fact, resolve all questions of
interpretation of this instrument which may arise under any of the provisions of
this Plan as to which no other provision for determination is made hereunder,
and exercise all other powers and discretions necessary to be exercised under
the terms of this Plan which it is herein given or for which no contrary
provision is made. Subject to the provisions of Section 16.6 hereof, the
Administrator's decision with respect to any matter shall be final and binding
upon the Trustee and all other parties concerned, and neither the Administrator
nor any of its directors, officers or Employees, if applicable, shall be liable
in that regard except for gross abuse of the discretion given it and them under
the terms of this Plan. In rendering its decisions hereunder, the Administrator
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shall have full power and discretion to interpret this Plan, to resolve
ambiguities, inconsistencies, and omissions, to determine any question of fact,
and to determine the right to benefits of, and the amount, time and form of
benefits, if any, payable to, the applicant in accordance with the provisions of
this Plan. No benefits shall be payable hereunder unless the Administrator (or,
if the Administrator's decision is appealed, the Committee acting in its review
capacity hereunder) determines in its discretion such benefit is due under the
terms of this Plan. All determinations of the Administrator, and other exercises
of the Administrator's discretion hereunder shall be made in such manner as the
Administrator determines to be in accord with applicable law and generally
uniform, consistent, and nondiscriminatory with respect to all Participants and
Beneficiaries in similar circumstances. The Administrator, from time to time,
may designate one or more persons or agents to carry out any or all of its
duties hereunder. All determinations of the Administrator and other exercises of
the Administrator's discretion hereunder shall be made in such a manner as the
Administrator determines to be in accord with applicable law and generally
uniform, consistent and nondiscriminatory with respect to all Participants,
former Participants and Beneficiaries in similar circumstances. The
Administrator, from time to time, may designate one or more persons or agents to
carry out any or all of its duties hereunder.
Without limiting any other powers expressly granted to the Administrator
hereunder, the Administrator shall have the power to adopt and implement such
rules and procedures regarding the administration of the Plan as the
Administrator may deem appropriate. Notwithstanding any provision of the Plan to
the contrary, such rules and procedures may permit or require any elections by
Participants, former Participants, or Beneficiaries regarding deferrals,
after-tax contributions, investments, loans, withdrawals and distributions to be
made in such form (including in writing, orally, telephonically, or
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electronically) as the Administrator may determine. In addition, the
Administrator shall have the power to rename, combine, and separate Accounts,
establish sub-Accounts, or otherwise restructure any Accounts under this Plan or
any Supplement in such manner as the Administrator deems appropriate for the
administration of the Plan, provided that such restructuring shall not change
the balance of the Accounts of any Participant as of the time of such
restructuring (disregarding the impact of any rounding). Unless the Plan
specifically provides otherwise, the provisions of the Plan with respect to
vesting, distribution rights and restrictions, loan rights and restrictions,
investment rights, and other features applicable to the balance of any Account
of any Participant prior to such restructuring shall continue with respect to
the portion of the Accounts of such Participant after the restructuring which
are attributable to such balance. All references in this Plan to any Account
prior to such a restructuring shall thereafter be deemed to refer to the
Account, Accounts, or portions thereof into which such prior Account was
restructured.
16.2 Application for Retirement Benefits. Each Participant or Beneficiary
who is eligible for benefits under Article 12, 13, or 14 shall apply therefor on
a form which shall be given to him for that purpose by the Administrator;
provided, however, that the foregoing requirement shall not apply in any case in
which a Participant or Beneficiary shall be unable, for physical, mental, or any
other reason satisfactory to the Administrator to make such application. The
Administrator shall not process any application filed by a Participant or
Beneficiary with respect to a retroactive claim for benefits. Upon finding that
such Participant or Beneficiary satisfies the eligibility requirements for
benefits under Article 12, 13, or 14, the Administrator shall promptly notify
the Trustee in writing of his eligibility and of the method of distribution
selected in accordance with Article 15.
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Notwithstanding anything contained herein to the contrary, a Participant
must file a claim for disability retirement benefits pursuant to Article 13
hereof within one hundred twenty (120) days following such Participant's
Termination of Employment due to this Total and Permanent Disability.
16.3 Denial of Benefit Claim. If any Participant, any former Participant,
any Beneficiary or the authorized representative of a Participant, former
Participant or Beneficiary shall file an application for benefits hereunder and
such application is denied, in whole or in part, he shall be notified in writing
of the specific reason or reasons for such denial unless the granting or denial
of the application is in the sole discretion of the Administrator, in which
event the notice to the applicant shall state that the Administrator has denied
the application pursuant to the exercise of its discretionary powers under this
Plan. The notice shall also set forth the specific Plan provisions upon which
the denial is based, an explanation of the provisions of Section 16.6 hereof and
any other information deemed necessary or advisable by the Administrator. Such
notice shall be issued within ninety (90) days of the filing of a claim by a
Participant, former Participant or Beneficiary; provided, however, that such
ninety (90) day time period may be extended for a period of up to an additional
ninety (90) days in the event that special circumstances require an extension of
time for processing the claim. If such an extension of time for processing the
claim is required, written notice of such extension shall be furnished to the
applicant prior to the end of the initial ninety (90) day period. Such notice
shall also indicate the special circumstances which make such extension
necessary.
16.4 Administrative Committee. The Board of Directors or the appropriate
officers of the Company shall appoint the members of an Administrative Committee
which shall consist of two (2) or more members. The members of the Committee
shall remain in office at the will of the Board of Directors or the Company, and
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the Board of Directors or the Company, from time to time, may remove any of said
members with or without cause. A member of the Committee may resign upon written
notice to the Board of Directors or appropriate officer of the Company. The fact
that a person is a Participant or a former Participant or a prospective
Participant shall not disqualify him from acting as a member of the Committee.
In case of the death, resignation or removal of any member of the Committee, the
remaining members shall act until a successor-member shall be appointed. The
Company shall notify the Trustee in writing of the names of the members of the
Administrative Committee, of any and all changes in the membership of the
Administrative Committee, of the member designated as Chairman and the member
designated as Secretary, and of any changes in either office. Until notified of
a change, the Trustee shall be protected in assuming that there has been no
change in the membership of the Administrative Committee since the last
notification was filed with it. All communications to the Committee shall be
addressed to its Secretary at the address of the Company.
16.5 Committee Procedures. The Committee may act on a matter of day-to-day
administration of the Plan by decision of any two (2) or more of its members. On
all matters relating to claims review, the decision of a majority of the members
of the Committee shall govern and control, but a meeting need not be called or
held to make any decision. The Committee shall appoint one of its members to act
as its Chairman and another member to act as Secretary. The terms of office of
these members shall be determined by the Committee, and the Secretary and/or
Chairman may be removed by the other members of the Committee for any reason
which such other members may deem just and proper. The Secretary shall do all
things directed by the Committee. Any notice served or demand made on the
Secretary shall be deemed to have been served or made upon the Committee.
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16.6 Claims Review Procedures. Any Participant, any former Participant, any
Beneficiary or any authorized representative of a Participant, former
Participant or Beneficiary whose application for benefits hereunder has been
denied, in whole or in part, by the Administrator, may within sixty (60) days
after receipt of written notice of denial of his claim and upon written notice
to the Committee request a review by the Committee of such denial of his
application. Such review may be made by written briefs submitted by the
applicant and the Administrator or at a hearing, or by both, as shall be deemed
necessary by the Committee. Any such hearing shall be held in the main offices
of the Company, or at such other location as shall be agreed upon among the
Administrator, the Committee and the applicant, on such date and at such time as
the Committee shall designate upon not less than seven (7) days' notice to the
applicant and the Administrator unless both of them accept shorter notice. The
Committee shall make every effort to schedule the hearing on a day and at a time
which is convenient to both the applicant and the Administrator. No later than
sixty (60) days after the review has been completed, the Committee shall render
a decision in writing, a copy of which shall be sent to both the applicant and
the Administrator. In the event that the Committee does not reach a decision
within said sixty (60) day period, the applicant shall be notified of the delay,
in writing, and said decision shall be rendered no later than one hundred twenty
(120) days following the applicant's request for review. In rendering its
decision, the Committee shall have full power and discretion to interpret this
Plan, to resolve ambiguities, inconsistencies and omissions, to determine any
question of fact, to determine the right to benefits of, and the amount of
benefits, if any, payable to, the applicant in accordance with the provisions of
this Plan. Such decision shall set forth the specific reason or reasons for the
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decision and the specific Plan provisions upon which the decision is based. Such
decision shall be final and binding on the applicant, the Trustee, the
Participating Employers and the Administrator.
No legal action may be commenced against the Plan, the Administrator or the
Committee more than one hundred eighty (180) days after the Committee's final
decision has been rendered with respect to all or any portion of the claim.
16.7 Fees and Expenses. No member of the Committee shall be disqualified
from acting on any question because of his interest therein. No fee or
compensation shall be paid to any member of the Committee for his services as
such, but the Committee shall be reimbursed for its expenses from the Trust
Fund, unless such expenses are paid by the Participating Employers. The
Committee and the Administrator may hire such attorneys, accountants, agents,
clerks, recordkeepers and secretaries as they deem desirable in the performance
of their functions.
The expenses of administration of this Plan incurred by the Committee, the
Administrator or the Trustee, including but not limited to, accountants' fees,
attorneys' fees, and the fees charged by the Trustee or agents of the Committee
or the Administrator, shall be paid in any one of the following manners as
determined by the Company in its sole discretion:
(a) out of the Trust Fund;
(b) out of individual Participants' Accounts, if such fees directly
relate to such Participants Account activities;
(c) out of the annual contributions of the Participating Employers, if
any; or
(d) directly by the Participating Employers.
16.8 Exhaustion of Review Procedures; Statute of Limitations. The
interpretations, determinations and decisions of the Administrator and the
Committee shall, except to the extent provided in Section 16.6 hereof, be final
and binding upon all persons with respect to any right, benefit and privilege
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hereunder. Except as otherwise provided in ERISA, the review procedures of said
Section 16.6 shall be the sole and exclusive remedy and shall be in lieu of all
actions at law, in equity, pursuant to arbitration or otherwise. In any event, a
Participant, former Participant or Beneficiary must exhaust the review
procedures of Section 16.6 hereof prior to the commencement of any such action.
For claims incurred on or after the Restatement Date, no legal action may be
commenced against the Plan, the Administrator or the Committee more than one
hundred eighty (180) days after the Committee's final decision has been
rendered, in accordance with Section 16.6, with respect to all or any portion of
the claim.
16.9 Delegated Duties and Responsibilities. The Participating Employers,
Administrator, Committee, Board of Directors, Trustee and their respective
officers, members, Employees and agents shall have no duty or responsibility
under this Plan other than the duties and responsibilities expressly assigned to
them herein or delegated to them pursuant hereto or the Trust Agreement. None of
them shall have any duty or responsibility with respect to the duties or
responsibilities assigned or delegated to another of them. In no event shall the
Participating Employers, Administrator, Committee, Board of Directors or their
respective officers, members, Employees and agents be deemed to have any duty or
responsibility with respect to the holding, safekeeping, investment,
reinvestment and administration of the Trust Fund.
16.10 Limitation of Liability and Indemnification. Except as otherwise
provided in ERISA, the Administrator, Committee, Board of Directors, and their
respective officers and members shall incur no personal liability of any nature
whatsoever in connection with any act done or omitted to be done in the
administration of this Plan. The Participating Employers shall indemnify,
defend, and hold harmless the Administrator, Committee, Board of Directors, and
their respective officers, Employees, members and agents, for all acts taken or
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omitted in carrying out their responsibilities under the terms of this Plan or
other responsibilities imposed upon such persons by ERISA. This indemnification
for all acts or omissions is intentionally broad, but shall not provide
indemnification for embezzlement or diversion of Trust funds for the benefit of
any such persons, nor shall it provide indemnification for excise taxes imposed
under Section 4975 of the Code. The Participating Employers shall indemnify such
persons for expenses of defending an action by a Participant, former
Participant, Beneficiary, government entity, or other persons, including all
legal fees and other costs of such defense. The Participating Employers will
also reimburse such a person for any monetary recovery in a successful action
against such person in any federal or state court or arbitration. In addition,
if the claim is settled out of court with the concurrence of the Company, the
Participating Employers shall indemnify such person for any monetary liability
under said settlement.
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ARTICLE 17
PROHIBITION AGAINST ALIENATION
17.1 Non-Alienation of Benefits. Neither any property nor any interest in
any property held for the benefit of any Participant, former Participant or
Beneficiary shall be alienated, disposed of or in any manner encumbered,
voluntarily, involuntarily or by operation of law, while in the possession or
control of the Trustee except by an act of the Trustee or the Participant,
former Participant or Beneficiary specifically authorized hereunder.
17.2 Exception For Qualified Domestic Relations Order. Section 17.1 hereof
shall not apply to the creation, assignment or recognition of a right to any
benefit under this Plan pursuant to a Qualified Domestic Relations Order and
shall not apply to the payment of any benefits to an Alternate Payee pursuant to
such an order.
17.3 Procedures For Determining Whether Order Is Qualified. In the event
this Plan is served with a Domestic Relations Order, the Administrator shall
promptly notify the Participant or former Participant and any Alternate Payee to
whom such order relates of the receipt of such order and this Plan's procedures
for determining whether such order is a Qualified Domestic Relations Order.
Within a reasonable time after receipt of such Domestic Relations Order, the
Administrator shall determine whether such order is a Qualified Domestic
Relations Order and shall notify the Participant or former Participant and each
Alternate Payee of its determination.
17.4 Segregated Account. During any period in which the issue of whether a
Domestic Relations Order is a Qualified Domestic Relations Order is being
determined, the Administrator shall direct the Trustee to credit the portion of
the Participant's or former Participant's Account balances which would have been
payable to an Alternate Payee during such period if the order had been
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determined to be a Qualified Domestic Relations Order during such period to a
segregated Account under this Plan and to debit the appropriate Accounts of the
Participant or former Participant. If the Domestic Relations Order is determined
to be a Qualified Domestic Relations Order within eighteen (18) months after
this Plan is served with such Domestic Relations Order, the Administrator shall
hold and dispose of the segregated Account balance in accordance with the terms
of the Qualified Domestic Relations Order. If:
(a) it is determined that such Domestic Relations Order is not a
Qualified Domestic Relations Order; or
(b) the issue with respect to whether such Domestic Relations Order is
a Qualified Domestic Relations Order is not resolved within eighteen (18)
months after this Plan is served with such Domestic Relations Order;
the Administrator shall transfer the segregated Account balance to the
appropriate Accounts maintained for the benefit of the person who would have
been entitled to such segregated Account balance if this Plan had never been
served with such Domestic Relations Order. If eighteen (18) months have elapsed
since this Plan was served with such Domestic Relations Order and such order is
subsequently determined to be a Qualified Domestic Relations Order, such order
shall only be applied prospectively.
17.5 Investment of Segregated Account. The balance credited to any
segregated Account which has been created under Section 17.4 hereof after this
Plan has been served with a Domestic Relations Order (other than Shares and
other amounts credited to the Invacare Segregated Stock Fund) shall be invested
in such of the Investment Funds established pursuant to Article 17 hereof as the
Participant to whom the Order relates shall direct until it is determined
whether such Domestic Relations Order is a Qualified Domestic Relations Order.
If the Order is determined to be a Qualified Domestic Relations Order, the
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Alternate Payee shall thereafter be entitled to direct the investment of such
Account (other than Shares and other amounts credited to the Invacare Segregated
Stock Fund) as though the Alternate Payee were a Participant.
17.6 Distributions Pursuant to Qualified Domestic Relations Orders. If a
Qualified Domestic Relations Order so provides, the segregated Account
established pursuant to Section 17.4 may be distributed to the Alternate Payee
at the time specified in the Qualified Domestic Relations Order, regardless of
whether the Participant is entitled to receive an immediate distribution from
the Plan at such time.
17.7 Application of Loan Provisions to Alternate Payees. An Alternate Payee
on whose behalf a segregated Account has been established shall not be entitled
to borrow from such Account. If a Qualified Domestic Relations Order specifies
that an Alternate Payee is entitled to any portion of the Accounts of a
Participant who has an outstanding loan balance, all outstanding loans shall
generally continue to be held in the Participant's Accounts and shall not be
divided between the Participant's and Alternate Payee's Accounts.
17.8 Review Procedures. Any Participant, former Participant or Alternate
Payee who is affected by a Domestic Relations Order served upon this Plan may,
upon written notice to the Committee, request a review by such Committee of the
Administrator's determination with respect to the qualification or lack of
qualification of such Domestic Relations Order. Any such review by the Committee
shall be subject to the rules and procedures set forth in Article 16 hereof.
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ARTICLE 18
AMENDMENT AND TERMINATION
18.1 Power to Amend and Terminate. This Plan may be modified, altered,
amended, changed or terminated by the Company at any time generally by action of
the Board of Directors. Notwithstanding the foregoing, the proper officers of
the Company shall have the power to amend the Plan in order to reflect desired
changes in the administrative provisions thereof or to make such changes to the
Plan as are required in order to maintain the tax qualification of the Plan
pursuant to Code Sections 401(a), 401(k), 401(m), 409 and 501(a). Any amendment
to the Plan shall be evidenced by an instrument in writing executed in the name
of the Company by one (1) or more duly authorized officers of the Company, but
no rights of Participants, former Participants or Beneficiaries receiving
benefits under this Plan and no other rights under this Plan which are protected
rights under Code Section 411(d)(6) shall in any way be reduced except as
permitted by the Code or the Secretary of the Treasury. This Plan as amended and
restated herein may be modified and amended retroactively, if necessary, to
secure exemption effective on the Restatement Date under Code Sections 401(a),
401(k), 401(m), 409 and 501(a). No amendment shall be binding on the Trustee
until the receipt of such amendment by the Trustee.
18.2 Termination. Upon termination of this Plan all assets of the Trust
Fund after deduction therefrom of any accrued expenses and fees of the Trustee
and any expenses and fees relating to such termination incurred or to be
incurred by the Trustee shall be allocated among the then existing Accounts.
Each such Account shall be adjusted in accordance with Sections 7.5 and 7.6
hereof. All Account balances of Participants and former Participants at the time
of termination of this Plan shall be fully vested and nonforfeitable. Such
Account balances shall be forthwith distributed to the Participant or former
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Participant for whose benefit the Accounts were established if he is living on
the date of termination, or if he shall have died before distribution, in
accordance with the provisions of Article 14 hereof.
Upon termination of this Plan all annuity policies held by the Trustee
shall be delivered, and all rights therein shall be transferred to those persons
then receiving benefits or entitled to receive benefits from them.
18.3 Partial Termination or Complete Discontinuance of Contributions. Upon
the partial termination of this Plan or upon complete discontinuance of
contributions to this Plan by the Participating Employers, the Account balances
of Participants affected by such partial termination or complete discontinuance
shall be fully vested and nonforfeitable. However, after any such partial
termination or complete discontinuance of contributions, the Administrator shall
continue to administer this Plan in the manner in which this Plan was
administered before any such partial termination and a Participant shall only be
entitled to receive benefits upon the occurrence of an event which under the
terms of this Plan would entitle him to receive such benefits. For purposes of
this Section, no event shall be a "partial termination" unless: (a) the Company
has so designated such event in a writing delivered to the Trustee; or (b) such
event has been finally and expressly determined to be a partial termination
within the meaning of Section 411(d) of the Code in an administrative or
judicial proceeding to which both the Company and the Commissioner of Internal
Revenue or his delegate were parties.
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ARTICLE 19
LIMITATIONS ON CONTRIBUTIONS
19.1 Contributions Are Subject to Limitations. The amount and allocation of
contributions under this Plan, including any contributions made pursuant to a
Supplemental Agreement, shall be subject to several limitations. Those
limitations are as follows:
(a) Salary Deferral Contributions shall be subject to the individual
dollar limit described in Section 19.2 hereof;
(b) Salary Deferral Contributions shall be subject to the Deferral
Percentage limit set forth in Section 19.3 hereof;
(c) Matching contributions and after-tax contributions shall be
subject to the Contribution Percentage limit set forth in Section 19.4
hereof;
(d) For Plan Years beginning before January 1, 2002, the contributions
described in subparagraphs (b) and (c) above shall be subject to the limit
on "multiple use" set forth in Section 19.5 hereof;
(e) All contributions made pursuant to Articles 5 and 6 hereof shall,
in the aggregate, be subject to the deductibility limit set forth in
Section 19.6 hereof; and
(f) The allocation of all of the foregoing contributions, in the
aggregate, shall be subject to the limitation on annual additions set forth
in Article 20 hereof.
In addition, the following rules and procedures shall apply for purposes of
this Article:
(i) For purposes of determining a Participant's Deferral or
Contribution Percentage pursuant to Section 19.8(b) or 19.8(c) hereof,
all Salary Deferral Contributions that are made under two (2) or more
plans (or after-tax and matching contributions, as appropriate) that
are aggregated for purposes of Sections 401(a)(4) or 410(b) of the
Code (other than Section 410(b)(2)(A)(ii) of the Code) shall be
treated as made under a single plan.
(ii) If two (2) or more plans are permissively aggregated for
purposes of Section 401(k) or 401(m) of the Code, the aggregated plans
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shall also satisfy Sections 401(a)(4) and 410(b) of the Code as though
they were a single plan.
(iii) The Deferral or Contribution Percentage of any Highly
Compensated Employee shall be determined by treating all plans
maintained by the Company and any Affiliates that are subject to
Section 401(k) or 401(m) of the Code (other than those that may not be
permissively aggregated) as a single plan.
19.2 The Dollar Limit. The Salary Deferral Contributions with respect to
the taxable year of a Participant plus similar amounts contributed on a similar
basis by any other employer (whether or not related to a Participating Employer)
required by law to be aggregated with his Salary Deferral Contributions under
this Plan shall not exceed Ten Thousand Five Hundred Dollars ($10,500.00) or,
effective as of the following dates:
Effective Date Dollar Limit
--------------- -------------------------------------
January 1, 2002 Eleven Thousand Dollars ($11,000.00)
January 1, 2003 Twelve Thousand Dollars ($12,000.00)
January 1, 2004 Thirteen Thousand Dollars ($13,000.00)
January 1, 2005 Fourteen Thousand Dollars ($14,000.00)
January 1, 2006 Fifteen Thousand Dollars ($15,000.00)
plus any adjustment for cost-of-living after 2001 as determined pursuant to
regulations issued by the Secretary of the Treasury or his delegate pursuant to
Section 415(d) of the Code.
In the event that the Salary Deferral Contributions for a Participant's
taxable year exceed such limit, or in the event that the Administrator shall
receive notice from a Participant by the March 1 next following the close of a
Participant's taxable year that his Salary Deferral Contributions, together with
similar contributions under plans of other employers shall have exceeded such
limit, the Administrator shall cause the amount of excess contributions,
together with any earnings allocable to such excess contributions, to be
refunded to the Participant by the following April 15th. Any such refund of
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excess contributions shall be debited from the Participant's Salary Deferral
Account.
19.3 Deferral Percentage Limit. Salary Deferral Contributions made on
behalf of a Participant for a Plan Year (hereinafter sometimes referred to as
the "current Plan Year") shall be limited so that the average Deferral
Percentage for the Highly Compensated Employees who are Participants or who are
eligible to become Participants for such Plan Year shall not exceed an amount
determined based upon the average Deferral Percentage for the Employees who are
Participants or who are eligible to become Participants but are not Highly
Compensated Employees for the preceding Plan Year or, if the Company elects, for
the current Plan Year, as follows:
(A) (B)
Average Deferral Limit on Average Deferral
Percentage for Employees Percentage for Employees
Eligible to Participate Eligible to Participate
who are not Highly who are Highly
Compensated Compensated
------------------------ -------------------------
Less than 2% 2 times Column (A)
2% or more but less than 8% Column (A) plus 2%
8% or more 1.25 times Column (A)
In the event the Company elects to determine the average Deferral Percentages of
Employees who are not Highly Compensated Employees on the basis of the current
Plan Year rather than the preceding Plan Year in accordance with Section
401(k)(3)(A) of the Code, such election by the Company may not be changed for
Plan Years commencing after December 31, 1998, except as provided by the
Secretary of the Treasury.
If, for any Plan Year, this Plan satisfies the requirements of Section 19.4
hereof, then the Company may elect, in such manner as the Secretary of the
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Treasury or his delegate may provide, to take into account, as additional
amounts for purposes of this Section, all or a part of the fully vested matching
contributions, if any, made for the Plan Year.
19.4 Contribution Percentage Limit. The contributions made for a Plan Year
(hereinafter sometimes referred to as "current Plan Year") as matching
contributions shall be limited so that the average Contribution Percentage for
the Highly Compensated Employees who are Participants or who are eligible to
become Participants for such Plan Year shall not exceed an amount determined
based upon the average Contribution Percentage for the Employees who are
Participants or who are eligible to become Participants but are not Highly
Compensated Employees for the preceding Plan Year or, if the Company elects, for
the current Plan Year, in accordance with the table set forth in Section 19.3
hereof.
In the event the Company elects to determine the average Contribution
Percentages of Employees who are not Highly Compensated Employees on the basis
of the current Plan Year rather than the preceding Plan Year in accordance with
Section 401(m)(2)(A) of the Code, such election by the Company may not be
changed for Plan Years commencing after December 31, 1998, except as provided by
the Secretary of the Treasury.
If, for any Plan Year, this Plan satisfies the requirements of Section 19.3
hereof, then the Company may elect, in such manner as the Secretary of the
Treasury or his delegate may provide, to take into account, as additional
amounts for purposes of this Section, all or a part of the Salary Deferral
Contributions made to this Plan.
19.5 Pre-2002 Multiple Use Limit. For Plan Years beginning prior to January
1, 2002, if the sum of the Deferral Percentage and the Contribution Percentage
for one or more Highly Compensated Employees exceeds the Aggregate Limit defined
in Section 19.8(a) hereof, the Contribution Percentage for such Employee or
Employees shall be reduced in accordance with Section 19.7 hereof so that the
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Aggregate Limit is not exceeded. The amount by which a Highly Compensated
Employee's Contribution Percentage is reduced shall be treated as an excess
contribution pursuant to Section 19.7. The Deferral Percentage and Contribution
Percentage of the Highly Compensated Employees shall be determined after any
corrections are made to meet the Deferral Percentage and Contribution Percentage
limits. Multiple use does not occur if neither the average Deferral Percentage
nor the average Contribution Percentage of the Highly Compensated Employees
exceeds one and twenty-five hundredths (1.25) multiplied by the corresponding
average Deferral Percentage or average Contribution Percentage of the Non-Highly
Compensated Employees.
19.6 Deductibility Limit. In no event shall the total of all contributions
made pursuant to Articles 5 and 6 hereof exceed the maximum amount allowable as
a deduction under Section 404(a)(3) of the Code or any statute of similar
import, including the amount of any contribution carryforward allowable under
said Section 404(a)(3) and, effective January 1, 2002, taking into account
Section 616 of the Economic Growth and Tax Relief Reconciliation Act of 2001.
Notwithstanding the foregoing, effective January 1, 2002, amounts contributed by
Participating Companies pursuant to Participants' elections under Section 5.1
hereof, shall not be considered in determining the maximum amount allowable as a
deduction. This limitation shall not apply to contributions which may be
required in order to provide the minimum contributions described in Article 24
hereof for any Plan Year in which this Plan is Top-Heavy. Nor shall this
limitation apply to contributions which may be required in order to recredit the
Account of any rehired Participant whose Account is to be recredited with prior
forfeitures as described in Section 12.5 hereof.
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19.7 Distribution of Excess Contributions. In the event that the
limitations set forth in Section 19.2, 19.3, 19.4 or 19.5 hereof shall be
exceeded, the Administrator shall take action to reduce future Salary Deferral
Contributions made pursuant to Article 5 hereof and/or future matching
contributions made pursuant to Article 6 hereof, as appropriate. Such action may
include a reduction in the future rate of Salary Deferral Contributions of any
Highly Compensated Employee pursuant to any legally permissible procedure. In
the event that such action shall fail to prevent the excess, prior Salary
Deferral Contributions made pursuant to Article 5 hereof, plus any income and
minus any losses allocable thereto to the date of distribution, shall be
distributed to the Participant on whose behalf such contributions were made. In
the event that any Salary Deferral Contributions made pursuant to Article 5
hereof are distributed to a Participant, any related matching contributions,
plus any income and minus any losses allocable thereto to the date of
distribution, shall be:
(a) forfeited and disposed of if such matching contributions are not
vested; and
(b) distributed to the Participant if such matching contributions are
vested.
In the event of such a distribution or forfeiture, the Salary Deferral Account,
and if applicable the Matching Contribution Account, of such Participant shall
be debited with the amount of such distribution or forfeiture. Any such
adjustments made in Participants' Accounts shall be made in a uniform manner for
similarly situated Participants.
In the event that distributions must be made in order to bring this Plan
into compliance with Section 19.3, 19.4 or 19.5 hereof, the Administrator shall
reduce the dollar amount of deferrals of Highly Compensated Employees in
descending order, beginning with the Highly Compensated Employee(s) with the
highest total deferral amount until such limitations have been satisfied. In
performing such reduction, the reduced deferral amount of any affected Highly
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Compensated Employee shall, in no event, be lower than that of the Highly
Compensated Employee with the next highest deferral amount.
Any excess Salary Deferral Contributions to be distributed to a Participant
pursuant to this Section shall be reduced by any excess Salary Deferral
Contributions previously distributed to such Participant for such Participant's
taxable year ending with or within the Plan Year in accordance with Code Section
402(g)(2).
Any excess matching contributions for a Plan Year, together with any income
allocable to such excess matching contributions, which are distributable as
described above shall be distributed to a Participant within one (1) year after
the end of such Plan Year. If such excess amounts are not distributed within two
and one-half (2-1/2) months of the end of the Plan Year, a ten percent (10%)
excise tax on such excess amounts shall be imposed on the Company. Excess
matching contributions shall be treated as annual additions under Article 20
hereof.
19.8 Definitions. For purposes of this Article, the following definitions
and special rules shall apply:
(a) "Aggregate Limit" shall mean the greater of (i) or (ii), where:
(i) equals the sum of:
(A) one and twenty-five hundredths (1.25) times the greater
of the Deferral Percentage or the Contribution Percentage for the
Non-Highly Compensated Employees; and
(B) two (2) percentage points plus the lesser of the
Deferral Percentage or the Contribution Percentage for the
Non-Highly Compensated Employees; and
(ii) equals the sum of:
(A) one and twenty-five hundredths (1.25) times the lesser
of the Deferral Percentage or the Contribution Percentage for the
Non-Highly Compensated Employees; and
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(B) two (2) percentage points plus the greater of the
Deferral Percentage or the Contribution Percentage for the
Non-Highly Compensated Employees.
In no event, however, shall the amounts set forth in
subparagraphs (i)(B) and (ii)(B) above exceed twice the greater
of the Deferral Percentage or the Contribution Percentage for the
Non-Highly Compensated Employees.
(b) "Contribution Percentage" shall mean for a Participant for any
Plan Year a fraction:
(i) the numerator of which shall equal matching contributions
made on his behalf; and
(ii) the denominator of which shall equal his Testing
Compensation for such Plan Year;
provided, however, that the Company may elect to take into account
additional contributions pursuant to Section 19.4 hereof. In addition,
"Contribution Percentage" shall mean zero percent (0%) for an Employee
who is eligible to become a Participant but who is not a Participant.
In addition, matching contributions shall be considered to be made on
a Participant's behalf for a Plan Year if such matching contributions
are made as a result of the Participant's Salary Deferral
Contributions, are allocated to the Participant's Matching
Contribution Account during such Plan Year and are paid to this Plan
no later than twelve (12) months after the end of such Plan Year.
(c) "Deferral Percentage" shall mean for a Participant for any Plan
Year a fraction:
(i) the numerator of which shall equal the total of the Salary
Deferral Contributions made on his behalf for such Plan Year; and
(ii) the denominator of which shall equal his Testing
Compensation for such Plan Year;
provided, however, that the Company may elect to take into account
additional contributions pursuant to Section 19.3 hereof. In addition,
"Deferral Percentage" shall mean zero percent (0%) for an Employee who
is eligible to become a Participant but who is not a Participant. In
addition, Salary Deferral Contributions shall be considered to be made
on a Participant's behalf for a Plan Year if such Salary Deferral
Contributions are not
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contingent on participation or performance of services after the end
of such Plan Year, such Salary Deferral Contributions would have been
received (but for the deferral election) within two and one-half
(2-1/2) months after the end of such Plan Year and are paid to this
Plan no later than twelve (12) months after the end of such Plan Year.
(d) "Top Paid Group" shall mean a group consisting of the top paid
twenty percent (20%) of the Employees of a Participating Employer and all
Affiliates ranked on the basis of Testing Compensation from a Participating
Employer and all Affiliates paid during the Plan Year. In determining the
members of the Top Paid Group, the following Employees shall be excluded:
(i) Employees who have not completed six (6) months service;
(ii) Employees who normally work less than seventeen and one-half
(17-1/2) hours per week;
(iii) Employees who normally work during not more than six (6)
months during any year;
(iv) Employees who have not attained age twenty-one (21);
(v) except to the extent provided in regulations, Employees who
are included in a unit of Employees covered by an agreement which the
Secretary of Labor finds to be a collective bargaining agreement
between Employee representatives and a Participating Employer or any
Affiliate; and
(vi) Employees who are nonresident aliens and who receive no
earned income (within the meaning of Section 911(d)(2) of the Code)
from a Participating Employer or any Affiliate which constitutes
income from sources within the United States (within the meaning of
Section 861(a)(3) of the Code).
The Company may elect (in such manner as may be provided by the
Secretary of the Treasury or his delegate) to apply subparagraph
(i), (ii), (iii), or (iv) by substituting a shorter period of
service, smaller number of hours or months, or lower age for the
period of service, number of hours or months, or age (as the case
may be) than that specified in such subparagraph.
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ARTICLE 20
LIMITATION ON ANNUAL ADDITIONS
20.1 Code Section 415 Limitation. Notwithstanding anything contained in
this Plan to the contrary, in no event shall a Participant's annual additions
and annual amount of retirement benefits be greater than the maximum allowable
amounts determined in accordance with Section 415 of the Code, taking into
account (for periods prior to January 1, 2000) paragraph (e) of said Section
415, Section 1106 of the Tax Reform Act of 1986, Section 235(g) of the Tax
Equity and Fiscal Responsibility Act of 1982, Section 2004(d) of ERISA and
Sections 611 and 632 of the Economic Growth and Tax Relief Reconciliation Act of
2001, which are, respectively, incorporated herein by reference.
20.2 Adjustment Under Code Section 415. Adjustment under Section 415 of the
Code shall be made in the following order:
(a) first, annual additions which consist of quarterly employer
contributions shall be reduced;
(b) second, annual additions which consist of matching contributions
shall be reduced; and
(c) third, annual additions which consist of Salary Deferral
Contributions shall be reduced.
20.3 Limitation Year and Compensation. For purposes of calculating the
maximum allowable amounts under Section 20.1 hereof, a Participant's "Limitation
Year" shall mean the calendar year and his compensation shall mean his "Testing
Compensation" as defined in Article 2 hereof and paid and includible in gross
income during the Limitation Year.
20.4 Application of Excess Contributions. In the event that, after the
application of any other provisions of this Plan, there still remain, as a
result of an allocation of forfeitures, a reasonable error in estimating a
Participant's Compensation or other limited facts and circumstances which the
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Commissioner of Internal Revenue finds justify the availability of the rules set
forth in this Section, Participating Employer contributions which, if allocated
to a Participant, would be in excess of the limits on annual additions set forth
in Section 20.1 hereof, such excess shall be used as of the next Allocation Date
and any succeeding Allocation Date, as necessary, to reduce the Participating
Employer contributions which would otherwise be made for such Participant for
the Taxable Years ending on such dates. In the event such Participant is not an
Active Participant on the next Allocation Date, or on any succeeding Allocation
Date on which such excess still remains, such excess shall be used as of such
Allocation Date and on any succeeding Allocation Date to reduce the
Participating Employer contributions for all Participants who are Active
Participants. In the event that Salary Deferral Contributions made by a
terminated Participant are used for the benefit of other Participants after the
Participant terminates employment, the Company shall make a direct payment to
the terminated Participant on whose behalf such Salary Deferral Contributions
were made equal to the total of such amounts.
Until any excess described above is used to reduce Participating Employer
contributions, it shall be held in a suspense account. Such suspense account
shall not be subject to the valuation procedures described in Sections 7.5 and
7.6 hereof. Notwithstanding any other provisions of this Plan to the contrary
(and specifically Section 24.7 hereof), in the event this Plan is terminated at
a time when there are amounts credited to a suspense account pursuant to this
Section, such excess shall be returned to the Company. In the event that amounts
representing Salary Deferral Contributions are returned to the Company
hereunder, the Company shall make payments to the Participants on whose behalf
such Salary Deferral Contributions were made equal to the total of such refunded
amounts.
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ARTICLE 21
ROLLOVERS AND TRANSFERS INVOLVING
OTHER QUALIFIED RETIREMENT PLANS
21.1 Rollovers and Transfers from Other Tax Qualified Plans. In the event
that:
(a) any Covered Employee shall have been a Participant under another
qualified retirement plan which met the requirements of Section 401(a) of
the Code; and
(b) the custodian or trustee of the assets held pursuant to said plan
on behalf of said Covered Employee shall agree to transfer an amount of
cash equal to the value of said assets to the Trustee hereunder; and
(c) the cash to be so transferred shall not be made available to said
Covered Employee in the course of the transfer; and
(d) the Administrator consents to the transfer;
the Trustee hereunder shall accept such transferred cash and hold and administer
it pursuant to the terms and provisions of this Plan and this Article.
Notwithstanding the foregoing, in no event shall any cash be transferred from
another qualified retirement plan to this Plan if the transfer of such cash
would require that the provisions of this Plan governing distributions be
amended to comply with the provisions of Section 401(a)(11) of the Code. Upon
the receipt of said cash, the Trustee shall credit such cash to the Rollover
Account of the Covered Employee on whose behalf the cash was so transferred. If
necessary, the Administrator shall establish a Rollover Account in order to
accomplish the foregoing on behalf of such a Covered Employee.
During the period that a Covered Employee is not a Participant hereunder,
he shall have only those rights hereunder as are necessary to effectuate his
unique status as solely an Accountholder hereunder and permit the proper
administration of this Plan.
21.2 Rollovers and Transfers to Other Tax Qualified Plans. In the event
that:
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(a) any Covered Employee shall terminate his employment and subsequently
become a Participant under the qualified retirement plan of another employer,
which plan satisfies the requirements of Section 401 of the Code;
(b) said former Covered Employee shall have Account balances hereunder
which have not have been distributed to him and which are distributable to him;
(c) said former Covered Employee shall apply to the Administrator hereunder
for transfer to such other plan of assets held pursuant to this Plan
representing his Vested Account Balances;
(d) the assets to be transferred shall not be made available to said former
Covered Employee in the course of the transfer except to the extent permitted by
Section 402(a)(5) of the Code; and
(e) the Administrator shall consent to such transfer;
his Vested Account Balances shall be transferred to the trustee or custodian of
such other qualified retirement plan.
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ARTICLE 22
SPECIAL PROVISIONS WITH RESPECT TO SHARES
22.1 Voting Rights. The Trustee shall vote all Shares held in the Accounts
of Participants, terminated Participants, Beneficiaries and Alternate Payees as
directed by the said Participants, terminated Participants, Beneficiaries and
Alternate Payees. Shares held in Accounts for which no instructions are received
shall be voted by the Trustee in its sole discretion.
22.2 Proxy Materials, etc. In order to implement the voting rights granted
in this Article, the Company or the Trustee shall furnish each affected
individual with proxy solicitation materials or other notices or an information
statement which is distributed to the Company's shareholders, in general,
together with a form requesting confidential instructions as to the manner in
which the Shares held in the individual's Account are to be voted. All such
instructions shall be held in confidence and shall not be divulged to the
Participating Employers, the Company, any subsidiary of the Participating
Employers or the Company, any officer or Employee thereof or any other person.
22.3 Tender Offer. Upon commencement of a tender or exchange offer for
Shares, the Company or the Trustee shall notify each Participant, terminated
Participant, Beneficiary and Alternate Payee for whom an Account is maintained
of such tender offer and utilize its best efforts to timely distribute or cause
to be distributed to such individual such information as is distributed to
shareholders of the Company in connection with such tender or exchange offer,
and shall provide a means by which such individual can instruct the Trustee
whether or not to tender or exchange the Shares credited to his Accounts. The
Company shall provide the Trustee with a copy of any materials provided to
Participants, terminated Participants, Beneficiaries and Alternate Payees.
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22.4 Response to Tender Offer. Each Participant, terminated Participant,
Beneficiary and Alternate Payee shall have the right to instruct the Trustee as
to the manner in which the Trustee is to respond to the tender or exchange offer
with respect to any or all of the Shares allocated to such individual's
Accounts. The Trustee shall respond to the tender or exchange offer with respect
to the Shares as instructed by the Participant, terminated Participant,
Beneficiary or Alternate Payee. All such instructions received by the Trustee
shall be held in confidence and shall not be divulged to the Participating
Employers, the Company, any subsidiary of the Participating Employers or the
Company, any officer or Employee thereof, or any other person. Shares allocated
to a Participant's, terminated Participant's, Beneficiary's or Alternate Payee's
Accounts for which the Trustee has received no instructions from the affected
individual shall be tendered or not by the Trustee in its sole discretion.
22.5 Withdrawal of Tendered Shares. A Participant, terminated Participant,
Beneficiary or Alternate Payee who has directed the Trustee to tender or
exchange Shares allocated to such individual's Accounts may, at any time prior
to the tender or exchange offer withdrawal date, instruct the Trustee to
withdraw, and the Trustee shall withdraw, such Shares from the tender or
exchange offer prior to the withdrawal deadline. The Committee or the Trustee
may impose reasonable limits on the number of instructions to tender or exchange
or withdraw which a Participant, terminated Participant, Beneficiary or
Alternate Payee may give to the Trustee.
22.6 Crediting of Proceeds. The Trustee shall credit the proceeds received
in exchange for tendered or exchanged Shares to the appropriate Accounts of each
Participant, terminated Participant, Beneficiary or Alternate Payee who
instructed the Trustee to so tender or exchange. The Trustee shall exercise its
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best efforts to invest the proceeds, whether cash or securities, from such
tender or exchange in conformity with the requirements of Code Section 4975.
22.7 Put Option Rights. In the event that Shares which are credited to a
Stock Bonus Account are distributed to a Participant, former Participant or
Beneficiary and such Shares are not Publicly Traded or are subject to a Trading
Limitation, the Company shall grant to certain holders of such Shares an option
to require the Company to purchase and redeem such Shares. Such option shall be
granted to such Participant, former Participant or Beneficiary or to any donee
of such Participant, former Participant or Beneficiary or to any person
(including an estate or its distributee) to whom the Shares pass by reason of
such Participant's, former Participant's or Beneficiary's death. Such option
shall be exercisable by notice in writing given to the Company prior to the
later of:
(a) fifteen (15) months after the date on which the distribution of such
Shares is made by this Plan; and
(b) sixty (60) days after the holder of such Shares is notified of the Fair
Market Value of such Shares computed as of the first day of the first Plan Year
commencing more than sixty (60) days after the date of distribution of such
Shares.
Such period of exercise shall be extended by a period of time equal to the
amount of time during which any distributee of this Plan is unable to exercise
the put option provided for herein due to the fact that the Company is
prohibited from honoring such put option obligation by applicable law. If
necessary, the Company shall be required to amend its Certificate of
Incorporation to reduce its stated capital or to make any other changes
necessary to enable distributees to exercise the put option provided for under
this Section. In the event that Shares which are credited to a Stock Bonus
Account are Publicly Traded without restriction when distributed but cease to be
so traded within the period of exercise described above, the Company shall
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notify in writing, on or before the tenth (10th) day after the date the Shares
cease to be Publicly Traded, any stockholder or stockholders who would have been
entitled to exercise the foregoing put option had the Shares not been Publicly
Traded when distributed and shall grant to such stockholder or stockholders a
put option in accordance with this Section for the remainder of the period of
exercise described above. Such notice shall inform such stockholder or
stockholders of the terms of the put option extended to them and, if actually
given later than the tenth (10th) day after the date on which the Shares ceased
to be Publicly Traded, such notice shall provide that the put option shall be
extended beyond the period of exercise by the number of days between such tenth
(10th) day and the date on which notice is actually given. If the foregoing
option is not exercised within the exercise period and any extensions thereof,
it shall lapse.
22.8 Price to be Paid For Shares. The price at which Shares shall be
purchased by the Company pursuant to Section 22.7 hereof shall be equal to their
Fair Market Value. In the case of a transaction between this Plan and a
disqualified person (as defined in Section 4975 of the Code), such price must be
determined as of the date of the transaction. For all other purposes under this
Plan, unless expressly stated otherwise, the Fair Market Value of Shares which
are credited to a Stock Bonus Account may be determined as of the immediately
preceding Allocation Date hereunder.
22.9 Put Option Payment Terms. In the event any put option provided for
pursuant to Section 22.7 hereof is exercised by a Participant, former
Participant or Beneficiary who has received a single distribution of Shares
pursuant to Section 15.2 hereof, payment by the Company pursuant to the exercise
of such option shall be made in substantially equal annual installments over a
period of time beginning no later than thirty (30) days after the option is
exercised and ending no later than five (5) years thereafter. The balance
outstanding at any time with respect to payment by the Company pursuant to the
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exercise of such option shall be adequately secured and bear interest at the
prime rate determined as of the first day of each quarter of the Plan Year but,
in any event, not in excess of the maximum rate permitted by law.
Notwithstanding the foregoing, the Company may, in its discretion, elect to make
such payment in a single lump sum payment within thirty (30) days after the date
on which the option is exercised.
In the event any put option provided for pursuant to Section 22.7 hereof is
exercised by a Participant, former Participant or Beneficiary who is receiving
installment distributions of Shares pursuant to Section 15.2 hereof, payment by
the Company pursuant to the exercise of such option shall be made within thirty
(30) days after the date on which the option is exercised.
22.10 Put Option Conditions. The Company's obligation to pay, in total or
in part, the price for any Shares as to which a put option is exercised pursuant
to this Article shall be conditioned upon:
(a) receipt by the Company of appropriate share certificates duly
endorsed by the person exercising the put option; and
(b) receipt of appropriate assurances that the Shares tendered for
purchase pursuant to the put option are free and clear of any liens,
encumbrances or adverse claims or that such liens, encumbrances or adverse
claims will be paid and satisfied forthwith as a part of such purchase
transaction.
22.11 Restriction on Amendment or Termination of Put Option Rights.
Notwithstanding the provisions of Section 18.1 hereof to the contrary, the
provisions of this Article with respect to the granting and exercise of put
options shall not be amended or terminated in any way which would lessen the
rights of a stockholder holding Shares to which the put option relates or would
relate. In addition, until distributed from this Plan, Shares subject to a put
pursuant to this Article shall not be subject to a put, call, or other option,
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or buy-sell or similar arrangement other than the put option described in
Section 22.7 hereof.
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ARTICLE 23
TOP-HEAVY PROVISIONS
23.1 Special Restrictions. During any Plan Year that this Plan is
Top-Heavy, as determined in accordance with Section 23.2 hereof, the special
restrictions contained in Sections 23.3 and 23.4 hereof shall apply.
23.2 Determination of Top-Heavy Status. This Plan shall be considered to be
"Top-Heavy" in any Plan Year if, as of the Determination Date for such Plan
Year, all the Aggregation Groups of which this Plan is a member are Top-Heavy
Groups. In the event that in any Plan Year this Plan is a member of an
Aggregation Group which is not a Top-Heavy Group, this Plan shall not be
considered to be Top-Heavy for such Plan Year.
For purposes of determining the foregoing, the following terms shall be
defined as follows:
(a) "Determination Date" shall mean for the first Plan Year, its last
day, and shall mean, for any other Plan Year, the last day of the preceding
Plan Year;
(b) "Key Employee" shall mean a "key employee" as described in Section
416(i) of the Code which is hereby incorporated by reference and who is
described for informational purposes herein as:
(i) for Plan Years beginning prior to January 1, 2002, any
Employee, former Employee or Beneficiary who at any time during the
Plan Year or the four (4) preceding Plan Years is:
(A) an officer of a Participating Employer or an Affiliate
having Testing Compensation for the Plan Year of determination
greater than fifty percent (50%) of the amount specified in
Section 415(b)(1)(A) of the Code (plus any increase for
cost-of-living after 1997 as determined from time to time
pursuant to regulations issued by the Secretary of the Treasury
or his delegate pursuant to Section 415(d) of the Code);
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(B) a one-half of one percent (.5%) actual or constructive
owner of a Participating Employer or any Affiliate who owns one
of the ten (10) largest interests in the Participating Employer
or any Affiliate and who is an Employee of the Participating
Employer or an Affiliate having Testing Compensation greater than
Thirty Thousand Dollars ($30,000.00) or, if greater, the amount
specified in Section 415(c)(1)(A) of the Code (plus any increase
for cost-of-living after 1997 as determined from time to time
pursuant to regulations issued by the Secretary of the Treasury
or his delegate pursuant to Section 415(d) of the Code);
(C) a five percent (5%) actual or constructive owner of a
Participating Employer or any Affiliate; or
(D) a one percent (1%) actual or constructive owner of a
Participating Employer or any Affiliate having Testing
Compensation from a Participating Employer and all Affiliates for
the Plan Year of determination greater than One Hundred Fifty
Thousand Dollars ($150,000.00) (plus any increase for
cost-of-living after 1997 as determined from time to time
pursuant to regulations issued by the Secretary of the Treasury
or his delegate);
provided that any such Employee also performed service for a
Participating Employer or an Affiliate during the five (5) Plan Year
period ending on the Determination Date; and provided that an amount
held for the Beneficiary of a Key Employee who is deceased shall be
deemed to be an amount held for a Key Employee; and
(ii) for Plan Years beginning on or after January 1, 2002, any
Employee, former Employee or Beneficiary who at any time during the
Plan Year is:
(A) an officer of a Participating Employer or an Affiliate
having Testing Compensation for the Plan Year of determination
greater than $130,000.00 (plus any increase for cost-of-living
after 2002 as determined from time to time pursuant to
regulations issued by the Secretary of the Treasury or his
delegate) pursuant to Section 415(d) of the Code);
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(B) a five percent (5%) actual or constructive owner of a
Participating Employer or any Affiliate; or
(C) a one percent (1%) actual or constructive owner of a
Participating Employer or any Affiliate having Testing
Compensation from a Participating Employer and all Affiliates for
the Plan Year of determination greater than One Hundred Fifty
Thousand Dollars ($150,000.00);
provided that any such Employee also performed service for a
Participating Employer or an Affiliate during the one (1) Plan Year
period ending on the Determination Date; and provided that an amount
held for the Beneficiary of a Key Employee who is deceased shall be
deemed to be an amount held for a Key Employee;
(c) "Non-Key Employee" shall mean any Employee, former Employee or
Beneficiary who is not a Key Employee including any Employee or Beneficiary
who was formerly a Key Employee;
(d) "Permissive Aggregation Group" shall mean the Required Aggregation
Group plus one (1) or more other plans to which a Participating Employer or
any Affiliate makes contributions which, when considered as a group with
the Required Aggregation Group, would continue to comply with Sections
401(a)(4) and 410 of the Code;
(e) "Required Aggregation Group" shall mean each defined benefit plan
and each defined contribution plan of a Participating Employer or any
Affiliate in which a Key Employee is a Participant in the Plan Year
containing the Determination Date or in any of the four (4) preceding Plan
Years and each other defined benefit plan and each other defined
contribution plan which, during said Plan Years, enables such plans to meet
the requirements of Section 401(a)(4) or 410 of the Code, including for
this purpose each defined benefit plan and each defined contribution plan
of a Participating Employer or any Affiliate which was terminated during
any of said Plan Years;
(f) "Top-Heavy Group" shall mean any Aggregation Group if the sum, as
of the Determination Date, of:
(i) the aggregate value of the Account balances of Key Employees
under all defined contribution plans included in such group; and
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(ii) the present value of the cumulative accrued benefits for Key
Employees under all defined benefit plans included in such group;
exceeds sixty percent (60%) of a similar sum determined for all
Participants, former Participants and Beneficiaries permitted to be
taken into account pursuant to Section 416(g) of the Code, with such
values being determined for each plan as of the most recent Valuation
Date occurring within the twelve (12) month period ending on the
Determination Date and subject to appropriate adjustments under said
Section 416(g) and lawful regulations issued thereunder, including the
requirement that benefits and Accounts of a Participant be increased
by: (A) for Plan Years beginning before January 1, 2002, the aggregate
distributions with respect to such Participant during the five (5)
year period ending on the Determination Date; and (B) for Plan Years
beginning on or after January 1, 2002, the in-service distributions
with respect to such Participant during the five (5) year period
ending on the Determination Date and all other distributions with
respect to such Participant during the one (1) year period ending on
the Determination Date; and
(g) "Valuation Date" shall mean:
(i) in the case of a defined contribution plan, a date as of
which Account balances are valued; and
(ii) in the case of a defined benefit plan, a date as of which
liabilities and assets are valued for computing plan costs for
purposes of determining the plan's minimum funding requirements under
Section 412 of the Code.
In making any of the aforementioned calculations, contributions due but
unpaid as of the Determination Date shall be included in determining the value
of Account balances. In addition, the present value of cumulative accrued
benefits shall be determined as if they accrued no more rapidly than the slowest
rate of accrual permitted under the fractional rule of Section 411(b)(1)(C) of
the Code utilizing the actuarial factors and assumptions set forth in the
defined benefit plans included in the Aggregation Groups. Furthermore, for
purposes of making the aforementioned calculations with respect to defined
benefit plans, proportional subsidies and benefits not relating to retirement
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benefits, such as pre-retirement death and disability benefits and post
retirement medical benefits, are to be disregarded but nonproportional subsidies
are to be taken into account.
23.3 Minimum Contribution. During any Plan Year that this Plan is
Top-Heavy, the Participating Employers shall make a minimum contribution to this
Plan on behalf of each Non-Key Employee who meets all of the following
requirements:
(a) he is not covered by a collective bargaining agreement;
(b) he is a Participant on the last day of such Plan Year or was a
Participant whose employment terminated on or as of said date, irrespective
of whether he has completed one thousand (1,000) Hours for a Participating
Employer or an Affiliate during such Plan Year; and
(c) he is not a Participant in a defined benefit pension plan that
provides him with a minimum accrued benefit (regardless of whether such
accrued benefit is offset by benefits under this Plan) which satisfies the
requirements of Section 416(c)(1) of the Code.
The minimum contribution to be made hereunder for such a Non-Key Employee shall
be an amount, which includes employer matching contributions under Section 6.2
and which, when added to the contributions allocable to such Non-Key Employee
under all other defined contribution plans of a Participating Employer or any
Affiliate shall cause such total contributions to be at least equal to the
lesser of:
(i) three percent (3%) of the Non-Key Employee's Testing
Compensation during the Plan Year; or
(ii) the largest percentage of Testing Compensation provided to
any Key Employee by the contributions of a Participating Employer or
any Affiliate for such Plan Year.
In determining the percentage set forth in subparagraph (ii) above, salary
reduction amounts which are excluded from the taxable income of a Key Employee
under Code Section 402(e)(3) shall be taken into account, but such amounts,
together with any related matching contributions, shall not be taken into
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account with respect to Non-Key Employees in determining compliance with this
Section. Any employer contributions made pursuant to this Section shall be
credited to a Participant's Matching Contribution Account and shall be subject
to the applicable vesting schedule set forth in Section 2.67 hereof. However,
employer contributions made pursuant to Section 12.5 hereof shall not be taken
into account when determining the employer contributions required under this
Section.
23.4 Code Section 415 Limitation. During any Plan Year ending prior to
January 1, 2000 that this Plan is Top-Heavy the limitations on annual additions
and annual benefits under Section 415 of the Code, described in Section 20.1
hereof, shall be reduced as described in Section 416(h) of the Code. The
Participating Employers will not make the additional contributions permitted by
Section 416(h)(2) of the Code to increase the limits under Section 415(e) of the
Code.
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ARTICLE 24
MISCELLANEOUS
24.1 Exclusive Benefit. This Plan has been adopted for the exclusive
benefit of the Participants, their spouses and Beneficiaries. No funds
contributed to or held by the Trustee hereunder shall at any time revert to, or
be used or enjoyed by the Participating Employers, nor shall any such funds or
assets at any time be used other than for the benefit of the Participants, their
spouses or Beneficiaries except as provided in Section 24.7 hereof. Nothing
herein contained shall be construed as giving to any Employee or any other
person any legal or equitable right against the Participating Employers or the
Trustee unless such right shall exist by reason of the express provisions of
this Plan or any action taken pursuant thereto.
24.2 Qualified Military Service. Notwithstanding any provision of this Plan
to the contrary, contributions, benefits and service credit with respect to
qualified Military Service will be provided in accordance with Section 414(u) of
the Code. In addition, loan repayments will be suspended under Article 11 hereof
as permitted under Section 414(u)(4) of the Code.
24.3 Insurance Company. No insurance company shall be deemed to be a party
to this Plan for any purpose, nor shall it be responsible for the validity of
this Plan. No such company shall be required to look into the terms of this Plan
or question any action of the Trustee or Administrator hereunder, nor be
responsible to see that any action of the Trustee or Administrator is authorized
by the terms of this Plan. Any such insurance company shall be fully discharged
from any and all liability for any amount paid to the Trustee or paid in
accordance with the direction of the Administrator, or for any change made or
action taken by such insurance company upon such direction, and no insurance
company shall be obligated to see to the distribution or further application of
any moneys so paid by it. The certificate of the Administrator may be received
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by any insurance company as conclusive evidence of any of the matters mentioned
in this Plan, and each insurance company shall be fully protected in taking or
permitting any action on the faith thereof and shall incur no liability or
responsibility for doing so.
24.4 Bankruptcy or Insolvency. In the event a Participating Employer shall
at any time be judicially declared bankrupt or insolvent, or in the event of its
dissolution, merger or consolidation without any provisions being made for the
continuation of this Plan with respect to its employees, the Plan created
hereunder shall terminate with respect to such Participating Employer and the
Trustee shall make distributions as provided in Section 18.2 hereof.
24.5 Merger, Consolidation or Transfer of Assets and Liabilities. In the
event this Plan shall merge or consolidate with, or transfer any of its assets
or liabilities to any other plan, each Participant shall be entitled to receive,
if this Plan were terminated immediately thereafter, a benefit which is 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,
in accordance with Section 414(l) of the Code and Section 208 of ERISA.
24.6 No Employment Rights Created. Neither anything contained herein, nor
any contribution made hereunder, nor any other acts done in pursuance of this
Plan, shall be construed as entitling any Participant to be continued in the
employ of a Participating Employer or any Affiliate for any period of time nor
as obliging the a Participating Employer or any Affiliate to keep any
Participant in its employ for any period of time, nor shall any Employee of a
Participating Employer or any Affiliate nor anyone else have any rights
whatsoever, legal or equitable, against the Participating Employers or the
Trustee as a result of this Plan except those expressly granted to him
hereunder.
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24.7 Return of Participating Employer Contributions. No contributions or
payments by the Participating Employers to the Trustee of this Plan, nor any
income of the Trust Fund, shall in any event revert or be credited to or be used
for the benefit of the Participating Employers, and all such contributions,
payments and income shall be used solely and exclusively for the benefit of the
Participants and their Beneficiaries under this Plan, except that the Trustee
shall return to the Participating Employers upon written request of the Company:
(a) any contributions made by a Participating Employer by a mistake of
fact, provided such contributions are returned to the Participating
Employer within one (1) year after the date such contributions were made;
(b) any contributions made for Plan Years during which this Plan did
not initially qualify under Section 401(a) of the Code, provided such
contributions are returned to the Participating Employers within one (1)
year after the date of denial of qualification, but only if an application
for determination was made with the Internal Revenue Service by the time
prescribed by law for filing the original sponsor's tax return for the
Taxable Year in which this Plan was adopted, or on such later date as the
Secretary of the Treasury may prescribe; and
(c) any contributions, to the extent that their deduction is
disallowed under Section 404 of the Code, provided that such disallowed
contributions are returned to the Participating Employers within one (1)
year after the disallowance of the deduction.
In the event that amounts representing Salary Deferral Contributions are
returned to the Participating Employers pursuant to the provisions of this
Section hereof, the Participating Employers shall make payments to the
Participants on whose behalf such Salary Deferral Contributions were made equal
to the total of such refunded amounts.
24.8 Spousal Consent. Notwithstanding any provision of this Plan to the
contrary, the Administrator, where required by law or where it deems appropriate
in its sole discretion, may require spousal consent for any actions taken,
elections made, or the exercise of any rights by a married Participant under
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this Plan. Any consent by a spouse pursuant to this Section shall be made in
accordance with Section 24.9 hereof.
24.9 Form of Spousal Consent. If any provision of this Plan shall require
the consent of the spouse of a Participant, such consent shall be in writing
with the signature of the spouse notarized. Notwithstanding any provision hereof
to the contrary, the consent of the spouse shall not be necessary if it is
established to the satisfaction of the Administrator that the signature of the
spouse cannot be obtained either because the spouse cannot be located or because
of such other circumstances as the Secretary of the Treasury may prescribe by
lawful regulations. Any consent given by a spouse pursuant to this Section shall
be effective only with respect to such spouse and shall not be effective with
respect to any other spouse of such Participant.
24.10 Receipts and Releases. Any payment to any Participant, or
Beneficiary, or to his legal representative or spouse, in accordance with the
provisions of this Plan, shall to the extent thereof be in full satisfaction of
all claims hereunder against the Administrator and the Participating Employers,
any of whom may require such Participant, Beneficiary, legal representative or
spouse, as a condition precedent to such payment, to execute a receipt and
release therefor in such form as shall be determined by the Administrator or the
Participating Employer, as the case may be.
24.11 Savings Clause. If any provision of this Plan is held invalid or
unenforceable, such invalidity or unenforceability shall not affect any other
provisions, and this Plan shall be construed and enforced as if such provision
had not been included.
24.12 Compliance with ERISA. All provisions of this Plan shall be
interpreted and administered in accordance with the provisions of ERISA, and
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Section 401(a) of the Code and any successor section or sections, in a
non-discriminatory manner and in a manner which will assure compliance of the
Plan's operation therewith. Employees and Beneficiaries of Employees in similar
circumstances shall receive uniform, consistent and non-discriminatory treatment
hereunder.
24.13 Impossibility of Performance. In the event that it becomes impossible
for a Participating Employer, the Administrator or the Committee to perform any
act under this Plan, that act shall be performed which, in the judgment of the
Participating Employer, Administrator or Committee, as the case may be, will
most nearly carry out the intent and purpose of this Plan.
24.14 Singular-Plural. The singular herein shall include the plural, or
vice versa, wherever the context so requires.
24.15 Gender. Whenever any pronoun is used herein, it shall be construed to
include the masculine pronoun, the feminine pronoun or the neuter pronoun as
shall be appropriate.
24.16 Applicable Law. This Plan shall be construed under and in accordance
with the laws of the State of Ohio and of the United States of America.
24.17 Retroactive Amendment. This Plan may be modified and amended
retroactively, if necessary, to secure exemption under Section 401(a) of the
Code.
24.18 Applicability of Amendments Generally and to Participants Who
Terminated Employment Prior to the Amendment Date or Effective Date. This
restatement is generally effective January 1, 2001, but also reflects certain
changes which apply to earlier dates. Except as otherwise provided herein, the
terms and provisions of this restatement, and any other amendments to this Plan,
apply with respect to the operation of the Plan and all rights, obligations and
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transactions hereunder on and after their effective dates. However, with respect
to a Participant who retired, terminated employment or otherwise ceased to be a
Covered Employee prior to the effective date of a change to this Plan, or to any
person claiming benefits hereunder relating to such a Participant, in general:
(a) such change shall be applicable to such Participant or person to
the extent such change relates to administrative procedures or the powers
of the Company or Administrator, or if the Code, ERISA or other relevant
law requires such change to apply to such Participants and persons; and
(b) such change shall be not be applicable to such Participant or
person if the change relates to any other items, including but not limited
to an increase in the benefit which would be payable to such person, the
vesting of such benefit, or the distribution rights or options related
thereto.
Notwithstanding the foregoing, where the provisions of this Plan specify the
extent to which any such change shall be effective, such provisions shall
govern.
24.19 Elimination of Family Aggregation Rules. Effective January 1, 1997,
the family aggregation rules required by Sections 414(q)(6) and 401(a)(17)(A) of
the Code which required certain Participants, the spouses of such Participants,
and any lineal descendants who have not attained age nineteen (19) before the
close of the Plan Year to be treated as a single Participant for purposes of
applying the limitation on Compensation for a Plan Year shall not apply to the
Plan. On and after January 1, 1997, the spouses of such Participants and any
lineal descendants (including those descendants who have not attained age
nineteen (19) before the close of the Plan Year) will be treated as separate
Participants for purposes of applying the limitation on Compensation for a Plan
Year.
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IN WITNESS WHEREOF, INVACARE CORPORATION. by its appropriate officers duly
authorized, has caused this Amendment and Restatement of the Plan to be executed
as of the 9th day of October, 2002.
INVACARE CORPORATION
("Company")
By /s/ A.Malachi Mixon, III
And /s/ Gerald B. Blouch