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EXHIBIT 10.26
RETAIL MERCHANDISING SERVICE AUTOMATION, INC.
EMPLOYEE STOCK OWNERSHIP PLAN
JULY 1, 1994 RESTATEMENT
(INCLUDES FIRST THROUGH FOURTH AMENDMENTS)
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TABLE OF CONTENTS
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ARTICLE I................................................................................. 1
NAME, EFFECTIVE DATE, AND PURPOSES........................................................ 1
1.1 Plan Name and Effective Date............................................. 1
1.2 Plan Purposes............................................................ 1
1.3 Plan Intended to Qualify as ESOP......................................... 2
1.4 Leveraged Transactions................................................... 2
ARTICLE II................................................................................ 3
DEFINITIONS............................................................................... 3
2.1 Accounts................................................................. 3
2.2 Reserved for Plan Modifications.......................................... 3
2.3 Reserved for Plan Modifications.......................................... 3
2.4 Affiliated Company....................................................... 3
2.5 Anniversary Date......................................................... 4
2.6 Applicable Valuation Date................................................ 4
2.7 Beneficiary.............................................................. 4
2.8 Board of Directors....................................................... 4
2.9 Break in Service......................................................... 4
2.10 Code.................................................................... 4
2.11 Committee................................................................ 4
2.12 Company.................................................................. 4
2.13 Company Contributions.................................................... 5
2.14 Company Stock............................................................ 5
2.15 Compensation............................................................. 5
2.16 Computation Period....................................................... 6
2.17 Reserved for Plan Modifications.......................................... 7
2.18 Current Obligations...................................................... 7
2.19 Disability............................................................... 7
2.20 Reserved for Plan Modifications.......................................... 7
2.21 Effective Date........................................................... 7
2.22 Eligibility Date......................................................... 7
2.23 Eligible Employee........................................................ 7
2.24 Reserved for Plan Modifications.......................................... 8
2.25 Employee................................................................. 8
2.26 Employment Commencement Date............................................. 8
2.27 ERISA.................................................................... 8
2.28 Forfeitures.............................................................. 8
2.29 Freely Tradeable Stock................................................... 8
2.30 Hour of Service.......................................................... 9
2.31 Investment Manager....................................................... 10
2.32 Leave of Absence......................................................... 11
2.33 Leveraged Company Stock.................................................. 13
2.34 Limitation Year.......................................................... 13
2.35 Normal Retirement Date................................................... 13
2.36 Participant.............................................................. 13
2.37 Participation Commencement Date.......................................... 13
2.38 Reserved for Plan Modifications.......................................... 13
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2.39 Reserved for Plan Modifications.......................................... 13
2.40 Plan..................................................................... 13
2.41 Plan Administrator....................................................... 13
2.42 Plan Representative...................................................... 14
2.43 Plan Year................................................................ 14
2.44 Reserved for Plan Modifications.......................................... 14
2.45 Reemployment Commencement Date........................................... 14
2.46 Severance................................................................ 14
2.47 Reserved for Plan Modification........................................... 14
2.48 Special Suspense Account................................................. 14
2.49 Spouse................................................................... 14
2.50 Suspense Account......................................................... 15
2.51 Trust and Trust Fund..................................................... 15
2.52 Trustee.................................................................. 15
2.53 Valuation Date........................................................... 15
2.54 Vested Interest.......................................................... 15
2.55 Year of Service.......................................................... 15
ARTICLE III............................................................................... 17
ELIGIBILITY AND PARTICIPATION............................................................. 17
3.1 Eligibility to Participate............................................... 17
3.2 Automatic Enrollment and Commencement of Participation:.................. 17
ARTICLE IV................................................................................ 19
TRUST FUND AND CONTRIBUTIONS.............................................................. 19
4.1 Trust Fund............................................................... 19
4.2 Company Contributions.................................................... 19
4.3 Rules Applicable to Company Contributions................................ 19
4.4 Initial Valuation of Company Contributions............................... 20
4.5 Investment and Application of Company Contributions...................... 20
4.6 Irrevocability........................................................... 21
4.7 Company Not Obligated to Continue Contributions.......................... 21
4.8 Company, Committee and Trustee Not Responsible for Adequacy of Trust
Fund..................................................................... 22
ARTICLE V................................................................................. 23
PARTICIPANT CONTRIBUTIONS................................................................. 23
5.1 No Participant Contributions............................................. 23
ARTICLE VI................................................................................ 24
PARTICIPANT ACCOUNTS AND ALLOCATIONS...................................................... 24
6.1 General.................................................................. 24
6.2 Participants' Accounts................................................... 24
6.3 Company Stock Account.................................................... 24
6.4 Other Investments Account................................................ 25
6.5 Allocations of Company Contributions and Forfeitures..................... 26
6.6 Revaluation of Accounts and Allocations of Trust Fund Income............. 27
6.7 Cash Dividends........................................................... 28
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6.8 Forfeitures.............................................................. 29
6.9 Stock Dividends, Splits, Recapitalizations, Etc.......................... 30
6.10 Stock Rights, Warrants or Options........................................ 30
6.11 Notice of Allocations.................................................... 31
6.12 Notice of Value of Company Stock......................................... 31
6.13 Treatment of Accounts Upon Severance..................................... 32
6.14 Miscellaneous Allocation Rules........................................... 32
6.15 Allocation of Company stock Attributable to Code Section 1042............ 32
6.16 Special Distribution Rule................................................ 35
ARTICLE VII............................................................................... 37
VESTING IN PLAN ACCOUNTS.................................................................. 37
7.1 No Vested Rights Except as Herein Specified.............................. 37
7.2 Vesting Schedule......................................................... 37
7.3 Special Vesting Rules.................................................... 37
7.4 Change in Vesting Schedule............................................... 38
ARTICLE VIII.............................................................................. 40
PAYMENT OF PLAN BENEFITS.................................................................. 40
8.1 Retirement............................................................... 40
8.2 Method of Distribution Upon Retirement................................... 40
8.3 Disability Prior to Termination of Employment............................ 40
8.4 Distributions Upon Death................................................. 40
8.5 Designation of Beneficiary............................................... 41
8.6 Irrevocability of Spousal Consents....................................... 43
8.7 Distribution on Severance Prior to Normal Retirement Date................ 43
8.8 Forfeitures; Restoration................................................. 45
8.9 Timing of Benefit Payments............................................... 46
8.10 Form of Distributions.................................................... 46
8.11 Required Payment Dates................................................... 47
8.12 Payees Under Legal Disabilities.......................................... 48
8.13 Additional Documents..................................................... 48
8.14 Limited Option to Sell Distributed Company Stock......................... 48
8.15 Transfer of Distributed Company Stock--Right of First Refusal for the
Company and the Plan..................................................... 52
8.16 Election for Direct Rollover of Vested Interest to Eligible
Retirement Plan.......................................................... 54
ARTICLE IX................................................................................ 56
OPERATION AND ADMINISTRATION OF THE PLAN.................................................. 56
9.1 Plan Administration...................................................... 56
9.2 Committee Powers......................................................... 56
9.3 Investment Manager....................................................... 58
9.4 Funding Policy........................................................... 58
9.5 Committee Procedure...................................................... 58
9.6 Compensation of Committee and Plan Expenses.............................. 59
9.7 Resignation and Removal of Members....................................... 60
9.8 Appointment of Successors................................................ 60
9.9 Records.................................................................. 60
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9.10 Reliance Upon Documents and Opinions..................................... 61
9.11 Requirement of Proof..................................................... 61
9.12 Reliance on Committee Memorandum......................................... 61
9.13 Multiple Fiduciary Capacity.............................................. 62
9.14 Limitation on Liability.................................................. 62
9.15 Indemnification.......................................................... 62
9.16 Bonding.................................................................. 62
9.17 Allocation of Fiduciary Responsibility................................... 62
9.18 Voting and Other Rights of Company Stock................................. 63
9.19 Prohibition Against Certain Actions...................................... 64
ARTICLE X................................................................................. 66
LEVERAGED COMPANY STOCK ACQUISITIONS...................................................... 66
10.1 Leveraged Company Stock Acquisitions Authorized.......................... 66
10.2 Company Contributions for Leveraged Transactions......................... 69
10.3 Valuation of Leveraged Company Stock..................................... 70
10.4 Suspense Account......................................................... 71
10.5 Release and Allocation of Leveraged Company Stock........................ 71
10.6 Certain Nonterminable Provisions......................................... 72
ARTICLE XI................................................................................ 73
MERGER OF COMPANY; MERGER OF PLAN......................................................... 73
11.1 Effect of Reorganization or Transfer of Assets........................... 73
11.2 Merger Restriction....................................................... 73
ARTICLE XII............................................................................... 74
PLAN TERMINATION AND DISCONTINUANCE OF CONTRIBUTIONS...................................... 74
12.1 Plan Termination......................................................... 74
12.2 Discontinuance of Contributions.......................................... 74
12.3 Rights of Participants................................................... 75
12.4 Trustee's Duties on Termination.......................................... 75
12.5 Partial Termination...................................................... 76
ARTICLE XIII.............................................................................. 77
APPLICATION FOR BENEFITS.................................................................. 77
13.1 Application for Benefits................................................. 77
13.2 Action on Application.................................................... 77
13.3 Appeals.................................................................. 78
13.4 No Effect on Timing of Distributions..................................... 78
ARTICLE XIV............................................................................... 79
LIMITATIONS ON CONTRIBUTIONS.............................................................. 79
14.1 Basic Limitation......................................................... 79
14.2 Annual Additions......................................................... 79
l4.3 Membership in Other Defined Contribution Plans........................... 81
l4.4 Membership in Defined Benefit Plans...................................... 81
14.5 Adjustments For Excess Annual Additions.................................. 83
ARTICLE XV................................................................................ 86
RESTRICTION ON ASSIGNMENT OR OTHER ALIENATION OF PLAN BENEFITS............................ 86
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15.1 General Restrictions Against Alienation.................................. 86
15.2 Qualified Domestic Relations Orders...................................... 86
15.3 No Loans to Participants................................................. 89
ARTICLE XVI............................................................................... 90
TOP-HEAVY PLAN RULES...................................................................... 90
16.1 Applicability............................................................ 90
16.2 Definitions.............................................................. 90
16.3 Top-Heavy Status......................................................... 92
16.4 Minimum Contributions.................................................... 93
16.5 Compensation Limitation.................................................. 94
16.6 Maximum Annual Addition.................................................. 94
16.7 Minimum Vesting Rules.................................................... 95
16.8 Non-Eligible Employees................................................... 95
ARTICLE XVII.............................................................................. 96
PLAN AMENDMENTS........................................................................... 96
17.1 Amendments............................................................... 96
17.2 Retroactive Amendments................................................... 96
ARTICLE XVIII............................................................................. 97
MISCELLANEOUS............................................................................. 97
18.1 No Enlargement of Employee Rights........................................ 97
18.2 Mailing of Payments; Lapsed Benefits..................................... 97
18.3 Addresses................................................................ 98
18.4 Notices and Communications............................................... 98
18.5 Reporting and Disclosure................................................. 99
18.6 Governing Law............................................................ 99
18.7 Reserved for Plan Modifications.......................................... 99
18.8 Interpretation........................................................... 99
18.9 Withholding For Taxes.................................................... 100
18.10 Counterparts............................................................. 100
18.11 Successors and Assigns................................................... 100
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RETAIL MERCHANDISING SERVICE AUTOMATION, INC.
EMPLOYEE STOCK OWNERSHIP PLAN
ARTICLE I
NAME, EFFECTIVE DATE, AND PURPOSES
1.1 PLAN NAME AND EFFECTIVE DATE.
This document, made and entered into by Retail Merchandising
Service Automation, Inc., a Delaware corporation (the "Company"), evidences the
terms of the employee stock ownership plan for qualified Employees of the
Company and its subsidiaries known as the "Retail Merchandising Service
Automation, Inc. Employee Stock Ownership Plan" (the "Plan") as in effect as of
July 1, 1994 (the "July 1, 1994 Restatement"), unless otherwise expressly
provided herein. The effective dates of the changes made by this July 1, 1994
Restatement are as provided in the Fourth Amendment. The original Effective Date
of the Plan was July 1, 1985.
The provisions of this amended and restated Plan are not intended
to enlarge the rights of any Employee who terminated employment prior to July 1,
1994, unless otherwise expressly stated in the First through Fourth Amendments.
The rights and benefits, if any, of Employees who terminated their employment
prior to July 1, 1994 shall be determined in accordance with the provisions of
the Plan as in effect at the date of their termination. A similar rule shall
apply to Beneficiaries of Participants whose deaths occurred prior to July 1,
1994.
1.2 PLAN PURPOSES.
The purpose of this Plan is to enable participating Employees of
the Company, and any Affiliated Companies that are authorized by the Board of
Directors to participate in the Plan, to share in the growth and prosperity of
the Company and to provide Participants with an opportunity to accumulate
capital for their future economic security. The Plan is designed to do this
without any deductions from Participants' paychecks and without calling upon
them to invest their personal savings. The Plan is designed to accomplish these
objectives principally by enabling Participants to acquire a proprietary
interest in the Company. Consequently, the Company Contributions made to the
Trust established under this Plan are intended to be invested primarily or
exclusively in Company Stock in accordance with the investment guidelines
provided in Article IV. All assets acquired under this Plan
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as a result of Company Contributions, income and other additions to the Trust
will be administered, distributed, forfeited and otherwise governed by the
provisions of this Plan, which is to be administered by the Committee for the
exclusive benefit of the Participants and their Beneficiaries.
1.3 PLAN INTENDED TO QUALIFY AS ESOP.
This Plan is an employee benefit plan that is intended to qualify
under Code Section 401(a) as a stock bonus plan that satisfies the requirements
for an "Employee Stock Ownership Plan" ("ESOP"), as defined under Code Section
4975(e)(7), and also qualifies for the prohibited transaction exemption provided
under Code Section 4975(d)(3).
1.4 LEVERAGED TRANSACTIONS.
In implementing the purposes of this Plan as described in Section
1.2 above, at the direction of the Committee the Plan may (but need not) borrow
money (or receive other extensions of credit) to acquire Company Stock,
including borrowing or otherwise obtaining credit from the Company and/or other
parties constituting "disqualified persons" within the meaning of Code Section
4975(e)(2). Such loans (or credit) shall be secured primarily through a binding
commitment by the Company to pay contributions to the Trust in amounts
sufficient to enable the loans to be repaid.
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ARTICLE II
DEFINITIONS
2.1 ACCOUNTS.
"Accounts" or "Participant's Accounts" shall mean the following
Plan accounts maintained by the Committee for each Participant as required by
Article VI:
(a) "Company Stock Account" shall mean the account
established and maintained for each Participant under Sections 6.2 and
6.3 for purposes of holding and accounting for Company Stock allocated
to such Participant.
(b) "Other Investments Account" shall mean the account
established and maintained for each Participant under Sections 6.2 and
6.4 for purposes of holding and accounting for assets other than Company
Stock allocated to such Participant.
2.2 RESERVED FOR PLAN MODIFICATIONS.
2.3 RESERVED FOR PLAN MODIFICATIONS.
2.4 AFFILIATED COMPANY.
"Affiliated Company" shall mean:
(a) any corporation that is included in a controlled group
of corporations, within the meaning of Section 414(b) of the Code, of
which group the Company is also a member,
(b) any trade or business that is under common control
with the Company within the meaning of Section 414(c) of the Code,
(c) any service organization that is included in an
affiliated service group, within the meaning of Section 414(m) of the
Code, of which affiliated service group the Company is also a member,
and
(d) any other entity required to be aggregated with the
Company pursuant to regulations under Section 414(o) of the Code.
For purposes of Article XIV, whether or not an entity is an Affiliated Company
shall be determined after applying the percentage modifications contained in
Code Section 415(h).
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2.5 ANNIVERSARY DATE.
"Anniversary Date" shall mean the last day of each Plan Year.
2.6 APPLICABLE VALUATION DATE.
"Applicable Valuation Date" shall mean the most recent date on
which the Trust Assets were valued, determined in accordance with the rules of
Section 6.6.
2.7 BENEFICIARY.
"Beneficiary" shall mean the person or persons determined in
accordance with Section 8.5 who are entitled to benefits under the Plan upon the
death of a Participant.
2.8 BOARD OF DIRECTORS.
"Board of Directors" or "Board" shall mean the Board of Directors
of Retail Merchandising Service Automation, Inc.
2.9 BREAK IN SERVICE.
"Break in Service" or "Break" shall mean, with respect to any
Employee, a Computation Period during which such Employee does not complete more
than 500 Hours of Service; provided, however, that in the case of a Participant
who is absent by reason of a Maternity or Paternity Leave, the provisions of
Section 2.32(b)-(f) shall apply for purposes of determining whether such
Participant has incurred a Break in Service by reason of such Leave.
2.10 CODE.
"Code" shall mean the Internal Revenue Code of 1986, and the
regulations thereunder. Reference to a specific Section of the Code shall
include any comparable provisions of future legislation that amend, supplement
or supersede that specific Section.
2.11 COMMITTEE.
"Committee" shall mean the Retail Merchandising Service
Automation, Inc. Employee Stock Ownership Plan Committee described in Article
IX.
2.12 COMPANY.
"Company" shall mean, unless the context indicates otherwise,
Retail Merchandising Service Automation, Inc. and also any Affiliated Companies
of Retail Merchandising Service
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Automation, Inc. which may be included within the coverage of the Plan with the
consent of the Board of Directors.
2.13 COMPANY CONTRIBUTIONS.
"Company Contributions" shall mean all amounts (whether in cash
or other property, including Company Stock) paid by the Company into the Trust
Fund established and maintained under the provisions of this Plan for the
purpose of providing benefits for Participants and their Beneficiaries.
2.14 COMPANY STOCK.
"Company Stock" shall mean whichever of the following is
applicable:
(a) So long as the Company has only one authorized class
of stock, that class of stock.
(b) In the event the Company at any time has more than one
authorized class of stock, the class (or classes) of the Company's stock
that constitutes "employer securities" as that term is defined in
Section 409(l) of the Code.
2.15 COMPENSATION.
(a) Except as otherwise provided in this Section,
"Compensation" shall mean "wages" within the meaning of Internal Revenue
Code Section 3401(a) (pertaining to federal income tax withholding at
the source) with respect to employment by the company for services
performed as an Eligible Employee, but determined without regard to any
rules that limit the remuneration included in wages based on the nature
or location of the employment or the services performed (such as the
exception for agricultural labor in Code Section 3401(a)(2)). Except for
purposes of applying the provisions of the limitations set forth in
Article XVI of this Plan (pertaining to the rules of Section 415 of the
Code), "Compensation" also shall include amounts that would otherwise
have been included in the definition of "Compensation" but for an
employee's election to enter into a wage or salary reduction agreement
pursuant to a plan qualifying under Code Section 125.
(b) For purposes of applying the provisions of Articles
XIV and XVI a Participant's compensation shall be determined pursuant to
the definition of "compensation" as set forth in Section 14.1(b) or
16.2(i), whichever shall be applicable.
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(c) "Compensation" of any Employee taken into account
under Article VI for any Plan Year that begins on or after January 1,
1989 shall not exceed the annual compensation limit in effect under
Section 401(a)(17) of the Code on the January 1 coinciding with or
immediately preceding the first day of such Plan Year, as provided in
this Subsection.
(i) "Compensation" of any Employee taken into
account under Article VI for any Plan Year that begins on or
after January 1, 1994 shall not exceed $150,000, as that amount
is adjusted in accordance with Section 401(a)(17)(B) of the Code.
(ii) "Compensation" of any Employee taken into
account under Article VI for any Plan Year that begins on or
after January 1, 1989 and before January 1, 1994, shall not
exceed $200,000, as that amount is adjusted at the same time and
in the same manner as under Section 415(d) of the Code.
(iii) If Compensation for a period of less than
twelve (12) months is taken into account for any Plan Year, then,
to the extent required by regulations under Section 401(a)(17) of
the Code, the otherwise applicable annual Compensation limit
provided under this Subsection is reduced in the same proportion
as the reduction in the twelve-month period.
(iv) The family aggregation rules of Section
414(q)(6) of the Code shall apply for purposes of the annual
Compensation limit provided under this Subsection, except in
applying such rules, the term "family" shall include only the
Spouse of the Employee and any lineal descendants of the Employee
who have not attained age 19 before the close of the year. If, as
a result of the application of such rules the limit is exceeded,
then, the limit shall be prorated among the affected individuals
in proportion to each such individual's Compensation as
determined under this Subsection prior to the application of this
limit.
2.16 COMPUTATION PERIOD.
"Computation Period" shall mean, with respect to each Employee,
the 12 month period used under this Plan for determining an Employee's
eligibility to participate in this Plan, and his Years of Service under this
Plan. For purposes of determining an Employee's eligibility to participate in
this Plan pursuant to the provisions of Article III, the Computation Period
("Eligibility Computation Period") shall be
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both (a) the Plan Year and (b) the 12 consecutive month period beginning on the
Employee's Employment Commencement Date or Reemployment Commencement Date,
whichever shall be applicable. For purposes of determining an Employee's Vested
Interest in his Plan Accounts pursuant to the provisions of Article VII, the
Computation Period ("Vesting Computation Period") shall be the Plan Year.
2.17 RESERVED FOR PLAN MODIFICATIONS.
2.18 CURRENT OBLIGATIONS.
"Current Obligations" shall mean obligations of the Trust arising
from extensions of credit to the Trust in connection with the purchase by the
Trust of Leveraged Company Stock which are either:
(a) Payable in cash within one year from the date of
reference pursuant to the terms of the applicable credit agreement; or
(b) Specified by the Company as subject to current payment
with Trust assets available therefor pursuant to the terms of this Plan.
2.19 DISABILITY.
"Disability" shall mean the mental or physical inability of the
Participant to perform his normal job as evidenced by the certificate of a
medical examiner satisfactory to the Company certifying the inability and
certifying that such condition is likely to be permanent. The determination by
the Committee, based upon the opinion of the physician selected, as to whether a
Participant has incurred a Disability shall be final and binding upon all
persons.
2.20 RESERVED FOR PLAN MODIFICATIONS.
2.21 EFFECTIVE DATE.
"Effective Date" shall mean July 1, 1985, which shall be the
original effective date of this Plan.
2.22 ELIGIBILITY DATE.
"Eligibility Date" shall mean the first day on which an Employee
has satisfied the participation eligibility requirements of this Plan as set
forth in Section 3.1.
2.23 ELIGIBLE EMPLOYEE.
"Eligible Employee" shall mean every Employee of the Company
except (a) Employees who are members of a collective
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bargaining unit and who are covered by a collective bargaining agreement which
does not specifically provide for coverage of such Employees under this Plan,
and (b) "leased employees," within the meaning of Code Section 414(n).
2.24 RESERVED FOR PLAN MODIFICATIONS.
2.25 EMPLOYEE.
"Employee" shall mean each person currently employed in any
capacity by the Company any portion of whose income is subject to withholding of
income tax and/or for whom Social Security contributions are made by the
Company, as well as any other person qualifying as a common law employee of the
Company. The term "Employee" shall also mean a person deemed to be employed by
the Company pursuant to Code Section 414(n). Although Eligible Employees are the
only class of Employees eligible to participate in this Plan, the term
"Employee" is used to refer to persons employed in a non-Eligible Employee
capacity as well as Eligible Employee category. Thus, those provisions of this
Plan that are not limited to Eligible Employees, such as those relating to Years
of Service, apply to both Eligible and non-Eligible Employees.
2.26 EMPLOYMENT COMMENCEMENT DATE.
The term "Employment Commencement Date" shall mean the date on
which an Employee first performs an Hour of Service in any capacity for the
Company or any Affiliated Company. Except as is expressly provided otherwise in
this Plan or in resolutions of the Board of Directors, an Employee shall not,
for the purposes of determining his Employment Commencement Date, be deemed to
have commenced employment with an Affiliated Company prior to the date on which
the entity became an Affiliated Company.
2.27 ERISA.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974 and all amendments thereto and regulations thereunder.
2.28 FORFEITURES.
"Forfeitures" shall mean the nonvested portion of a Participant's
interest in the Plan that is forfeited in accordance with the rules of Articles
VII and VIII.
2.29 FREELY TRADEABLE STOCK.
"Freely Tradeable Stock" shall mean Company Stock that, at the
time of reference, (a) is "publicly traded" as that term is defined under
Treasury Regulation
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Section 54.4975-7(b)(1)(iv) or any successor regulation thereto, and (b) is not
subject to a "trading limitation" as that term is defined under Treasury
Regulation Section 54.4975-7(b)(10) or any successor regulation thereto.
2.30 HOUR OF SERVICE.
(a) "Hour of Service" of an Employee shall mean the
following:
(i) Each hour for which the Employee is paid, or
entitled to payment, by the Company or an Affiliated Company for
the performance of services as an Employee.
(ii) Each hour in or attributable to a period of
time during which the Employee performs no duties (irrespective
of whether he has terminated his employment with the Company) due
to a vacation, holiday, illness, incapacity (including pregnancy
or disability), lay-off, jury duty, military duty, or a Leave of
Absence, for which he is paid or entitled to payment, whether
direct or indirect; provided, however, no such hour shall be
credited to an Employee if such Employee is directly or
indirectly paid or entitled to payment for such hour under a plan
maintained solely for the purpose of complying with applicable
workers' compensation, unemployment compensation, or disability
insurance laws, or is a payment which solely reimburses the
Employee for medical or medically-related expenses incurred by
him.
(iii) Each hour for which the Employee is entitled
to back pay, irrespective of mitigation of damages, whether
awarded or agreed to by the Company or an Affiliated Company,
provided that such Employee has not previously been credited with
an Hour of Service with respect to such hour under Subparagraphs
(i) or (ii) above.
(iv) Notwithstanding the foregoing, no Employee
shall be entitled to credit for more than 501 Hours of Service
for any single continuous period during which the Employee
performs no duties, whether or not such period occurs in a single
Computation Period.
(b) All Hours of Service determined under the rules of
Paragraph (a) shall be credited to the Computation Period during which
the employment or compensated absence occurred, rather than to the
Computation Period in which the payment occurred.
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(c) In the event that adequate records are not
maintained with respect to the actual number of hours of work performed
by any Employee, such Employee shall be deemed to have completed 45
Hours of Service for each week or portion thereof during which he
performed duties for the Company or an Affiliated Company.
(d) Unless the Board of Directors shall expressly
determine otherwise, and except as may be expressly provided otherwise
in this Plan, an Employee shall not receive credit for his Hours of
Service completed with an Affiliated Company prior to the effective date
in which the entity became an Affiliated Company.
(e) The Hours of Service credited to an Employee under
this Section with respect to a period during which no duties are
performed shall be determined in accordance with the rules set forth in
Department of Labor Regulations Section 2530.200b-2(b), as such rules
may be amended from time to time.
(f) An Employee's Hours of Service determined under
the foregoing provisions of this Section shall be credited to the
applicable Computation Period in accordance with the rules set forth in
Department of Labor Regulations Section 2530.200b-2(c), as such rules
may be amended from time to time.
(g) Notwithstanding anything to the contrary in the
foregoing, to the extent required under applicable federal law related
to service in the armed forces of the United States, an Employee shall
receive Hours of Service credit computed on the basis of eight hours per
day up to a maximum of 40 hours per week, during any period for which
the Employee is absent from the service of the Company by reason of
service in the armed forces of the United States; provided, however,
such Employee shall receive Hours of Service credit under this Paragraph
(f) only if he complies with the applicable provisions of the federal
law in effect from time to time governing the reemployment of military
personnel, including any provisions relating to timely application for
reemployment (followed by actual reemployment as a result of such
application).
2.31 INVESTMENT MANAGER.
"Investment Manager" shall mean the one or more Investment
Managers, if any, that are appointed pursuant to the provisions of Article IX of
the Plan.
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2.32 LEAVE OF ABSENCE.
(a) "Leave of Absence" shall mean any personal leave
from active employment (whether with or without pay) duly authorized by
the Company under the Company's standard personnel practices. All
persons under similar circumstances must be treated in a uniform and
nondiscriminatory manner in the granting of Leaves of Absence. Leaves of
Absence may be granted by the Company for reasons of health (including
temporary sickness or short-term disability) or public service or for
any other reason determined by the Company to be in its best interests.
If an Employee returns to work on or before the end of a Leave of
Absence, he will not be deemed to have incurred a Break in Service by
reason of such Leave of Absence. However, the Employee shall not be
deemed to have earned any Hours of Service during the period of time of
the Leave of Absence, except as provided in Section 2.30. If an Employee
fails to return to work by the scheduled end of a Leave of Absence, he
shall be considered to have incurred a Severance as of the end of the
Leave of Absence, or on the date on which he notifies the Company that
he will not return to work, whichever is sooner.
(b) In addition to Leaves of Absence as defined in
Paragraph (a) above, the term Leave of Absence shall also mean a
Maternity or Paternity Leave, as defined herein, but only to the extent
and for the purposes required under Paragraphs (c), (d) and (e) below.
As used herein, "Maternity or Paternity Leave" shall mean an absence
from work without pay for any period --
(i) By reason of the pregnancy of the Employee,
(ii) By reason of the birth of a child of the
Employee,
(iii) By reason of the placement of a child with
the Employee in connection with the adoption of the child by the
Employee, or
(iv) For purposes of caring for the child for a
period beginning immediately following the birth or placement
referred to in Subparagraphs (ii) or (iii) above.
(c) An Employee absent from work by reason of a
Maternity or Paternity Leave described in Paragraph (b) shall be
credited with the number of Hours of Service described below:
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(i) The number of Hours of Service that otherwise
would normally have been credited to the Employee but for the
absence, or
(ii) If the number in Subparagraph (i) above
cannot be determined under the Plan, eight Hours of Service per
day of such absence;
provided, however, that the total number of hours treated as Hours of
Service by reason of this Paragraph (c) shall not exceed 501 and,
further provided, that such Hours of Service shall be taken into account
solely for purposes of determining whether or not the Employee has
incurred a Break in Service. Accordingly, such Maternity or Paternity
Leave shall not result in an accrual of Years of Service for purposes of
the eligibility or vesting provisions of this Plan.
(d) The Hours of Service described in Paragraph (c) shall
be credited to the Computation Period (i) in which the absence from work
begins, if the Employee would be prevented from incurring a Break in
Service in that Computation Period solely because the period of absence
is treated as Hours of Service under this Section, or (ii) in any other
case, in the immediately following Computation Period.
(e) A Maternity or Paternity Leave shall not be treated as
a Leave of Absence unless the Employee provides such timely information
as the Committee may reasonably require to establish that the absence is
for the reasons listed in Paragraph (b) above and to determine the
number of days for which there was such an absence.
(f) Notwithstanding the limitations provided in Paragraph
(c) above, a Maternity or Paternity Leave described in Paragraph (b)
shall be treated as an authorized Leave of Absence as described in
Paragraph (a) for all purposes of this Plan to the extent the period of
absence is authorized as a Leave of Absence under the Company's standard
personnel practices and thus is covered by the provisions of Paragraph
(a) without regard to the provisions of Paragraph (b); provided,
however, that the special rule provided under this Paragraph (f) shall
not apply if it would result in a Participant who is absent on a
Maternity or Paternity Leave being deemed to have incurred a Break in
Service sooner than under the rules set forth in Paragraph (c).
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2.33 LEVERAGED COMPANY STOCK.
"Leveraged Company Stock" shall mean any Company Stock that is
acquired by the Trustee with the proceeds of a loan made or guaranteed by the
Company or any other party constituting a "disqualified person" within the
meaning of Internal Revenue Code Section 4975(e)(2).
2.34 LIMITATION YEAR.
"Limitation Year" shall mean the Plan Year, which shall be the
period which the Company elects to use for purposes of applying the limitations
on contributions set forth in Article XIV.
2.35 NORMAL RETIREMENT DATE.
"Normal Retirement Date" with respect to each Employee shall mean
the Employee's sixty-fifth birthday.
2.36 PARTICIPANT.
"Participant" shall mean any Eligible Employee of the Company who
meets the eligibility requirements of this Plan and has been enrolled as a
Participant in this Plan in accordance with the provisions of Article III.
2.37 PARTICIPATION COMMENCEMENT DATE.
"Participation Commencement Date" shall mean each January 1 and
July 1, which shall be the days on which a Participant's participation in this
Plan may commence in accordance with the provisions of Article III.
2.38 RESERVED FOR PLAN MODIFICATIONS.
2.39 RESERVED FOR PLAN MODIFICATIONS.
2.40 PLAN.
"Plan" shall mean the Retail Merchandising Service Automation,
Inc. Employee Stock Ownership Plan set forth herein, as it may be amended from
time to time.
2.41 PLAN ADMINISTRATOR.
"Plan Administrator" shall mean the administrator of the Plan
within the meaning of Section 3(16)(A) of ERISA. The Plan Administrator shall be
Retail Merchandising Service Automation, Inc.
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2.42 PLAN REPRESENTATIVE.
"Plan Representative" shall mean the one or more persons who are
designated as such by the Committee for purposes of witnessing spousal consents
and performing such other duties as are required under the provisions of this
Plan document to be performed by a Plan Representative.
2.43 PLAN YEAR.
"Plan Year" shall mean the twelve month period commencing on July
1 and ending on June 30.
2.44 RESERVED FOR PLAN MODIFICATIONS.
2.45 REEMPLOYMENT COMMENCEMENT DATE.
"Reemployment Commencement Date" shall mean, with respect to any
Employee, the first day for which such Employee is entitled to be credited with
an Hour of Service under Section 2.30(a) for the performance of duties after the
end of the Computation Period during which such Employee incurred a Break in
Service. Except as is expressly provided otherwise in this Plan or in
resolutions of the Board of Directors, an Employee shall not, for purposes of
determining his Reemployment Commencement Date, be deemed to have commenced
employment with an Affiliated Company prior to the date on which the entity
became an Affiliated Company.
2.46 SEVERANCE.
"Severance" shall mean the termination of an Employee's
employment, in any capacity, with the Company or its Affiliated Companies, by
reason of such Employee's death, resignation, dismissal or otherwise.
2.47 RESERVED FOR PLAN MODIFICATION.
2.48 SPECIAL SUSPENSE ACCOUNT.
"Special Suspense Account" shall mean the account (if any)
established and maintained in accordance with the provisions of Article XIV for
the purpose of holding and accounting for allocations of excess Annual Additions
(as defined in Section 14.2).
2.49 SPOUSE.
"Spouse" shall mean the person to whom a Participant is married
as of the date on which a Participant's Plan benefit commences to be paid or, in
the case of a Participant who dies before the commencement of his Plan benefit,
the
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person to whom such deceased Participant is married on the date of his death.
2.50 SUSPENSE ACCOUNT.
"Suspense Account" shall mean the special Trust Fund Account
established and maintained pursuant to the provisions of Article X for the
purpose of holding Leveraged Company Stock until such Stock is released and
allocated in accordance with the applicable provisions of this Plan.
2.51 TRUST AND TRUST FUND.
"Trust" or "Trust Fund" shall mean the Trust (or other investment
vehicle) created for holding the assets of the Plan.
2.52 TRUSTEE.
"Trustee" shall mean Allen E. Merrill, or any successor or
successors acting as Trustee of the Trust Fund.
2.53 VALUATION DATE.
"Valuation Date" shall mean the last day of each Plan Year, and
shall also mean such other dates as may be selected by the Committee for valuing
the assets of the Plan if the Committee determines that such valuations should
be made more frequently than once per year for purposes of making allocations
and distributions under the Plan.
2.54 VESTED INTEREST.
"Vested Interest" shall mean the interest of a Participant in the
Trust Fund which has become vested (nonforfeitable) pursuant to the provisions
of Article VII of this Plan.
2.55 YEAR OF SERVICE.
"Year of Service" shall mean, with respect to any Employee, each
Year of Service determined in accordance with the following rules:
(a) With respect to the period prior to the Effective
Date, each Employee shall be credited with one Year of Service for each
Computation Period between such Employee's most recent Employment
Commencement Date or Reemployment Commencement Date occurring prior to
the Effective Date and the Effective Date during which the Employee
completed 1,000 or more Hours of Service. Except as provided
hereinabove, no Employee shall be
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credited with any Years of Service with respect to the period prior to
the Effective Date.
(b) On and after the Effective Date, each Employee
shall be credited with one Year of Service for each Computation Period,
including the Computation Period in which the Effective Date falls,
during which the Employee completes 1,000 or more Hours of Service.
(c) Notwithstanding the provisions of Paragraph (b)
above, in the case of any Employee who on or after the Effective Date
incurs a Break in Service prior to his commencement of active
participation in the Plan, Years of Service before such Break shall not
be taken into account if the number of consecutive Breaks in Service
equals or exceeds his Parity Period. For purposes of this Paragraph (c),
the term "Parity Period" shall mean the greater of (A) five years or (B)
the Employee's Years of Service credit accrued prior to the Break in
Service (but excluding any pre-Break Years of Service which are not
required to be taken into account under this Section by reason of any
prior Break in Service).
(d) An Employee shall be credited with Years of
Service with respect to a period of employment with an Affiliated
Company, but only to the extent that the period of employment would be
so credited under the rules set forth in this Section had the Employee
been employed during that period by the Company.
(e) Notwithstanding the preceding rules, unless the
Company shall so provide by resolution of its Board of Directors, or
unless otherwise expressly stated in this Plan, an Employee shall not
receive Years of Service credit for any period of employment with an
Affiliated Company prior the date on which the entity becomes an
Affiliated Company.
(f) In no event will an Employee be credited with more
than one Year of Service with respect to service performed in a single
Computation Period.
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ARTICLE III
ELIGIBILITY AND PARTICIPATION
3.1 ELIGIBILITY TO PARTICIPATE.
Every Eligible Employee of the Company shall become eligible to
participate in this Plan under the following rules:
(a) Every Eligible Employee shall become eligible to
participate in this Plan as of the date he is credited with a "Year of
Eligibility Service." A Participant shall be credited with a "Year of
Eligibility Service" as of the earlier of the following dates: (i) the
end of his Eligibility Computation Period, if he completes at least
1,000 or more Hours of Service during such Period; or (ii) the end of a
Plan Year in which he completes 1,000 or more Hours of Service.
(b) Participants who have attained their Normal
Retirement Dates will be eligible to participate in the Plan to the same
extent as Participants who have not attained such age.
3.2 AUTOMATIC ENROLLMENT AND COMMENCEMENT OF PARTICIPATION:
(a) Any Eligible Employee who has satisfied the
eligibility requirements set forth in Section 3.1 shall, subject to the
provisions of Paragraphs (c) and (d) below, commence participation in
this Plan effective as of the Participation Commencement Date (i.e.,
January 1 or July 1) coinciding with or next following his satisfaction
of the eligibility requirements specified under Section 3.1, provided
that he continues to be an Eligible Employee as of that Participation
Commencement Date.
(b) If a Participant incurs a Severance and he is
subsequently reemployed prior to incurring a Break in Service, he shall
recommence participation in the Plan as of the date following such
Severance on which he first performs an Hour of Service in any capacity
for the Company or any Affiliated Company, provided that he is an
Eligible Employee as of such date.
(c) In the case of any Employee who incurs a Break in
Service, for the purpose of determining the Employee's eligibility to
commence or to continue to participate in this Plan, his Year of
Eligibility Service (if any), as defined in Section 3.1(a), prior to the
Break shall be taken into account unless it must be
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disregarded under the rule of parity provisions of Section 2.55(c)
(relating to Years of Service for vesting) as applied to the crediting
of a Year of Eligibility Service. If it is determined after applying the
rule in the preceding sentence that the Employee is entitled to commence
or recommence participation in the Plan immediately upon his
reemployment, the Employee shall resume active participation in the Plan
as of his Reemployment Commencement Date immediately following that
Break in Service, provided that he is an Eligible Employee as of such
date.
(d) During the first Plan Year in which an Eligible
Employee is eligible to participate in the Plan (or during the Plan Year
in which an Eligible Employee subject to the provisions of Paragraph (b)
or (c) returns to active employment, as the case may be), the Committee
shall notify the Eligible Employee of his eligibility to participate and
may, if the Committee so elects, require him to complete and file with
the Committee a written participation enrollment form. Such form may set
forth requirements for designation of Beneficiary and any other matters
necessary for the administration of this Plan. Each Eligible Employee
who commences participation in the Plan shall furnish all other
information and execute all other instruments as may be required by the
Committee in order to enroll such Employee as a Participant under this
Plan.
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ARTICLE IV
TRUST FUND AND CONTRIBUTIONS
4.1 TRUST FUND.
The Company will establish a Trust for the Plan. Under the Trust
Agreement governing such Trust, the Trustee will agree to hold and administer in
trust all amounts accumulated under the Plan together with the additional funds
and assets deposited with the Trustee pursuant to the terms of this Plan.
4.2 COMPANY CONTRIBUTIONS.
Subject to the right of the Company to amend or terminate this
Plan, or to suspend or discontinue contributions to this Plan, for each Plan
Year the Company shall contribute to the Trust Fund an amount to be determined
by the Board of Directors in its sole discretion; provided, however, for each
Plan Year the Company shall contribute in cash an amount sufficient to pay the
Current Obligations (if any) of the Trust in accordance with the rules of
Section 10.2.
4.3 RULES APPLICABLE TO COMPANY CONTRIBUTIONS.
All Company Contributions to the Plan shall be subject to the
following rules:
(a) In no event shall the Company Contributions under this
Plan exceed the maximum allowable deduction available to the Company for
the fiscal year under Section 404 of the Code (except to the extent
required to pay the Current Obligations of the Trust in accordance with
the provisions of Section 10.2).
(b) No Company Contributions shall be made at any time
when the allocation of such Company Contributions would be precluded by
the rules of Article XIV.
(c) Company Contributions under this Plan may be made in
cash, Company Stock or such other property as the Board of Directors may
from time to time determine; provided, however, that Company
Contributions shall be made in cash to the extent necessary to discharge
the Current Obligations of the Trust.
(d) All Company Contributions shall be paid directly to
the Trustee and may be made on any date or dates selected by the
Company; provided however, all Company Contributions shall be made
within the time
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period prescribed for filing the Company's federal income tax return
(including extensions therefor) for its taxable year corresponding to
the Plan Year with respect to which such Company Contributions are made.
4.4 INITIAL VALUATION OF COMPANY CONTRIBUTIONS.
For purposes of this Plan, the Company's non-cash contributions
(other than Company Stock) initially shall be valued at their fair market value
as of the date of contribution. Subject to the special valuation rules for
Leveraged Company Stock set forth in Section 10.3, Company Stock contributed by
the Company to the Trust Fund initially shall be valued at its fair market value
as of the date of contribution. Any Company Stock acquired by the Trust Fund
with cash shall be valued initially at the purchase price paid by the Trust. All
such initial valuations are subject to revaluation as of any subsequent date of
valuation that may apply pursuant to the terms of this Plan and/or applicable
law. Notwithstanding the foregoing, any valuation of Company Stock that is not
Freely Tradeable Stock shall be by one or more independent appraisers.
4.5 INVESTMENT AND APPLICATION OF COMPANY CONTRIBUTIONS.
(a) The general investment policy of the Plan, and the
Trust created hereunder, is primarily to acquire Company Stock, and,
subject to the requirement of reserving cash assets necessary to
discharge Current Obligations, Trust Fund assets other than Company
Stock may be used to acquire additional Company Stock from current
shareholders or from the Company. To the extent not so invested to
acquire Company Stock, and to the extent consistent with preserving the
Plan's status as an employee stock ownership plan as defined under Code
Section 4975(e)(7), Trust Fund assets other than Company Stock may be
invested by the Trustee, subject to the discretion of the Committee, in
savings accounts, certificates of deposit, high-grade short-term
securities, stocks, bonds or other investments deemed by the Committee
to be desirable investments by the Trust, or such funds may be held in
cash or cash equivalents pending distribution to Participants or other
use by the Trust. Notwithstanding the foregoing, the investment and
application of Company Contributions under this Plan shall be subject to
the special rules set forth in Paragraph (b) below.
(b) All cash Company Contributions specified by the
Company for the payment of Current Obligations shall first be applied
towards the payment of Current Obligations of the Trust (as they become
due) incurred
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for the purpose of acquiring Leveraged Company Stock (after the
application towards such payment, in accordance with the provisions of
Section 6.7(d), of any cash dividends on Leveraged Company Stock held by
the Trustee in the Suspense Account) as provided in Article X. Cash
Company Contributions that are not specified by the Company for payment
of Current Obligations, and Trust Fund earnings thereon, shall be
allocated in accordance with the provisions of Section 6.5 and/or
Section 6.6, whichever shall be applicable.
4.6 IRREVOCABILITY.
The Company shall have no right or title to, nor interest in,
Company Contributions made to the Trust Fund, and no part of the Trust Fund
shall revert to the Company, except that on and after the Effective Date funds
may be returned to the Company as follows:
(a) In the case of a Company Contribution that is made by
a mistake of fact, the contribution may be returned to the Company
within one (1) year after it is made.
(b) All Company Contributions to the Plan are hereby
conditioned on the initial qualification of the Plan under Sections 401
and 4975(e)(7) of the Code. If the Plan does not so initially qualify,
at the Company's written election the Plan may be revoked by the Company
and all such contributions (and assets derived therefrom) shall be
returned to the Company within one (1) year after the date of denial of
the initial qualification of the Plan by the Internal Revenue Service.
Upon such a revocation, the affairs of the Plan and Trust shall be
terminated as the Company shall direct.
(c) All Company Contributions to the Plan are hereby
conditioned on the deductibility thereof for federal income tax purposes
under Code Section 404. At the Company's written election, any such
contributions to the extent the deduction is disallowed, shall be
returned to the Company within one (1) year after the disallowance.
(d) The residue of Special Suspense Account assets that
cannot be allocated to Employees upon a Plan termination shall revert to
the Company in accordance with the provisions of Section 14.5.
4.7 COMPANY NOT OBLIGATED TO CONTINUE CONTRIBUTIONS.
The Company contemplates making contributions to the Trust Fund
for the purposes of providing benefits under the
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Plan. Nothing contained in this Plan, however, shall at any time or under any
circumstances be deemed to impose any obligation or liability on the Company to
make any contributions either to the Trust Fund or to any person whatever. The
Company may also, at any time or from time to time, suspend or discontinue its
contributions.
4.8 COMPANY, COMMITTEE AND TRUSTEE NOT RESPONSIBLE FOR ADEQUACY OF TRUST
FUND.
The Company, Committee and Trustee shall not be liable or
responsible for the adequacy of the Trust Fund to meet and discharge any or all
payments and liabilities hereunder. All Plan benefits will be paid only from the
Trust assets, and neither the Company, the Committee nor the Trustee shall have
any duty or liability to furnish the Trust with any funds, securities or other
assets except as expressly provided in the Plan. Except as required under the
Plan or Trust or under Part 4 of Title I of ERISA, the Company shall not be
responsible for any decision, act or omission of the Trustee or the Committee,
and shall not be responsible for the application of any moneys, securities,
investments or other property paid or delivered to the Trustee.
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ARTICLE V
PARTICIPANT CONTRIBUTIONS
5.1 NO PARTICIPANT CONTRIBUTIONS.
Participants are not permitted to make contributions to this
Plan. In particular, but not by way of limitation on the foregoing, a
Participant shall not be entitled to make, and this Plan shall not accept at any
time, a rollover contribution to the Plan or any other direct or indirect
transfer of assets to this Plan from any other employee benefit plan, individual
retirement account, or any similar plan or account, whether or not such transfer
would satisfy the applicable requirements of Sections 402, 403 or 408 of the
Code.
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ARTICLE VI
PARTICIPANT ACCOUNTS AND ALLOCATIONS
6.1 GENERAL.
(a) All Company Contributions to the Trust Fund shall be
held on an unallocated basis until allocated to Participants' Accounts
as of an Anniversary Date as provided under this Plan or otherwise used
or applied in accordance with the provisions of this Plan.
(b) Except as provided in Section 6.9 (relating to stock
dividends, splits, recapitalizations and other similar stock
transactions with respect to Company Stock held by the Trustee), all
gains, losses, dividends and other property acquisitions and/or
transfers that occur with respect to the Trust Fund shall be held,
charged, credited, debited or otherwise accounted for on an unallocated
basis until allocated to Participants' Account as of a Valuation Date as
provided under this Plan or otherwise used or applied in accordance with
the provisions of this Plan.
6.2 PARTICIPANTS' ACCOUNTS.
(a) In order to account for the allocated interest of each
Participant in the Trust Fund, there shall be established and maintained
for each Participant a Company Stock Account and an Other Investments
Account, which shall be credited and debited as provided for under
Sections 6.3 and 6.4. The purpose of such dual accounts shall be to
account for each Participant's allocable share of Company Stock and
other property (including cash or other investments).
(b) The Accounts of each Participant need not be separated
or segregated so long as each Participant's allocable share of Company
Stock or other investments can be accurately determined.
(c) If at any time there shall be allocated to a
Participant's Company Stock Accounts more than one class of Company
Stock, the Committee shall direct the Trustee with respect to whether
sub-accounts for each such class of stock shall be maintained, and if so
all references in this Plan to Company Stock Accounts shall include and
refer to all such sub-accounts.
6.3 COMPANY STOCK ACCOUNT.
The Company Stock Account of each Participant shall be credited
with the following:
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(a) The Participant's allocable share of Company Stock
(including fractional shares and fractional rights to shares)
contributed in kind by the Company to the Trust Fund or acquired by the
Trustee with the assets of the Trust Fund.
(b) The Participant's allocable share of Company Stock
(including fractional shares or fractional rights to shares) received or
acquired by the Trustee with respect to Company Stock allocated to his
Company Stock Account in accordance with the provisions of Section 6.9
by reason of stock dividends, splits, reorganizations or other
recapitalizations affecting Company Stock held by the Trustee.
(c) The Participant's allocable share of Leveraged Company
Stock (including fractional shares and fractional rights to shares)
released from the Suspense Account (if any) maintained pursuant to the
provisions of Section 10.4 and 10.5.
(d) The Participant's allocable share of forfeitures of
Company Stock (including fractional shares of fractional rights to
shares).
(e) Company Stock acquired with funds credited to the
Participant's Other Investments Account. Such Company Stock shall be
allocated and credited to the Participant's Company Stock Account as of
the date of its acquisition by the Trust Fund.
6.4 OTHER INVESTMENTS ACCOUNT.
The Other Investments Account of each Participant shall be
credited (or debited, whichever is applicable) with the following:
(a) Credited (or debited) with the Participant's allocable
share of the net income (or loss) of the Trust Fund as provided in
Section 6.6.
(b) Credited with the Participant's allocable share of
Company Contributions to the Trust Fund made in a form other than
Company Stock.
(c) Credited with the Participant's allocable share of
Forfeitures consisting of assets other than Company Stock.
(d) Credited with cash dividends paid on shares of Company
Stock allocated to the Participant's Company Stock Account, other than
those cash dividends which are (i) distributed to the Participant, or
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(ii) used to acquire additional shares of Company Stock, pursuant to the
provisions of Section 6.7.
(e) Debited with the Participant's allocable share of cash
payments from the Trust Fund for the acquisition of Company Stock by the
Trustee.
(f) Debited with the Participant's allocable share of Plan
expenses (if any).
6.5 ALLOCATIONS OF COMPANY CONTRIBUTIONS AND FORFEITURES.
(a) Each Participant who completes one thousand (1,000)
or more Hours of Service during a Plan Year shall be entitled to receive
an allocation of:
(i) The portion of Company Contributions to the
Trust Fund that is not used to pay Current Obligations pursuant
to Section 10.2;
(ii) Company Stock that is released from the
Suspense Account pursuant to the provisions of Section 10.5; and
(iii) Forfeitures (if any) allocable under this
Section.
Such items shall be allocated to each eligible Participant in the
proportion that the Compensation of the Participant during that Plan
Year bears to the aggregate Compensation during that Plan Year of all
Participants who are entitled to an allocation under the rules of this
Paragraph. Notwithstanding the foregoing, a Participant whose employment
is terminated during the Plan Year on a date coincident with or
subsequent to his Normal Retirement Date, or by reason of his death or
Disability, shall be eligible to share in the foregoing allocations
regardless of the number of Hours of Service the Participant completed
during that Plan Year.
(b) Company Stock acquired with unallocated cash Company
Contributions shall be allocated as of the applicable Anniversary Date,
in the same proportions that the cash Company Contributions would have
been allocated if not used to acquire Company Stock.
(c) Should a Participant transfer employment from one
entity maintaining this Plan to another entity also maintaining this
Plan, the Participant shall receive allocations of Company Contributions
and Forfeitures based upon his total Compensation received from each
such entity. However, should a Participant transfer
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employment to an Affiliated Company that does not maintain this Plan,
the Participant shall receive allocations of Company Contributions and
Forfeitures based only on his Compensation received from an entity that
maintains this Plan.
(d) The allocations of Company Contributions under this
Section 6.5 shall be made after the allocations of income under Section
6.6, Forfeitures under Section 6.8, and amounts from the Special
Suspense Account under Section 14.5 have been made.
6.6 REVALUATION OF ACCOUNTS AND ALLOCATIONS OF TRUST FUND INCOME.
Within 60 days after each Valuation Date, and within 60 days
after the removal or resignation of the Trustee, the Trustee shall value the
assets of the Trust on the basis of fair market values. Upon receipt of such
valuations from the Trustee, the Committee shall revalue the Accounts of each
Participant as of the applicable Valuation Date so as to reflect to each such
Account a proportionate share in any increase or decrease in the fair market
value of the assets in the Trust Fund, determined by the Trustee as of that date
as compared with the value of the assets in the Trust Fund as of the immediately
preceding Valuation Date. The valuation and allocation provisions of this
Section shall be applied and implemented in accordance with the following rules:
(a) The Company Stock allocated and credited to the
Participants' Company Stock Accounts, as well as Company Stock held on
an unallocated basis in the Trust Fund (including the Suspense Account),
shall be revalued as of the applicable Valuation Date. In the event any
Company Stock is not Freely Tradeable Stock, the Committee shall use one
or more independent appraisers to value such Company Stock.
(b) With respect to Trust assets other than Company Stock,
as of each such Valuation Date the Committee shall revalue the Other
Investments Account of each Participant so as to reflect to each such
Account a proportionate share in the net income or loss of the assets of
the Trust Fund (other than Company Stock) since the immediately
preceding Valuation Date. Each Participant's share of the net income (or
loss) will be allocated to his Other Investments Account in the ratio
which the balance of such Other Investments Account on the preceding
Valuation Date (reduced by the amount of any distributions or
withdrawals attributable to such Other Investments Account and increased
by the amount of any contributions allocated to such Other Investments
Account prior to the applicable Valuation Date) bears to the sum
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of such balances for all such Participants as of that date. The net
income (or loss) that is allocable pursuant to the provisions of this
Paragraph (b) shall include the increase (or decrease) in the fair
market value of Trust assets (other than Company Stock); all cash income
of the Trust, whether in the form of interest, cash dividends (subject
to the provisions of Sections 6.7 and 10.5), or otherwise; and all
expenses attributable to Trust assets since the preceding Valuation
Date. Said net income (or loss) does not include current Company
Contributions; Forfeitures; any interest paid under any installment
contract for the acquisition of Company Stock by the Trust or on any
loan used by the Trust to finance the acquisition of Company Stock; any
cash dividends to the extent such dividends are allocated or distributed
to Participants or applied towards the payment of Current Obligations as
provided in Section 6.7; nor any Company Stock acquired or received by
the Trustee by reason of a stock dividend, split, or as the result of a
reorganization or recapitalization of the Company as provided in Section
6.9. When made as of the Plan's Anniversary Date, such allocation of net
income and losses under this Paragraph (b) shall be made prior to the
allocations required under Sections 6.5, 6.7, 6.8, 14.5 and 18.2.
(c) Company Stock purchased with any net earnings of the
Trust shall be allocated to the Company Stock Accounts of Participants
in the same manner as such earnings would have been allocated to the
Other Investments Accounts of Participants if such earnings had not been
used to acquire Company Stock.
(d) Neither the Company, the Committee nor the Trustee in
any manner or to any extent whatsoever warrant, guarantee or represent
that the value of a Participant's Accounts shall at any time equal or
exceed the amount previously contributed thereto.
(e) If at any time the Committee shall determine that the
allocation rules described hereinabove would result in incomplete or
unfair and inequitable allocations for any Plan Year, then the Committee
shall devise more complete or more equitable and fair allocation rules
and direct the Trustee in writing to apply such new rules for said Plan
Year.
6.7 CASH DIVIDENDS.
(a) Except as provided below, all cash dividends paid to
the Trustee with respect to Company Stock shall be allocated to the
Other Investments Accounts of each Participant who has a balance in his
Company Stock Account on the Anniversary Date of the Plan
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Year in which the dividends are received, in the proportion that the
number of shares of Company Stock held in such Participant's Company
Stock Account bears to the total number of shares of Company Stock held
in the Company Stock Accounts of all Participants. The Committee shall
prescribe such rules and procedures as it deems necessary to implement
the provisions of this Paragraph (a).
(b) Notwithstanding the provisions of Paragraph (a), the
Committee may determine, in its discretion, that cash dividends on
shares of Company Stock allocated to Participants' Company Stock
Accounts may be paid currently to such Participants. Such dividends may
be paid directly by the Company, or may be distributed by the Trustee
after receipt from the Company.
(c) Subject to Paragraph (d) below, but notwithstanding
the provisions of Paragraphs (a) and (b) above, the Committee may
determine, in its discretion, that cash dividends with respect to
Company Stock held in the Trust Fund may be used to purchase additional
shares of Company Stock, or in whatever other manner it deems
appropriate.
(d) Notwithstanding anything to the contrary in the
foregoing, cash dividends paid with respect to Leveraged Company Stock
held in the Suspense Account that the Company specifies are to be
applied towards the payment of Current Obligations shall first be
applied towards the payment of Current Obligations of the Trust (as they
become due) incurred for the purpose of acquiring Leveraged Company
stock.
6.8 FORFEITURES.
(a) Any amounts which stood to the credit of a former
Participant's Account that have been forfeited because the Participant
was not fully vested in that Account when the Participant terminated his
employment with the Company shall first be used to reinstate the
Accounts of rehired Participants in accordance with Section 8.6(e).
(b) Any amounts remaining after the reinstatements have
been made in accordance with Paragraph (a) shall be allocated, as of the
applicable Anniversary Date of the Plan Year in which those amounts were
forfeited (determined under the rules of Sections 8.7 and 8.8), to the
Accounts of Participants in accordance with the rules of Section 6.5.
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(c) Leveraged Company Stock shall be forfeited only after
all of the other assets in the Participant's Accounts have been
forfeited. Subject to the foregoing limitation, if more than one class
of Company Stock has been allocated to the Participant's Company Stock
Account and the Participant must forfeit some portion of the Company
Stock in his Company Stock Account, the Participant must be treated as
forfeiting the same proportion of each class of stock.
(d) The Committee shall prescribe such rules as it deems
necessary or appropriate regarding the manner in which amounts shall be
forfeited from a Participant's Accounts. These rules shall be consistent
with the provisions of Code Sections 401(a) and 4975, and the
regulations thereunder.
6.9 STOCK DIVIDENDS, SPLITS, RECAPITALIZATIONS, ETC.
Any Company Stock received by the Trustee as a stock split,
dividend, or as a result of a reorganization or other recapitalization of the
Company shall be allocated, as of the day on which the stock is received by the
Trustee, in the same manner as the Company Stock to which it is attributable is
then allocated.
6.10 STOCK RIGHTS, WARRANTS OR OPTIONS.
(a) In the event any rights, warrants or options are
issued on Company Stock held in the Trust Fund, the Trustee shall
exercise them for the acquisition of additional Company Stock as
directed by the Committee to the extent that cash is then available in
the Trust Fund.
(b) Any Company Stock acquired in this fashion shall be
treated as Company Stock purchased by the Trustee for the net price paid
and shall be allocated in the same manner as the funds used to purchase
the Company Stock were or would be allocated under the provisions of
this Plan. Thus, if the funds used to purchase the stock consisted of
unallocated Company Contributions, the stock would be allocated under
the terms of Section 6.5; if the funds used consisted of the unallocated
net income of the Trust, the stock would be allocated as provided in
Section 6.6; and if the funds used consisted of funds previously
allocated to the Other Investment Accounts, the stock would be allocated
in the manner in which the Other Investment Accounts are debited and
credited.
(c) Any rights, warrants, or options on Company Stock
which cannot be exercised for lack of cash may, as directed by the
Committee, be sold by the Trustee
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and the proceeds allocated in accordance with the source of the Company
Stock with respect to which the rights, warrants, or options were issued
in accordance with rules of Paragraph (b) above.
6.11 NOTICE OF ALLOCATIONS.
After the close of each Plan Year, the Committee shall notify
each Participant as to the allocations made during the Plan Year pursuant to
this Article VI, which notice shall include the following:
(a) The balance in his Other Investments Account and the
number of shares held in his Company Stock Account as of the most recent
Anniversary Date;
(b) The amount of Company Contributions, Forfeitures, and
Leveraged Company Stock (if any) allocated to his Accounts for that Plan
Year;
(c) The adjustment to his Accounts to reflect his share of
undistributed dividends held at year end (if any) and the net income (or
loss) of the Trust for that Plan Year;
(d) The new balance in his Other Investments Accounts and
the number of shares held in his Company Stock Account, as of the
Anniversary Date of that Plan Year; and
(e) Such other information as may be required by the
applicable regulations.
6.12 NOTICE OF VALUE OF COMPANY STOCK.
(a) In the event that any Company Stock held by the Trust,
(whether in the Suspense Account or allocated to Company Stock
Accounts), is not Freely Tradeable Stock, the Company annually shall
furnish to the Committee and to the Trustee a certificate of value
setting forth the value of the various classes or types of such Company
Stock held by the Trust. In the case of any such stock, such value shall
be determined by one or more independent appraisers in accordance with
Code Section 401(a)(28).
(b) Pursuant to the provisions of Section 8.14, this
annual certificate of value shall be furnished to Qualified Holders (as
defined in Section 8.14) of such Company Stock that has been distributed
to a terminated Participant or his Beneficiary.
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6.13 TREATMENT OF ACCOUNTS UPON SEVERANCE.
Upon a Participant's Severance, pending distribution of the
Participant's benefit pursuant to the provisions of Article VIII below, the
Participant's Accounts shall continue to be maintained and accounted for in
accordance with all applicable provisions of this Plan, including but not
limited to the provisions of this Article VI.
6.14 MISCELLANEOUS ALLOCATION RULES.
(a) Subject to the limitation provided in the immediately
following sentence, in the event that there is more than one class of
Company Stock to be allocated to Participants' Accounts, there shall be
allocated to the Company Stock Account of each Participant who is
entitled to share in allocations of Company Stock as of any applicable
date the portion of each class of Company Stock to be allocated as of
that date which the amount to be allocated to the Company Stock Account
of such Participant bears to the total amount to be allocated to the
Company Stock Accounts of all Participants entitled to share in such
allocation. The foregoing general allocation rule concerning multiple
classes of Company Stock shall be applied separately with respect to (i)
Leveraged Company Stock released from the Suspense Account and allocated
pursuant to Section 10.5, and (ii) all other Company Stock allocated as
of any applicable date.
(b) Allocations of all assets other than Company Stock
shall be made on the basis of, and expressed in terms of, dollar value.
Allocations of Company Stock shall be made on the basis of the number of
shares of Company Stock (including fractional shares).
(c) The Committee and the Trustee may establish accounting
procedures for the purpose of making the allocations, valuations and
adjustments to Participants' Accounts provided for in this Article VI.
From time to time the Committee and Trustee may modify such accounting
procedures for the purpose of achieving equitable, nondiscriminatory,
and administratively feasible allocations among the Accounts of
Participants in accordance with the general concepts of the Plan and the
provisions of this Article VI.
6.15 ALLOCATION OF COMPANY STOCK ATTRIBUTABLE TO CODE SECTION 1042.
(a) Notwithstanding anything to the contrary in this Plan,
no portion of the assets of this Plan attributable to Company Stock
acquired by this Plan in a
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sale to which Code Section 1042 applies may be allocated to the accounts
of 409(n) Participants (as defined below) during the Nonallocation
Period (as defined below).
(b) (i) In order to implement the allocation restriction
described in Paragraph (a) above, the following provisions of
this Paragraph (b) shall apply with respect to sales of Company
Stock to the Plan under the Tender Offer.
(ii) For purposes of this Paragraph (b), the
following definitions shall apply:
(A) Those shares of Company Stock sold to
the Plan under the Tender Offer and with respect to which
there has been an election under Code Section 1042 shall
be referred to as "1042 Shares."
(B) The Nonallocation Period for sales of
1042 Shares shall be referred to as the "Applicable
Nonallocation Period". The Applicable Nonallocation Period
shall begin on the closing date for the sales made
pursuant to the Tender Offer and shall end on the later of
(1) the date which is 10 years after such closing date or
(2) the date of the allocation attributable to the final
payment of acquisition indebtedness incurred in connection
with such sales of Company Stock made pursuant to the
Tender Offer.
(iii) Notwithstanding the provisions of Section
6.5(a), during the Applicable Nonallocation Period the allocation
of Company Stock (including but not limited to Company Stock
released from the Suspense Account pursuant to the provisions of
Section 10.5 and Company Stock which represents Forfeitures under
the Plan) to the Accounts of Participants shall be carried out in
the manner described in this Paragraph (b). First, the Company
shall determine which shares of Company Stock to be allocated
pursuant to the provisions of Section 6.5(a) of the Plan are 1042
Shares. Second, 1042 Shares shall be allocated to each Non-409(n)
Participant (as defined below) who is eligible for an allocation
under the provisions of Section 6.5(a) in the proportion that the
Compensation of such Non-409(n) Participant bears to the
aggregate Compensation of all Non-409(n) Participants who are
entitled to an allocation under the provisions of Section 6.5(a).
Third, all other shares of Company Stock to be allocated shall be
allocated to each
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Participant who is eligible for an allocation under the
provisions of Section 6.5(a) in the proportion that the
Compensation of such eligible Participant bears to the aggregate
Compensation of all eligible Participants.
(c) For the purposes of this Section 6.15, the following
definitions shall apply:
(i) "409(n) Participant" shall mean:
(A) an individual who makes an election
under Code Section 1042(a) with respect to Company Stock;
(B) an individual who is related to an
individual described in (A) above (as defined in Code
Section 267(b)); or
(C) an individual ("25% Shareholder") who
owns (after the application of the attribution rules set
forth in Code Section 318(a) without regard to the
employee trust exception set forth in Code Section
318(a)(2)(B)(i)) more than 25% of (a) any class of
outstanding stock of the Company or of any corporation
which is a member of the same controlled group of
companies (within the meaning of Code Section 409(1)(4))
as the Company, or (b) the total value of any class of
outstanding stock of the Company or any such corporation.
An individual shall be treated as a 25% Shareholder if
such individual is a 25% shareholder (1) at any time
during the one-year period ending on the date of the sale
of Company Stock to the Plan or (2) the date as of which
Company Stock is allocated to Participants in the Plan.
(ii) "Non-409(n) Participant" shall mean any
Participant who is not a 409(n) Participant.
(iii) Notwithstanding the foregoing provisions of
Subparagraphs (i) and (ii) above, a 409(n) Participant shall
retain his status as a 409(n) Participant during the entire
Nonallocation Period.
(iv) "Nonallocation Period" shall mean the period
beginning on the date of the sale of any Company Stock to which
Code Section 1042 applies and ending on the later of (i) the date
which is 10 years after the date of sale, or (ii) the date of
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the allocation attributable to the final payment of acquisition
indebtedness incurred in connection with such sale of Company
Stock to which Code Section 1042 applies.
6.16 SPECIAL DISTRIBUTION RULE.
(a) For the purpose of this Section 6.16 only, the
following definitions shall apply:
(i) "Qualified Participant" shall mean a
Participant who has attained age 55 and who has completed at
least 10 years of participation in the Plan.
(ii) "Qualified Election Period" shall mean the six
Plan Year period beginning with the Plan Year in which the
Participant first becomes a Qualified Participant.
(b) Within ninety (90) days after the close of each
Plan Year in the Participant's Qualified Election Period, a Qualified
Participant may direct the Plan to distribute a portion of the Company
Stock held in such Participant's Company Stock Account. However, no
distribution election with respect to a Participant shall be given
effect pursuant to the provisions of this Section 6.16 to the extent
that the sum of (a) the number of shares theretofore distributed with
respect to such Participant under this Section 6.16, and (b) shares
elected to be distributed pursuant to such distribution election,
exceeds a number of shares equal to (x) the "Aggregate Limit Percentage"
(as defined in the succeeding provisions of this Section 6.16),
multiplied by (y) the number of shares of Company Stock held in the
Participant's Company Stock Account as of the Valuation Date occurring
at the end of the Plan Year immediately preceding the Plan Year to which
such distribution election relates, adjusted to reflect any distribution
of shares subsequent to such Valuation Date. The "Aggregate Limit
Percentage" for purposes of this Section 6.16(b) shall mean,
(i) for any distribution election with respect to a
Plan Year during the first five Plan Years in the Qualified
Election Period, twenty-five percent (25%), and
(ii) for a distribution election with respect to
the sixth Plan Year in the Qualified Election Period, fifty
percent (50%).
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The resulting number of shares shall be rounded to the nearest whole
integer. Any such election for a Plan year falling within a
Participant's Qualified Election Period shall be made in the manner
provided under Paragraph (c) below.
(c) The Participant's direction shall be provided to the
Committee in writing and in such form as the committee may from time to
time prescribe. After direction is given by the Qualified Participant,
the Plan shall distribute, in one lump sum cash distribution
(notwithstanding section 409(d) of the Code) the portion of the
Participant's Company Stock Account that is covered by the election
within ninety (90) days after the last day of the period during which
the election can be made. This Section 6.16(c) shall apply
notwithstanding any other provision of the Plan other than such
provisions as require the consent of the Participant to a distribution
with a present value in excess of $3,500. If the Participant does not
consent, such amount shall be retained in this Plan.
(d) No provision in this Section 6.16 or Code Section
401(a)(28) shall be interpreted or applied to require the distribution
of any amount in excess of the Participant's vested interest under the
Plan.
(e) A distribution with respect to a Participant pursuant
to this Section 6.16 shall be deemed to consist of a distribution of
shares of different categories recognized pursuant to provisions of the
Plan, in the same proportion that each such category of shares held in
the Participant's Company Stock Account as of the relevant valuation
date bears to all shares held in the Participant's Company Stock Account
as of the relevant valuation date. as used in the preceding sentence,
the term "relevant valuation date" means the Valuation Date occurring at
the end of the Plan Year preceding the Plan Year to which such
distribution relates. For purposes of this Subsection 8.14(e), shares of
different categories shall include but not be limited to Pretransaction
Shares (as defined in Section 8.14(j)), shares other than Pretransaction
shares, and 1042 Shares (as defined in Section 6.15).
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ARTICLE VII
VESTING IN PLAN ACCOUNTS
7.1 NO VESTED RIGHTS EXCEPT AS HEREIN SPECIFIED.
No Participant shall have any vested right or interest to, or any
right of payment of, any assets of the Trust Fund, except as provided in this
Plan. Except as expressly provided in this Plan, the making of any allocations
or credits to any Account of a Participant shall not vest in any Participant any
right, title, or interest in or to any assets of the Trust Fund.
7.2 VESTING SCHEDULE.
Subject to the special vesting rules of Section 7.3 and Section
7.4, the Vested Interest of each Participant who is credited with an Hour of
Service on or after January 1, 1989, shall be determined on the basis of each
Participant's full Years of Service, in accordance with the following schedule:
Vested
Number of Full Years of Service Percentage
- ------------------------------- ----------
Less than one year 0%
One year but less than two years 10%
Two years but less than three years 20%
Three years but less than four years 30%
Four years but less than five years 40%
Five years but less than six years 60%
Six years but less than seven years 80%
Seven years or more 100%
In the case of a Participant who is not credited with an Hour of
Service on or after January 1, 1989, the Vested Interest of such Participant
shall be determined in accordance with the provisions of this Section 7.2 as in
effect prior to January 1, 1989.
7.3 SPECIAL VESTING RULES.
Notwithstanding the rules of Section 7.2, the determination of a
Participant's Vested Interest in his Accounts shall be subject to the following
rules:
(a) During a Participant's period of employment with the
Company, in the event of his retirement, death, permanent Disability,
attainment of Normal Retirement Date, or a judicial declaration of his
incompetence, the Participant shall become 100% vested in his Accounts;
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(b) In the case of any Participant who has incurred five
consecutive one-year Breaks in Service, his Years of Service, if any,
after such five consecutive one-year Breaks in Service shall not be
taken into account for purposes of determining the Participant's Vested
Interest in his Accounts that accrued before such five consecutive
one-year Breaks in Service.
(c) In the case of any Participant who does not have any
Vested Interest in benefits under this Plan attributable to Company
Contributions and who incurs a Break in Service, the determination of
whether his Years of Service before the Break in Service shall be taken
into account for vesting purposes shall be made in accordance with the
rule of parity provisions of Section 2.55(c).
7.4 CHANGE IN VESTING SCHEDULE.
In the event the vesting schedule of this Plan is amended, the
following rules shall apply:
(a) The Vested Interest of each Participant (determined as
of the later of the date such amendment is adopted or the date such
amendment becomes effective) shall not be less than the Vested Interest
of such Participant computed under the Plan without regard to such
amendment.
(b) Each Participant who has at least three (3) Years of
Service with the Company (whether or not consecutive) shall be entitled
to elect to continue to have his Vested Interest in the Plan determined
under the vesting schedule in effect immediately prior to such
amendment; provided, however, that such election shall not be available
to any Participant whose Vested Interest under the Plan, as amended,
will not at any time be less than such Participant's Vested Interest
determined without regard to such amendment.
(c) An election pursuant to Paragraph (b) must be made in
such manner as the Committee prescribes and must be made during the
period beginning on the date the plan amendment changing the vesting
schedule is adopted and ending on the date which is 60 days after the
latest of (i) the day such amendment is adopted, (ii) the day such
amendment becomes effective, or (iii) the day the Participant is issued
written notice of such amendment by the Company. Such election may be
made only by an Employee who is a Participant in the Plan at the time
such election is made. When the applicable election period has expired,
the Participant shall no longer be entitled to make an election pursuant
to Paragraph (b).
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Any election pursuant to Paragraph (b) shall be irrevocable.
(d) This Section shall be interpreted and applied in a
manner consistent with the provisions of Code Section 411(A)(10) and the
regulations thereunder.
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ARTICLE VIII
PAYMENT OF PLAN BENEFITS
8.1 RETIREMENT.
A Participant will ordinarily retire from the employment of the
Company on his Normal Retirement Date. If the Participant continues in the
service of the Company beyond his Normal Retirement Date, he shall continue to
participate in the Plan in the same manner as Participants who have not reached
their Normal Retirement Dates. At the subsequent termination of the
Participant's employment, his benefits, as provided in Section 8.2, shall be
based upon the value of his Accounts as of the Valuation Date coinciding with or
immediately preceding the distribution (or commencement of distribution) of his
Plan benefits. After a Participant has reached his Normal Retirement Date, any
Severance of the Participant's employment (other than by reason of death) shall
be deemed a retirement.
8.2 METHOD OF DISTRIBUTION UPON RETIREMENT.
Upon retirement a Participant shall be entitled to a lump sum
distribution of his entire interest in the Trust Fund. Payment of such
distribution shall be made as soon as reasonably possible after the retirement
of the Participant (subject, however, to the provisions of this Article VIII
requiring distributions to be made within specified time periods).
8.3 DISABILITY PRIOR TO TERMINATION OF EMPLOYMENT.
In the event that the Committee shall determine that a
Participant has suffered a permanent Disability while an Employee of the
Company, the Committee shall direct the Trustee to make a lump sum distribution
of the Participant's entire interest in the Trust Fund to the disabled
Participant as soon as reasonably possible after the date upon which the
Participant is determined to be permanently disabled (subject, however, to the
provisions of this Article VIII requiring distributions to be made with the
consent of the Participant and within specified time periods).
8.4 DISTRIBUTIONS UPON DEATH.
In the event of the death of a Participant, his entire interest
in the Trust Fund shall be distributed in a lump sum to his surviving Spouse or,
if applicable, to such other Beneficiary as may be designated in accordance with
Section 8.5. Such distribution shall be made as soon as reasonably possible
following the death of the Participant (subject, however, to the provisions of
this Article VIII
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requiring distributions to be made within specified time periods). If the
Participant's Spouse survives the Participant, payment to a Beneficiary other
than the Spouse will be made only if:
(a) The Spouse of the Participant consented in writing to
the designation of another as the distributee and the consent
acknowledges the effect of the designation and is witnessed by a Plan
Representative or a notary public, or
(b) It is established to the satisfaction of a Plan
Representative that the consent required under Paragraph (a) above
cannot (or need not) be obtained because (i) there is no Spouse, (ii)
the Spouse cannot be located, or (iii) there exist such other
circumstances which, pursuant to regulations under Code Section 417,
permit a distribution to such other Beneficiary.
Any consent of a Spouse obtained pursuant to Paragraph (a), or
any determination pursuant to Paragraph (b) that the consent of a Spouse cannot
(or need not) be obtained, shall be effective only with respect to that Spouse.
If a Participant becomes married following his designation as a Beneficiary of
someone other than his Spouse at the time of his death, such Beneficiary
designation shall be ineffective unless the spousal consent requirement is
satisfied under Paragraph (a) or (b) above with respect to his Spouse as of the
date of his death (subject, however, to the provisions of Article XV regarding
distributions pursuant to Qualified Domestic Relations Orders).
8.5 DESIGNATION OF BENEFICIARY.
(a) Subject to the provisions of Section 8.4 above, each
Participant shall have the right to designate a Beneficiary or
Beneficiaries to receive his interest in the Trust Fund in the event of
his death before receipt of his entire interest in the Trust Fund. Such
designation shall be delivered to the Committee on the form prescribed
by the Committee. Subject to the provisions of Section 8.4 above, a
Participant shall have the right to change or revoke any designation by
filing a new designation or notice of revocation with the Committee and,
except as provided in Section 8.4, no notice to any Beneficiary nor
consent by any Beneficiary shall be required to effect any such change
or revocation.
(b) If a deceased Participant shall have failed to
designate a Beneficiary, or if the Committee shall be unable to locate a
designated Beneficiary after reasonable efforts have been made, or if
for any reason
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the designation is legally ineffective, or if the Beneficiary
predeceased the Participant, any distribution required to be made under
the provisions of this Plan shall be paid to the person or persons
included in the highest priority category among the following:
(i) The Participant's surviving Spouse;
(ii) The Participant's surviving children, including
adopted children;
(iii) The Participant's surviving parents; or
(iv) The Participant's estate. However, if the
Committee cannot locate a qualified representative of the
deceased Participant's estate, or if administration of the estate
is not otherwise required, the Committee in its discretion may
make the distribution under this subparagraph (iv) to the
deceased Participant's heirs at law, other than those specified
in subparagraphs (i)-(iii), determined in accordance with the law
of the State of the Participant's domicile in effect as of the
date of his death.
The determination by the Committee as to which persons, if any, qualify
within the foregoing categories shall be final and conclusive upon all
persons. In the event that the deceased Participant was not a resident
of California at the date of his death, the Committee, in its
discretion, may require the establishment of ancillary administration in
California.
(c) In the event that a Participant predeceases his
Beneficiary and on the subsequent death of the Beneficiary a remaining
distribution is payable under the applicable provisions of this Plan,
the distribution shall be payable in the same order of priority
categories as set forth in Paragraph (b) above but determined with
respect to the Beneficiary, subject to the same provisions concerning
non-California residency, the unavailability of an estate representative
and/or the absence of administration of the Beneficiary's estate as are
applicable on the death of the Participant.
(d) Notwithstanding the foregoing, in the case of a
Participant who has a Spouse, any designation by such Participant of a
Beneficiary other than such Spouse and any change in any such non-Spouse
Beneficiary designation shall not be effective unless such Spouse shall
consent in writing to such designation or change in designated
Beneficiary. Any such consent required
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hereunder shall be subject to the provisions of Section 8.4 regarding
spousal consents, including but not limited to the witness requirement
of Section 8.4(a) and the exceptions to such requirement as authorized
by a Plan Representative as provided under Section 8.4(b).
8.6 IRREVOCABILITY OF SPOUSAL CONSENTS.
Except as may be required otherwise under applicable law or the
express provisions of this Plan, if (a) the provisions of applicable law and/or
this Plan require that a Participant's Spouse give his or her written consent to
any benefit election or Beneficiary designation under this Plan, and (b) such
Spouse shall furnish such written consent in accordance with the requirements
and procedures prescribed under applicable law and the terms of this Plan, then
such consent thereafter shall not be revocable by such Spouse. The provisions of
the immediately preceding sentence shall not be interpreted to deny to any
Participant's Spouse any rights of consent or nonconsent that such Spouse may
have under applicable law and/or the terms of this Plan in the event that the
Participant shall subsequently make any additional benefit elections or
Beneficiary designations or any changes to any prior benefit elections or
Beneficiary designations of such Participant.
8.7 DISTRIBUTION ON SEVERANCE PRIOR TO NORMAL RETIREMENT DATE.
(a) If a Participant incurs a Severance prior to
attainment of Normal Retirement Date for any reason other than death or
disability, distribution of his Vested Interest shall be made as
provided in Section 8.10 after receipt by the Committee of all required
documentation, as follows:
(i) In the case of a Participant whose Vested
Interest does not exceed, or at the time of any prior
distribution never exceeded, $3,500, distribution shall be made
as soon as administratively practicable following the
Participant's Severance, whether or not the Participant consents
to such distribution, subject to the requirements of Section 8.16
relating to a direct rollover election.
(ii) In the case of a Participant whose Vested
Interest exceeds, or at any the time of any prior distribution
ever exceeded, $3,500, distribution shall be made as soon as
administratively practicable following the receipt of the
Participant's consent to the distribution in
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accordance with (iv) below, and direct rollover election, if any,
in accordance with Section 8.16.
(iii) If a Participant described in (ii) above
fails to consent to distribution of the Participant's Vested
Interest within ninety (90) days following the Participant's
Severance, such a Participant shall be deemed to have made an
election to defer distribution to Normal Retirement Date, unless
prior to Normal Retirement Date and in accordance with (ii)
above, the Participant submits a request for an earlier
distribution.
(iv) Any consent by a Participant described in (ii)
above to receive distribution of the Participant's Vested
Interest prior to Normal Retirement Date shall not be valid
unless such consent is made both (A) after the Participant
receives a written notice advising him of his right to defer
distribution to Normal Retirement Date and (B) within the ninety
(90) day period ending on the Participant's "Benefit Starting
Date." The notice to the Participant advising him of his right to
defer distribution shall be given no less than thirty (30) nor
more than ninety (90) days prior to the Participant's Benefit
Starting Date; provided, however, a Participant who has received
the notice may make an affirmative election to receive or not to
receive payment prior to the expiration of the thirty (30) day
period. For purposes of this Paragraph (iv), "Benefit Starting
Date" shall mean the date the Participant's Distributable Benefit
is payable from the Plan.
(b) Unless the provisions of (a) above apply, if a
Participant incurs a Severance prior to Normal Retirement Age for any
reason other than death, his Vested Interest shall be paid as provided
in Section 8.10 as soon as administratively feasible following the
Participant's Normal Retirement Date; provided, however, such
distribution shall be made or commence not later than sixty (60) days
after the close of the Plan Year in which the Participant attains Normal
Retirement Date.
(c) If a Participant who incurs a Severance does not have
a 100% Vested Interest in any Account as of such Severance, the portion
of such Participant's Account which is not vested as of such Severance
shall be held in such Account, subject to forfeiture in accordance with
Section 8.8.
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8.8 FORFEITURES; RESTORATION.
(a) Subject to the provisions of (c) below, any non-vested
portion of a Participant's Accounts shall be forfeited as of the earlier
of the date the Participant's Vested Interest is paid to him as provided
in Section 8.7, or the date the Participant incurs five (5) consecutive
Breaks in Service. For purposes of this Section, if the value of a
Participant's Vested Interest is zero, the Participant shall be deemed
to have received payment of his Vested Interest.
(b) Any non-vested portion of a Participant's Accounts
which is forfeited in accordance with (a) above shall be applied as
provided in Section 6.5.
(c) In accordance with such rules as the Committee may
prescribe, there shall be restored to the Participant's Account the
dollar value of any non-vested portion of such a Participant's Account
which was forfeited upon payment of the Participant's Vested Interest in
accordance with (a) above prior to the date on which he incurs five (5)
consecutive Breaks in Service; provided, however, that such restoration
shall be made only in the case of the Participant's reemployment as an
Eligible Employee prior to incurring five (5) consecutive Breaks in
Service. The amount that must be repaid shall be equal to the aggregate
cash value of the money and other property, including Company Stock that
was distributed to the Participant. No adjustment in the dollar value of
the forfeited amounts shall be made for any gains or losses of the Trust
Fund, between the date of distribution and the restoration of the dollar
value of the forfeited portion of the Participant's Account. Restored
amounts shall be paid from currently available forfeitures, or if
forfeitures are not available, the Company shall make an additional
contribution for this purpose.
(d) Thereafter, such Participant's Vested Interest in the
Plan shall be computed to reflect the prior distribution by applying the
formula:
X = P (AB+D) - D
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For the purpose of applying the foregoing formula:
P is the Participant's vested percentage at the relevant
time;
AB is the account balance at the relevant time;
D is the amount of the prior distribution.
8.9 TIMING OF BENEFIT PAYMENTS.
The Committee shall prescribe such rules and procedures as it
deems necessary or appropriate regarding the timing of the distributions made
pursuant to this Article VIII. Such rules may provide for the manner in which
the timing of such distributions will relate to the Plan's Valuation Dates and
also may allow a Participant to elect to defer the distribution of his Vested
Interest (subject, however, to Section 8.11 requiring distributions to be made
within specified time periods).
8.10 FORM OF DISTRIBUTIONS.
(a) A Participant's benefit shall be calculated based on
the number of shares of Company Stock allocated and credited to the
Participant's Company Stock Account and the number of shares of Company
Stock (valued as of the Applicable Valuation Date for such stock) that
can be acquired with the dollar value (valued as of the Applicable
Valuation Date for such assets but increased by the amount of dividends
received since that date) of the assets in his Other Investments Account
as of the date on which the benefit is to be distributed.
(b) The number of shares of Company Stock allocated to the
Participant's Company Stock Account as of any date of reference shall
also include any shares allocated after that date (but prior to the
actual distribution of such Participant's benefit) under Section 6.9 by
reason of a stock split, dividend, etc.
(c) Upon determining the number of shares in the
Participant's Company Stock Account and the dollar value of his Other
Investments Account as of the pertinent date(s) referred to above, a
Participant's benefit shall be determined by applying the value (if any)
of his Other Investments Account (to the extent not forfeited) towards
the purchase of Company Stock, with the objective of obtaining the
maximum number of whole shares of Company Stock for distribution to the
Participant by combining any fractional shares so acquired with
fractional shares credited to his Company
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Stock Accounts. The value of any fractional shares of Company Stock
shall be distributed in cash.
(d) If in connection with any such distribution
sufficient Company Stock is not immediately available for purchase by
the Trustee, then the balance of the Participant's Other Investments
Account shall be distributed in cash to the Participant together with
the shares of Company Stock allocated to his Company Stock Account.
(e) If more than one class of Leveraged Company Stock
is available for distribution to a Participant, the Participant must
receive substantially the same proportion of each such class of stock.
8.11 REQUIRED PAYMENT DATES.
(a) Notwithstanding anything to the contrary in this
Plan, payment of a lump sum distribution of the Participant's entire
Vested Interest under the Plan shall be made no later than the
Participant's Required Benefit Commencement Date, which shall be the
earlier of the dates described in Subparagraphs (i) and (ii)
hereinbelow:
(i) The 60th day after the close of the Plan Year
in which the latest of the following events occurs: (A) the
Participant's Normal Retirement Date; (B) the 10th anniversary of
the Participant's Participation Commencement Date; or (C) the
termination of the Participant's employment with the Company
and its Affiliated Companies.
(ii) (A) Except as provided in (B) below, the
April 1 following the calendar year in which the
Participant attains age 70-1/2, whether or not such
Participant has incurred a Severance or whether or not the
Participant consents to the distribution.
(B) Except in the case of a Participant who
is a "5-percent owner" within the meaning of Section
401(a)(9) of the Code, for a Participant who attained age
70-1/2 prior to January 1, 1988, the April 1 following the
later of the calendar year in which the Participant
attains age 70-1/2, or the calendar year in which the
Participant incurs a Severance.
(b) Notwithstanding anything to the contrary in this Plan,
if a Participant dies prior to receiving a
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distribution of his benefit such Participant's benefit shall be
distributed within five years after the Participant's death (either to
his Spouse (if any) or to such other eligible Beneficiary determined
under the provisions of Section 8.5).
(c) If it is not administratively practicable to calculate
and commence payments by the latest date specified in the rules of
Paragraphs (a) and (b) above because the amount of the Participant's
benefit cannot be calculated, or because the Committee is unable to
locate the Participant after making reasonable efforts to do so, the
payment shall be made as soon as it is administratively possible (but
not more than 60 days) after the earliest date on which the Participant
(or Beneficiary) can be located and the amount of the distributable
benefit can be ascertained.
8.12 PAYEES UNDER LEGAL DISABILITIES.
If any payee under the Plan is a minor, or if the Committee
reasonably believes that any payee is legally incapable of giving a valid
receipt and discharge for any payment due him, the Committee may have the
payment, or any part of it, made to the person (or persons or institution) whom
it reasonably believes is caring for or supporting such payee, or, if
applicable, to any duly appointed guardian, committee or other authorized
representative of such payee. Any such payment shall be a payment for the
account of the payee and shall, to the extent thereof, be a complete discharge
of any liability under the Plan to such payee.
8.13 ADDITIONAL DOCUMENTS.
The Committee or Trustee, or both, may require the execution and
delivery of such documents, papers and receipts as the Committee or Trustee may
determine necessary or appropriate in order to establish the fact of death of
the deceased Participant and of the right and identity of any Beneficiary or
other person or persons claiming any benefits under this Article VIII. The
Committee or the Trustee, or both, may, as a condition precedent to the payment
of death benefits hereunder, require an inheritance tax release and/or such
security as the Committee or Trustee, or both, may deem appropriate as
protection against possible liability for State or Federal death taxes
attributable to any death benefits.
8.14 LIMITED OPTION TO SELL DISTRIBUTED COMPANY STOCK.
Solely in the event that a Participant receives a distribution
consisting in whole or in part of Company Stock that at the time of distribution
thereof is not Freely Tradeable Stock within the meaning of Section 2.29
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hereinabove, then such distributed Company Stock shall be made subject to a put
option in the hands of a Qualified Holder (as defined hereinbelow), with such
put option to be subject to the following provisions:
(a) As used herein, the term "Qualified Holder" shall mean
the Participant or Beneficiary receiving the distribution of such
Company Stock, any other party to whom such stock is transferred by gift
or by reason of death, and also any trustee of an Individual Retirement
Account (as defined under Code Section 408) to which all or any portion
of such distributed Company Stock is transferred pursuant to a tax-free
"rollover" transaction satisfying the requirements of Code Section 402.
(b) During the 60-day period following any distribution of
such Company Stock, a Qualified Holder shall have the right to require
the Company to purchase all or any portion of said distributed Company
Stock held by said Qualified Holder. A Qualified Holder shall exercise
such right by giving written notice to the Company within the aforesaid
60-day period of the number of shares of distributed Company Stock that
such Qualified Holder intends to sell to the Company. The purchase price
to be paid for any such Company Stock shall be its fair market value
determined as of the Applicable Valuation Date coincident with or
immediately preceding the date of the distribution (subject to the
special valuation rules for Leveraged Company Stock in Section 10.3).
(c) If a Qualified Holder shall fail to exercise his put
option right under Paragraph (b), above, such option right shall
temporarily lapse upon the expiration of the 60-day period thereof. As
soon as is reasonably practicable following the Anniversary Date of the
Plan Year in which said 60-day option period expires, the Company shall
notify each such non-electing Qualified Holder who is then a shareholder
of record of the valuation of such Company Stock as of said Anniversary
Date. During the 60-day period following receipt of such valuation
notice, any such Qualified Holder shall have the right to require the
Company to purchase all or any portion of such distributed Company
Stock. The purchase price to be paid therefor shall be based on said
Anniversary Date valuation of such Company Stock. If a Qualified Holder
fails to exercise his option right under this Paragraph with respect to
any portion of such distributed Company Stock, no further options shall
be applicable under this Plan and the Company shall have no further
purchase obligations hereunder.
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(d) In the event that a Qualified Holder shall exercise a
put option under this Section, then the Company shall have the option of
paying the purchase price of the Company Stock which is subject to such
put option (hereafter the "Option Stock") under either of the following
methods:
(i) A lump sum payment of the purchase price within
90 days after the date upon which such put option is exercised
(the "Exercise Date") or
(ii) A series of six equal installment payments,
with the first such payment to be made within 30 days after the
Exercise Date and the five remaining payments to be made on the
five anniversary dates of the Exercise Date, so that the full
amount shall be paid as of the fifth anniversary of such Exercise
Date. If the Company elects to pay the purchase price of the
Option Stock under the installment method provided in this
subparagraph (ii), then the Company shall, within 30 days after
the Exercise Date, give the Qualified Holder who is exercising
the put option the Company's promissory note for the full unpaid
balance of the option price. Such note shall, at a minimum,
provide adequate security (if required under applicable
regulations), state a rate of interest reasonable under the
circumstances but at least equal to the imputed compound rate in
effect as of the Exercise Date pursuant to the Treasury
Regulations promulgated under Code Section 483 or 1274, whichever
shall be applicable, and provide that the full amount of such
note shall accelerate and become due immediately in the event
that the Company defaults in the payment of a scheduled
installment payment.
(e) The foregoing put options under Paragraphs (b) and (c)
shall be effective solely against the Company and shall not obligate the
Plan in any manner; provided, however, with the Company's consent the
Plan may elect to purchase any Company Stock that otherwise must be
purchased by the Company pursuant to a Qualified Holder's exercise of
any such option.
(f) If at the time of any distribution of said Company
Stock it is known that any applicable Federal or State law would be
violated by the Company's honoring of such a put option as provided
under this Section, the Company shall designate another entity that will
honor such put option. Such other entity shall be one having a
substantial net worth at the time such loan is made and
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whose net worth is reasonably expected to remain substantial.
(g) In the event that a Qualified Holder is unable to
exercise the put option provided hereunder because the Company (or other
entity bound by such put option) is prohibited from honoring it by
reason of any applicable Federal or State law, then the 60-day option
periods during which such put option is exercisable under Paragraphs (b)
and (c) shall not include any such time during which said put option may
not be exercised due to such reason.
(h) Except as is expressly provided above with respect to
any distributed Company Stock that is not Freely Tradeable Stock, as
defined under Section 2.29, no Participant shall have any put option
rights with respect to Company Stock distributed under this Plan, and
neither the Company nor this Plan shall have any obligation whatsoever
to purchase any such distributed Company Stock from any Participant or
other Qualified Holder.
(i) At the time of distribution of Company Stock that is
not Freely Tradeable Stock to a Participant or Beneficiary, the Company
shall furnish to such Participant or Beneficiary the most recent annual
certificate of value prepared by the Company with respect to such Stock
in accordance with the provisions of Section 6.12. In addition, the
Company shall furnish to such Participant or Beneficiary a copy of each
subsequent annual certificate of value until the put options provided
for in this Section with respect to such distributed Company Stock shall
expire.
(j) Notwithstanding the provisions of Paragraph (b) or (c)
above and to the extent permitted by applicable law, Pretransaction
Shares (as defined below) of Company Stock shall be purchased by the
Company and the purchase price to be paid for any such Shares shall be
the greater of $12.00 per share or their fair market value determined as
of the Applicable Valuation Date coincident with or immediately
preceding the date of the distribution (subject to the special valuation
rules for Leveraged Company Stock in Section 10.3). For purposes of this
Paragraph (j), the term "Pretransaction Shares" shall mean any of the
8,466 shares Of Company Stock held by the Plan as of October 17, 1988.
The provisions of this Paragraph (j) shall be effective only so long as
there remains a principal balance on any indebtedness incurred with
respect to the acquisition of Company Stock other than Pretransaction
Shares.
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8.15 TRANSFER OF DISTRIBUTED COMPANY STOCK--RIGHT OF FIRST REFUSAL FOR THE
COMPANY AND THE PLAN.
(a) Solely in the event that a Qualified Holder (as
defined in section 8.14(a) of this Plan) desires to transfer Company
Stock distributed under this Plan which at the time of the proposed
transfer is not "publicly traded," as that term is defined under
Treasury Regulation Section 54.4975-7(b)(1)(iv) or any successor
thereto, then the transfer of such Company Stock (hereinafter the
"Subject Stock") shall be subject to a right of first refusal on behalf
of the Company and the Plan as described in this Section.
Notwithstanding the foregoing, however, a transfer of such Subject Stock
shall not be subject to the right of first refusal set forth in this
Section if the transferee of such Subject Stock will be a Qualified
Holder with respect to such Subject Stock.
(b) Subject to the right of first refusal set forth in
this Section, Subject Stock may be transferred so long as the
transferring shareholder gives the Committee written notice of the
intended transfer (the "Notice of Transfer") at least fourteen (14) days
prior to the date of transfer. Such notice shall be given to the
Committee in the manner specified in Section 18.4 of the Plan and shall
specify the following:
(i) The name and address of the Qualified Holder
of such Subject Stock who intends to transfer such stock;
(ii) The name and address of the intended
transferee;
(iii) The number of shares to be transferred; and
(iv) The price and terms of the proposed transfer.
Receipt of such a Notice of Transfer by the Committee shall be deemed to
be receipt thereof by the Plan and the Company. Any attempts to transfer
Subject Stock without first giving the notice required by this Paragraph
shall be null and void, and shall give the purported transferee no
rights as against the Company and the Plan, except that a Notice of
Transfer shall not be required with respect to a transfer of Subject
Stock to a person who will be a Qualified Holder with respect to such
Subject Stock.
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(c) Upon receipt of a Notice of Transfer with respect
to a proposed transfer of Subject Stock, the Company and the Plan shall
have fourteen (14) days to elect to purchase such Subject Stock on the
terms and conditions set forth in Paragraph (d) below. Such election
shall be exercised by written notice from the Company or the Plan, as
the case may be, delivered to the shareholder proposing to transfer such
Subject Stock at the address set forth in the Notice of Transfer
pertaining thereto. In the event that both the Company and the Plan
exercise their right of first refusal hereunder, the Company's right
shall take precedence.
(d) The right of first refusal set forth herein shall
be exercisable with respect to Subject Stock upon whichever of the
following terms and conditions is more favorable to the Qualified Holder
who proposes to transfer such Subject Stock:
(i) The price and terms of the proposed transfer,
as set forth in the Notice of Transfer with respect thereto, or
(ii) A lump sum payment of the value of such
Subject Stock as determined upon the most recent Account
Valuation Date, except that in the case of a proposed transfer by
a Qualified Holder who is a "disqualified person" within the
meaning of Section 4975(e)(2) of the Internal Revenue Code, such
lump sum payment shall be in an amount equal to the value of said
Subject Stock determined as of the date of the exercise by the
Company or the Plan, as the case may be, of its right of first
refusal with respect to such Subject Stock. Such lump sum payment
shall be made to the Qualified Holder who prepares to transfer
such Subject Stock simultaneously with the delivery by such
Qualified Holder to the party exercising its right of first
refusal hereunder (the "Purchaser") of certificates representing
ownership of all such Subject Stock, which certificates shall be
properly endorsed so as to transfer title in such Subject Stock
to the Purchaser free and clear of any liens or other
encumbrances; provided, however, that in no event shall the
Purchaser be required to make such lump sum payment prior to the
fourteenth (14th) day following the receipt by the Purchaser of
the Notice of Transfer with respect to such Subject Stock.
8.16 ELECTION FOR DIRECT ROLLOVER OF VESTED INTEREST TO ELIGIBLE RETIREMENT
PLAN.
(a) To the extent required by Section
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401(a)(31) of the Code, a Participant whose Vested Interest becomes
payable in an "eligible rollover distribution," as defined in (b)(i)
below, shall be entitled to make an election for a direct rollover of
all or a portion of the taxable portion of such Vested Interest to an
"eligible retirement plan," as defined in (b)(ii) below. For purposes of
this Article VIII, a Participant who makes a direct rollover election in
accordance with this Section 8.16 shall be deemed to have received
payment of his Vested Interest as of the date payment is made from the
Plan.
(b) For purposes of this Section,
(i) an "eligible rollover distribution" shall mean
any distribution of all or any portion of a Participant's Vested
Interest, except that an eligible rollover distribution shall not
include: 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
Participant or the joint lives (or joint life expectancies) of
the Participant and the Participant's designated Beneficiary, or
for a specified period of ten years or more; any distribution to
the extent such distribution is required under Section 401(a)(9)
of the Code; and the portion of any distribution that is not
includible in gross income (determined without regard to the
exclusion for net unrealized appreciation with respect to
employer securities), and
(ii) an "eligible retirement plan" shall mean any
plan described in Code Section 402(c)(8)(B), the terms of which
permit the acceptance of a direct transfer from a qualified plan.
(c) A Participant's direct rollover election under this
Section shall be made in accordance with rules and procedures
established by the Committee and shall specify the dollar or percentage
amount of the direct rollover, the name and address of the eligible
retirement plan selected by the Participant and such additional
information as the Committee deems necessary of appropriate in order to
implement the Participant's election. It shall be the Participant's
responsibility to confirm that the eligible retirement plan designated
in the direct rollover election will accept the eligible rollover
distribution. The Administration Committee shall be entitled to effect
the direct rollover based on its reasonable reliance on information
provided by the
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Participant, and shall not be required to independently verify such
information, unless it is clearly unreasonable not to do so.
(d) At least thirty (30) days, but not more than
ninety (90) days, prior to the date a Participant's Vested Interest
becomes payable, the Participant shall be given written notice of any
right he may have to elect a direct rollover of his eligible rollover
distribution; provided, however, a Participant who has received the
direct rollover notice may waive the thirty (30) day requirement by
making an affirmative election to make or not to make a direct rollover
of all or a portion of his Vested Interest.
(e) If a Participant whose Vested Interest becomes
payable in accordance with this Article VIII fails to file a direct
rollover election with the Committee within ninety (90) days after
receipt of the direct rollover notice, or if the Committee is unable to
effect the rollover within a reasonable time after the election is filed
with the Committee due to the failure of the Participant to take such
actions as may be required by the eligible retirement plan before it
will accept the rollover, the Participant's Vested Interest shall be
paid to him, after withholding applicable income taxes, if any.
(f) If the eligible retirement plan specified by the
Participant will not accept a direct rollover of any Company Stock
includible in the distribution of the Participant's Vested Interest,
such Company Stock will be distributed to the Participant.
(g) To the extent required by Section 401(a)(31) of
the Code, if all or a portion of a Participant's Vested Interest is
payable to his surviving Spouse in an eligible rollover distribution, or
to a former Spouse in accordance with a "qualified domestic relations
order," such surviving Spouse or former Spouse shall be entitled to
elect a direct rollover of all or a portion of such distribution to an
individual retirement account or an individual retirement annuity in
accordance with the provisions of this Section.
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ARTICLE IX
OPERATION AND ADMINISTRATION OF THE PLAN
9.1 PLAN ADMINISTRATION.
(a) Authority to control and manage the operation and
administration of the Plan shall be vested in the Retail Merchandising
Service Automation, Inc. Employee Stock Ownership Plan Committee
("Committee").
(b) The Committee shall have from three to seven members,
all of whom shall be appointed by the Board of Directors and shall hold
office until resignation, death or removal by the Board of Directors.
(c) The members of the Committee shall be the Named
Fiduciaries of this Plan within the meaning of Section 402(a) of ERISA.
(d) For purposes of inspection by Employees and other
eligible parties, the Secretary of the Committee shall maintain at the
office of the Committee, or another appropriate location, a copy of the
Plan and an accurate schedule listing the names of all persons from time
to time serving as the Named Fiduciaries of the Plan.
(e) Notwithstanding the foregoing, a trustee or an
Investment Manager appointed pursuant to Section 9.3 may be granted
exclusive authority and discretion to manage and control all or any
portion of the assets of the Plan.
9.2 COMMITTEE POWERS.
The Committee shall have all powers necessary to supervise the
administration of the Plan and control its operations. In addition to any powers
and authority conferred on the Committee elsewhere in the Plan or by law, the
Committee shall have, by way of illustration and not by way of limitation, the
following powers and authority:
(a) To allocate fiduciary responsibilities (other than
Trustee Responsibilities) among the Named Fiduciaries and to designate
one or more other persons to carry out fiduciary responsibilities (other
than Trustee Responsibilities). However, no allocation or delegation
under this Section 9.2(a) shall be effective until the person or persons
to whom such responsibilities have been allocated or delegated agree to
assume such responsibilities. The term "Trustee Responsibilities" shall
have the meaning set forth in Section 405(c) of
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ERISA. The preceding provisions of this Section 9.2(a) shall not limit
the authority of the Committee to appoint one or more Investment
Managers in accordance with Section 9.3.
(b) To designate agents to carry out responsibilities
relating to the Plan, other than fiduciary responsibilities.
(c) To employ such legal, actuarial, medical, accounting,
clerical and other assistance as it may deem appropriate in carrying out
the provisions of this Plan, including one or more persons to render
advice with regard to any responsibility any Named Fiduciary or any
other fiduciary may have under the Plan.
(d) To establish rules and regulations from time to time
for the conduct of the Committee's business and the administration and
effectuation of this Plan.
(e) To administer, interpret, construe and apply this Plan
and to decide all questions which may arise or which may be raised under
this Plan by any Employee, Participant, former Participant, Beneficiary
or other person whatsoever, including but not limited to all questions
relating to eligibility to participate in the Plan, the number of Years
of Service of any Participant, and the amount of benefits to which any
Participant or his Beneficiary may be entitled by reason of his service
prior to or after the Effective Date hereof.
(f) To determine the manner in which the assets of this
Plan, or any part thereof, shall be disbursed.
(g) To direct the Trustee, in writing, from time to time,
to invest and reinvest the Trust Fund, or any part thereof, or to
purchase, exchange or lease any property, real or personal, that the
Committee may designate. This shall include the right to direct the
investment of all or any part of the Trust Fund in any one security or
one type of security permitted hereunder. Among the securities that the
Committee may direct the Trustee to purchase are "Qualifying Employer
Securities" as defined in Code Section 4975(e).
(h) To perform or cause to be performed such further acts
as it may deem to be necessary, appropriate or convenient in the
efficient administration of the Plan.
Subject to the provisions of Article XIII, any action taken in good faith by the
Committee in the exercise of authority
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conferred upon it by this Plan shall be conclusive and binding upon the
Participants and their Beneficiaries. All discretionary powers conferred upon
the Committee shall be absolute; provided, however, all such discretionary power
shall be exercised in a uniform and nondiscriminatory manner.
9.3 INVESTMENT MANAGER.
(a) Notwithstanding anything in this Article IX to the
contrary, the Committee, by action reflected in the minutes thereof, may
appoint one or more Investment Managers, as defined in Section 3(38) of
ERISA, to manage all or a portion of the assets of the Plan.
(b) An Investment Manager shall discharge its duties in
accordance with applicable law and in particular in accordance with
Section 404(a)(l) of ERISA.
(c) An Investment Manager, when appointed, shall have full
power to manage the assets of the Plan for which it has responsibility,
and neither the Company, the Committee, nor any other Plan fiduciary
(other than the Investment Manager and its representatives and agents)
shall thereafter have any responsibility for the management of such
assets, except as otherwise provided by law.
9.4 FUNDING POLICY.
At periodic intervals, not less frequently than annually, the
Committee shall review the long-run and short-run financial needs of the Plan
and shall determine a funding policy for the Plan consistent with the objectives
of the Plan and any requirements of applicable law. In determining such funding
policy the Committee shall take into account not only the long-term investment
objectives of the Trust Fund consistent with the prudent management of the
assets thereof, but also the short-run needs of the Plan to pay retirement
benefits. All actions taken by the Committee with respect to the funding policy
of the Plan, including the reasons therefor, shall be fully reflected in the
minutes of the Committee.
9.5 COMMITTEE PROCEDURE.
(a) A majority of the members of the Committee as
constituted at any time shall constitute a quorum, and any action by a
majority of the members present at any meeting, or authorized by a
majority of the members in writing without a meeting, shall constitute
the action of the Committee.
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(b) The Committee may designate certain of its members as
authorized to execute any document or documents on behalf of the
Committee, in which event the Committee shall notify the Trustee of this
action and the name or names of the designated members. The Trustee,
Company, Participants, Beneficiaries, and any other party dealing with
the Committee may accept and rely upon any document executed by the
designated members as representing action by the Committee until the
Committee shall file with the Trustee a written revocation of the
authorization of the designated members.
(c) Any person dealing with the Committee may rely on and
shall be fully protected in relying on a certificate or memorandum in
writing signed by any Committee member or other person so authorized, or
by the majority of the members of the Committee, as constituted as of
the date of such certificate or memorandum, as evidence of any action
taken or resolution adopted by the Committee.
9.6 COMPENSATION OF COMMITTEE AND PLAN EXPENSES.
(a) Members of the Committee shall serve as such without
compensation unless the Board of Directors shall otherwise determine.
However, in no event shall any member of the Committee who receives
full-time pay from the Company receive compensation from the Plan for
his services as a member of the Committee.
(b) All members shall be reimbursed for any necessary
expenditures incurred in the discharge of duties as members of the
Committee.
(c) The compensation or fees, as the case may be, of all
officers, agents, counsel, the Trustee, or other persons retained or
employed by the Committee shall be fixed by the Committee, subject to
approval by the Board of Directors.
(d) The expenses incurred in the administration and
operation of the Plan, including but not limited to the expenses
incurred by the members of the Committee in exercising their duties,
shall be borne by the Company.
(e) Notwithstanding the provisions of Paragraph (d) above,
the cost of interest and normal brokerage charges which are included in
the cost of securities purchased by the Trust Fund (or charged to
proceeds in the case of sales) shall be charged and allocated in a fair
and equitable manner to the Other
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Investments Accounts to which the securities are allocated.
9.7 RESIGNATION AND REMOVAL OF MEMBERS.
Any member of the Committee may resign at any time by giving
written notice to the other members and to the Board of Directors of the
Company, effective as therein stated. Any member of the Committee may, at any
time, be removed by the Board of Directors. In the case of a Committee member
who is also an Employee of the Company, his status as a Committee member shall
terminate as of the effective date of the termination of his employment, except
as otherwise provided by the Board of Directors.
9.8 APPOINTMENT OF SUCCESSORS.
(a) Upon the death, resignation, or removal of any
Committee member, the Board of Directors may appoint a successor.
(b) Notice of appointment of a successor member shall be
given by the Secretary of the Company in writing to the Trustee and to
the members of the Committee.
(c) Upon the termination, for any reason, of a Committee
member's status as a member of the Committee, the member's status as a
Named Fiduciary shall concurrently be terminated, and upon the
appointment of a successor Committee member the successor shall assume
the status of a Named Fiduciary as provided in Section 9.l.
9.9 RECORDS.
(a) The Committee shall keep a record of all of its
proceedings and shall keep, or cause to be kept, all books, accounts,
records or other data as may be necessary or advisable in its judgment
for the administration of the Plan and properly to reflect the affairs
thereof, and to satisfy the requirements of ERISA Section 107.
(b) However, nothing in this Section shall require the
Committee or any member thereof to perform any act which, pursuant to
law or the provisions of this Plan, is the responsibility of the Plan
Administrator under Section 18.5, nor shall this Section relieve the
Plan Administrator of such responsibility.
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9.10 RELIANCE UPON DOCUMENTS AND OPINIONS.
(a) The members of the Committee, the Board of Directors,
the Company and any person delegated the authority to carry out any
fiduciary responsibilities under the Plan ("Delegated Fiduciary"), shall
be entitled to rely upon (i) any tables, valuations, computations,
estimates, certificates or reports furnished by any consultant, or firm
or corporation which employs one or more consultants, (ii) any opinions
furnished by legal counsel, and (iii) any reports furnished by the
Trustee. The members of the Committee, the Board of Directors, the
Company, and any Delegated Fiduciary shall be fully protected and shall
not be liable in any manner whatsoever for anything done or action taken
or suffered in reliance upon any such consultant or firm or corporation
which employs one or more consultants or counsel, except as otherwise
provided by law.
(b) Any and all things done or actions taken or suffered
by the Committee, the Board of Directors, the Company and any Delegated
Fiduciary shall be conclusive and binding on all Employees,
Participants, Beneficiaries, and any other persons whomsoever, except as
otherwise provided by law.
(c) The Committee and any Delegated Fiduciary may, but are
not required to, rely upon all records of the Company with respect to
any matter or thing whatsoever, and may likewise treat those records as
conclusive with respect to all Employees, Participants, Beneficiaries,
and any other persons whomsoever, except as otherwise provided by law.
9.11 REQUIREMENT OF PROOF.
The Committee, the Board of Directors or the Company may require
satisfactory proof of any matter under this Plan from or with respect to any
Employee, Participant, or Beneficiary, and no person shall be entitled to
receive any benefits under this Plan until that proof shall be furnished.
9.12 RELIANCE ON COMMITTEE MEMORANDUM.
Any person dealing with the Committee may rely on and shall be
fully protected in relying on a certificate or memorandum in writing signed by
any Committee member or other person so authorized, or by the majority of the
members of the Committee, as constituted as of the date of the certificate or
memorandum, as evidence of any action taken or resolution adopted by the
Committee.
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9.13 MULTIPLE FIDUCIARY CAPACITY.
Any person or group of persons may serve in more than one
fiduciary capacity with respect to the Plan.
9.14 LIMITATION ON LIABILITY.
(a) Except as provided in Part 4 of Title I of ERISA, no
person shall be subject to any liability with respect to his duties
under the Plan unless he acts fraudulently or in bad faith.
(b) No person shall be liable for any breach of fiduciary
responsibility resulting from the act or omission of any other fiduciary
or any person to whom fiduciary responsibilities have been allocated or
delegated, except as provided in Part 4 of Title I of ERISA.
(c) No action or responsibility shall be deemed to be a
fiduciary action or responsibility except to the extent required by
ERISA.
9.15 INDEMNIFICATION.
To the extent permitted by law, the Company shall indemnify each
member of the Committee, and any other Employee of the Company with duties under
the Plan, against expenses (including any amount paid in settlement of claims)
reasonably incurred by him in connection with any claims against him by reason
of his conduct in the performance of his duties under the Plan, except in
relation to matters as to which he acted fraudulently or in bad faith in the
performance of those duties. The preceding right of indemnification shall be in
addition to any other right to which any such Committee member or other person
may be entitled as a matter of law or otherwise, and shall pass to the estate of
a deceased Committee member. For purposes of satisfying its indemnity
obligations under this Section, the Company may (but need not) purchase and pay
premiums for one or more policies of insurance. However, this insurance shall
not release the Company of its liability under this section.
9.16 BONDING.
All Employees handling Plan Assets shall be bonded as required by
ERISA Section 412.
9.17 ALLOCATION OF FIDUCIARY RESPONSIBILITY.
(a) Part 4 of Title I of ERISA permits the division,
allocation and delegation between Plan fiduciaries of the fiduciary
responsibilities owed to the
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Plan Participants. Under this concept, each fiduciary, including a Named
Fiduciary, is accountable only for his own functions, except to the
extent of co-fiduciary liability under Section 405 of ERISA.
(b) Under the preceding provisions of this Article IX,
the day-to-day operational, administrative and investment aspects of the
Plan have been delegated to the Committee. Such responsibilities
delegated to the Committee shall include, by way of illustration but not
by way of limitation, such matters as:
(i) Making contributions to the Trust in a timely
manner;
(ii) Satisfying accounting and auditing
requirements;
(iii) Satisfying reporting requirements;
(iv) Satisfying record keeping requirements;
(v) Satisfying insurance and bonding requirements;
(vi) Administering the Plan's claims procedure;
(vii) Continuing review of developments in the
employee plans area, including court decisions, and
pronouncements issued by the Internal Revenue Service and the
Department of Labor; and
(viii) Appointing Investment Managers.
9.18 VOTING AND OTHER RIGHTS OF COMPANY STOCK.
All voting rights of Company Stock held by the Trust Fund shall
be exercised by the Trustee as directed by the Committee in accordance with the
following provisions of this Section:
(a) All Leveraged Company Stock held in the Suspense
Account and any other Company Stock not yet allocated to Participants'
Company Stock Accounts shall be voted as the Committee directs in its
absolute discretion. With respect to all corporate matters, any Company
Stock, whether or not Leveraged Company Stock, allocated to the Company
Stock Account of a Participant shall be voted in accordance with the
directions of such Participant as given to the Committee and
communicated in turn by the Committee to the Trustee. Each Participant
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shall be entitled to direct only the voting of the Company Stock
(including fractional shares or fractional rights to shares) allocated
to his Company Stock Account.
(b) All Participants entitled to direct such voting shall
be notified by the Committee (or the Company, pursuant to its normal
communications with shareholders) of each occasion for the exercise of
such voting rights within a reasonable time before such rights are to be
exercised. Such notification shall include all information distributed
to shareholders by the Company regarding the exercise of such rights.
Such Participants shall be so entitled to direct the voting of
fractional shares (or fractional rights to shares), provided, however,
that the Committee may, to the extent possible, direct the Trustee to
vote the combined fractional shares (or fractional rights to shares) so
as to reflect the aggregate direction of all Participants giving
directions with respect to fractional shares (or fractional rights to
shares). In the event that a Participant shall fail to direct the
Committee in whole or in part as to the exercise of voting rights
arising under any Company Stock credited to his Company Stock Accounts,
then such voting rights shall be exercised only to the extent directed
by such Participant. Each Participant shall be a named fiduciary (as
that term is defined in ERISA Section 402(a)(2)), with respect to
Company Stock for which he has the right to direct the voting under the
Plan, but solely for the purpose of exercising voting rights pursuant to
this Section 9.18.
(c) All rights (other than voting rights) of Company Stock
held in the Trust Fund, including such Stock held in the Suspense
Account as well as such Stock credited to the Company Stock Accounts of
Participants, shall be exercised in the same manner and to the same
extent as provided above with respect to the voting rights of such
Company Stock.
(d) The Committee shall in no event make any
recommendation to any Participant regarding the exercise of such
Participant's voting rights or any other rights under the provisions of
this Section, nor shall the Committee make any such recommendation as to
whether any such rights should or should not be exercised by any such
Participant.
9.19 PROHIBITION AGAINST CERTAIN ACTIONS.
(a) In administering this Plan, the Committee shall not
discriminate in favor of any class of Employees and particularly it
shall not discriminate in favor of
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highly compensated Employees, or Employees who are officers or
shareholders of the Company.
(b) Also, the Committee shall not cause the Plan to engage
in any transaction that constitutes a nonexempt Prohibited Transaction
under Section 4975(c) of the Code or Section 406(a) of ERISA.
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ARTICLE X
LEVERAGED COMPANY STOCK ACQUISITIONS
10.1 LEVERAGED COMPANY STOCK ACQUISITIONS AUTHORIZED.
In addition to the Committee's powers and authority set forth in
the provisions of Article IX, the Committee shall have the power to direct the
Trustee to borrow or raise money, in such amounts and under such conditions and
terms as directed by the Committee, for the purpose of purchasing or otherwise
acquiring Company Stock. Any such borrowing may be made from the Company, any
shareholder in the Company, or from any other party. In connection with any such
borrowing, and subject to any applicable margin requirement rule, regulation or
statute, the Committee may direct the Trustee to issue its promissory note on
behalf of the Trust. No person lending money to the Trustee shall be obligated
to see to the application of the money lent or to inquire into the validity,
expediency or propriety of such borrowing. Any such borrowing from the Company,
or from any other "disqualified person" within the meaning of Code Section
4975(e)(2), or any other "party in interest" within the meaning of ERISA Section
3(14), shall be subject to the following provisions:
(a) The proceeds of the loan shall be used (within a
reasonable period of time after receipt) only to acquire Company Stock,
to pay any charges or fees incurred in connection with the stock
acquisition or loan, and/or to make payments under any such loan
(including prior loans).
(b) Other than the categories of assets specified in
Paragraph (c) below, the loan shall be without recourse against the Plan
or Trust. The only Trust assets which may be used as collateral for the
loan shall be the Company Stock acquired with the proceeds of the loan
or Company Stock used as collateral on a prior loan that was repaid with
the current outstanding loan.
(c) No person entitled to payment under the loan shall
have any recourse, for any payments due under the loan, against any Plan
assets other than the following categories of assets:
(i) Unallocated Leveraged Company Stock (whether
or not collateralized) acquired with the proceeds of the loan
and held in the Suspense Account (but only prior to the release
therefrom and allocation to Participants' Accounts as provided
under this Plan);
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(ii) Company Contributions (other than
contributions of Company Stock) made to meet obligations under
the loan;
(iii) Earnings attributable to the unallocated
Leveraged Company Stock while held in the Suspense Account
(including dividends thereon and the proceeds from any sale
thereof while held in the Suspense Account); and
(iv) Earnings attributable to the investment of
the Company Contributions made to meet obligations under the
loan.
Recourse against such assets shall be permissible to the extent allowed
under applicable law governing creditor's remedies, but in no event to
an extent greater than permitted under Paragraph (d) below or such other
applicable limitations as may be required in order for such loan
transaction to qualify for the prohibited transaction exemption provided
under Code Section 4975(d)(3).
(d) The provisions of this Paragraph (d) shall apply
in case of a default in the repayment of the loan:
(i) In the event of a default, the value of Plan
assets transferred to the lender in satisfaction of such loan
shall not exceed the amount of the default.
(ii) If the lender is a disqualified person (as
defined in Code Section 4975(e)(2)), a transfer of Plan assets
upon default shall be made only upon and to the extent of the
failure of the Plan to meet the payment schedule of the loan.
(iii) For purposes of this Paragraph (d), the
making of a guarantee by the Company shall not be deemed to make
the Company a lender; provided, however, that this provision
shall not impose any personal liability on the Trustee.
(e) The terms of the loan must provide that shares of
the Company Stock purchased with the proceeds of the loan shall be
placed in a Suspense Account. The shares in the Suspense Account shall
be released from the Suspense Account (and allocated to the Company
Stock Accounts) in accordance with the following rules:
(i) For each Plan Year, the number of shares
released from their status as collateral shall equal the number
of shares held immediately
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before that release multiplied by the "Release Fraction."
(ii) The term "Release Fraction" means a fraction
the numerator of which is the amount of principal and interest
paid on the loan during the current Plan Year and the denominator
of which is the sum of the numerator plus the principal and
interest to be paid on the loan in all future years during the
duration of the term of the loan. For purposes of computing the
Release Fraction, the duration of the loan shall be determined
without reference to any possible extensions or renewals of the
loan. If the interest rate charge under the loan is variable, the
interest to be paid in future years shall be computed by using
the interest rate applicable as of the end of the Plan Year with
respect to which the contributions are being made.
(iii) If the collateral includes more than one
class of securities, the number of securities of each class to be
released for a Plan Year shall be determined by applying the
Release Fraction to each of the classes of securities.
(iv) It is intended that the preceding provisions
shall be applied and construed in a manner consistent with the
requirements and provisions of Treasury Regulation Section
54.4975-7(b)(8).
Notwithstanding the foregoing, in addition to or in lieu of pledging the
acquired Company Stock as collateral for the repayment of any loan, the
Company may guarantee the repayment and/or may use Company assets to
secure the repayment, and nothing herein shall require that the
repayment of the loan be secured by Company Stock acquired with the
proceeds thereof.
(f) If the proceeds of a loan are used to acquire
Leveraged Company Stock, the following items shall be accounted for
separately in the books of account of the Plan until the loan is repaid:
(i) The Company Contributions (other than
contributions of Company Stock) that are made under the Plan to
meet obligations under the loan;
(ii) The earnings attributable to unallocated
Leveraged Company Stock (purchased with the proceeds of the loan)
while held in the Suspense Account (including dividends thereon);
and
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(iii) Earnings attributable to the investment of
the Company Contributions made to meet obligations under the
loan.
(g) In the event that there shall be more than one
class of stock of the Company, the class or classes of Leveraged Company
Stock acquired by the Trustee with the proceeds of the loan, and the
relative proportions of the classes of Stock held by the Trustee, shall
comply with any applicable requirements established pursuant to
regulations issued by the Secretary of the Treasury under Code Section
4975 so as to insure that the loan and/or the acquisition of Leveraged
Company Stock does not constitute a prohibited transaction within the
meaning of the applicable provisions of the Code and ERISA.
(h) The loan shall be primarily for the benefit of
Participants and their Beneficiaries and shall bear no more than a
reasonable rate of interest.
(i) The Committee shall determine, and advise the
Trustee with respect to, the amount of interest charges that are due
from time to time by reason of any variable interest rate (or other
similar provision) under any loan used by the Trustee to acquire
Leveraged Company Stock. The Trustee may rely on the Committee's
determination and directions with respect to the amount of the interest
charges, and the Trustee shall be released from any and all liability
attributable to its reliance thereon.
(j) Any loan entered into by the Plan to purchase
Company Stock shall be for a definite term, and shall not be payable
upon demand of any person, except where there has been a default. Any
such payment upon default shall be subject to the rules of Paragraph (d)
above.
10.2 COMPANY CONTRIBUTIONS FOR LEVERAGED TRANSACTIONS.
(a) Subject to Paragraph (b) below, in the event the
Plan engages in a Leveraged Company Stock acquisition pursuant to
Section 10.1 the Company shall contribute to the Trust Fund in cash as
part or all of the Company Contributions made pursuant to Section 4.2
such amounts, and at such times, as shall be necessary to provide the
Trust with funds (after taking into account any dividends payable with
respect to Leveraged Company Stock in the Suspense Account) sufficient
to pay any Current Obligations (including principal, interest and any
acquisition charges) incurred for the purpose of acquiring Leveraged
Company Stock to be held in the Trust Fund.
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(b) If a default under any Company-guaranteed loan
used to acquire Leveraged Company Stock results in the payment by the
Company (pursuant to its guarantee) of any amounts due under that loan,
then to the extent of these payments the Company shall be relieved of
its contribution obligation under this Section 10.2.
(c) Company Contributions (other than contributions of
Company Stock) specified by the Company for payment of Current
Obligations (as provided in Section 10.5) and Trust Fund earnings
thereon for the Plan Year, together with any cash dividends on Leveraged
Company Stock held in the Suspense Account, shall first be applied by
the Trustee towards the payment of Current Obligations incurred for the
purpose of acquiring Company Stock. Any excess of the total amount of
such contributions, earnings and cash dividends over the amount required
to pay any such Current Obligations shall then be allocated among the
Accounts of Participants in accordance with the provisions of Article
VI. For the purpose of determining the method of allocation of the
excess, the Current Obligations shall be deemed to have been paid first
with cash dividends and Trust Fund earnings, and, if any portion of the
Current Obligations shall remain unpaid after the application of all the
cash dividends and Trust Fund earnings, the balance due shall be deemed
paid with Company Contributions for the Plan Year. Any excess
contributions, dividends and/or earnings shall be allocated pursuant to
the provisions of Article VI.
10.3 VALUATION OF LEVERAGED COMPANY STOCK.
(a) In the case of Leveraged Company Stock, the
following special valuation rules shall apply:
(i) For purposes of valuing Leveraged Company
Stock in any transaction between the Plan and a "disqualified
person" as that term is defined in Code Section 4975(e)(2), the
value shall be determined in good faith and based on all relevant
factors as of the date of the transaction.
(ii) For purposes of a Participant's exercise of
his put option rights (if applicable) under Section 8.13,
Leveraged Company Stock shall be valued as of the most recent
Valuation Date as determined under the terms of this Plan.
(b) Notwithstanding the preceding provisions, in the
event the Leveraged Company Stock is not Freely Tradeable Stock, the
value shall be determined by one or more independent appraisers. In all
cases the valuation provisions of this Section 10.3, including the
selection
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of a Valuation Date for any purpose under this Plan, shall be
interpreted and applied in a manner consistent with the applicable
requirements under Code Sections 401(a)(28), 409 and 4975(e)(7), the
Treasury Regulations issued thereunder, that must be satisfied in order
to maintain the status of the Plan as a tax-qualified employee benefit
plan under Code Section 401(a) and to qualify for the prohibited
transaction exemption under Code Section 4975(d)(3).
10.4 SUSPENSE ACCOUNT.
At the time that any Leveraged Company Stock is acquired for the
Trust Fund, the Committee shall open and maintain a Suspense Account for the
purpose of holding unallocated Leveraged Company Stock until that Stock is
released and allocated in accordance with the provisions of Section 10.5.
10.5 RELEASE AND ALLOCATION OF LEVERAGED COMPANY STOCK.
All Leveraged Company Stock acquired for the Trust Fund shall be
held in the Suspense Account until released and allocated in accordance with the
provisions of this Section 10.5.
(a) Leveraged Company Stock acquired in connection
with a loan transaction shall be released from the Suspense Account and
allocated to the Company Stock Accounts of Participants according to the
rules as set forth below.
(i) For each Plan Year until the loan is fully
repaid, the number of shares of Leveraged Company Stock released
from the Suspense Account shall equal the number of unreleased
shares immediately before such release for that Plan Year
multiplied by the "Release Fraction" (as defined in Section
10.1(e)(ii)). If the Company Stock held in the Suspense Account
includes more than one class of securities, the number of
securities of each class to be released for such Plan Year shall
be determined by applying the Release Fraction to each of such
classes.
(ii) Notwithstanding the foregoing, in the event
the loan shall be repaid with the proceeds of a subsequent loan
("Substitute Loan"), the repayment shall not operate to release
all the Leveraged Company Stock but rather the release of that
stock shall be effected pursuant to the above provisions of this
Section 10.5 on the basis of
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payments of principal and interest on the Substitute Loan.
(iii) It is intended that the provisions of this
Section 10.5 shall be applied and construed in a manner
consistent with the requirements and provisions of Treasury
Regulation Section 54.4975-11(c).
(b) As of the Anniversary Date of each Plan Year, all
Leveraged Company Stock (if any) released from the Suspense Account for
the Plan Year shall be allocated among the Participants in the same
proportions as such Participants would have received allocations
(determined with respect to each Plan Year for which Company
Contributions were made) pursuant to the provisions of Section 6.5 if
the Company Contributions had not been specified and applied for the
payment of Current Obligations.
(c) If all the released Leveraged Company Stock is
released by reason of the application of cash dividends on Suspense
Account Stock, then the allocation shall be made on the same basis
(under Section 6.5) as if the cash dividends were Company Contributions.
(d) The Company shall specify, and advise the Trustee
with respect to:
(i) The amount (if any) of each Company
Contribution that is to be applied (together with the earnings
thereon) towards the payment of Current Obligations, and
(ii) The amount (if any) of cash dividends on
Leveraged Company Stock held in the Suspense Account that is to
be applied towards the payment of Current Obligations.
10.6 CERTAIN NONTERMINABLE PROVISIONS.
Except as is expressly provided and in Sections 8.14 with respect
to any distributed Leveraged Company Stock that is not Freely Tradeable Stock as
defined under Section 2.29, no such Leveraged Company Stock shall be subject to
a put, call, or other option, or buy-sell or similar arrangement while held by
and when distributed from the Plan, whether or not at such time the Plan
constitutes an employee stock ownership plan. The provisions of this Section
10.6 shall not terminate notwithstanding that the loan used to acquire such
Leveraged Company Stock shall be repaid or that the Plan ceases at any time to
constitute an employee stock ownership plan.
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ARTICLE XI
MERGER OF COMPANY; MERGER OF PLAN
11.1 EFFECT OF REORGANIZATION OR TRANSFER OF ASSETS.
In the event of a consolidation, merger, sale, liquidation, or
other transfer of the operating assets of the Company to any other company, the
ultimate successor or successors to the business of the Company shall
automatically be deemed to have elected to continue this Plan in full force and
effect in the same manner as if the Plan had been adopted by resolution of its
board of directors unless the successor(s), by resolution of its board of
directors, shall elect not to so continue this Plan in effect, in which case the
Plan shall automatically be deemed terminated as of the applicable effective
date set forth in the board resolution.
11.2 MERGER RESTRICTION.
Notwithstanding any other provision in this document, this Plan
shall not, in whole or in part, merge or consolidate with, or transfer its
assets or liabilities to any other plan unless each affected Participant in this
Plan would receive a benefit immediately after the merger, consolidation, or
transfer (if the Plan then terminated) that is equal to or greater than the
benefit he would have been entitled to receive immediately before the merger,
consolidation, or transfer (if the Plan had then terminated). Provided the
requirements set forth in the preceding sentence are satisfied, the Committee
may direct that the Plan may merge, consolidate with, or transfer its assets
and/or liabilities to another tax-qualified employee pension benefit plan. Any
such transaction shall be effected in accordance with any and all applicable
law.
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ARTICLE XII
PLAN TERMINATION AND
DISCONTINUANCE OF CONTRIBUTIONS
12.1 PLAN TERMINATION.
(a) Subject to the following provisions of this Section
12.1, the Company may terminate the Plan and the Trust Agreements at any
time by an instrument in writing executed in the name of the Company by
an officer or officers duly authorized to execute such an instrument,
and delivered to the Trustee(s).
(b) Upon and after the effective date of the termination,
the Company shall not make any further contributions under the Plan and
no contributions need be made by the Company applicable to the Plan Year
in which such termination occurs, except as otherwise required by law.
(c) The rights of all affected Participants to benefits
accrued to the date of termination of the Plan, to the extent funded as
of the date of termination, shall automatically become fully vested as
of that date. However, this vesting shall not preclude a reversion of
assets to the Company permitted under Section 4.6.
12.2 DISCONTINUANCE OF CONTRIBUTIONS.
(a) In the event the Company decides it is impossible or
inadvisable for business reasons to continue to make Company
Contributions under the Plan, the Company by resolution of its Board of
Directors may discontinue contributions to the Plan. Upon and after the
effective date of this discontinuance, the Company shall not make any
further Company Contributions under the Plan and no Company
Contributions need be made by the Company with respect to the Plan Year
in which the discontinuance occurs, except as otherwise required by law.
(b) The discontinuance of Company Contributions on the
part of the Company shall not terminate the Plan as to the funds and
assets then held by the Trustee(s), or operate to accelerate any
payments of distributions to or for the benefit of Participants or
Beneficiaries, and the Trustee(s) shall continue to administer the Trust
Fund in accordance with the provisions of the Plan until all of the
obligations under the Plan shall have been discharged and satisfied.
Notwithstanding the foregoing, if such discontinuance of Company
Contributions shall cause the Plan to lose its
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status as a qualified plan under Code Section 401(a), the Plan shall be
terminated in accordance with the provisions of this Article XII.
(c) On and after the effective date of a discontinuance of
Company Contributions, the rights of all affected Participants to
benefits accrued to that date, to the extent funded as of that date,
shall automatically become fully vested as of that date. However, this
vesting shall not preclude a reversion of assets to the Company
permitted under Section 4.6.
(d) The failure of the Company to contribute to the Trust
in any year when no contribution is required under Article IV shall not
be a suspension or discontinuance of the Plan.
12.3 RIGHTS OF PARTICIPANTS.
In the event of the termination of the Plan, for any cause
whatsoever, all assets of the Plan, after payment of expenses, shall be used for
the exclusive benefit of Participants and their Beneficiaries and no part
thereof shall be returned to the Company prior to satisfaction of all
liabilities with respect to the Participants and their Beneficiaries, except as
otherwise permitted by law.
12.4 TRUSTEE'S DUTIES ON TERMINATION.
(a) On or before the effective date of termination of this
Plan, the Trustee shall proceed as soon as possible, but in any event
within six months from such effective date, to reduce all of the assets
of the Trust Fund to cash and/or common stock and other securities in
such proportions as the Committee shall determine (after approval by the
Internal Revenue Service if necessary or desirable, with respect to any
portion of the assets of the Trust Fund held in common stock or
securities of the Company).
(b) After first deducting the estimated expenses for
liquidation and distribution chargeable to the Trust Fund, and after
setting aside a reasonable reserve for expenses and liabilities
(absolute or contingent) of the Trust, the Trustee shall make the
allocations required under Article VI, where applicable, with the same
effect as though the date of completion of liquidation were a Valuation
Date of the Plan.
(c) Following these allocations, the Trustee shall
promptly, after receipt of appropriate instructions from the Committee,
distribute in accordance with Article VIII to each former Participant a
benefit equal to the
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amount credited to his Account(s) as of the date of completion of the
liquidation.
(d) The Trustee and the Committee shall continue to
function as such for such period of time as may be necessary for the
winding up of this Plan and for the making of distributions in
accordance with the provisions of this Plan.
12.5 PARTIAL TERMINATION.
(a) In the event of a partial termination of the Plan
within the meaning of Code Section 411(d)(3), the interest of all
affected Participants in the Trust Fund to the extent funded as of the
date of the partial termination, shall become fully vested as of that
date. However, this vesting shall not preclude a reversion of Plan
assets to the Company permitted under Section 4.6.
(b) That portion of the assets of the Plan affected by the
partial termination shall be used exclusively for the benefit of the
affected Participants and their Beneficiaries, except as otherwise
permitted by law.
(c) With respect to Plan assets and Participants affected
by such a partial termination, the Committee and the Trustee shall
follow the same procedures and take the same actions prescribed in this
Article XII in the case of a total termination of the Plan.
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ARTICLE XIII
APPLICATION FOR BENEFITS
13.1 APPLICATION FOR BENEFITS.
The Committee may require any person claiming benefits under the
Plan to submit an application therefor, together with such other documents and
information as the Committee may require. In the case of any person suffering
from a disability which prevents such claimant from making personal application
for benefits, the Committee may, in its discretion, permit application to be
made by another person acting on his behalf. Notwithstanding the foregoing, if
the Committee shall have all information necessary to determine the amount and
form of benefit payments to a Participant or Beneficiary who is entitled to
benefit payments under this Plan, including but not limited to the name, age and
sex of all designated Beneficiaries and the proper mailing address of all
parties entitled to benefit payments, then the failure of a Participant or
Beneficiary to file an application for benefits shall not cause the Committee to
defer the commencement of benefit payments beyond the benefit commencement date
required under this Plan.
13.2 ACTION ON APPLICATION.
(a) Within 90 days following receipt of an application and
all necessary documents and information, the Committee's authorized
delegate reviewing such claim shall furnish the claimant with written
notice of the decision rendered with respect to such application. Should
special circumstances require an extension of time for processing the
claim, written notice of the extension shall be furnished to the
Claimant prior to the expiration of the initial 90-day period. The
notice shall indicate the special circumstances requiring an extension
of time and the date by which a final decision is expected to be
rendered. In no event shall the period of the extension exceed 90 days
from the end of the initial 90-day period.
(b) In the case of a denial of the claimant's application,
such written notice shall set forth specific reasons for the denial,
with specific reference to the Plan provisions upon which the denial is
based, a description of any additional information or material necessary
for perfection of the application (together with an explanation why such
material or information is necessary), and an explanation of the Plan's
claim review procedure.
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13.3 APPEALS.
A claimant who does not agree with the decision rendered with
respect to his application may appeal such decision to the Committee. Such
appeal must be made, in writing, within 65 days after the date of notice of the
decision with respect to the application, or if the application has neither been
approved nor denied within the applicable period provided in Section 13.2 above,
then the appeal must be made within 65 days after the expiration of the period.
Such claimant may request that his application be given full and fair review by
the one or more persons to whom such review responsibility has been delegated by
the Committee from time to time (the "appellate reviewers"). The claimant may
review all pertinent documents and submit issues and comments in writing in
connection with the appeal. The decision of the one or more appellate reviewers
shall be made promptly, and not later than 60 days after the Committee's receipt
of a request for review, unless special circumstances require an extension of
time for processing, in which case a decision shall be rendered as soon as
possible, but not later than l20 days after receipt of a request for review. The
decision on review shall be in writing and shall include specific reasons for
the decision, written in a manner calculated to be understood by the claimant
with specific reference to the pertinent Plan provisions upon which the decision
is based.
13.4 NO EFFECT ON TIMING OF DISTRIBUTIONS.
The provisions of this Article XIII that require the Committee or
its delegates to take action within specified time periods with respect to
applications for benefits and requests for review of decisions concerning
benefits under the Plan shall not be construed to require distributions of Plan
benefits to be made within such time periods. Distributions of benefits under
this Plan shall be governed by the provisions of Article VIII and applicable
federal laws and regulations.
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ARTICLE XIV
LIMITATIONS ON CONTRIBUTIONS
14.1 BASIC LIMITATION.
(a) Notwithstanding anything to the contrary contained
in this Plan, and subject to the adjustments required under this Article
XIV, the total "Annual Additions" under this Plan to a Participant's
Account(s) for any Limitation Year shall not exceed the lesser of:
(i) $30,000 (or such other maximum dollar amount
as may be permitted pursuant to regulations issued under Section
415(d) of the Code); or
(ii) 25% of the Participant's total compensation
for the Limitation Year.
(b) In determining a Participant's Compensation for
any Limitation Year, there shall be taken into account only the
Compensation that is actually paid to or includible in the gross income
of the Participant during such Limitation Year. In all cases this
Paragraph (b) shall be interpreted and applied in compliance with the
provisions of Treasury Regulations Section 1.415-2(d) or any successor
thereto.
(c) For purposes of applying the limitations of this
Article, a Limitation Year corresponding to the Plan Year has been
adopted. The specific dollar limitation referred to in Paragraph (a)
shall be adjusted annually for increases in the cost of living which are
authorized under Code Section 415, effective as of January 1 of the year
for which the adjustment is made, with such adjustment to apply to the
Limitation Year ending with or within the calendar year of adjustment.
(d) The provisions of this Section 14.1 shall be
applied and interpreted in a manner consistent with Code Section 415(c)
and the applicable Treasury Regulations issued thereunder, as amended
from time to time.
14.2 ANNUAL ADDITIONS.
(a) For purposes of this Article XIV, the term "Annual
Additions" shall mean, for any Limitation Year, the sum of the following
amounts:
(i) The amount credited to a Participant's
Accounts from Company Contributions for such Limitation Year
(including amounts deferred
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under a cash or deferred arrangement under Section 401(k) of the
Code);
(ii) The Participant's voluntary contributions for
such Limitation Year (if any are ever made under the Plan);
(iii) Forfeitures allocated to the Participant's
Account(s) for such Limitation Year;
(iv) Any amounts allocated in Limitation Years
ending after March 31, 1984, to an account established under a
funded welfare benefit plan or a defined benefit plan to provide
medical benefits with respect to the Participant after
retirement; and
(v) The Participant's pro rata share of Company
Contributions for such Limitation Year that are used to pay
Current Obligations and thus are not credited to Participants'
Accounts, with such pro rata share being calculated in accordance
with the provisions of Paragraph (c) below and Section 6.5 as if
such Company Contributions had been allocated among Participants'
Accounts.
(b) Notwithstanding the foregoing, in the event no
more than one-third of the Company Contributions which are deductible
under Code Section 404(a)(9) (relating to payments on a loan entered
into in connection with a Leveraged Company Stock acquisition described
in Article X) are allocated to Highly Compensated Employees (within the
meaning of Code Section 414(q)), then Annual Additions shall not include
the items specified in Subparagraphs (i) and (ii) immediately below:
(i) The Participant's pro rata share of Company
Contributions for the Limitation Year which are used to pay the
interest portion of Current Obligations arising under a loan
entered into in connection with a Leveraged Company Stock
acquisition described in Article X.
(ii) Forfeitures of Leveraged Company Stock
acquired with the proceeds of such a loan.
The provisions of this Paragraph shall be applied and interpreted in a
manner consistent with Code Section 415(c)(6) and the applicable
Treasury Regulations issued thereunder.
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(c) Pursuant to Treasury Regulation Section
54.4975-11(a)(8)(ii), a Participant's Annual Additions for any
Limitation Year shall not include Leveraged Company Stock that is
released from the Suspense Account and allocated to the Participant's
Company Stock Account in accordance with the provisions of Section 10.5.
L4.3 MEMBERSHIP IN OTHER DEFINED CONTRIBUTION PLANS.
If the Company or an Affiliated Company is or was making
contributions to any other defined contribution plan as defined in Section
414(i) of the Code (whether or not the plan has been terminated) on behalf of
any individuals who may be Participants in this Plan, then each such
Participant's Annual Additions in such other plan(s) shall be aggregated with
the Participant's Annual Additions under this Plan for purposes of applying the
limitations of Section 14.1.
L4.4 MEMBERSHIP IN DEFINED BENEFIT PLANS.
(a) The provisions of this Section 14.4 shall apply to
any Participant (herein a "Combined Plan Participant") in this Plan who
is or was also a participant in a defined benefit plan, as defined in
Section 4l4(j) of the Code (whether or not the plan has been
terminated), to which contributions are or were made by the Company or
an Affiliated Company. In addition to the limitation contained in
Section 14.1 of this Plan, for any Limitation Year the "Combined Plan
Fraction" for any Combined Plan Participant shall not exceed 1.0. As
used herein, the term "Combined Plan Fraction" means, with respect to
any Combined Plan Participant, a fraction equal to the sum of the
Defined Contribution Plan Fraction and the Defined Benefit Plan Fraction
for such Participant. In all cases the calculation of such Combined Plan
Fraction shall be made in accordance with the provisions of Code Section
415(e) and the following rules of this Section.
(b) "Defined Contribution Plan Fraction" means a
fraction determined in accordance with the provisions of Code Section
415(e) and the following rules with respect to the combined
participation by a Participant in all defined contribution plans of the
Company and all Affiliated Companies:
(i) The numerator of such fraction is the sum (as
determined as of the end of the applicable Limitation Year) of
all Annual Additions to the Participant's accounts under all such
plans.
(ii) The denominator of this fraction is the sum
of the lesser of the following amounts
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determined separately with respect to each Limitation Year and
each prior year of service:
(A) The product of 1.25 multiplied by the
dollar limitation under Code Section 415(c)(1)(A)
(determined without regard to Subsection (c)(6) thereof)
in effect for the applicable Limitation Year; or
(B) The product of 1.4 multiplied by an
amount equal to the percentage of compensation limitation
under Code Section 415(c)(1)(B) (or Subsection(c)(7)
thereof, if applicable) that applies with respect to the
Participant for the applicable Limitation Year.
(iii) Solely in the case of a defined contribution
plan in existence on July 1, 1982, at the election of the Plan
Administrator, in applying the above rules with respect to any
year ending after December 31, 1982, the denominator with respect
to each Participant for all years ending before January 1, 1983,
shall be an amount equal to the product of the denominator for
the year ending in 1982 (determined using the rules in effect
under Code Section 415(e)(3)(B) at that time) multiplied by the
"Transition Fraction." The "Transition Fraction" is a fraction
the numerator of which is the lesser of $51,875, or 1.4
multiplied by 25% of the compensation of the Participant for the
year ending in 1981, and the denominator of which is the lesser
of $41,500, or 25% of the compensation of the Participant for the
year ending in 1981.
(c) "Defined Benefit Plan Fraction" means a fraction
determined in accordance with the provisions of Code Section 415(e) and
the following rules with respect to the combined participation by a
Participant in all defined benefit plans of the Company and all
Affiliated Companies.
(i) The numerator of the fraction is the projected
annual benefit of the Participant under all such plans
(determined as of the close of the applicable Limitation Year).
For purposes of this Subparagraph (i), a Participant's projected
accrued benefit shall be determined in accordance with Treasury
Regulations Section 1.415-7(b)(3).
(ii) The denominator of this fraction is the
lesser of: (A) the product of 1.25 multiplied by the dollar
limitation under Code Section 415(b)(1)(A) for the applicable
Limitation Year; or
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(B) the product of 1.4 multiplied by the percentage of
compensation limitation under Code Section 415(b)(1)(B) with
respect to the Participant for the applicable Limitation Year.
(d) In the case of any Combined Plan Participant with
respect to whom the Combined Plan Fraction for any Limitation Year would
exceed l.0, the following corrective action shall be taken:
(i) First, the Committee or Plan Administrator
shall make such elections under Code Section 4l5 as may be
available (if any) which would allow the Plan to satisfy the
Combined Plan Fraction requirements of Code Section 4l5(e)
without causing any reduction in the benefits of participants
under this Plan or any defined benefit plan included in the
calculation of the Combined Plan Fraction (herein an "Included
Defined Benefit Plan").
(ii) Second, to the maximum extent permissible
under the applicable provisions of Code Sections 40l through 4l5,
the benefits payable with respect to such Combined Plan
Participant under the Included Defined Benefit Plans shall be
reduced or otherwise adjusted so as to allow the Combined Plan
Participant to satisfy the Combined Plan Fraction requirements of
Code Section 4l5(e) for the applicable Limitation Year.
(iii) After reducing or otherwise adjusting the
benefits under Included Defined Benefit Plans to the maximum
permissible extent as provided under subparagraph (ii) above, to
the extent necessary to achieve compliance with the Combined Plan
Fraction requirements of Code Section 4l5(e) the Committee shall
then implement adjustments to the Annual Additions otherwise
allocable for the applicable Limitation Year to such Combined
Plan Participant, with such adjustments to be made in accordance
with the provisions of Section l4.5 hereof, so as to eliminate
the remaining excess Annual Additions (if any) of such Combined
Plan Participant.
14.5 ADJUSTMENTS FOR EXCESS ANNUAL ADDITIONS.
In general, the amount of Company Contributions for any
Limitation Year under this Plan and any other defined contribution plan (as
defined in Code Section 414(i)) or defined benefit plan (as defined in Code
Section 414(j)) maintained by the Company or an Affiliated Company will be
determined so as to avoid Annual Additions in excess of the
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limitations set forth in Sections 14.1 through 14.4. However, if as a result of
the allocation of Forfeitures or administrative errors in calculating Company
Contributions or applying the provisions of this Article XIV, the Annual
Additions to a Participant's Accounts under this Plan (after giving effect to
the maximum permissible adjustments under the other plans described in Sections
14.3 and 14.4 hereof) would exceed the applicable limitations described in
Sections 14.1 through 14.4, the excess amount shall be subject to the following
rules:
(a) If the Participant had made any voluntary
contributions to the Plan or to any other defined contribution plan that
is maintained by the Company or an Affiliated Company which would be
aggregated with this Plan under Section 14.3 during the Limitation Year,
such contributions and the earnings thereon shall be returned to the
Participant to the extent of any excess Annual Additions.
(b) If excess Annual Additions remain after the
application of the rules of Paragraph (a) above, amounts which give rise
to the excess Annual Additions under this Plan shall be reallocated, to
the extent possible, to the Accounts of the Participants who do not have
excessive Annual Additions in accordance with the allocation formula
applicable to Company Contributions provided under Section 6.5.
(c) After each Participant's Accounts have been credited
with the sum equaling his maximum Annual Addition (determined under the
provisions of Sections 14.1 through 14.4), the residue of the excess
amount, if any, shall be transferred and credited to a Special Suspense
Account established for purposes of this Section 14.5.
(d) Any amounts held in the Special Suspense Account shall
be allocated to the Accounts of Participants as of the next succeeding
Anniversary Date in accordance with the allocation formula provided in
Section 6.5. The Special Suspense Account shall be exhausted before any
Company Contributions shall be allocated to the Accounts of Participants
subsequent to the date upon which the residue excess described in
Paragraph (c) is above credited to the Special Suspense Account.
(e) The Trustee shall segregate any amounts held in the
Special Suspense Account from other assets of the Plan and may place the
cash portions thereof in an interest-bearing account in any bank or
savings and loan institution, including the Trustee's own banking
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department (if applicable). Any amounts held in the Special Suspense
Account shall not participate in any allocation of forfeitures, or net
income or loss of other assets of the Trust Fund under Article VI.
(f) In the event the Plan shall terminate at a time
when all amounts in the Special Suspense Account have not been allocated
to the Accounts of the Participants, the Special Suspense Account
amounts shall be applied as follows:
(i) The amount in the Special Suspense Account
shall first be allocated, as of the Plan termination date, to
Participants on the same basis as specified in Paragraph (b)
above, with the allocation to be made to the maximum extent
permissible under the Annual Additions limitations of this
Article XIV, and
(ii) If after such allocations have been made, any
further residue funds remain in the Special Suspense Account, the
residue shall revert to the Company in accordance with the
applicable provisions of the Code, ERISA and the regulations
thereunder.
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ARTICLE XV
RESTRICTION ON ASSIGNMENT OR OTHER
ALIENATION OF PLAN BENEFITS
15.1 GENERAL RESTRICTIONS AGAINST ALIENATION.
The interest of any Participant or Beneficiary in the income,
benefits, payments, claims or rights hereunder, or in the Trust Fund shall not
in any event be subject to sale, assignment, hypothecation, or transfer. Each
Participant and Beneficiary is prohibited from anticipating, encumbering,
assigning, or in any manner alienating his or her interest under the Trust Fund,
and is without power to do so, except as may be permitted in connection with
providing for a loan from the Plan to the Participant pursuant to the provisions
of this Plan as it may be amended from time to time. The interest of any
Participant or Beneficiary shall not be liable or subject to his debts,
liabilities, or obligations, now contracted, or which may be subsequently
contracted. The interest of any Participant or Beneficiary shall be free from
all claims, liabilities, bankruptcy proceedings, or other legal process now or
hereafter incurred or arising; and the interest or any part thereof, shall not
be subject to any judgment rendered against the Participant or Beneficiary. In
the event any person attempts to take any action contrary to this Article XV,
such action shall be void and the Company, the Committee, the Trustees and all
Participants and their Beneficiaries, may disregard that action and are not in
any manner bound thereby, and they, and each of them separately, shall suffer no
liability for any such disregard thereof, and shall be reimbursed on demand out
of the Trust Fund for the amount of any loss, cost or expense incurred as a
result of disregarding or of acting in disregard of such action. The provisions
of this Section 15.1 shall be interpreted and applied by the Committee in
accordance with the requirements of Code Section 401(a)(13) as construed and
interpreted by authoritative judicial and administrative rulings and
regulations.
15.2 QUALIFIED DOMESTIC RELATIONS ORDERS.
The rules set forth in Section 15.1 above shall not apply with
respect to a "Qualified Domestic Relations Order" as described below.
(a) A "Qualified Domestic Relations Order" is a
judgment, decree, or order (including approval of a property settlement
agreement) that:
(i) Creates or recognizes the existence of an
Alternate Payee's right to, or assigns to an Alternate Payee the
right to, receive all or a
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portion of the benefits payable under this Plan with respect to a
Participant,
(ii) Relates to the provision of child support,
alimony payments, or marital property rights to a Spouse, child
or other dependent of a Participant,
(iii) Is made pursuant to a State domestic
relations law (including a community property law), and
(iv) Clearly specifies: (A) the name and last
known mailing address (if any) of the Participant and the name
and mailing address of each Alternate Payee covered by the order
(if the Plan Administrator does not have reason to know that
address independently of the order), (B) the amount or percentage
of the Participant's benefits to be paid to each Alternate Payee,
or the manner in which the amount or percentage is to be
determined, (C) the number of payments or period to which the
order applies, and (D) each plan to which the order applies.
For purposes of this Section 15.2, "Alternate Payee" means any Spouse,
former Spouse, child or other dependent of a Participant who is
recognized by a domestic relations order as having a right to receive
all, or a portion of, the benefits payable with respect to the
Participant.
(b) A domestic relations order is not a Qualified
Domestic Relations Order if it requires:
(i) The Plan to provide any type or form of
benefit, or any option, not otherwise provided under the Plan;
(ii) The Plan to provide increased benefits; or
(iii) The payment of benefits to an Alternate
Payee that are required to be paid to another Alternate Payee
under a previous Qualified Domestic Relations Order.
(c) A domestic relations order shall not be considered
to fail to satisfy the requirements of Paragraph (b)(i) above with
respect to any payment made before a Participant has separated from
service solely because the order requires that payment of benefits be
made to an Alternate Payee --
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(i) On or after the date on which the Participant
attains (or would have first attained) Earliest Retirement Age,
as defined in Code Section 417(f)(3);
(ii) As if the Participant had retired on the date
on which such payment is to begin under the order (but taking
into account only the present value of accrued benefits and not
taking into account the present value of any subsidy for early
retirement benefits); and
(iii) In any form in which the benefits may be paid
under the Plan to the Participant (other than in the form of a
joint and survivor annuity with respect to the Alternate Payee
and his or her subsequent spouse).
Notwithstanding the foregoing, if the Participant dies before his
Earliest Retirement Age, the Alternate Payee is entitled to benefits
only if the Qualified Domestic Relations Order requires survivor
benefits to be paid to the Alternate Payee.
(d) In the case of any domestic relations order
received by the Plan, the Plan Administrator shall promptly notify the
Participant and any Alternate Payee of the receipt of the order and the
Plan's procedures for determining the qualified status of domestic
relations orders. Within a reasonable period after the receipt of the
order, the Plan Administrator shall determine whether the order is a
Qualified Domestic Relations Order and shall notify the Participant and
each Alternate Payee of the determination.
(e) The Plan Administrator shall establish reasonable
procedures to determine the qualified status of domestic relations
orders and to administer distributions under Qualified Domestic
Relations Orders. During any period in which the issue of whether a
domestic relations order is a Qualified Domestic Relations Order is
being determined (by the Plan Administrator, by a court of competent
jurisdiction, or otherwise), the Plan Administrator shall segregate in a
separate account in the Plan (or in an escrow account) the amounts which
would have been payable to the Alternate Payee during the period if the
order had been determined to be a Qualified Domestic Relations Order. If
within 18 months the order (or modification thereof) is determined to be
a Qualified Domestic Relations Order, the Plan Administrator shall pay
the segregated amounts (plus any interest thereon) to the person or
persons entitled thereto. However, if within 18 months (i) it is
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determined that the order is not a Qualified Domestic Relations Order,
or (ii) the issue as to whether the order is a Qualified Domestic
Relations Order is not resolved, then the Plan Administrator shall pay
the segregated amounts (plus any interest thereon) to the person or
persons who would have been entitled to the amounts if there had been no
order, or restore the amount to the Participant's Account. Any
determination that an order is a Qualified Domestic Relations Order that
is made after the close of the 18-month period shall be applied
prospectively only.
15.3 NO LOANS TO PARTICIPANTS.
Participants may not borrow funds from the Plan.
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ARTICLE XVI
TOP-HEAVY PLAN RULES
16.1 APPLICABILITY.
Notwithstanding any provision in this Plan to the contrary, and
subject to the limitations set forth in Section 16.8, the requirements of
Sections 16.4, 16.5, 16.6 and 16.7 shall apply under this Plan in the case of
any Plan Year in which the Plan is determined to be a Top-Heavy Plan under the
rules of Section 16.3. Except as is expressly provided to the contrary herein,
the rules of this Article XVI shall be applied after the application of the
Affiliated Company rules of Section 2.4.
16.2 DEFINITIONS.
For purposes of this Article XVI, the following special
definitions and definitional rules shall apply:
(a) The term "Key Employee" means any Employee or
former Employee who, at any time during the Plan Year or any of the four
preceding Plan Years, is or was --
(i) An officer of the Company having an annual
compensation greater than 50% of the amount in effect under Code
Section 415(b)(1)(A) for the Plan Year; provided, however, for
such purposes no more than 50 Employees (or, if lesser, the
greater of three or 10% of the Employees) shall be treated as
officers;
(ii) One of the 10 Employees having annual
compensation from the Company of more than the limitation in
effect under Code Section 415(c)(1)(A) and owning (or considered
as owning within the meaning of Code Section 318) the largest
interests in the Company. For this purpose, if two Employees have
the same interest in the Company, the Employee having greater
annual compensation from the Company shall be treated as having a
larger interest;
(iii) A Five Percent Owner of the Company; or
(iv) A One Percent Owner of the Company having an
annual compensation from the Company of more than $150,000.
(b) The term "Five Percent Owner" means any person who
owns (or is considered as owning within the
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meaning of Code Section 318) more than 5% of the outstanding stock of
the Company or stock possessing more than 5% of the total combined
voting power of all stock of the Company.
(c) The term "One Percent Owner" means any person who
would be described in Paragraph (b) if "1%" were substituted for "5%"
each place where it appears therein.
(d) The term "Non-Key Employee" means any Employee who is
not a Key Employee.
(e) The term "Determination Date" means, with respect to
any Plan Year, the last day of the preceding Plan Year. In the case of
the first plan year of any plan, the term "Determination Date" shall
mean the last day of that plan year.
(f) The term "Aggregation Group" means (i) each plan of
the Company in which a Key Employee is a Participant, and (ii) each
other plan of the Company which enables any plan described in clause (i)
to meet the requirements of Code Sections 401(a)(4) or 410. Any plan not
required to be included in an Aggregation Group under the preceding
rules may be treated as being part of such group if the group would
continue to meet the requirements of Code Sections 401(a)(4) and 410
with the plan being taken into account.
(g) For purposes of determining ownership under Paragraphs
(a), (b) and (c) above, the following special rules shall apply: (i)
Code Section 318(a)(2)(C) shall be applied by substituting "5%" for
"50%", and (ii) the aggregation rules of Subsections (b), (c) and (m) of
Code Section 414 shall not apply, with the result that the ownership
tests of this Section 16.2 shall apply separately with respect to each
Affiliated Company.
(h) The terms "Key Employee" and "Non-Key Employee" shall
include their Beneficiaries, and the definitions provided under this
Section 16.2 shall be interpreted and applied in a manner consistent
with the provisions of Code Section 416(i) and the regulations
thereunder.
(i) For purposes of this Article XVI, an Employee's
compensation shall be determined pursuant to the definition set forth in
Section 14.1(b) of this Plan.
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16.3 TOP-HEAVY STATUS
(a) The term "Top-Heavy Plan" means, with respect to
any Plan Year --
(i) Any defined benefit plan if, as of the
Determination Date, the present value of the cumulative accrued
benefits under the plan for Key Employees exceeds 60% of the
present value of the cumulative accrued benefits under the plan
for all Employees, and
(ii) Any defined contribution plan if, as of the
Determination Date, the aggregate of the account balances of Key
Employees under the plan exceeds 60% of the present value of the
aggregate of the account balances of all Employees under the
plan.
In applying the foregoing provisions of this Paragraph (a), the
valuation date to be used in valuing Plan assets shall be (A) in the
case of a defined benefit plan, the same date which is used for
computing costs for minimum funding purposes, and (B) in the case of a
defined contribution plan, the most recent valuation date within the
12-month period ending on the applicable Determination Date.
(b) Each plan maintained by the Company required to be
included in an Aggregation Group shall be treated as a Top-Heavy Plan if
the Aggregation Group is a Top-Heavy Group.
(c) The term "Top-Heavy Group" means any Aggregation
Group if the sum (as of the Determination Date) of (i) the present value
of the cumulative accrued benefits for Key Employees under all defined
benefit plans included in the group, and (ii) the aggregate of the
account balances of Key Employees under all defined contribution plans
included in the group exceeds 60% of a similar sum determined for all
Employees. For purposes of determining the present value of the
cumulative accrued benefit of any Employee, or the amount of the account
balance of any Employee, such present value or amount shall be increased
by the aggregate distributions made with respect to the Employee under
the plan during the five year period ending on the Determination Date.
The preceding prior distribution rule shall also apply to distributions
under a terminated plan that, if it had not been terminated, would have
been required to be included in an Aggregation Group; provided, however,
any rollover contribution or similar transfer initiated by the Employee
and made after December 31, 1983 to a plan shall
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not be taken into account with respect to the transferee plan for
purposes of determining whether such plan is a Top-Heavy Plan (or
whether any Aggregation Group which includes such plan is a Top-Heavy
Group).
(d) If any individual is a Non-Key Employee with
respect to any plan for any plan year, but the individual was a Key
Employee with respect to the plan for any prior plan year, any accrued
benefit for the individual (and the account balance of the individual)
shall not be taken into account for purposes of this Section 16.3.
(e) If any individual has not performed any services
for the Company at any time during the five year period ending on the
Determination Date, any accrued benefit for such individual (and the
account balance of the individual) shall not be taken into account for
purposes of this Section 16.3
(f) For all purposes of this Article XVI, the
definition provided under this Section 16.3 shall be applied and
interpreted in a manner consistent with the provisions of Code Section
416(g) and the Regulations thereunder.
16.4 MINIMUM CONTRIBUTIONS.
For each Plan Year in which the Plan is determined to be a
Top-Heavy Plan, the minimum Company Contributions for that year shall be
determined in accordance with the rules of this Section 16.4.
(a) Except as provided below, the minimum contribution
(excluding amounts deferred under a cash or deferred arrangement under
Section 401(k) of the Code) for each Non-Key Employee who has commenced
participation in this Plan and is actively employed by the Company (or
on an approved Leave of Absence) as of the end of the Plan Year shall be
not less than 3% of his compensation. Any minimum contribution required
to be made pursuant to this Section shall be determined without regard
to whether or not the Non-Key Employee has completed one thousand
(1,000) or more Hours of Service during the Plan Year.
(b) Subject to the following rules of this Paragraph
(b), the percentage set forth in Paragraph (a) above shall not be
required to exceed the percentage at which contributions (including
amounts deferred under a cash or deferred arrangement under Section
401(k) of the Code) are made (or are required to be made) under the Plan
for the year for the Key Employee for whom the
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percentage is the highest for the year. This determination shall be made
by dividing the contributions for each Key Employee by so much of his
total compensation for the year as does not exceed the limit in effect
under Section 401(a)(17) of the Code. For purposes of this Paragraph
(b), all defined contribution plans required to be included in an
Aggregation Group shall be treated as one plan. Notwithstanding the
foregoing, the exceptions to Paragraph (a) as provided under this
Paragraph (b) shall not apply to any plan required to be included in an
Aggregation Group if the plan enables a defined benefit plan to meet the
requirements of Code Sections 401(a)(4) or 410.
(c) The requirements of this Section 16.4 must be
satisfied without taking into account contributions under chapter 2 or
21 of the Code, title II of the Social Security Act, or any other
Federal or State law.
(d) In the event a Participant is covered by both a
defined contribution and a defined benefit plan maintained by the
Company, both of which are determined to be Top Heavy Plans, the defined
benefit minimum, offset by the benefits provided under the defined
contribution plan, shall be provided under the defined benefit plan.
16.5 COMPENSATION LIMITATION.
For any Plan Year in which the Plan is determined to be a
Top-Heavy Plan, the Plan shall not take into account an Employee's compensation,
as defined in Section 14.1(b) in excess of the limit in effect under Code
Section 401(a)(17).
16.6 MAXIMUM ANNUAL ADDITION.
(a) Except as set forth below, for any Plan Year in which
the Plan is determined to be a Top-Heavy Plan, the rules of Section
14.4(b)(ii) and (c)(ii) shall be applied by substituting "1.0" for
"1.25".
(b) The rule set forth in Paragraph (a) above shall not
apply if (i) the minimum contribution requirement of Section 16.4(a)
above would be satisfied after substituting "4%" for "3%" where it
appears therein, and (ii) the Plan would not be a Top-Heavy Plan if
"90%" were substituted for "60%" each place it appears in Section
16.3(a)(ii).
(c) The rules of Paragraph (a) shall not apply with
respect to any Employee as long as there are no (i) Company
Contributions (including amounts deferred under a cash or deferred
arrangement under Section 401(k)
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of the Code), forfeitures, or voluntary nondeductible contributions
allocated to the Employee under a defined contribution plan maintained
by the Company, or (ii) accruals by the Employee under a defined benefit
plan maintained by the Company.
(d) In the case where the Plan is subject to the rules of
Paragraph (a) above, the rules of Section 14.4(b)(iii) shall be applied
by substituting $41,500" for "$51,875."
16.7 MINIMUM VESTING RULES.
(a) For any Plan Year in which it is determined that the
Plan is a Top-Heavy Plan, the vesting schedule of the Plan shall be
changed to that set forth below (unless the Plan's vesting schedule
otherwise provides for vesting at a rate at least as rapid as that set
forth below).
Years of Service Nonforfeitable Percentage
---------------- -------------------------
2 20%
3 40%
4 60%
5 80%
6 or more 100%
(b) If the Plan ceases to be a Top-Heavy Plan, the vesting
schedule of the Plan shall (for such Plan Years as the Plan is not a
Top-Heavy Plan) revert to that provided in Section 7.2 (the "Regular
Vesting Schedule"). If such reversion to the Regular Vesting Schedule is
deemed to constitute a vesting schedule change that is attributable to a
Plan amendment (within the meaning of Code Section 411(a)(10)), then
such reversion to said Regular Vesting Schedule shall be subject to the
requirements of Section 7.4 of this Plan. For such purposes, the date of
the adoption of such deemed amendment shall be the Determination Date as
of which it is determined that the Plan has ceased to be a Top-Heavy
Plan.
16.8 NON-ELIGIBLE EMPLOYEES.
The rules of this Article XVI shall not apply to any Employee
included in a unit of employees covered by a collective bargaining agreement
between employee representatives and one or more employers if retirement
benefits were the subject of good faith bargaining between such employee
representatives and the employer or employers.
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ARTICLE XVII
PLAN AMENDMENTS
17.1 AMENDMENTS.
The Board of Directors may at any time, and from time to time,
amend the Plan, and any Trust Agreement thereunder, by an instrument in writing
executed in the name of the Company by an officer or officers duly authorized to
execute such instrument. However, no amendment shall be made at any time the
effect of which would be:
(a) To cause any assets of the Trust Fund, at any time
prior to the satisfaction of all liabilities with respect to
Participants and their Beneficiaries, to be used for or diverted to
purposes other than providing benefits to the Participants and their
Beneficiaries, and defraying reasonable expenses of administrating the
Plan, except as permitted under Article IV or otherwise as permitted by
applicable law;
(b) To have retroactive effect so as to decrease the
accrued benefit of any Participant (within the meaning of Code Section
411(d)(6)) with respect to service performed prior to the effective date
of the amendment; or,
(c) To increase the responsibilities or liabilities of a
Trustee and/or Investment Manager without his written consent.
17.2 RETROACTIVE AMENDMENTS.
Notwithstanding any provisions of this Article XVII to the
contrary, to the extent allowable under applicable law the Plan may be amended
prospectively or retroactively (as provided in Section 401(b) of the Code) to
make the Plan conformed to any provision of ERISA, the Code provisions dealing
with employee plans, or any regulation under either.
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ARTICLE XVIII
MISCELLANEOUS
18.1 NO ENLARGEMENT OF EMPLOYEE RIGHTS.
(a) This Plan is strictly a voluntary undertaking on the
part of the Company and shall not be deemed to constitute a contract
between the Company and any Employee, or to be consideration for, or an
inducement to, or a condition of, the employment of any Employee.
(b) Nothing contained in the Plan shall be deemed to give
any Employee the right to be retained in the employ of the Company or to
interfere with the right of the Company to discharge or retire any
Employee at any time.
(c) No Employee, prior to his acquiring vested rights in
benefits as provided in this Plan, shall have any right to or interest
in any portion of any fund, other than as herein specifically provided.
18.2 MAILING OF PAYMENTS; LAPSED BENEFITS.
(a) All payments under the Plan shall be delivered in
person or mailed to the last address of the Participant (or, in the case
of the death of the Participant, to the last address of any other person
entitled to such payments under the terms of the Plan) furnished
pursuant to Section 18.3 below.
(b) (i) In the event that a benefit is payable under this
Plan to a Participant and after reasonable efforts the
Participant cannot be located for the purpose of paying the
benefit during a period of three consecutive years, the
Participant shall be presumed dead and the benefit shall, upon
the termination of that three year period, be paid to the
Participant's Beneficiary.
(ii) If any eligible Beneficiary cannot be located
for the purpose of paying the benefit for the following two
years, then the benefit shall be forfeited and treated in the
manner prescribed by the rules of Section 6.8.
(iii) If a Participant shall die prior to receiving
a distribution of his entire benefit under this Plan (other than
a Participant presumed to have died as provided above), if after
reasonable efforts an eligible Beneficiary of the Participant
cannot be
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located for the purpose of paying the benefit during a period of
five consecutive years, the benefit shall, upon expiration of
such five-year period, be forfeited and treated in the manner
prescribed by the rules of Section 6.8.
(c) For purposes of this Section, the term "Beneficiary"
shall include any person entitled under Section 8.4 to receive the
interest of a deceased Participant or deceased designated Beneficiary.
It is the intention of this provision that during the relevant waiting
period (two years or five years) the benefit will be distributed to an
eligible Beneficiary in a lower priority category under Section 8.5 if
no eligible Beneficiary in a higher priority category can be located by
the Committee after reasonable efforts have been made.
(d) Notwithstanding the preceding rules, if after such a
forfeiture the Participant or an eligible Beneficiary shall claim the
forfeited benefit, the forfeited benefit shall be reinstated and paid to
the claimant as soon as practical following the claimant's production of
reasonable proof of his or her identity and entitlement to the benefit
(determined pursuant to the Plan's normal claim review procedures). The
amount of the benefit payable to such claimant shall take into
consideration the actuarial adjustments required, if any, to reflect the
fact that no benefit payments were made during the time the Participant
and/or the Beneficiary could not be located.
(e) The Committee shall direct the Trustee with respect to
the procedures to be followed concerning a missing Participant (or
Beneficiary), and the Company shall be obligated to contribute to the
Trust Fund any amounts necessary to pay any reinstated benefit after it
has been forfeited pursuant to the provisions of this Section.
18.3 ADDRESSES.
Each Participant shall be responsible for furnishing the
Committee with his correct current address and the correct current name and
address of his Beneficiary.
18.4 NOTICES AND COMMUNICATIONS.
(a) All applications, notices, designations, elections,
and other communications from Participants shall be in writing, on forms
prescribed by the Committee and shall be mailed or delivered to the
office designated by the Committee, and shall be deemed to have been
given when received by such office.
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(b) Each notice, report, remittance, statement and
other communication directed to a Participant or Beneficiary shall be in
writing and may be delivered in person or by mail. An item shall be
deemed to have been delivered and received by the Participant or
Beneficiary five business days after it is deposited in the United
States Mail with postage prepaid, addressed to the Participant or
Beneficiary at his last address of record with the Committee.
18.5 REPORTING AND DISCLOSURE.
The Plan Administrator shall be responsible for the reporting and
disclosure of information required to be reported or disclosed by the Plan
Administrator pursuant to ERISA or any other applicable law.
18.6 GOVERNING LAW.
All legal questions pertaining to the Plan shall be determined in
accordance with the provisions of ERISA, the Code, and the laws of the State of
California.
18.7 RESERVED FOR PLAN MODIFICATIONS.
18.8 INTERPRETATION.
(a) Article and Section headings are for convenient
reference only and shall not be deemed to be part of the substance of
this instrument or in any way to enlarge or limit the contents of any
Article or Section.
(b) Unless the context clearly indicates otherwise,
masculine gender shall include the feminine, the singular shall include
the plural, and the plural shall include the singular.
(c) The provisions of this Plan shall in all cases be
interpreted in a manner that is consistent with this Plan satisfying:
(i) The requirements (of Code Section 401(a) and
related statutes) for qualification as a tax-qualified employee
stock ownership plan; and
(ii) The requirements (of Code Section 4975(e)(7)
and related statutes) for qualification as an ESOP and
eligibility for the prohibited transaction exemption provided
under Code Section 4975(d)(3) and the related statutes.
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18.9 WITHHOLDING FOR TAXES.
Any payments out of the Trust Fund may be subject to withholding
for taxes as may be required by any applicable federal or state law.
18.10 COUNTERPARTS.
This Plan document may be executed in any number of identical
counterparts, each of which shall be deemed a complete original in itself and
may be introduced in evidence or used for any other purpose without the
production of any other counterparts.
18.11 SUCCESSORS AND ASSIGNS.
This Plan and the Trust established hereunder shall inure to the
benefit of, and be binding upon, the parties hereto and their successors and
assigns.
IN WITNESS WHEREOF, Retail Merchandising Service Automation, Inc.
has caused this instrument to be executed by its duly authorized officer as of
the ___ day of __________, 1995, effective, however, as otherwise expressly
provided herein.
RETAIL MERCHANDISING SERVICE
AUTOMATION, INC.,
a Delaware corporation
By: /s/ DAN PAUL
---------------------------------
Dan D. Paul
President
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