As filed with the Securities and Exchange Commission on August 30, 2001
Registration No. 333-67466
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
POST EFFECTIVE AMENDMENT
TO
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
WILLIS NORTH AMERICA INC.
(Exact name of Registrant as specified in its charter)
Delaware 135654526
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
P.O. Box 305026
Nashville, TN 37230-5026
(615) 872-3000
(Address, including zip code, of Registrant's principal executive office)
Willis North America Inc. Financial Security Partnership Plan
(Full title of the Plan)
Mary E. Caiazzo
Willis North America Inc.
P.O. Box 305026
Nashville, TN 37230-5026
(615) 872-3006
(Name, address, including zip code, and telephone number, including area
code, of Registrant's agent for service)
Copies to:
Stephen W. Fackler
Simpson Thacher & Bartlett
3330 Hillview Avenue
Palo Alto, CA 94304
(650) 251-5000
CALCULATION OF REGISTRATION FEE
==============================================================================
Proposed Proposed
Maximum Maximum Amount of
Title of Securities Amount to be Offering Price Aggregate Registration
to be Registered Registered Per Share Offering Price Fee
- ---------------- ---------- --------- -------------- ---
Interests in the Indeterminate
Plan............. (1) N/A N/A N/A
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(1) Pursuant to Rule 416(c) under the Securities Act of 1933, this
registration statement covers an indeterminate amount of interests to be
offered or sold pursuant to the employee benefit plan described herein.
PART II
EXPLANATORY NOTE
This Post-Effective Amendment to Form S-8 is submitted solely to update the
Willis North America Inc. Financial Security Partnership Plan filed as Exhibit
4.3 to the Form S-8 filed August 14, 2001.
Item 8. Exhibits.
4.1 Certificate of Incorporation of the Registrant*
4.2 Bye-Laws of the Registrant*
4.3 Amended and Restated Willis North America Inc. Financial Security
Partnership Plan (filed herewith)
23.1 Consent of Deloitte & Touche*
24.1 Power of Attorney*
* Previously filed or incorporated by reference on the Registration
Statement on Form S-8 as filed by the Registrant with the Securities and
Exchange Commission on August 14, 2001.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing this Post-Effective Amendment and has duly
caused this Post-Effective Amendment to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Nashville, Tennessee on
the 30th day of August, 2001.
WILLIS NORTH AMERICA INC.
By: /s/ Charles D. Hamilton
---------------------------------------------
Name: Charles D. Hamilton
Title: Chief Financial Officer
Signature Title Date
--------- ----- ----
* Executive Chairman August 30, 2001
- ---------------------------- (principal executive officer)
Joseph J. Plumeri
*
- ---------------------------- Chief Financial Officer and August 30, 2001
Charles D. Hamilton Director
(principal accounting officer)
* Chief Executive Officer and August 30, 2001
- ---------------------------- Director
Brian D. Johnson
* Director August 30, 2001
- ----------------------------
Mary E. Caiazzo
*By: /s/ Charles D. Hamilton Attorney in Fact August 30, 2001
- ---------------
Charles D. Hamilton
The Plan. Pursuant to the requirements of the Securities Act of 1933, as
amended, the administrators of the Willis North America Inc. Financial
Security Partnership Plan have duly caused this Post Effective Amendment to be
signed on its behalf by the undersigned, thereunto duly authorized as of the
30th day of August, 2001.
WILLIS NORTH AMERICA INC. FINANCIAL SECURITY PARTNERSHIP PLAN
/s/ Charles D. Hamilton
- --------------------------------------------
Charles D. Hamilton, Plan Representative
INDEX TO EXHIBITS
Exhibit
Number Description
4.1 Certificate of Incorporation of the Registrant*
4.2 By-laws of the Registrant*
4.3 Amended and Restated Willis North America Inc. Financial
Security Partnership Plan (filed herewith)
23.1 Consent of Deloitte & Touche*
24 Power of Attorney*
* Previously filed or incorporated by reference on the Registration
Statement on Form S-8 as filed by the Registrant with the Securities and
Exchange Commission on August 14, 2001.
Exhibit 4.3
WILLIS NORTH AMERICA INC.
FINANCIAL SECURITY PARTNERSHIP PLAN
As Amended and Restated Effective September 1, 2001
Table of Contents
Page
----
Introduction 1
Article I Definitions 2
Article II Eligibility to Participate 16
Article III Contributions 18
Article IV Participant Accounts and Investment Funds 35
Article V Vesting and Forfeitures 39
Article VI Distributions 43
Article VII In-Service Withdrawals 49
Article VIII Plan Administration 54
Article IX Amendment and Termination 59
Article X General Provisions 62
Article XI Top Heavy Provisions 65
Article XII Adoption of the Plan by Other Entities 69
Article XIII The Trustee 70
INTRODUCTION
Establishment of the Plan
The Willis North America Inc. Financial Security Partnership Plan was first
established effective January 1, 1986 as the Corroon & Black Financial
Security Partnership Plan by Corroon & Black Corporation for the benefit of
its eligible employees. Prior to 1986, this Plan was known as "The Corroon &
Black Corporation Thrift Plan," the "Corroon & Black Employees' Savings and
Stock Investment Plan," and the "Corroon & Black of Tennessee, Inc. Employee
Incentive Thrift Plan." It was amended and restated to be generally effective
January 1, 1989, except that the provisions of Article III, unless otherwise
specified, were generally effective January 1, 1987. Effective November 1,
1990, the name of the Plan was changed to the Willis Corroon Corporation
Financial Security Partnership Plan. Willis Corroon Corporation is the
successor by merger to Corroon & Black Corporation. The Plan was further
amended and restated effective October 1, 1997, September 18, 1998, and
October 1, 1999. Effective October 1, 1999, the name of the Plan was changed
to the Willis North America Inc. Financial Security Partnership Plan as the
result of Willis Corroon Corporation's name change to Willis North America
Inc. The Plan has now been amended and restated to be generally effective
September 1, 2001, except as otherwise provided herein.
The rights and benefits of Participants shall be determined as provided
herein, except as specifically provided or changed by subsequent amendment.
The document in effect prior to this amendment and restatement shall govern
the rights and benefits of Participants who separated from service prior to
the effective date.
The Plan has been amended and restated to comply with the Tax Reform Act of
1986 and certain other laws and regulations including, without limitation, the
Unemployment Compensation Amendments of 1992, the Omnibus Budget
Reconciliation Act of 1993, the Retirement Protection Act of 1994, the Small
Business Jobs Protection Act of 1996, the Taxpayer Relief Act of 1997, and the
Internal Revenue Service Restructuring and the Reform Act of 1998 which have
become effective since the Plan was last amended. It is intended that the
Plan, together with the Trust Agreement, meet all the requirements of ERISA as
amended and qualify under Sections 401(a) and 501(a) of the Code. The Plan
shall be interpreted, wherever possible, to comply with the terms of the Code,
ERISA and all regulations and rulings issued thereunder.
1
ARTICLE I
Definitions
As used herein, the following words and phrases have the meanings ascribed to
them in Article I unless a different meaning is plainly required by the
context. Some of the words and phrases used in the Plan are not defined in
this Article I, but, for convenience, are defined as they are introduced into
the text. Words in the masculine gender shall be deemed to include the
feminine gender and words in the feminine gender shall be deemed to include
the masculine gender. Nouns and pronouns when stated in the singular shall
include the plural and when stated in the plural shall include the singular
whenever appropriate. Any headings used herein are included for ease of
reference only, and are not to be construed so as to alter any of the terms of
the Plan.
1.01 Accrued Benefit or Benefit means the sum of the balances in the
Participant's Before-Tax Deposit Account, Stock-Based Company Matching
Deposit Account, Unrestricted Company Matching Deposit Account (prior to
September 1, 2001, the Company Matching Deposit Account), Company Basic
Deposit Account, After-Tax Deposit Account, Deductible Contribution
Account, Rollover Account, Predecessor Plan Company Matching Deposit
Account and Prior Plan Account.
1.02 Actual Contribution Percentage means, with respect to a specified group
of Employees, the average of the Actual Contribution Ratios calculated
separately for each Employee in that group. The Actual Contribution
Percentage for each group shall be calculated to the nearest one
one-hundredth of one percent.
1.03 Actual Contribution Ratio means for any Employee, the ratio of (a) the
sum of the Employee's Company Matching Deposits for that Plan Year
(excluding any Company Matching Deposits forfeited under the provisions
of Sections 3.05 and 3.06), to (b) his or her Discrimination
Compensation for that entire Plan Year; provided that, upon the
direction of the Plan Administrator, Discrimination Compensation for a
Plan Year shall only be counted if received during the period an
Employee is, or is eligible to become, a Participant. The ratio
determined for each Employee in the group shall be calculated to the
nearest one one-hundredth of one percent. A Company Matching Deposit
will be taken into account for a Plan Year only if it is: (i) made on
account of a Before-Tax Deposit for the Plan Year; (ii) allocated to the
Participant's account as of a date within that Plan Year; and (iii) paid
to the Fund by the end of the twelfth month following the close of that
Plan Year. Qualified Matching Contributions that are used to meet the
requirements of Code Section 401(k)(3)(A) are not to be taken into
account in determining the Actual Contribution Ratio.
1.04 Actual Deferral Percentage means, with respect to a specified group of
Employees, the average of the Actual Deferral Ratios calculated
separately for each Employee in that group. The Actual Deferral
Percentage for each group shall be calculated to the nearest one
one-hundredth of one percent.
2
1.05 Actual Deferral Ratio means, for any Employee, the ratio of (a) the
amount of Before-Tax Deposits made pursuant to Section 3.01(a) for a
Plan Year (including Before-Tax Deposits returned to a Highly
Compensated Employee under Section 3.05), to (b) the Employee's
Discrimination Compensation for that entire Plan Year, provided that,
upon the direction of the Plan Administrator, Discrimination
Compensation for a Plan Year shall only be counted if received during
the period an Employee is, or is eligible to become, a Participant. The
ratio determined for each Employee in the group shall be calculated to
the nearest one one-hundredth of one percent. For purposes of
determining the Actual Deferral Ratio for an Employee for a Plan Year,
Before-Tax Deposits may be taken into account for a Plan Year only if
they:
(a) Relate to compensation that either would have been received by the
Employee in the Plan Year but for the deferral election, or are
attributable to services performed by the Employee in the Plan
Year and would have been received by the Employee within 2 1/2
months after the close of the Plan Year but for the deferral
election,
(b) Are allocated to the Employee as of a date within that Plan Year
and the allocation is not contingent on the participation or
performance of service after such date, and
(c) Are actually paid to the Trustees no later than 12 months after
the end of the Plan Year to which the contributions relate.
1.06 Affiliated Group means the Company and all other entities required to be
aggregated with the Company under Sections 414(b), (c), (m) or (o) of
the Code.
1.07 Beneficiary means a person or entity designated as such by a Participant
to receive benefits payable upon the Participant's death, as a result of
the Participant's participation in the Plan. Notwithstanding the
preceding sentence, the Beneficiary shall be the Participant's spouse at
the time of death, unless one of the following conditions is satisfied:
(a) The Participant has no spouse at the time of death, or
(b) The Participant's spouse consents in writing to the Participant's
designation of an alternate Beneficiary in the manner prescribed
by Section 6.02(c), or
(c) The Participant's spouse cannot be located.
If the Participant has no spouse at the time of death, or if no other
person designated as Beneficiary survives the Participant, the
Beneficiary shall be the Participant's estate.
1.08 Benefits Committee means the person or persons designated by the Board
to oversee operation and administration of the Plan pursuant to Article
VIII.
3
1.09 Board means the Board of Directors of Willis North America Inc.
1.10 Code means the Internal Revenue Code of 1986 as amended from time to
time. All references to specific Code sections are deemed to be
references to such sections as they may be amended or superseded.
1.11 Common Stock means Willis Group Holdings Limited common stock, par value
$0.000115 per share.
1.12 Company means Willis North America Inc. (formerly Willis Corroon
Corporation).
1.13 Company Matching Deposits means, collectively, the Company Basic
Matching Deposit (as defined in Section 3.01(b)(1) of the Plan) and the
Year-End Company Matching Deposit (as defined in Section 3.01(b)(2) of
the Plan).
1.14 Compensation
(a) Plan Compensation. For purposes of determining contributions to
the Plan, Plan Compensation means the Participant's base salary
plus commissions and compensation which is measured by the amount
of revenue produced, placed or serviced by the Employee and
includes amounts contributed through a salary reduction agreement
and which is not includible in the gross income of an Employee
under Sections 125, 132(f), and 402(e)(3) of the Code.
Plan Compensation shall not include overtime pay, annual bonuses
(including bonuses under Management Annual Incentive Plans and
Christmas bonuses) or bonuses received for reasons other than for
production, placement or servicing of business, amount of premiums
paid by Employer for group term life insurance and accidental
death and dismemberment insurance, dividends received on stock
granted under the Restricted Stock Award Program, value of amounts
which vest under the Restricted Stock Award Program (including
both stock and cash), compensation resulting from the exercise of
a non-qualified stock option, disqualifying disposition of stock
acquired pursuant to the exercise of an Incentive Stock Option or
resulting from the award or vesting of performance shares under
the Long Term Incentive Plan, moving expenses, car allowances,
finders fees, special prizes or awards, or any other amounts that
might otherwise be includible as compensation on a Form W-2. Only
compensation for the portion of any Plan Year during which an
Employee is a Participant shall be taken into account for purposes
of the Plan. Furthermore, any amounts paid to the Employee after
the last day of the last pay period of the month in which falls
the date sixty (60) days after the date the Employee separates
from service shall not be included in Plan Compensation and may
not be deferred pursuant to Section 3.01.
(b) Discrimination Compensation. For the purposes of discrimination
testing, Compensation will be as defined in Section 414(s) and the
regulations thereunder.
4
At the election of the Company, Discrimination Compensation will
include any amount which is contributed by the Employer pursuant
to a salary reduction agreement and which is not includible in the
gross income of an Employee under Sections 125, 132(f), and
402(e)(3) of the Code.
(c) Section 415 Compensation. For the purpose of applying the
limitations of Section 415 of the Code, Section 415 Compensation:
(1) Includes the Participant's wages, salaries, fees for
professional services, and other amounts received (without
regard to whether or not an amount is paid in cash) for
personal services actually rendered in the course of
employment with the employer maintaining the plan to the
extent that the amounts are includible in gross income
(including, but not limited to, commissions paid salesmen,
compensation for services on the basis of a percentage of
profits, commissions on insurance premiums, tips, bonuses,
fringe benefits, and reimbursements or other expense
allowances under a nonaccountable plan (as described in
ss.1.62-2(c)) plus, effective January 1, 1998, amounts not
includible in the gross income of the Employee under
Sections 125, 132(f), 402(e)(3), 402(h) or 403(b) of the
Code and
(2) does not include
(A) Employer contributions to a plan of deferred
compensation to the extent that, before the
application of the Section 415 limitations to that
plan, the contributions are not includible in the
gross income of the employee for the taxable year in
which contributed (including, prior to January 1,
1998, amounts contributed pursuant to a salary
reduction agreement which are excludible from gross
income under Sections 125, 402(e)(3) or 402(h) of the
Code) or distributions from a plan of deferred
compensation. However, any amount received by an
Employee pursuant to an unfunded nonqualified plan is
to be considered as Section 415 Compensation in the
year the amounts are includible in the gross income of
the Employee.
(B) Amounts realized from the exercise of a non-qualified
stock option, or when restricted stock (or property)
held by an Employee either becomes freely transferable
or is no longer subject to a substantial risk of
forfeiture.
(C) Amounts realized from the sale, exchange or other
disposition of stock acquired under a qualified stock
option.
(D) Other amounts which receive special tax benefits, such
as premiums for group-term life insurance (but only to
the extent that
5
the premiums are not includible in the gross income of
the Employee).
(3) Subsection (1) shall include foreign earned income (as
defined in Code Section 911(b)) whether or not excludible
from gross income under Code Sections 911, 931 or 933.
(d) Total Compensation means Section 415 Compensation plus, prior to
January 1, 1998, all amounts contributed by an Employer on behalf
of the Participant pursuant to a salary reduction agreement that
are not includible in the gross income of the Participant under
Sections 125, 132(f), 402(e)(3) and 402(h)(1)(B) of the Code.
Compensation for the purposes of this Section for any
determination period shall not exceed the limit on Compensation
prescribed in Section 401(a)(17) of the Code (the "Section
401(a)(17) Limit"). This limit is one hundred fifty thousand
dollars ($150,000), as adjusted for increases in the cost of
living in accordance with Section 401(a)(17)(B) of the Code. The
cost of living adjustment in effect on January 1 of any calendar
year shall apply to any determination period beginning in such
calendar year. For this purpose, the "determination period" is any
period not exceeding twelve (12) months over which Compensation is
determined. If a determination period consists of fewer than
twelve (12) months, the Section 401(a)(17) Limit will be
multiplied by a fraction, the numerator of which is the number of
months in the determination period, and the denominator of which
is twelve (12). Plan Compensation disregarded for the purpose of
determining the maximum Company Matching Deposit and the maximum
Year-End Company Matching Deposit shall likewise be disregarded
for the purpose of applying the 401(a)(17) Limit to such
determinations.
For Plan Years beginning before January 1, 1997, in determining
the Compensation of a Participant for purposes of this limitation,
the rules of Section 414(q)(6) of the Code shall apply, except in
applying such rules, the term "family" shall include only the
Spouse of the Participant and any lineal descendant of the
Participant who has not attained age nineteen (19) before the
close of the year. If, as a result of the application of such
rules, the adjusted Section 401(a)(17) Limit is exceeded, then
(except for purposes of determining the portion of Compensation up
to the integration level), the limitation shall be prorated among
the affected individuals in proportion to each such individual's
Compensation as determined under this Section prior to the
application of this limitation. This paragraph shall not apply for
Plan Years beginning on and after January 1, 1997.
1.15 Contribution Period means the payment period with respect to which the
Participant Deposits described in Section 3.01 are made on behalf of any
Participant.
1.16 Disability means a physical or mental incapacity which prevents a
Participant from performing the duties of any substantially gainful
activity considering his age, education and work experience, where: a)
such incapacity has continued for a period of six consecutive months, b)
the Benefits Committee has determined that such incapacity will
6
be of long and continuous duration, and c) the Participant is eligible
for and is receiving disability insurance benefits under the federal
Social Security Act. The Benefits Committee may require a Participant to
submit to a medical examination to confirm his disability.
Notwithstanding the above, a Participant shall not be considered to be
disabled if his disability: 1) resulted from or consists of habitual
drunkenness or self-addiction to or abuse of drugs, 2) was contracted,
suffered, or incurred while the Participant was engaged in, or resulted
from his having engaged in, a criminal enterprise, 3) was intentionally
self-inflicted, 4) resulted from an injury or disease sustained by the
Participant as a result of an act of war, or 5) arose out of service in
the armed forces of any country.
1.17 Effective Date means for an Employee, the effective date of the adoption
of the Plan by his Employer. The Effective Date of this Restatement
generally means September 1, 2001, except as otherwise provided herein.
1.18 Eligible Employee means an Employee (other than a leased employee)
employed by a Participating Employer, provided that such person is not
included in a unit of employees covered by a collective bargaining
agreement where retirement benefits were the subject of good faith
bargaining between the employee representative and the Employer but
shall not include any person who is a member of a class of Employees
excluded from participating in the Plan by action of the Board.
Notwithstanding the above, an individual receiving remuneration for
Services rendered to the Employer on a temporary basis shall not be an
Eligible Employee until such person is credited with one thousand
(1,000) Hours of Service within an Eligibility Computation Period.
1.19 Employee means any person employed by the Employer.
Employee also means a leased employee within the meaning of Section
414(n) of the Code. Effective January 1, 1997, the term "leased
employee" means any person (other than an employee of the recipient) who
pursuant to an agreement between the recipient and any other person
("leasing organization") has performed services for the recipient (or
for the recipient and related persons determined in accordance with
Section 414(n)(6) of the Code) on a substantially full-time basis for a
period of at least one year, and such services are performed under the
primary direction and control of the recipient employer. Contributions
or benefits provided a leased employee by the leasing organization that
are attributable to services performed for the recipient employer shall
be treated as provided by the recipient employer.
A leased employee shall not be considered an employee of the recipient
employer if: (i) such employee is covered by a money purchase pension
plan providing: (1) a nonintegrated employer contribution rate of at
least ten percent (10%) of compensation, as defined in Section 415(c)(3)
of the Code, but including amounts contributed pursuant to a salary
reduction agreement which are excludible from the employee's gross
income
7
under Sections 125, 402(e)(3), 402(h) or 403(b) of the Code, (2)
immediate participation, and (3) full and immediate vesting; and (ii)
leased employees do not constitute more than twenty percent (20%) of the
recipient employer's nonhighly compensated workforce.
1.20 Employer means the Company and any other subsidiary or affiliate of the
Company which, with the approval of the Board, and subject to such
conditions as the Board may impose, adopts this Plan. The basis of
participation shall be set forth in a Participation Agreement by and
between such Participating Employer and the Company. A Participating
Employer means any Employer who adopts this Plan for all or a portion of
its Employees.
1.21 Entry Date means the date on which an Eligible Employee becomes a
Participant after satisfying the eligibility requirements of the Plan.
The Entry Date is the Effective Date of the Plan and the first day of
any calendar month thereafter.
1.22 ERISA means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
1.23 Highly Compensated Employee means, effective January 1, 1997 any
employee of the Employer or of a member of the Affiliated Group who
(a) Was a five percent owner (as defined in Code Section 416(i)) for
such Plan Year or the prior Plan Year, or
(b) For the preceding Plan Year received Total Compensation in excess
of eighty thousand dollars ($80,000) and was among the highest 20
percent of employees for the preceding Plan Year when ranked by
Total Compensation paid for that year excluding, for purposes of
determining the number of such employees, such employees as the
Plan Administrator may determine on a consistent basis pursuant to
Section 414(q) of the Code. The eighty thousand dollar ($80,000)
amount in the preceding sentence shall be adjusted from time to
time for cost of living in accordance with Section 414(q) of the
Code.
Notwithstanding the foregoing, employees who are nonresident
aliens and who receive no earned income from the Employer or a
member of the Affiliated Group which constitutes income from
sources within the United States shall be disregarded for all
purposes of this Section.
The Employer's top-paid group election as described above, shall
be used consistently in determining Highly Compensated Employees
for determination years of all employee benefit plans of the
Employer and members of the Affiliated Group for which Section
414(q) of the Code applies (other than a multiemployer plan) that
begin with or within the same calendar year, until such election
is changed by Plan amendment in accordance with IRS requirements.
Notwithstanding the foregoing, the consistency provision in the
preceding sentence shall not apply for the Plan Year beginning in
1997, and for Plan Years beginning in 1998 and 1999, shall apply
only with respect to all qualified
8
retirement plans (other than a multiemployer plan) of the Employer
and members of the Affiliated Group.
The provisions of this Section shall be further subject to such
additional requirements as shall be described in Section 414(q) of
the Code and its applicable regulations, which shall override any
aspects of this Section inconsistent therewith.
1.24 Market Value means the price per share of Common Stock equal to the
closing price of the Common Stock on the relevant calculation date on
the New York Stock Exchange ("NYSE") or, if there shall have been no
sales on such exchange on such day, the most recent closing price of the
Common Stock on the NYSE on any preceding day.
1.25 Normal Retirement Date means the first day of the month coinciding with
or next following the date the Participant attains age sixty-five (65).
Normal Retirement Age means the Participant's sixty-fifth (65th)
birthday.
1.26 Participant means any Eligible Employee who becomes eligible to
participate in the Plan pursuant to Article II and who continues to be
entitled to any benefits under the Plan. Inactive Participant means any
Participant who is transferred to an employee group not eligible to
participate in the Plan, is transferred directly to a member of the
Affiliated Group which does not maintain the Plan for its employees, or
ceases to be an Employee but continues to be entitled to a benefit under
the Plan. Active Participant means a Participant other than an Inactive
Participant.
1.27 Plan means the Willis North America Inc. Financial Security Partnership
Plan as it may be amended from time to time. The Plan shall be deemed to
include the Trust.
1.28 Plan Year means:
(a) For years prior to January 1, 1989, the calendar year;
(b) A short Plan Year beginning January 1, 1989 and ending November
30, 1989;
(c) Effective December 1, 1989, the twelve (12) consecutive month
period beginning on each December 1 and ending on the following
November 30;
(d) Effective for the Plan Year beginning on December 1, 1994, a short
Plan Year beginning on December 1, 1994 and ending on December 31,
1994; and
(e) For all subsequent Plan Years, the twelve (12) consecutive month
period beginning on January 1 and ending on the next following
December 31.
1.29 Trust Agreement means the trust agreement and any and all amendments and
successor agreements thereto entered into between the Company and the
Trustee for the purpose of funding benefits under this Plan. The Trust
Agreement shall be deemed to be part of this Plan as if all of the terms
and provisions were fully set forth herein. The Company may
9
establish more than one trust agreement with different trustees and may
designate the Plan assets held pursuant to the terms of each Trust
Agreement.
1.30 Trust Fund means all sums of money, insurance or annuity contracts and
all other property including all earnings, appreciation, or additions,
held for the exclusive use of Plan Participants and their Beneficiaries,
from which benefits provided by this Plan will be paid.
1.31 Trustee means the Trustee or any successors thereto appointed by the
Board to administer the Trust Fund.
1.32 Valuation Date means the period beginning at the close of any business
day of the New York Stock Exchange ("NYSE") and shall extend until the
close of the next business day of the NYSE. For Plan assets not traded
on the NYSE, references to the NYSE shall include the relevant stock
exchange on which such assets are traded. The Committee may designate
such other Valuation Date(s) as may be necessary or desirable to assure
proper administration of the Plan. In no event shall there be less than
one Valuation Date within any twelve (12) consecutive month period.
The Committee may direct a special Valuation Date in order to avoid
prejudice either to continuing Participants or to terminating
Participants. Such special Valuation Date shall be deemed equivalent to
a regular Valuation Date. Adjustments hereunder shall apply uniformly to
all accounts hereunder.
1.33 Year of Service and other service measurements under the Plan shall be
determined utilizing the special definitions of this Section. Unless
otherwise specified, Service shall be credited for employment with any
member of the Affiliated Group, and with the approval of the Board, may
be credited for employment with an Employer prior to the time it became
a member of the Affiliated Group.
(a) Employment Commencement Date means the first day for which the
Employee is entitled to be credited with an Hour of Service for an
Employer maintaining the Plan. Reemployment Commencement Date
means the first date on which the Employee performs an Hour of
Service following a Period of Severance which is not required to
be taken into account under subsection (f) below.
(b) An Hour of Service means each hour for which:
(1) an Employee is paid or entitled to payment for the
performance of duties for the Employer;
(2) an Employee is paid, or entitled to payment, by the Employer
on account of a period of time during which no duties are
performed (irrespective of whether the employment
relationship has terminated) to the extent such hour must be
credited under Department of Labor Regulation
ss.2530.200b-2(a)(2);
10
(3) back pay, irrespective of mitigation of damages, is either
awarded or agreed to by the Employer.
(c) Years of Service means the sum of all Periods of Service and all
Credited Severance Periods measured in full years and completed
months. Periods of Service and Credited Severance Periods which
are less than whole years shall be aggregated on the basis that
twelve (12) months (thirty (30) days being deemed to be a month)
equal a whole Year of Service.
(d) A Period of Service means a period of service commencing on an
Employee's Employment Commencement Date or Reemployment
Commencement Date, whichever is applicable, and ending on the
Employee's Severance from Service Date.
(e) A Period of Severance means the period of time commencing on a
Severance Date and ending on the date the Employee again performs
an Hour of Service with the Employer. A one-year Period of
Severance means a 12-consecutive month period beginning on the
Severance Date, during which the Employee does not perform an Hour
of Service for the Employer.
(f) Credited Severance Period means any period described in (1) or (2)
below:
(1) If an Employee severs from service due to resignation,
discharge, or retirement and then performs an Hour of
Service within twelve (12) months of the Severance Date, the
Credited Severance Period shall include the Period of
Severance;
(2) If an Employee severs from service by reason of resignation,
discharge or retirement during an absence from service of
twelve (12) months or less (where such absence was for any
reason other than resignation, discharge, retirement or
death), and then performs an Hour of Service for the
Employer within twelve (12) months of the date on which the
Employee was first absent, Credited Severance Period shall
include the Period of Severance.
(g) Severance Date means the earlier of:
(1) The date the Employee resigns, retires, dies, or is
discharged from the Employer, or
(2) The first anniversary of the first date of a continuous
period in which an Employee remains absent from service
(with or without pay) with the Employer for any reason other
than resignation, retirement, discharge or death, such as
vacation, holiday, sickness, disability, leave of absence or
layoff. Provided, however, that an Employee who is absent
from
11
employment because he is on Armed Forces Leave shall not
incur a Severance Date under this subsection unless he fails
to return to active employment with a member of the
Affiliated Group within the period provided by law for the
protection of his re-employment rights.
(h) Special Maternity/Paternity Rule. The Severance Date of an
Employee who is absent from employment because of the Employee's
pregnancy, the birth of the Employee's child, the placement of a
child with the Employee in connection with the adoption of such
child by the Employee, or the need to care for such child for a
period beginning immediately following such birth or placement,
shall be the second anniversary of the first date of such absence.
The period between the first and second anniversaries of the first
date of absence from work shall be neither a Period of Service nor
a Period of Severance.
The above rule shall apply only if the Employee furnishes to the
Committee such timely information as it may require to establish
that the absence was for the reasons referred to above and the
period for which there was such an absence.
(i) Special Rule for Temporary Employees. Notwithstanding the above,
the following special definitions shall apply solely with respect
to Employees rendering services to the Employer on a temporary
basis:
(1) An Eligibility Computation Period means the twelve (12)
consecutive month period beginning on the date the Employee
first performs an Hour of Service for the Employer.
Provided, however, that succeeding Computation Periods shall
be based on the Plan Year, commencing with the Plan Year
which began immediately prior to the first anniversary of
the date the Employee first performed an Hour of Service.
(2) An Hour of Service means:
(A) Each hour for which an Employee is paid or entitled to
payment for the performance of duties for the Employer
during the applicable Computation Period.
(B) Each hour for which an employee is paid, or entitled
to payment, by the Employer on account of a period of
time during which no duties are performed
(irrespective of whether the employment relationship
has terminated) due to vacation, holiday, illness,
incapacity (including disability), layoff, jury duty,
military duty or leave of absence, except that
(i) not more than five hundred one (501) Hours of
Service shall be credited on account of any
single continuous period during which the
employee performs no duties (whether or not such
period occurs in a single computation period),
and
12
(ii) Hours of Service shall not be counted where such
payment is made or is due under a plan
maintained solely for the purpose of complying
with applicable worker's compensation,
unemployment or disability insurance laws, or
solely to reimburse an Employee for medical or
medically-related expenses.
(C) Each hour for which back pay, irrespective of
mitigation of damages, is either awarded or agreed to
by the Employer. However, the same Hours of Service
shall not be credited under both (1) and (2) above and
this section. No more than five hundred one (501)
Hours of Service shall be credited for payment of back
pay on account of any single continuous period, to the
extent that such back pay is agreed to or awarded for
a period of time during which an Employee did not or
would not have performed duties.
(D) To the extent required by law and not otherwise
credited under another provision of this Section, each
hour an Employee on Armed Forces Leave is or would
have been paid, directly or indirectly, or entitled to
payment under (1) above assuming that but for such
military service he would have been regularly engaged
in the performance of his duties. Such hours shall be
credited to the Computation Period in which he would
have been regularly engaged in the performance of his
duties but for such military service. Provided,
however, that no Hours of Service shall be credited
under this section unless the Employee returns to
active employment with a member of the Affiliated
Group within the period provided by law for the
protection of his re-employment rights.
Hours of Service for reasons other than the performance of
duties shall be determined and credited in accordance with
Department of Labor Regulation ss. 2530.200b-2(b) and (c),
which is incorporated herein by reference. In no event shall
the same Hours of Service be credited under more than one of
the applicable (A), (B), (C), or (D) above.
(3) A Year of Service means a Computation Period during which an
Employee is credited with at least one thousand (1000) Hours
of Service.
(4) A One-Year Break in Service means a Computation Period
during which an Employee fails to complete more than five
hundred (500) Hours of Service.
(5) Special Maternity/Paternity Rule. Solely for the purpose of
determining whether a Break in Service has occurred, an
Employee who is absent from
13
employment because of the Employee's pregnancy, the birth of
the Employee's child, the placement of a child with the
Employee in connection with the adoption of such child by
the Employee, or the need to care for such child for a
period beginning immediately following such birth or
placement, be credited with:
(A) The Hours of Service which otherwise would normally
have been credited to such individual but for such
absence, or
(B) In any case in which the Plan Administrator is unable
to determine the hours described above, eight (8)
Hours of Service per day of such absence.
The above rule shall apply only if the Employee furnishes to
the Plan Administrator such timely information as it may
require to establish that the absence was for the above
reasons and to determine the number of days of such absence.
Hours of Service shall be credited in the Computation Period
in which the absence from work begins if such credit is
necessary to prevent a Break in Service in that period. In
any other case, such Hours of Service be credited in the
immediately following Computation Period. In no event shall
more than five hundred one (501) Hours of Service be
credited because of such pregnancy or placement.
(6) Family and Medical Leave. Solely to the extent required by
law, an Employee who is absent from employment because of a
leave of absence under the Family and Medical Leave Act of
1993 shall receive credit for Hours of Service during such
absence. Provided, however, that the same Hours of Service
shall not be credited under both this subsection and any
other provision of this Section.
(j) Change in Status.
(1) A Year of Service for eligibility purposes with respect to
an Employee who is hired on a temporary basis shall continue
to be measured under the rules set out in subsection (i)
above if such Employee subsequently assumes full-time
employee status prior to incurring a One-Year Break in
Service.
(2) A Year of Service for eligibility purposes with respect to
an Employee who is hired on a full-time basis shall continue
to be measured under the rules set out in subsection (c)
above unless such Employee becomes employed on a temporary
basis after incurring a one-year Period of Severance.
14
(k) Family and Medical Leave. Solely to the extent required by law, an
Employee who is absent from employment because of a leave of
absence under the Family and Medical Leave Act of 1993 shall
receive credit for Hours of Service during such absence. Provided,
however, that the same Hours of Service shall not be credited
under both this subsection and any other provision of this
Section.
15
ARTICLE II
Eligibility to Participate
2.01 Eligibility Requirements. Each Eligible Employee who was a Participant
in the Plan prior to the Effective Date of this Restatement shall
continue to be a Participant. All other Eligible Employees shall become
eligible to participate in the Plan on the first Entry Date coinciding
with or next following the later of completion of three months of
Service and the completion of the application process established by the
Benefits Committee, at least thirty days prior to such Entry Date or
within such other time period established by the Plan Administrator.
Notwithstanding the above, no Eligible Employee shall become a
Participant prior to the Plan's Effective Date with respect to that
Eligible Employee.
The Board, in its discretion, may waive the three (3) months Service
requirement with respect to an Eligible Employee of any entity
subsequently acquired by the Company who had previously been a
participant in such entity's Section 401(k) plan.
2.02 Participation upon Reemployment.
(a) An Eligible Employee who has completed one (1) Year of Service but
who separates from service before the next Entry Date, shall
become a Participant immediately upon reemployment if he returns
to employment prior to incurring a one-year Period of Severance.
(b) A Participant who is reemployed as an Eligible Employee after
incurring a one-year period of Severance shall be eligible to
participate in the Plan immediately upon performance of an Hour of
Service, provided that in the case of a Participant who did not
have a non-forfeitable right to benefits derived from employer
contributions at the time of separation, the Period of Severance
did not equal or exceed the greater of five (5) years or the
aggregate number of Years of Service before such period.
(c) A Participant who did not have a non-forfeitable right to benefits
derived from employer contributions at the time of separation, and
whose Period of Severance equaled or exceeded the greater of five
(5) years or the aggregate number of Years of Service before such
period shall be treated as a new employee upon reemployment, and
any prior Years of Service shall not be taken into account for
eligibility or vesting purposes.
2.03 Inactive Participants. An Inactive Participant shall continue to be
credited with Years of Service for eligibility and vesting purposes
until employment with the Employer or member of the Affiliated Group
ceases but shall not be eligible to make Deposits or to have
contributions made on his behalf. Except as provided in Section 2.02, an
Inactive
16
Participant shall again become a Participant in the Plan upon return to
employment with an Employer as an Eligible Employee.
2.04 Determination of Eligibility. The eligibility of an Employee shall be
determined by the Plan Administrator based upon information furnished by
the Employee or Employer, as appropriate. This determination shall be
conclusive and binding on all parties.
17
ARTICLE III
Contributions
3.01 Employer Contributions. Subject to the limitations set forth in Sections
3.03, 3.04, 3.05, 3.06, 3.07, and 3.08, contributions may be made on
behalf of a Participant as follows:
(a) Before-Tax Deposits. A Participant's Before-Tax Deposits will be
the amount of a Participant's Plan Compensation that a Participant
elects to have the Employer contribute to the Plan. A Participant
may elect to reduce his Plan Compensation by a specified
percentage indicated pursuant to his enrollment application. Such
reduction, which must be expressed in whole percentages, shall be
no less than one percent (1%) and shall not exceed twenty percent
(20%) of Plan Compensation. Such election must be made in
accordance with the rules and procedures established by the Plan
Administrator and provided to the Participant prior to his Entry
Date or, with respect to subsequent changes in such rules and
procedures, the effective date of such changes. Before-Tax
Deposits shall be contributed to the Trust as soon as practicable
after the end of each applicable Contribution Period (but in no
event later than the fifteenth business day of the month following
the month in which the amounts would otherwise have been payable
to the Participant if the amount had not been deferred pursuant to
this Section unless this time period is extended as provided in
Labor Regulation Section 2510.3-102).
Such deposits shall be allocated to the Participant for whom such
contributions were made and credited to the Participant Account
maintained for such Participant pursuant to Section 4.01.
(b) Company Matching Deposits.
(1) Basic Company Matching Deposit. The Employer shall make
Company Matching Deposits in an amount equal to one hundred
percent (100%) of the Before-Tax Deposits made by the
Participant. Such Company Matching Deposits shall not exceed
three percent (3%) of the Participant's Plan Compensation
for the Contribution Period.
However, no Basic Company Matching Deposit shall be made on
behalf of a Participant for a Contribution Period ending
before the first day of the calendar month beginning after
the Participant completes a Year of Service. Plan
Compensation earned prior to the Contribution Period ending
before the first day of the calendar month beginning after
the Participant completes a Year of Service shall likewise
be disregarded.
The Board, in its discretion, may waive the one (1) Year of
Service requirement with respect to an Eligible Employee of
any entity
18
subsequently acquired by the Company who had previously been
a participant in such entity's Section 401(k) plan.
(2) Year End Company Matching Deposit. In addition, the Employer
shall make Year End Company Matching Deposits for eligible
Participants in an amount equal to (i) minus (ii) where:
(i) is 100% of the Before-Tax Deposits made by the
Participant during the Plan Year but not to exceed
three percent (3%) of the Participant's Plan
Compensation. For the purpose of this subparagraph
(i), Plan Compensation earned during Contribution
Periods ending before the first day of the calendar
month beginning after the Participant completes a Year
of Service shall be disregarded.
(ii) is the Company Matching Deposit made for the
Participant under subsection (1) for the Plan Year.
A Participant must be actively employed by the Employer on
the last day of the Plan Year to receive a Year End Company
Matching Deposit with respect to the Plan Year. A
Participant shall not be considered to be other than an
active Employee on such date solely because the Participant
is absent from employment because of a leave of absence
under the Family and Medical Leave Act of 1993.
The Board, in its discretion, may waive the one (1) Year of
Service requirement in subparagraph (i) with respect to an
Eligible Employee of any entity subsequently acquired by the
Company who had previously been a participant in such
entity's Section 401(k) plan.
Company Matching Deposits shall be contributed to the Trust
by the Employer no later than the time prescribed by law for
the filing of its federal income tax return for the taxable
year in which the Plan Year ends, including extensions which
have been granted for filing such return.
Such deposits shall be allocated to the Participant for whom
such contributions were made and credited to the Participant
Account maintained for such Participant pursuant to Section
4.01.
(c) The Employer's contribution for any taxable year shall not exceed
the maximum amount allowable as a deduction to the Employer under
Section 404 of the Code.
(d) The maximum amount of Company Matching Deposits to be made on
Before-Tax Deposits may be increased or decreased at the
discretion of the Board at any time.
19
(e) The source of all Employer contributions shall be current and/or
accumulated profits.
(f) Allocations of Company Deposits and forfeitures will not be
discontinued or decreased because of the Participant's attainment
of any age.
(g) In satisfaction of its contribution obligation under this Section,
the Company may, at its option, deliver either cash or Willis
Group Holdings Limited Common Stock. In the event the Company
elects to satisfy its contribution obligation in shares of Common
Stock, the number of shares of Common Stock that shall be
delivered to the Trustee shall be equal to the quotient of (x) the
dollar amount of the contribution obligation elected to be
satisfied in Common Stock, divided by (y) the Market Value on the
date of delivery.
3.02 Modifying Levels of Deposits.
(a) Changing Level of Deposits.
A Participant may change the level of Before-Tax Deposits at any
time to be effective with the first pay period of any calendar
month provided that the Committee receives notice on or before the
last day of the previous month or such other date reasonably
determined by the Plan Administrator.
(b) Suspending Deposits.
A Participant may cease making Before-Tax Deposits at any time
provided that he notifies the Committee as soon as practicable
prior to the date contributions are to cease. No Company Matching
Deposits shall be made on behalf of a Participant during any
period during which Before-Tax Deposits are suspended.
(c) Resuming Deposits.
A Participant may resume payroll deduction on the first day of any
month after appropriate notice to the Employer.
(d) Trading Restrictions.
Notwithstanding any other provision of the Plan, to the extent
that a Participant, because of his position with the Employer, is
restricted by law from trading in Common Stock during specified
periods, such Participant shall not exercise the elections in this
Section in any manner that would violate such restrictions.
20
(e) Method of Notice.
Any notice provided by the Participant pursuant to this Section
shall be given in accordance with rules and procedures established
by the Plan Administrator and provided to the Participant upon
request.
3.03 Maximum Annual Additions.
(a) The maximum Annual Addition credited for a Limitation Year shall
equal the lesser of: (i) thirty thousand dollars ($30,000),
adjusted as provided in Section 415(d) of the Code for cost of
living increases, or (ii) twenty-five percent (25%) of the
Participant's Section 415 Compensation for such Limitation Year.
(b) Annual Addition means the sum credited to the Participant's
Accounts for any Limitation Year of
(1) Employer contributions (including any allocations of
employer contributions under a simplified employee pension),
employee contributions and forfeitures;
(2) Amounts allocated to an individual medical account as
described in Section 415(l)(1) of the Code which is part of
a pension or annuity plan maintained by the Employer; and
(3) Amounts that are attributable to post-retirement medical
benefits allocated to the separate account of a key employee
as described in Section 419A(d)(2) of the Code.
(c) Limitation Year generally means calendar year, unless the Company
elects a different twelve (12) consecutive month period as
provided by Treasury Regulation Section 1.415-2(b).
(d) The following procedures shall apply if, as a result of an
allocation of forfeitures, a reasonable error in estimating
compensation, a reasonable error in determining the amount of
Before-Tax Deposits that may have been made with respect to an
individual under the limits set forth in Section 3.03(a), or for
any other reason permitted by the Internal Revenue Service, the
Annual Addition for a Participant exceeds the maximum permitted
under Section 3.03(a) as of the end of a Limitation Year:
(i) If the Participant is covered by the Plan at the end of the
Limitation Year, such excess will be used to reduce employer
contributions (including any allocation of forfeitures) for
such Participant in the next Limitation Year and each
succeeding Limitation Year, if necessary.
(ii) If excess Annual Additions exist after application of
subsection (i) and the Participant is not covered by the
Plan at the end of the Limitation Year, such excess will be
held unallocated in a suspense account. The suspense
21
account will be used to reduce future contributions to the
Plan by the Employer (including any allocation of
forfeitures) for all remaining Participants in the next
Limitation Year and each succeeding Limitation Year, if
necessary.
(iii) A suspense account in existence at any time during the
Limitation Year pursuant to this Section 3.03(d) shall not
participate in the allocation of the Trust's investment
gains and losses.
(e) If a short Limitation Year is created because of an initial short
Plan Year or an amendment changing the Limitation Year to a
different twelve (12) consecutive month period, the maximum
permissible amount prescribed in (a) will not exceed the defined
contribution dollar limitation multiplied by the following
fraction:
Number of Months in the Short Limitation Year
---------------------------------------------
12
3.04 Combined Plan Limits. This Section shall be effective for Limitation
Years commencing prior to January 1, 2000.
(a) In addition to the limitations in Section 3.03 and notwithstanding
other provisions of the Plan, in any case in which an individual
is a Participant in this Plan and in a defined benefit plan
qualified under Section 401(a) of the Code which at any time was
maintained by any member of the Affiliated Group, the sum of the
Defined Benefit Plan Fraction and the Defined Contribution Plan
Fraction for any year may not exceed one.
(b) The Defined Benefit Plan Fraction for any year is a fraction,
(1) the numerator of which is the Participant's projected annual
retirement benefit under any defined benefit plans qualified
under Section 401(a) of the Code maintained by the Employer
or by any other member of the Affiliated Group, and
(2) the denominator of which is the lesser of
(A) One hundred twenty-five percent (125%) of the dollar
limitation in effect under Section 415(b)(1)(A) for
such year or the benefit in existence on July 1, 1982;
or
(B) One hundred forty percent (140%) of the Participant's
average Compensation for the three (3) consecutive
years during which the Participant was active in the
Plan which produce the highest aggregate amount.
22
(c) The Defined Contribution Plan Fraction for any year is a fraction,
(1) the numerator of which is the sum of the Participant's
Annual Additions as defined in Section 415(c) of the Code
applied to the Participant's accounts, under this Plan and
under all other defined contribution plans qualified under
Section 401(a) of the Code, including voluntary
contributions to any defined benefit plans) which at any
time were maintained by any member of the Affiliated Group
for the current and all prior Limitation Years, and
(2) the denominator of which is the sum of the maximum aggregate
amounts of Annual Additions to the Participant's accounts
for the current and all prior Limitation Years if in each
such year the Annual Additions equaled the lesser of one
hundred twenty five percent (125%) of the dollar limitation
in effect under Section 415(c)(1)(A) of the Code or
thirty-five percent (35%) of the Participant's Section 415
Compensation for such year.
Provided, however, that if the Plan satisfied the applicable
requirements of Section 415 as in effect for all Limitation
Years beginning before January 1, 1987, an amount shall be
subtracted from the numerator of the defined contribution
plan fraction as prescribed by the Secretary of the Treasury
so that the sum of the Defined Benefit Fraction and the
Defined Contribution Fraction does not exceed one for such
Limitation Year.
(d) At the election of the Employer, in applying Section 3.04(c) with
respect to any year ending after December 31, 1982, the amount
taken into account under Section 3.04(c)(2) with respect to each
Participant for all years ending before January 1, 1983, shall be
an amount equal to the product of--
(1) the amount determined under paragraph Section 3.04(c)(2) (as
in effect for the year ending in 1982) for the year ending
in 1982, multiplied by
(2) the Transition Fraction.
Transition Fraction.--The term "Transition Fraction" means a
fraction--
(1) the numerator of which is the lesser of--
(A) fifty one thousand eight hundred seventy-five
dollars ($51,875), or
(B) one point four (1.4), multiplied by twenty-five
percent (25%) of the compensation of the
participant for the year ending in 1981, and
(2) the denominator of which is the lesser of--
(A) forty one thousand five hundred dollars
($41,500), or
23
(B) twenty-five percent (25%) of the Section 415
Compensation of the participant for the year
ending in 1981.
(e) In the event the limits of this Section 3.04 are exceeded in any
Limitation Year, contributions to this Plan shall be reduced to
extent necessary to satisfy the combined plan limits.
3.05 Limitation on Before-Tax Deposits.
(a) For each calendar year, no Participant shall be permitted to have
Before-Tax Deposits made under the Plan, or any other qualified
plan maintained by the Employer, in excess of the dollar
limitation contained in Section 402(g) of the Code in effect at
the beginning of such calendar year.
(b) Return of Excess Deferral Amounts
(1) The Plan may return contributions described in Section
402(g)(3) of the Code which exceed the dollar limitation
described in (a) above for a calendar year to the
Participant on whose behalf such contributions were made,
and the Earnings (as defined below) allocable to such Excess
Deferral Amount, no later than April 15 of the year
following the calendar year in which such contributions were
made. The amount to be distributed to the Participant may
not exceed his Before-Tax Deposits for such calendar year.
(2) A Participant seeking the return of an Excess Deferral
Amount for the preceding calendar year must submit such
request in writing to the Employer no later than March 1.
The claim must specify the Participant's Excess Deferral
Amount for such year and must be accompanied by the
Participant's written statement that if such amounts are not
distributed, such Excess Deferral Amount, when added to
amounts deferred under other plans or arrangements described
in Sections 401(k), 408(k) or 403(b) of the Code, will
exceed the limit imposed on the Participant by Section
402(g) of the Code for the year in which the deferral
occurred. To the extent that a Participant has an Excess
Deferral Amount for the calendar year taking into account
only Before-Tax Deposits under this Plan and any elective
deferrals under any other plan of the Employer, the
Participant is deemed to have notified the Employer of and
to have requested a return of such Excess Deferral Amount
pursuant to this Section 3.05(b).
(3) "Earnings" means the amount of income to be returned with
any Excess Deferrals. Earnings on Excess Deferrals shall be
determined by multiplying the income earned on the
Before-Tax Deposit Account for the Plan Year to which the
Excess Deferrals relate by a fraction, the numerator of
which is the Excess Deferral, for the Plan Year and the
denominator of
24
which is the Before-Tax Deposit Account balance at the end
of the Plan Year, disregarding any income or loss occurring
during the Plan Year.
(4) Notwithstanding any other provision of the Plan to the
contrary, in the event a Participant receives a distribution
of Excess Deferrals pursuant to this Section, any Company
Matching Deposit that relates to such Excess Deferrals shall
be forfeited. Such forfeitures shall be treated in the same
manner as forfeitures arising under Article V, except that
forfeitures arising under this Section shall not be
allocated to the account of any Highly Compensated Employee.
3.06 Nondiscrimination Requirements for Before-Tax Deposits.
With respect to each Plan Year commencing on or after January 1, 1997,
the Actual Deferral Percentage for that Plan Year for Highly Compensated
Employees who are Participants or eligible to become Participants for
that Plan Year shall not exceed the greater of:
(a) The Actual Deferral Percentage for the Plan Year for all
non-Highly Compensated Employees for the Plan Year who were
Participants or eligible to become Participants during the Plan
Year multiplied by 1.25, or
(b) The lesser of (i) the Actual Deferral Percentage for the Plan Year
for all non-Highly Compensated Employees for the Plan Year who
were Participants or eligible to become Participants during the
Plan Year multiplied by 2.0, and (ii) the Actual Deferral
Percentage for the Plan Year for all such non-Highly Compensated
Participants during the Plan Year plus two percentage points (or
such lesser amount as the Plan Administrator shall determine to
satisfy the provisions of Section 3.08).
Notwithstanding the foregoing, the Employer may elect to use the
Actual Deferral Percentage for non-Highly Compensated Employees
for the Plan Year preceding the Plan Year being tested rather than
the Plan Year being tested provided that such election must be
evidenced by a Plan amendment and once made may not be changed
except as provided by the Secretary of the Treasury.
The Plan Administrator may implement rules limiting the Before-Tax
Deposits that may be made on behalf of some or all Highly
Compensated Employees so that this limitation is satisfied.
3.07 Nondiscrimination Requirements for Company Matching Deposits.
With respect to each Plan Year commencing on or after January 1, 1997,
the Actual Contribution Percentage for that Plan Year for Highly
Compensated Employees who are Participants or eligible to become
Participants for that Plan Year shall not exceed
25
(a) The Actual Contribution Percentage for the Plan Year for all
non-Highly Compensated Employees for the Plan Year who were
Participants or eligible to become Participants during the Plan
Year multiplied by 1.25, or
(b) The lesser of (i) the Actual Contribution Percentage for the Plan
Year for all non-Highly Compensated Employees for the Plan Year
who were Participants or eligible to become Participants during
the Plan Year multiplied by 2.0, and (ii) the Actual Contribution
Percentage for the Plan Year for all such non-Highly Compensated
Participants during the Plan Year plus two percentage points (or
such lesser amount as the Plan Administrator shall determine to
satisfy the provisions of Section 3.08).
Notwithstanding the foregoing, the Employer may elect to use the
Actual Contribution Percentage for non-Highly Compensated
Employees for the Plan Year preceding the Plan Year being tested
rather than the Plan Year being tested provided that such election
must be evidenced by a Plan amendment and once made may not be
changed except as provided by the Secretary of the Treasury.
3.08 Restriction on Multiple Use of Alternative Limitations.
(a) In the event one or more Highly Compensated Employees are eligible
to have both Before-Tax Deposits and either Company Matching
Deposits or any other type of contribution subject to the Actual
Contribution Percentage test that is aggregated with contributions
under this Plan pursuant to Section 3.09, the Plan will not be
deemed to have satisfied the nondiscrimination requirements of
Sections 3.06 and 3.07 unless the Actual Deferral Percentage and
Actual Contribution Percentage for Highly Compensated Employees
for each Plan Year cannot exceed the greater of:
(1) The sum of:
(A) The greater of the Actual Deferral Percentage or
Actual Contribution Percentage for the Plan Year for
all non-Highly Compensated Employees for the Plan Year
who were Participants or eligible to become
Participants during the Plan Year multiplied by 1.25,
plus
(B) The lesser of (i) the lesser of the Actual Deferral
Percentage or the Actual Contribution Percentage for
the Plan Year for all non-Highly Compensated Employees
for the Plan Year who were Participants or eligible to
become Participants during the Plan Year multiplied by
2.0 and (ii) the lesser of the Actual Deferral
Percentage or Actual Contribution Percentage for the
Plan Year for all such non-Highly Compensated
Participants during the Plan Year plus two percentage
points.
26
(2) The sum of:
(A) The lesser of the Actual Deferral Percentage or Actual
Contribution Percentage for the Plan Year for all
non-Highly Compensated Employees for the Plan Year who
were Participants or eligible to become Participants
during the Plan Year multiplied by 1.25, plus
(B) The lesser of (i) the greater of the Actual Deferral
Percentage or the Actual Contribution Percentage for
the Plan Year for all non-Highly Compensated Employees
for the Plan Year who were Participants or eligible to
become Participants during the Plan Year multiplied by
2.0 and (ii) the greater of the Actual Deferral
Percentage or Actual Contribution Percentage for the
Plan Year for all such non-Highly Compensated
Participants during the Plan Year plus two percentage
points.
or satisfies such other tests as may be promulgated under
Section 401(m) of the Code and the regulations thereunder.
(b) In the event the aggregate limit is exceeded for any Plan Year,
the Actual Contribution Percentages of the Highly Compensated
Employees shall be reduced to the extent necessary to satisfy the
aggregate limit in accordance with the procedure set forth in
Section 3.07.
3.09 Additional Discrimination Testing Provisions.
(a) If any Highly Compensated Employee is a member of another
qualified plan of the Employer or a member of the Affiliated
Group, other than an employee stock ownership plan described in
Section 4975(e)(7) of the Code or any other qualified plan which
must be mandatory disaggregated under Section 410(b) of the Code,
under which deferred cash contributions or matching contributions
are made on behalf of the Highly Compensated Employee or under
which the Highly Compensated Employee makes after-tax
contributions, the Plan Administrator shall implement rules, which
shall be uniformly applicable to all employees similarly situated,
to take into account all such contributions for the Highly
Compensated Employee under all such plans in applying the
limitations of Sections 3.06, 3.07, and 3.08. If any other such
qualified plan has a plan year other than the Plan Year defined in
Section 1.25, the contributions to be taken into account in
applying the limitations of Sections 3.06, 3.07, and 3.08 will be
those made in the plan years ending with or within the same
calendar year.
(b) In the event that this Plan is aggregated with one or more other
plans to satisfy the requirements of Sections 401(a)(4) and 410(b)
of the Code (other than for purposes of the average benefit
percentage test) or if one or more other plans is aggregated with
this Plan to satisfy the requirements of such sections of the
Code,
27
then the provisions of Sections 3.06, 3.07, and 3.08 shall be
applied by determining the Actual Deferral Percentage and Actual
Contribution Percentage of employees as if all such plans were a
single plan. If this Plan is permissively aggregated with any
other plan or plans for purposes of satisfying the provisions of
Section 401(k)(3) of the Code, the aggregated plans must also
satisfy the provisions of Sections 401(a)(4) and 410(b) of the
Code as though they were a single plan. For Plan Years beginning
after December 31, 1989, plans may be aggregated under this
paragraph (b) only if they have the same plan year.
(c) The Employer may elect to use Before-Tax Deposits to satisfy the
tests described in Sections 3.07, and 3.08, provided that the test
described in Section 3.06 is met prior to such election, and
continues to be met following the Employer's election to shift the
application of those Before-Tax Deposits from Section 3.06 to
Section 3.07.
(d) Notwithstanding any provision of the Plan to the contrary, if
employees included in a unit of employees covered by a collective
bargaining agreement are participating in the Plan and not more
than 2 percent of such employees are Highly Compensated Employees
and professionals, then such employees shall be disregarded in
applying the provisions of Sections 3.06, 3.07, and 3.08. However,
a separate Actual Deferral Percentage test must be performed for
the group of collective bargaining employees on and after January
1, 1993 on the basis that those employees are included in a
separate cash-or-deferred arrangement.
(e) For Plan Years commencing on and after January 1, 1999, if the
Employer elects to apply the provisions of Section 410(b)(4)(B) to
satisfy the requirements of Section 401(k)(3)(A)(i) of the Code,
the Employer may apply the provisions of Sections ADP, ACP, and
Multiple Use test Sections by excluding from consideration all
eligible employees (other than Highly Compensated Employees) who
have not met the minimum age and service requirements of Section
410(a)(1)(A) of the Code.
(f) If the Employer does not apply the special rule in subsection (e)
above, the Employer may elect to apply the provisions of Treas.
Reg. ss.1.401(k)-1(b)(3)(ii) and treat the portion of the Plan
benefiting Participants who have satisfied the minimum
requirements of Code Section 410(a)(1)(a) and the portion of the
Plan benefiting Participants who have not satisfied such
requirements as two separate Plans for the purpose of applying
Code Sections 401(k) and 410(b), in accordance with the
regulations thereunder.
3.10 Qualified Matching Contributions, Qualified Nonelective Contributions.
The Employer may authorize that special "Qualified Nonelective
Contributions" (on the basis of either a specified dollar amount or
specified percentage of Compensation) and/or "Qualified Matching
Contributions" (with respect to Before-Tax Deposits) shall be made for a
Plan Year, which shall be allocated in such amounts and to such
Participants, who are not Highly Compensated Employees, as the Plan
Administrator shall determine. The Plan
28
Administrator shall establish such separate accounts as may be
necessary. Qualified Nonelective Contributions and Qualified Matching
Contributions shall be one hundred percent (100%) nonforfeitable when
made. Qualified Nonelective Contributions and Qualified Matching
Contributions made before January 1, 1989 and earnings credited thereon
as of that date may only be withdrawn by a Participant while in service
under the provisions of Sections 7.01 or 7.02. Any Qualified Nonelective
Contributions and Qualified Matching Contributions made on or after
January 1, 1989 and any earnings credited on any Qualified Nonelective
Contributions and Qualified Matching Contributions after such date shall
only be available for withdrawal under the provisions of Section 7.02.
Qualified Nonelective Contributions and Qualified Matching Contributions
made for the Plan Year may be used to satisfy the tests described in
Sections 3.06, 3.07 and 3.08, where necessary. Qualified Nonelective
Contributions and Qualified Matching Contributions may be taken into
account in determining the Actual Deferral Percentage or Actual
Contribution Percentage of the non-Highly Compensated Employees for the
preceding Plan Year under Section 3.06 and/or 3.07 provided the
contributions are credited to Participants' accounts no later than the
last day of the preceding Plan Year and are contributed to the Plan no
later than the last day of the Plan Year being tested.
3.11 Correction Methods.
(a) Actual Deferral Percentage Test. If the Plan Administrator
determines that the limitation under Section 3.06 has been
exceeded in any Plan Year, the following provisions shall apply:
(1) The Actual Deferral Ratio of the Highly Compensated Employee
with the highest Actual Deferral Ratio shall be reduced to
the extent necessary to meet the Actual Deferral Percentage
test of Section 3.06 or to cause such ratio to equal the
Actual Deferral Ratio of the Highly Compensated Employee
with the next highest Actual Deferral Ratio. This process
will be repeated until the Actual Deferral Percentage test
of Section 3.06 is passed. Each ratio shall be rounded to
the nearest one one-hundredth of one percent of the
Participant's Discrimination Compensation. The amount of a
Highly Compensated Employee's Before-Tax Deposits in excess
of the amount permitted under his or her revised Actual
Deferral Ratio shall be added together. This total dollar
amount of excess contributions ("Excess Contributions")
shall then be allocated to some or all Highly Compensated
Employees in accordance with the provisions of paragraph (2)
below.
(2) The Before-Tax Deposits of the Highly Compensated Employee
with the highest dollar amount of such contributions shall
be reduced by the lesser of (i) the amount required to cause
that Employee's Before-Tax Deposits to equal the dollar
amount of such contributions of the Highly Compensated
Employee with the next highest dollar amount of such
29
contributions, or (ii) an amount equal to the total Excess
Contributions. This procedure is repeated until all Excess
Contributions are allocated.
(3) The Excess Contributions together with Earnings thereon,
allocated to a Highly Compensated Employee under paragraph
(2) above shall be paid to the Participant before the close
of the Plan Year following the Plan Year in which the Excess
Contributions were made, and to the extent practicable,
within 2 1/2 months of the close of the Plan Year in which
the Excess Contributions were made. However, any Excess
Contributions for any Plan Year shall be reduced by any
Before-Tax Deposits previously returned to the Participant
under Section 3.06 for that Plan Year.
Excess Contributions shall be distributed from the
Participant's Before-Tax Deposit Account and from his
Qualified Matching Contribution Account if applicable) in
proportion to the Participant's Before-Tax Deposits and
Qualified Matching Contributions used in the test under
Section 3.06 for the Plan Year. Excess Contributions shall
be distributed from the Participant's Qualified Nonelective
Contribution Account only to the extent the Excess
Contributions exceed the balance in the Participant's
Before-Tax Deposit Account and Qualified Matching
Contribution Account.
In the event any Before-Tax Deposits returned under this
Section were matched by Company Matching Deposits other than
Qualified Matching Contributions, such corresponding Company
Matching Deposits, with Earnings thereon, shall be
forfeited. Such forfeitures shall be treated in the same
manner as forfeitures arising under Article V, except that
forfeitures arising under this Section shall not be
allocated to the account of any Highly Compensated Employee.
(4) In the event any Company Matching Deposits subject to
forfeiture under this Section have been distributed to the
Participant, the Employer shall make reasonable efforts to
recover the contributions from the Participant.
(b) The Actual Contribution Percentage Test. If the Plan Administrator
determines that the limitation under Section 3.07 has been
exceeded in any Plan Year, the following provisions shall apply:
(1) Subsection (a)(1) and (2) shall apply, after substituting
"Actual Contribution Ratio", "Actual Contribution
Percentage", "Excess Aggregate Contributions" and "Company
Matching Deposits" for "Actual Deferral Ratio", "Actual
Deferral Percentage" "Excess Contributions", and "Before-Tax
Deposits", respectively.
30
(2) Excess Aggregate Contributions, together with Earnings
thereon, allocated to a Highly Compensated Employee under
paragraph (1) above shall be distributed or forfeited as
follows:
(A) Company Matching Deposits made with respect to Highly
Compensated Employees which exceed the maximum amount
permitted under the Actual Contribution Percentage
Test of Section 3.07, and Earnings allocable thereto,
shall be forfeited, if otherwise forfeitable under the
terms of the Plan.
(B) Nonforfeitable Company Matching Deposits that exceed
the maximum amount permitted under the Actual
Contribution Percentage Test of Section 3.07 plus any
Earnings allocable thereto, shall be paid to the
Highly Compensated Employees with respect to whom such
Excess Aggregate Contributions were made.
(3) Any repayment or forfeiture of Excess Aggregate
Contributions shall be made before the close of the Plan
Year following the Plan Year for which the Excess Aggregate
Contributions were made, and to the extent practicable, any
repayment or forfeiture shall be made within 2 1/2 months of
the close of the Plan Year in which the Excess Aggregate
Contributions were made. In the event any Company Matching
Deposits subject to forfeiture have been distributed to the
Participant, the Employer shall make reasonable efforts to
recover the contributions from the Participant.
(4) Amounts distributed to or forfeited by Highly Compensated
Employees under this Section shall be treated as Annual
Additions under Section 3.03. Amounts forfeited by Highly
Compensated Employees under this Section shall be treated in
the same manner as forfeitures arising under Article V
except that forfeitures arising under this Section shall not
be allocated to the account of any Highly Compensated
Employee
(c) "Earnings" means the amount of income to be returned with any
Excess Contributions or Excess Aggregate Contributions. Earnings
on Excess Contributions shall be determined by multiplying the
income earned on the Before-Tax Deposit Account for the Plan Year
to which the Excess Contributions relate by a fraction, the
numerator of which is the Excess Contributions for the Plan Year
and the denominator of which is the Before-Tax Deposit Account
balance at the end of the Plan Year, disregarding any income or
loss occurring during the Plan Year. Earnings on Excess Aggregate
Contributions shall be determined in a similar manner by
substituting the sum of the Participant's Company Matching Deposit
Account (effective September 1, 2001, the Stock-Based Company
Matching Deposit Account) for the Before-Tax Deposit Account, and
the Excess Aggregate Contributions for the Excess Contributions in
the preceding sentence.
31
3.12 Rollovers and Transfers.
(a) An Employee, regardless of whether he has satisfied the
eligibility requirements of Article II, who has received a
distribution of all or part of his interest in a plan which meets
the requirements of Section 401(a) of the Code may, in accordance
with procedures established by the Plan Administrator, transfer
the distribution to the Trust, instruct the Trust to accept such
distribution directly from the distributing plan, provided the
following conditions are met:
(1) the distribution qualified for rollover pursuant to Section
402(a)(5) of the Code is an Eligible Rollover Distribution
as defined in Section 6.07;
(2) the transfer occurs on or before the sixtieth (60th) day
following the Employee's receipt of the distribution from
the other plan, or, if such distribution had previously been
transferred into an individual retirement account or
individual retirement annuity described in Section 408 of
the Code, on or before the sixtieth (60th) day following the
Employee's receipt of the distribution from such account
annuity;
(3) the amount transferred does not exceed the fair market value
of all the property the Employee receives in the
distribution, reduced by the employee contributions (other
than accumulated deductible employee contributions within
the meaning of Section 72(o)(5) of the Code);
(4) the Employee provides the Administrator with whatever
information it deems necessary to determine that the
proposed rollover will meet the requirements of this
Section.
(5) the Employee has not previously requested that the Plan
accept a rollover with respect to amounts received from the
distributing plan.
(b) The Plan Administrator, at the direction of the Board, may permit
the direct transfer of amounts from another plan to this Plan
provided it is established to the satisfaction of the Plan
Administrator that the transferor plan and trust are qualified
under Sections 401(a) and 501(a) of the Code and that transfer of
such amounts to the Plan will not jeopardize the qualified status
of the Plan and Trust under such Code sections.
(c) Amounts that are rolled over or transferred to the Plan shall be
allocated to the Employee's Rollover Account or Prior Plan Account
as appropriate.
3.13 Deductible Voluntary Contributions. Prior to January 1, 1987,
Participants were allowed to make Deductible Voluntary Contributions to
the Plan. Although these contributions were not allowed after December
31, 1986, Deductible Voluntary Contributions made prior to that date
will be maintained in the Plan and will be nonforfeitable at all times.
32
No part of the Deductible Voluntary Contribution Account will be used to
purchase life insurance.
3.14 After-Tax Contributions. Prior to January 1, 1987, Participants were
allowed to make After-Tax Contributions to the Plan. Although these
contributions were not allowed after December 31, 1986, After-Tax
Contributions made prior to that date will be maintained in the Plan and
will be nonforfeitable at all times.
3.15 Contributions During Period of Military Leave.
(a) Notwithstanding any provision of this Plan to the contrary,
contributions, benefits and service credit with respect to
qualified military service will be provided in accordance with
Section 414(u) of the Code. Without regard to any limitations on
contributions set forth in this Article III, a Participant who is
reemployed on or after October 14, 1994 and is credited with
Vesting Service under the provisions of Article V because of a
period of service in the uniformed services of the United States,
may elect to contribute to the Plan the Before-Tax Deposits that
could have been contributed to the Plan in accordance with the
provisions of the Plan had he or she remained continuously
employed by the Employer throughout such period of absence
("make-up contributions"). The amount of make-up contributions
shall be determined on the basis of the Participant's Plan
Compensation in effect immediately prior to the period of absence,
and the terms of the Plan at such time. Any Before-Tax Deposits so
determined shall be limited as provided in Sections 3.01, 3.05,
3.06, 3.07, and 3.08 with respect to the Plan Year or Years to
which such contributions relate rather than the Plan Year in which
payment is made. Any payment to the Plan described in this
paragraph shall be made during the applicable repayment period.
The repayment period shall equal three times the period of
absence, but not longer than five years and shall begin on the
latest of: (i) the Participant's date of reemployment, (ii)
October 13, 1996, or (iii) the date the Employer notifies the
Employee of his or her rights under this Section. Earnings (or
losses) on make-up contributions shall be credited commencing with
the date the make-up contribution is made in accordance with the
provisions of Article IV.
(b) With respect to a Participant who makes the election described in
paragraph (a) above, the Employer shall make Company Matching
Deposits, on the make-up contributions in the amount described in
the provisions of Section 3.01, as in effect for the Plan Year to
which such make-up contributions relate. Company Matching
Deposits, under this paragraph shall be made during the period
described in paragraph (a) above. Earnings (or losses) on Company
Matching Deposits shall be credited commencing with the date the
contributions are made in accordance with the provisions of
Article 4. Any Company Matching Deposits described in Sections
3.01, 3.07 and 3.08 shall be applied with respect to the Plan Year
or Years to which such contributions relate rather than the Plan
Year or Years in which payment is made.
33
(c) All contributions under this Section are considered "annual
additions," as defined in Section 415(c)(2) of the Code, and shall
be limited in accordance with the provisions of Sections 3.03 and
3.04 with respect to the Plan Year or Years to which such
contributions relate rather than the Plan Year in which payment is
made.
34
ARTICLE IV
Participant Accounts and Investment Funds
4.01 Maintenance of Participant Accounts.
(a) A separate Participant Account shall be maintained with respect to
each Participant. Each Participant Account shall hold the net
accumulation of all amounts deposited to the Plan on behalf of a
Participant, along with all investment allocations and net of any
withdrawals, distributions, transfers, expenses, or other charges.
(b) Each Participant Account shall maintain separately the value of
each type of Deposit made on the Participant's behalf. These
accounts shall include:
(1) A Before-Tax Deposit Account shall be maintained for
Before-Tax Deposits and earnings thereon.
(2) An After-Tax Deposit Account shall be maintained for
After-Tax Deposits made prior to 1987 (and earnings thereon)
including After-Tax Deposits made to the Corroon & Black
Employees Savings and Stock Investment Plan.
(3) An Unrestricted Company Matching Deposit Account (prior to
September 1, 2001 the Company Matching Deposit Account)
shall be maintained for the Company Matching Deposits prior
to September 1, 2001 and the earnings thereon.
(4) A Stock-Based Company Matching Deposit Account shall be
maintained for Company Matching Deposits and earnings
thereon, beginning September 1, 2001.
(5) A Rollover Account shall be maintained for Rollover Deposits
and earnings thereon.
(6) A Deductible Contribution Account shall be maintained for
Deductible Contributions made prior to 1987 and earnings
thereon including Deductible Contributions made to the
Corroon & Black Employees Savings and Stock Investment Plan.
(7) A Prior Plan Account shall be maintained for deposits made
to the Plan pursuant to a merger or acquisition and earnings
thereon.
(8) A Predecessor Plan Company Matching Deposit Account shall be
maintained for employer matching deposits previously
contributed to the Corroon & Black Employees Savings and
Stock Investment Plan.
35
(9) A Company Basic Deposit Account shall be maintained for the
Company Basic Deposit and earnings thereon.
(c) Valuation. The values in each Participant Account shall be
determined by the Benefits Committee, as of each Valuation Date,
on the basis of the market values of each Investment Fund as of
the end of such Valuation Date.
The valuation shall reflect the effect on each Account or
subaccount of Deposits, income credited or accrued, realized and
unrealized appreciation or depreciation, distributions,
withdrawals, inter-fund transfers, expenses, and all other
transactions affecting the respective Investment Funds since the
end of the last preceding Valuation Date. All routine Plan
administrative expenses (for such services as account
recordkeeping, required audits, government filings and selection
of investment contracts) as are incurred by the Plan from third
party service providers shall be charged against the Plan
investment earnings before such earnings are distributed to Plan
Participants, or the Company may elect to pay such expenses
directly.
4.02 Investment Funds.
(a) The Company shall determine what investment options to offer under
the Plan and may, from time to time, change the investment options
offered hereunder. Except as otherwise provided below, as of
September 1, 2001, the Investment Funds shall be the following:
MetLife Guaranteed Fixed Income Account PIMCO Total Return Fund
PIMCO High Yield Fund American Century Income and Growth Fund
Harris Associates-Oakmark Fund MetLife Stock Market Index
Guarantee Account Janus Fund Harris Associates-Oakmark Select Fund
Baron Asset Fund Loomis Sayles Small Cap Growth Fund Loomis Sayles
Small Cap Value Fund Templeton Foreign Fund MetLife/UAM Extended
Short-Term TimeStyle Portfolio MetLife/UAM Medium-Term TimeStyle
Portfolio MetLife/UAM Long-Term TimeStyle Portfolio Self-Directed
Brokerage Account Willis Stock Fund (effective September 4, 2001)
(b) As of each Valuation Date, a valuation of each Investment Fund
shall be performed by or at the direction of the Company in order
to determine the value of
36
each Investment Fund and to reconcile the Investment Funds from
the prior Valuation Date.
4.03 Investment of Deposits.
(a) A Participant may direct that any deposits made on his behalf be
allocated to one or more of the Investment Funds described in
Section 4.02(a) in multiples of one percent (1%) of pay.
Deposits will be accepted and allocated to an Investment Fund only
to the extent the Participant has filed an election in accordance
with this Section directing the investment of such Deposits.
Any amounts deposited into the Participant's Accounts and any
interest thereon may be transferred among any of the Investment
Funds in accordance with the limitations set forth in Section
4.04.
(b) Election Forms. Each Participant must make an election directing
the allocation of all of his future deposits in accordance with
subsection (a) prior to the date they are received by the Trust.
Such direction shall continue in effect until such time as the
Participant elects a different allocation.
The investment of future deposits may be changed effective as soon
as administratively feasible after the election has been received
by the Benefits Committee or its delegate. Elections must be made
in accordance with the rules and procedures established by the
Plan Administrator and provided to the Participant prior to his
Entry Date, or with respect to subsequent changes in such rules
and procedures, the effective date of such changes.
(c) Company Matching Deposits. Effective September 1, 2001, all
Company Matching Deposits made on behalf of a Participant shall be
invested solely in the Willis Stock Fund and credited to the
Stock-Based Company Matching Deposit Account.
(d) Notwithstanding any other provision of the Plan, to the extent
that a Participant, because of his position with the Employer, is
restricted by law from trading in Common Stock during specified
periods, such Participant shall not exercise the elections in this
Section in any manner that would violate such restrictions.
4.04 Transfers Between Funds.
(a) Except as provided in subsection (b) below with respect to
transfers of amounts out of a Participant's Stock-Based Company
Matching Deposit Account, a Participant may elect on any day to
transfer amounts from one Investment Fund to another. Transfers
shall be either in increments of one percent (1%) or in a specific
dollar amount.
37
Such election shall be effective as soon as administratively
feasible after the election has been received by the Benefits
Committee or its delegate.
(b) Amounts in a Participant's Stock-Based Company Matching Deposit
Account may not be transferred into any other Investment Fund
prior to the date that a Participant reaches age fifty (50). Any
Participant who has reached age fifty (50) may direct that the
vested portion of such amounts be allocated among any of the
Investment Funds described in Section 4.02(a).
Amounts may be allocated under this subsection (b) in multiples of
one percent (1%) or in a specific dollar amount.
(c) The timing and frequency of transfers among investment options may
be further restricted if such restrictions are required by the
company handling or providing the investment option.
(d) Elections must be made in accordance with the rules and procedures
established by the Plan Administrator and provided to the
Participant.
(e) Notwithstanding any other provision of the Plan, to the extent
that a Participant, because of his position with the Employer, is
restricted by law from trading in Common Stock during specified
periods, such Participant shall not exercise the elections in this
Section in any manner that would violate such restrictions.
4.05 Separation of Forfeitures and Accounts by Employer. Accounts of
Participants employed by a particular Employer shall no longer be
administered separately for the purpose of allocating employer
contributions and forfeitures. Forfeitures of accounts of Participants
shall be used to reduce the subsequent total contributions for all
Employers in accordance with Section 5.02.
38
ARTICLE V
Vesting and Forfeitures
5.01 Nonforfeitable Accounts. A Participant shall have a nonforfeitable right
to the value of his entire Before-Tax Deposit Account, Special Company
Deposit Account, After-Tax Deposit Account, Rollover Account and
Deductible Contribution Account.
5.02 Company Matching Deposits.
(a) Normal Vesting. The Participant's Stock-Based Company Matching
Deposit Account, Unrestricted Company Matching Deposit Account
(prior to September 1, 2001, the Company Matching Deposit
Account), and Predecessor Plan Company Matching Deposit Account
shall be divided into the portion to which the Participant has a
nonforfeitable right and the portion to which he has not acquired
a nonforfeitable right. The portion of such Accounts to which a
Participant has a nonforfeitable right shall be determined by
multiplying the entire value of the Account by the applicable
Vested Percentage. The Vested Percentage of a Participant shall be
in accordance with the following schedule:
Vested Percentage
Completed Years of Applicable to
Service Company Matching Deposits
0-2 0%
3 25%
4 50%
5 or more 100%
A Participant shall have a nonforfeitable right to the balance in
his Prior Plan Account according to the vesting schedule
prescribed by the relevant prior plan.
Provided however, that any person who is a Participant and an
Eligible Employee employed by Management Science Associates, Inc.
on April 1, 1996 shall have a nonforfeitable right to the entire
value of his Company Matching Deposit Account and Predecessor Plan
Company Matching Deposit Account as of that date.
Provided further, that any person who is a Participant and an
Eligible Employee employed by Willis Corroon Corporation of
Sacramento on May 31, 1996 shall have a nonforfeitable right to
the entire value of his Company Matching Deposit Account and
Predecessor Plan Company Matching Deposit Account as of that date.
Provided further, any person listed in Appendix A who was not
offered permanent employment continuing after November 10, 1996
with the Employer in a position
39
comparable to the position the Participant held prior to November
11, 1996 shall have a nonforfeitable right to the entire value of
his Company Matching Deposit Account, Predecessor Plan Company
Matching Deposit Account, and Prior Plan Account as of November
11, 1996.
Provided further, any person listed in Appendix B who was not
offered permanent employment continuing after November 30, 1996
with the Employer in a position comparable to the position the
Participant held prior to December 1, 1996 shall have a
nonforfeitable right to the entire value of his Company Matching
Deposit Account, Predecessor Plan Company Matching Deposit
Account, and Prior Plan Account as of November 30, 1996.
(b) Notwithstanding (a) above, a Participant or an Inactive
Participant shall be fully vested in his Stock-Based Company
Matching Deposit Account, Unrestricted Company Matching Deposit
Account (prior to September 1, 2001, the Company Matching Deposit
Account), Predecessor Plan Company Matching Deposit Account, and
Prior Plan Account upon death, attainment of Normal Retirement
Age, or Disability if such event occurs while he is employed by
the Affiliated Group. Furthermore, the Participant shall be fully
vested upon termination of the Plan or upon the occurrence of
another event described in Section 9.03, if such event occurs
prior to the time the Participant has incurred a forfeiture.
If a Participant separates from service prior to acquiring a
nonforfeitable right to the entire value of his Stock-Based
Company Matching Deposit Account, Unrestricted Company Matching
Deposit Account (prior to September 1, 2001, the Company Matching
Deposit Account), and Predecessor Plan Company Matching Deposit
Account, the nonvested portion of such Account shall be forfeited
upon the earlier to occur of (a) or (b) below where:
(a) is the date on which the Participant receives full payment
of his vested Accrued Benefit upon termination of
participation in the Plan within the meaning of Treasury
Regulation Section 1.411(a)-7(d)(4)(ii), and
(b) is the date on which the Participant incurs five (5)
consecutive one-year Periods of Severance.
Such forfeitures shall be used to reduce subsequent Employer
contributions used for Company Matching Deposits.
5.03 Restoration of Forfeitures.
(a) If a Participant whose entire Stock-Based Company Matching Deposit
Account and Unrestricted Company Matching Deposit Account (prior
to September 1, 2001, the Company Matching Deposit Account) have
been forfeited under Section 5.02 returns to service prior to
incurring a five (5) year Period of Severance, the
40
dollar amount forfeited shall be restored to the Participant's
Company Deposit Account at the time of re-employment.
(b) If a Participant who forfeited a portion of his Stock-Based
Company Matching Deposit Account, Unrestricted Company Matching
Deposit Account (prior to September 1, 2001, the Company Matching
Deposit Account) or Predecessor Plan Company Matching Deposit
Account upon separation from service returns to service prior to
incurring five (5) consecutive one-year Periods of Severance, the
dollar amount forfeited shall be restored to the Participant's
Company Stock-Based Matching Deposit Account, Unrestricted Company
Matching Deposit Account (prior to September 1, 2001, the Company
Matching Deposit Account), and Predecessor Plan Company Matching
Deposit Account if the Participant repays the full amount of any
distribution received upon separation from service before the
earlier of five (5) years after the first date on which he is
subsequently re-employed by the Employer or the close of the first
period of five (5) consecutive one-year Periods of Severance
commencing on the date of the distribution.
(c) The funds for such restoration shall be taken from any available
forfeited amounts at the time the Participant is reemployed or
repays the distribution (as applicable) or, if such forfeited
amounts are insufficient to provide the restoration, shall be
provided by Employer contribution.
5.04 Vesting in Prior Contributions. If a Participant returns to employment
after incurring a five (5) year Period of Severance, his Years of
Service subsequent to such five (5) year period shall not be taken into
account for purposes of determining the Vesting Percentage applicable to
Employer contributions which accrued before such five (5) year period.
5.05 Partial Distribution or Withdrawals. A Participant whose Vesting
Percentage is less than one hundred percent (100%) and who
(a) has received an in-service withdrawal of any portion of his
Stock-Based Company Matching Deposit Account or Unrestricted
Company Matching Deposit Account (prior to September 1, 2001, the
Company Matching Deposit Account) pursuant to Article VII, or
(b) has received a distribution under Article VI and has not repaid
the amount of his distribution as provided under Section 5.03,
shall have the vested portion of the Stock-Based Company Matching
Deposit Account and Unrestricted Company Matching Deposit Account
(prior to September 1, 2001, the Company Matching Deposit Account)
computed by the formula P (A + D) - D, where P equals the Vesting
Percentage at the relevant time, A equals the Company Deposit
Account balance at the relevant time, and D equals the amount of
the previous withdrawal or unrepaid distribution.
41
5.06 Predecessor Employers. Years of Service for a predecessor Employer as
that term is defined in Code Section 414(a)(1) shall be taken into
account for vesting purposes.
5.07 Determination of Vesting. The Plan Administrator shall determine whether
an Employee is fully vested based upon information furnished by the
Employee or Employer, as appropriate. This determination shall be
conclusive and binding on all parties.
42
ARTICLE VI
Distributions
6.01 Events Allowing Distribution. A Participant shall be eligible to receive
a distribution of his vested Accrued Benefit upon retirement, death,
separation from service or Disability; provided, however, that the
eligibility of a Participant to receive a distribution on account of a
separation from service shall be waived if he returns to employment with
an Employer prior to receiving such distribution.
A Participant shall also be eligible to receive a distribution of his
vested Accrued Benefit upon: (a) termination of this Plan without
establishment or maintenance of a successor plan (as described in
Section 401(k)(10) of the Code and the regulations thereunder) or (b)
upon disposition by his Employer of substantially all of the assets
(within the meaning of Section 409(d)(2) of the Code) used by such
Employer in a trade or business or upon the disposition by such Employer
of its interest in a subsidiary (within the meaning of Section 409(d)(3)
of the Code), but only if: (i) the Participant continues employment with
the corporation acquiring such assets or with such subsidiary, as the
case may be; (ii) the acquiring entity is not a member of the Affiliated
Group; and (iii) the acquiring entity does not maintain the Plan. An
event shall not be treated as described in this paragraph with respect
to any Participant unless the Participant receives a lump sum
distribution as described in Section 401(k)(10)(B) of the Code.
Distributions shall be payable as provided in Sections 6.02 and 6.03.
6.02 Form of Distribution.
(a) Subject to the conditions and limitations set forth in other
provisions of this Plan, distributions to or with respect to a
Participant shall be made in one single sum. Provided, however,
that any form of distribution applicable to amounts transferred to
the Plan as provided in Section 3.12(b) shall be preserved with
respect to such amounts to the extent required by law. Provided
further that this Section shall apply to any Participant who
commences receiving a Benefit required under Sections 6.04(b) and
6.05 and who subsequently incurs an event specified in Section
6.01.
Notwithstanding the foregoing, with respect to any distribution
under the Plan which is in the form of an annuity having an
annuity starting date one day later than the earlier of (i) the
ninetieth (90th) day after the Participant receives notice of this
provision in a manner that complies with Department of Labor
Regulation Section 29 CFR 2520.104b-3 and (ii) January 1, 2003
(the first day of the second plan year following the plan year in
which this provision became effective (September 1, 2001), such
distribution from the Plan shall instead be made solely in the
form of a single lump sum distribution, so long as such single
lump sum
43
distribution is otherwise identical to the optional form of
benefit that would have been available to the Participant before
the application of this paragraph.
(b) In the event a Participant elects or is required to receive a
total distribution of his vested Accrued Benefit, the Participant
can elect to receive the distribution of the vested portion of his
Willis Stock Fund in kind. The value of the Participant's vested
Accrued Benefit invested in the Stock Fund shall be determined to
be the Market Value of the shares held for the Participant in such
Fund as of the applicable Valuation Date. Such distribution shall
be in full shares to the extent possible plus the cash proceeds of
the sale of any fractional shares. In any such case, the
distribution of other amounts hereunder shall be paid in cash.
In the event that the Participant does not elect an "in kind
distribution" pursuant to the previous paragraph, the Participant
shall receive his distribution from the Plan totally in cash. The
Participant shall make such election by specifying in writing that
he desires either an "in kind distribution" or a "cash-only
distribution" on such form or forms as the Benefits Committee
deems appropriate for such election. For the purpose of this
"cash-only distribution", the value of the Participant's Common
Stock accumulated in the Participant's Accounts shall be equal to
the actual proceeds from the sale of such Common Stock. For the
purpose of this subsection, any transfer of shares by the Trustee
from the account of the Participant receiving a distribution to
another Account shall be considered a "sale" and the Market Value
on the date of such transfer shall be considered "proceeds"
hereunder.
(c) If a Participant dies while legally married prior to the
distribution of his Participant Account, the value of such
Account, determined under 6.03 below reduced by the balance of any
loan outstanding to the Participant from the Plan and secured by
the Participant's account, shall be distributed by payment in a
single sum to the Participant's surviving spouse unless the
Participant and his surviving spouse had made a Qualified Election
prior to his death. If a Qualified Election had been made, payment
shall be made in a single sum to or for the benefit of the
Participant's Beneficiary or Beneficiaries.
If a Qualified Election had not been made prior to the
Participant's death, the Participant's surviving spouse may elect
to defer distribution of the Participant's Account until a date
which is no later than the date which would have been the
Participant's Normal Retirement Date.
A Qualified Election means an election made by the Participant
providing that the balance of the Participant's Accounts will not
be distributed in full to the surviving spouse, and
(1) the spouse of the Participant consents in writing to such
election and to the designation of the alternate Beneficiary
and acknowledges the effect of
44
such election on forms provided by and filed with the
Benefits Committee and witnessed by a Plan representative or
a notary public; or
(2) it is established that the Participant has no spouse or that
such spouse cannot be located, or under such other
circumstances as may be provided by the Code or applicable
regulations thereunder.
Any consent by a spouse pursuant to this paragraph shall be
effective only with respect to such spouse. Spousal consent
is irrevocable unless the Participant revokes his Qualified
Election in order to designate another Beneficiary who is
other than the Participant's spouse. In such case, a new
Qualified Election must be made in accordance with this
paragraph.
6.03 Amount and Timing of Distributions
(a) A Participant eligible to receive a distribution in accordance
with Section 6.01 shall be entitled to receive the value of his
vested Accrued Benefit as of the Valuation Date specified in
subsection 6.03(b) reduced by the balance of any loan outstanding
to the Participant from the Plan and secured by the Participant's
account. Provided, however, that the value of the Participant's
vested Accrued Benefit invested in the Willis Stock Fund shall be
determined as provided in Section 6.02(b). Such distribution shall
be made as soon as administratively feasible after an event
described in Section 6.01 has occurred. If the vested Accrued
Benefit is zero, the Participant shall be deemed to have received
a distribution of such benefit on the date of employment
termination. Notwithstanding anything in this Section to the
contrary, if the value of the Participant's vested Accrued Benefit
exceeds the amount prescribed in Section 411(a)(11)(A) of the Code
(five thousand dollars ($5,000) effective January 1, 1998) at the
time of this distribution (or, prior to January 1, 1999, at the
time of any prior distribution), no distribution shall be made
hereunder prior to the Participant's Normal Retirement Date
without the consent of the Participant. In the event the
Participant does not consent to such distribution, the Benefits
Committee shall cause the Trustee to distribute his vested Accrued
Benefit to the Participant or his Beneficiary, as the case may be,
in accordance with this Article VI within a reasonable period
following the earliest of (i) the last day of the Plan Year in
which the Participant attains his Normal Retirement Age; (ii) the
last day of the Plan Year in which the Participant dies; or (iii)
the date on which the Participant files an election with the Plan
Administrator to have his entire vested Accrued Benefit
distributed to him. Such distribution shall be in the form of a
single sum benefit and shall be valued as of the Valuation Date
coinciding with the date of distribution.
(b) The Valuation Date specified in this subsection means:
(1) For any Participant whose vested Accrued Benefit does not
exceed the amount prescribed in Section 411(a)(11)(A) of the
Code (five thousand
45
dollars ($5,000) effective January 1, 1998) at the time of
this distribution (or, prior to January 1, 1999, at the time
of any prior distribution), or who has reached his Normal
Retirement Date before the occurrence of an event described
in Section 6.01, the Valuation Date that occurs as soon
after the Employer notifies the Plan Administrator that an
event described in Section 6.01 has occurred as is
administratively feasible to allow the Employer to process
the distribution or
(2) For any Participant not described in subsection (1), the
Valuation Date that occurs as soon after the date on which
the Participant files an election with the Plan
Administrator to have his entire vested Accrued Benefit
distributed to him as is administratively feasible to allow
the Employer to process the distribution, but no later than
the Valuation Date following his Normal Retirement Date.
6.04 Commencement of Benefits.
(a) Unless the Participant elects otherwise in writing pursuant to a
provision of this Plan in effect on the date of such election, the
payment of Benefits under the Plan to a Participant shall commence
no later than the sixtieth (60th) day after the close of the Plan
Year in which the last of the following occurs:
(1) The Participant attains age sixty-five (65);
(2) The tenth (10th) anniversary of the Participant's initial
participation in the Plan occurs; or
(3) The Participant terminates service with any member of the
Affiliated Group.
(b) Effective January 1, 1997, with respect to a five percent (5%)
owner, distribution of benefits shall commence not later than
April 1 of the calendar year following the calendar year in which
the Participant attains age seventy and one-half (70 1/2). Also
effective January 1, 1997, a Participant who is not a five percent
(5%) owner shall commence receipt of benefits not later than April
1 of the calendar year following the calendar year in which the
Participant reaches age seventy and one-half or retires, if later.
Notwithstanding the above, a Participant who commenced minimum
distributions under Code Section 401(a)(9) prior to January 1,
1997, and who does not elect a complete distribution of his
Account under Section 7.04, shall continue to receive minimum
distributions in accordance with the Plan as in effect on December
31, 1996.
6.05 Methods of Distribution. Effective January 1, 1997, all distributions
required under this Section shall be determined and made in accordance
with the regulations under Section 401(a)(9) of the Code as in effect on
January 1, 1997 or as hereafter amended and the
46
regulations thereunder, including the minimum distribution incidental
benefit requirement of Proposed Treasury Regulation Section
1.401(a)(9)-2.
With respect to distributions under the Plan made in calendar years
beginning on or after January 1, 2001, the Plan will apply the minimum
distribution requirements of Section 401(a)(9) of the Code in accordance
with the regulations under Section 401(a)(9) of the Code that were
proposed on January 17, 2001, notwithstanding any provision of the Plan
to the contrary (Proposed Reg. Section 1.401(a)(9)-0 through Proposed
Reg. 1.401(a)(9)-8). This amendment shall continue in effect until the
end of the last calendar year beginning before the effective date of
final regulations under section 401(a)(9) of the Code or such other date
specified in guidance published by the Internal Revenue Service.
6.06 Distributions Pursuant to a Qualified Domestic Relations Order.
Distribution of benefits to an alternate payee under a qualified
domestic relations order meeting the requirements of Section 414(p) of
the Code shall be made in a single sum to such alternate payee, unless
such alternate payee elects otherwise in accordance with a form of
payment permitted under the terms of this Article VI. Such payment shall
be made on a date specified in the qualified domestic relations order,
which date may precede the time the Participant would be eligible to
receive a distribution under the terms of the Plan.
6.07 Direct Rollover Distributions.
(a) Direct Rollover Election. Notwithstanding any provision of the
Plan to the contrary that would otherwise limit a Distributee's
election under this Section, a Distributee may elect at the time
and in the manner prescribed by the Plan Administrator, to have
any portion of an Eligible Rollover Distribution to which he is
otherwise entitled, paid directly to an Eligible Retirement Plan
specified by the Distributee in a direct rollover.
(b) Definitions.
(1) "Eligible Rollover Distribution" means any distribution of
all or any portion of the balance to the credit of the
Distributee, except that an Eligible Rollover Distribution
does not include: any distribution that is one of a series
of substantially equal periodic payments (not less
frequently than annually) made for the life (or life
expectancy) of the Distributee or the joint lives (or joint
life expectancies) of the Distributee and the Distributee's
designated Beneficiary, or for a specified period of ten
(10) years or more; 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). Effective for Plan Years beginning on
or after January 1, 2000, Eligible Rollover Distribution
does not include any hardship distribution described in Code
Section 401(k)(2)(B)(i)(IV).
47
(2) "Eligible Retirement Plan" means an individual retirement
account described in Section 408(a) of the Code, an
individual retirement annuity described in Section 408(b) of
the Code, an annuity plan described in Section 403(a) of the
Code, or a qualified trust described in Section 401(a) of
the Code, that accepts the Distributee's Eligible Rollover
Distribution. However, in the case of an Eligible Rollover
Distribution to the surviving Spouse, an Eligible Retirement
Plan is an individual retirement account or individual
retirement annuity.
(3) "Distributee" means an Employee or former Employee. In
addition, the Employee's or former Employee's surviving
Spouse and the Employee's or former Employee's Spouse or
former Spouse who is the alternate payee under a qualified
domestic relations order, as defined in Section 414(p) of
the Code, are Distributees with regard to the interest of
the Spouse or former Spouse.
(4) "Direct Rollover" means a payment by the Plan to the
Eligible Retirement Plan specified by the Distributee.
48
ARTICLE VII
In-Service Withdrawals
7.01 Hardship Withdrawals.
(a) Hardship defined. A Participant may request a withdrawal of a lump
sum amount from his Before-Tax Deposit Account and from the vested
portion of his Unrestricted Company Matching Deposit Account
(prior to September 1, 2001, the Company Matching Deposit Account)
and under certain circumstances his Stock-Based Company Matching
Deposit Account in the event of immediate and heavy financial
need. Such request shall be made in accordance with procedures
established by the Benefits Committee. Immediate and heavy
financial need shall include any of the following occurrences:
(1) Unreimbursed medical expenses (as defined in Code Section
213(d)) and amounts necessary to obtain medical care for the
Participant, the Participant's spouse or any dependent.
(2) Purchase of the Participant's principal residence (but not
ongoing mortgage payments).
(3) Payment of tuition, related educational fees, and room and
board expenses, for the immediately forthcoming twelve (12)
month period of post-secondary education for the
Participant, his spouse or dependents (as defined in Code
Section 152).
(4) Payment to prevent eviction from or foreclosure on a
Participant's principal residence.
For the purposes of this Section, dependents shall be those
persons considered to be dependents for the purposes of Section
152 of the Code.
(b) Availability of Hardship Withdrawals. The Benefits Committee will
approve a request for a hardship withdrawal only if each of the
following conditions are met:
(1) The distribution is not in excess of that which is required
to meet the immediate and heavy financial need of the
Participant, including any amounts necessary to pay any
federal, state, or local income taxes or penalties
reasonably anticipated to result from the distribution.
(2) The Participant has obtained all distributions (other than
hardship withdrawals) and nontaxable plan loans available
from the Plan or from any other qualified and nonqualified
plan sponsored by the Employer.
49
(3) The Participant suspends all elective contributions (within
the meaning of Treasury Regulation Section 1.401(k)-1(g)(4))
and employee contributions (within the meaning of Treasury
Regulation Section 1.401(k)-1(a)(2)(ii)) to all plans
sponsored by the Employer for the twelve (12) consecutive
month period commencing on the date of the hardship
distribution.
(4) The Plan, and all other plans maintained by the Employer,
reduce the aggregate limit on elective deferrals (as
specified under Section 402(g) of the Code) for the
Participant's taxable year immediately following the year in
which the hardship distribution occurs by the amount of
elective contributions (within the meaning of Treasury
Regulation Section 1.401(k)-1(g)(3)) made on behalf of the
Participant during the taxable year in which the hardship
withdrawal occurs.
(c) Amounts Available for Hardship Withdrawal. A Participant may
withdraw on account of hardship an amount equal to his
Before Tax Deposits, including earnings credited to such
Deposits as of December 31, 1988, as well as the vested
portion of his Unrestricted Company Matching Deposit Account
(prior to September 1, 2001, the Company Matching Deposit
Account) and, after age fifty (50), his Stock-Based Company
Matching Deposit Account.
Qualified Matching Contributions, Qualified Non-elective
Contributions and income credited on Before-Tax Deposits
after December 31, 1988 shall not be available for hardship
withdrawal.
Withdrawals under this Section will be made available as
soon as administratively feasible after a request has been
received by the Benefits Committee or its delegate and
approved for payment. The value of accounts will be
determined as of the Valuation Date preceding the date the
withdrawal is paid.
Notwithstanding any other provision of this plan, hardship
withdrawals are not available with respect to contributions
made with respect to Contribution Periods during which the
Participant is compensated for services rendered in the
United Kingdom.
7.02 Withdrawals After Age 59 1/2. A Participant who has attained age
fifty-nine and one-half (59 1/2) may request a withdrawal in a lump sum
of all or any part of the value of his Participant Account attributable
to Before Tax Deposits, vested Stock-Based Company Matching Deposits,
vested Unrestricted Company Matching Deposits, and Special Basic Deposit
Account; provided, however, that in no event may a Participant have more
than one (1) withdrawal in any calendar year.
Withdrawals under this Section will be made available as soon as
administratively feasible after a request has been received by the
Benefits Committee or its delegate and approved for payment. The value
of accounts will be determined as of the Valuation Date preceding the
date the withdrawal is paid.
50
Notwithstanding any other provision of this plan, age 59 1/2 withdrawals
are not available with respect to contributions made with respect to
Contribution Periods during which the Participant is compensated for
services rendered in the United Kingdom.
7.03 Withdrawal of Other Contributions. Once each year, a Participant may
request a withdrawal of any amount from his After-Tax Deposit Account,
Rollover Account, Predecessor Plan Company Matching Deposit Account,
Deductible Contribution Account or, subject to the following paragraph,
his Prior Plan Account; provided, however, that in no event may a
Participant have more than one (1) withdrawal in any calendar year.
Withdrawals from a Prior Plan Account shall be permitted only to the
extent such withdrawal would have been permitted under the plan from
which such amounts were transferred.
Withdrawals under this Section will be made available as soon as
administratively feasible after a request has been received by the
Benefits Committee or its delegate and approved for payment. The value
of accounts will be determined as of the Valuation Date preceding the
date the withdrawal is paid.
Notwithstanding any other provision of this plan, withdrawals under this
Section are not available with respect to contributions made with
respect to Contribution Periods during which the Participant is
compensated for services rendered in the United Kingdom.
7.04 Withdrawals After Age 65. A Participant who has attained age sixty-five
(65) may request a withdrawal in a lump sum of all or any part of the
value of his Participant Account. However, in no event may a Participant
have more than one (1) withdrawal in any calendar year.
Withdrawals under this Section will be made available as soon as
administratively feasible after a request has been received by the
Benefits Committee or its delegate and approved for payment. The value
of accounts will be determined as of the Valuation Date preceding the
date the withdrawal is paid.
Notwithstanding any other provision of this plan, withdrawals under this
Section are not available with respect to contributions made with
respect to Contribution Periods during which the Participant is
compensated for services rendered in the United Kingdom.
7.05 Loans to Participants. An Active Participant or any party in interest
who is an Inactive Participant, a Beneficiary or, to the extent provided
in a qualified domestic relations order, an alternate payee, may apply
for a loan from his vested Accrued Benefit by filing an application with
the Plan Administrator who shall determine whether a loan will be
granted. Loans that are granted shall be subject to the following
conditions:
(a) A Participant's loan, when added to the balance of any other
outstanding loans the Participant may have, shall not exceed the
lesser of:
51
(1) Fifty thousand dollars ($50,000) reduced by the excess of
(1) the highest outstanding loan balance of the
Participant's loans outstanding during the immediately prior
twelve (12) month period (ending the day before the new loan
is granted) over (2) the total of all outstanding loans the
day the new loan is granted or
(2) Fifty percent (50%) of the Participant's vested Accrued
Benefit or
(3) Prior to age fifty (50), the balance of the Participant's
Accounts other than the Stock-Based Company Matching Deposit
Account.
For purposes of this Section, the Participant's vested
Accrued Benefit shall be determined as of the Valuation Date
preceding the date of the loan. However, under no
circumstances may the loan amount exceed the Participant's
vested Accrued Benefit as of the date the loan is disbursed.
(b) Each loan shall be secured by the Participant's vested Accrued
Benefit or by such other security as the Plan Administrator may
deem to be adequate. Provided, however, that in no event may more
than fifty percent (50%) of the Participant's vested Accrued
Benefit be used as security for loans made under this Section.
(c) All loans shall become due and payable upon the earlier of
termination of employment or the expiration of five (5) years from
the date of the loan, except that the five (5) year repayment
period shall be extended for a period of up to fifteen (15) years
for any loan used for the purpose of purchasing a Participant's
principal residence.
(d) If the Plan provides for Investment Funds, each loan shall be made
from and repaid to the subaccounts under the various Investment
Fund(s) in accordance with procedures established by the Plan
Administrator.
(e) Repayment of loans shall be by payroll deduction, or other
approved method, on a level amortization basis; provided, however,
that a Participant may prepay the outstanding principal balance of
his loan at any time.
(f) In the event of default, foreclosure on the note and attachment of
security shall not take place until the occurrence of a
distributable event under the Plan. No distribution shall be made
to any Participant or to a Beneficiary of any Participant until
all outstanding loans to such Participant, including interest
accrued thereon, have been liquidated.
(g) The Plan Administrator shall set loan interest rates in accordance
with regulations issued by the Department of Labor.
52
(h) The Plan Administrator may establish such other procedures or
rules as may be reasonable, necessary or desirable to administer
this loan program in compliance with all applicable law.
(i) Notwithstanding any other provision of this plan, loans are not
available with respect to contributions made with respect to
Contribution Periods during which the Participant is compensated
for services rendered in the United Kingdom.
7.06 Procedure for Withdrawals. Withdrawal requests and loan applications
shall be made pursuant to the rules and procedures established by the
Plan Administrator and provided to the Participant upon request.
53
ARTICLE VIII
Plan Administration
8.01 Plan Administration. The Board shall appoint a Benefits Committee to
serve as the Plan Administrator. The Benefits Committee shall be the
named fiduciary having the authority to control and manage the operation
and administration of the Plan.
8.02 Appointment, Removal or Resignation of Benefits Committee Members. The
Board shall appoint the members of the Benefits Committee, which shall
consist of not less than three (3) or more than five (5) persons. Any
member of the Benefits Committee may resign or be removed by the Board
at any time, at which time the Board may appoint new members. Acceptance
of appointment to the Benefits Committee or resignation from the
Benefits Committee must be made in writing to the Board.
8.03 Conduct of Committee Business. The Benefits Committee shall select a
chairman and may select a secretary (who may, but need not, be a member
of the Benefits Committee). A majority of the members of the Benefits
Committee at the time in office shall constitute a quorum for the
transaction of the business at any meeting. Any determination or action
of the Benefits Committee may be made or taken by a majority of the
members present at any meeting, or without a meeting by a resolution or
written memorandum concurred in by a majority of the members then in
office.
8.04 Responsibilities of the Benefits Committee. The Benefits Committee shall
have the power and the duty to take all action and to make all decisions
necessary or proper to carry out the Plan. Any discretionary actions to
be taken under the Plan by the Benefits Committee with respect to the
classification of Employees, Participants, joint or contingent
annuitants, beneficiaries, contributions, or benefits shall be uniform
in their nature and applicable to all persons similarly situated. The
powers and duties of the Benefits Committee shall include, but shall not
be limited to, the following:
(a) To require any person to furnish such information as it may
request for the purpose of the proper administration of the Plan
as a condition to receiving any benefits under the Plan;
(b) To make and enforce such rules and regulations and prescribe the
use of such forms as it shall deem necessary for the efficient
administration of the Plan;
(c) To, in its discretion, interpret all Plan provisions and to
determine all questions arising under the Plan, including the
power to determine the eligibility of Employees, Participants and
all other persons to participate in the Plan or to receive
benefits under the Plan and to determine the amount of benefits
payable under the Plan to any person and to remedy ambiguities,
inconsistencies or omissions;
54
(d) To decide on questions concerning the Plan and the eligibility of
an Employee to participate in the Plan, in accordance with the
provisions of the Plan;
(e) To determine the amount of benefits which shall be payable to any
person in accordance with the provisions of the Plan; and to
provide a full and fair review to any Participant whose claim for
benefits has been denied in whole or in part;
(f) To prepare and distribute information explaining the Plan in such
manner as the Committee determines to be appropriate;
(g) To allocate any such powers and duties to or among individual
members of the Benefits Committee;
(h) To designate persons other than Benefits Committee members to
carry out any duty or power which would otherwise be a fiduciary
responsibility of the Benefits Committee, under the terms of the
Plan;
(i) Subject to the provisions of the Trust Agreement and any group
annuity contract, to determine the manner in which the funds of
the Plan shall be disbursed pursuant to the Plan;
(j) To adopt interest rates and mortality and other tables to be used
in all actuarial calculation required for administration of the
Plan; and
(k) To establish procedures to ensure that no Participant who is
subject to Section 16 of the Securities Exchange Act of 1934, as
amended from time to time, purchases or sells or otherwise
acquires or disposes of any Common Stock held on his or her behalf
in any Accounts in contravention of any applicable securities laws
or the Company's trading window policy, and shall designate
certain persons to monitor the mechanics of the procedures in
order to satisfy the duties of the Benefits Committee set forth in
this subsection (k).
8.05 Administrative and Professional Assistance. The Benefits Committee may
employ counsel, accountants, agents and such clerical or other services
as it may require in carrying out the provisions of the Plan or in
complying with the requirements imposed by ERISA.
8.06 Delegation and Reliance. To the extent permitted by law, the Benefits
Committee and any person to whom they may delegate any duty or power in
connection with administering the Plan, the Employer, and the officers
and directors thereof, shall be entitled to rely conclusively upon, and
shall be fully protected in any action taken or suffered by them in good
faith in the reliance upon, any actuary, counsel, accountant, other
specialist, or other person selected by the Company, or in reliance upon
any tables, valuations, certificates, opinions or reports which shall be
furnished by any of them or by the Insurance company. Further, to the
extent permitted by law, neither the Company nor any Employer, nor the
officers or directors thereof, nor the Benefits Committee, nor members
thereof, shall be
55
liable for any neglect, omission or wrongdoing of a Trustee, Insurance
company, Investment Manager, or any other person or fiduciary.
8.07 Expenses of the Plan. The members of the Benefits Committee shall serve
without compensation for their services. If appointed separately, the
Plan Administrator may be compensated for his services. Administrative
expenses of the Plan, such as actuarial, consulting and legal services,
shall be paid directly by the Trust Fund to the extent such payments are
permitted by law. Such expenses may, however, in the discretion of the
Employer, be paid directly by the Employer.
8.08 Claims Procedure. The claims procedure hereunder shall be as provided
herein:
(a) Claim. A Participant or Beneficiary or other person who believes
that he is being denied a benefit to which he is entitled
(hereinafter referred to as "Claimant") may file a written request
for such benefit with the Benefits Committee setting forth his
claim. The request must be addressed to the Benefits Committee at
the corporate office.
(b) Claim Decision. The Benefits Committee shall respond within ninety
(90) days of receipt of the claim. However, the Benefits Committee
may extend the reply period, upon written notification to the
Claimant, for an additional ninety (90) days for reasonable cause.
If the claim is denied in whole or in part, the Benefits Committee
shall adopt a written opinion using nontechnical language
calculated to be understood by the Participant setting forth:
(1) the specific reason or reasons for denial;
(2) the specific references to pertinent Plan provisions on
which the denial is based;
(3) a description of any additional material or information
necessary for the Claimant to perfect the claim and an
explanation of why such material or such information is
necessary;
(4) appropriate information as to the steps to be taken if the
Claimant wishes to submit the claim for review; and
(5) the time limits for requesting a review.
(c) Request for Review. Within sixty (60) days after the receipt by
the Claimant of the written opinion described above, the Claimant
may request in writing that the Benefits Committee review its
determination. Such request shall be addressed to the Benefits
Committee.
The Claimant or his duly authorized representative may review the
pertinent documents and submit issues and comments in writing for
consideration by the
56
Benefits Committee. If the Claimant does not request a review of
the Plan Administrator's determination within such sixty- (60) day
period, he shall be barred and stopped from challenging the Plan
Administrator's determination.
(d) Review and Decision. The Benefits Committee shall review its
determination within sixty (60) days after receipt of a Claimant's
request for review; provided, however, that for reasonable cause
such period may be extended to no more than one hundred twenty
(120) days. After considering all materials presented by the
Claimant, the Benefits Committee will render a written opinion,
written in a manner calculated to be understood by the Claimant
setting forth the specific reasons for the decision and containing
specific references to the pertinent Plan provisions on which the
decision is based.
8.09 Plan Administrator's Decision Final. Subject to applicable law, any
interpretation of the provisions of the Plan and any decision on any
matter within the discretion of the Plan Administrator made by the Plan
Administrator in good faith shall be binding on all persons. A
misstatement or other mistake of fact shall be corrected when it becomes
known and the Plan Administrator shall make such adjustment on account
thereof as it considers equitable and practicable.
8.10 Standard of Review. The Plan Administrator shall perform its duties as
the Plan Administrator and in its sole discretion shall determine
appropriate courses of action in light of the reason and purpose for
which this Plan is established and maintained. In particular, the Plan
Administrator shall interpret all Plan provisions, and make all
determinations as to whether any Participant or Beneficiary is entitled
to receive any benefit under the terms of this Plan which interpretation
shall be made by the Plan Administrator in its sole discretion. Any
construction of the terms of the Plan that is adopted by the Plan
Administrator and for which there is a rational basis shall be final and
legally binding on all parties.
Any interpretation of the Plan or other action of the Plan Administrator
shall be subject to review only if such interpretation or other action
is without rational basis. Any review of a final decision or action of
the Plan Administrator shall be based only on such evidence presented to
or considered by the Plan Administrator at the time it made the decision
that is the subject of review. If any participating Employer and/or any
Eligible Employee who performs services for a participating Employer
that is or may be compensated for in part by benefits payable pursuant
to this Plan, such an individual shall be treated as agreeing with and
consenting to any decision that the Plan Administrator makes in its sole
discretion and further agrees to the limited standard of review
described by this Section 8.10 by the acceptance of such benefits.
8.11 Information Required by Plan Administrator. Each person entitled to
benefits under the Plan must file his most recent post office address
with the Plan Administrator. Any communication, statement or notice
addressed to any such person at the last post office address filed with
the Plan Administrator will be binding upon such person for all purposes
of the Plan. Each person entitled to benefits under the Plan also shall
furnish
57
the Plan Administrator with such documents or information as the Plan
Administrator considers necessary or desirable for the purpose of
administering the Plan. The Employer shall furnish the Plan Administrator with
such data and information as the Plan Administrator may deem necessary or
desirable in order to administer the Plan. The records of any Employer with
respect to periods of employment, termination of employment and the reason
therefor, leave of absence, re-employment and earnings will be conclusive on
all persons unless determined by the Plan Administrator to be incorrect.
58
ARTICLE IX
Amendment and Termination
9.01 Amendment. Except as provided herein, the Board reserves the right to
amend or terminate this Plan at any time and in any manner. The Board
may delegate this authority to any officer(s) of the Company. Any action
by the Board shall be evidenced by a valid resolution. Any action by any
officer(s) shall be evidenced by a valid officer's certificate. The
resolutions and officer's certificates shall be attached to this Plan
and considered a part hereof. Any modification or amendment shall
satisfy the following rules:
(a) The duties and liabilities of the Trustee under the Plan cannot be
changed substantively without its consent.
(b) No amendment shall reduce the amount of a Participant's account
balance or eliminate an optional form of distribution except to
the extent permitted under Section 412(c)(8) of the Code or other
applicable Treasury Regulations.
(c) No merger or consolidation with, or transfer of assets or
liabilities to any other plan shall be made unless each
Participant and each other person entitled to benefits under the
Plan shall be entitled to a benefit immediately after such merger,
consolidation or transfer (if the plan into which such persons
were merged, etc., then terminated) which is equal to or greater
than the benefit such persons would have been entitled to receive
immediately before the merger, consolidation or transfer (if the
plan from which such persons were merged, etc. had then
terminated).
(d) Under no condition shall any amendment result in the return or
repayment to any Employer of any part of the Trust Fund or the
income therefrom, or result in the distribution of the Trust Fund
for the benefit of anyone other than Participants and any other
persons entitled to benefits under the Plan.
(e) No modification or amendment of the Plan shall be made
retroactively unless deemed by the Company to be necessary or
appropriate to conform the Plan to or to satisfy the conditions of
any law, governmental regulation or ruling or to permit the Plan
and the Trust to meet the requirements of Sections 401, 404 and
501 of the Code, or the corresponding provisions of any subsequent
law.
(f) If the Plan's vesting schedule is changed as a result of an
amendment, each Participant who has completed at least three (3)
Years of Service may elect to continue to have his vested
percentage computed in accordance with the vesting schedule in
effect for that Participant prior to the amendment. This election
may be made no earlier than the date the amendment is adopted and
no later than the latest of the date that is sixty (60) days after
the date: (i) the amendment is
59
adopted; (ii) the amendment becomes effective; or (iii) the
Participant is issued a written notice of the amendment by the
Employer or Plan Administrator.
9.02 Termination. Although it is the intention of the Employer that this Plan
shall be continued and that contributions to it will be made regularly,
this Plan is entirely voluntary on the part of the Employer, and the
continuance of the Plan and the payments thereunder are not assumed as a
contractual obligation of the Employer. The Employer specifically
reserves the right, in its sole and uncontrolled discretion and by its
official and authorized act, to modify, to suspend (in whole or in part)
or to discontinue at any time its contributions to this Plan. The Plan
will terminate as to all Employers on any date specified by the Board,
provided written notice of the termination is given to the Benefits
Committee, the Trustee and the other Employers. The Plan will terminate
as to an individual Employer on the first to occur of the following:
(a) the date it is terminated by that Employer through action taken by
its Board of Directors;
(b) the date the Employer is judicially declared bankrupt or
insolvent;
(c) the dissolution, merger, consolidation or reorganization of that
Employer, the sale of a majority of the voting shares of that
Employer by the Company, or the sale by that Employer of all or
substantially all of its assets, except that:
(1) in any such event arrangements may be made with the consent
of the Board whereby the Plan will be continued by any
successor to that Employer or any purchaser of all or
substantially all of its assets, in which case the successor
or purchaser will be substituted for that Employer under the
Plan; and the Trust Agreement; and
(2) if an Employer is merged, dissolved or in any way
reorganized into, or consolidated with, any other Employer,
the Plan as applied to the former Employer will
automatically continue in effect without a termination
thereof.
9.03 Nonforfeitability on Termination, Partial Termination or Discontinuance
of Contributions. If there is a termination or partial termination of
the Plan with respect to any Employer, or a complete discontinuance of
contributions to the Plan by such Employer, the rights of all affected
Participants to benefits accrued to the date of such event shall be
nonforfeitable.
9.04 Allocation and Distribution of Assets on Termination. On termination of
the Plan with respect to any Employer, the Benefits Committee will
direct the allocation and distribution of Plan assets allocable to
Participants employed by that Employer and other persons entitled to
benefits under the Plan. Such allocation and distribution will be made
only after payment of or provision for all expenses and charges of
administration applicable to the Plan, and after appropriate adjustment
of the Accounts of Participants as
60
of the date of termination in the manner described in Section 4.01. Each
affected Participant will receive a distribution equal to the value of
his respective Participant Accounts on the termination date.
9.05 Termination of Plan With Respect to an Adopting Company. Each Adopting
Company reserves the right to terminate the Plan at any time with
respect to employees of the Adopting Company by action of its Board of
Directors. The Adopting Company shall also have the right to suspend
contributions to the Plan at any time.
In the event of termination of the Plan only with respect to the
Employees of the Adopting Company, the Benefits Committee shall direct
that the portion of the Fund attributable to Employees of the Adopting
Company be segregated by the Trustee into a separate fund.
The portion of the Fund which is so segregated shall be retained in a
separate trust fund and applied in one of the following methods, at the
discretion of the Benefits Committee:
(a) If the Adopting Company shall demonstrate conclusively, within the
one-hundred eighty (180) day period immediately following
termination of the Plan with respect to its Employees, that it has
established a successor retirement plan and trust for the benefit
of its Employees which is qualified under Section 401(a) of the
Code, such assets shall be transferred to the successor trustee.
(b) If the Adopting Company shall fail, within the one-hundred eight
(180) day period immediately following termination of the Plan
with respect to its Employees, to establish a successor retirement
plan and trust which is qualified under Section 401(a) of the
Code, such assets shall be distributed for the benefit of the
Employees of the Adopting Company in accordance with the method
described in Section 11.07 hereof.
61
ARTICLE X
General Provisions
10.01 Fiduciaries. The Company and the Trustee shall be the named fiduciaries
under this Plan and shall exercise their duties hereunder in accordance
with the requirements of Part 4 of Title I of the Employee Retirement
Income Security Act of 1974. No "fiduciary" under the Plan or the Trust
Agreement shall be liable for an act or omission of another person in
carrying out any fiduciary responsibility where such fiduciary
responsibility is allocated to such other person by the Plan or the
Trust Agreement except to the extent that such fiduciary is in violation
of his duty under Section 405(a) or 405(c)(2) of ERISA.
The Company shall have exclusive responsibility for the specific matters
delegated to it by the Plan. The Trustee shall have responsibility for
management and control of the assets of the Plan as provided in the
Trust Agreement.
10.02 Non-Alienation.
(a) Protected Benefits. None of the benefits under the Plan are
subject to the claims of creditors of Participants or their
Beneficiaries, and none will be subject to attachment, garnishment
or any other legal process. Neither a Participant nor his
Beneficiary may assign, sell, borrow on, or otherwise encumber any
of his beneficial interest in the Plan and Trust Fund, nor shall
any such benefits be in any manner liable for or subject to the
deeds, contracts, liabilities, engagements or torts of any
Participant or Beneficiary. If any such Participant or Beneficiary
shall become bankrupt or attempt to anticipate, sell, alienate,
transfer, pledge, assign, encumber or change any benefit
specifically provided for herein, or if a court of competent
jurisdiction enters an order purporting to subject such interest
to the claim of any creditor, then the Trustee shall hold or apply
such benefit to or for the benefit of such Participant or
Beneficiary in such manner as the Trustee may deem proper. The
foregoing shall not apply to judgments, orders and decrees issued
after, and settlement agreements entered into on or after, August
5, 1997 to the extent permitted by Code Section 401(a)(13)(C) and
(D).
(b) Qualified Domestic Relations Order. The foregoing Section 10.03(a)
shall also apply to the creation, assignment or recognition of a
right under a domestic relations order, unless such order is
determined to be a qualified domestic relations order as defined
in Section 414(p) of the Code (and those other domestic relations
orders permitted to be so treated by the Committee under the
provisions of the Retirement Equity Act of 1984).
The Committee shall establish a written procedure to determine the
qualified status of domestic relations orders and to administer
distributions under such qualified orders.
62
10.03 Facility of Payment. In making any distribution to or for the benefit of
any minor or incompetent Participant or Beneficiary, or any other
Beneficiary, who, in the opinion of the Benefits Committee, is incapable
of properly using, expending, investing or otherwise disposing of such
distribution, then the Benefits Committee may, but need not, order the
Trustee to make such distribution to a legal or natural guardian or
other relative of such minor or court appointed committee of any
incompetent, or to any adult with whom such person temporarily or
permanently resides; and any such discretion to expend such distribution
for the use and benefit of such person; and the receipt of such
guardian, committee, relative or other person shall be a complete
discharge to the Trustee, without any responsibility on its part or on
the part of the Benefits Committee to see to the application thereof.
10.04 No Contract. This Plan shall not be deemed to constitute a contract
between the Employer and any Participant or to be a consideration or an
inducement for the employment of any Participant or Employee. Nothing
contained in this Plan shall be deemed to give any Participant or
Employee the right to be retained in the service of the Employer or to
interfere with the right of the Employer to discharge any Participant or
Employee at any time regardless of the effect which such discharge shall
have upon such individual as a Participant in the Plan.
10.05 Waiver of Notice. Any notice required under the Plan may be waived by
the person entitled to notice.
10.06 Controlling Law. The Plan and Trust Agreement and all matters relating
thereto shall be governed, construed and administered in accordance with
the applicable laws of the United States and the State of New York
except that if any trust agreement or any contract of insurance entered
into under the Plan shall provide that it shall be governed, construed
or administered in accordance with the laws of any other state, such
agreement or contract shall (to the extent permitted by applicable law)
be so governed, construed or administered.
10.07 Absence of Guarantee. Neither the Benefits Committee nor any Employer in
any way guarantees the Trust Fund from loss or depreciation. Except as
required by applicable law, the Employers do not guarantee any payment
to any person. The liability of the Trustee or the Benefits Committee to
make any payment under the Plan will be limited to the assets held by
the Trustee which are available for that purpose.
10.08 Missing Persons. If the Benefits Committee or Trustee is unable to make
payment to any Participant or other person to whom a payment is due
under the Plan because it cannot ascertain the identity or whereabouts
of such Participant or other person after reasonable efforts have been
made to do so, (including mailing the payment to the last known address
of such Participant or such other person as shown on the records of the
Employer), such payment and any subsequent payments otherwise due shall
be forfeited twenty-four (24) months after the date such payment first
became due; provided, however, that such payment and any subsequent
payments shall be reinstated
63
retroactively, not later than sixty (60) days after the date on which
the Participant or such other person entitled to payment is identified
or located.
10.09 Non-Diversion. There shall be no diversion of any portion of the assets
of the Trust Fund other than for the exclusive benefit of Participants
and their Beneficiaries.
10.10 Return of Contributions. All Employer contributions are made conditioned
upon their deductibility for federal income tax purposes under Section
404 of the Code and upon continuing qualification of the Plan under
Section 401 of the Code. Amounts contributed by an Employer shall be
returned to the Employer under the following conditions:
(a) If a contribution was made by an Employer by a mistake of fact,
the excess of the amount of such contribution over the amount that
would have been contributed had there been no mistake of fact
shall be returned to the Employer within one year after the
payment of the contribution;
(b) If the Plan does not qualify under Section 401 of the Code,
contributions made by an Employer shall be returned to the
Employer within one (1) year after the date of denial of initial
qualification of the Plan, provided that an application for
determination is made by the time prescribed by law for filing the
Employer's federal income tax return for the taxable year in which
the Plan was adopted or such later date as the Secretary of the
Treasury may prescribe; and
(c) If an Employer makes a contribution which is not deductible under
Section 404 of the Code, such contribution (but only to the extent
disallowed) shall be returned to the Employer within one year
after the disallowance of the deduction.
Earnings attributable to the contribution shall not be returned to the
Employer, but losses attributable to such excess contribution must
reduce the amount to be so returned.
10.11 Litigation by Participants or Beneficiaries. If a Participant or other
person brings a legal action against the Trustee, one or more Employers,
and/or the Benefits Committee (or any member or members thereof), and
such action person results adversely to that person, or if a legal
action arises because of conflicting claims to a Participant's or other
person's benefits, the costs borne by the Trustee, the Employers, the
Benefits Committee (or any member or members thereof) in defending the
action will be charged, to the extent permitted by law, to the amounts
involved in the action or which were payable to the Participant or other
person concerned.
64
ARTICLE XI
Top Heavy Provisions
The following provisions shall become effective in any year in which the Plan
is determined to be a Top Heavy Plan.
11.01 Determination of Top Heavy. The Plan will be considered a Top Heavy plan
if, as of the Determination Date, the sum of the present value of the
Accounts for all Key Employees exceeds sixty percent (60%) of a similar
sum for all Participants, or if the Plan is part of a Required
Aggregation Group and the Required Aggregation Group is Top Heavy.
(a) Determination Date with respect to a Plan Year means the last day
of the immediately preceding Plan Year or in the case of the first
Plan Year, the Determination Date means the last day of such Plan
Year.
(b) The Present Value shall be the sum of (i) the Participant's
account balances determined as of the most recent Valuation Date
that is within the twelve (12) month period ending on the
Determination Date; (ii) the adjustment for contributions due as
of the Determination Date; (iii) the aggregate distributions made
with respect to such Employee during the five (5) year period
ending on the Determination Date; and (iv) distributions under a
terminated plan which, if it had not been terminated, would have
been required to be included in an Aggregation Group.
(c) Key Employee means any Employee (or the Beneficiary of such
Employee) who, at any time during the Plan Year or any of the four
(4) preceding Plan Years, is:
(1) an officer of the Employer whose annual Compensation from
the Employer is greater than fifty percent (50%) of the
amount in effect under Section 415(b)(1)(A) of the Code for
any such Plan Year; provided, however, that no more than
fifty (50) Employees (or if less, the greater of three (3)
Employees or ten percent (10%) of the Employees) shall be
considered officers.
(2) one of the ten (10) Employees whose annual Compensation from
the Employer is more than the dollar limitation in effect
under Section 415(c)(1)(A) of the Code and owning (or
considered as owning within the meaning of Section 318 of
the Code) both more than one-half percent (1/2 %) interest
and the one of the ten (10) largest interests in the
Employer. If two (2) Employees have the same interest in the
Employer, the Employee having the greater annual
Compensation from the Employer shall be treated as having a
larger interest.
(3) a five percent (5%) owner of the Employer, or
65
(4) a one percent (1%) owner of the Employer having annual
Compensation from the Employer of more than one hundred
fifty thousand dollars ($150,000).
The aggregation rules of Section 414(b), (c), and (m) of the
Code do not apply for purposes of determining ownership in
the Employer.
(d) The Required Aggregation Group means (i) each qualified plan of
the Employer in which a Key Employee is a Participant, and (ii)
each other qualified plan that enables any of the above plans to
meet the requirements of Section 401(a)(4) or 410 of the Code.
(e) The Permissive Aggregation Group. The Employer may treat any plan
not required to be included in the Required Aggregation Group as
defined herein as being part of such group if the group would
continue to meet the requirements of Sections 401(a)(4) and 410 of
the Code with the plan being taken into account.
(f) Rollover Deposits. Except as provided in Treasury regulations, any
Rollover Deposits (or similar transfer) initiated by the Employee
to a plan in the Aggregation Group shall not be taken into account
with respect to the transferee plan for purposes of determining
whether this Plan is Top Heavy.
(g) No Services for Five Years. The account of an individual who has
not performed services for any Employer maintaining the plan at
any time during the five- (5) year period ending on the
Determination Date shall not be considered for purposes of this
Section.
(h) Non-Key Employee means any Employee (and any Beneficiary of an
Employee) who does not meet the definition of Key Employee. If an
individual is a Non-Key Employee with respect to any plan for any
Plan Year but such individual was a Key Employee with respect to
such plan for any prior Plan Year, any accrued benefit of such
Employee (and the account of such Employee) shall not be taken
into account in this Section.
(i) Compensation for purposes of this Article means Total
Compensation.
11.02 Minimum Employer Contribution.
(a) The sum of the Employer contributions allocated to the Account of
each Participant who is a Non-Key Employee for each Plan Year for
which the Plan is determined to be Top Heavy shall not be less
than the smallest of (i) three percent (3%) of such Participant's
Discrimination Compensation or (ii) a percentage of the
Participant's Discrimination Compensation for the Plan Year that
is the same percentage as the greatest percentage of
Discrimination Compensation allocated (as Employer contributions
and forfeitures) to the account of any Key Employee.
66
Amounts contributed pursuant to a salary reduction agreement shall
be included in determining the amount contributed on behalf of a
Key Employee when the minimum contribution is less than three
percent (3%) of Discrimination Compensation but shall not be taken
into account as an Employee contribution for the purposes of this
Section.
(b) Subsection (a) shall not apply in any Plan Year in which each
Participant who is a Non-Key Employee has a benefit under a
defined benefit plan maintained by the Employer that : (i) meets
the benefit requirements of Section 416(c)(1) of the Code; and
(ii) is guaranteed under the defined benefit plan under provisions
intended to take effect in any year during which such plan is Top
Heavy. A defined benefit plan shall be considered for purposes of
this subsection only if it is in the aggregation group of which
this Plan is a part.
(c) In any Plan Year in which this Plan is Top Heavy, the Benefits
Committee may limit allocations of Employer contributions to Key
Employees, in a uniform manner, as a maximum dollar amount or as a
maximum percentage of compensation. No action by the Benefits
Committee under this Subsection shall increase the benefits of any
Key Employee.
(d) Stock-Based Company Matching Deposits and Qualified Nonelective
Contributions (and prior to September 1, 2001 Company Matching
Deposits) may be treated as Employer contributions for purposes of
Section 11.02(a). Provided, however, that Stock-Based Company
Matching Deposits and Unrestricted Company Matching Deposits
(prior to September 1, 2001, the Company Matching Deposit Account)
used to satisfy the minimum contribution requirements with respect
to Non-Key Employees must meet the nondiscrimination requirements
of Section 401(a)(4) of the Code without regard to Section 401(m)
and may not be included as Matching Deposits or as Qualified
Matching Contributions for the purposes of the ADP or ACP Test.
11.03 Vesting.
(a) For any Plan Year in which this Plan is Top Heavy, and for each
Plan Year thereafter, each Participant's Vesting Percentage shall
be not less than the amount shown on the following table:
Completed Vesting Percentage
Years of Applicable to
Service Company Deposits
0-1 0%
2 20%
3 40%
4 60%
5 100%
67
(b) Notwithstanding the above, the Vested Percentage of a
Participant's Accrued Benefit shall not be less than the Vested
Percentage determined as of the last day of the last Plan Year in
which the Plan was not Top-Heavy.
(c) In the event the Plan becomes Top-Heavy, each Participant who has
completed at least three (3) Years of Service may elect to
continue to have his Vesting Percentage computed in accordance
with the vesting schedule in effect before the Plan becomes
Top-Heavy.
11.04 Impact on Maximum Benefits. In the event that the aggregate of the sum
of the Accounts of Participants who are Key Employees under the Plan
exceeds ninety percent (90%) of the aggregate of the sum of the Accounts
of all Participants, Section 3.05 shall be modified by substituting "one
hundred percent (100%)" for one hundred twenty-five percent (125%)"
wherever it appears therein.
In the event that the aggregate of the sum of the Accounts of
Participants who are Key Employees under the Plan exceeds sixty percent
(60%) but is not more than ninety percent (90%) of the aggregate of the
sum of the Accounts of all Participants, Section 11.02(a) shall be
modified by substituting "four percent (4%)" for "three percent (3%)"
wherever it appears therein.
68
ARTICLE XII
Adoption of the Plan by Other Entities
12.01 Adoption of Plan. Any subsidiary, affiliate company, or other entity
may, in the future, adopt this Plan for all or a portion of its
employees, provided that the Board approves such participation and the
basis of such participation is set forth in a Participation Agreement by
and between such Participating Employer and the Board.
The Participation Agreement may modify any of the terms of the Plan as
applied to employees of such entity. The administrative powers and
control of the Company as provided in the Plan shall not be deemed
diminished under the Plan by reason of the participation of other
companies in the Plan. However, each Participating Employer shall have
the obligation to pay the contributions for its own employees and no
other corporation shall have such obligation.
12.02 Withdrawal from Plan. A Participating Employer may withdraw at any time
from the Plan without affecting the other Participating Employers by
complying with the appropriate provisions of the Plan and Trust. The
Board may, at its discretion, terminate a Participating Employer's
participation in the Plan at any time, when in its judgment, such
Participating Employer fails or refuses to discharge its obligations
under the Plan, or if amendments to the Plan applicable to such
Participating Employer are not deemed to be in the best interests of the
Plan as a whole.
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ARTICLE XIII
The Trustee
13.01 General Duties. The Company and the Trustee(s) shall establish one or
more Trusts pursuant to the terms of the Plan and shall hold all
property received by it hereunder and shall manage, invest and reinvest
the portion of the Trust Fund allocated thereto, collect the income
thereof, and make payments therefrom, all as provided in the Plan. Plan
assets not designated as held pursuant to another Trust Agreement shall
be held pursuant to the trust provisions of this Article. Plan assets
designated as held pursuant to another Trust Agreement shall be held
pursuant to the provisions of such agreement and this Section 13.01.
Except as provided in ERISA Section 405, the Trustee under each Trust
shall be responsible only for the property actually received by it
hereunder. It shall have no duty or authority to compute any amount to
be paid to it by the Employer or to bring any action or proceeding to
enforce the collection from the Employer of any contribution to the
Trust Fund.
Title to the portion of the Trust Fund allocated to a Trustee, including
all funds and investments held under a Trust Agreement by the applicable
Trustee, shall be and remain in the Trustee, and no Participant, Retired
Participant or Beneficiary shall have any legal or equitable right or
interest in the Trust Fund except to the extent that such rights or
interests are expressly granted under the provisions of the Plan.
13.02 General Powers. Subject to the provisions of Section 10.03, the Trustee
shall have all the powers necessary for the performance of its duties as
Trustee. The Trustee shall have the following powers and immunities and
be subject to the following duties:
(a) The Trustee shall receive all contributions hereunder and apply
such contributions as hereinafter set forth. The Trustee shall
have the custody of and safely keep all cash, securities, property
and investments received or purchased in accordance with the terms
hereof.
(b) Subject to any limitations that may be contained elsewhere in the
Plan, the Trustees shall take control and management of the Trust
Fund and shall hold, sell, buy, exchange, invest and reinvest the
corpus and income of the Trust Funds. All contributions paid to
the Trustees under the Plan shall be held and administered by the
Trustees in accordance with Section 13.09, hereof, provided that
if the Trust is not divided into two or more funds pursuant to
Section 13.09, then all such contributions shall be held and
administered by the Trustee as a single Trust Fund, and the
Trustees shall not be required to segregate and invest separately
any part of the Trust Fund representing accruals or interests of
individual Participants in the Plan.
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(c) The Trustee shall invest and reinvest part or all of the balance
of the Trust Fund in any real or personal property, including
investments in any stocks, bonds, notes, debentures, mortgages,
mutual fund shares, commercial paper, treasury bills, any interest
bearing deposits which bear a reasonable interest rate held by a
federally insured institution (which may be affiliated with the
Trustee), and, with the consent of the Company, qualifying
employer securities and qualifying employer real property, as
defined in Section 407(d) of ERISA, and individual or group
annuity or other insurance company investment contracts (and in
connection therewith, to hold such contracts in trust pursuant
hereto and exercise all of the rights and privileges of ownership
of such contracts as the Trustee deems advisable). In addition,
the Trustee shall have the power to invest and reinvest all or any
part of the Trust Fund through the medium of any common,
collective or commingled trust fund maintained by a bank or trust
company (including the Trustee or its affiliate) which holds the
assets of plans, is qualified under section 401(a), and is exempt
under Section 501(a) of the Internal Revenue Code of 1986, as such
Sections may be from time to time amended or renumbered, and
during such period of time as an investment through any such
medium shall exist, the Declaration of Trust of such fund shall
constitute a part of this Agreement. The Trustee shall diversify
such investments so as to minimize the risk of large losses,
unless under the circumstances it is clearly prudent not to do so.
The Trustee may retain in cash such amounts as the Trustee
considers advisable and as permitted by applicable law and to
deposit any cash so retained in any depository (which may be
affiliated with the Trustee) which the Trustee may select, without
liability for interest.
The Trustee may invest and reinvest the funds of the Trust Fund
which are transferred from predecessor plans ("the Transferred
Fund") in any property, real, personal or mixed, wherever situate,
and whether or not productive of income or consisting of wasting
assets, including, without limitation, common and preferred stock,
bonds, notes, debenture, leaseholds, mortgages (including without
limitation, any collective or part interest in any bond and
mortgage or note and mortgage), certificates of deposit, and oil,
mineral or gas properties, royalties, interests or rights
(including equipment pertaining thereto), without being limited to
the classes of property in which trustees are authorized by law or
any rule of court to invest trust funds and without regard to the
proportion any such property may bear to the entire amount of the
Trust Fund.
(d) The Trustee may sell of exchange any property or asset of the
Trust Fund at public or private sale, with or without
advertisement, upon terms acceptable to the Trustee and in such
manner as the Trustee may deem wise and proper. The proceeds of
any such sale or exchange may be reinvested as is provided
hereunder. The purchaser of any such property from the Trustee
shall not be required to look to the application of the proceeds
of any such sale or exchange by the Trustee.
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(e) The Trustee shall have full power to mortgage, pledge, lease or
otherwise dispose of the property of the Trust Fund without
securing any order of court therefor, without advertisement, and
to execute any instrument containing any provisions which the
Trustee may deem proper in order to carry out such actions. Any
such lease so made by the Trustee shall be binding,
notwithstanding the fact that the term of the lease may extend
beyond the termination of the Plan.
(f) The Trustee shall have the power to borrow money upon terms
agreeable to the Trustee and pay interest thereon at rates
agreeable to the Trustee, and to repay and debts so created.
(g) The Trustee may participate in the reorganization,
recapitalization, merger or consolidation of any corporation
wherein the Trustee may own stock or securities and may deposit
such stock or other securities in any voting trust, or with the
depositories designated thereby, and may exercise any subscription
rights or conversion privileges, and generally may exercise any of
the powers of any owner with respect to any stock or other
securities or property comprising the Trust Fund.
(h) The Trustee may, subject to Section 13.04 hereof, vote any share
of stock which the Trustee may own from time to time.
(i) The Trustee shall not be responsible for the adequacy of the Trust
Fund to discharge any and all payments under the Plan. All persons
dealing with the Trustee are released from inquiry into the
decision or authority of the Trustee to act.
(j) The Trustee may hold stocks, bonds, or other securities in his own
name as Trustee, with or without the designation of said trust
estate, or in the name of a nominee selected by it for the
purpose, but said Trustee shall, nevertheless, be obligated to
account for all securities received by it as part of the corpus of
the trust estate herein created, notwithstanding the name in which
the same may be held.
(k) The Trustee may consult with legal counsel (who may be of counsel
to the Employer of the Benefits Committee) concerning any
questions which may arise with reference to the construction of
this Plan, its duties hereunder, or any actions which it proposes
to take or omit.
(l) The Trustee may employ such counsel, accountants and other agents
as it shall deem advisable. The Trustee may charge the
compensation of such counsel, accountants and other agents and the
Trustee's compensation for its services in such amounts as may be
agreed upon from time to time by the Employer and the Trustee, and
any other expenses necessary in the administration of this Plan
again the Trust Fund to the extent they are not paid by the
Employer. Brokerage commissions, transfer taxes and other charges
and expenses in connection with
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the purchase or sale of securities shall be added to the cost of
such securities or deducted from the proceeds thereof, as the case
may be.
(m) The Trustee shall have the power to designate a bank or trust
company as depository of the funds or property of the Trust and
also to retain investment counsel, and the Trustee may deposit
funds in its commercial banking department without making bond.
(n) Without diminution or restriction of the powers vested by law or
elsewhere in this Plan, and subject to all the provisions of the
Plan, the Trustee, without the necessity of procuring any judicial
authorization therefor or approval thereof, shall be vested with
and, in the application of its best judgment and discretion on
behalf of the beneficiaries of this Plan, shall be authorized to
exercise all or any of the powers specifically permitted by
statute or judicial decision in the State of Tennessee.
13.03 Appointment of Investment Manager; Group Annuity Contract. The
Investment Committee of the Company's Board (the "Investment Committee")
may from time to time appoint one or more investment managers
(individually or collectively, the "Investment Manager") which shall
meet the requirements set forth in Section 3(38) of the Employee
Retirement Income Security Act of 1974 to effect in its sole discretion
the investment powers set forth in paragraphs (c) through (i) of Section
13.02 hereof, with respect to all or any portion of the Transferred
Fund, as shall be designated by the Investment Committee, to the same
extent as the Trustee could otherwise do itself. The powers conferred by
paragraphs (c) through (i) of Section 13.02 hereof, shall be exercised
by the Trustee with respect to any portion of the Transferred Fund
managed by the Investment Manager only when, if and in the manner
directed by the Investment Manager.
The Trustee shall have no duty to question any direction of the
Investment Manager with respect to the portion of the Transferred Fund
managed by the Investment Manager or to review any securities or
property held in such portion, or to make any suggestions with respect
to the investment and reinvestment of such portion. The Trustee shall be
fully protected in acting in accordance with the directions of the
Investment Manager or for failing to act in the absence of such
directions.
All or any portion of the Transferred Fund, as shall be designated by
the Investment Committee, shall be invested and reinvested under a group
annuity or similar type of insurance contract or contracts which the
Trustee shall have entered into with an insurance company at the
direction of the Investment Committee.
13.04 Reliance on Benefits Committee and Employer. Until notified pursuant to
Article VIII hereof, that any Benefits Committee member or other person
authorized to act for the Benefits Committee has ceased to act or is no
longer authorized to act for the Committee, the Trustee may continue to
rely on the authority of such member or other person. The Trustee may
rely upon any certificate, notice or direction purporting to have been
signed on behalf of the Benefits Committee which the Trustee believes to
have been signed by
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the Benefits Committee or the person or persons authorized to act for
the Committee. The Trustee may rely upon any certificate, notice or
direction of the employer that the Trustee believes to have been signed
by a duly authorized officer or agent of the Employer. The Trustee may
request instructions in writing from the Committee on other matters and
may rely and act thereon.
13.05 Accounts and Reports. The Trustee shall keep an accurate record of its
administration of the Trust Fund, including a detailed account of all
investments, receipts and disbursements, and other transactions
hereunder. All accounts, books and records relating hereto shall be open
for inspection to any person designated by the Benefits Committee or the
Company at all reasonable times. Within sixty (60) days following the
close of each Plan Year, the Trustee shall file with the Benefits
Committee a written report setting forth all investments, receipts and
disbursements and other transactions during the Plan Year, and such
report shall contain an exact description of all securities purchased,
exchanged or sold, the cost or net proceeds of sale, and shall show the
securities and investments held at the end of such Plan Year, and the
cost and fair market value of each item thereof, as carried on the books
of the Trustee.
The Trustee shall also provide the Company and the Benefits Committee
with such other information in its possession as may be necessary for
the Benefits Committee to comply with the reporting and disclosure
requirements of ERISA.
Upon the expiration of ninety (90) days from the date of filing such
report and to the maximum extent permitted by federal regulations, the
Trustee shall be forever released and discharged from all liability and
accountability to anyone with respect to the recording of its acts and
transactions shown in such statement, except with respect to any such
acts or transactions as to which the Company or Benefits Committee shall
file with the Trustee written objections within such ninety (90) days
period.
13.06 Disbursements. The Trustee, upon written instructions from the Benefits
Committee, shall make distributions and/or payments, including monthly
payments, to the Participants, Retired Participants, and Beneficiaries
who qualify for such benefits. The Trustee shall have no liability to
the Employer, the Committee or any other person in making such
distributions and/or payments. The Trustee shall not be required to
determine or make any investigation to determine the identity or mailing
address of any person entitled to benefits under the Plan and shall have
discharged its obligation in that respect when it shall have sent checks
and other papers by ordinary mail to such person or persons at such
addresses as may be certified to it in writing by the Committee.
13.07 Authority of Trustee. At no time during the administration of the Trust
Fund shall the Trustee be required to obtain any court approval of any
act required of it in connection with the performance of its duties or
in the performance of any act required of it in the administration of
its duties as Trustee. The Trustee shall have full authority to exercise
its judgment in all matters and at all times without court approval of
such decisions; provided, however, that if any application to, or
proceeding or action in, the courts is made, only the Company and the
Trustee shall be necessary parties, and no Participant in
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the Plan or other person having an interest in the Trust Fund shall be
entitled to any notice or service of process, subject to applicable
federal regulations. Any judgment entered in such proceeding or actions
shall be conclusive upon all persons claiming an interest under the
Trust Fund.
13.08 Trust Funds.
(a) The Trust Fund may be divided into separate funds as repositories
for limited types of investments under this Plan. The Trustee,
with the approval of the Benefits Committee, may establish
additional funds as it deems necessary or desirable in the ongoing
operation of the Plan. The Trustee shall also, with the approval
of the Benefits Committee, have the authority to abolish said
fund(s) and to take all actions necessary in reinvesting the cash
or property of said abolished fund(s) in any of the remaining
fund(s).
(b) The Company may also appoint a separate Trustee or Trustees to act
as Trustee solely over the cash or property invested in any
particular fund. In such case, said Trustee shall be solely
responsible for its powers and duties, in accordance with this
Article XIII, as they relate to that particular fund. The Trustee
shall have no responsibility or liability for the actions of any
other Trustees over any other such fund(s).
(c) The decision of the Trustee of a particular fund as to whether an
investment is of a nature that may be purchased or retained for
its separate fund shall be conclusive upon any and all persons.
13.09 Proxy Votes. Before each annual or special meeting of the stockholders,
Willis Group Holdings Limited (the "Parent Company") shall cause to be
sent to each Participant having shares of Common Stock a copy of the
proxy solicitation material therefor, together with a form requesting
confidential instructions to the Trustee on how to vote the number of
shares of Common Stock which are credited to such Participant's
Accounts. Upon receipt of such instructions, the Trustee shall vote the
such shares as instructed. Instructions received from individual
Participants by the Trustee shall be held in the strictest confidence
and shall not be divulged or released to any person, including officers
or employees of the Parent Company. The Trustee shall vote all shares of
Common Stock held by it under the Plan for which voting instructions
shall not have been received for or against the proposals submitted, in
the same proportion as the shares for which instructions are received by
the Trustee from Participants.
13.10 Tender Offer. Notwithstanding the foregoing provisions of this Article
XIII, in the case of a tender offer for the Common Stock, the Trustee
shall be bound by the provisions of this Section. As soon as practicable
after the commencement of a tender offer, the Parent Company (as defined
in Section 13.09) shall cause each Participant who has shares of Common
Stock credited to his or her Accounts under the Plan, to be advised, in
writing, as to the terms of the tender offer, together with a form
requesting confidential instructions to the Trustee on whether to tender
the number of shares of Common Stock
75
which are credited to his or her Accounts under the Plan. Each such
Participant shall be given an opportunity to instruct individually
whether shares of Common Stock credited to his or her Accounts shall be
tendered. For purposes of this Section, the number of shares of Common
Stock as to which a Participant may instruct the Trustee, shall be the
total number of such shares credited to his or her Accounts under the
Plan as of the most recent Valuation Date, for which calculations have
been completed at the date of notice of the tender offer to Participants
(the "Recent Valuation Date"). Upon receipt of such instructions, the
Trustee shall tender the number of shares of Common Stock as to which it
received timely instructions to tender. If a Participant instructs the
Trustee not to tender, if no response is received from a Participant or
if a Participant returns his or her instruction form without indicating
his or her instructions, then the Trustee shall not tender the shares of
Common Stock credited to such Participant's accounts. With respect to
any shares of Common Stock held in the Trust Fund in excess of the
aggregate number of such shares credited to Participants' Accounts as of
the Recent Valuation Date, the Trustee may tender or not tender such
shares in its complete discretion. In communicating with Participants
for the purpose of securing instructions as to whether to tender their
shares of Common Stock, the Parent Company may cause to be included a
statement from the Board of Directors of the Parent Company setting
forth its position with respect to the tender offer. The giving of
instructions to the Trustee to tender shares of Common Stock, shall not
be deemed to constitute a withdrawal or suspension from the Plan or a
forfeiture of any portion of a Participant's interest in the Plan.
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