EXHIBIT 4.1
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03/24/95
Basic Plan Document No. 05
PRISM{R}
PROTOTYPE RETIREMENT
PLAN AND TRUST
PRISM{R} PROTOTYPE RETIREMENT PLAN AND TRUST
TABLE OF CONTENTS
Article Page
I DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1 DEFINITIONS . . . . . . . . . . . . . . . . . . . . . 1
1.2 GENDER AND NUMBER . . . . . . . . . . . . . . . . . . 13
1.3 CONTROL OF TRADES OR BUSINESSES BY OWNER-EMPLOYEE . . 13
II ELIGIBILITY AND VESTING . . . . . . . . . . . . . . . . . . 14
2.1 ELIGIBILITY . . . . . . . . . . . . . . . . . . . . . 14
2.2 VESTING . . . . . . . . . . . . . . . . . . . . . . . 16
III CODE 401(k) AND CODE 401(m) ARRANGEMENTS . . . . . . . . . . 18
3.1 PROVISION RELATING TO BOTH BEFORE TAX CONTRIBUTIONS
AND AFTER TAX CONTRIBUTIONS . . . . . . . . . . . . . 18
3.2 BEFORE TAX CONTRIBUTIONS. (ELECTIVE DEFERRALS) . . . 22
3.3 AFTER TAX CONTRIBUTIONS. (EMPLOYEE CONTRIBUTIONS) . 29
3.4 EMPLOYER CONTRIBUTIONS . . . . . . . . . . . . . . . 30
3.5 LIMITATIONS ON AFTER TAX CONTRIBUTIONS (EMPLOYEE
CONTRIBUTIONS) AND MATCHING CONTRIBUTIONS . . . . . . 31
3.6 NET PROFITS NOT REQUIRED IF SO ELECTED IN ADOPTION
AGREEMENT . . . . . . . . . . . . . . . . . . . . . . 35
3.7 FORM, PAYMENT AND ALLOCATION OF CONTRIBUTIONS. . . . 35
3.8 DISTRIBUTION REQUIREMENTS FOR BEFORE TAX CONTRIBUTION
ACCOUNT . . . . . . . . . . . . . . . . . . . . . . . 35
3.9 HARDSHIP DISTRIBUTION . . . . . . . . . . . . . . . . 36
3.10 WITHDRAWAL OF AFTER TAX CONTRIBUTIONS . . . . . . . . 38
3.11 WITHDRAWAL OF MATCHING CONTRIBUTIONS . . . . . . . . 38
IV OTHER CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . 39
4.1 EMPLOYER CONTRIBUTIONS . . . . . . . . . . . . . . . 39
4.2 SEPARATE ACCOUNTS . . . . . . . . . . . . . . . . . . 39
4.3 VESTING . . . . . . . . . . . . . . . . . . . . . . . 40
4.4 LIMITATION ON EMPLOYER CONTRIBUTIONS . . . . . . . . 40
4.5 EMPLOYEE CONTRIBUTIONS . . . . . . . . . . . . . . . 40
4.6 EXCLUSIVE BENEFIT . . . . . . . . . . . . . . . . . . 41
4.7 FORM, PAYMENT AND ALLOCATION OF CONTRIBUTIONS . . . . 42
4.8 SAFE HARBOR ALLOCATION . . . . . . . . . . . . . . . 42
V PERIOD OF PARTICIPATION . . . . . . . . . . . . . . . . . . 43
5.1 TERMINATION DATES . . . . . . . . . . . . . . . . . . 43
5.2 RESTRICTED PARTICIPATION . . . . . . . . . . . . . . 43
VI ACCOUNTING . . . . . . . . . . . . . . . . . . . . . . . . . 44
6.1 ACCOUNTS ESTABLISHED . . . . . . . . . . . . . . . . 44
6.2 EMPLOYER CONTRIBUTIONS CONSIDERED MADE ON LAST DAY OF
PLAN YEAR . . . . . . . . . . . . . . . . . . . . . . 44
6.3 ACCOUNTING STEPS . . . . . . . . . . . . . . . . . . 44
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6.4 ALLOCATION OF EMPLOYER CONTRIBUTIONS . . . . . . . . 45
6.5 ALLOCATION OF FORFEITURES . . . . . . . . . . . . . . 45
6.6 LIMITATIONS ON ALLOCATIONS . . . . . . . . . . . . . 46
6.7 REPORTS TO PARTICIPANTS . . . . . . . . . . . . . . . 55
VII PAYMENT OF ACCOUNT BALANCES . . . . . . . . . . . . . . . . . 55
7.1 TERMINATION OF EMPLOYMENT UPON DISABILITY OR DEATH . 55
7.2 TIMING FOR DETERMINING ACCOUNT BALANCE UPON
TERMINATION OF EMPLOYMENT PRIOR TO RETIREMENT,
DISABILITY OR DEATH . . . . . . . . . . . . . . . . . 56
7.3 VESTING ON DISTRIBUTION BEFORE BREAK-IN-SERVICE;
CASH-OUTS . . . . . . . . . . . . . . . . . . . . . . 56
7.4 RESTRICTIONS ON IMMEDIATE DISTRIBUTIONS . . . . . . . 57
7.5 COMMENCEMENT OF BENEFITS . . . . . . . . . . . . . . 58
7.6 TIMING AND MODES OF DISTRIBUTION . . . . . . . . . . 59
7.7 DESIGNATION OF BENEFICIARY . . . . . . . . . . . . . 67
7.8 OPTIONAL FORMS OF BENEFIT . . . . . . . . . . . . . . 68
7.9 DISTRIBUTION UPON DISABILITY . . . . . . . . . . . . 68
7.10 JOINT AND SURVIVOR ANNUITY REQUIREMENTS . . . . . . . 68
7.11 DISTRIBUTIONS TO QUALIFIED PLANS . . . . . . . . . . 75
7.12 PROFIT SHARING PLANS AND 401(K) PROFIT SHARING PLANS
ONLY - WITHDRAWAL OF EMPLOYER CONTRIBUTIONS . . . . . 75
7.13. PROHIBITION AGAINST ALIENATION . . . . . . . . . . . 76
7.14 MISSING PARTICIPANT OR BENEFICIARY . . . . . . . . . 77
7.15 LIMITATION ON CERTAIN DISTRIBUTIONS . . . . . . . . . 77
VIII DIRECT ROLLOVERS . . . . . . . . . . . . . . . . . . . . . . 78
8.1 GENERAL . . . . . . . . . . . . . . . . . . . . . . . 78
8.2 DEFINITIONS . . . . . . . . . . . . . . . . . . . . . 78
IX TOP-HEAVY PROVISIONS . . . . . . . . . . . . . . . . . . . . 79
9.1 USE OF TOP-HEAVY PROVISIONS . . . . . . . . . . . . . 79
9.2 TOP-HEAVY DEFINITIONS . . . . . . . . . . . . . . . . 79
9.3 MINIMUM ALLOCATION . . . . . . . . . . . . . . . . . 82
9.4 MINIMUM VESTING SCHEDULES . . . . . . . . . . . . . . 83
X TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . . . 84
10.1 TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . 84
10.2 RECORDS AND ACCOUNTS OF TRUSTEE . . . . . . . . . . . 84
10.3 REPORTS TO EMPLOYER . . . . . . . . . . . . . . . . . 84
10.4 POWERS OF TRUSTEE . . . . . . . . . . . . . . . . . . 84
10.5 TRUSTEE'S FEES AND EXPENSES . . . . . . . . . . . . . 87
10.6 TRUSTEE MAY RESIGN OR BE REMOVED . . . . . . . . . . 88
10.7 SEPARATE INVESTMENT FUNDS . . . . . . . . . . . . . . 88
10.8 REGISTRATION, DISTRIBUTION AND VOTING OF EMPLOYER
STOCK AND PROCEDURES REGARDING TENDER OFFERS . . . . 94
10.9 VALUATION OF IN VESTMENT FUNDS AND ACCOUNTS . . . . . 98
XI ADMINISTRATION . . . . . . . . . . . . . . . . . . . . . . . 99
11.1 COMMITTEE MEMBERSHIP . . . . . . . . . . . . . . . . 99
11.2 POWERS AND DUTIES OF COMMITTEE . . . . . . . . . . . 99
11.3 ACTIONS OF THE COMMITTEE . . . . . . . . . . . . . . 100
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11.4 RESIGNATION, REMOVAL AND DESIGNATION OF SUCCESSORS . 101
11.5 COMMITTEE REVIEW . . . . . . . . . . . . . . . . . . 101
11.6 RECORDS . . . . . . . . . . . . . . . . . . . . . . . 102
11.7 COMPENSATION . . . . . . . . . . . . . . . . . . . . 102
11.8 DESIGNATION OF NAMED FIDUCIARIES AND ALLOCATION OF
RESPONSIBILITY AMONG FIDUCIARIES . . . . . . . . . . 102
11.9 NOTICE BY COMMITTEE OR EMPLOYER . . . . . . . . . . . 102
11.10 LOANS TO PARTICIPANTS . . . . . . . . . . . . . . . . 103
XII FAILURE TO ATTAIN OR RETAIN QUALIFIED STATUS . . . . . . . . 106
12.1 FAILURE TO QUALIFY AS A PROTOTYPE . . . . . . . . . . 106
12.2 FAILURE OF EMPLOYER TO ATTAIN OR RETAIN
QUALIFICATION . . . . . . . . . . . . . . . . . . . . 107
XIII MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . 107
13.1 EMPLOYER ACTION . . . . . . . . . . . . . . . . . . . 107
13.2 NO GUARANTEE OF INTERESTS . . . . . . . . . . . . . . 107
13.3 EMPLOYMENT RIGHTS . . . . . . . . . . . . . . . . . . 107
13.4 INTERPRETATIONS AND ADJUSTMENTS . . . . . . . . . . . 107
13.5 UNIFORM RULES . . . . . . . . . . . . . . . . . . . . 107
13.6 EVIDENCE . . . . . . . . . . . . . . . . . . . . . . 107
13.7 WAIVER OF NOTICE . . . . . . . . . . . . . . . . . . 107
13.8 CONTROLLING LAW . . . . . . . . . . . . . . . . . . . 107
13.9 TAX EXEMPTION OF TRUST . . . . . . . . . . . . . . . 108
13.10 COUNTERPARTS . . . . . . . . . . . . . . . . . . . . 108
13.11 ANNUAL STATEMENT OF ACCOUNT . . . . . . . . . . . . . 108
13.12 NO DUTY TO INQUIRE . . . . . . . . . . . . . . . . . 108
13.13 INVALIDITY . . . . . . . . . . . . . . . . . . . . . 108
13.14 TITLES . . . . . . . . . . . . . . . . . . . . . . . 108
13.15 NO DUTY OF TRUSTEE TO COLLECT CONTRIBUTIONS . . . . . 108
13.16 TRUSTEE DISTRIBUTES BY COMMITTEE DIRECTION . . . . . 108
XIV AMENDMENT OR TERMINATION . . . . . . . . . . . . . . . . . . 109
14.1 AMENDMENT BY THE SPONSOR . . . . . . . . . . . . . . 109
14.2 AMENDMENT BY ADOPTING EMPLOYER . . . . . . . . . . . 109
14.3 VESTING - PLAN TERMINATION . . . . . . . . . . . . . 109
14.4 VESTING - COMPLETE DISCONTINUANCE OF CONTRIBUTIONS . 110
14.5 PLAN MERGER - MAINTENANCE OF BENEFIT . . . . . . . . 110
14.6 DIRECT TRANSFER . . . . . . . . . . . . . . . . . . . 110
14.7 TERMINATION OF PARTICIPATION BY EMPLOYER . . . . . . 110
14.8 NOTICE OF AMENDMENT, TERMINATION OR PARTIAL
TERMINATION . . . . . . . . . . . . . . . . . . . . . 111
14.9 SUBSTITUTION OF TRUSTEE . . . . . . . . . . . . . . . 111
XV DISCHARGE OF DUTIES BY FIDUCIARIES . . . . . . . . . . . . . 111
15.1 DISCHARGE OF DUTIES . . . . . . . . . . . . . . . . . 111
XVI AMENDMENT AND CONTINUATION OF ORIGINAL PLAN . . . . . . . . 111
16.1 AMENDMENT AND CONTINUATION . . . . . . . . . . . . . 111
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PRISM{R} PROTOTYPE RETIREMENT PLAN AND TRUST
ARTICLE I
DEFINITIONS
1.1 DEFINITIONS. Unless the context indicates otherwise, the
following terms, when used herein with initial capital
letters, shall have the meanings set forth below:
(A) ACCOUNTING DATE: The date which is the last business
day of each month of the Employer's Plan Year or such
other date as may be agreed upon between the Employer
and the Trustee, but only if the Employer has
specifically requested the Trustee to prepare an
accounting on or before such date. Notwithstanding the
foregoing, the Trustee shall value the assets held in
the Trust on each business day that the Trustee and the
New York Stock Exchange are open for business.
(B) ADOPTION AGREEMENT: The Adoption Agreement adopting
this Plan which has been executed by the Employer and
accepted by the Trustee, including any amendment
thereof, which is incorporated herein by reference.
(C) BASIC PLAN DOCUMENT: This document, which, in
connection with the Adoption Agreement forms the Plan.
(D) BENEFICIARY: The person or persons to whom a deceased
Participant's benefits are payable under the Plan.
(E) BREAK IN SERVICE: A 12-consecutive month period during
which the Participant does not complete more than one-
half of the Hours of Service with the Employer required
for a Year of Service, as elected in the Adoption
Agreement. For eligibility purposes, the initial 12-
consecutive month period is the period beginning on the
Employees date of hire. Subsequent 12-consecutive month
periods for eligibility purposes will be either the
period ending on the annual anniversary of the
Employee's date of hire on the Plan Year, as selected in
the Adoption Agreement. For all other purposes the 12-
consecutive month period shall be the Plan Year, or
other computation period as selected in the Adoption
Agreement. If the elapsed time method of crediting
service is elected in the Adoption Agreement, "Break In
Service" will mean a Period of Severance of at least 12
consecutive months.
(F) CODE: The Internal Revenue Code of 1986, and amendments
thereto.
(G) COMMITTEE: The Committee provided for in Article XI,
which shall be a Named Fiduciary as defined in the
Employee Retirement Income Security Act of 1974, as
amended ("ERISA"). To the extent that the Employer does
not appoint a Committee, the Employer shall have the
duty of the day to day administration of the Plan and
shall be the Named Fiduciary for that purpose.
(H) COMPENSATION: Compensation shall have the following
various definitions, as may be appropriate within the
context of the Plan:
(1) Compensation as that term is defined in Section
6.6(A) of the Plan. For any Self- Employed
Individual covered under the Plan, Compensation
will mean Earned Income. Compensation shall
include only that compensation which is actually
paid to the Participant during the determination
period. Except as provided elsewhere in this
Plan, the determination period shall be the period
elected by the Employer in the Adoption Agreement.
If the Employer makes no election, the
determination period shall be the Plan Year. For
purposes of allocations of Employer Profit Sharing
or Matching Contributions, the definition of
Compensation in Section 6.6(A)(2)(a) shall be
used, as modified in the Adoption Agreement.
Notwithstanding the above, if elected by the
Employer in the Adoption Agreement, Compensation
for allocation purposes shall 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 the employee
under Sections 125, 402(e)(3), 402(h)(1)(B) or
403(b) of the Code.
(2) For years beginning after December 31, 1988, and
prior to January 1, 1994, the annual Compensation
of each Participant taken into account for
determining all benefits provided under the Plan
for any determination period shall not exceed
$200,000. This limitation shall be adjusted by
the Secretary at the same time and in the same
manner as under Section 415(d) of the Code except
that the dollar increase in effect on January 1 of
any calendar year is effective for plan years
beginning in such calendar year and the first
adjustment to the $200,000 limitation is effective
on January 1, 1990. After December 31, 1993, the
annual Compensation of each Participant taken into
account for determining all benefits provided
under the Plan for any determination period shall
not exceed $150,000, or such other lesser amount
as may be specified in the Adoption Agreement.
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This limitation shall be adjusted by the Secretary
at the same time and in the same manner as under
Section 415(d) of the Code. If a Plan determines
Compensation on a period of time that contains
fewer than 12 calendar months, then the annual
Compensation limit is an amount equal to the
annual Compensation limit for the calendar year in
which the Compensation period begins multiplied by
a ratio obtained by dividing the number of full
months in the period by 12.
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 descendants of the Participant who have not
attained age 19 before the close of the year. If,
as a result of the application of such rules the
adjusted annual compensation limitation is
exceeded, then (except for purposes of determining
the portion of Compensation up to the integration
level if this Plan provides for permitted
disparity), 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.
If compensation for any prior determination period
is taken into account in determining an Employee's
allocations or benefits for the current
determination period, the compensation for such
prior year is subject to the applicable annual
compensation limit in effect for that prior year.
For this purpose, for years beginning before
January 1, 1990, the applicable compensation limit
is $200,000. In addition, in determining
allocations in plan years beginning on or after
January 1, 1994, the annual compensation limit in
effect for determination periods beginning before
that date is $150,000.
(I) DISABILITY: The inability to engage in any substantial
gainful activity by reason of any medically determinable
physical or mental impairment which can be expected to
result in death or which has lasted or can be expected
to last for a continuous period of not less than twelve
(12) months. The permanence and degree of such
impairment shall be supported by medical evidence. The
Employer shall determine the existence of a Disability
3
based on its current disability policy, applied on a
uniform and nondiscriminatory basis.
(J) EARNED INCOME: The net earnings from self-employment in
the trade or business with respect to which the Plan is
established, for which personal services of the
individual are a material income-producing factor. Net
earnings will be determined without regard to items not
included in gross income and the deductions allocable to
such items. Net earnings are reduced by contributions
by the Employer to a qualified Plan to the extent
deductible under Section 404 of the Code. Net earnings
shall be determined with regard to the deduction allowed
to the taxpayer by Section 164(f) of the Code for
taxable years beginning after December 31, 1989.
(K) EARLY RETIREMENT DATE: The date specified in the
Adoption Agreement at which a participating Employee may
receive an early retirement benefit.
(L) EFFECTIVE DATE: The date specified in the Adoption
Agreement which shall be the effective date of the
provisions of this Plan, unless modified in Item B(18)
of the Adoption Agreement. If the Plan is a restatement
of an existing Plan, the original effective date of the
Plan shall be as specified in the Adoption Agreement.
(M) ELIGIBLE EMPLOYEE: Any Employee who is eligible to
receive an Employer contribution (including
forfeitures), as defined in Item B(6) of the Adoption
Agreement.
(N) ELIGIBILITY COMPUTATION PERIOD: For purposes of
determining Years of Service and Breaks in Service for
purposes of eligibility, the initial Eligibility
Computation Period is the 12-consecutive month period
beginning on the Employee's Employment Commencement
Date.
(1) For plans in which the Eligibility Computation
Periods commence on the 12-consecutive month
anniversary of the Employee's Employment
Commencement Date, the succeeding 12-consecutive
month periods commence with the first anniversary
of the Employee's Employment Commencement Date.
(2) For plans in which the Eligibility Computation
Period shifts to the Plan Year, the succeeding 12-
consecutive month periods commence with the first
Plan Year which commences prior to the first
anniversary of the Employee's Employment
Commencement Date regardless of whether the
4
Employee is entitled to be credited with number of
Hours of Service specified in the Adoption
Agreement during the initial Eligibility
Computation Period. An Employee who is credited
with number of Hours of Service specified in the
Adoption Agreement in both the initial Eligibility
Computation Period and the first Plan Year which
commences prior to the first anniversary of the
Employee's initial Eligibility Computation Period
will be credited with two Years of Service for
purposes of eligibility to participate.
Years of Service and Breaks in Service will be
measured on the same Eligibility Computation
Period.
(3) Notwithstanding any other provisions of this
section, if the elapsed time method of crediting
service is elected in the Adoption Agreement for
purposes of eligibility, an Employee will receive
credit for the aggregate of all time periods
completed (as may be elected in the Adoption
Agreement) beginning with the Employee's Em-
ployment Commencement Date or Reemployment
Commencement Date and ending on the date a Break
In Service begins. The Employee will receive
credit for any Period of Severance of less than 12
consecutive months.
(O) EMPLOYEE: Any employee, including any Self Employed
Individual, of the Employer maintaining the Plan or of
any other employer required to be aggregated with such
Employer under Sections 414(b), (c), (m) or (o) of the
Code.
The term Employee shall also include any Leased Employee
deemed to be an Employee of any Employer described in
the previous paragraph as provided in Sections 414(n) or
(o) of the Code.
(P) EMPLOYER: The Employer specified in the Adoption
Agreement and any successor to the business of the
Employer establishing the Plan, which shall be the Plan
Administrator for purposes of Section 3(16) of ERISA, a
Named Fiduciary as defined in ERISA, and which may
delegate all on any part of its powers, duties and
authorities in such capacity without ceasing to be such
Plan Administrator.
(Q) EMPLOYMENT COMMENCEMENT DATE: The date on which an
Employee first performs an Hour of Service for the
Employer.
5
(R) ENTRY DATE: The date selected by the Employer in Item
B(6)(d) of the Adoption Agreement, which shall be:
(1) The Effective Date of the Plan, for any Employee
who has satisfied the eligibility requirements set
forth in the Adoption Agreement;
(2) The first day of the month which coincides with or
immediately follows the date on which the Employee
satisfies the eligibility requirements set forth
in the Adoption Agreement;
(3) The first day of the Plan Year or the fourth,
seventh, or tenth month of the Plan Year which
coincides with or immediately follows the date on
which the Employee satisfies such eligibility
requirements;
(4) The first day of the Plan Year or the seventh
month of the Plan Year which coincides with or
immediately follows the date on which the Employee
satisfies such eligibility requirements;
(5) The first day of the Plan Year, but only if the
eligibility service requirements specified in Item
B(6)(d) are six months or less; or,
(6) As soon as practicable after the Employee
satisfies such eligibility requirements specified
in the Adoption Agreement, but in no event beyond
the date which would be six months following the
date on which the Employee first completes the
eligibility requirements specified in the Adoption
Agreement.
(S) ERISA: The Employee Retirement Income Security Act of
1974, as amended.
(T) HIGHLY COMPENSATED EMPLOYEE: The term Highly
Compensated Employee includes highly compensated active
employees and highly compensated former employees.
A highly compensated active employee includes any
Employee who performs service for the Employer during
the determination year and who, during the look-back
year: (i) received Compensation from the Employer in
excess of $75,000 (as adjusted pursuant to Section
415(d) of the Code); (ii) received Compensation from the
Employer in excess of $50,000 (as adjusted pursuant to
Section 415(d) of the Code) and was a member of the top-
paid group for such year; or (iii) was an officer of the
Employer and received Compensation during such year that
is greater than 50 percent of the dollar limitation in
6
effect under section 415(b)(1)(A) of the Code. The term
Highly Compensated Employee also includes: (i)
Employees who are both described in the preceding
sentence if the term "determination year" is substituted
for the term "look-back year" and the Employee is one of
the 100 Employees who receive the most compensation from
the Employer during the determination year; and (ii)
Employees who are 5 percent owners at any time during
the look-back year or determination year.
If no officer has satisfied the Compensation requirement
of (iii) above during either a determination year or
look-back year, the highest paid officer for such year
shall be treated as a Highly Compensated Employee.
For this purpose, the determination year shall be the
Plan Year. The look-back year shall be the twelve-month
period immediately preceding the determination year. A
highly compensated former employee includes any Employee
who separated from service (or was deemed to have
separated) prior to the determination year, performs no
service for the Employer during the determination year,
and was a highly compensated active employee for either
the separation year or any determination year ending on
or after the Employee's 55th birthday.
If an Employee is, during a determination year or look-
back year, a family member of either a 5 percent owner
who is an active or former employee or a Highly
Compensated Employee who is one of the 10 most Highly
Compensated Employees ranked on the basis of
Compensation paid by the Employer during such year, then
the family member and the 5 percent owner or top-ten
Highly Compensated Employee shall be aggregated. In
such case, the family member and 5 percent owner or top-
ten Highly Compensated Employee shall be treated as a
single employee receiving Compensation and Plan
contributions or benefits equal to the sum of such
Compensation and contributions or benefits of the family
member and 5 percent owner or top-ten Highly Compensated
Employee.
For purposes of this Section, family member includes the
Spouse, lineal ascendants and descendants of the
employee or former employee and the spouses of such
lineal ascendants and descendants.
The determination of who is a Highly Compensated
Employee, including the determinations of the number and
identity of Employees in the top-paid group, the top 100
Employees, the number of Employees treated as officers
and the Compensation that is considered, will be made in
7
accordance with Section 414(q) of the Code and the
regulations thereunder.
(U) HOUR OF SERVICE:
(1) Each hour for which an Employee is paid, or
entitled to payment, for the performance of duties
for the Employer. These hours shall be credited
to the Employee for the computation period in
which the duties are performed; and
(2) 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. No more than 501 Hours of
Service shall be credited under this paragraph for
any single continuous period (whether or not such
period occurs in a single computation period).
Hours under this paragraph shall be calculated and
credited pursuant to Section 2530.200b-2 of the
Department of Labor Regulations which are
incorporated herein by reference; and
(3) Each hour for which back pay, irrespective of
mitigation of damages, is either awarded or agreed
to by the Employer. The same Hours of Service
shall not be credited both under subparagraph (1)
or subparagraph (2), as the case may be, and under
this subparagraph (3). These hours shall be
credited to the Employee for the computation
period or periods to which the award or agreement
pertains rather than for the computation period in
which the award, agreement or payment is made.
Hours of Service will be credited for employment
with other members of an affiliated service group
(under Section 414(m)), a controlled group of
corporations (under Section 414(b)), or a group of
trades or businesses under common control (under
Section 414(c)) of which the adopting Employer is
a member, and any other entity required to be
aggregated with the Employer pursuant to Section
414(o).
Hours of Service will also be credited for any
individual considered an Employee for purposes of
this Plan under Sections 414(n) or 414(o).
8
(4) Where the Employer maintains the Plan of a
predecessor employer, service for such predecessor
employer shall be treated as service for the
Employer. If the Employer does not maintain the
Plan of a predecessor employer, the Plan does not
credit service with the predecessor employer,
unless the Employer identifies the predecessor in
its Adoption Agreement and specifies the purposes
for which the Plan will credit service with that
predecessor employer.
(5) Solely for purposes of determining whether a
Break-in-Service, as defined in Section 1.1(E),
for participation and vesting purposes has
occurred in a computation period, an individual
who is absent from work for maternity or paternity
reasons shall receive credit for the Hours of
Service which would otherwise have been credited
to such individual but for such absence, or in any
case in which such hours cannot be determined, 8
Hours of Service per day of such absence. For
purposes of this paragraph, an absence from work
for maternity or paternity reasons means an
absence (1) by reason of the pregnancy of the
individual, (2) by reason of a birth of a child of
the individual, (3) by reason of the placement of
a child with the individual in connection with the
adoption of such child by such individual, or (4)
for purposes of caring for such child for a period
beginning immediately following such birth or
placement. The Hours of Service credited under
this paragraph shall be credited (1) in the
computation period in which the absence begins if
the crediting is necessary to prevent a Break-in-
Service in that period, or (2) in all other cases,
in the following computation period.
(6) Hours of Service will be determined on the basis
of the method selected in the Adoption Agreement.
(V) INVESTMENT FUND: One of the funds provided for in
Section 10.7, and as selected by the Employer, as a
Named Fiduciary, on the Investment Fund Designation
portion of the Adoption Agreement.
(W) LEASED EMPLOYEE: 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
9
such services are of a type historically performed by
employees in the business field of the recipient
employer. Contributions or benefits provided a leased
employee by the leasing organization which 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 if: (i) such employee is covered by a
money purchase pension Plan providing: (1) a
nonintegrated employer contribution rate of at least 10
percent of compensation, as defined in Section 415(c)(3)
of the Code, but including amounts contributed pursuant
to a salary reduction agreement which are excludable
from the employee's gross income under Section 125,
Section 402(e)(3), Section 402(h)(1)(B) or Section
403(b) of the Code, (2) immediate participation, and (3)
full and immediate vesting; and (ii) leased employees do
not constitute more than 20 percent of the recipient's
nonhighly compensated workforce.
(X) NET PROFITS: Current and accumulated earnings of the
Employer before Federal and state taxes and
contributions to this and any other qualified Plan,
determined by the Employer in accordance with generally
accepted accounting principles.
(Y) NONHIGHLY COMPENSATED EMPLOYEE: An Employee of the
Employer who is neither a Highly Compensated Employee
nor a Family Member.
(Z) NORMAL RETIREMENT DATE: The date specified in the
Adoption Agreement at which a participant shall become
fully vested in his account balances, as provided for in
this document.
(AA) OWNER-EMPLOYEE: An individual who is a sole proprietor,
or who is a partner owning more than 10 percent of
either the capital or profits interest of the
partnership.
(BB) PAIRED PLANS: The Employer has adopted Plan #001 and
Plan #003, both using this basic Plan document, which
constitutes a set of "paired plans" as defined by the
Internal Revenue Service in Revenue Procedure 89-9, or
any successor thereto.
(CC) PARTICIPANT: A person who becomes eligible to
participate in accordance with the provisions of Article
II, and whose participation has not been terminated.
10
(DD) PERMITTED DISPARITY LEVEL: The level selected in the
Adoption Agreement, not to exceed the Taxable Wage Base
in effect at the beginning of the Plan Year. The
Taxable Wage Base is the contribution and benefit base
under section 230 of the Social Security Act at the
beginning of the year.
(EE) PERIOD OF SERVICE: The period beginning on the
Employee's Employment Commencement Date or Reemployment
Commencement Date, and ending on the date a Period of
Severance begins. The Employee will receive credit for
any Period of Service of less than 12 consecutive
months. Fractional periods of a year will be expressed
in days.
(FF) PERIOD OF SEVERANCE: A continuous period of time during
which the Employee is not employed by the Employer. A
Period of Severance begins on the date the Employee
retires, quits, or is discharged, or dies, or if
earlier, the twelve month anniversary of the date on
which the Employee was first absent from work for any
other reason; provided, that if an Employee is absent
from work for any other reason and retires, quits, is
discharged, or dies within 12 months, the Period of
Severance begins on the day the Employee quits, retires,
is discharged, or dies.
(GG) PLAN: This Plan established by the Employer as embodied
in this agreement and in the Adoption Agreement, and all
subsequent amendments thereto.
(HH) PLAN YEAR: The 12-consecutive month period designated
by the Employer in the Adoption Agreement. In the event
that the original Effective Date is not the first day of
the Plan Year, the first Plan Year shall be a short Plan
Year, beginning on the original Effective Date, and
ending on the last day of the Plan Year as specified in
the Adoption Agreement.
(II) QUALIFIED DISTRIBUTION DATE: For purposes of Section
7.13, the Qualified Distribution Date, if selected in
the Adoption Agreement, shall be the earliest retirement
date specified in Code Section 414(p) and shall operate
to allow a distribution to an Alternate Payee at the
time a domestic relations order is determined to be
qualified.
(JJ) REEMPLOYMENT COMMENCEMENT DATE: The date on which an
Employee completes an Hour of Service with the Employer
after a Break In Service or a Period of Severance.
11
(KK) RELATED EMPLOYERS: Any employer related to the Employer
as a controlled group of corporations (as defined in
Section Section 414(b) of the Code), a group of trades
or businesses (whether or not incorporated) which are
under common control (as defined in Section 414(c)) or
an affiliated service group (as defined in Section
414(m) or in Section 414(o) of the Code). If the
Employer is a member of a related group, the term
"Employer" includes the related group members for
purposes of crediting Hours of Service, determining
Years of Service and Breaks in Service under Article II,
applying participation and coverage testing, applying
the limitations on allocations in Section 6.6, applying
the top heavy rules and the minimum allocation
requirements of Article IX, the definitions of Employee,
Highly Compensated Employee, Compensation and Leased
Employee, and for any other purpose required by the
applicable Code section or by a Plan provision.
However, an Employer may contribute to the Plan only by
signing the Adoption Agreement or a Participation
Agreement to the Employer's Adoption Agreement. If one
or more of the Employer's related group members become
Participating Employers by executing a Participation
Agreement to the Employer's Adoption Agreement, the term
"Employer" includes the participating related group
members for all purposes of the Plan, and "Plan Admin-
istrator" means the Employer that is the signatory to
the Adoption Agreement.
If the Employer's Plan is a standardized Plan, all
Employees of the Employer or of any member of the
Employer's related group, are eligible to participate in
the Plan, irrespective of whether the related group
member directly employing the Employee is a
Participating Employer. If the Employer's Plan is a
nonstandardized Plan, the Employer must specify in Item
B(5) of its Adoption Agreement, whether the Employees of
related group members that are not Participating
Employers are eligible to participate in the Plan.
Under a nonstandardized Plan, the Employer may elect to
exclude from the definition of "Compensation" for
allocation purposes any Compensation received from a
related employer that has not executed a Participation
Agreement and whose Employees are not eligible to
participate in the Plan.
(LL) SELF-EMPLOYED INDIVIDUAL: An individual who has Earned
Income for the taxable year from the trade or business
for which the Plan is established; also, an individual
who would have had Earned Income but for the fact that
the trade or business had no Net Profits for the taxable
year.
12
(MM) SPOUSE: The person to whom the Participant is legally
married at the relevant time. Notwithstanding the
foregoing, if selected in the Adoption Agreement, Spouse
shall only refer to an individual to whom a Participant
has been married to for a period of at least one year,
ending at the relevant time.
(NN) STOCKHOLDER-EMPLOYEE: An employee or officer of an
electing small business (Subchapter S) corporation who
owns (or is considered as owning within the meaning of
Section 318(a)(1) of the Code), on any day during the
taxable year of such corporation, more than 5% of the
outstanding stock of the corporation.
(OO) TERMINATION DATE: The date on which a Participant's
employment is terminated as provided in Section 5.1.
(PP) TRUSTEE: The entity specified in Item B(17) of the
Adoption Agreement, which shall be any bank or trust
company which is affiliated with KeyCorp. within the
meaning of Section 1504 of the Code, each of which with
full trust powers, and its successors by merger or
reorganization.
(QQ) TRUST FUND: All assets held under the Plan by the
Trustee.
(RR) VALUATION DATE. The date on which the assets of the
Trust shall be valued, as provided for herein, with
earning or losses since the previous Valuation Date
being credited, as appropriate to Participant accounts.
Notwithstanding anything to the contrary in the Plan,
the Valuation date shall be each business day that the
Trustee and the New York Stock Exchange are each open
for business, provided, however, that the Trustee shall
not be obligated to value the Trust in the event,
through circumstances beyond its control, appropriate
prices may not be obtained for the assets held in the
Investment Funds.
(SS) VESTING COMPUTATION PERIOD. The Vesting Computation
Period shall be the 12-consecutive month period selected
by the Employer in the Adoption Agreement.
(TT) YEAR OF PARTICIPATION: For purposes of vesting, a
twelve (12) month period in which an Employee has a
balance in an account established under a 401(k)/401(m)
arrangement regardless of whether the Employee is
currently making contributions under the arrangement.
(UU) YEAR OF SERVICE: (i) If the elapsed time method of
crediting service is elected in the Adoption Agreement,
13
a Year of Service will mean a one-year Period of
Service. If the actual hours method of crediting
service is elected in the Adoption Agreement, a Year of
Service will mean a 12-consecutive month period as
specified in the Adoption Agreement during which the
Employee completes the number of Hours of Service (not
to exceed 1000) specified in the Adoption Agreement.
1.2 GENDER AND NUMBER. Unless the context indicates otherwise,
the masculine shall include the feminine, and the use of any
words herein in the singular shall include the plural and vice
versa.
1.3 CONTROL OF TRADES OR BUSINESSES BY OWNER-EMPLOYEE. If this
Plan provides contributions or benefits for one or more Owner-
Employees who control both the business for which this Plan is
established and one or more other trades or businesses, this
Plan and the Plan established for other trades or businesses
must, when looked at as a single Plan, satisfy Sections 401(a)
and (d) for the employees of this and all other trades or
businesses.
If the Plan provides contributions or benefits for one or more
Owner-Employees who control one or more other trades or
businesses, the employees of the other trades or businesses
must be included in a Plan which satisfies Sections 401(a) and
(d) and which provides contributions and benefits not less
favorable than provided for Owner-Employees under this Plan.
If an individual is covered as an Owner-Employee under the
plans of two or more trades or businesses which are not
controlled and the individual controls a trade or business,
then the contributions or benefits of the employees under the
Plan of the trades or businesses which are controlled must be
as favorable as those provided for him under the most
favorable Plan of the trade or business which is not
controlled.
For purposes of the preceding paragraphs, an Owner-Employee,
or two or more Owner-Employees, will be considered to control
a trade or business if the Owner-Employee, or two or more
Owner-Employees together:
(1) Own the entire interest in an unincorporated trade or
business, or
(2) In the case of a partnership, own more than 50 percent
of either capital interest or the profits interest in
the partnership.
For purposes of the preceding sentence, an Owner-
Employee, or two or more Owner-Employees shall be
14
treated as owning any interest in a partnership which is
owned, directly or indirectly, by a partnership which
such Owner-Employee, or such two or more Owner-
Employees, are considered to control within the meaning
of the preceding sentence.
ARTICLE II
ELIGIBILITY AND VESTING
2.1 ELIGIBILITY.
(A) PARTICIPATION. Every Employee who meets the eligibility
requirements specified by the Employer in the Adoption
Agreement shall become eligible to commence
participation in this Plan.
(B) COMMENCEMENT OF PARTICIPATION.
(1) For purposes of Money Purchase Pension Plans,
Profit Sharing Plans and 401(k) Plans with Profit
Sharing Contributions, each Eligible Employee
shall commence participation on the Entry Date.
(2) For purposes of 401(k) and 401(m) arrangements, an
Eligible Employee may, but is not required to,
enroll as a Participant as of the Entry Date on
which such Employee is initially eligible by
filing with the Committee before such date, an en-
rollment form prescribed by the Committee. The
time period for filing an enrollment form shall be
determined by the Committee. The form shall
include an authorization and request to the
Employer to deduct from such Participant's Com-
pensation in each pay period the designated After
Tax Contributions, and/or to reduce such
Participant's Compensation in each pay period by
the amount of the designated Before Tax
Contributions.
(C) YEARS OF SERVICE COUNTED TOWARDS ELIGIBILITY. All Years
of Service with the Employer are counted toward
eligibility except the following:
(1) In a Plan which (a) requires an Employee to
complete more than one Year of Service as an
eligibility requirement and (b) provides immediate
100% vesting in a Participant's Employer
Contribution Account after not more than two (2)
Years of Service, if an Employee has a 1-year
Break in Service before satisfying the Plan's
15
requirement for eligibility, service before such
break will not be taken into account.
(2) In the case of a Participant who does not have any
nonforfeitable right to the account balance
derived from Employer contributions, Years of
Service before a period of consecutive 1-year
Breaks in Service will not be taken into account
in computing eligibility service if the number of
consecutive 1-year Breaks in Service in such
period equals or exceeds the greater of 5 or the
aggregate number of Years of Service. Such
aggregate number of Years of Service will not
include any Years of Service disregarded under the
preceding sentence by reason of prior Breaks in
Service.
(3) If a Participant's Years of Service are
disregarded pursuant to the preceding paragraph,
such Participant will be treated as a new Employee
for eligibility purposes. If a Participant's
Years of Service may not be disregarded pursuant
to the preceding paragraph, such Participant shall
continue to participate in the Plan, or, if
terminated, shall participate immediately upon
reemployment.
(D) ELIGIBILITY BREAK IN SERVICE, ONE YEAR HOLD-OUT RULE.
If the Plan is a nonstandardized Plan, then:
(1) In the case of any Participant who has a 1-year
Break in Service or Severance, years of
eligibility service before such break will not be
taken into account until the Employee has
completed a Year of Service after returning to
employment.
(2) For plans in which the eligibility computation is
measured with reference to the Employment
Commencement Date, such Year of Service will be
measured beginning on the Employee's Reemployment
Commencement Date and, if necessary, subsequent
12-consecutive month periods beginning on
anniversaries of the Reemployment Commencement
Date.
(3) For plans which shift the Eligibility Computation
Period to the Plan Year, such Year of Service will
be measured by the 12-consecutive month period
beginning on the Employee's Reemployment
Commencement Date and, if necessary, Plan Years
beginning with the Plan Year which includes the
16
first anniversary of the Reemployment Commencement
Date.
(4) If a Participant completes a Year of Service in
accordance with this provision, his or her
participation will be reinstated as a Participant
as of the Reemployment Commencement Date.
(E) PARTICIPATION UPON RETURN TO ELIGIBLE CLASS.
(1) In the event a Participant is no longer a member
of an eligible class of Employees and becomes
ineligible to participate but has not incurred a
Break In Service, such Employee shall participate
immediately upon returning to an eligible class of
Employees. If such Participant incurs a Break In
Service eligibility will be determined under the
Break in Service rules of the Plan.
(2) In the event an Employee who is not a member of an
eligible class of Employees becomes a member of an
eligible class, such Employee will participate
immediately if such Employee has satisfied the
minimum age and service requirements and would
have otherwise previously become a Participant.
2.2 VESTING.
(A) VESTING SCHEDULE. In the case of an Employee who
terminates participation under this Plan for any reason
other than death, Disability or employment at the Normal
Retirement Date, such Participant, as of the last day of
his participation under this Plan, shall have a vested
interest in his Employer Contribution Account pursuant
to the formula specified by the Employer in the Adoption
Agreement.
(B) VESTING UPON NORMAL RETIREMENT DATE. Notwithstanding
the vesting schedule elected by the Employer in Items
B(7)(a) or C(4)(d) of the Adoption Agreement, an
Employee's right to his or her Employer Contribution
balance shall be nonforfeitable at the Employee's Normal
Retirement Date.
(C) VESTING BREAK IN SERVICE - 1 YEAR HOLDOUT. In the case
of any Participant who has incurred a 1-year Break in
Service, Years of Service before such break will not be
taken into account until the Participant has completed a
Year of Service after such Breaks in Service.
(D) VESTING FOR PRE-BREAK AND POST-BREAK ACCOUNT. In the
case of a Participant who has 5 or more consecutive 1-
17
year Breaks in Service, all service after such Breaks in
Service will be disregarded for the purpose of vesting
the employer-derived account balance that accrued before
such Breaks in Service. Such Participant's pre-break
service will count in vesting the post-break employer-
derived account balance only if either:
(1) such Participant has any nonforfeitable interest
in the account balance attributable to employer
contributions at the time of separation from
service; or
(2) upon returning to service the number of
consecutive 1-year Breaks in Service is less than
the number of Years of Service. Separate accounts
will be maintained for the Participant's pre-break
and post-break Employer Contribution Account
balance. Both accounts will share in the earnings
and losses of the Trust Fund.
(E) AMENDMENT OF VESTING SCHEDULE. If the Plan's vesting
schedule is amended, or the Plan is amended in any way
that directly or indirectly affects the computation of
the Participant's nonforfeitable percentage or if the
Plan is deemed amended by an automatic change to or from
a top-heavy vesting schedule, each Participant with at
least three (3) Years of Service with the Employer may
elect within a reasonable period after the adoption of
the amendment or change, to have the nonforfeitable
percentage computed under this Plan without regard to
such amendment or change. For Participants who do not
have at least 1 Hour of Service in any Plan Year
beginning after December 31, 1988, the preceding
sentence shall be applied by substituting "5 Years of
Service" for "3 Years of Service" where such language
appears.
This period during which the election may be made shall
commence with the date the amendment is adopted or deemed to
be made and shall end on the latest of:
(1) Sixty (60) days after the amendment is adopted;
(2) Sixty (60) days after the amendment becomes
effective; or
(3) Sixty (60) days after the Participant is issued
written notice of the amendment by the Employer or
Committee.
(F) AMENDMENT AFFECTING VESTED AND/OR ACCRUED BENEFITS. No
amendment to the Plan shall be effective to the extent
that it has the effect of decreasing a Participant's
accrued benefit. Notwithstanding the preceding
18
sentence, a Participant's account balance may be reduced
to the extent permitted under Section 412(c)(8) of the
Code. For purposes of this paragraph, a Plan amendment
which has the effect of decreasing a Participant's
account balance or eliminating an optional form of
benefit, with respect to benefits attributable to
service before the amendment shall be treated as
reducing an accrued benefit. Furthermore, if the
vesting schedule of a Plan is amended, in the case of an
Employee who is a Participant as of the later of the
date such amendment is adopted or the date it becomes
effective, the nonforfeitable percentage (determined as
of such date) of such Employee's Employer-derived
accrued benefit will not be less than the percentage
computed under the Plan without regard to such
amendment.
ARTICLE III
CODE 401(k) AND CODE 401(m) ARRANGEMENTS
3.1 PROVISION RELATING TO BOTH BEFORE TAX CONTRIBUTIONS AND AFTER
TAX CONTRIBUTIONS.
(A) DEFINITIONS. The following definitions are applicable
to this Article of the Plan.
(1) ACTUAL DEFERRAL PERCENTAGE OR ADP: for a
specified group of Participants for a Plan Year,
the average of the ratios (calculated separately
for each Participant in such group) of (1) the
amount of Employer contributions actually paid
over to the trust on behalf of such Participant
for the Plan Year to (2) the Participant's Com-
pensation for such Plan Year (whether or not the
Employee was a Participant for the entire Plan
Year, but limited to that portion of the Plan Year
in which the Employee was an Eligible Participant
if the Employer so elects for such Plan Year to so
limit Compensation for all Eligible Employees).
Employer contributions on behalf of any
Participant shall include (1) any Before Tax
Contributions made pursuant to the Participant's
deferral election, including Excess Before Tax
Contributions, but excluding Before Tax
Contributions that are taken into account in the
Contribution Percentage test (provided the ADP
test is satisfied both with and without exclusion
of these Before Tax Contributions); and (2) at the
election of the Employer, Qualified Non-elective
Contributions and Qualified Matching
Contributions. For purposes of computing Actual
19
Deferral Percentages, an Employee who would be a
Participant but for the failure to make Before Tax
Contributions shall be treated as a participant on
whose behalf no Before Tax Contributions are made.
(2) AFTER TAX CONTRIBUTIONS ("EMPLOYEE
CONTRIBUTIONS"): Any contribution made to the
Plan by or on behalf of a Participant that is
included in the Participant's gross income in the
year in which made and that is maintained under a
separate account to which earnings and losses are
allocated.
(3) AGGREGATE LIMIT: The sum of (i) 125 percent of
the greater of the ADP of the Non-highly
Compensated Employees for the Plan Year or the ACP
of Non-highly Compensated Employees under the Plan
subject to Code Section 401(m) for the Plan Year
beginning with or within the Plan Year of the cash
or deferred arrangement and (ii) the lesser of
200% or two plus the lesser of such ADP or ACP.
"Lesser" is substituted for "greater in "(i)",
above, and "greater" is substituted for "lesser"
after "two plus the" in "(ii) if it would result
in a larger Aggregate Limit.
(4) AVERAGE CONTRIBUTION PERCENTAGE OR ACP: the
average (expressed as a percentage) of the
Contribution Percentages of the Eligible
Participants in a group.
(5) BEFORE TAX CONTRIBUTIONS ("ELECTIVE DEFERRALS"):
Employer contributions made to the Plan at the
election of the Participant, in lieu of cash
compensation, which shall include contributions
made pursuant to a salary reduction agreement or
other deferral mechanism. With respect to any
taxable year, a Participant's Before Tax
Contributions are the sum of all Employer
contributions made on behalf of such Participant
pursuant to an election to defer under any
qualified cash or deferred arrangement as
described in Section 401(k) of the Code, any
simplified employee pension cash or deferred
arrangement as described in Code Section
402(h)(1)(B), any eligible deferred compensation
Plan under Code Section 457, any Plan as described
under Code Section 457, any Plan as described
under Code Section 501(c)(l 8), and any Employer
contributions made on behalf of a Participant for
the purchase of an annuity contract under Code
20
Section 403(b) pursuant to a salary reduction
agreement.
(6) CONTRIBUTION PERCENTAGE: The ratio (expressed as
a percentage) of the Participant's Contribution
Percentage Amounts to the Participant's
Compensation for the Plan Year (whether or not the
Employee was a Participant for the entire Plan
Year, but limited to that portion of the Plan Year
in which the Employee was an Eligible Participant
if the Employer so elects for such Plan Year to so
limit Compensation for all Eligible Employees).
(7) CONTRIBUTION PERCENTAGE AMOUNTS: The sum of the
After Tax Contributions, Matching Contributions,
and Qualified Matching Contributions (to the
extent not taken into account for purposes of the
ADP test) made under the Plan on behalf of the
Participant for the Plan Year. Such Contribution
Percentage Amounts shall not include Matching
Contributions that are forfeited either to correct
Excess Aggregate Contributions or because the
contributions to which they relate are Excess
Before Tax Contributions, Excess Contributions or
Excess Aggregate Contributions. If so elected in
the Adoption Agreement the Employer may include
Qualified Non-elective Contributions in the
Contribution Percentage Amounts. The Employer
also may elect to use Before Tax Contributions in
the Contribution Percentage Amounts so long as the
ADP test is met before the Before Tax
Contributions are used in the ACP test and
continues to be met following the exclusion of
those Before Tax Contributions that are used to
meet the ACP test.
(8) ELIGIBLE PARTICIPANT: Any Employee who is
eligible to make an After Tax Contribution or a
Before Tax Contribution (if the Employer takes
such contributions into account in the calculation
of the Contribution Percentage), or to receive a
Matching Contribution (including forfeitures) or a
Qualified Matching Contribution. If an After Tax
Contribution is required as a condition of
participation in the Plan, any Employee who would
be a Participant in the Plan if such Employee made
such a contribution shall be treated as an
eligible Employee on behalf of whom no After Tax
Contributions are made.
(9) EXCESS AGGREGATE CONTRIBUTIONS: With respect to
any Plan Year, the excess of:
21
(a) The aggregate Contribution Percentage Amounts
taken into account in computing the numerator
of the Contribution Percentage actually made
on behalf of Highly Compensated Employees for
such Plan Year, over
(b) The maximum Contribution Percentage Amounts
permitted by the ACP test (determined by
reducing contributions made on behalf of
Highly Compensated Employees in order of
their Contribution Percentages beginning with
the highest of such percentages).
Such determination shall be made after first
determining Excess Before Tax Contributions
pursuant to Section 3.2(D) and (E) and then
determining Excess Contributions pursuant to
section 3.2(F), (G) and (H).
(10) EXCESS BEFORE TAX CONTRIBUTIONS ("EXCESS ELECTIVE
DEFERRALS"): Those Before Tax Contributions that
are includible in a Participant's gross income under
Section 402(g) of the Code to the extent such
Participant's Before Tax Contributions for a taxable
year exceed the dollar limitation under such Code
section. Excess Before Tax Contributions shall be
treated as Annual Additions under the Plan, unless
such amounts are distributed no later than the first
April 15 following the close of the Participants
taxable year. Excess Before Tax Contributions shall
be adjusted for income or loss up to the end of the
taxable year of the Employee, and if elected in the
Adoption Agreement, for the income or loss
attributable to the period from the end of the
Employee's taxable year to the date of distribution
(the "Gap Period"). The income or loss allocable to
Excess Before Tax Contributions is (1) the income or
loss allocable to the Participant's Before Tax
Contribution Account for the taxable year multiplied
by a fraction, the numerator of which is such
Participant's Excess Before Tax Contributions for
the year and the denominator is the Participant's
account balance attributable to Before Tax
Contributions without regard to any income or loss
occurring during such taxable year plus, (2) if Gap
Period income or loss applies, ten percent of the
amount determined under (1) multiplied by the number
of whole calendar months between the end of the
Participant's taxable year and the date of
distribution, counting the month of distribution if
distribution occurs after the 15th of such month.
22
(11) EXCESS CONTRIBUTIONS: With respect to any Plan
Year, the excess of:
(a) The aggregate amount of Employer
contributions actually taken into account in
computing the ADP of Highly Compensated
Employee for such Plan Year, over
(b) The maximum amount of such contributions
permitted by the ADP test (determined by
reducing contributions made on behalf of
Highly Compensated Employee in order of the
ADPs, beginning with the highest of such
percentages).
(12) MATCHING CONTRIBUTIONS: An Employer contribution
made to this or any other defined contribution Plan
on behalf of a Participant on account of an After
Tax Contribution made by such Participant, or on
account of a Participant's Before Tax Contribution,
under a Plan maintained by the Employer.
(13) QUALIFIED MATCHING CONTRIBUTIONS: Matching
Contributions which are subject to the distribution
and nonforfeitability requirements under Section
401(k) of the Code when made. Qualified Matching
Contributions shall be allocated, in the discretion
of Employer, to the accounts of all Employees, or
only to the accounts of Non-highly Compensated
Employees.
(14) QUALIFIED NON-ELECTIVE CONTRIBUTIONS: Contributions
(other than Matching Contributions or Qualified
Matching Contributions) made by the Employer and
allocated to Participants' accounts that the
Participants may not elect to receive in cash until
distributed from the Plan; that are nonforfeitable
when made; and that are distributable only in
accordance with the distribution provisions that are
applicable to Before Tax Contributions and Qualified
Matching Contributions. Qualified Non-elective
Contributions shall be allocated, in the discretion
of Employer, to the accounts of all Employees, or
only to the accounts of Non-highly Compensated
Employees.
(B) NONFORFEITABILITY AND VESTING. The Participant's accrued
benefits derived from Before Tax Contributions and After
Tax Contributions are nonforfeitable and fully vested.
(C) NOTICE TO COMMITTEE. The Committee shall set the time
period during which a Participant may provide written
23
notice to increase, decrease or terminate Before Tax
Contributions and After Tax Contributions.
(D) SUSPENSION AFTER RECEIPT OF HARDSHIP DISTRIBUTION. If the
Employer has elected in the Adoption Agreement to have the
"safe harbor" hardship rules apply, an Employee's Before
Tax Contributions and After Tax Contributions shall be
suspended for twelve months after the receipt by such
Employee of a Hardship distribution (as defined in Section
3.9) from this Plan or any other Plan maintained by the
Employer.
(E) SEPARATE ACCOUNTS. Separate accounts for Before Tax
Contributions and After Tax Contributions will be
maintained for each Participant. Each account will be
credited with the applicable contributions and earnings
thereon.
3.2 BEFORE TAX CONTRIBUTIONS. (ELECTIVE DEFERRALS).
(A) ALLOCATION OF BEFORE TAX CONTRIBUTIONS. If the Employer
selects Item C(2) in the Adoption Agreement, for each Plan
Year the Employer will contribute and allocate to each
Participant's Before Tax Contribution Account an amount
equal to the amount of the Participant's Before Tax
Contributions. The provisions of the cash or deferred
arrangement may be made effective as of the first day of
the Plan Year in which the cash or deferred option is
adopted, however, under no circumstances may a salary
reduction agreement or other deferral mechanism be adopted
retroactively. Before Tax Contributions must be
contributed and allocated to the Plan no later than thirty
(30) days after the close of the Plan Year for which the
contributions are deemed to be made, or such other time as
provided in applicable regulations under the Code.
(B) BEFORE TAX CONTRIBUTIONS PURSUANT TO A SALARY REDUCTION
AGREEMENT. To the extent provided in the Adoption
Agreement, a Participant may elect to have Before Tax
Contributions made under this Plan. Before Tax
Contributions shall be continuing contributions through
payroll deduction made pursuant to a salary reduction
agreement.
(1) COMMENCEMENT OF BEFORE TAX CONTRIBUTIONS. An
Employee may elect to commence Before Tax
Contributions as of his or her Entry Date as
described in Section 2.1(B). Such election shall
not become effective before the Entry Date. Such
election may not be made retroactively.
24
(2) MODIFICATION AND TERMINATION OF BEFORE TAX
CONTRIBUTIONS. A Participant's election to commence
Before Tax Contributions shall remain in effect
until modified or terminated. A Participant may
increase or decrease his or her Before Tax
Contributions as of any date as selected by the
Employer in Item C(3) of the Adoption Agreement upon
notice to the Committee. A Participant may
terminate his or her election to make Before Tax
Contributions as of the Participant's next wage
payment date upon notice to the Committee. Any
Participant who terminates Before Tax Contributions
may elect to recommence making Before Tax
Contributions as of the date selected by the
Employer in Item C(3) of the Adoption Agreement
following his or her suspension of contributions.
(C) CASH BONUSES. If Item C(2)(c) of the Adoption Agreement
is selected, a Participant may also enter into a salary
reduction agreement on cash bonuses that, directing that
the amount of such salary reduction be contributed to the
Plan as a Before Tax Contribution, or received by the
Participant in cash. A Participant shall be afforded a
reasonable period to elect to defer amounts described in
this Section 3.2 to the Plan. Such election shall not
become effective before the Participant's Entry Date.
(D) MAXIMUM AMOUNT OF BEFORE TAX CONTRIBUTIONS. A
Participant's Before Tax Contributions are subject to any
limitations imposed in Item C(2) of the Adoption
Agreement, calculated on an annual basis, and any further
limitations under the Plan. No Participant shall be
permitted to have Before Tax Contributions made under this
Plan, or any other qualified Plan maintained by the
Employer, during any taxable year in excess of the dollar
limitation contained in Code Section 402(g) in effect at
the beginning of such taxable year. Furthermore, if an
Employee receives a Hardship distribution (as defined in
section 3.9, utilizing the "safe harbor" rules) from this
Plan or any other Plan maintained by the Employer, the
Employee may not make Before Tax Contributions for the
Employee's taxable year immediately following the taxable
year of the Hardship distribution in excess of the
applicable limit under Section 402(g) of the Code for such
taxable year less the amount of the Employee's Before Tax
Contributions for the taxable year of the Hardship
distribution.
(E) DISTRIBUTION OF EXCESS BEFORE TAX CONTRIBUTIONS. If a
Participant makes Before Tax Contributions to this Plan
and to another Plan, and the Participant has made Excess
Before Tax Contributions to one or more of the plans, the
26
Participant may assign the amount of any such Excess
Before Tax Contributions among the plans under which such
Before Tax Contributions were made. The Participant may
assign to this Plan any Excess Before Tax Contributions
made during a taxable year of the Participant to this Plan
by notifying the Committee on or before the date specified
in the Adoption Agreement of the amount of the Excess
Before Tax Contributions to be assigned to the Plan. A
Participant is deemed to notify the Committee of any
Excess Before Tax Contributions that arise by taking into
account only those Before Tax Contributions made under the
Plan or Plans of this Employer.
Notwithstanding any other provision of the Plan, Excess
Before Tax Contributions, plus any income and minus any
loss allocable thereto, shall be distributed no later than
April 15 to any Participant to whose account Excess Before
Tax Contributions were assigned for the preceding year and
who claims Excess Before Tax Contributions for such
taxable year.
The Participant's claim shall be in writing; shall be
submitted to the Committee not later than the date elected
in Item CC of the Adoption Agreement; shall specify the
amount of the Participant's Excess Before Tax Contribution
for the preceding calendar year; and shall be accompanied
by the Participant's written statement that if such
amounts are not distributed, such Excess Before Tax
Contributions, 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.
(F) ACTUAL DEFERRAL PERCENTAGE. The ADP for Participants who
are Highly Compensated Employees for each Plan Year and
the ADP for Non-highly Compensated Employees for the same
Plan Year must satisfy one of the following tests:
(1) 1.25 LIMIT. The ADP for Participants who are Highly
Compensated Employees for the Plan Year shall not
exceed the ADP for Participants who are Non-highly
Compensated Employees for the same Plan Year
multiplied by 1.25; or
(2) 2.0 LIMIT. The ADP for Participants who are Highly
Compensated Employees for the Plan Year shall not
exceed the ADP for Participants who are Non-highly
Compensated Employees for the same Plan Year
multiplied by 2.0, provided that the ADP for
Participants who are Highly Compensated Employees
does not exceed the ADP for Participants who are
26
Non-highly Compensated Employees by more than two
(2) percentage points.
(3) SPECIAL RULES.
(a) The ADP for any Participant who is a Highly
Compensated Employee for the Plan Year and
who is eligible to have Before Tax
Contributions (and Qualified Non-elective
Contributions, or Qualified Matching
Contributions, or both, if treated as
Elective Deferrals for purposes of the ADP
test) allocated to his or her accounts under
two or more arrangements described in Section
401(k) of the Code, that are maintained by
the Employer, shall be determined as if such
Before Tax Contributions (and, if applicable,
such Qualified Non-elective Contributions or
Qualified Matching Contributions, or both,)
were made under a single arrangement. If a
Highly Compensated Employee participates in
two or more cash or deferred arrangements
that have different Plan Years, all cash or
deferred arrangements ending with or within
the same calendar year shall be treated as a
single arrangement.
(b) In the event that this Plan satisfies the
requirements of Sections 401(k), 401(a)(4),
or 410(b) of the Code only if aggregated with
one or more other plans, or if one or more
other plans satisfy the requirements of such
Sections of the Code only if aggregated with
this Plan, then this section shall be applied
by determining the ADP of Employees as if all
such plans were a single Plan. For Plan
Years beginning after December 31, 1989,
plans may be aggregated in order to satisfy
Section 401(k) of the Code only if they have
the same Plan Year.
(c) For purposes of determining the ADP of a
Participant who is a 5-percent owner or one
of the ten most highly-paid Highly
Compensated Employees, the Before Tax
Contributions (and Qualified Non-elective
Contributions or Qualified Matching
Contributions, or both, if treated as Before
Tax Contributions for purposes of the ADP
test) and Compensation of such Participant
shall include the Before Tax Contributions
(and, if applicable, Qualified Non-elective
27
Contributions) and Compensation for the Plan
Year of Family Members (as defined in Section
414(q)(6) of the Code). Family Members, with
respect to such Highly Compensated Employees,
shall be disregarded as separate employees in
determining the ADP both for Participants who
are Non-highly Compensated Employees and for
Participants who are Highly Compensated
Employees.
(d) For purposes of determining the ADP test,
Before Tax Contributions if treated as Before
Tax Contributions and Qualified Non-elective
Contributions must be made before the last
day of the twelve-month period immediately
following the Plan Year to which
contributions relate.
(e) The Employer shall maintain records
sufficient to demonstrate satisfaction of the
ADP test and the amount of Qualified Non-
elective Contributions used in such test.
(f) The determination and treatment of the ADP
amounts of any Participant shall satisfy such
other requirements as may be prescribed by
the Secretary of the Treasury.
(G) DISTRIBUTION OF EXCESS CONTRIBUTIONS. Notwithstanding any
other provision of the Plan, Excess Contributions, plus
any income and minus any loss allocable thereto, shall be
distributed no later than the last day of each Plan Year
to Participants to whose accounts Excess Contributions
were allocated for the preceding Plan Year. If such
excess amounts are distributed more than 2-1/2 months
after the last day of the Plan Year in which such excess
amounts arose, a ten (10) percent excise tax will be
imposed on the Employer maintaining the Plan with respect
to such amounts. Such distributions shall be made to
Highly Compensated Employees on the basis of the
respective portions of the Excess Contributions
attributable to each of such Employees. Excess
Contributions of Participants who are subject to the
Family Member aggregation rules shall be allocated among
the Family Members in proportion to the Before Tax
Contributions (and amounts treated as Before Tax
Contributions) of each Family Member that is combined to
determine the combined ADP.
Excess Contributions (including the amounts
recharacterized) shall be treated as Annual Additions
under the Plan.
28
(1) DETERMINATION OF INCOME OR LOSS. The Excess
Contributions shall be adjusted for income or loss
up to the date of distribution. The income or loss
allocable to Excess Contributions is (1) the income
or loss allocable to the Participant's Before Tax
Contribution Account (and, if applicable, the
Qualified Non-elective Contribution Account or the
Qualified Matching Contribution Account or both)
multiplied by a fraction, the numerator of which is
such Participant's Excess Contribution for the year
and the denominator is the Participant's account
balance attributable to Before Tax Contributions
(and Qualified Non-Elective Contributions or
Qualified Matching Contributions or both, if any of
such contributions are included in the ADP test)
without regard to any income or loss occurring
during such taxable year, plus, (2) if Gap Period
income or loss applies, as elected in the Adoption
Agreement, ten percent of the amount determined
under (1) multiplied by the number of whole calendar
months between the end of the Plan Year and the date
of distribution, counting the month of distribution
if distribution occurs after the 15th of such month.
(2) ACCOUNTING FOR EXCESS CONTRIBUTIONS. Excess
Contributions shall be distributed from the
Participant's Before Tax Contribution Account and
Qualified Matching Contribution Account (if
applicable) in proportion to the Participant's
Before Tax Contributions and Qualified Matching
Contributions (to the extent used in the ADP test)
for the Plan Year. Excess Contributions shall be
distributed from the participant's Qualified Non-
elective Contribution Account only to the extent
that such Excess Contributions exceed the balance in
the Participant's Before Tax Contribution Account.
(H) RECHARACTERIZATION. If the Plan permits After Tax
Contributions (Employee Contributions), Excess
Contributions may be recharacterized pursuant to this
subsection. Recharacterized amounts may be used in the
Plan from which Excess Contributions arose or in another
Plan of the employer with the same Plan Year.
(1) TREATMENT OF AMOUNTS RECHARACTERIZED. A Participant
may treat his or her Excess Contributions as an
amount distributed to the Participant and then
contributed by the Participant to the Plan.
Recharacterized amounts will remain nonforfeitable
and subject to the same distribution requirements as
Before Tax Contributions. Amounts may not be
recharacterized by a Highly Compensated Employee to
29
the extent that such amount in combination with
other After Tax Contributions made by that Employee
would exceed any stated limit under the Plan on
After Tax C Contributions.
(2) TIMING OF RECHARACTERIZATION. Recharacterization
must occur no later than two and one-half months
after the last day of the Plan Year in which such
Excess Contributions arose and is deemed to occur no
earlier than the date the last Highly Compensated
Employee is informed in writing of the amount
recharacterized and the consequences thereof.
Recharacterized amounts will be taxable to the
Participant for the Participant's tax year in which
the Participant would have received them in cash.
(I) ADJUSTMENTS TO BEFORE TAX CONTRIBUTION PERCENTAGES.
Anything to the contrary in this Article III
notwithstanding, the Committee shall have the right to
reduce the percentages designated pursuant to Section
3.2(B), of any one or more Highly Compensated Employees in
a manner prescribed or approved by the Committee to the
extent necessary or convenient to ensure that at least one
of the ADP tests set forth in Section 3.2(F) is satisfied,
but in no event shall such reduction result in a
percentage less than zero. Any such reduction shall be
effected quarterly, or more frequently as the Committee
may determine and each affected Highly Compensated
Employee shall be deemed to have elected the permissible
percentage determined by the Committee. The Committee
may, on a prospective basis, and subject to the percentage
limits of Section 3.3 below, treat amounts contributed to
the Plan pursuant to a salary reduction agreement as After
Tax Contributions by each affected Highly Compensated
Employee; provided that if any such reduction cannot be so
treated because of the said percentage limits or because
of the nondiscrimination requirements of Code Section
401(m) or otherwise, then the amount of such reduction
(and any income allocable thereto) shall be distributed to
each affected Highly Compensated Employee pursuant to Code
Section 401(k)(8) or Code Section 401(m)(6), if
applicable, not later than the close of the first 2-1/2
months of the Plan Year following the Plan Year in which
the contribution was made.
3.3 AFTER TAX CONTRIBUTIONS. (EMPLOYEE CONTRIBUTIONS).
(A) ALLOCATION OF AFTER TAX CONTRIBUTIONS. If the Employer
selects Item C(2)(b) in the Adoption Agreement, the
Employer will deduct from the Participant's pay and
allocate to each Participant's After Tax Contribution
Account an amount equal to the percentage of Compensation
30
authorized by the Participant as an After Tax
Contribution. The Employer shall transmit After Tax
Contributions to the Trustee within thirty (30) days after
the month end in which such deductions are made.
(B) EMPLOYEE AUTHORIZES AFTER TAX CONTRIBUTIONS. To the
extent provided in the Adoption Agreement, a Participant
may elect to make After Tax Contributions under the Plan.
(1) ELECTION TO MAKE AFTER TAX CONTRIBUTIONS. An
Employee may elect to make After Tax Contributions
as of his or her Entry Date as described in Section
2.1(B). Such election will not become effective
before the Entry Date.
(2) MODIFICATION AND TERMINATION OF AFTER TAX
CONTRIBUTIONS. A Participant's election to commence
After Tax Contributions shall remain in effect until
modified or terminated. A Participant may increase
or decrease his or her After Tax Contributions as
selected by the Employer in Item C(3) of the
Adoption Agreement upon written notice to the
Committee. A Participant may terminate his or her
election to make After Tax Contributions at any time
as of the Participant's next wage payment date upon
written notice to the Committee. Any Participant
who terminates After Tax Contributions may elect to
recommence making After Tax Contributions as of the
date selected by the Employer in Item C(3) of the
Adoption Agreement following his or her suspension
of contributions.
(C) MAXIMUM AMOUNT OF AFTER TAX CONTRIBUTIONS. A
Participant's After Tax Contributions are subject to any
limitations imposed in Item C(3) of the Adoption
Agreement, calculated on an annual basis, and any further
limitations under the Plan.
(D) CASH BONUSES. If Item C(2)(c) of the Adoption Agreement
is selected, a Participant may also enter into a salary
reduction agreement on cash bonuses, directing that the
amount of such salary reduction be contributed to the Plan
as an After Tax Contribution, or received by the
Participant in cash. A Participant shall be afforded a
reasonable period to elect to defer amounts described in
this Section 3.3 to the Plan. Such election shall not
become effective before the Participant's Entry Date.
3.4 EMPLOYER CONTRIBUTIONS.
(A) MATCHING CONTRIBUTIONS. If elected by the Employer in the
Adoption Agreement, the Employer will or may make Matching
31
Contributions to the Plan. The amount of such Matching
Contributions shall be calculated by reference to the
Participants' Before Tax Contributions and/or After Tax
Contributions as specified by the Employer in the Adoption
Agreement.
(B) QUALIFIED MATCHING CONTRIBUTIONS. If elected by the
Employer in the Adoption Agreement, the Employer may make
Qualified Matching Contributions to the Plan.
In addition, in lieu of distributing Excess Contributions
as provided in Section 3.2(G) of the Plan, or Excess
Aggregate Contributions as provided in Section 3.5(C) of
the Plan, the Employer may make Qualified Matching
Contributions on behalf of Employees that are sufficient
to satisfy either the Actual Deferral Percentage or the
Average Contribution Percentage test, or both, pursuant to
regulations under the Code.
(C) QUALIFIED NON-ELECTIVE CONTRIBUTIONS. If elected by the
Employer in the Adoption Agreement, the Employer may make
Qualified Non-elective Contributions to the Plan.
In addition, in lieu of distributing Excess Contributions
as provided in Section 3.2(G) of the Plan, or Excess
Aggregate Contributions as provided in Section 3.5(C) of
the Plan, the Employer may make Qualified Non-elective
Contributions on behalf of Employees that are sufficient
to satisfy either the Actual Deferral Percentage or the
Average Contribution Percentage test, or both, pursuant to
regulations under the Code.
(D) SEPARATE ACCOUNTS. An Employer Matching Account shall be
maintained for a Participant's accrued benefit
attributable to Matching Contributions. A Qualified
Matching Contribution Account shall be maintained for a
Participant's accrued benefit attributable to Qualified
Matching Contributions. A Qualified Non-elective
Contribution Account shall be maintained for a
Participant's accrued benefit attributable to Qualified
Non-elective Contributions. Such accounts shall be
credited with the applicable contributions, earnings and
losses, distributions, and other adjustments.
(E) VESTING. Matching Contributions will be vested in
accordance with the Employer's election in Items C(4)(d)
and C(4)(e) of the Adoption Agreement. In any event,
Matching Contributions shall be fully vested at Normal
Retirement Date, upon the complete or partial termination
of the Plan, or upon the complete discontinuance of
Matching Contributions, as applicable. Qualified Non-
32
elective Contributions and Qualified Matching
Contributions are nonforfeitable when made.
(F) FORFEITURES. Forfeitures of Matching Contributions shall
be used to reduce such contributions, or shall be
allocated to Participants, in accordance with the
Employer's election in Item C(6) of the Adoption
Agreement.
(G) ALLOCATION OF DISCRETIONARY MATCHING CONTRIBUTIONS. If
the Employer selects Item C(4)(b) in the Adoption
Agreement, any discretionary Matching Contributions shall
be allocated as of the allocation date specified in Item
C(4)(c)(ii) of the Adoption Agreement, to the Employer
Matching Account of each Participant who has made Before
Tax Contributions and/or After Tax Contributions eligible
for matching. If Item C(4)(c)(ii)(e) has been selected
(imposing a last day of the Plan Year requirement) the
allocation shall be made to a Participant who (1) if a
Participant in a nonstandardized Plan, is employed or on
leave of absence on the last day of the Plan Year, and (2)
if a Participant in a standardized Plan, either completes
more than 500 Hours of service during the Plan Year or is
employed on the last day of the Plan Year. The following
Participants will also share in the Matching Contributions
for the year, if elected in the Adoption Agreement: (1)
Participants in a nonstandardized Plan whose employment
terminated before the end of the Plan Year because of
retirement, death, disability or as specified in the
Adoption Agreement, and (2) Participants in a standardized
Plan whose employment terminated before the end of the
Plan Year because of retirement, death, disability or as
specified in the Adoption Agreement, and completed 500
Hours of Service or less. Notwithstanding the foregoing,
if the Employer makes a contribution prior to the end of
the Plan Year, Participants shall be entitled to an
allocation of that contribution when made, without regard
to any end of the Plan Year requirement.
(H) LIMITATION ON EMPLOYER CONTRIBUTIONS. The Employer's
contributions for any Plan Year shall not exceed the
maximum amount which the Employer may deduct pursuant to
Section 404 of the Code.
3.5 LIMITATIONS ON AFTER TAX CONTRIBUTIONS (EMPLOYEE CONTRIBUTIONS)
AND MATCHING CONTRIBUTIONS.
(A) Contribution Percentage. The ACP for Participants who are
Highly Compensated Employees for each Plan Year and the
ACP for Participants who are Non-highly Compensated
Employees for the same Plan Year must satisfy one of the
following tests:
33
(1) 1.25 LIMIT. The ACP for Participants who are Highly
Compensated Employees for the Plan Year shall not
exceed the ACP for Participants who are Non-highly
Compensated Employees for the same Plan Year by
1.25, or
(2) 2.0 LIMIT. The ACP for Participants who are Highly
Compensated Employees for the Plan Year shall not
exceed the ACP for Participants who are Non-highly
Compensated Employees for the same Plan Year
multiplied by two (2), provided that the ACP for
Participants who are Highly Compensated Employees
does not exceed the ACP for Participants who are
Non-highly Compensated Employees by more than two
(2) percentage points.
(B) SPECIAL RULES.
(1) MULTIPLE USE. If one or more Highly Compensated
Employees participate in both a cash or deferred
arrangement and a Plan subject to the ACP test
maintained by the Employer and th the sum of the ADP
and ACP of those Highly Compensated Employees
subject to either or both tests exceeds the
Aggregate Limit, then the ACP of those Highly
Compensated Employees who also participate in a cash
or deferred arrangement will be reduced (beginning
with such Highly Compensated Employee whose ACP is
the highest) so that the limit is not exceeded. The
amount by which each Highly Compensated Employee's
Contribution Percentage amounts is reduced shall be
treated as an Excess Aggregate Contribution. The
ADP and ACP of the Highly Compensated Employees are
determined after any corrections required to meet
the ADP and ACP tests. Multiple use does not occur
if either the ADP and ACP of the Highly Compensated
Employees does not exceed 1.25 multiplied by the ADP
and ACP of the Non-highly Compensated Employees.
(2) AGGREGATION OF CONTRIBUTION PERCENTAGES. For
purposes of this section, the Contribution
Percentage for any Participant who is a Highly
Compensated Employee and who is eligible to have
Contribution Percentage Amounts allocated to his or
her accounts under two or more plans described in
Section 401(a) of the Code, or arrangements
described in Section 401(k) of the Code, that are
maintained by the Employer, shall be determined as
if the total of such Contribution Percentage Amounts
was made under each Plan. If a Highly Compensated
Employee participates in two or more cash or
deferred arrangements that have different Plan years
34
all cash or deferred arrangements ending with or
within the same calendar year shall be treated as a
single arrangement. Notwithstanding the foregoing,
certain plans shall be treated as separate if
mandated to be disaggregated under regulations under
Section 401(m) of the Code.
(3) AGGREGATION OF PLANS. In the event that this Plan
satisfies the requirements of Sections 401(m),
401(a)(4) or 410(b) of the Code only if aggregated
with one or more other plans, or if one or more
other plans satisfy the requirements of such
sections of the Code only if aggregated with this
Plan, then this section shall be applied by
determining the Contribution Percentage of Employees
as if all such plans were a single Plan. For Plan
Years beginning after December 31, 1989, plans may
be aggregated in order to satisfy Section 401(m) of
the Code only if they have the same Plan Year.
(4) FAMILY AGGREGATION. For purposes of determining the
Contribution Percentage of a Participant who is a
five-percent owner or one of the ten most highly-
paid Highly Compensated Employees, the Contribution
Percentage Amounts and Compensation of such Employee
shall include the Contribution Percentage Amounts
and Compensation for the Plan Year of Family
Members, as defined in Section 414(q)(6) of the
Code. Family Members, with respect to Highly
Compensated Employees, shall be disregarded as
separate employees in determining the Contribution
Percentage both for Participants who are Non-highly
Compensated Employees and for Participants who are
Highly Compensated Employees.
(5) TIME OF CONTRIBUTIONS. For purposes of determining
the Contribution Percentage test, After Tax
Contributions are considered to have been made in
the Plan Year in which contributed to the Trust.
Matching Contributions and Qualified Non-elective
Contributions will be considered made for a Plan
Year if made no later than the end of the twelve-
month period beginning on the day after the close of
the Plan Year.
(6) RECORDS. The Employer shall maintain records
sufficient to demonstrate satisfaction of the ACP
test and the amount of Qualified Non-elective
Contributions or Qualified Matching Contributions,
or both, used in such test.
35
(7) REGULATIONS. The determination and treatment of the
Contribution Percentage of any Participant shall
satisfy such other requirements as may be prescribed
by the Secretary of the Treasury.
(C) DISTRIBUTION OF EXCESS AGGREGATE CONTRIBUTIONS.
(1) GENERAL RULE. Notwithstanding any other provision
of this Plan, Excess Aggregate Contributions, plus
any income and minus any loss allocable thereto,
shall be forfeited, if forgettable, or if not
forgettable, distributed no later than the last day
of each Plan Year to Participants to whose accounts
Excess Aggregate Contributions were allocated for
the preceding Plan Year. Excess Aggregate
Contributions of Participants who are subject to the
Family Member aggregation rules shall be allocated
among the Family Members in proportion to the After
Tax and Matching Contributions (or amounts treated
as Matching Contributions) of each Family Member
that is combined to determine the combined ACP. If
such Excess Aggregate Contributions are distributed
more than 2-1/2 months after the last day of the
Plan Year in which such excess amounts arose, a ten
(10) percent excise tax will be imposed on the
Employer maintaining the Plan with respect to those
amounts. Excess Aggregate Contributions shall be
treated as Annual Additions under the Plan.
(2) DETERMINATION OF INCOME OR LOSS. Excess Aggregate
Contributions shall be adjusted for income or loss
up to the date of distribution. The income or loss
allocable to Excess Aggregate Contributions is the
sum of: (1) income or loss allocable to the
Participant's After Tax Contribution Account,
Matching Contribution Account, Qualified Matching
Contribution Account, (if any, and if all amounts
therein are not used in the ADP test) and, if
applicable, the Qualified Non-elective Contribution
Account and Before Tax Contribution Account for the
Plan Year multiplied by a fraction, the numerator of
which is such Participant's Excess Aggregate
Contributions for the year and the denominator is
the Participant's account balance(s) attributable to
Contribution Percentage Amounts without regard to
any income or loss occurring during such Plan Year;
and (2) ten percent of the amount determined under
(1) multiplied by the number of whole calendar
months between the end of the Plan Year and the date
of distribution, counting the month of distribution
if distribution occurs after the 15th of such month.
36
(3) FORFEITURES OF EXCESS AGGREGATE CONTRIBUTIONS.
Forfeitures of Excess Aggregate Contributions may
either be reallocated to the accounts of Non-Highly
Compensated Employees or applied to reduce Employer
Contributions, as elected by the Employer in Item
C(6)(c) of the Adoption Agreement.
(4) ACCOUNTING FOR EXCESS AGGREGATE CONTRIBUTIONS.
Excess Aggregate Contributions shall be forfeited,
if forgettable, or distributed on a pro-rata basis
from the Participant's After Tax Contribution
Account and Matching Contribution Account and
Qualified Matching Contribution Account (and, if
applicable, the Participant's Qualified Non-elective
Contribution Account and Before Tax Contribution
Account, or both).
3.6 NET PROFITS NOT REQUIRED IF SO ELECTED IN ADOPTION AGREEMENT.
If the Employer elects, Matching Contributions may be made
without regard to Net Profits in accordance with Item
C(4)(c)(iii) of the Adoption Agreement. If the Plan is a
profit-sharing Plan, the Plan shall continue to be designed to
qualify as a profit-sharing Plan for purposes of Sections
401(a), 402, 412, and 417 of the Code. Net Profits shall not
be required for Before Tax Contributions or After Tax
Contributions to be made to the Plan.
3.7 FORM, PAYMENT AND ALLOCATION OF CONTRIBUTIONS. All
contributions under this Article III made for a Plan Year shall
be made in cash, and shall be delivered to the Trustee at such
time or times as shall be agreed upon between the Committee and
the Trustee. The Committee shall instruct the Trustee as to
the allocation of contributions to the Participant's accounts.
3.8 DISTRIBUTION REQUIREMENTS FOR BEFORE TAX CONTRIBUTION ACCOUNT.
Before Tax Contributions, Qualified Non-elective Contributions
and Qualified Matching Contributions, and income allocable to
each are not distributable to a Participant or his or her
Beneficiary or Beneficiaries, in accordance with such
Participant's, Beneficiary's or Beneficiaries' election,
earlier than upon separation from service, death, disability,
or as selected in the Adoption Agreement. Such amounts may not
be distributed unless in accordance with the Participant's
election made pursuant to rules established by the Committee as
authorized in the Adoption Agreement, and upon:
(A) Termination of the Plan without the establishment of
another defined contribution Plan, other than an employee
stock ownership Plan (as defined in Section 4975(e) or
Section 409 of the Code) or a simplified employee pension
Plan as defined in Section 408(k).
37
(B) The disposition by a corporation to an unrelated
corporation of substantially all of the assets (within the
meaning of Section 409(d)(2) of the Code) used in a trade
or business of such corporation if such corporation
continues to maintain this Plan after the disposition, but
only with respect to Employees who continue employment
with the corporation acquiring such assets.
(C) The disposition by a corporation to an unrelated entity of
such corporation's interest in a subsidiary (within the
meaning of Section 409(d)(3) of the Code) if such
corporation continues to maintain this Plan, but only with
respect to Employees who continue employment with such
subsidiary.
(D) The attainment of age 59-1/2 in the case of a profit-
sharing Plan, or the attainment of the Plan's Normal
Retirement Date, if either or both are selected in the
Adoption Agreement.
(E) The Hardship of the Participant as described in Section
3.9, if selected in the Adoption Agreement.
All distributions that may be made pursuant to one or more
of the foregoing distributable events are subject to the
spousal and Participant consent requirements (if
applicable) contained in Sections 411(a)(11) and 417 of
the Code. In addition, distributions after March 31,
1988, that are triggered by any of the first three events
above, in Sections 3.8(A), (B) and (C) must be made in a
lump sum.
3.9 HARDSHIP DISTRIBUTION.
(A) AMOUNT AVAILABLE FOR WITHDRAWAL. Upon the written request
of a Participant received and approved by the Committee, a
Participant may withdraw, in cash, up to one hundred per
cent (100%) of the amount of such Participant's Before Tax
Contributions (and any earnings credited to a
Participant's account as of the end of the last Plan Year
ending before July 1, 1989) or such lesser amount as the
Committee may approve, in the event of Hardship. For
purposes of this Section, Hardship is defined as immediate
and heavy financial need of the Employee where such
Employee lacks other available resources. Hardship
distributions are subject to the spousal consent
requirements contained in Sections 411(a)(11) and 417 of
the Code. The Committee is authorized to and shall
request from the Participant making such a request such
evidence as the Committee deems necessary and appropriate
to substantiate a Hardship, the amount of expenses
resulting from such Hardship and the other resources of
38
the Participant reasonably available to meet such
expenses.
(B) SPECIAL RULES:
(1) IMMEDIATE AND HEAVY NEED. The following are the
only financial needs considered immediate and heavy:
expenses incurred or necessary for medical care,
described in Section 213(d) of the Code, of the
Employee, the Employee's Spouse or dependents; the
purchase (excluding mortgage payments) of a
principal residence for the Employee; payment of
tuition and related educational fees for the next
twelve months of post-secondary education for the
Employee, the Employee's Spouse, children or
dependents; or the need to prevent the eviction of
the Employee from, or a foreclosure on the mortgage
of, the Employee's principal residence.
(2) SATISFACTION OF NEED. A distribution will be
considered as necessary to satisfy an immediate and
heavy financial need of the Employee only if:
(a) The Employee has obtained all distributions,
other than Hardship distributions, and all
nontaxable loans under all plans maintained
by the Employer;
(b) All plans maintained by the Employer provide
that the Employee's Before Tax Contributions
(and After Tax Contributions) will be
suspended for twelve months after the receipt
of the Hardship distribution;
(c) The distribution is not in excess of an
immediate and heavy financial need (including
amounts necessary to pay any federal, state
or local income taxes or penalties reasonably
anticipated to result from the distribution);
and
(d) All plans maintained by the Employer provide
that the Employee may not make Before Tax
Contributions for the Employee's taxable year
immediately following the taxable year of the
Hardship distribution in excess of the
applicable limit under Section 402(g) of the
Code for such taxable year less the amount of
such Employee's Before Tax Contributions for
the taxable year of the Hardship
distribution.
39
(3) TAXES AND PENALTIES. The amount of an immediate and
heavy financial need may include any amounts
necessary to pay any federal, state or local income
taxes or penalties reasonably anticipated to result
from the distribution.
3.10 WITHDRAWAL OF AFTER TAX CONTRIBUTIONS. Subject to the
provisions of the Plan, in accordance with rules for giving
notice as determined by the Committee, a Participant may
withdraw as of the first Accounting Date subsequent to receipt
by the Committee of such notice:
(A) MAXIMUM AMOUNT. An amount equal to not more than 100% of
the Participant's After Tax Contribution Account
determined as of such Accounting Date. No Participant who
has made any withdrawal of After Tax Contributions in the
twelve (12) months preceding the giving of such notice may
make a withdrawal under this Section. A Participant who
makes a withdrawal of After Tax Contributions shall be
required to suspend After Tax Contributions for a period
of six (6) months, commencing with the effective date of
such withdrawal. A Participant may, pursuant to Article
III, elect to commence After Tax Contributions as of the
first day of the first payroll period of the month
following the conclusion of such suspension period, or the
first payroll period of any month thereafter, upon advance
written notice to the Committee.
(B) MINIMUM AMOUNT. Notwithstanding anything to the contrary
in this Section 3.10, any withdrawal made pursuant to
Section 3.10(A) shall be for a minimum whole dollar amount
not less than Five Hundred Dollars ($500.00); except that
if the amount available for withdrawal is less than Five
Hundred Dollars ($500.00) then the minimum amount of the
withdrawal shall be the amount available.
(C) FORFEITURES. No forfeitures will occur solely as a result
of an Employee's withdrawal of After Tax Contributions.
(D) LOAN SECURITY. Notwithstanding anything to the contrary
in this Section 3.10, a Participant may not make a
withdrawal pursuant to this Section of any portion of the
Participants vested interest which has been assigned to
secure repayment of a loan in accordance with Section
11.10, below, until such time as the Committee shall have
released said portion so assigned.
3.11. WITHDRAWAL OF MATCHING CONTRIBUTIONS. Subject to the
provisions of the Plan, in accordance with rules for giving
notice as determined by the Committee, and as elected in the
Adoption Agreement, a Participant may withdraw as of the first
40
Accounting Date subsequent to receipt by the Committee of such
notice:
(A) MAXIMUM AMOUNT. An amount equal to not more than 100% of
the vested amounts in the Participant's Matching
Contribution Account determined as of such Accounting
Date. No Participant who has made any withdrawal of
Matching Contributions in the twelve (12) months preceding
the giving of such notice may make a withdrawal under this
Section.
(B) MINIMUM AMOUNT. Notwithstanding anything to the contrary
in this Section 3.11, any withdrawal made pursuant to
Section 3.11(A) shall be for a minimum whole dollar amount
not less than Five Hundred Dollars ($500.00); except that
if the amount available for withdrawal is less than Five
Hundred Dollars ($500.00) then the minimum amount of the
withdrawal shall be the amount available.
(C) FORFEITURES. No forfeitures will occur solely as a result
of an Employee's withdrawal of Matching Contributions.
(D) LOAN SECURITY. Notwithstanding anything to the contrary
in this Section 3.11, a Participant may not make a
withdrawal, pursuant to this Section of any portion of the
Participant's vested interest which has been assigned to
secure repayment of a loan in accordance with Section
11.10, below, until such time as the Committee shall have
released said portion so assigned.
ARTICLE IV
OTHER CONTRIBUTIONS
4.1 EMPLOYER CONTRIBUTIONS.
(A) MONEY PURCHASE PENSION PLANS ONLY. As elected by the
Employer in the Adoption Agreement, the Employer shall
make contributions to the Plan.
(B) PROFIT SHARING PLANS AND 401(K) PLANS ONLY.
(1) EMPLOYER CONTRIBUTIONS. For each Plan Year, the
Employer, shall or may make contributions to the
Plan in an amount as selected in the Adoption
Agreement or determined by Resolution of the Board
of Directors of the Employer.
(2) NET PROFITS NOT REQUIRED IF SO ELECTED IN ADOPTION
AGREEMENT. If the Employer elects, Employer
Contributions und a profit sharing Plan may be made
without regard to Net Profits in accordance with
41
Item B(8)(a)(iii) of the Adoption Agreement. The
Plan shall continue to be designed to qualify as a
profit-sharing Plan for purposes of Sections 401(a),
402, 412, and 417 of the Code.
4.2 SEPARATE ACCOUNTS. An Employer Contribution Account shall be
maintained for each Participant to which will be credited the
employer pension or profit sharing contributions ("Employer
Contributions"). Such accounts shall be credited with the
applicable contributions, earnings and losses, distributions,
and other adjustments.
4.3 VESTING. Employer Contributions will be vested in accordance
with the Employer's election in Item B(7), as applicable, of
the Adoption Agreement. In any event, Employer Contributions
shall be fully vested at Normal Retirement Date, upon the
complete or partial termination of the Plan, and, in profit
sharing plans, upon the complete discontinuance of Employer
Contributions.
4.4 LIMITATION ON EMPLOYER CONTRIBUTIONS. The Employer's
Contribution for any Plan Year shall not exceed the maximum
amount which the Employer may deduct pursuant to Section 404 of
the Code. The Employer Contributions shall be payable not
later than the time for filing the Employer's federal income
tax return, including extensions.
4.5 EMPLOYEE CONTRIBUTIONS.
(A) DISTRIBUTIONS FROM QUALIFIED PLANS - ROLLOVERS.
(1) If the Employer selects Item B(9) in the Adoption
Agreement, an Employee who is entitled to make a
rollover contribution described in Section
402(a)(5), Section 403(a)(4) or Section 408(d)(3) of
the Code ("Rollover Contribution"), may elect, with
the approval of the Committee, to make such a
Rollover Contribution to the Plan. The Employee
shall deliver or cause to be delivered, to the
Trustee the cash which constitutes such Rollover
Contribution at such time or times and in such
manner as shall be specified by the Committee. As
of the date of receipt of such property by the
Trustee, a Rollover Account shall be established in
the name of the Employee who has made a Rollover
Contribution as provided in this Section 4.5 and
shall be credited with such assets on such date. A
Rollover Contribution shall not be deemed to be a
contribution of such Employee for any purpose of
this Agreement. All Rollover Contributions and the
earnings on these contributions shall be immediately
fully vested and nonforfeitable.
42
(2) Subject to the provisions of the Plan, on advance
notice given to the Committee in accordance with
rules established by the Committee a Participant in
a profit sharing Plan or 401(k) profit sharing Plan
may withdraw all or any part (in any whole dollar
amount specified by the Participant) of the value of
any Rollover Account, provided no Participant who
has made any withdrawal under Section 4.5(A) during
the calendar year in which such notice is given may
make an additional withdrawal under this Section
4.5(A) during the remainder of such year.
(B) NONDEDUCTIBLE EMPLOYEE CONTRIBUTIONS AND MATCHING
CONTRIBUTIONS NO LONGER ACCEPTED.
(1) This Plan will not accept nondeductible employee
contributions and matching contributions except
pursuant to a 401(m) arrangement described in
Article III. Employee contributions for Plan Years
beginning after December 31, 1986, together with any
matching contributions as defined in Section 401(m)
of the Code, will be limited so as to meet the
nondiscrimination test of Section 401(m).
(2) A separate account will be maintained by the Trustee
for the previously made nondeductible employee
contributions of each Participant.
(3) Employee contributions and earnings thereon will be
nonforfeitable at all times. No forfeitures will
occur solely as a result of an Employee's withdrawal
of Employee contributions.
(C) DEDUCTIBLE EMPLOYEE CONTRIBUTIONS NO LONGER ACCEPTED. The
Committee will not accept deductible Employee
contributions which are made for a taxable year beginning
after December 31, 1986. Contributions made prior to that
date will be maintained in a separate account which will
be nonforfeitable at all times. The account will share in
the gains and losses of the Trust Fund in the same manner
as described in Article VI of the Plan. No part of the
deductible voluntary contribution account will be used to
purchase life insurance. Subject to Section 7.10, Joint
and survivor annuity requirements (if applicable), the
Participant may withdraw any part of the deductible
voluntary contribution account by making a written
application to the Committee.
4.6 EXCLUSIVE BENEFIT. Except as provided in the Plan, the
Employer has no beneficial interest in the Trust Fund, and no
part of the Trust Fund shall revert or be repaid to the
Employer, directly or indirectly, or diverted to purposes other
43
than for the exclusive benefit of Participants and their
Beneficiaries, except that (1) any contribution made by the
Employer because of a mistake of fact must be returned to the
Employer within one year of the contribution; (2) in the event
the deduction of a contribution made by the Employer is
disallowed under Section 404 of the Code, such contribution (to
the extent disallowed) must be returned to the Employer within
one year of the disallowance of the deduction; and (3) in the
event that the Commissioner of Internal Revenue determines that
the Plan is not initially qualified under the Internal Revenue
Code, any contribution made incident to that initial
qualification by the Employer must be returned to the Employer
within one year after the date the initial qualification is
denied, but only if the application for the qualification is
made by the time prescribed by law for filing the Employer's
return for the taxable year in which the Plan is adopted or
such later date as the Secretary of the Treasury may prescribe.
4.7 FORM, PAYMENT AND ALLOCATION OF CONTRIBUTIONS. Contributions
made for a Plan Year shall be made in cash; provided, however,
that if the Plan has an Employer Stock Fund, contributions for
the Employer Stock Fund may be made in Employer Stock.
Contributions shall be delivered to the Trustee at such time or
times as shall be agreed upon between the Committee and the
Trustee. The Committee shall instruct the Trustee as to the
allocation of contributions to the Participant's accounts
pursuant to the elections made in the Adoption Agreement.
Employer Stock contributed to the Plan shall be valued at fair
market value at the time of its transfer to the Plan.
4.8 SAFE HARBOR ALLOCATION. Notwithstanding anything to the
contrary in the Adoption Agreement, in the event the
requirements of Code Sections 4 1(a)(26) or 410(b) are not met
during the Plan Year, Employer Contributions will be allocated
to Eligible Employees in the following order until the
applicable requirements are met:
(A) Eligible Employees employed by the Employer on the last
day of the Plan Year and who have completed more than 750
Hours of Service during the Plan Year;
(B) Eligible Employees employed by the Employer on the last
day of the Plan Year and who have completed more than 500
but less than 750 Hours of Service during the Plan Year;
(C) Eligible Employees employed by the Employer on the last
day of the Plan Year and who have completed 500 or fewer
Hours of Service during the Plan Year;
(D) Eligible Employees who have completed 750 or more Hours of
Service during the Plan Year;
44
(E) Eligible Employees who have completed more than 500 but
less than 750 Hours of Service during the Plan Year.
In no event will Employees who have terminated employment
with the Employer during the Plan Year and who have
completed 500 or fewer Hours of Service during the Plan
Year receive any allocation of Employer Profit Sharing
Contributions.
ARTICLE V
PERIOD OF PARTICIPATION
5.1 TERMINATION DATES. A Participant's Termination Date will be
the date on which his employment with the Employer is
terminated because of the first to occur of the following
events:
(A) NORMAL RETIREMENT. The Participant retires from the
employ of the Employer upon attaining the Normal
Retirement Date selected in the Adoption Agreement. If
the Employer enforces a mandatory retirement age the
Normal Retirement Date is the date the Participant attains
the lesser of that mandatory age or the age specified in
the Adoption Agreement.
(B) EARLY RETIREMENT. The Participant retires from the employ
of the Employer upon attaining the Early Retirement Date
selected in the Adoption Agreement. If a Participant
terminates employment prior to meeting any minimum age
specified in the Adoption Agreement but after having
completed the specified minimum service requirement, the
terminated Participant shall be entitled to an early
retirement benefit upon attaining the minimum age
required.
(C) LATE RETIREMENT. The Participant retires from the employ
of the Employer after the Normal Retirement Date. A
Participant who continues to work beyond the Normal
Retirement Date shall continue participation in the Plan
on the same basis as the other Participants.
(D) RETIREMENT. The Participant is terminated from the employ
of the Employer be cause of Disability, as determined by
the Committee, as defined in Section 1.1(I), irrespective
of his age.
(E) DEATH. The Participant's death.
(F) OTHER TERMINATION. The Participant terminates employment
before Normal, Early, Late or Disability Retirement.
45
If a Participant continues in the employ of the Employer
but no longer is a member of a class of Employees to which
the Plan has been and continues to be extended by the
Employer, the Participant's Termination Date nevertheless
will be as stated above and his or her accounts will be
held as stated in Section 5.2.
5.2 RESTRICTED PARTICIPATION. When distribution of part or all of
the benefits to which a Participant is entitled under the Plan
is deferred beyond or cannot be made until after the
Participant's Termination Date, or during any period that a
Participant continues in the employ of the Employer but no
longer is a member of a class of Employees to which the Plan
has been and continues to be extended by the Employer, the
Participant, or in the event of his or her death such
Participant's Beneficiary, will be considered and treated as a
Participant for all purposes of the Plan, except that no share
of contributions or forfeitures will be credited to his or her
Accounts (a) for any period such Participant continues in the
employ of the Employer but no longer is a member of a class of
Employees to which the Plan has been and continues to be
extended by the Employer, or (b) after the Participant's
Termination Date.
ARTICLE VI
ACCOUNTING
6.1 ACCOUNTS ESTABLISHED. There shall be established and
maintained for each Participant such accounts as are
applicable, to reflect such Participant's interest in each
Investment Fund.
All income, expenses, gains and losses attributable to each
account shall be separately accounted for. The interest of
each Participant in the Trust Fund at any time shall consist of
the amount credited to his or her accounts as of the last
preceding Valuation Date plus credits and minus debits to such
accounts since that date.
6.2 EMPLOYER CONTRIBUTIONS CONSIDERED MADE ON LAST DAY OF PLAN
YEAR. Unless otherwise elected in the Adoption Agreement, for
purposes of this Article VI, the Employer's Contribution under
Article IV will be considered to have been made on the last day
of the Plan Year for which contributed.
6.3 ACCOUNTING STEPS. As of each Valuation Date, the Trustee
shall:
(A) Charge to the prior account balances all previously
uncharged payments or distributions made from
46
Participants' accounts since the last preceding Valuation
Date.
(B) Adjust the net credit balances in Participants' accounts
upward or downward, pro rata, so that the total of such
net credit balances will equal the then adjusted net worth
of the Trust Fund;
(C) Allocate and credit Employer Contributions and any
forfeitures (as described in Section 7.3) that are to be
allocated and credited as of that date in accordance with
Sections 6.5 and 6.6.
Notwithstanding the preceding, the Trustee shall be
authorized to utilize such other method of accounting for
the gains or losses experience by the Trust as may
accurately reflect each Participant's interest therein.
6.4 ALLOCATION OF EMPLOYER CONTRIBUTIONS.
(A) DISCRETIONARY PROFIT SHARING CONTRIBUTIONS.
(1) NONSTANDARDIZED PLANS. If the Plan is a
nonstandardized Plan, Employer Contributions for the
Plan Year shall be allocated among and credited to
the Employer Contribution Accounts of each
Participant, including a Participant on leave of
absence, who is entitled to receive a contribution
as elected by the Employer in the Adoption
Agreement, pursuant to the formula elected by the
Employer in Item B(8)(b) of the Adoption Agreement.
If elected in the Adoption Agreement, Participants
whose employment terminated because of retirement,
death or disability before the end of the Plan Year
will share in the contributions for the year if
elected in the Adoption Agreement.
(2) STANDARDIZED PLANS. Employer Contributions for the
Plan Year shall be allocated among and credited to
the Employer Contribution Account of each
Participant who either completes more than 500 Hours
of Service during the Plan Year (or such lesser
number of Hours of Service as may be specified in
the Adoption Agreement) or is employed on the last
day of the Plan Year pursuant to the formula elected
by the Employer in Item B(8)(b) of the Adoption
Agreement. If elected in the Adoption Agreement,
Participants whose employment terminated before the
end of the Plan Year because of retirement, death or
disability will share in the contributions for the
year if elected in the Adoption Agreement.
47
(B) MONEY PURCHASE PENSION PLANS. Employer Contributions will
be made and allocated to the Employer Contribution
Accounts of Participants for the Plan Year as elected in
the Adoption Agreement. Sections 6.4(A)(1) and (2) above
also apply to the Money Purchase Pension Plans.
(C) PAIRED PLANS. Notwithstanding anything in the Plan to the
contrary, if the Employer maintains two plans which are
Paired Plans, only one may contain an allocation, as
elected in the Adoption Agreement, utilizing permitted
disparity as defined in Code Section 401(1).
6.5 ALLOCATION OF FORFEITURES. As elected in Items B(11) and/or
C(6) of the Adoption Agreement, as of the last day of the Plan
Year, any forfeitures which arose under the Plan during that
year shall be used to: (i) pay the expenses of the Plan; (ii)
reduce Employer Contributions; or, (iii) be allocated to
Participants accounts, as may be selected in the Adoption
Agreement. Forfeitures under (iii) shall be allocated as
provided in Section 6.4.
6.6 LIMITATIONS ON ALLOCATIONS.
(A) DEFINITIONS: For purposes of limiting allocations
pursuant to this section, the following definitions shall
apply:
(1) ANNUAL ADDITIONS: The sum of the following amounts
credited to a Participant's account for the
Limitation Year:
(a) Employer Contributions;
(b) Employee Contributions;
(c) forfeitures;
(d) amounts allocated, after March 31, 1984, to
an individual medical account, as defined in
Section 415(1)(2) of the Code, which is part
of a pension or annuity Plan maintained by
the Employer are treated as Annual Additions
to a defined contribution Plan. Also amounts
derived from contributions paid or accrued
after December 31, 1985, in taxable years
ending after such date, which are
attributable to post-retirement medical
benefits, allocated to the separate account
of a Key Employee, as defined in Section
419A(d)(3) of the Code, under a welfare
benefit fund, as defined in Section 419(e) of
the Code, maintained by the Employer are
48
treated as Annual Additions to a defined
contribution Plan; and,
(e) allocations under a simplified employee
pension.
For this purpose, any Excess Amount applied under
Sections 6.6(B)(4) or 6.6(C)(6) in the Limitation
Year to reduce Employer Contributions will be
considered Annual Additions for such Limitation
Year.
(2) COMPENSATION: Compensation as described below,
interpreted consistently with the provisions of Code
Section 414(s) and the regulations issued
thereunder, as may be selected by the Employer, and
uniformly applied for testing purpose:
(a) W-2 COMPENSATION (WAGES, TIPS, AND OTHER
COMPENSATION REQUIRED TO BE REPORTED UNDER
SECTIONS 6041, 6051, AND 6052 OF THE CODE, AS
REPORTED ON FORM W-2). Compensation is
defined as wages within the meaning of
Section 3401(a) and all other payments of
compensation to an Employee by the Employer
(in the course of the Employer's trade or
business) for which the Employer is required
to furnish the Employee a written statement
under Sections 6041(d), 6051(a)(3) and 6052
of the Code. Compensation must be determined
without regard to any rules under Section
3401(a) that limit the remuneration included
in wages based on the nature or location of
the employment or the services performed
(such as the exception for agricultural labor
in Section 3401(a)(2).
(b) WITHHOLDING COMPENSATION (Section 3401 (a)).
Compensation is defined as wages within the
meaning of Section 3401(a) for the purposes
of income tax withholding at the source but
determined without regard to any rules that
limit the remuneration included in wages
based on the nature or location of the
employment or the services performed (such as
the exception for agricultural labor in
Section 3401(a)(2)).
(c) SECTION 415 SAFE-HARBOR COMPENSATION.
Compensation is defined as wages, salaries,
and fees for professional services and other
amounts received (without regard to whether
49
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 salesman, 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 1.62-
2(c)), and excluding the following:
(i) Employer contributions to a Plan of
deferred compensation which are not
includible in the Employee's gross
income for the taxable year in which
contributed, or Employer contributions
under a simplified employee pension
Plan to the extent such contributions
are deductible by the Employee, or any
distributions from a Plan of deferred
compensation;
(ii) amounts realized from the exercise of a
non-qualified stock option, or when
restricted stock (or property) held by
an Employee becomes freely transferable
or is no longer subject to a
substantial risk of forfeiture;
(iii) amounts realized from the sale,
exchange or other disposition of stock
acquired under a qualified stock
option; and
(iv) other amounts which received special
tax benefits, or contributions made by
the Employer (whether or not under a
salary reduction agreement) towards the
purchase of an annuity contract
described in Section 403(b) of the Code
(whether or not the contributions are
actually excludable from the gross
income of the Employee).
Notwithstanding anything in the definitions of
Compensation preceding, at the discretion of the
Employer, uniformly applied, Compensation shall, for
purposes of ADP and ACP testing as provided for in
Article III, include amounts not currently
50
includible in income pursuant to Code Sections 125,
402(a)(8), 402(h) and 403(b). For allocation
purposes, such amounts shall be includible as
elected in the Adoption Agreement.
For any self-employed Individual, Compensation will
mean Earned Income.
For Limitation Years beginning after December 31,
1991, for purposes of applying the limitations of
Section 6.6, Compensation for a Limitation Year is
the compensation actually paid or made available
during such Limitation Year.
Notwithstanding the preceding sentence, Compensation
for a Participant in a defined contribution Plan who
is permanently and totally disabled (as defined in
Section 22(e)(3) of the Code) is the Compensation
such Participant would have received for the
Limitation Year if the Participant had been paid at
the rate of Compensation paid immediately before
becoming permanently and totally disabled; such
imputed compensation for the disabled Participant
may be taken into account only if the Participant is
not a Highly Compensated Employee, (as defined in
Section 414(q) of the Code), and contributions made
on behalf of such Participant are nonforfeitable
when made.
(3) DEFINED BENEFIT FRACTION: A fraction, the numerator
of which is the sum of the Participant's Projected
Annual Benefits under all the defined benefit plans
(whether or not terminated) maintained by the
Employer, and the denominator of which is the lesser
of 125 percent of the dollar limitation determined
for the Limitation Year under Sections 415(b) and
(d) of the Code or 140 percent of the Participant's
Highest Average Compensation, including any
adjustments under Section 415(b) of the Code.
Notwithstanding the above if the Participant was a
participant as of the first day of the first
Limitation Year beginning after December 31, 1986,
in one or more defined benefit plans maintained by
the Employer which were in existence on May 6, 1986,
the denominator of this fraction will not be less
than 125 per cent of the sum of the annual benefits
under such plans which the Participant had accrued
as of the close of the last Limitation Year
beginning before January 1, 1987, disregarding any
changes in the terms and conditions of the Plan
after May 5, 1986. The preceding sentence applies
51
only if the defined benefit plans individually and
in the aggregate satisfied the requirements of
Section 415 for all Limitation Years beginning
before January 1, 1987.
(4) DEFINED CONTRIBUTION DOLLAR LIMITATION: For
purposes of calculating the Maximum Permissible
Amount: $30,000 or, if greater, one-fourth of the
defined benefit dollar limitation set forth in
Section 415(b)(1) of the Code as in effect for the
Limitation Year.
(5) DEFINED CONTRIBUTION FRACTION: A fraction, the
numerator of which is the sum of the Annual
Additions to the Participant's accounts under all
the defined contribution plans (whether or not
terminated) maintained by the Employer for the
current and all prior Limitation Years, (including
the Annual Additions attributable to the
Participant's nondeductible employee contributions
to all defined benefit plans, whether or not
terminated, maintained by the Employer, and the
Annual Additions attributable to all welfare benefit
funds, as defined in Section 419(e) of the Code,
individual medical accounts, as defined in Section
415(1)(2) of the Code, and simplified employee
pension, maintained by the Employer), and the
denominator of which is the sum of the maximum
aggregate amounts for the current and all prior
Limitation Years of service with the Employer
(regardless of whether a defined contribution Plan
was maintained by the Employer). The maximum
aggregate amount in any Limitation Year is the
lesser of 125 percent of the dollar limitation
determined under Sections 415(b) and (d) of the Code
in effect under Section 415(c)(1)(A) of the Code or
35 percent of the Participant's Compensation for
such year.
If the Employee was a participant as of the end of
the first day of the first Limitation Year beginning
after December 31, 1986, in one or more defined
contribution plans maintained by the Employer which
were in existence on May 6, 1986, the numerator of
this fraction will be adjusted if the sum of this
fraction and the Defined Benefit Fraction would
otherwise exceed 1.0 under the terms of this Plan.
Under the adjustment, an amount equal to the product
of (1) the excess of the sum of the fractions over
1.0 times (2) the denominator of this fraction, will
be permanently subtracted from the numerator of this
fraction. The adjustment is calculated using the
52
fractions as they would be computed as of the end of
the last Limitation Year beginning before January 1,
1987, and disregarding any changes in the terms and
conditions of the Plan made after May 5, 1986, but
using the Section 415 limitation applicable to the
first Limitation Year beginning on or after January
1, 1987.
The Annual Addition for any Limitation Year
beginning before January 1, 1987, shall not be
recomputed to treat all Employee contributions as
Annual Additions.
(6) EMPLOYER: For purposes of this Section 6.6: the
Employer that adopts this Plan, and all members of a
controlled group of corporations (as defined in
section 414(b) of the Code as modified by Section
415(h), all commonly controlled trades or businesses
(as defined in Section 414(c) as modified by Section
415(h)) or affiliated service groups (as defined in
Section 414(m)) of which the adopting Employer is a
part, and any other entity required to be aggregated
with the Employer pursuant to regulations under
Section 414(o) of the Code.
(7) EXCESS AMOUNT: The excess of the Participant's
Annual Additions for the Limitation Year over the
Maximum Permissible Amount.
(8) HIGHEST AVERAGE COMPENSATION: For purposes of
calculating the Defined Benefit Fraction, the
average compensation for the three (3) consecutive
Years of Service with the Employer that produces the
highest average. A Year of Service with the
Employer is the twelve-consecutive month period
defined in Item B(4)(j) of the Adoption Agreement.
(9) LIMITATION YEAR: A calendar year or any other 12
consecutive month period elected in Item 9 of the
Adoption Agreement. All qualified plans maintained
by the Employer must use the same Limitation Year.
If the Limitation Year is amended to a different 12-
consecutive month period, the new Limitation Year
must begin on a date within the Limitation Year in
which the amendment is made.
(10) MASTER OR PROTOTYPE PLAN: A Plan the form of which
is the subject of a favorable opinion letter from
the Internal Revenue Service.
(11) MAXIMUM PERMISSIBLE AMOUNT: The maximum Annual
Addition that may be contributed or allocated to a
53
Participant's account under the Plan for any
Limitation Year shall not exceed the lesser of:
(a) the Defined Contribution Dollar Limitation,
or
(b) 25 percent of the Participant's Compensation
for the Limitation Year.
The Compensation limitation referred to in (b)
shall not apply to any contribution for medical
benefits (within the meaning of Section 401(h) or
Section 419A(f)(2) of the Code) which is otherwise
treated as an Annual Addition under Section
415(l)(1) or 419A(d)(2) of the Code.
If a short Limitation Year is created because of an
amendment changing the Limitation Year to a
different 12-consecutive month period, the Maximum
Permissible Amount will not exceed the Defined
Contribution Dollar Limitation multiplied by the
following fraction:
Number of months in the short Limitation Year
---------------------------------------------
12
(12) PROJECTED ANNUAL BENEFIT: For purposes of
calculating the Defined Benefit Fraction: the annual
retirement benefit (adjusted to an actuarially
equivalent straight life annuity if such benefit is
expressed in a form other than a straight life
annuity or qualified joint and survivor annuity) to
which the Participant would be entitled under the
terms of the Plan, assuming: (1) the Participant
will continue employment until Normal Retirement
Date under the Plan, (or current age, if later), and
(2) the Participant's Compensation for the current
Limitation Year and all other relevant factors used
to determine benefits under the Plan will remain
constant for all future Limitation Years.
(B) ANNUAL ADDITION LIMITATIONS:
(1) If the Participant does not participate in, and has
never participated in another qualified Plan or
welfare benefit fund, as defined in Section 419(e)
of the Code maintained by the Employer, or an
individual medical account, as defined in Section
415(1)(2) of the Code, maintained by the Employer,
or a simplified employee pension, as defined in
Section 408(K) of the Code, maintained by the
54
Employer which provides an Annual Addition as
defined in Section 6.6(E), the amount of Annual
Additions which may be credited to the Participant's
account for any Limitation Year will not exceed the
lesser of the Maximum Permissible Amount or any
other limitation contained in this Plan. If the
Employer Contribution that would otherwise be
contributed or allocated to the Participant's
account would cause the Annual Additions for the
Limitation Year to exceed the Maximum Permissible
Amount, the amount contributed or allocated will be
reduced so that the Annual Additions for the
Limitation Year will equal the Maximum Permissible
Amount.
(2) Prior to determining the Participant's actual
Compensation for the Limitation Year, the Employer
may determine the Maximum Permissible Amount for a
Participant on the basis of a reasonable estimation
of the Participant's Compensation for the Limitation
Year, uniformly determined for all Participants
similarly situated.
(3) As soon as is administratively feasible after the
end of the Limitation Year, the Maximum Permissible
Amount for the Limitation Year will be determined on
the basis of the Participant's actual Compensation
for the Limitation Year.
(4) If pursuant to Section 6.6(B)(3) or as result of the
allocation of forteitures, there is an Excess
Amount, the excess will be disposed of as follows:
(a) Any nondeductible voluntary employee
contributions, to the extent they would
reduce the Excess Amount, will be returned to
the Participant.
(b) If after the application of paragraph (a) an
Excess Amount still exists and the
Participant is covered by the Plan at the end
of the Limitation Year, the Excess Amount in
the Participant's account 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.
(c) If after the application of paragraph (a) an
Excess Amount still exists, and the
Participant is not covered by the Plan at the
55
end of a Limitation Year, the Excess Amount
will be held unallocated in a suspense
account. The suspense account will be
applied to reduce future Employer
Contributions (including allocation of any
forfeitures) for all remaining Participants
in the next Limitation Year and each
succeeding Limitation Year, if necessary.
(d) If a suspense account is in existence at any
time during a Limitation Year pursuant to
this Section 6.6(A), it will not participate
in the allocation of the trust's investment
gains and losses. If a suspense account is
in existence at any time during a particular
Limitation Year, all amounts in the suspense
account must be allocated and reallocated to
Participants' accounts before any Employer
Contributions or any Employee contributions
may be made to the Plan for that Limitation
Year. Excess Amounts may not be distributed
to Participants or former Participants.
(C) MULTIPLE PLAN LIMITATION.
(1) This Section 6.6(C) applies if, in addition to this
Plan, the Participant is covered under another
qualified Master or Prototype defined contribution
Plan maintained by the Employer, a welfare benefit
fund, as defined in Section 419(e) of the Code
maintained by the Employer, or an individual medical
account, as defined in Section 415(1)(2) of the
Code, maintained by the Employer, or a simplified
employee pension maintained by the employer which
provides an Annual Addition as defined in Section
6.6(A) during any Limitation Year. The Annual
Additions which may be credited to a Participant's
accounts under this Plan for any such Limitation
Year shall not exceed the Maximum Permissible Amount
reduced by the Annual Additions credited to a
Participant's accounts under the other qualified
master and prototype defined contribution plans,
welfare benefit funds, individual medical accounts,
and simplified employee pensions for the same
Limitation Year. If the Annual Additions with
respect to the Participant under other qualified
master and prototype defined contribution plans and
welfare benefit funds, individual medical accounts,
and simplified employee pension, maintained by the
Employer are less than the Maximum Permissible
Amount and the contributions that would otherwise be
contributed or allocated to the Participant's
56
Employer Contribution Account under this Plan would
cause the Annual Additions for the Limitation Year
to exceed this limitation, the amount contributed or
allocated will be reduced so that the Annual
Additions under all such plans and funds for the
Limitation Year will equal the Maximum Permissible
Amount. If the Annual Additions with respect to the
Participant under such other qualified master and
prototype defined contribution plans, welfare
benefit funds individual medical accounts, and
simplified employee pension, in the aggregate are
equal to or greater than the Maximum Permissible
Amount, no amount will be contributed or allocated
to the Participant's Employer Contribution Account
under this Plan for the Limitation Year.
(2) Prior to determining the Participant's actual
Compensation for the Limitation Year, the Employer
may determine the Maximum Permissible Amount for a
Participant in the manner described in Section
6.6(B)(2).
(3) As soon as is administratively feasible after the
end of the Limitation Year, the Maximum Permissible
Amount for the Limitation Year will be determined on
the basis of the Participant's actual Compensation
for the Limitation Year.
(4) If, pursuant to Section 6.6(C)(3) or as a result of
the allocation of forfeitures, a Participant's
Annual Additions under this Plan and all other plans
result in an Excess Amount for a Limitation Year,
the Excess Amount shall be deemed to consist of the
amounts last allocated, except that Annual Additions
attributable to a simplified employee pension will
be deemed to have been allocated first, followed by
annual additions to a welfare benefit fund or
individual medical account regardless of the actual
allocation date.
(5) If an Excess Amount was allocated to a Participant
on an allocation date of this Plan which coincides
with an allocation date of another Plan, the Excess
Amount attributed to this Plan will be the product
of:
(a) the total Excess Amount allocated as of such
date, times
(b) the ratio of (i) the Annual Additions
allocated to the Participant for the
Limitation Year as of such date under this
57
Plan to (ii) the total Annual Additions
allocated to the Participant for the
Limitation Year as of such date under this
and all other qualified Master or Prototype
defined contribution plans.
(6) Any Excess Amount attributed to this Plan should be
disposed of as provided in Section 6.6(C)(4).
(D) If the Participant is covered under another qualified
defined contribution Plan maintained by the Employer which
is not a Master or Prototype Plan, Annual Additions which
may be credited to the Participant's accounts under this
Plan for any Limitation Year will be limited in accordance
with Section 6.6(C) (1-6) as though the Plan were a
Master or Prototype Plan unless the Employer provides
other limitations in Item B(12) of the Adoption Agreement.
(E) If the Employer maintains, or at any time maintained, a
qualified defined benefit Plan covering any Participant in
this Plan, the sum of the Participant's Defined Benefit
Plan Fraction and Defined Contribution Plan Fraction will
not exceed 1.0 in any Limitation Year. The Annual
Additions which may be credited to the Participant's
accounts under this Plan for any Limitation Year will be
limited in accordance with Item B(12) of the Adoption
Agreement.
6.7 REPORTS TO PARTICIPANTS. The Committee shall cause reports to
be made at least annually to each Participant and to the
Beneficiary of each deceased Participant as to the value of
each such Participant's accounts, as of an appropriate
preceding Valuation Date.
ARTICLE VII
PAYMENT OF ACCOUNT BALANCES
7.1 TERMINATION OF EMPLOYMENT UPON DISABILITY OR DEATH. A
Participant shall become fully vested in his or her Employer
Contribution Accounts if the Participant becomes Disabled under
Sections 5.1(A), (B), (C) or (D) or dies while still employed.
The accounts of a Participant who retires becomes Disabled or
dies will become distributable to the Participant or to his or
her Spouse or Beneficiary. If distributed immediately, subject
to Section 7.4, the distributable balance, after adjustments,
will be determined as soon as practicable following the receipt
by the Trustee of written notice of the Participant's
termination from the Committee.
58
7.2 TIMING FOR DETERMINING ACCOUNT BALANCE UPON TERMINATION OF
EMPLOYMENT PRIOR TO RETIREMENT, DISABILITY OR DEATH. If a
Participant terminates employment with the Employer before
retirement under Sections 5.1(F) the vested portion of the
Participant's Employer Contribution Account and/or Matching
Account shall be determined and such Participant's accounts
will be distributable to the Participant. If distributed
immediately, subject to Section 7.4, the distributable balance,
after adjustments, will be determined as soon as practicable
following receipt by the Trustee of written notice of the
Participant's termination from the Committee. The account
balance shall be distributable at such time as elected in the
Adoption Agreement, but in no event shall an account balance
not be distributable later than the Participant's Normal
Retirement Date.
7.3 VESTING ON DISTRIBUTION BEFORE BREAK-IN-SERVICE; CASH-OUTS.
(A) If an Employee terminates service, and the value of the
Employee's vested account balance derived from Employer
and Employee contributions is not greater than $3,500, the
Employee will receive a distribution of the value of the
entire vested portion of such account balances, and
Rollover Account balance, if any. The nonvested portion
will be treated as a forfeiture. For purposes of this
Section 7.3, if the value of an Employee's vested account
balance is zero, the Employee shall be deemed to have
received a distribution of such vested account balance. A
Participant's vested account balance shall not include
accumulated deductible employee contributions within the
meaning of Section 72(o)(5)(B) of the Code for Plan Years
beginning prior to January 1, 1989.
(B) If an Employee terminates service, and elects, in
accordance with the requirements of Section 7.4, to
receive the value of the Employee's vested account
balance, the nonvested portion will be treated as a
forfeiture. If the Employee elects to have distributed
less than the entire vested portion of the balance in the
Employer Contribution Account, the part of the nonvested
portion that will be treated as a forfeiture is the total
nonvested portion multiplied by a fraction, the numerator
of which is the amount of the distribution attributable to
Employer Contributions and the denominator of which is the
total value of the vested balance in the Employer
Contribution Account.
(C) If an Employee receives a distribution pursuant to this
Section 7.3 and the Employee resumes employment covered
under this Plan, the Employee's Employer Contribution
Account and/or Matching Account balance will be restored
to the amount on the date of distribution if the Employee
59
repays to the Plan the full amount of the distribution
attributable to Employer contributions before the earlier
of 5 years after the first date on which the Participant
is subsequently reemployed by the Employer, or the date
the Participant incurs five (5) consecutive one (1) year
Breaks in Service following the date of the distribution.
If an Employee is deemed to receive a distribution
pursuant to this Section 7.3, and the Employee resumes
employment covered under this Plan before the date the
Participant incurs five (5) consecutive one (1) year
Breaks in Service, upon the reemployment of such Employee,
the Employer Contribution Account balance and/or Matching
Account balance of the Employee will be restored to the
amount on the date of such deemed distribution.
7.4 RESTRICTIONS ON IMMEDIATE DISTRIBUTIONS.
(A) If the value of a Participant's vested account balance
derived from Employer and Employee contributions exceeds
(or at the time of any prior distribution exceeded)
$3,500, and the account balance is immediately
distributable, the Participant and the Participant's
Spouse (or where either the Participant or the Spouse has
died, the survivor) must consent to any distribution of
such account balance. The consent of the Participant and
the Participant's Spouse shall be obtained in writing
within the 90-day period ending on the annuity starting
date. The annuity starting date is the first day of the
first period for which an amount is paid as an annuity or
any other form. The Committee shall notify the
Participant and the Participant's Spouse of the right to
defer any distribution until the Participant's account
balance is no longer immediately distributable. Such
notification shall include a general description of the
material features, and an explanation of the relative
values of, the optional forms of benefit available under
the Plan in a manner that would satisfy the notice
requirements of Section 417(a)(3), and shall be provided
no less than 30 days and no more than 90 days prior to the
annuity starting date. However, distribution may commence
less than 30 days after the notice described in the
preceding sentence is given, provided the distribution is
one to which sections 401(a)(11) and 417 of the Internal
Revenue Code do not apply, the plan administrator clearly
informs the participant that the participant has a right
to a period of at least 30 days after receiving the notice
to consider the decision of whether or not to elect a
distribution (and, if applicable, a particular
distribution option), and the participant, after receiving
the notice, affirmatively elects a distribution.
60
Notwithstanding the foregoing, only the Participant need
consent to the commencement of a distribution in the form
of a Qualified Joint and Survivor Annuity while the
account balance is immediately distributable.
(Furthermore, if payment in the form of a Qualified Joint
and Survivor Annuity is not required with respect to the
Participant pursuant to Section 7.10 of the Plan, only the
Participant need consent to the distribution of an account
balance that is immediately distributable. Neither the
consent of the Participant nor the Participant's Spouse
shall be required to the extent that a distribution is
required to satisfy Section 401(a)(9) or Section 415 of
the Code. In addition, upon termination of this Plan if
the Plan does not offer an annuity option (purchased from
a commercial provider), and if the Employer or any entity
within the same controlled group as the Employer does not
maintain another defined contribution Plan (other than an
employee stock ownership Plan as defined in Section
4975(e)(7) of the Code), the Participant's account balance
will, without the Participant's consent, be distributed to
the Participant. However, if any entity within the same
controlled group as the Employer maintains another defined
contribution Plan (other than an employee stock ownership
Plan as defined in Section 4975(e)(7) of the Code) then
the Participant's account balance will be transferred,
without the Participant's consent, to the other Plan if
the Participant does not consent to an immediate
distribution.
An account balance is immediately distributable if any
part of the account balance could be distributed to the
Participant (or surviving spouse) before the Participant
attains or would have attained if not deceased) the later
of the Normal Retirement Date or age 62.
(B) For purposes of determining the applicability of the
foregoing consent requirements to distributions made
before the first day of the first Plan Year beginning
after December 31, 1988, the Participant's vested account
balance shall not include amounts attributable to
accumulated deductible employee contributions within the
meaning of Section 72(o)(5)(B) of the Code.
7.5 COMMENCEMENT OF BENEFITS. Unless the Participant elects
otherwise, payments will be made or commence to a Participant
by the Trustee, as directed by the Committee, no later than the
sixtieth (60th) day after the latest of the close of the Plan
Year in which (1) the Participant attains age sixty-five (65)
(or Normal Retirement Date; if earlier); (2) occurs the tenth
(10th) anniversary of the year in which the Participant
commenced participation in the Plan; or (3) the Participant
terminates his or her service with the Employer.
61
Notwithstanding the foregoing, the failure of a Participant and
Spouse to consent to a distribution while a benefit is
immediately distributable, within the meaning of Section 7.4 of
the Plan, shall be deemed to be an election to defer
commencement of payment of any benefit sufficient to satisfy
this section.
7.6 TIMING AND MODES OF DISTRIBUTION.
(A) GENERAL RULES.
(1) Subject to Section 7.10, Joint and Survivor Annuity
Requirements, the requirements of this Section 7.6
shall apply to any distribution of a Participant's
interest and will take precedence over any
inconsistent provisions of this Plan. Unless
otherwise specified, the provisions of this Section
7.6 apply to calendar years beginning after December
31, 1984.
(2) All distributions required under this Section 7.6
shall be determined and made in accordance with the
Income Tax Regulations under Section 401 (a)(9),
including the minimum distribution incidental
benefit requirement of Section 1.401(a)(9)-2 of the
regulations.
(3) The normal form of payment for a profit-sharing Plan
satisfying the requirements of Section 7.10(F)
hereof shall be a single sum with no option for
annuity payments; provided, however, that
distributions may be made:
(a) In installment payments, if the Employer has
elected installment payments in Item B(10)(a)
of the Adoption Agreement;
(b) Through such other form of benefit as may be
identified in Item B(10)(a) of the Adoption
Agreement, which shall be available to
Participants as an optional form of benefit
payment, and shall preclude Employer
discretion;
(c) Through such other form of benefits as may be
required to be protected as Section 411(d)(6)
protected benefits.
(B) REQUIRED BEGINNING DATE. The entire interest of a
Participant must be distributed or begin to be distributed
no later than the Participant's required beginning date.
62
(C) LIMITS ON DISTRIBUTION PERIODS. As of the first
distribution calendar year, distributions, if not made in
a single-sum, may only be made over one of the following
periods (or a combination thereof):
(1) the life of the Participant,
(2) the life of the Participant and a designated
Beneficiary,
(3) a period certain not extending beyond the life
expectancy of the Participant, or
(4) a period certain not extending beyond the joint and
last survivor expectancy of the Participant and a
designated Beneficiary.
(D) DETERMINATION OF AMOUNT TO BE DISTRIBUTED EACH YEAR. If
the Participant's interest is to be distributed in other
than a single sum, the following minimum distribution
rules shall apply on or after the required beginning date:
(1) INDIVIDUAL ACCOUNT.
(a) If a Participant's benefit is to be
distributed over:
(i) a period not extending beyond the life
expectancy of the participant or the
joint life and last survivor expectancy
of the Participant and the Participant's
designated Beneficiary; or
(ii) a period not extending beyond the life
expectancy of the designated
Beneficiary, the amount required to be
distributed for each calendar year,
beginning with distributions for the
first distribution calendar year, must
at least equal the quotient obtained by
dividing the Participant's benefit by
the applicable life expectancy.
(b) For calendar years beginning before January
1, 1989, if the Participant's Spouse is not
the designated beneficiary, the method of
distribution selected must assure that at
least 50% of the present value of the amount
available for distribution is paid within the
life expectancy of the Participant.
63
(c) For calendar years beginning after December
31, 1988, the amount to be distributed each
year, beginning with distributions for the
first distribution calendar year shall not be
less than the quotient obtained by dividing
the Participant's benefit by the lesser of
(1) the applicable life expectancy or (2) if
the Participant's Spouse is not the
designated Beneficiary, the applicable
divisor determined from the table set forth
in Q&A-4 of Section 1.401(a)(9)-2 of the
Income Tax Regulations. Distributions after
the death of the Participant shall be
distributed using the applicable life
expectancy in Section (1)(a) above as the
relevant divisor without regard to
Regulations Section 1.401(a)(9)-2.
(d) The minimum distribution required for the
Participant's first distribution calendar
year must be made on or before the
Participant's required beginning date. The
minimum distribution for other calendar
years, including the minimum distribution for
the distribution calendar year in which the
Employee's required beginning date occurs,
must be made on or before December 31 of that
distribution calendar year.
(2) OTHER FORMS. If the Participant's benefit is
distributed in the form of an annuity purchased from
an insurance company, distributions thereunder shall
be made in accordance with the requirements of
Section 401 (a)(9) of the Code and the regulations
thereunder.
(E) DEATH DISTRIBUTION PROVISIONS
(1) DISTRIBUTION BEGINNING BEFORE DEATH. If the
Participant dies after distribution of his or her
interest has begun, the remaining portion of such
interest will continue to be distributed at least as
rapidly as under the method of distribution being
used prior to the Participant's death.
(2) DISTRIBUTION BEGINNING AFTER DEATH. If the
Participant dies before distribution of his or her
interest begins, distribution of the Participant's
entire interest shall be completed by December 31 of
the calendar year containing the fifth anniversary
of the Participant's death except to the extent that
64
an election is made to receive distributions in
accordance with (a) or (b) below:
(a) if any portion of the Participant's interest
is payable to a designated Beneficiary,
distributions may be made over the life or
over a period certain not greater than the
life expectancy of the designated Beneficiary
commencing on or before December 31 of the
calendar year immediately following the
calendar year in which the Participant died;
(b) if the designated Beneficiary is the
Participant's surviving Spouse, the date
distributions are required to begin in
accordance with (a) above shall not be
earlier than the later of (1) December 31 of
the calendar year immediately following the
calendar year in which the Participant died
and (2) December 31 of the calendar year in
which the Participant would have attained age
70-1/2.
If the Participant has not made an election
pursuant to this Section 7.6(E)(2) by the
time of his or her death, the Participant's
designated Beneficiary must elect the method
of distribution no later than the earlier of
(1) December 31 of the calendar year in which
distributions would be required to begin
under this section, or (2) December 31 of the
calendar year in which contains the fifth
anniversary of the date of death of the
Participant. If the Participant has no
designated Beneficiary, or if the designated
Beneficiary does not elect a method of
distribution, distribution of the
Participant's entire interest must be
completed by December 31 of the calendar year
containing the fifth anniversary of the
Participant's death.
(3) SURVIVING SPOUSE'S DEATH. For purposes of Section
(E)(2) above, if the surviving Spouse dies after the
Participant, but before payments to such Spouse
begin, the provisions of Section (E)(2) with the
exception of paragraph (b) therein, shall be applied
as if the surviving Spouse were the Participant.
(4) MINOR BENEFICIARY. For purposes of this Section
(E), any amount paid to a child of the Participant
will be treated as if it had been paid to the
65
surviving Spouse if the amount becomes payable to
the surviving Spouse when the child reaches the age
of majority.
(5) DISTRIBUTION CONSIDERED TO BEGIN ON REQUIRED
BEGINNING DATE. For the purposes of this Section
(E), distribution of a Participant's interest is
considered to begin on the Participant's required
beginning date (or, if Section (E)(3) above is
applicable, the date distribution is required to
begin to the surviving Spouse pursuant to Section
(E)(2) above). If distribution in the form of an
annuity irrevocably commences to the Participant
before the required beginning date, the date
distribution is considered to begin is the date
distribution actually commences.
(F) DEFINITIONS.
(1) APPLICABLE LIFE EXPECTANCY: The life expectancy (or
joint and last survivor expectancy) calculated using
the attained age of the Participant (or designated
Beneficiary) as of the Participant's (or designated
Beneficiary's) birthday in the applicable calendar
year reduced by one for each calendar year which has
elapsed since the date life expectancy was first
calculated. If life expectancy is being
recalculated, the applicable life expectancy shall
be the life expectancy as so recalculated. The
applicable calendar year shall be the first
distribution calendar year, and if life expectancy
is being recalculated such succeeding calendar year.
(2) DESIGNATED BENEFICIARY: The individual who is
designated as the Beneficiary under the Plan in
accordance with Section 401(a)(9) and the proposed
regulations thereunder.
(3) DISTRIBUTION CALENDAR YEAR: A calendar year for
which a minimum distribution is required. For
distributions beginning before the Participant's
death, the first distribution calendar year is the
calendar year immediately preceding the calendar
year which contains the Participant's required
beginning date. For distributions beginning after
the Participant's death, the first distribution
calendar year is the calendar year in which
distributions are required to begin pursuant to
Section (E) above.
(4) LIFE EXPECTANCY: Life expectancy and joint and last
survivor expectancy are computed by use of the
66
expected return multiples in Tables V and VI of
Section 1.72-9 of the Income Tax Regulations.
Unless otherwise elected by the Participant (or
Spouse, in the case of distributions described in
Section (E)(2)(b) above) by the time distributions
are required to begin, life expectancies shall be
recalculated annually. Such election shall be
irrevocable as to the Participant (or Spouse) and
shall apply to all subsequent years. The life
expectancy of a non-spouse Beneficiary may not be
recalculated.
(5) PARTICIPANT'S BENEFIT:
(a) The account balance as of the last valuation
date in the calendar year immediately
preceding the distribution calendar year
(valuation calendar year) increased by the
amount of any contributions or forfeitures
allocated to the account balance as of dates
in the valuation calendar year after the
valuation date and decreased by distributions
made in the valuation calendar year after the
valuation date.
(b) Exception for second distribution calendar
year. For purposes of paragraph (a) above,
if any portion of the minimum distribution
for the first distribution calendar year is
made in the second distribution calendar year
on or before the required beginning date, the
amount of the minimum distribution made in
the second distribution calendar year shall
be treated as if it had been made in the
immediately preceding distribution calendar
year.
(6) REQUIRED BEGINNING DATE:
(a) GENERAL RULE. The required beginning date of
a Participant is the first day of April of
the calendar year following the calendar year
in which the Participant attains age 70-1/2.
(b) TRANSITIONAL RULES. The required beginning
date of a Participant who attains age 70-1/2
before January 1, 1988, shall be determined
in accordance with (1) or (2) below:
(i) Non-5-percent owners. The required
beginning date of a Participant who is
67
not a 5-percent owner is the first day
of April of the calendar year following
the calendar year in which the later of
retirement or attainment of age 70-1/2
occurs.
(ii) 5-percent owners. The required
beginning date of a Participant who is a
5-percent owner during any year
beginning after December 31, 1979, is
the first day of April following the
later of:
(a) the calendar year in which the
participant attains age 70-1/2, or
(b) the earlier of the calendar year
with or within which ends the Plan
Year in which the Participant
becomes a 5-percent owner, or the
calendar year in which the
Participant retires.
The required beginning date of a Participant
who is not a 5-percent owner who attains age
70-1/2 during 1988 and who has not retired as
of January 1, 1989, is April 1,1990.
(c) 5-PERCENT OWNER. A Participant is treated as
a 5-percent owner for purposes of this
Section if such Participant is a 5-percent
owner as defined in Section 416(i) of the
Code (determined in accordance with Section
416 but without regard to whether the Plan is
top-heavy) at any time during the Plan Year
ending with or within the calendar year in
which such owner attains age 66-1/2 or any
subsequent Plan Year.
(d) Once distributions have begun to a 5-percent
owner under this Section, they must continue
to be distributed, even if the Participant
ceases to be a 5-percent owner in a
subsequent year.
(G) TRANSITIONAL RULE.
(1) DISTRIBUTIONS TO 5-PERCENT OWNERS. Notwithstanding
the other requirements of this Section 7.6 and
subject to the requirements of Section 7.10, Joint
and Survivor Annuity Requirements, distributions on
behalf of any Employee, including a 5-percent owner,
68
may be made in accordance with all of the following
requirements (regardless of when such distribution
commences):
(a) The distribution by the plan is one which
would not have disqualified such plan under
Section 401(a)(9) of the Internal Revenue
Code as in effect prior to amendment by the
Deficit Reduction Act of 1984.
(b) The distribution is in accordance with a
method of distribution designated by the
Employee whose interest in the plan is being
distributed or, if the Employee is deceased,
by a Beneficiary of such Employee.
(c) Such designation was in writing, was signed
by the Employee or the Beneficiary, and was
made before January 1, 1984.
(d) The Employee had accrued a benefit under the
Plan as of December 31, 1983.
(e) The method of distribution designated by the
Employee or the Beneficiary specifies the
time at which distribution will commence, the
period over which distributions will be made,
and in the case of any distribution upon the
Employee's death, the Beneficiaries of the
Employee listed in order of priority.
(2) DISTRIBUTION ON DEATH. A distribution upon death
will not be covered by this transitional rule unless
the information in the designation contains the
required information described above with respect to
the distributions to be made upon the death of the
Employee.
(3) DESIGNATION OF DISTRIBUTION METHOD. For any
distribution which commences before January 1, 1984,
but continues after December 31, 1983, the Employee,
or the Beneficiary, to whom such distribution is
being made, will be presumed to have designated the
method of distribution under which the distribution
is being made if the method of distribution was
specified in writing and the distribution satisfies
the requirements in subsections (G)(1)(a) and (e).
(4) REVOCATION OF DESIGNATIONS. If a designation is
revoked any subsequent distribution must satisfy the
requirements of Section 401(a)(9) of the Code and
the regulations thereunder. If a designation is
69
revoked subsequent to the date distributions are
required to begin, the plan must distribute by the
end of the calendar year following the calendar year
in which the revocation occurs the total amount not
yet distributed v which would have been required to
have been distributed to satisfy Section 401(a)(9)
of the Code and the regulations thereunder, but for
the Section 242(b)(2) election. For calendar years
beginning after December 31, 1988, such
distributions must meet the minimum distribution
incidental benefit requirements in Section 1
.401(a)(9)-2 of the Income Tax Regulations. Any
changes in the designation will be considered to be
a revocation of the designation. However, the mere
substitution or addition of another Beneficiary (one
not named in the designation) under the designation
will not be considered to be a revocation of the
designation, so long as such substitution or
addition does not alter the period over which
distributions are to be made under the designation,
directly or indirectly (for example, by altering the
relevant measuring life). In the case in which an
amount is transferred or rolled over from one Plan
to another Plan, the rules in Q&A J-2 and Q&A J-3
shall apply.
7.7 DESIGNATION OF BENEFICIARY.
(A) DEFAULT BENEFICIARY. In the case of a Participant who is
married, the Participant's Beneficiary shall be the
Participant's Spouse, but if the Participant's Spouse
consents as provided in this Section 7.7, or if the
Participant is not married, then the Participant shall
have the right to designate that after such Participant's
death such Participant's accounts shall be distributed to
a designated Beneficiary or Beneficiaries.
(B) SPOUSAL CONSENT. Any consent of a Spouse given pursuant
to this Section must be in writing and given prior to the
death of the Participant. Such consent must acknowledge
the effect of the Participant's Beneficiary designation,
the identity of any non-Spouse Beneficiary, including any
class of Beneficiaries and contingent Beneficiaries, and
the consent must be witnessed by a Plan representative or
a Notary Public. The Participant may not subsequently
change the designation of his or her Beneficiary unless
his Spouse consents to the new designation in accordance
with the requirements set forth in the preceding sentence.
The consent of a Participant's Spouse shall not be
required if the Participant establishes to the
satisfaction of the Committee that consent may not be
obtained because there is no Spouse, the Spouse cannot be
70
located or because of such other circumstances as the
Secretary of the Treasury may prescribe by regulations. A
Spouse's consent shall be irrevocable. Any consent by a
Spouse, or establishment that the consent of the Spouse
may not be obtained, shall be effective only with respect
to that Spouse.
(C) CHANGING BENEFICIARIES. Subject to Subparagraphs (A) and
(B) above, the Participant's designation of Beneficiary
may be made, changed or revoked by the Participant at any
time by a written instrument, in form satisfactory to the
Committee, and shall become effective only when executed
by such Participant (and, if applicable, consented to by
the Participant's Spouse as set forth in Section 7.7(B))
and filed with the Committee prior to such Participant's
death. If all of the Beneficiaries named in such
designation shall have predeceased such Participant, or
die prior to complete distribution of the Participant's
accounts, or if such Participant fails to execute and file
a designation and is not survived by a Spouse the payment
of such Participant's accounts shall be made pursuant to
the Plan and to such Beneficiaries as required by state
law. Neither the Employer, the Committee, nor the
Trustee, shall have any duty to see that such Participant,
any Spouse or any Beneficiary executes and files any such
designation with the Committee.
7.8 OPTIONAL FORMS OF BENEFIT The optional forms of benefit
provided by this Plan are not subject to Employer discretion
and are made available to all Participants on a
nondiscriminatory basis. The optional forms of benefit are
described in Articles III and VII, as may be selected in the
Adoption Agreement. If selected in Item B(13) of the Adoption
Agreement, the Employer may attach to the Plan a list of the
Section "411(d)(6) protected benefits" that must be preserved
from a individually designed Plan or other prototype Plan which
this Plan amends.
7.9 DISTRIBUTION UPON DISABILITY. In the event of the Disability
of the Participant, the Trustee, following receipt of
notification of such Disability from the Committee, shall make
distributions from the Account.
7.10 JOINT AND SURVIVOR ANNUITY REQUIREMENTS.
(A) APPLICATION. The provisions of this Section 7.10 shall
apply to any Participant who is credited with at least one
Hour of Service with the Employer on or after August 23,
1984, and such other Participants as provided in Section
7.10(G).
71
(B) QUALIFIED JOINT AND SURVIVOR ANNUITY. Unless an optional
form of benefit is selected pursuant to a Qualified
Election within the ninety-day period ending on the
Annuity Starting Date, a married Participant's Vested
Account Balance will be paid in the form of a Qualified
Joint and Survivor Annuity and an unmarried Participant's
Vested Account Balance will be paid in the form of a life
annuity. The Participant may elect to have such annuity
distributed upon attainment of the Earliest Retirement Age
under the Plan.
(C) QUALIFIED PRE-RETIREMENT SURVIVOR ANNUITY. Unless an
optional form of benefit has been selected within the
election period pursuant to a Qualified Election, if a
Participant dies before the Annuity Starting Date then the
Participant's Vested Account Balance shall be applied
toward the purchase of an annuity for the life of the
surviving Spouse. The surviving Spouse may elect to have
such annuity distributed within a reasonable period after
the Participant's death.
(D) DEFINITIONS.
(1) ELECTION PERIOD: The period which begins on the
first day of the Plan Year in which the Participant
attains age 35 and ends on the date of the
Participant's death. If a Participant separates
from service prior to the first day of the Plan Year
in which age 35 is attained, with respect to the
account balance as of the date of separation, the
election period shall begin on the date of
separation.
Pre-age 35 waiver: A Participant who will not yet
attain age 35 as of the end of any current Plan Year
may make a special Qualified Election to waive the
Qualified Preretirement Survivor Annuity for the
period beginning on the date of such election and
ending on the first day of the Plan Year in which
the Participant will attain age 35. Such election
shall not be valid unless the Participant receives a
written explanation of the Qualified Preretirement
Survivor Annuity in such terms as are comparable to
the explanation required under Section 7.10(E).
Qualified Preretirement Survivor Annuity coverage
will be automatically reinstated as of the first day
of the Plan Year in which the Participant attains
age 35. Any new waiver on or after such date shall
be subject to the full requirements of this Section
7.10.
72
(2) EARLIEST RETIREMENT AGE: The earliest date on which,
under the Plan, the Participant could elect to
receive retirement benefits.
(3) QUALIFIED ELECTION: A waiver of a Qualified Joint
and Survivor Annuity or a Qualified Preretirement
Survivor Annuity. Any waiver of a Qualified Joint
and Survivor Annuity or a Qualified Preretirement
Survivor Annuity shall not be effective unless: (a)
the Participant's Spouse consents in writing to the
election; (b) the election designates a specific
Beneficiary including any class of Beneficiaries or
any contingent Beneficiaries, which may not be
changed without spousal consent (or the Spouse
expressly permits designations by the Participant
without any further spousal consent); (c) the
Spouse's consent acknowledges the effect of the
election; and (d) the Spouse's consent is witnessed
by a Plan representative or Notary Public.
Additionally, a Participant's waiver of the
Qualified Joint and Survivor Annuity shall not be
effective unless the election designates a form of
benefit payment which may not be changed without
spousal consent (or the spouse expressly permits
designations by the Participant without any further
spousal consent). If it is established to the
satisfaction of a Plan representative that there is
no Spouse or that the Spouse cannot be located, a
waiver will be deemed a Qualified Election.
Any consent by a Spouse obtained under this
provision (or establishment that the consent of a
Spouse may not be obtained) shall be effective only
with respect to such Spouse. A consent that permits
designations by the Participant without any
requirement of further consent by such Spouse must
acknowledge that the Spouse has the right to limit
consent to a specific Beneficiary, and a specific
form of benefit where applicable, and that the
Spouse voluntarily elects to relinquish either or
both of such rights. A revocation of a prior waiver
may be made by a Participant without the consent of
the Spouse at any time before the commencement of
benefits. The number of revocations shall not be
limited. No consent obtained under this provision
shall be valid unless the Participant has received
notice as provided in Paragraph (E) below.
(4) QUALIFIED JOINT AND SURVIVOR ANNUITY: An immediate
annuity for the life of the Participant with a
survivor annuity for the life of the Spouse which is
not less than 50 percent and not more than 100
73
percent of the amount of the annuity which is
payable during the joint lives of the Participant
and the Spouse and which is the amount of benefit
which can be purchased with the Participant's vested
account balance. The percentage of the survivor
annuity under the Plan shall be 50%.
(5) SPOUSE (SURVIVING SPOUSE): the Spouse or surviving
Spouse of the Participant, provided that a former
Spouse will be treated as the Spouse or surviving
Spouse and the current Spouse will not be treated as
the Spouse or surviving Spouse to the extent
provided under a qualified domestic relations order
as described in Section 414(p) of the Code.
(6) ANNUITY STARTING DATE: The first day of the first
period for which an amount is payable as an annuity
or any other ______.
(7) VESTED ACCOUNT BALANCE: The aggregate value of the
Participant's vested account balances derived from
Employer and Employee contributions (including
rollovers), whether vested before or upon death.
The provisions of this Section 7.10 shall apply to a
Participant who is vested in amounts attributable to
Employer contributions, Employee contributions (or
both) at the time of death or distribution.
(E) NOTICE REQUIREMENTS.
(1) QUALIFIED JOINT AND SURVIVOR ANNUITY. In the case
of a Qualified Joint and Survivor Annuity as
described in Section 7.10(B), the Committee shall no
less than 30 days and no more than 90 days prior to
the Annuity Starting Date provide each Participant a
written explanation of: (i) the terms and conditions
of a Qualified Joint and Survivor Annuity; (ii) the
Participant's right to make and the effect of an
election to waive the Qualified Joint and Survivor
Annuity form of benefit; (iii) the rights of a
Participant's Spouse; and (iv) the right to make,
and the effect of, a revocation of a previous
election to waive the Qualified Joint and Survivor
Annuity.
(2) QUALIFIED PRE-RETIREMENT SURVIVOR ANNUITY. In the
case of a Qualified Pre-Retirement Survivor Annuity
as described in Section 7.10(C), the Committee shall
provide each Participant within the applicable
period for such Participant a written explanation of
the Qualified Pre-Retirement Survivor Annuity in
such terms and in such manner as would be comparable
74
to the explanation provided for meeting the
requirements of Section 7.10(E) applicable to a
Qualified Joint and Survivor Annuity.
The applicable period for a Participant is whichever
of the following periods ends last: (i) the period
beginning with the first day of the Plan Year
preceding the Plan Year in which the Participant
attains age thirty-two (32) and ending with the
close of the Plan Year in which the Participant
attains age thirty-five (35); (ii) a reasonable
period ending after the individual becomes a
Participant; (iii) a reasonable period ending after
Section 7.10(E)(3) ceases to apply to the
Participant; and (iv) a reasonable period ending
after Section 7.10 first applies to the Participant.
Notwithstanding the foregoing, notice must be
provided within a reasonable period ending after
separation from service in the case of a Participant
who separates from service before attaining age
thirty-five (35).
For purposes of applying the preceding paragraph, a
reasonable period ending after the enumerated events
described in (ii), (iii) and (iv) is the end of the
two-year period beginning one year prior to the date
the applicable event occurs, and ending one year
after that date. In the case of a Participant who
separates from service before the Plan Year in which
age 35 is attained, notice shall be provided within
the two-year period beginning one-year prior to
separation and ending one year after separation. If
such a Participant thereafter returns to employment
with the Employer, the applicable period for such
participant shall be redetermined.
(3) SUBSIDIZED ANNUITY DISTRIBUTION. Notwithstanding
the other requirements of this Section 7.10(E), the
respective notices prescribed by this Section
7.10(E) need not be given to a Participant if (1)
the Plan "fully subsidizes" the cost of a Qualified
Joint and Survivor Annuity or Qualified Pre-
Retirement Survivor Annuity, and (2) the Plan does
not allow the Participant to waive the Qualified
Joint and Survivor Annuity or Qualified
Preretirement Survivor Annuity and does not allow a
named Participant to designate a non-Spouse
Beneficiary. For purposes of this Section 7.10(E),
a Plan fully subsidizes the cost of a benefit if no
increase in cost, or decrease in benefits to the
Participant may result from the Participant's
failure to elect another benefit.
75
(F) SAFE HARBOR RULES.
(1) APPLICATION. This Section shall apply to a
Participant in a profit-sharing Plan, and to any
distribution, made on or after the first day of the
first Plan Year beginning after December 31, 1988,
from or under a separate account attributable solely
to accumulated deductible employee contributions, as
defined in Section 72(o)(5)(B) of the Code, and
maintained on behalf of a Participant in a money
purchase pension Plan, (including a target benefit
Plan) if the following conditions are satisfied: (1)
the Participant does not or cannot elect payments in
the form of a life annuity, and (2) on the death of
the Participant, the Participant's vested account
balance will be paid to the Participant's surviving
Spouse, but if there is no surviving Spouse or, if
the surviving Spouse has already consented in a
manner conforming to a Qualified Election, then to
the Participant's designated Beneficiary. The
surviving Spouse may elect to have distribution of
the vested account balance commence within the 90-
day period following the date of the Participant's
death. The account balance shall be adjusted for
gains or losses occurring after the Participant's
death in accordance with the provisions of the Plan
governing the adjustment of account balances for
other types of distributions. This Section 7.10(F)
shall not be operative with respect to a Participant
in a profit-sharing Plan if the Plan is a direct or
indirect transferee of a defined benefit Plan, money
purchase Plan, a target benefit Plan, stock bonus,
or profit-sharing Plan which is subject to the
survivor annuity requirements of Section 401(a)(11)
and Section 417 of the Code. If this Section
7.10(F) is operative, then the provisions of this
Section 7.10, other than in Section 7.10(G), shall
be inoperative.
(2) WAIVER. The Participant may waive the spousal death
benefit described in this section at any time
provided that no such waiver shall be effective
unless it satisfies the conditions of Section
7.10(D)(3) (other than the notification requirement
referred to therein) that would apply to the
Participant's waiver of the Qualified Preretirement
Survivor Annuity.
(3) VESTED ACCOUNT BALANCE. For purposes of this
Section 7.10(F), vested account balance shall mean,
in the case of a money purchase pension Plan or a
target benefit Plan, the Participant's separate
76
account balance attributable solely to accumulated
deductible employee contributions within the meaning
of Section 72(o)(5)(B) of the Code. In the case of
a profit-sharing Plan, vested account balance shall
have the same meaning as provided in Section
7.l0(D)(7).
(G) TRANSITIONAL RULES.
(1) Any living Participant not receiving benefits on
August 23, 1984, who would otherwise not receive the
benefits prescribed by the previous sections of this
Section 7.10 must be given the opportunity to elect
to have the prior sections of this Section 7.10
apply if such Participant is credited with at least
one Hour of Service under this Plan or a predecessor
Plan in a Plan Year beginning on or after January 1,
1976, and such Participant had at least ten (10)
years of vesting service when he or she separated
from service.
(2) Any living Participant not receiving benefits on
August 23, 1984 who was credited with at least one
Hour of Service under this Plan or predecessor i on
or after September 2, 1974, and who is not otherwise
credited with any service in a Plan Year beginning
on or after January 1, 1976 must be given the
opportunity to have his or her benefits paid in
accordance with Section 7.10(G)(4).
(3) The respective opportunities to elect (as described
in Section 7.10(G)(1) and (2) above) must be
afforded to the appropriate Participants during the
period commencing on August 23, 1984 and ending on
the date benefits would otherwise commence to these
Participants.
(4) Any Participant who has elected pursuant to Section
7.10(G)(2) and any Participant who does not elect
under Section 7.10(G)(1) or who meets the
requirements of Section 7.10(G)(1) except that such
Participant does not have at least ten (10) years of
vesting service when he or she separates from
service, shall have his or her benefits distributed
in accordance with all of the following requirements
of benefits would have been payable in the form of a
life annuity:
a) Automatic joint and survivor annuity. If
benefits in the form of a life annuity become
payable to a married participant who:
77
(i) begins to receive payments under the
Plan on or after Normal Retirement
Date; or
(ii) dies on or after Normal Retirement Date
while still working for the Employer;
or
(iii) begins to receive payments on or after
the Qualified Early Retirement Age; or
(iv) separates from service on or after
attaining Normal Retirement Date (or
the Qualified Early Retirement Age) and
after satisfying the eligibility
requirements for the payment of
benefits under the Plan and thereafter
dies before beginning to receive such
benefits;
then such benefits will be received under
this Plan in the form of a Qualified Joint
and Survive or Annuity, unless the
Participant has elected otherwise during the
election period. The election period must
begin at least 6 months before the
Participant attains Qualified Early
Retirement Age and end not more than 90 days
before the commencement of benefits. Any
election hereunder will be in writing and may
be changed by the Participant at any time.
b) Election of early survivor annuity. A
Participant who is employed after attaining
the Qualified Early Retirement Age will be
given the opportunity to elect, during the
election period, to have a survivor annuity
payable on death. If the Participant elects
the survivor annuity, payments under such
annuity must not be less than the payments
which would have been made to the Spouse
under the Qualified Joint and Survivor
Annuity if the Participant had retired on the
day before his or her death. Any election
under this provision will be in writing and
may be changed by the Participant at any
time. The election period begins on the
later of (1) the 90th day before the
Participant attains the Qualified Early
Retirement Age, or (2) the date on which
participation begins, and ends on the date
the Participant terminates employment.
78
c) For purposes of this Section 7.10(G)(4):
(i) Qualified Early Retirement Age is the
latest of: (i) the earliest date, under
the Plan, on which the Participant may
elect to receive retirement benefits,
(ii) the first day of the 120th month
beginning before the Participant
reaches Normal Retirement Date, or
(iii) the date the Participant begins
participation.
(ii) Qualified Joint and Survivor Annuity is
an annuity for the life of the
participant with a survivor annuity for
the life of the Spouse as described in
Section 7.10(D)(4).
(H) NONTRANSFERABILITY. Any annuity distributed from the Plan
must be nontransferable.
(I) INCORPORATION OF TERMS. The terms of any annuity contract
purchased and distributed by the Plan to a Participant or
Spouse shall comply with the requirements of this Plan.
7.11 DISTRIBUTIONS TO QUALIFIED PLANS. In the event a former
Employee whose accounts have not been fully distributed becomes
an active participant in a Plan qualified under Section 401(a)
of the Code, the Committee may direct the Trustee to transfer
the amount in such Participant's account(s) to any such Plan
provided the Plan to receive such transfers authorizes
accepting the transfer, provides that assets transferred shall
be held in a separate account and requires that the assets
transferred shall not be subject to any forfeiture provisions.
7.12 PROFIT SHARING PLANS AND 401(K) PROFIT SHARING PLANS ONLY -
WITHDRAWAL OF EMPLOYER CONTRIBUTIONS. Subject to the
provisions of the Plan, in accordance with rules for giving
notice as determined by the Committee, and as elected in the
Adoption Agreement, a Participant may withdraw as of the first
Accounting Date subsequent to receipt by the Committee of such
notice:
(A) An amount equal to not more than 100% of the Participant's
Employer Contribution Account determined as of such
Accounting Date. No Participant who has made any
withdrawal of Employer Contributions in the twelve (12)
months preceding the giving of such notice may make a
withdrawal under this Section.
(B) Notwithstanding anything to the contrary in this Section
7.12, any withdrawal made pursuant to Section 7.12(A)
79
shall be for a minimum whole dollar amount not less than
Five Hundred Dollars ($500.00); except that if the amount
available for withdrawal is less than Five Hundred Dollars
($500.00) then the minimum amount of the withdrawal shall
be the amount available.
(C) No forfeitures will occur solely as a result of an
Employee's withdrawal of Employer Contributions.
(D) Notwithstanding anything to the contrary in this Section
7.12, a Participant may not make a withdrawal, pursuant to
this Section of any portion of the Participant's vested
interest which has been assigned to secure repayment of a
loan in accordance with Section 10.10, below, until such
time as the Committee shall have released said portion so
assigned.
7.13 PROHIBITION AGAINST ALIENATION.
(A) Except as provided in Sections 401(a)(13) and 414(p) of
the Code, no benefit or interest available under this Plan
will be subject to assignment or alienation, either
voluntarily or involuntarily.
(B) The preceding sentence shall also apply to the creation,
assignment, or recognition of a right to any benefit
payable with respect to a Participant pursuant to a
domestic relations order, unless the Committee determines
that such order is a qualified domestic relations order,
as defined in Section 414(p) of the Code, or any domestic
relations order entered before January 1, 1985.
(C) All rights and benefits, including elections, provided to
a Participant in this Plan shall be subject to the rights
afforded to any "alternate payee" under a "qualified
domestic relations order." Furthermore, an immediate
distribution to an "alternate payee" shall be permitted if
such distribution is authorized by a "qualified domestic
relations order," even if the affected Participant has not
reached the "earliest retirement age" under the Plan,
provided that in no event will any such distribution
accelerate the repayment of any loan made to the affected
Participant under the Plan, unless such Participant
consents thereto in writing. For purposes of this Section
7.13, "alternate payee," "qualified domestic relations
order" and "earliest retirement age" shall have the
meaning set forth under Code Section 414(p), unless a
Qualified Distribution Date has been selected in the
Adoption Agreement, in which case the earliest retirement
age shall be the date on which the domestic relations
order is determined to be qualified.
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7.14 MISSING PARTICIPANT OR BENEFICIARY. Each Participant and/or
each Beneficiary must file with the Committee from time to time
in writing his or her post office address and each change of
post office address. Any communication, statement or notice
addressed to a Participant and/or Beneficiary at such last post
office address filed with the Committee or if no address is
filed with the Committee then at the last post office address
as shown on the Employer's records, will be binding on the
Participant and/or Beneficiary for all purposes of the Plan.
Neither the Committee nor the Trustee shall be required to
search for or locate a Participant or Beneficiary.
Any other provision of the Plan to the contrary
notwithstanding, if any application for a benefit has not been
filed by a Participant otherwise eligible therefor within
ninety (90) days after the Plan Year in which occurred his or
her termination date, the Committee shall mail to such
Participant and/or Beneficiary at his or her last known address
an application for benefit and a reminder that he or she is
eligible for such benefit. If such application is not filed
with the Committee in accordance with the provisions of the
Plan within ninety (90) days after it is so mailed to such
Participant or his or her termination date, whichever is later,
the benefit shall be forfeited and shall be used to reduce
future Employer Contributions as though the Participant were
not vested in his or her accounts as of the end of said ninety
(90) day period. Upon the subsequent filing of an application
therefor by the Participant and/or his Beneficiary, such
accounts shall be immediately reinstated pursuant to this
provision as though the Participant were 100% vested in his or
her accounts in an amount equal to the cash value of the
accounts on the date forfeited. To the extent forfeited
amounts are not available, the Employer shall contribute the
amount required to reinstate the Participant's account balance.
7.15 LIMITATION ON CERTAIN DISTRIBUTIONS. Notwithstanding anything
contained herein to the contrary, the Trustee may, in its
discretion, delay satisfying requests for distributions for up
to one year where distributions require amounts to be withdrawn
from the Guaranteed Investment Contract Fund; provided,
however, that in no event shall the Trustee delay distributions
to a Participant beyond the legally required time for
distribution as set forth in Section 7.5.
7.16 FORM OF DISTRIBUTIONS AND WITHDRAWALS. The Trustee shall make
all distributions and withdrawals under the Plan, including
Hardship withdrawals, other withdrawals while the Participant
is still employed, and distributions upon retirement,
disability, death and separation from service, pro rata, from
all accounts and Investment Funds, as follows:
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(A) In a Plan with no Employer Stock Fund, all withdrawals and
distributions under the Plan shall be made in cash.
(B) In a Plan with an Employer Stock Fund:
(1) Withdrawals and distributions under the Plan from
the other Investment Fund(s) shall be made in cash.
(2) Withdrawals and distributions under the Plan from
the Employer Stock Fund may be made in cash or in
full shares of Employer Stock, with any fractional
share paid in cash, as elected by the Participant.
For the cash portion of any distribution or
withdrawal, the Participant will receive the cash
proceeds from the sale of shares of Employer Stock
as of the sale date.
ARTICLE VIII
DIRECT ROLLOVERS
8.1 GENERAL. This Article applies to distributions made on or
after January 1, 1993. Notwithstanding any provision of the
Plan to the contrary that would otherwise limit a distributee's
election under this Article, 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 paid
directly to an eligible retirement Plan specified by the
distributee in a direct rollover.
8.2 DEFINITIONS.
(A) ELIGIBLE ROLLOVER DISTRIBUTION: An eligible rollover
distribution is 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
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).
(B) ELIGIBLE RETIREMENT PLAN: An eligible retirement Plan is
an individual retirement account described in section
408(a) of the Code, an individual retirement annuity
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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.
(C) DISTRIBUTEE: A distributee includes 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.
(D) DIRECT ROLLOVER: A direct rollover is a payment by the
Plan to the eligible retirement Plan specified by the
distributee.
(E) WAIVER OF NOTICE. If a distribution is one to which
Sections 401(a)(11) and 417 of the Internal Revenue Code
do not apply, such distribution may commence less than 30
days after the notice required under Section 1.411 (a)-
(11)(c) of the Income Tax Regulations is given, provided
that: (1) the plan administrator clearly informs the
Participant that the Participant has a right to a period
of at least 30 days after receiving the notice to consider
the decision of whether or not to elect a distribution
(and, if applicable, a particular distribution option),
and (2) the Participant, after receiving the notice,
affirmatively elects a distribution.
ARTICLE IX
TOP-HEAVY PROVISIONS
9.1 USE OF TOP-HEAVY PROVISIONS. If the Plan becomes a Top-Heavy
Plan in any Plan Year after December 31, 1983, the provisions of this
Article IX will supersede any conflicting provision in the Plan or the
Adoption Agreement. The Committee has sole responsibility to make the
determination as to the top-heavy status of the Plan.
9.2 TOP-HEAVY DEFINITIONS.
(A) KEY EMPLOYEE: Any Employee or former Employee (and the
Beneficiaries of such Employee) who at any time during the
determination period was an officer of the Employer if
such individual's annual Compensation exceeds 50% of the
dollar limitation under Section 415(b)(1)(A) of the Code,
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an owner (or considered an owner under Section 318 of the
Code) of one of the ten largest interests in the Employer
if such individual's Compensation exceeds 100% of the
dollar limitation under Section 415(c)(l)(A) of the Code,
a 5 per cent owner of the Employer, or a 1 per cent owner
of the Employer who has an annual Compensation of more
than $150,000. Annual compensation means compensation as
defined in Item B(4)(a) of the Adoption Agreement, but
including amounts contributed by the Employer pursuant to
a salary reduction agreement which are excludable from the
Employee's gross income under Section 125, Section
402(e)(3), Section 402(h)(1)(B) or Section 403(b) of the
Code. The determination period is the Plan Year
containing the Determination Date and the 4 preceding Plan
Years.
The determination of who is Key Employee will made by the
Committee in accordance with Section 41 6(i)(1) of the
Code and the regulations thereunder.
(B) TOP-HEAVY PLAN: This Plan, for any Plan Year beginning
after December 31, 1983, if any of the following
conditions exists:
(1) If the Top-Heavy Ratio for this Plan exceeds 60
percent and this Plan is not part of any Required
Aggregation Group or Permissive Aggregation Group of
plans.
(2) If this Plan is a part of a Required Aggregation
Group of plans but not part of a Permissive
Aggregation Group and the Top-Heavy Ratio for the
group of plans exceeds 60 percent.
(3) If this Plan is a part of a Required Aggregation
Group and part of a Permissive Aggregation Group of
plans and the Top-Heavy Ratio for the Permissive
Aggregation Group exceeds 60 percent.
(C) TOP-HEAVY RATIO: For purposes of determining if the Plan
is a Top-Heavy Plan:
(1) If the Employer maintains one or more defined
contribution plans (including any Simplified
employee pension Plan) and the Employer has not
maintained any defined benefit Plan which during the
5-year period ending on the Determination Date(s)
has or has had accrued benefits, the Top-Heavy Ratio
for this Plan alone or for the Required or
Permissive Aggregation Group as appropriate is a
fraction, the numerator of which is the sum of the
account balances of all Key Employees as of the
84
Determination Date(s) (including any part of any
account balance distributed in the 5-year period
ending on the Determination Date(s)), and the
denominator of which is the sum of all account
balances (including any part of any account balance
distributed in the 5-year period ending on the
Determination Date(s), both computed in accordance
with Section 416 of the Code and the regulations
thereunder. Both the numerator and denominator of
the Top-Heavy Ratio are increased to reflect any
contribution not actually made as of the
Determination Date, but which is required to be
taken into account on that date under Section 416 of
the Code and the regulations thereunder.
(2) If the Employer maintains one or more defined
contribution plans (including any Simplified
Employee Pension Plan) and the Employer maintains or
has maintained one or more defined benefit plans
which during the 5-year period ending on the
Determination Date(s) has or has had any accrued
benefits, the Top-Heavy Ratio for any Required or
Permissive Aggregation Group as appropriate is a
fraction, the numerator of which is the sum of
account balances under the aggregated defined
contribution plan or plans for all Key Employees
determined in accordance with (1) above, and the
Present Value of accrued benefits under the
aggregated defined benefit plan or plans for all Key
Employees as of the Determination Date(s), and the
denominator of which is the sum of the account
balances under the aggregated defined contribution
plan or plans for all Participants, determined in
accordance with (1) above, and the Present Value of
accrued benefits under the defined benefit plan or
plans for all Participants as of the Determination
Date(s), all determined in accordance with Section
416 of the Code and regulations thereunder. The
accrued benefits under a defined benefit plan in
both the numerator and denominator of the Top-Heavy
Ratio are increased for any distribution of an
accrued benefit made in the five-year period ending
on the Determination Date.
(3) For purposes of (1) and (2) above, the value of
account balances and the Present Value of accrued
benefits will be determined as of the most recent
Valuation Date that falls within or ends with the
12-month period ending on the Determination Date,
except as provided in Section 416 of the Code and
the regulations thereunder for the first and second
Plan years of a defined benefit Plan. The account
85
balances and accrued benefits of a Participant (a)
who is not a Key Employee but who was a Key Employee
in a prior year, or (b) who has not been credited
with at least one Hour of Service with any Employer
maintaining the Plan at any time during the five-
year period ending on the Determination Date will be
disregarded. The calculation of the Top-Heavy
Ratio, and the extent to which distributions,
rollovers, and transfers are taken into account will
be made in accordance with Section 416 of the Code
and the regulations thereunder. Voluntary
deductible employee contributions will not be taken
into account for purposes of computing the Top-Heavy
Ratio. When aggregating plans the value of account
balances and accrued benefits will be calculated
with reference to the Determination Dates that fall
within the same calendar year.
The accrued benefit of a Participant other than a
Key Employee shall be determined under (a) the
method, if any, that uniformly applies for accrual
purposes under all defined benefit plans maintained
by the Employer, or (b) if there is no such method,
as if such benefit accrued not more rapidly than the
slowest accrual rate permitted under the fractional
rule of Section 41 1(b)(1)(C) of the Code.
(D) PERMISSIVE AGGREGATION GROUP: The Required Aggregation
Group of plans p1us any other Plan or plans of the
Employer which, when considered as a group with the
Required Aggregation Group, would continue to satisfy the
requirements of Section 401(a)(4) and Section 410 of the
Code.
(E) REQUIRED AGGREGATION GROUP: (1) Each qualified Plan of the
Employer in which at least one Key Employee participates
or participated at any time during the determination
period (regardless of whether the Plan has terminated),
and (2) any other qualified Plan of Employer which enables
a Plan described in (1) to meet the requirements of
Section 401(a)(4) or Section 410 of the Code.
(F) DETERMINATION DATE: For purposes of determining if there
is a Key Employee and for calculating the Top-Heavy Ratio:
1) for any Plan Year subsequent to the first Plan Year,
the last day of the preceding Plan Year, and 2) for the
first Plan Year of the Plan, the last day of that year.
(G) VALUATION DATE: The date specified in Item B(14)(c) of the
Adoption Agreement as of which account balances or accrued
benefits are valued for purposes of calculating the Top-
Heavy Ratio.
86
(H) PRESENT VALUE: Present Value shall be based only on the
interest and mortality rates specified in the Adoption
Agreement.
9.3 MINIMUM ALLOCATION.
(A) Except as otherwise provided in Section 9.3(C) and (D)
below, the Employer Contributions and forfeitures
allocated on behalf of any Participant who is not a Key
Employee shall not be less than the lesser of three per
cent (3%) of such Participant's Compensation or in the
case where the Employer has no defined benefit Plan which
designates this Plan to satisfy Section 401 of the Code,
the largest percentage of Employer contributions and
forfeitures, as a percentage of the Key Employee's
Compensation, as limited by Section 401(a)(17) of the
Code, allocated on behalf of any Key Employee for that
year. The minimum allocation is determined without regard
to any Social Security contribution. This minimum
allocation shall be made even though, under other Plan
provisions, the Participant would not otherwise be
entitled to receive an allocation or would have received a
lesser allocation for the year because of (i) such
Participants failure to complete 1,000 Hours of Service
(or any other equivalent provided in the Plan) or (ii) the
Employee's failure to make mandatory contributions or
(iii) Compensation less than a stated amount.
(B) For purposes of computing the minimum allocation,
Compensation shall mean Compensation as defined in Section
6.6(A) as limited by Section 401(a)(17) of the Code.
(C) Section 9.3(A) shall not apply to any Participant who was
not employed by the Employer on the last day of the Plan
Year.
(D) Section 9.3(A) shall not apply to any Participant to the
extent the Participant is covered under any other plan or
plans of the Employer and the Employer has provided in
Item B(14) of the Adoption Agreement that the minimum
allocation or benefit requirement applicable to Top-Heavy
Plans will be met in the other plan or plans.
(E) The minimum allocation required (to the extent required to
be nonforfeitable under Section 416(b) of the Code) may
not be forfeited under Section 41l(a)(3)(B) or Section
411(a)(3)(D) of the Code.
(F) For each Plan Year in which the Paired Plans are Top-
Heavy, the Top-Heavy requirements set forth in Article
VIII of the Plan and Item B(14) of the Adoption Agreement
shall apply.
87
(G) Neither Before Tax Contributions nor Matching
Contributions may be taken into account for the purpose of
satisfying the minimum Top-Heavy contribution
requirements.
9.4 MINIMUM VESTING SCHEDULES. For any Plan Year in which this
Plan is a Top-Heavy Plan, the vesting schedule elected by the
Employer in Item B(14) and/or C(4)(d) of the Adoption Agreement
will automatically apply to the Plan. The minimum vesting
schedule applies to all benefits within the meaning of Section
411(a)(7) of the Code except those attributable to Employee
contributions, including benefits accrued before the effective
date of Section 416 and benefits accrued before the Plan became
a Top-Heavy Plan. Further, no decrease in a Participant's
nonforfeitable percentage may occur in the event the Plan's
status as a Top-Heavy Plan changes for any Plan Year. However,
this Section 9.4 does not apply to the account balance of any
Employee who does not have an Hour of Service after the Plan
has initially become a Top-Heavy Plan and such Employee's
account balance attributable to employer contributions and
forfeitures will be determined without regard to this Section
9.4.
ARTICLE X
TRUSTEE
10.1 TRUSTEE. The Trustee shall receive, hold, invest, administer
and distribute the Trust Fund in accordance with the provisions
of the Plan as herein set forth.
10.2 RECORDS AND ACCOUNTS OF TRUSTEE. The Trustee shall maintain
accurate and detailed records and accounts of all its
transactions of the Trust Fund, which shall be available at all
reasonable times for inspection or audit by any person
designated by the Employer and by any other person or entity to
the extent required by law.
10.3 REPORTS TO EMPLOYER. As soon as practicable following the
close of each accounting period and following the effective
date of the termination of the Plan, the Trustee shall file a
written report with the Employer. The report shall set forth
all transactions with respect to the Trust Fund during the
period listing the Trust Fund assets with their market value as
of the close of the period covered by the report.
10.4 POWERS OF TRUSTEE. The Trustee shall administer the Trust Fund
as a nondiscretionary Trustee, and the Trustee shall not have
any discretion or authority with regard to the investment of
the Trust Fund shall act solely as a directed Trustee of the
fund contributed to it. The Trustee, as a nondiscretionary
Trustee, as may be directed by the Employer (or the
88
Participants to the extent provided herein) is authorized and
empowered, by way of limitation, with the following powers,
rights and duties, each of which the Trustee shall exercise in
a nondiscretionary manner as directed in accordance with the
direction of the Employer (or the Participants) as a Named
Fiduciary (except to the extent that Plan assets are subject to
the control and management of a properly appointed Investment
Manager):
(A) At the direction of the Named Fiduciary, to sell, write
options on, convey or transfer, invest and reinvest any
part thereof in each and every kind of property, whether
real, personal or mixed, tangible or intangible, whether
income or non-income producing and wherever situated,
including, but not limited to, time deposits (including
time deposits in the Trustee or its affiliates, or any
successor thereto, if the deposits bear a reasonable rate
of interest), fee simple, leasehold or lesser estates in
real estate, shares of common and preferred stock,
mortgages, bonds, leases, notes, debentures, equipment or
collateral trust certificates, rights, warrants,
convertible or exchangeable, and other corporate,
individual or government securities or obligations,
annuity, retirement or other insurance contracts, mutual
funds (including funds for which the Trustee or its
affiliates serve as investment advisor), units of group or
collective trusts established to permit the pooling of
funds of separate pension and profit sharing trusts,
provided the Internal Revenue Service has ruled such group
trust to be qualified under Code Section 401(a) and exempt
under Code Section 501(a) (or the applicable corresponding
provision of any other Revenue Act) or in units of any
other common, collective or commingled trust fund
heretofore or hereafter established and maintained by the
Trustee or its affiliates; as long as the Trustee holds
any units hereunder, the instrument establishing such
common trust fund (including all amendments thereto) shall
be deemed to have been adopted and made a part of this
Plan, and such other investments as the Named Fiduciary
shall direct the Trustee to invest Plan assets or hold as
an Investment Fund for the investment of Plan assets
pursuant to Participant direction.
(B) At the direction of the Named Fiduciary, to sell, convert,
redeem, exchange, grant options for the purchase or
exchange of, or otherwise dispose of any property held
hereunder, at public or private sale, for cash or upon
credit with or without security, without obligation on the
part of any person dealing with the Trustee to see to the
application of the proceeds of or to inquire into the
validity, expediency, or propriety of any such disposal;
89
(C) At the direction of the Named Fiduciary, to manage,
operate, repair, partition and improve and mortgage or
lease (with or without an option to purchase) for any
length of time any property held in the Trust Fund; to
renew or extend any mortgage or lease, upon such terms as
the Trustee may deem expedient; to agree to reduction of
the rate of interest on any mortgage; to agree to any
modification in the terms of any lease or mortgage, or of
any guarantee pertaining to either of them; to exercise
and enforce any right of foreclosure; to bid in property
on foreclosure; to take a deed in lieu of foreclosure with
or without paying consideration therefor and in connection
therewith to release the obligation on the bond secured by
the mortgage; and to exercise and enforce in any action,
suit or proceeding at law or in equity any rights,
covenants, conditions, or remedies with respect to any
lease or mortgage or to any guarantee pertaining to either
of them or to waive any default in the performance
thereof;
(D) In accordance with the direction of a Named Fiduciary, to
vote, personally or by general or limited proxy, any
shares of stock or other securities held in the Trust
Fund, provided that all voting rights pertaining to shares
of any financial institution in the state where the
Trustee is located shall be exercised by the trustee only
if and as directed in writing by the Committee; provided
further, that the Trustee and the Employer may agree in
writing that such voting rights be passed through to the
Participant's in proportion to their interest in the
Investment Funds, to delegate discretionary voting power
to the trustees of a voting trust for any period of time;
and to exercise or sell, personally or by power of
attorney, any conversion or subscription or other rights
appurtenant to any securities or other property held in
the Trust Fund;
(E) As may be directed by the Named Fiduciary, to join in or
oppose any reorganization, recapitalization,
consolidation, merger or liquidation, or any Plan
therefor, or any lease (with or without an option to
purchase), mortgage or sale of the property of any
organization the securities of which are held in the Trust
Fund; to pay from the Trust Fund any assessments, charges,
or compensation specified in any Plan of reorganization,
recapitalization, consolidation, merger or liquidation; to
deposit any property with any committee or depository; and
to retain any property allotted to the Trust Fund in any
reorganization, recapitalization, consolidation, merger or
liquidation;
90
(F) In accordance with the written instructions of a Named
Fiduciary, to settle, compromise or commit to arbitration
any claim, debt or obligation of or against the Trust
Fund; to enforce or abstain from enforcing any right,
claim, debt, or obligation; and to abandon any property
determined by it to be worthless;
(G) As may be directed by the Named Fiduciary, to continue to
hold any property of the Trust Fund, whether or not
productive of income; to reserve from investment and keep
unproductive of income, without liability for interest,
such cash as it deems advisable and, consistent with its
obligations as Trustee hereunder, to hold such cash in a
demand deposit in the Trustee bank, its affiliates, or any
successor thereto;
(H) To hold property of the Trust Fund in its own name, or in
the name of nominee, without disclosure of this trust, or
in bearer form so that it may pass by delivery, and to
deposit property with any depository, but no such holding
or depositing shall relieve the Trustee of its
responsibility for the safe custody and disposition of the
Trust Fund in accordance with the provisions of this
agreement as may be directed by the Named Fiduciary, and
the Trustee's records shall at all times show that such
property is part of the Trust Fund;
(I) As directed by the Named Fiduciary, to make, execute and
deliver, as Trustee, any deeds, conveyances, leases (with
or without option to purchase), mortgages, options,
contracts, waivers, or other instruments that the Trustee
shall deem necessary or desirable in the exercise of its
powers under this agreement;
(J) To employ, at the expense of the Employer or the Trust
Fund, agents and delegate to them such duties as the
Trustee sees fit; the Trustee shall not be responsible for
any loss occasioned by any such agents selected by it with
reasonable care; the Trustee may consult with legal
counsel (who may be counsel for the Employer) concerning
any questions which may arise with reference to its power
or duties under this Plan, and the written opinion of such
counsel shall be full and complete protection with respect
to any action taken or not taken by the Trustee in good
faith and in accordance with the written opinion of such
counsel;
(K) To pay out of the Trust Fund any taxes imposed or levied
with respect to the Trust Fund and may contest the
validity or amount of any tax, assessment, penalty, claim
or demand respecting the Trust Fund; however, unless the
Trustee shall have first been indemnified to its
91
satisfaction, it shall not be required to contest the
validity of any tax, or to institute, maintain or defend
against any other action or proceeding either at law or in
equity;
(L) To make loans to Participants in accordance with policies
established by the Committee and in accordance with the
terms of the Plan and the and to segregate or otherwise
identify property of the Trust Fund as directed by the
Committee for such purpose including providing collateral
for loans made pursuant to the Plan.
10.5 TRUSTEE'S FEES AND EXPENSES. The Trustee shall be entitled to
receive reasonable fees for its services hereunder in
accordance with its schedule of fees then in effect and shall
be entitled to receive reimbursement for all reasonable
expenses incurred by it in the administration of this Plan.
Except to the extent that the Employer shall pay such fees and
expenses, they shall be charged to and collected by the Trustee
from each Participant's accounts. The Trustee's fees and
expenses for extraordinary services in connection with any
Participant's accounts may be charged to and collected by the
Trustee from such accounts.
10.6 TRUSTEE MAY RESIGN OR BE REMOVED. The Trustee may resign by
written notice to the Employer which shall be effective sixty
(60) days after delivery unless the Trustee and the Employer
agree to an earlier effective date. The Trustee may be removed
by the Employer by written notice to the Trustee which shall be
effective sixty (60) days after delivery unless the Trustee and
the Employer agree to an earlier effective date. Prior to the
effective date of such resignation or removal, the Employer
shall amend its Plan to eliminate any reference to the PRISM{R}
PROTOTYPE RETIREMENT PLAN AND TRUST, and appoint a new trustee.
The Trustee shall deliver the Trust Fund to its successor on
the effective date of resignation or removal, or as soon after
such effective date as practicable. However, the Trustee may
first subtract any amounts owed it from the Trust Fund for
compensation, expenses and taxes due.
If the Employer fails to so amend the Plan and appoint a
successor trustee within the sixty (60) days, or longer period
as the Trustee permits in writing, the Trustee shall apply to a
court of competent jurisdiction for appointment of a successor
trustee.
10.7 SEPARATE INVESTMENT FUNDS.
(A) The assets of the Trust Fund shall be held in such number
of Investment Funds as the Employer and the Trustee may
agree, plus an Employer Stock Fund if selected by the
Employer in the Adoption Agreement, as the Employer shall
92
designate in writing on the Investment Fund Designation
form affixed to the Adoption Agreement. Such Investment
Funds shall be selected by the Employer from among the
funds offered by the Trustee for use as Investment Funds
in the PRISM{R} PROTOTYPE RETIREMENT PLAN & TRUST. The
Trustee reserves the right to change the funds available
for use as Investment Funds in the PRISM{R} Prototype
Retirement Plan & Trust, from time to time, and the
Employer agrees to execute an amended Investment Fund
Designation form to reflect any such changes as may impact
the Investment Funds Available to the Employer's Plan.
The Employer hereby acknowledges that, available as
Investment Funds are interests in registered investment
companies (i.e. mutual funds) for which the sponsoring
organization, its parent, affiliates or successors may
serve as investment advisor and receive compensation from
the registered investment company for its services as
investment advisor. The Employer acknowledges that it, as
Named Fiduciary, has the sole responsibility for selection
of the Investment Funds offered under the Plan, and it has
done so on the basis of the Employer's determination,
after due inquiry, of the appropriateness of the selected
Investment Funds as vehicles for the investment of Plan
assets pursuant to the terms of the Plan, considering all
relevant facts and circumstances, including but not
limited to (i) the investment policy and philosophy of the
Employer developed pursuant to ERISA Section 402(b)(1);
(ii) the Participants, including average level of
investment experience and sophistication; (iii) the
ability of Participants, using an appropriate mix of
Investment Funds, to diversify the investment of Plan
assets held for their benefit; (iv) the ability of
Participants to, utilizing an appropriate mix of
Investment Funds, to structure an investment portfolio
within their account in the Plan with risk and return
characteristics within the normal range of risk and return
characteristics for individuals with similar investment
backgrounds, experience and expectations; and, (v) in
making the selection of Investment Funds, the Employer did
not rely on any representations or recommendations from
the Trustee or any of its employees, except as may have
been provided through written materials, including
marketing materials provided by the various sponsors or
distributors of the Investment Funds, and that the
Investment Fund selection has not be influenced, approved,
or encouraged through the actions of the Trustee or its
employees.
For purposes of the Plan, "Employer Stock" shall mean
common stock listed on a recognized securities exchange
issued by an Employer of Employees covered by the Plan or
by an affiliate of such Employer and which shall be a
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"qualifying employer security's' as defined in ERISA. The
Employer Stock Fund shall be invested and reinvested in
shares of Employer Stock, which stock shall be purchased
by the Trustee to the extent not contributed to the Plan
by the Employer, except for amounts which may reasonably
be expected to be necessary to satisfy distributions to be
made in cash. No Employer Stock shall be acquired or held
in any Investment Fund other than the Employer Stock Fund.
Up to 100% of the assets of the Trust Fund may be invested
in Employer Stock.
All contributions shall be allocated by the Trustee to the
Plan's Investment Funds specified by the Employer.
Dividends, interest and other distributions shall be
reinvested in the same Investment Fund from which
received.
Employers sponsoring 401(k) profit-sharing plans may elect
to determine the Investment Funds, including an Employer
Stock Fund, if applicable, into which Matching
Contributions and/or Employer Contributions will be
invested and/or into which Participants may not direct
contributions. By making these designations, the Employer
shall be deemed to have advised the Trustee in writing
regarding the retention of investment powers.
Notwithstanding the foregoing provisions of this Section
10.7(A), the Trustee may, in its discretion, accept
certain investments which have been, and are, held as part
of the Trust Fund prior to the date the Employer adopted
this Plan. Such investments shall be considered
investments directed by the Employer or an Investment
Committee for the Plan ("Investment Committee"), if one is
acting. The Trustee shall hold, administer and dispose of
such investments in accordance with directions to the
Trustee contained in a written notice from the Employer or
Investment Committee. Any such notice shall advise the
Trustee regarding the retention of investment powers by
the Employer or the Investment Committee and shall be of a
continuing nature or otherwise, and may be revoked in
writing by the Employer or Investment Committee.
The Trustee shall not be liable but shall be fully
protected by reason of its taking or refraining from
taking any action at the direction of the Employer or
Investment Committee, nor shall the Trustee be liable but
shall be fully protected by reason of its refraining from
taking any action because of the failure of the Employer
or the Investment Committee to give a direction or order.
The Trustee shall be under no duty to question or make
inquiry as to any direction, notification or order or
failure to give a direction, notification or order by the
94
Employer or the Investment Committee. The Trustee shall
be under no duty to make any review of investments
directed by the Employer or Investment Committee acquired
for the Trust Fund and under no duty at any time to make
any recommendation with respect to disposing of or
continuing to retain any such investments. While the
Employer may direct the Trustee with respect to Plan
investments, the Employer may not (1) borrow from the Fund
or pledge any assets of the Fund as security for a loan;
(2) buy property or assets from or sell property or assets
to the Fund; (3) charge any fee for services rendered to
the Fund; or (4) receive any services from the Fund on a
preferential basis.
The Employer hereby indemnifies and holds the Trustee or
its nominee harmless from any and all actions, claims,
demands, liabilities, losses, damages or reasonable
expenses of whatsoever kind and nature in connection with
or arising out of (1) any action taken or omitted in good
faith or any investment or disbursement of any part of the
Trust Fund made by the Trustee in accordance with the
directions of the Employer or the Investment Committee or
any inaction with respect to any Employer or Investment
Committee directed investment or with respect to any
investment previously made at the direction of the
Employer or Investment Committee in the absence of
directions from the Employer or Investment Committee
therefor, or (2) any failure by the Trustee to pay for any
property purchased by the Employer or the Investment
Committee for the Trust Fund by reason of the
insufficiency of funds in the Trust Fund.
Anything hereinabove to the contrary notwithstanding, the
Employer shall have no responsibility to the Trustee under
the foregoing indemnification if the Trustee knowingly
participated in or knowingly concealed any act or omission
of the Employer or Investment Committee knowing that such
act or omission constituted a breach of fiduciary
responsibility, or if the Trustee fails to perform any of
the duties undertaken by it under the provisions of this
Plan, or if the Trustee fails to act in conformity with
the directions of an authorized representative of the
Employer or the Investment Committee.
(B) Each Participant shall by such mechanism as may be agreed
upon between the Trustee and Employer, direct that the
contributions made to his or her accounts for which the
Participant may direct investments, as selected by the
Employer in the Adoption Agreement, be invested in one or
more of the Investment Funds, including the Employer Stock
Fund, if applicable. At the time the Employee becomes
eligible for the Plan, he or she shall specify the
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percentage of his or her accounts (expressed in percentage
increments as may be agreed to between the Employer and
the Trustee) to be invested pro-rata in each such
Investment Fund.
(C) Upon prior written notice to the Trustee, or other form of
notice acceptable to the Trustee, a Participant may change
an investment direction with respect to future
contributions. Through acceptable notice to the Trustee,
the Participant may elect to transfer all or a portion of
such Participant's interest in each Investment Fund (based
on the value of such interest on the Valuation Date
immediately preceding such election), including an
Employer Stock Fund, if applicable, to any other of the
Investment Funds selected by the Employer so that the
Participant's interest in the said Investment Funds
immediately after the transfer is allocated in percentage
increments as may be agreed to by the Employer and the
Trustee.
Notwithstanding any Participant's election to change
Investment Funds, the Trustee may, in its discretion,
delay satisfaction of requests to change from a guaranteed
investment contract fund for up to one year, or delay
satisfaction of changes in Investment Funds pending
settlement of prior changes in Investment Funds.
(D) The Employer will be responsible when transmitting
Employer and Employee contributions to show the dollar
amount to be credited to each Investment Fund for each
Employee.
(E) Except as otherwise provided in the Plan, neither the
Trustee, nor the Employer, nor any fiduciary of the Plan
shall be liable to the Participant or any of his or her
beneficiaries for any loss resulting from action taken at
the direction of the Participant.
(F) In a 401(k) profit sharing Plan where the Employer has
elected to invest a portion or all of the Matching
Contributions and/or Employer Contributions in the
Employer Stock Fund, then the following shall apply:
If selected by the Employer in the Adoption Agreement, a
Participant who is fifty-five (55) years of age or older
and who is 100% vested in his Matching Contribution
account and/or Employer Contribution account may elect to
have the Employer Stock (and any earnings thereon)
attributable to such Matching Contributions and/or
Employer Contributions diversified in the other Investment
Funds under the Plan in accordance with the following
rules and limitations. The amount of Employer Stock which
96
may be diversified each Plan Year shall be determined in
accordance with the following schedule:
If the age attained then the percent of
by the Participant the number of whole
during the Plan shares (rounded to
Year is: the nearest whole
number) credited to
the Participants'
Matching Account
and/or Employer
Contribution
Account on the last
day of the
preceding Plan Year
which may be
diversified
pursuant to the
rules below may not
exceed
55 25%
56 25%
57 30%
58 40%
59 50%
60 60%
61 70%
62 80%
63 90%
64 100%
The election to diversify may only be made once each Plan
Year. The election may be made in any month by providing
notice to the Committee in accordance with the frequency
selected by the Employer for other Investment Fund changes
under the Plan. Each election to make a transfer pursuant
to this Section shall specify the Investment Fund(s) into
which the shares subject to diversification will be
reinvested so that the Participant's interest in the said
Investment Fund(s), immediately after the transfer, is
allocated in increments as may be allowed by the Trustee.
Thereafter, the Participant's interest in said Investment
Fund(s) shall be subject to transfer in accordance with
this Section.
97
(G) Forfeitures arising under the Plan will be invested in an
Investment Fund as may be selected in the discretion of
the Employer.
(H) In the event the Trust holds life insurance, the following
restrictions shall apply:
(1) Limitations on Premium Payments
(a) If ordinary or whole life insurance contracts
are purchased on the life of a Participant,
less than one-half of the insured
Participant's current allocation of
contributions will be used to pay premiums
attributable to such insurance. Ordinary or
whole life insurance contracts are those with
both nondecreasing benefits and nonincreasing
premiums.
(b) If term or universal life insurance contracts
are purchased, no more than one-quarter of
the insured Participant's current allocation
of will be used to pay premiums attributable
to such insurance.
(c) If a combination of ordinary or whole life
insurance contracts and term or universal
life insurance contracts are purchased, the
sum of one-half of the ordinary life
insurance premiums and all other life
insurance premiums will not exceed one-fourth
of the aggregate employer contributions
allocated to any participant.
(2) The Plan Administrator will direct the Trustee to
convert the entire value of any life insurance
contract at or before the Participant's actual
retirement or distribution on termination of
employment, but not later than the Participant's
Required Beginning Date to provide cash values or
retirement annuity income, or, subject to the Joint
and Survivor Annuity waiver requirements of Section
7.10, the Plan Administrator may direct the Trustee
to distribute the insurance contract directly to the
Participant.
(3) The Trustee, at the direction of the Employer shall
be entitled to exercise all rights and options with
respect to any such life insurance contracts held by
the Plan.
98
10.8 REGISTRATION, DISTRIBUTION AND VOTING OF EMPLOYER STOCK AND
PROCEDURES REGARDING TENDER OFFERS.
(A) All voting rights on shares of Employer Stock held in the
Employer Stock Fund shall be exercised by the Trustee only
as directed by the Participants acting in their capacity
as "Named Fiduciaries" (as defined in Section 402 of the
Act) in accordance with the following provisions of this
Section 10.8(A):
(1) As soon as practicable before each annual or special
shareholders' meeting of the Employer, the Trustee
shall furnish to each Participant sufficient copies
of the proxy solicitation material sent generally to
shareholders, together with a form requesting
confidential instructions on how the shares of
Employer Stock allocated to such Participant's
account, and, separately, such shares of Employer
Stock as may be unallocated ("Unallocated Shares")
or allocated to Participant accounts but for which
the Trustee does not receive timely voting
instruction from the Participant ("Non-Directed
Shares"), (including fractional shares to 1/1000th
of a share) are to be voted. The direction with
respect to Non-Directed Shares and Unallocated
Shares shall apply to such number of votes equal to
the total number of votes attributable to Non-
Directed Shares and Unallocated Shares multiplied by
a fraction, the numerator of which is the number of
shares of Employer Stock credited to the
Participant's account and the denominator of which
is the total number of shares credited to the
accounts of all such Participants who have timely
provided directions to the Trustee with respect to
Non-Directed Shares and Unallocated Shares under
this Section 10.8(A)(l). The Employer and the
Committee will cooperate with the Trustee to ensure
that Participants receive the requisite information
in a timely manner. The materials furnished to the
Participants shall include a notice from the Trustee
that the Trustee will vote any shares for which
timely instructions are not received by the Trustee
as may be directed by those voting Participants,
acting in their capacity as Named Fiduciaries of the
Plan as provided above. Upon timely receipt of such
instructions, the Trustee shall vote the shares as
instructed. The instructions received by the
Trustee from Participants or Beneficiaries shall be
held by the Trustee in strict confidence and shall
not be divulged or released to any person including
directors, officers or employees of the Employer, or
99
of any other company, except as otherwise required
by law.
(2) With respect to all corporate matters submitted to
shareholders, all shares of Employer Stock shall be
voted only in accordance with the directions of such
Participants as Named Fiduciaries as given to the
Trustee as provided in Section 10.8(A)(l). With
respect to shares of Employer Stock allocated to the
account of a deceased Participant, such
Participant's Beneficiary, as Named Fiduciary, shall
be entitled to direct the voting of share of
Employer Sock as if such Beneficiary were the
Participant.
(B) All tender or exchange decisions with respect to Employer
Stock held in the Employer Stock Fund shall be made only
by the Participants acting in their capacity as Named
Fiduciaries with respect to the Employer Stock allocated
to their accounts in accordance with the following
provisions of this Section 10.8(B):
(1) In the event an offer shall be received by the
Trustee (including a tender offer for shares of
Employer Stock subject to Section 14(d)(1) of the
Securities Exchange Act of 1934 or subject to Rule
13e-4 promulgated under that Act, as those
provisions may from time to time be amended) to
purchase or exchange any shares of Employer Stock
held by the Trust, the Trustee will advise each
Participant who has shares of Employer Stock
credited to such Participant's account in writing of
the terms of the offer as soon as practicable after
its commencement and will furnish each Participant
with a form by which he may instruct the Trustee
confidentially whether or not to tender or exchange
shares allocated to such Participant's account, and,
separately, Unallocated Shares and Non-Directed
Shares (including fractional shares to 1/1000th of a
share). The directions with respect to Non-Directed
Shares and Unallocated Shares shall apply to such
number of Non- Directed Shares and Unallocated
Shares equal to the total number of Non-Directed
Shares and Unallocated Shares multiplied by a
fraction, the numerator of which is the number of
shares of Employer Stock credited to the
Participant's account and the denominator of which
is the total number of shares credited to the
accounts of all such Participants who have timely
provided directions to the Trustee with respect to
Non-Directed Shares and Unallocated Shares under
this Section 10.8(B). The materials furnished to
100
the Participants shall include (i) a notice from the
Trustee that, except as provided in this Section
10.8(B), the Trustee will not tender or exchange any
shares for which timely instructions are not
received by the Trustee and (ii) such related
documents as are prepared by any person and provided
to the shareholders of the Employer pursuant to the
Securities Exchange Act of 1934. The Committee and
the Trustee may also provide Participants with such
other material concerning the tender or exchange
offer as the Trustee or the Committee in its
discretion determines to be appropriate; provided,
however, that prior to any distribution of materials
by the Committee, the Trustee shall be furnished
with sufficient numbers of complete copies of all
such materials. The Employer and the Committee will
cooperate with the Trustee to ensure that
Participants receive the requisite information in a
timely manner.
(2) The Trustee shall tender or not tender shares or
exchange shares of Employer Stock (including
fractional shares to 1/1000the of a share) only as
and to the extent instructed by the Participants as
Named Fiduciaries as provided in Section 10.8(B)(1).
With respect to shares of Employer Stock allocated
to the account of a deceased Participant, such
Participant's Beneficiary, as a Named Fiduciary,
shall be entitled to direct the Trustee whether or
not to tender or exchange such shares as if such
Beneficiary were the Participant. If tender or
exchange instructions for shares of Employer Stock
allocated to the account of any Participant are not
timely received by the Trustee, the Trustee will
treat the non-receipt as a direction not to tender
or exchange such shares. The instructions received
by the Trustee from Participants or Beneficiaries
shall be held by the Trustee in strict confidence
and shall not be divulged or released to any person,
including directors, officers or employees of the
Employer, or of any other company, except as
otherwise required by law.
(3) In thee event, under the terms of a tender offer or
otherwise, any shares of Employer Stock tendered for
sale, exchange or transfer pursuant to such offer
may be withdrawn from such offer, the Trustee shall
follow such instructions respecting the withdrawal
of such securities from such offer in the same
manner and the same proportion as shall be timely
received by the Trustee from the Participants, as
Named Fiduciaries, entitled under this Section
101
10.8(B) to give instructions as to the sale,
exchange or transfer of securities pursuant to such
offer.
(4) In the event an offer shall be received by the
Trustee and instructions shall be solicited from
Participants pursuant to Section 10.8(B)(1-3)
regarding such offer, and prior to termination of
such offer, another offer is received by the Trustee
for the securities subject to the first offer, the
Trustee shall use its best efforts under the
circumstances to solicit instructions from the
Participants to the Trustee (i) with respect to
securities tendered for sale, exchange or transfer
pursuant to the first offer, whether to withdraw
such tender, if possible, and, if withdrawn, whether
to tender any securities so withdrawn for sale,
exchange or transfer pursuant to the second offer
and (ii) with respect to securities not tendered for
sale, exchange or transfer pursuant to the first
offer, whether to tender or not to tender such
securities for sale, exchange or transfer pursuant
to the second offer. The Trustee shall follow all
such instructions received in a timely manner from
Participants in the same manner and in the same
proportion as provided in Section 10.8(B)(1-3).
With respect to any further offer for any Employer
Stock received by the Trustee and subject to any
earlier offer (including successive offers from one
or more existing offerors), the Trustee shall act in
the same manner as described above.
(5) A Participant's instructions to the Trustee to
tender or exchange shares of Employer Stock will not
be deemed a withdrawal or suspension from the Plan
or a forfeiture of any portion of the Participant's
interest in the Plan. Funds received in exchange
for tendered shares will be credited to the account
of the Participant whose shares were tendered and
will be used by the Trustee to purchase Employer
Stock, as soon as practicable. In the interim, the
Trustee will invest such funds in short-term
investments permitted under the Plan, and in the
same manner in which forfeited amounts are invested.
(6) In the event the Employer initiates a tender or
exchange offer, the Trustee may, in its sole
discretion, enter into an agreement with the
Employer not to tender or exchange any shares of
Employer Stock in such offer, in which event, the
foregoing provisions of this Section 10.8(B) shall
have no effect with respect to such offer and the
102
Trustee shall not tender or exchange any shares of
Employer Stock in such offer.
(C) The Trustee acting with respect to the Employer Stock Fund
may with the consent of the Committee designate any
Employee or other Trustee as agent to solicit the
instructions to vote provided for in Subsection (A) of
this Section, and shall be held harmless in relying upon
such agent's written advice as to how shares are to be
voted, and said Trustee may, with the consent of the
Committee, designate any Employee as agent to solicit
instructions from Participants regarding such a tender
offer, as required under Subsection (B) above, and shall
be held harmless in relying upon such agent's written
advice as to whether shares of Employer Stock are to be
tendered.
(D) The Employer shall be responsible for complying with
applicable federal and state securities laws and
regulations.
10.9 VALUATION OF IN VESTMENT FUNDS AND ACCOUNTS.
(A) As of each Valuation Date, the Trustee shall determine the
fair market value of each Investment Fund, including an
Employer Stock Fund, if any, being administered by the
Trustee. With respect to each such Investment Fund, the
Trustee shall determine (a) the change in value between
the current Valuation Date and the then last preceding
Valuation Date, (b) the net gain or loss resulting from
expenses paid (including fees and expenses, if any, which
are to be charged to such Fund) and (c) realized and
unrealized gains and losses.
The transfer of funds to or from an Investment Fund
pursuant to Section 10.7(C) and payments, distributions
and withdrawals from an Investment Fund to provide
benefits under the Plan for Participants or Beneficiaries
shall not be deemed to be gains, expenses or losses of an
Investment Fund.
After each Valuation Date, the Trustee shall allocate the
net gain or loss of each Investment Fund as of such
Valuation Date to the accounts of Participants
participating in such Investment Fund on such Valuation
Date. Contributions, forfeitures and rollovers received
and credited to Participants' accounts as of such
Valuation Date, or as of any earlier date since the last
preceding Valuation Date shall not be considered in
allocating gains or losses allocated to Participants'
accounts.
103
(B) The reasonable and equitable decision of the Trustee as to
the value of each Investment Fund, including an Employer
Stock Fund, if any, and of any account as of each
Valuation Date shall be conclusive and binding upon all
persons having any interest, direct or indirect, in thee
Investment Funds or in any account.
ARTICLE XI
ADMINISTRATION
11.1 COMMITTEE MEMBERSHIP. The Employer shall appoint a Committee
which shall consist of at least one member. The Committee
members will be named in thee Adoption Agreement and may be,
but are not required to be, Employees of the Employer. All
members of the Committee shall serve at the pleasure of the
Employer. In the event that the Committee has more than one
member, one member shall serve as Chairman and one as
Secretary. Any member of the Committee may resign by notice in
writing to thee Employer. Any vacancy in the Committee shall
be filled by the Employer as soon as practicable after a
vacancy. If thee Employer does not designate a Committee, the
Employer shall assume all of the duties of the Committee.
11.2 POWERS AND DUTIES OF COMMITTEE. The Committee shall have all
powers and duties and only the powers and duties as are
specifically conferred upon it by this Plan or as the Employer
may delegate to or impose upon it consistent with the
provisions of this Plan, ERISA and the Code. Without limiting
the generality of the foregoing, the Committee shall have the
following powers and duties:
(A) to interpret and construe the terms and provisions of this
Plan and to decide any questions which may arise
hereunder, including but not limited to --
(1) the amount of a Participant's Compensation,
(2) a Participant's Years of Service,
(3) the age of any person who might be entitled to
receive benefits,
(4) the right of any person to receive benefits,
(5) the amount of any benefits to be paid to any
persons;
(B) to cause to be maintained all necessary records and
accounts under this Plan and to keep in convenient form
any data as may be necessary for valuation of the assets
and liabilities;
104
(C) to rely upon the records of the Employer or upon any
certificate, statement or other representation made to it
by a Participant, a Beneficiary, the authorized
representative of the Participant or Beneficiary, or the
Trustee concerning any fact required to be determined
under any of the provisions of this Plan, and the
Committee shall not be required to make inquiry into the
propriety of any action by the Employer or thee Trustee;
(D) to give written notice to a Participant, a Beneficiary, or
the authorized representative of the Participant or
Beneficiary, of the amount of benefits payable under this
Plan;
(E) to make and enforce any rules, not inconsistent with this
Plan, as it shall deem necessary or proper for the
efficient administration of this Plan;
(F) to have and exercise such other authority as it deems
necessary to carry out the purposes and provisions of this
Plan, provided that any act of discretion permitted shall
be exercised in a uniform non-discriminatory manner with
respect to individuals in like or similar circumstances;
(G) to adopt rules and guidelines for the administration of
this Plan, provided that they are not inconsistent with
the terms of this Plan and are uniformly applicable to all
persons similarly situated and to delegate in accordance
with Section 11.8 such functions and duties as thee
Committee deems advisable;
(H) to establish a funding policy and investment objectives
consistent with thee purposes of the Plan and the
requirements of law;
(I) to employ such attorneys, accountants and agents as it
shall determine to assist it in carrying out its duties
hereunder.
Except as otherwise provided in this Plan or determined by the
Employer, any action or determination taken or made by the
Committee or any interpretation or construction made by the
Committee shall be final and shall be binding upon all persons.
The Committee shall at all times exercise the power and
authority given to it under this Plan in a fair, reasonable and
non-discriminatory manner.
11.3 ACTIONS OF THE COMMITTEE. Any act authorized or required to be
taken by the Committee shall be taken by a decision of the
majority of the members acting at the time. Any decision of
the Committee may be expressed by a vote at a Committee meeting
or in writing, signed by all members of the Committee, without
105
a meeting. All allocation statements, notices, directions,
approvals, instructions and all other communications required
or authorized to be given by the Committee under this Plan
shall be in writing and signed by a majority of the members of
the Committee. The Committee may, however, by an instrument in
writing signed by all the members and filed with the Trustee,
designate one or more if its members as having the authority to
sign all such communications on behalf of the Committee. Until
notified in writing to the contrary, the Trustee shall be fully
protected in acting in accordance with all communications which
it considers genuine and to have been signed on behalf of the
Committee by the members authorized to sign communications. If
at any time for any reason the Committee shall be unable to act
with respect to any matter, the Employer shall act with respect
to that matter and its action shall be final and it shall be
binding upon all persons.
11.4 RESIGNATION, REMOVAL AND DESIGNATION OF SUCCESSORS. Any member
of the Committee may resign at any time and any member may be
removed by the Employer with or without cause. In case of
resignation, death, removal or inability or failure for any
cause of any member of the Committee to serve or to continue to
serve, a successor shall be appointed by the Employer. The
Committee shall promptly notify the Trustee of any change in
its membership.
11.5 COMMITTEE REVIEW. If any Participant, Spouse, Beneficiary, or
other authorized representative of a Participant, Spouse or
Beneficiary shall file an application with the Committee for
benefits under the Plan and the application is denied, in whole
or in part, such applicant shall be notified of the denial in
writing within ninety (90) days of receipt of the claim. The
notice to the applicant shall state that the Committee has
denied the application pursuant to the exercise of its
discretionary powers. This notice shall set forth the specific
reasons for the denial, specific reference to pertinent Plan
provisions upon which the denial is based, a description of any
additional information needed to perfect the claim with an
explanation of why it is necessary and an explanation of
procedure for appeal.
Any Participant, Spouse, Beneficiary, or other authorized
representative of the Participant, Spouse or Beneficiary whose
application for benefits has been denied may, within sixty (60)
days after receiving thee notification, make a written
application to the Committee to review the denial. The
applicant may request that the review be made by written
statements submitted by the applicant and the Committee, at a
hearing, or by both. Any hearing shall be held in the main
offices of the Employer on a date and time as the Employer
shall designate with at least seven (7) days notice to the
applicant unless the applicant accepts shorter notice. Within
106
sixty (60) days after the review has been completed, the
Employer shall render a written decision and shall send a copy
to the applicant. This decision shall include specific reasons
for the decision, as well as specific references to the
pertinent Plan provisions upon which the decision is based.
If the Participant, Spouse, Beneficiary, or other authorized
representative of a Participant, Spouse or Beneficiary does not
file written notice with the Employer at the times set forth
above, the individual shall have waived all benefits under this
Plan other than as set forth in the notice from the Committee.
11.6 RECORDS. The Committee shall keep or cause to be kept records
of all meetings, proceedings and actions held, undertaken or
performed by it and shall furnish to the Employer reports as
the Employer may request.
11.7 COMPENSATION. The members of the Committee shall serve without
compensation for services as such, but all reasonably incurred
fees and expenses shall be paid by the Employer.
11.8 DESIGNATION OF NAMED FIDUCIARIES AND ALLOCATION OF
RESPONSIBILITY AMONG FIDUCIARIES. The Employer, the Committee
and the Trustee shall be "Named Fiduciaries" with respect to
this Plan as that term is defined in ERISA. The Named
Fiduciaries shall have only those specific powers, duties,
responsibilities and obligations as are given to them under
this Plan. The Named Fiduciaries may designate any person or
persons as a fiduciary and may delegate to such person or
persons any one or more of their powers, functions, duties and
responsibilities with respect to the Plan as set forth in this
Plan, authorizing or providing for such direction, information
or action. Any such designation shall be made in writing and
shall become effective upon written acceptance. No such
designation or delegation by the Employer or the Committee of
any of its powers, authority or responsibilities to the Trustee
shall become effective unless such designation or delegation
shall first be accepted by the Trustee in a writing signed by
it and delivered to the Employer or the Committee, as
applicable. Furthermore, each Named Fiduciary may rely upon
any such direction, information or action of another Named
Fiduciary as being proper under this Plan and is not required
to inquire into the propriety of any such direction,
information or action. It is intended that under this Plan
each Named Fiduciary shall be responsible for the proper
exercise of its own powers, duties, responsibilities and
obligations and shall not be responsible for act or failure to
act of another fiduciary.
11.9 NOTICE BY COMMITTEE OR EMPLOYER. Any communication or notice
to any person by the Committee or the Employer shall be in
writing and may be given by delivery to the person or by first
107
class mail with postage prepaid addressed to the person at the
last address on file with the Committee or the Employer. Any
notice delivered as provided above shall be deemed to have been
given when delivered, and any notice mailed as provided above
shall be deemed to have been given when mailed.
11.10 LOANS TO PARTICIPANTS.
(A) (1) In accordance with Section 11.8 above, the Committee
is hereby designated as the named fiduciary with
sole authority and responsibility to approve or deny
loans and, except as provided in subsections (G) and
(H) of this Section, collect unpaid loans, in
accordance with the provisions of this Section
11.10. This Section 11.10 shall apply if the
Employer is eligible to and elects Item B(16) of the
Adoption Agreement.
(2) Subject to the consent of the Committee, loans may
be made upon approval of the written application of
a Participant or Beneficiary submitted to the
Committee. Such application shall be submitted
during a specified period established by the
Committee prior to the date the loan is to be made.
The Committee shall notify the Participant or
Beneficiary whether the loan has been approved or
denied. Loans shall be made available to all
Participants and Beneficiaries on a reasonably
equivalent basis, except that no loans will be made
to any Stockholder-Employee or Owner-Employee and no
loan shall be made to any Participant which the
Committee, upon reviewing the Participant's written
application determines may be reasonably expected to
be unable to repay the loan. Loans shall not be
made available to Highly Compensated Employees (as
defined in Section 414(q) of the Code) in an amount
greater than the amount made available to other
Employees. Except for loans made prior to the date
this Plan is adopted, a Participant or Beneficiary
shall have no more than five loans outstanding at
any given time.
(3) All loans will be adequately secured and will bear a
reasonable rate of interest. Rates of interest will
be determined daily by the Trustee for Plan loans.
The Committee will determine the minimum loan
amount for the Plan.
(B) In reviewing and approving or denying loan applications
hereunder, the Committee shall bear sole responsibility
for ensuring compliance with all applicable federal or
state laws and regulations, including the federal Truth In
108
Lending Act (15 U.S.C. Section 1601 et seq.), and Equal
Credit Opportunity Act (15 U.S.C. Section 1691 et seq.).
The Committee shall upon request supply the Trustee with
evidence that it has complied with such federal or state
law.
(C) Notwithstanding Section 7.13 above, each loan made
hereunder shall be secured by a written assignment, in
favor of the Plan, of that portion of the Participant's
accounts which the Committee determines to be necessary to
adequately secure repayment of the loan.
(D) A Participant must obtain the consent of his or her
Spouse, if any, to use the account balance as security for
the loan. Spousal consent shall be obtained no earlier
than the beginning of the ninety (90) day period that ends
on the date the loan is to be so secured. The consent
must be in writing and must be witnessed by a Plan
representative or Notary Public. Such consent shall
thereafter be binding with respect to the consenting
spouse or any subsequent spouse with respect to that loan.
A new consent shall be required if the account balance is
used for renegotiation, extension, renewal, or other
revision of the loan.
Notwithstanding the preceding paragraph, no spousal
consent is required for the use of the account balance as
security for a Plan loan to the Participant under a safe-
harbor profit sharing Plan as described in Section
7.10(F).
(E) No loan shall be approved by the Committee to any
Participant or Beneficiary in any amount which exceeds the
lesser of
(1) $50,000, reduced by the excess (if any) of -
(a) the highest outstanding balance of loans from
the Plan during the one-year period ending on
the day before the date on which such loan
was made, over,
(b) the outstanding balance of loans from the
Plan on the date on which such loan was made,
or
(2) fifty percent (50%) of the present value of the
Participant's nonforfeitable accrued benefit.
For purposes of the above limitation, all loans from all
plans of the Employer and other members of a group of
109
employers described in Sections 4 14(b), (c), (m) and (o)
of the Code are aggregated.
The term of the loan shall be determined by the Committee.
Furthermore, any loan shall, by its terms require that
repayment (principal and interest) be amortized in level
payments, not less frequently than quarterly over a period
not extending beyond five years from the date of the loan,
except that the Committee, in its discretion, may permit a
repayment period in excess of five years for loans made to
a Participant or Beneficiary used to acquire a dwelling
unit which, within a reasonable time (determined at the
time the loan is made) will be used as a principal
residence of the borrower.
An assignment or pledge of any portion of the
participant's interest in the Plan will be treated as a
loan under this paragraph.
(F) Each loan hereunder shall be made pro rata from the
borrowing Participant's available accounts and Investment
Funds. Loan repayments shall generally be made via
payroll deduction, except that the repayment of
outstanding principal at maturity, in the event the loan
is called, or in the event the Participant chooses to
prepay the loan shall be made in such manner as the
Committee shall determine. Loan repayments and interest
thereon shall be credited to the Investment Funds and
accounts in accordance with current elections. No loan
shall be considered a general investment of the Trust
Fund. Each loan shall be evidenced by a written
agreement, evidencing the Participant's obligation to
repay the borrowed amount to the Plan, in such form and
with such provisions consistent with this Section 11.10 as
is acceptable to the Trustee. All loan agreements shall
be deposited with the Trustee.
(G) In the event a Participant does not repay the principal of
such loan or interest thereon at such times as are
required by the terms of the loan or if the Participant
ceases to be an Employee while such Participant has a loan
made hereunder which is outstanding, the Committee, in its
discretion, may direct the Trustee to take such action as
the Committee may reasonably determine, including:
(1) demand repayment of the loan and, subject to Section
10.4(K), institute legal action against the
Participant to enforce collection of any balance due
from the Participant, or
(2) demand repayment of the loan, and charge the total
amount of the unpaid loan and unpaid interest
110
against the balance credited to the Participant's
vested account balance which was assigned as
security for the loan and reduce any payment or
distribution from the Trust Fund to which the
Participant or the Participant's Beneficiary may
become entitled to the extent necessary to discharge
the obligation on the loan.
Notwithstanding the foregoing provisions of this Paragraph
(G), in the event of default, foreclosure on the note and
attachment of security will not occur until a
distributable event occurs in the Plan.
(H) In the event the Committee fails or refuses for any reason
to direct the Trustee as provided in Paragraph (G) above
or if the Trustee otherwise reasonably concludes that the
collectibility of a loan hereunder is in jeopardy, the
Trustee is authorized to take such action as it may
reasonably determine to enforce repayment and satisfaction
of the loan. The Employer shall be responsible for costs
and expenses incurred in collecting any loan balance.
(I) In the event that the amount of any payment or
distribution from the Trust Fund is insufficient to repay
the balance due on any loan, the Participant shall be
liable for and continue to make repayments on such
balance.
(J) If a valid spousal consent has been obtained in accordance
with Paragraph (D), then, notwithstanding any other
provision of this Plan, the portion of the Participant's
vested account balance used as a security interest held by
the Plan by reason of a loan outstanding to the
Participant shall be taken into account for purposes of
determining the amount of the account balance payable at
the time of death or distribution, but only if the
reduction is used as repayment of the loan. If less than
100% of the Participant's vested account balance
(determined without regard to the preceding sentence) is
payable to the surviving Spouse, then the account balance
shall be adjusted by first reducing the vested account
balance by the amount of the security used as repayment of
the loan, and then determining the benefit payable to the
surviving Spouse.
ARTICLE XII
FAILURE TO ATTAIN OR RETAIN QUALIFIED STATUS
12.1 FAILURE TO QUALIFY AS A PROTOTYPE. This Plan is established
with the intent that it shall qualify under Section 401 of the
Code and that it shall comply with ERISA and all other
111
applicable laws, regulations and rulings. It may be modified
and amended retroactively, if necessary, to secure such
qualification. Should the Internal Revenue Service determine
that this Plan does not qualify under the Code or any statute
of similar import, or fails or refuses to issue an opinion, and
if the Plan is not amended, as required to qualify, before the
time allowed by law for the Employer to file its corporate
federal tax return for the taxable year in which the Effective
Date occurs, the Plan shall be considered to be rescinded and
of no force and effect. Any assets attributable to
contributions made by the Employer shall be returned to the
Employer by the Trustee as soon as administratively feasible.
The Employer shall refund to the Participant any contributions
made by the Participant to the Plan.
12.2 FAILURE OF EMPLOYER TO ATTAIN OR RETAIN QUALIFICATION. If the
Employer's Plan fails to attain or retain qualification, such
Plan will no longer participate in this prototype Plan and will
be considered an individually designed Plan.
ARTICLE XIII
MISCELLANEOUS
13.1 EMPLOYER ACTION. Except as may be specifically provided
herein, any action required or permitted to be taken by the
Employer may be taken on behalf of the Employer by any officer
of the Employer.
13.2 NO GUARANTEE OF INTERESTS. Neither the Trustee, the Employer
nor any other named fiduciary in any way guarantees the Trust
Fund from loss or depreciation, nor do they guarantee any
payment to any person. The liability of the Trustee, the
Employer and a named fiduciary to make any payments hereunder
is limited to the available assets of the Trust Fund.
13.3 EMPLOYMENT RIGHTS. The Plan is not a contract of employment.
Participation in the Plan will not give any Participant the
right to be retained in the Employer's employ, nor any right or
claim to any benefit under the Plan, unless the right or claim
has specifically accrued under the Plan.
13.4 INTERPRETATIONS AND ADJUSTMENTS. To the extent permitted by
law, an interpretation of the Plan and a decision on any matter
within a named fiduciary's discretion made in good faith is
binding on all persons. A misstatement or other mistake of
fact shall be corrected when it becomes known and the person
responsible shall make such adjustment on account thereof as he
or she considers equitable and practicable.
13.5 UNIFORM RULES. In the administration of the Plan, uniform
rules will be applied to all Participants similarly situated.
112
13.6 EVIDENCE. Evidence required of anyone under the Plan may be by
certificate, affidavit, document or other information which the
person acting on it considers pertinent and reliable and
signed, made or presented by the proper party or parties.
13.7 WAIVER OF NOTICE. Any notice required under the Plan may be
waived by the person entitled to notice.
13.8 CONTROLLING LAW. The law of the state where the Trustee is
located shall be the controlling state law in all matters
relating to the Plan and shall apply to the extent that it is
not preempted by the laws of the United States of America.
13.9 TAX EXEMPTION OF TRUST. The trust herein created is designated
as constituting a part of a Plan intended to qualify under
Sections 401(a) of the Code and to be tax-exempt under Section
501(a) of the Code.
13.10 COUNTERPARTS. The Plan may be executed in two or more
counterparts, any one of which will be an original without
reference to the others.
13.11 ANNUAL STATEMENT OF ACCOUNT. The assets of the Trust Fund will
be valued annually at fair market as of the last day of each
Plan Year. On such date the earning and losses of the Trust
Fund will be allocated to each Participant's accounts in the
ratio that such account balance bears to all account balances.
The Trustee will deliver to the Employer a statement of each
Participant's account balances as of the last day of Plan Year.
13.12 NO DUTY TO INQUIRE. No person shall have any duty to make any
inquiry as to the application or use of the Trust Fund, or any
part thereof, or to inquire into the validity, expediency or
propriety of any matter or thing done or proposed to be done by
the Trustee.
13.13 INVALIDITY. In case any provisions of this Plan shall be
invalid, this fact shall not affect the validity of any other
provision on.
13.14 TITLES. Titles to Articles and Sections are for convenience
only and shall have no bearing upon the construction or
interpretation of this Plan.
13.15 NO DUTY OF TRUSTEE TO COLLECT CONTRIBUTIONS. The Trustee shall
be accountable for all contributions received but shall have no
duty to require any contributions to be delivered or to
determine if the contributions received comply with the Plan or
with any Board of Directors resolution of the Employer
providing for contributions.
113
13.16 TRUSTEE DISTRIBUTES BY COMMITTEE DIRECTION. The Trustee shall
make distributions only through Committee direction. The
Trustee shall have no responsibility to see how distributions
are applied or to ascertain whether the Committee's directions
comply with the Plan. Notwithstanding anything in the Plan to
the contrary, payments made in accordance with these provisions
will continue only so long as amounts remain in the
Participant's accounts.
ARTICLE XIV
AMENDMENT OR TERMINATION
14.1 AMENDMENT BY THE SPONSOR. Society National Bank, the
sponsoring organization, reserves the right without being
required to obtain the approval of the Employer to amend any
part of the Plan from time to time, subject to the provisions
of Article XII, Section 14.2 and the following:
(A) Except as provided in Section 14.1(B) and (C), no
amendment shall become effective until at least thirty
(30) days' prior written notice (unless the Employer
agrees to shorter notice) has been given to the Employer,
nor shall any such amendment reduce Participants' benefits
to less than the benefits to which they would have been
entitled if they had resigned from the employ of the
Employer on the effective date of the amendment;
(B) An amendment of the Plan and Trust which the sponsor deems
necessary to enable the Plan and Trust to meet the
requirements of Section 401(a) of the Code may be made
effective as of the date the Plan and Trust was
established by the sponsor or as of any subsequent date;
(C) An amendment of the Plan and Trust to conform the Plan and
Trust to any change in the law, regulations or rulings of
the United States may take effect as of the date such
amendment is required to be effective. Any amendment
executed pursuant to the provisions of this Section 14.1
shall be executed by an authorized officer of the sponsor,
or its successor. For purposes of this Section 14 over 1,
the Employer shall be deemed to have been furnished a copy
of any amendment on the business day next following the
mailing by the sponsor or the Trustee.
14.2 AMENDMENT BY ADOPTING EMPLOYER. The Employer may (1) change
the choice of options in the Adoption Agreement, (2) add
overriding language in the Adoption Agreement when such
language is necessary to satisfy Section 415 or Section 416 of
the Code because of the required aggregation of multiple plans,
and (3) add certain model amendments published by the Internal
Revenue Service which specifically provide that their adoption
114
will not cause the Plan to be treated as individually designed.
An Employer that amends the Plan for any other reason,
including a waiver of the minimum funding requirement under
Section 4 12(d) of the Code, will no longer participate in this
Master or Prototype Plan and will be considered to have an
individually designed Plan.
14.3 VESTING - PLAN TERMINATION. In the event of termination or
partial termination of the Plan, the account balance of each
affected Participant will be nonforfeitable.
14.4 VESTING - COMPLETE DISCONTINUANCE OF CONTRIBUTIONS. In the
event of a complete discontinuance of contributions under the
Plan, the account balance of each affected Participant will be
nonforfeitable.
14.5 PLAN MERGER - MAINTENANCE OF BENEFIT. In the event of a merger
or consolidation with, or transfer of assets to any other Plan,
each Participant will receive a benefit immediately after the
merger, consolidation or transfer (if the Plan then terminated)
which is at least equal to the benefit the Participant was
entitled to immediately before such merger, consolidation or
transfer (if the Plan had then terminated).
14.6 DIRECT TRANSFER. In its discretion, the Trustee may accept the
direct transfer of Plan assets from the trustee of other
retirement plans described in Code Section 401(a). If the Plan
receives a direct transfer of elective deferrals (or amounts
treated as elective deferrals) under a Plan with a Code Section
401(k) arrangement, the distribution restrictions of Code
Sections 401(k)(2) and (10) continue to apply to those
transferred elective deferrals.
14.7 TERMINATION OF PARTICIPATION BY EMPLOYER. The Employer expects
to continue its participation in this Plan indefinitely but
reserves the right to terminate this Plan as to its Employees
at any time by written instrument filed with the Trustee. In
the event of such termination, partial termination or complete
discontinuance of contributions, or termination as provided in
Section 13.3, the account balance of each affected Participant
will be nonforfeitable. Distribution to Participants who have
theretofore become entitled to the payment of any benefits
hereunder or to Spouses or Beneficiaries of deceased
Participants shall be made in the same manner as if the
Employer's participation had not terminated or contributions
had not been discontinued.
The account(s) of each such Participant, in the event of
payment in other than a single sum, need not be converted into
cash, but may continue to remain in the trust, with a right and
obligation thereafter to participate in the net earnings,
losses, taxes and expenses of the trust.
115
If any Participant shall die after the termination of the
Employer's participation and before all of said Participant's
interest has been paid, then, upon the written direction of
Employer, the entire undistributed portion shall be paid in a
single sum to the Participant's Beneficiary.
In the event of complete discontinuance of contributions, the
Employer shall terminate this Plan as to its Employees and each
Participant's interest shall be distributed to such
Participant.
14.8 NOTICE OF AMENDMENT, TERMINATION OR PARTIAL TERMINATION. The
Committee will notify affected Participants of an amendment,
termination or partial termination of the Plan within a
reasonable time.
14.9 SUBSTITUTION OF TRUSTEE. Any corporation or association into
which the Trustee may be converted, merged or with which it may
be consolidated, or an corporation or association resulting
from any conversion, merger, reorganization or consolidation to
which the Trustee may be a party, shall be the successor of the
Trustee hereunder without the execution or filing of any
instrument or the performance of any further act.
ARTICLE XV
DISCHARGE OF DUTIES BY FIDUCIARIES
15.1 DISCHARGE OF DUTIES. Subject to the provisions of Articles IX
and X, the Named Fiduciaries and any other fiduciary shall
discharge their respective duties set forth in the Plan solely
in the interest of the Participants and their Spouses and
Beneficiaries and:
(A) for the exclusive purpose of:
(1) providing benefits to Participants and their Spouses
and Beneficiaries; and
(2) defraying reasonable expenses of administering the
Plan;
(B) with the care, skill, prudence and diligence under the
circumstances then prevailing that a prudent person acting
in a like capacity and familiar with such matters would
use in the conduct of an enterprise of a like character
and with like aims; and
(C) by diversifying the investments of the Plan so as to
minimize the risk of large losses, unless under the
circumstances it is clearly prudent not to do so.
116
ARTICLE XVI
AMENDMENT AND CONTINUATION OF ORIGINAL PLAN
16.1 AMENDMENT AND CONTINUATION. Notwithstanding any of the
foregoing provisions of the Plan to the contrary, an Employer
which has previously established a profit sharing Plan and
trust or money purchase pension Plan and trust, as applicable,
(the "Original Plan") may, in accordance with the provisions of
the Original Plan, amend and continue that Plan in the form of
this Plan and Trust and become an Employer hereunder, subject
to the following:
(A) Subject to the conditions and limitations of the Plan,
each person who is a Participant or former Participant
under the Original Plan immediately prior to the Effective
Date of the amendment and continuation thereof in the form
of this Plan will continue as a Participant under this
Plan;
(B) The words "Original Plan" shall be substituted for the
word "Plan" where the word appears in Section 2.2 of the
Plan;
(C) No election may be made in the Adoption Agreement if such
election will reduce the benefits of a Participant under
the Original Plan to less than the benefits to which he
would have been entitled if he had resigned from the
employ of the Employer on the date of the amendment and
continuation of the Original Plan in the form of this
Plan;
(D) The amounts, if any, credited to a Participant's or former
Participant's accounts, immediately prior to the Effective
Date of the amendment and continuation of the Original
Plan in the form of this Plan shall constitute the opening
balances in his or her accounts, as appropriate, under
this Plan and Trust;
(E) Amounts being paid to a former Participant or Beneficiary
in accordance with the provisions of the Original Plan
shall continue to be paid in accordance with such
provisions; and
(F) Any Beneficiary designation in effect under the Original
Plan immediately before its amendment and continuation in
the form of this Plan shall be deemed to be a valid
Beneficiary designation filed with the Employer under
Section 7.7 of this Plan, to the extent consistent with
the provisions of this Plan, unless and until the
Participant or former Participant revokes such Beneficiary
designation or makes a new Beneficiary designation under
this Plan.
117
IN WITNESS WHEREOF, Society National Bank has established this
prototype Plan as of the 24th day of March, 1995.
SOCIETY NATIONAL BANK
Title: Senior Vice President and General Counsel
-----------------------------------------
118
03/24/95 Basic
Plan Document # 05
Plan # 002
IRS Letter Serial No.: D363689a
PRISM{R} PROTOTYPE RETIREMENT PLAN & TRUST
Section 401(k) Profit Sharing Plan
(Nonstandardized)
Adoption Agreement<1>
The Employer<2>, designated below, hereby establishes a profit-
sharing plan (optionally including a cash or deferred arrangement (as
defined in Section 401(k) of the Internal Revenue Code)) for all
Eligible Employees as defined in this Adoption Agreement pursuant to
the terms of the PRISM{R} PROTOTYPE RETIREMENT PLAN & TRUST BASIC PLAN
DOCUMENT # 05.
A. EMPLOYER INFORMATION:
1. NAME: IWC Resources Corporation
-------------------------
2. ADDRESS: 1220 Waterway Boulevard, P.O. Box 1220
--------------------------------------
3. Address: Indianapolis, IN 46206
----------------------
4. ATTENTION: Les M. Williams Telephone: 317-263-6359
--------------- ------------
5. EMPLOYER TAXPAYER IDENTIFICATION NUMBER<3>: 35-0414230
----------
____________________
<1>Footnotes in this Adoption Agreement are not to be construed
as part of the Plan provisions but are explanatory only. To the
extent a footnote is inconsistent with the provisions of the Basic
Plan Document or applicable law, the provisions of the Plan shall be
construed in conformity with the Basic Plan Document or law.
<2>Terms that are capitalized are defined in the PRISM{R}
Prototype Retirement Plan & Trust Basic Plan Document.
<3>The Plan will have an individual TIN, distinct from the
Employer TIN.
B. BASIC PLAN PROVISIONS:
1. Plan Name (select one):
a. /_/ This plan is established effective ________,
19__, (the "Effective Date") as a profit
sharing plan and trust (optionally with a
"cash or deferred arrangement" as defined in
Code Section 401(k)) to be known as _____
Plan and Trust (the "Plan") in the form of
the PRISM{R} Prototype Retirement Plan &
Trust.
b. /X/ This plan is an amendment and restatement in
the form of the PRISM{R} PROTOTYPE RETIREMENT
PLAN & TRUST, effective April 1, 1996, (the
"Effective Date") of the IWC RESOURCES
CORPORATION EMPLOYEE THRIFT Plan and Trust
(the "Plan"), originally effective as of
March 1, 1981 (the "Original Effective
Date").
2. EMPLOYER'S THREE DIGIT PLAN NUMBER: 003
3. COMMITTEE MEMBERS<4>:
EMPLOYEE BENEFITS COMMITTEE: JIM LATHROP, JAY
ROSENFELD, JOE BROYLES, LES WILLIAMS AND KEN GIFFIN
4. DEFINITIONS:
a. COMPENSATION for allocation purposes:
i Will be determined over the following
applicable period (select only one):
(a) /X/ the Plan Year
(b) /_/ the period of Plan participation
during the Plan Year
(c) /_/ a consecutive 12 month period
commencing on_____ and ending with,
or within, the Plan Year.
ii /X/ If selected, Compensation will include
Employer contributions made pursuant to
a Salary Reduction Agreement, or other
____________________
<4>Committee members direct the day to day operation of the Plan.
Committee members serve at the pleasure of the Employer. See Section
11.4 for changes in Committee membership. If no Committee members are
specified, the Employer shall assume responsibility for the operations
of the Plan.
Page 2
arrangement, which are not includible
in the gross income of the Employee
under Sections 125, 402(e)(3),
402(h)(1)(B) or 403(b) of the Internal
Revenue Code.
iii Shall NOT include (select as many as
desired):
(a) /_/ Bonuses
(b) /_/ Commissions
(c) /X/ Taxable fringe benefits identified
below:
INSURANCE, AUTO, AND RESTRICTED
STOCK
(d) /_/ Other items of remuneration
identified below:
_____
iv Shall be limited to $ ______ which shall be
the maximum amount of compensation considered
for plan allocation purposes (but not for
testing purposes), and may not be an amount
in excess of the Internal Revenue Code
Section 401(a)(17) limit in effect for the
Plan Year.<5> If no amount is specified,
Compensation shall be limited to the Internal
Revenue Code Section 401(a)(17) amount, as
adjusted by the Secretary of the Treasury
from time to time.
b. EARLY RETIREMENT DATE:
i /X/ is not applicable to this Plan
ii /_/ is the latter of the date on which the
Participant attains age _____ (not less
than 55) and the date on which the
Participant completes __ Years of
Service.
c. HOUR OF SERVICE shall be determined on the basis of
the method selected below. Only one method may be
selected. The method shall be applied to all
Employees covered under the Plan as follows (select
only one):
____________________
<5>If no amount is specified, the maximum amount of Compensation
allowed under Code Section 401(a)(17) (the "$150,000 limit" ("$200,000
limit" prior to the Plan Year beginning before January 1, 1994)), as
adjusted from time to time, shall be used.
Page 3
i /X/ On the basis of actual hours for which
an Employee is paid, or entitled to be
paid.
ii /_/ On the basis of days worked. An
Employee shall be credited with ten
(10) Hours of Service if under Section
1.1(U) of the Plan such Employee
would be credited with at least one (1)
Hour of Service during the day.
iii /_/ On the basis of weeks worked. An
Employee shall be credited with forty-
five (45) Hours of Service if under
Section 1.1(U) of the Plan such
Employee would be credited with at
least one (1) Hour of Service during
the week.
iv /_/ On the basis of semi-monthly payroll
periods. An Employee shall be credited
with ninety-five (95) Hours of Service
if under Section 1.1(U) of the Plan
such Employee would be credited with at
least one (1) Hour of Service during
the semi-monthly payroll period.
v /_/ On the basis of months worked. An
Employee shall be credited with one
hundred ninety (190) Hours of Service
if under Section 1.1(U) of the Plan
such Employee would be credited with at
least one (1) Hour of Service during
the month.
d. LIMITATION YEAR shall mean the 12 month period
commencing on January 1 and ending on December 31.
e. NORMAL RETIREMENT DATE for each Participant shall
mean (select one):
i /X/ the date the Participant attains age:
65 (not to exceed 65)
ii /_/ the latter of the date the Participant
attains age ____ (not to exceed 65) or
the ___ (not to exceed 5th) anniversary
of the participation commencement date.
If for the Plan Years beginning before
January 1, 1988, Normal Retirement Date
was determined with reference to the
anniversary of the participation
commencement date (more than 5 but not
to exceed 10 years), the anniversary
date for Participants who first
commenced participation under the Plan
before the first Plan Year beginning on
Page 4
or after January 1, 1988 shall be the
earlier of (A) the tenth anniversary of
the date the Participant commenced
participation in the Plan (or such
anniversary as had been elected by the
employer, if less than 10) or (B) the
fifth anniversary of the first day of
the first Plan Year beginning on or
after January 1, 1988. Notwithstanding
any other provisions of the Plan, the
participant commencement date is the
first day of the first Plan Year in
which the Participant commenced
participation in the Plan.
f. PERMITTED DISPARITY LEVEL, for purposes of
allocating Employer Contributions, shall mean
(select only one):
i /X/ Not applicable - the Plan does not use
permitted disparity.
ii /_/ The Taxable Wage Base, which is the
contribution and benefit base under
section 230 of the Social Security Act
at the beginning of the year.
iii /_/ ___ % (not greater than 100%) of the
Taxable Wage Base as defined in
B(4)(f)(ii) above.
iv /_/ $ _____, provided that the amount does
not exceed the Taxable Wage Base as
defined in B(4)(f)(ii) above.
g. PLAN YEAR shall mean (select and complete only one
of the following):
i /_/ the 12-consecutive month period which
coincides with the Limitation Year.
The first Plan Year shall be the period
commencing on the Effective Date and
ending on the last day of the
Limitation Year.
ii /_/ the 12-consecutive month period
commencing on _____, 19__, and each
annual anniversary thereof.
iii /X/ the calendar year (January 1 through
December 31).
h. QUALIFIED DISTRIBUTION DATE, for purposes of making
distributions under the provisions of a Qualified
Domestic Relations Order (as defined in Internal
Revenue Code Section 414(p)), /X/ SHALL /_/ SHALL
NOT be the date the order is determined to be
Page 5
qualified. If SHALL is selected, the Alternate
Payee will be entitled to an immediate distribution
of benefits as directed by the Qualified Domestic
Relations Order. If SHALL NOT is selected, the
Alternate Payee may only take a distribution on the
earliest date that the Participant is entitled to a
distribution.
i. SPOUSE:
/_/ If selected, Spouse shall mean only that
person who has actually been the
Participant's spouse for at least one year.
j. Year of Service shall mean:
i For ELIGIBILITY purposes (select one of the
following):
(a) /X/ the 12 consecutive months during
which an Employee is credited with
1000 (not more than 1000) Hours of
Service.
(b) /_/ a Period of Service (using the
elapsed time method of counting
Service, as described in Section
1.1(N)(3) of the Plan).
ii For ALLOCATION accrual purposes (select one
of the following):
(a) /X/ the 12 consecutive months during
which an Employee is credited with
1000 (not more than 1000) Hours of
Service.
(b) /_/ a Period of Service (using the
elapsed time method of counting
Service, as described in Section
1.1(N)(3) of the Plan).
iii For vesting service purposes (select one of
the following):
(a) /X/ the 12 consecutive months during
which an Employee is credited with
1000 (not more than 1000) Hours of
Service.
(b) /_/ a Period of Service (using the
elapsed time method of counting
Service, as described in Section
1.1(N)(3) of the Plan).
Page 6
iv For purpose of computing Years of Service in
plans where Year of Service is defined in
terms of Hours of Service), the consecutive
12 month period shall be:
(a) For ELIGIBILITY purposes, the first
Year of Service shall be computed using
the 12 month period commencing on the
Employee's date of hire and ending on
the first annual anniversary of the
Employee's date of hire (the "Initial
Computation Period"). In the event an
employee does not complete an
eligibility Year of Service during this
initial computation period, the
computation period shall be (select
only one):
(1) /_/ the period commencing on each
annual anniversary of the
Employee's date of hire and
ending on the next annual
anniversary of the Employee's
date of hire.
(2) /X/ the Plan Year, commencing with
the Plan Year in which the
Initial Computation Period
ends.
(b) For VESTING purposes, Years of Service
shall be computed on the basis of:
(1) /_/ the period commencing on each
annual anniversary of the
Employee's date of hire and
ending on the next annual
anniversary of the Employee's
date of hire.
(2) /X/ the Plan Year, commencing with
the first Plan Year an
Employee completes an Hour of
Service.
(c) For ALLOCATION accrual purposes, Year
of Service shall be computed on the
basis of the Plan Year.
v /_/ For ELIGIBILITY purposes, Years of
Service with the following Predecessor
Employers shall count in fulfilling the
eligibility requirements for this Plan:
_________
Page 7
vi /_/ For VESTING purposes, Years of Service
with the following Predecessor
Employers shall count for purposes of
determining the nonforfeitable amount
of a Participant's account:
_________
5. COVERAGE:
This Plan is extended by the Employer to the following
Employees who have met the eligibility requirements
(select as many as appropriate):
i /_/ All Employees
ii /_/ Salaried Employees
iii /_/ Sales Employees
iv /_/ Hourly Employees
v /_/ Leased Employees
vi /X/ All Employees except (select as
applicable):
(a) /X/ those who are members of a
unit of Employees covered by a
collective bargaining
agreement between the Employer
and Employee representatives,
if retirement benefits were
the subject of good faith
bargaining and if two percent
or less of the Employees who
are covered pursuant to that
agreement are professionals as
defined in Section 1 .410(b)-9
of the Regulations. For this
purpose, the term "Employee
representative" does not
include any organization more
than half of whose members are
Employees who are owners,
officers, or executives of the
Employer.
(b) /_/ those who are nonresident
aliens (within the meaning of
Internal Revenue Code Section
7701(b)(1)(B)) and who receive
no earned income (within the
meaning of Internal Revenue
Code Section 911(d)(2)) from
the Employer which constitutes
income from sources within the
United States (within the
Page 8
meaning of Internal Revenue
Code Section 861(a)(3)).
vii /_/ Union Employees (who are members of the
following unions or union affiliates:
_________
viii /_/ Other Employees, described as follows:
_________
6. ELIGIBILITY:
An Employee covered by the Plan may become a Participant
upon completion of the following eligibility requirements:
a. Service<6>:
i /_/ There shall be no minimum service
requirement for an Employee to become a
Participant.
ii /X/ The Employee must complete 1 Year of
Service (not more than 2 years) to be a
Participant for purposes of receiving
allocations of Employer Profit Sharing
Contributions.
b. AGE:
i /X/ There shall be no minimum age
requirement for an Employee to become a
Participant.
ii /_/ The Employee must attain age _____ (not
more than 21) to be a Participant in
the Plan.
c. WAIVER OF AGE AND SERVICE REQUIREMENTS:
i /_/ Notwithstanding the provisions of Items
B(6)(a) and (b), Employees who have not
satisfied the age and service
requirements, but would otherwise be
eligible to participate in the plan,
shall be eligible to participate on the
Effective Date.
____________________
<6>If a fractional year is elected, the elapsed time method of
computing service shall be used for the fractional year. Eligibility
provisions for optional cash or deferred arrangements are contained in
Item C of this Adoption Agreement.
Page 9
ii /_/ For new Plans, notwithstanding the
provisions of Items B(6)(a) and (b),
Employees who have not satisfied the
age and service requirements, but would
otherwise be eligible to participate in
the plan, shall be eligible to
participate on the Effective Date.
d. ENTRY DATES:
Upon completion of the eligibility requirements, an
Employee shall commence participation in the Plan
(select only one):
i /_/ As soon as practicable under the
payroll practices utilized by the
Employer, and consistently applied to
all Employees, or if earlier, the first
day of the Plan Year<7>.
ii /_/ As of the first day of the month
following the completion of the
eligibility requirements.
iii /X/ As of the earliest of the first day of
the Plan Year, fourth, seventh or tenth
month of the Plan Year next following
completion of the eligibility
requirements.
iv /_/ As of the earliest of the first day of
the Plan Year or seventh month of the
Plan Year next following completion of
the eligibility requirements.
v /_/ As of the first day of the Plan Year
next following completion of the
eligibility requirements (may only be
selected if the eligibility year of
service requirement is 6 months or
less).
7. VESTING:
a. The percentage of a Participant's Employer
Contribution Account (attributable to Employer
Profit Sharing Contributions) to be vested in him or
her upon termination of employment prior to
___________________
<7>Notwithstanding the foregoing, an Employee who has met the
eligibility requirements may not enter the Plan later than six months
following the date on which the Employee first completes the
eligibility requirements.
Page 10
attainment of the Plan's Normal Retirement Date
shall be<8>:
Completed Years of Service
1 2 3 4 5 6 7
i /_/ 100%
ii /_/ 100%
iii /_/ 20% 40% 60% 80% 100%
iv /_/ 20% 40% 60% 80% 100%
v /_/ 10% 20% 30% 40% 60% 80% 100%
vi /X/ 20% 40% 60% 80% 100%
vii /_/ 100%
vii /_/ Full and immediate vesting upon entry
into the Plan<9>
Notwithstanding anything to the contrary in
the Plan, the amount inserted in the blanks
above shall not exceed the limits specified
in Code Section 411(a)(2).
b. For purposes of computing a Participant's vested
account balance, Years of Service for vesting
purposes /X/ SHALL /_/ SHALL NOT include Years of
Service before the Employer maintained this Plan or
any predecessor plan, and /X/ SHALL /_/ SHALL NOT
include Years of Service before the Employee
attained age 18.
c. Notwithstanding the provisions of this Item B(7)(c)
of the Adoption Agreement, a Participant shall
become fully vested in his Participant's Employer
Contribution if:<10>
i /_/ the Participant's job is eliminated
without the Participant being offered a
comparable position elsewhere with the
Employer.
ii /_/ for such reason as is described below:
_____
____________________
<8>Notwithstanding the selection made in this Item B(7)(a), a
Participant shall be fully vested in his or her Employer Contribution
Accounts if the Participant dies or becomes Disabled while in the
employ of the Employer.
<9>If more than one Year of Service is an eligibility
requirement, Item viii MUST be selected.
<10>The provisions of this section will be administered by the
Employer on a consistent and nondiscriminatory basis.
Page 11
8. EMPLOYER PROFIT SHARING CONTRIBUTIONS:
a. CONTRIBUTIONS:
i /X/ In its discretion, the Employer may
contribute Employer Profit Sharing
Contributions to the Plan.
ii /_/ The Employer shall contribute Employer
Profit Sharing Contributions to the
Plan in the amount of _____ % of the
Compensation of all Eligible
Participants under the Plan.
iii /_/ If selected, the Employer may make
Employer Profit Sharing Contributions
without regard to current or
accumulated Net Profits of the Employer
for the taxable year ending with, or
within the Plan Year.
iv /_/ If selected, the Employer may designate
all or any part of the Employer Profit
Sharing Contributions as Qualified
Nonelective Contributions, provided,
however, that contributions so
designated will be subject to the same
vesting, distribution, and withdrawal
restrictions as Before Tax
Contributions<11>.
b. ALLOCATIONS:
Employer Profit Sharing Contributions shall be
allocated to the accounts of eligible Participants
according to the following selected allocation
formula:
i /X/ The Employer Profit Sharing
Contributions shall be allocated to
each eligible Participant's account in
the ratio which the Participant's
Compensation bears to the Compensation
of all eligible Participants. Employer
Profit Sharing Plan Contributions,
shall be allocated to the accounts of
____________________
<11>Amounts designated as Qualified Nonelective Contributions
will be allocated pursuant to Section 3.1(A)(14) of the Basic Plan
Document.
Page 12
Participants who have completed a Year
of Service<12> (select one):
(a) /_/ as of the last day of the
month preceding the month in
which the contribution was
made.
(b) /_/ as of the last day of the
Plan quarter preceding
the quarter in which the
contribution was made.
(c) /X/ as of the last day of the
Plan Year.
ii The Employer Profit Sharing Contributions
shall be allocated in accordance with the
following formula:
(a) If the Plan is Top-Heavy, the
contribution shall be first credited to
each eligible Participant's Account in
the ratio which the Participant's
Compensation bears to the total
Compensation of all eligible
Participants, up to 3% of each
Participant's Compensation.
(b) If the Plan is Top-Heavy, any Employer
Profit Sharing Contribution remaining
after the allocation in (a) above shall
be credited to each eligible Par-
ticipant's account in the ratio which
the Participant's Excess
Compensation<13> bears to the total
Excess Compensation of all eligible
Participants, up to 3% of each
eligible Participant's Excess
Compensation.
____________________
<12>In the event contributions are allocated on a basis other
than a full plan year, the Year of Service shall be based on the
elapsed time method of calculation, and a Participant shall be deemed
to have completed an appropriate Period of Service for allocation
purposes if the Participant has completed a pro-rata Period of Service
corresponding to the interval on which contributions are allocated.
<13>Excess Compensation means a Participant's Compensation in
excess of the Permitted Disparity Level specified in the Definitions
section of this Adoption Agreement.
Page 13
(c) Any contributions remaining after the
allocation in (b) above shall be
credited to each eligible Participant's
account in the ratio which the sum of
the Participant's total Compensation
and Excess Compensation bears to the
sum of the total Compensation and
Excess Compensation of all eligible
Participants, up to an amount equal to
the maximum Excess Percentage times the
sum of the Participant's Compensation
and Excess Compensation. If the Plan
is Top-Heavy, the maximum Excess
Percentage is N/A% (insert percentage).
If the Plan is not Top-Heavy, the
maximum Excess Percentage is N/A%
(insert percentage, which shall not
exceed the prior Excess Percentage
limitation specified by more than 3).
NOTE: If the Permitted Disparity Level
defined at Item B(4)(f) is the Taxable
Wage Base (which is the contribution
and benefit base under section 230 of
the Social Security Act at the
beginning of the year), then the
maximum Excess Percentage should be
2.7% if the Plan is Top-Heavy and 5.7%
if the Plan is not Top-Heavy.
If the Permitted Disparity Level
defined at Item B(4)(f) is greater than
80% but less than 100% of the Taxable
Wage Base, then the maximum Excess
Percentage should be 2.4% if the Plan
is Top-Heavy and 5.4% if the Plan is
not Top-Heavy.
If the Permitted Disparity Level
defined at Item B(4)(f) is greater than
the greater of $10,000 or 20% of the
Taxable Wage Base, but not more than
80%, then the maximum Excess Percentage
should be 1.3 % if the Plan is Top-
Heavy and 4.3% if the Plan is not Top-
Heavy .
(d) Any remaining Employer Profit Sharing
Contribution shall be allocated among
eligible Participants' accounts in the
ratio which the Participant's Compensa-
Page 14
Compensation bears to the total Compen-
sation of all Participants.
iii /X/ If selected, and the Employer has
elected to allocate Employer Profit
Sharing Plan Contributions as of the
last day of the Plan Year, a
Participant must be employed by the
Employer on the last day of the Plan
Year in order to receive an
allocation<14>.
iv /X/ A Participant who terminates before the
end of the period for which
contributions are allocated shall share
in the allocation of Employer Profit
Sharing Contributions if termination of
employment was the result of (select
all that apply):
(a) /X/ retirement
(b) /X/ disability
(c) /X/ death
(d) /_/ other, as specified below:
_____
9. ROLLOVER & TRANSFER CONTRIBUTIONS (select one):
a. /X/ Subject to policies, applied in a consistent
and nondiscriminatory manner, adopted by the
Committee, each Employee, who would otherwise
be eligible to participate in the Plan except
that such Employee has not yet met the
eligibility requirements, and each
Participant may make a Rollover Contribution
as described in Internal Revenue Code
Sections 402(a)(5), 403(a)(4) or 408(d)(3) .
b. /_/ Subject to policies, applied in a consistent
and nondiscriminatory manner, adopted by the
Committee, each Participant may make a
Rollover Contribution as described in
Internal Revenue Code Sections 402(a)(5),
403(a)(4) or 408(d)(3).
c. /_/ No Employee shall make Rollover Contributions
to the Plan.
___________________
<14>This option shall only be effective if Item 8(b)(i)(c) has
been selected. Even if this Item is selected, the provisions of
Section 4.8 of the Basic Plan Document may supersede this requirement
if necessary to satisfy Code Sections 401(a)(26) and 410(b).
Page 15
10. DISTRIBUTIONS:
a. DISTRIBUTIONS UPON SEPARATION FROM SERVICE:
The Normal Form of Benefit under the Plan shall be a
single lump sum distribution, made /X/ (if selected)
as soon as administratively practical after receipt
of a distribution request from a Participant
entitled to a distribution or /_/ (if selected) upon
the Participant's attainment of the Plan's Early
Retirement Date or the Plan's Normal Retirement
Date, whichever is earlier.
In addition to the Normal Form of Benefit, the
Participant shall be entitled to select from among
the following optional forms of benefit specified by
the employer (select as many as apply):
i /X/ Installment payments
ii /_/ Such other forms as may be specified
below:
b. IN-SERVICE DISTRIBUTIONS (select as may be
appropriate):
i /_/ There shall be no in-service
distribution of Participant account
balances derived from Employer Profit
Sharing Contributions .
ii /X/ Participants may request an in-service
distribution of their account balance
attributable to Employer Profit Sharing
Contributions, for the following
reasons:
(a) /_/ For purposes of satisfying a
financial hardship, as
determined in accordance with
the uniform nondiscriminatory
policy of the Committee;
(b) /_/ Attainment of age 59-1/2 by
the Participant; or
(c) /X/ Attainment of the Plan's
Normal Retirement Date by the
Participant.
Page 16
11. FORFEITURES:
a. Forfeitures of amounts attributable to Employer
Profit Sharing Contributions shall be reallocated as
of:
i /_/ the last day of the Plan Year in which
the Forfeiture occurred.
ii /_/ the last day of the Plan Year following
the Plan Year in which the Forfeiture
occurred.
iii /X/ the last day of the Plan Year in which
the Participant suffering the
Forfeiture has incurred five
consecutive One Year Breaks in Service.
b. Forfeitures of Employer Profit Sharing Contributions
shall be reallocated as follows:
i /_/ Not applicable as Employer Profit
Sharing Contributions are always 100%
vested and nonforfeitable.
ii /_/ Used first to pay the expenses of
administering the Plan, and then
allocated pursuant to one of the
following two options<15>:
iii /X/ Forfeitures shall be allocated to
Participant's accounts in the same
manner as Employer Profit Sharing
Contributions, Employer Matching
Contributions, Qualified Nonelective
Contributions or Qualified Matching
Contributions, in the discretion of the
Employer, for the year in which the
Forfeiture arose.
iv /_/ Forfeitures shall be applied to reduce
the Employer Profit Sharing
Contributions, Employer Matching
Contributions, Qualified Nonelective
Contributions or Qualified Matching
Contributions, in the discretion of the
Employer, for the Plan Year following
the Plan Year in which the Forfeiture
arose .
____________________
<15>If this option is selected, iii or iv MUST be selected to
reallocate Forfeitures of Employer Profit Sharing Contributions
REMAINING after expenses of administering the Plan have been paid.
Page 17
12. LIMITATIONS ON ALLOCATIONS:
If the Employer maintains or ever maintained another
qualified retirement plan in which any Participant in this
Plan is (or was) a participant, or could possibly become a
participant, the Employer must complete the following:
a. If the Participant is covered under another
qualified defined contribution plan maintained by
the Employer other than a Master or Prototype Plan:
i /_/ The provisions of this Plan shall apply
as if the other plan were a Master or
Prototype plan; or,
ii /_/ The following provisions will be
effective to limit the total Annual
Additions to the Maximum Permissible
Amount, and will properly reduce any
Excess Amounts, in a manner that
precludes Employer discretion:
b. If the Participant is or ever has been a participant
in a qualified defined benefit plan maintained by
the Employer, the following provisions will be
effective to satisfy the 1.0 limitation of Internal
Revenue Code Section 415(e), in a manner that
precludes Employer discretion:
ADJUSTMENTS WILL BE MADE TO THE IWC RESOURCES
CORPORATION EMPLOYEES' PENSION PLAN AND THEN, TO THE
EXTENT NECESSARY TO THIS PLAN AND THE IWC RESOURCES
CORPORATION EMPLOYEES' STOCK OWNERSHIP PLAN,
RESPECTIVELY.
13. Internal Revenue Code Section 411(d)(6) Protected
Benefits:
/_/ If selected, the Plan has Internal Revenue Code
Section 411(d)(6) Protected Benefits from a prior
plan that this Plan amends, that must be protected.
14. TOP-HEAVY PLAN PROVISIONS:
For each Plan Year in which the Plan is a Top-Heavy Plan
the following provisions will apply:
a. The percentage of a Participant's Employer
Contribution Account to be vested in him upon
termination of employment prior to retirement shall
be:
i /_/ a percentage determined in accordance
with the following schedule :
Page 18
YEARS OF SERVICE PERCENTAGE
---------------- ----------
Less than two 0
Two but less than three 20
Three but less than four 40
Four but less than five 60
Five but less than six 80
Six or more 100;
ii /_/ 100% vesting after ___ (not to exceed
3) Years of Service; provided, however,
that Years of Service may not exceed
two (2) if the service requirement for
eligibility exceeds 1 year; or
iii /X/ computed in accordance with the vesting
schedule selected by the Employer in
Items B(7)(a) or C(4)(d), as long as
the benefits under the vesting schedule
in Items B(7)(a) or C(4)(d) vest at
least as rapidly as the two options
specified in this Item B(14)(a), above.
If the vesting schedule under the Plan shifts in or
out of the schedules above for any Plan Year because
of the Plan's Top-Heavy status, such shift is an
amendment to the vesting schedule and the election
in Section 2.2 of the Basic Plan Document applies.
b. For purposes of minimum Top-Heavy allocations,
contributions and forfeitures equal to 3% (not less
than 3%) of each Non-key Employee's Compensation
will be allocated to each Participant's Contribution
Account when the Plan is a Top-Heavy Plan, except as
otherwise provided in the Basic Plan Document. This
Item 14 will not apply to any Participant to the
extent the Participant is covered under any other
plan or plans of the Employer and the Employer
completes the following: (Insert the name of the
plan or plans which will meet the minimum allocation
or benefit requirement applicable to Top-Heavy
plans.)
_________
c. The Valuation Date as of which account balances or
accrued benefits are valued for purposes of
computing the Top-Heavy Ratio shall be the last day
of each Plan Year.
d. If the Employer maintains or has ever maintained one
or more defined benefit plans which have covered or
Page 19
could cover a Participant in this Plan, complete the
following:
Present Value: For purposes of establishing Present
Value to compute the Top-Heavy Ratio, any benefit
shall be discounted only for mortality and interest
based on the following :
Interest rate 8 % Mortality table 1983 Group
Annuity For Male and Female
15. INVESTMENTS:
a. Investments made pursuant to the investment
direction provisions of the Basic Plan Document
shall be made into any appropriate Investment Fund
as selected by the Employer. In addition,
investment of Plan assets is expressly authorized,
as required by Revenue Ruling 81-100, in each of the
following common or collective funds sponsored by
the Trustee, or an affiliate of the Trustee<16>:
SOCIETY NATIONAL BANK EB MANAGED
GUARANTEED INCOME CONTRACT FUND, THE
SOCIETY NATIONAL BANK MULTIPLE
INVESTMENT TRUST FOR EMPLOYEE BENEFIT
TRUSTS, AND OTHER COLLECTIVE TRUSTS
EXEMPT FROM TAX UNDER IRC SECTION 501
AND AS DESCRIBED IN REV. RUL. 81-100.
b. /X/ If selected, an Employer Stock Fund shall be
available as an Investment Fund pursuant to
the terms of the Basic Plan Document.
/X/ If selected, and an Employer Stock Fund is
available as an Investment Fund, Participants
will have the right, notwithstanding any
other provisions of the Plan, to direct that
a portion of the Plan assets held for their
benefit and invested in the Employer Stock
Fund be diversified pursuant to the
provisions of Section 10.7(F) of the Basic
Plan Document.
____________________
<16>This Item is for use in identifying collective trust funds,
which, pursuant to Revenue Ruling 81-100 must be specifically
referenced in the Plan. Actual Investment Funds are referenced on the
Investment Fund Designation form attached to this Adoption Agreement.
Page 20
c. Participants may make changes of existing account
balances and future contributions from among the
Investment Funds offered:
i /X/ Once during each business day that the
Trustee and the New York Stock Exchange
are open.
ii /_/ Once during each calendar month.
iii /_/ Once during each quarter of the Plan
Year.
iv /_/ Once during each rolling ___ day
period.
d. /_/ If selected, the Participant shall be
restricted in making changes of existing
account balances from any Investment Fund, as
specified in the terms or conditions of such
Investment Fund, and the Employer shall
attach an addendum specifying such
restriction.
e. The Participant will designate into which Investment
Funds all contributions to their accounts are made,
EXCEPT the following:
i /_/ Employer Profit Sharing Contributions
ii /_/ Employer Mandatory Matching
Contributions
iii /_/ Employer Discretionary Matching
Contributions
iv /_/ Qualified Matching Contributions
v /_/ Qualified Nonelective Contributions
f. /_/ If selected, and to the extent a selection is
made above, the Employer shall attach an
Investment Direction Addendum specifying how
the contributions so specified shall be
invested among the Investment Fund.
g. /_/ If selected, the Participant shall be
restricted in the use of the Employer Stock
Fund as an Investment Fund for designating
the investment of contributions in the
Participant's account, as follows:
i /_/ The Participant may not direct the
investment of Plan assets held in their
account into the Employer Stock Fund .
__________
ii /_/ The Participant may direct ____% of the
following contributions into the
Employer Stock Fund:
Page 21
(a) /_/ Employer Profit Sharing
Contributions
(b) /_/ Employer Mandatory Matching
Contributions
(c) /_/ Employer Discretionary
Matching Contributions
(d) /_/ Qualified Matching
Contributions
(e) /_/ Qualified Nonelective
Contributions
iii /_/ ___ % of the following contributions
will be invested into the Employer
Stock Fund, with the balance invested
among:
(a) /_/ the other Investment Funds,
including the Employer Stock
Fund
(b) /_/ the other Investment Funds,
NOT including the Employer
Stock Fund
16. LOANS (select one):
a. /_/ Loans may be made from the Plan in accordance
with the Basic Plan Document and such
policies and procedures as the Committee may
adopt and apply on a consistent and
nondiscriminatory basis<17>.
b. /X/ No loans shall be made from the Plan.
17. TRUSTEE:
The Trustee of this Plan shall be KEY TRUST COMPANY OF
INDIANA, N.A. (a bank or trust company affiliated with
KeyCorp within the meaning of Internal Revenue Code
Section 1504).
18. EFFECTIVE DATE ADDENDUM:
/_/ If selected, the following provisions shall have the
specified effective dates (which are different from
the date specified in Item B(1)):
____
_________________
<17>If this option is selected, the Employer must establish
appropriate procedures for implementation of the Plan's loan program.
Page 22
C. SECTION 401(K) PLAN PROVISIONS:
1. SERVICE:
An Eligible Employee shall be required to fulfill the
following eligibility service requirements in order to
participate in the Plan through a salary reduction
agreement and for purposes of receiving an allocation of
Employer Matching Contributions :
a. /X/ The Employee must complete 1 Year of Service
(not more than 1 year) to be a Participant
for purposes of receiving allocations of
Employer Matching Contributions.
b. /X/ The Employee must complete 1 Year of Service
(not more than 1 year) to be a Participant
for purposes of entering into a Salary
Reduction Agreement and having Employee
Before Tax Contributions or Employee After
Tax Contributions contributed to the Plan on
the Employee's behalf.
2. EMPLOYEE SALARY DEFERRALS:
a. /X/ Participants shall be entitled to enter into
a Salary Reduction Agreement providing for
Before Tax Contributions to be made to the
Plan.
i The minimum Before Tax Contribution
shall be 1 % of the Participant's
Compensation.
ii The maximum Before Tax Contribution
shall be K % of the Participant's
Compensation.
b. /_/ Participants shall be entitled to enter into
a Salary Reduction Agreement providing for
After Tax Contributions to be made to the
Plan.
i The minimum After Tax Contribution
shall be ___ % of the Participant's
Compensation.
ii The maximum After Tax Contribution
shall be ___ % of the Participant's
Compensation.
iii /_/ If selected, notwithstanding the
above, a Participant shall not be
able to enter into a Salary
Reduction Agreement providing for
After Tax Contributions to be made
Page 23
to the Plan unless the Participant
has entered into a Salary Reduction
Agreement that provides for Before
Tax Contributions to be made to the
Plan in an amount of at least ____%
of the Participant's Compensation.
c. /_/ If selected, a Participant shall be entitled
to enter into a Salary Reduction Agreement
providing that any extraordinary item of
compensation, not yet payable (including
bonuses), be withheld from the Participant's
Compensation and contributed to the Plan as
either a Before Tax Contribution, or After
Tax Contribution (provided such contributions
are authorized above, and to the extent that
such contribution, when aggregated with
either the Participants other Before Tax
Contributions or After Tax Contributions do
not exceed the limitations specified above,
on an annual basis) .
3. CONTRIBUTION CHANGES:
a. Participants may increase or decrease the amount of
contributions made to the Plan pursuant to a Salary
Reduction Agreement once each:
i /_/ Plan Year
ii /_/ Semi-annual period, based on the Plan
Year
iii /_/ Quarter, based on the Plan Year
iv /_/ Month
v /X/ Other, as specified below (provided
that it is at least once per year):
WEEKLY
b. Claims for returns of Excess Before Tax
Contributions for the Participant's preceding
taxable year must be made in writing, and submitted
to the Committee by March 15 (specify a date between
March 1 and April 15).<18>
___________________
<18>The date specified is for the refund of amount deferred in
excess of the Code Section 402(g) limit (the $7,000 limit) for the
Participant's taxable year.
Page 24
4. EMPLOYER MATCHING CONTRIBUTIONS<19>:
a. MANDATORY MATCHING CONTRIBUTIONS:
The Employer shall make contributions to the Plan,
in an amount as specified below:
i /_/ An amount, equal to _____ % of each
Participant's Before Tax Contributions,
however, no match shall be made on
Participant's Before Tax Contributions
in excess of 6% (or $_________) of the
Participant's Compensation.
ii /_/ An amount, equal to _____ % of each
Participant's After Tax Contributions,
but not to exceed % of the Par-
ticipant's Compensation, or $ _____ .
iii /_/ An amount, equal to _____ % of each
Participant's contributions made
pursuant to a Salary Reduction
Agreement (including both Before Tax
Contributions and After Tax
Contributions), but only if the
Participant has entered into a Salary
Reduction Agreement providing for
Before Tax Contributions of at least
_____ % of the Participant's Compen-
sation, but not to exceed % of the
Participant's Compensation, or $_____.
iv /_/ An amount equal to the sum of the
following:
(a) ____ % of the first ____% of the
Participant's Compensation
deferred pursuant to a Salary
Reduction Agreement; plus,
(b) ____ % of the next ____% of the
Participant's Compensation
deferred pursuant to a Salary
Reduction Agreement; plus,
(c) ____ % of the next _____% of the
Participant's Compensation
deferred pursuant to a Salary
Reduction Agreement, but not
to exceed ____% of the
____________________
<19>The Employer shall have the right to designate all, or any
portion of Employer Matching Contributions as Qualified Matching
Contributions, which shall then be subject to the same vesting,
distribution, and withdrawal restrictions as Before Tax Contributions.
Page 25
Participant's Compensation, or
$____.
v /_/ An amount equal to $ _____ for each
Participant who enters into a Salary
Reduction Agreement providing for /_/
Before Tax Contributions, /_/ After Tax
Contributions, or /_/ either Before Tax
Contributions or After Tax Contribu-
tions (or a combination of both) equal
to or exceeding ____% of the Parti-
cipant's Compensation. Such contribu-
tions shall be made and allocated :
(a) /_/ only during the first Plan
Year the Plan is in effect, or
if a restatement, for the
first Plan Year beginning
with, or containing the
restatement Effective Date.
(b) /_/ each Plan Year that a
Participant has in force
a Salary Reduction
Agreement meeting the
criteria specified above.
(c) /_/ during the first Plan Year
that the Participant
participates through a Salary
Reduction Agreement meeting
the criteria specified above.
b. DISCRETIONARY MATCHING CONTRIBUTIONS:
/X/ The Employer shall make contributions to the
Plan, in an amount determined by resolution
of the Board of Directors on an annual basis.
The Board resolution shall provide for the
percentage and/or amount of Before Tax Con-
tributions and/or After Tax Contributions to
be matched and the maximum percentage and/or
amount of Before Tax Contributions and/or
After Tax Contributions eligible for
matching.
c. ALLOCATION OF MATCHING CONTRIBUTIONS:
Employer Matching Contributions shall be allocated
pursuant to the terms of the Basic Plan Document,
notwithstanding the foregoing:
i /X/ A Participant who terminates before the
end of the period for which contribu-
Page 26
tions are allocated shall share in the
allocation of Employer Matching Contri-
butions if termination of employment
was the result of (select all that
apply):
(a) /X/ retirement
(b) /X/ disability
(c) /X/ death
(d) /_/ other, as specified below:
_____
ii /X/ Employer Matching Contributions shall
be allocated to the accounts of
Participants (select one) :
(a) /X/ as of each pay period for
which a contribution was made
pursuant to a Salary Reduction
Agreement.
(b) /_/ semi-monthly.
(c) /_/ as of the last day of the
month preceding the month in
which the contribution was
made .
(d) /_/ as of the last day of the Plan
quarter preceding the quarter
in which the contribution was
made.
(e) /_/ as of the last day of the Plan
year.
iii /_/ If selected, the Employer may make
Employer Matching Contributions without
regard to current or accumulated Net
Profits of the Employer for the taxable
year ending with, or within the Plan
Year<20>.
d. The percentage of a Participant's Employer Matching
Contribution Account<21> (attributable to
Employer Matching Contributions) to be vested in him
__________________
<20>Net Profits will never be required for the contribution of
Before Tax Contributions, After Tax Contributions, Qualified
Nonelective Contributions or Qualified Matching Contributions.
<21>Notwithstanding anything in the Adoption Agreement to the
contrary, amounts in a Participant's account attributable to Before
Tax Contributions, Qualified Nonelective Contributions, and Qualified
Matching Contributions shall be 100% vested and nonforfeitable at all
time.
Page 27
or her upon termination of employment prior to
attainment of the Plan's Normal Retirement Date
shall be<22>:
COMPLETED YEARS OF SERVICE
1 2 3 4 5 6 7
i /_/ 100%
ii /_/ 100%
iii /_/ 20% 40% 60% 80% 100%
iv /_/ 20% 40% 60% 80% 100%
v /_/ 10% 20% 30% 40% 60% 80% 100%
vi /X/ 20% 40% 60% 80% 100%
vii /_/ 100%
vii /_/ Full and immediate vesting upon entry
into the Plan
Notwithstanding anything to the contrary in the
Plan, the amount inserted in the blanks above
shall not exceed the limits specified in Code
Section 411(a)(2).
e. Notwithstanding the provisions of this Item C(4)(e)
of the Adoption Agreement, a Participant shall
become fully vested in his Participant's Employer
Matching Contribution Account if<23>:
i /_/ the Participant's job is eliminated
without the Participant being offered a
comparable position elsewhere with the
Employer.
ii /_/ for such reason as is described below:
____
f. CORRECTIVE CONTRIBUTIONS:
i /X/ If selected, the Employer shall be
authorized to make Qualified Matching
Contributions, subject to the terms of
the Basic Plan Document, in an amount
____________________
<22>Notwithstanding the selection made in this Item B(7)(b), a
Participant shall be fully vested in his or her Employer Contribution
Accounts if the Participant dies or becomes Disabled while in the
employ of the Employer.
<23>The provisions of this section will be administered by the
Employer on a consistent and nondiscriminatory basis.
Page 28
determined by resolution of the Board
of Directors on an annual basis.
ii /X/ If selected, the Employer shall be
authorized to make Qualified Nonelec-
tive Contributions, subject to the
terms of the Basic Plan Document, in an
amount determined by resolution of the
Board of Directors on an annual basis .
5. GAP EARNINGS:
/_/ If selected, Gap Earnings, as defined in Section
3.2(G)(1) of the Basic Plan Document, will be
calculated for Excess Elective Deferrals, Excess
Contributions and Excess Aggregate Contributions,
and refunded to the Participant as provided for in
Article III of the Basic Plan Document.
6. FORFEITURES:
a. Forfeitures of amounts attributable to Employer
Matching Contributions shall be reallocated as of:
i /X/ the last day of the Plan Year in which
the Forfeiture occurred.
ii /_/ the last day of the Plan Year following
the Plan Year in which the Forfeiture
occurred.
iii /_/ the last day of the Plan Year in which
the Participant suffering the
Forfeiture has incurred the fifth
consecutive One Year Break in Service.
b. Forfeitures of Employer Matching Contributions shall
be reallocated as follows:
i /_/ Not applicable as Employer Matching
Contributions are always 100% vested
and nonforfeitable.
ii /_/ Used first to pay the expenses of
administering the Plan, and then
allocated pursuant to one of the
following two options:
iii /X/ Forfeitures shall be allocated to
Participant's accounts in the same
manner as Employer Profit Sharing
Contributions, Employer Matching
Contributions, Qualified Nonelective
Contributions or Qualified Matching
Contributions, in the discretion of the
Page 29
Employer, for the year in which the
Forfeiture arose.
iv /_/ Forfeitures shall be applied to reduce
the Employer Profit Sharing
Contributions, Employer Matching
Contributions, Qualified Nonelective
Contributions or Qualified Matching
Contributions, in the discretion of the
Employer, for the Plan Year following
the Plan Year in which the Forfeiture
arose .
c. Forfeitures of Excess Aggregate Contributions shall
be:
i /_/ Applied to reduce Employer
contributions for the Plan Year in
which the excess arose, but allocated
as below, to the extent the excess
exceeds Employer contributions for the
Plan Year, or the Employer has already
contributed for such Plan Year.
ii /X/ Allocated after all other forfeitures
under the Plan:
(a) /X/ to the Matching Contri-
bution account of each
Non-highly Compensated
Participant who made
Before Tax Contributions
or After Tax Contribu-
tions in the ratio which
each such Participant's
Compensation for the Plan
Year bears to the total
Compensation of all such
Participants for the Plan
Year; or,
(b) /_/ to the Matching Contri-
bution account of each
Non-highly Compensated
Eligible Participant in
the ratio which each
Eligible Participant's
Compensation for the Plan
Year bears to the total
Compensation of all
Eligible Participants for
the Plan Year.
Page 30
7. IN-SERVICE DISTRIBUTIONS (select as may be appropriate):
a. /_/ There shall be no in-service distribution of
Participant account balances derived from
Before Tax Contributions (including Qualified
Nonelective Contributions and Qualified
Matching Contributions treated as Before Tax
Contributions under the terms of the Basic
Plan Document), or Employer Matching
b. /X/ Participants may request an in-service
distribution of their account balance
attributable to Employer Matching Contri-
butions, for the following reasons:
i /_/ For purposes of satisfying a
financial hardship, as determined
in accordance with the uniform
nondiscriminatory policy of the
Committee;
ii /_/ Attainment of age 59-1/2 by the
Participant; or
iii /X/ Attainment of the Plan's Normal
Retirement Date by the Participant.
c. /X/ Participants may request an in-service
distribution of their account balance
attributable to Employee Before Tax Con-
tributions, for the following reasons:
i /_/ For purposes of satisfying a
financial hardship, as determined
by the facts and circumstances of
an Employee's situation, in
accordance with the provisions of
Section 3.9 of the Basic Plan
Document;
ii /X/ For purposes of satisfying a
financial hardship, using the "safe
harbor" provisions of Section 3.9
of the Basic Plan Document.
iii /_/ Attainment of age 59-1/2 by the
Participant; or
iv /X/ Attainment of the Plan's Normal
Retirement Date by the Participant.
NOTICE: The adopting Employer may not rely on an opinion letter
issued by the National Office of the Internal Revenue Service as
evidence that the Plan is qualified under the provisions of Section
401 of the Internal Revenue Code. In order to obtain reliance with
respect to the Plan's qualification, the Employer must apply to the
Key District Office of the Internal Revenue Service for a
determination letter.
Page 31
This Adoption Agreement may only be used in conjunction with Basic
Plan Document #05.
This Plan document may only be used under the express authority of
KeyCorp, its subsidiaries and affiliates, and is not effective as
completed until executed by a duly authorized officer of KeyCorp, one
of its subsidiaries or affiliates, and approved by KeyCorp's counsel.
KeyCorp, as sponsor, may amend or discontinue this prototype plan
document upon proper notification to all adopting Employers pursuant
to Revenue Ruling 89-13.
Failure to properly fill out an Adoption Agreement may result in
disqualification of the Plan, and adverse tax consequences to the
Employer and Plan Participants.
This Plan is sponsored by:
KeyCorp, on behalf of its operating subsidiaries, banking and
trust company affiliates
127 Public Square
Cleveland, Ohio 44114
(800) 982-3811
IN WITNESS WHEREOF, the Employer and the Trustee, by their
respective duly authorized officers, have caused this Adoption
Agreement to be executed on this _____ day of ____________, 19____,
EMPLOYER: IWC Resources Corporation
-------------------------
By: /s/ Les M. Williams
---------------------------------
Title: Les M. Williams
Vice President - Human Resources
TRUSTEE: Key Trust Company of Indiana, N.A.
----------------------------------
By: /s/ April M. Czenkusch
---------------------------------
Title: April M. Czenkusch
Vice President
and
By: /s/ Susan A. Taylor
----------------------------------
Title: Susan A. Taylor
Assistant Vice President
APPROVED ON BEHALF OF TRUSTEE:
Initials:________________ Date:_____________
Page 32
INVESTMENT FUND DESIGNATION
IWC RESOURCES CORPORATION (the "Named Fiduciary"), as an
independent fiduciary with respect to the IWC RESOURCES CORPORATION
EMPLOYEE THRIFT PLAN (the "Plan"), an employee pension benefit plan
covered by the applicable provisions of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA") and its employees who
participate therein (the "Participants"), hereby designates the
following investment funds from among the investment fund options
available for adopting employers of the PRISM{R} PROTOTYPE RETIREMENT
PLAN & TRUST (as defined in Section 10.7 of the Plan), available for
selection by Participants for the investment of Plan assets held for
their benefit:
(a) EB MAGIC FUND
(B) VICTORY INVESTMENT QUALITY BOND FUND
(C) AMERICAN BALANCED FUND
(D) VICTORY STOCK INDEX FUND
(E) FIDELITY CONTRAFUND
(F) TEMPLETON FOREIGN FUND
(g) _____
(h) _____
/X/ In addition, if selected, an Employer Stock Fund will also
be available.
In making the selection of Investment Funds, the Named Fiduciary
hereby confirms and acknowledges that:
* The Named Fiduciary has had made available to it copies of
the prospectuses (to the extent required under applicable
federal securities law and regulation) for each investment
fund available for selection by adopting employers of the
PRISM{R} PROTOTYPE RETIREMENT PLAN & TRUST, and has
received copies of each such prospectus for the Investment
Funds selected;
* The Named Fiduciary acknowledges that the Trustee of the
Plan may receive certain fees for services provide to, or
on behalf of an Investment Fund, or the sponsors or
distributors thereof, pursuant to plans of distribution
adopted by the fund under the provisions of Rule 12b-1 of
the Investment Company Act of 1940, and further
acknowledges that (i) such fee, if paid, is appropriate
for services rendered to the fund, and when aggregated
with other fees for service payable to the Trustee
constitutes reasonable compensation for the Trustee's
services to the Plan; and (ii) the Plan will be able to
redeem its interest in any such Investment Fund on
reasonably short notice without penalty;
* The Named Fiduciary further acknowledges that it has
selected the Investment Funds on its determination, after
due inquiry, that the Investment Funds are appropriate
Page 33
vehicles for the investment of Plan assets pursuant to the
terms of the Plan, considering all relevant facts and
circumstances, including but not limited to (i) the
investment policy and philosophy of the Named Fiduciary
developed pursuant to ERISA Section 404; (ii) the ability
of Participants, using an appropriate mix of Investment
Funds, to diversify the investment of Plan assets held for
their benefit; and, (iii) the ability of Participants to,
utilizing an appropriate mix of Investment Funds, to
structure an investment portfolio within their account in
the Plan with risk and return characteristics within the
normal range of risk and return characteristics for
individuals with similar investment backgrounds,
experience and expectations; and,
* The Named Fiduciary acknowledges that it has not relied on
any representations or recommendations from the Trustee or
any of its employees in selecting the Investment Funds.
The Trustee agrees to follow the Named Fiduciary's direction with
respect to offering the Investment Funds available for selection by
the Participants in the Plan for the investment of Plan assets held
for their benefit:
IN WITNESS WHEREOF, the Employer, by its duly authorized
representative, has executed this document in connection with adoption
of the Plan utilizing the PRISM{R} PROTOTYPE RETIREMENT PLAN & TRUST
documents, as provided by the Trustee.
NAMED FIDUCIARY: IWC RESOURCES CORPORATION
By: /S/ Les M. Williams
--------------------------------
Title: Les M. Williams
Vice President - Human Resources
Seen and accepted by the Trustee, who shall provide the
Investment Funds selected by the Employer pursuant to the terms of
this document, and pursuant to the Plan.
TRUSTEE: KEY TRUST COMPANY OF INDIANA, N.A.
By: /S/ April M. Czenkusch
--------------------------------
Title: April M. Czenkusch
Vice President
Page 34
PARTICIPATION AGREEMENT
For Participation by Related Group Members
The undersigned Employer, by executing this Participation
Agreement, elects to become a Participating Employer in the Plan, as
if the Participating Employer were a signatory to the Adoption
Agreement. The Participating Employer accepts, and agrees to be bound
by, all of the elections granted under the provisions of the Plan as
made by IWC Resources Corp., Plan Sponsor of the Adoption Agreement.
(1) The Effective Date of the undersigned Employer's participation
in the designated Plan is: April 1, 1996
(2) The undersigned Employer's adoption of this Plan constitutes:
(a) /_/ The adoption of a new plan by the Participating
Employer.
(b) /x/ The adoption of an amendment and restatement of a
plan currently maintained by the Employer,
identified as IWC RESOURCES CORPORATION EMPLOYEE
THRIFT PLAN AND having an original effective date of
March 1, 1981.
In Witness Whereof, the Employer and the Trustee, by their
respective duly authorized officers, have caused this Adoption
Agreement to be executed on this 29th day of March, l996.
UDC - Utility Data Corp. Key Trust Company of Indiana, N.A.
------------------------ ----------------------------------
(Name of Participating (Name of Trustee designated in Item S)
Employer)
By: /s/ James D. Krefener By: /s/ April M. Czenkusch
------------------------ -----------------------------
EXEC VP VP
--------------------------- ---------------------------------
(Title) (Title)
IWC Resources Corp.
(Name of Plan Sponsor)
By: /s/ Les M. Williams
-----------------------
VP
---------------------------
NOTE: Each Participating Employer must execute a separate
Participation Agreement. See notes at the end of the Adoption
Agreement for important prototype plan information.
PARTICIPATION AGREEMENT
For Participation by Related Group Members
The undersigned Employer, by executing this Participation
Agreement, elects to become a Participating Employer in the Plan, as
if the Participating Employer were a signatory to the Adoption
Agreement. The Participating Employer accepts, and agrees to be bound
by, all of the elections granted under the provisions of the Plan as
made by IWC Resources Corp., Plan Sponsor of the Adoption Agreement.
(1) The Effective Date of the undersigned Employer's participation
in the designated Plan is: April 1, 1996
(2) The undersigned Employer's adoption of this Plan constitutes:
(a) /_/ The adoption of a new plan by the Participating
Employer.
(b) /X/ The adoption of an amendment and restatement of a
plan currently maintained by the Employer,
identified as IWC RESOURCES CORPORATION EMPLOYEE
THRIFT PLAN and having an original effective date of
March 1, 1981.
In Witness Whereof, the Employer and the Trustee, by their
respective duly authorized officers, have caused this Adoption
Agreement to be executed on this 29TH day of March, 1996.
Indianapolis Water Company Key Trust Company of Indiana, N.A.
-------------------------- ----------------------------------
(Name of Participating (Name of Trustee designated in
Employer) Item S)
By: /s/ Les M. Williams By: /s/ April M. Czenkusch
------------------------ -----------------------------
VP VP
--------------------------- ---------------------------------
(Title) (Title)
IWC Resources Corp.
-------------------
(Name of Plan Sponsor)
By: /s/ Les M. Williams
-----------------------
VP
---------------------------
NOTE: Each Participating Employer must execute a separate
Participation Agreement. See notes at the end of the Adoption
Agreement for important prototype plan information.
PARTICIPATION AGREEMENT
For Participation by Related Group Members
The undersigned Employer, by executing this Participation
Agreement, elects to become a Participating Employer in the Plan, as
if the Participating Employer were a signatory to the Adoption
Agreement. The Participating Employer accepts, and agrees to be bound
by, all of the elections granted under the provisions of the Plan as
made by IWC Resources Corp., Plan Sponsor of the Adoption Agreement.
(1) The Effective Date of the undersigned Employer's participation
in the designated Plan is: April 1, 1996
(2) The undersigned Employer's adoption of this Plan constitutes:
(a) /_/ The adoption of a new plan by the Participating
Employer.
(b) /X/ The adoption of an amendment and restatement of a
plan currently maintained by the Employer,
identified as IWC RESOURCES CORPORATION EMPLOYEE
THRIFT PLAN and having an original effective date of
March 1, 1981.
In Witness Whereof, the Employer and the Trustee, by their
respective duly authorized officers, have caused this Adoption
Agreement to be executed on this
29TH day of March, 1996.
Waterway Holdings, Inc. Key Trust Company of Indiana, N.A.
----------------------- (Name of Trustee designated in Items)
(Name of Participating
Employer)
By: /s/ Kenneth Griffin By: /s/ April M. Czenkusch
------------------------ -----------------------------
President VP
--------------------------- ---------------------------------
(Title) (Title)
IWC Resources Corp.
(Name of Plan Sponsor)
By: /s/ Les M. Williams
-----------------------
VP
---------------------------
NOTE: Each Participating Employer must execute a separate
Participation Agreement. See notes at the end of the Adoption
Agreement for important prototype plan information.