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Exhibit 10(v)
Form 10-K for 1994
File No. 1-11237
AT&T CAPITAL CORPORATION
RETIREMENT AND SAVINGS PLAN
HIGHLIGHTS OF THE RETIREMENT AND SAVINGS PLAN
AT&T Capital Corporation adopted the AT&T Capital
Corporation
Retirement and Savings Plan (RSP) effective January 1, 1994 for
its members
and the members of its subsidiaries. This summary refers to AT&T
Capital
Corporation and its subsidiaries collectively as the "Company."
The RSP is designed to help you build financial resources
for the
future. Here's how the RSP can help you achieve your retirement
goals:
A convenient, regular way to save up to 12% of your pay on a
before-tax or
after-tax basis using payroll deductions,
. A matching contribution from the Company equal to 662/3 cents
for every
$l you save on the first 6% of your pay,
. An overall uniform points contribution from the Company which
is
expected to be 9% of total payroll,
. The uniform points contribution allocated to your account will
be based
on pay and service and will equal 6% to 13% of your pay,
assuming the
overall contribution is 9%,
. A choice of investment options,
. Vesting (ownership) in your contributions of 100% at all times,
. Vesting in matching contributions of 100% after a maximum of
11/2 years
of vesting service,
. Vesting in uniform points contributions at the rate of 20% for
each year
of vesting service uniform points contributions are fully
vested once
you complete 5 years of vesting service,
. A tax advantage for your savings while they grow current income
taxes
are not paid on your before-tax contributions, matching
contributions,
uniform points contributions, or any investment earnings while
they
remain in the RSP,
. Access to your before-tax contributions in the event of an
approved
hardship or at any time after you reach age 591/2,
. Access to your unmatched after-tax contributions at any time,
. Access to your matched after-tax contributions, after they have
been in
the RSP for at least 24 months,
. Access to your contributions and matching contributions through
loans,
and
. A choice of payment options when you leave the Company.
ELIGIBILITY AND PARTICIPATION
Who Is Eligible
You are eligible to participate in the RSP if you are a
regular, full-time or part-time member of the Company. However,
you are not eligible to
participate in the RSP if you are a "leased member" (e.g.,
employed by a
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temporary employment service), a nonresident alien with no U.S.
source
income, or a U.S. citizen residing outside the United States and
covered by
a retirement plan in the foreign country.
You are eligible to participate in the RSP:
with respect to your contributions and matching contributions on
the first
day of the month after you become employed by the Company, and
. with respect to uniform points contributions on the January 1
following
the year you become employed by the Company.
For eligibility purposes, transferees from AT&T are treated
the same
as newly hired members.
For rehired members, if you were eligible to participate in
the RSP
before you left the Company and are rehired before you have a
break in
service, you will be eligible to participate in the RSP once you
complete
an hour of service.
However, if you are rehired after you have a break-in
service, you
must fulfill the eligibility requirements again, just as a new
member
would.
If you are uncertain whether or not you are eligible to
participate,
ask your local Human Resources representative.
How You Enroll
Uniform Points Contributions
Once you are eligible, you automatically begin to receive
allocations
of uniform points contributions. You don't have to do anything to
enroll,
except to select your investment options under the RSP. Your RSP
investment
elections will apply to all monies contributed under the RSP. For
more
information, please see "Your Investment Decisions".
Your Contributions and Matching Contributions
If you want to make before-tax or after-tax contributions
and receive
matching contributions from the Company, you must enroll in the
RSP. When
you are hired, you will receive an enrollment package containing
all the
information you will need to designate a beneficiary and to begin
to make
contributions. Your contributions will begin as soon as
practicable after
you enroll.
If you do not elect to contribute to the RSP when you first
become
eligible, you may enroll later at any time by requesting an
enrollment
package from your local Human Resources office and following the
enrollment
procedures.
Please note that your election to contribute to the RSP will not
be
effective unless you have chosen your investment options.
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CONTRIBUTIONS TO YOUR ACCOUNT
Your Contributions
The RSP allows you to save in two ways before-tax and
after-tax. Your
total contributions can be up to 12% of your pay. When you
enroll, you will
be asked to specify what percentage of your contributions should
be before-tax and what percentage should be after-tax.
Under the RSP, "pay" means your cash compensation from the
Company
before reductions for taxes or before-tax contributions to any of
the
Company's member benefit plans, including your base pay,
commissions,
overtime, shift differentials, wages and awards and payments
under the
Company's Annual Incentive Plan (or any successor plan) to the
extent
includible in your taxable income. However, your "pay" under the
RSP does
not include awards or payments under the Company's long term
incentive
award programs such as the Share Performance Incentive Plan and
the Long
Term Incentive Plan.
Before-Tax Contributions
You may contribute from 1% to 12% of your pay on a
before-tax basis,
up to certain limits (see "Limits On Contributions" on page 6).
Your
before-tax contributions go into your account before federal
income taxes
are withheld from your pay. For many participants, this advantage
extends
to state and local income taxes too. You defer paying income
taxes on
before-tax savings dollars until you receive them from the RSP as
a
payment. And, just as important, these before-tax savings dollars
reduce
your salary for tax purposes. Because you pay less taxes, you
have more
money to save or spend. Please look at the example to see how
this works.
Social security taxes, by law, must be withheld from your
unreduced
pay whether you save on a before-tax or after-tax basis. But
because social
security taxes are based on your unreduced pay, your social
security
benefit will not be affected by your participation in the RSP.
After-Tax Contributions
You also may contribute from 1% to 12% of your pay on an
after-tax
basis. Remember, your total before-tax and after-tax
contributions are
limited to 12% of your pay.
Your after-tax contributions are deducted automatically from
your
paycheck, but after federal income taxes have already been
withheld from
your pay. After-tax contributions are more readily available for
withdrawal
than before-tax contributions.
Matching Contributions
For every before-tax or after-tax dollar you contribute to
the RSP up
to the first 6% of your pay, the Company will contribute 662/3
cents to
your account. The Company does not match your contributions above
6% of
your pay. Also, matching contributions will not be made if you
are under a
withdrawal suspension (see the section entitled "Withdrawals
While You Are
Employed" beginning on page 19) or a loan penalty suspension (as
described
in the loan default section on page 17).
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Matching contributions will be made to your account monthly
as soon as
practicable after each payroll period.
Uniform Points Contributions
Each year, the Company will contribute to the RSP a
percentage of the
total pay (see page 3) of all members participating in the RSP.
The
contribution is expected to be 9%, but will not be less than 5%,
of total
pay.
Allocation of Uniform Points Contributions
Once the total uniform points contribution to the RSP is
determined,
the contribution will be allocated to participants on a "uniform
points"
system. The uniform points system allocates the Company's
contribution to
each participant based upon years of service and pay.
Under the uniform points system, you will be allocated:
1 point for each $200 of pay, and
. 10 points for each full year of service and 5/6 of a point for
each
additional full month of service.
Your allocation of the total uniform points contribution
will equal
the Company's total contribution multiplied by a fraction. The
fraction
will equal your points for the year divided by all participants'
points for
the year.
If the uniform points contribution is 9% of total pay, your
allocation
will be at least 6% and no more than 13% of your pay regardless
of the
number of your points.
Your account will receive 1/12 of the total annual
allocation each
month, provided you are actively employed by the Company on the
last day of
that month. The Company expects that the allocation for January
March of
each year will be made at one time generally by April 30;
separate
allocations will be made for the months of April through December
generally
by the end of the following month. For example, the allocation
for April
will be made by May 31 and the allocation for December will be
made by
January 31 of the next year or as soon as administratively
feasible.
Service
In determining the uniform points contribution for a year, a
participant's service will be determined as of the last day of
February of
that year and the total "pay" of all participants is based on the
12 months
ending on that day. For example, the uniform points contribution
for 1994
will be 9% of the total pay of all participants from March 1,
1993 through
February 28, 1994 and each participant will receive an allocation
based on
his or her service as of February 28, 1994.
All your years and months of service after December 31, 1993
with the
Company is counted in determining your points. For members as of
December 31, 1993, your service also includes:
All service before January 1, 1994 with AT&T Capital Corporation,
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All service before January 1, 1994 with a subsidiary of AT&T
Capital
Corporation after AT&T Capital Corporation acquired at least
50%
ownership of the subsidiary, and
. All service before January 1, 1994 with AT&T or any "affiliate"
of AT&T
while affiliated with AT&T.
Two companies are "affiliated" if, under Internal Revenue
Service
rules, they are under common control generally, they are at least
80%
commonly owned.
Examples
Let's look at some examples:
Example 1:
You have 5 years and 6 months of service as of the last day of
February and
your pay is $30,000 for the 12 months ending on that day. You
will have 205
points:
5 years of service x 10 points = 50
6 months of service x 5/6 point = 5
$30,000 / $200 = 150 x 1 point = 150
Total: 205
Assume the Company's uniform points contribution equals 9% of pay
and the
Company's total pay for the 12 months ending March 31 is
$100,000,000. The
Company's total uniform points contribution for the year would
equal
$9,000,000.
If the points for all participants equal 580,000, your account
would
receive an annual allocation of $3,181.03 calculated as follows:
205 points x $9,000,000 = $3,181.03
580,000 points
Example 2:
You have 19 years of service as of the last day of February and
your pay is
$70,000 for the 12 months ending on that day. You will have 540
points:
19 years of service x 10 points = 190
$70,000 / $200 = 350 x 1 point = 350
Total: 540
Assume the Company's total uniform points contribution for the
year would
equal $9,000,000.
If the points for all participants equal 580,000, your account
would
receive an annual allocation of $8,379.31 calculated as follows:
540 points x $9,000,000 = $8,379.31
580,000 points
Rollover Contributions
You may also invest the taxable portion of an account you
have
accumulated under a prior employers' tax qualified retirement
plan in the
RSP. Rollover contributions are not eligible for matching
contributions.
If you transferred your money from a prior employer's plan
to an
individual retirement account (IRA), you may be able to transfer
the value
of that rollover IRA to the RSP. The Internal Revenue Service has
specific
guidelines on these "rollover" contributions. There are two types
of
rollovers: a 60-day rollover and a direct rollover. Under the
60-day
rollover, the check from the distributing plan or rollover IRA is
payable
to you and you send a check to the RSP.
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Please note that if you use a 60-day rollover, your
distribution from
the prior plan will be subject to 20% income tax withholding on
the taxable
portion of the prior plan's distribution. Under the direct
rollover, the
check from the distributing plan or rollover IRA is sent directly
to the
RSP and no federal taxes are withheld.
You may invest your rollover contributions in the investment
options
available under the RSP. See "Your Investment Decisions" on page
9.
If you have questions about rollover contributions, contact
the
Corporate Benefit Office.
Transfers of Account Balances from AT&T Subsidiary Plans
If you were a participant in the AT&T Long Term Savings Plan
for
Management Members, AT&T Long Term Savings and Security Plan,
AT&T
Retirement Savings and Profit Sharing Plan, AT&T Global
Information
Solutions Company Savings Plan, or Encore International, Inc. Tax
Deferred
Savings Plan and were eligible to participate in the RSP on
January 1,
1994, you are fully vested in all contributions made to those
plans as of
December 31, 1993. Your account balances under those plans have
been
transferred to the RSP. You may invest these balances in the
investment
options available under the RSP. See "Your Investment Decisions"
on page 9.
If you were a participant in the Eaton Financial Corporation
401(k)
Profit Sharing Plan and were eligible to participate in the RSP
on January
1, 1994, you are fully vested in your Eaton Financial Corporation
401(k)
Profit Sharing Plan and all contributions made to that plan as of
December
31, 1992. Your account balances under the Eaton Financial
Corporation
401(k) Profit Sharing Plan will be transferred as soon as
administratively
practical.
Limits on Contributions
The Internal Revenue Code places several restrictions on
tax-qualified
plans that may limit the amount of your benefit under the RSP.
The RSP
must:
Ignore any of your pay that exceeds $150,000 in a year this limit
will be
adjusted from time to time for inflation,
. Limit your before-tax contributions to a certain dollar limit
that is
set each year this dollar limit, which is $9,240 in 1994, is
adjusted
annually for inflation, and
. Limit your contributions, matching contributions, and uniform
points
contributions to the lesser of $30,000 or 25% of your taxable
pay in any
calendar year.
Once your before-tax contributions reach the dollar limit
for a year,
your designation of before-tax dollars for the remainder of the
year will
automatically be treated as an after-tax designation.
So that you may save as much as possible for your
retirement, the
Company has established an additional plan known as an "Excess
Benefit
Plan" which will hold contributions in excess of the $30,000 or
25% of pay
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limit. If the total contributions for the year would exceed the
limit, the
excess contributions the Company makes in your behalf will be
credited
under the Excess Benefit Plan, rather than to the RSP.
The Company intends that, to the extent administratively
practicable,
contributions will be made to the RSP as follows:
First, your before-tax contributions up to the limit will be made
to the
RSP,
. Then, your after-tax contributions up to the limit will be made
to the
RSP,
. Then, matching contributions up to the limit will be made to
the RSP,
and
. Finally, uniform points contributions up to the limit will be
made to
the RSP.
The Excess Benefit Plan is described in more detail in a
separate
section of this summary.
Non-Discrimination Tests
The Internal Revenue Code imposes several tests to assure
that plans
like the RSP are used by a balanced proportion of members at
lower and
higher pay levels. One test compares the average before-tax
contributions
of both groups of members. Another test compares the average
after-tax
contributions and matching contributions of both groups of
members.
If the before-tax contribution levels are not balanced, the
before-tax
savings for some higher-paid members may have to be reduced. If
the after-tax and matching contribution levels are not balanced,
then the RSP will
refund amounts related to the excess after-tax contributions to
the
affected higher paid members and any matching contributions made
with
respect to refunded contributions will be forfeited.
There are other Internal Revenue Code provisions that are
designed to
ensure that plans like the RSP do not discriminate in favor of
highly
compensated members.
If the amount you decide to save in the RSP, or if the
amount
contributed in your behalf, is affected by any of these rules,
you will be
notified.
Changing Your Savings
You may change the percentage of pay you are saving at any
time by
calling the recordkeeper's voice response system (VRS) (see page
27). The
changes will take effect as soon as administratively practical.
Remember: your savings are based on a percentage of eligible
pay. If
your pay changes during the year, the Company will automatically
change the
dollar amount of your contribution in accordance with the
percentage of pay
you have elected.
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If you need to stop saving through the RSP, you may do so at
any time
by calling the VRS (see page 27). Your savings will stop as soon
as
administratively possible, but no later than the end of the next
month. If
you decide to resume savings through the RSP again, you may do so
at any
time.
WHAT THE BEFORE-TAX ADVANTAGE MEANS TO YOU
Savings with before-tax dollars means that you can keep more
of what
you earn. The dollars and cents effect depends upon your
situation:
If you are not saving now, but would like to start, you can begin
saving on
a before-tax basis. The amount you actually save in the RSP
will be more
than the amount that your take home pay is reduced. If, for
instance,
you save $150 monthly before-tax to the RSP, your take home pay
may
decrease by less than $108 because of your tax reduction.
. If you are already saving a portion of your pay on an after-tax
basis,
you can save the same amount through the RSP on a before-tax
basis and
actually increase your spendable income.
(Please see the example below.)
Or you could save more on a before-tax basis and keep your
spendable
income the same as it is today.
The following example illustrates how much you can reduce
the federal
income tax you pay and increase your spendable income by saving
before-tax
rather than after-tax dollars in the RSP. Let's assume you earn
$30,000 a
year and you decide to contribute 6% of your annual salary
($1,800) to the
RSP as before-tax savings. Here is how much you can reduce your
taxes and
increase your take-home pay.
As this example illustrates, if you save $1,800 on a
before-tax basis
rather than on an after-tax basis, you can reduce your taxes by
$504 for
the year. The advantages of before-tax savings provide a valuable
incentive
to save in the RSP and work toward your long-term financial
goals. Keep in
mind, however, that your before-tax savings are not as readily
available
for withdrawal before age 591/2 as are your after-tax savings.
Annual Before- Tax
Savings
Annual After- Tax
Savings
W-2
$30,000
$30,000
Before-Tax Savings
- -1,800
- -0
W-2 Taxable Wages
28,200
30,000
Estimated 1994
Federal Income
Taxes*
- -3,330
- -3,834
Estimated 1994
Social Security
Taxes
- -2,295
- -2,295
Pay After Taxes
22,575
23,871
After-Tax Savings
- -0
- -1,800
Spendable Income
22,575
22,071
Tax Reduction/Extra
Take Home Pay
$504
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individual taking the standard deduction and claiming one
exemption. The
1994 standard deduction for a single individual is $3,700 and
each
exemption in 1994 reduces gross income by $2,350 for purposes of
calculating federal income taxes. Not shown are any additional
tax savings
from the deferral of state and local taxes.
YOUR INVESTMENT DECISIONS
When you become a participant in the RSP, the recordkeeper
will
establish an account for you. The recordkeeper will credit to
your account
your before-tax and after-tax contributions, the matching
contributions and
uniform points contributions made in your behalf, your rollover
contributions, amounts transferred from other plans, and earnings
on all of
these.
You decide how to invest your account among the investment
options
described below. However, the contributions must be directed
among the
investments in increments of 1%. Your contributions, matching
contributions, and uniform points contributions will be allocated
among the
various options you have chosen in accordance with your current
investment
direction. You may change your investment direction as often as
you like by
calling the recordkeeper's voice response system (see page 27).
You also may transfer past investment balances from one
investment
option to another, in increments of 1%, as often as you like.
Each investment option is subject to a degree of risk.
Selecting the
appropriate option is your responsibility and the Company cannot
advise you
on how to invest. You may wish to consult with your own financial
or
investment advisor to assess risks associated with each option
and to
decide which of the investment options is better for you. To the
extent
that you exercise control over the investment of your accounts,
the Company
and other plan fiduciaries will not be liable for losses
resulting from
your investment decisions.
The AT&T Shares Fund
The AT&T Shares Fund is invested entirely in shares of
common stock of
AT&T Corp. ("AT&T"). Your interest in the AT&T Shares Fund will
be in whole
and fractional shares of AT&T common stock.
Voting AT&T Shares
Before each annual or special meeting of shareholders of
AT&T, the
trustee will send you a copy of the Annual Report to Shareowners
if you are
invested in AT&T shares. You also will receive the proxy
soliciting
material for the meeting and a form requesting instructions for
the trustee
on how to vote the AT&T shares represented by amounts credited to
your
account. The trustee will vote such shares based on your
instructions. The
trustee will not vote AT&T shares for which it does not receive
voting
instructions.
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Merrill Lynch Basic Value Fund, Inc.
According to its investment manager, the Merrill Lynch Basic
Value
Fund, Inc.'s objectives are to seek capital appreciation and,
secondarily,
income by investing in securities, primarily equities, that Fund
management
believes are undervalued. The Fund seeks to invest in stocks that
possess
one or more of the following characteristics:
Are selling at a discount from per-share book value (that is, a
company's
assets, minus its liabilities, divided by the number of shares
of common
stock outstanding) or from historic price-to-earnings ratios,
. Have dividends greater than the stock market average,
. Seem capable of recovering from situations that caused the
companies to
become temporarily out of favor.
Merrill Lynch Capital Fund, Inc.
According to its investment manager, the Merrill Lynch
Capital Fund,
Inc. seeks the highest total investment return consistent with
prudent
risk. Total investment return is the aggregate of income and
capital value
changes over time. The Fund has a fully managed investment policy
utilizing
equity, debt and convertible securities. This allows management
for the
Fund to vary investment policy based on its evaluation of changes
in
economic and market trends. Consistent with this policy, the
Fund's
portfolio may, at any given time, be invested substantially in
equity
securities (stocks), corporate bonds or money market securities,
although
it is the expectation of management for the Fund that, over long
periods, a
major portion of the Fund's portfolio will consist of equity
securities of
larger market capitalization companies. Dividends are declared
and
reinvested semiannually.
Merrill Lynch Federal Securities Trust
According to its investment manager, the Merrill Lynch
Federal
Securities Trust seeks high current income. The Fund seeks a
current return
through investments in U.S. government and government agencies
including
the Government National Mortgage Association. The Fund may seek
to enhance
its return through the use of certain portfolio strategies
involving
options, and to hedge its portfolio through the use of options
and futures
transactions.
Merrill Lynch Global Allocation Fund, Inc.
According to its investment manager, the Merrill Lynch
Global
Allocation Fund, Inc. seeks high total investment return
consistent with
prudent risk. The Fund has a fully managed investment policy
utilizing U.S.
and foreign equity, debt, money market securities, the
combination of which
will be varied from time to time, both with respect to types of
securities
and markets in response to changing market and economic trends.
This fully
managed investment approach provides the Fund with the
opportunity to
benefit from anticipated shifts in the relative performance of
different
types of securities and different capital markets. Dividends are
declared
and reinvested semiannually.
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investment return will be subject to fluctuations in foreign
currency
exchange rates.
Merrill Lynch Phoenix Fund, Inc.
According to its investment manager, the Merrill Lynch
Phoenix Fund,
Inc.'s objective is to seek long-term capital appreciation
through
investment in a diversified portfolio of equity and fixed income
securities
that Fund management believes are undervalued given current or
future
prospects. The Fund seeks to invest in securities of issuers that
are in
weak financial condition or are experiencing poor operating
results but
which Fund management believes are undervalued due to Fund
management's
assessment of the current or prospective condition of the market.
The
investment policy of the Fund is based upon the belief that the
prices of
troubled issuers are often depressed to a greater extent than
warranted by
the condition of the issuer and that, while investment in such
securities
involves a high degree of risk, such investments offer the
opportunity for
significant capital gains.
The Stable Fund
The Stable Fund consists of shares in the Merrill Lynch
Retirement
Preservation Trust and a portfolio of guaranteed investment
contracts
transferred from the AT&T Long Term Savings Plan for Management
Members,
the AT&T Long Term Savings and Security Plan, and the AT&T
Retirement
Savings and Profit Sharing Plan. In addition, a portion of the
Stable Fund
is held in the Merrill Lynch Government Fund. The rate of return
for the
Stable Fund will initially represent a blending of the respective
earnings
of the Merrill Lynch Retirement Preservation Trust, the Merrill
Lynch
Government Fund, and the transferred guaranteed investment
contracts that
have not yet matured.
Any new contributions invested in the Stable Fund, and
amounts
transferred from other investment options, will be invested in
the Merrill
Lynch Retirement Preservation Trust. As the transferred
guaranteed
investment contracts mature, proceeds from those contracts will
also be
invested in the Merrill Lynch Retirement Preservation Trust.
According to its investment manager, the Merrill Lynch
Retirement
Preservation Trust seeks to provide preservation of participant's
investments, liquidity, and current income that is typically
higher than
money market funds. The Trust invests primarily in a broadly
diversified
portfolio of Guaranteed Investment Contracts in an obligations of
U.S.
government and U.S. government agencies' securities. The Trust
also invests
in high-quality money market securities. Participants purchase
units which
the Trust seeks to maintain at $1 per unit. Income is declared
and
reinvested daily. (Although the Trust purchases Guaranteed
Investment
Contracts, neither the Trust nor its units is guaranteed.)
Self-Directed Option
Some RSP participants may wish to pursue investment options
beyond the
core group of investment options previously described. These
participants
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may establish a self-directed Retirement Cash Management Account
(RCMA
Account) and invest in a wide array of investments available
through
Merrill Lynch, including:
Other Merrill Lynch mutual funds at their net asset value,
. Other mutual funds subject to their normal sales charges and/or
fees,
. Corporate bonds and bond funds, and
. Most publicly traded securities (other than AT&T or AT&T
Capital
Corporation stock).
No contributions will be invested directly in this option.
However,
you may transfer assets to the self-directed option from other
investment
options under the RSP.
If you want more information about this option, your local
Human
Resources representatives will be able to direct you to a Merrill
Lynch
Financial Consultant designated to work with RSP participants.
The Merrill
Lynch Financial Consultant will be able to discuss the
self-directed option
in greater detail, including limitations on the amount of
contributions or
savings that may be invested in this option. The Financial
Consultant will
also be able to work with you to tailor an investment strategy in
line with
your specific investment objectives.
UNDERSTANDING YOUR ACCOUNT
Account Valuations
Your account reflects your participation in the investment
options
under the RSP. The recordkeeper values your account in dollars on
a daily
basis and you can access your account by using the recordkeeper's
voice
response system. See page 27.
Account Statements
Four times a year you will receive a personal statement of
account
showing the value of your account as of March 31, June 30,
September 30,
and December 31.
You may also receive the following statements:
Distribution or Withdrawal Statement when you elect a payout from
your
account,
. Confirmation Statement when you elect a fund or asset transfer,
a change
in your investment options, or a change in your before-tax or
after-tax
contribution percentages, and
. Adjustment Statement when an adjustment/correction is made to
your
account.
You should review all statements immediately to compare the
information against your own records. If there is any
discrepancy, you must
report it within 30 days of receiving the statement. Your local
Human
Resources representatives will be able to direct you where and
how to
report the discrepancy. No adjustments will be made to your
account for any
discrepancy reported more than 30 days after receipt of the
statement.
13
VESTING
Your Contributions
The value of your before-tax and after-tax contributions is
always
100% vested. This means that you fully own those contributions
and their
earnings.
Matching Contributions
You will own the value of the matching contributions
allocated to your
account and their earnings after you become vested.
Members as of January 1, 1994
If you were employed by the Company before 1994 and are a
member on
January 1, 1994, you are immediately 100% vested in the matching
contributions allocated to your account and their earnings.
New Members
If you were first employed by the Company after December 31,
1993, you
will vest in the matching contributions allocated to your account
and their
earnings within a maximum of 11/2 years of service. If you become
employed
by the Company or an "affiliate" (see page 13) before July 1 of
any year,
you vest 100% on December 31 of that year (provided you remain in
service
until December 31). However, if you become employed by the
Company or an
affiliate on or after July 1 of any year, you vest 100% on
December 31 of
the following year (again, provided you remain in service until
December 31
of the following year).
If you leave the Company or an affiliate before you become
vested as
described in the previous paragraph, you will vest 100% only
after you
return to the Company (or an affiliate) and complete a year and a
half of
"vesting service."
Once you are 100% vested in your matching contributions and
earnings,
you are 100% vested in all future matching contributions and
earnings made
to your account.
Uniform Points Contributions
You will vest in uniform points contributions and their
earnings
gradually over 5 years. If you become employed by the Company or
an
affiliate before July 1 of any year, you vest 20% on December 31
of that
year (provided you remain in service until December 31). However,
if you
become employed on or after July 1 of any year, you vest 20% on
December 31
of the following year (again, provided you remain in service
until December
31).
Thereafter, you vest an additional 20% at the end of each
calendar
year of vesting service you complete. Once you become 100%
vested, you are
fully vested in all uniform points contributions and earnings
that are made
to your account, including future contributions and earnings made
to your
account.
14
Summary of Vesting Schedules:
Hired
Matching
Contribution
Uniform Points
Contribution
(100%)
(20%)
(40%)
(60%)
(80%)
(100%)
3/1/94
12/31/94
12/31/94
12/31/95
12/31/96
12/31/97
12/31/98
9/1/94
12/31/95
12/31/95
12/31/96
12/31/97
12/31/98
12/31/99
Vesting Service
You earn vesting service for all continuous periods of
service at:
The Company (including service at Encore International, Inc.,
Eaton
Financial Corporation, United States Leasing International,
Inc., and
U.S. Instrument Rental before those companies were acquired by
AT&T
Capital Corporation),
. AT&T, or at any company while it was "affiliated" with AT&T,
before
January 1, 1994,
. AT&T Global Information Solutions Company (formerly, NCR
Corporation)
before it was acquired by AT&T, or
. Any company while it is "affiliated" with AT&T Capital
Corporation,
after December 31, 1993.
Two companies are "affiliated" if, under Internal Revenue
Service
rules, they are under common control generally, they are at least
80%
commonly owned.
Your vesting service includes periods beginning on the
day(s) you are
first entitled to payment for services and ending on the day(s) a
break in
service begins.
Break In Service
A break in service is a continuous period of at least 12
months during
which you are not employed by the Company or an "affiliate" of
the Company.
A break will begin on the date you retire, quit, are discharged,
or if
earlier, the 12-month anniversary of the date on which you are
otherwise
first absent from service.
If you weren't vested before your break and you return to
work for the
Company, your previous service will be counted for vesting
purposes in the
RSP after you complete one year of vesting service and only if
the number
of your consecutive one-year breaks in service was less than five
years.
If you are absent from work due to:
Your pregnancy,
. The birth of your child, or
. Caring for your child immediately after birth or adoption,
the 12-consecutive month period beginning on the first
anniversary of the
15
maternity/paternity absence will not constitute a break in
service.
Event Vesting
Your account automatically becomes 100% vested in the value
of the
Company and matching contributions and their earnings, regardless
of how
long you've been employed by the Company, if one of the following
events
occurs:
You terminate employment because of "disability" as determined
under the
AT&T Capital Corporation Long Term Disability Plan,
. You are laid off,
. You reach age 65, or
. You are assigned to an entity (other than a subsidiary
participating in
the RSP or a foreign affiliate) in which the Company has a
direct or
indirect equity interest.
Amounts Transferred From AT&T Subsidiary Plans
For members as of December 31, 1993, you are always fully
vested in
amounts transferred to your account from the AT&T Long Term
Savings Plan
for Management Members, AT&T Long Term Savings and Security Plan,
AT&T
Retirement Savings and Profit Sharing Plan, AT&T Global
Information
Solutions Company Savings Plan, Eaton Financial Corporation
401(k) Profit
Sharing Plan, and the Encore International, Inc. Tax Deferred
Savings Plan.
For members who transfer from another AT&T company after
1993, you
will continue to receive vesting credit under your prior plan for
service
with the Company as long as the Company and your prior employer
are
"affiliated."
LOANS
Eligibility
If you are a member on the active payroll of the Company,
the RSP
allows you to borrow money from your contributions (plus
earnings) and from
matching contributions (plus earnings) that were made to the RSP.
Term and Amount of Loan, Interest Rate
You may only have one outstanding loan at a time one loan
must be
fully satisfied before another loan may be taken.
You may take a loan for a term of up to 56 months. However,
you may
take a loan to purchase your principal residence for a term of up
to 20
years. If you terminate employment for any reason, a loan will be
due and
payable three months following the termination date.
The smallest amount you can borrow is $1,000. The largest
amount you
can borrow is the least of:
16
the vested portion of your account attributable to your
contributions and
matching contributions,
. 50% of the vested portion of your entire account balance, or
. $50,000 less your highest outstanding loan balance from the
previous 12
months.
In general, the outstanding balance of loans from any other
qualified
retirement plans maintained by the Company or an "affiliate" is
included in
determining the highest outstanding loan balance during the
previous 12
months.
Loans are made at an interest rate set by the Plan
Administrator. The
current rate is equivalent to the "prime rate" in effect on the
20th day of
the month (or first business day following) prior to the month in
which the
loan is approved, plus 1%. The prime rate is the interest rate
reported in
the Wall Street Journal (Eastern Edition) in its general guide to
money
rates as the base rate on corporate loans at large United States
money
center commercial banks. The interest rate, once established for
a loan,
remains the same throughout the term of the loan.
Security for the Loan
A portion of your account balance, equal to the amount of
the loan,
will be considered as security for the loan. In no event will the
security
exceed 50% of your total vested account balance or your vested
account
balance attributable to your contributions and matching
contributions at
the time the loan is processed.
The loan amount will be generated by the "liquidation" of an
equal
amount from your account balance. This amount will be transferred
to a loan
subaccount established under the RSP and the proceeds will be
distributed
to you. The transfer of funds equal to the loan amount, from your
vested
account balance to the loan subaccount, will be made in the
following
order:
Profit sharing contributions transferred from the AT&T Retirement
Savings
and Profit Sharing Plan (AT&T RSPSP);
. Your before-tax contributions to the RSP and before-tax
contributions
transferred from the AT&T Long Term Savings Plan for Management
Members
(AT&T LTSPME), AT&T Long Term Savings and Security Plan (AT&T
LTSSP),
AT&T RSPSP, and the AT&T Global Information Solutions Company
Savings
Plan (GIS Plan) and related earnings;
. Matching contributions to the RSP and related earnings;
. Matching contributions and related earnings transferred from
the AT&T
LTSPME, AT&T LTSSP, AT&T RSPSP, and the GIS Plan;
. Your after-tax basic contributions and related earnings to the
RSP and
after-tax contributions transferred from the AT&T LTSPME, AT&T
LTSSP,
AT&T RSPSP, and the GIS Plan and related earnings;
. Amounts rolled over from another qualified plan and earnings on
the
rolled over amounts; and
. Your after-tax supplemental contributions to the RSP and
after-tax
contributions transferred from the AT&T LTSPME, AT&T LTSSP,
AT&T RSPSP,
and the GIS Plan and related earnings.
17
Repayment of Loan
You repay the loan in equal monthly payments over the term
of the loan
through after-tax payroll deductions. Repayments will generally
begin with
the payroll period after the loan is processed. The loan
repayment amount,
which is a monthly amount, will be deducted according to your pay
frequency. For example, one payment per month will be made if you
are paid
monthly, and two payments per month will be made if you are paid
biweekly.
In either case, repayments will be credited to your account
monthly.
Loan repayments have priority over your before-tax and
after-tax basic
and supplementary contributions to the Plan. If there are pay
periods in
which there is no pay, or pay is insufficient to collect the
entire
scheduled repayment amount, the missed payment(s) will be made up
in
subsequent pay periods; however, no more than two regular loan
repayments
will be collected in a given pay period, i.e., the normal loan
repayment
and the make-up loan repayment.
Loan repayments are made according to "level amortization"
over the
term of the loan; each monthly repayment will be applied first as
interest
on the unpaid principal balance of the loan, and the remainder of
the
monthly repayment will be applied to reduce the unpaid principal
balance.
As the unpaid loan balance is reduced by the repayments, the
remaining
portion of your account balance is increased with repayments
being invested
according to your current investment direction (or last chosen
investment
direction, if you are not currently contributing).
Loan repayments will be suspended during a formal leave of
absence but
not beyond 12 months of leave, at which time the loan will become
due and
payable in full. Payment in full will also be required at the
time of
retirement or other termination of employment, upon death, or
upon default.
A loan may be repaid, in full, at any time, without penalty.
Early
partial repayments are not permitted. Arrangements for early
repayment must
be made by telephoning the recordkeeper (see page 27).
Renegotiation of Loan
Loan renegotiation means that any of the loan terms have
changed after
the initial loan proceeds have been distributed. However, no
renegotiation
may extend the term of the loan beyond 56 months of the original
loan date
or, in the event the loan is for the purchase of your principal
residence,
20 years.
A loan may be renegotiated only upon:
a demotion, where your basic salary or rate of pay has been
reduced, or
. sickness disability, where benefits have been reduced to less
than full
pay.
. A loan renegotiation must be processed through the recordkeeper
(see
page 27). Once the circumstances of the renegotiation have been
verified
with the payroll office, a new loan package will be forwarded
to you for
review and signature.
18
Default
A loan will be in default if any of the following
circumstances
occurs:
The amount of repayment in arrears is equal to or in excess of
the
equivalent of three monthly repayments as originally scheduled
on
initiation of the loan.
. The loan is not repaid within the five years required by law,
except for
loans used to purchase your principal residence when the term
of the
loan is longer than five years.
. The loan is not repaid within three months following any
termination of
employment.
. The loan is not repaid after 12 months during a leave of
absence.
. You enter into bankruptcy, insolvency, or receivership.
You will be notified of the reason for the default, the
amount that
must be repaid to remedy the default (which is the entire
outstanding
balance and any accrued, but unpaid, interest), the due date and
the
designated location for the payment.
If the loan is not paid in full, the unpaid balance will be
considered
a deemed distribution for tax purposes. The distribution will be
reported
to the Internal Revenue Service. If you are under age 591/2, the
deemed
distribution may result in a 10% early withdrawal penalty on the
taxable
portion, in addition to normal federal income tax.
If the source of any part of the defaulted loan involves
before-tax
monies, the portion of your account balance representing the
before-tax
monies that is considered as security for the loan will be held
in the loan
sub-account until you attain age 591/2, terminate employment, or
die,
whichever is earlier. Upon the occurrence of any of those events,
the
before-tax portion of the defaulted loan will be distributed.
However,
because this distribution of the defaulted loan has no value,
there will be
no tax penalties resulting from its distribution.
If you are an active member at the time of the default and
the default
is not remedied, your matching contributions will be suspended
for 12
months and you will not be granted another loan for the same
period.
Applying for a Loan
There is a $40 application fee each time you receive a loan.
The fee
is deducted from your account in addition to the proceeds of the
loan.
If you are interested in borrowing from your account under
the RSP,
please call the recordkeeper (see page 27) and speak to a
Participant
Service Representative (PSR). The PSR will direct you how to
apply for the
loan.
During your call to the recordkeeper, you can model various
loan
scenarios by varying the dollar amount of the loan, repayment
amount,
interest rate, and/or total number of payments. The PSR will
provide you
with the current interest rate and the amount available to
borrow. You will
19
then be asked to provide some of the variables required to model
the loan:
the loan amount, the repayment period, the interest rate, and the
repayment
amount. The PSR will provide you with the dollar amount of the
loan,
repayment amount, total number of payments, interest rate, total
finance
charge, and the total of all repayments over the term of the
loan.
Please note that if you are married and were a participant
in the AT&T
Global Information Solutions Company Savings Plan or Eaton
Financial
Corporation 401(k) Profit Sharing Plan whose account balance was
transferred to the RSP, you must apply for a loan on a written
application
provided by the Company. Your spouse must consent in writing to
the use of
your account balance as security for the loan. The consent must
be
witnessed by a plan representative or a notary public, and must
specifically acknowledge the effect of the loan on your account
balance. No
consent shall be required if it is established to the
satisfaction of the
Company that it cannot be obtained because you have no spouse or
your
spouse cannot be located, or under such other circumstances as
may be
prescribed by Internal Revenue Service regulations.
WITHDRAWALS WHILE YOU ARE EMPLOYED
The RSP is designed to help you save for retirement.
However, you may
take certain withdrawals during your working years. Withdrawals
while you
are employed are subject to the following restrictions:
The minimum withdrawal amount is $500,
. No uniform points contributions and related earnings are
available for
an in-service withdrawal, and
. Nonvested matching contributions and related earnings are not
available
for an in-service withdrawal.
The circumstances under which you may withdraw your
after-tax
contributions, before-tax contributions, and vested matching
contributions
are described below. First, however, you need to understand how
the RSP
treats your contributions and amounts transferred from other
plans.
Basic and Supplemental Contributions
Under the RSP, your contributions are recorded in two ways:
On a before-tax and after-tax basis, and
. On a basic and supplemental contribution basis.
The part of your contribution up to the first 6% of your pay
is
considered your basic contribution and is what is matched by the
Company.
Your contribution in excess of 6% of your pay is your
supplemental
contribution.
If you are making both before-tax and after-tax
contributions, your
before-tax contributions count toward your basic contribution
first.
20
For example, assume your annual pay is $92,400 and you want
to
contribute 12% to the RSP ($11,088) and you want to make the
largest
permissible before-tax contribution ($9,240 for 1994, which
equals 10% of
your pay). The RSP will treat your contribution as follows:
The first 6% of your pay ($5,544) will be a before-tax basic
contribution,
. The next 4% of your pay ($3,696) will be a before-tax
supplemental
contribution, and
. The next 2% of your pay ($1,848) will be an after-tax
supplemental
contribution.
Transfers from Other Plans
The RSP keeps track of amounts transferred from another plan
and those
contributions are subject to the same withdrawal restrictions as
if they
had been made directly to the RSP. Your before-tax contributions
to the
other plan will be treated as before-tax contributions (basic or
supplemental depending on how much of the contribution was
matched under
the prior plan) to the RSP. Similarly, your after-tax
contributions to the
other plan will be treated as after-tax contributions (basic or
supplemental) to the RSP.
Withdrawals After You Reach Age 59-1/2 or Upon Becoming Disabled
The funds available for withdrawal after age 591/2, or after
you
become disabled, and the order in which they will be taken out of
the RSP
are as follows:
Your after-tax contributions and related earnings,
. Any amounts rolled over from another qualified plan and related
earnings note amounts transferred from other plans (see page 6)
are not
considered a rollover
. Any vested matching contributions and related earnings, and
. Your before-tax contributions and related earnings.
Withdrawals Before You Reach Age 59-1/2
The funds available for withdrawal before age 591/2 and the
order in
which they will be taken out of the RSP are as follows:
Your after-tax supplemental contributions and related earnings,
. Your after-tax basic contributions that have been in the RSP
(or prior
plan) for at least 24 months and any earnings on after-tax
basic
contributions,
. Any amounts rolled over from another qualified plan note
amounts
transferred from other plans (see page 6) are not considered a
rollover and related earnings,
. Vested matching contributions that have been in the RSP (or
prior plan)
for at least 24 months and earnings on vested matching
contributions,
and
. Your after-tax basic contributions that have been in the RSP
(or prior
plan) for less than 24 months if these amounts are withdrawn
you will be
unable to contribute to the RSP (and receive matching
contributions) for
12 months after the withdrawal.
21
Please note that amounts transferred from other AT&T and
Company plans
may be withdrawn before you reach age 591/2 subject to the
following rules:
1992 vested matching contributions, after-tax basic
contributions, and
related earnings transferred from the AT&T Long Term Savings
Plan for
Management Employees (AT&T LTSPME), AT&T Long Term Savings and
Security
Plan (AT&T LTSSP), and AT&T Retirement Savings and Profit
Sharing Plan
(AT&T RSPSP) may be withdrawn however, if these transferred
amounts are
withdrawn before January 1, 1995, you will be unable to
contribute to
the RSP (and receive matching contributions) for 12 months
after the
withdrawal, and
. 1993 vested matching contributions, after-tax basic
contributions, and
related earnings transferred from the AT&T LTSMPME, AT&T LTSSP,
and AT&T
RSPSP and all your after-tax basic contributions, vested
matching
contributions, and related earnings transferred from the AT&T
Global
Information Solutions Company Savings Plan (GIS Plan) may be
withdrawn however, if these transferred amounts are withdrawn
before
January 1, 1996, you will be unable to contribute to the RSP
(and
receive matching contributions) for 12 months after the
withdrawal.
Hardship Withdrawals (Your Before-Tax Contributions)
Because of the tax advantage of before-tax contributions,
the Internal
Revenue Service has strict regulations regarding withdrawals from
your
account. In general, if you are not yet age 591/2 you may make an
in-service withdrawal from your before-tax contributions only if
you have a
financial hardship that creates an immediate and heavy financial
need that
cannot be relieved by all other readily available financial
resources,
including other available withdrawals and loans from the RSP. You
also may
be able to make a hardship withdrawal of company contributions
and related
earnings transferred from the Eaton Financial Corporation 401(k)
Profit
Sharing Plan.
NOTE: As of September 1994, the Eaton Financial Corporation
401(k)
Profit Sharing Plan account balances have not been transferred,
but will be
transferred to the RSP as soon as administratively practical.
For all hardship withdrawals, the following applies:
The amount requested cannot be greater than the amount necessary
to meet
your financial hardship,
. You may not use the hardship withdrawal funds for any purpose
other than
the purpose for which you submitted the request, and
. You cannot contribute to the RSP (and receive matching
contributions)
for at least 12 months after the withdrawal.
. Reasons for financial hardships under the RSP are:
. To make a down payment and pay closing costs for the purchase
of your
principal residence,
. To make payments to avoid eviction from your principal
residence, or
foreclosure on the mortgage of your principal residence,
. Extensive home repairs or renovations related to fire, natural
disaster,
or other unforeseeable event,
. To pay heavy legal expenses,
. To purchase or repair the vehicle you or your spouse use to
commute to
and from work (your primary transportation vehicle) the
purchase or
22
To pay for tuition and other related education expenses after
high school
for you or your dependents for the next 12 months,
. To pay unreimbursed medical expenses for you or your
dependents, or
. To pay funeral expenses for a dependent.
You will be required to supply proof of the hardship event
such as a
home purchase contract, foreclosure or eviction notice, doctor or
hospital
bills, or tuition bill, and provide documentation as to the
amount
necessary to satisfy the hardship. You must also sign a statement
attesting
that any other sources of funds, e.g., bank accounts, have been
reasonably
exhausted, and that the financial need cannot be relieved except
through
the exercise of a hardship withdrawal. In addition, you must have
taken all
available withdrawals and loans from the RSP in order to receive
a hardship
withdrawal.
The funds available for a hardship distribution are your
before-tax
contributions for all Plan Years and related earnings on
before-tax
contributions made to a prior plan before January 1, 1989.
Applying for an In-Service Withdrawal
If you want to apply for an in-service withdrawal, you must
submit the
appropriate forms which are available from your local Human
Resources
representative.
For a before-tax hardship withdrawal, your application will
be
reviewed by the local Human Resources representative and if
complete,
forwarded to the Corporate Benefit Office for approval. You will
be
informed in writing of the approval or denial by the Corporate
Benefit
Office.
PAYMENTS FROM THE RSP AFTER EMPLOYMENT ENDS
When you leave the Company, you are entitled to a
distribution from
your account (unless you transfer to an "affiliated" company).
You will
need to decide how and when you want to receive payment. If the
total
vested value of your account is equal to or less than $3,500, the
Company
may elect to pay your benefit immediately. If the total vested
value of
your account is more than $3,500:
You may begin payment of your account immediately, or
. You may defer payment of your account until you reach age
701/2.
While your account is deferred, it remains invested in the
funds you
select. In addition, you can transfer fund balances to other
investment
options under the RSP. See "Your Investment Decisions" on page 9.
For a discussion about the RSP benefit payable if you die
before
payments begin, please see page 24.
How to Request a Distribution
To receive benefits from the RSP when you leave, you must
submit the
23
appropriate forms which are available from the Corporate Benefits
Office.
How Your Account Is Paid
Generally, all withdrawals and distributions from the RSP
will be made
in cash. However, you may choose to receive the value of your
account
invested in the AT&T Shares Fund in cash, or in full shares of
AT&T common
stock and cash for partial shares, or a combination of shares and
cash.
If the total vested value of your account is equal to or
less than
$3,500, you will be paid in a single lump sum. If the vested
value of your
account is greater than $3,500, you choose how the vested value
of your
account is paid.
Your Contributions, Matching Contributions, Rollover
Contributions, and
Their Earnings
You may choose to have your contributions, matching
contributions,
rollover contributions, and earnings on these amounts distributed
to you in
either:
A single lump sum,
. A direct rollover, where your before-tax contributions,
matching
contributions, rollover contributions, and related earnings are
paid
directly to your IRA or to another employer plan that accepts
your
rollover, or
. A self-directed annual withdrawal of any amount in your account
provided
you have completed at least 10 years of service when you leave
the
Company.
Uniform Points Contributions and Their Earnings
If you are not married on the date your benefits are to
begin, the
Company will use the vested value of your uniform points
contribution
account to buy a single life annuity for you. The annuity will
provide you
with monthly payments for as long as you live.
If you are married on the date your benefits are to begin,
the Company
will use the vested value of your uniform points contribution
account to
buy a joint and 50% survivor annuity for you. The annuity will
provide you
with monthly payments for as long as you live. If you die and are
survived
by a spouse, your spouse will receive a monthly benefit for the
remainder
of his or her life equal to 50% of the benefit you were receiving
at the
time of your death.
Throughout this booklet any reference to spouse refers only
to a
lawful spouse.
You may, however, elect to waive this form of payment.
Before you
receive your distribution, the Corporate Benefits Office will
provide a
detailed explanation of the life annuity or joint and survivor
annuity
option. You will be given the option of waiving the life annuity
or joint
and survivor annuity form of payment during the 90-day period
before the
annuity is to begin.
24
If you are married, your spouse must consent in writing to the
waiver in
the presence of a notary or a plan representative. You may revoke
any prior
waiver.
The Corporate Benefits Office will provide you with forms to
make this
election. Since your spouse participates in this election, you
must
immediately inform the Corporate Benefits Office of any change in
your
marital status.
If you and your spouse elect not to take a joint and
survivor annuity,
or if you are not married when your benefits are scheduled to
begin and
have elected not to take a life annuity, you may elect an
alternative form
of payment. This payment may be made in one of the following
methods:
A single lump sum,
. A direct rollover, where before-tax contributions, matching
contributions, rollover contributions, and related earnings are
paid
directly to your IRA or to another employer plan that accepts
your
rollover, or
. A self-directed annual withdrawal of any amount in your account
if you
have at least 10 years of service when you leave the Company.
Amounts Transferred from Other Plans
In addition to the other forms of benefit available under
the RSP, the
following special provisions apply to amounts transferred from
certain
plans:
Annuities (account balances transferred from the AT&T Global
Information
Solutions Company Savings Plan or the Eaton Financial
Corporation 401(k)
Profit Sharing Plan) All or part of your transferred account
balance
will be paid as a joint and 50% survivor annuity, unless you
elect to
receive another form of benefit with your spouse's consent.
Other
annuity forms may also be available for your transferred
account
balance.
. Installments (account balances transferred from the AT&T Global
Information Solutions Company Savings Plan or the Encore
International,
Inc. Tax Deferred Savings Plan) You may be able to receive all
or part
of your transferred account balance in a self-directed annual
withdrawal
even if you have less than 10 years of service.
If you are eligible for the annuity or installment forms of
distribution, you will receive the information necessary to make
the
elections when you are ready to receive your distribution.
Forfeitures
If you leave the Company (unless you transfer to an
affiliated
company) before you are fully vested, you will be entitled to
receive
payment of the vested portion of uniform points contributions and
matching
contributions, and related earnings. However, you will forfeit
the
nonvested portion of these contributions and earnings.
If you return to work for the Company before you have five
consecutive
25
one-year breaks in service (see page 14) and you repay the amount
of any
payment you received, the amounts that were forfeited will be
restored to
your account. If you do not repay the value of any payment that
was made to
you, or if you are rehired after you have five consecutive
one-year breaks
in service, the amount forfeited will not be restored.
Forfeited balances will be used first to restore account
balances of
rehired members who have met the conditions for restoring their
forfeited
balances and then to decrease future Company contributions.
DEATH BENEFITS BEFORE YOU BEGIN TO RECEIVE YOUR BENEFIT
Before-Tax Contributions, After-Tax Contributions, Matching
Contributions,
Rollover Contributions, and Amounts Transferred from Certain
Other Plans
When you enroll, you will be asked to name a beneficiary the
person or
persons who will receive the benefits from your account if you
die. Upon
your death, your beneficiary will be entitled to a distribution
of 100% of
your before-tax and after-tax contributions, matching
contributions,
rollover contributions, amounts transferred from the AT&T Long
Term Savings
Plan for Management Members, AT&T Long Term Savings and Security
Plan, AT&T
Retirement Savings and Profit Sharing Plan, or Encore
International, Inc.
Tax Deferred Savings Plan, and their related earnings. Your
beneficiary
will receive a lump sum distribution unless he or she elects any
other form
of benefit to which you would have been entitled if you had
terminated
employment before you died.
You may name anyone as your beneficiary. However, if you are
married
and name someone other than your spouse as your beneficiary, the
law
requires that your spouse consent to the designation showing his
or her
understanding that if you die he or she will receive no benefits.
If you have not designated a beneficiary and you are
married, your
spouse will be considered your beneficiary. If you are not
married, your
account will be paid to your estate if you have not designated a
beneficiary or if your beneficiary dies before you do.
Uniform Points Contributions and Amounts Transferred from Certain
Other
Plans
If you die while you are employed by the Company, you will
become 100%
vested in the uniform points contributions in your account and
their
earnings. If you die after you leave the Company, your vested
percentage in
these amounts will not be changed upon your death.
If you are not married when you first become a participant,
you will
be asked to name a beneficiary. If you have a vested interest in
the
uniform points contributions, amounts transferred from the AT&T
Global
Information Solutions Company Savings Plan or Eaton Financial
Corporation
401(k) Profit Sharing Plan, and their related earnings and die
before you
receive a distribution of these amounts, then your beneficiary
will be
entitled to distribution of 100% of these amounts. Your
beneficiary will
26
receive a lump sum distribution unless he or she elects any other
form of
benefit (other than an annuity form of benefit) to which you
would have
been entitled if you had terminated employment before you died.
If you have
not designated a beneficiary or if your beneficiary dies before
you, then
your account will be paid to your estate.
If you are married, have a vested interest in the uniform
points
contributions, amounts transferred from the AT&T Global
Information
Solutions Company Savings Plan or Eaton Financial Corporation
401(k) Profit
Sharing Plan, and their related earnings allocated to your
account, and you
die before you receive a distribution of these amounts, then your
legal
spouse will be covered by a preretirement survivor annuity. The
amount of
the survivor annuity will be the actuarial equivalent of 100% of
the vested
portion of your account balance attributable to these
contributions and
earnings. Your spouse will be able to elect any other form of
benefit under
the RSP. Once you have reached age 35, you will be able, with
your spouse's
consent, to waive the preretirement survivor annuity and
designate another
form of benefit or beneficiary. Your local Human Resources
Representative
will provide you with forms to make this election. Since your
spouse
participates in this election, you must immediately inform the
local Human
Resources representative of any change in your marital status.
Changes In Beneficiaries
You may change beneficiaries at any time. To do so, you (and
your
spouse, when required) should complete the appropriate
beneficiary
designation form and return it to your local Human Resources
Representative.
TAX CONSIDERATIONS
The following discussion of tax considerations is intended
to provide
guidelines only. Tax laws are complex and subject to change.
Before you
make decisions about receiving money from your RSP account, you
should
consult a qualified tax expert.
Under current law, you do not pay federal income taxes on
your before-tax contributions. For most participants, this
advantage also applies to
state income taxes. You also don't pay any federal or state
income taxes on
matching contributions, uniform points contributions, or any
earnings as
long as they stay in the RSP. You will be required to pay federal
and state
income taxes on these amounts when they are withdrawn or
distributed.
You won't owe any taxes on your after-tax contributions when
they are
withdrawn or distributed since you already paid taxes on those
contributions when they were deposited in your account. However,
you will
owe taxes on earnings on your after-tax contributions when
withdrawn or
distributed.
Shares
If you receive AT&T shares in a distribution, the value of
what you
receive will not include any increase in value over the amount
paid for the
27
shares by the RSP. The increase will be taxable to you as a
capital gain
when you sell the shares.
10% Excise Tax on Early Withdrawals
There may be a 10% excise (penalty) tax on the taxable
portion of an
in-service withdrawal or distribution if you receive the
withdrawal or
distribution before age 591/2. This 10% excise tax is in addition
to the
regular income tax you must pay on the taxable portion of the
withdrawal.
However, the excise tax does not apply if:
You are least age 591/2,
. You terminate employment after reaching age 55,
. You become disabled or die,
. You use the distribution for medical expenses that are
deductible on
your tax return, or
. The distribution is part of a qualified domestic relations
order (see
page 31).
20% Withholding
If you choose to have your RSP benefit paid to you, the Plan
Administrator is required to withhold 20% of the payment and send
it to the
IRS as income tax withholding to be credited against your taxes.
You can
avoid this 20% withholding if you choose a direct rollover that
is, having
your RSP benefits paid directly to your IRA or to another
employer plan
that accepts your rollover.
If you choose to have the RSP benefit paid to you, you can
still
decide, within 60 days after you receive payment, to rollover all
or a part
of it to an IRA or another employer plan that accepts rollovers.
You can
rollover up to 100% of the taxable portion of your distribution,
including
an amount equal to the 20% that was withheld. If you choose to
rollover
100%, you must find other money within the 60-day period to
contribute to
the IRA or the employer plan to replace the 20% that was
withheld. On the
other hand, if you rollover only the 80% that you received, you
will be
taxed on the 20% that was withheld.
NONTRANSFERABILITY OF BENEFITS
You or your beneficiary may not assign or transfer amounts
under the
RSP. Similarly, amounts credited to your account may not be used
to pay
your debts or obligations unless you first elect a withdrawal
from your
account. However, the RSP will comply with a court-issued
"qualified
domestic relations order" or a qualified tax levy.
If you become divorced or separated, certain court orders,
referred to
as a domestic relations order, could require that part of your
benefits be
paid to someone else your former spouse or children, for example.
AT&T
Capital Corporation has established guidelines for processing
domestic
relations orders. As soon as you are aware of any court
proceedings which
may affect your benefits, contact the Corporate Benefit Office.
28
CONTACTING THE RECORDKEEPER
After you've enrolled in the RSP, you may want updates on
your
accounts, or want to make changes to your investment decisions.
You'll be
able to access your account virtually 24 hours a day, seven days
week including holidays.
Here's how the recordkeeper's voice response system (VRS)
works:
To reach the VRS line, dial:
. 1-800-228-401K
. To access the VRS system, you'll use the same Personal
Identification
Number (PIN) you received when you enrolled in the RSP.
. When you dial the VRS number, you'll be asked to enter your
5-digit PIN,
and your social security number.
. If you don't know your PIN, you'll need to speak to a
Participant
Service Representative (PSR); PSRs are available Monday through
Friday,
8:00 a.m. to 7:00 p.m., Eastern Standard Time.
. Once you're in the VRS system, you'll be able to:
Change before-tax and after-tax savings percentages,
Obtain current account balances, including totals by
investment,
Obtain current investment direction,
Change investment direction of future contributions,
Transfer existing assets among funds, and
Receive investment information and performance history.
At any time during your call, you'll be able to press "0" to
speak
with a PSR (providing you call during the hours listed above).
If your request is received before 3:00 PM Eastern Standard
Time, it
will be processed that day; if the request is received after 3:00
p.m.
Eastern Standard Time, it will be processed the next business
day.
If you have any questions on how to use the VRS or how to
contact a
service representative, please call your local Human Resources
representative.
CLAIM AND APPEAL PROCEDURES
Claim Procedures
Please see "Applying For An In-Service Withdrawal" on page
21 and "How
To Request A Distribution" on page 22 for information on filing a
claim for
benefits under the RSP. If a claim for benefits is denied,
either in whole
or in part, you or your dependents will receive written
notification from
the Administrative Committee.
If a claim for benefits is denied, either in whole or in
part, you or
your dependents will receive written notification from the
Corporate
Benefit Office. This written notification will include:
29
The specific reason or reasons for the denial,
. Specific reference to pertinent RSP provisions on which the
denial was
based,
. A description of any additional material or information
necessary to
perfect the claim and an explanation of why the material or
information
is necessary, and
. Appropriate information about the steps to be taken if you,
your
dependent, or a person authorized to represent you or your
dependent
wishes to submit the claim for review.
The Corporate Benefit Office will respond to your claim
within 90 days
after it receives your claim submitted according to the
procedures
described in this section. This 90-day period may be extended up
to an
additional 90 days if the Corporate Benefit Office notifies you
before the
original 90-day period expires.
If a claim for benefits is denied, in whole or in part, or
if you or
your dependents believe that benefits under the RSP to which you
or your
dependents are entitled have not been provided, you, your
dependents or
authorized representative may appeal this denial or other action
by the
Corporate Benefit Office.
Appeal Procedures
Please note that the RSP requires that you pursue all your
claim and
appeal rights described in this section before you seek any other
legal
recourse regarding claims for benefits.
You must appeal in writing within 60 days after you receive
notification of the Corporate Benefit Office's decision or, if
you didn't
receive notification, within 60 days after the 90-day period has
lapsed.
Send your written request for review of any denied claim or other
disputed
matter directly to the Administrative Committee at the address
listed on
page 32. The person sending the request has the right to:
Review pertinent plan documents. You can obtain them by following
the
procedures described under "Plan Documents," page 33, and
. Send to the Administrative Committee a written statement of the
issues
and any other documents in support of the claim for benefits or
other
matter under review.
The Administrative Committee will provide a written response
to the
appeal within 60 days after it is received. The 60-day period may
be
extended up to an additional 60 days if the Administrative
Committee
notifies you before the original 60-day period expires. If the
Administrative Committee does not respond within 60 (or 120)
days, the
claimant may consider the claim denied.
The Administrative Committee serves as the final review
committee
under the RSP and has sole and complete discretionary authority
to
determine conclusively for all parties, and in accordance with
the terms of
the documents or instruments governing the RSP, any and all
questions
arising from administration of the RSP and interpretation of all
plan
provisions, determination of all questions relating to
participation of
30
eligible members and eligibility for benefits, determination of
all
relevant facts, the amount and type of benefits payable to any
participant,
spouse or beneficiary, and construction of all terms of the RSP.
Notwithstanding the foregoing, AT&T Capital Corporation has
sole and
complete discretionary authority to determine questions relating
to
eligibility of participants for membership in the RSP and to
amend or
terminate the RSP at any time. Respective decisions by the
Administrative
Committee and AT&T Capital Corporation shall be conclusive and
binding on
all parties and not subject to further review. In any case, as a
participant or dependent of a participant in the RSP, you may
have further
rights under the Member Retirement Income Security Act of 1974,
as amended
(ERISA) (see page 31).
FAMILY AND MEDICAL LEAVE ACT OF 1993
The Family and Medical Leave Act of 1993 (FMLA) requires
covered
employers to provide up to 12 weeks of unpaid, job-protected
leave to
"eligible" members for certain family and medical reasons.
Members are
eligible if they have worked for the Company for at least 1 year
and for at
least 1,250 hours over the previous 12 months.
Under the FMLA, an eligible member may take an unpaid leave
for any of
the following reasons:
To care for the member's child after birth, or placement for
adoption or
foster care;
. To care for the member's spouse, child, or parent, who has a
serious
health condition, or
. For a serious health condition that makes the member unable to
perform
his or her job.
The member may be required to provide advance leave notice
and medical
certification. Taking of leave may be denied if requirements are
not met.
The member ordinarily must provide 30 days' advance notice when
the leave
is "foreseeable."
. The Company may require medical certification to support a
request for
leave because of a serious health condition, and may require
second or
third opinions (at the Company's expense) and a fitness for
duty report
to return to work.
. During the FMLA leave, the Company must maintain the member's
health
coverage for up to 12 weeks of leave (up to the amount normally
paid by
the Company, under the same terms and conditions as apply to
active
members who are not on a FMLA leave). Members must continue to
pay any
required member contributions in order to continue coverage.
. Upon return from FMLA leave, most members must be restored to
their
original or equivalent positions with equivalent pay, and other
terms
and conditions of employment.
. The use of FMLA leave cannot result in the loss of any
employment
benefit that accrued before the start of any member's leave.
31
FMLA makes it unlawful for any employer to:
. Interfere with, restrain, or deny the exercise of any right
provided
under the FMLA, and
. Discharge or discriminate against any person for opposing any
practice
made unlawful by the FMLA or for involvement in any proceeding
under or
relating to the FMLA.
FMLA does not affect any federal or state law prohibiting
discrimination, or supersede any state or local law or collective
bargaining agreement which provides greater family or medical
leave rights.
RIGHTS OF A PLAN PARTICIPANT OR BENEFICIARY UNDER ERISA
As a participant in the AT&T Capital Corporation Retirement
and
Savings Plan, you have these rights and protections under ERISA:
You can examine, without charge, all plan documents, including
the
contracts with claims administrators and trustee, and the
copies of all
documents filed by the plan with the U.S. Department of Labor,
such as
detailed annual reports. You may examine these documents at the
Corporate Benefit Office. See the "Administrative Information"
section
for information about where you can examine these documents.
. You can obtain copies of all plan documents and other plan
information
upon written request to the Corporate Benefit Office. You will
be
charged a reasonable fee for copies of the documents requested
unless
federal law requires that they be furnished without charge. See
the
"Administrative Information" section to learn where to direct
correspondence.
. You can receive a summary of the RSP's annual financial report
a copy of
this summary annual report is furnished to each participant
once a year.
In addition to creating rights for plan participants, ERISA
imposes
duties upon the people who are responsible for the operation of
the member
benefit plans. These people, called fiduciaries of the plan, have
a duty to
operate the plans prudently and in the interest of plan
participants and
beneficiaries. No one, including your employer or any other
person, may
fire you or otherwise discriminate against you in any way to
prevent you
from obtaining a benefit or exercising your rights under ERISA.
If your claim for benefits is denied in whole or in part,
you will
receive a written explanation of the reason for
the denial. If you do not hear from the appropriate party within
the
designated time frame, your claim or appeal is considered denied.
You have
the right to have the appropriate party review and reconsider
your claim.
(See the "Claim and Appeal Procedures" section.)
Under ERISA, there are steps you can take to enforce the
above rights.
For instance, if you request materials from the plan and do not
receive
them within 30 days, you may file suit in a federal court. In
such cases,
the court may require the Company to provide the materials and
pay you up
to $100 a day until you receive the materials, unless the
materials were
not sent for reasons beyond the control of the Company. If you
have a claim
32
for benefits that is denied or ignored, in whole or in part, you
may file
suit in a state or federal court.
If plan fiduciaries misuse the plan's money, or if you are
discriminated against for asserting your rights under ERISA, you
may seek
assistance from the U.S. Department of Labor, or you may file
suit in
federal court. The court will decide who will pay court costs and
legal
fees. If you are successful, the court may order the person you
have sued
to pay these costs and fees. If you lose, the court may order you
to pay
costs and fees, for example, if it finds your claim to be
frivolous.
For answers to questions about the RSP, contact the
Corporate Benefit
Office or the recordkeeper, as appropriate. See the
"Administrative
Information" section for information about whom to contact. If
you have any
questions about this statement of your rights, or about your
rights under
ERISA, contact the nearest area office of the Pension and Welfare
Benefits
Administration, U.S. Department of Labor.
ADMINISTRATIVE INFORMATION
Plan Name
The official plan name is the AT&T Capital Corporation
Retirement and
Savings Plan.
Recordkeeper
The recordkeeper is Merrill Lynch Group Member Services, 265
Davidson
Avenue, Somerset, New Jersey 08873.
800-228-401K
Trustee
The trustee is Merrill Lynch Trust Company, 300 Davidson
Avenue,
Somerset, New Jersey 08873.
Plan Administrator
The Plan Administrator for the AT&T Capital Corporation
Retirement and
Savings Plan is AT&T Capital Corporation. An Administrative
Committee
appointed by the Compensation Committee of AT&T Capital
Corporation's Board
of Directors administers the RSP on AT&T Capital Corporation's
behalf.
Administrative Committee
The Administrative Committee is located at AT&T Capital
Corporation,
44 Whippany Road, Morristown, New Jersey 07962. The current
members of the
Administrative Committee are the Corporate Resource Officer and
the General
Counsel of AT&T Capital Corporation.
33
Legal Service
Direct process of legal service to AT&T Capital Corporation,
44
Whippany Road, Morristown, New Jersey 07962 (Attn: General
Counsel).
Corporate Benefit Office
AT&T Capital Corporation
Attn: Corporate Benefit Office
44 Whippany Road
Morristown, New Jersey 07962
201-397-3000
Type of Plan, Plan Records, and Plan Year
The AT&T Capital Corporation Retirement and Savings Plan is
considered
a pension plan and an individual account plan under the Member
Retirement
Income Security Act of 1974, as amended (ERISA). As an individual
account
plan, contributions to and benefits under the RSP are not
guaranteed by the
Pension Benefit Guaranty Corporation. The RSP and all records are
kept on a
calendar-year basis beginning January 1 and ending December 31.
Employer and Plan Identification Numbers
AT&T Capital Corporation and the RSP are identified by the
following
numbers under Internal Revenue Service rules:
Description Number
Employer Identification 22-3211453
Number (assigned by
the IRS)
Plan Identification 001
Number (assigned by
AT&T Capital Corporation)
Plan Documents
The information contained in this summary plan description
provides
only the highlights of the AT&T Capital Corporation Retirement
and Savings
Plan. It does not attempt to cover all details. RSP details are
contained
in the official plan documents. These documents legally govern
the
operation of the RSP.
You can review the plan documents, as well as the annual
report of the
RSP as filed with the federal government, at the Corporate
Benefit Office
during normal working hours. You must submit your request to
review
documents in writing and allow 10 days for your request to be
processed. If
you submit a written request to the Corporate Benefit Office, you
can
obtain copies of these documents within 30 days. You will be
charged a
reasonable fee for the copies unless federal law requires that
the
documents be furnished without charge.
Submit all requests in writing to the Corporate Benefit
Office.
34
Payment of Benefits and Plan Funding
Your contributions, matching contributions, and uniform
points
contributions to the RSP go into a trust fund managed under the
terms of a
trust agreement by the RSP's trustee: Merrill Lynch. The Trustee
pays all
benefits under the RSP from the available funds in the trust.
Funds are
held in the trust exclusively for participants in the RSP and
their
beneficiaries.
Plan Expenses
Certain expenses incurred in administering the RSP are paid
from the
trust fund, including some recordkeeping fees, confirmation fees,
asset
transfer expenses, proxy fees, check processing fees, enrollment
and
communication expenses, and similar expenses. Expenses that
relate to a
particular participant's account such as loan application fees
are
allocated to that account. All other expenses are allocated among
the
accounts of all the participants If you have any questions about
the
allocation of these expenses, please contact the recordkeeper or
the
Corporate Benefits Office.
Plan Continuation
The Compensation Committee of the Board of Directors of AT&T
Capital
Corporation (or its delegate) reserves the right to amend,
suspend, or
terminate the RSP at any time. If the RSP is terminated, if there
is a
partial termination affecting you, or if the Company permanently
ceases
contributions to the RSP, you will immediately be 100% vested in
the value
of all uniform points contributions as of the date of
termination.
AT&T Capital Corporation does not guarantee the continuation of
any
benefits during employment, nor does it guarantee any specific
level of
benefits. Also, benefits are provided at AT&T Capital
Corporation's
discretion and do not create a contract of employment.
AT&T Capital Corporation
EXCESS BENEFIT PLAN
Purpose of the Excess Benefit Plan
The Internal Revenue Code imposes certain limits on the
amount of
contributions that may be made on your behalf to the AT&T Capital
Corporation Retirement and Savings Plan. The AT&T Capital
Corporation
Excess Benefit Plan is designed to allow you to save as much as
possible
for your retirement by allowing AT&T Capital Corporation and its
subsidiaries to credit contributions in excess of certain
Internal Revenue
Code limits to this plan on your behalf.
This summary refers to AT&T Capital Corporation and its
subsidiaries
collectively as the "Company."
The Excess Benefit Plan is considered an "unfunded" plan
under the
Member Retirement Income Security Act of 1974, as amended (see
"Payment of
Benefits and Plan Funding" on page 41). One advantage of the
"unfunded"
nature of the Excess Benefit Plan is that you will not have to
pay taxes on
35
amounts credited to your account until those accounts are paid to
you.
Internal Revenue Code Limits
The Internal Revenue Code limits the amount of your
contributions,
matching contributions, and uniform points contributions that may
be made
to the Retirement and Savings Plan on your behalf. In general,
these
contributions may not exceed the lesser of $30,000 or 25% of your
taxable
pay in any calendar year.
Participation
If the total contributions for a year to the Retirement and
Savings
Plan would exceed the $30,000 or 25% of pay (pay still includes
only
compensation up to the 401(a)(17) limits this limit is $150,000
in 1994)
Internal Revenue Code limit, you will automatically become a
participant in
this Excess Benefit Plan. You won't have to do anything to
enroll.
The Corporate Benefit Office will notify you if you become a
participant.
CONTRIBUTIONS TO YOUR ACCOUNT
When you become a participant in the Excess Benefit Plan,
the Company
will establish an account on your behalf. No contributions to the
Retirement and Savings Plan will be made in excess of the $30,000
or 25% of
pay Internal Revenue Code limit. However, in any year in which
the total
contributions on your behalf would exceed either of these limits,
the
Company will credit to your account under this Excess Benefit
Plan uniform
points contributions and matching contributions in excess of the
Internal
Revenue Code ($30,000/25% of pay) limit. Pay still includes only
compensation up to the Internal Revenue Code limit of $150,000 in
1994. If
the Internal Revenue Code limit is still exceeded, then your
after-tax and
before-tax contributions in excess of the limit will be refunded
to you.
Example:
Let's assume the following:
Your pay is $25,000 before reduction for before-tax
contributions,
. You make the maximum before-tax contribution
. permitted under the Retirement and Savings Plan of 12% (i.e.,
$3,000),
. A matching contribution of 4% is allocated to your account
under the
Retirement and Savings Plan, and
. An uniform points contribution of 9% of pay before reduction
for before-tax contributions would be allocated to your account
under the
Retirement and Savings Plan if there were no Internal Revenue
Code
limits.
The total contributions under the Retirement and Savings Plan are
calculated as follows:
$25,000 x 9% (uniform points contribution) = $2,250
$25,000 x 12% (your before-tax contribution) = $3,000
$25,000 x 4% (matching contribution) = $1,000
$6,250
Even though these percentages (9% + 12% + 4%) add up to only 25%,
the
Internal Revenue Code limit would still affect you. This is
because in
computing the Internal Revenue Code limit, your before-tax
contributions to
36
the Retirement and Savings Plan (and to the Company's flexible
benefits
program) are deducted from your pay first.
Therefore, in applying the limitation, your "pay" would be only:
$ 25,000
- 3,000 (before-tax contributions)
$ 22,000
The Internal Revenue Code limitation would then equal $5,500
($22,000 x
25%).
Because total contributions of $6,250 exceed the Internal Revenue
Code
limitation of $5,500, the excess amount ($750) cannot be
contributed to the
Retirement and Savings Plan.
However, $750 will be credited to your Excess Benefit Plan
account.
EARNINGS ON YOUR ACCOUNT
Excess Plan Investments
All amounts credited under the Excess Benefit Plan for an
eligible
active member will be credited to an account on the Company's or
recordkeeper's books.
The amounts in your account will be deemed to be periodically
invested and
reinvested in designated investment fund shares identified by
the
Company.
. Your account will be adjusted to reflect gains, losses, and
earnings as
though the amounts were in fact invested and reinvested in
investment
fund shares.
At present it is not clear whether allowing members to
direct their
own investments is practicable or may jeopardize the plan's
"unfunded"
status.
Consequently your investment directions will not be applied
to your
account at this time. The Administrative Committee will instead
credit your
account with interest at a rate no less than the rate of return
on
investments in the Merrill Lynch Government Fund, or a similar
investment
option.
VESTING
You vest in contributions and earnings credited to your
account in the
same manner as under the Retirement and Savings Plan. (See pages
12 through
14 for information about vesting.)
NONTRANSFERABILITY OF BENEFITS
You or your beneficiary may not assign or transfer amounts
under the
Excess Benefit Plan. Similarly, amounts credited to your account
may not be
used to pay your debts or obligations.
37
PAYMENT OF YOUR EXCESS BENEFIT PLAN BENEFIT
The vested portion of your Excess Benefit Plan account will
be paid to
you in 60 monthly installments beginning as of the later of the
first day
of the month after:
You reach age 65, or
. You terminate employment with the Company (or any affiliate).
However, you may ask the Company to pay your account at any
time after
you terminate employment or in another form. The Company, in its
sole
discretion, may elect to:
Pay your benefit to you in any form available under the
Retirement and
Savings Plan that it considers appropriate, and
. Begin to pay your benefit as of the first day of any month
after
termination of your employment it you terminate before your
65th
birthday.
If you die before you have received your vested Excess
Benefit Plan
account, the vested balance will be paid in a lump sum to your
spouse or,
if not married, your beneficiary under the AT&T Capital
Corporation
Retirement and Savings Plan.
Forfeitures
If you leave the Company (unless you transfer to an
affiliated
company) before you are fully vested, you will forfeit the
nonvested
portion of your Excess Benefit Plan account when you have a
five-year break
in service.
CLAIM AND APPEAL PROCEDURES
Claim Procedures
If you are vested when you leave the Company, your Excess
Benefit Plan
benefit will be paid automatically upon termination of your
employment from
the Company or your 65th birthday. If you believe you are
eligible and you
don't receive an Excess Benefit Plan benefit, you have a right to
file a
written application for benefits.
If your claim for benefits is denied, either in whole or in
part, you
will receive written notification from the Corporate Benefit
Office. This
written notification will include:
The specific reason or reasons for the denial,
. Specific reference to pertinent Excess Benefit Plan provisions
on which
the denial was based,
. A description of any additional material or information
necessary to
perfect the claim and an explanation of why the material or
information
is necessary, and
. Appropriate information about the steps to be taken if you or a
person
authorized to represent you wishes to submit the claim for
review.
38
after receiving your claim submitted according to the procedures
described
in this section. This 90-day period may be extended up to an
additional 90
days if the Corporate Benefit Office notifies you before the
original 90-day period expires.
If a claim for benefits is denied, in whole or in part, or
if you
believe that benefits under the Excess Benefit Plan to which you
are
entitled have not been provided, you or your authorized
representative may
appeal this denial or other action by the Corporate Benefit
Office.
Appeal Procedures
Please note that the Excess Benefit Plan requires that you
pursue all
your claim and appeal rights described in this section before you
seek any
other legal recourse regarding claims for benefits.
You must appeal in writing within 60 days after you receive
notification of the Corporate Benefit Office's decision or, if
you didn't
receive notification, within 60 days after the 90-day period has
lapsed.
Send your written request for review of any denied claim or other
disputed
matter directly to the Administrative Committee at the address
listed on
page 40. The person sending the request has the right to:
Review pertinent plan documents. You can obtain them by following
the
procedures described under "Plan Documents," page 41, and
. Send to the Administrative Committee a written statement of the
issues
and any other documents in support of the claim for benefits or
other
matter under review.
The Administrative Committee will provide a written response
to the
appeal within 60 days after it is received. The 60-day period may
be
extended up to an additional 60 days if the Administrative
Committee
notifies you before the original 60-day period expires. If the
Administrative Committee does not respond within 60 (or 120)
days, you may
consider the claim denied.
The Administrative Committee serves as the final review
committee
under the Excess Benefit Plan and has sole and complete
discretionary
authority to determine conclusively for all parties, and in
accordance with
the terms of the documents or instruments governing the Excess
Benefit
Plan, any and all questions arising from administration of the
Excess
Benefit Plan and interpretation of all plan provisions,
determination of
all questions relating to participation of eligible members and
eligibility
for benefits, determination of all relevant facts, the amount and
type of
benefits payable to any participant, and construction of all
terms of the
Excess Benefit Plan.
Notwithstanding the foregoing, AT&T Capital Corporation has
sole and
complete discretionary authority to determine questions relating
to
eligibility for participation in the Excess Benefit Plan and to
amend or
terminate the Excess Benefit Plan at any time. Respective
decisions by the
Administrative Committee and AT&T Capital Corporation shall be
conclusive
and binding on all parties and not subject to further review.
39
ADMINISTRATIVE INFORMATION
Plan Name
The official plan name is the AT&T Capital Corporation
Excess Benefit
Plan.
Recordkeeper
The recordkeeper is Merrill Lynch Group Member Services, 265
Davidson
Avenue, Somerset, New Jersey 08873.
Trustee
The trustee is Merrill Lynch Trust Company, 300 Davidson
Avenue,
Somerset, New Jersey 08873.
Plan Administrator
The Plan Administrator for the AT&T Capital Corporation
Excess Benefit
Plan is AT&T Capital Corporation. An Administrative Committee
appointed by
the Compensation Committee of the Board of Directors of AT&T
Capital
Corporation administers the Excess Benefit Plan on AT&T Capital
Corporation's behalf.
Administrative Committee
The Administrative Committee is located at AT&T Capital
Corporation,
44 Whippany Road, Morristown, New Jersey 07962. Currently the
Administrative Committee members are the Corporate Resource
Officer and the
General Counsel of AT&T Capital Corporation.
Legal Service
Direct process of legal service to AT&T Capital Corporation,
44
Whippany Road, Morristown, New Jersey 07962 (Attn: General
Counsel).
Corporate Benefit Office
The Corporate Benefit Office
AT&T Capital Corporation
Attn: Corporate Benefit Office
44 Whippany Road
Morristown, NJ 07962
201-397-3000
Type of Plan, Plan Records, and Plan Year
The AT&T Capital Corporation Excess Benefit Plan is exempt
from most
of the requirements under the Member Retirement Income Security
Act of
1974, as amended ("ERISA"). It is a nonqual-ified pension plan
under the
Internal Revenue Code. Benefits under the Excess Benefit Plan are
not
guaranteed by the Pension Benefit Guarantee Corporation
The Excess Benefit Plan and all records are kept on a
calendar-year
basis beginning January 1 and ending December 31.
40
Employer and Plan Identification Numbers
AT&T Capital Corporation and the Excess Benefit Plan are
identified by the
following numbers under Internal Revenue Service rules:
Description Number
Employer Identification 22-3211453
Number (assigned by the IRS)
Plan Identification Number 002
(assigned by AT&T Capital
Corporation)
Plan Documents
The information contained in this summary plan description
provides
only the highlights of the AT&T Capital Corporation Excess
Benefit Plan. It
does not attempt to cover all details. Excess Benefit Plan
details are
contained in the official plan documents. These documents legally
govern
the operation of the Excess Benefit Plan.
You can review the Excess Benefit Plan documents at the
Corporate
Benefit Office during normal working hours. You must submit your
request to
review in writing and allow 10 days for your request to be
processed. If
you submit a written request to the Corporate Benefits Office,
you can
obtain copies of these documents within 30 days. You will be
charged a
reasonable fee for the copies unless federal law requires that
the
documents be furnished without charge.
Submit all requests in writing to the Corporate Benefit
Office.
Payment of Benefits and Plan Funding
The Excess Benefit Plan is considered an "unfunded" deferred
compensation plan under ERISA and the Internal Revenue Code.
However, AT&T
Capital Corporation has established a trust to which it intends
to make
regular contributions to fund its obligations under the Excess
Benefit
Plan. Funds are held in the trust to pay benefits for Excess
Benefit Plan
participants. However, if the Company becomes insolvent, the
trust may be
used to pay benefits to the general creditors of the Company.
Excess
Benefit Plan benefits will be paid primarily from this trust. If
there are
insufficient assets in the trust, Excess Benefit Plan benefits
will then be
paid from the general assets of the Company.
Plan Continuation
The Compensation Committee of the Board of Directors of AT&T
Capital
Corporation (or its delegate) reserves the right to modify,
suspend,
change, or terminate the Excess Benefit Plan at any time. AT&T
Capital
Corporation does not guarantee the continuation of any benefits
during
employment, nor does it guarantee any specific level of benefits.
Also,
benefits are provided at AT&T Capital Corporation's discretion
and do not
create a contract of employment.