Exhibit 10.24
DIMON INCORPORATED
CASH BALANCE PLAN
Amended and Restated
Effective July 1, 1996
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DIMON INCORPORATED CASH BALANCE PLAN
Table of Contents
Page
ARTICLE 1 DEFINITIONS......................................... 1
1.1 Account............................................. 1
1.2 Account Balance..................................... 1
1.3 Accrued Benefit..................................... 1
1.4 Actuarial Equivalent................................ 2
1.5 Beginning Account Balance........................... 3
1.6 Benefit Commencement Date........................... 3
1.7 Board............................................... 3
1.8 Cash Balance Account................................ 3
1.9 Code................................................ 3
1.10 Committee........................................... 4
1.11 Company............................................. 4
1.12 Compensation........................................ 4
1.13 Controlled Group.................................... 4
1.14 Dibrell Plan........................................ 5
1.15 Disability.......................................... 5
1.16 Early Retirement Date............................... 5
1.17 Effective Date...................................... 6
1.18 Employee............................................ 6
1.19 Employer............................................ 6
1.20 Employment.......................................... 7
1.21 Employment Date..................................... 7
1.22 ERISA............................................... 7
1.23 Fiduciary........................................... 7
1.24 Five-Year Break..................................... 7
1.25 Hours of Service.................................... 7
1.26 Interest Credit..................................... 10
1.27 Interest Credit Percentage.......................... 11
1.28 Investment Manager.................................. 11
1.29 Leased Employee..................................... 11
1.30 Military Leave...................................... 12
1.31 Monk-Austin Plan.................................... 12
1.32 Normal Retirement Age............................... 12
1.33 Normal Retirement Date.............................. 13
1.34 One-Year Break...................................... 13
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Page
1.35 Participant......................................... 13
1.36 Plan................................................ 13
1.37 Plan Administrator.................................. 13
1.38 Plan Year........................................... 13
1.39 Qualified Domestic Relations Order.................. 13
1.40 Retirement Credit................................... 15
1.41 Retirement Credit Percentage........................ 15
1.42 Spouse or Surviving Spouse.......................... 15
1.43 Termination Date.................................... 16
1.44 Trust (or Trust Fund)............................... 16
1.45 Trustee............................................. 16
1.46 Uniformed Service................................... 16
1.47 USERRA.............................................. 16
1.48 Years of Service.................................... 17
ARTICLE 2 ELIGIBILITY......................................... 19
2.1 Eligibility......................................... 19
2.2 Participation Upon Reemployment..................... 20
2.3 Adoption of Plan by Controlled Group Member......... 21
2.4 Leased Employees.................................... 21
ARTICLE 3 CASH BALANCE ACCOUNTS............................... 23
3.1 Allocations to Cash Balance Account................. 23
3.2 Vesting............................................. 26
3.3 Disability Benefit.................................. 26
3.4 Reemployment........................................ 28
ARTICLE 4 PAYMENT ON ACCOUNT BALANCES......................... 30
4.1 Payment Dates....................................... 30
4.2 Automatic Form of Payment........................... 32
4.3 Election of Optional Form of Payment................ 36
4.4 Description of Forms of Payment..................... 37
4.5 Effect of Death on Forms of Payment................. 40
4.6 Designation of Beneficiaries........................ 41
4.7 Payment to Participant's Representative............. 42
4.8 Unclaimed Benefits.................................. 43
4.9 Required Distribution Rules......................... 43
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Page
ARTICLE 5 PRERETIREMENT DEATH BENEFITS........................ 44
5.1 Married Vested Participants......................... 44
5.2 Unmarried Participant or Nonvested Participant...... 45
ARTICLE 6 LIMITATIONS ON BENEFIT AMOUNTS...................... 46
6.1 Code Section 415 Limits............................. 46
6.2 Restrictions on Benefits Payable to the 25
Highest-Paid Participants........................... 55
6.3 Top-Heavy Rules..................................... 56
ARTICLE 7 CONTRIBUTIONS....................................... 63
7.1 Employer Contributions.............................. 63
7.2 Participant Contributions........................... 63
7.3 Return of Contributions to the Employers............ 63
7.4 Actuarial Gains..................................... 64
ARTICLE 8 AMENDMENT, TERMINATION, MERGER...................... 65
8.1 Amendment........................................... 65
8.2 Termination of the Plan............................. 66
8.3 Merger.............................................. 68
ARTICLE 9 APPOINTMENTS AND ALLOCATION OF FIDUCIARY
RESPONSIBILITY...................................... 69
9.1 Named Fiduciary..................................... 69
9.2 Plan Administrator.................................. 69
9.3 Investment and Administrative Committee............. 69
9.4 Actuary............................................. 69
9.5 Accountant.......................................... 70
9.6 Allocations of Fiduciary Responsibility............. 70
9.7 General............................................. 71
9.8 Fiduciary Discretion................................ 71
ARTICLE 10 PLAN ADMINISTRATION............................... 73
10.1 General............................................. 73
10.2 Disclosure.......................................... 74
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Page
10.3 Annual Accountings.................................. 75
10.4 Actuarial Services and Certification................ 75
10.5 Funding Policy...................................... 76
10.6 Expenses - Compensation............................. 76
10.7 Directions to Trustee............................... 77
10.8 Claims Procedure.................................... 77
ARTICLE 11 THE INVESTMENT AND ADMINISTRATIVE COMMITTEE....... 79
11.1 Committee........................................... 79
11.2 Meetings - Actions.................................. 79
11.3 Powers of Committee................................. 80
11.4 Agents and Counsel.................................. 81
11.5 Compensation........................................ 81
11.6 Officers............................................ 82
11.7 Rules and Regulations............................... 82
ARTICLE 12 MISCELLANEOUS..................................... 83
12.1 Headings............................................ 83
12.2 Construction........................................ 83
12.3 Qualification for Continued Tax-Exempt Status....... 83
12.4 Nonalienation....................................... 83
12.5 No Employment Rights................................ 84
12.6 No Enlargement of Rights............................ 84
12.7 Single Employer Plan................................ 84
12.8 Exclusive Purpose................................... 84
12.9 Errors and Omissions................................ 85
Addendum A History of Revised Plan Provisions
Addendum B Required Distribution Rules
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DIMON INCORPORATED CASH BALANCE PLAN
INTRODUCTION
Dimon Incorporated, formerly Dibrell Brothers, Incorporated (the
Company), hereby amends and restates the Retirement Plan for
Employees of Dibrell Brothers and Subsidiary Companies (the
Dibrell Plan), as set forth in this document, effective July 1,
1996. The Company initially adopted the Dibrell Plan February 1,
1951, and has always maintained the Plan as a qualified
retirement plan. Until the 1989 Plan Year, the Company also
maintained the Dibrell Brothers Incorporated Savings and Profit
Sharing Plan as a floor-offset arrangement. Effective January 1,
1989, the Company eliminated the offset for the profit sharing
plan.
This restatement converts the Dibrell Plan to a cash balance plan
and renames it the Dimon Incorporated Cash Balance Plan (the
Plan). The Plan continues to be a defined benefit retirement
plan, with nominal account balances. The Plan is designed to
comply with all qualification requirements that apply to cash
balance plans under Sections 401(a) and 501(a) of the Internal
Revenue Code of 1986, as amended (the Code), and with all
applicable provisions of the Employee Retirement Income Security
Act of 1974, as amended (ERISA).
The provisions of this amended and restated Plan supersede the
Dibrell Plan for all eligible employees who are employed by the
Company on or after July 1, 1996. Each participant in the Plan
will have a bookkeeping account, the balance of which is equal to
his accrued benefit as of the date of determination. Each Dimon
employee who participated in the Dibrell Plan will have a
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beginning account balance in this Plan equal to the lump-sum
present value of his benefit accrued under the Dibrell Plan as of
June 30, 1996, based on the actuarial assumptions in effect on
June 30, 1996. Each Dimon employee who was a participant in the
Monk-Austin Profit Sharing Plan on June 30, 1995, will have a
beginning account balance equal to an amount calculated by a
special formula set forth in this Plan.
The history of revised Dibrell Plan provisions is set forth in
Addendum A, to the extent that the historical provisions can
affect any Participant's benefits under this Plan. The required
distribution rules under Code section 401(a)(9) are set forth in
Addendum B. The Addenda are integral parts of the Plan.
The rights of any employee who participated in the Dibrell Plan
and terminated before July 1, 1996, will be determined under the
terms of the Dibrell Plan as in effect on the date such employee
terminated.
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ARTICLE 1
DEFINITIONS
As used in the Plan, the following words and phrases and any
derivatives thereof will have the meanings set forth below unless
the context clearly indicates otherwise. Definitions of other
words and phrases applicable to the limitations on benefit
amounts are set forth in Article 6. Section references indicate
sections of the Plan unless otherwise stated. The masculine
pronoun includes the feminine, and the singular number includes
the plural and the plural the singular, whenever applicable.
1.1 Account. The Participant's Cash Balance Account (See Plan
sections 1.8 and 3.1).
1.2 Account Balance. The balance in the Participant's Cash
Balance Account, calculated under Plan section 3.1 by
totaling his Beginning Account Balance (if any), plus the
sum of the annual Retirement Credits allocated to his
Account, plus the sum of the annual Interest Credits
allocated to his Account.
1.3 Accrued Benefit. The annual benefit payable as of the
Participant's Normal Retirement Date as a five years certain
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and life annuity (the normal form), which is the Actuarial
Equivalent of his Account Balance projected to his Normal
Retirement Date using the Interest Credit Percentage in
effect as of the date of determination, and annuitized using
the Actuarial Equivalent factors described in Plan section
1.4(b). If the Accrued Benefit is paid prior to the
Participant's Normal Retirement Date, the Plan will convert
the annuity payable as of the Participant's Normal
Retirement Date to an immediate five years certain and life
annuity payable as of such early commencement date, using
the Actuarial Equivalent factors described in Plan section
1.4(b).
1.4 Actuarial Equivalent. Effective July 1, 1996, a benefit of
equal value computed on the following bases:
(a) Annuity Forms of Payment. The 1971 TPF&C Forecast
Mortality Table, with a one-year setback for
Participants and a five-year setback for beneficiaries,
and interest at the rate of 6 percent compounded
annually, except that the Committee will use the lump
sum conversion factors set forth in subsection (b) to
value the five years certain and life annuity (the
normal form).
(b) Lump Sum Payments. The applicable mortality table and
the applicable interest rate established by the
Internal Revenue Service under Code section 417(e)(3)
as in effect for the month of November preceding the
Plan Year in which the payment is made.
The Actuarial Equivalent factors in effect before June 30,
1996, are set forth in Addendum A.
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1.5 Beginning Account Balance. The amount credited as of July
1, 1996, to the Cash Balance Account of each Participant who
is eligible for a Beginning Account Balance under Plan
section 3.1(a).
1.6 Benefit Commencement Date. The first day of the first month
for which a benefit is payable as an annuity to the
Participant under Articles 3 and 4, or to his Surviving
Spouse under Article 5. If the benefit is payable in a lump
sum, the Benefit Commencement Date is the date when the
Trustee issues the payment, and the Plan will use the
interest rate in effect determined under Plan section 1.4(b)
as of the first day of the Plan Year in which payment is
made. A Participant's Benefit Commencement Date is
determined subject to the procedures set forth in Plan
section 4.2.
1.7 Board. The Board of Directors of the Company.
1.8 Cash Balance Account. The bookkeeping account used to
record the Participant's Account Balance.
1.9 Code. The Internal Revenue Code of 1986 as amended from
time to time, and regulations and rulings issued under the
Code.
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1.10 Committee. The Investment and Administrative Committee,
which will have primary responsibility for administering the
Plan under Article 11.
1.11 Company. Dimon Incorporated, a Virginia corporation, or its
successor or assign which adopts the Plan.
1.12 Compensation.
(a) For Accrued Benefit and Nondiscrimination Testing. The
taxable earnings paid in cash by the Employer to the
Participant and reported on his Form W-2 for the
calendar year, excluding commissions and extra pay for
temporary foreign service, plus amounts deferred under
Code sections 401(k) and 125 pursuant to the
Participant's salary reduction agreement. This
definition of Compensation will be used to determine
key employee status under Plan section 6.3(a).
(b) Statutory Cap. Each Participant's Compensation taken
into account for all purposes under the Plan will be
limited to $150,000 (as indexed under Code section
401(a)(17)).
1.13 Controlled Group. The Company and
(a) a member of a controlled group of corporations as
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defined in Code section 1563(a), determined without
regard to Code section 1563(a)(4) and 1563(e)(3)(C), of
which an Employer is a member according to Code
section 414(b);
(b) an unincorporated trade or business that is under
common control with an Employer as determined according
to Code section 414(c);
(c) a member of an affiliated service group of which an
Employer is a member according to Code section 414(m);
or
(d) any entity required to be aggregated according to Code
section 414(o).
1.14 Dibrell Plan. For convenient reference to benefits that
accrued before the July 1, 1996, Effective Date of the Plan
(which benefits are the Beginning Account Balances in this
Plan), this document refers to the Plan as it existed before
that date as the Dibrell Plan, which was formally named the
Retirement Plan for Employees of Dibrell Brothers and
Subsidiary Companies.
1.15 Disability. A physical or mental incapacity which qualifies
the Participant for benefits under a long-term disability
plan maintained by his Employer. The term Disabled
Participant is used to refer to the Participant who has
incurred a Disability and has not recovered.
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1.16 Early Retirement Date. The first day of the month on or
after the date when the Participant has both reached age 55
and completed 10 Years of Service.
1.17 Effective Date. February 1, 1951, is the initial Effective
Date. July 1, 1996, is the Effective Date of this
amendment, restatement, and conversion to the cash balance
formula. The Effective Date for each Employer is the
effective date of its adoption of the Plan.
1.18 Employee. An individual who is employed by an Employer and
for whom the Employer withholds payroll taxes; provided that
(a) any individual who is scheduled to work fewer than five
months per year, or fewer than 20 hours per week, will be
excluded unless he actually earns 1,000 Hours of Service
during a Plan Year or during the first 12 months of his
employment; (b) any individual who is a member of a
collective bargaining unit for whom retirement benefits were
the subject of good-faith bargaining will be excluded,
unless coverage under the Plan has been or is extended to
such individuals through the collective bargaining process;
(c) Leased Employees will be excluded; (d) independent
contractors will not be treated as Employees; and (e) any
individual who is covered by an employment agreement that
precludes his participation will be excluded.
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1.19 Employer. The Company and each Controlled Group member
which adopts and participates in the Plan, and each
Employer's successor or assign which adopts the Plan.
1.20 Employment. The period during which an Employee is employed
by an Employer, beginning on the Employer's Effective Date,
or on an earlier date for purposes of calculating his Years
of Service to the extent described in the Employer's
Addendum.
1.21 Employment Date. The date on which the Employee earned his
first Hour of Service with his Employer; provided that the
Employment Date of the nonvested Employee who resumed
Employment after he incurred a Five-Year Break will be the
date on which he earned his first Hour of Service after he
resumed Employment.
1.22 ERISA. The Employee Retirement Income Security Act of 1974,
as amended from time to time, and regulations and rulings
issued under ERISA.
1.23 Fiduciary. A person or entity as defined in ERISA section
3(21).
1.24 Five-Year Break. Five consecutive One-Year Breaks, which
will cause the nonvested Participant to lose his pre-break
Years of Service.
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1.25 Hours of Service.
(a) Periods of Credit. Hours of Service will be credited
for the following:
(1) Working Hours. Each hour for which the Employee
is paid or entitled to payment of Compensation by
an Employer for the performance of duties.
(2) Nonworking Hours. Each hour for which the
Employee is paid or is entitled to payment of
Compensation by an Employer on account of a period
of time during which no duties are performed due
to vacation, holiday, illness, incapacity, layoff,
jury duty, military duty, or leave of absence,
whether or not his Employment has terminated.
(3) Back Pay. Each hour for which back pay, without
regard to mitigation of damages, is either awarded
or agreed to by the Employer.
(b) Periods of No Credit. Hours of Service will not be
credited for the following:
(1) Nonpayment. Periods during which the Employee is
neither paid nor entitled to payment of
Compensation.
(2) Limited Number. Hours in excess of 501 in a
single continuous period during which no duties
are performed.
(3) Statutory Payments. Hours for which payment is
made or due under a plan maintained solely for the
purpose of complying with workers' compensation,
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unemployment compensation, or disability insurance
laws.
(4) Back Pay. Back pay where credit has already been
given for the hours to which the back pay relates.
(5) Medical Expenses. A payment which solely
reimburses an Employee for medical or medically
related expenses incurred by him.
(c) Crediting Hours of Service - General Rule. Hours of
Service will be credited to the period in which the
duties to which they relate are performed, or the
period when no duties are performed, as applicable.
The Plan will use payroll records to determine Hours of
Service for each Employee for whom the Employer records
actual hours worked. For the Employee for whom the
Employer does not record actual hours worked, the Plan
will credit 190 Hours of Service for each month in
which he earns at least one Hour of Service.
(d) Crediting Hours of Service - Special Rules. Hours of
Service will be credited for the following types of
leaves under the following special rules:
(1) Parental Leave. Solely for purposes of
determining whether a One-Year Break has occurred,
the Plan will treat as Hours of Service periods
during which an Employee is absent from work by
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reason of pregnancy, child birth, child adoption,
and/or child care immediately following birth or
adoption. The number of Hours of Service credited
to the Employee will be the number of hours that
would have been credited if the absence had not
occurred, or if such number cannot be determined,
then eight Hours of Service will be credited for
each day of the absence, provided that the total
number of such Hours of Service will not exceed
501. Such Hours of Service will be credited to
the Plan Year in which the absence begins only if
that credit is necessary to avoid a One-Year Break
in that Plan Year; otherwise, credit will be given
in the immediately following Plan Year. No credit
will be given under this subsection unless the
Employee timely provides to the Committee all
information reasonably required to establish (A)
that the absence is for a reason described in this
subsection, and (B) the number of days of absence
attributable to such reason.
(2) Military Leave. In calculating a Participant's
Hours of Service for purposes of determining the
nonforfeitability of a Participant's Accrued
Benefit, eligibility to participate and benefit
accrual purposes, a Participant shall be deemed to
have earned a number of Hours of Service equal to
the product of (A) the number of calendar months
(or a fraction thereof) that the Participant was
absent from employment with his Employer due to
Military Leave, and (B) the average Hours of
Service per month the Participant earned during
the 12-month period immediately preceding the
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Military Leave (or, if shorter, the period of the
Participant's employment with his Employer
immediately preceding the Military Leave).
(3) Authorized Leave of Absence. Solely for purposes
of determining whether a Participant has earned
501 Hours of Service and of determining the
nonforfeitability of a Participant's Accrued
Benefit and Eligibility to participate, the Plan
will give him credit for eight hours for each day
of his leave granted under the Family and Medical
Leave Act.
1.26 Interest Credit. The amount credited to the Participant's
Cash Balance Account as of the last day of each Plan Year,
which amount is calculated by multiplying his year-end
Account Balance by the Interest Credit Percentage for the
Plan Year, as described in Plan section 3.1(c).
1.27 Interest Credit Percentage. The interest rate used to
calculate Interest Credits for each Plan Year, which rate is
determined as of the first day of the Plan Year and is based
on the average rate paid on 12-month Treasury Bills during
the month of November in the preceding year, plus one
percent, as described in Plan section 3.1(c).
1.28 Investment Manager. A person or entity, other than the
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Trustee or a Named Fiduciary, that has the power to acquire
and dispose of Plan assets and that is either
(a) an investment advisor registered under the Investment
Advisors Act of 1940;
(b) a bank as defined in the Investment Advisors Act of
1940; or
(c) an insurance company qualified to manage assets of
retirement plans or perform similar functions under the
laws of more than one state;
and that acknowledges in writing that it is a Fiduciary with
respect to the Plan.
1.29 Leased Employee. Any person (other than an employee of an
Employer) who pursuant to an agreement between an Employer
and any other entity that is not a member of the Employer's
Controlled Group ("leasing organization") has performed
services for an Employer, on a substantially full-time basis
for a period of at least one year, and such services are of
a type historically performed by employees in the business
field of an Employer. Effective for Plan Years beginning on
and after January 1, 1997, the phrase "of a type
historically performed by employees in the business field of
an Employer" at the end of the preceding sentence is
replaced by the phrase "under the primary direction or
control of an Employer." Contributions or benefits provided
a Leased Employee by the leasing organization which are
attributable to services performed for an Employer shall be
treated as provided by an Employer.
1.30 Military Leave. The performance of duty on a voluntary or
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involuntary basis in a Uniformed Service under competent
authority and includes active duty, active duty for
training, initial active duty for training, inactive duty
training, full-time National Guard duty, a period for which
a person is absent from a position of employment for the
purpose of an examination to determine the fitness of the
person to perform such duty, and any other absence
qualifying as "service in the uniformed services" within the
meaning of USERRA. Notwithstanding the foregoing, Military
Leave does not include service in a Uniformed Service that
terminates as a result of separation of the Participant from
such Uniformed Service under other than honorable
conditions, as set forth in USERRA.
1.31 Monk-Austin Plan. The Monk-Austin Profit Sharing Plan.
1.32 Normal Retirement Age. The Participant's 65th birthday.
1.33 Normal Retirement Date. The first day of the month or after
the Participant's 65th birthday.
1.34 One-Year Break. A Plan Year during which the Participant
fails to earn at least 501 Hours of Service.
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1.35 Participant. An Employee participating in the Plan under
Plan section 2.1; provided that the term Participant is
sometimes used to include vested terminated and retired
Participants who have Account Balances. Where the context
indicates, the term Participant includes persons claiming
benefits accrued by a Participant.
1.36 Plan. The Dimon Incorporated Cash Balance Plan, as amended
from time to time and as set forth in this document, which
was named Retirement Plan for Employees of Dibrell Brothers
and Subsidiary Companies until the July 1, 1996, Effective
Date of this restatement.
1.37 Plan Administrator. The Committee is the Plan
Administrator.
1.38 Plan Year. The calendar year.
1.39 Qualified Domestic Relations Order. A judgment, decree,
order, or approval of a property settlement agreement
entered on or after January 1, 1985, that
(a) relates to the provision of child support, alimony
payments, or marital property rights to an Alternate
Payee;
(b) is made pursuant to a state domestic relations or
community property law;
(c) creates or recognizes the right of, or assigns the
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right to, an Alternate Payee to receive all or a
portion of the benefit payable with respect to the
Participant under this Plan;
(d) clearly specifies (1) the name and last known mailing
address (if available) of the Participant and the name
and mailing address of each Alternate Payee, unless the
Plan Administrator has reason to know the address
independently of the Order; (2) the amount or
percentage of the Participant's benefits to be paid by
the Plan to each Alternate Payee or the manner in which
such amount or percentage is to be determined; (3) the
number of payments or period to which the Order
applies; and (4) each plan to which the Order applies;
(e) does not require the Plan to provide any type or form
of benefit, or any option, not otherwise provided under
the Plan;
(f) does not require the Plan to provide increased benefits
(that is, does not provide for the payment of benefits
in excess of the actuarial equivalent of the benefits
to which the Participant would be entitled in the
absence of the Order); and
(g) does not require the payment of benefits to an
Alternate Payee that are required to be paid to another
Alternate Payee under another order determined
previously to be a Qualified Domestic Relations Order.
A domestic relations order entered before January 1, 1985,
is a Qualified Domestic Relations Order if payment of Plan
benefits pursuant to that order have begun by January 1,
1985, regardless of whether the order satisfies the
requirements of Code section 414(p), and even if payments
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have not begun by January 1, 1985, pursuant to such an
order, it may still be treated as a Qualified Domestic
Relations Order even though it does not satisfy the
requirements of Code section 414(p).
For purposes of this Plan section, Alternate Payee means a
Participant's Spouse, former Spouse, child, or other
dependent who is recognized by a Qualified Domestic
Relations Order as having a right to receive all or a
portion of the benefits payable under the Plan with respect
to the Participant.
1.40 Retirement Credit. The amount credited for each Plan Year
to the Cash Balance Account of each eligible Participant,
under the formula described in Plan section 3.1(b).
1.41 Retirement Credit Percentage. A percentage based on the sum
of the Participant's attained age and Years of Service
earned as of the applicable date, as set forth in the table
in Plan section 3.1(b).
1.42 Spouse or Surviving Spouse. The individual to whom the
Participant is legally married as of the earlier of his date
of death or his Benefit Commencement Date. To the extent
provided in a Qualified Domestic Relations Order, a former
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spouse will be treated as the Participant's Spouse or
Surviving Spouse for purposes of the survivor annuity
requirements.
1.43 Termination Date. The date the Employee ends his Employment
for any reason.
1.44 Trust (or Trust Fund). The fund maintained under the trust
agreement executed between the Company and the Trustee, as
amended from time to time, which is an integral part of this
Plan.
1.45 Trustee. Such individuals or entities as may be appointed
by the Board to hold the assets of the Trust Fund pursuant
to the terms of a trust agreement.
1.46 Uniformed Service. The Armed Forces; the Army National
Guard and the Air National Guard when engaged in active duty
for training, inactive duty training, or full-time National
Guard duty; the commissioned corps of the Public Health
Service; and any other category of persons designated by the
President of the United States in time of war or emergency.
1.47 USERRA. The Uniformed Services Employment and Reemployment
Rights Act of 1994.
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1.48 Years of Service. An Employee will be credited with one-
twelfth of a Year of Service for each calendar month during
which he is employed by an Employer. A period of employment
with an Employer begins on the date on which the Employee
commences employment (or the date on which he is reemployed)
with an Employer and ends on the date of this termination of
employment for any reason. The crediting of Years of
Service is subject to the following rules:
(a) Seasonal and Part-Time Employees. An Employee who is
scheduled to work fewer than five months per year or
fewer than 20 hours per week will be credited with a
Year of Service for each Plan Year in which the
Employee earns at least 1,000 Hours of Service.
(b) Service With a Controlled Group Member. Each Employee
will receive vesting and eligibility credit for Years
of Service for the period of his employment with any
Controlled Group member, whether or not it has adopted
the Plan, beginning on the later of the date he began
employment or the date the member became part of the
Controlled Group.
(c) Service Before an Employer Adopted the Plan. The
Committee will determine any Years of Service to be
credited for periods of employment with an Employer
before it adopted the Plan, to the extent credit is not
required under subsection (a).
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(d) Service with Monk-Austin. Each Employee will receive
vesting, and eligibility and benefit accrual credit for
Years of Service for the period of his service with
Monk-Austin before the Company acquired that Employer,
equal to the number of years of vesting credit he had
earned under the Monk-Austin Plan as of the acquisition
date.
(e) Employment Before a Five-Year Break. The nonvested
Participant who incurs a Five-Year Break will lose all
his credit for Years of Service earned before his Five-
Year Break. The vested Participant will retain all his
credit for Years of Service regardless of the number of
his One-Year Breaks.
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ARTICLE 2
ELIGIBILITY
2.1 Eligibility. Each Employee who participated in either the
Dibrell Plan or the Monk-Austin Plan as of June 30, 1996,
and each Employee who was hired between July 1 and December
31, 1995, will become a Participant in this Plan as of July
1, 1996, provided that he is an Employee as of that date.
Each other Employee will begin participating in the Plan as
of the first January 1 or July 1 after he has completed six
months of Employment and, in the case of an Employee who is
scheduled to work fewer than five months per year (a
"seasonal Employee") or fewer than 20 hours per week (a
"part-time Employee"), also completed 1,000 Hours of Service
during either an Employment anniversary year or a Plan Year.
If a seasonal Employee or a part-time Employee did not
complete 1,000 Hours of Service during his first six months
of Employment but did complete 1,000 Hours of Service during
his first 12 months of Employment or during his first
completed Plan Year, his participation will be retroactive
to the first January 1 or July 1 after he completed six
months of Employment. For purposes of eligibility,
Employees will receive credit for periods of service with
any Controlled Group member while it was in the Controlled
Group.
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2.2 Participation Upon Reemployment.
(a) Vested Participants. The vested terminated Participant
who resumes Employment at any time will resume
participation as of the date he resumes Employment and
will retain his pre-break Years of Service.
(b) Nonvested Participants.
(1) Before Five-Year Break. The nonvested terminated
Participant who resumes Employment before he
incurs a Five-Year Break will resume participation
as of the date he resumes Employment, and will
retain his pre-break Years of Service.
(2) After Five-Year Break. The nonvested terminated
Participant who resumes Employment after he has
incurred a Five-Year Break will not retain his
pre-break Years of Service and will be treated as
a new Employee under Plan section 2.1.
(c) Nonparticipating Employees.
(1) Before Five-Year Break. The nonparticipating
terminated Employee who resumes Employment before
he incurs a Five-Year Break will retain credit for
his Years of Service earned before his Termination
Date. If he met the eligibility requirements
under Plan section 2.1 as of his Termination Date,
he will begin participating as of the date he
resumes Employment. Otherwise, he will begin
participating as of the January 1 or July 1
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following the date when he has met the eligibility
requirements taking into account his pre-break
Employment.
(2) After Five-Year Break. The nonparticipating
terminated Employee who resumes Employment after
he has incurred a Five-Year Break will not receive
credit for his previous Employment for any purpose
under the Plan and will be treated as a new
Employee under Plan section 2.1.
(d) Reemployment Following Military Leave. A Participant
who is reemployed after an absence from employment due
to Military Leave and whose reemployment satisfies the
conditions required under USERRA shall be treated as
not having incurred a Break in Service as a result of a
period or periods of Military Leave.
2.3 Adoption of Plan by Controlled Group Member. A Controlled
Group member may adopt the Plan by appropriate action of its
board of directors or authorized officer(s) or
representatives(s), subject to approval by the Board.
2.4 Leased Employees. Leased Employees will be treated as
Employees to the extent required under Code section 414(n)
(6) (A), but will not be eligible to participate in this
Plan. However, if an individual who is a Leased Employee
becomes an Employee, he will receive credit for eligibility
to begin participating under Plan section 2.1 and credit for
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vesting under Plan section 3.2 for the period when he worked
as a Leased Employee, unless (a) the Leased Employee was
covered by a money purchase plan sponsored by the leasing
organization, with 10 percent contributions and immediate
participation and vesting, and (b) Leased Employees
constitute no more than 20 percent of the Controlled Group's
non-highly compensated employees (as defined in Code section
414(q)).
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ARTICLE 3
CASH BALANCE ACCOUNTS
3.1 Allocations to Cash Balance Account. A Cash Balance Account
will be established for each active and inactive Participant
to which the following amounts will be credited.
(a) Beginning Account Balance. As of July 1, 1996, a
Beginning Account Balance for each eligible Participant
will be credited in the following amount.
(1) Dibrell Plan Participants. Each Participant who
participated in the Dibrell Plan before July 1,
1996 will have a Beginning Account Balance in an
amount equal to the Actuarial Equivalent lump-sum
value (as defined in Plan section 1.4(b)) (as of
July 1, 1996) of his accrued benefit under the
Dibrell Plan calculated under the provisions of
that Plan as in effect on June 30, 1996.
(2) Monk-Austin Plan Participants. Each Participant
who participated in the Monk-Austin Plan will have
a Beginning Account Balance in an amount equal to
one year's Retirement Credits, calculated by
multiplying the Participant's Compensation earned
from July 1, 1995, through June 30, 1996, by his
Retirement Credit Percentage determined as of June
30, 1996.
(3) Certain New Hires. Each Participant whose
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Employment Date occurred between April 1, 1995,
and June 30, 1995, and who was excluded from
participation in the Dibrell Plan, will have a
Beginning Account Balance in an amount equal to
one-half year's Retirement Credits, calculated by
multiplying his Compensation earned from January
1, 1996 through June 30, 1996, by his Retirement
Credit Percentage determined as of June 30, 1996.
(b) Annual Retirement Credits. Each Participant will be
credited with Retirement Credits based on his full and
partial Years of Service determined as of his date of
termination pursuant to Plan section 1.48. In his
final year of Employment, the Participant who has met
the requirements for early retirement set forth in Plan
sections 1.16 and 4.1(b) will receive a Retirement
Credit based on his Compensation earned for the Plan
Year. For Plan Years beginning on or after January 1,
1996, the Cash Balance Account of each eligible
Participant will be credited with an amount calculated
by multiplying his Compensation for the Plan Year by
his Retirement Credit Percentage. Each Participant's
Retirement Credit Percentage is based on his attained
age and Years of Service earned as of the last day of
the Plan Year, or as of his Early Retirement Date if
applicable, as set forth below:
Total of Age and Retirement
Years of Service Credit Percentage
Less than 40 3.5%
40-49 4.0%
50-59 5.0%
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Total of Age and Retirement
Years of Service Credit Percentage
60-69 6.0%
70-79 7.0%
80 or more 8.0%
However, the Committee will credit the Beginning
Account Balances under subsection (a) by determining
the Retirement Credit Percentages as of June 30, 1996.
For the 1996 Plan Year, a Participant's Retirement
Credit will be calculated by multiplying his
Compensation earned from July 1, 1996, through December
31, 1996 (or his earlier Termination Date), by his
Retirement Credit Percentage determined as of December
31, 1996.
(c) Interest Credits. The Interest Credit Percentage for
each Plan Year as of first day of the Plan Year will be
based on the average rate paid on 12-month Treasury
Bills during the month of November in the preceding
Plan Year, plus one percent. Each active and inactive
Participant's Cash Balance Account will receive an
Interest Credit as of the last day of each Plan Year,
calculated by multiplying his Account Balance as of
that date (determined before crediting any Retirement
Credits for the Plan Year) by the Interest Credit
Percentage for that Plan Year. For the Participant
whose Benefit Commencement Date occurs on any date
during the Plan Year other than the last day of the
Plan Year, a pro-rated Interest Credit in an amount
equal to the product of the Account Balance as of that
date multiplied by the Interest Credit Percentage for
the Plan Year, and with that product multiplied by the
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ratio of whole months expired in the Plan Year over 12
will be credited to such Participant's Cash Balance
Account.
(d) Termination of Allocations. No Participant will be
credited with Retirement Credits or Interest Credits
after his Benefit Commencement Date.
(e) Statement of Account Balances. As soon as practicable
after the end of each Plan Year, the Committee will
provide to each Participant or Beneficiary (including
any Surviving Spouse or Alternate Payee) for whom a
Cash Balance Account is maintained, a statement showing
all credits to and debits from the Account, and the
current Account Balance. The Committee may provide
statements more frequently than annually, as it
considers appropriate.
3.2 Vesting. Each Participant who was fully vested in his
benefit under either the Dibrell Plan or the Monk-Austin
Plan as of July 1, 1996, the Effective Date of this amended
and restated Plan, will be fully vested in his Account
Balance under this Plan. Each other Participant will become
fully vested in his Account Balance as of the date he
completes five Years of Service, taking into account any
credit he may have under Plan section 1.41 for Employment
before the Effective Date of this amended and restated Plan.
3.3 Disability Benefit.
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(a) Continued Credits. The Participant who terminates
active Employment because of a Disability will continue
to be credited with Retirement Credits and Interest
Credits for each Plan Year that his Disability
continues, until the earlier of his recovery date, date
of death, Early Retirement Date if he elects to receive
or begin receiving his Account Balance prior to his
Normal Retirement Date, or his Normal Retirement Date.
His Retirement Credits for each Plan Year that his
Disability continues will be based on his Compensation
for the last full Plan Year of his active Employment,
and on his Retirement Credit Percentage determined
under Plan section 3.1(b) as of his last day of active
Employment. He will continue to receive credit for
Years of Service during his period of Disability for
purposes of vesting.
(b) Recovery. If the Disabled Participant recovers before
his Normal Retirement Date and submits a good-faith
application to resume active Employment within 30 days
after his recovery date, he will be entitled to the
Retirement Credits he earned during his period of
Disability even if his Employer fails to rehire him and
his recovery date will be his Termination Date. If the
Disabled Participant recovers and fails to submit a
good-faith application to resume active Employment
within 30 days after his recovery date, he will not be
entitled to Retirement Credits for the period of his
Disability, and his last day of active Employment will
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be his Termination Date. A Disabled Participant who
recovers before he has earned at least five Years of
Service will not be entitled to receive any benefit
under the Plan unless he resumes Employment and becomes
vested in his Account Balance.
(c) Payment Date. As soon as the Disabled Participant
reaches his Early Retirement Date, he may elect to
receive or begin receiving a benefit based on his
Account Balance as of his Early Retirement Date. If he
does not elect early payment, the Plan will pay, or
begin paying, his Account Balance as of his Normal
Retirement Date. He will not be credited with any
Retirement Credits or Interest Credits after his
Benefit Commencement Date.
3.4 Reemployment.
(a) Reemployment Before Receipt of Benefits. The Account
Balance of the Participant who terminates or retires
and resumes Employment before he receives any payment,
will be the sum of his Retirement Credits and Interest
Credits earned before and after his break in
Employment.
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(b) Reemployment After Receipt of Benefits.
(1) Lump Sum Payment. If a Participant terminates
active Employment for any reason, receives a cash-
out of his Accrued Benefit and then resumes
Employment, the Committee will take his pre-break
Years of Service into account in calculating his
Retirement Credit Percentage credited to him
following his reemployment for purposes of any
subsequent Retirement Credits to his Account
Balance. He will be fully vested in the credits
he receives after he resumes Employment.
(2) After Receipt of Monthly Payments. If a
Participant terminates or retires, receives
monthly annuity payments, and then resumes
Employment for at least 40 Hours of Service per
month, the Plan will suspend his payments and will
provide him the suspension-of-benefit notice
described in Plan section 4.1(c) within one month
after he resumes Employment. The Plan will resume
his payments as of his subsequent retirement date,
based on his Accrued Benefit as of that date minus
an amount equal to the Actuarial Equivalent value
of the annuity payments he previously received.
(c) USERRA Benefits. A Participant who is reemployed by an
Employer after a period of Military Leave and whose
reemployment satisfies the provisions of USERRA shall
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be entitled to Retirement Credits and Interest Credits
for each Plan Year while such Participant is on
Military Leave. For purposes of determining a
Participant's Accrued Benefit, such a Participant's
Compensation while on Military Leave shall be
determined as either (A) the Compensation the
Participant would have received during the period of
Military Leave had the Participant not incurred
Military Leave, determined based on the Compensation
the Participant would have received from the Employer
but for the absence during Military Leave, or (B) if
the Compensation the Participant would have received
during the period of Military Leave is not reasonably
certain, the Participant's average Compensation during
the 12-month period immediately preceding the Military
Leave (or, if shorter, the period of employment
immediately preceding the Military Leave).
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ARTICLE 4
PAYMENT ON ACCOUNT BALANCES
4.1 Payment Dates. Vested Account Balances will be paid as of
the following dates, in the form of payment that applies
under Plan section 4.2 or 4.4.
(a) Termination Before Retirement. Any Participant who is
vested in his Account Balance may terminate Employment
and elect to receive immediate payment of his Accrued
Benefit. The Participant whose Termination Date occurs
before he has met the requirements for early
retirement, set forth in subsection (b), may not elect
an annuity other than the automatic form annuity
described in Plan section 4.2. If the terminated
Participant does not elect earlier payment, his Accrued
Benefit will be paid on (or beginning on) his Normal
Retirement Date, under Plan section 4.2 or 4.4 as
applicable. However, if the present value of the
Participant's Accrued Benefit does not exceed $3,500,
he will receive a lump-sum payment equal to the present
value of his Accrued Benefit as soon as practicable
after his Termination Date.
(b) Early Retirement. The Participant whose Termination
Date occurs after he has both reached age 55 and
completed 10 Years of Service will be credited with a
Retirement Credit for the Plan Year in which his
Termination Date occurs, based on his Compensation for
the Plan Year. The Participant who has reached his
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Early Retirement Date and elects early payment may
elect either a lump sum or any annuity form described
in Plan section 4.2 or 4.4. However, if the present
value of the Participant's Accrued Benefit does not
exceed $3,500, he will receive a payment equal to the
present value of his Accrued Benefit as soon as
practicable after his Early Retirement Date. See
Addendum A for the early retirement provisions that
apply to the Beginning Account Balances of Participants
who participated in the Dibrell Plan before July 1,
1996.
(c) Normal Retirement. Each Participant's Normal
Retirement Age is his 65th birthday, and his Normal
Retirement Date is the first day of the month on or
after his 65th birthday, whether or not he actually
retires on that date. If he is not already vested, he
will become fully vested in his Cash Balance Account on
his 65th birthday. If the Participant has terminated
or retired and has not elected earlier payment, the
Plan will pay his Accrued Benefit either as an annuity
beginning as of his Normal Retirement Date, or as a
lump sum on that date, according to his election under
Plan section 4.2 or 4.4.
(d) Delayed Retirement. The Plan will suspend payment for
the Participant who continues Employment after his
Normal Retirement Date until the first day of the month
on or after the date when he actually retires. He will
continue to receive Retirement Credits and Interest
Credits under Plan section 3.1 until he retires. The
Committee will provide to each Participant who delays
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retirement, no later than one month after his Normal
Retirement Date, a written notice containing (1) a
statement that he will not receive any benefit payments
until he actually retires, but will receive an
Actuarial Equivalent increase in his Account Balance
for any month between his Normal Retirement Date and
his actual retirement date when he earns fewer than 40
Hours of Service, and for any month of active
Employment after the calendar year in which he reaches
age 70/ with an offset for the value of his continued
accruals; (2) an explanation that his benefit payments
are being suspended because he is continuing to earn
Compensation; (3) a general description of this
provision for delayed retirement and a photocopy of
this Plan section; (4) a statement that applicable
Department of Labor Regulations may be found in Section
2530.203-3 of the Code of Federal Regulations; and (5)
a statement that the Participant may seek review of his
benefit suspension by invoking the claims procedures
described in Plan section 10.8.
(e) Disability. The Disabled Participant may elect to
receive his Accrued Benefit at any time after he
reaches his Early Retirement Date. If he does not
elect earlier payment, he will receive payment on, or
beginning on, his Normal Retirement Date.
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4.2 Automatic Form of Payment.
(a) Five Years Certain and Life Annuity. The automatic
form of benefit payable to the unmarried Participant
will be the five years certain and life annuity
described in Plan section 4.4(a). The Participant may
elect any optional form described in Plan section 4.4.
(b) Qualified Joint and Survivor Annuity. The automatic
form of benefit payable to the married Participant will
be the Qualified Joint and Survivor Annuity, which is
the 50 percent joint and survivor annuity described in
Plan section 4.4(b) with the Participant's Spouse as
the contingent annuitant. After the death of the
Participant whose benefit was subject to the Code
section 415 limitation described in Plan section 6.1,
the Plan will calculate the amount payable to the
Surviving Spouse on the basis of the amount the
Participant would have received if his benefit had not
been subject to that limitation, but will not pay the
Surviving Spouse a benefit that exceeds 100 percent of
the amount the Participant had received. The
Participant may elect any optional form described in
Plan section 4.4 but only if he has his Spouse's
written consent obtained under the procedures described
in this Plan section. However, the Participant may
elect to receive the 75 percent or 100 percent joint
and survivor annuity with his Spouse as his contingent
annuitant, and he will not be required to have his
Spouse's consent to make the election. See Addendum A
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for Participants who terminated before August 23, 1984.
(c) Explanation of the Automatic Form Annuity.
(1) On his Information Date, a Participant will be
notified in writing by first class mail or
personal delivery of (A) a description of the
terms and conditions of the Joint and Survivor
Annuity, (B) the circumstances under which the
Qualified Joint and Survivor Annuity will be
effective, (C) the Participant's right to make,
and the effect of, a decision to revoke the
Qualified Joint and Survivor Annuity or the normal
form of benefit and elect an optional form of
benefit payment, (D) a general description of the
eligibility conditions and material features of
the optional forms of benefits under the Plan, (E)
the rights of a Participant's Spouse, if any,
under paragraph (2), (F) the Participant's right
to make, and the effect of, a revocation of any
election, (G) a general description of the
financial effect of selecting an optional form of
benefit payment and (H) sufficient additional
information explaining the relative values of the
optional forms of benefits under the Plan. After
his Information Date, a Participant must consent
in writing to a distribution pursuant to Plan
section 4.2 which begins on his Benefit
Commencement Date.
(2) Except as provided in the following sentences, a
Participant's Benefit Commencement Date is a date
that is at least 30 days and not more than 90 days
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after his Information Date. The period in which a
Participant may make an election or revocation
with respect to the form in which benefits may be
paid hereunder shall be made during the period
beginning with his Information Date and ending on
his Benefit Commencement Date. In no event,
however, shall a Participant have less than 30
days following the date the general information
regarding optional forms of benefit called for in
paragraph (1) above is delivered or mailed (first
class mail, postage prepaid) to him in which to
make his election. The preceding sentences to the
contrary notwithstanding, A Participant may
affirmatively elect to waive the minimum 30-day
period, provided that he (A) receives adequate
information describing his right to a 30-day
election period and (B) may revoke such
affirmative election under the later of his
Benefit Commencement Date or the expiration of the
seven-day period that begins with his Information
Date. A Participant whose Annuity Starting Date
is before his Information Date may not commence
distributions under the Plan until the expiration
of the seven-day period that begins with his
Information Date.
(3) If the Participant is married and if he elects or
has elected a form of payment other than a
Qualified Joint and Survivor Annuity, his election
of an optional form of benefit payment is not
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effective unless the Participant's Spouse consents
in writing to the election and to the specific
non-Spouse beneficiaries named in such election.
The election must designate a specific
beneficiary, including any class of beneficiaries,
which may not be changed without spousal consent
(or the Spouse expressly permits designations by
the Participant without further spousal consent).
The Spouse's consent must acknowledge the effect
of the Participant's election and must be
witnessed by a Plan representative or notary
public. A consent that permits designations by
the Participant without any requirement of further
consent by such Spouse must acknowledge that the
Spouse has the right to limit consent to a
specific beneficiary, and a specific form of
benefit, where applicable, and that the Spouse
voluntarily elects to relinquish either or both of
such rights. In addition, a Participant's waiver
of the Qualified Joint and Survivor Annuity shall
not be effective unless the election designates a
form of benefit which may not be changed without
spousal consent (or the Spouse expressly permits
designations by the Participant without any
further spousal consent). However, the consent of
a Spouse will not be required if the Participant
establishes to the satisfaction of the Plan
Administrator that such written consent cannot be
obtained because there is no Spouse or because the
Spouse cannot be located. Any consent under this
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subsection is valid only with respect to the
Spouse who signed the consent. Any evidence that
the consent of a Spouse cannot be obtained is
valid only with respect to that designated Spouse.
4.3 Election of Optional Form of Payment. Subject to the
restrictions described in section 4.2, the Participant who
is entitled to elect an optional form of payment may elect,
or revoke a previous election and make a new election,
within the 90-day period ending on his Benefit Commencement
Date, to receive his benefits in one of the forms described
in Plan section 4.4. Each election must be in writing on a
form prescribed by the Committee. The Participant may not
elect any option with a non-Spouse beneficiary unless the
present value of the payments expected to be made to the
Participant complies with the incidental death benefit rule
under Code section 401(a)(9)(G).
4.4 Description of Forms of Payment. The value of each of the
following annuity forms of payment will be the Actuarial
Equivalent of the Participant's Accrued Benefit, and each
form of annuity payment will be the Actuarial Equivalent of
the benefit that would be payable to the Participant as a
five years certain and life annuity.
(a) Single Life Annuity. The single life annuity is an
increased monthly benefit that begins on the
Participant's Benefit Commencement Date and is payable
throughout his lifetime, ending with the last payment
39
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due on the first day of the month in which his death
occurs.
(b) Joint and Survivor Annuity. The joint and survivor
annuity is a reduced monthly benefit beginning on the
Participant's Benefit Commencement Date and payable
throughout his lifetime, with either 50 percent, 75
percent or 100 percent of that monthly amount
continuing for life to his contingent annuitant,
beginning on the first day of the month following the
Participant's date of death.
(c) Five Years Certain and Life Annuity. The five years
certain and life annuity is an unreduced monthly
benefit beginning on the Participant's Benefit
Commencement Date and payable throughout his lifetime,
ending with the last payment due on the first day of
the month in which his death occurs; provided that if
the Participant dies within the five-year period
following his Benefit Commencement Date, payments will
continue to his beneficiary for the remainder of the
five-year period. If the beneficiary dies within the
five-year period and there is no surviving contingent
beneficiary, then the Actuarial Equivalent of any
remaining monthly payments will be paid in a lump sum
to the beneficiary's estate.
(d) Ten Years Certain and Life Annuity. The ten years
certain and life annuity is a reduced monthly benefit
beginning on the Participant's Benefit Commencement
Date and payable throughout his lifetime, ending with
the last payment due on the first day of the month in
which his death occurs; provided that if the
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Participant dies within the 10-year period following
his Benefit Commencement Date, payments will continue
to his beneficiary for the remainder of the 10-year
period. If the beneficiary dies within the 10-year
period and there is no surviving contingent
beneficiary, then the Actuarial Equivalent of any
remaining monthly payments will be paid in a lump sum
to the beneficiary's estate.
(e) Lump Sum Payment.
(1) Over $3,500. If the present value of the
terminated or retired Participant's Accrued
Benefit is greater than $3,500, he may elect to
receive a single sum payment, with Spousal consent
if he is married. The Plan will offer this form
of payment regardless of age, and will
simultaneously offer to the Participant or
Surviving Spouse (but not to any other
beneficiary) an immediate annuity in the automatic
form, or if the Participant has reached his Early
Retirement Date under the Plan, will offer all
annuity forms provided under the Plan.
(2) Not Over $3,500. If the present value of the
Participant's Accrued Benefit is not over $3,500,
the Committee will make a lump sum payment to him
as soon as practicable after his Termination Date.
(3) Nonvested Participant. Regardless of the present
value of his Accrued Benefit, the Committee will
41
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treat each nonvested Participant as having
received a constructive cash-out of his entire
Accrued Benefit as of his Termination Date, and if
he resumes Employment before he incurs a Five-Year
Break will treat him has having repaid his
constructive cash-out as of the date he resumes
Employment.
(4) Direct Rollover of Lump Sum Payments. The
Participant who receives a lump sum payment may
instruct the Committee to roll over all or part of
his lump sum payment to another qualified
retirement plan or to an individual retirement
account (IRA). The Participant must timely
provide in writing all information required to
effect the rollover. If the lump sum payment is
greater than $3,500, the Spouse's consent will be
required. A Surviving Spouse or Alternate Payee
under a Qualified Domestic Relations Order who
receives a lump sum payment may instruct the
Committee to roll over all or part of the payment
to an IRA, and must timely provide in writing all
information required to effect the rollover. The
Committee will provide timely notice of the right
to make a direct rollover. However, lump sum
payments less than $200, and minimum annual
amounts required to be paid under Plan section
4.6, will not be eligible for direct rollover.
4.5 Effect of Death on Forms of Payment.
(a) Death of Spouse or Beneficiary Before Benefit
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Commencement Date. If the Participant's benefit is
payable in any form with a survivor benefit and his
Spouse or designated beneficiary dies before his
Benefit Commencement Date, the survivor form of payment
will not become effective, and he will instead receive
his retirement benefit as a five years certain and life
annuity unless he properly elects another form before
his Benefit Commencement Date.
(b) Death of Participant Before Benefit Commencement Date.
If the Participant's benefit is payable in any form
with a survivor benefit and he dies before his Benefit
Commencement Date, his Spouse or other beneficiary will
not be entitled to any benefits under any such form.
His Surviving Spouse will be entitled only to the
preretirement death benefit payable under Article 5.
(c) Death of Spouse or Beneficiary After Benefit
Commencement Date. If the Participant's benefit has
begun in any form with a survivor benefit and his
Spouse or other beneficiary dies before he does, he
will continue to receive his benefit in the form
elected as of his Benefit Commencement Date.
(d) Death of Participant After Benefit Commencement Date.
If the Participant dies after his Benefit Commencement
Date, no death benefit will be payable except to the
extent provided under the form of benefit he was
receiving as of the date of his death.
4.6 Designation of Beneficiaries.
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(a) Procedure. Each Participant, with the written consent
of his Spouse if required under Plan section 4.2, may
designate one or more beneficiary(s) to receive any
benefits which may be payable in the event of his
death. The Participant may revoke or change his
designation from time to time by filing the proper form
with the Committee, and each change will revoke all his
prior designations. To be effective, each designation,
revocation or change must be made in writing on a form
provided by the Committee and must be signed and filed
with the Committee before the earlier of the
Participant's Benefit Commencement Date or date of
death; provided that the Participant who receives the
five-years or ten-years certain and life annuity may
change his beneficiary at any time before his death.
Unless the Spouse has executed a general consent under
Plan section 4.2(d), the married Participant must
obtain his Spouse's written consent each time he
changes his designation of beneficiary. The
Participant who elects a joint and survivor annuity
form of payment may designate only a single primary
beneficiary. The Participant who elects the five-years
or ten-years certain and life annuity may name one or
more primary beneficiaries and one or more contingent
beneficiaries, and must state the percentage payable to
each.
(b) Payment to Minor or Incompetent Beneficiaries. In the
event the deceased Participant's beneficiary is a
minor, or is legally incompetent, or cannot be located
after reasonable effort, the Committee will make
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payment to the court appointed guardian or
representative of such beneficiary, or to a trust
established for the benefit of such beneficiary, as
applicable.
(c) Judicial Determination. In the event the Committee
considers it necessary, it may have a court of
applicable jurisdiction determine to whom payments
should be made, in which event all expenses incurred in
obtaining the determination may be charged against the
payee.
4.7 Payment to Participant's Representative. If the Participant
is incompetent to handle his affairs on his Benefit
Commencement Date or thereafter, or cannot be located after
reasonable effort, the Committee will make payment(s) to his
court-appointed personal representative, or if none is
appointed the Committee may in its discretion make payments
to his next-of-kin; provided that the Committee may request
a court of competent jurisdiction to determine the payee, in
which event all expenses incurred in obtaining the
determination may be charged against the payee. Such
payments, to the extent made, shall be a complete discharge
of any liability for such payments under the Plan.
4.8 Unclaimed Benefits. In the event the Committee cannot
locate any person entitled to receive the Participant's
vested Accrued Benefit, with reasonable effort and after a
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period of five years, his Accrued Benefit will be forfeited
but will be reinstated within 60 days after he is located,
as required under Treasury Regulation section 1.401(a)-14(d)
or any other applicable law. The Committee will pay any
required retroactive payment in a single sum without any
adjustment for interest.
4.9 Required Distribution Rules. The required distribution
rules under Code section 401(a)(9) are set forth in Addendum
B.
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ARTICLE 5
PRERETIREMENT DEATH BENEFITS
5.1 Married Vested Participants. The Surviving Spouse of the
vested Participant who dies before his Benefit Commencement
Date will receive the qualified preretirement death benefit
described in this Plan section. See Addendum A for
Participants who terminated before August 23, 1984.
(a) Coverage for Surviving Spouse Only. The preretirement
death benefit coverage will become effective on the
later of (1) the date the Participant becomes vested,
or (2) the date he becomes married. The coverage will
remain in effect until the earlier of (1) the date the
Participant becomes unmarried for any reason, (2) the
Participant's date of death, or (3) the Participant's
Benefit Commencement Date. The coverage will remain in
effect whether or not the Participant continues in
Employment. The Plan will provide the death benefit
without any charge for the cost of coverage and without
reduction in the benefit payable to the Participant or
Surviving Spouse to account for the cost of coverage.
(b) Amount of Spouse's Preretirement Death Benefit. The
Surviving Spouse of the Participant who dies before his
Benefit Commencement Date will receive a survivor
benefit equal to the greater of (i) the Actuarial
Equivalent value equal to one-half the amount that
would have been payable to the Participant as a 50
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percent joint and survivor annuity as of his Normal
Retirement Date (determined without regard to the Code
section 415 limitations described in Plan section 6.1),
based on his Accrued Benefit as of his date of death or
(ii) the value of his Account Balance as of his date of
death. If the survivor benefit has a present value not
over $3,500, the Committee will pay the entire benefit
to the Surviving Spouse in a lump sum payment as soon
as practicable after the Participant's death, and will
not obtain the Spouse's consent to the payment. If the
Actuarial Equivalent present value is over $3,500, the
Surviving Spouse may elect to receive a lump sum
payment in an amount equal to the greater of the
present value of his Accrued Benefit or his Account
Balance, or to begin receiving annuity payments, as of
the first day of any month following the Participant's
date of death. If the Spouse does not elect earlier
payment, the Benefit Commencement Date for the survivor
benefit will be the Participant's Normal Retirement
Date. The Plan will make annuity payments as of the
first day of each month, with the last payment due on
the first day of the month in which the Spouse's death
occurs.
5.2 Unmarried Participant or Nonvested Participant. The
Participant who either does not have a Surviving Spouse, or
is not vested on his date of death, will not have any
preretirement death benefit coverage under the Plan.
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ARTICLE 6
LIMITATIONS ON BENEFIT AMOUNTS
6.1 Code Section 415 Limits. In no event will the annual
benefits payable to any Participant exceed the Code Section
415 Limit described in this Plan section.
(a) Applicable Definitions. For purposes of this Plan
section, the following terms will have the meanings set
forth below.
(1) Adjusted Accrued Benefit. The Participant's
Accrued Benefit after the adjustments described in
subsection (b), which is the amount to which the
Code Section 415 Limit will be applied.
(2) Code Section 415 Limit. For each Participant, the
lesser of:
(A) Dollar Limit. $90,000 (as indexed to the CPI
as of the first day of each Limitation Year
beginning in 1988), with the indexed limit
for each Limitation Year applied to benefits
in pay status.
(B) Percentage Limit. 100 percent of his average
Compensation as defined below for the three
consecutive calendar years when his
Compensation was highest.
(C) Other. Such other limitations as may be set
forth in Treasury Regulations from time to
time.
(3) Compensation. For purposes of his Code Section
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415 Limit, the Participant's Compensation includes
all amounts received from the Employer for his
performance of services and reported as taxable
income on his Form W-2, within the meaning of
Treasury Regulation section 1.415-2(d); and which
amount includes salary reduction amounts under
Code sections 125 and 401(k) effective January 1,
1988.
(4) Controlled Group. The Company and each member of
the group of corporations or entities connected
with the Company through common ownership of stock
having more than 50 percent of the total combined
voting power of all classes of stock entitled to
vote, or more than 50 percent of the total value
of shares of all classes of stock, within the
meaning of Code sections 414(b) and (c). For
purposes of the Code Section 415 Limit, all
Controlled Group members will be considered to be
a single Employer.
(5) Limitation Year. The Plan Year.
(6) Social Security Retirement Age. The age used as
the Participant's retirement age under Section
216(l) (4) of the Social Security Act. Each
Participant's Social Security Retirement Age will
be the following age which relates to his year of
birth:
Year of Birth Social Security Retirement Age
Before 1938 65 years
1938-1954 66 years
After 1954 67 years
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(b) Calculation of the Adjusted Accrued Benefit. Before
application of the Code Section 415 Limit, each
Participant's Accrued Benefit will be adjusted as
follows:
(1) Aggregation of Benefits. If the Participant has
participated in any other qualified defined
benefit plan maintained by an Employer, his
accrued benefit under each such plan will be
aggregated with his Accrued Benefit under this
Plan. If the Participant has participated in any
qualified defined contribution plan maintained by
an Employer, his Accrued Benefit will be subject
to the combined plan limits described in
subsection (d).
(2) Other Factors. The calculation of the
Participant's Adjusted Accrued Benefit will
include any other relevant provision in the Plan,
or requirement of law, in effect from time to
time.
(3) Adjusted Accrued Benefit. The product will be the
Participant's Adjusted Accrued Benefit for
purposes of applying the Code Section 415 Limit.
(c) Adjustments to the Code Section 415 Limits. The
Participant's Code Section 415 Limit, which will be
applied to reduce his Adjusted Accrued Benefit if
necessary, will be adjusted by any of the following
51
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circumstances which apply to him.
(1) Grandfathered Code Section 415 Limit. For
benefits the Participant accrued under any
qualified plan maintained by an Employer before
the 1987 Plan Year, his Code Section 415 Limit
will not be less than the following amount(s):
(A) Pre-1983 Accrued Benefit. If before 1983 the
Participant had participated in one or more
qualified defined benefit plans to which an
Employer contributed, his Code Section 415
Limit will not be reduced to an amount less
than his aggregate accrued benefit under such
plan(s) as of the last day of the 1982
limitation year under such plan(s).
(B) Pre-1987 Accrued Benefit. If before 1987 the
Participant had participated in one or more
qualified defined benefit plans to which an
Employer contributed, his Code Section 415
Limit will not be reduced to an amount less
than his aggregate accrued benefit under such
plan(s) as of the last day of the 1986
limitation year under such plan(s).
(2) Form of Payment. The Code Section 415 Limit
applies to benefits payable at the Participant's
Social Security Retirement Age in the form of the
single life annuity or the spousal 50 percent, 75
percent or 100 percent joint and survivor annuity.
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- -143-
If benefits are paid in any other form, the Code
Section 415 Limit will be reduced by the Actuarial
Equivalent factor for that form of payment, using
the greater of the interest rate used to calculate
forms of payment under Plan section 1.4, or five
percent.
(3) Reduced Limit for Early Retirement. If the
Participant begins benefit payments before his
Social Security Retirement Age, his Dollar Limit
will be reduced as follows:
(A) After Age 62. If the Participant's benefit
payments begin on or after the date he
reaches age 62 but before the date when he
reaches Social Security Retirement Age, the
Dollar Limit will be reduced by an amount
equal to 5/9 of one percent for each of the
first 36 months that his Benefit Commencement
Date precedes his Social Security Retirement
Age (6-2/3 percent per year), and 5/12 of one
percent for each additional month that his
Benefit Commencement Date precedes his Social
Security Retirement Age (five percent per
year).
(B) Before Age 62. If the Participant's benefit
payments begin before the date he reaches age
62, the Dollar Limit will be further reduced
by the lesser of the following factors: (i)
the ratio of the Plan's early retirement
53
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factor as of his Benefit Commencement Date,
over the Plan's early retirement factor at
age 62, or (ii) an Actuarial Equivalent
reduction from age 62 to his age as of his
Benefit Commencement Date, using the
applicable mortality table and a five percent
interest rate.
(4) Increased Limit for Late Retirement. The Plan
does not actuarially increase the benefits payable
to Participants who retire after they reach Social
Security Retirement Age until the first day of the
calendar year after the year in which the active
Participant reaches age 70/. Accordingly, the
Dollar Limit does not increase after Social
Security Retirement Age, except for the period of
active Employment beginning on the first day of
the calendar year after the year in which the
active Participant reaches age 70/. For that
period, the Dollar Limit will be increased by the
Actuarial Equivalent factors set forth in Plan
section 1.4(b).
(5) Reduced Limit for Fewer Than 10 Years of
Participation.
(A) Dollar Limit. The Dollar Limit for the
Participant who has fewer than 10 years of
participation in the Plan will be computed by
multiplying $90,000 (as adjusted) by a
fraction, the numerator of which is the
number of his whole and partial years of
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participation and the denominator of which is
10.
(B) Percentage Limit. The Percentage Limit for
the Participant who has earned fewer than 10
Years of Service will be computed by
multiplying the amount of his average
Compensation for his three highest years by a
fraction, the numerator of which is the
number of his whole and partial Years of
Service and the denominator of which is 10.
(6) Special Rules for an Adjusted Accrued Benefit Not
in Excess of $10.000. If the Participant's
Adjusted Accrued Benefit is not greater than
$10,000, the full amount may be paid whether or
not that amount exceeds his Percentage Limit, but
only if (A) his annual benefit has not exceeded
$10,000 in any previous Plan Year, and (B) he has
never participated in a defined contribution plan
maintained by an Employer. However, if the
Participant has fewer than 10 Years of Service,
then his Adjusted Accrued Benefit will be limited
by $10,000 multiplied by a fraction, the numerator
of which is the number of his whole and partial
Years of Service and the denominator of which is
10, and he will receive this reduced amount. If
he elects a form of payment other than the single
life annuity or spousal survivor annuity, his
Adjusted Accrued Benefit will not be reduced by
the Actuarial Equivalent factor for his elected
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form of payment.
(d) Combined Plan Limits. If an Employee is a Participant
at any time in both this Plan and any qualified defined
contribution plan maintained by the Employer, and the
sum of his Defined Benefit Fraction and his Defined
Contribution Fraction is greater than 1.0, his benefit
under this Plan will be reduced so that the sum of the
fractions does not exceed 1.0.
(1) Defined Benefit Fraction. The Participant's
Defined Benefit Fraction for any Plan Year is a
fraction, the numerator of which is his projected
annual benefit under this Plan determined as of
the last day of the Plan Year and the denominator
of which is the lesser of:
(A) 1.25 multiplied by $90,000 (as adjusted) and
the product multiplied by the ratio of the
Participant's Years of Service (not greater
than 10) over 10; or
(B) 1.4 multiplied by his average Compensation
for the three consecutive calendar years when
his Compensation was highest.
(2) Defined Contribution Fraction. Beginning in 1987,
the Annual Addition includes all amounts allocated
to the Participant's account(s) dollar-for-dollar,
but his Annual Additions for previous Plan Years
will not be recalculated to include amounts that
were excludable under Code section 415 as it
existed before 1987. The Participant's Defined
56
- -147-
Contribution Fraction for any Plan Year is a
fraction, the numerator of which is the sum of the
Annual Additions to his account(s) for the Plan
Year and all previous Plan Years during his
Employment, and the denominator of which is the
sum of the lesser of the following amounts for the
Plan Year and all previous Plan Years during his
Employment:
(A) 1.25 multiplied by $30,000 (as adjusted to
the CPI beginning as of the date when the
Dollar Limit is adjusted up to $120,000), or
(B) 1.4 multiplied by 25 percent of his
Compensation for the Plan Year.
Alternatively, the Committee may authorize the use
of any method permitted by Treasury Regulations
from time to time to compute the Defined
Contribution Fraction.
(3) Transition Rule for Computing the Defined
Contribution Fraction. To compute each
Participant's Defined Contribution Fraction for
Plan Years ending after 1982, the Committee may
authorize the use of a denominator for all Plan
Years ending before 1983, in an amount equal to
the product of (A) the amount of the denominator
for the Plan Year ending in 1982 under Code
section 415 as it then existed, multiplied by (B)
the transition fraction which is a fraction, the
numerator of which is the lesser of (i) $51,875,
or (ii) 1.4, multiplied by 25 percent of the
57
- -148-
Participant's Compensation for the Plan Year
ending in 1981, and the denominator of which is
the lesser of (i) $41,500, or (ii) 25 percent of
the Participant's Compensation for the Plan Year
ending in 1981.
(e) Combining of Plans. For purposes of applying the
limitations described in this Plan section, all defined
benefit plans maintained by any Employer (whether or
not terminated) will be treated as one defined benefit
plan, and all defined contribution plans maintained by
any Employer (whether or not terminated) will be
treated as one defined contribution plan; provided that
the Percentage Limit will be applied separately to each
defined benefit plan and will be applied under each
plan by using the same period of consecutive calendar
years (not more than three) as the period when the
Participant's Compensation was greatest.
(f) Compliance With Code section 415. The intent of this
Plan section is that the maximum benefit payable to
each Participant will be exactly equal to the maximum
amount permitted under Code section 415. If there is
any discrepancy between this Plan section and Code
section 415, then Code section 415 will prevail.
6.2 Restrictions on Benefits Payable to the 25 Highest-Paid
Participants.
(a) Restricted Participants. In each Plan Year, the total
number of Participants whose benefit payments are
restricted under this Plan section is limited to the 25
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highly compensated employees and former employees
(within the meaning of Code section 414(q)) with the
greatest Compensation in the current or any prior Plan
Year (the Restricted Participants).
(b) Restricted Amount. For each Plan Year, the amount of
benefits payable to each Restricted Participant will be
limited to the annual amount that would be payable in
the single life annuity form that is the Actuarial
Equivalent of the Participant's Accrued Benefit and, if
so, the Participant's other benefits (as described in
Treasury Regulation section 1.401(a)(4)-5(6)(3)(iii)),
unless either:
(1) the value of Plan assets remaining after payment
to the Restricted Participant is at least 110
percent of the value of current liabilities, or
(2) the value of benefits paid to the Restricted
Participant is less than one percent of the value
of current liabilities.
(c) Security for Restricted Amount. In lieu of the
restrictions described in this Plan section and to the
extent permitted by applicable law, the Plan may permit
each restricted Participant to provide security for any
payments which exceed the annual amount that would have
been payable as a single life annuity.
(d) Restriction Upon Plan Termination. In the event the
Plan terminates, the benefits payable to the restricted
Participants will be limited to an amount that is not
discriminatory under Code section 401(a)(4).
59
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6.3 Top-Heavy Rules.
(a) Applicable Definitions. For purposes of this Plan
section, the following terms will have the meanings set
forth below.
(1) Aggregation Group.
(A) Required Aggregation Group. Each of the
following qualified plans of the Controlled
Group is required to be aggregated for
purposes of determining top-heavy status: (i)
each plan in which a Key Employee is a
participant, and (ii) each other plan which
enables any plan with Key Employee
participants to meet the requirements of Code
section 401(a)(4) or 410.
(B) Permissive Aggregation Group. Qualified
plans of the Controlled Group which are
required to be aggregated, plus such plans
which are not part of the Required
Aggregation Group but which satisfy the
requirements of Code sections 401(a)(4) and
410 when considered together with the
Required Aggregation Group.
(2) Determination Date. For each Plan Year, the last
day of the preceding Plan Year.
(3) Key Employee. Any Employee or former Employee
covered under the Plan who is, or at any time
during the Plan Year in which occurs the
Determination Date or any of the four preceding
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Plan Years, has been either:
(A) one of the top 10 highest-paid owners of any
Employer or other Controlled Group member,
who both (i) owns more than a 1/2 percent
interest in value of the Employer or other
Controlled Group Member, and (ii) earns more
than $30,000 Compensation as indexed under
Code section 415(d),
(B) a five-percent owner of an Employer or other
Controlled Group member,
(C) a one-percent owner of an Employer or other
Controlled Group member having Compensation
of more than $150,000, or
(D) an officer (a high-level policy-making
executive) who received more than $45,000
Compensation as indexed under Code section
415(d), provided that the maximum number of
officers will be the lesser of (i) 50, or
(ii) the greater of three or 10 percent of
the total number of Employees.
(4) Non-Key Employee. An Employee who is not a Key
Employee.
(5) Top-Heavy Average Annual Compensation. The
Participant's average aggregate Compensation over
the five consecutive calendar years (or actual
number of consecutive years if fewer than five)
after 1983 during which his Compensation was
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highest, excluding any Compensation earned after
the last Plan Year in which the Plan is top-heavy.
(6) Top-Heavy Group. An Aggregation Group in which
the sum of (A) the present value of cumulative
Accrued Benefits for Key Employees under all
defined benefit plans included in the group, and
(B) the aggregate account balances of Key
Employees under all defined contribution plans
included in the group, exceeds 60 percent of a
similar sum determined for all Employees.
(b) Determination of Top-Heavy Status. The determination
of top-heavy status for any Plan Year will be based on
the actuarial valuation made as of the first day of the
Plan Year in which the Determination Date occurs. If
benefits under all the Controlled Group plans accrue at
the same rate, that accrual rate may be used; otherwise
the present value of all Accrued Benefits will be
determined by use of the fractional rule described in
Code section 411(b)(1)(C). The Plan will be treated as
top-heavy for the tested Plan Year under the following
rules:
(1) 60-Percent Rule. The Plan will be treated as top-
heavy if the Actuarial Equivalent of the
cumulative Accrued Benefits for Key Employees
exceeds 60 percent of the Actuarial Equivalent of
the cumulative Accrued Benefits for all Employees,
with the Actuarial Equivalent of Accrued Benefits
as determined under Code section 416(g).
(2) Top-Heavy Group Rule. The Plan will be treated as
62
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top-heavy if it is part of a Top-Heavy Group,
provided that the Plan will not be considered top-
heavy in any Plan Year in which the Plan is part
of a Required or Permissive Aggregation Group that
is not top-heavy.
(c) Plan Operation During Top-Heavy Status.
Notwithstanding any other provision of the Plan, the
following provisions will apply to Participants for any
Plan Year in which the Plan is top-heavy:
(1) Minimum Benefit. The Accrued Benefit of each
active Non-Key Employee Participant will not be
less than the lesser of (A) two percent of his
Top-Heavy Average Annual Compensation multiplied
by the number of his Years of Service, not in
excess of 10, during the Plan Years in which the
Plan is top-heavy; or (B) 20 percent of his Top-
Heavy Annual Compensation. The Participant will
accrue this minimum benefit for each of his Years
of Service earned while the Plan is top-heavy,
regardless of the level of his Compensation during
the Plan Year, or whether he remains in Employment
until the last day of the Plan Year. If the
Employee also participates in a defined
contribution plan maintained by an Employer, this
Plan will provide the top-heavy minimum benefit.
(2) Minimum Vesting. The Account Balance of each
Participant who earns any Hours of Service after
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the Plan becomes top-heavy will become vested
under the following schedule:
Years of Service Vested Percentage
Fewer than 2 0%
2 20%
3 40%
4 60%
5 80%
6 100%
(3) Effect on Aggregate Defined Benefit and Defined
Contribution Limits. For the purpose of
calculating the denominators of the Defined
Benefit Fraction and Defined Contribution Fraction
under Plan section 6.1(d), 1.0 will be substituted
for 1.25 each place it appears, and the dollar
amount $51,875 will be reduced to $41,500;
provided that such substitutions will not be
required if:
(A) the Actuarial Equivalent of the cumulative
Accrued Benefits for Key Employees does not
exceed 90 percent of the cumulative Accrued
Benefits for all Employees as determined
under Code section 416(g), and
(B) the minimum benefit described in subsection
(c)(1) is calculated by substituting three
percent for two percent, and 30 percent for
20 percent;
and provided further that such substitution will be
suspended for any Employee or former Employee so long
64
- -155-
as he receives no benefit accruals under this Plan or
any other qualified plan maintained by a Controlled
Group employer.
(d) Plan Operation After Change in Top-Heavy Status. If
the Plan is top-heavy in a Plan Year and ceases to be
top-heavy in a subsequent Plan Year, the following
provisions will apply:
(1) Accrued Benefit. The Participant's Accrued
Benefit in each subsequent Plan Year will not be
less than the minimum Accrued Benefit described in
Plan section 6.3(c)(1), computed as of the end of
the most recent Plan Year in which the Plan was
top-heavy.
(2) Vested Percentage. The Participant who became
partially vested under the schedule set forth in
Plan section 6.3(c)(2) before the end of the last
Plan Year in which the Plan was top-heavy, will
continue to have the vested percentage of his
Account Balance which he has as of that date but
will not have any additional vested percentage
until he has completed five Years of Service;
provided that the Participant who has completed at
least three Years of Service before the end of the
last Plan Year in which the Plan was top-heavy may
elect to continue to have the vested percentage of
his Account Balance determined under that vesting
schedule instead of the five-year cliff vesting
schedule described in Plan section 3.4(a)(2).
65
- -156-
(e) Cash-Out and Repayment. The Participant who becomes
partially vested under Plan section 6.3(c)(2),
terminates Employment and receives a cash-out of the
vested portion of his Account Balance under Plan
section 4.5 and then resumes Employment, will be
permitted to repay the amount of his cash-out plus
interest at the interest rate prescribed under by Code
section 411(a)(7)(C) as in effect on the date of his
repayment; provided that full repayment must be made no
later than the earlier of (1) the fifth anniversary of
the date he resumes Employment, or (2) the occurrence
of a Five-Year Break. After timely repayment of his
cash-out with all accrued interest, the Participant's
Years of Service accrued before and after his period of
absence will be aggregated.
66
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ARTICLE 7
CONTRIBUTIONS
7.1 Employer Contributions. The Employers will make
contributions in the amounts determined by the Committee to
be necessary to provide benefits under the Plan, based on
the recommendations of the Plan's actuary. Employer
contributions will be irrevocable and will be used only for
the benefit of Participants and beneficiaries, except as
provided in Plan sections 7.3 and 8.2.
The Company reserves the right to establish and to change
from time to time the method for funding benefits, either
through the use of one or more trust agreements or one or
more group annuity contracts or other forms of insurance
contracts.
7.2 Participant Contributions. Participants will neither be
required nor permitted to make contributions to the Plan.
7.3 Return of Contributions to the Employers. Contributions
will be returned to the affected Employer(s) under the
following circumstances:
(a) Mistake of Fact. Any contribution made by mistake of
fact will be returned to the affected Employer(s)
within one year after the contribution is made.
67
- -158-
(b) Nondeductible. All contributions are conditioned upon
their deductibility under Code section 404 and will be
returned to the affected Employer(s) within one year
after any disallowance.
7.4 Actuarial Gains. Forfeitures arising from any cause
whatsoever will not be applied to increase the benefits any
Participant would otherwise receive at any time before
termination of the Plan, but will be applied to reduce
Employer contributions for the current or subsequent Plan
Years.
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- -159-
ARTICLE 8
AMENDMENT, TERMINATION, MERGER
8.1 Amendment.
(a) Procedure. The Board shall have the right by action
documented in writing to modify, alter or amend the
Plan or the Trust Agreement in whole or in part by a
majority vote of its members at a meeting, by unanimous
consent in lieu of a meeting or in any other manner
permissible under applicable state law. In addition,
the Board may delegate to an appropriate officer, or
officers of Dimon Incorporated, or committee, all or
part of the authority to amend the Plan or the Trust
Agreement. The duties, powers and liabilities of the
Trustee hereunder shall not be increased without
written consent of the Board.
(b) Prohibited Amendments. No amendment will be permitted
which would have any of the following effects:
(1) Exclusive Benefit. No amendment will permit any
part of the Trust Fund to be used for purposes
other than the exclusive benefit of Participants.
(2) Nonreversion. No amendment will revest in any
Employer any portion of the Trust Fund except such
amount as may remain after termination of the Plan
and satisfaction of all liabilities.
69
- -160-
(3) No Cutback. No amendment will eliminate any
optional form of benefit described in Plan section
4.4 with respect to benefits accrued before the
amendment.
(4) Early Retirement Subsidy. No amendment will
eliminate or reduce any retirement subsidy or
retirement-type subsidy with respect to benefits
accrued before the amendment, for Participants who
either before or after the amendment meet the
requirements for the subsidy.
(c) Limited to Active Participants. Except as specifically
stated in the amendment, no amendment will apply to any
Employee whose Termination Date occurred before the
effective date of the amendment.
8.2 Termination of the Plan.
(a) Right to Terminate. While the Company expects to
continue the Plan indefinitely, the continuance of the
Plan is not assumed as a contractual obligation. The
Company reserves the right to discontinue its
contributions to the Plan and to terminate the Plan at
any time by action of its Board of Directors in
accordance with the procedures set forth in Plan
section 8.1(a).
(b) Full Vesting. In the event of termination or partial
termination, the Account Balance of each affected
Participant, to the extent funded, will become fully
vested as of the termination date. For purposes of
accelerated vesting, affected Participants will include
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only those who are in active Employment as of the Plan
termination date. All nonvested Participants who
terminated Employment before the Plan termination date
will be considered to have received constructive cash-
outs of their entire Account Balances under Plan
section 4.4.
(c) Provision for Benefits Upon Plan Termination. In the
event of termination, subject to Board approval the
Committee may in its discretion act as follows:
(1) Maintain the Trust. The Committee may continue
the Trust for so long as it considers advisable
and so long as permitted by law, either through
the existing trust agreement(s), or through
successor funding media.
(2) Terminate the Trust. The Committee may terminate
the Trust, pay all expenses, and direct the
payment of the benefits as allocated under
subsection (d), either in the form of lump-sum
distributions, installment payments, annuity
contracts, transfer to another qualified plan, or
any other form selected by the Committee, to the
extent not prohibited by law.
(d) Allocation of Assets. Upon termination, the Committee
will allocate the assets that remain after payment of
all Plan expenses, to Participants and to persons
claiming under Participants, as provided in ERISA
section 4044.
(e) Surplus Reversion. Any assets that remain after all
benefits under the Plan have been allocated will be
returned to the affected Employer(s).
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8.3 Merger. In the event of any merger or consolidation of the
Plan with any other plan, or the transfer of assets or
liabilities by the Plan to another plan, each Participant
will be entitled to receive a benefit immediately after the
merger, consolidation or transfer, if the Plan then
terminated, which is equal to or greater than the benefit he
would have been entitled to receive immediately before the
merger, consolidation, or transfer if the Plan had then
terminated.
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ARTICLE 9
APPOINTMENTS AND ALLOCATION OF FIDUCIARY RESPONSIBILITY
9.1 Named Fiduciary. Dimon Incorporated is hereby designated
and appointed the Named Fiduciary of the Plan.
9.2 Plan Administrator. Dimon Incorporated is hereby designated
and appointed Plan Administrator of the Plan.
9.3 Investment and Administrative Committee. The Board shall
appoint an Investment and Administrative Committee which
shall be comprised at least three persons and which shall
serve pursuant to the provisions of Article 11. The Board
shall have the power to remove a member of the Committee at
its discretion. In the event of a removal or if for any
other reason there are less than three members of the
Committee serving at any time, the Board shall as soon as
practicable appoint a new member or members so that there
shall be a minimum of three members.
9.4 Actuary. The Committee shall designate as actuary for the
Plan a person, actuarial firm or insurance company which
maintains on its staff at least one person recognized by the
Secretaries of Labor and Treasury as an enrolled actuary.
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Such entity shall be engaged by the Plan Administrator on
behalf of all Participants to perform valuations and provide
such actuarial certifications and render such other services
as may be necessary or desirable.
9.5 Accountant. To the extent required by law, the Committee
shall designate as accountant for the Plan a person or a
firm which maintains on its staff at least one person
recognized by the Secretaries of Labor and Treasury as an
independent qualified public accountant. Such entity shall
be engaged by the Plan Administrator to perform (to the
extent required by law) in accordance with generally
accepted accounting principles such examination of the
financial statements and other books and records of the Plan
as it deems necessary to enable it to form and render an
opinion as to whether the financial statements and schedules
required by law to be included in the annual report of the
Plan are presented fairly and in conformity with generally
accepted accounting principles applied on a basis consistent
with that of the preceding year and to render such other
opinions and perform such other services with regard to the
Plan as may be necessary or desirable.
9.6 Allocations of Fiduciary Responsibility. The Named
Fiduciary shall have the power to allocate fiduciary
responsibilities among other fiduciaries and to designate
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fiduciaries and nonfiduciaries to carry out fiduciary
responsibilities in order to provide for the orderly
operation and administration of the Plan. Any allocation,
delegation or other assignment of duties with regard to the
Plan previously made is hereby confirmed and shall continue
until such time as it is revoked, modified or altered by the
Named Fiduciary. The Named Fiduciary may permit any person
or entity to whom any authority or control has been granted
to further allocate, delegate or assign any or all such
duties to such other person or entity as the Named Fiduciary
may specify. To the extent allowed by law, each fiduciary's
responsibility is limited to the duties allocated as
designated thereto.
9.7 General.
(a) A person or entity serving as a fiduciary to the Plan
may employ one or more persons to render advice with
regard to his fiduciary responsibilities hereunder.
(b) If the fiduciary is serving as such without
compensation, reasonable expenses incurred by such
fiduciary may be reimbursed by the Company or, at the
discretion of the Company, from the Trust Fund.
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9.8 Fiduciary Discretion. In discharging the duties assigned to
it under the Plan, each fiduciary has the discretion to
interpret the Plan; adopt, amend and rescind rules and
regulations pertaining to their duties under the Plan; and
to make all other determinations necessary or advisable for
the discharge of their duties under the Plan. Each
fiduciaries' discretionary authority is absolute and
exclusive if exercised in a uniform and nondiscriminatory
manner with respect to similarly situated individuals. The
express grant in the Plan of any specific power to a
fiduciary with respect to any duty assigned to it under the
Plan must not be construed as limiting any power or
authority of the fiduciary to discharge its duties. A
fiduciary's decision is final and conclusive unless it is
established that the fiduciary's decision constituted an
abuse of its discretion.
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ARTICLE 10
PLAN ADMINISTRATION
10.1 General.
(a) The Plan Administrator shall be responsible for the
operation and administration of the Plan, except to the
extent its duties are allocated to or assumed by other
fiduciaries hereunder.
(b) The Plan Administrator shall establish rules and
procedures to be followed by the Participants,
beneficiaries and contingent annuitants in filing
applications for benefits and for furnishing and
verifying proofs necessary to establish age, Years of
Service, Hours of Service, Compensation and any other
matters required in order to establish their rights to
benefits under the terms of the Plan.
(c) The Plan Administrator shall supply such full and
timely information on all matters relating to the Plan
as (1) the Actuary, (2) the Accountant, (3) the
Committee and (4) the Trustee may require for the
effective discharge of their respective duties.
(d) It shall be the duty of the Plan Administrator to
handle the day-to-day operations of the Plan,
including: the enrollment of Participants; the
distribution of booklets, notices and other information
regarding the Plan; maintaining beneficiary designation
forms; explaining the optional forms of benefit payouts
which may be elected by a Participant under the Plan;
forwarding the option election forms executed by
Participants to the Trustee and communicating all other
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matters relating to participation and entitlement to
benefits to (1) the Actuary, (2) the Accountant, (3)
the Committee and (4) the Trustee as may be necessary
to enable them to discharge their duties under the
Plan. The Plan Administrator shall carry out these
duties in a uniform, equitable and nondiscriminatory
manner with regard to all Participants or beneficiaries
under similar circumstances.
10.2 Disclosure.
(a) The Plan Administrator shall see that descriptions of
the Plan are prepared for filing with the Department of
Labor and shall make available to Participants and
beneficiaries receiving benefits under the Plan a
summary of the Plan at such place and at such times as
may be required by Federal statutes and regulations
issued thereunder.
(b) The Plan Administrator shall arrange for the
preparation and filing of such annual reports,
including financial statements of the Plan's assets and
liabilities, schedules, receipts and disbursements and
changes in financial position in such form, at such
place and at such times as may be required by Federal
statutes and regulations. The Plan Administrator shall
furnish annually to all Participants and beneficiaries
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receiving benefits under the Plan a copy of a summary
of the financial statement of the Plan's assets and
liabilities and schedules of receipts and disbursements
and such other material as is necessary to fairly
summarize the latest annual report at such times as may
be required by Federal statutes and regulations.
(c) The Plan Administrator shall make available copies of
the Plan, copies of any contracts relating to the Plan,
descriptions of the Plan, and annual reports at its
principal office for examination by any Participant and
beneficiary receiving benefits under the Plan.
(d) Upon written request of any Participant or beneficiary
receiving benefits under the Plan, the Plan
Administrator shall furnish him a copy of the latest
updated summary Plan description, latest annual report
and a copy of the Plan. The Plan Administrator may
make a reasonable charge for the costs of furnishing
such copies.
10.3 Annual Accountings. To the extent required by law, the Plan
Administrator shall engage, on behalf of all Participants,
the independent qualified public accountant designated by
the Board, to certify and render an opinion that the
financial statements and schedules prepared in conjunction
with the Plan are presented fairly and are in conformity
with generally accepted accounting principles consistently
applied.
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10.4 Actuarial Services and Certification. The Plan
Administrator shall engage the Actuary designated by the
Committee to perform periodic actuarial valuations of the
Plan to determine the amount of contributions necessary to
maintain the Plan on an actuarially sound basis and in
compliance with the minimum funding standards in effect from
time to time. An actuarial valuation of the Plan shall be
made at least annually and annual certification of actuarial
soundness shall be made as required by law. The Plan
Administrator shall provide, or cause the Actuary to
provide, the Trustee with a copy of the results of each
actuarial valuation and annual actuarial certification. The
Committee shall approve, in consultation with the Actuary,
interest and mortality tables to be used to determine
Actuarial Equivalents under the Plan.
10.5 Funding Policy. The Committee in consultation with the
Actuary shall establish a funding policy and method to carry
out the objectives of the Plan. To formulate and maintain
such policy, the Committee and the Actuary shall consult at
least annually and more frequently, if necessary, to review
the short- and long-range financial needs of the Plan, the
anticipated level of annual contributions and any material
changes thereto occurring between actuarial valuations. The
results of such annual consultations shall be documented by
the Committee or its designee and circulated annually in
writing among the Committee and the Actuary.
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10.6 Expenses - Compensation. Although it is not required to do
so, it is Dimon Incorporated's present intention to pay the
reasonable expenses incurred in the administration of the
Plan. However, in its discretion and as permitted by ERISA,
Dimon Incorporated may direct that such expenses shall be
paid by the Trustee out of the Trust Fund. In no event,
however, shall any Employee of the Company be entitled to
compensation for his services with respect to the Plan other
than his normal compensation received as an Employee and the
reimbursement of his expenses incurred with respect to the
Plan.
10.7 Directions to Trustee. All directions from the Committee to
the Trustee shall be in writing from the Chairman of the
Committee or such other persons as may be appointed in
writing by the Committee. A Trustee shall rely on
directions from such persons and shall act in accordance
therewith, unless a Trustee knows or should know that the
directions constitute a breach of such person's or its own
obligations under the Plan.
10.8 Claims Procedure.
(a) All claims for benefits under the Plan shall be
submitted to the Plan Administrator or such person as
he may designate in writing, who shall have the initial
responsibility for determining the eligibility of any
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Participant or beneficiary for benefits. All claims
for benefits shall be made in writing and shall set
forth the facts which such Participant or beneficiary
believes to be sufficient to entitle him to the benefit
claimed. The Plan Administrator may adopt forms for
the submission of claims for benefits in which case all
claims for benefits shall be filed on such forms.
(b) On receipt of a claim, the Plan Administrator must
respond in writing within 90 days. If necessary, the
Plan Administrator's first notice must indicate any
special circumstances requiring an extension of time
for the Plan Administrator's decision. The extension
notice must indicate the date by which the Plan
Administrator expects to give a decision. An extension
of time for processing may not exceed 90 days after the
end of the initial 90 day period.
(c) In the event a claim for benefits is denied or if the
claimant has had no response to such claim within 60
days of its submission (in which case the claim for
benefits shall be deemed to have been denied), the
claimant or his duly authorized representative, at the
claimant's sole expense, may appeal the denial to the
Committee within 60 days of the receipt of written
notice of denial or 60 days from the date such claim is
deemed to be denied. In pursuing such appeal said
claimant or his duly authorized representative,
(1) may request in writing that the Committee review
the denial;
(2) may review pertinent documents; and
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- -173-
(3) may submit issues and comments in writing.
(d) The decision on review shall be made within 60 days or
within such longer time period as the claimant or his
representative may request, but not later than 120 days
after receipt of a request for review. The decision on
review shall be made in writing and shall include
specific reasons for the decision, written in a manner
calculated to be understood by the claimant and contain
specific references to the provisions of the Plan on
which such decision is based.
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ARTICLE 11
THE INVESTMENT AND ADMINISTRATIVE COMMITTEE
11.1 Committee. The Investment and Administrative Committee
shall consist of not less than three persons appointed by
the Board pursuant to Plan section 9.3. Any member of the
Committee may resign by giving notice in writing to the
Board at any time or may be removed at any time and for any
reason by the Board.
11.2 Meetings - Actions.
(a) Except as otherwise specifically provided herein, all
acts and decisions of the Committee shall be on the
concurrence of a majority of the members. Any decision
shall be evidenced in writing and signed by a majority
of the members.
(b) The Committee may delegate to any of its members or to
the secretary of the Committee authority to sign any
documents on its behalf, or to perform solely
ministerial acts, but such person shall not exercise
any discretion over matters delegated to him without
obtaining the concurrence of a majority of the members.
If at any time there shall be less than three members
of the Committee, the remaining member or members shall
have authority to act as the Committee. All acts and
determinations of the Committee shall be duly recorded
by the secretary thereof and all such records, together
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with such other documents as may be necessary, shall be
preserved by the secretary. Such records and documents
shall at all times be open for inspection and for the
purpose of making copies by any person designated by
Chesapeake Corporation. The Committee shall provide
such information as needed by (1) the Plan
Administrator, (2) the Actuary, (3) the Accountant, (4
the Trustee, and (5) other persons providing services
to the Plan for the effective discharge of their
duties.
11.3 Powers of Committee.
(a) The Committee shall have all duties specifically
allocated to it hereunder or which are delegated to it
by the Plan Administrator and shall have all necessary
powers to carry out these duties. The Committee shall
have the power to construe the Plan and to determine
all questions that arise hereunder. The Committee
shall be responsible for establishing a funding policy,
appointing and removing investment managers and
trustees, appointing, removing and contracting with
insurance companies and actuaries, establishing an
investment policy and reviewing investment performance.
In exercising its duties hereunder, the Committee
shall at all times act in a uniform, equitable and
nondiscriminatory manner in construing provisions of
the Plan as they relate to Participants and
beneficiaries in similar circumstances.
Notwithstanding its powers granted hereunder, the
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Committee shall have no power to modify in any way any
provision of the Plan.
(b) The Company shall indemnify and save harmless each and
all of the members of the Committee from the effects
and consequences of their acts, omissions and conduct
in their official capacity, except to the extent that
such effects and consequences shall result from their
own willful misconduct or gross negligence.
(c) A member of the Committee who is also a Participant of
the Plan shall abstain from any action which directly
affects him as a Participant. In the event of an
abstention, matters shall be decided by the remaining
members of the Committee. Nothing herein, however,
shall prevent any member of the Committee who is also a
Participant of the Plan or beneficiary from receiving
any benefit to which he may be entitled, so long as the
benefit is computed and paid on a basis that is
consistently applied to all other Participants and
beneficiaries.
11.4 Agents and Counsel. The Committee may engage agents to
assist it in its duties, and may consult with counsel, who
may be counsel for the Company, with respect to the meaning
or construction of this document and its obligations
hereunder, or with respect to any action, proceeding, or
question of law related thereto.
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- -177-
11.5 Compensation. The Company shall pay the reasonable expenses
incurred by the Committee in carrying out its duties and
responsibilities under the Plan, including reasonable legal
and accounting expenses. Should the Company fail to pay
these expenses, they shall be paid by the Trustee out of the
Fund. The Company agrees to supply such stenographic or
office help as may be necessary to assist the members of the
Committee in the performance of their duties and responsi-
bilities.
11.6 Officers. The Committee shall select a member to serve as
chairman of the Committee and the chairman may appoint a
secretary to keep such records as may be necessary of the
acts of the Committee. The secretary may, but need not, be
a member of the Committee. The secretary may perform any
and all purely ministerial acts which may be delegated to
him by the Committee.
11.7 Rules and Regulations. The Committee may formulate rules
and regulations not inconsistent with the purposes of the
Plan as it may deem necessary to enable it to carry out its
duties hereunder.
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- -178-
ARTICLE 12
MISCELLANEOUS
12.1 Headings. The headings and subheadings in this Plan have
been inserted for convenient reference, and to the extent
any heading or subheading conflicts with the text, the text
will govern.
12.2 Construction. The Plan will be construed in accordance with
the laws of the State of Virginia, except to the extent such
laws are preempted by ERISA and the Code.
12.3 Qualification for Continued Tax-Exempt Status.
Notwithstanding any other provision of the Plan, the spin-
off, amendment and restatement of the Plan is adopted on the
condition that it will be approved by the Internal Revenue
Service as meeting the requirements of the Code and ERISA
for tax-exempt status, and in the event continued
qualification is denied and cannot be obtained by revisions
satisfactory to the Committee, this amendment and
restatement will be null and void.
12.4 Nonalienation. No benefits payable under the Plan will be
subject to the claim or legal process of any creditor of any
Participant or beneficiary, and no Participant or
beneficiary will alienate, transfer, anticipate or assign
any benefits under the Plan, except that distributions will
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- -179-
be made pursuant to (a) Qualified Domestic Relations Orders,
(b) judgments resulting from federal tax assessments, and
(c) as otherwise required by law.
12.5 No Employment Rights. Participation in the Plan will not
give any Employee the right to be retained in the employ of
any Employer, or upon termination any right or interest in
the Plan except as provided in the Plan.
12.6 No Enlargement of Rights. No person will have any right to
or interest in any portion of the Plan except as
specifically provided in the Plan.
12.7 Single Employer Plan. All assets of the Plan will be
available to provide the benefits payable to all
Participants and beneficiaries.
12.8 Exclusive Purpose. This Plan has been created for the
exclusive purpose of providing benefits to Participants and
their beneficiaries and defraying reasonable expenses of
administering the Plan. The Plan shall be interpreted in a
manner consistent with applicable provisions of the Code and
of ERISA. Except as permitted by law, under no
circumstances shall any funds contributed to this Plan, any
assets of this Plan held under any Trust Agreement or income
attributable to such assets, revert to or be used or enjoyed
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- -180-
by an Employer, nor shall any such funds, assets or income
ever be used or diverted to purposes other than the
exclusive benefit of Participants or their beneficiaries.
12.9 Errors and Omissions. Individuals and entities charged with
the administration of the Plan must see that it is
administered in accordance with the terms of the Plan as
long as the Plan does not conflict with the Code or ERISA.
If an innocent error or omission is discovered in the Plan's
operation or administration, and the Plan Administrator
determines that it would cost more to correct the error than
is warranted, and if the Plan Administrator determines that
the error did not result in discrimination in operation or
cause a qualification or excise-tax problem, then, to the
extent that an adjustment will not, in the judgment of the
Plan Administrator, result in discrimination in operation,
the Plan Administrator may authorize any equitable
adjustment it deems necessary or desirable to correct the
error or omission, including but not limited to the
authorization of additional Employer contributions designed,
in a manner consistent with the goodwill intended to be
engendered by the Plan, to put Participants in the same
relative position they would have enjoyed if there had been
no error or omission. Any contribution made pursuant to
this section is an additional discretionary contribution.
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- -181-
IN WITNESS WHEREOF, Dimon Incorporated has caused the Dimon
Incorporated Cash Balance Plan to be executed by its duly
authorized officers this 7th day of February, 1997, to be
effective as of July 1, 1996.
DIMON INCORPORATED
By: John O. Hunnicutt
Title: VP of Administration/Secretary
ATTEST
Debra Slaughter
Corporate Seal:
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- -182-
DIMON INCORPORATED CASH BALANCE PLAN
ADDENDUM A
HISTORY OF REVISED PLAN PROVISIONS
The following are provisions which have been in effect during the
stated periods of the Plan's existence, but which may affect the
amount of or entitlement to benefits of a Participant, or
beneficiary of a Participant, whose Termination Date occurs after
the effective date of the 1996 amendment, restatement and
conversion to a cash balance plan.
ARTICLE I
DEFINITIONS
1.1 Accrued Benefit.
(a) Employee-Derived Accrued Benefit. The portion of
the Participant's Accrued Benefit derived from his
own Employee Contributions (as defined in Addendum A
section 1.5) is determined as follows:
(1) Termination Before Normal Retirement. As of
the date the Participant terminates Employment,
the Plan will calculate the value of his
Employee Contribution as accumulated with
interest under Addendum A section 1.5 through
his Termination Date, and project it to his
Normal Retirement Date by using (A) the PBGC
schedule of immediate and graded deferred
interest rates in effect on the first day of
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the Plan Year in which the Termination Date
occurs, and (B) no assumption for mortality.
The Plan will convert the projected Employee
Contribution to a single life annuity, using
the PBGC immediate interest rate in effect on
the first day of the Plan Year in which the
Termination Date occurs, and the Plan's
mortality assumptions for determining an
Actuarial Equivalent lump sum value as set
forth in Addendum A section 1.2.
(2) Termination On or After Normal Retirement. If
the Participant terminates his Employment on or
after his Normal Retirement Date, the Plan will
convert his Employee Contribution as
accumulated with interest under Addendum A
section 1.5 to his Termination Date, to a
single life annuity using the PBGC immediate
interest rate in effect on the first day of the
Plan Year in which his Termination Date occurs,
and the Plan's mortality assumptions for
determining an Actuarial Equivalent lump sum
value.
(b) Employer-Derived Accrued Benefit. The portion of
the Participant's Accrued Benefit derived from
Employer contributions is an amount equal to the
retirement benefit which he has earned under the
formula set forth in Plan section 3.1 in excess of
his Employee-Derived Accrued Benefit, based on his
Final Average Earnings and Covered Compensation as
of the date of determination. The Accrued Benefit
is calculated as if it will be paid on the
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Participants Normal Retirement Date in the form of a
single life annuity.
(c) Minimum Benefit. The Participant's total Accrued
Benefit will never be less than his Employee-Derived
Accrued Benefit.
1.2 Actuarial Equivalent. Before July 1, 1996, lump sum
values were computed on the basis of (a) the 1971 TPF&C
Forecast Mortality Table with a one-year setback for
Participants and a five-year setback for beneficiaries,
and (b) the PBGC schedule of immediate and graded
deferred rates in effect on the first day of the Plan
Year in which the lump sum was paid, and the five years
certain and life annuity was computed on the basis of the
annuity factors described in Plan section 1.4(a).
1.3 Break in Service. A Break in Service incurred by a
nonvested terminated Participant has always been governed
by the rule in effect as of his Termination Date. No
Participant has been entitled to have his vesting service
determined under a more generous Break in Service rule
which became effective after his Termination Date, unless
he resumed Employment before he incurred a Break in
Service under the old rule and earned at least one Hour
of Service after the effective date of the new rule.
(a) Before the 1976 Plan Year. A Break in Service will
be determined under the terms of the Plan prior to
the 1976 Plan Year.
(b) 1976 - 1984 Plan Years. A Break in Service was a
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period of consecutive whole One-Year Breaks equal to
or greater than the number of Years of Service the
nonvested terminated Participant had earned as of
his Termination Date.
(c) 1985 - 1988 Plan Years. A Break in Service was a
period of consecutive whole or partial One-Year
Breaks incurred by the nonvested terminated
Participant, which equaled or exceeded the greater
of five or the number of his whole and partial pre-
break Years of Service.
(d) After the 1988 Plan Year. A Break in Service is
five consecutive One-Year Breaks incurred by the
nonvested terminated Participant, regardless of the
number of his pre-break Years of Service.
1.4 Compensation.
(a) Statutory Cap. Before the 1994 Plan Year, each
Participant's Compensation taken into account for
all purposes under the Plan was limited to $200,000
(as indexed under Code section 401(a)(17)).
(b) Family Aggregation. For purposes of applying the
statutory cap for Plan Years 1989-1996, the Plan
will aggregate the Compensation of (1) each Employee
who either is a five-percent owner or is among the
10 highest-paid Employees, and (2) his Spouse and/or
his lineal descendants who have not reached age 19
as of the last day of the Plan Year. The Committee
will allocate the statutory cap among the members of
any Family Unit in proportion to each member's
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actual Compensation. The Plan will not prorate the
statutory cap on Compensation for any Participant
who participates in the Plan for less than a full
Plan Year.
1.5. Employee Contribution.
(a) Interest Accruals. The Participant's Employee
Contribution is the amount of the aggregate
contributions he made to the Plan through December
31, 1988, accumulated with interest at the rates of:
(1) the rate under the Plan in effect before 1976,
(2) 5 percent per annum for Plan Years 1976 - 1981,
(3) 8 percent per annum for Plan Years 1982 - 1987,
and
(4) a rate equal to 120 percent of the federal
midterm rate as in effect for January of each
year for Plan Year.
Interest is compounded annually from the date of
each contribution until the Termination Date. After
the Participants Termination Date, his Employee
Contribution will equal the Actuarial Equivalent
value of his Employee-Derived Accrued Benefit, as
defined above in Addendum A section 1.3(a), but
calculated by using no mortality assumption.
(b) Vesting. The Participant will be vested in 100
percent of his Employee Contribution at all times.
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(c) Ceased After 1988. After the 1988 Plan Year,
Participants are neither required nor permitted to
make any contribution to the Plan.
(d) Withdrawal. A vested Participant may not elect to
withdraw his Employee Contribution at any time.
(e) Repayment. The Participant who terminates
Employment and withdraws his Employee Contribution
and then resumes Employment before he incurs a Five-
Year Break, will be permitted to repay the amount of
his Employee Contribution plus interest at the rate
of five percent compounded annually for Plan Years
before 1988 and a rate equal to 120 percent of the
federal midterm rate as in effect for January of
each year in Plan Years beginning in 1988; provided
that full repayment must be made no later than the
earlier of (1) the fifth anniversary of the date he
resumes Employment, or (2) the fifth anniversary of
his withdrawal date. After timely repayment of his
Employee Contribution with all accrued interest, the
Participant's Employee-Derived Accrued Benefit will
be restored. The nonvested terminated Participant
who resumes Employment after he incurs a Five-Year
Break will not be permitted to repay his Employee
Contribution.
ARTICLE 2
RETIREMENT DATES AND BENEFITS
2.1 Accrued Benefits under the Dibrell Plan.
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(a) Early Retirement Benefit. Before July 1, 1996, the
Dibrell Plan's requirements for early retirement
were age 55 and 10 Years of Service. The Accrued
Benefit was reduced for early payment by an amount
equal to six percent for each of the first five
years, and four percent for each of the next five
years, by which the Participant's Benefit
Commencement Date preceded his Normal Retirement
Date. If a Participant retired after reaching age
62 and completing 40 Years of Service, his Accrued
Benefit was not reduced for early payment. These
early retirement factors will be applied to the
Beginning Account Balance of each Participant who
participated in the Dibrell Plan and who receives
payment under this Plan between his Early Retirement
Date and his Normal Retirement Date.
(b) Normal Retirement Benefit. Before July 1, 1996, the
Participant's normal retirement benefit was a
monthly benefit in an amount equal to 1/12 of 1.1
percent of his final average earnings multiplied by
his Years of Service. For this purpose, his final
average earnings was the annual average of his
Compensation for the five consecutive calendar years
(or actual number if fewer than five) during his
last 10 consecutive calendar years of Employment (or
actual number if fewer than 10) which produced the
highest average.
2.2 Vesting.
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(a) Before the 1976 Plan Year. The Participant who
terminated Employment before 1976, and was not
vested under the Plan as it existed on his
Termination Date, is not eligible to receive any
benefits under this Plan.
(b) 1976 - 1988 Plan Years. The Participant was vested
in 100 percent of his Accrued Benefit after he
completed 10 Years of Service or reached Normal
Retirement Age.
(c) After the 1988 Plan Year. The Participant will be
vested in 100 percent of his Accrued Benefit after
he completes five Years of Service or reaches Normal
Retirement Age.
ARTICLE 3
PAYMENT OF BENEFITS
3.1 Normal Form of Payment.
(a) Vested Participant Who Terminated Employment Before
August 23, 1984. Each vested Participant who earned
at least one Hour of Service after the 1975 Plan
Year but no Hours of Service on or after August 23,
1984, (the effective date of the Retirement Equity
Act) and who has a Spouse on his Benefit
Commencement Date, will receive his retirement
benefits in the form of the 50 percent joint and
survivor annuity with his Spouse as his joint
annuitant, unless he elects another form of payment.
The Participant will not be required to have his
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Spouse's consent to elect another form of payment.
(b) Vested Participant Who Terminated Employment Before
the 1976 Plan Year. Each vested Participant who
earned no Hours of Service after the 1975 Plan Year,
and whose Benefit Commencement Date occurs after the
1984 Plan Year, will receive his retirement benefits
in the form of the five years certain and life
annuity unless he elects another form of benefit.
The Participant will not be required to have his
Spouse's consent to receive any form of payment
available under the Plan.
3.2 Death Benefits - Married Vested Participant Who
Terminated Employment Before the Effective Date of the
Retirement Equity Act on August 23, 1984. The Plan will
provide the qualified preretirement death benefit
described in Plan section 5.1 to the Surviving Spouse of
each married active or terminated vested Participant who
dies on or after August 23, 1984 and before his Benefit
Commencement Date, including the Surviving Spouse of any
Participant who (1) earned at least one Hour of Service
after the 1975 Plan Year, (2) earned no Hours of Service
on or after August 23, 1984 but was alive and had not
begun receiving benefits as of that date, and (3) has at
least 10 Years of Service.
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DIMON INCORPORATED CASH BALANCE PLAN
ADDENDUM B
REQUIRED DISTRIBUTION RULES
1.1 Commencement of Benefits
(a) General Rules
(1) This Plan section is intended to describe the
requirements of the Code for the timing and
amount of benefits to be paid under the Plan if
a Participant is otherwise eligible for a
benefit. This Plan section does not entitle a
Participant to a benefit under the Plan.
(2) Subject to Plan sections 4.2 and 4.3, the
requirements of this Plan section shall apply
to any distribution of a Participant's interest
and will take precedence over any inconsistent
provisions of the Plan.
(3) All distributions required under Article 4
shall be determined and made in accordance with
Code section 401(a)(9) and regulations promul-
gated thereunder including the minimum
incidental death benefit rules of Proposed
Treasury Regulation section 1.401(a)(9)-2.
(4) The entire interest of a person must be or must
begin to be distributed not later than his
Required Beginning Date.
(b) Distribution Periods. As of the Participant's
Required Beginning Date, distributions, if not made
in a single-sum, may only be made over one of the
following periods (or a combination thereof):
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(1) the life of the Participant,
(2) the life of the Participant and a Beneficiary,
(3) a period certain not extending beyond the life
expectancy of the Participant, or
(4) a period certain not extending beyond the joint
and last survivor expectancy of the Participant
and a Beneficiary.
1.2. Death Distributions
(a) If the Participant dies after distribution of his
interest has begun, the remaining portion of such
interest will continue to be distributed at least as
rapidly as under the method of distribution being
used prior to the Participant's death.
(b) If the Participant dies before distribution of his
interest begins, distribution of the Participant's
entire interest shall be completed by December 31 of
the calendar year containing the fifth anniversary
of the Participant's death except to the extent that
an election is made to receive distributions in
accordance with (1) or (2) below:
(1) If any portion of the Participant's interest is
payable to a Beneficiary, distributions may be
made over the life or over a period certain not
greater than the life expectancy of the Benefi-
ciary commencing on or before December 31 of
the calendar year immediately following the
calendar year in which the Participant died.
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(2) If the Beneficiary is the Participant's
Surviving Spouse, the date distributions are
required to begin in accordance with (1) above
shall not be earlier than the later of (i)
December 31 of the calendar year immediately
following the calendar year in which the
Participant died and (ii) December 31 of the
calendar year in which the Participant would
have attained age seventy and one-half.
If the Participant has not made an election pursuant
to this paragraph by the time of his death, the
Participant's Beneficiary must elect the method of
distribution no later than the earlier of (i)
December 31 of the calendar year in which distribu-
tions would be required to begin under this Plan
section, or (ii) December 31 of the calendar year
which contains the fifth anniversary of the death of
the Participant. If the Participant has no Benefi-
ciary, or if the Beneficiary does not elect a method
of distribution, distribution of the Participant's
entire interest must be completed by December 31 of
the calendar year containing the fifth anniversary
of the Participant's death.
(c) For purposes of subsection (b)(2) above, if the
Surviving Spouse dies after the Participant, but
before payments to such Spouse begin, the provisions
of subsection (b)(2), with the exception of
paragraph (A), shall be applied as if the Surviving
Spouse were the Participant.
(d) For purposes of this subsection, any amount paid to
a child of the Participant will be treated as if it
had been paid to the Surviving Spouse if the amount
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becomes payable to the Surviving Spouse when the
child reaches the age of majority.
(e) For purposes of this subsection, distribution of a
Participant's interest is considered to begin on the
Participant's Required Beginning Date (or if
subsection (b)(3) above is applicable, the date
distribution is required to begin to the Surviving
Spouse pursuant to subsection (b)(2) above). If
distribution in the form of an annuity irrevocably
commences to the Participant before the Required
Beginning Date, the date distribution is considered
to begin is the date distribution actually
commences.
1.3. Required Beginning Date means the April 1st of the
calendar year next following the calendar year in which a
Participant attains age 70/. Effective January 1, 1997,
a Participant's distribution generally must be made or
commenced on or before April 1 of the calendar year
following the later of (a) the calendar year in which he
separate from service; or (b) the calendar year in which
he attains age 70/. Notwithstanding the preceding, the
entire interest of a Participant, who is a five-percent
owner (as defined in Code section 416(i)(1)), of any
Controlled Group Member must be made or commenced not
later than April 1 of the calendar year following the
calendar year in which he attains age 70 1/2.
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