Exhibit 10.13
BDM
401(k) SAVINGS PLAN
Effective Date: August 26, 1985
Amended and Restated Effective December 26, 1989
TABLE OF CONTENTS
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Section 1 - Definitions
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1.1 Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Adjustment Date . . . . . . . . . . . . . . . . . . . . . . . . 1
1.3 Beneficiary . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.4 Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.5 Code . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.6 Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.7 Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.8 Direct Transfer Account . . . . . . . . . . . . . . . . . . . . 2
1.9 Direct Transfer Contribution . . . . . . . . . . . . . . . . . . 2
1.10 Disability . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.11 Earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.12 Effective Date . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.13 Election Date . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.14 Employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.15 Employer . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.16 Employer Matching Contribution . . . . . . . . . . . . . . . . . 4
1.17 Employer Matching Contribution Account . . . . . . . . . . . . . 4
1.18 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.19 Hour of Service . . . . . . . . . . . . . . . . . . . . . . . . 4
1.20 Net Profit . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.21 Nondeductible Contribution Account . . . . . . . . . . . . . . . 6
1.22 Normal Retirement Age . . . . . . . . . . . . . . . . . . . . . 6
1.23 Participant . . . . . . . . . . . . . . . . . . . . . . . . . . 6
1.24 Period of Service . . . . . . . . . . . . . . . . . . . . . . . 6
1.25 Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.26 Plan Year . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.27 Retire or Retirement . . . . . . . . . . . . . . . . . . . . . . 7
1.28 Rollover Account . . . . . . . . . . . . . . . . . . . . . . . . 7
1.29 Rollover Contribution . . . . . . . . . . . . . . . . . . . . . 7
1.30 Salary Reduction Agreement . . . . . . . . . . . . . . . . . . . 7
1.31 Salary Reduction Contribution . . . . . . . . . . . . . . . . . 8
1.32 Salary Reduction Contribution Account . . . . . . . . . . . . . 8
1.33 Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
1.34 Trust or Trust Fund . . . . . . . . . . . . . . . . . . . . . . 8
1.35 Trust Agreement . . . . . . . . . . . . . . . . . . . . . . . . 8
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SECTION 2 - CONTRIBUTIONS TO THE TRUST AND ALLOCATION THEREOF
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2.1 Salary Reduction Contributions . . . . . . . . . . . . . . . . . . 9
2.2 Employer Matching Contributions . . . . . . . . . . . . . . . . . 12
2.3 Limitations on Salary Reduction Contributions and
Employer Matching Contributions . . . . . . . . . . . . . . . . 13
2.4 Limitations on Contributions . . . . . . . . . . . . . . . . . . 18
2.5 Limitations on Allocations . . . . . . . . . . . . . . . . . . . . 18
2.6 Nondeductible Voluntary Employee Contributions . . . . . . . . . . 23
SECTION 3 - RETIREMENT: TERMINATION OF SERVICE: DEATH
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3.1 Normal Retirement . . . . . . . . . . . . . . . . . . . . . . . . 25
3.2 Delayed Retirement . . . . . . . . . . . . . . . . . . . . . . . 25
3.3 Disability . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
3.4 Termination of Service . . . . . . . . . . . . . . . . . . . . . 25
3.5 Payment of Accounts . . . . . . . . . . . . . . . . . . . . . . . 26
3.6 Death . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
3.7 Continued Share in Profits or Losses of Trust Fund . . . . . . . 27
3.8 Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
3.9 Pretermination Distributions . . . . . . . . . . . . . . . . . . 30
SECTION 4 - VESTING
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4.1 Salary Reduction Contribution Accounts, Nondeductible Voluntary
Employee Contribution Accounts and Rollover Contribution Accounts 33
4.2 Employer Matching Contribution Accounts . . . . . . . . . . . . . 33
4.3 Restoration of Employer Matching Contribution Accounts . . . . . 33
SECTION 5 - ACCOUNTS; INVESTMENT FUNDS; ADJUSTMENT OF ACCOUNTS OF
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PARTICIPANTS
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5.1 Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
5.2 Investment Funds . . . . . . . . . . . . . . . . . . . . . . . . 34
5.3 Adjustments to Accounts . . . . . . . . . . . . . . . . . . . . . 36
5.4 Loan Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 6 - ADMINISTRATION BY COMMITTEE . . . . . . . . . . . . . . . . 38
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SECTION 7 - MANAGEMENT OF FUNDS AND AMENDMENT OF PLAN . . . . . . . . . 41
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SECTION 8 - ALLOCATION OF RESPONSIBILITIES AMONG NAMED FIDUCIARIES . . 43
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SECTION 9 - BENEFITS NOT ASSIGNABLE; FACILITY OF PAYMENTS . . . . . . 45
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SECTION 10 - BENEFICIARY . . . . . . . . . . . . . . . . . . . . . . . 46
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SECTION 11 - TERMINATION OF PLAN AND TRUST; REMOVAL OF TRUST; MERGER OR
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CONSOLIDATION OF PLAN
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11.1 Complete Termination . . . . . . . . . . . . . . . . . . . . . . 48
11.2 Partial Termination . . . . . . . . . . . . . . . . . . . . . . 48
11.3 Merger and Consolidation . . . . . . . . . . . . . . . . . . . . 48
SECTION 12 - COMMUNICATION TO PARTICIPANTS . . . . . . . . . . . . . . 49
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SECTION 13 - CLAIMS PROCEDURE
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13.1 Filing of a Claim for Benefits . . . . . . . . . . . . . . . . . 50
13.2 Notification to Claimant of Decision . . . . . . . . . . . . . . 50
13.3 Procedure for Review . . . . . . . . . . . . . . . . . . . . . . 51
13.4 Decision on Review . . . . . . . . . . . . . . . . . . . . . . . 51
13.5 Action by Authorized Representative of Claimant . . . . . . . . 52
SECTION 14 - PARTIES TO THE PLAN . . . . . . . . . . . . . . . . . . . 53
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SECTION 15 - SPECIAL TOP-HEAVY PROVISIONS
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15.1 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . 54
15.2 Determination of Top-Heavy Status . . . . . . . . . . . . . . . 60
15.3 Top-Heavy Requirements . . . . . . . . . . . . . . . . . . . . . 61
SECTION 16 - PORTABILITY OF PARTICIPANT ACCOUNTS . . . . . . . . . . . 65
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SECTION 17 - SPECIAL PROVISIONS RELATING TO TRANSFERS FROM
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QUALIFIED PLANS . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
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SECTION 18 - ROLLOVERS . . . . . . . . . . . . . . . . . . . . . . . . 68
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SECTION 19 - SPECIAL TRANSFER FROM RETIREMENT PLAN . . . . . . . . . . 70
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SECTION 20 - MISCELLANEOUS PROVISIONS
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20.1 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
20.2 Lost Distributees . . . . . . . . . . . . . . . . . . . . . . . 71
20.3 Reliance on Data . . . . . . . . . . . . . . . . . . . . . . . . 71
20.4 Bonding . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
20.5 Receipt and Release of Payments . . . . . . . . . . . . . . . . 72
20.6 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
20.7 Continuation of Employment . . . . . . . . . . . . . . . . . . . 72
20.8 Construction . . . . . . . . . . . . . . . . . . . . . . . . . . 72
BDM
401(k) SAVINGS PLAN
SECTION 1 - DEFINITIONS
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As used in the Plan, including this Section 1, and in the Trust Agreement
which is part of the Plan, references to one gender shall include the other
and, unless otherwise indicated by the context.
1.1 "Accounts" shall mean the separate accounts to be maintained by the
Committee with respect to each Participant as described in Section
5.1.
1.2 "Adjustment Date" shall mean for each Plan Year the 25th day of each
calendar month, commencing with September 25, 1985. The December 25
Adjustment Date shall be referred to herein as the "Year-End
Adjustment Date." Effective July 1, 1995, the Adjustment Date shall
be the first business day following receipt of an appropriate notice
requiring the valuation of a Participant's Account for any purpose.
1.3 "Beneficiary" shall mean the person, persons or entity designated or
determined pursuant to the provisions of Section 10 of the Plan.
1.4 "Board" shall mean the Board of Directors of BDM International, Inc.
1.5 "Code" shall mean the Internal Revenue Code of 1986 and rules and
regulations issued thereunder.
1.6 "Committee" shall mean the Committee on Employee Benefits of BDM
International, Inc.
1.7 "Compensation" shall mean the basic remuneration actually paid by the
Employer to an Employee during a Plan Year for Service, excluding any
pay for overtime service, bonuses, the cost of any group insurance and
hospitalization, disability or similar benefits, benefits under the
Plan, any amounts subject to a Salary Reduction Agreement or election
under Section 125 of the Code or any other payments or benefits not
customarily included in basic renumeration.
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1.8 "Direct Transfer Account" shall mean the separate account to be kept
for the Participant, as described in Sections 5 and 17, with respect
to amounts derived from the direct transfer by the trustee of another
qualified retirement plan to the Trustee under this Plan of assets
allocated to such Participant under such other qualified plan.
1.9 "Direct Transfer Contribution" shall mean the transfer of assets with
respect to a Participant as described in Section 17.
1.10 "Disability" shall mean, for purposes of the Plan, the inability, by
reason of any medically determinable physical or mental impairment
which can be expected to result in death or to continue for a period
of not less than six months, of the Participant to perform his regular
duties with the Employer or any other duties which the Employer is
willing to assign to him. The determination of the existence or
nonexistence of Disability shall be made by the Committee in a
nondiscriminatory manner pursuant to a medical examination by a
medical doctor selected or approved by the Committee.
1.11 "Earnings" shall mean a Participant's Compensation with respect to a
Plan Year, increased by the amount subject to any Salary Reduction
Agreement or election under Section 125 of the Code entered into by
the Participant for such year. Effective December 26, 1989, Earnings
shall not exceed the limitation provided under Section 401(a)(17) of
the Code for the calendar year in which the Plan Year begins. Such
annual limitation shall be adjusted from time to time as provided by
the Code.
1.12 "Effective Date of the Plan" shall be August 26, 1985.
1.13 "Election Date" shall mean the 26th day of March, June, September and
December of each calendar year, commencing with September 26, 1985.
Effective December 23, 1992, Election Date shall mean the 23rd day of
any calendar month. Effective July 1, 1995, Election Date shall mean
any business day of any calendar month.
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1.14 "Employee" shall mean, except as otherwise provided herein, an
individual in the service of the Employer if the relationship between
him and the Employer is the legal relationship of employer and
employee. In determining who is an Employee for the purposes of this
Plan, the following special provisions shall apply to the extent
applicable:
(a) Except for the purpose of applying the rules of Section 2.3, all
employees of all corporations which are members of a controlled
group of corporations (as defined in Section 414(b) of the Code)
which includes the Employer, and all employees of all trades or
businesses (whether or not incorporated) under common control (as
defined in Section 414(c) of the Code) which includes the
Employer, shall be treated as Employees of the Employer.
(b) All employees of all members of an affiliated service group (as
defined in Section 414(m) of the Code) which includes the
Employer shall be treated as Employees of the Employer.
(c) All leased employees shall be treated as Employees of the
Employer, but contributions or benefits provided by the leasing
organization which are attributable to services performed for the
Employer shall be treated as provided by the Employer. This
Section 1.14(c) shall not apply to any leased employee if such
employee is covered by a money purchase pension plan providing:
(i) a nonintegrated employer contribution rate of at least 7 1/2
percent of compensation, (ii) immediate participation, and (iii)
full and immediate vesting. For purposes hereof, the term "leased
employee" shall mean any person who, pursuant to an agreement
between the Employer and any other person (the "leasing
organization"), has performed services for the Employer (or for
the Employer and related persons determined in accordance with
Section 414(n)(6) of the Code) on a substantially full-time basis
for a period of at least one year and such services are of a type
historically performed by employees in the trade or business of
the Employer.
(d) Employees included in a unit of employees covered by a collective
bargaining agreement between employee representatives and the
Employer, if retirement benefits were the subject of good faith
bargaining between such employee
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representatives and the Employer, shall not be treated as
Employees of the Employer.
(e) Employees who are nonresident aliens and who receive no income
from the Employer which constitutes income from sources within
the United States shall not be treated as Employees of the
Employer.
See Section 1.23 for provisions governing eligibility of an Employee
to become a Participant in the Plan.
1.15 "Employer" shall mean BDM International, Inc., a corporation with its
principal office at McLean, Virginia, or any successor thereto by
merger, consolidation or otherwise, which may agree to continue this
Plan.
1.16 "Employer Matching Contribution" shall mean the amounts contributed to
the Plan by the Employer pursuant to the provisions of Section 2.2 of
the Plan.
1.17 "Employer Matching Contribution Account" shall mean the separate
account to be kept for each Participant as described in Sections 2.2
and 5 with respect to amounts derived from Employer Matching
Contributions.
1.18 "ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended (including amendments of the Internal Revenue Code
affected thereby), and rules and regulations issued thereunder.
1.19 "Hour of Service" shall mean:
(a) each hour for which an Employee is paid or entitled to payment by
the Employer for Service;
(b) each hour for which an Employee is paid or entitled to payment by
the Employer for reasons other than for Service (such as
vacation, holiday, illness, incapacity (including disability),
layoff, jury duty, military duty or leave of absence);
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(c) each hour (to the extent not included in (a) or (b)) for which
back pay (irrespective of mitigation of damages) has been either
awarded or agreed to by the Employer; and
(d) each hour for which an Employee is not actually in Service but is
required to be given credit for Service under any law of the
United States; provided, that in applying paragraph (b) for
periods in which an Employee is not actually in service, the
following special provisions shall apply:
(i) No hours shall be credited with respect to payments made
to the Employee for the purpose of complying with
applicable workmen's compensation, unemployment
compensation or disability insurance laws, or payments
solely to reimburse an Employee for medical or medically
related expenses incurred by the Employee; and
(ii) An amount paid to an Employee by the Employer indirectly,
such as by a trust, fund or insurer to which the Employer
makes contributions or pays premiums, shall be deemed to
be aid by the Employer.
An Employee shall be credited with Hours of Service on the basis of
the records of the Employer showing the hours for which payment is
made or due to the Employee. No more than 501 Hours of Service shall
be credited under (b) or (c) to an Employee on account of any single
continuous period during which an Employee performs no duties. The
provisions of this Section 1.19 shall be applied in accordance with
the provisions of United States Department of Labor Regulations
Sections 2530.200b-2(b)and (c), which provisions are incorporated
herein by reference.
1.20 "Net Profit" shall mean the net profit of the Employer for the Plan
year as determined according to generally accepted accounting
principles and practices by the accountant of the Employer, subject to
the following adjustments:
(a) gains or losses arising from the sale or other disposition of
fixed or capital assets of the Employer shall be excluded;
(b) taxes based upon income shall not be deducted; and
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(c) contributions of the Employer under this Plan or any other
defined contribution plan maintained by the Employer shall not
be deducted.
1.21 "Nondeductible Contribution Account" shall mean the separate account
to be kept for the Participant, as described in Sections 2.4 and 5,
with respect to amounts derived from his Nondeductible Voluntary
Contributions made prior to December 26, 1987.
1.22 "Normal Retirement Age" of a Participant shall be age sixty. The
"Normal Retirement Date" of a Participant shall mean the first day of
the calendar month coincident with or next following attainment of his
Normal Retirement Age.
1.23 "Participant" shall mean with respect to any Plan Year an Employee who
has entered the Plan and any former Employee who has an interest in
the Plan, except that an individual who is employed by an entity
described in Section 1.14(a) or 1.14(b), and which entity is not a
party to the Plan, or who is a leased employee described in Section
1.14(c), or who is not a regular full-time Employee, who is not a
regular part-time Employee, shall not be a Participant. For purposes
of this Section 1.23, a "regular full-time" Employee shall mean an
individual in the full-time employment of the Employer in an
established job requiring a minimum of forty Hours of Service per week
on a year-round basis. A "regular part-time" Employee shall mean an
individual in part-time employment of the Employer in an established
job requiring an average of 20 Hours of Service per week on a year-
round basis. An Employee shall enter the Plan and become a
Participant as of the date he shall complete his first Hour of Service
on or after the Effective Date of the Plan. If a Participant shall
terminate Service and shall reenter Service following such
termination, he shall automatically reenter the Plan as of the date he
shall reenter Service.
1.24 "Period of Service" shall mean the period of time from the date the
Employee first performs one Hour of Service to the date the Employee
quits, is discharged, retires, or dies, or the first anniversary of
the date the employee is absent from service for any other reason. An
Employee who is absent from work by reason of pregnancy, birth of a
child of the
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Employee, adoption of a child, or for purposes of caring for a child
following birth or adoption under an approved leave required by
federal law, including the Family Medical Leave Act of 1993, shall
have the period of leave added to service. A Period of Service shall
include any period of less than 12 months following the quit or
discharge of an Employee if the Employee is rehired before the end of
such 12-month period of absence. Periods of Service shall be
aggregated in accordance with the rules set forth in Section 1.410(a)-
7 of the Income Tax Regulations.
1.25 "Plan" shall mean the plan as herein set out or as duly amended.
1.26 "Plan Year" shall mean the 12 calendar month period commencing on
December 26 of each year and ending on the following December 25,
except for the first Plan year which commenced on August 26, 1985.
1.27 "Retire" or "Retirement" shall mean separation from Service (for
reasons other than death) under circumstances treated as Retirement
(including Disability Retirement) under the Plan.
1.28 "Rollover Account" shall mean the separate account to be kept for the
Participant, as described in Sections 5 and 18, with respect to
amounts derived from assets transferred by the Participant to this
Plan from another qualified retirement plan or individual retirement
account or annuity, which transfer satisfies the requirements of a
Rollover Contribution as described in Section 402(a) of the Code.
1.29 "Rollover Contribution" shall mean a rollover to the Plan by a
Participant as described in Section 18.
1.30 "Salary Reduction Agreement" shall mean a written agreement, entered
into by a Participant, pursuant to the provisions of Section 2.1(c)
of the Plan.
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1.31 "Salary Reduction Contributions" shall mean the amounts contributed to
the Plan by the Employer pursuant to the provisions of Section 2.1(b)
of the Plan.
1.32 "Salary Reduction Contribution Account" shall mean the separate
account to be kept for each Participant, as described in Sections 2.1
and 5, with respect to amounts derived from Salary Reduction
Contributions.
1.33 "Service" shall mean employment by the Employer as an Employee;
provided, that unless and to the extent the Board shall expressly
agree otherwise, service with a corporation or organization prior to
becoming a member of a controlled group, affiliated service group, or
trade or business under common control within the meaning of Sections
1.14(a) and 1.14(b) shall be disregarded for all purposes of this
Plan.
1.34 "Trust" or "Trust Fund" shall mean the Trust Fund held by the Trustee
under the Plan.
1.35 "Trust Agreement" shall mean the agreement between the Employer and
the Trustee which shall be a part of the Plan.
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SECTION 2 - CONTRIBUTIONS TO THE TRUST AND ALLOCATION THEREOF
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2.1 Salary Reduction Contributions:
(a) (i) Salary Reductions Before July 1, 1995: Each Participant,
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as of an Election Date coincident with or next following
the later of (i) the attainment of his twenty-first
birthday, or (ii) the completion of six Months of Service,
may elect by entering into a Salary Reduction Agreement
with the Employer to reduce his Earnings from the Employer
by a whole number percentage between two percent and
fifteen percent; provided, if such Participant is highly
compensated within the meaning of Section 2.3(a)(iv), he
may elect to reduce his earnings between two percent and
fifteen percent (or such lesser percentage as may be
determined by the Committee). Amounts subject to Salary
Reduction Agreements effective for a given Plan Year shall
be reduced proportionately to the extent that the Net
Profits of the Employer for such Plan Year and the
accumulated Net Profits for all preceding Plan Years are
not equal to the amounts subject to such Salary Reduction
Agreements. All amounts so reduced, adjusted for earnings,
gains and losses allocable thereto, shall be returned to
the Employer and immediately thereafter paid by the
Employer directly to the applicable Participants.
Effective December 23, 1991, a Participant or future
Participant shall become eligible to enter into a Salary
Reduction Agreement upon the attainment of his twenty-
first birthday.
(ii) Salary Reductions on or After July 1, 1995: Each
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Participant, as of an Election Date following the
attainment of his twenty-first birthday, may elect by
entering into a Salary Reduction Agreement with the
Employer to reduce his Earnings by a whole number percent
between one and fifteen. Such payment to or by the
Employer shall not be contingent upon the Net Profits of
the Employer. Provided, that a Highly Compensated
Employee's maximum deferral percentage (as defined in
Section 2.3(a)(iv)) may be limited to a lesser percent
effective for Plan Years beginning December 26,
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1994 and thereafter. The Committee shall have the
authority to adjust such maximum percentage for Highly
Compensated Employees.
(b) Salary Reduction Contributions: The Employer shall contribute
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to the trust for each Plan Year a Salary Reduction Contribution
in an amount equal to the total amount subject to Salary
Reduction Agreements for such year and not reduced pursuant to
Section 2.1(a). However, that no Participant shall be allowed
to contribute an amount in excess of the limit prescribed by
section 402(g) of the Code for any calendar year. Salary
Reduction Contributions shall be accumulated through payroll
deductions which shall be paid by the Employer to the Trustee
with reasonable promptness, and in any event, all Salary
Reduction Contributions with respect to Plan Year shall be paid
to the Trustee within thirty days after the end of such Plan
Year.
(c) Administrative rules governing Salary Reduction Agreements:
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(i) An election pursuant to Section 2.1(a) shall be made by
the Participant by executing and delivering to the
Employer a Salary Reduction Agreement at any time within
the period beginning at least ten days prior to the
Election Date as of when a Participant first becomes
eligible to enter into a Salary Reduction Agreement, or
any subsequent Election Date, and ending on such Election
Date (or, if such Election Date is not a regular business
day of the Employer, on the next following business day),
and shall continue in effect until the Participant shall
elect to discontinue Salary Reduction Contributions (as
described in (ii) below) or to change the percentage of
his Earnings allocable to Salary Reduction Contributions
(as described in (iii) below). Effective July 1, 1995, the
ten-day notice rule referred to above shall no longer be
applicable. Salary Reduction Agreement elections shall be
effectuated as soon as is practicable.
(ii) A Participant may revoke his Salary Reduction Agreement by
providing not less than ten days advance written notice to
the Employer, which revocation shall be effective as soon
as practicable following its receipt. In the event a
Participant revokes a Salary Reduction Agreement, he shall
be ineligible to
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elect for Salary Reduction Contributions to recommence
until a subsequent Election Date, commencing with the
first Election Date following the date of such revocation
by at least six months. The Employer may amend or revoke a
Salary Reduction Agreement with a Participant at any time
if the Employer determines that such amendment or
revocation is necessary to ensure that the annual
additions (as defined in Section 2.3(a)) to the Accounts
of a Participant do not exceed the maximum permissible
amount (as described in Section 2.3) for such Participant
for that Plan Year or to ensure that the requirements of
Section 2.1 (d) are met for such Plan Year. Effective
July 1, 1995, the ten-day notice rule referred to above
shall no longer be applicable and a Participant who
revokes a Salary Reduction Agreement shall be permitted to
execute a new Salary Reduction Agreement at any subsequent
Election Date without a six-month suspension period.
(iii) A Participant may amend his Salary Reduction Agreement by
providing not less than ten days advance written notice to
the Employer to increase or decrease the portion of such
Participant's Earnings which is subject to salary
reduction, within the percentage limits set forth in
Section 2.1(a). Any amendment to increase the portion of
the Participant's Earnings subject to salary reduction may
be made only as of a March 26, June 26, September 26, or
December 26 Election Date. Effective July 1, 1995, the
restriction limiting increases to the March 26, June 26,
September 26 and December 26 Election Dates is eliminated.
Any amendment to decrease the portion of the Participant's
Earnings subject to salary reduction may be made of any
Election Date.
-12-
(iv) The Employer shall establish a payroll deduction system or
other procedure to assist it in making Salary Reduction
Contributions, and the Committee may from time to time
adopt policies or rules governing the manner in which such
contributions may be made so that the Plan may be
conveniently administered.
(v) Notwithstanding anything to the contrary contained
elsewhere in the Plan, a Participant's Salary Reduction
Contribution Account shall not be distributable other than
upon:
(A) the Participant's Retirement, death, Disability or
separation from Service;
(B) the Participant's attainment of age 59 1/2; or
(C) hardship (as defined in Section 3.9).
(vi) Accounting - Each Participant's Salary Reduction
Contribution Account and Employer Contribution Account
shall be accounted for separately from the Participant's
other Accounts under the Plan.
(vii) Allocation to Salary Reduction Contribution Accounts -
Salary Reduction Contributions made by the Employer with
respect to a Plan Year shall be allocated as of each
Adjustment Date to the Salary Reduction Contribution
Account of a Participant in proportion by which such
Participant's Earnings from the Employer were reduced
pursuant to his Salary Reduction Agreement since the most
recent Adjustment Date.
2.2 Employer Matching Contributions
(a) Employer Match: Effective December 26, 1990, the Employer shall
--------------
provide a matching contribution with respect to a Participant's
Salary Reduction Contributions. The match will equal 25% of the
Participant's Salary Reduction Contributions with respect to the
first four percent of Earnings deferred. Amounts to be
contributed pursuant to this provision for a Plan Year shall be
reduced proportionately to the extent that Net Profits of the
Employer for such
-13-
Plan Year and the accumulated Net Profits for all preceding Plan
Years are not equal to the amounts to be contributed as Employer
Matching Contributions.
(b) Employer Matching Contributions: Employer Matching
-------------------------------
Contributions shall be accumulated and paid over to the Trustee
at the same time and in the same manner as Salary Reduction
Contributions.
(c) Administrative Rules: Employer Matching Contributions shall be
--------------------
adjusted, if necessary, in accordance with the Participant's
elections made with respect to Salary Reduction Contributions.
2.3 Limitations on Salary Reduction Contributions and Employer Matching
Contributions
(a) Limitations on Salary Reduction Contributions:
---------------------------------------------
(i) Notwithstanding anything to the contrary contained
elsewhere in the Plan or contained in any Salary Reduction
Agreement, all Salary Reduction Agreements entered into
with respect to any Plan Year shall be valid only if one
of the tests set forth in paragraph (ii) of this Section
2.3(a) is satisfied for such Plan Year.
(ii) For each Plan Year the actual deferral percentage for
eligible Participants who are highly compensated shall
bear to the actual deferral percentage for all other
eligible Participants a relationship that satisfies either
of the following tests:
(A) The actual deferral percentage for eligible
Participants who are highly compensated is not
more than the actual deferred percentage of all
other eligible Participants multiplied by 1.25; or
(B) The actual deferral percentage for eligible
Participants who are highly compensated is not
more than the actual deferral percentage for all
other eligible Participants multiplied by 2, and
the excess of the actual deferral percentage for
the group of eligible Participants who are highly
compensated over that of all other eligible
Participants is not more than two percentage
points.
-14-
(iii) If neither of the tests set forth in paragraph (ii) of this
Section 2.3(a) is satisfied after taking into account all Salary
Reduction Contributions for a Plan Year, then:
(A) Salary Reduction Agreements entered into for such year by
Participants who are highly compensated shall be valid
only to the extent permitted by either of the tests set
forth in paragraph (ii) above and Salary Reduction
Contributions made by the Employer for Participants who
are highly compensated shall be reduced to the extent
necessary to comply with either of the tests set forth in
paragraph (ii) of this Section 2.3(a). All amounts so
reduced shall be allocated to each applicable Participant
and such excess shall be returned to the Employer and
immediately thereafter paid by the Employer directly to
the Participant within 2 1/2 months after the end of the
Plan Year.
(B) Salary Reduction Agreements entered into by all
Participants who are not highly compensated shall be valid
and Salary Reduction Contributions made by the Employer
for such Participants shall not be changed.
(iv) Definitions: For purposes of this Section, the following words
-----------
and phrases shall have the meanings stated below:
(A) The actual deferral percentage for a specified group of
Participants for a Plan Year shall be the average of the
ratios, calculated separately for each Participant in such
group, of:
(I) the Salary Reduction Contribution, if any,
contributed by the Employer on behalf of each such
Participant for the Plan Year; to
(II) the Participant's Earnings for such Plan Year.
(B) An Employee is highly compensated if such Participant was
an Employee who during the Plan Year or preceding Plan
Year:
-15-
(I) was at any time a 5% owner,
(II) received compensation from the employer in excess of
$75,000,
(III) received compensation from the employer in excess of
$50,000 and was in the top-paid 20% of all Employees,
or
(b) Limitations on Employee Matching Contributions:
----------------------------------------------
(i) Notwithstanding anything to the contrary contained elsewhere
in the Plan, Employer Matching Contributions shall be valid
only if one of the tests set forth in paragraph (ii) of this
Section 2.3(b) is satisfied for such Plan Year.
(ii) For each Plan Year the actual contribution percentage for
eligible Participants who are highly compensated shall bear
to the actual contribution percentage for all other eligible
Participants a relationship that satisfies either of the
following tests:
(A) The actual contribution percentage for eligible
Participants who are highly compensated is not more
than the actual contribution percentage of all other
eligible Participants multiplied by 1.25; or
(B) The actual contribution percentage for eligible
Participants who are highly compensated is not more
than the actual contribution percentage for all other
eligible Participants multiplied by 2, and the excess
of the actual contribution percentage for the group of
eligible Participants who are highly compensated over
that of all other eligible Participants is not more
than two percentage points.
(iii) If neither of the tests set forth in paragraph (ii) of this
Section 2.3(b) is satisfied after taking into account all
Employer Matching Contributions for a Plan Year, then:
(A) Employer Matching Contributions for Participants who
are highly compensated shall be allowed only to the
extent permitted by either of the tests set forth in
paragraph (ii) above and Employer Matching
Contributions made by the Employer for Participants
who are highly compensated shall be reduced to the
extent necessary to comply with
-16-
either of the tests set forth in paragraph (ii) of
this Section 2.3(b). All amounts so reduced shall be
allocated to each applicable Participant and such
excess shall be returned to the employer and
immediately thereafter paid to the Participant within
2 1/2 months after the end of the Plan Year. However,
any Employer Matching Contribution reduced because of
the elimination of a Salary Reduction Contribution
pursuant to Sections 2.3(a) or 2.5 shall be forfeited
and used to reduce future Employer Matching
Contributions.
(B) Employer Matching Contributions for all Participants
who are not highly compensated shall not be changed.
(iv) Definitions: For purposes of this Section 2.3, the
-----------
following words and phrases shall have the meanings stated
below:
(A) The actual contribution percentage for a specified
group of Participants for a Plan Year shall be the
average of the ratios, calculated separately for each
Participant in such group, of:
(I) the Employer Matching Contribution, if any,
contributed by the Employer on behalf of each
such Participant for the Plan Year; to
(II) the Participant's Earnings for such Plan
Year.
(B) An Employee is highly compensated if such Participant
was an Employee who during the Plan Year or preceding
Plan Year:
(I) was at any time a 5% owner,
(II) received compensation from the employer in
excess of $75,000 (as adjusted under Section
414(q) of the Code),
(III) received compensation from the employer in
excess of $50,000 (as adjusted under Section
414(q) of the Code) and was in the top-paid
20% of all Employees, or
-17-
(IV) was at any time an officer and received
compensation greater than 50% of the amount
in effect for the year under Section
415(b)(1)(A) of the Code.
A Participant who is not a 5% owner and was not a highly
compensated employee under (II), (III), or (IV) above in the
preceding Plan Year shall be a Highly Compensated Employee in
the current Plan Year only if the Participant is among the 100
highest compensated employees. For purposes of this provision,
compensation shall be the Participant's W-2 compensation
increased by any Salary Reduction Agreement amounts or salary
reductions pursuant to section 125 of the Code.
(iii) A Participant is an eligible Participant if he is eligible to
enter into a Salary Reduction Agreement pursuant to Section
2.1(a).
(c) Multiple Use Restrictions: If both of the tests described in Section
-------------------------
2.3(a)(ii)(B) and Section 2.3(b)(ii)(B) are used in the same Plan Year
and the sum of the average actual deferral percentage and average
actual contribution percentage of the Participants who are highly
compensated exceeds the multiple use limit, first, the actual deferral
percentages and then, if necessary, the actual contribution percentage
of highly compensated participants shall be reduced beginning with the
highest actual deferral percentages and then the highest actual
contribution percentages until the multiple use limit is satisfied.
The multiple use limit is the greater of:
(i) 1.25 times the average deferral percentage for non-highly
compensated employees plus the lesser of the average
contribution percentage for non-highly compensated employees
plus 2% or multiplied by 2, or
(ii) 1.25 times the average contribution percentage for non-highly
compensated employees plus the lesser of the average deferral
percentage for non-highly compensated employees plus 2% or
multiplied by 2.
-18-
2.4 Limitations on Contributions
All Employer Salary Reduction Contributions and Employer Matching
Contributions for any Plan Year shall be made out of the Net Profits
of the Employer for such year or out of accumulated Net Profits for
preceding years; provided, that to the extent necessary to provide
the top-heavy minimum allocations described in Section 15, the
Employer shall make a contribution even if it exceeds current or
accumulated Net Profits or the amount which is deductible under
Section 404 of the Code. Notwithstanding anything to the contrary in
this Section 2, in no event shall the Employer contribute an amount
for any limitation year (as defined in Section 2.5) which would cause
the limitations in Section 2.5 to be exceeded. Except as otherwise
provided in this Section 2, each contribution to the Plan by the
Employer shall be made conditional upon being deductible under Section
404 of the Code and upon the Plan being qualified under Section 401
(a) of the Code for the Plan Year for which such contribution is made.
Effective July 1, 1995, the Net Profits requirement shall no longer
apply to Salary Reduction Contributions.
2.5 Limitations on Allocations
In administering the Plan, the following special provisions shall
apply:
(a) Subject to the provisions of Section 2.5(c), in no event shall
the sum of the annual additions to the Accounts of a
Participant for any limitation year under this Plan and under
any other defined contribution plan (as defined in Section
2.5(d) of the Employer in which the Participant participates
exceed in the aggregate the lesser of: (i) $30,000, referred
to herein as the "dollar limitation", or (ii) 25% of such
Participant's compensation received during the limitation
year, referred to herein as the "compensation limitation." For
limitation years beginning on and after January 1, 1988, the
amount of the dollar limitation shall be adjusted in
accordance with Treasury regulations to reflect increases in
the cost of living. In the event that the limitations provided
in this Section 2.5(a) would be exceeded for any limitation
year with respect to any Participant, any required reduction
in the annual addition to his Accounts shall be made with
respect to the annual addition to his Account under this Plan
as provided in Section 2.5(b).
-19-
(b) If, as a result of an error in estimating a Participant's
compensation, or other limited facts and circumstances, the
dollar limitation or the compensation limitation set forth in
Section 2.5(a) would be exceeded for any limitation year, such
excess with respect to a Participant for such limitation year
shall be disposed of in the following order:
(i) Any Nondeductible Employee Contributions (and any gains
attributable thereto) to the extent of such excess shall
be returned to the Participant.
(ii) If further reductions are necessary, then such
Participant's share of the Employer Salary Reduction
Contributions (or Employer Matching Contributions) for
the limitation year shall be reduced to the extent of
such remaining excess. The amount of the reduction shall
be reallocated among the remaining Participants in the
ratio which each of such Participant's compensation
during the limitation year in question bears to the
aggregate compensation of all such Participants during
such limitation year and before any Contributions such
limitation year are allocated. If all of the amount of
such reduction with respect to the Participant and the
amount of any reduction with respect to any other
Participant cannot be reallocated without causing the
Accounts of each other Participant to exceed the dollar
limitation or the compensation limitation, then such
amount shall be credited to a separate special account,
designated as the "Suspense Account."
(iii) The Suspense Account shall contain the excess amounts of
Contributions from all limitation years. Such excess
amounts shall be allocated for each succeeding limitation
year among the Salary Reduction Accounts and Employer
Matching Contribution Accounts of Participants in the
ratio which each of such Participant's compensation for
the limitation year in question bears to the aggregate
compensation of all such Participants during such
limitation year and before any Nondeductible Employee
Contributions, Salary Reduction Contributions, or
Employer Matching Contributions for such year are
allocated. The Suspense Account shall be adjusted
annually for additions thereto and distributions
therefrom. In the event the Plan is
-20-
terminated, any balance in the Suspense Account shall be
distributed to the Participants.
(c) In the event that an individual shall at any time be a
Participant in the Plan and in a defined benefit plan of the
Employer, in no event shall the sum of the defined benefit
fraction (as defined in this Section 2.5(c)) and the defined
contribution fraction (as defined in this Section 2.5(c)) for
any limitation year exceed 1.0. For purposes of this Section
2.5(c), and except as otherwise provided in this Section 2.5,
the defined benefit fraction for any limitation year of a
defined benefit Plan shall be a fraction, the numerator of which
is the projected annual benefit of the Participant under the
defined benefit Plan (as determined as of the close of such
limitation year), and the denominator of which is the lesser of
(i) the product of 1.25 and the dollar limitation in effect for
defined benefit Plans for such limitation year (referred to
herein as the "defined benefit dollar limitation"), and (ii) the
product of 1.4 and 100% of the Participant's average annual
Compensation for the period of three consecutive calendar years
(or the actual number of consecutive years of Service with the
Employer if the Participant was in Service with the Employer for
less than three consecutive years) which will produce the
highest average (referred to herein as the "defined benefit
compensation limitation"). The defined contribution fraction for
any limitation year of this Plan shall be a fraction, the
numerator of which is the sum of the annual additions to the
Participant's Accounts through the close of such limitation
year, and the denominator of which is the sum of the lesser of
(A) or (B) for such limitation year and for each prior
limitation year during which the Participant was an Employee of
the Employer (regardless of whether a Plan was in existence
during those years), where (A) is the product of 1.25 and the
dollar limitation and (B) is the product of 1.4 and the
compensation limitation for the limitation year. In the event the
limitation provided in this Section 2.5(c) would be exceeded for
any limitation year, the reduction in the sum of the defined
benefit fraction and the defined contribution fraction necessary
to comply with the limitation shall be made in the defined
contribution fraction and any reductions in
-21-
the annual addition to the Accounts of any Participant shall be
made in accordance with Section 2.5(a) and Section 2.5(b).
(d) For the purpose of applying the rules of this Section 2.5, the
following provisions shall apply:
(i) all defined benefit plans of the Employer shall be
considered as a single plan and all defined contribution
plans of the Employer shall be considered as a single
plan;
(ii) "defined contribution plan" shall mean a plan, including
this Plan, which provides for an individual account for
each Participant and for benefits based solely on the
amount contributed to the Participant's account and any
income, expenses, gains and losses, and any forfeitures
of accounts of other Participants, which may be allocated
to such Participant's account; and "Defined Benefit Plan"
shall mean any plan which is not a defined contribution
plan; provided, that there shall be included within the
definition of a defined contribution plan or a defined
benefit plan, as the case may be, only plans which are
described in Section 415(k)(1) of the Code;
(iii) all corporations in a controlled group of corporations
with the Employer (within the meaning of Section 414(b)
of the Code as modified by Section 415(h) of the Code),
all trades or businesses (whether or not incorporated)
under common control with the Employer (within the
meaning of Section 414(c) of the Code as modified by
Section 415(h) of the Code) and all members of an
affiliated service group with the Employer (within the
meaning of Section 414(m) of the Code) shall be
considered to be the Employer;
(iv) "projected annual benefit" shall mean the annual normal
retirement benefit payable in the form of a straight life
annuity (with no ancillary benefits) to which a
Participant would be entitled under the terms of the
defined benefit plan if the following factors are
assumed:
(A) the Participant will continue employment with the
Employer until he reaches normal retirement age
under the defined benefit plan (or
-22 -
until his then current age, if he has previously
reached such normal retirement age),
(B) the Participant's compensation for the limitation
year will remain the same until the date the
Participant attains normal retirement age under
the defined benefit plan, and
(C) all other relevant factors used to determine
benefits under the defined benefit plan for the
limitation year will remain constant for all future
limitation years;
(v) the "limitation year" shall be the Plan Year;
(vi) "compensation" shall mean for any Participant the wages,
salary, and other amounts paid or accrued with respect to
such Participant by the Employer during the limitation
year for personal services actually rendered by the
Participant in the course of his service with the Employer
(including, but not limited to, commissions, compensation
for services on the basis of a percentage of profits, and
bonuses) and excluding contributions made by the Employer
to any plan of deferred compensation, amounts realized
from the exercise of a nonqualified stock option or from
the sale or other disposition of stock acquired by the
exercise of an incentive stock option, and any other
amount paid by the Employer which receives special tax
benefits; and
(vii) the "annual addition" with respect to any limitation year
shall mean the sum of the following items allocated on
behalf of a Participant (A) Employer contributions
(including Salary Reduction Contributions made pursuant to
Section 2.1); (B) all forfeitures; (C) for contributions
made prior to December 26, 1987, the lesser of (1) the
amount of the Participant's Nondeductible Employee
Contributions in excess of six percent of such
Participant's compensation for the limitation year, and
(2) one-half of such Participant's Nondeductible Employee
Contribution (Nondeductible Employee Contributions shall
be considered made with respect to a particular Plan Year
if such contributions are actually made by the Participant
during such Plan Year or within thirty days after the
close of
-23-
such Plan Year) and all of the Participant's Non-
deductible Employee Contributions made after December 25,
1987; (D) amounts allocated, after March 31, 1984, to an
individual medical account, as defined in Section 415(l)
of the Code, which is part of a defined benefit plan
maintained by the Employer; and (E) amounts derived from
contributions paid or accrued after December 31, 1985, in
taxable years ending after such date, which are
attributable to post-retirement medical benefits allocated
to the separate account of a key employee, as defined in
Section 419(A)(d) of the Code, under a welfare benefit
fund, as defined in Section 419(e) of the Code, maintained
by the Employer. Provided, that the following are not
"annual additions": (A) transfers of funds from one
qualified Plan to another, (B) Rollover Contributions (as
defined in Sections 402(a)(5), 403(a)(4), 408(d)(3) and
409(b)(3)(C) of the Code, (C) repayments of loans made to
a Participant from the Plan, (D) repayments of
distributions received by an Employee pursuant to Section
411(a)(7)(B) of the Code, (E) repayments of distributions
received by an Employee pursuant to Section 411(a)(3)(D)
of the Code (mandatory contributions), (F) Employee
contributions to a simplified employee pension allowed as
a deduction under Section 219(a) of the Code, and (G)
deductible Employee contributions to a qualified plan.
2.6 Nondeductible Voluntary Employee Contributions
No Nondeductible Employee Contributions shall be made or accepted by
the Plan effective December 26, 1987. Nondeductible Voluntary
Contributions made prior to December 26, 1987 by a Participant, and
all amounts stemming therefrom, shall be allocated to his
Nondeductible Employee Contribution Account. Assets of the
Nondeductible Contribution Accounts may be mingled for investment with
other funds of the Trust. A Participant having an amount in his
Nondeductible Contribution Account may, by giving at least ten days
(no longer required, effective July 1, 1995) written notice to the
Committee, withdraw all or a designated portion of the amount then in
his Nondeductible Contribution Account. Such withdrawal shall be paid
to the Participant as soon as practicable. To the extent not
-24-
inconsistent with the provisions of this Section 2.4, the Committee
may promulgate rules or by-laws supplementing and implementing the
provisions of this Section 2.4.
-25-
SECTION 3 - RETIREMENT; TERMINATION OF SERVICE; DEATH
-----------------------------------------------------
3.1 Normal Retirement
A Participant who is in Service shall be eligible to retire from
Service at his Normal Retirement Date.
3.2 Delayed Retirement
If a Participant shall remain in Service following his Normal
Retirement Date, his Retirement date shall be the date he shall
actually terminate Service for reasons other than death. During the
period that such Participant remains in Service pursuant to this
Section 3.2, he shall continue to be a Participant for and including
each Plan Year in which he meets the requirements therefor. If an
Employee not otherwise a Participant becomes eligible to enter the
Plan following his Normal Retirement Date, the provisions of this
Section 3.2 shall apply in determining his Retirement date.
3.3 Disability
If a Participant shall suffer Disability while in Service prior to his
Normal Retirement Date, he may retire as of the date of establishment
of his Disability and the balance in his Account may be payable as
provided in Section 3.5, treating for this purpose the date of his
Disability Retirement as if it were his Normal Retirement Date.
3.4 Termination of Service
A Participant who has terminated Service and who is not eligible to
retire under the Plan on the date of his termination, and whose vested
balance in his Accounts as of the Adjustment Date coincident with or
next following his termination (the "Termination Adjustment Date") is
less than or equal to $3,500, shall be paid such balance in a lump sum
as soon as practicable following his Termination Adjustment Date. A
Participant who has terminated Service and who is not eligible to
retire under the Plan on the date of his termination, and whose vested
balance in his Accounts as of the Termination Adjustment Date exceeds
$3,500, may elect to be paid such balance in a lump sum as soon as
practicable following
-26-
his Termination Adjustment Date. Such election shall be submitted in
writing on or before the Termination Adjustment Date and shall be
irrevocable on such date. If such Participant shall fail to submit
such election, the balance in his Accounts shall be held under the
Plan, and adjusted as of each Adjustment Date pursuant to Section 3.7,
until the earlier of his Normal Retirement Date or death, whereupon
such balance, as adjusted, shall be paid to him or his Beneficiary, as
the case may be, in the same manner as if he were in Service at the
time of his Normal Retirement Date or death. Notwithstanding the
foregoing provisions, no distribution shall be made pursuant to this
Section 3.4 if the Participant shall be in Service on the date payment
of the lump sum is to be made.
3.5 Payment of Accounts
As of the close of business of the Plan on the Adjustment Date
coincident with or next following the date a Participant retires, the
balance in his Accounts, as adjusted as of such Adjustment Date, shall
be paid to him in a lump sum. In applying the foregoing provisions of
this Section 3.5, the following special provisions shall apply:
(a) Payment must be made within sixty days following the later of:
(i) the Year-End Adjustment Date coincident with or next
following his Normal Retirement Age, or
(ii) the close of the Plan Year in which he shall retire or
otherwise terminate Service.
In the event that, within the applicable sixty-day period, the
amount of payment cannot be determined or the recipient thereof
cannot be located after a reasonable effort has been made to
locate him, payments retroactive to the close of such sixty-day
period shall be made within sixty days after the amount has been
determined or the recipient has been located, whichever shall be
applicable.
(b) Notwithstanding any provision of this Plan to the contrary,
distribution of the Accounts of a Participant shall commence no
later than the first day of April following the earlier of:
(i) the calendar year in which the Participant attains age
70 1/2, or
(ii) the calendar year in which the Participant retires.
-27-
(c) Distributions from the Plan shall be in cash or in kind, or partly in
cash and partly in kind, as determined by the Committee in its
discretion.
(d) All amounts payable to a Participant shall be subject to the rights
afforded to an "alternate payee" under a "qualified domestic relations
order" as those terms are defined in Section 414(p) of the Code.
3.6 Death
As of the Adjustment Date coincident with or next following the death while
in Service of a Participant or the death of a terminated or Retired
Participant who has a vested balance in any of his Accounts at the time of
his death, his Beneficiary (subject to the provisions of Section 10) shall
receive such balance in a lump sum.
3.7 Continued Share in Profits or Losses of Trust Fund
If all or any part of the balances in the Accounts of any individual is
being held in the Trust for future payment to him, his Accounts under the
Plan shall continue to be adjusted as provided in Sections 5.3.
3.8 Loans
Upon the written application of any Participant who is in Service on
or after July 1, 1995, the Committee in accordance with its uniform,
nondiscriminatory policy may direct the Trustee to permit the Participant
to borrow from the Trust, subject to the following provisions:
(a) The Participant shall borrow from the amounts in his Accounts. The
loan principal will be funded from his Accounts in the following
order. First, from the Participant's Rollover Account; second, from
the Nondeductible Contribution Account; third, from the Employer
Matching Contribution Account; and fourth, from the Salary Reduction
Contribution Account. Within each Account, borrowings shall be
allocated proportionately among the elected Investment Funds. Loan
repayments shall be allocated back to the Participant's Accounts in
reverse order to which the loan principal is withdrawn. The minimum
principal amount of
-28-
any loan to a Participant shall be $500. The maximum principal
amount of any loan made to the Participant, when added to the then
unpaid balance on all loans previously made to the Participant,
shall not exceed the following applicable limitation:
(i) $50,000, if the vested balance in the Accounts of the
Participant shall be $100,000 or more reduced by the highest
outstanding loan balance of the Participant within the 12
months preceding the date of the loan; or
(ii) One-half of the vested balance in the Accounts of the
Participant, if the vested balance in the Accounts of the
Participant shall be less than $100,000.
If a Participant shall have a vested accrued benefit in more than
one tax-qualified retirement plan of the Employer, the limitation in
(i) or (ii) shall be applied both with respect to this Plan only and
with respect to all such plans in the aggregate. In applying the
limitations with respect to this Plan, only loans to the Participant
under this Plan and the vested balance in his Accounts under this
Plan shall be taken into account. In applying the limitations with
respect to all such plans in the aggregate, all loans to the
Participant under all such plans and the sum of the vested balance
in his Accounts and his vested accrued benefits under all such plans
shall be taken into account.
(b) All loans shall be allocated to the Accounts of the borrowing
Participant and shall be repayable by their terms within five years
from the date made, except that the obligation to repay shall not
exceed twenty years with respect to a loan made to a Participant for
the purpose of acquiring, or constructing any dwelling unit
(including a house, apartment, condominium or a mobile home not used
on a transient basis) which is used or will be used within a
reasonable time (determined at the time the loan is made) as the
primary residence of the Participant. A Participant may have two
loans outstanding at any time but only one may be a general purpose
five-year loan and the other must be a loan for the purchase or
construction of a principal residence.
-29-
(c) An application for a loan shall be made in writing to the Committee
on a form provided by the Committee. Each Participant making an
application for a loan shall receive from the Trustee a statement of
the terms of each loan transaction. This statement shall include the
amount financed and the annual interest rate.
(d) Each loan shall be secured by the pledge of the amounts in the
borrowing Participants Accounts. After July 1, 1995, no other
security shall be accepted or requested by the Committee as security
for the loan.
(e) Each loan shall be evidenced by a negotiable promissory note (the
"note") in form acceptable to the Trustee, payable to the order of
the Trustee, bearing interest at the prime rate as determined by the
Committee as of the first day of the month in which the loan is
initiated and, except as provided in Section 3.8(b), payable in full
not more than five years from the date thereof. The borrowing
Participant shall execute any additional documents as shall be
deemed necessary or advisable by the Committee to consummate the
loan and to provide reasonable safeguards. The principal amount of
each loan to a Participant shall be an investment allocated solely
to the appropriate Accounts of the borrowing Participant and the
note and all interest paid thereon shall be allocated to the
Accounts of the borrowing Participant as provided in Sections 5.3
and 5.4. The Employer shall establish a procedure for withholding at
appropriate intervals from the borrowing Participant's regular
payroll checks amounts necessary to satisfy the borrowing
Participant's repayment obligations under the note. All amounts so
withheld shall be transferred immediately to the Trustee.
(f) The occurrence of any one or more of the following events of default
shall constitute a default by the borrowing Participant under the
terms of the loan, whereupon the unpaid balance of the note,
together with accrued interest, will immediately become due and
payable without presentment, demand, protest, or notice of any kind.
Events of default include: (i) failure to make any payment when due,
whether by acceleration or otherwise; (ii) bankruptcy or insolvency
of the borrowing Participant; (iii) death, retirement or termination
of Service of the
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borrowing Participant; or (iv) a hardship withdrawal as provided in
Section 3.9. Effective July 1, 1995, (iv) above shall no longer
constitute a default.
(g) If an event of default shall occur with respect to a borrowing
Participant, the entire unpaid principal amount of the note, plus
accrued and unpaid interest, shall immediately become due and
payable. Unless such unpaid principal and interest are paid within
90 days following such default, such unpaid principal and interest
shall be charged against the defaulting Participant's Accounts as a
payment therefrom as provided in Section 5.3. The Participant shall
remain liable for any deficiency. No distribution to which such
Participant or the Beneficiary of such Participant is entitled under
the Plan shall be made to such Participant or to his Beneficiary
unless and until all unpaid loans, including interest thereon, have
been satisfied.
3.9 Pretermination Distributions
(a) Hardship withdrawals
(i) A Participant may, at any time prior to his termination of
Service, make application to the Committee to withdraw in a
lump sum all or a portion of the balance (determined as of
the Adjustment Date coincident with or immediately preceding
the date a withdrawal request is made) of his Salary
Reduction Contribution Account by reason of the immediate
and heavy financial needs of the Participant. A withdrawal
on account of immediate and heavy financial needs shall not
exceed the amount required to meet the immediate financial
need created by the hardship and not otherwise reasonably
available from other resources of the Participant. For
purposes of this Section 3.9(a), "immediate and heavy
financial needs" shall be limited to those financial needs
arising on account of the illness or accident of a
Participant or a member of his immediate family. Immediate
and heavy financial needs shall not include those expenses
which are reasonably anticipated to be covered by insurance.
The determination of whether a heavy financial need
constitutes an immediate and heavy financial need within the
scope of this Section 3.9(a) and the pertinent sections of
the Code
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shall be made by the Committee in its sole and exclusive
discretion, and its decision to grant or deny a withdrawal
on account of financial hardship shall be final. The
Committee shall apply uniform and nondiscriminatory
standards in making its decision. Effective July 1, 1995,
"immediate and heavy financial need" shall also include
purchase of a Participant's principal residence, payment of
post-secondary tuition for the Participant, Participant's
spouse, children or dependents for a 12-month period, or
prevention of eviction or foreclosure on the mortgage of the
Participant's principal residence. The Participant's
representation that one of these events has occurred and
cannot be relieved by other sources specified in the section
401(k) regulations shall constitute acceptable evidence of
hardship without further investigation by the Committee.
(ii) The Participant's request for a withdrawal on account of
financial hardship must be made in writing. The request must
specify the nature of the financial hardship, the total
amount to be withdrawn from his Salary Reduction
Contribution Account, and that the financial needs cannot be
satisfied from other resources including non-taxable plan
loans.
(iii) If a withdrawal under this Section 3.9(a) is approved, such
withdrawal shall be made as of the next following Adjustment
Date. The processing of the request shall be completed as
soon as practicable from the dated on which the Trustee
receives the properly completed written request for a
withdrawal on account of financial hardship. If a
Participant's termination of Service occurs after a request
is approved in accordance with this Section 3.9(a) but prior
to distribution of the full amount approved, the approval of
his request shall be automatically void and the benefits he
is entitled to receive under the Plan shall be distributed
in accordance with the applicable distribution provisions of
the Plan. Only one withdrawal shall be made within any Plan
Year. Effective July 1, 1995, the limitation to one
withdrawal per Plan Year is eliminated.
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(iv) The Committee may from time to time adopt additional
policies or rules governing the manner in which such
withdrawals may be made so that the Plan may be conveniently
administered.
(v) In the event that a Participant should make a withdrawal
pursuant to this Section 3.9(a), Salary Reduction
Contributions and Nondeductible Voluntary Contribution on
his behalf shall be suspended for 12 months following the
date as of which such hardship withdrawal is made. Any
election to resume Salary Reduction Contributions and
Nondeductible Voluntary Contributions must be made in
writing as provided in Section 2.1. Amounts withdrawn
pursuant to this Section 3.9(a) shall not be returned to the
Plan.
(b) Distributions after age 59 1/2: A Participant who has attained the
age of 59 1/2 may elect, by written request to the Committee, to
withdraw from his Salary Reduction Contribution account an amount
not in excess of the adjusted balance thereof, determined as of the
Adjustment Date coinciding with or next preceding the date of such
withdrawal. No withdrawal made under this Section 3.9(b) shall be
for an amount which is less than the lesser of: (i) $500, or (ii)
the adjusted balance in the Participant's Salary Reduction
Contribution Account. Effective July 1, 1995, the $500 minimum
distribution is eliminated.
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Section 4 - Vesting
-------------------
4.1 Salary Reduction Contribution Accounts, Nondeductible Voluntary Employee
Contribution Accounts, and Rollover Contribution Accounts A Participant
shall be fully vested in each of these Accounts at all times.
4.2 Employer Matching Contribution Accounts
A Participant shall be fully vested in his Employer Matching Contribution
Account upon the completion of a period of three years of service. If a
Participant should incur a severance from service prior to the completion
of three years of service, such contribution account shall be forfeited and
used to reduce future Employer Matching Contributions.
4.3 Restoration of Employer Matching Contribution Accounts
A Participant who receives a distribution upon separation from service and
who forfeits all or a portion of his Employer Matching Contribution Account
shall have the balance in his Employer Matching Contribution Account
restored if:
(a) the Participant is rehired before incurring a period of severance
equal to or greater than five years, and
(b) the Participant repays to the Plan the amount of his distribution
from his Salary. Reduction Contribution Account, with 5% interest
compounded annually, within 12 months of reemployment.
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Section 5 - Accounts; Investment Funds,
Adjustment of Accounts of Participants
--------------------------------------
5.1 Accounts
The Committee shall maintain with respect to each Participant the following
Accounts: (a) his Salary Reduction Contribution Account, (b) his Employer
Matching Contribution Account, (c) his Nondeductible Contribution Account, (d)
his Direct Transfer Account, and (e) his Rollover Account.
5.2 Investment Funds
(a) All assets of the Trust shall be held in the investment funds
selected by the Committee and Trustees, among the following types of
Investment Funds. The Committee and Trustees may add or eliminate
from time to time one or more investment funds. Such Funds shall be
referred to herein singularly as an "Investment Fund" and
collectively as "Investment Funds." Within each Investment Fund
separate records shall be kept with respect to amounts therein
allocated to the respective Accounts of the Participants, but all
assets of each Investment Fund may be, commingled for investment
purposes. Pending the selection and purchase of suitable investments
or reinvestment, or the payment of expenses or other anticipated
distributions, any portion of an Investment Fund may be retained in
cash without liability for payment of interest or may be invested in
short-term, interest-bearing securities, whether or not such
investment would otherwise be appropriate for the particular
Investment Fund.
(b) Direction of Investment; Separate Subsidiary Accounts: Any
individual having a balance to his credit in any of the Accounts
under the Plan is empowered, acting through the Committee, to direct
the Trustee as to the investment or reinvestment of such amounts
among the Investment Funds described in Section 5.2(a). The
Committee shall cause separate subsidiary accounts to be kept for
each individual for the accounts referred to in Section 5.1.
References herein to the "Fund
-35-
Accounts" of a Participant shall mean all of the subsidiary accounts
with respect to the Investment Funds.
(c) Allocation to Investment Funds: The amount of any Salary Reduction
Contributions, Employer Matching Contributions, Nondeductible
Voluntary Contributions, Direct Transfer Contributions, and Rollover
Contributions (the "Contributions") allocated to the Plan with
respect to a Participant shall be credited to his appropriate Fund
Account in accordance with the following rules:
(i) By application in writing to the Committee at least ten days
prior to the 25th day of March, June, September or December
(prior to December 23, 1992) and the 23rd day of any month
on or after December 23, 1992, each Participant shall be
entitled to designate, in increments of ten percent (twenty-
five percent prior to December 31, 1992) the percentage of
Contributions made following the next preceding Adjustment
Date which shall be apportioned to each of his appropriate
Fund Accounts. In the event that amounts shall not be
transferrable to one of the Investment Funds as of any
Adjustment Date, amounts to be transferred to such
Investment Fund pursuant to a designation under this
paragraph (a) shall be held in the Short Term Savings Fund
until such amounts may be so transferred, at which time the
contributions and earnings with respect thereto, shall be so
transferred.
(ii) A designation made by the Participant under paragraph (i)
above shall remain in effect as of each succeeding
Adjustment Date, unless the Participant shall file a timely
election providing for a different designation with respect
to any Adjustment Date.
(iii) If for any reason a Participant shall not have made an
effective designation with respect to any Contribution
allocable to him as of any Adjustment Date such Contribution
shall be credited to his appropriate Fund Account and
invested in the Short Term Savings Fund.
(iv) Effective July 1, 1995, fund allocations may be designated
in one percent increments and may be made at any time.
-36-
(d) Reallocation among Investment Funds: Each individual having an
amount credited to one or more Fund Accounts shall be entitled to
cause all or a portion of such amount to be transferred to another
appropriate Fund Account at the same time and in the same manner
specified in (c) above.
(e) Notification of Trustee: The Committee shall notify the Trustee of
all applications made in accordance with Sections 5.2(c) and 5.2(d)
as required by the Trustee.
5.3 Adjustments to Accounts
With respect to each individual with one or more Accounts under the Plan, the
amount in each of his separate Fund Accounts as of each Adjustment Date,
ascertained with respect to each under this Section 5.3 and herein called the
"basic credit" shall be adjusted as of each succeeding Adjustment Date by the
following credits and debits, in the order stated (references in this Section
5.3 to the "Investment Fund" shall mean the Investment Fund in which each such
Fund Account is invested):
(a) With respect to each separate Fund Account, there shall be debited
the total amount of any distributions from each such account since
the last preceding Adjustment Date to him or for his benefit. With
respect to an individual receiving a distribution from one or more
of his separate Fund Accounts, the portion of such distribution with
respect to each account allocated to each Investment Fund shall be
determined by multiplying the amount of such distribution with
respect to such account by a fraction, the numerator of which is the
amount of the portion of such account in the Investment Fund
following adjustment as of the next preceding Adjustment Date, and
the denominator of which is the total amount in such account
following adjustment as of such Adjustment Date.
(b) With respect to each separate Fund Account, there shall be credited
or debited that portion of the net income or net loss of the
Investment Fund since the next preceding Adjustment Date which his
basic credit as of such preceding Adjustment Date, further adjusted
as provided in Section 5.3(a), bears to the total of the basic
credits of all such individuals as of such preceding Adjustment Date
so adjusted. Such net income or net loss shall be ascertained by the
trustee and shall mean the profits and income actually realized and
received, less the losses and expenses
-37-
actually incurred and paid, plus any net increase or minus any net
decrease in the fair market value of the assets of the Investment
Fund not actually realized and received or incurred and paid. In
ascertaining such value, the expense of liquidation shall not be
taken into account. "Basic credit as of the next preceding
Adjustment Date" shall be such credit after the adjustments under
this Section 5.3 shall have been made.
(c) With respect to each separate Fund Account, there shall be credited
that portion of the appropriate Contribution to be allotted to such
account as provided in Section 5.2.
5.4 Loan Accounts
Notwithstanding the foregoing provisions of this Section 5, the portion of
any Account of a Participant evidenced by a note described in Section
3.8(e) shall be held in a special Loan Account in behalf of the
Participant. The Loan Account shall be a part of the specific Account of
the participant, and there shall be credited to the Loan Account any
payments of principal or interest made with respect to said note, which
payments shall be invested by the Trustee in the Short Term Savings Fund
pending the next preceding Adjustment Date. As of the close of business on
each Adjustment Date, any cash balances in the Loan Account shall be
debited to the Loan Account and shall be allocated to the Investment Fund
or Funds with respect to the Participant as specified in Section 3.8(a).
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Section 6 - Administration by Committee
---------------------------------------
6.1 The Committee shall be responsible for the general administration and
interpretation of the Plan and for carrying out its provisions, except to
the extent all or any of such obligations are specifically imposed on the
Trustee or the Board. The Committee shall constitute the Plan
Administrator and the Chairman of the Committee shall be agent for service
of legal process on the Plan.
6.2 The members of the Committee shall elect a Chairman and may elect an
acting Chairman. They shall also elect a Secretary and may elect an acting
Secretary, either of whom may be but need not be a member of the
Committee. The Committee may appoint from its membership such
subcommittees with such powers as the Committee shall determine, and may
authorize one or more of its members or any agent to execute or deliver
any instruments or to make any payment in behalf of the Committee.
6.3 The Committee shall hold such meetings upon such notice, at such places
and at such intervals as it may from time to time determine. Notice of
meetings shall not be required if notice is waived in writing by all the
members of the Committee at the time in office, or if all such members are
present at the meeting.
6.4 A majority of the members of the Committee at the time in office shall
constitute a quorum for the transaction of business. All resolutions or
other actions taken by the Committee at any meeting shall be by vote of a
majority of those present at any such meeting and entitled to vote.
Resolutions may be adopted or other action taken without a meeting upon
written consent thereto signed by all of the members of the Committee.
6.5 The Committee shall maintain full and complete records of its
deliberations and decisions. The minutes of its proceedings shall be
conclusive proof of the facts of the operation of the Plan. The records of
the Committee shall contain all relevant data pertaining to individual
Participants and their rights under the Plan and in the Trust Fund.
-39-
6.6 Subject to the limitations of the Plan and of ERISA the Committee may from
time to time establish rules or by-laws for the administration of the Plan
and the transaction of its business.
6.7 No individual member of the Committee shall have any right to vote or
decide upon any matter relating solely to himself or to any of his rights
or benefits under the Plan (except that such member may sign unanimous
written consent to resolutions adopted or other action taken without a
meeting).
6.8 The Committee may correct errors and, so far as practicable, may adjust
any benefit or credit or payment accordingly. The Committee may in its
discretion waive any notice requirements in the Plan; provided that a
waiver of a requirement to notify the Trustee shall be made only with the
consent of the Trustee. A waiver of notice in one or more cases shall not
be deemed to constitute a waiver of notice in any other case. With respect
to any power or authority which the Committee has discretion to exercise
under the Plan, such discretion shall be exercised in a nondiscriminatory
manner.
6.9 Subject to the claims procedure set forth in Section 13, the Committee
shall have the duty and authority to interpret and construe the provisions
of the Plan and to decide any dispute which may arise regarding the rights
of Participants hereunder, which determinations shall apply uniformly to
all persons similarly situated and shall be binding and conclusive upon
all interested persons.
6.10 The Committee may engage an attorney, accountant or any other technical
advisor on matters regarding the operation of the Plan and to perform such
other duties as shall be required in connection therewith, and may employ
such clerical and related personnel as the Committee shall deem requisite
or desirable in carrying out the provisions of the Plan. The Committee
shall from time to time, but no less frequently than annually, review the
financial condition of the Plan and determine the financial and liquidity
needs of the Plan as
-40-
required by ERISA. The Committee shall communicate such needs to the
Employer and to the Trustee so that the funding policy and investment
policy may be appropriately coordinated to meet such needs.
6.11 No fee or compensation shall be paid to any member of the Committee for
his service as such.
6.12 The Committee shall be entitled to reimbursement out of the Trust Fund for
its reasonable expenses properly and actually incurred in the performance
of its duties in the administration of the Plan; provided, that the BDM
International, Inc. may, in the discretion of the Board, pay such
expenses.
6.13 To the maximum extent permitted by ERISA, no member of the Committee shall
be personally liable by reason of any contract or other instrument
executed by him or on his behalf as a member of the Committee nor for any
mistake of judgment made in good faith, and BDM International, Inc. shall
indemnify and hold harmless, directly from its own assets (including the
proceeds of any insurance policy the premiums for which are paid from BDM
International, Inc. own assets), each member of the Committee and each
other officer, employee, or director of BDM International, Inc. to whom
any duty or power relating to the administration or interpretation of the
Plan may be delegated or allocated, against any unreimbursed or uninsured
cost or expense (including any sum paid in settlement of a claim with the
prior written approval of the Board) arising out of any act or omission to
act in connection with the Plan unless arising out of such person's own
fraud, bad faith, willful misconduct or gross negligence.
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Section 7 - Management of Funds and Amendment of Plan
-----------------------------------------------------
7.1 All assets of the Plan shall be held in a Trust forming part of the Plan,
which shall be administered as a Trust Fund to provide for the payment to
the Participants or their successors in interest, out of the income and
principal of the Trust, of benefits as provided in the Plan. All
fiduciaries (as defined in ERISA) with respect to the Plan shall discharge
their duties as such solely in the interest of the Participants and their
successors in interest, and (1) for the exclusive purposes of providing
benefits to Participants and their successors in interest and defraying
reasonable expenses of administering the Plan, including the trust which
is a part of the Plan, (2) with the care, skill, prudence and diligence
under the circumstances then prevailing that a prudent man acting in a
like capacity and familiar with such matters would use in the conduct of
an enterprise of like character and with like aims, and (3) in accordance
with the Plan and Trust Agreement, except to the extent such documents may
be inconsistent with the then applicable federal laws relating to
fiduciary, responsibility. The Trust Fund shall be used for the exclusive
benefit of the Participants and beneficiaries and to pay administrative
expenses of the Plan and Trust to the extent not paid by BDM
International, Inc., and no portion of the Trust Fund shall ever revert to
or inure to the benefit of the Employer (except as otherwise provided in
Sections 2 and 7.1(a). Notwithstanding the foregoing provisions of this
Section 7.1, the following special provisions shall apply:
(a) Notwithstanding any other provisions of the Plan, if the Employer
shall (i) make a contribution to the Plan by a mistake of fact, or
(ii) make a contribution to the Plan conditioned upon its
deductibility under Section 404 of the Code and such contribution
shall be determined to be nondeductible, or (iii) make a
contribution to the Plan conditional upon the initial qualification
of the Plan under Section 401(a) of the Code and the qualified
status of the Plan with respect to the Plan Year for which such
contribution is made shall be denied, then in any such event such
contribution shall be returned to the Employer without interest or
other increment as soon as practicable, but in no event later than
one year after said mistaken payment or after it shall be finally
determined that the contribution is not deductible or after
-42-
final determination of denial of qualified status of the Plan,
whichever shall be applicable. The amount to be so returned shall
reflect Trust net losses, if any, following said contribution, and
shall be limited to the extent necessary to avoid a reduction of the
balance of the Salary Reduction Contribution Account of any
participant below what his balance would have been if such
contribution (to the extent made by mistake or determined to be
nondeductible or made with respect to a year for which the Plan is
disqualified) had not been made.
(b) The Board, acting in behalf of the Employer, shall have the right at
any time and from time to time to amend or terminate the Plan and
the Trust Agreement entered into under the Plan; provided, that no
such amendment which shall alter the duties, responsibilities or
liabilities of the Trustee shall be made unless the Trustee shall
consent thereto in writing. See Section 11 for provisions regarding
termination of the Plan. No amendment to the Plan shall decrease the
balance of the Accounts of a Participant as of the date of such
amendment or eliminate an optional form of distribution.
7.2 The Employer and the Trustee shall enter into an appropriate Trust
Agreement for the administration of the Trust under the Plan. Such
agreement shall contain such powers and reservations as to investment,
reinvestment. control and disbursement of the funds of the Trust, and such
other provisions not inconsistent with the provisions of this Plan and its
nature and purposes as shall be agreed upon and set forth therein. Said
agreement shall provide that the Board may remove the Trustee at any time
upon reasonable notice, that the Trustee may resign at any time upon
reasonable notice, and that upon such removal or resignation of the
Trustee, the Board may designate one or more successor Trustees.
7.3 All requests, directions, requisitions and instructions of the Committee
to the Trustee shall be in writing and signed by such person or persons as
shall be designated by the Committee.
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Section 8 - Allocation of Responsibilities Among Named Fiduciaries
------------------------------------------------------------------
8.1 The named fiduciaries with respect to the Plan and the fiduciary duties
and other responsibilities allocated to each are as follows:
(a) Board
(i) To amend the Plan;
(ii) To appoint and remove the Trustee under the Plan; and
(iii) To terminate the Plan.
(b) Committee
(i) To interpret the provisions of the Plan and to determine the
rights of participants under the Plan, except to the extent
otherwise provided in Section 13 relating to claims
procedure;
(ii) To administer the Plan in accordance with its terms, except
to the extent powers to administer the Plan are specifically
delegated to another named fiduciary or other person or
persons as provided in the Plan;
(iii) To account for the balances in the Accounts of Participants;
(iv) To direct the Trustee in the distribution of Trust assets;
(v) To file such reports as may be required with the United
States Department of Labor, the Internal Revenue Service and
any other government agencies to which reports may be
required to be submitted from time to time; and
(vi) To comply with requirements of law for disclosure of Plan
provisions and other information relating to the Plan to
Participants and other interested parties; and
(vii) To administer the claims procedure to the extent provided in
Section 13.
(c) Trustee
(i) To invest and reinvest Trust assets subject to directions of
the investment manager; if any;
(ii) To perform such administrative duties as the Trustee and the
Committee shall agree upon from time to time; and
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(iii) Except to the extent otherwise provided in Section 8.1 (e):
(A) To make distributions to Participants as directed by
the Committee;
(B) To render annual accounting to the Employer as provided
in the Plan; and
(C) Otherwise to hold, administer and control the assets of
the Trust as provided in the Plan and Trust Agreement.
(d) Investment Manager: In the event the Trustee shall appoint an
investment manager to manage (including the power to acquire and
dispose of) assets of the Trust under the Plan, as provided in
Section 2.4 of the Trust Agreement, the duties of the investment
manager shall be to manage, acquire and dispose of assets of the
Trust, or to direct the Trustee in the management, acquisition and
disposition of assets of the Trust.
(e) Custodian: In the event the Trustee shall appoint a custodian to
hold and manage the assets of the Trust under the Plan, as provided
in Section 2.5 of the Trust Agreement, then notwithstanding the
foregoing provisions of this Section 8.1 or any other provisions of
the Plan and Trust Agreement, the duties of the custodian shall be
to receive, hold, sell, exchange and otherwise deal with the assets
of the Trust, as instructed by the Trustee (or as instructed by the
investment manager, if any, to the extent of the authority of the
investment manager), to make distributions to participants as
directed by the Committee and to render accounting to the Trustee as
provided in Section 3 of the Trust Agreement.
8.2 Except as otherwise provided in ERISA, a named fiduciary shall not be
responsible or liable for any act or omission of another named fiduciary
and respect to fiduciary responsibilities allocated to such other named
fiduciaries, and a named fiduciary of the Plan shall be responsible and
liable only for its own acts or mission with respect to fiduciary duties
specifically allocated to it and designated as its responsibility.
-45-
Section 9 - Benefits Not Assignable; Facility of Payments
---------------------------------------------------------
9.1 No portion of any benefit held or paid under the Plan with respect to any
Participant shall be subject in any manner to anticipation, alienation,
sale, transfer, assignment, pledge, encumbrance or charge, and any attempt
so to anticipate, alienage, sell, transfer, assign, pledge, encumber or
charge the same shall be void, nor shall any portion of such benefit be in
any manner payable to any assignee, receiver or any one Trustee, or be
liable for his debts, contracts, liabilities, engagements or torts, or be
subject to any legal process to levy upon or attach; provided, that this
Section 9.1 shall not apply to the creation, assignment, or recognition of
a right to any benefit payable with respect to a Participant pursuant to a
qualified domestic relations order, as defined in Section 414(p) of the
Code, or any domestic relations order entered before January 1, 1985.
9.2 If any individual entitled to receive a payment under the Plan shall be
physically, mentally or legally incapable of receiving or acknowledging
receipt of such payment, the Committee, upon the receipt of satisfactory
evidence of his incapacity and satisfactory evidence that another person
or institution is maintaining him and that no guardian or committee has
been appointed for him, may cause any payment otherwise payable to him to
be made to such person or institution so maintaining him. Payment to such
person or institution shall be in full satisfaction of all claims by or
through the Participant to the extent of the amount thereof.
-46-
Section 10 - Beneficiary
------------------------
The Participant's Beneficiary shall be his surviving spouse, if any; provided,
that if he leaves no surviving spouse, or if he files a qualified election with
the Committee, the Participants Beneficiary (which may include more than one
person, natural or otherwise, and one or more secondary or contingent
beneficiaries) shall be the Beneficiary designated in the Beneficiary
designation form provided by the Committee. For purposes of this Section 10,
"qualified election" shall mean a written Beneficiary designation of the
Participant to which his surviving spouse files a written consent and
acknowledgment of the effect of such consent. Such consent and acknowledgement
shall be ineffective unless witnessed by a notary public. The consent of the
spouse shall not be required if it is established to the satisfaction of the
Committee that such consent cannot be obtained because there is no spouse or the
spouse cannot be located. The qualified election of a Participant may be revoked
at any time by action of the Participant, in which event the surviving spouse,
if any, shall be the Beneficiary. Any other change in Beneficiary shall be made
only by the filing of a revised qualified election. For this purpose, the
Participant's spouse or surviving spouse shall mean the legally married spouse
or surviving spouse of the Participant; provided, that a former spouse shall be
treated as the spouse or surviving spouse to the extent provided under a
qualified domestic relations order as described in Section 414(p) of the Code.
If the Participant's Beneficiary (other than his surviving spouse) dies prior to
asserting a written claim for any death benefit payable from the Trust under the
Plan, or if such participant fails to designate a Beneficiary (other than his
surviving spouse), then and in any of such events, such benefit shall be payable
to his estate. If a Beneficiary is receiving or is entitled to receive payments
from the Trust Fund and dies before receiving all of the payments due him, any
remaining payments shall be made to the contingent Beneficiary, if any, named
pursuant to a qualified election. If there is no contingent Beneficiary, the
balance shall be paid to the estate of the Beneficiary as of the adjustment date
coincident with or next following the date of his death. Any Beneficiary may
disclaim all or any part of any benefit to which such Beneficiary shall be
entitled hereunder by filing a written disclaimer with the Committee at least
ten days before payment of such benefit is to be made. Such
-47-
a disclaimer shall be made in form satisfactory to the Committee, and shall be
irrevocable when filed. Any benefit disclaimed shall be payable from the Plan in
the same manner as if the Beneficiary who filed the disclaimer had died on the
date of such filing.
-48-
Section 11 - Termination of Plan and Trust;
Removal of Trust
Merger or Consolidation of Plan
------------------------------------
11.1 Complete Termination
In the event of termination of the Plan, all Employer contributions shall
cease and no additional Participants shall enter the Plan. The assets
under the Plan shall be held in the Plan for distribution in accordance
with the provisions of Section 3; provided, that the Committee may in its
discretion provide for a liquidation of the Trust and distributions to the
Participants of their Accounts in cash, in kind, in the form of
nontransferable annuity contracts, or in any combination thereof. To the
extent not otherwise vested, all Participants shall become 100% vested in
their accounts.
11.2 Partial Termination
In the event of a partial termination of the Plan, the provisions of
Section 11.1 regarding a complete termination shall apply in determining
interests and rights of the Participants and their Beneficiaries with
respect to whom the partial termination shall occur, and shall apply to
the portion of the Trust Fund allocable to such Participants and
Beneficiaries.
11.3 Merger and Consolidation
In the event of any merger or consolidation of the Plan with any other
Plan, or a transfer of assets or liabilities of the Plan to any other
Plan (which merged, consolidated or transferee Plan shall be referred to
in this Section 11.3 as the "successor Plan"), the amount which each
Participant would receive if the successor Plan (and this Plan, if he
has any interest remaining therein) were terminated immediately after
the merger, consolidation or transfer shall be equal to or greater than
the amount he would have received if this Plan (and the successor plan,
if he had any interest therein immediately prior to the merger,
consolidation or transfer) had been terminated immediately preceding the
merger, consolidation or transfer.
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Section 12 - Communication to Participants
------------------------------------------
In accordance with the requirements of ERISA, the Employer shall communicate the
principal terms of the Plan to the Participants. The Employer shall make
available for inspection by Participants and their Beneficiaries during
reasonable hours, at the principal office of the Employer and at such other
places as may be required by ERISA, a copy of the Plan and of the Trust
Agreement and of such other documents as may be required by ERISA.
-50-
Section 13 - Claims Procedure
-----------------------------
The following claims procedure shall apply with respect to the Plan:
13.1 Filing of a Claim for Benefits
If a Participant or Beneficiary (the "claimant") believes that he is
entitled to benefits under the Plan which are not being paid to him or
which are not being accrued for his benefit, he shall file a written claim
with the Committee. In the event that a member of the Committee shall be a
claimant, he shall not be entitled to act as such with respect to his
claim.
13.2 Notification to Claimant of Decision
Within 90 days after receipt of a claim by the Committee (or within 180
days if special circumstances require an extension of time), the Committee
shall notify the claimant of his decision with regard to the claim. In the
event of such special circumstances requiring an extension of time, there
shall be furnished to the claimant prior to expiration of the initial 90-
day period written notice of the extension, which notice shall set forth
the special circumstances and the date by which the decision shall be
furnished. If such claim shall be wholly or partially denied, notice
thereof shall be in writing and worded in a manner calculated to be
understood by the claimant, and shall set forth:
(a) the specific reason or reasons for the denial;
(b) specific reference to pertinent provisions of the Plan on which the
denial is based;
(c) a description of any additional material or information necessary
for the claimant to perfect the claim and an explanation of why such
material or information is necessary; and
(d) an explanation of the procedure for review of the denial.
If the Committee fails to notify the claimant of the decision in a timely
manner, the claim shall be deemed denied as of the close of the initial
90-day period (or the close of the extension period, if applicable).
-51-
13.3 Procedure for Review
Within 60 days following receipt by the claimant of notice denying his
claim, in whole or in part, or, if such notice shall not be given, within
60 days following the latest date on which such notice could have been
timely given, the claimant shall appeal denial of the claim by filing a
written application for review with the Board. Following such request for
review, the Board shall fully and fairly review the decision denying the
claim. Prior to the decision of the Board, the claimant shall be given an
opportunity to review pertinent documents and to submit issues and
comments in writing.
13.4 Decision on Review
The decision on review of a claim denied in whole or in part by the
Committee shall be made in the following manner:
(a) Within 60 days following receipt by the Board of the request for
review (or within 120 days if special circumstances require an
extension of time), the Board shall notify the claimant in writing
of its decision with regard to the claim. In the event of such
special circumstances requiring an extension of time, written notice
of the extension shall be furnished to the claimant prior to the
commencement of the extension. If the decision on review is not
furnished in a timely manner, the claim shall be deemed denied as of
the close of the initial 60-day period (or the close of the
extension period, if applicable).
(b) With respect to a claim that is denied in whole or in part, the
decision on review shall set forth specific reasons for the
decision, shall be written in a manner calculated to be understood
by the claimant, and shall cite specific references to the pertinent
Plan provisions on which the decision is based.
(c) The decision of the Board shall be final and conclusive.
-52-
13.5 Action by Authorized Representative of Claimant
All actions set forth in this Section 13 to be taken by the claimant may
likewise be taken by a representative of the claimant duly authorized by
him to act in his behalf on such matters. The Committee and the Board may
require such evidence as either may reasonably deem necessary or advisable
of the authority to act of any such representative.
-53 -
Section 14 - Parties to the Plan
--------------------------------
As of the Effective Date of the Plan, each of the following named corporations
in addition to BDM International, Inc. is a party to the Plan and Trust
Agreement:
BDM Federal, Inc.
BDM Management Services Company
BDM Services Company
ZAPEX Corporation
Any other corporation which desires to do so (and which is an entity described
in Section 1.14(a)) may become a party to the Plan provided a written agreement
to that effect is made among such corporation, BDM International, Inc. and the
Trustee. As used in the Plan and in the Trust Agreement, except as otherwise
specifically set forth herein, the term "Employer" shall mean collectively all
such parties to the Plan. The Plan and Trust Agreement shall be applied as a
single plan and trust agreement with respect to all parties in all respects as
if there were only one employer-party, and Service for purposes of the Plan
shall be interchangeable among employer-parties to the Plan and shall not be
deemed to be interrupted by the transfer at any time of any Employee from the
Service or one employer-party to the service of another employer-party.
Notwithstanding the foregoing, the Board of BDM International, Inc. shall have
the power to amend or terminate the Plan and Trust Agreement as applied to each
party, or to delegate such power.
-54-
Section 15 - Special Top-Heavy Provisions
------------------------------------------
The following special provisions shall apply with respect to any Plan Year in
which the Plan is determined to be top-heavy (as described in Section 15.2):
15.1 Definitions
The following definitions shall apply for purposes of this Section 15
unless a different meaning is plainly required by the context.
(a) "Aggregate account" means, with respect to each Participant, the
balance in his Accounts as of the Valuation Date (defined in Section
15.1(l) corresponding to the Determination Date (defined in Section
15.1(e), following adjustment of such accounts as provided in
Section 5, subject to the following special provisions:
(i) An adjustment shall be made for any contributions due as of
the Determination Date. Such adjustment shall be the amount
of any contributions made after the Valuation Date but on or
before the Determination Date, except for the first Plan
Year when such adjustment shall also reflect the amount of
any contribution made after the Determination Date that are
allocated as of a date in that first Plan Year.
(ii) The amount of any distributions made from the Plan to the
Participant within the Plan Year that includes the
Determination Date or within the four preceding Plan Years
shall be included for purposes of determining the
Participant's Aggregate Account, except to the extent such
distributions are already included in the Participant's
Aggregate Account. The aggregate amount of distributions
made during the five-year period ending on the Determination
Date with respect to a Participant in a terminated plan
which, if it had not been terminated, would have been
required to be included in an Aggregation Group will be
included in accordance with the provisions of Section
416(g)(3) of the Code for purposes of determining the
Participant's Aggregate Account. Further, distribution from
the Plan (including the cash value of life insurance
policies) of a Participant's Account Balance because
-55-
of death shall be treated as a distribution for purposes of
this subparagraph (ii). See Section 15.1(i).
(iii) Transfers in the form of rollovers or direct plan-to-plan
transfers (herein "transfers") initiated by the Participant
and made from this Plan to a plan maintained by an unrelated
employer ("unrelated transfers") shall be deemed to be
distributions from this Plan for purposes of determining a
Participants Aggregate Account. Unrelated transfers to this
Plan shall not be considered part of the Participants
Aggregate Account. Transfers which either are not initiated
by the Participant or are made to another plan maintained by
the Employer or a related employer ("related transfers")
shall not be considered distributions for the purpose of
determining a Participant's Aggregate Account. Related
transfers to this Plan shall be considered part of the
Participants Aggregate Account, irrespective of the date on
which such related transfer occurs. For purposes of this
subparagraph (iii), all Related Employers shall be
considered a single employer.
(iv) Amounts attributable to Employer contributions and amounts
attributable to employee contributions, whether voluntary or
mandatory, shall be included in determining a Participant's
Aggregate Account, provided that amounts attributable to
deductible employee contributions shall be excluded from a
Participant's Aggregate Account.
(v) Except as otherwise provided in subparagraph (i), the value
of a Participant's Aggregate Account as of any Determination
Date shall be determined in accordance with the provisions
of Section 5 as of the Valuation Date which corresponds to
such Determination Date.
(vi) If this Plan shall be included in an Aggregation Group,
"Aggregate Account" shall mean the sum of the balances in
the Participant's accounts under all defined contribution
plans included in such Aggregation Group determined as of
the most recent Valuation Date within a twelve-month period
ending on the Determination Date.
-56-
(b) "Aggregation Group" means either a Required Aggregation Group or a
Permissive Aggregation Group as determined in this Section 15.1(b).
(i) Required Aggregation Group: The Required Aggregation Group
comprises all qualified plans (treating for this purpose any
simplified employee pension Plan as a qualified defined
contribution plan) of the Employer and Related Employers
which include a Key Employee as a Participant, and all other
qualified Plans of the Employer and Related Employers which
enable any qualified Plan which includes a Key Employee to
meet the requirements of Sections 401(a)(4) and 410 of the
Code. Each Plan in a required Aggregation Group will be
considered top-heavy if such group is a Top-Heavy Group. No
Plan in a required Aggregation Group will be considered top-
heavy if such group is not a Top-Heavy Group.
(ii) Permissive Aggregation Group: The Permissive Aggregation
Group comprises the required Aggregation Group plus any
other qualified Plan or Plans (treating for this purpose any
simplified employee pension Plan as a qualified defined
contribution plan) maintained by the Employer or a Related
Employer which are not required to be included in a Required
Aggregation Group and which, when considered together with
the Required Aggregation Group, would continue to satisfy
the requirements of Sections 401(a)(4) and 410 of the Code.
The Employer shall determine which Plan or Plans shall be
taken into account in determining the Permissive Aggregation
Group. In the case of a Permissive Aggregation Group which
is a Top-Heavy Group, only a Plan that is part of the
required Aggregation Group will be considered top-heavy. No
Plan in the Permissive Aggregation Group will be considered
top-heavy if the Permissive Aggregation Group is not a Top-
Heavy Group.
(iii) Special Rules: Only those Plans of the Employer and Related
Employers in which the Determination Dates fall within the
same calendar year shall be aggregated in order to determine
whether such Plans are top-heavy plans. An Aggregation Group
shall include any terminated plan of the Employer
-57-
and Related Employers if it was maintained within the last
five years ending on the Determination Date.
(c) "Compensation" for purposes of this Section 15 shall be as
defined in Section 2.3(d).
(d) "Cumulative Accrued Benefit" means the present value of a
Participant's Accrued Benefit under a defined benefit pension
plan (for an unaggregated plan) or the sum of the present values
of a Participant's Accrued Benefits under all defined benefit
plans included in an Aggregation Group (for aggregated plans).
The Cumulative Accrued Benefit with respect to a Participant
shall be determined with reference to the actuarial assumptions
for the Plan as of the most recent Valuation Date (which must
occur within the twelve-month period ending on the Determination
Date), and as if the Participant voluntarily terminated service
as of such Valuation Date. The Valuation Date must be the same
Valuation Date used for computing Plan costs for minimum funding
purposes, regardless of whether a valuation is performed that
year.
(e) "Determination Date" with respect to a Plan Year means (i) the
last day of the preceding Plan Year, or (ii) in the case of the
first Plan Year, the last day of such Plan Year.
(f) "Key Employee" means any Employee or former Employee (or the
Beneficiary of any such deceased employee) who, at any time
during the Plan Year that includes the Determination Date or any
of the preceding four Plan Years, is:
(i) An officer (within the meaning of Section 416 of the Code)
of the Employer or a Related Employer having annual
Compensation for the Plan Year greater than 150% of the
amount in effect under Section 415(c)(1)(A) of the Code for
the calendar year in which such Plan Year ends. For this
purpose the number of officers cannot exceed the lesser of
(A) or (B), where (A) is the greater of three Employees or
10% of all Employees and (B) is fifty Employees;
(ii) One of the ten Employees of the Employer or a Related
Employer having annual Compensation for the Plan Year
greater than the dollar limitation in
-58-
effect under Section 415(c)(1)(A) of the Code for the
calendar year in which such Plan year ends, and owning (or
considered as owning within the meaning of Section 318 of
the Code) during the Plan Year containing the Determination
Date or any of the four preceding Plan Years both more than
one-half percent interest and the largest interests in all
employers (including the Employer) required to be aggregated
under Sections 414(b), (c) and (m) of the Code (if two
Employees have the same interest, the one with the greater
compensation shall be treated as owning the larger interest);
(iii) Any person who owns (or is considered as owning within the
meaning or Section 318 of the Code) more than five percent
of the outstanding stock or the Employer or a Related
Employer or stock possessing more than five percent of the
total combined voting power of alls stock of the Employer or
Related Employer or in the case of an unincorporated
business, any person who owns more than five percent of the
capital or profits interest in such employer (in determining
percentage ownership under this subparagraph (iii), any
employers (including the Employer) that would otherwise be
aggregated under Section 414(b), (c) and (m) of the Code
shall be treated as separate employers); or
(iv) Any person having annual Compensation from the Employer or a
Related Employer for the Plan Year of more than $150,000 and
who owns (or is considered as owning within the meaning of
Section 318 of the Code) more than one percent of the
outstanding stock of the Employer or a Related Employer or
stock possessing more than one percent of the total combined
voting power of all such stock, or in the case of an
unincorporated business, any person who owns more than one
percent of the capital or profits interest in such employer.
In determining percentage ownership under this subparagraph
(iv), employers (including the Employer) that would
otherwise be aggregated under Section 414(B), (c) and (m)
of the Code shall be treated as separate employers.
-59-
In determining the amount of a person's Compensation for
purposes of subparagraphs (i), (ii) and (iii), compensation
from the Employer and all Related Employers (including all
employers required to be aggregated under Section 414(b),
(c) and (m) of the Code) shall be taken into account on an
aggregate basis. For purposes of this Section 15.1(f),
Section 318(a)(2)(C) of the Code shall be applied by
substituting five percent for fifty percent.
(g) "Non-Key Employee" means any Employee or former Employee
(including the Beneficiary of a deceased Non-Key Employee) who is
not a Key Employee.
(h) "Related Employer" means any corporation which is a member of a
controlled group of corporations (within the meaning of Section
414(b) of the Code) which includes the Employer or any trades or
businesses (whether or not incorporated) which are under common
control (within the meaning of Section 414(c) of the Code) with
the Employer, or a member of an affiliated service group (within
the meaning of Section 414(m) or the Code) which includes the
Employer.
(i) "Top-Heavy Group" means an Aggregation Group in which, as of the
Determination Date, the sum of (i) the Cumulative Accrued
Benefits of Key Employees under all defined benefit pension plans
included in the group, and (ii) the Aggregate Accounts of Key
Employees under all defined contribution plans included in the
group, exceeds sixty percent of a similar sum determined for all
Participants, excluding former Key Employees. A Top-Heavy Group
will be a "Super Top-Heavy Group" if the group would be top-heavy
if ninety percent were substituted for sixty percent in the
preceding sentence. The Cumulative Accrued Benefits and the
Aggregate Accounts of Participants in qualified Plans which are
part of an Aggregation Group shall be increased by the aggregate
distributions during the five-year period ending on the
Determination Date with respect to Participants under a
terminated Plan which, if it had not been terminated, would have
been required to be included in the Aggregation Group. In
determining whether the Aggregation Group is a Top-Heavy Group,
the Cumulative Accrued Benefits and Aggregate Accounts of Key
Employees and Non-Key Employees shall be determined separately
for each Plan as of the individual Plan's Determination
-60-
Date. The results for each Plan as of the Determination Dates
that fall within the same calendar year are then totaled to
determine whether the Aggregation Group is a Top-Heavy Group. The
Aggregate Account and the Cumulative Accrued Benefit of a Participant
or former Participant who has not performed any service for the
Employer at any time during the five-year period ending on the
Determination Date shall be disregarded.
(j) "Top-Heavy Plan Year" means a Plan Year in which the Plan is
Top-Heavy.
(k) "Unrelated Employer" means any corporation which is not a Related
Employer with respect to the Employer.
(l) "Valuation Date" means, with respect to this Plan, the year-end
Adjustment Date described in Section 1.4.
15.2 Determination of Top-Heavy Status
The Plan shall be top-heavy for any Plan Year if, as of the Determination
Date (a) the sum of the Aggregate Accounts of Key Employees under the Plan
exceeds sixty percent of the Aggregate Accounts of all Participants under
the Plan (the "60% test"), as determined in accordance with the provisions
of Section 416(g) of the Code; or (b) the Plan is part of a Required
Aggregation Group and the Required Aggregation Group is a Top-Heavy Group.
The Plan shall be "super top-heavy" for any Plan Year if, as of the
Determination Date, the Plan would meet the 60% test if ninety percent
(the "90% test") were substituted for sixty percent in the 60% test or the
Plan is part of a Required Aggregation Group and the Required Aggregation
Group is a Super Top-Heavy Group. Notwithstanding the results of the 60%
test or the 90% test, the Plan shall not be considered top-heavy or super
top-heavy for any Plan Year in which the Plan is part of a Required or
Permissive Aggregation Group which is not a Top-Heavy Group or Super
Top-Heavy Group. If any Participant is a Non-Key employee for any Plan
Year, but such Participant was a Key employee for any prior Plan Year, such
Participant's Aggregate Account balance shall not be taken into account for
purposes of determining whether the Plan is top-heavy or super top-heavy
(or whether any Aggregation Group which includes this Plan is a Top-Heavy
Group or a Super Top-Heavy Group). In addition, if a Participant or former
Participant has not performed any Service for the Employer or any Related
Employer maintaining the Plan (other than benefits under the
-61-
Plan) at any time during the five year period ending on the
Determination Date, the Aggregate Account for such Participant or
former Participant shall not be taken into account for purposes of
determining whether this Plan is top-heavy.
15.3 Top-Heavy Requirements
Notwithstanding any other provisions of the Plan, the Plan shall meet the
following requirements for any top-heavy Plan Year.
(a) Minimum vesting requirements. A Participant shall be vested in
his Salary Reduction Contribution Account, his Employer Matching
Contribution Account, his Nondeductible Contribution Account, his
Rollover Account and his Direct Transfer Account as provided in
Section 4.
(b) Minimum allocations required for Top-Heavy Plan Years. For any
Top-Heavy Plan Year, the Employer's Salary Reduction Contribution
allocated to the Salary Reduction Contribution Account of each
Non-Key employee shall be at least equal to the lesser of the
following percentages: (i) three percent of such Non-Key
employee's Compensation, or (ii) the percentage of such Non-Key
Employee's Compensation equal to the largest percentage which the
allocation of the Employer Salary Reduction Contribution to the
Salary Reduction Contribution Account of any Key employee bears
to such Key Employee's Compensation; provided, that (ii) above
shall not apply if the Plan is required to be included in an
Aggregation Group and the Plan enables a defined benefit pension
plan required to be included in the Aggregation Group to meet the
requirements of Sections 401(a)(4) and 410 of the Code. The
amount allocated to each Non-Key employee pursuant to this
Section 15.3(b) shall be referred to as the "minimum allocation".
The following special rules shall apply for purposes of this
Section 15.3(b):
(i) For purposes of determining the percentage in (ii) above,
the following special provisions shall apply:
(A) all defined contribution plans required to be included
in an Aggregation Group shall be treated as one plan; and
-62-
(B) the calculation of the percentage at which
contributions are allocated to the Salary Reduction
Contribution Account of a Key employee shall be based
only on his Compensation not in excess of the
401(a)(17) limit in effect for the calendar year in
which the Plan Year begins.
(ii) If a Key Employee is a Participant in both a defined
contribution plan and a defined benefit pension plan that
are both part of a Top-Heavy Group (but neither of such
plans is super top-heavy), the defined contribution and the
defined benefit fractions set forth in Section 2.3 of the
Plan shall remain unchanged, provided the Salary Reduction
Contribution Account of each Non-Key employee who is a
Participant receives an extra allocation (in addition to the
minimum allocation set forth in this Section 15.3(b)) equal
to not less than one percent of such Non-Key Employees'
compensation.
(iii) For purposes of this Section 15.3(b), any Employer
contributions or benefits under the Federal Social Security
Act shall not be taken into account.
(iv) The minimum allocations set forth in this Section 15.3(b)
shall be allocated to the Salary Reduction Contribution
Accounts of all Non-Key Employees who are Participants and
who are in Service on the last day of the applicable Top-
Heavy Plan Year.
(v) If a Non-Key employee is a Participant in both this Plan and
a defined benefit pension plan, and both such plans are top-
heavy with respect to a Plan Year, the Employer shall not be
required to provide a Non-Key Employee with both the minimum
benefit under the defined benefit plan and the minimum
contribution under this Plan. If the Non-Key Employees who
are participating in a defined benefit pension plan
maintained by the Employer or a Related Employer are
accruing under such plan and the minimum benefits provided
under Section 416(c)(1) of the Code, the Employer need not
make the minimum allocation described in this Section
15.3(b) on behalf of the Non-Key Employees. If a Non-Key
Employee is a Participant in both this Plan and another
defined contribution plan
-63-
maintained by the Employer and both such plans are included
in a Required Aggregation Group with respect to a Plan Year,
the Employer shall not be required to provide a Non-Key
Employee with both the minimum contribution under this Plan
and the minimum contribution under the other Defined
Contribution Plan. If the minimum contribution is being
provided to the Non-Key Employee under the other defined
contribution plan, the Employer need not make the minimum
allocation described in this Section 15.3(b) on behalf of
the Non-Key Employees. Notwithstanding the foregoing, in no
event shall the Employer make a minimum allocation under
this Plan with respect to a Non-Key Employee who is a
Participant in another defined contribution plan which is
subject to Section 412 of the Code and is included with
this Plan in a Required Aggregation Group. Alternatively,
the Employer may satisfy the minimum benefit requirement of
Section 416(c)(1) of the Code for a Non-Key Employee by
providing any combination of benefits or contributions that
satisfy the safe harbor rules of the applicable Treasury
Regulations.
(vi) The Committee may, in its discretion, separately account for
that portion of each Participant's Salary Reduction
Contribution Account attributable to Top-Heavy Plan Years
and Non-Top-Heavy Plan Years.
(vii) The minimum allocations made pursuant to this Section
15.3(b) (to the extent required to be nonforfeitable under
Section 15.3(a)) shall not be forfeitable under Section 411
(a)(3)(B) of the Code (relating to suspension of benefits
upon reemployment) or Section 411(a)(3)(d) of the Code
(relating to withdrawal of mandatory contributions).
(c) Maximum Compensation Limitation. For any Top-Heavy Plan Year,
Compensation in excess of the 401(a)(17) limit for the calendar year
in which the Plan Year begins shall be disregarded for purposes of
Section 15.3(b).
(d) Impact on special allocation limitations of Section 2.3. For any Plan
Year in which the Plan is super top-heavy, 1.0 shall be substituted
for 1.25 in Section 2.3(c) of the Plan. If the application of this
Section 15.4(d) with respect to a Super Top-Heavy
-64-
Plan would cause any Participant to exceed the combined
limitations on contributions and benefits described in Section
415 of the Code, the application of this Section 15.3(d) shall be
suspended as to such individual until such time as he no longer
exceeds the combined limitations of Section 415 of the Code as
modified by this Section 15.3(d). During the period of such
suspension, there shall be no contributions, forfeitures or
Nondeductible Voluntary Contributions allocated under this Plan
or any other defined contribution plan of a Related Employer and
there shall be no accruals for such individual under any defined
benefit plan of the Employer or Related Employer. If the Plan is
top-heavy but not super top-heavy for any Plan Year, the
substitutions referred to above with respect to a Super Top-
Heavy Plan shall be made only if the Employer makes the extra
minimum allocation described in Section 15.3(b)(ii). In no event
shall such substitution reduce any benefit accrued under a
defined benefit pension plan prior to the first day of the Plan
Year in which the top-heavy rules became effective.
(e) Construction. The provisions of this Section 15 shall apply with
respect to any Top-Heavy Plan Year notwithstanding any
conflicting provisions elsewhere in the Plan; provided, that the
provisions of this Section shall be applied in a manner to give
effect to the intent and purpose of Section 401(k) of the Code to
the extent applicable to this Plan.
-65-
SECTION 16 - PORTABILITY OF PARTICIPANT ACCOUNTS
-------------------------------------------------
Notwithstanding any other provision of this Plan, upon the request of the
Participant, the Trustee shall transfer the amount allocated to the credit
of a Participant in the Trust to the Trustee of any other exempt trust
which forms part of a tax-qualified retirement plan under Section 401 of the
Code or effective January 1, 1993 an individual retirement account or annuity.
-66-
SECTION 17 - SPECIAL PROVISIONS RELATING TO TRANSFERS FROM QUALIFIED PLANS
--------------------------------------------------------------------------
Upon the written direction of the Committee, the Trustee shall receive and
hold, as a part of the Trust Fund, assets (hereinafter referred to as the
"transferred assets," which shall be deemed to include all increments
allocable to such transferred assets) transferred in cash or in kind
directly from the trustee or custodian of any other retirement plan
(hereinafter referred to as the "transferor plan") which is qualified under
Section 401(a) of the Code. In applying the provisions of this Section 17,
the following special provisions shall apply:
17.1 The transferred assets shall at all times be fully vested in the
respective Participants (and in the proportions) to which such
transferred assets had been allocated under the transferor plan
immediately preceding the transfer.
17.2 The Trustee under this Plan, as such, shall not be liable or
responsible for any acts or omissions in the administration of any
transferor plan and the trust thereunder of any other person or
entity who was trustee, custodian or other fiduciary under any such
transferor plan, and the Trustee under this Plan shall be held
harmless from such liability or responsibility.
17.3 The Trustee shall keep a separate Direct Transfer Account with respect
to the transferred assets of each Participant which may be commingled
for investment purposes with other assets of the Trust.
17.4 All transferred assets shall be administered by the Trustee in the
same manner as other assets of the Trust are administered.
17.5 To the extent not inconsistent with the provision of this Section 17,
the Committee may promulgate rules or bylaws supplementing and
implementing the provisions of this Section 17.
-67-
17.6 Notwithstanding any provisions of this Section 17 to the contrary, the
Committee shall not permit, nor shall the Trustee accept, the transfer
to this Plan of transferred assets from a transferor plan which is
subject to the requirements of Section 401(a)(11) of the Code at the
time of the transfer.
-68-
SECTION 18 - ROLLOVERS
----------------------
An Employee who receives a distribution of his entire interest from another
retirement plan (including another plan maintained by the Employer) which
is qualified under Section 401(a) of the Code on the date of such
distribution may, with the written consent of the Committee and in
accordance with procedures approved by the Committee, transfer all or a
part of such distribution to the Trustee under this Plan. In applying the
provisions of this Section 18, the following special provisions shall
apply:
18.1 The transfer to the Trustee must occur on or before the 60th day
following the receipt by the Employee of such distribution or, if
such distribution has previously been deposited in an Individual
Retirement Account or Individual Retirement Annuity (as defined in
Section 408 of the Code), the transfer must occur on or before the
60th day following the receipt by the Employee of the balance to his
credit under such Individual Retirement Account or Individual
Retirement Annuity.
18.2 The distribution made to the Employee must be a qualified total
distribution within the meaning of Section 402(a)(5)(E)(i) of the
Code.
18.3 The amount transferred to the Trustee is limited to the maximum
rollover amount as provided in Section 402(a)(5)(B) of the Code.
18.4 The amount transferred to the Trustee shall be credited to a separate
Rollover Account with respect to the Employee.
18.5 Except as otherwise provided in this Section 18, the assets in the
Rollover Account shall be administered by the Trustee in the same
manner as other Trust assets. Assets of the Rollover Account may be
comingled for investment with other assets of the Trust Fund.
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18.6 Notwithstanding any provision of this Section 18 to the contrary, the
Committee shall not permit, nor shall the Trustee accept, the transfer
to this plan by an Employee of all or part of any distribution
received by such Employee from another qualified retirement plan if
any part of such distribution is attributable to contributions made
on behalf of the Employee while a key employee (within the meaning of
Section 416(i)(1) of the Code) in a top-heavy plan (within the
meaning of Section 416(g) of the Code).
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SECTION 19 - SPECIAL TRANSFER FROM RETIREMENT PLAN
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BDM Federal, Inc., which is a party to the Plan, is the sponsor of The BDM
Retirement Plan (the "Retirement Plan"). The Retirement Plan permits an
Employee to make voluntary nondeductible contributions which are maintained
in a separate account for his benefit under the Retirement Plan (the
"Retirement Plan Account"). As of the Effective Date of the Plan, the
Retirement Plan Account of a Participant under the Retirement Plan shall be
transferred to the Trust and allocated to his Nondeductible Contribution
Account as provided in Section 2.4. Such transfer shall be treated for
purposes of the Plan as a Nondeductible Voluntary Contribution of the
Participant.
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SECTION 20 - MISCELLANEOUS PROVISIONS
-------------------------------------
20.1 Notices
Each Participant who is not in Service and each Beneficiary shall be
responsible for furnishing the Plan Administrator with his current
address for the mailing of notices, reports, and benefit payments. Any
notice required or permitted to be given to such Participant or
Beneficiary shall be deemed given if directed to such address and
mailed by regular United States mail, first class, postage prepaid.
If any check mailed to such address is returned as undeliverable to
the addressee, mailing of checks will be suspended until the
Participant or Beneficiary furnishes the proper address. This
provision shall not be construed as requiring the mailing of any
notice or notification otherwise permitted to be given by posting or
by other publication.
20.2 Lost Distributees
A benefit shall be deemed forfeited if the Plan Administrator is
unable after a reasonable period of time, as determined by the
Committee, to locate the Participant or Beneficiary to whom payment
is due; provided, however, that such benefit shall be reinstated if a
valid claim is made by or on behalf of the Participant or Beneficiary
for the forfeited benefit.
20.3 Reliance on Data
The Employer, the Trustee, and the Plan Administrator shall have the
right to rely on any data provided by the Participant or by any
Beneficiary, including representations as to age, health, and marital
status. Such representations shall be binding upon any party seeking
to claim a benefit through a Participant, and the Employer, the
Trustee, and the Plan Administrator shall have no obligation to
inquire into the accuracy of any representation made at any time by a
Participant or Beneficiary.
20.4 Bonding
Unless exempted by ERISA, every fiduciary shall be bonded for each
Plan Year in accordance with the requirements of ERISA. The bond
shall provide protection to the Plan
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against any loss by reason of acts of fraud or dishonesty by the
fiduciary alone or in connivance with others. The cost of the bond
shall be an expense of the Trust and shall be paid from the Trust Fund
unless the Board shall elect for such cost to be paid by the BDM
International, Inc.
20.5 Receipt and Release for Payments
Any payment made from the Plan to or with respect to any Participant
or Beneficiary, or pursuant to a disclaimer by a Beneficiary, shall,
to the extent thereof, be in full satisfaction of all claims
hereunder against the Plan, the Employer and all fiduciaries with
respect to the Plan. The recipient of any payment from the Plan may
be required by the Committee, as a condition precedent to such
payment, to execute a receipt and release with respect thereto in
such form as shall be acceptable to the Committee.
20.6 Headings
The headings and subheadings of the Plan have been inserted for
convenience of reference and are to be ignored in any construction of
the provisions thereof.
20.7 Continuation of Employment
The establishment of the Plan shall not be construed as conferring any
legal or other rights upon any employee or any persons for
continuation of employment, nor shall it interfere with the right of
the Employer to discharge any Employee or to deal with him without
regard to the effect thereof under the Plan.
20.8 Construction
The provisions of the Plan shall be construed and enforced according
to the laws of the State of Virginia, except to the extent such laws
shall be superseded by the provisions of ERISA.
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IN WITNESS WHEREOF, the BDM International, Inc. 401(k) Savings Plan is, by
the authority of the Board of Directors of each of the parties hereto, executed
in behalf of each of said parties, this 21st day of December , 1995.
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BDM INTERNATIONAL, INC.
By: /s/ Philip A. Odeen
------------------------
President
Attest:
/s/ John F. McCabe
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