Exhibit 10(vii)
CURTISS-WRIGHT ELECTRO-MECHANICAL DIVISION
PENSION PLAN
Effective as of
October 29, 2002
TABLE OF CONTENTS
INTRODUCTION............................................................................1
SECTION 1 - DEFINITIONS.................................................................3
SECTION 2 - ELIGIBILITY FOR RETIREMENT.................................................14
SECTION 3 - ELIGIBILITY AND EMPLOYEE CONTRIBUTIONS.....................................15
SECTION 4 - NORMAL RETIREMENT PENSION..................................................17
SECTION 5 - EARLY RETIREMENT PENSION...................................................21
SECTION 6 - VESTED PENSION.............................................................23
SECTION 7 - REFUNDS OF EMPLOYEE CONTRIBUTIONS..........................................25
SECTION 8 - SURVIVING SPOUSE BENEFIT FOR DEATH BEFORE RETIREMENT.......................26
SECTION 9 - SURVIVING SPOUSE BENEFIT FOR CERTAIN VESTED EMPLOYEES......................28
SECTION 10 - FORM OF PENSION PAYMENTS..................................................30
SECTION 11 - DESIGNATION OF BENEFICIARY................................................37
SECTION 12 - ADMINISTRATION............................................................38
SECTION 13 - FUNDING...................................................................44
SECTION 14 - ACQUISITIONS, SALES, AND OTHER DISPOSITIONS...............................45
SECTION 15 - TRANSFERRED EMPLOYEES.....................................................47
SECTION 16 - SUSPENSION OF BENEFITS AND REEMPLOYMENT...................................49
SECTION 17 - MISCELLANEOUS.............................................................51
SECTION 18 - AMENDMENT AND TERMINATION.................................................53
SECTION 19 - FLAT RATE METHOD FOR 1994.................................................55
APPENDIX A - TOP HEAVY PROVISIONS......................................................58
APPENDIX B - SECTION 415 LIMITATIONS...................................................61
APPENDIX C - HISTORICAL FORMULAS.......................................................64
APPENDIX D - PARTICIPATING EMPLOYERS...................................................72
1
CURTISS-WRIGHT ELECTRO-MECHANICAL DIVISION
PENSION PLAN
INTRODUCTION
This Curtiss-Wright Electro-Mechanical Division Pension Plan ("the Plan") is
effective as of October 29, 2002 ("the Effective Date"). It has been established
to provide retirement benefits for eligible employees of the Curtiss-Wright
Electro-Mechanical Corporation ("EMD"), a wholly owned subsidiary of
Curtiss-Wright Flow Control Corporation ("CWFC"), a wholly owned subsidiary of
Curtiss-Wright Corporation.
CWFC acquired the operations that comprise EMD from Westinghouse Government
Services Company LLC. ("WGSC"), a subsidiary of Washington Group International,
Inc. ("WGI"), in a transaction that was effective as of the Effective Date.
Prior to the acquisition of EMD by CWFC, eligible employees at EMD participated
in the Westinghouse Government Services Group Pension Plan ("the Predecessor
Plan"), a pension plan maintained by WGSC and qualified under section 401(a) of
the Code. In accordance with an agreement between CWFC and WGSC, assets and
liabilities under the Predecessor Plan ("the Transferred Assets and
Liabilities"), determined as of the Effective Date, were transferred to the Plan
in a transaction that complied with section 414(l) of the Code. The Transferred
Assets and Liabilities comprised liabilities for benefits of participants in the
Predecessor Plan who were employed at EMD as of the Effective Date and for
benefits of participants in the Predecessor Plan who had terminated employment
at EMD a vested right to a deferred benefit from the Predecessor Plan or who had
commenced receiving benefits from the Predecessor Plan prior to the Effective
Date.
The provisions of the Plan, as set forth herein, are intended to apply to
participants who were employed at EMD on or after the Effective Date. Benefits
taken into account in the determination of the Transferred Assets and
Liabilities that are payable to participants who had terminated or retired from
employment at EMD prior to the Effective Date shall be determined in accordance
with the terms of the Predecessor Plan as in effect on the date the participant
terminated or retired from employment at EMD.
For employees whose benefits were taken into account in the determination of the
Transferred Assets and Liabilities ("the WGSC Transferees"), "Compensation",
Credited Service", and "Eligibility Service" under this Plan include
compensation, credited service, and eligibility service under the terms of the
Predecessor Plan for periods prior to the effective date of such transfer.
Origin and Scope of the Predecessor Plan:
The Predecessor Plan was first effective on April 1, 1999 and was established
subsequent to the acquisition of EMD and certain other businesses from CBS
Corporation ("CBS") by WGNH Acquisition LLC, an indirect subsidiary of WGI. The
Predecessor Plan generally mirrored the provisions of the GESCO Residual Pension
Plan ("the GESCO Plan"), a pension plan maintained by CBS, as then in effect.
Subsequent to the establishment of the Predecessor
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Plan, assets and liabilities under the GESCO Plan were transferred to the
Predecessor Plan in a transaction that complied with section 414(l) of the Code.
The Predecessor Plan generally included the provisions of the GESCO Plan that
were applicable prior to the effective date of the Predecessor Plan, which
provisions set out the benefits, rights, and features that applied with respect
to service under the GESCO Plan prior to the effective date of the Predecessor
Plan. For the individuals whose benefits were taken into account in the
determination of the transfer of assets and liabilities from the GESCO Plan to
the Predecessor Plan ("the GESCO Transferees"), "Compensation", "Credited
Service", and "Eligibility Service" under the Predecessor Plan include
compensation, credited service, and eligibility service under the terms of the
GESCO Plan for periods prior to the effective date of such transfer.
Intent and Construction:
The Plan is intended to comply with the qualification requirements of section
401(a) of the Code and applicable regulations and rulings thereunder, and shall
be construed in accordance with such intention.
The Plan is conditioned upon and subject to obtaining such approval of the
Commissioner of Internal Revenue as may be necessary to establish the
deductibility for income tax purposes of any and all contributions hereunder,
other than Employee contributions.
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SECTION 1 - DEFINITIONS
Whenever used in this Plan, masculine pronouns include both men and women unless
the context indicates otherwise. Wherever used in this Plan:
1. "Administrative Committee" means the person(s) appointed by the Company
as the "named fiduciary" of the Plan, within the meaning of section
402(a)(2) of ERISA, with respect to Plan administrative matters.
2. "Administrator" means the Company or such other person(s) designated by
the Company as responsible for Plan administration.
3. "Affiliated Entity" means a subsidiary company that is at least fifty
percent (50%) owned by the Company or a partnership or a joint venture
in which the Company is at least a fifty percent (50%) owner that has
not been designated as an Employer. The term Affiliated Entity shall
also include all entities in the Controlled Group of each Employer.
4. "Board of Directors" or "Board" means the Board of Directors of the
Company.
5. "Career Accumulation" means the amounts accumulated pursuant to
Subsection 4.A.1 of the Plan.
6. "Casual Employee" means a person who is hired either:
(a) for a predetermined limited period not to exceed three (3) months,
or
(b) for the purpose of completing a specific task that is anticipated
not to exceed five (5) months, and for whom the Employer has no
expectation of continued employment beyond the completion of that
task.
The determination of who is a Casual Employee shall be made on a
uniform and nondiscriminatory basis.
7. "Company" means Curtiss-Wright Corporation, a corporation organized
under the laws of the state of Delaware.
8. "Compensation" means (a) wages within the meaning of section 3401 (a)
of the Code and all other payments of compensation to an Employee by
the Employer (in the course of the Employer's trade or business) for
which the Employer is required to furnish the Employee a written
statement on Form W-2 under sections 6041(d), 6051(a)(3), and 6052 of
the Code; and (b) amounts contributed by the Employer pursuant to a
salary reduction agreement that are not includible in the gross income
of the Employee under sections 125, 402(e)(3), 402(h) of the Code and,
effective as of January 1, 2001, section 132(f) of the Code.
Notwithstanding the preceding sentence, the term Compensation shall
exclude the following: reimbursements or other expense allowances;
fringe benefits (cash or noncash); moving expenses; deferred
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compensation; welfare benefits; amounts paid under a long-term
incentive plan; and 50% of any annual incentive award paid under a
management incentive program. Effective as of January 1, 2001,
Compensation shall also exclude any retention bonus, suggestion award,
and other non-performance-related awards or bonuses.
For Plan Years beginning on or after January 1, 1989 but before
December 31, 1993, Compensation shall not exceed $200,000 (or such
greater amount as may be permitted by the Secretary of the Treasury or
his delegate).
For Plan Years beginning on or after January 1, 1994, the Compensation
taken into account under the Plan shall not exceed $150,000 as adjusted
by the Commissioner for increases in the cost of living in accordance
with section 401(a)(17)(B) of the Code. In addition, (i) with respect
to CBS Transferred Individuals (as defined in Subsection 1.12.C) for
the 1999 Plan Year, the Compensation taken into account under the
Predecessor Plan, when added to compensation taken into account under
the GESCO Plan (as defined in the Introduction to this Plan) for the
period from January 1, 1999 through March 31, 1999, shall not exceed
$160,000, and (ii) the Compensation taken into account under the
Predecessor Plan, when added to compensation previously earned during a
Plan Year from Westinghouse Electric Company LLC (or an at least
50%-owned subsidiary thereof), shall not exceed the limit described in
the preceding sentence in effect for such Plan Year.
For Plan Years beginning on or after January 1, 2002, the annual
compensation of each Participant taken into account under the Plan
shall not exceed $200,000, as adjusted for cost-of-living increases in
accordance with Section 401(a)(17)(B) of the Code. In determining
benefit accruals in Plan Years beginning on or after January 1, 2002,
the annual compensation limit described in this paragraph shall be
taken into account, for determination periods beginning before January
1, 2002.
For Plan Years beginning prior to January 1, 1997, in determining the
Compensation of an Employee for purposes of this limit, the rules of
section 414(q)(6) of the Internal Revenue Code shall apply, except in
applying such rules, the term "family" shall include only the spouse of
the Employee and any lineal descendants of the Employee who have not
attained age 19 before the close of the year. If, as a result of the
application of such rules, the adjusted annual compensation limit is
exceeded, then the limitation shall be prorated among the affected
individuals in proportion to each such individual's Compensation
determined under this Section prior to the application of this
limitation.
For "WGSC Transferees" as defined in the Introduction to this Plan,
Compensation for periods prior to the Effective Date shall include any
compensation credited under the Predecessor Plan prior to the Effective
Date. For "GESCO Transferees" as defined in the Introduction to this
Plan, Compensation for periods prior to January 1, 2000 shall include
any compensation credited under the GESCO Residual Pension Plan prior
to January 1, 2000.
9. "Controlled Group" means, with respect to an Employer:
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(a) any corporation which is a member of a controlled group of
corporations, within the meaning of section 1563(a) of the Code,
determined without regard to sections 1563(a)(4) and (e)(3)(C),
including such Employer;
(b) any trade or business under common control with such Employer,
within the meaning of section 414(c) of the Code;
(c) any employer which is included with such Employer in an affiliated
service group, within the meaning of section 414(m) of the Code; or
(d) any other entity required to be aggregated with such Employer
pursuant to regulations under section 414(o) of the Code.
For purposes of Appendix B, "more than fifty percent (50%)" shall be
substituted for "eighty percent (80%)" each place it appears in section
1563(a)(1) of the Code or section 1.414(c)-2 of the Income Tax
Regulations.
10. "Credited Service" means service which is used to determine pension
amounts. For periods on and after January 1, 1995, an Employee
(including a part-time Employee or Casual Employee) will not earn
Credited Service unless he had an election to contribute in effect for
such period, except to the extent provided in Subsections 3.E and 4.E.
Credited Service shall be based on the following:
A. For all Employees, except part-time Employees and Casual Employees
who are regularly scheduled to work less than 24 hours per week,
Credited Service means all periods of service as an Employee with
the Employer for which the Employer is directly or indirectly paid,
or entitled to payment, by the Employer for the performance of
duties, and time spent on any of the following (provided that, for
Casual Employees, only hours worked on or after October 1, 1997
shall be counted in determining Credited Service):
(1) furlough;
(2) disability up to a maximum continuous period of 2 years;
(3) leaves of absence (other than military leaves and leaves for
personal reasons including educational leaves) up to a maximum
of 6 years, except that, in the case of a leave of absence
continuing after December 31, 1994, no more than 2 years of
Credited Service will be granted under this provision unless,
prior to the expiration of such 2 year period, the Employee
demonstrates to the satisfaction of the Administrator that he
is expected to resume performing services for an Employer
immediately following the conclusion of such leave;
(4) military leaves of absence up to a maximum equal to that period
of time during which reemployment is required under applicable
Federal statutes; and
(5) Layoff up to a maximum continuous period of 1 year for any
Layoff that commenced on or after January 1, 1976.
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If while an Employee is on disability leave of absence under
Subsection 1.10.A.(2) above, he is laid off, he shall begin to
accrue Credited Service only under Subsection 1.10.A.(5) above from
that time and shall continue to be credited with Credited Service
under Subsection 1.10.A.(5) for up to 1 year; but in no event shall
the combined Credited Service under Subsections 1.10.A.(2) and
1.10.A.(5) exceed 2 years.
Credited Service shall be expressed in whole years and fractions
thereof. Any fraction of a year shall be expressed as a decimal
figure determined by completed months for the year divided by
twelve, plus completed days in any incomplete month divided by 365.
B. For part-time Employees and Casual Employees who are regularly
scheduled to work less than 24 hours per week, for any calendar
year each such Employee shall receive Credited Service which shall
be determined by dividing the number of hours worked in that
calendar year by 2,000, subject to a maximum of 1 full year,
provided that, for Casual Employees, only hours worked on or after
October 1, 1997 shall be counted in determining Credited Service.
For the purposes of this Subsection 1.10.B (and Subsection 1.12.B
and Subsection 1.12.E), hours worked shall mean: (i) each hour for
which an Employee is paid, or entitled to payment, for the
performance of duties for the Employer (which hours will be
credited to the calendar year in which the duties are performed);
(ii) each hour for which an employee is paid, or entitled to
payment, by the Employer on account of a period of time during
which no duties are performed due to vacation, holiday, illness,
incapacity (including disability), Layoff, jury duty, military duty
or leave of absence (provided that no more than 501 hours will be
credited for any single continuous period whether or not such
period occurs in a single calendar year, and that hours will be
calculated and credited pursuant to section 2530.200b-2 of the
Labor regulations); and (iii) each hour for which back pay,
irrespective of mitigation of damages, is either awarded or agreed
to by the Employer (which hours will be credited to the calendar
year to which the award or agreement pertains rather than the
calendar year in which the award, agreement, or payment is made),
excluding any hours credited under (i) or (ii) above.
For any Plan Year in which an Employee falls into both category A
above and this category B, he shall receive Credited Service under
the category, which is most advantageous to him.
C. Periods of employment in an Excluded Unit shall not count as
Credited Service.
D. A former Employee who is rehired by an Employer will be eligible
only for those benefits for which he was eligible at the time of
his prior separation under the Plan in effect at that time until
the earliest of the following occurs: (1) he has been re-employed
for at least 6 consecutive months; (2) he has reached his Normal
Retirement Date; (3) he has been Involuntarily Separated; or (4) he
elects early retirement because of a scheduled Layoff.
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E. For "WGSC Transferees" as defined in the Introduction to this Plan,
Credited Service for periods prior to the Effective Date shall
include any credited service credited under the Predecessor Plan
prior to the Effective Date. For "GESCO Transferees" as defined in
the Introduction to this Plan, Credited Service for periods prior
to January 1, 2000 shall include any credited service credited
under the GESCO Plan prior to January 1, 2000.
11. "Effective Date" means October 29, 2002.
12. "Eligibility Service" means service that is taken into account in
determining whether an Employee is a Vested Employee. Eligibility
Service shall be determined as follows:
A. For periods on or after January 1, 2002 for all Employees including
part-time Employees and Casual Employees, Eligibility Service means
all periods of service as an Employee (including as a leased
employee as defined in section 414(n)(2) of the Code) with the
Employer, an Affiliated Entity, or in an Excluded Unit for which
the Employee is directly or indirectly paid, or entitled to
payment, by the Employer for the performance of duties, and time
spent on any of the following:
(1) furlough;
(2) disability up to a maximum continuous period of 2 years;
(3) leaves of absence (other than military leaves and leaves for
personal reasons including educational leaves) up to a maximum
of 6 years, except that no more than 2 years of Eligibility
Service will be granted under this provision unless, prior to
the expiration of such 2 year period, the Employee demonstrates
to the satisfaction of the Administrator that he is expected to
resume performing services for an Employer immediately
following the conclusion of such leave;
(4) military leaves of absence up to a maximum equal to that period
of time during which re-employment is required under applicable
Federal statutes; and
(5) Layoff up to a maximum continuous period of 1 year.
If while an Employee is on disability leave of absence under
Subsection 1.12.A.(2) above, he is laid off, he shall begin to
accrue Eligibility Service only under Subsection 1.12.A.(5) above
from that time and shall continue to be credited with Eligibility
Service under Subsection 1.12.A.(5) for up to 1 year; but in no
event shall the combined Eligibility Service under Subsections
1.12.A(2) and 1.12.A.(5) exceed 2 years.
Eligibility Service shall be expressed in whole years and fractions
thereof. Any fraction of a year shall be expressed as a decimal
figure determined by completed months for the year divided by
twelve, plus completed days in any incomplete month divided by 365.
The Eligibility Service computation period
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Notwithstanding the foregoing, this Subsection 1.12.A shall not
start a new Eligibility Service computation period as of January 1,
2002 for any Employee other than a part-time Employee or Casual
Employee who is regularly scheduled to work less than 24 hours per
week.
B. (1) For periods before January 1, 2002, for any Employee other than
a part-time Employee or Casual Employee who is regularly
scheduled to work less than 24 hours per week, Eligibility
Service means all Credited Service, all service that would be
Credited Service except that the Employee elected not to
contribute, periods of employment with an Affiliated Entity or
in an Excluded Unit, and periods of employment as a leased
employee (as defined in section 414(n)(2) of the Internal
Revenue Code).
(2) For periods before January 1, 2002, for a part-time Employee or
Casual Employee who is regularly scheduled to work less than 24
hours per week, each such Employee shall receive 1 full year of
Eligibility Service for any calendar year in which he works at
least 1,000 hours (even if such Employee would earn less than 1
full year of Credited Service during such calendar year). If
such Employee works less than 1,000 hours in any calendar year,
his Eligibility Service shall equal his Credited Service for
that calendar year. For the purposes of this paragraph, hours
worked shall be determined under the second paragraph of
Subsection 1.10.B. (including periods of employment with an
Affiliated Entity or in an Excluded Unit, and periods of
employment as a leased employee (as defined in section
414(n)(2) of the Internal Revenue Code)).
For Plan Years beginning on or after January 1, 1976 and before
January 1, 1998, the case of a Casual Employee who later becomes an
Employee, such period shall receive 1 full year of Eligibility
Service for any calendar year in which he worked at least 1,000
hours as a Casual Employee.
For periods before January 1, 2002, for any Plan Year in which an
Employee falls into both category (1) and (2) above, he shall
receive Eligibility Service under the category, which is most
advantageous to him.
C. For any Employee (other than, for periods before January 1, 2002, a
part-time Employee or Casual Employee who is regularly scheduled to
work less than 24 hours per week):
(1) If the Employee is absent from service for any reason which
does not otherwise qualify him for Credited Service or
Eligibility Service under the Plan, and such absence is not due
to quit, discharge, release, retirement, or death, he shall
receive Eligibility Service of up to 1 year for any continuous
period of absence.
(2) If the Employee is separated from service by reason of a quit,
discharge, release, or retirement, and then is re-employed
within 12 months of the date he was separated, the Employee's
Eligibility Service
9
shall include the period between the date he was separated and
the date he was reemployed.
(3) Notwithstanding the provisions of (1) and (2) above, if, during
an absence from service of 12 months or less for any reason
other than a quit, discharge, release, or retirement, the
Employee is separated from service by reason of a quit,
discharge, release, or retirement and then is reemployed within
12 months of the date on which he was first absent from
service, the Employee's Eligibility Service shall include the
period between his last day worked and the date he returns to
work.
D. For an individual identified as a "business employee" in Section
5.5(a) of the Asset Purchase Agreement dated June 25, 1998 between
CBS Corporation and WGNH Acquisition, LLC relating to CBS
Corporation's Government and Environmental Services Business and
who commences employment with WGSC or an affiliated entity of WGSC
in connection with such agreement (a "CBS Transferred Individual"),
Eligibility Service for any period prior to commencement of
employment for WGSC or an affiliated entity of WGSC shall include
any eligibility service credited under the Westinghouse Pension
Plan, as in effect on March 31, 1999.
E. For an individual who is identified as an "Employee" in Section
3.15(a) of the Asset Purchase Agreement dated October 25, 2002
between WGSC and Curtiss-Wright Electro-Mechanical Corporation
relating to the purchase of certain assets related to WGSC's
Electro-Mechanical Division and who commences employment with the
Employer or an Affiliated Entity in connection with such agreement,
Eligibility Service for any period prior to commencement of
employment for the Employer or an Affiliated Entity of WGSC shall
include any eligibility service credited under the Predecessor, as
in effect on October 28, 2002.
F. For Employees who are not described in paragraphs D or E above,
Eligibility Service shall include any eligibility service credited
under the Westinghouse Pension Plan, excluding (1) service so
credited under the Westinghouse Pension Plan on account of service
for a subsidiary, division, or other business unit of Viacom, Inc.
(formerly CBS Corporation) that was not part of Westinghouse
Electric Corporation prior to November 24, 1995, and (2) service so
credited under the Westinghouse Pension Plan on account of service
for a former subsidiary, division, or other business unit of
Viacom, Inc. (formerly CBS Corporation) after such entity ceased to
be an employer or affiliated entity under the Westinghouse Pension
Plan.
G. Eligibility Service shall also include any service with (1)
Westinghouse Electric Company LLC (or any of its at least 50%-owned
subsidiaries), or (2) WGI (formerly Morrison Knudsen Corporation)
or any of its at least 50% owned subsidiaries, or (3) British
Nuclear Fuels plc, or any of its at least 50%-owned subsidiaries;
provided, however, that an individual who is a Pensioner or who has
received a distribution of his entire vested benefit under the Plan
shall not receive credit for Eligibility Service for any period of
employment with Westinghouse Electric Company LLC or British
Nuclear Fuels plc (or any of
10
their at least 50%-owned subsidiaries) unless and until such
individual, after becoming a Pensioner or receiving a distribution
of his entire vested benefit under the Plan, has an hour worked (as
defined in Subsection 1.10.B) for an Employer, Excluded Unit, or
Affiliated Entity.
H. Eligibility Service shall also include (i) all vesting service
granted to the Employee under a qualified retirement plan sponsored
and maintained by Washington Group International ("WGI") and (ii)
all vesting service that would have been granted to the Employee
under (i) above if the Employee had first been hired by WGI and
then transferred to employment covered by the Predecessor Plan.
Such Eligibility Service shall only be taken into account to the
extent the Employee has not otherwise received Eligibility Service
under the Predecessor Plan for the identical time period.
13. "Employee" means a person who is either (i) not represented by a labor
organization, or (ii) is represented by a labor organization or other
representative which has entered into a written agreement with an
Employer providing for participation in this Plan by the Employees in
such unit, provided:
(a) such person is in the service of an Employer, and he is not (i)
employed in an Excluded Unit, (ii) a Casual Employee prior to
October 1, 1997, nor a leased employee (as defined in section
414(n)(2) of the Internal Revenue Code), or (iii) employed in a
foreign jurisdiction and paid through a foreign payroll system; or
(b) such person is a citizen of the United States or a resident alien
(as defined in section 7701(b) of the Code) who is an employee
either of a domestic subsidiary (as defined in section 407 of the
Internal Revenue Code) or of a foreign subsidiary as to which the
Company has entered into an agreement under section 3121(l) of the
Internal Revenue Code and with respect to whom contributions under
a funded plan of deferred compensation (whether or not described in
section 401(a), 403(a), or 405(a) of the Internal Revenue Code) are
not provided by any person other than the Employer with respect to
the remuneration paid to the citizen or resident alien by the
domestic or foreign subsidiary.
14. "Employer" means (a) the Company, (b) an at least 50%-owned subsidiary
of the Company, or (c) an entity designated as an Employer in Appendix
D.
15. "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
16. "Excluded Unit" means any group, or other organizational unit, of
employees of the Company, other than (a) the Electro-Mechanical
Division of Curtiss-Wright Flow Control Corporation and (b) any group
or unit that has been designated by the Administrative Committee as
eligible to participate in this Plan. With respect to the Predecessor
Plan, Excluded Unit means all units of WGSC except for those units
designated by WGSC as eligible to participate in the Predecessor Plan.
17. "Flat Rate" means the method used for determining pension amounts as
described in Subsection 4.A.2 and Section 19 of the Plan.
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18. "Fiduciary" means the Company, other Employers, the Administrative
Committee, the Investment Committee, the Trustee, and the Investment
Managers, but only to the extent of those specific duties and
responsibilities allocated to each for Plan and Trust administration as
described in Section 12 and the Trust Agreement. No person or entity
shall function or be deemed to function as a fiduciary in connection
with actions affecting the design of the Plan, including, without
limitation, amendments, designations of participating Employers and
Excluded Units, and adoption of rules relating to acquisitions, sales
and other dispositions under Section 14.
19. "Frozen Credited Service" means an Employee's Credited Service for
periods prior to January 1, 1995,
20. "Frozen Early Retirement Pension" means, in the case of an Employee who
elects to retire early pursuant to Subsection 2.C, the monthly amount
payable under Subsection 5.A.1.(a) or the greater of the monthly amount
payable under Subsection 5.A.2.(a) or 5.A.2.(b), whichever applies,
taking into account all of the Employee's Eligibility Service, and
taking into account, in the case of early retirement prior to January
1, 1995, any amounts payable under Subsection 5.B.
21. "Frozen Normal Retirement Pension" means the greater of the monthly
amount payable under Subsection 4.A.1 or Section 19 to an Employee or
terminated Vested Employee solely as a result of his Frozen Credited
Service.
22. "Highly Compensated Employee" means any Employee who:
(1) was a 5% owner, as defined in section 416(b)(1)(B)(i) of the Code
at any time during the year or the preceding year, or
(2) for the preceding year had compensation from the Company or a
Controlled Group member in excess of $80,000. The $80,000 amount
is adjusted at the same time and in the same manner as under
section 415(d) of the Code, except that the base period is the
calendar quarter ending September 30, 1996.
For purposes of determining which Employees shall be deemed Highly
Compensated Employees, the applicable year of the Plan for which a
determination is being made is called a determination year and the
preceding 12-month period is called a look-back year.
A Highly Compensated Former Employee is determined based on the rules
applicable to determining Highly Compensated Employee status for the
determination year in which the Employee separated from service, in
accordance with section 1.414(q)-1T, Q&A-4 of the Income Tax
Regulations and IRS Notice 97-75.
23. "Hourly-Paid Employee" means a daywork or incentive Employee whose
basic Compensation the Employer computes and pays on an hourly rate.
24. "Internal Revenue Code" or "Code" means the Internal Revenue Code of
1986, as amended.
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25. "Investment Committee" means the person(s) that may be appointed by the
Company, in its discretion, as the "named fiduciary" of the Plan,
within the meaning of section 402(a)(2) of ERISA, with respect to Plan
investments.
26. "Investment Manager" means any Fiduciary:
(a) who has the power to manage, acquire, or dispose of any asset of
the Plan;
(b) who is (i) registered as an investment advisor under the Investment
Advisers Act of 1940; (ii) a bank, as defined in that Act; (iii) an
insurance company qualified to perform services described in
Subsection 1.25(a) under the laws of more than one State; or (iv) a
subsidiary of the Company authorized to perform investment
management services; and
(c) who has acknowledged in writing that he is a Fiduciary with respect
to the Plan.
27. "Joint Annuitant" means an individual designated by an Employee as
eligible to receive the survivor benefit provided by Subsection 10.C.3
or 10.C.4.
28. "Layoff" means the termination of the employment of an Employee with an
Employer through no fault of his own for lack of work for reasons
associated with the business where such Employer determines, on a
uniform and nondiscriminatory basis, there is a reasonable expectation
of recall within 1 year.
Notwithstanding the foregoing, a person who would otherwise be
considered to be on Layoff may take action, which would result in the
severance of his relationship with the Employer. At the time such
action is taken, that person shall become a voluntary quit and shall no
longer be considered on Layoff.
29. "Non-Vested Employee" means an Employee who has less than 5 years of
Eligibility Service.
30. "Normal Retirement Date" means, with respect to an Employee, the later
of (a) the first day of the month following his 65th birthday, or (b)
the first day of the month following his completion of 5 years of
Eligibility Service.
31. "PBGC" means the Pension Benefit Guaranty Corporation.
32. "Pensioner" means a person receiving a pension under the Plan, and
shall include any person with respect to whom liability for pension
payments was transferred from the Predecessor Plan to the Plan.
33. "Plan" means the Curtiss-Wright Electro-Mechanical Division Pension
Plan, as herein set forth or as hereafter amended.
34. "Plan Year" means the period beginning on October 29, 2002 ("the
Effective Date") and ending on December 31, 2002 and each calendar year
commencing on or after January 1, 2003. Notwithstanding the foregoing
sentence, for the purpose of determining the Compensation, Credited
Service, and Eligibility Service of an individual
13
who is identified as an "Employee" in Section 3.15(a) of the Asset
Purchase Agreement dated October 25, 2002 between Curtiss-Wright
Electro-Mechanical Corporation and WGSC providing for the purchase of
certain assets related to WGSC's Electro-Mechanical Division and who
commences employment with the Employer or an Affiliated Entity in
connection with such agreement, the calendar year beginning on January
1, 2002 shall be deemed to be a Plan Year, and for the purpose of
determining the Compensation, Credited Service, and Eligibility Service
for WGSC Transferees, as defined in the Introduction to the Plan, each
plan year of the Predecessor Plan shall be taken into account.
35. "Predecessor Plan" means the Westinghouse Government Services Group
Pension Plan, as in effect on the day prior to the Effective Date. To
the extent that the Predecessor Plan took account of the provisions of
the GESCO Plan in determining the benefits payable to participants
thereunder, the GESCO Plan shall also be deemed to be a Predecessor
Plan.
36. "Salaried Employee" means an Employee whose basic Compensation the
Employer computes and pays on a weekly or monthly rate.
37. "Surviving Spouse" means the spouse of an Employee or former Employee
on the earlier of the date he dies or becomes a Pensioner or a former
spouse named as a Surviving Spouse pursuant to a Qualified Domestic
Relations Order as defined in Subsection 17.A.
38. "Trust Agreement" means the agreement, or agreements, as from time to
time amended, which constitute a part of the Plan under which the
assets of the Plan are held in trust.
39. "Trustee" means the corporation or individual appointed by the
Investment Committee to hold the assets of the Plan in trust pursuant
to the Trust Agreement.
40. "Vested Employee" means an Employee who has completed 5 years or more
of Eligibility Service, or a former Employee who satisfied the vesting
requirements of the Plan or the Predecessor Plan which were in effect
at the time he ceased to accrue Eligibility Service, provided this
sentence shall be effective September 1, 1988.
41. "With Interest" means interest compounded annually computed from the
end of the calendar year in which contributions have been made to the
first of the month in which a computation is being made, at the
following rates: (i) for Plan Years beginning before 1976, at the
annual rate prescribed by the Predecessor Plan as in effect for such
Plan Years; (ii) for Plan Years beginning after 1975 and before 1988,
at the annual rate of 5%; (iii) for Plan Years beginning after 1987 and
before the date benefits commence, at the annual rate of 120% of the
Federal mid-term rate (as in effect under section 1274 of the Code for
the first month of the Plan Year); and (iv) for periods beginning when
benefits commence until the Normal Retirement Date, at the annual rate
which would be used under the Plan under section 417(e)(3) of the Code
and section 1.417(e)-1 of the Income Tax Regulations in effect as of
the date benefits commence.
14
SECTION 2 - ELIGIBILITY FOR RETIREMENT
A. An Employee's Normal Retirement Date is defined in Subsection 1.30. The
pension of any Employee is nonforfeltable if such Employee is alive on
his Normal Retirement Date.
B. Any person who is accruing Eligibility Service on the day preceding his
Normal Retirement Date may retire with a Normal Retirement Pension
pursuant to Section 4 on his Normal Retirement Date or on the first day
of any month following his Normal Retirement Date.
C. Any person who is accruing Eligibility Service and (i) is at least age
60 and has completed 10 or more years of Eligibility Service or (ii) is
at least age 58 and has completed 30 or more years of Eligibility
Service may elect to retire and receive an Early Retirement Pension
pursuant to Section 5 on the first day of any month thereafter up to
his Normal Retirement Date. Subsections 19.D and 19.E set out
additional circumstances under which a person may receive an Early
Retirement Pension.
D. No person who is working for an Affiliated Entity, or a successor
employer with whom the Company has entered into a reciprocal service
agreement may elect an Early Retirement Pension under this Plan which
commences prior to the date he ceases to be employed by such Affiliated
Entity, or successor employer.
E. All applications for Normal Retirement Pensions and Early Retirement
Pensions must be submitted in writing in accordance with such
procedures as the Administrator shall prescribe prior to the
applicant's desired retirement date. No pensions shall be payable for
any period prior to the elected retirement date.
F. Notwithstanding any other provision of this Plan to the contrary, a
Vested Employee's pension or any death benefit payable under Subsection
7.D shall commence, at the election of the Vested Employee, no later
than the 60th day after the latest of the close of the Plan Year in
which (i) the Vested Employee or the Beneficiary, as applicable,
attains age 65, (ii) the 10th anniversary of the year in which the
Vested Employee commenced participation occurs, or (iii) the Vested
Employee terminates his service with the Employer and any other
Controlled Group member.
15
SECTION 3 - ELIGIBILITY AND EMPLOYEE CONTRIBUTIONS
All Employees are eligible to participate in the Plan and to elect to make
contributions thereunder.
A. Each Employee may elect to make contributions and to accrue a monthly
pension in accordance with the formulas described in Subsections 4.A.1
and 4.A.2.
B. An Employee with an election to contribute in effect shall contribute 1
1/2% of his Compensation. The most recent contribution election under
the Predecessor Plan of a WGSC Transferee (as defined in the
Introduction to the Plan) who was eligible to participate in the
Predecessor Plan prior to such individual's transfer to an Employer
shall remain in effect under the Plan (subject to Subsection 3.C).
C. All elections to contribute shall become effective immediately for an
Employee who is hired or rehired, provided, however, that an election
previously in effect shall be reinstated if the Employee is rehired in
the same calendar year. An Employee who has waived his right to
contribute shall nevertheless have the right, effective on a succeeding
January 1, to elect to contribute.
D. This Subsection 3.D applies prior to January 1, 1995 to an Employee who
was disabled or on a leave of absence (including a military leave).
Such an Employee who had elected to contribute and who was on a leave
of absence or absent from work due to disability for at least a month
was, for as long as he continued to accrue Credited Service pursuant to
Subsection 1.10, eligible to make contributions to the Plan. Such
contributions were payable monthly based on his rate of Compensation in
effect immediately preceding the first payroll period for which he did
not receive a regular paycheck. Contributions for any calendar month
were required to be made no later than the 15th day of the following
month. If such an Employee at any time during his leave of absence or
disability elected not to continue to make contributions, he was not
permitted to start contributions again until he returned to work. If
such an Employee elected not to contribute as described above, he
nevertheless continued to be considered a contributing Employee for the
purpose of Subsection 4.A.2.
E. This Subsection 3.E applies on and after January 1, 1995 to an Employee
who is disabled or on a leave of absence (including a military leave)
and not receiving Compensation. Such an Employee shall not make
contributions to this Plan for the period of such disability or leave
of absence. If such an Employee had an election to contribute in effect
immediately prior to becoming disabled or beginning his leave of
absence, he shall, for as long as he would have continued to accrue
Credited Service if he were still contributing, nevertheless be deemed
to have an election to contribute in effect for purposes of Subsections
4.A.1.(c) and 4.A.2 during his period of disability or leave of
absence, and his Compensation shall be deemed to be equal to his
Compensation in effect immediately preceding the first payroll period
for which he did not receive a regular paycheck; provided, however,
that for any such Employee other than an Employee on military leave,
1 1/2% of Compensation shall be substituted for two 2% of Compensation
with respect to such imputed Credited Service in Subsection 4.A.1(c).
16
F. No withdrawals of Employee contributions shall be permitted while an
Employee continues to accrue Eligibility Service under the Plan.
Refunds of Employee contributions shall be made under certain
circumstances as described in Section 7.
17
SECTION 4 - NORMAL RETIREMENT PENSION
A. An Employee who retires on or after his Normal Retirement Date shall be
eligible for a monthly pension payable for his lifetime, which shall be
the greater of the amount he has accumulated under the Career
Accumulation method, or the Flat Rate method as described below.
1. An Employee's accumulated pension under the Career Accumulation
method shall be the sum of (a), (b), and (c) below.
(a) For calendar years prior to 1992, the Career Accumulation
amount for an Employee who retires on or after January 1, 1992
shall be:
(1) The greater of:
(i) any amounts earned as of December 31, 1991 under the
Career Accumulation method of the Basic Portion of the
Predecessor Plan as it existed prior to January 1, 1992
(see paragraph A of Appendix C),
or
(ii) any amounts earned as of December 31, 1991 under the
Final Average Compensation Method of the Basic Portion
of the Predecessor Plan as it existed prior to January
1, 1992 (see paragraph B of Appendix C),
plus
(2) Any amounts earned as of December 31, 1991 under the
Supplemental Portion of the Predecessor Plan as it existed
prior to January 1, 1992 (see paragraph C of Appendix C).
(b) For each of the years 1992, 1993, and 1994, if the Employee had
an election to contribute in effect, the monthly Career
Accumulation amount shall be 1/12 of 2% of Compensation for
that year, subject to a minimum of $15 for each such year of
Credited Service. If the Employee had elected to waive his
right to contribute for such year, the monthly Career
Accumulation amount shall be $15 for each such year of Credited
Service.
(c) For each year of Credited Service after December 31, 1994, for
an Employee who has an election to contribute in effect for a
Plan Year, the Employee's monthly accumulated pension under the
Career Accumulation method shall be the sum of 1/12 of 2% of
Compensation for that Plan Year; provided, however, that in no
event shall such an Employee's monthly accumulated pension
under the Career
18
Accumulation method for a Plan Year be less than $31.00
multiplied by the Participant's Credited Service for such Plan
Year. An Employee's monthly accumulated pension for a year
under the Career Accumulation method shall be zero, if the
Employee has elected to waive his right to contribute for such
year, except as provided in Subsections 3.E and 4.E
2. An Employee's accumulated pension under the Flat Rate method shall
be determined under (a) or (b) below, whichever applies.
(a) For Employees who do not have Eligibility Service after
December 31, 1994, the accumulated pension under the Flat Rate
method shall be the amount determined under Section 19.
(b) For Employees who have Eligibility Service after December 31,
1994, the accumulated pension under the Flat Rate method shall
be the sum of (1), (2), and (3) below:
(1) If the Employee elected to make contributions when he was
first eligible to do so, his Flat Rate method monthly
pension amount for all Credited Service accumulated prior
to the first date such an election could have been
effective shall be equal to the product of $31.00 times the
applicable years of Credited Service. If the Employee
elected not to make contributions when he was first
eligible to do so, his Flat Rate method monthly pension
amount for all Credited Service accumulated prior to the
first date such an election could have been effective shall
be equal to the product of $13.00 times the applicable
years of Credited Service.
(2) $31.00 for each year of Credited Service in which the
Employee had an election to contribute in effect or is
treated as having an election to contribute in effect under
Subsections 3.D, 3.E, and 4.E.
(3) $13.00 for each year of Credited Service prior to January
1, 1995 in which the Employee was eligible to contribute
but elected not to contribute.
(c) For each year of Credited Service after December 31, 1994, the
monthly Flat Rate amount shall be zero, if the Employee has
elected to waive his right to contribute for such year except
as provided in Subsections 3.E and 4.E.
B. In no event shall the monthly pension computed pursuant to Subsection
4.A above be less than the monthly annuity payable as of the Employee's
retirement date that is the actuarial equivalent of the annuity
equivalent of the Employee's contributions, With Interest. Such annuity
equivalent and actuarial equivalence shall be computed based on the
mortality table and interest rate assumptions provided under Subsection
10.J.
19
C. For an individual who is an Employee after his Normal Retirement Date,
in no event shall the monthly pension computed pursuant to Subsection
4.A above be less than:
1. the amount computed under Subsection 4.A for an Employee at his
Normal Retirement Date based on the provisions of the Plan in
effect at his Normal Retirement Date, minus
2. the Employee's contributions, With Interest, under the Plan at his
Normal Retirement Date, multiplied by a conversion factor based on
his age at his Normal Retirement Date, plus
3. the Employee's contributions, With Interest, under the Plan at his
actual retirement date, multiplied by a conversion factor based on
his age at his actual retirement date.
The conversion factors referred to herein shall be based on the
mortality table and interest rate assumptions provided under Subsection
10.J.
D. 1. A Vested Employee who continues to be employed by an Employer after
attaining age 70 1/2 shall commence distributions on April I of the
year following the later of the year in which he attains age 70
1/2 or retires (or, for a 5% owner, within the meaning of Internal
Revenue Code section 416(i), the year in which he attains age 70
1/2), in accordance with the provisions of Internal Revenue Code
section 401(a)(9) and the regulations promulgated thereunder,
including the minimum distribution incidental benefit requirement
of section 1.401(a)(9)-2 of the Income Tax Regulations, as
promulgated on April 17, 2002, which regulation is incorporated
herein by reference.
2. A Vested Employee who reached age 70 1/2 before January 1, 2001 may
elect, in accordance with uniform and nondiscriminatory procedures
determined by the Administrative Committee, to begin distributions
no later than April 1 of the year following the year in which he
attains age 70 1/2. Such pension shall be computed in accordance
with Subsection 4.A above based on Credited Service accrued to such
April 1 and shall be payable in accordance with the form of payment
described in Subsection 10.C.1. As soon as practical following each
January 1 thereafter, until such time as the Employee either
retires or dies, his pension shall be redetermined, taking into
account his additional Credited Service, additional benefits
determined under this Section 4, and any Plan amendments which have
become effective, and such redetermined amount shall be payable
each month of the ensuing year, retroactive to January 1 of such
year.
3. The benefit of any Vested Employee who continues in the employment
of an Employer and does not elect to begin distributions following
age 70 1/2 under, paragraph 2 above shall be actuarially increased
for the period beginning on April 1 following the calendar year in
which the Participant attained age 70 1/2 and ending on the date
benefits commence. The actuarially increased benefit shall be the
actuarial equivalent of the Participant's pension payable on April
1 following the calendar year in which the Participant attained age
70 1/2, plus the
20
actuarial equivalent of additional benefits accrued after that
date, reduced by the actuarial equivalent of any distributions made
after that date.
4. If an Employee dies after the time when distributions are
considered to have commenced in accordance with section 401(a)(9)
of the Internal Revenue Code, any remaining portion of the
Employee's benefits will be distributed at least as rapidly as
under the distribution method being used under section
401(a)(9)(A)(ii) of the Internal Revenue Code as of the Employee's
death.
E. For periods on and after January 1, 1995, an Employee shall earn no
less than $31 under Subsections 4.A.1.(c) and 4.A.2 for each year of
Credited Service while on furlough, disability, leave of absence
described in Subsection 1.10.A.(3), military leave of absence, or
Layoff, if the Employee had an election to contribute in effect
immediately prior to such status.
F. In the case of a Vested Employee who previously terminated employment
and received a lump sum distribution of only his contributions, With
Interest, if such Employee is rehired his pension shall be computed
under this Section 4 by first computing the pension to which he would
be entitled based on his total Credited Service as if he had not
withdrawn his contributions, With Interest, and then offsetting a
monthly amount equal to the amount that was deemed to have been
purchased by his contributions, With Interest, at the time of his
initial withdrawal in accordance with the terms of the Plan in effect
at such time.
21
SECTION 5 - EARLY RETIREMENT PENSION
A. The monthly pension amount payable for the lifetime of an Employee who
elects to retire early pursuant to Subsection 2.C shall be determined
as follows:
1. If the Employee has at least 30 years of Eligibility Service on his
retirement date, his pension shall be the greater of:
(a) the greater of the amount determined pursuant to Subsection
4.A.1 or Section 19 based on his Frozen Credited Service,
reduced by 0.25% for each month by which his retirement date
precedes the first day of the month following his 60th
birthday; or
(b) the amount determined pursuant to Subsection 4.A based on all
of his Credited Service, reduced by 0.50% for each month by
which his retirement date precedes his Normal Retirement Date.
Subsection 10.M modifies the above reduction factors in the case of
certain retirements after 1994 where a monthly annuity is elected.
2. If the Employee has less than thirty (30) years of Eligibility
Service on his retirement date, his pension shall be the greatest
of:
(a) the amount determined pursuant to Subsection 4.A.1 based on his
Frozen Credited Service, reduced by 0.33% for each month by
which his retirement date precedes his Normal Retirement Date;
(b) the amount determined pursuant to Section 19 based on his
Frozen Credited Service; or
(c) the amount determined pursuant to Subsection 4.A based on all
of his Credited Service, reduced by 0.50% for each month by
which his retirement date precedes his Normal Retirement Date.
Subsection 10.M modifies the above reduction factors in the case of
certain retirements after 1994 where a monthly annuity is elected.
B. If the Employee retired before January 1, 1995 and prior to the first
day of the month following his 62nd birthday, he shall receive a
monthly early retirement supplement of $10.00 multiplied by his
Credited Service to his retirement date. This early retirement
supplement shall be payable up to and including the month he attains
age 62.
Subsection 10.M extends this provision in the case of certain
retirements after 1994 where a monthly annuity is elected. In the case
of early retirement (or special retirement treated as an early
retirement under Subsections 19.D and 19.E) prior to January 1, 1995
where the lump sum option of Subsection 10.C.5 is elected, this early
retirement supplement will be included in such lump sum.
22
C. In no event shall the monthly pension computed pursuant to Subsection
5.A above be less than the monthly annuity payable as of the Employee's
retirement date that is the actuarial equivalent of the Employee's
contributions, With Interest. Such annuity equivalent and actuarial
equivalence shall be computed based on the mortality table and interest
rate assumptions provided under Subsection 10.J.
D. The monthly pension amount of an Employee who defers his elected
retirement date beyond the first day of the month following the date he
ceases to accrue Eligibility Service shall be calculated at his elected
retirement date based on the Plan provisions which were in effect on
the first day of the month following the date he ceased to accrue
Eligibility Service.
E. In no event shall the monthly pension computed pursuant to Subsection
5.A above be less than the Career Accumulation amount determined
pursuant to Subsection 4.A.1.(a) as of December 31, 1991.
23
SECTION 6 - VESTED PENSION
A. Any Vested Employee who terminates service with an Employer, Affiliated
Entity, or Excluded Unit, for any reason, and is not eligible to
receive a Normal, Early, or Special Retirement Pension shall, subject
to Section 15, be entitled to receive a Vested Pension commencing on
his Normal Retirement Date. Such pension shall be payable in the normal
form described in Subsections 10.A and 10.B, whichever is applicable,
unless he elects an optional form of payment as described in Subsection
10.C. The amount of the Vested Pension shall be determined in the same
manner as the Normal Retirement Pension described in Section 4 and
shall be based on the terms of the Plan in effect on the date the
Employee ceases to accrue Eligibility Service under the Plan. For the
purpose of determining any amounts pursuant to Subsection 4.A.2, the
Employee shall be considered retired on the date he ceases to accrue
Eligibility Service under the Plan.
B. A Vested Employee who is eligible to receive a Vested Pension may,
subject to Section 15, elect to have his Vested Pension begin as early
as the first of the month following his 60th birthday if he has 10 or
more years of Eligibility Service. If a Vested Employee has 30 or more
years of Eligibility Service, he may, subject to Section 15, elect to
have his Vested Pension begin as early as the first of the month
following his 58th birthday. In either case, the Vested Pension shall
be reduced by 0.50% per month for each month that his elected pension
starting date precedes his Normal Retirement Date.
C. A Vested Employee who terminates service with an Employer, Affiliated
Entity, or Excluded Unit, for any reason, who is not eligible to
receive a Normal, Early, or Special Retirement Pension, and who has not
satisfied the age and service requirements for the commencement of his
Vested Pension pursuant to Subsection 6.B above may, subject to Section
15, elect to receive a lump sum. Such lump sum shall be subject to the
limitations of Subsection 10.C.5, computed in accordance with
Subsections 10.I and 10.J, and subject to the election and spousal
consent rules of Section 10. Upon reemployment, a Vested Employee who
received a lump sum cashout of his entire interest in this Plan shall
not be permitted to return the amounts received to the Plan. In such
event, the benefits of the former Employee shall be determined without
regard to service for which he received a lump sum, but his previous
Eligibility Service shall be restored for determining such Employee's
eligibility for benefits.
D. A Vested Employee who terminates service with an Employer, Affiliated
Entity, or Excluded Unit, for any reason, who is not eligible to
receive a Normal, Early or Special Retirement Pension, and who has not
satisfied the age and service requirements for the commencement of his
Vested Pension pursuant to Subsection 6.B above, may, subject to
Section 15, elect to receive a reduced monthly pension as early as the
first of the month following the date he ceases to accrue Eligibility
Service under the Plan. Such a Vested Employee may elect either to
receive his entire benefit, or his remaining benefit (if any) after
election of a lump sum pursuant to Subsection 6.C above, in the form of
a monthly pension. In either case, the monthly pension amount shall be
the equivalent actuarial value of the pension (or remaining pension in
the event a portion of the pension is paid in a lump sum) described in
Subsection 6.A. The monthly pension shall be payable in the form
described in Subsections 10.A or 10.B, whichever
24
is applicable, unless the Employee elects an optional form of payment
as described in Subsection 10.C. For purposes of this Subsection 6.D,
equivalent actuarial value shall be based on the Vested Employee's age
and using the actuarial assumptions specified in Subsection 10.J.
E. Notwithstanding any other provision of the Plan, if an Employee
terminates service with an Employer, Affiliated Entity, or Excluded
Unit and if both the lump sum value of an Employee's entire Vested
Pension from the Plan calculated in accordance with Subsections 10.I
and 10.J and the Employee's contributions, With Interest, are equal to
or less than $5,000, then the greater of such lump sum amount or such
contributions, With Interest, shall, subject to Section 15, be paid
automatically to the Vested Employee and no further payments shall be
due from the Plan.
25
SECTION 7 - REFUNDS OF EMPLOYEE CONTRIBUTIONS
A. If a Non-Vested Employee who has made contributions under the Plan
terminates employment, there shall be payable to him an amount equal to
the sum of his contributions, With Interest. Notwithstanding the
foregoing, no refund shall be made to any Employee until such Employee
ceases to accrue Eligibility Service under the Plan. If the amount
payable to an Employee is $5,000 or more, the Employee must request
payment in writing and must obtain the written consent of his spouse.
Spousal consent must be witnessed by a notary public.
B. If the amount payable to a Non-Vested Employee under Subsection 7.A is
greater than $5,000, the Non-Vested Employee may elect to receive a
reduced monthly pension in lieu of a refund as early as the first of
the month following the date he ceases to accrue Eligibility Service
under the Plan. In that case, the monthly pension amount shall be the
equivalent actuarial value of his contributions, With Interest. Such
pension shall be payable in the form described in Subsections 10.A or
10.B, whichever is applicable, unless the Employee elects an optional
form of payment as described in Subsection 10.C. For purposes of this
Subsection 7.B, the equivalent actuarial value shall be based on the
Employee's age, and the mortality table and interest rate assumptions
provided under Subsection 10.J.
C. If a Non-Vested Employee who received a payment of his contributions,
With Interest, under the Plan due to termination of employment is
reemployed as an Employee or an employee of an Affiliated Entity or
Excluded Unit, he may at any time within five years following his
return to service as an Employee or an employee of an Affiliated Entity
or Excluded Unit repay the total amount paid to him at the time his
services were terminated and thereby have the pension restored which he
had earned under the Plan up to the date his services were terminated.
If he does not make such repayment, his pension for service prior to
the date of his previous termination will be calculated as described in
Subsection 4.A for an Employee who never elected to contribute under
the Plan.
D. Subject to Subsection 10.O, if an Employee or a former Employee who has
made contributions under the Plan dies before the date pension payments
commence and he has no spouse, or his spouse is not entitled to a
Surviving Spouse Benefit under Sections 8 or 9, there shall be payable
to a Beneficiary named by the Employee an amount equal to his
contributions, With Interest. If no valid Beneficiary designation is on
file pursuant to Section 11, payment shall be made to the legal
representative of the Employee or former Employee.
E. In no event shall payments made from the Plan be less than the
Employee's contributions, With Interest.
F. If a Non-Vested Employee (i) terminates employment and receives a
refund of his contributions to this Plan under this Section 7 or (ii)
elects not to contribute to this Plan and terminates employment, he
will be deemed to have received a total distribution of his accrued
benefit under this Plan.
26
SECTION 8 - SURVIVING SPOUSE BENEFIT FOR DEATH BEFORE RETIREMENT
A. If an Employee who is accruing Eligibility Service dies after (a)
attaining age 50 and completing 15 years of Eligibility Service, (b)
attaining age 60 and completing 10 years of Eligibility Service, or (c)
completing 25 years of Eligibility Service, or if an Employee dies who
on his date of death was eligible for an immediate pension pursuant to
the provisions of the Plan, a benefit shall be paid to his Surviving
Spouse. This Section 8 shall also apply to the Surviving Spouse of an
Employee who continued in the employ of an Employer beyond his Normal
Retirement Date. This Section 8 shall not apply to a terminated vested
Employee who is entitled to receive a Vested Pension under Section 6.
This Section 8 is subject to Subsection 10.O.
B. The benefit payable to the Surviving Spouse pursuant to this Section 8
shall be a monthly benefit payable for the life of the Surviving
Spouse. Such benefit shall commence on the first of the second month
following the month in which the Employee's death occurred. The first
payment will include a benefit for both such second month and the first
month following the month in which the Employee's death occurred.
C. The amount of the monthly benefit shall be the amount calculated below,
reduced by a percentage determined in accordance with Subsection 10.D
based on the difference between the Employee's age and the age of the
Surviving Spouse on the first of the month following the month in which
the Employee's death occurred, and then multiplied by 55%.
1. If the Employee had less than 30 years of Eligibility Service
on his date of death, the calculated amount shall be the
greatest of.
(a) the amount determined pursuant to Subsection 4.A.1
based on his Frozen Credited Service, reduced by
0.33% for each month by which the first of the month
following the month in which he died precedes his
Normal Retirement Date (subject to a maximum
reduction of 20%);
(b) the amount determined pursuant to Section 19 based on
his Frozen Credited Service; or
(c) the amount determined pursuant to Subsection 4.A
based on all of his Credited Service, reduced by
0.50% for each month by which the first of the month
following the month in which he died precedes his
Normal Retirement Date (subject to a maximum
reduction of 42%).
Subsection 10.M modifies the above reduction factors in
certain cases where the Surviving Spouse elects a monthly
annuity.
2. If the Employee had 30 or more years of Eligibility Service on
his date of death, the calculated amount shall be the greater
of:
27
(a) the greater of the amount determined pursuant to
Subsection 4.A.1 or Section 10 based on his Frozen
Credited Service; or
(b) the amount determined pursuant to Subsection 4.A
based on all of his Credited Service-, reduced by
0.50% for each month by which the first of the month
following the month in which he died precedes his
Normal Retirement Date (subject to a maximum
reduction of 42%).
Subsection 10.M modifies the above reduction factors in
certain cases where the Surviving Spouse elects a monthly
annuity.
D. The Beneficiary named by the Surviving Spouse shall be paid in a lump
sum the greater of the following two amounts; provided, however, that
if both such amounts are less than or equal to zero, no additional
amount shall be paid:
1. If the Surviving Spouse commences to receive a monthly
Surviving Spouse Benefit pursuant to this Section 8 and such
Surviving Spouse dies before a total of 60 monthly payments
have been received, the balance of such 60 monthly payments.
2. If a Surviving Spouse who is entitled to receive a Surviving
Spouse Benefit pursuant to this Section 8 dies before
receiving total payments, which are equal to or greater than
the Employee's contributions, With Interest, the difference
between such contributions, With Interest, and the amount
previously received.
If no valid Beneficiary designation is on file pursuant to Section 11,
any amounts payable shall be paid to the legal representative of the
Surviving Spouse.
E. In lieu of a monthly benefit payable as described in Subsection 8.B
above, the Surviving Spouse may elect a lump sum. Such lump sum shall
be subject to the limitations of Subsection 10.C.5 and computed in
accordance with Subsections 10.I and 10.J.
28
SECTION 9 - SURVIVING SPOUSE BENEFIT FOR CERTAIN VESTED EMPLOYEES
A. This Section 9 shall apply to the Surviving Spouse of any Vested
Employee who dies, provided such Vested Employee ceased accruing
Eligibility Service on or after January 1, 1976 and provided further
that such Vested Employee neither:
1. satisfies the requirements for the Surviving Spouse benefit
described in Section 8, nor
2. has commenced receiving a pension under this Plan at the time of his
death.
B. The benefit payable to the Surviving Spouse pursuant to this Section 9
shall be a monthly benefit payable for the life of the Surviving
Spouse. Such benefit shall commence on the first of the month following
the month requested by the Surviving Spouse for the commencement of
payments, but in no event later than the Vested Employee's Normal
Retirement Date or earlier than the first of the month following the
month in which the Vested Employee would have attained:
1. age fifty eight 58, if he had thirty (30) or more years of
Eligibility Service;
2. age 60 if he had ten 10 or more but less than 30 years of
Eligibility Service; or
3. age 65 if he had less than 10 years of Eligibility Service.
The first payment will include a benefit for both the month requested
by the Surviving Spouse for the commencement of payments, and the
following month during which the first payment is made.
C. The amount of the monthly benefit payable to the Surviving Spouse shall
be the Vested Employee's Vested Pension, which shall be calculated in
the same manner as the Normal Retirement Pension described in Section 4
based on the terms of the Plan in effect on the date the Employee
ceases to accrue Eligibility Service, reduced by:
1. 0.50% for each month that the starting date precedes the
Vested Employee's Normal Retirement Date; and
2. a percentage determined in accordance with Subsection 10.D
based on the difference between what the Vested Employee's age
would have been on the payment commencement date and the
Surviving Spouse's age on that date;
and then multiplied by 55%.
D. In lieu of a monthly benefit pavable as described in Subsection 9.C
above, the Surviving Spouse may elect a lump sum. Such lump sum shall
be subject to the limitations of Subsection 10.C.5 and computed in
accordance with Subsections 10.I and 10.J.
29
E. In the event that both the value of the monthly benefit described in
Subsection 9.C above, computed in accordance with Subsections 10.I and
10.J, and the Vested Employee's contributions, With Interest, at the
time of the Vested Employee's death are equal to or less than $5,000,
the greater of such value or such contributions, With Interest, shall
be paid to the Surviving Spouse in a lump sum in lieu of any monthly
payments under the Plan.
F. In the event that either the value of the monthly benefit described in
Subsection 9.C above, computed in accordance with Subsections 10.I and
10.J, or the Vested Employee's contributions, With Interest, at the
time of the Vested Employee's death shall be greater than $5,000, the
Surviving Spouse may elect, at any time prior to satisfying the
requirements for commencement of a pension set forth in Subsection 9.B
above, to receive a lump sum. Such lump sum shall be subject to the
limitations of Subsection 10.C.5 and computed in accordance with
Subsections 10.I and 10.J. Such lump sum shall be the greater of the
value of the benefit described in Subsection 10.C.5 or the Vested
Employee's contributions, With Interest, both determined as of the
elected payment date. This Subsection 9.F shall not apply unless the
Surviving Spouse is alive on such elected payment date.
G. A Surviving Spouse who has not yet satisfied the requirements for
commencement of a pension set forth in Subsection 9.B above, may elect
to receive a reduced monthly pension as of the first of any month. The
Surviving Spouse may elect either to receive his entire benefit, or his
remaining benefit (if any) after election of a lump sum pursuant to
Subsection 9.F above, in the form of a monthly pension. In either case,
the monthly pension amount shall be the equivalent actuarial value of
his pension at his Normal Retirement Date determined in Subsection 9.C
above (or the remainder). The monthly pension shall be payable on a
life annuity basis. The equivalent actuarial value shall be determined
using the assumptions described in Subsection 10.J, based on the
Surviving Spouse's age.
H. If a Surviving Spouse who is entitled to receive a Surviving Spouse
Benefit pursuant to this Section 9 dies before receiving total payments
which are equal to or greater than the Vested Employee's contributions,
With Interest, the difference between such contributions, With
Interest, and the amount previously received, shall be paid in a lump
sum to a Beneficiary named by the Surviving Spouse. If no valid
Beneficiary designation is on file pursuant to Section 11, any amounts
payable shall be paid to the legal representative of the Surviving
Spouse.
30
SECTION 10 - FORM OF PENSION PAYMENTS
For purposes of this Section 10, the term Employee shall include a Vested
Employee.
A. The normal form of pension payment (not including any early retirement
supplements provided by this Plan) shall be a 55% spouse survivor
annuity, which shall be a reduced amount payable monthly for the
Employee's life with the provision that upon his death 55% of such
reduced amount shall be paid for the life of his Surviving Spouse. The
Administrator shall provide no less than 30 days and no more than 90
days prior to an Employee's retirement date, a written explanation, in
non-technical language, of the financial effect of the normal form on
his retirement income. In order for a married Employee to elect a form
of payment other than a 55% spouse survivor annuity or a 100% spouse
survivor annuity, such Employee must obtain the written consent of his
spouse. Such consent must be witnessed by a notary public. Any consent
of a spouse pursuant to this Subsection 10.A shall be effective only
with respect to such spouse. Notwithstanding the foregoing, if an
Employee establishes to the satisfaction of the Administrative
Committee that a written consent cannot be obtained because the spouse
cannot be located, or because of such other circumstances as may be
permitted by law, spousal consent shall not be required. All benefit
payments under this Section 10 shall commence on the first of the month
following the Employee's retirement date, and, if an annuity payment
option is chosen, the first payment will include a benefit for both
such month and the month that includes the Employee's retirement date.
Any consent (or establishment that consent is not required) necessary
under this provision will be valid only with respect to such spouse,
but may not be revoked by such spouse. A revocation of a prior waiver
may be made by an Employee without the consent of the spouse at any
time before the Employee's retirement date. The number of revocations
by an Employee shall not be limited. Any new waiver or change of
Beneficiary will require a new spousal consent.
B. The normal form of pension payment (not including any early retirement
supplements provided by this Plan) for an Employee who does not have a
Surviving Spouse at retirement shall be a monthly income payable for
his life.
C. Within 90 days prior to his retirement date, on a form prescribed by
the Administrator, an Employee may elect one of the following forms of
pension payment (not including any early retirement supplements
provided by this Plan) in lieu of the normal form:
1. Life Annuity -- A monthly income payable for his life.
2. 100% Spouse Survivor Annuity -- A reduced amount payable
monthly for his life with the provision that upon his death
the same amount shall be paid monthly for the life of his
Surviving Spouse.
3. 55% Joint & Survivor Annuity -- A reduced amount payable
monthly for his life with the provision that upon his death an
amount equal to 55% of such reduced amount shall be paid
monthly for the life of his Joint Annuitant.
31
4. 100% Joint & Survivor Annuity -- A reduced amount payable
monthly for his life with the provision that upon his death
the same amount shall be paid monthly for the life of his
Joint Annuitant.
5. Lump Sum -- A lump sum settlement of his frozen benefits
determined under Subsections 10.I and 10.J below. This lump
sum option is not available with respect to Credited Service
or benefits accrued after December 31, 1994, except as
provided in Subsection 10.I below.
D. A 55% spouse survivor annuity or a 55% joint & survivor annuity shall
be the monthly pension determined under either Section 4 or Subsection
5.A, whichever applies, reduced by a percentage that is based on the
relationship of the Employee's age to his Surviving Spouse's age or his
Joint Annuitant's age, whichever is applicable. The age of each shall
be determined as the age at the birthday nearest the date as of which
payments commence. The percentage shall be 7 1/2% if the Employee's age
and his Surviving Spouse's or Joint Annuitant's age are the same. The
percentage shall be decreased by 0.50% for each year up to 15 years by
which the Surviving Spouse's age or the Joint Annuitant's age exceeds
the Employee's age and shall be increased by 0.50% for each year by
which the Surviving Spouse's age or the Joint Annuitant's age is less
than the Employee's age.
E. A 100% spouse survivor annuity or a 100% joint & survivor annuity shall
be the monthly pension determined under either Section 4 or Subsection
5.A, whichever applies, reduced by a percentage that is based on the
relationship of the Employee's age to his Surviving Spouse's age or his
Joint Annuitant's age, whichever is applicable. The age of each shall
be determined as the age at the birthday nearest the date as of which
payments commence. The percentage shall be 13 1/2% if the Employee's
age and his Surviving Spouse's age or Joint Annuitant's age are the
same. The percentage shall be decreased by 0.50% for each year up to 27
years by which the Surviving Spouse's age or the Joint Annuitant's age
exceeds the Employee's age and shall be increased by 0.50% for each
year by which the Surviving Spouse's age or the Joint Annuitant's age
is less than the Employee's age.
F. An Employee who elects a 55% spouse survivor annuity, a 100% spouse
survivor annuity, 55% joint & survivor annuity, or 100% joint &
survivor annuity must furnish proof of the age of his Surviving Spouse
or must designate a Joint Annuitant and furnish proof of the Joint
Annuitant's age, whichever is applicable. Such information must be
fumished to the Administrator at the time the election is made.
G. Subject to Subsection 10.O, if the Employee or the Joint Annuitant or
the Surviving Spouse, whichever is applicable, dies before the
Employee's retirement date after the Employee has elected a 55% or 100%
spouse survivor annuity or a 55% or 100% joint & survivor annuity, the
election is automatically canceled and, if applicable, the pension
shall be paid in the appropriate normal form. If the Employee survives
the Joint Annuitant or his Surviving Spouse, whichever is applicable,
beyond his retirement date, no change shall be made in the Employee's
pension after the death of the Joint Annuitant or the Surviving Spouse,
whichever is applicable, except as provided in Subsection 10.H below.
32
H. If an Employee is receiving a 55% or 100% spouse survivor annuity or a
55% or 100% joint & survivor annuity and his Surviving Spouse or Joint
Annuitant, whichever is applicable, predeceases him within 5 years of
the Employee's retirement date, a portion of the reduction which was
applied to the Employee's monthly pension at retirement because of the
selection of the applicable annuity shall be restored effective the
first of the month following the death of the Surviving Spouse or Joint
Annuitant, whichever is applicable, in accordance with the following:
Year since retirement Portion of
in which Surviving reduction
Spouse or Joint Annuitant died restored
------------------------------ --------
First 100%
Second 80%
Third 60%
Fourth 40%
Fifth 20%
I. If an Employee or Surviving Spouse elects a lump sum in accordance with
Subsection 10.C.5 above, the amount of such lump sum will be the amount
described in Subsection 10.I.1 below, unless Subsection 10.I.2 applies
and is elected.
1. In the case of a normal retirement under Section 4, the lump
sum will be the actuarial equivalent of the Employee's Frozen
Normal Retirement Pension. In the case of an early retirement
under Section 5, the lump sum will be the actuarial equivalent
of his Frozen Early Retirement Pension. In the case of a
terminated Vested Employee under Subsection 6.B, the lump sum
will be the actuarial equivalent of the annuity payable at the
requested commencement date with respect to the Employee's
Frozen Normal Retirement Pension. In the case of a terminated
Vested Employee under Subsection 6.C, the lump sum will be the
actuarial equivalent of the deferred annuity payable at his
Normal Retirement Date with respect to the Vested Employee's
Frozen Normal Retirement Pension. In the case of a Surviving
Spouse under Section 8, the lump sum will be the actuarial
equivalent of the annuity payable with respect to the deceased
Employee's Frozen Normal Retirement, Pension. In the case of a
Surviving Spouse under Subsection 9.D, the lump sum will be
the actuarial equivalent of the annuity payable at the
requested commencement date with respect to the deceased
Employee's Frozen Normal Retirement Pension. In the case of a
Surviving Spouse under Subsection 9.E or 9.F, the lump sum
will be the actuarial equivalent of the deferred annuity
payable at the deceased Employee's Normal Retirement Date with
respect to the deceased Employee's Frozen Normal Retirement
Pension.
2. Where an Employee elects a lump sum in accordance with
Subsections 10.C.5 and 10.I.1 above, he may elect to receive
the remainder of his benefit, if any, in accordance with the
other provisions of this Section 10. The remainder of his
benefit will be the monthly pension payable under the
applicable section of this Plan in excess of the monthly
pension converted to a lump sum. However, if the actuarial
equivalent of such remainder benefit does not exceed $ 10,000,
the Employee may elect to receive his entire accrued benefit,
including benefits
33
with respect to Credited Service after 1994, in a lump sum.
This Subsection 10.I.2 shall also apply to a Surviving Spouse,
except that a remainder benefit paid in the form of an annuity
will be limited to the form of payment described in Section 8
or 9, whichever is applicable.
J. For purposes of Subsection 10.I above and such other provisions of the
Plan that refer to this Subsection 10.J:
For a distribution made on or after the Effective Date, actuarial
equivalent is determined according to this Subsection 10.J based on (i)
the Employee's (or Surviving Spouse's) age, (ii) the prevailing Intemal
Revenue Commissioner's standard table (described in section
807(d)(5)(A) of the Code and without regard to any other subparagraph
of section 807(d)(5) of the Code), used to determine reserves for group
annuity contracts issued on the date equivalency is being determined
and that is prescribed by the Commissioner in guidance published in the
Internal Revenue Bulletin, and (iii) the rate of interest equal to the
annual interest rate on 30-year Treasury securities as specified by the
Commissioner for the second full month preceding the calendar month
during which distribution is being made.
If the benefit payable in a lump sum is not the Employee's (or
Surviving Spouse's) entire vested accrued benefit, then the amount of
the benefit payable in a lump sum shall be calculated by first
determining the lump sum amount based on the entire vested accrued
benefit using the above factors, and then prorating based on the
portion of the annuity payable at the appropriate time as determined in
Subsection 10.I.1 above that is eligible for payment in a lump sum.
For purposes of this Subsection 10.J, a distribution is deemed to be
made on the "annuity starting date" as defined in Internal Revenue Code
section 417(f)(2)(A).
K. A "Distributee" may elect, at the time and in the manner prescribed by
the Administrator, to have any portion of an "Eligible Rollover
Distribution" paid directly to an "Eligible Retirement Plan" specified
by the Distributee in a "Direct Rollover." For purposes of this
section, the following definitions shall have the following meanings:
1. "Distributee" means a person who is entitled to a distribution
under the Plan and who is an Employee, a former Employee, an
Employee's Surviving Spouse, a former Employee's Surviving
Spouse, or an Employee's spouse or former spouse who is the
alternate payee under a qualified domestic relations order, as
defined in section 414(p) of the Internal Revenue Code;
2. "Eligible Rollover Distribution" means any distribution of all
or any portion of the balance to the credit of the
Distributee, except that an Eligible Rollover Distribution
does not include: (i) any distribution that is one of a series
of substantially equal periodic payments (not less frequently
than annually) made for the life (or life expectancy) of the
Distributee or the joint lives (or joint life expectancies) of
the Distributee and the Distributee's designated Beneficiary,
or for a specified period of ten years or more; (ii) any
distribution to the extent such distribution is required under
section 401(a)(9) of the Internal Revenue Code; and (iii) any
portion of any distribution that is not includible in gross
income;
34
3. "Eligible Retirement Plan" means any of the following types of
plans that accept the Distributee's eligible rollover
distribution:
(i) an individual retirement account or individual
retirement annuity described in section 408(a) or
408(b) of the Code, respectively;
(ii) a qualified trust described in section 401(a) of the
Code;
(iii) an annuity contract described in section 403(b) of
the Code; and
(iv) an eligible plan under Section 457(b) of the Code
which is maintained by a state, political subdivision
of a state, or any agency or instrumentality of a
state or political subdivision of a state and which
agrees to separately account for amounts transferred
into such plan from this Plan.
4. "Direct Rollover" means a payment by the Plan to the Eligible
Retirement Plan specified by the Distributee.
L. Except for monthly amounts payable pursuant to Subsections 6.C and 6.D
and Section 9, an overall guarantee of at least 60 times the life
annuity monthly pension amount (without regard to any early retirement
supplements provided by this Plan) shall apply to monthly amounts
payable from the Plan. This guarantee shall not apply to any monthly
supplements which may be payable up to age 62 pursuant to any of the
provisions of the Plan.
1. If the Employee has elected to receive payment in the form of
a life annuity and he dies after payments have begun but
before 60 payments have been made, the balance of such 60
monthly payments shall be payable in a lump sum to the
Beneficiary named by the Employee.
2. If the Employee has elected to receive payment in the form of
a 55% or 100% spouse survivor annuity or a 55% or 100% joint &
survivor annuity and both the Emp!oyee and his Survivor Spouse
or Joint Annuitant, whichever is applicable, die after
payments have begun but before the guaranteed amount of 60
times the life annuity monthly pension amount has been
received, the difference between the guaranteed amount and the
amount received shall be payable in a lump sum to the
Beneficiary of the Employee or his Surviving Spouse or Joint
Annuitant, whoever is the last to die.
The Beneficiary designation under this Subsection 10.L is subject to
the provisions of Subsections 11.4 and 11.6 in the event that no
Beneficiary designation has been made or the designation fails or
lapses.
M. The following special rules shall apply to an Employee or Surviving
Spouse who elects to receive his entire accrued benefit in the form of
a monthly annuity under Subsections 10.C.1 through 10.C.4.
35
1. If such an Employee (i) has Eligibility Service for periods
prior to January 1, 1995 (not including Eligibility Service
for periods prior to January 1, 1995 granted after December
31, 1994); (ii) has Eligibility Service after December 31,
1994; (iii) is eligible for Early Retirement in accordance
with Subsection 2.C; and (iv) elects such an Early Retirement
Pension; then:
(a) such Employee's early retirement monthly amount shall
be calculated using the reduction factors of
Subsections 5.A.1.(a), 5.A.2.(a), and 5.A.2.(b) as
if, solely for purposes of this Subsection 10.M, all
of his Credited Service occurred prior to January 1,
1995, and by determining his benefit under the Flat
Rate method using the formula described in Subsection
4.A.2.(b) rather than Section 19; and
(b) if the Employee has not yet attained age 62, he shall
be entitled to an Early Retirement Supplement
described in and payable in accordance with
Subsection 5.B even though his retirement date is
after December 31,1994.
2. If such Surviving Spouse was married to a deceased Employee
who (i) had Eligibility Service for periods prior to January
1, 1995 (not including Eligibility Service for periods prior
to January 1, 1995 granted after December 31, 1994) and (ii)
had Eligibility Service after December 31, 1994; and if such
Surviving Spouse is eligible for a benefit under Section 8;
then such Surviving Spouse's monthly amount shall be
calculated using the reduction factors of Subsections
8.C.1.(a), 8.C.1.(c), and 8.C.2.(b), whichever applies, as if,
solely for purposes of this Subsection 10.M, all of the
deceased Employee's Credited Service occurred prior to January
1, 1995, and by determining his benefit under the Flat Rate
method using the formula described in Subsection 4.A.2.(b)
rather than Section 19.
N. Notwithstanding any other Plan provisions, an Employee who at the time
of termination or retirement has a pension (including any early
retirement supplements provided by this Plan) with an actuarially
equivalent value, expressed as a lump sum, of less than or equal to
$3,500 or, effective January 1, 2000, $5,000, shall, subject to Section
15, receive his entire benefit in the form of an immediate lump sum
distribution. The amount of such lump sum shall be determined in
accordance with Subsection 10.J above.
O. This Subsection 10.O shall apply only to Employees who attain age 65
prior to January 1, 1995. Notwithstanding Subsections 7.D, 8.A, and
10.G, if such an Employee who continues in the employ of an Employer
beyond his Normal Retirement Date should die prior to retirement but
after having elected a 100% spouse survivor Annuity, a 55% joint &
survivor Annuity, or a 100% joint & survivor Annuity, a monthly amount
shall be payable to his Joint Annuitant or to his Surviving Spouse,
whichever is applicable, calculated in accordance with such election.
Such monthly amount shall be determined as though the Employee had
retired on the first of the month following the month in which his
death occurred with such election in effect, but shall be based on
Credited Service to his date of death. Payments to the Joint Annuitant
or Surviving Spouse shall commence on the first of the second month
following the Employee's date of death, and the first payment will
include a benefit for both such second month
36
and the first month following the month in which the Employee's death
occurred. No benefit shall be paid under this Subsection 10.O unless,
if applicable, the Employee's spouse consents to the designation of a
Joint Annuitant other than the spouse and waives any death benefit
otherwise provided under Sections 8 or 9, pursuant to the consent
provisions of Subsections 10.A and 11.2.
37
SECTION 11 - DESIGNATION OF BENEFICIARY
Beneficiary means the person, persons or entity designated to receive any
benefits under the Plan in the event of the death of an Employee, a Pensioner, a
Surviving Spouse, or a Joint Annuitant, whichever is applicable.
1. Each Employee or Pensioner shall file with the Administrator a written
designation of Beneficiary. Subject to obtaining spousal consent when
required, a Beneficiary designation may be changed by the Employee or
Pensioner at any time upon written notice to the Administrator.
2. The Beneficiary of a married Employee or Pensioner must be the
Employee's or Pensioner's spouse unless the spouse has given written
consent to the designation of some other person, persons or entity as
Beneficiary. Such consent must be witnessed by a notary public.
Notwithstanding the foregoing, if an Employee or Pensioner establishes
to the satisfaction of the Administrator that a written consent cannot
be obtained because the spouse cannot be located, or because of such
other circumstances as may be permitted by law, spousal consent shall
not be required.
3. An unmarried Employee or Pensioner may designate any person, persons or
entity as Beneficiary without restriction. However, an unmarried
Employee or Pensioner who later marries must at that time obtain
spousal consent (as described in Subsection 11.2) in order for the
Employee's or Pensioner's existing Beneficiary designation to remain
valid. If a divorced Employee or Pensioner later remarries, the
Employee or Pensioner must obtain the consent of the Employee's or
Pensioner's new spouse to the Beneficiary designation, even if the
Employee or Pensioner obtained the consent of the Employee's or
Pensioner's former spouse to the Beneficiary designation.
4. Notwithstanding the fact that an Employee or Pensioner has obtained
spousal consent to the designation of some other person, persons or
entity as a Beneficiary, if the validly designated Beneficiary is not
living at the time of such Employee's or Pensioner's death, the
Surviving Spouse shall become the Beneficiary. If there is no Surviving
Spouse, payment shall be made to the legal representative of the
Employee or Pensioner.
5. No Beneficiary shall, prior to the death of the Employee or Pensioner,
acquire any interest in the Plan or in the assets of the Trust.
6. A Surviving Spouse or a Joint Annuitant who is entitled to receive a
benefit under the Plan as a result of the death of the Employee or
Pensioner, shall designate a Beneficiary to receive any amounts which
might become payable upon the death of such Surviving Spouse or Joint
Annuitant. Absent such a designation, any amounts payable shall be paid
to the legal representative of the Surviving Spouse or Joint Annuitant,
whichever is applicable.
7. A valid Beneficiary designation under the Predecessor Plan of a WGSC
Transferee (as defined in the Introduction to the Plan) who was
eligible to participate in the Predecessor Plan prior to such
individual's transfer to an Employer shall remain in effect under this
Plan until changed by the WGSC Transferee.
38
SECTION 12 - ADMINISTRATION
A. Company.
The Company is the "plan sponsor" of the Plan, as described by section
3(16)(B) of ERISA, and is the "named fiduciary" of the Plan, within the
meaning of section 402(a)(2) of ERISA. The Company has all
responsibilities not otherwise delegated to the Administrative
Committee, the Investment Committee, the Trustee, the Administrator, or
the Investment Managers, including:
1. making contributions to the Plan;
2. amending the Plan by written resolution of the Board as
provided in Section 18; and
3. appointing and dismissing, by written action of the Chief
Executive Officer of the Company or the Board, members of the
Administrative Committee and the Investment Committee.
B. Administrative Committee.
The Company, as the "named fiduciary" of the Plan within the meaning of
section 402(a)(2) of ERISA, may appoint an Administrative Committee
with respect to Plan administrative matters. Subject to the terms of
the Plan, the Trust Agreement and applicable resolutions of the Board,
the Administrative Committee, when duly constituted, shall have full
and absolute discretion and authority to control and manage the
operation and administration of the Plan, and to interpret and apply
the terms of the Plan and the Trust Agreement. This full and absolute
discretion and authority includes, but is not limited to, the power to:
1. interpret, construe, and apply the provisions of the Plan and
Trust Agreement, and any construction adopted by the
Administrative Committee in good faith shall be final and
binding;
2. adopt Plan amendments that (a) are required by ERISA or other
applicable law or regulation governing qualification of
employee benefit plans, or are necessary for Plan
administration, and which do not materially increase costs to
the Plan or the Company or materially change participants'
benefits under the Plan, (b) implement special rules in
Section 14 for acquisitions, sales, and other dispositions,
(c) revise the list of Employers in Appendix D, or (d) clarify
ambiguous or unclear Plan provisions; provided that such
amendments will be made in writing and will be made according
to procedures established by the Administrative Committee, and
3. review appeals from the denial of benefits.
The Administrative Committee may employ, appoint, and dismiss advisors
as the Administrative Committee deems necessary to carry out the
provisions of the Plan and
39
the Trust Agreement, including attorneys, accountants, actuaries,
clerks, or other agents, and may delegate any of their authority and
duties to such persons.
C. Investment Committee.
The Company, as the "named fiduciary" of the Plan within the meaning of
section 402(a)(2) of ERISA, may, in its discretion, appoint the
Investment Committee with respect to Plan investments. Subject to the
terms of the Plan, the Trust Agreement and applicable resolutions of
the Board, the Investment Committee, when duly constituted, shall have
full and absolute discretion and authority to:
1. establish the Plan's investment policy;
2. appoint and dismiss Investment Managers (as described by
section 3(38) of ERISA) and the Trustee;
3. provide guidelines and directions to, and monitor the
performance of, Investment Managers and the Trustee;
4. establish the Plan's funding and actuarial policies and
practices; and
5. manage the funding, cost, and financial aspects of the Plan.
The Investment Committee may employ, appoint, and dismiss advisors as
the Investment Committee deems necessary to carry out the provisions of
the Plan and the Trust Agreement, including attorneys, accountants,
actuaries, clerks, or other agents, and may delegate any of their
authority and duties to such persons.
D. Administrator.
The Administrator is responsible for, and has authority to:
1. adopt rules and procedures as necessary or appropriate for
Plan administration and the processing of claims for benefits;
2. make all initial determinations regarding claims or benefits,
including authority to interpret and apply any applicable Plan
provisions to the facts involved in each benefits claim, and
provide notice described in Subsection 12.J to any claimant
whose claim is denied;
3. subject to guidelines provided by the Administrative
Committee, direct the Trustee regarding: (a) payment of
benefits to participants. and (b) payment of the reasonable
and necessary expenses of the Plan from Plan assets;
4. obtain fidelity bonds and fiduciary insurance coverage, in
accordance with applicable provisions of ERISA; and
5. comply with and monitor the Plan's continued compliance with
all governmental laws and regulations relating to
recordkeeping and reporting of participants'
40
benefits, other notifications to participants, registration
with the Internal Revenue Service, and reports to the
Department of Labor.
E. Trustee.
The Trustee has exclusive responsibility for control and management of
Plan assets, in accordance with the Trust Ageement. The Trustee is
responsible for, and has authority to:
1. invest, marage, and control Plan assets, subject to the
direction of the Investment Committee and Investment
Manager(s) appointed by the Investment Committee, or of the
Company;
2. maintain records and accounts of all contributions, receipts,
investments, distributions, expenses, disbursements, and all
other transactions; and
3. prepare records, reports, statements, tax returns, and forms
required to be furnished to participants or filed with the
Secretary of Labor or Treasury, as required by the Trust
Agreement, or the directions of the Administrative Committee
or Administrator.
F. Investment Managers.
Investment Managers manage and invest Plan assets subject to the Plan,
the Trust Agreement, and guidelines and directions provided by the
Investment Committee or the Company.
G. Allocation of Fiduciary Authority.
The Company, other Employers, the Administrative Committee, the
Investment Committee, the Administrator, the Trustee, and the
Investment Manager(s) (collectively, the "Plan Fiduciaries") each have
individual responsibility for the prudent execution of their
responsibilities assigned under this Plan, and are not liable for acts
or failures by another Fiduciary, unless the Plan provides for shared
fiduciary responsibility. Plan Fiduciaries are obligated to discharge
their duties with respect to the Plan solely and exclusively in the
interest of Plan participants and their beneficiaries, and 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.
Whenever the Plan or Trust Agreement requires one Fiduciary to provide
information or direct the activities of another Fiduciary, the two may
not be deemed to have shared Fiduciary responsibility. Instead, the
Fiduciary giving directions or providing information is solely
responsible for prudently directing or informing the other, and the
Fiduciary receiving the direction or information is entitled to rely on
that direction or information as proper under the Plan, the Trust
Agreement, and applicable law.
Any individual may serve in more than one capacity. For example, the
same individual may serve on the Administrative Committee and on the
Investment Committee, and as an agent of the Company or as the
Administrator. However, no Plan Fiduciary who is
41
employed by an Employer or an entity in the Controlled Group of an
Employer may be compensated for services to the Plan from Plan assets.
H. Indemnification of Fiduciaries.
1. To the extent permitted by applicable law, the Board, the
Administrative Committee, the Investment Committee, the
Administrator, and any employee, officer, or director of the
Employer or an Affiliated Entity to whom duties and
responsibilities have been allocated or delegated under this
Plan and Trust ("Covered Persons") shall be indemnified and
saved harmless by the Plan and Trust from and against any and
all claims of liability arising in connection with the
exercise of the Covered Person's duties and responsibilities
with respect to the P'ian and Trust by reason of any act or
omission, including all expenses reasonably incurred in the
defense of such act or omission, unless:
(a) it will be established by final judgment of a court
of competent jurisdiction that such act or omission,
including all expenses reasonably incurred in the
defense of such act or omission, involved a violation
of the duties imposed by Part 4 of Subtitle B of
Title I of ERISA on the part of such Covered Person,
or
(b) in the event of settlement or other disposition of
such claim involving the Plan and Trust, it is
determined by written opinion of independent counsel
that such act or omission involved a violation of the
duties imposed by Part 4 of Subtitle B of Title I of
ERISA on the part of such Covered Person.
2. To the extent permitted by applicable law, the Trust will pay
expenses (including reasonable attorneys' fees and
disbursements), judgments, fines, and amounts paid in
settlement incurred by the Covered Person in connection with
any of the proceedings described above, provided that
(a) the Covered Person will repay such advanced expenses
to the Trust, plus reasonable interest, if it is
established by a final judgment of a court of
competent jurisdiction, or by written opinion of
independent counsel under the circumstances described
above, that the Covered Person violated duties under
Part 4 of Subtitle B of Title I of ERISA, and
(b) the Covered Person will make appropriate arrangements
for repayment of advanced expenses.
Notwithstanding the foregoing, no such advanced expenses will
be made in connection with any claim against a Covered Person
that is made by the Plan, provided that upon final disposition
of such claim, the expenses (including reasonable attorneys'
fees and disbursements), judgments, fines, and amounts paid in
settlement incurred by the Covered Person will be reimbursed
by the Plan to the extent provided above.
I. Claims for Benefits.
42
Each person (including any Employee, former Employee, Joint Annuitant,
Surviving Spouse, or other Plan Beneficiary) must file a claim with the
Administrator for any benefit to which that person believes he is
entitled under this Plan, in accordance with procedures established by
the Administrator.
Generally, the Administrator is required to decide each claim within 90
days of the date on which the claim is filed. If special circumstances
require a longer period for adjudication, the Administrator must notify
the claimant in writing of the reasons for an extension of time, and
the date by which the Administrator will decide the claim, before the
90 day period expires. Extensions beyond 90 days after the expiration
of the initial 90-day period are not permitted. If the Administrator
does not notify the claimant of its decision to grant or deny a claim
within the time specified by this section, the claim will be deemed to
have been denied and the appeal procedure described in Subsection K
below will become available to the claimant.
J. Notice of Denial of Claim for Benefits.
If the Administrator denies a claim for benefits under the Plan, the
claimant will receive a written notice that explains:
1. the specific reason for the denial, including specific
reference to pertinent Plan provisions on which the denial is
based;
2. any additional information or material necessary to perfect a
claim, with an explanation of why such material is necessary,
if any information would be helpful or appropriate to further
consideration of the claim; and
3. the steps to be taken if the claimant wishes to appeal,
including the time available for appeal.
K. Appeal of Denied Claims for Benefits.
Claimants must submit a written request appealing the denial of a claim
within 60 days after receipt of notice described by Subsection 12.J.
Claimants may review all pertinent documents, and submit issues and
comments in writing. The Administrative Committee (or its delegate)
will provide a full and fair review of all appeals from denial of a
claim for benefits, and their decision will be final and binding.
The decision of the Administrative Committee (or its delegate)
ordinarily will be given within 60 days after receipt of a written
request for appeal, unless special circumstances require an extension
(such as for a hearing). If an extension of time for appeal is
necessary, the claimant will receive written notice of the extension
before the 60-day period expires. The decision may not be delayed
beyond 120 days after receipt of the written request for appeal. Notice
of the decision on appeal will be provided in writing, and will explain
the basis for the decision, including reference to applicable
provisions of the Plan, in a manner calculated to be understood by the
person who appealed the denial of a claim.
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L. Exhaustion of Remedies,
No legal action for benefits under the Plan may be brought unless and
until the following steps have occurred:
1. the claimant has submitted a written application for benefits
in accordance with Subsection 12.I;
2. the claimant has been notified that the claim has been denied,
as provided by Subsection 12.J;
3. the claimant has filed a written request appealing the denial
in accordance with Subsection 12.K; and
4. the claimant has been notified in writing that the
Administrative Committee (or its delegate) has denied the
claimant's appeal, or the Administrative Committee has failed
to act on the appeal within the time prescribed by Subsection
12.K.
44
SECTION 13 - FUNDING
A. The Company and any other Employers intend to fund this Plan by making
such contributions to the Trustee or Trustees or by paying such
premiums under any insured contract or contracts which, in addition to
contributions made by Employees, wiII be sufficient to fund the
benefits provided under this Plan, in accordance with accepted
actuarial principles and the minimum funding standards of section 412
of the Internal Revenue Code.
B. If all or part of the Employers' contributions to the Plan are
disallowed by the Internal Revenue Service under Section 404 of the
Internal Revenue Code, the portion of the contributions to which that
disallowance applies shall be returned to the Employers without
interest, but reduced by any investment loss attributable to those
contributions. The return shall be made within one year after the date
of the disallowance of deduction. The Employers may also recover
without interest the amount of contributions to the Plan made on
account of a mistake of fact, reduced by any investment loss
attributable to those contributions, if recovery is made within one
year after the date of those contributions. Contributions under the
Plan are conditioned upon the initial qualification of the Plan under
section 401(a) of the Internal Revenue Code by the Internal Revenue
Service, and the Employers may recover contributions made to the Plan,
reduced by any investment loss attributable to those contributions,
within one year after an adverse determination by the Internal Revenue
Service, recover contributions made to the Plan, reduced by any
investment loss attributable to those contributions, as described in
section 403(c)(2)(B) of ERISA.
C. In determining whether or not the requirements of this Section 13 have
been met, the assets of any trust fund established under this Plan
shall be valued on a basis that takes into account fair market value as
permitted by applicable regulations.
D. The Company and any other Employers, by payment of contributions to the
Trustee or Trustees and/or insurance company or companies, shall be
relieved of any further liability, and benefits shall be payable only
from the trust fund or under the insured contract or both, provided,
however, that any Trust Agreement and/or insurance contract under which
such payments are made shall not be inconsistent with any provisions of
this Plan.
E. The Company shall have the right to provide in any Trust Agreement that
the funds of any trust may be invested in securities or other
investments including, but not limited to common stock of any
corporation, the common stock or any other securities or obligations of
the Employer, and group or common trust funds, to the extent such
investments are not inconsistent with the requirements of ERISA.
45
SECTION 14 - ACQUISITIONS, SALES, AND OTHER DISPOSITIONS
A. In the event an Employer should acquire shares of stock or other assets
and properties of any other company which has a pension plan, qualified
under section 401(a) of the, Internal Revenue Code, in effect at the
time of such acquisition, the Administrative Committee may in such
manner and to such extent as it deems advisable grant benefits under
this Plan, for service with such other company prior to the date of
acquisition, based on the benefit formula of such company's pension
plan.
B. In the event an Employer should acquire shares of stock or assets and
properties of any other company which does not have a pension plan,
qualified under section 401(a) of the Internal Revenue Code, in effect
at the time of such acquisition, the Administrative Committee may in
such manner, to such extent and for such purposes under this Plan as it
deems advisable treat employment with such other company, either prior
to acquisition by an Employer or thereafter, as Credited Service or
Eligibility Service under this Plan.
C. In the event of the sale or other disposition of any subsidiary,
division, department, or other identifiable group or unit of an
Employer to an organization that has established a pension plan
qualified under section 401(a) of the Internal Revenue Code, which plan
provides for the extension of benefits to each Employee affected by
such sale or other disposition based upon Credited Service under this
Plan, the Administrative Committee may, for the purpose of funding such
qualified pension plan, direct the segregation and transfer to the
trust created by the acquiring organization an appropriate portion of
the funds accumulated under this Plan, determined by the Administrative
Committee in accordance with accepted actuarial principles and the
requirements of section 414(l) of the Code.
D. In the event of the sale or other disposition of any subsidiary,
division, department, or other identifiable group or unit of an
Employer to an organization which agrees to adopt and continue this
Plan with respect to Employees whose employment continues with the
acquiring organization, the Administrative Committee may, for the
purpose of funding this Plan as so adopted and continued, direct the
segregation of an appropriate portion of the assets held in trust under
this Plan, determined by the Administrative Committee in accordance
with accepted actuarial principles and the requirements of section
414(l) of the Code, and the acquiring organization may be substituted
as settler of the trust or trusts in which such portion of the assets
is held.
E. In the event an Employee who becomes a participant in a pension plan of
an acquiring organization pursuant to Subsection 14.C or 14.D should
subsequently again become an Employee of an Employer after having
become entitled to a vested pension under the pension plan of the
acquiring organization, benefits payable under this Plan based on
Credited Service prior to his reemployment shall be reduced by the
vested pension payable from the pension plan of the acquiring
organization attributable to the same period of Credited Service. All
Credited Service accumulated under this Plan prior to his reemployment
shall, however, be considered as Eligibility Service in determining
eligibility for benefits under this Plan.
F. Any provisions in this Plan to the contrary notwithstanding,
46
1. In the event an Employee transfers directly to any other
corporation or affiliate thereof in connection with the
transfer to such other corporation of Company assets or of
govemment-owned facilities maintained or operated under
contract by an Employer, or who may be transferred by any such
other corporation or affiliate thereof to another affiliate
thereof subsequent to his transfer from an Employer, the
Administrative Committee may, by regulations or otherwise and
to the extent that it considers advisable, treat service with
any such other corporations as service with an Employer for
purposes of vesting and for determining eligibility for any
pensions accrued to the date of such transfer or any other
benefits under this Plan which are dependent on a
service-eligibility requirement.
2. In the case of an Employee who at any time shall be
transferred directly to any other corporation but whose
service with such corporation or affiliate thereof is
considered by the Administrative Committee as service with an
Employer for any purpose under this Plan, the commencement of
pension or other payments under this Plan'to or on behalf of
such an Employee shall not be made while the Employee is in
the service of such corporations except as the Administrative
Committee may provide otherwise and elections of options under
this Plan by such an Employee and the time of commencement and
manner of payment of pension and other payments under this
Plan to or on behalf of such an Employee shall be as
determined by the Administrative Committee.
47
SECTION 15 - TRANSFERRED EMPLOYEES
A. An Employee who transfers to an Employer from an Affiliated Entity or
an Excluded Unit shall have Eligibility Service based on periods of
employment with the Affiliated Entity or Excluded Unit from which he
transferred included under this Plan taken into account in determining
whether he has satisfied the eligibility requirements for any benefit
under this Plan. Such Eligibility Service shall not be used in
determining the amount of any benefit under this Plan.
B. An Employee who transfers from an Employer to an Affiliated Entity, an
Excluded Unit, shall be eligible for benefits under this Plan as
follows:
1. Subject to Subsection 4.D and section 401(a)(14) of the
Internal Revenue Code, the Employee shall not be eligible to
receive any benefits under the Plan while employed by an
Affiliated Entity, an Excluded Unit.
2. As set forth in Subsection 1.12, Eligibility Service based on
periods of employment with the Affiliated Entity, Excluded
Unit to which he transferred shall be included under this Plan
in determining whether such a transferred Employee has
satisfied the eligibility requirements for a pension under the
Plan. Such Eligibility Service shall not be used in
determining the amount of any benefit under this Plan.
3. Normal, Early, or Special Retirement Pensions shall be payable
under this Plan if, at the time his employment with the
Affiliated Entity, Excluded Unit ceases, he has satisfied the
age, service and any other requirements of this Plan for such
benefits. The amount of such Normal, Early, or Special
Retirement Pension shall be determined as if such transferred
Employee was at such time retiring under this Plan, receiving
full credit under this Plan for (a) Credited Service
accumulated to date of transfer, (b) any Employee
contributions made under the Plan which have not been
refunded, and (c) such earnings, wages or base salary in
effect at the time the Employee terminates employment with the
Affiliated Entity, Excluded Unit as are applicable under the
terms of this Plan at the time of such determination of
benefits.
4. A transferred Employee who subsequently terminates his
employment with the Affiliated Entity, Excluded Unit prior to
satisfying the requirements for retirement but who is eligible
for a Vested Pension under this Plan at the time of such
termination shall have the amount of such Vested Pension based
on the terms of this Plan in effect at the time of such
separation, receiving full credit under this Plan for (a)
Credited Service accumulated to date of transfer, (b) any
Employee contributions made under the Plan which have not been
refunded, and (c) such earnings, wages or base salary in
effect at the time the Employee terminates employment with the
Affiliated Entity, Excluded Unit as are applicable under the
terms of this Plan at the time of such separation.
C. For the purposes of this Section 15, an Employee shall be deemed to be
transferred if he:
48
1. transfers directly from an Employer to an Affiliated Entity,
Excluded Unit, or transfers directly from an Affiliated
Entity, Excluded Unit to an Employer, or
2. is employed at an Affiliated Entity, Excluded Unit after
having terminated employment with an Employer or is employed
by an Employer after having terminated employment with an
Affiliated Entity, Excluded Unit.
49
SECTION 16 - SUSPENSION OF BENEFITS AND REEMPLOYMENT
A. In the event a Pensioner is reemployed by an Employer or an entity in
the Controlled Group of an Employer, his pension payments shall be
suspended. In the event the benefits of a Pensioner should have been
suspended but were not, the Plan shall offset future benefits to recoup
the benefits that should have been suspended to the extent permitted
under regulations issued by the Department of Labor.
Notwithstanding the foregoing, there shall be no suspension of pension
payments for a Pensioner who is reemployed if such suspension would be
in violation of applicable Labor Regulations.
B. In those cases where a reemployed Pensioner continues to receive a
pension after his Normal Retirement Date, not taking into account
amounts that are paid to satisfy the requirements of section 401(a)(9)
of the Internal Revenue Code and the Treasury regulations thereunder,
further accruals of pension amounts for a Plan Year will be reduced
(but not below zero) by the actuarial equivalent of the total Plan
benefit distributions made to the Pensioner by the close of the Plan
Year.
C. In those cases where the pension is suspended due to the reemployment
of a Pensioner, the following shall apply:
1. Credited Service and Eligibility Service shall include the
respective periods of Credited Service and Eligibility Service
accrued both prior to his earlier retirement and subsequent to
his re-employment.
2. If the Employee is reemployed for a period of at least six (6)
consecutive months, his pension upon his subsequent retirement
shall be based on the provisions of the Plan in effect at that
time.
3. If the Employee is reemployed for a period of less than six
(6) consecutive months, his pension for the period prior to
reemployment shall be based on the benefit formulas of the
Plan which were in effect at his original retirement date,
except as provided in Subsection 1.10.D.
4. Upon his subsequent retirement, an Employee may elect a
different form of payment, pursuant to Section 10, than he
elected at his original retirement date.
5. Should an Employee die while reemployed, his Surviving Spouse
shall be eligible for the Surviving Spouse Benefits set forth
in either Section 8 or Section 9, whichever is applicable,
unless Subsection 10.O applies and has been elected.
6. In determining any remaining payments due the Beneficiary of a
Pensioner based on the 60 month guarantee described in
Subsection 10.L of the Plan, all payments made on behalf of
the Pensioner, both before and after his reemployment shall be
considered.
50
D. In the event a former Employee is re-employed by an Employer after
having retired and having received a lump sum pursuant to Subsection
10.C.5 that consists of the actuarial equivalent determined under
Subsection 10.J of his entire accrued benefit, such former Employee
shall be considered a new hire with respect to future pension accruals.
For the purpose of determining such Employee's eligibility for
benefits, however, his previous Eligibility Service shall be restored.
E. Subject to Subsection 4.D, in the event an Employee continues working
past his Normal Retirement Date, the payment of his benefits shall be
suspended and he shall be notified of such suspension in accordance
with applicable Labor Regulations.
F. If an Employee or former Employee receives after December 31, 1994 a
lump sum distribution that is less than the actuarial equivalent of his
entire vested accrued benefit as of the date of such distribution, he
may restore such distributed benefit upon reemployment by an Employer
as provided below by repaying to the Plan the full amount of such
distribution plus interest, compounded annually from the date of
distribution to the date of repayment at the rate determined for
purposes of section 411(c)(2)(C) of the Code. Such repayment must be
made within five years from the date of reemployment. If repayment is
available and made under this Subsection 16.F, then the Employee's or
former Employee's accrued benefit with respect to the amount
distributed will be restored, including all optional forms of benefits
and subsidies with respect to the amount distributed that were
available at the time of the distribution.
51
SECTION 17 - MISCELLANEOUS
A. Nonalienation.
No Plan benefit will be subject in any manner to anticipation, pledge,
encumbrance, alienation, levy, or assignment, nor to seizure,
attachment, or other legal process for the debts of any Employee,
former Employee, or other Plan Beneficiary, except as otherwise
provided in section 401(a)(13) of the Internal Revenue Code or pursuant
to a qualified domestic relations order under section 414(p) of the
Internal Revenue Code or a domestic relations order entered before
January 1, 1985 that the Administrator treats as a qualified domestic
relations order. For the purposes of computing benefits payable to an
alternate payee under a qualified domestic relations order, the
equivalent actuarial value of such benefits shall be computed as of the
date on which benefits are first payable and shall be based on the
mortality table and interest rate assumptions provided under Subsection
10.J.
B Facility of Payment.
If, in the opinion of the Administrative Committee, a person to whom a
benefit is payable is unable to care for his affairs because of
illness, accident, or any other reason, any payment due the person,
unless prior claim therefor shall have been made by a duly qualified
guardian or other duly appointed and qualified representative of such
person, may be paid to some member of the person's family, or to some
other party who, in the opinion of the Administrative Committee, has
incurred expense for such person. Any such payment shall be a payment
for the account of such person and shall be a complete discharge of
liability under this Plan.
C. Conditions of Employment not affected by Plan.
Each Employer in adopting this Plan shall not be held to create or vest
in any Employee or any other person any interest, pension or benefits
other than the benefits specifically provided herein, or to confer upon
any Employee the right to remain in the service of his Employer.
D. Statements of Employee Contributions.
Each Employee who has made contributions under the Plan and who has not
had such contributions refunded to him shall upon written request be
furnished a statement each year indicating his contributions for the
preceding year, the aggregate of his contributions in this Plan at the
end of the preceding year, and the aggregate of his contributions, With
Interest, to the end of the preceding year. Each Employee who is or
could become eligible for a pension under this Plan shall upon written
request be furnished a statement each year unless the amount of pension
he earned during such year is not determinable, indicating the amount
of pension, if any, that he earned during the preceding year under
Section 4 of this Plan, as well as the amount of accumulated monthly
pension, if any, that he earned under Section 4 of this Plan to the end
of the preceding year. The information described in this Subsection
17.D may be provided in a combined statement.
52
E. Statements of Vested Benefits.
Each Employee who is separated from employment and who, according to
the Administrator's records, is a Vested Employee, shall be fumished a
statement within the time limits required by law setting forth his
pension benefits under Section 6 of this Plan.
F. Payment of Expenses.
Reasonable expenses of the Plan, including indemnification under
Subsection 12.H, may be paid from Plan assets, unless paid by an
Employer. Each Employer is entitled to reimbursement of direct expenses
properly and actually incurred in providing services to the Plan, in
accordance with applicable provisions of ERISA.
G. Merger, Consolidation, or Spinoff.
In the case of any merger or consolidation of this Plan with, or the
transfer of assets or liabilities to, any other plan, the terms of the
merger, transfer, or consolidation shall be such that each participant
would (if this Plan then terminated) receive a benefit immediately
after the merger, consolidation, or transfer which is equal to or
greater than the benefit he would have been entitled to receive
immediately before the merger, transfer, or consolidation (if this Plan
had then terminated).
H. Applicable Law.
The Plan will be construed, interpreted, and enforced according to the
laws of Pennsylvania, to the extent such laws are not inconsistent with
and preempted by ERISA.
I. Treatment of Military Service.
Notwithstanding any provision of this Plan to the contrary,
contributions, benefits and service credit with respect to qualified
military service will be provided in accordance with section 414(u) of
the Code.
J. Actuarial Equivalence.
If the meaning of "actuarial equivalent" is not otherwise specified
with respect to any provision of this Plan, it shall mean an amount
determined by applying a seven percent interest rate and the GAM 1983
mortality table.
53
SECTION 18 - AMENDMENT AND TERMINATION
A. While the Company expects and intends to continue the Plan
indefinitely, it reserves the right, acting by written resolution of
the Board (or its duly authorized delegates), at any time and from time
to time, to amend, in whole or in part, any or all of the provisions of
the Plan, to discontinue contributions to the Plan, or to terminate the
Plan. The Administrative Committee (or its duly authorized delegate)
may also adopt certain Plan amendments in accordance with Subsection
12.B.2. Notwithstanding the above, no part of the assets of the Plan
shall, by reason of any amendment, discontinuance, or termination, be
used for or diverted to purposes other than for the exclusive benefit
of the participants and their beneficiaries under the Plan, unless and
until all liabilities of the Plan have been satisfied, in which case
any remaining assets may revert to the Company. In addition, (i) no
amendment, discontinuance, or termination shall eliminate or reduce
benefits that have already accrued that are protected under section
411(d)(6) of the Code, and (ii) if the vesting schedule of the Plan is
amended, in the case of an Employee who is a participant as of the
later of the date such amendment is adopted or the date it becomes
effective, the nonforfeitable percentage (determined as of such date)
of such Employee's benefit will not be less than the percentage
computed under the Plan without regard to such amendment.
B. If the Plan is terminated, or partially terminated, the rights of
affected participants to benefits accrued under the Plan shall be
nonforfeitable to the extent funded. The funds held by the Trustee or
Trustees and/or insurance company or companies shall be applied to
provide pensions for participants and beneficiaries, in the following
order of priority:
1. First, to that portion of each individual's accrued benefit
which is derived from the participant's contributions.
2. Second, in the case of benefits payable under this Plan as an
annuity --
(a) in the case of the benefit of a participant or
Beneficiary who was receiving a benefit as of the
beginning of the 3 year period ending on the
termination date of this Plan, to each such benefit,
based on the provisions of this Plan (as in effect
during the 5 year period ending on such date) under
which such benefit would be the least,
(b) in the case of the benefit of a participant or
Beneficiary (other than a benefit described in
Subsection 18.B.2(a) above) which would have at any
time, been paid as of the beginning of such 3 year
period if the participant had retired prior to the
beginning of such 3 year period and if his benefits
had commenced (in the normal form of distribution) as
of the beginning of such period, to each such benefit
based on the provisions of this Plan (as in effect
during the 5 year period ending on such date) under
which such benefit would be the least.
3. Third, to all other benefits under this Plan guaranteed
under Title IV of ERISA, as provided in section 4044(a)(4)
thereof
54
4. Fourth, to all other non-for-feltable benefits under this Plan.
5. Fifth, to all other benefits under this Plan.
The amounts allocated with respect to any benefit under any paragraph
above shall be properly adjusted for any allocation of assets with
respect to that benefit under a prior paragraph.
If the assets available for allocation under any paragraph of this
Subsection 18.B are insufficient to satisfy in full the benefits of all
individuals entitled thereto, the assets shall be allocated as provided
in section 4044 of ERISA and any regulations issued thereunder.
C. In the event the Plan terminates, the benefit of any Highly Compensated
Employee is limited to a benefit that is nondiscriminatory under
Internal Revenue Code section 401(a)(4). For Plan Years beginning after
December 3l,1993, benefits distributed to any of the 25 most Highly
Compensated Employees are restricted such that the annual pension
payments are no greater than an amount equal to the payment that would
be made on behalf of the Pensioner under a single life annuity that is
the actuanal equivalent of the sum of the Pensioner's accnied benefit
and the Pensioner's other benefits under the Plan. The preceding
sentence shall not apply if: (1) after payment of the benefit to a
Pensioner described in the preceding sentence, the value of Plan assets
equals or exceeds 110% of the value of current Plan liabilities, as
defined in Internal Revenue Code section 412(l)(7); or (2) the value of
the benefits for a Pensioner so described is less than 1% of the value
of current Plan liabilities.
D. If the Plan's vesting schedule is amended, or the Plan is amended in
any way that directly or indirectly affects the computation of the
nonforfeltable percentage of a participant's benefits, or if the Plan
is deemed amended by an automatic change to or from a top-heavy vesting
schedule, each participant with at least three years of Eligibility
Service may elect, within a reasonable period after the adoption of the
amendment or change, to have the non-for-feltable percentage computed
without regard to such amendment or chance.
55
SECTION 19 - FLAT RATE METHOD FOR 1994
A. The accumulated pension under the Flat Rate method for Employees who
retire during the calendar year 1994 shall be the sum of 1. and 2.
below.
1. If the Employee elected to make contributions when he was
first eligible to do so, his Flat Rate method monthly pension
amount for all Credited Service accumulated prior to the first
date such an election could have been effective, and his Flat
Rate method monthly pension amount for any period of Credited
Service during which he elected to contribute, shall be based
on the Final Average Compensation Schedule in Subsection B
below.
2. If the Employee elected not to make contributions when he was
first eligible to do so, his Flat Rate method monthly pension
amount for all Credited Service accumulated prior to the first
date such an election could have been effective, and his Flat
Rate method monthly pension amount for any period of Credited
Service during which he elected not to contribute, shall be
equal to the product of $13.00 times the applicable years of
Credited Service.
B. Final Average Compensation Schedule
Final Average Monthly Pension for Each
Compensation Year of Credited Service
------------ ------------------------
Over Up to
---- -----
$27,750 $23.50
$27,750 28,050 23.75
28,050 28,350 24.00
28,350 28,650 24.25
28,650 28,950 24.50
28,950 29,250 24.75
29,250 29,550 25.00
29,550 29,850 25.25
29,850 30,150 25.50
30,150 30,450 25.75
30,450 30,750 26.00
30,750 31,050 26.25
31,050 31,350 26.50
31,350 31,650 26.75
31,650 31,950 27.00
31,950 32,250 27.25
32,250 32,550 27.50
32,550 32,850 27.75
32,850 33,150 28.00
33,150 33,450 28.25
33,450 33,750 28.50
33,750 34,050 28.75
34,050 29.00
56
For the purposes of the above schedule, an Employee's Final Average
Compensation shall be the average of his Compensation for the three (3)
calendar years in which such Compensation was highest during the last
ten (10) calendar years immediately preceding the last year in which he
accrued Eligibility Service.
C. For purposes of this Section 19, "Compensation" means Compensation as
defined in Section 1.8 except that in no event shall the Compensation
used for determining Final Average Compensation for any calendar year
be less than the following:
1. For a Salaried Employee, the base salary rate on December 1 of
the preceding year plus any cost-of-living adjustments made in
the Employee's base salary rate up through the January next
following such December 1, multiplied by 52, if the Employee
is paid weekly, or multiplied by 12, if the Employee is paid
monthly; or
2. For an Hourly-Paid Employee, the average earned rate for the
calendar quarter ending September 30 of the preceding year
plus any cost-of-living adjustments made in the Employee's pay
rate up through the January next following such September 30,
multiplied by 2080.
For any calendar year in which a Salaried Employee did not have a base
salary rate on December 1, the last base salary rate in effect prior to
such December 1 shall be used for that year provided, however, that if
the Employee accrued Eligibility Service in such year, the base salary
rate so used shall be increased to include any general or
cost-of-living increases granted up to the earlier of the end of the
January next following such December 1 or the date on which the
Employee ceased to accrue Eligibility Service.
For any calendar year in which an Hourly-Paid Employee did not have an
average earned rate for the calendar quarter ending September 30, the
last calendar quarter preceding such quarter for which an average
earned rate was determined shall be used for that year provided,
however, that if the Employee accrued Eligibility Service in such year,
such average earned rate so used shall be increased to include any
general or cost-of-living increases granted up to the earlier of the
end of the January next following such third calendar quarter or the
date on which the Employee ceased to accrue Eligibility Service.
57
IN WITNESS WHEREOF, the Company has caused this instrument to be executed by its
authorized officer to be effective as of the 29th day of October, 2002.
CURTISS-WRIGHT CORPORATION
By:__________________________________
58
APPENDIX A - TOP HEAVY PROVISIONS
The following special provisions shall apply to determine if the Plan is a Top
Heavy Plan as to any Employer that has adopted this Plan, in accordance with
section 416 of the Code and any special rule that will apply based on such
status. In the event that the provisions contained in this Appendix A are
inconsistent with the terms contained in the remainder of the Plan as adopted by
such Employer then, for the Employees employed by such Employer, the provisions
contained in this Appendix A shall take precedence.
1. Definitions.
A. "Applicable Determination Date" means the last day of the
later of the first Plan Year or the preceding Plan Year.
B. "Top-Heavy Ratio" means the ratio of (A) the present value of
the cumulative accrued benefits under the Plan for key
employees to (B) the present value of the cumulative accrued
benefits under the Plan for all key employees and non-key
employees; provided, however, that if an individual has not
performed services for the Employer at any time during the
one-year period ending on the applicable determination date,
any accrued benefit for such individual (and the account of
such individual) shall not be taken into account; and provided
further, that the present values of accrued benefits under the
Plan for an employee as of the applicable determination date
shall be increased by the distributions made with respect to
the employee under the Plan and any plan aggregated with the
Plan under section 416(g)(2) of the Code during the 1-year
period (5-year period in the case of a distribution made for a
reason other than separation from service, death, or
disability) ending on the applicable determination date and
any distributions made with respect to the employee under a
terminated plan which, had it not been terminated, would have
been in the required aggregation group.
C. "Applicable Valuation Date" means the date within the
preceding Plan Year as of which annual Plan costs are or would
be computed for minimum funding purposes.
D. "Key Employee" means any employee or former employee
(including any deceased employee) who at any time during the
Plan Year that includes the Applicable Determination Date was
an officer of an Employer or an Affiliated Entity having
remuneration greater than $130,000 (as adjusted under section
416(i)(1) of the Code for Plan Years beginning after December
31, 2002), a 5% owner (as defined in section 416(i)(1)(B)(i)
of the Code) of an Employer or an Affiliated Entity, or a 1%
owner (as defined in Section 416(i)(1)(B)(ii) of the Code) of
an Employer or an Affiliated Entity) having remuneration
greater than $150,000. The determination of who is a Key
Employee shall be made in accordance with section 416(i) of
the Code and the applicable regulations and other guidance of
general applicability issued thereunder.
E. "Non-Key Employee" means any employee who is not a key
employee.
59
F. "Average Remuneration" means the average annual remuneration
of a Member for the five consecutive years of his Eligibility
Service after December 31, 1983 during which he received the
greatest aggregate remuneration, as limited by section
401(a)(17) of the Code, from the Employer or an Affiliated
Entity, excluding any remuneration for service after the last
Plan Year with respect to which the Plan is Top-Heavy.
G. "Required Aggregation Group" means each other qualified plan
of the Employer or an Affiliated Entity (including plans that
terminated within the 5-year period ending on the Applicable
Determination Date) in which there are members who are key
employees or which enables the Plan to meet the requirements
of section 401(a)(4) or 410 of the Code.
H. "Permissive Aggregation Group" means each plan in the required
aggregation group and any other qualified plan(s) of the
Employer or an Affiliated Employer in which all members are
Non-Key Employees, if the resulting aggregation group
continues to meet the requirements of Sections 401(a)(4) and
410 of the Code.
2. Determination of Top-Heavy Status.
For purposes of this Appendix A, the Plan shall be "Top-Heavy" with
respect to any Plan Year if as of the Applicable Determination Date the
Top-Heavy Ratio exceeds 60%. The Top-Heavy Ratio shall be determined as
of the Applicable Valuation Date in accordance with section
416(g)(3),(4)(B) of the Code on the basis of the 1983 GAM Mortality
Table and an interest rate of 7% per year compounded annually. For
purposes of determining whether the Plan is Top-Heavy, the present
value of accrued benefits under the Plan will be combined with the
present value of accrued benefits or account balances under each other
plan in the Required Aggregation Group, and, in the Employer's
discretion, may be combined with the present value of accrued benefits
or account balances under any other qualified plan(s) in the Permissive
Aggregation Group. The accrued benefit of a Non-Key employee under the
Plan or any other defined benefit plan in the aggregation group shall
be determined (i) under the method, if any, that uniformly applies for
accrual purposes under all plans maintained by the Employer or an
Affiliated Entity, or (ii) if there is no such method, as if such
benefit accrued not more rapidly than the slowest accrual rate
permitted under the fractional rule described in section 411(b)(1)(C)
of the Code.
3. Special Top-Heavy Provisions.
The following provisions shall be applicable to Members for any Plan
Year with respect to which the Plan is Top-Heavy:
A. In lieu of the vesting requirements specified in Subsection
1.40, any Employee who has completed 3 years of Eligibility
Service shall be fully vested in, and have a nonforfeitable
right to, his accrued benefit determined in accordance with
the provisions of Section 4 and paragraph 3.B below.
B. The accrued benefit of an Employee who is a Non-Key Employee
shall not be less than 2% of his Average Remuneration
multiplied by the number of years of his Eligibility Service,
not in excess of 10, during the Plan Years for which the
60
Plan is Top-Heavy. For purposes of the preceding sentence,
years of Eligibility Service shall be disregarded to the
extent that such years of Eligibility Service occur during a
Plan Year when the Plan benefits (within the meaning of
section 410(b) of the Code) no Key Employee or former Key
Employee. That minimum benefit shall be payable at a
Employee's Normal Retirement Date. If payments commence at a
time other than the Employee's Normal Retirement Date, the
minimum accrued benefit shall be the actuarial equivalent of
that minimum benefit.
C. If the Plan is Top-Heavy with respect to a Plan Year and
ceases to be Top-Heavy for a subsequent Plan Year, the
following provisions shall be applicable:
(i) The accrued benefit in any such subsequent Plan Year
shall not be less than the minimum accrued benefit
provided in paragraph C.3 above, computed as of the
end of the most recent Plan Year for which the Plan
was top-heavy.
(ii) If an Employee has completed three years of
Eligibility Service on or before the last day of the
most recent Plan Year for which the Plan was
Top-Heavy, the vesting provision set forth in
paragraph 3.A above shall continue to be applicable.
61
APPENDIX B - SECTION 415 LIMITATIONS
In the event the provisions contained in this Appendix B are inconsistent with
the terms contained in the remainder of the Plan, the provisions of this
Appendix B shall take precedence.
1. Subject to the following provisions of this Appendix B and to the
limitations set forth in section 415 of the Code and any regulations or
rulings thereunder, and notwithstanding any provision of the Plan to
the contrary, the maximum annual pension payable to an Employee under
the Plan in the form of a single life annuity, when added to any
pension attributable to contributions of the Employer or an Affiliated
Entity provided to the Employee under any other qualified defined
benefit plan, shall be equal to the lesser of:
(i) the dollar limitation described in Section 415(b)(1)(A) of the
Code, as in effect for such Limitation Year, taking account
any adjustments made pursuant to Section 415(d)(1)(A) of the
Code, or
(ii) the Participant's average annual remuneration during the 3
consecutive calendar years of his service with the Employer or
Affiliated Entity affording the highest such average, or
during all of the years of such service if less than 3 years.
For purposes of this Appendix B, the Limitation Year shall be the Plan
Year. An Employee shall satisfy the limitation of this subsection if
his annual pension under this Plan is $10,000 or less, and the Employee
has not participated at any time in any defined contribution plan the
Employer has maintained.
The term "remuneration" with respect to any Employee shall mean the his
wages, salaries, and other amounts paid in respect of such Employee by
the Employer or an Affiliated Entity for personal services actually
rendered and shall include, but not by way of limitation, bonuses,
overtime payments, and commissions and shall exclude deferred
compensation, stock options, and other distributions which receive
special tax benefits under the Code. Remuneration shall also include
(i) any elective deferral, as defined in Section 402(g) of the Code and
(ii) any amount contributed by the Employer at the election of the
Employee that is not includible in the gross income of the employee by
reason of Sections 125, 132(f), or 457 of the Code.
2. Payments commencing prior to Age 62:
There shall be no adjustment to the applicable dollar limitation if the
pension commences at or after the Employee's attainment of age 62, but
if the pension begins before the Participant's 62nd birthday, the
Administrator shall adjust the applicable dollar limitation as
determined under Appendix B.1 to the actuarial equivalent of the
maximum benefit payable at age 62.
To determine the Actuarial Equivalent under this subsection, the
Administrator shall use an interest rate assumption equal to the
greater of 5% or the rate specified in Subsection 17.J.
62
3. Payments commencing after Age 65:
In the event an Employee's benefit commences after his attainment of
age 65, the Administrator shall adjust the applicable dollar limitation
as determined under Appendix B.1 to the actuarial equivalent of an
annual benefit equal to such dollar limitation commencing at such
Employee's attainment of age 65. To determine the actuarial equivalent
under this subsection, the Administrator shall use an interest rate
assumption equal to the lesser of 5% or the rate specified in
Subsection 17.J.
4. In the case of an Employee whose benefits have not yet commenced, the
benefit payable to a employee's spouse under a qualified joint and
survivor annuity or under a qualified preretirement survivor annuity
shall be subject to the dollar limitation which would apply if the
benefits were payable to the employee in the form of a life annuity.
The amount of the benefit payable to the spouse, and which is subject
to the preceding sentence, shall be computed from the Employee's before
application of this subsection.
5. If an Employee's is payable neither as a life annuity nor as a
qualified joint and survivor annuity with the Employee's spouse as
beneficiary, the maximum limitation shall be the actuarial equivalent
of the maximum limitation otherwise applicable. The actuarial
equivalent for purposes of this subsection shall be determined in
accordance with section 415(b) of the Code and the regulations or
rulings issued thereunder and using the Plan's early retirement, late
retirement or optional benefit factors as appropriate, or, if less,
using factors calculated from the mortality table specified in
Subsection 10.J, if applicable, and (i) with respect to an adjustment
for certain forms of benefit under Section 415(b)(2)(B) of the Code,
the interest rate specified in Subsection 10.J, if the pension is
subject to the provisions of Section 417(e)(3) of the Code or 5%
otherwise; and (ii) with respect to any other adjustment for
commencement of benefits before age 62 or after age 65, required under
Code section 415(b)(2)(C) or (D), an interest rate of 5%.
6. The maximum annual pension described in Appendix B.1 shall be applied
to an Employee who has completed at least 10 years of Eligibility
Service, for purposes of the 100% of average annual remuneration
limitation and the $10,000 special limitation, and who has completed at
least 10 Years of Credited Service, for purposes of the dollar amount
limitation. If a Employee has completed less than 10 years of
Eligibility Service at the time benefits commence, the Administrator
shall multiply the Employee's 100% average annual remuneration
limitation and the $10,000 special limitation by a fraction, the
numerator of which is the number of years of Eligibility Service
(including fractional years) and the denominator of which is 10. If an
Employee has less than ten 10 years of Credited Service at the time his
benefits commence, the Administrator shall multiply the Employee's
dollar amount limitation by a fraction, the numerator of which is the
number of years of Credited Service (including fractional years) and
the denominator of which is 10. In no event will the reductions
described in this subsection reduce an Employee's maximum annual
pension to less than 10% of the maximum annual pension determined
without regard to the reductions. To the extent required by the Income
Tax Regulations, the Administrator shall apply the reductions of this
paragraph separately to each change in the benefit structure of the
Plan.
63
7. Pursuant to section 1.415-3(d)(1) of the Income Tax Regulations,
Employee contributions are considered a separate defined contribution
plan maintained by the Employer that is subject to the limitations on
contributions and other additions described in section 1.415-6 of the
Income Tax Regulations. In the event these limitations are exceeded,
any required return of excess amounts shall be made from this Plan only
after such return is made from any other defined contribution plan of
the Employer or Employer's Controlled Group.
64
APPENDIX C - HISTORICAL FORMULAS
The purpose of this Appendix C is to provide a brief outline of how monthly
pension amounts were accrued through December 31, 1993 under the Predecessor
Plan (and those plans, including the GESCO Plan, from which the Predecessor Plan
received a transfer of assets and liabilities). More specific details for any
particular year can be found in the Plan document, which was in effect at that
time.
Prior to January 1, 1992, the Plan consisted of a Basic Portion and a
Supplemental Portion. All Employees earned benefits under the Basic Portion.
Only Employees who were hired before January 1, 1980 and who became Salaried
Employees by August 1, 1985 were eligible to participate in the Supplemental
Portion (hereinafter referred to as Pre-1980 Salaried Employees).
Under the Basic Portion of the Plan, monthly pension amounts were determined
using two different methods -- the Career Accumulafion method and the Final
Average Compensation Method. An Employee's accrued pension under the Basic
Portion was the larger of these two amounts. Any pension accrued under the
Supplemental Portion of the Plan was then added to this amount to arrive at an
Employee's total monthly accrued pension.
When the Plan was restructured effective January 1, 1992, the benefits earned as
of December 31, 1991 under the Basic and Supplemental Portions were combined to
form a new Career Accumulation base. This Appendix C includes the tables and
formulas that were used to determine accrued pension amounts under the Basic and
Supplemental Portions of the Plan through December 31, 1991. Also included are
the Career Accumulation formulas and the FAC formulas for the period January 1,
1992 through December 31, 1993.
A. Basic Portion -- Career Accumulation Method
An Employee's accrued pension under this method is the sum of
amounts from A.1 through A.11 below, where applicable.
Monthly Pensions for Calendar Years Through 12/31/82
----------------------------------------------------
An Employee's position on all of the tables shown in A.3 through A.7
below for any calendar year was determined by the third quarter average
earned rate from the previous year for Hourly-Paid Employees and by the
December 1 rate of pay from the previous year for Salaried Employees.
Hourly Weekly Monthly Monthly
Years Rate Rate Rate Pension
----- --------- --------- -------- -------
A.1 Prior to 1967 All All All $ 6.00
A.2 1967 through 1971 All All All $ 8.00
A.3 1972 Up to $4.50 Up to $180 Up to $783 $ 8.00
65
$4.50 & over $180 & over $783 & over 8.50
A.4 1973,1974,1975 Up to $4.50 Up to $180 Up to $783 $ 8.00
$4.50 to 4.75 $180 to $190 $783 to $826 8.50
4.75 to 5.00 190 to 200 826 to 870 9.00
5.00 to 5.25 200 to 210 870 to 913 9.50
5.25 & over 210 & over 913 & over 10.00
A.5 1976,1977,1978 Up to $4.50 Up to $180 Up to $783 $ 8.00
$4.50 to 4.75 $180 to 190 $783 to 826 8.50
4.75 to 5.00 190 to 200 826 to 870 9.00
5.00 to 5.25 200 to 210 870 to 913 9.50
5.25 to 5.50 210 to 220 913 to 957 10.00
5.50 to 5.75 220 to 230 957 to 1000 10.50
5.75 to 6.00 230 to 240 1000 to 1044 11.00
6.00 to 6.25 240 to 250 1044 to 1087 11.50
6.25 & over 250 & over 1087 & over 12.00
A.6 1979 Up to $4.50 Up to $180 Up to $783 $ 8.00
$4.50 to 4.75 $180 to 190 $783 to 826 8.50
4.75 to 5.00 190 to 200 826 to 870 9.00
5.00 to 5.25 200 to 210 870 to 913 9.50
5.25 to 5.50 210 to 220 913 to 957 10.00
5.50 to 5.75 220 to 230 957 to 1000 10.50
5.75 to 6.00 230 to 240 1000 to 1044 11.00
6.00 to 6.25 240 to 250 1044 to 1087 11.50
6.25 to 6.50 250 to 260 1087 to 1131 12.00
6.50 to 6.75 260 to 270 1131 to 1174 12.50
6.75 to 7.00 270 to 280 1174 to 1218 13.00
7.00 to 7.25 280 to 290 1218 to 1261 13.50
7.25 & over 290 & over 1261 & over 14.00
A.7 Prior to 1980, the Basic Portion was noncontributory for all
Employees. For the period from January 1, 1980 through
December 31, 1982, all nonrepresented Employees and some
represented Employees had an option to contribute under the
Basic Portion. Certain other represented Employees did not
have the option to contribute.
For the years 1980, 1981 and 1982, the table shown above in
paragraph A.6 for the year 1979 remained in effect both for
those who did not have an option to contribute and for those
who were hired prior to January 1, 1980 who had an option to
contribute but who chose not to do so. Those who were hired
between January 1, 1980 and December 31, 1982 who had an
option to contribute but chose not to do so did not accrue any
benefits.
66
For those who were hired Prior to January 1, 1980 who elected
to contribute, the following table applied for the years 1980,
1981 and 1982:
Hourly Weekly Monthly Monthly
Rate Rate Rate Pension
------ ------ ------- -------
Up to $4.95 Up to $198 Up to $858 $ 9.50
$4.95 to 5.25 $198 to 210 $858 to 910 10.00
5.25 to 5.55 210 to 222 910 to 962 10.50
5.55 to 5.85 222 to 234 962 to 1014 11.00
5.85 to 6.15 234 to 246 1014 to 1066 11.50
6.15 to 6.45 246 to 258 1066 to 1118 12.00
6.45 to 6.75 258 to 270 1118 to 1170 13.15
Increasing by Increasing by Increasing by Increasing
$0.30 without $12 without $52 without by $1.15
limit limit limit without limit
for Hourly-
Paid
Employees
Increasing
by $1.15 to a
maximum of
$21.20 for
Salaried
Employees
For those who were hired on or after January 1, 1980 who
elected to contribute, the following table applied for the
years 1980, 1981 and 1982:
Hourly Weekly Monthly Monthly
Rate Rate Rate Pension
------ ------ ------- -------
Up to $4.95 Up to $198 Up to $858 $10.80
$4.95 to 5.25 $198 to 210 $858 to 910 11.95
Increasing by Increasing by Increasing by Increasing
$0.30 without $12 without $52 without by $1.15
limit limit limit without
limit
A.8 Past Service Update Effective 12/31/82:
On December 31, 1982, the sum of all monthly amounts earned in
A.1 through A.7 above was increased by 25%, plus $4.17.
A.9 Monthly Pensions for Calendar Years from 1/1/83 Through
12/31/91:
67
For those Employees who elected to contribute during the
period January 1, 1983 through December 31, 1991, the pension
amounts were based on various formulas, which were applied to
total compensation received during each calendar year, with an
overall minimum of $15 per year of Credited Service. The
following were the formulas:
a. For calendar years 1983 through 1988:
1/12 of 1.30% of total compensation up to $14,700,
plus 2.4% of total compensation in excess of $14,700.
For Pre-1980 Salaried Employees, the following
maximums applied for the indicated years:
1983 $28.23
1984 and 1985 $33.03
1986 $36.63
1987 and 1988 $39.03
b. For calendar years 1989 through 1991:
1/12 of 1.75% of total compensation up to $14,700,
plus 2.2% of total compensation in excess of $14,700.
If the Employee had 35 or more years of Credited
Service at the beginning of the calendar year, the
formula was 1/12 of 1.75% of total compensation.
For Pre-1980 Salaried Employees, the maximums were:
$40.00 for less than 35 years of Credited Service
$36.20 for 35 or more years of Credited Service
A.10 Monthly Pensions for Non-Contributors from 1/1/80 Through
12/31/91:
Those who were hired between January 1, 1980 and December
31, 1982 who had an option to contribute but chose not to do
so were granted a monthly pension of $14 times Credited
Service accumulated to December 31, 1982. The Past Service
Update effective December 31, 1982 did not apply to this
group.
A.11 From January 1, 1983 through December 31, 1991, all Employees
had the option to contribute under the Basic Portion. For any
year in which an Employee elected not to contribute, the
accrued monthly pension was $15 times Credited Service
accumulated during that year.
B. Basic Portion -- Final Average Compensation (FAC) Method:
68
As of December 31, 1991, an Employee's accrued pension under this
method is the monthly pension amount from the following schedule times
years of Credited Service as a contributor. Prior to December 31, 1991,
there were different FAC schedules in effect; refer to earlier Plan
documents to determine accrued pensions under this method before
December 31, 1991.
FAC Schedule at 12/31/91:
Note: If an Employee elected to contribute when first eligible, the
Employee is treated as a contributor for all previous years.
Final Average Monthly Pension for
Compensation Each Year of Credited Service
Over Up to
---- -----
$24,750 $21.00
$24,750 25,050 21.25
25,050 25,350 21.50
25,350 25,650 21.75
25,650 25,950 22.00
25,950 26,250 22.25
26,250 26,550 22.50
26,550 26,850 22.75
26,850 27,150 23.00
27,150 27,450 23.25
27,450 27,750 23.50
27,750 28,050 23.75
28,050 28,350 24.00
28,350 28,650 24.25
28,650 28,950 24.50
28,950 29,250 24.75
29,250 29,550 25.00
29,550 29,850 25.25
29,850 30,150 25.50
30,150 30,450 25.75
30,450 30,750 26.00
30,750 31,050 26.25
31,050 31,350 26.50
31,350 31,650 26.75
31,650 27.00
Monthly Pensions for Non-Contributors
For any year during which an Employee was considered a non-contributor,
the FAC pension amount is $13 times the Credited Service accumulated in
that year.
C. Supplemental Portion:
Under the Supplemental Portion of the Plan, monthly pensions were based
on earnings class numbers from the inception of the Plan through
December 31, 1988.
69
From January 1, 1989 through December 31, 1991, pensions were
determined by a formula based on total compensation.
An Employee's accrued pension is the sum of amounts from C.1 through
C.3, where applicable.
C.1 Monthly Pensions for Calendar Years Through 12/31/88:
For each full year of service prior to January 1, 1989, an
Employee who contributed to the Supplemental Portion earned a
monthly pension amount equal to the earnings class number
multiplied by one dollar and five cents ($1.05). The following
is a summary of the schedules that were used to determine
earnings class numbers since the inception of the Plan.
Earnings Monthly Pay Range in Indicated Years
Class ------------------------------------
Number 1951 through 1966 1967 through 1985 1986 through 1988
- ------ ----------------- ----------------- -----------------
1 $400 but less than $475 $ 0 but less than $550 $ 0 but less than $825
2 $475 but less than $525 $550 but less than $625 $825 but less than $875
3 $525 but less than $575 $625 but less than $675 $875 but less than $925
4 $575 but less than $625 $675 but less than $725 $925 but less than $975
5 $625 but less than $675 $725 but less than $775 $975 but less than $1025
Add one earnings class number for each $50 increase in pay.
For the years 1951, 1952 and 1953, an Employee's earnings
class number was based on the earnings for the first nine
months of the previous year multiplied by 1 1/3. For the years
1954 through 1988, an Employee's earnings class number was
based on the base salary rate in effect on December 1 of the
previous year.
C.2 Past Service Update Effective 3/1/88:
For each Employee who was accruing Eligibility Service on or
after February 29, 1988, an amount was determined in
accordance with step (g) of the following calculation:
(a) Determine all of the amounts earned pursuant to
paragraph C.1 above as of December 31, 1987.
(b) Subtract 7 years from the Eligibility Service accrued
by the Employee as of December 31, 1987 (in no event
shall the result be less than zero).
(c) Determine the product of 0.025 times (a) times (b).
(d) Determine the amount of monthly pension the Employee
had accrued as of December 31, 1987, pursuant to
paragraph A of this Appendix C.
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(e) Determine the amount of monthly pension the Employee
had accrued under the Basic Portion of the Plan as of
December 31, 1987 under the Final Average
Compensation Method of computing pensions. For any
year during which the Employee was considered a
noncontributor, this amount is $13 times the Credited
Service accumulated in that year. For any year during
which the Employee was considered a contributor the
monthly pension was based on the following table:
Monthly Pension
Final Average for Each Year of
Compensation Credited Service
Over Up to
---- -----
$19,350 $16.00
$19,350 19,650 16.25
19,650 19,950 16.50
19,950 20,250 16.75
20,250 20,550 17.00
20,550 20,850 17.25
20,850 21,150 17.50
21,150 21,450 17.75
21,450 21,750 18.00
21,750 22,050 18.25
22,050 22,350 18.50
22,350 22,650 18.75
22,650 22,950 19.00
22,950 23,250 19.25
23,250 23,550 19.50
23,550 23,850 19.75
23,850 24,150 20.00
24,150 24,450 20.25
24,450 24,750 20.50
24,750 25,050 20.75
25,050 25,350 21.00
25,350 25,650 21.25
25,650 25,950 21.50
25,950 26,250 21.75
26,250 22.00
(f) Subtract the amount determined in (d) from the amount
determined in (e) (in no event shall the result be
less than zero).
(g) Subtract the amount determined in (f) from the amount
determined in (c) (in no event shall the result be
less than zero).
C.3 Monthly Pensions for Calendar Years From 1/1/89 Through
12/31/91:
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For calendar years 1989 through 1991, an Employee who contributed to
the Supplemental Portion earned a monthly pension in accordance with
the following formula:
1/12 of 1.35% of total compensation up to $24,825, plus 2.1%
of total compensation in excess of $24,825.
D. Restructured Plan Effective January 1,1992:
Career Accumulation Method
From January 1, 1992 through December 31, 1993, all Employees had the
option to contribute to the Plan. If an Employee elected not to
contribute, he accrued a monthly pension of $15 times Credited Service.
If he elected to contribute, he earned a monthly pension of one-twelfth
(1/12) of two percent (2%) of Compensation for each year of Credited
Service.
Final Average Compensation (FAC) Method:
If the Employee elected not to contribute, he accrued a monthly pension
of $13 times Credited Service. If he elected to contribute, his FAC
amount as of December 31, 1993 was based on the schedule shown in
Section 19.
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APPENDIX D - PARTICIPATING EMPLOYERS
The following entities are participating Employers under the Plan:
No additional entities