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EXHIBIT (c)(6)
ACORDIA
401(k) LONG TERM SAVINGS INVESTMENT PLAN
(RESTATED EFFECTIVE OCTOBER 21, 1992)
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TABLE OF CONTENTS
Page
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ARTICLE I
INTRODUCTION
ARTICLE II
DEFINITIONS AND CONSTRUCTION
Definitions ............................................................................ 2
2.1 Accounts.................................................................... 2
2.2 Acordia Stock............................................................... 2
2.3 Actual Contribution Percentage.............................................. 2
2.4 Actual Deferral Percentage.................................................. 2
2.5 Affiliate................................................................... 2
2.6 Annual Additions............................................................ 3
2.7 Before Tax Contributions.................................................... 3
2.8 Before Tax Matched Account.................................................. 3
2.9 Before Tax Matched Contributions............................................ 3
2.10 Before Tax Supplemental Account............................................. 3
2.11 Before Tax Supplemental Contributions....................................... 4
2.12 Beneficiary................................................................. 4
2.13 Board of Directors.......................................................... 4
2.14 Code........................................................................ 4
2.15 Company..................................................................... 4
2.16 Company Account............................................................. 4
2.17 Compensation................................................................ 4
2.18 Disabled or Disability...................................................... 5
2.19 Effective Date.............................................................. 5
2.20 Eligible Employee........................................................... 5
2.21 Eligible Participant........................................................ 6
2.22 Employee.................................................................... 6
2.23 Employer.................................................................... 6
2.24 Employer Matched Account.................................................... 6
2.25 Employer Matched Contributions.............................................. 6
2.26 Employment Commencement Date................................................ 6
2.27 Entry Date.................................................................. 6
2.28 ERISA....................................................................... 6
2.29 Excess Aggregate Contributions.............................................. 6
2.30 Excess Contributions........................................................ 7
2.31 Family Member............................................................... 7
2.32 Fiduciary................................................................... 7
2.33 Forfeiture.................................................................. 7
2.34 Former Participant.......................................................... 7
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2.35 Full-Time Employee.......................................................... 7
2.36 Highly Compensated Eligible Participant..................................... 7
2.37 Highly Compensated Employee................................................. 7
2.38 HMI Company Regular Account................................................. 9
2.39 Hours of Service............................................................ 9
2.40 Income...................................................................... 10
2.41 Investment Funds............................................................ 11
2.42 Investment Manager.......................................................... 11
2.43 Leased Employee............................................................. 11
2.44 Limitation Year............................................................. 11
2.45 Merged Plan................................................................. 11
2.46 Merged Plan I............................................................... 11
2.47 Merged Plan II.............................................................. 11
2.48 Merged Plan III............................................................. 11
2.49 Merged Plan IV.............................................................. 11
2.50 Merged Plan V............................................................... 12
2.51 Merged Plan VI.............................................................. 12
2.52 Normal Retirement Age....................................................... 12
2.53 Normal Retirement Date...................................................... 12
2.54 Participant................................................................. 12
2.55 Participating Employer...................................................... 12
2.56 Part-Time Employee.......................................................... 12
2.57 Pension Committee........................................................... 12
2.58 Period of Service........................................................... 12
2.59 Period of Severance......................................................... 12
2.60 Plan........................................................................ 13
2.61 Plan Year................................................................... 13
2.62 Post 1986 After Tax Contribution Account.................................... 13
2.63 Post 1986 After Tax Contributions........................................... 13
2.64 Pre 1987 After Tax Contribution Account..................................... 13
2.65 Pre 1987 After Tax Contributions............................................ 14
2.66 QNEC(s...................................................................... 14
2.67 QNEC Account................................................................ 14
2.68 Raff-Hughes Company Regular Account......................................... 14
2.69 Raff-Hughes Plan............................................................ 14
2.70 Retirement.................................................................. 14
2.71 Rollover Account............................................................ 14
2.72 Severance From Service Date................................................. 14
2.73 Shelby Pension Transfer Account............................................. 14
2.74 Spouse (surviving spouse)................................................... 14
2.75 Temporary Employee.......................................................... 15
2.76 Terminated or Termination................................................... 15
2.77 Trust (or Trust Fund)....................................................... 15
2.78 Trust Agreement............................................................. 15
2.79 Trustee..................................................................... 15
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2.80 Valuation Date.............................................................. 15
Construction................................................................ 15
ARTICLE III
PARTICIPATION AND SERVICE
3.1 Continuing Participation.................................................... 16
3.2 Eligibility to Participate.................................................. 16
3.3 Change in Active Status..................................................... 16
3.4 Special Rules for Participation and Vesting Purposes........................ 16
3.5 Participation and Service upon Reemployment................................. 17
3.6 Cessation of Participation.................................................. 17
3.7 Transfers From Affiliates and Change in Status.............................. 17
3.8 Transfers To and From The Associated Group.................................. 17
ARTICLE IV
CONTRIBUTIONS
4.1 Employer Contributions...................................................... 19
4.2 Post 1986 After Tax Contributions........................................... 21
4.3 Time and Manner of Contribution............................................. 21
4.4 Conditions on Employer Contributions........................................ 22
4.5 Change in Amount of Before Tax or Post 1986 After Tax
Contributions............................................................... 22
4.6 Limitations on Before Tax Contributions..................................... 23
4.7 Income Attributable to Excess Contributions................................. 25
4.8 Limitations on Employer Matched and Post 1986 After Tax
Contributions............................................................... 26
4.9 Income Attributable to Excess Aggregate Contributions....................... 28
4.10 Combined Limitation......................................................... 28
4.11 Rollovers................................................................... 28
4.12 Requirements for Qualified Non-Elective Contributions and
Qualified Matching Contributions............................................ 29
ARTICLE V
ALLOCATIONS TO PARTICIPANTS' ACCOUNTS
5.1 Individual Accounts......................................................... 30
5.2 Account Adjustments (Effective for Valuation Dates Occurring
Prior to January 1. 1994)................................................... 30
5.3 Account Adjustments (Effective for Valuation Dates on or After
January 1, 1994)............................................................ 32
5.4 Maximum Annual Additions.................................................... 33
5.5 No Rights Created by Allocation............................................. 35
ARTICLE VI
PAYMENT OF BENEFITS
6.1 Retirement or Disability.................................................... 36
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6.2 Death....................................................................... 36
6.3 Other Termination of Employment............................................. 36
6.4 Vesting..................................................................... 36
6.5 Disposition of Forfeitures.................................................. 37
6.7 Mode and Method of Payment of Benefits...................................... 40
6.8 Designation of Beneficiary.................................................. 41
6.9 Withdrawals................................................................. 42
6.10 Loans to Participants....................................................... 45
6.11 Direct Rollover Option...................................................... 47
ARTICLE VII
TRUST FUND
7.1 Exclusive Benefit of Eligible Employees and Beneficiaries................... 49
7.2 Investment Directions by Participants....................................... 49
7.3 Acordia Stock............................................................... 52
7.4 Special Rules Applicable to Persons Subject to Section 16(b) of
the Securities Exchange Act of 1934......................................... 53
ARTICLE VIII
ADMINISTRATION
8.1 Duties and Responsibilities of Fiduciaries; Allocation of
Responsibility Among Fiduciaries for Plan and Trust
Administration.............................................................. 56
8.2 Allocation of Duties and Responsibilities................................... 56
8.3 Expenses.................................................................... 56
8.4 Claims Procedure............................................................ 56
8.5 Records and Reports......................................................... 58
8.6 Other Powers and Duties..................................................... 58
8.7 Rules and Decisions......................................................... 59
8.8 Authorization of Benefit Payments........................................... 59
8.9 Application and Forms for Benefits.......................................... 59
8.10 Facility of Payment......................................................... 59
8.11 Indemnification............................................................. 60
8.12 Resignation or Removal of the Pension Committee............................. 60
8.13 Notices and Forms........................................................... 60
ARTICLE IX
MISCELLANEOUS
9.1 No Guarantee of Employment.................................................. 61
9.2 Rights to Trust Assets...................................................... 61
9.3 No Alienation of Benefits................................................... 61
9.4 Discontinuance of Employer Contributions.................................... 61
ARTICLE X
AMENDMENTS AND ACTION BY COMPANY
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10.1 Amendments Generally........................................................ 62
10.2 Amendments to Vesting Schedule.............................................. 62
10.3 Action by Company........................................................... 63
ARTICLE XI
SUCCESSOR EMPLOYER AND MERGER OR
CONSOLIDATION OF PLANS
11.1 Successor Employer.......................................................... 64
11.2 Plan Assets................................................................. 64
11.3 Merged Plans................................................................ 64
ARTICLE XII
PLAN TERMINATION
12.1 Right to Terminate.......................................................... 65
12.2 Liquidation of the Trust Fund............................................... 65
12.3 Manner of Distribution...................................................... 65
ARTICLE XIII
DETERMINATION OF TOP-HEAVY STATUS
13.1 General..................................................................... 66
13.2 Top-Heavy Plan.............................................................. 66
13.3 Super Top-Heavy Plan........................................................ 66
13.4 Cumulative Accrued Benefits and Cumulative Accounts......................... 66
13.5 Definitions................................................................. 66
13.6 Vesting..................................................................... 67
13.7 Compensation................................................................ 67
13.8 Minimum Contributions....................................................... 67
13.9 Defined Benefit and Defined Contribution Plan Fractions..................... 68
APPENDIX A
EXHIBIT A
EXHIBIT B
EXHIBIT C
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ACORDIA
401(k) LONG TERM SAVINGS INVESTMENT PLAN
ARTICLE I
INTRODUCTION
The Acordia 401(k) Long Term Savings Investment Plan (the "Plan") is established
and maintained in accordance with the terms of this instrument. The assets of
this Plan are held by the Trustee in accordance with the terms of the Trust
Agreement, which is considered to be an integral part of this Plan. Except as
otherwise provided herein or in the Trust Agreement, the Trustee has the
exclusive authority to manage and control the assets of this Plan. Except as
otherwise provided herein, this amended and restated plan applies to those
Participants who are credited with an Hour of Service with an Employer on or
after the effective date of the Initial Public Offering of the Company (the
"Effective Date"). As of the Effective Date, this Plan accepted a transfer of
assets and liabilities from The Associated Group 401(k) Long Term Savings
Investment Plan (the "TAG Savings Plan").
The rights of those individuals (or their beneficiaries) who terminated
employment with an Employer prior to the Effective Date are governed by the
terms and conditions of the TAG Savings Plan in effect prior to such date.
The Plan is hereby designated as a profit sharing plan for purposes of Section
401(a)(27)(B) of the Code. The Plan is intended to be a tax qualified plan under
Section 401(a) of the Code, and its associated trust is intended to be a
tax-exempt trust under Section 501(a) of the Code.
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ARTICLE II
DEFINITIONS AND CONSTRUCTION
Definitions. The following words and phrases, when used in this Plan, shall have
the following meanings:
2.1 Accounts means a Participant's Before Tax Matched Account, Before Tax
Supplemental Account (effective January 1, 1994, the Before Tax Matched
and Before Tax Supplement Accounts were merged into the Before Tax
Account), Employer Matched Account, Raff-Hughes Company Regular
Account, HMI Company Regular Account, Shelby Pension Transfer Account,
Post 1986 After Tax Contribution Account, Pre 1987 After Tax
Contribution Account, Rollover Account, Company Account and QNEC
Account.
2.2 Acordia Stock means common stock of the Company.
2.3 Actual Contribution Percentage means, for a specified group of Eligible
Participants for a given Plan Year, the average of the ratios,
calculated separately for each Eligible Employee in such group, of: (i)
the sum of the Employer Matched Contributions, if any, contributed by
an Employer on behalf of each such Eligible Participant and After Tax
Contributions made by each Eligible Participant for the Plan Year; to
(ii) the Eligible Participant's Compensation for such Plan Year.
2.4 Actual Deferral Percentage means, for a specified group of Eligible
Participants for a given Plan Year, the average of the ratios,
calculated separately for each Eligible Participant in such group, of:
(i) the Before Tax Contribution, if any, contributed by the Employer on
behalf of each such Eligible Participant for the Plan Year; to (ii) the
Eligible Participant's Compensation for such Plan Year.
2.5 Affiliate means any employer that has not adopted this Plan and is not
a Participating Employer, but, in accordance with the appropriate
Sections of the Code, (i) is included as a member with the Company in a
controlled group of corporations, (ii) is a trade or business (whether
or not incorporated) included with the Company in a brother-sister
group or combined group of trades or businesses under common control,
(iii) is a member of an affiliated service group in which the Company
is a member, or (iv) any other organization which must be aggregated
with the Company pursuant to Section 414(o) of the Code. With respect
to periods prior to the Effective Date, for Participants or Former
Participants whose pension assets and liabilities were transferred to
this Plan from the TAG Savings Plan as of the Effective Date (and for
Eligible Employees who were employed by an "employer" or "affiliate"
under the TAG Savings Plan prior to the Effective Date but were not yet
participating in that plan on such date), affiliate shall also include
Associated Insurance Companies, Inc. and any other
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company that was an "affiliate" as defined in the TAG Savings Plan on
the Effective Date.
2.6 Annual Additions means, with respect to each imitation Year, the
additions to a Participant's Account as defined below:
(i) Employer contributions;
(ii) forfeitures;
(iii) (A) for Limitation Years before January 1, 1987, the lesser of
(a) Participant's After Tax Contributions in
excess of 6% of Compensation for such
Limitation Year; or
(b) 50% of Participant's After Tax Contributions
allocated to the Accounts of the Participant
with respect to such Limitation Year; and
(B) for Limitation Years beginning after December 31, 1986,
Participant's After Tax Contributions allocated to the
Accounts of the Participant with respect to such
Limitation Year.
(iv) allocations to individual medical accounts established for the
Participant, who is a Key Employee as defined in Section 13.5,
under a defined benefit plan as provided in Section 415(1) of the
Code and any amount attributable to post-retirement medical
benefits allocated to an account established under Section
419A(d)(1) of the Code for such Participant.
2.7 Before Tax Contributions means a Participant's Before Tax Matched and
Before Tax Supplemental Contributions.
2.8 Before Tax Matched Account means the account maintained for a
Participant to record (i) his share of Before Tax Matched Contributions
under Section 4.1(a)(i); (ii) his share of before tax matched
contributions under Merged Plans I, II, IV or V, if any; (iii) his
share of before tax matched contributions that he made under the
Raff-Hughes Plan, which he has elected to transfer to this Plan, if
any; and (iv) adjustments relating thereto.
2.9 Before Tax Matched Contributions means the contributions made by the
Employer on a Participant's behalf pursuant to Section 4.1(a)(i).
2.10 Before Tax Supplemental Account means the account maintained for a
Participant to record (i) his share of Before Tax Supplemental
Contributions under Section
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4.1(a)(ii); (ii) his share of before tax supplemental contributions
under Merged Plans I, II, III, IV or V, if any; and (iii) adjustments
relating thereto.
2.11 Before Tax Supplemental Contributions means the contributions made by
the Employer pursuant to Section 4.1(a)(ii).
2.12 Beneficiary means a person or persons (natural or otherwise) designated
by a Participant in accordance with the provisions of Section 6.8 to
receive any death benefit which shall be payable under this Plan.
2.13 Board of Directors means the board of directors of the Company.
2.14 Code means the Internal Revenue Code of 1986, as it may be amended, and
includes any regulations or other rulings issued thereunder.
2.15 Company means Acordia, Inc., and any other business organization which
succeeds to its business and elects to continue the Plan.
2.16 Company Account means the account maintained for a Participant to
record (i) his share of discretionary Employer Contributions under
Merged Plan III and IV, if any; (ii) transferred contributions
allocated to a Participant's "Transfer Account" under Merged Plan IV,
if any; and (ii) adjustments relating thereto.
2.17 Compensation means, for any Plan Year base salary, commissions,
overtime pay and cash bonuses actually received by a Participant.
Compensation shall also include cash received under the Employer's
flexible benefits program and the amount of any elective deferrals the
Participant has authorized the Employer to make on his behalf under the
plans maintained by the Employer in accordance with Sections 125 and
401(k) of the Code but shall exclude all other forms of compensation
such as imputed income, car allowances, non-qualified deferred
compensation, severance payments, payments under the directed executive
compensation program and income from the exercise of qualified or
non-qualified stock options or similar items.
In no event shall a Participant's Compensation considered under the
Plan exceed the amount set forth in Section 401(a)(17) of the Code, as
adjusted for increases in the cost of living.
For purposes of Sections 4.1 and 4.2, notwithstanding any provision in
this Plan to the contrary, for purposes of determining Before Tax
Contributions and Employer Matched Contributions for a Participant,
Compensation shall include such Participant's Compensation during each
pay period beginning with the Entry Date coincident with or next
following participation in the Plan pursuant to Section 3.2; or if the
individual elects to authorize Before Tax Contributions to the
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Plan at a later date, the Participant's Compensation during each pay
period beginning with the pay period with respect to which such
election is first effective.
For purposes of Sections 4.6 and 4.8, Compensation shall mean, with
respect to any determination period, a definition of Compensation
selected by the Pension Committee in accordance with, and from among
alternatives permissible under, Treas. Reg. 1.414(s)-lT (for years
prior to September 19, 1991) and 1.414(s)-1 or any successor thereto.
Any definition of Compensation selected by the Pension Committee for
use in satisfying the requirements of Section 4.6 or 4.8 for a
determination period shall be used consistently to define the
Compensation of all Employees to be taken into account in satisfying
those requirements for that determination period.
2.18 Disabled or Disability means:
(i) In the case of a Participant who is covered by the Employer's
long-term disability plan, the total incapacity of the
Participant due to a physical or mental condition which qualifies
the Participant for benefits under the Employer's long-term
disability plan whether or not the benefit under the long-term
disability plan has been paid as a single sum amount; and
(ii) In the case of a Participant who is not covered by the Employer's
long-term disability plan, a physical or mental condition, which
in the sole opinion of the Pension Committee, renders the
Participant incapable of performing the duties of any position
for which he is reasonably qualified in light of his education
and employment experience.
(iii) The Pension Committee may require the Participant to be examined
by a duly licensed physician selected by the Pension Committee
before making its determination that the Participant is disabled
and not more frequently than annually thereafter to determine
whether the Participant continues to be Disabled.
2.19 Effective Date means October 21, 1992.
2.20 Eligible Employee means a Full-Time, Part-Time or Temporary Employee
who is employed by the Employer. A non-resident alien who receives no
income from sources within the United States shall not be deemed to be
an Eligible Employee. Any Employee who is included in a unit of
employees covered by a negotiated collective bargaining agreement where
there exists evidence that retirement benefits were the subject of good
faith bargaining, shall not be deemed to be an Eligible Employee,
unless the agreement provides for participation in the Plan. A Leased
Employee shall not be deemed to be an Eligible Employee. An individual
whose income from an Employer is reported on Form 1099 shall not be
deemed to be an Eligible Employee. An individual hired as a Temporary
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Employee on or after January 1, 1994 shall not be deemed to be an
Eligible Employee. An Eligible Employee whose employment status is
changed to that of a Temporary Employee on or after January 1, 1994
shall not be permitted to make additional Before Tax Contributions
after such status change.
2.21 Eligible Participant means as of each Entry Date, each Eligible
Employee who has met the requirements for participation in the Plan
regardless of whether he has authorized the Employer to make Before Tax
Contributions or Post 1986 After Tax Contributions on his behalf to the
Plan.
2.22 Employee means any individual employed by the Employer as a common law
employee. A Leased Employee shall be deemed to be an Employee.
2.23 Employer means the Company and any Participating Company which, with
the approval of the Board of Directors, has adopted this Plan. With
respect to periods prior to the Effective Date, the Participants or
Former Participants whose savings plan assets and liabilities were
transferred to the Plan from the TAG Savings Plan as of the Effective
Date (and for Eligible Employees who were employed by an "employer" or
"affiliate" under the TAG Savings Plan prior to the Effective Date but
were not yet participating in that plan on such date). Employer shall
also include Associated Insurance Companies, Inc. and any other company
that was an "employer" as defined in the TAG Savings Plan on the
Effective Date.
2.24 Employer Matched Account means the account maintained for a Participant
to record (i) his share of Employer Matched Contributions under Section
4.1(b); (ii) his share of matching contributions under Merged Plan I,
II, IV and V, if any; and (iii) adjustments relating thereto.
2.25 Employer Matched Contributions means the contributions made by the
Employer on a Participant's behalf pursuant to Section 4.1(b).
2.26 Employment Commencement Date means the first day on which an Eligible
Employee is credited with an Hour of Service.
2.27 Entry Date means the first day of each calendar month, and effective
April 1, 1993, every day.
2.28 ERISA means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any regulations promulgated thereunder.
2.29 Excess Aggregate Contributions means with respect to each Plan Year,
the amount determined for Highly Compensated Eligible Participants
under the procedure set forth in Treas. Reg. 1.401(m)-l(e)(2) or any
successor thereto.
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2.30 Excess Contributions means with respect to each Plan Year, the amount
determined for Highly Compensated Eligible Participants under the
procedure set forth in Treas. Reg. 1.401(k)-l(f)(2) or any successor
thereto.
2.31 Family Member means, with respect to each Highly Compensated Employee
who owns a 5% interest in an Employer or is in the group consisting of
the 10 most Highly Compensated Employees, the spouse, lineal
descendants or ascendants and their spouses of such Highly Compensated
Employee who are Employees; provided, however, for purposes of the
limitation on Compensation set forth in Section 401(a)(17) of the Code,
Family Members are limited to spouses and descendants who have not
attained age 19 as of the end of the Plan Year of such Highly
Compensated Employee.
2.32 Fiduciary means the Employer, the Board of Directors, the Pension
Committee or the Trustee, but only with respect to the specific
responsibilities of each with respect to Plan and Trust administration
and only to the extent required by ERISA.
2.33 Forfeiture means that portion of a Participant's HMI Company Regular
Account or Raff-Hughes Company Regular Account that is forfeited in
accordance with Section 6.5 due to incomplete vesting.
2.34 Former Participant means any former Eligible Employee who has credits
in his Account as of the close of any Plan Year.
2.35 Full-Time Employee means an Eligible Employee designated as full-time
under the Employer's employment procedures.
2.36 Highly Compensated Eligible Participant means those Eligible
Participants who are Highly Compensated Employees.
2.37 Highly Compensated Employee means:
(a) Employees who were five percent owners, as defined in Section
416(i)(1)(iii) of the Code, at any time during the
determination year or the look-back year;
(b) Employees with compensation greater than $75,000 (as adjusted
pursuant to Section 415(d)(2) of the Code) during the
look-back year;
(c) Employees with compensation greater than $50,000 (as adjusted
pursuant to Section 415(d)(2) of the Code) during the
look-hack year and who are in the top-paid group for the
look-back year;
(d) Employees who are officers of the Employer or any Affiliate
during the look-back year and who have compensation in the
look-back year greater
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than 50% of the benefit limit in Section 415(b)(1)(A) of the
Code for such year; and
(e) Employees who are both described in paragraph (b), (c), or (d)
above when these paragraphs are modified to substitute the
determination year for the look-back year and who are one of
the 100 Employees who receive the highest compensation from
the Employer during the determination year.
(1) The top-paid group shall consist of the top 20% of
active Employees, ranked on the basis of compensation
received from the Employer during the year including
Employees with less than 6 months of service,
part-time Employees (less than 17 hours per week or
less than 6 months a year). Employees who are not yet
age 21, and nonresident aliens. These Employees shall
not be excluded for purposes of identifying the
particular Employees in the top-paid group. If the
Plan being tested covers only noncollective
bargaining Employees, and collective bargaining
Employees constitute 90 percent or more of the
Employer's Employees, then such collective bargaining
Employees shall be excluded both from the total
number of active Employees and the identification of
particular Employees in the top-paid group. The
top-paid group shall not include Employees who
perform no service during the year.
(2) For purposes of determining whether an Employee is
highly compensated, the determination year is the
Plan Year for which the determination is being made.
The look-back year is the twelve month period
preceding the determination year.
(3) Also, for this purpose, the term "Employee" shall
include Leased Employees unless such Employees are
covered under a safe-harbor plan of the leasing
organization and not covered under a qualified plan
of the Employer.
(4) The number of officers shall be limited to the lesser
of (a) 50, or (b) the greater of 3 individuals or 10
percent of all Employees. If the Employer does not
have at least one officer whose compensation is in
excess of 50% of the limit in Section 415(b)(1)(A) of
the Code, then the highest paid officer of the
Employer shall be treated as a Highly Compensated
Employee.
(5) For purposes of defining Highly Compensated
Employees, Compensation means Compensation as defined
in Section 2.16. The dollar limits are those for the
calendar year in which the
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determination or look-back year begins, as adjusted
for increases in the cost of living pursuant to
Section 415(d)(2) of the Code.
(6) The Plan shall take into account Employees of all
employers aggregated under Sections 414(b), (c), (m)
and (o) of the Code, in determining who is highly
compensated.
(7) Certain former Employees shall be treated as
Employees for the purpose of determining the number
of Highly Compensated Employees. If a former Employee
had a separation prior to the determination year and
was an active Highly Compensated Employee in the year
he separated from service, or in any determination
year after attaining age 55, the former Employee
shall be counted as a Highly Compensated Employee for
the determination year.
(f) Effective for Plan Years beginning on or after January 1,
1994, the Company and all Employers hereby make the calendar
year calculation election described in Treas. Reg.
1.414(q)-1T, Q&A 14(b).
Notwithstanding the foregoing, the Company, by action of the Pension
Committee, may elect for any Plan Year, to define Highly Compensated
Employee by substituting $50,000 (as adjusted pursuant to Section
415(d) of the Code) for $75,000 (as adjusted pursuant to Section 415(d)
of the Code) in Section 414(q)(1)(B) of the Code and by disregarding
Section 414(q)(1)(C) of the Code.
2.38 HMI Company Regular Account means the account maintained for a
Participant to record his share of HMI contributions under Merged Plan
II, if any, and adjustments relating thereto.
2.39 Hours of Service means:
(a) Performance of Duties. The actual hours for which an Eligible
Employee is paid or entitled to be paid by the Employer for
the performance of duties.
(b) Nonworking Paid Time. Each hour for which an Eligible Employee
is paid or entitled to be paid by the Employer on account of a
period of time during which no duties are performed
(irrespective of whether the employment relationship has
terminated) due to vacation, holiday, illness, incapacity,
disability, layoff, jury duty, military duty or leave of
absence; provided, however, no more than 501 Hours of Service
shall be credited to an Eligible Employee on account of any
single continuous period during which he performed no duties;
and provided further that no credit shall be given for
payments made or due under a plan maintained solely for the
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purpose of complying with applicable workers' or unemployment
compensation or disability insurance laws or for payments
which solely reimburse an Eligible Employee for medical or
medically related expenses incurred by the Eligible Employee.
(c) Back Pay. Each hour for which back pay, irrespective of
mitigation of damages, is either awarded or agreed to by the
Employer, provided, however, Hours of Service credited under
paragraphs (a) and (b) above shall not be recredited by
operation of this paragraph.
(d) Equivalencies. To the extent that the Plan requires Hours of
Service to be counted, the Pension Committee shall have the
authority to adopt any of the following equivalency methods,
other than elapsed time, for counting Hours of Service that
are permissible under regulations issued by the Department of
Labor: (1) Working Time, (2) Periods of Employment, or
(3) Earnings.
The adoption of any equivalency method for counting Hours of
Service shall be evidenced by a certified resolution of the
Pension Committee, which shall be attached to and made part of
the Plan. Such resolution shall indicate the date from which
such equivalency shall be effective.
(e) Miscellaneous. Unless the Pension Committee directs otherwise,
the methods of determining Hours of Service when payments are
made for other than the performance of duties and of crediting
such Hours of Service to Plan Years set forth in DOL Reg.
2530.200b-2(b) and (c), shall be used hereunder and are
incorporated by reference into the Plan.
(f) Military Leave. Participants on military leaves of absence who
are not directly or indirectly compensated or entitled to be
compensated by the Employer while on such leave shall be
credited with Hours of Service as required by Section 9 of the
Military Selective Service Act.
(g) No Duplication. Notwithstanding any other provision of this
Plan to the contrary, an Eligible Employee shall not be
credited with Hours of Service more than once with respect to
the same period of time.
2.40 Income means the net gain or loss of the Trust Fund from investments,
as reflected by interest payments, dividends, realized and unrealized
gains and losses on securities, other investment transactions and
expenses paid from the Trust Fund. In determining the Income of the
Trust Fund, assets shall be valued on the basis of their fair market
value except for any investment which the Pension Committee determines
shall be valued on the basis of contract or book value.
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2.41 Investment Funds means the funds designated by the Pension Committee in
accordance with Section 7.2.
2.42 Investment Manager means an investment adviser, bank or insurance
company, meeting the requirements of Section 3(38) of ERISA appointed
by the Employer to manage the Plan's assets in accordance with the
Trust Agreement.
2.43 Leased Employee means any person within the meaning of Section 414(n)
of the Code who is not an Employee of the Employer and who provides
services to the Employer if:
(a) such services are provided pursuant to an agreement between
the Employer and any leasing organization;
(b) such person has performed such services for the Employer (or
for the Employer and Affiliates) on a substantially full-time
basis for a period of at least one year; and
(c) such services are of a type historically performed in the
business field of the Employer by Employees.
Notwithstanding the foregoing, a person shall not be deemed to be a
Leased Employee if he is covered by a plan maintained by the leasing
organization and Leased Employees (as determined without regard to this
paragraph) do not comprise more than 20% of the Employer's nonhighly
compensated workforce. Such plan must be a money purchase pension plan
providing for nonintegrated employer contributions of ten percent of
compensation and also providing for immediate participation and
vesting.
2.44 Limitation Year means the Plan Year.
2.45 Merged Plan means any of the plans defined in Sections 2.47 - 2.52 and
any other plan that is merged into the Plan after October 21, 1992.
2.46 Merged Plan I means the Blue Cross and Blue Shield of Indiana
Employees' Thrift Savings Plan, as in effect prior to January 1, 1991.
2.47 Merged Plan II means the HM1 Employees' Profit Sharing Plan that was in
effect prior to its merger into the TAG Savings Plan on January 1,
1991.
2.48 Merged Plan III means the Key Care Health Resources, Inc. Retirement
Plan that was in effect prior to its merger into the TAG Savings Plan
on January 1, 1991.
2.49 Merged Plan IV means the Robinson-Conner, Inc. 401(k) Plan that was in
effect prior to its merger into the TAG Savings Plan on January 1,
1992.
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2.50 Merged Plan V means the Anthem Group Services Corporation Retirement
Savings Plan that was in effect prior to its merger into the TAG
Savings Plan on January 1, 1992.
2.51 Merged Plan VI means Price and McDonald, Inc. Profit Sharing Plan that
was in effect prior to its merger into the Plan on May 31, 1993.
2.52 Normal Retirement Age means age 65.
2.53 Normal Retirement Date means the date on which a Participant attains
his Normal Retirement Age.
2.54 Participant means any Eligible Employee participating in the Plan in
accordance with the provisions of Section 3.1.
2.55 Participating Employer means any direct or indirect subsidiary of the
Company or any other entity designated by the Board of Directors that
has adopted this Plan with the approval of the Company.
2.56 Part-Time Employee means an Eligible Employee who is designated as a
part-time Employee by the Employer under its employment procedures.
2.57 Pension Committee means the Pension Committee appointed by the Board of
Directors to administer the Plan and to manage and invest the Trust
Fund.
2.58 Period of Service means the aggregate of all periods of a person's
employment as an Eligible Employee with the Employer, whether or not
consecutive.
Service shall include (i) a period of up to 12 months of absence from
employment for any reason other than because of resignation,
retirement, death or discharge; (ii) the period from the date the
Eligible Employee resigns, retires or is discharged to the date of his
reemployment, if he returns to employment with the Employer or any
Affiliate within 12 months of such resignation, retirement or
discharge; and (iii) the period beginning on the date the Eligible
Employee is absent for maternity or paternity reasons and ending on the
date the Eligible Employee commences a Period of Severance due to such
absence.
Service also shall include such period of service in the armed forces
of the United States as shall be required to be recognized under
applicable federal law with respect to military service. Service is
determined as full calendar months.
2.59 Period of Severance means a period of time commencing with an Eligible
Employee's Severance From Service Date and ending with the date such
Eligible Employee resumes employment with the Employer.
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Notwithstanding the foregoing, if an Eligible Employee is absent from
work for maternity or paternity reasons, the Period of Severance shall
not begin until the second anniversary of the first day of the period
in which such absence began. For purposes of this Section, an absence
from work for maternity or paternity reasons meaning an absence (i) by
reason of the pregnancy of the individual; (ii) by reason of a birth of
a child of the individual; (iii) by reason of the placement of a child
with the individual by adoption; or (iv) for purposes of caring for
such child for a period beginning immediately following such birth or
placement.
2.60 Plan means the Acordia Retirement Savings Plan; effective January 1,
1994, the name was changed to the Acordia 401(k) Long Term Savings
Investment Plan.
2.61 Plan Year means the 12 consecutive month period commencing each January
1 and ending December 31. For purposes of discrimination testing, the
first Plan Year will be deemed to be the 12 month period beginning
January 1, 1992.
2.62 Post 1986 After Tax Contribution Account means the separate Account
maintained for a Participant to record: (i) his share of the Trust Fund
attributable to his Post 1986 After Tax Contributions; (ii) his share
of post 1986 after tax contributions that he made to Merged Plan IV;
and (iii) earrings and losses attributable thereto. The Pension
Committee shall separately account, through subaccounts for "Post 1986
Voluntary Contributions." "Post 1986 Voluntary Contributions" shall
mean after-tax contributions made to the Plan which do not qualify for
an Employer Matched Contribution.
2.63 Post 1986 After Tax Contributions means the after-tax contributions
made by a Participant to the Plan under Section 4.2, if any, after
December 31, 1985. Effective April 1, 1993, Participants are prohibited
from making Post 1986 After Tax Contributions. Such contributions prior
to that date shall continue to be held under the Plan.
2.64 Pre 1987 After Tax Contribution Account means the separate Account
maintained for a Participant to record: (i) his share of the Trust Fund
attributable to his Pre 1987 After Tax Contributions; (ii) his share of
pre 1987 after tax contributions that he made under the Raff-Hughes
Plan, which he elected to transfer to this Plan, if any; (flu) his
share of pre 1987 voluntary contributions that he made to Merged Plan
IV; and (iv) earnings and losses attributable thereto. The Pension
Committee shall separately account, through subaccounts, for the
following contributions, and earnings and losses attributable thereto:
(a) "Voluntary Basic Contributions" made to Merged Plan I prior to
January 1, 1984; and
(b) "Voluntary Supplemental Contributions", including
nondeductible voluntary contributions made to Merged Plan II
or that were transferred to the Plan.
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For purposes of this Plan, (i) "Voluntary Basic Contributions" shall
mean after-tax contributions made to the Plan which qualified for an
Employer matched contribution, and (ii) "Voluntary Supplemental
Contributions" shall mean after-tax contributions made to the Plan
which did not qualify for an Employer matched contribution.
2.65 Pre 1987 After Tax Contributions means the after tax contributions made
by a Participant to the Plan before January 1, 1987.
2.66 QNEC(s) means the discretionary qualified nonelective contributions
made by the Employer on a Participant's behalf pursuant to Section
4.1(c).
2.67 QNEC Account means the account maintained for a Participant to record
his share of QNECs under Section 4.1(c) and adjustments relating
thereto.
2.68 Raff-Hughes Company Regular Account means the Account maintained for a
Participant to record his share of Raff-Hughes contributions made on
his behalf under the TAG Savings Plan in plan years beginning on or
after January 1, 1992.
2.69 Raff-Hughes Plan means the Raffensperger, Hughes & Co., Inc. Employees'
Profit Sharing Plan.
2.70 Retirement means termination of employment from the Employer at or
after Normal Retirement Date.
2.71 Rollover Account means the account maintained on behalf of a
Participant to record the amounts (i) he has rolled over to the Plan
pursuant to Section 4.11; (ii) amounts that he rolled over to Merged
Plan III, V, or VI, if any; (iii) any amounts (including outstanding
plan loans) transferred on a trustee to trustee basis from The
Associated Group 401(k) Long Term Savings Investment Plan; and (iv)
adjustments relating thereto.
2.72 Severance From Service Date means the earlier of (i) the date on which
an Employee quits, dies, retires or is discharged or (ii) the first
anniversary of the first date of a period in which an Employee remains
absent from service with or without pay with the Employer for any
reason other than the foregoing.
2.73 Shelby Pension Transfer Account means the account maintained for a
Participant who participated in the Shelby Insurance Group Retirement
Savings Plan to record his share of pension transfer dollars held for
his benefit under that plan, if any, and adjustments related thereto.
2.74 Spouse (surviving spouse) means the spouse or surviving spouse of the
Participant or Former Participant; provided that a former spouse will
be treated as the spouse
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or surviving spouse to the extent provided under a qualified domestic
relations order as described in Section 414(p) of the Code.
2.75 Temporary Employee means an Employee who is neither a Part-Time or
Full-Time Employee.
2.76 Terminated or Termination means a termination of employment with the
Employer or with an Affiliate for any reason other than a transfer of
employment from the Employer to an Affiliate or from an Affiliate to
another Affiliate.
2.77 Trust (or Trust Fund) means the fund created by the Trust Agreement and
maintained by the Trustee in accordance with the terms of the Trust
Agreement.
2.78 Trust Agreement means "The Master Trust Agreement between Acordia, Inc.
and the Bank of New York," as amended from time to time and that
constitutes part of the Plan.
2.79 Trustee means the individual or entity designated in the Trust
Agreement, or any successor Trustee or Trustees appointed to administer
the Trust.
2.80 Valuation Date means the last day of each calendar month and such other
dates selected by the Pension Committee, on which dates Trust gains and
losses are allocated to Participants' Accounts pursuant to Section 5.2.
Effective January 1, 1994, each day on which the security markets of
the United States are generally in operation shall be a Valuation Date
or such other dates selected by the Pension Committee.
Construction. The masculine gender, where appearing in the Plan, shall be deemed
to include the feminine gender, unless the context clearly indicates to the
contrary.
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ARTICLE III
PARTICIPATION AND SERVICE
3.1 Continuing Participation. Each Eligible Employee who was a Participant
in the TAG Savings Plan on the day before the Effective Date shall
continue as a Participant if employed by an Employer on the Effective
Date. Each other Full-Time, Part-Time or Temporary Eligible Employee
shall be eligible to participate as provided in Section 3.2.
3.2 Eligibility to Participate.
(a) Effective for Eligible Employees first credited with an Hour
of Service prior to April 1, 1993:
(i) Full-Time Employees and Part-Time Employees shall be
eligible to participate as soon as administratively
feasible after completing three (3) months of
service.
(ii) Temporary Employees shall be eligible to participate
as soon as administratively feasible after they are
credited with 1,000 Hours of Service in a 12 month
period.
(b) An Eligible Employee first credited with an Hour of Service on
or after April 1, 1993, shall be eligible to participate on
his Employment Commencement Date.
(c) Temporary Employees hired on or after January 1, 1994 and
those Employees who become Temporary Employees on or after
January 1, 1994, may not participate or continue to actively
participate in the Plan.
3.3 Change in Active Status. A Participant shall cease to be an active
Participant and shall no longer be permitted to contribute to the Plan
when he is no longer an Eligible Employee.
3.4 Special Rules for Participation and Vesting Purposes. For purposes of
determining an Eligible Employee's eligibility to participate and
Periods of Service for vesting pursuant to Section 6.4, Hours of
Service, months of employment and Period of Service shall include an
Eligible Employee's Hours of Service and months of employment or
Periods of Service (i) as a Leased Employee of the Employer or an
Affiliate (after the employer became an Affiliate); (ii) as an Employee
of the Employer or an Affiliate (after the employer became an
Affiliate) covered by the terms of a collective bargaining agreement
that does not provide for participation in this Plan; (iii) while a
common law Employee of the Employer who is not deemed to be an Eligible
Employee or while a common law Employee of an Affiliate; or (iv) while
an Employee of a predecessor organization of the Employer
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in any case where the Employer maintains the plan of such predecessor
organization as required under Section 414(a) of the Code.
3.5 Participation and Service upon Reemployment. Upon the reemployment of
any person after the Effective Date who had previously been employed by
the Employer, the following rules shall apply in determining his
participation in the Plan. If the reemployed Eligible Employee was not
a Participant in the Plan during his prior period of employment, he
must meet the requirements of Section 3.2 for participation in the
Plan. If the reemployed Eligible Employee was a Participant in the Plan
during his prior period of employment, he shall again become a
Participant in the Plan as soon as administratively feasible upon his
rehire. For purposes of this Section 3.5, any Periods of Service
credited to a Participant, Eligible Employee or Employee prior to his
termination of employment shall be restored upon his reemployment for
purposes of vesting in Employer contributions allocated to his Account
following his reemployment. Section 6.5 sets forth the rules pertaining
to vesting following reemployment in amounts allocated to a
Participant's Account prior to his Termination of employment.
3.6 Cessation of Participation. A Participant shall cease to a Participant
on the date as of which (i) he is no longer an Eligible Employee and
(ii) all of his vested Accounts have been distributed.
3.7 Transfers From Affiliates and Change in Status. Any Eligible Employee
who transfers to the Employer from an Affiliate or who otherwise
becomes an Eligible Employee after his Employment Commencement Date,
shall be eligible to participate in the Plan as of the date of transfer
or change in status.
3.8 Transfers To and From The Associated Group.
(a) A Participant who is transferred (as defined in subsection (c)
below) to Associated Insurance Companies, Inc. or one of its
affiliates participating in The Associated Group Long Term
Savings Investment Plan (a TAG Employer) may elect in
accordance with procedures adopted by the Pension Committee to
have his accounts (including any outstanding plan loans) and
the assets associated with those accounts transferred to The
Associated Group 401(k) Long Term Savings Investment Plan as
soon as administratively feasible after the transfer.
(b) An employee of a TAG Employer who is transferred (as defined
in subsection (c) below) to an Employer and becomes a
Participant may have his accounts (including any outstanding
plan loans) and the assets associated with those accounts
transferred to the Plan as soon as administratively feasible
after the transfer.
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(c) A Participant shall be deemed to have transferred
(i) from an Employer to a TAG Employer if, within the 60
day period following the Participant's Termination
with an Employer, he is hired by a TAG Employer and
becomes an eligible employee under the TAG Savings
Plan; or
(ii) from a TAG Employer to an Employer if, within the 60
day period following the termination of employment as
an eligible employee with a TAG Employer, he is hired
by an Employer participating in the Plan and becomes
an Eligible Employee.
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ARTICLE IV
CONTRIBUTIONS
4.1 Employer Contributions.
(a) (i) Before Tax Matched Contributions. Subject to the
limitations of Sections 4.6, 4.10 and 5.3, each Participant
shall have the option to authorize the Employer in accordance
with procedures established by the Pension Committee, to
contribute to the Plan for a Plan Year on his behalf, an
amount equal to any whole percentage of his Compensation from
one percent (1%) up to six percent (6%) (as determined without
regard to this Section 4.1(a)) for such Plan Year. Such
authorization shall be in the form of an election by the
Participant to have his Compensation reduced by payroll
withholding. The election of a new Participant shall be
effective as soon as administratively feasible following
receipt of the election by the Pension Committee. Such
withheld amounts are to be transmitted by the Employer to the
Trustee as of the earliest date on which such amounts can
reasonably be segregated from the Employer's general assets,
but in no event later than 90 days after such amounts are
withheld from the Participant's Compensation.
(ii) Before Tax Supplemental Contributions. Subject to the
limitations of Sections 4.6, 4.10 and 5.3, each Participant
shall have the option to authorize the Employer in accordance
with procedures established by the Pension Committee, to
contribute to the Plan for a Plan Year on his behalf, an
amount equal to any whole percentage of his Compensation from
seven percent (7%) up to sixteen percent (16%) (as determined
without regard to this Section 4.1(a)) for such Plan Year.
Such authorization shall be in the form of an election by the
Participant to have his Compensation reduced by payroll
withholding. The election of a new Participant shall be
effective as soon as administratively feasible following
receipt of the election by the Pension Committee. Such
withheld amounts are to be transmitted by the Employer to the
Trustee as of the earliest date on which such amounts can
reasonably be segregated from the Employer's general assets,
but in no event later than 90 days after such amounts are
withheld from the Participant's Compensation.
(iii) Excess Deferrals. Notwithstanding the foregoing, the
Participant shall be prohibited from authorizing any Before
Tax Contributions to be made on his behalf under this Plan and
elective contributions under any other plan, in excess of the
applicable limit under Section 402(g) of the Code in effect
for the Plan Year to which such Before Tax Contributions
relate. In the event a Participant has made excess deferrals,
then not later
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than the first day of March following the close of the
Participant's taxable year, the Participant may notify each
plan under which deferrals were made of the amount of the
excess deferrals received by that plan. The Participant shall
be deemed to have notified the Plan of excess deferrals to the
extent he has excess deferrals for the taxable year calculated
by taking into account only elective deferrals under the Plan
and other plans of the Employer or Affiliate. The Employer may
notify the Plan on behalf of the Participant under these
circumstances.
Not later than the first April 15 following the close of the
taxable year, the Plan shall distribute to the Participant the
amount designated above, including any Income allocated
thereto. The Income attributable to a Participant's excess
deferral pursuant to this Section 4.1(a)(iii) for the Plan
Year during which such excess deferral arose shall be
determined in accordance with Treas. Reg.
1.402(g)-1(e)(5)(ii). Unless otherwise provided for by the
Pension Committee, any Income attributable to a Participant's
excess deferrals for the period between the end of the Plan
Year and the date of distribution shall be disregarded.
A Participant who has excess deferrals for a taxable year may
receive a corrective distribution of excess deferrals during
the same year. This corrective distribution shall be made only
if:
(A) The Participant designates the distribution as an excess
deferral. The Participant shall be deemed to have designated
the distribution to the extent the Participant has excess
deferrals for the taxable year calculated by taking into
account only elective deferrals under the Plan and other plans
of the Employer and Affiliate. The Employer may make the
designation on behalf of the individual under these
circumstances.
(B) The correcting distribution is made after the date on
which the Plan received the excess deferral.
(C) The Plan designates the distribution as a distribution of
excess deferrals.
The term "excess deferrals" means the excess of an
individual's elective deferrals for any taxable year, as
defined in Treas. Reg. 1.402(g)-1(b), over the applicable
limit under Section 402(g)(1) of the Code for the taxable
year.
(iv) Compliance. The Pension Committee may further limit a
Participant's right to make Before Tax Contributions to the
Plan if in the sole judgment and discretion of the Pension
Committee, such limits are
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necessary to ensure the Plan's compliance with the
requirements of Sections 401(k) and (m) of the Code.
(b) Employer Matched Contributions. Subject to the limitations
of Sections 4.8 and 5.3 and except for those Participating
Employers listed on Appendix A, an Employer shall contribute
with respect to each pay period an amount equal to 50% of a
Participant's Before Tax Matched Contributions that a
Participant has authorized the Employer to make on his
behalf for the Plan Year. In the event a Participant who is
not a Highly Compensated Employee for the Plan Year and who
is not participating in one of the nonqualified deferred
compensation plans sponsored by the Company elected to make
Before Tax Matched Contributions in such amount that the
limitations under Section 402(g) of the Code restricted the
Participant's Before Tax Contributions, that Participant
shall receive an Employer Matched Contribution as if the
full amount of the Before Tax Contributions of the
Participant had been made. The amount of such contribution
shall not exceed the maximum amount allowable as a deduction
under the Code for such Plan Year.
(c) QNECS. Subject to the limitations of Sections 4.3 and 5.3,
the Employer shall contribute for each Plan Year an amount,
if any, as determined by the Board of Directors on behalf of
some or all Participants who are not Highly Compensated
Eligible Participants. The amount of such contribution shall
not exceed the maximum amount allowable as a deduction under
the Code for such Plan Year. It is intended that this
contribution shall constitute a qualified nonelective
contribution within the meaning of Treas. Reg.
1.401(k)-1(g)(13)(ii) or any successor thereto.
4.2 Post 1986 After Tax Contributions. Subject to the limitations of
Sections 4.8, 4.10 and 5.3, each Participant shall have the option to
contribute to the Plan for a Plan Year an amount equal to any
percentage of his Compensation up to ten percent (10%) for such Plan
Year. Such authorization shall be in the form of an election by the
Participant to have his Compensation reduced on an after-tax basis by
payroll deduction in accordance with procedures established by the
Pension Committee. Such amounts are to be transmitted by the Employer
to the Trustee as of the earliest date on which such amounts can be
reasonably segregated from the Employer's general assets, but in no
event later than 90 days after such amounts have been withheld from
Participants' Compensation.
Effective April 1, 1993, Participants shall not have the option to
contribute to the Plan on an after-tax basis. Pre-April 1, 1993,
after-tax contributions shall continue to be held by the Plan in
accordance with the provisions of the Plan.
4.3 Time and Manner of Contribution. All Employer contributions shall be
paid directly to the Trustee. Except as provided in Section 4.1(a), a
contribution for
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any Plan Year shall be made not later than the date prescribed by law
for filing the Employer's Federal income tax return, including
extensions, for such Plan Year.
4.4 Conditions on Employer Contributions. To the extent permitted or
required by ERISA and the Code, contributions under this Plan are
subject to the following conditions:
(a) If the Employer makes a contribution, or any part thereof,
by mistake of fact, such contribution or part thereof shall
be returned to the Employer within one year after such
contribution is made.
(b) Contributions to the Trust Fund are specifically conditioned
on the initial qualification of the Plan under the Code; in
the event the Plan is determined to be disqualified upon an
application for determination made by the time prescribed by
law for filing the Employer's return for the taxable year in
which the Plan was adopted or such later date as the
Secretary of the Treasury may prescribe, contributions made
with respect to any period subsequent to the effective date
of such disqualification shall be refunded to the Employer
within one year after the effective date of
disqualification.
(c) Contributions to the Plan are specifically conditioned upon
their deductibility under the Code. To the extent a
deduction is disallowed for any such contribution, such
amount shall be refunded to the Employer within one year
after the disallowance of the deduction.
(d) Earnings attributable to the contribution shall not be
refunded to the Employer, but losses shall reduce the amount
to be refunded. In no event shall return of the contribution
to the Employer reduce the amount of any Participant's
Account to less than the balance that would have been in
such Account had the contribution not been made.
(e) The amount of any Employer contribution shall be subject to
the limitations prescribed in Section 5.3.
4.5 Change in Amount of Before Tax or Post 1986 After Tax Contributions.
Upon notice to the Pension Committee, each Participant shall have the
option to change the amount of Before Tax Contributions he has
authorized the Employer to contribute to the Plan on his behalf
pursuant to Section 4.1(a) or Post 1986 After Tax Contributions under
Section 4.2 (for periods prior to April 1, 1993), effective as soon as
administratively feasible following receipt of the change by the
Pension Committee. Upon notice to the Pension Committee, each
Participant shall have the option to suspend completely the amount of
Before Tax Contributions he has authorized the Employer to contribute
to the Plan on his behalf pursuant to Section
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4.1(a) or Post 1986 After Tax Contributions under Section 4.2,
effective as soon as administratively feasible after receipt of the
notice by the Pension Committee. A Participant who has ceased making
Before Tax Contributions or Post 1986 After Tax Contributions may again
authorize Before Tax Contributions to be made to the Plan on his behalf
or Post 1986 After Tax Contributions effective as soon as
administratively feasible following receipt of the form by the Pension
Committee and after a suspension period of six months. Notwithstanding
the foregoing, effective January 1, 1994, the six month suspension
period is eliminated, and a Participant may change the amount of his
Before Tax Contributions at any time by giving notice to the Pension
Committee, but not more than four changes shall be permitted in any
Plan Year. The change shall become effective as soon as
administratively feasible following receipt of notice by the Pension
Committee.
A Participant also may elect to change his Before Tax Contributions'
rate and may elect to commence or increase his Post 1986 After Tax
Contributions as a result of any limitations imposed by Section
4.1(a)(iii) on the amount of Before Tax Contributions that a
Participant may authorize the Employer to contribute on his behalf.
4.6 Limitations on Before Tax Contributions. The amount of Before Tax
Contributions made in each Plan Year on behalf of all Participants
under the Plan shall comply with either (i) or (ii) and (iii), if
applicable, below.
(i) The Average Deferral Percentage for the Highly Compensated
Eligible Participants shall not exceed the Average Deferral
Percentage for all other Eligible Participants multiplied by
125%, or
(ii) The Average Deferral Percentage for Highly Compensated Eligible
Participants shall not be greater than the Average Deferral
Percentage of all other Eligible Participants multiplied by 200%
and the excess of the Average Deferral Percentage for Highly
Compensated Eligible Participants over the Average Deferral
Percentage for all other Eligible Participants shall not
exceed two percentage points.
Compliance with (i) and (ii) above, shall be determined in
accordance with the rules set forth in Section 401(k)(3) of the
Code, Treas. Reg. 1.401(k)-l(b), or any successors thereto.
(iii) Notwithstanding the foregoing, if this Section 4.6 and Section
4.8 are both satisfied by use of the limitation set forth in
Section 4.6(ii) and Section 4.8(ii), respectively, the Average
Deferral Percentages for the Highly Compensated Eligible
Participants and the Average Contribution Percentages for the
Highly Compensated Eligible Participants, as defined in Section
4.8, also must satisfy the aggregate limit test set forth in
Treas. Reg. 1.401(m)-2(b)(3).
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If the Pension Committee determines, in its sole discretion,
with respect to any Plan Year, that the Plan will (or may) fail
(i) or (ii) and (iii) above, the Pension Committee shall take
any action, that it deems appropriate, including imposing
limitations on Before Tax Contributions made by Highly
Compensated Eligible Participants, for the Plan to satisfy (i)
or (ii) and (iii) above.
Effective January 1, 1994, the Pension Committee, at the beginning of
the Plan Year, shall impose a limitation (the "Initial Limitation") on
the Before Tax Contributions made by Highly Compensated Eligible
Participants as deemed necessary and appropriate by the Pension
Committee to ensure that the Plan satisfies either (i) or (ii) and
(iii) above. The Pension Committee shall monitor the Plan on a monthly
basis to determine whether, in the Pension Committee's judgment, the
Plan will satisfy either (i) or (ii) and (iii) above. If, as of any
month, the Pension Committee, in its sole discretion, determines that
the Plan will not satisfy either (i) or (ii) and (iii) above without
further adjustments, the Pension Committee will reduce, by one or more
whole or fractional percentage points, the rate of Before Tax
Contributions of those Highly Compensated Eligible Participants who
have not yet reached the Initial Limitation. The Pension Committee
shall only reduce contribution rates by the number of whole or
fractional percentage points that the Pension Committee, in its
judgment, deems necessary to make the Average Contribution Percentages
and Average Deferral Percentages of Highly Compensated Eligible
Participants satisfy the requirements of either (i) or (ii) and (iii)
above.
If the amount of Before Tax Contributions authorized by Highly
Compensated Eligible Participants in a Plan Year would not comply with
either (i) or (ii) and (iii) above, then by the last day of the
following Plan Year, the Pension Committee may determine that the
Excess Contributions for such Plan Year (including any Income
attributable to such contributions) shall be distributed to Highly
Compensated Eligible Participants on the basis of the respective
portions of such Excess Contributions attributable to each such Highly
Compensated Eligible Participant in accordance with Treas. Reg.
1.40l(k)-l(f)(4).
If Excess Contributions are distributed to Highly Compensated Eligible
Participants, the amount of excess of each Highly Compensated Eligible
Participant is the amount by which his Before Tax Contributions must be
reduced for the Participant's deferral percentage to equal the highest
permitted Actual Deferral Percentage under the Plan. To calculate the
highest permitted Actual Deferral Percentage under the Plan, the Actual
Deferral Percentage of the Highly Compensated Eligible Participant with
the highest deferral percentage is reduced by the amount required to
cause the Participant's Actual Deferral Percentage to equal the
percentage of the Highly Compensated Eligible Participant with the next
highest Actual Deferral Percentage. If a lesser reduction would enable
the arrangement to satisfy the Actual Deferral Percentage test, only
such lesser
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reduction need be made. This process shall be repeated until the
requirements set forth above are met. The highest deferral percentage
remaining under the Plan after leveling is the highest permitted Actual
Deferral Percentage. In no event shall the amount of Excess
Contributions to be distributed for a Plan Year with respect to any
Highly Compensated Eligible Participant exceed the amount of Before Tax
Contributions made on behalf of the Highly Compensated Eligible
Participant for the Plan Year.
The Compensation and Before Tax Contributions of Highly Compensated
Eligible Participants who are either 5 percent owners or among the ten
most Highly Compensated Eligible Participants includes the Compensation
and Before Tax Contributions of their Family Members. When family
aggregation shall be required, the family group shall be treated as one
Highly Compensated Eligible Participant and the Actual Deferral
Percentage for the group shall be determined by combining the Before
Tax Contributions, amounts treated as Before Tax Contributions and
Compensation of all the eligible Family Members. If an Employee is
required to be aggregated as a Family Member of more than one family
group in the Plan, then all Participants who are Family Members of
those family groups that include that Employee, are aggregated as one
family group.
The amount of Excess Contributions for a Highly Compensated Eligible
Participant shall be determined by reducing the contribution percentage
of the Highly Compensated Eligible Participants who have the highest
percentages to the maximum acceptable level. The amount of Excess
Contributions to be reduced shall be reduced by excess deferrals, as
defined in Section 4.1(a)(ii), previously distributed for the taxable
year ending in the same Plan Year.
If the Highly Compensated Eligible Participant's deferral percentage
was required to be determined by combining the Compensation and Before
Tax Contributions of all Family Members who are Participants, the
Highly Compensated Eligible Participant's percentage shall be reduced
as set forth above. Excess Contributions shall be allocated among the
eligible Family Members in proportion to the Before Tax Contributions
of each such Family Member that were combined above.
Notwithstanding the foregoing, the Employer may make a QNEC on behalf
of some or all Eligible Participants who are not Highly Compensated
Eligible Participants in order to comply with (i) or (ii) and (iii) for
any Plan Year.
4.7 Income Attributable to Excess Contributions. The Income attributable to
a Participant's Excess Contributions pursuant to Section 4.6 for the
Plan Year during which such Excess Contributions arose shall be
determined in accordance with Treas. Reg. 1.401(k)-l(fl(4)(ii).
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Unless otherwise provided for by the Pension Committee, any gain or
loss on a Participant's Excess Contributions for the period between the
end of the Plan Year and the date of distribution shall be disregarded.
4.8 Limitations on Employer Matched and Post 1986 After Tax Contributions.
The amount of Employer Matched Contributions made in each Plan Year on
behalf of all Participants under the Plan and Post 1986 After Tax
Contributions made by Participants shall comply with either (i) or (ii)
and (iii), if applicable, below.
(i) The Average Contribution Percentage for the Highly Compensated
Eligible Participants shall not exceed the Average Contribution
Percentage for all other Eligible Participants multiplied by
125%, or
(ii) The Average Contribution Percentage for Highly Compensated
Eligible Participants shall not be greater than the Average
Contribution Percentage of all other Eligible Participants
multiplied by 200% and the excess of the Average Contribution
Percentage for Highly Compensated Eligible Participants over the
Average Compensation Percentage for all other Eligible
Participants shall not exceed two percentage points.
Compliance with (i) and (ii) above, shall be determined in
accordance with the rules set forth in Section 401(m)(2) of the
Code and Treas. Reg. 1.401(m)-1(b), or any successors thereto.
(iii) Notwithstanding the foregoing, if Section 4.8 and Section 4.6
are both satisfied by use of the limitation set forth in Section
4.8(ii) and Section 4.6(ii), respectively, above, the Average
Contribution Percentages for the Highly Compensated Eligible
Participants and the Average Deferral Percentages for the Highly
Compensated Eligible Participants, as defined in Section 4.6,
also must satisfy the aggregate limit test set forth in Treas.
Reg. 1.401(m)-2(b)(3).
If the Pension Committee determines, in its sole discretion,
with respect to any Plan Year, that the Plan will (or may) fail
(i) or (ii) and (iii) above, the Pension Committee shall take
any action that it deems appropriate, for the Plan to satisfy
(i) or (ii) and (iii) above.
If the amount of Employer Matched Contributions made on behalf
of Highly Compensated Eligible Participants and Post 1986 After
Tax Contributions made by Highly Compensated Eligible
Participants in a Plan Year would not comply with either (i) or
(ii) and (iii) above, then by the last day of the following Plan
Year, the Pension Committee may determine that the Excess
Aggregate Contributions for such Plan Year (including any Income
attributable to such contributions) shall be distributed to
Highly Compensated Eligible Participants or Employer Matched
Contributions may
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be forfeited on the basis of the respective portions of such
Excess Aggregate Contributions attributable to each such Highly
Compensated Eligible Participant in accordance with Treas. Reg.
1.401(m)-l(e).
If Excess Aggregate Contributions are distributed or forfeited
for Highly Compensated Eligible Participants, the amount of
excess of each Highly Compensated Eligible Participant is the
amount by which his Matching Contributions must be reduced for
the Participant's contribution percentage to equal the highest
permitted Actual Contribution Percentage under the Plan.
To calculate the highest permitted Actual Contribution
Percentage under the Plan, the Actual Contribution Percentage of
the Highly Compensated Eligible Participant with the highest
contribution percentage is reduced by the amount required to
cause the Participant's Actual Contribution Percentage to equal
the percentage of the Highly Compensated Eligible Participant
with the next highest Actual Contribution Percentage. If a
lesser reduction would enable the arrangement to satisfy the
Actual Contribution Percentage test, only such lesser reduction
need be made. This process shall be repeated until the
requirements set forth above are met. The highest contribution
percentage remaining under the Plan after leveling is the
highest permitted Actual Contribution Percentage. In no event
shall the amount of Excess Aggregate Contributions to be
distributed or forfeited for a Plan Year with respect to any
Highly Compensated Eligible Participant exceed the amount of
Matching Contributions made on behalf of the Highly Compensated
Eligible Participant for the Plan Year.
The Compensation and Matching Contributions of Highly
Compensated Eligible Participants who are either 5 percent
owners or among the ten most Highly Compensated Eligible
Participants includes the Compensation and Matching
Contributions of their Family Members. When family aggregation
shall be required, the family group shall be treated as one
Highly Compensated Eligible Participant and the Actual
Contribution Percentage for the group shall be determined by
combining the Matching Contributions, amounts treated as
Matching Contributions and Compensation of all the eligible
Family Members. If an Employee is required to be aggregated as a
Family Member of more than one family group in the Plan, then
all Participants who are Family Members of those family groups
that include that Employee, are aggregated as one family group.
The amount of Excess Aggregate Contributions for a Highly
Compensated Eligible Participant shall be determined by reducing
the contribution percentage of the Highly Compensated Eligible
Participants who have the highest percentages to the maximum
acceptable level.
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If the Highly Compensated Eligible Participant's contribution
percentage was required to be determined by combining the
Compensation and Matching Contributions of all Family Members
who are Participants, the Highly Compensated Eligible
Participant's percentage shall be reduced as set forth above.
Excess Aggregate Contributions shall be allocated among the
eligible Family Members in proportion to the Matching
Contributions of each such Family Member that were combined
above.
Notwithstanding the foregoing, the Employer may make a QNEC on
behalf of some or all Eligible Participants who are not Highly
Compensated Eligible Participants in order to comply with (i) or
(ii) and (iii) for any Plan Year.
4.9 Income Attributable to Excess Aggregate Contributions. The Income
attributable to a Participant's Excess Aggregate Contributions pursuant
to Section 4.8 for the Plan Year during which such Excess Aggregate
Contributions arose shall be determined in accordance with Treas. Reg.
1.401(m)-1(e)(3)(ii).
Unless otherwise provided for by the Pension Committee, any gain or
loss on a Participant's Excess Aggregate Contributions for the period
between the end of the Plan Year and the date of distribution shall be
disregarded.
4.10 Combined Limitation. In no event shall the combined amount of Before
Tax Contributions and Post 1986 After Tax Contributions made by or on
behalf of any Participant for any payroll period exceed sixteen percent
(16%) of such Participant's Compensation for such payroll period. To
the extent that the foregoing limitation would be exceeded, a
Participant's Post 1986 After Tax Contributions shall be reduced first
prior to reducing his Before Tax Contributions.
4.11 Rollovers. An Eligible Employee may transfer to the Trust any cash
which has been distributed to him whether such amount is (i)
transferred by the Eligible Employee after his receipt of such amount
from a plan qualified under Section 401(a) of the Code or (ii)
transferred from a "conduit" individual retirement account established
by the Eligible Employee upon his receipt of such amount from a plan
qualified under Section 401(a) of the Code; provided, however, that
such amount qualifies as a rollover amount as defined by the Code at
the time of the transfer and the Participant complies with such rules
and other criteria as the Pension Committee may establish from time to
time to insure the qualified status of the Plan. The amount of cash
transferred to the Trust pursuant to this Section 4.11 shall be
credited to the Eligible Employee's Rollover Account in accordance with
Section 5.1. A Participant shall be fully vested in his Rollover
Account at all times. In the event any amount rolled over into the Plan
is found not eligible for rollover, such amount, as adjusted for
earnings and losses, shall be distributed to the Participant as soon as
administratively feasible.
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4.12 Requirements for Qualified Non-Elective Contributions and Qualified
Matching Contributions. Any contributions that are designated as
qualified non-elective contributions (QNEC) or as qualified matching
contributions shall meet the requirements of Treas. Reg.
1.401(k)-1(b)(5) and 1.401(m)-1(b)(5). In addition, qualified
non-elective contributions and qualified matching contributions shall
be fully vested at all times. Such contributions shall be distributed
from the Plan only in accordance with the events enumerated in the
Plan, provided, however, that in no event shall such amounts be
available for hardship withdrawal.
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ARTICLE V
ALLOCATIONS TO PARTICIPANTS' ACCOUNTS
5.1 Individual Accounts. On and after the Effective Date, the Pension
Committee shall direct the recordkeeper for the Plan to maintain the
following separate accounts in the name of each Participant:
(a) Before Tax Matched Account.
(b) Before Tax Supplemental Account.
(c) Company Account.
(d) Employer Matched Account.
(e) HMI Company Regular Account.
(f) Post 1986 After Tax Contribution Account.
(g) Pre 1987 After Tax Contribution Account.
(h) QNEC Account.
(i) Raff-Hughes Company Regular Account.
(j) Rollover Account.
(k) Shelby Pension Transfer Account.
5.2 Account Adjustments (Effective for Valuation Dates Occurring Prior to
January 1. 1994). The Accounts of Participants, Former Participants and
Beneficiaries shall be adjusted as of each Valuation Date in accordance
with the following:
(a) Income. The Income of each investment fund shall be allocated
as of each Valuation Date to the accounts of Participants,
Former Participants and Beneficiaries who have unpaid balances
in their accounts invested in each particular fund on the
Valuation Date, in proportion to the balances in such accounts
immediately after the preceding Valuation Date, but after
first reducing each such account by any distributions,
withdrawals or loans from such account during the interim
period. Income for any month to be allocated since the
preceding Valuation Date, shad be allocated prior to posting
any contributions to Participants' Accounts for that month.
Notwithstanding the foregoing, in the case of any QNEC's that are made
after the close of a Plan Year but which are credited pursuant to
Section 5.3 as of the last
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day of the Plan Year, Income with respect to such contributions shall
begin to be allocated as of the Valuation Date after such contributions
are made.
If during any month of the Plan Year a Participant, Former Participant
or Beneficiary becomes entitled to a distribution from an account, the
Committee shall instruct the Trustee or recordkeeper, as appropriate,
to determine the Income as of the immediately preceding Valuation Date.
The Account or Accounts of any Participant, Former Participant or
Beneficiary to be distributed as of that Valuation Date shall not be
adjusted proportionately to reflect any Income accrued after such
Valuation Date.
(b) Crediting of Employer Contributions.
(i) The Employer's Before Tax Contributions for the Plan Year
made pursuant to Section 4.1(a) shall be forwarded to the
Trustee and credited directly to the Before Tax Matched
or Before Tax Supplemental Account of each Participant
who authorized Before Tax Contributions as soon as such
amounts can be segregated from the general assets of the
Employer. Before Tax Contributions shall be credited as
of the last day of the month in which occurs the pay date
to which such Before Tax Contributions relate.
(ii) The Employer's Employer Matched Contributions for the
Plan Year made pursuant to Section 4.1(b) shall be
credited to the Employer Matched Account of each
Participant who authorized a Pre Tax Contribution to be
made on his behalf in accordance with Section 4.1(b), as
of the last day of the month in which occurs the pay date
to which such contributions relate.
(iii) The Employer's QNEC for the Plan Year, made pursuant to
Section 4.1(c), shall be credited as of each Plan Year
directly to the QNEC Accounts of Eligible Participants
who are not Highly Compensated Eligible Participants and
who are designated to receive such a contribution as of
the last day of the Plan Year.
(c) Post 1986 After Tax Contributions. Participants' Post 1986 After
Tax Contributions made pursuant to Section 4.2, shall be
forwarded to the Trustee and credited directly to the Post 1986
After Tax Contribution Account of each Participant who has made
Post 1986 After Tax Contributions as soon as such amounts can be
reasonably segregated from the general assets of the Employer.
Post 1986 After Tax Contributions shall be credited as of the
last day of the month in which occurs the pay date to which they
relate.
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(d) Deemed Date of Allocation. All credits or deductions made under
this Article to Participants' accounts shall be deemed to have
been made no later than the last day of the Plan Year though
actually determined thereafter.
5.3 Account Adjustments (Effective for Valuation Dates on or After January
1, 1994). The Accounts of Participants, Former Participants and
Beneficiaries shall be adjusted by valuing all assets of the Trust
following the end of each business day of the Plan Year in the
following manner.
(a) Adjustments.
(i) The Pension Committee shall first compute the net asset
value of securities and/or other assets comprising each
investment fund, designated by the Pension Committee for
direction of investment by Participants, Former
Participants and Beneficiaries. This net asset value
shall be equal to the market price of the investment fund
on the prior business day applied to the net asset value
as of the close of business on the current business day.
(ii) The recordkeeper, at the direction of the Pension
Committee, shall, following the computation of the net
asset value, assign a gain or loss to each Participant's
Account.
(iii) The Trustee shall then account for any requests for
additions or withdrawals made to or from a specific
designated investment fund by any Participant and
received by the Trustee prior to the stated deadline on
such business day.
In completing the valuation procedure described above,
such adjustments in the amounts credited to such Accounts
shall be made on the business day to which the investment
activity relates. No admissions to Investment Funds made
pursuant to the Plan shall be taken into account until
the date such contribution was both actually paid to the
Trustee and credited to the Participant's Accounts. It is
intended that this Section operate to distribute among
the Participant's Accounts all income of the Trust Fund
and changes in the value of the Trust Fund's assets.
(iv) In addition to the above paragraph (iii), in the event a
pooled investment fund is created as a designated fund
for Participant investment election in the Plan,
valuation of the pooled investment fund shall be governed
by the administrative services agreement for such pooled
investment fund.
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(b) Crediting of Employer Contributions.
(i) The Employer's Before Tax Contributions for the Plan Year
made pursuant to Section 4.1(a) shall be forwarded to the
Trustee and credited directly to the Before Tax Account
of each Participant who authorized Before Tax
Contributions as soon as such amounts can be segregated
from the general assets of the Employer.
(ii) The Employer's Employer Matched Contributions for the
Plan Year made pursuant to Section 4.1(b) shall be
credited as soon as administratively feasible to the
Employer Matched Account of each Participant who
authorized a Before Tax Contribution to be made on his
behalf in accordance with Section 4.1(b).
(iii) The Employer's QNEC for the Plan Year, made pursuant to
Section 4.1(c), shall be credited as of each Plan Year
directly to the QNEC Accounts of Eligible Participants
who are not Highly Compensated Eligible Participants and
who are designated to receive such a contribution.
(c) Deemed Date of Allocation. All credits or deductions made under
this Article to Participants' Accounts shall, for all purposes
other than the allocation of Income, be deemed to have been made
no later than the last day of the Plan Year though actually
determined thereafter.
5.4 Maximum Annual Additions. The maximum Annual Additions that may be
contributed or allocated to a Participant's Accounts under the Plan for
any Limitation Year shall not exceed the lesser of:
(i) the defined contribution dollar limitation, or
(ii) 25 percent of the Participant's compensation, as defined
below, for the Limitation Year.
"Compensation" is the Participant's wages, salaries, fees
and other amounts paid or made available for personal
services actually rendered in the course of employment
with the Employer, including, but not limited to,
commissions, compensation for services on the basis of a
percentage of profits, tips and bonuses but (in
accordance with regulations prescribed by the Secretary
of Treasury) excluding:
(A) Contributions made by the Employer to a
non-qualified plan of deferred compensation
to the extent that such are not included in
the gross income of the Participant in the
year made; Employer contributions to
simplified employee
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pension plans which are deductible by the
Participant; and any distributions from any
such plan other than an unfunded
non-qualified plan;
(B) Amounts realized from the exercise of a
non-qualified stock option or when
restricted stock either becomes freely
transferable or free from a substantial risk
of forfeiture:
(C) Amounts realized from the disposition of
stock acquired under a qualified stock
option;
(D) Other amounts which receive special tax
benefits; and
(E) For Plan Years beginning on or before
January 1, 1994, any amount in excess of
$200,000 (as adjusted annually by the
Secretary of the Treasury for increases in
the cost of living) (effective January 1,
1994, $150,000, as adjusted). Such
limitation shall be adjusted and applied in
accordance with the family unit provisions
set forth in Section 2.12.
The compensation limitation referred to shall not apply to:
(i) Any contribution for medical benefits (within the meaning of
Section 419A(f)(2) of the Code) after separation from service
which is otherwise treated as Annual Additions, or
(ii) Any amount otherwise treated as Annual Additions under Section
415(1)(1) of the Code.
The defined contribution dollar limitation shall mean $30,000
or, if greater, one-fourth of the defined benefit dollar
limitation set forth in Section 415(b)(1) of the Code as in
effect for the Limitation Year. All defined contribution plans
of the Employer and Affiliates shall be treated as one plan for
purposes of these limitations. If allocations to any of the
defined contribution plans maintained by the Employer or any
Affiliates on behalf of a Participant for any Limitation Year
would cause the limitations set forth above to be exceeded,
contributions under this Plan shall be reduced first to the
extent necessary and then under any other defined contribution
plans of the Employer or Affiliates.
For purposes of this Section 5.4, all defined contribution plans
maintained by the Employer shall be treated as one defined contribution
plan.
Notwithstanding any other provision of the Plan to the contrary, the
total Annual Additions on behalf of a Participant for a Limitation Year
shall not cause the sum
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of that Participant's defined contribution plan fraction and defined
benefit plan fraction (as those terms are defined in Section 415(e) of
the Code) to exceed 1.0. If the sum of such fractions would exceed 1.0
for any Limitation Year, the excess amount will be eliminated first by
making appropriate adjustments under any defined benefit plan
maintained by the Employer, then under this Plan and then under any
other defined contribution plans maintained by the Employer or
Affiliates.
If the total Annual Additions on behalf of a Participant for a
Limitation Year would exceed the limitations described herein as a
result of a reasonable error in determining the amount of Before Tax
Contributions that a Participant may make without violating the
requirements of Section 5.3 or as a result of a reasonable error in
estimating a Participant's compensation for purposes of this Section,
the Post 1986 After Tax Contribution of the Participant, if any, and if
necessary any excess Before Tax Contributions, may thereafter be
distributed to the Participant to the extent that such distribution
would reduce the excess Annual Additions as permitted under Section 415
of the Code. If Post 1986 After Tax Contributions are so distributed,
such amounts shall be disregarded under Section 4.8 and 4.9. If Before
Tax Contributions are so distributed, such amounts shall be disregarded
under Section 4.6, 4.7 and 4.9 and for purposes of the limitations of
Section 402(g) of the Code. If Before Tax Matched Contributions must be
distributed, any Employer Matched Contribution allocated to a
Participant's Account because of such Before Tax Matched Contributions
shall be placed in a suspense account for the Participant and allocated
during the next Plan Year. If after the distribution or placement in
suspense of Before Tax Contributions, Post 1986 After Tax Contributions
and Employer Matched Contributions, the Annual Additions would exceed
the limitations described herein, discretionary contributions allocated
to a Participant's Company Account shall be withdrawn from the
Participant's Account and placed in a suspense account and will be
allocated to all Participants eligible for a discretionary contribution
in the next Plan Year.
5.5 No Rights Created by Allocation. Any allocation made and credited to
the account of a Participant, Former Participant or Beneficiary under
this Article shall not cause such Participant, Former Participant or
Beneficiary to have any right, title or interest in or to any assets of
the Trust Fund except at the time or tunes, and under the terms and
conditions, expressly provided in this Plan.
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ARTICLE VI
PAYMENT OF BENEFITS
6.1 Retirement or Disability. If a Participant's employment is Terminated
by reason of his Retirement or Disability, then such Participant shall
be entitled to receive the entire amount credited to his Accounts in
the manner and at the time provided in Sections 6.6 and 6.7.
6.2 Death. In the event that the Termination of employment of a Participant
is caused by his death, or in the event that a Participant or Former
Participant who is entitled to receive distributions pursuant to
Section 6.1 or 6.3 dies prior to receiving the full amount of such
distributions, the entire amount credited to his Accounts shall be paid
to his Beneficiary in the manner and at the time provided in Sections
6.6 and 6.7, but only after receipt by the Pension Committee of
acceptable proof of death
6.3 Other Termination of Employment. If a Participant's employment is
Terminated by reason of other termination of employment, then such
Participant shall be entitled to receive the entire amount credited to
his Before Tax Matched Account, Before Tax Supplemental Account,
Rollover Account, Post 1986 After Tax Contribution Account, Pre 1987
After Tax Contribution Account, QNEC Account, Employer Matched Account
and Company Account and the vested percentage of his HMI Company
Regular Account and Raff-Hughes Company Regular Account, in the manner
and at the time provided in Sections 6.6 and 6.7.
6.4 Vesting. A Participant shall have a fully vested and non-forfeitable
interest in all of his Accounts other than his HMI Company Regular
Account and Raff-Hughes Company Regular Account. A Participant's vested
interest in his HMI Company Regular Account and Raff-Hughes Company
Regular Account shall be determined in accordance with the following
schedule:
12 Month Period of Service Vested Percentage
-------------------------- -----------------
Less than 1 0%
1 but less than 2 20%
2 but less than 3 40%
3 but less than 4 60%
4 but less than 5 80%
5 or more 100%
A Participant who is employed by the Employer or an Affiliate upon
attainment of Normal Retirement Age shall be 100% vested in his HMI
Company Regular Account and Raff-Hughes Company Regular Account.
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6.5 Disposition of Forfeitures.
(a) Cash-Out. Upon Termination of employment pursuant to Section
6.3, the vested percentage of a Participant's Accounts shall
be distributed in accordance with Sections 6.6 and 6.7. The
non-vested percentage of his HMI Company Regular Account and
Raff-Hughes Company Regular Account shall be forfeited and
used to reduce future Employer contributions as soon as
administratively feasible following the earlier of (i) the
distribution to the Participant of his vested Accounts, or
(ii) a Period of Severance equal to five consecutive years. A
Participant whose vested interest in any of his Accounts upon
Termination of employment is zero shall be deemed to have
received a distribution of such amount.
(b) Buy-Back. If the Terminated Participant resumes employment
covered by the Plan prior to incurring a Period of Severance
equal to five consecutive years and if he repays to the Plan
prior to the earlier of five years after the date he is
reemployed by the Employer or the date he has incurred a Break
in Service equal to five consecutive years, the amount of the
distribution, if any, he received from his Accounts under
Section 6.3 at his previous Termination of employment, then
(i) the repaid amount plus the amount forfeited from his
previous HMI Company Regular Account and Raff-Hughes Company
Regular Account shall become the beginning balance in his new
Accounts and (ii) the Period of Service, if any, he completes
following his reemployment shall be aggregated with his
pre-Severance from Service Date Period of Service for purposes
of determining his vested percentage in the amounts allocated
to his Accounts prior to his Termination of employment. The
restoration allocation first shall be made from Forfeitures
otherwise available for the Plan Year of restoration. If
Forfeitures are insufficient to allow for complete
restoration, then the Employer shall make an additional
contribution sufficient to restore the forfeited amounts. The
additional Employer contribution shall not constitute an
Annual Addition. In no event will a restoration of a
Participant's non-vested percentage be made if the Participant
returns after incurring a Period of Severance equal to five
consecutive years. If the Terminated Participant is reemployed
prior to incurring a Period of Severance equal to five
consecutive years, but does not repay to the Plan the amount
of distribution he received at his prior Termination of
employment, if any, prior to the earlier of the date he incurs
a Period of Severance equal to five consecutive years or five
years after the date he is reemployed by the Employer, then a
restoration allocation pursuant to this Section 6.5 shall not
be made.
(c) Deferred Distribution. Notwithstanding the foregoing, if a
Participant does not elect to take an immediate distribution
of his entire vested interest in his Account when he
Terminates employment (pursuant to Section 6.6(d)),
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a Forfeiture of the nonvested portion of his HMI Company
Regular Account or Raff-Hughes Company Regular Account shall
not occur until the Participant has incurred a Period of
Severance equal to five consecutive years. As of the end of
the Plan Year in which the Participant Terminates employment,
his HMI Company Regular Account or Raff-Hughes Company Regular
Account shall be divided into two portions, one representing
the Participant's vested percentage and the other representing
the nonvested percentage. Both portions shall continue to be
credited with Income pursuant to Section 5.2(a) until
distributed or forfeited. If such a Participant returns prior
to incurring a Period of Severance equal to five consecutive
years, the vested and non-vested portions of his HMI Company
Regular Account and Raff-Hughes Company Regular Account plus
Income allocated thereto, shall become the beginning balance
in his new HMI Company Regular Account and Raff-Hughes Company
Regular Account. The Period of Service, if any, he completes
following his reemployment, shall be aggregated with his
pre-Severance from Service Date Period of Service for purposes
of determining his new vested interest in the amounts
allocated to such HMI Company Regular Account and Raff-Hughes
Company Regular Account prior to his Termination of
employment. If the Terminated Participant does not return
prior to incurring a Period of Severance equal to five
consecutive years, the nonvested portion of his HMI Company
Regular Account and Raff-Hughes Company Regular Account, plus
Income allocated thereto, shall be forfeited and used to
reduce contributions pursuant to Section 5.2(d) as soon as
administratively feasible after the end of the year in which
his Period of Severance equal to five consecutive years
occurs.
If the Terminated Participant does not receive a distribution
of the vested percentage of his Accounts and does not return
to the employ of the Employer prior to incurring a Period of
Severance equal to five consecutive years, any amounts held
under a Participant's HMI Company Regular Account and
Raff-Hughes Company Regular Account that are not forfeited,
that are attributable to the Participant's service prior to
the Period of Severance equal to five consecutive years and
that are not distributed, shall be fully vested and
nonforfeitable at all times notwithstanding any other
provisions of this Plan.
6.6 Time of Payment of Benefits.
(a) Subject to subsection (d), a distribution to a Participant of
his Accounts due to Retirement or Disability pursuant to
Section 6.1 shall be made as soon as administratively feasible
following receipt by the Pension Committee of the appropriate
notice and shall be valued as of the last completed Valuation
Date preceding the distribution.
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(b) Distribution of a Participant's Accounts, payable on account
of the death of a Participant or Former Participant pursuant
to Section 6.2, shall be distributed as soon as
administratively feasible following the earlier of (i) receipt
by the Pension Committee of the appropriate form; or (ii) the
end of the three-month period commencing on the date the
Pension Committee is notified of such death but no later than
December 31 of the year which includes the fifth anniversary
of the Participant's death. The distribution shall be valued
as of the last completed valuation preceding the distribution.
However, if such distribution had already commenced in the
form of payments over a period permitted under Section 6.7,
the remaining benefits may be distributed over such period, at
least as rapidly as payments were made to the Participant.
Notwithstanding the foregoing, if a Participant or Former
Participant's Beneficiary is the surviving Spouse, then a
distribution on account of the death of the Participant or
Former Participant must commence no later than December 31 of
the calendar year in which the Participant or Former
Participant would have attained age 70-1/2, valued as of the
last completed valuation date preceding the distribution.
(c) Subject to subsection (d) of this Section 6.6, a distribution
to a Participant of the vested percentage of his Accounts
payable on account of other Termination of employment pursuant
to Section 6.3, shall be made as soon as administratively
feasible following receipt by the Pension Committee of the
appropriate form and shall be valued as of the last completed
valuation preceding the distribution.
(d) If the vested percentage of a Participant's Accounts exceeds
$3,500 (determined at any time), no distribution from a
Participant's Accounts may be made prior to a Participant's
Normal Retirement Date (other than as a result of death)
without obtaining the Participant's consent, as may be
required by the Code and applicable regulations thereunder, to
such distribution being made prior to his Normal Retirement
Date. If the Former Participant does not consent to such
distribution, benefits shall remain in the Trust Fund and
shall continue to receive Income allocations pursuant to
Section 5.2(a) and shall not be distributed to the Participant
(or his Beneficiary) until receipt by the Pension Committee of
the appropriate distribution request form, valued as of the
completed valuation date preceding the filing of such form,
subject to Section 6.6(f).
No such consent shall be valid unless the Participant has been
furnished not more than 90 days nor less than 30 days prior to
the date as of which the distribution is to be made with
notice of his right to defer the distribution until the
Participant attains his Normal Retirement Date and a statement
as to the effect of such a deferral on the Former
Participant's rights under the Plan. Notwithstanding this
minimum notice period, a
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Participant may, after being advised of his right to defer the
distribution and of his right to consider his distribution
options for a minimum of 30 days, elect in writing to the
Pension Committee to waive the 30 day minimum period between
receipt of such notice and the distribution.
(e) Notwithstanding any other provision of this Plan to the
contrary, unless the Participant or Former Participant elects
otherwise, payment of benefits under this Plan shall commence
not later than sixty (60) days after the close of the Plan
Year in which the latest of the following events occurs: (a)
the Participant or Former Participant attains age 65; (b) the
tenth (10th) anniversary of the Plan Year in which the
Participant or Former Participant commenced participation in
the Plan; or (c) the Termination of the Participant's service
with the Employer.
(f) Distribution of a Participant's Accounts, following his
attainment of age 70-1/2, must commence no later than April 1
of the calendar year following the calendar year in which the
Participant or Former Participant attains age 70-1/2. The
foregoing shall not apply to any Participant who (i) has
attained age 70-1/2 before January 1, 1988 and (ii) is not a
five percent (5%) owner of the Employer, as defined in Section
416(i)(B) of the Code at any time during the Plan Year ending
with or within the calendar year in which he attains age
66-1/2 and any subsequent Plan Year. Distribution shall be
made in accordance with the minimum distribution requirements
under Section 401(a)(9) of the Code that is incorporated by
reference including the regulations issued pursuant thereto
and shall be made in accordance with the minimum distribution
incidental benefit requirements under Prop. Treas. Reg.
1.401(a)(9)-2.
6.7 Mode and Method of Payment of Benefits. Any amount to which a
Participant, Former Participant or Beneficiary shall become entitled to
hereunder shall be distributed in cash in accordance with one of the
following forms of distribution as elected by the Participant.
(a) Equal quarterly or annual installments over a period of time
not to exceed the life expectancy of the Participant, or the
joint life expectancy of the Participant and his Beneficiary.
(b) Equal quarterly or annual installments over a period of 10
years.
(c) Single lump sum payment.
Notwithstanding the foregoing, a Participant who previously
participated in Merged Plan II and for whom amounts were transferred
from Merged Plan II to this Plan shall be subject to the provisions of
Merged Plan II, as set forth in Exhibit A to the Plan.
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Notwithstanding the foregoing, a distribution made under this Section
6.7 for the sole purpose of satisfying the requirements set forth in
Section 6.6(f), shall be made in a lump sum.
All distributions shall satisfy the incidental death limitations of
Section 401(a)(9)(G) of the Code, including the maximum distribution
incidental benefit requirement and the pre-retirement incidental
benefit requirement as set forth in Treas. Reg. 1.401-1(b)(ii) by
payment in a lump sum.
6.8 Designation of Beneficiary. Each Participant or Former Participant from
time to time may designate any person or persons (who may be designated
contingently or successively and who may be an entity other than a
natural person) as his Beneficiary or Beneficiaries to whom his Plan
benefits are to be paid if he dies before receipt of all such benefits.
Each Beneficiary designation shall be made on a form prescribed by the
Pension Committee and will be effective only when filed with it during
the Participant's or Former Participant's lifetime. Each Beneficiary
designation filed with the Pension Committee will cancel all
Beneficiary designations previously filed with it by that Participant
or Former Participant. The revocation of a Beneficiary designation, no
matter how effected, shall not require the consent of any designated
Beneficiary. In the case of a Participant who participated in the TAG
Savings Plan immediately before the Effective Date or whose accounts
were transferred to this Plan from the TAG Savings Plan pursuant to
Section 3.8, a Beneficiary designation made by the Participant pursuant
to the terms of the TAG Savings Plan shall be treated as a Beneficiary
designation made under this Plan.
Notwithstanding the foregoing, the surviving Spouse of a Participant or
Former Participant shall be deemed to be the Participant's or Former
Participant's designated Beneficiary, and shall be entitled to receive
in a lump sum any distribution on account of the Participant's or
Former Participant's death, unless the Participant or Former
Participant designates a Beneficiary other than the surviving Spouse
and such surviving Spouse consents irrevocably in writing to the
designation of such Beneficiary and the Spouse's consent acknowledges
the effect of such designation and is witnessed by a notary public. The
requirements of this paragraph may be waived if it is established to
the satisfaction of the Pension Committee that the consent may not be
obtained because there is no Spouse or because the Spouse cannot be
located or because of such other circumstances as may be prescribed by
regulation.
In the event that the Participant failed to designate a Beneficiary or
is predeceased by all designated primary and contingent beneficiaries,
death benefits under this Plan shall be payable to his surviving
Spouse, if any, and if none to the Participant's estate.
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6.9 Withdrawals. A Participant may make withdrawals from his Accounts,
valued as of the last Valuation Date. In no event may a Participant
make withdrawals more frequently than twice in any Plan Year.
(a) Hardship Withdrawal. A Participant may withdraw: (i) up to
100% of the value of his Before Tax Contributions; (ii) Income
allocated to his Before Tax Matched and Before Tax
Supplemental Accounts as of December 31, 1988; and (iii) up to
100% of his Employer Matched Account, Rollover Account and
Company Account on account of an immediate financial hardship
as defined below.
A withdrawal in the case of an immediate financial hardship
shall only be permitted if it is not in excess of the amount
of the immediate and heavy financial need of the Participant,
as evidenced in documentation that is satisfactory to the
Pension Committee and if the Pension Committee determines that
the withdrawal is necessary in light of immediate and heavy
financial needs of the Participant due to:
(A) medical expenses described in Section 213(d) of the
Code and incurred by the Participant, his Spouse, or
any of the Participant's dependents (as defined in
Section 152 of the Code), or expenses necessary for
these individuals to obtain medical care described in
Section 213(d) of the Code, as long as such expenses
are ineligible for reimbursement under any health
care plans and as long as the Participant submits the
expense for a hardship withdrawal within six months
of the date the medical service was rendered or
purchased;
(B) costs directly related to the purchase (excluding
mortgage payments) of a principal residence of the
Participant;
(C) the payment of tuition and related educational fees
for the next twelve-months of post-secondary
education for the Participant, his Spouse, children
or dependents (as defined in Section 152 of the
Code); or
(D) payments necessary to prevent the eviction of the
Participant from his principal residence or
foreclosure on the mortgage of the Participant's
principal residence.
The Participant may request that any hardship distribution
shall be increased by the amount the Pension Committee
reasonably determines to be the tax liability (Federal, state,
or local) the Participant will incur because of the
distribution but not in excess of the Participant's Account
balance.
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Withdrawals due to financial hardship shall be permitted only
if the following conditions are satisfied:
(1) The Participant shall have obtained all other
withdrawals and nontaxable loans, if any, available
to him under the Plan and under all other Employer
plans;
(2) If a Participant makes a hardship withdrawal under
subsection (a)(i) or (a)(ii), the Employer shall be
precluded from making Before Tax Contributions and
Employer Matched Contributions on the Participant's
behalf and the Employee shall be prohibited from
making Post 1986 After Tax Contributions to this Plan
and employee contributions to all other plans of the
Employer coincident with or next following the date
that is 12 months from the date on which the
withdrawal is received by the Participant. All other
plans of the Employer shall mean all qualified and
nonqualified plans of deferred compensation
maintained by the Employer, including any of the
Merged Plans under which voluntary Employee after-tax
contributions were permitted. A Participant whose
participation in the Plan is suspended shall be
required to reenroll in the Plan at the end of the
suspension period in order to resume Before Tax
Contributions and Post 1986 After Tax Contributions
to the Plan; and
(3) If a Participant makes a hardship withdrawal under
subsection (a)(i) or (a)(ii), the Employer shall not
make, and the Participant shall not authorize the
Employer to make, Before Tax Contributions on the
Participant's behalf for the Plan Year immediately
following the Plan Year of such withdrawal in an
amount in excess of the applicable dollar limitation
imposed by Section 4.1(a)(iii) (and as described in
Section 402(g) of the Code), reduced by the amount of
the Participant's Before Tax Contributions in the
Plan Year in which such withdrawal is made.
(b) Withdrawal of Post 1986 and Pre 1987 After Tax Contribution
Accounts. A Participant may make a withdrawal from his Post
1986 After Tax Contribution Account and Pre 1987 After Tax
Contribution Account for any reason, including Income
attributable to such Account.
(c) Attainment of Age 59-1/2. Except as provided in subsection
(d)(1), a Participant may withdraw up to 100% of the vested
percentage of all his Accounts, including Income attributable
to such Accounts, for any reason upon attainment of age
59-1/2.
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(d) General Rules. The withdrawals under this Section 6.10 shall
be subject to the following requirements:
(1) In no event may a Participant make a withdrawal from
his QNEC Account, HMI Company Regular Account, or
Raff-Hughes Company Regular Account.
(2) Only two withdrawals in any Plan Year shall be
permitted.
(3) A request for a withdrawal shall be processed as soon
as administratively feasible following receipt of the
withdrawal request by the Pension Committee.
(4) The minimum amount allowable for withdrawal shall be
$300.00; provided, however, that a Participant may
make a hardship withdrawal in accordance with Section
6.10(a) in an amount less than $300.00.
(5) The amount available for withdrawal shall be
determined as of the Valuation Date preceding the
withdrawal, but in no event may a Participant
withdraw more than the amount then standing in the
applicable account as of the date of withdrawal.
(6) A withdrawal shall be charged to the Participant's
investment fund(s) on a pro-rata basis.
(e) Processing of Withdrawals. All withdrawals shall be processed
on a pro-rata basis from the funds in which a Participant's
Accounts are invested, in the following order:
(1) Pre 1987 After Tax Contribution Account attributable
to Pre 1987 After Tax Contributions.
(2) The remaining portion of a Participant's Pre 1987
After Tax Contribution Account and the entire Post
1986 After Tax Contribution Account of a Participant.
(3) The Participant's Employer Matched Contribution
Account.
(4) The Participant's Company Contribution Account.
(5) The Participant's Rollover Contribution Account.
(6) Amounts attributable to Before Tax Matched and Before
Tax Supplemental Contributions and Income allocated
to a Participant's
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Before Tax Matched and Before Tax Supplemental
Contribution Accounts as of December 31, 1988.
6.10 Loans to Participants. The Pension Committee may direct the Trustee to
lend a Participant an amount not in excess of the lesser of (i) 50% of
his vested Accounts or (ii) $50,000 (reduced by the excess, if any, of
the highest outstanding balances of all other loans from the Plan
during the one-year period ending on the day before the loan was made
over the outstanding balance of loans from the Plan on the date on
which such loan was made), determined as of the last completed
valuation coincident with or immediately preceding the date the
Participant applies for the loan. A Participant may have only one loan
outstanding at any time. Subject to the rules of the Pension Committee
as set forth below, the Trustee, upon application by a Participant, may
make a loan to such Participant for any purpose.
In addition to such rules as the Pension Committee may adopt, all loans
shall comply with the following terms and conditions:
(a) An application by a Participant for a loan from the Plan shall
be made to the Pension Committee whose action thereon shall be
final.
(b) The period of repayment for any loan shall be arrived at by
mutual agreement between the Pension Committee and the
borrower, but such period shall not exceed five years except
for loans used to acquire the Participant's principal
residence. Loans used to acquire a Participant's principal
residence shall not exceed ten (10) years. All loan terms
shall be in multiples of one year. Repayment of interest and
principal shall be according to a substantially level
amortization schedule of payments beginning with the first
payroll period following receipt of the loan. Repayment of
interest and principal shall be by payroll deduction, except
for those Participants who are not receiving a paycheck or who
are laid off with recall rights, with respect to whom a loan
repayment check shall be due in accordance with the
amortization schedule in effect. Loans may be prepaid in full
at any time without penalty; provided, however, that a
Participant must wait three months before requesting another
loan. Loan repayments shall be allocated to a Participant's
Accounts on a pro-rata basis to those Accounts from which the
loan was distributed as set forth in Section 6.11(j) below and
shall be invested pursuant to a Participant's current
investment elections.
(c) Each loan shall be made against collateral being the
assignment of the borrower's right, title and interest in and
to the Trust Fund to the extent of the borrowed amount,
supported by the borrower's collateral promissory note for the
amount of the loan, including interest, payable to the order
of the Trustee.
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(d) Subject to the regulations of the U.S. Department of Labor,
each loan shall bear interest equal to the prime lending rate
of the Bank of New York in effect on Monday of the week in
which the loan was approved or such other rate determined by
the Pension Committee.
(e) The minimum amount available for any loan is $1,000.00.
(f) The procedure to be followed by a Participant in applying for
a loan shall be determined by the Pension Committee and
documented by a duly approved set of rules of the Pension
Committee. Such rules shall be attached to and shall be deemed
to be a part of the Plan as Exhibit B. Prior to January 1,
1991, loans with respect to Merged Plan III and prior to
January 1, 1992, loans with respect to Merged Plans IV and V,
were determined in accordance with the procedures set forth in
Exhibits B, C and D applicable to such Plans, which are
incorporated herein by reference. Loans with respect to any
amounts transferred to this Plan from the TAG Savings Plan
attributable to the Raff-Hughes Plan were determined in
accordance with the procedure set forth in Exhibit C, which is
incorporated herein by reference.
(g) A loan shall not be made in an amount that would result in a
payroll deduction for the Participant greater than the amount
of the Participant's net pay (after all other deductions).
(h) In the event of (i) default on the loan or (ii) the
Participant's Termination of employment prior to repayment of
the entire loan balance, the Participant shall have the option
to repay the remaining loan balance in full no later than two
weeks (three months, effective for loans outstanding on or
after December 31, 1993) following the Participant's
Termination of employment. If the loan is not repaid, there
shall be distributed to the Participant upon his Termination
of employment the sum of (i) the value of the Participant's
Accounts without regard to the amount of any outstanding loan
(including any accrued interest thereon) plus (ii) the
Participant's promissory note. Notwithstanding the foregoing,
if the sum of (i) and (ii) exceeds $3,500, then such amount
shall be distributed to the Participant only in accordance
with Section 6.6(d) hereof. If the Participant does not
consent to take a full distribution of the sum of (i) plus
(ii), there shall be distributed to the Participant the
promissory note and the remaining value of the Participant's
Accounts shall be distributed in accordance with Section
6.6(d).
For purposes of this Section 6.11, default means a
Participant's failure to repay the loan when due in accordance
with the procedures outlined in subsection (b) hereof.
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(i) Notwithstanding anything herein to the contrary, the Pension
Committee may direct the Trustee to lend a Former Participant
who is a "party in interest" as that term is defined in
Section 3(14) of ERISA, an amount not to exceed the amount set
forth in the first paragraph of Section 6.11. In such case,
the rules set forth in Section 6.11 shall apply to such loan,
provided, however, that repayment of such loan shall not be by
payroll deduction. Repayment shall be made by the Former
Participant by check or money order payable to the Trustee,
based on a monthly repayment schedule established by the
Pension Committee when the Former Participant makes
application for the loan
(j) All loans shall be processed on a pro-rata basis from the
funds in which a Participant's Accounts, other than the
Investment Fund holding Acordia Stock, are invested, in the
following order:
(1) Amounts attributable to a Participant's Before Tax
Contribution Accounts.
(2) Amounts attributable to a Participant's vested HMI
Company Regular Account or vested Raff-Hughes Company
Regular Account.
(3) Amounts attributable to a Participant's Company
Account.
(4) Amounts attributable to a Participant's Rollover
Account.
(5) Amounts attributable to a Participant's Post 1986
After Tax Contribution Account.
(6) Amounts attributable to a Participant's Pre 1987
After Tax Contribution Account.
(k) All loans shall comply with the Plan's Participant Loan
Procedures adopted from time to time by the Pension Committee,
which shall be deemed to constitute a part of this Plan
6.11 Direct Rollover Option. (Effective for distributions made on or after
January 1, 1993) A distributee may elect, at the time and in the manner
prescribed by the Employer, 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 paragraph,
the following terms shall be defined as follows:
(a) An "eligible rollover distribution" is any distribution of all
or any portion of the balance to the credit of the
distributee, except that an eligible rollover distribution
does not include: any distribution that is one of a
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series of substantially equal periodic payments (not less
frequently than annually) made for the life (or life
expectancy) of the distributee or the joint lives (or joint
life expectancies) of the distributee and the distributee's
designated beneficiary, or for a specified period of ten years
or more; any distribution to the extent such distribution is
required under Section 401(a)(9) of the Code; and the portion
of any distribution that is not includable in gross income
(determined without regard to the exclusion for net unrealized
appreciation with respect to employer securities).
(b) An "eligible retirement plan" is an individual retirement
account described in Section 408(a) of the Code, an individual
retirement annuity described in Section 408(b) of the Code, an
annuity plan described in Section 403(a) of the Code, or a
qualified trust described in Section 401(a) of the Code, that
accepts the distributee's eligible rollover distribution.
However, in the case of an eligible rollover distribution to
the surviving spouse, an eligible retirement plan is an
individual retirement account or individual retirement
annuity.
(c) A "distributee" includes an Employee or Former Employee. In
addition, the Employee's or Former Employee's surviving spouse
and the Employee's or Former Employee's spouse or former
spouse who is the alternate payee under a qualified domestic
relations order, as defined in Section 414(p) of the Code, are
distributees with regard to the interest of the spouse or
former spouse.
(d) A "direct rollover" is a payment by the Plan to the eligible
retirement plan specified by the distributee.
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ARTICLE VII
TRUST FUND
7.1 Exclusive Benefit of Eligible Employees and Beneficiaries. All
contributions under this Plan shall be paid to the Trustee and
deposited in the Trust Fund. All assets of the Trust Fund, including
investment Income, shall be retained for the exclusive benefit of
Participants, Former Participants and Beneficence and shall be used to
pay benefits to such persons or to pay administrative expenses of the
Plan and Trust Fund to the extent not paid by the Employer. Except as
provided in Sections 4.4 or 12.2 or as otherwise permitted by law, the
assets of the Trust Fund shall not revert to or inure to the benefit of
the Employer.
7.2 Investment Directions by Participants.
(a) Investment Funds. All Accounts will be invested in the common
Investment Funds that the Pension Committee may designate from
time to time. The respective assets of each Investment Fund
will be accounted for separately from those of each other
Investment Fund and will be invested in accordance with the
objectives prescribed by the Pension Committee. A portion of
an Investment Fund may be invested in short-term securities
issued or guaranteed by the United States of America or any of
its agencies or instrumentalities or any other investments of
a short-term nature, including corporate obligations or
participation therein, and through the medium of any common,
collective, or commingled trust fund maintained by the Trustee
which is invested principally in property of the kind
specified in this subsection. A portion of an Investment Fund
may be maintained in cash.
(b) Participant Direction (Prior to 1994.)
(i) Future Contributions. A Participant may direct the
investment of future contributions to his Accounts
among the Investment Funds. A Participant may elect
to change the manner in which future contributions to
his Accounts are invested effective as of the first
pay date in the following month, upon written
notification to the Pension Committee no later than
the 20th day of the month immediately preceding that
month (or such other date as established by the
Pension Committee); provided that, unless the Pension
Committee determines otherwise, in no event shall a
Participant be permitted to make another change
regarding investment of future contributions under
this Section more frequently than once every three
months.
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(ii) Rollover Contributions. A Participant for whom
amounts are rolled over to the Plan pursuant to
Section 4.10 shall make a separate election with
respect to the initial investment of those amounts.
(iii) Current Accounts. A Participant may, effective as of
the last day of any calendar month elect to
reallocate the value of all of his Accounts (in
accordance with a single election to be applied
uniformly to all of his Accounts) among the
Investment Funds, in multiplies of ten percent (10%)
by giving written notice to the Pension Committee no
later than the 20th day (or such other date as the
Pension Committee may determine) of that month. The
Pension Committee may, on a uniform and
nondiscriminatory basis, adopt such rules and
procedures as it deems necessary to limit the
frequently with which Participants may reallocate the
value of these Accounts; provided that, unless the
Pension Committee determines otherwise, in no event
shall a Participant be permitted to make such a
reallocation of Accounts under this Section more
frequently than once every three months.
(iv) Raff-Hughes Participants. Participants who elected to
have amounts transferred on their behalf to this Plan
from the Raff-Hughes Plan may, effective as of any
June 30 or December 31, elect to invest the
transferred amounts among the Investment Funds in
percentages of ten percent (10%).
(v) Robinson-Conner Participants. Prior to the merger of
the Robinson-Conner Plan with this Plan, effective
January 1, 1992, each Participant who was a
participant in the Robinson-Conner Plan and whose
accounts in the Robinson-Conner Plan were invested in
life insurance policies, was permitted to designate
by December 20, 1991, one of the following three
options for disposition of those policies;
(a) Cancellation of existing policies, upon
which the cash surrender value of the policy
was added to the Participant's Accounts;
(b) Purchase by the Participant of existing
policies equal to the fair market value plus
any premium deficit;
(c) Distribution of existing policies to the
Participant.
Any Participant who failed to make a written election
by December 20, 1991, was deemed to have elected
option (a). Subsequent to disposition of the
policies, Participants were offered the investment
opportunities set forth in this Section for
investment of their Accounts held under this Plan.
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(vi) Failure to Direct Investments. In the event that a
Participant fails to make an investment election, the
Trustee shall invest his Accounts in an Investment
Fund designated from time to time by the Pension
Committee.
(c) Participant Direction (After 1991).
(i) Future Contributions. A Participant may direct the
investment of future contributions to his Accounts
among the Investment Funds by providing notice to the
Pension Committee in the manner and subject to the
procedures specified by the Pension Committee. A
Participant may elect to change the manner in which
future contribution to his Accounts are invested as
of any business day, but not more than once each
calendar month, by providing notice to the Pension
Committee in the manner and subject to the procedures
specified by the Pension Committee.
(ii) Existing Accounts. A Participant may, effective as of
any business day, elect to reallocate the value of
all of his Accounts in the Plan (in accordance with a
single election to be applied uniformly to all of his
Accounts), in multiplies of ten percent (10%) among
the Investment Funds, by giving notice to the Pension
Committee in the manner and subject to the procedures
specified by the Pension Committee. The Pension
Committee may, on a uniform and nondiscriminatory
basis, adopt such rules and procedures as it deems
necessary to limit the frequency with which
Participants may reallocate the value of their
Accounts.
(iii) Effective Date of Investment Elections.
Notwithstanding the foregoing, the Pension Committee
is not obligated to effect investment election
changes as of the business day the Participant gives
notice of the change to the Pension Committee; the
Pension Committee is only obligated to apply its best
efforts to effectuate the Participant's investment
election as soon as administratively feasible.
(iv) Failure to Direct Investments. In the event that a
Participant fails to make an investment election, the
Trustee shall invest his Accounts in an Investment
Fund designated from time to time by the Pension
Committee.
(d) Effect of Participant Direction on Fiduciaries. When a
Participant exercises his option to direct the investment of
his Accounts in accordance with this Section, then to the
extent permitted by ERISA, no person who is otherwise a
fiduciary under the Plan shall be liable under ERISA for any
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loss, or by reason of any breach, that results from the
Participant's exercise of that option.
7.3 Acordia Stock.
(a) Limitation on Acordia Stock Investment. Notwithstanding any
other provisions of the Plan, the following rules shall apply
with respect to the investment of a Participant's Accounts in
Acordia Stock:
(1) As of the Effective Date, in accordance with rules
prescribed by the Pension Committee, a Participant
may direct the investment of up to 20% of the total
amount in his Accounts as of August 31, 1992 into
Acordia Stock;
(2) The maximum amount of future contributions to a
Participant's Accounts that may be invested in
Acordia Stock shall be 20%; and
(3) The maximum amount of a Participant's Accounts that
may be reallocated to Acordia Stock shall be an
amount, which when added to amounts already invested
in Acordia Stock, results in no more than 20% of the
total of a Participant's accounts being invested in
Acordia Stock.
(b) Voting Rights. Each Participant (or Beneficiary of a deceased
Participant) is designated, for purposes of this Section
73(b), a "named fiduciary" (within the meaning of ERISA) with
respect to the shares of Acordia Stock held in his Accounts,
and he shall have the right to direct the Trustee with respect
to the voting of the shares of Acordia Stock held in his
Accounts on each matter brought before any meeting of
shareholders; provided that the right shall only apply with
respect to shares of Acordia Stock held in the Participant's
Accounts as of the most recent Valuation Date coincident with
or preceding the applicable record date. Before each meeting
of shareholders, the Company shall cause to be furnished to
each Participant (or Beneficiary of a deceased Participant) a
copy of the proxy solicitation material. At least 10 days
prior to the date of the shareholders' meeting at which such
voting rights will be exercised, the Participant (or
Beneficiary) may complete and file with the Trustee a written
direction, in the form and manner prescribed by the Pension
Committee, as to how the shares of Acordia stock held in his
Accounts shall be voted. Upon timely receipt of the
directions, the Trustee shall vote as directed the number of
shares (including fractional shares) of Acordia Stock held in
the Participant's Accounts, and the Trustee shall have no
discretion as to the manner. The instructions received by the
Trustee from Participants (or Beneficiaries) shall be held by
the Trustee in confidence and shall not be divulged or
released to any person, including the Pension Committee or
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officers or employees of the Company or any Employer or
Affiliate. The Pension Committee, in its discretion, shall
direct the Trustee as to the voting of any shares of Acordia
Stock held in the Plan for which the Trustee has not received
a specific direction from a Participant (or Beneficiary).
(c) Response to Tender Offers. Each Participant (or Beneficiary of
a deceased Participant) is designated, for purposes of this
Section 7.3(c), a "named fiduciary" (within the meaning of
ERISA) with respect to the shares of Acordia Stock held in his
Accounts, and he shall have the right to direct the Trustee as
to how to respond with respect to those shares to a tender
offer or to any other offer made to shareholders generally to
purchase, exchange, redeem, or otherwise transfer shares;
provided that the right shall only apply to the Acordia Stock
held in the Participant's Account as of the Valuation Date
coincident with or immediately preceding the first day for
delivering shares or otherwise responding to the tender offer
or other offer. At least 10 days prior to the last date for
delivering shares or otherwise responding to the tender offer
or other offer, the Participant or Beneficiary may complete
and file with the Trustee a written direction in the form and
manner prescribed by the Pension Committee. Upon timely
receipt of a written direction to deliver the shares of
Acordia Stock in the Participant's Accounts in response to the
tender or other offer, the Trustee shall deliver the shares to
which the direction applies. The Trustee shall not deliver, in
response to the tender or other offer, any shares as to which
the Trustee has received a direction from a Participant (or
Beneficiary) not to deliver the shares. The directions
received by the Trustee from Participants (or Beneficiaries)
shall be held by the Trustee in confidence and shall not be
divulged or released to any person, including the Pension
Committee or officers or employees of the Company or any
Employer or Affiliate. The Pension Committee, in its
discretion, shall direct the Trustee as to how to respond to
the tender or other offer with respect to any shares of
Acordia Stock held in the Plan for which the Trustee has not
received a specific direction from a Participant (or
Beneficiary).
7.4 Special Rules Applicable to Persons Subject to Section 16(b) of the
Securities Exchange Act of 1934. Notwithstanding any other provisions
of the Plan, the following special rules shall apply to Participants or
former Participants who are subject to the requirements of Section
16(b) of the Securities Exchange Act of 1934 ("Insiders"):
(a) If an Insider completely suspends the authorization of future
Before Tax Contributions and/or post-1986 After Tax
Contributions that are to be invested in Acordia Stock, then
until the day after six months from the date of that
suspension the Insider shall not be permitted to:
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(i) Once again authorize the investment of future Before
Tax Contributions and/or post-1986 After Tax
Contributions in Acordia Stock; or
(ii) Reallocate the investment of amounts held in his
Accounts into Acordia Stock pursuant to Section 7.2.
(b) At the option of the Insider, an Insider may make a withdrawal
from his Accounts under Section 6.10 under the procedures set
forth in (i) or (ii):
(i) If the withdrawal will result in a reduction in the
number of shares of Acordia Stock in his Accounts,
the withdrawal must be made pursuant to an election
that becomes irrevocable at least six months prior to
the date of receipt of the withdrawal. If the
withdrawal is made, then until the day after the
six-months from the Insider's receipt of the
withdrawal, the Insider shall not be permitted to:
(A) once again authorize or continue to
authorize the investment of any future
Before Tax Contributions and/or post-1986
After Tax Contributions to the Plan to be
invested in Acordia Stock; or
(B) reallocate the investment of amounts held in
his Accounts into Acordia Stock pursuant to
Section 7.2.
(ii) An Insider may make a withdrawal from his Accounts
under Section 6.10 other than pursuant to the
six-month irrevocable election described in
subparagraph (i) only if the withdrawal does not
result in a reduction in the number of shares of
Acordia Stock in his Accounts. If the withdrawal is
made, the Insider's ability to authorize investment
of future Before Tax Contributions and/or post-1986
After Tax Contributions to the Plan to be invested in
Acordia Stock or to reallocate the investment of
amounts held in his Accounts into Acordia Stock shall
not be affected.
(c) (i) An Insider may elect to reallocate amounts held
in his Accounts pursuant to Section 7.2 in a manner
that would increase or decrease the number of shares
of Acordia Stock in his Accounts only pursuant to an
election that becomes irrevocable at least six months
prior to date as of which the reallocation would be
effective.
(ii) At the option of the Insider, the six-month prior
irrevocable election described in subparagraph (i)
shall not be required with respect to elections
pursuant to Section 7.2 to reallocate the investment
of amounts held in his Accounts that will result in
an
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increase or decrease in the number of shares of
Acordia Stock in his Accounts if such elections are
made during the quarterly window period described in
the following sentence. The quarterly window period
shall be the period beginning on the third business
day that begins following the date of release to the
public of quarterly or annual statements of sales and
earnings on each March 31, June 30, September 30, and
December 31, respectively, and ending on the 12th
business day following such release. The foregoing
option shall not be available if any such election to
reallocate the investment of amounts held in his
Accounts pursuant to Section 7.2 has been made during
the six-month period ending on the date on which the
most recent such election would have been effective.
(d) None of the special rules described in this Section shall
preclude the Trustee from using cash dividends paid on Acordia
Stock to purchase additional shares of such stock for any
Insider.
(e) The restrictions imposed under Section 7.4(a)(i) above shall
not apply if the reason an Insider has suspended future Before
Tax Contributions and/or post-1986 After Tax Contributions to
the Plan is because he has reached the limit on such
contributions set forth in Section 402(g) of the Code or
because the Pension Committee has taken action pursuant to
Section 4.6.
(f) The provisions of this Plan are intended to comply with all
applicable provisions of Rule 16(b)-3 of the Securities
Exchange Act of 1934 and its successors with respect to
Insiders. To the extent any provision of the Plan or action by
the Pension Committee on behalf of an Insider fails to so
comply, such provision action shall be deemed null and void to
the extent permitted by law and deemed advisable by the
Pension Committee.
(g) Any amendment affecting the ability of an Insider to authorize
the investment of contributions to his Accounts in Acordia
Stock, reallocate the investment of amounts held in his
Accounts into or out of Acordia Stock, or otherwise to affect
voluntarily the amount of Acordia Stock held in his Accounts
shall be effective with respect to Insiders no earlier than
the day after six months from the effective date of the last
such amendment under the Plan, unless that amendment must be
effective earlier to comply with the requirements of ERISA or
the Code.
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ARTICLE VIII
ADMINISTRATION
8.1 Duties and Responsibilities of Fiduciaries; Allocation of
Responsibility Among Fiduciaries for Plan and Trust Administration. A
Fiduciary shall have only those specific powers, duties,
responsibilities and obligations as are specifically given him under
this Plan or the Trust. In general, the Employer, shall have the sole
responsibility for making the contributions provided for under Section
4.1. The Board of Directors shall have the sole authority to appoint
and remove the Pension Committee and to amend or terminate, in whole or
in part, this Plan or the Trust. The Pension Committee shall have the
sole responsibility for the administration of this Plan, which
responsibility is specifically described in this Plan and the Trust and
the right to appoint and remove the Trustee and any Investment Manager
which may be provided for under the Trust and to designate investment
and funding policies under which the Trustee and any Investment Manager
shall act. Except as provided in the Trust agreement and within the
scope of any funding and investment policies designated by the Pension
Committee, the Trustee shall have the sole responsibility for the
administration of the Trust and the management of the assets held under
the Trust. It is intended that each Fiduciary shall be responsible for
the proper exercise of his own powers, duties, responsibilities and
obligations under this Plan and the Trust and generally shall not be
responsible for any act or failure to act of another Fiduciary. A
Fiduciary may serve in more than one fiduciary capacity with respect to
the Plan (including service both as Trustee and as a member of the
Pension Committee).
8.2 Allocation of Duties and Responsibilities. The Pension Committee may
designate in writing persons other than its members to carry out any of
its duties and responsibilities. Any duties and responsibilities thus
allocated must be described in the written instrument. If any person
other than an Eligible Employee of the Employer is so designated, such
person must acknowledge in writing his acceptance of the duties and
responsibilities thus allocated to him. All such instruments shall be
attached to, and shall be made a part of, the Plan.
8.3 Expenses. The Employer shall pay all expenses authorized and incurred
by the Pension Committee in the administration of the Plan except to
the extent such expenses are paid from the Trust.
8.4 Claims Procedure.
(a) Filing of Claim. Any Participant, Former Participant or
Beneficiary under the Plan ("Claimant"), may file a written
claim for a Plan benefit with the Pension Committee or with a
person named by the Pension Committee to receive claims under
the Plan.
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(b) Notification on Denial of Claim. In the event of a denial or
limitation of any benefit or payment due to or requested by
any Claimant, he shall be given a written notification
containing specific reasons for the denial or limitation of
his benefit. The written notification shall contain specific
reference to the pertinent Plan provisions on which the denial
or limitation of benefits is based. In addition, it shall
contain a description of any additional material or
information necessary for the Claimant to perfect a claim and
an explanation of why such material or information is
necessary. Further, the notification shall provide appropriate
information as to the steps to be taken if the Claimant wishes
to submit his claim for review. This written notification
shall be given to a Claimant within 90 days after receipt of
his claim by the Pension Committee unless special
circumstances require an extension of time to process the
claim. If such an extension of time for processing is
required, written notice of the extension shall be furnished
to the Claimant prior to the termination of said 90-day period
and such notice shall indicate the special circumstances which
make the postponement appropriate.
(c) Right of Review. In the event of a denial or limitation of
benefits, the Claimant or his duly authorized representative
shall be permitted to review pertinent documents and to submit
to the Pension Committee issues and comments in writing. In
addition, the Claimant or his duly authorized representative
may make a written request for a full and fair review of his
claim and its denial by the Pension Committee provided,
however, that such written request must be received by the
Pension Committee (or his delegate to receive such requests)
within sixty days after receipt by the Claimant of written
notification of the denial or limitation of the claim. The
sixty day requirement may be waived by the Pension Committee
in appropriate cases.
(d) Decision on Review.
(i) A decision shall be rendered by the Pension Committee
within 60 days after the receipt of the request for
review, provided that where special circumstances
require an extension of time for processing the
decision, it may be postponed on written notice to
the Claimant (prior to the expiration of the initial
60 day period), for an additional 60 days, but in no
event shall the decision be rendered more than 120
days after the receipt of such request for review.
(ii) Notwithstanding subparagraph (i), if the Pension
Committee specifies a regularly scheduled time at
least quarterly to review such appeals, a Claimant's
request for review will be acted upon at the
specified time immediately following the receipt of
the Claimant's request unless such request is filed
within 30 days
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preceding such time. In such instance, the decision
shall be made no later than the date of the second
specified tune following the Pension Committee's
receipt of such request. If special circumstances
(such as a need to hold a hearing) require a further
extension of time for processing a request, a
decision shall be rendered not later than the third
specified time of the Pension Committee following the
receipt of such request for review and written notice
of the extension shall be furnished to the Claimant
prior to the commencement of the extension.
(iii) Any decision by the Pension Committee shall be
furnished to the Claimant in writing and in a manner
calculated to be understood by the Claimant and shall
set forth the specific reason(s) for the decision and
the specific Plan provision(s) on which the decision
is based.
8.5 Records and Reports. The Pension Committee shall exercise such
authority and responsibility as it deems appropriate in order to comply
with ERISA and governmental regulations issued thereunder relating to
records of Participants' account balances and the percentage of such
account balances which are nonforfeitable under the Plan; notifications
to Participants; and annual reports and registration with the Internal
Revenue Service.
8.6 Other Powers and Duties. The Pension Committee shall have such duties
and powers as may be necessary to discharge its duties hereunder,
including, but not by way of limitation, the following:
(a) discretion to construe and interpret the Plan, decide all
questions of eligibility and determine the amount, manner and
time of payment of any benefits hereunder;
(b) to prescribe procedures to be followed by Participants, Former
Participants or Beneficiaries filing applications for
benefits;
(c) to prepare and distribute information explaining the Plan;
(d) to receive from the Employer and from Participants, Former
Participants and Beneficiaries such information as shall be
necessary for the proper administration of the Plan;
(e) to furnish the Employer, upon request, such annual reports
with respect to the administration of the Plan as are
reasonable and appropriate;
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(f) to receive, review and keep on file (as it deems convenient or
proper) reports of the financial condition, and of the
receipts and disbursements, of the Trust Fund from the
Trustees;
(g) to appoint or employ advisors including legal and actuarial
counsel to render advice with regard to any responsibility of
the Pension Committee under the Plan or to assist in the
administration of the Plan; and
(h) to determine the status of qualified domestic relations orders
under Section 414(p) of the Code.
The Pension Committee shall have no power to add to, subtract from or
modify any of the terms of the Plan, or to change or add to any
benefits provided by the Plan, or to waive or fail to apply any
requirements of eligibility for a benefit under the Plan.
8.7 Rules and Decisions. The Pension Committee may adopt such rules as it
deems necessary, desirable, or appropriate. All rules and decisions of
the Pension Committee shall be applied uniformly and consistently to
all Participants in similar circumstances. When making a determination
or calculation, the Pension Committee shall be entitled to rely upon
information furnished by a Participant, Former Participant or
Beneficiary, the Employer, the legal counsel of the Employer or the
Trustee.
8.8 Authorization of Benefit Payments. The Pension Committee shall issue
proper directions to the Trustee concerning all benefits which are to
be paid from the Trust Fund pursuant to the provisions of the Plan.
8.9 Application and Forms for Benefits. The Pension Committee may require a
Participant, Former Participant or Beneficiary to complete and file
with it an application for a benefit, and to furnish all pertinent
information requested by it. The Pension Committee may rely upon all
such information so furnished to it, including the Participant's,
Former Participant's or Beneficiaries current mailing address.
8.10 Facility of Payment. Whenever, in the Pension Committee's opinion, a
person entitled to receive any payment of a benefit or installment
thereof hereunder is under a legal disability or is incapacitated in
any way so as to be unable to manage his financial affairs, the Pension
Committee may direct the Trustee to make payments to such person or to
his legal representative or to a relative or friend of such person for
his benefit, or the Pension Committee may direct the Trustee to apply
the payment for the benefit of such person in such manner as it
considers advisable, which shall be a complete discharge of any
liability of the Plan to the Participant or Beneficiary.
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8.11 Indemnification. The Employer shall indemnity each individual who is an
officer, director or Employee of the Employer and who may be called
upon or designated to perform fiduciary duties or to exercise fiduciary
authority or responsibility with respect to the Plan and shall save and
hold him harmless from any and all claims, damages, and other
liabilities, including without limitation all expenses (including
attorneys' fees and costs), judgments, fines and amounts paid in
settlement and actually and reasonably incurred by him in connection
with any action, suit or proceeding, resulting from his alleged or
actual breach of such duties, authority or responsibility, whether by
negligence, gross negligence or misconduct, to the maximum extent
permitted by law, provided, however, that this indemnification shall
not apply with respect to any actual breach of such duties, authority
or responsibility, if the individual concerned did not act in good
faith and in the manner he reasonably believed to be in (or not opposed
to) the best interest of the Employer, or, with respect to any criminal
action or proceeding, had reasonable cause to believe his conduct was
unlawful.
8.12 Resignation or Removal of the Pension Committee. A Pension Committee
member may resign at any time by giving ten days' written notice to the
Employer and the Trustee. The Board of Directors may remove any member
of the Pension Committee by giving written notice to him and the
Trustee. Any such resignation or removal shall take effect at a date
specified on such notice, or upon delivery to the Pension Committee if
no date is specified.
8.13 Notices and Forms. The Pension Committee, at its discretion may
establish procedures for the submission to the Pension Committee by the
Participants of the elections, designations and applications required
of Participants, Former Participants and Beneficiaries by the Plan.
With reasonable notice to the Participants, Former Participants and
Beneficiaries, as appropriate, the Pension Committee may establish
procedures for the submission of written elections, designations and
applications, including applications, for a loan, withdrawal or
distribution, or may provide that any of such elections, designations
and applications may be made by an interactive voice response system.
The Pension Committee, at its discretion, may also direct that the
Participant, Former Participant or Beneficiary shall direct any
election, designation or application to the recordkeeper for the Plan
named from time to time by the Pension Committee.
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ARTICLE IX
MISCELLANEOUS
9.1 No Guarantee of Employment. Nothing contained in this Plan shall be
construed as a contract of employment between the Employer and any
Eligible Employee, or as a right of any Eligible Employee to be
continued in the employment of the Employer, or as a limitation of the
right of the Employer to discharge any of its Eligible Employees, with
or without cause.
9.2 Rights to Trust Assets. No Eligible Employee or Beneficiary shall have
any right to, or interest in, any assets of the Trust Fund upon
Termination of his employment or otherwise, except as provided from
time to time under this Plan, and then only to the extent of the
benefits payable under the Plan to such Eligible Employee out of the
assets of the Trust Fund. All payments of benefits as provided for in
this Plan shall be made solely out of the assets of the Trust Fund.
9.3 No Alienation of Benefits. Except as may be permitted by law, and
except as may be required or permitted by a qualified domestic
relations order as defined in Section 414(p) of the Code, benefits
payable under this Plan shall not be subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance, charge, garnishment, execution, or levy of any kind,
either voluntary or involuntary, including any such liability which is
for alimony or other payments for the support of a spouse or former
spouse, or for any other relative of the Eligible Employee, prior to
actually being received by the person entitled to the benefit under the
terms of the Plan; and any attempt to anticipate, alienate, sell,
transfer, assign, pledge, encumber, charge or otherwise dispose of any
right to benefits payable hereunder shall be void. The Trust Fund shall
not in any manner be liable for, or subject to, the debts, contracts,
liabilities, engagements or torts of any person entitled to benefits
hereunder.
Benefits payable to an alternate payee pursuant to a qualified domestic
relations order under Section 414(p) of the Code shall be paid
immediately in a lump sum, except that if the benefit payable to the
alternate payee exceeds $3,500, the benefit shall not be distributed
immediately without the alternate payee's consent.
9.4 Discontinuance of Employer Contributions. In the event of permanent
discontinuance of contributions to the Plan by the Employer, the
accounts of all Participants shall become fully-vested and
nonforfeitable as of the date of such discontinuance.
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ARTICLE X
AMENDMENTS AND ACTION BY COMPANY
10.1 Amendments Generally. The Board of Directors reserves the right to make
from time to time any amendment or amendments to this Plan or Trust
which do not cause any part of the Trust Fund to be used for, or
diverted to, any purpose other than the exclusive benefit of
Participants, Former Participants or their Beneficiaries; provided,
however, that the Company may make any amendment it determines
necessary or desirable, with or without retroactive effect, to comply
with the Code and ERISA. The Board of Directors shall exercise its
right to amend the Plan or Trust by the adoption of a resolution of the
Board of Directors approving an amendment of the Plan or by authorizing
an appropriate executive officer of the Company to execute amendments
to the Plan on behalf of the Company.
No amendment to the Plan shall decrease a Participant's Accounts or
eliminate an optional form of distribution except as may be permitted
by the Code or ERISA. No amendment to the Plan shall discriminate in
favor of the Highly Compensated Eligible Participants.
10.2 Amendments to Vesting Schedule. Any amendment to the Plan which alters
the vesting schedule set forth in Section 6.4 shall be deemed to
include the following terms:
(a) The vested percentage of a Participant in that portion of his
HMI Company Regular Account or Raff-Hughes Company Regular
Account under the Plan derived from Employer contributions
made for Plan Years ending with or within the later of the
date such amendment is adopted or the date such amendment
becomes effective shall not be reduced; and
(b) Effective January 1, 1989 with respect to Merged Plan II and
otherwise effective January 1, 1991, each Participant having
not less than three Years of Service at the later of the date
such amendment was effective shall be permitted to elect
irrevocably to have his vested percentage computed under the
Plan without regard to such amendment. Such election must be
made within 60 days from the later of (i) the date the
amendment was adopted, (ii) the date the amendment became
effective, or (iii) the date the Participant is issued written
notice of such amendment by the Pension Committee.
Notwithstanding the preceding sentence, no election need be provided
for any Participant whose nonforfeitable percentage in his HMI Company
Regular Account under the Plan, as amended at any time, cannot be less
than such percentage determined without regard to such amendment.
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10.3 Action by Company. Any action by the Company under this Plan shall be
by a duly adopted resolution of its Board of Directors, or by any
person or persons duly authorized by a duly adopted resolution of that
Board to take such action.
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ARTICLE XI
SUCCESSOR EMPLOYER AND MERGER OR
CONSOLIDATION OF PLANS
11.1 Successor Employer. In the event of the dissolution, merger,
consolidation or reorganization of the Employer, provision may be made
by which the Plan and Trust will be continued by the successor; and, in
that event, such successor shall be substituted for the Employer under
the Plan. The substitution of the successor shall constitute an
assumption of Plan liabilities by the successor, and the successor
shall have all of the powers, duties and responsibilities of the
Employer under the Plan.
11.2 Plan Assets. There shall be no merger or consolidation of the Plan
with, or transfer of assets or liabilities of the Trust Fund to, any
other plan of deferred compensation maintained or to be established for
the benefit of all or some of the Participants of the Plan, unless each
Participant would (if either this Plan or the other 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,
consolidation or transfer (if this Plan had then terminated), and
unless a duly adopted resolution of the Board of Directors authorizes
such merger, consolidation or transfer of assets.
11.3 Merged Plans. If the Pension Committee or the Internal Revenue Service
determines that a Merged Plan is not qualified under Section 401(a) of
the Code, the assets attributable to the Merged Plan shall be
distributed from the Trust as the Pension Committee deems necessary to
preserve or restore the qualified status of this Plan.
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ARTICLE XII
PLAN TERMINATION
12.1 Right to Terminate. In accordance with the procedures set forth herein,
the Board of Directors may terminate the Plan at any time in whole or
in part. To the extent permitted by the Code and regulations
thereunder, in the event of the dissolution, merger, consolidation or
reorganization of the Company, the Plan shall terminate and the Trust
Fund shall be liquidated unless the Plan is continued by a successor to
the Company in accordance with Section 11.1.
12.2 Liquidation of the Trust Fund. Upon the complete or partial termination
of the Plan, the Accounts of all Participants affected thereby shall
become fully-vested and nonforfeitable, to the extent funded, and the
Pension Committee shall direct the Trustee to distribute the assets
remaining in the Trust Fund, after payment of any expenses properly
chargeable thereto, to Participants, Former Participants and
Beneficiaries in proportion to their respective account balances. If
any amounts attributable to Forfeitures shall still remain, such
amounts shall be returned to the Employer.
12.3 Manner of Distribution. To the extent that no discrimination in value
results, any distribution after termination of the Plan may be made, in
whole or in part, in cash, or in securities or other assets in kind, as
the Pension Committee may determine. All non-cash distributions shall
be valued at fair market value at date of distribution.
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ARTICLE XIII
DETERMINATION OF TOP-HEAVY STATUS
13.1 General. Notwithstanding any other provision of the Plan to the
contrary, for any Plan Year in which the Plan is a Top-Heavy Plan or
Super Top-Heavy Plan, as defined below, the provisions of this Article
shall apply, but only to the extent required by Section 416 of the Code
and the regulations thereunder.
13.2 Top-Heavy Plan. This Plan shall be Top-Heavy and an Aggregation Group
shall be a Top-Heavy Group if as of the Determination Date for such
Plan Year the sum of the Cumulative Accrued Benefits and Cumulative
Accounts of Key Eligible Employees for the Plan Year exceeds 60% of the
aggregate of all the Cumulative Accounts and Cumulative Accrued
Benefits.
(a) If the Plan is not included in a Required Aggregation Group
with other plans, then it shall be Top-Heavy only if (i) when
considered by itself it is a Top-Heavy Plan and (ii) it is not
included in a Permissive Aggregation Group that is not a
Top-Heavy Group.
(b) If the Plan is included in a Required Aggregation Group with
other plans, it shall be Top-Heavy only if the Required
Aggregation Group, including any permissively aggregated
plans, is Top-Heavy.
13.3 Super Top-Heavy Plan. This Plan shall be a Super Top-Heavy Plan if it
would be a Top-Heavy Plan under Section 13.2, but substituting 90% for
60%.
13.4 Cumulative Accrued Benefits and Cumulative Accounts. The determination
of the Cumulative Accrued Benefits and Cumulative Accounts under the
Plan shall be made in accordance with Section 416 of the Code and the
regulations thereunder. The determination of the Plan's Top-Heavy,
status shall relate to the proper Determination Date and Valuation
Date.
13.5 Definitions.
(a) "Aggregation Group" means either a Required Aggregation Group
or a Permissive Aggregation Group.
(b) "Determination Date" means with respect to any Plan Year, the
last day of the preceding Plan Year or in the case of the
first Plan Year of any plan, the last day of such Plan Year or
such other date as permitted by the Secretary of the Treasury
or his delegate.
(c) "Corporation" means the Employer that adopts this Plan and all
members of a controlled group of corporations (as defined in
Section 414(b) of the Code), all commonly controlled trades or
businesses (as defined in Section
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414(c) of the Code) or affiliated service groups (as defined
in Section 414(m) of the Code) of which the Employer is a
part.
(d) "Key Eligible Employee" means those individuals described in
Section 416(i)(1) of the Code and the regulations hereunder.
(e) "Non-Key Eligible Employee" means those individuals who are
not Key Eligible Employees and includes former Key Eligible
Employees.
(f) "Permissive Aggregation Group" means a Required Aggregation
Group plus any other plans selected by the Company provided
that all such plans when considered together satisfy the
requirements of Sections 401(a)(4) and 410(b) of the Code.
(g) "Required Aggregation Group" means a plan maintained by the
Employer in which a Key Eligible Employee is a participant or
which enables any plan in which a Key Eligible Employee is a
participant to meet the requirements of Section 401(a)(4) or
Section 410(b) of the Code (including any terminated plan
which terminated within five years of the Determination Date).
(h) "Valuation Date" means the first day of each Plan Year.
13.6 Vesting. For each Plan Year in which the Plan is Top-Heavy or Super
Top-Heavy, a Participant who is credited with one Hour of Service in
any Plan Year in which the Plan is Top-Heavy or Super Top-Heavy shall
have a nonforfeitable interest in that portion of his HMI Company
Regular Account and Raff-Hughes Company Regular Account in accordance
with Section 6.4.
13.7 Compensation. Compensation means compensation as defined in Section
414(q)(7) of the Code, not in excess of $200,000 (such amount to be
adjusted annually for increases in the cost of living in accordance
with Section 415(d) of the Code). Effective January 1, 1989,
Compensation shall be limited in accordance with Section 401(a)(17) of
the Code.
13.8 Minimum Contributions. For each Plan Year in which the Plan is
Top-Heavy or Super Top-Heavy, minimum Employer contributions for a
Participant who is a Non-Key Eligible Employee shall be required to be
made on behalf of each Participant who is employed by the Employer on
the last day of the Plan Year, regardless of the level of his
Compensation and regardless of the number of Hours of Service he has
completed during such Plan Year. The amount of the minimum contribution
shall be the lesser of the following percentages of compensation (as
defined in Section 415(c)(3) of the Code):
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(i) Three percent, or
(ii) The highest percentage at which Employer
Contributions are made under the Plan for the Plan
Year on behalf of any Key Eligible Employee.
(A) For purposes of subparagraph (ii), all defined
contribution plans included in a Required Aggregation
Group shall be treated as one plan.
(B) This paragraph (ii) shall not apply if the Plan
is included in a Required Aggregation Group and the
Plan enables a defined benefit plan included in the
Required Aggregation Group to meet the requirements
of Section 401(a)(4) or 410(b) of the Code.
In determining whether a Non-Key Eligible Employee has
received any required minimum contribution, the contributions
allocated to such Non-Key Eligible Employee made pursuant to
Section 4.1(a) or (b) shall not be considered minimum
contributions.
This Section shall not apply to the extent a Participant other
than a Key Eligible Employee is covered by another qualified
plan(s) of the Corporation and the Corporation has provided
that the minimum contribution requirements applicable to this
Plan will be satisfied by the other plan(s).
13.9 Defined Benefit and Defined Contribution Plan Fractions. For any Plan
Year in which the Plan is Super Top-Heavy, or for any Plan Year in
which the Plan is Top-Heavy and the additional minimum contributions or
benefits required under Section 416(h) of the Code are not provided,
the dollar limitations in the denominator of the defined benefit plan
fraction and defined contribution plan fraction as defined in Section
415(e) of the Code shall be adjusted as set forth in Section 416(h) of
the Code. If the application of the provisions of this Section 13.9
would cause any Participant to exceed 1.0 for any Limitation Year, then
the application of this Section 13.9 shall be suspended as to such
Participant until such time as he no longer exceeds 1.0. During the
period of such suspension, there shall be no Corporation contributions,
Forfeitures or voluntary nondeductible contributions allocated to such
Participant under this Plan or under any other defined contribution
plan of the Corporation and there shall be no benefit accruals for such
Participant under any defined benefit plan of the Corporation.
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IN WITNESS WHEREOF, the Company has executed this restated Plan this
14th day of November, 1994.
ACORDIA, INC.
By:______________________________
L. Ben Lytle
Chief Executive Officer
Attest:
__________________________
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APPENDIX A
ACORDIA 401(k) LONG TERM SAVINGS INVESTMENT PLAN
Matching
Contribution
Percentage If
Other Than 50% Acordia
Participating Affiliates as of 12/31/94 On First 6% Employer
- ---------------------------------------------- ------------------ -----------
Acordia, Inc.
Acordia Benefits of Florida, Inc.
Acordia Benefits of Northern California, Inc.
Acordia of Southern California, Inc.
Acordia of The South, Inc.
Acordia Benefits of Texas, Inc.
Acordia of Evansville, Inc.
Acordia Collegiate Benefits, Inc.
Acordia Educational Benefits of Texas, Inc.
Acordia Health Industry Services, Inc.
Acordia Local Government Services, Inc.
Acordia of Cleveland, Inc.
Acordia of Central Indiana, Inc.
Acordia of Louisville, Inc.
Acordia Personal Benefits, Inc.
Acordia Personal Benefits of Utah, Inc. 0%
Acordia School Benefits, Inc.
Acordia Senior Benefits, Inc.
Acordia Small Business Benefits, Inc.
Acordia Small Business Benefits of the Southwest, Inc.
Business Insurance Resources, Inc.
Acordia of Northeast Indiana, Inc.
Acordia of Lexington, Inc.
Acordia of North Carolina, Inc.
Acordia of Central Pennsylvania, Inc.
Acordia of Colorado, Inc.
Acordia of Phoenix, Inc.
Acordia of Mississippi, Inc.
Acordia of South Florida, Inc.
Preslan Agency, Inc.
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EXHIBIT A
ACORDIA 401(k) LONG TERM SAVINGS INVESTMENT PLAN
Merged Plan: HMI Employees' Profit Sharing Plan
Special Payment Options:
A Participant may elect one of the following options for payment of that portion
of his HMI Account attributable to participation under Merged Plan II, and
income allocated thereto ("Merged HMI Account"):
(i) A lump sum;
(ii) Substantially equal periodic installments payable over the lifetime of the
Participant or over the joint lifetimes of the Participant and his
Beneficiary; or
(iii) Purchase of an annuity.
The following provisions shall apply only if a Participant elects option (iii),
"purchase of an annuity".
(a) Unless a Participant elects otherwise with the consent of his Spouse, if
applicable, to have his benefits paid in other than a qualified joint and
50% survivor annuity, the Participant shall be deemed to have elected to
receive that portion of his benefits under the Plan in (i) a single life
annuity if the Participant is not married on the Annuity Starting Date;
and (ii) a qualified joint and 50% survivor annuity if the Participant is
married on the Annuity Starting Date. The Employer shall purchase the
applicable annuity with that portion of the Participant's vested Merged
HMI Account balance.
In order for the Spouse to be eligible for the survivor annuity, the
Participant or Former Participant must have:
(1) Terminated his employment with the Employer at any time and not have
died before his Annuity Starting Date,
(2) The Participant or Former Participant must not have waived such
qualified joint and survivor annuity and elected an optional form of
payment pursuant to paragraph (c) within the 90 day period ending on
the Annuity Starting Date and obtained the consent of his Spouse to
such waiver pursuant to paragraph (c), and
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(3) The Participant or Former Participant must be married on his Annuity
Starting Date.
(b) Notice and Election or Revocation of Survivor Annuity. The Pension
Committee shall furnish each Participant or Former Participant with the
following information regarding benefits payable under the Plan in written
nontechnical language not less than 30 and not more than 90 days prior to
the Annuity Starting Date including:
(1) A general description or explanation of the terms and conditions of
the qualified joint and survivor annuity benefit and notification of
the Participant's or Former Participant's right to waive the right
to receive his retirement benefits in a qualified joint and survivor
annuity and to elect another form of payment and the right to make
or to revoke a previous election to waive the qualified joint and
survivor annuity;
(2) A general explanation of the rights of a Participant's or Former
Participant's Spouse.
A Participant or Former Participant may elect to waive the single life
annuity or qualified joint and survivor annuity, as applicable, and to
receive such benefits in any other annuity form permitted by the Plan by
giving written notification to the Pension Committee during the election
period of his intent to receive his benefits in such other form. Such
election period shall be the 90 day period ending on the Annuity Starting
Date.
Any election to waive the qualified joint and survivor annuity shall not
take effect unless the Spouse of the Participant or Former Participant
consents irrevocably in writing to such election and the Spouse's consent
acknowledges the effect of such election, including the spouse's voluntary
election to waive the right to consent to the designation of a specific
Beneficiary and the alternate form of payment and is witnessed by a notary
public. Any consent necessary under this provision will be valid only with
respect to the Spouse who signs the consent, or in the event of a deemed
qualified election, the designated Spouse and must be limited to a benefit
for a specific alternate Beneficiary. Any new waiver will require a new
spousal consent. The requirements of this paragraph may be waived if it is
established to the satisfaction of the Pension Committee that the consent
may not be obtained because there is no Spouse or because the Spouse
cannot be located or because of such other circumstances as may be
prescribed by regulation in which case a waiver will be deemed a qualified
election.
Any election made under this Section may be revoked by the Participant or
Former Participant during the specified election period. Such revocation
shall be effected by written notification to the Pension Committee.
Following such revocation, another election under this Section may be made
at any time during the specified election period. A revocation of a prior
waiver may be made at any
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time by a Participant or Former Participant without the consent of the
Spouse before the commencement of benefits.
Any actual or constructive election under this paragraph (b) having the
effect of providing a Spouse's benefit automatically shall be revoked if
the electing person ceases to have a Spouse during the election period,
except to the extent required under a qualified domestic relations order.
However, if the electing person subsequently remarries, the election will
automatically be reinstated at that time, but will be treated as a new
election.
(c) Qualified Preretirement Survivor Annuity. The surviving Spouse of a
Participant who meets the requirements of this Section shall be entitled
to a qualified preretirement survivor annuity payable if the Participant
has elected an annuity form of payment and dies before his Annuity
Starting Date. The preretirement survivor annuity will be a survivor
annuity for the life of the surviving Spouse of the Participant, that can
be purchased with the vested Merged HMI Account balance as of the date of
death.
If so elected by the surviving Spouse, the preretirement survivor annuity
shall be payable as soon as administratively feasible following the
Participant's death. If the surviving Spouse does not make the election
referred to in the preceding sentence, payment of the preretirement
survivor annuity shall not commence until the Participant would have
attained Normal Retirement Date.
In order for such Spouse's benefit to be payable, the Participant must
have satisfied the conditions set forth in (1), (2), (3) and (4) below.
(1) The Participant must have died before his Annuity Starting Date, but
after having elected an annuity form of payment.
(2) The Participant must be married on the date of the Participant's
death.
(3) The Participant must not have designated an alternate Beneficiary in
the manner described in paragraph (e) to receive any death benefits
payable upon his death and otherwise payable to the Spouse in a
preretirement survivor annuity in an alternate form of payment
described in paragraph (f). Notwithstanding the foregoing, such
consent shall have no effect with respect to the survivor benefits
payable under paragraph (a), to the surviving Spouse of a
Participant who dies after his Annuity Starting Date, unless the
spouse has consented to a waiver of the qualified joint and survivor
annuity pursuant to paragraph (b).
(4) The Participant must not have designated his Spouse as his
Beneficiary in the manner described in paragraph (e) to receive any
benefits payable upon his death and otherwise payable to the Spouse
in a preretirement survivor
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annuity, in an alternate form of payment described in paragraph (f).
Notwithstanding the foregoing, such consent shall have no effect
with respect to the survivor benefits payable under paragraph (a) to
the surviving Spouse of a Participant who dies after his Annuity
Starting Date, unless the Spouse has consented to a waiver of the
qualified joint and survivor annuity pursuant to paragraph (b).
(d) Information to Participants. The Pension Committee shall provide a
Participant with information with respect to the preretirement survivor
annuity which information shall be provided in a manner similar to the
information with respect to the qualified joint and survivor annuity and
in a manner which will reasonably assure that it will be received within
the "applicable time period". For purposes of this paragraph, the term
"applicable time period" means, with respect to a Participant, whichever
of the following periods ends last:
(1) The period beginning with the first day of the Plan Year in which
the Participant attains age 32 and ending with the close of the Plan
Year preceding the Plan Year in which the Participant attains age
35;
(2) A reasonable period after the individual becomes a Participant. For
this purpose, in the case of an individual who becomes a Participant
after age 35, the explanation must be provided by the end of the
one-year period beginning with the first day of the first Plan Year
for which the individual is a Participant; or
(3) A reasonable period after separation from service in the case of a
Participant who separates before attaining age 35. For this purpose,
the Pension Committee must provide the explanation beginning one
year before the separation from service and ending one year after
separation.
(e) Election to Waive Preretirement Survivor Annuity. A Participant who is
entitled to have his Spouse receive benefits in the form described in
paragraph (c) may waive the qualified preretirement survivor annuity and
may (i) designate an alternate Beneficiary to receive such benefits in any
other form permitted under paragraph (f) by designating an alternate
Beneficiary during the election period, or (ii) designate his spouse as
his Beneficiary to receive such benefits in any form permitted under
paragraph (f) by designating an alternate form of payment other than the
qualified preretirement survivor annuity during the election period, in
each case in the manner described in this subsection.
The election period to waive the preretirement survivor annuity shall be
the period which begins on the first day of the Plan Year in which the
Participant attains age 35 and ends on the earlier of the date of the
Participant's death or the Annuity Starting Date. In the case of a
Participant who is separated from service, the
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applicable election period with respect to benefits accrued before the
date of such separation from service shall not begin later than such date.
Notwithstanding the foregoing, the election period to waive the
preretirement survivor annuity shall not begin earlier than the date on
which the preretirement survivor annuity first would apply to a
Participant.
Any election to waive the preretirement survivor annuity shall not take
effect unless the Spouse of the Participant consents irrevocably in
writing to such election and the Spouse's consent acknowledges the effect
of such election including the Spouse's voluntary election to waive the
right to consent to the designation of a specific alternate Beneficiary
and the alternate form of payment and the Spouse's consent is witnessed by
a notary public or a representative designated by the Pension Committee.
Any consent necessary under this provision will be valid only with respect
to the spouse who signs the consent, or in the event of a deemed qualified
election, the designated Beneficiary and must be limited to a benefit for
a specific alternate Beneficiary. Any new waiver will require a new
spousal consent. The requirements of this paragraph may be waived if it is
established to the satisfaction of the representative designated by the
Pension Committee that the consent may not be obtained because there is no
Spouse or because the spouse cannot be located or because of such other
circumstances as may be prescribed by regulation in which case a waiver
will be deemed a qualified election.
Any election to waive the preretirement survivor annuity made under this
Section may be revoked by the Participant during the specified election
period. Such revocation shall be effected by written notification to the
representative designated by the Pension Committee. Following such
revocation, another waiver under this Section may be made at any time
during the specified election period. A revocation of a prior waiver may
be made at any time by a Participant without the consent of the Spouse
before the Annuity Staring Date. Any actual or constructive election under
this paragraph having the effect of providing a Spouse's benefit
automatically shall be revoked if the electing Participant ceases to have
a Spouse during the election period, except to the extent required under a
qualified domestic relations order. However, if the electing person
subsequently remarries, the election automatically will be reinstated at
that time but will be treated as a new election.
(f) Optional Form of Benefit Payments Upon Death. Subject to the requirements
of paragraph (e), if (i) the Participant has designated an alternate
Beneficiary to receive any benefits payable on account of his death prior
to his Annuity Starting Date pursuant to paragraph (e) which are otherwise
payable to the Spouse in a preretirement survivor annuity, or (ii) the
Participant has designated his surviving Spouse as his Beneficiary to
receive any benefits payable on account of his death prior to his Annuity
Starting Date which are otherwise payable to the Spouse in
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a preretirement survivor annuity, in the alternate form permitted under
this paragraph (f) pursuant to paragraph (e), any amount to which a
Beneficiary is entitled shall be distributed in accordance with Section
6.7.
Notwithstanding the foregoing, if the qualified preretirement survivor
annuity has not been waived by the Participant in accordance with
paragraph (e), upon written notice to the representative designated by the
Pension Committee within the 90 day period ending on the date the
preretirement survivor annuity is due to commence, the Spouse may elect to
have any benefits to which he or she otherwise is entitled in the form of
a qualified preretirement survivor annuity (on account of the
Participant's death prior to commencement of benefits) distributed in a
lump sum. Any election to waive the preretirement surviving annuity made
under this Section may be revoked by the Spouse during the specified
election period. Such revocation shall be effected by written notification
to the representative designated by the Pension Committee. Following such
revocation, another waiver under this Section may be made at any time
during the specified 90 day election period.
(g) Special Rule for Small Annuities. The present value of any annuity
provided by the Plan shall be immediately distributed to the Participant,
Former Participant or Beneficiary if the Participant's or Former
Participant's vested Merged HMI Account balance does not exceed $3,500.
No distribution may be made pursuant to this paragraph (g) after benefits
have commenced to be paid to the Participant or Former Participant or the
surviving Spouse where the Participant or Former Participant has died.
(h) Nontransferability of Annuities. Any annuity contract distributed herefrom
shall be nontransferable.
(i) Annuity Starting Date. Annuity Starting Date means the first day of the
first period for which an annuity is payable as an annuity. In the case of
a benefit not payable as an annuity, Annuity Starting Date means the first
day on which all conditions have been met which entitle the Participant or
Former Participant to such benefit.
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EXHIBIT B
ACORDIA 401(k) LONG TERM SAVINGS INVESTMENT PLAN
Merged Plan: Price & MacDonald, Inc. Profit Sharing Plan (PriMac Plan).
Merger Date: May 31, 1993. PriMac shall become an Employer in the Plan on that
date.
Participation: All participants in the PriMac Plan on the Merger Date shall
become Participants in the Plan, and if the individual is an Eligible Employee
on the Merger Date, he shall be eligible to make Before Tax Contributions in
accordance with the Plan.
Accounts: The accounts maintained under the PriMac Plan shall be held in the
similar Accounts under the Plan and shall be subject to the provisions of the
Plan. A Company Contribution Account shall be established for any PriMac Plan
participant who was credited with Company contributions (discretionary
contributions under the PriMac Plan).
Vesting: A PriMac participant's interest in his accounts shall become fully
vested and nonforfeitable upon the Merger Date.
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84
EXHIBIT C
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ACORDIA
401(k) LONG TERM SAVINGS INVESTMENT PLAN
PARTICIPANT LOAN PROVISIONS
Effective October 21, 1992, the Acordia Pension Benefits Administration and
Compliance Committee (the "Committee"), for the Acordia 401(k) Long Term Savings
Investment Plan (the "Plan"), adopted the following program for loans under the
Plan, which shall thereafter form part of the Plan document.
1. Administration of the Participant loan program
The loan program under the Plan is administered by the Pension Benefits
Administration and Compliance Committee. The Committee has delegated to
the Benefits Administrator and Recordkeeper the authority to approve loans
to Participants in accordance with the terms of the Plan, including this
document, which forms a part of the Plan.
All applications for loans under the Plan shall be filed with the
Recordkeeper at the following address:
Wyatt Preferred Choice
Attn: Acordia 401 (k) Long Term Savings
Investment Plan
6483 City West Parkway
Eden Prairie, MN 55344-7835
2. Eligibility for Participant Loans
All Participants who are actively employed by the Company are eligible for
Plan loans without regard to race, color, religion, sex, age or national
origin. Effective 1/1/96, a Participant may not obtain a loan if he
already has two outstanding loans under the plan. Prior to 1/1/96, a
Participant could not obtain a loan if he (f) already had an outstanding
loan under the Plan or (ii) had completely prepaid an existing loan within
the three-month period immediately preceding the application for a new
loan.
3. Term of Loans
The term of the loan can be for one, two, three, four or five years as
elected by the Participant. If the loan proceeds will be used to purchase
the Participant's primary residence, the loan term can be six, seven,
eight, nine or ten years.
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4. Repayment of Loans
A loan to a Participant must be repaid, in level installment payments of
principal and interest, by automatic payroll deduction beginning with his
paycheck no later than the second full payroll period following approval
of the loan. If the Participant subsequently is granted an unpaid leave of
absence or is transferred to a group or location which is not covered
under the Plan, no loan payments will be made. If a participant does not
make loan repayments and returns to normal pay status, the plan will
either:
(a) Extend the term of the loan by the number of payments for
which repayments were missed, to the extent permitted by law,
or
(b) immediately double repayments for as many pay periods as
repayments were missed.
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ACORDIA
401(k) LONG TERM SAVINGS INVESTMENT PLAN
(RESTATED EFFECTIVE OCTOBER 21, 1992)
88
FIRST AMENDMENT OF
ACORDIA 401(k) LONG TERM SAVINGS INVESTMENT PLAN
The Acordia 401(k) Long Term Savings Investment Plan (the "Plan") is
hereby amended as follows:
1. Effective January 1, 1996, Section 6.10 of the Plan is amended to
delete the second sentence in its entirety and replace it with the following:
The Participant may have up to two loans outstanding at any time.
2. Effective April 1, 1995, Paragraph 4.1(a)(i) of the Plan is
hereby amended to add the following language to the end of that Paragraph:
Notwithstanding the foregoing, in the case of a Participant who is
an employee of Bain Hogg Corporation who became eligible to
participate in the Plan as of April 1, 1995, limits referred to
above shall be doubled for a number of pay periods beginning on
April 1 equal to the number of pay periods between January 1, 1995
and March 31, 1995.
3. Effective September 1, 1995, Subsection 7.3(a) is amended to read
as follows:
7.3 Acordia Stock
(a) Limitation on Acordia Stock Investment.
Notwithstanding any other provisions of the Plan, the following
rules shall apply with respect to the investment of a Participant's
Accounts in Acordia Stock;
(1) As of the Effective Date, in accordance with rules
prescribed by the Pension Committee, a Participant may direct the
investment of up to 20% of the total amount in his Accounts as of
August 31, 1992 into Acordia Stock;
(2) The maximum amount of future contributions to a
Participant's Accounts that may be invested in Acordia Stock shall
be 20% (50% effective September 1, 1995); and
89
(3) The maximum amount of a Participant's Accounts that
may be reallocated to Acordia Stock shall be an amount, which when
added to amounts already invested in Acordia Stock, results in a no
more than 20% (50% effective September 1, 1995) of the total of a
Participant's accounts being invested in Acordia Stock.
4. Effective January 1, 1996, Subsection 6.10(b) of the Plan
shall be amended to revise the sixth sentence of that Section to read as
follows:
Loans may be prepaid in full at any time without penalty.
5. Effective January 1, 1995, new Sections 2.18A, 2.18B and 2.81
are added to the Plan to read as follows:
2.18A Early Retirement means, with respect to a Participant,
termination of the Participant's employment with the Employer
at or after the Participant's Early Retirement Date.
2.18B Early Retirement Date means, with respect to a
Participant, the date on which the Participant has both
attained age 55 and complete at least five years of Service.
2.81 Year of Service means a "Year of Service" as defined
under the terms of the Acordia, Inc. Pension Plan.
6. Effective January 1, 1996, the first paragraph of Section
2.17 of the Plan is amended and restated in its entirety to read as follows:
2.17 Compensation means for any Plan Year base salary,
commissions, overtime pay and cash bonuses actually received
by a Participant. Compensation shall also include cash
received from the Flexible Benefits program and the amount of
any elective deferrals the Participant has authorized the
Employer to make on his behalf under the plans maintained by
the Employer in accordance with Sections 125 and 401(k) of the
Code but shall exclude all other forms of compensation such as
imputed income, car allowances, non-qualified deferred
compensation, severance payments, payments under the directed
executive compensation program, income from the exercise of
qualified or non-qualified stock options, payments under the
Company's
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long-term incentive plan or similar items. Notwithstanding the
last sentence, in no event shall Compensation exceed the
limitations of Section 401(a)(17) of the Code (as adjusted).
IN WITNESS WHEREOF, the Company has executed this First Amendment
this 29th day of December, 1995.
ACORDIA, INC.
___________________ Daniel W.
Kendall
Chair, Acordia Pension Benefit
Administration and Compliance Committee
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APPENDIX A - PARTICIPATING EMPLOYERS
ACORDIA 401(k) LONG TERM SAVINGS INVESTMENT PLAN
12/31/95
1995 L1L2 1996 L1L2 NAME
ACAA CAAC ACORDIA, INC.
ACBA CBAC ACORDIA BENEFIT SERVICES OF NORTHERN CALIFORNIA INC.
ACCA CCAC ACORIDA OF SOUTHERN CALIFORNIA
ACCB CCBC AA & C
ACDA CDAC ACORDIA BENEFITS OF EVANSVILLE, INC.
ACDB CDBC ACORDIA OF EVANSVILLE (SE EES)
ACEA CEAC ACORDIA BENEFITS OF FLORIDA INC.
ACFA CFAC ACORDIA BENEFITS OF TEXAS, INC.
ACGA CGAC ACORDIA BENEFITS OF THE SOUTH, INC.
ACHA CHAC ACORDIA MANAGED CARE SOLUTIONS d/b/a ADMIN SOL
ACHB CHBC ACORDIA COLLEGIATE
ACIA CIAC ACORDIA BENEFITS OF LOUISVILLE
ACJA CJAC ACORDIA OF LEXINGTON
ACKA CKAC ACORDIA OF CENTRAL INDIANA
ACLA CLAC ACORDIA EDUCATIONAL BENEFITS OF TEXAS, INC.
ACLB CLBC ACORDIA RAUH (SE EES)
ACMA CMAC ACORDIA OF NORTHEAST INDIANA
ACMB CMBC ACORDIA OF WESTERN VIRGINIA (SE EES)
ACMC CMCC ACORDIA OF NORTHEAST INDIANA
ACMP CMPC ACORDIA OF YOUNGSTOWN (MOORE-PETERSON)
ACOA COAC ACORDIA BENEFITS OF OHIO INC. DBA ACORDIA OF OH
ACPA CPAC ACORDIA OF MISSISSIPPI
ACPT CPTC ACORDIA OF THE NORTHWEST-PETTIT-MORRY
ACPU CPUC LWP SERVICES INC.
ACPV CPVC PETTIT-MORRY OF CALIFORNIA
ACPW CPWC PETTIT-MORRY OF OREGON
ACPX CPXC PUGET SOUND UNDERWRITERS
ACQA CQAC ACORDIA PERSONAL BENEFITS INC.
ACSA CSAC ACORDIA OF NORTHWEST INDIANA
ACTA CTAC INSURANCE MANAGEMENT BUREAU (RISK GROUP INC.)
ACUA CUAC ACORDIA SENIOR BENEFITS INC.
ACUB CUBC ACORDIA SENIOR OF THE SOUTHEAST
ACVA CVAC ACORDIA TEXAS GULF COAST
ACWA CWAC ACORDIA SMALL BUSINESS BENEFITS, INC.
ACWC CWCC ACORDIA SMALL BUSINESS BENEFITS, INC.
ACXA CXAC ACORDIA OF ERIE
ACYA CYAC ACORDIA BENEFITS OF SOUTHERN FLORIDA
AC10 C10C THE PRESLAN AGENCY
AC15 C15C HOGG ROBINSON OF NEW YORK
AC16 C16C HOGG ROBINSON OF NEW ENGLAND
AC17 C17C HOGG ROBINSON OF NEW HAMPSHIRE
AC18 C18C HOGG ROBINSON CONSULTING GROUP
AC25 C25C HOGG ROBINSON OF MICHIGAN
AC26 C26C PENN GENERAL - MICHIGAN
AC27 C27C HOGG ROBINSON OF GEORGIA
AC28 C28C HOGG ROBINSON OF FLORIDA
AC30 C30C ACCORDIA OF UTAH
AC35 C35C PENN GENERAL - LUBBOCK
AC40 C40C ACORDIA OF COLORADO
AC45 C45C RHR UNDERWRITERS
AC50 C50C ACORDIA OF NORTH CAROLINA, INC.
AC55 C55C HOGG ROBINSON OF VIRGINIA
AC60 C60C ACORDIA OF ARIZONA
AC65 C65C HOGG ROBINSON OF OHIO
AC70 C70C ACORDIA OF CENTRAL PENNSYLVANIA, INC.
AC71 C71C HOGG ROBINSON OF PENNSYLVANIA
AC75 C75C PENN GENERAL - OTHER SOUTHWEST
AC80 C80C TEXAS PROFESSIONAL INSURANCE AGENCY
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SECOND AMENDMENT OF ACORDIA
401(k) LONG TERM SAVINGS INVESTMENT PLAN
The Accordia 401(k) Long Term Savings Investment Plan (the "Plan")
is hereby amended as follows:
1. Effective October 21, 1992, Section 2.17 is amended to read as
follows:
2.17 Compensation means, for any Plan Year, base salary,
commissions, overtime pay and cash bonuses actually received by a
Participant. Compensation shall also include cash received under the
Employer's flexible benefits program and the amount of any elective
deferrals the Participant has authorized the Employer to make on his
behalf under the plans maintained by the Employer in accordance with
Sections 125 and 401(k) of the Code but shall exclude all other
forms of compensation such as imputed income, car allowances,
non-qualified deferred compensation, severance payments, payments
under the directed executive compensation program and income from
the exercise of qualified or non-qualified stock options or similar
items.
In no event shall a Participant's Compensation considered under the
Plan for a Plan Year beginning before January 1, 1994 exceed
$200,000, as adjusted to reflect increases pursuant to Section
401(a)(17) of the Code. In no event shall a Participant's
Compensation considered under the Plan for a Plan Year beginning
after December 31, 1993 exceed $150,000, as adjusted to reflect
increases pursuant to Section 401(a)(17) of the Code. In determining
a Participant's Compensation, the rules of Section 414(q)(6) of the
code shall apply, except that in applying those rules, the term
"family" shall include only the Participant's Spouse and lineal
descendants who have not attained age 19 before the close of the
Plan Year. If as a result of the application of the rules of Section
414(q)(6) the adjusted $200,000 or $150,000 limitation is exceeded,
the limitation shall be prorated among the affected individuals in
proportion to each individual's Compensation as determined under
this Section prior to the application of the limitation.
For purposes of Section 4.1 and 4.2, notwithstanding any provision
of this Plan to the contrary, for purposes of determining Before Tax
Contributions and Employer Matched Contributions for a Participant,
Compensation shall include such Participant's Compensation during
each pay period beginning with the Entry Date coincident with or
next following participation in the Plan pursuant to Section 3.2; or
if the
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individual elects to authorize Before Tax Contributions to the Plan
pursuant to Section 3.2; or if the individual elects to authorize
Before Tax Contributions to the Plan at a later date, the
Participant's Compensation during each pay period beginning with the
pay period with respect to which such election is first effective.
For purposes of Section 4.6 and 4.8, Compensation shall mean, with
respect to any determination period, a definition of Compensation
selected by the Pension Committee in accordance with, and from among
alternatives permissible under, Treas. Reg. 1.414(s)-1T (for years
prior to September 19, 1991) and 1.414(s)-1 or any successor
thereto. Any definition of Compensation selected by the Pension
Committee for use in satisfying the requirements of Section 4.6 or
4.8 for a determination period shall be used consistently to define
the Compensation of all Employees to be taken into account in
satisfying those requirements for that determination period.
2. Effective January 1, 1996, the first paragraph of Section 2.17 of
the Plan is amended to read as follows:
2.17 Compensation means, for any Plan Year, base salary,
commissions, overtime pay and cash bonuses actually received by a
Participant. Compensation shall also include cash received from the
Flexible Benefits program and the amount of any elective deferrals
the Participant has authorized the Employer to make on his behalf
under the plans maintained by the Employer in accordance with
Section 125 and 401(k) of the Code but shall exclude all other forms
of compensation such as imputed income, car allowances,
non-qualified deferred compensation, severance payments, payments
under the directed executive compensation program, income for the
exercise of qualified or non-qualified stock options, payments under
the Company's long-term incentive plan or similar items.
Notwithstanding the last sentence, in no event shall Compensation
exceed $150,000, as adjusted to reflect increases pursuant to
Section 401(a)(17) of the Code. In determining a Participant's
Compensation, the rules of Section 414(q)(6) of the Code shall
apply, except that in applying those rules, the term "family" shall
include only the Participant's Spouse and lineal descendants who
have not attained age 19 before the close of the Plan Year. If as a
result of the application of the rules of Section 414(q)(6) the
adjusted $150,000 limitation is exceeded, the limitation shall be
prorated among the affected individuals in proportion to each
individual's Compensation as determined under this Section prior to
the application of the limitation.
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3. Effective January 1, 1994, Section 2.75 is amended to read as
follows:
2.75 Temporary Employee means an Employee whose customary annual
employment is six months or less.
4. Effective October 21, 1992, Section 3.2(a)(ii) is amended to read
as follows:
(ii) Temporary Employees shall begin participation in the Plan on
the day following the day they complete one "year of eligibility
service." A "year of eligibility service" is an eligibility
computation period during which the Temporary Employee completes at
least 1,000 Hours of Service. The first eligibility computation
period of a Temporary Employee is the 12-month period beginning on
the day he first completes an Hour of Service. Thereafter, the
Temporary Employee's eligibility computation period is the Plan
Year.
5. Effective October 21, 1992, Sections 4.1(a)(i) and (ii) are
amended to read as follows:
(a)(i) Before Tax Matched Contributions. Subject to the limitations
of Section 4.6, 4.10 and 5.4, each Participant shall have the option
to authorize the Employer in accordance with procedures established
by the Pension Committee, to contribute to the Plan for a Plan Year
on his behalf, an amount equal to any whole percentage of his
Compensation from one percent (1%) up to six percent (6%) (as
determined without regard to this Section 4.1(a)) for such Plan
Year. Such authorization shall be in the form of an election by the
Participant to have his Compensation reduced by payroll withholding.
The election of a new Participant shall be effective as soon as
administratively feasible following receipt of the election by the
Pension Committee. Such withheld amounts are to be transmitted by
the Employer to the Trustee as of the earliest date on which such
amounts can reasonably be segregated from the Employer's general
assets, but in no event later than 90 days after such amounts are
withheld from the Participant's Compensation.
(ii) Before Tax Supplemental Contributions. Subject to the
limitations of Section 4.6, 4.10 and 5.4, each Participant shall
have the option to authorize the Employer in accordance with
procedures established by the Pension Committee, to contribute to
the Plan for a Plan Year on his
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behalf, an amount equal to any whole percentage of his Compensation
from seven percent (7%) up to sixteen percent (16%) (as determined
without regard to this Section 4.1(a)) for such Plan Year. Such
authorization shall be in the form of an election by the Participant
to have Compensation reduced by payroll withholding. The election of
a new Participant shall be effective as soon as administratively
feasible following receipt of the election by the Pension Committee.
Such withheld amounts are to be transmitted by the Employer to the
Trustee as of the earliest date on which such amounts can reasonably
be segregated from the Employer's general assets, but in no event
later than 90 days after such amounts are withheld from the
Participant's Compensation.
6. Effective October 21, 1992, Sections 4.1(b) and (c) are amended
to read as follows:
(b) Employer Matched Contributions. Subject to the limitations
of Sections 4.8 and 5.4 and except for those Participating Employers
listed differently on Appendix A, an Employer shall contribute with
respect to each pay period an amount equal to 50% of a Participant's
Before Tax Matched Contributions that a Participant has authorized
the Employer to make on his behalf for the Plan Year. In the event a
Participant who is not a Highly Compensated Employee for the Plan
Year and who is not participating in one of the nonqualified
deferred compensation plans sponsored by the Company elected to make
Before Tax Matched Contributions in such amount that the limitations
under Section 402(g) of the Code restricted the Participant's Before
Tax Contributions, that Participant shall receive an Employer
Matched Contribution as if the full amount of the Before Tax
Contributions of the Participant has been made. The amount of such
contribution shall not exceed the maximum amount allowable as a
deduction under the Code for such Plan Year.
(c) ONECS. Subject to the limitations of Section 4.6 or 4.8,
whichever is applicable, and 5.4, the Employer shall contribute for
each Plan Year an amount, if any, as determined by the Board of
Directors on behalf of some or all Participants who are not Highly
Compensated Eligible Participants. The amount of such contribution
shall not exceed the maximum amount allowable as a deduction under
the Code for such Plan Year. It is intended that this contribution
shall constitute a qualified nonelective contribution within the
meaning of Treas. Reg. 1.401(k)-1(g)(13)(ii) or any successor
thereto.
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7. Effective October 21, 1992, Section 4.2 is amended to read as
follows:
4.2 Post 1986 After Tax Contributions. Subject to the limitations of
Sections 4.8, 4.10 and 5.4, each Participant shall have the option
to contribute to the Plan for a Plan Year an amount equal to any
percentage of his Compensation up to ten percent (10%) for such Plan
Year. Such authorization shall be in the form of an election by the
Participant to have his Compensation reduced on an after-tax basis
by payroll deduction in accordance with procedures established by
the Pension Committee. Such amounts are to be transmitted by the
Employer to the Trustee as of the earliest date on which such
amounts can be reasonably segregated from the Employer's general
assets, but in no event later than 90 days after such amounts have
been withheld from Participants' Compensation. Effective April 1,
1993, Participants shall not have the option to contribute to the
Plan on an after-tax basis. Pre-April 1, 1993, after-tax
contributions shall continue to be held by the Plan in accordance
with the provisions of the Plan.
8. Effective October 21, 1992, Section 4.4(e) is amended to read as
follows:
(e) The amount of any Employer contribution shall be subject
to the limitations prescribed in Section 5.4.
9. Effective October 21, 1992, Section 4.7 is amended to read as
follows:
4.7 Income Attributable to Excess Contributions. The Income
attributable to a Participant's Excess Contributions pursuant to
Section 4.6 for the Plan Year during which such Excess Contributions
arose shall be determined by multiplying the Income for the Plan
Year and, if the Pension Committee so provides, for the period
between the end of the Plan Year and the date the Excess
Contributions are distributed, the "gap period," allocable to Before
Tax Contributions, and amounts treated as Before Tax Contributions
pursuant to Section 4.1(c), by a fraction. The numerator of the
fraction is the Excess Contributions for the Employee for the Plan
Year. The denominator of the fraction is equal to the sum of (1) and
(2) where (1) is the Employee's total account balance attributable
to Before Tax Contributions and amounts treated as such as of the
beginning of the Plan Year and (2) is the Employee's Before Tax
Contributions and amounts treated as such for
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the Plan Year and, if the Pension Committee so provides, for the gap
period.
10. Effective October 21, 1992, Section 4.9 is amended to read as
follows:
4.9 Income Attributable to Excess Aggregate Contributions. The
Income attributable to a Participant's Excess Aggregate
Contributions pursuant to Section 4.8 for the Plan Year during which
such Excess Aggregate Contributions arose shall be determined by
multiplying the Income for the Plan Year and, if the Pension
Committee so provides, for the period between the end of the Plan
Year and the date the Excess Aggregate Contributions are
distributed, the "gap period," allocable to the Employer Matched
Contributions, Post 1986 After Tax Contributions and amounts treated
as Employer Matched and Post 1986 After Tax Contributions pursuant
to Section 4.1(c), by a fraction. The numerator of the fraction is
the Excess Aggregate Contributions for the Employee for the Plan
Year. The denominator of the fraction is equal to the sum of (1) and
(2) where (1) is the Employee's total account balance attributable
to Employer Matched Contributions, Post 1986 After Tax
Contributions, and amounts treated as such as of the beginning of
the Plan Year and (2) is the Employee's Employer Matched
Contributions, Post 1986 After Tax Contributions and amounts treated
as such for the Plan Year and, if the Pension Committee so provides,
for the gap period.
11. Effective October 21, 1992, Section 6.4 is amended to read as
follows:
6.4 Vesting. A Participant shall have a fully vested and
non-forfeitable interest in all of his Accounts other than his HMI
Company Regular Account. A Participant's vested interest in his HMI
Company Regular Account shall be determined in accordance with the
following schedule:
12 Month Period of Service Vested Percentage
-------------------------- -----------------
Less than 1 0%
1 but less than 2 20%
2 but less than 3 40%
3 but less than 4 60%
4 but less than 5 80%
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5 or more 100%
A Participant who is employed by the Employer or an Affiliate upon
attainment of Normal Retirement Age shall be 100% vested in his HMI
Company Regular Account.
12. Effective October 21, 1992, a new Section 6.10(1) is added to
read as follows:
(1) If amounts attributable to a Participant's HMI company Regular
Account are to be used as security for a loan, and the Participant's
total accrued benefit under the Plan has ever exceeded $3,500, the
Participant's Spouse, if any, must consent to the use of the amounts
as security for the loan. The Spouse must consent no earlier than
the 90- day period ending on the date the loan is to be secured. The
consent must be in writing, acknowledge the effect of the loan and
be witnessed by a Plan representative or notary public.
13. Effective October 21, 1992, Section 13.2 is amended to read as
follows:
13.2 Top-Heavy Plan. This Plan shall be Top-Heavy and an Aggregation
Group shall be a Top-Heavy Group if as of the Determination Date for
such Plan Year the sum of the Cumulative Accrued Benefits and
Cumulative Accounts of Key Eligible Employees for the Plan Year
exceeds 60% of the aggregate of all the Cumulative Accounts and
Cumulative Accrued Benefits. For this purpose, the Benefits and
Accounts of an individual who has not completed an Hour of Service
in the 5-year period ending on the applicable Determination Date
shall not be taken into account.
(a) If the Plan is not included in a Required Aggregation
Group with other plans, then it shall be Top-Heavy only if (i) when
considered by itself it is a Top-Heavy Plan and (ii) it is not
included in a Permissive Aggregation Group that is not a Top-Heavy
Group.
(b) If the Plan is included in a Required Aggregation Group
with other plans, it shall be Top-Heavy only if the Required
Aggregation group, including any permissively aggregated plans, is
Top-Heavy.
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14. Effective October 21, 1992, Exhibit A of the Plan, at Section
(a), is amended to read as follows:
The following provisions shall apply only if a Participant elects
option (iii), "purchase of an annuity".
(a) Unless a Participant elects otherwise with the consent of
his Spouse, if applicable, to have his benefits paid in other than a
qualified joint and 50% survivor annuity, the Participant shall be
deemed to have elected to receive that portion of his benefits under
the Plan in (i) a single life annuity if the Participant is not
married on the Annuity Starting Date; and (ii) a qualified joint and
50% survivor annuity if the Participant is married on the Annuity
Starting Date. Payments under the single life annuity and the
qualified joint and 50% survivor annuity shall commence immediately
after the annuity is purchased. The Employer shall purchase the
applicable annuity with that portion of the Participant's vested
Merged HMI Account balance.
IN WITNESS WHEREOF, the Company has executed this Second Amendment
of Acordia 401(k) Long Term Savings Investment Plan this __ day of _______,
1997.
Accordia, Inc.
By: ________________
Daniel W. Kendall
Chair, Acordia Pension
Benefit Administration Compliance
Committee
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THIRD AMENDMENT OF ACORDIA
401(k) LONG TERM SAVINGS INVESTMENT PLAN
The Acordia 401(k) Long Term Savings Investment Plan (the "Plan") is
hereby amended as follows:
1. Effective July 1, 1996, (1) the term "Anthem Insurance Companies,
Inc." shall be substituted for the term "Associated Insurance Companies, Inc.",
(2) the term "Anthem Savings Plan" shall be substituted for the term "TAG
Savings Plan", (3) the term "The Anthem 401(k) Long Term Savings Investment
Plan" shall be substituted for the term "The Associated Group 401(k) Long Term
Savings Investment Plan", and (4) the term "Anthem Employer" shall be
substituted for the term "TAG Employer", each place in the Plan that the term
appears.
2. Effective January 1, 1996, the Introduction to the Plan is hereby
amended to add the following two new paragraphs to the end of the Introduction:
Effective January 1, 1996, The Rudy E. Facciani Co. Ins. Marketing
Inc. 401(k) Plan ("Merged Plan VII") is merged into the Plan. The
rights of any eligible participant in Merged Plan VII who terminated
employment prior to the merger of Merged Plan VII into the Plan
shall be determined under the terms of Merged Plan VII in effect
prior to the date of the merger. The specific provisions applicable
to Merged Plan VII are set forth in Exhibit C to the Plan.
Effective February 1, 1996, the O'Rourke, Andrews & Maroney, Inc.
401(k) Plan ("Merged Plan VIII") is merged into the Plan. The rights
of any eligible participant in Merged Plan VIII who terminated
employment prior to the merger of Merged Plan VIII into the Plan
shall be determined under the terms of Merged Plan VIII in effect
prior to the date of the merger. The specific provisions applicable
to Merged Plan VIII are set forth in Exhibit D to the Plan.
3. Effective January 1, 1996, Section 2.8 of the Plan is amended to
read as follows:
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2.8 Before Tax Matched Account means the account maintained for a
Participant to record (i) his share of Before Tax Matched
Contributions under Paragraph 4.1(a)(i); (ii) his share of
before tax matched contributions under Merged Plans I, II, IV,
V and VII, if any; (iii) his share of before tax matched
contributions that he made under the Raff-Hughes Plan, which
he has elected to transfer to this Plan, if any; and (iv)
adjustments relating thereto.
4. Effective January 1, 1996, the first paragraph of Section 2.39(d)
of the Plan is amended to read as follows:
(d) Equivalencies. To the extent that the Plan requires Hours
of Service to be counted, the Pension Committee shall have the
authority to adopt any of the following equivalency methods for
counting Hours of Service that are permissible under regulations
issued by the Department of Labor: (1) Working Time, (2) Periods of
Employment, or (3) Earnings.
5. Effective January 1, 1996, Section 2.51 of the Plan is hereby
amended to designate the existing paragraph as Subsection (a) and add new
Subsections (b) and (c) to read as follows:
(b) Merged Plan VII means The Rudy E. Facciani Co. Ins.
Marketing, Inc. 401(k) Plan, which was in effect prior to its merger
into the Plan on January 1, 1996.
(c) Merged Plan VIII means the O'Rourke, Andrews & Maroney,
Inc. 401(k) Plan, which was in effect prior to its merger into the
Plan on February 1, 1996.
6. Effective February 1, 1996, new Sections 2.81, 2.82 and 2.83 are
added to the Plan to read as follows:
2.81 O'Rourke Before Tax Contribution Account means the Account
maintained for a Participant to record the before tax
contributions made on his behalf under Merged Plan VIII and
the income on those contributions.
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2.82 O'Rourke Company Account means the Account maintained for a
Participant to record the discretionary employer contributions
made on his behalf under Merged Plan VIII and the income on
those contributions.
2.83 O'Rourke Matched Account means the Account maintained for a
Participant to record the matching employer contributions made
on his behalf under Merged Plan VIII and the income on those
contributions.
7. Effective January 1, 1996, Section 3.2 of the Plan is hereby
amended to add new Subsections (d) and (e) to read as follows:
(d) Effective January 1, 1995, any Eligible Employee who was
previously a participant in Merged Plan VIII, or who was eligible to
participate in Merged Plan VIII but had not yet met the service
requirement applicable to Merged Plan VIII shall become a
Participant in this Plan on January 1, 1995.
(e) Effective January 1, 1996, any Eligible Employee who was
previously a participant in Merged Plan VII, or who was eligible to
participate in Merged Plan VII but had not yet met the service
requirement applicable to Merged Plan VII shall become a Participant
in this Plan on January 1, 1996.
8. Effective January 1, 1996, Subsection 4.1(b) of the Plan is
amended to read as follows:
(b) Employer Matched Contributions. Subject to the limitations
of Section 4.8 and 5.4, an Employer shall contribute with respect to
each pay period an amount equal to 50% of a Participant's Before Tax
Matched Contributions that a Participant has authorized the Employer
to make on his behalf of the Plan Year. If a Participant is not a
Highly Compensated Employee for the Plan Year and is not
participating in one of the nonqualified deferred compensation plans
sponsored by the Company, that Participant shall receive an
additional Employer Matched Contribution equal to the difference, if
any, between the amount contributed pursuant to the preceding
sentence and an amount equal to 50% of the Participant's Before Tax
Matched Contribution for the Plan Year. The amount of the
contribution made pursuant to this Subsection shall not exceed the
maximum amount allowable as deduction under the Code for such Plan
Year.
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9. Effective January 1, 1996, Subsection 6.9(a)(C) of the Plan is
amended to read as follows:
(C) The payment of tuition and related educational fees
(including applicable room and board) for the next twelve months of
post-secondary education for the Participant, his Spouse, children
or dependents (as defined in Section 152 of the Code); or
10. Effective January 1, 1996, Paragraph 6.9(d)(2) of the Plan is
amended to read as follows:
Except as provided in Exhibits C and D only two withdrawals in any
Plan Year shall be permitted.
11. Effective January 1, 1996, Paragraph 6.9(d)(4) of the Plan is
amended to read as follows:
Except as provided in Exhibit D, the minimum amount allowable for
withdrawal shall be $300.00; provided, however, that a Participant
may make a hardship withdrawal in accordance with Subsection 6.10(a)
in an amount less than $300.00.
12. Effective July 1, 1996, Subsection 6.10(b) of the Plan is
amended to read as follows:
(b) The period of repayment for any loan shall be determined
by mutual agreement between the Pension Committee and the borrower,
but such period shall not exceed five years except for loan used to
acquire the Participant's principal residence. Loans used to acquire
a Participant's principal residence shall not exceed ten (10) years.
All loan terms shall be in multiples of one year. Repayment of
interest and principal shall be according to a substantially level
amortization schedule of payments beginning as soon as
administratively feasible following receipt of the loan. Repayment
of interest and principal shall be by payroll deduction, except for
those Participants who are not receiving a pay check or who are laid
off with recall rights, with respect to whom a loan repayment check
shall be due in accordance with the amortization schedule in effect.
Loans may be prepaid in full at any time without penalty. Loan
repayments shall be allocated to a Participant's Accounts in reverse
order to those Accounts from which the loan was distributed as set
forth in Section 6.10(j) below and shall
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be invested pursuant to a Participant's current investment
elections. If a Participant has no investment election in effect
with respect to an Account to which a loan repayment is allocated,
the Trustee shall invest the loan repayment in an Investment Fund
designated from time to time by the Pension Committee or its
designees.
13. Effective January 1, 1996, Subsection 6.10(f) of the Plan is
amended to read as follows:
(f) The procedure to be followed by a Participant in applying
for a loan shall be determined by the Pension Committee and
documented by a duly approved set of rules of the Pension Committee.
Such rules shall be attached to and shall be deemed to be part of
the Plan. Loans made pursuant to Merged Plans III, IV and V were
made in accordance with rules established under those Merged Plans
as in effect prior to their mergers into the Plan. Loans with
respect to any amounts transferred to this Plan from the Anthem
Savings Plan attributable to the Raff-Hughes Plan were made in
accordance with rules established under the Raff-Hughes Plan.
14. Effective January 1, 1996, Section 7.2(b)(ii) of the Plan is
amended to read as follows:
(ii) Rollover Contributions. A Participant for whom amounts
are rolled over to the Plan pursuant to Section 4.11 shall make a
separate election with respect to the initial investment of those
amounts.
15. Effective July 1, 1996, Paragraph 7.2(c)(iv) of the Plan is
amended to read as follows:
(iv) Failure to Direct Investments. If a Participant fails to
make an investment election with respect to any amounts allocated to
his Accounts, including amounts contributed to the Plan pursuant to
Section 4.1 (Employer Contributions), Section 4.11 (rollovers), and
amounts transferred to the Plan from a Merged Plan, the Trustee
shall invest the amounts in an Investment Fund designated from time
to time by the Pension Committee or its designees.
16. Effective October 1, 1996, Section 7.4 of the Plan is amended to
read as follows:
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7.4 Special Rules Applicable to Persons Subject to Section 16(b)
of The Securities Exchange Act of 1934. Notwithstanding any
other provisions of the Plan, the following special rules
shall apply to Participants or former Participants who are
subject to the requirements of Section 16(b) of the Securities
Exchange Act of 1934 ("Insiders"):
(a) At the option of the Insider, an Insider may make a
withdrawal pursuant to Section 6.9 from his Accounts only under the
procedures set forth in (i) or (ii):
(i) If the withdrawal will result in a reduction in the
number of shares of Acordia Stock in his Accounts, the
withdrawal must be made pursuant to an election made at least
six months prior to the date of the most recent election, with
respect to the Plan or any other plan of the Company, that
effected an acquisition of Acordia Stock. If the withdrawal is
made, then until the date at least six months after the
Insider's election to receive the withdrawal, the Insider
shall not be permitted to elect, with respect to the Plan or
any other plan of the Company, to effect an acquisition of
Acordia Stock notwithstanding Section 7.2 hereof.
(ii) In the event of a withdrawal, the withdrawal shall
be taken first from assets in the Participant's Accounts other
than Acordia Stock. An Insider may elect to reallocate amounts
held in his Accounts pursuant to Section 7.2 in a manner that
would increase or decrease the number of shares of Acordia
Stock in his Accounts only pursuant to an election made at
least six months after the most recent election, with respect
to the Plan or any other plan of the Company, to reallocate
amounts or otherwise effect a transaction in the opposite way
of the current election (i.e., an election of a reallocation
which is an acquisition must be made at least six months
following an election which is a disposition).
(b) None of the special rules described in this Section shall
preclude the Trustee from using cash dividends paid on Acordia Stock
to purchase additional shares of such Stock for any Insider.
(c) To provisions of this Plan are intended to comply with all
applicable provisions of Rule 16(b)-3 of the Securities Exchange Act
of 1934 and its successors with respect to Insiders. To the extent
any provision of the Plan or action by the Pension Committee on
behalf of an Insider fails to so comply, such provision or action
shall be deemed
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null and void to the extent permitted by law and deemed advisable by
the Pension Committee.
17. The Plan is further amended to add the attached Exhibits C and D
to the end of the Plan.
18. Effective December 31, 1996, the Plan is further amended to add
the revised Appendix A attached hereto.
IN WITNESS WHEREOF, Acordia Inc. has executed this Third Amendment
of the Acordia 401(k) Long Term Saving Investment Plan this __ day of December
6, 1997.
ACORDIA, INC.
By: __________________
Keith A. Maib
Chair, Acordia Pension
Committee
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EXHIBIT C
ACORDIA 401(k) LONG TERM SAVINGS INVESTMENT PLAN
Merged Plan:The Rudy E. Facciani Co. Ins. Marketing,
Inc. 401(k) Plan ("Facciani Plan")
Merger Date:January 1, 1996
Participation: An Eligible Employee who was a participant in the Facciani Plan
on the Merger Date, or who was eligible to participate in the
Facciani Plan on the Merger Date but had not yet met the service
requirements applicable to the Facciani Plan, shall become a
participant in the Plan on the Merger Date and shall be eligible to
make Before Tax Contributions in accordance with the Plan.
Accounts: A Participant's account under the Facciani Plan shall be held
in a similar Account under the Plan and shall be subject to
the provisions of the Plan except as provided in this Exhibit
C.
Vesting: Notwithstanding any provision of the Facciani Plan to the
contrary, a participant in the Facciani Plan on the Merger
Date shall have a fully vested and nonforfeitable interest in
his accounts under the Facciani Plan on the Merger Date.
Withdrawals: Notwithstanding Paragraphs 6.9(d)(2) and (4) of the Plan, a
Participant who was a participant in the Facciani Plan may make a
withdrawal of any portion of his Before Tax Matched Account
attributable to contributions (but not the income on those
contributions) made under the Facciani Plan any number of times
during a Plan Year if the withdrawal is (1) on account of an
immediate and heavy financial need described in Subsection 6.9(a) of
the Plan or an event that the Internal Revenue Service deems to
constitute an immediate and heavy financial need under Code
subsection 401(k), or (2) on or after the Participant attains age 59
1/2.
Investments: Participants in the Facciani Plan shall have the opportunity to
make investment directions with respect to their Accounts held under
the Plan, including those Accounts attributable to the Facciani
Plan, in accordance with Section 7.2 of the Plan, as soon as
administratively feasible following the Merger Date.
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EXHIBIT D
ACORDIA 401(k) LONG TERM SAVINGS INVESTMENT PLAN
Merged Plan:O'Rourke, Andrews & Maroney, Inc. 401(k) Plan ("O'Rourke Plan")
Merger Date:February 1, 1996
Participation: An Eligible Employee who was a participant in the O'Rourke Plan
on the Merger Date, or who was eligible to participate in the
O'Rourke Plan on the Merger Date but had not yet met the service
requirements applicable to the O'Rourke Plan, shall become a
participant in the Plan on the Merger Date and shall be eligible
to make Before Tax Contributions in accordance with the Plan.
Accounts: A Participant's account under the O'Rourke Plan shall be held
in a separate Accounts under the Plan and shall be subject to
the provisions of the Plan except as provided in this Exhibit
D.
Vesting: A Participant shall have a fully vested and nonforfeitable
interest in his accounts under the O'Rourke Plan on January 1,
1996.
Special
Payment
Provisions: That portion of a Participant's Accounts attributable to
contributions made under the O'Rourke Plan and the income on those
contributions ("O'Rourke Accounts") shall be paid as described in
this section. The provisions of (a), (b), (e) and (f) apply only if
a Participant terminates his employment with the Employer and does
not die before the Annuity Starting Date. The provisions of (c),
(d), (e) and (f) apply only if a Participant dies before the Annuity
Starting Date.
(a) Single Life Annuity and Qualified Joint and Survivor
Annuity. Unless a Participant elects otherwise with the
consent of his Spouse, if applicable, he shall receive his
termination benefits attributable to his O'Rourke Accounts in
the form of (i) a single life annuity or (ii) a qualified
joint and 50% survivor annuity. Payment of the applicable
annuity will begin as of the later of the date the Participant
terminates employment or the date the Participant attains his
Normal Retirement Age, unless the Participant elects earlier
payment. The Participant shall be entitled to receive a
qualified joint and 50% survivor annuity if he was married on
the Annuity Starting Date.
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(b) Notice and Election to Waive Single Life Annuity and
Qualified Joint and Survivor Annuity. The Pension Committee or
its designees shall furnish each Participant with the
following information regarding the single life annuity and
qualified joint and survivor annuity not less than 30 and not
more than 90 days prior to the Annuity Starting Date:
(1) A general explanation of the terms and
conditions of the single life annuity or qualified joint
and 50% survivor annuity, as applicable;
(2) The Participant's right to waive the single
life annuity or qualified joint and 50% survivor
annuity, as applicable, and to elect another form of
payment;
(3) The Participant's right to revoke a previous
waiver of the single life annuity or qualified joint and
50% survivor annuity; and
(4) A general explanation of the rights of a
Participant's Spouse, if applicable.
A Participant may waive the single life annuity or qualified
joint and 50% survivor annuity, as applicable, and receive his
benefits in a lump sum or in any annuity form permitted by the
O'Rourke Plan by giving written notification to the Pension
Committee during the election period. The O'Rourke Plan
permitted any annuity form payable for a period not exceeding
either the life of the Participant (or the lives of the
Participant and his designated Beneficiary) or the life
expectancy of the Participant (or the life expectancies of the
Participant and his designated Beneficiary). The election
period is the 90-day period ending on the Annuity Starting
Date. Payment of the alternate form will begin as of the later
of the date the Participant terminates employment or the date
the Participant attains his Normal Retirement Age, unless the
Participant elects earlier payment.
Any waiver of the qualified joint and 50% survivor annuity and
election of an alternate benefit shall not take effect unless
the Participant's Spouse consents irrevocably in writing to
the waiver and the Spouse's consent acknowledges the effect of
the waiver and is witnessed by a Plan representative or notary
public. A Spouse's consent will be valid only with respect to
that Spouse.
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Any new waiver will require a new Spousal consent. The Spousal
consent requirements may be waived if it is established to the
satisfaction of the Pension Committee that the Spouse's
consent may not be obtained because there is no Spouse or the
Spouse cannot be located, or under other circumstances
prescribed by federal regulation.
Any waiver of the single life annuity or qualified joint and
50% survivor annuity may be revoked by the Participant during
the election period by written notification to the Pension
Committee. Following the revocation, another waiver may be
made at any time during the election period. A revocation of a
prior waiver may be made by a Participant at any time before
commencement of benefits without the consent of the Spouse.
(c) Qualified Pre-retirement Survivor Annuity. Unless a
Participant who is married on the date of his death has
elected otherwise with the consent of his Spouse, or after his
death his Spouse elects otherwise, his Spouse shall receive
death benefits attributable to one-half of his O'Rourke
Accounts in the form of a qualified preretirement survivor
annuity. Payment of the annuity will begin as of the date of
the Spouse elects. The Participant's Beneficiary shall receive
the other one-half of his O'Rourke Accounts in the form of a
lump sum or, if the Beneficiary is his Spouse, apply the other
one-half to increase the amount of the qualified preretirement
survivor annuity.
The Beneficiary of a Participant who is not married on the
date of his death shall receive the entire amount in the
Participant's O'Rourke Accounts in the form of a lump sum.
(d) Notice and Election to Waive Qualified Preretirement Survivor
Annuity. The Pension Committee shall furnish each Participant
with information regarding the qualified preretirement
survivor annuity that is similar to the information furnished
regarding the single life annuity and qualified joint and 50%
survivor annuity. The information shall be provided within
whichever of the following periods ends last:
(1) The period beginning with the first day of the Plan Year
in which the participants attains age 32 and ending with
the close of the Plan Year in which the Participant
attains age 34;
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(2) A reasonable period after the individual becomes a
Participant. If an individual becomes a Participant
after age 35, the reasonable period is the one-year
period beginning with the first day of the first Plan
Year for which the individual is a Participant; or
(3) A reasonable period after the individual separates from
service. If an individual before attaining age 35, the
reasonable period is the period beginning one year
before the separation and ending one year after the
separation.
A Participant may waive the qualified preretirement survivor
annuity and designate his Spouse or another Beneficiary to
receive the benefits in a lump sum by giving written
notification to the Pension Committee during the election
period. The election period is the period which begins on the
first day of the Plan Year in which the Participant attains
age 35 and ends on the earlier of the date of the
Participant's death or the Annuity Starting Date. An earlier
waiver may be made provided the information regarding the
qualified preretirement survivor annuity described above is
given to the Participant prior to the waiver and the waiver
becomes invalid at the beginning of the Plan Year in which the
Participants attains 35. If a Participant separates from
service, the election period with respect to benefits accrued
before his separation shall begin on his separation date.
Any waiver of the qualified preretirement survivor annuity and
election of an alternate benefit shall not take effect unless
the Participant's Spouse consents irrevocably in writing to
the waiver and the Spouse's consent acknowledges the effect of
the waiver and is witnessed by a notary public or Plan
representative. A Spouse's consent will be valid only with
respect to that Spouse. Any new waiver will require a new
Spousal consent. The Spousal consent requirements may be
waived if it is established to the satisfaction of the Pension
Committee that the Spouse's consent may not be obtained
because there is no Spouse or the Spouse cannot be located, or
under other circumstances prescribed by federal regulation.
Any waiver of the qualified preretirement survivor annuity may
be revoked by the Participant during the election period by
written notification to the Pension Committee. Following the
revocation, another waiver may be made at any time during the
election period. A revocation of a prior waiver may be made at
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any time by a Participant before death without the consent of
the Spouse.
(e) Special Rule for Small Payments. The Participant's O'Rourke
Accounts shall be paid in a lump sum if at the time of
distribution, and at the time of any prior distribution, the
Participant's O'Rourke Accounts together with his Accounts in
the Plan, do not exceed and did not exceed, $3,500.
(f) Annuity Starting Date. Annuity Starting Date means the first
day of the first period for which an annuity is payable as an
annuity. In the case of a benefit not payable as an annuity,
Annuity Starting Date means the first day on which all
conditions have been met with entitle the Participant to the
benefit.
Withdrawal: Notwithstanding Paragraph 6.9(d)(2) of the Plan, a Participant who
was a participant in the O'Rourke Plan may make a withdrawal of any
portion of his before tax contributions (and income on those
contributions earned prior to January 1, 1989) made under the
O'Rourke Plan any number of times during a Plan Year. A
Participant's withdrawal are subject to (a), (b), (e) and (f) of the
Special Payment Provisions above.
Investment: Participants in the O'Rourke Plan shall have the opportunity to make
investment directions with respect to their Accounts held under the
Plan, including those Accounts attributable to the O'Rourke Plan, in
accordance with Section 7.2 of the Plan, as soon as administratively
feasible following the Merger Date.
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APPENDIX A - PARTICIPANTS EMPLOYERS
ACCORDIA 401(k) LONG TERM SAVINGS INVESTMENT PLAN
12/31/96
Acordia Benefits of Florida, Inc.
Acordia Benefits of Northern California, Inc.
Acordia Educational Benefits of Texas Agency,Inc.
Acordia Healthcare Solutions, Inc.
Acordia, Inc.
Acordia Northeast, Inc.
Acordia of Central Indiana, Inc.
Acordia of Northwest Indiana, Inc.
Acordia of Central Pennsylvania, Inc.
Acordia of Cincinnati, Inc.
Acordia of Cleveland, Inc.
Acordia of Colorado, Inc,
Acordia of Dallas, Inc.
Acordia of Evansville, Inc.
Acordia of Lexington, Inc.
Acordia of Louisville, Inc.
Acordia of Michigan, Inc.
Acordia of Mississippi, Inc.
Acordia of North Carolina, Inc.
Acordia of Northeast Indiana, Inc.
Acordia of Pennsylvania, Inc.
Acordia of Phoenix, Inc.
Acordia of South Florida, Inc.
Acordia of Southern California, Inc.
Acordia of West Virginia, Inc.
Acordia Personal Benefits Agency, Inc.
Acordia Personal Benefits of Utah, Inc.
Acordia/Pettit-Morry Co. of California,Inc.
Acordia/Pettit-Morry Co. of Oregon, Inc.
Acordia Senior Benefits, Inc.
Acordia Senior of the Southeast, Inc.
Acordia Small Business Benefits, Inc.
Acordia Texas Gulf Coast, Inc.
Acordia West Texas, Inc.
Anthem Marketing Services, Inc.
Group Plan Consultants, Inc.
Hogg Robinson Consulting Group, Inc.
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Hogg Robinson of New York, Inc.
Hogg Robinson of Virginia, Inc.
LWP Services, Inc.
Moore-Peterson Insurance Agency Company, Inc.
Puget Sound Underwriters, Inc.
Risk Group, Inc.
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