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HANDY & HARMAN PENSION PLAN
As Amended And Restated Effective December 1, 1989
This is the Handy & Harman Pension Plan as amended and restated
effective December 1, 1989 which unless otherwise expressly provided
herein covers eligible employees of Handy & Harman and those of its
Affiliated Corporations which have adopted the Plan for their eligible
employees. The rights to benefits, if any, of employees who terminated
employment prior to December 1, 1989 shall unless otherwise expressly
provided herein be determined under the Plan, if any, as in effect for
the employee at the date of his termination of employment. This amended
and restated plan includes amendments to the plan as amended and
restated effective December 1, 1984 through the twentieth amendment
effective January 1, 1993. This plan includes amendments through the
1994 Plan Year to comply with the provisions of the Tax Reform Act of
1986 as amended and corresponding regulations.
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HANDY & HARMAN PENSION PLAN
TABLE OF CONTENTS
Article 1 General Definitions
Article 2 Provisions Relating To Participation
Article 3 Definitions For Computation Of Accrued Benefit
Article 4 Benefits For Participants, Their Surviving Spouses And
Beneficiaries
Article 5 Contributions
Article 6 Pension Trust
Article 7 Administration Of The Pension Plan
Article 8 Amendments To The Pension Plan
Article 9 Termination Of The Pension Plan
Article 10 Temporary Limitation On Benefits For Highly-Paid Employees
Article 11 Limitations On Benefits
Article 12 Top-Heavy Provisions
Article 13 Merger, Consolidation, Or Asset Or Liability Transfer
Article 14 Miscellaneous Provisions
This plan covers several Participating Companies of Handy & Harman. A list of
Participating Companies is included at the end of Article 1. This plan document
includes a separate Article 2, 3 and 4 for each Participating Company, with each
set noted by the letter designation included on the list of Participating
Companies. There is also an additional Article 3 and Article 4 which contains
provisions generally applicable to all Participating Companies.
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HANDY & HARMAN PENSION PLAN
Article 1
GENERAL DEFINITIONS
Wherever used in this document, the words and phrases defined in this
Article 1 shall have the meanings stated in this Article 1 unless the
context clearly indicates otherwise.
1.1 "Actuarial Equivalent" shall mean when applicable to a benefit hereunder
that the benefit has, at the date of determination, the same value as the
applicable other benefit hereunder when computed with interest at 8% per
year, compounded annually, and with mortality in accordance with the Unisex
Pension 1984 Mortality Table without set back in the case of the
Participant and set back three years in the case of a co-pensioner. In any
case where the Actuarial Equivalent of the monthly benefit payable to any
Participant or surviving spouse must be determined as a single sum amount,
such Actuarial Equivalent shall be determined on the basis of the above 8%
interest rate unless the level interest rate that is equivalent to the
interest rates used by the PBGC to value deferred annuities (or in the case
of a Participant or surviving spouse who is entitled to an immediate
pension, to value immediate annuities) for pension plans terminating as of
the first day of the Plan Year
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in which the determination date falls is lower than such 8% interest rate
in which event such PBGC interest rates, or rate as applicable, shall be
used to determine the Actuarial Equivalent. In determining such single sum
amount the determination shall be made assuming the Participant is not
married and elects no optional form of pension. In the case of determining
the single sum amount for a Participant who is not entitled to an immediate
pension, such single sum amount shall be determined reflecting the amount
of pension commencing at the Participant's Normal Retirement Date.
1.2 "Affiliated Corporation" shall mean Handy & Harman, each corporation as to
which Handy & Harman is the successor, and any other corporation 50% or
more of whose outstanding voting stock is owned, directly or indirectly, by
Handy & Harman.
1.3 "Annuity Starting Date" shall mean:
(a) the first day of the first period for which an amount is payable as
an annuity, or
(b) in the case of a benefit not payable in the form of an annuity, the
first day on which all events have occurred which entitle the participant
to such benefit.
1.4 "Birthday" shall mean the anniversary of the date of birth of an
individual.
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1.5 "Board of Directors" shall mean the board of directors of Handy & Harman.
1.6 "Code" shall mean the Internal Revenue Code of 1986, as amended, or as it
may be amended from time to time.
1.7 "Committee" shall mean the administrative committee of the Pension Plan
provided for in Section 7.
1.8 "Company" shall mean Handy & Harman, a New York corporation.
"Participating Company" shall mean any Affiliated Corporation, or a
division (or location or other separately identifiable entity) that is a
part of any Affiliated Corporation, which is designated a Participating
Company by the Board of Directors, and which by action of its board of
directors adopts this Plan.
1.9 "Continuous Service" shall mean on any given date, except as otherwise pro-
vided in Section 2.1, the period of time commencing on the first day of the
month in which an employee's Employment Commencement Date or Reemployment
Commencement Date, whichever is applicable, occurs and ending on the first
day of the month coinciding with (next following, if none coincides with)
his Severance From Service Date. In the case of any individual who is an
employee
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of any company (or a division, location or other part of any company) that
is acquired by any Affiliated Corporation after December 31, 1982 and who
is employed by the company on such acquisition date, Continuous Service
shall not include any period prior to the date of acquisition unless
otherwise specifically provided for by the Board of Directors. Continuous
Service shall be stated in years and twelfth's of years.
An individual shall cease to accrue Continuous Service on his Severance
From Service Date provided, however, that an individual's Continuous
Service shall include the following periods:
(a) a period of authorized leave of absence granted by an Affiliated
Corporation,
(b) a period of up to twelve months during which an individual is on layoff,
(c) a period of up to twelve months during which an individual is absent from
active work on account of a compensable disability incurred during the
course of employment with an Affiliated Corporation, except that if the
individual returns to work with an Affiliated Corporation within 30 days
after final payment of statutory compensation for such disability or after
the end of the period used in calculating a lump sum payment, the full
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period during which the individual is absent,
(d) a period of up to twelve months after an individual shall have ceased to be
in the employment of an Affiliated Corporation if the individual returns to
employment with an Affiliated Corporation during such period, or
(e) a period of up to twenty-four months after an individual shall have ceased
to be in the employment of an Affiliated Corporation for a Maternity or
Paternity Leave if the individual returns to employment with an Affiliated
Corporation during such period. A Maternity or Paternity Leave shall be an
absence which commenced on or after December 1, 1985 by reason of (i) the
pregnancy of a Participant, (ii) the birth of a child or the adoption of a
child by the Participant or the Participant's spouse, or (iii) the care of
a Participant's child immediately after its birth or adoption.
An individual who has ceased to accrue Continuous Service because he has
ceased to be in the employment of an Affiliated Corporation shall
nevertheless retain the Continuous Service he had accrued at the time he
ceased to be in such employment:
(a) until the date of his death if he was a Vested Participant;
otherwise
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(b) until the end of a period of time equal to his period of Continuous
Service, or effective December 1, 1985 five One Year Periods Of Severance
if greater, but such Continuous Service shall be canceled as of the end of
such period of time if he has not prior thereto returned to employment with
an Affiliated Corporation and continued in such employment for the one year
period starting on his reemployment date.
1.10 "Employee" shall mean each individual who is in the employment of an
Affiliated Corporation on or after December 1, 1989 or such later date that
the employment unit which employs him became a Participating Company.
1.11 "Employment Commencement Date" shall mean the date on which an Employee
first performs an Hour of Service.
1.12 "ERISA" the Employee Retirement Income Security Act of 1974.
1.13 "Hour of Service" means an hour for which the Employee is paid, or entitled
to payment, by an Affiliated Corporation either for the performance of
duties for an Affiliated Corporation or for a period of time during which
no duties are performed due to vacations, holidays, illness, incapacity
(including disability), layoff, jury duty, military duty, or leave of
absence. In addition, Hour of Service shall include each hour for which
back pay, irrespective of mitigation of damages is either awarded
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or agreed to by an Affiliated Corporation, if such hour has not been
credited under the preceding sentence.
1.14 "Leased Employee" means any person (other than an employee of the
recipient) who pursuant to an agreement between the recipient and any other
person ("leasing organization") has performed services for the recipient
(or for the recipient and related persons determined in accordance with
Code Section 414(n)(6) on a substantially full time basis for a period of
at least one year, and such services are of a type historically performed
by employees in the business field of the recipient employer. Contributions
or benefits provided a Leased Employee by the leasing organization which
are attributable to services performed for the recipient employer shall be
treated as provided by the recipient employer. A Leased Employee shall not
be considered an employee of the recipient if:
(a) such employee is covered by a money purchase pension plan
providing:
(i) a non-integrated employer contribution rate of at least
10% of compensation, as defined in Code Section 415(c)(3), but
including amounts contributed pursuant to a salary reduction
agreement which are excludable from the employee's gross
income under Code Sections 125, 402(a)(8), 402(h) or 403(b);
(ii) immediate participation; and
(iii) full and immediate vesting.
(b) Leased Employees do not constitute more than 20% of the recipient's
non-highly compensated work force.
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Leased Employees are not eligible to participate in this Plan.
1.15 "Limitation Year" is the same as the calendar year.
1.16 "One Year Period Of Severance" shall mean an 12-consecutive month period
beginning on the Severance From Service Date or any anniversary thereof and
ending on the next succeeding anniversary of such date; provided, however,
that the employee during such 12-consecutive-month period does not complete
any hours of service within the meaning of 29 CFR Part 2530.200 b-2 (a) for
the employer or employers maintaining the plan.
1.17 "PBGC" shall mean Pension Benefit Guarantee Corporation.
1.18 "Pension Plan" shall mean the plan of pension benefits set forth herein
which shall be known as the Handy & Harman Pension Plan.
1.19 "Pension Trust" shall mean the trust established to implement the Pension
Plan.
1.20 "Pension Trustee" shall mean the person or persons or party or parties
acting as the trustee or trustees of and under the Pension Trust.
1.21 "Period Of Severance" shall mean the period of time commencing on the
Severance From Service Date and ending on the date when the employee again
performs an Hour of Service.
1.22 "Plan Year" on and after January 1, 1993 shall mean a year beginning on
January 1st and
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ending on the next December 31st, the same as the calendar year. "Plan
Year" on or prior to November 30, 1992 shall mean a year beginning on
December 1st and ending on the following November 30th. The period from
December 1, 1992 through December 31, 1992 shall be a "Plan Year".
1.23 "Qualified Domestic Relation Order", as referred to in Section 14.6, shall
mean a domestic relations order that satisfies the conditions of a
Qualified Domestic Relations Order as defined in the Retirement Equity Act
of 1984 as determined by the Committee. If the Plan is required to make
payments to an alternate payee under a Qualified Domestic Relations Order
then the benefits otherwise payable to a Participant and his spouse or
other beneficiaries, shall be adjusted so that the sum total of benefits
payable to the Participant, his spouse or other beneficiaries payees are
the Actuarial Equivalent of the benefits that would have been paid absent
the Qualified Domestic Relations Order.
1.24 "Reemployment Commencement Date" shall mean the first date following a
Period Of Severance from service which is not required to be taken into
account under the Plan on which the Employee first performs an Hour of
Service.
1.25 "Severance From Service Date" shall be the earlier to occur of the
following dates:
(a) the date on which the employee quits, retires, is discharged, or
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dies; or
(b) the first anniversary of the first date of a period in which the
employee remains absent from service (with or without pay) with an
Affiliated Corporation for any reason other than quit, retirement,
discharge or death, such as vacation, holiday, sickness, disability, leave
of absence or layoff.
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HANDY & HARMAN PENSION PLAN
Article 2A
PROVISIONS RELATING TO PARTICIPATION
Plan As In Effect At Handy & Harman
(For Plan purposes also referred to as "Handy & Harman")
2.1 "Continuous Service" shall be as defined in Section 1.9.
2.2 A. "Member Of The Eligible Class" for the period through December 31, 1992
shall mean each Employee of Handy & Harman excluding however each
Employee who is compensated on an hourly rate basis who is employed at
the East Providence, Rhode Island plant, and excluding any Employee who
is subject to a collective bargaining agreement which does not
incorporate the Plan, and excluding any Employee covered by another
retirement plan qualified under Code Section 401(a) sponsored by Handy &
Harman.
B. "Member Of The Eligible Class" for the period starting January 1, 1993
shall mean each Employee of Handy & Harman excluding however each
Employee who is compensated on an hourly rate basis who is employed at
either the East Providence, Rhode Island plant or the South Windsor
Metallurgical plant, and excluding any Employee who is subject to a
collective bargaining agreement which does not incorporate the Plan, and
excluding any Employee covered by another retirement plan qualified
under Code Section 401(a) sponsored by Handy & Harman.
2.3 "Participant" means, unless specifically stated, an Active
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Participant, Vested Participant, Disabled Participant or Inactive
Participant as the context indicates.
2.4 Active Participant. Each Member Of The Eligible Class shall become an
Active Participant on the earliest date as of which he has both
completed one year of Continuous Service and attained his 21st Birthday.
An Active Participant shall cease to be an Active Participant on the
date on which he ceases to be a Member Of The Eligible Class.
2.5 Vested Participant. An Active Participant shall become a Vested
Participant on the earlier to occur of the following two dates:
(a) the date the Active Participant completes 5 years of
Continuous Service.
(b) the Active Participant's 65th Birthday.
2.6 Disabled Participant. An Active Participant who ceases to be an Active
Participant on account of a disability, the onset of which occurs when
he is an Active Participant with two or more years of Continuous Service
but prior to his Earliest Benefit Commencement Date, pursuant to which
he becomes entitled to receive disability benefits under the Federal
Social Security Act within one year of the date of the onset of his
disability, shall become a Disabled Participant on the first day of the
month following the sixth monthly anniver-
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sary of the onset of his disability. A Disabled Participant shall cease
to be a Disabled Participant on the date as of which he ceases to be
entitled to receive disability benefits under the Federal Social Security
Act if such date is prior to his Normal Retirement Date, otherwise on the
date of his death. A person who ceases to be a Disabled Participant prior
to his Normal Retirement Date other than by death shall be deemed to have
been on an authorized leave of absence granted by an Affiliated
Corporation (hereinafter a "Disability Leave") for the period beginning
on the date of the onset of his disability and ending on the earlier to
occur of the first day of the month coincident with (next following, if
none coincides with) the first anniversary of the onset of his disability
and the date he ceased to be a Disabled Participant. If a person who
ceases to be a Disabled Participant prior to his Normal Retirement Date
again becomes a Member Of The Eligible Class within the twelve-month
period following the month in which he ceased to be a Disabled
Participant, he shall thereupon become an Active Participant and he shall
retain the Continuous Service he has at that time. Otherwise, it shall be
deemed that he ceased to be an Active Participant at the expiration of
his Disability Leave.
2.7 Inactive Participant. An Active Participant who is not a Vested
Participant
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who ceases to be an Active Participant other than by death shall become
an Inactive Participant. An Inactive Participant shall cease to be an
Inactive Participant on the earliest to occur of the following four
dates:
(a) the date of his death.
(b) the date the Inactive Participant again becomes an Active
Participant.
(c) the date he completes 5 years of Continuous Service, in which event
he shall thereupon become a Vested Participant.
(d) the date his Continuous Service is disregarded pursuant to Section
1.9.
2.8 "Normal Retirement Age" shall mean the individual's 65th Birthday.
2.9 "Normal Retirement Date" shall mean the first day of the month following
the month which includes the individual's Normal Retirement Age.
2.10 "Earliest Benefit Commencement Date" shall mean the earlier of:
(a) the Active Participant's Normal Retirement Date, and
(b) the first day of the month following the month in which the Active
Participant has both attained his 60th Birthday and completed 10 years of
Continuous Service (5 years if the individual was employed by an
Affiliated Corporation on December 1, 1989).
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HANDY & HARMAN PENSION PLAN
Article 3A
DEFINITIONS FOR COMPUTATION OF ACCRUED BENEFIT
Plan As In Effect At Handy & Harman
(For Plan purposes also referred to as "Handy & Harman")
3.1 "Benefit Service" shall be equal to Continuous Service except that
Benefit Service shall not include any period prior to September 9, 1983
with the Improved Laminated Metals Division of Krementz & Co.
3.2 "Expected Monthly Normal Retirement Pension" shall mean for an Active
Participant on any given date the larger of (a) and (b), where:
(a) equals the sum of
(i) 38.75% of such Active Participant's Average Monthly Basic
Pay, and
(ii) 11.25% of such Average Monthly Basic Pay in excess of
$833.33, if any, with such sum multiplied in the case of an Active
Participant whose Expected Period Of Benefit Service At Normal
Retirement Date is less than 25 years by a percentage equal to 4%
multiplied by his Expected Period Of Benefit Service At Normal
Retirement Date, and
(b) equals $12.50 multiplied by such Active Participant's Expected
Period Of Benefit Service At Normal Retirement Date, plus $1.50
multiplied by such Expected Period of Benefit Service At Normal
Retirement Date in excess of 15 years, if any, plus $1.50 multiplied by
such Expected Period Of Benefit
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Service At Normal Retirement Date in excess of 30 years, if any.
3.3 "Accrued Monthly Pension" shall mean for an Active Participant on any
given date the product of (a) and (b) where:
(a) equals such Active Participant's Expected Monthly Normal Retirement
Pension on such given date, and
(b) equals such Active Participant's Service Ratio on such given date,
provided however, that the Accrued Monthly Pension for an Active
Participant on any given date shall in no case be less than the Accrued
Monthly Pension deter mined for him under the Pension Plan on any date
prior to such given date.
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HANDY & HARMAN PENSION PLAN
Article 3
DEFINITIONS FOR COMPUTATION OF ACCRUED BENEFIT
Plan As In Effect At All Participating Companies
3.10 "Pay" shall mean the annual rate of an individual's regular fixed salary
or, in the case of an hourly-paid individual, 2,080 times his regular
fixed hourly wage rate paid by an Affiliated Corporation but shall not
include any amount payable as bonus, commission, overtime premium, shift
differential, reward, prize or any type of compensation other than
regular fixed salary or wage. If the annual rate so computed for an
individual is not an integral multiple of one hundred dollars, his Pay
shall be deemed to be the next higher integral multiple of one hundred
dollars.
3.11A The definition of Basic Pay in this Section 3.11A was in effect for the
period ended November 30, 1992. "Basic Pay" for the period ended
November 30, 1992 shall mean, in and for any Plan Year, an Active
Participant's Pay on either the September 1st preceding the commencement
of such Plan Year if the Active Participant was employed by an
Affiliated Corporation on such September 1st, or the date on which the
Active Participant was employed by an Affiliated Corporation if such
date was subsequent to the September 1st preceding such Plan Year. If an
Active
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Participant whose Continuous Service commenced prior to a given
September 1st does not have a regular fixed salary or regular fixed
hourly wage rate on such September 1st, then his regular fixed salary or
regular fixed hourly wage rate on such September 1st shall be deemed to
be equal to his regular fixed salary or regular fixed hourly wage rate
on the latest date preceding such September 1st as of which he did have
a regular fixed salary or regular fixed hourly wage rate.
3.11B The definition of Basic Pay in this Section 3.11B is effective for the
period starting December 1, 1992. "Basic Pay" for the period starting
December 1, 1992 shall mean, in and for any Plan Year beginning on or
prior to December 1, 1992, an Active Participant's Pay on either the
September 1st preceding the commencement of such Plan Year if the Active
Participant was employed by an Affiliated Corporation on such September
1st, or the date on which the Active Participant became employed by an
Affiliated Corporation if such date was subsequent to the September 1st
preceding such Plan Year. If an Active Participant whose Continuous
Service commenced prior to a given September 1st does not have a regular
fixed salary or regular fixed hourly wage rate on such September 1st,
then his regular fixed salary or regular fixed hourly wage rate on such
September 1st shall be deemed to be equal to his regular fixed salary or
regular fixed hourly wage rate on the latest date preceding such
September 1st as of which he did have a regular fixed salary or regular
fixed hourly wage rate.
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"Basic Pay" shall mean, in and for any Plan Year, beginning on or after
January 1, 1993, an Active Participant's Pay on either the January 1st
on which such Plan Year commenced if the Active Participant was employed
by an Affiliated Corporation on such January 1st, or the date on which
the Active Participant was employed by an Affiliated Corporation if such
date was subsequent to the January 1st on which such Plan Year
commenced. If an Active Participant whose Continuous Service commenced
prior to a given January 1st does not have a regular fixed salary or
regular fixed hourly wage rate on such January 1st, then his regular
fixed salary or regular fixed hourly wage rate on such January 1st shall
be deemed to be equal to his regular fixed salary or regular fixed
hourly wage rate on the latest date preceding such January 1st as of
which he did have a regular fixed salary or regular fixed hourly wage
rate.
3.12 Limitation on Pay. For each Plan Year beginning after 1988, the Basic
Pay or annual compensation of each participant taken into account under
the Plan for any year shall not exceed Two Hundred Thousand Dollars
($200,000) (One Hundred Fifty Thousand Dollars ($150,000) for 1994),
provided that the Commissioner of the Internal Revenue Service shall
adjust the amount as of January 1 of each calendar year commencing with
January 1, 1990. The adjusted limit shall be effective for any Plan Year
beginning in such calendar year except that such adjusted limit for each
calendar year through December 31, 1993 shall also apply to prior
calendar years for purposes of performing Plan calculations in the
calendar year of such adjustment. In addition, if the Plan determines
compensation for fewer than twelve
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(12) calendar months, the limit for the short period shall equal the annual
compensation limit for the calendar year in which the compensation period begins
multiplied by the fraction the numerator of which is the total number of months
in the period and the denominator of which is twelve (12). This limit applies to
the combined compensation of the participant and any family member aggregated
with the participant. The family members of a participant who are aggregated
with a participant for purposes of this limitation are the participant's spouse
and the participant's lineal descendants who are under age 19. If this $200,000
limitation applies to a participant and one or more of his family members, the
limitation will be prorated among them in proportion to their total
compensations in applying the contribution and allocation provisions of this
Plan. For each Plan Year beginning prior to 1989, this $200,000 limitation will
apply only if the Plan is top heavy, but the family aggregation rule will not
apply. For Plan Years beginning after 1993, $150,000 shall be substituted for
$200,000 throughout this paragraph, and the $150,000 compensation limit shall be
adjusted by the Commissioner for increases in the cost of living in accordance
with Section 401(a)(17)(B) of the Internal Revenue Code.
A "statutory 401(a)(17) employee" means an employee whose current Accrued
Monthly Pension as of any date on or after December 1, 1989 is based on an
amount of Basic Pay for a Plan Year beginning on or prior to December 1, 1988
that exceeded $200,000.
The Accrued Monthly Pension of each statutory 401(a)(17) employee will
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be equal to the greater of the Accrued Monthly Pension determined under (a) or
(b) where:
(a) equals the employee's Accrued Monthly Pension determined under the
benefit formula applicable for the Plan Year beginning on or after
December 1, 1989 as applied to the Active Participant's total years
of Benefit Service, and
(b) is equal to the sum of (i) and (ii) where
(i) the Active Participant's Accrued Monthly Pension as of November
30, 1989 determined under the Plan as in effect on November 30,
1989, frozen in accordance with Regulation 1.401(a)(4)-13 and,
(ii) equals the Active Participant's Accrued Monthly Pension
determined under the benefit formula applicable for the Plan Year
beginning on or after December 1, 1989 as applied to the Active
Participant's years of Benefit Service credited for Plan Years
beginning on or after December 1, 1989,
where all such calculations are determined under the benefit formula in
that Section 3.3 of the Plan that is applicable to him.
A "section 401(a)(17) employee" means an employee whose current Accrued Monthly
Pension as of any date on or after January 1, 1994 is based on an amount of
Basic Pay for a Plan Year beginning on or prior to January 1, 1993 that exceeded
$150,000.
The Accrued Monthly Pension of each section 401(a)(17) employee will be equal to
the greater of the Accrued Monthly Pension determined under (a) or (b) where:
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(a) equals the employee's Accrued Monthly Pension determined under the
benefit formula applicable for the Plan Year beginning on or after
January 1, 1994 as applied to the Active Participant's total years
of Benefit Service, and
(b) is equal to the sum of (i) and (ii) where
(i) the Active Participant's Accrued Monthly Pension as of
December 31, 1993 determined under the Plan as in effect on
December 31, 1993, frozen in accordance with Regulation
1.401(a)(4)-13 and,
(ii) equals the Active Participant's Accrued Monthly Pension
determined under the benefit formula applicable for the Plan
Year beginning on or after January 1, 1994 as applied to the
Active Participant's years of Benefit Service credited for
Plan Years beginning on or after January 1, 1994,
where all such calculations are determined under the benefit formula in
that Section 3.3 of the Plan that is applicable to him.
3.13A The definition of Average Monthly Basic Pay in this Section 3.13A was in
effect for the period ended November 30, 1992. "Average Monthly Basic
Pay" for the period ended November 30, 1992 shall mean for an Active
Participant in and for any Plan Year one-twelfth of the average of his
Basic Pay during those five consecutive Plan Years out of the ten Plan
Years ending with such Plan Year for which the sum of his Basic Pay for
such five consecutive Plan Years is the largest; provided, however, that
if there are not at least five consecutive Plan Years as to which
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Basic Pay is defined for the Active Participant, Average Monthly Basic
Pay for such Active Participant shall be equal to the average of his
Basic Pay for those consecutive Plan Years for which Basic Pay is
defined for him.
3.13B The definition of Average Monthly Basic Pay in this Section 3.13B is
effective for the period starting December 1, 1992. "Average Monthly
Basic Pay" for the period starting December 1, 1992 shall mean for an
Active Participant in and for any Plan Year one-twelfth of the average
of his Basic Pay during all his Plan Years beginning with the Plan Year
commencing on January 1, 1993 provided that at least five Plan Years
will be included in such average except that if there are not at least
five Plan Years as to which Basic Pay is defined for the Active
Participant, Average Monthly Basic Pay for such Active Participant shall
be equal to the average of his Basic Pay for all those Plan Years for
which Basic Pay is defined for him, and further provided that if such
Active Participant has any period of consecutive Plan Years beginning on
or after December 1, 1983 that includes the same number of Plan Years
that is included in his Average Monthly Basic Pay which results in a
larger amount of Average Monthly Basic Pay such larger Average Monthly
Basic Pay will be reflected in his calculation. In all cases if Basic
Pay for the January 1, 1993 through December 31, 1993 Plan Year is
included in his Average Monthly Basic Pay, then Basic Pay for the
December 1, 1992 through December 31, 1992 Plan Year will be excluded
from such Average.
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3.14 "Benefit Service", except as otherwise provided in Section 3.1, shall be
equal to Continuous Service except that in the case of any individual
who is an employee of any company (or a division, location or other part
of any company) that is acquired by any Affiliated Corporation after
December 31, 1982 and who is employed by the company on such acquisition
date, Benefit Service shall not include any period prior to the date of
acquisition unless otherwise specifically provided for by the Board of
Directors.
3.15 "Expected Period of Benefit Service At Normal Retirement Date" shall
mean for an Active Participant on any given date the greater of (a) and
(b) where:
(a) is equal to the sum of:
(i) his Benefit Service on the first day of the month
coinciding with (next preceding, if none coincides with)
such given date, and
(ii) the number of years, to the nearer one-twelfth of a year,
from such first day of the month to such Active
Participant's Normal Retirement Date, and
(b) is applicable only to an individual who is an Active Participant
after his Normal Retirement Date and is equal to his actual Benefit
Service on the given date.
3.16 "Service Ratio" shall mean for an Active Participant on any given date
3-8
27
the ratio
of:
(a) his Benefit Service on such given date, to
(b) his Expected Period Of Benefit Service At Normal Retirement Date,
provided that such ratio shall not be greater than 1.0000.
3-9
28
HANDY & HARMAN PENSION PLAN
Article 4A
BENEFITS FOR PARTICIPANTS, THEIR SURVIVING SPOUSES AND BENEFICIARIES
Plan As In Effect At Handy & Harman
(For Plan purposes also referred to as "Handy & Harman")
4.1 Normal Retirement Pension. Each Vested Participant who ceases to be an
Active Participant on or after his Normal Retirement Date will receive a
monthly Normal Retirement Pension beginning on the first day of the
month coincident with (next following, if none coincides with) the date
he ceases to be an Active Participant.
The amount of Normal Retirement Pension for a Vested Participant who is
not married at the time his pension commences shall be the greater of
(a) and (b), where (a) equals his Accrued Monthly Pension determined on
his Normal Retirement Date, increased, if the Active Participant ceases
to be an Active Participant after his Normal Retirement Date, by 3/4%
for each month in the period starting on his Normal Retirement Date and
ending on the earlier of last day of the month in which he ceased to be
an Active Participant and March 1, 1988 and (b) equals his Accrued
Monthly Pension determined on the first day of the month coincident with
(next following, if none coincides with)
4A-1
29
the date he ceases to be an Active Participant. Such pension shall be
payable as a Ten Years Certain And Life Thereafter Pension.
The Normal Retirement Pension for a Vested Participant who is married at
the time his pension commences shall be payable as a 50% Joint And
Survivor Pension in an amount equal to the Actuarial Equivalent of the
pension amount the Participant would receive if he is not married at the
time his pension commences.
4.2 Disability Retirement Pension. Each Active Participant who becomes a
Disabled Participant will receive a Disability Retirement Pension
beginning on the date he becomes a Disabled Participant, and ending on
the first day of the month coincident with (next preceding, if none
coincides with) the date he ceases to be a Disabled Participant.
The following paragraph was in effect for the period through November
30, 1990.
The amount of Disability Retirement Pension for a Disabled Participant
who is not married at the time his pension commences shall be equal to
30% of his Average Monthly Basic Pay determined as of the date he ceases
to be an Active Participant, multiplied, if the Expected Period of
Benefit Service at Normal Retirement Date for him on the date he ceases
to be an Active Participant is
4A-2
30
less than 25 years, by a percentage equal to 4% times such Expected
Period of Benefit Service at Normal Retirement Date. Such pension shall
be payable as a Ten Years Certain and Life Thereafter Pension.
The following paragraph is effective for the period starting December
1, 1990.
The amount of Disability Retirement Pension for a Disabled Participant
who is not married at the time his pension commences shall be equal to
the larger of (a) and (b) below, where:
(a) equals the Active Participant's Accrued Monthly Pension on that
date he ceases to be an Active Participant, and
(b) equals 70% of the Active Participant's Expected Monthly Normal
Retirement Pension on the date he ceases to be an Active
Participant based on his Average Monthly Basic Pay on the date he
ceases to be an Active Participant.
Such pension shall be payable as a Ten Years Certain and Life
Thereafter Pension.
The Disability Retirement Pension for a Disabled Participant who is
married at the time his pension commences shall be payable as a 50%
Joint And Survivor Pension in an amount equal to the Actuarial
Equivalent of the pension amount the Participant would receive if he is
not married at the time his pension commences.
4A-3
31
4.3 Early Retirement Pension. Each Vested Participant who ceases to be an
Active Participant other than by death prior to his Normal Retirement
Date but on or after his Earliest Benefit Commencement Date shall be
eligible to receive an Early Retirement Pension. Such pension shall
commence on the first day of the month coincident with (next following,
if none coincides with) the date he ceases to be an Active Participant.
The amount of Early Retirement Pension for a Vested Participant who is
not married at the time his pension commences shall be equal to his
Accrued Monthly Pension on the date he ceases to be an Active
Participant. Such pension shall be payable as a Ten Years Certain And
Life Thereafter Pension.
The Early Retirement Pension for a Vested Participant who is married at
the time his pension commences shall be payable as a 50% Joint And
Survivor Pension in an amount equal to the Actuarial Equivalent of the
pension amount the Participant would receive if he is not married at the
time his pension commences.
4.4 Deferred Vested Pension. Each Vested Participant who is not entitled to
a pension pursuant to Section 4.1, 4.2 or 4.3 of this Article 4A on the
date he ceases to be an Active Participant shall be eligible for a
Deferred Vested
4A-4
32
Monthly Pension. Such pension shall begin on:
(a) the Vested Participant's Normal Retirement Date, or
(b) the first day of any month elected by the Vested Participant which
is on or after his Earliest Benefit Commencement Date and on or
after the day on which he makes his election but prior to his
Normal Retirement Date.
If such Vested Participant is not married at the time his pension
commences, the amount of his pension shall be equal to a percentage of
his Accrued Monthly Pension on the date he ceases to be an Active
Participant. Such percentage shall be equal to 100%, minus 5/9th's of
1% for each month in the period beginning with the date his pension
commences and ending on his Normal Retirement Date. Such pension shall
be payable as a Ten Years Certain And Life Thereafter Pension.
If such Vested Participant is married at the time his pension
commences, the amount of his pension shall be payable as a 50% Joint
And Survivor Pension in an amount equal to the Actuarial Equivalent of
the pension amount the Participant would receive if he is not married
at the time his pension commences.
Single Sum Option for Deferred Vested Pension. Each Vested Participant
who becomes eligible for a Deferred Vested Monthly Pension pursuant to
4A-5
33
this Section 4.4 may, within 30 days of the date he ceases to be in the
employment of an Affiliated Corporation, elect to receive, in lieu of
and in complete substitution for the benefits otherwise payable to him
or on his account, the single sum payment that is the Actuarial
Equivalent to the initial amount of monthly pension the Participant
would have been entitled to receive commencing on his Normal Retirement
Date if he were not married at that time, provided that effective
January 1, 1985, if the Participant is married and the amount of the
lump sum is more than $3,500., his spouse must consent to such
election. The Single Sum Option is eliminated for any increase in
benefits after October 31, 1992. The Single Sum Option is preserved for
the amount of Accrued Monthly Pension determined as of October 31, 1992
under the Plan as in effect on October 31, 1992.
4.5 Pre-retirement Spouse Pension. In the case of:
(a) a Vested Participant who ceases to be an Active Participant by
death on or after his Earliest Benefit Commencement Date, or
(b) a Vested Participant who ceases to be an Active Participant by
death prior to his Earliest Benefit Commencement Date but after
August 23, 1984, or,
(c) a former employee who ceased to be in the employment of an
Affiliated Corporation on or after December 1, 1976 whose death
occurs on or
4A-6
34
after August 23, 1984 and who at the time of his death is entitled to a
deferred vested pension benefit that has not commenced prior to the
date of his death;
Then a Pre-retirement Spouse Pension will be payable to the surviving
spouse of the Participant or former employee if the surviving spouse
was married to the Participant or former employee for the entire one
year period ending on the date of death.
The monthly pension to the surviving spouse will commence on the
Earliest Benefit Commencement Date of the Active Participant or former
employee, or the first day of the month coincident with (next
following, if none coincides with) the date of death if later, if the
spouse survives to that date and will cease on the first day of the
month in which the spouse's death occurs.
The amount of pension payable to the surviving spouse will be the
amount that would have been payable to the surviving spouse if the
Active Participant or former employee had his pension payable as a 50%
Joint and Survivor Pension and:
(a) in the case of an Active Participant whose death occurs on or after
his Earliest Benefit Commencement Date, the Active Participant
retired on his date of death, or
4A-7
35
(b) in the case of an Active Participant whose date of death was prior
to his Earliest Benefit Commencement Date, the Active Participant
terminated his employment for a reason other than death, survived
to his Earliest Benefit Commencement Date and had his pension
commence at that date, or
(c) in the case of a former employee whose death occurs on or after his
Earliest Benefit Commencement Date, the former employee had his
pension commence on the date of his death, or
(d) in the case of a former employee whose date of death was prior to
his Earliest Benefit Commencement Date, the former employee
survived to his Earliest Benefit Commencement Date and had his
pension commence at that date.
In each case where the calculation of the benefit to the surviving
spouse reflects a reduction on account of the early commencement of the
pension the spouse may elect prior to the date of the first pension
payment on a form authorized by the Committee, to defer the commencement
of the Pre-retirement Spouse Pension to the earliest date when such a
reduction for early commencement would not be applied.
4.6 Post-Retirement Single Sum Death Benefits. At the death of a former
Active Participant, who, at the time of his death, was receiving a
pension
4A-8
36
pursuant to Section 4.1 or 4.3 of this Article 4A or was receiving a
Disability Retirement Pension pursuant to Section 4.2 on account of a
disability which had its onset after his 60th Birthday, a single sum
death benefit in the amount of $2,500 shall be paid to his beneficiary.
4.7A Cost of Living Increase. Effective on the July 1st following end of the
Plan Year in which a former Active Participant who is receiving pension
payments pursuant to Sub-section 4.1, 4.2, 4.3 or 4.4 of this Article
4A first commenced to receive such payment (such as July 1st for a
given former Active Participant being hereinafter referred to as his
"First CPI Increase Date"), and on each succeeding July 1st thereafter,
the pension amount payable to such former Active Participant will be
increased to an amount equal to the product of:
(a) the initial monthly amount of such former Active Participant's
pension, and
(b) the Cost Of Living Factor then applicable to him.
The Cost Of Living Factor applicable to such a former Active
Participant on any given July 1st shall be equal to Factor A below or
Factor B below whichever is smaller, where:
Factor A equals on such former Active Participant's First CPI Increase
Date the CPI Ratio for that date, and on any succeeding July 1st
4A-9
37
equals Factor A on the preceding July 1st multiplied by the CPI Ratio
for such succeeding July 1st, and
Factor B equals on such former Active Participant's First CPI Increase
Date 1.04 and on any succeeding July 1st equals Factor B on the
preceding July 1st multiplied by 1.04;
provided, however, that in no case will the Cost Of Living Factor
applicable to a former Active Participant be less than 1; and provided
further, however, that in no case will the Cost Of Living Factor
applicable to a former Active Participant decrease.
For purposes of this Section 4.7A: "CPI Index" on any July 1st means
the arithmetic mean average of the Consumer Price Index prepared by the
Labor Department and used for determining Cost of Living Increases
under the Federal Social Security Act for the three months January,
February and March of the calendar year in which such July 1st occurs,
and
"CPI Ratio" on any July 1st means the ratio of:
(a) the CPI Index for such July 1st, to
(b) the CPI Index for the immediately preceding July 1st.
The Cost of Living Increase provision is eliminated for any increase in
benefit after October 31, 1992. The Cost of Living Increase provision
is preserved for the amount of Accrued Monthly Pension
4A-10
38
determined as of October 31, 1992 under the Plan as in effect on
October 31, 1992. Therefore, each Vested Participant who receives a
pension will have his pension based on the greater of (a) his Accrued
Monthly Pension determined as of October 31, 1992 under the Plan in
effect on October 31, 1992 with the Cost of Living Increase and (b) the
Accrued Monthly Pension determined at the date he ceases to be an
Active Participant with no Cost of Living Increase.
4.7B. Each person who received a monthly pension payment from the Handy &
Harman Pension Plan on November 1, 1976, other than any such a person
who at the time he retired was a member of a bargaining unit, shall
continue to receive the benefits determined for him under the
provisions of the Handy & Harman Pension Plan as in effect on the date
he commenced to receive monthly pension payments except that each such
person shall have each monthly pension payment payable to him on and
after July 1, 1989 increased in accordance with this Section 4.7B.
Effective July 1, 1989, the monthly pension of each person described in
the first paragraph of this Section shall be increased by an amount
equal to the greater of (a) and (b) where:
(a) is equal to 4% of the amount of pension such employee received as
of June 1, 1989 and
4A-11
39
(b) is equal to $20.00
Effective July 1, 1990 and on each succeeding July 1st thereafter the
pension payable to such an employee described in the first paragraph of
this Section will be increased to an amount equal to the product of (c)
and (d) where:
(c) is equal to the amount of monthly pension payable to such employee
effective July 1, 1989 and
(d) is equal to the Cost Of Living Factor then applicable to him.
The Cost Of Living Factor applicable to such an employee on any given
July 1st shall be equal to Factor A below or Factor B below, whichever
is smaller, where:
Factor A equals on July 1, 1990, the CPI Ratio for that date and on any
succeeding July 1st equals Factor A on the preceding July 1st
multiplied by the CPI Ratio for such succeeding July 1st, and
Factor B equals on July 1, 1990, 1.04 and on any succeeding July 1st
equals Factor B on the preceding July 1st multiplied by 1.04 provided,
however, that in no case will the Cost Of Living Factor applicable to
such an employee decrease.
If the surviving spouse of an employee described in the first paragraph
of this Section receives a pension on or after July 1, 1989 because of
the joint
4A-12
40
and survivor form of pension elected by the employee, such spouse shall have
the pension otherwise payable to her on or after July 1, 1989 increased in
accordance with this Section 4.7B.
For purposes of this Section 4.7B the "CPI Index" and the "CPI Ratio" will
be as defined in Section 4.7A.
4.8 Each Active Participant who will have attained his 62nd birthday on or
before February 1, 1988 who terminates his employment in the period starting
on December 2, 1987 and ending on February 1, 1988 and who is employed in
New York, Fairfield, El Monte, Elk Grove Village, Attleboro, or East
Providence is entitled to an ERP Pension and an ERP Lump Sum Payment
determined as follows:
(a) The ERP Pension for an eligible Active Participant is equal to his
Accrued Monthly Pension as otherwise calculated under the Plan including the
calculation of the Active Participants' Average Monthly Basic Pay but
reflecting the additional service the participant would have if he continued
as an Active Participant until the latter (i) of his Normal Retirement Date
and (ii) six months after his effective date of retirement (i.e., July 1,
1988 or August 1, 1988 as applicable).
(b) The ERP Lump Sum Payment will be payable upon retirement in an
amount
4A-13
41
equal to the product of (i) x (ii) where
(i) is equal to the Active Participant's Basic Pay at December
1, 1987 divided by 52 and
(ii) is equal to the Active Participant's Benefit Service at
his effective date of retirement with a maximum of 10 years.
4.9 Each Active Participant (a) who is eligible for an Early Retirement Pension
or a Normal Retirement Pension on January 1, 1992, (b) who has at least 10
years of Continuous Service on January 1, 1992, (c) whose job terminates or
is relocated outside of New York city after December 31, 1991 and before
October 2, 1992 and (d) who qualifies for the "Staying Bonus" related to
relocation of New York Office jobs outside of Manhattan is eligible to make
an election under the Early Retirement Plan. The election under the Early
Retirement Plan may be made during the 6 month period ending with the
elimination of the Active Participant's position in the New York city office
of Handy & Harman. The amount of pension for an eligible Active Participant
is equal to his Accrued Monthly Pension as otherwise calculated under the
Plan including the calculation of his Average Monthly Basic Pay except that
an additional 5 years of Benefit Service will be inputted into the
calculation.
4A-14
42
HANDY & HARMAN PENSION PLAN
Article 4
BENEFITS FOR PARTICIPANTS, THEIR SURVIVING SPOUSES AND BENEFICIARIES
Plan As In Effect At All Participating Companies
4.10 Straight Life Pension. A monthly pension payable for the lifetime of the
Participant with no continuation in the event of the Participant's death
after the effective date of the Participant's benefit commencement to the
Participant's spouse or beneficiary.
4.11 Ten Years Certain And Life Thereafter Pension. A monthly pension payable
for the lifetime of the Participant with the further provision that in the
event of the Participant's death after the effective date of the
Participant's benefit commencement and prior to receipt by the Participant
of at least 120 monthly payments such payments shall continue to the
Participant's beneficiary until a total of 120 monthly payments has been
made to the Participant and his beneficiary.
4.12 50% Joint And Survivor Pension. A monthly pension payable for the lifetime
of the Participant with the further provision that if the Participant is
survived by the spouse to whom he was married at the time his pension
commenced, monthly pension payments will be made to such spouse beginning
on the first day of the month following the month in which such Participant
died and
4-1
43
continuing for the remainder of such spouse's lifetime, with the last
monthly pension payment to such spouse to be made on the first day of
the month in which the death of the spouse occurred, and with the
amount of each such monthly pension payment to be made to such spouse
on any given date to be equal to one-half of the pension amount which
such Participant would have received on such date if he had survived to
receive such payment.
4.13 Optional Forms of Pension Benefit. Subject to written notice of the
Participant's election filed with the Committee in such form and manner
as the Committee may determine, and subject to such other requirements
as the Committee may establish and uniformly apply, a Participant
entitled to receive a pension may elect to receive a pension payable in
accordance with one of the following applicable forms of pension:
Option A - Applicable to all Participants - a Straight Life Pension as
described in Section 4.10.
Option B - Applicable to all Participants - a Ten Years Certain And
Life Thereafter Pension as described in Section 4.11.
Option C - Applicable to a Participant who will receive his pension
pursuant to Section 4.1, 4.2 or 4.3 and is married at the time his
pension is to
4-2
44
commence - a 100% Joint And Survivor Pension which provides a reduced
pension for the lifetime of the Participant, with 100% of the reduced
amount payable to the Participant continued thereafter to the spouse he
was married to at his retirement for the remainder of the spouse's
lifetime.
Option D - Any other form of pension payable on a monthly basis that is
approved by the Committee, which option shall thereupon become
uniformly available to all similarly situated Participants.
Such optional form of pension shall be in lieu of and in complete
substitution of all other benefits that the Participant is otherwise
entitled to receive from the Plan; provided, however:
(a) The Committee shall provide each Married Participant no less than
30 days and not more than 90 days prior to the Annuity Starting
Date with a written explanation of the terms and conditions of the
pension provided under Article 4 including the Participant's right
to make and the effect of an election to receive an optional form
of benefit, the rights of the Participant's spouse; the right to
make and the effect of a revocation of a previous election to waive
the pension; and the amounts of the optional forms of benefit
available to the Participant under the Plan.
(b) The election by a Participant of Option A, B or D shall not be
effective unless (1) within ninety (90) days preceding the Annuity
Starting Date the Participant's spouse
4-3
45
irrevocably consents in writing to the Participant's election and
to the naming of a specific non-spouse beneficiary (including any
class of beneficiaries or contingent beneficiaries); (ii) the terms
of such consent acknowledge the effect of the waiver; (iii) the
consent is witnessed by a representative of the Committee or
acknowledged before a notary public; and (iv) the election
designates a form of payment which may not be changed without
spousal consent. The provisions of this paragraph shall not be
applicable if the Committee is satisfied that the required consent
cannot be obtained because the Participant does not have a spouse;
because the spouse cannot be located; or because of such other
circumstances as the Secretary of the Treasury may prescribe by
regulations. Any consent by a spouse or the establishment that the
consent of a spouse cannot be obtained shall only be effective with
respect to such spouse.
(c) If the Participant elects before the Annuity Starting Date a form
of joint and survivor pension under Option C that satisfies the
requirements of this Section 4.13 and dies before the Annuity
Starting Date, that elected Option will be treated as the
Pre-retirement Spouse Pension in substitution for the
Pre-retirement Spouse Pension otherwise provided by the Plan.
4-4
46
(d) If distributions commence on or after January 1, 1988 in the form
of a joint and survivor annuity for the joint lives of the
Participant and a nonspouse beneficiary, annuity payments to be
made on or after the Participant's required beginning date to the
designated beneficiary after the Participant's death must not at
any time exceed the applicable percentage of the annuity payment
for such period that would have been payable to the Participant
using the table set forth in Q&A-A6 of section 1.401(a)(9)-2 of the
Proposed Income Tax Regulations.
(e) If distributions commence prior to January 1, 1988 in the form of a
joint and survivor annuity for the joint lives of the Participant
and a nonspouse beneficiary, the present value of annuity payments
to be made to the designated beneficiary after the Participant's
death must not exceed 50% or more of the present value of the
benefits payable to both the Participant and his beneficiary.
(f) No pension with a period certain for a period extending beyond the
life expectancy on the benefit commencement date of the Participant
and his beneficiary may be elected.
(g) All options will be subject to the provision of any insurance or
annuity contract which provides all or part of the benefit payable
under the Plan to any Participant to the extent consistent with the
terms of this Plan.
4-5
47
(h) If the single sum amount which is the Actuarial Equivalent of the
Participant's (or surviving spouse's) pension, as applicable, is
$3,500 or more, no lump sum payment will be made from the Plan
except as otherwise explicitly provided in this Plan.
(i) If a pension has already commenced to a Participant and/or spouse,
as applicable, no lump sum payment will be made from the Plan.
The amount of any pension payable in accordance with an option provided
in this Section shall be the Actuarial Equivalent of the pension that
would otherwise be payable to the Participant if he was not married on
his benefit commencement date and if no option had been elected.
4.14 Small Amounts. If the lump sum amount which is the Actuarial Equivalent
of the monthly benefit payable to any Participant or surviving spouse
from this Plan and all other defined benefit plans of an Affiliated
Corporation is less than $3,500. ($2,500 for determinations effective
on or after December 1, 1985 but prior to September 1, 1988 and $1,750.
for determinations effective prior to December 1, 1985), such lump sum
shall be distributed in lieu of the monthly benefit.
4-6
48
4.15 Postponed Retirement. A Participant may continue in the employ of an
Affiliated Corporation beyond such Participant's Normal Retirement Date. In
such event, no pension shall be payable to such Participant until the
Participant's Postponed Retirement Date, which shall be the earlier of (a)
the first day of the month coincident with or next following the date of
the Participant's actual retirement, or (b) the first day of the month in
which the Participant's employment ceases to be substantial. For this
purpose, a Participant's employment will be substantial if the Participant
renders ten (10) days (or separate work shifts) in a calendar month. Each
Participant who is on Postponed Retirement shall receive from the Committee
the notice required by Section 4.18.
A Participant who retires on a Postponed Retirement Date, shall receive,
commencing on the Participant's Postponed Retirement Date, the pension
calculated pursuant to Section 4.1 based on the Participant's Postponed
Retirement Date.
4.16 Mandatory Commencement of Persons While Still Employed. Distribution of a
Participant's entire interest will commence not later than the April 1st
following the calendar year in which the Participant attains age 70-1/2 or,
in the case of an employee other than a 5% owner (as described in Code
Section 416(i)) who attained age 70 1/2 prior to January 1, 1988, the April
1st following the calendar year in which the Participant retires, if
4-7
49
later.
The monthly benefit payable to a Participant shall reflect the
Participant's Accrued Monthly Pension determined as of the April 1st
following the calendar year in which the Participant attains age 70-1/2 and
shall be adjusted effective on the January 1 following the calendar year in
which the Participant's benefit payments commence and on each succeeding
January 1 that the Participant remains actively employed, to reflect the
effect of changes in the Participant's Accrued Monthly Pension since the
previous January 1. The final adjustment shall be made as of the
Participant's Postponed Retirement Date. Adjustments required by this
paragraph shall include a reduction equal to the Actuarial Equivalent of
benefit payments already made to the Participant. In no event, however,
shall the benefit payable to the Participant be reduced as a result of this
paragraph. Determination of monthly benefit payments under this paragraph
shall end with the payment made for the month in which occurs the
Participant's Postponed Retirement Date or date of death if earlier. The
date of the first payment to the Participant will be the Participant's
Annuity Starting Date and any optional form of pension elected under
Section 4.13 will be elected as of that date and will remain in effect.
4.17 Suspension of Benefits.
If a Participant resumes employment, and if such employment is substantial
as defined in Section 4.15, his pension shall be suspended during each
calendar month of such employment. Upon his subsequent
4-8
50
retirement, his pension shall be recomputed, based on his Accrued Monthly
Pension accrued pursuant to Section 3.3 for his Benefit Service prior and
subsequent to such return to employment and his then attained age, and
reduced on an actuarial basis to take account of payments previously
received by him. Such recomputation and adjustment shall be to the extent
permitted by law. The Committee shall establish procedures which are
consistent with Department of Labor Regulation Section 2530.203-3,
including, but not limited to, procedures for the resumption of benefits
and the offsetting of benefit overpayments, if any, hereunder.
4.18 Notice of Suspension of Benefits.
The Committee shall prepare and deliver, to each Participant whose pension
is deferred pursuant to Section 4.15, or suspended pursuant to Section
4.17, a notice containing: (a) a description of the specific reasons for
the deferral or suspension of benefit payment; (b) a general description of
the Plan provisions relating to the deferral or suspension; (c) a copy of
such provisions; (d) a statement to the effect that applicable Department
of Labor regulations may be found in Section 2530.203-3 of the Code of
Federal Regulations; and (e) a description of the Plan's claims procedures.
Such notice shall be furnished to the Participant by personal delivery or
first class mail during the calendar month in which occurs his Normal
Retirement Date if his benefits are being deferred pursuant to Section
4.15, or during the first calendar month in which his benefits are
suspended pursuant to Section 4.17, whichever is applicable.
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51
4.19 Direct Rollovers (Effective January 1, 1993).
Notwithstanding any provision of the Plan to the contrary that would
otherwise limit a distributee's election under this Plan, a distributee may
elect, at the time and in the manner prescribed by the Committee, to have
any portion of an eligible rollover distribution paid directly to an
eligible retirement plan specified by the distributee in a direct rollover.
For purposes of this Section 4.19 the following definitions apply:
"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
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 includible in gross income.
"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 defined contribution plan described in Section
401(a) of the Code, that
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52
accepts that 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.
"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.
"Direct Rollover" is a payment by the plan to the eligible retirement plan
specified by the distributee.
4.20 Deemed Cash Out. If a Participant terminates service, and the present value
of the Participant's vested accrued benefit derived from employer and
employee contributions is not greater than $3,500, the Participant shall
receive a distribution of the present value of the entire vested portion of
such accrued benefit and the nonvested portion will be treated as a
forfeiture. For purposes of this section, if the present value of a
Participant's vested accrued benefit is zero, the Participant shall be
deemed to have received a distribution of such vested accrued benefit.
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53
If a Participant receives or is deemed to receive a distribution pursuant
to this section and the Participant resumes covered employment under the
Plan, he or she shall have the right to restore his or her employer-derived
accrued benefit (including all optional forms of benefits and subsidies
relating to such benefits) to the extent forfeited upon the repayment to
the Plan of the full amount of the distribution plus interest, compounded
annually from the date of distribution at the rate determined for purposes
of Section 411(c)(2)(C) of the Code. Such repayment must be made before the
earlier of five years after the first date on which the participant is
subsequently reemployed by the employer, or the date the participant incurs
5 consecutive 1-year breaks in service following the date of distribution.
4.21 Nonduplication Of Benefits - Transfer Provision. Any benefit payable under
this Pension Plan to or on account of a former Active Participant who was
in the employment of an Affiliated Corporation other than the Participating
Company prior to becoming an Active Participant shall be reduced by the
amount of any pension benefit or death benefit or benefits of a similar
nature, whether or not deferred, which are payable from
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54
a qualified pension, profit sharing, or annuity plan maintained by such
Affiliated Corporation.
Any benefit payable under this Pension Plan to or on account of a former
Active Participant who was an Active Participant at the time his employment
with a Participating Company terminated shall be reduced by the amount of
any benefit payable from any qualified pension plan, other than this
Pension Plan, maintained by that Participating Company.
If a person who terminated his employment with an Affiliated Corporation
and received benefits as either a lump sum or in monthly payments, from any
qualified retirement plan of an Affiliated Corporation subsequently becomes
an Active Participant under the Plan and his prior period of service is
included under this Plan for purposes of calculating the amount of his
benefit, then the benefit otherwise payable from this Plan will be reduced
by the Actuarial Equivalent of the benefits he received prior to his
reemployment date.
4.22 Commencement Date of Pensions.
Unless the Participant, surviving spouse or other beneficiary as applicable
elects otherwise, payment of benefits shall begin no later than 60 days
following the end of the Plan Year in which occurs the later of:
(a) the Participant's 65th Birthday, or
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(b) the Participant's actual termination of employment.
The Committee shall inform the Participant or the Participant's spouse as
applicable of the right to defer any distribution of the Participant's
Accrued Monthly Pension until the Participant's Normal Retirement Date
unless the present value of Participant's pension is payable under Section
4.14 Small Amounts.
4.23 A Vested Participant shall not forfeit any portion of his Accrued Monthly
Pension for cause.
4.24 At the death of a former Active Participant who, at the time of his death,
was receiving a pension, his remaining interest under the Plan, if any,
will be distributed at least as rapidly as under the form of payment in
effect at the Participant's death.
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HANDY & HARMAN PENSION PLAN
Article 5
CONTRIBUTIONS
5.1 The Company shall pay directly to and under the Pension Trust all
contributions to provide or purchase the benefits of the Pension Plan. The
amount of such contributions to be made by the Company in and for any Plan
Year shall be the amount determined by the Board of Directors, or by any
person or party authorized by the Board of Directors. For the purposes of
such determination, the Board of Directors and such authorized person or
party may rely upon any actuarial valuations and recommendations made by any
individual or firm or department appointed by the Committee and qualified to
act as the consulting actuary for the Pension Plan.
5.2 Forfeitures arising hereunder shall not increase the benefit of any
Participant, but shall be applied to reduce future Company contributions to
the Pension Plan.
5.3 Employees shall not make contributions to this Pension Plan. If any
amendment to the Pension Plan shall require any contributions from any
employees or class of employees, such amendment shall not become effective
until after the expiration of the Plan Year in which the amendment is
adopted by the Board of Directors.
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57
5.4 All reasonable expenses incurred in connection with the administration of
the Plan, including but not limited to the compensation and reimbursement of
expenses of the accountant, actuary, investment counsel, legal counsel,
Trustee, or other person who shall be employed in connection with the
administration thereof, shall be paid from the Pension Trust to the extent
not paid by the Company.
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HANDY & HARMAN PENSION PLAN
Article 6
PENSION TRUST
6.1 The Pension Trust shall form a part of the Pension Plan.
6.2 The Pension Trustee shall be the person or persons or party or parties
appointed by the Board of Directors to serve at its pleasure and shall have
the exclusive authority and discretion to manage and control Pension Plan
assets.
6.3 The Pension Trust shall be evidenced by a pension trust agreement, and all
subsequent amendments, made and executed by and between the Company and the
Pension Trustee. The Pension Trust shall contain such terms and conditions
as may be agreed upon from time to time between the Company and the Pension
Trustee, subject to the provisions of Section 6.4 hereof. In the event more
than one Pension Trustee is appointed, the Trustees shall make such rules
for the conduct of their business as they may deem appropriate.
6.4 It shall be impossible at any time prior to the satisfaction of all
liabilities with respect to Participants, beneficiaries and surviving
spouses under the Trust, for any part of the corpus or income, to be used
for, or diverted to, purposes other than for the exclusive benefit of
Participants, beneficiaries and surviving spouses, provided that nothing
herein shall be deemed to prevent the return of any
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employer contribution (a) resulting from a mistake of fact, (b) conditioned
upon initial qualification of the Pension Plan under Section 4O1(a) of the
Code, or (c) conditioned upon deductibility under Section 4O4 of the Code,
within one year after the date of (a) payment of the contribution, (b) the
denial of initial qualification, or (c) the disallowance of the
contribution, respectively.
6.5 The Pension Trustee shall have the power to obtain such outside advice and
assistance as he may deem appropriate in the performance of his duties, and
to delegate such of his responsibilities, other than his responsibility to
manage and control Pension Plan assets, to such person or persons he may
deem appropriate.
6.6 The Pension Trustee shall have the power to appoint one or more investment
managers to manage all or any part of the assets of the Pension Plan, and
upon such appointment, the Pension Trustee shall not be under any obligation
to invest or manage any asset subject to the management of such investment
manager and shall have no liability for the acts or omissions of such
investment manager.
6.7 The Pension Trustee shall have no liability hereunder except by reason of
failure to discharge his duties hereunder solely in the interest of
Participants and beneficiaries and surviving spouses thereof in accordance
with the
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60
Pension Plan documents, with the care, skill, prudence and diligence under
the circumstances then prevailing that a prudent man acting in a like
capacity and familiar with such matters would use in the conduct of an
enterprise of a like character and with like aims.
6.8 In the event more than one Pension Trustee is appointed, such Trustees shall
have the power to allocate their responsibilities hereunder among themselves
in any manner they deem appropriate, by a written agreement signed by all
the Trustees. A copy of any such agreement shall be delivered to the
Administrative Committee and to the Secretary of the Company. In the event
they should so a1locate their duties among themselves, each Pension Trustee
shall be responsible only for those duties specifically allocated to him and
for those duties not specifically allocated to any other Pension Trustee.
6.9 The Pension Trustee shall serve without compensation if he is otherwise
compensated by the Company; however, in the event the Company does not do so
directly, the Pension Plan may reimburse the Pension Trustee for such
expenses as are actually and properly incurred.
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HANDY & HARMAN PENSION PLAN
Article 7
ADMINISTRATION OF THE PENSION PLAN
7.1 The general operation and administration of this Pension Plan and the
authority for carrying out the provisions hereof shall be placed in a
Committee which shall be called the Handy & Harman Pension Plan
Administrative Committee and such Committee shall be the named fiduciary for
the administration of the Pension Plan.
7.2 The Committee shall consist of not less than three individuals who shall be
appointed from time to time by the Board of Directors to serve at the
pleasure of the Board of Directors.
7.3 The Committee may appoint one of its number to act as its chairman, and may
appoint a secretary who need not be one of its number.
7.4 The Committee may employ such outside assistants and advisors in the
performance of its duties as it may deem helpful and, in its sole
discretion, may delegate to another person or persons the responsibility of
carrying out such of its duties hereunder as it may deem appropriate. The
Committee, by a written instrument signed by all individuals then on the
Committee, may delegate to any individual or individuals, who need not be
one of its number, the power to
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62
execute and deliver in the name of and on behalf of the Committee any
written instrument of any type which may be required at any time by any
person or party.
7.5 The Committee may establish rules from time to time for the transaction of
its business and for the administration of the Pension Plan.
7.6 The Committee may maintain, or cause to be maintained, such accounts and
records as it may deem necessary or advisable to properly reflect the
administration of the Pension Plan. Such accounts and records shall be
subject to audit at the close of each Plan Year by the Board of Directors or
by any person or party authorized by the Board of Directors. Each
Participant shall be entitled to examine at any reasonable time any such
account or record directly pertaining to him, but he shall have no right to
examine any account or record directly pertaining to any other person.
7.7 No fee or compensation shall be paid to any individual serving on the
Committee; however, in the event the Company does not do so directly, the
plan may reimburse Committee members for such expenses as they may have
properly and actually incurred.
7.8 No member of the Committee shall be responsible or liable for any act
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63
or omission except for failure to discharge his duties hereunder solely in
the interest of Participants, their beneficiaries, and surviving spouses,
in accordance with Plan documents, with the care, skill, prudence and
diligence under the circumstances then prevailing that a prudent man acting
in a like capacity and familiar with such matters would use in the conduct
of an enterprise of a like character and with like aims.
7.9 The members of the Committee shall have the power to allocate their
responsibilities among themselves in any manner they may deem appropriate,
by a written agreement signed by all the members of the Committee holding
office on the date of such agreement. A copy of any such agreement shall be
delivered to the Secretary of the Company and to the Pension Trustee. In
the event the members of the Committee should so allocate their
responsibilities, each Committee member shall be liable only for those
duties allocated to him and for those duties not specifically allocated to
any other member of the Committee.
7.10 Each Participant, beneficiary or surviving spouse entitled to receive a
benefit hereunder shall submit an application for benefits to the Committee
at 250 Park Avenue, New York, New York, 10177 its principal place of
business.
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64
Applications for benefits must be in writing on the forms prescribed by the
Committee and must be signed by the Participant, or in the case of a death
benefit, by the beneficiary or legal representative of the deceased
participant. The Committee reserves the right to require that the
Participant furnish proof of his age and that of his spouse or co-pensioner,
if any, prior to processing any application.
Each application shall be acted upon and approved or disapproved by the
Committee within sixty days following its receipt by the Committee. In the
event any application for benefits is denied, in whole or in part, the
Committee shall notify the applicant in writing of such denial and of his
right to a review by the Committee and shall set forth in a manner
calculated to be understood by the applicant, specific reasons for such
denial, specific references to pertinent Pension Plan provisions on which
the denial is based, a description of any additional material or information
necessary for the applicant to perfect his application, an explanation of
why such material or information is necessary, and an explanation of the
Pension Plan's review procedure.
Any person, or his duly authorized representative, whose application for
benefits is denied in whole or in part may appeal from such denial to the
Committee for
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65
a review of the decision by submitting to the Committee within one year
after receiving written notice from the Committee of the denial of his claim
a written statement:
(a) Requesting a review of his application for benefits by the
Committee;
(b) Setting forth all of the grounds upon which his request for review
is based and any facts in support thereof; and
(c) Setting forth any issues or comments which the applicant deems
pertinent to his application.
The Committee shall meet to review appeals submitted to it. The Committee
shall act upon each appeal within sixty days after receipt of all data
necessary for its determination by the Committee, or within one hundred and
twenty days under special circumstances.
The Committee may require the Affiliated Corporation or the applicant to
submit such additional facts, documents, or other evidence which the
Committee, in its sole discretion, deems necessary or advisable in making
such a review. On the basis of its review, the Committee shall make an
independent determination of the applicant's eligibility for benefits under
the Pension Plan. The decision of the Committee on any application for
benefits shall be final and conclusive upon all persons.
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66
7.11 Each person with respect to whom benefits from the Pension Plan may be
payable at death shall name a beneficiary to receive any such benefit
(other than a benefit payable to his surviving spouse as such) on a form
furnished by and filed with the Committee. Any such person shall during his
lifetime have the right to change his beneficiary by filing written notice
to that effect with the Committee on a form furnished by the Committee.
Such change shall take effect on receipt of such notice by the Committee.
Any payment made from the Pension Plan prior to the receipt of notice of
change of beneficiary shall to the extent of such payment relieve the
Pension Plan of its obligation.
If benefits are payable from the Pension Plan at the death of a person
(other than a benefit payable to his surviving spouse as such) but no
beneficiary named by the person is surviving to receive the benefits, the
following rules will apply:
(a) If the benefit payable is not in the form of a single sum, periodic
benefits payable shall be commuted to their Actuarial Equivalent.
(b) The benefit shall then be paid in a single sum to the surviving
relatives of such person in the following order: spouse, child or
children in equal parts, mother, father, or if no such relative
survives, then to the executor or administrator of the deceased
person.
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7.12 In the event that it is determined that a person who is entitled to
benefits from the Pension Plan is a minor or is unable to care for his
affairs because of illness, accident, or incompetency, either mental or
physical, unless claim shall have been made therefor by a legally appointed
guardian or other legal representative of such person, any payments due
such person may, but need not, be paid in the sole discretion of the
Committee to an individual or an institution who appears to the Committee
to assume responsibility for the care, custody or support of such person
and such payment shall to the extent thereof release the Pension Plan from
any further obligation or liability.
7.13 Notwithstanding any other provision contained herein, the Committee shall
have the sole and absolute discretion to determine eligibility for benefits
under the Plan and to construe and interpret the provisions of the Plan and
Trust Agreement, including, but not limited to, doubtful or disputed terms,
and to make factual determinations with respect thereto. The decision of a
majority of the then Committee shall govern and control and shall be final
and binding on the Participating Company, the Pension Trustee, each
Participant and beneficiary or surviving spouse thereof and every other
person or party. Such decision may be evidenced by a vote at any meeting at
which a majority of the Committee is present in person or by proxy or such
decision may be evidenced by a written instrument signed by a majority of
the Committee when no meeting is held.
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HANDY & HARMAN PENSION PLAN
Article 8
AMENDMENTS TO THE PENSION PLAN
8.1 The Board of Directors by board resolution shall have the exclusive right at
any time and from time to time (and retroactively if deemed necessary or
appropriate to meet the requirements of Section 401(a) of the Code and of
ERISA and any similar provisions of subsequent revenue or other laws, or the
rules and regulations from time to time in effect under any of such laws or
to conform with governmental regulations or other policies) to modify or
amend in whole or in part any or all of the provisions of the Plan;
provided, however, that no such modification or amendment shall make it
possible for any part of the corpus or income of the Trust Fund to be used
for, or diverted to, purposes other than for the exclusive benefit of
Participants and their joint or contingent annuitants and beneficiaries
under the Plan prior to the satisfaction of all liabilities with respect to
Participants and their joint or contingent annuitants and beneficiaries
under the Plan.
8.2 No amendment to the Plan, including a change in the actuarial basis for
determining optional or early retirement benefits, shall be effective to the
extent that it has the effect of decreasing a Participant's accrued benefit.
Notwithstanding the preceding sentence, a Participant's accrued benefit may
be reduced to the extent permitted under Section 412(c)(8) of the Code. For
purposes of this paragraph, a Plan amendment which has the effect of (1)
eliminating or reducing
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69
an early retirement benefit or a retirement-type subsidy, or (2) eliminating
an optional form of benefit, with respect to benefits attributable to
service before the amendment shall be treated as reducing accrued benefits.
Furthermore, no amendment to the Plan shall have the effect of decreasing a
Participant's vested interest determined without regard to such amendment as
to the later of the date such amendment is adopted, or becomes effective.
8.3 If the Plan's vesting schedule is amended or if the Plan is amended in any
way that directly or indirectly affects the computation of a Participant's
nonforfeitable percentage, each Participant with three (3) or more years of
Continuous Service may elect within a reasonable period of time to have his
vested Accrued Monthly Pension determined under the Plan without regard to
such amendment or change unless such amendment automatically provides that
the higher nonforfeitable percentage will be applied. The period during
which the election may be made shall commence with the date the amendment is
adopted or deemed to be adopted and shall end on the latest of: (a) 60 days
after the amendment is adopted, (b) 60 days after the amendment becomes
effective; or (c) 60 days after the Participant is issued written notice of
the amendment by the Committee.
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HANDY & HARMAN PENSION PLAN
Article 9
TERMINATION OF THE PENSION PLAN
9.1 While the Company intends to continue the Plan indefinitely, nevertheless it
assumes no contractual obligation as to its continuation and the Board of
Directors may terminate or partially terminate the Plan or may discontinue
the participation in the Plan of the employees or any Participating Company
so that after the date of such discontinuance such employees shall accrue no
further benefits under the Plan. If the Plan is terminated or partially
terminated, the affected Participants shall be one hundred percent (100%)
vested in their accrued benefits to the extent then funded.
Upon termination of the Plan, or to determine the level of funding of an
accrued benefit in the event of a partial termination of the Plan, Plan
assets, after payment of all expenses of administration or liquidation,
shall be allocated in accordance with Section 4044 of ERISA provided such
allocation does not result in prohibited discrimination under section
401(a)(4) of the Code. If such allocation does result in prohibited
discrimination, Plan assets may be allocated, at the direction of the
Committee, in any manner acceptable to the Internal Revenue Service and the
Pension Benefit Guaranty Corporation.
Upon termination of partial termination of the Plan, benefits may be
provided through the purchase of annuities or by any other means
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deemed appropriate by the Committee. Solely to the extent required by ERISA,
a Participating Company shall make such additional contributions to the Plan
after the Plan terminates as shall be required by ERISA.
After satisfaction of all accrued liabilities of the Plan with respect to
Participants and their joint and contingent annuitants and beneficiaries
under the Plan, any assets that remain shall be deemed to be the result of
actuarial error and shall be paid to the then Participating Companies in
such proportion as the Committee shall determine.
9.2 The board of directors of any Participating Company shall have the right to
terminate the Plan with respect to its employees and Participants.
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HANDY & HARMAN PENSION PLAN
Article 10
TEMPORARY LIMITATION ON BENEFITS FOR HIGHLY-PAID EMPLOYEES
10.1 Prior to the date the pretermination restrictions in Section 10.3 are
effective, the benefits to be provided to certain participants will be
subject to the limitation set forth in this Section 10.1.
The provisions of this Article 10 shall apply to a Participant who is one
of the twenty-five highest-paid employees of any Participating Company on
any "Commencement Date" whose anticipated benefits under the Pension Plan
at his Normal Retirement Date exceed $1,500 per year. "Commencement Date"
shall mean the effective date of the Pension Plan or any amendment to the
Pension Plan which substantially increases the benefits provided thereby.
In the event that during the first 10 years following a Commencement Date
the Pension Plan is terminated, the amount of the benefits provided under
the Pension Plan for any such Participant shall not be greater than the
benefits that can be provided by the largest of the following amounts:
(a) The contributions (or funds attributable thereto) which would have been
applied to provide the benefit if the Pension Plan as in effect on the
day preceding such Commencement Date had been continued without change;
(b) $20,000; or
(c) The sum of (i) the contributions (or funds attributable thereto) which
would have been applied to provide benefits for the
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73
Participant if the Pension Plan had been terminated on the day before such
Commencement Date, plus (ii) an amount computed by multiplying the smaller
of $10,000 or twenty percent of the average annual remuneration of such
Participant during the last five years of service by the number of years
since such Commencement Date; or
(d) (i) with respect to a Participant who is one of the 25 highest-paid
employees and who is also a substantial owner (as defined in section
4022(b)(5) of ERISA) the present value of the benefit guaranteed for
such Participant under section 4022 of ERISA, or if the plan has not
terminated, the present value of the benefit that would be guaranteed
if the plan terminated on the date the benefit commences, determined in
accordance with regulations of the PBGC; and (ii) with respect to a
Participant who is one of the 25 highest-paid employees but not a
substantial owner, the present value of the maximum benefit described
in section 4022(b)(3)(B) of ERISA (determined on the earlier of the
date the plan terminates or the date benefits commence, and determined
in accordance with regulations of PBGC) without regard to any other
limitations in section 4022 of ERISA.
10.2 Any funds released by the operation of the provisions of Section 10.1 shall
be allocated in the manner provided for in Section 9.1, but excluding from
such allocation any person whose benefits are reduced by the provisions of
Section 10.1.
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74
10.3 New Pretermination Restrictions
(a) For Plan Years beginning on or after January 1, 1994, benefits
distributed to any of the 25 most highly compensated active and highly
compensated former employees with the greatest compensation in the
current or any prior year are restricted such that the annual payments
are no greater than an amount equal to the payment that would be made
on behalf of the employee under a straight life annuity that is the
actuarial equivalent of the sum of the employee's accrued benefit, the
employee's other benefits under the Plan (other than a social security
supplement, within the meaning of section 1.411(a)-7(c)(4)(ii) of the
Income Tax Regulations), and the amount the employee is entitled to
receive under a social security supplement.
(b) The preceding paragraph shall not apply if:
(i) after payment of the benefit to an employee described in the
preceding paragraph, the value of Plan assets equals or exceeds
110% of the value of current liabilities, as defined in section
412(l)(7) of the Internal Revenue Code,
(ii) the value of the benefits for an employee described above is less
than 1% of the value of current liabilities before distribution, or
(iii) the value of the benefits payable under the Plan to an employee
described above does not exceed $3,500.
(c) An employee's otherwise restricted benefit may be distributed in full
to the affected employee if prior to receipt of the
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75
restricted amount, the employee enters into a written agreement with
the Committee to secure repayment to the Plan of the restricted amount.
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HANDY & HARMAN PENSION PLAN
Article 11
LIMITATIONS ON BENEFITS
11.1 Annual Benefit. For purposes of this Article, "annual benefit" means
the benefit payable annually under the terms of the Plan (exclusive of
any benefit not required to be considered for purposes of applying the
limitations of Code Section 415 to the Plan) payable in the form of a
straight life annuity with no ancillary benefits. If the benefit under
the Plan is payable in any other form, the "annual benefit" shall be
adjusted to the equivalent of a straight life annuity pursuant to
Section 11.3(e).
11.2 Maximum Annual Benefit
(a) Notwithstanding the foregoing and subject to the exceptions
below, the maximum "annual benefit" payable to a participant
under this Plan in any "limitation year" shall equal the
lesser of: (1) $90,000 or (2) one hundred percent (100%) of
the participant's Compensation averaged over the three
consecutive "limitation years" (or actual number of
"limitation years" for participants who have been employed for
less than three consecutive "limitation years") during which
the participant had the greatest aggregate Compensation.
(b) For purposes of applying the limitations of Code Section 415,
the "limitation year" shall be the Plan Year.
(c) Notwithstanding anything in this Article to the contrary, if
the Plan was in existence on May 6, 1986, and had compiled at
all
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77
times with the requirements of Code Section 415, the maximum
"annual benefit" for any individual who is a participant as of
the first day of the "limitation year" beginning after
December 31, 1986, shall not be less than the "current accrued
benefit". "Current accrued benefit" shall mean a participant's
accrued benefit under the Plan, determined as if the
participant had separated from service as of the close of the
last "limitation year" beginning before January 1, 1987, when
expressed as an annual benefit within the meaning of Code
Section 415(b)(2). In determining the amount of a
participant's "current accrued benefit", the following shall
be disregarded: (1) any change in the terms and conditions of
the Plan after May 5, 1986; and (2) any cost of living
adjustment occurring after May 5, 1986.
(d) The dollar limitation under Code Section 415(b)(1)(A) stated
in paragraph (a)(1) above shall be adjusted annually as
provided in Code Section 415(d) pursuant to the applicable
regulations. The adjusted limitation is effective as of
January 1st of each calendar year and is applicable to
"limitation years" ending with or within the calendar year.
(e) The limitation stated in paragraph (a)(2) above for
participants who have separated from service with a
non-forfeitable right to an accrued benefit shall be adjusted
annually as provided in Code Section 415(d) pursuant to the
regulations prescribed by the Secretary of the Treasury.
(f) For the purpose of this Article, all qualified defined benefit
plans (whether terminated or not) ever maintained by the
employer
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78
shall be treated as one defined benefit plan, and all
qualified defined contribution plans (whether terminated or
not) ever maintained by the employer shall be treated as one
defined contribution plan.
(g) For the purpose of this Article, if the employer is a member
of a controlled group of corporations, trades or businesses
under common control (as defined by Code Section 1563(a) or
Code Section 414(b) and (c) as modified by Code Section
415(h)) or is a member of an affiliated service group (as
defined by Code Section 414(m)), all employees of such
employers shall be considered to be employed by a single
employer.
(h) For the purpose of this Article, if this Plan is a Code
Section 413(c) plan, all employers of a participant who
maintain this Plan will be considered to be a single employer.
11.3 Adjustments to Annual Benefit and Limitations
(a) If the "annual benefit" begins before the participant's Social
Security Retirement Age, but on or after age 62, the $90,000
limitation shall be reduced by: (1) in the case of a
participant whose Social Security Retirement Age is 65, 5/9 of
1% for each month by which benefits commence before the month
in which the participant attains age 65, or (2) in the case of
a participant whose Social Security Retirement Age is greater
than 65, 5/9 of 1% for each of the first 36 months and 5/12 of
1% for each of the additional months (up to 24) by which
benefits commence before the month in which the participant
attains his Social Security
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Retirement Age. If the "annual benefit" begins before age 62,
the $90,000 limitation shall be the actuarial equivalent of
the participant's limitation for benefits commencing at age
62, reduced for each month by which benefits commence before
the month in which the participant attains age 62. In order to
determine actuarial equivalence for this purpose, the interest
rate assumption is the greater of five percent (5%) or the
rate specified in Section 1.1.
(b) Notwithstanding Section 11.3 (a) above, for "limitation years"
beginning prior to January 1, 1987, the $90,000 limit shall
not be reduced if the annual benefit begins on or after age
62. If the "annual benefit" begins before age 62, the $90,000
limitation shall be reduced so that it is the actuarial
equivalent of the $90,000 limitation beginning at age 62.
However, the $90,000 limitation shall not be actuarially
reduced to less than: (1) $75,000 if the "annual benefit"
commences on or after age 55, or (2) the amount which is the
actuarial equivalent of the $75,000 limitation at age 55 if
the "annual benefit" commences prior to age 55. For purposes
of adjusting the $90,000 limitation applicable prior to age 62
or the $75,000 limitation applicable prior to age 55, the
adjustment shall be made pursuant to Section 1.01 except that
the interest rate assumption shall be the greater of five
percent (5%) or the rate specified in Section 1.1 and the
mortality decrement shall be ignored to the extent that a
forfeiture does not occur at death.
(c) If the "annual benefit" begins after the participant's Social
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Security Retirement Age (or for Plan Years beginning prior to
January 1, 1987, age 65) the $90,000 limitation shall be
increased so that it is the actuarial equivalent of the
$90,000 limitation at the participant's Social Security
Retirement Age (or for Plan Years beginning prior to January
1, 1987, age 65).
(d) For purposes of adjusting the "annual benefit" to a straight
life annuity, the adjustment shall be made pursuant to Section
1.1 except that the interest rate assumption shall be the
greater of five percent (5%) or the rate specified in Section
1.1.
(e) For purposes of adjusting the $90,000 limitation applicable
after the participant's Social Security Retirement Age (or for
Plan Years beginning prior to January 1, 1987, age 65) the
adjustment shall be made pursuant to Section 1.1 except that
the interest rate assumption shall be the lesser of five
percent (5%) or the rate specified in Section 1.1 and the
mortality decrement shall be ignored to the extent that a
forfeiture does not occur at death.
(f) For purposes of Sections 11.1, 11.3(a) and 11.3(b), no
adjustments under Code Section 415(d) shall be taken into
account before the "limitation year" for which such adjustment
first takes effect.
(g) For purposes of Section 11.1, no adjustment is required for
qualified joint and survivor annuity benefits, pre-retirement
death benefits and post-retirement medical benefits.
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11.4 Annual Benefit Not In Excess of $10,000. This Plan may pay an "annual
benefit" to any participant in excess of his maximum "annual benefit"
if the "annual benefit" derived from employer contributions under this
Plan and all other defined benefit plans maintained by the employer
does not in the aggregate exceed $10,000 for the "limitation year" or
for any prior "limitation year" and the employer has not at any time
maintained a defined contribution plan in which the participant
participated. For purposes of this paragraph, if this Plan provides for
voluntary or mandatory employee contributions, such contributions will
not be considered a separate defined contribution plan maintained by
the employer.
11.5 Participation Or Service Reductions. If a participant has less than ten
(10) years of participation in the Plan at the time he begins to
receive benefits under the Plan, the limitations in Section 11.2(a)(1)
and 11.3 shall be reduced by multiplying such limitations by a fraction
(a) the numerator of which is the number of years of participation (or
part thereof) in the Plan and (b) the denominator of which is ten (10),
provided, however, that said fraction shall in no event be less than
1/10th. The limitations of Section 11.2(a)(2) and 11.4 shall be reduced
in the same manner except the preceding sentence shall be applied with
respect to years of service with the Employer rather than years of
participation in the Plan.
11.6 Multiple Plan Reduction.
(a) If an employee is (or has been) a participant in one or more
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defined benefit plans and one or more defined contribution
plans maintained by the Employer, the sum of the defined
benefit plan fraction and the defined contribution plan
fraction for any "limitation year" may not exceed 1.0.
(b) The defined benefit plan fraction for any "limitation year" is
a fraction, the numerator of which is the sum of the
participant's projected annual benefits under all the defined
benefit plans (whether or not terminated) maintained by the
employer, and the denominator of which is the lesser of 125
percent of the dollar limitation determined for the
"limitation year" under Code Sections 415(b) and (d) or 140
percent of the highest average compensation, including any
adjustments under Code Section 415(b).
Notwithstanding the above, if the participant was a
participant as of the first day of the first "limitation year"
beginning after December 31, 1986, in one or more defined
benefit plans maintained by the Employer which were in
existence on May 6, 1986, the denominator of this fraction
will not be less than 125 percent of the sum of the annual
benefits under such plans which the participant had accrued as
of the close of the last "limitation year" beginning before
January 1, 1987, disregarding any changes in the terms and
conditions of the plan after May 5, 1986. The preceding
sentence applies only if the defined benefit plans
individually and in the aggregate satisfied the
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requirements of Code Section 415 for all "limitation years"
beginning before January 1, 1987.
(c) (1) The defined contribution plan fraction for any
"limitation year" is a fraction, the numerator of
which is the sum of the annual additions to the
participant's account under all the defined
contribution plans (whether or not terminated)
maintained by the employer for the current and all
prior "limitation years" (including the annual
additions attributable to the Participant's
nondeductible employee contributions to all defined
benefit plans, whether or not terminated, maintained
by the employer, and the annual additions
attributable to all welfare benefit funds, as defined
in Code Section 419(e), and individual medical
accounts, as defined in Code Section 415(l)(2),
maintained by the employer), and the denominator of
which is the sum of the maximum aggregate amounts for
the current and all prior "limitation years" of
service with the employer (regardless of whether a
defined contribution plan was maintained by the
employer). The maximum aggregate amount in any
"limitation year" is the lesser of 125 percent of the
dollar limitation determined under Code Section
415(b) and (d) in effect under Code Section
415(c)(1)(A) or 35 percent of the participant's
Compensation for such year.
If the employee was a participant as of the end of
the first day of the first "limitation year"
beginning after December
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31, 1986, in one or more defined contribution plans
maintained by the employer which were in existence on
May 6, 1986, the numerator of this fraction will be
adjusted if the sum of this fraction and the defined
benefit fraction would otherwise exceed 1.0 under the
terms of this Plan. Under the adjustment, an amount
equal to the product of (1) the excess of the sum of
the fractions over 1.0 times (2) the denominator of
this fraction, will be permanently subtracted from
the numerator of this fraction. The adjustment is
calculated using the fractions as they would be
computed as of the end of the last "limitation year"
beginning before January 1, 1987, and disregarding
any changes in the terms and conditions of the Plan
made after May 5, 1986, but using the Code Section
415 limitation applicable to the first "limitation
year" beginning on or after January 1, 1987. The
annual addition for any "limitation year" beginning
before January 1, 1987 shall not be recomputed to
treat all employee contributions as annual additions.
(2) For purposes of this Article, the term "participant's
account" shall mean the account established and
maintained by the administrator for each participant
with respect to his total interest in the defined
contribution plan maintained by the employer
resulting from "annual additions".
(3) For purposes of this Article, the term "annual
additions" shall mean the sum credited to a
"participant's account" for
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any "limitation year" of (A) employer contributions,
(B) employee contributions, (C) forfeitures, (D)
amounts allocated after March 31, 1984, to an
individual medical account, as defined in Code
Section 415(l)(2) which is part of a pension or
annuity plan maintained by the Employer, and (E)
amounts derived from contributions paid or accrued
after December 31, 1985, in taxable years ending
after such date, which are attributable to
post-retirement medical benefits allocated to the
separate account of a key employee (as defined in
Code Section 419A(d)(3)) under a welfare benefit plan
(as defined in Code Section 419(e)) maintained by the
Employer. Except, however, the percentage limitation
referred to in (4)(B) below shall not apply to: (1)
any contribution for medical benefits (within the
meaning of Code Section 419A(f)(2)) after separation
from service which is otherwise treated as an "annual
addition", or (2) any amount otherwise treated as an
"annual addition" under Code Section 415(l)(1).
Notwithstanding the foregoing, for "limitation years"
beginning prior to January 1, 1987, only that portion
of employee contributions equal to the lesser of
employee contributions in excess of six percent (6%)
of Compensation or one-half of employee contributions
shall be considered an "annual addition".
(4) If, as a result of a reasonable error in estimating a
participant's Compensation or other facts and
circumstances to which Regulation 1.415-6(b)(6) shall
be applicable,
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voluntary employee contributions for the "limitation
year" would cause the "annual additions" credited to
a "participant's account" to exceed the lesser of (A)
$30,000 (or, if greater, one-fourth of the dollar
limitation in effect under Code Section 415(b)(1)(A))
or (B) twenty-five percent (25%) of the participant's
Compensation for such limitation year, the
administrator shall, pursuant to Regulation
1.415-6(b)(6)(iv), return such voluntary employee
contributions so the participant to the extent
necessary so that "annual additions" for the
"limitation year" do not exceed the lesser of (A) or
(B).
(d) Notwithstanding the foregoing, for any "limitation year" in
which the Plan is a Top Heavy Plan, 100 percent shall be
substituted for 125 percent in Sections 11.6(b) and 11.6(c)(1)
unless the extra minimum benefit is being provided pursuant to
Section 12.4. However, for any "limitation year" in which the
Plan is a Super Top Heavy Plan, 100 percent shall be
substituted for 125 percent in any event.
(e) If the sum of the defined benefit plan fraction and the
defined contribution plan fraction shall exceed 1.0 in any
"limitation year" for any participant in this Plan, the
Committee shall adjust the numerator of the defined benefit
plan fraction so that the sum of both fractions shall not
exceed 1.0 in any "limitation year" for such participant.
11.7 Incorporation By Reference. Notwithstanding anything contained in
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this Article to the contrary, the limitations, adjustments and other
requirements prescribed in this Article shall at all times comply with
the provisions of Code Section 415 and the Regulations thereunder, the
terms of which are specifically incorporated herein by reference.
11.8 "Compensation" with respect to any participant for purposes of Article
11 and 12 means such participant's wages as defined in Code Section
3401(a) and all other payments of compensation by the Employer (in the
course of the Employer's trade or business) for a Plan Year for which
the Employer is required to furnish the participant a written statement
under Code Sections 6041(d), 6051(a)(3) and 6052. "Compensation" must
be determined without regard to any rules under Code Section 3401(a)
that limit the remuneration included in wages based on the nature or
location of the employment or the services performed (such as the
exception for agricultural labor in Code Section 3401(a)(2)).
11.9 "Social Security Retirement Age" means the age used as the retirement
age under Section 216(l) of the Social Security Act, except that such
section shall be applied without regard to the age increase factor and
as if the early retirement age under Section 216(l)(2) of such Act were
62.
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HANDY & HARMAN PENSION PLAN
Article 12
TOP-HEAVY PROVISIONS
12.1 Top Heavy Plan Requirements. For any Top Heavy Plan Year, the Plan
shall provide the special vesting requirements of Code Section 416(b)
pursuant to Section 12.3 of the Plan and the special minimum benefit
requirements of Code Section 416(c) pursuant to Section 12.4 of the
Plan.
12.2 Determination of Top Heavy Status.
(a) This Plan shall be a Top Heavy Plan for any Plan Year
commencing after December 31, 1983 in which, as of the
Determination Date, (1) the Present Value of Accrued Benefits
of Key Employees and (2) the sum of the Aggregate Accounts of
Key Employees under this Plan and all plans of an Aggregation
Group, exceeds sixty percent (60%) of the Present Value of
Accrued Benefits and the Aggregate Accounts of all Key and
Non-Key Employees under this Plan and all plans of an
Aggregation Group.
If any participant is a Non-Key Employee for any Plan Year,
but such participant was a Key Employee for any prior Plan
Year, such participant's Present Value of Accrued Benefit
and/or Aggregate Account balance shall not be taken into
account for purposes of determining whether this Plan is a Top
Heavy or Super Top Heavy Plan (or whether any Aggregation
Group which includes this Plan is a Top Heavy Group). In
addition, for Plan Years beginning
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after December 31, 1984, if a participant or former
participant has not performed any services for any employer
maintaining the Plan at any time during the five year period
ending on the Determination Date, any accrued benefit for such
participant or former participant shall not be taken into
account for the purposes of determining whether this Plan is a
Top Heavy or Super Top Heavy Plan.
(b) This Plan shall be a Super Top Heavy Plan for any Plan Year
commencing after December 31, 1983 in which, as of the
Determination Date, (1) the Present Value of Accrued Benefits
of Key Employees and (2) the sum of the Aggregate Accounts of
Key Employees Under this Plan and all plans of an Aggregation
Group, exceeds ninety percent (90%) of the Present Value of
Accrued Benefits and the Aggregate Accounts of all Key and
Non-Key Employees under this Plan and all plans of an
Aggregation Group.
(c) Aggregate Account: A Participant's Aggregate Account as of the
Determination Date shall be determined under applicable
provisions of the defined contribution plan used in
determining Top Heavy Plan status.
(d) "Aggregation Group" means either a Required Aggregation Group
or a Permissive Aggregation Group as hereinafter determined.
(1) Required Aggregation Group: In determining a Required
Aggregation Group hereunder, each plan of the
employer in which a Key Employee is a participant in
the Plan Year containing the Determination Date or
any of the four preceding Plan Years, and each other
plan of the employer
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which enables any plan in which a Key Employee
participates to meet the requirements of Code
Sections 401(a)(4) or 410, will be required to be
aggregated. Such group shall be known as a Required
Aggregation Group.
In the case of a Required Aggregation Group, each
plan in the group will be considered a Top Heavy Plan
if the Required Aggregation Group is a Top Heavy
Group. No plan in the Required Aggregation Group will
be considered a Top Heavy Plan if the Required
Aggregation Group is not a Top Heavy Group.
(2) Permissive Aggregation Group: The employer may also
include any other plan not required to be included in
the Required Aggregation Group, provided the
resulting group, taken as a whole, would continue to
satisfy the provisions of Code Sections 401(a)(4) and
410. Such group shall be known as a Permissive
Aggregation Group.
In the case of a Permissive Aggregation Group, only a
plan that is part of the Required Aggregation Group
will be considered a Top Heavy Plan if the Permissive
Aggregation Group is a Top Heavy Group. No plan in
the Permissive Aggregation Group will be considered a
Top Heavy Plan if the Permissive Aggregation Group is
not a Top Heavy Group.
(3) Only those plans of the employer in which the
Determination
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Dates fall within the same calendar year shall be
aggregated in order to determine whether such plans
are Top Heavy Plans.
(4) An Aggregation Group shall include any terminated
plan of the employer if it was maintained within the
last five (5) years ending on the Determination Date.
(e) "Determination Date" means (a) the last day of the preceding
Plan Year, or (b) in the case of the first Plan Year, the last
day of such Plan Year.
(f) "Key Employee" means an employee, a former employee, or the
beneficiary under the Plan of a former employee who, in the
Plan Year containing the Determination Date, or any of the 4
preceding Plan Years, is:
(1) An officer of the employer having an annual
compensation greater than 50% of the amount in effect
under Section 415(b)(1)(A) of the Code, for any such
Plan Year. (Not more than 50 employees or, if lesser,
the greater of 3 employees or 10% of the employees
shall be considered as officers for purposes of this
paragraph);
(2) One of the 10 employees owning (or considered as
owning within the meaning of Section 318 of the
Internal Revenue Code of 1986, as amended) the
largest interest in the employer, who has more than
0.5% ownership interest in value, and whose
Compensation equals or exceeds the maximum dollar
limitation under Section 415(c)(1)(A) of the Code, as
in effect for the calendar year in which the
Determination
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Date falls;
(3) A 5% owner of the employer; or
(4) A 1% owner of the employer having an annual
Compensation from the employer of more than $150,000.
Whether an employee is a 5% owner or a 1% owner shall be
determined in accordance with Section 416(i) of the Code.
(g) Present Value of Accrued Benefit: In the case of a defined
benefit plan, a participant's Present Value of Accrued Benefit
shall be determined:
(1) in the case of a participant other than a Key
Employee, using the single accrual method used for
all plans of the employer and affiliated employers,
or if no such single method exists, using a method
which results in benefits accruing not more rapidly
than the slowest accrual rate permitted under Code
Section 411(b)(1)(C).
(2) as of the most recent "actuarial valuation date",
which is the most recent valuation date within a
twelve (12) month period ending on the Determination
Date.
(3) for the first Plan Year, as if (a) the participant
terminated service as of the Determination Date; or
(b) the participant terminated service as of the
actuarial valuation date, but taking into account the
estimated accrued benefits as of the Determination
Date.
(4) for the second Plan Year, the accrued benefit taken
into account for a current participant must not be
less than the
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93
accrued benefit taken into account for the first Plan
Year unless the difference is attributable to using
an estimate of the accrued benefit as of the
Determination Date for the first Plan Year and using
the actual accrued benefit for the second Plan Year.
(5) for any other Plan Year, as if the participant
terminated service as of the actuarial valuation
date.
(6) the actuarial valuation date must be the same date
used for computing the defined benefit plan minimum
funding costs, regardless of whether a valuation is
performed that Plan Year.
(7) by not taking into account proportional subsidies.
(8) by taking into account nonproportional subsidies.
(h) The calculation of a participant's Present Value of Accrued
Benefit as of a Determination Date shall be the sum of:
(1) the Present Value of Accrued Benefit using the
actuarial assumptions of Section 1.1, which
assumptions shall be identical for all defined
benefit plans being tested for Top Heavy Plan status.
(2) any Plan distributions made within the Plan Year that
includes the Determination Date or within the four
(4) preceding Plan Years. However, in the case of
distributions made after the valuation date and prior
to the Determination Date, such distributions are not
included as distributions for top heavy purposes to
the extent that such distributions are already
included in the participant's Present Value of
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Accrued Benefit as of the valuation date.
Notwithstanding anything herein to the contrary, all
distributions, including distributions made prior to
January 1, 1984, and distributions under a terminated
plan which if it had not been terminated would have
been required to be included in an Aggregation Group,
will be counted. Further, benefits paid on account of
death, to the extent such benefits do not exceed the
Present Value of Accrued Benefits existing
immediately prior to death, shall be treated as
distributions for the purposes of this paragraph.
(3) any employee contributions, whether voluntary or
mandatory. However, amounts attributable to tax
deductible Qualified Voluntary Employee Contributions
shall not be considered to be a part of the
participant's Present Value of Accrued Benefit.
(4) with respect to unrelated rollovers and plan-to-plan
transfers (ones which are both initiated by the
employee and made from a plan maintained by one
employer to a plan maintained by another employer),
if this Plan provides the rollovers or plan-to-plan
transfers, it shall always consider such rollovers or
plan-to-plan transfers as a distribution for the
purposes of this Section. If this Plan is the plan
accepting such rollovers or plan-to-plan transfers,
it shall not consider such rollovers or plan-to- plan
transfers accepted after December 31,1983, as part of
the participant's Present Value of Accrued Benefit.
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95
However, rollovers or plan-to-plan transfers accepted
prior to January 1, 1984, shall be considered as part
of the participant's Present Value of Accrued
Benefit.
(5) with respect to related rollovers and plan-to-plan
transfers (ones either not initiated by the employee
or made to a plan maintained by the same employer),
if this Plan provides the rollovers or plan-to-plan
transfers, it shall not be counted as a distribution
for purposes of this Section. If this Plan is the
plan accepting such rollovers or plan-to-plan
transfers, it shall consider such rollovers or
plan-to-plan transfers as part of the participant's
Present Value of Accrued Benefit, irrespective of the
date on which such rollovers or plan-to-plan
transfers are accepted.
(6) for the purposes of determining whether two employers
are to be treated as the same employer in (4) and (5)
above, all employers aggregated under Code Section
414(b), (c), (m) or (o) are treated as the same
employer.
(i) "Top Heavy Group" means an Aggregation Group in which, as of
the Determination Date, the sum of:
(1) the Present Value of Accrued Benefits of Key
Employees under all defined benefit plans included in
the group, and
(2) the Aggregate Accounts of Key Employees under all
defined contribution plans included in the group,
exceeds sixty percent (60%) of a similar sum
determined for all participants.
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96
12.3 Vesting For Top Heavy Plan. Notwithstanding the vesting provided for in
Section 2.5, for any Top Heavy Plan Year, the vested portion of the
accrued benefit of any participant who has an Hour of Service after the
Plan becomes top heavy shall be a percentage of the participant's
accrued benefit determined on the basis of the participant's number of
years of service according to the following schedule:
Vesting Schedule
Continuous Service Percentage
------------------ ----------
Less than 3 0%
3 100%
If in any subsequent Plan Year, the Plan ceases to be a Top Heavy Plan,
the Committee shall revert to the vesting schedule in effect before
this Plan became a Top Heavy Plan. Any such reversion shall be treated
as a Plan amendment pursuant to the terms of the Plan.
12.4 Minimum Benefit Requirement For Top Heavy Plan
(a) The minimum accrued benefit derived from employer
contributions to be provided under this Section for each
employee who is a participant during a Top Heavy Plan Year
shall equal the product of (1) one-twelfth (1/12th) of
Compensation averaged over the five (5) consecutive
"limitation years" (or actual number of "limitation years," if
less) which produce the highest average, and (2) the lesser of
(i) two percent (2%) multiplied by Credited Service, or (ii)
twenty percent (20%), expressed as a single life annuity.
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97
However, for any Plan Year when (1) the Plan is a Top Heavy
Plan but not a Super Top Heavy Plan and (2) a Key Employee is
a participant in both this Plan and a defined contribution
plan included in a Required Aggregation Group which is top
heavy, the extra minimum accrued benefit (required by Section
11.6(d) to provide the higher limitations) shall be provided
for each employee who is a participant by substituting three
percent (3%) for two percent (2%) and thirty percent (30%) for
twenty percent (20%) above.
(b) For purposes of providing the minimum benefit under Code
Section 416, an employee who is not a participant solely
because (1) his Compensation is below a stated amount or (2)
he declined to make mandatory contributions (if required) to
the plan will be considered to be a participant. Furthermore,
such minimum benefit shall be provided regardless of whether
such employee is employed on a specified date.
(c) For purposes of this Section, Benefit Service for any Plan
Year beginning before January 1, 1984, or for any Plan Year
during which the Plan was not a Top Heavy Plan shall be
disregarded.
(d) For purposes of this Section Compensation, for any "limitation
year" ending in a Plan Year which began prior to January 1,
1984, subsequent to the last "limitation year" during which
the Plan is a Top Heavy Plan, or in which the participant
failed to complete a year of service, shall be disregarded.
(e) If Article 4 provides for the Normal Retirement Benefit to be
paid in a form other than a single life annuity, the accrued
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98
benefit under this Section shall be the Actuarial Equivalent
of the minimum Accrued benefit under (a) above pursuant to
Section 1.1.
(f) If payment of the minimum accrued benefit commences at a date
other than Normal Retirement Date, the minimum accrued benefit
shall be the Actuarial Equivalent of the minimum accrued
benefit commencing at Normal Retirement Date pursuant to
Section 1.1.
(g) If a Non-Key Employee participates in this Plan and a defined
contribution plan included in a Required Aggregation Group
which is top heavy, the minimum benefits shall be provided
under this Plan for any Plan Year beginning prior to January
1, 1993.
(h) Notwithstanding the foregoing, for Plan Years beginning after
December 31, 1992, the minimum benefit requirement for a Top
Heavy Plan shall be determined in the following manner:
(1) Each employee who is a participant during a Top Heavy
Plan Year shall be provided the minimum accrued
benefit pursuant to (a) above.
(2) For any Plan Year when (i) the Plan is a Top Heavy
Plan but not a Super Top Heavy Plan and (ii) a Key
Employee is a participant in both this Plan and a
defined contribution plan included in a required
Aggregation Group which is top heavy, the extra
minimum accrued benefit (required by Section 11.6(d)
to provide the higher limitations) shall be provided
for each employee who is a participant by
substituting three percent (3%) for two percent (2%)
and thirty percent (30%) for twenty percent (20%) in
(a) above.
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(3) the extra minimum accrued benefit (required by
Section 11.6(d) to provide the higher limitations)
will not be provided.
(i) To the extent required to be nonforfeitable under Section
12.3, the minimum accrued benefit under this Section may not
be forfeited under Code Section 411(a)(3)(B) or Code Section
411(a)(3)(D).
12.5 Cancellation of Section. In the event that it should subsequently be
determined by statute, Supreme Court decision, ruling by the
Commissioner of Internal Revenue, or otherwise that the provisions of
this Article 12 are no longer necessary to qualify the Plan under the
Internal Revenue Code, this Article 12 shall become ineffective without
amendment to the Plan.
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HANDY & HARMAN PENSION PLAN
Article 13
MERGER, CONSOLIDATION, OR ASSET OR LIABILITY TRANSFER
13.1 In the event that this Pension Plan and the Pension Trust merges or
consolidates with, or transfers its assets or liabilities to, any other
plan of deferred compensation qualified under Code Section 401(a), no
Participant herein shall, solely on account of such merger,
consolidation or transfer, be entitled to a benefit immediately
following such event which is less than the benefit to which he was
entitled immediately preceding such event. For the purpose of this
Section, the benefit to which a Participant is entitled shall be
calculated based upon the assumption that the Pension Plan terminated
and distribution of assets occurred on the day as of which the amount
of the Participant's entitlement is being determined.
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HANDY & HARMAN PENSION PLAN
Article 14
MISCELLANEOUS PROVISIONS
14.1 The text of any Section shall always govern and control in the event of
any conflict with the heading of such Section.
14.2 The terms of the Pension Plan shall always govern and control in the
event of any conflict with the terms of any booklet or other document
relating to the Pension Plan distributed to any Participant,
beneficiary or spouse.
14.3 The amount of any benefit to which any person is entitled under the
Pension Plan shall always be governed and controlled by the Pension
Plan in the event of any conflict with the amount of such benefit set
forth in any booklet or other document relating to the Pension Plan
distributed to any Participant, beneficiary or spouse.
14.4 Wherever applicable, any word used in the masculine shall include the
feminine, and any word used in the singular shall include the plural.
14.5 Each Participating Company and each Participant, beneficiary and
surviving spouse shall be bound by all of the terms and provisions of
the Pension Plan and the Pension Trust.
14.6 Except to comply with the applicable requirements of a Qualified
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102
Domestic Relations Order or to the extent otherwise expressly required
by law, no benefit payable under or purchased by the Pension Plan or
Pension Trust shall be subject to the claims of any creditor of any
Participant or his spouse or beneficiary, nor shall the same be subject
to attachment, garnishment or other legal or equitable process by any
creditor of the Participant or his spouse or beneficiary, nor shall any
Participant or his spouse or beneficiary have any right to alienate,
anticipate, commute, pledge, encumber or assign any such benefits.
14.7 Any discretionary act taken or any discretionary decision made by the
Committee at any time shall not constitute or result in discrimination
in favor of employees who are officers, shareholders, or
highly-compensated employees.
14.8 Any act or procedure specified or permitted by the Pension Plan shall
be subject to such change as the Committee may deem necessary in order
to conform to the requirements of any applicable law.
14.9 If an individual enters the military service of the United States after
he has become a Participant, his rights under the Pension Plan during
the period of such military service shall be determined by the Company.
Such determination
14-2
103
shall be binding and conclusive on such individual and on all other
persons and parties concerned. However, such decision shall not
constitute or result in discrimination in favor of individuals who are
officers, shareholders, or highly-compensated employees.
14.10 The adoption and maintenance of the Pension Plan shall not be construed
or interpreted in any way as constituting a contract of employment
between any Participating Company and any of its Employees or
Participants, or as constituting an inducement to or consideration for
the employment by the Participating Company of any of its Employees or
Participants. Any Participating Company shall have the right at any
time to terminate the employment of any of its Employees or
Participants with the same force and effect as if the Pension Plan had
never been adopted.
14.11 Nothing herein shall be deemed to prohibit a member of the Committee,
the Pension Trustee or Trustees, or any other Pension Plan fiduciary or
official from serving in more than one fiduciary capacity with respect
to the Pension Plan.
14-3
104
FIRST AMENDMENT TO THE
HANDY & HARMAN PENSION PLAN
(AS AMENDED AND RESTATED EFFECTIVE DECEMBER 1, 1989)
(THE "PLAN")
The Handy & Harman Pension Plan is amended in the following respects:
1) Section 1.1 of the Plan defining "Actuarial Equivalent" as in effect for
all participating companies is hereby amended effective June 1, 1995, to
apply to all Participants who have an Hour of Service on or after June 1,
1995, to read as follows:
"1.1 'Actuarial Equivalent' shall mean when applicable to a benefit
payable as a monthly pension hereunder that the benefit has, at the
date of determination, the same value as the applicable other
benefit payable as a monthly pension hereunder when computed with
interest at 8% per year, compounded annually, and with mortality in
accordance with the Unisex Pension 1984 Mortality Table without age
adjustment in the case of the Participant and set back three years
in the case of a spouse.
In any case where the Actuarial Equivalent of the benefit payable
to any Participant who has an Hour of Service on or after June 1,
1995, or the surviving spouse of such a Participant, is determined
as a single sum amount, such Actuarial Equivalent shall be based on
the applicable calculation period, the applicable interest rate and
the applicable mortality table. The applicable calculation period
is the calendar quarter in which the individual's Annuity Starting
Date occurs. The applicable interest rate is the interest rate on
30-year Treasury securities for the second month prior to the
beginning of the applicable calculation period, as specified by the
Internal Revenue Service, and as adjusted for the required one year
transition period. The applicable mortality table is the 1983 Group
Annuity Mortality Table with a 50% male and 50% female composite as
published in Revenue Ruling 95-6. However, the single sum amount
will not be less than the amount based on the Participant's Accrued
Monthly Pension as of June 1, 1995 under the Plan as in effect on
June 1, 1995 computed with interest at 8% per
105
year, compounded annually, and with mortality in accordance with
the Unisex Pension 1984 Mortality Table without age adjustment in
the case of the Participant and set back three years in the case
of the spouse, and reflecting the age of the individual at the
Annuity Starting Date. In determining any single sum amount the
determination shall be made assuming the Participant is not
married and elects no optional form of pension. In the case of
determining the single sum amount for a Participant who is not
entitled to an immediate pension, such single sum amount shall be
determined reflecting the amount of pension commencing at the
Participant's Normal Retirement Date."
2) Section 2.4 of the Plan regarding "Active Participant" as in effect for
all participating companies is hereby amended effective June 1, 1995 to
read as follows:
"2.4 Active Participant. Each Member Of The Eligible Class shall become
an Active Participant on the earliest January 1st or July 1st
coincident with (next following, if none coincides with) the date
as of which he has both completed one year of Continuous Service
and attained his 21st Birthday. An Active Participant shall cease
to be an Active Participant on the date as of which he ceases to
be a Member Of The Eligible Class."
106
SECOND AMENDMENT TO THE
HANDY & HARMAN PENSION PLAN
(AS AMENDED AND RESTATED EFFECTIVE DECEMBER 1, 1989)
(THE "PLAN")
The Handy & Harman Pension Plan is amended effective January 1, 1997 in the
following respects:
(1) Section 3.3 of the Plan defining "Accrued Monthly Pension" as in effect
for all Participating Companies is hereby amended by adding the following
wording at the end of the present section 3.3:
", provided that the Accrued Monthly Pension of any Participant who had
any period of coverage under the Optional Preretirement Spouse Pension
described in Section 4.25 shall have his Accrued Monthly Pension reduced
for the cost of that coverage as determined under Section 4.25."
(2) A new Section 4.25 regarding Optional Preretirement Spouse Pension is
hereby added to the Plan to read as follows:
"4.25 Optional Preretirement Spouse Pension. An Active Participant may
elect to increase the Preretirement Spouse Pension described in Section
4.5 to the amount that would be provided by substituting a 100% Joint And
Survivor Pension election for the deemed 50% Joint And Survivor Pension
election provided under Section 4.5.
107
An Active Participant may elect to have this coverage become effective on
either Option Effective Date 1 or Option Effective Date 2 determined as
follows:
Option Effective Date 1 shall be the latest of (a), (b) and (c):
(a) the date five years prior to the Active Participant's Earliest Benefit
Commencement Date,
(b) the first day of the month coincident with or next following the Active
Participant's first anniversary of his marriage to his spouse,
(c) January 1, 1997.
Option Effective Date 2 shall be the latest of (d), (e) and (f):
(d) the Active Participant's Earliest Benefit Commencement Date,
(e) the first day of the month coincident with or next following the Active
Participant's first anniversary of his marriage to his spouse,
(f) January 1, 1997.
An Active Participant may elect the coverage in the 90 day period ending on
Option Effective Date 1 or Option Effective Date 2. If the Active Participant
elects the coverage to become effective on Option Effective Date 1, it will be
presumed that the coverage will continue during the period beginning on Option
Effective Date 2 unless the Participant makes a timely written election to
cancel the coverage effective on Option Effective Date 2.
The election for this coverage is irrevocable and with one exception it may not
be revoked during the remainder of the period up to the Participant's benefit
commencement date, whether or not the pension commences at the Participant's
termination of employment. The one exception is when the Participant elects
coverage at Option Effective Date 1 in which case the Participant may elect to
discontinue the coverage at Option Effective Date 2 provided written notice is
provided to the Administrative Committee on a form authorized by the
Administrative Committee during the 90 day period ending on Option Effective
Date 2.
108
An election made under this Section 4.25 will result in the Preretirement
Spouse Pension described under Section 4.5 being determined by substituting a
100% Joint And Survivor Pension for the 50% Joint And Spouse Pension otherwise
provided thereunder.
A charge of 4/100% (i.e. .0004) of the Participant's Accrued Monthly Pension
shall be made for each month the coverage is in effect (i.e. .48% per year).
This charge will be made whether the pension is payable as a retirement benefit
to the Participant or as a survivor pension to the spouse. A month of
coverage will be each calendar month beginning with the Option Effective Date 1
or Option Effective Date 2 as applicable, and ending with the date of benefit
commencement (Participant's date of death if earlier) during which the
Participant has a spouse (or ex-spouse for whom a qualified domestic relation
order applies). A Participant's coverage will cease upon divorce provided a
qualified domestic relations order does not require continued coverage, or upon
the death of the spouse. If a Participant whose elected coverage ceases because
of divorce or death of the spouse subsequently remarries, months of coverage
under this Section 4.25 and the charge applicable thereto will recommence
twelve months after the Participant's remarriage."
109
FOURTH AMENDMENT TO THE
HANDY & HARMAN PENSION PLAN
(AS AMENDED AND RESTATED EFFECTIVE DECEMBER 1, 1989)
(THE "PLAN")
The Handy & Harman Pension Plan is amended effective January 1, 1997 in the
following respects:
1) The first sentence of the second paragraph of Section 1.1 of the Plan
defining "Actuarial Equivalent" as in effect for all participating
companies is hereby amended to read as follows:
"In any case where the Actuarial Equivalent of the benefit payable to any
Participant who has an Hour of Service on or after June 1, 1995 or whose
monthly pension would otherwise commence on or after July 1, 1997, or the
surviving spouse of such a Participant, is determined as a single sum
amount, such Actuarial Equivalent shall be based on the applicable
calculation period, the applicable interest rate and the applicable
mortality rate."
2) Section 1.1 of the Plan defining "Actuarial Equivalent" as in effect for
former hourly employees of Conn-Form Corporation and former salaried
employees of Platina Laboratories, Inc. is hereby amended to add an
additional paragraph to the end of the present Section 1.1 to read as
follows:
"Notwithstanding the above, in the case of a former hourly employee of
Conn-Form Corporation whose pension was determined during or prior to
1987 to be payable as a lump sum amount, and in the case of a former
salaried employee of Platina Laboratories, Inc. whose pension was
determined during or prior to 1991 to be payable as a lump sum but whose
amount of lump sum was inadvertently not paid, then a revised amount of
lump sum shall be calculated and paid to the Participant even if such
revised amount of lump sum exceeds $3,500. The recalculated amount will be
equal to the amount of lump sum previously determined and increased with
interest to reflect the period from the prior calculation date to the
expected payment date at an annual rate of interest equal to the PBGC
immediate interest rate reflected in the original calculation of the lump
sum amount."
3) Section 1.10 of the Plan defining "Employee" as in effect for all
participating companies, is hereby amended to read as follows:
"1.10 'Employee' shall mean each individual who is in the employment of
an Affiliated Corporation on or after December 1, 1989 or such
later date that the employment unit which employs him became a
Participating Company. An individual shall be considered an
Employee for the purpose of the Plan only if the individual is a
common law employee of the employer who is also initially treated
as a common law employee on the payroll records of the employer."
110
4) Section 4.22 of the Plan regarding "Commencement Date of Pensions" as in
effect for all participating companies is hereby amended to add the
following paragraph at the end of the present Section 4.22:
"If a Participant applies for a benefit after the date on which the
Participant's benefit would otherwise have commenced in an unreduced
amount (but not earlier than the first day of the month following the
Participant's termination of employment), payments will be made to the
Participant in an actuarially increased amount reflecting the date of the
Participant's application for the benefit (but not later than the April
1st following the calendar year in which the Participant attains age
70 1/2). The Participant may elect before the first such actuarially
increased payment is made to him, to instead receive payments retroactive
to the date that monthly payments otherwise would have been paid in an
unreduced amount. If the Participant elects retroactive payments and the
period of retroactive payments is 12 months or more, the sum of the back
payments will be increased with interest at the annual rate of 8%
reflecting the date that each such retroactive payment would have been
paid."
5) Paragraph (e) of Section 11.2 of the Plan regarding "Maximum Annual
Benefit" is hereby amended to read as follows:
"(e) The limitations stated in Paragraph (a) regarding the dollar
limitation and regarding the 100% of compensation limitation shall
be adjusted annually as provided in Code Section 415(b) pursuant
to the regulations prescribed by the Secretary of the Treasury for
participants who have separated from service with a nonforfeitable
right to an accrued benefit."
111
FIFTH AMENDMENT TO THE
HANDY & HARMAN PENSION PLAN
(AS AMENDED AND RESTATED EFFECTIVE DECEMBER 1, 1989)
(THE "PLAN")
The Handy & Harman Pension Plan as in effect at all Participating Companies is
hereby amended effective January 1, 1998 in the following respects:
(1) Amend the first sentence of Section 3.13B of the Plan to read as follows:
"3.13B The definition of Average Monthly Basic Pay in this Section 3.13B
is effective for the period starting December 1, 1992 and ending
December 31, 1997."
(2) Add a new section 3.13C to the Plan to read as follows:
"3.13C The definition of Average Monthly Basic Pay in this Section 3.13C
is effective for the period starting January 1, 1998. "Average
Monthly Basic Pay" for the period starting January 1, 1998 shall
mean for an Active Participant in and for any Plan Year
one-twelfth of the average of his Basic Pay during all his Plan
Years beginning with the Plan Year commencing on January 1, 1998
provided that at least five Plan Years will be included in such
average except that if there are not at least five Plan Years as to
which Basic Pay is defined for the Active Participant, Average
Monthly Basic Pay for such Active Participant shall be equal to
the average of his Basic Pay for all those Plan Years for which
Basic Pay is defined for him, and further provided that if such
Active Participant has any period of consecutive Plan Years
beginning on or after December 1, 1988 that includes the same
number of Plan Years that is included in his Average Monthly Basic
Pay which results in a larger amount of Average Monthly Basic Pay
such larger Average Monthly Basic Pay will be reflected in his
calculation."