EXHIBIT 4.6
UNITED DEFENSE LIMITED PARTNERSHIP
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SALARIED EMPLOYEES' PLAN
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Page i
UDLP SALARIED
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EMPLOYEES'
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PLAN
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TABLE OF CONTENTS
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Page
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SECTION 1 ESTABLISHMENT OF THE PLAN............................ 1
SECTION 2 ELIGIBILITY AND PARTICIPATION........................ 2
(a) Participants................................... 2
(b) Suspension of Active Participation............. 2
(c) Termination of Participation................... 3
SECTION 3 EMPLOYEE-ELECTED COMPANY CONTRIBUTIONS............... 4
(a) Employee-Elected Company Contributions......... 4
(b) Changing the Rate of Employee-Elected Company
Contributions.................................. 5
(c) Payroll Deductions............................. 5
(d) Investment of Employee-Elected Company
Contributions.................................. 5
(e) Transfer of Funds.............................. 5
(f) Rollover Amount From Other Plans............... 6
(g) Special Employee Contributions................. 7
SECTION 4 COMPANY CONTRIBUTIONS................................ 10
(a) Company Contributions.......................... 10
(b) Allocation of Company Contributions and
Forfeitures.................................... 11
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UDLP SALARIED
EMPLOYEES' PLAN
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TABLE OF CONTENTS
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(Continued)
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SECTION 5 WITHDRAWALS......................................... 12
(a) Withdrawals from Special Employee
Contributions................................. 12
(b) Withdrawals from Employee Contributions....... 12
(c) Withdrawals from Employer Contributions....... 13
(d) Hardship Withdrawals.......................... 13
(e) Age 59-1/2 Withdrawals........................ 15
(f) Election and Payment of Withdrawals........... 15
(g) Source of Payment............................. 15
(h) Form of Payment and Valuation Date............ 16
(i) Limitation on Withdrawals..................... 16
(j) Suspension for Withdrawals.................... 16
SECTION 6 LOANS............................................... 18
(a) Terms of Loans................................ 18
(a) Limitations on Loans.......................... 19
(c) Loan Procedures............................... 19
(d) Repayment of Loans............................ 19
SECTION 7 VESTING............................................. 20
(a) Five-Year Vesting............................. 20
(b) Graded Vesting................................ 20
(c) Full Vesting.................................. 20
SECTION 8 DISTRIBUTABLE INTERESTS AND FORFEITURES............. 21
(a) Plan Benefits................................. 21
(b) Forfeitures................................... 21
Page iii
UDLP SALARIED
EMPLOYEES' PLAN
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TABLE OF CONTENTS
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(Continued)
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SECTION 9 FORM OF PLAN BENEFIT................................. 23
(a) Normal Forms of Distribution................... 23
(b) Optional Form of Distribution.................. 24
(c) Participant's Election to Receive Cash......... 25
(d) Missing Persons................................ 25
(e) Payments to Beneficiary........................ 26
(f) Change of Election............................. 27
(g) Foreign Transfers.............................. 27
SECTION 10 CLAIM PROCEDURE...................................... 29
(a) Application for Benefits....................... 29
(b) Denial of Applications......................... 29
SECTION 11 APPEAL PROCEDURE..................................... 30
(a) The Review Panel............................... 30
(b) Requests for a Review.......................... 30
(c) Decision on Review............................. 30
(d) Rules and Procedures........................... 31
(e) Exhaustion of Remedies......................... 31
SECTION 12 ADMINISTRATION AND OPERATION OF THE PLAN............. 32
(a) Administrative Responsibilities................ 32
(b) Appointment of Trustees........................ 32
(c) Delegation of Fiduciary Responsibilities....... 32
SECTION 13 FUNDING OF THE PLAN.................................. 34
(a) Funding Policy and Method...................... 34
(b) Public Accountant.............................. 34
(c) Basis of Payments to the Plan.................. 34
(d) Basis of Payments from the Plan................ 35
(e) Investment of Trust Assets..................... 35
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UDLP SALARIED
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EMPLOYEES' PLAN
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TABLE OF CONTENTS
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(Continued)
SECTION 14 PARTICIPANTS' ACCOUNTS................................ 37
(a) Participants' Accounts.......................... 37
(b) Rules Relating to Plan Investments and
Earnings Adjustments............................ 37
(c) Stock Fund...................................... 38
SECTION 15 AMENDMENT AND TERMINATION OF THE PLAN................. 40
(a) Future of the Plan.............................. 40
(b) Amendments...................................... 40
(c) Termination of the Plan......................... 40
(d) Allocation of Trust Fund Upon Termination....... 41
SECTION 16 CONTRIBUTION LIMITATIONS.............................. 42
(a) Limitation of Allocations....................... 42
(b) Maximum Annual Additions........................ 43
(c) Adjustment for Excessive Annual Additions....... 49
SECTION 17 TOP HEAVY PROVISIONS.................................. 51
(a) Top Heavy Plan Requirements..................... 51
(b) Determination of Top Heavy Status............... 51
(c) Minimum Benefit Requirement for Top Heavy Plan.. 56
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UDLP SALARIED
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EMPLOYEES' PLAN
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TABLE OF CONTENTS
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(Continued)
SECTION 18 GENERAL PROVISIONS................................... 58
(a) Plan Mergers................................... 58
(b) No Assignment of Property Rights............... 58
(c) Beneficiary.................................... 59
(d) Incapacity..................................... 59
(e) Employment Rights.............................. 59
(f) Voting Rights.................................. 60
(g) Rights on Tender or Exchange Offer............. 60
(h) Account Statements............................. 61
(i) Choice of Law.................................. 61
SECTION 19 DEFINITIONS.......................................... 62
SECTION 20 EXECUTION............................................ 71
Page vi
SECTION 1
UNITED DEFENSE LIMITED PARTNERSHIP
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SALARIED EMPLOYEES' PLAN
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SECTION 1. ESTABLISHMENT OF THE PLAN.
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United Defense Limited Partnership Salaried Employees' Plan is established
by UDLP effective January 1, 1995. The Plan is intended to provide employees of
the Company an opportunity for systematic investment, to strengthen the interest
of employees in the Company and thereby promote the mutual interests of the
Company, its eligible employees and its shareholders, and to provide a measure
of financial security for employees and their beneficiaries. The Plan is
subject to change to meet applicable rules and regulations of the Internal
Revenue Service and the United States Department of Labor and for such other
reasons as UDLP may determine. The Plan is intended to qualify as a profit-
sharing plan for purposes of sections 401(a), 402, 412, and 417 of the Code.
Certain capitalized terms in the Plan text are defined in alphabetical order in
Section 19.
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SECTION 2
SECTION 2. ELIGIBILITY AND PARTICIPATION.
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(a) Participants. Participation in the Plan is voluntary. An Eligible
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Employee may elect at any time to participate in the Plan by filing the
prescribed application form with the local personnel office. The Regular
Compensation of an Eligible Employee who so elects to participate shall be
reduced by an amount equal to the Dollar Limit, but not more than 15% of his
Earnings, which reduced amount shall be his "Adjusted Regular Compensation."
Such Eligible Employee shall become a Participant on the first day of the first
payroll period occurring on or after the first of the calendar month next
following the date his application form is received by UDLP in the local human
resources office. If a Participant terminates employment with the Affiliated
Group, he shall resume participation on the first day of the payroll period
following the 30th day after his election to resume participation, on the
prescribed application form, is received by UDLP in the local human resources
office.
(b) Suspension of Active Participation. A Participant's Active
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Participation in the Plan shall be suspended during the following periods of
time:
(i) Any period during which he continues to be an employee of the
Affiliated Group but does not qualify as an Eligible Employee.
(ii) Any period for which he does not receive Earnings, including
(without limitation) any leave of absence without pay.
(iii) A period described in Subsection 3(a)(ii) and the last sentence
of Subsection 5(j) (voluntary discontinuance of Employee-Elected Company
Contributions).
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SECTION 2(b)(iv)
(iv) A period described in Subsections 5(a) and (b) relating to
periods of suspension following various forms of withdrawal.
(v) The period falling between the date when her employment with
the Company terminates and the date when her participation terminates under
Subsection 2(c).
While a Participant's Active Participation is suspended, she
shall neither elect any Employee-Elected Company Contributions nor receive any
allocation of Company Contributions or Forfeitures made with respect to the
period of suspended Active Participation. Vesting will continue during
suspension and termination periods under (i), (iii), and (iv) above but not
under (v) above. Vesting will continue only during the first 12 months of a
period under (ii) above, but not thereafter. The accounts of a Participant whose
Active Participation is suspended shall, subject to Subsection 3(e), remain
invested in the FMC Stock Fund, Harsco Stock Fund, Equity Fund, or Fixed Income
Fund, as the case may be, and shall continue to be credited with any earnings,
appreciation or losses arising with respect thereto.
(c) Termination of Participation. Any Participant shall cease to
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participate in the Plan as of the date when her entire Plan Benefit has been
distributed or on the date of her death.
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SECTION 3
SECTION 3. EMPLOYEE-ELECTED COMPANY CONTRIBUTIONS.
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(a) Employee-Elected Company Contributions.
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(i) Election. While a Participant's Active Participation is not
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suspended he may elect to have contributed to the Trust out of the amount of his
compensation reduction provided in Subsection 2(a), an "Employee-Elected Company
Contribution." A Participant may elect an annual rate of Employee-Elected
Company Contributions of at least 2% and up to 15% (in whole percentages) of his
Earnings, but not more than the Dollar Limit per Year by filing the prescribed
application form with the local personnel office. No Participant shall be
permitted to have Employee-Elected Company Contributions made under this Plan
during any Year that, when aggregated with elective deferrals (within the
meaning of Code section 402(g)(3)) made under all other plans of the Company
during such Year, such contributions exceed the Dollar Limit. Such election
shall be effective beginning with the first payroll period occurring on or after
the first of the calendar month next following the date his application form is
received by UDLP in the local human resources office.
(ii) Discontinuance. A Participant may elect at any time the
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discontinuance of future Employee-Elected Company Contributions, effective
beginning with the first payroll period occurring on or after the first of the
calendar month next following the date her election, on the prescribed form, is
filed with the local human resources office. The Active Participation of any
Participant who makes such an election shall be suspended under Subsection 2(b)
for a minimum period of six (6) months, and thereafter Active Participation
shall be resumed the first day of the first payroll period following the 30th
day after her election to resume Employee-Elected Company Contributions is
received by UDLP in the local human resources office, on the prescribed
application form.
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SECTION 3(b)
(b) Changing the Rate of Employee-Elected Company Contributions. A
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Participant may elect to change her rate of Employee-Elected Company
Contributions to any other rate available to her under Subsection 3(a) above.
Any election under this Subsection 3(b) shall be made by filing the prescribed
form with the local human resources office and shall be effective beginning with
the first payroll period occurring on or after the first of the calendar month
next following the date her form is filed. No Participant shall make more than
two elections under this Subsection 3(b) during any Plan Year, unless UDLP
consents to any additional election or elections.
(c) Payroll Deductions. During each payroll period, the portion of a
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Participant's share of her compensation reduction that the Participant does not
elect to have contributed to the Trust as an Employee-Elected Company
Contribution (or the entire amount of such compensation reduction during any
period of suspension) shall be paid to the Participant in cash as compensation
in addition to the Participant's Adjusted Regular Compensation.
(d) Investment of Employee-Elected Company Contributions. A Participant's
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Employee-Elected Company Contributions shall be invested (i) entirely in the FMC
Harsco Stock Fund, the Fixed Income Fund, or the Equity Fund, or (ii) in two or
more of those Funds in multiples of 25%, as he shall elect by filing the
prescribed application form except that a Participant whose investment in the
Harsco Stock Fund (excluding Harsco Stock transferred into this Plan from an
"Other Plan" as defined in Subsection 3(f)) exceeds 10% of her Plan Benefit may
not elect any further investment in the Harsco Stock Fund. A Participant may
change such election prospectively for an entire Plan Year by filing the
prescribed form with the local personnel office not less than 30 days prior to
such Plan Year.
(e) Transfer of Funds. A Participant who has attained age 55 may elect to
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transfer among the Fixed Income Fund, the FMC Stock Fund, the Harsco Stock Fund,
and the Equity Fund the entire balance (if any) of his Employee Contributions
Account, Special Employee Contributions Account, and Employee-Elected Company
Contributions Account
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SECTION 3(e)
then invested in any of such Funds, or any portion of the aggregate balance of
those accounts, in multiples of 20%. Any election under this Subsection 3(e)
shall be made by filing the prescribed form by the fifth working day of a Plan
Year with the local personnel office, and such transfer shall be made effective
the first day of that Plan Year. For purposes of accounting for such a
transfer, the value of the Participant's balance in the account or portion
thereof transferred shall be determined as of the Valuation Date preceding the
month when such transfer is effective. No Participant shall make more than one
such transfer during each Plan Year.
(f) Rollover Amount From Other Plans. An Eligible Employee, regardless of
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whether she has elected to otherwise participate in the Plan, may transfer to
the Trust Fund in cash a "Qualified Total Distribution," as defined in Section
402(a)(5)(E)(i) of the Code, if the distribution is from a plan which meets the
requirements of Section 401(a) of the Code (the "Other Plan"), subject to refund
upon any subsequent contrary determination by the Internal Revenue Service. The
procedures approved by UDLP shall provide that such a transfer may be made only
if the following conditions are met:
(i) the transfer occurs on or before the 60th day following the
Eligible Employee's receipt of the distribution from the Other Plan; and
(ii) the amount transferred is equal to any portion of the
distribution the Eligible Employee received from the Other Plan, subject to the
maximum rollover provision of Section 402(a)(5)(B) of the Code, limiting such
amount to the fair market value of all property received in the distribution
reduced by employee contributions, as defined in Section 402(a)(5)(D)(ii) of the
Code.
Notwithstanding the foregoing, if an Eligible Employee had deposited a
distribution previously received from an Other Plan into an individual
retirement account ("IRA"), as
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SECTION 3(f)(ii)
defined in Section 408 of the Code, she may transfer the amount of that
distribution, plus earnings on it, from the IRA to this Plan, but only if the
rollover amount is deposited with the Trustee on or before the 60th day
following receipt of it from the IRA.
UDLP shall develop such procedures, and may require such
information from an Eligible Employee desiring to make such a transfer, as it
deems necessary or desirable to determine that the proposed transfer will meet
the requirements of this Subsection. Upon approval by UDLP, the amount
transferred shall be deposited in the Trust Fund, credited to the Employee's
Employee-Elected Company Contributions Account, and invested entirely in the
Fixed Income Fund. Such Account shall be fully vested in the Eligible Employee,
shall share in the earnings and appreciation of the fund or funds in which it is
invested in accordance with Subsection 13(b), but shall not share in Company
Contributions and Forfeitures .
(g) Special Employee Contributions.
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(i) Election. A Participant who has no currently effective election
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of Employee-Elected Company Contributions or who has a currently effective
election of Employee-Elected Company Contributions equal to the Dollar Limit
(but less than 15% of his Earnings) may elect to make "Special Employee
Contributions." A Participant may, by filing the prescribed application form
with UDLP, elect a rate of Special Employee Contributions, in whole percentages
of his Earnings, of up to a percentage that when aggregated with the rate of his
Employee-Elected Company Contributions will equal 15% of his Earnings. Except as
provided in Subsection 18(i), such election shall be effective beginning with
the first payroll period occurring on or after the first of the calendar month
next following the date his application form is received by UDLP in the local
human resources office.
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SECTION 3(g)(ii)
(ii) Discontinuance. A Participant may elect at any time the
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discontinuance of future Special Employee Contributions, effective beginning
with the first payroll period occurring on or after the first of the calendar
month next following the date her election, on the prescribed form, is received
by UDLP by filing the form with the local personnel office. The right of a
Participant who makes such an election to make Special Employee Contributions
shall be suspended for a minimum period of six (6) months, and thereafter
Special Employee Contributions shall be resumed the first day of the first
payroll period following the 30th day after her election to resume Special
Employee Contributions is received by UDLP in the local human resources office,
on the prescribed application form.
(iii) Changing the Rate of Special Employee Contributions. A
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Participant may elect to change her rate of Special Employee Contributions to
any other rate available to her under Subsection 3(g)(i) above. Any election
under this Subsection 3(g)(iii) shall be made by filing the prescribed form with
the local personnel office and shall be effective beginning with the first
payroll period occurring on or after the first of the calendar month next
following the date her form is received by UDLP in the local human resources
office. No Participant shall make more than two elections under this Subsection
3(g)(iii) during any Plan Year, unless UDLP consents to any additional election
or elections.
(iv) Payroll Deductions. Special Employee Contributions shall be
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made only through periodic payroll deductions, unless UDLP consents to another
method of payment. Any commencement or discontinuance of withholding, or any
change in the rate of withholding, shall be effective on the first day of the
appropriate payroll period following the 30th day after the appropriate election
form is received by UDLP. All Special Employee Contributions withheld during a
calendar month shall be paid to the Trustee and credited to the appropriate
Special Employee Contributions Account as described in Section 14.
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SECTION 3(g)(v)
(v) Investment of Special Employee Contributions. A Participant's
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Special Employee Contributions shall be invested in the same manner as his
Employee-Elected Company Contributions (if any) as elected under Subsection
3(d). If the Participant has no currently effective election of Employee-
Elected Company Contributions, he may elect to invest his Special Employee
Contributions in the manner provided in Section 3(d).
Page 9
SECTION 4
SECTION 4. COMPANY CONTRIBUTIONS.
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(a) Company Contributions. For each calendar month, UDLP shall make a
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"Company Contribution." The amount of such contribution shall be equal to the
sum of the percentages, as set forth below, of (i) all Basic Contributions for
such month invested in the FMC Stock Fund and the Harsco Stock Fund, less the
Forfeitures (if any) which are credited against such contribution pursuant to
Subsection 8(b), and (ii) all Basic Contributions for such month invested in the
Fixed Income Fund and Equity Fund. UDLP shall determine such percentages for
any Plan Year prior to the beginning of such Plan Year by applying the following
schedule to the ratio of Profits to Average Invested Capital for the immediately
preceding calendar year:
Basic Contributions Invested in Stock Funds:
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Profits as Percentage of Company Contributions
Average Invested Capital: plus Forfeitures:
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Less than 6% 30% of Basic Contributions
6% or more but less than 6.5% 40% of Basic Contributions
6.5% or more but less than 7% 50% of Basic Contributions
7% or more but less than 7.5% 60% of Basic Contributions
7.5% or more but less than 8% 70% of Basic Contributions
8% or more 80% of Basic Contributions
Page 10
SECTION 4(a)
Basic Contributions Invested in Fixed Income Fund and Equity Fund:
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Profits as Percentage of Company Contributions
Average Invested Capital: plus Forfeitures:
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Less than 6% 15% of Basic Contributions
6% or more but less than 6.5% 20% of Basic Contributions
6.5% or more but less than 7% 25% of Basic Contributions
7% or more but less than 7.5% 30% of Basic Contributions
7.5% or more but less than 8% 35% of Basic Contributions
8% or more 40% of Basic Contributions
The Company shall communicate the rate of Company Contributions as part of the
first general communication to participants after such rate is determined.
(b) Allocation of Company Contributions and Forfeitures. The Company
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Contribution for any calendar month shall be paid to the Trustee as soon as
practicable, and such payment may include advance Company Contributions. The
Company Contribution, together with any current Forfeitures credited thereto,
but not including any advance Company Contributions, shall be allocated first to
the reinstatement of prior Forfeitures to which reemployed Participants may be
entitled under Subsection 8(b) and second to the payment of administrative
expenses payable out of the Trust Fund. The balance of such contributions and
current Forfeitures shall be apportioned among the Company Contributions
Accounts of all Participants who elected any Basic Contributions for such month
in the ratio that each Participant's Basic Contributions for such month bears to
the total Basic Contributions made by all Participants for such month. All
Company Contributions and Forfeitures allocated to Company Contributions
Accounts shall be invested in FMC Stock as part of the FMC Stock Fund.
Page 11
SECTION 5
SECTION 5. WITHDRAWALS.
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(a) Withdrawals from Special Employee Contributions. Any Participant may
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withdraw from her Special Employee Contributions Account the following amounts
in the order listed: (i) all or part of her Special Employee Contributions made
after March 31, 1986, and before January 1, 1987, (ii) all earnings or
appreciation attributable to Special Employee Contributions made after March 31,
1986, and before January 1, 1987, (iii) all or part of her Special Employee
Contributions made after December 31, 1986. Any participant may also withdraw
the following amounts in the order listed: (x) all earnings or appreciation
attributable to Special Employee Contributions made after December 31, 1986, and
(y) all of the current value of vested Company Contributions attributable to
Special Employee Contributions made after December 31, 1986. The active
participation of any Participant who makes a withdrawal under Subsections
5(a)(iii), (x), and (y) above shall be suspended until the first day of the
payroll period coinciding with or next following the date six months after the
first day of the month following the month in which the request to make a
withdrawal is effective, as defined in Subsection 5(f).
(b) Hardship Withdrawals. A Participant who encounters a "Financial
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Hardship," resulting in an immediate and heavy financial need, may withdraw an
amount necessary to satisfy that need, including, all or part of the following
amounts in the order listed: (i) the current value of his Special Employee
Contributions (if any) made before January 1, 1987, (ii) the current value of
his Special Employee Contributions made after December 31, 1986, (iii) the
current value of his aggregate Employee-Elected Company Contributions not
previously withdrawn, and the earnings on them as of December 31, 1988, and (iv)
the value of his Company Contributions Account as of December 31, 1988. UDLP
shall determine whether an event constitutes a Financial Hardship. Subject to
the review procedure described in Section 10, such determination shall be
conclusive and
Page 12
SECTION 5(b)
binding on all persons. The following expenditures will be conclusively
considered to be made on account of immediate and heavy financial need: (i)
medical expenses described in section 213(d) of the Code incurred by the
Participant, the Participant's spouse, or any dependents of the Participant (as
defined in section 152 of the Code); (ii) purchase (excluding mortgage payments)
of a principal residence for the Participant; (iii) payment of tuition for the
next semester or quarter of post-secondary education for the Participant, or the
Participant's spouse, children, or dependents; and (iv) expenditures to prevent
the eviction of the Participant from the Participant's principal residence or
foreclosure on the mortgage of the Participant's principal residence. In
determining whether a withdrawal is necessary to satisfy a financial need, UDLP
may reasonably rely upon the Participant's representation that the need cannot
be met by insurance, reasonable liquidation of assets (not itself creating a
hardship), cessation of Employee-Elected Company Contributions and Special
Employee Contributions, by other distributions or other nontaxable loans from
plans maintained by UDLP or any other employer, or by borrowing from commercial
sources on reasonable commercial terms. The Active Participation of any
Participant who makes this hardship withdrawal shall not be suspended, and the
unwithdrawn portion of his Company Contributions Account shall continue to vest.
(c) Age 59-1/2 Withdrawals. A Participant who has attained age 59-1/2 may
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withdraw his entire Special Employee Contributions Account (if any), his entire
Employee-Elected Company Contributions Account, and his entire Company
Contributions Account. A Participant who has an outstanding loan under Section
6 may not make such a withdrawal except upon repayment of the loan. Upon such a
withdrawal the Participant will not incur
Page 13
SECTION 5(C)
any suspension of Active Participation and will continue to have the right to
elect to make contributions to the Plan in the same manner he had prior to the
withdrawal.
(d) Election and Payment of Withdrawals. A request to make a withdrawal,
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and any election of a source of payment under Subsection 5(g) below, shall be
filed with the local personnel office on the prescribed form. A withdrawal
request is effective in the month in which the proper form is dated and signed,
provided the form is received by UDLP no later than the fifth working day of the
following month. Any withdrawal request form received after such fifth working
day shall be effective in the month in which received by UDLP. A hardship
withdrawal shall be paid as soon as practicable after valuation pursuant to
Subsection 5(f) below, and all other withdrawals shall be paid within 30 days
after valuation.
(e) Source of Payment. A Participant who, under Subsection 5(a),
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withdraws less than the entire value of his Special Employee Contributions
Account and who has interests in more than one investment fund may specify
whether such withdrawal shall be entirely from one fund or from more than one
fund in specified parts. The withdrawal from such Account shall not exceed the
Participant's aggregate Special Employee Contributions placed in each such
Account and not previously withdrawn.
(f) Form of Payment and Valuation Date. All withdrawals shall be paid in
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cash. The Participant's interest in the FMC Stock, Harsco Stock, Equity, and
Fixed Income Funds shall be valued as of the Valuation Date in the month in
which such withdrawal request is effective, as defined in Subsection 5(d).
(g) Limitation on Withdrawals. No withdrawal shall be in an amount less
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than the smaller of the entire vested interest or $250.00. A withdrawal from
any of the Participant's Accounts shall not include any portion of the Account
which has been loaned to the Participant under Section 6. No Participant may
make a withdrawal after the Plan is
Page 14
SECTION 5(g)
terminated pursuant to Section 15, and no Participant who has notice that the
Plan will be so terminated may make a withdrawal.
(h) Suspension for Withdrawal. The Active Participation of any Participant
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who makes a withdrawal from her Special Employee Contributions Account (other
than Special Employee Contributions made before January 1, 1987, and any
earnings or appreciation attributable to them) shall be suspended for six
months, as provided in Subsection 5(a). A Participant whose Active
Participation has been so suspended may resume Active Participation upon filing
the prescribed reinstatement form for such purpose with the local personnel
office. Such Active Participation shall be resumed the first day of the
appropriate payroll period beginning on or after the first day of the calendar
month immediately following the later of (i) the end of her suspension, or (ii)
the date her reinstatement form is received by UDLP. If reinstatement of Active
Participation is not elected on the prescribed form within 30 days after the
withdrawal suspension ends, the Participant will be treated as though she had
elected to discontinue future Employee-Elected Company Contributions.
SECTION 6
SECTION 6. LOANS.
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(a) Terms of Loans. Any Participant or Beneficiary who is a "party in
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interest" as to the Plan, as defined in Section 3(14) of ERISA, may borrow from
the Plan as provided in this Section 6. (References to Participants in this
Section shall include Beneficiaries). Loans shall not be made available to
highly compensated employees (as defined in section 414(q) of the Code) in an
amount greater than the amount made available to other employees. The minimum
amount that may be borrowed is $1,000, and higher amounts may be borrowed in
multiples of $500. The maximum amount that may be borrowed is the lesser of (i)
$50,000 (reduced by the highest outstanding loan balance of that Participant for
the prior 12 months) and (ii) 50 per cent of the Participant's vested Plan
Benefit. The period of repayment for any loan shall be five (5) years. A
Participant may prepay a loan in a lump sum on any date more than three (3)
months after the loan is made. Each loan shall be secured by the Participant's
Plan Benefit. For the purposes of determining the portion of a Participant's
Plan Benefit that is distributable by withdrawal or otherwise, and the portion
of a Participant's Accounts that are subject to the allocation of earnings,
appreciation, or depreciation, the amount of a loan will be deducted from the
Participant's accounts in the following order: (i) the Special Employee
Contributions Account (if any), (ii) the Employee-Elected Company Contributions
Account, (iii) the vested portion of the Company Contributions Account when the
loan is made. A partial deduction to an account will be allocated according to
the Participant's then current investment election. Each loan shall bear
interest at the Fixed Income Fund rate at the time the loan is made or other
reasonable rate of interest determined by UDLP at the time the loan is made.
Page 16
SECTION 6(b)
(b) Limitations on Loans. No loan shall be made to a Participant who has
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more than one outstanding loan, who UDLP determines to have insufficient monthly
net base pay to repay the loan, who has defaulted on a previous loan from the
Plan, or has borrowed from the Plan within the prior twelve (12) months.
(c) Loan Procedures. A Participant may apply for a loan by filing the
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prescribed application form with the local personnel office accompanied by any
processing fee established by UDLP. A borrowing Participant will be required to
sign a collateral promissory note secured by the Participant's Plan Benefit and
will receive a Federal Truth-In-Lending Disclosure Statement. A Participant's
accounts will be valued on the Valuation Date in the month in which the loan is
requested, and the loan will be disbursed as soon as practicable after that
Valuation Date.
(d) Repayment of Loans. Each loan will be repaid through payroll
------------------
deductions beginning with the first payroll period of the month following the
month in which the loan is disbursed. If a Participant's employment is suspended
such that the Participant is no longer receiving a paycheck, the Participant
shall make substantially level monthly loan repayments directly to the Plan.
Monthly loan payments of principal and interest will be credited to the accounts
of a Participant from which deducted in reverse of the order provided in
Subsection 6(a), but allocated among investment funds according to the
Participant's investment election when the repayment is made. A lump sum payment
will be credited among investment funds in proportion to its original deduction
from those funds. If a Participant ceases to be a party in interest as to the
Plan because his employment terminates or for any other reason, the loan will be
repaid within thirty (30) days after such cessation, and any outstanding loan
balance will be deducted from any distribution of the Participant's Plan
Benefit.
Page 17
SECTION 7
SECTION 7. VESTING.
-------------------
(a) Five-Year Vesting. A Participant shall become fully vested in his
------------------
entire Company Contributions Account when he completes five Years of Service.
(b) Graded Vesting. A Participant who is not fully vested under
--------------
Subsection 7(a) shall become vested in his Company Contributions Accounts, on
the first day following completion of a given Year of Service in accordance with
the following schedule:
Percentage of Company
Years of Service Contributions Accounts Vested
---------------- -----------------------------
Less than 2 0%
2 but less than 3 20%
3 but less than 4 40%
4 but less than 5 60%
(c) Full Vesting. Notwithstanding Subsections 7(a) and (b) above, a
-------------
Participant shall become vested in his entire Company Contributions Accounts if
one of the following events occurs:
(i) He attains age 55.
(ii) He becomes permanently and totally disabled as determined by
UDLP on the basis of competent medical evidence. Subject to the review procedure
described in Section 11, such determination shall be conclusive and binding upon
all persons.
(iii) He dies.
A Participant shall at all times be vested in his entire
Special Employee Contributions and Employee-Elected Company Contributions
Accounts.
Page 18
SECTION 8
SECTION 8. DISTRIBUTABLE INTERESTS AND FORFEITURES.
----------------------------------------------------
(a) Plan Benefits. If a Participant's employment with the Affiliated Group
--------------
terminates, if he becomes permanently and totally disabled, if he attains age
70-1/2, or if he elects under Subsection 9(g) to have his Plan Benefit
distributed to him, he will be entitled to receive (i) his entire Special
Employee Contributions Account, (ii) his entire Employee-Elected Company
Contributions Account, and (iii) the portion (if any) of his Company
Contributions Account that is vested under Section 7 as of the date when such
employment terminates.
(b) Forfeitures. If a Participant is not entitled to receive 100% of his
------------
Company Contributions Account under Subsection 7(a), (b), or (c) on the date
when his employment with the Affiliated Group terminates, the non-vested portion
shall be forfeited as of such date. If such Participant is reemployed by the
Affiliated Group within five (5) years from the date of termination, the
forfeited amount shall be reinstated to his Company Contributions Account and
may vest pursuant to Section 7. If such Participant terminates his employment
with the Affiliated Group a second time before he is 100% vested in his Company
Contributions Account, the amount payable from that account shall be computed as
follows:
(i) Add the amount of the prior payment from the account to current
balance of the account,
(ii) Apply the Participant's current vesting percentage (based upon
all his Years of Service) to the total obtained in (i) above.
(iii) Subtract from the amount obtained in (ii) above the amount of
the prior payment from the account.
Page 19
SECTION 8(b)(iii)
The result is the amount payable to him from that account. All
amounts which are forfeited during a calendar month shall be debited against the
appropriate Company Contributions Accounts and shall be credited to the Company
Contributions for the calendar month or months next following. Notwithstanding
the foregoing, if a Participant's termination of employment is due to a
"maternity or paternity leave," then this Subsection 8(b) shall be read by
substituting the number "six (6)" for the number "five (5)" wherever it appears
herein. For the purposes of this Plan, "maternity or paternity leave" means
termination of employment or absence from work due to the pregnancy of the
Participant, the birth of a child of the Participant, the placement of a child
in connection with the adoption of the child by a Participant, or the caring for
a Participant's child during the period immediately following the child's birth
or placement for adoption. UDLP shall determine, under rules of uniform
application and based on information provided to UDLP by the Participant,
whether or not the Participant's termination of employment or absence from work
is due to "maternity or paternity leave."
Page 20
SECTION 9
SECTION 9. FORM OF PLAN BENEFIT.
---------------------------------
(a) Normal Forms of Distribution.
-----------------------------
(i) Lump Sum Payment. A Participant's Plan Benefit shall be
----------------
distributed to him (or to his Beneficiary if such Participant dies before the
Distribution Date), unless an installment distribution is elected pursuant to
Subsection 9(b)(ii), in the form of a lump sum. Such distribution shall consist
of (i) a certificate for whole shares of FMC Stock, with a check for any
fractional share, representing his vested interest (if any) in the FMC Stock
Fund, (ii) is certificate for whole shares of Harsco Stock, with a check for the
value of his vested interest (if any) in the Harsco Stock Fund, (iii) a check
for the value of his interests (if any) in the Fixed Income Fund and the Equity
fund, and (iv) a check for the value of his vested interest in the FMC Stock
Fund and Harsco Stock Fund to the extent not previously invested in FMC or
Harsco Stock.
(ii) Valuation Date. For purposes of determining the amount of a lump
---------------
sum distribution under Subsection 9(a)(i) above, the value of the Participant's
interest in the FMC Stock, Harsco Stock, Fixed Income, and Equity Funds shall be
determined as of the Valuation Date next preceding the date of the distribution.
(iii) Distribution Date. A Participant's Plan Benefit shall be
------------------
distributed to such Participant (or to such Participant's Beneficiary if such
Participant has died before the Distribution Date) as soon as practicable after
the Participant's termination of employment, but not later than 60 days after
the close of the Plan Year in which such termination occurs, unless distribution
is deferred pursuant to Subsection 9(b). If a Participant attains age 70-1/2,
regardless of whether her employment terminates, her Plan Benefit shall be
distributed to her no later that April 1 of the Year following the Year in which
the Participant attains age 70-1/2.
Page 21
SECTION 9(a)(iii)
(b) Optional Form of Distribution.
------------------------------
(i) Participant's Election to Defer. With respect to a Participant
--------------------------------
whose employment terminates on or after her 55th birthday or whose Plan Benefit
is valued at not less than $3,500, the distribution or commencement of
distribution of the Participant's Plan Benefit (including the Participant's
share, if any, of the Company Contributions and Forfeitures for the Plan Year in
which the Participant's employment with the Affiliated Group terminates) will be
deferred to no later than April 1 of the Year following the Year in which the
Participant attains age 70-1/2 unless the Participant elects an immediate
distribution as provided in Subsection 9(a)(iii). A Participant may so defer a
portion of the Plan Benefit and receive an immediate distribution of the balance
of it. Such election must be filed with UDLP on the prescribed form before the
date such employment terminates, before the Participant dies, or before UDLP
determines that the Participant is permanently and totally disabled, as the case
may be, and shall, except as provided in Subsection 9(f), be irrevocable. If
such an election is not made properly in accordance with this paragraph, the
method of payment described in Subsection 9(a)(i) and (iii) shall be used.
(ii) Annual Installments. A Participant entitled to elect to defer
--------------------
distribution of his Plan Benefit under Subsection 9(b)(i) may elect to have the
distribution paid in cash over an installment period of not more than 10 years.
Such election must be filed with UDLP on the prescribed form before the date
employment terminates, before the Participant dies, or before UDLP determines
that the Participant is permanently and totally disabled, as the case may be,
and shall, except as provided in Subsection 9(f), be irrevocable. The election
shall specify the number of annual installments. If an installment election is
made, the Plan Benefit shall be distributed in annual installments as follows:
The amount of each annual installment shall be paid during the first month of
the year. The value of Stock and/or cash
Page 22
SECTION 9(b)(ii)
to be distributed in each installment shall be determined by dividing the amount
of Stock and/or cash credited to the Participant's Plan Benefit account as of
the date the installment is being paid by the total number of annual
installments elected minus the number of annual installments which have
previously been paid. The amount payable with respect to the Stock portion of
the installment shall be determined as of the Valuation Date immediately
preceding the date payment is made.
(iii) Valuation Date. The Plan Benefit of a Participant who makes an
---------------
election to defer distribution or to receive an installment distribution under
Subsections 9(b)(i) or (ii) above, shall remain invested in the Trust Fund in
the manner selected under Subsection 3(e) or (f) and shall be subject to the
earnings and appreciation or depreciation applicable thereto until the Valuation
Date preceding the final distribution month designated by the Participant.
(c) Participant's Election to Receive Cash. A Participant or Beneficiary
--------------------------------------
entitled to receive shares of Stock may instead elect to receive a check for the
value of all or part of the Participant's vested interest in the FMC or Harsco
Stock Fund plus a certificate for whole shares of FMC or Harsco Stock
representing the balance (if any) of such interest. Any such election shall be
filed with the local personnel office on the prescribed form on or before the
Participant's termination date if filed by the Participant, and if filed by a
Beneficiary, within 90 days after the Participant's death.
(d) Missing Persons. If UDLP and the Trustee shall be unable, within two
----------------
years after any amount becomes due and payable from the Plan to a Participant or
Beneficiary, to make payment because the identity or whereabouts of such person
cannot be ascertained, UDLP may mail a notice by registered mail to the last
known address of such person outlining the following action to be taken unless
such person makes written reply to UDLP within 60 days from the mailing of such
notice: UDLP may direct that amount and all
Page 23
SECTION 9(d)
further benefits with respect to such person shall be discontinued and all
liability for the payment thereof shall terminate; provided, however, that in
the event of the subsequent reappearance of the Participant or Beneficiary prior
to termination of the Plan, the benefits which were due and payable and which
such person missed shall be paid in a single sum, and the future benefits due
such person shall be reinstated in full. Any benefits discontinued as provided
above, including benefits attributable to Special Employee Contributions,
Employee-Elected Company Contributions, and Company Contributions, shall be
treated as a Forfeiture under Subsection 8(b).
(e) Payments to Beneficiary. A Beneficiary entitled to a distribution
-----------------------
under this Plan may ask that any unpaid Plan Benefit be distributed by one of
the forms of distribution specified in the foregoing provisions of this Section
9, subject to the approval of UDLP and to the following limitations:
(i) If the distribution of a Participant's Plan Benefit in
installments under Subsection 9(b)(ii) has begun and the Participant dies before
her entire Plan Benefit has been distributed to her, the remaining portion of
such interest shall be distributed at least as rapidly as under the installment
method selected as of her date of death.
(ii) If a Participant dies before she has begun to receive any
distributions of her Plan Benefit, her death benefit shall be distributed to her
Beneficiaries within 5 years after her death.
(iii) The 5-year distribution requirement of Subsection 9(e)(ii) shall
not apply to any portion of the deceased Participant's Plan Benefit which is
payable to or for the benefit of a designated Beneficiary. For purposes of this
Subsection 9(e), "designated Beneficiary" shall include any person to whom a
Participant's Plan Benefit is paid pursuant to Subsection 18(c). In such event,
such portion may be distributed in not more than 10 annual installments,
provided such distribution begins not later than one (1) year after the
Page 24
SECTION 9(e)(iii)
date of the Participant's death (or such later date as may be prescribed by
Treasury regulations).
Except, however, in the event the Participant's spouse is her
Beneficiary, the requirement that distributions commence within one year of a
Participant's death shall not apply. In lieu thereof, such distribution must
commence no later than the date on which the deceased Participant would have
attained age seventy and one-half (70 1/2). If the surviving spouse dies before
the distributions to such spouse begin, then the 5-year distribution requirement
of Subsection 9(e)(ii) shall apply as if the spouse were the Participant.
(f) Change of Election. Any Participant (or the Participant's Beneficiary
-------------------
if the Participant has died) who has made an election to defer distribution or
to receive an installment distribution (whether or not such installment payments
have commenced) under Subsections 9(b)(i) or (ii) above, may subsequently elect
to have the entire amount then credited to the Participant's Plan Benefit
account distributed immediately in a lump sum or elect to have installment
payments commence in a year earlier than the year originally elected. Any other
type of change in a Participant's or Beneficiary's deferral election, including
without limitation, the earlier distribution of part of the amount credited to a
Participant's Plan Benefit account, a change from lump sum payments to
installment payments or the postponement of a distribution or the commencement
of installment payments, may be made only with the approval of UDLP.
(g) Foreign Transfers. Any Participant who transfers from employment with
------------------
the Company to employment with a foreign corporation that is a member of the
Affiliated Group, but is not a participating company in this Plan, may elect to
be treated as having terminated employment with the Affiliated Group for
purposes of this Section 9 and to be entitled to a distribution of her Plan
Benefit. Such election may be made at any time on or
Page 25
SECTION 9(g)
after the date of the transfer of employment and before the Participant's death,
permanent and total disability, or actual termination of employment with the
Affiliated Group, and the Participant's distribution options under this Section
9 shall be determined as of the effective date of that election.
Page 26
SECTION 10
SECTION 10. CLAIM PROCEDURE.
-----------------------------
(a) Application for Benefits. Any application for benefits under the Plan
-------------------------
and all inquiries concerning the Plan shall be submitted to UDLP. Applications
for benefits shall be in writing on the form prescribed by UDLP and shall be
signed by the Participant or, in the case of a benefit payable after the death
of the Participant, by the Participant's Beneficiary.
(b) Denial of Applications. Within a reasonable period of time after UDLP
-----------------------
receives an application, it shall give written notice to the applicant of its
decision on the application. In the event any application for benefits is
denied in whole or in part, UDLP shall notify the applicant in writing of the
right to a review of the denial. Such written notice shall set forth, in a
manner calculated to be understood by the applicant, specific reasons for the
denial, specific references to the Plan provisions on which the denial is based,
a description of any information or material necessary to perfect the
application, an explanation of why such material is necessary and an explanation
of the Plan's review procedure.
Page 27
SECTION 11
SECTION 11. APPEAL PROCEDURE.
------------------------------
(a) The Review Panel. FMC shall appoint a "Review Panel" which shall
----------------
consist of three or more individuals who may (but need not) be employees of
UDLP. The Review Panel shall be the named fiduciary which has the authority to
act with respect to any appeal from a denial of benefits under the Plan.
(b) Requests for a Review. Any person whose application for benefits is
----------------------
denied in whole or in part (or the applicant's authorized representative) may
appeal from the denial by submitting to the Review Panel a request for a review
of the application within three months after receiving written notice of the
denial. UDLP shall give the applicant or such representative an opportunity to
review pertinent materials (other than legally privileged documents) in
preparing such request for review. The request for review shall be in writing
and addressed as follows: "FMC Employee Welfare Benefits Plan Committee, 200
East Randolph Drive, Chicago, Illinois 60601." The request for review shall set
forth all of the grounds on which it is based, all facts in support of the
request and any other matters which the applicant deems pertinent. The Review
Panel may require the applicant to submit such additional facts, documents or
other material as it may deem necessary or appropriate in making its review.
(c) Decision on Review. The Review Panel shall act upon each request for
-------------------
review within 60 days after receipt thereof unless special circumstances require
further time for processing, but in no event shall the decision on review be
rendered more than 120 days after the Review Panel receives the request for
review. The Review Panel shall give prompt, written notice of its decision to
UDLP and to the applicant. In the event the Review Panel confirms the denial of
the application for benefits in whole or in part, such notice shall set forth,
in a manner calculated to be understood by the applicant, the specific reasons
for such denial and specific references to the Plan provisions on which the
decision was based.
Page 28
SECTION 11(d)
(d) Rules and Procedures. The Review Panel shall establish such rules and
---------------------
procedures, consistent with ERISA and the Plan, as it may deem necessary or
appropriate in carrying out its responsibilities under this Section 11.
(e) Exhaustion of Remedies. No legal or equitable action for benefits
----------------------
under the Plan shall be brought unless and until the claimant (i) has submitted
a written application for benefits in accordance with Subsection 10(a), (ii) has
been notified by UDLP that the application is denied, (iii) has filed a written
request for a review of the application in accordance with Subsection 11(b)
above, and (iv) has been notified in writing that the Review Panel has affirmed
the denial of the application; provided that legal action may be brought after
the Review Panel has failed to take any action on the claim within the time
prescribed in Subsections 10(b) or 11(c) above.
Page 29
SECTION 12
SECTION 12. ADMINISTRATION AND OPERATION OF THE PLAN.
------------------------------------------------------
(a) Administrative Responsibilities. FMC is the "plan sponsor" and the
--------------------------------
"administrator" of the Plan, as such terms are used in ERISA. UDLP is the named
fiduciary which has the authority to control and manage the operation and
administration of the Plan. UDLP shall make such rules, regulations,
interpretations, and computations and shall take such other action to administer
the Plan as it may deem appropriate, in its sole discretion, and, subject to the
provisions of Section 11, any interpretation of the provisions of the Plan and
any decision on any matter within its discretion as Plan administrator made by
UDLP in good faith shall be conclusive and binding on all persons. In
administering the Plan, UDLP shall act in a nondiscriminatory manner to the
extent required by Section 401(a) and related sections of the Code and shall at
all times discharge its duties with respect to the Plan in accordance with the
standards set forth in Section 404(a)(1) of ERISA.
(b) Appointment of Trustees. UDLP is the named fiduciary which has the
------------------------
authority to appoint one or more Trustees to hold all assets of the Plan in
Trust. UDLP shall enter into a Trust Agreement with respect to the assets to be
held in trust thereunder with each Trustee it appoints.
(c) Delegation of Fiduciary Responsibilities. UDLP may engage such
-----------------------------------------
attorneys, actuaries, accountants and consultants to render advice or to perform
services with regard to its responsibilities under the Plan as it shall
determine to be necessary or appropriate. UDLP may designate by written
instrument one or more actuaries, accountants or consultants as fiduciaries to
carry out, where appropriate, its fudiciary responsibilities.
Page 30
SECTION 12(c)
UDLP's duties and responsibilities under the Plan shall be carried out
by its directors, officers and employees, acting on behalf of and in the name of
UDLP in their capacity as directors, officers, and employees and not as
individual fiduciaries. Except as provided in Subsection 11(a) (Review Panel),
no director, officer, or employee of UDLP shall be a fiduciary with respect to
the Plan unless he is specifically so designated and expressly accepts such
designation.
Page 31
SECTION 13
SECTION 13. FUNDING OF THE PLAN.
---------------------------------
(a) Funding Policy and Method. UDLP from time to time shall estimate the
--------------------------
benefits, withdrawals, and administrative expenses to be paid out of the Trust
Fund in cash during the period for which the estimate is made and shall also
estimate the contributions to be made to the Plan during such period by
Participants and by UDLP. UDLP shall inform the Trustee of the estimated cash
needs of and contributions to the Plan during the period for which such
estimates are made. Such estimates shall be made on an annual, quarterly,
monthly, or other basis, as UDLP shall determine.
(b) Public Accountant. UDLP shall engage an independent qualified public
------------------
accountant to conduct such examinations and to render such opinions as are
required by Section 103(a)(3) of ERISA. UDLP in its discretion may remove and
discharge the person so engaged, but in such case it shall engage a successor
independent qualified public accountant to perform such examinations and to
render such opinions.
(c) Basis of Payments to the Plan. Each Participant whose participation is
------------------------------
not suspended may elect to have UDLP make Employee-Elected Company Contributions
as provided in Section 3. UDLP shall make Company Contributions as provided in
Section 4; provided, however, that this obligation of UDLP shall cease when the
Plan is terminated. In the case of a partial termination of the Plan, this
obligation shall cease with respect to the Participants and Beneficiaries who
are affected by such partial termination. All Employee-Elected Company
Contributions and all Company Contributions shall be paid to the Trustee within
the periods of time specified herein.
Page 32
SECTION 13(d)
(d) Basis of Payments from the Plan. All benefits and withdrawals payable
--------------------------------
under the Plan shall be paid by the Trustee pursuant to the directions of UDLP
and the terms of the Trust Agreement. The Trustee shall pay all expenses of the
Plan out of the Trust Fund, except that UDLP shall pay expenses that cannot be
charged to the Trust under applicable law.
(e) Investment of Trust Assets. The Trustee shall invest in the FMC Stock,
---------------------------
Harsco Stock, Fixed Income or Equity Fund all amounts which are paid to it with
respect to the Plan, less the amount of any administrative expenses payable out
of the Trust Fund under Subsection 13(d) above. Company Contributions shall be
invested in the FMC Stock Fund, and dividends or other earnings attributable
thereto shall be allocated and credited pro rata to shares held by the
Participant. Employee-Elected Company Contributions shall be invested in the
FMC Stock, Harsco Stock, Fixed Income, or Equity Fund pursuant to the directions
of the Participants as conveyed to the Trustee by the Company. Interest,
dividends, other earnings, and proceeds from sales attributable to the Fixed
Income Fund and the Equity Fund shall be reinvested in the Fixed Income Fund and
the Equity Fund, respectively. The Trustee shall invest the Fixed Income Fund
and the Equity Fund as directed by UDLP, except that (1) the Fixed Income Fund
shall be invested and reinvested only (A) in guaranteed income contracts and
similar products, if any, guaranteeing repayment of principal in full together
with interest at a fixed or fixed minimum rate, whether issued by an insurance
company or other financial institution, (B) securities issued or guaranteed by
the United States of America or any agency or instrumentality thereof, or, (C)
pending investment in the contracts or securities described in (A) and (B), in
any of the debt obligations described in the following sentence, and (2) the
Equity Fund shall be invested and reinvested only in shares of mutual funds
registered
Page 33
SECTION 13(e)
under the Investment Company Act of 1940, or, pending investment in such mutual
fund shares, in any of the debt obligations described in the following sentence.
Pending investment in Stock, the Trustee may invest any amounts to be placed in
the Stock Funds in any common, group or collective investment trust that is
maintained by the Trustee and that provides for the pooling or commingling of
the assets of plans described in section 401(a) and exempt from tax under
section 501(a) of the Code, or in short-term, interest-bearing debt obligations,
including (without limitation except as stated) savings accounts, certificates
of deposit, banker's acceptances, commercial paper of institutions having a
short-term commercial paper rating of A-1, P-1 from Standard & Poor's and
Moody's, and United States Treasury Bills and Notes. The form of such temporary
investments shall be at the exclusive discretion of the Trustee.
Page 34
SECTION 14
SECTION 14. PARTICIPANTS' ACCOUNTS
-----------------------------------
(a) Participants' Accounts. For each Participant, UDLP will maintain,
----------------------
where applicable, a Special Employee Contributions Account, an Employee-Elected
Company Contributions Account, and a Company Contributions Account in the Stock
Fund, Fixed Income Fund, or Equity Funds in accordance with her currently
effective investment election. Subject to the provisions of Subsection 14(c),
the amount of Employee-Elected Company Contributions and Special Employee
Contributions (if any) withheld from Earnings during the Plan Year will be
allocated to each Participant's Employee-Elected Company Contributions Account
and Special Employee Contributions Account as of the end of each calendar month,
and the Company Contribution for each Participant for each Plan Year will be
allocated to her Company Contributions Account as of the end of each calendar
month.
UDLP shall maintain records relative to a Participant's accounts so
that the current value of her accounts in the Fixed Income Fund, the Stock
Funds, and the Equity Fund may be determined as of any month's end.
(b) Rules Relating to Plan Investments and Earnings Adjustments. The Fixed
------------------------------------------------------------
Income Fund, Stock Funds, and Equity Fund shall be invested by the Trustee as
provided in Section 13(e) and in the Trust Agreement. Each such fund will be
valued at the fair market value thereof as of the close of business on each
Valuation Date as prescribed in Section 5 or 9 (and at such other dates as may
be requested by UDLP) before adding Employee-Elected Company Contributions and
Special Employee Contributions thereto as of such date by adding (i) the fair
market value of all securities and contracts held in each such fund, (ii) any
accrued interest or declared dividends on such investments in the Stock Funds
not reflected in (i) above, and (iii) an amount equal to the cash then held in
each such fund; and subtracting there from any liabilities of each such fund.
Participants' accounts in each such
Page 35
SECTION 14(b)
fund will be adjusted as of the close of business on each Valuation Date as
prescribed in Section 5 or 9 to equal the fair market value of each fund on that
day as determined above.
Withdrawals shall be made in cash, and distributions shall be made from
each such fund only as of the first day of the month.
The amount to be paid upon such a withdrawal distribution shall be based
on the value, as determined by UDLP, of the Participant's account as of the
Valuation Date prescribed in Section 5 or 9. If the Plan Benefit is payable in
installments as provided by Section 9(b)(iii), the remaining unpaid balance
shall be revalued as of each Valuation Date preceding the due date of each
installment. The unpaid Plan Benefit shall be a liability of each such fund as
of the Valuation Date prescribed in Section 5 or 9.
(c) Stock Funds. The Trustee shall on a reasonably current basis apply all
------------
cash, attributable to the Stock Funds, except any cash needed to satisfy current
cash flow requirements, to the acquisition of Stock of FMC or Harsco as the case
maybe.
(i) As of each Valuation Date, UDLP shall allocate any net amount
contributed to the Company Contributions Account, the Special Employee
Contributions Account (if any), and the Employee-Elected Company Contributions
Account of each Participant for which it was contributed. Such crediting of
contributions shall be effected initially by posting dollar credits to the
appropriate accounts. Dollar credits to a Participant's Company Contributions
Account, Special Employee Contributions Account, or Employee-Elected Company
Contributions Account shall (unless and until converted) constitute the cash
distribution value to her of her share in the unassigned assets of the Trust
Fund. Such dollar credits, however, shall as promptly as practicable after
posting thereof (but in no event after such Participant's termination of
employment) be converted into Stock credits by assigning to such account, in
substitution for such dollar credits, but subject to such conditions regarding
distribution as are provided in this Plan, shares of Stock upon the
Page 36
SECTION 14(c)(i)
basis of the average cost of such shares available for this purpose. As soon as
convenient, and at least annually, UDLP in connection with the account statement
described in Subsection 18(h), shall furnish to each Participant a statement
showing the amounts and cost basis of Stock assigned and the dollar credits
posted to her Special Employee Contributions Account (if any), her Company
Contributions Account, and Employee-Elected Company Contributions Account, which
statement shall be cumulative from year to year so that such statement shall
show the total credit to the Participant's accounts.
(ii) Amounts equal (after appropriate adjustment for any withholding
which may be required by an applicable tax law) to the amounts of dividends on
shares of Stock assigned to the Participant's Company Contributions Account,
Special Employee Contributions Account, or Employee-Elected Company
Contributions Account shall be paid to the Trustee during such Plan Year and
shall remain in the Stock Funds and be credited to her Company Contributions
Account, Special Employee Contributions Account, or Employee-Elected Company
Contributions Account. Such crediting shall be effected by posting to her
account dollar credits which shall be separate from but added to the dollar
credits resulting from contributions and deposits and which shall be convertible
into Stock credits as hereinabove provided (but in no event after such
Participant's termination of employment).
Page 37
SECTION 15
SECTION 15. AMENDMENT AND TERMINATION OF THE PLAN.
---------------------------------------------------
(a) Future of the Plan. UDLP expects to continue the Plan indefinitely.
-------------------
Future conditions, however, cannot be foreseen, and UDLP retains the authority
to amend or to terminate the Plan at any time and for any reason.
(b) Amendments. No amendment of the Plan shall (i) reduce the benefit of
-----------
any Participant accrued under the Plan before such amendment is adopted or (ii)
divert any part of the assets of the Plan to purposes other than the exclusive
purpose of providing benefits to the Participants and Beneficiaries who have an
interest in the Plan and of defraying the reasonable expenses of administering
the Plan and the Trust Fund. For the purposes of this Section, a Plan amendment
which has the effect of eliminating or reducing an early retirement benefit or
eliminating an optional form of benefit (as provided in Treasury regulations)
shall be treated as reducing the benefit of a Participant accrued under the
Plan.
(c) Termination of the Plan. Upon termination of the Plan, no part of the
------------------------
Trust Fund shall revert to the Company or be used for or diverted to purposes
other than the exclusive purpose of providing benefits to the Participants and
Beneficiaries who have an interest in the Plan and of defraying the reasonable
expenses of administering the Plan and such termination. Upon termination of
the Plan or upon complete discontinuance of Company Contributions, each
Participant shall become vested in his entire Company Contributions Account.
Upon termination of the Plan, the Trust shall continue until the Trust Fund has
been distributed as provided in Subsection 15(d) below. Any other provision
hereof notwithstanding, the Company shall have no obligation to continue
contributions to the Plan after termination of the Plan. Except as otherwise
provided in ERISA, neither the Company nor any other person shall have any
liability or obligation
Page 38
SECTION 15(c)
to provide benefits hereunder after such termination. Upon such termination,
Participants and Beneficiaries shall obtain benefits solely from the Trust Fund.
Upon partial termination of the Plan, this Subsection 15(c) shall apply only
with respect to such Participants and Beneficiaries as are affected by such
partial termination.
(d) Allocation of Trust Fund Upon Termination. Upon termination of the
------------------------------------------
Plan, the interest of each Participant in the Plan shall be distributed to him
as provided herein, subject to Section 403(d)(1) of ERISA.
Page 39
SECTION 16
SECTION 16. CONTRIBUTION LIMITATIONS.
--------------------------------------
(a) Limitation of Allocations.
--------------------------
(i) Deferral Percentage. The Employee-Elected Company Contributions
--------------------
and the Company Contributions (and a pro rata share of the investment earnings
attributable to each) allocated to a Participant shall be reduced if necessary
to comply with the deferred percentage limitations of Subsection 401(k)(3) of
the Code (a copy of which is attached as Exhibit A). Whether such reduction is
necessary shall be determined for each Year. Any such reduction shall be
effected by reducing first, Employee-Elected Company Contributions, then (if
necessary), the Company Contributions, allocated to Participants who are "highly
compensated employees" of the Company (as defined in Section 414(q) of the Code)
and whose "actual deferral percentage" (as defined in Section 401(k)(3)(B) of
the Code) exceeds the permissible actual deferral percentage for highly
compensated employees, commencing with those Participants whose actual deferral
percentage is highest. The amount of any Participant's Employee-Elected Company
Contributions reduced retroactively shall be paid to her in cash within two and
one-half (2-1/2) months after the close of the Plan Year. Alternatively, to the
extent provided in Treasury Regulations, UDLP may elect or permit the
Participant to elect to treat all or a portion of the amount of excess Employee-
Elected Company Contributions as an amount distributed to the Participant and
then contributed by the Participant to the Plan.
(ii) Contribution Percentage. The Special Employee Contributions and
------------------------
the Company Contributions (and a pro rata share of the earnings attributable to
each) allocated to a Participant shall be reduced if necessary to comply with
the contribution percentage limitations of Subsection 401(m) of the Code (a copy
of which is attached as Exhibit B).
Page 40
SECTION 16(a)(ii)
Whether such reduction is necessary shall be determined for each Year. Any such
reduction shall be effected by reducing first, Special Employee Contributions,
then (if necessary), the Company Contributions, allocated to Participants who
are "highly compensated employees" of the Company (as defined in Section 414(q)
of the Code) and whose "contribution percentage" (as defined in Section 401(m)
of the Code) exceeds the permissible contribution percentage for highly
compensated employees, commencing with those Participants whose contribution
percentage is highest. The amount of any Participant's Special Employee
Contributions and Company Contributions reduced retroactively shall be paid to
him in cash within two and one-half (2-1/2) months after the close of the Plan
Year.
(b) Maximum Annual Additions.
-------------------------
(1) Notwithstanding the foregoing, the maximum Annual Additions
credited to a Participant's accounts for any Plan Year shall equal the lesser
of: (A) $30,000 or, if greater, one-fourth (1/4) of the defined benefit dollar
limitation as provided in Code Section 405(b)(1) for the Plan Year, or (B)
twenty-five percent (25%) of the Participant's 415 Compensation for such Plan
Year.
(2) For purposes of applying the limitations of Code section 415,
"Annual Additions" means the sum credited to a Participant's accounts for any
Plan Year of (A) Company 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)(1) which is part of a
defined benefit plan maintained by the Affiliated Group and (E) amounts derived
from contributions paid or accrued after December 31, 1985, in taxable years
ending after such date, which are attributable to the post-retirement medical
benefits allocated to the separate account of a five percent owner (as defined
in Code section 416(i)1(B)(i) under a welfare benefit plan (as defined in Code
section 419(e)) maintained by the Affiliated Group.
Page 41
SECTION 16(b)(3)
(3) For purposes of applying the limitations of Code section 415, the
following are not "Annual Additions": (A) transfer of funds from one qualified
plan to another; (B) rollover contributions (as defined in Code sections
402(a)(5), 403(a)(4), 408(d)(3) and 409(b)(3)(C)); (C) repayments of loans made
to a Participant from the Plan; (D) repayments of distributions received by a
Participant pursuant to Code section 411(a)(7)(B) (cash-outs); (E) repayments of
distributions received by a Participant pursuant to Code section 411(A)(3)(D)
(mandatory contributions); (F) employee contributions to a simplified employee
pension allowed as a deduction under Code section 219(a); and (G) deductible
employee contributions to a qualified Plan.
(4) For purposes of applying the limitations of Code section 415, "415
Compensation" shall include the Participant's wages, salaries, fees for
professional service and other amounts for personal services actually rendered
in the course of employment with the Company not in excess of $200,000
(including, but not limited to, commissions paid salesmen, compensation for
services on the basis of a percentage of profits, commissions on insurance
premiums, tips and bonuses and in the case of a Participant who is an Employee
within the meaning of Code section 401(c)(1) and the regulations thereunder, the
Participant's earned income (as described in Code section 401(c)(2) and the
regulations thereunder)) paid during the Plan Year. "415 Compensation" shall
exclude (A)(i) contributions made by the Company to a plan of deferred
compensation to the extent that, before the application of the Code section 415
limitations to the Plan, the contributions are not includable in the gross
income of the Participant for the taxable year in which contributed, (ii)
Company contributions made on behalf of a Participant to a simplified employee
pension plan described in Code section 408(k) to the extent such contributions
are deductible by the Participant under Code section 219(a), (iii) any
distributions from a plan
Page 42
Section 16(b)(A)
of deferred compensation regardless of whether such amounts are includable in
the gross income of the Participant when distributed except that any amounts
received by a Participant pursuant to an unfunded non-qualified plan to the
extent such amounts are includable in the gross income of the Participant; (B)
amounts realized from the exercise of a non-qualified stock option or when
restricted stock (or property) held by a Participant either becomes freely
transferable or is no longer subject to a substantial risk of forfeiture; (C)
amounts realized from the sale, exchange or other disposition of stock acquired
under a qualified stock option; and (D) other amounts which receive special tax
benefits, such as premiums for group term life insurance (but only to the extent
that the premiums are not includable in the gross income of the Participant), or
contributions made by the Company (whether or not under a salary reduction
agreement) towards the purchase of any annuity contract described in Code
section 403(b) (whether or not the contributions are excludable from the gross
income of the Participant).
(5) The limitation stated in Subsection 16(b)(l)(i) above shall be
adjusted annually as provided in Code section 415(d) pursuant to the regulations
prescribed by the Secretary of the Treasury. The adjusted limitation is
effective as of January 1st of each calendar year and is applicable to Plan
Years ending with or within that calendar year.
(6) For the purpose of this Section, all qualified defined benefit
plans (whether terminated or not) ever maintained by the Affiliated Group shall
be treated as one defined benefit plan, and all qualified defined contribution
plans (whether terminated or not) ever maintained by the Affiliated Group shall
be treated as one defined contribution plan.
Page 43
SECTION 16(b)(7)(A)
(7)(A) If a Participant participates in more than one defined
contribution plan maintained by the Affiliated Group which have different plan
years, the maximum Annual Additions under this Plan shall equal the maximum
Annual Additions for the Plan Year minus any Annual Additions previously
credited to such Participant's accounts during the Plan Year.
(7)(B) If a Participant participates in both a defined contribution
plan subject to Code section 412 and a defined contribution plan not subject to
Code section 412 maintained by the Affiliated Group which have the same plan
year, Annual Additions will be credited to the Participant's accounts under the
defined contribution plan subject to Code section 412 prior to crediting Annual
Additions to the Participant's accounts under the defined contribution plan not
subject to Code section 412.
(7)(C) If a Participant participates in more than one defined
contribution plan not subject to Code section 412 maintained by the Affiliated
Group which have the same plan year, the maximum Annual Additions under this
Plan shall equal the product of (i) the maximum Annual Additions for the Plan
Year minus any Annual Additions previously credited under subparagraphs (A) or
(B) above, multiplied by (ii) a fraction (I) the numerator of which is the
Annual Additions which would be credited to such Participant's accounts under
this Plan without regard to the limitations of Code section 415 and (II) the
denominator of which is such Annual Additions for all plans described in this
subparagraph.
(8) Subject to the exception in Section 16(b)(13) below, if an Employee
is (or has been) a Participant in one or more defined benefit plans and one or
more defined contribution plans maintained by the Affiliated Group, the sum of
the defined benefit plan fraction and the defined contribution plan fraction for
any Plan Year may not exceed 1.0.
Page 44
SECTION 16(b)(9)(A)
(9)(A) The "Defined Benefit Plan Fraction" for any Plan Year is a
fraction (i) the numerator of which is the "projected annual benefit" of the
Participant under the Plan (determined as of the close of the Plan Year), and
(ii) the denominator of which is the greater of the product of 1.25 multiplied
by the "protected current accrued benefit" or the lesser of: (I) the product of
1.25 multiplied by the maximum dollar limitation provided under Code section
415(b)(1)(A) for such Plan Year, or (II) the product of 1.4 multiplied by the
amount which may be taken into account under Code section 415(b)(1)(B) for such
Plan Year.
(9)(B) For purposes of applying the limitations of Code section 415,
the "projected annual benefit" for any Participant is the benefit, payable
annually, under the terms of the Plan determined pursuant to Regulation 1.415-
7(b)(3).
(9)(C) For purposes of applying the limitations of Code section 415,
"protected current accrued benefit" for any Participant in a defined benefit
plan in existence on July 1, 1982, shall be the accrued benefit, payable
annually, provided for under question T-3 of Internal Revenue Service Notice 83-
10.00 (10)(A) The "Defined Contribution Plan Fraction" for any Plan Year is a
fraction (i) the numerator of which is the sum of the Annual Additions to the
Participant's accounts as of the close of the Plan Year and (ii) the denominator
of which is the sum of the lesser of the following amounts determined for such
year and each prior year of service with the Affiliated Group: (I) the product
of 1.25 multiplied by the dollar limitation in effect under Code section
415(c)(1)(A) for such Plan year (determined without regard to Code section
415(c)(6)), or (II) the product of 1.4 multiplied by the amount which may be
taken into account under Code section 415(c)(1)(B) for such Plan Year.
Page 45
SECTION 16(b)(10)(B)
(B) Notwithstanding the foregoing, the numerator of the Defined
Contribution Plan Fraction shall be adjusted pursuant to Regulation 1.415-
7(d)(1) and questions T-6 and T-7 of Internal Revenue Service Notice 83-10.
(C) For defined contribution plans in effect on or before July 1,
1982, the Company may elect, for any Plan Year ending after December 31, 1982,
that the amount taken into account in the denominator for every Participant for
all Plan Years ending before January 1, 1983 shall be an amount equal to the
product of (i) the denominator for the Plan Year ending in 1982 determined under
the law in effect for the Plan Year ending in 1982 multiplied by (II) the
Transition Fraction.
(D) For purposes of the preceding paragraph, the term Transition
Fraction shall mean a fraction (i) the numerator of which is the lesser of (I)
$51,875 or (II) 1.4 multiplied by twenty-five percent (25%) of the Participant's
415 Compensation for the Plan Year ending in 1981, and (ii) the denominator of
which is the lesser of (I) $41,500 or (II) twenty-five percent (25%) of the
Participant's 415 Compensation for the Plan Year ending in 1981.
(E) Notwithstanding the foregoing, for any Plan Year in which the
Plan is a Top Heavy Plan, $41,500 shall be substituted for $51,875 in
determining the Transition Fraction unless the extra minimum allocation is being
provided pursuant to Section 17(c). However, for any Plan Year in which this
Plan is a Super Top Heavy Plan, $41,500 shall be substituted for $51,875 in any
event.
(11) Notwithstanding the foregoing, for any Plan Year in which the
Plan is a Top Heavy Plan, 1.0 shall be substituted for 1.25 in Subsections
16(b)(9)(A) and 16(b)(10)(A) unless the extra minimum allocation is being
provided pursuant to Section 17(c). However, for any Plan Year in which the Plan
is a Super Top Heavy Plan, 1.0 shall be substituted for 1.25 in any event.
Page 46
SECTION 16(b)(12)
(12) If the sum of the Defined Benefit Plan Fraction and the Defined
Contribution Plan Fraction shall exceed 1.0 in any Plan Year for any Participant
in this Plan for reasons other than described in Subsection 16(b)(13) below, the
Company shall adjust, to the extent necessary, the numerator of the Defined
Benefit Plan Fraction for such Plan Year. If, after adjusting the numerator of
the Defined Benefit Plan Fraction for the Plan Year, the sum of the Defined
Benefit Plan Fraction and the Defined Contribution Plan Fraction still exceed
1.0, the Company shall then limit the Annual Additions to such Participant's
accounts so that the sum of both fractions shall not exceed 1.0 in any Plan Year
for such Participant.
(13) If (A) the substitution of 1.00 for 1.25 and $41,500 for
$51,875 above or (B) the excess benefit accruals or Annual Additions provided
for in Internal Revenue Service Notice 82-19 cause the 1.0 limitation to be
exceeded for any Participant in any Plan Year, such Participant shall be subject
to the following restrictions for each future Plan Year until the 1.0 limitation
is satisfied: (i) the Participant's accrued benefit under the defined benefit
plan shall not increase (ii) no Annual Additions may be credited to a
Participant's accounts and (iii) no employee contributions (voluntary or
mandatory) shall be made under any defined benefit plan or any defined
contribution plan of the Affiliated Group.
(c) Adjustment For Excessive Annual Additions.
-----------------------------------------
(1) If as a result of the allocation of Forfeitures, 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, the Annual
Additions under this Plan would cause the maximum Annual Additions to be
exceeded for any Participant, the Company shall (A) return any voluntary
employee contributions credited for the Plan year to the extent that the return
would reduce the "excess amount" in the Participant's accounts (B) hold any
"excess amount" remaining after the return of any voluntary employee
contributions
Page 47
SECTION 16(c)(1)
in a Section 415 Suspense Account (C) allocate and reallocate the
Section 415 Suspense Account in the next Plan Year (and succeeding Plan Years if
necessary) to all Participants in the Plan before any Company or employee
contributions which would constitute Annual Additions are made to the Plan for
such Plan Year (D) reduce Company contributions to the Plan for such Plan Year
by the amount of the Section 415 Suspense Account allocated and reallocated
during such Plan Year. Company Contributions and Forfeitures for a given Year
in the Section 415 Suspense Account will be allocated to the Company
Contributions Accounts of Participants in proportion to the amount of Employee-
Elected Company contributions made by such Participants for such Year.
(2) For purposes of this Section, "excess amount" for any Participant
for a Plan Year shall mean the excess, if any, of (A) the Annual Additions which
would be credited to his account under the terms of the Plan without regard to
the limitations of Code section 415 over (B) the maximum Annual Additions
determined pursuant to Section 16(b).
(3) For purposes of this Section, "Section 415 Suspense Account"
shall mean an unallocated account equal to the sum of "excess amounts" for all
Participants in the Plan during the Plan Year. The Section 415 Suspense Account
shall not share in any earnings or losses of the Trust Fund.
(4) The Plan may not distribute "excess amounts" to Participants or
Former Participants.
Page 48
SECTION 17
SECTION 17. TOP HEAVY PROVISIONS
---------------------------------
(a) Top Heavy Plan Requirements. For any Top Heavy Plan Year, the Plan
---------------------------
shall provide the following:
(i) special minimum allocation requirements of Code section 416(c)
pursuant to Section 17(c) of the Plan; and
(ii) special Earnings requirements of Code section 416(d).
(b) Determination of Top Heavy Status.
---------------------------------
(1) This Plan shall be a Top Heavy Plan for any Plan Year commencing
after December 31, 1983, in which, as of the Determination Date, (i) the present
value of accrued benefits of Key Employees and (ii) 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 after December
31, 1984, if a Participant or former Participant has not received any
compensation from the Company (other than benefits under the Plan) at any time
during the five year period ending on the Determination Date, the Aggregate
Account and/or present value of accrued benefit for such Participation 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.
Page 49
SECTION 17 (b)(2)
(2) 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, (A)
the present value of accrued benefits of Key Employees and (B) 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.
(3) Aggregate Account: A Participant's Aggregate Account as of the
Determination Date is the sum of:
(A) his account balances as of the most recent valuation
occurring within a twelve (12) month period ending on the Determination Date;
(B) an adjustment for any contributions due as of the
Determination Date. Such adjustment shall be the amount of any contributions
actually made after the valuation date but on or before the Determination Date,
except for the first Plan Year when such adjustment shall also reflect the
amount of any contributions made after the Determination Date that are allocated
as of a date in that first Plan Year;
(C) 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 Aggregate Account balance 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.
Page 50
SECTION 17(b)(3)(D)
(D) any employee contributions, whether voluntary or mandatory.
However, amounts attributable to tax deductible qualified deductible employee
contributions shall not be considered to be a part of the Participant's
Aggregate Account balance.
(E) with respect to unrelated rollovers and plan-to-plan
transfers (ones which are both initiated by the Participant 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 rollover or plan-to-plan transfer 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 Aggregate Account
balance. However, rollovers or plan-to-plan transfers accepted prior to January
1, 1984 shall be considered as part of the Participant's Aggregate Account
balance.
(F) with respect to related rollovers and plan-to-plan transfers
(ones either not initiated by the Participant or made to a plan maintained by
the same employer), if this Plan provides the rollover or plan-to-plan transfer,
it shall not be counted as a distribution for purposes of this Section. If this
Plan is the plan accepting such rollover or plan-to-plan transfer, it shall
consider such rollover or plan-to-plan transfer as part of the Participant's
Aggregate Account balance, irrespective of the date on which such rollover or
plan-to-plan transfer is accepted.
(4) "Aggregation Group" means either a Required Aggregation Group or
a Permissive Aggregation Group as hereinafter determined.
Page 51
SECTION 17(b)(3)(A)
(A) Required Aggregation Group: In determining a Required
Aggregation Group hereunder, each plan of the Company in which a Key Employee is
a participant, and each other plan of the Company 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.
(B) Permissive Aggregation Group: The Company 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.
(C) Only those plans of the Company in which the Determination
Dates fall within the same calendar year shall be aggregated in order to
determine whether such plans are Top Heavy Plans.
(5) "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.
Page 52
SECTION 17(b)(3)(C)(6)
(6) Present Value of Accrued Benefit: In the case of a
defined benefit plan, a Participant's present value of accrued benefit shall be
as determined under the provisions of all the defined benefit plans of the
Company.
(7) "Top Heavy Group" means an Aggregation Group in which,
as of the Determination Date, the sum of:
(A) the present value of accrued benefits of Key Employees under
all defined benefit plans included in the group, and
(B) 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.
(8) "Top Heavy Plan Year" means that, for a particular Plan
Year commencing after December 31, 1983, the Plan is a Top Heavy Plan.
(9) Notwithstanding anything herein to the contrary, the
effective date otherwise provided for herein for the application of Code section
416 to this Plan (Plan Years beginning after December 31, 1983) shall be
extended in accordance with any act of Congress or regulatory authority.
Page 53
SECTION 17(c)
(c) Minimum Benefit Requirement for Top Heavy Plan.
----------------------------------------------
(1) Minimum Allocations Required for Top Heavy Plan Years:
Notwithstanding the foregoing, for any Top Heavy Plan Year, the sum of the
Company contributions and Forfeitures allocated to the accounts of each Non-Key
Employee shall be equal to at least three percent (3%) of such Non-Key
Employee's 416 Compensation. However, if (i) the sum of the Company
contributions and Forfeitures allocated to the accounts of each Key Employee for
such Top Heavy Plan Year is less than three percent (3%) of each Key Employee's
416 Compensation and (ii) this Plan is not required to be included in an
Aggregation Group to enable a defined benefit plan to meet the requirements of
Code section 401(a)(4) or 410, the sum of the Company contributions and
Forfeitures allocated to the accounts of each Non-Key Employee shall be equal to
the largest percentage allocated to the accounts of each Key Employee.
Except, however, no such minimum allocation shall be required in
this Plan for any Non-Key Employee who participates in another defined
contribution plan subject to Code Section 412 included with this Plan in a
Required Aggregation Group.
(2) For any Plan Year when (A) the Plan is a Top Heavy Plan but
not a Super Top Heavy Plan and (B) a Key Employee is a Participant in both this
Plan and a defined benefit plan included in a Required Aggregation Group which
is top heavy, the extra minimum allocation (required by Subsections 15(b)(10)(E)
and 15(b)(11) to provide higher limitations) shall be provided for each Non-Key
Employee who is a Participant only in this Plan by substituting four percent
(4%) for three percent (3%) in the paragraph above.
(3) For purposes of the minimum allocations set forth above, the
percentage allocated to the account of any Key Employee shall be equal to the
ratio of the sum of the Company contributions and Forfeitures allocated on
behalf of such Key Employee divided by the 416 Compensation for such Key
Employee.
Page 54
(4) For any Top Heavy Plan Year, the minimum allocations set
forth above shall be allocated to the accounts of all Non-Key Employees who are
Participants and who are employed by the Company on the last day of the Plan
Year, including Non-Key Employees who have (i) failed to complete a Year of
Service and (ii) declined to make mandatory contributions (if required) to the
Plan.
(5) In lieu of the above, if a Non-Key Employee participates in
this Plan and a defined benefit pension plan included in a Required Aggregation
Group which is top heavy, a minimum allocation of five percent (5%) of 416
Compensation shall be provided under this Plan.
However, for any Plan Year when (A) the Plan is a Top Heavy Plan
but not a Super Top Heavy Plan and (B) a Key Employee is a Participant in both
this Plan and a defined benefit plan included in a Required Aggregation Group
which is top heavy, seven and one-half percent (7 1/2%) shall be substituted for
five percent (5%), and the extra minimum allocation (required by Subsections
16(b)(10)(E) and 16(b)(11) to provide higher limitations) shall be provided in
this Plan.
(6) For the purposes of this Section, "416 Compensation" shall
mean W-2 wages for the calendar year ending with or within the Plan Year and
shall be limited to $200,000 in Top Heavy Plan Years.
Page 55
SECTION 18
SECTION 18. GENERAL PROVISIONS.
------------------------------
(a) Plan Mergers. The Plan shall not be merged or consolidated with any
------------
other plan, and no assets or liabilities of the Plan shall be transferred to any
other plan, unless each Participant would receive a benefit immediately after
such merger, consolidation or transfer (if the Plan then terminated) which is
equal to or greater than the benefit such Participant would have been entitled
to receive immediately before such merger, consolidation or transfer (if the
Plan had then terminated).
(b) No Assignment of Property Rights. The interest or property rights of
--------------------------------
any person in the Plan, in the Trust Fund or in any payment to be made under the
shall not be assignable nor be subject to alienation or option, either by
voluntary or involuntary assignment or by operation of law, including (without
limitation) bankruptcy, garnishment, attachment or other creditor's process, and
any act in violation of this Subsection 15(c) shall be void. This provision
shall not apply to a "qualified domestic relations order" defined in Code
section 414(p), and those other domestic relations orders permitted to be so
treated by UDLP under the provisions of the Retirement Equity Act of 1984. UDLP
shall establish a written procedure to determine the qualified status of
domestic relations orders and to administer distributions under such qualified
orders. Further, to the extent provided under a "qualified domestic relations
order", a former spouse of a Participant shall be treated as the spouse or
surviving spouse for all purposes under the Plan.
Page 56
SECTION 18(c)
(c) Beneficiary. The "Beneficiary" of a Participant shall be the person or
-----------
persons so designated by such Participant. Unless it is established to the
satisfaction of UDLP that a Participant has no spouse, the spouse cannot be
located, or such other circumstances exist as may be prescribed by Income Tax
Regulations promulgated by the Secretary of the Treasury, the designation of a
person other than the Participant's spouse as Beneficiary may be made only with
the written consent of the spouse, acknowledging the effect of the designation
and witnessed by a Plan representative or a notary public. Any designation
which lacks required spousal consent on the date of the Participant's death
shall be void, and the Participant shall be deemed to have designated his spouse
as Beneficiary. If no Beneficiary has been designated or if the designated
Beneficiary is not living when a Plan Benefit is to be distributed, the
Beneficiary shall be such Participant's spouse if then living, or if not, his
then living children in equal shares or, if there are no such children, her
estate. A Participant may revoke and change a designation of a Beneficiary at
any time. A designation of a Beneficiary, or any revocation and change thereof,
shall be effective only if it is made in writing in a form acceptable to UDLP
and is received by it prior to the Participant's death.
(d) Incapacity. If, in the opinion of UDLP, any person becomes unable to
----------
handle properly any property distributable under the Plan, FMC may make any
arrangement for distribution on her behalf that it determines will be beneficial
to her, including (without limitation) distribution to her guardian,
conservator, spouse or dependent.
(e) Employment Rights. Nothing in the plan shall be deemed to give any
-----------------
person a right to remain in the employ of the Affiliated Group or affect any
right of the Affiliated Group to terminate a person's employment with or without
cause.
Page 57
SECTION 18(f)
(f) Voting Rights. Each Participant (or, in the event of her death, her
-------------
Beneficiary) shall have the right to direct the Trustee as to the manner in
which shares of Stock allocated to her accounts as of the Valuation Date
coinciding with or immediately preceding the record date for an annual or
special stockholders' meeting of FMC or Harsco are to be voted on each matter
brought before such stockholders' meeting. Before each such meeting of
stockholders, FMC shall cause to be furnished to each Participant (or
Beneficiary) a copy of the proxy solicitation material, together with a form
requesting confidential directions on how such shares of Stock allocated to such
Participant's accounts shall be voted on each such matter. Upon timely receipt
of such directions the Trustee shall on each such matter vote as directed the
number of shares (including fractional shares) of Stock allocated to such
Participant's accounts. The instructions received by the Trustee from
Participants shall be held by the Trustee in confidence and shall not be
divulged or released to any person, including officers or employees of FMC or
Harsco or any member of the Affiliated Group. The Trustee shall vote all
unallocated shares, as well as allocated shares for which it has not received
direction, as directed by FMC, which may delegate to an independent fiduciary,
the authority to so direct the Trustee.
(g) Rights on Tender or Exchange Offer. Each Participant (or, in the event
----------------------------------
of her death, her Beneficiary) shall have the right, to the extent of the number
of shares of Stock (including fractional shares) allocated to her accounts as of
the Valuation Date coinciding with or immediately preceding a tender or exchange
offer with respect to such shares of Stock, to direct the Trustee in writing as
to the manner in which to respond to the tender or exchange offer. FMC shall
use its best efforts to timely distribute or cause to be distributed to each
Participant (or Beneficiary) such information as will be distributed to
stockholders of FMC or Harsco as the case may be in connection with any such
tender or exchange offer. Upon timely receipt of such instructions, the Trustee
shall respond as instructed with respect
Page 58
SECTION 18(g)
to such shares of Stock. The instructions received by the Trustee from
Participants shall be held by the Trustee in confidence and shall not be
divulged or released to any person including officers or employees of FMC or any
member of the Affiliated Group. If the Trustee shall not receive timely
instruction from a Participant (or Beneficiary) as to the manner in which to
respond to such a tender or exchange offer, the Trustee shall not tender or
exchange any shares of Stock with respect to which such Participant has the
right of direction. Unallocated shares of Stock shall be tendered or exchanged
by the Trustee in the same proportion as shares of Stock with respect to which
Participants (or Beneficiaries) have the right of direction are tendered or
exchanged. Any consideration received for stock tendered and sold shall be
placed in a separate account in the FMC Stock Fund or Harsco Stock Fund until
FMC instructs the Trustee as to its further disposition, and, pending receipt of
such instructions, the Trustee may temporarily invest any cash consideration in
accordance with the provisions of Subsection 13(e) regarding temporary
investments.
(h) Account Statements. At least annually, UDLP shall furnish for each
------------------
Participant an account statement as required by ERISA as of the Valuation Date
preceding the date of such statement.
(i) Choice of Law. The Plan and all rights thereunder shall be
-------------
interpreted and construed in accordance with ERISA and, to the extent that state
law is not pre-empted by ERISA, the law of the State of Illinois.
Page 59
SECTION 19
SECTION 19. DEFINITIONS.
------------------------
(a) "Active Participation" means a Participant has a currently effective
election of Employee-Elected Company Contributions and is eligible to receive
allocations of Company Contributions and Forfeitures.
(b) "Adjusted Regular Compensation" means the Participant's Regular
Compensation reduced by an amount equal to the Dollar Limit, but not more than
16% of his Earnings, as provided in Subsection 2(a).
(c) "Affiliate" means any corporation, other than a Foreign Subsidiary or
unincorporated trade or business, with respect to which at least 50 percent of
the total combined voting power of all classes of stock entitled to vote or not
less than 80 percent of the total value of shares of all classes of stock (or in
the case of an unincorporated trade or business or "controlling interest" as
defined in regulations under Section 414(c) of the Code) is owned by:
(i) UDLP;
(ii) One or more corporations or unincorporated trade or business
owned by UDLP as described in subdivision (i); or
(iii) UDLP and one or more corporations or unincorporated trades or
business owned by UDLP as described in subdivision (i).
(d) "Affiliated Group" means (i) UDLP and (ii) any corporation or
unincorporated trade or business (including an Affiliate) in which UDLP and/or
one or more Affiliates own either stock possessing at least 80 percent of the
total combined voting power of all classes of stock entitled to vote or at least
80 percent of the total value of all shares of all classes of stock (or in the
case of an unincorporated trade or business, or "controlling interest" as
defined in regulations under Section 414(c) of the Code).
Page 60
SECTION 19(f)
(e) "Aggregate Account" means, with respect to each Participant, the
value of all accounts maintained on behalf of a Participant, whether
attributable to Company or employee contributions, subject to the provisions of
Section 17(b).
(f) "Average Invested Capital" means the average of the beginning and
ending balances of stockholders' equity, short-term debt, and long term debt,
all as stated in the consolidated balance sheet in the annual report of UDLP,
and the receivable sale facility established in connection with the 1986
recapitalization.
(g) "Basic Contributions" means that portion of a Participant's
annualized Employee-Elected Company Contributions and Special Employee
Contributions not in excess of 5% of her Earnings.
(h) "Beneficiary" means the person or persons determined pursuant to
Subsection 18(c).
(i) "Code" means the Internal Revenue Code of 1986, as it may be amended
from time to time.
(j) "Company" means UDLP, and any predecessor companies of UDLP and any
Affiliates which UDLP has designated as participating companies with respect to
the Plan and which have accepted participation in the Plan. The designation of
any Affiliate as a participating company may be subject to such terms and
conditions as UDLP may determine.
(k) "Company Contributions" means contributions made by UDLP under
Subsection 4(a), including Company contributions made to the Harsco Corporation
Savings Plan and transferred to this Plan, but not including Employee-Elected
Company Contributions.
Page 61
SECTION 19(l)
(l) "Company Contributions Account" means an account maintained for each
Participant to which is allocated her share of Company Contributions and
Forfeitures and all earnings, appreciation or losses attributable thereto.
(m) "Distribution Date" means the date, determined pursuant to Subsection
9(c), as of which the distribution of a Plan Benefit is made.
(n) "Dollar Limit" means the maximum amount of Employee-Elected Company
Contributions excludable from the gross income of a Participant in a given year
as provided in Code Section 402(g) and as adjusted from time to time by the
Secretary of the Treasury pursuant to Code Section 415(d).
(o) "Earnings" means the Participant's total annual income for the
current Year determined during the Year by annualizing the current rate of pay
(not in excess of $150,000 for Years after 1993 as adjusted for cost of living
increases in accordance with Code Section 401(a)(17)(B)), including base salary;
overtime pay; administrative or discretionary bonuses earned; sales bonuses and
sales commissions earned in such Year and her Employee-Elected Company
Contributions. Earnings does not include expatriate premiums, awards, moving
expense allowances, or other special payments. Effective April 1, 1991,
"Earnings" (1) means the Participant's total annual income for the current Year,
which will be determined during the Year by annualizing the current rate of pay,
and (2) includes sales bonuses and sales commissions earned in such Year
determined without regard to such bonuses and/or commissions for preceding
Years.
(p) "Eligible Employee" means any individual employed by the Company,
except as hereinafter provided.
"Eligible Employee" does not include (i) any individual whose employment is
covered by a collective-bargaining agreement unless such agreement expressly
provides for
Page 62
SECTION 19(p)
participation in the Plan by such employee, (ii) leased employees within the
meaning of Code section 414(n)(2), and (iii) any employee who generally resides
outside the United States or whose principal duties generally are performed
outside the United States, as determined by UDLP, unless UDLP designates such
employee as an Eligible Employee.
Any individual who is a United States citizen and who is employed by
a Foreign Subsidiary in a position which would make such individual an Eligible
Employee if employed by UDLP shall be deemed to be employed by UDLP, provided
that no entity other than UDLP makes contributions under any funded plan of
deferred compensation with respect to the remuneration such individual receives
from such Foreign Subsidiary.
An individual's status as an Eligible Employee shall be determined by
UDLP. Subject to the review procedure described in Section 11, such
determination shall be conclusive and binding on all persons.
(q) "Employee-Elected Company Contributions" means amounts contributed to
the Trust as elected by Participants under Subsection 3(b).
(r) "Employee-Elected Company Contributions Account" means an account
maintained for each Participant and for each Eligible Employee who has
transferred to the Trust a "Qualified Total Distribution" under Subsection 3(g)
but is not otherwise a Participant to which is credited all of her Employee-
Elected Company Contributions, her Qualified Total Distributions, and any
earnings, appreciation, or losses attributable thereto.
(s) "Equity Fund" means an investment fund established and maintained by
the Trustee as a part of the Trust Fund. Any contributions to the Plan placed in
the Equity Fund, and all earnings and appreciation attributable thereto, shall
be invested and reinvested only in shares of mutual funds registered under the
Investment Company Act of 1940.
Page 63
SECTION 19(t)
(t) "ERISA" means the Employee Retirement Income Security Act of 1974, as
it may be amended from time to time.
(u) "Fixed Income Fund" means an investment fund established and
maintained by the Trustee as a part of the Trust Fund. Any contributions to the
Plan placed in the Fixed Income Fund, and all earnings and appreciation
attributable thereto, shall be invested and reinvested only in (A) guaranteed
income contracts and similar products, if any, guaranteeing repayment of
principal in full together with interest at a fixed or fixed minimum rate,
whether issued by an insurance company or other financial institution, (B)
securities issued or guaranteed by the United States of America or any agency or
instrumentality thereof, or (C) pending investment in the contracts or
securities described in (A) and (B), in short-term, interest-bearing debt
obligations as provided in Section 13(e). The Fixed Income Fund was formerly
called the "Guaranteed Income Fund."
(v) "UDLP" means UDLP Corporation, a Delaware corporation.
(w) "FMC Stock Fund" means an investment fund established and maintained
by the Trustee as part of the Trust Fund. Any contributions to the Plan placed
in the FMC Stock Fund, and all dividends and other earnings and appreciation
attributable thereto, shall other earnings and appreciation attributable thereto
shall be revested only in FMC Stock.
(x) "FMC Stock" means common stock of FMC.
(y) "Foreign Subsidiary" means a foreign corporation covered by an
agreement between the Company and the Internal Revenue Service extending Federal
Social Security benefits to such foreign corporation's employees who are United
States citizens, provided that either (i) not less than 20% of the voting stock
of such foreign corporation is owned by the Company or (ii) more than 50% of the
voting stock of such foreign corporation is owned by another foreign corporation
which is described in (i) above.
Page 64
SECTION 19(aa)
(aa) "Forfeiture" means the portion (if any) of a Participant's Company
Contributions Account which is forfeited pursuant to Section 8(b) upon
termination of employment.
(bb) "Harsco" means Harsco Corporation, a Delaware Corporation.
(cc) "Harsco Stock" means common stock of Harsco.
(dd) "Harsco Stock Fund" means an investment fund established and
maintained by the Trustee as part of the Trust Fund. Any contributions to the
Plan placed in the Harsco Stock Fund and all dividends and other earnings
attributable thereto, shall be invested only in Harsco Stock.
(ee) "Key Employee" means those employees defined in Code section 416(i)
and the Treasury regulations thereunder. Generally, they shall include any
employee or former employee of the Affiliated Group (and her Beneficiaries) who,
at any time during the Plan Year or any of the preceding four (4) Plan Years,
is:
(i) An officer of the Company (as that term is defined within the
meaning of the regulations under Code section 416) having annual 415
Compensation greater than 50 percent of the amount in effect under Code section
415(b)(1)(A) for any such Plan Year.
(ii) One of the ten employees of the Affiliated Group owning (or
considered as owning within the meaning of Code section 318) the largest
interests in all employers required to be aggregated under Code sections 414(b),
(c), and (m). However, an employee will not be considered a top ten owner for a
Plan Year if the employee earns not more than the amount in effect under Code
section 415(c)(1)(A).
(iii) A "Five Percent Owner" of the Company. "Five Percent Owner"
means any person who owns (or is considered as owning within the meaning of Code
section 318) more than five percent (5%) of the outstanding stock of the Company
or stock possessing more than five percent (5%) of the total combined voting
power of all stock of the Company
Page 65
SECTION 19(ee)(iii)
or, in the case of an unincorporated business, any person who owns more than
five percent (5%) of the capital or profits interest in the Company. In
determining percentage ownership hereunder, employers that would otherwise be
aggregated under Code sections 414(b), (c), and (m) shall be treated as separate
employers.
(iv) A "One Percent Owner" of the Company having an annual 415
Compensation from the Affiliated Group of more than $150,000. "One Percent
Owner" means any person who owns or is considered as owning within the meaning
of (Code section 318) more than one percent (1%) of the outstanding stock of the
Company or stock possessing more than one percent (1%) of the total combined
voting power of all stock of the Company or, in the case of an unincorporated
business, any person who owns more than one percent (1%) of the capital or
profits interest in the Company. In determining percentage ownership hereunder,
employers that would otherwise be aggregated under Code sections 414(b), (c),
and (m) shall be treated as separate employers. However, in determining whether
an individual has 415 Compensation of more than $150,000, 415 Compensation from
each employer required to be aggregated under Code sections 414(b), (c) and (m)
shall be taken into account.
(ff) "Non-Key Employee" means any employee or former employee of the
Affiliated Group (and her beneficiaries) who is not a Key Employee.
(gg) "Participant" means an Eligible Employee who has elected to
participate in the Plan as provided in Subsection 2(a) or who has transferred to
the Trust a "Qualified Total Distribution" under Subsection 3(g).
(hh) "Plan" means the UDLP Employees' Thrift and Stock Purchase Plan, as
it may be amended from time to time.
Page 66
SECTION 19(ii)
(ii) "Plan Benefit" means the aggregate of any distributions from a
Participant's Special Employee Contributions Account, Employee-Elected Company
Contributions Account, and Company Contributions Account, to which she becomes
entitled under Section 8(a) upon termination of employment or upon becoming
permanently and totally disabled.
(jj) "Plan Year" means a period of 12 consecutive months beginning on
April 1.
(kk) "Profits" means the sum of consolidated net income of FMC and the
after-tax cost of interest on all short-term and long-term debt of FMC all as
stated in its annual report, plus the costs associated with the receivable sale
facility established in connection with the 1986 recapitalization. To the
extent authorized by FMC there shall be excluded from "Profits" all losses,
income or gain resulting from discontinued operations, disposal of discontinued
operations, extraordinary items and changes in accounting practices.
(ll) "Regular Compensation" means the Participant's total annual income
for the Year including base salary, overtime pay, administrative, discretionary
and sales bonuses, and sales commissions earned in such Year. Regular
Compensation does not include expatriate premiums, awards, moving expense
allowances, or other special payments.
(mm) "Special Employee Contributions" means employee contributions made
under Subsection 3(g).
(nn) "Special Employee Contributions Account" means an account maintained
for each Participant to which is credited all of her Special Employee
Contributions and any earnings, appreciation, or losses attributable thereto.
(oo) "Stock" means the common stock of FMC and Harsco.
(pp) "Stock Funds" means the FMC Stock Fund and the Harsco Stock Fund.
(qq) "Super Top Heavy Plan" means a plan described in Section 17(b)(2).
Page 67
SECTION 19(rr)
(rr) "Top Heavy Plan" means a plan described in Section 17(b)(1).
(ss) "Top Heavy Plan Year" means that, for a particular Plan Year
commencing after December 31, 1983, the Plan is a Top Heavy Plan.
(tt) "Trust" means the trust established by the Trust Agreement. "Trust
Agreement" means the trust agreement or agreements, as amended from time to
time, entered into by UDLP and the Trustee pursuant to Subsection 12(b).
"Trustee" means the trustee or trustees at any time appointed by UDLP pursuant
to Subsection 12(b). "Trust Fund" means the trust fund established and
maintained by the Trustee to hold all assets of the Plan pursuant to the Trust
Agreement.
(uu) "UDLP" means United Defense Limited Partnership
(vv) "Valuation Date" means the last business day of each calendar month.
(ww) "Year" means a calendar year.
(xx) "Year of Service" means calendar months of employment by the
Affiliated Group (including any interruption of employment up to 12 months)
divided by 12. A partial month shall be counted as a whole month, and any
fractional Year of Service shall be ignored. "Year of Service" shall not include
(i) any period in excess of 12 months for which the individual does not receive
Earnings, including (without limitation) any leave of absence without pay or
(ii) any other interruption of employment in excess of 12 months.
"Year of Service" shall be determined taking into account any period
during which the individual was a leased employee within the meaning of Code
section 414(n)(2), unless during such period leased employees constitute less
than twenty percent (20%) of the Company's nonhighly compensated work force
within the meaning of Code section 414(n)(1)(C)(ii) and the individual is
covered by a plan described in Code section 414(n)(5).
Page 68
SECTION 20
SECTION 20. EXECUTION.
-----------------------
To record the adoption of the Plan to read as set forth herein, United
Defense Limited Partnership has caused its authorized officer to execute the
same the ______day of _____________________ 1995, but effective January 1, 1995.
UNITED DEFENSE LIMITED PARTNERSHIP
By: FMC CORPORATION its General Partner
By: /s/ Patrick J. Head
--------------------------------------
Chairman, Employee Welfare Benefits
Plan Committe
Page 69
EXHIBIT A
---------
Section 401(k)(3), Internal
---------------------------
Revenue Code of 1986
--------------------
(3) APPLICATION OF PARTICIPATION AND DISCRIMINATION STANDARDS. -
---------------------------------------------------------
(A) A cash or deferred arrangement shall not be treated as a qualified
cash or deferred arrangement unless -
(i) those employees eligible to benefit under the arrangement satisfy
the provisions of section 410(b)(1), and
(ii) the actual deferral percentage for eligible highly compensated
employees (as defined in paragraph (5) for such year bears a relationship to the
actual deferral percentage for all other eligible employees for such plan year
which meets either of the following tests:
(I) The actual deferral percentage for the group of eligible
highly compensated employees is not more than the actual deferral percentage of
all other eligible employees multiplied by 1.25.
(II) The excess of the actual deferral percentage for the group
of eligible highly compensated employees over that of all other eligible
employees is not more than 2 percentage points, and the actual deferral
percentage for the group of eligible highly compensated employees is not more
than the actual deferral percentage of all other eligible employees multiplied
by 2.
If 2 or more plans which include cash or deferred
arrangements are considered as 1 plan for purposes of section 401(a)(4) or
410(b), the cash or deferred arrangements included in such plans shall be
treated as 1 arrangement for purposes of this subparagraph.
Page 70
If any highly compensated employee is a participant under 2
or more cash or deferred arrangements of the employer, for purposes of
determining the deferral percentage with respect to such employee, all such cash
or deferred arrangements shall be treated as 1 cash or deferred arrangement.
(B) For purposes of subparagraph (A), the actual deferral percentage for a
specified group of employees for a plan year shall be the average of the ratios
(calculated separately for each employee in such group) of -
(i) the amount of employer contributions actually paid over to the
trust on behalf of each such employee for such plan year, to
(ii) the employee's compensation for such plan year.
(C) A cash or deferred arrangement shall be treated as meeting the
requirements of subsection (a)(4) with respect to contributions if the
requirements of subparagraph (A)(ii) are met.
(D) For purposes of subparagraph (B), the employer contributions on behalf
of any employee -
(i) shall include any employer contributions made pursuant to the
employee's election under paragraph (2), and
(ii) under such rules as the Secretary may prescribe, may, at the
election of employer, include -
(I) matching contributions (as defined in section 401(m)(4)(A))
which meets the requirements of paragraph (2)(B) and (C), and
(II) qualified nonelective contributions (within the meaning of
section 401(m)(4)(C)).
Page 71
EXHIBIT B
---------
Section 401(m), Internal
------------------------
Revenue Code of 1986
--------------------
(m) NONDISCRIMINATION TEST FOR MATCHING CONTRIBUTIONS AND EMPLOYEE
--------------------------------------------------------------
CONTRIBUTIONS. -
- -------------
(1) IN GENERAL - A defined contribution plan shall be treated as meeting
----------
the requirements of subsection (a)(4) with respect to the amount of any matching
contribution or employee contribution for any plan year only if the contribution
percentage requirement of paragraph (2) of this subsection is met for such plan
year.
(2) REQUIREMENTS.-
------------
(A) CONTRIBUTION PERCENTAGE REQUIREMENT. - A plan meets the
-----------------------------------
contribution percentage requirement of this paragraph for any plan year only if
the contribution percentage for eligible highly compensated employees does not
exceed the greater of -
(i) 125 percent of such percentage for all other eligible
employees, or
(ii) the lesser of 200 percent of such percentage for all other
eligible employees, or such percentage for all other eligible employees plus 2
percentage points.
(B) MULTIPLE PLANS TREATED AS A SINGLE PLAN. - If two or more plans
---------------------------------------
of an employer to which matching contributions, employee contributions, or
elective deferrals are made are treated as one plan for purposes of section
410(b), such plans shall be treated as one plan for purposes of this subsection.
If a highly compensated employee participates in two or more plans of an
employer to which contributions to which this subsection applies are made, all
such contributions shall be aggregated for purposes of this subsection.
Page 72
(3) CONTRIBUTION PERCENTAGE. - For purposes of paragraph (2), the
-----------------------
contribution percentage for a specified group of employees for a plan year shall
be the average for the ratios (calculated separately for each employee in such
group) of -
(A) the sum of the matching contributions and employee contributions
paid under the plan on behalf of each such employee for such plan year, to,
(B) the employee's compensation (within the meaning of section
414(s)) for such plan year.
Under regulations, an employer may elect to take into account (in computing the
contribution percentage) elective deferrals and qualified nonelective
contributions under the plan or any other plan of the employer. If matching
contributions are taken into account for purposes of subsection (k)(3)(A)(ii)
for any plan year, such contributions shall not be taken into account under
subparagraph (A) for such year.
(4) DEFINITIONS. - For purposes of this subsection-
-----------
(A) MATCHING CONTRIBUTION - The term "matching contribution" means -
---------------------
(i) any employer contribution made to a defined contribution plan on
behalf of an employee on account of an employee contribution made by such
employee, and
(ii) any employer contribution made to a defined contribution
plan on behalf of an employee on account of an employee's elective deferral.
(B) ELECTIVE DEFERRAL - The term "elective deferral" means any
----------------
employer contribution described in section 402(g)(3).
(C) QUALIFIED NONELECTIVE CONTRIBUTIONS - The term "qualified
-----------------------------------
nonelective contribution" means any employer contribution (other than a matching
contribution) with respect to which -
Page 73
(i) the employee may not elect to have the contribution paid to
the employee in cash instead of being contributed to the plan, and
(ii) the requirements of subparagraphs (B) and (C) of subsection
(k)(2) are met.
(5) EMPLOYEES TAKEN INTO CONSIDERATION. -
----------------------------------
(A) IN GENERAL - Any employee who is eligible to make an employee
---------
contribution (or, if the employer takes elective contributions into account,
elective contributions) or to receive a matching contribution under the plan
being tested under paragraph (1) shall be considered an eligible employee for
purposes of this subsection.
(B) CERTAIN NONPARTICIPANTS - If an employee contribution is required
-----------------------
as a condition of participation in the plan, any employee who would be a
participant in the plan if such employee made such a contribution shall be
treated as an eligible employee on behalf of whom no employer contributions are
made.
(6) PLAN NOT DISQUALIFIED IF EXCESS AGGREGATE CONTRIBUTIONS DISTRIBUTED
-------------------------------------------------------------------
BEFORE END OF FOLLOWING PLAN YEAR -
- ---------------------------------
(A) IN GENERAL - A plan shall not be treated as failing to meet the
----------
requirements of paragraph (1) for any plan year if, before the close of the
following plan year, the amount of the excess aggregate contributions for such
plan year (and any income allocable to such contributions) is distributed (or,
if forfeitable, is forfeited). Such contributions (and such income) may be
distributed without regard to any other provision of law.
Page 74
(B) EXCESS AGGREGATE CONTRIBUTIONS- For purposes of subparagraph (A)
------------------------------
the term "excess aggregate contributions" means, with respect to any plan year,
the excess of -
(i) the aggregate amount of the matching contributions and
employee contributions (and any qualified nonelective contribution or elective
contribution taken into account in computing the contribution percentage)
actually made on behalf of highly compensated employees for such plan year, over
(ii) the maximum amount of such contributions permitted under the
limitations of paragraph (2)(A) (determined by reducing contributions made on
behalf of highly compensated employees in order of their contribution
percentages beginning with the highest of such percentages).
(C) METHOD OF DISTRIBUTING EXCESS AGGREGATE CONTRIBUTIONS - Any
-----------------------------------------------------
distribution of the excess aggregate contributions for any plan year shall be
made to highly compensated employees on the basis of the respective portions of
such amounts attributable to each of such employees. Forfeitures of excess
aggregate contributions may not be allocated to participants whose contributions
are reduced under this paragraph.
(D) COORDINATION WITH SUBSECTION (k) AND 402(g) - The determination
-------------------------------------------
of the amount of excess aggregate contributions with respect to a plan shall be
made after -
(i) first determining the excess deferrals (within the meaning
of section 402(g), and
(ii) then determining the excess contributions under subsection
(k).
Page 75
(7) TREATMENT OF DISTRIBUTIONS. -
--------------------------
(A) ADDITIONAL TAX OF SECTION 72(t) NOT APPLICABLE - No tax shall be
----------------------------------------------
imposed under section 72(t) on any amount required to be distributed under
paragraph (6).
(B) EXCLUSION OF EMPLOYEE CONTRIBUTIONS - Any distribution
-----------------------------------
attributable to employee contributions shall not be included in gross income
except to the extent attributable to income on such contributions.
(8) HIGHLY COMPENSATED EMPLOYEE - For purposes of this subsection, the term
---------------------------
"highly compensated employee" has the meaning given to such term by section
414(q).
(9) REGULATIONS - The Secretary shall prescribe such regulations as may be
-----------
necessary to carry out the purposes of this subsection and subsection (k)
including -
(A) such regulations as may be necessary to prevent the multiple use
of the alternative limitation with respect to any highly compensated employee,
and
(B) regulations permitting appropriate aggregation of plans and
contributions. For purposes of the preceding sentence, the term "alternative
limitation" means the limitation of section 401(k)(3)(A)(ii)(II) and the
limitation of paragraph (2)(A)(ii) of this subsection.
Page 76