Exhibit (99f)
COOPER TIRE & RUBBER COMPANY
PRE-TAX SAVINGS PLAN - (BOWLING GREEN-SEAL)
AS AMENDED AND RESTATED EFFECTIVE AS OF JANUARY 1, 2001
OR AS OTHERWISE PROVIDED IN PLAN
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS............................................................................ 2
ARTICLE II ELIGIBILITY AND PARTICIPATION.......................................................... 11
ARTICLE III PARTICIPANTS' CONTRIBUTIONS............................................................ 13
ARTICLE IV COMPANY CONTRIBUTIONS.................................................................. 16
ARTICLE V INVESTMENT OF CONTRIBUTIONS............................................................ 20
ARTICLE VI VESTING OF CONTRIBUTIONS............................................................... 23
ARTICLE VII SUSPENSION OF PARTICIPATION............................................................ 24
ARTICLE VIII APPLICATION OF COMPANY CONTRIBUTIONS FORFEITED......................................... 25
ARTICLE IX WITHDRAWAL OF CONTRIBUTIONS............................................................ 26
ARTICLE X DESIGNATION OF BENEFICIARY............................................................. 28
ARTICLE XI DISTRIBUTION OF CONTRIBUTIONS.......................................................... 29
ARTICLE XII MAXIMUM CONTRIBUTION LIMITATION........................................................ 36
ARTICLE XIII RESERVED............................................................................... 41
ARTICLE XIV ADMINISTRATION OF THE PLAN............................................................. 42
ARTICLE XV SECURITIES TRANSACTIONS BY TRUSTEE..................................................... 52
ARTICLE XVI ASSIGNABILITY.......................................................................... 54
ARTICLE XVII AMENDMENT, MODIFICATION, SUSPENSION OR TERMINATION OF THE PLAN......................... 55
ARTICLE XVIII ESOP FEATURE........................................................................... 56
-i-
AGREEMENT
THIS AGREEMENT is made and entered into this 23rd day of July, 2001, by
and between Cooper Tire & Rubber Company hereinafter referred to as the
"Company" for its plant located in Bowling Green, Ohio and the United Steel
Workers of America, and Local Union No. 1042 thereof executing this Agreement;
the International Union and the Local Union collectively being hereinafter
referred to as the "Union".
Effective January 1, 2002, an ESOP will be established under the Plan
described in this Agreement. The ESOP feature is described in Article XVIII of
the Plan and in other relevant Plan sections. The provisions of the Plan
relating to the ESOP feature shall not be effective until January 1, 2002.
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ARTICLE I
DEFINITIONS
For the purposes of this Plan, the following words and phrases shall
have the following meanings unless a different meaning is clearly required by
the context:
(1) "Account" of a Participant or "Participant's Account" - the then total
current market value of the account in the Participant's name as
determined by the Trustee representing the entire interest of a
Participant in the Plan. Effective January 1, 2002, each account shall
consist of the Non-ESOP Account and ESOP Account. Prior to January 1,
2002, each account shall consist of a Pre-Tax Savings Plan Contribution
subaccount which will reflect the amount of Pre-Tax Savings Plan
Contributions attributable to a Participant and allocated earnings
attributable thereto, a Transfer Contributions subaccount which will
reflect the amount of Transfer Contributions attributable to a
Participant and allocated earnings attributable thereto and a Company
Contribution subaccount which will reflect the amount of Company
Contributions made pursuant to Article IV herein and allocated earnings
attributable thereto.
(2) "Active Participation" - the making of Participant contributions to the
Plan and the right to share in the allocation of Company Contributions
and ESOP Contributions, if any.
(3) "Actual Deferral Percentage" - for each Plan Year, the ratios
(expressed as a percentage and calculated separately for each Eligible
Employee in a specified group) of
a) the total amount of Company Wage Reduction
Contributions to
b) the Eligible Employee's aggregated
Compensation for such Plan Year.
Effective until January 1, 1997, for purposes of determining the
Actual Deferral Percentage for any Eligible Employee who is a Highly
Compensated Employee for the Plan Year, any Compensation paid to a
Family Member or any contribution made by the Company on such Family
Member's behalf under Section 1 of Article III shall be treated as
paid to or contributed on behalf of the Highly Compensated Employee.
Such Family Member shall be disregarded in determining the Actual
Deferral Percentage for Non-Highly Compensated Employees.
In addition, the Actual Deferral Percentage for any Highly
Compensated Employee for the Plan Year and who is a participant under
two or more plans described in Section 401(k) of the Code which are
maintained by the Company, shall be the sum of the Actual Deferral
Percentages under each of such plans.
(4) "Adjusted Employment Date" - the date arrived at when the Employee's
prior Continuous Credited Service is subtracted, according to Section 2
of Article II, from the date on which the Employee first renders
service entitling him/her to credit for an Hour of Service subsequent
to a prior period of Continuous Credited Service.
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(5) "Affiliated Group" - means the Company and any and all other
corporations, trades and/or businesses, the employees of which together
with Employees of the Company are required, by the first sentence of
Subsection (b) or Subsection (c) of section 414 of the Code to be
treated as if they were employed by a single employer. Each corporation
or unincorporated trade or business that is or was a member of the
Affiliated Group shall be referred to herein as an "Affiliated Group
Member" or an "Affiliated Company" but only during such period as it is
or was such a member.
(6) "Code" - the Internal Revenue Code of 1986, as amended to date, and as
it may hereafter be amended, or any successor statute of similar
purpose.
(7) "Committee" - the Defined Contribution Plan Committee established
herein.
(8) "Common Stock" - common stock of Cooper Tire & Rubber Company, which is
intended to be 'employer securities' within the meaning of Section
409(l) of the Code, and 'qualifying employer securities' within the
meaning of Section 407(d)(5) of ERISA. The Plan shall be permitted to
acquire and hold Common Stock, and shall be an eligible individual
account plan, as that term is defined in Section 407(d)(3)(A) of ERISA.
(9) "Company" - Cooper Tire & Rubber Company and any of its subsidiary
corporations which adopt this Plan.
(10) "Company Contributions" - contributions made by the Company pursuant to
Article IV of the Plan, other than Company Wage Reduction
Contributions.
(11) "Company Wage Reduction Contributions" - amounts transferred to the
Plan by the Company pursuant to wage reduction arrangements between the
Company and Participants, also sometimes referred to herein as Pre-tax
Savings Plan Contributions.
(12) "Compensation" - includes all payments of wages, bonus, Company Wage
Reduction Contributions to this Plan and any taxable payments paid to
the Participant in a calendar year, except that there shall be excluded
from Compensation: supplemental unemployment benefits, supplemental
worker's compensation, accident and sickness benefits, and other
amounts which either are excludable or deductible from income in whole
or in part for federal income tax purposes or which represent payments
pursuant to a program of benefits or deferred compensation (other than
Company Wage Reduction Contributions), whether or not qualified under
the Code.
Notwithstanding the above, the maximum amount of compensation taken
into account each year for all computations shall not exceed the
amount prescribed pursuant to Section 401(a)(17) of the Code, as
amended, or such amount as the Secretary of the Treasury shall
prescribe from time to time. Effective until January 1, 1997, in
determining the compensation of a Participant for purposes of the
limitation, the rules of section 414(q)(6) of the Code shall apply,
except in applying such rules, the term family shall include only the
spouse of the Participant and any lineal descendants of the
Participant who have not attained age 19 before the close of the
year. If, as a result of the application of the rules described in
the preceding sentence the limitation of Section 401(a)(17) of the
Code is exceeded, then the limitation shall be prorated among the
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affected individual's Compensation as determined under this section
prior to the application of this limitation.
In addition to other applicable limitations set forth in the plan,
and notwithstanding any other provision of the plan to the contrary,
for plan years beginning on or after January 1, 1994, the annual
compensation of each employee taken into account under the plan shall
not exceed the Omnibus Budget Reconciliation Act of 1993 (OBRA '93)
annual compensation limit. The OBRA '93 annual compensation limit is
$150,000, as adjusted by the Commissioner for increases in the cost
of living in accordance with section 401(a)(17)(B) of the Internal
Revenue Code. The cost-of-living adjustment in effect for a calendar
year applies to any period, not exceeding 12 months, over which
compensation is determined (determination period) beginning in such
calendar year. If a determination period consists of fewer than 12
months, the OBRA '93 annual compensation limit will be multiplied by
a fraction, the numerator of which is the number of months in the
determination period, and the denominator of which is 12.
For plan years beginning on or after January 1, 1994, any reference
in this plan to the limitation under section 401(a)(17) of the Code
shall mean the OBRA `93 annual compensation limit set forth in this
provision.
If compensation for any prior determination period is taken into
account in determining an employee's benefits accruing in the current
plan year, the compensation for that prior determination period is
subject to the OBRA '93 annual compensation limit in effect for that
prior determination period. For this purpose, for determination
periods beginning before the first day of the first plan year
beginning on or after January 1, 1994, the OBRA '93 annual
compensation limit is $150,000.
(13) "Continuous Credited Service" - the number of years aggregated under
the provisions of Article II, Section 2, except that Continuous
Credited Service prior to January 1, 1976, shall be calculated from the
most recent Employment Date.
(14) "Current Earnings" - net income before federal income taxes of the
Company for its current fiscal year and before deducting any Company
Contributions or ESOP Contributions to this Plan for such fiscal year
determined on the basis of generally accepted accounting principles.
(15) "Designated Beneficiary" - the beneficiary chosen by the Participant,
in accordance with the provisions of Article VIII herein, to receive,
upon the Participant's death, any benefit payable under this Plan by
reason of the Participant's death.
(16) "Eligible Employee" - any Employee who has satisfied the provisions of
Section 1 of Article II.
(17) "Employee" - any employee of the Bowling Green-Seal plant of the
Company, whose terms and conditions of employment are determined
through collective bargaining with the Union. To the extent required by
Section 414(n) of the Code, the term "Employee" includes any person who
is a "leased employee" of the Company or any other Controlled Group
Member. For purposes of this Subsection, a "leased employee" means any
person
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who, pursuant to an agreement between the Company or a Controlled Group
Member and any other person ("leasing organization"), has performed
services for the Company or Controlled Group Member on a substantially
full-time basis for a period of at least one year, and, effective
January 1, 1997, such services are performed under the primary
direction or control of the Company or Controlled Group Member.
Contributions or benefits provided to a leased employee by the leasing
organization that are attributable to services performed for the
Company or a Controlled Group Member will be treated as provided by the
Company or Controlled Group Member. A leased employee will not be
considered an Employee of the Company or a Controlled Group Member,
however, if (1) leased employees do not constitute more than 20% of the
Company's or Controlled Group Member's non-highly compensated work
force (within the meaning of Section 414(n)(5)(C)(ii) of the Code and
(2) such leased employee is covered by a money purchase pension plan
maintained by the leasing organization that provides (i) a
non-integrated employer contribution rate of at least 10% of
compensation, (ii) immediate participation and (iii) full and immediate
vesting. All personal and relative pronouns, singular or plural, and
words "person", "Employee", and "Employees" shall refer to both male
and female Employees generally.
(18) "Employment Date" - the date on which the Employee first completes an
Hour of Service in the employ of the Company, whether or not that
service is performed as an Employee.
(19) "ESOP Account" - shall include all amounts in the Participant's Account
that are transferred to the ESOP Account pursuant to Section 3 and
Section 5 of Article V. The ESOP Account shall be established under the
ESOP Feature of the Plan. The ESOP Account shall consist of a Pre-Tax
Savings Plan Contributions subaccount which will reflect the amount of
Pre-Tax Savings Plan Contributions in the ESOP Account attributable to
a Participant and allocated earnings attributable thereto, a Transfer
Contributions subaccount which will reflect the amount of Transfer
Contributions in the ESOP Account attributable to a Participant and
allocated earnings attributable thereto, a Company Contributions
subaccount which will reflect the amount of Company Contributions in
the ESOP Account made pursuant to Article IV herein and allocated
earnings attributable thereto, and an ESOP Contributions subaccount
which will reflect the amount of ESOP Contributions in the ESOP Account
made pursuant to Article XVIII herein and allocated earnings
attributable thereto.
(20) "ESOP Contributions" - are the discretionary contributions made by the
Company pursuant to Section 3 of Article XVIII.
(21) "ESOP Feature" - is the portion of the Plan described in Article XVIII
and shall be effective January 1, 2002. The ESOP Feature consists of
the ESOP Account.
(22) "Family Member" - effective until January 1, 1997, with respect to any
Employee, such Employee's spouse and lineal ascendants and descendants
and the spouses of such lineal ascendants and descendants.
(23) "Highly Compensated Employee" - The term Highly Compensated Employee
includes highly compensated active Employees and highly compensated
former Employees.
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For a particular Plan Year, effective January 1, 1997, a highly
compensated active Employee means any Employee who: (i) was a
5-percent owner at any time during the current or the preceding Plan
Year or (ii) for the preceding Plan Year received compensation from
the Company in excess of the amount in effect for such Plan Year
under Section 414(q)(1)(B) of the Code and was in the top-paid group
of Employees for such preceding Plan Year.
For the purposes of this Subsection, (i) the term "compensation"
shall mean (A) for periods prior to January 1, 1998, the sum of an
Employee's compensation under Section 415(c)(3) of the Code and the
Employee's Pre-Tax Savings Plan Contributions (subject to the
limitation of Section 401(a)(17) of the Code), and (B) for periods
commencing on and after January 1, 1998, an Employee's compensation
under Section 415(c)(3) of the Code (subject to the limitation of
Section 401(a)(17) of the Code), and (ii) the term "top-paid group"
shall mean that group of Employees of the Company consisting of the
top 20 percent (20%) of such Employees when ranked on the basis of
compensation paid by the Company during the Plan Year.
A highly compensated former Employee includes any Employee who
separated from service (or was deemed to have separated) prior to the
determination year, performs no service for the Company during the
determination year, and was a highly compensated active Employee for
either the separation year or any determination year ending on or
after the Employee's 55th birthday.
This paragraph shall apply until January 1, 1997. If any Employee is,
during a determination year or look-back year, a family member of
either a 5 percent owner who is an active or former Employee or a
Highly Compensated Employee who is one of the 10 most Highly
Compensated Employees ranked on the basis of Compensation paid by the
Company during such year, then the family member and the 5 percent
owner or top-ten Highly Compensated Employee shall be aggregated. In
such case, the family member and 5 percent owner or top-ten Highly
Compensated Employee shall be treated as a single Employee receiving
compensation and Plan contribution or benefits equal to the sum of
such Compensation and contributions or benefits of the family member
and 5 percent owner or top-ten Highly Compensated Employee. For
purposes of this section, family member includes the spouse, lineal
ascendants and descendants of the Employee or former Employee and the
spouses of such lineal ascendants and descendants.
The determination of who is a Highly Compensated Employee, including
the determination of the number and identity of Employees in the
top-paid group, and the compensation that is considered, will be made
in accordance with section 414(q) of the Code and the regulations
thereunder.
(24) "Hour of Service" - each hour for which an employee is paid, or
entitled to payment, by the Company for the performance of duties or on
account of a period of time during which no duties are performed due to
vacation, holiday, jury duty, short-term military duty or funeral
absence. Each hour for which an employee is not paid, or not entitled
to payment, on account of a period of time during which the employee
continues to accrue
6
Continuous Credited Service while under an approved leave of absence
for illness, incapacity or disability, long-term military duty or
personal reasons.
Each hour for which an employee is paid back pay, regardless of
mitigation of damages, except for hours previously credited for the
same period, or severance pay. Hours of Service shall not be credited
due to payments received by an employee from a plan maintained for
the sole purpose of complying with applicable worker's or
unemployment compensation laws, complying with disability insurance
laws, or reimbursement of medical or medically related expenses.
Such hours shall be credited as specified in Section 201 of the
Employee Retirement Income Security Act of 1974, as amended, and as
specified at Title 29, Code of Federal Regulations, 2530.200b.
Hours of Service performed at premium rates (such as holiday pay
overtime or shift differential) shall be credited as single Hours of
Service, regardless of the rate of compensation in effect for such
service. If an Employee is absent from work for any period which
commences on or after the Effective Date:
a) by reason of the pregnancy of the Employee,
b) by reason of the birth of a child of the
Employee,
c) by reason of the placement of a child with
the Employee in connection with the adoption of such
child by the Employee, or
d) for purposes of caring for any such child
for a period beginning immediately following such
birth or placement,
and the absence is permitted under the Company-Union basic labor
agreement, the Employee shall not, solely by reason of such absence,
be considered to have incurred a Severance Date for purposes of
participation and for determining his/her vested interest until the
expiration of the consecutive twenty-four (24) month period
commencing on the first day of the absence.
If an Employee is absent from work for any period for any reasons
referred to in subparagraphs (a), (b), (c) and (d) of this
subsection, and such period includes the last day of the Plan Year,
the Employee shall be deemed to be employed on such date for purposes
of Section 3 of Article II.
(25) "Investment Option" - one of those forms of investment which are
available to a Participant to invest Company Wage Reduction
Contributions, vested Company Contributions and related earnings under
the Plan.
(26) "Leave of Absence" - leave of absence granted by the Company due to
illness or injury, required U.S. Military Service, or other special
leave of absence set forth in the Company-Union basic labor agreement,
under which all Participants in similar circumstances shall be treated
alike.
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(27) "Non-ESOP Account" - shall include all Pre-Tax Savings Plan
Contributions, Company Contributions, and Transfer Contributions made
to the Plan pursuant to Articles III and IV of the Plan; except that
the Non-ESOP Account shall not include any portion of such
contributions transferred to the Participant's ESOP Account pursuant to
Section 3 and Section 5 of Article V. The Non-ESOP Account shall be
established under the Non-ESOP Feature of the Plan. The Non-ESOP
Account shall consist of a Pre-Tax Savings Plan Contributions
subaccount which will reflect the amount of Pre-Tax Savings Plan
Contributions in the Non-ESOP Account attributable to a Participant and
allocated earnings attributable thereto, a Transfer Contributions
subaccount which will reflect the amount of Transfer Contributions in
the Non-ESOP Account attributable to a Participant and allocated
earnings attributable thereto, and a Company Contributions subaccount
which will reflect the amount of Company Contributions in the Non-ESOP
Account made pursuant to Article IV herein and allocated earnings
attributable thereto.
(28) "Non-ESOP Feature" - is the portion of the Plan, on and after January
1, 2002, (a) which is not included within the ESOP Feature, (b) which
is intended to qualify as a profit sharing plan under Code Section
401(a), and (c) which includes a qualified cash or deferred arrangement
within the meaning of Code Section 401(k). The Non-ESOP Feature
consists of the Non-ESOP Account.
(29) "Non-Highly Compensated Employee - any Eligible Employee who is neither
a Highly Compensated Employee nor, effective until January 1, 1997, a
Family Member of a Highly Compensated Employee.
(30) "Normal Retirement Date" - the later of the day the Participant attains
age sixty-five (65) or the completion of five (5) years of
participation in the Company's Bowling Green-Seal Hourly Employees'
Retirement Plan.
(31) "One-Year Break in Service" - a Plan Year during which a Participant
has five hundred (500) or fewer Hours of Service. Temporary excused
absences, including military leave, shall not constitute a One-Year
Break in Service. Further, solely for the purpose of determining
whether a Participant has incurred a One- Year Break in Service, Hours
of Service shall be recognized for "maternity and paternity leaves of
absence." A "maternity or paternity leave of absence" shall mean, for
Plan Years beginning after December 31, 1984, an absence from work for
any period by reason of the Employee's pregnancy, birth of the
Employee's child, placement of a child with the Employee in connection
with the adoption of such child, or any absence for the purpose of
caring for such child for a period immediately following such birth or
placement. For this purpose, Hours of Service shall be credited for the
computation period in which the absence from work begins, only if
credit therefore is necessary to prevent the Employee from incurring a
One-Year Break in Service, or, in any other case, in the immediately
following computation period. The Hours of Service credited for a
"maternity or paternity leave of absence" shall be those which would
normally have been credited but for such absence, or, in any case in
which the plan administrator is unable to determine such hours normally
credited, eight (8) Hours of Service per day. The total Hours of
Service required to be credited for a "maternity or paternity leave of
absence" shall not exceed five hundred one (501).
8
(32) "Participant" - any person who has been admitted to participation in
this Plan pursuant to the provisions of Article II. The term
"Participant" shall include active Participants (those currently
eligible to share in Company Contributions and ESOP Contributions, if
any), inactive Participants (those individuals who are employed by the
Company and have been active Participants but are not eligible to share
in Company Contributions or ESOP Contributions), and any former
Employee who has an Account under the Plan.
(33) "Plan" - the Pre-tax Savings Plan as set forth herein, and as it may be
modified or amended from time to time. Effective January 1, 2002, the
Plan consists of the ESOP Feature and the Non-ESOP Feature.
(34) "Plan Year" - except as otherwise provided herein, a Plan Year shall be
the calendar year beginning January 1 and ending December 31. With
respect to each person becoming employed by the Company or an
Affiliated Company, for purposes of eligibility to participate herein,
the initial Plan Year shall be the calendar year which commences
coincident with or immediately following the Employee's Employment
Date.
(35) "Pre-tax Savings Plan Contribution" - the percentage of a Participant's
Compensation which the Company contributes to the Plan pursuant to a
wage reduction agreement, under which a Participant elects to forego a
percentage of such Compensation, reduced for purposes of the Plan, also
sometimes referred to as a Company Wage Reduction Contribution.
(36) "Severance Date" - the earliest of (a) the date on which the Employee
retires, dies, quits, or is discharged or (b) the date on which the
Employee ceases to accrue Continuous Credited Service in accordance
with the Company-Union basic labor agreement provisions for leave of
absence; but in no event shall the Severance Date, as defined in (a)
and (b), be earlier than the first anniversary of the first day of a
period throughout which the Employee remains absent, with or without
pay, from the service of the Company by reason of the absence.
(37) "Severance Period" - the period of time between the Employee's
Severance Date and the date on which he again performs an Hour of
Service.
(38) "Total and Permanent Disability" - a condition of a Participant as the
result of bodily injury or disease from an unavoidable cause which
prevents such Participant from being physically able to meet his/her
present job requirements as the same existed at the time of the
Participant's cessation of service due to such condition and which
disability will (in the opinion of a qualified physician designated by
the Committee) presumably be permanent and continuous during the
remainder of his/her life. Such condition shall be deemed to have
resulted from an unavoidable cause unless it:
a) was contracted, suffered or incurred while
the Participant was engaged in, or resulted from
having engaged in, a felonious enterprise, or
b) resulted from habitual drunkenness or
addiction to hallucinogenic and/or narcotic drugs not
prescribed by a qualified physician for treatment of
a condition other than drug addiction, or
9
c) resulted from an intentional self-inflicted
injury or self- induced sickness.
(39) "Transaction Period" - a period defined in Article XV herein during
which certain rules and regulations, as established by the Committee
and the Trustee, shall govern all transactions relating to securities.
(40) "Transactions" - all purchases, sales, redemptions or other
dispositions of securities by the Trustee under the Plan.
(41) "Transfer Contributions" - those amounts transferred to the Plan on
behalf of an Employee from another plan qualified under Section 401(a)
of the Code as described in Article III, Section 8.
(42) "Trustee" - the Trustee or Trustees designated by the Company as
provided herein.
(43) "Trust Fund" - assets of the Plan and Trust as the same shall exist
from time to time.
(44) "Unvested" - that portion of a Participant's Account balance which is
not vested pursuant to Article VI herein.
(45) "Vested" - that portion of a Participant's Account balance to which
he/she has a nonforfeitable right pursuant to Article VI herein.
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ARTICLE II
ELIGIBILITY AND PARTICIPATION
SECTION 1 ELIGIBILITY
Any Employee of the Company eligible for membership in the Union who
has completed thirty days of Continuous Credited Service is eligible to
participate in the Plan.
Notwithstanding the foregoing, no Employee who serves only as a leased employee
as defined in Section 414(n) of the Code shall be covered by the Plan or deemed
to be a Participant.
SECTION 2 CONTINUOUS CREDITED SERVICE
(a) Continuous Credited Service for purposes of computing
eligibility shall be defined as the period of time (as
computed by completed 1/12ths of a year) between the
Employee's Employment Date or Adjusted Employment Date and the
current date or the Employee's most recent Severance Date.
(b) Any person who incurs a Severance Period after January 1,
1990, shall have Continuous Credited Service restored on the
following basis:
(i) A person who before the Severance Date had
established a nonforfeitable right to any vested
benefit will for all purposes have pre-Severance
Period and post-Severance Period Continuous Credited
Service aggregated to create an Adjusted Employment
Date.
(ii) A person who before the Severance Date had not
established a nonforfeitable right to any vested
benefit will have Continuous Credited Service
restored on the following basis to create an Adjusted
Employment Date:
(A) If the Severance Period is less than the
Continuous Credited Service prior to the Severance
Date, the Continuous Credited Service prior to the
Severance Date shall be aggregated with any
Continuous Credited Service after the Severance
Period to create an Adjusted Employment Date for all
purposes. Such aggregation of Continuous Credit
Service shall not include any period of time during
the Severance Period.
(B) If the Severance Period equals or exceeds
the greater of five (5) years or the Continuous
Credited Service prior to the Severance Date, the
Continuous Credited Service prior to the Severance
Date shall not be aggregated and the Employee shall
become a Participant as specified in Section 3 of
this Article.
SECTION 3 An Employee described in Section 1 will become a Participant
in the Plan upon satisfaction of all the following requirements:
(a) completion of thirty days of Continuous Credited Service,
11
(b) receipt by the Committee of a completed application,
(c) agreement to an appropriate payroll deduction from his/her
Compensation,
(d) agreement to accept a reduction of his/her Compensation equal
to the whole percentage of his/her Compensation per payroll
period he/she elects to have contributed by the Company as a
Pre-tax Savings Plan Contribution.
A Participant shall cease to be eligible to make contributions to the
Plan and to share in Company Contributions or ESOP Contributions under the Plan
when he/she is no longer an Employee due to: resignation, termination,
retirement, death, Total and Permanent Disability, or otherwise ceasing to be an
Employee or the Participant's voluntary election to suspend participation
pursuant to Article VII hereof. Participation in the Plan will cease when the
Employee or former Employee no longer has an Account under the Plan. A
Participant who voluntarily ceases Active Participation from this Plan while
still an Employee accumulating Continuous Credited Service shall be ineligible
to resume Active Participation for a period of twelve (12) months from the date
Active Participation last ceased.
Notwithstanding the above paragraph, a Participant who retires under
the Company's Bowling Green-Seal Pension and Insurance Agreement may elect to
continue to be a Participant in the Plan and maintain an Account until the
earlier of the date he/she withdraws the balance in his/her Account or April 1
of the calendar year following the calendar year in which he/she attains age
70-1/2. After the effective date of such retirement, such a Participant shall
not be entitled to make contributions to the Plan or share in the allocation of
Company Contributions or ESOP Contributions.
Participation in the Plan by Eligible Employees shall be voluntary.
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ARTICLE III
PARTICIPANTS' CONTRIBUTIONS
SECTION 1 AMOUNT OF PARTICIPANT PRE-TAX SAVINGS PLAN CONTRIBUTION
To be an Active Participant, an eligible individual must have made on
his/her behalf or agree to make a Pre-tax Savings Plan Contribution in the
following manner:
(a) A Participant may agree to have contributed on his/her behalf
as a Pre-tax Savings Plan Contribution, an amount, at his/her
election, not to exceed the lesser of: (i) 15% of his/her
Compensation or (ii) $7,979 (or such greater amount as
determined by the Secretary of Treasury). In calculating the
limit under Code Section 402(g) for purposes of Code Section
401(k), the amounts to be deferred by an eligible Employee
under each plan for which he/she is eligible to make wage
deferrals will be aggregated by treating all cash or deferred
arrangements under which the Employee is eligible as a single
arrangement. If the limit set forth by Code Section 402(g) is
exceeded, then the deferrals in excess of the limits must be
distributed by April 15 of the following year. Such reduction
in Compensation must be made at the time the Participant would
normally receive his Compensation from the Company.
(b) A Participant, by agreeing to have contributed on his/her
behalf a Pre-tax Savings Plan Contribution, shall enter into a
written wage reduction agreement with the Company. The terms
of such reduction agreement shall provide that the Participant
accepts a reduction in his/her Compensation from the Company
equal to any whole percentage of his/her Compensation per pay
period which he/she elects to have contributed on his/her
behalf as a Pre-tax Savings Plan Contribution.
(c) Pre-tax Savings Plan Contributions shall be fully vested and
nonforfeitable at all times.
(d) The Company may amend or revoke its wage reduction agreement
with any Participant at any time, if the Company determines
that such revocation or amendment is necessary to insure that
contributions by or on behalf of a Participant for any Plan
Year will not exceed the limitations of Section 415 or to
insure that the discrimination tests of section 401(k) of the
Code are met for such Plan Year.
(e) If a Participant's Compensation for any Plan Year is such that
he or she is a Highly Compensated Employee for the Plan Year,
the actual deferral percentage test of Section 401(k)(3) of
the Code will be met. The Plan incorporates by reference the
provisions of Sections 401(k)(3) of the Code and regulation
Section 1.401(k) - 1(b) thereunder.
13
SECTION 2 LIMITATIONS ON PARTICIPANT CONTRIBUTIONS
All contributions made by or on behalf of a Participant are subject to
the limitations imposed by section 401(k), and section 415 of the Code as
further set forth in Article XII hereof.
The maximum amount of such contributions is limited under Section
401(k)(3) determined by reducing contributions made on behalf of Highly
Compensated employees in order of their contribution percentages beginning with
the highest of such percentages.
SECTION 3 CHANGING CONTRIBUTION PERCENTAGE
The contribution percentage(s) designated by a Participant shall
continue in effect, notwithstanding any change in his/her Compensation, until
he/she shall change such contribution percentage(s).
A Participant may elect, at any time, but not less than thirty (30)
days from the last change in contribution percentage(s) to increase or decrease
the contribution percentage(s) within the applicable limits to be effective as
soon as practicable after receipt of notice of change.
SECTION 4 CONTRIBUTIONS TO BE EXPRESSED IN WHOLE MULTIPLES
Each Participant's Pre-tax Savings Plan Contributions shall be in whole
multiples of 1% of Compensation, subject to adjustment pursuant to Section 5
hereof.
SECTION 5 METHOD OF PARTICIPANTS' CONTRIBUTIONS
(a) Each Pre-tax Savings Plan Contribution made by the Company on
behalf of a Participant shall be transferred to the Plan
pursuant to the terms of a written wage reduction agreement
between such Participant and the Company. A Participant's wage
reduction agreement shall be modified automatically to
correspond to the change in the amount of the Pre-tax Savings
Plan Contributions made on his/her behalf as set forth in
Section 3 hereof.
(b) The tentative wage reduction amount set forth in any wage
reduction agreement shall be in any amount as the Participant
shall elect, but shall be not less than 1% and not more than
15% of Compensation of such Participant. Tentative wage
reductions shall become final, and then shall constitute
Pre-tax Savings Plan Contributions, only after the Company or
the Committee has made such adjustments thereto as they (or
either of them) deem necessary to maintain the qualified
status of this Plan or to maintain the status of any portion
of this Plan as a qualified cash or deferred arrangement under
section 401(k) of the Code.
(c) All amounts withheld pursuant to a wage reduction agreement
and thereafter contributed to the Plan as Pre-tax Savings Plan
Contributions shall be so delivered only if the Company in
good faith believes that such amounts do not exceed the
amounts permissible pursuant to the limitations hereinabove
set forth. If any amount shall be withheld from the
Compensation of a Participant pursuant to a
14
wage reduction agreement which exceeds the maximum amount
permissible pursuant to Section 5(b) hereof, and if such
amount is contributed to the Plan as a Pre-tax Savings Plan
Contribution by way of a mistake of fact, it shall be refunded
to the Company and shall thereafter be paid as promptly as
practicable (subject, however, to the withholding of taxes and
other amounts as though such amount were current compensation)
by the Company to the Employee from whose Compensation such
amount was obtained pursuant to a wage reduction agreement.
SECTION 6 CREDITING OF CONTRIBUTION AMOUNTS
Company Wage Reduction Contributions shall be transferred by the
Company to the Trustee as soon as practicable, but not less than monthly. All
payments so made by the Company shall be reported to the Committee.
All such contributions shall be appropriately credited to the Account
of each Participant by the Trustee.
SECTION 7 VETERANS
Notwithstanding any provision of this Plan to the contrary, effective
December 12, 1994, contributions, benefits and Continuous Credited Service with
respect to qualified military service will be provided in accordance with
Section 414(u) of the Code. "Qualified military service" means any service in
the uniformed services (as defined in chapter 43 of title 38 of the United
States Code) by any individual if such individual is entitled to reemployment
rights under such chapter with respect to such service.
SECTION 8 TRANSFER CONTRIBUTIONS
The Trustee is authorized to accept on behalf of a Participant, and
hold as part of a Participant's Account, assets from a trustee of another plan
qualified under Section 401(a) of the Code, provided that such other plan
permits such a transfer and provided that the Committee approves such transfer
from such other plan. All amounts so transferred to a Participant's Account
shall be referred to herein as "Transfer Contributions."
SECTION 9 CONTRIBUTIONS MADE TO THE NON-ESOP FEATURE
Effective January 1, 2002, when transmitted to the Plan pursuant to
this Article III, the Pre-Tax Savings Plan Contributions shall be transmitted to
and held under the Non-ESOP Feature of the Plan. As provided in Section 3 and
Section 5 of Article V, such contributions may be transferred later from the
Non-ESOP Feature to the ESOP Feature.
15
ARTICLE IV
COMPANY CONTRIBUTIONS
SECTION 1 AMOUNT OF COMPANY CONTRIBUTIONS
The Company shall contribute to the Trustee out of Current Earnings for
that fiscal year or, at its discretion as set forth below out of its accumulated
earnings, in cash or in its treasury or authorized but unissued Common Stock the
value of which shall be computed at the applicable fair market value on the date
of contribution by the Company, an amount equal to the lesser of:
(a) the aggregate of seventy-five percent (75%) of all Pre-Tax
Savings Plan Contributions which represent up to four percent
(4%) of each Participant's Compensation during such year, less
any forfeitures (as defined in Article VIII, Section 1), or
(b) an amount equal to fifteen percent (15%) of the Company's
Current Earnings for such year in excess of ten percent (10%)
of the stockholder's equity of the Company at the beginning of
such year.
The Company's Board of Directors may, at its discretion, waive the
limitations in paragraph (b) above and contribute to the Trustee out of Current
Earnings for that fiscal year or its accumulated earnings an amount not to
exceed the limitations in paragraph (a) above.
The Company will not match, nor allocate its contributions to, any
portion of Pre-Tax Savings Plan Contributions which represent an amount in
excess of four percent (4%) of a Participant's Compensation during each Plan
Year.
Company Contributions will be subject to the nondiscrimination test
pursuant to Section 401(m)(2) of the Code. For any Plan Year the contribution
percentage for eligible Highly Compensated Employees shall not exceed the
greater of:
(A) 125 percent of such percentage for all other
Eligible Employees, or
(B) 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.
For nondiscrimination testing purposes, the multiple use rules pursuant
to Regulation Section 1.401(m)-2 shall apply. If a correction of multiple use is
required, Pre-Tax Savings Plan Contributions will be distributed as provided by
Regulation Section 1.401(m)-2)(c).
At any time corrections are required to either the nondiscrimination
test or multiple use rules by distributing Pre-tax Savings Plan Contributions
any related Company Contributions will also be distributed or forfeited to avoid
discrimination.
SECTION 2 COMPANY WAGE REDUCTION CONTRIBUTIONS
16
The Company shall contribute with respect to each Plan Year the
aggregate of the Company Wage Reduction Contributions for such Plan Year, as
determined pursuant to wage reduction agreements in force between the Company
and Participants in the Plan. Company Wage Reduction Contributions shall be
fully Vested and nonforfeitable at all times.
SECTION 3 ALLOCATION OF COMPANY CONTRIBUTIONS
The Company Contributions for each fiscal year shall be allocated by
the Trustee to each Participant's Account in proportion to seventy-five percent
(75%) of each Participant's Pre-Tax Savings Plan Contributions made on his/her
behalf up to an aggregate contribution thereof of four percent (4%) of a
Participant's Compensation for such year.
If a Participant or Designated Beneficiary becomes entitled to
distribution of his/her Account under the Plan as a result of the Participant
either retiring from the Company under one of its retirement programs (except a
Deferred Vested Pension), suffering a Total and Permanent Disability or dying
and Pre-Tax Savings Plan Contributions have been made on his/her behalf to which
Company Contributions, if any, are allocated in the year in which such event
(retirement, Total and Permanent Disability, or death) occurred, such
Participant shall be entitled to share in the Company Contribution which it may
make with respect to such year, as herein provided, as if such event had not
occurred.
There shall be directly and promptly allocated to the Pre-Tax Savings
Plan Contributions subaccount of each Participant the Company Wage Reduction
Contributions, as set forth in Section 2 hereof.
Company Contributions will be allocated to the Participant only if the
Participant is employed on the last day of the Plan Year, except in the case of
retirement, Total and Permanent Disability or death.
SECTION 4 REPORTING THE CONTRIBUTIONS
The Company Contributions and Company Wage Reduction Contributions
shall be reported to the Committee by the Company.
SECTION 5 CONTINGENT NATURE OF CONTRIBUTIONS
To the extent that the deductibility thereof is subsequently denied,
each Company Contribution and each Company Wage Reduction Contribution made by
the Company pursuant to the provisions of this Article IV hereof is hereby made
expressly contingent upon the deductibility thereof for federal income tax
purposes for the year with respect to which such contribution is made. Each such
contribution is further contingent upon the maintenance of qualified status by
the Plan for the year with respect to which such contribution is made, to the
extent that the loss of qualified status would deprive the Company of the
deduction taken for such contribution.
SECTION 6 EXCLUSIVE BENEFIT; REFUND OF CONTRIBUTIONS
17
All contributions made by the Company are made for the exclusive
benefit of the Participants and their beneficiaries, and such contributions
shall not be used for nor diverted to purposes other than for the exclusive
benefit of the Participants and their beneficiaries, including the costs of
maintaining and administering the Plan and Trust. Notwithstanding the foregoing,
refunds of Company Contributions shall be made to the Company under the
following circumstances and subject to the following limitations, to the extent
that such refunds do not, in themselves, deprive the Plan of its qualified
status:
(a) To the extent that a Federal income tax deduction is
disallowed for any Company Contribution, the Trustee shall
refund to the Company the amount so disallowed within one (1)
year of the date of such disallowance.
(b) In the case of a contribution, or for any Company Wage
Reduction Contribution, which is made in whole or in part by
reason of a mistake of fact, so much of the Company
Contribution as is attributable to the mistake of fact shall
be returnable to the Company upon demand, upon presentation of
evidence of the mistake of fact to the Trustee and of
calculations as to the impact of such mistake of fact. Demand
and repayment must be effected within one (1) year after the
last installment payment of the contribution to which the
mistake applies.
In the event that any refund of amounts contributed under
Section 1 hereof is paid to the Company, such refund shall be
made without interest and shall be deducted from among the
Company Contributions subaccounts of Participants only to the
extent that the amount of the refund can be identified to
specific Participants (as in the case of certain mistakes of
fact). Refunds of amounts contributed pursuant to Section 2
hereof (relating to contributions attributable to wage
reduction) are treated at Section 6 of Article III.
Notwithstanding any other provision of this Section 6, no
refund shall be made to the Company which is specifically
chargeable to the Account of any Participant in excess of one
hundred percent (100%) of the amount in such Account, nor
shall a refund be made by the Trustee of any funds, otherwise
subject to refund hereunder, which have been distributed to
Participants and/or beneficiaries. In the case that such
distributions become refundable, the Company shall have a
claim directly against the distributees to the extent of the
refund to which it is entitled. All refunds pursuant to this
Section 6 shall be limited in amount, circumstance and timing
to the provisions of Section 403(c) of the Employee Retirement
Income Security Act of 1974, as amended, and no such refund
shall be made if, solely on account of such refund, the Plan
would cease to be a qualified Plan pursuant to Section 401(a)
of the Code.
SECTION 7 TRANSMITTING THE COMPANY CONTRIBUTIONS
Each Company Contribution shall be sent to the Trustee as promptly as
practicable following the determination of the amount thereof, and, in any
event, on or before the date established by law (including any extension
thereof) for the filing of the Company's federal
18
income tax return for the taxable year with respect to which such Company
Contribution is made.
Contributions made pursuant to Section 2 hereof shall be made no later
than the date specified in the preceding sentence, and shall be made at such
earlier dates as may be practicable provided, however, that no wage reduction
amount shall be held by the Company without contributing same to the Plan for a
period longer than the longest period that is permissible under regulations
published under Section 401(k) of the Code, and, in any event, amounts
contributed under Section 2 hereof with respect to any Plan Year shall be deemed
credited to the Pre-Tax Savings Plan Contributions subaccount of the Participant
not later than the last day of such Year.
SECTION 8 CONTRIBUTIONS MADE TO THE NON-ESOP FEATURE
Effective January 1, 2002, when transmitted to the Plan pursuant to
this Article IV, the Company Contributions and Company Wage Reduction
Contributions shall be transmitted to and held under the Non-ESOP Feature of the
Plan. As provided in Section 3 and Section 5 of Article V, such contributions
may be transferred later from the Non-ESOP Feature and ESOP Feature.
19
ARTICLE V
INVESTMENT OF CONTRIBUTIONS
SECTION 1 INVESTMENT OF FUNDS
Except for Unvested Company Contributions and, subject to Section 4 of
Article XVIII, ESOP Contributions, the amounts in a Participant's Account may be
invested on behalf of such Participant in one or more of the following
Investment Options, at the Participant's discretion:
(a) Option A: Cash with Interest. - Cash will be invested in a
fixed income account with a bank, insurance company, or an
investment adviser registered under the Investment Advisers
Act of 1940.
(b) Option B: Mutual Fund(s). - Cash will be invested in one or
more mutual funds approved by the Committee and made available
to Participants.
(c) Option C: A fund comprising a pooled account of Common Stock
of the Company.
The amounts credited to a Participant's Account from, subject to
Section 4 of Article XVIII, the ESOP Contributions and Unvested Company
Contributions shall be invested in the Common Stock fund.
SECTION 2 INSTRUCTIONS TO THE TRUSTEE
A Participant will instruct the Trustee in writing as to the manner in
which his/her contributions in his/her Account, other than Company Contributions
and ESOP Contributions, shall be invested in any one or more of the Investment
Options in such proportions as he/she sees fit, except that the amounts so
specified shall be in multiples of one percent (1%). A Participant may likewise
instruct the Trustee with respect to the retention or investment of the Vested
portion of the Company Contributions subaccount and, subject to Section 4 of
Article XVIII, the ESOP Contributions subaccount allocated to his/her Account,
subject to the same limitations as apply to the investment of the contributions
in his/her Account other than Company Contributions.
Investment instructions with respect to the contributions in his/her
Account other than Company Contributions and ESOP Contributions, and with
respect to the Vested portion of the Company Contributions and, subject to
Section 4 of Article XVIII, the ESOP Contributions subaccount may be different,
both as to the kind of investment and as to the relative amounts to be invested
in such investments. Subject to Section 4 of Article XVIII, the ESOP
Contributions subaccount and the Unvested portion of the Company Contributions
subaccount shall remain invested in the Common Stock fund.
SECTION 3 TRANSFER TO THE ESOP FEATURE
Effective January 1, 2002, any amount of the Participant's Non-ESOP
Account invested in the Common Stock fund shall transfer to the Participant's
ESOP Account as of the first day of the Plan Year immediately succeeding the
Plan Year in which the contributions comprising such
20
amounts invested in the Common Stock fund were made to the Plan. Notwithstanding
the foregoing, any amount in a Participant's Account that is attributable to
contributions made to the Plan prior to January 1, 2002 and that is invested in
the Common Stock fund on December 31, 2001 shall be transferred to the
Participant's ESOP Account effective as of January 1, 2002.
SECTION 4 TRUSTEE OPTIONS
The Trustee is authorized to purchase treasury or authorized but
unissued Common Stock of and from the Company, if offered by it, at the
applicable fair market value.
SECTION 5 CHANGING OF INVESTMENTS
As to the investment of future contributions with respect to which the
Participant has investment discretion, the Participant shall have the right, at
any time, but not more often than once daily, to instruct the Trustee to change
the amounts to be invested in any Investment Option(s) for all his/her
contributions. A Participant shall instruct the Trustee pursuant to this Section
5 with regard to the investment of any portion of the Participant's Account
attributable to Transfer Contributions.
Subject to Section 9 of Article III, Section 8 of Article IV and
Section 3 of this Article V, any amount that the Participant chooses to invest
in the Common Stock fund, pursuant to this Section 5, shall be held in the
Participant's Non-ESOP Account on and after January 1, 2002, subject to transfer
to the Participant's ESOP Account. Effective January 1, 2002, any such amount
invested in the Common Stock fund shall transfer to the Participant's ESOP
Account as of the first day of the Plan Year immediately succeeding the Plan
Year in which the investments were changed into the Common Stock fund. On and
after January 1, 2002, any amount that the Participant chooses to invest in any
Investment Option(s) other than the Common Stock fund, pursuant to this Section
5, shall be held in the Participant's Non-ESOP Account.
All such directions to sell or to redeem securities held in the
Participant's Account or to reinvest the proceeds and all changed investment
directions shall become effective during the Transaction Period, as such term is
defined in Section 1 of Article XV. All such directions received and completed
prior to 4:00 p.m. Eastern Time on a day when both the Trustee and the New York
Stock Exchange are open for business shall be effective as of the close of the
business day of receipt of such directions. All such directions received and
completed after 4:00 p.m. Eastern Time on a day when both the Trustee and the
New York Stock Exchange are open for business shall be effective as of the
following day when both the Trustee and the New York Stock Exchange are open for
business.
SECTION 6 EARNINGS FROM INVESTMENTS
Except as provided in Section 6 of Article XVIII, earnings from the
Investment Options shall be reinvested in the Investment Option producing such
earnings.
SECTION 7 UNINVESTED FUNDS UNDER INVESTMENT OPTIONS
Any funds in the hands of the Trustee as to which the Participant has
instructed the Trustee to invest in any given Investment Option but which
temporarily remains uninvested may
21
be held by the Trustee in cash. Shares of Common Stock shall be in full shares
only, with no fractional shares being purchased or held. Amounts creditable to
the Accounts of Participants which cannot be invested in the Investment Option
selected because such amounts are insufficient to purchase a full share of
Common Stock shall be temporarily held pursuant to this Section 6 as uninvested
funds for the benefit of the Account to which such amount is allocable.
SECTION 8 SELECTION OF INVESTMENT OPTION
The selection of an Investment Option by a Participant will be entirely
the responsibility of such Participant. Neither Trustee, the Committee, the
Company, nor any of its personnel shall be empowered to advise a Participant as
to the manner in which the amounts credited to any Account shall be invested.
The fact that a security is available to Participants for investment under this
Plan shall not be construed as a recommendation for the purchase of that
security, nor shall the designation of any Investment Option impose any
liability on the Trustee, the Committee, the Union, the Company, or any of its
personnel.
22
ARTICLE VI
VESTING OF CONTRIBUTIONS
SECTION 1 VESTING OF PARTICIPANT CONTRIBUTIONS
A Participant shall have a nonforfeitable interest in his/her Account
balance to the extent that it is attributable to contributions made by him/her
or on his/her behalf including (but not limited to) Company Wage Reduction
Contributions (but not including Company Contributions), at all times (subject
to the terms and conditions of Articles IX and XI), and in all assets in his/her
Account attributable thereto.
SECTION 2 VESTING OF COMPANY CONTRIBUTIONS AND ESOP CONTRIBUTIONS
Company Contributions and ESOP Contributions, if any, shall become
Vested to the Participant on the date such Participant completes five (5) years
of Continuous Credited Service (Article II, Section 2). For Participants with
five (5) or more years of Continuous Credited Service, Company Contributions and
ESOP Contributions will become Vested immediately upon being placed in his/her
Account. Notwithstanding the foregoing, a Participant shall at all times be
Vested in any earnings and dividends paid on the investments of Unvested Company
Contributions and ESOP Contributions held in the Participant's Account. Full one
hundred percent (100%) vesting shall also occur upon attainment of the
Participant's Normal Retirement Date.
Should a Participant terminate participation in the Plan by reason of
any of the following, all Company Contributions and ESOP Contributions will
become one hundred percent (100%) Vested to the Participant:
(a) Total and Permanent Disability
(b) Death
(c) Termination of the Plan, (or partial termination of the Plan
if the Participant is affected thereby), or
(d) Complete and final discontinuance of Company Contributions.
If a Participant terminates employment at a time when his/her Company
Contributions and ESOP Contributions are Unvested, such Unvested contributions
shall be forfeited upon the earlier of (i) the distribution to the Participant
of the Vested portion of his/her Account or (ii) the close of five consecutive
Severance Periods after such termination of employment.
SECTION 3 VESTING OF RESTORED COMPANY CONTRIBUTIONS AND ESOP
CONTRIBUTIONS
A Participant who has restored previously forfeited ESOP Contributions
or Company Contributions (as described in Section 7 of Article XI) shall have
these restored ESOP Contributions and Company Contributions vest provided
restoration is made prior to the attainment of five (5) years Continuous
Credited Service by the Participant.
23
ARTICLE VII
SUSPENSION OF PARTICIPATION
SECTION 1 SUSPENSION RESULTING FROM JOB TRANSFER
In the event that a Participant is transferred to a job with the
Company which renders such Participant ineligible to participate actively in
this Plan, then, in such event, such Participant's Active Participation shall be
deemed to be suspended. However, during the period of suspension the
Participant's Account shall continue to be vested as if no suspension had
occurred.
Such suspension shall remain in effect until:
(a) the Participant is transferred to a job whereby he/she would
be re-eligible to be an active Participant in the Plan, or
(b) a termination occurs pursuant to Article XI of the Plan.
24
ARTICLE VIII
APPLICATION OF COMPANY CONTRIBUTIONS FORFEITED
SECTION 1 APPLICATION OF FORFEITURES
All Company Contributions and ESOP Contributions forfeited in
accordance with Article VI, Section 2 shall be used to reduce the Company's
subsequent contributions to the Plan. However, such forfeited Company
Contributions and ESOP Contributions will be restored to the Participant's
Account should the Participant exercise restoration rights as defined in Section
7 of Article XI.
In the event that the Plan is terminated, any forfeitures not
previously applied to reduce Company Contributions shall be credited (on the
basis of each individual Participant's current year Compensation as a ratio to
the total current year Compensation of all Participants) to the Accounts of all
Participants entitled to share in the allocation of Company Contributions at the
time of such termination.
SECTION 2 TREATMENT OF FORFEITED SECURITIES
Forfeited securities shall be converted to cash and be invested by the
Trustee; such cash shall be applied to the reduction of the next contribution by
the Company.
Upon forfeiture of a portion of the Company Contributions or ESOP
Contributions, the Trustee shall sell such amount of the securities allocated to
the Participant's Account as may be necessary to effect the forfeiture.
25
ARTICLE IX
WITHDRAWAL OF CONTRIBUTIONS
SECTION 1 WITHDRAWAL EVENTS
No amount may be withdrawn by a Participant from Company Wage Reduction
Contributions, Company Contributions, or ESOP Contributions earlier than the
occurrence of hardship (see Section 2 below) or one of the following events:
(a) the Participant's retirement, death, Total and Permanent
Disability, or termination of Employee status;
(b) termination of the Plan without establishment of a successor
plan;
(c) the Participant's attainment of age 59 1/2;
(d) the sale or other disposition by the Company to an unrelated
corporation, which does not maintain the Plan, of
substantially all of the assets used in a trade or business,
but only with respect to employees who continue employment
with the acquiring corporation;
(e) the sale or other disposition by the Company of its interest
in a subsidiary to an unrelated entity which does not maintain
the Plan, but only with respect to employees who continue
employment with the subsidiary.
(f) An Eligible Rollover Distribution by a Distributee to an
Eligible Retirement Plan in accordance with the provisions of
Article XI, Section 6.
SECTION 2 HARDSHIP WITHDRAWALS
If a Participant requests a hardship withdrawal prior to the occurrence
of an event in Section 1 above, such request will require the consent of the
Committee and such consent shall be given only if, under uniform rules, the
Committee determines that
(a) the purpose of the withdrawal is to meet immediate and heavy
financial needs of the Participant,
(b) the amount does not exceed such financial need, and
(c) the amount of the withdrawal is not immediately available from
the resources of the Participant.
A withdrawal made on account of hardship must be made first, from
Company Contributions and earnings (if Vested) and then only from Company Wage
Reduction Contributions of the Participant, and not from earnings credited
thereto.
26
Employees who make a hardship withdrawal may not make elective
contributions for the tax year following the tax year of distribution, greater
than the Code Section 402(g) limit minus the elective contributions for the year
of distribution.
SECTION 3 FREQUENCY OF WITHDRAWALS.
Except for distribution at retirement, disability, or death, [Article
XI, Section 2(b)], withdrawals may not be made more frequently than once in any
twelve (12) month period.
27
ARTICLE X
DESIGNATION OF BENEFICIARY
Each Participant must file with the Committee a written designation of
a Designated Beneficiary or Beneficiaries in the form prescribed by the
Committee with respect to all or part of the securities and cash held for the
account of such Participant. Such Designated Beneficiary shall be a
Participant's spouse or, if he/she has no spouse or his/her spouse consents (in
the manner hereinafter described in this Article) to the designation hereinafter
provided for in this Article, such person or persons other than, or in addition
to, his/her spouse as may be designated by a Participant as his/her death
beneficiary under the Plan. Such a designation may be made, revoked or changed
only by an instrument (in form acceptable to the Committee) which is signed by
the Participant, which includes his/her spouse's written consent to the action
to be taken pursuant to such instrument (unless such action results in the
spouse being named as the Participant's sole Beneficiary), and which is filed
with the Committee before the Participant's death. A spouse's consent required
by this Article shall be signed by the spouse, shall acknowledge the effect of
such consent, shall be witnessed by a member of the Committee or by a notary
public and shall be effective only with respect to such spouse. At any time when
all the persons designated by the Participant as his/her Designated Beneficiary
have ceased to exist, his/her Designated Beneficiary shall be his/her spouse or,
if he/she does not then have a spouse, the Participant's estate. If a
Participant has no spouse and he/she has not made an effective Beneficiary
designation pursuant to this Article, his/her Designated Beneficiary shall be
his/her estate.
28
ARTICLE XI
DISTRIBUTION OF CONTRIBUTIONS
SECTION 1 DISTRIBUTION UPON OCCURRENCE OF EVENTS
Subject to the provisions of Section 3 of this Article, distributions
may be made to a Participant or the Designated Beneficiary, as the case may be,
upon the occurrence of the following stated events:
(a) Termination of a Participant's participation in the Plan, or
cessation of the Participant's right to share in the
allocation of the Company Contributions or ESOP Contributions
made to the Plan (other than a temporary cessation on account
of a temporary suspension of Participant contributions), or
(b) Termination of the Plan without establishment of a successor
plan, or
(c) The sale or other disposition by the Company to an unrelated
corporation, which does not maintain the Plan, of
substantially all of the assets used in a trade or business,
but only with respect to employees who continue employment
with the acquiring corporation, or
(d) The sale or other disposition by the Company of its interest
in a subsidiary to an unrelated entity which does not maintain
the Plan, but only with respect to employees who continue
employment with the subsidiary.
Effective as of January 1, 1998, if the present value of any
nonforfeitable accrued benefit, at the time of distribution or at the time of
any subsequent distribution, exceeds $5,000 such benefit may not be immediately
distributed without the consent of the Participant.
SECTION 2 TERMINATION OF A PARTICIPANT'S ACTIVE PARTICIPATION IN THE
PLAN
A Participant's Active Participation in the Plan will be terminated if
he/she:
(a) Voluntarily elects to cease contributions to the Plan,
(b) Terminates employment from the Company voluntarily or
involuntarily,
(c) Retires from the Company under one of its retirement programs,
(d) Suffers a Total and Permanent Disability,
(e) Dies.
(f) Becomes Vested in all Company Contributions and ESOP
Contributions in his/her Account and remains in a job whereby
he/she is ineligible to be an active Participant in the Plan.
29
SECTION 3 DISTRIBUTION PRIOR TO VESTING OF COMPANY CONTRIBUTIONS AND
ESOP CONTRIBUTIONS
If a Participant terminates employment with the Company, either
voluntarily or involuntarily, before the Company Contributions or ESOP
Contributions are Vested, the Participant will receive the then current market
value of the larger of:
(a) the Participant's Pre-Tax Savings Plan Contributions, plus all
earnings (not to exceed the current market value of the entire
Account), or
(b) the current market value of the entire Account less the
Unvested Company Contributions and Unvested ESOP
Contributions.
If a Participant, who remains an employee of the Company but is not at
least age 59 1/2, voluntarily elects to withdraw from the Plan before any of the
Company Contributions or ESOP Contributions are Vested, he/she will receive the
amount described above in this Section 3, less the then current market value of
his/her Pre-Tax Savings Plan Contributions subaccount. Such Participant shall,
upon attainment of age 59 1/2, receive the then current market value of his/her
Pre-Tax Savings Plan Contributions subaccount.
SECTION 4 DISTRIBUTION AFTER VESTING OF COMPANY CONTRIBUTIONS AND ESOP
CONTRIBUTIONS
Subject to Article XI, Section 1, if a Participant terminates
employment with the Company after Company Contributions and ESOP Contributions
are Vested, the Participant will receive the then current market value of the
entire Account when he/she elects to make a voluntary withdrawal.
If a Participant, who remains an Employee of the Company but is not at
least age 59 1/2, voluntarily elects to withdraw from the Plan after Company
Contributions and ESOP Contributions are Vested, or remains in a job whereby
he/she is ineligible to be an active Participant in the Plan, he/she will
receive the amount described above in this Section 4, less the then current
market value of his/her Pre-Tax Savings Plan Contributions subaccount. Such
Participant shall, upon attainment of age 59 1/2, receive the then current
market value of his/her Pre-Tax Savings Plan Contributions subaccount. If a
Participant who remains employed by the Company and who has attained age 59 1/2,
voluntarily elects to withdraw from the Plan after he/she becomes Vested in
Company Contributions and ESOP Contributions credited to his/her Account, he/she
will receive the entire amount described in this Section 4 as if he/she had
terminated employment with the Company.
SECTION 5 DISTRIBUTION UPON RETIREMENT, DEATH OR DISABILITY
If a Participant dies, retires or suffers a Total and Permanent
Disability, the Participant or Designated Beneficiary will receive the then
current market value of his/her Account. Distribution will not occur upon
retirement or Total and Permanent Disability in the event a Participant elects
to defer the commencement of distribution in accordance with Section 6 of this
Article.
30
SECTION 6 DISTRIBUTION OF ACCOUNTS
(a) Form of Distribution of Accounts to a Participant During
His/Her Lifetime:
If a Participant terminates participation in the Plan, due to
a separation from service or, if earlier, age 59 1/2,
distribution shall be made, subject to other limitations of
this Plan, by one of the following methods as he/she shall
elect:
(i) Payment in cash, or
(ii) If the Participant has selected one or more of the
Investment Options:
(A) payment in cash,
(B) payment in securities held for the
Participant's Account, or
(C) a combination of (i) and (ii) above at the
option of the Participant.
(b) Distribution of Cash and/or Securities
Distribution of cash and/or securities to a Participant who
either (i) retires from the Company under one of its retirement programs, (ii)
suffers a Total and Permanent Disability, or (iii) dies, or (iv) becomes Vested
in all Company Contributions and ESOP Contributions in his/her Account and
remains in a job whereby he/she is ineligible to be an active Participant in the
Plan, shall be made, at the Participant's or Designated Beneficiary's option, in
one of the following forms:
(i) A single distribution to be received within ninety
(90) days from the date the Participant terminated
participation in the Plan,
(ii) Two (2) installment distributions, with the first
installment to be at least fifty percent (50%) of the
Participant's Account balance (as determined in
Section 3, 4 or 5 of this Article) and to begin
within ninety (90) days from the date the Participant
terminated participation in this Plan, and the second
and final installment to include the remainder of the
Account balance and to be received within twenty-four
(24) months after the date the Participant terminated
participation in this Plan.
(iii) For events described in Section 1(c) or 1(d) of this
Article, distribution will be made in a lump sum as
provided by Section 401(k)(10) of the Code.
Distribution of cash and/or securities to a Participant who
voluntarily elects to withdraw from the Plan or terminates employment from the
Company, voluntarily or involuntarily, shall be made in a single distribution to
be received within ninety (90) days from the date the Participant terminated
participation in the Plan.
31
Notwithstanding the foregoing, a Participant who retires from
the Company under one of its retirement programs (except a deferred vested
pension) may elect to defer the commencement of distribution and remain a
Participant in this Plan until no later than April 1 of the calendar year
following the calendar year in which he/she attains age 70-1/2.
Should the Participant fail to select a form of distribution
as previously described, the final distribution will be made in a single
distribution as described in Section 6(b) (1) of this Article, in the form of
the Investment Option(s) then in the Account.
If a Participant should die before (all) distribution(s) has
(have) been made, such distribution(s) shall be made to the Designated
Beneficiary.
(c) Distribution in Case of the Death of a Participant While an
Employee
In the event of the death of a Participant while an Employee,
distribution shall be made in accordance with Article X. Each Designated
Beneficiary shall make an appropriate election as provided in Section 6(b) of
this Article.
If the Designated Beneficiary should die before the final
distribution has been made then such final distribution shall be made to the
legally appointed representative(s) of the Designated Beneficiary.
(d) Direct Rollover of Eligible Rollover Distributions
This subsection applies to distributions made on or after January 1,
1993. Notwithstanding any provision of the Plan to the contrary that would
otherwise limit a Distributee's election under this subsection, a Distributee,
as defined under paragraph (1)(iii) of this subsection, may elect, at the time
and in the manner prescribed by the plan administrator, to have any portion of
an Eligible Rollover Distribution, as defined under paragraph (1)(i) of this
subsection, paid directly to an Eligible Retirement Plan, as defined under
paragraph (1)(ii) of this subsection, specified by the Distributee in a Direct
Rollover, as defined under paragraph (1)(iv) of this subsection.
(i) Definitions
(A) Eligible Rollover Distribution: An Eligible
Rollover Distribution is any distribution of all or
any portion of the balance to the credit of the
Distributee except that an Eligible Rollover
Distribution does not include any distribution to the
extent such distribution is required under section
401(a)(9) of the Code, any distribution that is one
of a series of substantially equal periodic payments
(paid not less frequently than annually) over the
life (or life expectancy) of the distributee or the
joint lives (or life expectancies) of the distributee
and a designated beneficiary or for a specified
period of ten years or more, the portion of any
distribution that is not includible in gross income,
such other amounts specified in Treasury regulations
and rulings, notices or announcements issued under
Section 402(c) of the Code, and, effective January 1,
1999, any "hardship" distribution (as defined in Code
Section 401(k)).
32
(B) Eligible Retirement Plan: An Eligible
Retirement Plan is an individual retirement account
described in section 408(a) of the Code, an
individual retirement annuity described in section
408(b) of the Code, an annuity plan described in
section 403(a) of the Code, or a qualified trust
described in section 401(a) of the Code, that accepts
the Distributee's Eligible Rollover Distribution.
However, in the case of an Eligible Rollover
Distribution to the surviving spouse, an Eligible
Retirement Plan is an individual retirement account
or individual retirement annuity.
(C) Distributee: A Distributee includes a
Participant or the Participant's surviving spouse or
Participant's former spouse who is the alternate
payee under a qualified domestic relations order, as
defined in section 414(p) of the Code.
(D) Direct Rollover: A Direct Rollover is a
payment by the Plan to the Eligible Retirement Plan
specified by the Distributee.
(e) Miscellaneous Provisions Relating to Distributions
Any distribution to which a Participant or the Designated Beneficiary
may be entitled shall have deducted therefrom all incident expenses and/or
taxes.
The Committee shall be notified upon forms prescribed by it as to all
actions which are to be taken under this Section by a Participant or Designated
Beneficiary.
The Trustee shall be notified in writing by the Committee concerning
any action required by the Trustee to be taken under this Section.
Unless the Participant elects otherwise, in no event shall any
retirement, death, or disability benefit commence later than the sixtieth (60th)
day after the latest of the close of the Plan Year in which (1) occurs the date
on which the Participant attains the earlier of age 65 or the normal retirement
age specified hereunder (if other than 65) (whether or not by reason of
reference to the Company's retirement programs), (2) occurs the tenth
anniversary of the year in which the Participant commenced participation in the
Plan, or (3) the Participant terminates service with the Company.
(f) Provision Pursuant to Code Section 401(a)(9)
All distributions required under this Article XI shall be determined
and made in accordance with the proposed regulations under Code Section
401(a)(9) including the minimum distribution incidental benefit requirement of
section 1.401(a)(9)-2 of the proposed regulations, as may be amended or
promulgated from time to time.
(i) Notwithstanding any other provision of the Plan, for
individuals who are five percent (5%) owners (as
defined in Section 416 of the Code) or who attain age
seventy and one-half (70 1/2) in Plan Years prior to
2003, the entire interest of each such Participant
under the Plan shall be distributed,
33
commencing not later than April 1 of the calendar
year following the calendar year in which he/she
attains age seventy and one-half (70 1/2).
For individuals who are not five percent (5%) owners
(as defined in Section 416 of the Code) and who
attain age seventy and one-half (70 1/2) in Plan
Years after 2002, the entire interest of each such
Participant in the Plan shall be distributed to
him/her by April 1 of the calendar year following the
later of either:
(A) the calendar year in which the Employee
attains age seventy and one-half (70 1/2), or
(B) the calendar year in which the Employee
retires.
Such distribution shall be (1) in accordance with
regulations prescribed by the Secretary of the
Treasury, over the life of such Participant and
his/her Designated Beneficiary, or (2) in accordance
with such regulations, over a period not extending
beyond the life expectancy of such Participant or the
life expectancy of such Participant and his/her
Designated Beneficiary.
(ii) If distribution of a Participant's interest under the
Plan has begun in accordance with paragraph (i) of
this subsection and such Participant dies before
his/her entire interest has been distributed to
him/her, the remaining portion of such interest shall
be distributed to his/her Designated Beneficiary at
least as rapidly as under the method of distribution
being used under such paragraph (i) as of the date of
his/her death.
(iii) If a Participant dies before the distribution of
his/her interest under the Plan has begun in
accordance with paragraph (i) of this subsection, the
entire interest of the Participant shall be
distributed to his/her Designated Beneficiary within
five (5) years after such Participant's death;
provided, however, that such five-year rule shall not
be applicable to any portion of the Participant's
interest under the Plan which is payable to any
individual designated by the Participant as his/her
Designated Beneficiary if:
(A) such portion will be distributed (in
accordance with regulations prescribed by the
Secretary of the Treasury) over the life of such
Designated Beneficiary, and
(B) such distributions to such Designated
Beneficiary begin not later than one year after the
date of the Participant's death or such later date as
the Secretary of the Treasury may by regulations
prescribe or, if such Designated Beneficiary is the
Participant's surviving spouse, not later than the
date on which the Participant would have attained age
70-1/2.
34
(iv) If the Participant's surviving spouse is his/her
Designated Beneficiary and such spouse dies before
the distributions to such spouse begin, paragraph (3)
shall be applied as if the surviving spouse were the
Participant.
(v) Under regulations prescribed by the Secretary of the
Treasury, for purposes of this subsection, any amount
paid to a child shall be treated as if it had been
paid to the surviving spouse if such amount will
become payable to the surviving spouse upon such
child reaching majority (or other designated event
permitted under such regulations).
SECTION 7 RESTORATION OF FORFEITED COMPANY CONTRIBUTIONS AND ESOP
CONTRIBUTIONS
Each Participant who has forfeited any Company Contributions or ESOP
Contributions has the right to gain restoration of the forfeited Company
Contributions and ESOP Contributions. A Participant who (i) terminates
participation in this Plan pursuant to Sections 2(a), (b) or (c) of this Article
XI, (ii) ceases to be an Employee of the Controlled Group, (iii) forfeits his
Unvested Company Contributions and ESOP Contributions pursuant to clause (i) of
the third paragraph of Section 2 of Article VI and (iv) subsequently becomes
rehired by the Controlled Group, will have the right within the earlier of (1)
five (5) years after re-employment or (2) the close of five (5) consecutive
Severance Periods commencing after the date of distribution, to restore to the
Account the dollar value of the previously forfeited Company Contributions and
ESOP Contributions by contributing back to the Account the total lump sum amount
(dollar value as of the date of distribution) of the distribution which caused
the forfeiture.
SECTION 8 DETERMINATION OF VALUE
Determinations of value hereunder shall be made pursuant to an annual
valuation by the Trustee at the fair market value as of the close of business on
the annual valuation date to be established by the Trustee. If no such date is
established, the annual valuation date shall be the last day of the Plan Year.
Interim valuations, or partial valuations of one or more of the investment
funds, may occur upon the direction of the Committee. The then current value of
a Participant's Account, or any part thereof, as of any date, shall be
determined by reference to the valuation (whether or not the annual valuation)
coincident with or last preceding the date as of which such Account is to be
valued.
35
ARTICLE XII
MAXIMUM CONTRIBUTION LIMITATION
SECTION 1 PROVISION PURSUANT TO CODE SECTION 415(c)
(a) MAXIMUM ANNUAL ADDITION: The "annual addition" to a
Participant's Account shall not exceed the lesser of (i)
$30,000 (as adjusted, effective January 1, 1995, pursuant to
Section 415(d) of the Code) or (ii) twenty-five percent (25%)
of the Participant's Compensation (as defined in paragraph (d)
below) for that Plan Year. The Compensation limitation in
(a)(ii) above shall not apply to amounts treated as Annual
Additions under Sections 415(l)(1) or 419A(f)(2) of the Code.
The term "annual addition" means the amount allocated to a
Participant's Account during the limitation year (as hereinafter defined) that
constitutes:
(i) Forfeitures;
(ii) all Employee contributions;
(iii) amounts allocated to an individual medical account,
as defined in section 415(1)(2) of the Code, which is
part of a pension or annuity plan maintained by the
Company are treated as annual additions to a defined
contribution plan. Also amounts derived from
contributions paid or accrued which are attributable
to post-retirement medical benefits, allocated to the
separate account of a key employee, as defined in
section 419A(d)(3) of the Code, under a welfare
benefit fund, as defined in section 419(e) of the
Code, maintained by the Company are treated as annual
additions to a defined contribution plan; and
(iv) all Company Contributions
Any amount which may be excluded from the computation of annual
additions under Treas. Reg. 1.415-6 shall be excluded from such computation.
In addition, all defined contribution plans of the Company, terminated
or not, shall, for purposes of these limitations, be considered as one Plan.
(b) LIMITATION YEAR: For purposes of determining "annual
additions", the Limitation Year shall be the Plan Year.
(c) In the case of a group of Companies which constitutes a
controlled group of corporations (as defined in Section
1563(a) of the Code), all such Companies shall be considered a
single Company or employer for purposes of applying the
limitation of Section 415 of the Code.
(d) COMPENSATION. For purposes of this Section 1, Compensation
shall mean compensation within the meaning of Section
415(c)(3) of the Code and the regulations thereunder. For
limitation years beginning on and after January 1,
36
2001, for purposes of applying the limitations described in
this section, compensation paid or made available during such
limitation years shall include elective amounts that are not
includible in the gross income of the employee by reason of
Section 132(f)(4) of the Code.
(e) ADJUSTMENT FOR EXCESSIVE CONTRIBUTION. If, as a result of the
allocation of forfeitures, a reasonable error in estimating a
Participant's Compensation, or under other facts and
circumstances provided for under Treasury Regulation 1.415-
6(b)(6), the annual addition to a Participant would exceed the
maximum provided in this Section 1, the administrator shall
return any voluntary Participant contributions credited for
the Limitation Year to the extent the return would reduce the
excess amounts in the Participant's Accounts; to the extent
excess amounts continue to exist, the excess amounts shall be
allocated and reallocated to other Participants in the Plan.
However, if such allocation or reallocation of the excess
amounts causes the limitations of Section 415 to be exceeded
with respect to each Plan Participant for the Limitation Year,
then such amounts shall be held unallocated in a suspense
account (the "Section 415 Suspense Account"). If a Section 415
Suspense Account is in existence at any time during a
particular Limitation Year, other than the Limitation Year
described in the preceding sentence, all amounts in the
Section 415 Suspense Account shall be allocated and
reallocated (subject to the limitations of Section 415) before
any contributions by the Company which would constitute annual
additions may be made to the Plan for that Limitation Year.
The Section 415 Suspense Account shall not share in any
earnings or losses of the Trust Fund.
SECTION 2 PROVISION PURSUANT TO SECTION 415(e) OF THE CODE
This Section 2 shall not apply after December 31, 1999.
(a) Except as otherwise provided in Section 415(e) of the Code, in
any case in which an individual is a participant in both a
defined benefit plan and a defined contribution plan
maintained by the Affiliated Group, the sum of the defined
benefit plan fraction and the defined contribution plan
fraction for any Plan Year commencing on or after the
Effective Date shall not exceed 1. For purposes of the
preceding sentence,
(i) 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 lesser of
(A) the product of 1.25, multiplied by the dollar
limitation in effect under Section 415(b)(1)(A) of
the Code for such Year, or (B) the product of 1.4,
multiplied by the amount which may be taken into
account under Section 415(b)(l)(B) of the Code with
respect to such participant under the plan for such
Year; and
(ii) 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
37
account as of the close of the Plan Year and for all
prior Plan Years, and (ii) the denominator of which
is the sum of the lesser of the following amounts
determined for such Plan Year and for each prior Plan
Year of service with the Affiliated Group;
(A) the product of 1.25, multiplied by the
dollar limitation in effect under Section
415(c)(1)(A) of the Code for such Plan Year, or
(B) the product of 1.4, multiplied by the amount
which maybe taken into account under Section-415(c)
(1)(B) of the Code with respect to such participant
under such plan for such Plan Year.
(b) Such reductions as are necessary to comply with the
limitations of this Section with respect to a Participant in
this Plan shall be made in his/her accrued benefit in
accordance with applicable law; provided, however, that
reductions shall first be made in accrued benefits in
accordance with the provisions of any defined contribution
plan of a controlled group member in which the Participant
also participates prior to reduction in annual additions
pursuant to a defined benefit plan, and to that end the
Company shall reduce such accrued benefits to the extent
necessary so that the defined contribution fraction set forth
in Subsection (a) (1) of this Section is reduced so that such
limitations are not exceeded, and reduction of annual
additions shall then be made in accordance with the provisions
of this Plan as are necessary to comply with the limitations
of this Section.
SECTION 3 ANTI-DISCRIMINATION TEST
Notwithstanding the terms of the Plan, the Pre-tax Savings Plan
Contributions of a Participant shall be limited, to the extent necessary to
satisfy the anti-discrimination tests set forth in Code Section 401(k)(3). For
each Plan Year the Average Actual Deferral Percentage for the Highly Compensated
Employees with respect to any Plan Year shall not exceed the greater of (a) or
(b):
(a) The average Actual Deferral Percentage for the Eligible
Employees who are Non-Highly Compensated Employees for the
Plan Year multiplied by 1.25, or
(b) The Actual Deferral Percentage for the Eligible Employees who
are Non-Highly Compensated Employees multiplied by 2;
provided, however, that the Average Actual Deferral Percentage
for the Highly Compensated Employees may not exceed the Actual
Deferral Percentage for the Eligible Employees who are
Non-Highly Compensated Employees by more than two (2)
percentage points (or such lesser amount as determined by the
Secretary of Treasury).
If, at any time during a Plan Year, the Actual Deferral Percentage for
the Highly Compensated Employees exceeds or is reasonably expected by the
Committee to exceed the greater of (a) or (b) above, then the Committee, in its
sole and absolute discretion, shall distribute the Excess Contributions (as
hereinafter defined) and income allocable to the contributions to the Highly
Compensated Employees on whose behalf such Excess Contributions were made. For
purposes of this Section 3, Excess Contributions shall mean the amount
determined pursuant to
38
Section 401(k)(8)(B) of the Code. A Participant's Excess Contribution shall be
reduced, as determined by Secretary of the Treasury, by the amount of any Excess
Deferrals which are distributed to the Participant pursuant to Section 1 of
Article III. Any distribution of the Excess Contributions shall be made to each
Highly Compensated Employee based on his respective portion of the Excess
Contributions by reducing the amount of Pre-Tax Savings Plan Contributions
actually paid over to the Trust on behalf of the Employee whose Pre-Tax Savings
Plan Contribution is the greatest of the Highly Compensated Employees until such
Participant's Pre-Tax Savings Plan Contribution is equal to the Pre-Tax Savings
Plan Contribution of the Highly Compensated Employees whose Pre-Tax Savings Plan
Contribution is the second greatest and continuing to prospectively reduce the
amount of Company Contributions to be paid over to the Trust on behalf of the
Highly Compensated Employees in a like manner until the Actual Deferral
Percentage of the Highly Compensated Employees equals (by rounding up) for the
Plan Year the greater of (a) or (b) above.
The income allocable to a Participant's Excess Contributions shall be
determined by multiplying the income allocable to the Participant's Pre-tax
Savings Plan Contribution by a fraction, the numerator of which is the
Participant's Excess Contribution and the denominator of which is the
Participant's balance in his Company Wage Reduction Contribution Account as of
the last day of the Plan Year.
The Excess Contributions which would otherwise be distributed to the
Participant shall be adjusted for income; shall be reduced, in accordance with
regulations, by the amount of Excess Deferrals distributed to the Participant;
shall, if there is a loss allocable to the Excess Contributions, in no event be
less than the lesser of the Participant's Accounts under the Plan or the
Participant's Company Wage Reduction Contribution for the Plan Year.
Amounts distributed under this Section 3 shall be treated as a
reduction in the amount of Compensation to be reduced pursuant to Section 1 of
Article III by each Participant.
In calculating the actual deferral percentage for purposes of section
401(k), the actual deferral ratio of a Highly Compensated Employee will be
determined by treating all cash or deferred arrangements under which the Highly
Compensated Employee is eligible (other than those that may not be permissively
aggregated) as a single arrangement.
This paragraph shall apply until January 1, 1997. In the case of a
Highly Compensated Employee who is one of the ten most Highly Compensated
Employees and is thereby subject to the family aggregation rules of section
414(q)(6), the actual deferral ratio (ADR) for the family group (which is
treated as one Highly Compensated Employee) is the ADR determined by combining
the elective contributions, compensation and amounts treated as elective
contributions of all eligible family members. Except to the extent taken into
account in the preceding sentence, the elective contributions, compensation, and
amounts treated as elective contributions of all family members are disregarded
in determining the Actual Deferral Percentages for the groups of Highly
Compensated Employees and nonhighly compensated employees.
This paragraph shall apply until January 1, 1997. In the case of a
Highly Compensated Employee whose ADR is determined under the family aggregation
rules, the determination of the amount of excess contributions shall be made as
follows: The ADR is reduced in accordance
39
with the "leveling" method described in section 1.401(k)-1(f)(2) of the
regulations and the excess contributions are allocated among the family members
in proportion to the contributions of each family member that have been
combined.
Failure to correct Excess Contributions by the close of the Plan Year
following the Plan Year for which they were made will cause the Plan to fail to
satisfy the requirements of Code Section 401(k)(3) for the Plan Year for which
the Excess Contributions were made and for all subsequent years they remain in
the Trust Fund. The Company will be liable for a ten percent (10%) excise tax on
the amount of Excess Contributions unless they are corrected within two and
one-half (2 1/2) months after the close of the Plan Year for which they were
made.
To the extent required by the Code and Treasury Regulations, the
limitations set forth in Section 2 shall be applied separately to each of the
Non-ESOP Feature and the ESOP Feature. Notwithstanding the foregoing, for
purposes of applying this Section 3 for any Plan Year in which
(a) the ESOP Feature is maintained, and
(b) the requirements of Sections 401(k)(12) and 401(m)(11) of the
Code are not satisfied
a single Actual Deferral Percentage will be calculated for the group of
eligible Employees who are Highly Compensated Employees and a single Actual
Deferral Percentage will be calculated for the group of Eligible Employees who
are Non-Highly Compensated Employees for the Plan Year, notwithstanding the
existence of the ESOP portion of the Plan and the disaggregation rules of
Treasury Regulation Sections 1.401(k)-1(g)(11) and 1.410(b)-7(c)(2), by reason
of the fact that, notwithstanding the ESOP, all Pre-Tax Savings Plan
Contributions made in such Plan Year are allocated to the Pre-Tax Savings Plan
Contribution subaccount of the Participant's Non-ESOP Account in such Plan Year
(including any Pre-Tax Savings Plan Contributions that are invested in Common
Stock) and such account is not part of the ESOP, and all Company Contributions
made in such Plan Year are allocated to the Company Contribution subaccount of
the Participant's Non-ESOP Account in such Plan Year (including any Company
Contributions that are invested in Common Stock) and such account is not part of
the ESOP.
40
ARTICLE XIII
RESERVED
41
ARTICLE XIV
ADMINISTRATION OF THE PLAN
SECTION 1 SAVINGS PLAN COMMITTEE
The Plan shall be administered by the Defined Contribution Plan
Committee which shall be appointed by the Board of Directors of the Company.
The Committee shall consist of at least three (3) members who shall be
designated from time to time by the Board of Directors of the Company, and shall
act by at least a majority of members.
The Committee, by a majority vote of its members, shall appoint a plan
administrator, chairman and secretary. The plan administrator as appointed by
the Committee shall be the "Named Fiduciary" of the Plan with respect to
administrative matters, and the Trustee shall be the "Named Fiduciary" with
respect to the handling of Plan assets.
The Board of Directors shall, from time to time, notify the Trustee of
the number and the identity of the members of the Committee and the Trustee
shall be entitled to rely upon such notices.
SECTION 2 ADMINISTRATION OF THE PLAN BY THE COMMITTEE
The Committee shall adopt such uniform and nondiscriminatory
administrative regulations under the Plan as it shall deem to be necessary or
appropriate for the efficient administration of the Plan.
The Committee shall have sole and absolute discretion to interpret the
provisions of the Plan or Trust Agreement (including, without limitation, by
supplying omissions from, correcting deficiencies in, or resolving
inconsistencies or ambiguities in, the language of the Plan or Trust Agreement),
to make factual findings with respect to any issue arising under the Plan, to
determine the rights and status under the Plan of Participants and other
persons, to decide disputes arising under the Plan and to make any
determinations and factual and other findings with respect to the benefits
payable thereunder and the persons entitled thereto as may be required for the
purposes of the Plan. In furtherance of, but without limiting, the foregoing,
the Committee is hereby granted the following specific authorities, which it
shall discharge in its sole and absolute discretion in accordance with the terms
of the Plan (as interpreted, to the extent necessary, by the Committee):
(a) to resolve questions (including factual questions) arising
under the provisions of the Plan as to any individual's
entitlement to become a Participant;
(b) to determine the amount of benefits, if any, payable to any
person under the Plan (including, to the extent necessary,
making any factual findings with respect thereto); and
(c) to conduct the review procedure specified in Section 3(g) of
this Article.
42
The Committee shall have full power and authority to administer the
Plan and to interpret its provisions, and its interpretations shall be final and
binding upon the Company, its personnel, the Union, the Trustee and all other
parties in interest, subject to the provisions of Section 3 of this Article.
SECTION 3 FIDUCIARY PROVISIONS
(a) Named Fiduciaries
Among the named fiduciaries under the Plan shall be the
Company, and the Trustee, investment advisors or insurance
companies, each of which shall have such powers, duties,
responsibilities and authority as shall be specified in the
Plan or trust agreement entered into for the purpose of
managing the Trust Fund, subject to any delegation thereof as
provided in the Plan or such trust agreement. Any other
person, entity, committee, board, department, office, or
identifiable part of any legal entity may be designated by the
Company as a named fiduciary by an instrument signed by the
Company, delivered to such designated named fiduciary and to
the Trustee and accepted in writing by the designated named
fiduciary. Any such designation may be terminated at any time
by the Company or by such named fiduciary by written notice
delivered to the other of them and to the Trustee.
(b) Liability of Fiduciaries
To the extent permitted by law, (1) neither the Company nor
any director, officer, or Employee shall be personally liable
upon any contract or other instrument made or executed by
him/her or it or in his/her or its behalf in the
administration of the Plan or the Trust Fund; (2) neither the
Company nor any director, officer, or Employee who is a
fiduciary shall be liable for the neglect, omission or
wrongdoing of any other fiduciary; (3) the Company, person,
committee or board and each member thereof to whom the Company
delegates (or the Plan or trust agreement assigns) any duty
with respect to the Plan or Trust Fund, may rely and shall be
fully entitled to act upon the advice of counsel, who may be
of counsel for the Company, and upon the opinion, certificate,
valuation, report, recommendation or determination of an
actuary appointed by the Company to assist in the operation of
the Plan; (4) the Company and each director, officer, or
Employee who is a fiduciary shall be solely responsible for
his/her own acts or omissions; and (5) if any responsibility
of the Company or of a director, officer, or Employee who is a
fiduciary is allocated to any other person or if a person is
designated to carry out any responsibility in accordance with
the provisions of the Plan or trust agreement, then such
fiduciary shall not be responsible for any act or omission of
such person in carrying out such responsibility.
(c) Delegation of Fiduciary Duties
The Company may delegate to any person, entity, committee,
board, department, office, or identifiable part of any legal
entity any one or more powers, functions,
43
duties or responsibilities with respect to the Plan or the
Trust Fund, provided that no such power, function, duty or
responsibility which is assigned to a fiduciary (other than
the Company) pursuant to some other Section of the Plan or the
trust agreement shall be so delegated without the written
consent of such fiduciary.
Any delegation pursuant to the preceding provisions: (1) shall
be signed by the Company and be delivered to and accepted in
writing by the delegate, (2) shall contain such provisions and
conditions relating to such delegation as the Company deems
appropriate, (3) may be amended from time to time by written
agreement signed on behalf of the Company and the delegate and
(4) may be revoked (in whole or in part) at any time by
written notice from the Company delivered to the delegate or
from the delegate to the Company.
(d) Personal Liability of Non-Fiduciaries
Except for gross neglect or malfeasance, no non-fiduciary
officers, directors or Employees of the Company shall be
personally liable for acts done hereunder or related hereto,
or for the making, retention or sale of any contract or
contracts made as herein provided, or for the failure to
invest or reinvest any funds or for any loss to or diminution
of the Trust Fund, nor shall any of them be personally liable
for or answerable to any Participant or any other person in
connection with any exercise of discretion under the terms of
this instrument relating to the payment or non-payment of
benefits.
(e) Defense of Fiduciaries and Non-Fiduciaries
The Company shall, at its expense, defend or provide for the
defense of any or all fiduciary or non-fiduciary officers,
directors or employees of the Company against any such claims,
allegations, suits, or charges relating to or incidental to
the above matter, and shall continue to do so in any given
cases, unless and until it shall clearly appear that gross
neglect or malfeasance is involved in any such particular
case.
(f) Claims for Benefits
Claims for benefits from this Plan shall be submitted to the
designated representative of the Committee on such forms as
may be designated by the Committee.
(g) Appeals Procedure
Upon the denial of any form of benefit, either partial or
total, the Participant or Designated Beneficiary shall have
the right to receive from the Committee a written notice
stating:
(i) The specific reason for denial,
(ii) The pertinent Section of the Plan on which the denial
was based,
44
(iii) Other information the Committee may feel necessary to
explain the denial, and
(iv) An explanation of the claims review procedure.
The Participant, Designated Beneficiary or a duly authorized
representative, may, within ninety (90) days of such denial, file with the Plan
Administrator an appeal for review of denial of benefits. In considering any
appeal pursuant to this Section 3(g), the Plan Administrator shall have the same
powers to interpret the Plan and make factual findings with respect thereto as
are granted to the Committee under Section 2 hereof. The Participant, Designated
Beneficiary or duly authorized representative shall have the right to examine
all pertinent documents relating to the original denial within sixty (60) days
of the filing date of such appeal, the Committee shall review such appeal and
provide the Participant a decision as to denial or approval. Such decision shall
be in writing and shall cover all pertinent facts considered in making the
decision.
SECTION 4 ACTION BY THE COMPANY
Any action by the Company under this Plan shall be made pursuant to
authorization of its Board of Directors.
SECTION 5 DELEGATION OF TRUSTEE'S FUNCTIONS
The Trustee and the Committee may, by agreement in writing, arrange for
the delegation by the Trustee to the Company of any of the functions of the
Trustee, except the custody and distribution of assets, the voting of Common
Stock held by the Trustee, and the purchase and sale or redemption of
securities.
SECTION 6 DUTIES OF THE TRUSTEE
The Trustee shall keep accurate and detailed accounts of all
investments, receipts and disbursements and other transactions.
The Trustee shall annually, following the close of each Plan Year,
revalue and adjust each Participant's Account at its current market value at the
end of the Plan Year.
The Trustee shall furnish at least annually to each Participant a
statement showing the status of his/her Account under the Plan. This statement
shall be deemed to have been accepted as correct unless written notice to the
contrary is received by the Trustee within thirty (30) days after its mailing or
delivery (if distribution is other than by mail) to a Participant.
SECTION 7 ACCOUNTS OF THE TRUSTEE
The annual financial statement of the Plan shall be audited annually by
auditors selected by the Company.
SECTION 8 RECORDS
45
The records of the Trustee, Committee and the Company shall be
conclusive with respect to all matters involved in the administration of this
Plan.
SECTION 9 VOTING OF COMMON STOCK
(a) Each Participant shall have the right to direct the Trustee as
to the manner in which voting rights with respect to shares of
Common Stock held in the Participant's Account shall be
exercised.
(b) In order to implement the voting rights granted in this
Section, the Company shall furnish to the Trustee such
information as will be distributed to shareholders of the
Company in connection with each such vote and a form for the
use by Participants in directing the Trustee as to the manner
in which voting rights shall be exercised (the "Documents"),
in quantities approximately equal to the number of
Participants holding shares of Common Stock in Accounts at the
time of such distribution. The Trustee shall use its best
efforts to distribute or cause to be distributed to each
Participant the Documents as soon as practicable following the
furnishing of the Documents to the Trustee. The Trustee will
follow the written directions of each Participant with respect
to the voting of the shares of Common Stock held in such
Participant's Account, provided that such written directions
are received by the Trustee by the close of business two (2)
days prior to the time such shares must be voted. Any such
written direction by a Participant to the Trustee shall be
effective as of the date such direction is received by the
Trustee. Each Participant shall be permitted to revoke or
change such direction, provided such revocation or change is
received in writing by the Trustee by the close of business
two (2) days prior to the time such shares of Common Stock
must be voted.
(c) In the absence of written direction from a Participant in
accordance with Section 9(b) of this Article, the Trustee
shall vote all shares of Common Stock held in such
Participant's Account in the same manner in which the Trustee
is directed by Participants, pursuant to Section 9(b) of this
Article, to vote the majority of the aggregate shares of
Common Stock held in such Participants' Accounts unless the
Trustee is required, by ERISA, to vote the stock in a
different manner.
(d) The right granted to each Participant pursuant to this Section
9 to direct the manner in which shares of Common Stock
allocated to such Participant's Account are voted, and the
provisions instructing the Trustee regarding the manner in
which voting rights with respect to such shares shall be
exercised in the absence of written directions from a
Participant, shall include the manner in which the rights with
respect to corporate action by shareholder consent is
exercised.
(e) The Designated Beneficiary of each Participant shall be
entitled to receive all distributions of Documents and to
exercise all of the rights granted to each such Participant
pursuant to this Section 9 in the event of the death of such
Participant.
SECTION 10 NOTICES
46
All notices, reports and statements given, made, delivered or
transmitted to a Participant shall be duly given, made, delivered or transmitted
as the Committee may deem appropriate.
All directions, notices and other communications from Participants to
the Committee shall be in such form as may be prescribed by the Committee.
Such written directions, notices and other communications shall be
mailed by first class mail or delivered to the secretary of the Committee and
shall be deemed to have been given when received by the secretary or his/her
duly authorized representative.
SECTION 11 COSTS AND EXPENSES
Except as provided in Article XV Section 3 with respect to transaction
expenses, all costs and expenses incurred in the administration of the Plan
shall be paid by the Company; provided, however, that any taxes which may be
imposed on the income or the assets of the trust shall be paid out of the assets
in the hands of the Trustee and shall be charged ratably against the Accounts of
the Participants. Notwithstanding the foregoing, any taxes incurred by reason of
specific investments or transactions shall be charged against those Accounts of
the Participants which were involved in such investments or transactions on the
basis of the respective interests of such Accounts in the investments or
transactions generating such tax liability.
SECTION 12 MISCELLANEOUS
(a) Construction Of Agreement
The Plan shall be governed by and construed in accordance with
the laws of the State of Ohio, to the extent those laws have
not been superseded by Federal law (which shall otherwise
apply).
(b) Participant's Rights
Participation in the Plan by a Participant shall in no way
affect any of the Company's rights as contained in the Basic
Labor Agreement between the Company and the Union.
(c) Headings
The headings and captions contained in this document are for
convenience of reference only, and are not deemed to
constitute a part of the Plan.
(d) Against Public Policy
Should any provision (or part of any provision) of this Plan
be determined by a court of competent jurisdiction to be
contrary to law or unenforceable as a matter of public policy,
such provision shall be considered severable, and this Plan
shall be considered not to include the provision in issue. The
Plan shall be construed by the Committee, by the Plan
Administrator, and all other persons relying on this document
as though such provision (or part thereof) did not exist, and
the Plan
47
shall be applied and enforced in the manner determined by the
Plan Administrator to be most nearly consistent with the
deleted provision as is permissible under law and public
policy.
(e) Certain Reversions to the Company Permitted
Reversions of contributions to the Company will be permitted
to the extent provided by Section 403(c) of ERISA.
Any contribution made by the Company because of a mistake of
fact must be returned to the Company within one year of the
contribution.
In the event the deduction of a contribution made by the
Company is disallowed under section 404 of the Code, such
contribution (to the extent disallowed) must be returned to
the Company within one year of the disallowance of the
deduction.
In the event that the Commissioner of Internal Revenue
determines that the plan is not initially qualified under the
Internal Revenue Code, any contribution made incident to that
initial qualification by the Company must be returned to the
Company within one year after the date the initial
qualification is denied, but only if the application for the
qualification is made by the time prescribed by law for filing
the Company's return for the taxable year in which the plan is
adopted, or such later date as the Secretary of the Treasury
may prescribe.
(f) Payment to Minor or Incompetent Person
In the event that any benefit payable under this Plan is
payable to or for the benefit of a minor, an incompetent
person, or other person incapable of receipting therefor, such
benefit shall be deemed paid when paid to such person's
guardian or to the party providing or reasonably appearing to
provide for the care of such person, and such payment shall
fully discharge the Trustee, the Plan Administrator, the
Company and all other parties with respect thereto.
(g) Forfeiture if Participant or Designated Beneficiary Cannot Be
Located
In the event that any benefit payable under this Plan to any
Participant or Designated Beneficiary cannot be paid because
the proper payee cannot be located or identified by the
Trustee, such benefit shall be deemed forfeited thirty-six
(36) months from the date on which the Trustee or Plan
Administrator first attempted to locate such payee, provided,
however, that upon presentation by such proper payee of a
subsequent claim for such forfeited benefit, the full amount
of the forfeited benefit shall be restored.
(h) Merger or Consolidation
In the event of the merger or consolidation of this Plan (or
any part thereof) into any other plan, or the transfer to or
from this Plan of any of the assets held for the benefit of
Participants and Designated Beneficiaries, each Participant
and
48
Designated Beneficiary affected by such merger, consolidation
or transfer shall have an accrued benefit in the surviving or
transferee plan (determined as if such plan were then
terminated immediately after such merger, consolidation or
transfer) that is equal to or greater than his/her accrued
benefit to which he/she would have been entitled, had the Plan
been terminated immediately prior to the occurrence of such
merger, consolidation or transfer.
(i) Electronic Media
Notwithstanding any provision of the Plan to the contrary,
including any provision which requires the use of a written
instrument, to the extent permitted by applicable law, the
Committee may establish procedures for the use of electronic
media in communications and transactions between the Plan or
the Committee and Participants and Beneficiaries. Electronic
media may include, but are not limited to, e-mail, the
Internet, intranet systems and automated telephonic response
systems.
(j) Plan Conversions
Notwithstanding any provision of the Plan to the contrary,
during any conversion period, in accordance with procedures
established by the Committee, the Committee may temporarily
suspend, in whole or in part, certain provisions of the Plan,
which may include, but are not limited to, a Participant's
right to change his contribution election, a Participant's
right to change his investment election and a Participant's
right to borrow or withdraw from his Account or obtain a
distribution from his Account.
SECTION 13 DESIGNATION OF TRUSTEE
In order to implement the Plan, the Company will enter into a trust
agreement with the Trustee to the end that contributions of the Participants and
the contributions of the Company shall be invested in accordance with the
provisions of this Plan and shall be held in Trust for the exclusive benefit of
the Participants or their Designated Beneficiaries.
The Company may, without further reference to or action by any
Participant, from time to time, enter into such further agreements with the
Trustee or other parties and make such amendments to said trust agreements or
said further agreements as it may be necessary or desirable to carry out the
Plan, may from time to time designate a successor Trustee or successor Trustees,
or may take such other steps to execute such other instruments as it may deem
necessary or desirable to put the Plan into effect or to carry out the
provisions thereof.
SECTION 14 TENDER AND EXCHANGE OFFERS
Notwithstanding any other provision contained herein to the contrary
(including, without limitation, the provisions of ARTICLE XIII), in the event
the Trustee receives (i) any tender offer which is subject to Section 14(d)(1)
of the Securities Exchange Act of 1934, as amended from time to time, and to
regulations promulgated thereunder, or (ii) any other offer or option to
49
buy or exchange more than thirty (30) percent of the outstanding shares of
Common Stock, the provisions of this Section 14 of ARTICLE XIV shall apply.
(a) Each Participant shall have the right to direct the Trustee as
to whether to tender and sell or exchange pursuant to such
offer any whole and fractional shares of Common Stock held in
the Participant's Account.
(b) In order to implement the rights granted in this Section 14 of
ARTICLE XIV, the Company shall furnish to the Trustee such
information as may be distributed by it to shareholders of the
Company in connection with each such offer (the "Tender
Document"), in quantities approximately equal to the number of
Participants holding shares of Common Stock in Accounts at the
time of such distribution. The Trustee shall use its best
efforts to distribute or cause to be distributed to each
Participant the Tender Documents together with all other
materials that the Trustee receives as a shareholder from any
other party with respect to such offer (the "Additional Tender
Documents") and a form prepared by the Trustee for the use by
Participants in directing the Trustee as to whether or not
shares of Common Stock in the Participants' Accounts shall be
tendered and sold or exchanged as soon as practicable
following the furnishing of the Tender Documents and
Additional Tender Documents to the Trustee. The Trustee will
follow the written directions of each Participant with respect
to the tender, and sale or exchange if the tender is accepted,
of the whole and fractional shares of Common Stock held in
such Participant's Account, provided that such written
directions are received by the Trustee by the close of
business two (2) days prior to the time such shares must be
tendered. Any such written direction by a Participant to the
Trustee shall be effective as of the date such direction is
received by the Trustee. Each Participant shall be permitted
to revoke or change such direction, provided such revocation
or change is received in writing by the Trustee by the close
of business two (2) days prior to the time such shares of
Common Stock must be tendered. The Trustee shall tender all
shares of Common Stock as to which valid and timely directions
to do so have been received by it and have not been
subsequently timely revoked prior to the expiration date of
the offer to which the directions relate, and, to the extent
the tender is accepted, the shares so tendered shall be sold
or exchanged as soon as practical thereafter. Each Participant
may direct the Trustee to withdraw any shares of Common Stock
in the Participant's Account which were previously tendered,
and the Trustee shall withdraw such shares of Common Stock
prior to the withdrawal date of the offer, provided such
direction is received in writing by the Trustee by the close
of business two (2) days prior to the withdrawal date of the
offer. Any and all directions given to the Trustee by any
Participant pursuant to this Section 14 of ARTICLE XIV shall
remain in the strict confidence of the Trustee.
(c) In the absence of written direction from a Participant in
accordance with Section 14(b) of ARTICLE XIV, the Trustee
shall tender, and sell or exchange in the event the tender is
accepted, at the times provided in Section 14(b) of ARTICLE
XIV, all whole and fractional shares of Common Stock held in
such Participant's Account only if the Trustee is directed by
Participant, pursuant to Section 14(b) of
50
ARTICLE XIV, to tender and sell or exchange the majority of
the aggregate shares of Common Stock held in such
Participants' Accounts.
(d) The Designated Beneficiary of each Participant shall be
entitled to receive all distributions of Tender Documents and
Additional Tender Documents and to exercise all of the rights
granted to each such Participant pursuant to this Section 14
of ARTICLE XIV in the event of the death of such Participant.
(e) The price at which sales of the Company's Common Stock in
accordance with this Section 14 of ARTICLE XIV pursuant to a
tender or exchange offer described herein shall be credited to
the Participants' Accounts shall be the price paid in
connection with the tender or exchange offer. Shares of Common
Stock sold in accordance with this Section 14 of ARTICLE XIV
pursuant to a tender of exchange offer described herein shall
not be considered in computing weighted average price under
Section 2 of ARTICLE XV. The cash proceeds from the sale or
exchange of any shares of Common Stock tendered and sold or
exchanged pursuant to this Section 14 of ARTICLE XIV shall be
invested in accordance with the terms of the Plan. If, as a
result of a tender and sale or exchange, the Trustee receives
securities or other property, such securities or property
shall be held or reinvested in accordance with the terms of
the Plan. Any shares of Common Stock tendered or offered but
not purchased or exchanged shall be held or reinvested by the
Trustee in the trust created under this Plan in accordance
with the terms of the Plan.
(f) Transactions in the Company's Common Stock pursuant to a
tender or exchange offer in accordance with this Section 14 of
ARTICLE XIV need not be made through the facilities of the New
York Stock Exchange.
(g) The Account of each Participant for whom the Trustee has sold
or exchanged shares of Common Stock in connection with any
tender offer or exchange offer described in this Section 14 of
ARTICLE XIV shall be charged with a pro rata share of all
expenses incurred by the Trustee in all sales or exchanges
pursuant to such offer.
51
ARTICLE XV
SECURITIES TRANSACTIONS BY TRUSTEE
SECTION 1 TRANSACTION PERIOD
For convenience in administration, the Committee and the Trustee shall
establish a period for (a) the purchase and sale of Mutual Fund shares or the
Company's Common Stock or (b) the deposit and withdrawal of Cash With Interest,
which shall be known as a Transaction Period. The Transaction Period shall
commence at 4:00 p.m. Eastern Time on a day when both the Trustee and the New
York Stock Exchange are open for business and shall end at 4:00 p.m. Eastern
Time on the next succeeding day when both the Trustee and the New York Stock
Exchange are open for business. All purchases and sales of the Company's Common
Stock or Mutual Fund shares or the deposit and withdrawal of Cash With Interest
made by the Trustee during the Transaction Period shall be in accordance with
the instructions and directions of the Participants (or of the Company as to
purchases of the Company's Common Stock with amounts to be credited to a
Participant's Account from Company Contributions attributable to Participant's
Contributions) which are received during a Transaction Period. The Trustee shall
not be required to respond to any subsequent instruction or direction received
during any Transaction Period until the next succeeding Transaction Period.
SECTION 2 POOLED ACCOUNT FOR SECURITIES TRANSACTIONS
The transaction price for purchases and sales of Company's Common Stock
shall be determined based upon the closing price of the Company's Common Stock
on the New York Stock Exchange on a day when both the Trustee and the New York
Stock Exchange are open for business, times the total number of shares of the
Company's Common Stock in the Common Stock pooled account, plus uninvested cash
and accrued income, divided by the number of shares in the Common Stock pooled
account.
The transaction price for purchases and sales in each of the Mutual
Funds shall be determined based upon the closing price of each such Mutual Funds
on a day when both the Trustee and the New York Stock Exchange are open for
business, times the total number of shares in each such Mutual Funds pooled
account, plus uninvested cash and accrued income; divided by the total number of
shares of each such Mutual Funds pooled account.
Purchases and sales of the Cash With Interest Investment Option shall
be charged or credited on the basis of actual purchase and sale prices for the
particular transaction.
SECTION 3 ALLOCATING TRANSACTION EXPENSE
Each Participant for whom the Trustee has sold and/or purchased shares
in one or more of the Investment Options available in the Plan pursuant to the
Participant's specific investment directions shall be charged for the expenses
incurred by the Plan in the exercise of the Participant's specific investment
option direction.
SECTION 4 REGISTRATION OF SECURITIES
52
Securities held by the Trustee may be registered in the name of the
Trustee or its nominee.
SECTION 5 MISCELLANEOUS
The Trustee shall invest in the Company's Common Stock Investment
Option, the Cash With Interest Investment Option, or Mutual Fund Investment
Option as promptly as practicable after the receipt of Employee contributions.
Contributions temporarily held for investment in one of the Investment Options
shall be invested by the Trustee in a short term fund approved by the Committee.
All Transactions in the Company's Common Stock shall be made through the
facilities of the New York Stock Exchange except for the purchase of stock from
the Company as provided in Section 4 of Article V.
53
ARTICLE XVI
ASSIGNABILITY
It is a condition of the Plan, and all rights of each Participant shall
be subject thereto, that, except as provided in a qualified domestic relations
order as defined in Section 414(p) of the Code, no right or interest of any
Participant in the Plan or in the Account shall be assignable or transferable in
whole or in part, either directly or by operation of law or otherwise,
including, but not by the way of limitation, execution, levy, garnishment,
attachment, pledge, bankruptcy or in any other manner, but excluding the
consequence of death, or mental incompetency, and no right of interest of any
Participant of the Plan or in the Account shall be liable for, or subject to,
any obligation or liability of such Participant. Notwithstanding any provision
of the Plan to the contrary, effective for judgments, orders, decrees or
settlements issued on or after August 5, 1997, the Plan shall honor a judgment,
order, decree or settlement providing for the offset of all or a part of a
Participant's benefit under the Plan, to the extent permitted under Code Section
401(a)(13)(C); provided that the requirements of Code Section 401(a)(13)(C)(iii)
relating to the protection of the Participant's spouse (if any) are satisfied.
54
ARTICLE XVII
AMENDMENT, MODIFICATION, SUSPENSION OR TERMINATION OF THE PLAN
SECTION 1 AMENDMENT
Subject to Section 2 of this Article XVII, the Company may at any time
and from time to time, amend the Plan if in the opinion of the Company such
amendment is necessary to enable the Plan to meet the requirements of the Code
(including the regulations and rulings issued thereunder) or the requirements of
any governmental authority.
SECTION 2 LIMITATION ON AMENDMENT
The Company shall make no amendment to the Plan which shall result in
the forfeiture or reduction of the interest of any Employee, Participant, former
Participant or person claiming under or through any one or more of them pursuant
to the Plan, except that nothing herein contained shall restrict the right to
amend the provisions hereof relating to the administration of the Plan.
Moreover, no such amendment shall be made hereunder which shall permit any part
of Participants' contributions to revert to any Company or be used or be
diverted to purposes other than the exclusive benefit of Employees,
Participants, former Participants, and beneficiaries.
SECTION 3 TERMINATION
This Plan shall continue in effect until and including the 31st day of
July, 2004. Thereafter it shall renew itself for yearly periods unless written
notice is given by either party to the other not less than sixty (60) days, but
not more than seventy-five (75) days, prior to the expiration date or any
extension thereof, that it is desired to terminate or amend the Plan. In the
event such notice is given, the parties shall begin negotiations not less than
forty-two (42) days prior to the termination date, unless otherwise mutually
agreed to. If negotiations are not completed prior to the expiration date, this
Plan shall terminate unless extended by mutual agreement of the parties. Upon
termination, this Plan shall terminate in all respects, except that no
distributions shall be made from the Plan until ninety (90) days following such
termination, and any distributions made upon termination of the Plan shall be
subject to the terms of Article XI Section 3. Except as herein otherwise
provided, no provision of this Plan shall be subject to change prior to the
expiration date as determined above.
Upon any termination or partial termination of the Plan, the rights of
each Participant to the assets then held in his/her Account under the Plan shall
be non-forfeitable.
55
ARTICLE XVIII - ESOP FEATURE
SECTION 1 ESTABLISHMENT OF ESOP
(a) The provisions of this Article XVIII shall become effective
January 1, 2002.
(b) The Plan shall consist of two components, the ESOP Feature and
the Non-ESOP Feature. The ESOP Feature shall consist of the
ESOP Account. The ESOP Feature is intended to qualify as a
stock bonus plan under Code Section 401(a) and as an employee
stock ownership plan under Code Section 4975(e)(7). The ESOP
Feature is designed to invest primarily in "qualifying
employer securities," as defined in Code Sections 4975(e)(8)
and 409(l) and ERISA Section 407(d)(5). The ESOP Feature is
described in this Article XVIII. The provisions of this
Article XVIII shall supercede any contrary provisions of the
Plan.
SECTION 2 ESOP ACCOUNT
(a) The Committee shall establish an ESOP Account in the name of
each Participant and shall thereafter maintain a record
thereof.
(b) The ESOP Account of each Participant shall be credited and
debited periodically during each Plan Year in which the ESOP
is maintained with any additions or reductions in the number
of shares of Common Stock held for such Participant in the
Plan due to the reallocation of the investment of the
Participant's Non-ESOP Account and ESOP Account, and with any
stock and cash dividends paid on Common Stock attributable to
units of the Common Stock fund.
(c) In the event that a Participant elects a partial liquidation
of the investment of his Account in Common Stock pursuant to
Section 5 of Article V, Common Stock shall be liquidated
pro-rata from the Participant's Non-ESOP Account and ESOP
Account.
SECTION 3 ESOP CONTRIBUTIONS
The Company, in its discretion, may make ESOP Contributions from time
to time in such amounts as are determined by the Company. All ESOP Contributions
shall be made in Common Stock. ESOP Contributions for a Plan Year shall be
allocated among active Participants for the Plan Year. The amount allocated to
each active Participant shall be determined by multiplying each active
Participant's Compensation for such Plan Year by a fraction, the numerator of
which is the ESOP Contribution for such Plan Year, and the denominator of which
is the total Compensation of all active Participants for such Plan Year. ESOP
Contributions shall be treated as Company Contributions for purposes of
distributions and withdrawals from the Plan. The ESOP Contribution subaccount of
a Participant shall be invested in Common Stock, subject to the diversification
rules provided in Section 4 of this Article.
SECTION 4 DIVERSIFICATION OF INVESTMENT
56
Participants who are at least age 55 may diversify the investment of
amounts, including amounts not Vested, held in their ESOP Accounts by
transferring amounts out of the Common Stock fund to one of the other Investment
Options in accordance with the provisions of Section 5 of Article V. Any
transfer of such amounts out of the Common Stock fund to another Investment
Option shall be deemed to be a transfer from the ESOP Feature to the Non-ESOP
Feature.
SECTION 5 PUT OPTION
(a) If shares of Common Stock distributable to a Participant or
his Beneficiary are at the time of the distribution not
readily tradable on an established market, the Participant or
Beneficiary will have an option (the "Put") to require the
Company to purchase all of the shares actually distributed to
him. The Put may be exercised at any time during the Option
Period (as defined below) by giving the Company written notice
of the election to exercise the Put. The Put may be exercised
by a former Participant or the Beneficiary only during the
Option Period in which the former Participant or Beneficiary
receives a distribution of shares of Common Stock.
(b) The "Option Period" is the 60-day period following the day on
which a Participant or his Beneficiary receives a
distribution. If the former Participant or Beneficiary does
not exercise the Put during that 60-day period, the Option
Period will also be the 60-day period beginning after the new
determination of the fair market value of Common Stock by the
Committee (and notice to the Participant) in the following
Plan Year. The Option Period will be extended by the amount of
time during which the Company is unable to honor the Put by
reason of applicable federal or state law.
(c) The "Option Price" will be the fair market value of each share
of Common Stock as of the valuation date immediately preceding
the date the Put is exercised, multiplied by the number of
shares to be sold under the Put, with appropriate adjustments
to reflect intervening stock dividends, stock splits, stock
redemptions, or similar changes to the number of outstanding
shares.
(d) The terms of payment for the sale of Common Stock pursuant to
the Put shall be as provided in the Put and may be either paid
in a lump sum or in installments as provided by the Committee.
An agreement to pay through installments shall be permissible
only if the Common Stock subject to the put option is part of
a 'total distribution,' as defined in Code Section 409(h)(5),
and--
(i) the agreement is adequately secured, as determined by
the Committee,
(ii) a reasonable rate of interest is charged, as
determined by the Committee,
(iii) annual payments are equal,
(iv) installment payments must begin not later than 30
days after the date the Put option is exercised, and
57
(v) the term of the payment does not extend beyond five
years from the date the Put option is exercised.
(e) The Put will not be assignable, except that the former
Participant's donees or, in the event of a Participant's
death, his personal representative, will be entitled to
exercise the Put during the Option Period for which it is
applicable.
(f) The Trustee in its discretion may, with the Company's consent,
assume the Company's obligation under this Section at the time
a former Participant or Beneficiary exercises the Put. If the
Trustee does assume the Company's obligations, the provisions
of this Section that apply to the Company will also apply to
the Trustee.
(g) The Put will also apply to shares of Common Stock that are
publicly traded without restriction when distributed but which
cease to be publicly traded or which become subject to a
trading limitation during the Option Period. In that event,
the Committee will notify in writing each former Participant
or Beneficiary to whom the Put becomes applicable that the
shares of Common Stock held by the former Participant or
Beneficiary are subject to the Put for the remainder of the
applicable Option Period and will inform the Participant or
Beneficiary of the terms of the Put. If the written notice is
given later than ten days after the shares of Common Stock
cease to be publicly traded or become subject to a trading
limitation, the period during which the Put may be exercised
will be extended by the number of days between the tenth day
and the date the notice is actually given.
(h) The Committee will notify each former Participant or
Beneficiary who is eligible to exercise the Put of the fair
market value of each share of Common Stock as soon as
practicable following its determination. The Committee and the
Company will send all notices required under this Subsection
to the last known address of a former Participant or
Beneficiary, and it will be the duty of those persons to
inform the Committee of any changes in address.
SECTION 6 PAYMENT OF DIVIDENDS
(a) The Committee, in its sole discretion, may provide that any
dividends paid in cash during the Plan Year on shares of
Common Stock in which Participants' ESOP Accounts are invested
shall be (i) paid in cash directly to the Participant, (ii)
paid to the Plan and subsequently distributed to the
Participant in cash no later than 90 days after the close of
the Plan Year in which the dividends are paid to the Plan, or
(iii) at the election of the Participant, either (A) paid to
the Participant as provided in Clause (i) or (ii) (as
determined by the Committee) or (B) paid to the Participant's
ESOP Account to be reinvested in the Common Stock. Such
dividends shall be paid in accordance with procedures
established by the Committee.
(b) If an election pursuant to Paragraph (a)(iii) is provided by
the Committee, each Participant may make the election, in the
manner and at the time specified by the
58
Committee, with respect to dividends received on shares of
Common Stock comprising the portion of the Common Stock fund
allocated to the Participant's ESOP Account. If an election
pursuant to Paragraph (a)(iii) is provided by the Committee
and a Participant does not make such an election, such
dividends shall be paid to the Participant's ESOP Account to
be reinvested in Common Stock.
(c) The Beneficiary of a deceased participant shall have the same
rights as a Participant has under this Section 6.
(d) The provisions of this Section 6 are intended to comply with
Section 404(k) of the Code, and shall be interpreted and
construed accordingly.
SECTION 7 INDEPENDENT APPRAISER
Common Stock held in Participants' ESOP Accounts shall be valued as of
each valuation date, or at the discretion of the Committee, more frequently. All
valuations of Common Stock held in Participants' ESOP Accounts which is not
readily tradable on an established securities market shall be made by an
independent appraiser meeting requirements similar to those contained in
Treasury Regulations under Code Section 170(a)(1).
SECTION 8 SHARE LEGEND
Shares of Common Stock in the ESOP Feature held or distributed by the
Trustee may include such legend restrictions on transferability as the Company
may reasonably require in order to assure compliance with applicable federal and
state securities laws.
59
IN WITNESS WHEREOF, the Cooper Tire & Rubber Company has caused this
Restated Plan to be executed and adopted this 26th day of February, 2002.
COOPER TIRE & RUBBER COMPANY
By:/s/ Stephen O. Schroeder
-----------------------------------------
Treasurer
By:/s/ Richard N. Jacobson
-----------------------------------------
Assistant Secretary
60
AMENDMENT NO. 1 TO THE
COOPER TIRE & RUBBER COMPANY
PRE-TAX SAVINGS PLAN (BOWLING GREEN-SEAL)
(AS AMENDED AND RESTATED EFFECTIVE AS OF JANUARY 1, 2001)
The Cooper Tire & Rubber Company (the "Company") hereby adopts
this Amendment No. 1 to the Cooper Tire & Rubber Company Pre-Tax Savings Plan
(Bowling Green-Seal) (As Amended and Restated Effective as of January 1, 2001)
(the "Plan"). The provisions of this Amendment shall be effective as of January
1, 2002, unless otherwise indicated. Words and phrases used herein with initial
capital letters which are defined in the Plan are used herein as so defined.
One of the purposes of this Amendment is to reflect the
adoption of various provisions of the Economic Growth and Tax Relief
Reconciliation Act of 2001 ("EGTRRA"). The Company intends for this Amendment to
satisfy the "good faith" compliance requirements of EGTRRA and to be construed
in accordance with EGTRRA and guidance issued thereunder.
SECTION 1
Section (12) of Article I of the Plan is hereby amended in its
entirety to read as follows:
"(12) 'Compensation' - includes all payments of wages, bonus,
Company Wage Reduction Contributions to this Plan and any
taxable payments paid to the Participant in a calendar year,
except that there shall be excluded from Compensation:
supplemental unemployment benefits, supplemental worker's
compensation, accident and sickness benefits, and other
amounts which either are excludable or deductible from income
in whole or in part for federal income tax purposes or which
represent payments pursuant to a program of benefits or
deferred compensation (other than Company Wage Reduction
Contributions), whether or not qualified under the Code.
Notwithstanding the above, the maximum amount of compensation
taken into account each year for all computations shall not
exceed the amount prescribed pursuant to Section 401(a)(17) of
the Code, as amended, or such amount as the Secretary of the
Treasury shall prescribe from time to time."
SECTION 2
Section 1(a)(ii) of Article III of the Plan is hereby amended
in it entirety to read as follows:
"(ii) the dollar limitation contained in Section 402(g) of the
Code in effect for such taxable year."
SECTION 3
61
Section 1 of Article IV of the Plan is hereby amended by (i)
deleting the fifth paragraph therein and (ii) deleting the word "either" and the
phrase "or multiple use rules" in the sixth paragraph where they occur therein.
SECTION 4
Section 1(a) of Article IX of the Plan is hereby amended in
its entirety to read as follows:
"the Participant's retirement, death, Total and Permanent
Disability, or severance from employment;"
SECTION 5
Section 1 of Article IX of the Plan is hereby amended by (i)
deleting subsections (d) and (e) and (ii) renumbering subsection (f) as
subsection (d).
SECTION 6
The last paragraph of Section 2 of Article IX of the Plan is
hereby amended in its entirety to read as follows:
"Employees who make a hardship withdrawal may not
make elective deferrals and employee after-tax contributions
under this Plan and all other plans of the Company for 6
months after receipt of the distribution."
SECTION 7
Section 6(d)(i)(A) of Article XI of the Plan is hereby amended
in its entirety to read as follows:
"(A) Eligible Rollover Distribution: An Eligible Rollover
Distribution is any distribution of all or any portion of the
balance to the credit of the Distributee except that an
Eligible Rollover Distribution does not include any
distribution to the extent such distribution is required under
section 401(a)(9) of the Code, any distribution that is one of
a series of substantially equal periodic payments (paid not
less frequently than annually) over the life (or life
expectancy) of the distributee or the joint lives (or life
expectancies) of the distributee and a designated beneficiary
or for a specified period of ten years or more, the portion of
any distribution that is not includible in gross income
(determined without regard to the exclusion for net unrealized
appreciation with respect to employer securities), such other
amounts specified in Treasury regulations and rulings, notices
or announcements issued under Section 402(c) of the Code, and
any distribution which is made upon hardship the distributee.
Notwithstanding the foregoing, a portion of a distribution
shall not fail to be an Eligible Rollover
62
Distribution merely because the portion consists of after-tax
employee contributions which are not includible in gross
income. However, such portion may be transferred only to an
individual retirement account or annuity described in Section
408(a) or (b) of the Code, or to a qualified defined
contribution plan described in Sections 401(a) or 403(a) of
the Code that agrees to separately account for amounts so
transferred, including separately accounting for the portion
of such distribution which is includible in gross income and
the portion of such distribution which is not so includible."
SECTION 8
Section 6(d)(i)(B) of Article XI of the Plan is hereby amended
in its entirety to read as follows:
"(B) Eligible Retirement Plan: An Eligible Retirement Plan
is an individual retirement account described in Section
408(a) of the Code, an individual retirement annuity described
in Section 408(b) of the Code, an annuity plan described in
Section 403(a) of the Code, a qualified trust described in
Section 401(a) of the Code, an annuity contract described in
Section 403(b) of the Code, or an eligible plan under Section
457(b) of the Code which is maintained by a state, political
subdivision of a state, or any agency or instrumentality of a
state or political subdivision of a state that accepts the
Distributee's Eligible Rollover Distribution."
SECTION 9
The first two sentences of Section 1(a) of Article XII of the
Plan are hereby amended in their entirety to read as follows:
"(a) MAXIMUM ANNUAL ADDITION: The "annual addition" to a
Participant's Account shall not exceed the lesser of (i)
$40,000, as adjusted for increases in the cost-of-living under
Section 415(d) of the Code or (ii) 100% of the Participant's
Compensation (as defined in paragraph (d) below) for that Plan
Year. The Compensation limit referred to in (ii) shall not
apply to any contribution for medical benefits after
separation from service (within the meaning of Section 401(h)
or Section 419A(f)(2) of the Code) which is otherwise treated
as an annual addition."
63
SECTION 10
Section 3(f) of Article XIV of the Plan is hereby amended in
its entirety to read as follows:
"(f) Claims for Benefits (other than disability benefits)
Any Participant or Designated Beneficiary who
believes that he or she is entitled to receive a
benefit under the Plan which he or she has not
received may file with the designated representative
of the Committee, on such forms as may be designated
by the Committee, a written claim specifying the
basis for his or her claim and the facts upon which
he or she relies in making such claim. Such a claim
must be signed by the claimant or his or her
authorized representative and shall be deemed filed
when delivered to the designated representative of
the Committee.
Unless such claim is allowed in full by the
Committee, the Committee shall (within 90 days after
such claim was filed, plus an additional period of 90
days if required for processing and if notice of the
90-day extension of time indicating the specific
circumstances requiring the extension and the date by
which a decision shall be rendered is given to the
claimant within the first 90-day period) cause
written notice to be mailed to the claimant of the
total or partial denial of such claim. Such notice
shall be written in a manner calculated to be
understood by the claimant and shall state
(i) the specific reason(s) for the denial of the
claim,
(ii) specific reference(s) to pertinent
provisions of the Plan and/or Trust Fund on
which the denial of the claim was based,
(iii) a description of any additional material or
information necessary for the claimant to
perfect the claim and an explanation of why
such material or information is necessary,
and
(iv) an explanation of the review procedure
specified in Section 3(g) of this Article
XIV."
64
SECTION 11
Section 3(g) of Article XIV of the Plan is hereby amended in
its entirety to read as follows:
"(g) Appeals Procedure
Within 90 days after the denial of his or her claim,
the claimant may appeal such denial by filing with
the Plan Administrator his or her written request for
a review of the claim. Such request for review must
be signed by the claimant or his or her authorized
representative and shall be deemed filed when
delivered to the Plan Administrator or its designee.
If the claimant does not file a request for review of
his or her claim within such 90-day period, the
claimant shall be conclusively presumed to have
accepted as final and binding the initial decision of
the Plan Administrator on his or her claim. In
considering any appeal pursuant to this Section 3(g),
the Plan Administrator shall have the same powers to
interpret the Plan and make factual findings with
respect thereto as are granted to the Committee under
Section 2 hereof.
If such an appeal is so filed within such 90-day
period then the Plan Administrator, or a named
fiduciary designated by the Administrator, shall
conduct a full and fair review of such claim. During
such full review, the claimant shall be provided with
the opportunity to submit written comments,
documents, records, and other information relating to
the claim for benefits, and with reasonable access to
and copies of, upon request and free of charge, all
documents, records, and other information relevant to
the claimant's claim for benefits. In addition, such
full and fair review shall take into account all
comments, documents, records, and other information
submitted by the claimant relating to the claim,
without regard to whether such information was
submitted or considered in the initial benefit
determination.
After the completion of such full review, the
reviewer shall mail or deliver to the claimant a
written decision on the matter based on the facts and
pertinent provisions of the Plan and/or Trust Fund
and/or applicable law. Such decision shall be mailed
or delivered to the claimant within a period of 60
days after the Administrator's receipt of the request
for review unless special circumstances require an
extension of time, in which case such decision shall
be rendered not later than 120 days after receipt of
such request. (If an extension of time for review is
required, written notice of the extension shall be
furnished to the claimant prior to the commencement
of the extension.) Such decision (1) shall be written
in a manner calculated to be understood by the
claimant, (2) shall state the specific reason(s) for
the decision, (3) shall make specific reference(s) to
65
pertinent provisions of the Plan and/or Trust Fund on
which the decision is based and (4) shall, to the
extent permitted by applicable law, be final and
binding on all interested persons. The notice of the
adverse determination shall also include a statement
that the claimant is entitled to receive, upon
request, and free of charge, reasonable access to,
and copies of, all documents, records, and other
information relevant to the claimant's claim for
benefits, and contain a statement describing any
voluntary appeal procedures offered by the Plan and
the claimant's right to obtain information about such
procedures and a statement of the claimant's right to
bring an action under Section 502(a) of ERISA."
SECTION 12
Section 3 of Article XIV of the Plan is hereby amended by
adding a new subsection (h) to the end thereof, immediately following subsection
(g), to read as follows:
"(h) Claims for Benefits Upon Total and Permanent
Disability:
(1) Notwithstanding the foregoing provisions
of this Article, in the case of a claim for benefits
upon Total and Permanent Disability, unless such
claim is allowed in full by the Committee, the
Committee shall (within a reasonable period of time,
but not later than 45 days, unless such period is
extended as provided in Section 3(h)(2), below, after
receipt of the claim) cause written notice to be
mailed or delivered to the claimant of the total or
partial denial if his claim. Such notice shall be
written in a manner calculated to be understood by
the claimant and shall include
(i) the specific reason(s) for the
denial of the claim,
(ii) specific reference(s) to the
provisions of the Plan and/or Trust
Fund on which the denial of the
claim was based,
(iii) a description of any additional
material or information necessary
for the claimant to perfect the
claim and an explanation of why
such material or information is
necessary,
66
(iv) an explanation of the review
procedures specified in Section
3(h)(3) of this Article XIV and the
time limits applicable to such
procedures, and
(v) a specific reference to the
internal rule, guideline, protocol
or other similar criterion, if any,
that was relied upon in making the
adverse determination or a
statement that such rule,
guideline, protocol, or other
similar criterion, if any, was
relied upon in making the adverse
determination and that a copy of
such rule, guideline, protocol, or
other similar criterion will be
provided free of charge to the
claimant upon request.
(2) The 45-day period set forth in Section
3(h)(1), above, may be extended by the Committee for
up to 30 days, provided that the Committee determines
that such an extension is necessary due to matters
beyond the control of the Committee and notifies the
claimant, prior to the expiration of the initial
45-day period, of the circumstances requiring the
extension of time and the date by which the Committee
expects to render a decision. Additionally, if, prior
to the end of the first 30-day extension period, the
Committee determines that, due to matters beyond the
control of the Committee, a decision cannot be
rendered within that extension period, the period for
making the determination may be extended for up to an
additional 30 days, provided that the Committee
notifies the claimant, prior to the expiration of the
first 30-day extension period, of the circumstances
requiring the extension and the date as of which the
Committee expects to render a decision. In the event
of any extension under this Section 3(h)(2), the
notice of extension shall specifically explain the
standards on which entitlement to a benefit is based,
the unresolved issues that prevent a decision on the
claim, and the additional information needed to
resolve the issues. The claimant shall be afforded at
least 45 days within which to provide the specified
information. Additionally, in the event that a period
of time is extended due to a claimant's failure to
submit information necessary to decide a claim, the
period for making the benefit determination shall be
tolled from the date on which the notification of the
extension is sent to the claimant until the date on
which the claimant responds to the request for
additional information.
(3) Within 180 days after receipt of a notification
of a denial of a claim, the claimant or his duly
authorized representative may appeal such denial
67
by filing with the Committee his written request for
a review of his claim. If such an appeal is so filed
within 180 days, a Named Fiduciary designated by the
Committee shall conduct a full and fair review of
such claim. During such full and fair review, the
claimant shall be provided with the opportunity to
submit written comments, documents, records, and
other information relating to the claim for benefits
and reasonable access to and copies of, upon request
and free of charge, all documents, records, and other
information relevant to the claimant's claim for
benefits. In addition, such full and fair review
shall (i) take into account all comments, documents,
records, and other information submitted by the
claimant relating to the claim, without regard to
whether such information was submitted or considered
in the initial benefit determination, (ii) not afford
deference to the initial adverse benefit
determination, (iii) be conducted by a Named
Fiduciary who is neither the individual who made the
adverse benefit determination that is the subject of
the appeal, nor the subordinate of such individual,
(iv) provide that, in deciding any appeal of any
adverse benefit determination that is based in whole
or in part on a medical judgment, the Named Fiduciary
shall consult with a health care professional who has
appropriate training and experience in the field of
medicine involved in the medical judgment and who is
neither the individual who was consulted in
connection with the adverse benefit determination
that is the subject of the appeal, nor the
subordinate of any such individual, and (v) provide
for the identification of medical or vocational
experts whose advice was obtained on behalf of the
Plan in connection with the claimant's adverse
benefit determination, without regard to whether the
advice was relied upon in making the initial benefit
determination.
The decision of the Named Fiduciary shall be made in
a writing delivered to the claimant within a
reasonable time, but in no event later than 45 days
after the receipt of the request for review unless
special circumstances require an extension of time
for processing. If the Named Fiduciary determines
that an extension of time for processing is required,
written notice of the extension shall be furnished to
the claimant setting forth the special circumstances
requiring an extension of time and the date by which
the Named Fiduciary expects to render a decision on
review, and shall be furnished prior to the
termination of the initial 45-day period. In no event
shall such extension exceed a period of 45 days from
the end of the initial 45-day period.
In the case of an adverse benefit determination on
review, the notice of the determination shall be
written in a manner calculated to be understood by
the claimant and shall include (i) the specific
reasons for the determination, (ii) specific
reference(s) to specific provisions of the Plan
and/or Trust Fund on which the determination is
based, (iii) a statement that the claimant is
entitled to receive, upon request, and free of
charge,
68
reasonable access to, and copies of all documents,
records, and other information relevant to the
claimant's claim for benefits, (iv) a statement
describing any voluntary appeal procedures offered by
the Plan and the claimant's right to obtain
information about such procedures, including a
statement of the claimant's right to bring a civil
action under section 502(a) of ERISA and (v) if an
internal rule, guideline, protocol or other similar
criterion was relied upon in making the adverse
determination, either the specific rule, guideline,
protocol, or other similar criterion, or a statement
that such rule, guideline, protocol, or other similar
criterion was relied upon in making the adverse
determination and that a copy of the rule, guideline,
protocol or other similar criterion will be provided
free of charge to the claimant upon request. To the
extent permitted by applicable law, the determination
on review shall be final and binding on all
interested persons. In performing the duties under
this Section 3(h)(3), the Named Fiduciary shall have
the same powers to interpret the Plan and make
factual findings with respect thereto as are granted
to the Committee under Section 2 hereof."
EXECUTED this 27th day of December 2002.
THE COOPER TIRE & RUBBER COMPANY
By:/s/ Stephen O. Schroeder
----------------------------
Treasurer
By:/s/ Charles F. Nagy
----------------------------
Assistant Treasurer
69