COLUMBUS McKINNON CORPORATION
THRIFT 401(K) PLAN
Restatement Effective January 1, 1998
COLUMBUS McKINNON CORPORATION
THRIFT 401(K) PLAN
TABLE OF CONTENTS
Page
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INTRODUCTION 1
ARTICLE I -- DEFINITIONS 2
1.1 Definition of Certain Terms 2
1.2 Account 2
1.3 Actual Contribution Percentage Test or ACP Test 2
1.4 Actual Deferral Percentage Test or ADP Test 3
1.5 Affiliate 3
1.6 Base Pay 4
1.7 Beneficiary 4
1.8 Board of Directors 4
1.9 Break in Service 4
1.10 Code 5
1.11 Committee 5
1.12 Contribution 5
1.13 Corporation 5
1.14 Eligible Employee 5
1.15 Employee 7
1.16 Employer 7
1.17 Employment Commencement Date 7
1.18 ERISA 7
1.19 Highly Compensated Employee 7
1.20 Investment Fund 8
1.21 Leased Employee 8
1.22 Limitation Year 8
1.23 Matching Contribution 9
1.24 Matching Contribution Account 9
1.25 Normal Retirement Age 9
1.26 Participant 9
1.27 Plan 9
1.28 Plan Year 9
1.29 Qualified Domestic Relations Order or QDRO 9
1.30 Salary Reduction Contribution 9
1.31 Salary Reduction Contribution Account 9
1.32 Schedule 9
1.33 Testing Compensation 9
1.34 Trust Agreement 10
1.35 Trust Fund 10
1.36 Trustee 10
1.37 Valuation Date 10
1.38 Year of Vesting Service 10
ARTICLE II -- PARTICIPATION 12
2.1 In General 12
2.2 Participation after Reemployment 12
2.3 Transfers 13
2.4 Notice and Enrollment 13
ARTICLE III -- PARTICIPANT CONTRIBUTIONS 14
3.1 Salary Reduction Contributions 14
3.2 Matching Contributions 14
3.3 Rollover Contributions 15
ARTICLE IV -- LIMITATIONS ON CONTRIBUTIONS 17
4.1 Maximum Amount of Contributions 17
4.2 Nondiscrimination Requirements 17
4.3 Adjustments 19
4.4 Distribution of Excess Contributions 20
4.5 Distribution of Excess Aggregate Contributions 20
4.6 Distribution of Excess Deferrals 21
ARTICLE V -- LIMITATION ON ANNUAL ADDITIONS 22
5.1 General Limitation 22
5.2 Adjustment to Reduce Annual Addition 22
5.3 Limitation Applicable to Participants who also
Participate in a Defined Benefit Plan 23
5.4 Rules for Applying Limitation 23
ARTICLE VI -- PARTICIPANTS' ACCOUNTS 25
6.1 Accounts 25
6.2 Adjustment of Accounts 25
6.3 Valuation of Accounts 26
6.4 Notice to Participants 26
ARTICLE VII -- FUNDING AND INVESTMENTS 27
7.1 Funding Policy and Method 27
7.2 The Investment Funds 27
7.3 Investment of Contributions 27
7.4 Investment Elections 28
7.5 Allocation of Withdrawals, Loans and Distributions 29
ARTICLE VIII -- RIGHTS TO ACCOUNTS 30
8.1 Separation from Service 30
8.2 Death 30
8.3 Designation of Beneficiaries 30
8.4 Restrictions on Distribution 32
8.6 Qualified Domestic Relations Orders 33
8.7 Claims Procedures 33
ARTICLE IX -- DISTRIBUTION OF ACCOUNTS 34
9.1 Time of Distribution 34
9.2 Form of Distribution. 35
9.3 Required Minimum Distributions 35
9.4 Eligible Rollover Distributions 36
9.5 Application for Benefits 37
9.6 Payment to Infants and Incompetent Persons 37
ARTICLE X -- WITHDRAWALS DURING EMPLOYMENT AND LOANS 39
10.1 Withdrawal After Age 59 1/2 39
10.2 Rollover Contributions 39
10.3 Hardship Withdrawals 39
10.4 Loans 42
10.5 Loan Documents and Policy 44
ARTICLE XI -- OPERATION AND ADMINISTRATION 46
11.2 Thrift Plan Committee 46
11.3 Authority of Committee 47
11.4 Allocation and Delegation of Responsibilities 48
11.5 Multiple Fiduciary Capacities 48
11.6 Employment of Advisers 48
11.7 Records and Reports 49
11.8 Protection of Committee and Others 49
11.9 Administration Expenses 49
11.10 Bonding 50
ARTICLE XII -- ESTABLISHMENT OF TRUST 51
12.1 Establishment of Trust 51
12.2 Investment of Trust Assets 51
12.3 Exclusive Benefit of Trust 51
12.4 Return of Contributions 51
ARTICLE XIII -- PARTICIPATION BY AFFILIATES 53
13.1 Participation by Affiliates 53
13.2 Termination of Participation 53
ARTICLE XIV -- AMENDMENT AND TERMINATION 55
14.1 Amendment of Plan 55
14.2 Termination of Plan or Discontinuance
of Contributions 55
14.3 Suspension or Modification of Contributions 55
ARTICLE XV -- TOP-HEAVY PROVISIONS 57
15.1 Purpose of this Article 57
15.2 Definitions 57
15.3 Top-Heavy Plan 59
15.4 Top-Heavy Ratio 59
15.5 Application of Top-Heavy Rules 61
15.6 Minimum Employer Contributions 61
15.7 Change in the Law 62
ARTICLE XVI -- MISCELLANEOUS 63
16.1 Plan Not a Contract of Employment 63
16.2 Construction 63
16.3 Benefits Payable Only from Plan Assets 63
16.4 Provisions of Plan Binding on All Persons 63
16.5 Non-Alienation of Benefits 63
16.6 Limitations on Merger, Consolidation, Etc. 64
16.7 Uniformed Services Employment and
Reemployment Rights Act 64
16.8 Appendices and Schedules 64
16.9 Headings For Convenience Only 64
16.10 Applicable Law 64
Schedule A -- Participating Employers
Schedule 1 -- Merger of the Spreckels Industries, Inc. Employee Incentive
Savings Plan into the Plan, Effective June 30, 1998
COLUMBUS McKINNON CORPORATION
THRIFT 401(K) PLAN
1998 Restatement
Effective January 1, 1998
INTRODUCTION
Columbus McKinnon Corporation (the "Corporation") established the COLUMBUS
McKINNON CORPORATION THRIFT 401(K) PLAN (the "Plan") effective as of August 1,
1984. The Plan has been amended from time to time and, most recently, was
amended and restated in its entirety effective January 1, 1989. The 1989
Restatement of the Plan was further amended by Amendment Nos. 1 through 3.
The Corporation desires to amend the Plan to include Matching Contributions
subject to graded vesting, effective January 1, 1998. Because of the extensive
changes to the Plan required to include Matching Contributions and in order to
comply with tax law changes made by the Small Business Job Protection Act of
1996 and other recent legislation, the Corporation has determined to restate the
Plan in its entirety, effective January 1, 1998.
In accordance with the foregoing, the Corporation hereby amends and
restates the Plan in its entirety, to read as set forth in this document,
effective as of January 1, 1998, except as otherwise provided. The Plan document
as amended and restated herein is referred to as the "1998 Restatement."
Certain provisions of the 1998 Restatement are required by law to be
effective as of dates prior to January 1, 1998 and are hereby made effective as
of the dates required by law.
Except as otherwise provided in this Introduction or in the text of a
particular provision of the 1998 Restatement, the Plan shall be governed for
Plan Years ending on or before December 31, 1997 by the provisions of the Plan
as amended and in effect at the relevant time.
The Plan is a profit sharing plan within the meaning of Section 401(a)(27)
of the Internal Revenue Code of 1986 and contains a cash or deferred arrangement
that is intended to qualify under Section 401(k) of said Code.
Columbus McKinnon Corporation Thrift 401(k) Plan
Page 2 of Restatement Effective January 1, 1998
ARTICLE I
DEFINITIONS
1.1 DEFINITION OF CERTAIN TERMS. The words and phrases defined in this Article I
when used in this Plan shall have the meanings indicated, unless a different
meaning is plainly required by the context. Words used in the masculine shall be
read and construed in the feminine where they would so apply. Wherever
appropriate, words used in the singular shall include the plural and words in
the plural shall include the singular.
1.2 ACCOUNT means any account maintained on behalf of a Participant by the
Committee in accordance with Section 6.1.
1.3 ACTUAL CONTRIBUTION PERCENTAGE TEST OR ACP TEST means the actual
contribution percentage test set forth at Section 401(m)(2) of the Code and
Treasury Regulations thereunder pursuant to which Matching Contributions for a
Plan Year must satisfy one of the following tests:
(a) The 1.25 Test. The average (the "actual contribution percentage") of
the individual ratios Matching Contributions to Testing Compensation (the
"actual contribution ratio") for all Eligible Employees who are making or are
entitled to make Salary Reduction Contributions and who are Highly Compensated
Employees does not exceed the product of 1.25 multiplied times the actual
contribution percentage for all other Eligible Employees who are making or are
entitled to make Salary Reduction Contributions; or
(b) The 2 Plus 200 Test. The actual contribution percentage for all
Eligible Employees who are making or are entitled to make Salary Reduction
Contributions and who are Highly Compensated Employees does not exceed the
actual contribution percentage for all other Eligible Employees who are making
or are entitled to make Salary Reduction Contributions by more than 2 percentage
points and the actual contribution percentage for all Eligible Employees who are
making or are entitled to make Salary Reduction Contributions and who are Highly
Compensated Employees is no more than 200 percent of the actual contribution
percentage for all other Eligible Employees who are making or are entitled to
make Salary Reduction Contributions.
(c) Use of Contribution Percentage from Preceding Plan Year. For Plan Years
beginning on and after January 1, 1997, the actual contribution percentage used
in the ACP Test for a given Plan Year, for Eligible Employees who are not Highly
Columbus McKinnon Corporation Thrift 401(k) Plan
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Compensated Employees, shall be the actual contribution percentage of such
Employees for the preceding Plan Year.
1.4 ACTUAL DEFERRAL PERCENTAGE TEST OR ADP TEST means the actual deferral
percentage test set forth at Section 401(k)(3) of the Code and Treasury
Regulations thereunder pursuant to which the Salary Reduction Contributions for
a Plan Year must satisfy one of the following tests:
(a) The 1.25 Test. The average (the "actual deferral percentage") of the
individual ratios of Salary Reduction Contributions to Testing Compensation (the
"actual deferral ratios") for all Eligible Employees who are making or are
entitled to make Salary Reduction Contributions and who are Highly Compensated
Employees does not exceed the product of 1.25 multiplied times the actual
deferral percentage for the preceding Plan Year for all other Eligible Employees
who are making or are entitled to make Salary Reduction Contributions; or
(b) The 2 Plus 200 Test. The actual deferral percentage for all Eligible
Employees who are making or are entitled to make Salary Reduction Contributions
and who are Highly Compensated Employees does not exceed the actual deferral
percentage for all other Eligible Employees who are making or are entitled to
make Salary Reduction Contributions by more than 2 percentage points and the
actual deferral percentage for all Eligible Employees who are making or are
entitled to make Salary Reduction Contributions and who are Highly Compensated
Employees is no more than 200 percent of the actual deferral percentage for all
other Eligible Employees who are making or are entitled to make Salary Reduction
Contributions.
(c) Use of Deferral Percentage from Preceding Plan Year. For Plan Years
beginning on and after January 1, 1997, the actual deferral percentage used in
the ADP Test for a given Plan Year, for Eligible Employees who are not Highly
Compensated Employees, shall be the actual deferral percentage of such Employees
for the preceding Plan Year.
1.5 AFFILIATE means:
(a) any corporation that is a member of a controlled group of corporations
(as defined in Code Section 414(b)) of which the Corporation is also a member;
(b) any trade or business whether or not incorporated that is under common
control (as defined in Code Section 414c)) with the Corporation;
(c) any trade or business required to be aggregated with the Corporation in
accordance with the affiliated service group rules under Code Section 414(m); or
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Page 4 of Restatement Effective January 1, 1998
(d) any other entity required to be aggregated with the Corporation
pursuant to Treasury Regulations under Code Section 414(o); provided, however,
that a corporation or other trade or business shall not be an Affiliate during
any period when it was not related to the Corporation within the meaning of this
Section 1.5.
1.6 BASE PAY
(a) In General. "Base Pay" means, with respect to a Participant for a pay
period or other period, the Participant's compensation as defined in Treasury
Regulation ss.1.415-2(d)(11)(ii) (wages for purposes of income tax withholding),
which is paid to the Participant on any pay day with respect to such pay period
or other period by one or more Employers, reduced by reimbursements or other
expense allowances, cash and noncash fringe benefits, moving expenses, deferred
compensation and welfare benefits, any special payments, and any amounts treated
as wages with respect to restricted stock granted to a Participant (even if the
foregoing items are includable in the Participant's gross income), and increased
by all amounts that would have been paid to the Participant by any Employer on
such pay day but for any salary reduction agreement and that are excluded from
the gross income of the Employee under any one of the Code sections referred to
in Treasury Regulation ss.1.414(s)-1(c)(4) (concerning 401(k) plans, cafeteria
plans and certain other deferred compensation arrangements). The phrase
"aggregate Base Pay" with respect to a Plan Year or other period means the sum
of the periodic payments of Base Pay made to a Participant during such Plan Year
or other period.
(b) Code Section 401(a)(17) Limitation. In no event shall a Participant's
aggregate Base Pay for a Plan Year beginning January 1, 1994 or any subsequent
Plan Year exceed, for any purpose of the Plan, $150,000 or such larger amount as
the Secretary of the Treasury may determine for such Plan Year under Section
401(a)(17) of the Code. Section 1.6(b) in the form set forth hereinabove shall
be effective January 1, 1997.
1.7 BENEFICIARY means any person who is receiving or may become entitled to
receive distribution of a Participant's Accounts on account of the death of a
Participant, and shall include a trust, estate or legal representative.
1.8 BOARD OF DIRECTORS means the board of directors of the Corporation.
1.9 BREAK IN SERVICE.
(a) In General. An Employee shall incur a one-year Break in Service for
each 12 month computation period in which an Employee is credited with less than
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501 Hours of Service. For purposes of determining Years of Vesting Service the
computation period shall be the calendar year.
(b)Special Rule for Maternity or Paternity Absence. Solely for the purpose
of determining whether a Break in Service has occurred, an Employee who is
absent from service by reason of the Employee's pregnancy, the birth of the
Employee's child, the placement of a child with the Employee by reason of
adoption, or care for such child immediately following such birth or adoption,
shall be credited with up to 501 Hours of Service at the rate such Hours of
Service would normally have been credited to the Employee but for such absence.
The Hours of Service shall be credited to the Employee in the computation period
in which the absence commenced if necessary to avoid a Break in Service in that
period or, in any other case, in the immediately following computation period.
1.10 CODE means the Internal Revenue Code of 1986, as amended, and as it may be
amended, and corresponding provisions of future laws, as they may be amended.
1.11 COMMITTEE means the Thrift Plan Committee appointed to administer the Plan,
as provided in Section 11.2.
1.12 CONTRIBUTION means Salary Reduction Contributions and Matching
Contributions.
1.13 CORPORATION means Columbus McKinnon Corporation, a New York corporation.
1.14 ELIGIBLE EMPLOYEE.
(a) In General. Effective April 1, 1998, "Eligible Employee" means any
Employee who is employed by an Employer and who is regularly employed at a
facility located within the United States of America.
(b)Exclusion of Certain Employees. The term "Eligible Employee" shall not
include any employee:
(1) Collective Bargaining Employees -- who is employed in any
bargaining unit covered under a collective bargaining agreement which does
not provide for participation by employees of such unit in this Plan;
(2) Leased Employees -- who is employed as a Leased Employee;
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(3) Contract Employee -- whose services are performed in the capacity
of a consultant or contractor or other capacity pursuant to a written
contract which provides that his services are to be rendered in a capacity
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other than as a regular employee, or who is compensated by fees or similar
charges requiring the submission of invoices, as opposed to being
compensated by a regular fixed salary or wage; or
(4) Employees Temporarily Assigned to U.S. Locations -- who [1] is
regularly employed outside the United States, [2] is employed within the
United States by an Employer pursuant to a temporary assignment, and [3]
was not covered under the Plan immediately prior to such temporary
assignment.
(c) Definition of Eligible Employee Before April 1, 1998. Effective
February 24, 1995 through March 31, 1998, "Eligible Employee" means an Employee
of an Employer who at the time of reference is a member of the class eligible to
participate in the Plan, to wit,
(1) an Employee compensated on the basis of a regular fixed weekly,
bi-weekly, monthly or semi-monthly salary as opposed to an hourly wage, and
an office Employee regardless of how compensated (but, beginning February
24, 1995, excluding an Employee regularly employed by the Corporation's
Durbin Durco Division in Reform, Alabama except at provided in Section
1.14(c)(6),
(2) as of January 1, 1989, any nonunion factory Employee regularly
employed in the Corporation's Tonawanda, New York facility, regardless of
how compensated,
(3) as of December 31, 1989 and through and including February 23,
1995, any person employed by Positech Corporation, regardless of how
compensated,
(4) as of January 1, 1992, any nonunion factory Employee regularly
employed in the Corporation's Lexington, Tennessee, Manatee, Florida or
Chattanooga, Tennessee facility, regardless of how compensated,
(5) as of February 24, 1995, any person regularly employed at the
Positech division of the Corporation, regardless of how compensated, and
(6) as of April 1, 1995, any Employee regularly employed by the
Corporation's Durbin Durco Division in Reform, Alabama who is compensated
on the basis of a regular fixed weekly, bi-weekly, monthly or semi-monthly
salary and who is exempt from overtime pay under the Fair Labor Standards
Act.
Columbus McKinnon Corporation Thrift 401(k) Plan
Page 7 of Restatement Effective January 1, 1998
(7) The following Employees are specifically excluded from the term
"Eligible Employee":
(A) an Employee who is employed in a bargaining unit covered
under a collective bargaining agreement which does not provide for
participation by employees of such unit in this Plan, and
(B) Leased Employees.
1.15 EMPLOYEE means an employee at common law of the Corporation or an
Affiliate, and a Leased Employee of the Corporation or an Affiliate.
1.16 EMPLOYER means the Corporation and each Affiliate that participates in the
Plan in accordance with Article XIII. Schedule A contains a list of all
Employers.
1.17 EMPLOYMENT COMMENCEMENT DATE means the first date for which an Employee is
directly or indirectly paid or entitled to payment for the performance of duties
with the Corporation or an Affiliate. An Employee shall not have a new
Employment Commencement Date if he separates from service and is rehired.
1.18 ERISA means the Employee Retirement Income Security Act of 1974, as
amended, and as it may be amended, and corresponding provisions of future laws,
as they may be amended.
1.19 HIGHLY COMPENSATED EMPLOYEE .
(a) Active and Former Employees. The term Highly Compensated Employee
includes highly compensated active Employees and highly compensated former
Employees.
(b) Highly Compensated Active Employees. A highly compensated active
Employee means any Employee who performs service for an Employer or any of its
Affiliates during the current Plan Year and who (i) during the previous year
received Compensation of $80,000 (as adjusted pursuant to Code Section 415(d))
or more, or (ii) was a 5-percent owner of the Employer and/or any of its
Affiliates at any time during the current Plan Year or the previous year.
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(1) Meaning of "5 Percent Owner."
(A) With respect to a corporation, "5 percent owner" means any
person who owns (or is considered as owning within the meaning of Code
Section 318) more than 5 percent of the outstanding stock of such
corporation or stock possessing more than 5 percent of the total
combined voting power of all stock of such corporation.
(B) With respect to any entity that is not a corporation, "5
percent owner" means any person who owns more than 5 percent of the
capital or profits interest in such entity.
(c) Highly Compensated Former Employees. A highly compensated former
Employee includes any former Employee who separated from service (or was deemed
to have separated on account of a reduction in compensation pursuant to Treasury
Regulations under Code Section 414(q) prior to the determination year, performs
no service for the Employer or any of its Affiliates 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.
(d) Application of Code and Regulations. The determination of who is a
Highly Compensated Employee shall be made in accordance with Code Section 414(q)
and the Treasury Regulations thereunder.
(e) Effective Date. Section 1.19 in the form set forth hereinabove shall be
effective January 1, 1997.
1.20 INVESTMENT FUND means one of the separate investment funds maintained
within the Trust Fund, as described in Section 7.2.
1.21 LEASED EMPLOYEE .
(a) In General. "Leased Employee" means any person who is not an employee
under common law of any Employer or Affiliate and who provides services to an
Employer or an Affiliate ("recipient") if: (i) such services are provided to the
recipient pursuant to an agreement between the recipient and any other person
("leasing organization"), (ii) such person has performed such services for the
recipient (or for the recipient and related persons) on a substantially
full-time basis for a period of at least one year, and (iii) such services are
performed under the primary direction or control of the Employer. Section 1.21
(a) in the form set forth hereinabove shall be effective January 1, 1997.
(b)Treatment of Leased Employees. Once an individual becomes a Leased
Employee, the individual shall be taken into account in determining whether the
Plan satisfies the coverage requirements of Section 410(b) of the Code, and
service as a Leased Employee shall be counted as service for purposes of
eligibility to participate and vesting, but Leased Employees shall not be
eligible to participate in the Plan.
Columbus McKinnon Corporation Thrift 401(k) Plan
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1.22 LIMITATION YEAR means the twelve month period beginning April 1 and ending
March 31.
1.23 MATCHING CONTRIBUTION means a contribution made for the benefit of a
Participant pursuant to Section 3.2.
1.24 MATCHING CONTRIBUTION ACCOUNT means an Account established under Section
6.1 to which are credited Matching Contributions.
1.25 NORMAL RETIREMENT AGE means the date on which a Participant reaches his
65th birthday.
1.26 PARTICIPANT means an Eligible Employee who participates in the Plan in
accordance with Article , and includes a former Eligible Employee who has not
received complete distribution of his Accounts.
1.27 PLAN means the Columbus McKinnon Corporation Thrift 401(k) Plan, as set
forth herein, and as it may be amended from time to time.
1.28 PLAN YEAR means the twelve consecutive month period beginning on January 1
and ending on December 31.
1.29 QUALIFIED DOMESTIC RELATIONS ORDER OR QDRO means any judgment, decree or
order (including approval of a property settlement agreement) that (i) relates
to the provision of child support, alimony payments or marital property rights
to a spouse, former spouse, child or other dependent of a Participant, (ii) is
made pursuant to a State domestic relations law (including a community property
law), and (iii) constitutes a "qualified domestic relations order" within the
meaning of Section 414(p) of the Code.
1.30 SALARY REDUCTION CONTRIBUTION means a contribution made for the benefit of
a Participant pursuant to Section 3.1.
1.31 SALARY REDUCTION CONTRIBUTION ACCOUNT means an Account established under
Section 6.1 to which are credited Salary Reduction Contributions.
1.32 SCHEDULE means a schedule attached to this Plan document which provides
special rules applicable to a specified group of Participants whose Accrued
Benefits are determined in part with reference to service earned under this Plan
before April 1, 1998, or to service earned under a different pension plan.
Columbus McKinnon Corporation Thrift 401(k) Plan
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1.33 TESTING COMPENSATION
(a) In General. "Testing Compensation" means, in the case of each Employee,
and for each Plan Year or other period, the Employee's compensation as defined
in Treasury Regulation ss.1.415-2(d)(11)(ii) (wages for purposes of income tax
withholding) which is paid to the Employee during the Plan Year by the
Corporation and any Affiliate, plus all amounts that would have been paid to the
Employee by the Corporation and each Affiliate during the Plan Year or other
period but for any salary reduction agreement and that are excluded from the
gross income of the Employee under any one of the Code sections referred to in
Treasury Regulation ss.1.414(s)-1(c)(4) (concerning 401(k) plans, cafeteria plan
and certain other deferred compensation arrangements).
(b) Code Section 401(a)(17) Limitation. In no event shall a Participant's
Testing Compensation for the 1994 Plan Year or any subsequent Plan Year exceed,
for any purpose of the Plan, $150,000 or such larger amount as the Secretary of
the Treasury may determine for such Plan Year under Section 401(a)(17) of the
Code. Section 1.33(b) in the form set forth hereinabove shall be effective
January 1, 1997.
1.34 TRUST AGREEMENT means the Columbus McKinnon Corporation Thrift 401(k) Plan
Trust Agreement, effective January 1, 1984, by and between the Corporation and
the Trustee, as it has been and may be amended, and any subsequent trust
agreement between the Corporation and a successor Trustee.
1.35 TRUST FUND means the assets of the Plan held by the Trustee under the Trust
Agreement.
1.36 TRUSTEE means the trustee or trustees serving under the Trust Agreement.
1.37 VALUATION DATE means the last business day of each month. The value of a
Participant's Accounts showing his interest in each Investment Fund within the
Trust Fund, shall be determined as of each Valuation Date. The value of a
Participant's interest in the Plan is the aggregate value of his Accounts
(including his allocable share of any portion of the Trust Fund which at the
time of reference is not held in an Investment Fund). The value of a
Participant's interest in each Investment Fund and in the Trust Fund shall be
determined only as of a Valuation Date.
1.38 YEAR OF VESTING SERVICE.
(a) In General. An Employee shall be credited with a Year of Vesting
Service for each calendar year ending on or after the Employee's 18th birthday
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in which the Employee is credited with at least 1,000 Hours of Service, subject
to the exclusions set forth in Section 1.38(b).
(b) Effect of a Break in Service. In the event that an Employee is
reemployed following a one-year Break in Service, service completed by the
Employee prior to the Break in Service shall be excluded from his Years of
Vesting Service in accordance with this Section 1.38(b) :
(1) One Year Hold-out. If an Employee who has not become partially
vested in his Matching Contribution Account incurs a one-year Break in
Service, the service credited prior to the Break in Service shall
thereafter be excluded from his Years of Vesting Service until the Employee
has completed a Year of Vesting Service after the Break in Service.
(2) Five Year Break in Service. If an Employee who has not become
partially vested in his Matching Contribution Account incurs a number of
consecutive one-year Breaks in Service which equals or exceeds the greater
of five or the aggregate number of the Employee's prior Years of Vesting
Service (determined without regard to his age but excluding therefrom any
Years of Vesting Service disregarded by reason of any prior Break in
Service), the service credited prior to the Break in Service shall
thereafter be excluded from his Years of Vesting Service.
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ARTICLE II
PARTICIPATION
2.1 IN GENERAL .
(a) Participants on March 31, 1998. Each Eligible Employee who was a
Participant in the Plan on March 31, 1998 shall continue to be a Participant on
and after that date.
(b)Participants after March 31, 1998. Each Eligible Employee who was not a
Participant in the Plan on March 31, 1998 shall be eligible to become a
Participant on the first day of the month coinciding with or next following the
expiration of 90 calendar days since his Employment Commencement Date, provided
he is then an Eligible Employee.
(c) Interruption of Eligible Employee Status. If the first day on which an
Eligible Employee may commence participation occurs during a period the Eligible
Employee is not performing any services as an Eligible Employee for any reason
except a termination of employment, then such Eligible Employee may commence
participation as of the date he again begins performing such services, or as of
the first day of any subsequent month, provided he is then an Eligible Employee.
2.2 PARTICIPATION AFTER REEMPLOYMENT .
(a) Reemployment of Former Participant. Notwithstanding any interruption of
employment, an Eligible Employee who has once become a Participant may commence
participation in the Plan as of the date he again becomes an Eligible Employee.
(b) Reemployment of Eligible Employee Who Satisfied Service Requirement. An
Eligible Employee who ceases to be an Employee after having satisfied the
service requirement but before the first day of the month on which he may first
commence participation and who again becomes an Eligible Employee may commence
participation in the Plan on the later of (i) the first day of the month he
could have first commenced participation but for the interruption of Employee
status, or (ii) the date he again becomes an Eligible Employee. Such Eligible
Employee may also commence participation on the first day of any month
subsequent to the dates described in (i) and (ii) above.
(c) Reemployment of Employee Who Did Not Satisfy Service Requirement. If an
Employee separates from service before having satisfied the service requirement
and is rehired, he may commence participation in the Plan as of the first day of
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Page 13 of Restatement Effective January 1, 1998
any month coinciding with or next following the expiration of 90 calendar days
since his Employment Commencement Date, or as of the first day of any subsequent
month, provided he is then an Eligible Employee.
2.3 TRANSFERS .
(a) Transfer Outside Eligible Class. In the event a Participant is
transferred on a regular basis to an Affiliate or to a job classification with
the Corporation whereby he ceases to be an Eligible Employee, he shall cease to
be eligible to receive Contributions, but otherwise he shall remain a
Participant until his Accounts are distributed, or until his death, if earlier.
(b) Transfer Into Eligible Class. If the employment status of an Employee,
including a Leased Employee, is changed so that he becomes an Eligible Employee,
he shall be given credit for his prior service with the Corporation or an
Affiliate, and may commence participation in accordance with Section 2.1(b).
(c) Immediate Participation. In any of the cases described in Section
2.3(b) , if the Employee has met the service requirement for participation at
the time of the transfer or change in job classification which make him an
Eligible Employee, he may commence participation as of the first day of the
month following the date he becomes an Eligible Employee.
2.4 NOTICE AND ENROLLMENT .
(a) Notice to Eligible Employee. Within a reasonable time before an
Eligible Employee becomes eligible to commence participation in the Plan, the
Committee shall provide notice to the Eligible Employee of his right to
participate in the Plan.
(b) Enrollment in Plan. An Eligible Employee must file with the Committee a
properly completed authorization form before he may commence participation in
the Plan. The authorization form may be filed by an Eligible Employee at any
time after he becomes an Eligible Employee, and must be filed at least 15 days
prior to the day the Eligible Employee will commence participation in the Plan
(or within such other time period as the Committee may prescribe). Such
authorization form shall be in a form prescribed by the Committee, and shall
include an authorization for the deduction of Salary Reduction Contributions
from the Eligible Employee's Base Pay, as provided in Section 3.1.
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ARTICLE III
PARTICIPANT CONTRIBUTIONS
3.1 SALARY REDUCTION CONTRIBUTIONS .
(a) Election and Commencement of Salary Reduction Contributions. On the
authorization form described in Section 2.4(b), an Eligible Employee shall elect
that his Base Pay be reduced by a specified full percentage of at least 1
percent and not more than 15 percent and to have such amount contributed by his
Employer to the Plan on his behalf. Such election will be effective commencing
with the first pay period that begins on or after the date his participation
commences, and will continue in effect until changed or discontinued. The
percentage elected by any Eligible Employee who is a Highly Compensated Employee
is subject to reduction by the Committee to such extent as it deems advisable in
order to insure compliance with Article IV and Article V.
(b)Change or Discontinuance of Election. A Participant may discontinue his
salary reduction or change his rate of salary reduction (within the limits of
Section and subject to Articles IV and Article V), as of the first day of any
month, by filing a revised authorization form with the Committee at least 15
days before such day (or within such other time period as the Committee may
prescribe). Such discontinuance or change shall be effective commencing with the
first pay period that begins on or after such first day.
(c) Payment of Salary Reduction Contributions. An Employer will contribute
to the Plan on behalf of each of its Employees for whom a salary reduction
election is in effect for a pay period, a Salary Reduction Contribution in an
amount equal to the amount by which the Participant's Base Pay was reduced for
such pay period.
(d) Payment to Trustee. Salary Reduction Contributions shall be paid to the
Trustee as soon as practicable after the end of the pay period for which the
contributions were made, provided that in all events such contributions shall be
so paid to the Trustee not later than 15 days after the end of the calendar
month in which such pay period ends. Salary Reduction Contributions shall be
credited to each Participant's Accounts as of the Valuation Date that coincides
with the last business day of the month in which such pay period ends.
(e) Vesting. Salary Reduction Contributions shall be fully vested and
non-forfeitable at all times.
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3.2 MATCHING CONTRIBUTIONS .
(a) Contribution Required. The Employer of each person who is an Employee
on the last day of a Plan Year and on whose behalf a Salary Reduction
Contribution was made during the Plan Year shall contribute to the Plan on
behalf of such Employee a Matching Contribution in an amount determined under
Section 3.2(b).
(b) Amount of Contribution. The Matching Contribution required to be made
on behalf of an Employee under Section 3.2(a) shall be an amount equal to 50
percent of the Salary Reduction Contributions made on behalf of the Employee
during the Plan Year provided, however, that Matching Contributions shall not
exceed 3 percent of the Employee's Base Pay for the Plan Year.
(c) Payment to the Trustee. Matching Contributions shall be paid to the
Trustee and credited to each Participant's Matching Contribution Account as soon
as may be reasonably practicable following the last day of the Plan Year for
which the Matching Contributions are made.
(d) Vesting. A Participant shall be fully vested in his Matching
Contribution Account upon attaining Normal Retirement Age or in the event the
Participant dies when he is an Employee. In addition, a Participant shall become
vested in his Matching Contribution Account before Normal Retirement Age in
accordance with the following vesting schedule:
Participant's Number of Vested Percentage in Participant's
Years of Vesting Service Matching Contribution Account
- ------------------------ -------------------------------
less than one year .............................. 0 percent
one year but less than two years ................ 20 percent
two years but less than three years ........... 40 percent
three years but less than four years ............ 60 percent
four years but less than five years ............ 80 percent
five or more years ............................. 100 percent
3.3 ROLLOVER CONTRIBUTIONS .
(a) Contributions Permitted. With the consent of the Committee a
Participant (or an Eligible Employee who is or will be eligible to participate
in the Plan upon meeting service requirement of Section 2.1(b)) may rollover his
interest in another plan qualified under Section 401(a) or 403(a) of the Code to
this Plan, provided:
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(1) The rollover to this Plan is made no later than the sixtieth day
after distribution was made from the other plan, or is pursuant to a direct
transfer under Section 401(a)(31) of the Code, and
(2) The distribution from the other plan qualifies as an "eligible
rollover distribution" within the meaning of Section 402(c)(4) of the Code.
(b) Rollovers from IRAs. A rollover to this Plan may also be made from an
individual retirement arrangement qualified under Section 408 of the Code,
provided no amount in the account and no part of the value of the annuity is
attributable to any source other than a "rollover contribution" (as defined in
Section 402(c) of the Code) from another plan that was qualified under Section
401(a) or 403(a) of the Code and such rollover contribution was deposited in
such account or annuity within 60 days after distribution from such other plan,
and the entire amount received in the distribution from the individual
retirement account or individual retirement annuity is transferred to this Plan
no later than the 60th day after distribution was made from the IRA.
(c) Rollover Account. The Committee shall establish and maintain for each
Participant who has made a rollover contribution a separate Account ("Rollover
Account") reflecting such contribution, the income thereon and the disbursements
therefrom. A Participant may not borrow from his Rollover Account and the value
of such account will not be taken into consideration in determining the amount
available for borrowing pursuant to Section 10.4(c).
(d) In-Service Distribution. Participant whose rollover account has been
held in the Plan at least 24 months may, upon written request to the Committee,
withdraw from his rollover account such amount as he shall specify. Such a
withdrawal will be effective as of the first Valuation Date that occurs at least
15 days after his withdrawal request is filed.
(e) Vesting. A Participant shall be at all times fully and non-forfeitably
vested in his rollover account.
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ARTICLE IV
LIMITATIONS ON CONTRIBUTIONS
4.1 MAXIMUM AMOUNT OF CONTRIBUTIONS .
(a) Limitation on Annual Additions. In no event shall the sum of Salary
Reduction Contributions and Matching Contributions credited to a Participant's
Accounts for any Limitation Year be in an amount that would cause the Annual
Addition for such Participant to exceed the amount permitted under Section 5.1.
(b) Limitation Based on Employer Deductions. In no event shall the sum of
Salary Reduction Contributions and Matching Contributions for any Plan Year
exceed the maximum amount deductible under Section 404(a)(3) of the Code or if
less, the maximum amount deductible under Section 404(a)(7) of the Code, reduced
by Employer contributions to a pension plan described in Section 404(a)(7) of
the Code which covers the same Employees. All such contributions are conditioned
on their deductibility under Section 404 of the Code.
(c) Limitation on Salary Reduction Contributions. In no event shall Salary
Reduction Contributions made on behalf of any Participant for any calendar year
exceed $7,000 or such higher limit as is in effect for the calendar year under
Section 402(g)(5) of the Code.
(d) Special Nondiscrimination Limitations. In no event shall Salary
Reduction Contributions or Matching Contributions made by or on behalf of a
Highly Compensated Employee for any Plan Year exceed the limits under Section
4.2.
4.2 NONDISCRIMINATION REQUIREMENTS .
(a) Salary Reduction Contributions. Salary Reduction Contributions for any
Plan Year must satisfy the Actual Deferral Percentage Test.
(b) Matching Contributions. Matching Contributions for any Plan Year must
satisfy the Actual Contribution Percentage Test.
(c) Rules for Applying ADP and ACP Tests. In applying the Actual Deferral
Percentage Test and the Actual Contribution Percentage Test, the following rules
shall be observed:
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(1) Salary Reduction Contributions Taken Into Account. A Salary
Reduction Contribution shall be taken into account only if [1] it is
allocated to the Participant's Account as of a date within the Plan Year,
[2] it is not contingent upon participation in the Plan or the performance
of services after the allocation date, [3] it is paid to the Trustee no
later than 12 months after the end of the Plan Year, and, [4] it relates to
Base Salary which would have been received during the Plan Year but for the
Participant's election to make Salary Reduction Contributions or is
attributable to services performed during the Plan Year and, but for such
election, would have been received by the Participant within 2-1/2 months
after the close of the Plan Year.
(2) Matching Contributions Taken Into Account. A Matching Contribution
shall be taken into account only if it is allocated to a Participant's
Matching Contribution Account as of a date within the Plan Year, it is paid
to the Trustee no later than 12 months after the Plan Year, and it relates
to Salary Reduction Contributions made with respect to the Plan Year.
(3) Testing Compensation Taken Into Account. Testing Compensation
taken into account shall be Testing Compensation for the Plan Year, or at
the Committee's option, Testing Compensation attributable to the portion of
the Plan Year during which the Participant was an Eligible Employee and met
the age and time requirements for participation. If Testing Compensation
attribution to the portion of the Plan Year is used, the limit shall be
applied uniformly to all Eligible Employees for the Plan Year.
(4) No Double Testing. No contribution included in the Actual Deferral
Percentage Test for a Plan Year shall also be included in the Actual
Contribution Percentage Test for such Plan Year. No contribution included
in the Actual Contribution Percentage Test for a Plan Year shall also be
included in the Actual Deferral Percentage Test for such Plan Year.
(5) No Multiple Use of Alternative Limitations. If one or more Highly
Compensated Employees is required to be taken into account in applying both
the Actual Deferral Percentage Test and the Actual Contribution Percentage
Test for a Plan Year (or in applying either of those tests in another plan
of the Corporation or an Affiliate for a Plan Year ending with or within
the Plan Year), then the "2 plus 200 test" set forth in Sections 1.3 and
1.4 shall be applied in such manner as to avoid a prohibited multiple use
of such test, in accordance with Treasury Regulations.
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(6) Aggregation of Other Plans.
(i) Aggregation to Meet Discrimination or Coverage Requirements.
If the Plan and one or more other plans which include cash or deferred
arrangements are considered one plan for purposes of Section 401(a)(4)
or 410(b) of the Code, the cash or deferred arrangements included in
the Plan and in such other plans shall be treated as one arrangement
for purposes of this Section 4.2.
(ii) Participation in Other Plans by Highly Compensated
Employees. If Salary ReductionContributions or Matching Contributions
are made for a Plan Year for a Highly Compensated Employee who also
participates during the same Plan Year in one or more other plans of
the Corporation or an Affiliate that includes a cash or deferred
arrangement described in Section 401(k) of the Code or employee
contributions or employer matching contributions described in Section
401(m) of the Code, the actual deferral ratio (Section 1.4(a)) or
actual contribution ratio (Section 1.3(a)) of the Highly Compensated
Employee for purposes of this Section shall be computed as if all such
plans were part of this Plan.
(d) Treasury Regulations. The application of the Actual Deferral Percentage
Test and the Actual Contribution Percentage Test shall satisfy such additional
or different requirements as may be required or permitted by Treasury
Regulations.
4.3 ADJUSTMENTS .
(a) Limits on Highly Compensated Employees. The Committee may establish and
modify from time to time maximum limits on the percentage of Base Salary that
may be contributed to the Plan during a Plan Year or portion of a Plan Year by
Participants who are, or who are expected to be, Highly Compensated Employees
for such Plan Year if it believes that such limits are appropriate in order to
satisfy any limitation of Section 4.2.
(b) Other Limitations on Highly Compensated Employees. In addition to
establishing a maximum limit pursuant to Section 4.3(a), or in lieu thereof, in
the case of a Participant who is or who is expected to be a Highly Compensated
Employee for a Plan Year, the Committee may modify his election to make Salary
Reduction Contributions so as to decrease prospectively the Salary Reduction
Contributions to be made on behalf of such Participant if the Committee believes
that such a decrease is appropriate in order to satisfy any limitation in
Section 4.2. Any prospective decrease in Salary Reduction Contributions shall
result in a corresponding decrease in Matching Contributions.
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4.4 DISTRIBUTION OF EXCESS CONTRIBUTIONS .
(a) Required Distribution. If the Actual Deferral Percentage Test has not
been satisfied for the Plan Year after all contributions have been made under
the Plan for the Plan Year, the Committee shall, as soon as practicable but in
no event later than the close of the following Plan Year, distribute the excess
contributions (as defined in Section 401(k)(8) of the Code and Treasury
Regulations thereunder) and the income (or loss) allocable thereto to the
Participant on whose behalf such excess contributions were made in accordance
with Section 401(k)(8) of the Code and the Treasury Regulations thereunder. The
Committee shall make every reasonable effort to make any distribution under this
Section 4.4 on or before March 15 of the Plan Year following the Plan Year for
which the ADP Test was not satisfied. If such distribution includes
contributions which qualified for Matching Contributions, the Matching
Contributions attributable thereto shall be forfeited.
(b) Income (or Loss) Allocable to Excess Contributions.
(1) Standard Allocation Method. The income (or loss) allocable to
excess contributions for the Plan Year shall be determined by multiplying
the income (or loss) allocable to the Participant's Salary Reduction
Account for the Plan Year by a fraction [1] the numerator of which is the
excess contributions for the Plan Year and [2] the denominator of which is
the account balance of the Participant's Salary Reduction Account as of the
beginning of the Plan Year increased by the Participant's Salary Reduction
Contributions for such Plan Year.
(2) Alternative Allocation Method. As an alternative to the standard
method of allocating income (or loss) to excess contributions described in
Section 4.4(b)(1) , the Committee may use any reasonable method for
computing income allocable to excess contributions provided that the method
does not violate Code Section 401(a)(4), is used consistently for all
Participants and for all corrective distributions under the Plan for that
Plan Year, is used for allocating income to Participants' Accounts, and/or
satisfies such other requirements as may be set forth in Treasury
Regulations.
4.5 DISTRIBUTION OF EXCESS AGGREGATE CONTRIBUTIONS.
(a) Required Distribution. If Matching Contributions for a Plan Year do not
satisfy the Actual Contribution Percentage Test after all contributions have
been made under the Plan for such Plan Year, the Committee shall, as soon as
practicable but in no event later than the last day of the following Plan Year,
distribute the excess aggregate contributions (as defined in Section 401(m)(6)
of the Code and Treasury Regulations thereunder) and income (or loss) allocable
thereto to the Participants on whose behalf such excess aggregate contributions
were made in accordance with Section 401(m)(6) of the Code and Treasury
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Regulations thereunder. The Committee shall make every reasonable effort to make
any distribution under this Section 4.5 on or before March 15 of the Plan Year
following the Plan Year for which the Actual Contribution Percentage Test was
not satisfied.
(b) Income or Loss Allocable to Excess Aggregate Contributions. The income
or loss allocable to excess aggregate contributions for the Plan Year shall be
determined in a manner similar to the determination of income or loss allocable
to excess contributions under Section 4.4(b).
4.6 DISTRIBUTION OF EXCESS DEFERRALS .
(a) Permitted Distribution. If, on or before March 1st of any year, a
Participant notifies the Committee, in accordance with Section 402(g)(2)(A) of
the Code and Treasury Regulations thereunder, that all or part of the Salary
Reduction Contributions made for his benefit represent an excess deferral (as
defined in Section 402(g) of the Code) for the preceding taxable year of the
Participant, the Committee shall make every reasonable effort to cause such
excess deferral to be distributed to the Participant no later than April 15
following such notification.
(b) Income or Loss Allocable to Excess Deferrals. The income or loss
allocable to excess deferrals for the Plan Year shall be determined in a manner
similar to the determination of income or loss allocable to excess contributions
under Section 4.4(b).
(c) Coordination With Excess Contributions.
(1) The amount of excess contributions to be distributed under Section
4.4 with respect to a Participant for a Plan Year shall be reduced by the
amount of excess deferrals previously distributed to the Participant for
the Participant's taxable year ending with or within the Plan Year.
(2) The amount of excess deferrals that may be distributed under this
Section 4.6 with respect to a Participant for a taxable year shall be
reduced by the amount of excess contributions previously distributed with
respect to the Participant for the Plan Year beginning with or within such
taxable year.
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ARTICLE V
LIMITATION ON ANNUAL ADDITIONS
5.1 GENERAL LIMITATION . The Annual Addition to a Participant's Accounts under
the Plan for any Limitation Year, when added to the Annual Additions to his
accounts for such year under all other defined contribution plans maintained by
the Corporation or any Affiliate, shall not exceed the lesser of (i) $30,000 or
(ii) 25 percent of the Participant's Taxable Compensation for such Limitation
Year. This Section 5.1, in the form set forth hereinabove, shall be effective
for Limitation Years beginning on or after April 1, 1995.
5.2 ADJUSTMENT TO REDUCE ANNUAL ADDITION . A Participant's Annual Addition under
the Plan shall be reduced to satisfy the limitation of Section 5.1 as follows:
(a) Any Salary Reduction Contribution not yet paid to the Trustee for the
Limitation Year shall not be made. The Salary Reduction Contribution shall be
paid instead to the Participant.
(b) Any Salary Reduction Contribution already paid to the Trustee for the
Limitation Year shall, to the extent permitted by the Code and Treasury
Regulations, be withdrawn from the Trust Fund and distributed to the Participant
together with gains attributable to such Salary Reduction Contribution.
(c) If the Annual Addition for any Participant exceeds the limitations of
Section 5.1 after the adjustments described in Section 5.2(a) and 5.2(b), the
excess amounts in the Participant's Accounts shall be held unallocated in a
suspense account and used to reduce Salary Reduction Contributions for the next
Limitation Year (and succeeding Limitation Years, as necessary) for the
Participant if that Participant is covered by the Plan as of the end of the
Limitation Year. However, if the Participant is not covered by the Plan as of
the end of the Limitation Year, then the excess amounts shall be held
unallocated in a suspense account for the Limitation Year and allocated and
reallocated in the next Limitation Year to all of the remaining Participants in
the Plan so as to reduce Salary Reduction Contributions for the next Limitation
Year (and succeeding Limitation Years, as necessary) for all of the remaining
Participants. If a 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 suspense account shall be allocated and
reallocated to the Participants before any Salary Reduction Contributions are
made under the Plan for the Limitation Year.
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5.3 LIMITATION APPLICABLE TO PARTICIPANTS WHO ALSO PARTICIPATE IN A DEFINED
BENEFIT PLAN . In the case of a Participant who participates in or has
participated in a defined benefit plan maintained by the Corporation or an
Affiliate, the sum of the Participant's "defined contribution plan fraction" (as
determined under Section 415(e) of the Code and the Treasury Regulations
thereunder) and his "defined benefit plan fraction" (as determined under Section
415(e) of the Code and the Treasury Regulations thereunder) for such Limitation
Year shall not exceed 1.0. The adjustment required to meet this limitation shall
be made in the defined benefit plan. However, if the adjustment required to meet
this limitation cannot be made in the defined benefit plan, the adjustment shall
be made by reducing Salary Reduction Contributions under this Plan. This Section
5.3 shall not apply after December 31, 1999.
5.4 RULES FOR APPLYING LIMITATION .
(a) Definition of Annual Addition. "Annual Addition" means, in the case of
any Participant and with respect to this Plan, the sum for any Limitation Year
of all Contributions credited to the Participant's Accounts for such year,
unreduced by any distributions under Section 4.4 (excess contributions), Section
4.5 (excess aggregate contributions or Section 4.6 (excess deferrals) (except as
provided in Treasury Regulations under Code Section 415(c)(2)). "Annual
Addition" means, in the case of any Participant and with respect to all other
defined contribution plans maintained by the Corporation or any Affiliate, the
sum for any Limitation Year of all (i) employer contributions, employee
contributions, and forfeitures, as described in Section 415(c)(2) of the Code
and Treasury regulations thereunder, unreduced by any distributions of excess
contributions, excess aggregate contributions, or excess deferrals (except as
provided in Treasury Regulations under Code Section 415(c)(2)), and (ii) amounts
described under Section 415(l)(1) and Section 419(d)(2) of the Code credited to
the Participant's accounts for the Limitation Year.
(b) Definition of Affiliate. For purposes of this Article V, in determining
whether a corporation is an Affiliate, as defined in Section 1.5, membership in
a controlled group of corporations shall be determined on the basis of a 50%
control test rather than an 80% control test.
(c) Definition of Taxable Compensation. "Taxable Compensation" means, with
respect to a Participant for each Limitation Year, compensation as defined under
Code Section 415(c)(3) and the Treasury Regulations thereunder. Effective for
Limitation Years beginning on and after April 1, 1998, "Taxable Compensation"
shall include elective deferrals (as defined in Code Section 402(g)(3)) and
salary reduction contributions under a cafeteria plan that are excluded from
gross income under Code Section 125.
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(d) Code Section 401(a)(17) Limitation. In no event shall a Participant's
Taxable Compensation for a Limitation Year beginning on or after January 1, 1994
exceed $150,000 or such larger amount as the Secretary of the Treasury may
determine for such Limitation Year under Section 401(a)(17) of the Code. This
Section 5.4(d), in the form set forth hereinabove, shall be effective for
Limitation Years beginning on and after April 1, 1997.
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ARTICLE VI
PARTICIPANTS' ACCOUNTS
6.1 ACCOUNTS .
(a) In General. The Committee shall establish and maintain for each
Participant, on a unit basis, one or more of the following individual Accounts,
as appropriate, to record the interest of the Participant in the Trust:
(1) Salary Reduction Contribution Account to which shall be credited
the Participant's Salary Reduction Contributions.
(2) Matching Contribution Account to which shall be credited the
Participant's Matching Contributions.
(b) Additional Accounts and Subaccounts. The Committee shall establish and
maintain a subaccount within each Account to reflect the interest of each
Account in each Investment Fund. The Committee shall also establish and maintain
such other Accounts or subaccounts, including a loan account and/or subaccount,
as it may deem necessary or desirable to carry out the provisions of the Plan.
(c) Segregation of Assets Not Required. The maintenance of individual
Accounts and subaccounts is for accounting purposes only, and a segregation of
the Trust assets to each Account or subaccount shall not be required.
6.2 ADJUSTMENT OF ACCOUNTS . As of each Valuation Date, the Committee shall make
the following adjustments to each Account of each Participant:
(a) Opening Balance. The balance of the Account immediately following the
adjustment of such Account as of the preceding Valuation Date shall be
determined.
(b) Contributions. The Account shall be increased by the amount of any
contributions and any repayments of a loan properly credited to such Account
since the preceding Valuation Date.
(c) Distributions. The Account shall be reduced by the amount of any loans,
withdrawals or distributions properly charged to such Account since the
preceding Valuation Date.
(d) Other Adjustments. The Account shall be appropriately adjusted to
reflect any other transaction affecting it.
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(e) Allocation of Trust Income or Loss. Each subaccount that reflects the
interest of an Account in an Investment Fund shall be appropriately adjusted to
reflect the net increase or decrease in the fair market value of the assets of
the Investment Fund (resulting from income, gain, loss and expense since the
preceding Valuation Date) in which the subaccount is invested. Such net increase
or decrease shall be allocated to each subaccount ratably on the basis of
subaccount balances in a uniform and consistent manner. Each Account shall then
be adjusted to reflect the net increase or decrease of each subaccount of such
Account.
6.3 VALUATION OF ACCOUNTS . The value of a Participant's Accounts showing his
interest in the Trust shall be determined as of each Valuation Date.
6.4 NOTICE TO PARTICIPANTS . Within a reasonable time after the last day of each
Plan Year, the Committee shall notify each Participant (and each alternate payee
under a QDRO and each Beneficiary of a deceased Participant) of the balance in
such Participant's Accounts as of the last day of such Plan Year. The Committee
may in its discretion notify such persons of the balance in their Accounts at
more frequent intervals.
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ARTICLE VII
FUNDING AND INVESTMENTS
7.1 FUNDING POLICY AND METHOD . The funding policy and method of the Plan is the
deposit of all contributions with the Trustee, in accordance with the terms of
the Trust Agreement, with the right given each Participant to designate the
Investment Fund(s) in which his interest in the Trust Fund is to be invested, as
described in this Article. The Committee is responsible for the funding policy
of each of the Investment Funds, including the liquidity needs of each such
Fund.
7.2 THE INVESTMENT FUNDS .
(a) In General. The Committee shall make available three or more Investment
Funds for the investment of a Participant's Salary Reduction Contributions and
Matching Contributions, and rollover contributions, if any. Each of the
Investment Funds shall have such investment objectives as the Committee shall
approve, it being intended that each Participant shall be offered a number of
investment choices, at least some of which have materially different risk and
return characteristics, which will permit the selection by the Participant of an
investment portfolio suitable to his investment objectives. Each of the
Investment Funds shall consist of one or more investment vehicles selected from
time to time by the Committee, including without limitation, pooled funds and/or
mutual funds. Assets of each Investment Fund may be temporarily held in cash or
invested in short-term fixed income obligations issued by governments,
government agencies, or corporations, including bank deposits. The Committee
shall provide reasonably detailed information to the Participants with respect
to the Investment Funds.
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(b) Change of Investment Funds. The Committee shall have the right to add
additional Investment Funds and/or to eliminate one or more existing Investment
Funds with or without replacing it or them with another Investment Fund or
Funds.
(c) Voting of Shares. The Trustee shall be entitled to vote all shares held
in an Investment Fund, including without limitation, shares of a mutual fund.
7.3 INVESTMENT OF CONTRIBUTIONS .
(a) Investment by Participants. Salary Reduction Contributions and Matching
Contributions shall be invested in one or more of the Investment Funds, as each
Participant shall elect, in accordance with Section 7.4.
(b) Change of Investment Fund. If an Investment Fund is eliminated or
replaced (the "Replaced Investment Fund") with a different Investment Fund, the
Committee may direct the Trustee to transfer all of the Account balances
invested in the Replaced Investment Fund to one or more other Investment Funds.
As soon as administratively practicable before or after such transfer, the
Committee shall obtain new investment elections for such Accounts from the
Participants and beneficiaries with such Accounts, and shall designate one or
more Investment Funds to which a Participant's Account balances will be
transferred in the absence of a timely election. The Committee shall also, as
soon as administratively practicable before Investment Funds are eliminated or
replaced, obtain new investment elections from Participants with respect to
future Contributions and shall designate one or more Investment Funds in which
such contributions will be invested in the absence of a timely election by the
Participant.
7.4 INVESTMENT ELECTIONS .
(a) Initial Election.
(1) Salary Reduction Contributions. Each Participant shall file with
the Committee a properly completed investment election designating that his
future Salary Reduction Contributions are to be invested in one or more of
the Investment Funds, in multiples of 5%, or in other percentages or
fractions authorized by the Committee. If no election is ever filed, the
Participant shall be deemed to have elected 100% GIC Fund or similar fixed
income fund selected by the Committee. An election under this Section
7.4(a) shall be effective as of the effective date of the Participant's
participation in the Plan, and shall remain in effect until changed in
accordance with Section 7.4(b).
(2) Matching Contributions. A Participant's Matching Contributions
shall be invested in the same manner as his Salary Reduction Contributions.
(3) Rollover Contribution. Each Participant who makes a rollover
contribution shall designate in writing one or more Investment Funds in
which such contribution is to be invested, in multiples of 5%, or in other
percentages or fractions authorized by the Committee. Such designation
shall be provided to the Committee at least 15 days before the rollover is
made.
(b) Change of Election. A Participant may change his investment election
for future Salary Reduction Contributions by filing a new investment election
with the Committee. Such election shall be effective with respect to Salary
Reduction Contributions and Matching Contributions made after the first
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Valuation Date that occurs at least 15 days after the election is filed (or such
different number of days as may be authorized by the Committee).
(c) Reinvestment of Existing Balances.
(1) In General. A Participant (including a former Participant who has
not received complete distribution of his Accounts) may direct that all or
a portion of his existing balances in any Investment Fund be reinvested in
one or more different Investment Funds, in such percentages or fractions
permitted under Section 7.4(a) as he shall specify.
(2) When Reinvestment Becomes Effective. Transfers out of or into any
Investment Fund (subject to restrictions imposed by individual Investment
Funds) may be made monthly, effective as of the last business day of the
month. A Participant shall direct such transfer by filing a notice with the
Committee at least 15 days prior to the day the transfer is to be effective
(or on such shorter notice as may be authorized by the Committee).
(3) Limitations on Reinvestment. The Committee by rule of general
application may limit the number of elections pursuant to this Section
7.4(c) that may be made during a Plan Year or other period.
7.5 ALLOCATION OF WITHDRAWALS, LOANS AND DISTRIBUTIONS . Where a Participant's
Contributions are invested in more than one Investment Fund, the amount of any
withdrawal, loan, or distribution shall be charged against each such Investment
Fund in proportion to the Participant's Account balance in each, unless the
Committee shall establish procedures permitting Participants to designate the
source of a loan, withdrawal or distribution and the Participant shall have made
a designation.
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ARTICLE VIII
RIGHTS TO ACCOUNTS
8.1 SEPARATION FROM SERVICE . A Participant shall have a fully vested and
non-forfeitable interest in his Salary Reduction Account and Rollover Account at
all times. Upon a Participant's separation from service with the Corporation and
all Affiliates for any reason except death, and including resignation,
retirement, disability or other termination of employment, his Salary Reduction
Account and Rollover Account, and the vested portion of his Matching
Contribution Account shall be subject to distribution in accordance with Article
IX.
8.2 DEATH . If a Participant dies before separating from service with the
Corporation and all Affiliates, or after such separation from service but before
his Accounts have been distributed to him, his Salary Reduction Contribution
Account and Rollover Account, and the vested portion of his Matching
Contribution Account, shall be distributed to his Beneficiary or Beneficiaries
in accordance with Article IX.
8.3 DESIGNATION OF BENEFICIARIES .
(a) Designation of Beneficiary by Married Participant.
(1) Primary Beneficiary. If a Participant was married at the time of
death, he shall be deemed to have designated his surviving spouse as his
sole primary Beneficiary unless prior to his death he effectively
designated as primary Beneficiary one or more persons in addition to or
instead of his surviving spouse.
(2) Consent of Spouse. No designation under Section 8.3(a)of a person
other than the Participant's spouse shall be effective unless either (i)
the Participant's surviving spouse consents in writing to the designation,
such consent acknowledges the effect of the designation and identifies the
non-spouse Beneficiary (including any class of Beneficiaries or any
contingent Beneficiaries) or authorizes the Participant to designate
Beneficiaries without further consent, and such consent is witnessed by a
notary public or Plan representative, or (ii) it is established to the
satisfaction of the Committee that the consent required under (i) above can
not be obtained because there is no spouse, because the spouse cannot be
located, or because of such other circumstances as the Secretary of the
Treasury may prescribe, and (iii) if the non-spouse Beneficiary designated
in accordance with this Section 8.3(a) is a natural person, such person
survives the Participant.
(3) Consent Limited to Current Spouse. Any consent by a spouse under
Section 8.3(a)(2), or a determination by the Committee with respect to that
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spouse under Section 8.3(a)(2), shall be effective only with respect to
that spouse. Any such consent shall be irrevocable, but shall be effective
only with respect to the specific Beneficiary designation unless the
consent expressly authorizes the Participant to designate Beneficiaries
without further consent.
(4) Secondary Beneficiary. A married Participant may designate one or
more secondary Beneficiaries with the consent of his spouse or, if his
spouse is the primary Beneficiary, without the consent of his spouse. Any
consent must be in accordance with Sections 8.3(a)(2) and 8.3(a)(3).
(b) Designation of Beneficiary by Unmarried Participant. A Participant who
is not married may designate one or more primary Beneficiaries and one or more
secondary Beneficiaries. However, if the Participant subsequently marries, the
Participant's spouse shall be deemed his sole primary Beneficiary unless his
spouse consents to the designation of a different Beneficiary in accordance with
Section 8.3(a).
(c) Manner of Designation. The designation of a Beneficiary shall be on a
form prescribed by the Committee and filed with the Committee before the
Participant's death.
(d) Right to Change Beneficiary. A Participant who has designated a
Beneficiary in accordance with this Section 8.3 may change the designation at
any time by filing a new designation with the Committee. A new designation shall
not be effective unless it satisfies the consent requirements under Section
8.3(a).
(e) Multiple Beneficiaries. Unless the Participant's designation provides
otherwise, if more than one primary Beneficiary has been designated, the
surviving primary Beneficiaries shall share equally. If no primary Beneficiary
survives the Participant, and the Participant has designated one or more
secondary Beneficiaries, the surviving secondary Beneficiaries shall share
equally. A Participant's designation may provide different rules as to the
respective interests of multiple or alternative Beneficiaries, and such
different rules shall be recognized by the Plan.
(f) No Surviving Beneficiary. If a Participant dies without a Beneficiary
(and has no surviving spouse deemed a Beneficiary pursuant to Section
8.3(a)(1)), his entire interest in the Plan shall be paid to his estate.
(g) Meaning of "Spouse". "Spouse" shall mean the person to whom a
Participant was legally married on the date of his death, but shall not include
a spouse who was legally separated from the Participant pursuant to a court
order.
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8.4 RESTRICTIONS ON DISTRIBUTION .
(a) Restrictions on In-Service Distribution. Except as provided in Article
X (Withdrawals During Employment and Loans), no Participant shall be entitled to
receive any portion of his Accounts under the Plan prior to his retirement,
death, or other separation from service with the Corporation and all Affiliates.
(b) General Restriction. Notwithstanding any other provision in the Plan to
the contrary, no distribution of a Participant's Accounts (except his rollover
account as permitted in Section) shall occur unless a distribution of such
Participant's Salary Reduction Contributions would be permitted under Section
401(k)(2)(B) of the Code and Treasury Regulations thereunder.
8.5 FORFEITURE OF MATCHING CONTRIBUTION ACCOUNT.
(a) Forfeiture Following Break in Service. If a Participant ceases to be an
Employee for any reason other than death before his Matching Contribution
Account has become fully vested in accordance with Section 3.2(d) , the
nonvested portion of his Matching Contribution Account shall be forfeited as of
the last day of the Plan Year in which the Participant receives a distribution
(including a direct rollover) of his vested Account Balances under the Plan or,
if sooner, as of the last day of the Plan Year in which he incurs his fifth
consecutive one-year Break in Service.
(1) Restoration of Forfeited Amount. If the Participant incurs a
forfeiture following a distribution of the vested portion of his Matching
Contribution Account balance, the amount forfeited shall be restored if the
Participant completes an Hour of Service before incurring five consecutive
one-year Breaks in Service. In such case, the vested amount credited to the
Participant's Matching Contribution Account on any given date after his
reemployment shall equal A minus B where: "A" is the product of the
Participant's Vested Percentage (determined under Section 3.2(d)) on such
date multiplied times the sum of his total Matching Contribution Account
immediately preceding the prior distribution plus all additions thereto
after his reemployment, and where "B" is the vested portion of the
Participant's Matching Contribution Account balance that was previously
distributed.
(b) Forfeiture Following Death. If a Participant dies before his Matching
Contribution Account has become fully vested in accordance with Section 3.2(d) ,
the nonvested portion of his Matching Contribution Account shall be forfeited as
of the last day of the Plan Year in which his death occurs.
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(c) Forfeitures Used to Reduce Employer Contributions. The portion of a
Matching Contribution Account that is forfeited under this Section 8.5 shall be
used to reduce Employer contributions required for Matching Contributions in a
manner determined by the Committee.
8.6 QUALIFIED DOMESTIC RELATIONS ORDERS . A Participant's or Beneficiary's
interest in the Plan and Trust Fund shall be subject to the rights of an
alternate payee under the provisions of a Qualified Domestic Relations Order, to
the extent required by law. The Committee shall establish reasonable procedures
for determining the qualified status of a domestic relations order and for
otherwise dealing with such orders. For the purposes of such orders, a
Participant's "earliest retirement age" under the Plan is the earlier of (i) the
date that the Participant is entitled to a distribution of his Accounts under
Section 9.1, (ii) the date the Participant attains age 50, or (iii) the date
that the Committee determines that a domestic relations order is a Qualified
Domestic Relations Order. In accordance with the terms of a Qualified Domestic
Relations Order, distribution to an alternate payee may be made as soon as
practicable following the Participant's earliest retirement age, provided that
such alternate payee requests and consents to the distribution. The
Participant's consent in accordance with Section 9.1(c)is not required for a
distribution to an alternate payee.
8.7 CLAIMS PROCEDURES . The Committee shall establish and maintain reasonable
claims procedures with respect to each type of benefit under the Plan, which
procedures shall advise Participants and Beneficiaries of the method for
applying for benefits and shall include procedures for review of any benefit
determination, for written notice to the claimant in the event a claim is denied
in whole or in part, and for the review by the Committee of claims denied in
whole or in part.
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ARTICLE IX
DISTRIBUTION OF ACCOUNTS
9.1 TIME OF DISTRIBUTION .
(a) In General. If a Participant's Accounts become distributable under
Section 8.1, distribution of such Accounts shall be made as soon as practicable
after the month in which the Participant separates from service with the
Corporation and all Affiliates. If a Participant's Accounts become distributable
under Section 8.2, distribution of such Accounts shall be made as soon as
practicable after the end of the calendar quarter in which the Committee
receives notice of his death.
(b) Direct Rollover Notice. Notwithstanding Section 9.1(a), distribution of
a Participant's Accounts shall not be made to a Participant or other
"distributee" (as defined in Section 9.4(a)) until at least 30 days after the
Participant or other distributee has received the written explanation required
under Section 9.4(c) , unless the 30-day period has been waived in accordance
with that section.
(c) Consent to Distributions Before Age 65.
(1) Limitation on Immediate Distribution. Notwithstanding Section
9.1(a) , if the value of a Participant's Accounts exceeds $5,000 (or
exceeded $5,000 at the time of any prior distribution), no distribution to
the Participant shall be made before the Participant attains Normal
Retirement Age unless the Participant consents in writing to earlier
payment. The Committee shall give the Participant written notice that he
need not accept distribution prior to Normal Retirement Age. The written
notice shall be furnished at least 30 days, but not more than 90 days
before the date of distribution, unless the Participant waives the 30-day
notice in accordance with applicable Treasury rules. Such notice and
consent shall not be required after the death of the Participant.
(2) Distribution Where Participant Fails to Consent. If the
Participant's consent is required under Section 9.1(c)(1) but is not
provided prior to the time distribution is to be made, distribution shall
be made or commenced as soon as practicable after the end of the month next
following the earliest of the following: (i) the date the Participant
attains Normal Retirement Age, (ii) the date the Committee is notified of
the Participant's death, or (iii) the date the Committee receives from the
Participant a written request for and consent to distribution.
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(d) Latest Date of Distribution. In no event, unless the Participant
otherwise elects in accordance with Section 401(a)(14) of the Code and Section ,
will the payment of a Participant's Accounts commence later than the 60th day
after the latest of the following: (i) the close of the Plan Year in which
occurs the Participant's Normal Retirement Age; (ii) the close of the Plan Year
in which occurs the tenth anniversary of the year in which the Participant
commenced participation in the Plan; or (iii) the close of the Plan Year in
which the Participant's service with the Corporation and all Affiliates
terminates.
(e) Retiree May Defer Distribution. A Participant who separates from
service after age 65, or after age 60 (age 55 after March 31, 1998) if he is
eligible for an immediate pension from a defined benefit plan of his Employer,
may elect, by notice filed with the Committee, to defer distribution of his
Accounts until December 31 of a designated year that is not later than the
taxable year of the Participant in which he will attain age 70 1/2. The
Participant's Accounts shall be distributed as soon as is practicable after the
designated December 31, or as soon as is practicable after the end of any
earlier calendar quarter in which he files a written request for payment.
9.2 FORM OF DISTRIBUTION. Distribution of a Participant's Accounts shall be made
in cash in a lump sum.
9.3 REQUIRED MINIMUM DISTRIBUTIONS .
(a) General Rule. Payment of a Participant's benefit shall commence no
later than April 1 of the calendar year following the calendar year in which the
Participant attains age 70-1/2. Benefits payable during any calendar year
following the calendar year in which the Participant attains age 70-1/2 and
before actual retirement shall be recomputed as of the first day of such
calendar year and shall be increased (but not decreased) to reflect any
additional year of Benefit Service completed during the immediately preceding
calendar year.
(b) Election To Defer Benefits. Notwithstanding Section 9.3(a), a
Participant who is not a "5-Percent Owner" and who continues to be an Employee
after attaining age 70-1/2 may elect to defer the commencement of benefits until
the he ceases to be an Employee. The election shall be made at the time and in
the manner determined by the Committee. The benefit payable to the Participant
upon actual retirement shall be determined under Section 9.3(a). For purposes of
this Section 9.3, a Participant is a "5-percent owner" if he is a 5-percent
owner of the Corporation or any Affiliate within the meaning of Code Section
416(i) at any time during the Plan Year ending with the calendar year in which
he attains age 66-1/2 or any subsequent Plan Year.
(c) Required Distributions. Notwithstanding any other provision in this
Plan, all distributions under the Plan shall be made in accordance with Code
Section 401(a)(9) (concerning required distributions) and the Treasury
Regulations issued thereunder, including the minimum distribution incidental
benefit requirements set forth in Proposed Treasury Regulation Section
1.401(a)(9)-2 (or any successor section). Code Section 401(a)(9) and the
regulations thereunder shall supersede any distribution option or benefit
deferral provision under the Plan that is inconsistent therewith.
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(d) Effective Date. Section 9.3, in the form set forth hereinabove, shall
be effective for Plan Years beginning on and after January 1, 1997.
9.4 ELIGIBLE ROLLOVER DISTRIBUTIONS .
(a) Definitions. For purposes of this Section 9.4, the following terms
shall have the following meanings:
(1) "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 that is one of a series of
substantially equal periodic payments (not less frequently than annually)
made for the life (or life expectancy) of the distributee or the joint
lives (or joint life expectancies) of the distributee and the distributee's
designated beneficiary, or for a specified period of 10 years or more; any
distribution to the extent such distribution is required under section
401(a)(9) of the Code; and the portion of any distribution that is not
included in gross income (determined without regard to the exclusion for
net unrealized appreciation with respect to employer securities).
(2) "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 a surviving spouse, an eligible retirement plan is
an individual retirement account or individual retirement annuity.
(3) "DISTRIBUTEE." A "distributee" includes an Employee or former
Employee. In addition, the Employee's or former Employee's surviving spouse
and the Employee's or former Employee's spouse or former spouse who is an
alternate payee under a qualified domestic relations order, as defined in
Columbus McKinnon Corporation Thrift 401(k) Plan
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section 414(p) of the Code, are distributees with regard to the interest of
the spouse or surviving spouse.
(4) "DIRECT ROLLOVER." A "direct rollover" is a payment by the Plan to
the eligible retirement plan specified by the distributee.
(b) Application of Section. Notwithstanding any provision in the Plan to
the contrary that would otherwise limit a distributee's election under this
Section 9.4, a distributee may elect, at the time and in the manner prescribed
by the Committee, to have all or any portion of an eligible rollover
distribution paid in a direct rollover directly to an eligible retirement plan
specified by the distributee, provided that the eligible rollover distribution
or portion thereof is at least equal to the minimum amounts specified in
Treasury Regulations.
(c) Written Explanation Required. The Committee shall furnish to each
distributee who is entitled to an eligible rollover distribution a written
explanation describing the distributee's right to elect a direct rollover, the
federal income tax withholding rules applicable if the distributee does not
elect a direct rollover, and such other information as may be required under
Section 402(f) of the Code. The written explanation shall be furnished at least
30 days but no more than 90 days before the Annuity Starting Date. The
distributee may elect to waive the 30 day notice requirement, provided that the
distributee is first clearly advised in writing concerning his right to take up
to 30 days to decide whether to elect a direct rollover.
(d) Requirements for Election. Any direct rollover election shall be made
on a form prescribed for that purpose by the Committee, shall advise the
Committee of the name of the eligible retirement plan to which the direct
rollover is to be made, shall include a representation by the distributee that
the recipient plan is an eligible retirement plan, and shall include such
additional information as may be needed by the Committee to effect the direct
rollover. An election made with respect to the first of a series of eligible
rollover distributions shall be deemed to have been made with respect to each
subsequent distribution in the series until a different election is filed with
the Committee.
(e) No Obligation To Determine Status Of Recipient Plan. No fiduciary or
other person acting on behalf of the Plan shall have any obligation to determine
whether the recipient plan identified in a distributee's direct rollover
election is in fact an eligible retirement plan.
9.5 APPLICATION FOR BENEFITS . A Participant (or Beneficiary or alternate payee
under a QDRO) must file an application on a form prescribed by the Committee in
order to request a distribution under the Plan.
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9.6 PAYMENT TO INFANTS AND INCOMPETENT PERSONS . If any Participant (or his
Beneficiary or alternate payee under a QDRO) is under the age of majority or is,
in the judgment of the Committee, legally, physically or mentally incapable of
personally receiving and receipting for any payment due hereunder, payment may
be made to the guardian or other legal representative of such person, or if
none, to such other person or institution that, in the opinion of the Committee,
is then maintaining or has custody of the Participant (or Beneficiary or
alternate payee). Such payments shall constitute a full discharge with respect
thereto. The Committee may withhold the payment of any amount that shall be
payable in accordance with the provisions of the Plan to a person under legal
disability until a representative of such person competent to receive such
payment on his behalf shall have been appointed pursuant to law.
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ARTICLE X
WITHDRAWALS DURING EMPLOYMENT AND LOANS
10.1 WITHDRAWAL AFTER AGE 59 1/2 . A Participant who has attained age 59 1/2 may
withdraw from the Plan such amount as he chooses by written request filed with
the Committee. Withdrawal will be effective as of the first practicable
Valuation Date after such request is filed.
10.2 ROLLOVER CONTRIBUTIONS . A Participant may withdraw Rollover Contributions
(and earnings thereon) from the Plan to the extent permitted in Section 3.3(d).
10.3 HARDSHIP WITHDRAWALS .
(a) Withdrawals Permitted. Any Participant who suffers a financial
hardship, as defined in this Section 10.3, may, during the course of his
employment, file a written request with the Committee to withdraw up to 100% of
the balance of his Account (exclusive of any rollover account) as of December
31, 1988, plus the amount of his Salary Reduction Contributions made after
December 31, 1988 (or their value, if less). If approved, withdrawal will be
effective as of the Valuation Date coinciding with or next following the date of
such approval.
(b) Procedure for Requesting Withdrawal. The request for withdrawal shall
be on a form prescribed by the Committee and shall set forth the amount
requested, the facts establishing the existence of the financial hardship, and
such financial information and supporting data as the Committee by uniform rules
shall require. A request under this Section 10.3 will be approved if the
Participant demonstrates to the satisfaction of the Committee that (i) he has
incurred an immediate and heavy financial need, as described in Section 10.3(d),
and (ii) the withdrawal is necessary to satisfy such need, as described in
Section 10.3(e). If the Committee approves a withdrawal, it shall direct the
Trustee to distribute to the Participant in a single sum the amount required
(subject to the provisions of Section 9.4 concerning direct rollovers).
(c) Amount of Withdrawal. No withdrawal made pursuant to this Section shall
exceed the amount required to satisfy the need created by the hardship. Such
amount may include any amounts necessary to pay any federal, state or local
income taxes or penalties reasonably anticipated to result from the withdrawal.
(d) Meaning of "Financial Hardship". For purposes of this Section 10.3, the
term "financial hardship" means an immediate and heavy financial need of the
Participant as described in this Section 10.3(d).
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(1) Evidence of Financial Hardship. The Committee will determine
whether the Participant has incurred an immediate and heavy financial need
on the basis of the facts and circumstances presented to the Committee. The
following types of expenses shall qualify as an immediate and heavy
financial need:
(A) Capital expenditures for the maintenance or enhancement of a
primary residence, including expenses for major remodeling, alteration
or improvements to such a residence;
(B) Room, board, tuition and other costs associated with the
education of the Participant or a member of his immediate family;
(C) Burial and other expenses associated with the death of a
member of the Participant's immediate family;
(D) Extraordinary legal costs incurred by the Participant or a
member of his immediate family;
(E) Expenses associated with the Participant's adoption of a
child, including medical, legal and transportation costs;
(F) Expenses attributable to casualty or theft losses that would
constitute the type of expenses that would be deductible for federal
income tax purposes;
(G) Expenses incurred as a result of a natural catastrophe (such
as fire, flood, hurricane or tornado); and
(2) Deemed Financial Hardship. The following expenses shall be deemed
to constitute an immediate and heavy financial need:
(A) Expenses for medical care described in Code Section 213(d)
previously incurred by the Participant, the Participant's spouse or
any dependents of the Participant (as defined in Code Section 152) or
necessary for these persons to obtain medical care described in Code
Section 213(d);
(B) Costs directly related to the purchase of a principal
residence for the Participant (excluding mortgage payments);
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Page 41 of Restatement Effective January 1, 1998
(C) Payment of tuition for the next semester or quarter of
post-secondary education for the Participant or his spouse or
dependents, and effective August 15, 1991, payment of tuition and
related educational fees for the next 12 months of post-secondary
education for the Participant, or the Participant's spouse, children
or dependents (as defined in Code Section 152); or
(D) Payments necessary to prevent the eviction of the Participant
from his principal residence or foreclosure on the mortgage of that
residence.
(e) Withdrawal Necessary to Satisfy Need. A withdrawal shall be necessary
to satisfy a Participant's immediate and heavy financial need if one of the
criteria set forth in this Section 10.3(e) is satisfied.
(1) Evidence that Withdrawal is Necessary. A withdrawal shall be
necessary to satisfy the Participant's immediate and heavy financial need
to the extent that the Committee determines, on the basis of the facts and
circumstances presented to the Committee, that the need can not be
satisfied from all other financial resources reasonably available to the
Participant, including reimbursement or compensation by insurance or
otherwise, reasonable liquidation of his assets and assets owned by his
spouse or minor children that are reasonably available to him to the extent
such liquidation would not itself cause an immediate and heavy financial
need, funds available if he discontinues Salary Reductions Contributions
under the Plan, other distributions and nontaxable loans from the Plan and
all other plans maintained by the Corporation and all Affiliates, and loans
available from commercial sources on reasonable commercial terms. A
Participant shall be required to submit to the Committee a complete
financial statement and/or other information acceptable to the Committee to
establish the amount necessary to satisfy the financial need.
(2) Withdrawal Deemed Necessary. At the election of the Participant, a
withdrawal shall be deemed necessary to satisfy a Participant's immediate
and heavy financial need if the following requirements are met: (i) the
withdrawal is not in excess of the amount of the immediate and heavy
financial need; and (ii) the Participant has obtained all distributions,
other than hardship distributions, and all nontaxable loans currently
available under the Plan and all other plans maintained by the Corporation
and all Affiliates. If a Participant elects to rely on this Section
10.3(e)(2), he shall not be eligible to make Salary Reduction Contributions
(or other elective deferrals or employee contributions under any other
qualified or nonqualified plan of deferred compensation of the Corporation
Columbus McKinnon Corporation Thrift 401(k) Plan
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or any Affiliate) for all or any portion of the twelve-month period
immediately following the date on which the Participant receives a hardship
withdrawal pursuant to this Section. In addition, the maximum Salary
Reduction Contribution (and all other elective deferrals subject to Section
402(g) of the Code under plans maintained by the Corporation or any
Affiliates) that can be made by the Participant for the Participant's
taxable year following the taxable year in which the hardship withdrawal
was made shall not exceed the applicable limit for such year set forth in
Code Section 402(g), reduced by the Salary Reduction Contributions (and all
other elective deferrals subject to Section 402(g) of the Code under plans
maintained by the Corporation or any Affiliate) made for such Participant
for the taxable year in which the hardship withdrawal was made.
10.4 LOANS . A Participant may borrow from his Accounts in accordance with the
rules set forth in this Section 10.4.
(a) Definition of Participant. For purposes of this Section 10.4,
"Participant" means a Participant or Beneficiary who is an Employee or is
otherwise a party in interest under ERISA Section 3(14) with respect to the
Plan.
(b) Application for Loan. A Participant's request to borrow from his
Accounts shall be made on an application form prescribed by the Committee. The
Committee will approve the loan if the loan complies with the rules set forth in
this section; provided, however, that the Committee will not approve any loan
if, in the determination of the Committee, such loan might cause the Plan to be
disqualified under Section 401(a) of the Internal Revenue Code.
(c) Amount of Loan.
(1) Minimum Amount. A loan must be at least $1,000 and will be granted
in increments of $100.
(2) Maximum Amount. A loan may not exceed the Participant's Salary
Reduction Contribution Account balance, exclusive of any rollover account,
determined as of the Valuation Date immediately preceding the date of the
loan (adjusted for any subsequent withdrawals but not for any subsequent
additions). In addition, a loan may not exceed one-half of the
Participant's vested Account balances, exclusive of rollover contributions,
determined as of the Valuation Date immediately preceding the date of the
loan (adjusted for any subsequent withdrawals but not for any subsequent
additions). In addition, a loan may not exceed $50,000, reduced by the
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highest outstanding balance of loans from the Plan during the one-year
period ending on the day before the date on which the loan will be made.
(d) Date of Loan. Loans will be made as soon as practicable following the
Committee's approval of the Participant's request to borrow from his Accounts.
(e) Number of Loans. A Participant may have only one loan outstanding at
one time. In addition, a Participant may not take out more than one loan in any
12-month period.
(f) Interest Rate on Loan. Each loan shall bear interest at a rate
determined by the Committee to be commercially reasonable, and shall be
evidenced by a promissory note on such terms as the Committee shall prescribe.
The Committee shall determine the interest rate no less than monthly based upon
interest rates charged by commercial lenders on loans made in Buffalo, New York
under circumstances that are, in the determination of the Committee, similar to
loans under the Plan.
(g) Accounting for Loan.
(1) Source of Funds. A loan will be charged against the borrower's
Salary Reduction Contribution Account and monies for the loan will be
withdrawn from that Account. Repayments of principal and interest shall be
credited to that Account.
(2) Allocation among Investment Funds. If the borrower has Salary
Reduction Contributions invested in more than one Investment Fund, the loan
shall be made proportionately from each such Investment Fund, or in such
other order of priority as the Committee shall determine. Monies received
from a Participant as payments of principal and interest on a loan shall be
invested in the Investment Fund or Funds selected by the Participant in
accordance with his most recent investment election for future Salary
Reduction Contributions, or in such other manner as the Committee shall
prescribe.
(3) Establishment of Loan Account. The outstanding balance of the loan
shall be reflected in a separate bookkeeping loan account maintained for
the borrower.
(h) Term of Loan and Automatic Payment. Each loan shall require by its
terms that it be repaid within five years. Loans shall require monthly,
semi-monthly or other regular (at least quarterly) level payments of principal
and interest in an amount calculated to amortize the principal amount over the
term of the loan. It shall be a condition of each loan to a Participant who is
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an active Employee of an Employer that he execute an appropriate payroll
deduction form to authorize withholding of payments from his pay.
(i) Prepayment of Loan. Each loan shall permit the borrower to prepay the
amount thereof in full without penalty.
(j) Security for Loan. Each loan shall be secured by a lien on the
borrower's vested Accounts existing at any time (except any rollover account).
If the borrower has Contributions invested in more than one Investment Fund, the
lien shall be applied to the same Investment Funds and in the same proportions
as were the sources of the loan. If the borrower's Account is invested in more
than one insurance company contract, the lien shall be applied to the same
contracts and in the same proportions as were the sources of the loan. The
Committee may require a borrower to provide additional security for a loan at
any time when it deems the loan inadequately secured.
(k) Events of Default. The following will constitute events of default
under the loan: (i) nonpayment of any installment of the note when due; (ii)
breach of any of the terms and conditions of the note; (iii) termination of a
borrower's employment for any reason, including death or retirement, or (iv) the
Committee deems the loan inadequately secured and the borrower fails upon the
request of the Committee to provide additional security for the loan as it
determines is necessary. A transfer to an Affiliate that is not an Employer
hereunder, and termination of a Participant's employment as a result of a
temporary layoff, shall not be deemed a termination of employment for purposes
of this paragraph.
(I) Remedy upon Default. Upon any default, the Committee may without notice
accelerate the balance unpaid on the loan. In such case, the Participant may
repay the loan or may direct that the balance of the loan be immediately
satisfied by cancellation of all or a portion of his Accounts securing the loan
equal in amount to the balance on the loan. If the loan remains unpaid for
thirty (30) days, it may be, in the discretion of the Committee, satisfied by
cancellation of such portion of the borrower's Accounts and by distribution to
the borrower or his beneficiary of his promissory note. However, a borrower's
Accounts shall not be applied to repay a loan of a borrower at a time when the
borrower is employed by the Corporation or any Affiliate and has not attained
age 59 1/2 or become totally and permanently disabled.
10.5 LOAN DOCUMENTS AND POLICY .
(a) Loan Documents. The Committee shall prepare the following loan
documents, which shall be executed by the Participant and delivered to the
Committee prior to the disbursement of any loan proceeds: [1] a promissory note
payable to the Trustee and containing such terms and conditions as the Committee
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shall determine; [2] a security agreement granting to the Trustee a lien on
one-half the value of the Participant's Accounts; and [3] in the case of a
Participant who is an Employee, an agreement authorizing the Affiliate that
employs the Participant to deduct installments of principal and interest from
his pay during the period that the loan remains outstanding.
(b) Written Loan Policy. The Committee is authorized to impose terms and
conditions on loans that are in addition to and/or different from the terms and
conditions set forth in Section 10.4, and to change such terms and conditions
from time to time, as it shall deem appropriate. Such additional and/or
different terms and conditions shall be set forth in a written loan policy.
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ARTICLE XI
OPERATION AND ADMINISTRATION
11.1 DIVISION OF AUTHORITY AND RESPONSIBILITY.
(a) Plan Administrator. The Corporation as plan sponsor shall be the
administrator of the Plan within the meaning of Section 3(16) of the ERISA.
(b) Committee. The Committee shall exercise the duties of plan
administrator on behalf of the Corporation. The Committee and its members are
the named fiduciaries with full authority and responsibility to control and
manage the operation and administration of the Plan, except as otherwise
provided in this Section 11.1.
(c) Trustee. The Trustee has exclusive authority and discretion to manage
and control the assets of the Plan under its control except that Participants
direct the investment of their Accounts in accordance with Section 7.3.
(d) Participants. Each Participant shall have exclusive authority and
responsibility to select the Investment Fund or Funds in which his Accounts are
invested.
(e) Board of Directors. The Board of Directors has exclusive authority and
responsibility for appointing and removing members of the Committee, for
changing the funding media, for removing the Trustee, and for appointing a
successor Trustee.
11.2 THRIFT PLAN COMMITTEE .
(a) Appointment of Committee Members. The Committee shall consist of at
least three members appointed by the Board of Directors to serve at its
pleasure. The Board of Directors may appoint or remove a member of the Committee
at any time, by written notice to such member and all other members. A member
shall file with the Secretary of the Corporation an acceptance of his
appointment and may resign by written resignation filed with the Secretary of
the Corporation, effective as of a date specified therein, but not earlier than
such filing. During any period when there are no appointed members of the
Committee, the chief executive officer of the Corporation shall constitute the
Committee. No bond or other security shall be required of any member except as
may be required by law.
(b) Action by the Committee. The Committee shall hold meetings upon such
notice, at such places, and at such time or times as it may from time to time
determine. A majority of the members then in office shall constitute a quorum
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for the transaction of business. All resolutions or other actions taken by the
Committee at any meeting shall be by the vote of a majority of those present.
Upon concurrence in writing of a majority of the members then in office, action
of the Committee may be taken without a meeting. The Committee may authorize one
or more of its members, or any agent, to execute and deliver any instruments or
to direct any payment on its behalf.
(c) Compensation and Expenses. Members who are salaried officers or
employees of the Corporation or an Affiliate shall serve on the Committee
without compensation. Other members may be paid such reasonable compensation as
the Board of Directors shall determine. All members of the Committee shall be
reimbursed for direct expenses properly and actually incurred in the performance
of services on the Committee. In no event shall members of the Committee be
compensated from the assets of the Plan.
(d) Participation in Plan by Members. Members of the Committee who are
officers or employees of any Employer may participate in the Plan to the same
extent as other Eligible Employees, but no such member shall take part in any
discretionary determination directly relating only to his own participation or
benefits.
11.3 AUTHORITY OF COMMITTEE .
(a) In General. The Committee shall have full authority for the control and
management of the operation and administration of the Plan and, in addition to
the specific authority set forth in this document and in the Trust Agreement,
shall have the authority to take all action and to make all decisions and
interpretations which shall be necessary or appropriate in order to administer
and carry out the provisions of the Plan.
(b) Plan Interpretation. The Committee shall interpret the Plan and shall
resolve any ambiguities or inconsistencies and shall decide all questions
arising in the administration, interpretation and application of the Plan.
Without limitation, the Committee shall have full discretionary authority to
determine eligibility for benefits and to construe the terms of the Plan.
(c) Discretionary Authority. The Committee shall have full discretionary
authority in making all decisions and determinations required to be made in the
administration of the Plan. Reference to the Committee's discretion in any other
section of this Plan document is for emphasis only and shall not be construed to
imply a limitation of discretionary authority under any other section.
(d) Decisions Are Binding. Subject to the claims procedures described in
Section 8.7 and subject to applicable law, any decision of the Committee shall
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be conclusive and binding upon all Employees, Participants, Beneficiaries, and
all other persons having or claiming any interest under the Plan.
11.4 ALLOCATION AND DELEGATION OF RESPONSIBILITIES .
(a) Allocation Within Committee. The members of the Committee may allocate
any of its responsibilities, including fiduciary responsibilities, among
themselves, by resolution approved by all members, or by written instrument
executed by all members and filed with the records of the Plan.
(b) Delegation From Committee. The Committee may delegate to other persons,
including the Corporation or any Affiliate, or any officer or employee of the
Corporation or any Affiliate, any of its responsibilities, including fiduciary
responsibilities, by resolution approved by a majority of members, or by an
instrument executed by a majority of members and filed with the records of the
Plan. Written notice of the delegation shall be given to the person or other
party to whom such responsibility is delegated.
(c) Additional Requirements. Any allocation of fiduciary responsibilities,
or delegation of fiduciary or other responsibilities, shall be exercised in a
reasonable manner taking into account the discretionary or ministerial nature of
the responsibility allocated or delegated.
(d) Limitation of Responsibility for Co-fiduciaries. A member of the
Committee to whom a fiduciary responsibility has been allocated, and each person
to whom the Committee has delegated fiduciary or other responsibilities, shall
act severally, without responsibility for the acts of other fiduciaries, except
as otherwise provided by applicable law.
11.5 MULTIPLE FIDUCIARY CAPACITIES . Any person or group of persons, including
the members of the Committee, may serve in more than one fiduciary capacity with
respect to the administration of the Plan and without regard to whether he is an
officer, director, employee, agent or other representative of the Corporation or
of any Affiliate.
11.6 EMPLOYMENT OF ADVISERS . The Committee and its members and, with the
approval of the Committee, any person to whom the Committee has delegated
fiduciary responsibilities, may employ one or more actuaries, accountants, legal
counsel and other advisors as it or he shall reasonably deem necessary for the
control and management of the operation and administration of the Plan or to
render advice with regard to its or his responsibility under the Plan. The fees
of such advisors shall be paid in accordance with Section 11.9.
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11.7 RECORDS AND REPORTS . The Committee shall keep such records and accounts as
it deems appropriate in the control and management of the operation and
administration of the Plan. The Committee shall report from time to time to the
Board of Directors, or its designee, on any and all aspects of the control,
management, operation and administration of the Plan, and shall report on such
matters whenever directed to do so.
11.8 PROTECTION OF COMMITTEE AND OTHERS .
(a) Reliance on Experts. The Committee and each member thereof and each
person or other party to whom it may delegate any duty, responsibility or power
in connection with the operation and administration of the Plan, and the
Corporation and any other Employer and the directors, officers and employees of
all of them shall be entitled to rely conclusively upon, and shall be fully
protected in any action taken by them or any of them in good faith in reliance
upon, any table, valuation, certificate, opinion or report which shall be
furnished to them or any of them by any accountant, counsel or other expert who
shall be employed or engaged by the Committee or by the Corporation or by any
person or other party to whom the Committee has delegated the authority to
engage such expert.
(b) Limitation of Liability. In the administration and operation of the
Plan, neither the Committee, nor any member thereof, nor any person or other
party to whom it may delegate any duty, responsibility or power in connection
with administering and operating the Plan, nor the Corporation or any other
Employer, nor any director, officer, or employee of any of them shall be liable
for any action or failure to act, except for its or his own willful and
intentional misconduct or its or his own breach of fiduciary responsibility.
(c) Indemnification. To the extent permitted under applicable law and the
governing instruments of the Corporation and each other Employer, the
Corporation and each other Employer shall indemnify all of the foregoing
persons, and each of them, and save all such persons, and each of them, harmless
from any loss, cost or expense not covered by insurance for their acts and
conduct in administering and operating the Plan except to the extent such loss,
cost or expense results from their own willful and intentional misconduct.
11.9 ADMINISTRATION EXPENSES . Each Employer shall share in the expenses of the
Plan in the ratio that aggregate Employer Stock Contributions pursuant to
Section made for its Employees during the preceding Plan Year bears to such
contributions made for all Employees during such Year, or in such other
proportions as the Committee shall determine. The Employers shall pay directly
the expenses of administering the Plan, including the fees and disbursements of
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the Trustee (exclusive of brokerage commissions, transfer taxes and similar
costs of acquiring and disposing of securities) except that administrative
expenses charged by the sponsor of an Investment Fund against such Fund shall be
paid from such Fund and not be the Employers. The Employers shall also pay the
fees of any attorney, advisor, or other expert engaged by the Committee to
assist it in the operation and administration of the Plan.
11.10 BONDING . To the extent required under Section 412 of ERISA, the
Corporation shall secure fidelity bonding for every fiduciary of the Plan and
every other person who handles funds or other property of the Plan.
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ARTICLE XII
ESTABLISHMENT OF TRUST
12.1 ESTABLISHMENT OF TRUST . All assets of the Plan shall be held under a Trust
Agreement by a Trustee designated by the Board of Directors. The Trust Agreement
shall provide, among other things, for a Trust to be administered by the Trustee
to which all contributions shall be paid, and the Trustee shall have such
rights, powers and duties as the Trust Agreement shall provide. All assets of
the Trust shall be held, invested and reinvested in accordance with the
provisions of the Plan, including the Trust Agreement. The Trust Agreement shall
form a part of the Plan and all rights and benefits that may accrue to any
person under the Plan shall be subject to the terms of the Trust Agreement. The
Corporation may from time to time enter into such further agreements with the
Trustee or other parties, and make such amendments to the Trust Agreement, as
may be deemed necessary or desirable to carry out the Plan and may from time to
time remove the Trustee and upon removal or resignation of the Trustee designate
a successor Trustee.
12.2 INVESTMENT OF TRUST ASSETS . The Trustee shall have exclusive authority and
discretion to manage and control the assets of the Plan, except that: [1] the
Committee shall select the Investment Funds to be made available under the Plan
from among those available under the Trust Agreement; and [2] the Participants
shall select the Investment Fund or Funds in which their Accounts are to be
invested.
12.3 EXCLUSIVE BENEFIT OF TRUST . All contributions under the Plan shall be paid
to the Trustee and deposited in the Trust. Except as provided in Section 12.4,
all assets of the Trust shall be retained for the exclusive benefit of
Participants and Beneficiaries, and shall be used to pay benefits to such
persons or to pay administrative expenses of the Plan or Trust, and shall not
revert to or inure to the benefit of the Corporation or any Affiliate.
12.4 RETURN OF CONTRIBUTIONS .
(a) Mistake of Fact. If a contribution is made as a result of a mistake of
fact, the contribution shall be returned to the contributing Employer within one
year after payment of the contribution to the Trustee. If such Employer receives
a contribution returned pursuant to this Section 12.4(a), 12.4(b), it shall pay
any portion thereof that represents a Salary Reduction Contribution to the
Participant on whose behalf such contribution.
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(b) Deductibility of Contributions. Each contribution under the Plan is
made subject to the condition that the contribution is deductible under Code
Section 404. If a contribution is not deductible under Section 404 of the Code,
the contribution shall be returned to the contributing Employer within one year
after the disallowance of the deduction. For purposes of the preceding sentence,
a deduction shall be deemed disallowed upon the conclusion of all administrative
and judicial proceedings concerning such disallowance. If such Employer receives
a contribution returned pursuant to this Section 12.4(a), 12.4(b), it shall pay
any portion of the amount returned that represents a Salary Reduction
Contribution to the Participant on whose behalf the contribution was made.
(c) Limitation on the Return of Contributions. In no event shall the return
of a contribution under this Section 12.4 cause any Account to be reduced to
less than it would have been had the mistaken or nondeductible amount not been
contributed. Earnings attributable to the returned amount shall not be returned
and losses attributable to the returned amount shall reduce the amount that is
returned.
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ARTICLE XIII
PARTICIPATION BY AFFILIATES
13.1 PARTICIPATION BY AFFILIATES .
(a) Adoption of the Plan. Any Affiliate that is not an Employer may adopt
the Plan by action of its board of directors and thereby become an Employer.
Adoption of the Plan shall constitute an agreement by the Affiliate to observe
all of the terms of the Plan and Trust Agreement, as then in effect and as
subsequently amended, and to make such contributions to the Trust Fund and to
pay such expenses related to the Plan as may be determined by the Corporation.
(b) Approval of Corporation. Adoption of the Plan by any Affiliate shall be
subject to the approval of the Corporation, shall become effective as of the
date determined by the Corporation, and shall be subject to such special terms
and conditions as may be imposed by the Corporation. Any such special terms or
conditions shall be set forth in a schedule attached to the Plan.
(c) Participation by Employees. Employees of an Affiliate that adopts the
Plan shall commence participation in the Plan on the dates provided under
Article II, or such other dates as may be determined by the Corporation and
shall be credited such pre-participation Years of Eligibility Service (if any)
as may be determined by the Corporation.
13.2 TERMINATION OF PARTICIPATION .
(a) In General. An Affiliate may terminate its participation in the Plan at
any time by action of its board of directors. In addition, the Corporation may
terminate an Affiliate's participation in the Plan at any time. An Affiliate
shall automatically terminate its participation in the Plan if it ceases to be
an Affiliate.
(b) Contributions. In the event that participation in the Plan by an
Affiliate terminates, all contributions theretofore made by the Affiliate shall
remain the sole property of the Trustee for the use of the Plan.
(c) Rights Of Affected Participants. Each Participant who ceases to be an
Eligible Employee by reason of the termination of an Affiliate's participation
in the Plan:
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(1) shall remain subject to all provisions of the Plan including,
without limitation, provisions governing the crediting of Service,
eligibility for benefits and the time and manner of payment of benefits,
and
(2) shall be subject to such special provisions as may be determined
by the Committee and set forth in a schedule attached to the Plan.
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ARTICLE XIV
AMENDMENT AND TERMINATION
14.1 AMENDMENT OF PLAN .
(a) Right to Amend Plan. The Corporation, acting through the Board of
Directors, shall have the right at any time and from time to time to modify or
amend the Plan in any manner. Any amendment of the Plan shall be by written
instrument executed pursuant to the authorization of the Board of Directors. All
amendments shall be subject to the limitations of this Section 14.1.
(b) Prohibition Against Diversion. No modification or amendment shall be
made that would make it possible for any part of the assets of the Plan to be
used for or diverted to purposes other than the exclusive benefit of
Participants or their Beneficiaries, including the payment of reasonable
expenses of administration of the Plan and Trust.
(c) Protection of Accrued Benefits. No modification or amendment shall be
made that would deprive any Participant or Beneficiary, without his consent, of
any benefits under the Plan to which he would have been entitled if his
employment were terminated immediately prior to the effective date of such
modification or amendment, including any benefit protected under Code Section
411(d)(6) and regulations thereunder, except such as may be required in the
opinion of counsel to the Corporation in order that the Plan retain its
qualified status under the Code.
14.2 TERMINATION OF PLAN OR DISCONTINUANCE OF CONTRIBUTIONS .
(a) Right to Terminate Plan. The Corporation, acting through the Board of
Directors, shall have the right to terminate the Plan in whole or part or to
completely discontinue contributions at any time.
(b) Full Vesting Of Affected Participants. Upon termination or partial
termination of the Plan or upon complete discontinuance of contributions
(whether by action of the Corporation or otherwise), the rights of all affected
Participants to Account Balances on the date of such termination or partial
termination or complete discontinuance shall be nonforfeitable.
14.3 SUSPENSION OR MODIFICATION OF CONTRIBUTIONS . The Corporation, acting
through the Board of Directors, shall have the right at any time and from time
to time to suspend any contribution or to change the rate of any contribution,
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for such period as it shall deem appropriate. A reduction in the rate of
Matching Contributions shall not become effective until notice has been given
Participants and Eligible Employees in sufficient time to permit them to adjust
their Salary Reduction Contributions to which the reduced Matching Contributions
will apply.
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ARTICLE XV
TOP-HEAVY PROVISIONS
15.1 PURPOSE OF THIS ARTICLE . The purpose of this Article is to provide
stand-by rules that will become applicable if, and only if, the Plan should ever
be a Top-Heavy Plan as hereinafter defined. It is not anticipated that the Plan
will ever become a Top-Heavy Plan and it is not expected these rules will ever
become operative.
15.2 DEFINITIONS . Solely for purposes of this Article XV, the following
definitions shall apply:
(a) "ACCOUNT BALANCE" means a Participant's account balance under a defined
contribution plan determined under the terms of that plan and Code Section 416
and regulations thereunder. A Participant's Account Balance includes any part of
the Account Balance distributed during the 5-year period ending on the
applicable Determination Date. A Participant's Account Balance shall also
include any contribution not actually made as of the Determination Date, but
that is required to be taken into account on that date under Code Section 416
and the regulations thereunder.
(b) "DETERMINATION DATE" means, with respect to any qualified plan, the
last day of the preceding plan year of such plan, except that, for the first
plan year of such plan, it means the last day of such first plan year.
(c) "KEY EMPLOYEE" means any person who is an Employee or former Employee
of the Section 416 Employer within the meaning of Code Section 416(i) and
regulations thereunder, or a Beneficiary of such person, who, at any time during
the Plan Year that includes the Determination Date, or during any of the four
preceding Plan Years, is or was one of the following:
(1) Officers. An officer of the Section 416 Employer having Section
416 Compensation greater than 50 percent of the limitation in effect under
Code Section 415(b)(1)(A) for such Plan Year. For any such Plan Year, there
shall be treated as officers no more than the lesser of 50 Employees or 10
percent of the Employees or, if greater than 10 percent, three Employees.
For this purpose, officers with the highest annual Section 416 Compensation
shall be selected.
(2) Ten Highest Paid Employees. One of the 10 Employees having Section
416 Compensation greater than the limitation in effect for such Plan Year
under Code Section 415(c)(1)(A) and owning (or considered as owning within
the meaning of Code Section 318 as modified by Code Section 416(i)) an
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interest in the Section 416 Employer which is both more than a 0.5 percent
interest and the largest interests in the Section 416 Employer.
(3) 5 Percent Owners. A person who owns (or is considered to own under
Code Section 318 as modified by Code Section 416(i)) more than 5 percent of
the outstanding stock, or stock possessing more than 5 percent of the
combined total voting power of all stock, of the Section 416 Employer.
(4) 1 Percent Owners Who Earn Over $150,000. A person who owns (or is
considered to own under Code Section 318 as modified by Section 416(i) of
such Code) more than 1 percent of the outstanding stock, or stock
possessing more than 1 percent of the combined total voting power of all
stock, of the Section 416 Employer and receives Section 416 Compensation of
more than $150,000.
(d) "NON-KEY EMPLOYEE" means any person who is an Employee or former
Employee of the Section 416 Employer and is not a Key Employee or a former Key
Employee.
(e) "PERMISSIVE AGGREGATION GROUP" means the Required Aggregation Group
plus any other plan or plans of the Section 416 Employer which, when considered
as a group with the Required Aggregation Group, would continue to satisfy the
requirements of Sections 401(a)(4) and 410 of the Code.
(f) "PRESENT VALUE" of a Section 416 Accrued Benefit means for any plan
year the actuarial present value of the Section 416 Accrued Benefit under the
defined benefit plan expressed as a benefit commencing at normal retirement age
(or attained age, if later) determined on the basis of the actuarial assumptions
set forth in that plan.
(g) "REQUIRED AGGREGATION GROUP" means (i) each qualified plan of the
Section 416 Employer in which at least one Key Employee participates or
participated at any time during the 5-year period ending on the Determination
Date (regardless of whether the plan has terminated), and (ii) any other
qualified plan of the Section 416 Employer which enables a plan described in (i)
to meet the requirements of Sections 401(a)(4) and 410 of the Code.
(h) "SECTION 416 ACCRUED BENEFIT" means a Participant's accrued benefit
under a defined benefit plan determined under the terms of that plan and Code
Section 416 and regulations thereunder. A Participant's Section 416 Accrued
Benefit shall include any distribution of an Section 416 Accrued Benefit within
the 5-year period ending on the applicable Determination Date. The Section 416
Accrued Benefit of a Participant other than a Key Employee shall be determined
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under (i) the method, if any, that uniformly applies for accrual purposes under
all defined benefit plans maintained by the Section 415 Employer, or (ii) if
there is no such method, as if such benefit accrued not more rapidly than the
slowest accrual rate permitted under the fractional rule of Code Section
411(b)(1)(C).
(i) "SECTION 416 COMPENSATION" means a definition of compensation in
Treasury Regulation Section 1.415-2(d) or the taxable compensation stated on the
Employee's Form W-2 for the calendar year that ends with or within the Plan
Year, as determined by the Plan administrator. The same definition of Section
416 Compensation shall be used for all purposes of this Article XV for a Plan
Year but may be different in another Plan Year.
(j) "SECTION 416 EMPLOYER" includes (i) any corporation that is a member of
a controlled group of corporations as defined in Code Section 414(b) that
includes the Plan sponsor, (ii) any trades or businesses (whether or not
incorporated) that are under common control as defined in Code Section 414(c)
that include the Plan sponsor, (iii) any member of an affiliated service group
as defined in Code Section 414(m) that includes the Plan sponsor, and (iv) any
entity required to be included under Code Section 414(o) in accordance with
regulations thereunder.
(k) "TOP-HEAVY PLAN" has the meaning set forth in Section 15.3.
(l) "TOP-HEAVY RATIO" has the meaning set forth in Section 15.4.
15.3 TOP-HEAVY PLAN . The Plan is a Top Heavy Plan for any Plan Year commencing
after December 31, 1983 if any of the following conditions exist:
(a) Top-Heavy Plan. The Top-Heavy Ratio for the Plan exceeds 60 percent and
the Plan is not part of any Required Aggregation Group or Permissive Aggregation
Group.
(b) Top-Heavy Required Aggregation Group. The Plan is part of a Required
Aggregation Group but not part of a Permissive Aggregation Group and the
Top-Heavy Ratio for the Required Aggregation Group exceeds 60 percent.
(c) Top-Heavy Permissive Aggregation Group. The Plan is part of a
Permissive Aggregation Group and the Top-Heavy Ratios for the Plan, any Required
Aggregation Group of which it is part, and the Permissive Aggregation Group all
exceed 60 percent.
Columbus McKinnon Corporation Thrift 401(k) Plan
Page 60 of Restatement Effective January 1, 1998
15.4 TOP-HEAVY RATIO.
(a) Section 416 Employer Maintains No Defined Benefit Plan. If the Section
416 Employer has not maintained any defined benefit plan that had a Section 416
Accrued Benefit during the 5-year period ending on the Determination Date, the
Top-Heavy Ratio for this Plan alone, or for the Required Aggregation Group or
Permissive Aggregation Group as appropriate, is a fraction:
(1) the numerator of which is the total Account Balances under the
defined contribution plan or plans for all Key Employees as of the
applicable Determination Date(s), and
(2) the denominator of which is the total Account Balances under the
defined contribution plan or plans for all Key Employees and Non-key
Employees as of the applicable Determination Date(s), both computed in
accordance with Code Section 416 and regulations thereunder.
(b) Section 416 Employer Maintains a Defined Benefit Plan. If the Section
416 Employer has maintained one or more defined benefit plans that had Section
416 Accrued Benefits during the 5-year period ending on the Determination Date,
the Top-Heavy Ratio for the Required or Permissive Aggregation Group as
appropriate is a fraction:
(1) the numerator of which is the sum of (i) the Account Balances
under the aggregated defined contribution plan or plans and (ii) the
Present Value of Section 416 Accrued Benefits under the aggregated defined
benefit plan or plans for all Key Employees as of the applicable
Determination Dates, and
(2) the denominator of which is the sum of (i) the Account Balances
under the aggregated defined contribution plan or plans and (ii) the
Present Value of Section 416 Accrued Benefits under the aggregated defined
benefit plan or plans for all Key Employees and Non-key Employees, as of
the applicable Determination Dates, all determined in accordance with Code
Section 416 and the regulations thereunder.
(c) Rules Governing Section 416 Accrued Benefits and Account Balances. For
purposes of Section and (b):
(1) The value of Account Balances and the Present Value of Section 416
Accrued Benefits shall be determined as of the most recent Valuation Dates
that fall within the 12-month periods ending with the applicable
Determination Dates, except as provided under Code Section 416 and the
regulations thereunder for the first and second plan years of a defined
benefit plan.
Columbus McKinnon Corporation Thrift 401(k) Plan
Page 61 of Restatement Effective January 1, 1998
(2) The Account Balances and Section 416 Accrued Benefit of a
Participant (i) who is not a Key Employee but who was a Key Employee in a
prior year, or (ii) who has not been credited with at least one Hour of
Service at any time during the 5-year period ending on the Determination
Date will be disregarded.
(3) The calculation of the Top-Heavy Ratio, and the extent to which
distributions, rollovers and transfers are taken into account will be made
in accordance with Code Section 416 and the regulations thereunder.
(4) Deductible employee contributions will not be taken into account
for purposes of computing the Top-Heavy Ratio.
(5) When aggregating plans, the value of Account Balances and Section
416 Accrued Benefits will be calculated with reference to the Determination
Dates of the respective plans that fall within the same calendar year as
the Determination Date for this Plan.
15.5 APPLICATION OF TOP-HEAVY RULES . Notwithstanding anything herein to the
contrary, the following rules shall apply for any Plan Year in which the Plan is
a Top-Heavy Plan.
(a) Minimum Benefit. Each Participant who is a Non-key Employee shall
accrue a minimum contribution determined under Section 15.6(a).
(b) Limitation on Benefits. The dollar limitations taken into account under
Code Section 415(e) in computing the defined benefit plan fraction and the
defined contribution plan fraction shall be adjusted as provided in Code Section
416(h).
(c) Limitation on Compensation. For Plan Years beginning prior to January
1, 1989, the Plan shall provide the special Base Pay limitations of Code Section
416(d).
(d) Special Vesting. All Participants are at all times fully vested in all
of their Accounts; special vesting is not required.
15.6 MINIMUM EMPLOYER CONTRIBUTIONS .
(a) Required Contribution. Subject to Section 15.6(b) and (c), a Non-Key
Employee shall receive at least a minimum allocation of Employer contributions
in each Plan Year that the Plan is determined to be a Top-Heavy Plan. The
minimum allocation shall be in addition to any Salary Reduction Contributions
made on behalf of the Employee with respect to such Plan Year. The minimum
allocation shall equal the lesser of (i) 3 percent of the Non-Key Employee's
Columbus McKinnon Corporation Thrift 401(k) Plan
Page 62 of Restatement Effective January 1, 1998
Section 416 Compensation for the year or (ii) the highest aggregate
contributions (as a percentage of Section 416 Compensation) for any Key
Employee, taking into account Salary Reduction Contributions.
(b) Eligibility to Share. A Non-Key Employee shall receive the minimum
allocation described in Section 15.6(a) provided he has satisfied the service
requirement under Section 2.1 and has not terminated employment with his
Employer and all Affiliates as of the last day of the Plan Year.
(c) Nonduplication of Benefits. A Non-Key Employee's minimum allocation
under this Section 15.6 for a Plan Year shall be reduced by any minimum
allocation he receives for such year under another Top-Heavy defined
contribution plan maintained by his Employer or an Affiliate. If an Employee
also participates for such Plan Year in a defined benefit plan maintained by the
Corporation or an Affiliate, he shall receive in such year the minimum benefit
(within the meaning of Section 416(c)(1) of the Code) under such defined benefit
plan. Notwithstanding the preceding sentence, if such defined benefit plan does
not provide a minimum benefit, each Non-Key Employee covered under this Plan and
such defined benefit plan shall receive a minimum allocation under this Section
15.6 of at least 5 percent of his Section 415 Compensation for the Plan Year.
15.7 CHANGE IN THE LAW . The foregoing provisions have been included in the Plan
in order to comply with Section 416 of the Code. If Code Section 416 is
repealed, in whole or in part, the provisions of this Article XV shall be
inoperative, in whole or in part.
Columbus McKinnon Corporation Thrift 401(k) Plan
Page 63 of Restatement Effective January 1, 1998
ARTICLE XVI
MISCELLANEOUS
16.1 PLAN NOT A CONTRACT OF EMPLOYMENT . The Plan shall not be deemed to
constitute a contract of employment between an Employer and any Employee or
Participant, or to be a consideration for, or an inducement for the employment
of any Employee or Participant by an Employer. Nothing contained in the Plan
shall be deemed to give any Employee or Participant the right to be retained in
service or to interfere with the right of an Employer to discharge any Employee
or Participant at any time without regard to the effect which such discharge
shall have upon his rights, if any, under the Plan.
16.2 CONSTRUCTION . The Plan is intended to qualify under Sections 401(a) and
401(k) of the Code and shall be construed in accordance with such intention. No
Participant or Beneficiary or other person shall be entitled to require the Plan
to provide any benefit or take or refrain from taking any action which the
Committee in its judgment with the advice of counsel believes would be likely to
cause the Plan to fail to so qualify.
16.3 BENEFITS PAYABLE ONLY FROM PLAN ASSETS . All rights of Participants and
Beneficiaries shall be enforceable only against the Trust Fund held by the
Trustee, and no such person shall have any claim against the Corporation or any
other Employer.
16.4 PROVISIONS OF PLAN BINDING ON ALL PERSONS . The Plan, including the Trust
Agreement, and each and every provision hereof and of the Trust Agreement, and
any amendment or modification hereof or of the Trust Agreement, shall be binding
upon all Employees, Participants and their spouses and Beneficiaries hereunder
and all other persons having or claiming to have any interest of any kind or
nature in or under the Plan, and upon their respective heirs, executors,
administrators, successors and assigns.
16.5 NON-ALIENATION OF BENEFITS . Except in connection with a loan to a
Participant pursuant to the Plan or as required by the provisions of a Qualified
Domestic Relations Order or as otherwise required by law, a Participant's or
Beneficiary's interest in the Plan and Trust Fund shall not be subject in any
manner to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance or charge, and any attempt to anticipate, alienate, sell, transfer,
assign, pledge, encumber or charge such interest shall be void; and such
interest shall not in any manner be liable for or subject to the debts,
contracts, liabilities, engagements, or torts of the person who shall be
entitled thereto, nor shall it be subject to attachment or legal process for or
against such person.
Columbus McKinnon Corporation Thrift 401(k) Plan
Page 64 of Restatement Effective January 1, 1998
16.6 LIMITATIONS ON MERGER, CONSOLIDATION, ETC. Subject to the provisions of
this Section, the Plan may be merged or consolidated with, or there may be a
transfer of all or part of the assets of the Plan to, or a transfer to the Plan
of all or part of the assets from, any other plan that is qualified within the
meaning of Section 401(a) of the Code. In the case of any merger or
consolidation with, or transfer of assets or liabilities to or from, any other
plan, each Participant in this Plan (including Participants who have had
benefits transferred to this Plan from other plans) shall be entitled to a
benefit immediately after such merger, consolidation, or transfer equal to or
greater than the benefit the Participant would have received if the Plan and the
other plan had been terminated immediately prior to the merger, consolidation or
transfer of assets, and shall further be entitled to each optional form of
benefit and any other benefit protected under Section 411(d)(6) of the Code to
which the Participant was entitled immediately prior to the merger,
consolidation or transfer of assets. The limitations of this Section shall not
prohibit a merger, consolidation or transfer of assets or liabilities that is
permissible under regulations issued pursuant to Code Section 414(1).
16.7 UNIFORMED SERVICES EMPLOYMENT AND REEMPLOYMENT RIGHTS ACT . Notwithstanding
any provision in the Plan to the contrary, contributions, credit and benefits
with respect to qualified military service will be provided in accordance with
Section 414(u) of the Code. This Section is effective December 12, 1994.
16.8 APPENDICES AND SCHEDULES . The appendices and schedules attached to this
instrument are part of the Plan. Provisions included in an attached appendix or
schedule that affect the rights under the Plan of any person shall not modify
the terms of the Plan except as specifically provided in such appendix or
schedule.
16.9 HEADINGS FOR CONVENIENCE ONLY . Headings of articles, sections, subsections
and appendices are inserted for convenience of reference only and are not to be
used in construing the Plan or any provision thereof.
16.10 APPLICABLE LAW . This Plan shall be construed, administered and enforced
in accordance with the laws of the State of New York except as preempted by the
laws of the United States.
Columbus McKinnon Corporation Thrift 401(k) Plan
Page 65 of Restatement Effective January 1, 1998
IN WITNESS WHEREOF, the Corporation has caused this restated Plan to be
executed by its corporate officers thereunto duly authorized and its corporate
seal to be affixed, this 30th day of June, 1998.
COLUMBUS McKINNON CORPORATION
By /s/ Robert L. Montgomery, Jr.
-----------------------------
Robert L. Montgomery, Jr.
Executive Vice President
527468.1
Columbus McKinnon Corporation Thrift 401(k) Plan
Page 66 of Restatement Effective January 1, 1998
Columbus McKinnon Corporation Thrift 401(k) Plan
Schedule A -- Participating Employers
Employer Date of Participation
- ------- ---------------------
Columbus McKinnon Corporation August 1, 1984
Yale Industrial Products, Inc. April 1, 1998