Exhibit 10.2
RETIREMENT PLAN FOR EMPLOYEES OF
CAPITAL SOUTHWEST CORPORATION AND ITS AFFILIATES
As Amended and Restated Effective April 1, 2006
Capital Southwest Corporation
Dallas, Texas
TABLE OF CONTENTS
Section Page
DEFINITIONS: PARTICIPATION
1.1 - Definitions.........................................................1-1
1.2 - Participation......................................................1-21
1.3 - Leave of Absence and Termination of Service........................1-22
1.4 - Reemployment.......................................................1-25
1.5 - Transfer to or From Status as an Eligible Employee.................1-34
1.6 - Participation and Benefits for Former Leased Employees.............1-37
1.7 - Rights of Other Employers to Participate...........................1-38
1.8 - Service and Termination of Service.................................1-40
NORMAL AMOUNT AND PAYMENT OF RETIREMENT INCOME
2.1 - Normal Retirement and Retirement Income.............................2-1
2.2 - Early Retirement and Retirement Income..............................2-5
2.3 - Disability Retirement and Retirement Income.........................2-6
2.4 - Benefits Other Than on Retirement..................................2-11
SPECIAL PROVISIONS REGARDING PAYMENT OF BENEFITS
3.1 - Optional Forms of Retirement Income.................................3-1
3.2 - Lump-Sum Payment of Small Retirement Income.........................3-7
3.3 - Benefits Applicable to Participant Who Has Been
or Is Employed by Two or More Employers.............................3-8
3.4 - No Duplication of Benefits..........................................3-9
3.5 - Funding of Benefits Through Purchase of
Life Insurance Contract or Contracts................................3-9
GOVERNMENTAL REQUIREMENTS AFFECTING BENEFITS
4.1 - Special Provisions Regarding Amount and
Payment of Retirement Income........................................4-1
4.2 - Limitations on Benefits Required
by the Internal Revenue Service....................................4-20
4.3 - Benefits Nonforfeitable if Plan Is Terminated......................4-22
4.4 - Merger of Plan.....................................................4-23
4.5 - Termination of Plan and Distribution of Trust Fund.................4-23
4.6 - Special Provisions that Apply if Plan is Top-Heavy.................4-29
4.7 - Transfers..........................................................4-37
4.8 - Minimum Distribution Requirements..................................4-38
MISCELLANEOUS PROVISIONS REGARDING PARTICIPANTS
5.1 - Participants to Furnish Required Information........................5-1
5.2 - Beneficiaries.......................................................5-2
TABLE OF CONTENTS
(continued)
Section Page
5.3 - Contingent Beneficiaries............................................5-3
5.4 - Participants' Rights in Trust Fund..................................5-4
5.5 - Benefits Not Assignable.............................................5-4
5.6 - Benefits Payable to Minors and Incompetents.........................5-5
5.7 - Conditions of Employment Not Affected by Plan.......................5-6
5.8 - Notification of Mailing Address.....................................5-6
5.9 - Written Communications Required.....................................5-7
5.10 - Benefits Payable at Office of Trustee...............................5-7
5.11 - Appeal to Committee.................................................5-8
MISCELLANEOUS PROVISIONS REGARDING THE EMPLOYER
6.1 - Contributions.......................................................6-1
6.2 - Employer's Contributions Irrevocable................................6-1
6.3 - Forfeitures.........................................................6-2
6.4 - Amendment of Plan...................................................6-2
6.5 - Termination of Plan.................................................6-4
6.6 - Expenses of Administration..........................................6-5
6.7 - Formal Action by Employer...........................................6-5
ADMINISTRATION
7.1 - Administration by Committee.........................................7-1
7.2 - Officers of Committee; Service Providers............................7-2
7.3 - Action by Committee.................................................7-2
7.4 - Rules and Regulations of Committee..................................7-3
7.5 - Powers of Committee.................................................7-3
7.6 - Duties of Committee.................................................7-4
7.7 - Indemnification of Certain Fiduciaries..............................7-5
7.8 - Actuary.............................................................7-5
7.9 - Fiduciaries.........................................................7-6
7.10 - Applicable Law......................................................7-8
TRUST FUND
8.1 - Purpose of Trust Fund...............................................8-1
8.2 - Benefits Supported Only by Trust Fund...............................8-1
8.3 - Trust Fund Applicable Only to Payment of Benefits...................8-1
First Supplement
RETIREMENT PLAN FOR EMPLOYEES OF
CAPITAL SOUTHWEST CORPORATION AND ITS AFFILIATES
As Amended and Restated Effective April 1, 2006
INTRODUCTION
Capital Southwest Corporation adopted and established a retirement plan,
called the Capital Southwest Corporation Retirement Plan, for the benefit of its
eligible employees effective as of April 1, 1966. Effective as of April 1, 1972,
the Comprehensively Amended Retirement Plan for Employees of Capital Southwest
Corporation was adopted by Capital Southwest Corporation as an amendment and
restatement of the aforementioned retirement plan and, in conjunction therewith,
the Retirement Trust for Employees of Capital Southwest Corporation was adopted
as an amendment and restatement of the original trust agreement. Effective as of
January 1, 1974, Capital Southwest Corporation amended and restated the
aforementioned Comprehensively Amended Retirement Plan for Employees of Capital
Southwest Corporation in its entirety as set forth in an instrument known as the
Retirement Plan for Employees of Capital Southwest Corporation and, in
conjunction therewith, the aforementioned Retirement Trust for Employees of
Capital Southwest Corporation was amended and restated in its entirety as set
forth in a trust agreement of the same title. The said Retirement Plan for
Employees of Capital Southwest Corporation and Retirement Trust for Employees of
Capital Southwest Corporation were subsequently amended and restated in their
entirety effective as of April 1, 1976, as set forth in instruments of the same
titles. Capital Southwest Management Corporation was formed as a subsidiary of
Capital Southwest Corporation in December of 1986, and effective as of January
1, 1987, the employees of Capital Southwest Corporation were transferred to, and
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became employees of, Capital Southwest Management Corporation which, as the
successor employer of such employees, continued the aforementioned retirement
plan on their behalf.
The Whitmore Manufacturing Company under date of July 14, 1961 entered into
a trust agreement whereby it established a retirement plan and trust for certain
of its employees, and under date of April 14, 1965 entered into another trust
agreement whereby it established a different retirement plan and trust for
certain of its other employees. The retirement plans set forth in such trust
agreements were known as The Whitmore Manufacturing Company Retirement Plan and
The Whitmore Manufacturing Company Hourly Rate Pension Plan, respectively.
Effective as of March 1, 1976, the trust agreements setting forth the provisions
of the aforementioned retirement plans were amended and restated, and such
amended and restated retirement plans were subsequently known as The Whitmore
Manufacturing Company Revised Retirement Plan and The Whitmore Manufacturing
Company Revised Hourly Rate Pension Plan, respectively. Effective as of March 1,
1980, the said The Whitmore Manufacturing Company Revised Retirement Plan and
The Whitmore Manufacturing Company Revised Hourly Rate Pension Plan were again
amended and restated, and were consolidated into a single plan and trust, known
as the Retirement Plan for Employees of The Whitmore Manufacturing Company and
the Retirement Trust for Employees of The Whitmore Manufacturing Company.
The Retirement Plan for Employees of The Rectorseal Corporation was adopted
by The RectorSeal Corporation effective as of April 1, 1976, as an amendment and
restatement of the retirement plan and trust which it had originally established
for the benefit of its eligible employees effective as of January 1, 1972. The
said Retirement Plan for Employees of The Rectorseal Corporation was
subsequently amended and restated in its entirety effective as of April 1, 1984,
as set forth in an instrument of the same title.
The Retirement Plan for Employees of Jet-Lube, Inc. was adopted by
Jet-Lube, Inc. effective as of April 1, 1976 as an amendment and restatement of
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the retirement plan and trust which it had originally established for the
benefit of its eligible employees effective as of June 13, 1973. The said
Retirement Plan for Employees of Jet-Lube, Inc. was subsequently amended and
restated in its entirety effective as of April 1, 1984, as set forth in an
instrument of the same title.
The aforementioned Retirement Plan for Employees of Capital Southwest
Corporation and Retirement Trust for Employees of Capital Southwest Corporation,
Retirement Plan for Employees of The Whitmore Manufacturing Company and
Retirement Trust for Employees of The Whitmore Manufacturing Company, Retirement
Plan for Employees of The Rectorseal Corporation and Retirement Plan for
Employees of Jet-Lube, Inc. have subsequently been amended from time to time,
and said retirement plans and trust agreements were further amended and restated
in their entirety effective as of April 1, 1989 as set forth in an instrument
known as the Retirement Plan for Employees of Capital Southwest Corporation and
Its Affiliates, and in a trust agreement, titled Retirement Trust for Employees
of Capital Southwest Corporation and Its Affiliates. In conjunction with such
amendment and restatement, said retirement plans were consolidated and merged,
effective as of April 1, 1989, into a "single plan" within the meaning of
Section 414(l) of the Internal Revenue Code and regulations issued pursuant
thereto. Said retirement plan, as amended and restated effective as of April 1,
1989, contained special provisions for certain employees whose service commenced
prior to such date as set forth in a supplement thereto which was identified as
the "First Supplement to Retirement Plan for Employees of Capital Southwest
Corporation and Its Affiliates as Amended and Restated Effective April 1, 1989."
The said Retirement Plan for Employees of Capital Southwest Corporation and
Its Affiliates has subsequently been amended from time to time, and said
retirement plan is being further amended and is being restated in its entirety
effective as of April 1, 2006 set forth in this instrument.
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The aforementioned First Supplement to Retirement Plan for Employees of
Capital Southwest Corporation and Its Affiliates as in effect on April 1, 1989
shall be attached to and made a part of the plan as amended and restated
effective April 1, 2006, and all references to the "plan" in said supplement
shall on and after April 1, 2006 refer to the plan as amended and restated
effective April 1, 2006 set forth herein and references in said supplement to
specified sections in the plan shall refer to the corresponding sections in the
amended and restated plan even though the corresponding section in the amended
and restated plan may not have the same section number that is specified in said
supplement.
Subject to receipt by the aforementioned Employers of a favorable ruling
that the qualified status of the Retirement Plan for Employees of Capital
Southwest Corporation and Its Affiliates and the Retirement Trust for Employees
of Capital Southwest Corporation and Its Affiliates under Sections 401(a) and
501(a) of the Internal Revenue Code is not adversely affected by such amendment
and restatement, each person who becomes a participant hereunder shall be
entitled upon his retirement or termination of service to such benefits as are
specified in the provisions which follow.
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SECTION 1
DEFINITIONS: PARTICIPATION
1.1 - DEFINITIONS
(A) The following terms as used herein shall have the meanings stated below
unless a different meaning is plainly required by the context:
(1) "Accrued Deferred Monthly Retirement Income Commencing at Normal
Retirement Date" shall mean the monthly retirement income, payable in
the manner described in Section 2.1(C) hereof commencing at the
Participant's Normal Retirement Date, which he has accrued as of a
given date and, with respect to any given date on or after April 1,
1998 and prior to April 1, 2007, shall be equal to the sum of:
(a) 1.25% of his Final Average Monthly Compensation at such given
date multiplied by his number of years of Credited Service at
such given date that are not in excess of 35 years;
plus
(b) 0.65% of that portion, if any, of his Final Average Monthly
Compensation at such given date that is in excess of the Monthly
Covered Compensation that applies to him at such given date
multiplied by his number of years of Credited Service at such
given date that are not in excess of 35 years;
provided, however, that the Accrued Deferred Monthly Retirement Income
Commencing at Normal Retirement Date which a Participant has accrued
as of a given date shall not exceed an amount that is actuarially
equivalent as of such given date to the maximum amount of retirement
income permitted under Section 415 of the Internal Revenue Code; and
provided further, however, that the provisions of Section 4.6 hereof
shall apply in determining the Accrued Deferred Monthly Retirement
Income Commencing at Normal Retirement Date of a Participant who has
accrued Vesting Service during any Plan Year that the Plan is
top-heavy.
Notwithstanding the foregoing provisions of this Section 1.1(A)(1),
the Accrued Deferred Monthly Retirement Income Commencing at Normal
Retirement Date of a Participant at any given date shall not be less
than the Accrued Deferred Monthly Retirement Income Commencing at
Normal Retirement Date which the Participant has
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accrued as of March 31, 1998, based upon the Participant's Credited
Service, Final Average Monthly Compensation, and Monthly Covered
Compensation (or, if applicable, the corresponding terms used to
compute his accrued benefit under the Superseded Plan) determined as
of the earlier of March 31, 1998, or the date of the Participant's
termination of service, under the provisions of the Plan and the First
Supplement then in effect.
Effective April 1, 2007, the Accrued Deferred Monthly Retirement
Income Commencing at Normal Retirement Date which a Participant has
accrued as of a given date on or after April 1, 2007, shall be equal
to the sum of:
(a) 1.20% of his Final Average Monthly Compensation at such given
date multiplied by his number of years of Credited Service at
such given date that are not in excess of 35 years;
plus
(b) 0.65% of that portion, if any, of his Final Average Monthly
Compensation at such given date that is in excess of the Monthly
Covered Compensation that applies to him at such given date
multiplied by his number of years of Credited Service at such
given date that are not in excess of 35 years.
Notwithstanding the foregoing provisions of this Section 1.1(A)(1),
the Accrued Deferred Monthly Retirement Income Commencing at Normal
Retirement Date of a Participant at any given date on or after April
1, 2007, shall not be less than the Accrued Deferred Monthly
Retirement Income Commencing at Normal Retirement Date which the
Participant has accrued as of March 31, 2007, based upon the
Participant's Credited Service, Final Average Monthly Compensation,
and Monthly Covered Compensation determined as of the earlier of March
31, 2007, or the date of the Participant's termination of service,
under the provisions of the Plan and the Supplements then in effect.
(2) "Annuity Starting Date" shall have the meaning assigned in Section
417(f) of the Internal Revenue Code and regulations issued with
respect thereto and shall be the first day of the first period for
which an amount is payable (not the actual date of payment) as an
annuity or any other form. Any auxiliary disability benefits shall be
disregarded in determining the Annuity Starting Date.
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Unless otherwise qualified by the context, the regularly scheduled
Annuity Starting Date of a Participant shall be:
(a) in the case of the benefit payable under Section 2.1 in the event
of his normal retirement, the first day of the month coincident
with or next following the date of his retirement or his Required
Beginning Date, whichever is earlier;
(b) in the case of the benefit payable under Section 2.2 in the event
of his early retirement, the first day of the month coincident
with or next following the date of his retirement;
(c) in the case of the benefit payable under Section 2.3 in the event
of his disability retirement, the date as of which his disability
retirement income payments are scheduled to start under Section
2.3(F);
(d) in the case of the benefit payable under Section 2.4(A) in the
event of termination of service with a vested benefit, the
Participant's Normal Retirement Date or, if applicable, the first
day of the month prior to his Normal Retirement Date that the
Participant has elected in accordance with the provisions of
Section 2.4(A) to start receiving the benefits to which he is
entitled under such section; and
(e) in the case of the benefit payable under Section 3.2 hereof, the
first day of the month coincident with or next following the date
of termination of the Participant's service; provided, however,
if payment is not made under Section 3.2 as of the first day of
the month coincident with or next following the date of
termination of his service but the Committee establishes, in
accordance with a uniform policy applied without discrimination,
a subsequent date as of which calculations shall be made to
determine if voluntary or involuntary cashouts shall be permitted
or required as of such subsequent date under the provisions of
Section 3.2, the Annuity Starting Date shall be such subsequent
date established by the Committee if payment is made under such
section as of such subsequent date;
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provided, however, if the Participant elects pursuant to the
provisions of Section 3.1 hereof to defer the commencement of the
benefit to which he is entitled to a date beyond the regularly
scheduled Annuity Starting Date described above, his Annuity
Starting Date shall be such later date of commencement specified
in his election.
(3) "Beneficiary" shall mean the person or persons or other entity on
whose behalf benefits may be payable under the Plan after a
Participant's death in accordance with the provisions hereof.
(4) "Break in Service" shall mean a period of severance of 12 consecutive
months or longer that immediately follows an employee's date of
termination of service and immediately precedes the date, if any, on
which he next performs an Hour of Service.
(5) "Committee" shall mean the Retirement Committee appointed from time to
time to administer the Plan pursuant to the provisions of Section 7.1
hereof.
(6) "Compensation" shall mean the sum of:
(a) the amounts actually paid to an employee by the Employer for
services rendered, as reported on the employee's Federal income
tax withholding statement (Form W-2 or its subsequent equivalent)
for the applicable calendar year, exclusive, however, of
reimbursements and other expense allowances, fringe benefits
(cash and noncash), including but not limited to automobile
allowances, taxable group life insurance and amounts that are
paid to the employee in cash in lieu of being contributed on his
behalf to a qualified defined contribution plan maintained by the
Employer, moving expenses, welfare benefits, and all other
extraordinary compensation; and
(b) the amounts, if any, that would have been includable in the
employee's Compensation under (a) above for such calendar year if
they had not been contributed on his behalf by the Employer
pursuant to a salary reduction agreement and had not been
excluded from his gross income under the provisions of Section
125 (cafeteria plans), Section 132(f)(4) (qualified
transportation fringes), or Section 402(e)(3) (cash or deferred
arrangements) of the Internal Revenue Code. Amounts under Section
125 include any amounts not available to a Participant in cash in
lieu of group health coverage because the Participant is unable
to certify that he has other health coverage; provided that such
an amount shall be treated as an amount under Section 125 only if
the Employer does not request or collect information regarding
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such Participant's other health coverage as part of the
enrollment process for the health plan.
Any provisions above to the contrary notwithstanding, the annual
Compensation of a Participant for any given calendar year or other
specified 12-consecutive-month period, which is taken into account with
respect to contributions to the Plan and to benefits accruing under the
Plan shall not exceed the maximum annual compensation that may be taken
into account under Section 401(a)(17) of the Internal Revenue Code and
regulations issued with respect thereto (the "IRC Section 401(a)(17) Annual
Compensation Limit").
The IRC Section 401(a)(17) Annual Compensation Limit with respect to any
given calendar year or other specified 12-consecutive-month period shall be
equal to $200,000 or such increased or decreased amount, as the case may
be, that applies as of the January 1 coincident with or immediately
preceding the beginning of such given calendar year or other specified
12-consecutive-month period, pursuant to the provisions of Section
401(a)(17) of the Internal Revenue Code, as amended and rules and
regulations issued with respect thereto. The $200,000 limit on annual
Compensation shall be adjusted for cost-of-living increases in accordance
with Section 401(a)(17)(B) of the Internal Revenue Code.
Notwithstanding the foregoing, for purposes of determining benefit accruals
in a Plan Year beginning after December 31, 2001, Compensation for any
given calendar year or other specified 12-consecutive-month period
beginning before January 1, 2002 shall be limited to $200,000.
In the event that Compensation under the Plan is determined based on a
period of time that contains fewer than 12 calendar months, the IRC Section
401(a)(17) Annual Compensation Limit for that period of time shall be equal
to the IRC Section 401(a)(17) Annual Compensation Limit for the calendar
year during which such period of time begins multiplied by the fraction in
which the numerator is the number of full months in such period of time and
the denominator is 12.
Any provisions herein to the contrary notwithstanding, a Participant's
accrued benefit as of March 31, 1989 shall not be reduced due to the IRC
Section 401(a)(17) Annual Compensation Limit which was imposed under the
Superseded Plan effective as of April 1, 1989 on the amount of his
Compensation. In the event that the IRC Section 401(a)(17) Annual
Compensation Limit is reduced effective as of any date subsequent to
January 1, 1989, a Participant's accrued benefit immediately prior to the
date that such reduction becomes effective shall not be reduced due to the
reduction in such limit.
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(7) "Controlled Group Member" shall mean:
(a) the Employer;
(b) any corporation or association that is a member of a controlled
group of corporations (within the meaning of Section 1563(a) of
the Internal Revenue Code, determined without regard to Section
1563(a)(4) and Section 1563(e)(3)(C) of said Code, except that,
for the purposes of applying the limitations on benefits and
contributions that are required under Section 415 of the Internal
Revenue Code and are described in Section 4.1(A) hereof, such
meaning shall be determined by substituting the phrase "more than
50%" for the phrase "at least 80%" each place that it appears in
Section 1563(a)(1) of said Code) with respect to which the
Employer is a member;
(c) any trade or business (whether or not incorporated) that is under
common control with the Employer as determined in accordance with
Section 414(c) of the Internal Revenue Code and regulations
issued thereunder;
(d) any service or other organization that is a member of an
affiliated service group (within the meaning of Section 414(m) of
the Internal Revenue Code) with respect to which the Employer is
a member; and
(e) any other entity required to be aggregated with the Employer
pursuant to regulations under Section 414(o) of the Internal
Revenue Code.
(8) "Credited Service" shall mean the total period of an employee's
service with the Employer, computed in completed months, during the
period beginning on his Last Date of Commencement of Service and
ending on the date of his retirement or termination of service or,
where applicable, ending on such other date as is specified hereunder;
provided, however, that the following provisions shall apply with
respect to any period of such an employee's service that would be
included in his Credited Service in accordance with the provisions
above:
(a) any complete calendar month that the employee is absent from the
service of the Employer will be excluded from his Credited
Service unless he receives regular Compensation from the Employer
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for all or any portion of such calendar month and except as
otherwise provided below; and
(b) any absence due to the employee's engagement in military service
will, except as provided below, be included in his Credited
Service if such absence is covered by a leave of absence granted
by the Employer or is by reason of compulsory military service
and provided that such employee returns from such absence within
the period of time prescribed in Section 1.3 hereof; and
(c) any service that the employee accrued prior to April 1, 1976
while he was employed on a part-time basis or for a temporary job
will be excluded from his Credited Service;
and provided further, however, that the provisions of Section 1.4
hereof shall apply in the case of an employee who is reemployed with a
reinstatement of Credited Service accrued prior to his Last Date of
Commencement of Service and the provisions of Section 1.5 hereof shall
apply in the case of an employee who is transferred to or from his
status as an eligible Employee.
Any period of an employee's service prior to the Effective Date of the
Plan that was either included with or excluded from the service used
to determine his accrued retirement income under the Superseded Plan
for any reason specified under the terms of the Superseded Plan as in
effect on the day immediately preceding the Effective Date of the Plan
shall be included with or excluded from, as the case may be, his
Credited Service under the provisions of the Plan, except that any
such period of service shall not be excluded on or after April 1, 1988
from a Participant's Credited Service solely because of the fact that
it was accrued after his Normal Retirement Date.
(9) "Designated Nonparticipating Employer" shall mean:
(a) any Controlled Group Member that is not an Employer as defined
herein; and
(b) any other corporation, association, proprietorship, partnership
or other business organization that (i) is not an Employer as
defined herein and (ii) the Sponsoring Employer, by formal action
on its part in the manner described in Section 6.7 hereof,
designates on the basis of a uniform policy applied without
discrimination as a "Designated Nonparticipating Employer" for
the purposes of the Plan.
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(10) "Earliest Annuity Commencement Date" shall mean:
(a) the first day of the month coincident with or next following the
date of termination of the Participant's service if he has
satisfied the age and service requirements to be eligible for a
normal or early retirement benefit under the provisions hereof as
of such termination date; or
(b) the earliest date as of which the Participant could elect to
start receiving retirement income payments under the provisions
of Section 2.4(A) hereof if his service were terminated and he
had not satisfied the age and service requirements to be eligible
for a normal or early retirement benefit under the provisions
hereof as of such termination date.
(11) "Effective Date of the Plan" shall mean April 1, 2006 or such later
date as of which the Plan first became effective with respect to the
particular Employer concerned.
(12) "Eligibility Computation Period" shall mean the 12-consecutive-month
period that is used for the purpose of determining a year of service
for eligibility to participate in the Plan. Initially, the Eligibility
Computation Period shall be the 12-consecutive-month period beginning
on the Employee's Last Date of Commencement of Service and ending with
the first anniversary of his Last Date of Commencement of Service;
provided, however, if the Employee fails to complete 1,000 Hours of
Service during such initial Eligibility Computation Period, the
Eligibility Computation Period shall mean the Plan Year, and the first
of such Plan Year Eligibility Computation Periods shall be the Plan
Year that overlaps the first anniversary of the Employee's Last Date
of Commencement of Service.
(13) "Employee" shall mean any person on the payroll of the Employer whose
wages from the Employer are subject to withholding for the purposes of
Federal income taxes and for the purposes of the Federal Insurance
Contributions Act; provided, however, that such term shall not
include:
(a) any such person who is employed at any division or branch of any
Employer that is formed or acquired by or merged into the
Employer after the Effective Date of the Plan unless the
Employer, by formal action on its part in the manner described in
Section 6.7 hereof, provides that such persons who are employed
at such division or branch shall, subject to the provisions of
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(b), (c) and (d) below, be eligible for participation in the Plan
in accordance with the provisions hereof;
(b) any such person who is a participant and is accruing benefits (or
who, upon his satisfaction of any age and service requirements
specified thereunder as a condition of participation, will be
eligible to become a participant and accrue benefits) under any
other qualified defined benefit pension plan maintained by the
Employer or to which the Employer makes contributions on his
behalf based upon his employment with the Employer;
(c) any such person who is included in a unit of persons employed by
the Employer who are covered by an agreement which the Secretary
of Labor finds to be a collective bargaining agreement between
employee representatives and the Employer if retirement benefits
were the subject of good faith bargaining between such employee
representatives and the Employer and such persons are not
required by that agreement to be covered in the Plan;
(d) any individual who by contract is not classified by the Employer
as a common law employee of the Employer, even if such individual
is included on the Employer's payroll for Federal income tax
withholding purposes or whether such person is later classified
as an employee by the Internal Revenue Service, the Department of
Labor, a court, an administrative agency, or an Employer;
(e) the Director of Business Development of Cargo Chemical
Corporation;
(f) any such person who is a nonresident alien and who receives no
earned income (within the meaning of Section 911(b) of the
Internal Revenue Code) from the Employer which constitutes income
from sources within the United States (within the meaning of
Section 861(a)(3) of the Internal Revenue Code); or
(g) any such person who is treated by an Employer at the time of his
performance of services for such Employer as either a leased
employee (within the meaning of Section 414(n) of the Internal
Revenue Code) or an independent contractor for Federal income tax
purposes.
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A person in the employment of the Employer shall be deemed for the
purposes of the Plan to be included in a unit of persons employed by
the Employer who are covered by an agreement which the Secretary of
Labor finds to be a collective bargaining agreement between employee
representatives and the Employer as long as he is permanently assigned
to a job or job classification covered by the terms of such a
collective bargaining agreement. In the event any such collective
bargaining agreement expires or is terminated, it shall be deemed that
such collective bargaining agreement continues to cover all persons in
the employment of the Employer who are permanently assigned to jobs or
job classifications covered thereby, in accordance with the provisions
thereof, during the period of time subsequent to the expiration or
termination thereof, but in no case to exceed 12 months, provided that
negotiations commence and ensue between the parties to such expired or
terminated agreement for the purpose of entering into a new or
modified collective bargaining agreement to replace the expired or
terminated agreement. In the event of the complete cessation of
negotiations without the adoption of a new or modified collective
bargaining agreement prior to the lapse of a 12-month period of time
from the date of the expiration or termination of such collective
bargaining agreement, then such expired or terminated agreement shall
for the purposes of the Plan be deemed to cease covering the persons
in the employment of the Employer who are permanently assigned to jobs
or job classifications covered thereby as of the date of such
cessation and not before.
(14) "Employer" shall mean, collectively or distributively as the context
may indicate, the Sponsoring Employer and any other corporations,
associations, joint ventures, proprietorships, partnerships or other
business organizations that have adopted and are participating in the
Plan in accordance with the provisions of Section 1.7 hereof.
(15) "Final Average Monthly Compensation" shall mean the Participant's
average monthly rate of Compensation from the Employer for the five
successive calendar years, out of the 10 completed calendar years
immediately preceding the first day of the month coincident with or
next following the date on which his service terminates for any reason
(or, where applicable, immediately preceding such other date as is
specified hereunder), that give the highest average monthly rate of
Compensation for the Participant. If a Participant completes fewer
than five successive calendar years of employment with the Employer
preceding such date, his actual number of calendar years of employment
shall be substituted for such five-calendar-year period for the
purpose of determining his Final Average Monthly Compensation.
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The Participant's average monthly rate of Compensation will be
determined by dividing the total Compensation received by him during
such five-calendar-year period (or such lesser period described above)
by the number of months for which he received Compensation from the
Employer in such five-calendar-year period (or such lesser period
described above). The number of months for which he received
Compensation from the Employer may be computed, to the extent he was
paid on other than a monthly basis, by determining the number of pay
periods ending within such five-calendar-year period (or such lesser
period described above) for which he received Compensation from the
Employer and converting such pay periods into months by dividing the
number thereof, if weekly, by 4-1/3, if biweekly, by 2-1/6, and, if
semi-monthly, by 2.
In computing Final Average Monthly Compensation for a Participant who
has returned to the active service of the Employer following a full
calendar year or calendar years during which he did not receive any
regular Compensation from the Employer because of a leave of absence
granted by the Employer or because of his reemployment with a
reinstatement of his prior Vesting Service and Credited Service as
described in Section 1.4 hereof, such full calendar year or calendar
years during which he did not receive any regular Compensation from
the Employer shall be ignored or excluded in determining the 10
completed calendar years and the five successive calendar years (or
such lesser period described above) to be used in determining the
Participant's Final Average Monthly Compensation at a subsequent date.
Anything above to the contrary notwithstanding, if a Participant's
service is terminated for any reason and he has not received any
Compensation during any preceding calendar years, his "Final Average
Monthly Compensation" shall mean his average monthly rate of
Compensation received from the Employer during the calendar year in
which his service was terminated. Such average monthly rate of
Compensation will be determined in accordance with the procedure
described above, based upon the total Compensation that he received
and the number of months for which he received Compensation from the
Employer during such calendar year.
Notwithstanding any provision of this Section 1.1(A)(15) to the
contrary, for purposes of determining a Participant's average monthly
rate of Compensation on or after April 1, 1998 and prior to April 1,
2007, the Participant's Compensation for a calendar year shall not
include the portion of any bonus or aggregated bonuses paid in such
calendar year which exceeds (a) 40% of the Participant's total base
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pay in the calendar year, for years prior to 2003, and (b) 25% of the
Participant's total base pay in the calendar year, for years after
2002. Provided, however, that the Participant's retirement benefits
under the Plan on and after January 1, 2003 shall not be less than the
Accrued Deferred Monthly Retirement Income Commencing at Normal
Retirement Date that the Participant has accrued as of December 31,
2002 using 'Final Average Monthly Compensation' determined as of such
date without regard to clause (b) of the preceding sentence.
Notwithstanding any provision of this Section 1.1(A)(15) to the
contrary, for purposes of determining a Participant's average monthly
rate of Compensation on or after April 1, 2007, the Participant's
Compensation for a calendar year shall not include the portion of any
bonus, aggregated bonuses, or sales commissions paid in such calendar
year which exceeds 25% of the Participant's total base pay in the
calendar year, for years after 2006. Provided, however, that the
Participant's benefits under the Plan on and after April 1, 2007 shall
not be less than the Accrued Deferred Monthly Retirement Income
Commencing at Normal Retirement Date that the Participant has accrued
as of March 31, 2007 using "Final Average Monthly Compensation"
determined as of such date.
(16) "Highly Compensated Employee" shall mean any "highly compensated
active employee" or "highly compensated former employee."
(a) A "highly compensated active employee" includes any employee who
performs service for an Employer or Controlled Group Member
during the determination year and who, during the look-back year,
received compensation from the Employer or Controlled Group
Member in excess of $80,000 (as adjusted pursuant to Section
415(d) of the Internal Revenue Code) and was a member of the
top-paid group for such year. The term "highly compensated active
employee" also includes an employee who is a "5-percent owner"
(within the meaning of Section 414(q) of the Internal Revenue
Code) any time during the look-back year or the determination
year. An employee is in the "top-paid group" for a year if such
employee is in the group consisting of the top 20% of the
employees of all Controlled Group Members when ranked on the
basis of compensation paid during such year.
The "determination year" shall be the Plan Year and the "look-back
year" shall be the twelve-month period immediately preceding the
determination year. The calendar year which begins with or within the
look-back year shall be treated as the look-back year for purposes of
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determining whether an employee is a highly compensated employee on
account of the employee's compensation for a look-back year under
Section 414(q)(1)(B) of the Internal Revenue Code.
(b) A "highly compensated former employee" includes any employee who
separated from service (or was deemed to have separated) prior to
the determination year, performs no service for the Employer or a
Controlled Group Member 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.
(c) The determination of who is a Highly Compensated Employee,
including the determinations of the number and identity of
employees in the top-paid group and the compensation that is
considered, shall be made in accordance with Section 414(q) of
the Internal Revenue Code and regulations thereunder. The method
of determination set forth above in this Section shall apply to
all plans (both retirement and nonretirement) of the Employer for
which the definition of "highly compensated employee" is
applicable.
(17) "Hour of Service" shall mean each hour for which an employee is
directly or indirectly paid, or is entitled to payment, by the
Employer (including any predecessor business of an Employer conducted
as a corporation, partnership or proprietorship) for (a) the
performance of duties or (b) reasons other than the performance of
duties, including but not limited to vacation, holidays, sickness,
disability, paid layoff and similar paid periods of nonworking time.
Such Hours of Service shall be credited to the employee for the period
in which such duties were performed or in which occurred the period
during which no duties were performed. An Hour of Service also
includes each hour, not credited above, for which backpay,
irrespective of mitigation of damages, has been either awarded or
agreed to by the Employer. These Hours of Service shall be credited to
the employee for the period to which the award or agreement pertains.
The number of Hours of Service to be credited to an employee for any
period shall be governed by Sections 2530.200b-2(b) and 2530.200b-2(c)
of Part 2530 of Subchapter C of Chapter XXV of Title 29 of the Code of
Federal Regulations (Department of Labor regulations relating to
minimum standards for employee pension benefit plans).
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(18) "Initial Vesting Date" shall mean the earlier to occur of the
following dates:
(a) the date on which the Participant has completed five years of
Vesting Service;
or
(b) the date on which the Participant attains his Normal Retirement
Age;
provided, however, that the provisions of Section 4.6 hereof shall
apply in determining the Initial Vesting Date of a Participant who has
accrued Vesting Service during any Plan Year that the Plan is
top-heavy; and provided further that the Initial Vesting Date of a
Participant shall not be earlier than the Effective Date of the Plan.
(19) "Internal Revenue Code" shall mean the Internal Revenue Code of 1986,
as amended from time to time.
(20) "IRC 414(l) Single Plan" shall mean a "single plan" within the meaning
of Section 414(l) of the Internal Revenue Code and regulations issued
pursuant thereto.
(21) "Last Date of Commencement of Service" shall mean:
(a) if the employee's service has not been previously terminated in
accordance with the provisions hereof, the date on which he first
performs an Hour of Service; or
(b) if the employee's service has been previously terminated in
accordance with the provisions hereof, the first day following
his last termination of service on which he performs an Hour of
Service;
provided, however, that the provisions of Section 1.4(A) hereof shall
apply in determining the Last Date of Commencement of Service of any
employee whose service is terminated and who is reemployed on or after
the Effective Date of the Plan and prior to his incurring a Break in
Service.
An Employer may at the time of its initial adoption of the Plan
provide, with respect to all or any specified classification of its
employees, that the Last Date of Commencement of Service for purposes
of determining the Credited Service and Vesting Service of such
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employees shall not be earlier than a specified date, which is later
than the otherwise applicable date described above but is not later
than the date as of which the Plan first became effective with respect
to such Employer, and may provide that such specified date will be
different for the purposes of determining the eligibility to
participate in the Plan, the Credited Service and the Vesting Service
of such employees; provided, however, that the date established to
determine the Vesting Service of such employees shall not be later
than the date as of which such Employer became a Controlled Group
Member of any other Employer maintaining the Plan or Superseded Plan
or, if later, the date as of which the Plan or Superseded Plan first
became effective with respect to such other Employer.
The Last Date of Commencement of Service of an employee by a
predecessor or acquired business shall not be earlier than the date of
such merger or acquisition unless the Employer provides that a
uniformly applied earlier date or dates will be used for the purposes
of the Plan.
(22) "Monthly Covered Compensation" shall be equal to one-twelfth of the
"covered compensation," within the meaning of Section 401(l)(5)(E) of
the Internal Revenue Code and regulations and rulings issued pursuant
thereto, that applies to the Participant during any specified Plan
Year based upon his year of birth. The amount of Monthly Covered
Compensation shall be automatically adjusted each Plan Year; provided,
however, that any changes in the amount of "covered compensation" that
become effective after the first day of the Plan Year during which the
date of the Participant's retirement or termination of service occurs
shall be ignored.
(23) "Normal Retirement Age" shall mean the older of:
(a) age 65 years; or
(b) the Participant's age on the fifth anniversary of the date of
commencement of his Vesting Service.
(24) "Normal Retirement Date" shall have the meaning assigned in Section
2.1 hereof.
(25) "Participant" shall mean:
(a) any active Employee who has satisfied the requirements of Section
1.2 hereof;
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(b) any former Employee who has satisfied the requirements of Section
1.2 hereof, whose service has not been terminated but who has
subsequently been transferred from his status as an eligible
Employee as described in Section 1.5 hereof; and
(c) any retired or terminated Employee who has vested rights to
benefits under the provisions of the Plan.
(26) "Plan" shall mean the Retirement Plan for Employees of Capital
Southwest Corporation and Its Affiliates, as amended and restated
effective as of April 1, 2006, as set forth in this document and as it
may hereafter be amended from time to time.
(27) "Plan Year" shall mean the calendar, policy or fiscal year on which
the records of the Plan are kept as reported from time to time by the
plan administrator to the Internal Revenue Service. The Plan Year,
unless subsequently changed in accordance with rules or regulations
issued by the Internal Revenue Service or Department of Labor, shall
be the 12-month period beginning April 1 of each calendar year.
(28) "Post Payment Recalculation Date" shall have the meaning assigned in
Section 2.1(D) hereof.
(29) "Qualified Joint and Survivor Annuity" means an annuity that (a) is
payable for the life of the Participant with a survivor annuity
payable for the life of his spouse which is not less than 50% and is
not greater than 100% of the amount of the annuity which is payable
during the joint lives of the Participant and his spouse and (b) is
the actuarial equivalent of the monthly retirement income payable to
the Participant for life under the provisions of the Plan.
(30) "Qualified Joint and 50% Survivor Annuity Option" shall have the
meaning assigned in Section 3.1 hereof.
(31) "Qualified Preretirement Survivor Annuity" shall mean the minimum
death benefit, if any, described in Section 4.1(D) hereof that may be
payable to the spouse of a Participant who dies prior to his Annuity
Starting Date.
(32) "Required Beginning Date" shall have the meaning assigned in Section
401(a)(9) of the Internal Revenue Code and shall mean the later of:
(a) April 1 of the calendar year that next follows the calendar year
in which the Participant attains or will attain the age of 70 1/2
years; or
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(b) April 1 of the calendar year that next follows the calendar year
in which he retires or his service is terminated;
provided, however, that the Required Beginning Date of any Participant
who is a 5-percent owner (within the meaning of Section 416 of the
Internal Revenue Code) with respect to the Plan Year ending in the
calendar year in which the Participant attains age 70 1/2 shall not be
later than April 1 of the calendar year that next follows the calendar
year in which he attains or will attain the age of 70 1/2 years.
For purposes of this Section 1.1(A)(32), a Participant is treated as a
5-percent owner after December 31, 1996, if such Participant is a
5-percent owner, as defined in Section 416 of the Internal Revenue
Code, with respect to the Plan Year ending in the calendar year in
which the Participant attains age 70 1/2.
(33) "Sponsoring Employer" shall mean Capital Southwest Corporation, a
Texas corporation, and its successor or successors.
(34) "Superseded Plan" shall mean, collectively or distributively, as the
context may indicate, the qualified retirement plan, if any, that was
maintained by an Employer for its eligible employees prior to the
Effective Date of the Plan and that the Plan represents an amendment
and restatement thereof. References to the Superseded Plan as of any
given date shall refer to the provisions as set forth under the terms
of the applicable document describing such qualified retirement plan
as amended and in effect on such given date prior to the Effective
Date of the Plan.
(35) "Supplement" shall mean any supplement that is attached to and made a
part of the Plan and that describes provisions of the Plan that apply
only to employees of an Employer or Employers specified in such
Supplement. The term "Supplement" shall specifically include, but not
be limited to, the First Supplement to Retirement Plan for Employees
of Capital Southwest Corporation and Its Affiliates, as amended and
restated effective April 1, 1989, which was attached to the Superseded
Plan and shall be attached to the Plan as of April 1, 2006.
(36) "Trust" and "Trust Fund" shall mean the trust fund established
pursuant to the terms of the Trust Agreement.
(37) "Trust Agreement" shall mean the Retirement Trust for Employees of
Capital Southwest Corporation and Its Affiliates, as amended and
restated effective as of April 1, 1989, as set forth in the trust
agreement of that title, and as such trust agreement may be amended
from time to time.
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(38) "Trustee" shall mean the corporate trustee or trustees or the
individual trustee or trustees, as the case may be, appointed from
time to time pursuant to the provisions of the Trust Agreement to
administer the Trust Fund maintained for the purposes of the Plan.
(39) "Vested Percentage" shall mean the percentage specified in Section
2.4(A)(1) hereof in which the Participant has a nonforfeitable right
to his accrued benefit attributable to Employer contributions, based
upon his number of years of Vesting Service and his age as of the date
that such percentage is being determined; provided, however, that the
Vested Percentage of a Participant who has accrued Vesting Service
during any Plan Year that the Plan is top-heavy shall be subject to
the provisions of Section 4.6 hereof.
(40) "Vesting Service" shall mean the total period of elapsed time,
computed in years and days, during the period beginning on the
employee's Last Date of Commencement of Service, and ending on his
date of retirement or termination of service, or, where applicable,
ending on such other date as is specified hereunder; provided,
however, that:
(a) the first 12 months of any continuous absence during such period
will be included in the employee's Vesting Service but the
portion, if any, of such absence that is in excess of 12 months
will be excluded from his Vesting Service, except that any period
of such absence that is included in his Credited Service will
also be included in his Vesting Service;
(b) the provisions of Section 1.3 hereof shall apply in the case of
an employee who has a maternity or paternity absence, the
provisions of Section 1.4 hereof shall apply in the case of an
employee who is reemployed with a reinstatement of Vesting
Service accrued prior to his Last Date of Commencement of
Service, the provisions of Section 1.5 hereof shall apply in the
case of an employee who is transferred to or from his status as
an eligible Employee and the provisions of Section 1.6 hereof
shall apply in the case of an employee who has previously been
employed as a leased employee;
and
(c) with respect to any Participant in the Plan whose Last Date of
Commencement of Service is prior to the Effective Date of the
Plan and who was a participant in the Superseded Plan as in
effect on the day immediately preceding the Effective Date of the
1-19
Plan, the Vesting Service that he has accrued under the Plan as
of the Effective Date of the Plan shall not be less than the
service that he had accrued for the purposes of determining his
nonforfeitable right as of such date to the portion of his
accrued benefit attributable to employer contributions under the
terms of the Superseded Plan as in effect on the day immediately
preceding the Effective Date of the Plan.
(B) The terms "actuarially equivalent," "equivalent actuarial value,"
"actuarial equivalent" and similar terms as used herein mean equality in value
of the aggregate amounts expected to be received under different forms of
payment based upon the same mortality and interest rate assumptions, which shall
be determined as follows.
(1) Unless specifically provided otherwise under the provisions
hereof, the mortality and interest rate assumptions used in
computing benefits payable on behalf of a Participant upon his
retirement or termination of employment and upon the exercise of
optional forms of retirement income under the Plan shall be as
follows:
(a) the mortality assumptions shall be based upon the "Unisex
Pension Mortality Table Projected to 1984" (UP-1984
Mortality Table); and
(b) the interest rate assumption shall be 6%;
provided, however, that for the purposes of determining the
maximum retirement income permitted under the provisions of
Section 415 of the Internal Revenue Code, the mortality and
interest rate assumptions used to determine actuarial equivalence
for early retirement shall be the assumptions that would produce
the early retirement adjustment factors that apply under the
provisions hereof in the event of early retirement.
(2) Any provisions of Subsection (1) above to the contrary
notwithstanding, if payment is in a form of distribution which is
subject to Section 417(e)(3) of the Internal Revenue Code, which
shall include lump-sum distributions and other forms of
distribution that provide payments in the form of a decreasing
annuity or that provide payments that may be for a period less
than the life of the recipient, (an "IRC Section 417(e)(3) form
of distribution") the amount of any such IRC Section 417(e)(3)
form of distribution to a Participant shall be equal to the
actuarial equivalent of the Participant's "accrued benefit"
(within the meaning of Section 411(a)(7) of the Internal Revenue
1-20
Code and regulations issued with respect thereto) commencing at
his Normal Retirement Age or the date of termination of his
service, whichever is later, determined using:
(a) the "applicable mortality table" prescribed by the Secretary
of Treasury pursuant to Section 417(e)(3) of the Internal
Revenue Code (which as of April 1, 2006, is based upon a
fixed blend of 50% of the unloaded male mortality rates and
50% of the unloaded female mortality rates underlying the
mortality rates in the 1994 Group Annuity Reserving Table,
projected to 2002); and
(b) the annual rate of interest on 30-year Treasury securities
for the second full calendar month immediately preceding the
first day of the Plan Year during which the Annuity Starting
Date occurs.
(3) For the purposes of Subsection (2) above, a joint and survivor
annuity form of payment which may decrease upon the death of the
Participant or his joint pensioner shall be deemed to be a
non-decreasing annuity.
(C) The term "single-sum value" as used herein shall mean the actuarially
computed present value, as of a given date, of the retirement income payments
for which it is determined based upon the interest and mortality assumptions
specified in the provisions of the Plan. Unless specifically provided otherwise
under the provisions hereof, the single-sum value as of a given date of a
Participant's accrued benefit that is scheduled to commence at a later date
shall be discounted for both interest and mortality from such scheduled
commencement date to such given date.
(D)The terms "herein", "hereof", "hereunder" and similar terms refer to
this document, including the Trust Agreement of which this document is a part,
unless otherwise qualified by the context.
(E)The pronouns "he", "him" and "his" used in the Plan shall also refer to
similar pronouns of the feminine gender unless otherwise qualified by the
context.
1-21
1.2 - PARTICIPATION
(A) Continuation of Participation of Superseded Plan Participants: Each
person who was a participant in the Superseded Plan, if any, of the Employer as
of the day immediately preceding the Effective Date of the Plan will become a
Participant in the Plan on the Effective Date of the Plan; provided, however,
that any such Participant who had retired or whose service had been terminated
prior to the Effective Date of the Plan and who is not an active employee of an
Employer or in the employment of a Designated Nonparticipating Employer or on a
leave of absence granted by an Employer or Designated Nonparticipating Employer
as of the Effective Date of the Plan shall be entitled on and after the
Effective Date of the Plan to only those benefits, if any, to which he is
entitled on and after the Effective Date of the Plan under the provisions of the
Superseded Plan, and he and his Beneficiaries shall not be entitled to any
additional benefits under the Plan as set forth herein unless he reenters the
service of an Employer and becomes an Employee after the Effective Date of the
Plan or unless the Plan is amended on or after the Effective Date of the Plan
specifically to provide otherwise; provided, however, that if the benefits that
are payable on behalf of any such Participant under the provisions of the
Superseded Plan require modification to permit benefits to be paid to specified
individuals other than the Participant in order to comply with any qualified
domestic relations order under Section 414(p) of the Internal Revenue Code, or
to comply with any other provisions of said Code, the terms and benefits of the
Superseded Plan will be considered to have been modified with respect to the
Participant affected to the extent necessary to comply with such provisions of
said Code.
(B) Participation of Other Employees: Each Employee who does not become a
Participant in accordance with the provisions of Section 1.2(A) above and who is
in the service of the Employer on or after the Effective Date of the Plan will
become a Participant in the Plan on the latest to occur of the following dates:
(1) the date on which he attains the age of 21 years;
(2) the date that immediately follows the first Eligibility
Computation Period (as defined below) during which he completes
at least 1,000 Hours of Service;
or
1-22
(3) the Effective Date of the Plan;
provided, however, that any such Employee whose service has not been terminated
but who is absent from the active service of the Employer on such date that he
is first eligible to become a Participant in the Plan as described above will
become a Participant hereunder as of the date of his return to active service
with the Employer.
(C) Participation Following Reemployment: The above provisions of this
Section 1.2 describe the date on which an eligible Employee will initially
become a Participant in the Plan. In the event that an Employee's service is
terminated and he subsequently reenters the service of the Employer, the date on
or after the date of his reentry as of which he will become a Participant in the
Plan is subject to the provisions of Section 1.4 hereof.
1.3 - LEAVE OF ABSENCE AND TERMINATION OF SERVICE
Any absence from the active service of the Employer by reason of an
approved absence granted by the Employer because of accident, illness, layoff
with the right of recall, or for any other reason on the basis of a uniform
policy applied by the Employer without discrimination, will be considered a
leave of absence for the purposes of the Plan and will not terminate an
employee's service provided he returns to the active service of the Employer at
or prior to the expiration of his leave or, if not specified therein, within the
period of time which accords with the Employer's policy with respect to
permitted absences.
Absence from the active service of the Employer because of engagement in
military service will not terminate the service of an employee and will be
treated under the Plan as a leave of absence granted by the Employer if (1) he
is entitled under the Uniformed Services Employment and Reemployment Rights Act
of 1994 ("USERRA") to reemployment by the Employer upon his discharge from
active duty, and (2) he returns to the active service of the Employer within the
period of time during which he has reemployment rights under USERRA. The
following special provisions, which are intended to comply with Section 414(u)
of the Internal Revenue Code, shall apply to an employee of an Employer who
1-23
returns to active service in accordance with the reemployment provisions of
USERRA following a period of qualifying military service (as determined under
USERRA):
(A) Each period of qualifying military service served by an employee
shall, upon such reemployment, be counted toward determining the
employee's service with the Employer for all purposes of the
Plan, including determining the amount of a Participant's Accrued
Deferred Monthly Retirement Income Commencing at Normal
Retirement Date and the Vested Percentage in his Accrued Deferred
Monthly Retirement Income Commencing at Normal Retirement Date.
(B) For all purposes under the Plan, a Participant shall be treated
as having received Compensation from the Employer based on the
rate of Compensation the Participant would have received during
the period of qualifying military service, or if that rate is not
reasonably certain, on the basis of the Participant's average
rate of Compensation during the 12-month period immediately
preceding such period.
(C) With respect to any Employer contribution made in accordance with
the foregoing provisions of this paragraph:
(i) such contribution shall not be subject to any otherwise
applicable limitation under Sections 404(a) or 415 of the
Internal Revenue Code, and shall not be taken in account in
applying such limitations to other Participant or Employer
contributions under the Plan or any other plan, with respect
to the year in which such contribution is made, and such
contribution shall be subject to these limitations only with
respect to the year to which such contribution relates and
only in accordance with regulations prescribed by the
Internal Revenue Service; and
(ii) the Plan shall not be treated as failing to meet the
requirements of Sections 401(a)(4), 401(a)(26), 410(b), or
416 of the Internal Revenue Code by reason of such
contribution.
If the employee does not return to the active service of the Employer at or
prior to the expiration of his leave of absence as above defined, his service
will be considered terminated as of the earliest to occur of (i) the date on
which his leave of absence expired, (ii) the first anniversary of the date on
which his leave of absence began or (iii) the date of his resignation, quit,
discharge or death; provided, however, that if any such employee, who was a
participant in the Plan or Superseded Plan on the date on which his leave began,
1-24
is prevented from his timely return to the active service of the Employer
because of his total and permanent disability or because of his death, he shall
be treated as though he returned to active service immediately preceding his
total and permanent disability or his death, except that:
(1) if he becomes totally and permanently disabled prior to his
Normal Retirement Date while he is on a leave of absence due to
military service, Section 2.4(A) hereof shall be used, in lieu of
Section 2.3, to determine the benefit (which shall be determined
as though his Initial Vesting Date has occurred prior to the date
of termination of his service and assuming that his Vested
Percentage is 100%), if any, that is payable on his behalf, but
such benefit will be payable only if a benefit would have been
payable on his behalf under the provisions of Section 2.3 hereof
if he had been in the service of the Employer on the date of his
total and permanent disability; or
(2) if his death occurs while he is on a leave of absence due to
military service, Subsection (b) of Section 2.4(B)(1) shall not
apply in determining the amount of the death benefit, if any,
that is payable on his behalf.
If an employee has an absence from the service of the Employer which begins
on or after April 1, 1985 and is due to the pregnancy of the employee, the birth
of a child of the employee or the placement of a child with the employee in
connection with the adoption of such child by such employee or is for the
purpose of caring for such child for a period beginning immediately following
such birth or placement (hereinafter referred to in this paragraph as a
"maternity or paternity absence"), the rights of such employee under the Plan
shall not be less favorable to the employee than those rights that he would have
had if he had been granted a one-year leave of absence beginning on the date on
which his maternity or paternity absence began. If the length of such maternity
or paternity absence extends beyond the first anniversary of the date on which
such absence began and the service of such employee is terminated during such
maternity or paternity absence, the date of termination of service of such
employee for purposes of determining his accrued Vesting Service shall be deemed
to be the first anniversary of the date on which such absence began and the
rights of such employee under Section 1.4 hereof to resume participation in the
1-25
Plan and to a reinstatement of his previous Credited Service and Vesting Service
upon his reemployment shall not be less favorable to the employee than those
corresponding rights that he would have under such section if the date of
termination of his service had been the second anniversary of the date on which
his maternity or paternity absence began and if the length of such employee's
Break in Service were based on that termination date.
In the event that an employee's service with the Employer is interrupted
because of any absence from the active service of the Employer which is not
deemed a leave of absence as defined above, his service will be considered
terminated as of the date of his retirement, quit, discharge, resignation or
death or, if earlier, as of the first anniversary of the date of such
interruption for any other reason.
Transfers of an employee's service among the Employers and Designated
Nonparticipating Employers shall not be deemed interruptions of his service and
shall not constitute a termination of service for the purposes of the Plan.
1.4 - REEMPLOYMENT
(A) Reemployment Prior to Incurring a Break in Service: If any employee,
whose service is terminated on or after the Effective Date of the Plan, reenters
the active service of the Employer and performs an Hour of Service within the
12-month period immediately following the date of termination of his service, he
shall not incur a Break in Service, and his Last Date of Commencement of Service
shall be determined as though his service had not previously been terminated. On
and after such reentry, any such employee shall be treated under the Plan as
though he had been on an unpaid leave of absence granted by the Employer during
the period between such date that his service was previously terminated and such
date of reentry. However, if any such employee was entitled to a benefit under
Section 2.1, 2.2, 2.3 or 2.4(A) hereof prior to his reentry, his rights under
the Plan on and after his date of reentry shall be determined under Section
1.4(B), 1.4(C), 1.4(D) or 1.4(E) below, whichever is applicable, except that his
1-26
reinstated Vesting Service shall not be less than that determined under the
above provisions of this Section 1.4(A).
(B) Reemployment of Vested Terminated Participant Prior to Commencement of
Payments: If a Participant's service is terminated on or after his Initial
Vesting Date for a reason other than his normal retirement, early retirement or
disability retirement as described in Sections 2.1, 2.2 and 2.3 hereof,
respectively, and he subsequently reenters the active service of the Employer
prior to his Annuity Starting Date, he will become a Participant upon the date
of such reentry and will be entitled to a reinstatement of the Vesting Service
and Credited Service that he had accrued on the date of termination of his
service in lieu of the benefits to which he was entitled under the Plan prior to
his reentry; provided, however, that such Participant's Accrued Deferred Monthly
Retirement Income Commencing at Normal Retirement Date (or his accrued monthly
normal retirement income, if applicable) determined as of any given date after
the date of his reentry shall be reduced on an actuarially equivalent basis, if
applicable, to take into account any death benefit coverage that was in effect
under Section 2.4(A) hereof after the date of termination of his service and
prior to the date of his reentry; and provided further, however, that the
benefit payable to such Participant upon his subsequent retirement or
termination of service shall not be less than the benefit that he would have
been entitled to receive under the provisions of Section 2.4(A) hereof if he had
not reentered the service of the Employer.
(C) Reemployment of Retired or Vested Terminated Participant After
Commencement of Payments:
(1) If a Participant, whose service is terminated on or after the Effective
Date of the Plan and who has received a portion but not all of the retirement
income to which he is entitled under the provisions of Section 2.1, 2.2 or
2.4(A)(1) hereof, subsequently reenters the active service of the Employer on or
after his Annuity Starting Date, he shall become a Participant upon the date of
such reentry and the following provisions shall apply.
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(a) If the date of his reentry is prior to his Required
Beginning Date, subject to the provisions of Sections
1.4(C)(2) and 2.1(D) hereof, no retirement income payments
shall be made during the period of such reemployment. Upon
the subsequent retirement or termination of service of such
a Participant, his benefit under the Plan shall be
determined in the same manner as that of a vested terminated
Participant whose retirement income payments have not
commenced and who subsequently reenters the service of the
Employer as described in Section 1.4(B) above, except that
the benefit payable under the Plan to or on behalf of such
Participant upon his subsequent retirement or termination of
service shall be reduced on an actuarially equivalent basis
by an amount equal to the sum of the retirement income and
other benefit payments that he received under the provisions
of Section 2.1, 2.2, 2.4(A) or 3.1 hereof, whichever is
applicable, prior to such reentry into the service of the
Employer; provided, however, that the amount of such monthly
retirement income that is payable to him upon his subsequent
retirement or termination of service shall not be less than
the actuarial equivalent of a monthly retirement income
payable to him at that time as a straight life annuity in an
amount equal to the amount of the monthly retirement income
that was payable to him as a straight life annuity
immediately prior to his reentry. (If the retirement income
payable to the Participant immediately prior to his reentry
was not payable as a straight life annuity, the amount that
was payable to him as a straight life annuity immediately
prior to his reentry shall be determined by converting the
income that was payable to him immediately prior to his
reentry to its actuarial equivalent payable as a straight
life annuity). If any such Participant reenters the active
service of the Employer on or after his Normal Retirement
Date, the monthly retirement income payable on behalf of
such Participant in accordance with the provisions of
Section 2.1 upon his subsequent retirement shall not be less
than the amount that can be provided on an actuarially
equivalent basis by the single-sum value required, as of
such date of reentry, to provide the retirement income that
otherwise would have been payable on his behalf after such
date of reentry, accumulated with interest from such date of
reentry to the date of his subsequent retirement or
termination of service.
(b) If the date of his reentry is on or after his Required
Beginning Date, he shall continue to receive the benefits to
which he is entitled on and after such date, and any future
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benefits that he accrues after his Required Beginning Date
shall be determined in accordance with the provisions of
Section 411(b)(1)(H) of the Internal Revenue Code and
regulations issued with respect thereto in a manner similar
to that described in Section 2.1(D) hereof.
(2) In lieu of having his retirement income payments discontinued and his
benefit payable upon his subsequent retirement or termination determined in
accordance with the provisions of Section 1.4(C)(1) above, any such Participant,
whose Vested Percentage at the date of his retirement or termination of service
was 100%, who is receiving retirement income payments under the Plan and who
reenters the active service of the Employer on less than a full-time basis, may
upon such reentry elect in writing filed with the Committee to continue to
receive his retirement income payments after his reemployment in the same manner
as though he had not reentered the service of the Employer. Any such Participant
whose retirement income payments are continued in accordance with the provisions
above shall be treated as if he then first entered the service of the Employer
except that:
(a) upon the date after his reentry that he satisfies the
requirements to become a Participant in the Plan, he shall
become a Participant, retroactively, as of the date of his
reentry; provided, however, if either (i) the date of his
reentry is during the Plan Year in which the date of his
retirement or termination of service occurred and he is
credited with at least 501 Hours of Service during such Plan
Year or (ii) the date of his reentry is during the Plan Year
next following the Plan Year in which the date of his
retirement or termination of service occurred and he is
credited with at least 501 Hours of Service during both the
Plan Year in which the date of his retirement or termination
of service occurred and the next following Plan Year, he
shall, upon the date of his reentry or upon such later date
that such Hours of Service requirement has been satisfied,
become a Participant, retroactively if applicable, as of the
date of his reentry;
(b) upon his becoming a Participant, he shall be entitled to a
reinstatement of the Vesting Service that he had accrued as
of the date of his previous retirement or termination of
service; and
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(c) he shall not accrue any additional Credited Service during
any "reemployment benefit accrual computation period" that
he is credited with less than 1,000 Hours of Service. The
"reemployment benefit accrual computation period" of any
such Participant shall mean the 12-month period beginning on
the date of his reentry and on each anniversary of such
date.
The benefit which any such Participant accrues after the date of his reentry
(including any disability retirement or death benefit payable on his behalf),
which is payable to such Participant or his Beneficiary upon his subsequent
retirement or termination of service, shall be limited to the amount that can be
provided by the actuarial equivalent of the monthly retirement income, if any,
that he accrues subsequent to such date of reentry based upon his Credited
Service and Final Average Monthly Compensation determined in the same manner as
though he then first entered the service of the Employer on the date on or after
his reentry that he commences to accrue additional Credited Service; provided,
however, that such income that such a Participant accrues subsequent to his date
of reentry shall not cause the actuarial equivalent of the total income payable
on behalf of the Participant under the Plan to exceed the amount that would have
been payable if he had not elected to continue to receive his retirement income
after his reemployment and if the Credited Service that he accrues after his
reentry were restricted as provided under (c) above. The retirement income that
is continued during the period of reemployment of any such Participant who is
reemployed on less than a full-time basis shall be discontinued if the
Participant is employed on a full-time basis at any time after his reentry. If
the retirement income of any such Participant is subsequently discontinued, his
benefit under the Plan shall be determined under this Section 1.4(C) (and not
under Section 1.4(A) above) as though his service had been terminated on the
date that his retirement income was discontinued and as though he had reentered
the service of the Employer immediately thereafter.
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(D) Reemployment After Disability Retirement: If a Participant, who has
retired on or after the Effective Date of the Plan under the provisions of
Section 2.3 and who has not prior to his reentry received the full actuarially
equivalent value of the disability retirement income to which he was entitled
under Section 2.3 hereof, recovers from disability and reenters the active
service of the Employer within one year after the date of his recovery from
disability by accepting reemployment offered by the Employer within 30 days
after such offer, his service will be deemed to have been continuous and he will
be treated under the Plan in the same manner as though he had received
Compensation, at the rate he was receiving at the time of his disability, during
the period that he was considered totally and permanently disabled as provided
herein.
(E) Reemployment After Full Settlement: If a Participant's service has been
terminated on or after the Effective Date of the Plan for any reason and he was
entitled, upon such termination, to a monthly retirement income under the
provisions of Section 2.1, 2.2, 2.3 or 2.4(A)(1) hereof and he reenters the
active service of the Employer after the full actuarially equivalent value of
such retirement income has been paid on his behalf, he shall become a
Participant on the date of his reentry and shall be entitled to a reinstatement
of the Vesting Service and Credited Service that he had accrued as of such
previous date of termination, but the benefit payable under the Plan to or on
behalf of such Participant upon his subsequent retirement or termination of
service shall be reduced by the actuarial equivalent of such retirement income
that has been previously paid on his behalf (where the amount of such
actuarially equivalent reduction shall be determined using the same mortality
and interest assumptions that were used to calculate such benefit previously
paid on his behalf).
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(F) Reemployment of Other Employees: Any other former employee who is not
included under the provisions of Section 1.4(A), 1.4(B), 1.4(C), 1.4(D) or
1.4(E) above and who subsequently reenters the active service of the Employer
following his termination of service will be treated as though he then first
entered the service of the Employer; provided, however, that:
(1) with respect to any such employee in the service of the Employer on or
after the Effective Date of the Plan whose service is or was
terminated on or after April 1, 1976 and who incurred a Break in
Service prior to the date of his reentry, the following special
provisions shall apply:
(a) if such employee had completed five or more years of Vesting
Service as of the date of termination of his service or if the
number of years and days included in his Break in Service is less
than either five years or the number of years and days of his
Vesting Service that he had accrued as of the date of termination
of his service, such employee shall be entitled, upon the date as
of which he becomes a Participant in the Plan, to a reinstatement
of the Credited Service and Vesting Service that he had accrued
as of such previous date of termination of service;
(b) if such employee was a Participant in the Plan or Superseded Plan
as of the date of termination of his service and he is entitled
to a reinstatement of his previous Credited Service and Vesting
Service under (a) above, he shall become a Participant in the
Plan as of the date of his reentry or the Effective Date of the
Plan, whichever is later; and
(c) if such employee was not a Participant in the Plan as of the date
of termination of his service but he is entitled to a
reinstatement of his previous Credited Service and Vesting
Service under (a) above or if such employee (regardless of
whether or not he was a Participant in the Plan as of the date of
termination of his service) reenters the service of the Employer
prior to the elapse of five full Plan Years following the date of
termination of his service, the date on which he will be eligible
to become a Participant in the Plan following his date of reentry
shall not be later than the date on which he would have been
eligible to become a Participant if he had been on a leave of
absence during the period between the date of his previous
termination of service and the date of his reentry; and
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(2) with respect to any such employee whose service was terminated prior
to the Effective Date of the Plan (while the Superseded Plan was in
effect with respect to the Employer by which he was employed at the
date of termination of his service) and who had reentered the active
service of the Employer prior to the Effective Date of the Plan or who
reenters the active service of the Employer on or after the Effective
Date of the Plan, his rights under the Plan with respect to the period
of his service prior to such date of reentry into the service of the
Employer shall be determined under the applicable provisions of the
Superseded Plan as in effect on the date of his prior termination of
service; provided, however, if any such employee, whose service was
terminated prior to April 1, 1985 and whose next succeeding date of
reentry into the service of the Employer is on or after the Effective
Date of the Plan, would have been entitled under the provisions of the
Superseded Plan to a reinstatement of the service used to determine
his nonforfeitable right to benefits if he had reentered the service
of the Employer on April 1, 1985, the rights upon such reentry of any
such employee shall not be less favorable to the employee than the
corresponding rights of an employee whose service is terminated on or
after the Effective Date of the Plan as described above.
(G) Reemployment of Employee Who Does Not Qualify as an "Employee": The
rights of any terminated employee of the Employer who was not an Employee as
defined herein on the date of termination of his service and who is reemployed
in a status in which he qualifies as an Employee as defined herein shall be
determined in accordance with the provisions of the Plan as though he had been
an Employee as defined herein on the date of termination of his service. The
rights of any terminated employee of an Employer who is reemployed by the
Employer in a status in which he does not qualify as an Employee as defined
herein shall be determined in accordance with the provisions of the Plan as
though he had been reemployed by the Employer as an Employee as defined herein
and had immediately thereafter been transferred from his status as an Employee
as defined herein. A Participant shall not accrue any benefits under the Plan or
Superseded Plan solely because of the assumption that he was an Employee as
defined herein on the date of termination of his service or the date of his
reemployment, as the case may be.
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(H) Employment of Terminated Employee of Designated Nonparticipating
Employer by an Employer and Employment of Terminated Employee of Employer by
Designated Nonparticipating Employer: The rights of any terminated employee of a
Designated Nonparticipating Employer who was not an Employee as defined herein
on the date of termination of his service and who is subsequently employed by an
Employer in a status in which he qualifies as an Employee as defined herein
shall be determined in accordance with the provisions of the Plan as though he
had been an Employee as defined herein on the date of termination of his
service. The rights of any terminated Employee of an Employer who is
subsequently employed by a Designated Nonparticipating Employer shall be
determined in accordance with the provisions of the Plan as though he had been
reemployed by the Employer as an Employee as defined herein and had immediately
thereafter been transferred to such Designated Nonparticipating Employer. A
Participant shall not accrue any benefits under the Plan or Superseded Plan
solely because of the assumption that he was an Employee as defined herein on
the date of termination of his service or the date of his employment, as the
case may be, with a Designated Nonparticipating Employer.
(I) Employment with Former Employer or Former Designated Nonparticipating
Employer: In determining the rights under the Plan of any employee who was
previously employed (either before, on or after the Effective Date of the Plan)
by an employer, which was formerly an Employer participating in the Plan or
Superseded Plan or was formerly a Designated Nonparticipating Employer but which
is not currently an Employer or Designated Nonparticipating Employer, the period
of such employee's employment with such employer while it was an Employer or
Designated Nonparticipating Employer, as the case may be, shall be recognized in
determining the Vesting Service of such employee in the same manner as though
such employment during such period had been with a current Employer or
Designated Nonparticipating Employer, but any period of employment with such
1-34
employer after the date that it ceased to be an Employer or Designated
Nonparticipating Employer shall not be recognized and his service shall be
deemed to have been terminated during such period that such employer is not an
Employer or Designated Nonparticipating Employer.
1.5 - TRANSFER TO OR FROM STATUS AS AN ELIGIBLE EMPLOYEE
An employee will be deemed to be transferred from his status as an eligible
Employee in the event that he remains in the service of the Employer but has a
change in his employee status so that he no longer qualifies as an Employee as
defined herein or in the event that he is transferred to and becomes an employee
of a Designated Nonparticipating Employer. Conversely, an employee of an
Employer who is not an Employee as defined herein will be deemed to be
transferred to the status of an eligible Employee in the event that he remains
in the service of the Employers but has a change in his employee status so that
he becomes an Employee as defined herein, and an employee of a Designated
Nonparticipating Employer will be deemed to be transferred to the status of an
eligible Employee in the event that he is transferred to an Employer from such
Designated Nonparticipating Employer and becomes an Employee as defined herein.
The service of such a person described above shall not be considered to be
interrupted by reason of any such transfer, and service with the Designated
Nonparticipating Employer or with the Employer while not qualified as an
Employee as defined herein shall be terminated in the same manner as service
with the Employer while qualified as an Employee as defined herein is
terminated. Any provisions of Section 2.1, 2.2, 2.3 or 2.4 hereof to the
contrary notwithstanding, the benefits of any such Participant who has been
transferred to or from the status as an eligible Employee on or after the date
that the Plan or Superseded Plan first became effective with respect to his
Employer shall be determined in accordance with the following provisions of this
Section 1.5.
(A) Eligibility for Benefits: In determining the eligibility of such an
employee to whom the provisions of this Section 1.5 are applicable for
participation in the Plan and in determining his eligibility for the
benefits provided under the Plan, his Vesting Service and Hours of
Service shall be determined in the same manner as though his service
with the Designated Nonparticipating Employers and with the Employers
while not qualified as an Employee as defined herein had been accrued
1-35
with the Employers while qualified as an Employee as defined herein.
Any such employee who is transferred to the status of an Employee as
defined herein shall become a Participant in the Plan on the date that
he becomes an Employee as defined herein if he has otherwise satisfied
the requirements to become a Participant in the Plan as described in
Section 1.2 hereof prior to such date that he becomes an Employee as
defined herein.
(B) Computation of Benefits: A Participant to whom the provisions of this
Section 1.5 are applicable shall be entitled upon his retirement or
termination of service (or his Beneficiary shall be entitled in the
event his service is terminated by reason of his death), if he meets
all requirements necessary to qualify for a benefit under the
provisions of Section 2.1, 2.2, 2.3 or 2.4 hereof or under the
provisions of any applicable section of any Supplement hereto that
specifically applies to the Participant, as the case may be, to a
benefit payable in accordance with the provisions of Section 2.1, 2.2,
2.3 or 2.4 hereof or in accordance with the provisions of any
applicable section of any Supplement hereto that specifically applies
to the Participant, whichever section is applicable, but the amount of
the monthly retirement income that is payable on his behalf under the
Plan shall, subject to the provisions of Section 1.5(C) below, be
computed using only the Credited Service that he accrued with the
Employers while qualified as an Employee as defined herein.
(C) Special Provisions Applicable to Benefits: The monthly income computed
under this Section 1.5 shall be subject to the following:
(1) there shall be no duplication of service in computing benefits
under the Plan and under any other qualified defined benefit
pension or annuity plan to which any Employer or Designated
Nonparticipating Employer makes contributions on behalf of its
employees who are not Employees as defined herein, and, if
service accrued while qualified as an Employee as defined herein
is used in determining the accrued benefit of the Participant
under any such other qualified defined benefit pension or annuity
plan, then the portion of the benefit payable under the Plan
based on such duplicated service shall be reduced (but not so as
to produce a negative amount) by the actuarially equivalent
amount of the benefit payable under such other qualified defined
benefit pension or annuity plan based on such duplicated service;
(2) all compensation that a Participant, who is an Employee as
defined herein on the date of his retirement or termination of
service, received from the Designated Nonparticipating Employers
and from the Employers while not qualified as an Employee as
defined herein shall be treated in determining his Final Average
Monthly Compensation in the same manner as though such
compensation had been received from the Employer while qualified
as an Employee as defined herein;
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(3) all compensation that a Participant, who is not an Employee as
defined herein on the date of his retirement or termination of
service, received after the date on which he last qualified as an
Employee as defined herein from the Designated Nonparticipating
Employers and from the Employers while not qualified as an
Employee as defined herein shall be ignored or excluded in
determining his Final Average Monthly Compensation and the period
during which he received such compensation shall be ignored or
excluded in determining the 10 completed calendar years and the
five successive calendar years that are used in determining his
Final Average Monthly Compensation;
(4) in the case of a Participant who has been transferred to the
status of an Employee as defined herein, who has a nonforfeitable
right to an accrued benefit under any other pension or annuity
plan to which an Employer or Designated Nonparticipating Employer
has made contributions on his behalf and whose combined service
used in the computation of his accrued benefits under the Plan
and such other pension or annuity plan or plans exceeds 35 years,
the amount of the monthly retirement income that is payable under
the Plan on his behalf shall not be greater than an amount equal
to the excess, if any, of:
(a) the monthly retirement income that would have been payable
on behalf of such Participant under the provisions of the
Applicable Section of the Plan or Supplement if the service
used to compute his accrued benefit under such qualified
pension or annuity plan or plans were included with the
Credited Service that he accrued with the Employers while
qualified as an Employee as defined herein;
over
(b) the actuarial equivalent of the accrued benefit to which
such Participant has a nonforfeitable right under such
qualified pension or annuity plan or plans;
(5) the Participant's employee status at the date of termination of
his service due to disability shall be deemed to have continued
without change in determining the monthly retirement income that
may become payable on his behalf under the provisions of Section
2.3 hereof; and
(6) the benefit determined under Section 2.4(B)(1)(b) hereof shall
apply only if the Participant is an Employee as defined herein on
the date of his death and in that event:
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(a) the benefit under Section 2.4(B)(1)(b)(i) shall be reduced
by the actuarial equivalent of the benefit payable on behalf
of such Participant under each other qualified pension or
annuity plan, if any, to which an Employer or Designated
Nonparticipating Employer has made contributions on his
behalf; and
(b) the limitation equal to 100 times the Participant's monthly
normal retirement income, described in Section
2.4(B)(1)(b)(ii), shall include the anticipated monthly
retirement income based on his service accrued prior to his
death to which such Participant would be entitled at his
Normal Retirement Date or the date of his death, whichever
is later, under each other qualified pension or annuity
plan, if any, to which an Employer or Designated
Nonparticipating Employer has made contributions on his
behalf.
(D) Payments From One Trust Fund: In lieu of the payment of retirement
income or other benefits to such a Participant from the trust fund of
more than one qualified defined benefit pension plan of the Designated
Nonparticipating Employers and the Employers, the administrators of
the pension plans may, by mutual agreement, provide for payment of the
entire monthly income or other benefit from one trust fund with
appropriate reimbursement to the trustee of the trust fund from which
the benefits are to be paid by transfer of funds equal to the
single-sum value of the benefits payable under the other plan (or
plans) to the trust fund from which benefits actually will be paid.
1.6 - PARTICIPATION AND BENEFITS FOR FORMER LEASED EMPLOYEES
A Leased Employee of an Employer or Designated Nonparticipating Employer
shall not be deemed for any purposes of the Plan to be an employee of such
Employer or Designated Nonparticipating Employer. However, in the event that any
former Leased Employee qualifies as an Employee as defined herein on or after
the Effective Date of the Plan, unless the Plan is otherwise excluded by
applicable regulations from the requirements of Section 414(n) of the Internal
Revenue Code, the total period that he provided services to the Employer or
Designated Nonparticipating Employer as a Leased Employee shall be treated under
the Plan in determining his nonforfeitable right to his accrued benefits and his
eligibility to become a Participant in the Plan in the manner described in
Section 1.5(A) hereof as though he had been an employee of a Designated
Nonparticipating Employer during such period of service (but such service shall
not be included in the service that is used to calculate any benefits that he
accrues under the Plan). A "Leased Employee" as defined under Section 414(n) of
1-38
the Internal Revenue Code is any person (other than an employee of the
recipient) who pursuant to an agreement between the recipient and any other
person ("leasing organization") has performed services for the recipient (or for
the recipient and related persons determined in accordance with Internal Revenue
Code Section 414(n)(6)) on a substantially full-time basis for a period of at
least 1 year, and such services are performed under the recipient's primary
direction or control.
1.7 - RIGHTS OF OTHER EMPLOYERS TO PARTICIPATE
Capital Southwest Corporation, Capital Southwest Management Corporation,
Jet-Lube, Inc., The RectorSeal Corporation, The Whitmore Manufacturing Company,
Smoke Guard, Inc. and Blue Magic, Inc. are participating Employers in the Plan.
Any other corporation, association, joint venture, proprietorship, partnership
or other business organization may, in the future, adopt the Plan on behalf of
all or certain of its Employees by formal action on its part in the manner
described in Section 6.7 hereof provided that the Sponsoring Employer, by formal
action on its part in the manner described in Section 6.7 hereof, and the
Committee both approve such participation.
The administrative powers and control of the Sponsoring Employer, as
provided in the Plan, shall not be deemed diminished under the Plan by reason of
the participation of any other Employers in the Plan, and such administrative
powers and control specifically granted herein to the Sponsoring Employer with
respect to the appointment of the Committee, amendment of the Plan and other
matters shall apply only with respect to the Sponsoring Employer.
The Plan is an IRC 414(l) Single Plan with respect to all Employers unless
the Sponsoring Employer, by formal action on its part in the manner described in
Section 6.7 hereof, specifically provides that the Plan shall be a separate IRC
414(l) Single Plan with respect to any Employer or to any division of any
Employer or with respect to any group of Employers and/or divisions. In the
event that the Plan does not represent one IRC 414(l) Single Plan with respect
to all divisions of any Employer, the division or divisions with respect to
which the Plan represents a separate IRC 414(l) Single Plan shall be considered
1-39
for the purposes of this section and treated under the Plan as one Employer and
its other division or divisions shall be considered for the purposes of this
section and treated under the Plan as a separate Employer or, if applicable, as
separate Employers.
The contributions of any Employer that is a member of a group of Employers
with respect to which the Plan represents an IRC 414(l) Single Plan shall be
available to provide benefits on behalf of any Participants who are employees of
any other Employers that are members of such group but shall not be available to
provide benefits on behalf of any Participants who are employees of any
Employers that are not members of such group. The contributions of any Employer
with respect to which the Plan represents an IRC 414(l) Single Plan for only
that Employer shall be available to provide benefits on behalf of Participants
who are its employees but shall not be available to provide benefits on behalf
of Participants who are employees of any other Employers.
Any Employer may withdraw from the Plan at any time by formal action on its
part, in the manner described in Section 6.7 hereof, specifying its
determination to withdraw. Any such withdrawing Employer shall furnish the
Committee and the Trustee with evidence of the formal action of its
determination to withdraw. Any such withdrawal may be accompanied by such
modifications to the Plan as such Employer shall deem proper to continue a
retirement plan for its Employees separate and distinct from the retirement plan
herein set forth. Withdrawal from the Plan by any Employer shall not affect the
continued operation of the Plan with respect to the other Employers; provided,
however, in the event of the withdrawal of an Employer that is a member of a
group of Employers with respect to which the Plan represents an IRC 414(l)
Single Plan and in the event that provision is made for the continuation of a
retirement plan for its Employees separate and distinct from the retirement plan
herein set forth, the share, if any, of the assets of the Trust Fund allocable
to such group of Employers that is transferred on behalf of such withdrawing
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Employer to such other retirement plan shall, subject to the provisions of
Section 414(l) of the Internal Revenue Code and regulations issued pursuant
thereto, be equal to the assets, if any, that would have been allocated on
behalf of the employees of such withdrawing Employer under the provisions of
Section 4.5 hereof if such withdrawing Employer had terminated its participation
in the Plan on the date of such withdrawal; provided, however, that the
Sponsoring Employer, by formal action on its part in the manner described in
Section 6.7 hereof, may, in its absolute discretion, direct that an additional
amount of assets be transferred on behalf of such withdrawing Employer to such
other retirement plan provided that the transfer of such additional amount of
assets would not lower the amount of the distributions that would be made on
behalf of the Participants who are employees of the other Employers that are
members of such group of Employers with respect to which the Plan represents an
IRC 414(l) Single Plan if the Plan were terminated as of the effective date of
such transfer with respect to all of the Employers that are members of such
group of Employers.
The Sponsoring Employer, by formal action on its part in the manner
described in Section 6.7 hereof, may in its absolute discretion terminate any
Employer's participation in the Plan at any time, and the provisions of the Plan
shall be applied with respect to such Employer in the same manner as though it
had voluntarily withdrawn as a participating Employer.
1.8 - SERVICE AND TERMINATION OF SERVICE
For purposes of the Plan, an Employee or Participant shall be considered to
be in the service of the Employer and shall not be considered to have incurred a
termination of his service until the date of his early, normal or disability
retirement, death, resignation, discharge or other termination of his employment
with an Employer, notwithstanding any payment or agreement to pay severance pay
in connection with the termination of his employment.
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SECTION 2
NORMAL AMOUNT AND PAYMENT OF RETIREMENT INCOME
2.1 - NORMAL RETIREMENT AND RETIREMENT INCOME
Normal retirement under the Plan is retirement from the service of the
Employer on or after the date that the Participant attains his Normal Retirement
Age. No provision of this section or the Plan shall require the retirement of a
Participant upon his attainment of his Normal Retirement Age. In the event of
normal retirement, payment of retirement income will be governed, subject to the
provisions of Section 4 hereof, by the following provisions of this Section 2.1.
(A) Normal Retirement Date: The Normal Retirement Date of each Participant
will be the first day of the month coincident with or next following the date on
which he attains his Normal Retirement Age. Any Participant who retires after
attaining his Normal Retirement Age but prior to his Normal Retirement Date and
who is surviving on his Normal Retirement Date shall be considered for the
purposes of the Plan to have retired on his Normal Retirement Date
(B) Amount of Retirement Income: The monthly retirement income payable in
the manner described in Section 2.1(C) hereof to a Participant who retires on
and after April 1, 1998, bur prior to April 1, 2007, and on or after his Normal
Retirement Date shall be an amount equal to the sum of:
(1) 1.25% of his Final Average Monthly Compensation multiplied by his
number of years of Credited Service that are not in excess of 35
years;
plus
(2) 0.65% of that portion, if any, of his Final Average Monthly
Compensation that is in excess of the Monthly Covered
Compensation that applies to him multiplied by his number of
years of Credited Service that are not in excess of 35 years.
Notwithstanding the foregoing provisions of this Section 2.1(B), the
monthly retirement income of a Participant who retires on or after April 1,
1998, and on or after his Normal Retirement Date shall not be less than the
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monthly retirement income which the Participant has accrued as of March 31,
1998, based upon the Participant's Credited Service, Final Average Monthly
Compensation, and Monthly Covered Compensation (or, if applicable, the
corresponding terms used to compute his accrued benefit under the Superseded
Plan) determined as of March 31, 1998, under the provisions of the Plan and the
First Supplement then in effect, adjusted on an actuarially equivalent basis, if
applicable, to his Annuity Starting Date in accordance with the above provisions
of this Section 2.1(B).
Effective as of April 1, 2007, the monthly retirement income payable to a
Participant who retires on and after April 1, 2007, and on or after his Normal
Retirement Date shall be an amount equal to the sum of:
(1) 1.20% of his Final Average Monthly Compensation multiplied by his
number of years of Credited Service that are not in excess of 35
years;
plus
(2) 0.65% of that portion, if any, of his Final Average Monthly
Compensation that is in excess of the Monthly Covered
Compensation that applies to him multiplied by his number of
years of Credited Service that are not in excess of 35 years.
Notwithstanding the foregoing provisions of this Section 2.1(B), the
monthly retirement income of a Participant who retires on or after April 1,
2007, and on or after his Normal Retirement Date shall not be less than the
monthly retirement income which the Participant has accrued as of March 31,
2007, based upon the Participant's Credited Service, Final Average Monthly
Compensation and Monthly Covered Compensation determined as of March 31, 2007,
under the provisions of the Plan and Supplements then in effect.
The monthly amount of retirement income payable to a Participant who
retires after his Normal Retirement Date, however, shall not be less than that
amount that can be provided on an actuarially equivalent basis by the sum of (i)
the single-sum value as of his Normal Retirement Date of the normal monthly
retirement income that would have been payable to him under the provisions of
the Plan or Superseded Plan, whichever is applicable, as in effect on his Normal
Retirement Date if he had retired on his Normal Retirement Date, based upon his
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Credited Service, Final Average Monthly Compensation and Monthly Covered
Compensation (or, if applicable, the corresponding terms used to compute his
accrued benefit under the Superseded Plan) determined as though he had actually
retired on his Normal Retirement Date, and (ii) the amount of interest on such
single-sum value in (i) above, where the interest shall be compounded annually
from the Participant's Normal Retirement Date to his Annuity Starting Date. All
computations to determine such minimum monthly retirement income payable to or
on behalf of such a Participant shall be on the basis of the interest and
mortality assumptions that were being used as of his Normal Retirement Date to
determine actuarially equivalent non-decreasing annuities.
(C) Payment of Retirement Income: The monthly retirement income payable in
the event of normal retirement will be payable on the first day of each month.
The first payment will be made on the Participant's Normal Retirement Date, or,
if the Participant retires after his Normal Retirement Date, the first payment
will be made on the first day of the month coincident with or next following the
date of his actual retirement. The last payment will be the payment due
immediately preceding the retired Participant's death.
Where a Participant's monthly retirement income commences after April 1
following the calendar year in which such Participant attains age 70 1/2, the
accrued benefit of such Participant shall be actuarially increased in accordance
with regulations or other official pronouncements of the Internal Revenue
Service to take into account the period beginning on April 1 following the
calendar year in which the Participant attains age 70 1/2 and ending on the date
on which benefits under the Plan commence after retirement in an amount
sufficient to satisfy Section 401(a)(9) of the Internal Revenue Code.
(D) Special Provisions Applicable to Participants Who Receive Retirement
Income Payments While Continuing in Employment of Employer After Required
Beginning Date: Any of the above provisions of this Section 2.1 to the contrary
notwithstanding, but subject to the provisions of Sections 4.1 and 4.8 hereof, a
Participant who continues in the employment of the Employer beyond his Required
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Beginning Date shall begin receiving monthly retirement income payments
commencing as of his Required Beginning Date.
The monthly retirement income payments of a Participant who continues in
the employment of the Employer beyond his Required Beginning Date and begins
receiving monthly retirement income payments commencing as of his Required
Beginning Date shall be determined in the same manner as though the Participant
had actually retired on his Required Beginning Date and shall be paid in the
form specified in Section 2.1(C) above. The retirement income payable to such a
Participant shall thereafter be subject to adjustment as of the first day of
each calendar year which begins after his Required Beginning Date and prior to
the date of his actual retirement and shall be subject to adjustment as of the
first day of the month coincident with or next following the date of his actual
retirement (each such adjustment day is herein referred to as a "Post Payment
Recalculation Date") to reflect the additional accruals, if any, that such
Participant is entitled to receive because of his employment after his Required
Beginning Date. The additional retirement income, if any, payable to any such
Participant on and after an applicable Post Payment Recalculation Date shall be
determined in accordance with the provisions of Section 411(b)(1)(H) of the
Internal Revenue Code and regulations issued with respect thereto, and the
actuarial equivalent of the retirement income payments that the Participant has
received under the provisions of this Section 2.1 on and after his Required
Beginning Date and prior to the applicable Post Payment Recalculation Date shall
be used as an offset in the determination of such additional income, but such
offset shall not result in the retirement income payable to the Participant
being reduced below the amount that was payable on his behalf immediately prior
to such Post Payment Recalculation Date. The additional amount of monthly
retirement income, if any, that a Participant accrues after his Required
Beginning Date shall be converted to an actuarially equivalent amount of monthly
retirement income that is payable in the same manner and form as the monthly
retirement income that is payable on his behalf immediately prior to the
applicable Post Payment Recalculation Date, and such additional actuarially
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equivalent income shall be payable to the Participant commencing as of the
applicable Post Payment Recalculation Date. Upon the actual retirement of such a
Participant, the Participant's remaining retirement income shall continue to be
paid, commencing as of the first day of the month coincident with or next
following the date of his actual retirement, in the manner specified in Section
2.1(C) above, except that the Participant shall be entitled to elect another
form of payment in accordance with Section 3.1.
2.2 - EARLY RETIREMENT AND RETIREMENT INCOME
Early retirement under the Plan is retirement from the service of the
Employer prior to the Participant's Normal Retirement Date and on or after the
date as of which he has both attained the age of 55 years and completed 10 years
of Vesting Service. In order to retire under the provisions of this section, the
written consent of the Participant to the commencement of his retirement income
payments in accordance with the provisions of this Section 2.2 must be filed
with the Committee within 90 days of the date as of which his retirement income
payments are to commence. In the event of early retirement, payment of
retirement income will be governed, subject to the provisions of Section 4
hereof, by the following provisions of this Section 2.2.
(A) Early Retirement Date: The Early Retirement Date will be the first day
of the month coincident with or next following the date a Participant retires
from the service of the Employer under the provisions of this Section 2.2 prior
to his Normal Retirement Date.
(B) Amount of Retirement Income: The monthly amount of retirement income
payable in the manner described in Section 2.2(C) hereof to a Participant who
retires prior to his Normal Retirement Date under the provisions of this Section
2.2 shall be equal to the product of:
(1) the Accrued Deferred Monthly Retirement Income Commencing at
Normal Retirement Date which the Participant has accrued as of
his Early Retirement Date;
multiplied by
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(2) the early retirement reduction factor specified in the schedule
below, based upon the number of years and full months by which
the Participant's Early Retirement Date precedes his Normal
Retirement Date:
Early Retirement Reduction Factors By Years and Months
By Which Early Retirement Date Precedes Normal Retirement Date
Months
Years 0 1 2 3 4 5 6 7 8 9 10 11
- ----- ----- ----- ----- ----- ----- ----- ----- ----- ----- ----- ----- -----
0 1.000 0.994 0.989 0.983 0.978 0.972 0.967 0.961 0.956 0.950 0.944 0.939
1 0.933 0.928 0.922 0.917 0.911 0.906 0.900 0.894 0.889 0.883 0.878 0.872
2 0.867 0.861 0.856 0.850 0.844 0.839 0.833 0.828 0.822 0.817 0.811 0.806
3 0.800 0.794 0.789 0.783 0.778 0.772 0.767 0.761 0.756 0.750 0.744 0.739
4 0.733 0.728 0.722 0.717 0.711 0.706 0.700 0.694 0.689 0.683 0.678 0.672
5 0.667 0.664 0.661 0.658 0.656 0.653 0.650 0.647 0.644 0.642 0.639 0.636
6 0.633 0.631 0.628 0.625 0.622 0.619 0.617 0.614 0.611 0.608 0.606 0.603
7 0.600 0.597 0.594 0.592 0.589 0.586 0.583 0.581 0.578 0.575 0.572 0.569
8 0.567 0.564 0.561 0.558 0.556 0.553 0.550 0.547 0.544 0.542 0.539 0.536
9 0.533 0.531 0.528 0.525 0.522 0.519 0.517 0.514 0.511 0.508 0.506 0.503
10 0.500
(C) Payment of Retirement Income: The retirement income payable in the
event of early retirement will be payable on the first day of the month. The
first payment will be made on the Participant's Early Retirement Date and the
last payment will be the payment due immediately preceding the retired
Participant's death.
2.3 - DISABILITY RETIREMENT AND RETIREMENT INCOME
A Participant may retire from the service of the Employer under the Plan
if:
(1) his service is terminated prior to his Normal Retirement Date and
on or after the Effective Date of the Plan by reason of his
becoming totally and permanently disabled as defined in Section
2.3(A) below; and
(2) he applies for a disability retirement benefit under the Plan, or
under any other formal plan of the Employer which provides
specific disability benefits, within six months after the date of
termination of his service due to disability; provided, however,
that such six-month period for application may be extended by the
Committee when, in its sole discretion, reasonable cause exists
for so doing.
Such retirement from the service of the Employer shall herein be referred to as
disability retirement. In the event of disability retirement, uniformly and
consistently applied rules shall be used with respect to all Participants in
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similar circumstances and payment of retirement income will be governed, subject
to the provisions of Section 4 hereof, by the following provisions of this
Section 2.3.
(A) Total and Permanent Disability: A Participant shall be considered
totally and permanently disabled for the purposes of the Plan if, in the opinion
of the Committee, he is disabled, due to sickness or injury, from a cause other
than specified in Section 2.3(B) hereof, and, as a result of such disability, he
is eligible for and is receiving (after any specified waiting period) either (a)
disability benefits under the Social Security Act or (b) payments (other than
workers' compensation payments or medical or hospitalization payments) payable
directly or indirectly by the Employer or its insurer as a result of the
Participant's sickness or injury under any long-term disability program
maintained by the Employer.
(B) Nonadmissible Causes of Disability: A Participant will not be entitled
to receive any disability retirement income if, in the opinion of the Committee,
the disability is a result of:
(1) excessive and habitual use by the Participant of drugs,
intoxicants or narcotics;
(2) injury or disease sustained by the Participant while willfully
and illegally participating in fights, riots, civil insurrections
or while committing a felony;
(3) injury or disease sustained by the Participant while serving in
any armed forces;
(4) injury or disease sustained by the Participant which was
diagnosed or discovered subsequent to the date his employment was
terminated;
(5) injury or disease sustained by the Participant while working for
anyone other than the Employer and arising out of such
employment; or
(6) injury or disease sustained by the Participant as a result of an
act of war, whether or not such act arises from a formally
declared state of war.
(C) Proof of Disability: The Participant, in order to be eligible for the
benefits provided under this Section 2.3, shall furnish satisfactory proof
(which may be in the form of evidence satisfactory to the Committee that the
Participant is receiving disability benefits under the Social Security Act or
2-8
under any long-term disability program maintained by the Employer) that he has
become totally and permanently disabled as provided herein. Every six months
after the date of termination of the Participant's service due to disability, or
more frequently, the Committee may similarly require proof of the continued
disability of the Participant.
(D) Disability Retirement Income Commencement Date: The Disability
Retirement Income Commencement Date of a Participant who retires under the
provisions of this Section 2.3 will be his Normal Retirement Date; provided,
however, if the Participant receives payments (other than workers' compensation
payments or medical or hospitalization payments) after his Normal Retirement
Date that are payable directly or indirectly by the Employer or its insurer as a
result of the Participant's sickness or injury under any long-term disability
program maintained by the Employer, the Disability Retirement Income
Commencement Date of such Participant will be the first day of the month
coincident with or next following (a) the date as of which such payments under
such long-term disability program maintained by the Employer are discontinued or
(b) his Required Beginning Date, whichever is earlier.
(E) Disability Retirement Income: The monthly amount of retirement income
payable in the manner described in Section 2.3(F) hereof to a Participant who
retires from the service of the Employer under the provisions of this Section
2.3 due to total and permanent disability and who attains his Normal Retirement
Date without recovering from his total and permanent disability shall be equal
to the anticipated monthly retirement income to which the Participant would have
been entitled on his Disability Retirement Income Commencement Date in
accordance with the provisions of Section 2.1(B) hereof if:
(1) his employment had not been terminated but had continued
uninterrupted from the date of termination of his service due to
disability to his Disability Retirement Income Commencement Date;
(2) his last regular rate of monthly Compensation prior to the date
of termination of his service due to disability had continued
without change to his Disability Retirement Income Commencement
Date;
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(3) the amount of the Monthly Covered Compensation that applies at
his Disability Retirement Income Commencement Date were the same
as the corresponding amount determined as of the date of
termination of his service due to disability; and
(4) the provisions of the Plan as in effect on the date of
termination of his service due to disability had continued
without change until his Disability Retirement Income
Commencement Date.
(F) Payment of Disability Retirement Income: The monthly retirement income
to which a Participant is entitled in the event of his disability retirement
will be payable on the first day of each month. The first payment will be made
on the Participant's Disability Retirement Income Commencement Date, provided
that he attains his Normal Retirement Date without recovering from his total and
permanent disability and provided that application has been made in writing by
the Participant or his authorized representative for disability retirement under
the provisions of this Section 2.3. The last payment will be the payment due
immediately preceding the date of his death.
(G) Benefit Payable in the Event of Death of Disabled Participant Prior to
Disability Retirement Income Commencement Date: In the event that a Participant
dies after he has been determined to be totally and permanently disabled by the
Committee and prior to his Disability Retirement Income Commencement Date, and
prior to his recovery from his total and permanent disability if he has not
attained his Normal Retirement Age as of the date of his death, his Beneficiary
will receive, in lieu of all other benefits payable on behalf of the Participant
under the Plan, the death benefit, determined and payable in the manner
described in Section 2.4(B) hereof, which would have been payable on behalf of
the Participant under the provisions of Section 2.4(B) if:
(1) his employment had not been terminated but had continued
uninterrupted from the date of termination of his service due to
disability until the date of his death;
(2) his last regular monthly rate of Compensation prior to the date
of termination of his service due to disability had continued
without change to the date of his death;
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(3) the amount of the Monthly Covered Compensation that applies at
the date of his death were the same as the amount determined as
of the date of termination of his service due to disability; and
(4) the provisions of the Plan as in effect on the date of
termination of his service due to disability had continued
without change to the date of his death.
(H) Recovery from Disability: If the Committee finds that any Participant
who is entitled to receive a disability retirement income under the provisions
of this Section 2.3 commencing at his Disability Retirement Income Commencement
Date has, at any time prior to his Normal Retirement Date, recovered from his
total and permanent disability, such Participant and his Beneficiary shall not
be entitled to any benefits under this Section 2.3 unless he reenters the
service of the Employer and his service is subsequently terminated by reason of
his total and permanent disability in accordance with the provisions hereof. A
Participant shall be deemed to have recovered from his total and permanent
disability for the purposes of the Plan if the disability benefits, if any,
which he is receiving under the Social Security Act and the payments, if any,
which he is receiving under the Employer's long-term disability program are
discontinued. However, any such Participant who recovers from his total and
permanent disability shall accrue Vesting Service during the period that he is
considered by the Committee to have been totally and permanently disabled as
provided herein, and, if the date of his recovery from his total and permanent
disability is on or after his Initial Vesting Date and he does not reenter the
service of the Employer, he shall be entitled to the vested retirement income
determined and payable in accordance with the provisions of Section 2.4(A)
hereof, computed as though his service had been terminated on the date of his
recovery from his total and permanent disability but based upon his Credited
Service, Final Average Monthly Compensation and Monthly Covered Compensation
determined as of the date of termination of his service due to disability.
(I) Election of Vested Benefit on Termination of Service in Lieu of
Disability Retirement: A Participant whose service is terminated on or after his
Initial Vesting Date by reason of his total and permanent disability may elect,
in writing filed with the Committee prior to his Normal Retirement Date, to
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receive the benefits provided under Section 2.4(A) hereof in lieu of the
disability retirement benefits provided under this Section 2.3. The benefits
payable hereunder to or on behalf of any such Participant who makes such an
election shall be determined as though the Participant's service had not been
terminated by reason of total and permanent disability. The Committee shall
require the consent of the Participant's spouse, if any, before any election
under this Section 2.3(I) will become effective.
2.4 - BENEFITS OTHER THAN ON RETIREMENT
(A) Benefit on Termination of Service and on Death After Termination of
Service:
(1) In the event that a Participant's service is terminated prior to his
Normal Retirement Date and on or after his Initial Vesting Date for any reason
other than his death, early retirement as described in Section 2.2 hereof or
disability retirement as described in Section 2.3 hereof, he will be entitled to
a monthly retirement income, payable in the manner described in Section
2.4(A)(2) hereof, equal to:
(a) an amount equal to either:
(i) if the Participant has not both attained the age of 55
years and completed 10 years of Vesting Service as of
the date of termination of his service, the Accrued
Deferred Monthly Retirement Income Commencing at Normal
Retirement Date that he has accrued to the date of
termination of his service;
or
(ii) if the Participant has both attained the age of 55
years and completed 10 years of Vesting Service as of
the date of termination of his service, the monthly
retirement income, payable in the manner described in
Section 2.4(A)(2) hereof commencing at his Normal
Retirement Date, if he shall then be living, which is
the actuarial equivalent (ignoring the actuarial cost
of any death benefit coverage provided between the date
of termination of his service and his Normal Retirement
Date) of the monthly early retirement income that would
have been payable on his behalf in accordance with the
provisions of Section 2.2 hereof if he had retired
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under the provisions of that section on the date of
termination of his service;
multiplied by
(b) his Vested Percentage, which shall be equal to the percentage
specified in the schedule below, based upon his number of years
(ignoring fractions) of Vesting Service as of the date of
termination of his service:
Years of Vested
Vesting Service Percentage
--------------- ----------
Less than 5 0%
5 or more 100%;
provided, however, that the Vested Percentage of any Participant
who has attained his Normal Retirement Age as of the date of
termination of his service shall be 100%;
with the resulting product multiplied by
(c) a factor, which is based upon the period, if any, that the death
benefit coverage described in Section 2.4(A)(3) below has been in
effect after the date of termination of his service and prior to
his Annuity Starting Date, that will reduce the product of (a)
and (b), if applicable, to reflect the cost, determined on an
actuarially equivalent basis, of providing such death benefit
coverage during such period;
with the resulting product multiplied by
(d) a factor that will convert, if applicable, the amount of monthly
retirement income that is payable to the Participant in the
manner described in Section 2.4(A)(2) hereof commencing at his
Normal Retirement Date to an actuarially equivalent amount of
monthly retirement income that is payable to the Participant in
the manner described in Section 2.4(A)(2) hereof commencing on
his Annuity Starting Date.
All actuarial computations to determine the monthly retirement income payable to
or on behalf of such a terminated Participant (including any computations to
determine the monthly retirement income payable on his behalf under Section
2.4(A)(3) or 3.1 hereof) shall be on the basis of the interest and mortality
assumptions that are being used as of the date of termination of his service to
determine actuarially equivalent non-decreasing annuities.
2-13
(2) The retirement income payable under Section 2.4(A)(1) above will be
payable on the first day of each month. The first payment will be made, if the
Participant shall then be living, as of:
(a) if he does not elect an earlier commencement date pursuant to the
provisions of (b) below, his Normal Retirement Date;
or
(b) if he had completed at least 10 years of Vesting Service as of
the date of termination of his service and he so elects in
writing filed with the Committee at least 30 but not more than 90
days prior to the effective date thereof (or if the Participant
waives the 30-day notice period with any required spousal
consent, then more than 7 days but not more than 90 days prior to
the effective date thereof), the first day of any month, which is
prior to his Normal Retirement Date and is on or after the date
on which he attained the age of 55 years, that he specifies in
his written election filed with the Committee.
The last payment will be the payment due immediately preceding his death.
(3) In the event that the terminated Participant dies prior to his Annuity
Starting Date (without his having waived, in accordance with the provisions of
Section 2.4(A)(4) below, the benefit provided under this Section 2.4(A)(3) and
without his having received, prior to his death, the actuarially equivalent
value of the benefit provided on his behalf under Section 2.4(A)(1) above), his
Beneficiary will receive, subject to the provisions of Section 4.1(D) hereof
regarding the Qualified Preretirement Survivor Annuity, the monthly retirement
income, beginning on the first day of the month coincident with or next
following the date of the terminated Participant's death, which can be provided
on an actuarially equivalent basis by the single-sum value of the benefit
determined in accordance with Section 2.4(A)(1) above to which the terminated
Participant was entitled as of the date of termination of his service,
accumulated with interest from such date to the date of his death. The monthly
retirement income payments under this Section 2.4(A)(3) shall, subject to the
provisions of Section 2.4(B)(4) hereof, be payable for the life of the
Beneficiary designated or selected under Section 5.2 hereof to receive such
benefit, and, in the event of such Beneficiary's death within a period of 10
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years after the Participant's death, the same monthly amount that was payable to
the Beneficiary shall be payable for the remainder of such 10-year period in the
manner and subject to the provisions of Section 5.3 hereof; provided, however,
in lieu of payment of such benefit in the form of monthly income described
above, the single-sum value of such benefit may be paid on an actuarially
equivalent basis to the Participant's designated Beneficiary in such other
manner and form permitted under Section 2.4(B) hereof and commencing on such
other date permitted under Section 2.4(B) hereof as the Participant may elect in
writing filed with the Committee or, in the event that a specific election has
not been made by the Participant and filed with the Committee prior to his
death, as the Beneficiary may elect in writing filed with the Committee.
(4) A terminated Participant may, with the consent of his spouse, if any,
elect in writing filed with the Committee at any time (and any number of times)
prior to his Annuity Starting Date, to waive prospectively the death benefit
provided under Section 2.4(A)(3) above and, in lieu thereof, an increased
retirement income, which reflects on an actuarially equivalent basis the period
that the death benefit coverage under Section 2.4(A)(3) is waived, will be
payable to the Participant under the provisions of Section 2.4(A)(1) if he shall
be living on his Annuity Starting Date. Within one year after the date of
termination of service of a Participant who is entitled to a benefit under the
provisions of this Section 2.4(A), or as soon thereafter as is administratively
practicable, the Committee shall furnish the Participant with written
notification informing him of his right to waive the death benefit provided
under Section 2.4(A)(3) above and the consequences of such a waiver. Any
Participant who has waived the death benefit provided under Section 2.4(A)(3)
may subsequently revoke such waiver at any time (and any number of times) prior
to his Annuity Starting Date by filing written notice of such revocation with
the Committee prior to the date on which such revocation is to become effective.
Any Participant who has waived the death benefit provided under Section
2.4(A)(3) and who subsequently marries or remarries after such waiver and prior
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to his Annuity Starting Date shall automatically be deemed to have revoked his
prior waiver of such death benefit effective as of the first anniversary of the
date of such marriage or remarriage unless his spouse (following such marriage
or remarriage) consents to the waiver of such death benefit.
(5) Any Participant, who is entitled to a benefit under the provisions of
Section 2.4(A)(1) above and who is married on his Annuity Starting Date or who
is married on the date of his death and on whose behalf a benefit is payable
under Section 2.4(A)(3) above, shall be assumed for the purposes of this Section
2.4(A) to have been married for the total period of time beginning on the date
of termination of his service and ending on his Annuity Starting Date or the
date of his death, whichever is earlier, except for such portions, if any, of
such period of time for which evidence is furnished to the Committee which, in
the opinion of the Committee, satisfactorily proves that the Participant was not
married.
(6) The provisions of Sections 3.1 and 4 hereof are applicable to the
benefits provided under this Section 2.4(A).
(7) Except as specifically provided otherwise in any Supplement hereto and
except as provided in Section 2.3 with respect to disability retirement and
unless specifically provided otherwise in the Plan, the Participant whose
service is terminated prior to his Initial Vesting Date shall not be entitled to
any benefit under the Plan whatever, and the value of such Participant's accrued
benefit shall be forfeited as of the date of termination of his service and used
to reduce Employer contributions.
(B) Benefit Payable in Event of Death While in Service:
(1) If the service of a Participant is terminated by reason of his death on
and after April 1, 1998, but prior to April 1, 2007, and on and after his
Initial Vesting Date and prior to his Required Beginning Date, there shall be
payable to the Participant's designated Beneficiary the monthly retirement
income, beginning on the first day of the month coincident with or next
following the date of the Participant's death, that can be provided on an
actuarially equivalent basis by the greater of:
(a) an amount equal to:
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(i) if the Participant's service is terminated by reason of his
death prior to his Normal Retirement Date, the single-sum
value, determined as of the date of his death, of the
Accrued Deferred Monthly Retirement Income Commencing at
Normal Retirement Date that the Participant has accrued to
the date of his death;
or
(ii) if the Participant's service is terminated by reason of his
death on or after his Normal Retirement Date, the single-sum
value, determined immediately prior to the Participant's
death, of the monthly retirement income that the Participant
would have been entitled to receive under the provisions of
Section 2.1(B) hereof if he had retired from the service of
the Employer on the date of his death;
or
(b) an amount equal to the smaller of:
(i) either:
(aa) 24 times the Participant's Final Average Monthly
Compensation at the date of his death if he had not
completed 10 years of Vesting Service as of the date of
his death;
or
(bb) 36 times the Participant's Final Average Monthly
Compensation at the date of his death if he had
completed 10 years of Vesting Service as of the date of
his death;
or
(ii) 100 times the monthly retirement income to which the
Participant would have been entitled on his Normal
Retirement Date in accordance with the provisions of Section
2.1(B) hereof if he had remained in the service of the
Employer, with no change in his last regular monthly rate of
Compensation, until his Normal Retirement Date and based
upon the Monthly Covered Compensation that applies to him as
of the date of his death instead of as of his Normal
Retirement Date or, if his Normal Retirement Date was on or
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prior to the date of his death, 100 times the monthly
retirement income that the Participant would have been
entitled to receive under the provisions of Section 2.1(B)
hereof if he had retired from the service of the Employer on
the date of his death.
If the service of a Participant is terminated by reason of his death on and
after April 1, 2007 and on and after his Initial Vesting Date and prior to his
Required Beginning Date, there shall be payable to the Participant's designated
Beneficiary the monthly retirement income, beginning on the first day of the
month coincident with or next following the date of the Participant's death,
that can be provided on an actuarially equivalent basis by the greater of:
(a) an amount equal to:
(i) if the Participant's service is terminated by reason of his
death prior to his Normal Retirement Date, the single-sum
value, determined as of the date of his death, of the
Accrued Deferred Monthly Retirement Income Commencing at
Normal Retirement Date that the Participant has accrued to
the date of his death;
or
(ii) if the Participant's service is terminated by reason of his
death on or after his Normal Retirement Date, the single-sum
value, determined immediately prior to the Participant's
death, of the monthly retirement income that the Participant
would have been entitled to receive under the provisions of
Section 2.1(B) hereof if he had retired from the service of
the Employer on the date of his death;
or
(b) an amount equal to the smaller of:
(i) 24 times the Participant's Final Average Monthly
Compensation at the date of his death;
or
(ii) 100 times the monthly retirement income to which the
Participant would have been entitled on his Normal
Retirement Date in accordance with the provisions of Section
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2.1(B) hereof if he had remained in the service of the
Employer, with no change in his last regular monthly rate of
Compensation, until his Normal Retirement Date and based
upon the Monthly Covered Compensation that applies to him as
of the date of his death instead of as of his Normal
Retirement Date or, if his Normal Retirement Date was on or
prior to the date of his death, 100 times the monthly
retirement income that the Participant would have been
entitled to receive under the provisions of Section 2.1(B)
hereof if he had retired from the service of the Employer on
the date of his death;
provided, however, that the provisions of Section 4.1(D) hereof relating to the
Qualified Preretirement Survivor Annuity shall apply with respect to a married
Participant whose service is terminated by reason of his death on or after his
Initial Vesting Date and whose designated Beneficiary is not his spouse.
(2) Except as provided in Section 2.4(B)(3) below and subject to the
provisions of Section 2.4(B)(4) below, the monthly retirement income payments
under this Section 2.4(B) shall be payable for the life of the Beneficiary
designated or selected under Section 5.2 hereof to receive such benefit, and, in
the event of such Beneficiary's death within a period of 10 years after the
Participant's death, the same monthly amount that was payable to the Beneficiary
shall be payable for the remainder of such 10-year period in the manner and
subject to the provisions of Section 5.3 hereof.
(3) A Participant may elect, or, in the event that a specific election has
not been made by the Participant and filed with the Committee prior to his
death, his designated Beneficiary may elect, in writing filed with the
Committee, that, in lieu of payment of the benefit provided under this Section
2.4(B) (or, if applicable, under Section 2.3(G) or 2.4(A)(3) hereof) in the
manner described above, such benefit will be paid on an actuarially equivalent
basis to the designated Beneficiary commencing on the first day of any month
that is on or after the date of the Participant's death and is on or prior to
the Participant's Required Beginning Date and is payable in accordance with one
of the options described below:
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Option A: A monthly retirement income in equal
amounts that is payable to the
Beneficiary for his lifetime.
Option B: A retirement income in equal amounts
that is payable for a period certain of
five or 10 years whichever is specified
by the Participant or his Beneficiary,
as the case may be, in his written
election filed with the Committee. In
the event of the Beneficiary's death
prior to the expiration of such
specified period certain, the same
amount shall be payable for the
remainder of the specified period
certain in the manner and subject to the
provisions of Section 5.3 hereof.
Option C: A combination of Option A and Option B.
Provided, however, that payment of any such benefit shall be subject to the
provisions of Section 2.4(B)(4) below.
(4) Any form of payment applicable to the death benefit provided under this
Section 2.4(B) (or, if applicable, under Section 2.3(G) or 2.4(A)(3) hereof),
which has been designated by a Participant prior to January 1, 1984 under the
terms of the Superseded Plan and which satisfies the transitional rule in
Section 242(b)(2) of the Tax Equity and Fiscal Responsibility Act of 1982 (P.L.
97-248), will continue in effect on and after the Effective Date of the Plan
with respect to the death benefits provided under this Section 2.4(B) (or, if
applicable, under Section 2.3(G) or 2.4(A)(3) hereof) unless such designated
form of payment has been or is subsequently revoked or changed (a change of
Beneficiaries under the designation will not be considered to be a revocation or
change of such form of payment so long as the change in Beneficiaries does not
alter, directly or indirectly, the period over which distributions are to be
made under such form of payment); provided, however, if a Participant, whose
death occurs on or after his Initial Vesting Date, had been married to his
spouse throughout the one-year period immediately preceding his death and he had
designated a person other than his spouse as his Beneficiary and such spouse has
not consented to such other person being designated, the provisions of Section
4.1(D) hereof shall apply with respect to payments due his surviving spouse, if
any.
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In the event that the Beneficiary to receive the death benefit payable
under Section 2.3(G), 2.4(A)(3) or 2.4(B) hereof on behalf of a Participant
whose death occurs prior to his Normal Retirement Date is his surviving spouse,
the retirement income payable to such surviving spouse under Section 2.3(G),
2.4(A)(3) or 2.4(B) hereof shall be deferred and be payable on an actuarially
equivalent basis to such surviving spouse commencing on the Participant's Normal
Retirement Date, if such surviving spouse is then living, unless (i) the
surviving spouse consents or elects in writing to receive such benefit
commencing as of a date that is prior to the Participant's Normal Retirement
Date and is on or after the date of the Participant's death, (ii) the date of
death of the Participant is prior to his Initial Vesting Date, (iii) the
Participant had not been married to his surviving spouse throughout the one-year
period immediately preceding his death or (iv) a lump-sum payment is payable to
his surviving spouse under the provisions of Section 3.2 hereof.
(5) If the service of a Participant is terminated by reason of his death on
or after his Initial Vesting Date and on or after his Required Beginning Date,
there shall be payable to the Participant's designated Beneficiary the monthly
retirement income, payable in the manner described in Section 2.4(B)(2) or
2.4(B)(3) above beginning on the first day of the month coincident with or next
following the date of the Participant's death, that can be provided on an
actuarially equivalent basis by an amount equal to the excess, if any, of:
(a) the amount described in Section 2.4(B)(1)(a) or Section
2.4(B)(1)(b), whichever is applicable;
over
(b) the sum of:
(i) the single-sum value, determined as of the Participant's
Required Beginning Date, of the retirement income that was
payable on his behalf commencing on his Required Beginning
Date, accumulated with interest from his Required Beginning
Date until the date of his death;
plus
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(ii) the sum of the single-sum values, determined as of each
applicable Post Payment Recalculation Date occurring after
the Participant's Required Beginning Date, of the additional
retirement income, if any, payable to such Participant
commencing on such applicable Post Payment Recalculation
Date, accumulated with interest from the applicable Post
Payment Recalculation Date to the date of his death.
Additional retirement income payments may be payable after the Participant's
death to his joint pensioner or other Beneficiary, depending upon the form of
payment of the retirement income that the Participant was receiving immediately
prior to his death and taking into account the increase, if any, that would have
applied under the provisions of Section 2.1(D) hereof to the amount of
retirement income payable to the Participant commencing as of the first day of
the month coincident with or next following the date of the Participant's death
if the Participant had retired immediately prior to his death and had survived
to such day.
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SECTION 3
SPECIAL PROVISIONS REGARDING PAYMENT OF BENEFITS
3.1 - OPTIONAL FORMS OF RETIREMENT INCOME
In lieu of the amount and form of retirement income commencing on the
Participant's regularly scheduled Annuity Starting Date which is payable,
subject to the provisions of Section 4.1 hereof, in the event of his normal
retirement, early retirement, disability retirement or termination of service,
as determined and specified in Section 2.1, 2.2, 2.3 or 2.4(A) hereof, whichever
is applicable, such Participant may, subject to the requirements of this
section, elect, in writing filed with the Committee, to receive a retirement
income or benefit of equivalent actuarial value which is payable in accordance
with one of the options described below commencing on his regularly scheduled
Annuity Starting Date or commencing on such later date, which shall not be later
than his Required Beginning Date, as the Participant may specify in his written
election filed with the Committee.
Option 1: A retirement income of modified monthly amount that
is payable in equal monthly amounts to the
Participant for his lifetime, and, in the event that
the Participant predeceases a joint pensioner
designated by him, a percentage, which is not less
than 50% nor greater than 100% and is specified by
the Participant in his written election filed with
the Committee, of such modified monthly amount will
be payable after the death of the Participant to
such designated joint pensioner for the lifetime of
such joint pensioner. This option is referred to
herein as the "Qualified Joint and 50% Survivor
Annuity Option" when the spouse of the Participant
is the designated joint pensioner and the specified
percentage is 50%.
Option 2: A retirement income of modified monthly amount that
is payable in equal monthly amounts to the
Participant during the joint lifetime of the
Participant and a joint pensioner designated by him,
and, following the death of either of them, a
percentage, which is not less than 50% nor greater
than 100% and is specified by the Participant in his
written election filed with the Committee, of such
modified monthly amount will be payable to the
survivor for the lifetime of the survivor.
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Option 3: A retirement income that is payable in equal monthly
amounts to the Participant for his lifetime or in
the manner described under Option 1 or Option 2,
whichever is elected by the Participant, with the
added provision that payments will be made for the
remainder of a period certain, specified by the
Participant in his written election filed with the
Committee, in the event of the death of the
Participant and, if applicable, his Beneficiary or
joint pensioner prior to the expiration of such
specified period certain.
The amount of retirement income determined under any of the above optional
forms of payment must satisfy the requirements of Section 4.8 hereof and Section
401(l) and/or Section 401(a)(4) of the Internal Revenue Code. Any provisions
hereof to the contrary notwithstanding, any optional form of payment which would
otherwise be permitted under the provisions of this Section 3.1 shall not be
available to a Participant if:
(1) the amount of retirement income payable under such option does not
satisfy the required distribution and incidental benefit requirements
of Section 4.8 hereof; or
(2) the amount of retirement income payable under such option would result
in the amount of retirement income payable on behalf of such
Participant under the Plan being increased by a percentage that would
cause the disparity in the rate of employer-derived benefits under the
Plan to exceed the maximum disparity permitted under Section 401(l) of
the Internal Revenue Code and rulings and regulations issued with
respect thereto; provided, however, that the restriction of this
Subparagraph (2) shall not apply if there is no disparity within the
meaning of Section 401(l) of said Code included in the calculation of
the Participant's accrued benefit or if it has been determined that
the accrued benefits under the Plan satisfy the general test for
nondiscrimination in amount of benefits (or any acceptable alternative
test that may be available) under Section 401(a)(4) of the Internal
Revenue Code and rulings and regulations issued with respect thereto.
A Participant who is not permitted to elect an optional form of payment
otherwise permitted under the provisions of this Section 3.1 because of the
incidental benefit requirements of Section 4.8 hereof and/or the permitted
disparity requirements of said Section 401(l) of the Internal Revenue Code may
elect in accordance with the provisions above to receive an actuarially
equivalent form of payment which is similar in form to the non-permissible
option but which is modified by increasing or decreasing, as the case may be,
3-3
the period certain for which payments will be made and/or the percentage of
income payable to the survivor, but not to exceed 100%, so that the requirements
of Section 4.8 hereof and/or Section 401(l) of the Internal Revenue Code are
satisfied.
Any optional form of payment designated by a Participant prior to January
1, 1984, which satisfies the transitional rule in Section 242(b)(2) of the Tax
Equity and Fiscal Responsibility Act of 1982 (P.L. 97-248), will continue in
effect on and after the Effective Date of the Plan unless such optional form of
payment has been or is subsequently revoked or changed (a change of
Beneficiaries under the designation will not be considered to be a revocation or
change of such optional form of payment so long as the change in Beneficiaries
does not alter, directly or indirectly, the period over which distributions are
to be made under such form of payment); provided, however, that the provisions
of Section 4.1(C) hereof shall apply if the Participant has a spouse at the date
on which his initial payment under such optional form is due and his spouse does
not consent to such optional form of payment. Subject to the preceding sentence
but notwithstanding any other provision of this Section 3.1 to the contrary, any
option elected under this Section 3.1 must provide that the entire interest of
the Participant will be expected to be distributed to the Participant and his
Beneficiaries and joint pensioners, in a manner that satisfies the restrictions
of Section 4.8 of the Plan, over one or a combination of the following periods:
(a) the life of the Participant;
(b) the lives of the Participant and his designated Beneficiary or joint
pensioner;
(c) a period certain not extending beyond the life expectancy of the
Participant;
or
(d) a period certain not extending beyond the joint life and last survivor
expectancy of the Participant and his designated Beneficiary or joint
pensioner.
Any amount that is payable to the child of a Participant under an optional form
of payment hereunder shall be treated for the purposes of satisfying the
requirements of this paragraph as if it had been payable to the surviving spouse
3-4
of the Participant if such amount that is payable to the child will become
payable to such surviving spouse upon such child's reaching majority (or upon
the occurrence of such other designated event permitted under regulations issued
with respect to Section 401(a)(9) of the Internal Revenue Code).
If a Participant's retirement income benefits have commenced in either the
form and amount specified in Section 2 hereof or under an optional form elected
under the provisions of this Section 3.1, upon his written request to the
Committee at least 30 but not more than 90 days prior to the effective date
thereof (or if the Participant waives the 30-day notice period with any required
spousal consent, then more than 7 days but not more than 90 days prior to the
effective date thereof), he may elect to discontinue receiving his retirement
income under such form and amount of payment and, in lieu thereof, to receive on
and after such effective date a retirement income or benefit of equivalent
actuarial value that is payable to him for life or is payable in accordance with
one of the options provided above; provided, however, that (a) only one such
change may be made by any Participant after his retirement income payments have
commenced (b) a change after the Annuity Starting Date will not be permitted if
the retirement income or benefit payments are being made under the terms of an
annuity contract purchased on behalf of the Participant from an insurance
company. A Participant who elects to change his form of payment after his
Annuity Starting Date must submit to the Committee such evidence of his good
health as the Committee requires and, if the Participant is receiving payments
in a form in which a joint pensioner is involved, such evidence of the good
health of his joint pensioner as the Committee requires; and any such change
will not be permitted if, in the opinion of the Committee, such Participant or,
if applicable, such joint pensioner is not in good health. The consent of the
Participant's spouse (which shall include, if applicable, his former spouse to
whom he was married on his Annuity Starting Date), if any, shall be required
3-5
before any such change in a form of payment that involves such spouse may become
effective, including any change that represents a change in a form of payment
that was previously consented to by such spouse, unless, to the extent permitted
by law, the previous consent acknowledged that the Participant may change the
form of payment without the further consent of said spouse.
The Participant upon electing any option of this section will designate the
joint pensioner or Beneficiary to receive the benefit, if any, payable under the
Plan in the event of his death and will have the power to change such
designation from time to time, subject to the provisions of this section. Any
such designation will name a joint pensioner or one or more primary
Beneficiaries where applicable. Any change in a joint pensioner after the
Participant's retirement income payments have commenced will be considered and
treated under the Plan in the same manner as, and will be subject to the same
restrictions that apply to, a change in the form of payment. The consent of the
Participant's spouse (which shall include, if applicable, his former spouse to
whom he was married on his Annuity Starting Date), if any, shall be required
before any such change in a Beneficiary or joint pensioner, under an option in
which such spouse is not the primary Beneficiary or joint pensioner, may become
effective, unless, to the extent permitted by law, such spouse has previously
consented to and acknowledged that the Participant may change Beneficiaries or
joint pensioners without the further consent of said spouse. A Participant who
wants to change any designated joint pensioner after his retirement income
payments have started must submit to the Committee such evidence of the good
health of any joint pensioner that is being removed as the Committee requires,
and any such change shall be denied if, in the opinion of the Committee, such
joint pensioner is not in good health. The amount of retirement income payable
to the Participant upon the designation of a new joint pensioner shall be
actuarially redetermined, taking into account the age of the former joint
pensioner, the new joint pensioner and the Participant. Each such designation
will be made in writing on a form prepared by the Committee. In the event that
3-6
no designated Beneficiary survives the Participant, such benefits as are payable
in the event of the death of the Participant subsequent to his retirement shall
be paid as provided in Section 5.2 hereof.
Retirement income payments will be made under the option elected in
accordance with the provisions of this section and will be subject to the
following limitations:
(A) If a Participant's service is terminated by reason of his death
prior to his Annuity Starting Date, no benefit will be payable
under the option to any person, but a benefit may be payable on
his behalf in accordance with the provisions of Section 2.4(B)
hereof.
(B) If a terminated Participant dies after the date of termination of
his service and prior to his Annuity Starting Date, no benefit
will be payable under the option to any person, but a benefit may
be payable on his behalf under the provisions of Section
2.4(A)(3) hereof.
(C) In the case of a Participant who is married and who elects an
option under which the commencement of payment of his retirement
income is deferred beyond his regularly scheduled Annuity
Starting Date, the option elected by such Participant must
provide that a monthly lifetime income equal to or greater than a
qualified preretirement survivor annuity (within the meaning of
Section 417(c) of the Internal Revenue Code) will be payable to
his surviving spouse in the event of his death after such
regularly scheduled Annuity Starting Date and prior to his
elected Annuity Starting Date unless his spouse consents to the
option not providing such an income.
(D) If the designated Beneficiary or joint pensioner dies before the
Participant's Annuity Starting Date, the option elected will be
cancelled automatically and the retirement income payable to the
Participant will be paid in the applicable form described in
Section 2 hereof unless a new election is made in accordance with
the provisions of this section or unless a new Beneficiary or
joint pensioner is designated by the Participant prior to the
date that his retirement income commences under the Plan.
(E) If the Participant and, if applicable, his joint pensioner and
his designated Beneficiary all die after the Participant's
Annuity Starting Date but before the full payment has been
effected under any option providing for payments for a period
certain and if the commuted value of the remaining payments is
equal to or less than the maximum amount that is permissible as
an involuntary cash-out of accrued benefits under Sections
411(a)(11) and 417(e) of the Internal Revenue Code and
regulations issued with respect thereto, the commuted value of
the remaining payments shall, subject to the provisions of
Section 3.2 hereof, be paid in a lump sum in accordance with the
provisions of Section 5.3 hereof.
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(F) If the Participant dies after his Annuity Starting Date, payment
of his remaining interest, if any, shall be distributed, to the
extent required by Section 401(a)(9) of the Internal Revenue Code
and regulations issued thereunder, at least as rapidly as
provided under the method of payment in effect prior to his
death.
3.2 - LUMP-SUM PAYMENT OF SMALL RETIREMENT INCOME
Notwithstanding any provision of the Plan to the contrary, if the
single-sum value of the retirement income or other benefit payable on behalf of
any Participant hereunder whose retirement income or other benefit payments have
not commenced does not exceed $5,000, the following provisions shall apply. A
distribution under this Section 3.2 will not be permitted after the Annuity
Starting Date and will not be permitted in the case of a Participant who is
entitled to disability retirement income payments. For the purposes of the Plan,
a payment shall not be considered to occur after the Annuity Starting Date
merely because actual payment is reasonably delayed for calculation of the
benefit amount if all payments due are actually made. Once a determination has
been made by the Committee as to whether or not a lump-sum payment may be
payable as of the date of termination of the Participant's service under the
provisions of this Section 3.2, calculations shall not be required as of any
subsequent date to determine whether or not a lump-sum amount is payable under
this Section 3.2; provided, however, that the Committee shall have the right
(but shall be under no obligation) to establish, on a nondiscriminatory and
uniformly applied basis, subsequent dates as of which calculations shall be made
to determine whether or not (due to changes in the actuarial assumptions used to
compute lump-sum distributions or due to a change in the maximum permissible
involuntary cash-out amount) lump-sum amounts are payable under this Section 3.2
as of any such subsequent date on behalf of those Participants whose service had
been terminated prior to such date but whose retirement income or other benefit
payments have not commenced.
3-8
(A) Involuntary Cash-Out: If the single-sum value of the benefit payable to
the Participant does not exceed $1,000, or if the benefit is payable to a
Beneficiary and the single-sum value does not exceed $5,000, the actuarial
equivalent of such benefit shall be paid in a lump sum.
(B) Voluntary Cash-Out: If the single-sum value of the benefit payable to
the Participant is greater than $1,000 but does not exceed $5,000, the
Participant may elect to receive the actuarial equivalent (determined using the
interest and mortality assumptions that are being used as of the Annuity
Starting Date to determine actuarially equivalent lump-sum distributions) of
such benefit in a lump-sum distribution. Such election must be in writing and
must be filed with the Committee within 90 days after the date as of which the
Committee informs him in writing of the actuarially equivalent value of such
benefits. Payment of the elected benefit must be made or commence within 90 days
after such election.
(C) Lump-Sum Cash-Out of Zero Vested Accrued Benefits: For the purposes of
the Plan, if the present value of the vested accrued benefit that is payable on
behalf of any Participant whose service is or has been terminated (either
before, on or after the Effective Date of the Plan) is zero, the Participant
shall be deemed to have received a distribution of such vested accrued benefit
as of the date of termination of his service.
3.3 - BENEFITS APPLICABLE TO PARTICIPANT WHO HAS BEEN OR IS EMPLOYED BY TWO OR
MORE EMPLOYERS
In the event that a Participant's service is terminated for any reason and
such Participant has been or is employed by any two or more Employers, his
retirement or termination benefit, if any, shall be computed by applying the
benefit formulas as if all the Employers were a single Employer; provided,
however, if the Plan does not represent an IRC 414(l) Single Plan with respect
to all such Employers, there shall be a proper allocation (taking into account
the Credited Service and Compensation applicable to each Employer or group of
Employers with respect to which the Plan represents an IRC 414(l) Single Plan)
3-9
of the costs of the resulting benefits among the Employers (with respect to
which the Plan does not represent an IRC 414(l) Single Plan) by which such
Participant has been or is employed.
3.4 - NO DUPLICATION OF BENEFITS
Unless the context clearly provides otherwise, there shall be no
duplication of benefits under the Plan or under any Supplement hereto, and the
benefits payable under any section of the Plan to or on behalf of a Participant
shall be inclusive of the benefits, if any, concurrently payable to or on behalf
of the same Participant under all other sections of the Plan and under any
Supplement hereto.
3.5 - FUNDING OF BENEFITS THROUGH PURCHASE OF LIFE INSURANCE CONTRACT OR
CONTRACTS
In lieu of paying benefits from the Trust Fund to a Participant or his
Beneficiary, upon direction of the Committee with specific prior authorization
in writing from the Employer, the Trustee shall enter into a contract or
contracts, or an agreement or agreements, with one or more legal reserve life
insurance companies for the purchase, with funds in the Trust, of a retirement
annuity or other form of life insurance contract which, as far as possible,
provides benefits equal to (or actuarially equivalent to) those provided in the
Plan for such Participant or Beneficiary, but provides no optional form of
retirement income or benefit which would not be permitted under Section 3.1
hereof, whereupon such contract shall thereafter govern the payment of the
amount of benefit, if any, represented by such contract, which is payable under
the Plan upon the Participant's retirement or termination of service, and the
liability of the Trust Fund and of the Plan will cease and terminate with
respect to such benefits that are purchased and for which the premiums are duly
paid.
Any policy or contract issued under this section shall be subject to the
provisions hereof pertaining to the Qualified Joint and 50% Survivor Annuity
Option and to the Qualified Preretirement Survivor Annuity.
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Any policy or contract issued under this section prior to the termination
of the Plan or prior to the distribution of the policy or contract to a
Participant or Beneficiary hereunder shall provide that the Trustee shall retain
all rights of ownership at all times except the right, unless such policy or
contract provides otherwise, to designate the Beneficiary to receive any
benefits payable upon the death of the Participant and shall further provide
that all dividends or experience rating credits shall be paid to the Trustee and
applied to reduce future Employer contributions to the Plan.
Any annuity contract distributed by the Trustee to a Participant or
Beneficiary hereunder shall contain a provision to the effect that the contract
may not be sold, assigned, discounted or pledged as collateral for a loan or as
security for the performance of an obligation or for any other purpose, to any
person other than the issuer thereof.
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SECTION 4
GOVERNMENTAL REQUIREMENTS AFFECTING BENEFITS
4.1 - SPECIAL PROVISIONS REGARDING AMOUNT AND PAYMENT OF RETIREMENT INCOME
The amount and payment of retirement income determined under Sections 2.1,
2.2, 2.3 and 2.4 hereof shall be subject to the following provisions of this
Section 4.1.
(A) Limitations Imposed by Section 415 of Internal Revenue Code:
(1) Maximum Amount of Retirement Income: Any provisions herein to the
contrary notwithstanding, in no event shall the monthly retirement income that
is payable on or after the first day of the limitation year beginning in 1987 to
a Participant hereunder exceed the maximum amount of retirement income for
defined benefit plans as specified in Section 415 of the Internal Revenue Code
and regulations and rulings issued pursuant thereto; provided, however, that:
(a) the maximum amount of retirement income applicable to a
Participant who was a participant in the Superseded Plan, if
any, before the limitation year beginning in 1983 and whose
Credited Service includes service that was accrued prior to
such limitation year, shall not be less than his current
accrued benefit within the meaning of Section 235(g)(4) of
the Tax Equity and Fiscal Responsibility Act of 1982;
and
(b) such maximum amount of retirement income applicable to a
Participant who was a participant in the Superseded Plan, if
any, before the limitation year beginning in 1987 and whose
Credited Service includes service that was accrued prior to
such limitation year, shall not be less than his current
accrued benefit within the meaning of Section 1106(i)(3)(B)
of the Tax Reform Act of 1986.
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In determining the maximum monthly retirement income payable on behalf of any
Participant, all defined benefit plans (whether or not terminated) of the
Controlled Group Members are to be treated as one defined benefit plan. The
proportion of the maximum monthly retirement income applicable to all such
defined benefit plans of the Controlled Group Members shall be determined on a
pro rata basis depending upon the actuarially equivalent amount of retirement
income otherwise accrued under each such defined benefit plan.
Under Section 415 of the Internal Revenue Code, the amount of a Participant's
"annual benefit" (as such term is defined in Section 415), payable in the form
of a straight life annuity, for any limitation year that is produced by the
amount of such Participant's monthly retirement income shall not exceed the
lesser of:
(c) $160,000 (as adjusted for cost-of-living increases under
Section 415(d) of the Internal Revenue Code), or
(d) 100% of the Participant's average IRC 415 Compensation for
his highest three consecutive years of service or the actual
number of consecutive years if less than three.
(2) Actuarial Assumptions and Related Adjustments: For purposes of
determining the actuarially equivalent maximum amount of retirement income
permitted under this Section 4.1(A) with respect to any Participant, the
interest and mortality tables specified below shall control.
(a) For purposes of this Section 4.1(A)(2), the "Plan Mortality
Table" is the mortality table determined under Section
1.1(B)(1)(a) without regard to this section. The "Plan
Interest Rate" is the rate of interest determined under
Section 1.1(B)(1)(b) without regard to this section. The
"Applicable Mortality Table" is the mortality table
specified by the Secretary of Treasury pursuant to Section
415(b)(2)(E) of the Internal Revenue Code (which, as of
April 1, 2006, is based upon a fixed blend of 50% of the
unloaded male mortality rates and 50% of the unloaded female
mortality rates underlying the mortality rates in the 1994
Group Annuity Reserving Table, projected to 2002). The
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"Applicable Interest Rate" is the annual rate of interest on
30-year Treasury securities as determined by the Internal
Revenue Service for the second full calendar month
immediately preceding the first day of the Plan Year during
which the Annuity Starting Date occurs.
(b) For the purposes of determining whether any benefit payable
under the Plan in any form which is not subject to Section
417(e)(3) of the Internal Revenue Code exceeds the maximum
retirement income under Section 4.1(A), such benefit shall
be converted to an actuarially equivalent straight life
annuity beginning at the same age. The interest rate and
mortality table used in such calculation shall be either (i)
the Plan Interest Rate and the Plan Mortality Table or (ii)
5% and the Applicable Mortality Table, whichever yields the
greater amount.
(c) For the purposes of determining whether any benefit payable
under the Plan in any form which is subject to Section
417(e)(3) of the Internal Revenue Code, (which shall include
lump-sum distributions and other forms of distribution that
provide payments in the form of a decreasing annuity or that
provide payments for a period less than the life of the
recipient) exceeds the maximum retirement income under
Section 4.1(A), such benefit shall be converted to an
actuarially equivalent straight life annuity beginning at
the same age. The interest rate and mortality table used in
such calculation shall be either (i) the Plan Interest Rate
and the Plan Mortality Table or (ii) the Applicable Interest
Rate and the Applicable Mortality Table, whichever yields
the greater amount.
(d) If the benefit of a Participant begins after the Participant
attains age 65, the defined benefit dollar limitation
applicable to the Participant at the later age shall be the
annual benefit payable in the form of a straight life
annuity beginning at the later age that is actuarially
equivalent to the defined benefit dollar limitation
applicable to the Participant at age 65 (adjusted under (f)
below, if required). The actuarial equivalent of the defined
benefit dollar limitation applicable at an age after age 65
shall be determined as the lesser of (i) the actuarial
equivalent (at such age) of the defined benefit dollar
limitation computed using the Plan Interest Rate and the
Plan Mortality Table, and (ii) the actuarial equivalent (at
such age) of the defined benefit dollar limitation computed
using a 5 percent interest rate assumption and the
Applicable Mortality Table. For these purposes, mortality
between age 65 and the age at which benefits commence shall
be ignored.
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(e) If the benefit of a Participant begins prior to age 62, the
defined benefit dollar limitation applicable to the
Participant at such earlier age shall be an annual benefit
payable in the form of a straight life annuity beginning at
the earlier age that is the actuarial equivalent of the
defined benefit dollar limitation applicable to the
Participant at age 62 (adjusted under (f) below, if
required). The defined benefit dollar limitation applicable
at an age prior to age 62 is determined as the lesser of (i)
the actuarial equivalent (at such age) of the defined
benefit dollar limitation computed using the Plan Interest
Rate and the Plan Mortality Table, and (ii) the actuarial
equivalent (at such age) of the defined benefit dollar
limitation computed using a 5 percent interest rate and the
Applicable Mortality Table. Any decrease in the defined
benefit dollar limitation determined in accordance with this
paragraph (e) shall not reflect a mortality decrement if
benefits are not forfeited upon the death of the
Participant. If any benefits are forfeited upon death, the
full mortality decrement shall be taken into account.
(f) If the Participant has less than ten years of participation
in the Plan, the maximum dollar limitation under Section
415(b)(1)(A) of the Internal Revenue Code otherwise
applicable to the Participant shall be multiplied by a
fraction the numerator of which is the number of years (or
part thereof) of participation in the Plan, and the
denominator of which is ten. In the case of a Participant
who has less than ten years of service with the Controlled
Group Members, the percentage of compensation limitation
under Section 415(b)(1)(B) of the Internal Revenue Code
shall be multiplied by a fraction the numerator of which is
the number of the Participant's years (or part thereof) of
service with the Controlled Group Members, and the
denominator of which is ten.
(3) Cost-of-Living Adjustments: In the event that the maximum amount of
retirement income permitted under Section 415 of the Internal Revenue Code is
increased after the date of commencement of a Participant's retirement income
due to any cost-of-living adjustment announced by the Internal Revenue Service
pursuant to the provisions of Section 415(d) of the Internal Revenue Code, the
amount of monthly retirement income payable under the Plan to a Participant
whose retirement income is restricted due to the provisions of such section of
the Internal Revenue Code shall be increased, effective as of January 1st of the
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calendar year for which such increase becomes effective or, if applicable, as of
such other date as the Secretary of the Treasury or his delegate may prescribe
as the date on which such increase shall become effective, to reflect the
increase in the amount of retirement income that may be payable under the Plan
as a result of such cost-of-living adjustment; provided, however, if the
Employer maintains a plan for the purpose of restoring benefits that certain
Participants may not receive under the Plan due to the limitations on
contributions and benefits imposed by Section 415 of the Internal Revenue Code
and/or due to the limitations imposed on Compensation under Section 401(a)(17)
of said Code and if the Participant or his Beneficiary receives or has received
a benefit or benefits under such restoration plan and a portion of such benefit
or benefits would be duplicated by the cost-of-living adjustment provided under
this paragraph, then such cost-of-living adjustment that would represent a
duplication of benefits shall not apply to the Participant or Beneficiary unless
the value of the benefit payable from the restoration plan that would cause such
duplication of benefits under this Plan is returned to the Employer by the
Participant or Beneficiary within 60 days of the effective date of such
cost-of-living adjustment or the date that such cost-of-living adjustment is
announced by the Internal Revenue Service, whichever date is later; and provided
further, however, that such 60-day period may be extended by the Committee if,
in its opinion, reasonable cause exists for such an extension.
(4) IRC Section 415 Definitions: Following are certain terms that are used
herein for the purposes of the limitations under Section 415 of the Internal
Revenue Code and that shall have the meanings assigned to them in Section 415 of
said Code and regulations and rulings issued with respect thereto:
(a) The term "defined benefit plan" shall have the meaning
assigned in Section 414(j) of the Internal Revenue Code.
(b) The term "IRC 415 Compensation" shall include (i) wages,
salaries, fees for professional services, and other amounts
received (without regard to whether or not an amount is paid
in cash) for personal services actually rendered in the
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course of employment with the Employer to the extent that
the amounts are includable in gross income (including, but
not limited to, commissions paid salesmen, compensation for
services on the basis of a percentage of profits,
commissions on insurance premiums, tips, bonuses, fringe
benefits, reimbursements and expense allowances), (ii)
earned income (as described in Section 401(c)(2) of the
Internal Revenue Code and the regulations thereunder), (iii)
amounts described in Sections 104(a)(3), 105(a) and 105(h)
of the Internal Revenue Code, but only to the extent that
these amounts are includable in the gross income of the
Participant, (iv) amounts paid or reimbursed by the Employer
for moving expenses incurred by the Participant, but only to
the extent that these amounts are not deductible by the
Participant under Section 217 of the Internal Revenue Code,
(v) the value of a non-qualified stock option granted to the
Participant by the Employer, but only to the extent that the
value of the stock option is includable in the gross income
of the Participant for the taxable year in which granted,
(vi) the amount includable in the gross income of the
Participant upon making the election described in Section
83(b) of the Internal Revenue Code and (vii) any amounts
received by the Participant pursuant to an unfunded
non-qualified plan in the year such amounts are includable
in the gross income of the Participant. The amounts
described in (i) and (ii) above shall include foreign earned
income as defined in Section 911(b) of the Internal Revenue
Code, whether or not excludable from gross income under
Section 911 of said Code. The term "IRC 415 Compensation"
shall also include (i) any elective deferral as defined in
Section 402(g)(3) of the Internal Revenue Code, and (ii) any
amount which is contributed or deferred by the Employer at
the election of the Employee and which is not includible in
the gross income of the Employee by reason of Section 125,
Section 132(f)(4), or Section 457 of the Internal Revenue
Code. Such compensation shall exclude (1) contributions by
the Employer to a plan of deferred compensation which are
not included in the Participant's gross income for the
taxable year in which contributed (except as provided above
in this subsection (b)), (2) contributions by the Employer
under a simplified employee pension plan to the extent such
contributions are deductible by the Participant, (3) any
distribution from a plan of deferred compensation, (4)
amounts realized from the exercise of a non-qualified stock
option, (5) amounts realized when restricted stock (or
property) held by the Participant either becomes freely
transferable or is no longer subject to a substantial risk
of forfeiture, (6) amounts realized from the sale, exchange
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or other disposition of stock acquired under a qualified
stock option, (7) other amounts which received special tax
benefits and (8) contributions made by the Employer (whether
or not under a salary reduction agreement) towards the
purchase of an annuity described in Section 403(b) of the
Internal Revenue Code (whether or not the amounts are
actually excludable from the gross income of the
Participant). Amounts under Section 125 include any amounts
not available to a Participant in cash in lieu of group
health coverage because the Participant is unable to certify
that he has other health coverage; provided that such an
amount shall be treated as an amount under Section 125 only
if the Employer does not request or collect information
regarding such Participant's other health coverage as part
of the enrollment process for the health plan.
(c) The term "limitation year" is the 12-month period which is
used for application of the limitations under Section 415 of
the Internal Revenue Code and, unless a different 12-month
period has been elected by the Employer in accordance with
rules or regulations issued by the Internal Revenue Service
or the Department of Labor, shall be the calendar year.
(B) Minimum Benefits on Normal or Early Retirement: Any provisions of
Section 2.1 or 2.2 hereof to the contrary notwithstanding, in the event of the
normal retirement or early retirement of a Participant in accordance with the
provisions of Section 2.1 or 2.2 hereof, his monthly retirement income
determined in accordance with the provisions of Section 2.1(B) or 2.2(B) hereof,
whichever is applicable, shall not be less than the monthly retirement income,
if any, determined in accordance with the provisions of Section 2.1(B) or 2.2(B)
hereof that such Participant would have received as of any earlier date of
retirement if he had retired under the provisions of Section 2.1 or 2.2 at any
time prior to his actual date of retirement.
(C) Requirement With Respect to Form of Payment: The Committee shall
provide each Participant, during the period beginning 90 days before his Annuity
Starting Date and ending 30 days before his Annuity Starting Date (or as soon
after the expiration of such period as is administratively practicable), a
written notification of his optional forms of payment. Such written notification
shall set forth an explanation of:
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(1) if the Participant is married:
(a) the terms and conditions of the Qualified Joint and 50%
Survivor Annuity form of payment;
(b) the Participant's right to elect, and the effect of
electing, to waive the Qualified Joint and 50% Survivor
Annuity form of payment;
(c) the rights of the Participant's spouse; and
(d) the right to revoke, and the effect of revoking, an election
to waive the Qualified Joint and 50% Survivor Annuity form
of payment;
(2) the eligibility conditions and material features of the optional forms
of payment available under the Plan;
(3) the financial effect of electing each optional form of payment;
(4) in the event the notification described herein is required and is
provided to the Participant after his Annuity Starting Date, the
Participant's right to elect a retroactive Annuity Starting Date;
(5) the relative values of the optional forms of payment available under
the Plan; and
(6) such other information as may be required under applicable
regulations.
The written notification described above shall not be required if the single-sum
value of the Participant's retirement income is less than or equal to $5,000.
In the event the written notification described above is required and is
provided to the Participant after the Participant's Annuity Starting Date, the
Participant's Annuity Starting Date shall be deemed to be his "retroactive
Annuity Starting Date," and the provisions of Section 4.1(J) shall apply.
Any provisions of Section 2.1, 2.2, 2.3, 2.4(A) or 3.1 hereof to the
contrary notwithstanding, if a Participant does not elect, in writing filed with
the Committee during the election period described below, to receive the
retirement income payable on his behalf on and after his Annuity Starting Date
either (i) under the form of payment that is specified in Section 2.1(C),
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2.2(C), 2.3(F) or 2.4(A)(2), whichever is applicable, or (ii) under an optional
form of payment described in and subject to the provisions of Section 3.1
hereof, such Participant shall be deemed to have elected, and the retirement
income payable on and after his Annuity Starting Date shall automatically be
paid in accordance with the provisions of, either:
(1) if he does not have a spouse at his Annuity Starting Date, the form of
payment that is specified in Section 2.1(C), 2.2(C), 2.3(F) or
2.4(A)(2), whichever is applicable; or
(2) if he has a spouse at his Annuity Starting Date, the Qualified Joint
and 50% Survivor Annuity Option.
Any Participant may make an election under this section at any time (and any
number of times) prior to the commencement of his retirement income or other
benefit payments and during the period beginning on the date which is 90 days
prior to his Annuity Starting Date and ending on the latest to occur of (i) his
Annuity Starting Date, (ii) the date which is 90 days after the date on which he
was provided with the general written explanation described above or (iii) the
date which is 90 days after the date on which he was provided with any specific
detailed information concerning the payment of his retirement income that is
required to be furnished due to the request of the Participant. If any such
Participant does not file his election with the Committee prior to the
expiration of the election period described above, the commencement of his
retirement income will be delayed until the end of such election period, but he
will be entitled to a retroactive payment with respect to those retirement
income payments which were delayed. If any Participant has elected a form of
payment other than the automatic form provided above and his retirement income
or other benefit payments have not commenced, he may subsequently revoke such
election, in writing filed with the Committee within the election period
described above, in order to receive his retirement income payable in accordance
with the automatic form provided above. Any provisions of Section 3.1 hereof to
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the contrary notwithstanding, if any Participant is not provided with the
written notification described in the first sentence of this section at least 30
days before his Annuity Starting Date but is provided in the written
notification a period of at least 30 days in which to make his election under
this section, he may waive such notice period (with any applicable spousal
consent) and file his election with the Committee, and his retirement income or
other benefit may commence within 30 days after the date on which he was
provided with such written notification, but more than 7 days after such date.
Any provisions herein to the contrary notwithstanding, the written consent of
the Participant's spouse during the applicable election period shall be required
in order for the Participant to receive his retirement income in a form other
than that provided under a Qualified Joint and Survivor Annuity.
(D) Qualified Preretirement Survivor Annuity: If a deceased Participant,
whose death occurs on or after his Initial Vesting Date and prior to his Annuity
Starting Date, had been married to his spouse throughout the one-year period
immediately preceding his death and he had designated a person other than his
spouse as his Beneficiary and such spouse has not validly consented to such
other person being designated as the Beneficiary, the Participant shall be
deemed to have:
(1) revoked his prior designation of Beneficiary;
(2) designated such spouse as his Beneficiary to receive a portion of the
death benefit payable on his behalf under Section 2.3(G), 2.4(A)(3) or
2.4(B), whichever is applicable;
(3) specified that the portion of the benefit provided under Section
2.3(G), 2.4(A)(3) or 2.4(B) that is payable to his surviving spouse
will be payable as an actuarially equivalent monthly income payable on
the first day of each month with the first payment being due (only if
said spouse is then living) on the Participant's Normal Retirement
Date or the first day of the month coincident with or next following
the date of the Participant's death, whichever is later, and with the
last payment being the payment due immediately preceding such spouse's
death;
(4) specified that the portion of the benefit provided under Section
2.3(G), 2.4(A)(3) or 2.4(B) that is payable to the surviving spouse
shall have an actuarially equivalent single-sum value, determined as
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of the date of his death, equal to the single-sum value, determined as
of the date of his death, of the monthly retirement income that would
be payable to his surviving spouse, commencing on the Participant's
Earliest Annuity Commencement Date, under the Qualified Joint and 50%
Survivor Annuity Option if:
(a) the Participant's service had been terminated on the date of his
death for a reason other than disability retirement or death (or,
if the Participant is a vested terminated Participant entitled to
a benefit under Section 2.4(A) hereof, he had survived to the
Earliest Annuity Commencement Date);
(b) the Participant had (for the purposes of determining the amount
of such monthly retirement income commencing at his Earliest
Annuity Commencement Date) waived the death benefit coverage
under Section 2.4(A)(3) hereof, if applicable, during the period
beginning on the date of his death and ending on his Earliest
Annuity Commencement Date; and
(c) the Participant had died immediately after such commencement of
payments (one-half of the initial payment which would have been
due the Participant on his Earliest Annuity Commencement Date
shall be included in the determination of such single-sum value);
and
(5) designated such other person (or persons) that was named as his
Beneficiary under such revoked designation as the Beneficiary to
receive the remaining portion of such benefit payable on his behalf
under and in accordance with the provisions of Section 2.3(G),
2.4(A)(3) or 2.4(B) hereof.
In lieu of the payment of such benefit to the surviving spouse of a Participant
in the form of the monthly income described in Section 4.1(D)(3) above
commencing at the Participant's Normal Retirement Date, such benefit may be paid
on an actuarially equivalent basis to the Participant's spouse in such other
manner and form permitted under Section 2.4(B) hereof and commencing on such
other date permitted under Section 2.4(B) hereof as the surviving spouse may
elect in writing filed with the Committee. For the purposes of Sections
4.1(D)(3) and 4.1(D)(4) above, the Earliest Annuity Commencement Date of a
deceased disabled Participant on whose behalf a death benefit is payable under
Section 2.3(G) hereof and the monthly retirement income that would be payable to
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his surviving spouse, commencing on his Earliest Annuity Commencement Date,
under the Qualified Joint and 50% Survivor Annuity Option, shall be determined
as though such Participant had recovered from his total and permanent disability
and had reentered the service of the Employer immediately prior to his death.
Except to the extent that it is otherwise permissible under the provisions
of Section 417 (or any other applicable section) of the Internal Revenue Code or
regulations or rulings issued pursuant thereto for such a spouse to elect to
waive his right to the qualified preretirement survivor annuity, the consent of
the Participant's spouse to another person being designated as the Beneficiary
of the Participant shall be valid for the purposes of this Section 4.1(D) only
if such consent satisfies the requirements of Section 4.1(E) hereof and the
Participant was given a written explanation of the Qualified Preretirement
Survivor Annuity (containing the information described in the paragraph below)
prior to obtaining such consent; provided, further, in the event that the
Participant's death occurs on or after the beginning of the Plan Year in which
he attained the age of 35 years, such consent in order to be valid must have
been given on or after the beginning of the Plan Year in which the Participant
attained the age of 35 years or after his separation from service.
The Committee shall provide each Employee, who is a Participant in the
Plan, within the one-year period immediately following (a) the beginning of the
Plan Year in which he will attain the age of 32 years or (b) the date on which
he becomes a Participant in the Plan, whichever is later, or, if his service is
terminated on or after his Initial Vesting Date and prior to his attaining the
age of 32 years, within the one-year period immediately following the date of
termination of his service, or as soon thereafter as is administratively
practicable, with written notification of (i) the terms and conditions upon
which the Qualified Preretirement Survivor Annuity described above will be
payable to his surviving spouse, (ii) the Participant's right to designate at
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any time prior to his death a person other than his spouse as his Beneficiary
and the effect that such a designation will have on the Qualified Preretirement
Survivor Annuity, (iii) the rights of the Participant's spouse in the event that
the spouse does not consent to such designation and (iv) the right of the
Participant to change his Beneficiary designation in accordance with the
provisions of Section 5.2 hereof at any time prior to his death and the effect
that such a change will have upon the Qualified Preretirement Survivor Annuity.
If the Beneficiary of a Participant is his spouse but the Participant
elects, pursuant to the provisions of Section 2.4(A)(3) or 2.4(B) hereof,
whichever is applicable, an actuarially equivalent form of payment of the
benefit provided under such applicable section that does not provide for monthly
payments during the lifetime of his spouse in an amount at least as great as the
minimum qualified preretirement survivor annuity required under Section 417 of
the Internal Revenue Code, the Committee shall inform such Participant that such
election will constitute an election not to receive a benefit which has the
effect of a qualified preretirement survivor annuity provided under a qualified
joint and survivor annuity as described in Section 417 of the Internal Revenue
Code, and the consent of the Participant's spouse shall be required in order for
such an election to become effective.
There shall be no duplication between the benefits provided under Sections
2.3(G), 2.4(A)(3) and 2.4(B) and under the Qualified Preretirement Survivor
Annuity described in this Section 4.1(D), but the benefits under each shall be
inclusive of the benefits under the other.
(E) Spousal Consent Requirement and Waiver: Any provisions herein to the
contrary notwithstanding, if the consent of the spouse of the Participant is
required for any reason under the provisions hereof, such consent in order to be
effective must be in writing and witnessed by a Plan representative or a notary
public. In the event that such consent is with respect to the election of a form
of payment other than a Qualified Joint and Survivor Annuity or the designation
of a person other than the spouse as the Participant's Beneficiary, such consent
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must acknowledge the specific form of payment that has been elected or the
person who has been designated as Beneficiary, as the case may be, and must
acknowledge the effect of such consent. Any of the above to the contrary
notwithstanding, such spousal consent for any reason hereunder shall, unless
otherwise required by the Committee or by applicable law, be waived for the
purposes of the Plan if:
(1) the spouse has previously consented to such specified action in
accordance with the provisions above and such previous consent
(a) permits changes with respect to such specified action without
any requirement of further consent by such spouse and (b)
acknowledges the effect of such consent by the spouse;
or
(2) it is established to the satisfaction of the Committee that such
consent may 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 or his delegate
may prescribe by regulations as reasons for waiving the spousal
consent requirement.
Once spousal consent, which satisfies the requirements of this section, has been
given, such consent may not be revoked by the spouse without the consent of the
Participant.
(F) Latest Date of Commencement of Payments: Except to the extent otherwise
permissible under rules or regulations issued by the Internal Revenue Service,
distribution of the accrued benefit to which a Participant has a nonforfeitable
interest must commence on a date not later than the earlier to occur of:
(1) his Required Beginning Date;
or
(2) the later of:
(a) the date that is no later than the 60th day after the close
of the Plan Year during which (i) his service is terminated
for any reason, (ii) he attains the age of 65 years or (iii)
the tenth anniversary of the date on which he initially
commenced participation in the Plan or Superseded Plan,
whichever is latest, occurs; or
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(b) the date that the Participant elects in accordance with the
provisions of Section 3.1 hereof as the date of commencement
of his retirement income;
provided, however, if an election of a form of payment has been made by a
Participant prior to January 1, 1984 that provides for the commencement of his
benefit at a date later than the date applicable under (1) or (2) above and such
election both (i) satisfies the transitional rule in Section 242(b)(2) of the
Tax Equity and Fiscal Responsibility Act of 1982 (P.L. 97-248) and (ii) has not
been subsequently revoked or changed (a change of Beneficiaries under the
designation will not be considered to be a revocation or change of such form of
payment so long as the change in Beneficiaries does not alter, directly or
indirectly, the period over which distributions are to be made under such form
of payment), distribution of the Participant's accrued benefit shall not be
required to commence prior to the date of commencement specified in such
election.
(G) No Benefit Reduction Due to Post Termination Social Security Changes:
Benefits under the Plan shall not be decreased by reason of any increase in the
benefit levels payable under Title II of the Social Security Act or by reason of
any increase in the wage base under such Title II, if such increase takes place
after September 2, 1974 or (if later) the earlier of the date of first receipt
of such benefits or the date of the Participant's separation from service, as
the case may be.
(H) Minimum Preserved Benefit Due to Certain Amendments: In the event that
the Plan or Superseded Plan has been or is amended effective as of a date on or
after July 30, 1984 to eliminate or reduce a retirement-type subsidy or an early
retirement benefit or to change the actuarial assumptions used to determine
actuarially equivalent benefits payable thereunder, the monthly retirement
income or other benefit, if any, payable under the provisions of Section 2.1,
2.2, 2.3 or 2.4 (and Section 3.1 if an optional form of payment is applicable)
to a Participant, who was a participant in the Plan or Superseded Plan as of the
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day immediately preceding the date that the elimination, reduction or change
becomes effective or the date of adoption of such amendment, whichever is later,
(herein referred to as the "Preservation Date") and who retires or whose service
is terminated after the Preservation Date, shall be at least equal to the
corresponding amount of the monthly retirement income or other benefit, if any,
payable to him under the provisions of such applicable section of the Plan (or,
if applicable, the section of the Superseded Plan that corresponds to such
applicable section of the Plan) as in effect on the Preservation Date computed
using his Credited Service, Final Average Monthly Compensation and Monthly
Covered Compensation (or, if applicable, the corresponding terms used to compute
his accrued benefit under the Superseded Plan) determined as of the Preservation
Date under the provisions of the Plan (or, if applicable, the Superseded Plan)
as in effect on such date and using, if applicable, the mortality table and
interest rate assumptions that applied under the provisions of the Plan (or, if
applicable, the Superseded Plan) as in effect on the Preservation Date to
compute actuarially equivalent benefits payable to a Participant who retired or
whose service was terminated on the Preservation Date; provided, however, such
preservation shall not be required if, under regulations or other official
pronouncements of the Internal Revenue Service, such reduction or elimination or
such change in assumptions (without the preservation described above in this
subsection) may be made without violating the anticutback rules of Section
411(d)(6) of the Internal Revenue Code.
(I) Direct Rollover Options for Eligible Rollover Distributions:
Notwithstanding any provision of the Plan to the contrary that would otherwise
limit a distributee's election under this section, a distributee may elect, at
the time and in the manner prescribed by the plan administrator, to have any
portion of an eligible rollover distribution paid directly to an eligible
retirement plan specified by the distributee in a direct rollover. The following
definitions apply to this section:
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(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:
(a) 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; and
(b) any distribution to the extent such distribution is required
under Section 401(a)(9) of the Internal Revenue Code.
(2) Eligible retirement plan: An eligible retirement plan is an individual
retirement account described in Section 408(a) of the Internal Revenue
Code, an individual retirement annuity described in Section 408(b) of
said Code, an annuity plan described in Section 403(a) or 403(b) of
said Code, an eligible governmental plan described in Section 457(b)
of said Code, or a qualified trust described in Section 401(a) of said
Code, that accepts the distributee's eligible rollover distribution.
However, in the case of an eligible rollover distribution that
includes after-tax employee contributions, an eligible retirement plan
is an individual retirement account or annuity described in Section
408(a) or (b) of the Internal Revenue Code, or a qualified defined
contribution plan described in Section 401(a) or 403(a) of said Code
that agrees to account separately for amounts so transferred,
including separately accounting for the portion of such distribution
which is includible in gross income and the portion of such
distribution which is not so includible. The definition of eligible
retirement plan shall also apply in the case of a distribution to a
surviving spouse, or to a spouse or former spouse who is the alternate
payee under a qualified domestic relation order, as defined in Section
414(p) of said Code.
(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 the
alternate payee under a qualified domestic relations order, as defined
in Section 414(p) of the Internal Revenue Code, are distributees with
regard to the interest of the spouse or former spouse.
(4) Direct rollover: A direct rollover is a payment by the Plan to the
eligible retirement plan specified by the distributee.
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Any options set forth in this section shall automatically become inoperative and
of no effect upon a ruling by the Treasury Department that the options set forth
herein are no longer required.
(J) Provisions Concerning Retroactive Annuity Starting Dates:
Notwithstanding any provision hereof to the contrary, in the event that the
written notification described in Section 4.1(C) is required and is provided to
the Participant after the Participant's Annuity Starting Date, the Participant's
Annuity Starting Date shall be deemed to be his "retroactive Annuity Starting
Date" and payment of the Participant's retirement income under Section 2.1, 2.2,
2.3, 2.4(A) or 3.1 hereof shall be made or commence in accordance with Section
417(a) of the Internal Revenue Code, and regulations and rulings issued pursuant
thereto, and the following provisions of this Section 4.1(J).
(1) Notification requirement: In the event of a retroactive Annuity
Starting Date, the written notification to the Participant required by Section
4.1(C) shall set forth the information described in Section 4.1(C) both as of
his retroactive Annuity Starting Date and as of a date which is not more than 90
days after the date on which such written notification is provided to the
Participant.
(2) Election of retroactive Annuity Starting Date: In the event of a
retroactive Annuity Starting Date, the Participant's retirement income shall be
determined and payable as of a date which is not more than 90 days after the
date on which the written notification required by Section 4.1(C) is provided to
the Participant, unless the Participant elects to have such retirement income
determined and payable as of such retroactive Annuity Starting Date. The
Participant may make such election on the appropriate form provided by the
Committee and filed with the Committee within the election period described in
Section 4.1(C).
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(3) Spousal consent requirement: In the event that (a) a Participant
elects to receive his retirement income under Section 2.1, 2.2, 2.3, 2.4(A), or
3.1 hereof determined as of a retroactive Annuity Starting Date, and (b) under
the form of payment elected by such Participant, the benefit payable to the
Participant's spouse upon the Participant's death would be less than the benefit
payable to such surviving spouse after the Participant's death if the
Participant had elected to receive a Qualified Joint and 50% Survivor Annuity
determined and payable as of the date on which his retirement income payments
actually commence, then the Participant's spouse must consent in writing to the
Participant's election of such retroactive Annuity Starting Date. Such spousal
consent requirement shall be satisfied if the Participant's spouse consents in
the manner provided in Section 4.1(C) to the Participant's election to receive
his retirement income in a form other than that provided under a Qualified Joint
and Survivor Annuity.
(4) Make-up payments with interest: In the event that a Participant
elects (with spousal consent, if applicable) to receive his retirement income
under Section 2.1, 2.2, 2.3, 2.4(A), or 3.1 hereof determined as of a
retroactive Annuity Starting Date, the Participant shall receive a make-up
payment to reflect any missed payment or payments for the period from the
retroactive Annuity Starting Date to the date of the actual make-up payment,
with an appropriate adjustment for interest from the date the missed payment or
payments would have been made (including, if applicable, a payment of the
single-sum value of the Participant's retirement income) to the date of the
actual make-up payment.
(5) Future payment amount: If the Participant elects (with spousal
consent, if applicable) to receive his retirement income determined as of a
retroactive Annuity Starting Date and the Participant receives his retirement
income in a form other than a single-sum payment, the retirement income payments
that commence after he has received the notification required by Section 4.1(C),
other than any required make-up payment, shall be in an amount that is equal to
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the amount that would have been paid to the Participant had payments actually
commenced on his retroactive Annuity Starting Date.
(6) Section 415 compliance: Except in the case where payment of the
Participant's retirement income (other than a form of payment that is subject to
Section 417(e) of the Internal Revenue Code, including lump-sum distributions
and other forms of distribution that provide payments in the form of a
decreasing annuity or for a period less than the life of the recipient)
commences no more than 12 months after the retroactive Annuity Starting Date,
payment of the Participant's retirement income, including any interest
adjustments, shall satisfy the requirements of Section 415 of the Internal
Revenue Code if the date retirement income payments actually commence is
substituted for the retroactive Annuity Starting Date for all purposes,
including for purposes of determining the applicable interest rate and the
applicable mortality table described in Section 4.1(A)(2) hereof.
(7) Section 417(e) compliance: If the retirement income received by the
Participant is in a form of payment that would have been subject to Section
417(e) of the Internal Revenue Code if payment had commenced as of the
retroactive Annuity Starting Date, then the amount of payment as of the actual
commencement date shall be no less than the amount of payment produced by
applying the applicable interest rate and the applicable mortality table
(described in Section 4.1(A)(2) hereof), determined as of the date payment
actually commences, to the annuity form that was used to determine the amount of
retirement income as of the Participant's retroactive Annuity Starting Date.
4.2 - LIMITATIONS ON BENEFITS REQUIRED BY THE INTERNAL REVENUE SERVICE
(A) Limitation in the Event of Plan Termination: In the event that the Plan
is terminated, the benefit of any Participant who is a Highly Compensated
Employee shall be limited to a benefit that is nondiscriminatory under Section
401(a)(4) of the Internal Revenue Code and regulations issued with respect
thereto.
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(B) Limitation on Annual Payments:
(1) The provisions of this Section 4.2(B) shall apply during each Plan
Year to those Participants who during such Plan Year (a) are Highly Compensated
Employees and (b) are among the 25 nonexcludable employees and former employees
of the Controlled Group Members with the largest amount of compensation in the
current or any prior year and whose annual payments under the Plan must be
restricted due to the provisions of Section 401(a)(4) of the Internal Revenue
Code and regulations issued with respect thereto.
(2) To the extent required by Section 401(a)(4) of the Internal Revenue
Code and regulations issued with respect thereto, the annual benefit payable
under the Plan to any such Participant to whom the provisions of this Section
4.2(B) are applicable shall not exceed an amount equal to the payments that
would be made on his behalf under a single life annuity that is the actuarial
equivalent of the sum of his accrued benefit and his other benefits under the
Plan; provided, however, that such restriction shall not apply if:
(a) after payment of the "benefits" (as defined below) to the
Participants to whom the provisions of this Section 4.2(B) are
applicable, the remaining value of Plan assets equals or exceeds
110% of the value of current liabilities within the meaning of
Section 412(l)(7) of the Internal Revenue Code and regulations
issued with respect thereto;
(b) the value of the "benefits" (as defined below) for such
Participant is less than 1% of the value of current liabilities
within the meaning of Section 412(l)(7) of the Internal Revenue
Code and regulations issued with respect thereto;
(c) the value of the Participant's benefit does not exceed the
maximum amount that is permissible as an involuntary cash-out of
accrued benefits under Sections 411(a)(11) and 417(e) of the
Internal Revenue Code and regulations issued with respect
thereto;
(d) an agreement, which is expressly permitted under Section
401(a)(4) of the Internal Revenue Code or regulations or rulings
issued with respect thereto, is entered into with the Trustee,
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adequately secured in conformity with the requirements of said
Code section, regulations or rulings, which provides for the
repayment, if applicable and to the extent required under said
Code section, regulations or rulings, to the Trust Fund of any
part of the distribution which is restricted under the provisions
of said Code section, regulations or rulings;
or
(e) in the event of the termination of the Plan, there are sufficient
assets to satisfy all benefit liabilities of the Plan to
Participants and their Beneficiaries.
(3) For the purposes of this Section 4.2(B), the term "benefit" shall
have the meaning assigned in Treasury Regulation Section 1.401(a)(4)-5(b) and
shall include loans in excess of the amounts set forth in Section 72(p)(2)(A) of
the Internal Revenue Code, any periodic income, any withdrawal values payable to
a living employee, and any death benefits not provided for by insurance on the
employee's life.
4.3 - BENEFITS NONFORFEITABLE IF PLAN IS TERMINATED
In the event of the termination or partial termination of the Plan, the
rights of each affected Participant in the Plan to benefits accrued to such date
of termination, to the extent then funded, shall be nonforfeitable, where such
benefits shall be determined and distributed as provided in Section 4.5 hereof;
provided, however, if the participation in the Plan is terminated with respect
to one or more but not all Employers that are members of a group of Employers
with respect to which the Plan represents an IRC 414(l) Single Plan, the Plan
shall not be considered to have been terminated for the purposes of this Section
4.3 (although a partial termination of the Plan may result because of such
termination of participation). Unless specifically required otherwise by law or
by rules or regulations of the Internal Revenue Service, the nonforfeitable
rights granted to Participants under the provisions of this section shall not
apply with respect to (i) any benefits (or portions thereof) that have been
cashed out, whether voluntarily or involuntarily, under the provisions hereof
and that have not been reinstated (by repayment or by the reinstatement of
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Credited Service accrued prior to the date of such cash-out) in accordance with
the provisions hereof prior to the date of the termination or partial
termination of the Plan or (ii) any nonvested benefits that are deemed cashed
out and forfeited at the date of termination of service of a terminated or
retired Participant whose service was terminated prior to the date of
termination or partial termination of the Plan.
4.4 - MERGER OF PLAN
In the case of the merger or consolidation of the Plan with, or the
transfer of assets or liabilities to, another qualified retirement plan, each
Participant must be entitled to receive a benefit, upon termination of such
other retirement plan after such merger, consolidation or transfer, which is at
least equal to the benefit which he would have been entitled to receive
immediately before the merger, consolidation or transfer if the Plan had been
terminated at that time.
4.5 - TERMINATION OF PLAN AND DISTRIBUTION OF TRUST FUND
Upon termination of the Plan in accordance with the provisions hereof, the
share of the assets of the Trust Fund available for distribution to the affected
Participants and Beneficiaries shall be allocated and distributed in accordance
with the following procedure.
(A) The Committee shall determine the date of distribution and the share in
the value of the assets of the Trust Fund that is attributable to each Employer
or group of Employers with respect to which the Plan represents an IRC 414(l)
Single Plan.
(B) The distribution of the asset value will, subject to the provisions of
Section 417(e)(1) of the Internal Revenue Code, be provided by the purchase of
insured annuities from a company or companies selected by the Committee for each
class of Participants and other persons entitled to benefits under the Plan, as
specified in (C) below. Any annuities purchased pursuant to the provisions of
this Section 4.5 will be subject to the provisions hereof pertaining to the
4-24
Qualified Joint and 50% Survivor Annuity Option and to the Qualified
Preretirement Survivor Annuity.
(C) The Committee shall determine the asset value available for
distribution on behalf of each Employer or group of Employers with respect to
which the Plan represents an IRC 414(l) Single Plan after taking into account
the expenses of such distribution. After having determined such asset value
available for distribution to each such Employer or group of Employers, as the
case may be, and subject to the applicable provisions of any Supplement hereto
pertaining to the distribution of assets upon the termination of the Plan, the
Committee shall allocate such asset value (allocated to the particular Employer
or group of Employers) as of the date of termination of the Plan in the manner
set forth below to determine the amount, if any, to which each affected
Participant or Beneficiary is entitled. Such allocation shall be made using the
methods and actuarial assumptions that are being used as of the date of
termination of the Plan by the Pension Benefit Guaranty Corporation in
determining the value of plan benefits under terminating non-multiemployer
pension plans covered by Title IV of the Employee Retirement Income Security Act
of 1974, as amended, or, at the option of the Committee, using such other
methods and actuarial assumptions that are mutually acceptable to the Committee,
the Pension Benefit Guaranty Corporation and the Internal Revenue Service. In
cases where an annuity is purchased to provide any given retirement income, the
single premium payable for such annuity shall be deemed for the purposes of the
allocations described below to be the single-sum or present value of, or the
amount otherwise required to provide, the amount of retirement income
represented by such annuity.
(1) Allocation shall first be made with respect to each active,
retired or terminated Participant and to each Beneficiary of a
deceased Participant in an amount equal to the present value of
the portion, if any, of such individual's accrued benefit which
is derived from the Participant's employee contributions to the
Plan which were not mandatory employee contributions; provided,
however, that if the asset value is less than the aggregate of
such amounts, such amounts shall be reduced pro rata among such
individuals so that the aggregate of such reduced amounts will be
4-25
equal to the asset value; and provided further, however, that the
benefits on which the allocations specified below are based shall
exclude any portion thereof attributable to the Participant's
contributions to the Plan which were not mandatory.
(2) If there is any asset value remaining after the allocation under
(1) above, allocation shall next be made with respect to each
active, retired or terminated Participant and to each Beneficiary
of a deceased Participant in an amount equal to the present value
of the portion, if any, of such individual's accrued benefit
which is derived from the Participant's mandatory employee
contributions to the Plan; provided, however, that if such
remaining asset value is less than the aggregate of the amounts
thus allocated hereunder, such latter amounts shall be reduced
pro rata among such individuals so that the aggregate of such
reduced amounts will be equal to the remaining asset value.
(3) If there is any asset value remaining after the allocations under
(1) and (2) above, allocations shall next be made with respect
to:
(a) each retired or terminated Participant whose retirement
income payments commenced at least three years prior to the
date of termination of the Plan in an amount equal to the
excess, if any, of (i) the amount required to provide (after
the date of termination of the Plan) the smallest amount of
income payable to such Participant during such three-year
period immediately preceding the date of termination of the
Plan, based upon the provisions of the Plan as in effect
during the five-year period immediately preceding the date
of termination of the Plan that would result in the least
amount of income being payable to such Participant over (ii)
the amount of his allocation, if any, under (2) above;
(b) each person receiving a retirement income on such date of
termination on account of a deceased Participant or retired
or terminated (but since deceased) Participant whose
retirement income payments commenced, either to such person
or to such retired or terminated (but since deceased)
Participant, at least three years prior to the date of
termination of the Plan in an amount equal to the excess, if
any, of (i) the amount required to provide (after the date
of termination of the Plan) the smallest amount of income
payable to such person during such three-year period
immediately preceding the date of termination of the Plan,
based upon the provisions of the Plan as in effect during
the five-year period immediately preceding the date of
termination of the Plan that would result in the least
4-26
amount of income being payable to such person over (ii) the
amount of his allocation, if any, under (2) above; and
(c) each other active, retired or terminated Participant who, at
least three years prior to the date of termination of the
Plan either had become eligible for normal retirement but
had not yet retired or had satisfied the applicable age and
service requirements to be eligible for an early retirement
benefit, or the Beneficiary of any such eligible Participant
whose service was terminated by reason of his death during
such three-year period, in an amount equal to the excess, if
any, of (i) the amount required to provide (after the date
of termination of the Plan) the monthly retirement income
that would have been payable on behalf of such Participant
if he had retired three years prior to the date of
termination of the Plan, based upon the provisions of the
Plan as in effect during the five-year period immediately
preceding the date of termination of the Plan which would
result in the least amount of income being payable to such
Participant or Beneficiary over (ii) the amount of his
allocation, if any, under (2) above;
provided, however, that if such remaining asset value is less than the
aggregate of the amounts thus allocated hereunder, such latter amounts
shall be reduced pro rata among such individuals so that the aggregate
of such reduced amounts will be equal to the remaining asset value.
(4) If there is any asset value remaining after the allocations under (1),
(2) and (3) above, allocation shall next be made with respect to each
active, retired or terminated Participant and to each Beneficiary
under the Plan in an amount equal to the excess, if any, of (a) the
amount required to provide that portion of the single-sum value of the
Accrued Deferred Monthly Retirement Income Commencing at Normal
Retirement Date that he had accrued as of the date of termination of
the Plan or, if applicable, that he was receiving as of the date of
termination of the Plan, which is not in excess of the actuarially
equivalent single-sum value of the benefit guaranteed on his behalf
under the termination insurance provisions of the Employee Retirement
Income Security Act of 1974 determined without regard to Sections
4022(b)(5) and 4022(b)(6) of said Act, over (b) the aggregate of the
allocations, if any, made on his behalf under (2) and (3) above;
provided, however, that if such remaining asset value is less than the
aggregate of the amounts thus allocated hereunder, such latter amounts
shall be reduced pro rata among such individuals so that the aggregate
of such reduced amounts will be equal to the remaining asset value.
4-27
(5) If there is any asset value remaining after the allocations under (1),
(2), (3) and (4) above, allocation shall next be made with respect to
each retired or terminated Participant receiving a retirement income
hereunder on such date, each person receiving a retirement income on
such date on account of a deceased Participant or a retired or
terminated (but since deceased) Participant and each Participant who
has, by such date, become eligible for normal retirement but has not
yet retired, in an amount equal to the excess, if any, of (a) the
amount required to provide the retirement income that such Participant
or other person is receiving or is entitled to receive under the Plan
over (b) the aggregate of the allocations made on behalf of such
Participant or other person under (2), (3) and (4) above; provided,
however, that if such remaining asset value is less than the aggregate
of the amounts thus allocated hereunder, such latter amounts shall be
reduced pro rata among such individuals so that the aggregate of such
reduced amounts will be equal to the remaining asset value.
(6) If there is any asset value remaining after the allocations under (1),
(2), (3), (4) and (5) above, allocation shall next be made with
respect to:
(a) each Participant in the service of the Employer on the date of
termination of the Plan whose Initial Vesting Date is on or prior
to such date and who is not entitled to an allocation under (5)
above, in an amount equal to the excess, if any, of (i) the
amount required to provide the actuarially equivalent single-sum
value of the vested retirement income that he would have been
entitled to receive under the provisions of Section 2.4(A)(1)
hereof if his service had been terminated on the date of
termination of the Plan over (ii) the aggregate of the
allocations made on behalf of such Participant under (2), (3) and
(4) above;
(b) each disabled Participant then entitled to a benefit under the
provisions of Section 2.3 hereof, who has not, by such date,
reached his Disability Retirement Income Commencement Date, in an
amount equal to the excess, if any, of (i) the amount required to
provide the actuarially equivalent single-sum value of the vested
retirement income that he would have been entitled to receive
under the provisions of Section 2.1, 2.2 or 2.4(A)(1) hereof,
whichever would be applicable, if he had recovered from his total
and permanent disability, reentered the service of the Employer
on the date of termination of the Plan and his service had been
terminated immediately after his reentry over (ii) the aggregate
of the allocations made on behalf of such Participant under (2),
(3) and (4) above; and
4-28
(c) each terminated Participant then entitled to a benefit under the
provisions of Section 2.4(A)(1) hereof, whose monthly income
payments have not commenced by such date, in an amount equal to
the excess, if any, of (i) the amount required to provide the
actuarially equivalent single-sum value of the vested deferred
retirement income to which he is entitled under Section 2.4(A)(1)
hereof over (ii) the aggregate of the allocations made on behalf
of such Participant under (2), (3) and (4) above;
provided, however, that if such remaining asset value is less than the
aggregate of the amounts thus allocated hereunder, such latter amounts
shall be reduced pro rata among such individuals so that the aggregate
of such reduced amounts will be equal to the remaining asset value.
(7) If there is any asset value remaining after the allocations under (1),
(2), (3), (4), (5) and (6) above, allocation shall lastly be made with
respect to each Participant in the service of the Employer on the date
of termination of the Plan who is not entitled to an allocation under
(5) above, in an amount equal to the excess, if any, of (a) the amount
required to provide the actuarially equivalent single-sum value of the
Accrued Deferred Monthly Retirement Income Commencing at Normal
Retirement Date that he had accrued as of the date of termination of
the Plan (assuming his Vested Percentage is 100%) over (b) the
aggregate of the allocations made on behalf of such Participant under
(2), (3), (4) and (6) above; provided, however, that if such remaining
asset value is less than the aggregate of the amounts thus allocated
hereunder, such latter amounts shall be reduced pro rata among such
individuals so that the aggregate of such reduced amounts will be
equal to such remaining asset value.
(8) In the event that there is asset value remaining after the full
allocations specified in (1), (2), (3), (4), (5), (6) and (7) above,
such residual assets shall be distributed to the Employer, except
that, in the case of a group of Employers with respect to which the
Plan represents an IRC 414(l) Single Plan, such residual assets shall
remain in the Trust Fund if the Plan is not being terminated with
respect to all of such Employers.
(D) The order of priorities for, and the amounts and methods of, the
distributions set forth in (C) above and the rights of Participants and their
Beneficiaries to benefits under the Plan shall be subject (i) to the
distribution rules set forth in the Plan, (ii) to the limitations provided by
Section 4.2 of the Plan, (iii) to any changes, including the recapture of any
4-29
prior distributions to Participants, as may be ordered by the Pension Benefit
Guaranty Corporation and (iv) to any changes required by the Internal Revenue
Service as a condition for issuing a favorable determination letter stating that
the distribution of assets will not adversely affect the continued qualified
status of the Plan under Section 401(a) of the Internal Revenue Code.
(E) As soon as practicable after both (a) the date that the assets may be
distributed under the rules and regulations of the Pension Benefit Guaranty
Corporation and (b) the date that a favorable determination letter is received
from the Internal Revenue Service stating that in its opinion the method of
distribution will not adversely affect the continued qualified status of the
Plan under Section 401(a) of the Internal Revenue Code, the Committee shall
direct the Trustee to distribute the assets to the affected parties in
accordance with such method.
4.6 - SPECIAL PROVISIONS THAT APPLY IF PLAN IS TOP-HEAVY
The provisions of this Section 4.6 shall apply if the Plan is a "top-heavy
plan" within the meaning of Section 416(g) of the Internal Revenue Code with
respect to any Plan Year beginning after December 31, 1983. Unless a different
meaning is plainly required by the context, the term "Plan" as used in this
Section 4.6 shall include the Retirement Plan for Employees of Capital Southwest
Corporation and Its Affiliates as in effect during the Plan Years beginning
after December 31, 1983 and before the Effective Date of the Plan.
(A) Determination of Plan Years in Which Plan Is Top-Heavy: The Plan shall
be top-heavy with respect to an applicable Plan Year if:
(1) either:
(a) any Participant, former Participant or Beneficiary in the
Plan is a "key employee" within the meanings of Sections
416(i)(1) and 416(i)(5) of the Internal Revenue Code
(hereinafter referred to in this Section 4.6 as
"Key-Employees"); or
(b) the Plan is required to be combined with any other plan,
which is included in the Aggregation Group (as defined
below) and which has a participant who is a Key Employee, in
order to enable such other plan to meet the requirements of
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Section 401(a)(4) or Section 410 of the Internal Revenue
Code;
and
(2) the ratio (determined in accordance with Section 416 of the
Internal Revenue Code) as of the last day of the preceding Plan
Year or, in the case of the first Plan Year, the last day of such
first Plan Year (such day, whether applicable to the first Plan
Year or to subsequent Plan Years, is hereinafter referred to in
this Section 4.6 as the "Determination Date") of:
(a) the sum of (i) the present value of the cumulative accrued
benefits for all Key Employees under all defined benefit
plans included in the Aggregation Group plus (ii) the
aggregate of the individual accounts of all Key Employees
under all defined contribution plans included in such
Aggregation Group;
to
(b) a similar sum determined for all Participants, former
Participants and Beneficiaries under all defined benefit
plans and defined contribution plans included in such
Aggregation Group, but excluding any such Participant or
former Participant (or his Beneficiary) who was a Key
Employee for any prior Plan Year but who is not currently a
Key Employee and also excluding, for Plan Years beginning
after December 31, 1984, any Participant or former
Participant (or his Beneficiary) who has not at any time
during the one-year period ending on the Determination Date,
or during the five-year period ending on the Determination
Date with respect to Plan Years beginning prior to January
1, 2002, performed services for any employer maintaining a
plan included in the Aggregation Group;
is greater than 60%.
For the purposes of this Section 4.6, the Aggregation Group shall mean the
Plan plus all other defined benefit plans and defined contribution plans
(including any such plans that terminated during the five-year period ending on
the Determination Date), if any, maintained by the Controlled Group Members;
provided, however, that any defined benefit plan or defined contribution plan of
any Controlled Group Member that (i) does not have any participant who is a Key
Employee and (ii) is not required to be combined with any other plan, which is
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included in the Aggregation Group and which has a participant who is a Key
Employee, in order to enable such other plan to meet the requirements of Section
401(a)(4) or Section 410 of the Internal Revenue Code, shall be included in the
Aggregation Group only if such defined benefit plan or defined contribution
plan, together with the other plans that are included in the Aggregation Group,
as a combined group satisfy the requirements of Sections 401(a)(4) and 410 of
the Internal Revenue Code. In determining Key Employees under the Plan, the
compensation taken into account shall be "IRC 415 Compensation" as defined above
in Section 4.1(A).
The present value of an accrued benefit under the Plan shall, for the
purposes of this Section 4.6, be determined as of the most recent valuation date
that (i) is used for the Plan Year for computing Plan costs for minimum funding
purposes (regardless of whether a valuation is actually performed for that year)
and (ii) is within the 12-month period ending on the applicable Determination
Date (such valuation date is herein referred to in this Section 4.6 as the
"Valuation Date"). The present value of accrued benefits under the Plan and
under each other defined benefit plan included in the aggregation group shall be
computed using 5% interest and the mortality table used for such Plan Year for
computing Plan costs for minimum funding purposes.
The present value of the cumulative accrued benefits under the other
defined benefit plans included in the Aggregation Group and the aggregate of the
individual accounts under the defined contribution plans included in such
Aggregation Group shall be determined separately for each such plan in
accordance with Section 416 of the Internal Revenue Code and regulations issued
with respect thereto as of the "determination date" that is applicable to each
such separate plan and that falls within the same calendar year that the
Determination Date applicable to the Plan falls.
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Unless required otherwise under Section 416 of the Internal Revenue Code
and regulations issued thereunder, a Participant's (or Beneficiary's) accrued
benefit under the Plan shall be equal to the sum of:
(a) an amount equal to either:
(i) if his service has not been terminated and he has not
reached his Normal Retirement Date as of the Valuation Date,
the Accrued Deferred Monthly Retirement Income Commencing at
Normal Retirement Date that he has accrued as of the
Valuation Date;
(ii) if his service has not been terminated and he has reached
his Normal Retirement Date as of the Valuation Date, the
monthly retirement income to which he would have been
entitled under the normal retirement provisions of the Plan
if he had retired on the Valuation Date;
or
(iii) if his service has been terminated as of the Valuation
Date, the amount of retirement income or other benefit that
is payable on his behalf under the Plan on and after the
Valuation Date;
plus
(b) the aggregate distributions made on his behalf during the
one-year period ending on the Determination Date (five-year
period ending on the Determination Date, with respect to any
distribution made for any reason other than death, disability, or
separation from service);
provided, however, that his estimated accrued benefit between the Valuation Date
and Determination Date applicable to the first Plan Year shall be included as
part of his accrued benefit with respect to the first Plan Year only. Any
provisions hereof to the contrary notwithstanding and solely for the purpose of
determining if the Plan is top-heavy with respect to an applicable Plan Year
beginning after December 31, 1986, the accrued benefit of any employee who is
not a Key Employee shall be determined under the method which is used for
accrual purposes for all defined benefit plans included in the Aggregation Group
or, if a single method is not used for all such defined benefit plans, the
accrued benefit of such employee shall be determined as though it accrued not
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more rapidly than the slowest accrual rate permitted under the fractional
accrual rule of Section 411(b)(1)(C) of the Internal Revenue Code.
(B) Minimum Vesting Provisions if Plan Becomes Top-Heavy: Any other
provision of the Plan to the contrary notwithstanding, the Initial Vesting Date
of a Participant in the Plan, who has accrued an Hour of Service during any Plan
Year that is subsequent to the last Plan Year that the Plan was not top-heavy,
for the purpose of determining his eligibility for the benefit provided under
Section 2.4(A) hereof during any Plan Year that is subsequent to the last Plan
Year that the Plan was not top-heavy, shall not be later than (i) the date as of
which he completes two years of Vesting Service or (ii) the first day of the
Plan Year immediately following the last Plan Year that the Plan was not
top-heavy, whichever is later, but the Vested Percentage of the Participant for
the purposes of Section 2.4(A)(1) shall be 100% with respect to the portion of
his Accrued Deferred Monthly Retirement Income Commencing at Normal Retirement
Date that is attributable to his own contributions, if any, and shall not be
less than the percentage specified in the schedule below, based upon the
Participant's number of years (ignoring fractions) of Vesting Service as of the
date of termination of his service, with respect to the portion of his Accrued
Deferred Monthly Retirement Income Commencing at Normal Retirement Date that is
attributable to employer contributions:
Years of Vested
Vesting Service Percentage
--------------- ----------
Less than 2 0%
2 20%
3 40%
4 60%
5 or more 100%
In the event that the Plan ceases to be top-heavy with respect to any subsequent
Plan Year, the following provisions will apply with respect to the minimum
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benefits to which such a Participant is entitled under Section 2.4(A) hereof
during such subsequent Plan Years that the Plan is not top-heavy:
(1) if the Participant had not completed at least two years of
Vesting Service as of the last day of the last Plan Year during
which the Plan was top-heavy, his nonforfeitable right to the
benefits to which he is entitled under Section 2.4(A) hereof
shall be determined as though the Plan had never been top-heavy;
(2) if the Participant had completed at least two but had not
completed at least three years of Vesting Service as of the last
day of the last Plan Year during which the Plan was top-heavy, he
shall be eligible for a minimum benefit payable under Section
2.4(A) hereof; such minimum benefit provided under Section
2.4(A)(1) shall be based upon (a) 100% of the portion of his
Accrued Deferred Monthly Retirement Income Commencing at Normal
Retirement Date that he has accrued as of the date of termination
of his service that is attributable to his own contributions, if
any, plus (b) the product of (i) the portion of the Accrued
Deferred Monthly Retirement Income Commencing at Normal
Retirement Date that he had accrued as of the date of termination
of his service that is attributable to employer contributions
multiplied by (ii) his Vested Percentage determined as of the
last day of the last Plan Year during which the Plan was
top-heavy;
(3) if the Participant had completed at least three years of Vesting
Service as of the last day of the last Plan Year during which the
Plan was top-heavy, he shall be eligible for the benefit provided
under Section 2.4(A) hereof, but the Participant's Vested
Percentage shall be determined in the same manner as though the
Plan had remained top-heavy; and
(4) the Accrued Deferred Monthly Retirement Income Commencing at
Normal Retirement Date that a Participant, whose Vesting Service
includes service that was accrued on or prior to the last day of
the last Plan Year that the Plan was top-heavy, has accrued as of
any given date shall not be less than the actuarial equivalent of
(a) the benefit provided on his behalf under Section 4.6(C)(1)
below as of such given date plus (b) the benefit provided on his
behalf under Section 4.6(C)(2)(a) below as of the last day of the
last Plan Year during which the Plan was top-heavy less (c) the
amount of the benefit provided on his behalf under Section
4.6(C)(2)(b) below as of such given date.
(C) Minimum Benefit If Plan Becomes Top-Heavy: In the event that the
service of a Participant, who is not a Key Employee, is terminated on or after
his Initial Vesting Date for any reason, the retirement income payable to the
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Participant under the provisions of Section 2.1, 2.2, 2.3 or 2.4(A) hereof or,
if the service of the Participant is terminated by reason of his death, the
retirement income which he has accrued as of the date of his death that is used
to determine the benefit payable on his behalf under the provisions of Section
2.4(B) hereof, whichever is applicable, shall not be less than that amount of
retirement income which is actuarially equivalent (based upon the interest and
mortality assumptions that are being used under the Plan as of the date of his
retirement or termination of service to determine actuarially equivalent
non-decreasing annuities) to an amount equal to:
(1) 100% of the portion of his Accrued Deferred Monthly Retirement
Income Commencing at Normal Retirement Date that he has accrued
as of the date of his retirement or termination of service that
is attributable to his own contributions, if any;
plus
(2) the excess, if any, of:
(a) a monthly retirement income payable to the Participant for
life (with no ancillary benefits) commencing at his Normal
Retirement Date in an amount equal to (i) 2% of his "IRC 416
Final Average Monthly Compensation" multiplied by (ii) his
number of years of Vesting Service, not in excess of 10
years, that were accrued during those Plan Years in which
the Plan was top-heavy, with the resulting product of (i)
and (ii) multiplied by (iii) his Vested Percentage at the
date of his retirement or termination of service; provided,
however, if the Participant retires after his Normal
Retirement Date, the amount of the monthly retirement income
determined under this Subparagraph (a) shall not be less
than the actuarial equivalent of the monthly retirement
income determined in accordance with this subparagraph that
would have been payable to the Participant if he had retired
on his Normal Retirement Date;
over
(b) the monthly retirement income payable to the Participant for
life (with no ancillary benefits) commencing at his Normal
Retirement Date in an amount equal to the sum of:
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(i) such amount of income, if any, that he has a
nonforfeitable right to receive and that is
attributable to employer contributions and is payable
to the Participant under the other defined benefit
plans, if any, which are included in the Aggregation
Group;
plus
(ii) such amount of income that can be provided on an
actuarially equivalent basis (based upon the interest
and mortality assumptions that are being used under the
Plan as of the date of his retirement or termination of
service to determine actuarially equivalent
non-decreasing annuities) by the amounts, if any, that
he has a nonforfeitable right to receive and that are
attributable to employer contributions and forfeitures
that are credited to his account under the defined
contribution plans, if any, included in the Aggregation
Group;
provided, however, if the Aggregation Group includes one or more defined
contribution plans and if, with respect to each Plan Year that the Plan is
top-heavy, the Participant has received an allocation of employer contributions
and forfeitures to his account under such defined contribution plan or plans
which is equal to or greater than 5% of the IRC 415 Compensation that he
received during such Plan Year from the employers maintaining plans included in
the Aggregation Group, the minimum benefit described above in this Section
4.6(C) shall not apply to such Participant. For purposes of Section 4.6(C)(2)(a)
above, a Participant's service with a Controlled Group Member which occurs
during a Plan Year in which the Plan does not benefit (within the meaning of
Section 410(b) of the Internal Revenue Code) any Key Employee or former Key
Employee shall be ignored or excluded in determining such Participant's Vesting
Service.
For the purposes of this Section 4.6(C), subject to the limitations of
Section 401(a)(17) of the Internal Revenue Code, a Participant's "IRC 416 Final
Average Monthly Compensation" shall be equal to his average monthly rate of IRC
415 Compensation for the five consecutive calendar years, which are prior to the
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January 1st immediately following (i) the date of the Participant's retirement
or termination of service or (ii) the close of the last Plan Year in which the
Plan is top-heavy, whichever is earlier, during which he received the highest
aggregate IRC 415 Compensation. Such average monthly rate will be determined by
dividing the total of such IRC 415 Compensation that he received during such
five-consecutive-calendar year period from the employers maintaining plans
included in the Aggregation Group by the product equal to 12 times the number of
years of Vesting Service which he accrued during such five-calendar-year period.
In the event that the Participant does not receive both IRC 415 Compensation and
Vesting Service during a calendar year or calendar years, such calendar year or
calendar years during which he did not receive both IRC 415 Compensation and
Vesting Service shall be ignored and excluded in determining the five
consecutive calendar years during which he received the highest aggregate IRC
415 Compensation.
4.7 TRANSFERS
Notwithstanding any provision in this Plan to the contrary, assets held by
the Trust may be transferred between the Trust and any other trust which is
exempt from tax under Section 501(a) of the Internal Revenue Code and which is
used in connection with a plan that complies with the qualification requirements
of Section 401(a) of the Internal Revenue Code, provided that proper notice is
given to the Internal Revenue Service as may be required. The Committee shall
determine whether to allow any such transfer and shall inform the Trustee of the
determination made by the Committee regarding any such transfer and direct the
Trustee accordingly. If any assets are transferred from the Trust on behalf of
Participants pursuant to a direction described in this section, the assets
transferred shall be determined based upon the requirements of Section 414(l) of
the Internal Revenue Code and the accrued benefits of those Participants under
the Plan shall be reduced to zero. In the event of a transfer received by the
Trust, the Committee shall take all necessary steps to ensure that any optional
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form of benefit applicable to the assets subject to such a transfer remain
applicable to the transferred assets after the transfer pursuant to the
requirements of Section 411(d)(6) of the Internal Revenue Code and Section
1.411(d)-4 of the Treasury Regulations. Any transfer made pursuant to the
provisions of this section shall be made in a manner consistent with the
requirements of Sections 401(a)(12) and 414(l) of the Internal Revenue Code,
Section 208 of the Employee Retirement Income Security Act of 1974, as amended,
and the regulations thereunder. Any transfer of assets or liabilities will, for
purposes of Section 414(l) of the Internal Revenue Code, be considered as a
combination of separate mergers and spinoffs using the rules of Section
1.414(l)-1 of the Treasury Regulations.
4.8 - MINIMUM DISTRIBUTION REQUIREMENTS
(A) General Rules:
(1) Effective Date: The provisions of this Section 4.8 will apply for
purposes of determining required minimum distributions for calendar years
beginning with the 2006 calendar year.
(2) Precedence: The requirements of this Section 4.8 will take precedence
over any inconsistent provisions of the Plan.
(3) Requirements of Treasury Regulations Incorporated: All distributions
required under this Section 4.8 will be determined and made in accordance with
Sections 1.401(a)(9)-1 through 1.401(a)(9)-9 of the Treasury regulations under
Section 401(a)(9) of the Internal Revenue Code.
(4) TEFRA Section 242(b)(2) Elections: Notwithstanding the other provisions
of this Section 4.8, other than Section 4.8(A)(3) above, distributions may be
made under a designation made before January 1, 1984, in accordance with Section
242(b)(2) of the Tax Equity and Fiscal Responsibility Act (TEFRA) and the
provisions of the Plan that relate to Section 242(b)(2) of TEFRA.
(B) Time and Manner of Distribution:
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(1) Required Beginning Date: The Participant's entire interest will be
distributed, or begin to be distributed, to the Participant no later than the
Participant's Required Beginning Date.
(2) Death of Participant Before Distributions Begin: If the Participant
dies before distributions begin, the Participant's entire interest will be
distributed, or begin to be distributed, no later than as follows:
(a) If the Participant's surviving spouse is the Participant's sole
designated Beneficiary, then distributions to the surviving spouse will
begin by December 31 of the calendar year immediately following the
calendar year in which the Participant died, or by December 31 of the
calendar year in which the Participant would have attained age 70 1/2, if
later.
(b) If the Participant's surviving spouse is not the Participant's
sole designated Beneficiary as of September 30 of the year following the
year of the Participant's death, then distributions to the designated
Beneficiary will begin by December 31 of the calendar year immediately
following the calendar year in which the Participant died.
(c) If there is no designated Beneficiary as of September 30 of the
year following the year of the Participant's death, the Participant's
entire interest will be distributed by December 31 of the calendar year
containing the fifth anniversary of the Participant's death.
(d) If the Participant's surviving spouse is the Participant's sole
designated Beneficiary as of September 30 of the year following the year of
the Participant's death, and the surviving spouse dies after the
Participant but before distributions to the surviving spouse begin, this
Section 4.8(B)(2), other than Section 4.8(B)(2)(a), will apply as if the
surviving spouse were the Participant.
For purposes of this Section 4.8(B)(2) and Section 4.8(E), distributions are
considered to begin on the Participant's Required Beginning Date (or, if Section
4.8(B)(2)(d) applies, the date distributions are required to begin to the
surviving spouse under Section 4.8(B)(2)(a)). If annuity payments irrevocably
commence to the Participant before the Participant's Required Beginning Date (or
to the Participant's surviving spouse before the date distributions are required
to begin to the surviving spouse under Section 4.8(B)(2)(a)), the date
distributions are considered to begin is the date distributions actually
commence. Any amount payable to the surviving child of the Participant in
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accordance with the requirements of Q&A-15 of Section 1.401(a)(9)-6 of the
Treasury regulations shall be treated for purposes of this Section 4.8 as if it
had been paid to such Participant's surviving spouse to the extent such amount
that is payable to the child will become payable to the Participant's surviving
spouse upon such child reaching majority (or upon the occurrence of such other
event specified in Q&A-15 of Section 1.401(a)(9)-6 of the Treasury regulations
or otherwise specified in IRS guidance under Section 401(a)(9) of the Internal
Revenue Code.)
(3) Form of Distribution: Unless the Participant's interest is distributed
in the form of an annuity purchased from an insurance company or in a single sum
on or before the Required Beginning Date, as of the first distribution calendar
year distributions will be made in accordance with Sections 4.8(C), (D), and (E)
hereof. If the Participant's interest is distributed in the form of an annuity
purchased from an insurance company, distributions thereunder will be made in
accordance with the requirements of Section 401(a)(9) of the Internal Revenue
Code and the Treasury regulations. Any part of the Participant's interest which
is in the form of an individual account described in Section 414(k) of the
Internal Revenue Code will be distributed in a manner satisfying the
requirements of Section 401(a)(9) of the Internal Revenue Code and the Treasury
regulations that apply to individual accounts.
(4) Change in Annuity Payment Period: Once payments have commenced over a
period, the period may only be changed in accordance with Q&A-13 of Section
1.401(a)(9)-6 of the Treasury regulations under the following circumstances, or
as may be expressly permitted in other IRS guidance under Section 401(a)(9) of
the Internal Revenue Code, if permitted under applicable provisions of the Plan:
(a) at the time the Participant retires or in connection with
termination of the Plan;
(b) where distribution prior to the change is being made in the form
of a period-certain-only annuity without life contingencies; or
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(c) where the annuity payments after the change are paid under a
Qualified Joint and Survivor Annuity over the joint lives of the
Participant and a designated beneficiary, the Participant's spouse is the
sole designated beneficiary, and the change occurs in connection with the
Participant becoming married to such spouse.
(C) Determination of Amount to be Distributed Each Year:
(1) General Annuity Requirements: If the Participant's interest is paid in
the form of annuity distributions under the Plan, payments under the annuity
will satisfy the following requirements:
(a) the annuity distributions will be paid in periodic payments made
at intervals not longer than one year;
(b) the distribution period will be over a life (or lives) or over a
period certain not longer than the period described in Section 4.8(D) or
(E) below;
(c) once payments have begun over a period certain, the period certain
will not be changed even if the period certain is shorter than the maximum
permitted; and
(d) payments will either be nonincreasing or increase only as follows:
(i) by an annual percentage increase that does not exceed
the annual percentage increase in an eligible cost-of-living
index, as defined in Q&A-14(b) of Section 1.401(a)(9)-6 of the
Treasury regulations, for a 12-month period ending in the year
during which the increase occurs or the prior year, that is based
on prices of all items and issued by the Bureau of Labor
Statistics;
(ii) by a percentage increase that occurs at specified
times, such as at specified ages, and does not exceed the
cumulative total of annual percentage increases in an eligible
cost-of-living index as defined in clause (i) above since the
annuity starting date or, if later, the date of the most recent
percentage increase, provided that in cases providing such a
cumulative increase an actuarial increase may not be provided to
reflect the fact that increases were not provided in the interim
years;
(iii) to the extent of the reduction in the amount of the
Participant's payments to provide for a survivor benefit upon
death, but only if the Beneficiary whose life was being used to
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determine the distribution period described in Section 4.8(D)
dies or is no longer the Participant's Beneficiary pursuant to a
qualified domestic relations order within the meaning of Section
414(p) of the Internal Revenue Code;
(iv) to pay increased benefits that result from a Plan
amendment;
(v) to allow a beneficiary to convert the survivor portion
of a joint and survivor annuity into a single-sum distribution
upon the employee's death; or
(vi) to the extent increases are permitted in accordance
with paragraph (c) or (d) of Q&A-14 of Section 1.401(a)(9)-6 of
the Treasury regulations.
(2) Amount Required to be Distributed by Required Beginning Date: The
amount that must be distributed on or before the Participant's Required
Beginning Date (or, if the Participant dies before distributions begin, the date
distributions are required to begin under Section 4.8(B)(2)(a) or (b)) is the
payment that is required for one payment interval. The second payment need not
be made until the end of the next payment interval even if that payment interval
ends in the next calendar year. Payment intervals are the periods for which
payments are received, e.g., bi-monthly, monthly, semi-annually, or annually.
All of the Participant's benefit accruals as of the last day of the first
distribution calendar year will be included in the calculation of the amount of
the annuity payments for payment intervals ending on or after the Participant's
Required Beginning Date.
(3) Additional Accruals After First Distribution Calendar Year: Any
additional benefits accruing to the Participant in a calendar year after the
first distribution calendar year will be distributed beginning with the first
payment interval ending in the calendar year immediately following the calendar
year in which such amount accrues.
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(D) Requirements for Annuity Distributions That Commence During
Participant's Lifetime:
(1) Joint Life Annuities Where the Beneficiary Is Not the Participant's
Spouse: If the Participant's interest is being distributed in the form of a
joint and survivor annuity for the joint lives of the Participant and a
nonspouse Beneficiary, annuity payments to be made on or after the Participant's
Required Beginning Date to the designated Beneficiary after the Participant's
death shall not at any time exceed the applicable percentage of the annuity
payment for such period that would have been payable to the Participant using
the table set forth in Q&A-2 of Section 1.401(a)(9)-6 of the Treasury
regulations. If the form of distribution combines a joint and survivor annuity
for the joint lives of the Participant and a nonspouse Beneficiary and a period
certain annuity, the requirement in the preceding sentence will apply to annuity
payments to be made to the designated Beneficiary after the expiration of the
period certain.
(2) Period Certain Annuities: Unless the Participant's spouse is the sole
designated Beneficiary and the form of distribution is a period certain and no
life annuity, the period certain for an annuity distribution commencing during
the Participant's lifetime shall not exceed the applicable distribution period
for the Participant under the Uniform Lifetime Table set forth in Section
1.401(a)(9)-9 of the Treasury regulations for the calendar year that contains
the Annuity Starting Date. If the Annuity Starting Date precedes the year in
which the Participant reaches age 70, the applicable distribution period for the
Participant is the distribution period for age 70 under the Uniform Lifetime
Table set forth in Section 1.401(a)(9)-9 of the Treasury regulations plus the
excess of 70 over the age of the Participant as of the Participant's birthday in
the year that contains the Annuity Starting Date. If the Participant's spouse is
the Participant's sole designated Beneficiary and the form of distribution is a
period certain and no life annuity, the period certain may not exceed the longer
of the Participant's applicable distribution period, as determined under this
Section 4.8(D)(2), or the joint life and last survivor expectancy of the
Participant and the Participant's spouse as determined under the Joint and Last
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Survivor Table set forth in Section 1.401(a)(9)-9 of the Treasury regulations,
using the Participant's and spouse's attained ages as of the Participant's and
spouse's birthdays in the calendar year that contains the Annuity Starting Date.
(E) Requirements for Minimum Distributions Where Participant Dies
Before Date Distributions Begin:
(1) Participant Survived by Designated Beneficiary: If the Participant dies
before the date distribution of his or her interest begins and there is a
designated Beneficiary, the Participant's entire interest will be distributed,
beginning no later than the time described in Section 4.8(B)(2), over the life
of the designated Beneficiary or over a period certain not exceeding:
(a) unless the Annuity Starting Date is before the first
distribution calendar year, the life expectancy of the designated
Beneficiary determined using the Beneficiary's age as of the
Beneficiary's birthday in the calendar year immediately following the
calendar year of the Participant's death; or
(b) if the Annuity Starting Date is before the first distribution
calendar year, the life expectancy of the designated Beneficiary
determined using the Beneficiary's age as of the Beneficiary's
birthday in the calendar year that contains the Annuity Starting Date.
(2) No Designated Beneficiary: If the Participant dies before the date
distributions begin and there is no designated Beneficiary as of September 30 of
the year following the year of the Participant's death, distribution of the
Participant's entire interest will be completed by December 31 of the calendar
year containing the fifth anniversary of the Participant's death.
(3) Death of Surviving Spouse Before Distributions to Surviving Spouse
Begin: If the Participant dies before the date distribution of his or her
interest begins, the Participant's surviving spouse is the Participant's sole
designated Beneficiary, and the surviving spouse dies before distributions to
the surviving spouse begin, this Section 4.8(E) will apply as if the surviving
spouse were the Participant, except that the time by which distributions must
begin will be determined without regard to Section 4.8(B)(2)(a).
(F) Definitions:
(1) Designated Beneficiary: The individual who is designated as the
Beneficiary under Section 5.2 or 5.3 of the Plan and is the designated
beneficiary under Section 401(a)(9) of the Internal Revenue Code and Section
1.401(a)(9)-4, Q&A-1, of the Treasury regulations.
(2) Distribution calendar year: A calendar year for which a minimum
distribution is required. For distributions beginning before the Participant's
death, the first distribution calendar year is the calendar year immediately
preceding the calendar year which contains the Participant's Required Beginning
Date. For distributions beginning after the Participant's death, the first
distribution calendar year is the calendar year in which distributions are
required to begin pursuant to Section 4.8(B)(2).
(3) Life expectancy: Life expectancy as computed by use of the Single Life
Table in Section 1.401(a)(9)-9 of the Treasury regulations.
(4) Required Beginning Date: The date specified in Section 1.1(A) of the
Plan.
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SECTION 5
MISCELLANEOUS PROVISIONS REGARDING PARTICIPANTS
5.1 - PARTICIPANTS TO FURNISH REQUIRED INFORMATION
Each Participant, his spouse and his Beneficiaries and joint pensioners
will furnish to the Committee such information as the Committee considers
necessary or desirable for purposes of administering the Plan, and the
provisions of the Plan respecting any payments thereunder are conditional upon
the Participant's, Beneficiary's or joint pensioner's furnishing promptly such
true, full and complete information as the Committee may request.
Each Participant will submit proof of his age and marital status and proof
of the age and continued life of each Beneficiary and joint pensioner designated
or selected by him to the Committee at such time as required by the Committee.
The Committee will, if such proof of age, marital status or continued life is
not submitted as required, use as conclusive evidence thereof, such information
as is deemed by it to be reliable, regardless of the source of such information.
Any adjustment required by reason of lack of proof or the misstatement of the
age of persons entitled to benefits hereunder, by the Participant or otherwise,
will be in such manner as the Committee deems equitable.
Any notice or information which, according to the terms of the Plan or the
rules of the Committee, must be filed with the Committee, shall be deemed so
filed at the time that it is actually received by the Committee.
The Employer, the Committee, and any person or persons involved in the
administration of the Plan shall be entitled to rely upon any certification,
statement, or representation made or evidence furnished by an employee,
Participant, Beneficiary or joint pensioner with respect to his age or other
facts required to be determined under any of the provisions of the Plan and
shall not be liable on account of the payment of any monies or the doing of any
act or failure to act in reliance thereon. Any such certification, statement,
representation or evidence, upon being duly made or furnished, shall be
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conclusively binding upon the person furnishing same; but it shall not be
binding upon the Employer, the Committee, or any other person or persons
involved in the administration of the Plan, and nothing herein contained shall
be construed to prevent any of such parties from contesting any such
certification, statement, representation or evidence or to relieve the Employee,
Participant, Beneficiary or joint pensioner from the duty of submitting
satisfactory proof of any such fact.
Any Participant, Beneficiary, joint pensioner or other person who receives
an incorrect payment from the Trust Fund (whether an erroneous benefit amount, a
payment made after a Participant's death or other reason) shall be responsible
to notify the Committee or the Trustee of such receipt of incorrect payment and
to promptly return such payment to the Trustee.
5.2 - BENEFICIARIES
Subject to the provisions of the following paragraphs of this section, each
Participant may, on a form provided for that purpose, signed and filed with the
Committee, designate a Beneficiary to receive the benefit, if any, which may be
payable to his Beneficiary under the Plan in the event of his death, and each
designation may be revoked by such Participant by signing and filing with the
Committee a new designation of Beneficiary form.
If a deceased Participant, who has been married to his spouse throughout
the one-year period immediately preceding his death, has designated a person
other than his spouse as his Beneficiary and such spouse has not validly
consented in accordance with the provisions of Sections 4.1(D) and 4.1(E) hereof
to such other person being designated as the Beneficiary, the provisions of
Section 4.1(D) hereof, relating to the Qualified Preretirement Survivor Annuity
payable to his surviving spouse, will apply in the event of his death on or
after his Initial Vesting Date, and the Participant will automatically be deemed
5-3
to have changed his designation of Beneficiary to the extent necessary to comply
with the provisions of Section 4.1(D).
If a deceased Participant who had a spouse at the date of his death failed
to designate a Beneficiary in accordance with the provisions of this section, he
shall be deemed to have designated his spouse as his Beneficiary. If a deceased
Participant who had no spouse at the date of his death failed to designate a
Beneficiary in accordance with the provisions of this section, or if such a
deceased Participant had previously designated a Beneficiary but no designated
Beneficiary is surviving at the date of his death, the death benefit, if any,
that may be payable under the Plan with respect to such deceased Participant
shall be paid to the estate of such deceased Participant. In any of such cases,
if the commuted value of the remaining monthly income payments is equal to or
less than the maximum amount that is permissible as an involuntary cash-out of
accrued benefits under Sections 411(a)(11) and 417(e) of the Internal Revenue
Code and regulations issued with respect thereto, the commuted value of the
remaining payments shall, subject to the provisions of Section 3.2 hereof, be
paid in a lump sum. Any payment made to any person pursuant to the provisions of
this Section 5.2 shall operate as a complete discharge of all obligations under
the Plan with respect to such deceased Participant and shall not be subject to
review by anyone but shall be final, binding and conclusive on all persons ever
interested hereunder.
5.3 - CONTINGENT BENEFICIARIES
In the event of the death of a Beneficiary who survives the Participant and
who, at the Beneficiary's death, is receiving benefits pursuant to the
provisions of the Plan within any certain period specified under the Plan with
respect to which death benefits are payable under the Plan after the
Participant's death, the same amount of monthly retirement income that the
Beneficiary was receiving shall be payable for the remainder of such specified
certain period to a person designated by the Participant (in the manner provided
in Section 5.2) to receive the remaining death benefits, if any, payable in the
event of such contingency or, if no person was so named, then to a person
designated by the Beneficiary (in the manner provided in Section 5.2) of the
deceased Participant to receive the remaining death benefits, if any, payable in
the event of such contingency; provided, however, that if no person so
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designated is living upon the occurrence of such contingency, or if there has
been no such designation, then the remaining death benefits, if any, shall be
payable for the remainder of such specified certain period to the estate of such
deceased Beneficiary, or the Committee may elect to have a court of applicable
jurisdiction determine to whom a payment or payments shall be paid. In any of
such cases, if the commuted value of the monthly income payments due for the
remainder of the specified certain period is equal to or less than the maximum
amount that is permissible as an involuntary cash-out of accrued benefits under
Sections 411(a)(11) and 417(e) of the Internal Revenue Code and regulations
issued with respect thereto, the commuted value of the remaining payments shall,
subject to the provisions of Section 3.2 hereof, be paid in a lump sum. Any
payments made to any person pursuant to the provisions of this Section 5.3 shall
operate as a complete discharge of all obligations under the Plan with respect
to such deceased Beneficiary and shall not be subject to review by anyone but
shall be final, binding and conclusive on all persons ever interested hereunder.
5.4 - PARTICIPANTS' RIGHTS IN TRUST FUND
No Participant or other person shall have any interest in or any right in,
to or under the Trust Fund, or any part of the assets held thereunder, except as
to the extent expressly provided in the Plan.
5.5 - BENEFITS NOT ASSIGNABLE
Except to the extent required to comply with a qualified domestic relations
order as described in Sections 401(a)(13) and 414(p) of the Internal Revenue
Code, no benefits, rights or accounts shall exist under the Plan which are
subject in any manner to voluntary or involuntary anticipation, alienation,
sale, transfer, assignment, pledge, encumbrance or charge, and any attempt so to
anticipate, alienate, sell, transfer, assign, pledge, encumber or charge the
5-5
same shall be null and void; nor shall any such benefit, right or account under
the Plan be in any manner liable for or subject to the debts, contracts,
liabilities, engagements, torts or other obligations of the person entitled to
such benefit, right or account; nor shall any benefit, right or account under
the Plan constitute an asset in case of the bankruptcy, receivership or divorce
of any person entitled to a benefit under the Plan; and any such benefit, right
or account under the Plan shall be payable only directly to the Participant or
Beneficiary, as the case may be. Where a qualified domestic relations order has
been received by the Committee, the terms and benefits of the Plan will be
considered to have been modified with respect to the Participant affected to the
extent that such order requires benefits to be paid to specified individuals
other than the Participant.
5.6 - BENEFITS PAYABLE TO MINORS AND INCOMPETENTS
Whenever any person entitled to payments under the Plan shall be a minor or
under other legal disability or in the sole judgment of the Committee shall
otherwise be unable to apply such payments to his own best interest and
advantage (as in the case of illness, whether mental or physical, or where the
person not under legal disability is unable to preserve his estate for his own
best interest), the Committee may in the exercise of its discretion direct all
or any portion of such payments to be made in any one or more of the following
ways unless claim shall have been made therefor by an existing and duly
appointed guardian, tutor, conservator, committee or other duly appointed legal
representative, in which event payment shall be made to such representative:
(A) directly to such person unless such person shall be an infant or shall
have been legally adjudicated incompetent at the time of the payment;
(B) to the spouse, child, parent or other blood relative to be expended on
behalf of the person entitled or on behalf of those dependents as to
whom the person entitled has the duty of support; or
(C) to a recognized charity or governmental institution to be expended for
the benefit of the person entitled or for the benefit of those
dependents as to whom the person entitled has the duty of support.
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The decision of the Committee will, in each case, be final and binding upon
all persons, and the Committee shall not be obliged to see to the proper
application or expenditure of any payments so made. Any payment made pursuant to
the power herein conferred upon the Committee shall operate as a complete
discharge of the obligations of the Trustee and of the Committee.
5.7 - CONDITIONS OF EMPLOYMENT NOT AFFECTED BY PLAN
The establishment and maintenance of the Plan will not be construed as
conferring any legal rights upon any Participant to the continuation of his
employment with the Employer, nor will the Plan interfere with the right of the
Employer to discipline, lay off or discharge any Participant. The adoption and
maintenance of the Plan shall not be deemed to constitute a contract between the
Employer and any employee or to be a consideration for, inducement to, or
condition of employment of any person.
5.8 - NOTIFICATION OF MAILING ADDRESS
Each Participant and other person entitled to benefits hereunder shall file
with the Committee from time to time, in writing, his post office address and
each change of post office address, and any check representing payment hereunder
and any communication addressed to a Participant, a former Participant, a
Beneficiary or a pensioner hereunder at his last address filed with the
Committee (or, if no such address has been filed, then at his last address as
indicated on the records of the Employer) shall be binding on such person for
all purposes of the Plan, and neither the Committee nor the Trustee shall be
obliged to search for or ascertain the location of any such person.
If the Committee, for any reason, is in doubt as to whether retirement
income payments are being received by the person entitled thereto, it may, by
registered mail addressed to such person and to such person's designated
Beneficiary, if any, at their address last known to the Committee, notify such
person and his Beneficiary that all unmailed and future retirement income
payments shall be henceforth withheld until the Committee is provided with
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evidence of such person's continued life and his proper mailing address or with
evidence of such person's death. In the event that (i) such notification is
mailed to such person and his designated Beneficiary, (ii) the Committee is not
furnished with evidence of such person's continued life and proper mailing
address or with evidence of his death within three years of the date such
notification was mailed and (iii) the Committee is unable to find any person to
whom payment is due under the provisions of the Plan within three years of the
date such notification was mailed, all retirement income and other benefit
payments due shall be forfeited at the end of such three-year period following
the date such notification was mailed; provided, however, if claim for any
forfeited benefit is subsequently made by any such person to whom payment is due
under the Plan, such forfeited benefits due such person shall be reinstated.
Notwithstanding any provision of the Plan to the contrary, in the event
that the Plan is terminated, the benefits of any missing participants shall be
transferred to the Pension Benefit Guaranty Corporation in accordance with
Section 4050 of the Employee Retirement Income Security Act of 1974, as amended.
5.9 - WRITTEN COMMUNICATIONS REQUIRED
Any notice, request, instruction, or other communication to be given or
made hereunder shall be in writing and may be delivered to the addressee
personally, may be delivered to the addressee by a commercial delivery service
at the last address for notice shown on the Committee's records, or may be
deposited in the United States mail fully postpaid and properly addressed to
such addressee at the last address for notice shown on the Committee's records.
5.10 - BENEFITS PAYABLE AT OFFICE OF TRUSTEE
All benefits hereunder, and installments thereof, shall be payable at the
office of the Trustee.
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5.11 - APPEAL TO COMMITTEE
A Participant or Beneficiary who feels he is being denied any benefit or
right provided under the Plan must file a written claim with the Committee. All
such claims shall be submitted on a form provided by the Committee which shall
be signed by the claimant and shall be considered filed on the date the claim is
received by the Committee.
The Committee shall establish claims procedures in compliance with
applicable law, and such claims procedures shall be set forth in the summary
plan description for the Plan.
6-1
SECTION 6
MISCELLANEOUS PROVISIONS REGARDING THE EMPLOYER
6.1 - CONTRIBUTIONS
No contributions shall be required of or permitted to be made by any
Participant. The Employer intends, but does not guarantee, to make annual
contributions in amounts at least equal to the amounts, if any, required to meet
the minimum funding requirements of Section 412 of the Internal Revenue Code, as
specified in the actuary's valuation reports for the applicable periods of time.
Subject to applicable provisions of law, neither the Employer nor any of its
officers, agents or employees, nor any member of its board of directors, nor any
partner or sole proprietor, guarantees, in any manner the payment of benefits
under the Plan.
6.2 - EMPLOYER'S CONTRIBUTIONS IRREVOCABLE
The Employer shall have no right, title or interest in the Trust Fund or in
any part thereof, and no contributions made thereto shall revert to the Employer
except such part of the Trust Fund, if any, that remains therein after the
satisfaction of all liabilities to persons entitled to benefits under the Plan
and except as provided in the following paragraph.
All contributions to the Plan are made subject to the qualification of the
Plan under Section 401 of the Internal Revenue Code and to their deductibility
under Section 404 of said Code. In the event that (1) the Plan represents a
newly established retirement plan (and not an amendment of an existing
retirement plan) with respect to an Employer, (2) an application for the
determination of the qualification of the Plan is made by the time prescribed by
law for filing the Employer's return for the taxable year in which the Plan was
adopted by such Employer, or by such later date as the Secretary of Treasury may
prescribe, and (3) such qualification of the Plan is denied, the total
contributions of the Employer, adjusted for any earnings or losses of the Trust
Fund attributable thereto, shall be returned to the Employer within one year of
the date of denial of qualification. In the event that a contribution either is
6-2
made by a good faith mistake of fact or is disallowed as a tax deductible
expense under Section 404 of the Internal Revenue Code, the excess of the amount
contributed over either the amount that would have been contributed if there had
not been such a mistake or the amount that is allowed as a tax deductible
expense, as the case may be, with such excess reduced by the net losses, if any,
of the Trust Fund attributable thereto (but without any increase due to the net
earnings, if any, of the Trust Fund attributable thereto), shall be returned to
the Employer within one year of the date of the mistaken payment or the
disallowance of the deduction, as the case may be.
6.3 - FORFEITURES
Forfeitures shall not be used to increase the benefits that any Participant
would otherwise receive under the Plan at any time prior to the termination of
the Plan but shall be anticipated in determining the costs under the Plan.
6.4 - AMENDMENT OF PLAN
The Plan may be amended from time to time in any respect whatever by formal
action on the part of the Sponsoring Employer in the manner described in Section
6.7 hereof specifying such amendment, subject only to the following limitations:
(A) Under no condition shall such amendment result in or permit the return
or repayment to any Employer of any property held or acquired by the
Trustee hereunder or the proceeds thereof or result in or permit the
distribution of any such property for the benefit of anyone other than
the Participants and their Beneficiaries or joint pensioners, except
to the extent provided in Section 6.2 hereof with respect to
contributions that are returnable to the Employer because they are
made by a mistake of fact or are disallowed as a tax deductible
expense under Section 404 of the Internal Revenue Code or because the
Plan is denied qualification under Section 401(a) of said Code and
except to the extent provided by Section 4.5 and Section 6.6 hereof
with respect to termination of the Plan and expenses of
administration, respectively.
(B) Under no condition shall such amendment change the duties or
responsibilities of the Trustee hereunder without its written consent.
(C) No amendment shall be effective to the extent it eliminates or reduces
any Plan benefits or rights that are protected under Section 411(d)(6)
of the Internal Revenue Code unless such protected benefits or rights
6-3
are preserved with respect to benefits accrued to the date of such
amendment or unless such reduction or elimination is otherwise
permitted by the Internal Revenue Service.
Except to the extent permissible to comply with any laws or regulations of
the United States or of any state to qualify this as a tax-exempt plan and
trust, no amendment may be made that would result in a slower rate of vesting
under the Plan for any Participant who has completed at least three years of
Vesting Service as of the effective date of such amendment or, if later, as of
the date such amendment is adopted, unless such amendment provides that each
such Participant may elect, during the period described below, to retain the
rate of vesting in effect under the Plan prior to such amendment in lieu of the
new rate of vesting. The period during which the election described in the
preceding sentence may be made shall begin no later than the date the Plan
amendment is adopted and shall end no earlier than 60 days after (i) the date
the amendment is adopted, (ii) the effective date of such amendment or (iii) the
date the Participant is notified in writing of the amendment by the Committee,
whichever is the latest date to occur.
Subject to the foregoing limitations, any amendment may be made
retroactively which, in the judgment of the Committee, is necessary or advisable
provided that such retroactive amendment does not deprive a Participant, without
his consent, of a right to receive benefits hereunder which have already vested
and matured in such Participant, except such modification or amendment as shall
be necessary to comply with any laws or regulations of the United States or of
any state to qualify this as a tax-exempt plan and trust.
The participation in the Plan of Employers other than the Sponsoring
Employer shall not limit the power of the Sponsoring Employer under the
foregoing provisions, and all amendments by the Sponsoring Employer to the Plan
shall be binding upon all other Employers. The Sponsoring Employer, on behalf of
an Employer, may modify the provisions of the Plan as it pertains only to such
Employer's Employees by the adoption, by formal action on its part in the manner
6-4
described in Section 6.7 hereof, of a Supplement to the Plan specifying such
modifications that shall pertain only to such Employer's Employees. Any such
Supplement to the Plan shall not affect the continued operation of the Plan with
respect to any other Employers.
6.5 - TERMINATION OF PLAN
The Plan may be terminated by the Sponsoring Employer at any time by formal
action, in the manner described in Section 6.7 hereof, specifying (a) that the
Plan is being terminated and (b) the date as of which the termination is to be
effective. In the event the Plan is to be terminated, the Sponsoring Employer
shall notify the Committee and the Trustee of such termination.
The Plan or participation in the Plan may be terminated in the manner
described above with respect to one or more, but less than all, of the Employers
theretofore parties hereto and the Plan continued for the remaining Employer or
Employers. The Plan or participation in the Plan shall automatically terminate
as to a particular Employer only upon dissolution of such Employer or upon its
liquidation, merger or consolidation without provisions being made by its
successor, if any, for the continuation of the Plan.
In the event of the liquidation, dissolution, merger or consolidation of
the Employer under such circumstances that there shall be a successor person,
firm or corporation continuing and carrying on all or a substantial part of its
business, such successor may be substituted for the Employer under the terms of
the Plan by formal action on the part of such successor in the manner described
in Section 6.7 hereof specifying its election to continue the Plan.
Any provisions herein to the contrary notwithstanding, in the event of
termination of the Plan the following will apply:
(a) a disability retirement benefit shall not be payable on behalf of any
Participant whose service is terminated on or after the date of
termination of the Plan by reason of his total and permanent
disability; and
6-5
(b) the death benefits provided under Sections 2.3(G), 2.4(A)(3) and
2.4(B) hereof (or under any Supplements hereto) shall not be payable
on behalf of any Participant whose death occurs on or after the date
of termination of the Plan; provided, however, if the death of the
Participant occurs after the date of termination of the Plan and prior
to (i) the date as of which an annuity is purchased on his behalf to
provide the benefit to which he is entitled as a result of the
termination of the Plan or (ii) the date as of which distribution is
made on his behalf in some other manner as a result of the termination
of the Plan, as the case may be, the amount required to provide the
distribution to which he is entitled as a result of termination of the
Plan shall, subject to the provisions hereof relating to the Qualified
Preretirement Survivor Annuity, be used to provide a benefit to his
Beneficiary; and provided further, however, the minimum qualified
preretirement survivor annuity required under Section 417 of the
Internal Revenue Code shall be provided on behalf of any such
Participant who is married and whose death occurs prior to his Annuity
Starting Date and on or after the date on which an annuity has been
purchased to provide the benefit to which he is entitled as a result
of termination of the Plan.
6.6 - EXPENSES OF ADMINISTRATION
The Employer may pay all expenses incurred in the establishment and
administration of the Plan, including expenses and fees of the Trustee, but it
shall not be obligated to do so, and any such expenses not so paid by the
Employer shall be paid from the Trust Fund. The Trustee, upon direction from the
Committee, shall reimburse the Employer for expenses properly and actually paid
by the Employer on behalf of the Plan.
6.7 - FORMAL ACTION BY EMPLOYER
Any formal action herein permitted or required to be taken by an Employer
shall be:
(a) if and when a partnership, by written instrument executed by one or
more of its general partners or by written instrument executed by a
person or group of persons who has been authorized by written
instrument executed by one or more general partners as having
authority to take such action;
(b) if and when a proprietorship, by written instrument executed by the
proprietor or by written instrument executed by a person or group of
persons who has been authorized by written instrument executed by the
proprietor as having authority to take such action;
6-6
(c) if and when a corporation, by resolution of its board of directors or
other governing board, or by written instrument executed by a person
or group of persons who has been authorized by resolution of its board
of directors or other governing board as having authority to take such
action; or
(d) if and when a joint venture, by formal action on the part of the joint
venturers in the manner described above.
7-1
SECTION 7
ADMINISTRATION
7.1 - ADMINISTRATION BY COMMITTEE
The Plan will be administered by the Retirement Committee appointed by the
Sponsoring Employer by formal action on its part in the manner described in
Section 6.7 hereof. Such Committee will consist of (a) a chairman and at least
two additional members or (b) a single individual. Each member may, but need
not, be a director, proprietor, partner, officer or employee of any Employer,
and each such member shall be appointed by the Sponsoring Employer to serve
until his successor shall be appointed in like manner. Any member of the
Committee may resign by delivering his written resignation to the Sponsoring
Employer and to the other members, if any, of the Committee. The Sponsoring
Employer by formal action on its part in the manner described in Section 6.7
hereof may remove any member of the Committee by so notifying the member and
other Committee members, if any, in writing. Vacancies on the Committee shall be
filled by formal action on the part of the Sponsoring Employer in the manner
described in Section 6.7 hereof.
The Committee, in its discretion, may delegate all or any part of its
responsibilities of administering the provisions of the Plan with respect to any
Employer or group of Employers to an administrative committee which will be
appointed by such Employer or group of Employers by formal action on its or
their part in the manner described in Section 6.7 hereof. In such event,
references to the "Committee" in any provisions hereof which apply with respect
to such delegated responsibilities shall refer to such administrative committee
instead of the Retirement Committee
7-2
..
7.2 - OFFICERS AND EMPLOYEES OF COMMITTEE
The Committee may appoint a secretary who may, but need not, be a member of
the Committee and may employ such agents, clerical and other services, legal
counsel, accountants and actuaries as may be required for the purpose of
administering the Plan. Any person or firm so employed may be a person or firm
then, theretofore or thereafter serving the Employer in any capacity. The
Committee and any individual member of the Committee and any agent thereof shall
be fully protected when relying in good faith upon the advice of the following
professional consultants or advisors employed by the Employer or the Committee:
any attorney insofar as legal matters are concerned, any certified public
accountant insofar as accounting matters are concerned and any enrolled actuary
insofar as actuarial matters are concerned.
7.3 - ACTION BY COMMITTEE
A majority of the members of the Committee shall constitute a quorum
for the transaction of business and shall have full power to act hereunder. The
Committee may act either at a meeting at which a quorum is present or by a
writing subscribed by at least a majority of the members of the Committee then
serving. Any written memorandum signed by the secretary or any member of the
Committee who has been authorized to act on behalf of the Committee shall have
the same force and effect as a formal resolution adopted in open meeting.
Minutes of all meetings of the Committee and a record of any action taken by the
Committee shall be kept in written form by the secretary appointed by the
Committee or, if no secretary has been appointed by the Committee, by an
individual member of the Committee. The Committee shall give to the Trustee any
order, direction, consent or advice required under the terms of the Trust
Agreement, and the Trustee shall be entitled to rely on any instrument delivered
to it and signed by the secretary or any authorized member of the Committee as
evidencing the action of the Committee.
7-3
A member of the Committee may not vote or decide upon any matter relating
solely to himself or vote in any case in which his individual right or claim to
any benefit under the Plan is particularly involved. If, in any case in which
any Committee member is so disqualified to act, the remaining members cannot
agree or if there is only one individual member of the Committee, the Sponsoring
Employer, by formal action on its part in the manner described in Section 6.7
hereof, will appoint a temporary substitute member to exercise all of the powers
of a qualified member concerning the matter in which the disqualified member is
not qualified to act.
7.4 - RULES AND REGULATIONS OF COMMITTEE
The Committee shall have the authority to make such rules and regulations
and to take such action as may be necessary to carry out the provisions of the
Plan and will, subject to the provisions of the Plan, decide any questions
arising in the administration, interpretation and application of the Plan, which
decisions shall be conclusive and binding on all parties. The Committee may
allocate or delegate any part of its authority and duties as it deems expedient.
7.5 - POWERS OF COMMITTEE
In order to effectuate the purposes of the Plan, the Committee shall have
the full power and authority to construe and interpret any and all provisions of
the Plan, to reconcile any inconsistencies and resolve any ambiguities in the
terms of the Plan and to make equitable adjustments for any mistakes or errors
made in the administration of the Plan, and all such actions or determinations
made by the Committee in good faith shall not be subject to review by anyone.
The Committee shall have the power to appoint, in its discretion, one or more
Investment Managers to manage, including the power to acquire or dispose of, all
or any portion of the assets of the Plan and Trust Fund. The Committee shall
also have the power to serve as paying agent for the Trust Fund, if it so
desires, or to appoint, in its discretion, a paying agent or agents to disburse
the benefits payable from the Trust Fund and to authorize and direct the Trustee
7-4
to make distribution to the Committee as paying agent or to such other paying
agent as the Committee shall direct in writing.
7.6 - DUTIES OF COMMITTEE
The Committee shall, as a part of its general duty to supervise and
administer the Plan:
(A) determine all facts and maintain records with respect to any
Employee's age, amount of Compensation, length of service, Hours of
Service, Vesting Service, Credited Service and date of initial
coverage under the Plan, and by application of the facts so determined
and any other facts deemed material, determine the amount, if any, of
benefit payable under the Plan on behalf of a Participant;
(B) establish, carry out and periodically review a funding policy and
method consistent with the objectives of the Plan and the applicable
lawful requirements of Title I of the Employee Retirement Income
Security Act of 1974; provided, however, that any decisions pertaining
to the amount and timing of contributions by the Employer to the Trust
Fund are delegated to the Employer;
(C) give the Trustee specific directions in writing with respect to:
(1) the making of distribution payments, giving the names of the
payees, the amounts to be paid and the time or times when
payments shall be made; and
(2) the making of any other payments which the Trustee is not by the
terms of the Trust Agreement authorized to make without a
direction in writing of the Committee;
(D) furnish the Trustee with such information (including information
relative to the liquidity needs of the Plan) as is deemed necessary
for the Trustee to carry out the purposes of the Trust Agreement;
(E) comply with all applicable lawful reporting and disclosure
requirements of the Employee Retirement Income Security Act of 1974;
(F) comply (or transfer responsibility for compliance to the Trustee) with
all applicable Federal income tax withholding requirements for
distribution payments imposed by the Tax Equity and Fiscal
Responsibility Act of 1982;
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(G) engage on behalf of all Plan Participants an independent qualified
public accountant to examine the financial statements and other
records of the Plan for the purposes of an annual audit and opinion as
to whether the financial statements and schedules in the annual report
of the Plan are presented fairly in conformity with generally accepted
accounting principles, unless such audit is waived by the Secretary of
Labor or his delegate or unless such audit is otherwise not required;
and
(H) engage on behalf of all Plan Participants an enrolled actuary to
prepare required actuarial statements, unless this requirement is
waived by the Secretary of Labor or his delegate or unless such
actuarial statements are otherwise not required.
The foregoing list of express duties is not intended to be either complete
or conclusive, and the Committee shall, in addition, exercise such other powers
and perform such other duties as it may deem necessary, desirable, advisable or
proper for the supervision and administration of the Plan.
7.7 - INDEMNIFICATION OF CERTAIN FIDUCIARIES
To the extent not covered by insurance or if there is a failure to provide
full insurance coverage for any reason and to the extent permissible under
corporate by-laws and other applicable laws and regulations, the Employers agree
to hold harmless and indemnify the members of the Committee against any and all
claims and causes of action by or on behalf of any and all parties whomsoever,
and all losses therefrom, including, without limitation, costs of defense and
attorneys' fees, based upon or arising out of any act or omission relating to or
in connection with the Plan and Trust Agreement other than losses resulting from
any such person's fraud or willful misconduct.
7.8 - ACTUARY
The actuary will do such technical and advisory work as the Committee or
the Employer may request, including analysis of the experience of the Plan from
time to time, the preparation of actuarial tables for the making of computations
thereunder, and the submission of actuarial reports to the Sponsoring Employer
or the Committee, which reports shall contain an actuarial valuation showing the
financial condition of the Plan, a statement of the contributions to be made by
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the Employers and such other information as may be required by the Committee.
The actuary shall be appointed by the Committee with the approval of the
Sponsoring Employer to serve as long as it is agreeable to the Committee, the
Sponsoring Employer and the actuary.
7.9 - FIDUCIARIES
The Trustee is the named fiduciary hereunder with respect to the powers,
duties and responsibilities of investment of the Trust Fund; the board of
directors of the Sponsoring Employer is the named fiduciary with respect to the
powers, duties and the responsibilities of (a) appointing the members of the
Committee in the manner set out in Section 7.1 hereof, (b) appointing the
Trustee or Trustees in the manner set out in the Trust Agreement, (c) amending
and terminating the Plan and Trust in accordance with the provisions of the Plan
and Trust Agreement and (d) reviewing annually the annual report of the Trustee
and the activities of the Trustee, any Investment Manager and the Committee
relating to the Plan in order to determine whether any replacement of those
persons is necessary; and the Committee is the plan administrator and is the
named fiduciary hereunder with respect to the other powers, duties and
responsibilities of the administration of the Plan; provided, however, that
certain powers, duties and responsibilities of each of said named fiduciaries
are specifically delegated to others under the provisions of the Plan and Trust
Agreement, and other powers, duties and responsibilities of any fiduciaries may
be delegated by written agreement to others to the extent permitted under the
provisions of the Plan and Trust Agreement.
The powers and duties of each fiduciary hereunder, whether or not a named
fiduciary, shall be limited to those specifically delegated to each of them
under the terms of the Plan and Trust Agreement. It is intended that the
provisions of the Plan and Trust Agreement allocate to each fiduciary the
individual responsibilities for the prudent execution of the functions assigned
to each fiduciary. None of the allocated responsibilities or any other
responsibilities shall be shared by two or more fiduciaries unless such sharing
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shall be provided by a specific provision in the Plan or the Trust Agreement. If
any of the enumerated responsibilities of a fiduciary are specifically waived by
the Secretary of Labor, then such enumerated responsibilities shall also be
deemed to be waived for the purposes of the Plan and Trust Agreement. Whenever
one fiduciary is required by the Plan or the Trust Agreement to follow the
directions of another fiduciary, the two fiduciaries shall not be deemed to have
been assigned a share of any responsibility, but the responsibility of the
fiduciary giving the directions shall be deemed to be his sole responsibility
and the responsibility of the fiduciary receiving those directions shall be to
follow same insofar as such instructions on their face are proper under
applicable law. Any fiduciary may employ one or more persons to render advice
with respect to any responsibility such fiduciary has under the Plan or Trust
Agreement.
Each fiduciary may, but need not, be a director, proprietor, partner,
officer or employee of the Employer. Nothing in the Plan shall be construed to
prohibit any fiduciary from:
(a) serving in more than one fiduciary capacity with respect to the
Plan and Trust Agreement;
(b) receiving any benefit to which he may be entitled as a
Participant or Beneficiary in the Plan, so long as the benefit is
computed and paid on a basis that is consistent with the terms of
the Plan as applied to all other Participants and Beneficiaries;
or
(c) receiving any reasonable compensation for services rendered, or
for the reimbursement of expenses properly and actually incurred
in the performance of his duties with respect to the Plan, except
that no person so serving who already receives full-time pay from
an Employer shall receive compensation from the Plan, except for
reimbursement of expenses properly and actually incurred.
Each fiduciary shall be bonded as required by applicable law or statute of
the United States, or of any state having appropriate jurisdiction, unless such
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bond may under such law or statute be waived by the parties to the Trust
Agreement. The Employer shall pay the cost of bonding any fiduciary who is an
employee of the Employer.
7.10 - APPLICABLE LAW
The Plan will, unless superseded by federal law, be construed and enforced
according to the laws of the State of Texas, and all provisions of the Plan
will, unless superseded by federal law, be administered according to the laws of
the said state.
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SECTION 8
TRUST FUND
8.1 - PURPOSE OF TRUST FUND
The Trust Fund has been created and will be maintained for the purposes of
the Plan, and the moneys thereof will be invested in accordance with the terms
of the agreement and declaration of trust which forms a part of the Plan. All
contributions will be paid into the Trust Fund, and all benefits under the Plan
will be paid from the Trust Fund, except to the extent provided by Section 3.5
hereof.
8.2 - BENEFITS SUPPORTED ONLY BY TRUST FUND
Subject to applicable provisions of law, any person having any claim under
the Plan will look solely to the assets of the Trust Fund for satisfaction.
8.3 - TRUST FUND APPLICABLE ONLY TO PAYMENT OF BENEFITS
The Trust Fund will be used and applied only in accordance with the
provisions of the Plan, to provide the benefits thereof, and no part of the
corpus or income of the Trust Fund will be used for, or diverted to, purposes
other than for the exclusive benefit of Participants and other persons
thereunder entitled to benefits, except to the extent provided in Section 6.2
hereof with respect to contributions that are returnable to the Employer because
they are made by a mistake of fact or are disallowed as a tax deductible expense
under Section 404 of the Internal Revenue Code or because the Plan is denied
qualification under Section 401(a) of said Code and except to the extent
provided in Section 4.5 and Section 6.6 hereof with respect to termination of
the Plan and expenses of administration, respectively.
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IN WITNESS WHEREOF, CAPITAL SOUTHWEST CORPORATION, CAPITAL SOUTHWEST
MANAGEMENT CORPORATION, JET-LUBE, INC., THE RECTORSEAL CORPORATION, THE WHITMORE
MANUFACTURING COMPANY, SMOKE GUARD, INC. and BLUE MAGIC, INC. have caused this
instrument to be executed by their duly authorized officers on this _____ day of
_________________, 20____, effective as of April 1, 2006.
CAPITAL SOUTHWEST CORPORATION
By
Title:
CAPITAL SOUTHWEST MANAGEMENT CORPORATION
By
Title:
JET LUBE, INC.
By
Title:
THE RECTORSEAL CORPORATION
By
Title:
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THE WHITMORE MANUFACTURING COMPANY
By
Title:
SMOKE GUARD, INC.
By
Title:
BLUE MAGIC, INC.
By
Title: