EXHIBIT 99(a)
XXXXXXXX & XXXXXX TRUST COMPANY
DEFINED CONTRIBUTION MASTER PLAN
AND
TRUST AGREEMENT
TABLE OF CONTENTS
ALPHABETICAL LISTING OF DEFINITIONS vi
ARTICLE I, DEFINITIONS
1.01 Employer 1.01
1.02 Trustee 1.01
1.03 Plan 1.01
1.04 Adoption Agreement 1.01
1.05 Plan Administrator 1.02
1.06 Advisory Committee 1.02
1.07 Employee 1.02
1.08 Self-Employed Individual/Owner-Employee 1.02
1.09 Highly Compensated Employee 1.02
1.10 Participant 1.03
1.11 Beneficiary 1.03
1.12 Compensation 1.03
1.13 Earned Income 1.05
1.14 Account 1.05
1.15 Accrued Benefit 1.05
1.16 Nonforfeitable 1.05
1.17 Plan Year/Limitation Year 1.05
1.18 Effective Date 1.05
1.19 Plan Entry Date 1.05
1.20 Accounting Date 1.05
1.21 Trust 1.05
1.22 Trust Fund 1.05
1.23 Nontransferable Annuity 1.05
1.24 ERISA 1.06
1.25 Code 1.06
1.26 Service 1.06
1.27 Hour of Service 1.06
1.28 Disability 1.07
1.29 Service for Predecessor Employer 1.07
1.30 Related Employers 1.07
1.31 Leased Employees 1.08
1.32 Special Rules for Owner-Employers 1.08
1.33 Determination of Top Heavy Status 1.09
1.34 Paired Plans 1.10
ARTICLE II, EMPLOYEE PARTICIPANTS
2.01 Eligibility 2.01
2.02 Year of Service - Participation 2.01
2.03 Break in Service - Participation 2.01
2.04 Participation upon Re-employment 2.02
2.05 Change in Employee Status 2.02
2.06 Election Not to Participate 2.02
ARTICLE III, EMPLOYER CONTRIBUTIONS AND FORFEITURES
3.01 Amount 3.01
3.02 Determination of Contribution 3.01
3.03 Time of Payment of Contribution 3.01
3.04 Contribution Allocation 3.01
3.05 Forfeiture Allocation 3.03
3.06 Accrual of Benefit 3.03
3.07-
3.16 Limitations on Allocations 3.05
3.17 Special Allocation Limitation 3.07
ii
3.18 Defined Benefit Plan Limitation 3.07
3.19 Definitions - Article III 3.07
ARTICLE IV, PARTICIPANT CONTRIBUTIONS
4.01 Participant Nondeductible Contributions 4.01
4.02 Participant Deductible Contributions 4.01
4.03 Participant Rollover Contributions 4.01
4.04 Participant Contribution - Forfeitability 4.02
4.05 Participant Contribution - Withdrawal/
Distribution 4.02
4.06 Participant Contribution - Accrued Benefit 4.02
ARTICLE V, TERMINATION OF SERVICE - PARTICIPANT VESTING
5.01 Normal Retirement Age 5.01
5.02 Participant Disability or Death 5.01
5.03 Vesting Schedule 5.01
5.04 Cash-Out Distributions to Partially-Vested
Participants/Restoration of
Forfeited Accrued Benefit 5.01
5.05 Segregated Account for Repaid Amount 5.03
5.06 Year of Service - Vesting 5.03
5.07 Break in Service - Vesting 5.03
5.08 Included Years of Service - Vesting 5.03
5.09 Forfeiture Occurs 5.03
ARTICLE VI, TIME AND METHOD OF PAYMENT OF BENEFITS
6.01 Time of Payment of Accrued Benefit 6.01
6.02 Method of Payment of Accrued Benefit 6.03
6.03 Benefit Payment Elections 6.05
6.04 Annuity Distributions to Participants and
Surviving Spouses 6.06
6.05 Waiver Election - Qualified Joint and
Survivor Annuity 6.07
6.06 Waiver Election - Preretirement Survivor Annuity 6.08
6.07 Distributions Under Domestic Relations Orders 6.09
ARTICLE VII, EMPLOYER ADMINISTRATIVE PROVISIONS
7.01 Information to Committee 7.01
7.02 No Liability 7.01
7.03 Indemnity of Certain Fiduciaries 7.01
7.04 Employer Direction of Investment 7.01
7.05 Amendment to Vesting Schedule 7.01
ARTICLE VIII, PARTICIPANT ADMINISTRATIVE PROVISIONS
8.01 Beneficiary Designation 8.01
8.02 No Beneficiary Designation/Death of Beneficiary 8.01
8.03 Personal Data to Committee 8.02
8.04 Address for Notification 8.02
8.05 Assignment or Alienation 8.02
8.06 Notice of Change in Terms 8.02
8.07 Litigation Against the Trust 8.02
8.08 Information Available 8.02
8.09 Appeal Procedure for Denial of Benefits 8.02
8.10 Participant Direction of Investment 8.03
ARTICLE IX, ADVISORY COMMITTEE - DUTIES WITH RESPECT TO
PARTICIPANTS' ACCOUNTS
9.01 Members' Compensation, Expenses 9.01
iii
9.02 Term 9.01
9.03 Powers 9.01
9.04 General 9.01
9.05 Funding Policy 9.02
9.06 Manner of Action 9.02
9.07 Authorized Representative 9.02
9.08 Interested Member 9.02
9.09 Individual Accounts 9.02
9.10 Value of Participant's Accrued Benefit 9.02
9.11 Allocation and Distribution of Net Income
Gain or Loss 9.03
9.12 Individual Statement 9.03
9.13 Account Charged 9.03
9.14 Unclaimed Account Procedure 9.04
ARTICLE X, CUSTODIAN/TRUSTEE, POWERS AND DUTIES
10.01 Acceptance 10.01
10.02 Receipt of Contributions 10.01
10.03 Investment Powers 10.01
10.04 Records and Statements 10.05
10.05 Fees and Expenses from Fund 10.06
10.06 Parties to Litigation 10.06
10.07 Professional Agents 10.06
10.08 Distribution of Cash or Property 10.06
10.09 Distribution Directions 10.06
10.10 Third Party/Multiple Trustees 10.06
10.11 Resignation 10.06
10.12 Removal 10.07
10.13 Interim Duties and Successor Trustee 10.07
10.14 Valuation of Trust 10.07
10.15 Limitation on Liability - If Investment Manager,
Ancillary Trustee or Independent Fiduciary
Appointed 10.07
10.16 Investment in Group Trust Fund 10.07
10.17 Appointment of Ancillary Trustee or
Independent Fiduciary 10.08
ARTICLE XI, PROVISIONS RELATING TO INSURANCE AND INSURANCE
COMPANY
11.01 Insurance Benefit 11.01
11.02 Limitation on Life Insurance Protection 11.01
11.03 Definitions 11.02
11.04 Dividend Plan 11.02
11.05 Insurance Company Not a Party to Agreement 11.02
11.06 Insurance Company Not Responsible for
Trustee's Actions 11.03
11.07 Insurance Company Reliance on Trustee's Signature 11.03
11.08 Acquittance 11.03
11.09 Duties of Insurance Company 11.03
ARTICLE XII, MISCELLANEOUS
12.01 Evidence 12.01
12.02 No Responsibility for Employer Action 12.01
12.03 Fiduciaries Not Insurers 12.01
12.04 Waiver of Notice 12.01
12.05 Successors 12.01
12.06 Word Usage 12.01
12.07 State Law 12.01
iv
12.08 Employer's Right to Participate 12.01
12.09 Employment Not Guaranteed 12.02
ARTICLE XIII, EXCLUSIVE BENEFIT, AMENDMENT, TERMINATION
13.01 Exclusive Benefit 13.01
13.02 Amendment By Employer 13.01
13.03 Amendment By Regional Prototype Plan Sponsor 13.02
13.04 Discontinuance 13.02
13.05 Full Vesting on Termination 13.02
13.06 Merger/Direct Transfer 13.02
13.07 Termination 13.03
ARTICLE XIV, CODE Section 401(k) AND CODE Section401(m)
ARRANGEMENTS
14.01 Application 14.01
14.02 Code Section 401(k) Arrangement 14.01
14.03 Definitions 14.02
14.04 Matching Contributions/Employee Contributions 14.03
14.05 Time of Payment of Contributions 14.03
14.06 Special Allocation Provisions - Deferral
Contributions, Matching Contributions and
Qualified Nonelective Contributions 14.04
14.07 Annual Elective Deferral Limitation 14.05
14.08 Actual Deferral Percentage ("ADP") Test 14.06
14.09 Nondiscrimination Rules for Employer Matching
Contributions/Participant Nondeductible
Contributions 14.07
14.10 Multiple Use Limitation 14.09
14.11 Distribution Restrictions 14.10
14.12 Special Allocation Rules 14.11
ARTICLE A - APPENDIX TO BASIC PLAN DOCUMENT A-1
ARTICLE B - APPENDIX TO BASIC PLAN DOCUMENT B-1
ARTICLE C - APPENDIX TO BASIC PLAN DOCUMENT C-1
ARTICLE D - APPENDIX TO BASIC PLAN DOCUMENT D-1
v
ALPHABETICAL LISTING OF DEFINITIONS
Plan Definition Section Reference
(Page Number)
100% Limitation 3.19(l) (3.09)
Account 1.14 (1.05)
Accounting Date 1.20 (1.05)
Accrued Benefit 1.15 (1.05)
Actual Deferral Percentage ("ADP") Test 14.08 (14.06)
Adoption Agreement 1.04 (1.01)
Advisory Committee 1.06 (1.02)
Annual Addition 3.19(a) (3.07)
Average Contribution Percentage Test 14.09 (14.07)
Beneficiary 1.11 (1.03)
Break in Service for Eligibility Purposes 2.03 (2.01)
Break in Service for Vesting Purposes 5.07 (5.03)
Cash-out Distribution 5.04 (5.01)
Code 1.25 (1.06)
Code Section 411(d)(6) Protected Benefits 13.02 (13.01)
Compensation 1.12 (1.03)
Compensation for Code Section 401(k) Purposes 14.03(f) (14.02)
Compensation for Code Section 415 Purposes 3.19(b) (3.07)
Compensation for Top Heavy Purposes 1.33(B)(3) (1.10)
Contract(s) 11.03(c) (11.02)
Custodian Designation 10.03[B] (10.02)
Deemed Cash-out Rule 5.04(C) (5.02)
Deferral Contributions 14.03(g) (14.02)
Deferral Contributions Account 14.06 (14.04)
Defined Benefit Plan 3.19(i) (3.08)
Defined Benefit Plan Fraction 3.19(j) (3.08)
Defined Contribution Plan 3.19(h) (3.08)
Defined Contribution Plan Fraction 3.19(k) (3.09)
Determination Date 1.33(B)(7) (1.10)
Disability 1.28 (1.07)
Distribution Date 6.01 (6.01)
Distribution Restrictions 14.03(m) (14.03)
Earned Income 1.13 (1.05)
Effective Date 1.18 (1.05)
Elective Deferrals 14.03(h) (14.02)
Elective Transfer 13.06(A) (13.02)
Eligible Employee 14.03(c) (14.02)
Employee 1.07 (1.02)
Employee Contributions 14.03(n) (14.03)
Employer 1.01 (1.01)
Employer Contribution Account 14.06 (14.04)
Employer for Code Section 415 Purposes 3.19(c) (3.08)
Employer for Top Heavy Purposes 1.33(B)(6) (1.10)
Employment Commencement Date 2.02 (2.01)
ERISA 1.24 (1.06)
Excess Aggregate Contributions 14.09 (14.07)
Excess Amount 3.19(d) (3.08)
Excess Contributions 14.08 (14.06)
Exempt Participant 8.01 (8.01)
Forfeiture Break in Service 5.08 (5.03)
Group Trust Fund 10.16 (10.07)
Hardship 6.01(A)(4) (6.02)
vi
Hardship for Code Section 401(k) Purposes 14.11 (14.10)
Highly Compensated Employee 1.09 (1.02)
Highly Compensated Group 14.03(d) (14.02)
Hour of Service 1.27 (1.06)
Incidental Insurance Benefits 11.01 (11.01)
Insurable Participant 11.03(d) (11.02)
Investment Manager 9.04(i) (9.01)
Issuing Insurance Company 11.03(b) (11.02)
Joint and Survivor Annuity 6.04(A) (6.06)
Key Employee 1.33(B)(1) (1.10)
Leased Employees 1.31 (1.08)
Limitation Year 1.17 and 3.19(e) (1.05) and (3.08)
Loan Policy 9.04(A) (9.02)
Mandatory Contributions 14.04 (14.03)
Mandatory Contributions Account 14.04 (14.03)
Master or Prototype Plan 3.19(f) (3.08)
Matching Contributions 14.03(i) (14.02)
Maximum Permissible Amount 3.19(g) (3.08)
Minimum Distribution Incidental Benefit (MDIB) 6.02(A) (6.03)
Multiple Use Limitation 14.10 (14.09)
Named Fiduciary 10.03[D] (10.04)
Nonelective Contributions 14.03(j) (14.03)
Nonforfeitable 1.16 (1.05)
Nonhighly Compensated Employee 14.03(b) (14.02)
Nonhighly Compensated Group 14.03(e) (14.02)
Non-Key Employee 1.33(B)(2) (1.10)
Nontransferable Annuity 1.23 (1.05)
Normal Retirement Age 5.01 (5.01)
Owner-Employee 1.08 (1.02)
Paired Plans 1.34 (1.10)
Participant 1.10 (1.03)
Participant Deductible Contributions 4.02 (4.01)
Participant Forfeiture 3.05 (3.03)
Participant Loans 10.03[E] (10.05)
Participant Nondeductible Contributions 4.01 (4.01)
Permissive Aggregation Group 1.33(B)(5) (1.10)
Plan 1.03 (1.01)
Plan Administrator 1.05 (1.02)
Plan Entry Date 1.19 (1.05)
Plan Year 1.17 (1.05)
Policy 11.03(a) (11.02)
Predecessor Employer 1.29 (1.07)
Preretirement Survivor Annuity 6.04(B) (6.06)
Qualified Domestic Relations Order 6.07 (6.09)
Qualified Matching Contributions 14.03(k) (14.03)
Qualified Nonelective Contributions 14.03(l) (14.03)
Qualifying Employer Real Property 10.03[F] (10.05)
Qualifying Employer Securities 10.03[F] (10.05)
Related Employers 1.30 (1.07)
Required Aggregation Group 1.33(B)(4) (1.10)
Required Beginning Date 6.01(B) (6.02)
Rollover Contributions 4.03 (4.01)
Self-Employed Individual 1.08 (1.02)
Service 1.26 (1.06)
Term Life Insurance Contract 11.03 (11.02)
Top Heavy Minimum Allocation 3.04(B) (3.01)
Top Heavy Ratio 1.33 (1.09)
Trust 1.21 (1.05)
vii
Trustee 1.02 (1.01)
Trustee Designation 10.03[A] (10.01)
Trust Fund 1.22 (1.05)
Weighted Average Allocation Method 14.12 (14.11)
Year of Service for Eligibility Purposes 2.02 (2.01)
Year of Service for Vesting Purposes 5.06 (5.03)
viii
XXXXXXXX & XXXXXX TRUST COMPANY
-------------------------------
DEFINED CONTRIBUTION MASTER PLAN AND TRUST AGREEMENT
BASIC PLAN DOCUMENT # 01
XXXXXXXX & XXXXXX TRUST COMPANY, in its capacity as Master Plan
-------------------------------
Sponsor, establishes this Master Plan intended to conform to and
qualify under Section 401 and Section 501 of the Internal Revenue
Code of 1986, as amended. An Employer establishes a Plan and
Trust under this Master Plan by executing an Adoption Agreement.
If the Employer adopts this Plan as a restated Plan in
substitution for, and in amendment of, an existing plan, the
provisions of this Plan, as a restated Plan, apply solely to an
Employee whose employment with the Employer terminates on or
after the restated Effective Date of the Employer's Plan. If an
Employee's employment with the Employer terminates prior to the
restated Effective Date, that Employee is entitled to benefits
under the Plan as the Plan existed on the date of the Employee's
termination of employment.
ARTICLE I
DEFINITIONS
1.01 "Employer" means each employer who adopts this Plan by
executing an Adoption Agreement.
1.02 "Trustee" means the person or persons who as Trustee
execute the Employer's Adoption Agreement, or any successor in
office who in writing accepts the position of Trustee. The
Employer must designate in its Adoption Agreement whether the
Trustee will administer the Trust as a discretionary Trustee or
as a nondiscretionary Trustee. If a person acts as a
discretionary Trustee, the Employer also may appoint a Custodian.
See Article X. If the Master Plan Sponsor is a bank, savings and
loan, credit union or similar financial institution, a person
other than the Master Plan Sponsor (or its affiliate) may not
serve as Trustee or as Custodian of the Employer's Plan without
the written consent of the Master Plan Sponsor.
1.03 "Plan" means the retirement plan established or
continued by the Employer in the form of this Agreement,
including the Adoption Agreement under which the Employer has
elected to participate in this Master Plan. The Employer must
designate the name of the Plan in its Adoption Agreement. An
Employer may execute more than one Adoption Agreement offered
under this Master Plan, each of which will constitute a separate
Plan and Trust established or continued by that Employer. The
Plan and the Trust created by each adopting Employer is a
separate Plan and a separate Trust, independent from the plan and
the trust of any other employer adopting this Master Plan. All
section references within the Plan are Plan section references
unless the context clearly indicates otherwise.
1.04 "Adoption Agreement" means the document executed by
each Employer adopting this Master Plan. The terms of this Master
Plan as modified by the terms of an adopting Employer's Adoption
Agreement constitute a separate Plan and Trust to be construed as
a single Agreement. Each elective provision of the Adoption
Agreement corresponds by section reference to the section of the
Plan which grants the election. Each Adoption Agreement offered
under this Master Plan is either a Nonstandardized Plan or a
Standardized Plan, as identified in the preamble to that Adoption
Agreement. The provisions of this Master Plan apply equally to
Nonstandardized Plans and to Standardized Plans unless otherwise
specified.
1.05 "Plan Administrator" is the Employer unless the
Employer designates another person to hold the position of Plan
Administrator. In addition to his other duties, the Plan
Administrator has full responsibility for compliance with the
reporting and disclosure rules under ERISA as respects this
Agreement.
1.06 "Advisory Committee" means the Employer's Advisory
Committee as from time to time constituted.
1.07 "Employee" means any employee (including a Self-
Employed Individual) of the Employer. The Employer must specify
in its Adoption Agreement any Employee, or class of Employees,
not eligible to participate in the Plan. If the Employer elects
to exclude collective bargaining employees, the exclusion applies
to any employee of the Employer included in a unit of employees
covered by an agreement which the Secretary of Labor finds to be
a collective bargaining agreement between employee
representatives and one or more employers unless the collective
bargaining agreement requires the employee to be included within
the Plan. The term "employee representatives" does not include
any organization more than half the members of which are owners,
officers, or executives of the Employer.
1.08 "Self-Employed Individual/Owner-Employee." "Self-
Employed Individual" means an individual who has Earned Income
(or who would have had Earned Income but for the fact that the
trade or business did not have net earnings) for the taxable year
from the trade or business for which the Plan is established.
"Owner-Employee" means a Self-Employed Individual who is the sole
proprietor in the case of a sole proprietorship. If the Employer
is a partnership, "Owner-Employee" means a Self-Employed
Individual who is a partner and owns more than 10% of either the
capital or profits interest of the partnership.
1.09 "Highly Compensated Employee" means an Employee who,
during the Plan Year or during the preceding 12-month period:
(a) is a more than 5% owner of the Employer (applying the
constructive ownership rules of Code Section 318, and applying
the principles of Code Section 318, for an unincorporated
entity);
(b) has Compensation in excess of $75,000 (as adjusted by the
Commissioner of Internal Revenue for the relevant year);
(c) has Compensation in excess of $50,000 (as adjusted by the
Commissioner of Internal Revenue for the relevant year) and is
part of the top-paid 20% group of employees (based on
Compensation for the relevant year); or
(d) has Compensation in excess of 50% of the dollar amount
prescribed in Code Section 415(b)(1)(A) (relating to defined
benefit plans) and is an officer of the Employer.
If the Employee satisfies the definition in clause (b), (c) or
(d) in the Plan Year but does not satisfy clause (b), (c) or (d)
during the preceding 12-month period and does not satisfy clause
(a) in either period, the Employee is a Highly Compensated
Employee only if he is one of the 100 most highly compensated
Employees for the Plan Year. The number of officers taken into
account under clause (d) will not exceed the greater of 3 or 10%
of the total number (after application of the Code Section 414(q)
exclusions) of Employees, but no more than 50 officers. If no
Employee satisfies the Compensation requirement in clause (d) for
the relevant year, the Advisory Committee will treat the highest
paid officer as satisfying clause (d) for that year.
For purposes of this Section 1.09, "Compensation" means
Compensation as defined in Section 1.12, except any exclusions
from Compensation elected in the Employer's Adoption Agreement
Section 1.12 do not apply, and Compensation must include
"elective contributions" (as defined in Section 1.12). The
Advisory Committee must make the determination of who is a Highly
Compensated Employee, including the determinations of the number
and identity of the top paid 20% group, the top 100 paid
Employees, the number of officers includible in clause (d) and
the relevant Compensation, consistent with Code Section 414(q)
and regulations issued under that Code section. The Employer may
make a calendar year election to determine the Highly Compensated
Employees for the Plan Year, as prescribed by Treasury
regulations. A calendar year election must apply to all plans and
arrangements of the Employer. For purposes of applying any
nondiscrimination test required under the Plan or under the Code,
in a manner consistent with applicable Treasury regulations, the
Advisory Committee will treat a Highly Compensated Employee and
all family members (a spouse, a lineal ascendant or descendant,
or a spouse of a lineal ascendant or descendant) as a single
Highly Compensated Employee, but only if the Highly Compensated
Employee is a more than 5% owner or is one of the 10 Highly
Compensated Employees with the greatest Compensation for the Plan
Year. This aggregation rule applies to a family member even if
that family member is a Highly Compensated Employee without
family aggregation.
The term "Highly Compensated Employee" also includes any former
Employee who separated from Service (or has a deemed Separation
from Service, as determined under Treasury regulations) prior to
the Plan Year, performs no Service for the Employer during the
Plan Year, and was a Highly Compensated Employee either for the
separation year or any Plan Year ending on or after his 55th
birthday. If the former Employee's Separation from Service
occurred prior to January 1, 1987, he is a Highly Compensated
Employee only if he satisfied clause (a) of this Section 1.09 or
received Compensation in excess of $50,000 during: (1) the year
of his Separation from Service (or the prior year); or (2) any
year ending after his 54th birthday.
1.10 "Participant" is an Employee who is eligible to be and
becomes a Participant in accordance with the provisions of
Section 2.01.
1.11 "Beneficiary" is a person designated by a Participant
who is or may become entitled to a benefit under the Plan. A
Beneficiary who becomes entitled to a benefit under the Plan
remains a Beneficiary under the Plan until the Trustee has fully
distributed his benefit to him. A Beneficiary's right to (and the
Plan Administrator's, the Advisory Committee's or a Trustee's
duty to provide to the Beneficiary) information or data
concerning the Plan does not arise until he first becomes
entitled to receive a benefit under the Plan.
1.12 "Compensation" means, except as provided in the
Employer's Adoption Agreement, the Participant's Earned Income,
wages, salaries, fees for professional service and other amounts
received for personal services actually rendered in the course of
employment with the Employer maintaining the plan (including, but
not limited to, commissions paid salesmen, compensation for
services on the basis of a percentage of profits, commissions on
insurance premiums, tips and bonuses). The Employer must elect in
its Adoption Agreement whether to include elective contributions
in the definition of Compensation. "Elective contributions" are
amounts excludible from the Employee's gross income under Code
Section Section 125, 402(a)(8), 402(h) or 403(b), and contributed
by the Employer, at the Employee's election, to a Code Section
401(k) arrangement, a Simplified Employee Pension, cafeteria plan
or tax-sheltered annuity. The term "Compensation" does not
include:
(a) Employer contributions (other than "elective
contributions," if includible in the definition of Compensation
under Section 1.12 of the Employer's Adoption Agreement) to a
plan of deferred compensation to the extent the contributions
are not included in the gross income of the Employee for the
taxable year in which contributed, on behalf of an Employee to
a Simplified Employee Pension Plan to the extent such
contributions are excludible from the Employee's gross income,
and any distributions from a plan of deferred compensation,
regardless of whether such amounts are includible in the gross
income of the Employee when distributed.
(b) Amounts realized from the exercise of a non-qualified stock
option, or when restricted stock (or property) held by an
Employee either becomes freely transferable or is no longer
subject to a substantial risk of forfeiture.
(c) Amounts realized from the sale, exchange or other
disposition of stock acquired under a stock option described in
Part II, Subchapter D, Chapter 1 of the Code.
(d) Other amounts which receive special tax benefits, such as
premiums for group term life insurance (but only to the extent
that the premiums are not includible in the gross income of the
Employee), or contributions made by an Employer (whether or not
under a salary reduction agreement) towards the purchase of an
annuity contract described in Code Section 403(b) (whether or
not the contributions are excludible from the gross income of
the Employee), other than "elective contributions," if elected
in the Employer's Adoption Agreement.
Any reference in this Plan to Compensation is a reference to
the definition in this Section 1.12, unless the Plan reference
specifies a modification to this definition. The Advisory
Committee will take into account only Compensation actually paid
for the relevant period. A Compensation payment includes
Compensation by the Employer through another person under the
common paymaster provisions in Code Section Section 3121 and
3306.
(A) Limitations on Compensation.
(1) Compensation dollar limitation. For any Plan Year beginning
after December 31, 1988, the Advisory Committee must take into
account only the first $200,000 (or beginning January 1, 1990,
such larger amount as the Commissioner of Internal Revenue may
prescribe) of any Participant's Compensation. For any Plan Year
beginning prior to January 1, 1989, this $200,000 limitation (but
not the family aggregation requirement described in the next
paragraph) applies only if the Plan is top heavy for such Plan
Year or operates as a deemed top heavy plan for such Plan Year.
(2) Application of compensation limitation to certain family
members. The $200,000 Compensation limitation applies to the
combined Compensation of the Employee and of any family member
aggregated with the Employee under Section 1.09 who is either (i)
the Employee's spouse; or (ii) the Employee's lineal descendant
under the age of 19. If, for a Plan Year, the combined
Compensation of the Employee and such family members who are
Participants entitled to an allocation for that Plan Year exceeds
the $200,000 (or adjusted) limitation, "Compensation" for each
such Participant, for purposes of the contribution and allocation
provisions of Article III, means his Adjusted Compensation.
Adjusted Compensation is the amount which bears the same ratio to
the $200,000 (or adjusted) limitation as the affected
Participant's Compensation (without regard to the $200,000
Compensation limitation) bears to the combined Compensation of
all the affected Participants in the family unit. If the Plan
uses permitted disparity, the Advisory Committee must determine
the integration level of each affected family member Participant
prior to the proration of the $200,000 Compensation limitation,
but the combined integration level of the affected Participants
may not exceed $200,000 (or the adjusted limitation). The
combined Excess Compensation of the affected Participants in the
family unit may not exceed $200,000 (or the adjusted limitation)
minus the affected Participants' combined integration level (as
determined under the preceding sentence). If the combined Excess
Compensation exceeds this limitation, the Advisory Committee will
prorate the Excess Compensation limitation among the affected
Participants in the family unit in proportion to each such
individual's Adjusted Compensation minus his integration level.
If the Employer's Plan is a Nonstandardized Plan, the Employer
may elect to use a different method in determining the Adjusted
Compensation of the affected Participants by specifying that
method in an addendum to the Adoption Agreement, numbered Section
1.12.
(B) Nondiscrimination. For purposes of determining whether the
Plan discriminates in favor of Highly Compensated Employees,
Compensation means Compensation as defined in this Section 1.12,
except: (1) the Employer may elect to include or to exclude
elective contributions, irrespective of the Employer's election
in its Adoption Agreement regarding elective contributions; and
(2) the Employer will not give effect to any elections made in
the "modifications to Compensation definition" section of
Adoption Agreement Section 1.12. The Employer's election
described in clause (1) must be consistent and uniform with
respect to all Employees and all plans of the Employer for any
particular Plan Year. If the Employer's Plan is a Nonstandardized
Plan, the Employer, irrespective of clause (2), may elect to
exclude from this nondiscrimination definition of Compensation
any items of Compensation excludible under Code Section 414(s)
and the applicable Treasury regulations, provided such adjusted
definition conforms to the nondiscrimination requirements of
those regulations.
1.13 "Earned Income" means net earnings from self-employment
in the trade or business with respect to which the Employer has
established the Plan, provided personal services of the
individual are a material income producing factor. The Advisory
Committee will determine net earnings without regard to items
excluded from gross income and the deductions allocable to those
items. The Advisory Committee will determine net earnings after
the deduction allowed to the Self-Employed Individual for all
contributions made by the Employer to a qualified plan and, for
Plan Years beginning after December 31, 1989, the deduction
allowed to the Self-Employed under Code Section 164(f) for self-
employment taxes.
1.14 "Account" means the separate account(s) which the
Advisory Committee or the Trustee maintains for a Participant
under the Employer's Plan.
1.15 "Accrued Benefit" means the amount standing in a
Participant's Account(s) as of any date derived from both
Employer contributions and Employee contributions, if any.
1.16 "Nonforfeitable" means a Participant's or Beneficiary's
unconditional claim, legally enforceable against the Plan, to the
Participant's Accrued Benefit.
1.17 "Plan Year" means the fiscal year of the Plan, the
consecutive month period specified in the Employer's Adoption
Agreement. The Employer's Adoption Agreement also must specify
the "Limitation Year" applicable to the limitations on
allocations described in Article III. If the Employer maintains
Paired Plans, each Plan must have the same Plan Year.
1.18 "Effective Date" of this Plan is the date specified in
the Employer's Adoption Agreement.
1.19 "Plan Entry Date" means the date(s) specified in
Section 2.01 of the Employer's Adoption Agreement.
1.20 "Accounting Date" is the last day of an Employer's Plan
Year. Unless otherwise specified in the Plan, the Advisory
Committee will make all Plan allocations for a particular Plan
Year as of the Accounting Date of that Plan Year.
1.21 "Trust" means the separate Trust created under the
Employer's Plan.
1.22 "Trust Fund" means all property of every kind held or
acquired by the Employer's Plan, other than incidental benefit
insurance contracts.
1.23 "Nontransferable Annuity" means an annuity which by its
terms provides that it may not be sold, assigned, discounted,
pledged as collateral for a loan or security for the performance
of an obligation or for any purpose to any person other than the
insurance company. If the Plan distributes an annuity contract,
the contract must be a Nontransferable Annuity.
1.24 "ERISA" means the Employee Retirement Income Security
Act of 1974, as amended.
1.25 "Code" means the Internal Revenue Code of 1986, as
amended.
1.26 "Service" means any period of time the Employee is in
the employ of the Employer, including any period the Employee is
on an unpaid leave of absence authorized by the Employer under a
uniform, nondiscriminatory policy applicable to all Employees.
"Separation from Service" means the Employee no longer has an
employment relationship with the Employer maintaining this Plan.
1.27 "Hour of Service" means:
(a) Each Hour of Service for which the Employer, either
directly or indirectly, pays an Employee, or for which the
Employee is entitled to payment, for the performance of duties.
The Advisory Committee credits Hours of Service under this
paragraph (a) to the Employee for the computation period in
which the Employee performs the duties, irrespective of when
paid;
(b) Each Hour of Service for back pay, irrespective of
mitigation of damages, to which the Employer has agreed or for
which the Employee has received an award. The Advisory
Committee credits Hours of Service under this paragraph (b) to
the Employee for the computation period(s) to which the award
or the agreement pertains rather than for the computation
period in which the award, agreement or payment is made; and
(c) Each Hour of Service for which the Employer, either
directly or indirectly, pays an Employee, or for which the
Employee is entitled to payment (irrespective of whether the
employment relationship is terminated), for reasons other than
for the performance of duties during a computation period, such
as leave of absence, vacation, holiday, sick leave, illness,
incapacity (including disability), layoff, jury duty or
military duty. The Advisory Committee will credit no more than
501 Hours of Service under this paragraph (c) to an Employee on
account of any single continuous period during which the
Employee does not perform any duties (whether or not such
period occurs during a single computation period). The Advisory
Committee credits Hours of Service under this paragraph (c) in
accordance with the rules of paragraphs (b) and (c) of Labor
Reg. Section 2530.200b-2, which the Plan, by this reference,
specifically incorporates in full within this paragraph (c).
The Advisory Committee will not credit an Hour of Service under
more than one of the above paragraphs. A computation period for
purposes of this Section 1.27 is the Plan Year, Year of Service
period, Break in Service period or other period, as determined
under the Plan provision for which the Advisory Committee is
measuring an Employee's Hours of Service. The Advisory Committee
will resolve any ambiguity with respect to the crediting of an
Hour of Service in favor of the Employee.
(A) Method of crediting Hours of Service. The Employer must elect
in its Adoption Agreement the method the Advisory Committee will
use in crediting an Employee with Hours of Service. For purposes
of the Plan, "actual" method means the determination of Hours of
Service from records of hours worked and hours for which the
Employer makes payment or for which payment is due from the
Employer. If the Employer elects to apply an "equivalency"
method, for each equivalency period for which the Advisory
Committee would credit the Employee with at least one Hour of
Service, the Advisory Committee will credit the Employee with:
(i) 10 Hours of Service for a daily equivalency; (ii) 45 Hours of
Service for a weekly equivalency; (iii) 95 Hours of Service for a
semimonthly payroll period equivalency; and (iv) 190 Hours of
Service for a monthly equivalency.
(B) Maternity/paternity leave. Solely for purposes of determining
whether the Employee incurs a Break in Service under any
provision of this Plan, the Advisory Committee must credit Hours
of Service during an Employee's unpaid absence period due to
maternity or paternity leave. The Advisory Committee considers an
Employee on maternity or paternity leave if the Employee's
absence is due to the Employee's pregnancy, the birth of the
Employee's child, the placement with the Employee of an adopted
child, or the care of the Employee's child immediately following
the child's birth or placement. The Advisory Committee credits
Hours of Service under this paragraph on the basis of the number
of Hours of Service the Employee would receive if he were paid
during the absence period or, if the Advisory Committee cannot
determine the number of Hours of Service the Employee would
receive, on the basis of 8 hours per day during the absence
period. The Advisory Committee will credit only the number (not
exceeding 501) of Hours of Service necessary to prevent an
Employee's Break in Service. The Advisory Committee credits all
Hours of Service described in this paragraph to the computation
period in which the absence period begins or, if the Employee
does not need these Hours of Service to prevent a Break in
Service in the computation period in which his absence period
begins, the Advisory Committee credits these Hours of Service to
the immediately following computation period.
1.28 "Disability" means the Participant, because of a
physical or mental disability, will be unable to perform the
duties of his customary position of employment (or is unable to
engage in any substantial gainful activity) for an indefinite
period which the Advisory Committee considers will be of long
continued duration. A Participant also is disabled if he incurs
the permanent loss or loss of use of a member or function of the
body, or is permanently disfigured, and incurs a Separation from
Service. The Plan considers a Participant disabled on the date
the Advisory Committee determines the Participant satisfies the
definition of disability. The Advisory Committee may require a
Participant to submit to a physical examination in order to
confirm disability. The Advisory Committee will apply the
provisions of this Section 1.28 in a nondiscriminatory,
consistent and uniform manner. If the Employer's Plan is a
Nonstandardized Plan, the Employer may provide an alternate
definition of disability in an addendum to its Adoption
Agreement, numbered Section 1.28.
1.29 SERVICE FOR PREDECESSOR EMPLOYER. If the Employer
--------------------------------
maintains the plan of a predecessor employer, the Plan treats
service of the Employee with the predecessor employer as service
with the Employer. If the Employer does not maintain the plan of
a predecessor employer, the Plan does not credit service with the
predecessor employer, unless the Employer identifies the
predecessor in its Adoption Agreement and specifies the purposes
for which the Plan will credit service with that predecessor
employer.
1.30 RELATED EMPLOYERS. A related group is a controlled
-----------------
group of corporations (as defined in Code Section 414(b)), trades
or businesses (whether or not incorporated) which are under
common control (as defined in Code Section 414(c)) or an
affiliated service group (as defined in Code Section 414(m) or in
Code Section 414(o)). If the Employer is a member of a related
group, the term "Employer" includes the related group members for
purposes of crediting Hours of Service, determining Years of
Service and Breaks in Service under Articles II and V, applying
the Participation Test and the Coverage Test under Section
3.06(E), applying the limitations on allocations in Part 2 of
Article III, applying the top heavy rules and the minimum
allocation requirements of Article III, the definitions of
Employee, Highly Compensated Employee, Compensation and Leased
Employee, and for any other purpose required by the applicable
Code section or by a Plan provision. However, an Employer may
contribute to the Plan only by being a signatory to the Execution
Page of the Adoption Agreement or to a Participation Agreement to
the Employer's Adoption Agreement. If one or more of the
Employer's related group members become Participating Employers
by executing a Participation Agreement to the Employer's Adoption
Agreement, the term "Employer" includes the participating related
group members for all purposes of the Plan, and "Plan
Administrator" means the Employer that is the signatory to the
Execution Page of the Adoption Agreement.
If the Employer's Plan is a Standardized Plan, all Employees of
the Employer or of any member of the Employer's related group,
are eligible to participate in the Plan, irrespective of whether
the related group member directly employing the Employee is a
Participating Employer. If the Employer's Plan is a
Nonstandardized Plan, the Employer must specify in Section 1.07
of its Adoption Agreement, whether the Employees of related group
members that are not Participating Employers are eligible to
participate in the Plan. Under a Nonstandardized Plan, the
Employer may elect to exclude from the definition of
"Compensation" for allocation purposes any Compensation received
from a related employer that has not executed a Participation
Agreement and whose Employees are not eligible to participate in
the Plan.
1.31 LEASED EMPLOYEES. The Plan treats a Leased Employee as
----------------
an Employee of the Employer. A Leased Employee is an individual
(who otherwise is not an Employee of the Employer) who, pursuant
to a leasing agreement between the Employer and any other person,
has performed services for the Employer (or for the Employer and
any persons related to the Employer within the meaning of Code
Section 144(a)(3)) on a substantially full time basis for at
least one year and who performs services historically performed
by employees in the Employer's business field. If a Leased
Employee is treated as an Employee by reason of this Section 1.31
of the Plan, "Compensation" includes Compensation from the
leasing organization which is attributable to services performed
for the Employer.
(A) Safe harbor plan exception. The Plan does not treat a Leased
Employee as an Employee if the leasing organization covers the
employee in a safe harbor plan and, prior to application of this
safe harbor plan exception, 20% or less of the Employer's
Employees (other than Highly Compensated Employees) are Leased
Employees. A safe harbor plan is a money purchase pension plan
providing immediate participation, full and immediate vesting,
and a nonintegrated contribution formula equal to at least 10% of
the employee's compensation without regard to employment by the
leasing organization on a specified date. The safe harbor plan
must determine the 10% contribution on the basis of compensation
as defined in Code Section 415(c)(3) plus elective contributions
(as defined in Section 1.12).
(B) Other requirements. The Advisory Committee must apply this
Section 1.31 in a manner consistent with Code Section Section
414(n) and 414(o) and the regulations issued under those Code
sections. The Employer must specify in the Adoption Agreement the
manner in which the Plan will determine the allocation of
Employer contributions and Participant forfeitures on behalf of a
Participant if the Participant is a Leased Employee covered by a
plan maintained by the leasing organization.
1.32 SPECIAL RULES FOR OWNER-EMPLOYEES. The following
---------------------------------
special provisions and restrictions apply to Owner-Employees:
(a) If the Plan provides contributions or benefits for an Owner-
Employee or for a group of Owner-Employees who controls the
trade or business with respect to which this Plan is
established and the Owner-Employee or Owner-Employees also
control as Owner-Employees one or more other trades or
businesses, plans must exist or be established with respect to
all the controlled trades or businesses so that when the plans
are combined they form a single plan which satisfies the
requirements of Code Section 401(a) and Code Section 401(d)
with respect to the employees of the controlled trades or
businesses.
(b) The Plan excludes an Owner-Employee or group of Owner-
Employees if the Owner-Employee or group of Owner-Employees
controls any other trade or business, unless the employees of
the other controlled trade or business participate in a plan
which satisfies the requirements of Code Section 401(a) and
Code Section 401(d). The other qualified plan must provide
contributions and benefits which are not less favorable than
the contributions and benefits provided for the Owner-Employee
or group of Owner-Employees under this Plan, or if an Owner-
Employee is covered under another qualified plan as an Owner-
Employee, then the plan established with respect to the trade
or business he does control must provide contributions or
benefits as favorable as those provided under the most
favorable plan of the trade or business he does not control. If
the exclusion of this paragraph (b) applies and the Employer's
Plan is a Standardized Plan, the Employer may not participate
or continue to participate in this Master Plan and the
Employer's Plan becomes an individually-designed plan for
purposes of qualification reliance.
(c) For purposes of paragraphs (a) and (b) of this Section
1.32, an Owner-Employee or group of Owner-Employees controls a
trade or business if the Owner-Employee or Owner-Employees
together (1) own the entire interest in an unincorporated trade
or business, or (2) in the case of a partnership, own more than
50% of either the capital interest or the profits interest in
the partnership.
1.33 DETERMINATION OF TOP HEAVY STATUS. If this Plan is the
---------------------------------
only qualified plan maintained by the Employer, the Plan is top
heavy for a Plan Year if the top heavy ratio as of the
Determination Date exceeds 60%. The top heavy ratio is a
fraction, the numerator of which is the sum of the present value
of Accrued Benefits of all Key Employees as of the Determination
Date and the denominator of which is a similar sum determined for
all Employees. The Advisory Committee must include in the top
heavy ratio, as part of the present value of Accrued Benefits,
any contribution not made as of the Determination Date but
includible under Code Section 416 and the applicable Treasury
regulations, and distributions made within the Determination
Period. The Advisory Committee must calculate the top heavy ratio
by disregarding the Accrued Benefit (and distributions, if any,
of the Accrued Benefit) of any Non-Key Employee who was formerly
a Key Employee, and by disregarding the Accrued Benefit
(including distributions, if any, of the Accrued Benefit) of an
individual who has not received credit for at least one Hour of
Service with the Employer during the Determination Period. The
Advisory Committee must calculate the top heavy ratio, including
the extent to which it must take into account distributions,
rollovers and transfers, in accordance with Code Section 416 and
the regulations under that Code section.
If the Employer maintains other qualified plans (including a
simplified employee pension plan), or maintained another such
plan which now is terminated, this Plan is top heavy only if it
is part of the Required Aggregation Group, and the top heavy
ratio for the Required Aggregation Group and for the Permissive
Aggregation Group, if any, each exceeds 60%. The Advisory
Committee will calculate the top heavy ratio in the same manner
as required by the first paragraph of this Section 1.33, taking
into account all plans within the Aggregation Group. To the
extent the Advisory Committee must take into account
distributions to a Participant, the Advisory Committee must
include distributions from a terminated plan which would have
been part of the Required Aggregation Group if it were in
existence on the Determination Date. The Advisory Committee will
calculate the present value of accrued benefits under defined
benefit plans or simplified employee pension plans included
within the group in accordance with the terms of those plans,
Code Section 416 and the regulations under that Code section. If
a Participant in a defined benefit plan is a Non-Key Employee,
the Advisory Committee will determine his accrued benefit under
the accrual method, if any, which is applicable uniformly to all
defined benefit plans maintained by the Employer or, if there is
no uniform method, in accordance with the slowest accrual rate
permitted under the fractional rule accrual method described in
Code Section 411(b)(1)(C). If the Employer maintains a defined
benefit plan, the Employer must specify in Adoption Agreement
Section 3.18 the actuarial assumptions (interest and mortality
only) the Advisory Committee will use to calculate the present
value of benefits from a defined benefit plan. If an aggregated
plan does not have a valuation date coinciding with the
Determination Date, the Advisory Committee must value the Accrued
Benefits in the aggregated plan as of the most recent valuation
date falling within the twelve-month period ending on the
Determination Date, except as Code Section 416 and applicable
Treasury regulations require for the first and second plan year
of a defined benefit plan. The Advisory Committee will calculate
the top heavy ratio with reference to the Determination Dates
that fall within the same calendar year.
(A) Standardized Plan. If the Employer's Plan is a Standardized
Plan, the Plan operates as a deemed top heavy plan in all Plan
Years, except, if the Standardized Plan includes a Code Section
401(k) arrangement, the Employer may elect to apply the top heavy
requirements only in Plan Years for which the Plan actually is
top heavy. Under a deemed top heavy plan, the Advisory Committee
need not determine whether the Plan actually is top heavy.
However, if the Employer, in Adoption Agreement Section 3.18,
elects to override the 100% limitation, the Advisory Committee
will need to determine whether a deemed top heavy Plan's top
heavy ratio for a Plan Year exceeds 90%.
(B) Definitions. For purposes of applying the provisions of this
Section 1.33:
(1) "Key Employee" means, as of any Determination Date, any
Employee or former Employee (or Beneficiary of such Employee)
who, for any Plan Year in the Determination Period: (i) has
Compensation in excess of 50% of the dollar amount prescribed
in Code Section 415(b)(1)(A) (relating to defined benefit
plans) and is an officer of the Employer; (ii) has Compensation
in excess of the dollar amount prescribed in Code Section
415(c)(1)(A) (relating to defined contribution plans) and is
one of the Employees owning the ten largest interests in the
Employer; (iii) is a more than 5% owner of the Employer; or
(iv) is a more than 1% owner of the Employer and has
Compensation of more than $150,000. The constructive ownership
rules of Code Section 318 (or the principles of that section,
in the case of an unincorporated Employer,) will apply to
determine ownership in the Employer. The number of officers
taken into account under clause (i) will not exceed the greater
of 3 or 10% of the total number (after application of the Code
Section 414(q) exclusions) of Employees, but no more than 50
officers. The Advisory Committee will make the determination of
who is a Key Employee in accordance with Code Section 416(i)(1)
and the regulations under that Code section.
(2) "Non-Key Employee" is an employee who does not meet the
definition of Key Employee.
(3) "Compensation" means Compensation as determined under
Section 1.09 for purposes of identifying Highly Compensated
Employees.
(4) "Required Aggregation Group" means: (i) each qualified plan
of the Employer in which at least one Key Employee participates
at any time during the Determination Period; and (ii) any other
qualified plan of the Employer which enables a plan described
in clause (i) to meet the requirements of Code Section
401(a)(4) or of Code Section 410.
(5) "Permissive Aggregation Group" is the Required Aggregation
Group plus any other qualified plans maintained by the
Employer, but only if such group would satisfy in the aggregate
the requirements of Code Section 401(a)(4) and of Code Section
410. The Advisory Committee will determine the Permissive
Aggregation Group.
(6) "Employer" means the Employer that adopts this Plan and any
related employers described in Section 1.30.
(7) "Determination Date" for any Plan Year is the Accounting
Date of the preceding Plan Year or, in the case of the first
Plan Year of the Plan, the Accounting Date of that Plan Year.
The "Determination Period" is the 5 year period ending on the
Determination Date.
1.34 "Paired Plans" means the Employer has adopted two
Standardized Plan Adoption Agreements offered with this Master
Plan, one Adoption Agreement being a Paired Profit Sharing Plan
and one Adoption Agreement being a Paired Pension Plan. A Paired
Profit Sharing Plan may include a Code Section 401(k)
arrangement. A Paired Pension Plan must be a money purchase
pension plan or a target benefit pension plan. Paired Plans must
be the subject of a favorable opinion letter issued by the
National Office of the Internal Revenue Service. This Master Plan
does not pair any of its Standardized Plan Adoption Agreements
with Standardized Plan Adoption Agreements under a defined
benefit master plan.
* * * * * * * * * * * * * * *
ARTICLE II
EMPLOYEE PARTICIPANTS
2.01 ELIGIBILITY. Each Employee becomes a Participant in the
-----------
Plan in accordance with the participation option selected by the
Employer in its Adoption Agreement. If this Plan is a restated
Plan, each Employee who was a Participant in the Plan on the day
before the Effective Date continues as a Participant in the Plan,
irrespective of whether he satisfies the participation conditions
in the restated Plan, unless otherwise provided in the Employer's
Adoption Agreement.
2.02 YEAR OF SERVICE - PARTICIPATION. For purposes of an
-------------------------------
Employee's participation in the Plan under Adoption Agreement
Section 2.01, the Plan takes into account all of his Years of
Service with the Employer, except as provided in Section 2.03.
"Year of Service" means an eligibility computation period during
which the Employee completes not less than the number of Hours of
Service specified in the Employer's Adoption Agreement. The
initial eligibility computation period is the first 12
consecutive month period measured from the Employment
Commencement Date. The Plan measures succeeding eligibility
computation periods in accordance with the option selected by the
Employer in its Adoption Agreement. If the Employer elects to
measure subsequent periods on a Plan Year basis, an Employee who
receives credit for the required number of Hours of Service
during the initial eligibility computation period and during the
first applicable Plan Year will receive credit for two Years of
Service under Article II. "Employment Commencement Date" means
the date on which the Employee first performs an Hour of Service
for the Employer. If the Employer elects a service condition
under Adoption Agreement Section 2.01 based on months, the Plan
does not apply any Hour of Service requirement after the
completion of the first Hour of Service.
2.03 BREAK IN SERVICE - PARTICIPATION. An Employee incurs a
--------------------------------
"Break in Service" if during any 12 consecutive month period he
does not complete more than 500 Hours of Service with the
Employer. The "12 consecutive month period" under this Section
2.03 is the same 12 consecutive month period for which the Plan
measures "Years of Service" under Section 2.02.
(A) 2-year Eligibility. If the Employer elects a 2 years of
service condition for eligibility purposes under Adoption
Agreement Section 2.01, the Plan treats an Employee who incurs a
one year Break in Service and who has never become a Participant
as a new Employee on the date he first performs an Hour of
Service for the Employer after the Break in Service.
(B) Suspension of Years of Service. The Employer must elect in
its Adoption Agreement whether a Participant will incur a
suspension of Years of Service after incurring a one year Break
in Service. If this rule applies under the Employer's Plan, the
Plan disregards a Participant's Years of Service (as defined in
Section 2.02) earned prior to a Break in Service until the
Participant completes another Year of Service and the Plan
suspends the Participant's participation in the Plan. If the
Participant completes a Year of Service following his Break in
Service, the Plan restores that Participant's pre-Break Years of
Service (and the Participant resumes active participation in the
Plan) retroactively to the first day of the computation period in
which the Participant earns the first post-Break Year of Service.
The initial computation period under this Section 2.03(B) is the
12 consecutive month period measured from the date the
Participant first receives credit for an Hour of Service
following the one year Break in Service period. The Plan measures
any subsequent periods, if necessary, in a manner consistent with
the computation period selection in Adoption Agreement Section
2.02. This Section 2.03(B) does not affect a Participant's
vesting credit under Article V and, during a suspension period,
the Participant's Account continues to share fully in Trust Fund
allocations under Section 9.11. Furthermore, this Section 2.03(B)
will not result in the restoration of any Year of Service
disregarded under the Break in Service rule of Section 2.03(A).
2.04 PARTICIPATION UPON RE-EMPLOYMENT. A Participant whose
--------------------------------
employment with the Employer terminates will re-enter the Plan as
a Participant on the date of his re-employment, subject to the
Break in Service rule, if applicable, under Section 2.03(B). An
Employee who satisfies the Plan's eligibility conditions but who
terminates employment with the Employer prior to becoming a
Participant will become a Participant on the later of the Plan
Entry Date on which he would have entered the Plan had he not
terminated employment or the date of his re-employment, subject
to the Break in Service rule, if applicable, under Section
2.03(B). Any Employee who terminates employment prior to
satisfying the Plan's eligibility conditions becomes a
Participant in accordance with Adoption Agreement Section 2.01.
2.05 CHANGE IN EMPLOYEE STATUS. If a Participant has not
-------------------------
incurred a Separation from Service but ceases to be eligible to
participate in the Plan, by reason of employment within an
employment classification excluded by the Employer under Adoption
Agreement Section 1.07, the Advisory Committee must treat the
Participant as an Excluded Employee during the period such a
Participant is subject to the Adoption Agreement exclusion. The
Advisory Committee determines a Participant's sharing in the
allocation of Employer contributions and Participant forfeitures,
if applicable, by disregarding his Compensation paid by the
Employer for services rendered in his capacity as an Excluded
Employee. However, during such period of exclusion, the
Participant, without regard to employment classification,
continues to receive credit for vesting under Article V for each
included Year of Service and the Participant's Account continues
to share fully in Trust Fund allocations under Section 9.11.
If an Excluded Employee who is not a Participant becomes
eligible to participate in the Plan by reason of a change in
employment classification, he will participate in the Plan
immediately if he has satisfied the eligibility conditions of
Section 2.01 and would have been a Participant had he not been an
Excluded Employee during his period of Service. Furthermore, the
Plan takes into account all of the Participant's included Years
of Service with the Employer as an Excluded Employee for purposes
of vesting credit under Article V.
2.06 ELECTION NOT TO PARTICIPATE. If the Employer's Plan is
---------------------------
a Standardized Plan, the Plan does not permit an otherwise
eligible Employee nor any Participant to elect not to participate
in the Plan. If the Employer's Plan is a Nonstandardized Plan,
the Employer must specify in its Adoption Agreement whether an
Employee eligible to participate, or any present Participant, may
elect not to participate in the Plan. For an election to be
effective for a particular Plan Year, the Employee or Participant
must file the election in writing with the Plan Administrator not
later than the time specified in the Employer's Adoption
Agreement. The Employer may not make a contribution under the
Plan for the Employee or for the Participant for the Plan Year
for which the election is effective, nor for any succeeding Plan
Year, unless the Employee or Participant re-elects to participate
in the Plan. After an Employee's or Participant's election not to
participate has been effective for at least the minimum period
prescribed by the Employer's Adoption Agreement, the Employee or
Participant may re-elect to participate in the Plan for any Plan
Year and subsequent Plan Years. An Employee or Participant may re-
elect to participate in the Plan by filing his election in
writing with the Plan Administrator not later than the time
specified in the Employer's Adoption Agreement. An Employee or
Participant who re-elects to participate may again elect not to
participate only as permitted in the Employer's Adoption
Agreement. If an Employee is a Self-Employed Individual, the
Employee's election (except as permitted by Treasury regulations
without creating a Code Section 401(k) arrangement with respect
to that Self-Employed Individual) must be effective no later than
the date the Employee first would become a Participant in the
Plan and the election is irrevocable. The Plan Administrator must
furnish an Employee or a Participant any form required for
purposes of an election under this Section 2.06. An election
timely filed is effective for the entire Plan Year.
A Participant who elects not to participate may not receive a
distribution of his Accrued Benefit attributable either to
Employer or to Participant contributions except as provided under
Article IV or under Article VI. However, for each Plan Year for
which a Participant's election not to participate is effective,
the Participant's Account, if any, continues to share in Trust
Fund allocations under Article IX. Furthermore, the Employee or
the Participant receives vesting credit under Article V for each
included Year of Service during the period the election not to
participate is effective.
* * * * * * * * * * * * * * *
ARTICLE III
EMPLOYER CONTRIBUTIONS AND FORFEITURES
Part 1. Amount of Employer Contributions and Plan Allocations:
-----------------------------------------------------
Sections 3.01 through 3.06
--------------------------
3.01 AMOUNT. For each Plan Year, the Employer contributes to
------
the Trust the amount determined by application of the
contribution option selected by the Employer in its Adoption
Agreement. The Employer may not make a contribution to the Trust
for any Plan Year to the extent the contribution would exceed the
Participants' Maximum Permissible Amounts.
The Employer contributes to this Plan on the condition its
contribution is not due to a mistake of fact and the Revenue
Service will not disallow the deduction for its contribution. The
Trustee, upon written request from the Employer, must return to
the Employer the amount of the Employer's contribution made by the
Employer by mistake of fact or the amount of the Employer's
contribution disallowed as a deduction under Code Section 404.
The Trustee will not return any portion of the Employer's
contribution under the provisions of this paragraph more than one
year after:
(a) The Employer made the contribution by mistake of fact; or
(b) The disallowance of the contribution as a deduction, and
then, only to the extent of the disallowance.
The Trustee will not increase the amount of the Employer
contribution returnable under this Section 3.01 for any earnings
attributable to the contribution, but the Trustee will decrease
the Employer contribution returnable for any losses attributable
to it. The Trustee may require the Employer to furnish it
whatever evidence the Trustee deems necessary to enable the
Trustee to confirm the amount the Employer has requested be
returned is properly returnable under ERISA.
3.02 DETERMINATION OF CONTRIBUTION. The Employer, from its
-----------------------------
records, determines the amount of any contributions to be made by
it to the Trust under the terms of the Plan.
3.03 TIME OF PAYMENT OF CONTRIBUTION. The Employer may pay
-------------------------------
its contribution for each Plan Year in one or more installments
without interest. The Employer must make its contribution to the
Plan within the time prescribed by the Code or applicable
Treasury regulations. Subject to the consent of the Trustee, the
Employer may make its contribution in property rather than in
cash, provided the contribution of property is not a prohibited
transaction under the Code or under ERISA.
3.04 CONTRIBUTION ALLOCATION.
-----------------------
(A) Method of Allocation. The Employer must specify in its
Adoption Agreement the manner of allocating each annual Employer
contribution to this Trust.
(B) Top Heavy Minimum Allocation. The Plan must comply with the
provisions of this Section 3.04(B), subject to the elections in
the Employer's Adoption Agreement.
(1) Top Heavy Minimum Allocation Under Standardized Plan.
Subject to the Employer's election under Section 3.04(B)(3), the
top heavy minimum allocation requirement applies to a
Standardized Plan for each Plan Year, irrespective of whether the
Plan is top heavy.
(a) Each Participant employed by the Employer on the
last day of the Plan Year will receive a top heavy minimum
allocation for that Plan Year. The Employer may elect in
Section 3.04 of its Adoption Agreement to apply this
paragraph (a) only to a Participant who is a Non-Key
Employee.
(b) Subject to any overriding elections in Section 3.18
of the Employer's Adoption Agreement, the top heavy minimum
allocation is the lesser of 3% of the Participant's
Compensation for the Plan Year or the highest contribution
rate for the Plan Year made on behalf of any Participant
for the Plan Year. However, if the Employee participates in
Paired Plans, the top heavy minimum allocation is 3% of his
Compensation. If, under Adoption Agreement Section 3.04,
the Employer elects to apply paragraph (a) only to a
Participant who is a Non-Key Employee, the Advisory
Committee will determine the "highest contribution rate"
described in the first sentence of this paragraph (b) by
reference only to the contribution rates of Participants
who are Key Employees for the Plan Year.
(2) Top Heavy Minimum Allocation Under Nonstandardized Plan.
The top heavy minimum allocation requirement applies to a
Nonstandardized Plan only in Plan Years for which the Plan is top
heavy. Except as provided in the Employer's Adoption Agreement,
if the Plan is top heavy in any Plan Year:
(a) Each Non-Key Employee who is a Participant and is
employed by the Employer on the last day of the Plan Year
will receive a top heavy minimum allocation for that Plan
Year, irrespective of whether he satisfies the Hours of
Service condition under Section 3.06 of the Employer's
Adoption Agreement; and
(b) The top heavy minimum allocation is the lesser of
3% of the Non-Key Employee's Compensation for the Plan Year
or the highest contribution rate for the Plan Year made on
behalf of any Key Employee. However, if a defined benefit
plan maintained by the Employer which benefits a Key
Employee depends on this Plan to satisfy the
antidiscrimination rules of Code Section 401(a)(4) or the
coverage rules of Code Section 410 (or another plan
benefiting the Key Employee so depends on such defined
benefit plan), the top heavy minimum allocation is 3% of
the Non-Key Employee's Compensation regardless of the
contribution rate for the Key Employees.
(3) Special Election for Standardized Code Section 401(k) Plan.
If the Employer's Plan is a Standardized Code Section 401(k)
Plan, the Employer may elect in Adoption Agreement Section 3.04
to apply the top heavy minimum allocation requirements of Section
3.04(B)(1) only for Plan Years in which the Plan actually is a
top heavy plan.
(4) Special Definitions. For purposes of this Section 3.04(B),
the term "Participant" includes any Employee otherwise eligible
to participate in the Plan but who is not a Participant because
of his Compensation level or because of his failure to make
elective deferrals under a Code Section 401(k) arrangement or
because of his failure to make mandatory contributions. For
purposes of subparagraph (1)(b) or (2)(b), "Compensation" means
Compensation as defined in Section 1.12, except Compensation does
not include elective contributions, irrespective of whether the
Employer has elected to include these amounts in Section 1.12 of
its Adoption Agreement, any exclusion selected in Section 1.12 of
the Adoption Agreement (other than the exclusion of elective
contributions) does not apply, and any modification to the
definition of Compensation in Section 3.06 does not apply.
(5) Determining Contribution Rates. For purposes of this
Section 3.04(B), a Participant's contribution rate is the sum of
all Employer contributions (not including Employer contributions
to Social Security) and forfeitures allocated to the
Participant's Account for the Plan Year divided by his
Compensation for the entire Plan Year. However, for purposes of
satisfying a Participant's top heavy minimum allocation in Plan
Years beginning after December 31, 1988, the Participant's
contribution rate does not include any elective contributions
under a Code Section 401(k) arrangement nor any Employer matching
contributions allocated on the basis of those elective
contributions or on the basis of employee contributions, except a
Nonstandardized Plan may include in the contribution rate any
matching contributions not necessary to satisfy the
nondiscrimination requirements of Code Section 401(k) or of Code
Section 401(m).
If the Employee is a Participant in Paired Plans, the Advisory
Committee will consider the Paired Plans as a single Plan to
determine a Participant's contribution rate and to determine
whether the Plans satisfy this top heavy minimum allocation
requirement. To determine a Participant's contribution rate under
a Nonstandardized Plan, the Advisory Committee must treat all
qualified top heavy defined contribution plans maintained by the
Employer (or by any related Employers described in Section 1.30)
as a single plan.
(6) No Allocations. If, for a Plan Year, there are no
allocations of Employer contributions or forfeitures for any
Participant (for purposes of Section 3.04 (B)(1)(b)) or for any
Key Employee (for purposes of Section 3.04(B)(2)(b)), the Plan
does not require any top heavy minimum allocation for the Plan
Year, unless a top heavy minimum allocation applies because of
the maintenance by the Employer of more than one plan.
(7) Election of Method. The Employer must specify in its
Adoption Agreement the manner in which the Plan will satisfy the
top heavy minimum allocation requirement.
(a) If the Employer elects to make any necessary additional
contribution to this Plan, the Advisory Committee first will
allocate the Employer contributions (and Participant
forfeitures, if any) for the Plan Year in accordance with the
provisions of Adoption Agreement Section 3.04. The Employer
then will contribute an additional amount for the Account of
any Participant entitled under this Section 3.04(B) to a top
heavy minimum allocation and whose contribution rate for the
Plan Year, under this Plan and any other plan aggregated under
paragraph (5), is less than the top heavy minimum allocation.
The additional amount is the amount necessary to increase the
Participant's contribution rate to the top heavy minimum
allocation. The Advisory Committee will allocate the additional
contribution to the Account of the Participant on whose behalf
the Employer makes the contribution.
(b) If the Employer elects to guarantee the top heavy minimum
allocation under another plan, this Plan does not provide the
top heavy minimum allocation and the Advisory Committee will
allocate the annual Employer contributions (and Participant
forfeitures) under the Plan solely in accordance with the
allocation method selected under Adoption Agreement Section
3.04.
3.05 FORFEITURE ALLOCATION. The amount of a Participant's
---------------------
Accrued Benefit forfeited under the Plan is a Participant
forfeiture. The Advisory Committee will allocate Participant
forfeitures in the manner specified by the Employer in its
Adoption Agreement. The Advisory Committee will continue to hold
the undistributed, non-vested portion of a terminated
Participant's Accrued Benefit in his Account solely for his
benefit until a forfeiture occurs at the time specified in
Section 5.09 or if applicable, until the time specified in
Section 9.14. Except as provided under Section 5.04, a
Participant will not share in the allocation of a forfeiture of
any portion of his Accrued Benefit.
3.06 ACCRUAL OF BENEFIT. The Advisory Committee will
------------------
determine the accrual of benefit (Employer contributions and
Participant forfeitures) on the basis of the Plan Year in
accordance with the Employer's elections in its Adoption
Agreement.
(A) Compensation Taken Into Account. The Employer must specify in
its Adoption Agreement the Compensation the Advisory Committee is
to take into account in allocating an Employer contribution to a
Participant's Account for the Plan Year in which the Employee
first becomes a Participant. For all other Plan Years, the
Advisory Committee will take into account only the Compensation
determined for the portion of the Plan Year in which the Employee
actually is a Participant. The Advisory Committee must take into
account the Employee's entire Compensation for the Plan Year to
determine whether the Plan satisfies the top heavy minimum
allocation requirement of Section 3.04(B). The Employer, in an
addendum to its Adoption Agreement numbered 3.06(A), may elect to
measure Compensation for the Plan Year for allocation purposes on
the basis of a specified period other than the Plan Year.
(B) Hours of Service Requirement. Subject to the applicable
minimum allocation requirement of Section 3.04, the Advisory
Committee will not allocate any portion of an Employer
contribution for a Plan Year to any Participant's Account if the
Participant does not complete the applicable minimum Hours of
Service requirement specified in the Employer's Adoption
Agreement.
(C) Employment Requirement. If the Employer's Plan is a
Standardized Plan, a Participant who, during a particular Plan
Year, completes the accrual requirements of Adoption Agreement
Section 3.06 will share in the allocation of Employer
contributions for that Plan Year without regard to whether he is
employed by the Employer on the Accounting Date of that Plan
Year. If the Employer's Plan is a Nonstandardized Plan, the
Employer must specify in its Adoption Agreement whether the
Participant will accrue a benefit if he is not employed by the
Employer on the Accounting Date of the Plan Year. If the
Employer's Plan is a money purchase plan or a target benefit
plan, whether Nonstandardized or Standardized, the Plan
conditions benefit accrual on employment with the Employer on the
last day of the Plan Year for the Plan Year in which the Employer
terminates the Plan.
(D) Other Requirements. If the Employer's Adoption Agreement
includes options for other requirements affecting the
Participant's accrual of benefits under the Plan, the Advisory
Committee will apply this Section 3.06 in accordance with the
Employer's Adoption Agreement selections.
(E) Suspension of Accrual Requirements Under Nonstandardized
Plan. If the Employer's Plan is a Nonstandardized Plan, the
Employer may elect in its Adoption Agreement to suspend the
accrual requirements elected under Adoption Agreement Section
3.06 if, for any Plan Year beginning after December 31, 1989, the
Plan fails to satisfy the Participation Test or the Coverage
Test. A Plan satisfies the Participation Test if, on each day of
the Plan Year, the number of Employees who benefit under the Plan
is at least equal to the lesser of 50 or 40% of the total number
of Includible Employees as of such day. A Plan satisfies the
Coverage Test if, on the last day of each quarter of the Plan
Year, the number of Nonhighly Compensated Employees who benefit
under the Plan is at least equal to 70% of the total number of
Includible Nonhighly Compensated Employees as of such day.
"Includible" Employees are all Employees other than: (1) those
Employees excluded from participating in the Plan for the entire
Plan Year by reason of the collective bargaining unit exclusion
or the nonresident alien exclusion under Adoption Agreement
Section 1.07 or by reason of the participation requirements of
Sections 2.01 and 2.03; and (2) any Employee who incurs a
Separation from Service during the Plan Year and fails to
complete at least 501 Hours of Service for the Plan Year. A
"Nonhighly Compensated Employee" is an Employee who is not a
Highly Compensated Employee and who is not a family member
aggregated with a Highly Compensated Employee pursuant to Section
1.09 of the Plan.
For purposes of the Participation Test and the Coverage Test,
an Employee is benefiting under the Plan on a particular date if,
under Adoption Agreement Section 3.04, he is entitled to an
allocation for the Plan Year. Under the Participation Test, when
determining whether an Employee is entitled to an allocation
under Adoption Agreement Section 3.04, the Advisory Committee
will disregard any allocation required solely by reason of the
top heavy minimum allocation, unless the top heavy minimum
allocation is the only allocation made under the Plan for the
Plan Year.
If this Section 3.06(E) applies for a Plan Year, the Advisory
Committee will suspend the accrual requirements for the
Includible Employees who are Participants, beginning first with
the Includible Employee(s) employed with the Employer on the last
day of the Plan Year, then the Includible Employee(s) who have
the latest Separation from Service during the Plan Year, and
continuing to suspend in descending order the accrual
requirements for each Includible Employee who incurred an earlier
Separation from Service, from the latest to the earliest
Separation from Service date, until the Plan satisfies both the
Participation Test and the Coverage Test for the Plan Year. If
two or more Includible Employees have a Separation from Service
on the same day, the Advisory Committee will suspend the accrual
requirements for all such Includible Employees, irrespective of
whether the Plan can satisfy the Participation Test and the
Coverage Test by accruing benefits for fewer than all such
Includible Employees. If the Plan suspends the accrual
requirements for an Includible Employee, that Employee will share
in the allocation of Employer contributions and Participant
forfeitures, if any, without regard to the number of Hours of
Service he has earned for the Plan Year and without regard to
whether he is employed by the Employer on the last day of the
Plan Year. If the Employer's Plan includes Employer matching
contributions subject to Code Section 401(m), this suspension of
accrual requirements applies separately to the Code Section
401(m) portion of the Plan, and the Advisory Committee will treat
an Employee as benefiting under that portion of the Plan if he is
an Eligible Employee for purposes of the Code Section 401(m)
nondiscrimination test. The Employer may modify the operation of
this Section 3.06(E) by electing appropriate modifications in
Section 3.06 of its Adoption Agreement.
Part 2. Limitations On Allocations: Sections 3.07 through 3.19
------------------------------------------------------
[Note: Sections 3.07 through 3.10 apply only to Participants in
this Plan who do not participate, and who have never
participated, in another qualified plan or in a welfare benefit
fund (as defined in Code Section 419(e)) maintained by the
Employer.]
3.07 The amount of Annual Additions which the Advisory
Committee may allocate under this Plan on a Participant's behalf
for a Limitation Year may not exceed the Maximum Permissible
Amount. If the amount the Employer otherwise would contribute to
the Participant's Account would cause the Annual Additions for
the Limitation Year to exceed the Maximum Permissible Amount, the
Employer will reduce the amount of its contribution so the Annual
Additions for the Limitation Year will equal the Maximum
Permissible Amount. If an allocation of Employer contributions,
pursuant to Section 3.04, would result in an Excess Amount (other
than an Excess Amount resulting from the circumstances described
in Section 3.10) to the Participant's Account, the Advisory
Committee will reallocate the Excess Amount to the remaining
Participants who are eligible for an allocation of Employer
contributions for the Plan Year in which the Limitation Year
ends. The Advisory Committee will make this reallocation on the
basis of the allocation method under the Plan as if the
Participant whose Account otherwise would receive the Excess
Amount is not eligible for an allocation of Employer
contributions.
3.08 Prior to the determination of the Participant's actual
Compensation for a Limitation Year, the Advisory Committee may
determine the Maximum Permissible Amount on the basis of the
Participant's estimated annual Compensation for such Limitation
Year. The Advisory Committee must make this determination on a
reasonable and uniform basis for all Participants similarly
situated. The Advisory Committee must reduce any Employer
contributions (including any allocation of forfeitures) based on
estimated annual Compensation by any Excess Amounts carried over
from prior years.
3.09 As soon as is administratively feasible after the end
of the Limitation Year, the Advisory Committee will determine the
Maximum Permissible Amount for such Limitation Year on the basis
of the Participant's actual Compensation for such Limitation
Year.
3.10 If, pursuant to Section 3.09, or because of the
allocation of forfeitures, there is an Excess Amount with respect
to a Participant for a Limitation Year, the Advisory Committee
will dispose of such Excess Amount as follows:
(a) The Advisory Committee will return any nondeductible
voluntary Employee contributions to the Participant to the
extent the return would reduce the Excess Amount.
(b) If, after the application of paragraph (a), an Excess
Amount still exists, and the Plan covers the Participant at the
end of the Limitation Year, then the Advisory Committee will
use the Excess Amount(s) to reduce future Employer
contributions (including any allocation of forfeitures) under
the Plan for the next Limitation Year and for each succeeding
Limitation Year, as is necessary, for the Participant. If the
Employer's Plan is a profit sharing plan, the Participant may
elect to limit his Compensation for allocation purposes to the
extent necessary to reduce his allocation for the Limitation
Year to the Maximum Permissible Amount and eliminate the Excess
Amount.
(c) If, after the application of paragraph (a), an Excess
Amount still exists, and the Plan does not cover the
Participant at the end of the Limitation Year, then the
Advisory Committee will hold the Excess Amount unallocated in a
suspense account. The Advisory Committee will apply the
suspense account to reduce Employer Contributions (including
allocation of forfeitures) for all remaining Participants in
the next Limitation Year, and in each succeeding Limitation
Year if necessary. Neither the Employer nor any Employee may
contribute to the Plan for any Limitation Year in which the
Plan is unable to allocate fully a suspense account maintained
pursuant to this paragraph (c).
(d) The Advisory Committee will not distribute any Excess
Amount(s) to Participants or to former Participants.
[Note: Sections 3.11 through 3.16 apply only to Participants
who, in addition to this Plan, participate in one or more plans
(including Paired Plans), all of which are qualified Master or
Prototype defined contribution plans or welfare benefit funds (as
defined in Code Section 419(e)) maintained by the Employer during
the Limitation Year.]
3.11 The amount of Annual Additions which the Advisory
Committee may allocate under this Plan on a Participant's behalf
for a Limitation Year may not exceed the Maximum Permissible
Amount, reduced by the sum of any Annual Additions allocated to
the Participant's Accounts for the same Limitation Year under
this Plan and such other defined contribution plan. If the amount
the Employer otherwise would contribute to the Participant's
Account under this Plan would cause the Annual Additions for the
Limitation Year to exceed this limitation, the Employer will
reduce the amount of its contribution so the Annual Additions
under all such plans for the Limitation Year will equal the
Maximum Permissible Amount. If an allocation of Employer
contributions, pursuant to Section 3.04, would result in an
Excess Amount (other than an Excess Amount resulting from the
circumstances described in Section 3.10) to the Participant's
Account, the Advisory Committee will reallocate the Excess Amount
to the remaining Participants who are eligible for an allocation
of Employer contributions for the Plan Year in which the
Limitation Year ends. The Advisory Committee will make this
reallocation on the basis of the allocation method under the Plan
as if the Participant whose Account otherwise would receive the
Excess Amount is not eligible for an allocation of Employer
contributions.
3.12 Prior to the determination of the Participant's actual
Compensation for the Limitation Year, the Advisory Committee may
determine the amounts referred to in 3.11 above on the basis of
the Participant's estimated annual Compensation for such
Limitation Year. The Advisory Committee will make this
determination on a reasonable and uniform basis for all
Participants similarly situated. The Advisory Committee must
reduce any Employer contribution (including allocation of
forfeitures) based on estimated annual Compensation by any Excess
Amounts carried over from prior years.
3.13 As soon as is administratively feasible after the end
of the Limitation Year, the Advisory Committee will determine the
amounts referred to in 3.11 on the basis of the Participant's
actual Compensation for such Limitation Year.
3.14 If pursuant to Section 3.13, or because of the
allocation of forfeitures, a Participant's Annual Additions under
this Plan and all such other plans result in an Excess Amount,
such Excess Amount will consist of the Amounts last allocated.
The Advisory Committee will determine the Amounts last allocated
by treating the Annual Additions attributable to a welfare
benefit fund as allocated first, irrespective of the actual
allocation date under the welfare benefit fund.
3.15 The Employer must specify in its Adoption Agreement the
Excess Amount attributed to this Plan, if the Advisory Committee
allocates an Excess Amount to a Participant on an allocation date
of this Plan which coincides with an allocation date of another
plan.
3.16 The Advisory Committee will dispose of any Excess
Amounts attributed to this Plan as provided in Section 3.10.
[Note: Section 3.17 applies only to Participants who, in
addition to this Plan, participate in one or more qualified plans
which are qualified defined contribution plans other than a
Master or Prototype plan maintained by the Employer during the
Limitation Year.]
3.17 SPECIAL ALLOCATION LIMITATION. The amount of Annual
-----------------------------
Additions which the Advisory Committee may allocate under this
Plan on behalf of any Participant are limited in accordance with
the provisions of Section 3.11 through 3.16, as though the other
plan were a Master or Prototype plan, unless the Employer
provides other limitations in an addendum to the Adoption
Agreement, numbered Section 3.17.
3.18 DEFINED BENEFIT PLAN LIMITATION. If the Employer
-------------------------------
maintains a defined benefit plan, or has ever maintained a
defined benefit plan which the Employer has terminated, then the
sum of the defined benefit plan fraction and the defined
contribution plan fraction for any Participant for any Limitation
Year must not exceed 1.0. The Employer must provide in Adoption
Agreement Section 3.18 the manner in which the Plan will satisfy
this limitation. The Employer also must provide in its Adoption
Agreement Section 3.18 the manner in which the Plan will satisfy
the top heavy requirements of Code Section 416 after taking into
account the existence (or prior maintenance) of the defined
benefit plan.
3.19 DEFINITIONS - ARTICLE III. For purposes of Article III,
-------------------------
the following terms mean:
(a) "Annual Addition" - The sum of the following amounts
allocated on behalf of a Participant for a Limitation Year, of
(i) all Employer contributions; (ii) all forfeitures; and (iii)
all Employee contributions. Except to the extent provided in
Treasury regulations, Annual Additions include excess
contributions described in Code Section 401(k), excess
aggregate contributions described in Code Section 401(m) and
excess deferrals described in Code Section 402(g), irrespective
of whether the plan distributes or forfeits such excess
amounts. Annual Additions also include Excess Amounts reapplied
to reduce Employer contributions under Section 3.10. Amounts
allocated after March 31, 1984, to an individual medical
account (as defined in Code Section 415(l)(2)) included as part
of a defined benefit plan maintained by the Employer are Annual
Additions. Furthermore, Annual Additions include contributions
paid or accrued after December 31, 1985, for taxable years
ending after December 31, 1985, attributable to post-retirement
medical benefits allocated to the separate account of a key
employee (as defined in Code Section 419A(d)(3)) under a
welfare benefit fund (as defined in Code Section 419(e))
maintained by the Employer.
(b) "Compensation" - For purposes of applying the limitations
of Part 2 of this Article III, "Compensation" means
Compensation as defined in Section 1.12, except Compensation
does not include elective contributions, irrespective of
whether the Employer has elected to include these amounts as
Compensation under Section 1.12 of its Adoption Agreement, and
any exclusion selected in Section 1.12 of the Adoption
Agreement (other than the exclusion of elective contributions)
does not apply.
(c) "Employer" - The Employer that adopts this Plan and any
related employers described in Section 1.30. Solely for
purposes of applying the limitations of Part 2 of this Article
III, the Advisory Committee will determine related employers
described in Section 1.30 by modifying Code Section Section
414(b) and (c) in accordance with Code Section 415(h).
(d) "Excess Amount" - The excess of the Participant's Annual
Additions for the Limitation Year over the Maximum Permissible
Amount.
(e) "Limitation Year" - The period selected by the Employer
under Adoption Agreement Section 1.17. All qualified plans of
the Employer must use the same Limitation Year. If the Employer
amends the Limitation Year to a different 12 consecutive month
period, the new Limitation Year must begin on a date within the
Limitation Year for which the Employer makes the amendment,
creating a short Limitation Year.
(f) "Master or Prototype Plan" - A plan the form of which is
the subject of a favorable notification letter or a favorable
opinion letter from the Internal Revenue Service.
(g) "Maximum Permissible Amount" - The lesser of (i) $30,000
(or, if greater, one-fourth of the defined benefit dollar
limitation under Code Section 415(b)(1)(A)), or (ii) 25% of the
Participant's Compensation for the Limitation Year. If there is
a short Limitation Year because of a change in Limitation Year,
the Advisory Committee will multiply the $30,000 (or adjusted)
limitation by the following fraction:
Number of months in the short Limitation Year
---------------------------------------------
12
(h) "Defined contribution plan" - A retirement plan which
provides for an individual account for each participant and for
benefits based solely on the amount contributed to the
participant's account, and any income, expenses, gains and
losses, and any forfeitures of accounts of other participants
which the plan may allocate to such participant's account. The
Advisory Committee must treat all defined contribution plans
(whether or not terminated) maintained by the Employer as a
single plan. Solely for purposes of the limitations of Part 2
of this Article III, the Advisory Committee will treat employee
contributions made to a defined benefit plan maintained by the
Employer as a separate defined contribution plan. The Advisory
Committee also will treat as a defined contribution plan an
individual medical account (as defined in Code Section
415(l)(2)) included as part of a defined benefit plan
maintained by the Employer and, for taxable years ending after
December 31, 1985, a welfare benefit fund under Code Section
419(e) maintained by the Employer to the extent there are post-
retirement medical benefits allocated to the separate account
of a key employee (as defined in Code Section 419A(d)(3)).
(i) "Defined benefit plan" - A retirement plan which does not
provide for individual accounts for Employer contributions. The
Advisory Committee must treat all defined benefit plans
(whether or not terminated) maintained by the Employer as a
single plan.
[Note: The definitions in paragraphs (j), (k) and (l) apply only
if the limitation described in Section 3.18 applies to the
Employer's Plan.]
(j) "Defined benefit plan fraction" -
Projected annual benefit of the Participant under the defined
benefit plan(s)
-------------------------------------------------------------
The lesser of (i) 125% (subject to the "100% limitation" in
paragraph (l)) of the dollar limitation in effect under Code
Section 415(b)(1)(A) for the Limitation Year,
or (ii) 140% of the Participant's average Compensation for
his high three (3) consecutive Years of Service
To determine the denominator of this fraction, the Advisory
Committee will make any adjustment required under Code Section
415(b) and will determine a Year of Service, unless otherwise
provided in an addendum to Adoption Agreement Section 3.18, as
a Plan Year in which the Employee completed at least 1,000
Hours of Service. The "projected annual benefit" is the annual
retirement benefit (adjusted to an actuarially equivalent
straight life annuity if the plan expresses such benefit in a
form other than a straight life annuity or qualified joint and
survivor annuity) of the Participant under the terms of the
defined benefit plan on the assumptions he continues employment
until his normal retirement age (or current age, if later) as
stated in the defined benefit plan, his compensation continues
at the same rate as in effect in the Limitation Year under
consideration until the date of his normal retirement age and
all other relevant factors used to determine benefits under the
defined benefit plan remain constant as of the current
Limitation Year for all future Limitation Years.
Current Accrued Benefit. If the Participant accrued
benefits in one or more defined benefit plans maintained by the
Employer which were in existence on May 6, 1986, the dollar
limitation used in the denominator of this fraction will not be
less than the Participant's Current Accrued Benefit. A
Participant's Current Accrued Benefit is the sum of the annual
benefits under such defined benefit plans which the Participant
had accrued as of the end of the 1986 Limitation Year (the last
Limitation Year beginning before January 1, 1987), determined
without regard to any change in the terms or conditions of the
Plan made after May 5, 1986, and without regard to any cost of
living adjustment occurring after May 5, 1986. This Current
Accrued Benefit rule applies only if the defined benefit plans
individually and in the aggregate satisfied the requirements of
Code Section 415 as in effect at the end of the 1986 Limitation
Year.
(k) "Defined contribution plan fraction" -
The sum, as of the close of the Limitation Year, of the
Annual Additions to the Participant's Account under the
defined contribution plan(s)
--------------------------------------------------------------
The sum of the lesser of the following amounts determined
for the Limitation Year and for each prior Year of Service with
the Employer:(i) 125% (subject to the "100% limitation" in
paragraph (l)) of the dollar limitation in effect under Code
Section 415(c)(1)(A) for the Limitation Year (determined without
regard to the special dollar limitations for employee stock
ownership plans), or (ii) 35% of the Participant's Compensation
for the Limitation Year
For purposes of determining the defined contribution plan
fraction, the Advisory Committee will not recompute Annual
Additions in Limitation Years beginning prior to January 1,
1987, to treat all Employee contributions as Annual Additions.
If the Plan satisfied Code Section 415 for Limitation Years
beginning prior to January 1, 1987, the Advisory Committee will
redetermine the defined contribution plan fraction and the
defined benefit plan fraction as of the end of the 1986
Limitation Year, in accordance with this Section 3.19. If the
sum of the redetermined fractions exceeds 1.0, the Advisory
Committee will subtract permanently from the numerator of the
defined contribution plan fraction an amount equal to the
product of (1) the excess of the sum of the fractions over 1.0,
times (2) the denominator of the defined contribution plan
fraction. In making the adjustment, the Advisory Committee must
disregard any accrued benefit under the defined benefit plan
which is in excess of the Current Accrued Benefit. This Plan
continues any transitional rules applicable to the
determination of the defined contribution plan fraction under
the Employer's Plan as of the end of the 1986 imitation Year.
(l) "100% limitation." If the 100% limitation applies, the
Advisory Committee must determine the denominator of the
defined benefit plan fraction and the denominator of the
defined contribution plan fraction by substituting 100% for
125%. If the Employer's Plan is a Standardized Plan, the 100%
limitation applies in all Limitation Years, subject to any
override provisions under Section 3.18 of the Employer's
Adoption Agreement. If the Employer overrides the 100%
limitation under a Standardized Plan, the Employer must specify
in its Adoption Agreement the manner in which the Plan
satisfies the extra minimum benefit requirement of Code Section
416(h) and the 100% limitation must continue to apply if the
Plan's top heavy ratio exceeds 90%. If the Employer's Plan is a
Nonstandardized Plan, the 100% limitation applies only if: (i)
the Plan's top heavy ratio exceeds 90%; or (ii) the Plan's top
heavy ratio is greater than 60%, and the Employer does not
elect in its Adoption Agreement Section 3.18 to provide extra
minimum benefits which satisfy Code Section 416(h)(2).
* * * * * * * * * * * * * * *
ARTICLE IV
PARTICIPANT CONTRIBUTIONS
4.01 PARTICIPANT NONDEDUCTIBLE CONTRIBUTIONS. This Plan does
---------------------------------------
not permit Participant nondeductible contributions unless the
Employer maintains its Plan under a Code Section 401(k) Adoption
Agreement. If the Employer does not maintain its Plan under a Code
Section 401(k) Adoption Agreement and, prior to the adoption of
this Master Plan, the Plan accepted Participant nondeductible
contributions for a Plan Year beginning after December 31, 1986,
those contributions must satisfy the requirements of Code Section
401(m). This Section 4.01 does not prohibit the Plan's acceptance
of Participant nondeductible contributions prior to the first
Plan Year commencing after the Plan Year in which the Employer
adopts this Master Plan.
4.02 PARTICIPANT DEDUCTIBLE CONTRIBUTIONS. A qualified Plan
------------------------------------
may not accept Participant deductible contributions after April 15,
1987. If the Employer's Plan includes Participant deductible
contributions ("DECs") made prior to April 16, 1987, the Advisory
Committee must maintain a separate accounting for the Participant's
Accrued Benefit attributable to DECs, including DECs which are part
of a rollover contribution described in Section 4.03. The Advisory
Committee will treat the accumulated DECs as part of the Participant's
Accrued Benefit for all purposes of the Plan, except for purposes of
determining the top heavy ratio under Section 1.33. The Advisory
Committee may not use DECs to purchase life insurance on the
Participant's behalf.
4.03 PARTICIPANT ROLLOVER CONTRIBUTIONS. Any Participant, with
----------------------------------
the Employer's written consent and after filing with the Trustee the
form prescribed by the Advisory Committee, may contribute cash or other
property to the Trust other than as a voluntary contribution if the
contribution is a "rollover contribution" which the Code permits an
employee to transfer either directly or indirectly from one qualified
plan to another qualified plan. Before accepting a rollover contribution,
the Trustee may require an Employee to furnish satisfactory evidence
that the proposed transfer is in fact a "rollover contribution" which
the Code permits an employee to make to a qualified plan. A rollover
contribution is not an Annual Addition under Part 2 of Article III.
The Trustee will invest the rollover contribution in a segregated
investment Account for the Participant's sole benefit unless the
Trustee (or the Named Fiduciary, in the case of a nondiscretionary
Trustee designation), in its sole discretion, agrees to invest the
rollover contribution as part of the Trust Fund. The Trustee will not
have any investment responsibility with respect to a Participant's
segregated rollover Account. The Participant, however, from time to
time, may direct the Trustee in writing as to the investment of his
segregated rollover Account in property, or property interests, of
any kind, real, personal or mixed; provided however, the Participant
may not direct the Trustee to make loans to his Employer. A Participant's
segregated rollover Account alone will bear any extraordinary expenses
resulting from investments made at the direction of the Participant. As
of the Accounting Date (or other valuation date) for each Plan Year, the
Advisory Committee will allocate and credit the net income (or net loss)
from a Participant's segregated rollover Account and the increase or
decrease in the fair market value of the assets of a segregated rollover
Account solely to that Account. The Trustee is not liable nor responsible
for any loss resulting to any Beneficiary, nor to any Participant, by
reason of any sale or investment made or other action taken pursuant to
and in accordance with the direction of the Participant. In all other
respects, the Trustee will hold, administer and distribute a rollover
contribution in the same manner as any Employer contribution made to
the Trust.
An eligible Employee, prior to satisfying the Plan's eligibility
conditions, may make a rollover contribution to the Trust to the
same extent and in the same manner as a Participant. If an Employee
makes a rollover contribution to the Trust prior to satisfying the
Plan's eligibility conditions, the Advisory Committee and Trustee
must treat the Employee as a Participant for all purposes of the
Plan except the Employee is not a Participant for purposes of
sharing in Employer contributions or Participant forfeitures under
the Plan until he actually becomes a Participant in the Plan. If
the Employee has a Separation from Service prior to becoming a
Participant, the Trustee will distribute his rollover contribution
Account to him as if it were an Employer contribution Account.
4.04 PARTICIPANT CONTRIBUTION - FORFEITABILITY. A Participant's
-----------------------------------------
Accrued Benefit is, at all times, 100% Nonforfeitable to the extent
the value of his Accrued Benefit is derived from his Participant
contributions described in this Article IV.
4.05 PARTICIPANT CONTRIBUTION - WITHDRAWAL/DISTRIBUTION. A
--------------------------------------------------
Participant, by giving prior written notice to the Trustee, may
withdraw all or any part of the value of his Accrued Benefit derived
from his Participant contributions described in this Article IV. A
distribution of Participant contributions must comply with the joint
and survivor requirements described in Article VI, if those requirements
apply to the Participant. A Participant may not exercise his right to
withdraw the value of his Accrued Benefit derived from his Participant
contributions more than once during any Plan Year. The Trustee, in
accordance with the direction of the Advisory Committee, will
distribute a Participant's unwithdrawn Accrued Benefit attributable
to his Participant contributions in accordance with the provisions
of Article VI applicable to the distribution of the Participant's
Nonforfeitable Accrued Benefit.
4.06 PARTICIPANT CONTRIBUTION - ACCRUED BENEFIT. The Advisory
------------------------------------------
Committee must maintain a separate Account(s) in the name of each
Participant to reflect the Participant's Accrued Benefit under the
Plan derived from his Participant contributions. A Participant's
Accrued Benefit derived from his Participant contributions as of
any applicable date is the balance of his separate Participant
contribution Account(s).
* * * * * * * * * * * * * * *
ARTICLE V
TERMINATION OF SERVICE - PARTICIPANT VESTING
5.01 NORMAL RETIREMENT AGE. The Employer must define Normal
---------------------
Retirement Age in its Adoption Agreement. A Participant's Accrued
Benefit derived from Employer contributions is 100% Nonforfeitable
upon and after his attaining Normal Retirement Age (if employed by
the Employer on or after that date).
5.02 PARTICIPANT DISABILITY OR DEATH. The Employer may elect
-------------------------------
in its Adoption Agreement to provide a Participant's Accrued
Benefit derived from Employer contributions will be 100%
Nonforfeitable if the Participant's Separation from Service is a
result of his death or his disability.
5.03 VESTING SCHEDULE. Except as provided in Sections 5.01
----------------
and 5.02, for each Year of Service, a Participant's Nonforfeitable
percentage of his Accrued Benefit derived from Employer contributions
equals the percentage in the vesting schedule completed by the Employer
in its Adoption Agreement.
(A) Election of Special Vesting Formula. If the Trustee makes a
distribution (other than a cash-out distribution described in
Section 5.04) to a partially-vested Participant, and the
Participant has not incurred a Forfeiture Break in Service at the
relevant time, the Advisory Committee will establish a separate
Account for the Participant's Accrued Benefit. At any relevant
time following the distribution, the Advisory Committee will
determine the Participant's Nonforfeitable Accrued Benefit
derived from Employer contributions in accordance with the
following formula: P(AB + (R x D)) - (R x D).
To apply this formula, "P" is the Participant's current vesting
percentage at the relevant time, "AB" is the Participant's
Employer-derived Accrued Benefit at the relevant time, "R" is the
ratio of "AB" to the Participant's Employer-derived Accrued
Benefit immediately following the earlier distribution and "D" is
the amount of the earlier distribution. If, under a restated
Plan, the Plan has made distribution to a partially-vested
Participant prior to its restated Effective Date and is unable to
apply the cash-out provisions of Section 5.04 to that prior
distribution, this special vesting formula also applies to that
Participant's remaining Account. The Employer, in an addendum to
its Adoption Agreement, numbered Section 5.03, may elect to
modify this formula to read as follows: P(AB + D) - D.
5.04 CASH-OUT DISTRIBUTIONS TO PARTIALLY-VESTED PARTICIPANTS/
--------------------------------------------------------
RESTORATION OF FORFEITED ACCRUED BENEFIT. If, pursuant to Article VI,
----------------------------------------
a partially-vested Participant receives a cash-out distribution before
he incurs a Forfeiture Break in Service (as defined in Section 5.08),
the cash-out distribution will result in an immediate forfeiture of
the nonvested portion of the Participant's Accrued Benefit derived
from Employer contributions. See Section 5.09. A partially-vested
Participant is a Participant whose Nonforfeitable Percentage
determined under Section 5.03 is less than 100%. A cash-out
distribution is a distribution of the entire present value of the
Participant's Nonforfeitable Accrued Benefit.
(A) Restoration and Conditions upon Restoration. A partially-
vested Participant who is re-employed by the Employer after
receiving a cash-out distribution of the Nonforfeitable
percentage of his Accrued Benefit may repay the Trustee the
amount of the cash-out distribution attributable to Employer
contributions, unless the Participant no longer has a right to
restoration by reason of the conditions of this Section 5.04(A).
If a partially-vested Participant makes the cash-out distribution
repayment, the Advisory Committee, subject to the conditions of
this Section 5.04(A), must restore his Accrued Benefit
attributable to Employer contributions to the same dollar amount
as the dollar amount of his Accrued Benefit on the Accounting
Date, or other valuation date, immediately preceding the date of
the cash-out distribution, unadjusted for any gains or losses
occurring subsequent to that Accounting Date, or other valuation
date. Restoration of the Participant's Accrued Benefit includes
restoration of all Code Section 411(d)(6) protected benefits with
respect to that restored Accrued Benefit, in accordance with
applicable Treasury regulations. The Advisory Committee will not
restore a re-employed Participant's Accrued Benefit under this
paragraph if:
(1) 5 years have elapsed since the Participant's first re-
employment date with the Employer following the cash-out
distribution; or
(2) The Participant incurred a Forfeiture Break in Service (as
defined in Section 5.08). This condition also applies if the
Participant makes repayment within the Plan Year in which he
incurs the Forfeiture Break in Service and that Forfeiture
Break in Service would result in a complete forfeiture of the
amount the Advisory Committee otherwise would restore.
(B) Time and Method of Restoration. If neither of the two
conditions preventing restoration of the Participant's Accrued
Benefit applies, the Advisory Committee will restore the
Participant's Accrued Benefit as of the Plan Year Accounting Date
coincident with or immediately following the repayment. To
restore the Participant's Accrued Benefit, the Advisory
Committee, to the extent necessary, will allocate to the
Participant's Account:
(1) First, the amount, if any, of Participant forfeitures the
Advisory Committee would otherwise allocate under Section 3.05;
(2) Second, the amount, if any, of the Trust Fund net income or
gain for the Plan Year; and
(3) Third, the Employer contribution for the Plan Year to the
extent made under a discretionary formula.
In an addendum to its Adoption Agreement numbered 5.04(B), the
Employer may eliminate as a means of restoration any of the
amounts described in clauses (1), (2) and (3) or may change the
order of priority of these amounts. To the extent the amounts
described in clauses (1), (2) and (3) are insufficient to enable
the Advisory Committee to make the required restoration, the
Employer must contribute, without regard to any requirement or
condition of Section 3.01, the additional amount necessary to
enable the Advisory Committee to make the required restoration.
If, for a particular Plan Year, the Advisory Committee must
restore the Accrued Benefit of more than one re-employed
Participant, then the Advisory Committee will make the
restoration allocations to each such Participant's Account in the
same proportion that a Participant's restored amount for the Plan
Year bears to the restored amount for the Plan Year of all
re-employed Participants. The Advisory Committee will not take
into account any allocation under this Section 5.04 in applying
the limitation on allocations under Part 2 of Article III.
(C) 0% Vested Participant. The Employer must specify in its
Adoption Agreement whether the deemed cash-out rule applies to a
0% vested Participant. A 0% vested Participant is a Participant
whose Accrued Benefit derived from Employer contributions is
entirely forfeitable at the time of his Separation from Service.
If the Participant's Account is not entitled to an allocation of
Employer contributions for the Plan Year in which he has a
Separation from Service, the Advisory Committee will apply the
deemed cash-out rule as if the 0% vested Participant received a
cash-out distribution on the date of the Participant's Separation
from Service. If the Participant's Account is entitled to an
allocation of Employer contributions or Participant forfeitures
for the Plan Year in which he has a Separation from Service, the
Advisory Committee will apply the deemed cash-out rule as if the
0% vested Participant received a cash-out distribution on the first
day of the first Plan Year beginning after his Separation from Service.
For purposes of applying the restoration provisions of this Section
5.04, the Advisory Committee will treat the 0% vested Participant as
repaying his cash-out "distribution" on the first date of his re-
employment with the Employer. If the deemed cash-out rule does not
apply to the Employer's Plan, a 0% vested Participant will not incur
a forfeiture until he incurs a Forfeiture Break in Service.
5.05 SEGREGATED ACCOUNT FOR REPAID AMOUNT. Until the Advisory
------------------------------------
Committee restores the Participant's Accrued Benefit, as described
in Section 5.04, the Trustee will invest the cash-out amount the
Participant has repaid in a segregated Account maintained solely for
that Participant. The Trustee must invest the amount in the Participant's
segregated Account in Federally insured interest bearing savings
account(s) or time deposit(s) (or a combination of both), or in other
fixed income investments. Until commingled with the balance of the
Trust Fund on the date the Advisory Committee restores the Participant's
Accrued Benefit, the Participant's segregated Account remains a part
of the Trust, but it alone shares in any income it earns and it alone
bears any expense or loss it incurs. Unless the repayment qualifies as
a rollover contribution, the Advisory Committee will direct the Trustee
to repay to the Participant as soon as is administratively practicable
the full amount of the Participant's segregated Account if the Advisory
Committee determines either of the conditions of Section 5.04(A) prevents
restoration as of the applicable Accounting Date, notwithstanding the
Participant's repayment.
5.06 YEAR OF SERVICE - VESTING. For purposes of vesting under
-------------------------
Section 5.03, Year of Service means any 12-consecutive month period
designated in the Employer's Adoption Agreement during which an Employee
completes not less than the number of Hours of Service (not exceeding
1,000) specified in the Employer's Adoption Agreement. A Year of Service
includes any Year of Service earned prior to the Effective Date of the
Plan, except as provided in Section 5.08.
5.07 BREAK IN SERVICE - VESTING. For purposes of this Article V, a
--------------------------
Participant incurs a "Break in Service" if during any vesting computation
period he does not complete more than 500 Hours of Service. If, pursuant
to Section 5.06, the Plan does not require more than 500 Hours of Service
to receive credit for a Year of Service, a Participant incurs a Break in
Service in a vesting computation period in which he fails to complete a
Year of Service.
5.08 INCLUDED YEARS OF SERVICE - VESTING. For purposes of determining
-----------------------------------
"Years of Service" under Section 5.06, the Plan takes into account all
Years of Service an Employee completes with the Employer except:
(a) For the sole purpose of determining a Participant's Nonforfeitable
percentage of his Accrued Benefit derived from Employer contributions
which accrued for his benefit prior to a Forfeiture Break in Service,
the Plan disregards any Year of Service after the Participant first
incurs a Forfeiture Break in Service. The Participant incurs a
Forfeiture Break in Service when he incurs 5 consecutive Breaks in
Service.
(b) The Plan disregards any Year of Service excluded under the
Employer's Adoption Agreement.
The Plan does not apply the Break in Service rule under Code Section
411(a)(6)(B). Therefore, an Employee need not complete a Year of Service
after a Break in Service before the Plan takes into account the Employee's
otherwise includible Years of Service under this Article V.
5.09 FORFEITURE OCCURS. A Participant's forfeiture, if any, of his
-----------------
Accrued Benefit derived from Employer contributions occurs under the Plan
on the earlier of:
(a) The last day of the vesting computation period in which the
Participant first incurs a Forfeiture Break in Service; or
(b) The date the Participant receives a cash-out distribution.
The Advisory Committee determines the percentage of a Participant's
Accrued Benefit forfeiture, if any, under this Section 5.09 solely by
reference to the vesting schedule of Section 5.03. A Participant does
not forfeit any portion of his Accrued Benefit for any other reason or
cause except as expressly provided by this Section 5.09 or as provided
under Section 9.14.
* * * * * * * * * * * * * * *
ARTICLE VI
TIME AND METHOD OF PAYMENT OF BENEFITS
6.01 TIME OF PAYMENT OF ACCRUED BENEFIT. Unless, pursuant to
----------------------------------
Section 6.03, the Participant or the Beneficiary elects in writing
to a different time or method of payment, the Advisory Committee
will direct the Trustee to commence distribution of a Participant's
Nonforfeitable Accrued Benefit in accordance with this Section 6.01.
A Participant must consent, in writing, to any distribution required
under this Section 6.01 if the present value of the Participant's
Nonforfeitable Accrued Benefit, at the time of the distribution to
the Participant, exceeds $3,500 and the Participant has not attained
the later of Normal Retirement Age or age 62. Furthermore, the
Participant's spouse also must consent, in writing, to any
distribution, for which Section 6.04 requires the spouse's consent.
For all purposes of this Article VI, the term "annuity starting date"
means the first day of the first period for which the Plan pays an
amount as an annuity or in any other form. A distribution date under
this Article VI, unless otherwise specified within the Plan, is the
date or dates the Employer specifies in the Adoption Agreement, or
as soon as administratively practicable following that distribution
date. For purposes of the consent requirements under this Article VI,
if the present value of the Participant's Nonforfeitable Accrued
Benefit, at the time of any distribution, exceeds $3,500, the
Advisory Committee must treat that present value as exceeding
$3,500 for purposes of all subsequent Plan distributions to the
Participant.
(A) Separation from Service For a Reason Other Than Death.
(1) Participant's Nonforfeitable Accrued Benefit Not Exceeding
$3,500. If the Participant's Separation from Service is for any
reason other than death, the Advisory Committee will direct the
Trustee to distribute the Participant's Nonforfeitable Accrued
Benefit in a lump sum, on the distribution date the Employer
specifies in the Adoption Agreement, but in no event later than
the 60th day following the close of the Plan Year in which the
Participant attains Normal Retirement Age. If the Participant has
attained Normal Retirement Age at the time of his Separation from
Service, the distribution under this paragraph will occur no
later than the 60th day following the close of the Plan Year in
which the Participant's Separation from Service occurs.
(2) Participant's Nonforfeitable Accrued Benefit Exceeds
$3,500. If the Participant's Separation from Service is for any
reason other than death, the Advisory Committee will direct the
Trustee to commence distribution of the Participant's
Nonforfeitable Accrued Benefit in a form and at the time elected
by the Participant, pursuant to Section 6.03. In the absence of
an election by the Participant, the Advisory Committee will
direct the Trustee to distribute the Participant's Nonforfeitable
Accrued Benefit in a lump sum (or, if applicable, the normal
annuity form of distribution required under Section 6.04), on the
60th day following the close of the Plan Year in which the latest
of the following events occurs: (a) the Participant attains
Normal Retirement Age; (b) the Participant attains age 62; or (c)
the Participant's Separation from Service.
(3) Disability. If the Participant's Separation from Service is
because of his disability, the Advisory Committee will direct the
Trustee to pay the Participant's Nonforfeitable Accrued Benefit
in lump sum, on the distribution date the Employer specifies in
the Adoption Agreement, subject to the notice and consent
requirements of this Article VI and subject to the applicable
mandatory commencement dates described in Paragraphs (1) and (2).
(4) Hardship. Prior to the time at which the Participant may
receive distribution under Paragraphs (1), (2) or (3), the
Participant may request a distribution from his Nonforfeitable
Accrued Benefit in an amount necessary to satisfy a hardship, if
the Employer elects in the Adoption Agreement to permit hardship
distributions. Unless the Employer elects otherwise in the
Adoption Agreement, a hardship distribution must be on account of
any of the following: (a) medical expenses; (b) the purchase
(excluding mortgage payments) of the Participant's principal
residence; (c) post-secondary education tuition, for the next
semester or quarter, for the Participant or for the Participant's
spouse, children or dependents; (d) to prevent the eviction of
the Participant from his principal residence or the foreclosure
on the mortgage of the Participant's principal residence; (e)
funeral expenses of the Participant's family member; or (f) the
Participant's disability. A partially-vested Participant may not
receive a hardship distribution described in this Paragraph
(A)(4) prior to incurring a Forfeiture Break in Service, unless
the hardship distribution is a cash-out distribution (as defined
in Article V). The Advisory Committee will direct the Trustee to
make the hardship distribution as soon as administratively
practicable after the Participant makes a valid request for the
hardship distribution.
(B) Required Beginning Date. If any distribution commencement
date described under Paragraph (A) of this Section 6.01, either
by Plan provision or by Participant election (or nonelection), is
later than the Participant's Required Beginning Date, the
Advisory Committee instead must direct the Trustee to make
distribution on the Participant's Required Beginning Date,
subject to the transitional election, if applicable, under
Section 6.03(D). A Participant's Required Beginning Date is the
April 1 following the close of the calendar year in which the
Participant attains age 70 1/2. However, if the Participant, prior
to incurring a Separation from Service, attained age 70 1/2 by
January 1, 1988, and, for the five Plan Year period ending in the
calendar year in which he attained age 70 1/2 and for all subsequent
years, the Participant was not a more than 5% owner, the Required
Beginning Date is the April 1 following the close of the calendar
year in which the Participant separates from Service or, if
earlier, the April 1 following the close of the calendar year in
which the Participant becomes a more than 5% owner. Furthermore,
if a Participant who was not a more than 5% owner attained age
70 1/2 during 1988 and did not incur a Separation from Service prior
to January 1, 1989, his Required Beginning Date is April 1, 1990.
A mandatory distribution at the Participant's Required Beginning
Date will be in lump sum (or, if applicable, the normal annuity
form of distribution required under Section 6.04) unless the
Participant, pursuant to the provisions of this Article VI, makes
a valid election to receive an alternative form of payment.
(C) Death of the Participant. The Advisory Committee will direct
the Trustee, in accordance with this Section 6.01(C), to
distribute to the Participant's Beneficiary the Participant's
Nonforfeitable Accrued Benefit remaining in the Trust at the time
of the Participant's death. Subject to the requirements of
Section 6.04, the Advisory Committee will determine the death
benefit by reducing the Participant's Nonforfeitable Accrued
Benefit by any security interest the Plan has against that
Nonforfeitable Accrued Benefit by reason of an outstanding
Participant loan.
(1) Deceased Participant's Nonforfeitable Accrued Benefit Does
Not Exceed $3,500. The Advisory Committee, subject to the
requirements of Section 6.04, must direct the Trustee to
distribute the deceased Participant's Nonforfeitable Accrued
Benefit in a single sum, as soon as administratively practicable
following the Participant's death or, if later, the date on which
the Advisory Committee receives notification of or otherwise
confirms the Participant's death.
(2) Deceased Participant's Nonforfeitable Accrued Benefit
Exceeds $3,500. The Advisory Committee will direct the Trustee to
distribute the deceased Participant's Nonforfeitable Accrued
Benefit at the time and in the form elected by the Participant
or, if applicable by the Beneficiary, as permitted under this
Article VI. In the absence of an election, subject to the
requirements of Section 6.04, the Advisory Committee will direct
the Trustee to distribute the Participant's undistributed
Nonforfeitable Accrued Benefit in a lump sum on the first
distribution date following the close of the Plan Year in which
the Participant's death occurs or, if later, the first
distribution date following the date the Advisory Committee
receives notification of or otherwise confirms the Participant's
death.
If the death benefit is payable in full to the Participant's
surviving spouse, the surviving spouse, in addition to the
distribution options provided in this Section 6.01(C), may elect
distribution at any time or in any form (other than a joint and
survivor annuity) this Article VI would permit for a Participant.
6.02 METHOD OF PAYMENT OF ACCRUED BENEFIT. Subject to the
------------------------------------
annuity distribution requirements, if any, prescribed by Section
6.04, and any restrictions prescribed by Section 6.03, a
Participant or Beneficiary may elect distribution under one, or
any combination, of the following methods: (a) by payment in a
lump sum; or (b) by payment in monthly, quarterly or annual
installments over a fixed reasonable period of time, not
exceeding the life expectancy of the Participant, or the joint
life and last survivor expectancy of the Participant and his
Beneficiary. The Employer may elect in its Adoption Agreement to
modify the methods of payment available under this Section 6.02.
The distribution options permitted under this Section 6.02 are
available only if the present value of the Participant
Nonforfeitable Accrued Benefit, at the time of the distribution
to the Participant, exceeds $3,500. To facilitate installment
payments under this Article VI, the Advisory Committee may direct
the Trustee to segregate all or any part of the Participant's
Accrued Benefit in a separate Account. The Trustee will invest
the Participant's segregated Account in Federally insured
interest bearing savings account(s) or time deposit(s) (or a
combination of both), or in other fixed income investments. A
segregated Account remains a part of the Trust, but it alone
shares in any income it earns, and it alone bears any expense or
loss it incurs. A Participant or Beneficiary may elect to receive
an installment distribution in the form of a Nontransferable
Annuity Contract. Under an installment distribution, the
Participant or Beneficiary, at any time, may elect to accelerate
the payment of all, or any portion, of the Participant's unpaid
Nonforfeitable Accrued Benefit, subject to the requirements of
Section 6.04.
(A) Minimum Distribution Requirements for Participants. The
Advisory Committee may not direct the Trustee to distribute the
Participant's Nonforfeitable Accrued Benefit, nor may the
Participant elect to have the Trustee distribute his
Nonforfeitable Accrued Benefit, under a method of payment which,
as of the Required Beginning Date, does not satisfy the minimum
distribution requirements under Code Section 401(a)(9) and the
applicable Treasury regulations. The minimum distribution for a
calendar year equals the Participant's Nonforfeitable Accrued
Benefit as of the latest valuation date preceding the beginning
of the calendar year divided by the Participant's life expectancy
or, if applicable, the joint and last survivor expectancy of the
Participant and his designated Beneficiary (as determined under
Article VIII, subject to the requirements of the Code Section
401(a)(9) regulations). The Advisory Committee will increase the
Participant's Nonforfeitable Accrued Benefit, as determined on
the relevant valuation date, for contributions or forfeitures
allocated after the valuation date and by December 31 of the
valuation calendar year, and will decrease the valuation by
distributions made after the valuation date and by December 31 of
the valuation calendar year. For purposes of this valuation, the
Advisory Committee will treat any portion of the minimum
distribution for the first distribution calendar year made after
the close of that year as a distribution occurring in that first
distribution calendar year. In computing a minimum distribution,
the Advisory Committee must use the unisex life expectancy
multiples under Treas. Reg. Section 1.72-9. The Advisory
Committee, only upon the Participant's written request, will
compute the minimum distribution for a calendar year subsequent
to the first calendar year for which the Plan requires a minimum
distribution by redetermining the applicable life expectancy.
However, the Advisory Committee may not redetermine the joint
life and last survivor expectancy of the Participant and a
nonspouse designated Beneficiary in a manner which takes into
account any adjustment to a life expectancy other than the
Participant's life expectancy.
If the Participant's spouse is not his designated Beneficiary,
a method of payment to the Participant (whether by Participant
election or by Advisory Committee direction) may not provide more
than incidental benefits to the Beneficiary. For Plan Years
beginning after December 31, 1988, the Plan must satisfy the
minimum distribution incidental benefit ("MDIB") requirement in
the Treasury regulations issued under Code Section 401(a)(9) for
distributions made on or after the Participant's Required
Beginning Date and before the Participant's death. To satisfy the
MDIB requirement, the Advisory Committee will compute the minimum
distribution required by this Section 6.02(A) by substituting the
applicable MDIB divisor for the applicable life expectancy
factor, if the MDIB divisor is a lesser number. Following the
Participant's death, the Advisory Committee will compute the
minimum distribution required by this Section 6.02(A) solely on
the basis of the applicable life expectancy factor and will
disregard the MDIB factor. For Plan Years beginning prior to
January 1, 1989, the Plan satisfies the incidental benefits
requirement if the distributions to the Participant satisfied the
MDIB requirement or if the present value of the retirement
benefits payable solely to the Participant is greater than 50% of
the present value of the total benefits payable to the
Participant and his Beneficiaries. The Advisory Committee must
determine whether benefits to the Beneficiary are incidental as
of the date the Trustee is to commence payment of the retirement
benefits to the Participant, or as of any date the Trustee
redetermines the payment period to the Participant.
The minimum distribution for the first distribution calendar
year is due by the Participant's Required Beginning Date. The
minimum distribution for each subsequent distribution calendar
year, including the calendar year in which the Participant's
Required Beginning Date occurs, is due by December 31 of that
year. If the Participant receives distribution in the form of a
Nontransferable Annuity Contract, the distribution satisfies this
Section 6.02(A) if the contract complies with the requirements of
Code Section 401(a)(9) and the applicable Treasury regulations.
(B) Minimum Distribution Requirements for Beneficiaries. The
method of distribution to the Participant's Beneficiary must
satisfy Code Section 401(a)(9) and the applicable Treasury
regulations. If the Participant's death occurs after his Required
Beginning Date or, if earlier, the date the Participant commences
an irrevocable annuity pursuant to Section 6.04, the method of
payment to the Beneficiary must provide for completion of payment
over a period which does not exceed the payment period which had
commenced for the Participant. If the Participant's death occurs
prior to his Required Beginning Date, and the Participant had not
commenced an irrevocable annuity pursuant to Section 6.04, the
method of payment to the Beneficiary, subject to Section 6.04,
must provide for completion of payment to the Beneficiary over a
period not exceeding: (i) 5 years after the date of the
Participant's death; or (ii) if the Beneficiary is a designated
Beneficiary, the designated Beneficiary's life expectancy. The
Advisory Committee may not direct payment of the Participant's
Nonforfeitable Accrued Benefit over a period described in clause
(ii) unless the Trustee will commence payment to the designated
Beneficiary no later than the December 31 following the close of
the calendar year in which the Participant's death occurred or,
if later, and the designated Beneficiary is the Participant's
surviving spouse, December 31 of the calendar year in which the
Participant would have attained age 70 1/2. If the Trustee will make
distribution in accordance with clause (ii), the minimum
distribution for a calendar year equals the Participant's
Nonforfeitable Accrued Benefit as of the latest valuation date
preceding the beginning of the calendar year divided by the
designated Beneficiary's life expectancy. The Advisory Committee
must use the unisex life expectancy multiples under Treas. Reg.
Section 1.72-9 for purposes of applying this paragraph. The
Advisory Committee, only upon the written request of the
Participant or of the Participant's surviving spouse, will
recalculate the life expectancy of the Participant's surviving
spouse not more frequently than annually, but may not recalculate
the life expectancy of a nonspouse designated Beneficiary after
the Trustee commences payment to the designated Beneficiary. The
Advisory Committee will apply this paragraph by treating any
amount paid to the Participant's child, which becomes payable to
the Participant's surviving spouse upon the child's attaining the
age of majority, as paid to the Participant's surviving spouse.
Upon the Beneficiary's written request, the Advisory Committee
must direct the Trustee to accelerate payment of all, or any
portion, of the Participant's unpaid Accrued Benefit, as soon as
administratively practicable following the effective date of that
request.
6.03 BENEFIT PAYMENT ELECTIONS. Not earlier than 90 days,
-------------------------
but not later than 30 days, before the Participant's annuity
starting date, the Advisory Committee must provide a benefit
notice to a Participant who is eligible to make an election under
this Section 6.03. The benefit notice must explain the optional
forms of benefit in the Plan, including the material features and
relative values of those options, and the Participant's right to
defer distribution until he attains the later of Normal
Retirement Age or age 62.
If a Participant or Beneficiary makes an election prescribed by
this Section 6.03, the Advisory Committee will direct the Trustee
to distribute the Participant's Nonforfeitable Accrued Benefit in
accordance with that election. Any election under this Section
6.03 is subject to the requirements of Section 6.02 and of
Section 6.04. The Participant or Beneficiary must make an
election under this Section 6.03 by filing his election with the
Advisory Committee at any time before the Trustee otherwise would
commence to pay a Participant's Accrued Benefit in accordance
with the requirements of Article VI.
(A) Participant Elections After Separation from Service. If the
present value of a Participant's Nonforfeitable Accrued Benefit
exceeds $3,500, he may elect to have the Trustee commence
distribution as of any distribution date permitted under the
Employer's Adoption Agreement Section 6.03. The Participant may
reconsider an election at any time prior to the annuity starting
date and elect to commence distribution as of any other
distribution date permitted under the Employer's Adoption
Agreement Section 6.03. If the Participant is partially-vested in
his Accrued Benefit, an election under this Paragraph (A) to
distribute prior to the Participant's incurring a Forfeiture
Break in Service (as defined in Section 5.08), must be in the
form of a cash-out distribution (as defined in Article V). A
Participant may not receive a cash-out distribution if, prior to
the time the Trustee actually makes the cash-out distribution,
the Participant returns to employment with the Employer.
Following his attainment of Normal Retirement Age, a Participant
who has separated from Service may elect distribution as of any
distribution date, irrespective of the elections under Adoption
Agreement Section 6.03.
(B) Participant Elections Prior to Separation from Service. The
Employer must specify in its Adoption Agreement the distribution
election rights, if any, a Participant has prior to his Separation
from Service. A Participant must make an election under this
Section 6.03(B) on a form prescribed by the Advisory Committee at
any time during the Plan Year for which his election is to be
effective. In his written election, the Participant must specify the
percentage or dollar amount he wishes the Trustee to distribute to
him. The Participant's election relates solely to the percentage
or dollar amount specified in his election form and his right to
elect to receive an amount, if any, for a particular Plan Year
greater than the dollar amount or percentage specified in his
election form terminates on the Accounting Date. The Trustee must
make a distribution to a Participant in accordance with his
election under this Section 6.03(B) within the 90 day period (or
as soon as administratively practicable) after the Participant
files his written election with the Trustee. The Trustee will
distribute the balance of the Participant's Accrued Benefit not
distributed pursuant to his election(s) in accordance with the
other distribution provisions of this Plan.
(C) Death Benefit Elections. If the present value of the deceased
Participant's Nonforfeitable Accrued Benefit exceeds $3,500, the
Participant's Beneficiary may elect to have the Trustee distribute
the Participant's Nonforfeitable Accrued Benefit in a form and
within a period permitted under Section 6.02. The Beneficiary's
election is subject to any restrictions designated in writing
by the Participant and not revoked as of his date of death.
(D) Transitional Elections. Notwithstanding the provisions of
Sections 6.01 and 6.02, if the Participant (or Beneficiary)
signed a written distribution designation prior to January 1,
1984, the Advisory Committee must distribute the Participant's
Nonforfeitable Accrued Benefit in accordance with that
designation, subject however, to the survivor requirements, if
applicable, of Sections 6.04, 6.05 and 6.06. This Section 6.03(D)
does not apply to a pre-1984 distribution designation, and the
Advisory Committee will not comply with that designation, if any
of the following applies: (1) the method of distribution would have
disqualified the Plan under Code Section 401(a)(9) as in effect on
December 31, 1983; (2) the Participant did not have an Accrued
Benefit as of December 31, 1983; (3) the distribution designation
does not specify the timing and form of the distribution and the
death Beneficiaries (in order of priority); (4) the substitution
of a Beneficiary modifies the payment period of the distribution;
or, (5) the Participant (or Beneficiary) modifies or revokes the
distribution designation. In the event of a revocation, the Plan
must distribute, no later than December 31 of the calendar year
following the year of revocation, the amount which the Participant
would have received under Section 6.02(A) if the distribution
designation had not been in effect or, if the Beneficiary revokes
the distribution designation, the amount which the Beneficiary
would have received under Section 6.02(B) if the distribution
designation had not been in effect. The Advisory Committee will
apply this Section 6.03(D) to rollovers and transfers in accordance
with Part J of the Code Section 401(a)(9) Treasury regulations.
6.04 ANNUITY DISTRIBUTIONS TO PARTICIPANTS AND SURVIVING SPOUSES.
-----------------------------------------------------------
(A) Joint and Survivor Annuity. The Advisory Committee must direct
the Trustee to distribute a married or unmarried Participant's
Nonforfeitable Accrued Benefit in the form of a qualified joint and
survivor annuity, unless the Participant makes a valid waiver election
(described in Section 6.05) within the 90 day period ending on the
annuity starting date. If, as of the annuity starting date, the
Participant is married, a qualified joint and survivor annuity is an
immediate annuity which is purchasable with the Participant's
Nonforfeitable Accrued Benefit and which provides a life annuity
for the Participant and a survivor annuity payable for the remaining
life of the Participant's surviving spouse equal to 50% of the amount
of the annuity payable during the life of the Participant. If, as of
the annuity starting date, the Participant is not married, a qualified
joint and survivor annuity is an immediate life annuity for the
Participant which is purchasable with the Participant's Nonforfeitable
Accrued Benefit. On or before the annuity starting date, the Advisory
Committee, without Participant or spousal consent, must direct the
Trustee to pay the Participant's Nonforfeitable Accrued Benefit in
a lump sum, in lieu of a qualified joint and survivor annuity, in
accordance with Section 6.01, if the Participant's Nonforfeitable
Accrued Benefit is not greater than $3,500. This Section 6.04(A)
applies only to a Participant who has completed at least one Hour
of Service with the Employer after August 22, 1984.
(B) Preretirement Survivor Annuity. If a married Participant dies
prior to his annuity starting date, the Advisory Committee will
direct the Trustee to distribute a portion of the Participant's
Nonforfeitable Accrued Benefit to the Participant's surviving
spouse in the form of a preretirement survivor annuity, unless
the Participant has a valid waiver election (as described in
Section 6.06) in effect, or unless the Participant and his spouse
were not married throughout the one year period ending on the
date of his death. A preretirement survivor annuity is an annuity
which is purchasable with 50% of the Participant's Nonforfeitable
Accrued Benefit (determined as of the date of the Participant's
death) and which is payable for the life of the Participant's
surviving spouse. The value of the preretirement survivor annuity
is attributable to Employer contributions and to Employee
contributions in the same proportion as the Participant's
Nonforfeitable Accrued Benefit is attributable to those
contributions. The portion of the Participant's Nonforfeitable
Accrued Benefit not payable under this paragraph is payable to
the Participant's Beneficiary, in accordance with the other
provisions of this Article VI. If the present value of the
preretirement survivor annuity does not exceed $3,500, the
Advisory Committee, on or before the annuity starting date, must
direct the Trustee to make a lump sum distribution to the
Participant's surviving spouse, in lieu of a preretirement
survivor annuity. This Section 6.04(B) applies only to a
Participant who dies after August 22, 1984, and either (i)
completes at least one Hour of Service with the Employer after
August 22, 1984, or (ii) separated from Service with at least 10
Years of Service (as defined in Section 5.06) and completed at
least one Hour of Service with the Employer in a Plan Year
beginning after December 31, 1975.
(C) Surviving Spouse Elections. If the present value of the
preretirement survivor annuity exceeds $3,500, the Participant's
surviving spouse may elect to have the Trustee commence payment
of the preretirement survivor annuity at any time following the
date of the Participant's death, but not later than the mandatory
distribution periods described in Section 6.02, and may elect any
of the forms of payment described in Section 6.02, in lieu of the
preretirement survivor annuity. In the absence of an election by
the surviving spouse, the Advisory Committee must direct the
Trustee to distribute the preretirement survivor annuity on the
first distribution date following the close of the Plan Year in
which the latest of the following events occurs: (i) the
Participant's death; (ii) the date the Advisory Committee
receives notification of or otherwise confirms the Participant's
death; (iii) the date the Participant would have attained Normal
Retirement Age; or (iv) the date the Participant would have
attained age 62.
(D) Special Rules. If the Participant has in effect a valid
waiver election regarding the qualified joint and survivor
annuity or the preretirement survivor annuity, the Advisory
Committee must direct the Trustee to distribute the Participant's
Nonforfeitable Accrued Benefit in accordance with Sections 6.01,
6.02 and 6.03. The Advisory Committee will reduce the
Participant's Nonforfeitable Accrued Benefit by any security
interest (pursuant to any offset rights authorized by Section
10.03[E]) held by the Plan by reason of a Participant loan to
determine the value of the Participant's Nonforfeitable Accrued
Benefit distributable in the form of a qualified joint and
survivor annuity or preretirement survivor annuity, provided any
post-August 18, 1985, loan satisfied the spousal consent
requirement described in Section 10.03[E] of the Plan. For
purposes of applying this Article VI, the Advisory Committee
treats a former spouse as the Participant's spouse or surviving
spouse to the extent provided under a qualified domestic
relations order described in Section 6.07. The provisions of this
Section 6.04, and of Sections 6.05 and 6.06, apply separately to
the portion of the Participant's Nonforfeitable Accrued Benefit
subject to the qualified domestic relations order and to the
portion of the Participant's Nonforfeitable Accrued Benefit not
subject to that order.
(E) Profit Sharing Plan Election. If this Plan is a profit
sharing plan, the Employer must elect the extent to which the
preceding provisions of Section 6.04 apply. If the Employer
elects to apply this Section 6.04 only to a Participant described
in this Section 6.04(E), the preceding provisions of this Section
6.04 apply only to the following Participants: (1) a Participant
as respects whom the Plan is a direct or indirect transferee from
a plan subject to the Code Section 417 requirements and the Plan
received the transfer after December 31, 1984, unless the
transfer is an elective transfer described in Section 13.06; (2)
a Participant who elects a life annuity distribution (if Section
6.02 or Section 13.02 of the Plan requires the Plan to provide a
life annuity distribution option); and (3) a Participant whose
benefits under a defined benefit plan maintained by the Employer
are offset by benefits provided under this Plan. If the Employer
elects to apply this Section 6.04 to all Participants, the
preceding provisions of this Section 6.04 apply to all
Participants described in the first two paragraphs of this
Section 6.04, without regard to the limitations of this Section
6.04(E). Sections 6.05 and 6.06 only apply to Participants to
whom the preceding provisions of this Section 6.04 apply.
6.05 WAIVER ELECTION - QUALIFIED JOINT AND SURVIVOR ANNUITY.
------------------------------------------------------
Not earlier than 90 days, but not later than 30 days, before the
Participant's annuity starting date, the Advisory Committee must
provide the Participant a written explanation of the terms and
conditions of the qualified joint and survivor annuity, the
Participant's right to make, and the effect of, an election to
waive the joint and survivor form of benefit, the rights of the
Participant's spouse regarding the waiver election and the
Participant's right to make, and the effect of, a revocation of a
waiver election. The Plan does not limit the number of times the
Participant may revoke a waiver of the qualified joint and
survivor annuity or make a new waiver during the election period.
A married Participant's waiver election is not valid unless (a)
the Participant's spouse (to whom the survivor annuity is payable
under the qualified joint and survivor annuity), after the
Participant has received the written explanation described in
this Section 6.05, has consented in writing to the waiver
election, the spouse's consent acknowledges the effect of the
election, and a notary public or the Plan Administrator (or his
representative) witnesses the spouse's consent, (b) the spouse
consents to the alternate form of payment designated by the
Participant or to any change in that designated form of payment,
and (c) unless the spouse is the Participant's sole primary
Beneficiary, the spouse consents to the Participant's Beneficiary
designation or to any change in the Participant's Beneficiary
designation. The spouse's consent to a waiver of the qualified
joint and survivor annuity is irrevocable, unless the Participant
revokes the waiver election. The spouse may execute a blanket
consent to any form of payment designation or to any Beneficiary
designation made by the Participant, if the spouse acknowledges
the right to limit that consent to a specific designation but, in
writing, waives that right. The consent requirements of this
Section 6.05 apply to a former spouse of the Participant, to the
extent required under a qualified domestic relations order
described in Section 6.07.
The Advisory Committee will accept as valid a waiver election
which does not satisfy the spousal consent requirements if the
Advisory Committee establishes the Participant does not have a
spouse, the Advisory Committee is not able to locate the
Participant's spouse, the Participant is legally separated or has
been abandoned (within the meaning of State law) and the
Participant has a court order to that effect, or other
circumstances exist under which the Secretary of the Treasury
will excuse the consent requirement. If the Participant's spouse
is legally incompetent to give consent, the spouse's legal
guardian (even if the guardian is the Participant) may give
consent.
6.06 WAIVER ELECTION - PRERETIREMENT SURVIVOR ANNUITY. The
------------------------------------------------
Advisory Committee must provide a written explanation of the
preretirement survivor annuity to each married Participant,
within the following period which ends last: (1) the period
beginning on the first day of the Plan Year in which the
Participant attains age 32 and ending on the last day of the Plan
Year in which the Participant attains age 34; (2) a reasonable
period after an Employee becomes a Participant; (3) a reasonable
period after the joint and survivor rules become applicable to
the Participant; or (4) a reasonable period after a fully
subsidized preretirement survivor annuity no longer satisfies the
requirements for a fully subsidized benefit. A reasonable period
described in clauses (2), (3) and (4) is the period beginning one
year before and ending one year after the applicable event. If
the Participant separates from Service before attaining age 35,
clauses (1), (2), (3) and (4) do not apply and the Advisory
Committee must provide the written explanation within the period
beginning one year before and ending one year after the
Separation from Service. The written explanation must describe,
in a manner consistent with Treasury regulations, the terms and
conditions of the preretirement survivor annuity comparable to
the explanation of the qualified joint and survivor annuity
required under Section 6.05. The Plan does not limit the number
of times the Participant may revoke a waiver of the preretirement
survivor annuity or make a new waiver during the election period.
A Participant's waiver election of the preretirement survivor
annuity is not valid unless (a) the Participant makes the waiver
election no earlier than the first day of the Plan Year in which
he attains age 35 and (b) the Participant's spouse (to whom the
preretirement survivor annuity is payable) satisfies the consent
requirements described in Section 6.05, except the spouse need
not consent to the form of benefit payable to the designated
Beneficiary. The spouse's consent to the waiver of the
preretirement survivor annuity is irrevocable, unless the
Participant revokes the waiver election. Irrespective of the time
of election requirement described in clause (a), if the
Participant separates from Service prior to the first day of the
Plan Year in which he attains age 35, the Advisory Committee will
accept a waiver election as respects the Participant's Accrued
Benefit attributable to his Service prior to his Separation from
Service. Furthermore, if a Participant who has not separated from
Service makes a valid waiver election, except for the timing
requirement of clause (a), the Advisory Committee will accept
that election as valid, but only until the first day of the Plan
Year in which the Participant attains age 35. A waiver election
described in this paragraph is not valid unless made after the
Participant has received the written explanation described in
this Section 6.06.
6.07 DISTRIBUTIONS UNDER DOMESTIC RELATIONS ORDERS. Nothing
-----------------------------------------------------
contained in this Plan prevents the Trustee, in accordance with
the direction of the Advisory Committee, from complying with the
provisions of a qualified domestic relations order (as defined in
Code Section 414(p)). This Plan specifically permits distribution
to an alternate payee under a qualified domestic relations order
at any time, irrespective of whether the Participant has attained
his earliest retirement age (as defined under Code Section
414(p)) under the Plan. A distribution to an alternate payee
prior to the Participant's attainment of earliest retirement age
is available only if: (1) the order specifies distribution at that
time or permits an agreement between the Plan and the alternate
payee to authorize an earlier distribution; and (2) if the present
value of the alternate payee's benefits under the Plan exceeds $3,500,
and the order requires, the alternate payee consents to any distribution
occurring prior to the Participant's attainment of earliest retirement
age. The Employer, in an addendum to its Adoption Agreement numbered
6.07, may elect to limit distribution to an alternate payee only when
the Participant has attained his earliest retirement age under the Plan.
Nothing in this Section 6.07 gives a Participant a right to receive
distribution at a time otherwise not permitted under the Plan nor does
it permit the alternate payee to receive a form of payment not otherwise
permitted under the Plan.
The Advisory Committee must establish reasonable procedures to
determine the qualified status of a domestic relations order. Upon
receiving a domestic relations order, the Advisory Committee promptly
will notify the Participant and any alternate payee named in the order,
in writing, of the receipt of the order and the Plan's procedures for
determining the qualified status of the order. Within a reasonable
period of time after receiving the domestic relations order, the
Advisory Committee must determine the qualified status of the order
and must notify the Participant and each alternate payee, in writing,
of its determination. The Advisory Committee must provide notice under
this paragraph by mailing to the individual's address specified in the
domestic relations order, or in a manner consistent with Department of
Labor regulations.
If any portion of the Participant's Nonforfeitable Accrued Benefit
is payable during the period the Advisory Committee is making its
determination of the qualified status of the domestic relations order,
the Advisory Committee must make a separate accounting of the amounts
payable. If the Advisory Committee determines the order is a qualified
domestic relations order within 18 months of the date amounts first are
payable following receipt of the order, the Advisory Committee will
direct the Trustee to distribute the payable amounts in accordance with
the order. If the Advisory Committee does not make its determination of
the qualified status of the order within the 18-month determination
period, the Advisory Committee will direct the Trustee to distribute
the payable amounts in the manner the Plan would distribute if the order
did not exist and will apply the order prospectively if the Advisory
Committee later determines the order is a qualified domestic relations
order.
To the extent it is not inconsistent with the provisions of the
qualified domestic relations order, the Advisory Committee may
direct the Trustee to invest any partitioned amount in a
segregated subaccount or separate account and to invest the
account in Federally insured, interest-bearing savings account(s)
or time deposit(s) (or a combination of both), or in other fixed
income investments. A segregated subaccount remains a part of the
Trust, but it alone shares in any income it earns, and it alone
bears any expense or loss it incurs. The Trustee will make any
payments or distributions required under this Section 6.07 by
separate benefit checks or other separate distribution to the
alternate payee(s).
* * * * * * * * * * * * * * *
ARTICLE VII
EMPLOYER ADMINISTRATIVE PROVISIONS
7.01 INFORMATION TO COMMITTEE. The Employer must supply
--------------------------
current information to the Advisory Committee as to the name,
date of birth, date of employment, annual compensation, leaves of
absence, Years of Service and date of termination of employment
of each Employee who is, or who will be eligible to become, a
Participant under the Plan, together with any other information
which the Advisory Committee considers necessary. The Employer's
records as to the current information the Employer furnishes to
the Advisory Committee are conclusive as to all persons.
7.02 NO LIABILITY. The Employer assumes no obligation or
------------
responsibility to any of its Employees, Participants or
Beneficiaries for any act of, or failure to act, on the part of
its Advisory Committee (unless the Employer is the Advisory
Committee), the Trustee, the Custodian, if any, or the Plan
Administrator (unless the Employer is the Plan Administrator).
7.03 INDEMNITY OF CERTAIN FIDUCIARIES. The Employer
--------------------------------
indemnifies and saves harmless the Plan Administrator and the
members of the Advisory Committee, and each of them, from and
against any and all loss resulting from liability to which the
Plan Administrator and the Advisory Committee, or the members of
the Advisory Committee, may be subjected by reason of any act or
conduct (except willful misconduct or gross negligence) in their
official capacities in the administration of this Trust or Plan
or both, including all expenses reasonably incurred in their
defense, in case the Employer fails to provide such defense. The
indemnification provisions of this Section 7.03 do not relieve
the Plan Administrator or any Advisory Committee member from any
liability he may have under ERISA for breach of a fiduciary duty.
Furthermore, the Plan Administrator and the Advisory Committee
members and the Employer may execute a letter agreement further
delineating the indemnification agreement of this Section 7.03,
provided the letter agreement must be consistent with and does
not violate ERISA. The indemnification provisions of this Section
7.03 extend to the Trustee (or to a Custodian, if any) solely to
the extent provided by a letter agreement executed by the Trustee
(or Custodian) and the Employer.
7.04 EMPLOYER DIRECTION OF INVESTMENT. The Employer has the
--------------------------------
right to direct the Trustee with respect to the investment and
re-investment of assets comprising the Trust Fund only if the
Trustee consents in writing to permit such direction. If the
Trustee consents to Employer direction of investment, the Trustee
and the Employer must execute a letter agreement as a part of
this Plan containing such conditions, limitations and other
provisions they deem appropriate before the Trustee will follow
any Employer direction as respects the investment or re-investment
of any part of the Trust Fund.
7.05 AMENDMENT TO VESTING SCHEDULE. Though the Employer
-----------------------------
reserves the right to amend the vesting schedule at any time, the
Advisory Committee will not apply the amended vesting schedule to
reduce the Nonforfeitable percentage of any Participant's Accrued
Benefit derived from Employer contributions (determined as of the
later of the date the Employer adopts the amendment, or the date
the amendment becomes effective) to a percentage less than the
Nonforfeitable percentage computed under the Plan without regard
to the amendment. An amended vesting schedule will apply to a
Participant only if the Participant receives credit for at least
one Hour of Service after the new schedule becomes effective.
If the Employer makes a permissible amendment to the vesting
schedule, each Participant having at least 3 Years of Service
with the Employer may elect to have the percentage of his
Nonforfeitable Accrued Benefit computed under the Plan without
regard to the amendment. For Plan Years beginning prior to
January 1, 1989, the election described in the preceding sentence
applies only to Participants having at least 5 Years of Service
with the Employer. The Participant must file his election with
the Advisory Committee within 60 days of the latest of (a) the
Employer's adoption of the amendment; (b) the effective date of
the amendment; or (c) his receipt of a copy of the amendment. The
Advisory Committee, as soon as practicable, must forward a true
copy of any amendment to the vesting schedule to each affected
Participant, together with an explanation of the effect of the
amendment, the appropriate form upon which the Participant may
make an election to remain under the vesting schedule provided
under the Plan prior to the amendment and notice of the time
within which the Participant must make an election to remain
under the prior vesting schedule. The election described in this
Section 7.05 does not apply to a Participant if the amended
vesting schedule provides for vesting at least as rapid at all
times as the vesting schedule in effect prior to the amendment.
For purposes of this Section 7.05, an amendment to the vesting
schedule includes any Plan amendment which directly or indirectly
affects the computation of the Nonforfeitable percentage of an
Employee's rights to his Employer derived Accrued Benefit.
Furthermore, the Advisory Committee must treat any shift in the
vesting schedule, due to a change in the Plan's top heavy status,
as an amendment to the vesting schedule for purposes of this
Section 7.05.
* * * * * * * * * * * * * * *
ARTICLE VIII
PARTICIPANT ADMINISTRATIVE PROVISIONS
8.01 BENEFICIARY DESIGNATION. Any Participant may from time
-----------------------
to time designate, in writing, any person or persons,
contingently or successively, to whom the Trustee will pay his
Nonforfeitable Accrued Benefit (including any life insurance
proceeds payable to the Participant's Account) in the event of
his death and the Participant may designate the form and method
of payment. The Advisory Committee will prescribe the form for
the written designation of Beneficiary and, upon the
Participant's filing the form with the Advisory Committee, the
form effectively revokes all designations filed prior to that
date by the same Participant.
(A) Coordination with survivor requirements. If the joint and
survivor requirements of Article VI apply to the Participant,
this Section 8.01 does not impose any special spousal consent
requirements on the Participant's Beneficiary designation.
However, in the absence of spousal consent (as required by
Article VI) to the Participant's Beneficiary designation: (1) any
waiver of the joint and survivor annuity or of the preretirement
survivor annuity is not valid; and (2) if the Participant dies
prior to his annuity starting date, the Participant's Beneficiary
designation will apply only to the portion of the death benefit
which is not payable as a preretirement survivor annuity.
Regarding clause (2), if the Participant's surviving spouse is a
primary Beneficiary under the Participant's Beneficiary
designation, the Trustee will satisfy the spouse's interest in
the Participant's death benefit first from the portion which is
payable as a preretirement survivor annuity.
(B) Profit sharing plan exception. If the Plan is a profit
sharing plan, the Beneficiary designation of a married Exempt
Participant is not valid unless the Participant's spouse consents
(in a manner described in Section 6.05) to the Beneficiary
designation. An "Exempt Participant" is a Participant who is not
subject to the joint and survivor requirements of Article VI. The
spousal consent requirement in this paragraph does not apply if
the Exempt Participant and his spouse are not married throughout
the one year period ending on the date of the Participant's
death, or if the Participant's spouse is the Participant's sole
primary Beneficiary.
8.02 NO BENEFICIARY DESIGNATION/DEATH OF BENEFICIARY. If a
-----------------------------------------------
Participant fails to name a Beneficiary in accordance with
Section 8.01, or if the Beneficiary named by a Participant
predeceases him, then the Trustee will pay the Participant's
Nonforfeitable Accrued Benefit in accordance with Section 6.02
in the following order of priority, unless the Employer specifies
a different order of priority in an addendum to its Adoption
Agreement, to:
(a) The Participant's surviving spouse;
(b) The Participant's surviving children, including adopted
children, in equal shares;
(c) The Participant's surviving parents, in equal shares; or
(d) The Participant's estate.
If the Beneficiary does not predecease the Participant, but
dies prior to distribution of the Participant's entire
Nonforfeitable Accrued Benefit, the Trustee will pay the
remaining Nonforfeitable Accrued Benefit to the Beneficiary's
estate unless the Participant's Beneficiary designation provides
otherwise or unless the Employer provides otherwise in its
Adoption Agreement. If the Plan is a profit sharing plan, and the
Plan includes Exempt Participants, the Employer may not specify a
different order of priority in the Adoption Agreement unless the
Participant's surviving spouse will be first in the different
order of priority. The Advisory Committee will direct the Trustee
as to the method and to whom the Trustee will make payment under
this Section 8.02.
8.03 PERSONAL DATA TO COMMITTEE. Each Participant and each
--------------------------
Beneficiary of a deceased Participant must furnish to the
Advisory Committee such evidence, data or information as the
Advisory Committee considers necessary or desirable for the
purpose of administering the Plan. The provisions of this Plan
are effective for the benefit of each Participant upon the
condition precedent that each Participant will furnish promptly
full, true and complete evidence, data and information when
requested by the Advisory Committee, provided the Advisory
Committee advises each Participant of the effect of his failure
to comply with its request.
8.04 ADDRESS FOR NOTIFICATION. Each Participant and each
------------------------
Beneficiary of a deceased Participant must file with the Advisory
Committee from time to time, in writing, his post office address
and any change of post office address. Any communication,
statement or notice addressed to a Participant, or Beneficiary,
at his last post office address filed with the Advisory
Committee, or as shown on the records of the Employer, binds the
Participant, or Beneficiary, for all purposes of this Plan.
8.05 ASSIGNMENT OR ALIENATION. Subject to Code Section
------------------------
414(p) relating to qualified domestic relations orders, neither a
Participant nor a Beneficiary may anticipate, assign or alienate
(either at law or in equity) any benefit provided under the Plan,
and the Trustee will not recognize any such anticipation,
assignment or alienation. Furthermore, a benefit under the Plan
is not subject to attachment, garnishment, levy, execution or
other legal or equitable process.
8.06 NOTICE OF CHANGE IN TERMS. The Plan Administrator,
-------------------------
within the time prescribed by ERISA and the applicable
regulations, must furnish all Participants and Beneficiaries a
summary description of any material amendment to the Plan or
notice of discontinuance of the Plan and all other information
required by ERISA to be furnished without charge.
8.07 LITIGATION AGAINST THE TRUST. A court of competent
----------------------------
jurisdiction may authorize any appropriate equitable relief to
redress violations of ERISA or to enforce any provisions of ERISA
or the terms of the Plan. A fiduciary may receive reimbursement
of expenses properly and actually incurred in the performance of
his duties with the Plan.
8.08 INFORMATION AVAILABLE. Any Participant in the Plan or
---------------------
any Beneficiary may examine copies of the Plan description,
latest annual report, any bargaining agreement, this Plan and
Trust, contract or any other instrument under which the Plan was
established or is operated. The Plan Administrator will maintain
all of the items listed in this Section 8.08 in his office, or in
such other place or places as he may designate from time to time
in order to comply with the regulations issued under ERISA, for
examination during reasonable business hours. Upon the written
request of a Participant or Beneficiary the Plan Administrator
must furnish him with a copy of any item listed in this Section
8.08. The Plan Administrator may make a reasonable charge to the
requesting person for the copy so furnished.
8.09 APPEAL PROCEDURE FOR DENIAL OF BENEFITS. A Participant
-------------------------------------------------------
or a Beneficiary ("Claimant") may file with the Advisory
Committee a written claim for benefits, if the Participant or
Beneficiary determines the distribution procedures of the Plan
have not provided him his proper Nonforfeitable Accrued Benefit.
The Advisory Committee must render a decision on the claim within
60 days of the Claimant's written claim for benefits. The Plan
Administrator must provide adequate notice in writing to the
Claimant whose claim for benefits under the Plan the Advisory
Committee has denied. The Plan Administrator's notice to the
Claimant must set forth:
(a) The specific reason for the denial;
(b) Specific references to pertinent Plan provisions on which
the Advisory Committee based its denial;
(c) A description of any additional material and information
needed for the Claimant to perfect his claim and an explanation
of why the material or information is needed; and
(d) That any appeal the Claimant wishes to make of the adverse
determination must be in writing to the Advisory Committee
within 75 days after receipt of the Plan Administrator's notice
of denial of benefits. The Plan Administrator's notice must
further advise the Claimant that his failure to appeal the
action to the Advisory Committee in writing within the 75-day
period will render the Advisory Committee's determination
final, binding and conclusive.
If the Claimant should appeal to the Advisory Committee, he, or
his duly authorized representative, may submit, in writing,
whatever issues and comments he, or his duly authorized
representative, feels are pertinent. The Claimant, or his duly
authorized representative, may review pertinent Plan documents.
The Advisory Committee will re-examine all facts related to the
appeal and make a final determination as to whether the denial of
benefits is justified under the circumstances. The Advisory
Committee must advise the Claimant of its decision within 60 days
of the Claimant's written request for review, unless special
circumstances (such as a hearing) would make the rendering of a
decision within the 60-day limit unfeasible, but in no event may
the Advisory Committee render a decision respecting a denial for
a claim for benefits later than 120 days after its receipt of a
request for review.
The Plan Administrator's notice of denial of benefits must
identify the name of each member of the Advisory Committee and
the name and address of the Advisory Committee member to whom the
Claimant may forward his appeal.
8.10 PARTICIPANT DIRECTION OF INVESTMENT. A Participant has
-----------------------------------
the right to direct the Trustee with respect to the investment or
re-investment of the assets comprising the Participant's individual
Account only if the Trustee consents in writing to permit such
direction. If the Trustee consents to Participant direction of
investment, the Trustee will accept direction from each Participant
on a written election form (or other written agreement), as a part
of this Plan, containing such conditions, limitations and other
provisions the parties deem appropriate. The Trustee or, with the
Trustee's consent, the Advisory Committee, may establish written
procedures, incorporated specifically as part of this Plan,
relating to Participant direction of investment under this
Section 8.10. The Trustee will maintain a segregated investment
Account to the extent a Participant's Account is subject to
Participant self-direction. The Trustee is not liable for any
loss, nor is the Trustee liable for any breach, resulting from
a Participant's direction of the investment of any part of his
directed Account.
The Advisory Committee, to the extent provided in a written
loan policy adopted under Section 9.04, will treat a loan made to
a Participant as a Participant direction of investment under this
Section 8.10. To the extent of the loan outstanding at any time,
the borrowing Participant's Account alone shares in any interest
paid on the loan, and it alone bears any expense or loss it
incurs in connection with the loan. The Trustee may retain any
principal or interest paid on the borrowing Participant's loan in
an interest bearing segregated Account on behalf of the borrowing
Participant until the Trustee (or the Named Fiduciary, in the case
of a nondiscretionary Trustee) deems it appropriate to add the
amount paid to the Participant's separate Account under the Plan.
If the Trustee consents to Participant direction of investment
of his Account, the Plan treats any post-December 31, 1981,
investment by a Participant's directed Account in collectibles
(as defined by Code Section 408(m)) as a deemed distribution to
the Participant for Federal income tax purposes.
* * * * * * * * * * * * * * *
ARTICLE IX
ADVISORY COMMITTEE - DUTIES WITH RESPECT TO PARTICIPANTS' ACCOUNTS
9.01 MEMBERS' COMPENSATION, EXPENSES. The Employer must
-------------------------------
appoint an Advisory Committee to administer the Plan, the members
of which may or may not be Participants in the Plan, or which may
be the Plan Administrator acting alone. In the absence of an
Advisory Committee appointment, the Plan Administrator assumes
the powers, duties and responsibilities of the Advisory
Committee. The members of the Advisory Committee will serve
without compensation for services as such, but the Employer will
pay all expenses of the Advisory Committee, except to the extent
the Trust properly pays for such expenses, pursuant to Article X.
9.02 TERM. Each member of the Advisory Committee serves
----
until the appointment of his successor.
9.03 POWERS. In case of a vacancy in the membership of the
------
Advisory Committee, the remaining members of the Advisory
Committee may exercise any and all of the powers, authority,
duties and discretion conferred upon the Advisory Committee
pending the filling of the vacancy.
9.04 GENERAL. The Advisory Committee has the following
-------
powers and duties:
(a) To select a Secretary, who need not be a member of the
Advisory Committee;
(b) To determine the rights of eligibility of an Employee to
participate in the Plan, the value of a Participant's Accrued
Benefit and the Nonforfeitable percentage of each Participant's
Accrued Benefit;
(c) To adopt rules of procedure and regulations necessary for
the proper and efficient administration of the Plan provided
the rules are not inconsistent with the terms of this
Agreement;
(d) To construe and enforce the terms of the Plan and the rules
and regulations it adopts, including interpretation of the Plan
documents and documents related to the Plan's operation;
(e) To direct the Trustee as respects the crediting and
distribution of the Trust;
(f) To review and render decisions respecting a claim for (or
denial of a claim for) a benefit under the Plan;
(g) To furnish the Employer with information which the Employer
may require for tax or other purposes;
(h) To engage the service of agents whom it may deem advisable
to assist it with the performance of its duties;
(i) To engage the services of an Investment Manager or Managers
(as defined in ERISA Section 3(38)), each of whom will have
full power and authority to manage, acquire or dispose (or
direct the Trustee with respect to acquisition or disposition)
of any Plan asset under its control;
(j) To establish, in its sole discretion, a nondiscriminatory
policy (see Section 9.04(A)) which the Trustee must observe in
making loans, if any, to Participants and Beneficiaries; and
(k) To establish and maintain a funding standard account and to
make credits and charges to the account to the extent required
by and in accordance with the provisions of the Code.
The Advisory Committee must exercise all of its powers, duties
and discretion under the Plan in a uniform and nondiscriminatory
manner.
(A) Loan Policy. If the Advisory Committee adopts a loan policy,
pursuant to paragraph (j), the loan policy must be a written
document and must include: (1) the identity of the person or
positions authorized to administer the participant loan program;
(2) a procedure for applying for the loan; (3) the criteria for
approving or denying a loan; (4) the limitations, if any, on the
types and amounts of loans available; (5) the procedure for
determining a reasonable rate of interest; (6) the types of
collateral which may secure the loan; and (7) the events
constituting default and the steps the Plan will take to preserve
plan assets in the event of default. This Section 9.04
specifically incorporates a written loan policy as part of the
Employer's Plan.
9.05 FUNDING POLICY. The Advisory Committee will review, not
--------------
less often than annually, all pertinent Employee information and
Plan data in order to establish the funding policy of the Plan
and to determine the appropriate methods of carrying out the
Plan's objectives. The Advisory Committee must communicate
periodically, as it deems appropriate, to the Trustee and to any
Plan Investment Manager the Plan's short-term and long-term
financial needs so investment policy can be coordinated with Plan
financial requirements.
9.06 MANNER OF ACTION. The decision of a majority of the
----------------
members appointed and qualified controls.
9.07 AUTHORIZED REPRESENTATIVE. The Advisory Committee may
--------------------------
authorize any one of its members, or its Secretary, to sign on
its behalf any notices, directions, applications, certificates,
consents, approvals, waivers, letters or other documents. The
Advisory Committee must evidence this authority by an instrument
signed by all members and filed with the Trustee.
9.08 INTERESTED MEMBER. No member of the Advisory Committee
-----------------
may decide or determine any matter concerning the distribution,
nature or method of settlement of his own benefits under the
Plan, except in exercising an election available to that member
in his capacity as a Participant, unless the Plan Administrator
is acting alone in the capacity of the Advisory Committee.
9.09 INDIVIDUAL ACCOUNTS. The Advisory Committee will
-------------------
maintain, or direct the Trustee to maintain, a separate Account,
or multiple Accounts, in the name of each Participant to reflect
the Participant's Accrued Benefit under the Plan. If a Participant
re-enters the Plan subsequent to his having a Forfeiture Break in
Service, the Advisory Committee, or the Trustee, must maintain a
separate Account for the Participant's pre-Forfeiture Break in
Service Accrued Benefit and a separate Account for his post-
Forfeiture Break in Service Accrued Benefit, unless the Participant's
entire Accrued Benefit under the Plan is 100% Nonforfeitable.
The Advisory Committee will make its allocations, or request
the Trustee to make its allocations, to the Accounts of the
Participants in accordance with the provisions of Section 9.11.
The Advisory Committee may direct the Trustee to maintain a
temporary segregated investment Account in the name of a
Participant to prevent a distortion of income, gain or loss
allocations under Section 9.11. The Advisory Committee must
maintain records of its activities.
9.10 VALUE OF PARTICIPANT'S ACCRUED BENEFIT. The value of
--------------------------------------
each Participant's Accrued Benefit consists of that proportion of
the net worth (at fair market value) of the Employer's Trust Fund
which the net credit balance in his Account (exclusive of the
cash value of incidental benefit insurance contracts) bears to
the total net credit balance in the Accounts (exclusive of the
cash value of the incidental benefit insurance contracts) of all
Participants plus the cash surrender value of any incidental
benefit insurance contracts held by the Trustee on the
Participant's life.
For purposes of a distribution under the Plan, the value of a
Participant's Accrued Benefit is its value as of the valuation
date immediately preceding the date of the distribution. Any
distribution (other than a distribution from a segregated
Account) made to a Participant (or to his Beneficiary) more than
90 days after the most recent valuation date may include interest
on the amount of the distribution as an expense of the Trust
Fund. The interest, if any, accrues from such valuation date to
the date of the distribution at the rate established in the
Employer's Adoption Agreement.
9.11 ALLOCATION AND DISTRIBUTION OF NET INCOME GAIN OR LOSS.
------------------------------------------------------
A "valuation date" under this Plan is each Accounting Date and
each interim valuation date determined under Section 10.14. As of
each valuation date the Advisory Committee must adjust Accounts
to reflect net income, gain or loss since the last valuation
date. The valuation period is the period beginning the day after
the last valuation date and ending on the current valuation date.
(A) Trust Fund Accounts. The allocation provisions of this
paragraph apply to all Participant Accounts other than
segregated investment Accounts. The Advisory Committee first
will adjust the Participant Accounts, as those Accounts stood
at the beginning of the current valuation period, by reducing
the Accounts for any forfeitures arising under Section 5.09 or
under Section 9.14, for amounts charged during the valuation
period to the Accounts in accordance with Section 9.13 (relating
to distributions) and Section 11.01 (relating to insurance
premiums), and for the cash value of incidental benefit
insurance contracts. The Advisory Committee then, subject to
the restoration allocation requirements of Section 5.04 or of
Section 9.14, will allocate the net income, gain or loss pro
rata to the adjusted Participant Accounts. The allocable net
income, gain or loss is the net income (or net loss), including
the increase or decrease in the fair market value of assets,
since the last valuation date.
(B) Segregated investment Accounts. A segregated investment
Account receives all income it earns and bears all expense or
loss it incurs. The Advisory Committee will adopt uniform and
nondiscriminatory procedures for determining income or loss
of a segregated investment Account in a manner which reasonably
reflects investment directions relating to pooled investments
and investment directions occurring during a valuation period.
As of the valuation date, the Advisory Committee must reduce a
segregated Account for any forfeiture arising under Section 5.09
after the Advisory Committee has made all other allocations,
changes or adjustments to the Account for the Plan Year.
(C) Additional rules. An Excess Amount or suspense account
described in Part 2 of Article III does not share in the
allocation of net income, gain or loss described in this
Section 9.11. If the Employer maintains its Plan under a Code
Section 401(k) Adoption Agreement, the Employer may specify in
its Adoption Agreement alternate valuation provisions authorized
by that Adoption Agreement. This Section 9.11 applies solely to
the allocation of net income, gain or loss of the Trust. The
Advisory Committee will allocate the Employer contributions and
Participant forfeitures, if any, in accordance with Article III.
9.12 INDIVIDUAL STATEMENT. As soon as practicable after
--------------------
the Accounting Date of each Plan Year, but within the time
prescribed by ERISA and the regulations under ERISA, the Plan
Administrator will deliver to each Participant (and to each
Beneficiary) a statement reflecting the condition of his Accrued
Benefit in the Trust as of that date and such other information
ERISA requires be furnished the Participant or Beneficiary. No
Participant, except a member of the Advisory Committee, has the
right to inspect the records reflecting the Account of any other
Participant.
9.13 ACCOUNT CHARGED. The Advisory Committee will charge a
---------------
Participant's Account for all distributions made from that Account
to the Participant, to his Beneficiary or to an alternate payee.
The Advisory Committee also will charge a Participant's Account
for any administrative expenses incurred by the Plan directly
related to that Account.
9.14 UNCLAIMED ACCOUNT PROCEDURE. The Plan does not require
---------------------------
either the Trustee or the Advisory Committee to search for, or to
ascertain the whereabouts of, any Participant or Beneficiary. At
the time the Participant's or Beneficiary's benefit becomes
distributable under Article VI, the Advisory Committee, by
certified or registered mail addressed to his last known address
of record with the Advisory Committee or the Employer, must
notify any Participant, or Beneficiary, that he is entitled to a
distribution under this Plan. The notice must quote the
provisions of this Section 9.14 and otherwise must comply with
the notice requirements of Article VI. If the Participant, or
Beneficiary, fails to claim his distributive share or make his
whereabouts known in writing to the Advisory Committee within 6
months from the date of mailing of the notice, the Advisory
Committee will treat the Participant's or Beneficiary's unclaimed
payable Accrued Benefit as forfeited and will reallocate the
unclaimed payable Accrued Benefit in accordance with Section
3.05. A forfeiture under this paragraph will occur at the end of
the notice period or, if later, the earliest date applicable
Treasury regulations would permit the forfeiture. Pending
forfeiture, the Advisory Committee, following the expiration of
the notice period, may direct the Trustee to segregate the
Nonforfeitable Accrued Benefit in a segregated Account and to
invest that segregated Account in Federally insured interest
bearing savings accounts or time deposits (or in a combination of
both), or in other fixed income investments.
If a Participant or Beneficiary who has incurred a forfeiture
of his Accrued Benefit under the provisions of the first
paragraph of this Section 9.14 makes a claim, at any time, for
his forfeited Accrued Benefit, the Advisory Committee must
restore the Participant's or Beneficiary's forfeited Accrued
Benefit to the same dollar amount as the dollar amount of the
Accrued Benefit forfeited, unadjusted for any gains or losses
occurring subsequent to the date of the forfeiture. The Advisory
Committee will make the restoration during the Plan Year in which
the Participant or Beneficiary makes the claim, first from the
amount, if any, of Participant forfeitures the Advisory Committee
otherwise would allocate for the Plan Year, then from the amount,
if any, of the Trust Fund net income or gain for the Plan Year
and then from the amount, or additional amount, the Employer
contributes to enable the Advisory Committee to make the required
restoration. The Advisory Committee must direct the Trustee to
distribute the Participant's or Beneficiary's restored Accrued
Benefit to him not later than 60 days after the close of the Plan
Year in which the Advisory Committee restores the forfeited
Accrued Benefit. The forfeiture provisions of this Section 9.14
apply solely to the Participant's or to the Beneficiary's Accrued
Benefit derived from Employer contributions.
* * * * * * * * * * * * * * *
ARTICLE X
CUSTODIAN/TRUSTEE, POWERS AND DUTIES
10.01 ACCEPTANCE. The Trustee accepts the Trust created under
----------
the Plan and agrees to perform the obligations imposed. The
Trustee must provide bond for the faithful performance of its
duties under the Trust to the extent required by XXXXX.
10.02 RECEIPT OF CONTRIBUTIONS. The Trustee is accountable to
------------------------
the Employer for the funds contributed to it by the Employer, but
does not have any duty to see that the contributions received
comply with the provisions of the Plan. The Trustee is not
obliged to collect any contributions from the Employer, nor is
obliged to see that funds deposited with it are deposited
according to the provisions of the Plan.
10.03 INVESTMENT POWERS.
-----------------
[A] Discretionary Trustee Designation. If the Employer, in
Adoption Agreement Section 1.02, designates the Trustee to
administer the Trust as a discretionary Trustee, then the Trustee
has full discretion and authority with regard to the investment
of the Trust Fund, except with respect to a Plan asset under the
control or direction of a properly appointed Investment Manager
or with respect to a Plan asset properly subject to Employer,
Participant or Advisory Committee direction of investment. The
Trustee must coordinate its investment policy with Plan financial
needs as communicated to it by the Advisory Committee. The
Trustee is authorized and empowered, but not by way of
limitation, with the following powers, rights and duties:
(a) To invest any part or all of the Trust Fund in any common
or preferred stocks, open-end or closed-end mutual funds, put
and call options traded on a national exchange, United States
retirement plan bonds, corporate bonds, debentures, convertible
debentures, commercial paper, U.S. Treasury bills, U.S.
Treasury notes and other direct or indirect obligations of the
United States Government or its agencies, improved or
unimproved real estate situated in the United States, limited
partnerships, insurance contracts of any type, mortgages, notes
or other property of any kind, real or personal, to buy or sell
options on common stock on a nationally recognized exchange with
or without holding the underlying common stock, to buy and sell
commodities, commodity options and contracts for the future
delivery of commodities, and to make any other investments the
Trustee deems appropriate, as a prudent man would do under like
circumstances with due regard for the purposes of this Plan. Any
investment made or retained by the Trustee in good faith is proper
but must be of a kind constituting a diversification considered by
law suitable for trust investments.
(b) To retain in cash so much of the Trust Fund as it may deem
advisable to satisfy liquidity needs of the Plan and to deposit
any cash held in the Trust Fund in a bank account at reasonable
interest.
(c) To invest, if the Trustee is a bank or similar financial
institution supervised by the United States or by a State, in
any type of deposit of the Trustee (or of a bank related to the
Trustee within the meaning of Code Section 414(b)) at a reasonable
rate of interest or in a common trust fund, as described in Code
Section 584, or in a collective investment fund, the provisions
of which govern the investment of such assets and which the Plan
incorporates by this reference, which the Trustee (or its affiliate,
as defined in Code Section 1504) maintains exclusively for the
collective investment of money contributed by the bank (or the
affiliate) in its capacity as trustee and which conforms to the
rules of the Comptroller of the Currency.
(d) To manage, sell, contract to sell, grant options to
purchase, convey, exchange, transfer, abandon, improve, repair,
insure, lease for any term even though commencing in the future
or extending beyond the term of the Trust, and otherwise deal
with all property, real or personal, in such manner, for such
considerations and on such terms and conditions as the Trustee
decides.
(e) To credit and distribute the Trust as directed by the
Advisory Committee. The Trustee is not obliged to inquire as to
whether any payee or distributee is entitled to any payment or
whether the distribution is proper or within the terms of the
Plan, or as to the manner of making any payment or
distribution. The Trustee is accountable only to the Advisory
Committee for any payment or distribution made by it in good
faith on the order or direction of the Advisory Committee.
(f) To borrow money, to assume indebtedness, extend mortgages
and encumber by mortgage or pledge.
(g) To compromise, contest, arbitrate or abandon claims and
demands, in its discretion.
(h) To have with respect to the Trust all of the rights of an
individual owner, including the power to give proxies, to
participate in any voting trusts, mergers, consolidations or
liquidations, and to exercise or sell stock subscriptions or
conversion rights.
(i) To lease for oil, gas and other mineral purposes and to
create mineral severances by grant or reservation; to pool or
unitize interests in oil, gas and other minerals; and to enter
into operating agreements and to execute division and transfer
orders.
(j) To hold any securities or other property in the name of the
Trustee or its nominee, with depositories or agent depositories
or in another form as it may deem best, with or without
disclosing the trust relationship.
(k) To perform any and all other acts in its judgment necessary
or appropriate for the proper and advantageous management,
investment and distribution of the Trust.
(l) To retain any funds or property subject to any dispute
without liability for the payment of interest, and to decline
to make payment or delivery of the funds or property until
final adjudication is made by a court of competent
jurisdiction.
(m) To file all tax returns required of the Trustee.
(n) To furnish to the Employer, the Plan Administrator and the
Advisory Committee an annual statement of account showing the
condition of the Trust Fund and all investments, receipts,
disbursements and other transactions effected by the Trustee
during the Plan Year covered by the statement and also stating
the assets of the Trust held at the end of the Plan Year, which
accounts are conclusive on all persons, including the Employer,
the Plan Administrator and the Advisory Committee, except as to
any act or transaction concerning which the Employer, the Plan
Administrator or the Advisory Committee files with the Trustee
written exceptions or objections within 90 days after the
receipt of the accounts or for which XXXXX authorizes a longer
period within which to object.
(o) To begin, maintain or defend any litigation necessary in
connection with the administration of the Plan, except that the
Trustee is not obliged or required to do so unless indemnified
to its satisfaction.
[B] Nondiscretionary Trustee Designation/Appointment of
Custodian. If the Employer, in its Adoption Agreement Section
1.02, designates the Trustee to administer the Trust as a
nondiscretionary Trustee, then the Trustee will not have any
discretion or authority with regard to the investment of the
Trust Fund, but must act solely as a directed trustee of the
funds contributed to it. A nondiscretionary Trustee, as directed
trustee of the funds held by it under the Employer's Plan, is
authorized and empowered, by way of limitation, with the
following powers, rights and duties, each of which the
nondiscretionary Trustee exercises solely as directed trustee in
accordance with the written direction of the Named Fiduciary
(except to the extent a Plan asset is subject to the control and
management of a properly appointed Investment Manager or subject
to Advisory Committee or Participant direction of investment):
(a) To invest any part or all of the Trust Fund in any common
or preferred stocks, open-end or closed-end mutual funds, put
and call options traded on a national exchange, United States
retirement plan bonds, corporate bonds, debentures, convertible
debentures, commercial paper, U.S. Treasury bills, U.S.
Treasury notes and other direct or indirect obligations of the
United States Government or its agencies, improved or
unimproved real estate situated in the United States, limited
partnerships, insurance contracts of any type, mortgages, notes
or other property of any kind, real or personal, to buy or sell
options on common stock on a nationally recognized options
exchange with or without holding the underlying common stock,
to buy and sell commodities, commodity options and contracts
for the future delivery of commodities, and to make any other
investments the Named Fiduciary deems appropriate.
(b) To retain in cash so much of the Trust Fund as the Named
Fiduciary may direct in writing to satisfy liquidity needs of
the Plan and to deposit any cash held in the Trust Fund in a
bank account at reasonable interest, including, specific
authority to invest in any type of deposit of the Trustee (or
of a bank related to the Trustee within the meaning of Code
Section 414(b)) at a reasonable rate of interest.
(c) To sell, contract to sell, grant options to purchase,
convey, exchange, transfer, abandon, improve, repair, insure,
lease for any term even though commencing in the future or
extending beyond the term of the Trust, and otherwise deal with
all property, real or personal, in such manner, for such
considerations and on such terms and conditions as the Named
Fiduciary directs in writing.
(d) To credit and distribute the Trust as directed by the
Advisory Committee. The Trustee is not obliged to inquire as to
whether any payee or distributee is entitled to any payment or
whether the distribution is proper or within the terms of the
Plan, or as to the manner of making any payment or
distribution. The Trustee is accountable only to the Advisory
Committee for any payment or distribution made by it in good
faith on the order or direction of the Advisory Committee.
(e) To borrow money, to assume indebtedness, extend mortgages
and encumber by mortgage or pledge.
(f) To have with respect to the Trust all of the rights of an
individual owner, including the power to give proxies, to
participate in any voting trusts, mergers, consolidations or
liquidations, and to exercise or sell stock subscriptions or
conversion rights, provided the exercise of any such powers is
in accordance with and at the written direction of the Named
Fiduciary.
(g) To lease for oil, gas and other mineral purposes and to
create mineral severances by grant or reservation; to pool or
unitize interests in oil, gas and other minerals; and to enter
into operating agreements and to execute division and transfer
orders, provided the exercise of any such powers is in
accordance with and at the written direction of the Named
Fiduciary.
(h) To hold any securities or other property in the name of the
nondiscretionary Trustee or its nominee, with depositories or
agent depositories or in another form as the Named Fiduciary
may deem best, with or without disclosing the custodial
relationship.
(i) To retain any funds or property subject to any dispute
without liability for the payment of interest, and to decline
to make payment or delivery of the funds or property until a
court of competent jurisdiction makes final adjudication.
(j) To file all tax returns required of the Trustee.
(k) To furnish to the Named Fiduciary, the Employer, the Plan
Administrator and the Advisory Committee an annual statement of
account showing the condition of the Trust Fund and all
investments, receipts, disbursements and other transactions
effected by the nondiscretionary Trustee during the Plan Year
covered by the statement and also stating the assets of the
Trust held at the end of the Plan Year, which accounts are
conclusive on all persons, including the Named Fiduciary, the
Employer, the Plan Administrator and the Advisory Committee,
except as to any act or transaction concerning which the Named
Fiduciary, the Employer, the Plan Administrator or the Advisory
Committee files with the nondiscretionary Trustee written
exceptions or objections within 90 days after the receipt of
the accounts or for which XXXXX authorizes a longer period
within which to object.
(l) To begin, maintain or defend any litigation necessary in
connection with the administration of the Plan, except that the
Trustee is not obliged or required to do so unless indemnified
to its satisfaction.
Appointment of Custodian. The Employer may appoint a Custodian
under the Plan, the acceptance by the Custodian indicated on the
execution page of the Employer's Adoption Agreement. If the
Employer appoints a Custodian, the Employer's Plan must have a
discretionary Trustee, as described in Section 10.03[A]. A
Custodian has the same powers, rights and duties as a
nondiscretionary Trustee, as described in this Section 10.03[B].
The Custodian accepts the terms of the Plan and Trust by
executing the Employer's Adoption Agreement. Any reference in the
Plan to a Trustee also is a reference to a Custodian where the
context of the Plan dictates. A limitation of the Trustee's
liability by Plan provision also acts as a limitation of the
Custodian's liability. Any action taken by the Custodian at the
discretionary Trustee's direction satisfies any provision in the
Plan referring to the Trustee's taking that action.
Modification of Powers/Limited Responsibility. The Employer and
the Custodian or nondiscretionary Trustee, by letter agreement,
may limit the powers of the Custodian or nondiscretionary Trustee
to any combination of powers listed within this Section 10.03[B].
If there is a Custodian or a nondiscretionary Trustee under the
Employer's Plan, then the Employer, in adopting this Plan
acknowledges the Custodian or nondiscretionary Trustee has no
discretion with respect to the investment or re-investment of the
Trust Fund and that the Custodian or nondiscretionary Trustee is
acting solely as custodian or as directed trustee with respect to
the assets comprising the Trust Fund.
[C] Limitation of Powers of Certain Custodians. If a Custodian is
a bank which, under its governing state law, does not possess
trust powers, then paragraphs (a), (c), (e), (f), (g) of Section
10.03[B], Section 10.16 and Article XI do not apply to that bank
and that bank only has the power and authority to exercise the
remaining powers, rights and duties under Section 10.03[B].
[D] Named Fiduciary/Limitation of Liability of Nondiscretionary
Trustee or Custodian. Under a nondiscretionary Trustee
designation, the Named Fiduciary under the Employer's Plan has
the sole responsibility for the management and control of the
Employer's Trust Fund, except with respect to a Plan asset under
the control or direction of a properly appointed Investment
Manager or with respect to a Plan asset properly subject to
Participant or Advisory Committee direction of investment. If the
Employer appoints a Custodian, the Named Fiduciary is the
discretionary Trustee. Under a nondiscretionary Trustee
designation, unless the Employer designates in writing another
person or persons to serve as Named Fiduciary, the Named
Fiduciary under the Plan is the president of a corporate
Employer, the managing partner of a partnership Employer or the
sole proprietor, as appropriate. The Named Fiduciary will
exercise its management and control of the Trust Fund through its
written direction to the nondiscretionary Trustee or to the
Custodian, whichever applies to the Employer's Plan.
The nondiscretionary Trustee or Custodian has no duty to review
or to make recommendations regarding investments made at the
written direction of the Named Fiduciary. The nondiscretionary
Trustee or Custodian must retain any investment obtained at the
written direction of the Named Fiduciary until further directed
in writing by the Named Fiduciary to dispose of such investment.
The nondiscretionary Trustee or Custodian is not liable in any
manner or for any reason for making, retaining or disposing of
any investment pursuant to any written direction described in
this paragraph. Furthermore, the Employer agrees to indemnify and
to hold the nondiscretionary Trustee or Custodian harmless from
any damages, costs or expenses, including reasonable counsel
fees, which the nondiscretionary Trustee or Custodian may incur
as a result of any claim asserted against the nondiscretionary
Trustee, the Custodian or the Trust arising out of the
nondiscretionary Trustee's or Custodian's compliance with any
written direction described in this paragraph.
[E] Participant Loans. This Section 10.03[E] specifically
authorizes the Trustee to make loans on a nondiscriminatory basis
to a Participant or to a Beneficiary in accordance with the loan
policy established by the Advisory Committee, provided: (1) the
loan policy satisfies the requirements of Section 9.04; (2) loans
are available to all Participants and Beneficiaries on a
reasonably equivalent basis and are not available in a greater
amount for Highly Compensated Employees than for other Employees;
(3) any loan is adequately secured and bears a reasonable rate of
interest; (4) the loan provides for repayment within a specified
time; (5) the default provisions of the note prohibit offset of
the Participant's Nonforfeitable Accrued Benefit prior to the
time the Trustee otherwise would distribute the Participant's
Nonforfeitable Accrued Benefit; (6) the amount of the loan does
not exceed (at the time the Plan extends the loan) the present
value of the Participant's Nonforfeitable Accrued Benefit; and
(7) the loan otherwise conforms to the exemption provided by Code
Section 4975(d)(1). If the joint and survivor requirements of
Article VI apply to the Participant, the Participant may not
pledge any portion of his Accrued Benefit as security for a loan
made after August 18, 1985, unless, within the 90 day period
ending on the date the pledge becomes effective, the
Participant's spouse, if any, consents (in a manner described in
Section 6.05 other than the requirement relating to the consent
of a subsequent spouse) to the security or, by separate consent,
to an increase in the amount of security. If the Employer is an
unincorporated trade or business, a Participant who is an Owner-
Employee may not receive a loan from the Plan, unless he has
obtained a prohibited transaction exemption from the Department
of Labor. If the Employer is an "S Corporation," a Participant
who is a shareholder-employee (an employee or an officer) who, at
any time during the Employer's taxable year, owns more than 5%,
either directly or by attribution under Code Section 318(a)(1),
of the Employer's outstanding stock may not receive a loan from
the Plan, unless he has obtained a prohibited transaction
exemption from the Department of Labor. If the Employer is not an
unincorporated trade or business nor an "S Corporation," this
Section 10.03[E] does not impose any restrictions on the class of
Participants eligible for a loan from the Plan.
[F] Investment in qualifying Employer securities and qualifying
Employer real property. The investment options in this Section
10.03[F] include the ability to invest in qualifying Employer
securities or qualifying Employer real property, as defined in
and as limited by XXXXX. If the Employer's Plan is a
Nonstandardized profit sharing plan, it may elect in its Adoption
Agreement to permit the aggregate investments in qualifying
Employer securities and in qualifying Employer real property to
exceed 10% of the value of Plan assets.
10.04 RECORDS AND STATEMENTS. The records of the Trustee
----------------------
pertaining to the Plan must be open to the inspection of the Plan
Administrator, the Advisory Committee and the Employer at all
reasonable times and may be audited from time to time by any
person or persons as the Employer, Plan Administrator or Advisory
Committee may specify in writing. The Trustee must furnish the
Plan Administrator or Advisory Committee with whatever
information relating to the Trust Fund the Plan Administrator or
Advisory Committee considers necessary.
10.05 FEES AND EXPENSES FROM FUND. A Trustee or Custodian
---------------------------
will receive reasonable annual compensation as may be agreed upon
from time to time between the Employer and the Trustee or
Custodian. No person who is receiving full pay from the Employer
may receive compensation for services as Trustee or as Custodian.
The Trustee will pay from the Trust Fund all fees and expenses
reasonably incurred by the Plan, to the extent such fees and
expenses are for the ordinary and necessary administration and
operation of the Plan, unless the Employer pays such fees and
expenses. Any fee or expense paid, directly or indirectly, by the
Employer is not an Employer contribution to the Plan, provided
the fee or expense relates to the ordinary and necessary
administration of the Fund.
10.06 PARTIES TO LITIGATION. Except as otherwise provided by
---------------------
ERISA, no Participant or Beneficiary is a necessary party or is
required to receive notice of process in any court proceeding
involving the Plan, the Trust Fund or any fiduciary of the Plan.
Any final judgment entered in any proceeding will be conclusive
upon the Employer, the Plan Administrator, the Advisory
Committee, the Trustee, Custodian, Participants and Beneficiaries.
10.07 PROFESSIONAL AGENTS. The Trustee may employ and pay
-------------------
from the Trust Fund reasonable compensation to agents, attorneys,
accountants and other persons to advise the Trustee as in its
opinion may be necessary. The Trustee may delegate to any agent,
attorney, accountant or other person selected by it any
non-Trustee power or duty vested in it by the Plan, and the
Trustee may act or refrain from acting on the advice or opinion
of any agent, attorney, accountant or other person so selected.
10.08 DISTRIBUTION OF CASH OR PROPERTY. The Trustee may make
--------------------------------
distribution under the Plan in cash or property, or partly in
each, at its fair market value as determined by the Trustee. For
purposes of a distribution to a Participant or to a Participant's
designated Beneficiary or surviving spouse, "property" includes a
Nontransferable Annuity Contract, provided the contract satisfies
the requirements of this Plan.
10.09 DISTRIBUTION DIRECTIONS. If no one claims a payment or
-----------------------
distribution made from the Trust, the Trustee must promptly
notify the Advisory Committee and then dispose of the payment in
accordance with the subsequent direction of the Advisory
Committee.
10.10 THIRD PARTY/MULTIPLE TRUSTEES. No person dealing with
-----------------------------
the Trustee is obligated to see to the proper application of any
money paid or property delivered to the Trustee, or to inquire
whether the Trustee has acted pursuant to any of the terms of the
Plan. Each person dealing with the Trustee may act upon any
notice, request or representation in writing by the Trustee, or
by the Trustee's duly authorized agent, and is not liable to any
person in so acting. The certificate of the Trustee that it is
acting in accordance with the Plan will be conclusive in favor of
any person relying on the certificate. If more than two persons
act as Trustee, a decision of the majority of such persons
controls with respect to any decision regarding the
administration or investment of the Trust Fund or of any portion
of the Trust Fund with respect to which such persons act as
Trustee. However, the signature of only one Trustee is necessary
to effect any transaction on behalf of the Trust.
10.11 RESIGNATION. The Trustee or Custodian may resign its
-----------
position at any time by giving 30 days' written notice in advance
to the Employer and to the Advisory Committee. If the Employer
fails to appoint a successor Trustee within 60 days of its
receipt of the Trustee's written notice of resignation, the
Trustee will treat the Employer as having appointed itself as
Trustee and as having filed its acceptance of appointment with
the former Trustee. The Employer, in its sole discretion, may
replace a Custodian. If the Employer does not replace a
Custodian, the discretionary Trustee will assume possession of
Plan assets held by the former Custodian.
10.12 REMOVAL. The Employer, by giving 30 days' written
-------
notice in advance to the Trustee, may remove any Trustee or
Custodian. In the event of the resignation or removal of a
Trustee, the Employer must appoint a successor Trustee if it
intends to continue the Plan. If two or more persons hold the
position of Trustee, in the event of the removal of one such
person, during any period the selection of a replacement is
pending, or during any period such person is unable to serve for
any reason, the remaining person or persons will act as the
Trustee.
10.13 INTERIM DUTIES AND SUCCESSOR TRUSTEE. Each successor
------------------------------------
Trustee succeeds to the title to the Trust vested in his
predecessor by accepting in writing his appointment as successor
Trustee and by filing the acceptance with the former Trustee and
the Advisory Committee without the signing or filing of any
further statement. The resigning or removed Trustee, upon receipt
of acceptance in writing of the Trust by the successor Trustee,
must execute all documents and do all acts necessary to vest the
title of record in any successor Trustee. Each successor Trustee
has and enjoys all of the powers, both discretionary and
ministerial, conferred under this Agreement upon his predecessor.
A successor Trustee is not personally liable for any act or
failure to act of any predecessor Trustee, except as required
under ERISA. With the approval of the Employer and the Advisory
Committee, a successor Trustee, with respect to the Plan, may
accept the account rendered and the property delivered to it by a
predecessor Trustee without incurring any liability or
responsibility for so doing.
10.14 VALUATION OF TRUST. The Trustee must value the Trust
------------------
Fund as of each Accounting Date to determine the fair market
value of each Participant's Accrued Benefit in the Trust. The
Trustee also must value the Trust Fund on such other valuation
dates as directed in writing by the Advisory Committee or as
required by the Employer's Adoption Agreement.
10.15 LIMITATION ON LIABILITY - IF INVESTMENT MANAGER,
------------------------------------------------
ANCILLARY TRUSTEE OR INDEPENDENT FIDUCIARY APPOINTED. The Trustee
----------------------------------------------------
is not liable for the acts or omissions of any Investment Manager
the Advisory Committee may appoint, nor is the Trustee under any
obligation to invest or otherwise manage any asset of the Plan
which is subject to the management of a properly appointed
Investment Manager. The Advisory Committee, the Trustee and any
properly appointed Investment Manager may execute a letter
agreement as a part of this Plan delineating the duties,
responsibilities and liabilities of the Investment Manager with
respect to any part of the Trust Fund under the control of the
Investment Manager.
The limitation on liability described in this Section 10.15
also applies to the acts or omissions of any ancillary trustee or
independent fiduciary properly appointed under Section 10.17 of
the Plan. However, if a discretionary Trustee, pursuant to the
delegation described in Section 10.17 of the Plan, appoints an
ancillary trustee, the discretionary Trustee is responsible for
the periodic review of the ancillary trustee's actions and must
exercise its delegated authority in accordance with the terms of
the Plan and in a manner consistent with ERISA. The Employer, the
discretionary Trustee and an ancillary trustee may execute a
letter agreement as a part of this Plan delineating any
indemnification agreement between the parties.
10.16 INVESTMENT IN GROUP TRUST FUND. The Employer, by
------------------------------
adopting this Plan, specifically authorizes the Trustee to invest
all or any portion of the assets comprising the Trust Fund in any
group trust fund which at the time of the investment provides for
the pooling of the assets of plans qualified under Code Section
401(a). This authorization applies solely to a group trust fund
exempt from taxation under Code Section 501(a) and the trust
agreement of which satisfies the requirements of Revenue Ruling
81-100. The provisions of the group trust fund agreement, as
amended from time to time, are by this reference incorporated
within this Plan and Trust. The provisions of the group trust
fund will govern any investment of Plan assets in that fund. The
Employer must specify in an attachment to its adoption agreement
the group trust fund(s) to which this authorization applies. If
the Trustee is acting as a nondiscretionary Trustee, the
investment in the group trust fund is available only in
accordance with a proper direction, by the Named Fiduciary, in
accordance with Section 10.03[B]. Pursuant to paragraph (c) of
Section 10.03[A] of the Plan, a Trustee has the authority to
invest in certain common trust funds and collective investment
funds without the need for the authorizing addendum described in
this Section 10.16.
Furthermore, at the Employer's direction, the Trustee, for
collective investment purposes, may combine into one trust fund
the Trust created under this Plan with the Trust created under
any other qualified retirement plan the Employer maintains.
However, the Trustee must maintain separate records of account
for the assets of each Trust in order to reflect properly each
Participant's Accrued Benefit under the plan(s) in which he is a
Participant.
10.17 APPOINTMENT OF ANCILLARY TRUSTEE OR INDEPENDENT
-----------------------------------------------
FIDUCIARY. The Employer, in writing, may appoint any person in
---------
any State to act as ancillary trustee with respect to a
designated portion of the Trust Fund, subject to the consent
required under Section 1.02 if the Master Plan Sponsor is a
financial institution. An ancillary trustee must acknowledge in
writing its acceptance of the terms and conditions of its
appointment as ancillary trustee and its fiduciary status under
ERISA. The ancillary trustee has the rights, powers, duties and
discretion as the Employer may delegate, subject to any
limitations or directions specified in the instrument evidencing
appointment of the ancillary trustee and to the terms of the Plan
or of ERISA. The investment powers delegated to the ancillary
trustee may include any investment powers available under Section
10.03 of the Plan including the right to invest any portion of
the assets of the Trust Fund in a common trust fund, as described
in Code Section 584, or in any collective investment fund, the
provisions of which govern the investment of such assets and
which the Plan incorporates by this reference, but only if the
ancillary trustee is a bank or similar financial institution
supervised by the United States or by a State and the ancillary
trustee (or its affiliate, as defined in Code Section 1504)
maintains the common trust fund or collective investment fund
exclusively for the collective investment of money contributed by
the ancillary trustee (or its affiliate) in a trustee capacity
and which conforms to the rules of the Comptroller of the
Currency. The Employer also may appoint as an ancillary trustee,
the trustee of any group trust fund designated for investment
pursuant to the provisions of Section 10.16 of the Plan.
The ancillary trustee may resign its position at any time by
providing at least 30 days' advance written notice to the
Employer, unless the Employer waives this notice requirement. The
Employer, in writing, may remove an ancillary trustee at any
time. In the event of resignation or removal, the Employer may
appoint another ancillary trustee, return the assets to the
control and management of the Trustee or receive such assets in
the capacity of ancillary trustee. The Employer may delegate its
responsibilities under this Section 10.17 to a discretionary
Trustee under the Plan, but not to a nondiscretionary Trustee or
to a Custodian, subject to the acceptance by the discretionary
Trustee of that delegation.
If the U.S. Department of Labor ("the Department") requires
engagement of an independent fiduciary to have control or
management of all or a portion of the Trust Fund, the Employer
will appoint such independent fiduciary, as directed by the
Department. The independent fiduciary will have the duties,
responsibilities and powers prescribed by the Department and will
exercise those duties, responsibilities and powers in accordance
with the terms, restrictions and conditions established by the
Department and, to the extent not inconsistent with ERISA, the
terms of the Plan. The independent fiduciary must accept its
appointment in writing and must acknowledge its status as a
fiduciary of the Plan.
* * * * * * * * * * * * * * *
ARTICLE XI
PROVISIONS RELATING TO INSURANCE AND INSURANCE COMPANY
11.01 INSURANCE BENEFIT. The Employer may elect to provide
-----------------
incidental life insurance benefits for insurable Participants who
consent to life insurance benefits by signing the appropriate
insurance company application form. The Trustee will not purchase
any incidental life insurance benefit for any Participant prior
to an allocation to the Participant's Account. At an insured
Participant's written direction, the Trustee will use all or any
portion of the Participant's nondeductible voluntary
contributions, if any, to pay insurance premiums covering the
Participant's life. This Section 11.01 also authorizes the
purchase of life insurance, for the benefit of the Participant,
on the life of a family member of the Participant or on any
person in whom the Participant has an insurable interest.
However, if the policy is on the joint lives of the Participant
and another person, the Trustee may not maintain that policy if
that other person predeceases the Participant.
The Employer will direct the Trustee as to the insurance
company and insurance agent through which the Trustee is to
purchase the insurance contracts, the amount of the coverage and
the applicable dividend plan. Each application for a policy, and
the policies themselves, must designate the Trustee as sole
owner, with the right reserved to the Trustee to exercise any
right or option contained in the policies, subject to the terms
and provisions of this Agreement. The Trustee must be the named
beneficiary for the Account of the insured Participant. Proceeds
of insurance contracts paid to the Participant's Account under
this Article XI are subject to the distribution requirements of
Article V and of Article VI. The Trustee will not retain any such
proceeds for the benefit of the Trust.
The Trustee will charge the premiums on any incidental benefit
insurance contract covering the life of a Participant against the
Account of that Participant. The Trustee will hold all incidental
benefit insurance contracts issued under the Plan as assets of
the Trust created under the Plan.
(A) Incidental insurance benefits. The aggregate of life
insurance premiums paid for the benefit of a Participant, at all
times, may not exceed the following percentages of the aggregate
of the Employer's contributions allocated to any Participant's
Account: (i) 49% in the case of the purchase of ordinary life
insurance contracts; or (ii) 25% in the case of the purchase of
term life insurance or universal life insurance contracts. If the
Trustee purchases a combination of ordinary life insurance
contract(s) and term life insurance or universal life insurance
contract(s), then the sum of one-half of the premiums paid for
the ordinary life insurance contract(s) and the premiums paid for
the term life insurance or universal life insurance contract(s)
may not exceed 25% of the Employer contributions allocated to any
Participant's Account.
(B) Exception for certain profit sharing plans. If the Employer's
Plan is a profit sharing plan, the incidental insurance benefits
requirement does not apply to the Plan if the Plan purchases life
insurance benefits only from Employer contributions accumulated
in the Participant's Account for at least two years (measured
from the allocation date).
11.02 LIMITATION ON LIFE INSURANCE PROTECTION. The Trustee
---------------------------------------
will not continue any life insurance protection for any
Participant beyond his annuity starting date (as defined in
Article VI). If the Trustee holds any incidental benefit
insurance contract(s) for the benefit of a Participant when he
terminates his employment (other than by reason of death), the
Trustee must proceed as follows:
(a) If the entire cash value of the contract(s) is vested in
the terminating Participant, or if the contract(s) will have no
cash value at the end of the policy year in which termination
of employment occurs, the Trustee will transfer the contract(s)
to the Participant endorsed so as to vest in the transferee all
right, title and interest to the contract(s), free and clear of
the Trust; subject however, to restrictions as to surrender or
payment of benefits as the issuing insurance company may permit
and as the Advisory Committee directs;
(b) If only part of the cash value of the contract(s) is vested
in the terminating Participant, the Trustee, to the extent the
Participant's interest in the cash value of the contract(s) is
not vested, may adjust the Participant's interest in the value
of his Account attributable to Trust assets other than
incidental benefit insurance contracts and proceed as in (a),
or the Trustee must effect a loan from the issuing insurance
company on the sole security of the contract(s) for an amount
equal to the difference between the cash value of the
contract(s) at the end of the policy year in which termination
of employment occurs and the amount of the cash value that is
vested in the terminating Participant, and the Trustee must
transfer the contract(s) endorsed so as to vest in the
transferee all right, title and interest to the contract(s),
free and clear of the Trust; subject however, to the
restrictions as to surrender or payment of benefits as the
issuing insurance company may permit and the Advisory Committee
directs;
(c) If no part of the cash value of the contract(s) is vested
in the terminating Participant, the Trustee must surrender the
contract(s) for cash proceeds as may be available.
In accordance with the written direction of the Advisory
Committee, the Trustee will make any transfer of contract(s)
under this Section 11.02 on the Participant's annuity starting
date (or as soon as administratively practicable after that
date). The Trustee may not transfer any contract under this
Section 11.02 which contains a method of payment not specifically
authorized by Article VI or which fails to comply with the joint
and survivor annuity requirements, if applicable, of Article VI.
In this regard, the Trustee either must convert such a contract
to cash and distribute the cash instead of the contract, or
before making the transfer, require the issuing company to delete
the unauthorized method of payment option from the contract.
11.03 DEFINITIONS. For purposes of this Article XI:
-----------
(a) "Policy" means an ordinary life insurance contract or a
term life insurance contract issued by an insurer on the life
of a Participant.
(b) "Issuing insurance company" is any life insurance company
which has issued a policy upon application by the Trustee under
the terms of this Agreement.
(c) "Contract" or "Contracts" means a policy of insurance. In
the event of any conflict between the provisions of this Plan
and the terms of any contract or policy of insurance issued in
accordance with this Article XI, the provisions of the Plan
control.
(d) "Insurable Participant" means a Participant to whom an
insurance company, upon an application being submitted in
accordance with the Plan, will issue insurance coverage,
either as a standard risk or as a risk in an extra mortality
classification.
11.04 DIVIDEND PLAN. The dividend plan is premium reduction
-------------
unless the Advisory Committee directs the Trustee to the contrary.
The Trustee must use all dividends for a contract to purchase
insurance benefits or additional insurance benefits for the
Participant on whose life the insurance company has issued the
contract. Furthermore, the Trustee must arrange, where possible,
for all policies issued on the lives of Participants under the
Plan to have the same premium due date and all ordinary life
insurance contracts to contain guaranteed cash values with as
uniform basic options as are possible to obtain. The term "
dividends" includes policy dividends, refunds of premiums and
other credits.
11.05 INSURANCE COMPANY NOT A PARTY TO AGREEMENT. No
------------------------------------------
insurance company, solely in its capacity as an issuing insurance
company, is a party to this Agreement nor is the company
responsible for its validity.
11.06 INSURANCE COMPANY NOT RESPONSIBLE FOR TRUSTEE'S ACTIONS.
-------------------------------------------------------
No insurance company, solely in its capacity as an issuing
insurance company, need examine the terms of this Agreement nor is
responsible for any action taken by the Trustee.
11.07 INSURANCE COMPANY RELIANCE ON TRUSTEE'S SIGNATURE. For
-------------------------------------------------
the purpose of making application to an insurance company and in
the exercise of any right or option contained in any policy, the
insurance company may rely upon the signature of the Trustee and
is saved harmless and completely discharged in acting at the
direction and authorization of the Trustee.
11.08 ACQUITTANCE. An insurance company is discharged from
-----------
all liability for any amount paid to the Trustee or paid in
accordance with the direction of the Trustee, and is not obliged
to see to the distribution or further application of any moneys
it so pays.
11.09 DUTIES OF INSURANCE COMPANY. Each insurance company
---------------------------
must keep such records, make such identification of contracts,
funds and accounts within funds, and supply such information as
may be necessary for the proper administration of the Plan under
which it is carrying insurance benefits.
Note: The provisions of this Article XI are not applicable, and
the Plan may not invest in insurance contracts, if a Custodian
signatory to the Adoption Agreement is a bank which has not
acquired trust powers from its governing state banking authority.
* * * * * * * * * * * * * * *
ARTICLE XII
MISCELLANEOUS
12.01 EVIDENCE. Anyone required to give evidence under the
--------
terms of the Plan may do so by certificate, affidavit, document
or other information which the person to act in reliance may
consider pertinent, reliable and genuine, and to have been
signed, made or presented by the proper party or parties. The
Advisory Committee and the Trustee are fully protected in acting
and relying upon any evidence described under the immediately
preceding sentence.
12.02 NO RESPONSIBILITY FOR EMPLOYER ACTION. Neither the
-------------------------------------
Trustee nor the Advisory Committee has any obligation or
responsibility with respect to any action required by the Plan to
be taken by the Employer, any Participant or eligible Employee,
or for the failure of any of the above persons to act or make any
payment or contribution, or to otherwise provide any benefit
contemplated under this Plan. Furthermore, the Plan does not
require the Trustee or the Advisory Committee to collect any
contribution required under the Plan, or to determine the
correctness of the amount of any Employer contribution. Neither
the Trustee nor the Advisory Committee need inquire into or be
responsible for any action or failure to act on the part of the
others, or on the part of any other person who has any
responsibility regarding the management, administration or
operation of the Plan, whether by the express terms of the Plan
or by a separate agreement authorized by the Plan or by the
applicable provisions of ERISA. Any action required of a
corporate Employer must be by its Board of Directors or its
designate.
12.03 FIDUCIARIES NOT INSURERS. The Trustee, the Advisory
------------------------
Committee, the Plan Administrator and the Employer in no way
guarantee the Trust Fund from loss or depreciation. The Employer
does not guarantee the payment of any money which may be or
becomes due to any person from the Trust Fund. The liability of
the Advisory Committee and the Trustee to make any payment from
the Trust Fund at any time and all times is limited to the then
available assets of the Trust.
12.04 WAIVER OF NOTICE. Any person entitled to notice under
----------------
the Plan may waive the notice, unless the Code or Treasury
regulations prescribe the notice or ERISA specifically or
impliedly prohibits such a waiver.
12.05 SUCCESSORS. The Plan is binding upon all persons
----------
entitled to benefits under the Plan, their respective heirs and
legal representatives, upon the Employer, its successors and
assigns, and upon the Trustee, the Advisory Committee, the Plan
Administrator and their successors.
12.06 WORD USAGE. Words used in the masculine also apply to
----------
the feminine where applicable, and wherever the context of the
Employer's Plan dictates, the plural includes the singular and
the singular includes the plural.
12.07 STATE LAW. The law of the state of the Employer's
---------
principal place of business (unless otherwise designated in an
addendum to the Employer's Adoption Agreement) will determine all
questions arising with respect to the provisions of this
Agreement except to the extent superseded by Federal law.
12.08 EMPLOYER'S RIGHT TO PARTICIPATE. If the Employer's Plan
-------------------------------
fails to qualify or to maintain qualification or if the Employer
makes any amendment or modification to a provision of this Plan
(other than a proper completion of an elective provision under
the Adoption Agreement or the attachment of an addendum
authorized by the Plan or by the Adoption Agreement), the
Employer may no longer participate under this Master Plan. The
Employer also may not participate (or continue to participate) in
this Master Plan if the Trustee or Custodian (or a change in the
Trustee or Custodian) does not satisfy the requirements of
Section 1.02 of the Plan. If the Employer is not entitled to
participate under this Master Plan, the Employer's Plan is an
individually-designed plan and the reliance procedures specified
in the applicable Adoption Agreement no longer will apply.
12.09 EMPLOYMENT NOT GUARANTEED. Nothing contained in this
-------------------------
Plan, or with respect to the establishment of the Trust, or any
modification or amendment to the Plan or Trust, or in the
creation of any Account, or the payment of any benefit, gives any
Employee, Employee-Participant or any Beneficiary any right to
continue employment, any legal or equitable right against the
Employer, or Employee of the Employer, or against the Trustee, or
its agents or employees, or against the Plan Administrator,
except as expressly provided by the Plan, the Trust, ERISA or by
a separate agreement.
* * * * * * * * * * * * * * *
ARTICLE XIII
EXCLUSIVE BENEFIT, AMENDMENT, TERMINATION
13.01 EXCLUSIVE BENEFIT. Except as provided under Article
-----------------
III, the Employer has no beneficial interest in any asset of the
Trust and no part of any asset in the Trust may ever revert to or
be repaid to an Employer, either directly or indirectly; nor,
prior to the satisfaction of all liabilities with respect to the
Participants and their Beneficiaries under the Plan, may any part
of the corpus or income of the Trust Fund, or any asset of the
Trust, be (at any time) used for, or diverted to, purposes other
than the exclusive benefit of the Participants or their
Beneficiaries. However, if the Commissioner of Internal Revenue,
upon the Employer's request for initial approval of this Plan,
determines the Trust created under the Plan is not a qualified
trust exempt from Federal income tax, then (and only then) the
Trustee, upon written notice from the Employer, will return the
Employer's contributions (and increment attributable to the
contributions) to the Employer. The Trustee must make the return
of the Employer contribution under this Section 13.01 within one
year of a final disposition of the Employer's request for initial
approval of the Plan. The Employer's Plan and Trust will
terminate upon the Trustee's return of the Employer's
contributions.
13.02 AMENDMENT BY EMPLOYER. The Employer has the right at
-----------------------
any time and from time to time:
(a) To amend the elective provisions of the Adoption Agreement
in any manner it deems necessary or advisable in order to
qualify (or maintain qualification of) this Plan and the Trust
created under it under the provisions of Code Section 401(a);
(b) To amend the Plan to allow the Plan to operate under a
waiver of the minimum funding requirement; and
(c) To amend this Agreement in any other manner.
No amendment may authorize or permit any of the Trust Fund
(other than the part which is required to pay taxes and
administration expenses) to be used for or diverted to purposes
other than for the exclusive benefit of the Participants or their
Beneficiaries or estates. No amendment may cause or permit any
portion of the Trust Fund to revert to or become a property of
the Employer. The Employer also may not make any amendment which
affects the rights, duties or responsibilities of the Trustee,
the Plan Administrator or the Advisory Committee without the
written consent of the affected Trustee, the Plan Administrator
or the affected member of the Advisory Committee. The Employer
must make all amendments in writing. Each amendment must state
the date to which it is either retroactively or prospectively
effective. See Section 12.08 for the effect of certain amendments
adopted by the Employer.
(A) Code Section 411(d)(6) protected benefits. An amendment
(including the adoption of this Plan as a restatement of an
existing plan) may not decrease a Participant's Accrued Benefit,
except to the extent permitted under Code Section 412(c)(8), and
may not reduce or eliminate Code Section 411(d)(6) protected
benefits determined immediately prior to the adoption date (or,
if later, the effective date) of the amendment. An amendment
reduces or eliminates Code Section 411(d)(6) protected benefits
if the amendment has the effect of either (1) eliminating or
reducing an early retirement benefit or a retirement-type subsidy
(as defined in Treasury regulations), or (2) except as provided
by Treasury regulations, eliminating an optional form of benefit.
The Advisory Committee must disregard an amendment to the extent
application of the amendment would fail to satisfy this
paragraph. If the Advisory Committee must disregard an amendment
because the amendment would violate clause (1) or clause (2), the
Advisory Committee must maintain a schedule of the early
retirement option or other optional forms of benefit the Plan
must continue for the affected Participants.
13.03 AMENDMENT BY MASTER PLAN SPONSOR. The Master Plan
--------------------------------
Sponsor (or PPD, as agent of the Master Plan Sponsor), without
the Employer's consent, may amend the Plan and Trust, from time
to time, in order to conform the Plan and Trust to any
requirement for qualification of the Plan and Trust under the
Internal Revenue Code. The Master Plan Sponsor may not amend the
Plan in any manner which would modify any election made by the
Employer under the Plan without the Employer's written consent.
Furthermore, the Master Plan Sponsor may not amend the Plan in
any manner which would violate the proscription of Section 13.02.
A Trustee does not have the power to amend the Plan or Trust.
13.04 DISCONTINUANCE. The Employer has the right, at any
--------------
time, to suspend or discontinue its contributions under the Plan,
and to terminate, at any time, this Plan and the Trust created
under this Agreement. The Plan will terminate upon the first to
occur of the following:
(a) The date terminated by action of the Employer;
(b) The dissolution or merger of the Employer, unless the
successor makes provision to continue the Plan, in which event
the successor must substitute itself as the Employer under this
Plan. Any termination of the Plan resulting from this paragraph
(b) is not effective until compliance with any applicable
notice requirements under ERISA.
13.05 FULL VESTING ON TERMINATION. Upon either full or
---------------------------
partial termination of the Plan, or, if applicable, upon complete
discontinuance of profit sharing plan contributions to the Plan,
an affected Participant's right to his Accrued Benefit is 100%
Nonforfeitable, irrespective of the Nonforfeitable percentage
which otherwise would apply under Article V.
13.06 MERGER/DIRECT TRANSFER. The Trustee may not consent to,
----------------------
or be a party to, any merger or consolidation with another plan,
or to a transfer of assets or liabilities to another plan, unless
immediately after the merger, consolidation or transfer, the
surviving Plan provides each Participant a benefit equal to or
greater than the benefit each Participant would have received had
the Plan terminated immediately before the merger or
consolidation or transfer. The Trustee possesses the specific
authority to enter into merger agreements or direct transfer of
assets agreements with the trustees of other retirement plans
described in Code Section 401(a), including an elective transfer,
and to accept the direct transfer of plan assets, or to transfer
plan assets, as a party to any such agreement.
The Trustee may accept a direct transfer of plan assets on
behalf of an Employee prior to the date the Employee satisfies
the Plan's eligibility conditions. If the Trustee accepts such a
direct transfer of plan assets, the Advisory Committee and
Trustee must treat the Employee as a Participant for all purposes
of the Plan except the Employee is not a Participant for purposes
of sharing in Employer contributions or Participant forfeitures
under the Plan until he actually becomes a Participant in the
Plan.
(A) Elective transfers. The Trustee, after August 9, 1988, may
not consent to, or be a party to a merger, consolidation or
transfer of assets with a defined benefit plan, except with
respect to an elective transfer, or unless the transferred
benefits are in the form of paid-up individual annuity contracts
guaranteeing the payment of the transferred benefits in
accordance with the terms of the transferor plan and in a manner
consistent with the Code and with ERISA. The Trustee will hold,
administer and distribute the transferred assets as a part of the
Trust Fund and the Trustee must maintain a separate Employer
contribution Account for the benefit of the Employee on whose
behalf the Trustee accepted the transfer in order to reflect the
value of the transferred assets. Unless a transfer of assets to
this Plan is an elective transfer, the Plan will preserve all
Code Section 411(d)(6) protected benefits with respect to those
transferred assets, in the manner described in Section 13.02. A
transfer is an elective transfer if: (1) the transfer satisfies
the first paragraph of this Section 13.06; (2) the transfer is
voluntary, under a fully informed election by the Participant;
(3) the Participant has an alternative that retains his Code
Section 411(d)(6) protected benefits (including an option to
leave his benefit in the transferor plan, if that plan is not
terminating); (4) the transfer satisfies the applicable spousal
consent requirements of the Code; (5) the transferor plan
satisfies the joint and survivor notice requirements of the Code,
if the Participant's transferred benefit is subject to those
requirements; (6) the Participant has a right to immediate
distribution from the transferor plan, in lieu of the elective
transfer; (7) the transferred benefit is at least the greater of
the single sum distribution provided by the transferor plan for
which the Participant is eligible or the present value of the
Participant's accrued benefit under the transferor plan payable
at that plan's normal retirement age; (8) the Participant has a
100% Nonforfeitable interest in the transferred benefit; and (9)
the transfer otherwise satisfies applicable Treasury regulations.
An elective transfer may occur between qualified plans of any
type. Any direct transfer of assets from a defined benefit plan
after August 9, 1988, which does not satisfy the requirements of
this paragraph will render the Employer's Plan individually-
designed. See Section 12.08.
(B) Distribution restrictions under Code Section 401(k). If the
Plan receives a direct transfer (by merger or otherwise) of
elective contributions (or amounts treated as elective
contributions) under a Plan with a Code Section 401(k)
arrangement, the distribution restrictions of Code Section
Section 401(k)(2) and (10) continue to apply to those transferred
elective contributions.
13.07 TERMINATION.
-----------
(A) Procedure. Upon termination of the Plan, the distribution
provisions of Article VI remain operative, with the following
exceptions:
(1) if the present value of the Participant's Nonforfeitable
Accrued Benefit does not exceed $3,500, the Advisory Committee
will direct the Trustee to distribute the Participant's
Nonforfeitable Accrued Benefit to him in lump sum as soon as
administratively practicable after the Plan terminates; and
(2) if the present value of the Participant's Nonforfeitable
Accrued Benefit exceeds $3,500, the Participant or the
Beneficiary, in addition to the distribution events permitted
under Article VI, may elect to have the Trustee commence
distribution of his Nonforfeitable Accrued Benefit as soon as
administratively practicable after the Plan terminates.
To liquidate the Trust, the Advisory Committee will purchase a
deferred annuity contract for each Participant which protects the
Participant's distribution rights under the Plan, if the
Participant's Nonforfeitable Accrued Benefit exceeds $3,500 and
the Participant does not elect an immediate distribution pursuant
to Paragraph (2).
If the Employer's Plan is a profit sharing plan, in lieu of the
preceding provisions of this Section 13.07 and the distribution
provisions of Article VI, the Advisory Committee will direct the
Trustee to distribute each Participant's Nonforfeitable Accrued
Benefit, in lump sum, as soon as administratively practicable
after the termination of the Plan, irrespective of the present
value of the Participant's Nonforfeitable Accrued Benefit and
whether the Participant consents to that distribution. This
paragraph does not apply if: (1) the Plan provides an annuity
option; or (2) as of the period between the Plan termination date
and the final distribution of assets, the Employer maintains any
other defined contribution plan (other than an ESOP). The
Employer, in an addendum to its Adoption Agreement numbered
13.07, may elect not to have this paragraph apply.
The Trust will continue until the Trustee in accordance with
the direction of the Advisory Committee has distributed all of
the benefits under the Plan. On each valuation date, the Advisory
Committee will credit any part of a Participant's Accrued Benefit
retained in the Trust with its proportionate share of the Trust's
income, expenses, gains and losses, both realized and unrealized.
Upon termination of the Plan, the amount, if any, in a suspense
account under Article III will revert to the Employer, subject to
the conditions of the Treasury regulations permitting such a
reversion. A resolution or amendment to freeze all future benefit
accrual but otherwise to continue maintenance of this Plan, is
not a termination for purposes of this Section 13.07.
(B) Distribution restrictions under Code Section 401(k). If the
Employer's Plan includes a Code Section 401(k) arrangement or if
transferred assets described in Section 13.06 are subject to the
distribution restrictions of Code Section Section 401(k)(2) and
(10), the special distribution provisions of this Section 13.07
are subject to the restrictions of this paragraph. The portion of
the Participant's Nonforfeitable Accrued Benefit attributable to
elective contributions (or to amounts treated under the Code
Section 401(k) arrangement as elective contributions) is not
distributable on account of Plan termination, as described in
this Section 13.07, unless: (a) the Participant otherwise is
entitled under the Plan to a distribution of that portion of his
Nonforfeitable Accrued Benefit; or (b) the Plan termination
occurs without the establishment of a successor plan. A
successor plan under clause (b) is a defined contribution plan
(other than an ESOP) maintained by the Employer (or by a related
employer) at the time of the termination of the Plan or within
the period ending twelve months after the final distribution of
assets. A distribution made after March 31, 1988, pursuant to
clause (b), must be part of a lump sum distribution to the
Participant of his Nonforfeitable Accrued Benefit.
* * * * * * * * * * * * * * *
ARTICLE XIV
CODE Section 401(k) AND CODE Section 401(m) ARRANGEMENTS
14.01 APPLICATION. This Article XIV applies to an Employer's
-----------
Plan only if the Employer is maintaining its Plan under a Code
Section 401(k) Adoption Agreement.
14.02 CODE SECTION 401(k) ARRANGEMENT. The Employer will
-------------------------------
elect in Section 3.01 of its Adoption Agreement the terms of the
Code Section 401(k) arrangement, if any, under the Plan. If the
Employer's Plan is a Standardized Plan, the Code Section 401(k)
arrangement must be a salary reduction arrangement. If the
Employer's Plan is a Nonstandardized Plan, the Code Section
401(k) arrangement may be a salary reduction arrangement or a
cash or deferred arrangement.
(A) Salary Reduction Arrangement. If the Employer elects a
salary reduction arrangement, any Employee eligible to
participate in the Plan may file a salary reduction agreement
with the Advisory Committee. The salary reduction agreement may
not be effective earlier than the following date which occurs
last: (i) the Employee's Plan Entry Date (or, in the case of a
reemployed Employee, his reparticipation date under Article II);
(ii) the execution date of the Employee's salary reduction
agreement; (iii) the date the Employer adopts the Code Section
401(k) arrangement by executing the Adoption Agreement; or (iv)
the effective date of the Code Section 401(k) arrangement, as
specified in the Employer's Adoption Agreement. Regarding clause
(i), an Employee subject to the Break in Service rule of Section
2.03(B) of the Plan may not enter into a salary reduction
agreement until the Employee has completed a sufficient number of
Hours of Service to receive credit for a Year of Service (as
defined in Section 2.02) following his reemployment commencement
date. A salary reduction agreement must specify the amount of
Compensation (as defined in Section 1.12) or percentage of
Compensation the Employee wishes to defer. The salary reduction
agreement will apply only to Compensation which becomes currently
available to the Employee after the effective date of the salary
reduction agreement. The Employer will apply a reduction election
to all Compensation (and to increases in such Compensation)
unless the Employee specifies in his salary reduction agreement
to limit the election to certain Compensation. The Employer will
specify in Adoption Agreement Section 3.01 the rules and
restrictions applicable to the Employees salary reduction
agreements.
(B) Cash or deferred arrangement. If the Employer elects a cash
or deferred arrangement, a Participant may elect to make a cash
election against his proportionate share of the Employer's Cash
or Deferred Contribution, in accordance with the Employer's
elections in Adoption Agreement Section 3.01. A Participant's
proportionate share of the Employer's Cash or Deferred
Contribution is the percentage of the total Cash or Deferred
Contribution which bears the same ratio that the Participant's
Compensation for the Plan Year bears to the total Compensation of
all Participants for the Plan Year. For purposes of determining
each Participant's proportionate share of the Cash or Deferred
Contribution, a Participant's Compensation is his Compensation as
determined under Section 1.12 of the Plan (as modified by Section
3.06 for allocation purposes), excluding any effect the
proportionate share may have on the Participant's Compensation
for the Plan Year. The Advisory Committee will determine the
proportionate share prior to the Employer's actual contribution
to the Trust, to provide the Participants the opportunity to file
cash elections. The Employer will pay directly to the Participant
the portion of his proportionate share the Participant has
elected to receive in cash.
(C) Election not to participate. A Participant's or Employee's
election not to participate, pursuant to Section 2.06, includes
his right to enter into a salary reduction agreement or to share
in the allocation of a Cash or Deferred Contribution, unless the
Participant or Employee limits the effect of the election to the
non-401(k) portions of the Plan.
14.03 DEFINITIONS. For purposes of this Article XIV:
-----------
(a) "Highly Compensated Employee" means an Eligible
Employee who satisfies the definition in Section 1.09 of the
Plan. Family members aggregated as a single Employee under
Section 1.09 constitute a single Highly Compensated
Employee, whether a particular family member is a Highly
Compensated Employee or a Nonhighly Compensated Employee
without the application of family aggregation.
(b) "Nonhighly Compensated Employee" means an Eligible
Employee who is not a Highly Compensated Employee and who is
not a family member treated as a Highly Compensated Employee.
(c) "Eligible Employee" means, for purposes of the ADP test
described in Section 14.08, an Employee who is eligible to
enter into a salary reduction agreement for the Plan Year,
irrespective of whether he actually enters into such an
agreement, and a Participant who is eligible for an
allocation of the Employer's Cash or Deferred Contribution
for the Plan Year. For purposes of the ACP test described in
Section 14.09, an "Eligible Employee" means a Participant
who is eligible to receive an allocation of matching
contributions (or would be eligible if he made the type of
contributions necessary to receive an allocation of matching
contributions) and a Participant who is eligible to make
nondeductible contributions, irrespective of whether he
actually makes nondeductible contributions. An Employee
continues to be an Eligible Employee during a period the
Plan suspends the Employee's right to make elective
deferrals or nondeductible contributions following a
hardship distribution.
(d) "Highly Compensated Group" means the group of Eligible
Employees who are Highly Compensated Employees for the Plan
Year.
(e) "Nonhighly Compensated Group" means the group of
Eligible Employees who are Nonhighly Compensated Employees
for the Plan Year.
(f) "Compensation" means, except as specifically provided
in this Article XIV, Compensation as defined for
nondiscrimination purposes in Section 1.12(B) of the Plan.
To compute an Employee's ADP or ACP, the Advisory Committee
may limit Compensation taken into account to Compensation
received only for the portion of the Plan Year in which the
Employee was an Eligible Employee and only for the portion
of the Plan Year in which the Plan or the Code Section
401(k) arrangement was in effect.
(g) "Deferral contributions" are Salary Reduction
Contributions and Cash or Deferred Contributions the
Employer contributes to the Trust on behalf of an Eligible
Employee, irrespective of whether, in the case of Cash or
Deferred Contributions, the contribution is at the election
of the Employee. For Salary Reduction Contributions, the
terms "deferral contributions" and "elective deferrals" have
the same meaning.
(h) "Elective deferrals" are all Salary Reduction
Contributions and that portion of any Cash or Deferred
Contribution which the Employer contributes to the Trust at
the election of an Eligible Employee. Any portion of a Cash
or Deferred Contribution contributed to the Trust because of
the Employee's failure to make a cash election is an
elective deferral. However, any portion of a Cash or
Deferred Contribution over which the Employee does not have
a cash election is not an elective deferral. Elective
deferrals do not include amounts which have become currently
available to the Employee prior to the election nor amounts
designated as nondeductible contributions at the time of
deferral or contribution.
(i) "Matching contributions" are contributions made by the
Employer on account of elective deferrals under a Code
Section 401(k) arrangement or on account of employee
contributions. Matching contributions also include
Participant forfeitures allocated on account of such
elective deferrals or employee contributions.
(j) "Nonelective contributions" are contributions made by
the Employer which are not subject to a deferral election by
an Employee and which are not matching contributions.
(k) "Qualified matching contributions" are matching
contributions which are 100% Nonforfeitable at all times and
which are subject to the distribution restrictions described
in paragraph (m). Matching contributions are not 100%
Nonforfeitable at all times if the Employee has a 100%
Nonforfeitable interest because of his Years of Service
taken into account under a vesting schedule. Any matching
contributions allocated to a Participant's Qualified
Matching Contributions Account under the Plan automatically
satisfy the definition of qualified matching contributions.
(l) "Qualified nonelective contributions" are nonelective
contributions which are 100% Nonforfeitable at all times and
which are subject to the distribution restrictions described
in paragraph (m). Nonelective contributions are not 100%
Nonforfeitable at all times if the Employee has a 100%
Nonforfeitable interest because of his Years of Service
taken into account under a vesting schedule. Any nonelective
contributions allocated to a Participant's Qualified
Nonelective Contributions Account under the Plan
automatically satisfy the definition of qualified
nonelective contributions.
(m) "Distribution restrictions" means the Employee may not
receive a distribution of the specified contributions (nor
earnings on those contributions) except in the event of (1)
the Participant's death, disability, termination of
employment or attainment of age 59 1/2, (2) financial hardship
satisfying the requirements of Code Section 401(k) and the
applicable Treasury regulations, (3) a plan termination,
without establishment of a successor defined contribution
plan (other than an ESOP), (4) a sale of substantially all
of the assets (within the meaning of Code Section 409(d)(2))
used in a trade or business, but only to an employee who
continues employment with the corporation acquiring those
assets, or (5) a sale by a corporation of its interest in a
subsidiary (within the meaning of Code Section 409(d)(3)),
but only to an employee who continues employment with the
subsidiary. For Plan Years beginning after December 31,
1988, a distribution on account of financial hardship, as
described in clause (2), may not include earnings on
elective deferrals credited as of a date later than December
31, 1988, and may not include qualified matching
contributions and qualified nonelective contributions, nor
any earnings on such contributions, credited after December
31, 1988. A plan does not violate the distribution
restrictions if, instead of the December 31, 1988, date in
the preceding sentence the plan specifies a date not later
than the end of the last Plan Year ending before July 1,
1989. A distribution described in clauses (3), (4) or (5),
if made after March 31, 1988, must be a lump sum
distribution, as required under Code Section 401(k)(10).
(n) "Employee contributions" are contributions made by a
Participant on an after-tax basis, whether voluntary or
mandatory, and designated, at the time of contribution, as
an employee (or nondeductible) contribution. Elective
deferrals and deferral contributions are not employee
contributions. Participant nondeductible contributions, made
pursuant to Section 4.01 of the Plan, are employee
contributions.
14.04 MATCHING CONTRIBUTIONS/EMPLOYEE CONTRIBUTIONS. The
---------------------------------------------
Employer may elect in Adoption Agreement Section 3.01 to provide
matching contributions. The Employer also may elect in Adoption
Agreement Section 4.01 to permit or to require a Participant to
make nondeductible contributions.
(A) Mandatory contributions. Any Participant nondeductible
contributions eligible for matching contributions are mandatory
contributions. The Advisory Committee will maintain a separate
accounting, pursuant to Section 4.06 of the Plan, to reflect the
Participant's Accrued Benefit derived from his mandatory
contributions. The Employer, under Adoption Agreement Section
4.05, may prescribe special distribution restrictions which will
apply to the Mandatory Contributions Account prior to the
Participant's Separation from Service. Following his Separation
from Service, the general distribution provisions of Article VI
apply to the distribution of the Participant's Mandatory
Contributions Account.
14.05 TIME OF PAYMENT OF CONTRIBUTIONS. The Employer must
--------------------------------
make Salary Reduction Contributions to the Trust within an
administratively reasonable period of time after withholding the
corresponding Compensation from the Participant. Furthermore, the
Employer must make Salary Reduction Contributions, Cash or
Deferred Contributions, Employer matching contributions
(including qualified Employer matching contributions) and
qualified Employer nonelective contributions no later than the
time prescribed by the Code or by applicable Treasury
regulations. Salary Reduction Contributions and Cash or Deferred
Contributions are Employer contributions for all purposes under
this Plan, except to the extent the Code or Treasury regulations
prohibit the use of these contributions to satisfy the
qualification requirements of the Code.
14.06 SPECIAL ALLOCATION PROVISIONS - DEFERRAL
----------------------------------------
CONTRIBUTIONS, MATCHING CONTRIBUTIONS AND QUALIFIED NONELECTIVE
---------------------------------------------------------------
CONTRIBUTIONS. To make allocations under the Plan, the Advisory
-------------
Committee must establish a Deferral Contributions Account, a
Qualified Matching Contributions Account, a Regular Matching
Contributions Account, a Qualified Nonelective Contributions
Account and an Employer Contributions Account for each
Participant.
(A) Deferral contributions. The Advisory Committee will allocate
to each Participant's Deferral Contributions Account the amount
of Deferral Contributions the Employer makes to the Trust on
behalf of the Participant. The Advisory Committee will make this
allocation as of the last day of each Plan Year unless, in
Adoption Agreement Section 3.04, the Employer elects more
frequent allocation dates for salary reduction contributions.
(B) Matching contributions. The Employer must specify in its
Adoption Agreement whether the Advisory Committee will allocate
matching contributions to the Qualified Matching Contributions
Account or to the Regular Matching Contributions Account of each
Participant. The Advisory Committee will make this allocation as
of the last day of each Plan Year unless, in Adoption Agreement
Section 3.04, the Employer elects more frequent allocation dates
for matching contributions.
(1) To the extent the Employer makes matching contributions
under a fixed matching contribution formula, the Advisory
Committee will allocate the matching contribution to the
Account of the Participant on whose behalf the Employer
makes that contribution. A fixed matching contribution
formula is a formula under which the Employer contributes a
certain percentage or dollar amount on behalf of a
Participant based on that Participant's deferral
contributions or nondeductible contributions eligible for a
match, as specified in Section 3.01 of the Employer's
Adoption Agreement. The Employer may contribute on a
Participant's behalf under a specific matching contribution
formula only if the Participant satisfies the accrual
requirements for matching contributions specified in Section
3.06 of the Employer's Adoption Agreement and only to the
extent the matching contribution does not exceed the
Participant's annual additions limitation in Part 2 of
Article III.
(2) To the extent the Employer makes matching contributions
under a discretionary formula, the Advisory Committee will
allocate the discretionary matching contributions to the
Account of each Participant who satisfies the accrual
requirements for matching contributions specified in Section
3.06 of the Employer's Adoption Agreement. The allocation of
discretionary matching contributions to a Participant's
Account is in the same proportion that each Participant's
eligible contributions bear to the total eligible
contributions of all Participants. If the discretionary
formula is a tiered formula, the Advisory Committee will
make this allocation separately with respect to each tier of
eligible contributions, allocating in such manner the amount
of the matching contributions made with respect to that
tier. "Eligible contributions" are the Participant's
deferral contributions or nondeductible contributions
eligible for an allocation of matching contributions, as
specified in Section 3.01 of the Employer's Adoption
Agreement.
If the matching contribution formula applies both to
deferral contributions and to Participant nondeductible
contributions, the matching contributions apply first to deferral
contributions. Furthermore, the matching contribution formula
does not apply to deferral contributions that are excess
deferrals under Section 14.07. For this purpose: (a) excess
deferrals relate first to deferral contributions for the Plan
Year not otherwise eligible for a matching contribution; and (2)
if the Plan Year is not a calendar year, the excess deferrals for
a Plan Year are the last elective deferrals made for a calendar
year. Under a Standardized Plan, an Employee forfeits any
matching contribution attributable to an excess contribution or
to an excess aggregate contribution, unless distributed pursuant
to Sections 14.08 or 14.09. Under a Nonstandardized Plan, this
forfeiture rule applies only if specified in Adoption Agreement
Section 3.06. The provisions of Section 3.05 govern the treatment
of any forfeiture described in this paragraph, and the Advisory
Committee will compute a Participant's ACP under 14.09 by
disregarding the forfeiture.
(C) Qualified nonelective contributions. If the Employer, at the
time of contribution, designates a contribution to be a qualified
nonelective contribution for the Plan Year, the Advisory
Committee will allocate that qualified nonelective contribution
to the Qualified Nonelective Contributions Account of each
Participant eligible for an allocation of that designated
contribution, as specified in Section 3.04 of the Employer's
Adoption Agreement. The Advisory Committee will make the
allocation to each eligible Participant's Account in the same
ratio that the Participant's Compensation for the Plan Year bears
to the total Compensation of all eligible Participants for the
Plan Year. The Advisory Committee will determine a Participant's
Compensation in accordance with the general definition of
Compensation under Section 1.12 of the Plan, as modified by the
Employer in Sections 1.12 and 3.06 of its Adoption Agreement.
(D) Nonelective contributions. To the extent the Employer makes
nonelective contributions for the Plan Year which, at the time of
contribution, it does not designate as qualified nonelective
contributions, the Advisory Committee will allocate those
contributions in accordance with the elections under Section 3.04
of the Employer's Adoption Agreement. For purposes of the special
nondiscrimination tests described in Sections 14.08 and 14.09,
the Advisory Committee may treat nonelective contributions
allocated under this paragraph as qualified nonelective
contributions, if the contributions otherwise satisfy the
definition of qualified nonelective contributions.
14.07 ANNUAL ELECTIVE DEFERRAL LIMITATION.
-----------------------------------
(A) Annual Elective Deferral Limitation. An Employee's elective
deferrals for a calendar year beginning after December 31, 1986,
may not exceed the 402(g) limitation. The 402(g) limitation is
the greater of $7,000 or the adjusted amount determined by the
Secretary of the Treasury. If, pursuant to a salary reduction
agreement or pursuant to a cash or deferral election, the
Employer determines the Employee's elective deferrals to the Plan
for a calendar year would exceed the 402(g) limitation, the
Employer will suspend the Employee's salary reduction agreement,
if any, until the following January 1 and pay in cash the portion
of a cash or deferral election which would result in the
Employee's elective deferrals for the calendar year exceeding the
402(g) limitation. If the Advisory Committee determines an
Employee's elective deferrals already contributed to the Plan for
a calendar year exceed the 402(g) limitation, the Advisory
Committee will distribute the amount in excess of the 402(g)
limitation (the "excess deferral"), as adjusted for allocable
income, no later than April 15 of the following calendar year. If
the Advisory Committee distributes the excess deferral by the
appropriate April 15, it may make the distribution irrespective
of any other provision under this Plan or under the Code. The
Advisory Committee will reduce the amount of excess deferrals for
a calendar year distributable to the Employee by the amount of
excess contributions (as determined in Section 14.08), if any,
previously distributed to the Employee for the Plan Year
beginning in that calendar year.
If an Employee participates in another plan under which he
makes elective deferrals pursuant to a Code Section 401(k)
arrangement, elective deferrals under a Simplified Employee
Pension, or salary reduction contributions to a tax-sheltered
annuity, irrespective of whether the Employer maintains the other
plan, he may provide the Advisory Committee a written claim for
excess deferrals made for a calendar year. The Employee must
submit the claim no later than the March 1 following the close of
the particular calendar year and the claim must specify the
amount of the Employee's elective deferrals under this Plan which
are excess deferrals. If the Advisory Committee receives a timely
claim, it will distribute the excess deferral (as adjusted for
allocable income) the Employee has assigned to this Plan, in
accordance with the distribution procedure described in the
immediately preceding paragraph.
(B) Allocable income. For purposes of making a distribution of
excess deferrals pursuant to this Section 14.07, allocable income
means net income or net loss allocable to the excess deferrals
for the calendar year in which the Employee made the excess
deferral, determined in a manner which is uniform,
nondiscriminatory and reasonably reflective of the manner used by
the Plan to allocate income to Participants' Accounts.
14.08 ACTUAL DEFERRAL PERCENTAGE ("ADP") TEST. For each Plan
---------------------------------------
Year, the Advisory Committee must determine whether the Plan's
Code Section 401(k) arrangement satisfies either of the following
ADP tests:
(i) The average ADP for the Highly Compensated Group does
not exceed 1.25 times the average ADP of the Nonhighly
Compensated Group; or
(ii) The average ADP for the Highly Compensated Group does
not exceed the average ADP for the Nonhighly Compensated
Group by more than two percentage points (or the lesser
percentage permitted by the multiple use limitation in
Section 14.10) and the average ADP for the Highly
Compensated Group is not more than twice the average ADP for
the Nonhighly Compensated Group.
(A) Calculation of ADP. The average ADP for a group is the
average of the separate ADPs calculated for each Eligible
Employee who is a member of that group. An Eligible Employee's
ADP for a Plan Year is the ratio of the Eligible Employee's
deferral contributions for the Plan Year to the Employee's
Compensation for the Plan Year. For aggregated family members
treated as a single Highly Compensated Employee, the ADP of the
family unit is the ADP determined by combining the deferral
contributions and Compensation of all aggregated family members.
A Nonhighly Compensated Employee's ADP does not include elective
deferrals made to this Plan or to any other Plan maintained by
the Employer, to the extent such elective deferrals exceed the
402(g) limitation described in Section 14.07(A).
The Advisory Committee, in a manner consistent with Treasury
regulations, may determine the ADPs of the Eligible Employees by
taking into account qualified nonelective contributions or
qualified matching contributions, or both, made to this Plan or
to any other qualified Plan maintained by the Employer. The
Advisory Committee may not include qualified nonelective
contributions in the ADP test unless the allocation of
nonelective contributions is nondiscriminatory when the Advisory
Committee takes into account all nonelective contributions
(including the qualified nonelective contributions) and also when
the Advisory Committee takes into account only the nonelective
contributions not used in either the ADP test described in this
Section 14.08 or the ACP test described in Section 14.09. For
Plan Years beginning after December 31, 1989, the Advisory
Committee may not include in the ADP test any qualified
nonelective contributions or qualified matching contributions
under another qualified plan unless that plan has the same plan
year as this Plan. The Advisory Committee must maintain records
to demonstrate compliance with the ADP test, including the extent
to which the Plan used qualified nonelective contributions or
qualified matching contributions to satisfy the test.
For Plan Years beginning prior to January 1, 1992, the
Advisory Committee may elect to apply a separate ADP test to each
component group under the Plan. Each component group separately
must satisfy the commonality requirement of the Code Section
401(k) regulations and the minimum coverage requirements of Code
Section 410(b). A component group consists of all the allocations
and other benefits, rights and features provided that group of
Employees. An Employee may not be part of more than one component
group. The correction rules described in this Section 14.08 apply
separately to each component group.
(B) Special aggregation rule for Highly Compensated Employees.
To determine the ADP of any Highly Compensated Employee, the
deferral contributions taken into account must include any
elective deferrals made by the Highly Compensated Employee under
any other Code Section 401(k) arrangement maintained by the
Employer, unless the elective deferrals are to an ESOP. If the
plans containing the Code Section 401(k) arrangements have
different plan years, the Advisory Committee will determine the
combined deferral contributions on the basis of the plan years
ending in the same calendar year.
(C) Aggregation of certain Code Section 401(k) arrangements. If
the Employer treats two plans as a unit for coverage or
nondiscrimination purposes, the Employer must combine the Code
Section 401(k) arrangements under such plans to determine whether
either plan satisfies the ADP test. This aggregation rule applies
to the ADP determination for all Eligible Employees, irrespective
of whether an Eligible Employee is a Highly Compensated Employee
or a Nonhighly Compensated Employee. For Plan Years beginning
after December 31, 1989, an aggregation of Code Section 401(k)
arrangements under this paragraph does not apply to plans which
have different plan years and, for Plan Years beginning after
December 31, 1988, the Advisory Committee may not aggregate an
ESOP (or the ESOP portion of a plan) with a non-ESOP plan (or non-
ESOP portion of a plan).
(D) Characterization of excess contributions. If, pursuant to
this Section 14.08, the Advisory Committee has elected to include
qualified matching contributions in the average ADP, the Advisory
Committee will treat excess contributions as attributable
proportionately to deferral contributions and to qualified
matching contributions allocated on the basis of those deferral
contributions. If the total amount of a Highly Compensated
Employee's excess contributions for the Plan Year exceeds his
deferral contributions or qualified matching contributions for
the Plan Year, the Advisory Committee will treat the remaining
portion of his excess contributions as attributable to qualified
nonelective contributions. The Advisory Committee will reduce the
amount of excess contributions for a Plan Year distributable to a
Highly Compensated Employee by the amount of excess deferrals (as
determined in Section 14.07), if any, previously distributed to that
Employee for the Employee's taxable year ending in that Plan Year.
(E) Distribution of excess contributions. If the Advisory
Committee determines the Plan fails to satisfy the ADP test for a
Plan Year, it must distribute the excess contributions, as
adjusted for allocable income, during the next Plan Year.
However, the Employer will incur an excise tax equal to 10% of
the amount of excess contributions for a Plan Year not
distributed to the appropriate Highly Compensated Employees
during the first 2 1/2 months of that next Plan Year. The excess
contributions are the amount of deferral contributions made by
the Highly Compensated Employees which causes the Plan to fail to
satisfy the ADP test. The Advisory Committee will distribute to
each Highly Compensated Employee his respective share of the
excess contributions. The Advisory Committee will determine the
respective shares of excess contributions by starting with the
Highly Compensated Employee(s) who has the greatest ADP, reducing
his ADP (but not below the next highest ADP), then, if necessary,
reducing the ADP of the Highly Compensated Employee(s) at the
next highest ADP level (including the ADP of the Highly
Compensated Employee(s) whose ADP the Advisory Committee already
has reduced), and continuing in this manner until the average ADP
for the Highly Compensated Group satisfies the ADP test. If the
Highly Compensated Employee is part of an aggregated family group,
the Advisory Committee, in accordance with the applicable Treasury
regulations, will determine each aggregated family member's allocable
share of the excess contributions assigned to the family unit.
(F) Allocable income. To determine the amount of the corrective
distribution required under this Section 14.08, the Advisory
Committee must calculate the allocable income for the Plan Year
in which the excess contributions arose. "Allocable income" means
net income or net loss. To calculate allocable income for the
Plan Year, the Advisory Committee will use a uniform and
nondiscriminatory method which reasonably reflects the manner
used by the Plan to allocate income to Participants' Accounts.
14.09 NONDISCRIMINATION RULES FOR EMPLOYER MATCHING
---------------------------------------------
CONTRIBUTIONS / PARTICIPANT NONDEDUCTIBLE CONTRIBUTIONS. For Plan
-------------------------------------------------------
Years beginning after December 31, 1986, the Advisory Committee
must determine whether the annual Employer matching contributions
(other than qualified matching contributions used in the ADP
under Section 14.08), if any, and the Employee contributions, if
any, satisfy either of the following average contribution
percentage ("ACP") tests:
(i) The ACP for the Highly Compensated Group does not
exceed 1.25 times the ACP of the Nonhighly Compensated
Group; or
(ii) The ACP for the Highly Compensated Group does not
exceed the ACP for the Nonhighly Compensated Group by more
than two percentage points (or the lesser percentage
permitted by the multiple use limitation in Section 14.10)
and the ACP for the Highly Compensated Group is not more
than twice the ACP for the Nonhighly Compensated Group.
(A) Calculation of ACP. The average contribution percentage for
a group is the average of the separate contribution percentages
calculated for each Eligible Employee who is a member of that
group. An Eligible Employee's contribution percentage for a Plan
Year is the ratio of the Eligible Employee's aggregate
contributions for the Plan Year to the Employee's Compensation
for the Plan Year. "Aggregate contributions" are Employer
matching contributions (other than qualified matching
contributions used in the ADP test under Section 14.08) and
employee contributions (as defined in Section 14.03). For
aggregated family members treated as a single Highly Compensated
Employee, the contribution percentage of the family unit is the
contribution percentage determined by combining the aggregate
contributions and Compensation of all aggregated family members.
The Advisory Committee, in a manner consistent with Treasury
regulations, may determine the contribution percentages of the
Eligible Employees by taking into account qualified nonelective
contributions (other than qualified nonelective contributions
used in the ADP test under Section 14.08) or elective deferrals,
or both, made to this Plan or to any other qualified Plan
maintained by the Employer. The Advisory Committee may not include
qualified nonelective contributions in the ACP test unless the
allocation of nonelective contributions is nondiscriminatory when
the Advisory Committee takes into account all nonelective
contributions (including the qualified nonelective contributions)
and also when the Advisory Committee takes into account only the
nonelective contributions not used in either the ADP test described
in Section 14.08 or the ACP test described in this Section 14.09.
The Advisory Committee may not include elective deferrals in the
ACP test, unless the Plan which includes the elective deferrals
satisfies the ADP test both with and without the elective
deferrals included in this ACP test. For Plan Years beginning
after December 31, 1989, the Advisory Committee may not include
in the ACP test any qualified nonelective contributions or elective
deferrals under another qualified plan unless that plan has the same
plan year as this Plan. The Advisory Committee must maintain records
to demonstrate compliance with the ACP test, including the extent to
which the Plan used qualified nonelective contributions or elective
deferrals to satisfy the test. For Plan Years beginning prior to
January 1, 1992, the component group testing rule permitted under
Section 14.08(A) also applies to the ACP test under this Section 14.09.
(B) Special aggregation rule for Highly Compensated Employees. To
determine the contribution percentage of any Highly Compensated
Employee, the aggregate contributions taken into account must include
any matching contributions (other than qualified matching contributions
used in the ADP test) and any Employee contributions made on his behalf
to any other plan maintained by the Employer, unless the other plan is
an ESOP. If the plans have different plan years, the Advisory Committee
will determine the combined aggregate contributions on the basis of
the plan years ending in the same calendar year.
(C) Aggregation of certain plans. If the Employer treats two
plans as a unit for coverage or nondiscrimination purposes, the
Employer must combine the plans to determine whether either plan
satisfies the ACP test. This aggregation rule applies to the
contribution percentage determination for all Eligible Employees,
irrespective of whether an Eligible Employee is a Highly
Compensated Employee or a Nonhighly Compensated Employee. For
Plan Years beginning after December 31, 1989, an aggregation of
plans under this paragraph does not apply to plans which have
different plan years and, for Plan Years beginning after December
31, 1988, the Advisory Committee may not aggregate an ESOP (or
the ESOP portion of a plan) with a non-ESOP plan (or non-ESOP
portion of a plan).
(D) Distribution of excess aggregate contributions. The Advisory
Committee will determine excess aggregate contributions after
determining excess deferrals under Section 14.07 and excess
contributions under Section 14.08. If the Advisory Committee
determines the Plan fails to satisfy the ACP test for a Plan
Year, it must distribute the excess aggregate contributions, as
adjusted for allocable income, during the next Plan Year.
However, the Employer will incur an excise tax equal to 10% of
the amount of excess aggregate contributions for a Plan Year not
distributed to the appropriate Highly Compensated Employees
during the first 2 1/2 months of that next Plan Year. The excess
aggregate contributions are the amount of aggregate contributions
allocated on behalf of the Highly Compensated Employees which
causes the Plan to fail to satisfy the ACP test. The Advisory
Committee will distribute to each Highly Compensated Employee his
respective share of the excess aggregate contributions. The
Advisory Committee will determine the respective shares of excess
aggregate contributions by starting with the Highly Compensated
Employee(s) who has the greatest contribution percentage,
reducing his contribution percentage (but not below the next
highest contribution percentage), then, if necessary, reducing
the contribution percentage of the Highly Compensated Employee(s)
at the next highest contribution percentage level (including the
contribution percentage of the Highly Compensated Employee(s)
whose contribution percentage the Advisory Committee already has
reduced), and continuing in this manner until the ACP for the
Highly Compensated Group satisfies the ACP test. If the Highly
Compensated Employee is part of an aggregated family group, the
Advisory Committee, in accordance with the applicable Treasury
regulations, will determine each aggregated family member's
allocable share of the excess aggregate contributions assigned to
the family unit.
(E) Allocable income. To determine the amount of the corrective
distribution required under this Section 14.09, the Advisory
Committee must calculate the allocable income for the Plan Year
in which the excess aggregate contributions arose. "Allocable
income" means net income or net loss. The Advisory Committee will
determine allocable income in the same manner as described in
Section 14.08(F) for excess contributions.
(F) Characterization of excess aggregate contributions. The
Advisory Committee will treat a Highly Compensated Employee's
allocable share of excess aggregate contributions in the
following priority: (1) first as attributable to his Employee
contributions which are voluntary contributions, if any; (2) then
as matching contributions allocable with respect to excess
contributions determined under the ADP test described in Section
14.08; (3) then on a pro rata basis to matching contributions and
to the deferral contributions relating to those matching
contributions which the Advisory Committee has included in the
ACP test; (4) then on a pro rata basis to Employee contributions
which are mandatory contributions, if any, and to the matching
contributions allocated on the basis of those mandatory
contributions; and (5) last to qualified nonelective
contributions used in the ACP test. To the extent the Highly
Compensated Employee's excess aggregate contributions are
attributable to matching contributions, and he is not 100% vested
in his Accrued Benefit attributable to matching contributions,
the Advisory Committee will distribute only the vested portion
and forfeit the nonvested portion. The vested portion of the
Highly Compensated Employee's excess aggregate contributions
attributable to Employer matching contributions is the total
amount of such excess aggregate contributions (as adjusted for
allocable income) multiplied by his vested percentage (determined
as of the last day of the Plan Year for which the Employer made
the matching contribution). The Employer will specify in Adoption
Agreement Section 3.05 the manner in which the Plan will allocate
forfeited excess aggregate contributions.
14.10 MULTIPLE USE LIMITATION. For Plan Years beginning
-----------------------
after December 31, 1988, if at least one Highly Compensated
Employee is includible in the ADP test under Section 14.08 and in
the ACP test under Section 14.09, the sum of the Highly
Compensated Group's ADP and ACP may not exceed the multiple use
limitation.
The multiple use limitation is the sum of (i) and (ii):
(i) 125% of the greater of: (a) the ADP of the Nonhighly
Compensated Group under the Code Section 401(k) arrangement;
or (b) the ACP of the Nonhighly Compensated Group for the
Plan Year beginning with or within the Plan Year of the Code
Section 401(k) arrangement.
(ii) 2% plus the lesser of (i)(a) or (i)(b), but no more
than twice the lesser of (i)(a) or (i)(b).
The Advisory Committee, in lieu of determining the multiple
use limitation as the sum of (i) and (ii), may elect to determine
the multiple use limitation as the sum of (iii) and (iv):
(iii) 125% of the lesser of: (a) the ADP of the
Nonhighly Compensated Group under the Code Section 401(k)
arrangement; or (b) the ACP of the Nonhighly Compensated
Group for the Plan Year beginning with or within the Plan
Year of the Code Section 401(k) arrangement.
(iv) 2% plus the greater of (iii)(a) or (iii)(b), but no
more than twice the greater of (iii)(a) or (iii)(b).
The Advisory Committee will determine whether the Plan
satisfies the multiple use limitation after applying the ADP test
under Section 14.08 and the ACP test under Section 14.09 and
after making any corrective distributions required by those
Sections. If, after applying this Section 14.10, the Advisory
Committee determines the Plan has failed to satisfy the multiple
use limitation, the Advisory Committee will correct the failure
by treating the excess amount as excess contributions under
Section 14.08 or as excess aggregate contributions under Section
14.09, as it determines in its sole discretion. This Section
14.10 does not apply unless, prior to application of the multiple
use limitation, the ADP and the ACP of the Highly Compensated
Group each exceeds 125% of the respective percentages for the
Nonhighly Compensated Group.
14.11 DISTRIBUTION RESTRICTIONS. The Employer must elect in
-------------------------
Section 6.03 the Adoption Agreement the distribution events
permitted under the Plan. The distribution events applicable to
the Participant's Deferral Contributions Account, Qualified
Nonelective Contributions Account and Qualified Matching
Contributions Account must satisfy the distribution restrictions
described in paragraph (m) of Section 14.03.
(A) Hardship distributions from Deferral Contributions Account.
The Employer must elect in Adoption Agreement Section 6.03
whether a Participant may receive hardship distributions from his
Deferral Contributions Account prior to the Participant's
Separation from Service. Hardship distributions from the Deferral
Contributions Account must satisfy the requirements of this
Section 14.11. A hardship distribution option may not apply to
the Participant's Qualified Nonelective Contributions Account or
Qualified Matching Contributions Account, except as provided in
paragraph (3).
(1) Definition of hardship. A hardship distribution under
this Section 14.11 must be on account of one or more of the
following immediate and heavy financial needs: (1) medical care
described in Code Section 213(d) incurred by the Participant, by
the Participant's spouse, or by any of the Participant's
dependents, or necessary to obtain such medical care; (2) the
purchase (excluding mortgage payments) of a principal residence
for the Participant; (3) the payment of post-secondary education
tuition and related educational fees, for the next 12-month
period, for the Participant, for the Participant's spouse, or for
any of the Participant's dependents (as defined in Code Section
152); (4) to prevent the eviction of the Participant from his
principal residence or the foreclosure on the mortgage of the
Participant's principal residence; or (5) any need prescribed by
the Revenue Service in a revenue ruling, notice or other document
of general applicability which satisfies the safe harbor
definition of hardship.
(2) Restrictions. The following restrictions apply to a
Participant who receives a hardship distribution: (a) the
Participant may not make elective deferrals or employee
contributions to the Plan for the 12-month period following the
date of his hardship distribution; (b) the distribution is not in
excess of the amount of the immediate and heavy financial need
(including any amounts necessary to pay any federal, state or
local income taxes or penalties reasonably anticipated to result
from the distribution); (c) the Participant must have obtained
all distributions, other than hardship distributions, and all
nontaxable loans (determined at the time of the loan) currently
available under this Plan and all other qualified plans
maintained by the Employer; and (d) the Participant agrees to
limit elective deferrals under this Plan and under any other
qualified Plan maintained by the Employer, for the Participant's
taxable year immediately following the taxable year of the
hardship distribution, to the 402(g) limitation (as described in
Section 14.07), reduced by the amount of the Participant's
elective deferrals made in the taxable year of the hardship
distribution. The suspension of elective deferrals and employee
contributions described in clause (a) also must apply to all
other qualified plans and to all nonqualified plans of deferred
compensation maintained by the Employer, other than any mandatory
employee contribution portion of a defined benefit plan,
including stock option, stock purchase and other similar plans,
but not including health or welfare benefit plans (other than the
cash or deferred arrangement portion of a cafeteria plan).
(3) Earnings. For Plan Years beginning after December 31,
1988, a hardship distribution under this Section 14.11 may not
include earnings on an Employee's elective deferrals credited
after December 31, 1988. Qualified matching contributions and
qualified nonelective contributions, and any earnings on such
contributions, credited as of December 31, 1988, are subject to
the hardship withdrawal only if the Employer specifies in an
addendum to this Section 14.11. The addendum may modify the
December 31, 1988, date for purposes of determining credited
amounts provided the date is not later than the end of the last
Plan Year ending before July 1, 1989.
(B) Distributions after Separation from Service. Following the
Participant's Separation from Service, the distribution events
applicable to the Participant apply equally to all of the
Participant's Accounts, except as elected in Section 6.03 of the
Employer's Adoption Agreement.
(C) Correction of Annual Additions Limitation. If, as a result
of a reasonable error in determining the amount of elective
deferrals an Employee may make without violating the limitations
of Part 2 of Article III, an Excess Amount results, the Advisory
Committee will return the Excess Amount (as adjusted for
allocable income) attributable to the elective deferrals. The
Advisory Committee will make this distribution before taking any
corrective steps pursuant to Section 3.10 or to Section 3.16. The
Advisory Committee will disregard any elective deferrals returned
under this Section 14.11(C) for purposes of Sections 14.07, 14.08
and 14.09.
14.12 SPECIAL ALLOCATION RULES. If the Code Section 401(k)
------------------------
arrangement provides for salary reduction contributions, if the
Plan accepts Employee contributions, pursuant to Adoption
Agreement Section 4.01, or if the Plan allocates matching
contributions as of any date other than the last day of the Plan
Year, the Employer must elect in Adoption Agreement 9.11 whether
any special allocation provisions will apply under Section 9.11
of the Plan. For purposes of the elections:
(a) A "segregated Account" direction means the Advisory
Committee will establish a segregated Account for the
applicable contributions made on the Participant's behalf
during the Plan Year. The Trustee must invest the segregated
Account in Federally insured interest bearing savings
account(s) or time deposits, or a combination of both, or in
any other fixed income investments, unless otherwise
specified in the Employer's Adoption Agreement. As of the
last day of each Plan Year (or, if earlier, an allocation
date coinciding with a valuation date described in Section
9.11), the Advisory Committee will reallocate the segregated
Account to the Participant's appropriate Account, in
accordance with Section 3.04 or Section 4.06, whichever
applies to the contributions.
(b) A "weighted average allocation" method will treat a
weighted portion of the applicable contributions as if
includible in the Participant's Account as of the beginning
of the valuation period. The weighted portion is a fraction,
the numerator of which is the number of months in the
valuation period, excluding each month in the valuation
period which begins prior to the contribution date of the
applicable contributions, and the denominator of which is
the number of months in the valuation period. The Employer
may elect in its Adoption Agreement to substitute a
weighting period other than months for purposes of this
weighted average allocation.
* * * * * * * * * * * * * * *
ARTICLE A
APPENDIX TO PLAN AND TRUST AGREEMENT
This Article is necessary to comply with the Unemployment
Compensation Amendments Act of 1992 and is an integral part of
the basic plan document. Section 12.08 applies to any
modification or amendment of this Article.
A-1. APPLICATIONS. This Article applies to distributions
------------
made on or after January 1, 1993. Notwithstanding any provision
of the Plan to the contrary that would otherwise limit a
distributee's election under this Article, 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.
A-2. DEFINITIONS.
-----------
(a) "Eligible rollover distribution." An eligible rollover
distribution is any distribution of all or any portion of the
balance to the credit of the distributee, except that an eligible
rollover distribution does not include: any distribution that is
one of a series of substantially equal periodic payments (not
less frequently than annually) made for the life (or life
expectancy) of the distributee or the joint lives (or joint life
expectancies) of the distributee and the distributee's designated
beneficiary, or for a specified period of ten years or more; any
distribution to the extent such distribution is required under
Code Section 401(a)(9); and the portion of any distribution that
is not includible in gross income (determined without regard to
the exclusion of net unrealized appreciation with respect to
employer securities).
(b) "Eligible retirement plan." An eligible retirement plan
is an individual retirement account described in Code Section
408(a), an individual retirement annuity described in Code
Section 408(b), an annuity plan described in Code Section 403(a),
or a qualified trust described in Code Section 401(a), that
accepts the distributee's eligible rollover distribution.
However, in the case of an eligible rollover distribution to the
surviving spouse, an eligible retirement plan is an individual
retirement account or individual retirement annuity.
(c) "Distributee." A distributee includes 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 Code
Section 414(p), are distributees with regard to the interest of
the spouse or former spouse.
(d) "Direct rollover." A direct rollover is a payment by
the Plan to the eligible retirement plan specified by the
distributee.
A-1
ARTICLE B
APPENDIX TO BASIC PLAN DOCUMENT
This Article is necessary to comply with the Omnibus Budget
Reconciliation Act of 1993 (OBRA '93) and is an integral part of
the basic plan document. Section 12.08 applies to any
modification or amendment of this Article.
In addition to other applicable limitations set forth in the
plan, and notwithstanding any other provision of the plan to the
contrary, for plan years beginning on or after January 1, 1994,
the annual compensation of each employee taken into account under
the plan shall not exceed the OBRA '93 annual compensation limit.
The OBRA '93 annual compensation limit is $150,000 , as adjusted
by the Commissioner for increases in the cost of living in
accordance with Section 401(a)(17)(B) of the Internal Revenue
Code. The cost-of-living adjustment in effect for a calendar
year applies to any period, not exceeding 12 months, over which
compensation is determined (determination period) beginning in
such calendar year. If a determination period consists of fewer
than 12 months, the OBRA '93 annual compensation limit will be
multiplied by a fraction, the numerator of which is the number of
months in the determination period, and the denominator of which
is 12.
For plan years beginning on or after January 1, 1994, any
reference in this plan to the limitation under Section 401(a)(17)
of the Code shall mean the OBRA '93 annual compensation limit set
forth in this provision.
If compensation for any prior determination period is taken
into account in determining an employee's benefits accruing in
the current plan year, the compensation for that prior
determination period is subject to the OBRA '93 annual
compensation limit in effect for that prior determination period.
For this purpose, for determination period beginning before the
first day of the first plan year beginning on or after January 1,
1994, the OBRA '93 annual compensation limit is $150,000.
B-1
ARTICLE C
APPENDIX TO BASIC PLAN DOCUMENT
Rev. Rul. 94-76 Model Amendment
This amendment is effective on the first day of the first
Plan Year beginning on or after December 12, 1994, or, if later,
March 12, 1995.
Notwithstanding any provision of this Plan to the contrary,
to the extent that any optional form of benefit under this Plan
permits a distribution prior to the Employee's retirement, death,
disability, or severance from employment, and prior to plan
termination, the optional form of benefits is not available with
respect to benefits attributable to assets (including the post-
transfer earnings thereon) and liabilities that are transferred,
within the meaning of Code Section 414(l), to this Plan from a
money purchase pension plan qualified under Code Section 401(a)
(other than any portion of those assets and liabilities
attributable to voluntary Employee contributions).
C-1
ARTICLE D
APPENDIX TO BASIC PLAN DOCUMENT
USERRA Model Amendment
This amendment is effective as of December 12, 1994.
Notwithstanding any provision of this Plan to the contrary,
contributions, benefits and service credit with respect to
qualified military service will be provided in accordance with
Code Section 414(u). Loan repayments will be suspended under
this Plan as permitted under Code Section 414(u)(4).
D-1
