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Exhibit 4.2
FREEDOM CAPITAL MANAGEMENT CORPORATION
DEFERRED SAVINGS PLAN
AND TRUST AGREEMENT
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TABLE OF CONTENTS
Page
ARTICLE I
Introduction............................................................. 2
1.01 Creation of Trust......................................... 2
1.02 Interpretation of Trust Agreement......................... 2
ARTICLE II
Definitions.............................................................. 3
2.01 "Affiliated Company"...................................... 3
2.02 "Agreement"............................................... 3
2.03 "Anniversary Date"........................................ 3
2.04 "Basic Contributions"..................................... 3
2.05 "Beneficiary"............................................. 3
2.06 "Board of Directors"...................................... 4
2.07 "Committee"............................................... 4
2.08 "Company"................................................. 4
2.09 "Compensation"............................................ 4
2.10 "Eligible Employee"....................................... 5
2.11 "Employee"................................................ 5
2.12 "Employment Commencement Date"............................ 5
2.13 "Family Member"........................................... 5
2.14 "Highly Compensated Employee"............................. 5
2.15 "Hour of Service"......................................... 7
2.16 "Investment Fund" or "Investment Funds"................... 8
2.17 "Matching Contributions".................................. 8
2.18 "Net Earnings"............................................ 9
2.19 "Normal Retirement Age"................................... 9
2.20 "Participant"............................................. 9
2.21 "Period of Service"....................................... 9
2.22 "Period of Severance"..................................... 9
2.23 "Plan".................................................... 9
2.24 "Plan Year"............................................... 9
2.25 "Reemployment Commencement Date".......................... 9
2.26 "Salary Reduction Agreement".............................. 10
2.27 "Severance from Service Date"............................. 10
2.28 "Trust"................................................... 10
2.29 "Trustees"................................................ 10
2.30 "Valuation Date".......................................... 10
(i)
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ARTICLE III
Participation............................................................ 11
3.01 Eligibility for Participation............................. 11
3.02 Determination of Eligibility by Committee................. 11
3.03 Duration of Eligibility................................... 11
3.04 Salary Reduction Agreement................................ 11
ARTICLE IV
Contributions Under the Plan............................................. 13
4.01 Basic Contributions....................................... 13
4.02 Matching Contributions.................................... 13
4.03 Payment of Contributions.................................. 14
4.04 Reversion of Certain Contributions Made by the Company.... 15
4.05 Participant Contributions................................. 15
4.06 Rollover Contributions.................................... 15
ARTICLE V
Participants' Accounts; Allocation of Assets and Contributions;
Participants' Investment Elections.................................... 17
5.01 Participants' Accounts.................................... 17
5.02 Allocation of Basic Contributions......................... 17
5.03 Allocation of Matching Contributions
(Including Forfeitures)................................... 18
5.04 Allocation of Rollover Contributions...................... 18
5.05 Valuation and Allocation of Assets........................ 18
5.06 Distributions and Forfeitures............................. 19
5.07 Election of Investments................................... 20
ARTICLE VI
Limitations on Contributions and Allocations............................. 22
6.01 Contributions to be Deductible............................ 22
6.02 Limitation on Basic Contributions......................... 22
6.03 Return of Excess Deferrals................................ 25
6.04 Limitation on Matching Contributions...................... 26
6.05 Limitations on Allocations................................ 29
6.06 Contributions from Net Earnings........................... 30
ARTICLE VII
Payments to or for the Account of Participants or Terminated Participants 31
7.01 Restrictions on Payments and Distributions................ 31
7.02 Retirement................................................ 31
7.03 Disability Retirement..................................... 31
7.04 Death Benefits............................................ 32
7.05 Termination of Employment Prior to Retirement or Death.... 34
(ii)
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7.06 Reemployment............................................... 35
7.07 Methods of Payment......................................... 35
7.08 Restrictions on Method and Timing of Payment............... 36
7.09 Withdrawals During Employment.............................. 38
7.10 Loans to Members........................................... 40
7.11 Discharge of Trustees' Obligation to Make Payments......... 42
7.12 Direct Rollovers........................................... 42
ARTICLE VIII
Amendment and Termination................................................. 45
8.01 Right to Amend or Terminate................................ 45
8.02 Amendment for Tax Exemption................................ 45
8.03 Liquidation of Trust in Event of Termination............... 45
8.04 Termination of Plan and Trust.............................. 46
ARTICLE IX
Administration of the Plan................................................ 47
9.01 Named Fiduciaries.......................................... 47
9.02 Appointment of Committee................................... 48
9.03 Powers of Committee........................................ 49
9.04 Action by Committee........................................ 49
9.05 Discretionary Action....................................... 50
9.06 Evidence on Which Committee May Act........................ 50
9.07 Employment of Agents....................................... 50
9.08 Compensation and Expense of Committee...................... 51
9.09 Indemnification of Committee Members....................... 51
ARTICLE X
The Trustees.............................................................. 52
10.01 Powers of Trustees........................................ 52
10.02 Investments............................................... 52
10.03 Method of Holding, Buying, and Selling Securities......... 53
10.04 Exercise of Rights........................................ 53
10.05 Reliance on Trustees as Owners............................ 54
10.06 Liquidation of Assets..................................... 55
10.07 Direction by Committee.................................... 55
10.08 Records and Accounting.................................... 55
10.09 Payment of Taxes.......................................... 56
10.10 Trustees' Compensation and Expenses....................... 57
10.11 Resignation or Removal of Trustees........................ 58
10.12 Appointment of Investment Managers........................ 58
10.13 Indemnification of Trustees............................... 60
(iii)
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ARTICLE XI
The Company............................................................... 61
11.01 No Contract of Employment................................. 61
11.02 No Contract to Maintain Plan.............................. 61
11.03 Liability of the Company.................................. 61
11.04 Action by the Company..................................... 62
11.05 Successor to Business of the Company...................... 62
11.06 Dissolution of the Company................................ 62
ARTICLE XII
Additional Participating Companies........................................ 64
12.01 Participation............................................. 64
12.02 Effective Date............................................ 64
12.03 Administration............................................ 64
12.04 Termination............................................... 64
ARTICLE XIII
Top-Heavy Provisions...................................................... 66
13.01 General Rule.............................................. 66
13.02 Minimum Contribution Provisions........................... 66
13.03 Top-Heavy Plan Definition................................. 67
13.04 Key Employee.............................................. 69
13.05 Non-Key Employee.......................................... 70
13.06 Limitation on Contributions............................... 70
ARTICLE XIV
Miscellaneous............................................................. 71
14.01 Spendthrift Provision..................................... 71
14.02 Appointment of Person to Receive Payment.................. 71
14.03 Construction.............................................. 72
14.04 Impossibility of Performance.............................. 72
14.05 Definition of Words....................................... 72
14.06 Titles.................................................... 72
14.07 Merger or Consolidation................................... 72
14.08 Claims Procedure.......................................... 73
14.09 Special Provisions for Certain Leased Employees........... 73
14.10 Effective Date of Amendment and Restatement............... 74
14.11 Execution of Agreement.................................... 74
(iv)
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FREEDOM CAPITAL MANAGEMENT CORPORATION
DEFERRED SAVINGS PLAN
AND TRUST AGREEMENT
This Trust Agreement is made as of the 1st day of January, 1989, by and
between FREEDOM CAPITAL MANAGEMENT CORPORATION, a Massachusetts corporation
having its principal places of business in Boston, Massachusetts (hereinafter
called the "Company"), and Xxxxxx X. Xxxx, Xxxxxx X. Xxxxx, Xx. and Xxxxx X.
Xxxxxxxxxx, Xx. (hereinafter called the "Trustees").
WITNESSETH THAT:
WHEREAS the Company recognized the contribution being made to the
successful operation of its business by its employees and desired to reward such
contribution and therefore established a profit sharing plan and trust entitled
"Xxxxxx Xxxxxxx Management Corporation Deferred Savings Plan and Trust
Agreement" which has been subsequently amended from time to time; and
WHEREAS the Company now desires to amend and restate said profit
sharing plan and trust in its entirety to comply with the Tax Reform Act of 1986
and other relevant legislative and regulatory changes, and to rename said profit
sharing plan and trust as the "Freedom Capital Management Corporation Deferred
Savings Plan and Trust Agreement" and to make various other changes thereto;
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NOW, THEREFORE, the Company and the Trustees, each in consideration of
the covenants, agreements, and declarations of the other, mutually covenant,
agree, and declare as follows:
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ARTICLE I
Introduction
1.01 Creation of Trust. There has been hereby established a trust known
as the "FREEDOM CAPITAL MANAGEMENT CORPORATION DEFERRED SAVINGS TRUST" (formerly
known as the "Xxxxxx Xxxxxxx Management Corporation Deferred Savings Trust
Agreement") (the "Trust"). The Trustees shall receive any contributions paid to
the Trust and all contributions so received, together with the income therefrom,
shall be held, managed, and administered as a fund in trust pursuant to the
terms of this Agreement. The Trustees hereby confirm their acceptance of the
Trust created hereunder and agree to perform the provisions of this Agreement on
their part to be performed.
1.02 Interpretation of Trust Agreement. The Trust is established for
the exclusive benefit of Eligible Employees and their Beneficiaries. So far as
possible, this Agreement shall be interpreted in a manner consistent with this
intent and with the intent of the Company that the Trust established hereunder
shall continue to be a profit sharing plan and to satisfy those provisions of
the Employee Retirement Income Security Act of 1974 ("ERISA") and of the
Internal Revenue Code of 1986 (the "Code") relating to exempt employees' trusts,
as either of them may from time to time be amended. Except as otherwise provided
in Section 4.04 hereof, under no circumstances shall any property, whether
corpus or income of the Trust hereunder, or any funds contributed to the Trust,
ever revert to or be used or enjoyed by the Company or be used for any purpose
other than for the exclusive benefit of the eligible Employees or their
Beneficiaries.
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ARTICLE II
Definitions
Whenever used in this Agreement, unless the context clearly indicates
otherwise, the following words shall have the following meanings:
2.01 "Affiliated Company" means (a) a corporation which, together with
the Company, is a member of a controlled group of corporations (as defined in
Section 414(b) of the Code), (b) a trade or business (whether or not
incorporated) which is under common control (as defined in Section 414(c) of the
Code) with the Company, (c) a corporation, partnership, or other entity which,
together with the Company, is a member of an affiliated service group (as
defined in Section 414(m) of the Code), or (d) any entity required to be
aggregated with the Company under Section 414(o) of the Code.
2.02 "Agreement" means this Agreement, as amended from time to time.
2.03 "Anniversary Date" means December 31 in each year.
2.04 "Basic Contributions" means the contributions made by the Company
pursuant to Section 4.01 of the Plan either in consideration of a Participant's
agreement to reduce his cash Compensation by a comparable amount pursuant to a
Salary Reduction Agreement or as a special Basic Contribution designed to cause
the test in Section 6.02(a)(i) or (ii) to be satisfied.
2.05 "Beneficiary" means the person or persons designated by a
Participant, pursuant to the provisions of Section 7.04 of this Agreement, to
receive distribution of such Participant's share upon his death, and includes a
co-beneficiary or a contingent beneficiary. The term "Beneficiary" also includes
a Participant's surviving spouse if such spouse is deemed to be such
Participant's Beneficiary pursuant to section 7.04.
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2.06 "Board of Directors" means the board of directors of the Company
in office from time to time or the Executive Committee of such board, with
respect to such powers as have been delegated to it by the Board.
2.07 "Committee" means the Administrative Committee constituted under
Article IX of this Agreement in office from time to time.
2.08 "Company" means Freedom Capital Management Corporation and also
means any successor to all or a major portion of its business which adopts this
Plan and Trust pursuant to Section 11.05.
2.09 "Compensation" of an Eligible Employee means the total salary and
wages paid by the Company to such Eligible Employee during the Plan Year while
such Eligible Employee is, or is eligible to be, an active Participant in the
Plan. Notwithstanding the foregoing, (i) Compensation shall include all amounts
which would have been paid to such Eligible Employee as Compensation but for an
election by such Eligible Employee under Section 125 or 401(k) of the Code, (ii)
Compensation shall not include contributions made by the Company to any other
benefit plan or any other form of compensation and (iii) an Eligible Employee's
Compensation for any Plan Year (A) shall not exceed $200,000 (subject to
cost-of-living adjustments made by the Secretary of Treasury or his delegate)
for any Plan Year commencing on or after January 1, 1989 and (B) shall not
exceed $150,000 (subject to cost-of-living adjustments made by the Secretary of
Treasury or his delegate) for any Plan Year commencing on or after January 1,
1994. In determining the Compensation of an Eligible Employee for purposes of
the limitations described in section (iii) of the preceding sentence for any
Plan Year, the rules of Section 414(q)(6) of the Code shall apply, except that
in applying such rules,
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the term "family" shall include only the spouse of the Eligible Employee and any
lineal descendants of the Eligible Employee who have not attained age nineteen
(19) before the close of such Plan Year. If the application of those rules
causes the adjusted dollar limitation to be exceeded, then the limitation shall
be prorated among the affected Eligible Employees in proportion to their
Compensation as determined under this Section 2.09 before the application of the
limitation.
2.10 "Eligible Employee" means any Employee who is employed on a
regular full-time basis whose customary work schedule is at least 1,000 Hour of
Service annually.
2.11 "Employee" means any person who is employed by the Company. An
Employee's employment shall be deemed to have commenced on the date on which he
first performs an Hour of Service as an Employee.
2.12 "Employment Commencement Date" means the first date on which an
individual performs an Hour of Service.
2.13 "Family Member" includes the spouse, lineal ascendants and
descendants of an Employee or former Employee and the spouses of such lineal
ascendants and descendants.
2.14 "Highly Compensated Employee" means either a highly compensated
active employee or a highly compensated former employee.
A highly compensated active employee means any Employee who performs
service for the Company during the "determination year" and who, during the
"look-back year": (i) received Compensation from the Company in excess of
$75,000 (as adjusted pursuant to Section 415(d) of the Code); (ii) received
Compensation from the Company in excess of $50,000 (as adjusted pursuant to
Section 415(d) of the Code) and was a member of the "top-
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paid group" for such year; or (iii) was an officer of the Company and received
Compensation during such year that is greater than 50 percent of the dollar
limitation then in effect under Section 415(b)(1)(A) of the Code. The term
Highly Compensated Employee also includes: (i) each Employee who is both
described in the preceding sentence if the term "determination year" is
substituted for the term "look-back year" and one of the one hundred (100)
Employees who received the most Compensation from the Company during the
determination year; and (ii) each Employee who is a 5-percent owner at any time
during the look-back year or determination year.
If no officer has satisfied the compensation requirement of (iii) above
during either the determination year or look-back year, the highest paid officer
for either such year shall be treated as a Highly Compensated Employee.
For this purpose, the determination year shall be the Plan Year. The
look-back year shall be the twelve-month period immediately preceding the
determination year. The top-paid group for any Plan Year shall be the group of
Employees consisting of the top twenty percent (20%) of the Employees when
ranked on the basis of Compensation paid during such Plan Year.
A highly compensated former employee includes any Employee who
separated (or was deemed to have separated) from service prior to the
determination year, performs no service for the Company during the determination
year, and was a highly compensated active employee for either the separation
year or any determination year ending on or after the Employee's 55th birthday.
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If an Employee is, during a determination year or look-back year, a
Family Member of either a 5-percent owner who is an active or former Employee or
a Highly Compensated Employee who is one of the top ten (10) Highly Compensated
Employees ranked on the basis of Compensation paid by the Company during such
year, then the Family Member and the 5-percent owner or top-ten Highly
Compensated Employee shall be aggregated. In such case, the Family Member and
5-percent owner or top-ten Highly Compensated Employee shall be treated as a
single Employee receiving Compensation and plan contributions or benefits equal
to the sum of such Compensation and contributions or benefits of the Family
Member and 5-percent owner or top-ten Highly Compensated Employee.
The determination of who is a Highly Compensated Employee, including
the determination of the number and identity of Employees in the top-paid group,
the top one hundred (100) Employees, the number of Employees treated as officers
and the Compensation that is considered, will be made in accordance with Section
414(q) of the Code and the regulations thereunder.
2.15 "Hour of Service" means:
(a) Each hour for which an employee is directly or indirectly paid
or entitled to payment by the Company or an Affiliated Company for the
performance of duties. These hours shall be credited to the employee for the
Plan Year(s) in which the duties are performed; and
(b) Each hour for which an employee is directly or indirectly paid
or entitled to payment by the Company or an Affiliated Company on account of a
period of time during which no duties are performed (irrespective of whether the
employment relationship has
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terminated) due to vacation, holiday, illness, incapacity (including
disability), layoff, jury duty or other similar reason. These hours shall be
calculated and credited pursuant to Section 2530.200b-2 of the Department of
Labor Regulations which are incorporated herein by reference; and
(c) Each hour for which back pay, irrespective of mitigation of
damages, has been either awarded or agreed to by the Company or an Affiliated
Company. The same hours shall not be credited under both paragraph (a) or
paragraph (b), as the case may be, and under this paragraph (c). These hours
shall be credited to the employee for the Plan Year(s) to which the award or
agreement pertains rather than the Plan Year in which the award, agreement, or
payment is made; and
(d) each hour credited, at the rate of forty (40) hours per week
for each week involved, for the following periods of time:
(i) Unpaid periods of absence authorized by the Company in
accordance with standard personnel policies of the Company, provided
the Employee returns to employment with the Company immediately upon
the expiration of such authorized absence.
(ii) Unpaid military leave while the Employee's reemployment
rights are protected by law, provided the Employee returns to
employment with the Company within the period prescribed by law.
2.16 "Investment Fund" or "Investment Funds" means one or more of the
funds established by the Committee for the investment of Plan assets, as more
fully described in Section 5.08.
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2.17 "Matching Contributions" means the contributions made by the
Company pursuant to Section 4.02. In addition, for purposes of Section 6.04,
"Matching Contributions", shall include any Matching Contributions and "optional
contributions" made under the Plan in respect to Plan Years commencing prior to
January 1, 1989.
2.18 "Net Earnings" for any Plan Year shall mean the net pre-tax income
of the Company, before deductions of contributions under this Plan, as is
determined under generally accepted accounting principles.
2.19 "Normal Retirement Age" means age sixty-five (65).
2.20 "Participant" means an Employee who is eligible to participate in
the Plan as determined under Article III of the Plan.
2.21 "Period of Service" means, with respect to each Employee, the sum
of all periods of time, expressed in years and fractions of years based on days,
which commence on an Employee's Employment Commencement Date or Reemployment
Commencement Date and end on the date the Period of Service is to be determined,
but excluding any Period of Severance of one year or more.
2.22 "Period of Severance" means the period of time, expressed in years
and fractions of years based on days, which commences on the Employee's
Severance from Service Date and ends on the date on which the Employee next
completes an Hour of Service.
2.23 "Plan" means the "FREEDOM CAPITAL MANAGEMENT CORPORATION DEFERRED
SAVINGS PLAN" as set forth herein, together with any and all amendments hereto.
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2.24 "Plan Year" means the fiscal year of the Trust, being the twelve
(12) months ending on each Anniversary Date.
2.25 "Reemployment Commencement Date" means the first day of the
calendar month in which the Employee performs an Hour of Service following a
Period of Severance which is not counted as a Period of Service.
2.26 "Salary Reduction Agreement" means the agreement entered into
between the Company and an Employee pursuant to the provisions of Section 3.04.
2.27 "Severance from Service Date" means the earliest of (a) the date
on which an Employee dies or quits, is discharged, or retires from the Company
or an Affiliated Company, (b) the first anniversary of the first date of a
period in which an Employee remains absent from service with the Company or an
Affiliated Company for any reason other than voluntary termination, retirement,
discharge, or death, including but not limited to, vacation, holiday, sickness,
disability, and approved leave of absence or layoff, or (c) solely for purposes
of Section 7.05(c), the second anniversary of the first date of a period in
which an Employee is absent because of a Maternity/Paternity Leave of Absence.
An Employee who has a suspension of employment of less than one year, or a
layoff not exceeding one year, will be deemed not to have quit or been
discharged if he returns to active employment with the Company or an Affiliated
Company at the end of such suspension or layoff. If a suspension of employment
or layoff exceeds one year, the Employee will be deemed to have quit or been
discharged at the end of such period.
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2.28 "Trust" means the trust fund created by this Agreement, including
all Investment Funds, and held by the Trustees hereunder, into which all
contributions and income thereon shall be paid and out of which all payments and
distributions shall be made.
2.29 "Trustees" means the individuals named herein as trustees and any
duly appointed successor trustee or trustees.
2.30 "Valuation Date" means such Anniversary Date and each other date
which the Committee in its sole discretion selects for the revaluation of the
Investment Funds.
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ARTICLE III
Participation
3.01 Eligibility for Participation. Each Eligible Employee who was a
Participant on December 31, 1988 shall continue to be a Participant on January
1, 1989, provided he is still an Eligible Employee on that date. Each other
Employee, including each Employee hired on or after January 1, 1989, shall be
eligible to become a Participant under the Plan on the first day he becomes an
Eligible Employee.
3.02 Determination of Eligibility by Committee. The determination of an
Employee's eligibility for membership under the Plan shall be made by the
Committee from the Company's records, and the Committee's decisions on these
matters shall be conclusive and binding upon all persons.
3.03 Duration of Eligibility. A Participant shall continue as an active
Participant until the earlier of (i) his termination of employment with the
Company, and (ii) the date he ceases to be an Eligible Employee, and except as
otherwise specifically provided herein, shall cease to be an active Participant
entitled to share in contributions hereunder upon such date. To the extent a
former Participant's accounts have not been fully distributed, such former
Participant shall be treated as a Participant for purposes of applying the
provisions of the Plan to such accounts. A former Participant shall be eligible
to become an active Participant under the Plan on the date he again becomes an
Eligible Employee.
3.04 Salary Reduction Agreement. Each Eligible Employee who is not an
active Participant may, but shall not be required to, elect to become a
Participant by entering into a Salary Reduction Agreement with the Company. The
terms of any such Salary Reduction
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Agreement shall provide that such Participant agrees to accept a reduction in
cash Compensation from the Company, in an amount equal to any whole number
percentage of his Compensation, in consideration of the Company's agreement to
contribute an equal amount into the Trust on his behalf; provided, such salary
reduction percentage shall not exceed fifteen percent (15%); and provided
further, such reduction shall not exceed $7,000 (or such greater dollar amount
as may be established from time to time by the Secretary of the Treasury under
Section 402(g) of the Code) in any calendar year. Such maximum percentage may be
increased or decreased at the discretion of the Board of Directors for any Plan
Year by a resolution adopted prior to the beginning of such Plan Year.
A Participant's Salary Reduction Agreement shall become effective on
such Participant's first pay period in the month which begins not less than
fifteen (15) days (or such shorter period as the Committee allows) after the
delivery of such Salary Reduction Agreement to the Company.
A Participant may elect to increase or decrease the percentage rate of
his salary reduction effective only as of the first day of January or July
during a Plan Year. Each such increase, decrease or suspension shall be made by
written notice filed with the Committee and shall be effective as soon as
practicable after such notice is filed with the Committee. A Participant may
completely suspend his salary reduction election at any time. A Participant may
recommence his salary reduction election effective as of the first day of any
payroll period by submitting a written election to the Committee. No change in
the percentage of a Participant's salary reduction shall be made at any other
time by the Participant and the salary
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reduction percentage in force at any time shall continue in force unless and
until changed in accordance with the provisions of the preceding sentences.
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ARTICLE IV
Contributions Under the Plan
4.01 Basic Contributions. For each month, the Company shall make a
Basic Contribution to the Trust on behalf of each Participant who has entered
into a Salary Reduction Agreement equal to the amount specified in said Salary
Reduction Agreement. In addition to the Basic Contributions made by the Company
pursuant to the preceding sentence, the Company may, in order to cause the test
in Section 6.02(a)(i) or (ii) to be satisfied for a Plan Year, make a special
Basic Contribution to the Trust for such Plan Year, which special Basic
Contribution shall be in an amount determined by the Company in its sole
discretion and shall be allocated for the benefit of all Participants who are
employed on the Anniversary Date of such Plan Year and are not Highly
Compensated Employees either (i) in proportion to each such Participant's
Compensation for such Plan Year or (ii) in equal dollar amounts on a per capita
basis, as shall be designated by the Company at the time such special Basic
Contribution is made. Notwithstanding anything hereinabove to the contrary,
Basic Contributions shall be subject to the limitations described in Article VI
of the Plan.
4.02 Matching Contributions. For each Plan Year, the Company shall make
a Matching Contribution to the Trust under the Plan for each Participant who
made Basic Contributions during any part of such Plan Year, equal to one hundred
percent (100%) of the Participant's Basic Contributions made during such Plan
Year (excluding any special Basic Contribution made during such Plan Year
pursuant to the second sentence of Section 4.01); provided, however, that the
Matching Contribution made by the Company under this Section 4.02 on behalf of
any Participant for any Plan Year shall not exceed two percent (2%) of such
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Participant's Compensation for such Plan Year. A Participant shall be eligible
for the Matching Contribution provided by this Section 4.02 if, and only if,
such Participant is an Employee on the Anniversary Date of such Plan Year.
The rate of Matching Contributions made under this Section 4.02 may be
increased or decreased at the discretion of the Board of Directors; provided
that no such adjustment may be made which would reduce the rate of Matching
Contributions without at least thirty (30) days prior written notice to all
Participants.
Notwithstanding the foregoing, the Company may, in order to cause the
test in Section 6.04(a)(i) or (ii) to be satisfied for a Plan Year, increase the
maximum percentage of a Participant's Compensation which it will contribute as a
Matching Contribution pursuant to this Section 4.02 on behalf of all
Participants who are employed on the Anniversary Date of such Plan Year and are
not Highly Compensated Employees.
4.03 Payment of Contributions.
(a) The Basic Contributions made by the Company on behalf of each
Participant with respect to each month shall be paid into the Trust by the
Company not later than thirty (30) days after the last day of such month and
deposited in the Investment Funds in the proportions designated by the election
of such Participant under Section 5.07 of the Plan. The special Basic
Contributions, if any, made by the Company pursuant to the second sentence of
Section 4.01 for any Plan Year shall be paid into the Trust not later than the
date required for such contributions to be deductible for Federal Income Tax
purposes for said Plan Year and deposited in the Investment Funds in the
proportion designated by the election of the Participant under Section 5.07 of
the Plan
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(b) The Matching Contributions made by the Company on behalf of
each Participant with respect to each Plan Year shall be paid into the Trust not
later than the date required for such contributions to be deductible for Federal
income tax purposes for such Plan Year and deposited in the Investment Funds in
the proportions designated by the election of such Participant under Section
5.07 of the Plan.
4.04 Reversion of Certain Contributions Made by the Company. All Basic
and Matching Contributions made pursuant to Sections 4.01 and 4.02 shall be made
upon the condition that such contributions are fully deductible for Federal
income tax purposes. In the event that any such deduction is disallowed in whole
or in part, then the Company may direct the Trustees to return the amount of
such contributions (to the extent disallowed) (decreased by losses attributable
to such amount, but not including any earnings attributable to such amount) to
the Company at any time within the twelve-month period commencing on the date of
disallowance. In the event that the Company shall make Basic and/or Matching
Contributions pursuant to Section 4.01 or 4.02 on the basis of a mistake of
fact, the Company may direct the Trustees to return the amount of such
contributions (decreased by losses attributable to such amount, but not
including any earnings attributable to such amount) to the Company at any time
within the twelve-month period commencing on the date of contribution. In no
event shall the return of a contribution hereunder cause any Participant's
accounts to be returned to less than they would have been had the nondeductible
or mistaken amount not been contributed.
4.05 Participant Contributions. No Participant contributions are
required or permitted under the Plan.
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4.06 Rollover Contributions. Notwithstanding anything to the contrary
elsewhere herein, any Participant may make contributions of all or any part of
(i) any amount received by such Participant from another plan and trust
qualified as an exempt employee benefit plan and trust under Sections 401(a) and
501(a) of the Code which constitutes, prior to January 1, 1993, a "qualified
total distribution" (within the meaning of Section 402(a)(5)(E)(i) of the Code),
or, after December 31, 1992, an "eligible rollover distribution" (within the
meaning of Section 401(a)(31) of the Code) or (ii) any amount received by such
Participant out of an individual retirement account which consists of a prior
rollover contribution from a qualified employee benefit plan which would have
constituted a qualified total distribution or an eligible rollover distribution,
whichever is applicable, and which, in any case, but for such contribution to
the Plan, would have been taxable income to such Participant.
(b) Contributions and transfers under this Section 4.07 shall be
paid to the Trustees in cash or such other form of property as is acceptable to
the Trustees and as is necessary to avoid imposition of tax on the distribution
and shall be credited to a separate book account maintained for such individual
under the Plan, which account shall be known as his "Rollover Account." A
Participant's Rollover Account shall be nonforfeitable at all times.
(c) Contributions made by a Participant pursuant to this Section
4.07 shall be disregarded in applying the limitations set forth in Article VI.
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ARTICLE V
Participants' Accounts;
Allocation of Assets and Contributions;
Participants' Investment Elections
5.01 Participants' Accounts. The Committee shall maintain the following
accounts for each Participant under the Plan: (a) a Basic Account to which Basic
Contributions made by the Company for the benefit of such Participant shall be
credited along with any matching contributions and optional contributions made
under the Plan in respect to Plan Years commencing before January 1, 1989; (b) a
Matching Account to which Matching Contributions made by the Company in respect
to Plan Years commencing after December 31, 1988 for the benefit of such
Participant shall be credited; and (c) a Rollover Account to which rollover
contributions made by the Participant pursuant to Section 4.06 shall be
credited. The rights of each Participant to the amounts allocated to his Basic
and Rollover Accounts shall be fully vested and nonforfeitable at all times.
5.02 Allocation of Basic Contributions. At the time of payment of any
Basic Contributions to the Trust (including any special Basic Contributions made
pursuant to the second sentence of Section 4.01), the Company shall deliver to
the Committee a schedule showing the name of each Participant and the amount of
Basic Contributions made on his behalf. The schedule shall also contain such
other information as the Committee may reasonably require for the proper
administration of the Plan. Upon receiving all such schedules with respect to
any period ending on a Valuation Date and after the account balances of the
Participants have been adjusted as provided in Section 5.05, the Committee shall
credit
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26
to the Basic Account of each Participant listed on such schedules the amount of
Basic Contributions made to the Trust on his behalf as shown therein.
5.03 Allocation of Matching Contributions (Including Forfeitures). As
soon as practicable after the end of each Plan Year, the Company shall deliver
to the Committee a schedule showing the name of each Participant who (a) was an
Employee of the Company on the Anniversary Date of such Plan Year, or (b) died,
retired on or after Normal Retirement Age or became disabled (within the meaning
of Section 7.03) during such Plan Year and the amount of Matching Contributions
(including forfeitures) made on his behalf pursuant to Section 4.02. The
schedule shall also contain such other information as the Committee may
reasonably require for the proper administration of the Plan. Upon receiving
such schedule with respect to a Plan Year and after the account balances of the
Participants have been adjusted as of such Anniversary Date as provided in
Section 5.05, the Committee shall credit to the Matching Account of each
Participant listed on such schedule the amount of the Matching Contribution
(including forfeitures) made to the Trust on his behalf as shown therein.
5.04 Allocation of Rollover Contributions. After the receipt of any
rollover contribution made by a Participant and after the account balances of
the Participants have been adjusted as provided in Section 5.05, the Committee
shall credit such rollover contribution to such Participant's Rollover Account
as of the Valuation Date coincident with or next following the receipt of such
rollover contribution.
5.05 Valuation and Allocation of Assets. The Investment Funds shall be
valued by the Trustees, as of each Valuation Date, according to such methods as
the Trustees may reasonably
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27
select in order to determine the fair market value of the assets of each such
Fund. As of each Valuation Date, each account maintained under the direction of
the Committee shall be adjusted to reflect the effect of income collected and
accrued, realized and unrealized profit and losses, expenses, and all other
transactions during the applicable period. All expenses of the Trust which are
allocable to a Participant account or Investment Fund shall be charged to such
account or Investment Fund. All such expenses allocable to an Investment Fund
shall be charged against all Participant accounts in the same proportion as the
amount credited to such Participant account and invested in such Investment Fund
bears to the total amount invested in such Investment Fund. All such expenses
allocable to a Participant account will be charged against the interest of such
account invested in each Investment Fund in the same proportion as each such
interest bears to the total value of the account. Such valuations and
adjustments of the Participants' accounts shall be made so as to preserve for
each account of each Participant its beneficial interest in each of the
Investment Funds. The value of a Participant account as of any Valuation Date
shall be the sum of the interests of the Participant account invested in each
Investment Fund as of the Valuation Date for each such Investment Fund which is
coincident with or immediately preceding the Valuation Date as of which the
Participant account is being valued.
5.06 Distributions and Forfeitures. Whenever the Trustees shall make
any distribution to or in behalf of a Participant in accordance with the
provisions of Article VII or whenever a Participant shall forfeit all or any
portion of his Matching Account in accordance with the provisions of Section
7.05, such Participant's accounts shall be charged with the amount of such
distribution or forfeiture. In the event of any distribution or forfeiture of
less than the full
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amount standing to the credit of a Participant's accounts, the amount charged
against such Participant's accounts shall be charged against such Participant's
interest in the Investment Funds in accordance with administrative policies
established by the Committee, or in the absence of any such policy, on a pro
rata basis. All distributions and forfeitures shall be based upon the value of
the Participant's accounts determined as of the Valuation Date next preceding
such distribution. The accounts of any Participant shall continue to be
maintained under the Plan and shall continue to share in the allocation of
income, gain, losses, appreciation, and depreciation of assets pursuant to
Section 5.05 until such accounts have been fully distributed.
5.07 Election of Investments.
(a) Each Participant shall have the right to elect the manner of
investment of the amounts standing to the credit of his accounts among the
Investment Funds established under the Trust. By such election, the Participant
shall direct the portion (in whole percentages) of the aggregate amount then
credited, and/or thereafter to be credited, to his accounts which is to be
invested by the Trustees in each of the Investment Funds. The Committee shall
maintain records of account at all times adequately reflecting each
Participant's interest in each of the Investment Funds. The Committee may
establish such procedures, forms, minimum investment amounts or other
limitations with respect to investment elections, as it may deem necessary or
advisable for the orderly administration of the Plan.
(b) Each Participant may, at such time or times and in such manner
as the Committee determines on a uniform basis for all Participants, elect to
change his investment
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election with respect to future contributions credited to any of such
Participant's accounts as well as amounts already credited to such accounts. In
the event that such a new election causes a transfer of assets from one
Investment Fund to another, the transfer shall be made by the Trustees as soon
as reasonably possible thereafter.
(c) Any investment election made hereunder shall continue to be
effective until properly revoked by the Participant. If, at any time, there
shall be no investment election in effect with respect to a Participant, the
Committee shall direct the Trustees to invest all amounts contributed in respect
of such Participant in such one or more of the Investment Funds as the Committee
shall, in its sole discretion, select on a uniform basis for all such
Participants.
(d) The Company, the Committee and the Trustees shall have no
responsibility for the investment elections of the Participants and shall incur
no liability on account of investing the assets of the Trust in accordance with
such directions.
(e) For purposes of this Section 5.08, all references to a
Participant shall include a former Participant and the Beneficiary of a deceased
Participant to the extent that such former Participant or Beneficiary has an
interest under the Trust.
(f) To make or change an investment election, each Participant
shall give notice to the Committee, by use of the investment direction system
maintained for such purposes by the Committee or its agent. To be effective,
such an investment election must be in accordance with any and all rules and
regulations established by the Committee for this purpose. Any direction made by
a Participant using the investment direction system
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maintained by the Committee or its agent shall be treated as a direction made
pursuant to Section 404(c) of ERISA.
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ARTICLE VI
Limitations on Contributions
and Allocations
6.01 Contributions to be Deductible. Basic Contributions and Matching
Contributions under the Plan with respect to a Plan Year shall not exceed that
amount which, when added to the contributions made by the Company for that Plan
Year to all other qualified pension or profit sharing plans maintained by the
Company, equals the maximum amount allowable as a deduction by the Company
pursuant to Section 404 of the Code with respect to such Plan Year.
6.02 Limitation on Basic Contributions.
(a) At any time during the Plan Year, the Committee may direct the
Company to suspend or reduce the amount of Basic Contributions with respect to
any Participant if the Committee determines that such suspension or reduction is
necessary to cause the test in either (i) or (ii) below to be met with respect
to the amount of Basic Contributions for such Plan Year:
(i) the Actual Deferral Percentage for the Highly
Compensated Employees who are eligible for Basic Contributions is not
more than the Actual Deferral Percentage for all other Employees who
are eligible for Basic Contributions multiplied by 1.25; or
(ii) The excess of the Actual Deferral Percentage for the
Highly Compensated Employees who are eligible for Basic Contributions
over the Actual Deferral Percentage for
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all other Employees who are eligible for Basic Contributions is not
more than two (2) percentage points, and the Actual Deferral Percentage
for the Highly Compensated Employees who are eligible for Basic
Contributions is not more than the Actual Deferral Percentage for all
other Employees who are eligible for Basic Contributions multiplied by
two (2).
For the purposes of this subsection (a), "Actual Deferral Percentage"
for a specified group of Employees for a Plan Year shall be the average of the
ratios (calculated separately for each Employee in such group) of (A) the amount
of Basic Contributions actually paid over to the Trust on behalf of the Employee
for such Plan Year to (B) the Employee's Compensation for the Plan Year. In
determining the deferral percentage of a Highly Compensated Employee described
in Section 414(q)(6)(A) of the Code who has a Family Member, the Basic
Contribution made on behalf of such Highly Compensated Employee and the
Compensation of such Highly Compensated Employee shall include the Basic
Contributions and Compensation of his Family Member(s), and such Family
Member(s) shall not be considered a separate Participant for purposes of
determining the Actual Deferral Percentage for any group under the Plan to the
extent required by Sections 414(q) and 401(a)(17) of the Code and any
regulations promulgated thereunder, and any reduction required pursuant to
subsection (b) below shall be allocated among the Highly Compensated Employee
and his Family Member(s) in proportion to the Basic Contributions of each such
individual.
(b) If, for any Plan Year, the Committee determines that the Basic
Contributions made on behalf of Highly Compensated Employees exceed the
limitation set forth in subsection (a) above, the Committee shall direct the
Trustees to reduce the Basic
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Contributions of the Highly Compensated Employees in order of their deferral
percentages, beginning with the highest of such percentages, to the extent
necessary to cause the Plan to meet the limitation set forth in subsection (a)
above. Any Basic Contributions so reduced, together with the income or loss
allocable thereto (determined in accordance with Section 6.02(c) below) shall be
distributed to the Highly Compensated Employee on whose behalf such
contributions were made no later than March 15 of the following Plan Year.
Notwithstanding the foregoing, to the extent provided in regulations issued by
the Secretary of the Treasury, the amount that would otherwise be distributed to
a Participant in accordance with the provisions of this Section 6.02 shall be
reduced by the amount, if any, distributed to the Participant for the year under
Section 6.03. Any Matching Contributions made in respect to Basic Contributions
which are reduced pursuant to this subsection (b), shall (along with any income
and less any loss allocable thereto determined in accordance with Section
6.04(c)) be forfeited and reallocated as provided in Section 7.05.
(c) The income or loss allocable to a Participant's Basic
Contributions which exceed the limitation of subsection (a) above shall be
determined by multiplying the investment gain or loss of such Participant's
Basic Account for the Plan Year in which such excess Basic Contributions arose
and the period following such Plan Year ending on the day of the withdrawal of
such excess contributions (the "gap period") by a fraction. The numerator of
this fraction is the amount of the Participant's excess Basic Contributions to
be distributed and the denominator is the amount credited to the Participant's
Basic Account as of the beginning of the Plan Year, increased by the Basic
Contributions allocable to such Account for such Plan Year and the gap period.
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(d) In calculating the Actual Deferred Percentage under subsection
(a) above, (1) all elective contributions that are made under any other plan of
the Company that is required to be aggregated with the Plan under Section
401(a)(4) or 410(b) of the Code (other than Section 410(b)(2)(A)(ii) of the
Code) shall be treated as made under this Plan, and (2) the individual ratios
described in the second paragraph of (a) above for each Highly Compensated
Employee will be determined by treating all plans maintained by the Company in
which such Highly Compensated Employee participates as a single plan.
(e) The Committee shall determine each Plan Year whether the
limitation set forth in subsection (a) above is met and its determination shall
be final and binding on all persons.
6.03 Return of Excess Deferrals. If, during any calendar year, more
than the maximum permissible dollar amount under Section 3.04 of the Plan (and
Section 402(g) of the Code) is allocated pursuant to one or more cash or
deferred arrangements to a Participant's accounts under this Plan and any other
plan described in Sections 401(k), 408(k), or 403(b) of the Code, the following
provisions shall apply:
(a) no later than March 1 of the next succeeding calendar year,
the Participant may, but is not required to, allocate all or part of such
contributions in excess of the maximum permissible dollar amount ("excess
deferrals") to this Plan. To be effective, such allocation must be in writing,
state that excess deferrals have been made on behalf of such Participant for the
preceding calendar year, and be submitted to the Committee; and
(b) to the extent a Participant allocates excess deferrals in a
timely manner to this Plan pursuant to (a) above, the Committee shall direct the
Trustees to return such excess
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deferrals, as adjusted for income or losses, to the Company for distribution to
the Participant no later than the April 15 following such allocation.
6.04 Limitation on Matching Contributions.
(a) At any time during the Plan Year, the Committee may direct the
Company to suspend or reduce the amount of Matching Contributions with respect
to any Participant at any time during the Plan Year, if the Committee determines
that such suspension or reduction is necessary to cause the test in either (i)
or (ii) below to be met with respect to such contributions for such Plan Year:
(i) the Actual Contribution Percentage for the Highly
Compensated Employees who are eligible for Matching Contributions, is
not more than the Actual Contribution Percentage for all other
Employees who are eligible for Matching Contributions, multiplied by
1.25; or
(ii) the excess of the Actual Contribution Percentage for the
Highly Compensated Employees who are eligible for Matching
Contributions, over the Actual Contribution Percentage for all other
Employees who are eligible for Matching Contributions, is not more than
two (2) percentage points, and the Actual Contribution Percentage for
the Highly Compensated Employees who are eligible for Matching
Contributions, is not more than the Actual Contribution Percentage for
all other Employees who are eligible for Matching Contributions,
multiplied by two (2).
For purposes of this subsection (a), the "Actual Contribution
Percentage" for a specified group of Employees for a Plan Year shall be the
average of the ratios (calculated separately for each Employee in such group) of
(A) the Matching Contributions actually paid
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over to the Trust on behalf of the Employee for such Plan Year to (B) the
Employee's Compensation for the Plan Year. In determining the contribution
percentage of a Highly Compensated Employee described in Section 414(q)(6)(A) of
the Code who has a Family Member, the Matching Contributions made on behalf of
and the Compensation of such Highly Compensated Employee shall include the
Matching Contributions and Compensation of his Family Member(s), and such Family
Member(s) shall not be considered a separate Participant for purposes of
determining the Actual Contribution Percentage for any group under the Plan to
the extent required by Sections 414(q) or 401(a)(17) of the Code and any
regulations promulgated hereunder, and any reduction required pursuant to
subsection (b) below shall be allocated among the Highly Compensated Employee
and his Family Member(s) in proportion to the Matching Contributions of each
such individual.
(b) If, for any Plan Year, the Committee determines the Matching
Contributions made on behalf of Highly Compensated Employees exceed the
limitation set forth in subsection (a) above, the Committee shall direct the
Trustees to reduce the Matching Contributions made on behalf of the Highly
Compensated Employees, in order of their contribution percentages beginning with
the highest of such percentages, by the amount necessary to cause the Plan to
meet such limitation for such Plan Year. All such Matching Contributions in
which the Highly Compensated Employee is fully vested under Section 7.05,
together with the income and loss allocable thereto (determined in accordance
with Section 6.04(c) below), shall be distributed to the Highly Compensated
Employee on whose behalf such contributions were made no later than March 15 of
the following Plan Year. All such Matching Contributions which with respect to
which the Highly Compensated employee
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is not fully vested under Section 7.05, plus any income and minus any loss
allocable thereto (determined in accordance with Section 6.04(c) below), shall
be forfeited no later than March 15 of the following Plan Year and shall be
reallocated as provided in Section 7.05.
(c) The income or loss allocable to a Participant's Matching
Contributions which exceed the limitation set forth in subsection (a) above
shall be determined by multiplying the investment gain or loss of such
Participant's Matching Account for the Plan Year in which such excess
contributions arose and the period following such Plan Year ending on the day
the excess contributions are distributed or forfeited (the "gap period") by a
fraction. The numerator of this fraction is the amount of the Participant's
excess contributions to be distributed and the denominator is the amount
credited to the Participant's Matching Account as of the beginning of the Plan
Year, increased by the contributions allocated to such Account for the Plan Year
and the gap period.
(d) The sum of the Actual Deferral Percentage of Highly
Compensated Employees under Section 6.02(a) and the Actual Contribution
Percentage of Highly Compensated Employees under subsection (a) above shall not
exceed the "aggregate limit," as defined in the regulations promulgated under
Section 401(m) of the Code.
If the aggregate limit is exceeded, the Actual Contribution Percentage
of the Highly Compensated Employees shall be reduced in accordance with the
provisions of Section 6.04(b) above. In lieu of reducing the Actual Contribution
Percentage, however, the Committee may reduce the Actual Deferral Percentage of
the Highly Compensated Employees in accordance with the provisions of Section
6.02(b). The reductions under this Section shall be made only
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to the extent necessary to comply with the restrictions on the multiple use of
the "alternative limitation" within the meaning of Section 401(m)(9) of the
Code.
(e) In calculating the Actual Contribution Percentage under
subsection (a) above, (1) all employee and matching contributions that are made
under any other plan of the Company that is required to be aggregated with the
Plan under Section 401(a)(4) or 410(b) of the Code (other than Section
410(b)(2)(A)(ii) of the Code) shall be treated as made under this Plan, and (2)
the individual ratios described in the second paragraph of (a) above for each
Highly Compensated Employee will be determined by treating all plans maintained
by the Company in which such Highly Compensated Employee participates as a
single plan.
(f) The Committee shall determine each Plan Year whether the
limitations set forth in Subsections (a) and (d) above are met and its
determination shall be final and binding on all persons.
6.05 Limitations on Allocations. Notwithstanding anything hereinabove
to the contrary, the sum of the amounts credited to the accounts of any
Participant for any Plan Year pursuant to Section 5.02 (dealing with Basic
Contributions), Section 5.03 (dealing with Matching Contributions) and this
Section 6.05 shall be reduced to the extent that such amounts would cause the
sum of all such contributions credited to the accounts of such Participant under
the Plan for such Plan Year to exceed the lesser of (a) $30,000 (or, if greater,
one-fourth of the defined benefit dollar limitation set forth in Section 415(b)
of the Code, as adjusted pursuant to Section 415(d) of the Code), or (b)
twenty-five percent (25%) of such Participant's total compensation (determined
in accordance with Section 415 of the Code and the regulations
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39
thereunder) for such Plan Year. Any reductions required pursuant to the
foregoing sentence shall be made in the following order:
(i) the Basic Contributions allocated to such Participant's
Basic Account pursuant to Section 5.02 shall be reduced first; and
(ii) the Matching Contributions allocated to such
Participant's Matching Account pursuant to Section 5.03 shall be
reduced next.
In the event any reduction is required pursuant to subsection (i) above, the
amount of such reduction shall be held unallocated by the Trustees and shall be
reapplied in such a way as to reduce succeeding Basic Contributions on behalf of
such Participant under the Plan. In the event any reduction pursuant to (ii)
above is required, the amount of such reduction shall be applied toward the
Matching Contributions required to be made under Section 4.02 for the first pay
period ending after the date of the reduction.
In addition to the above limitations, the sum of each Participant's
defined benefit plan fraction (as defined in Section 415(e)(2) of the Code) and
defined contribution plan fraction (as defined in Section 415(e)(3) of the Code)
for any Plan Year shall not exceed 1.0. If any reduction or adjustment is
required in order to comply with the limitation in the preceding sentence, it
shall be made under the applicable defined benefit plan.
6.06 Contributions from Net Earnings. All Matching Contributions made
by the Company pursuant to Section 4.02 for any period are profit-sharing
contributions and, as such, shall be made from the Net Earnings of the Company
for such period or from its Net Earnings accumulated prior to such period.
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ARTICLE VII
Payments to or for the Account of
Participants or Terminated Participants
7.01 Restrictions on Payments and Distributions. No money or other
property of the Trust shall be paid out or distributed by the Trustees except
(a) for the purchase or other acquisition of appropriate investments, (b) for
defraying the expenses, including taxes, if any, of administering the Trust as
elsewhere herein provided, (c) for the purpose of making distributions to or for
the account of Participants at the written direction of the Committee in
accordance with the rules set forth below; (d) for the return of Company
contributions pursuant to Section 4.04 or (e) for the purpose of complying with
the terms of a qualified domestic relations order, within the meaning of Section
414(p) of the Code. All benefits payable under the Plan shall be paid or
provided for solely from the Trust, and the Company assumes no liability or
responsibility therefor.
7.02 Retirement. A Participant shall become fully vested in all his
accounts upon attainment of Normal Retirement Age. Upon retirement of a
Participant, which shall be deemed to mean any termination of his employment
with the Company at or after his Normal Retirement Age, the full amount then
standing to the credit of such Participant's accounts shall be distributed to
him or applied for his benefit as provided in Section 7.07. A Participant who
remains in the active employ of the Company after attaining Normal Retirement
Age shall continue as a Participant for all purposes of the Plan until the date
of his actual retirement.
7.03 Disability Retirement. If a Participant has applied and qualifies
for disability benefits under the Social Security Act or the Company's long-term
disability plan, the
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Committee shall direct the Trustees to apply the full amount then standing to
the credit of such Participant's accounts for his benefit as provided in Section
7.07.
7.04 Death Benefits.
(a) Upon the death of any Participant who has a surviving spouse,
the Committee shall direct the Trustees to distribute the full amount standing
to the credit of such Participant's accounts to the Participant's surviving
spouse, unless the exception provided by paragraph (b) of this Section 7.04
applies.
(b) The requirement of subsection (a) of this Section 7.04 shall
not apply if (i) the Participant elects to designate a Beneficiary other than
his spouse and his spouse (A) consents in writing to such election, (B) such
election designates a beneficiary which may not be changed without the consent
of the spouse (or the consent of the spouse expressly permits designations by
the Participant without any requirement of further consent by the spouse), and
(C) the spouse's consent acknowledges the effect of such election and is
witnessed by a Plan representative or a notary public, or (ii) if it is
established to the satisfaction of the Committee that the consent of the
surviving spouse could not have been obtained because there is no spouse,
because the spouse cannot be located, or because of other circumstances
prescribed by regulations under Section 417(a)(2) of the Code.
A former spouse shall be treated as a surviving spouse to the
extent benefits must be paid to such former spouse upon the Participant's death
pursuant to a qualified domestic relations order (as defined in Section 414(p)
of the Code), except that no consent shall be required from such former spouse
with respect to the designation of a Beneficiary to receive benefits not subject
to said order.
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(c) If, and only if, a Participant is not married or, if married,
is permitted under this Section 7.04 to designate a Beneficiary other than his
surviving spouse, then such Participant's accounts shall be distributed in
accordance with this subsection (c) of Section 7.04. Such a Participant shall
have the right to designate one or more Beneficiaries, including contingent
Beneficiaries, entitled to receive the amount payable in behalf of such
Participant under the provisions of this Plan in the event of death. Such
designation shall be made in writing in such manner as the Committee shall
determine. A Participant may change such designation from time to time, and may
revoke such designation, provided, however, that any subsequent designation must
meet the requirements of this Section 7.04. Upon the death of any Participant,
the Committee shall direct the Trustees to distribute, for the benefit of such
Participant's Beneficiaries and subject to the provisions of Section 7.08, the
full amount standing to the credit of the Participant's accounts. If a
Participant dies without having designated a Beneficiary, or if none of the
designated Beneficiaries survives the Participant, or if the Committee is in
doubt as to the effective status of a Beneficiary designation, payment of any
sum that would otherwise have been payable to such Beneficiary will be made to
the first surviving class of the following classes of successive preference
Beneficiaries, all members of such class to share equally: the Participant's (i)
surviving spouse; (ii) surviving issue (including adopted children and
stepchildren), per stirpes; (iii) surviving parents; (iv) brothers and sisters,
in equal shares; and (v) executors and administrators. If a Beneficiary entitled
to receive any amount payable in behalf of a Participant dies before receiving
the entire amount to which such Beneficiary is entitled, the undistributed
balance, together with any income or loss
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accumulated thereon, shall be distributed to such Beneficiary's estate in
accordance with Section 7.07.
7.05 Termination of Employment Prior to Retirement or Death.
(a) If any Participant's employment with the Company terminates
under circumstances other than by reason of retirement, disability or death, as
provided for under Sections 7.02 through 7.04, he shall be entitled to a vested
benefit equal to the sum of (i) 100% of the amounts standing to the credit of
his Basic Account and Rollover Account, plus (ii) that percentage of the amount
standing to the credit of his Matching Account, based upon his Periods of
Service, as follows:
Periods Vested
of Service Percentage
---------- ----------
Less than 3 0%
3 or more 100%
A Participant whose employment with the Company terminates and who
immediately thereafter becomes an employee of an Affiliated Company shall not be
considered to have terminated his employment for purposes of this Section until
his employment with the Affiliated Company subsequently terminates.
The vested benefit determined in accordance with the foregoing
provision shall never be adjusted or altered in any fashion on account of any
Periods of Service which the Participant might complete upon reemployment with
the Company or an Affiliated Company after a Period of Severance, except as
provided in Section 7.06.
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(b) The determination of the amount to which such terminated
Participant is entitled in accordance with the foregoing rules shall be made by
the Committee and communicated to the Trustees.
(c) Any amount standing to the credit of a Participant's Matching
Account to which he is not entitled at the time of his termination of employment
shall be forfeited by him upon the earlier of the payment of the full amount to
which such Participant is entitled under the Plan or the incurrence of a Period
of Severance of five (5) years by the Participant. For purposes of the preceding
sentence, a terminated Participant who is not entitled to receive any amount
under the Plan shall be deemed to have received the entire amount to which he is
entitled on the date his employment terminates and shall forfeit his entire
Matching Account as of that date. At the close of the Plan Year in which any
forfeitures occur, all such forfeited amounts shall be applied to reduce the
Company's Matching Contribution for such Plan Year.
7.06 Reemployment. If a terminated Participant is reemployed by the
Company, he shall again become an active Participant upon reemployment pursuant
to Section 3.03.
If such a reemployed Participant was not 100% vested in his Matching
Account under Section 7.05(a) at the time of his prior termination, the
following special provisions shall apply:
(a) If such a terminated Participant is reemployed after incurring
a Period of Severance of five (5) years (as defined in Section 7.05), he shall
have no rights with respect to any amounts previously forfeited from his
Matching Account.
(b) If such a terminated Participant is reemployed before
incurring a Period of Severance of five (5) years the full amount, if any, which
was forfeited from his Company
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Account as a result of his prior termination shall be restored to his Matching
Account as of the date of reemployment.
7.07 Methods of Payment.
(a) Whenever under this Article VII any amount is required to be
distributed or applied for the benefit of any Participant or Beneficiary or
other person, such distribution shall be made in one lump sum payment in cash.
(b) Whenever during any Plan Year the amount standing to the
credit of a Participant's accounts becomes distributable pursuant to Sections
7.02 through 7.05, distribution at such retirement, disability, death or other
termination of employment, as the case may be, shall be made or commenced within
a reasonable time after the latest of (1) the end of the Plan Year in which such
termination occurs, (2) the determination of the allocation to which the
Participant is entitled under Section 5.03 with respect to such Plan Year, or
(3) if Section 7.08(a) is applicable to such Participant, the date the
Participant consents to a distribution pursuant to that Section.
7.08 Restrictions on Method and Timing of Payment. Notwithstanding any
provision to the contrary, in order to comply with Sections 401(a)(9),
411(a)(11) and 414(p) of the Code, the following provisions shall apply:
(a) If the sum of a Participant's account balances to be
distributed upon retirement or severance or disability under Section 7.02, 7.03
or 7.05 is greater than $3,500, such account balances shall not be distributed
in whole or in part until the earlier of (i) the date the Participant attains
Normal Retirement Age or (ii) the Participant's death, unless the Participant
consents to such earlier distribution in writing.
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(b) In no event shall the distribution of a Participant's
Accounts, unless the Participant otherwise elects, begin later than the 60th day
after the close of the Plan Year in which the later of the following events
occurs:
(i) the Participant's sixty-fifth (65th) birthday;
(ii) the tenth (10th) anniversary of the date on which the
Participant first became a Participant, or
(iii) the Participant's termination of service with the
Company (and any Affiliated Company).
(c) In no event shall distribution of benefits to a Participant
begin later than the April 1 next following the calendar year in which such
Participant attains age seventy and one-half (70-1/2) (the "Required
Distribution Date"). Notwithstanding the foregoing, the Required Distribution
Date for any Participant (i) who is not a "five-percent owner" (within the
meaning of Section 416(i)(1)(B)(i) of the Code) at any time during the five Plan
Year period ending in the calendar year in which the Participant attains age
70-1/2 and (ii) who attains age 70-1/2 before January 1, 1988, shall be no
earlier than the April 1 next following the calendar year in which the
Participant terminates employment with the Company.
(d) In the event a Participant dies before his Required
Distribution Date and his surviving spouse is not his Beneficiary, his entire
interest shall be paid to his Beneficiary in a lump sum no later than December
31 of the calendar year containing the fifth (5th) anniversary of the
Participant's death. If the Participant's Beneficiary is his surviving spouse,
the Participant's entire interest shall be paid to his surviving spouse in a
lump sum no later than the December 31 of the calendar year in which the
Participant would have attained age
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seventy and one-half (70-1/2). If the spouse dies before said date, subsequent
distributions shall be made as if the spouse had been the Participant. Life
expectancy will be calculated in accordance with Treasury Regulation Section
1.72-9 and regulations promulgated under Section 401(a)(9) of the Code.
(e) If, and to the extent that, any portion of a Participant's
account balances is payable to a former spouse or dependent pursuant to a
qualified domestic relations order within the meaning of Sections 401(a)(13)(B)
and 414(p) of the Code, the provisions of said order shall govern the
distribution thereof. Such an order may provide for payments to a former spouse
or dependent even though the Participant is still employed by the Company or is
otherwise not eligible for the distribution of benefits under the Plan.
7.09 Withdrawals During Employment.
(a) Upon written notice to the Committee at least thirty (30) days
(or such shorter period as the Committee allows) prior to a Valuation Date, a
Participant may at any time during his employment with the Company withdraw all
or any portion of the vested portion of the amount (determined as of such
Valuation Date) standing to the credit of his Basic Account and Matching
Account, excluding any outstanding loan amounts with respect to such accounts,
but only in order, and to the extent necessary, to meet a "Financial Hardship"
and to pay the amount of any taxes reasonably anticipated to result from such
withdrawal; provided, no such withdrawal from the Participant's Basic Account
may exceed the aggregate amount of the Basic Contributions made on his behalf by
the Company plus any earnings credited to his Basic Account as of December 31,
1988 (if any), reduced by the sum of all prior withdrawals from such
Participant's Basic Account. The determination that the Participant is faced
with a
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Financial Hardship and of the amount required to meet such Financial Hardship
which is not reasonably available from other resources of the Participant shall
be made by the Committee in accordance with uniform and nondiscriminatory
standards and policies which shall be adopted by the Committee and consistently
applied to each application for a withdrawal pursuant to this Section 7.09. For
purposes of this Section 7.09, "Financial Hardship" shall mean an immediate and
heavy financial need which such Participant is not able to meet from any other
reasonably available resources. In determining that such Participant is not able
to meet such Financial Hardship from any other sources, the Committee may
reasonably rely upon the written certification of the Participant given in
accordance with the regulations under Section 401(k). Subject to the foregoing
and the requirements of Section 401(k) of the Code and any regulations
thereunder, the term "Financial Hardship" shall mean and include the following:
(i) the purchase (excluding mortgage payments) of a
principal residence of the Participant;
(ii) the payment of the tuition for the next twelve months
of post- secondary education for the Participant, his spouse, children,
or dependents;
(iii) the payment of medical expenses described in Section
213(d) of the Code which are incurred by the Participant, his spouse or
any dependent, and which are not covered by insurance; or
(iv) the need to prevent an eviction or mortgage foreclosure
on the Participant's principal residence.
(b) A Participant may specify that a withdrawal under this Section
7.09 is to be charged to his interest in one or more specific Investment Funds
in which the account
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charged with the withdrawal is invested. Unless so specified, distribution will
be made out of the interests of such account in each Investment Fund in
accordance with the proportion which the interest of such account in such
Investment Fund bears to the total value of such account, subject however to
such restrictions as may be applicable to the particular Investment Funds. The
amount to be withdrawn for any in-service withdrawal pursuant to this Section
7.09 shall be charged against the Members' accounts in the following order: his
Matching Account and then his Basic Account.
(c) All withdrawals under this Section 7.09 shall be made as soon
as practicable after the Valuation Date next following timely receipt by the
Committee of the Participant's written notice.
7.10 Loans to Members. Upon written application of a Participant
submitted to the Committee at least thirty (30) days (or such shorter period as
the Committee allows) prior to a Valuation Date, the Committee may direct the
Trustees to lend to such Participant such amount or amounts from his accounts,
as the Committee may determine proper, up to fifty percent (50%) of the total
aggregate vested value of all such Participant's accounts but only for one of
the purposes enumerated in Section 7.09 or such other type of financial
emergency as the Committee may deem appropriate in accordance with Section 9.05,
provided that the aggregate amount of all outstanding loans, including accrued
interest, from the Plan to a Participant shall not exceed $50,000, reduced by
the amount of any loan repayment of principal made during the one (1) year
period ending on the day before the date on which such loan is to be made. A
Participant may not have more than three loans outstanding under this Section
7.10 at any given time.
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Loans shall be made available to all Participants on a reasonably
equivalent basis, except that the Committee may make reasonable distinctions
based upon credit-worthiness, other obligations of the Participant and other
factors that may adversely affect the ability to assure repayment. Loans
approved under this Section 7.10 shall be made as soon as reasonably practicable
after the Valuation Date next following timely receipt by the Committee of the
Participant's written application.
Each such loan shall be made at such reasonable rate of interest as the
Committee may determine, and shall be subject to such other terms and conditions
as the Committee may deem proper, and shall be evidenced by the promissory note
of the Participant and secured by fifty percent (50%) of the Participant's
interest in the Plan. Each such loan shall be repaid by such means as may be
authorized by the Committee, shall be amortized over the term of the loan in
level payments made not less frequently than quarterly, and shall be repaid
within five (5) years; provided, however, the Committee may establish rules and
procedures which permit repayment periods in excess of five years for a loan
used to acquire a dwelling unit which within a reasonable period of time is to
be used (determined at the time the loan is made) as the principal residence of
the Participant.
Each such loan shall be deemed to be an investment made at the
direction of such Participant and shall be credited to a separate investment
account for the borrowing Participant. An amount equal to the principal amount
of such loan when made shall be charged to the interests of such Participant's
accounts as designated by the Participant.
Subject to such restrictions as may be applicable to the particular
Investment Funds, in the event of a loan of less than the entire balance of a
Participant's account, the loan amounts
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shall be withdrawn from the Investment Funds pro rata in proportion to the
interest of such account in each of such Investment Funds. All interest and loan
repayments shall be credited to the appropriate accounts of such Participant and
shall be reinvested in the Investment Funds in accordance with the most recent
investment election of such Participant with respect to contributions credited
to such accounts. All expenses incurred by the Committee and the Trustees,
including reasonable attorneys' fees and court costs, as a result of a default
by a Participant shall be charged against the Participant's accounts.
If any loan under this Section 7.10 is in default, as determined in
accordance with the procedures established by the Committee, while any part or
all of the amount standing to the credit of a Participant's accounts becomes
distributable to such Participant or his Beneficiary, the Committee shall direct
the Trustees to apply the amount of such distributable amount in payment of the
entire outstanding loan principal, and any interest theretofore accrued, before
distributing the balance, if any, to the Participant or his Beneficiary.
7.11 Discharge of Trustees' Obligation to Make Payments. Whenever the
Trustees are required to make any payment or payments to any person in
accordance with the provisions of this Article VII or Article VIII, the
Committee shall notify the Trustees in writing of such person's last known
address as it appears in the Committee's records; and the obligations of the
Trustees and the Committee to make such payment or payments shall be fully
discharged by mailing the same to the address specified by the Committee.
7.12 Direct Rollovers.
(a) Notwithstanding any provision of the Plan to the contrary that
would otherwise limit a distributee's election under this Section, a distributee
may elect, at the time
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and in the manner prescribed by the Committee, to have any portion of an
eligible rollover distribution paid directly to an eligible retirement plan
specified by the distributee in a direct rollover.
(b) Whenever used in this Section 7.12, the following words shall
have the following meanings:
(i) 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 section 401(a)(9) of the Code; and the portion of any
distribution that is not includible in gross income (determined without
regard to the exclusion for net unrealized appreciation with respect to
employer securities).
(ii) Eligible retirement plan: an eligible retirement plan
is an individual retirement account described in section 408(a) of the
Code, an individual retirement annuity described in section 408(b) of
the Code, an annuity plan described in section 403(a) of the Code, or a
qualified trust described in section 401(a) of the Code, that accepts
the distributee's eligible rollover distribution. However, in the case
of an eligible rollover distribution to the surviving spouse, an
eligible retirement plan is an individual retirement account or
individual retirement annuity.
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(iii) Distributee: A distributee includes an employee or
former employee. In addition, the employee's or former employee's
surviving spouse and the employee's or former employee's spouse or
former spouse who is the alternate payee under a qualified domestic
relations order, as defined in section 414(p) of the Code, are
distributees with regard to the interest of the spouse or former
spouse.
(iv) Direct rollover: A direct rollover is a payment by the
Plan to the eligible retirement plan specified by the distributee.
(c) Notwithstanding anything above to the contrary, the Committee
may establish, in its discretion, such uniform restrictions with respect to the
payment of direct rollover distributions as may be permitted under Section
401(a)(31) of the Code and the regulations promulgated thereunder.
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ARTICLE VIII
Amendment and Termination
8.01 Right to Amend or Terminate. The Company reserves the right at any
time and from time to time to amend this Agreement, or discontinue or terminate
the Plan and Trust by delivering to the Committee and the Trustees a copy of an
amendment or appropriate Board of Directors' resolution of discontinuance or
termination certified by an officer of the Company; provided, however, that
except as provided in Section 8.02, the Company shall have no power to amend or
terminate this Agreement in such manner as would cause or permit (a) any of the
Trust assets to be diverted to purposes other than for the exclusive benefit of
the Employees of the Company or their Beneficiaries; (b) any reduction in the
amount theretofore credited to any Participant; (c) any portion of the Trust
assets to revert to or become the property of the Company; (d) the rights and
responsibilities of the Committee or the Trustees to be increased without their
written consent, and/or (e) the elimination of an optional form of benefit with
respect to amounts credited to a Participant's accounts before the amendment.
8.02 Amendment for Tax Exemption. The Company reserves the right to
amend this Agreement and the Plan and Trust hereunder in such manner as may be
necessary or advisable so that said Trust may continue to qualify as an exempt
employees' trust under the provisions of the Code; and any such amendment may be
made retroactively.
8.03 Liquidation of Trust in Event of Termination. In the event of
termination or partial termination (within the meaning of Section 411(d)(3) of
the Code) of this Plan and Trust, or complete discontinuance of contributions
thereto by the Company, the rights of all Participants (or in the case of a
partial termination, the rights of Participants affected thereby)
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to amounts theretofore credited to all their accounts shall be fully vested and
nonforfeitable. In the event of such termination or discontinuance, the Trustees
shall, subject to the direction of the Committee, hold the assets of the Trust
in accordance with the provisions of the Plan and distribute such assets from
time to time to Participants entitled thereto in accordance with such
provisions.
8.04 Termination of Plan and Trust. This Agreement and the Plan and
Trust hereunder shall in any event terminate whenever all property held by the
Trustees shall have been distributed in accordance with the terms hereof.
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ARTICLE IX
Administration of the Plan
9.01 Named Fiduciaries. The named fiduciaries with respect to the Plan
shall be the Company, the Committee and the Trustees. The Company shall be the
"plan administrator" of the Plan for all purposes of ERISA. The responsibilities
of the named fiduciaries shall be allocated as provided herein, and each such
fiduciary shall have only those responsibilities and obligations that are
specifically imposed upon it by this Trust Agreement or by applicable law. It is
intended that each of the named fiduciaries shall be responsible for the proper
exercise of its own powers, duties, responsibilities, and obligations under the
Plan and shall not be responsible for any act or omission of any other
fiduciary. The Company, the Trustees, and the Committee, as named fiduciaries,
shall be entitled to delegate all or any part of their fiduciary
responsibilities, and obligations to any other person or entity. In the event of
any such delegation, (a) the named fiduciary shall not be liable for any act or
omission of the person to whom the responsibility has been delegated as long as
the selection and retention of such person is prudent and (b) the person to whom
the fiduciary powers and obligations are delegated shall be responsible only for
the proper exercise of the powers, duties, responsibilities, and obligations
that have been specifically delegated to him. The responsibilities of the named
fiduciaries are:
(i) The Company shall have the sole responsibility to
appoint and remove (in accordance with Section 10.11) the Trustees and
successor Trustees, to appoint and remove or replace the members of the
Committee as herein provided, and
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shall have such other powers and do such other things as are herein
specifically provided.
(ii) The Trustees shall, except as otherwise specifically
provided in this Agreement, have the sole responsibility for the
investment and control of the assets of the Plan and Trust in
accordance with the terms hereof, and for the appointment, retention,
and/or removal of any Investment Manager.
(iii) The Committee shall have the sole responsibility for
the general administration of the Plan and for carrying out its
provisions. In addition, the Committee shall have such powers and
responsibilities as are herein specifically provided.
The Committee shall conduct its business in accordance with the terms of this
Article IX.
9.02 Appointment of Committee. The Company shall appoint a Committee of
two or more persons, any or all of whom may be officers or employees of the
Company or any other individuals. Each Trustee shall be deemed to have been
appointed a member of the Committee by the Company if the Company has not
appointed any other persons to be members of the Committee. If the Committee
consists of no members other than the Trustees, all requirements under the Plan
that there be a direction, designation or other communication between the
Committee and the Trustees shall be disregarded. The members of the Committee
shall serve at the pleasure of and may be removed by the Company. Vacancies in
the Committee arising by resignation, death, removal, or otherwise shall be
filled by the Company. The number of members of the Committee shall be as
designated by the Company from time to time. The
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Trustees shall accept and may rely upon a certification by the Company as to the
number and identity of the individuals comprising the Committee from time to
time.
9.03 Powers of Committee. The Committee shall have all powers and
authority necessary in order to carry out its duties and responsibilities in
connection with the administration of the Plan and Trust as herein provided, and
the Committee may make such rules and regulations as it may deem necessary or
desirable to carry out the provisions of the Plan and Trust. The Committee shall
determine any question arising in the administration, interpretation, and
application of the Plan and Trust, including any question submitted by the
Trustees on a matter necessary for them properly to discharge their duties; and
the decision of the Committee shall be conclusive and binding on all persons.
9.04 Action by Committee. The Committee shall act by a majority of its
members at the time in office and such action may be taken by vote at a meeting
or in writing without a meeting. The Committee may by such majority action
authorize any one or more of its members to execute any direction or document or
take any other action on behalf of the Committee, and in such event any one of
the members of the Committee may certify in writing to the Trustees or any other
person the taking of such action and the name or names of the members of the
Committee so authorized, including himself. The execution of any direction,
document, or certificate on behalf of the Committee by any of its members shall
constitute his certification of his authority with respect thereto, and the
Trustees or other person shall be protected in accepting and relying upon any
such direction, document, or certificate and is released from inquiry into the
authority of any of the members of the Committee. Notwithstanding anything to
the contrary elsewhere herein contained, no member of the
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Committee shall take any action as a member of the Committee with respect to any
matter concerning himself as a Participant of the Plan.
9.05 Discretionary Action. Wherever under the provisions of this
Agreement the Committee is given any discretionary power or powers, such power
or powers shall not be exercised in such manner as to cause any discrimination
in favor of or against any Employee or class of Employees.
9.06 Evidence on Which Committee May Act. In taking any action or
determining any fact or question which may arise under this Plan and Trust, the
Committee may, with respect to the affairs of the Company or its Employees, rely
upon any statement by the Company with respect thereto. In the event that any
dispute may arise regarding the payment of any sums or regarding any act to be
performed by the Committee or the Trustees, the Committee may in its sole
discretion direct that such payment be retained or postpone or direct the
postponement of the performance of such act until actual adjudication of such
dispute shall have been made in a court of competent jurisdiction, or until the
Company, the Committee, and/or the Trustees shall have been indemnified against
loss to the satisfaction of the Committee; provided, however, that in the event
of any such dispute, the Committee may rely upon and act in accordance with any
directions received from the Company.
9.07 Employment of Agents. The Committee may employ agents, including,
but not limited to, custodians, accountants, consultants, or attorneys, to
exercise and perform such of the powers and duties of the Committee hereunder as
the Committee may delegate to them, and otherwise to render such services to the
Committee as the Committee may determine, and the Committee may enter into
agreements setting forth the terms and conditions of such service.
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The Committee may appoint an independent public accountant to audit the Plan.
The compensation of such agents shall be an expense chargeable in accordance
with Section 9.08. The Committee shall be fully protected in delegating any such
power or duty to or in acting upon the advice of any such agent, in whole or in
part, and except as may be required by Federal law, shall not be liable for any
act or omission of any such agent, the Committee's only duty being to use
reasonable care in the selection and retention of any such agent.
9.08 Compensation and Expense of Committee. The members of the
Committee shall serve without compensation for services as such. The Company
may, but is not obligated to, pay all or part of the expenses of the Committee.
To the extent not paid by the Company, the expenses of the Committee shall be
paid by the Trust. To the extent any expenses which are paid out of the Trust
are properly allocable to an Investment Fund or to the separate account of a
Participant, they shall be so allocated and charged. Such expenses shall include
any expenses incident to the functioning of the Trust, including, but not
limited to, attorneys' fees and the compensation of other agents, accounting and
clerical charges, expenses, if any, of being bonded as required by ERISA, and
other costs of administering the Trust.
9.09 Indemnification of Committee Members. The Company shall indemnify
and hold harmless each member of the Committee from and against any and all
claims, losses, damages, expenses (including reasonable attorneys' fees approved
by the Company), and liability (including any reasonable amounts paid in
settlement with the Company's approval), arising from any act or omission of
such member, except when the same is judicially determined to be due to the
willful misconduct of such member.
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ARTICLE X
The Trustees
10.01 Powers of Trustees. It shall be the duty of the Trustees to hold
and, subject to the provisions of this Article, to invest and reinvest the funds
of the Trust and to make distributions therefrom in accordance with the written
directions of the Committee. The Trustees shall have no responsibility for the
correctness under the terms of the Plan of any written directions which they
receive from the Committee. The Trustees shall not be responsible for the
collection of contributions payable to the Trust by the Company pursuant to
Article IV.
10.02 Investments. Except as provided in Sections 7.10 and 10.12, the
Trustees shall invest and reinvest the assets of the Trust and keep the same
invested, without distinction between principal and income, subject to the
following general investment policies:
(a) All amounts attributable to a Participant's accounts shall be
invested pursuant to the Participant's investment elections under Section 5.07
in one or more of the Investment Funds under the Plan.
(b) All interest, dividends, and other income, as well as any cash
proceeds from the sale or disposition of securities or other property, received
with respect to any Investment Funds (unless received in additional shares or
investment units of such Investment Funds) shall be reinvested in the same
Investment Funds which produced such interest, dividends, and other income. If
any distribution with respect to an Investment Funds may be received at the
election of the holder of shares or investment units in such Investment Funds in
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the form of additional shares or investment units or in cash or other property,
the Trustees shall elect to receive it in additional shares or investment units
of the Investment Funds.
(c) The Trustees shall have no responsibility for any investment
elections, directions or instructions exercised by Participants hereunder and
shall incur no liability on account of investing or administering the assets of
the Trust in accordance with such elections, directions, or instructions.
Without limitation of the foregoing, if, at any time, there shall be no
investment election in effect with respect to a Participant, the Trustees shall
invest all amounts contributed in respect of such Participant in such one or
more of the Investment Funds as the Committee shall, in its sole discretion,
select on a uniform basis for all such Participants.
10.03 Method of Holding, Buying, and Selling Securities. The Trustees
may keep any or all securities or other property in the name of some other
person, firm, or corporation or in their own name without disclosing fiduciary
capacity. The Trustees may sell at public auction or by private contract,
redeem, or otherwise realize upon any securities, investments, or other property
forming a part of the Trust fund and for such purposes may execute such
instruments and writings and do such things as they shall deem proper.
10.04 Exercise of Rights.
(a) Except as otherwise provided in paragraph (b) below or in
Section 10.12, the Trustees are hereby authorized to vote upon any stock, bonds,
or other securities of any corporation, association, or trust at any time
comprising the Trust fund or otherwise consent to or request any action on the
part of such corporation, association, or trust, and to give general or special
proxies or powers of attorney, with or without power of substitution,
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and to participate in reorganizations, recapitalizations, consolidations,
mergers, and similar transactions with respect to such securities; to deposit
such stocks and other securities in any voting trust, or with any protective or
like committee, or with a trustee, or with depositaries designated thereby; and
generally to exercise any of the powers of an owner with respect to the stock
and other securities and assets comprising the Trust fund which the Trustees
deem to be for the best interests of the Trust to exercise.
(b) Notwithstanding paragraph (a) above, each Participant shall
have the power to vote, or otherwise act with respect to, the shares in any
Investment Fund which is a mutual fund that is held by the Trustees for the
benefit of such Participant. Such shares shall be voted, or such other action
shall be taken with respect thereto, in accordance with the Participants'
instructions except as may otherwise be required by applicable law. To
facilitate such right, the Trustees shall have delivered to each Participant a
copy of all proxies, notices, and other relevant information which are
distributed to shareholders of such Investment Fund generally and the Trustees
shall establish such procedures for the collection of Participants' instructions
with respect to voting, or taking action with respect to, such shares and the
timely transmission of such instructions as they shall determine to be
appropriate. Any such shares with respect to which voting instructions have been
sought but have not been timely received shall not be voted.
10.05 Reliance on Trustees as Owners. No person dealing with the
Trustees shall be required to take any notice of this Agreement, but all persons
so dealing shall be protected in treating the Trustees as the absolute owners
with full power of disposition of all the monies, securities, and other property
of the Trust, and all persons dealing with the Trustees are
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released from inquiry into the decision or authority of the Trustees and from
seeing to the application of monies, securities, and other property paid or
delivered to the Trustees.
10.06 Liquidation of Assets. In the event that cash is required by the
Trustees to effect any action or distribution under this Trust, or to pay any
expenses of this Trust, or for any other reason deemed sufficient by the
Trustees consistent with any outstanding obligations of the Trust, the Trustees
shall take such action as to the disposition of securities or other property
forming a part of the Trust as will provide the amount of cash necessary for
such payments.
10.07 Direction by Committee. Whenever the Committee consists of
members other than or in addition to the Trustees, and whenever the Trustees are
required or authorized to take any action hereunder pursuant to any written
direction or determination of the Committee, such direction or determination
shall be sufficient protection to the Trustees if contained in a writing signed
by any one or more of its members authorized to execute documents on behalf of
the Committee pursuant to Section 9.04. By such writing the Committee may
ratify, approve, or confirm any action taken by the Trustees, and upon such
ratification, approval, or confirmation the Trustees shall be protected as
though authorization or determination by the Committee had preceded such action.
In the absence of direction by the Committee as to any matter provided in this
Plan, the Trustees may in their discretion take such action as they deem fit and
proper with respect thereto after reasonable attempts to secure Committee
direction. The Trustees may deliver documents to the Committee by delivering the
same to each member of the Committee or by mailing the same, postage prepaid,
addressed to the Committee in care of the Company at its principal office.
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10.08 Records and Accounting. The Trustees shall keep accurate and
detailed records of their transactions hereunder and all their accounts, books,
and records relating thereto shall be open at all reasonable times to the
inspection of the Committee, the Company, and their authorized representatives.
The Trustees shall render in writing, at least once each twelve (12) months,
accounts of their transactions under this Agreement to the Company and each
member of the Committee, and the Committee (or the Company if the Trustees are
the sole members of the Committee) may approve such accounts of the Trustees by
an instrument in writing delivered to the Trustees. In the absence of the filing
in writing with the Trustees by the Committee (or the Company if the Trustees
are the sole members of the Committee) of exceptions or objections to any such
account within ninety (90) days after the receipt by the Committee (or the
Company if the Trustees are the sole members of the Committee) of any such
account, the Committee (or the Company if the Trustees are the sole members of
the Committee) shall be deemed to have approved such account; and in such case,
or upon the written approval of the Committee (or the Company if the Trustees
are the sole members of the Committee) of any such account, the Trustees shall
be released, relieved, and discharged with respect to all matters and things set
forth in such account. Except as may otherwise be required by applicable Federal
law, no person interested in the Trust or otherwise other than the Company or
the Committee may require an accounting or bring any action against the Trustees
with respect to the Trust and its actions as Trustees. In any proceeding
instituted by the Trustees, the Company, and/or the Committee with respect to
these accounts, only the Company, the Committee, and the Trustees shall be the
necessary parties. The Trustees shall
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from time to time make such other reports and furnish such other information
concerning the Trust as the Committee may in writing reasonably request or as
may be required by applicable Federal law.
10.09 Payment of Taxes. The Trustees shall upon direction of the
Company pay out of the Trust fund any and all taxes of any and all kinds,
including without limitation property taxes and income taxes levied or assessed
under existing or future laws upon or in respect of the Trust or any monies,
securities, or other property forming a part thereof or the income therefrom
subject to the terms of any agreements or contracts made with respect to trust
investments which make other provision for such tax payments. The Trustees may
assume that any taxes assessed on or in respect of the Trust or its income are
lawfully assessed unless the Company shall in writing advise the Trustees that
in the opinion of counsel for the Company such taxes are or may be unlawfully
assessed. In the event that the Company shall so advise the Trustees, the
Trustees will, if so requested in writing by the Company, contest the validity
of such taxes in any manner deemed appropriate by the Company or its counsel; or
the Company may itself contest the validity of any such taxes in the name of the
Trustees; and the Trustees agree to execute all documents, instruments, claims,
and petitions necessary or advisable in the opinion of the Company or its
counsel for the refund, abatement, reduction, or elimination of any such taxes.
10.10 Trustees' Compensation and Expenses. The Trustees shall not
receive compensation from the Plan for their services as such, but all
reasonable expenses of the Trustees, including those arising under Section 10.09
hereof may, at the election of the Company, be paid by the Company and unless or
until so paid shall constitute a charge upon
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the Trust. Such expenses shall include any expenses incident to the functioning
of the Plan, including but not limited to attorney's fees and the compensation
of other agents, accounting and clerical charges, the cost of obtaining any
bonds required by ERISA, and other costs of administering the Plan or the Trust.
To the extent that any expenses (including those arising under Section 10.09
hereof) which are paid out of the Trust are properly allocable to an Investment
Fund or to the separate account of a Participant, they shall be so allocated and
charged.
10.11 Resignation or Removal of Trustees. Any Trustee acting hereunder
may resign at any time upon thirty (30) days' written notice to the Company, the
Committee and the remaining Trustees, and the Company may remove any Trustee
upon thirty (30) days' written notice to the Trustees and the Committee; but the
Company and such Trustee may by written instrument waive such notice. If any
Trustee shall resign, be removed, or for any other reason cease to be Trustee,
the Company shall appoint a successor Trustee or Trustees. Subject to the
foregoing provisions, any resignation or removal of the Trustee or appointment
of a new Trustee shall be by instrument in writing and shall become effective on
the date therein specified. Any successor Trustee shall have the same powers and
duties as the succeeded Trustee, subject to such changes as the Company may then
determine. The appointment of any successor Trustee or Trustees hereunder shall
without any separate instrument or conveyance immediately vest title to the
assets of the Trust in such successor Trustee or Trustees. Upon request of such
successor Trustee or Trustees, the Company and the Trustee ceasing to act shall
execute and deliver such instruments of conveyance and further assurance and do
such other things as may reasonably be required for more fully and certainly
vesting and confirming
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in such successor Trustee or Trustees all the right, title, and interest of the
retiring Trustee in and to the Trust funds.
10.12 Appointment of Investment Managers. The Trustees from time to
time may appoint one or more Investment Managers (as that term is defined in
Section 3(38) of ERISA) to manage (including the power to acquire and dispose
of) all or any portion or portions of the Trust. The Trustees may enter into
such agreements setting forth the terms and conditions of any such appointment
as they determine to be appropriate. The Trustees shall retain the right to
remove and discharge any Investment Manager. The compensation of such Investment
Managers shall be an expense payable in accordance with Section 10.10. The
Trustees shall notify the Company of the appointment of any Investment Manager
by delivering to the Company an executed copy of the agreement under which such
Investment Manager was appointed together with a written acknowledgment by such
Investment Manager that it is (a) a fiduciary with respect to the Plan, (b)
bonded as required by ERISA, and (c) is either (i) registered as an investment
advisor under the Investment Advisors Act of 1940, or (ii) a bank as defined in
said Act, or (iii) an insurance company qualified to perform investment
management services under the laws of more than one state of the United States.
The Trustees shall carry out the written instructions of any Investment Manager
with respect to the management and investment of the assets then under the
control of such Investment Manager and shall not incur any liability on account
of their compliance with such instructions. Purchase and sale orders may be
placed by such Investment Manager directly with brokers and dealers without the
intervention of the Trustees and, in such event, the Trustees' sole obligation
shall be to make payment for purchased securities and deliver those that have
been
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sold when advised of the transaction. The Trustees shall not incur any liability
on account of their failure to exercise any of the powers delegated to any
Investment Manager because of the failure of such Investment Manager to give
instructions for the management of the assets under the control of such
Investment Manager. The Trustees shall be under no duty to question any
Investment Manager, nor to review any securities or other property acquired or
retained at the direction of any Investment Manager, nor to make any suggestions
to any Investment Manager in connection therewith.
Each Investment Manager shall have the authority to exercise all of the
powers of the Trustees hereunder with respect to assets under its control
(including the power to vote, to give general or specific proxies or powers of
attorney, or to participate in reorganizations, mergers and similar
transactions, all as more fully described in Section 10.04), but only to the
extent that such powers relate to the investment of such assets. In addition,
each Investment Manager appointed hereunder is hereby authorized to direct the
investment of any part or all of the assets of the Trust under its control in
any one or more trusts, now or hereafter maintained by the Investment Manager or
by a bank or trust company which is an affiliate of the Investment Manager, for
the collective investment of funds held in trust, including but not limited to
trusts for the investment of funds held under employees' pension or profit
sharing plans or trusts which are qualified within the meaning of and exempt
from tax under the revenue laws of the Untied States, and permitted by existing
or future rulings of the United States Treasury Department to pool their
respective funds in a group trust. In the event that trust assets are invested
in any such collective investment trust, then the instrument pursuant to which
such
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collective investment trust is established shall be deemed a part of the Plan
and this Agreement and is specifically incorporated herein.
10.13 Indemnification of Trustees. The Company shall indemnify and hold
harmless each Trustee from and against any and all claims, losses, damages,
expenses (including reasonable attorneys' fees approved by the Company), and
liability (including any reasonable amounts paid in settlement with the
Company's approval), arising from any act or omission of such Trustee, except
when the same is judicially determined to be due to the willful misconduct of
such Trustee.
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ARTICLE XI
The Company
11.01 No Contract of Employment. This Trust shall not be construed as
creating any contract of employment between the Company and any Participant,
Employee, or other person, and nothing herein contained shall give any person
the right to be retained in the employ of the Company or otherwise restrain the
Company's right to deal with its employees, including Participants and
Employees, and their hiring, discharge, layoff, compensation, and all other
conditions of employment in all respects as though this Trust did not exist.
11.02 No Contract to Maintain Plan. The Company by the creation of the
Plan does not enter into any agreement to maintain the Plan or to make any
future contributions thereto or reimbursement of expenses incurred hereunder.
Each contribution by the Company shall be voluntary, and the Company reserves
the right to suspend payment of its contributions hereunder, and no party hereto
or Participant or any other person shall have any cause or right of action
against the Company by reason of any failure by the Company to make
contributions to the Trust, or by reason of any action by the Company in
terminating the Plan and Trust.
11.03 Liability of the Company. Subject to its agreement to indemnify
the members of the Committee and the Trustees, as provided in Sections 9.09 and
10.13, neither the Company nor any person acting in behalf of the Company shall
be liable for any act or omission on the part of any member of the Committee, on
the part of the Trustees, or on the part of any Investment Manager or for any
act performed or the failure to perform any act by any person with respect to
this Agreement, the Plan, or Trust, the Company's only duty being to use
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reasonable care in the selection and retention of the Trustees and the members
of the Committee.
11.04 Action by the Company. Whenever under the terms of this Agreement
the Company is permitted or required to take any action, such action shall be
taken by the Board of Directors, or any duly authorized committee thereof, or by
any officer of the Company thereunto duly authorized, by the Board of Directors
or otherwise. In such event, any such officer may certify to the Committee or
the Trustees or any other person the taking of such action and the name or names
of the officers so authorized, including himself or herself. The execution of
any direction, document, or certificate on behalf of the Company by any of its
officers shall constitute a certification of the authority of such officer with
respect thereto, and the Committee, the Trustees, or other person shall be
protected in accepting and relying upon any such direction, document, or
certificate and are released from inquiry into the authority of any officer of
the Company.
11.05 Successor to Business of the Company. Unless this Plan and Trust
be sooner terminated, a successor to the business of the Company, by whatever
form or manner resulting, may continue the Plan and Trust by executing an
appropriate supplementary agreement and such successor shall ipso facto succeed
to all the rights, powers, and duties of the Company hereunder. The employment
of any Employee who has continued in the employ of such successor shall not be
deemed to have been terminated or severed for any purposes hereunder.
11.06 Dissolution of the Company. If the Company is dissolved by reason
of bankruptcy or insolvency or otherwise, without any provision being made for
the continuation
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of this Plan and Trust by a successor to the business of the Company, the Plan
and Trust hereunder shall terminate, and the Trustees shall proceed in the same
manner as though the Plan and Trust were being terminated by the Company as
provided in Section 8.03.
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ARTICLE XII
Additional Participating Companies
12.01 Participation. Any subsidiary or affiliate of the Company may,
with the consent of the Company, become a participating employer by action of
the board of directors of such subsidiary or affiliate adopting the Plan and
Trust as a Plan and Trust for the benefit of its employees. Any such additional
participating employer is hereinafter referred to in this Article XII as a
"Participating Subsidiary."
12.02 Effective Date. The participation of any Participating Subsidiary
shall take effect as of the date of its action to adopt the Plan and Trust or
such other date as it may specify with the Company's approval.
12.03 Administration. Each Participating Subsidiary shall be deemed the
"Company" and shall have and exercise all the rights, powers, and duties thereof
with respect to the Plan as applied to itself and its employees and that part of
the Trust which represents accounts of Participants employed by it. Subject to
Section 12.04, each Participating Subsidiary hereby authorizes Freedom Capital
Management Corporation to exercise on its behalf all such rights, powers, and
duties, including amendment or termination of the Plan, appointment of the
Trustees and the members of the Committee, and serving as the Plan
Administrator. Each participating employer, including the Company and each
Participating Subsidiary, shall make contributions hereunder on behalf of its
employees in accordance with Article IV.
12.04 Termination. If the Plan shall be terminated by any one
Participating Subsidiary, the Trust shall be valued and the accounts of all
Participants adjusted pursuant to Section 5.06 and assets representing the
accounts of all Participants employed by such
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Participating Subsidiary shall be segregated into a separate trust and held
subject to the provisions of the Plan, and all rights, powers, and duties of the
Company with respect to such separate trust shall be exercised by such
Participating Subsidiary.
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ARTICLE XIII
Top-Heavy Provisions
13.01 General Rule. For any Plan Year for which this Plan is a
"top-heavy plan" as defined in Section 13.03 below, any other provisions of this
Plan to the contrary notwithstanding, this Plan shall be subject to the minimum
contribution provisions set by Section 13.02 and the limitation on contributions
set by Section 13.06.
13.02 Minimum Contribution Provisions. Each Participant who is a
non-key employee (as defined in Section 13.05 below) and who is an Employee as
of the last day of such Plan Year shall be entitled to a minimum contribution
which, when added to the amount of any employer contributions (excluding Basic
and Matching Contributions made with respect to Plan Years commencing on or
after January 1, 1989) allocated to the Participant's accounts under this Plan
and all other defined contribution plans maintained by the Company or any
Affiliated Company, will cause the sum of all such contributions to equal the
lesser of (a) three percent (3%) of such Participant's compensation for such
Plan Year or (b) the percentage at which contributions are made for the key
employee (as defined in Section 13.04 below) for whom such percentage is the
highest for such Plan Year; provided, if such Participant is also a non-key
employee covered under a defined benefit plan maintained by the Company or an
Affiliated Company, such Participant shall be entitled to a minimum benefit
under such defined benefit plan instead of the minimum contribution described in
this Section 13.02. For purposes of this Section 13.02, "compensation" shall be
determined within the meaning of Section 415 of the Code; provided, however,
that in no event shall a Participant's compensation exceed (a) $200,000 for any
Plan Year commencing on or after January 1, 1989 (or such larger amount as
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the Secretary of the Treasury may determine for such Plan Year under Section
401(a)(17) of the Code) and (b) $150,000 for any Plan Year commencing on or
after January 1, 1994 (or such larger amount as the Secretary of the Treasury
may determine for such Plan Year under Section 401(a)(17) of the Code). In
determining the compensation for a Participant for purposes of the dollar
limitation described in the preceding sentence for any Plan Year, the rules of
Section 414(q)(6) of the Code shall apply except that in applying such rules,
the term "family" shall include only the spouse of such Participant and any
lineal descendants of the Participant who have attained age 19 before the close
of such Plan Year.
13.03 Top-Heavy Plan Definition. This Plan shall be a "top-heavy plan"
for any Plan Year if, as of the determination date (as defined in Section
13.03(a) below), the sum of all accounts under the Plan for Participants
(including former Participants but excluding the accounts of Employees who have
not performed any services for the Company at any time during the five (5) year
period ending on the determination date) who are "key employees" (as defined in
Section 13.05 below) exceeds sixty percent (60%) of the sum of all accounts
under the Plan for all Participants (excluding the accounts of former "key
employees" and of Employees who have not performed any services for the Company
at any time during the five (5) year period ending on the determination date)
unless the Plan is part of an aggregation group or if this Plan is part of an
aggregation group (as defined in Section 13.03(b) below) which for such Plan
Year is a "top-heavy group" (as defined in Section 13.03(c) below). Solely for
purposes of this Section 13.03, a Participant's account shall include any
distribution made in the five (5) year period ending on the determination date,
and any contribution due but unpaid as of the determination date.
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(a) "Determination date" means for any Plan Year the last day of
the immediately preceding Plan Year; provided, the determination date" for the
first Plan Year shall be the last day of such first Plan Year. If two or more
plans are being aggregated, they shall be aggregated by adding together the
results for each plan as of the determination dates for such plans that fall
within the same calendar year.
(b) "Aggregation group" means the group of plans, if any, that
includes the group of plans that are required to be aggregated and, if the
Committee so elects, the group of plans that are permitted to be aggregated.
(i) The group of plans that are required to be aggregated
(the "required aggregation group") includes:
(A) each plan (including any terminated plan) of the
Company and of any Affiliated Company in which a "key
employee" is a member, and
(B) each other plan of the Company and any Affiliated
Company which enables a plan in which a key employee is a
member to meet the requirements of either Section 401(a)(4)
or Section 410 of the Code.
(ii) The plans that are permitted to be aggregated (the
"permissive aggregation group") include any plan that is not part of
the "required aggregation group" that the Committee certifies as
constituting a plan within the "permissive aggregation group." Such
plans may be added to the "permissive aggregation group" only if, after
the addition, the "aggregation group" as a whole continues to meet the
requirements of both Section 401(a)(4) and Section 410 of the Code.
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(c) "Top-heavy group" means the "aggregation group," if, as of the
applicable determination date, the sum of the present value of the accrued
benefits for "key employees" under all defined benefit plans included in the
"aggregation group" plus the aggregate of the accounts of "key employees"
(excluding the accounts of Employees who have not performed any services for the
Company at any time during the five (5) year period ending on the determination
date) under all defined contribution plans included in the "aggregation group"
exceeds sixty percent (60%) of the sum of the present value of the accrued
benefits for all employees under all such defined benefit plans plus the
aggregate accounts for all Employees under such defined contribution plans
(excluding the accounts of former "key employees" and of Employees who have not
performed any services for the Company at any time during the five-year period
ending on the determination date). Solely for purposes of this subsection (c),
the accrued benefits of "non-key employees" shall be determined under (i) the
method, if any, that uniformly applies for accrual purposes under all defined
benefit plans maintained by the Company and any Affiliated Company, or (ii) if
there is no such method, as if such benefit accrued not more rapidly than the
slowest accrual rate permitted under Section 411(b)(1)(C) of the Code.
(d) In determining whether this Plan constitutes a "top-heavy
plan," the Committee shall follow the rules set forth in Section 416 of the Code
and regulations pertaining thereto.
13.04 Key Employee. The term "key employee" means any Employee (and any
Beneficiary of an Employee) under this Plan who is a "key employee" as
determined in accordance with Section 416(i)(1) of the Code.
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13.05 Non-Key Employee. The term "non-key employee" means any Employee
(and any Beneficiary of an Employee) who is a "non-key employee" as determined
in accordance with Section 416(i)(2) of the Code.
13.06 Limitation on Contributions. For each Plan Year that the Plan is
a top-heavy plan, 1.0 shall be substituted for 1.25 as the multiplicand of the
dollar limitation in determining the denominator of the defined benefit plan
fraction and of the defined contribution plan fraction for purposes of Section
415(e) of the Code.
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ARTICLE XIV
Miscellaneous
14.01 Spendthrift Provision. It is a condition of the Plan, to which
all rights of each Participant shall be subject, that no right or interest of
any Participant in the Plan or in the Trust shall be assignable or transferable
in whole or in part, either directly or indirectly, by operation of law or
otherwise, including but not by way of limitation, execution, levy, garnishment,
attachment, pledge, bankruptcy, or in any other manner, but excluding devolution
by death or acquisition by a guardian or committee of a mental incompetent, and
no rights or interest of any Participant in the Plan or in the Trust shall be
liable for or subject to any obligation or liability of such Participant except
obligations of a Participant under a qualified domestic relations order within
the meaning of Section 414(p) of the Code or obligations to the Trust pursuant
to Section 7.10.
14.02 Appointment of Person to Receive Payment. If a Participant or
Beneficiary entitled to receive any benefits hereunder is a minor or is deemed
by the Company or is adjudged to be legally incapable of giving valid receipt
and discharge for such benefits, they will be paid to such persons as the
Committee may designate or to the duly appointed guardian. In the event any
amount shall become payable hereunder to any person (or the Beneficiary or
estate of such person), and if after written notice from the Trustees mailed to
such person's last known address as shown on the Committee's records, such
person or personal representative shall not have presented himself to the
Trustees or notified the Trustees in writing of his address within one (1) year
after the mailing of such notice, then the Committee shall in its discretion
appoint one or more of the spouse and blood relatives of such person to receive
such
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amount, including any amount thereafter becoming due to such person (or estate),
in the proportions determined by them. Any action of the Committee hereunder
shall be binding and conclusive upon all persons.
14.03 Construction. In any question of interpretation or other matter
of doubt, the Trustees, the Committee, and the Company may rely upon the opinion
of counsel for the Company or any other attorney at law designated by the
Company with the approval of the Trustees. The provisions of this Agreement
shall be construed, administered, and enforced according to the laws of the
United States and, to the extent permitted by such laws, by the laws of the
Commonwealth of Massachusetts. All contributions to the Trust shall be deemed to
be made in the Commonwealth of Massachusetts.
14.04 Impossibility of Performance. In case it becomes impossible for
the Company, the Committee, or the Trustees to perform any act under this Plan
and Trust, that act shall be performed which in the judgment of the Committee
will most nearly carry out the intent and purpose of this Plan and Trust. All
parties to this Agreement or in any way interested in this Plan and Trust shall
be bound by any acts performed under such condition.
14.05 Definition of Words. Feminine or neuter pronouns shall be
substituted for those of the masculine form, and the plural shall be substituted
for the singular, in any place or places herein where the context may require
such substitution or substitutions.
14.06 Titles. The titles of articles and sections are included only for
convenience and shall not be construed as a part of this Agreement or in any
respect affecting or modifying its provisions.
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14.07 Merger or Consolidation. In the event that this Plan is merged
with or consolidated with any other plan, or the assets or liabilities accrued
under this Plan are transferred to any other plan, each Participant's benefit
under such other plan shall be at least as great immediately after such merger,
consolidation, or transfer (if such plan were then to terminate) as the benefit
to which such Participant would have been entitled under this Plan immediately
before such merger, consolidation, or transfer (if the Plan were then to
terminate).
14.08 Claims Procedure. In accordance with Section 503 of the ERISA and
the regulations of the Secretary of Labor prescribed thereunder,
(a) All claims for benefits under this Plan shall be filed in
writing with the Committee in accordance with such procedures as the Committee
shall reasonably establish;
(b) The Committee shall, within ninety (90) days of submission of
a claim, provide adequate notice in writing to any claimant whose claim for
benefits under the Plan has been denied, setting forth the specific reasons for
such denial and such other information as is required by said regulations
written in a manner calculated to be understood by the claimant;
(c) The Committee shall, upon written request by a claimant within
sixty (60) days of the receipt of the notice that the claim has been denied,
afford a reasonable opportunity to such claimant for a full and fair review by
the Committee of the decision denying the claim; and
(d) The Committee shall, within sixty (60) days of receipt of a
request for a review, render a written decision on its review setting forth the
specific reasons for such decision, written in a manner to be understood by the
claimant.
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14.09 Special Provisions for Certain Leased Employees. A "leased
employee" shall receive credit for Hours of Service for the entire period during
which he is a leased employee of the Company as if he were an Employee of the
Company; provided, however, a leased employee shall not be an Employee eligible
to participate in the Plan as long as he remains a leased employee. For purpose
of this Section 14.09, the term leased employee means any person (a) who is not
an Employee of the Company or an Affiliated Company and (b) who pursuant to an
agreement between the Company or an Affiliated Company and any other person (a
"leasing organization") has performed services for the Company or an Affiliated
Company of a type historically performed by employees in the business field of
the Company or Affiliated Company on a substantially full-time basis for a
period of at least one (1) year. Notwithstanding the foregoing, if leased
employees constitute less than twenty percent (20%) of the Company's or
Affiliated Company's non-highly compensated work force within the meaning of
Section 414(n)(5) of the Code, a person who is covered by a money purchase
pension plan maintained by the leasing organization which provides a
non-integrated employer contribution rate of at least ten percent (10%) of
compensation, immediate participation, and full vesting shall not be considered
a leased employee.
14.10 Effective Date of Amendment and Restatement. The effective date
of this amendment and restatement shall be January 1, 1989, except as otherwise
specifically provided herein, and shall apply only to Employees credited with at
least one (1) Hour of Service on or after said date. Notwithstanding the
foregoing, the effective date of the changes contained in Section 4.02 shall be
January 1, 1989, the effective date of the changes contained in Section 6.02,
Section 6.03, Section 6.04 and Section 6.05 shall be January 1, 1987, the
effective date
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of the changes contained in Section 13.03 shall be January 1, 1985 and the
effective date of Section 7.12 shall be January 1, 1993.
14.11 Execution of Agreement. This Agreement may be executed in any
number of counterparts and each fully executed counterpart shall be deemed an
original.
IN WITNESS WHEREOF the Company, by its duly authorized officer, and the
Trustees have caused these presents to be signed and in the case of the Company,
its corporate seal affixed, this 9th day of November, 1994.
FREEDOM CAPITAL MANAGEMENT
CORPORATION
By /s/ Xxxx Xxxxxxx
---------------------------------
Title Managing Director
TRUSTEES:
/s/ Xxxxxx X. Xxxx
------------------------------------
Xxxxxx X. Xxxx
/s/ Xxxxxx X. Dodge
------------------------------------
Xxxxxx X. Dodge
/s/ Xxxxx X. Xxxxxxxxxx, Xx.
------------------------------------
Xxxxx X. Xxxxxxxxxx, Xx.
00
00
XXXXXXX XXXXXXX MANAGEMENT CORPORATION
DEFERRED SAVINGS PLAN AND TRUST AGREEMENT
First Amendment
A. The FREEDOM CAPITAL MANAGEMENT CORPORATION DEFERRED
SAVINGS PLAN AND TRUST AGREEMENT as amended and restated effective January 1,
1989, is hereby further amended, as follows:
1. Section 2.10 is hereby amended, effective January 1, 1995, to read
as follows: "2.10 'Eligible Employee' means any Employee."
2. Article II is hereby amended, effective January 1, 1995, by adding a
new Section 2.31 at the end thereof to read as follows:
"2.31 'Year of Eligibility Service' for any Employee means (a) the
twelve-month period beginning on the date he becomes an Employee but only
if such Employee is credited with 1,000 or more Hours of Service during
such period; and (b) each Plan Year commencing after the Employee's date
of hire during which such Employee is credited with 1,000 or more Hours of
Service."
3. Section 3.01 is hereby amended, effective January 1, 1995, by adding
a new paragraph at the end thereof to read as follows:
"Effective January 1, 1995, (i) any Eligible Employee who is
employed on a regular full-time basis shall be eligible to become a
Participant on the first day he becomes an Eligible Employee and (ii) any
Eligible Employee who is not employed on a regular full-time basis shall
be eligible to become a Participant on the first January 1 or July 1
coincident with or next following his completion of a Year of Eligibility
Service. For purposes of this Section, an Employee shall be deemed to be
employed on a 'regular full-time basis' if such Employee is expected to
complete at least 1,000 Hours of Service in any period used to determine
completion of a Year of Eligibility Service under Section 2.31."
B. Except as so amended, the Plan in all other respects, is hereby confirmed.
87
IN WITNESS WHEREOF, these presents have been signed and sealed for and on
behalf of the Employer by its duly authorized officer this 18th day of
July, 1995.
FREEDOM CAPITAL MANAGEMENT
CORPORATION
By: /s/ Xxxxxx X. Xxxx
-----------------------
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FREEDOM CAPITAL MANAGEMENT CORPORATION
DEFERRED SAVINGS PLAN AND TRUST
Second Amendment
A. The FREEDOM CAPITAL MANAGEMENT CORPORATION DEFERRED SAVINGS
PLAN as amended and restated effective January 1, 1989, is hereby further
amended effective as of October 16, 1996, as follows:
1 Section 7.10 is hereby amended in its entirety to read as follows:
"7.10 Loans to Participants. Upon written application of a Participant
submitted to the Company at least (30) days (or such shorter period as the
Company allows) prior to a Valuation Date, the Company may direct the Trustees
to lend to such Participant such amount or amounts from his accounts under the
Plan up to fifty percent (50%) of the total aggregate value of the vested
portion of such Participant's accounts (determined as of such Valuation Date,
provided that the aggregate amount of all outstanding loans, including accrued
interest, from the Plan to a Participant shall not exceed $50,000, reduced by
the amount of any loan repayment made during the one (1) year period ending on
the day before the date on which such loan is to be made. The minimum amount
which may be loaned to a Participant under this Section 7.10 shall be $1,000. A
Participant may not have more than three loans outstanding under this Section
7.10 at any given time.
Loans shall be made available to all Participants on a reasonably
equivalent basis, except that the Company may make reasonable distinctions based
upon credit-worthiness, other obligations of the Participant and other factors
that may adversely affect the ability to assure repayment. Loans approved under
this Section 7.10 shall be made as soon as reasonably practicable after the
Valuation Date next following timely receipt by the Company of the Participant's
written application.
Each such loan shall be made at such reasonable rate of interest as the
Company may determine, and shall be subject to such other terms and conditions
as the Company may deem proper, and shall be evidenced by the promissory note of
the Participant and secured by at least fifty percent (50%) of the Participant's
interest in the Plan. Each such loan shall be repaid by such means as may be
authorized by the Company, shall be amortized over the term of the loan in level
payments made not less frequently than quarterly, and shall be repaid within
five (5) years unless such loan is used to acquire a dwelling unit which within
a reasonable period of time is to be used (determined at the time the loan is
made) as the principal residence of the Participant in which case the repayment
period shall not exceed twenty (20) years.
Each such loan shall be deemed to be an investment made at the direction
of such Participant and shall be credited to a separate investment account for
the borrowing Participant. An
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amount equal to the principal amount of such loan when made shall be charged to
the interests of such Participant's accounts as designated by the Participant.
Subject to such restrictions as may be applicable to the particular
Investment Funds, in the event of a loan of less than the entire balance of a
Participant's account, the loan amounts shall be withdrawn from the Investment
Funds pro rata in proportion to the interest of such account in each of such
Investment Funds. All interest and loan repayments shall be reinvested in the
Investment Funds in accordance with the most recent investment election of such
Participant with respect to contributions credited to such accounts. All
expenses incurred by the Company and the Trustees, including reasonable
attorneys' fees and court costs, as a result of a default by a Participant shall
be charged against the Participant's accounts.
If any loan under this Section 7.10 is in default, as determined in
accordance with the procedures established by the Company, when any part or all
of the amount standing to the credit of a Participant's accounts becomes
distributable to such Participant or his Beneficiary, the Company shall direct
the Trustees to apply the amount of such distributable amount in payment of the
entire outstanding loan principal, and any interest theretofore accrued, before
distributing the balance, if any, to the Participant or his Beneficiary."
B. Except as so amended, the Plan in all other respects, is hereby confirmed.
IN WITNESS WHEREOF, these presents have been signed and sealed for and on behalf
of the Employer by its duly authorized officer this 16th day of October 1996.
FREEDOM CAPITAL MANAGEMENT
CORPORATION
By /s/ Xxxx Xxxxxxx
----------------------------
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FREEDOM CAPITAL MANAGEMENT CORPORATION
DEFERRED SAVINGS PLAN AND TRUST
Third Amendment
A. The FREEDOM CAPITAL MANAGEMENT CORPORATION DEFERRED
SAVINGS PLAN AND TRUST (the "Plan") as amended and restated effective January 1,
1989, is hereby further amended in its entirety to read as follows:
1. Section 2.16 is hereby amended to read as follows:
"2.16 "Investment Fund or "Investment Funds" means one or more of the
funds established by the Committee for the investment of Plan assets, as
more fully described in Section 5.07. In addition, the term "Investment
Fund" or "Investment Funds" shall include any investment fund established
by the Trustees at the direction of the Committee which shall be invested
primarily in shares of common stock, $.01 par value per share, of Freedom
Securities Corporation, a Delaware corporation, which stock constitutes
"qualifying employer securities" as defined in section 407(d)(5) of ERISA
and "employer securities" as defined in section 409(l) of the Code
("Freedom Securities Stock"), and short-term interest income vehicles (the
"Freedom Securities Stock Fund"). Consistent with ERISA, the assets of the
Plan may be used to acquire and hold Freedom Securities Stock in any
proportions or amounts."
2. Section 4.02 is hereby amended by adding the following parenthetical
immediately after the term "Matching Contribution" on the second line thereof:
"(in cash or shares of Freedom Securities Stock, in the discretion of the
Company)"
3. Section 5.05 is hereby amended by adding "(a)" at the beginning of
the first paragraph thereto and adding the following subsection (b) to follow
such paragraph:
"(b) Freedom Securities Stock held by the Trust shall be valued
according to the following rules: (1) in the case of Freedom Securities
Stock that is publicly traded on a national securities exchange, such
stock shall be valued by reference to the closing price of such stock on
such exchange on the last trading day immediately preceding the date such
stock is contributed to the Plan or other relevant date for which the
valuation is to be performed and (2) in the case of Freedom Securities
Stock that is not publicly traded on a national securities exchange, such
stock shall be valued as of the date of contribution or other relevant
date by determining the fair market value of such stock through the use of
an independent appraiser."
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4. Section 7.07(a) is hereby amended to read as follows:
"Whenever under this Article VII any amount is required to be distributed
or applied for the benefit of any Participant or Beneficiary or other
person, such distribution shall be made in one lump sum payment (i) in
cash, or (ii) in full shares of Freedom Securities Stock to the extent of
such Participant's accounts interest in the Freedom Securities Stock Fund
plus the cash equal to the value of the remaining balance of such
Participant's accounts."
5. Article X is hereby amended by adding the following Sections 10.14
and 10.15 at the end thereof:
"Section 10.14 Voting of Freedom Securities Stock. Each Participant
or Beneficiary shall have the right and shall be afforded the opportunity
to direct the manner in which the shares of Freedom Securities Stock
representing the interest of such Participant or Beneficiary in the
Freedom Securities Stock Fund shall be voted at all stockholders'
meetings. To facilitate such right the Company shall deliver to each
Participant or Beneficiary a copy of all proxies, notices, and other
information which it distributes to its shareholders generally and the
Committee shall establish such procedures for the collection of
Participants' and Beneficiaries' instructions on the voting of such
Freedom Securities Stock and the timely transmission of such instructions
to the Trustees as it shall determine to be appropriate. Any Freedom
Securities Stock allocable to the interests of Participants and
Beneficiaries in the Freedom Securities Stock Fund for which no signed
voting-direction instrument is timely received from the Participant or
Beneficiary shall not be voted by the Trustees. The Trustees shall take
any and all necessary measures, including, but not limited to, the
retention of an independent outside tabulator, recordkeeper, auditor or
other person, to ensure that the instructions received from Participants
shall be held in strict confidence and shall not be divulged or released
to any person, including employees, officers and directors of the Company
or any Affiliated Company. Participants and Beneficiaries do not acquire
ownership of Freedom Securities Stock held by the Trustees unless and
until the Trustees deliver to them in accordance with Article VII hereof
stock certificates which have been registered in their names on the stock
books of the Company. For purposes of this Section 10.14, to the extent
the Plan does not meet the requirements of Section 404(c) of ERISA, each
Participant and Beneficiary shall be a named fiduciary under the Plan with
respect to his interest in the shares of Freedom Securities Stock held in
the Freedom Securities Stock Fund.
10.15. Tender Offer or Exchange Offer. In the event of a tender offer or
exchange offer by any person (including the Company) for any or all shares
of Freedom Securities Stock held in the Trust, each Participant or
Beneficiary shall have the right and shall be afforded the opportunity to
direct in writing whether the shares of Freedom Securities Stock
(including fractional shares) representing the interest of such
Participant in the Freedom Securities Stock Fund shall be tendered or
exchanged in response to such offer. The Trustees shall act with respect
to such Freedom Securities
92
Stock in accordance with such written instructions. Any such Freedom
Securities Stock with respect to which written instructions have not been
timely received by the Trustees shall not be tendered or exchanged. To
facilitate the foregoing right of the Participants, the Company shall
utilize its best efforts to distribute or cause to be distributed to each
Participant substantially the same information as may be distributed to
the stockholders of the Company in connection with such offer and the
Committee shall establish such procedures for the collection of
Participants' and Beneficiaries' instructions with respect to such Freedom
Securities Stock and the timely transmission of such instructions to the
Trustees as it shall determine to be appropriate. The Trustees shall take
any and all necessary measures, including, but not limited to, the
retention of an independent outside tabulator, recordkeeper, auditor or
other person, to ensure that the instructions received from Participants
and Beneficiaries shall be held in strict confidence and shall not be
divulged or released to any person, including employees, officers and
directors of the Company or any Affiliated Company. For purposes of this
Section 10.15, to the extent the Plan does not meet the requirements of
Section 404(c) of ERISA, each Participant and Beneficiary shall be a named
fiduciary under the Plan with respect to his interest in the shares of
Freedom Securities Stock held in the Freedom Securities Stock Fund."
B. Except as so amended, the Plan in all other respects, is hereby
confirmed.
IN WITNESS WHEREOF, these presents have been signed and sealed for and on
behalf of Freedom Capital Management Corporation by its duly authorized officer
this 27th day of March, 1998.
FREEDOM CAPITAL MANAGEMENT
CORPORATION
By: /s/ Xxxx Xxxxxxx
----------------------
