Exhibit 10 (c), Form 10-K
Kansas City Life
Insurance Company
ELEVENTH AMENDMENT
KANSAS CITY LIFE
EMPLOYEE STOCK PLAN
THIS ELEVENTH AMENDMENT, comprising the restated Kansas City Life Employee Stock
Plan, is effective the 1st day of January, 1998, and is entered into by and
between Kansas City Life Insurance Company, a Corporation organized and existing
under the Laws of the State of Missouri, hereinafter called the "Company", and
Xxxx X. Xxxxxxxx, Xxxxxx X. Xxxxxx and Xxxx X. Xxxxxx, hereinafter referred to
as the "Trustees".
ARTICLE I
Creation and Purpose of Trust
1.1 Name. The Company hereby creates this Plan and Trust to be known as the
"Kansas City Life Employee Tax Credit Stock Owner-ship Plan", also sometimes
referred to as the "Kansas City Life Employee Stock Plan", or the "Kansas City
Life ESOP", hereinafter sometimes referred to as the "Plan" or "Trust".
1.2 Purpose. It is the purpose of this Plan to encourage the contributions of
its employees to the success of the Company and to reward such contributions by
providing the privileges of ownership through stock acquisition, and it shall be
qualified as an employee stock ownership plan and as a payroll tax credit
employee stock ownership plan. It is designed to invest primarily in qualifying
Company stock.
1.3 Exclusive Benefit of Employees. This Agreement has been made, and this Plan
and Trust created, for the exclusive benefit of the Company's full time
employees and their beneficiaries. The terms of this Plan are intended to comply
with the present pro-visions of Sections 401(a), 409A, 501(a) and 4975(d)(3) and
(e)(7) of the Internal Revenue Code, and as they may hereafter be amended, and
Treasury Department Regulations in connection therewith, in order that the Plan
and Trust may qualify for tax exemption. Under no circumstances shall any part
of the principal or income of the Plan and Trust be used for, or revert to, the
Company, or be used for, or diverted to, any purposes other than for the
exclusive benefit of the employees and their beneficiaries. This Plan and Trust
shall not be construed, however, as giving any employee, or any other person,
any right, legal or equitable as against the Company, the Trustees or the
principal or income of the Trust, except as specifically provided for herein,
nor shall it be con-strued as giving any employee the right to remain in the
Company's employment.
ARTICLE II
Eligibility
2.1 Commencing January 1, 1983, each present and future employee shall be
qualified as a participant in this Plan in accordance with the following
provisions:
(a) He shall have attained the age of twenty-one (21) years.
(b) Any employee whose employment commences prior to his attainment of age
twenty-one (21), shall become a participant on the first (1st) day of
the month following his twenty-first (21st) birthday. (c) Any employee
whose employment commences after his attainment of age twenty-one
(21), shall become a par-ticipant on the first (1st) day of the month
following his date of employment.
(d) Any employee of Old American Insurance Company who is age twenty-one
(21) on November 1, 1991 or becomes age twenty-one (21) on or before
December 31, 1991 shall become a participant on January 1, 1992 in
accordance with the terms of the Adoption Agreement dated December 19,
1991. Thereafter, any employee of Old American Insurance Company will
become a participant in accordance with subparagraphs (a), (b) and (c)
of this section.
2.2 With respect to this Plan, an "hour of employment" shall mean:
(a) Each hour for which an employee is directly or indirectly paid, or
entitled to payment, by the Company for the performance of duties.
These hours shall be credited to the employee for the computation
period or periods in which the duties are performed; and
(b) Each hour for which back pay, irrespective of mitigation of damages,
has been either awarded or agreed to by the Company, with no
duplication of credit for hours under Subparagraphs (a), (b) and (c).
These hours shall be credited to the employee for the computation
period or periods to which the award or agreement pertains rather than
the computation period in which the award, agreement or payment is
made. With respect to periods described in Subparagraph (c)
below,crediting of back pay hours shall be subject to the limitations
set forth in that Subpara-graph.
(c) Each hour for which an employee is directly or indirectly paid, or
entitled to payment, by the Company for reasons such as vacation,
holidays, illness, incapacity (includ-ing disability), layoff, jury
duty, military leave or leave of absence in a period during which no
duties are performed (irrespective of whether the employment
relationship was terminated). These hours shall be credited to the
employee for the computation period or periods during which the
nonperformance of such duties occurs. No hour shall be credited based
on any payment under a plan maintained solely to comply with
applicable workers' compensation, unemployment compensation, or
disability insurance laws, or which solely reimburses an employee for
medical or medically-related expenses incurred by the employee. No
more than five hundred one (501) hours shall be credited under this
Subparagraph for any continuous period during which the employee did
not or would not have performed duties. Hours of service for periods
of time during which no duties are performed under Subparagraphs (b)
and (c) shall be calculated and credited according to Department of
Labor Regulations 2530.200b-2 (b) and (c).
(d) In computing an employee's hours of employment on a weekly or monthly
basis, when a record of hours of em-ployment is not available to
determine the hours of employment under Subparagraphs (a), (b) and
(c), the employee shall be assumed to have worked forty-five (45)
hours for each week, or one hundred ninety (190) hours for each month
(as applicable), for which the employee would be required to be
credited with at least one (1) hour of employment under Subparagraphs
(a), (b) or (c) above.
(e) An "hour of employment" shall also include time for which an employee
is absent from work either
(i) by reason of the pregnancy of such employee,
(ii) by reason of the birth of a child of the employee,
(iii)by reason of the placement of a child in connection with the
adoption of the child by the employee, or
(iv) for purposes of caring for the child during the period
immediately following the birth or placement for adoption.
(v) a leave of absence covered under the Family and Medical Leave Act
of 1993.
However, the total number of hours of such service counted for any one
(1) period shall not exceed five hundred one (501) hours.
2.3 Leaves of Absence.
(a) For the purpose of computing continuous employment, leaves of
absence may be included which have been authorized by the Company
for any of the following reasons:
(i) Sickness.
(ii) Disability.
(iii)Service with the armed forces of the United States during
any war or national emergency declared by the President or
the Congress, or undeclared.
(iv) Pregnancy, not to exceed twelve (12) months.
(v) Public service, whether elected or otherwise.
(vi) Obtaining additional education, involving periods of time
not to exceed twelve (12) months for each leave of absence
granted, but only after completion of one (1) full year of
full time employment.
(b) Such leaves of absence may be counted in computing continuous
employment provided the employee returns to active employment on
or before the end of such leave of absence, and, when because of
service in the armed forces as stated above, provided the
employee returns to active employment with the Company within
ninety (90) days following his discharge from such service, or
such longer period during which his re-employment rights are
pro-tected by law.
(c) Any such employee who is not qualified as a participant prior to
the commencement of such a leave of absence shall not be so
qualified until his return to active employment. The provisions
of this Section shall be applied in a like manner to all
employees under similar circumstances.
ARTICLE III
Company Contributions
3.1 Rate of Contribution. Commencing January 1, 1983, in the discretion of the
Executive Committee of the Company, or its designated subcommittee, the Company
will annually contribute to the Plan an amount of common capital stock of the
Company equal to one-half of one percent (.5%) of the aggregate compensation of
participants in the Plan for compensation paid or accrued during calendar years
1983 and 1984, and equal to such other percentage as shall be permissible by
law, currently one-half of one percent (.5%), for compensation paid or accrued
during calendar years 1985 through 1987.
No contribution will be made for a year for which the payroll tax credit is not
available. Notwithstanding the provisions of the preceding sentence, the Company
may, but shall not be required, to make a contribution to the Plan for a Plan
year in which the payroll tax credit is not available. Any contribution made for
a Plan year in which the payroll tax credit is not available shall be accounted
for separately and shall be in accordance with the rules and regulations
pertaining to ESOPs then in effect.
3.2 No Employee Contribution. No contribution shall be required of a
participant, nor will any participant be eligible to make a contribution.
3.3 Investment Credit Recapture. Amounts contributed to the Plan attributable to
all or a portion of the qualified investment credit claimed by the Company shall
remain in the Plan (and, if allocated pursuant to the Plan, shall remain so
allocated) even though part or all of such ESOP credit is recaptured or
redeter-mined.
3.4 Form of Payment. The stock contributions of Kansas City Life Insurance
Company shall be made in treasury stock or in shares of authorized but unissued
stock of Kansas City Life Insurance Company. For purposes of fixing the amount
of contributions made with shares of treasury stock, or shares of authorized but
unissued stock, such stock shall be valued at its bid price on the
over-the-counter market on the valuation day of the month in which the Company's
contribution becomes due, or if the market is closed on that day then on the
last preceding day during which it was open. Effective January 1, 1995, such
stock shall be valued at the average of its bid price on the over-the-counter
market for all business days in the month of the valuation day. In the event the
Company is precluded from delivering such shares to the Trustees by law or
because of the unavailability of such shares, the Company's contribution to the
Trustees shall be in cash, and said cash shall be invested until such time as
shares of the Company stock shall be available for purchase by the Trustees.
ARTICLE IV
Investment of Contributions
4.1 Investment of Funds. Contributions to the Trust shall be invested in
accordance with the authority granted to the Trustees pursuant to the provisions
of this Plan and Trust. It is contem-plated that the contribution made by the
Company from time to time be in shares of the Company stock, or in cash if
necessary to implement the provision of the Plan.
4.2 Voting of Shares. The Trustees shall vote the shares of stock of the Company
for the respective accounts of the partici-pants only in accordance with the
direction of such participants, which directions may be certified to the
Trustees by the Committee, or any agent designated thereby, provided such
directions are received by the Trustees at least five (5) days before the date
set for the meeting at which such shares are to be voted. Shares with respect to
which no such direction shall be received and the fractional shares shall be
voted by the Trustees in the same pro-portions as are shares as to which voting
instructions have been received.
ARTICLE V
Allocation to and Evaluation of Participants Accounts
5.1 Allocation and Evaluation. The value of all Trust assets shall be determined
on the basis of market values as of the last market business day of each
calendar quarter. Effective January 1, 1995, the value of the Kansas City Life
stock shall be determined on the basis of the average of its bid price on the
over-the-counter market for all business days in the last month of each calendar
quarter.
All stock transferred to or purchased by the Trust with respect to a Plan year
shall be allocated among the accounts of persons who were participants on the
last day of the Plan year and who completed at least one thousand (1,000) hours
of employment during such Plan year. The allocation to each participant shall be
an amount which bears the same proportion to the amount of such securities
allocated to all participants in the Plan for that Plan year as the amount of
each participant's compensation during the entire year bears to total
compensation paid to all participants during the entire year. (Compensation in
excess of one hundred thousand dollars ($100,000.00) per year with respect to
any participant will be disregarded for this purpose.)
5.2 Dividends. Except for amounts needed to cover cash distributions in place of
distributions of fractional shares,divi-dends on shares shall be reinvested in
shares of common stock of the Company. Such shares and uninvested dividends
shall be allo-cated quarterly among participants' accounts in proportion to the
value of each participant's account as of the end of the quarter.
5.3 Stock Fund. The Trustees shall maintain a "Stock Fund" which shall cover the
aggregate shares of capital stock contributed to and purchased by the Plan and
any uninvested cash. The Stock Fund shall be valued as of each valuation date,
which shall be the last business day of each quarter or such other dates as the
Committee may establish, on the basis of the then current fair market value of
the assets held therein, as determined by the Trustees. Effective January 1,
1995, the value of the Kansas City Life stock shall be determined on the basis
of the average of its bid price on the over-the-counter market for all the
business days in the last month of the calendar quarter or in the month of such
other date as the Committee may establish. The Administrative Committee shall
maintain records reflecting the account of each participant in the Stock Fund.
5.4 Annual Account. The Administrative Committee shall furnish to each
participant at least once each year a statement of shares and uninvested cash in
the Stock Fund allocated to the participant's account as of a specified date.
ARTICLE VI
Allocation of Fiduciary Responsibility
6.1 Fiduciaries. The fiduciaries shall have only those specific powers, duties,
responsibilities and obligations as are specifically given them under this Plan.
The Company shall have the sole responsibility for making the contributions
required by the Plan, shall have the sole authority to appoint and remove the
Trustees, members of the Administrative Committee, and to amend or terminate, in
whole or in part, this Plan and Trust.
6.2 Administration. The Administrative Committee shall have the sole
responsibility for the administration of this Plan, which responsibility is
specifically described in ARTICLE IX herein.
6.3 Trustees. The Trustees shall have such responsibility for the administration
and management of the assets held pursuant to this Plan and Trust, as is
specifically provided for in the Plan.
6.4 Duties. Each fiduciary warrants that any direction given, information
furnished or action taken by it shall be in accordance with the provisions of
the Plan and Trust, authorizing or providing for such direction, information or
action. Further-more, each fiduciary may rely upon any such direction,
information or action of another fiduciary as being proper under this Plan, and
is not required herein to inquire into the propriety of any such direction,
information or action. It is intended under this Plan that each fiduciary shall
be responsible for the proper exercise of its own powers, duties,
responsibilities and obligations pursuant to the Plan and shall not be
responsible for any act or failure to act of another fiduciary. No fiduciary
guarantees the Trust fund in any manner against investment loss or depreciation
in asset value.
ARTICLE VII
Vesting
7.1 Vesting of Company Contributions. Each participant shall be one hundred per
cent (100%) vested and shall have a nonfor-feitable right to the full value of
his or her account and to any stock and uninvested cash allocated thereto.
ARTICLE VIII
Distributions
8.1 Seven (7) Year Retention. No stock or uninvested cash allocated to a
participant's account may be distributed from that account before the end of
eighty-four (84) months beginning after the month in which the stock and
uninvested cash is allocated to the account, except in the case of separation
from employment for death or any other reason, or except in the case of a
participant who has become disabled and is receiving benefits from the Kansas
City Life or Sunset Life Disability Plans. Notwithstanding the foregoing,
commencing January 1, 1988, if an employee shall continue in the Company's
employment after his or her sixty-fifth (65th) birthday, and commencing January
1, 1998, after his or her sixtieth (60th) birthday (normal retirement date),
such employee shall commence to receive distributions as defined in the Internal
Revenue Code on the earlier of his termination of employment with the Company or
April 1st of the year following the calendar year in which he or she attains the
age of seventy and one-half (70 1/2). Effective January 1, 1989, the minimum
distribution and the minimum distribution incidental benefit requirements of
Internal Revenue Proposed Regulations 1.401(a)(9)-1 and 1.401(a)(9)-2 are hereby
incorporated by reference. Effective January 1, 1997, for par-ticipants other
than a five percent (5%) owner of the Company, distributions shall commence no
later than April 1st of the calendar year following the later of:
(a) The year in which the participant attains age seventy and one-half (70
1/2), or
(b) The year in which the participant retires.
8.2 Separation from Employment. In the case of separation from employment,
whether by death or for any other reason, or in the event a disabled participant
so elects, the account of the participant in the Stock Fund shall be determined
as of the end of the quarter in which such event occurs and shall be distributed
to the participant or beneficiary (in case of death) as soon there-after as
practicable. If separation from service, or if the disabled participant's
election occurs on or after the last day of a Plan year, but prior to the date
on which the Company makes its contribution for the Plan year just ended, and if
the participant is entitled to share in such contribution, then such
participant's share shall be determined as of the end of the quarter in which
the Company's contribution is made and shall be distributed thereafter as soon
as practicable.
8.3 Pre-retirement Distribution. Any participant who remains in the employ of
the Company may request a distribution of stock allocated to his or her account
as of the end of any quarter next following the expiration of eighty-four (84)
months following the month in which the stock was allocated to the account, but
not more often than once within any twelve (12) month period. Requests for
distribution must be in writing, filed with the Administrative Committee at
least fifteen (15) days prior to the end of any such quarter. Distribution shall
be made to such participant as soon as practicable following the end of the
quarter in which the request is made. However, distributions pursuant to this
Paragraph may not be made to an individual who is an alternate payee under a
Quali-fied Domestic Relations Order and for whom an account is being separately
maintained.
8.4 Right to Stock. Any participant who shall be entitled to a distribution from
the Plan shall have the right to demand that his benefits be distributed in the
form of capital stock of the Company. Notwithstanding the foregoing, any
fractional share will be converted to cash, at the valuation date as of which
the distribution is made based on the fair market value at that time as
determined by the Trustees.
8.5 Method of Distribution. All distributions provided pur- suant to this Plan
shall be by a lump sum payment.
8.6 Commencement of Distributions. All distributions shall be made or commenced
to be made as soon as practicable after the valuation date coincident with or
next following the occurrence of one of the distribution events described in
this ARTICLE VIII. Upon written notice to the Committee no later than the end of
the calendar month following the month in which termination occurs, a
participant (or, in the case of death, his beneficiary) entitled to a lump sum
payment may make an irrevocable election to receive the value of his
distribution on January 31st of the next succeeding calendar year.
Alternatively, the participant may choose not to withdraw his benefits when one
of the distribution events occurs,and later elect to have the distribution made
upon written notice before a subsequent valuation date. However, only a full and
complete distribution of his benefits will be allowed whether the participant
withdraws his benefits at the time a distribution event occurs or at some later
date. No partial withdrawals shall be permitted.
8.7 Valuation. The value of a participant's account upon termination shall be
the value on the most recent valuation date preceding January of the year
elected pursuant to Paragraph 8.6. If such election is not so made, such value
shall be determined on the valuation date coincident with or next following the
date the par-ticipant (or, in case of death, his beneficiary) elects within the
election period specified in Paragraph 8.6 above, to receive his distribution,
or the receipt by the Trustees of notice of said participant's termination,
whichever shall occur later.
8.8 Facility of Payment. If the Committee shall receive evidence satisfactory to
it that a participant or beneficiary is physically or mentally incompetent to
receive any payment which shall be due hereunder and to give a valid release
therefor and that another person or an institution is then maintaining or has
custody of such participant or beneficiary, and that no guardian, committee or
other representative of the estate of such participant or beneficiary, shall
have been duly appointed, the Committee may, at its option, make payments
otherwise payable to such participant or beneficiary, to such other person or
institution, and the release of such other person or institution shall be a
valid and complete discharge for such payments.
8.9 Beneficial Designation. Any participant shall have the right to designate a
new beneficiary at any time by filing with the Committee a written request for
such change, but any such change shall become effective only upon receipt of
such request by the Committee. If the payment is made as a result of the death
of the participant, the payment shall be made to the surviving spouse of the
participant, if any, unless the participant and the spouse have requested a
distribution to any other beneficiary. Any such request shall be written and on
forms prescribed by the Adminis-trative Committee. Upon receipt by the Committee
of such request, the change shall relate back to and take effect as of the date
such participant signs such request whether or not such participant is living at
the time the Committee receives such request.
If there be no designated beneficiary living at the death of such participant
when any payment hereunder shall be payable to the beneficiary, then such
payment shall be made as follows: To such participant's wife or husband, if
living; if not living, to such participant's then living lineal descendants, in
equal shares, per stirpes; if none survives, to such participant's surviving
parents, equally; if neither survives, to such participant's executors or
administrators.
8.10 Diversification of Investments.
(i) Each qualified participant in the plan may elect within (90) ninety
days after the close of each calendar year in the qualified election
period to direct the Trustees as to the investment of at least
twenty-five percent (25%) of his or her account in the plan (to the
extent such portion exceeds the amount to which a prior election under
this paragraph applies). In the case of the election year in which the
participant can make his or her last election, the preceeding sentence
shall be applied by substituting "fifty percent (50%)" for
"twenty-five percent (25%)".
(ii) If a participant makes an election, the Trustees may either (a)
distribute the portion of the participant's account covered by the
election to him or her within ninety (90) days after the period during
which the election may be made, or (b) offer at least three
invest-ment options (not inconsistent with regulations prescribed by
the Secretary of the Treasury) to each participant making an election.
(iii)For purposes of this paragraph, the term "qualified participant"
means any employee who has completed at least ten (10) years of
participation under the plan and has attained age fifty-five (55).
(iv) For purposes of this paragraph, the term "qualified election period"
means the five-plan-year period beginning with the plan year after the
plan year in which the participant attains age fifty-five (55) (or, if
later, beginning with the plan year after the first plan year in which
the individual first became a qualified participant).
ARTICLE IX
Administrative Committee
9.1 Membership. The Administrative Committee, sometimes herein referred to as
the "Committee", shall consist of a number of persons, not less than three (3)
nor more than five (5), designated by the Executive Committee of the Company,
who shall serve terms of one (1) year or until their successors are designated,
and said Committee shall have the responsibility for the general administra-tion
of the Plan and for carrying out the provisions of the Plan in accordance with
its terms. The Committee shall have absolute discretion in carrying out its
responsibilities.
9.2 Subcommittees. The Committee may appoint from its members such committees
with such powers as it shall determine; may authorize one (1) or more of its
number or any agent to execute or deliver any instrument or make any payment on
its behalf; and may utilize counsel, employ agents and provide for such clerical
and accounting services as it may require in carrying out the pro-visions of the
Plan.
9.3 Meetings. The Committee shall hold meetings upon such notice, at such place
or places, and at such time or times as it may from time to time determine.
9.4 Majority Action. The action of a majority of the members expressed from time
to time by a vote in a meeting or in writing without a meeting shall constitute
the action of the Committee and shall have the same effect for all purposes as
if assented to by all members of the Committee at the time in office.
9.5 No Compensation. No member of the Committee shall receive any compensation
for his services as such, and, except as required by law, no bond or other
security shall be required of him in such capacity in any jurisdiction.
9.6 Committee Rules. Subject to the limitations of this Plan and Trust, the
Committee from time to time shall establish rules or regulations for the
administration of the Plan and the transaction of its business. The Committee
shall have full and complete discretionary authority to construe and interpret
the Plan and decide any and all matters rising hereunder, except such matters
which the Executive Committee of the Company from time to time may reserve for
itself, including the right to remedy possible ambiguities, inconsistencies or
omissions. All interpretations, determinations and decisions of the Committee or
the Executive Committee of the Company in respect of any matter hereunder shall
be final, conclusive and binding on all parties affected thereby. The Committee
shall, when requested, submit a report to the Executive Committee of the Company
giving a brief account of the operation of the Plan and the performance of the
various accounts established pursuant to the Plan.
9.7 Claims Procedure. The Administrative Committee shall have full and complete
discretionary authority to make all determinations as to the right of any person
to a benefit. Any denial by the Committee of a claim for benefits under this
Plan by a participant or a beneficiary shall be stated in writing by the
Committee and delivered or mailed to the participant or the beneficiary,
whichever is appropriate; and such notice shall set forth the specific reason
for the denial, written to the best of the Committee's ability in a manner that
may be understood without legal or actuarial counsel. In addition, the Committee
shall provide a reasonable opportunity to any participant or beneficiary whose
claim for benefits has been denied for a review of the decision denying the
claim.
9.8 Resignation of Member. Any member of the Committee may resign by giving
notice to the Executive Committee at least fifteen (15) days before the
effective date of his resignation. Any Com- mittee member shall resign upon
request of the Executive Committee. The Executive Committee shall fill all
vacancies on the Committee as soon as is reasonably possible after a resignation
takes place, and until a new appointment takes place, the remaining members of
the Committee shall have authority to act, if approved by either a majority of
the remaining members or by two (2) members, whichever number is lesser.
ARTICLE X
Amendment and Termination
10.1 Amendment. Kansas City Life Insurance Company reserves the right at any
time and from time to time, and retroactively if deemed necessary or appropriate
to conform with governmental regu- lations or other policies, to modify or
amend, in whole or in part, any or all of the provisions of this Plan and Trust
by adoption of a written resolution by the Board of Directors of Kansas City
Life Insurance Company or the Executive Committee of the Board of Directors;
provided that no such modification or amendment shall make it possible for any
part of the contributions of the Company, or any other funds of the Trust, to be
used for, or diverted to, purposes other than for the exclusive benefit of
participants or their beneficiaries.
10.2 Termination. This Plan and Trust is purely voluntary on the part of the
Company, and Kansas City Life Insurance Company reserves the right to terminate
the Plan and the Trust provided herein by adoption of a written resolution by
the Board of Directors of Kansas City Life Insurance Company or the Executive
Committee of the Board of Directors. Upon termination of, or upon the complete
discontinuance of contributions within the meaning of Section 411(d)(3)(B) of
the Internal Revenue Code, participants' accounts shall become fully vested and
nonforfeitable and distribution shall be made as promptly as possible in
accordance with the directions of the Committee.
10.3 Merger. This Plan and Trust shall not be merged or consolidated with, nor
shall any assets or liabilities be transferred to any other Plan or Trust,
unless the accrued benefit of each participant, if the Plan and Trust were
terminated immediately after such action, would be equal to or greater than the
accrued benefit to which such participant would have been entitled if this Plan
and Trust had been terminated immediately before such action.
ARTICLE XI
The Trust
11.1 Number of Trustees. There shall be three (3) Trustees for this Trust with
the Trustees hereinbefore named being the original Trustees.
11.2 Trustees shall Receive Sums Paid. The Trustees shall accept and receive all
sums of money paid to them from time to time by the Company, and shall hold,
invest, reinvest, manage and administer such monies and the increment, increase,
earnings and income thereof as a Trust for the exclusive benefit of the
employees participating in the Plan, and their beneficiaries. All income and
earnings of the Trust shall be accumulated by the Trustees and by them held,
invested and reinvested as a part of the principal of the said Trust.
11.3 Investment of Funds.
(a) Except as hereinafter provided with respect to the cash reserve, the
Trustees shall invest and reinvest the principal and income of the
Trust in the capital stock of the Company. Income from investments and
proceeds of the sale of securities shall be reinvested in the same
manner as contributions received for investment. Any funds held by the
Trustees pending investment in the capital stock of the Company may be
invested temporarily in short-term corporate or governmental debt
securities, or in such other investments as the Trustees shall, after
investi-gation, believe to be sound and suitable investments for this
Trust, although the same may not be of the character permitted for
Trustee's investments by the Laws of the State of Missouri, all
subject to the approval of the Executive Committee, or its designated
subcommittee, as hereinafter provided.
(b) The Trustees may retain in cash so much of the Trust assets as they
may deem advisable.
(c) The Trustees may sell property held by the Trust at either public or
private sale, for cash or on credit, at such times as they may deem
appropriate; they may ex-change such property, and they may grant
options for the purchase or exchange thereof.
(d) The Trustees may consent to and participate in any plan of
reorganization, consolidation, merger, extension or other similar plan
affecting property held by the Trust; they may consent to any
contract, lease, mortgage, pur-chase, sale or other action by any
corporation pursuant to any such plan; they may accept and retain
property issued under any such plan, even though it would not be
eligible as a new investment under the provisions of this Section.
(e) The Trustees may deposit property held in the Trust with any
protective, reorganization or similar committee, and may delegate
discretionary power thereto to pay its reasonable share of such
committee's expenses and com-pensation and any assessments levied with
respect to any property so deposited.
(f) The Trustees may exercise all conversion and subscription rights
pertaining to property held in the Trust.
(g) The Trustees may exercise all voting rights with respect to property
held in the Trust, and in connection there-with grant proxies
discretionary or otherwise, all in accordance with the provisions of
this Plan and Trust.
(h) The Trustees may cause securities and other property to be registered
and held in their names, the name of any one (1) of them, or in the
name of their nominee.
(i) The Trustees may borrow money from others, including the Company, for
the purposes of the Trust, and issue their promissory note or notes
for the same, and pledge or mortgage securities or other assets owned
by the Trust as security for the payment thereof. Any such loan shall
be subject to approval as required of investments herein, and also to
the provisions of Paragraph 11.4 herein.
(j) The Trustees may compromise, compound and settle any debt or
obligation due to or from them as Trustee; they may reduce the rate of
interest on any obligation due them as Trustee; they may extend the
time of payment of both interest and principal, or otherwise modify
the terms of any obligation due them as Trustee; upon default of any
obligation due them as Trustee, they may foreclose or otherwise
enforce any obligation belonging to the Trust.
(k) The Trustees may generally do all such acts, execute all such
instruments, take all such proceedings and exercise all such rights
and privileges with relation to property belonging to the Trust as if
the Trustees were the absolute owners thereof. 11.4 Loan Provisions.
The following provisions shall apply to any loan made to the Trust
fund:
(a) The loan must be at a reasonable rate of interest, for a specific
period of time, and shall not be payable on demand;
(b) Any collateral pledged to the creditor by the Trust shall consist
only of the assets purchased with the borrowed funds (although in
addition to such collateral, the Company may guarantee repayment
of the loan);
(c) Under the terms of the loan, the creditor shall have no recourse
against the Trust except with respect to such collateral;
(d) The loan shall be repaid only from those amounts con-tributed by
the Company to the Trust and from amounts earned on Trust
investments;
(e) The Company must contribute to the Trust amounts suf-ficient to
enable the Trust to pay each installment of principal and
interest on the loan on or before the date such installment is
due, even if no tax benefit results from such contribution; and
(f) Upon the repayment of any portion of the balance due on the loan,
the assets originally pledged as collateral for such portion
shall be released from encumbrance. Released shares shall be
allocated to the accounts of participants during the fiscal year
such portion is paid off. Such allocation shall be made in the
same manner provided under the Plan for allocating shares when no
loan is involved.
(g) Any such loans shall be effected primarily in the interest of
participants and their beneficiaries.
(h) Notwithstanding the foregoing, in the event an exempt loan is
effected it shall be subject to the following additional
provisions and the proceeds thereof must be used within a
reasonable time after their receipt only for any or all of the
following purposes:
(i) To acquire qualifying Company securities.
(ii) To repay such loan.
(iii)To repay a prior exempt loan. A new loan, the proceeds of
which are so used, must satisfy the provisions of this
Subparagraph (h).
(i) Except as provided hereinafter or as otherwise required
by applicable law, no security acquired with the
proceeds of an exempt loan may be subject to a put,
call or other option, or buy-sell or similar
arrangement while held by and distributed from the
Plan, whether or not the Plan is then an ESOP.
(j) A qualifying Company security acquired with the proceeds of an
exempt loan by the Plan, must be subject to a put option if it is
not publicly traded when distributed or if it is subject to a
trading limitation when distrib-uted. For purposes of this
Subparagraph, a "trading limitation" on a security is a
restriction under any federal or state securities law, any
regulation there-under or an agreement, not prohibited herein,
affecting the security which would make the security not as
freely tradable as one not subject to such restriction. The put
option must be exercisable only by a participant, by the
participant's donees or by a person (including an estate or its
distributee) to whom the security passes by reason of a
participant's death. (Under this Subparagraph (j), "participant"
means a participant and beneficiaries of the participant under
the ESOP.) The put option must permit a participant to put the
security to the Company. Under no circumstances may the put
option bind the Plan. However, it may grant the Plan an option to
assume the rights and obligations of the Company at the time that
the put option is exercised. If it is known at the time a loan is
made that federal or state law will be violated by the Company's
honoring such put option, the put option must permit the security
to be put, in a manner con-sistent with such law, to a third
party (e.g., an affiliate of the Company or a shareholder other
than the Plan) that has substantial net worth at the time the
loan is made and whose net worth is reasonably expected to remain
substantial.
(k) General rule:
(i) A put option must last for a period of at least sixty (60)
days following the date of distribution to the participant.
If the put option is not exercised during that period, it
must be available to the participant for a period of at
least sixty (60) days in the following Plan year as provided
in regulations prescribed by the Internal Revenue Service.
(l) Other put option provisions:
(i) Manner of exercise. A put option is exercised by the holder
notifying the Company in writing that the put option is
being exercised.
(ii) Time excluded from duration of put option. The period during
which a put option is exercisable does not include any time
when a distributee is unable to exercise it because the
party bound by the put option is prohibited from honoring it
by applicable federal or state law.
(iii)Price. The price at which a put option must be exercisable
is the value of the security, at its bid price on the
over-the-counter market on the day in which such put option
may and shall be exercised.
(iv) Payment terms. The provisions for payment under a put option
must be reasonable. The deferral of payment is reasonable if
adequate security and a reasonable interest rate are
provided for any credit extended and if the cumulative
payments at any time are no less than the aggregate of
reasonable periodic payments as of such time. Periodic
payments are reasonable if annual installments, be-ginning
with thirty (30) days after the date the put option is
exercised, are substantially equal. Generally, the payment
period may not end more than five (5) years after the date
the put option is exercised. However, it may be extended to
a date no later than the earlier of ten (10) years from the
date the put option is exercised or the date the proceeds of
the loan used by the Plan to acquire the security subject to
the put option are entirely repaid.
(v) Payments restrictions. Payment under a put option may be
restricted by the terms of a loan. Otherwise, payment under
a put option must not be restricted by the provisions of a
loan or any other arrangement, including the terms of the
Company's Articles of Incorpo-ration, unless so required by
applicable state law.
(m) The provisions of Subparagraphs (j), (k) and (l) hereinabove are
nonterminable. If the Plan holds or has distributed securities
acquired with the proceeds of an exempt loan and either the loan is
repaid or the Plan ceases to be an ESOP, these protections and rights
shall continue to exist. However, the protections and rights will not
fail to be nonterminable merely because they are not exercisable under
Subparagraphs (k) and (l).
(n) All assets acquired by the Plan with the proceeds of an exempt loan
referred to hereinabove must be added to and maintained in a suspense
account. Such assets are to be withdrawn from the suspense account
only in accordance with rules and regulations of the Internal Revenue
Ser-vice and as if all securities in the suspense account were
encumbered. Assets in such suspense account are assets of this ESOP
Plan.
11.5 Approval of Investments. Before obtaining any loan or making any new
investment or reinvestment of any funds of this Trust, the Trustees shall submit
to the Executive Committee of the Company, or its designated subcommittee, a
proposal of the terms of any such loan, or a list of any such securities in
which it pro-poses to invest such funds and the amount proposed to be invested
in each security, the Trustees shall proceed to act on such loan, to purchase,
or refrain from purchasing, such securities in accordance with the acceptance or
rejection, in whole or in part, of such proposals by the Executive Committee of
the Company, or its designated subcommittee. Acceptance or rejection of such
pro-posals, or any modification thereof, or any of them by the said Committee,
shall be signified in writing and delivered to the Trustees within thirty (30)
days of the submission of such proposals by the Trustees, provided however, that
if no written modification, acceptance or rejection of such proposals, or any of
them, shall be so delivered by the said Committee within the time herein limited
therefor, the Trustees shall be warranted and protected in assuming that all of
the proposed loans or investments which have not been specifically modified or
rejected as aforesaid, meet with the complete approval of said Executive
Committee, or its designated subcommittee.
11.6 Cash Reserve. The Trustees may maintain a cash reserve in such amount as to
provide for current distribution of benefits under the Plan. Such cash reserve
may consist of uninvested con-tributions of the Company, or of the proceeds of
the sale of investments of the Trust. All of the funds held in such cash reserve
as well as all funds and securities and assets belonging to the Trust shall be
safely kept by the Trustees on deposit or in the vaults of a bank or trust
company selected and designated by the Board of Directors or the Executive
Committee of the Company.
11.7 Disbursement of Funds. Disbursement of the assets of this Trust shall be
made by the Trustees only to or for the benefit of the participants in the Plan
or their beneficiaries, and only at the time, in the amount and in the manner
prescribed in written instructions of the Administrative Committee delivered by
such Committee to the Trustees.
11.8 Instructions to Trustees. The Trustees shall not be obligated or required
to determine whether any instructions issued to them by the Administrative
Committee are in fact so issued in accordance with the terms of the Plan or the
powers and duties thereunder of said Committee.
11.9 Fiduciary Insurance. The Trustees or the Administrative Committee shall
have the right to purchase insurance on behalf of themselves or anyone acting in
a fiduciary capacity with respect to the Plan and Trust, to cover liability or
losses occurring by reason of the act or omission of a fiduciary, if such
insurance permits recourse by the insurer against the fiduciary in the case of a
breach of a fiduciary obligation by such fiduciary.
11.10 Accounting by Trustees. Each year the Trustees shall render to the Company
an account of their administration of the Trust for the year ending on the
preceding 31st of December. The written approval of said account by the Board of
Directors or the Executive Committee of the Company shall, as to all matters and
transactions stated therein or shown thereby, be final and binding upon all
persons who are then or who may thereafter become interested in this Plan and
Trust.
11.11 Compensation. No Trustee shall receive any compensa-tion for his services
as such Trustee. In the administration of said Trust, the Trustees, if they deem
it advisable, may employ an executive director, secretary or treasurer and fix
reasonable compensation therefor, and a Trustee may act as such executive
director, secretary or treasurer and receive the compensation so fixed. The
Trustees may in their discretion employ clerical help, actuaries, accountants,
attorneys or other necessary personal services of a person or corporation as may
be necessary to properly administer, defend and protect the Trust, and
reasonable compensa-tion for said services may be paid by the Trustees from the
Trust in the event the Company does not elect to pay for such services. Any
taxes that may be levied against said Trust shall be paid by the Trustees from
the Trust assets after liability for said taxes, if any, has been established,
and in determining the liability for taxes the Trustees are specifically
authorized to use their own discretion in contesting taxes claimed to be due
against said Trust, and said Trustees may employ counsel for such purposes and
pay said counsel fees from the Trust assets in the event the Company does not
elect to pay said costs and fees.
11.12 Trustees and Vacancies. The Trustees administering this Trust shall at all
times be Officers of the Company, and any Trustee may at any time be removed
from the office of Trustee, with or without cause, by the Board of Directors or
the Executive Com-mittee of the Company. The Trustees named herein shall serve
as such Trustees until their resignation, death or removal by the Board of
Directors or the Executive Committee of the Company. When any Trustee ceases to
be an Officer of the Company, he automati-cally ceases to be a Trustee.
Resignation of a Trustee shall be by written notice given to the Board of
Directors or the Executive Committee of the Company. Whenever a vacancy occurs
by resigna-tion, death or removal of one (1) or more of the Trustees, the Board
of Directors or the Executive Committee shall promptly fill said vacancy or
vacancies so created by naming a successor Trustee or successor Trustees
possessing the qualifications herein prescribed. All successor Trustees shall
have the same powers in connection with said Trust as the initial Trustees have,
and they shall be subject to the same limitations and directions as prescribed
herein for the initial Trustees.
11.13 Rules. The Trustees may make proper rules for carrying out the purposes of
the Trust, and may amend said rules from time to time. A majority of the
Trustees shall constitute a quorum, and the action taken by a quorum shall be
controlling and shall be deemed the act of the Trustees. The Trustees may
designate any one (1) of their number to act as chairman or presiding officer.
Any one (1) of the Trustees shall be and is hereby authorized to affix his
signature as the signature of all the Trustees when such may be desirable in the
performance of their duties pursuant hereto. This Plan and Trust shall be
construed and enforced according to the Laws of the State of Missouri, and all
provisions thereof shall be administered according to the laws of such state.
Any suit at law or in equity brought against the Trustees or the Company by any
person, firm or corporation, including the participants in the Plan, must be
first instituted in Xxxxxxx County, Missouri, which County and State is the
situs of the parties hereto and the only jurisdiction within which this Plan and
Trust is to be administered or located.
ARTICLE XII
Allocations Limitations
12.1 Maximum Limitation. Commencing January 1, 1983, in no event shall the sum
of the annual additions to a participant's account for any Plan year exceed the
lesser of:
(a) (i) Thirty thousand dollars ($30,000.00) or such higher amount as may
be prescribed by regulations issued pur-suant to Section 415(d) of the
Internal Revenue Code to reflect increases in the cost of living; plus
(ii) the lesser of thirty thousand dollars ($30,000.00) (as adjusted
for cost of living increases) or the amount of Company stock
contributed to the Plan; [Effective January 1, 1989, Subparagraph (ii)
is deleted] or
(b) Twenty-five percent (25%) of such participant's compen-sation for the
Plan year. No more than one-third (1/3) of the Company contributions
for a year shall be allocated to the group of "highly compensated
employees" defined as follows:
Priorto January 1, 1997, an employee who, during the year or the preceding
year:
(1) Was at any time a five percent (5%) owner of the company,
(2) Received compensation from the company in excess of seventy-five
thousand dollars ($75,000.00),
(3) Received compensation from the company in excess of fifty
thousand dollars ($50,000.00) and was in the top-paid group of
employees for such year, or
(4) Was at any time an officer and received compensation greater than
fifty percent (50%) of the amount in effect under Section
415(b)(1)(A) of the Internal Revenue Code for such year.
Beginning January 1, 1997, an employee who:
(5) Was a five percent (5%) owner of the Company at any time during
the year or preceding year, or
(6) For the preceding year
A. had compensation [as defined in Code Section 415(c)(3)] from
the Company in excess of $80,000.00 and
B. if the Company elects the application of this clause for the
preceding year, was in the group consisting of the top
twenty percent (20%) of the employees ranked on the basis of
compensation paid during the preceding year. Annual
additions to a participant's account for a Plan year shall
be the sum for any year of the Company's contributions plus
the amount of any employee contributions plus the
forfeitures.
12.2 Reallocation. If, but for the limitations set forth in Paragraph 12.1, the
annual additions to a participant's account for any Plan year would exceed the
limitation set forth in that Para-graph, such annual additions shall be reduced
to the extent necessary to comply with the requirements of Paragraph 12.1. Any
portion of the Company's contribution which must be reallocated as a result of
the requirements of Paragraph 12.1 shall be reallocated among the accounts of
the remaining active participants in the same manner as the initial allocation
was made.
12.3 Annual Additions Reduction. If any participant is a participant under any
other Defined Contribution Plan maintained by the Company, the total of the
annual additions to such partici-pant's account from all such Defined
Contribution Plans shall not exceed the limitations set forth in Paragraph 12.1.
If it is determined that as a result of the limitation set forth in the
preceding sentence, the annual additions to the participant's account in this
Plan must be reduced, such reduction shall be accomplished in accordance with
the provisions of Paragraph 12.2.
12.4 Annual Additions Reduction. If any participant is a participant under a
Defined Benefit Plan maintained by the Company, the sum of the Defined Benefit
Plan fraction for a Plan year and the Defined Contribution Plan fraction for
that year shall be no greater than one (1.00). If it is determined that the
limitation set forth in the preceding sentence has been exceeded, the numerator
of the defined benefit plan fraction shall be adjusted by freezing or adjusting
the rate of benefit authorized by the defined benefit plan so that the sum of
both fractions shall not exceed one (1) for the respective participant.
Effective January 1, 2000, this paragraph shall not apply. 12.5 Retirement Plan.
As used in this Section, the words "retirement plan" shall mean:
(a) Any profit sharing, pension or stock bonus plan described in Section
401(a) and 501(a) of the Internal Revenue Code;
(b) Any annuity plan or annuity contract described in Section 403(a) or
403(b) of the Internal Revenue Code;
(c) Any qualified bond purchase plan described in Section 405(a) of the
Internal Revenue Code; and
(d) Any individual retirement account, individual retirement annuity or
retirement bond described in Section 408(a), 408(b) or 409 of the
Internal Revenue Code.
12.6 Defined Contribution Plan. As used in this Section, the words "Defined
Contribution Plan" shall mean a retirement plan which provides for an individual
account for each participant and for benefits based solely on the amount
contributed to the par-ticipant's account and any income, expenses, gains and
losses, and any forfeitures of accounts of other participants which may be
allocated to such participant's accounts.
12.7 Defined Benefit Plan. As used in this Section, the words "Defined Benefit
Plan" shall mean any retirement plan which is not a Defined Contribution Plan.
12.8 Defined Benefit Plan Fraction. As used in this Section, the words "Defined
Benefit Plan fraction" shall mean, for any Plan year, a fraction,
(a) the numerator of which is the projected annual benefit of the
participant, that is, the annual benefit to which he would be entitled
under the terms of the Defined Benefit Plan on the assumptions that he
continues employment until his normal retirement date as determined
under the terms of the Defined Benefit Plan, that his compensation
continues at the same rate as in effect in the Plan year under
consideration until his normal retirement date and that all other
relevant factors used to determine bene-fits under such Defined
Benefit Plan remain constant as of the current Plan year for all
future Plan years, under all Defined Benefit Plans maintained by the
Company determined as of the close of the Plan year, and
(b) the denominator of which is the lesser of: (i) the maximum dollar
limit for such year (for example, ninety thousand dollars ($90,000.00)
for 1983 and adjusted annually for increases in the cost of living as
permitted under Section 415(d) of the Internal Revenue Code) times
1.25, or (ii) the percentage of compensation limit for such year times
1.4.
12.9 Defined Contribution Plan Fraction. As used in this Section, the words
"Defined Contribution Plan fraction" shall mean, for any Plan year, a fraction,
(a) the numerator of which is the sum of the annual additions to the
participant's account under all Defined Contri-bution Plans maintained
by the Company in that Plan year, and
(b) the denominator of which is the sum of the lesser of the following
amounts, determined for the year and for each prior year of service
with the Company: (i) the product of 1.25 multiplied by the dollar
limitation in effect for the year, or (ii) the product of 1.4
multiplied by the percentage of compensation limit (IRC 415 (e)(3)
as amended).
(c) In computing the defined contribution plan fraction above, for years
ending after December 31, 1982, at the election of the Company, the
amount to be taken into account for all years ending before January 1,
1983, may be computed to be an amount equal to the denominator of the
fraction, as in effect for the year ending in 1982, multiplied by a
transition fraction,
1. the numerator of which is the lesser of (i) fifty-one thousand
eight hundred seventy-five dollars ($51,875.00), or (ii) 1.4
multiplied by twenty-five per cent (25%) of the participant's
compensation for the year ending in 1981, and
2. the denominator of which is the lesser of (i) forty-one thousand
five hundred dollars ($41,500.00), or (ii) twenty-five per cent
(25%) of the participant's compensation for the year ending in
1981.
ARTICLE XIII
General Provisions
13.1 Expenses. The Company shall pay all expenses incurred in administering the
Plan and managing the Trust assets. The Company shall not pay any brokerage
fees, commissions, stock transfer taxes and other charges and expenses in
connection with the purchase and sale of securities under the Plan, unless
specifically approved by the Executive Committee, or its designated
subcommittee.
13.2 Source of Payment. Benefits pursuant to the Plan shall be payable only out
of the assets of the Trust. No person shall have any right under the Plan with
respect to the assets of the Trust, or against any Trustee, insurance company or
the Company, except as specifically provided for herein.
13.3 Inalienability of Benefits. The interest hereunder of any participant or
beneficiary except as may be required by a Qualified Domestic Relations Order
defined in Section 414(p) of the Internal Revenue Code, or as otherwise provided
in Section 401(a)(13) of the Internal Revenue Code, shall not be alienable,
either by assignment or by any other method, and to the maximum extent
permissible by law, shall not be subject to being taken, by any process
whatever, by the creditors of such participant or beneficiary.
13.4 No Right to Employment. Nothing herein contained nor any action taken under
the provisions hereof shall be construed as giving any employee the right to be
retained in the employment of the Company.
13.5 Accrued Benefit. The term "accrued benefit" shall mean the value of a
participant's account or accounts with respect to all funds in this Plan.
13.6 Uniform Administration. Whenever in the administration of the Plan any
action is required by the Committee, such action shall be uniform in nature as
applied to all persons similarly situated and no such action shall be taken
which will discriminate in favor of shareholders of the Company, highly
compensated par-ticipants or participants whose principal duties consist of
supervising the work of others.
13.7 Beneficiary. The word "beneficiary" shall be deemed to include the estate
of the participant, dependents of the partici-pant, persons who are the natural
objects of the participant's bounty, and any person designated by the
participant to share in the benefits of the Plan and Trust after the death of
the participant. Wherever the rights of participants are stated or limited
herein, their beneficiaries shall be bound thereby.
13.8 Severability. In the event that any provision of this Plan and Trust shall
be held invalid or illegal for any reason, such determination shall not affect
the remaining provisions of this Plan, but this Plan shall be construed and
enforced as if such invalid or illegal provision had never been included in the
Plan. This Plan shall be construed in accordance with the Laws of the State of
Missouri.
13.9 Articles. Titles of Articles are for general information only and this Plan
shall not be construed by reference to such titles.
13.10 Gender. Words used in the masculine gender shall be read and construed to
include the feminine gender.
13.11 Plural. Wherever required, the singular of any word in this Plan and Trust
shall include the plural and the plural may be read in the singular.
13.12 Disability. The term "disability" as used in this Plan means a physical or
mental condition of a participant which results in the receipt of benefits by
such participant pursuant to the provisions of either the Kansas City Life
Disability Plan or the Sunset Life Disability Plan.
13.13 Compensation. For the purposes herein, the term "com-pensation" shall
include all compensation, as defined in Regulation 1.415-2(d)(11)(i) of the
Internal Revenue Code, due and payable to an employee by the Company, including
any amount not includable in the gross income of an employee under Internal
Revenue Code Sections 125, 402(e)(3), 402(h) and 403(b).
13.14 Initial Qualifications. The Company reserves the right to have all its
contributions returned to it free of this Trust, and to terminate said Plan and
Trust, if the Trust does not initially meet the qualification requirements of
the Internal Revenue Code for an employee stock option plan.
13.15 Company. The term "Company" means Kansas City Life Insurance Company, a
Missouri Corporation, Sunset Life Insurance Company of America, a Washington
Corporation, and Old American Insurance Company, a Missouri Corporation, and any
other subsidiary corporation of Kansas City Life Insurance Company required to
be treated as a single employer under Internal Revenue Code Section 414(b), (c),
(m) and (o), any or all of which may sometimes be referred to herein as
affiliated corporations.
13.16 Employee. The term "employee" shall mean any person employed by Kansas
City Life Insurance Company or any subsidiary corporation under the rules of
common law, and shall not include agents, general agents, consultants or other
independent con-tractors, or, effective January 1, 1989, leased employees as
defined in Section 414(n) and (o) of the Internal Revenue Code. Effective
January 1, 1997, "leased employee" shall mean any person other than an employee
of the Company who has performed services for the Company under an agreement
between the Company and a leasing organization on a substantially full time
basis for at least one (1) year, provided such services are performed under the
primary direction or control by the Company.
Leased employees shall not participate in this Plan. Further-more, a person
who is not designated as an "employee" in the Company's employment records
during a particular period of time, including a person designated as an
"independent contractor", is not to be considered to be an employee during that
period of time. Such a person shall not be considered to be an employee even if
a determination is made by the Internal Revenue Service, the Depart-ment of
Labor, or any other government agency, court, or other tribunal, that such
person is an employee for any purpose, unless and until the Company in fact
designates such person as an employee for purposes of this Plan. If such a
designation is made, the designation shall be applied prospectively only unless
the Company specifically provides otherwise.
13.17 Company Stock. The term "Company stock" shall mean shares of the
common capital stock of Kansas City Life Insurance Company.
13.18 Executive Committee. Wherever in the Plan and Trust the term
"Executive Committee" is used, it shall be taken to mean only the Executive
Committee of the Board of Directors of Kansas City Life Insurance Company.
13.19 Board of Directors. Wherever in the Plan and Trust the term "Board of
Directors" is used, it shall be taken to mean only the Board of Directors of
Kansas City Life Insurance Company.
13.20 Affiliated Company Participation. Notwithstanding any- thing in this
Agreement to the contrary, no employee of any subsidiary or affiliated
corporation of Kansas City Life Insurance Company shall have the right to
participate in this Plan unless such Plan shall have been adopted by the
corporation for which such employee is employed.
13.21 Direct Rollovers. The provisions of this Paragraph shall be effective
January 1, 1993 and apply to distributions after January 1, 1993.
Notwithstanding any provision of this Plan to the contrary, a distributee may
elect to have any portion of an eligible rollover distribution paid directly to
an eligible retire-ment plan specified by the distributee in a direct rollover.
The Administrative Committee may prescribe the time and manner in which this
election is made.
As used in this Paragraph, "eligible rollover distribution", "eligible
retirement plan", "distributee" and "direct rollover" shall mean:
(a) "Eligible rollover distribution" is any distribution of all or any
portion of the balance to the credit of the distributee. However, an
eligible rollover distribution shall not include:
(i) 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 expec-tancies) of the distributee and the
distributee's designated beneficiary, or for a specified period
of ten (10) years or more;
(ii) Any distribution required under Code Section 401(a)(9); or
(iii)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.
(b) "Eligible retirement plan" is:
(i) An individual retirement account (described in Code Section
408(a)) or individual retirement annuity (described in Code
Section 408(b)); or
(ii) An annuity plan (described in Code Section 403(a)); or
(iii)A qualified trust (described in Code Section 401(a)) that
accepts the distributee's eligible rollover distribution.
However, in the case of an eligible rollover distribution to a
surviving spouse, eligible retirement plan shall mean only the
items in (i) above.
(c) "Distributee" shall include an employee or former em-ployee. An
employee's or former employee's surviving spouse and the employee's or
former employee's spouse or former spouse who is an alternate payee
under a Qualified Domestic Relations Order (defined in Code Section
414(p)) are distributees with regard to the interest of the spouse or
former spouse.
(d) "Direct rollover" is a payment by the Plan to the eligible retirement
plan specified by the distributee. The Plan shall withhold twenty
percent (20%) of an eligible rollover distribution which is not paid
to an eligible retirement plan.
13.22Participants who Enter Armed Forces. Effective December 12, 1994,
notwithstanding any provision of this Plan to the contrary, contributions,
benefits and service credit with respect to qualified military service will be
provided in accord-ance with Code Section 414(v).
13.23 Contribution Under Mistake of Fact. If a contribution is made by the
Company by a mistake of fact, such contribution may be returned to the Company
within one (1) year after the payment of the contribution. Any contribution
returned to the Company shall not include any investment earnings thereon, but
shall be net of any investment losses thereon.
13.24 Contributions Conditioned on Deductibility. Company contributions are
expressly conditioned upon deductibility of contributions under Section 404 of
the Internal Revenue Code. If any part or all of a contribution is disallowed as
a deduction under Section 404, then to the extent a contribution is disallowed
as a deduction, it may be returned to the Company within one (1) year after the
later of the date of payment of the contribution or the date the deduction for
the contribution was disallowed. Any contributions returned shall not include
any investment earnings thereon, but shall be net of any investment losses
thereon.
ARTICLE XIV
Top Heavy Provisions
14.1 Compensation Limits. With respect to compensation as defined in this Plan,
for any Top Heavy Plan year, compensation in excess of two hundred thousand
dollars ($200,000.00), or such otheramount as the Secretary of the Treasury may
designate, shall be disregarded. Effective January 1, 1994, one hundred fifty
thousand dollars ($150,000.00) is the maximum compensation. This amount will be
adjusted in accordance with Internal Revenue Code Section 401(a)(17)(B).
14.2 Key Employee. "Key employee" means any employee or former employee (and his
beneficiaries) who, at any time during the Plan year or any of the preceding
four (4) Plan years, is:
(a) An officer of the Company, as that term is defined within the meaning
of the regulations under Internal Revenue Code Section 416. For the
years 1984 through 1987, an officer is not treated as a key employee
if the officer has an annual compensation of forty-five thousand
dollars ($45,000.00) or less.
(b) One of the ten (10) employees owning (or considered as owning within
the meaning of Code Section 318) the largest interests in all
employers required to be aggregated under Code Sections 414(b), (c),
and (m). However, an employee will not be considered a top ten (10)
owner for a Plan year if the employee earns less than thirty thousand
dollars ($30,000.00), or such other amount adjusted in accordance with
Code Section 415(c)(1)(A) as in effect for the calendar year in which
the determination date falls.
(c) A five percent (5%) owner of the Company. "Five percent (5%) owner"
means any person who owns (or is considered as owning within the
meaning of Code Section 318) more than five percent (5%) of the
outstanding stock of the Company or stock possessing more than five
percent (5%) of the total combined voting power of all stock of the
Company.
(d) A one percent (1%) owner of the Company having an annual compensation
from the Company of more than one hundred fifty thousand dollars
($150,000.00). "One percent (1%) owner" means any person who owns (or
is considered as owning within the meaning of Code Section 318) more
than one percent (1%) of the outstanding stock of the Company or stock
possessing more than one percent (1%) of the total combined voting
power of all stock of the Company. In determining percentage ownership
hereunder, employers that would otherwise be aggregated under Code
Sections 414(b), (c), and (m) shall be treated as separate em-ployers.
However, in determining whether an individual has compensation of more
than one hundred fifty thousand dollars ($150,000.00) compensation
from each employer required to be aggregated under Code Sections
414(b), (c), and (m) shall be taken into account.
14.3 Non-Key Employee. "Non-key employee" means any employee who is not a key
employee.
14.4 Super Top Heavy Plan. "Super Top Heavy Plan" means, for Plan years
commencing after December 31, 1983, that, as of the determination date, (1) the
present value of accrued benefits of key employees, or (2) the sum of the
aggregate accounts of key employees under this Plan and any Plan of the
Company's aggregation group, exceeds ninety percent (90%) of the present value
of accrued benefits or the aggregate accounts of all participants under this
Plan and any Plan of the Company's aggregation group.
14.5 Top Heavy Plan. "Top Heavy Plan" means, for Plan years commencing after
December 31, 1983, that, as of the determination date, (1) the present value of
accrued benefits of key employees, or (2) the sum of the aggregate accounts of
key employees under this Plan and any Plan of the Company's aggregation group,
exceeds sixty percent (60%) of the present value of accrued benefits or the
aggregate accounts of all participants under this Plan and any Plan of the
Company's aggregation group.
14.6 Top Heavy Plan Year. "Top Heavy Plan Year" means any calendar year after
December 31, 1983 in which the Plan is a top heavy plan.
14.7 Top Heavy Plan Requirements.
(a) For any "Top Heavy Plan Year", the following provisions shall apply
notwithstanding any other provision in this Plan to the contrary:
1. Any person who is a participant in this Plan in any year in which
it shall be a "Top Heavy Plan" shall have his or her benefits
vested in accordance with the following schedules: Twenty Percent
(20%) after two (2) years of service; Forty percent (40%) after
three (3) years of service; Sixty percent (60%) after four (4)
years of service; Eighty per-cent (80%) after five (5) years of
service; One hundred percent (100%) after six (6) years of
service.
Effective January 1, 1989, there shall be no decrease in a
participant's nonforfeitable percentage in the event the Plan's
status as top heavy changes for any year. Further, if the vesting
schedule shifts in and out of the above schedule for any year
because the Plan's top heavy status changes, such shift shall be
considered an amendment of the vesting schedule. If this occurs,
each participant with at least three (3) years of service with
the Company may elect to have his nonforfeitable percentage
determined without regard to the shift. The election period will
begin with the date the deemed amendment is made and shall end on
the later of:
A. Sixty (60) days after the deemed amendment is adopted;
B. Sixty (60) days after the deemed amendment is effective; or
C. Sixty (60) days after the participant is issued written
notice of the deemed amendment by the Administrative
Committee.
2. Notwithstanding anything in this Plan to the contrary for any Top
Heavy Plan Year, the Company shall make a minimum contribution
for each non-key employee equal to three percent (3%) of such
non-key employee's salary.
3. For any year in which this Plan is top heavy, each non-key
employee will receive a minimum contribu-tion if the non-key
employee has not separated from service at the end of the top
heavy year, regard-less of whether the non-key employee has less
than one thousand (1,000) hours of service in such year.
Furthermore, such non-key employee shall receive such minimum
contribution regardless of his or her level of compensation, and
regardless of whether he or she declines to make a mandatory
personal con-tribution.
4. Notwithstanding the foregoing, so long as any non-key employee is
covered by both the Company's Pension Plan and this Plan, the
minimum contribu-tion required herein shall be satisfied by the
accrual of the defined benefit by the respective non-key employee
for any top heavy year.
5. If the Company shall be maintaining both this Plan and a defined
benefit plan in any top heavy year, a factor of 1.0 must be
applied to the dollar limits when the top heavy ratio exceeds
ninety percent (90%).
14.8 Determination of Top Heavy Status.
(a) This Plan shall be a Top Heavy Plan for any Plan year commencing after
December 31, 1983, in which, as of the determination date, (1) the
present value of accrued benefits of key employees, or (2) the sum of
the aggregate accounts of key employees under this Plan and any Plan
of an aggregation group exceeds sixty percent (60%) of the present
value of accrued benefits or the aggregate accounts of all
participants under this Plan and any Plan of an aggregation group.
If any participant is a non-key employee for any Plan year, but such
participant was a key employee for any prior Plan year, such
participant's present value of accrued benefit and/or aggregate
account balance shall not be taken into account for purposes of
determining whether this Plan is a Top Heavy Plan (or whether any
aggregation group which includes this Plan is a Top Heavy group).
(b) This Plan shall be a Super Top Heavy Plan for any Plan year commencing
after December 31, 1983, in which, as of the determination date, (1)
the present value of accrued benefits of key employees, or (2) the sum
of the aggregate accounts of key employees under this Plan and any
Plan of an aggregation group, exceeds ninety percent (90%) of the
present value of accrued benefits or the aggregate accounts of all
participants under this Plan and any Plan of an aggregation group.
(c) Aggregate account. A participant's aggregate account as of the
determination date is the sum of:
1. His participant's account balance as of the most recent valuation
occurring within a twelve (12) month period ending on the
determination date.
2. Contributions that would be allocated as of a date not later than
the determination date, even though those amounts are not yet
made or required to be made.
3. Any Plan distributions made within the Plan year that includes
the determination date or within the four (4) preceding Plan
years. However, in the case of distributions made after the
valuation date and prior to the determination date, such
distri-butions are not included as distributions for Top Heavy
purposes to the extent that such distribu-tions are already
included in the participant's aggregate account balance as of the
valuation date. Notwithstanding anything herein to the contrary,
all distributions, including distributions made prior to January
1, 1984, will be counted.
4. Any employee contributions, whether voluntary or mandatory.
However, amounts attributable to tax deductible qualified
employee contributions shall not be considered to be a part of
the participant's aggregate account balance.
(d) "Aggregation group" means either a required aggregation group or a
permissive aggregation group as hereinafter determined.
1. Required aggregation group. In determining a re-quired
aggregation group hereunder, each Plan of the Company in which a
key employee is a parti-cipant, and each other Plan of the
Company which enables any Plan in which a key employee
participates to meet the requirements of Code Sections 401(a)(4)
and 410, will be required to be aggregated. Such group shall be
known as a required aggregation group. In the case of a required
aggregation group, each Plan in the group will be considered a
Top Heavy Plan if the required aggregation group is a Top Heavy
group. No Plan in the required aggregation group will be
considered a Top Heavy Plan if the required aggregation group is
not a Top Heavy group.
2. Permissive aggregation group. The Company may also include any
other Plan not required to be included in the required
aggregation group, provided the resulting group, taken as whole,
would continue to satisfy the provisions of Internal Revenue Code
Sections 401(a) or 410. Such group shall be known as a permissive
aggregation group.
In the case of a permissive aggregation group, only a Plan that is
part of the required aggregation group will be considered a Top
Heavy Plan if the permissive aggregation group is a Top Heavy
group. No Plan in the permissive aggregation group will be
considered a Top Heavy Plan if the permissive aggregation group
is not a Top Heavy Plan group.
3. Only those Plans of the Company in which the determination dates
fall within the same calendar year shall be aggregated in order
to determine whether such Plans are Top Heavy Plans.
(e) "Determination date" means (1) the last day of the preceding Plan
year, or (2) in the case of the first Plan year, the last day of such
Plan year.
(f) Present value of accrued benefit. In the case of a defined benefit
plan, a participant's present value of accrued benefit shall be as
determined under the provisions of the applicable defined benefit
plan.
(g) "Top Heavy group" means an aggregation group in which, as of the
determination date, the sum of:
1. The present value of accrued benefits of key employees under all
defined benefit plans included in the group; and
2. The aggregate accounts of key employees under all defined
contribution plans included in the group, exceeds sixty percent
(60%) of a similar sum determined for all participants.
(h) "Top Heavy Plan year" means that, for a particular Plan year
commencing after December 31, 1983, the Plan is a Top Heavy Plan.
(i) Notwithstanding anything herein to the contrary, the effective
date otherwise provided for herein for the application of Code
Section 416 to this Plan (Plan years beginning after December 31,
1983) shall be extended in accordance with any legislative act of
Congress.
IN WITNESS WHEREOF, the Company has caused this Eleventh Amendment to be
executed by its authorized Officers and its Corporate Seal to be hereunto
affixed, and the Trustees have executed this Trust, all on the day of , 19 .
KANSAS CITY LIFE INSURANCE COMPANY
By:
Its: Vice President
ATTEST:
By:
Its: Assistant Secretary
TRUSTEES
