View:
As filed with the Securities and Exchange Commission on February
6, 1995
Registration No. 33-______
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
KIRBY CORPORATION
(Exact name of registrant as specified in its charter)
Nevada 74-1884980
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1775 St. James Place, Suite 300
Houston, Texas 77056
(Address of principal executive offices) (Zip Code)
KIRBY 401(K) PLAN
(Full title of the plan)
George A. Peterkin, Jr. Copy to:
President Henry Gilchrist, Esq.
Kirby Corporation Jenkens & Gilchrist,
1775 St. James Place, Suite 300 A Professional
Corporation
Houston, Texas 77056 1445 Ross Avenue, Suite 3200
(713) 629-9370 Dallas, Texas 75202
(Name, address and telephone number
including area code of agent for service)
CALCULATION OF REGISTRATION FEE
Title of Class Amount To Proposed Proposed Amount
of Securities Be Maximum Maximum of
to be Registered Registered Offering Aggregate Registration
(1) Price Offering Fee (3)
per Price
Share (2)(3)
(2)(3)
Common Stock, 300,000 $15.875 $4,762,500 $1,643
$0.10 Shares
par value
per share
(1) Pursuant to Rule 416(c) under the Securities Act of
1933, as amended, this Registration Statement also covers an
indeterminate amount of interests to be offered or sold pursuant
to the Kirby 401(k) Plan (the "Plan").
(2) Estimated solely for the purpose of calculating the
registration fee.
(3) Calculated pursuant to Rule 457(c) and (h).
Accordingly, the price per share of the common stock offered
hereunder pursuant to the Plan is based on 300,000 shares of
common stock that may be offered or sold under the Plan at a
price per share of $15.875, which is the average of the highest
and lowest selling price per share of common stock on the
American Stock Exchange, Inc. on January 31, 1995.
PART II
INFORMATION REQUIRED IN REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The registrant and the Plan hereby incorporate by reference
in this registration statement the following documents previously
filed by the registrant with the Securities and Exchange
Commission (the "Commission"):
(1) the registrant's Annual Report on Form 10-K filed
with the Commission for the fiscal year ended December 31,
1993;
(2) the registrant's Quarterly Reports on Form 10-Q
for the quarters ended March 31, June 30 and September 30,
1994, filed with the Commission;
(3) the registrant's Report on Form 8-K, filed with
the Commission on December 9, 1994; and
(4) the description of the common stock, par value
$0.10 per share, of the registrant (the "Common Stock") set
forth in the Registration Statement on Form 8-B, dated
October 14, 1976, including any amendment or report filed
for the purpose of updating such description.
All documents filed by the registrant with the Commission
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), subsequent
to the date of this registration statement shall be deemed to be
incorporated herein by reference and to be a part hereof from the
date of the filing of such documents until such time as there
shall have been filed a post-effective amendment that indicates
that all securities offered hereby have been sold or that
deregisters all securities remaining unsold at the time of such
amendment.
Item 6. Indemnification of Directors and Officers.
(a) The Restated Articles of Incorporation of the
registrant provide for indemnification as follows:
"TWELFTH: 1. The corporation shall indemnify any person who
was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative,
except an action by or in the right of the corporation, by
reason of the fact that he is or was a director, officer,
employee or agent of the corporation, or is or was serving
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at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses,
including attorneys' fees, judgments, fines and amounts paid
in settlement actually and reasonably incurred by him in
connection with the action, suit or proceeding if he acted
in good faith and in a manner which he reasonably believed
to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or
proceeding, has no reasonable cause to believe his conduct
was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction, or
upon a plea of nolo contendere or its equivalent, does not,
of itself, create a presumption that the person did not act
in good faith and in a manner which he reasonably believed
to be in or not opposed to the best interests of the
corporation, and that, with respect to any criminal action
or proceeding, he had reasonable cause to believe that his
conduct was unlawful.
2. The corporation shall indemnify any person who was
or is a party or is threatened to be made a party to any
threatened, pending or completed action or suit by or in the
right of the corporation to procure a judgment in its favor
by reason of the fact that he is or was a director, officer,
employee or agent of the corporation, or is or was serving
at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against expenses,
including amounts paid in settlement and attorneys' fees
actually and reasonably incurred by him in connection with
the defense or settlement of the action or suit if he acted
in good faith and in a manner which he reasonably believed
to be in or not opposed to the best interests of the
corporation. Indemnification shall not be made for any
claim, issue or matter as to which such a person has been
adjudged by a court of competent jurisdiction, after
exhaustion of all appeals therefrom, to be liable to the
corporation or for amounts paid in settlement to the
corporation unless and only to the extent that the court in
which the action or suit was brought or other court of
competent jurisdiction determines upon application that in
view of all the circumstances of the case, the person is
fairly and reasonably entitled to indemnity for such
expenses as the court deems proper.
3. To the extent that a director, officer, employee
or agent of a corporation has been successful on the merits
or otherwise in defense of any action, suit or proceeding
referred to in sections 1 and 2 of this Article Twelfth, or
in defense of any claim, issue or matter therein, he must be
indemnified by the corporation against expenses, including
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attorneys' fees, actually and reasonably incurred by him in
connection with the defense.
4. Any indemnification under sections 1 and 2 of this
Article Twelfth, unless ordered by a court or advanced
pursuant to section 5 of this Article Twelfth, must be made
by the corporation only as authorized in the specific case
upon a determination that indemnification of the director,
officer, employee or agent is proper in the circumstances.
The determination must be made:
(a) By the stockholders;
(b) By the board of directors by majority vote of
a quorum consisting of directors who were not parties
to the act, suit or proceeding;
(c) If a majority vote of a quorum consisting of
directors who were not parties to the act, suit or
proceeding so orders, by independent legal counsel in a
written opinion; or
(d) If a quorum consisting of directors who were
not parties to the act, suit or proceeding cannot be
obtained, by independent legal counsel in a written
opinion.
5. The expenses of officers and directors incurred in
defending a civil or criminal action, suit or proceeding
must be paid by the corporation as they are incurred and in
advance of the final disposition of the action, suit or
proceeding upon receipt of an undertaking by or on behalf of
the director or officer to repay the amount if it is
ultimately determined by a court of competent jurisdiction
that he is not entitled to be indemnified by the
corporation. The provisions of this section 5 of this
Article Twelfth do not affect any rights to advancement of
expenses to which corporate personnel other than directors
or officers may be entitled under any contract or otherwise
by law.
6. The indemnification and advancement of expenses
provided by this Article Twelfth:
(a) Does not exclude any other rights to which a
person seeking indemnification or advancement of
expenses may be entitled under these articles of
incorporation or any bylaws, agreement, vote of
stockholders or disinterested directors or otherwise,
for either an action in his official capacity or an
action in another capacity while holding his office,
except that indemnification, unless ordered by a court
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pursuant to section 2 of this Article Twelfth or for
the advancement of expenses of any director or officer,
if a final adjudication establishes that his acts or
omissions involved intentional misconduct, fraud or a
knowing violation of the law and was material to the
cause of action.
(b) Continues for a person who has ceased to be a
director, officer, employee or agent and inures to the
benefit of the heirs, executors and administrators of
such a person.
7. The corporation may purchase and maintain
insurance or make other financial arrangements on behalf of
any person who is or was a director, officer, employee or
agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture,
trust or other enterprise for any liability asserted against
him and liability and expenses incurred by him in his
capacity as a director, officer, employee or agent, or
arising out of his status as such, whether or not the
corporation has the authority to indemnify him against such
liability and expenses.
8. The other financial arrangements made by the
corporation pursuant to section 7 of this Article Twelfth
may include the following:
(a) The creation of a trust fund.
(b) The establishment of a program of
self-insurance.
(c) The securing of its obligation of
indemnification by granting a security interest or
other lien on any assets of the corporation.
(d) The establishment of a letter of credit,
guaranty or surety.
No financial arrangement made pursuant to this section may
provide protection for a person adjudged by a court of
competent jurisdiction, after exhaustion of all appeals
therefrom, to be liable for intentional misconduct, fraud or
a knowing violation of law, except with respect to the
advancement of expenses or indemnification ordered by a
court.
9. Any insurance or other financial arrangement made
on behalf of a person pursuant to this Article Twelfth may
he provided by the corporation or any other person approved
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by the board of directors, even if all or part of the other
person's stock or other securities is owned by the
corporation.
10. In the absence of fraud:
(a) The decision of the board of directors as to
the propriety of the terms and conditions of any
insurance or other financial arrangement made pursuant
to this Article Twelfth and the choice of the person to
provide the insurance or other financial arrangement
shall be conclusive; and
(b) The insurance or other financial
arrangement:
(1) Is not void or voidable; and
(2) Does not subject any director approving
it to personal liability for his action, even if a
director approving the insurance or other
financial arrangement is a beneficiary of the
insurance or other financial arrangement."
(b) The registrant's Bylaws provide that the registrant
shall indemnify each and every present and former director and
officer of the registrant, and each and every person who may have
served at the registrant's request as a director or officer of
another corporation in which the registrant owns shares of
capital stock or of which the registrant is a creditor (each of
which other corporation is individually referred to herein as an
"Other Enterprise"), against any and all expenses (including
attorneys' fees) actually and necessarily incurred by him in
connection with the defense of any action, suit or proceeding in
which he was or is a party by reason of being or having been a
director or officer of the registrant or Other Enterprise to the
fullest extent permitted by law. The rights of indemnification
provided in the Bylaws are in addition to any other rights to
which a person may otherwise be entitled by any other provisions
of the registrant's Restated Articles of Incorporation, statute,
agreement, vote of stockholders or otherwise.
The registrant's Bylaws further provide that the registrant
shall indemnify officers and directors of the registrant, as well
as other persons who serve as agents and employees of the
registrant, to the extent set forth in the Restated Articles.
Additionally, the registrant's Bylaws provide that the
registrant may purchase and maintain insurance on behalf of, and
contractually agree to indemnify, any person who is or was a
director, officer, employee or agent of the registrant, or is or
was serving at the request of the registrant as a director,
II-5
officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise against any liability
asserted against him and incurred by him in any such capacity, or
arising out of his status as such, whether or not the registrant
would have the power to indemnify him against such liability
under the provisions of the Bylaws.
(c) The registrant has entered into agreements with each
Director, certain key employees, including Brian K. Harrington
and G. Stephen Holcomb, and certain directors of subsidiaries of
the registrant, that provide for the indemnification of such
individuals for certain liabilities incurred in such capacity.
Item 8. Exhibits.
(a) Exhibits.
The following documents are filed as a part of
this registration statement.
Exhibit Description of Exhibit
4.1 Restated Articles of Incorporation of Kirby Exploration
Company, Inc., as amended (incorporated by reference to
Exhibit 3.1 to the registrant's Registration Statement
on Form S-3 (Reg. No. 33-30832))
4.2 Certificate of Amendment of Restated Articles of
Incorporation of the registrant (incorporated by
reference to Exhibit 3.2 to the registrant's Annual
Report on Form 10-K for the year ended December 31,
1991)
4.3 Bylaws of the registrant, as amended, (incorporated by
reference to Exhibit 3.2 to the registrant's
Registration Statement on Form S-3 (Reg. No. 33-30832))
4.4 Amendment to Bylaws of the registrant (incorporated by
reference to Exhibit 3.4 to the registrant's Annual
Report on Form 10-K for the year ended December 31,
1991)
4.5* Kirby 401(k) Plan
23.1* Consent of KPMG Peat Marwick LLP
23.2* Consent of Deloitte & Touche LLP
____________________
* Filed herewith.
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(b) The registrant will submit the Plan in a timely manner
to the Internal Revenue Service (the "IRS") for a determination
letter that the Plan is qualified under Section 401 of the
Internal Revenue Code and will make all changes required by the
IRS in order to qualify the Plan.
Item 9. Undertakings.
A. The undersigned registrant hereby undertakes:
(1) to file, during any period in which offers or
sales are being made, a post-effective amendment to this
registration statement to include any material information
with respect to the plan of distribution not previously
disclosed in the registration statement or any material
change to such information in the registration statement;
(2) that, for the purpose of determining any liability
under the Securities Act, each such post-effective amendment
shall be deemed to be a new registration statement relating
to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial
bona fide offering thereof; and
(3) to remove from registration by means of a
post-effective amendment any of the securities being
registered which remain unsold at the termination of the
offering.
B. The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act,
each filing of the registrant's annual report pursuant to section
13(a) or section 15(d) of the Exchange Act (and, where
applicable, each filing of an employee benefit plan's annual
report pursuant to section 15(d) of the Exchange Act) that is
incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
C. Insofar as indemnification for liabilities arising
under the Securities Act may be permitted to directors, officers
and controlling persons of the registrant pursuant to the
foregoing provisions, or otherwise, the registrant has been
advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other
than the payment by the registrant of expenses incurred or paid
by a director, officer or controlling person of the registrant in
the successful defense of any action, suit or proceeding) is
II-7
asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant
will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of
appropriate jurisdiction the question of whether such
indemnification by it is against public policy as expressed in
the Securities Act and will be governed by the final adjudication
of such issue.
II-8
SIGNATURES
The Registrant. Pursuant to the requirements of the
Securities Act of 1933, the registrant certifies that it has
reasonable grounds to believe that it meets all the requirements
for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Houston, State of
Texas, on February 3, 1995:
KIRBY CORPORATION
By: /s/ George A. Peterkin,
Jr.
George A. Peterkin, Jr.,
President
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose
signature appears below constitutes and appoints George A.
Peterkin, Jr., his true and lawful attorney-in-fact and agents
with full power of substitution and resubstitution, for him and
in his name, place and stead, in any and all capacities, to sign
any and all amendments (including post-effective amendments) to
this registration statement, and to file the same with all
exhibits, thereto, and all documents in connection therewith,
with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and
authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises, as
fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that said
attorneys-in-fact and agents or either of them, or their or his
substitute or substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act, this
registration statement has been signed by the following persons
in the capacities and on the dates indicated.
Signature Capacity Date
/s/ Robert G.
Stone, Jr.
Robert G. Stone, Chairman of the Board of
Directors February
3, 1995
/s/ George A.
Peterkin, Jr.
George A. President and Director
(Principal Executive
Officer) February
3, 1995
/s/ J. H. Pyne
J. H. Pyne Executive Vice President
and Director February
3, 1995
/s/ Brian K.
Harrington
Brian K. Senior Vice President,
Treasurer and Assistant
Secretary (Principal February
3, 1995
/s/ G. Stephen
Holcomb
G. Stephen Vice President,
Controller, Assistant
Secretary and Assistant February
3, 1995
/s/ George F.
Clements, Jr.
George F. Director February
3, 1995
/s/ J. Peter
Kleifgen
J. Peter Director February
3, 1995
/s/ William M.
Lamont, Jr.
William M. Director February
3, 1995
/s/ C. W.
Murchison, III
C. W. Murchison, Director February
3, 1995
/s/ J. Virgil
Waggoner
J. Virgil Director February
3, 1995
The Plan. Pursuant to the requirements of the Securities
Act of 1933, the trustee of the Kirby 401(k) Plan has duly caused
this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Houston,
State of Texas, on February 3, 1995.
KIRBY 401(K) PLAN
By: TEXAS COMMERCE BANK
NATIONAL ASSOCIATION, Trustee
By:
Pat Rye, Vice President
EXHIBIT INDEX
Exhib
it
Numbe
r Document Description Sequen
tial
Page
Number
4.5 Kirby 401(k) Plan
23.1 Consent of KPMG Peat Marwick LLP
23.2 Consent of Deloitte & Touche LLP
EXHIBIT 4.5
Texas Commerce Bank National Association
DEFINED CONTRIBUTION MASTER PLAN
AND
TRUST AGREEMENT
TABLE OF CONTENTS
ALPHABETICAL LISTING OF DEFINITIONS . v
ARTICLE I, DEFINITIONS
1.01 Employer 1.01
1.02 Trustee 1.01
1.03 Plan 1.01
1.04 Adoption Agreement 1.01
1.05 Plan Administrator 1.02
1.06 Advisory Committee 1.02
1.07 Employee 1.02
1.08 Self-Employed Individual/Owner-Employee 1.02
1.09 Highly Compensated Employee 1.02
1.10 Participant 1.03
1.11 Beneficiary 1.03
1.12 Compensation 1.03
1.13 Earned Income 1.05
1.14 Account 1.05
1.15 Accrued Benefit 1.05
1.16 Nonforfeitable 1.05
1.17 Plan Year/Limitation Year 1.05
1.18 Effective Date 1.05
1.19 Plan Entry Date 1.05
1.20 Accounting Date 1.05
1.21 Trust 1.05
1.22 Trust Fund 1.05
1.23 Nontransferable Annuity 1.05
1.24 ERISA 1.05
1.25 Code 1.05
1.26 Service 1.05
1.27 Hour of Service 1.06
1.28 Disability 1.07
1.29 Service for Predecessor Employer 1.07
1.30 Related Employers 1.07
1.31 Leased Employees 1.07
1.32 Special Rules for Owner-Employers 1.08
1.33 Determination of Top Heavy Status 1.08
1.34 Paired Plans 1.10
1.35 Retirement Investment Trust 1.10
ARTICLE II, EMPLOYEE PARTICIPANTS
2.01 Eligibility 2.01
2.02 Year of Service - Participation 2.01
2.03 Break in Service - Participation 2.01
2.04 Participation upon Re-employment 2.02
2.05 Change in Employee Status 2.02
2.06 Election Not to Participate 2.02
ARTICLE III, EMPLOYER CONTRIBUTIONS AND FORFEITURES
3.01 Amount 3.01
3.02 Determination of Contribution 3.01
3.03 Time of Payment of Contribution 3.01
3.04 Contribution Allocation 3.01
3.05 Forfeiture Allocation 3.03
3.06 Accrual of Benefit 3.03
3.07 - 3.16 Limitations on Allocations 3.05
3.17 Special Allocation Limitation 3.07
3.18 Defined Benefit Plan Limitation 3.07
3.19 Definitions - Article III 3.07
ARTICLE IV, PARTICIPANT CONTRIBUTIONS
4.01 Participant Nondeductible Contributions 4.01
4.02 Participant Deductible Contributions 4.01
4.03 Participant Rollover Contributions 4.01
4.04 Participant Contribution - Forfeitability 4.02
4.05 Participant Contribution - Withdrawal/Distribution 4.02
4.06 Participant Contribution - Accrued Benefit 4.02
ARTICLE V, TERMINATION OF SERVICE - PARTICIPANT VESTING
5.01 Normal Retirement Age 5.01
5.02 Participant Disability or Death 5.01
5.03 Vesting Schedule 5.01
5.04 Cash-Out Distributions to Partially-Vested
Participants/Restoration
of Forfeited Accrued Benefit 5.01
5.05 Segregated Account for Repaid Amount 5.03
5.06 Year of Service - Vesting 5.03
5.07 Break in Service - Vesting 5.03
5.08 Included Years of Service - Vesting 5.03
5.09 Forfeiture Occurs 5.03
ARTICLE VI, TIME AND METHOD OF PAYMENT OF BENEFITS
6.01 Time of Payment of Accrued Benefit 6.01
6.02 Method of Payment of Accrued Benefit 6.03
6.03 Benefit Payment Elections 6.04
6.04 Annuity Distributions to Participants and Surviving
Spouses 6.06
6.05 Waiver Election - Qualified Joint and Survivor Annuity 6.07
6.06 Waiver Election - Preretirement Survivor Annuity 6.08
6.07 Distributions Under Domestic Relations Orders 6.08
ARTICLE VII, EMPLOYER ADMINISTRATIVE PROVISIONS
7.01 Information to Committee 7.01
7.02 No Liability 7.01
7.03 Indemnity of Certain Fiduciaries 7.01
7.04 Employer Direction of Investment 7.02
7.05 Amendment to Vesting Schedule 7.02
ARTICLE VIII, PARTICIPANT ADMINISTRATIVE PROVISIONS
8.01 Beneficiary Designation 8.01
8.02 No Beneficiary Designation/Death of Beneficiary 8.01
8.03 Personal Data to Committee 8.02
8.04 Address for Notification 8.02
8.05 Assignment or Alienation 8.02
II-ii
8.06 Notice of Change in Terms 8.02
8.07 Litigation Against the Trust 8.02
8.08 Information Available 8.02
8.09 Appeal Procedure for Denial of Benefits 8.02
8.10 Participant Direction of Investment 8.03
ARTICLE IX, ADVISORY COMMITTEE - DUTIES WITH RESPECT TO
PARTICIPANTS' ACCOUNTS
9.01 Members' Compensation, Expenses 9.01
9.02 Term 9.01
9.03 Powers 9.01
9.04 General 9.01
9.05 Funding Policy 9.02
9.06 Manner of Action 9.02
9.07 Authorized Representative 9.02
9.08 Interested Member 9.02
9.09 Individual Accounts 9.02
9.10 Value of Participant's Accrued Benefit 9.02
9.11 Allocation and Distribution of Net Income Gain or Loss 9.03
9.12 Individual Statement 9.03
9.13 Account Charged 9.03
9.14 Unclaimed Account Procedure 9.03
ARTICLE X, CUSTODIAN/TRUSTEE, POWERS AND DUTIES
10.01 Acceptance 10.01
10.02 Receipt of Contributions 10.01
10.03 Investment Powers 10.01
10.04 Records and Statements 10.06
10.05 Fees and Expenses from Fund 10.06
10.06 Parties to Litigation 10.06
10.07 Professional Agents 10.06
10.08 Distribution of Cash or Property 10.06
10.09 Distribution Directions 10.07
10.10 Third Party/Multiple Trustees 10.07
10.11 Resignation 10.07
10.12 Removal 10.07
10.13 Interim Duties and Successor Trustee 10.07
10.14 Valuation of Trust 10.07
10.15 Limitation on Liability - If Investment Manager,
Ancillary
Trustee or Independent Fiduciary 10.07
10.16 Investment in Group Trust Fund 10.08
10.17 Appointment of Ancillary Trustee or Independent
Fiduciary 10.08
10.18 Evidence of Action by the Advisory Committee 10.09
10.19 Allocation of Responsibilities Among Fiduciaries 10.09
10.20 Special Provisions Regarding Retirement Investment
Trusts 10.10
ARTICLE XI, PROVISIONS RELATING TO INSURANCE AND INSURANCE
COMPANY
11.01 Insurance Benefit 11.01
II-iii
11.02 Limitation on Life Insurance Protection 11.01
11.03 Definitions 11.02
11.04 Dividend Plan 11.02
11.05 Insurance Company Not a Party to Agreement 11.02
11.06 Insurance Company Not Responsible for Trustee's
Actions 11.02
11.07 Insurance Company Reliance on Trustee's Signature 11.03
11.08 Acquittance 11.03
11.09 Duties of Insurance Company 11.03
ARTICLE XII, MISCELLANEOUS
12.01 Evidence 12.01
12.02 No Responsibility for Employer Action 12.01
12.03 Fiduciaries Not Insurers 12.01
12.04 Waiver of Notice 12.01
12.05 Successors 12.01
12.06 Word Usage 12.01
12.07 State Law 12.01
12.08 Employer's Right to Participate 12.01
12.09 Employment Not Guaranteed 12.02
ARTICLE XIII, EXCLUSIVE BENEFIT, AMENDMENT, TERMINATION
13.01 Exclusive Benefit 13.01
13.02 Amendment By Employer 13.01
13.03 Amendment By Master Plan Sponsor 13.02
13.04 Discontinuance 13.02
13.05 Full Vesting on Termination 13.02
13.06 Merger/Direct Transfer 13.02
13.07 Termination 13.03
ARTICLE XIV, CODE Sect.401(k) & CODE Sect.401(m) ARRANGEMENTS
14.01 Application 14.01
14.02 Code Sect. 401(k) Arrangement 14.01
14.03 Definitions 14.02
14.04 Matching Contributions/Employee Contributions 14.03
14.05 Time of Payment of Contributions 14.03
14.06 Special Allocation Provisions - Deferral
Contributions,
Matching Contributions and Qualified Nonelective
Contributions 14.04
14.07 Annual Elective Deferral Limitation 14.05
14.08 Actual Deferral Percentage ("ADP") Test 14.06
14.09 Nondiscrimination Rules for Employer Matching
Contributions
and Participant Nondeductible Contributions 14.07
14.10 Multiple Use Limitation 14.09
14.11 Distribution Restrictions 14.10
14.12 Special Allocation Rules 14.11
ARTICLE A- APPENDIX TO BASIC PLAN DOCUMENT A-1
II-iv
ALPHABETICAL LISTING OF DEFINITIONS
Plan Definition Section Reference
(Page Number)
100% Limitation 3.19(l) (3.09)
Account 1.14 (1.05)
Accounting Date 1.20 (1.05)
Accrued Benefit 1.15 (1.05)
Actual Deferral Percentage ("ADP") Test 14.08 (14.06)
Adoption Agreement 1.04 (1.01)
Advisory Committee 1.06 (1.02)
Annual Addition 3.19(a) (3.07)
Average Contribution Percentage Test 14.09 (14.07)
Beneficiary 1.11 (1.03)
Break in Service for Eligibility Purposes 2.03 (2.01)
Break in Service for Vesting Purposes 5.07 (5.03)
Cash-out Distribution 5.04 (5.01)
Code 1.25 (1.05)
Code Sect.411(d)(6) Protected Benefits 13.02 (13.01)
Compensation 1.12 (1.03)
Compensation for Code Sect.401(k) Purposes 14.03(f) (14.02)
Compensation for Code Sect.415 Purposes 3.19(b) (3.07)
Compensation for Top Heavy Purposes 1.33(B)(3) (1.10)
Contract(s) 11.03(c) (11.02)
Custodian Designation 10.03[B] (10.03)
Deemed Cash-out Rule 5.04(C) (5.02)
Deferral Contributions 14.03(g) (14.02)
Deferral Contributions Account 14.06 (14.04)
Defined Benefit Plan 3.19(i) (3.08)
Defined Benefit Plan Fraction 3.19(j) (3.08)
Defined Contribution Plan 3.19(h) (3.08)
Defined Contribution Plan Fraction 3.19(k) (3.09)
Determination Date 1.33(B)(7) (1.10)
Disability 1.28 (1.07)
Distribution Date 6.01 (6.01)
Distribution Restrictions 14.03(m) (14.03)
Earned Income 1.13 (1.05)
Effective Date 1.18 (1.05)
Elective Deferrals 14.03(h) (14.02)
Elective Transfer 13.06(A) (13.02)
Eligible Employee 14.03(c) (14.02)
Employee 1.07 (1.02)
Employee Contributions 14.03(n) (14.03)
Employer 1.01 (1.01)
Employer Contribution Account 14.06 (14.04)
Employer for Code Sect.415 Purposes 3.19(c) (3.07)
Employer for Top Heavy Purposes 1.33(B)(6) (1.10)
Employment Commencement Date 2.02 (2.01)
ERISA 1.24 (1.05)
II-v
Excess Aggregate Contributions 14.09 (14.07)
Excess Amount 3.19(d) (3.07)
Excess Contributions 14.08 (14.06)
Exempt Participant 8.01 (8.01)
Forfeiture Break in Service 5.08 (5.03)
Group Trust Fund 10.16 (10.07)
Hardship 6.01(A)(4) (6.02)
Hardship for Code Sect.401(k) Purposes 14.11 (14.10)
Highly Compensated Employee 1.09 (1.02)
Highly Compensated Group 14.03(d) (14.02)
Hour of Service 1.27 (1.06)
Incidental Insurance Benefits 11.01 (11.01)
Insurable Participant 11.03(d) (11.02)
Investment Manager 9.04(i) (9.01)
Issuing Insurance Company 11.03(b) (11.02)
Joint and Survivor Annuity 6.04(A) (6.06)
Key Employee 1.33(B)(1) (1.10)
Leased Employees 1.31 (1.08)
Limitation Year 1.17 and 3.19(e) (1.05) and (3.08)
Loan Policy 9.04(A) (9.02)
Mandatory Contributions 14.04 (14.03)
Mandatory Contributions Account 14.04 (14.03)
Master or Prototype Plan 3.19(f) (3.08)
Matching Contributions 14.03(i) (14.03)
Maximum Permissible Amount 3.19(g) (3.08)
Minimum Distribution Incidental Benefit (MDIB) 6.02(A) (6.03)
Multiple Use Limitation 14.10 (14.09)
Named Fiduciary 10.03[D] (10.04)
Nonelective Contributions 14.03(j) (14.03)
Nonforfeitable 1.16 (1.05)
Nonhighly Compensated Employee 14.03(b) (14.02)
Nonhighly Compensated Group 14.03(e) (14.02)
Non-Key Employee 1.33(B)(2) (1.10)
Nontransferable Annuity 1.23 (1.05)
Normal Retirement Age 5.01 (5.01)
Owner-Employee 1.08 (1.02)
Paired Plans 1.34 (1.10)
Participant 1.10 (1.03)
Participant Deductible Contributions 4.02 (4.01)
Participant Forfeiture 3.05 (3.03)
Participant Loans 10.03[E] (10.05)
Participant Nondeductible Contributions 4.01 (4.01)
Permissive Aggregation Group 1.33(B)(5) (1.10)
Plan 1.03 (1.01)
Plan Administrator 1.05 (1.02)
Plan Entry Date 1.19 (1.05)
Plan Year 1.17 (1.05)
Policy 11.03(a) (11.02)
Predecessor Employer 1.29 (1.07)
Preretirement Survivor Annuity 6.04(B) (6.06)
Qualified Domestic Relations Order 6.07 (6.09)
Qualified Matching Contributions 14.03(k) (14.03)
II-vi
Qualified Nonelective Contributions 14.03(l) (14.03)
Qualifying Employer Real Property 10.03[F] (10.05)
Qualifying Employer Securities 10.03[F] (10.05)
Related Employers 1.30 (1.07)
Required Aggregation Group 1.33(B)(4) (1.10)
Required Beginning Date 6.01(B) (6.02)
Rollover Contributions 4.03 (4.01)
Self-Employed Individual 1.08 (1.02)
Service 1.26 (1.06)
Term Life Insurance Contract 11.03 (11.02)
Top Heavy Minimum Allocation 3.04(B) (3.01)
Top Heavy Ratio 1.33 (1.09)
Trust 1.21 (1.05)
Trustee 1.02 (1.01)
Trustee Designation 10.03[A] (10.01)
Trust Fund 1.22 (1.05)
Weighted Average Allocation Method 14.12 (14.11)
Year of Service for Eligibility Purposes 2.02 (2.01)
Year of Service for Vesting Purposes 5.06 (5.03)
II-vii
Texas Commerce Bank National Association
DEFINED CONTRIBUTION MASTER PLAN AND TRUST AGREEMENT
BASIC PLAN DOCUMENT # 03
Texas Commerce Bank National Association, in its capacity as
Master Plan Sponsor, establishes this Master Plan intended to
conform to and qualify under Sect.401 and Sect.501 of the
Internal Revenue Code of 1986, as amended. An Employer
establishes a Plan and Trust under this Master Plan by executing
an Adoption Agreement. If the Employer adopts this Plan as a
restated Plan in substitution for, and in amendment of, an
existing plan, the provisions of this Plan, as a restated Plan,
apply solely to an Employee whose employment with the Employer
terminates on or after the restated Effective Date of the
Employer's Plan. If an Employee's employment with the Employer
terminates prior to the restated Effective Date, that Employee is
entitled to benefits under the Plan as the Plan existed on the
date of the Employee's termination of employment.
ARTICLE I
DEFINITIONS
1.01 "Employer" means each employer who adopts this Plan by
executing an Adoption Agreement.
1.02 "Trustee" means the person or persons who as Trustee
execute the Employer's Adoption Agreement, or any successor in
office who in writing accepts the position of Trustee. The
Employer must designate in its Adoption Agreement whether the
Trustee will administer the Trust as a discretionary Trustee or
as a nondiscretionary Trustee. If a person acts as a
discretionary Trustee, the Employer also may appoint a Custodian.
See Article X. If the Master Plan Sponsor is a bank, savings and
loan, credit union or similar financial institution, a person
other than the Master Plan Sponsor (or its affiliate) may not
serve as Trustee or as Custodian of the Employer's Plan without
the written consent of the Master Plan Sponsor.
1.03 "Plan" means the retirement plan established or
continued by the Employer in the form of this Agreement,
including the Adoption Agreement under which the Employer has
elected to participate in this Master Plan. The Employer must
designate the name of the Plan in its Adoption Agreement. An
Employer may execute more than one Adoption Agreement offered
under this Master Plan, each of which will constitute a separate
Plan and Trust established or continued by that Employer. The
Plan and the Trust created by each adopting Employer is a
separate Plan and a separate Trust, independent from the plan and
the trust of any other employer adopting this Master Plan. All
section references within the Plan are Plan section references
unless the context clearly indicates otherwise.
1.04 "Adoption Agreement" means the document executed by
each Employer adopting this Master Plan. The terms of this Master
Plan as modified by the terms of an adopting Employer's Adoption
Agreement constitute a separate Plan and Trust to be construed as
a single Agreement. Each elective provision of the Adoption
Agreement corresponds by section reference to the section of the
Plan which grants the election. Each Adoption Agreement offered
under this Master Plan is either a Nonstandardized Plan or a
Standardized Plan, as identified in the preamble to that Adoption
Agreement. The provisions of this Master Plan apply equally to
Nonstandardized Plans and to Standardized Plans unless otherwise
specified.
1.05 "Plan Administrator" is the Employer unless the
Employer designates another person to hold the position of Plan
Administrator. In addition to his other duties, the Plan
Administrator has full responsibility for compliance with the
reporting and disclosure rules under the Code and ERISA as
respects the Plan and Trust.
1.06 "Advisory Committee" means the Employer's Advisory
Committee as from time to time constituted.
1.07 "Employee" means any employee (including a
Self-Employed Individual) of the Employer. The Employer must
specify in its Adoption Agreement any Employee, or class of
Employees, not eligible to participate in the Plan. If the
Employer elects to exclude collective bargaining employees, the
exclusion applies to any employee of the Employer included in a
unit of employees covered by an agreement which the Secretary of
Labor finds to be a collective bargaining agreement between
employee representatives and one or more employers unless the
collective bargaining agreement requires the employee to be
included within the Plan. The term "employee representatives"
does not include any organization more than half the members of
which are owners, officers, or executives of the Employer.
1.08 "Self-Employed Individual/Owner-Employee." "Self-
Employed Individual" means an individual who has Earned Income
(or who would have had Earned Income but for the fact that the
trade or business did not have net earnings) for the taxable year
from the trade or business for which the Plan is established.
"Owner-Employee" means a Self-Employed Individual who is the sole
proprietor in the case of a sole proprietorship. If the Employer
is a partnership, "Owner-Employee" means a Self-Employed
Individual who is a partner and owns more than 10% of either the
capital or profits interest of the partnership.
1.09 "Highly Compensated Employee" means an Employee who,
during the Plan Year or during the preceding 12-month period:
(a) is a more than 5% owner of the Employer (applying the
constructive ownership rules of Code Sect.318, and applying
the principles of Code Sect.318, for an unincorporated
entity);
(b) has Compensation in excess of $75,000 (as adjusted by
the Commissioner of Internal Revenue for the relevant year);
(c) has Compensation in excess of $50,000 (as adjusted by
the Commissioner of Internal Revenue for the relevant year)
and is part of the top-paid 20% group of employees (based on
Compensation for the relevant year); or
(d) has Compensation in excess of 50% of the dollar amount
prescribed in Code Sect.415(b)(1)(A) (relating to defined
benefit plans) and is an officer of the Employer.
If the Employee satisfies the definition in clause (b), (c)
or (d) in the Plan Year but does not satisfy clause (b), (c) or
(d) during the preceding 12-month period and does not satisfy
clause (a) in either period, the Employee is a Highly Compensated
Employee only if he is one of the 100 most highly compensated
Employees for the Plan Year. The number of officers taken into
account under clause (d) will not exceed the greater of 3 or 10%
of the total number (after application of the Code Sect.414(q)
exclusions) of Employees, but no more than 50 officers. If no
Employee satisfies the Compensation requirement in clause (d) for
the relevant year, the Advisory Committee will treat the highest
paid officer as satisfying clause (d) for that year.
For purposes of this Section 1.09, "Compensation" means
Compensation as defined in Section 1.12, except any exclusions
from Compensation elected in the Employer's Adoption Agreement
Section 1.12 do not apply, and Compensation must include
"elective contributions" (as defined in Section 1.12). The
Advisory Committee must make the determination of who is a Highly
Compensated Employee, including the determinations of the number
and identity of the top paid 20% group, the top 100 paid
Employees, the number of officers includible in clause (d) and
the relevant Compensation, consistent with Code Sect.414(q) and
regulations issued under that Code section. The Employer may make
a calendar year election to determine the Highly Compensated
Employees for the Plan Year, as prescribed by Treasury
regulations. A calendar year election must apply to all plans and
arrangements of the Employer. For purposes of applying any
nondiscrimination test required under the Plan or under the Code,
in a manner consistent with applicable Treasury regulations, the
Advisory Committee will treat a Highly Compensated Employee and
all family members (a spouse, a lineal ascendant or descendant,
or a spouse of a lineal ascendant or descendant) as a single
Highly Compensated Employee, but only if the Highly Compensated
Employee is a more than 5% owner or is one of the 10 Highly
Compensated Employees with the greatest Compensation for the Plan
Year. This aggregation rule applies to a family member even if
that family member is a Highly Compensated Employee without
family aggregation.
The term "Highly Compensated Employee" also includes any
former Employee who separated from Service (or has a deemed
Separation from Service, as determined under Treasury
regulations) prior to the Plan Year, performs no Service for the
Employer during the Plan Year, and was a Highly Compensated
Employee either for the separation year or any Plan Year ending
on or after his 55th birthday. If the former Employee's
Separation from Service occurred prior to January 1, 1987, he is
a Highly Compensated Employee only if he satisfied clause (a) of
this Section 1.09 or received Compensation in excess of $50,000
during: (1) the year of his Separation from Service (or the prior
year); or (2) any year ending after his 54th birthday.
1.10 "Participant" is an Employee who is eligible to be and
becomes a Participant in accordance with the provisions of
Section 2.01.
1.11 "Beneficiary" is a person designated by a Participant
who is or may become entitled to a benefit under the Plan. A
Beneficiary who becomes entitled to a benefit under the Plan
remains a Beneficiary under the Plan until the Trustee has fully
distributed his benefit to him. A Beneficiary's right to (and the
Plan Administrator's, the Advisory Committee's or a Trustee's
duty to provide to the Beneficiary) information or data
concerning the Plan does not arise until he first becomes
entitled to receive a benefit under the Plan.
1.12 "Compensation" means, except as provided in the
Employer's Adoption Agreement, the Participant's Earned Income,
wages, salaries, fees for professional service and other amounts
received for personal services actually rendered in the course of
employment with the Employer maintaining the plan (including, but
not limited to, commissions paid salesmen, compensation for
services on the basis of a percentage of profits, commissions on
insurance premiums, tips and bonuses). The Employer must elect in
its Adoption Agreement whether to include elective contributions
in the definition of Compensation. "Elective contributions" are
amounts excludible from the Employee's gross income under Code
Sect.Sect.125, 402(a)(8), 402(h) or 403(b), and contributed by
the Employer, at the Employee's election, to a Code Sect.401(k)
arrangement, a Simplified Employee Pension, cafeteria plan or
tax-sheltered annuity. The term "Compensation" does not include:
(a) Employer contributions (other than "elective
contributions," if includible in the definition of
Compensation under Section 1.12 of the Employer's Adoption
Agreement) to a plan of deferred compensation to the extent
the contributions are not included in the gross income of
the Employee for the taxable year in which contributed, on
behalf of an Employee to a Simplified Employee Pension Plan
to the extent such contributions are excludible from the
Employee's gross income, and any distributions from a plan
of deferred compensation, regardless of whether such amounts
are includible in the gross income of the Employee when
distributed.
(b) Amounts realized from the exercise of a non-qualified
stock option, or when restricted stock (or property) held by
an Employee either becomes freely transferable or is no
longer subject to a substantial risk of forfeiture.
(c) Amounts realized from the sale, exchange or other
disposition of stock acquired under a stock option described
in Part II, Subchapter D, Chapter 1 of the Code.
(d) Other amounts which receive special tax benefits, such
as premiums for group term life insurance (but only to the
extent that the premiums are not includible in the gross
income of the Employee), or contributions made by an
Employer (whether or not under a salary reduction agreement)
towards the purchase of an annuity contract described in
Code Sect.403(b) (whether or not the contributions are
excludible from the gross income of the Employee), other
than "elective contributions," if elected in the Employer's
Adoption Agreement.
Any reference in this Plan to Compensation is a reference to
the definition in this Section 1.12, unless the Plan reference
specifies a modification to this definition. The Advisory
Committee will take into account only Compensation actually paid
for the relevant period. A Compensation payment includes
Compensation by the Employer through another person under the
common paymaster provisions in Code Sect.Sect.3121 and 3306.
(A) Limitations on Compensation.
(1) Compensation dollar limitation. For any Plan Year
beginning after December 31, 1988, the Advisory Committee must
take into account only the first $200,000 (or beginning January
1, 1990, such larger amount as the Commissioner of Internal
Revenue may prescribe) of any Participant's Compensation. For any
Plan Year beginning prior to January 1, 1989, this $200,000
limitation (but not the family aggregation requirement described
in the next paragraph) applies only if the Plan is top heavy for
such Plan Year or operates as a deemed top heavy plan for such
Plan Year.
(2) Application of compensation limitation to certain
family members. The $200,000 Compensation limitation applies to
the combined Compensation of the Employee and of any family
member aggregated with the Employee under Section 1.09 who is
either (i) the Employee's spouse; or (ii) the Employee's lineal
descendant under the age of 19. If, for a Plan Year, the combined
Compensation of the Employee and such family members who are
Participants entitled to an allocation for that Plan Year exceeds
the $200,000 (or adjusted) limitation, "Compensation" for each
such Participant, for purposes of the contribution and allocation
provisions of Article III, means his Adjusted Compensation.
Adjusted Compensation is the amount which bears the same ratio to
the $200,000 (or adjusted) limitation as the affected
Participant's Compensation (without regard to the $200,000
Compensation limitation) bears to the combined Compensation of
all the affected Participants in the family unit. If the Plan
uses permitted disparity, the Advisory Committee must determine
the integration level of each affected family member Participant
prior to the proration of the $200,000 Compensation limitation,
but the combined integration level of the affected Participants
may not exceed $200,000 (or the adjusted limitation). The
combined Excess Compensation of the affected Participants in the
family unit may not exceed $200,000 (or the adjusted limitation)
minus the affected Participants' combined integration level (as
determined under the preceding sentence). If the combined Excess
Compensation exceeds this limitation, the Advisory Committee will
prorate the Excess Compensation limitation among the affected
Participants in the family unit in proportion to each such
individual's Adjusted Compensation minus his integration level.
If the Employer's Plan is a Nonstandardized Plan, the Employer
may elect to use a different method in determining the Adjusted
Compensation of the affected Participants by specifying that
method in an addendum to the Adoption Agreement, numbered Section
1.12.
(B) Nondiscrimination. For purposes of determining whether the
Plan discriminates in favor of Highly Compensated Employees,
Compensation means Compensation as defined in this Section 1.12,
except: (1) the Employer may elect to include or to exclude
elective contributions, irrespective of the Employer's election
in its Adoption Agreement regarding elective contributions; and
(2) the Employer will not give effect to any elections made in
the "modifications to Compensation definition" section of
Adoption Agreement Section 1.12. The Employer's election
described in clause (1) must be consistent and uniform with
respect to all Employees and all plans of the Employer for any
particular Plan Year. If the Employer's Plan is a Nonstandardized
Plan, the Employer, irrespective of clause (2), may elect to
exclude from this nondiscrimination definition of Compensation
any items of Compensation excludible under Code Sect.414(s) and
the applicable Treasury regulations, provided such adjusted
definition conforms to the nondiscrimination requirements of
those regulations.
1.13 "Earned Income" means net earnings from self-employment
in the trade or business with respect to which the Employer has
established the Plan, provided personal services of the
individual are a material income producing factor. The Advisory
Committee will determine net earnings without regard to items
excluded from gross income and the deductions allocable to those
items. The Advisory Committee will determine net earnings after
the deduction allowed to the Self-Employed Individual for all
contributions made by the Employer to a qualified plan and, for
Plan Years beginning after December 31, 1989, the deduction
allowed to the Self-Employed under Code Sect.164(f) for self-
employment taxes.
1.14 "Account" means the separate account(s) which the
Advisory Committee or the Trustee maintains for a Participant
under the Employer's Plan.
1.15 "Accrued Benefit" means the amount standing in a
Participant's Account(s) as of any date derived from both
Employer contributions and Employee contributions, if any.
1.16 "Nonforfeitable" means a Participant's or Beneficiary's
unconditional claim, legally enforceable against the Plan, to the
Participant's Accrued Benefit.
1.17 "Plan Year" means the fiscal year of the Plan, the
consecutive month period specified in the Employer's Adoption
Agreement. The Employer's Adoption Agreement also must specify
the "Limitation Year" applicable to the limitations on
allocations described in Article III. If the Employer maintains
Paired Plans, each Plan must have the same Plan Year.
1.18 "Effective Date" of this Plan is the date specified in
the Employer's Adoption Agreement.
1.19 "Plan Entry Date" means the date(s) specified in
Section 2.01 of the Employer's Adoption Agreement.
1.20 "Accounting Date" is the last day of an Employer's Plan
Year. Unless otherwise specified in the Plan, the Advisory
Committee will make all Plan allocations for a particular Plan
Year as of the Accounting Date of that Plan Year.
1.21 "Trust" means the separate Trust created under the
Employer's Plan.
1.22 "Trust Fund" means all property of every kind held or
acquired by the Employer's Plan, other than incidental benefit
insurance contracts.
1.23 "Nontransferable Annuity" means an annuity which by its
terms provides that it may not be sold, assigned, discounted,
pledged as collateral for a loan or security for the performance
of an obligation or for any purpose to any person other than the
insurance company. If the Plan distributes an annuity contract,
the contract must be a Nontransferable Annuity.
1.24 "ERISA" means the Employee Retirement Income Security
Act of 1974, as amended.
1.25 "Code" means the Internal Revenue Code of 1986, as
amended.
1.26 "Service" means any period of time the Employee is in
the employ of the Employer, including any period the Employee is
on an unpaid leave of absence authorized by the Employer under a
uniform, nondiscriminatory policy applicable to all Employees.
"Separation from Service" means the Employee no longer has an
employment relationship with the Employer maintaining this Plan.
1.27 "Hour of Service" means:
(a) Each Hour of Service for which the Employer, either
directly or indirectly, pays an Employee, or for which the
Employee is entitled to payment, for the performance of
duties. The Advisory Committee credits Hours of Service
under this paragraph (a) to the Employee for the computation
period in which the Employee performs the duties,
irrespective of when paid;
(b) Each Hour of Service for back pay, irrespective of
mitigation of damages, to which the Employer has agreed or
for which the Employee has received an award. The Advisory
Committee credits Hours of Service under this paragraph (b)
to the Employee for the computation period(s) to which the
award or the agreement pertains rather than for the
computation period in which the award, agreement or payment
is made; and
(c) Each Hour of Service for which the Employer, either
directly or indirectly, pays an Employee, or for which the
Employee is entitled to payment (irrespective of whether the
employment relationship is terminated), for reasons other
than for the performance of duties during a computation
period, such as leave of absence, vacation, holiday, sick
leave, illness, incapacity (including disability), layoff,
jury duty or military duty. The Advisory Committee will
credit no more than 501 Hours of Service under this
paragraph (c) to an Employee on account of any single
continuous period during which the Employee does not perform
any duties (whether or not such period occurs during a
single computation period). The Advisory Committee credits
Hours of Service under this paragraph (c) in accordance with
the rules of paragraphs (b) and (c) of Labor Reg.
Sect.2530.200b-2, which the Plan, by this reference,
specifically incorporates in full within this paragraph (c).
The Advisory Committee will not credit an Hour of Service
under more than one of the above paragraphs. A computation period
for purposes of this Section 1.27 is the Plan Year, Year of
Service period, Break in Service period or other period, as
determined under the Plan provision for which the Advisory
Committee is measuring an Employee's Hours of Service. The
Advisory Committee will resolve any ambiguity with respect to the
crediting of an Hour of Service in favor of the Employee.
(A) Method of crediting Hours of Service. The Employer must elect
in its Adoption Agreement the method the Advisory Committee will
use in crediting an Employee with Hours of Service. For purposes
of the Plan, "actual" method means the determination of Hours of
Service from records of hours worked and hours for which the
Employer makes payment or for which payment is due from the
Employer. If the Employer elects to apply an "equivalency"
method, for each equivalency period for which the Advisory
Committee would credit the Employee with at least one Hour of
Service, the Advisory Committee will credit the Employee with:
(i) 10 Hours of Service for a daily equivalency; (ii) 45 Hours of
Service for a weekly equivalency; (iii) 95 Hours of Service for a
semimonthly payroll period equivalency; and (iv) 190 Hours of
Service for a monthly equivalency.
(B) Maternity/paternity leave. Solely for purposes of determining
whether the Employee incurs a Break in Service under any
provision of this Plan, the Advisory Committee must credit Hours
of Service during an Employee's unpaid absence period due to
maternity or paternity leave. The Advisory Committee considers an
Employee on maternity or paternity leave if the Employee's
absence is due to the Employee's pregnancy, the birth of the
Employee's child, the placement with the Employee of an adopted
child, or the care of the Employee's child immediately following
the child's birth or placement. The Advisory Committee credits
Hours of Service under this paragraph on the basis of the number
of Hours of Service the Employee would receive if he were paid
during the absence period or, if the Advisory Committee cannot
determine the number of Hours of Service the Employee would
receive, on the basis of 8 hours per day during the absence
period. The Advisory Committee will credit only the number (not
exceeding 501) of Hours of Service necessary to prevent an
Employee's Break in Service. The Advisory Committee credits all
Hours of Service described in this paragraph to the computation
period in which the absence period begins or, if the Employee
does not need these Hours of Service to prevent a Break in
Service in the computation period in which his absence period
begins, the Advisory Committee credits these Hours of Service to
the immediately following computation period.
1.28 "Disability" means the Participant, because of a
physical or mental disability, will be unable to perform the
duties of his customary position of employment (or is unable to
engage in any substantial gainful activity) for an indefinite
period which the Advisory Committee considers will be of long
continued duration. A Participant also is disabled if he incurs
the permanent loss or loss of use of a member or function of the
body, or is permanently disfigured, and incurs a Separation from
Service. The Plan considers a Participant disabled on the date
the Advisory Committee determines the Participant satisfies the
definition of disability. The Advisory Committee may require a
Participant to submit to a physical examination in order to
confirm disability. The Advisory Committee will apply the
provisions of this Section 1.28 in a nondiscriminatory,
consistent and uniform manner. If the Employer's Plan is a
Nonstandardized Plan, the Employer may provide an alternate
definition of disability in an addendum to its Adoption
Agreement, numbered Section 1.28.
1.29 SERVICE FOR PREDECESSOR EMPLOYER. If the Employer
maintains the plan of a predecessor employer, the Plan treats
service of the Employee with the predecessor employer as service
with the Employer. If the Employer does not maintain the plan of
a predecessor employer, the Plan does not credit service with the
predecessor employer, unless the Employer identifies the
predecessor in its Adoption Agreement and specifies the purposes
for which the Plan will credit service with that predecessor
employer.
1.30 RELATED EMPLOYERS. A related group is a controlled
group of corporations (as defined in Code Sect.414(b)), trades or
businesses (whether or not incorporated) which are under common
control (as defined in Code Sect.414(c)) or an affiliated service
group (as defined in Code Sect.414(m) or in Code Sect.414(o)). If
the Employer is a member of a related group, the term "Employer"
includes the related group members for purposes of crediting
Hours of Service, determining Years of Service and Breaks in
Service under Articles II and V, applying the Participation Test
and the Coverage Test under Section 3.06(E), applying the
limitations on allocations in Part 2 of Article III, applying the
top heavy rules and the minimum allocation requirements of
Article III, the definitions of Employee, Highly Compensated
Employee, Compensation and Leased Employee, and for any other
purpose required by the applicable Code section or by a Plan
provision. However, an Employer may contribute to the Plan only
by being a signatory to the Execution Page of the Adoption
Agreement or to a Participation Agreement to the Employer's
Adoption Agreement. If one or more of the Employer's related
group members become Participating Employers by executing a
Participation Agreement to the Employer's Adoption Agreement, the
term "Employer" includes the participating related group members
for all purposes of the Plan, and "Plan Administrator" means the
Employer that is the signatory to the Execution Page of the
Adoption Agreement.
If the Employer's Plan is a Standardized Plan, all Employees
of the Employer or of any member of the Employer's related group,
are eligible to participate in the Plan, irrespective of whether
the related group member directly employing the Employee is a
Participating Employer. If the Employer's Plan is a
Nonstandardized Plan, the Employer must specify in Section 1.07
of its Adoption Agreement, whether the Employees of related group
members that are not Participating Employers are eligible to
participate in the Plan. Under a Nonstandardized Plan, the
Employer may elect to exclude from the definition of
"Compensation" for allocation purposes any Compensation received
from a related employer that has not executed a Participation
Agreement and whose Employees are not eligible to participate in
the Plan.
1.31 LEASED EMPLOYEES. The Plan treats a Leased Employee as
an Employee of the Employer. A Leased Employee is an individual
(who otherwise is not an Employee of the Employer) who, pursuant
to a leasing agreement between the Employer and any other person,
has performed services for the Employer (or for the Employer and
any persons related to the Employer within the meaning of Code
Sect.144(a)(3)) on a substantially full time basis for at least
one year and who performs services historically performed by
employees in the Employer's business field. If a Leased Employee
is treated as an Employee by reason of this Section 1.31 of the
Plan, "Compensation" includes Compensation from the leasing
organization which is attributable to services performed for the
Employer.
(A) Safe harbor plan exception. The Plan does not treat a Leased
Employee as an Employee if the leasing organization covers the
employee in a safe harbor plan and, prior to application of this
safe harbor plan exception, 20% or less of the Employer's
Employees (other than Highly Compensated Employees) are Leased
Employees. A safe harbor plan is a money purchase pension plan
providing immediate participation, full and immediate vesting,
and a nonintegrated contribution formula equal to at least 10% of
the employee's compensation without regard to employment by the
leasing organization on a specified date. The safe harbor plan
must determine the 10% contribution on the basis of compensation
as defined in Code Sect.415(c)(3) plus elective contributions (as
defined in Section 1.12).
(B) Other requirements. The Advisory Committee must apply this
Section 1.31 in a manner consistent with Code Sect.Sect.414(n)
and 414(o) and the regulations issued under those Code sections.
The Employer must specify in the Adoption Agreement the manner in
which the Plan will determine the allocation of Employer
contributions and Participant forfeitures on behalf of a
Participant if the Participant is a Leased Employee covered by a
plan maintained by the leasing organization.
1.32 SPECIAL RULES FOR OWNER-EMPLOYEES. The following
special provisions and restrictions apply to Owner-Employees:
(a) If the Plan provides contributions or benefits for an
Owner-Employee or for a group of Owner-Employees who
controls the trade or business with respect to which this
Plan is established and the Owner-Employee or
Owner-Employees also control as Owner-Employees one or more
other trades or businesses, plans must exist or be
established with respect to all the controlled trades or
businesses so that when the plans are combined they form a
single plan which satisfies the requirements of Code
Sect.401(a) and Code Sect.401(d) with respect to the
employees of the controlled trades or businesses.
(b) The Plan excludes an Owner-Employee or group of
Owner-Employees if the Owner-Employee or group of Owner-
Employees controls any other trade or business, unless the
employees of the other controlled trade or business
participate in a plan which satisfies the requirements of
Code Sect.401(a) and Code Sect.401(d). The other qualified
plan must provide contributions and benefits which are not
less favorable than the contributions and benefits provided
for the Owner-Employee or group of Owner-Employees under
this Plan, or if an Owner-Employee is covered under another
qualified plan as an Owner-Employee, then the plan
established with respect to the trade or business he does
control must provide contributions or benefits as favorable
as those provided under the most favorable plan of the trade
or business he does not control. If the exclusion of this
paragraph (b) applies and the Employer's Plan is a
Standardized Plan, the Employer may not participate or
continue to participate in this Master Plan and the
Employer's Plan becomes an individually-designed plan for
purposes of qualification reliance.
(c) For purposes of paragraphs (a) and (b) of this Section
1.32, an Owner-Employee or group of Owner-Employees controls
a trade or business if the Owner-Employee or Owner-Employees
together (1) own the entire interest in an unincorporated
trade or business, or (2) in the case of a partnership, own
more than 50% of either the capital interest or the profits
interest in the partnership.
1.33 DETERMINATION OF TOP HEAVY STATUS. If this Plan is the
only qualified plan maintained by the Employer, the Plan is top
heavy for a Plan Year if the top heavy ratio as of the
Determination Date exceeds 60%. The top heavy ratio is a
fraction, the numerator of which is the sum of the present value
of Accrued Benefits of all Key Employees as of the Determination
Date and the denominator of which is a similar sum determined for
all Employees. The Advisory Committee must include in the top
heavy ratio, as part of the present value of Accrued Benefits,
any contribution not made as of the Determination Date but
includible under Code Sect.416 and the applicable Treasury
regulations, and distributions made within the Determination
Period. The Advisory Committee must calculate the top heavy ratio
by disregarding the Accrued Benefit (and distributions, if any,
of the Accrued Benefit) of any Non-Key Employee who was formerly
a Key Employee, and by disregarding the Accrued Benefit
(including distributions, if any, of the Accrued Benefit) of an
individual who has not received credit for at least one Hour of
Service with the Employer during the Determination Period. The
Advisory Committee must calculate the top heavy ratio, including
the extent to which it must take into account distributions,
rollovers and transfers, in accordance with Code Sect.416 and the
regulations under that Code section.
If the Employer maintains other qualified plans (including a
simplified employee pension plan), or maintained another such
plan which now is terminated, this Plan is top heavy only if it
is part of the Required Aggregation Group, and the top heavy
ratio for the Required Aggregation Group and for the Permissive
Aggregation Group, if any, each exceeds 60%. The Advisory
Committee will calculate the top heavy ratio in the same manner
as required by the first paragraph of this Section 1.33, taking
into account all plans within the Aggregation Group. To the
extent the Advisory Committee must take into account
distributions to a Participant, the Advisory Committee must
include distributions from a terminated plan which would have
been part of the Required Aggregation Group if it were in
existence on the Determination Date. The Advisory Committee will
calculate the present value of accrued benefits under defined
benefit plans or simplified employee pension plans included
within the group in accordance with the terms of those plans,
Code Sect.416 and the regulations under that Code section. If a
Participant in a defined benefit plan is a Non-Key Employee, the
Advisory Committee will determine his accrued benefit under the
accrual method, if any, which is applicable uniformly to all
defined benefit plans maintained by the Employer or, if there is
no uniform method, in accordance with the slowest accrual rate
permitted under the fractional rule accrual method described in
Code Sect.411(b)(1)(C). If the Employer maintains a defined
benefit plan, the Employer must specify in Adoption Agreement
Section 3.18 the actuarial assumptions (interest and mortality
only) the Advisory Committee will use to calculate the present
value of benefits from a defined benefit plan. If an aggregated
plan does not have a valuation date coinciding with the
Determination Date, the Advisory Committee must value the Accrued
Benefits in the aggregated plan as of the most recent valuation
date falling within the twelve-month period ending on the
Determination Date, except as Code Sect.416 and applicable
Treasury regulations require for the first and second plan year
of a defined benefit plan. The Advisory Committee will calculate
the top heavy ratio with reference to the Determination Dates
that fall within the same calendar year.
(A) Standardized Plan. If the Employer's Plan is a Standardized
Plan, the Plan operates as a deemed top heavy plan in all Plan
Years, except, if the Standardized Plan includes a Code
Sect.401(k) arrangement, the Employer may elect to apply the top
heavy requirements only in Plan Years for which the Plan actually
is top heavy. Under a deemed top heavy plan, the Advisory
Committee need not determine whether the Plan actually is top
heavy. However, if the Employer, in Adoption Agreement Section
3.18, elects to override the 100% limitation, the Advisory
Committee will need to determine whether a deemed top heavy
Plan's top heavy ratio for a Plan Year exceeds 90%.
(B) Definitions. For purposes of applying the provisions of this
Section 1.33:
(1) "Key Employee" means, as of any Determination Date, any
Employee or former Employee (or Beneficiary of such
Employee) who, for any Plan Year in the Determination
Period: (i) has Compensation in excess of 50% of the dollar
amount prescribed in Code Sect.415(b)(1)(A) (relating to
defined benefit plans) and is an officer of the Employer;
(ii) has Compensation in excess of the dollar amount
prescribed in Code Sect.415(c)(1)(A) (relating to defined
contribution plans) and is one of the Employees owning the
ten largest interests in the Employer; (iii) is a more than
5% owner of the Employer; or (iv) is a more than 1% owner of
the Employer and has Compensation of more than $150,000. The
constructive ownership rules of Code Sect.318 (or the
principles of that section, in the case of an unincorporated
Employer,) will apply to determine ownership in the
Employer. The number of officers taken into account under
clause (i) will not exceed the greater of 3 or 10% of the
total number (after application of the Code Sect.414(q)
exclusions) of Employees, but no more than 50 officers. The
Advisory Committee will make the determination of who is a
Key Employee in accordance with Code Sect.416(i)(1) and the
regulations under that Code section.
(2) "Non-Key Employee" is an employee who does not meet the
definition of Key Employee.
(3) "Compensation" means Compensation as determined under
Section 1.09 for purposes of identifying Highly Compensated
Employees.
(4) "Required Aggregation Group" means: (i) each qualified
plan of the Employer in which at least one Key Employee
participates at any time during the Determination Period;
and (ii) any other qualified plan of the Employer which
enables a plan described in clause (i) to meet the
requirements of Code Sect.401(a)(4) or of Code Sect.410.
(5) "Permissive Aggregation Group" is the Required
Aggregation Group plus any other qualified plans maintained
by the Employer, but only if such group would satisfy in the
aggregate the requirements of Code Sect.401(a)(4) and of
Code Sect.410. The Advisory Committee will determine the
Permissive Aggregation Group.
(6) "Employer" means the Employer that adopts this Plan and
any related employers described in Section 1.30.
(7) "Determination Date" for any Plan Year is the Accounting
Date of the preceding Plan Year or, in the case of the first
Plan Year of the Plan, the Accounting Date of that Plan
Year. The "Determination Period" is the 5 year period ending
on the Determination Date.
1.34 "Paired Plans" means the Employer has adopted two
Standardized Plan Adoption Agreements offered with this Master
Plan, one Adoption Agreement being a Paired Profit Sharing Plan
and one Adoption Agreement being a Paired Pension Plan. A Paired
Profit Sharing Plan may include a Code Sect.401(k) arrangement. A
Paired Pension Plan must be a money purchase pension plan or a
target benefit pension plan. Paired Plans must be the subject of
a favorable opinion letter issued by the National Office of the
Internal Revenue Service. This Master Plan does not pair any of
its Standardized Plan Adoption Agreements with Standardized Plan
Adoption Agreements under a defined benefit master plan.
1.35 "Retirement Investment Trust" means the open-end,
diversified, management investment company, or any successor
thereto by change of name or otherwise, that offers collective
investment funds for retirement accounts as to which Texas
Commerce Bank National Association or an affiliated bank serves
as a trustee. The Retirement Investment Trust is explained
concisely in the current Retirement Investment Trust Prospectus.
* * * * * * * * * * * * * * *
ARTICLE II
EMPLOYEE PARTICIPANTS
2.01 ELIGIBILITY. Each Employee becomes a Participant in the
Plan in accordance with the participation option selected by the
Employer in its Adoption Agreement. If this Plan is a restated
Plan, each Employee who was a Participant in the Plan on the day
before the Effective Date continues as a Participant in the Plan,
irrespective of whether he satisfies the participation conditions
in the restated Plan, unless otherwise provided in the Employer's
Adoption Agreement.
2.02 YEAR OF SERVICE - PARTICIPATION. For purposes of an
Employee's participation in the Plan under Adoption Agreement
Section 2.01, the Plan takes into account all of his Years of
Service with the Employer, except as provided in Section 2.03.
"Year of Service" means an eligibility computation period during
which the Employee completes not less than the number of Hours of
Service specified in the Employer's Adoption Agreement. The
initial eligibility computation period is the first 12
consecutive month period measured from the Employment
Commencement Date. The Plan measures succeeding eligibility
computation periods in accordance with the option selected by the
Employer in its Adoption Agreement. If the Employer elects to
measure subsequent periods on a Plan Year basis, an Employee who
receives credit for the required number of Hours of Service
during the initial eligibility computation period and during the
first applicable Plan Year will receive credit for two Years of
Service under Article II. "Employment Commencement Date" means
the date on which the Employee first performs an Hour of Service
for the Employer. If the Employer elects a service condition
under Adoption Agreement Section 2.01 based on months, the Plan
does not apply any Hour of Service requirement after the
completion of the first Hour of Service.
2.03 BREAK IN SERVICE - PARTICIPATION. An Employee incurs
a "Break in Service" if during any 12 consecutive month period he
does not complete more than 500 Hours of Service with the
Employer. The "12 consecutive month period" under this Section
2.03 is the same 12 consecutive month period for which the Plan
measures "Years of Service" under Section 2.02.
(A) 2-year Eligibility. If the Employer elects a 2 years of
service condition for eligibility purposes under Adoption
Agreement Section 2.01, the Plan treats an Employee who incurs a
one year Break in Service and who has never become a Participant
as a new Employee on the date he first performs an Hour of
Service for the Employer after the Break in Service.
(B) Suspension of Years of Service. The Employer must elect in
its Adoption Agreement whether a Participant will incur a
suspension of Years of Service after incurring a one year Break
in Service. If this rule applies under the Employer's Plan, the
Plan disregards a Participant's Years of Service (as defined in
Section 2.02) earned prior to a Break in Service until the
Participant completes another Year of Service and the Plan
suspends the Participant's participation in the Plan. If the
Participant completes a Year of Service following his Break in
Service, the Plan restores that Participant's pre-Break Years of
Service (and the Participant resumes active participation in the
Plan) retroactively to the first day of the computation period in
which the Participant earns the first post-Break Year of Service.
The initial computation period under this Section 2.03(B) is the
12 consecutive month period measured from the date the
Participant first receives credit for an Hour of Service
following the one year Break in Service period. The Plan measures
any subsequent periods, if necessary, in a manner consistent with
the computation period selection in Adoption Agreement Section
2.02. This Section 2.03(B) does not affect a Participant's
vesting credit under Article V and, during a suspension period,
the Participant's Account continues to share fully in Trust Fund
allocations under Section 9.11. Furthermore, this Section 2.03(B)
will not result in the restoration of any Year of Service
disregarded under the Break in Service rule of Section 2.03(A).
2.04 PARTICIPATION UPON RE-EMPLOYMENT. A Participant whose
employment with the Employer terminates will re-enter the Plan as
a Participant on the date of his re-employment, subject to the
Break in Service rule, if applicable, under Section 2.03(B). An
Employee who satisfies the Plan's eligibility conditions but who
terminates employment with the Employer prior to becoming a
Participant will become a Participant on the later of the Plan
Entry Date on which he would have entered the Plan had he not
terminated employment or the date of his re-employment, subject
to the Break in Service rule, if applicable, under Section
2.03(B). Any Employee who terminates employment prior to
satisfying the Plan's eligibility conditions becomes a
Participant in accordance with Adoption Agreement Section 2.01.
2.05 CHANGE IN EMPLOYEE STATUS. If a Participant has not
incurred a Separation from Service but ceases to be eligible to
participate in the Plan, by reason of employment within an
employment classification excluded by the Employer under Adoption
Agreement Section 1.07, the Advisory Committee must treat the
Participant as an Excluded Employee during the period such a
Participant is subject to the Adoption Agreement exclusion. The
Advisory Committee determines a Participant's sharing in the
allocation of Employer contributions and Participant forfeitures,
if applicable, by disregarding his Compensation paid by the
Employer for services rendered in his capacity as an Excluded
Employee. However, during such period of exclusion, the
Participant, without regard to employment classification,
continues to receive credit for vesting under Article V for each
included Year of Service and the Participant's Account continues
to share fully in Trust Fund allocations under Section 9.11.
If an Excluded Employee who is not a Participant becomes
eligible to participate in the Plan by reason of a change in
employment classification, he will participate in the Plan
immediately if he has satisfied the eligibility conditions of
Section 2.01 and would have been a Participant had he not been an
Excluded Employee during his period of Service. Furthermore, the
Plan takes into account all of the Participant's included Years
of Service with the Employer as an Excluded Employee for purposes
of vesting credit under Article V.
2.06 ELECTION NOT TO PARTICIPATE. If the Employer's Plan is
a Standardized Plan, the Plan does not permit an otherwise
eligible Employee nor any Participant to elect not to participate
in the Plan. If the Employer's Plan is a Nonstandardized Plan,
the Employer must specify in its Adoption Agreement whether an
Employee eligible to participate, or any present Participant, may
elect not to participate in the Plan. For an election to be
effective for a particular Plan Year, the Employee or Participant
must file the election in writing with the Plan Administrator not
later than the time specified in the Employer's Adoption
Agreement. The Employer may not make a contribution under the
Plan for the Employee or for the Participant for the Plan Year
for which the election is effective, nor for any succeeding Plan
Year, unless the Employee or Participant re-elects to participate
in the Plan. After an Employee's or Participant's election not to
participate has been effective for at least the minimum period
prescribed by the Employer's Adoption Agreement, the Employee or
Participant may re-elect to participate in the Plan for any Plan
Year and subsequent Plan Years. An Employee or Participant may
re-elect to participate in the Plan by filing his election in
writing with the Plan Administrator not later than the time
specified in the Employer's Adoption Agreement. An Employee or
Participant who re-elects to participate may again elect not to
participate only as permitted in the Employer's Adoption
Agreement. If an Employee is a Self-Employed Individual, the
Employee's election (except as permitted by Treasury regulations
without creating a Code Sect.401(k) arrangement with respect to
that Self-Employed Individual) must be effective no later than
the date the Employee first would become a Participant in the
Plan and the election is irrevocable. The Plan Administrator must
furnish an Employee or a Participant any form required for
purposes of an election under this Section 2.06. An election
timely filed is effective for the entire Plan Year.
A Participant who elects not to participate may not receive
a distribution of his Accrued Benefit attributable either to
Employer or to Participant contributions except as provided under
Article IV or under Article VI. However, for each Plan Year for
which a Participant's election not to participate is effective,
the Participant's Account, if any, continues to share in Trust
Fund allocations under Article IX. Furthermore, the Employee or
the Participant receives vesting credit under Article V for each
included Year of Service during the period the election not to
participate is effective.
* * * * * * * * * * * * * * *
ARTICLE III
EMPLOYER CONTRIBUTIONS AND FORFEITURES
Part 1. Amount of Employer Contributions and Plan Allocations:
Sections 3.01 through 3.06
3.01 AMOUNT. For each Plan Year, the Employer contributes to
the Trust the amount determined by application of the
contribution option selected by the Employer in its Adoption
Agreement. The Employer may not make a contribution to the Trust
for any Plan Year to the extent the contribution would exceed the
Participants' Maximum Permissible Amounts.
The Employer contributes to this Plan on the condition its
contribution is not due to a mistake of fact and the Revenue
Service will not disallow the deduction for its contribution. The
Trustee, upon written request from the Employer, must return to
the Employer the amount of the Employer's contribution made by
the Employer by mistake of fact or the amount of the Employer's
contribution disallowed as a deduction under Code Sect.404. The
Trustee will not return any portion of the Employer's
contribution under the provisions of this paragraph more than one
year after:
(a) The Employer made the contribution by mistake of fact;
or
(b) The disallowance of the contribution as a deduction, and
then, only to the extent of the disallowance.
The Trustee will not increase the amount of the Employer
contribution returnable under this Section 3.01 for any earnings
attributable to the contribution, but the Trustee will decrease
the Employer contribution returnable for any losses attributable
to it. The Trustee may require the Employer to furnish it
whatever evidence the Trustee deems necessary to enable the
Trustee to confirm the amount the Employer has requested be
returned is properly returnable under ERISA.
3.02 DETERMINATION OF CONTRIBUTION. The Employer, from its
records, determines the amount of any contributions to be made by
it to the Trust under the terms of the Plan.
3.03 TIME OF PAYMENT OF CONTRIBUTION. The Employer may pay
its contribution for each Plan Year in one or more installments
without interest. The Employer must make its contribution to the
Plan within the time prescribed by the Code or applicable
Treasury regulations. Subject to the consent of the Trustee, the
Employer may make its contribution in property rather than in
cash, provided the contribution of property is not a prohibited
transaction under the Code or under ERISA.
3.04 CONTRIBUTION ALLOCATION.
(A) Method of Allocation. The Employer must specify in its
Adoption Agreement the manner of allocating each annual Employer
contribution to this Trust.
(B) Top Heavy Minimum Allocation. The Plan must comply with the
provisions of this Section 3.04(B), subject to the elections in
the Employer's Adoption Agreement.
(1) Top Heavy Minimum Allocation Under Standardized Plan.
Subject to the Employer's election under Section 3.04(B)(3), the
top heavy minimum allocation requirement applies to a
Standardized Plan for each Plan Year, irrespective of whether the
Plan is top heavy.
(a) Each Participant employed by the Employer on the
last day of the Plan Year will receive a top heavy
minimum allocation for that Plan Year. The Employer may
elect in Section 3.04 of its Adoption Agreement to
apply this paragraph (a) only to a Participant who is a
Non-Key Employee.
(b) Subject to any overriding elections in Section
3.18 of the Employer's Adoption Agreement, the top
heavy minimum allocation is the lesser of 3% of the
Participant's Compensation for the Plan Year or the
highest contribution rate for the Plan Year made on
behalf of any Participant for the Plan Year. However,
if the Employee participates in Paired Plans, the top
heavy minimum allocation is 3% of his Compensation. If,
under Adoption Agreement Section 3.04, the Employer
elects to apply paragraph (a) only to a Participant who
is a Non-Key Employee, the Advisory Committee will
determine the "highest contribution rate" described in
the first sentence of this paragraph (b) by reference
only to the contribution rates of Participants who are
Key Employees for the Plan Year.
(2) Top Heavy Minimum Allocation Under Nonstandardized Plan.
The top heavy minimum allocation requirement applies to a
Nonstandardized Plan only in Plan Years for which the Plan is top
heavy. Except as provided in the Employer's Adoption Agreement,
if the Plan is top heavy in any Plan Year:
(a) Each Non-Key Employee who is a Participant and is
employed by the Employer on the last day of the Plan
Year will receive a top heavy minimum allocation for
that Plan Year, irrespective of whether he satisfies
the Hours of Service condition under Section 3.06 of
the Employer's Adoption Agreement; and
(b) The top heavy minimum allocation is the lesser of
3% of the Non-Key Employee's Compensation for the Plan
Year or the highest contribution rate for the Plan Year
made on behalf of any Key Employee. However, if a
defined benefit plan maintained by the Employer which
benefits a Key Employee depends on this Plan to satisfy
the antidiscrimination rules of Code Sect.401(a)(4) or
the coverage rules of Code Sect.410 (or another plan
benefiting the Key Employee so depends on such defined
benefit plan), the top heavy minimum allocation is 3%
of the Non-Key Employee's Compensation regardless of
the contribution rate for the Key Employees.
(3) Special Election for Standardized Code Sect.401(k) Plan.
If the Employer's Plan is a Standardized Code Sect.401(k) Plan,
the Employer may elect in Adoption Agreement Section 3.04 to
apply the top heavy minimum allocation requirements of Section
3.04(B)(1) only for Plan Years in which the Plan actually is a
top heavy plan.
(4) Special Definitions. For purposes of this Section
3.04(B), the term "Participant" includes any Employee otherwise
eligible to participate in the Plan but who is not a Participant
because of his Compensation level or because of his failure to
make elective deferrals under a Code Sect.401(k) arrangement or
because of his failure to make mandatory contributions. For
purposes of subparagraph (1)(b) or (2)(b), "Compensation" means
Compensation as defined in Section 1.12, except Compensation does
not include elective contributions, irrespective of whether the
Employer has elected to include these amounts in Section 1.12 of
its Adoption Agreement, any exclusion selected in Section 1.12 of
the Adoption Agreement (other than the exclusion of elective
contributions) does not apply, and any modification to the
definition of Compensation in Section 3.06 does not apply.
(5) Determining Contribution Rates. For purposes of this
Section 3.04(B), a Participant's contribution rate is the sum of
all Employer contributions (not including Employer contributions
to Social Security) and forfeitures allocated to the
Participant's Account for the Plan Year divided by his
Compensation for the entire Plan Year. However, for purposes of
satisfying a Participant's top heavy minimum allocation in Plan
Years beginning after December 31, 1988, the Participant's
contribution rate does not include any elective contributions
under a Code Sect.401(k) arrangement nor any Employer matching
contributions allocated on the basis of those elective
contributions or on the basis of employee contributions, except a
Nonstandardized Plan may include in the contribution rate any
matching contributions not necessary to satisfy the
nondiscrimination requirements of Code Sect.401(k) or of Code
Sect.401(m).
If the Employee is a Participant in Paired Plans, the
Advisory Committee will consider the Paired Plans as a single
Plan to determine a Participant's contribution rate and to
determine whether the Plans satisfy this top heavy minimum
allocation requirement. To determine a Participant's contribution
rate under a Nonstandardized Plan, the Advisory Committee must
treat all qualified top heavy defined contribution plans
maintained by the Employer (or by any related Employers described
in Section 1.30) as a single plan.
(6) No Allocations. If, for a Plan Year, there are no
allocations of Employer contributions or forfeitures for any
Participant (for purposes of Section 3.04 (B)(1)(b)) or for any
Key Employee (for purposes of Section 3.04(B)(2)(b)), the Plan
does not require any top heavy minimum allocation for the Plan
Year, unless a top heavy minimum allocation applies because of
the maintenance by the Employer of more than one plan.
(7) Election of Method. The Employer must specify in its
Adoption Agreement the manner in which the Plan will satisfy the
top heavy minimum allocation requirement.
(a) If the Employer elects to make any necessary additional
contribution to this Plan, the Advisory Committee first will
allocate the Employer contributions (and Participant
forfeitures, if any) for the Plan Year in accordance with
the provisions of Adoption Agreement Section 3.04. The
Employer then will contribute an additional amount for the
Account of any Participant entitled under this Section
3.04(B) to a top heavy minimum allocation and whose
contribution rate for the Plan Year, under this Plan and any
other plan aggregated under paragraph (5), is less than the
top heavy minimum allocation. The additional amount is the
amount necessary to increase the Participant's contribution
rate to the top heavy minimum allocation. The Advisory
Committee will allocate the additional contribution to the
Account of the Participant on whose behalf the Employer
makes the contribution.
(b) If the Employer elects to guarantee the top heavy
minimum allocation under another plan, this Plan does not
provide the top heavy minimum allocation and the Advisory
Committee will allocate the annual Employer contributions
(and Participant forfeitures) under the Plan solely in
accordance with the allocation method selected under
Adoption Agreement Section 3.04.
3.05 FORFEITURE ALLOCATION. The amount of a Participant's
Accrued Benefit forfeited under the Plan is a Participant
forfeiture. The Advisory Committee will allocate Participant
forfeitures in the manner specified by the Employer in its
Adoption Agreement. The Advisory Committee will continue to hold
the undistributed, non-vested portion of a terminated
Participant's Accrued Benefit in his Account solely for his
benefit until a forfeiture occurs at the time specified in
Section 5.09 or if applicable, until the time specified in
Section 9.14. Except as provided under Section 5.04, a
Participant will not share in the allocation of a forfeiture of
any portion of his Accrued Benefit.
3.06 ACCRUAL OF BENEFIT. The Advisory Committee will
determine the accrual of benefit (Employer contributions and
Participant forfeitures) on the basis of the Plan Year in
accordance with the Employer's elections in its Adoption
Agreement.
(A) Compensation Taken Into Account. The Employer must specify in
its Adoption Agreement the Compensation the Advisory Committee is
to take into account in allocating an Employer contribution to a
Participant's Account for the Plan Year in which the Employee
first becomes a Participant. For all other Plan Years, the
Advisory Committee will take into account only the Compensation
determined for the portion of the Plan Year in which the Employee
actually is a Participant. The Advisory Committee must take into
account the Employee's entire Compensation for the Plan Year to
determine whether the Plan satisfies the top heavy minimum
allocation requirement of Section 3.04(B). The Employer, in an
addendum to its Adoption Agreement numbered 3.06(A), may elect to
measure Compensation for the Plan Year for allocation purposes on
the basis of a specified period other than the Plan Year.
(B) Hours of Service Requirement. Subject to the applicable
minimum allocation requirement of Section 3.04, the Advisory
Committee will not allocate any portion of an Employer
contribution for a Plan Year to any Participant's Account if the
Participant does not complete the applicable minimum Hours of
Service requirement specified in the Employer's Adoption
Agreement.
(C) Employment Requirement. If the Employer's Plan is a
Standardized Plan, a Participant who, during a particular Plan
Year, completes the accrual requirements of Adoption Agreement
Section 3.06 will share in the allocation of Employer
contributions for that Plan Year without regard to whether he is
employed by the Employer on the Accounting Date of that Plan
Year. If the Employer's Plan is a Nonstandardized Plan, the
Employer must specify in its Adoption Agreement whether the
Participant will accrue a benefit if he is not employed by the
Employer on the Accounting Date of the Plan Year. If the
Employer's Plan is a money purchase plan or a target benefit
plan, whether Nonstandardized or Standardized, the Plan
conditions benefit accrual on employment with the Employer on the
last day of the Plan Year for the Plan Year in which the Employer
terminates the Plan.
(D) Other Requirements. If the Employer's Adoption Agreement
includes options for other requirements affecting the
Participant's accrual of benefits under the Plan, the Advisory
Committee will apply this Section 3.06 in accordance with the
Employer's Adoption Agreement selections.
(E) Suspension of Accrual Requirements Under Nonstandardized
Plan. If the Employer's Plan is a Nonstandardized Plan, the
Employer may elect in its Adoption Agreement to suspend the
accrual requirements elected under Adoption Agreement Section
3.06 if, for any Plan Year beginning after December 31, 1989, the
Plan fails to satisfy the Participation Test or the Coverage
Test. A Plan satisfies the Participation Test if, on each day of
the Plan Year, the number of Employees who benefit under the Plan
is at least equal to the lesser of 50 or 40% of the total number
of Includible Employees as of such day. A Plan satisfies the
Coverage Test if, on the last day of each quarter of the Plan
Year, the number of Nonhighly Compensated Employees who benefit
under the Plan is at least equal to 70% of the total number of
Includible Nonhighly Compensated Employees as of such day.
"Includible" Employees are all Employees other than: (1) those
Employees excluded from participating in the Plan for the entire
Plan Year by reason of the collective bargaining unit exclusion
or the nonresident alien exclusion under Adoption Agreement
Section 1.07 or by reason of the participation requirements of
Sections 2.01 and 2.03; and (2) any Employee who incurs a
Separation from Service during the Plan Year and fails to
complete at least 501 Hours of Service for the Plan Year. A
"Nonhighly Compensated Employee" is an Employee who is not a
Highly Compensated Employee and who is not a family member
aggregated with a Highly Compensated Employee pursuant to Section
1.09 of the Plan.
For purposes of the Participation Test and the Coverage
Test, an Employee is benefiting under the Plan on a particular
date if, under Adoption Agreement Section 3.04, he is entitled to
an allocation for the Plan Year. Under the Participation Test,
when determining whether an Employee is entitled to an allocation
under Adoption Agreement Section 3.04, the Advisory Committee
will disregard any allocation required solely by reason of the
top heavy minimum allocation, unless the top heavy minimum
allocation is the only allocation made under the Plan for the
Plan Year.
If this Section 3.06(E) applies for a Plan Year, the
Advisory Committee will suspend the accrual requirements for the
Includible Employees who are Participants, beginning first with
the Includible Employee(s) employed with the Employer on the last
day of the Plan Year, then the Includible Employee(s) who have
the latest Separation from Service during the Plan Year, and
continuing to suspend in descending order the accrual
requirements for each Includible Employee who incurred an earlier
Separation from Service, from the latest to the earliest
Separation from Service date, until the Plan satisfies both the
Participation Test and the Coverage Test for the Plan Year. If
two or more Includible Employees have a Separation from Service
on the same day, the Advisory Committee will suspend the accrual
requirements for all such Includible Employees, irrespective of
whether the Plan can satisfy the Participation Test and the
Coverage Test by accruing benefits for fewer than all such
Includible Employees. If the Plan suspends the accrual
requirements for an Includible Employee, that Employee will share
in the allocation of Employer contributions and Participant
forfeitures, if any, without regard to the number of Hours of
Service he has earned for the Plan Year and without regard to
whether he is employed by the Employer on the last day of the
Plan Year. If the Employer's Plan includes Employer matching
contributions subject to Code Sect.401(m), this suspension of
accrual requirements applies separately to the Code Sect.401(m)
portion of the Plan, and the Advisory Committee will treat an
Employee as benefiting under that portion of the Plan if he is an
Eligible Employee for purposes of the Code Sect.401(m)
nondiscrimination test. The Employer may modify the operation of
this Section 3.06(E) by electing appropriate modifications in
Section 3.06 of its Adoption Agreement.
Part 2. Limitations On Allocations: Sections 3.07 through 3.19
[Note: Sections 3.07 through 3.10 apply only to Participants
in this Plan who do not participate, and who have never
participated, in another qualified plan or in a welfare benefit
fund (as defined in Code Sect.419(e)) maintained by the
Employer.]
3.07 The amount of Annual Additions which the Advisory
Committee may allocate under this Plan on a Participant's behalf
for a Limitation Year may not exceed the Maximum Permissible
Amount. If the amount the Employer otherwise would contribute to
the Participant's Account would cause the Annual Additions for
the Limitation Year to exceed the Maximum Permissible Amount, the
Employer will reduce the amount of its contribution so the Annual
Additions for the Limitation Year will equal the Maximum
Permissible Amount. If an allocation of Employer contributions,
pursuant to Section 3.04, would result in an Excess Amount (other
than an Excess Amount resulting from the circumstances described
in Section 3.10) to the Participant's Account, the Advisory
Committee will reallocate the Excess Amount to the remaining
Participants who are eligible for an allocation of Employer
contributions for the Plan Year in which the Limitation Year
ends. The Advisory Committee will make this reallocation on the
basis of the allocation method under the Plan as if the
Participant whose Account otherwise would receive the Excess
Amount is not eligible for an allocation of Employer
contributions.
3.08 Prior to the determination of the Participant's actual
Compensation for a Limitation Year, the Advisory Committee may
determine the Maximum Permissible Amount on the basis of the
Participant's estimated annual Compensation for such Limitation
Year. The Advisory Committee must make this determination on a
reasonable and uniform basis for all Participants similarly
situated. The Advisory Committee must reduce any Employer
contributions (including any allocation of forfeitures) based on
estimated annual Compensation by any Excess Amounts carried over
from prior years.
3.09 As soon as is administratively feasible after the end
of the Limitation Year, the Advisory Committee will determine the
Maximum Permissible Amount for such Limitation Year on the basis
of the Participant's actual Compensation for such Limitation
Year.
3.10 If, pursuant to Section 3.09, or because of the
allocation of forfeitures, there is an Excess Amount with respect
to a Participant for a Limitation Year, the Advisory Committee
will dispose of such Excess Amount as follows:
(a) The Advisory Committee will return any nondeductible
voluntary Employee contributions to the Participant to the
extent the return would reduce the Excess Amount.
(b) If, after the application of paragraph (a), an Excess
Amount still exists, and the Plan covers the Participant at
the end of the Limitation Year, then the Advisory Committee
will use the Excess Amount(s) to reduce future Employer
contributions (including any allocation of forfeitures)
under the Plan for the next Limitation Year and for each
succeeding Limitation Year, as is necessary, for the
Participant. If the Employer's Plan is a profit sharing
plan, the Participant may elect to limit his Compensation
for allocation purposes to the extent necessary to reduce
his allocation for the Limitation Year to the Maximum
Permissible Amount and eliminate the Excess Amount.
(c) If, after the application of paragraph (a), an Excess
Amount still exists, and the Plan does not cover the
Participant at the end of the Limitation Year, then the
Advisory Committee will hold the Excess Amount unallocated
in a suspense account. The Advisory Committee will apply the
suspense account to reduce Employer Contributions (including
allocation of forfeitures) for all remaining Participants in
the next Limitation Year, and in each succeeding Limitation
Year if necessary. Neither the Employer nor any Employee may
contribute to the Plan for any Limitation Year in which the
Plan is unable to allocate fully a suspense account
maintained pursuant to this paragraph (c).
(d) The Advisory Committee will not distribute any Excess
Amount(s) to Participants or to former Participants.
[Note: Sections 3.11 through 3.16 apply only to Participants
who, in addition to this Plan, participate in one or more plans
(including Paired Plans), all of which are qualified Master or
Prototype defined contribution plans or welfare benefit funds (as
defined in Code Sect.419(e)) maintained by the Employer during
the Limitation Year.]
3.11 The amount of Annual Additions which the Advisory
Committee may allocate under this Plan on a Participant's behalf
for a Limitation Year may not exceed the Maximum Permissible
Amount, reduced by the sum of any Annual Additions allocated to
the Participant's Accounts for the same Limitation Year under
this Plan and such other defined contribution plan. If the amount
the Employer otherwise would contribute to the Participant's
Account under this Plan would cause the Annual Additions for the
Limitation Year to exceed this limitation, the Employer will
reduce the amount of its contribution so the Annual Additions
under all such plans for the Limitation Year will equal the
Maximum Permissible Amount. If an allocation of Employer
contributions, pursuant to Section 3.04, would result in an
Excess Amount (other than an Excess Amount resulting from the
circumstances described in Section 3.10) to the Participant's
Account, the Advisory Committee will reallocate the Excess Amount
to the remaining Participants who are eligible for an allocation
of Employer contributions for the Plan Year in which the
Limitation Year ends. The Advisory Committee will make this
reallocation on the basis of the allocation method under the Plan
as if the Participant whose Account otherwise would receive the
Excess Amount is not eligible for an allocation of Employer
contributions.
3.12 Prior to the determination of the Participant's actual
Compensation for the Limitation Year, the Advisory Committee may
determine the amounts referred to in 3.11 above on the basis of
the Participant's estimated annual Compensation for such
Limitation Year. The Advisory Committee will make this
determination on a reasonable and uniform basis for all
Participants similarly situated. The Advisory Committee must
reduce any Employer contribution (including allocation of
forfeitures) based on estimated annual Compensation by any Excess
Amounts carried over from prior years.
3.13 As soon as is administratively feasible after the end
of the Limitation Year, the Advisory Committee will determine the
amounts referred to in 3.11 on the basis of the Participant's
actual Compensation for such Limitation Year.
3.14 If pursuant to Section 3.13, or because of the
allocation of forfeitures, a Participant's Annual Additions under
this Plan and all such other plans result in an Excess Amount,
such Excess Amount will consist of the Amounts last allocated.
The Advisory Committee will determine the Amounts last allocated
by treating the Annual Additions attributable to a welfare
benefit fund as allocated first, irrespective of the actual
allocation date under the welfare benefit fund.
3.15 The Employer must specify in its Adoption Agreement the
Excess Amount attributed to this Plan, if the Advisory Committee
allocates an Excess Amount to a Participant on an allocation date
of this Plan which coincides with an allocation date of another
plan.
3.16 The Advisory Committee will dispose of any Excess
Amounts attributed to this Plan as provided in Section 3.10.
[Note: Section 3.17 applies only to Participants who, in
addition to this Plan, participate in one or more qualified plans
which are qualified defined contribution plans other than a
Master or Prototype plan maintained by the Employer during the
Limitation Year.]
3.17 SPECIAL ALLOCATION LIMITATION. The amount of Annual
Additions which the Advisory Committee may allocate under this
Plan on behalf of any Participant are limited in accordance with
the provisions of Section 3.11 through 3.16, as though the other
plan were a Master or Prototype plan, unless the Employer
provides other limitations in an addendum to the Adoption
Agreement, numbered Section 3.17.
3.18 DEFINED BENEFIT PLAN LIMITATION. If the Employer
maintains a defined benefit plan, or has ever maintained a
defined benefit plan which the Employer has terminated, then the
sum of the defined benefit plan fraction and the defined
contribution plan fraction for any Participant for any Limitation
Year must not exceed 1.0. The Employer must provide in Adoption
Agreement Section 3.18 the manner in which the Plan will satisfy
this limitation. The Employer also must provide in its Adoption
Agreement Section 3.18 the manner in which the Plan will satisfy
the top heavy requirements of Code Sect.416 after taking into
account the existence (or prior maintenance) of the defined
benefit plan.
3.19 DEFINITIONS - ARTICLE III. For purposes of Article III,
the following terms mean:
(a) "Annual Addition" - The sum of the following amounts
allocated on behalf of a Participant for a Limitation Year,
of (i) all Employer contributions; (ii) all forfeitures; and
(iii) all Employee contributions. Except to the extent
provided in Treasury regulations, Annual Additions include
excess contributions described in Code Sect.401(k), excess
aggregate contributions described in Code Sect.401(m) and
excess deferrals described in Code Sect.402(g), irrespective
of whether the plan distributes or forfeits such excess
amounts. Annual Additions also include Excess Amounts
reapplied to reduce Employer contributions under Section
3.10. Amounts allocated after March 31, 1984, to an
individual medical account (as defined in Code
Sect.415(l)(2)) included as part of a defined benefit plan
maintained by the Employer are Annual Additions.
Furthermore, Annual Additions include contributions paid or
accrued after December 31, 1985, for taxable years ending
after December 31, 1985, attributable to post-retirement
medical benefits allocated to the separate account of a key
employee (as defined in Code Sect.419A(d)(3)) under a
welfare benefit fund (as defined in Code Sect.419(e))
maintained by the Employer.
(b) "Compensation" - For purposes of applying the
limitations of Part 2 of this Article III, "Compensation"
means Compensation as defined in Section 1.12, except
Compensation does not include elective contributions,
irrespective of whether the Employer has elected to include
these amounts as Compensation under Section 1.12 of its
Adoption Agreement, and any exclusion selected in Section
1.12 of the Adoption Agreement (other than the exclusion of
elective contributions) does not apply.
(c) "Employer" - The Employer that adopts this Plan and any
related employers described in Section 1.30. Solely for
purposes of applying the limitations of Part 2 of this
Article III, the Advisory Committee will determine related
employers described in Section 1.30 by modifying Code
Sect.Sect.414(b) and (c) in accordance with Code
Sect.415(h).
(d) "Excess Amount" - The excess of the Participant's Annual
Additions for the Limitation Year over the Maximum
Permissible Amount.
(e) "Limitation Year" - The period selected by the Employer
under Adoption Agreement Section 1.17. All qualified plans
of the Employer must use the same Limitation Year. If the
Employer amends the Limitation Year to a different 12
consecutive month period, the new Limitation Year must begin
on a date within the Limitation Year for which the Employer
makes the amendment, creating a short Limitation Year.
(f) "Master or Prototype Plan" - A plan the form of which is
the subject of a favorable notification letter or a
favorable opinion letter from the Internal Revenue Service.
(g) "Maximum Permissible Amount" - The lesser of (i) $30,000
(or, if greater, one-fourth of the defined benefit dollar
limitation under Code Sect.415(b)(1)(A)), or (ii) 25% of the
Participant's Compensation for the Limitation Year. If there
is a short Limitation Year because of a change in Limitation
Year, the Advisory Committee will multiply the $30,000 (or
adjusted) limitation by the following fraction:
Number of months in the short Limitation Year
12
(h) "Defined contribution plan" - A retirement plan which
provides for an individual account for each participant and
for benefits based solely on the amount contributed to the
participant's account, and any income, expenses, gains and
losses, and any forfeitures of accounts of other
participants which the plan may allocate to such
participant's account. The Advisory Committee must treat all
defined contribution plans (whether or not terminated)
maintained by the Employer as a single plan. Solely for
purposes of the limitations of Part 2 of this Article III,
the Advisory Committee will treat employee contributions
made to a defined benefit plan maintained by the Employer as
a separate defined contribution plan. The Advisory Committee
also will treat as a defined contribution plan an individual
medical account (as defined in Code Sect.415(l)(2)) included
as part of a defined benefit plan maintained by the Employer
and, for taxable years ending after December 31, 1985, a
welfare benefit fund under Code Sect.419(e) maintained by
the Employer to the extent there are post-retirement medical
benefits allocated to the separate account of a key employee
(as defined in Code Sect.419A(d)(3)).
(i) "Defined benefit plan" - A retirement plan which does
not provide for individual accounts for Employer
contributions. The Advisory Committee must treat all defined
benefit plans (whether or not terminated) maintained by the
Employer as a single plan.
[Note: The definitions in paragraphs (j), (k) and (l) apply only
if the limitation described in Section 3.18 applies to the
Employer's Plan.]
(j) "Defined benefit plan fraction" -
Projected annual benefit of the Participant under the defined
benefit plan(s)
The lesser of (i) 125% (subject to the "100% limitation" in
paragraph (l)) of the
dollar limitation in effect under Code Sect. 415(b)(1)(A) for the
Limitation Year,
or (ii) 140% of the Participant's average Compensation for his
high three (3) consecutive Years of Service
To determine the denominator of this fraction, the
Advisory Committee will make any adjustment required under
Code Sect.415(b) and will determine a Year of Service,
unless otherwise provided in an addendum to Adoption
Agreement Section 3.18, as a Plan Year in which the Employee
completed at least 1,000 Hours of Service. The "projected
annual benefit" is the annual retirement benefit (adjusted
to an actuarially equivalent straight life annuity if the
plan expresses such benefit in a form other than a straight
life annuity or qualified joint and survivor annuity) of the
Participant under the terms of the defined benefit plan on
the assumptions he continues employment until his normal
retirement age (or current age, if later) as stated in the
defined benefit plan, his compensation continues at the same
rate as in effect in the Limitation Year under consideration
until the date of his normal retirement age and all other
relevant factors used to determine benefits under the
defined benefit plan remain constant as of the current
Limitation Year for all future Limitation Years.
Current Accrued Benefit. If the Participant accrued
benefits in one or more defined benefit plans maintained by
the Employer which were in existence on May 6, 1986, the
dollar limitation used in the denominator of this fraction
will not be less than the Participant's Current Accrued
Benefit. A Participant's Current Accrued Benefit is the sum
of the annual benefits under such defined benefit plans
which the Participant had accrued as of the end of the 1986
Limitation Year (the last Limitation Year beginning before
January 1, 1987), determined without regard to any change in
the terms or conditions of the Plan made after May 5, 1986,
and without regard to any cost of living adjustment
occurring after May 5, 1986. This Current Accrued Benefit
rule applies only if the defined benefit plans individually
and in the aggregate satisfied the requirements of Code
Sect.415 as in effect at the end of the 1986 Limitation
Year.
(k) "Defined contribution plan fraction" -
The sum, as of the close of the Limitation Year, of the Annual
Additions
to the Participant's Account under the defined
contribution plan(s)
The sum of the lesser of the following amounts determined
for the Limitation Year and for each prior Year of Service with
the Employer:(i) 125%
(subject to the "100% limitation" in paragraph (l)) of the dollar
limitation in effect under
Code Sect.415(c)(1)(A) for the Limitation Year (determined
without regard to
the special dollar limitations for employee stock ownership
plans), or
(ii) 35% of the Participant's Compensation for the Limitation
Year
For purposes of determining the defined contribution
plan fraction, the Advisory Committee will not recompute
Annual Additions in Limitation Years beginning prior to
January 1, 1987, to treat all Employee contributions as
Annual Additions. If the Plan satisfied Code Sect.415 for
Limitation Years beginning prior to January 1, 1987, the
Advisory Committee will redetermine the defined contribution
plan fraction and the defined benefit plan fraction as of
the end of the 1986 Limitation Year, in accordance with this
Section 3.19. If the sum of the redetermined fractions
exceeds 1.0, the Advisory Committee will subtract
permanently from the numerator of the defined contribution
plan fraction an amount equal to the product of (1) the
excess of the sum of the fractions over 1.0, times (2) the
denominator of the defined contribution plan fraction. In
making the adjustment, the Advisory Committee must disregard
any accrued benefit under the defined benefit plan which is
in excess of the Current Accrued Benefit. This Plan
continues any transitional rules applicable to the
determination of the defined contribution plan fraction
under the Employer's Plan as of the end of the 1986
Limitation Year.
(l) "100% limitation." If the 100% limitation applies, the
Advisory Committee must determine the denominator of the
defined benefit plan fraction and the denominator of the
defined contribution plan fraction by substituting 100% for
125%. If the Employer's Plan is a Standardized Plan, the
100% limitation applies in all Limitation Years, subject to
any override provisions under Section 3.18 of the Employer's
Adoption Agreement. If the Employer overrides the 100%
limitation under a Standardized Plan, the Employer must
specify in its Adoption Agreement the manner in which the
Plan satisfies the extra minimum benefit requirement of Code
Sect.416(h) and the 100% limitation must continue to apply
if the Plan's top heavy ratio exceeds 90%. If the Employer's
Plan is a Nonstandardized Plan, the 100% limitation applies
only if: (i) the Plan's top heavy ratio exceeds 90%; or (ii)
the Plan's top heavy ratio is greater than 60%, and the
Employer does not elect in its Adoption Agreement Section
3.18 to provide extra minimum benefits which satisfy Code
Sect.416(h)(2).
* * * * * * * * * * * * * * *
ARTICLE IV
PARTICIPANT CONTRIBUTIONS
4.01 PARTICIPANT NONDEDUCTIBLE CONTRIBUTIONS. This Plan does
not permit Participant nondeductible contributions unless the
Employer maintains its Plan under a Code Sect.401(k) Adoption
Agreement. If the Employer does not maintain its Plan under a
Code Sect.401(k) Adoption Agreement and, prior to the adoption of
this Master Plan, the Plan accepted Participant nondeductible
contributions for a Plan Year beginning after December 31, 1986,
those contributions must satisfy the requirements of Code
Sect.401(m). This Section 4.01 does not prohibit the Plan's
acceptance of Participant nondeductible contributions prior to
the first Plan Year commencing after the Plan Year in which the
Employer adopts this Master Plan.
4.02 PARTICIPANT DEDUCTIBLE CONTRIBUTIONS. A qualified Plan
may not accept Participant deductible contributions after April
15, 1987. If the Employer's Plan includes Participant deductible
contributions ("DECs") made prior to April 16, 1987, the Advisory
Committee must maintain a separate accounting for the
Participant's Accrued Benefit attributable to DECs, including
DECs which are part of a rollover contribution described in
Section 4.03. The Advisory Committee will treat the accumulated
DECs as part of the Participant's Accrued Benefit for all
purposes of the Plan, except for purposes of determining the top
heavy ratio under Section 1.33. The Advisory Committee may not
use DECs to purchase life insurance on the Participant's behalf.
4.03 PARTICIPANT ROLLOVER CONTRIBUTIONS. Any Participant,
with the Employer's written consent and after filing with the
Trustee the form prescribed by the Advisory Committee, may
contribute cash or other property to the Trust other than as a
voluntary contribution if the contribution is a "rollover
contribution" which the Code permits an employee to transfer
either directly or indirectly from one qualified plan to another
qualified plan. Before accepting a rollover contribution, the
Trustee may require an Employee to furnish satisfactory evidence
that the proposed transfer is in fact a "rollover contribution"
which the Code permits an employee to make to a qualified plan. A
rollover contribution is not an Annual Addition under Part 2 of
Article III.
The Trustee will invest the rollover contribution in a
segregated investment Account for the Participant's sole benefit
unless the Trustee (or the Named Fiduciary, in the case of a
nondiscretionary Trustee designation), in its sole discretion,
agrees to invest the rollover contribution as part of the Trust
Fund. The Trustee will not have any investment responsibility
with respect to a Participant's segregated rollover Account. The
Participant, however, from time to time, may direct the Trustee
in writing as to the investment of his segregated rollover
Account in property, or property interests, of any kind, real,
personal or mixed; provided however, the Participant may not
direct the Trustee to make loans to his Employer. A Participant's
segregated rollover Account alone will bear any extraordinary
expenses resulting from investments made at the direction of the
Participant. As of the Accounting Date (or other valuation date)
for each Plan Year, the Advisory Committee will allocate and
credit the net income (or net loss) from a Participant's
segregated rollover Account and the increase or decrease in the
fair market value of the assets of a segregated rollover Account
solely to that Account. The Trustee is not liable nor responsible
for any loss resulting to any Beneficiary, nor to any
Participant, by reason of any sale or investment made or other
action taken pursuant to and in accordance with the direction of
the Participant. In all other respects, the Trustee will hold,
administer and distribute a rollover contribution in the same
manner as any Employer contribution made to the Trust.
An eligible Employee, prior to satisfying the Plan's
eligibility conditions, may make a rollover contribution to the
Trust to the same extent and in the same manner as a Participant.
If an Employee makes a rollover contribution to the Trust prior
to satisfying the Plan's eligibility conditions, the Advisory
Committee and Trustee must treat the Employee as a Participant
for all purposes of the Plan except the Employee is not a
Participant for purposes of sharing in Employer contributions or
Participant forfeitures under the Plan until he actually becomes
a Participant in the Plan. If the Employee has a Separation from
Service prior to becoming a Participant, the Trustee will
distribute his rollover contribution Account to him as if it were
an Employer contribution Account.
4.04 PARTICIPANT CONTRIBUTION - FORFEITABILITY. A
Participant's Accrued Benefit is, at all times, 100%
Nonforfeitable to the extent the value of his Accrued Benefit is
derived from his Participant contributions described in this
Article IV.
4.05 PARTICIPANT CONTRIBUTION - WITHDRAWAL/DISTRIBUTION. A
Participant, by giving prior written notice to the Trustee, may
withdraw all or any part of the value of his Accrued Benefit
derived from his Participant contributions described in this
Article IV. A distribution of Participant contributions must
comply with the joint and survivor requirements described in
Article VI, if those requirements apply to the Participant. A
Participant may not exercise his right to withdraw the value of
his Accrued Benefit derived from his Participant contributions
more than once during any Plan Year. The Trustee, in accordance
with the direction of the Advisory Committee, will distribute a
Participant's unwithdrawn Accrued Benefit attributable to his
Participant contributions in accordance with the provisions of
Article VI applicable to the distribution of the Participant's
Nonforfeitable Accrued Benefit.
4.06 PARTICIPANT CONTRIBUTION - ACCRUED BENEFIT. The
Advisory Committee must maintain a separate Account(s) in the
name of each Participant to reflect the Participant's Accrued
Benefit under the Plan derived from his Participant
contributions. A Participant's Accrued Benefit derived from his
Participant contributions as of any applicable date is the
balance of his separate Participant contribution Account(s).
* * * * * * * * * * * * * * *
ARTICLE V
TERMINATION OF SERVICE - PARTICIPANT VESTING
5.01 NORMAL RETIREMENT AGE. The Employer must define Normal
Retirement Age in its Adoption Agreement. A Participant's Accrued
Benefit derived from Employer contributions is 100%
Nonforfeitable upon and after his attaining Normal Retirement Age
(if employed by the Employer on or after that date).
5.02 PARTICIPANT DISABILITY OR DEATH. The Employer may elect
in its Adoption Agreement to provide a Participant's Accrued
Benefit derived from Employer contributions will be 100%
Nonforfeitable if the Participant's Separation from Service is a
result of his death or his disability.
5.03 VESTING SCHEDULE. Except as provided in Sections 5.01
and 5.02, for each Year of Service, a Participant's
Nonforfeitable percentage of his Accrued Benefit derived from
Employer contributions equals the percentage in the vesting
schedule completed by the Employer in its Adoption Agreement.
(A) Election of Special Vesting Formula. If the Trustee makes a
distribution (other than a cash-out distribution described in
Section 5.04) to a partially-vested Participant, and the
Participant has not incurred a Forfeiture Break in Service at the
relevant time, the Advisory Committee will establish a separate
Account for the Participant's Accrued Benefit. At any relevant
time following the distribution, the Advisory Committee will
determine the Participant's Nonforfeitable Accrued Benefit
derived from Employer contributions in accordance with the
following formula: P(AB + (R x D)) - (R x D).
To apply this formula, "P" is the Participant's current
vesting percentage at the relevant time, "AB" is the
Participant's Employer-derived Accrued Benefit at the relevant
time, "R" is the ratio of "AB" to the Participant's Employer-
derived Accrued Benefit immediately following the earlier
distribution and "D" is the amount of the earlier distribution.
If, under a restated Plan, the Plan has made distribution to a
partially-vested Participant prior to its restated Effective Date
and is unable to apply the cash-out provisions of Section 5.04 to
that prior distribution, this special vesting formula also
applies to that Participant's remaining Account. The Employer, in
an addendum to its Adoption Agreement, numbered Section 5.03, may
elect to modify this formula to read as follows: P(AB + D) - D.
5.04 CASH-OUT DISTRIBUTIONS TO PARTIALLY-VESTED
PARTICIPANTS/ RESTORATION OF FORFEITED ACCRUED BENEFIT. If,
pursuant to Article VI, a partially-vested Participant receives a
cash-out distribution before he incurs a Forfeiture Break in
Service (as defined in Section 5.08), the cash-out distribution
will result in an immediate forfeiture of the nonvested portion
of the Participant's Accrued Benefit derived from Employer
contributions. See Section 5.09. A partially-vested Participant
is a Participant whose Nonforfeitable Percentage determined under
Section 5.03 is less than 100%. A cash-out distribution is a
distribution of the entire present value of the Participant's
Nonforfeitable Accrued Benefit.
(A) Restoration and Conditions upon Restoration. A partially-
vested Participant who is re-employed by the Employer after
receiving a cash-out distribution of the Nonforfeitable
percentage of his Accrued Benefit may repay the Trustee the
amount of the cash-out distribution attributable to Employer
contributions, unless the Participant no longer has a right to
restoration by reason of the conditions of this Section 5.04(A).
If a partially-vested Participant makes the cash-out distribution
repayment, the Advisory Committee, subject to the conditions of
this Section 5.04(A), must restore his Accrued Benefit
attributable to Employer contributions to the same dollar amount
as the dollar amount of his Accrued Benefit on the Accounting
Date, or other valuation date, immediately preceding the date of
the cash-out distribution, unadjusted for any gains or losses
occurring subsequent to that Accounting Date, or other valuation
date. Restoration of the Participant's Accrued Benefit includes
restoration of all Code Sect.411(d)(6) protected benefits with
respect to that restored Accrued Benefit, in accordance with
applicable Treasury regulations. The Advisory Committee will not
restore a re-employed Participant's Accrued Benefit under this
paragraph if:
(1) 5 years have elapsed since the Participant's first re-
employment date with the Employer following the cash-out
distribution; or
(2) The Participant incurred a Forfeiture Break in Service
(as defined in Section 5.08). This condition also applies if
the Participant makes repayment within the Plan Year in
which he incurs the Forfeiture Break in Service and that
Forfeiture Break in Service would result in a complete
forfeiture of the amount the Advisory Committee otherwise
would restore.
(B) Time and Method of Restoration. If neither of the two
conditions preventing restoration of the Participant's Accrued
Benefit applies, the Advisory Committee will restore the
Participant's Accrued Benefit as of the Plan Year Accounting Date
coincident with or immediately following the repayment. To
restore the Participant's Accrued Benefit, the Advisory
Committee, to the extent necessary, will allocate to the
Participant's Account:
(1) First, the amount, if any, of Participant forfeitures
the Advisory Committee would otherwise allocate under
Section 3.05;
(2) Second, the amount, if any, of the Trust Fund net income
or gain for the Plan Year; and
(3) Third, the Employer contribution for the Plan Year to
the extent made under a discretionary formula.
In an addendum to its Adoption Agreement numbered 5.04(B),
the Employer may eliminate as a means of restoration any of the
amounts described in clauses (1), (2) and (3) or may change the
order of priority of these amounts. To the extent the amounts
described in clauses (1), (2) and (3) are insufficient to enable
the Advisory Committee to make the required restoration, the
Employer must contribute, without regard to any requirement or
condition of Section 3.01, the additional amount necessary to
enable the Advisory Committee to make the required restoration.
If, for a particular Plan Year, the Advisory Committee must
restore the Accrued Benefit of more than one re-employed
Participant, then the Advisory Committee will make the
restoration allocations to each such Participant's Account in the
same proportion that a Participant's restored amount for the Plan
Year bears to the restored amount for the Plan Year of all
re-employed Participants. The Advisory Committee will not take
into account any allocation under this Section 5.04 in applying
the limitation on allocations under Part 2 of Article III.
(C) 0% Vested Participant. The Employer must specify in its
Adoption Agreement whether the deemed cash-out rule applies to a
0% vested Participant. A 0% vested Participant is a Participant
whose Accrued Benefit derived from Employer contributions is
entirely forfeitable at the time of his Separation from Service.
If the Participant's Account is not entitled to an allocation of
Employer contributions for the Plan Year in which he has a
Separation from Service, the Advisory Committee will apply the
deemed cash-out rule as if the 0% vested Participant received a
cash-out distribution on the date of the Participant's Separation
from Service. If the Participant's Account is entitled to an
allocation of Employer contributions or Participant forfeitures
for the Plan Year in which he has a Separation from Service, the
Advisory Committee will apply the deemed cash-out rule as if the
0% vested Participant received a cash-out distribution on the
first day of the first Plan Year beginning after his Separation
from Service. For purposes of applying the restoration provisions
of this Section 5.04, the Advisory Committee will treat the 0%
vested Participant as repaying his cash-out "distribution" on the
first date of his re-employment with the Employer. If the deemed
cash-out rule does not apply to the Employer's Plan, a 0% vested
Participant will not incur a forfeiture until he incurs a
Forfeiture Break in Service.
5.05 SEGREGATED ACCOUNT FOR REPAID AMOUNT. Until the
Advisory Committee restores the Participant's Accrued Benefit, as
described in Section 5.04, the Trustee will invest the cash-out
amount the Participant has repaid in a segregated Account
maintained solely for that Participant. The Trustee must invest
the amount in the Participant's segregated Account in Federally
insured interest bearing savings account(s) or time deposit(s)
(or a combination of both), or in other fixed income investments.
Until commingled with the balance of the Trust Fund on the date
the Advisory Committee restores the Participant's Accrued
Benefit, the Participant's segregated Account remains a part of
the Trust, but it alone shares in any income it earns and it
alone bears any expense or loss it incurs. Unless the repayment
qualifies as a rollover contribution, the Advisory Committee will
direct the Trustee to repay to the Participant as soon as is
administratively practicable the full amount of the Participant's
segregated Account if the Advisory Committee determines either of
the conditions of Section 5.04(A) prevents restoration as of the
applicable Accounting Date, notwithstanding the Participant's
repayment.
5.06 YEAR OF SERVICE - VESTING. For purposes of vesting
under Section 5.03, Year of Service means any 12-consecutive
month period designated in the Employer's Adoption Agreement
during which an Employee completes not less than the number of
Hours of Service (not exceeding 1,000) specified in the
Employer's Adoption Agreement. A Year of Service includes any
Year of Service earned prior to the Effective Date of the Plan,
except as provided in Section 5.08.
5.07 BREAK IN SERVICE - VESTING. For purposes of this
Article V, a Participant incurs a "Break in Service" if during
any vesting computation period he does not complete more than 500
Hours of Service. If, pursuant to Section 5.06, the Plan does not
require more than 500 Hours of Service to receive credit for a
Year of Service, a Participant incurs a Break in Service in a
vesting computation period in which he fails to complete a Year
of Service.
5.08 INCLUDED YEARS OF SERVICE - VESTING. For purposes of
determining "Years of Service" under Section 5.06, the Plan takes
into account all Years of Service an Employee completes with the
Employer except:
(a) For the sole purpose of determining a Participant's
Nonforfeitable percentage of his Accrued Benefit derived
from Employer contributions which accrued for his benefit
prior to a Forfeiture Break in Service, the Plan disregards
any Year of Service after the Participant first incurs a
Forfeiture Break in Service. The Participant incurs a
Forfeiture Break in Service when he incurs 5 consecutive
Breaks in Service.
(b) The Plan disregards any Year of Service excluded under
the Employer's Adoption Agreement.
The Plan does not apply the Break in Service rule under Code
Sect.411(a)(6)(B). Therefore, an Employee need not complete a
Year of Service after a Break in Service before the Plan takes
into account the Employee's otherwise includible Years of Service
under this Article V.
5.09 FORFEITURE OCCURS. A Participant's forfeiture, if any,
of his Accrued Benefit derived from Employer contributions occurs
under the Plan on the earlier of:
(a) The last day of the vesting computation period in which
the Participant first incurs a Forfeiture Break in Service;
or
(b) The date the Participant receives a cash-out
distribution.
The Advisory Committee determines the percentage of a
Participant's Accrued Benefit forfeiture, if any, under this
Section 5.09 solely by reference to the vesting schedule of
Section 5.03. A Participant does not forfeit any portion of his
Accrued Benefit for any other reason or cause except as expressly
provided by this Section 5.09 or as provided under Section 9.14.
* * * * * * * * * * * * * * *
ARTICLE VI
TIME AND METHOD OF PAYMENT OF BENEFITS
6.01 TIME OF PAYMENT OF ACCRUED BENEFIT. Unless, pursuant to
Section 6.03, the Participant or the Beneficiary elects in
writing to a different time or method of payment, the Advisory
Committee will direct the Trustee to commence distribution of a
Participant's Nonforfeitable Accrued Benefit in accordance with
this Section 6.01. A Participant must consent, in writing, to any
distribution required under this Section 6.01 if the present
value of the Participant's Nonforfeitable Accrued Benefit, at the
time of the distribution to the Participant, exceeds $3,500 and
the Participant has not attained the later of Normal Retirement
Age or age 62. Furthermore, the Participant's spouse also must
consent, in writing, to any distribution, for which Section 6.04
requires the spouse's consent. For all purposes of this Article
VI, the term "annuity starting date" means the first day of the
first period for which the Plan pays an amount as an annuity or
in any other form. A distribution date under this Article VI,
unless otherwise specified within the Plan, is the date or dates
the Employer specifies in the Adoption Agreement, or as soon as
administratively practicable following that distribution date.
For purposes of the consent requirements under this Article VI,
if the present value of the Participant's Nonforfeitable Accrued
Benefit, at the time of any distribution, exceeds $3,500, the
Advisory Committee must treat that present value as exceeding
$3,500 for purposes of all subsequent Plan distributions to the
Participant.
(A) Separation from Service For a Reason Other Than Death.
(1) Participant's Nonforfeitable Accrued Benefit Not
Exceeding $3,500. If the Participant's Separation from Service
is for any reason other than death, the Advisory Committee will
direct the Trustee to distribute the Participant's Nonforfeitable
Accrued Benefit in a lump sum, on the distribution date the
Employer specifies in the Adoption Agreement, but in no event
later than the 60th day following the close of the Plan Year in
which the Participant attains Normal Retirement Age. If the
Participant has attained Normal Retirement Age at the time of his
Separation from Service, the distribution under this paragraph
will occur no later than the 60th day following the close of the
Plan Year in which the Participant's Separation from Service
occurs.
(2) Participant's Nonforfeitable Accrued Benefit Exceeds
$3,500. If the Participant's Separation from Service is for any
reason other than death, the Advisory Committee will direct the
Trustee to commence distribution of the Participant's
Nonforfeitable Accrued Benefit in a form and at the time elected
by the Participant, pursuant to Section 6.03. In the absence of
an election by the Participant, the Advisory Committee will
direct the Trustee to distribute the Participant's Nonforfeitable
Accrued Benefit in a lump sum (or, if applicable, the normal
annuity form of distribution required under Section 6.04), on the
60th day following the close of the Plan Year in which the latest
of the following events occurs: (a) the Participant attains
Normal Retirement Age; (b) the Participant attains age 62; or (c)
the Participant's Separation from Service.
(3) Disability. If the Participant's Separation from Service
is because of his disability, the Advisory Committee will direct
the Trustee to pay the Participant's Nonforfeitable Accrued
Benefit in lump sum, on the distribution date the Employer
specifies in the Adoption Agreement, subject to the notice and
consent requirements of this Article VI and subject to the
applicable mandatory commencement dates described in Paragraphs
(1) and (2).
(4) Hardship. Prior to the time at which the Participant may
receive distribution under Paragraphs (1), (2) or (3), the
Participant may request a distribution from his Nonforfeitable
Accrued Benefit in an amount necessary to satisfy a hardship, if
the Employer elects in the Adoption Agreement to permit hardship
distributions. Unless the Employer elects otherwise in the
Adoption Agreement, a hardship distribution must be on account of
any of the following: (a) medical expenses; (b) the purchase
(excluding mortgage payments) of the Participant's principal
residence; (c) post-secondary education tuition, for the next
semester or quarter, for the Participant or for the Participant's
spouse, children or dependents; (d) to prevent the eviction of
the Participant from his principal residence or the foreclosure
on the mortgage of the Participant's principal residence; (e)
funeral expenses of the Participant's family member; or (f) the
Participant's disability. A partially-vested Participant may not
receive a hardship distribution described in this Paragraph
(A)(4) prior to incurring a Forfeiture Break in Service, unless
the hardship distribution is a cash-out distribution (as defined
in Article V). The Advisory Committee will direct the Trustee to
make the hardship distribution as soon as administratively
practicable after the Participant makes a valid request for the
hardship distribution.
(B) Required Beginning Date. If any distribution commencement
date described under Paragraph (A) of this Section 6.01, either
by Plan provision or by Participant election (or nonelection), is
later than the Participant's Required Beginning Date, the
Advisory Committee instead must direct the Trustee to make
distribution on the Participant's Required Beginning Date,
subject to the transitional election, if applicable, under
Section 6.03(D). A Participant's Required Beginning Date is the
April 1 following the close of the calendar year in which the
Participant attains age 70 1/2. However, if the Participant, prior
to incurring a Separation from Service, attained age 70 1/2 by
January 1, 1988, and, for the five Plan Year period ending in the
calendar year in which he attained age 70 1/2 and for all subsequent
years, the Participant was not a more than 5% owner, the Required
Beginning Date is the April 1 following the close of the calendar
year in which the Participant separates from Service or, if
earlier, the April 1 following the close of the calendar year in
which the Participant becomes a more than 5% owner. Furthermore,
if a Participant who was not a more than 5% owner attained age
70 1/2 during 1988 and did not incur a Separation from Service prior
to January 1, 1989, his Required Beginning Date is April 1, 1990.
A mandatory distribution at the Participant's Required Beginning
Date will be in lump sum (or, if applicable, the normal annuity
form of distribution required under Section 6.04) unless the
Participant, pursuant to the provisions of this Article VI, makes
a valid election to receive an alternative form of payment.
(C) Death of the Participant. The Advisory Committee will direct
the Trustee, in accordance with this Section 6.01(C), to
distribute to the Participant's Beneficiary the Participant's
Nonforfeitable Accrued Benefit remaining in the Trust at the time
of the Participant's death. Subject to the requirements of
Section 6.04, the Advisory Committee will determine the death
benefit by reducing the Participant's Nonforfeitable Accrued
Benefit by any security interest the Plan has against that
Nonforfeitable Accrued Benefit by reason of an outstanding
Participant loan.
(1) Deceased Participant's Nonforfeitable Accrued Benefit
Does Not Exceed $3,500. The Advisory Committee, subject to the
requirements of Section 6.04, must direct the Trustee to
distribute the deceased Participant's Nonforfeitable Accrued
Benefit in a single sum, as soon as administratively practicable
following the Participant's death or, if later, the date on which
the Advisory Committee receives notification of or otherwise
confirms the Participant's death.
(2) Deceased Participant's Nonforfeitable Accrued Benefit
Exceeds $3,500. The Advisory Committee will direct the Trustee to
distribute the deceased Participant's Nonforfeitable Accrued
Benefit at the time and in the form elected by the Participant
or, if applicable by the Beneficiary, as permitted under this
Article VI. In the absence of an election, subject to the
requirements of Section 6.04, the Advisory Committee will direct
the Trustee to distribute the Participant's undistributed
Nonforfeitable Accrued Benefit in a lump sum on the first
distribution date following the close of the Plan Year in which
the Participant's death occurs or, if later, the first
distribution date following the date the Advisory Committee
receives notification of or otherwise confirms the Participant's
death.
If the death benefit is payable in full to the Participant's
surviving spouse, the surviving spouse, in addition to the
distribution options provided in this Section 6.01(C), may elect
distribution at any time or in any form (other than a joint and
survivor annuity) this Article VI would permit for a Participant.
6.02 METHOD OF PAYMENT OF ACCRUED BENEFIT. Subject to the
annuity distribution requirements, if any, prescribed by Section
6.04, and any restrictions prescribed by Section 6.03, a
Participant or Beneficiary may elect distribution under one, or
any combination, of the following methods: (a) by payment in a
lump sum; or (b) by payment in monthly, quarterly or annual
installments over a fixed reasonable period of time, not
exceeding the life expectancy of the Participant, or the joint
life and last survivor expectancy of the Participant and his
Beneficiary. The Employer may elect in its Adoption Agreement to
modify the methods of payment available under this Section 6.02.
The distribution options permitted under this Section 6.02
are available only if the present value of the Participant
Nonforfeitable Accrued Benefit, at the time of the distribution
to the Participant, exceeds $3,500. To facilitate installment
payments under this Article VI, the Advisory Committee may direct
the Trustee to segregate all or any part of the Participant's
Accrued Benefit in a separate Account. The Trustee will invest
the Participant's segregated Account in Federally insured
interest bearing savings account(s) or time deposit(s) (or a
combination of both), or in other fixed income investments. A
segregated Account remains a part of the Trust, but it alone
shares in any income it earns, and it alone bears any expense or
loss it incurs. A Participant or Beneficiary may elect to receive
an installment distribution in the form of a Nontransferable
Annuity Contract. Under an installment distribution, the
Participant or Beneficiary, at any time, may elect to accelerate
the payment of all, or any portion, of the Participant's unpaid
Nonforfeitable Accrued Benefit, subject to the requirements of
Section 6.04.
(A) Minimum Distribution Requirements for Participants. The
Advisory Committee may not direct the Trustee to distribute the
Participant's Nonforfeitable Accrued Benefit, nor may the
Participant elect to have the Trustee distribute his
Nonforfeitable Accrued Benefit, under a method of payment which,
as of the Required Beginning Date, does not satisfy the minimum
distribution requirements under Code Sect.401(a)(9) and the
applicable Treasury regulations. The minimum distribution for a
calendar year equals the Participant's Nonforfeitable Accrued
Benefit as of the latest valuation date preceding the beginning
of the calendar year divided by the Participant's life expectancy
or, if applicable, the joint and last survivor expectancy of the
Participant and his designated Beneficiary (as determined under
Article VIII, subject to the requirements of the Code
Sect.401(a)(9) regulations). The Advisory Committee will increase
the Participant's Nonforfeitable Accrued Benefit, as determined
on the relevant valuation date, for contributions or forfeitures
allocated after the valuation date and by December 31 of the
valuation calendar year, and will decrease the valuation by
distributions made after the valuation date and by December 31 of
the valuation calendar year. For purposes of this valuation, the
Advisory Committee will treat any portion of the minimum
distribution for the first distribution calendar year made after
the close of that year as a distribution occurring in that first
distribution calendar year. In computing a minimum distribution,
the Advisory Committee must use the unisex life expectancy
multiples under Treas. Reg. Sect.1.72-9. The Advisory Committee,
only upon the Participant's written request, will compute the
minimum distribution for a calendar year subsequent to the first
calendar year for which the Plan requires a minimum distribution
by redetermining the applicable life expectancy. However, the
Advisory Committee may not redetermine the joint life and last
survivor expectancy of the Participant and a nonspouse designated
Beneficiary in a manner which takes into account any adjustment
to a life expectancy other than the Participant's life
expectancy.
If the Participant's spouse is not his designated
Beneficiary, a method of payment to the Participant (whether by
Participant election or by Advisory Committee direction) may not
provide more than incidental benefits to the Beneficiary. For
Plan Years beginning after December 31, 1988, the Plan must
satisfy the minimum distribution incidental benefit ("MDIB")
requirement in the Treasury regulations issued under Code
Sect.401(a)(9) for distributions made on or after the
Participant's Required Beginning Date and before the
Participant's death. To satisfy the MDIB requirement, the
Advisory Committee will compute the minimum distribution required
by this Section 6.02(A) by substituting the applicable MDIB
divisor for the applicable life expectancy factor, if the MDIB
divisor is a lesser number. Following the Participant's death,
the Advisory Committee will compute the minimum distribution
required by this Section 6.02(A) solely on the basis of the
applicable life expectancy factor and will disregard the MDIB
factor. For Plan Years beginning prior to January 1, 1989, the
Plan satisfies the incidental benefits requirement if the
distributions to the Participant satisfied the MDIB requirement
or if the present value of the retirement benefits payable solely
to the Participant is greater than 50% of the present value of
the total benefits payable to the Participant and his
Beneficiaries. The Advisory Committee must determine whether
benefits to the Beneficiary are incidental as of the date the
Trustee is to commence payment of the retirement benefits to the
Participant, or as of any date the Trustee redetermines the
payment period to the Participant.
The minimum distribution for the first distribution calendar
year is due by the Participant's Required Beginning Date. The
minimum distribution for each subsequent distribution calendar
year, including the calendar year in which the Participant's
Required Beginning Date occurs, is due by December 31 of that
year. If the Participant receives distribution in the form of a
Nontransferable Annuity Contract, the distribution satisfies this
Section 6.02(A) if the contract complies with the requirements of
Code Sect.401(a)(9) and the applicable Treasury regulations.
(B) Minimum Distribution Requirements for Beneficiaries. The
method of distribution to the Participant's Beneficiary must
satisfy Code Sect.401(a)(9) and the applicable Treasury
regulations. If the Participant's death occurs after his Required
Beginning Date or, if earlier, the date the Participant commences
an irrevocable annuity pursuant to Section 6.04, the method of
payment to the Beneficiary must provide for completion of payment
over a period which does not exceed the payment period which had
commenced for the Participant. If the Participant's death occurs
prior to his Required Beginning Date, and the Participant had not
commenced an irrevocable annuity pursuant to Section 6.04, the
method of payment to the Beneficiary, subject to Section 6.04,
must provide for completion of payment to the Beneficiary over a
period not exceeding: (i) 5 years after the date of the
Participant's death; or (ii) if the Beneficiary is a designated
Beneficiary, the designated Beneficiary's life expectancy. The
Advisory Committee may not direct payment of the Participant's
Nonforfeitable Accrued Benefit over a period described in clause
(ii) unless the Trustee will commence payment to the designated
Beneficiary no later than the December 31 following the close of
the calendar year in which the Participant's death occurred or,
if later, and the designated Beneficiary is the Participant's
surviving spouse, December 31 of the calendar year in which the
Participant would have attained age 70 1/2. If the Trustee will make
distribution in accordance with clause (ii), the minimum
distribution for a calendar year equals the Participant's
Nonforfeitable Accrued Benefit as of the latest valuation date
preceding the beginning of the calendar year divided by the
designated Beneficiary's life expectancy. The Advisory Committee
must use the unisex life expectancy multiples under Treas. Reg.
Sect.1.72-9 for purposes of applying this paragraph. The Advisory
Committee, only upon the written request of the Participant or of
the Participant's surviving spouse, will recalculate the life
expectancy of the Participant's surviving spouse not more
frequently than annually, but may not recalculate the life
expectancy of a nonspouse designated Beneficiary after the
Trustee commences payment to the designated Beneficiary. The
Advisory Committee will apply this paragraph by treating any
amount paid to the Participant's child, which becomes payable to
the Participant's surviving spouse upon the child's attaining the
age of majority, as paid to the Participant's surviving spouse.
Upon the Beneficiary's written request, the Advisory Committee
must direct the Trustee to accelerate payment of all, or any
portion, of the Participant's unpaid Accrued Benefit, as soon as
administratively practicable following the effective date of that
request.
6.03 BENEFIT PAYMENT ELECTIONS. Not earlier than 90 days,
but not later than 30 days, before the Participant's annuity
starting date, the Advisory Committee must provide a benefit
notice to a Participant who is eligible to make an election under
this Section 6.03. The benefit notice must explain the optional
forms of benefit in the Plan, including the material features and
relative values of those options, and the Participant's right to
defer distribution until he attains the later of Normal
Retirement Age or age 62.
If a Participant or Beneficiary makes an election prescribed
by this Section 6.03, the Advisory Committee will direct the
Trustee to distribute the Participant's Nonforfeitable Accrued
Benefit in accordance with that election. Any election under this
Section 6.03 is subject to the requirements of Section 6.02 and
of Section 6.04. The Participant or Beneficiary must make an
election under this Section 6.03 by filing his election with the
Advisory Committee at any time before the Trustee otherwise would
commence to pay a Participant's Accrued Benefit in accordance
with the requirements of Article VI.
(A) Participant Elections After Separation from Service. If the
present value of a Participant's Nonforfeitable Accrued Benefit
exceeds $3,500, he may elect to have the Trustee commence
distribution as of any distribution date permitted under the
Employer's Adoption Agreement Section 6.03. The Participant may
reconsider an election at any time prior to the annuity starting
date and elect to commence distribution as of any other
distribution date permitted under the Employer's Adoption
Agreement Section 6.03. If the Participant is partially-vested in
his Accrued Benefit, an election under this Paragraph (A) to
distribute prior to the Participant's incurring a Forfeiture
Break in Service (as defined in Section 5.08), must be in the
form of a cash-out distribution (as defined in Article V). A
Participant may not receive a cash-out distribution if, prior to
the time the Trustee actually makes the cash-out distribution,
the Participant returns to employment with the Employer.
Following his attainment of Normal Retirement Age, a Participant
who has separated from Service may elect distribution as of any
distribution date, irrespective of the elections under Adoption
Agreement Section 6.03.
(B) Participant Elections Prior to Separation from Service. The
Employer must specify in its Adoption Agreement the distribution
election rights, if any, a Participant has prior to his
Separation from Service. A Participant must make an election
under this Section 6.03(B) on a form prescribed by the Advisory
Committee at any time during the Plan Year for which his election
is to be effective. In his written election, the Participant must
specify the percentage or dollar amount he wishes the Trustee to
distribute to him. The Participant's election relates solely to
the percentage or dollar amount specified in his election form
and his right to elect to receive an amount, if any, for a
particular Plan Year greater than the dollar amount or percentage
specified in his election form terminates on the Accounting Date.
The Trustee must make a distribution to a Participant in
accordance with his election under this Section 6.03(B) within
the 90 day period (or as soon as administratively practicable)
after the Participant files his written election with the
Trustee. The Trustee will distribute the balance of the
Participant's Accrued Benefit not distributed pursuant to his
election(s) in accordance with the other distribution provisions
of this Plan.
(C) Death Benefit Elections. If the present value of the deceased
Participant's Nonforfeitable Accrued Benefit exceeds $3,500, the
Participant's Beneficiary may elect to have the Trustee
distribute the Participant's Nonforfeitable Accrued Benefit in a
form and within a period permitted under Section 6.02. The
Beneficiary's election is subject to any restrictions designated
in writing by the Participant and not revoked as of his date of
death.
(D) Transitional Elections. Notwithstanding the provisions of
Sections 6.01 and 6.02, if the Participant (or Beneficiary)
signed a written distribution designation prior to January 1,
1984, the Advisory Committee must distribute the Participant's
Nonforfeitable Accrued Benefit in accordance with that
designation, subject however, to the survivor requirements, if
applicable, of Sections 6.04, 6.05 and 6.06. This Section 6.03(D)
does not apply to a pre-1984 distribution designation, and the
Advisory Committee will not comply with that designation, if any
of the following applies: (1) the method of distribution would
have disqualified the Plan under Code Sect.401(a)(9) as in effect
on December 31, 1983; (2) the Participant did not have an Accrued
Benefit as of December 31, 1983; (3) the distribution designation
does not specify the timing and form of the distribution and the
death Beneficiaries (in order of priority); (4) the substitution
of a Beneficiary modifies the payment period of the distribution;
or, (5) the Participant (or Beneficiary) modifies or revokes the
distribution designation. In the event of a revocation, the Plan
must distribute, no later than December 31 of the calendar year
following the year of revocation, the amount which the
Participant would have received under Section 6.02(A) if the
distribution designation had not been in effect or, if the
Beneficiary revokes the distribution designation, the amount
which the Beneficiary would have received under Section 6.02(B)
if the distribution designation had not been in effect. The
Advisory Committee will apply this Section 6.03(D) to rollovers
and transfers in accordance with Part J of the Code
Sect.401(a)(9) Treasury regulations.
6.04 ANNUITY DISTRIBUTIONS TO PARTICIPANTS AND
SURVIVING SPOUSES.
(A) Joint and Survivor Annuity. The Advisory Committee must
direct the Trustee to distribute a married or unmarried
Participant's Nonforfeitable Accrued Benefit in the form of a
qualified joint and survivor annuity, unless the Participant
makes a valid waiver election (described in Section 6.05) within
the 90 day period ending on the annuity starting date. If, as of
the annuity starting date, the Participant is married, a
qualified joint and survivor annuity is an immediate annuity
which is purchasable with the Participant's Nonforfeitable
Accrued Benefit and which provides a life annuity for the
Participant and a survivor annuity payable for the remaining life
of the Participant's surviving spouse equal to 50% of the amount
of the annuity payable during the life of the Participant. If, as
of the annuity starting date, the Participant is not married, a
qualified joint and survivor annuity is an immediate life annuity
for the Participant which is purchasable with the Participant's
Nonforfeitable Accrued Benefit. On or before the annuity starting
date, the Advisory Committee, without Participant or spousal
consent, must direct the Trustee to pay the Participant's
Nonforfeitable Accrued Benefit in a lump sum, in lieu of a
qualified joint and survivor annuity, in accordance with Section
6.01, if the Participant's Nonforfeitable Accrued Benefit is not
greater than $3,500. This Section 6.04(A) applies only to a
Participant who has completed at least one Hour of Service with
the Employer after August 22, 1984.
(B) Preretirement Survivor Annuity. If a married Participant dies
prior to his annuity starting date, the Advisory Committee will
direct the Trustee to distribute a portion of the Participant's
Nonforfeitable Accrued Benefit to the Participant's surviving
spouse in the form of a preretirement survivor annuity, unless
the Participant has a valid waiver election (as described in
Section 6.06) in effect, or unless the Participant and his spouse
were not married throughout the one year period ending on the
date of his death. A preretirement survivor annuity is an annuity
which is purchasable with 50% of the Participant's Nonforfeitable
Accrued Benefit (determined as of the date of the Participant's
death) and which is payable for the life of the Participant's
surviving spouse. The value of the preretirement survivor annuity
is attributable to Employer contributions and to Employee
contributions in the same proportion as the Participant's
Nonforfeitable Accrued Benefit is attributable to those
contributions. The portion of the Participant's Nonforfeitable
Accrued Benefit not payable under this paragraph is payable to
the Participant's Beneficiary, in accordance with the other
provisions of this Article VI. If the present value of the
preretirement survivor annuity does not exceed $3,500, the
Advisory Committee, on or before the annuity starting date, must
direct the Trustee to make a lump sum distribution to the
Participant's surviving spouse, in lieu of a preretirement
survivor annuity. This Section 6.04(B) applies only to a
Participant who dies after August 22, 1984, and either (i)
completes at least one Hour of Service with the Employer after
August 22, 1984, or (ii) separated from Service with at least 10
Years of Service (as defined in Section 5.06) and completed at
least one Hour of Service with the Employer in a Plan Year
beginning after December 31, 1975.
(C) Surviving Spouse Elections. If the present value of the
preretirement survivor annuity exceeds $3,500, the Participant's
surviving spouse may elect to have the Trustee commence payment
of the preretirement survivor annuity at any time following the
date of the Participant's death, but not later than the mandatory
distribution periods described in Section 6.02, and may elect any
of the forms of payment described in Section 6.02, in lieu of the
preretirement survivor annuity. In the absence of an election by
the surviving spouse, the Advisory Committee must direct the
Trustee to distribute the preretirement survivor annuity on the
first distribution date following the close of the Plan Year in
which the latest of the following events occurs: (i) the
Participant's death; (ii) the date the Advisory Committee
receives notification of or otherwise confirms the Participant's
death; (iii) the date the Participant would have attained Normal
Retirement Age; or (iv) the date the Participant would have
attained age 62.
(D) Special Rules. If the Participant has in effect a valid
waiver election regarding the qualified joint and survivor
annuity or the preretirement survivor annuity, the Advisory
Committee must direct the Trustee to distribute the Participant's
Nonforfeitable Accrued Benefit in accordance with Sections 6.01,
6.02 and 6.03. The Advisory Committee will reduce the
Participant's Nonforfeitable Accrued Benefit by any security
interest (pursuant to any offset rights authorized by Section
10.03[E]) held by the Plan by reason of a Participant loan to
determine the value of the Participant's Nonforfeitable Accrued
Benefit distributable in the form of a qualified joint and
survivor annuity or preretirement survivor annuity, provided any
post-August 18, 1985, loan satisfied the spousal consent
requirement described in Section 10.03[E] of the Plan. For
purposes of applying this Article VI, the Advisory Committee
treats a former spouse as the Participant's spouse or surviving
spouse to the extent provided under a qualified domestic
relations order described in Section 6.07. The provisions of this
Section 6.04, and of Sections 6.05 and 6.06, apply separately to
the portion of the Participant's Nonforfeitable Accrued Benefit
subject to the qualified domestic relations order and to the
portion of the Participant's Nonforfeitable Accrued Benefit not
subject to that order.
(E) Profit Sharing Plan Election. If this Plan is a profit
sharing plan, the Employer must elect the extent to which the
preceding provisions of Section 6.04 apply. If the Employer
elects to apply this Section 6.04 only to a Participant described
in this Section 6.04(E), the preceding provisions of this Section
6.04 apply only to the following Participants: (1) a Participant
as respects whom the Plan is a direct or indirect transferee from
a plan subject to the Code Sect.417 requirements and the Plan
received the transfer after December 31, 1984, unless the
transfer is an elective transfer described in Section 13.06; (2)
a Participant who elects a life annuity distribution (if Section
6.02 or Section 13.02 of the Plan requires the Plan to provide a
life annuity distribution option); and (3) a Participant whose
benefits under a defined benefit plan maintained by the Employer
are offset by benefits provided under this Plan. If the Employer
elects to apply this Section 6.04 to all Participants, the
preceding provisions of this Section 6.04 apply to all
Participants described in the first two paragraphs of this
Section 6.04, without regard to the limitations of this Section
6.04(E). Sections 6.05 and 6.06 only apply to Participants to
whom the preceding provisions of this Section 6.04 apply.
6.05 WAIVER ELECTION - QUALIFIED JOINT AND SURVIVOR ANNUITY.
Not earlier than 90 days, but not later than 30 days, before the
Participant's annuity starting date, the Advisory Committee must
provide the Participant a written explanation of the terms and
conditions of the qualified joint and survivor annuity, the
Participant's right to make, and the effect of, an election to
waive the joint and survivor form of benefit, the rights of the
Participant's spouse regarding the waiver election and the
Participant's right to make, and the effect of, a revocation of a
waiver election. The Plan does not limit the number of times the
Participant may revoke a waiver of the qualified joint and
survivor annuity or make a new waiver during the election period.
A married Participant's waiver election is not valid unless
(a) the Participant's spouse (to whom the survivor annuity is
payable under the qualified joint and survivor annuity), after
the Participant has received the written explanation described in
this Section 6.05, has consented in writing to the waiver
election, the spouse's consent acknowledges the effect of the
election, and a notary public or the Plan Administrator (or his
representative) witnesses the spouse's consent, (b) the spouse
consents to the alternate form of payment designated by the
Participant or to any change in that designated form of payment,
and (c) unless the spouse is the Participant's sole primary
Beneficiary, the spouse consents to the Participant's Beneficiary
designation or to any change in the Participant's Beneficiary
designation. The spouse's consent to a waiver of the qualified
joint and survivor annuity is irrevocable, unless the Participant
revokes the waiver election. The spouse may execute a blanket
consent to any form of payment designation or to any Beneficiary
designation made by the Participant, if the spouse acknowledges
the right to limit that consent to a specific designation but, in
writing, waives that right. The consent requirements of this
Section 6.05 apply to a former spouse of the Participant, to the
extent required under a qualified domestic relations order
described in Section 6.07.
The Advisory Committee will accept as valid a waiver
election which does not satisfy the spousal consent requirements
if the Advisory Committee establishes the Participant does not
have a spouse, the Advisory Committee is not able to locate the
Participant's spouse, the Participant is legally separated or has
been abandoned (within the meaning of State law) and the
Participant has a court order to that effect, or other
circumstances exist under which the Secretary of the Treasury
will excuse the consent requirement. If the Participant's spouse
is legally incompetent to give consent, the spouse's legal
guardian (even if the guardian is the Participant) may give
consent.
6.06 WAIVER ELECTION - PRERETIREMENT SURVIVOR ANNUITY.
The Advisory Committee must provide a written explanation of the
preretirement survivor annuity to each married Participant,
within the following period which ends last: (1) the period
beginning on the first day of the Plan Year in which the
Participant attains age 32 and ending on the last day of the Plan
Year in which the Participant attains age 34; (2) a reasonable
period after an Employee becomes a Participant; (3) a reasonable
period after the joint and survivor rules become applicable to
the Participant; or (4) a reasonable period after a fully
subsidized preretirement survivor annuity no longer satisfies the
requirements for a fully subsidized benefit. A reasonable period
described in clauses (2), (3) and (4) is the period beginning one
year before and ending one year after the applicable event. If
the Participant separates from Service before attaining age 35,
clauses (1), (2), (3) and (4) do not apply and the Advisory
Committee must provide the written explanation within the period
beginning one year before and ending one year after the
Separation from Service. The written explanation must describe,
in a manner consistent with Treasury regulations, the terms and
conditions of the preretirement survivor annuity comparable to
the explanation of the qualified joint and survivor annuity
required under Section 6.05. The Plan does not limit the number
of times the Participant may revoke a waiver of the preretirement
survivor annuity or make a new waiver during the election period.
A Participant's waiver election of the preretirement
survivor annuity is not valid unless (a) the Participant makes
the waiver election no earlier than the first day of the Plan
Year in which he attains age 35 and (b) the Participant's spouse
(to whom the preretirement survivor annuity is payable) satisfies
the consent requirements described in Section 6.05, except the
spouse need not consent to the form of benefit payable to the
designated Beneficiary. The spouse's consent to the waiver of the
preretirement survivor annuity is irrevocable, unless the
Participant revokes the waiver election. Irrespective of the time
of election requirement described in clause (a), if the
Participant separates from Service prior to the first day of the
Plan Year in which he attains age 35, the Advisory Committee will
accept a waiver election as respects the Participant's Accrued
Benefit attributable to his Service prior to his Separation from
Service. Furthermore, if a Participant who has not separated from
Service makes a valid waiver election, except for the timing
requirement of clause (a), the Advisory Committee will accept
that election as valid, but only until the first day of the Plan
Year in which the Participant attains age 35. A waiver election
described in this paragraph is not valid unless made after the
Participant has received the written explanation described in
this Section 6.06.
6.07 DISTRIBUTIONS UNDER DOMESTIC RELATIONS ORDERS. Nothing
contained in this Plan prevents the Trustee, in accordance with
the direction of the Advisory Committee, from complying with the
provisions of a qualified domestic relations order (as defined in
Code Sect.414(p)). This Plan specifically permits distribution to
an alternate payee under a qualified domestic relations order at
any time, irrespective of whether the Participant has attained
his earliest retirement age (as defined under Code Sect.414(p))
under the Plan. A distribution to an alternate payee prior to the
Participant's attainment of earliest retirement age is available
only if: (1) the order specifies distribution at that time or
permits an agreement between the Plan and the alternate payee to
authorize an earlier distribution; and (2) if the present value
of the alternate payee's benefits under the Plan exceeds $3,500,
and the order requires, the alternate payee consents to any
distribution occurring prior to the Participant's attainment of
earliest retirement age. The Employer, in an addendum to its
Adoption Agreement numbered 6.07, may elect to limit distribution
to an alternate payee only when the Participant has attained his
earliest retirement age under the Plan. Nothing in this Section
6.07 gives a Participant a right to receive distribution at a
time otherwise not permitted under the Plan nor does it permit
the alternate payee to receive a form of payment not otherwise
permitted under the Plan.
The Advisory Committee must establish reasonable procedures
to determine the qualified status of a domestic relations order.
Upon receiving a domestic relations order, the Advisory Committee
promptly will notify the Participant and any alternate payee
named in the order, in writing, of the receipt of the order and
the Plan's procedures for determining the qualified status of the
order. Within a reasonable period of time after receiving the
domestic relations order, the Advisory Committee must determine
the qualified status of the order and must notify the Participant
and each alternate payee, in writing, of its determination. The
Advisory Committee must provide notice under this paragraph by
mailing to the individual's address specified in the domestic
relations order, or in a manner consistent with Department of
Labor regulations.
If any portion of the Participant's Nonforfeitable Accrued
Benefit is payable during the period the Advisory Committee is
making its determination of the qualified status of the domestic
relations order, the Advisory Committee must make a separate
accounting of the amounts payable. If the Advisory Committee
determines the order is a qualified domestic relations order
within 18 months of the date amounts first are payable following
receipt of the order, the Advisory Committee will direct the
Trustee to distribute the payable amounts in accordance with the
order. If the Advisory Committee does not make its determination
of the qualified status of the order within the 18-month
determination period, the Advisory Committee will direct the
Trustee to distribute the payable amounts in the manner the Plan
would distribute if the order did not exist and will apply the
order prospectively if the Advisory Committee later determines
the order is a qualified domestic relations order.
To the extent it is not inconsistent with the provisions of
the qualified domestic relations order, the Advisory Committee
may direct the Trustee to invest any partitioned amount in a
segregated subaccount or separate account and to invest the
account in Federally insured, interest-bearing savings account(s)
or time deposit(s) (or a combination of both), or in other fixed
income investments. A segregated subaccount remains a part of the
Trust, but it alone shares in any income it earns, and it alone
bears any expense or loss it incurs. The Trustee will make any
payments or distributions required under this Section 6.07 by
separate benefit checks or other separate distribution to the
alternate payee(s).
* * * * * * * * * * * * * * *
ARTICLE VII
EMPLOYER ADMINISTRATIVE PROVISIONS
7.01 INFORMATION TO COMMITTEE. The Employer must supply
current information to the Advisory Committee as to the name,
date of birth, date of employment, annual compensation, leaves of
absence, Years of Service and date of termination of employment
of each Employee who is, or who will be eligible to become, a
Participant under the Plan, together with any other information
which the Advisory Committee considers necessary. The Employer's
records as to the current information the Employer furnishes to
the Advisory Committee are conclusive as to all persons.
7.02 NO LIABILITY. The Employer assumes no obligation or
responsibility to any of its Employees, Participants or
Beneficiaries for any act of, or failure to act, on the part of
its Advisory Committee (unless the Employer is the Advisory
Committee), the Trustee, the Custodian, if any, or the Plan
Administrator (unless the Employer is the Plan Administrator).
7.03 INDEMNITY OF CERTAIN FIDUCIARIES. Subject to the
provisions of this Section 7.03, to the full extent permitted by
law, the Employer shall indemnify each past, present and future
Plan Administrator, member of the Advisory Committee and Trustee
(or Custodian) (hereinafter all such indemnified persons and
entities shall be jointly and severally referred to as the
"Indemnified Party") against, and each Indemnified Party shall be
entitled without further act on his part to indemnity from the
Employer for, any and all losses, liabilities, costs and expenses
(including the amount of judgements, court costs, reasonable
attorneys' fees, and the amount of approved settlements made with
a view to the curtailment of costs of litigation, other than
amounts paid to the Employer itself) incurred by such Indemnified
Party in connection with or arising out of any pending,
threatened or anticipated possible action, suit, or other
proceeding, including any investigation that might lead to such a
proceeding, in which he is or may be involved by reason of or in
connection with his being or having been a Plan Administrator,
member of the Advisory Committee, Trustee or Custodian, whether
or not he continues to be a Plan Administrator, member of the
Advisory Committee, Trustee or Custodian at the time of incurring
any such losses, liabilities, costs and expenses (collectively,
the "Losses"); provided, however, that such indemnity shall not
include any losses, liabilities, costs and expenses incurred by
such Indemnified Party (i) with respect to any matters as to
which he is finally adjudged in any such action, suit or
proceeding to have been guilty of gross negligence, bad faith or
intentional misconduct in the performance of his duties as a Plan
Administrator, member of the Advisory Committee, Trustee or
Custodian, or (ii) with respect to any matter to the extent that
a settlement thereof is effected in an amount in excess of the
amount approved by the Employer, which approval shall not be
unreasonably withheld.
The Employer's obligation hereunder to indemnify the
Indemnified Party shall exist without regard to the cause or
causes of the matters for which indemnity is owed and expressly
includes (but is not limited to) the Losses, directly or
indirectly, relating to, based upon, arising out of, or resulting
from any conceivable or possible combination of negligence, fault
or wrong doing, it being the express specific intent of the
Employer to provide the maximum possible indemnification
protection hereunder, but excluding any such Losses that are
found by a court of competent jurisdiction to have resulted
solely from gross negligence, bad faith or intentional
misconduct.
No right of indemnification hereunder shall be available to,
or enforceable by, any such Indemnified Party unless, within
sixty (60) days after his actual receipt of service of process in
any such action, suit or other proceeding (or such longer period
as may be approved by the Employer), he shall have offered the
Employer, in writing, the opportunity to handle and defend same
at its sole expense. The decision by the Employer to handle the
proceeding shall conclusively determine that such Indemnified
Party is entitled to the indemnity provided herein unless then
otherwise expressly agreed by the Indemnified Party. Until and
unless a final judicial determination has been made that
indemnity is not applicable, all such Indemnified Party's
expenses shall be promptly and fully paid or reimbursed by the
Employer upon demand by such person. The foregoing right of
indemnification shall inure to the benefit of the successors and
assigns, and of the heirs, executors, administrators and personal
representatives of each such Indemnified Party and shall be in
additions to all other rights to which such Indemnified Party may
be entitled as a matter of law, contract, or otherwise. The
indemnification provisions of this Section 7.03 shall not relieve
any Indemnified Party from any liability he may have under ERISA
for breach of fiduciary duty. Furthermore, any Indemnified Party
and the Employer may execute a letter agreement further
delineating the indemnification agreement of this Section 7.03,
provided the letter agreement must be consistent with and does
not violate ERISA. Subject to the above provisions of this
Section 7.03, the indemnification provisions of this Section 7.03
extend to each Indemnified Party except to the extent provided by
a letter agreement executed by the Employer and any person who
otherwise would be an Indemnified Party under this Section 7.03.
7.04 EMPLOYER DIRECTION OF INVESTMENT. The Employer has the
right to direct the Trustee with respect to the investment and
re-investment of assets comprising the Trust Fund only if the
Trustee consents in writing to permit such direction. If the
Trustee consents to Employer direction of investment, the Trustee
and the Employer must execute a letter agreement as a part of
this Plan containing such conditions, limitations and other
provisions they deem appropriate before the Trustee will follow
any Employer direction as respects the investment or
re-investment of any part of the Trust Fund.
7.05 AMENDMENT TO VESTING SCHEDULE. Though the Employer
reserves the right to amend the vesting schedule at any time,
the Advisory Committee will not apply the amended vesting
schedule to reduce the Nonforfeitable percentage of any
Participant's Accrued Benefit derived from Employer contributions
(determined as of the later of the date the Employer adopts the
amendment, or the date the amendment becomes effective) to a
percentage less than the Nonforfeitable percentage computed under
the Plan without regard to the amendment. An amended vesting
schedule will apply to a Participant only if the Participant
receives credit for at least one Hour of Service after the new
schedule becomes effective.
If the Employer makes a permissible amendment to the vesting
schedule, each Participant having at least 3 Years of Service
with the Employer may elect to have the percentage of his
Nonforfeitable Accrued Benefit computed under the Plan without
regard to the amendment. For Plan Years beginning prior to
January 1, 1989, the election described in the preceding sentence
applies only to Participants having at least 5 Years of Service
with the Employer. The Participant must file his election with
the Advisory Committee within 60 days of the latest of (a) the
Employer's adoption of the amendment; (b) the effective date of
the amendment; or (c) his receipt of a copy of the amendment. The
Advisory Committee, as soon as practicable, must forward a true
copy of any amendment to the vesting schedule to each affected
Participant, together with an explanation of the effect of the
amendment, the appropriate form upon which the Participant may
make an election to remain under the vesting schedule provided
under the Plan prior to the amendment and notice of the time
within which the Participant must make an election to remain
under the prior vesting schedule. The election described in this
Section 7.05 does not apply to a Participant if the amended
vesting schedule provides for vesting at least as rapid at all
times as the vesting schedule in effect prior to the amendment.
For purposes of this Section 7.05, an amendment to the vesting
schedule includes any Plan amendment which directly or indirectly
affects the computation of the Nonforfeitable percentage of an
Employee's rights to his Employer derived Accrued Benefit.
Furthermore, the Advisory Committee must treat any shift in the
vesting schedule, due to a change in the Plan's top heavy status,
as an amendment to the vesting schedule for purposes of this
Section 7.05.
* * * * * * * * * * * * * * *
ARTICLE VIII
PARTICIPANT ADMINISTRATIVE PROVISIONS
8.01 BENEFICIARY DESIGNATION. Any Participant may from time
to time designate, in writing, any person or persons,
contingently or successively, to whom the Trustee will pay his
Nonforfeitable Accrued Benefit (including any life insurance
proceeds payable to the Participant's Account) in the event of
his death and the Participant may designate the form and method
of payment. The Advisory Committee will prescribe the form for
the written designation of Beneficiary and, upon the
Participant's filing the form with the Advisory Committee, the
form effectively revokes all designations filed prior to that
date by the same Participant.
(A) Coordination with survivor requirements. If the joint and
survivor requirements of Article VI apply to the Participant,
this Section 8.01 does not impose any special spousal consent
requirements on the Participant's Beneficiary designation.
However, in the absence of spousal consent (as required by
Article VI) to the Participant's Beneficiary designation: (1) any
waiver of the joint and survivor annuity or of the preretirement
survivor annuity is not valid; and (2) if the Participant dies
prior to his annuity starting date, the Participant's Beneficiary
designation will apply only to the portion of the death benefit
which is not payable as a preretirement survivor annuity.
Regarding clause (2), if the Participant's surviving spouse is a
primary Beneficiary under the Participant's Beneficiary
designation, the Trustee will satisfy the spouse's interest in
the Participant's death benefit first from the portion which is
payable as a preretirement survivor annuity.
(B) Profit sharing plan exception. If the Plan is a profit
sharing plan, the Beneficiary designation of a married Exempt
Participant is not valid unless the Participant's spouse consents
(in a manner described in Section 6.05) to the Beneficiary
designation. An "Exempt Participant" is a Participant who is not
subject to the joint and survivor requirements of Article VI. The
spousal consent requirement in this paragraph does not apply if
the Exempt Participant and his spouse are not married throughout
the one year period ending on the date of the Participant's
death, or if the Participant's spouse is the Participant's sole
primary Beneficiary.
8.02 NO BENEFICIARY DESIGNATION/DEATH OF BENEFICIARY. If a
Participant fails to name a Beneficiary in accordance with
Section 8.01, or if the Beneficiary named by a Participant
predeceases him, then the Trustee will pay the Participant's
Nonforfeitable Accrued Benefit in accordance with Section 6.02 in
the following order of priority, unless the Employer specifies a
different order of priority in an addendum to its Adoption
Agreement, to:
(a) The Participant's surviving spouse;
(b) The Participant's surviving children, including adopted
children, in equal shares;
(c) The Participant's surviving parents, in equal shares; or
(d) The Participant's estate.
If the Beneficiary does not predecease the Participant, but
dies prior to distribution of the Participant's entire
Nonforfeitable Accrued Benefit, the Trustee will pay the
remaining Nonforfeitable Accrued Benefit to the Beneficiary's
estate unless the Participant's Beneficiary designation provides
otherwise or unless the Employer provides otherwise in its
Adoption Agreement. If the Plan is a profit sharing plan, and the
Plan includes Exempt Participants, the Employer may not specify a
different order of priority in the Adoption Agreement unless the
Participant's surviving spouse will be first in the different
order of priority. The Advisory Committee will direct the Trustee
as to the method and to whom the Trustee will make payment under
this Section 8.02.
8.03 PERSONAL DATA TO COMMITTEE. Each Participant and each
Beneficiary of a deceased Participant must furnish to the
Advisory Committee such evidence, data or information as the
Advisory Committee considers necessary or desirable for the
purpose of administering the Plan. The provisions of this Plan
are effective for the benefit of each Participant upon the
condition precedent that each Participant will furnish promptly
full, true and complete evidence, data and information when
requested by the Advisory Committee, provided the Advisory
Committee advises each Participant of the effect of his failure
to comply with its request.
8.04 ADDRESS FOR NOTIFICATION. Each Participant and each
Beneficiary of a deceased Participant must file with the Advisory
Committee from time to time, in writing, his post office address
and any change of post office address. Any communication,
statement or notice addressed to a Participant, or Beneficiary,
at his last post office address filed with the Advisory
Committee, or as shown on the records of the Employer, binds the
Participant, or Beneficiary, for all purposes of this Plan.
8.05 ASSIGNMENT OR ALIENATION. Subject to Code Sect.414(p)
relating to qualified domestic relations orders, neither a
Participant nor a Beneficiary may anticipate, assign or alienate
(either at law or in equity) any benefit provided under the Plan,
and the Trustee will not recognize any such anticipation,
assignment or alienation. Furthermore, a benefit under the Plan
is not subject to attachment, garnishment, levy, execution or
other legal or equitable process.
8.06 NOTICE OF CHANGE IN TERMS. The Plan Administrator,
within the time prescribed by ERISA and the applicable
regulations, must furnish all Participants and Beneficiaries a
summary description of any material amendment to the Plan or
notice of discontinuance of the Plan and all other information
required by ERISA to be furnished without charge.
8.07 LITIGATION AGAINST THE TRUST. A court of competent
jurisdiction may authorize any appropriate equitable relief to
redress violations of ERISA or to enforce any provisions of ERISA
or the terms of the Plan. A fiduciary may receive reimbursement
of expenses properly and actually incurred in the performance of
his duties with the Plan.
8.08 INFORMATION AVAILABLE. Any Participant in the Plan or
any Beneficiary may examine copies of the Plan description,
latest annual report, any bargaining agreement, this Plan and
Trust, contract or any other instrument under which the Plan was
established or is operated. The Plan Administrator will maintain
all of the items listed in this Section 8.08 in his office, or in
such other place or places as he may designate from time to time
in order to comply with the regulations issued under ERISA, for
examination during reasonable business hours. Upon the written
request of a Participant or Beneficiary the Plan Administrator
must furnish him with a copy of any item listed in this Section
8.08. The Plan Administrator may make a reasonable charge to the
requesting person for the copy so furnished.
8.09 APPEAL PROCEDURE FOR DENIAL OF BENEFITS. A Participant
or a Beneficiary ("Claimant") may file with the Advisory
Committee a written claim for benefits, if the Participant or
Beneficiary determines the distribution procedures of the Plan
have not provided him his proper Nonforfeitable Accrued Benefit.
The Advisory Committee must render a decision on the claim within
60 days of the Claimant's written claim for benefits. The Plan
Administrator must provide adequate notice in writing to the
Claimant whose claim for benefits under the Plan the Advisory
Committee has denied. The Plan Administrator's notice to the
Claimant must set forth:
(a) The specific reason for the denial;
(b) Specific references to pertinent Plan provisions on
which the Advisory Committee based its denial;
(c) A description of any additional material and information
needed for the Claimant to perfect his claim and an
explanation of why the material or information is needed;
and
(d) That any appeal the Claimant wishes to make of the
adverse determination must be in writing to the Advisory
Committee within 75 days after receipt of the Plan
Administrator's notice of denial of benefits. The Plan
Administrator's notice must further advise the Claimant that
his failure to appeal the action to the Advisory Committee
in writing within the 75-day period will render the Advisory
Committee's determination final, binding and conclusive.
If the Claimant should appeal to the Advisory Committee, he,
or his duly authorized representative, may submit, in writing,
whatever issues and comments he, or his duly authorized
representative, feels are pertinent. The Claimant, or his duly
authorized representative, may review pertinent Plan documents.
The Advisory Committee will re-examine all facts related to the
appeal and make a final determination as to whether the denial of
benefits is justified under the circumstances. The Advisory
Committee must advise the Claimant of its decision within 60 days
of the Claimant's written request for review, unless special
circumstances (such as a hearing) would make the rendering of a
decision within the 60-day limit unfeasible, but in no event may
the Advisory Committee render a decision respecting a denial for
a claim for benefits later than 120 days after its receipt of a
request for review.
The Plan Administrator's notice of denial of benefits must
identify the name of each member of the Advisory Committee and
the name and address of the Advisory Committee member to whom the
Claimant may forward his appeal.
8.10 PARTICIPANT DIRECTION OF INVESTMENT. A Participant has
the right to direct the Trustee with respect to the investment or
re-investment of the assets comprising the Participant's
individual Account only if the Trustee consents in writing to
permit such direction. If the Trustee consents to Participant
direction of investment, the Trustee will accept direction from
each Participant on a written election form (or other written
agreement), as a part of this Plan, containing such conditions,
limitations and other provisions the parties deem appropriate.
The Trustee or, with the Trustee's consent, the Advisory
Committee, may establish written procedures, incorporated
specifically as part of this Plan, relating to Participant
direction of investment under this Section 8.10. The Trustee will
maintain a segregated investment Account to the extent a
Participant's Account is subject to Participant self-direction.
The Trustee is not liable for any loss, nor is the Trustee liable
for any breach, resulting from a Participant's direction of the
investment of any part of his directed Account.
The Advisory Committee, to the extent provided in a written
loan policy adopted under Section 9.04, will treat a loan made to
a Participant as a Participant direction of investment under this
Section 8.10. To the extent of the loan outstanding at any time,
the borrowing Participant's Account alone shares in any interest
paid on the loan, and it alone bears any expense or loss it
incurs in connection with the loan. The Trustee may retain any
principal or interest paid on the borrowing Participant's loan in
an interest bearing segregated Account on behalf of the borrowing
Participant until the Trustee (or the Named Fiduciary, in the
case of a nondiscretionary Trustee) deems it appropriate to add
the amount paid to the Participant's separate Account under the
Plan.
If the Trustee consents to Participant direction of
investment of his Account, the Plan treats any post-December 31,
1981, investment by a Participant's directed Account in
collectibles (as defined by Code Sect.408(m)) as a deemed
distribution to the Participant for Federal income tax purposes.
* * * * * * * * * * * * * * *
ARTICLE IX
ADVISORY COMMITTEE - DUTIES WITH RESPECT TO PARTICIPANTS'
ACCOUNTS
9.01 MEMBERS' COMPENSATION, EXPENSES. The Employer must
appoint an Advisory Committee to administer the Plan, the members
of which may or may not be Participants in the Plan, or which may
be the Plan Administrator acting alone. In the absence of an
Advisory Committee appointment, the Plan Administrator assumes
the powers, duties and responsibilities of the Advisory
Committee. The members of the Advisory Committee will serve
without compensation for services as such, but the Employer will
pay all expenses of the Advisory Committee, except to the extent
the Trust properly pays for such expenses, pursuant to Article X.
9.02 TERM. Each member of the Advisory Committee serves
until the appointment of his successor.
9.03 POWERS. In case of a vacancy in the membership of the
Advisory Committee, the remaining members of the Advisory
Committee may exercise any and all of the powers, authority,
duties and discretion conferred upon the Advisory Committee
pending the filling of the vacancy.
9.04 GENERAL. The Advisory Committee has the following
powers and duties:
(a) To select a Secretary, who need not be a member of the
Advisory Committee;
(b) To determine the rights of eligibility of an Employee
to participate in the Plan, the value of a Participant's
Accrued Benefit and the Nonforfeitable percentage of each
Participant's Accrued Benefit;
(c) To adopt rules of procedure and regulations necessary
for the proper and efficient administration of the Plan
provided the rules are not inconsistent with the terms of
this Agreement;
(d) To construe and enforce the terms of the Plan and the
rules and regulations it adopts, including interpretation of
the Plan documents and documents related to the Plan's
operation;
(e) To direct the Trustee as respects the crediting and
distribution of the Trust;
(f) To review and render decisions respecting a claim for
(or denial of a claim for) a benefit under the Plan;
(g) To furnish the Employer with information which the
Employer may require for tax or other purposes;
(h) To engage the service of agents whom it may deem
advisable to assist it with the performance of its duties;
(i) To engage the services of an Investment Manager or
Managers (as defined in ERISA Sect.3(38)), each of whom will
have full power and authority to manage, acquire or dispose
(or direct the Trustee with respect to acquisition or
disposition) of any Plan asset under its control;
(j) To establish, in its sole discretion, a
nondiscriminatory policy (see Section 9.04(A)) which the
Trustee must observe in making loans, if any, to
Participants and Beneficiaries; and
(k) To establish and maintain a funding standard account
and to make credits and charges to the account to the extent
required by and in accordance with the provisions of the
Code.
The Advisory Committee must exercise all of its powers,
duties and discretion under the Plan in a uniform and
nondiscriminatory manner.
(A) Loan Policy. If the Advisory Committee adopts a loan policy,
pursuant to paragraph (j), the loan policy must be a written
document and must include: (1) the identity of the person or
positions authorized to administer the participant loan program;
(2) a procedure for applying for the loan; (3) the criteria for
approving or denying a loan; (4) the limitations, if any, on the
types and amounts of loans available; (5) the procedure for
determining a reasonable rate of interest; (6) the types of
collateral which may secure the loan; and (7) the events
constituting default and the steps the Plan will take to preserve
plan assets in the event of default. This Section 9.04
specifically incorporates a written loan policy as part of the
Employer's Plan.
9.05 FUNDING POLICY. The Advisory Committee will review, not
less often than annually, all pertinent Employee information and
Plan data in order to establish the funding policy of the Plan
and to determine the appropriate methods of carrying out the
Plan's objectives. The Advisory Committee must communicate
periodically, as it deems appropriate, to the Trustee and to any
Plan Investment Manager the Plan's short-term and long-term
financial needs so investment policy can be coordinated with Plan
financial requirements.
9.06 MANNER OF ACTION. The decision of a majority of the
members appointed and qualified controls.
9.07 AUTHORIZED REPRESENTATIVE. The Advisory Committee
may authorize any one of its members, or its Secretary, to
sign on its behalf any notices, directions, applications,
certificates, consents, approvals, waivers, letters or other
documents. The Advisory Committee must evidence this authority by
an instrument signed by all members and filed with the Trustee.
9.08 INTERESTED MEMBER. No member of the Advisory
Committee may decide or determine any matter concerning the
distribution, nature or method of settlement of his own benefits
under the Plan, except in exercising an election available to
that member in his capacity as a Participant, unless the Plan
Administrator is acting alone in the capacity of the Advisory
Committee.
9.09 INDIVIDUAL ACCOUNTS. The Advisory Committee will
maintain, or direct the Trustee to maintain, a separate Account,
or multiple Accounts, in the name of each Participant to reflect
the Participant's Accrued Benefit under the Plan. If a
Participant re-enters the Plan subsequent to his having a
Forfeiture Break in Service, the Advisory Committee, or the
Trustee, must maintain a separate Account for the Participant's
pre-Forfeiture Break in Service Accrued Benefit and a separate
Account for his post-Forfeiture Break in Service Accrued Benefit,
unless the Participant's entire Accrued Benefit under the Plan is
100% Nonforfeitable.
The Advisory Committee will make its allocations, or request
the Trustee to make its allocations, to the Accounts of the
Participants in accordance with the provisions of Section 9.11.
The Advisory Committee may direct the Trustee to maintain a
temporary segregated investment Account in the name of a
Participant to prevent a distortion of income, gain or loss
allocations under Section 9.11. The Advisory Committee must
maintain records of its activities.
9.10 VALUE OF PARTICIPANT'S ACCRUED BENEFIT. The value of
each Participant's Accrued Benefit consists of that proportion
of the net worth (at fair market value) of the Employer's Trust
Fund which the net credit balance in his Account (exclusive of
the cash value of incidental benefit insurance contracts) bears
to the total net credit balance in the Accounts (exclusive of the
cash value of the incidental benefit insurance contracts) of all
Participants plus the cash surrender value of any incidental
benefit insurance contracts held by the Trustee on the
Participant's life.
For purposes of a distribution under the Plan, the value of
a Participant's Accrued Benefit is its value as of the valuation
date immediately preceding the date of the distribution. Any
distribution (other than a distribution from a segregated
Account) made to a Participant (or to his Beneficiary) more than
90 days after the most recent valuation date may include interest
on the amount of the distribution as an expense of the Trust
Fund. The interest, if any, accrues from such valuation date to
the date of the distribution at the rate established in the
Employer's Adoption Agreement.
9.11 ALLOCATION AND DISTRIBUTION OF NET INCOME GAIN OR LOSS.
A "valuation date" under this Plan is each Accounting Date and
each interim valuation date determined under Section 10.14. As of
each valuation date the Advisory Committee must adjust Accounts
to reflect net income, gain or loss since the last valuation
date. The valuation period is the period beginning the day after
the last valuation date and ending on the current valuation date.
(A) Trust Fund Accounts. The allocation provisions of this
paragraph apply to all Participant Accounts other than segregated
investment Accounts. The Advisory Committee first will adjust the
Participant Accounts, as those Accounts stood at the beginning of
the current valuation period, by reducing the Accounts for any
forfeitures arising under Section 5.09 or under Section 9.14, for
amounts charged during the valuation period to the Accounts in
accordance with Section 9.13 (relating to distributions) and
Section 11.01 (relating to insurance premiums), and for the cash
value of incidental benefit insurance contracts. The Advisory
Committee then, subject to the restoration allocation
requirements of Section 5.04 or of Section 9.14, will allocate
the net income, gain or loss pro rata to the adjusted Participant
Accounts. The allocable net income, gain or loss is the net
income (or net loss), including the increase or decrease in the
fair market value of assets, since the last valuation date.
(B) Segregated investment Accounts. A segregated investment
Account receives all income it earns and bears all expense or
loss it incurs. The Advisory Committee will adopt uniform and
nondiscriminatory procedures for determining income or loss of a
segregated investment Account in a manner which reasonably
reflects investment directions relating to pooled investments and
investment directions occurring during a valuation period. As of
the valuation date, the Advisory Committee must reduce a
segregated Account for any forfeiture arising under Section 5.09
after the Advisory Committee has made all other allocations,
changes or adjustments to the Account for the Plan Year.
(C) Additional rules. An Excess Amount or suspense account
described in Part 2 of Article III does not share in the
allocation of net income, gain or loss described in this Section
9.11. If the Employer maintains its Plan under a Code Sect.401(k)
Adoption Agreement, the Employer may specify in its Adoption
Agreement alternate valuation provisions authorized by that
Adoption Agreement. This Section 9.11 applies solely to the
allocation of net income, gain or loss of the Trust. The Advisory
Committee will allocate the Employer contributions and
Participant forfeitures, if any, in accordance with Article III.
9.12 INDIVIDUAL STATEMENT. As soon as practicable after the
Accounting Date of each Plan Year, but within the time
prescribed by ERISA and the regulations under ERISA, the Plan
Administrator will deliver to each Participant (and to each
Beneficiary) a statement reflecting the condition of his Accrued
Benefit in the Trust as of that date and such other information
ERISA requires be furnished the Participant or Beneficiary. No
Participant, except a member of the Advisory Committee, has the
right to inspect the records reflecting the Account of any other
Participant.
9.13 ACCOUNT CHARGED. The Advisory Committee will charge a
Participant's Account for all distributions made from that
Account to the Participant, to his Beneficiary or to an alternate
payee. The Advisory Committee also will charge a Participant's
Account for any administrative expenses incurred by the Plan
directly related to that Account.
9.14 UNCLAIMED ACCOUNT PROCEDURE. The Plan does not
require either the Trustee or the Advisory Committee to search
for, or to ascertain the whereabouts of, any Participant or
Beneficiary. At the time the Participant's or Beneficiary's
benefit becomes distributable under Article VI, the Advisory
Committee, by certified or registered mail addressed to his last
known address of record with the Advisory Committee or the
Employer, must notify any Participant, or Beneficiary, that he is
entitled to a distribution under this Plan. The notice must quote
the provisions of this Section 9.14 and otherwise must comply
with the notice requirements of Article VI. If the Participant,
or Beneficiary, fails to claim his distributive share or make his
whereabouts known in writing to the Advisory Committee within 6
months from the date of mailing of the notice, the Advisory
Committee will treat the Participant's or Beneficiary's unclaimed
payable Accrued Benefit as forfeited and will reallocate the
unclaimed payable Accrued Benefit in accordance with Section
3.05. A forfeiture under this paragraph will occur at the end of
the notice period or, if later, the earliest date applicable
Treasury regulations would permit the forfeiture. Pending
forfeiture, the Advisory Committee, following the expiration of
the notice period, may direct the Trustee to segregate the
Nonforfeitable Accrued Benefit in a segregated Account and to
invest that segregated Account in Federally insured interest
bearing savings accounts or time deposits (or in a combination of
both), or in other fixed income investments.
If a Participant or Beneficiary who has incurred a
forfeiture of his Accrued Benefit under the provisions of the
first paragraph of this Section 9.14 makes a claim, at any time,
for his forfeited Accrued Benefit, the Advisory Committee must
restore the Participant's or Beneficiary's forfeited Accrued
Benefit to the same dollar amount as the dollar amount of the
Accrued Benefit forfeited, unadjusted for any gains or losses
occurring subsequent to the date of the forfeiture. The Advisory
Committee will make the restoration during the Plan Year in which
the Participant or Beneficiary makes the claim, first from the
amount, if any, of Participant forfeitures the Advisory Committee
otherwise would allocate for the Plan Year, then from the amount,
if any, of the Trust Fund net income or gain for the Plan Year
and then from the amount, or additional amount, the Employer
contributes to enable the Advisory Committee to make the required
restoration. The Advisory Committee must direct the Trustee to
distribute the Participant's or Beneficiary's restored Accrued
Benefit to him not later than 60 days after the close of the Plan
Year in which the Advisory Committee restores the forfeited
Accrued Benefit. The forfeiture provisions of this Section 9.14
apply solely to the Participant's or to the Beneficiary's Accrued
Benefit derived from Employer contributions.
* * * * * * * * * * * * * * *
ARTICLE X
CUSTODIAN/TRUSTEE, POWERS AND DUTIES
10.01 ACCEPTANCE. The Trustee accepts the Trust created
under the Plan and agrees to perform the obligations imposed. The
Trustee must provide bond for the faithful performance of its
duties under the Trust to the extent required by ERISA.
10.02 RECEIPT OF CONTRIBUTIONS. The Trustee is
accountable to the Employer for the funds contributed to it by
the Employer, but does not have any duty to see that the
contributions received comply with the provisions of the Plan.
The Trustee is not obliged to collect any contributions from the
Employer, nor is obliged to see that funds deposited with it are
deposited according to the provisions of the Plan.
10.03 INVESTMENT POWERS.
[A] Discretionary Trustee Designation. If the Employer, in
Adoption Agreement Section 1.02, designates the Trustee to
administer the Trust as a discretionary Trustee, then the Trustee
has full discretion and authority with regard to the investment
of the Trust Fund, except with respect to a Plan asset under the
control or direction of a properly appointed Investment Manager
or with respect to a Plan asset properly subject to Employer,
Participant or Advisory Committee direction of investment. The
Trustee must coordinate its investment policy with Plan financial
needs as communicated to it by the Advisory Committee. The
Trustee is authorized and empowered, but not by way of
limitation, with the following powers, rights and duties:
(a) To invest any part or all of the Trust Fund in any
common or preferred stocks, open-end or closed-end mutual
funds (including mutual funds established and maintained as
collective investment funds for trust accounts by the
Trustee or its affiliate), put and call options traded on a
national exchange, United States retirement plan bonds,
corporate bonds, debentures, convertible debentures,
commercial paper, U.S. Treasury Bills, U.S. Treasury notes
and other direct or indirect obligations of the United
States Government or its agencies, improved or unimproved
real estate situated in the United States, limited
partnerships, insurance contracts of any type, mortgages,
notes, including but not limited to master notes, or other
property of any kind, real or personal or mixed, whether
tangible or intangible or productive of income, to buy or
sell options on common stock on a nationally recognized
exchange with or without holding the underlying common
stock, to buy and sell commodities, commodity options and
contracts for the future delivery of commodities, and to
make any other investments the Trustee deems appropriate, as
a prudent man would do under like circumstances with due
regard for the purposes of this Plan. Any investment made
or retained by the Trustee in good faith is proper but must
be of a kind constituting a diversification considered by
law suitable for trust investments.
(b) To retain in cash so much of the Trust Fund as it may
deem advisable to satisfy the liquidity needs of the Plan
and to deposit any cash held in the Trust fund in a bank
account at reasonable interest and to hold uninvested at any
time, without liability for interest thereon for a
reasonable period of time, any amount of money received by
the Trustee or raised by the Trustee from the sale of
investments or otherwise until same can be reinvested or
disbursed.
(c) To invest, if the Trustee is a bank or similar
financial institution supervised by the United States or by
a State, in any type of deposit of the Trustee (or of a bank
related to the Trustee within the meaning of Code
Sect.414(b)) at a reasonable rate of interest or in a common
trust fund, as described in Code Sect.584, or in a
collective investment fund, the provisions of which govern
the investment of such assets and which the Plan
incorporates by this reference, which the Trustee (or its
affiliate, as defined in Code Sect.1504) maintains
exclusively for the collective investment of money
contributed by the bank (or the affiliate) in its capacity
as trustee and which conforms to the rules of the
Comptroller of the Currency.
(d) To manage, sell, contract to sell, grant options to
purchase, convey, exchange, transfer, abandon, improve,
repair, insure, lease for any term even though commencing in
the future or extending beyond the term of the Trust, and
otherwise deal with all property, real or personal, in such
manner, for such considerations and on such terms and
conditions as the Trustee decides.
(e) To credit and distribute the Trust as directed by the
Advisory Committee. The Trustee is not obliged to inquire as
to whether any payee or distributee is entitled to any
payment or whether the distribution is proper or within the
terms of the Plan, or as to the manner of making any payment
or distribution. The Trustee is accountable only to the
Advisory Committee for any payment or distribution made by
it in good faith on the order or direction of the Advisory
Committee.
(f) To borrow money, to assume indebtedness, extend
mortgages and encumber by mortgage or pledge.
(g) To compromise, contest, arbitrate or abandon claims and
demands, in its discretion.
(h) To have with respect to the Trust all of the rights of
an individual owner, including the power to give proxies, to
participate in any voting trusts, mergers, consolidations or
liquidations, and to exercise or sell stock subscriptions or
conversion rights.
(i) To lease for oil, gas and other mineral purposes and to
create mineral severances by grant or reservation; to pool
or unitize interests in oil, gas and other minerals; and to
enter into operating agreements and to execute division and
transfer orders.
(j) To hold any securities or other property in the name of
the Trustee or its nominee, with depositories or agent
depositories, in Federal Reserve Book-Entry or bearer form
or in another form as it may deem best without disclosing
the relationship.
(k) To perform any and all other acts in its judgment
necessary or appropriate for the proper and advantageous
management, investment and distribution of the Trust.
(l) To retain any funds or property subject to any dispute
without liability for the payment of interest, and to
decline to make payment or delivery of the funds or property
until final adjudication is made by a court of competent
jurisdiction.
(m) To file all tax returns required of the Trustee.
(n) Nothing herein contained shall impair the right of the
Trustee to a judicial settlement, in any state or federal
court of competent jurisdiction, of any account including
the final accounting, rendered by the Trustee.
(o) To begin, maintain or defend any litigation necessary
in connection with the administration of the Plan, except
that the Trustee is not obliged or required to do so unless
indemnified to its satisfaction.
(p) To invest any of the funds of the Trust into the
Retirement Investment Trust, or any other open-end,
diversified, management investment company that is specified
in an addendum to the Employer's Adoption Agreement and that
offers collective investment funds for retirement accounts
as to which Texas Commerce Bank National Association or any
affiliated bank serves as a trustee.
(q) To exercise all the rights, powers, options and
privileges now or hereafter granted to trustees under
applicable state law (as defined in Section 12.07), except
such as conflict with the terms of the Plan or ERISA. The
Trustee shall have, hold, manage, control, use, invest and
reinvest, disburse and dispose of the Trust Fund as if the
Trustee were the owner thereof in fee simple instead of in
trust, subject only to such limitations as are required
under applicable state law (as defined in Section 12.07)
that cannot be waived, and subject to ERISA.
[B] Nondiscretionary Trustee Designation/Appointment of
Custodian. If the Employer, in its Adoption Agreement Section
1.02, designates the Trustee to administer the Trust as a
nondiscretionary Trustee, then the Trustee will not have any
discretion or authority with regard to the investment of the
Trust Fund, but must act solely as a directed trustee of the
funds contributed to it. A nondiscretionary Trustee, as directed
trustee of the funds held by it under the Employer's Plan, is
authorized and empowered, by way of limitation, with the
following powers, rights and duties, each of which the
nondiscretionary Trustee exercises solely as directed trustee in
accordance with the written direction of the Named Fiduciary
(except to the extent a Plan asset is subject to the control and
management of a properly appointed Investment Manager or subject
to Advisory Committee or Participant direction of investment):
(a) To invest any part or all of the Trust Fund in any
common or preferred stocks, open-end or closed-end mutual
funds (including mutual funds established and maintained as
collective investment funds for trust accounts by the
Trustee or its affiliate), put and call options traded on a
national exchange, United States retirement plan bonds,
corporate bonds, debentures, convertible debentures,
commercial paper, U.S. Treasury Bills, U.S. Treasury notes
and other direct or indirect obligations of the United
States Government or its agencies, improved or unimproved
real estate situated in the United States, limited
partnerships, insurance contracts of any type, mortgages,
notes, including or not limited to master notes, or other
property of any kind, real or personal or mixed, whether
tangible or intangible or productive of income, to buy or
sell options on common stock on a nationally recognized
exchange with or without holding the underlying common
stock, to buy and sell commodities, commodity options and
contracts for the future delivery of commodities, and to
make any other investments the Named Fiduciary deems
appropriate.
(b) To retain in cash so much of the Trust Fund as the Named
Fiduciary may direct in writing to satisfy liquidity needs
of the Plan and to deposit any cash held in the Trust Fund
in a bank account at reasonable interest, including,
specific authority to invest in any type of deposit of the
Trustee (or of a bank related to the Trustee within the
meaning of Code Section 414(b) at reasonable interest and to
hold uninvested at any time as directed by the Named
Fiduciary, without liability for interest thereon for a
reasonable period of time, any amount of money received by
the Trustee or raised by the Trustee from the sale of
investments or otherwise until same can be reinvested or
disbursed.
(c) To sell, contract to sell, grant options to purchase,
convey, exchange, transfer, abandon, improve, repair,
insure, lease for any term even though commencing in the
future or extending beyond the term of the Trust, and
otherwise deal with all property, real or personal, in such
manner, for such considerations and on such terms and
conditions as the Named Fiduciary directs in writing.
(d) To credit and distribute the Trust as directed by the
Advisory Committee. The Trustee is not obliged to inquire as
to whether any payee or distributee is entitled to any
payment or whether the distribution is proper or within the
terms of the Plan, or as to the manner of making any payment
or distribution. The Trustee is accountable only to the
Advisory Committee for any payment or distribution made by
it in good faith on the order or direction of the Advisory
Committee.
(e) To borrow money, to assume indebtedness, extend
mortgages and encumber by mortgage or pledge.
(f) To have with respect to the Trust all of the rights of
an individual owner, including the power to give proxies, to
participate in any voting trusts, mergers, consolidations or
liquidations, and to exercise or sell stock subscriptions or
conversion rights, provided the exercise of any such powers
is in accordance with and at the written direction of the
Named Fiduciary.
(g) To lease for oil, gas and other mineral purposes and to
create mineral severances by grant or reservation; to pool
or unitize interests in oil, gas and other minerals; and to
enter into operating agreements and to execute division and
transfer orders, provided the exercise of any such powers is
in accordance with and at the written direction of the Named
Fiduciary.
(h) To hold any securities or other property in the name of
the nondiscretionary Trustee or its nominee, with
depositories or agent depositories, in Federal Reserve Book-
Entry or bearer form or in another form as the Named
Fiduciary may deem best, with or without disclosing the
custodial relationship.
(i) To retain any funds or property subject to any dispute
without liability for the payment of interest, and to
decline to make payment or delivery of the funds or property
until a court of competent jurisdiction makes final
adjudication.
(j) To file all tax returns required of the Trustee.
(k) Nothing herein contained shall impair the right of the
nondiscretionary Trustee to a judicial settlement, in any
state or federal court of competent jurisdiction, of any
account including the final accounting, rendered by the
nondiscretionary Trustee.
(l) To begin, maintain or defend any litigation necessary in
connection with the administration of the Plan, except that
the Trustee is not obliged or required to do so unless
indemnified to its satisfaction.
(m) To exercise all the rights, powers, options and
privileges now or hereafter granted to trustees under
applicable state law (as defined in Section 12.07), except
such as conflict with the terms of the Plan or ERISA. The
Trustee shall have, hold, manage, control, use, invest and
reinvest, disburse and dispose of the Trust Fund as if the
Trustee were the owner thereof in fee simple instead of in
trust, subject only to such limitations as are required
under applicable state law (as defined in Section 12.07)
that cannot be waived, and subject to ERISA.
(n) To invest any of the funds of the Trust into the
Retirement Investment Trust, or any other open-end,
diversified, management investment company that is specified
in an addendum to the Employer's Adoption Agreement and that
offers collective investment funds for retirement accounts
as to which Texas Commerce Bank National Association or any
affiliated bank serves as a trustee.
Appointment of Custodian. The Employer may appoint a
Custodian under the Plan, the acceptance by the Custodian
indicated on the execution page of the Employer's Adoption
Agreement. If the Employer appoints a Custodian, the Employer's
Plan must have a discretionary Trustee, as described in Section
10.03[A]. A Custodian has the same powers, rights and duties as a
nondiscretionary Trustee, as described in this Section 10.03[B].
The Custodian accepts the terms of the Plan and Trust by
executing the Employer's Adoption Agreement. Any reference in the
Plan to a Trustee also is a reference to a Custodian where the
context of the Plan dictates. A limitation of the Trustee's
liability by Plan provision also acts as a limitation of the
Custodian's liability. Any action taken by the Custodian at the
discretionary Trustee's direction satisfies any provision in the
Plan referring to the Trustee's taking that action.
Modification of Powers/Limited Responsibility. The Employer
and the Custodian or nondiscretionary Trustee, by letter
agreement, may limit the powers of the Custodian or
nondiscretionary Trustee to any combination of powers listed
within this Section 10.03[B]. If there is a Custodian or a
nondiscretionary Trustee under the Employer's Plan, then the
Employer, in adopting this Plan acknowledges the Custodian or
nondiscretionary Trustee has no discretion with respect to the
investment or re-investment of the Trust Fund and that the
Custodian or nondiscretionary Trustee is acting solely as
custodian or as directed trustee with respect to the assets
comprising the Trust Fund.
[C] Limitation of Powers of Certain Custodians. If a Custodian is
a bank which, under its governing state law, does not possess
trust powers, then paragraphs (a), (c), (e), (f), (g) of Section
10.03[B], Section 10.16 and Article XI do not apply to that bank
and that bank only has the power and authority to exercise the
remaining powers, rights and duties under Section 10.03[B].
[D] Named Fiduciary/Limitation of Liability of Nondiscretionary
Trustee or Custodian. Under a nondiscretionary Trustee
designation, the Named Fiduciary under the Employer's Plan has
the sole responsibility for the management and control of the
Employer's Trust Fund, except with respect to a Plan asset under
the control or direction of a properly appointed Investment
Manager or with respect to a Plan asset properly subject to
Participant or Advisory Committee direction of investment. If the
Employer appoints a Custodian, the Named Fiduciary is the
discretionary Trustee. Under a nondiscretionary Trustee
designation, unless the Employer designates in writing another
person or persons to serve as Named Fiduciary, the Named
Fiduciary under the Plan is the president of a corporate
Employer, the managing partner of a partnership Employer or the
sole proprietor, as appropriate. The Named Fiduciary will
exercise its management and control of the Trust Fund through its
written direction to the nondiscretionary Trustee or to the
Custodian, whichever applies to the Employer's Plan.
The nondiscretionary Trustee or Custodian has no duty to
review or to make recommendations regarding investments made at
the written direction of the Named Fiduciary. The
nondiscretionary Trustee or Custodian must retain any investment
obtained at the written direction of the Named Fiduciary until
further directed in writing by the Named Fiduciary to dispose of
such investment. The nondiscretionary Trustee or Custodian is not
liable in any manner or for any reason for making, retaining or
disposing of any investment pursuant to any written direction
described in this paragraph. Furthermore, the Employer agrees to
indemnify and to hold the nondiscretionary Trustee or Custodian
harmless from any damages, costs or expenses, including
reasonable counsel fees, which the nondiscretionary Trustee or
Custodian may incur as a result of any claim asserted against the
nondiscretionary Trustee, the Custodian or the Trust arising out
of the nondiscretionary Trustee's or Custodian's compliance with
any written direction described in this paragraph.
[E] Participant Loans. This Section 10.03[E] specifically
authorizes the Trustee to make loans on a nondiscriminatory basis
to a Participant or to a Beneficiary in accordance with the loan
policy established by the Advisory Committee, provided: (1) the
loan policy satisfies the requirements of Section 9.04; (2) loans
are available to all Participants and Beneficiaries on a
reasonably equivalent basis and are not available in a greater
amount for Highly Compensated Employees than for other Employees;
(3) any loan is adequately secured and bears a reasonable rate of
interest; (4) the loan provides for repayment within a specified
time; (5) the default provisions of the note prohibit offset of
the Participant's Nonforfeitable Accrued Benefit prior to the
time the Trustee otherwise would distribute the Participant's
Nonforfeitable Accrued Benefit; (6) the amount of the loan does
not exceed (at the time the Plan extends the loan) the present
value of the Participant's Nonforfeitable Accrued Benefit; and
(7) the loan otherwise conforms to the exemption provided by Code
Sect.4975(d)(1). If the joint and survivor requirements of
Article VI apply to the Participant, the Participant may not
pledge any portion of his Accrued Benefit as security for a loan
made after August 18, 1985, unless, within the 90 day period
ending on the date the pledge becomes effective, the
Participant's spouse, if any, consents (in a manner described in
Section 6.05 other than the requirement relating to the consent
of a subsequent spouse) to the security or, by separate consent,
to an increase in the amount of security. If the Employer is an
unincorporated trade or business, a Participant who is an Owner-
Employee may not receive a loan from the Plan, unless he has
obtained a prohibited transaction exemption from the Department
of Labor. If the Employer is an "S Corporation," a Participant
who is a shareholder-employee (an employee or an officer) who, at
any time during the Employer's taxable year, owns more than 5%,
either directly or by attribution under Code Sect.318(a)(1), of
the Employer's outstanding stock may not receive a loan from the
Plan, unless he has obtained a prohibited transaction exemption
from the Department of Labor. If the Employer is not an
unincorporated trade or business nor an "S Corporation," this
Section 10.03[E] does not impose any restrictions on the class of
Participants eligible for a loan from the Plan.
[F] Investment in qualifying Employer securities and qualifying
Employer real property. The investment options in this Section
10.03[F] include the ability to invest in qualifying Employer
securities or qualifying Employer real property, as defined in
and as limited by ERISA. If the Employer's Plan is a
Nonstandardized profit sharing plan, it may elect in its Adoption
Agreement to permit the aggregate investments in qualifying
Employer securities and in qualifying Employer real property to
exceed 10% of the value of Plan assets. Unless the qualifying
Employer Securities are readily traded on an established
securities market, the Named Fiduciary shall obtain from an
"independent appraiser," within the meaning of Section
401(a)(28)(C) of the Code, an annual appraisal of such qualified
Employer Securities with respect to activities carried on by the
Plan. A copy of such independent appraisal shall be attached to
this Agreement each year.
10.04 RECORDS AND STATEMENTS. The records of the
Trustee pertaining to the Plan must be open to the inspection of
the Plan Administrator, the Advisory Committee and the Employer
at all reasonable times and may be audited from time to time by
any person or persons as the Employer, Plan Administrator or
Advisory Committee may specify in writing. The Trustee must
furnish the Plan Administrator or Advisory Committee with
whatever information relating to the Trust Fund the Plan
Administrator or Advisory Committee considers necessary.
10.05 FEES AND EXPENSES FROM FUND. A Trustee or
Custodian will receive reasonable annual compensation as may be
agreed upon from time to time between the Employer and the
Trustee or Custodian. No person who is receiving full pay from
the Employer may receive compensation for services as Trustee or
as Custodian. The Trustee will pay from the Trust Fund all fees
and expenses reasonably incurred by the Plan, to the extent such
fees and expenses are for the ordinary and necessary
administration and operation of the Plan, unless the Employer
pays such fees and expenses. Any fee or expense paid, directly or
indirectly, by the Employer is not an Employer contribution to
the Plan, provided the fee or expense relates to the ordinary and
necessary administration of the Fund. If all or a portion of the
Trust is invested by the Trustee in the Retirement Investment
Trust, then funds from the Trust that are so invested shall be
subject to the compensation and expenses that are set forth in
the then-effective Prospectus of the Retirement Investment Trust,
which will be provided to the Employer when funds from the Trust
are so invested. The provisions of this Section 10.05 shall
equally apply to any other open-end, diversified management
company described in Section 10.03[A](p).
10.06 PARTIES TO LITIGATION. Except as otherwise
provided by ERISA, no Participant or Beneficiary is a necessary
party or is required to receive notice of process in any court
proceeding involving the Plan, the Trust Fund or any fiduciary of
the Plan. Any final judgment entered in any proceeding will be
conclusive upon the Employer, the Plan Administrator, the
Advisory Committee, the Trustee, Custodian, Participants and
Beneficiaries.
10.07 PROFESSIONAL AGENTS. The Trustee may employ and
pay from the Trust Fund reasonable compensation to agents,
attorneys, accountants and other persons to advise the Trustee as
in its opinion may be necessary. The Trustee may delegate to any
agent, attorney, accountant or other person selected by it any
non-Trustee power or duty vested in it by the Plan, and the
Trustee may act or refrain from acting on the advice or opinion
of any agent, attorney, accountant or other person so selected.
10.08 DISTRIBUTION OF CASH OR PROPERTY. The Trustee may
make distribution under the Plan in cash or property, or partly
in each, at its fair market value as determined by the Trustee.
For purposes of a distribution to a Participant or to a
Participant's designated Beneficiary or surviving spouse,
"property" includes a Nontransferable Annuity Contract, provided
the contract satisfies the requirements of this Plan.
10.09 DISTRIBUTION DIRECTIONS. If no one claims a
payment or distribution made from the Trust, the Trustee must
promptly notify the Advisory Committee and then dispose of the
payment in accordance with the subsequent direction of the
Advisory Committee.
10.10 THIRD PARTY/MULTIPLE TRUSTEES. No person dealing
with the Trustee is obligated to see to the proper application of
any money paid or property delivered to the Trustee, or to
inquire whether the Trustee has acted pursuant to any of the
terms of the Plan. Each person dealing with the Trustee may act
upon any notice, request or representation in writing by the
Trustee, or by the Trustee's duly authorized agent, and is not
liable to any person in so acting. The certificate of the Trustee
that it is acting in accordance with the Plan will be conclusive
in favor of any person relying on the certificate. If more than
two persons act as Trustee, a decision of the majority of such
persons controls with respect to any decision regarding the
administration or investment of the Trust Fund or of any portion
of the Trust Fund with respect to which such persons act as
Trustee. However, the signature of only one Trustee is necessary
to effect any transaction on behalf of the Trust.
10.11 RESIGNATION. The Trustee or Custodian may resign
its position at any time by giving 30 days' written notice in
advance to the Employer and to the Advisory Committee. If the
Employer fails to appoint a successor Trustee within 60 days of
its receipt of the Trustee's written notice of resignation, the
Trustee will treat the Employer as having appointed itself as
Trustee and as having filed its acceptance of appointment with
the former Trustee. The Employer, in its sole discretion, may
replace a Custodian. If the Employer does not replace a
Custodian, the discretionary Trustee will assume possession of
Plan assets held by the former Custodian.
10.12 REMOVAL. The Employer, by giving 30 days' written
notice in advance to the Trustee, may remove any Trustee or
Custodian. In the event of the resignation or removal of a
Trustee, the Employer must appoint a successor Trustee if it
intends to continue the Plan. If two or more persons hold the
position of Trustee, in the event of the removal of one such
person, during any period the selection of a replacement is
pending, or during any period such person is unable to serve for
any reason, the remaining person or persons will act as the
Trustee.
10.13 INTERIM DUTIES AND SUCCESSOR TRUSTEE. Each
successor Trustee succeeds to the title to the Trust vested in
his predecessor by accepting in writing his appointment as
successor Trustee and by filing the acceptance with the former
Trustee and the Advisory Committee without the signing or filing
of any further statement. The resigning or removed Trustee, upon
receipt of acceptance in writing of the Trust by the successor
Trustee, must execute all documents and do all acts necessary to
vest the title of record in any successor Trustee. Each successor
Trustee has and enjoys all of the powers, both discretionary and
ministerial, conferred under this Agreement upon his predecessor.
A successor Trustee is not personally liable for any act or
failure to act of any predecessor Trustee, except as required
under ERISA. With the approval of the Employer and the Advisory
Committee, a successor Trustee, with respect to the Plan, may
accept the account rendered and the property delivered to it by a
predecessor Trustee without incurring any liability or
responsibility for so doing.
10.14 VALUATION OF TRUST. The Trustee must value the
Trust Fund as of each Accounting Date to determine the fair
market value of each Participant's Accrued Benefit in the Trust.
The Trustee also must value the Trust Fund on such other
valuation dates as directed in writing by the Advisory Committee
or as required by the Employer's Adoption Agreement.
10.15 LIMITATION ON LIABILITY - IF INVESTMENT MANAGER,
ANCILLARY TRUSTEE OR INDEPENDENT FIDUCIARY APPOINTED. The Trustee
is not liable for the acts or omissions of any Investment Manager
the Advisory Committee may appoint, nor is the Trustee under any
obligation to invest or otherwise manage any asset of the Plan
which is subject to the management of a properly appointed
Investment Manager. The Advisory Committee, the Trustee and any
properly appointed Investment Manager may execute a letter
agreement as a part of this Plan delineating the duties,
responsibilities and liabilities of the Investment Manager with
respect to any part of the Trust Fund under the control of the
Investment Manager.
The limitation on liability described in this Section 10.15
also applies to the acts or omissions of any ancillary trustee or
independent fiduciary properly appointed under Section 10.17 of
the Plan. However, if a discretionary Trustee, pursuant to the
delegation described in Section 10.17 of the Plan, appoints an
ancillary trustee, the discretionary Trustee is responsible for
the periodic review of the ancillary trustee's actions and must
exercise its delegated authority in accordance with the terms of
the Plan and in a manner consistent with ERISA. The Employer, the
discretionary Trustee and an ancillary trustee may execute a
letter agreement as a part of this Plan delineating any
indemnification agreement between the parties.
10.16 INVESTMENT IN GROUP TRUST FUND. The Employer, by
adopting this Plan, specifically authorizes the Trustee to invest
all or any portion of the assets comprising the Trust Fund in any
group trust fund which at the time of the investment provides for
the pooling of the assets of plans qualified under Code
Sect.401(a). This authorization applies solely to a group trust
fund exempt from taxation under Code Sect.501(a) and the trust
agreement of which satisfies the requirements of Revenue Ruling
81-100. The provisions of the group trust fund agreement, as
amended from time to time, are by this reference incorporated
within this Plan and Trust. The provisions of the group trust
fund will govern any investment of Plan assets in that fund. The
Employer must specify in an attachment to its adoption agreement
the group trust fund(s) to which this authorization applies. If
the Trustee is acting as a nondiscretionary Trustee, the
investment in the group trust fund is available only in
accordance with a proper direction, by the Named Fiduciary, in
accordance with Section 10.03[B]. Pursuant to paragraph (c) of
Section 10.03[A] of the Plan, a Trustee has the authority to
invest in certain common trust funds and collective investment
funds without the need for the authorizing addendum described in
this Section 10.16.
Furthermore, at the Employer's direction, the Trustee, for
collective investment purposes, may combine into one trust fund
the Trust created under this Plan with the Trust created under
any other qualified retirement plan the Employer maintains.
However, the Trustee must maintain separate records of account
for the assets of each Trust in order to reflect properly each
Participant's Accrued Benefit under the plan(s) in which he is a
Participant.
10.17 APPOINTMENT OF ANCILLARY TRUSTEE OR INDEPENDENT
FIDUCIARY. The Employer, in writing, may appoint any person in
any State to act as ancillary trustee with respect to a
designated portion of the Trust Fund, subject to the consent
required under Section 1.02 if the Master Plan Sponsor is a
financial institution. An ancillary trustee must acknowledge in
writing its acceptance of the terms and conditions of its
appointment as ancillary trustee and its fiduciary status under
ERISA. The ancillary trustee has the rights, powers, duties and
discretion as the Employer may delegate, subject to any
limitations or directions specified in the instrument evidencing
appointment of the ancillary trustee and to the terms of the Plan
or of ERISA. The investment powers delegated to the ancillary
trustee may include any investment powers available under Section
10.03 of the Plan including the right to invest any portion of
the assets of the Trust Fund in a common trust fund, as described
in Code Sect.584, or in any collective investment fund, the
provisions of which govern the investment of such assets and
which the Plan incorporates by this reference, but only if the
ancillary trustee is a bank or similar financial institution
supervised by the United States or by a State and the ancillary
trustee (or its affiliate, as defined in Code Sect.1504)
maintains the common trust fund or collective investment fund
exclusively for the collective investment of money contributed by
the ancillary trustee (or its affiliate) in a trustee capacity
and which conforms to the rules of the Comptroller of the
Currency. The Employer also may appoint as an ancillary trustee,
the trustee of any group trust fund designated for investment
pursuant to the provisions of Section 10.16 of the Plan.
The ancillary trustee may resign its position at any time by
providing at least 30 days' advance written notice to the
Employer, unless the Employer waives this notice requirement. The
Employer, in writing, may remove an ancillary trustee at any
time. In the event of resignation or removal, the Employer may
appoint another ancillary trustee, return the assets to the
control and management of the Trustee or receive such assets in
the capacity of ancillary trustee. The Employer may delegate its
responsibilities under this Section 10.17 to a discretionary
Trustee under the Plan, but not to a nondiscretionary Trustee or
to a Custodian, subject to the acceptance by the discretionary
Trustee of that delegation.
If the U.S. Department of Labor ("the Department") requires
engagement of an independent fiduciary to have control or
management of all or a portion of the Trust Fund, the Employer
will appoint such independent fiduciary, as directed by the
Department. The independent fiduciary will have the duties,
responsibilities and powers prescribed by the Department and will
exercise those duties, responsibilities and powers in accordance
with the terms, restrictions and conditions established by the
Department and, to the extent not inconsistent with ERISA, the
terms of the Plan. The independent fiduciary must accept its
appointment in writing and must acknowledge its status as a
fiduciary of the Plan.
10.18 EVIDENCE OF ACTION BY ADVISORY COMMITTEE. Any
action to be taken or any direction to be given by the Advisory
Committee shall be taken or given by written instrument signed on
behalf of the Advisory Committee by the person or persons
designated by the Advisory Committee to give notification,
instructions or advice to the Trustee, as the case may be. The
chairman of the Advisory Committee shall certify to the Trustee
the name or names of any person or persons designated to give
notifications, instructions or advice to the Trustee. Until the
Advisory Committee notifies the Trustee that any such person is
no longer authorized to act for the Advisory Committee, the
Trustee may continue to rely on the authority of such person.
The Trustee may rely upon any certificate, notice or direction
purporting to have been signed on behalf of the Advisory
Committee which the Trustee believes to have been signed by the
person or persons authorized to act for the Advisory Committee.
In the event that any dispute shall arise as to the persons to
whom payment of any funds or delivery of any assets shall be made
by the Trustee, the Trustee may withhold such payment or delivery
until such dispute shall have been determined by a court of
competent jurisdiction or shall have been settled by the parties
concerned.
The Employer hereby agrees to indemnify the Trustee against any
and all claims, liabilities, costs or expenses incurred by the
Trustee resulting from the breach or an alleged breach of a
fiduciary duty to the Plan by a party other than the Trustee,
including but not limited to, any fiduciary duty or
responsibility owed to the Plan by an Investment Manager
appointed hereunder or any predecessor trustee; provided,
however, that, except as otherwise provided in Section 7.03,
nothing herein shall be construed as an indemnification of the
Trustee for any claims, liabilities, costs or expenses resulting
from a breach of its own fiduciary duties with respect to the
Plan or Trust or its own gross negligence or willful misconduct.
Communications to the Trustee shall be sent to the Trustee's
registered office or to such other address as the Trustee may
specify in writing. No communications shall be binding upon the
Trust Fund or the Trustee until it is received by the Trustee.
Communications to the Advisory Committee or to the Employer shall
be sent to the Employer's principal office or to such other
address as the Employer may specify in writing.
10.19 ALLOCATION OF RESPONSIBILITIES AMONG FIDUCIARIES.
For purposes of ERISA, it is recognized that the Employer,
Trustee, Plan Administrator, Advisory Committee and the
Investment Manager, if any, are fiduciaries (collectively
referred to herein as "Fiduciaries"), but only with respect to
those specific powers, duties, responsibilities and obligations
as are specifically given them under the Plan; provided, however,
that nothing herein shall prevent a Fiduciary from acting in more
than one fiduciary capacity under the Plan. Each Fiduciary may
rely upon any such direction, information or action of another
Fiduciary as being proper under the Plan and in the absence of
actual knowledge to the contrary is not required under the Plan
to inquire into the propriety of any such direction, information
or action. It is intended that each Fiduciary shall be
responsible for the proper exercise of its own powers, duties,
responsibilities and obligations under the Plan and, except as
otherwise provided by applicable law which cannot be waived,
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 values.
10.20 SPECIAL PROVISIONS REGARDING RETIREMENT INVESTMENT
TRUSTS. If the Trustee invests funds of the Trust in the
Retirement Investment Trust, funds so invested will be subject to
the fees charged by the Retirement Investment Trust and the
otherwise applicable Trustee fees may be modified as described in
Section 10.05 of this Plan, which may result in an overall
increase in the total fees charged to the Trust, all as more
fully set forth in the current Prospectus of the Retirement
Investment Trust (the "Prospectus"). The Plan Administrator in
the Adoption Agreement shall specifically authorize the
Supervisory Committee of the Retirement Investment Trust to
appoint an investment advisor according to its Rules and
Procedures and to pay the investment advisor the fees and
expenses described in the Prospectus. Furthermore, with respect
to any investment in the Retirement Investment Trust, the
Employer shall in the Adoption Agreement waive in advance its
right under Texas law to receive written confirmations of
purchases and sales of interests in the Retirement Investment
Trust. The Employer shall acknowledge to the Trustee receipt of
the current Prospectus and shall deliver a copy thereof to each
Participant in the Plan, if direction of investment is permitted,
and shall deliver to each Participant making contributions and
each new Participant, a copy of the then-current Prospectus. The
provisions of this Section 10.20 shall equally apply to any other
open-ended, diversified management company described in Section
10.03[A](p).
* * * * * * * * * * * * * * *
ARTICLE XI
PROVISIONS RELATING TO INSURANCE AND INSURANCE COMPANY
11.01 INSURANCE BENEFIT. The Employer may elect to
provide incidental life insurance benefits for insurable
Participants who consent to life insurance benefits by signing
the appropriate insurance company application form. The Trustee
will not purchase any incidental life insurance benefit for any
Participant prior to an allocation to the Participant's Account.
At an insured Participant's written direction, the Trustee will
use all or any portion of the Participant's nondeductible
voluntary contributions, if any, to pay insurance premiums
covering the Participant's life. This Section 11.01 also
authorizes the purchase of life insurance, for the benefit of the
Participant, on the life of a family member of the Participant or
on any person in whom the Participant has an insurable interest.
However, if the policy is on the joint lives of the Participant
and another person, the Trustee may not maintain that policy if
that other person predeceases the Participant.
The Employer will direct the Trustee as to the insurance
company and insurance agent through which the Trustee is to
purchase the insurance contracts, the amount of the coverage and
the applicable dividend plan. Each application for a policy, and
the policies themselves, must designate the Trustee as sole
owner, with the right reserved to the Trustee to exercise any
right or option contained in the policies, subject to the terms
and provisions of this Agreement. The Trustee must be the named
beneficiary for the Account of the insured Participant. Proceeds
of insurance contracts paid to the Participant's Account under
this Article XI are subject to the distribution requirements of
Article V and of Article VI. The Trustee will not retain any such
proceeds for the benefit of the Trust.
The Trustee will charge the premiums on any incidental
benefit insurance contract covering the life of a Participant
against the Account of that Participant. The Trustee will hold
all incidental benefit insurance contracts issued under the Plan
as assets of the Trust created under the Plan.
(A) Incidental insurance benefits. The aggregate of life
insurance premiums paid for the benefit of a Participant, at all
times, may not exceed the following percentages of the aggregate
of the Employer's contributions allocated to any Participant's
Account: (i) 49% in the case of the purchase of ordinary life
insurance contracts; or (ii) 25% in the case of the purchase of
term life insurance or universal life insurance contracts. If the
Trustee purchases a combination of ordinary life insurance
contract(s) and term life insurance or universal life insurance
contract(s), then the sum of one-half of the premiums paid for
the ordinary life insurance contract(s) and the premiums paid for
the term life insurance or universal life insurance contract(s)
may not exceed 25% of the Employer contributions allocated to any
Participant's Account.
(B) Exception for certain profit sharing plans. If the Employer's
Plan is a profit sharing plan, the incidental insurance benefits
requirement does not apply to the Plan if the Plan purchases life
insurance benefits only from Employer contributions accumulated
in the Participant's Account for at least two years (measured
from the allocation date).
11.02 LIMITATION ON LIFE INSURANCE PROTECTION. The
Trustee will not continue any life insurance protection for any
Participant beyond his annuity starting date (as defined in
Article VI). If the Trustee holds any incidental benefit
insurance contract(s) for the benefit of a Participant when he
terminates his employment (other than by reason of death), the
Trustee must proceed as follows:
(a) If the entire cash value of the contract(s) is vested in
the terminating Participant, or if the contract(s) will have
no cash value at the end of the policy year in which
termination of employment occurs, the Trustee will transfer
the contract(s) to the Participant endorsed so as to vest in
the transferee all right, title and interest to the
contract(s), free and clear of the Trust; subject however,
to restrictions as to surrender or payment of benefits as
the issuing insurance company may permit and as the Advisory
Committee directs;
(b) If only part of the cash value of the contract(s) is
vested in the terminating Participant, the Trustee, to the
extent the Participant's interest in the cash value of the
contract(s) is not vested, may adjust the Participant's
interest in the value of his Account attributable to Trust
assets other than incidental benefit insurance contracts and
proceed as in (a), or the Trustee must effect a loan from
the issuing insurance company on the sole security of the
contract(s) for an amount equal to the difference between
the cash value of the contract(s) at the end of the policy
year in which termination of employment occurs and the
amount of the cash value that is vested in the terminating
Participant, and the Trustee must transfer the contract(s)
endorsed so as to vest in the transferee all right, title
and interest to the contract(s), free and clear of the
Trust; subject however, to the restrictions as to surrender
or payment of benefits as the issuing insurance company may
permit and the Advisory Committee directs;
(c) If no part of the cash value of the contract(s) is
vested in the terminating Participant, the Trustee must
surrender the contract(s) for cash proceeds as may be
available.
In accordance with the written direction of the Advisory
Committee, the Trustee will make any transfer of contract(s)
under this Section 11.02 on the Participant's annuity starting
date (or as soon as administratively practicable after that
date). The Trustee may not transfer any contract under this
Section 11.02 which contains a method of payment not specifically
authorized by Article VI or which fails to comply with the joint
and survivor annuity requirements, if applicable, of Article VI.
In this regard, the Trustee either must convert such a contract
to cash and distribute the cash instead of the contract, or
before making the transfer, require the issuing company to delete
the unauthorized method of payment option from the contract.
11.03 DEFINITIONS. For purposes of this Article XI:
(a) "Policy" means an ordinary life insurance contract or a
term life insurance contract issued by an insurer on the
life of a Participant.
(b) "Issuing insurance company" is any life insurance
company which has issued a policy upon application by the
Trustee under the terms of this Agreement.
(c) "Contract" or "Contracts" means a policy of insurance.
In the event of any conflict between the provisions of this
Plan and the terms of any contract or policy of insurance
issued in accordance with this Article XI, the provisions of
the Plan control.
(d) "Insurable Participant" means a Participant to whom an
insurance company, upon an application being submitted in
accordance with the Plan, will issue insurance coverage,
either as a standard risk or as a risk in an extra mortality
classification.
11.04 DIVIDEND PLAN. The dividend plan is premium
reduction unless the Advisory Committee directs the Trustee to
the contrary. The Trustee must use all dividends for a contract
to purchase insurance benefits or additional insurance benefits
for the Participant on whose life the insurance company has
issued the contract. Furthermore, the Trustee must arrange, where
possible, for all policies issued on the lives of Participants
under the Plan to have the same premium due date and all ordinary
life insurance contracts to contain guaranteed cash values with
as uniform basic options as are possible to obtain. The term
"dividends" includes policy dividends, refunds of premiums and
other credits.
11.05 INSURANCE COMPANY NOT A PARTY TO AGREEMENT. No
insurance company, solely in its capacity as an issuing insurance
company, is a party to this Agreement nor is the company
responsible for its validity.
11.06 INSURANCE COMPANY NOT RESPONSIBLE FOR TRUSTEE'S
ACTIONS. No insurance company, solely in its capacity as an
issuing insurance company, need examine the terms of this
Agreement nor is responsible for any action taken by the Trustee.
11.07 INSURANCE COMPANY RELIANCE ON TRUSTEE'S SIGNATURE.
For the purpose of making application to an insurance company and
in the exercise of any right or option contained in any policy,
the insurance company may rely upon the signature of the Trustee
and is saved harmless and completely discharged in acting at the
direction and authorization of the Trustee.
11.08 ACQUITTANCE. An insurance company is discharged
from all liability for any amount paid to the Trustee or paid in
accordance with the direction of the Trustee, and is not obliged
to see to the distribution or further application of any moneys
it so pays.
11.09 DUTIES OF INSURANCE COMPANY. Each insurance
company must keep such records, make such identification of
contracts, funds and accounts within funds, and supply such
information as may be necessary for the proper administration of
the Plan under which it is carrying insurance benefits.
Note: The provisions of this Article XI are not applicable,
and the Plan may not invest in insurance contracts, if a
Custodian signatory to the Adoption Agreement is a bank which has
not acquired trust powers from its governing state banking
authority.
* * * * * * * * * * * * * * *
ARTICLE XII
MISCELLANEOUS
12.01 EVIDENCE. Anyone required to give evidence under
the terms of the Plan may do so by certificate, affidavit,
document or other information which the person to act in reliance
may consider pertinent, reliable and genuine, and to have been
signed, made or presented by the proper party or parties. The
Advisory Committee and the Trustee are fully protected in acting
and relying upon any evidence described under the immediately
preceding sentence.
12.02 NO RESPONSIBILITY FOR EMPLOYER ACTION. Neither the
Trustee nor the Advisory Committee has any obligation or
responsibility with respect to any action required by the Plan to
be taken by the Employer, any Participant or eligible Employee,
or for the failure of any of the above persons to act or make any
payment or contribution, or to otherwise provide any benefit
contemplated under this Plan. Furthermore, the Plan does not
require the Trustee or the Advisory Committee to collect any
contribution required under the Plan, or to determine the
correctness of the amount of any Employer contribution. Neither
the Trustee nor the Advisory Committee need inquire into or be
responsible for any action or failure to act on the part of the
others, or on the part of any other person who has any
responsibility regarding the management, administration or
operation of the Plan, whether by the express terms of the Plan
or by a separate agreement authorized by the Plan or by the
applicable provisions of ERISA. Any action required of a
corporate Employer must be by its Board of Directors or its
designate.
12.03 FIDUCIARIES NOT INSURERS. All benefits payable
under the Plan shall be paid or provided for solely from the
Trust Fund. The Trustee, the Advisory Committee, the Plan
Administrator and the Employer in no way guarantee the Trust Fund
from loss or depreciation. The Employer does not guarantee the
payment of any money which may be or becomes due to any person
from the Trust Fund. the liability of the Advisory Committee and
the Trustee to make any payment from the Trust Fund at any time
and all times is limited to the then available assets of the
Trust.
12.04 WAIVER OF NOTICE. Any person entitled to notice
under the Plan may waive the notice, unless the Code or Treasury
regulations prescribe the notice or ERISA specifically or
impliedly prohibits such a waiver.
12.05 SUCCESSORS. The Plan is binding upon all persons
entitled to benefits under the Plan, their respective heirs and
legal representatives, upon the Employer, its successors and
assigns, and upon the Trustee, the Advisory Committee, the Plan
Administrator and their successors.
12.06 WORD USAGE. Words used in the masculine also apply
to the feminine where applicable, and wherever the context of the
Employer's Plan dictates, the plural includes the singular and
the singular includes the plural.
12.07 STATE LAW. The law of the state of the Master Plan
Sponsor's principal place of business (unless otherwise
designated in an addendum to the Employer's Adoption Agreement)
will determine all questions arising with respect to the
provisions of this Agreement except to the extent superseded by
Federal law.
12.08 EMPLOYER'S RIGHT TO PARTICIPATE. If the Employer's
Plan fails to qualify or to maintain qualification or if the
Employer makes any amendment or modification to a provision of
this Plan (other than a proper completion of an elective
provision under the Adoption Agreement or the attachment of an
addendum authorized by the Plan or by the Adoption Agreement),
the Employer may no longer participate under this Master Plan.
The Employer also may not participate (or continue to
participate) in this Master Plan if the Trustee or Custodian (or
a change in the Trustee or Custodian) does not satisfy the
requirements of Section 1.02 of the Plan. If the Employer is not
entitled to participate under this Master Plan, the Employer's
Plan is an individually-designed plan and the reliance procedures
specified in the applicable Adoption Agreement no longer will
apply.
12.09 EMPLOYMENT NOT GUARANTEED. Nothing contained in
this Plan, or with respect to the establishment of the Trust, or
any modification or amendment to the Plan or Trust, or in the
creation of any Account, or the payment of any benefit, gives any
Employee, Employee-Participant or any Beneficiary any right to
continue employment, any legal or equitable right against the
Employer, or Employee of the Employer, or against the Trustee, or
its agents or employees, or against the Plan Administrator,
except as expressly provided by the Plan, the Trust, ERISA or by
a separate agreement.
* * * * * * * * * * * * * * *
ARTICLE XIII
EXCLUSIVE BENEFIT, AMENDMENT, TERMINATION
13.01 EXCLUSIVE BENEFIT. Except as provided under
Article III, the Employer has no beneficial interest in any asset
of the Trust and no part of any asset in the Trust may ever
revert to or be repaid to an Employer, either directly or
indirectly; nor, prior to the satisfaction of all liabilities
with respect to the Participants and their Beneficiaries under
the Plan, may any part of the corpus or income of the Trust Fund,
or any asset of the Trust, be (at any time) used for, or diverted
to, purposes other than the exclusive benefit of the Participants
or their Beneficiaries. However, if the Commissioner of Internal
Revenue, upon the Employer's request for initial approval of this
Plan, determines the Trust created under the Plan is not a
qualified trust exempt from Federal income tax, then (and only
then) the Trustee, upon written notice from the Employer, will
return the Employer's contributions (and increment attributable
to the contributions) to the Employer. The Trustee must make the
return of the Employer contribution under this Section 13.01
within one year of a final disposition of the Employer's request
for initial approval of the Plan. The Employer's Plan and Trust
will terminate upon the Trustee's return of the Employer's
contributions.
13.02 AMENDMENT BY EMPLOYER. The Employer has the
right at any time and from time to time:
(a) To amend the elective provisions of the Adoption
Agreement in any manner it deems necessary or advisable in
order to qualify (or maintain qualification of) this Plan
and the Trust created under it under the provisions of Code
Sect.401(a);
(b) To amend the Plan to allow the Plan to operate under a
waiver of the minimum funding requirement; and
(c) To amend this Agreement in any other manner.
No amendment may authorize or permit any of the Trust Fund
(other than the part which is required to pay taxes and
administration expenses) to be used for or diverted to purposes
other than for the exclusive benefit of the Participants or their
Beneficiaries or estates. No amendment may cause or permit any
portion of the Trust Fund to revert to or become a property of
the Employer. The Employer also may not make any amendment which
affects the rights, duties or responsibilities of the Trustee,
the Plan Administrator or the Advisory Committee without the
written consent of the affected Trustee, the Plan Administrator
or the affected member of the Advisory Committee. The Employer
must make all amendments in writing. Each amendment must state
the date to which it is either retroactively or prospectively
effective. See Section 12.08 for the effect of certain amendments
adopted by the Employer.
(A) Code Sect.411(d)(6) protected benefits. An amendment
(including the adoption of this Plan as a restatement of an
existing plan) may not decrease a Participant's Accrued Benefit,
except to the extent permitted under Code Sect.412(c)(8), and may
not reduce or eliminate Code Sect.411(d)(6) protected benefits
determined immediately prior to the adoption date (or, if later,
the effective date) of the amendment. An amendment reduces or
eliminates Code Sect.411(d)(6) protected benefits if the
amendment has the effect of either (1) eliminating or reducing an
early retirement benefit or a retirement-type subsidy (as defined
in Treasury regulations), or (2) except as provided by Treasury
regulations, eliminating an optional form of benefit. The
Advisory Committee must disregard an amendment to the extent
application of the amendment would fail to satisfy this
paragraph. If the Advisory Committee must disregard an amendment
because the amendment would violate clause (1) or clause (2), the
Advisory Committee must maintain a schedule of the early
retirement option or other optional forms of benefit the Plan
must continue for the affected Participants.
13.03 AMENDMENT BY MASTER PLAN SPONSOR. The Master Plan
Sponsor (or PPD, as agent of the Master Plan Sponsor), without
the Employer's consent, may amend the Plan and Trust, from time
to time, in order to conform the Plan and Trust to any
requirement for qualification of the Plan and Trust under the
Internal Revenue Code. The Master Plan Sponsor may not amend the
Plan in any manner which would modify any election made by the
Employer under the Plan without the Employer's written consent.
Furthermore, the Master Plan Sponsor may not amend the Plan in
any manner which would violate the proscription of Section 13.02.
A Trustee does not have the power to amend the Plan or Trust.
13.04 DISCONTINUANCE. The Employer has the right, at any
time, to suspend or discontinue its contributions under the Plan,
and to terminate, at any time, this Plan and the Trust created
under this Agreement. The Plan will terminate upon the first to
occur of the following:
(a) The date terminated by action of the Employer;
(b) The dissolution or merger of the Employer, unless the
successor makes provision to continue the Plan, in which
event the successor must substitute itself as the Employer
under this Plan. Any termination of the Plan resulting from
this paragraph (b) is not effective until compliance with
any applicable notice requirements under ERISA.
13.05 FULL VESTING ON TERMINATION. Upon either full or
partial termination of the Plan, or, if applicable, upon complete
discontinuance of profit sharing plan contributions to the Plan,
an affected Participant's right to his Accrued Benefit is 100%
Nonforfeitable, irrespective of the Nonforfeitable percentage
which otherwise would apply under Article V.
13.06 MERGER/DIRECT TRANSFER. The Trustee may not
consent to, or be a party to, any merger or consolidation with
another plan, or to a transfer of assets or liabilities to
another plan, unless immediately after the merger, consolidation
or transfer, the surviving Plan provides each Participant a
benefit equal to or greater than the benefit each Participant
would have received had the Plan terminated immediately before
the merger or consolidation or transfer. The Trustee possesses
the specific authority to enter into merger agreements or direct
transfer of assets agreements with the trustees of other
retirement plans described in Code Sect.401(a), including an
elective transfer, and to accept the direct transfer of plan
assets, or to transfer plan assets, as a party to any such
agreement.
The Trustee may accept a direct transfer of plan assets on
behalf of an Employee prior to the date the Employee satisfies
the Plan's eligibility conditions. If the Trustee accepts such a
direct transfer of plan assets, the Advisory Committee and
Trustee must treat the Employee as a Participant for all purposes
of the Plan except the Employee is not a Participant for purposes
of sharing in Employer contributions or Participant forfeitures
under the Plan until he actually becomes a Participant in the
Plan.
(A) Elective transfers. The Trustee, after August 9, 1988, may
not consent to, or be a party to a merger, consolidation or
transfer of assets with a defined benefit plan, except with
respect to an elective transfer, or unless the transferred
benefits are in the form of paid-up individual annuity contracts
guaranteeing the payment of the transferred benefits in
accordance with the terms of the transferor plan and in a manner
consistent with the Code and with ERISA. The Trustee will hold,
administer and distribute the transferred assets as a part of the
Trust Fund and the Trustee must maintain a separate Employer
contribution Account for the benefit of the Employee on whose
behalf the Trustee accepted the transfer in order to reflect the
value of the transferred assets. Unless a transfer of assets to
this Plan is an elective transfer, the Plan will preserve all
Code Sect.411(d)(6) protected benefits with respect to those
transferred assets, in the manner described in Section 13.02. A
transfer is an elective transfer if: (1) the transfer satisfies
the first paragraph of this Section 13.06; (2) the transfer is
voluntary, under a fully informed election by the Participant;
(3) the Participant has an alternative that retains his Code
Sect.411(d)(6) protected benefits (including an option to leave
his benefit in the transferor plan, if that plan is not
terminating); (4) the transfer satisfies the applicable spousal
consent requirements of the Code; (5) the transferor plan
satisfies the joint and survivor notice requirements of the Code,
if the Participant's transferred benefit is subject to those
requirements; (6) the Participant has a right to immediate
distribution from the transferor plan, in lieu of the elective
transfer; (7) the transferred benefit is at least the greater of
the single sum distribution provided by the transferor plan for
which the Participant is eligible or the present value of the
Participant's accrued benefit under the transferor plan payable
at that plan's normal retirement age; (8) the Participant has a
100% Nonforfeitable interest in the transferred benefit; and (9)
the transfer otherwise satisfies applicable Treasury regulations.
An elective transfer may occur between qualified plans of any
type. Any direct transfer of assets from a defined benefit plan
after August 9, 1988, which does not satisfy the requirements of
this paragraph will render the Employer's Plan individually-
designed. See Section 12.08.
(B) Distribution restrictions under Code Sect.401(k). If the Plan
receives a direct transfer (by merger or otherwise) of elective
contributions (or amounts treated as elective contributions)
under a Plan with a Code Sect.401(k) arrangement, the
distribution restrictions of Code Sect.Sect.401(k)(2) and (10)
continue to apply to those transferred elective contributions.
13.07 TERMINATION.
(A) Procedure. Upon termination of the Plan, the distribution
provisions of Article VI remain operative, with the following
exceptions:
(1) if the present value of the Participant's Nonforfeitable
Accrued Benefit does not exceed $3,500, the Advisory
Committee will direct the Trustee to distribute the
Participant's Nonforfeitable Accrued Benefit to him in lump
sum as soon as administratively practicable after the Plan
terminates; and
(2) if the present value of the Participant's Nonforfeitable
Accrued Benefit exceeds $3,500, the Participant or the
Beneficiary, in addition to the distribution events
permitted under Article VI, may elect to have the Trustee
commence distribution of his Nonforfeitable Accrued Benefit
as soon as administratively practicable after the Plan
terminates.
To liquidate the Trust, the Advisory Committee will purchase
a deferred annuity contract for each Participant which protects
the Participant's distribution rights under the Plan, if the
Participant's Nonforfeitable Accrued Benefit exceeds $3,500 and
the Participant does not elect an immediate distribution pursuant
to Paragraph (2).
If the Employer's Plan is a profit sharing plan, in lieu of
the preceding provisions of this Section 13.07 and the
distribution provisions of Article VI, the Advisory Committee
will direct the Trustee to distribute each Participant's
Nonforfeitable Accrued Benefit, in lump sum, as soon as
administratively practicable after the termination of the Plan,
irrespective of the present value of the Participant's
Nonforfeitable Accrued Benefit and whether the Participant
consents to that distribution. This paragraph does not apply if:
(1) the Plan provides an annuity option; or (2) as of the period
between the Plan termination date and the final distribution of
assets, the Employer maintains any other defined contribution
plan (other than an ESOP). The Employer, in an addendum to its
Adoption Agreement numbered 13.07, may elect not to have this
paragraph apply.
The Trust will continue until the Trustee in accordance with
the direction of the Advisory Committee has distributed all of
the benefits under the Plan. On each valuation date, the Advisory
Committee will credit any part of a Participant's Accrued Benefit
retained in the Trust with its proportionate share of the Trust's
income, expenses, gains and losses, both realized and unrealized.
Upon termination of the Plan, the amount, if any, in a suspense
account under Article III will revert to the Employer, subject to
the conditions of the Treasury regulations permitting such a
reversion. A resolution or amendment to freeze all future benefit
accrual but otherwise to continue maintenance of this Plan, is
not a termination for purposes of this Section 13.07.
(B) Distribution restrictions under Code Sect.401(k). If the
Employer's Plan includes a Code Sect.401(k) arrangement or if
transferred assets described in Section 13.06 are subject to the
distribution restrictions of Code Sect.Sect.401(k)(2) and (10),
the special distribution provisions of this Section 13.07 are
subject to the restrictions of this paragraph. The portion of the
Participant's Nonforfeitable Accrued Benefit attributable to
elective contributions (or to amounts treated under the Code
Sect.401(k) arrangement as elective contributions) is not
distributable on account of Plan termination, as described in
this Section 13.07, unless: (a) the Participant otherwise is
entitled under the Plan to a distribution of that portion of his
Nonforfeitable Accrued Benefit; or (b) the Plan termination
occurs without the establishment of a successor plan. A
successor plan under clause (b) is a defined contribution plan
(other than an ESOP) maintained by the Employer (or by a related
employer) at the time of the termination of the Plan or within
the period ending twelve months after the final distribution of
assets. A distribution made after March 31, 1988, pursuant to
clause (b), must be part of a lump sum distribution to the
Participant of his Nonforfeitable Accrued Benefit.
* * * * * * * * * * * * * * *
ARTICLE XIV
CODE Sect.401(k) AND CODE Sect.401(m) ARRANGEMENTS
14.01 APPLICATION. This Article XIV applies to an Employer's
Plan only if the Employer is maintaining its Plan under a Code
Sect.401(k) Adoption Agreement.
14.02 CODE Sect.401(k) ARRANGEMENT. The Employer will elect
in Section 3.01 of its Adoption Agreement the terms of the Code
Sect.401(k) arrangement, if any, under the Plan. If the
Employer's Plan is a Standardized Plan, the Code Sect.401(k)
arrangement must be a salary reduction arrangement. If the
Employer's Plan is a Nonstandardized Plan, the Code Sect.401(k)
arrangement may be a salary reduction arrangement or a cash or
deferred arrangement.
(A) Salary Reduction Arrangement. If the Employer elects a
salary reduction arrangement, any Employee eligible to
participate in the Plan may file a salary reduction agreement
with the Advisory Committee. The salary reduction agreement may
not be effective earlier than the following date which occurs
last: (i) the Employee's Plan Entry Date (or, in the case of a
reemployed Employee, his reparticipation date under Article II);
(ii) the execution date of the Employee's salary reduction
agreement; (iii) the date the Employer adopts the Code
Sect.401(k) arrangement by executing the Adoption Agreement; or
(iv) the effective date of the Code Sect.401(k) arrangement, as
specified in the Employer's Adoption Agreement. Regarding clause
(i), an Employee subject to the Break in Service rule of Section
2.03(B) of the Plan may not enter into a salary reduction
agreement until the Employee has completed a sufficient number of
Hours of Service to receive credit for a Year of Service (as
defined in Section 2.02) following his reemployment commencement
date. A salary reduction agreement must specify the amount of
Compensation (as defined in Section 1.12) or percentage of
Compensation the Employee wishes to defer. The salary reduction
agreement will apply only to Compensation which becomes currently
available to the Employee after the effective date of the salary
reduction agreement. The Employer will apply a reduction election
to all Compensation (and to increases in such Compensation)
unless the Employee specifies in his salary reduction agreement
to limit the election to certain Compensation. The Employer will
specify in Adoption Agreement Section 3.01 the rules and
restrictions applicable to the Employees salary reduction
agreements.
(B) Cash or deferred arrangement. If the Employer elects a cash
or deferred arrangement, a Participant may elect to make a cash
election against his proportionate share of the Employer's Cash
or Deferred Contribution, in accordance with the Employer's
elections in Adoption Agreement Section 3.01. A Participant's
proportionate share of the Employer's Cash or Deferred
Contribution is the percentage of the total Cash or Deferred
Contribution which bears the same ratio that the Participant's
Compensation for the Plan Year bears to the total Compensation of
all Participants for the Plan Year. For purposes of determining
each Participant's proportionate share of the Cash or Deferred
Contribution, a Participant's Compensation is his Compensation as
determined under Section 1.12 of the Plan (as modified by Section
3.06 for allocation purposes), excluding any effect the
proportionate share may have on the Participant's Compensation
for the Plan Year. The Advisory Committee will determine the
proportionate share prior to the Employer's actual contribution
to the Trust, to provide the Participants the opportunity to file
cash elections. The Employer will pay directly to the Participant
the portion of his proportionate share the Participant has
elected to receive in cash.
(C) Election not to participate. A Participant's or Employee's
election not to participate, pursuant to Section 2.06, includes
his right to enter into a salary reduction agreement or to share
in the allocation of a Cash or Deferred Contribution, unless the
Participant or Employee limits the effect of the election to the
non-401(k) portions of the Plan.
14.03 DEFINITIONS. For purposes of this Article XIV:
(a) "Highly Compensated Employee" means an Eligible
Employee who satisfies the definition in Section 1.09 of the
Plan. Family members aggregated as a single Employee under
Section 1.09 constitute a single Highly Compensated
Employee, whether a particular family member is a Highly
Compensated Employee or a Nonhighly Compensated Employee
without the application of family aggregation.
(b) "Nonhighly Compensated Employee" means an Eligible
Employee who is not a Highly Compensated Employee and who is
not a family member treated as a Highly Compensated
Employee.
(c) "Eligible Employee" means, for purposes of the ADP test
described in Section 14.08, an Employee who is eligible to
enter into a salary reduction agreement for the Plan Year,
irrespective of whether he actually enters into such an
agreement, and a Participant who is eligible for an
allocation of the Employer's Cash or Deferred Contribution
for the Plan Year. For purposes of the ACP test described in
Section 14.09, an "Eligible Employee" means a Participant
who is eligible to receive an allocation of matching
contributions (or would be eligible if he made the type of
contributions necessary to receive an allocation of matching
contributions) and a Participant who is eligible to make
nondeductible contributions, irrespective of whether he
actually makes nondeductible contributions. An Employee
continues to be an Eligible Employee during a period the
Plan suspends the Employee's right to make elective
deferrals or nondeductible contributions following a
hardship distribution.
(d) "Highly Compensated Group" means the group of Eligible
Employees who are Highly Compensated Employees for the Plan
Year.
(e) "Nonhighly Compensated Group" means the group of
Eligible Employees who are Nonhighly Compensated Employees
for the Plan Year.
(f) "Compensation" means, except as specifically provided
in this Article XIV, Compensation as defined for
nondiscrimination purposes in Section 1.12(B) of the Plan.
To compute an Employee's ADP or ACP, the Advisory Committee
may limit Compensation taken into account to Compensation
received only for the portion of the Plan Year in which the
Employee was an Eligible Employee and only for the portion
of the Plan Year in which the Plan or the Code Sect.401(k)
arrangement was in effect.
(g) "Deferral contributions" are Salary Reduction
Contributions and Cash or Deferred Contributions the
Employer contributes to the Trust on behalf of an Eligible
Employee, irrespective of whether, in the case of Cash or
Deferred Contributions, the contribution is at the election
of the Employee. For Salary Reduction Contributions, the
terms "deferral contributions" and "elective deferrals" have
the same meaning.
(h) "Elective deferrals" are all Salary Reduction
Contributions and that portion of any Cash or Deferred
Contribution which the Employer contributes to the Trust at
the election of an Eligible Employee. Any portion of a Cash
or Deferred Contribution contributed to the Trust because of
the Employee's failure to make a cash election is an
elective deferral. However, any portion of a Cash or
Deferred Contribution over which the Employee does not have
a cash election is not an elective deferral. Elective
deferrals do not include amounts which have become currently
available to the Employee prior to the election nor amounts
designated as nondeductible contributions at the time of
deferral or contribution.
(i) "Matching contributions" are contributions made by the
Employer on account of elective deferrals under a Code
Sect.401(k) arrangement or on account of employee
contributions. Matching contributions also include
Participant forfeitures allocated on account of such
elective deferrals or employee contributions.
(j) "Nonelective contributions" are contributions made by
the Employer which are not subject to a deferral election by
an Employee and which are not matching contributions.
(k) "Qualified matching contributions" are matching
contributions which are 100% Nonforfeitable at all times and
which are subject to the distribution restrictions described
in paragraph (m). Matching contributions are not 100%
Nonforfeitable at all times if the Employee has a 100%
Nonforfeitable interest because of his Years of Service
taken into account under a vesting schedule. Any matching
contributions allocated to a Participant's Qualified
Matching Contributions Account under the Plan automatically
satisfy the definition of qualified matching contributions.
(l) "Qualified nonelective contributions" are nonelective
contributions which are 100% Nonforfeitable at all times and
which are subject to the distribution restrictions described
in paragraph (m). Nonelective contributions are not 100%
Nonforfeitable at all times if the Employee has a 100%
Nonforfeitable interest because of his Years of Service
taken into account under a vesting schedule. Any nonelective
contributions allocated to a Participant's Qualified
Nonelective Contributions Account under the Plan
automatically satisfy the definition of qualified
nonelective contributions.
(m) "Distribution restrictions" means the Employee may not
receive a distribution of the specified contributions (nor
earnings on those contributions) except in the event of (1)
the Participant's death, disability, termination of
employment or attainment of age 59 1/2, (2) financial hardship
satisfying the requirements of Code Sect.401(k) and the
applicable Treasury regulations, (3) a plan termination,
without establishment of a successor defined contribution
plan (other than an ESOP), (4) a sale of substantially all
of the assets (within the meaning of Code Sect.409(d)(2))
used in a trade or business, but only to an employee who
continues employment with the corporation acquiring those
assets, or (5) a sale by a corporation of its interest in a
subsidiary (within the meaning of Code Sect.409(d)(3)), but
only to an employee who continues employment with the
subsidiary. For Plan Years beginning after December 31,
1988, a distribution on account of financial hardship, as
described in clause (2), may not include earnings on
elective deferrals credited as of a date later than December
31, 1988, and may not include qualified matching
contributions and qualified nonelective contributions, nor
any earnings on such contributions, credited after December
31, 1988. A plan does not violate the distribution
restrictions if, instead of the December 31, 1988, date in
the preceding sentence the plan specifies a date not later
than the end of the last Plan Year ending before July 1,
1989. A distribution described in clauses (3), (4) or (5),
if made after March 31, 1988, must be a lump sum
distribution, as required under Code Sect.401(k)(10).
(n) "Employee contributions" are contributions made by a
Participant on an after-tax basis, whether voluntary or
mandatory, and designated, at the time of contribution, as
an employee (or nondeductible) contribution. Elective
deferrals and deferral contributions are not employee
contributions. Participant nondeductible contributions, made
pursuant to Section 4.01 of the Plan, are employee
contributions.
14.04 MATCHING CONTRIBUTIONS/EMPLOYEE CONTRIBUTIONS. The
Employer may elect in Adoption Agreement Section 3.01 to provide
matching contributions. The Employer also may elect in Adoption
Agreement Section 4.01 to permit or to require a Participant to
make nondeductible contributions.
(A) Mandatory contributions. Any Participant nondeductible
contributions eligible for matching contributions are mandatory
contributions. The Advisory Committee will maintain a separate
accounting, pursuant to Section 4.06 of the Plan, to reflect the
Participant's Accrued Benefit derived from his mandatory
contributions. The Employer, under Adoption Agreement Section
4.05, may prescribe special distribution restrictions which will
apply to the Mandatory Contributions Account prior to the
Participant's Separation from Service. Following his Separation
from Service, the general distribution provisions of Article VI
apply to the distribution of the Participant's Mandatory
Contributions Account.
14.05 TIME OF PAYMENT OF CONTRIBUTIONS. The Employer must
make Salary Reduction Contributions to the Trust within an
administratively reasonable period of time after withholding the
corresponding Compensation from the Participant. Furthermore, the
Employer must make Salary Reduction Contributions, Cash or
Deferred Contributions, Employer matching contributions
(including qualified Employer matching contributions) and
qualified Employer nonelective contributions no later than the
time prescribed by the Code or by applicable Treasury
regulations. Salary Reduction Contributions and Cash or Deferred
Contributions are Employer contributions for all purposes under
this Plan, except to the extent the Code or Treasury regulations
prohibit the use of these contributions to satisfy the
qualification requirements of the Code.
14.06 SPECIAL ALLOCATION PROVISIONS - DEFERRAL
CONTRIBUTIONS, MATCHING CONTRIBUTIONS AND QUALIFIED NONELECTIVE
CONTRIBUTIONS. To make allocations under the Plan, the
Advisory Committee must establish a Deferral Contributions
Account, a Qualified Matching Contributions Account, a Regular
Matching Contributions Account, a Qualified Nonelective
Contributions Account and an Employer Contributions Account for
each Participant.
(A) Deferral contributions. The Advisory Committee will allocate
to each Participant's Deferral Contributions Account the amount
of Deferral Contributions the Employer makes to the Trust on
behalf of the Participant. The Advisory Committee will make this
allocation as of the last day of each Plan Year unless, in
Adoption Agreement Section 3.04, the Employer elects more
frequent allocation dates for salary reduction contributions.
(B) Matching contributions. The Employer must specify in its
Adoption Agreement whether the Advisory Committee will allocate
matching contributions to the Qualified Matching Contributions
Account or to the Regular Matching Contributions Account of each
Participant. The Advisory Committee will make this allocation as
of the last day of each Plan Year unless, in Adoption Agreement
Section 3.04, the Employer elects more frequent allocation dates
for matching contributions.
(1) To the extent the Employer makes matching contributions
under a fixed matching contribution formula, the Advisory
Committee will allocate the matching contribution to the
Account of the Participant on whose behalf the Employer
makes that contribution. A fixed matching contribution
formula is a formula under which the Employer contributes a
certain percentage or dollar amount on behalf of a
Participant based on that Participant's deferral
contributions or nondeductible contributions eligible for a
match, as specified in Section 3.01 of the Employer's
Adoption Agreement. The Employer may contribute on a
Participant's behalf under a specific matching contribution
formula only if the Participant satisfies the accrual
requirements for matching contributions specified in Section
3.06 of the Employer's Adoption Agreement and only to the
extent the matching contribution does not exceed the
Participant's annual additions limitation in Part 2 of
Article III.
(2) To the extent the Employer makes matching contributions
under a discretionary formula, the Advisory Committee will
allocate the discretionary matching contributions to the
Account of each Participant who satisfies the accrual
requirements for matching contributions specified in Section
3.06 of the Employer's Adoption Agreement. The allocation of
discretionary matching contributions to a Participant's
Account is in the same proportion that each Participant's
eligible contributions bear to the total eligible
contributions of all Participants. If the discretionary
formula is a tiered formula, the Advisory Committee will
make this allocation separately with respect to each tier of
eligible contributions, allocating in such manner the amount
of the matching contributions made with respect to that
tier. "Eligible contributions" are the Participant's
deferral contributions or nondeductible contributions
eligible for an allocation of matching contributions, as
specified in Section 3.01 of the Employer's Adoption
Agreement.
If the matching contribution formula applies both to
deferral contributions and to Participant nondeductible
contributions, the matching contributions apply first to deferral
contributions. Furthermore, the matching contribution formula
does not apply to deferral contributions that are excess
deferrals under Section 14.07. For this purpose: (a) excess
deferrals relate first to deferral contributions for the Plan
Year not otherwise eligible for a matching contribution; and (2)
if the Plan Year is not a calendar year, the excess deferrals for
a Plan Year are the last elective deferrals made for a calendar
year. Under a Standardized Plan, an Employee forfeits any
matching contribution attributable to an excess contribution or
to an excess aggregate contribution, unless distributed pursuant
to Sections 14.08 or 14.09. Under a Nonstandardized Plan, this
forfeiture rule applies only if specified in Adoption Agreement
Section 3.06. The provisions of Section 3.05 govern the treatment
of any forfeiture described in this paragraph, and the Advisory
Committee will compute a Participant's ACP under 14.09 by
disregarding the forfeiture.
(C) Qualified nonelective contributions. If the Employer, at the
time of contribution, designates a contribution to be a qualified
nonelective contribution for the Plan Year, the Advisory
Committee will allocate that qualified nonelective contribution
to the Qualified Nonelective Contributions Account of each
Participant eligible for an allocation of that designated
contribution, as specified in Section 3.04 of the Employer's
Adoption Agreement. The Advisory Committee will make the
allocation to each eligible Participant's Account in the same
ratio that the Participant's Compensation for the Plan Year bears
to the total Compensation of all eligible Participants for the
Plan Year. The Advisory Committee will determine a Participant's
Compensation in accordance with the general definition of
Compensation under Section 1.12 of the Plan, as modified by the
Employer in Sections 1.12 and 3.06 of its Adoption Agreement.
(D) Nonelective contributions. To the extent the Employer makes
nonelective contributions for the Plan Year which, at the time of
contribution, it does not designate as qualified nonelective
contributions, the Advisory Committee will allocate those
contributions in accordance with the elections under Section 3.04
of the Employer's Adoption Agreement. For purposes of the special
nondiscrimination tests described in Sections 14.08 and 14.09,
the Advisory Committee may treat nonelective contributions
allocated under this paragraph as qualified nonelective
contributions, if the contributions otherwise satisfy the
definition of qualified nonelective contributions.
14.07 ANNUAL ELECTIVE DEFERRAL LIMITATION.
(A) Annual Elective Deferral Limitation. An Employee's elective
deferrals for a calendar year beginning after December 31, 1986,
may not exceed the 402(g) limitation. The 402(g) limitation is
the greater of $7,000 or the adjusted amount determined by the
Secretary of the Treasury. If, pursuant to a salary reduction
agreement or pursuant to a cash or deferral election, the
Employer determines the Employee's elective deferrals to the Plan
for a calendar year would exceed the 402(g) limitation, the
Employer will suspend the Employee's salary reduction agreement,
if any, until the following January 1 and pay in cash the portion
of a cash or deferral election which would result in the
Employee's elective deferrals for the calendar year exceeding the
402(g) limitation. If the Advisory Committee determines an
Employee's elective deferrals already contributed to the Plan for
a calendar year exceed the 402(g) limitation, the Advisory
Committee will distribute the amount in excess of the 402(g)
limitation (the "excess deferral"), as adjusted for allocable
income, no later than April 15 of the following calendar year. If
the Advisory Committee distributes the excess deferral by the
appropriate April 15, it may make the distribution irrespective
of any other provision under this Plan or under the Code. The
Advisory Committee will reduce the amount of excess deferrals for
a calendar year distributable to the Employee by the amount of
excess contributions (as determined in Section 14.08), if any,
previously distributed to the Employee for the Plan Year
beginning in that calendar year.
If an Employee participates in another plan under which he
makes elective deferrals pursuant to a Code Sect.401(k)
arrangement, elective deferrals under a Simplified Employee
Pension, or salary reduction contributions to a tax-sheltered
annuity, irrespective of whether the Employer maintains the other
plan, he may provide the Advisory Committee a written claim for
excess deferrals made for a calendar year. The Employee must
submit the claim no later than the March 1 following the close of
the particular calendar year and the claim must specify the
amount of the Employee's elective deferrals under this Plan which
are excess deferrals. If the Advisory Committee receives a timely
claim, it will distribute the excess deferral (as adjusted for
allocable income) the Employee has assigned to this Plan, in
accordance with the distribution procedure described in the
immediately preceding paragraph.
(B) Allocable income. For purposes of making a distribution of
excess deferrals pursuant to this Section 14.07, allocable income
means net income or net loss allocable to the excess deferrals
for the calendar year in which the Employee made the excess
deferral, determined in a manner which is uniform,
nondiscriminatory and reasonably reflective of the manner used by
the Plan to allocate income to Participants' Accounts.
14.08 ACTUAL DEFERRAL PERCENTAGE ("ADP") TEST. For each Plan
Year, the Advisory Committee must determine whether the Plan's
Code Sect.401(k) arrangement satisfies either of the following
ADP tests:
(i) The average ADP for the Highly Compensated Group does
not exceed 1.25 times the average ADP of the Nonhighly
Compensated Group; or
(ii) The average ADP for the Highly Compensated Group does
not exceed the average ADP for the Nonhighly Compensated
Group by more than two percentage points (or the lesser
percentage permitted by the multiple use limitation in
Section 14.10) and the average ADP for the Highly
Compensated Group is not more than twice the average ADP for
the Nonhighly Compensated Group.
(A) Calculation of ADP. The average ADP for a group is the
average of the separate ADPs calculated for each Eligible
Employee who is a member of that group. An Eligible Employee's
ADP for a Plan Year is the ratio of the Eligible Employee's
deferral contributions for the Plan Year to the Employee's
Compensation for the Plan Year. For aggregated family members
treated as a single Highly Compensated Employee, the ADP of the
family unit is the ADP determined by combining the deferral
contributions and Compensation of all aggregated family members.
A Nonhighly Compensated Employee's ADP does not include elective
deferrals made to this Plan or to any other Plan maintained by
the Employer, to the extent such elective deferrals exceed the
402(g) limitation described in Section 14.07(A).
The Advisory Committee, in a manner consistent with Treasury
regulations, may determine the ADPs of the Eligible Employees by
taking into account qualified nonelective contributions or
qualified matching contributions, or both, made to this Plan or
to any other qualified Plan maintained by the Employer. The
Advisory Committee may not include qualified nonelective
contributions in the ADP test unless the allocation of
nonelective contributions is nondiscriminatory when the Advisory
Committee takes into account all nonelective contributions
(including the qualified nonelective contributions) and also when
the Advisory Committee takes into account only the nonelective
contributions not used in either the ADP test described in this
Section 14.08 or the ACP test described in Section 14.09. For
Plan Years beginning after December 31, 1989, the Advisory
Committee may not include in the ADP test any qualified
nonelective contributions or qualified matching contributions
under another qualified plan unless that plan has the same plan
year as this Plan. The Advisory Committee must maintain records
to demonstrate compliance with the ADP test, including the extent
to which the Plan used qualified nonelective contributions or
qualified matching contributions to satisfy the test.
For Plan Years beginning prior to January 1, 1992, the
Advisory Committee may elect to apply a separate ADP test to each
component group under the Plan. Each component group separately
must satisfy the commonality requirement of the Code Sect.401(k)
regulations and the minimum coverage requirements of Code
Sect.410(b). A component group consists of all the allocations
and other benefits, rights and features provided that group of
Employees. An Employee may not be part of more than one component
group. The correction rules described in this Section 14.08 apply
separately to each component group.
(B) Special aggregation rule for Highly Compensated Employees.
To determine the ADP of any Highly Compensated Employee, the
deferral contributions taken into account must include any
elective deferrals made by the Highly Compensated Employee under
any other Code Sect.401(k) arrangement maintained by the
Employer, unless the elective deferrals are to an ESOP. If the
plans containing the Code Sect.401(k) arrangements have different
plan years, the Advisory Committee will determine the combined
deferral contributions on the basis of the plan years ending in
the same calendar year.
(C) Aggregation of certain Code Sect.401(k) arrangements. If the
Employer treats two plans as a unit for coverage or
nondiscrimination purposes, the Employer must combine the Code
Sect.401(k) arrangements under such plans to determine whether
either plan satisfies the ADP test. This aggregation rule applies
to the ADP determination for all Eligible Employees, irrespective
of whether an Eligible Employee is a Highly Compensated Employee
or a Nonhighly Compensated Employee. For Plan Years beginning
after December 31, 1989, an aggregation of Code Sect.401(k)
arrangements under this paragraph does not apply to plans which
have different plan years and, for Plan Years beginning after
December 31, 1988, the Advisory Committee may not aggregate an
ESOP (or the ESOP portion of a plan) with a non-ESOP plan (or
non-ESOP portion of a plan).
(D) Characterization of excess contributions. If, pursuant to
this Section 14.08, the Advisory Committee has elected to include
qualified matching contributions in the average ADP, the Advisory
Committee will treat excess contributions as attributable
proportionately to deferral contributions and to qualified
matching contributions allocated on the basis of those deferral
contributions. If the total amount of a Highly Compensated
Employee's excess contributions for the Plan Year exceeds his
deferral contributions or qualified matching contributions for
the Plan Year, the Advisory Committee will treat the remaining
portion of his excess contributions as attributable to qualified
nonelective contributions. The Advisory Committee will reduce the
amount of excess contributions for a Plan Year distributable to a
Highly Compensated Employee by the amount of excess deferrals (as
determined in Section 14.07), if any, previously distributed to
that Employee for the Employee's taxable year ending in that Plan
Year.
(E) Distribution of excess contributions. If the Advisory
Committee determines the Plan fails to satisfy the ADP test for a
Plan Year, it must distribute the excess contributions, as
adjusted for allocable income, during the next Plan Year.
However, the Employer will incur an excise tax equal to 10% of
the amount of excess contributions for a Plan Year not
distributed to the appropriate Highly Compensated Employees
during the first 2 1/2 months of that next Plan Year. The excess
contributions are the amount of deferral contributions made by
the Highly Compensated Employees which causes the Plan to fail to
satisfy the ADP test. The Advisory Committee will distribute to
each Highly Compensated Employee his respective share of the
excess contributions. The Advisory Committee will determine the
respective shares of excess contributions by starting with the
Highly Compensated Employee(s) who has the greatest ADP, reducing
his ADP (but not below the next highest ADP), then, if necessary,
reducing the ADP of the Highly Compensated Employee(s) at the
next highest ADP level (including the ADP of the Highly
Compensated Employee(s) whose ADP the Advisory Committee already
has reduced), and continuing in this manner until the average ADP
for the Highly Compensated Group satisfies the ADP test. If the
Highly Compensated Employee is part of an aggregated family
group, the Advisory Committee, in accordance with the applicable
Treasury regulations, will determine each aggregated family
member's allocable share of the excess contributions assigned to
the family unit.
(F) Allocable income. To determine the amount of the corrective
distribution required under this Section 14.08, the Advisory
Committee must calculate the allocable income for the Plan Year
in which the excess contributions arose. "Allocable income" means
net income or net loss. To calculate allocable income for the
Plan Year, the Advisory Committee will use a uniform and
nondiscriminatory method which reasonably reflects the manner
used by the Plan to allocate income to Participants' Accounts.
14.09 NONDISCRIMINATION RULES FOR EMPLOYER MATCHING
CONTRIBUTIONS/PARTICIPANT NONDEDUCTIBLE CONTRIBUTIONS. For Plan
Years beginning after December 31, 1986, the Advisory Committee
must determine whether the annual Employer matching contributions
(other than qualified matching contributions used in the ADP
under Section 14.08), if any, and the Employee contributions, if
any, satisfy either of the following average contribution
percentage ("ACP") tests:
(i) The ACP for the Highly Compensated Group does not
exceed 1.25 times the ACP of the Nonhighly Compensated
Group; or
(ii) The ACP for the Highly Compensated Group does not
exceed the ACP for the Nonhighly Compensated Group by more
than two percentage points (or the lesser percentage
permitted by the multiple use limitation in Section 14.10)
and the ACP for the Highly Compensated Group is not more
than twice the ACP for the Nonhighly Compensated Group.
(A) Calculation of ACP. The average contribution percentage for
a group is the average of the separate contribution percentages
calculated for each Eligible Employee who is a member of that
group. An Eligible Employee's contribution percentage for a Plan
Year is the ratio of the Eligible Employee's aggregate
contributions for the Plan Year to the Employee's Compensation
for the Plan Year. "Aggregate contributions" are Employer
matching contributions (other than qualified matching
contributions used in the ADP test under Section 14.08) and
employee contributions (as defined in Section 14.03). For
aggregated family members treated as a single Highly Compensated
Employee, the contribution percentage of the family unit is the
contribution percentage determined by combining the aggregate
contributions and Compensation of all aggregated family members.
The Advisory Committee, in a manner consistent with Treasury
regulations, may determine the contribution percentages of the
Eligible Employees by taking into account qualified nonelective
contributions (other than qualified nonelective contributions
used in the ADP test under Section 14.08) or elective deferrals,
or both, made to this Plan or to any other qualified Plan
maintained by the Employer. The Advisory Committee may not
include qualified nonelective contributions in the ACP test
unless the allocation of nonelective contributions is
nondiscriminatory when the Advisory Committee takes into account
all nonelective contributions (including the qualified
nonelective contributions) and also when the Advisory Committee
takes into account only the nonelective contributions not used in
either the ADP test described in Section 14.08 or the ACP test
described in this Section 14.09. The Advisory Committee may not
include elective deferrals in the ACP test, unless the Plan which
includes the elective deferrals satisfies the ADP test both with
and without the elective deferrals included in this ACP test. For
Plan Years beginning after December 31, 1989, the Advisory
Committee may not include in the ACP test any qualified
nonelective contributions or elective deferrals under another
qualified plan unless that plan has the same plan year as this
Plan. The Advisory Committee must maintain records to demonstrate
compliance with the ACP test, including the extent to which the
Plan used qualified nonelective contributions or elective
deferrals to satisfy the test. For Plan Years beginning prior to
January 1, 1992, the component group testing rule permitted under
Section 14.08(A) also applies to the ACP test under this Section
14.09.
(B) Special aggregation rule for Highly Compensated Employees.
To determine the contribution percentage of any Highly
Compensated Employee, the aggregate contributions taken into
account must include any matching contributions (other than
qualified matching contributions used in the ADP test) and any
Employee contributions made on his behalf to any other plan
maintained by the Employer, unless the other plan is an ESOP. If
the plans have different plan years, the Advisory Committee will
determine the combined aggregate contributions on the basis of
the plan years ending in the same calendar year.
(C) Aggregation of certain plans. If the Employer treats two
plans as a unit for coverage or nondiscrimination purposes, the
Employer must combine the plans to determine whether either plan
satisfies the ACP test. This aggregation rule applies to the
contribution percentage determination for all Eligible Employees,
irrespective of whether an Eligible Employee is a Highly
Compensated Employee or a Nonhighly Compensated Employee. For
Plan Years beginning after December 31, 1989, an aggregation of
plans under this paragraph does not apply to plans which have
different plan years and, for Plan Years beginning after December
31, 1988, the Advisory Committee may not aggregate an ESOP (or
the ESOP portion of a plan) with a non-ESOP plan (or non-ESOP
portion of a plan).
(D) Distribution of excess aggregate contributions. The Advisory
Committee will determine excess aggregate contributions after
determining excess deferrals under Section 14.07 and excess
contributions under Section 14.08. If the Advisory Committee
determines the Plan fails to satisfy the ACP test for a Plan
Year, it must distribute the excess aggregate contributions, as
adjusted for allocable income, during the next Plan Year.
However, the Employer will incur an excise tax equal to 10% of
the amount of excess aggregate contributions for a Plan Year not
distributed to the appropriate Highly Compensated Employees
during the first 2 1/2 months of that next Plan Year. The excess
aggregate contributions are the amount of aggregate contributions
allocated on behalf of the Highly Compensated Employees which
causes the Plan to fail to satisfy the ACP test. The Advisory
Committee will distribute to each Highly Compensated Employee his
respective share of the excess aggregate contributions. The
Advisory Committee will determine the respective shares of excess
aggregate contributions by starting with the Highly Compensated
Employee(s) who has the greatest contribution percentage,
reducing his contribution percentage (but not below the next
highest contribution percentage), then, if necessary, reducing
the contribution percentage of the Highly Compensated Employee(s)
at the next highest contribution percentage level (including the
contribution percentage of the Highly Compensated Employee(s)
whose contribution percentage the Advisory Committee already has
reduced), and continuing in this manner until the ACP for the
Highly Compensated Group satisfies the ACP test. If the Highly
Compensated Employee is part of an aggregated family group, the
Advisory Committee, in accordance with the applicable Treasury
regulations, will determine each aggregated family member's
allocable share of the excess aggregate contributions assigned to
the family unit.
(E) Allocable income. To determine the amount of the corrective
distribution required under this Section 14.09, the Advisory
Committee must calculate the allocable income for the Plan Year
in which the excess aggregate contributions arose. "Allocable
income" means net income or net loss. The Advisory Committee will
determine allocable income in the same manner as described in
Section 14.08(F) for excess contributions.
(F) Characterization of excess aggregate contributions. The
Advisory Committee will treat a Highly Compensated Employee's
allocable share of excess aggregate contributions in the
following priority: (1) first as attributable to his Employee
contributions which are voluntary contributions, if any; (2) then
as matching contributions allocable with respect to excess
contributions determined under the ADP test described in Section
14.08; (3) then on a pro rata basis to matching contributions and
to the deferral contributions relating to those matching
contributions which the Advisory Committee has included in the
ACP test; (4) then on a pro rata basis to Employee contributions
which are mandatory contributions, if any, and to the matching
contributions allocated on the basis of those mandatory
contributions; and (5) last to qualified nonelective
contributions used in the ACP test. To the extent the Highly
Compensated Employee's excess aggregate contributions are
attributable to matching contributions, and he is not 100% vested
in his Accrued Benefit attributable to matching contributions,
the Advisory Committee will distribute only the vested portion
and forfeit the nonvested portion. The vested portion of the
Highly Compensated Employee's excess aggregate contributions
attributable to Employer matching contributions is the total
amount of such excess aggregate contributions (as adjusted for
allocable income) multiplied by his vested percentage (determined
as of the last day of the Plan Year for which the Employer made
the matching contribution). The Employer will specify in Adoption
Agreement Section 3.05 the manner in which the Plan will allocate
forfeited excess aggregate contributions.
14.10 MULTIPLE USE LIMITATION. For Plan Years beginning
after December 31, 1988, if at least one Highly Compensated
Employee is includible in the ADP test under Section 14.08 and in
the ACP test under Section 14.09, the sum of the Highly
Compensated Group's ADP and ACP may not exceed the multiple use
limitation.
The multiple use limitation is the sum of (i) and (ii):
(i) 125% of the greater of: (a) the ADP of the Nonhighly
Compensated Group under the Code Sect.401(k) arrangement; or
(b) the ACP of the Nonhighly Compensated Group for the Plan
Year beginning with or within the Plan Year of the Code
Sect.401(k) arrangement.
(ii) 2% plus the lesser of (i)(a) or (i)(b), but no more
than twice the lesser of (i)(a) or (i)(b).
The Advisory Committee, in lieu of determining the multiple
use limitation as the sum of (i) and (ii), may elect to determine
the multiple use limitation as the sum of (iii) and (iv):
(iii) 125% of the lesser of: (a) the ADP of the
Nonhighly Compensated Group under the Code Sect.401(k)
arrangement; or (b) the ACP of the Nonhighly Compensated
Group for the Plan Year beginning with or within the Plan
Year of the Code Sect.401(k) arrangement.
(iv) 2% plus the greater of (iii)(a) or (iii)(b), but no
more than twice the greater of (iii)(a) or (iii)(b).
The Advisory Committee will determine whether the Plan
satisfies the multiple use limitation after applying the ADP test
under Section 14.08 and the ACP test under Section 14.09 and
after making any corrective distributions required by those
Sections. If, after applying this Section 14.10, the Advisory
Committee determines the Plan has failed to satisfy the multiple
use limitation, the Advisory Committee will correct the failure
by treating the excess amount as excess contributions under
Section 14.08 or as excess aggregate contributions under Section
14.09, as it determines in its sole discretion. This Section
14.10 does not apply unless, prior to application of the multiple
use limitation, the ADP and the ACP of the Highly Compensated
Group each exceeds 125% of the respective percentages for the
Nonhighly Compensated Group.
14.11 DISTRIBUTION RESTRICTIONS. The Employer must elect in
Section 6.03 the Adoption Agreement the distribution events
permitted under the Plan. The distribution events applicable to
the Participant's Deferral Contributions Account, Qualified
Nonelective Contributions Account and Qualified Matching
Contributions Account must satisfy the distribution restrictions
described in paragraph (m) of Section 14.03.
(A) Hardship distributions from Deferral Contributions Account.
The Employer must elect in Adoption Agreement Section 6.03
whether a Participant may receive hardship distributions from his
Deferral Contributions Account prior to the Participant's
Separation from Service. Hardship distributions from the Deferral
Contributions Account must satisfy the requirements of this
Section 14.11. A hardship distribution option may not apply to
the Participant's Qualified Nonelective Contributions Account or
Qualified Matching Contributions Account, except as provided in
paragraph (3).
(1) Definition of hardship. A hardship distribution under
this Section 14.11 must be on account of one or more of the
following immediate and heavy financial needs: (1) medical care
described in Code Sect.213(d) incurred by the Participant, by the
Participant's spouse, or by any of the Participant's dependents,
or necessary to obtain such medical care; (2) the purchase
(excluding mortgage payments) of a principal residence for the
Participant; (3) the payment of post-secondary education tuition
and related educational fees, for the next 12-month period, for
the Participant, for the Participant's spouse, or for any of the
Participant's dependents (as defined in Code Sect.152); (4) to
prevent the eviction of the Participant from his principal
residence or the foreclosure on the mortgage of the Participant's
principal residence; or (5) any need prescribed by the Revenue
Service in a revenue ruling, notice or other document of general
applicability which satisfies the safe harbor definition of
hardship.
(2) Restrictions. The following restrictions apply to a
Participant who receives a hardship distribution: (a) the
Participant may not make elective deferrals or employee
contributions to the Plan for the 12-month period following the
date of his hardship distribution; (b) the distribution is not in
excess of the amount of the immediate and heavy financial need
(including any amounts necessary to pay any federal, state or
local income taxes or penalties reasonably anticipated to result
from the distribution); (c) the Participant must have obtained
all distributions, other than hardship distributions, and all
nontaxable loans (determined at the time of the loan) currently
available under this Plan and all other qualified plans
maintained by the Employer; and (d) the Participant agrees to
limit elective deferrals under this Plan and under any other
qualified Plan maintained by the Employer, for the Participant's
taxable year immediately following the taxable year of the
hardship distribution, to the 402(g) limitation (as described in
Section 14.07), reduced by the amount of the Participant's
elective deferrals made in the taxable year of the hardship
distribution. The suspension of elective deferrals and employee
contributions described in clause (a) also must apply to all
other qualified plans and to all nonqualified plans of deferred
compensation maintained by the Employer, other than any mandatory
employee contribution portion of a defined benefit plan,
including stock option, stock purchase and other similar plans,
but not including health or welfare benefit plans (other than the
cash or deferred arrangement portion of a cafeteria plan).
(3) Earnings. For Plan Years beginning after December 31,
1988, a hardship distribution under this Section 14.11 may not
include earnings on an Employee's elective deferrals credited
after December 31, 1988. Qualified matching contributions and
qualified nonelective contributions, and any earnings on such
contributions, credited as of December 31, 1988, are subject to
the hardship withdrawal only if the Employer specifies in an
addendum to this Section 14.11. The addendum may modify the
December 31, 1988, date for purposes of determining credited
amounts provided the date is not later than the end of the last
Plan Year ending before July 1, 1989.
(B) Distributions after Separation from Service. Following the
Participant's Separation from Service, the distribution events
applicable to the Participant apply equally to all of the
Participant's Accounts, except as elected in Section 6.03 of the
Employer's Adoption Agreement.
(C) Correction of Annual Additions Limitation. If, as a result
of a reasonable error in determining the amount of elective
deferrals an Employee may make without violating the limitations
of Part 2 of Article III, an Excess Amount results, the Advisory
Committee will return the Excess Amount (as adjusted for
allocable income) attributable to the elective deferrals. The
Advisory Committee will make this distribution before taking any
corrective steps pursuant to Section 3.10 or to Section 3.16. The
Advisory Committee will disregard any elective deferrals returned
under this Section 14.11(C) for purposes of Sections 14.07, 14.08
and 14.09.
14.12 SPECIAL ALLOCATION RULES. If the Code Sect.401(k)
arrangement provides for salary reduction contributions, if the
Plan accepts Employee contributions, pursuant to Adoption
Agreement Section 4.01, or if the Plan allocates matching
contributions as of any date other than the last day of the Plan
Year, the Employer must elect in Adoption Agreement 9.11 whether
any special allocation provisions will apply under Section 9.11
of the Plan. For purposes of the elections:
(a) A "segregated Account" direction means the Advisory
Committee will establish a segregated Account for the
applicable contributions made on the Participant's behalf
during the Plan Year. The Trustee must invest the segregated
Account in Federally insured interest bearing savings
account(s) or time deposits, or a combination of both, or in
any other fixed income investments, unless otherwise
specified in the Employer's Adoption Agreement. As of the
last day of each Plan Year (or, if earlier, an allocation
date coinciding with a valuation date described in Section
9.11), the Advisory Committee will reallocate the segregated
Account to the Participant's appropriate Account, in
accordance with Section 3.04 or Section 4.06, whichever
applies to the contributions.
(b) A "weighted average allocation" method will treat a
weighted portion of the applicable contributions as if
includible in the Participant's Account as of the beginning
of the valuation period. The weighted portion is a fraction,
the numerator of which is the number of months in the
valuation period, excluding each month in the valuation
period which begins prior to the contribution date of the
applicable contributions, and the denominator of which is
the number of months in the valuation period. The Employer
may elect in its Adoption Agreement to substitute a
weighting period other than months for purposes of this
weighted average allocation.
* * * * * * * * * * * * * * *
ARTICLE A
APPENDIX TO PLAN AND TRUST AGREEMENT
This Article is necessary to comply with the Unemployment
Compensation Amendments Act of 1992 and is an integral part of
the basic plan document. Section 12.08 applies to any
modification or amendment of this Article.
A-1. APPLICATIONS. This Article applies to distributions
made on or after January 1, 1993. Notwithstanding any provision
of the Plan to the contrary that would otherwise limit a
distributee's election under this Article, a distributee may
elect, at the time and in the manner prescribed by the Plan
Administrator, to have any portion of an eligible rollover
distribution paid directly to an eligible retirement plan
specified by the distributee in a direct rollover.
A-2. DEFINITIONS.
(a) "Eligible rollover distribution." An eligible rollover
distribution is any distribution of all or any portion of the
balance to the credit of the distributee, except that an eligible
rollover distribution does not include: any distribution that is
one of a series of substantially equal periodic payments (not
less frequently than annually) made for the life (or life
expectancy) of the distributee or the joint lives (or joint life
expectancies) of the distributee and the distributee's designated
beneficiary, or for a specified period of ten years or more; any
distribution to the extent such distribution is required under
Code Sect.401(a)(9); and the portion of any distribution that is
not includible in gross income (determined without regard to the
exclusion of net unrealized appreciation with respect to employer
securities).
(b) "Eligible retirement plan." An eligible retirement plan
is an individual retirement account described in Code
Sect.408(a), an individual retirement annuity described in Code
Sect.408(b), an annuity plan described in Code Sect.403(a), or a
qualified trust described in Code Sect.401(a), that accepts the
distributee's eligible rollover distribution. However, in the
case of an eligible rollover distribution to the surviving
spouse, an eligible retirement plan is an individual retirement
account or individual retirement annuity.
(c) "Distributee." A distributee includes an Employee or
former Employee. In addition, the Employee's or former
Employee's surviving spouse and the Employee's or former
Employee's spouse or former spouse who is the alternate payee
under a qualified domestic relations order, as defined in Code
Sect.414(p), are distributees with regard to the interest of the
spouse or former spouse.
(d) "Direct rollover." A direct rollover is a payment by
the Plan to the eligible retirement plan specified by the
distributee.
ADOPTION AGREEMENT #011
NONSTANDARDIZED CODE Sect.401(k) PROFIT SHARING PLAN
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS . . . . . . . . . . . 1
1.02 TRUSTEE . . . . . . . . . . . . . . . . . . . . . . 1
1.03 PLAN . . . . . . . . . . . . . . . . . . . . . . . 1
1.07 EMPLOYEE . . . . . . . . . . . . . . . . . . . . . 1
Leased Employees . . . . . . . . . . . . . . . . . 2
Related Employers . . . . . . . . . . . . . . . . . 2
1.12 COMPENSATION . . . . . . . . . . . . . . . . . . . 2
Treatment of elective contributions . . . . . . . . 2
Modifications to Compensation definition . . . . . 2
Special definition for matching contributions . . . 3
Special definition for salary reduction
contributions . . . . . . . . . . . . . . . . 3
1.17 PLAN YEAR/LIMITATION YEAR . . . . . . . . . . . . . 3
Plan Year . . . . . . . . . . . . . . . . . . . . . 3
Limitation Year . . . . . . . . . . . . . . . . . . 4
1.18 EFFECTIVE DATE . . . . . . . . . . . . . . . . . . 4
New Plan . . . . . . . . . . . . . . . . . . . . . 4
Restated Plan . . . . . . . . . . . . . . . . . . . 4
1.27 HOUR OF SERVICE . . . . . . . . . . . . . . . . . . 4
1.29 SERVICE FOR PREDECESSOR EMPLOYER . . . . . . . . . 4
1.31 LEASED EMPLOYEES . . . . . . . . . . . . . . . . . 5
ARTICLE II
EMPLOYEE PARTICIPANTS . . . . . . . . . 5
2.01 ELIGIBILITY . . . . . . . . . . . . . . . . . . . . 5
Eligibility conditions . . . . . . . . . . . . . . 5
Plan Entry Date . . . . . . . . . . . . . . . . . . 6
Time of Participation . . . . . . . . . . . . . . . 6
Dual eligibility . . . . . . . . . . . . . . . . . 7
2.02 YEAR OF SERVICE - PARTICIPATION . . . . . . . . . 7
Hours of Service . . . . . . . . . . . . . . . . . 7
Eligibility computation period . . . . . . . . . . 8
2.03 BREAK IN SERVICE - PARTICIPATION . . . . . . . . . 8
2.06 ELECTION NOT TO PARTICIPATE . . . . . . . . . . . 8
ARTICLE III
EMPLOYER CONTRIBUTIONS AND FORFEITURES . . . . 8
3.01 AMOUNT . . . . . . . . . . . . . . . . . . . . . . 8
Part I. [Options (a) through (g)] Amount of
Employer's contribution . . . . . . . . . . . 8
Deferral contributions (Code Sect.401(k)
arrangement) . . . . . . . . . . . . . . 9
Matching contributions . . . . . . . . . . . . 9
Designated qualified nonelective
contributions . . . . . . . . . . . . . . 9
Nonelective contributions . . . . . . . . . . 9
Frozen Plan . . . . . . . . . . . . . . . . . 10
Net Profits . . . . . . . . . . . . . . . . . . . . 10
II-i
Part II. [Options (h) through (j)] Matching
contribution formula . . . . . . . . . . . . . 11
Amount of matching contributions . . . . . . . 11
Related Employers . . . . . . . . . . . . . . . . . 11
Definition of eligible contributions . . . . . 12
amount of eligible contributions taken into
account . . . . . . . . . . . . . . . . . 12
Part III. [Options (i) and (l)]. special rules
for Code Sect.401(k) Arrangement . . . . . . . 12
Salary Reduction Agreements . . . . . . . . . 12
Cash or deferred contributions . . . . . . . . 14
3.04 CONTRIBUTION ALLOCATION . . . . . . . . . . . . . . 14
Part I. [Options (a) through (d)]. Special
Accounting elections . . . . . . . . . . . . . 14
Matching Contributions Account . . . . . . . . 14
Special Allocation Dates for Salary Reduction
Contributions . . . . . . . . . . . . . . 14
Special Allocation Dates for Matching
Contributions . . . . . . . . . . . . . . 14
Designated Qualified Nonelective
Contributions Definitions of
Participant . . . . . . . . . . . . . . . 15
Part II. Method of Allocation Nonelective
Contribution . . . . . . . . . . . . . . . . . 15
Nonintegrated Allocation Formula . . . . . . . 15
Three-Tiered Integrated Allocation Formula . . 16
Four-Tiered Integrated Allocation Formula . . 16
Excess Compensation . . . . . . . . . . . . . 17
Maximum Disparity Table . . . . . . . . . . . . . . 17
Allocation offset . . . . . . . . . . . . . . 17
Top Heavy Minimum Allocation Method of
Compliance . . . . . . . . . . . . . . . . . . 18
Related employers . . . . . . . . . . . . . . . . . 18
3.05 FORFEITURE ALLOCATION . . . . . . . . . . . . . . . 18
Allocation of forfeited excess aggregate
contributions . . . . . . . . . . . . . . . . 19
3.06 ACCRUAL OF BENEFIT . . . . . . . . . . . . . . . . 20
Compensation taken into account . . . . . . . . . . 20
Accrual Requirements . . . . . . . . . . . . . . . 20
Safe harbor rule . . . . . . . . . . . . . . . 20
Hours of Service condition . . . . . . . . . . 20
Employment condition . . . . . . . . . . . . . 21
Suspension of Accrual Requirements . . . . . . . . 21
Special accrual requirements for matching
contributions . . . . . . . . . . . . . . . . 21
3.15 MORE THAN ONE PLAN LIMITATION . . . . . . . . . . 22
3.18 DEFINED BENEFIT PLAN LIMITATION . . . . . . . . . 22
Application of limitation . . . . . . . . . . . . . 22
Coordination with top heavy minimum allocation . . 23
Actuarial Assumptions for Top Heavy Calculation . . 23
ARTICLE IV
II-ii
PARTICIPANT CONTRIBUTIONS . . . . . . . . 24
4.01 PARTICIPANT NONDEDUCTIBLE CONTRIBUTIONS . . . . . 24
Allocation Dates . . . . . . . . . . . . . . . . . 24
4.05 PARTICIPANT CONTRIBUTION -
WITHDRAWAL/DISTRIBUTION . . . . . . . . . . . . . 24
ARTICLE V
TERMINATION OF SERVICE - PARTICIPANT VESTING . . . 25
5.01 NORMAL RETIREMENT . . . . . . . . . . . . . . . . 25
5.02 PARTICIPANT DEATH OR DISABILITY . . . . . . . . . 25
5.03 VESTING SCHEDULE . . . . . . . . . . . . . . . . . 25
Deferral Contributions Account/Qualified Matching
Contributions Account/Qualified Nonelective
Contributions Account/Mandatory Contributions
Account . . . . . . . . . . . . . . . . . . . 26
Regular Matching Contributions Account/Employer
Contributions Account . . . . . . . . . . . . 26
Minimum vesting . . . . . . . . . . . . . . . . . . 27
Life Insurance Investments . . . . . . . . . . . . 27
5.04 CASH-OUT DISTRIBUTIONS TO PARTIALLY-VESTED
PARTICIPANTS/ RESTORATION OF FORFEITED ACCRUED
BENEFIT . . . . . . . . . . . . . . . . . . . . . . 27
5.06 YEAR OF SERVICE - VESTING . . . . . . . . . . . . 27
Vesting computation period . . . . . . . . . . . . 27
Hours of Service . . . . . . . . . . . . . . . . . 28
5.08 INCLUDED YEARS OF SERVICE - VESTING . . . . . . . 28
ARTICLE VI
TIME AND METHOD OF PAYMENTS OF BENEFITS . . . . 28
Code Sect.411(d)(6) Protected Benefits . . . . . . 28
6.01 TIME OF PAYMENT OF ACCRUED BENEFIT . . . . . . . . 29
Distribution date . . . . . . . . . . . . . . . . . 29
Nonforfeitable Accrued Benefit Not Exceeding
$3,500 . . . . . . . . . . . . . . . . . . . . 29
Nonforfeitable Accrued Benefit Exceeds $3,500 . . . 29
Disability . . . . . . . . . . . . . . . . . . . . 29
Hardship . . . . . . . . . . . . . . . . . . . . . 29
Default on a Loan . . . . . . . . . . . . . . . . . 30
6.02 METHOD OF PAYMENT OF ACCRUED BENEFIT . . . . . . . 30
6.03 BENEFIT PAYMENT ELECTIONS . . . . . . . . . . . . 31
Participant Elections After Separation from
Service . . . . . . . . . . . . . . . . . . . 31
Participant Elections Prior to Separation from
Service - Regular Matching Contributions
Account and Employer Contributions Account . . 32
Participant Elections Prior to Separation from
Service - Deferral Contributions Account,
Qualified Matching Contributions Account and
Qualified Nonelective Contributions Account . 33
Sale of trade or business/subsidiary . . . . . . . 33
6.04 ANNUITY DISTRIBUTIONS TO PARTICIPANTS AND
SURVIVING SPOUSES . . . . . . . . . . . . . . . . . 34
II-iii
ARTICLE IX
ADVISORY COMMITTEE - DUTIES WITH
RESPECT TO PARTICIPANTS' ACCOUNTS . . . . . . . . . . . . . . 34
9.01 VALUE OF PARTICIPANT'S ACCRUED BENEFIT . . . . . . 34
9.11 ALLOCATION AND DISTRIBUTION OF NET INCOME GAIN OR
LOSS . . . . . . . . . . . . . . . . . . . . . . . 34
ARTICLE X
TRUSTEE AND CUSTODIAN, POWERS AND DUTIES . . . . 35
10.03 INVESTMENT POWERS . . . . . . . . . . . . . . . . 36
10.14 VALUATION OF TRUST . . . . . . . . . . . . . . . 36
II-iv
ADOPTION AGREEMENT #011
NONSTANDARDIZED CODE Sect.401(k) PROFIT SHARING PLAN
The undersigned, Kirby Marine Transportation Corporation
("Employer"), by executing this Adoption Agreement, elects to
become a participating Employer in the Texas Commerce National
Association Defined Contribution Master Plan (basic plan document
#03) by adopting the accompanying Plan and Trust in full as if
the Employer were a signature to that Agreement. The Employer
makes the following elections granted under the provisions of the
Master Plan.
ARTICLE I
DEFINITIONS
1.02 TRUSTEE. The Trustee executing this Adoption Agreement
is: (Choose (a) or (b))
[ ] (a) A discretionary Trustee. See Section 10.03[A] of the
Plan.
[x] b) A nondiscretionary Trustee. See Section 10.03[B] of
the Plan. [Note: The Employer may not elect Option (b) if
a Custodian executes the Adoption Agreement.]
1.03 PLAN. The name of the Plan as adopted by the Employer
is Kirby 401(k) Plan.
1.07 EMPLOYEE. The following Employees are not eligible to
participate in the Plan: (Choose (a) or at lease one of (b)
through (g)).
[ ] (a) No exclusions.
[x] (b) Collective bargaining employees (as defined in Section
1.07 of the Plan). [Note: If the Employer excludes union
employees from the Plan, the Employer must be able to
provide evidence that retirement benefits were the subject
of good faith bargaining.]
[ ] (c) Nonresident aliens who do not receive any earned income
(as defined in Code Sect.911(d)(2)) from the Employer which
constitutes United States source income (as defined in Code
Sect.861(a)(3)).
[ ] (d) Commission Salesmen.
[ ] (e) Any Employee compensated on a salaried basis.
[ ] (f) Any Employee compensated on an hourly basis.
[x] (g) (Specify) any employee who has never completed 1000
hours of service in a Plan year.
Leased Employees. Any Leased Employee treated as an Employee
under Section 1.31 of the Plan, is: Choose (h) or (i)).
[x] (h) Not eligible to participate in the Plan.
[ ] (i) Eligible to participate in the Plan, unless excluded by
reason of exclusion classification elected under this
Adoption Agreement Section 1.07.
Related Employers. If any member of the Employer's related group
(as defined in Section 1.30 of the Plan executes a Participation
Agreement to this Adoption Agreement, such member's Employees are
eligible to participate in this Plan, unless excluded by reason
of an exclusion classification elected under this Adoption
Agreement Section 1.07. In addition: (Choose (j) or (k)).
[x] (j) No other related group member's Employees are eligible
to participate in the Plan.
[ ] (k) The following nonparticipating related group member's
Employees are eligible to participate in the Plan unless
excluded by reason of an exclusion classification elected
under this Adoption Agreement Section 1.07: .
1.12 COMPENSATION.
Treatment of elective contributions (Choose (a) or (b))
[x] (a) "Compensation: includes elective contributions made by
the Employer on the Employee's behalf.
[ ] (b) "Compensation" does not include elective contributions.
Modifications to Compensation definition. (Choose (c) or at
lease one of (d) through (j))
[ ] (c) No modifications other than as elected under Options
(a) or (b).
[ ] (d) The Plan excludes Compensation in excess of
$__________.
[ ] (e) In lieu of the definition in Section 1.12 of the Plan,
Compensation means any earnings reportable as W-2 wages for
Federal income tax withholding purposes, subject to any
other election under this Adoption Agreement Section 1.12.
[x] (f) The Plan excludes bonuses.
[x] (g) The Plan excludes overtime.
[x] (h) The Plan excludes Commissions.
II-2
[ ] (i) Compensation will not include Compensation from a
related employer (as defined in Section 1.30 of the Plan)
that has not executed a Participation Agreement in this Plan
unless, pursuant to Adoption Agreement Section 1.07, the
Employees of that related employer are eligible to
participate in this Plan.
[ ] (j) (Specify)
.
If, for any Plan Year, the Plan uses permitted disparity in the
contribution or allocation formula elected under Article III, any
election of Options (f), (g), (h) or (j) is ineffective for such
Plan Year with respect to any Nonhighly Compensated Employee.
Special definition for matching contributions. "Compensation"
for purposes of any matching contribution formula under Article
III means: (Choose (k) or (l) only if applicable).
[x] (k) Compensation as defined in this Adoption Agreement
Section 1.12.
[ ] (l) (Specify) .
Special definition for salary reduction contributions. An
Employee's salary reduction ________ __________ to his
Compensation determined prior to the reduction authorized by that
salary reduction agreement, with the following exceptions:
(Choose (m) or at lease one of (n) or (o), if applicable)
[x] (m) No exceptions.
[ ] (n) If the Employee makes elective contributions to another
plan maintained by the Employer, the Advisory Committee will
determine the amount of the Employee's salary reduction
contribution for the withholding period: (Choose (1) or
(2))
[ ] (1) After the reduction for such period of elective
contributions to the other plan(s).
[ ] (2) Prior to the reduction for such period of elective
contributions to the other plan(s).
[ ] (o) (Specify) .
1.17 PLAN YEAR/LIMITATION YEAR.
Plan Year. Plan Year means: (Choose (a) or (b))
[x] (a) The 12 consecutive month period ending every December
31.
II-3
[ ] (b) (Specify) .
Limitation Year. The Limitation Year is: (Choose (c) or (d))
[x] (c) The Plan Year.
[ ] (d) The 12 consecutive month period ending every ____.
1.18 EFFECTIVE DATE.
New Plan. The "Effective Date" of the Plan is __________.
Restated Plan. The restated Effective Date is January 1, 1995.
This Plan is a substitution and amendment of an existing
retirement plan(s) originally established January 1, 1986.
[Note: See the Effective Date Addendum.]
1.27 HOUR OF SERVICE. The crediting method for Hours of
Service is: (Choose (a) or (b))
[x] (a) The actual method.
[ ] (b) The equivalency method, except:
[ ] (1) No exceptions.
[ ] (2) The actual method applies for purposes of: (Choose
at least one)
[ ] (i) Participation under Article II
[ ] (ii) Vesting under Article V.
[ ] (iii) Accrual of benefits under Section 3.06.
[Note: On the blank line, insert "daily," "weekly," "semi-
monthly payroll periods" or "monthly."]
1.29 SERVICE FOR PREDECESSOR EMPLOYER. In addition to the
predecessor service the Plan must credit by reason of Section
1.29 of the Plan, the Plan credits Service with the following
predecessor employer(s): N/A. Service with the designated
predecessor employer(s) applies: (Choose at lease one of (a) or
(b); (c) is available only in addition to (a) or (b))
[N/A] (a) For purposes of participation under Article II.
[N/A] (b) For purposes of vesting under Article V.
[N/A] (c) Except the following Service: .
II-4
[Note: If the Plan does not credit any predecessor service under
this provision, insert "N/A" in the first blank line. The
Employer may attache a schedule to this Adoption Agreement, in
the same format as this Section 1.29, designating additional
predecessor employers and the applicable service crediting
elections.]
1.31 LEASED EMPLOYEES. If a Leased Employee is a
Participate in the Plan and also participates in a plan
maintained by the leasing organization: (Choose (a) or (b))
[N/A] (a) The Advisory Committee will determine the Leased
Employee's allocation of Employer contributions under
Article III without taking into account the Leased
Employee's allocation, if any, under the leasing
organization's plan.
[N/A] (b) The Advisory Committee will reduce a Leased
Employee's allocation of Employer nonelective
contributions (other than designated qualified
nonelective contributions) under this Plan by the
Leased Employee's allocation under the leasing
organization's plan, but only to the extend that
allocation is attributable to the Leased Employee's
service provided to the Employer. The leasing
organization's plan:
[ ] (1) Must be a money purchase plan which would satisfy
the definition under Section 1.31 of a safe harbor
plan, irrespective of whether the safe harbor exception
applies.
[ ] (2) Must satisfy the features and, if a defined
benefit plan, the method of reduction described in an
addendum to this Adoption Agreement, numbered 1.31.
ARTICLE II
EMPLOYEE PARTICIPANTS
2.01 ELIGIBILITY.
Eligibility conditions. To become a Participant in the Plan, an
Employee must satisfy the following eligibility conditions:
(Choose (a) or (b) or both; (c) is optional as an additional
election)
[x] (a) Attainment of age 18 (specify age, not exceeding 21).
[x] (b) Service requirement. (Choose one of (1) through (3))
[x] (1) One year of Service.
II-5
[ ] (2) __ months (not exceeding 12) following the
Employee's Employment Commencement Date.
[ ] (3) One Hour of Service.
[ ] (c) Special requirements for non-401(k) portion of plan.
(Make elections under (1) and under (2))
(1) The requirements of this Option (c) apply to
participation in: (Choose at lease one of (i) through
(iii))
[ ] (i) The allocation of Employer nonelective
contributions and Participant forfeitures.
[ ] (ii) The allocation of Employer matching
contributions (including forfeitures allocated as
matching contributions).
[ ] (iii) The allocation of Employer qualified
nonelective contributions.
(2) For participation in the allocations described in (1),
the eligibility conditions are: (Choose at lease one
of (i) through (iv))
[ ] (i) (one or two) Years(s) of Service, without an
intervening Break in Service (as described in
Section 2.03(A) of the Plan ) if the requirement
is two Years of Service.
[ ] (ii) ____ months (not exceeding 24) following the
Employees's Employment Commencement Date.
[ ] (iii) One Hour of Service.
[ ] (iv) Attainment of age ____ (Specify age, not
exceeding 21).
Plan Entry Date. "Plan Entry Date" means the Effective Date and:
(Choose (d), (e) or (f))
[ ] (d) Semi-annual Entry Dates. The first day of the Plan
Year and the first day of the seventh month of the Plan
Year.
[ ] (e) The first day of the Plan Year.
[x] (f) (Specify entry dates) The first day of each Plan
quarter.
II-6
Time of Participation. An Employee will become a Participant
(and, if applicable, will participate in the allocations
described in Option (c)(1)), unless excluded under Adoption
Agreement Section 1.07, on the Plan Entry Date (if employed on
that date): (Choose (g), (h) or (i))
[x] (g) immediately following
[ ] (h) immediately preceding
[ ] (i) nearest
the date the Employee completes the eligibility conditions
described in Options (a) and (b) (or in Option (c)(2) if
applicable) of this Adoption Agreement Section 2.01. [Note: The
Employer must coordinate the selection of (g), (h) or (i) with
the "Plan Entry Date" selection in (d), (e) or (f). Unless
otherwise excluded under Section 1.07, the Employee must become a
Participant by the earlier of: (1) the first day of the Plan
Year beginning after the date the Employee completes the age and
service requirements of Code Sect.410(a); or (2) 6 months after
the date the Employee completes those requirements.]
Dual eligibility. The eligibility conditions of this Section
2.01 apply to: (Choose (j) or (k))
[x] (j) All Employees of the Employer, except: (Choose (1) or
(2))
[x] (1) No exceptions.
[ ] (2) Employees who are Participants in the Plan as of
the Effective Date.
[ ] (k) Solely to an Employee employed by the Employer after
__________. If the Employee was employed by the Employer on
or before the specified date, the Employee will become a
Participant: (Choose (1), (2) or (3))
[ ] (1) On the latest of the Effective Date, his
Employment Commencement Date or the date he attains age
____ (not to exceed 21).
[ ] (2) Under the eligibility conditions in effect under
the Plan prior to the restated Effective Date. If the
restated Plan required more than one Year of Service to
participate, the eligibility condition under this
Option (2) for participation in the Code Sect.401(k)
arrangement under this Plan is one Year of Service for
Plan Years beginning after December 31, 1988. [For
restated plans only]
II-7
[ ] (3) (Specify)
2.02 YEAR OF SERVICE - PARTICIPATION.
Hours of Service. An Employee must complete: (Choose (a) or
(b))
[x] (a) 1,000 Hours of Service
[ ] (b) ____ Hours of Service
during an eligibility computation period to receive credit for a
Year of Service. [Note: The Hours of Service requirement may
not exceed 1,000.]
Eligibility computation period. After the initial eligibility
computation period described in Section 2.02 of the Plan, the
Plan measures the eligibility computation period as: (Choose (c)
or (d))
[ ] (c) The 12 consecutive month period beginning with each
anniversary of an Employee's Employment Commencement Date.
[x] (d) The Plan Year, beginning with the Plan Year which
includes the first anniversary of the Employee's Employment
Commencement Date.
2.03 BREAK IN SERVICE - PARTICIPATION. The Break in
Service rule described in Section 2.03(B) of the Plan: (Choose
(a) or (b))
[x] (a) Does not apply to the Employer's Plan
[ ] (b) Applies to the Employer's Plan
2.06 ELECTION NOT TO PARTICIPATE. The Plan (Choose (a) or
(b)
[x] (a) Does not permit an eligible Employee or a Participant
to elect not to participate.
[ ] (b) Does permit an eligible Employee or a Participant to
elect not to participate in accordance with Section 2.06 and
with the following rules: (Complete (1), (2), (3) and (4))
(1) An election is effective for a Plan Year if filed no
later than .
(2) An election not to participate must be effective for at
lease ____ Plan Year(s).
II-8
(3) Following a re-election to participate, the Employee or
Participant:
[ ] (i) May not again elect not to participate for any
subsequent Plan Year.
[ ] (ii) May again elect not to participate, but not
earlier than the _____ Plan Year following the Plan
Year in which the re-election first was effective.
(4) (Specify) [Insert "N/A" if no other rules apply].
ARTICLE III
EMPLOYER CONTRIBUTIONS AND FORFEITURES
3.01 AMOUNT.
Part I. [Options (a) through (g)] Amount of Employer's
contribution. The Employer's annual contribution to the Trust
will equal the total amount of deferral contributions, matching
contributions, qualified nonelective contributions and
nonelective contributions, as determined under this Section 3.01.
[x] (a) Deferral contributions (Code Sect.401(k) arrangement).
(Choose (1) or (2) or both)
[x] (1) Salary reduction arrangement. The Employer must
contribute the amount by which the Participants have
reduced their Compensation for the Plan Year, pursuant
to their salary reduction agreements on file with the
Advisory Committee. A reference in the Plan to salary
reduction contributions is a reference to these
amounts.
[ ] (2) Cash or deferred arrangement. The Employer will
contribute on behalf of each Participant the portion of
the Participant's proportionate share of the cash or
deferred contribution which he has not elected to
receive in cash. See Section 14.02 of the Plan. The
Employer's cash or deferred contribution is the amount
the Employer may from time to time deem advisable which
the Employer designates as a cash or deferred
contribution prior to making that contribution to the
Trust.
[x] (b) Matching contributions. The Employer will make
matching contributions in accordance with the formula(s)
elected in Part II of this Adoption Agreement Section 3.01.
[x] (c) Designated qualified nonelective contributions. The
Employer, in its sole discretion, may contribute an amount
which it designates as a qualified nonelective contribution.
II-9
[ ] (d) Nonelective contributions. (Choose any combination of
(1) through (4))
[ ] (1) Discretionary contribution. The amount (or
additional amount) the Employer may from time to time
deem advisable.
[ ] (2) The amount (or additional amount) the Employer may
from time to time _______ advisable, separately
determined for each of the following classifications of
Participants:
[ ] (i) Nonhighly Compensated Employees and Highly
Compensated Employees.
[ ] (ii) (Specify classifications) .
Under this Option (2), the Advisory Committee will
allocate the amount contributed for each Participant
classification in accordance with Part II of Adoption
Agreement Section 3.04, as if the Participants in that
classification were the only Participants in the Plan.
[ ] (3) ______% of the Compensation of all Participants
under the Plan, determined for the Employer's taxable
year for which it makes the contribution. [Note: The
percentage selected may not exceed 15%.]
[ ] (4) ______% of Net Profits but not more than
$_________.
[ ] (e) Frozen Plan. This Plan is a frozen Plan effective
___________. The Employer will not contribute to the Plan
with respect to any period following the stated date.
Net Profits. The Employer: (Choose (f) or (g))
[x] (f) Need not have Net Profits to make its annual
contribution under the Plan.
[ ] (g) Must have current or accumulated Net Profits exceed
$________ to make the following contributions: (Choose at
least one)
[ ] (1) Cash or deferred contributions described in Option
(a)(2).
[ ] (2) Matching contributions described in Option (b),
except: _____________.
[ ] (3) Qualified nonelective contributions described in
Option (c).
II-10
[ ] (4) Nonelective contributions described in Option (d).
The term "Net Profits" means the Employer's net income or profits
for any taxable year determined by the Employer upon the basis of
its books of account in accordance with generally accepted
accounting practices consistently applied without any deductions
for Federal and state taxes upon income or for contributions made
by the Employer under this Plan or under any other employee
benefit plan the Employer maintains. The term "Net Profits"
specifically excludes N/A. [Note: Enter "N/A" if no exclusions
apply.]
If the Employer requires Net Profits for matching contributions
and the Employer does not have sufficient Net Profits under
Option (g), it will reduce the matching contribution under a
fixed formula on a prorata basis for all Participants. A
Participant's share of the reduced contribution will bear the
same ratio as the matching contribution the Participant would
have received if Net Profits were sufficient bears to the total
matching contribution all Participants would have received if Net
Profits were sufficient. If more than one member of a related
group (as defined in Section 1.30) execute this Adoption
Agreement, each participating member will determine Net Profits
separately but will not apply this reduction unless, after
combining the separately determined Net Profits, the aggregate
Net Profits are insufficient to satisfy the matching contribution
liability. "Net Profits" includes both current and accumulated
Net Profits.
Part II. [Options (h) through (j)] Matching contribution
formula. [Note: If the Employer elected Option (b), complete
Options (h), (i) and (j).]
[x] (h) Amount of matching contributions. For each Plan Year,
the Employer's matching contribution is: (Choose any
combination of (1), (2), (3), (4) and (5))
[ ] (1) An amount equal to _____% of each Participant's
eligible contributions for the Plan Year.
[x] (2) An amount equal to 100% of each Participant's
first tier of eligible contributions for the Plan Year,
plus the following matching percentage(s) for the
following subsequent tiers of eligible contributions
for the Plan zero.
[ ] (3) Discretionary formula.
[ ] (i) An amount (or additional amount) equal to a
matching percentage the Employer from time to time
may deem advisable of the Participant's eligible
contributions for the Plan Year.
II-11
[ ] (ii) An amount (or additional amount) equal to a
matching percentage the Employer from time to time
may deem advisable of each tier of the
Participant's eligible contributions for the Plan
Year.
[ ] (4) An amount equal to the following percentage of
each Participant's eligible contributions for the Plan
Year, based on the Participant's Years of Service:
Number of Years of Services Matching Percentage
_________ ____
_________ ____
_________ ____
_________ ____
The Advisory Committee will apply this formula by
determining Years of Service as follows: .
[ ] (5) A Participant's matching contributions may not:
(Choose (i) or (ii))
[ ] (i) Exceed .
[ ] (ii) Be less than .
Related Employers. If two or more related employers (as
defined in Section 1.30) contribute to this Plan, the
related employers may elect different matching contribution
formulas by attaching to the Adoption Agreement a separately
completed copy of this Part II. Note: Separate matching
contribution formulas create separate current benefit
structures that must satisfy the minimum participation test
of Code Sect.401(a)(26).]
[x] (i) Definition of eligible contributions. Subject to the
requirements of Option (i), the term "eligible
contributions" means: (Choose any combination of (1)
through (3))
[x] (1) Salary reduction contributions.
[ ] (2) Cash or deferred contributions (including any part
of the Participant's proportionate share of the cash or
deferred contribution which the Employer defers without
the Participant's election).
[ ] (3) Participant mandatory contributions, as designated
in Adoption Agreement Section 4.01. See Section 14.04
of the Plan.
II-12
[x] (j) amount of eligible contributions taken into account.
When determining a Participant's eligible contributions
taken into account under the matching contributions
formula(s), the following rules apply: (Choose any
combination of (1) through (4))
[ ] (1) The Advisory Committee will take into account all
eligible contributions credited for the Plan year.
[ ] (2) The Advisory Committee will disregard eligible
contributions exceed .
[x] (3) The Advisory Committee will treat as the first
tier of eligible contributions, an amount not exceed:
for each Participant, the lesser of (i) the sum for the
Plan Year of his eligible contributions with respect to
each pay period which do not exceed three percent (3%)
of his Compensation (as defined in Part III
(k)(1)(iii)) for such pay period, and (ii) 3% of his
Compensation for such Plan Year.
The subsequent tiers of eligible contributions are:
for each Participant, all eligible contributions for
the Plan Year which exceed the Participant's first tier
of eligible contributions.
[ ] (4) (Specify) .
Part III. [Options (i) and (l)]. special rules for Code
Sect.401(k) Arrangement. (Choose (k) or (l), or both, as
applicable)
[x] (k) Salary Reduction Agreements. The following rules and
restrictions apply to an Employee's salary reduction
agreement: (Make a selection under (1), (2), (3), and (4))
(1) Limitation on amount. The Employee's salary reduction
contributions: (Choose (i) or at least one of (ii) or
(iii))
[ ] (i) No maximum limitation other than as provided
in the Plan.
[x] (ii) May not exceed 17% of Compensation for the
Plan Year, subject to the annual additions
limitation described in Part 2 of Article III and
the 402(g) limitation described in Section 14.07
of the Plan.
[x] (iii) Based on percentages of Compensation
must equal at least one percent (1%) increments,
provided further that, solely for purposes of
II-13
computing the amount to be deducted each payroll
period and the amount described in Part II
(j)(3)(i), the limitation on Compensation under
Section 1.12(A)(1) of the Plan shall be
disregarded.
(2) An Employee may revoke, on a prospective basis, a
salary reduction agreement: (Choose (i), (ii), (iii) or
(iv))
[ ] (i) Once during any Plan Year but not later than
_________________ of the Plan Year.
[ ] (ii) As of any Plan Entry Date.
[x] (iii) As of the first day of any month.
[ ] (iv) (Specify, but must be at least once per Plan
Year) .
(3) An Employee who revokes his salary reduction agreement
may file a new salary agreement with an effective date:
(Choose (i), (ii), (iii) or (iv))
[ ] (i) No earlier than the first day of the next
Plan Year.
[ ] (ii) As of any subsequent Plan Entry Date.
[ ] (iii) As of the first day of any month subsequent
to the month in which he revoked an Agreement.
[x] (iv) (Specify, but must be at least once per Plan
Year following the Plan Year of revocation)
beginning any quarter following a six-month
waiting period from the date the salary reduction
was revoked.
(4) A Participant may increase or may decrease, on a
prospective basis, his salary reduction percentage or dollar
amount: (Choose (i), (ii), (iii) or (iv))
[ ] (i) As of the beginning of each payroll period.
[ ] (ii) As of the first day of each month.
[x] (iii) As of any Plan Entry Date.
[ ] (iv) (Specify, but must permit an increase or a
decrease at least once per Plan Year) .
II-14
[ ] (1) Cash or deferred contributions. For each Plan Year for
which the Employer makes a designated cash or deferred
contribution, a Participant may elect to receive directly in
cash not more than the following portion (or, if less, the
402(g) limitation described in Section 14.07 of the Plan) of
his proportionate share of that cash or deferred
contribution: (Choose (1) or (2))
[ ] (1) All or any portion.
[ ] (2) ____________________%.
3.04 CONTRIBUTION ALLOCATION. The Advisory Committee will
allocate deferral contributions, matching contributions,
qualified nonelective contributions and nonelective contributions
in accordance with Section 14.06 and the elections under this
Adoption Agreement Section 3.04.
Part I. [Options (a) through (d)]. Special Accounting
elections. (Choose whichever elections are applicable to the
Employer's Plan)
[x] (a) Matching Contributions Account. The Advisory Committee
will allocate matching contributions to a Participant's:
(Choose (1) or (2); (3) is available only in addition to
(1))
[x] (1) Regular Matching Contributions Account.
[ ] (2) Qualified Matching Contributions Account.
[ ] (3) Except, matching contributions under Option(s) of
Adoption Agreement Section 3.01 are allocable to
the Qualified Matching Contributions Account.
[x] (b) Special Allocation Dates for Salary Reduction
Contributions. The Advisory Committee will allocate salary
reduction contributions as of the Accounting Date and as of
the following additional allocation dates: As soon as
administratively feasible following receipt by the Trustee.
[x] (c) Special Allocation Dates for Matching Contributions.
The Advisory Committee will allocate matching contributions
as of the Accounting Date and as of the following additional
allocation dates: as soon as administratively feasible
following receipt by the Trustee.
[x] (d) Designated Qualified Nonelective Contributions
Definitions of Participant. For purposes of allocating the
designated qualified nonelective contribution.
"Participant" means: (Choose (1), (2) or (3))
II-15
[ ] (1) All Participants.
[x] (2) Participants who are Nonhighly Compensated
Employees for the Plan Year.
[ ] (3) (Specify) .
Part II. Method of Allocation Nonelective Contribution.
Subject to any restoration allocation required under
Section 5.04, the Advisory Committee will allocate and credit
each annual nonelective contribution (and Participant forfeitures
treated as nonelective contributions) to the Employer
Contributions Account of each Participant who satisfies the
conditions of Section 3.06, in accordance with the allocation
method selected under this Section 3.04. If the Employer elects
Option (e)(2), Option (g)(2) or Option (h), for the first 3% of
Compensation allocated to all Participants, "Compensation" does
not include any exclusions elected under Adoption Agreement
Section 1.12 (other than the exclusion of elective
contributions), and the Advisory Committee must take into account
the Participant's Compensation for the entire Plan Year. (Choose
an allocation method under (e), (f), (g) or (h); (i) is mandatory
if the Employer elects (f), (g) or (h); (j) is optional in
addition to any other election.)
[N/A] (e) Nonintegrated Allocation Formula. (Choose (1) or
(2))
[ ] (1) The Advisory Committee will allocate the annual
nonelective contributions in the same ratio that each
Participant's Compensation for the Plan Year bears to
the total Compensation of all Participants for the Plan
Year.
[ ] (2) The Advisory Committee will allocate the annual
Employer nonelective contributions in the same ratio
that each Participant's Compensation plus Excess
Compensation for the Plan Year bears to the total
Compensation plus Excess Compensation of all
Participants for the Plan Year. The allocation under
this paragraph, as a percentage of each Participant's
Compensation plus Excess Compensation, must not exceed
the applicable percentage (5.7%, 5.4% or 4.3%) listed
under the Maximum Disparity Table following Option (i).
The Advisory Committee then will allocate any remaining
nonelective contributions in the same ratio that each
Participant's Compensation for the Plan Year bears to
the total Compensation of all Participants for the Plan
Year.
II-16
[ ] (g) Three-Tiered Integrated Allocation Formula. First, the
Advisory Committee will allocate __? annual employer
nonelective contributions in the same ratio that each
Participant's Compensation for the Plan Year bears to the
total Compensation of all Participants for the Plan Year.
The allocation under this paragraph, as a percentage of each
Participant's Compensation may not exceed the applicable
percentage (5.7%, 5.4% or 4.3%) listed under the Maximum
Disparity Table following Option (i). Solely for purposes
of the allocation in this first paragraph, "Participant"
means, in addition to a Participant who satisfies the
requirements of Section 3.06 for the Plan Year: (Choose (1)
or (2))
[ ] (1) No other Participant.
[ ] (2) Any other Participant entitled to a top heavy
minimum allocation under Section 3.04(B), but such
Participant's allocation under this Option (g) will not
exceed 3% of his Compensation for the Plan Year.
As a second tier allocation, the Advisory Committee will
allocate the nonelective contributions in the same ratio
that each Participant's Excess Compensation for the Plan
Year bears to the total Excess Compensation of all
Participants for the Plan Year. The allocation under this
paragraph, as a percentage of each Participant's Excess
Compensation, may not exceed the allocation percentage in
the first paragraph.
Finally, the Advisory Committee will allocate any remaining
nonelective contributions in the same ratio that each
Participant's Compensation for the Plan Year bears to the
total Compensation of all Participants for the Plan Year.
[ ] (h) Four-Tiered Integrated Allocation Formula. First, the
Advisory Committee will allocate the annual Employer
nonelective contributions in the same ratio that each
Participant's Compensation for the Plan Year bears to the
total Compensation of all Participants for the Plan Year,
but not exceeding 3% of each participant's Compensation.
Solely for purposes of this first tier allocation, a
"Participant" means, in addition to any Participant who
satisfies the requirements of Section 3.06 for the Plan
Year, any other Participant entitled to a top heavy minimum
allocation under Section 3.04(B) of the Plan.
As a second tier allocation, the Advisory Committee will
allocate the nonelective contributions in the same ratio
that each Participant's Compensation plus Excess
Compensation for the Plan ear bears to the total
Compensation plus Excess Compensation of all Participants
II-17
for the Plan Year. The allocation under this paragraph, as
a percentage of each Participant's Compensation plus Excess
Compensation, must not exceed the applicable percentage
(2.7%, 2.4% or 1.3%) listed under the Maximum Disparity
Table following Option (i).
The Advisory Committee then will allocate any remaining
nonelective contributions in the same ratio that each
Participant's Compensation for the Plan Year bears to the
total Compensation of all Participants for the Plan Year.
[ ] (i) Excess Compensation. For purposes of Option (f), (g)
or (h), "Excess Compensation" ____? Compensation in excess
of the following Integration Level: (Choose (1) or (2))
[ ] (1) ___% (not exceeding 100%) of the taxable wage
base, as determined under Section 230 of the Social
Security Act, in effect on the first day of the Plan
Year: (Choose any combination of (i) and (ii) or
choose (iii))
[ ] (i) Rounded to __________________________ (but
not exceeding the taxable wage base).
[ ] (ii) But not greater than $_______.
[ ] (iii) Without any further adjustment or
limitation.
[ ] (2) $__________ [Note: Not exceeding the taxable wage
base for the Plan Year in which this Adoption Agreement
first is effective.]
Maximum Disparity Table. For purposes of Options (f), (g) and
(h), the applicable percentage is:
Integration Level (as
percentage of taxable
wage base) Applicable
Percentages for
Option (f) or
Option (g) Applicable
Percentages
for Option
(h)
100% 5.7% 2.7%
More than 80% but less
than 100% 5.4% 2.4%
More than 20% (but not
less than $10,001) and
not more than 80% 4.3% 1.3%
20% (or $10,000, if
greater) or less 5.7% 2.7%
II-18
[N/A] (j) Allocation offset. The Advisory Committee will
reduce a Participant's allocation otherwise made under
Part II of this Section 3.04 by the Participant's
allocation under the following qualified plan(s)
maintained by the Employer: .
The Advisory Committee will determine this allocation
reduction: (Choose (1) or (2))
[ ] (1) By treating the term "nonelective contribution" as
including all amounts paid or accrued by the Employer
during the Plan Year to the qualified plan(s)
referenced under this Option (j). If a Participant
under this Plan also participates in that other plan,
the Advisory Committee will treat the amount the
Employer contributes for or during a Plan Year on
behalf of a particular Participant under such other
plan as an amount allocated under this Plan to that
Participant's Account for that Plan Year. The Advisory
Committee will make the computation of allocation
required under the immediately preceding sentence
before making any allocation of nonelective
contributions under this Section 3.04.
[ ] (2) In accordance with the formula provided in an
addendum to this Adoption Agreement, numbered 3.04(j).
Top Heavy Minimum Allocation Method of Compliance. If a
Participant's allocation under this Section 3.04 is less than the
top heavy minimum allocation to which he is entitled under
Section 3.04(B): (Choose (k) or (l))
[ ] (k) The Employer will make any necessary additional
contribution to the Participant's Account, as described in
Section 3.04(B)(7)(a) of the Plan.
[x] (l) The Employer will satisfy the top heavy minimum
allocation under the following plan(s) it maintains: list
all plans. However, the Employer will make any necessary
additional contribution to satisfy the top heavy minimum
allocation for an Employee covered only under this Plan and
not under the other plan(s) designated in this Option (l).
See Section 3.04(B)(7)(b) of the Plan.
If the Employer maintains another plan, the Employer may provide
in an addendum to this Adoption Agreement, numbered Section 3.04,
any modifications to the Plan necessary to satisfy the top heavy
requirements under Code Sect.416.
Related employers. If two or more related employers (as defined
in Section 1.30) contribute to this Plan, the Advisory Committee
must allocate all Employer nonelective contributions (and
II-19
forfeitures treated as nonelective contributions) to each
Participant in the Plan, in accordance with the elections in this
Adoption Agreement Section 3.04: (Choose (m) or (n))
[ ] (m) Without regard to which contributing related group
member employs the Participant.
[x] (n) Only to the Participants directly employed by the
contributing Employer. If a Participant receives
Compensation from more than one contributing Employer, the
Advisory Committee will determine the allocations under this
Adoption Agreement Section 3.04 by prorating among the
participating Employers the Participant's Compensation and,
if applicable, the Participant's Integration Level under
Option (i).
3.05 FORFEITURE ALLOCATION. Subject to any restoration
allocation required under Sections 5.04 or 9.14, the Advisory
Committee will allocate a Participant forfeiture in accordance
with Section 3.04: (Choose (a) or (b); (c) and (d) are optional
in addition to (a) or (b))
[N/A] (a) As an Employer nonelective contribution for the
Plan Year in which the forfeiture occurs, as if the
Participant forfeiture were an additional nonelective
contribution for that Plan Year.
[ ] (b) To reduce the Employer matching contributions and
nonelective contributions for the Plan Year: (Choose (1) or
(2))
[ ] (1) in which the forfeiture occurs.
[ ] (2) immediately following the Plan Year in which the
forfeiture occurs.
[ ] (c) To the extent attributable to matching contributions:
(Choose (1), (2) or (3))
[ ] (1) In the manner elected under Options (a) or (b).
[ ] (2) First to reduce Employer matching contributions
for the Plan Year: (Choose (i) or (ii))
[ ] (i) in which the forfeiture occurs,
[ ] (ii) immediately following the Plan Year in which
the forfeiture occurs,
then as elected in Options (a) or (b).
II-20
[ ] (3) As a discretionary matching contribution for the
Plan Year in which the forfeiture occurs, in lieu of
the manner elected under Options (a) or (b).
[ ] (d) First to reduce the Plan's ordinary and necessary
administrative expenses for the Plan Year and then will
allocate any remaining forfeitures in the manner described
in Options (a), (b) or (c), whichever applies. If the
Employer elects Option (c), the forfeitures used to reduce
Plan expenses: (Choose (1) or (2))
[ ] (1) relate proportionately to forfeitures described in
Option (c) and to forfeitures described in Options (a)
or (b).
[ ] (2) relate first to forfeitures described in Option
____.
Allocation of forfeited excess aggregate contributions. The
Advisory Committee will allocate any forfeited excess aggregate
contributions (as described in Section 14.09); (Choose (e), (f)
or (g))
[N/A] (e) To reduce Employer matching contributions for the
Plan Year: (Choose (1) or (2))
[N/A] (1) in which the forfeiture occurs.
[ ] (2) immediately following the Plan Year in which the
forfeiture occurs.
[ ] (f) As Employer discretionary matching contributions for
the Plan Year in which forfeited, except the Advisory
Committee will not allocate these forfeitures to the Highly
Compensated Employees who incurred the forfeitures.
[ ] (g) In accordance with Options (a) through (d), whichever
applies, except the Advisory Committee will not allocate
these forfeitures under Option (a) or under Option (c)(3) to
the Highly Compensated Employees who incurred the
forfeitures.
3.06 ACCRUAL OF BENEFIT.
Compensation taken into account. For the Plan Year in which the
Employee first becomes a Participant, the Advisory Committee will
determine the allocation of any cash or deferred contribution,
designated qualified nonelective contribution or nonelective
contribution by taking into account: (Choose (a) or (b))
[x] (a) The Employee's Compensation for the entire Plan Year.
II-21
[ ] (b) The Employee's Compensation for the portion of the Plan
Year in which the Employee actually is a Participant in the
Plan.
Accrual Requirements. Subject to the suspension of accrual
requirements of Section 3.06(E) of the Plan, to receive an
allocation of cash or deferred contributions, matching
contributions, designated qualified nonelective contributions,
nonelective contributions and Participant forfeitures, if any,
for the Plan Year, a Participant must satisfy the conditions
described in the following elections: (Choose (c) or at least
one of (d) through (f))
[ ] (c) Safe harbor rule. If the Participant is employed by
the Employer on the last day of the Plan Year, the
Participant must complete at least one Hour of Service for
that Plan Year. If the Participant is not employed by the
Employer on the last day of the Plan Year, the Participant
must complete at least 501 Hours of Service during the Plan
Year.
[x] (d) Hours of Service condition. The Participant must
complete the following minimum number of Hours of Service
during the Plan Year: (Choose at least one of (1) through
(5))
[ ] (1) 1,000 Hours of Service.
[ ] (2) (Specify, but the number of Hours of Service may
n o t e x c e e d 1 , 0 0 0 ) _ _ _ _
______________________________________________.
[ ] (3) No Hour of Service requirement if the Participant
terminates employment during the Plan Year on account
of: (Choose (i), (ii) or (iii))
[ ] (i) Death.
[ ] (ii) Disability.
[ ] (iii) Attainment of Normal Retirement Age in
the current Plan Year or in a prior Plan Year.
[ ] (4) _____ Hours of Service (not exceeding 1,000) if the
Participant terminates employment with the Employer during
the Plan Year, subject to any election in Option (3).
[x] (5) No Hour of Service requirement for an allocation of the
following contribution: matching contributions and salary
deferrals.
II-22
[ ] (e) Employment condition. The Participant must be employed
by the Employer on the last day of the Plan Year,
irrespective of whether he satisfies any Hours of Service
condition under Option (d), with the following exceptions:
(Choose (1) or at least one of (2) through (5))
[ ] (1) No exceptions.
[ ] (2) Termination of employment because of death.
[ ] (3) Termination of employment because of disability.
[ ] (4) Termination of employment following attainment of
Normal Retirement Age.
[ ] (5) No employment condition for the following
c o n t r i b u t i o n s : _ _ _ _ _ _ _ _ _ _ _
_______________________________________________________
___.
[ ] (f) (Specify other conditions, if applicable): .
Suspension of Accrual Requirements. the suspension of accrual
requirements of Section 3.06(E) of the Plan: (Choose (g), (h) or
(i))
[ ] (g) Applies to the Employer's Plan.
[x] (h) Does not apply to the Employer's Plan.
[ ] (i) Applies in modified form to the Employer's Plan, as
described in an addendum to this Adoption Agreement,
numbered Section 3.06(E).
Special accrual requirements for matching contributions. If the
Plan allocates matching contributions two or more allocation
dates for a Plan Year, the Advisory Committee, unless otherwise
specified in Option (l), will apply any Hours of Service
condition by dividing the required Hours of Service on a pro rata
basis to the allocation periods included in that Plan Year.
Furthermore, a Participant who satisfies the conditions described
in this Adoption Agreement Section 3.06 will receive an
allocation of matching contributions (and forfeitures treated as
matching contributions) only if the Participant satisfies the
following additional conditions(s): (Choose (j) or at least one
of (k) or (l))
[N/A] (j) No additional conditions.
[ ] (k) The Participant is not a Highly Compensated Employee
for the Plan Year. This Option (k) applies to: (Choose (1)
or (2))
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[ ] (l) All matching contributions.
[ ] (2) Matching contributions described in Option(s)
of Adoption Agreement Section 3.01.
[ ] (l) (Specify) .
.
3.15 MORE THAN ONE PLAN LIMITATION. If the provisions of
Section 3.15 apply, the Excess Amount attributed to this Plan
equals: (Choose (a), (b) or (c))
[ ] (a) The product of:
(i) the total Excess Amount allocated as of such date
(including any amount which the Advisory Committee
would have allocated but for the limitations of Code
Sect.415), times
(ii) the ratio of (1) the amount allocated to the
Participant as of such date under this Plan divided by
(2) the total amount allocated as of such date under
all qualified defined contribution plans (determined
without regard to the limitations of Code Sect.415).
[ ] (b) The total Excess Amount.
[x] (c) None of the Excess Amount.
3.18 DEFINED BENEFIT PLAN LIMITATION.
Application of limitation. The limitation under Section 3.18 of
the Plan: (Choose (a) or (b))
[ ] (a) Does not apply to the Employer's Plan because the
Employer does not maintain and never has maintained a
defined benefit plan covering any Participant in this Plan.
[x] (b) Applies to the Employer's Plan. To the extent
necessary to satisfy the limitation under Section 3.18, the
Employer will reduce: (Choose (1) or (2))
[x] (1) The Participant's projected annual benefit under
the defined benefit plan under which the Participant
participates.
[ ] (2) Its contribution or allocation on behalf of the
Participant to the defined contribution plan under
which the Participant participates and then, if
necessary, the Participant's projected annual benefit
under the defined benefit plan under which the
Participant participates.
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[Note: If the Employer selects (a), the remaining options in
this Section 3.18 do not apply to the __________________ Plan.]
Coordination with top heavy minimum allocation. The Advisory
Committee will apply the top heavy minimum allocation provisions
of Section 3.04(B) of the Plan with the following modifications:
(Choose (c) or at least one of (d) or (e))
[x] (c) No modifications.
[ ] (d) For Non-Key Employees participating only in this Plan,
the top heavy minimum allocation is the minimum allocation
described in Section 3.04(B) determined by substituting
____% (Not less than 4%) for "3%," except: (Choose (i) or
(ii))
[ ] (i) No exceptions.
[ ] (ii) Plan Years in which the top heavy ratio exceeds
90%.
[ ] (e) For Non-Key Employees also participating in the defined
benefit plan, the top heavy minimum is: (Choose (1) or (2))
[ ] (1) 5% of Compensation (as determined under Section
3.04(B) or the Plan) irrespective of the contribution
rate of any Key Employee, except: (Choose (i) or (ii))
[ ] (i) No exceptions.
[ ] (ii) Substituting "7 1/2%" for "5%" if the top heavy
ratio does not exceed 90%.
[ ] (2) 0%. [Note: The Employer may not select this
Option (2) unless the defined benefit plan satisfies
the top heavy minimum benefit requirements of Code
Sect.416 for these Non-Key Employees.]
Actuarial Assumptions for Top Heavy Calculation. To determine
the top heavy ratio, the Advisory Committee will use the
following interest rate and mortality assumptions to value
accrued benefits under a defined benefit plan: .
If the elections under this Section 3.18 are not appropriate to
satisfy the limitations of Section 3.18, or the top heavy
requirements under Code Sect.416, the Employer must provide the
appropriate provisions in an addendum to this Adoption Agreement.
ARTICLE IV
PARTICIPANT CONTRIBUTIONS
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4.01 PARTICIPANT NONDEDUCTIBLE CONTRIBUTIONS. The Plan:
(Choose (a) or (b); (c) is available only with (b))
[x] (a) Does not permit Participant nondeductible
contributions.
[ ] (b) Permits Participant nondeductible contributions,
pursuant to Section 14.04 of the Plan.
[ ] (c) The following portion of the Participant's
nondeductible contributions for the Plan Year mandatory
contributions under Option (i)(3) of Adoption Agreement
Section 3.01: (Choose (1) or (2))
[ ] (1) The amount which is not less than:
_______________________________ __________________.
(2) The amount which is not greater than:
_____________________________
_______________________________________________________
___________________.
Allocation Dates. The Advisory Committee will allocate
nondeductible contributions for each Plan Year as of the
Accounting Date and the following additional allocation dates:
(Choose (d) or (e))
[N/A] (d) No other allocation dates
[ ] (e) (Specify) ______________________________________.
As of an allocation date, the Advisory Committee will credit all
nondeductible contributions made for the relevant allocation
period. Unless otherwise specified in (e), a nondeductible
contribution relates to an allocation period only if actually
made to the Trust no later than 30 days after that allocation
period ends.
4.05 PARTICIPANT CONTRIBUTION - WITHDRAWAL/DISTRIBUTION.
Subject to the restrictions of Article VI, the following
distribution options apply to a Participant's Mandatory
Contributions Accounts, if any, prior to his Separation from
Service: (Choose (a) or at least one of (b) through (d))
[ ] (a) No distribution options prior to Separation from
Service.
[ ] (b) The same distribution options applicable to the
Deferral Contributions Account prior to the Participant's
Separation from Service, as elected in Adoption Agreement
Section 6.03.
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[ ] (c) Until he retires, the Participant has a continuing
election to receive all or any portion of his Mandatory
Contributions Account if: (Choose (1) or at least one of (2)
through 4))
[ ] (1) No conditions.
[ ] (2) The mandatory contributions have accumulated for
at least _____ Plan Years since the Plan Year for which
contributed.
[ ] (3) The Participant suspends making nondeductible
contributions for a period of _____ months.
[ ] (4) ( S p e c i f y )
________________________________________.
[ ] (d) ( S p e c i f y )
_____________________________________________.
ARTICLE V
TERMINATION OF SERVICE - PARTICIPANT VESTING
5.01 NORMAL RETIREMENT. Normal Retirement Age under the
Plan is: (Choose (a) or (b))
[x] (a) 65 [State age, but may not exceed age 65].
[ ] (b) The later of the date the Participant attains _____
years of age or the ____ anniversary of the first day of the
Plan Year in which the Participant commenced participation
in the Plan. [The age selected may not exceed age 65 and
the anniversary selected may not exceed the 5th.]
5.02 PARTICIPANT DEATH OR DISABILITY. The 100% vesting
rule under Section 5.02 of the Plan: (Choose (a) or choose one or
both of (b) and (c))
[x] (a) Does not apply.
[ ] (b) Applies to death.
[ ] (c) Applies to disability.
5.03 VESTING SCHEDULE.
Deferral Contributions Account/Qualified Matching Contributions
Account/Qualified Nonelective Contributions Account/Mandatory
Contributions Account. A Participant has a 100% Nonforfeitable
interest at all times in his Deferral Contributions Account, his
Qualified Matching Contributions Account, his Qualified
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Nonelective Contributions Accounts and in his Mandatory
Contributions Account.
Regular Matching Contributions Account/Employer Contributions
Account. With respect to a Participant's Regular Matching
Contributions Account and Employer Contributions Account, the
Employer elects the following vesting schedule: (Choose (a) or
(b); (c) and (d) are available only as additional options).
[x] (a) Immediate vesting. 100% Nonforfeitable at all times.
[Note: The Employer must elect Option (a) if the eligibility
conditions under Adoption Agreement Section 2.01(c) require
2 years of service or more than 12 months of employment.]
[ ] (b) Graduated Vesting Schedules.
Top Heavy Schedule Non Top Heavy Schedule
(Mandatory) (Optional)
Years of Nonforfeitable Years of
Nonforfeitable
Service Percentage Service
Percentage
Less than 1 % Less than 1 %
1 % 1 %
2 % 2 %
3 % 3 %
4 % 4 %
5 % 5 %
6 or more 100% 6 %
7 or more 100%
[N/A] (c) Special vesting election for Regular Matching
Contributions Account. In lieu of the election under
Options (a) or (b), the Employer elects the following
vesting schedule for a Participant's Regular Matching
Contributions Account: (Choose (1) or (2))
[ ] (1) 100% Nonforfeitable at all times.
[ ] (2) In accordance with the vesting schedule described
in the addendum to this Adoption Agreement, numbered
5.03(c). [Note: If the Employer elects this Option
(c)(2), the addendum must designate the applicable
vesting schedule(s) using the same format as used in
Option (b).]
[Note: Under Options (b) and (c)(2), the Employer must complete a
Top Heavy Schedule which satisfies Code Sect.416. The Employer,
at its option may complete a Non Top Heavy Schedule. The Non Top
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Heavy Schedule must satisfy Code Sect.411(a)(2). Also see
Section 7.05 of the Plan.]
[ ] (d) The Top Heavy Schedule under Option (b) (and, if
applicable, under Option (c)(2) applies. Chose (1) or (2))
[ ] (1) Only in a Plan Year for which the Plan is top
heavy.
[ ] (2) In the Plan Year for which the Plan first is top
heavy and then in all subsequent Plan Years. [Note:
The Employer may not elect Option (d)( unless it has
completed a Non Top Heavy Schedule.]
Minimum vesting. (Choose (e) or (f))
[ ] (e) The Plan does not apply a minimum vesting rule.
[ ] (f) A Participant's Nonforfeitable Accrued Benefit will
never be less than the lesser of $_______________ or his
entire Accrued Benefit, even if the application of a
graduated vesting schedule under Options (b) or (c) would
result in a smaller Nonforfeitable Accrued Benefits.
Life Insurance Investments. The Participant's Accrued Benefit
attributable to insurance contracts purchased on his behalf under
Article XI is: (Choose (g) or (h))
[ ] (g) Subject to the vesting election under Options (a), (b)
or (c).
[ ] (h) 100% Nonforfeitable at all times, irrespective of the
vesting election under Options (b) or (c)(2).
5.04 CASH-OUT DISTRIBUTIONS TO PARTIALLY-VESTED
PARTICIPANTS/ RESTORATION OF FORFEITED ACCRUED BENEFIT. The
deemed cash-out rule described in Section 5.04(C) of the Plan:
(Choose (a) or (b))
[x] (a) Does not apply.
[ ] (b) Will apply to determine the timing of forfeitures for
0% vested Participants. A Participant is not a 0% vested
Participant if he has a Deferral Contributions Account.
5.06 YEAR OF SERVICE - VESTING.
Vesting computation period. The Plan measures a Year of Service
on the basis of the following 12 consecutive month periods:
(Choose (a) or (b))
[ ] (a) Plan Years.
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[ ] (b) Employment Years. An Employment Year is the 12
consecutive month period measured from the Employee's
Employment Commencement Date and each successive 12
consecutive month period measured from each anniversary of
that Employment Commencement Date.
Hours of Service. The minimum number of Hours of Service an
Employee must complete during a vesting computation period to
receive credit for a Year of Service is: (Choose (c) or (d))
[ ] (c) 1,000 Hours of Service.
[ ] (d) ____ Hours of Service. [Note: The Hours of Service
requirement may not exceed 1,000.]
5.08 INCLUDED YEARS OF SERVICE - VESTING. The Employer
specifically excludes the following Years of Service: (Choose (a)
or at least one of (b) through (e))
[x] (a) None other than as specified in Section 5.08(a) of the
Plan.
[ ] (b) Any Year of Service before the Participant attained the
age of ___. [Note: The age selected may not exceed age 18.]
[ ] (c) Any Year of Service during the period the Employer did
not maintain this Plan or a predecessor plan.
[ ] (d) Any Year of Service before a Break in service if the
number of consecutive Breaks in Service equals or exceeds
the greater of 5 or the aggregate number of the Years of
Service prior to the Break. This exception applies only if
the Participant is 0% vested in his Accrued Benefit derived
from Employer contributions at the time he has a Break in
Service. Furthermore, the aggregate number of Years of
Service before a Break in Service do not include any Years
of Service not required to be taken into account under this
exception by reason of any prior Break in Service.
[ ] (e) Any Year of Service earned prior to the effective date
of ERISA if the Plan would have disregarded that Year of
Service on account of an Employee's Separation from Service
under a Plan provision in effect and adopted before January
1, 1974.
ARTICLE VI
TIME AND METHOD OF PAYMENTS OF BENEFITS
Code Sect.411(d)(6) Protected Benefits. The elections under this
Article VI may not eliminate Code Sect.411(d)(6) protected
benefits. To the extent the elections would eliminate a Code
Sect.411(d)(6) protected benefit, see Section 13.02 of the Plan.
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Furthermore, if the elections liberalize the optional forms of
benefits under the Plan, the more liberal options apply on the
later of the adoption date of the Effective Date of this Adoption
Agreement.
6.01 TIME OF PAYMENT OF ACCRUED BENEFIT.
Distribution date. A distribution date under the Plan means any
day of the Plan year. [Note: The Employer must specify the
appropriate date(s). The specified distribution dates primarily
establish annuity starting dates and the notice and consent
periods prescribed by the Plan. The Plan allows the Trustee on
administratively practicable period of time to make the actual
distribution relating to a particular distribution date.]
Nonforfeitable Accrued Benefit Not Exceeding $3,500. Subject to
the limitations of Section 6.01(a)(1), the distribution date for
distribution of a Nonforfeitable Accrued Benefit not exceeding
$3,500 is (Choose (a), (b), (c), (d) or (e))
[ ] (a)
____________________________________________________________
_______ of the _________ Plan Year beginning after the
Participant's Separation from Service.
[x] (b) any distribution date following the Participant's
Separation from Service.
[ ] (c)
____________________________________________________________
________ of the Plan Year after the Participant incurs _____
Break(s) in Service (as defined in Article V).
[ ] (d) ________________________________________ following the
Participant's attainment of Normal Retirement Age, but not
earlier than _____ days following his Separation from
Service.
[ ] (e) (Specify) .
Nonforfeitable Accrued Benefit Exceeds $3,500. See the elections
under Section 6.03.
Disability. The distribution date, subject to Section
6.01(A)(3), is: (Choose (f), (g) or (h))
[ ] (f)
____________________________________________________________
________ after the Participant terminates employment because
of disability.
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[x] (g) The same as if the Participant had terminated
employment without disability.
[ ] (h) (Specify) .
Hardship. (Choose (i) or (j))
[x] (i) The Plan does not permit a hardship distribution to a
Participant who has separated from Service.
[ ] (j) The Plan permits a hardship distribution to a
Participant who has separated from Service in accordance
with the hardship distribution policy stated in: (Choose
(1), (2) or (3))
[ ] (1) Section 6.01(A)(4) of the Plan.
[ ] (2) Section 14.11 of the Plan.
[ ] (3) The addendum to this Adoption Agreement, numbered
Section 6.01.
Default on a Loan. If a Participant or Beneficiary defaults on a
loan made pursuant to a loan policy adopted by the Advisory
Committee pursuant to Section 9.04, the Plan: (Choose (k), (l)
or (m))
[x] (k) Treats the default as a distributable event. The
Trustee, at the time of the default,will reduce the
Participant's Nonforfeitable Accrued Benefit by the lesser
of the amount in default (plus accrued interest) or the
Plan's security interest in that Nonforfeitable Accrued
Benefit. To the extent the loan is attributable to the
Participant's Deferral Contributions Account, Qualified
Matching Contributions Account or Qualified Nonelective
Contributions Account, the Trustee will not reduce the
Participant's Nonforfeitable Accrued Benefit unless the
Participant has separated from Service or unless the
Participant has attained age 59 1/2.
[ ] (l) Does not treat the default as a distributable event.
When an otherwise distributable event first occurs pursuant
to Section 6.01 or Section 6.03 of the Plan, the Trustee
will reduce the Participant's Nonforfeitable Accrued Benefit
by the lesser of the amount in default (plus accrued
interest) or the Plan's security interest in that
Nonforfeitable Accrued Benefit.
[ ] (m) (Specify) .
6.02 METHOD OF PAYMENT OF ACCRUED BENEFIT. The Advisory
Committee may Section 6.02 of the Plan with the following
II-32
modifications: (Choose (a) or at least one of (b), (c), (d) and
(e))
[ ] (a) No modifications.
[ ] (b) Except as required under Section 6.01 of the Plan, a
lump sum distribution is not available: .
[x] (c) An installment distribution: (Choose (1) or at least
one of (2) or (3))
[x] (1) Is not available under the Plan.
[ ] (2) May not exceed the lesser of _____ years or the
maximum period permitted under Section 6.02.
[ ] (3) (Specify) .
[ ] (d) The Plan permits the following annuity options: .
Any Participant who elects a life annuity option is subject
to the requirements of Sections 6.04(A), (B), (C) and (D) of
the Plan. See Section 6.04(E). [Note: The Employer may
specify additional annuity options in an addendum to this
Adoption Agreement, numbered 6.02(d).]
[x] (e) If the Plan invests in qualifying Employer securities,
as described in Section 10.03(F), a Participant eligible to
elect distribution under Section 6.03 may elect to receive
that distribution in Employer securities only in accordance
with the provisions of the addendum to this Adoption
Agreement, numbered 6.02(e).
6.03 BENEFIT PAYMENT ELECTIONS.
Participant Elections After Separation from Service. A
Participant who is eligible to make distribution elections under
Section 6.03 of the Plan may elect to commence distribution of
his Nonforfeitable Accrued Benefit: (Choose at least one of (a)
through (c))
[ ] (a) As of any distribution date, but not earlier than
_____________________ of the ________ Plan Year beginning
after the Participant's Separation from Service.
[x] (b) As of the following date(s): (Choose at least one of
Options (1) through (6))
[ ] (1) Any distribution date after the close of the Plan
Year in which the Participant attains Normal Retirement
Age.
II-33
[x] (2) Any distribution date following his Separation
from Service with the Employer.
[ ] (3) Any distribution date in the ___________________
Plan Year(s) beginning after his Separation from
Service.
[ ] (4) Any distribution date in the Plan Year after the
Participant incurs _____________ Break(s) in Service
(as defined in Article V).
[ ] (5) Any distribution date following attainment of age
_____ and completion of at least _____ Years of Service
(as defined in Article V).
[ ] (6) (Specify) .
[ ] (c) (Specify)
.
The distribution events described in the election(s) made
under Options (a), (b) or (c) apply equally to all Accounts
maintained for the Participant unless otherwise specified in
Option (c).
Participant Elections Prior to Separation from Service - Regular
Matching Contributions Account and Employer Contributions
Account. Subject to the restrictions of Article VI, the
following distribution options apply to a Participant's Regular
Matching Contributions Account and Employer Contributions Account
prior to his Separation from Service: (Choose (d) or at least
one of (e) through (h))
[ ] (d) No distribution options prior to Separation from
Service.
[ ] (e) Attainment of Specified Age. Until he retires, the
Participant has a continuing election to receive all or any
portion of his Nonforfeitable interest in these Accounts
after he attains: (Choose (2) or (2))
[ ] (1) Normal Retirement Age.
[ ] (2) _____ years of age and is at least _____% vested
in these Accounts. [Note: If the percentage is less
than 100%, see the special vesting formula in Section
5.03.]
[ ] (f) After a Participant has participated in the Plan for a
period of not less than _____ years and he is 100% vested in
these Accounts, until he retires, the Participant has a
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continuing election to receive all or any portion of the
Accounts. [Note: The number in the blank space may not be
less than 5.]
[x] (g) Hardship. A Participant may elect a hardship
distribution prior to his Separation from Service in
accordance with the hardship distribution policy: (Choose
(1), (2) or (3); (4) is available only as an additional
option)
[ ] (1) Under Section 6.01(A)(4) of the Plan.
[x] (2) Under Section 14.11 of the Plan.
[ ] (3) Provided in the addendum to this Adoption
Agreement, numbered Section 6.03.
[ ] (4) In no event may a Participant receive a hardship
distribution before he is at least _____% vested in
these Accounts. [Note: If the percentage in the blank
is less than 100%, see the special vesting formula in
Section 5.03.]
[ ] (h) (Specify) .
[Note: The Employer may use an addendum, numbered 6.03, to
provide additional language authorized by Options (b)(6), (c),
(g)(3) or (h) of this Adoption Agreement Section 6.03.]
Participant Elections Prior to Separation from Service - Deferral
Contributions Account, Qualified Matching Contributions Account
and Qualified Nonelective Contributions Account. Subject to the
restrictions of Article VI, the following distribution options
apply to a Participant's Deferral Contributions Account,
Qualified Matching Contributions Account and Qualified
Nonelective Contributions Account prior to his Separation from
Service: (Choose (i) or at least one of (j) through (l))
[ ] (i) No distribution options prior to Separation from
Service.
[ ] (j) Until he retires, the Participant has a continuing
election to receive all or any portion of these Accounts
after he attains: (Choose (1) or (2))
[ ] (1) The later of Normal Retirement Age or age 59 1/2.
[ ] (2) Age _____ (at least 59 1/2).
[x] (k) Hardship. A Participant, prior to this Separation from
Service, may elect a hardship distribution from his Deferral
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Contributions Account in accordance with the hardship
distribution policy under Section 14.11 of the Plan.
[ ] (l) ( S p e c i f y )
___________________________________________________________.
[Note: Option (l) may not permit in service distributions
prior to age 59 1/2 (other than hardship_ and may not modify
the hardship policy described in Section 14.11.]
Sale of trade or business/subsidiary. If the Employer sells
substantially all of the assets (within the meaning of Code
Sect.409(d)(2)) used in a trade or business or sells a subsidiary
(within the meaning of Code Sect.409(d)(3)), a Participant who
continues employment with the acquiring corporation is eligible
for distribution from his Deferral Contributions Account,
Qualified Matching Contributions Account and Qualified
Nonelective Contributions Account: (Choose (m) or (n))
[ ] (m) Only as described in this Adoption Agreement Section
6.03 for distributions prior to Separation from Service.
[x] (n) As if he has a Separation from Service. After
March 31, 1988, a distribution authorized solely by reason
of this Option (n) must constitute a lump sum distribution,
determined in a manner consistent with Code Sect.402(k)(10)
and the applicable Treasury regulations.
6.04 ANNUITY DISTRIBUTIONS TO PARTICIPANTS AND SURVIVING
SPOUSES. The annuity distribution requirements of Section 6.04:
(Choose (a) or (b))
[ ] (a) Apply only to a Participant described in Section
6.04(E) of the Plan (relating to the profit sharing
exception to the joint and survivor requirements).
[ ] (b) Apply to all Participants.
ARTICLE IX
ADVISORY COMMITTEE - DUTIES WITH
RESPECT TO PARTICIPANTS' ACCOUNTS
9.01 VALUE OF PARTICIPANT'S ACCRUED BENEFIT. If a
distribution (other than a distribution from a segregated Account
and other than a corrective distribution described in Sections
14.07, 14.08, 14.09 or 14.10 of the Plan) occurs more than 90
days after the most recent valuation date, the distribution will
include interest at: (choose (a), (b) or (c))
[x] (a) 0% per annum. [Note: The percentage may equal 0%.]
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[ ] (b) The 90 day Treasury bill rate in effect at the
beginning of the current valuation period.
[ ] (c) (Specify) .
9.11 ALLOCATION AND DISTRIBUTION OF NET INCOME GAIN OR
LOSS. Pursuant to Section 14.12, to determine the allocation of
net income, gain or loss: (Complete only those items, if any,
which are applicable to the Employer's Plan)
[x] (a) For salary reduction contributions, the Advisory
Committee will: (Choose (1), (2), (3), (4) or (5))
[x] (1) Apply Section 9.11 without modification.
[ ] (2) Use the segregated account approach described in
Section 14.12.
[ ] (3) Use the weighted average method described in
Section 14.12, based on a _______________ weighting
period.
[ ] (4) Treat as part of the relevant Account at the
beginning of the valuation period _____% of the salary
reduction contributions: (Choose (i) or (ii))
[ ] (i) made during that valuation period.
[ ] (ii) made by the following specified time:
_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
________________________________.
[ ] (5) Apply the allocation method described in the
addendum to this Adoption Agreement numbered 9.11(a).
[x] (b) For matching contributions, the Advisory Committee
will: (Choose (1), (2), (3) or (4))
[x] (1) Apply Section 9.11 without modification.
[ ] (2) Use the weighted average method described in
Section 14.12, based on a _______________ weighting
period.
[ ] (3) Treat as part of the relevant Account at the
beginning of the valuation period _____% of the
matching contributions allocated during the valuation
period.
[ ] (4) Apply the allocation method described in the
addendum to this Adoption Agreement numbered 9.11(b).
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[N/A] (c) For Participant nondeductible contributions, the
Advisory Committee will: (Choose (1), (2), (3), (4) or
(5))
[ ] (1) Apply Section 9.11 without modification.
[ ] (2) Use the segregated account approach described in
Section 14.12.
[ ] (3) Use the weighted average method described in
Section 14.12, based on a _______________ weighting
period.
[ ] (4) Treat as part of the relevant Account at the
beginning of the valuation period _____% of the
Participant nondeductible contributions: (Choose (i)
or (ii))
[ ] (i) made during that valuation period.
[ ] (ii) made by the following specified time:
___________________ _____________________.
[ ] (5) Apply the allocation method described in the
addendum to this Adoption Agreement numbered 9.11(c).
ARTICLE X
TRUSTEE AND CUSTODIAN, POWERS AND DUTIES
10.03 INVESTMENT POWERS. Pursuant to Section 10.03[F] of
the Plan, the aggregate investments in qualifying Employer
securities and in qualifying Employer real property: (Choose (a)
or (b))
[ ] (a) May not exceed 10% of Plan assets.
[x] (b) May not exceed 100% of Plan assets. [Note: The
percentage may not exceed 100%]
10.14 VALUATION OF TRUST. In addition to each Accounting
Date, the Trustee must value the Trust Fund on the following
valuation date(s): (Choose (a) or (b))
[ ] (a) No other mandatory valuation dates.
[x] (b) (Specify) each business day upon which Plan assets can
be purchased or sold, commonly referred to as "Daily"
accounting.
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EFFECTIVE DATE ADDENDUM
(Restated Plans Only)
The Employer must complete this addendum only if the
restated Effective Date specified in Adoption Agreement
Section 1.18 is different than the restated effective date for at
least one of the provisions listed in this addendum. In lieu of
the restated Effective Date in Adoption Agreement Section 1.18,
the following special effective dates apply: (Choose whichever
elections apply)
[ ] (a) Compensation definition. The Compensation definition
of Section 1.12 (other than the $200,000 limitation) is
effective for Plan Years beginning after _______________.
[Note: May not be effective later than the first day of the
first Plan Year beginning after the Employer executes this
Adoption Agreement to restate the Plan for the Tax Reform
Act of 1986, if applicable.]
[ ] (b) Eligibility conditions. The eligibility conditions
specified in Adoption Agreement Section 2.01 are effective
for Plan Years beginning after _______________.
[ ] (c) Suspension of Years of Service. The suspension of
Years of Service rule elected under Adoption Agreement
Section 2.03 is effective for Plan Years beginning after
_______________.
[ ] (d) Contribution/allocation formula. The contribution
formula elected under Adoption Agreement Section 3.01 and
the method of allocation elected under Adoption Agreement
Section 3.04 is effective for Plan Years beginning after
_______________.
[ ] (e) Accrual requirements. The accrual requirements of
Section 3.06 are effective for Plan Years beginning after
_______________.
[ ] (f) Employment condition. The employment condition of
Section 3.06 is effective for Plan Years beginning after
_______________.
[ ] (g) Elimination of Net Profits. The requirement for the
Employer not to have net profits to contribute to this Plan
is effective for Plan Years beginning after _______________.
[Note: The date specified may not be earlier than
December 31, 1985.]
[ ] (h) Vesting Schedule. The vesting schedule elected under
Adoption Agreement Section 5.03 is effective for Plan Years
beginning after _______________.
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[x] (i) Allocation of Earnings. The special allocation
provisions elected under Adoption Agreement Section 9.11 are
effective for Plan Years beginning after and 12/31/94 after
a reasonable period of time to effect redistribution of
funds and implementation of new investment director
procedures.
[ ] (j) ( S p e c i f y )
____________________________________________________________
_ __________________________________________________.
For Plan Years prior to the special Effective Date, the
terms of the Plan prior to its restatement under this Adoption
Agreement will control for purposes of the designated provisions.
A special Effective Date may not result in the delay of a Plan
provision beyond the permissible Effective Date under any
applicable law requirements.
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Execution Page
The Trustee (and Custodian, if applicable), by executing
this Adoption Agreement, accepts its position and agrees to all
of the obligations, responsibilities and duties imposed upon the
Trustee (or Custodian) under the Master Plan and Trust. The
Employer hereby agrees to the provisions of this Plan and Trust,
and in witness of its agreement, the Employer by its duly
authorized officers, has executed this Adoption Agreement, and
the Trustee (and Custodian, if applicable), signified its
acceptance, on this _____ day of August, 1994.
Name and EIN of Employer: KIRBY MARINE TRANSPORTATION
CORPORATION 74-1074014
Signed:
Name(s) of Trustee: Texas Commerce Bank, National Association
Signed:
Name of Custodian:
Signed:
[Note: A Trustee is mandatory, but a Custodian is optional. See
Section 10.03 of the Plan.]
Plan Number. The 3-digit plan number the Employer assigns to
this Plan for ERISA reporting purposes (From 5500 Series) is:
004.
Use of Adoption Agreement. Failure to complete properly the
elections in this Adoption Agreement may result in
disqualification of the Employer's Plan. The 3-digit number
assigned to this Adoption Agreement (see page 1) is solely for
the Master Plan Sponsor's recordkeeping purposes and does not
necessarily correspond to the plan number the Employer designated
in the prior paragraph.
Master Plan Sponsor. The Master Plan Sponsor identified on the
first page of the basic plan document will notify all adopting
employers of any amendment of this Master Plan or of any
abandonment or discontinuance by the Master Plan Sponsor of its
maintenance of this Master Plan. For inquiries regarding the
adoption of the Master Plan, the Master Plan Sponsor's intended
meaning of any plan provisions or the effect of the opinion
letter issued to the Master Plan Sponsor, please contact the
Master Plan Sponsor at the following address and telephone
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number: 600 Travis, 2nd Floor, Houston, Texas 77002, (713) 216-
6789 .
Reliance on Opinion Letter. The Employer may not rely on the
Master Plan Sponsor's opinion letter covering this Adoption
Agreement. For reliance on the Plan's qualification, the
Employer must obtain a determination letter from the applicable
IRS Key District office.
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PARTICIPATION AGREEMENT
For Participation by Related Group Members (Plan Section 1.30)
The undersigned Employer, by executing this Participation
Agreement, elects to become a Participating Employer in the Plan
identified in Section 1.03 of the accompanying Adoption
Agreement, as if the Participating Employer were a signatory to
that Agreement. The Participating Employer accepts, and agrees
to be bound by, all of the elections granted under the provisions
of the Master Plan as made by KIRBY MARINE TRANSPORTATION
CORPORATION, the Signatory Employer to the Execution Page of the
Adoption Agreement.
1. The Effective Date of the undersigned Employer's
participation in the designated Plan is: 01/01/95.
2. The undersigned Employer's adoption of this Plan
constitutes:
[ ] (a) The adoption of a new plan by the Participating
Employer.
[ ] (b) The adoption of an amendment and restatement of a plan
currently maintained by the Employer, identified as Kirby
Marine Transportation Corporation, and having an original
effective date of 01/01/86.
Dated this _____ day of _______________, 19__.
Name of Participating Employer:
Signed:
Participating Employer's EIN:
Acceptance by the Signatory Employer to the Execution Page of the
Adoption Agreement and by the Trustee.
Name of Signatory Employer: KIRBY MARINE
TRANSPORTATION
CORPORATION.
Accepted:______________
[Date] Signed:
Name(s) of Trustee:
Accepted:______________
[Date] Signed:
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[Note: Each Participating Employer must execute a separate
Participation Agreement. See the Execution Page of the Adoption
Agreement for important Master Plan information.]
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ADDENDUM 6.02(e) TO
ADOPTION AGREEMENT #011
NONSTANDARDIZED CODE Sect. 401(k) PROFIT SHARING PLAN
Additional Provisions Concerning
Qualifying Employer Securities
The following is the addendum referred to in Section 6.02(e)
of the Adoption Agreement ("Addendum"), and all defined terms
used herein shall have the same meaning as under the Plan. To
the extent that the specific provisions of this Addendum conflict
with the other provisions of the Plan, the provisions of the
Addendum shall control.
1. Investment in Kirby Corporation Common Stock.
In accordance with Section 10.03(b) of the Adoption
Agreement, the Trustee is authorized to invest all or any portion
of the Plan assets in shares ("Shares") of common stock, $0.10
par value per share ("Common Stock") of Kirby Corporation, a
Nevada corporation ("Kirby"), which shares are qualifying
Employer securities.
2. All Transactions Shall Be In A Brokers Transaction.
All purchases and sales of Shares shall be made in a brokers
transaction (within the meaning of Section 4(4) of the Securities
Act of 1933, as amended) ("Brokers Transaction"), and without
limitation, no purchases or sales shall be made directly to or
from the Employer (as defined in the Plan) or any Related
Employer (collectively, the "Employer") (other than in a Brokers
Transaction) and, again without limitation, all purchases and
sales shall be solely at the direction of a Participant as
further provided herein.
3. Carrying Out the Purchase or Sale of Shares.
The Trustee shall execute the purchase or sale of Shares as
soon as reasonably possible following the receipt of instructions
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from the Participant, and shall do so, in so far as possible, in
the same manner for all Participant's similarly situated.
4. Maintaining Confidentiality of Purchases and Sales of
Shares.
In order to maintain confidentiality of each Participant's
purchases and sales of Shares, the Trustee shall not disclose to
the Employer or to any officer or employee thereof except the
Vice-President of Human Resources of Kirby Marine Transportation
Corporation ("Confidentiality Fiduciary"), nor to any other
person known to be related to the Employer ("Related Party"), any
information relating to the purchase or sale of Shares (including
the holding of Shares previously purchased), and the Trustee
shall follow the reasonable written directions of the
Confidentiality Fiduciary with respect to matters which the
Confidentiality Fiduciary advises the Trustee in writing are
necessary to maintain the confidentiality of a Participant's
investment in Shares. Notwithstanding the foregoing, unless
otherwise advised in writing by the Confidentiality Fiduciary,
the Trustee may furnish the Employer or a Related Party with
information relating to the overall purchase, sale, voting,
tender or similar matters relating to all of the Shares held by
the Trustee so long as such information does not identify, and
cannot be reasonably anticipated as identifying, the actions of
any specific Participant with respect to such Shares.
5. Special Limitations on Officer-Participants.
Each officer of an Employer who is required to report
changes in his or her direct or indirect interest in Shares under
Section 16(a) of the Securities Exchange Act of 1934, as amended,
and who is a Participant ("Officer-Participant") will not be
entitled to instruct the Trustee to change the percentage which
are being invested in Shares of either (i) the funds in such
Officer-Participant's Account ("Investments"), or (ii) the
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Elective deferrals or Matching contributions being made to the
Plan and allocated to such Officer-Participant's Account
("Contributions"), during the 30-day period ("30-day Irrevocable
Period") immediately following the date on which such Officer-
Participant properly changes the percentage of either Investments
or Contributions being invested in Shares. Without limitation,
if agreed to by an Employer, an Officer-Participant may
voluntarily entering into an agreement with an Employer which
limits his right to change the percentage of his Contributions
being invested in Shares for a period in excess of the 30-day
Irrevocable Period. Without limitation, the Trustee shall have
no obligation to determine whether an Officer-Participant is in
compliance with any restrictions on such Officer-Participant's
change of percentage being invested in Shares with respect to
either Investments or Contributions.
6. Voting Shares.
The Trustee shall adopt procedures to insure that the voting
of Shares shall be passed through to each Participant, so that
such Participant shall be entitled and reasonably able to direct
the Trustee, in writing if so required by the Trustee, as to the
manner in which the Shares allocated to his Account are to be
voted upon any matter submitted to a vote of the stockholders of
Kirby. In the absence of a written direction from the
Participant to the Trustee, the Shares of such Participant shall
not be voted. Without limitation, the Trustee shall, to the
extent reasonably possible, act with respect to all matters
relating to the voting of Shares in such a way as to insure that
there is no disclosure to the Employer or a Related Party of a
Participant's vote; and provided, further, without limitation,
any instruction or other communication, written or oral, by a
Participant to the Trustee relating to voting of the Shares shall
be held in confidence by the Trustee and shall not be divulged to
the Employer or a Related Party.
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7. Tender Offers for Common Stock.
Upon commencement of a tender offer for Shares ("Tender
Offer"), the Employer shall notify the Trustee and shall supply
the Trustee (on an ongoing basis) with all information and other
materials as is distributed to holders of Common Stock generally
in connection with such Tender ("Tender Offer Materials"), and
the Trustee shall furnish such Tender Offer Materials to each
Participant who has Shares allocated to his Account. The Trustee
shall adopt procedures to insure that the right to Tender Shares
shall be passed through to each Participant, so that each
Participant shall be entitled and reasonably able to direct the
Trustee, in writing if so required by the Trustee, as to whether
the Shares allocated to his Account are to be Tendered. In the
absence of a written direction from the Participant to the
Trustee, the Shares of such Participant shall not be Tendered.
Without limitation, the Trustee shall, to the extent reasonably
possible, act with respect to all matters relating to the Tender
in such a way as to insure that there is no disclosure to the
Employer or a Related Party of a Participant's decision with
respect to the Tender; and provided, further, without limitation,
any instruction or other communication, written or oral, by a
Participant to the Trustee relating to the Tender shall be held
in confidence by the Trustee and shall not be divulged to the
Employer or a Related Party.
8. Distribution of Accrued Benefits.
A Participant who has invested in Shares may elect, in
writing filed with the Trustee at least 10 days prior to the date
of distribution, to receive distribution of the portion of his
Accrued Benefit attributable to Shares in the form of Shares;
provided further that, in the absence of such direction, the
Trustee shall liquidate the Participant's Shares and distribute
the proceeds.
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EXHIBIT 23.1
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INDEPENDENT AUDITORS' CONSENT
The Board of Directors
Kirby Corporation
We consent to the incorporation by reference of our reports into
the Registration Statement of Kirby Corporation on Form S-8, to
which this consent is an exhibit.
Our reports refer to changes in the methods of accounting for
income taxes, postretirement benefits other than pensions,
certain investments in debt and equity securities and accounting
and reporting for reinsurance of short-duration and long-duration
contracts.
KPMG Peat Marwick LLP
Houston, Texas
February 1, 1995
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EXHIBIT 23.2
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Exhibit 23.2
INDEPENDENT AUDITOR'S CONSENT
We consent to the incorporation by reference in this Registration
Statement of Kirby Corporation on Form S-8 of our reports dated
March 2, 1992, except for Note 2 as to which the date is March
18, 1992 (relating to Kirby Corporation and subsidiaries) and
February 28, 1994 (relating to Universal Insurance Company and
subsidiaries not presented separately herein), appearing in the
Annual Report on Form 10-K of Kirby Corporation for the year
ended December 31, 1993.
DELOITTE & TOUCHE LLP
Houston, Texas
January 31, 1995
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