CORPORATEPLAN FOR RETIREMENT 100-SM-
THE PROFIT SHARING/401(K) PLAN
FIDELITY BASIC PLAN DOCUMENT NO. 10
1.
TABLE OF CONTENTS
PAGE
ARTICLE 1 ADOPTION AGREEMENT................................................................................1
ARTICLE 2 DEFINITIONS.......................................................................................1
2.01 Definitions.....................................................................................1
ARTICLE 3 PARTICIPATION.....................................................................................7
3.01 Date of Participation...........................................................................7
3.02 Resumption of Participation Following Re employment.............................................8
3.03 Cessation or Resumption of Participation Following a Change in Status...........................8
3.04 Participation by Owner-Employee; Controlled Businesses..........................................8
3.05 Omission of Eligible Employee...................................................................9
ARTICLE 4 CONTRIBUTIONS.....................................................................................9
4.01 Deferral Contributions..........................................................................9
4.02 Additional Limit on Deferral Contributions.....................................................10
4.03 Matching Contributions.........................................................................12
4.04 Limit on Matching Contributions................................................................12
4.05 Special Rules..................................................................................15
4.06 Discretionary Employer Contributions...........................................................16
4.07 Time of Making Employer Contributions..........................................................16
4.08 Return of Employer Contributions...............................................................16
4.09 Employee Contributions.........................................................................16
4.10 Rollover Contributions.........................................................................16
4.11 Deductible Voluntary Employee Contributions....................................................17
4.12 Reserved.......................................................................................17
ARTICLE 5 PARTICIPANTS' ACCOUNTS...........................................................................17
5.01 Individual Accounts............................................................................17
5.02 Valuation of Accounts..........................................................................17
5.03 Code Section 415 Limitations...................................................................18
ARTICLE 6 INVESTMENT OF CONTRIBUTIONS......................................................................22
6.01 Manner of Investment...........................................................................22
6.02 Investment Decisions...........................................................................22
6.03 Participant Directions to Trustee..............................................................23
ARTICLE 7 RIGHT TO BENEFITS................................................................................23
7.01 Normal or Early Retirement.....................................................................23
7.02 Late Retirement................................................................................23
7.03 Disability Retirement..........................................................................24
i.
TABLE OF CONTENTS
(CONTINUED)
7.04 Death..........................................................................................24
7.05 Other Termination of Employment................................................................24
7.06 Separate Account...............................................................................24
7.07 Forfeitures....................................................................................25
7.08 Adjustment for Investment Experience...........................................................25
7.09 Participant Loans..............................................................................25
7.10 In-Service/Hardship Withdrawals................................................................27
7.11 Prior Plan In-Service Distribution Rules.......................................................28
ARTICLE 8 DISTRIBUTION OF BENEFITS PAYABLE AFTER TERMINATION OF SERVICE....................................28
8.01 Distribution of Benefits to Participants and Beneficiaries.....................................28
8.02 Annuity Distributions..........................................................................30
8.03 Joint and Survivor Annuities/Pre-retirement Survivor Annuities.................................30
8.04 Installment Distributions......................................................................32
8.05 Immediate Distributions........................................................................33
8.06 Determination of Method of Distribution........................................................34
8.09 Whereabouts of Participants and Beneficiaries..................................................35
ARTICLE 9 TOP-HEAVY PROVISIONS.............................................................................35
9.01 Application....................................................................................35
9.02 Definitions....................................................................................35
9.03 Minimum Contribution...........................................................................37
9.04 Adjustment to the Limitation on Contributions and Benefits.....................................38
9.05 Minimum Vesting................................................................................38
ARTICLE 10 AMENDMENT AND TERMINATION........................................................................38
10.01 Amendment by Employer..........................................................................38
10.02 Amendment by Prototype Sponsor.................................................................39
10.03 Amendments Affecting Vested and/or Accrued Benefits............................................39
10.04 Retroactive Amendments.........................................................................39
10.05 Termination....................................................................................39
10.06 Distribution upon Termination of the Plan......................................................40
10.07 Merger or Consolidation of Plan; Transfer of Plan Assets.......................................40
ARTICLE 11 AMENDMENT AND CONTINUATION OF PREDECESSOR PLAN; TRANSFER OF FUNDS TO OR FROM OTHER
QUALIFIED PLANS..................................................................................40
11.01 Amendment and Continuation of Predecessor Plan.................................................40
11.02 Transfer of Funds from an Existing Plan........................................................41
11.03 Acceptance of Assets by Trustee................................................................41
ii.
TABLE OF CONTENTS
(CONTINUED)
11.04 Transfer of Assets from Trust..................................................................41
ARTICLE 12 MISCELLANEOUS....................................................................................42
12.01 Communication to Participants..................................................................42
12.02 Limitation of Rights...........................................................................42
12.03 Nonalienability of Benefits and Qualified Domestic Relations Orders............................42
12.04 Facility of Payment............................................................................43
12.05 Information between Employer and Trustee.......................................................43
12.06 Effect of Failure to Qualify under Code........................................................43
12.07 Notices........................................................................................43
12.08 Governing Law..................................................................................43
12.09 Non-Discrimination Data Substantiation.........................................................43
ARTICLE 13 PLAN ADMINISTRATION..............................................................................44
13.01 Powers and Responsibilities of the Administrator...............................................44
13.02 Nondiscriminatory Exercise of Authority........................................................44
13.03 Claims and Review Procedures...................................................................44
13.04 Named Fiduciary................................................................................45
13.05 Costs of Administration........................................................................45
ARTICLE 14 TRUST AGREEMENT..................................................................................45
14.01 Acceptance of Trust Responsibilities...........................................................45
14.02 Establishment of Trust Fund....................................................................45
14.03 Exclusive Benefit..............................................................................46
14.04 Powers of Trustee..............................................................................46
14.05 Accounts.......................................................................................47
14.06 Approving of Accounts..........................................................................47
14.07 Distribution from Trust Fund...................................................................47
14.08 Transfer of Amounts from Qualified Plan........................................................47
14.09 Transfer of Assets from Trust..................................................................48
14.10 Reserved.......................................................................................48
14.11 Voting; Delivery of Information................................................................48
14.12 Compensation and Expenses of Trustee...........................................................48
14.13 Reliance by Trustee on Other Persons...........................................................48
14.14 Indemnification by Employer....................................................................49
14.15 Consultation by Trustee with Counsel...........................................................49
14.16 Persons Dealing with the Trustee...............................................................49
14.17 Resignation or Removal of Trustee..............................................................49
iii.
TABLE OF CONTENTS
(CONTINUED)
14.18 Fiscal Year of the Trust.......................................................................49
14.19 Discharge of Duties by Fiduciaries.............................................................50
14.20 Amendment......................................................................................50
14.21 Plan Termination...............................................................................50
14.22 Permitted Reversion of Funds to Employer.......................................................50
14.23 Governing Law..................................................................................50
iv.
ARTICLE 1 ADOPTION AGREEMENT
ARTICLE 2 DEFINITIONS
2.01 DEFINITIONS
(a) Wherever used herein, the following terms have the meanings set
forth below, unless a different meaning is clearly required by the
context:
(1) "Account" means an account established on the books of the
Trust for the purpose of recording contributions made on behalf
of a Participant and any income, expenses, gains or losses
incurred thereon.
(2) "Administrator" means the Employer adopting this Plan, or
other person designated by the Employer in Section 1.01(c).
(3) "Adoption Agreement" means Article 1 under which the Employer
establishes and adopts, or amends, the Plan and Trust and
designates the optional provisions selected by the Employer, and
the Trustee accepts its responsibilities under Article 14. The
provisions of the Adoption Agreement shall be an integral part of
the Plan.
(4) "Annuity Starting Date" means the first day of the first
period for which an amount is payable as an annuity or in any
other form.
(5) "Beneficiary" means the person or persons entitled under
Section 7.04 to receive benefits under the Plan upon the death of
a Participant, provided that for purposes of Section 7.04 such
term shall be applied in accordance with Section 401(a)(9) of the
Code and the regulations thereunder.
(6) "Code" means the Internal Revenue Code of 1986, as amended
from time to time.
(7) "Compensation" shall mean:
(A) for purposes of Article 4 (Contributions) other than
Section 4.02 (Additional Limit on Deferral Contributions)
and Section 4.04 (Limit on Matching Contributions),
Compensation as defined in Section 5.03(e)(2) excluding
any items elected by the Employer in Section 1.04(a),
reimbursements or other expense allowances, fringe
benefits (cash and non-cash), moving expenses, deferred
compensation and welfare benefits, but including amounts
that are not includable in the gross income of the
Participant under a salary reduction agreement by reason
of the application of Sections 125, 401(k), 402(h)(1)(B),
or 403(b) of the Code; and
(B) for purposes of Section 2.01(a)(16) (Highly
Compensated Employees), Section 4.02, Section 5.03 (Code
Section 415 Limitations), and Section 9.03 (Top Heavy Plan
Minimum Contributions), Compensation as defined in Section
5.03(e)(2).
(C) for purposes of Section 4.02 (Additional Limit on
Deferral Contributions) and Section 4.04 (Limit on
Matching Contributions), the Employer may elect
Compensation as defined in Section 2.01(a)(7)(A) or
Section 5.03(e)(2) excluding reimbursements or other
expense allowances, fringe benefits (cash and non-cash),
moving expenses, deferred compensation and welfare
benefits, but including amounts that are not includable in
the gross income of the
1.
Participant under a salary reduction agreement by reason
of the application of Section 125, 401(k), 402(h) or
403(b) of the Code.
Compensation shall generally be based on the amount actually paid
to the Participant during the Plan Year or, for purposes of
Article 4 if so elected by the Employer in Section 1.04(b),
during that portion of the Plan Year during which the Employee is
eligible to participate. Notwithstanding the preceding sentence,
Compensation for purposes of Section 5.03 (Code Section 415
Limitations) shall be based on the amount actually paid or made
available to the Participant during the Limitation Year.
Compensation for the initial Plan Year for a new Plan shall be
based upon eligible Participant Compensation, subject to Section
1.04(b), from the Effective Date listed in Section 1.01(g)(1)
through the end of the first Plan Year. In the case of any
Self-Employed Individual, Compensation shall mean the
Individual's Earned Income.
For Plan Years beginning after December 31, 1988 and before
January 1, 1994, the annual Compensation of each Participant
taken into account for determining all benefits provided under
the Plan for any determination period shall not exceed $200,000.
This limitation shall be adjusted by the Secretary at the same
time and in the same manner as under Section 415(d) of the Code,
except that the dollar increase in effect on January 1 of any
calendar year is effective for years beginning in such calendar
Year and the first adjustment to the $200,000 limitation is
effected on January 1, 1990. If a Plan determines Compensation on
a period of time that contains fewer than 12 calendar months,
then annual Compensation limit is amount equal to the annual
Compensation limit for the calendar year in which the
Compensation period begins multiplied by the ratio obtained by
dividing the number of full months in the period by 12.
In addition to other applicable limitations set forth in the
plan, and notwithstanding any other provision of the plan to the
contrary, for Plan Years beginning on or after January 1, 1994,
the annual Compensation of each Employee taken into account under
the plan shall not exceed the OBRA `93 annual Compensation limit.
The OBRA `93 annual Compensation limit is $150,000, as adjusted
by the Commissioner for increases in the cost of living in
accordance with Section 401(a)(17)(B) of the Code. The
cost-of-living adjustment in effect for a calendar year applies
to any period, not exceeding 12 months, over which Compensation
is determined (determination period) beginning in such calendar
year. If a determination period consists of fewer than 12 months,
the OBRA `93 annual Compensation limit will be multiplied by a
fraction, the numerator of which is the number of months in the
determination period, and the denominator of which is 12.
For plan years beginning on or after January 1, 1994, any
reference in this plan to the limitation under Section 401(a)(17)
of the Code shall mean the OBRA `93 annual Compensation limit set
forth in this provision. The annual Compensation limit applies
for purposes of applying the nondiscrimination rules under
Sections 401(a)(4), 401(a)(5), 401(l), 401(k)(3), 401(m)(2),
403(b)(12), 404(a)(2) and 410(b)(2) of the Code.
If Compensation for any prior determination period is taken into
account in determining an Employees' benefits accruing in the
current plan year, the Compensation for that prior determination
period is subject to the OBRA `93 annual Compensation limit in
effect for that prior determination period. For this purpose, for
determination periods beginning before the first day of the first
plan year beginning on or after January 1, 1994, the OBRA `93
annual Compensation limit is $150,000.
If Compensation for any prior determination period is taken into
account in determining an Employee's allocations or benefits for
the current determination period, the Compensation for such prior
year is subject to the applicable annual Compensation limit in
effect for that prior year. For this purpose, for years beginning
before January 1, 1990, the applicable annual Compensation limit
is $200,000.
In determining the Compensation of a Participant for purposes of
this limitation, the rules of Section 414(q)(6) of the Code shall
apply, except that in applying such rules, the term "family"
shall include only the spouse of the Participant and any lineal
descendants of the Participant who have not attained
2.
age 19 before the close of the year. If the $200,000
limitation is exceeded as a result of the application of these
rules, then the limitation shall be prorated among the
affected individuals in proportion to each such individual's
Compensation as determined under this Section prior to the
application of this limitation.
(8) "Earned Income" means the net earnings of a Self-Employed
Individual derived from the trade or business with respect to
which the Plan is established and for which the personal services
of such individual are a material income-providing factor,
excluding any items not included in gross income and the
deductions allocated to such items, except that for taxable years
beginning after December 31, 1989 net earnings shall be
determined with regard to the deduction allowed under Section
164(f) of the Code, to the extent applicable to the Employer. Net
earnings shall be reduced by contributions of the Employer to any
qualified Plan, to the extent a deduction is allowed to the
Employer for such contributions under Section 404 of the Code.
(9) "Eligibility Computation Period" means each 12-consecutive
month period beginning with the Employment Commencement Date and
each anniversary thereof or, in the case of an Employee who
before completing the eligibility requirements set forth in
Section 1.03(a)(1) incurs a break in service for participation
purposes and thereafter returns to the employ of the Employer or
Related Employer, each 12-consecutive month period beginning with
the first day of re-employment and each anniversary thereof. A
"break in service for participation purposes" shall mean an
Eligibility Computation Period during which the Participant does
not complete more than 500 Hours of Service with the Employer.
(10)"Employee" means any Employee of the Employer, any
Self-Employed Individual or Owner-Employee. The Employer must
specify in Section 1.03(a)(3) 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.
For purposes of the Plan, an individual shall be considered to
become an Employee on the date on which he first completes an
Hour of Service and he shall be considered to have ceased to be
an Employee on the date on which he last completes an Hour of
Service. The term also includes a Leased Employee, such that
contributions or benefits provided by the leasing organization
which are attributable to services performed for the Employer
shall be treated as provided by the Employer. Notwithstanding the
above, a Leased Employee shall not be considered an Employee if
Leased Employees do not constitute more than 20 percent of the
Employer's non-highly compensated work force (taking into account
all Related Employers) and the Leased Employee is covered by a
money purchase pension Plan maintained by the leasing
organization which Plan provides (i) a non integrated employer
contribution rate of at least 10 percent of Compensation, as
defined for purposes of Section 415(c)(3) of the Code, but
including amounts contributed pursuant to a salary reduction
agreement which are excludable from gross income under Section
125, Section 402(a)(8), Section 402(h) or Section 403(b) of the
Code, (ii) full and immediate vesting, and (iii) immediate
participation by each Employee of the leasing organization.
(11)"Employer" means the employer named in Section 1.02(a) and
any Related Employers required by this Section 2.01(a)(11). If
Article 1 of the Employer's Plan is the Standardized Adoption
Agreement, the term "Employer" includes all Related Employers. If
Article 1 of the Employer's Plan is the Non-standardized Adoption
Agreement, the term "Employer" includes those Related Employers
designated in Section 1.02(b).
(12)"Employment Commencement Date" means the date on which the
Employee first performs an Hour of Service.
3.
(13)"ERISA" means the Employee Retirement Income Security Act of
1974, as from time to time amended.
(14)"Fidelity Fund" means any Registered Investment Company or
Managed Income Portfolio of the Fidelity Group Trust for Employee
Benefit Plans which is made available to Plans utilizing the
CORPORATEplan FOR RETIREMENT 100-SM- Profit Sharing/401(k) Plan.
(15)"Fund Share" means the share, unit, or other evidence of
ownership in a Fidelity Fund.
(16)"Highly Compensated Employee" means both highly compensated
active Employees and highly compensated former Employees.
A highly compensated active Employee includes any Employee who
performs service for the Employer during the determination year
and who, during the look-back year: (i) received Compensation
from the Employer in excess of $75,000 (as adjusted pursuant to
Section 415(d) of the Code); (ii) received Compensation from the
Employer in excess of $50,000 (as adjusted pursuant to Section
415(d) of the Code) and was a member of the top-paid group for
such year; or (iii) was an officer of the Employer and received
Compensation during such year that is greater than 50 percent of
the dollar limitation in effect under Section 415(b)(1)(A) of the
Code. The term highly compensated Employee also includes: (i)
Employees who are both described in the preceding sentence if the
term "determination year" is substituted for the term "look-back
year" and the Employee is one of the 100 Employees who received
the most Compensation from the Employer during the determination
year; and (ii) Employees who are 5 percent owners at any time
during the look-back year or determination year. If no officer
has satisfied the Compensation requirement of (iii) above during
either a determination year or look-back year, the highest paid
officer for such year shall be treated as a highly compensated
Employee. For this purpose, the determination year shall be the
Plan Year. The look-back year shall be the twelve-month period
immediately preceding the determination year. The Employer may
elect to make the look-back year calculation for a determination
on the basis of the calendar year ending with or within the
applicable determination year, as prescribed by Section 414(q) of
the Code and the regulations issued thereunder. A highly
compensated former Employee includes any Employee who separated
from service (or was deemed to have separated) prior to the
determination year, performs no service for the Employer during
the determination year, and was a highly compensated active
Employee for either the separation year or any determination year
ending on or after the Employee's 55th birthday.
If an Employee is, during a determination year or look-back year,
a family member of either a 5 percent owner who is an active or
former Employee or a highly compensated Employee who is one of
the 10 most highly compensated Employees ranked on the basis of
Compensation paid by the Employer during such year, then the
family member and the 5 percent owner or top-ten highly
compensated Employee shall be aggregated. In such case, the
family member and 5 percent owner or top-ten highly compensated
Employee shall be treated as a single Employee receiving
Compensation and Plan contributions or benefits equal to the sum
of such Compensation and contributions or benefits of the family
member and 5 percent owner or top-ten highly compensated
Employee. For purposes of this Section, family member includes
the spouse, lineal ascendants and descendants of the Employee or
former Employee and the spouses of such lineal ascendants and
descendants.
The determination of who is a highly compensated Employee,
including the determinations of the number and identity of
Employees in the top-paid group, the top 100 Employees, the
number of Employees treated as officers and the Compensation that
is considered, will be made in accordance with Section 414(q) of
the Code and the regulations thereunder.
The determination of who is a highly compensated Employee may be
made pursuant to Internal Revenue Service Revenue Procedure
93-42, "Data Substantiation Guidelines and Non-Discrimination
Requirements, of Section 401(a)(4), 410(b), and Related Code
Sections" and subsequent regulations.
(17)"Hour of Service" means, with respect to any Employee,
4.
(A) Each hour for which the Employee is directly or
indirectly paid, or entitled to payment, for the
performance of duties for the Employer or a Related
Employer, each such hour to be credited to the Employee
for the Eligibility Computation Period in which the duties
were performed;
(B) Each hour for which the Employee is directly or
indirectly paid, or entitled to payment, by the Employer
or Related Employer (including payments made or due from a
trust fund or insurer to which the Employer contributes or
pays premiums) on account of a period of time during which
no duties are performed (irrespective of whether the
employment relationship has terminated) due to vacation,
holiday, illness, incapacity, disability, layoff, jury
duty, military duty, or leave of absence, each such hour
to be credited to the Employee for the Eligibility
Computation Period in which such period of time occurs,
subject to the following rules:
(i) No more than 501 Hours of Service shall be
credited under this paragraph (B) on account of any
single continuous period during which the Employee
performs no duties;
(ii) Hours of Service shall not be credited under
this paragraph (B) for a payment which solely
reimburses the Employee for medically-related
expenses, or which is made or due under a Plan
maintained solely for the purpose of complying with
applicable workmen's Compensation, unemployment
Compensation or disability insurance laws; and
(iii) If the period during which the Employee
performs no duties falls within two or more
Eligibility Computation Periods and if the payment
made on account of such period is not calculated on
the basis of units of time, the Hours of Service
credited with respect to such period shall be
allocated between not more than the first two such
Eligibility Computation Periods on any reasonable
basis consistently applied with respect to
similarly situated Employees; and
(C) Each hour not counted under paragraph (A) or (B) for
which back pay, irrespective of mitigation of damages, has
been either awarded or agreed to be paid by the Employer
or a Related Employer, each such hour to be credited to
the Employee for the Eligibility Computation Period to
which the award or agreement pertains rather than the
Eligibility Computation Period in which the award
agreement or payment is made.
For purposes of determining Hours of Service, Employees of
the Employer and of all Related Employers will be treated
as employed by a single employer. For purposes of
paragraphs (B) and (C) above, Hours of Service will be
calculated in accordance with the provisions of Section
2530.200b-2(b) of the Department of Labor regulations which
are incorporated herein by reference.
Solely for purposes of determining whether a break in
service for participation purposes has occurred in a
computation period, an individual who is absent from work
for maternity or paternity reasons shall receive credit for
the hours of service which would otherwise been credited to
such individual but for such absence, or in any case in
which such hours cannot be determined, 8 hours of service
per day of such absence. For purposes of this paragraph, an
absence from work for maternity reasons means an absence
(1) by reason of the pregnancy of the individual, (2) by
reason of a birth of a child of the individual, (3) by
reason of the placement of a child with the individual in
connection with the adoption of such child by such
individual, or (4) for purposes of caring for such child
for a period beginning immediately following such birth or
placement. The hours of service credited under this
paragraph shall be credited (1) in the computation period
in which the absence begins if the crediting is necessary
to prevent a break in service in that period, or (2) in all
other cases, in the following computation period.
5.
(18)"Leased Employee" means any individual who provides services
to the Employer or a Related Employer (the "recipient") but is
not otherwise an Employee of the recipient if (i) such services
are provided pursuant to an agreement between the recipient and
any other person (the "leasing organization"), (ii) such
individual has performed services for the recipient (or for the
recipient and any related persons within the meaning of Section
414(n)(6) of the Code) on a substantially full-time basis for at
least one year, and (iii) such services are of a type
historically performed by Employees in the business field of the
recipient.
(19)"Normal Retirement Age" means the normal retirement age
specified in Section 1.06(a) of the Adoption Agreement. If the
Employer enforces a mandatory retirement age, the Normal
Retirement Age is the lesser of that mandatory age or the age
specified in Section 1.06(a).
(20)"Owner-Employee" means, if the Employer is a sole
proprietorship, the individual who is the sole proprietor, or if
the Employer is a partnership, a partner who owns more than 10
percent of either the capital interest or the profits interest of
the partnership.
(21)"Participant" means any Employee who participates in the Plan
in accordance with Article 3 hereof.
(22)"Plan" means the Plan established by the Employer in the form
of the prototype Plan as set forth herein as a new Plan or as an
amendment to an existing Plan, by executing the Adoption
Agreement, together with any and all amendments hereto.
(23)"Plan Year" means the 12-consecutive month period designated
by the Employer in Section 1.01(f).
(24)"Prototype Sponsor" means Fidelity Management and Research
Company, or its successor.
(25)"Registered Investment Company" means any one or more
corporations, partnerships or trusts registered under the
Investment Company Act of 1940 for which Fidelity Management and
Research Company serves as investment advisor.
(26)"Related Employer" means any employer other than the Employer
named in Section 1.02(a), if the Employer and such other employer
are members of a controlled group of corporations (as defined in
Section 414(b) of the Code) or an affiliated service group (as
defined in Section 414(m)), or are trades or businesses (whether
or not incorporated) which are under common control (as defined
in Section 414(c)), or such other employer is required to be
aggregated with the Employer pursuant to regulations issued under
Section 414(o).
(27)"Self-Employed Individual" means an individual who has Earned
Income for the taxable year from the Employer or who would have
had Earned Income but for the fact that the trade or business had
no net profits for the taxable year.
(28)"Trust" means the trust created by the Employer in
accordance with the provisions of Section 14.01.
(29)"Trust Agreement" means the agreement between the Employer
and the Trustee, as set forth in Article 14, under which the
assets of the Plan are held, administered, and managed.
(30)"Trust Fund" means the property held in Trust by the Trustee
for the Accounts of the Participants and their Beneficiaries.
(31)"Trustee" means the Fidelity Management Trust Company, or
its successor.
6.
(32)"Year of Service for Participation" means, with respect to
any Employee, an Eligibility Computation Period during which the
Employee has been credited with at least 1,000 Hours of Service.
If the Plan maintained by the Employer is the Plan of a
predecessor employer, an Employee's Years of Service for
Participation shall include years of service with such
predecessor employer. In any case in which the Plan maintained by
the Employer is not the Plan maintained by a predecessor
employer, service for such predecessor shall be treated as
service for the Employer, to the extent provided in Section 1.08.
(33)"Years of Service for Vesting" means, with respect to any
Employee, the number of whole years of his periods of service
with the Employer or a Related Employer (the elapsed time method
to compute vesting service). An Employee will receive credit for
the aggregate of all time period(s) commencing with the
Employee's Employment Commencement Date and ending on the date a
break in service begins. An Employee will also receive credit for
any period of severance of less than 12 consecutive months.
Fractional periods of a year will be expressed in terms of days.
In the case of a Participant who has 5 consecutive 1-year breaks
in service, all years of service after such breaks in service
will be disregarded for the purpose of vesting the
Employer-derived account balance that accrued before such breaks,
but both pre-break and post-break service will count for the
purposes of vesting the Employer-derived account balance that
accrues after such breaks. Both accounts will share in the
earnings and losses of the fund. In the case of a Participant who
does not have 5 consecutive 1-year breaks in service, both the
pre-break and post-break service will count in vesting both the
pre-break and post-break employer-derived account balance. A
break in service is a period of severance of at least 12
consecutive months. Period of severance is a continuous period of
time during which the Employee is not employed by the Employer.
Such period begins on the date the Employee retires, quits or is
discharged, or if earlier, the 12 month anniversary of the date
on which the Employee was otherwise first absent from service.
In the case of an individual who is absent from work for
maternity or paternity reasons, the 12-consecutive month period
beginning on the first anniversary of the first date of such
absence shall not constitute a break in service. For purposes of
this paragraph, an absence from work for maternity or paternity
reasons means an absence (l) by reason of the pregnancy of the
individual, (2) by reason of the birth of a child of the
individual, (3) by reason of the placement of a child with the
individual in connection with the adoption of such child by such
individual, or (4) for purposes of caring for such child for a
period beginning immediately following such birth or placement.
If the Plan maintained by the Employer is the Plan of a
predecessor employer, an Employee's Years of Service for Vesting
shall include years of service with such predecessor employer. In
any case in which the Plan maintained by the Employer is not the
Plan maintained by a predecessor employer, service for such
predecessor shall be treated as service for the Employer to the
extent provided in Section 1.08.
(b) Pronouns used in the Plan are in the masculine gender but include
the feminine gender unless the context clearly indicates otherwise.
ARTICLE 3 PARTICIPATION
3.01 DATE OF PARTICIPATION
All Employees in the eligible class (as defined in Section 1.03(a)(3)) who are
in the service of the Employer on the Effective Date will become Participants on
the date elected by the Employer in Section 1.03(c). Any other Employee will
become a Participant in the Plan as of the first Entry Date on which he first
satisfies the eligibility requirements set forth in Section 1.03(a). In the
event that an Employee who is not a member of an eligible class (as defined in
Section 1.03(a)(3)) becomes a member of an eligible class, the individual shall
participate immediately if such
7.
individual had already satisfied the eligibility requirements and would have
otherwise previously become a Participant.
If an eligibility requirement other than one Year of Service is elected in
1.03(a)(1), an Employee may not be required to complete a minimum number of
Hours of Service before becoming a Participant. An otherwise eligible Employee
subject to a minimum months of service requirement shall become a Participant on
the first Entry Date following his completion of the required number of
consecutive months of employment measured from his Employment Commencement Date
to the coinciding date in the applicable following month. For purposes of
determining consecutive months of service, the Related Employer and predecessor
employer rules contained in Sections 2.01(a)(17) and 2.01(a)(32) shall apply.
3.02 RESUMPTION OF PARTICIPATION FOLLOWING RE EMPLOYMENT
If a Participant ceases to be an Employee and thereafter returns to the employ
of the Employer he will be treated as follows:
(a) he will again become a Participant on the first date on which he
completes an Hour of Service for the Employer following his reemployment
and is in the eligible class of Employees as defined in Section
1.03(a)(3), and
(b) any distribution which he is receiving under the Plan will cease
except as otherwise required under Section 8.08.
3.03 CESSATION OR RESUMPTION OF PARTICIPATION FOLLOWING A CHANGE IN STATUS
If any Participant continues in the employ of the Employer or Related Employer
but ceases to be a member of an eligible class as defined in Section 1.03(a)(3),
the individual shall continue to be a Participant for most purposes until the
entire amount of his benefit is distributed; however, the individual shall not
be entitled to receive an allocation of contributions or forfeitures during the
period that he is not a member of the eligible class. Such Participant shall
continue to receive credit for service completed during the period for purposes
of determining his vested interest in his Accounts. In the event that the
individual subsequently again becomes a member of an eligible class of
Employees, the individual shall resume full participation immediately upon the
date of such change in status.
3.04 PARTICIPATION BY OWNER-EMPLOYEE; CONTROLLED BUSINESSES
If the Plan provides contributions or benefits for one or more Owner-Employees
who control both the trade or business with respect to which the Plan is
established and one or more other trades or businesses, the Plan and any Plan
established with respect to such other trades or businesses must, when looked at
as a single Plan, satisfy Sections 401(a) and 401(d) of the Code with respect to
the Employees of this and all such other trades or businesses. If the Plan
provides contributions or benefits for one or more Owner-Employees who control
one or more other trades or businesses, the Employees of each such other trade
or business must be included in a Plan which satisfies Sections 401(a) and
401(d) of the Code and which provides contributions and benefits not less
favorable than provided for Owner-Employees under the Plan.
If an individual is covered as an Owner-Employee under the Plans of two or more
trades or businesses which are not controlled and the individual controls a
trade or business, then the contributions or benefits of the Employees under the
Plan of the trades or businesses which are controlled must be as favorable as
those provided for him under the most favorable Plan of the trade or business
which is not controlled.
For purposes of this; Section, an Owner-Employee, or two or more
Owner-Employees, shall be considered to control a trade or business if such
Owner-Employee, or such Owner-Employees together, (i) own the entire interest in
an
8.
unincorporated trade or business, or (ii) in the case of a partnership, own
more than 50 percent of either the capital interest or the profits interest
in such partnership. For this purpose, an Owner-Employee, or two or more
Owner-Employees, shall be treated as owning any interest in a partnership
which is owned, directly or indirectly, by a partnership controlled by such
Owner-Employee or such Owner-Employees.
3.05 OMISSION OF ELIGIBLE EMPLOYEE
If any Employee who should be included as a Participant in the Plan is
erroneously omitted and discovery of such omission is not made until after a
contribution by his Employer for the year has been made, the Employer shall make
a subsequent contribution, if necessary, so that the omitted Employee receives
the total amount which the said Employee would have received had he not been
omitted. For purposes of this Section 3.05, the term "contribution" shall not
include Deferral Contributions and Matching Contributions made pursuant to
Sections 4.01 and 4.03, respectively.
ARTICLE 4 CONTRIBUTIONS
4.01 DEFERRAL CONTRIBUTIONS
(a) DEFERRAL CONTRIBUTIONS. If so provided by the Employer in Section
1.05(b), each Participant may elect to execute a salary reduction
agreement with the Employer to reduce his Compensation by a specified
percentage not exceeding 15% per payroll period, subject to any
exceptions elected by the Employer in Section 1.05(b)(2) and equal to a
whole number multiple of one (1) percent. Such agreement shall become
effective on the first day of the first payroll period for which the
Employer can reasonably process the request. The Employer shall make a
Deferral Contribution on behalf of the Participant corresponding to the
amount of said reduction, subject to the restrictions set forth below.
Under no circumstances may a salary reduction agreement be adopted
retroactively.
(b) A Participant may elect to change or discontinue the percentage by
which his Compensation is reduced by notice to the Employer as provided
in Section 1.05(b)(1).
(c) No Participant shall be permitted to have Deferral Contributions
made under the Plan, or any other qualified Plan maintained by the
Employer, during the taxable year, in excess of the dollar limitation
contained in Section 402(g) of the Code in effect at the beginning of
such taxable year. A Participant may assign to the Plan any Excess
Deferrals made during the taxable year of the Participant by notifying
the Plan Administrator on or before March 15 following the taxable year
of the amount of the Excess Deferrals to be assigned to the Plan. A
Participant is deemed to notify the Administrator of any Excess
Deferrals that arise by taking into account only those Deferral
Contributions made to the Plan and any other Plan of the Employer.
Notwithstanding any other provision of the Plan, Excess Deferrals, plus
any income and minus any loss allocable thereto, shall be distributed no
later than April 15 to any Participant to whose account Excess Deferrals
were so assigned for the preceding year and who claims Excess Deferrals
for such taxable year. A Participant is deemed to notify the
Administrator of any Excess Deferrals that arise by taking into account
only those Deferred Contributions made to this Plan and any other plans
of the Employer.
"Excess Deferrals" shall mean those Deferral Contributions that are
includable in a Participant's gross income under Section 402(g) of the
Code to the extent such Participant's Deferral Contributions for a
taxable year exceed the dollar limitation under such Code section. For
purposes of determining Excess Deferrals, the term "Deferral
Contributions" shall include the sum of all Employer Contributions made
on behalf of such Participant pursuant to an election to defer under any
qualified CODA as described in Section 401(k) of the Code, any
simplified Employee pension cash or deferred arrangement as described in
Section 402(h)(1)(B) of the Code, any eligible deferred Compensation
Plan under Section 457, any Plan as described under Section 501(c)(18)
of the Code, and any Employer Contributions made on the behalf of a
Participant for the purchase of an annuity contract under Section 403(b)
of the Code pursuant to a salary reduction agreement. Deferral
9.
Contributions shall not include any deferrals properly distributed as
excess annual additions. Excess Deferrals shall be treated as annual
additions under the Plan, unless such amounts are distributed no later
than the first April 15 following the close of the Participant's taxable
year. Deferral Contributions shall not include any deferrals properly
distributed as excess annual additions.
Excess Deferrals shall be adjusted for any income or loss up to the date
of distribution. The income or loss allocable to Excess Deferrals is (1)
income or loss allocable to the Participant's Deferral Contributions
account for the taxable year multiplied by a fraction, the numerator of
which is such Participant's Excess Deferrals for the year and the
denominator is the Participant's account balance attributable to
Deferral Contributions without regard to any income or loss occurring
during such taxable year, or (2) such other amount determined under any
reasonable method, provided that such method is used consistently for
all Participants in calculating the distributions required under this
Section 4.01(c) and Sections 4.02(d) and 4.04(d) for the Plan Year, and
is used by the Plan in allocating income or loss to Participants'
accounts. Income or loss allocable to the period between the end of the
Plan Year and the date of distribution shall be disregarded in
determining income or loss.
(d) In order for the Plan to comply with the requirements of Sections
401(k), 402(g) and 415 of the Code and the regulations promulgated
thereunder, at any time in a Plan Year the Administrator may reduce the
rate of Deferral Contributions to be made on behalf of any Participant,
or class of Participants, for the remainder of that Plan Year, or the
Administrator may require that all Deferral Contributions to be made on
behalf of a Participant be discontinued for the remainder of that Plan
Year. Upon the close of the Plan Year or such earlier date as the
Administrator may determine, any reduction or discontinuance in Deferral
Contributions shall automatically cease until the Administrator again
determines that such a reduction or discontinuance of Deferral
Contributions is required.
4.02 ADDITIONAL LIMIT ON DEFERRAL CONTRIBUTIONS
(a) The Actual Deferral Percentage (hereinafter "ADP") for Participants
who are Highly Compensated Employees for each Plan Year and the ADP for
Participants who are Non-highly Compensated Employees for the same Plan
Year must satisfy one of the following tests:
(1) The ADP for Participants who are Highly Compensated Employees
for the Plan Year shall not exceed the ADP for Participants who
are Non-highly Compensated Employees for the same Plan Year
multiplied by 1.25; or
(2) The ADP for Participants who are Highly Compensated Employees
for the Plan Year shall not exceed the ADP for Participants who
are Non-highly Compensated Employees for the same Plan Year
multiplied by 2.0, provided that the ADP for Participants who are
Highly Compensated Employees does not exceed the ADP for
Participants who are Non-highly Compensated Employees by more
than two (2) percentage points.
(b) The following special rules apply for the purposes of this Section:
(1) The ADP for any Participant who is a Highly Compensated
Employee for the Plan Year and who is eligible to have Deferral
Contributions (and Qualified Discretionary Contributions if
treated as Deferral Contributions for purposes of the ADP test)
allocated to his or her accounts under two or more arrangements
described in Section 401(k) of the Code, that are maintained by
the Employer, shall be determined as if such Deferral
Contributions (and, if applicable, such Qualified Discretionary
Contributions) were made under a single arrangement. If a Highly
Compensated Employee participates in two or more cash or deferred
arrangements that have different Plan Years, all cash or deferred
arrangements ending with or within the same calendar year shall
be treated as a single arrangement. Notwithstanding the
foregoing, certain Plans shall be treated as separate if
mandatorily disaggregated under regulations under Section 401(k)
of the Code.
10.
(2) In the event that this Plan satisfies the requirements of
Sections 401(k), 401(a)(4), or 410(b) of the Code only if
aggregated with one or more other Plans, or if one or more other
Plans satisfy the requirements of such Sections of the Code only
if aggregated with this Plan, then this Section shall be applied
by determining the ADP of Employees as if all such Plans were a
single Plan. For Plan Years beginning after December 31, 1989,
Plans may be aggregated in order to satisfy section 401(k) of the
Code only if they have the same Plan Year.
(3) For purposes of determining the ADP of a Participant who is a
5-percent owner or one of the ten most highly-paid Highly
Compensated Employees, the Deferral Contributions (and Qualified
Discretionary Contributions if treated as Deferral Contributions
for purposes of the ADP test) and Compensation of such
Participant shall include the Deferral Contributions (and, if
applicable, Qualified Discretionary Contributions) and
Compensation for the Plan Year of Family Members (as defined in
Section 414(q)(6) of the Code). Family Members, with respect to
such Highly Compensated Employees, shall be disregarded as
separate Employees in determining the ADP both for Participants
who are Non-highly Compensated Employees and for Participants who
are Highly Compensated Employees.
(4) For purposes of determining the ADP test, Deferral
Contributions and Qualified Discretionary Contributions must be
made before the last day of the twelve-month period immediately
following the Plan Year to which contributions relate.
(5) The Employer shall maintain records sufficient to demonstrate
satisfaction of the ADP test and the amount of Qualified
Discretionary Contributions used in such test.
(6) The determination and treatment of the ADP amounts of any
Participant shall satisfy such other requirements as may be
prescribed by the Secretary of the Treasury.
(c) The following definitions shall apply for purposes of this Section:
(1) "Actual Deferral Percentage" shall mean, for a specified
group of Participants for a Plan Year, the average of the ratios
(calculated separately for each Participant in such group) of (1)
the amount of Employer contributions actually paid over to the
trust on behalf of such Participant for the Plan Year to (2) the
Participant's Compensation for such Plan Year. Employer
contributions on behalf of any Participant shall include: (1) any
Deferral Contributions made pursuant to the Participant's
deferral election, including Excess Deferrals of Highly
Compensated Employees, but excluding (a) Excess Deferrals of
Non-Highly Compensated Employees that arise solely from Deferral
Contributions made under the Plan or Plans of the Employer and
(b) Deferral Contributions that are taken into account in the
Contribution Percentage test (provided the ADP test is satisfied
both with and without exclusion of these Deferral Contributions);
and (2) at the election of the Employer, Qualified Discretionary
Contributions. Matching Contributions, whether or not
non-forfeitable when made, shall not be considered as Employer
Contributions for purposes of this paragraph. For purposes of
computing Actual Deferral Percentages, an Employee who would be a
Participant but for the failure to make Deferral Contributions
shall be treated as a Participant on whose behalf no Deferral
Contributions are made.
(2) "Excess Contributions" shall mean, with respect to any Plan
Year, the excess of:
(A) The aggregate amount of Employer contributions
actually taken into account in computing the ADP of Highly
Compensated Employees for such Plan Year, over
(B) The maximum amount of such contributions permitted by
the ADP test (determined by reducing contributions made on
behalf of Highly Compensated Employees in order of the
ADPs, beginning with the highest of such percentages).
11.
(3) "Qualified Discretionary Contributions" shall mean
contributions made by the Employer as elected in Section
1.05(b)(3) and allocated to Participant accounts of Non-highly
Compensated Employees that such Participants may not elect to
receive in cash until distributed from the Plan; that are
nonforfeitable when made; and that are distributable only in
accordance with the distribution provisions that are applicable
to Deferral Contributions. Participants shall not be required to
satisfy any hours of service or employment requirement in order
to receive an allocation of such contributions.
(d) Notwithstanding any other provision of this Plan, Excess
Contributions, plus any income and minus any loss allocable thereto,
shall be distributed no later than the last day of each Plan Year to
Participants to whose accounts such Excess Contributions were allocated
for the preceding Plan Year. If such excess amounts are distributed more
than 2-1/2 months after the last day of the Plan Year in which such
excess amounts arose, a ten (10) percent excise tax will be imposed on
the employer maintaining the Plan with respect to such amounts. Such
distributions shall be made to Highly Compensated Employees on the basis
of the respective portions of the Excess Contributions attributable to
each of such Employees. Excess Contributions of Participants who are
subject to the family member aggregation rules of Section 414(q)(6) of
the Code shall be allocated among the family members in proportion to
the Deferral Contributions (and amounts treated as Deferral
Contributions) of each family member that is combined to determine the
combined ADP.
Excess Contributions shall be treated as annual additions under the
Plan. Excess Contributions shall be adjusted for any income or loss up
to the date of distribution. The income or loss allocable to Excess
Contributions is (1) income or loss allocable to the Participant's
Deferral Contribution account (and if applicable, the Qualified
Discretionary Contribution account) for the Plan Year multiplied by a
fraction, the numerator of which is such Participant's Excess
Contributions for the year and the denominator is the Participant's
account balance attributable to Deferral Contributions without regard to
any income or loss occurring during such Plan Year, or (2) an amount
determined under any reasonable method, provided that such method is
used consistently for all Participants in calculating any distributions
required under Section 4.02(d) and Sections 4.01(c) and 4.04(d) for the
Plan Year, and is used by the Plan in allocating income or loss to the
Participants' accounts. Income or loss allocable to the period between
the end of the Plan Year and the date of distribution shall be
disregarded in determining income or loss.
Excess Contributions shall be distributed from the Participant's
Qualified Discretionary. Contribution account only to the extent that
such Excess Contributions exceed the balance in the Participant's
Deferral Contributions account.
4.03 MATCHING CONTRIBUTIONS
If so provided by the Employer in Section 1.05(c), the Employer shall make a
Matching Contribution on behalf of each Participant who had Deferral
Contributions made on his behalf during the year in accordance with Section
1.05(c)(3). The amount of the Matching Contribution shall be determined in
accordance with Section 1.05(c)(1), subject to the limitations set forth in
Section 4.04 and Section 404 of the Code.
4.04 LIMIT ON MATCHING CONTRIBUTIONS
(a) The Average Contribution Percentage (hereinafter "ACP") for
Participants who are Highly Compensated Employees for each Plan Year and
the ACP for Participants who are Non-highly Compensated Employees for
the same Plan Year must satisfy one of the following tests:
(1) The ACP for Participants who are Highly Compensated Employees
for the Plan Year shall not exceed the ACP for Participants who
are Non-highly Compensated Employees for the same Plan Year
multiplied by 1.25; or
12.
(2) The ACP for Participants who are Highly Compensated Employees
for the Plan Year shall not exceed the ACP for Participants who
are Non-highly Compensated Employees for the same Plan Year
multiplied by two (2), provided that the ACP for Participants who
are Highly Compensated Employees does not exceed the ACP for
Participants who are Non-highly Compensated Employees by more
than two (2) percentage points.
(b) The following special rules apply for purposes of this section:
(1) If one or more Highly Compensated Employees participate in
both a qualified cash or deferred arrangement described in
Section 401(k) of the Code (hereafter "CODA") and a Plan subject
to the ACP test maintained by the Employer and the sum of the ADP
and ACP of those Highly Compensated Employees subject to either
or both tests exceeds the Aggregate Limit, then the ACP of those
Highly Compensated Employees who also participate in a CODA will
be reduced (beginning with such Highly Compensated Employee whose
ACP is the highest) so that the limit is not exceeded. The amount
by which each Highly Compensated Employee's Contribution
Percentage Amounts is reduced shall be treated as an Excess
Aggregate Contribution. The ADP and ACP of the Highly Compensated
Employees are determined after any corrections required to meet
the ADP and ACP tests. Multiple use does not occur if either the
ADP or ACP of the Highly Compensated Employees does not exceed
1.25 multiplied by the ADP and ACP of the Non-highly Compensated
Employees.
(2) For purposes of this section, the Contribution Percentage for
any Participant who is a Highly Compensated Employee and who is
eligible to have Contribution Percentage Amounts allocated to his
or her account under two or more Plans described in section
401(a) of the Code, or arrangements described in section 401(k)
of the Code that are maintained by the Employer, shall be
determined as if the total of such Contribution Percentage
Amounts was made under each Plan. If a Highly Compensated
Employee participates in two or more cash or deferred
arrangements that have different Plan years, all cash or deferred
arrangements ending with or within the same calendar year shall
be treated as a single arrangement. Notwithstanding the
foregoing, certain Plans shall be treated as separate if
mandatorily disaggregated under regulations under Section 401(m)
of the Code.
(3) In the event that this Plan satisfies the requirements of
Sections 401(m), 401(a)(4) or 410(b) of the Code only if
aggregated with one or more other Plans, or if one or more other
Plans satisfy the requirements of such sections of the Code only
if aggregated with this Plan, then this section shall be applied
by determining the Contribution Percentage of Employees as if all
such Plans were a single Plan. For Plan years beginning after
December 31, 1989, Plans may be aggregated in order to satisfy
Section 401(m) of the Code only if they have the same Plan Year.
(4) For purposes of determining the Contribution percentage of a
Participant who is a five-percent owner or one of the ten most
highly-paid Highly Compensated Employees, the Contribution
Percentage Amounts and Compensation of such Participant shall
include the Contribution Percentage Amounts and Compensation for
the Plan Year of Family Members (as defined in Section 414(q)(6)
of the Code). Family Members, with respect to Highly Compensated
Employees, shall be disregarded as separate Employees in
determining the Contribution Percentage both for Participants who
are Non-highly Compensated Employees and for Participants who are
Highly Compensated Employees.
(5) For purposes of determining the Contribution Percentage test,
Matching Contributions and Qualified Discretionary Contributions
will be considered made for a Plan Year if made no later than the
end of the twelve-month period beginning on the day after the
close of the Plan Year.
(6) The Employer shall maintain records sufficient to demonstrate
satisfaction of the ACP test and the amount of Qualified
Discretionary Contributions used in such test.
(7) The determination and treatment of the Contribution
Percentage of any Participant shall satisfy such other
requirements as may be prescribed by the Secretary of Treasury.
13.
(c) The following definitions shall apply for purposes of this Section:
(1) "Aggregate Limit" shall mean the greater of (A) or (B) where
(A) is the sum of (i) 125 percent of the greater of the ADP of
the Non-highly Compensated Employees for the Plan Year or the ACP
of Non-highly Compensated Employees under the Plan subject to
Section 401(m) of the Code for the Plan Year beginning with or
within the Plan Year of the CODA and (ii) the lesser of 200% or
two plus the lesser of such ADP or ACP and where (B) is the sum
of (i) 125 percent of the lesser of the ADP of the Non-highly
Compensated Employees for the Plan Year or the ACP of Non-highly
Compensated Employees under the Plan subject to Section 401(m) of
the Code for the Plan Year beginning with or within the Plan Year
of the CODA and (ii) the lesser of 200% or two plus the greater
of such ADP or ACP.
(2) "Average Contribution Percentage" or "ACP" shall mean the
average of the Contribution Percentages of the Eligible
Participants in a group.
(3) "Contribution Percentage" shall mean the ratio (expressed as
a percentage) of the Participant's Contribution Percentage
Amounts to the Participant's Compensation for the Plan Year.
(4) "Contribution Percentage Amounts" shall mean the sum of
Matching Contributions made under the Plan on behalf of the
Participant for the Plan Year. Such Contribution Percentage
Amounts shall not include Matching Contributions that are
forfeited either to correct Excess Aggregate Contributions or
because the contributions to which they relate are Excess
Deferrals, Excess Contributions or Excess Aggregate
Contributions. If so elected by the Employer in Section
1.05(b)(3), the Employer may include Qualified Discretionary
Contributions in the Contribution Percentage Amounts. The
Employer also may elect to use Deferral Contributions in the
Contribution Percentage Amounts so long as the ADP test is met
before the Deferral Contributions are used in the ACP test and
continues to be met following the exclusion of those Deferral
Contributions that are used to meet the ACP test.
(5) "Deferral Contribution" shall mean any contribution made at
the election of the Participant pursuant to a salary reduction
agreement in accordance with Section 4.01(a).
(6) "Eligible Participant" shall mean any Employee who is
eligible to make an Employee Contribution or a Deferral
Contribution (if the employer takes such contributions into
account in the calculation of the Contribution Percentage), or to
receive a Matching Contribution.
(7) Reserved
(8) "Matching Contribution" shall mean an Employer Contribution
made to this or any other defined contribution Plan on behalf of
a Participant on account of a Participant's Deferral
Contribution.
(9) "Excess Aggregate Contributions" shall mean, with respect to
any Plan Year, the excess of:
(A) The aggregate Contribution Percentage Amounts taken
into account in computing the numerator of the
Contribution Percentage actually made on behalf of Highly
Compensated Employees for such Plan Year, over
(B) The maximum Contribution Percentage Amounts permitted
by the ACP test (determined by reducing contributions made
on behalf of Highly Compensated Employees in order of
their Contribution Percentages beginning with the highest
of such percentages).
Such determination shall be made after first determining
Excess Deferrals pursuant to Section 4.01 and then
determining Excess Contributions pursuant to Section 4.02.
(d) Notwithstanding any other provision of the Plan, Excess Aggregate
Contributions, plus any income and minus any loss allocable thereto,
shall be forfeited, if forfeitable, or if not forfeitable, distributed
no later than
14.
the last day of each Plan Year to Participants to whose accounts such
Excess Aggregate Contributions were allocated for the preceding Plan
Year. Excess Aggregate Contributions of Participants who are subject
to the family member aggregation rules of Section 414(q)(6) of the
Code shall be allocated among the family members in proportion
Matching Contributions of each family member that is combined to
determine the: combined ACP. If such Excess Aggregate Contributions
are distributed more than 2-1/2 months after the last day of the Plan
Year in which such excess amounts arose, a ten (10) percent excise
tax will be imposed on the employer maintaining the Plan with respect
to those amounts. Excess Aggregate Contributions shall be treated as
annual additions under the Plan.
Excess Aggregate Contributions shall be adjusted for any income or loss
up to the date of distribution. The income or loss allocable to Excess
Aggregate Contributions is (1) income or loss allocable to the
Participant's Matching Contribution account (if any, and if all amounts
therein are not used in the ADP test) and if applicable, Qualified
Non-elective Contribution account for the Plan Year multiplied by a
fraction, the numerator of which is such Participant's Excess Aggregate
Contributions for the year and the denominator is the Participant's
account balance(s) attributable to Contribution Percentage Amounts
without regard to income or loss occurring during such Plan Year, or (2)
such other amount determined under any reasonable method, provided that
such method is used consistently for all Participants in calculating any
distributions required under Section 4.04(d) and Sections 4.01(c) and
4.02(d) for the Plan Year, and is used by the Plan in allocating income
or loss to the Participants' accounts. Income or loss allocable to the
period between the end of the Plan Year and the date of distribution
shall be disregarded in determining income or loss.
Excess Aggregate Contributions shall be forfeited, if forfeitable, or
distributed on a prorata basis from the Participant's Matching
Contribution Account and if applicable, the Participant's Deferral
Contributions Account or Qualified Discretionary Contribution Account or
both. Forfeitures of Excess Aggregate Contributions shall be applied to
reduce Employer contributions; the forfeitures shall be held in the
money market fund, if any, listed in Section 1.14(b) pending such
application.
4.05 SPECIAL RULES
Deferral Contributions and Qualified Discretionary Contributions and income
allocable to each are not distributable to a Participant or his or her
beneficiary or beneficiaries, in accordance with such Participant's or
beneficiary or beneficiaries election, earlier than upon separation from
service, death, or disability, except as otherwise provided in Section 7.10,
7.11 or 10.06. Such amounts may also be distributed, but after March 31, 1988 in
the form of a lump sum only, upon:
(a) Termination of the Plan without establishment of another defined
contribution Plan, other than an Employee stock ownership Plan (as
defined in Section 4975(e) or Section 409 of the Code) or a simplified
Employee pension Plan as defined in Section 408(k) of the Code.
(b) The disposition by a corporation to an unrelated corporation of
substantially all of the assets (within the meaning of Section 409(d)(2)
of the Code) used in a trade or business of such corporation if such
corporation continues to maintain this Plan after the disposition, but
only with respect to Employees who continue employment with the
corporation acquiring such assets.
(c) The disposition by a corporation to an unrelated entity of such
corporation's interest in a subsidiary (within the meaning of Section
409(d)(2) of the Code) if such corporation continues to maintain this
Plan, but only with respect to Employees who continue employment with
such subsidiary.
The Participant's accrued benefit derived from Deferral Contributions and
Qualified Discretionary Contributions is nonforfeitable. Separate accounts for
Deferral Contributions, Qualified Discretionary Contributions, and Matching
Contributions will be maintained for each Participant. Each account will be
credited with the applicable contributions and earnings thereon.
15.
4.06 DISCRETIONARY EMPLOYER CONTRIBUTIONS
If so provided by the Employer in Sections 1.05(a)(1), for the Plan Year in
which the Plan is adopted and for each Plan Year thereafter, the Employer may
make Discretionary Employer Contributions to the Trust in accordance with
Section 1.05 to be allocated among eligible Participants, in the ratio that each
Participant's Compensation bears to the total Compensation paid to all eligible
Participants for the Plan Year.
4.07 TIME OF MAKING EMPLOYER CONTRIBUTIONS
The Employer will pay its contribution for each Plan Year not later than the
time prescribed by law for filing the Employer's Federal income tax return for
the fiscal (or taxable) year with or within which such Plan Year ends (including
extensions thereof). The Trustee will have no authority to inquire into the
correctness of the amounts contributed and paid over to the Trustee, to
determine whether any contribution is payable under this Article 4, or to
enforce, by suit or otherwise, the Employer's obligation, if any, to make a
contribution to the Trustee.
4.08 RETURN OF EMPLOYER CONTRIBUTIONS
The Trustee shall, upon request by the Employer, return to the Employer the
amount (if any) determined under Section 14.22. Such amount shall be reduced by
amounts attributable thereto which have been credited to the Accounts of
Participants who have since received distributions from the Trust, except to the
extent such amounts continue to be credited to such Participants' Accounts at
the time the amount is returned to the Employer. Such amount shall also be
reduced by the losses of the Trust attributable thereto, if and to the extent
such losses exceed the gains and income attributable thereto, but will not be
increased by the gains and income of the Trust attributable thereto, if and to
the extent such gains and income exceed the losses attributable thereto. In no
event will the return of a contribution hereunder cause the balance of the
individual Account of any Participant to be reduced to less than the balance
which would have been credited to the Account had the mistaken amount not been
contributed.
4.09 EMPLOYEE CONTRIBUTIONS
The Employer shall not allow Participants to make any Employee Contributions to
the Plan. However, the Plan may accept a frozen Participant Employee
Contribution Account. For purposes of this Plan, "Employee Contributions" shall
mean any voluntary non-deductible contribution made to the Plan by or on behalf
of a Participant that is or was included in the Participant's gross income in
the year in which made and that is maintained under a separate account to which
applicable earnings and losses are allocated. A Participant shall have a fully
vested 100% nonforfeitable right to his Employee Contributions.
4.10 ROLLOVER CONTRIBUTIONS
(a) ROLLOVER OF ELIGIBLE ROLLOVER DISTRIBUTIONS
(1) An Employee who is or was a distributee of an "eligible
rollover distribution" (as defined in Section 402(c)(4) of the
Code and the regulations issued thereunder) from a qualified Plan
or Section 403(b) annuity may directly transfer all or any
portion of such distribution to the Trust or transfer all or any
portion of such distribution to the Trust within sixty (60) days,
of payment. The transfer shall be made in the form of cash or
allowable Fund Shares only.
(2) The Employer may refuse to accept rollover contributions or
instruct the Trustee not to accept rollover contributions under
the Plan.
(b) TREATMENT OF ROLLOVER AMOUNT.
16.
(1) An Account will be established for the transferring Employee
under Article 5, the rollover amount will be credited to the
account and such amount will be subject to the terms of the Plan,
including Section 8.01, except as otherwise provided in this
Section 4.10.
(2) The rollover account will at all times be fully vested in
and nonforfeitable by the Employee.
(c) ENTRY INTO PLAN BY TRANSFERRING EMPLOYEE. Although an amount may be
transferred to the Trust Fund under this Section 4.10 by an Employee who
has not yet become a Participant in accordance with Article 4, and such
amount is subject to the terms of the Plan as described in paragraph (b)
above, the Employee will not become a Participant entitled to share in
Employer Contributions until he has satisfied such requirements.
(d) MONITORING OF ROLLOVERS.
(1) The Administrator shall develop such procedures and require
such information from transferring Employees as it deems
necessary to insure that amounts transferred under this Section
4.10 meet the requirements for tax-free rollovers established by
such Section and by Section 402(c) of the Code. No such amount
may be transferred until approved by the Administrator.
(2) If a transfer made under this Section 4.10 is later
determined by the Administrator not to have met the requirements
of this Section or of the Code or Treasury regulations, the
Trustee shall, within a reasonable time after such determination
is made, and on instructions from the Administrator, distribute
to the Employee the amounts then held in the Trust attributable
to the transferred amount.
4.11 DEDUCTIBLE VOLUNTARY EMPLOYEE CONTRIBUTIONS
The Administrator will not accept deductible Employee contributions which are
made for a taxable year beginning after December 31, 1986. Contributions made
prior to that date will be maintained in a separate account which will be
nonforfeitable at all times and which will share in the gains and losses of the
trust in the same manner as described in Section 5.02. No part of the deductible
voluntary contribution account will be used to purchase life insurance. Subject
to Article 8, the Participant may withdraw any part of the deductible voluntary
contribution account upon request.
4.12 RESERVED
ARTICLE 5 PARTICIPANTS' ACCOUNTS
5.01 INDIVIDUAL ACCOUNTS
The Administrator will establish and maintain an Account for each Participant
which will reflect Employer and Employee Contributions made on behalf of the
Participant and earnings, expenses, gains and losses attributable thereto, and
investments made with amounts in the Participant's Account. The Administrator
will establish and maintain such other Accounts and records as it decides in its
discretion to be reasonably required or appropriate in order to discharge its
duties under the Plan.
5.02 VALUATION OF ACCOUNTS
Participant Accounts will be valued at their fair market value at least annually
as of a date specified by the Administrator in accordance with a method
consistently followed and uniformly applied, and on such date earnings,
17.
expenses, gains and losses on investments made with amounts in each
Participant's Account will be allocated to such Account. Participants will be
furnished statements of their Account values at least once each Plan Year.
5.03 CODE SECTION 415 LIMITATIONS
Notwithstanding any other provisions of the Plan:
Subsections (a)(1) through (a)(4)--(THESE SUBSECTIONS APPLY TO EMPLOYERS WHO DO
NOT MAINTAIN ANY QUALIFIED PLAN INCLUDING A WELFARE BENEFIT FUND, AN INDIVIDUAL
MEDICAL ACCOUNT, OR A SIMPLIFIED EMPLOYEE PENSION IN ADDITION TO THIS PLAN.)
(a)(1) If the Participant does not participate in, and has never
participated in any other qualified Plan, Welfare Benefit Fund,
Individual Medical Account, or a simplified Employee pension, as defined
in section 408(k) of the Code, maintained by the Employer, which
provides an annual addition as defined in Section 5.03(e)(1), the amount
of Annual Additions to a Participant's Account for a Limitation Year
shall not exceed the lesser of the Maximum Permissible Amount or any
other limitation contained in this Plan. If the Employer contribution
that would otherwise be contributed or allocated to the Participant's
account would cause the annual additions for the limitation year to
exceed the maximum permissible amount, the amount contributed or
allocated will be reduced so that the annual additions for the
limitation year will equal the maximum permissible amount.
(a)(2) Prior to the determination of the Participant's actual
Compensation for a Limitation Year, the Maximum Permissible Amount may
be determined on the basis of a reasonable estimation of the
Participant's Compensation for such Limitation Year, uniformly
determined for all Participants similarly situated. Any Employer
contributions based on estimated annual Compensation shall be reduced by
any Excess Amounts carried over from prior years.
(a)(3) As soon as is administratively feasible after the end of the
Limitation Year, the Maximum Permissible Amount for such Limitation Year
shall be determined on the basis of the Participant's actual
Compensation for such Limitation Year.
(a)(4) If, pursuant to subsection (a)(3) or as a result of the
allocation of forfeitures, or a reasonable error in determining the
total Elective Deferrals there is an Excess Amount with respect to a
Participant for a Limitation Year, such Excess Amount shall be disposed
of as follows:
(A) Any Elective Deferrals, to the extent they would reduce the
Excess Amount, will be returned to the Participant.
(B) If after the application of paragraph (A) an Excess amount
still exists and the Participant is in the service of the
Employer which is covered by the Plan at the end of the
Limitation Year, then such Excess Amount shall be reapplied to
reduce future Employer contributions under this Plan for the next
Limitation Year (and for each succeeding year, as necessary) for
such Participant, so that in each such Year the sum of actual
Employer contributions plus the reapplied amount shall equal the
amount of Employer contributions which would otherwise be made to
such Participant's Account.
(C) If after the application of paragraph (A) an Excess Amount
still exists and the Participant is not in the service of the
Employer which is covered by the Plan at the end of a Limitation
Year, then such Excess Amount will be held unallocated in a
suspense account. The suspense account will be applied to reduce
future Employer contributions for all remaining Participants in
the next Limitation Year and each succeeding Limitation Year if
necessary.
(D) If a suspense account is in existence at any time during the
Limitation Year pursuant to this subsection, it will not
participate in the allocation of the Trust Fund's investment
gains and losses. All amounts in the suspense account must be
allocated to the Accounts of Participants before any
18.
Employer contribution may be made for the Limitation Year.
Except as provided in paragraph (A), Excess Amounts may not be
distributed to Participants or former Participants.
Subsections (b)(1) through (b)(6)--(THESE SUBSECTIONS APPLY TO
EMPLOYERS WHO, IN ADDITION TO THIS PLAN, MAINTAIN ONE OR MORE
PLANS, ALL OF WHICH ARE QUALIFIED MASTER OR PROTOTYPE DEFINED
CONTRIBUTION PLANS, ANY WELFARE BENEFIT FUND, ANY INDIVIDUAL
MEDICAL ACCOUNT, OR ANY SIMPLIFIED EMPLOYEE PENSION.)
(b)(1) If, in addition to this Plan, the Participant is covered under
any other qualified defined contribution Plans (all of which are
qualified Master or Prototype Plans), Welfare Benefit Funds, Individual
Medical Accounts, or simplified Employee pension Plans, maintained by
the Employer, that provide an annual addition as defined in Section
5.03(e)(1), the amount of Annual Additions to a Participant's Account
for a Limitation Year, shall not exceed the lesser of:
(A) the Maximum Permissible Amount, reduced by the sum of any
Annual Additions to the Participant's accounts for the same
Limitation Year under such other qualified Master or Prototype
defined contribution Plans, and Welfare Benefit Funds, Individual
Medical Accounts, and simplified Employee pensions, or
(B) any other limitation contained in this Plan.
If the annual additions with respect to the Participant under other
qualified Master or Prototype defined contribution Plans Welfare Benefit
Funds, Individual Medical Accounts and simplified Employee pensions
maintained by the Employer are less than the maximum permissible amount
and the Employer contribution that would otherwise be contributed or
allocated to the Participant's Account under this Plan would cause the
annual additions for the limitation year to exceed this limitation, the
amount contributed or allocated will be reduced so that the annual
additions under all such Plans and funds for the limitation year will
equal the maximum permissible amount. If the annual additions with
respect to the Participant under such other qualified Master or
Prototype defined contribution Plans, Welfare Benefit Funds, Individual
Medical Accounts and simplified Employee pensions in the aggregate are
equal to or greater than the maximum permissible amount, no amount will
be contributed or allocated to the Participant's Account under this Plan
for the limitation year.
(b)(2) Prior to the determination of the Participant's actual
Compensation for the Limitation Year, the amounts referred to in
(b)(1)(A) above may be determined on the basis of a reasonable
estimation of the Participant's Compensation for such Limitation Year,
uniformly determined for all Participants similarly situated. Any
Employer contribution based on estimated annual Compensation shall be
reduced by any Excess Amounts carried over from prior years.
(b)(3) As soon as is administratively feasible after the end of the
Limitation Year, the amounts referred to in (b)(1)(A) shall be
determined on the basis of the Participant's actual Compensation for
such Limitation Year.
(b)(4) If a Participant's Annual Additions under this Plan and all such
other Plans result in an Excess Amount, such Excess Amount shall be
deemed to consist of the Annual Additions last allocated, except that
Annual Additions attributable to a simplified Employee pension will be
deemed to have been allocated first, followed by Annual Additions to a
Welfare Benefit Fund or Individual Medical Account regardless of the
actual allocation date.
(b)(5) If an Excess Amount was allocated to a Participant on an
allocation date of this Plan which coincides with an allocation date of
another Plan, the Excess Amount attributed to this Plan will be the
product of:
(A) the total Excess Amount allocated as of such date (including
any amount which would have been allocated but for the
limitations of Section 415 of the Code), times
19.
(B) the ratio of (i) the Annual Additions allocated to the
Participant as of such date under this Plan, divided by (ii) the
Annual Additions allocated as of such date under all qualified
defined contribution Plans (determined without regard to the
limitations of Section 415 of the Code).
(b)(6) Any Excess Amounts attributed to this Plan shall be disposed of
as provided in subsection (a)(4).
Subsection (c)--(THIS SUBSECTION APPLIES ONLY TO EMPLOYERS WHO, IN
ADDITION TO THIS PLAN, MAINTAIN ONE OR MORE QUALIFIED PLANS WHICH ARE
QUALIFIED DEFINED CONTRIBUTION PLANS OTHER THAN MASTER OR PROTOTYPE
PLANS.)
(c) If the Employer also maintains another Plan which is a qualified
defined contribution Plan other than a Master or Prototype Plan, Annual
Additions allocated under this Plan on behalf of any Participant shall
be limited in accordance with the provisions of (b)(1) through (b)(6),
as though the other Plan were a Master or Prototype Plan, unless the
Employer provides other limitations in the Adoption Agreement.
Subsection (d)--(THIS SUBSECTION APPLIES ONLY TO EMPLOYERS WHO, IN
ADDITION TO THIS PLAN, MAINTAIN OR AT MY TIME MAINTAINED A QUALIFIED
DEFINED BENEFIT PLAN.)
(d) If the Employer maintains, or at any time maintained, a qualified
defined benefit Plan, the sum of any Participant's Defined Benefit
Fraction and Defined Contribution Fraction shall not exceed the combined
Plan limitation of 1.0 in any Limitation Year. The combined Plan
limitation will be met as provided by the Employer in the Adoption
Agreement.
SUBSECTIONS (E)(1) THROUGH (E)(9)--(DEFINITIONS.)
(e)(1) "Annual Additions" means the sum of the following amounts
credited to a Participant for a Limitation Year:
(A) all Employer contributions,
(B) all Employee contributions,
(C) all forfeitures,
(D) Amounts allocated, after March 31, 1984, to an Individual
Medical Account which is part of a pension or annuity Plan
maintained by the Employer are treated as Annual Additions to a
defined contribution Plan. Also, amounts derived from
contributions paid or accrued after December 31, 1985, in taxable
years ending after such date, which are attributable to
post-retirement medical benefits allocated to the separate
account of a key Employee, as defined in Section 419A(d)(3) of
the Code, under a Welfare Benefit Fund maintained by the Employer
are treated as Annual Additions to a defined contribution Plan,
and
(E) Allocations under a simplified Employee pension.
For purposes of this Section 5.03, amounts reapplied to reduce Employer
contributions under subsection (a)(4) shall also be included as Annual
Additions.
(e)(2) "Compensation" means wages as defined in Section 3401(a) of the
Code and all other payments of Compensation to an Employee by the
employer (in the course of the employer's trade or business) for which
the employer is required to furnish the Employee a written statement
under Sections 6041(d) and 6051(a)(3) of the Code. Compensation must be
determined without regard to any rules under Section 3401(a) of the Code
that limit the remuneration included in wages based on the nature or
location of the employment or the services performed (such as the
exception for agricultural labor in Section 3401(a)(2) of the Code.) For
any Self-Employed Individual Compensation will mean Earned Income.
20.
For limitation years beginning after December 31, 1991, for purposes of
applying the limitations of this article, Compensation for a limitation
year is the Compensation actually paid or made available during such
limitation year.
(e)(3) "Defined Benefit Fraction" means a fraction, the numerator of
which is the sum of the Participant's annual benefits (adjusted to an
actuarially equivalent straight life annuity if such benefit is
expressed in a form other than a straight life annuity or qualified
joint and survivor annuity) under all the defined benefit Plans (whether
or not terminated) maintained by the Employer, each such annual benefit
computed on the assumptions that the Participant will remain in
employment until the normal retirement age under each such Plan (or the
Participant's current age, if later) and that all other factors used to
determine benefits under such Plan will remain constant for all future
Limitation Years, and the denominator of which is the lesser of 125
percent of the dollar limitation determined for the Limitation Year
under Sections 415(b)(1)(A) and 415(d) of the Code or 140 percent of the
Participant's average Compensation for the 3 highest consecutive
calendar years of service during which the Participant was active in
each such Plan, including any adjustments under Section 415(b) of the
Code. However, if the Participant was a Participant as of the first day
of the first Limitation Year beginning after December 31, 1986 in one or
more defined benefit Plans maintained by the Employer which were in
existence on May 6, 1986 then the denominator of the Defined Benefit
Fraction shall not be less than 125 percent of the Participant's total
accrued benefit as of the close of the last Limitation Year beginning
before January 1, 1987, disregarding any changes in the terms and
conditions of the Plan after May 5, 1986, under all such defined benefit
Plans as met, individually and in the aggregate, the requirements of
Section 415 of the Code for all Limitation Years beginning before
January 1, 1987.
(e)(4) "Defined Contribution Fraction" means a fraction, the numerator
of which is the sum for the current and all prior Limitation Years of
(A) all Annual Additions (if any) to the Participant's accounts under
each defined contribution Plan (whether or not terminated) maintained by
the Employer, and (B) all Annual Additions attributable to the
Participant's nondeductible Employee contributions to all defined
benefit Plans (whether or not terminated) maintained by the Employer,
and the Participant's Annual Additions attributable to all Welfare
Benefit Funds, Individual Medical Accounts, and simplified Employee
pensions, maintained by the Employer, and the denominator of which is
the sum of the maximum aggregate amounts for the current and all prior
Limitation Years during which the Participant was an Employee
(regardless of whether the Employer maintained a defined contribution
Plan in any such year).
The maximum aggregate amount in any Limitation Year is the lesser of 125
percent of the dollar limitation in effect under Section 415(c)(1)(A) of
the Code for each such year or 35 percent of the Participant's
Compensation for each such year.
If the Participant was a Participant as of the first day of the first
Limitation Year beginning after December 31, 1986 in one or more defined
contribution Plans maintained by the Employer which were in existence on
May 6, 1986 then the numerator of the Defined Contribution Fraction
shall be adjusted if the sum of this fraction and the Defined Benefit
Fraction would otherwise exceed 1.0 under the terms of this Plan. Under
the adjustment an amount equal to the product of (i) the excess of the
sum of the fractions over 1.0 times (ii) the denominator of this
fraction will be permanently subtracted from the numerator of this
fraction. The adjustment is calculated using the fractions as they would
be computed as of the end of the last Limitation Year beginning before
January 1, 1987, and disregarding any changes in the terms and
conditions of the Plan made after May 6, 1986, but using the Section 415
limitation applicable to the first Limitation Year beginning on or after
January 1, 1987. The annual addition for any limitation year beginning
before January 1, 1987 shall not be recomputed to treat all Employee
contributions as annual additions.
(e)(5) "Employer" means the Employer and any Related Employer that
adopts this Plan. In the case of a group of employers which constitutes
a controlled group of corporations (as defined in Section 414(b) of the
Code as modified by Section 415(h)) or which constitutes trades or
businesses (whether or not incorporated) which are under common control
(as defined in Section 414(c) of the Code as modified by Section 415(h)
of the Code) or which constitutes an affiliated service group (as
defined in Section 414(m) of the Code) and any other entity required to
be aggregated with the Employer pursuant to regulations issued under
Section 414(o) of the Code, all such employers shall be considered a
single employer for purposes of applying the limitations of this Section
5.03.
21.
(e)(6) "Excess Amount" means the excess of the Participant's Annual
Additions for the Limitation Year over the Maximum Permissible Amount.
(e)(7) "Individual Medical Account" means an individual medical account
as defined in Section 415(l)(2) of the Code.
(e)(8) "Limitation Year" means the Plan Year. All qualified Plans of the
Employer must use the same Limitation Year. If the Limitation Year is
amended to a different 12-consecutive month period, the new Limitation
Year must begin on a date within the Limitation Year in which the
amendment is made.
(e)(9) "Master or Prototype Plan" means a Plan the form of which is the
subject of a favorable opinion letter from the Internal Revenue Service.
(e)(10) "Maximum Permissible Amount" means for a Limitation Year with
respect to any Participant the lesser of (i) $30,000 or, if greater, 25
percent of the dollar limitation set forth in Section 415(b)(1) of the
Code, as in effect for the Limitation Year, or (ii) 25 percent of the
Participant's Compensation for the Limitation Year. If a short
Limitation Year is created because of an amendment changing the
Limitation Year to a different 12-consecutive month period, the Maximum
Permissible Amount will not exceed the limitation in (e)(10)(i)
multiplied by a fraction whose numerator is the number of months in the
short Limitation Year and whose denominator is 12.
The Compensation limitation referred to in subsection (e)(10)(ii) shall
not apply to any contribution for medical benefits within the meaning of
Section 401(h) or Section 419A(f)(2) of the Code after separation from
service which is otherwise treated as an Annual Addition under Section
419A(d)(2) or Section 415(l)(1) of the Code.
(e)(11) "Welfare Benefit Fund" means a welfare benefit fund as defined
in Section 419(e) of the Code.
ARTICLE 6 INVESTMENT OF CONTRIBUTIONS
6.01 MANNER OF INVESTMENT
All contributions made to the Accounts of Participants shall be held for
investment by the Trustee. The Accounts of Participants shall be invested and
reinvested only in eligible investments selected by the Employer in Section
1.14(b), subject to Section 14.10.
6.02 INVESTMENT DECISIONS
Investments shall be directed by each Participant in accordance with this
Section and Section 1.14(a). Pursuant to Section 14.04, the Trustee shall have
no discretion or authority with respect to the investment of the Trust Fund.
(a) Reserved
(b) Each Participant shall direct the investment of his Account among
the Fidelity Funds listed in Section 1.14(b). The Participant shall file
initial investment instructions with the Administrator, on such form as
the Administrator may provide, selecting the Funds in which amounts
credited to his Account will be invested.
(1) Except as provided in this Section 6.02, only authorized Plan
contacts and the Participant shall have access to a Participant's
Account. While any balance remains in the Account of a
Participant after his death, the Beneficiary of the Participant
shall make decisions as to the investment of the Account as
though the Beneficiary were the Participant. To the extent
required by a qualified
22.
domestic relations order as defined in Section 414(p) of the
Code, an alternate payee shall make investment decisions with
respect to a Participant's Account as though such alternate
payee were the Participant.
(2) If the Trustee receives any contribution under the Plan as to
which investment instructions have not been provided, the Trustee
shall promptly notify the Administrator and the Administrator
shall take steps to elicit instructions from the Participant. The
Trustee shall credit any such contribution to the Participant's
Account and such amount shall be invested in the Fidelity Fund
selected by the Employer for such purposes or, absent Employer
selection, in the most conservative Fidelity Fund listed in
Section 1.14(b), until investment instructions have been received
by the Trustee.
(c) All dividends, interest, gains and distributions of any nature
received in respect of Fund Shares shall be reinvested in additional
shares of that Fidelity Fund.
(d) Expenses attributable to the acquisition of investments shall be
charged to the Account of the Participant for which such investment is
made.
6.03 PARTICIPANT DIRECTIONS TO TRUSTEE
All Participant initial investment instructions filed with the Administrator
pursuant to the provisions of Section 6.02 shall be promptly transmitted by the
Administrator to the Trustee. A Participant shall transmit subsequent investment
instructions directly to the Trustee by means of the telephone exchange system
maintained by the Trustee for such purposes. The method and frequency for change
of investments will be determined under the (a) rules applicable to the
investments selected by the Employer in Section 1.14(b) and (b) the additional
rules of the Employer, if any, limiting the frequency of investment changes,
which, are included in a separate written administrative procedure adopted by
the Employer and accepted by the Trustee. The Trustee shall have no duty to
inquire into the investment decisions of a Participant or to advise him
regarding the purchase, retention or sale of assets credited to his Account.
ARTICLE 7 RIGHT TO BENEFITS
7.01 NORMAL OR EARLY RETIREMENT
Each Participant who attains his Normal Retirement Age or, if so provided by the
Employer in Section 1.06(b), Early Retirement Age will have a 100 percent
nonforfeitable interest in his Account regardless of any vesting schedule
elected in Section 1.07. If a Participant retires upon the attainment of Normal
or Early Retirement Age, such retirement is referred to as a normal retirement.
Upon his normal retirement the balance of the Participant's Account, plus any
amounts thereafter credited to his Account, subject to the provisions of Section
7.08, will be distributed to him in accordance with Article 8.
If a Participant separates from service before satisfying the age requirements
for early retirement, but has satisfied the service requirement, the Participant
will be entitled to elect an early retirement distribution upon satisfaction of
such age requirement.
7.02 LATE RETIREMENT
If a Participant continues in the service of the Employer after attainment of
Normal Retirement Age, he will continue to have a 100 percent nonforfeitable
interest in his Account and will continue to participate in the Plan until the
date he establishes with the Employer for his late retirement. Until he retires,
he has a continuing election to receive all or any portion of his Account. Upon
the earlier of his late retirement or the distribution date required
23.
under Section 8.08, the balance of his Account, plus any amounts thereafter
credited to his Account, subject to the provisions of Section 7.08, will be
distributed to him in accordance with Article 8 below.
7.03 DISABILITY RETIREMENT
If so provided by the Employer in Section 1.06(c), a Participant who becomes
disabled will have a 100 percent nonforfeitable interest in his Account, the
balance of which Account, plus any amounts thereafter credited to his Account,
subject to the provisions of Section 7.08, will be distributed to him in
accordance with Article 8 below. A Participant is considered disabled if he
cannot engage in any substantial, gainful activity because of a medically
determinable physical or mental impairment likely to result in death or to be of
a continuous period of not less than 12 months, and terminates his employment
with the employer. Such termination of employment is referred to as a disability
retirement. Determinations with respect to disability shall be made by the
Administrator who may rely on the criteria set forth in Section 1.06(c) as
evidence that the Participant is disabled.
7.04 DEATH
Subject, if applicable, to Section 8.04, if a Participant dies before the
distribution of his Account has commenced, or before such distribution has been
completed, his Account shall become 100 percent vested and his designated
Beneficiary or Beneficiaries will be entitled to receive the balance or
remaining balance of his Account, plus any amounts thereafter credited to his
Account, subject to the provisions of Section 7.08. Distribution to the
Beneficiary or Beneficiaries will be made in accordance with Article 8.
A Participant may designate a Beneficiary or Beneficiaries, or change any prior
designation of Beneficiary or Beneficiaries by giving notice to the
Administrator on a form designated by the Administrator. If more than one person
is designated as the Beneficiary, their respective interests shall be as
indicated on the designation form. In the case of a married Participant the
Participant's spouse shall be deemed to be the designated Beneficiary unless the
Participant's spouse has consented to another designation in the manner
described in Section 8.03(d).
A copy of the death notice or other sufficient documentation must be filed with
and approved by the Administrator. If upon the death of the Participant there
is, in the opinion of the Administrator, no designated Beneficiary for part or
all of the Participant's Account, such amount will be paid to his surviving
spouse or, if none, to his estate (such spouse or estate shall be deemed to be
the Beneficiary for purposes of the Plan). If a Beneficiary dies after benefits
to such Beneficiary have commenced, but before they have been completed, and, in
the opinion of the Administrator, no person has been designated to receive such
remaining benefits, then such benefits shall be paid in a lump sum to the
deceased Beneficiary's estate.
7.05 OTHER TERMINATION OF EMPLOYMENT
If a Participant terminates his employment for any reason other than death or
normal, late, or disability retirement, he will be entitled to a termination
benefit equal to (a) the vested percentage(s) of the value of the Matching
and/or Discretionary Contributions to his Account, as adjusted for income,
expense, gain, or loss, such percentage(s) determined in accordance with the
vesting schedule(s) selected by the Employer in Section 1.07, and (b) the value
of the Deferral, Qualified Discretionary and Rollover Contributions to his
Account as adjusted for income, expense, gain or loss. The amount payable under
this Section 7.05 will be subject to the provisions of Section 7.08 and will be
distributed in accordance with Article 8 below.
7.06 SEPARATE ACCOUNT
If a distribution from a Participant's Account has been made to him at a time
when he has a nonforfeitable right to less than 100 percent of his Account, the
vesting schedule in Section 1.07 will thereafter apply only to amounts in his
Account attributable to Employer Contributions allocated after such
distribution. The balance of his Account
24.
immediately after such distribution will be transferred to a separate account
which will be maintained for the purpose of determining his interest therein
according to the following provisions.
At any relevant time prior to a forfeiture of any portion thereof under Section
7.07 a Participant's nonforfeitable interest in his Account held in a separate
account described in the preceding paragraph will be equal to P(AB +
(RxD))-(RxD), where P is the nonforfeitable percentage at the relevant time
determined under Section 7.05; AB is the account balance of the separate account
at the relevant time; D is the amount of the distribution; and R is the ratio of
the account balance at the relevant time to the account balance after
distribution. Following a forfeiture of any portion of such separate account
under Section 7.07 below, any balance in the Participant's separate account will
remain fully vested and nonforfeitable.
7.07 FORFEITURES
If a Participant terminates his employment, any portion of his Account
(including any amounts credited after his termination of employment) not payable
to him under Section 7.05 will be forfeited by him upon the complete
distribution to him of the vested portion of his Account, if any, subject to the
possibility of reinstatement as described in the following paragraph. For
purposes of this paragraph, if the value of an Employee's vested account balance
is zero, the Employee shall be deemed to have received a distribution of his
vested interest immediately following termination of employment. Such
forfeitures will be applied to reduce the contributions of the Employer next
payable under the Plan (or administrative expenses of the Plan); the forfeitures
shall be held in a money market fund pending such application.
If a Participant forfeits any portion of his Account under the preceding
paragraph but does again become an Employee after such date, then the amount so
forfeited, without any adjustment for the earnings, expenses, or losses or gains
of the assets credited to his Account since the date forfeited, will be
re-credited to his Account (or to a separate account as described in Section
7.06, if applicable) but only if he repays to the Plan before the earlier of
five years after the date of his re-employment or the date he incurs 5
consecutive 1-year breaks in service following the date of the distribution the
amount previously distributed to him, without interest, under Section 7.05. If
an Employee is deemed to receive a distribution pursuant to this Section 7.07,
and the Employee resumes employment before 5 consecutive 1-year breaks in
service, the Employee shall be deemed to have repaid such distribution on the
date of his re-employment. Upon such an actual or deemed repayment, the
provisions of the Plan (including Section 7.06) will thereafter apply as if no
forfeiture had occurred. The amount to be re-credited pursuant to this paragraph
will be derived first from the forfeitures, if any, which as of the date of
re-crediting have yet to be applied as provided in the preceding paragraph and,
to the extent such forfeitures are insufficient, from a special Employer
contribution to be made by the Employer.
If a Participant elects not to receive the nonforfeitable portion of his Account
following his termination of employment, the non-vested portion of his Account
shall be forfeited after the Participant has incurred five consecutive 1-year
breaks in service as defined in Section 2.01(a)(33).
No forfeitures will occur solely as a result of a Participant's withdrawal of
Employee contributions.
7.08 ADJUSTMENT FOR INVESTMENT EXPERIENCE
If any distribution under this Article 7 is not made in a single payment, the
amount retained by the Trustee after the distribution will be subject to
adjustment until distributed to reflect the income and gain or loss on the
investments in which such amount is invested and any expenses properly charged
under the Plan and Trust to such amounts.
7.09 PARTICIPANT LOANS
If permitted under Section 1.09, the Administrator shall allow Participants to
apply for a loan from the Plan, subject to the following:
25.
(a) LOAN APPLICATION. All Plan loans shall be administered by the
Administrator. Applications for loans shall be made to the Administrator
on forms available from the Administrator. Loans shall be made available
to all Participants on a reasonably equivalent basis. For this purpose,
the term "Participant" means any Participant or Beneficiary, including
an alternate payee under a qualified domestic relations order, as
defined in Section 414(p) of the Code, who is a party-in-interest (as
determined under ERISA Section 3(14)) with respect to the Plan except no
loans will be made to: (i) an Employee who makes a rollover contribution
in accordance with Section 4.10 who has not satisfied the requirements
of Section 3.01, or (ii) a shareholder-Employee or Owner-Employee. For
purposes of this requirement, a shareholder-Employee means an Employee
or officer of an electing small business (Subchapter S) corporation who
owns (or is considered as owning within the meaning of Section 318(a)(1)
of the Code), on any day during the taxable year of such corporation,
more than 5% of the outstanding stock of the corporation.
A Participant with an existing loan may not apply for another loan until
the existing loan is paid in full and may not refinance an existing loan
or attain a second loan for the purpose of paying off the existing loan.
A Participant may not apply for more than one loan during each Plan
Year.
(b) LIMITATION OF LOAN AMOUNT/PURPOSE OF LOAN. Loans shall not be made
available to Highly Compensated Employees in an amount greater than the
amount made available to other Employees. No loan to any Participant or
Beneficiary can be made to the extent that such loan when added to the
outstanding balance of all other loans to the Participant or Beneficiary
would exceed the lesser of (a) $50,000 reduced by the excess (if any) of
the highest outstanding balance of loans during the one year period
ending on the day before the loan is made over the outstanding balance
of loans from the Plan on the date the loan is made, or (b) one-half the
present value of the nonforfeitable Account of the Participant. For the
purpose of the above limitation, all loans from all Plans of the
Employer and Related Employers are aggregated. A Participant may not
request a loan for less than $1,000. The Employer may provide that loans
only be made from certain contribution sources within Participant
Account(s) by notifying the Trustee in writing of the restricted source.
Loans may be made for any purpose or if elected by the Employer in
Section 1.09(a), on account of hardship only. A loan will be considered
to be made on account of hardship only if made on account of an
immediate and heavy financial need described in Section 7.10(b)(1).
(c) TERMS OF LOAN. All loans shall bear a reasonable rate of interest as
determined by the Administrator based on the prevailing interest rates
charged by persons in the business of lending money for loans which
would be made under similar circumstances. The determination of a
reasonable rate of interest must be based on appropriate regional
factors unless the Plan is administered on a national basis in which
case the Administrator may establish a uniform reasonable rate of
interest applicable to all regions.
All loans shall by their terms require that repayment (principal and
interest) be amortized in level payments, not less than quarterly, over
a period not extending beyond five years from the date of the loan
unless such loan is for the purchase of a Participant's primary
residence, in which case the repayment period may not extend beyond ten
years from the date of the loan. A Participant may prepay the
outstanding loan balance prior to maturity without penalty.
(d) SECURITY. Loans must be secured by the Participant's Accounts not to
exceed 50 percent of the Participant's vested Account. A Participant
must obtain the consent of his or her spouse, if any, to use a
Participant Account as security for the loan, if the provisions of
Section 8.03 apply to the Participant. Spousal consent shall be obtained
no earlier than the beginning of the 90-day period that ends on the date
on which the loan is to be so secured. The consent must be in writing,
must acknowledge the effect of the loan, and must be witnessed by a Plan
representative or notary public. Such consent shall thereafter be
binding with respect to the consenting spouse or any subsequent spouse
with respect to that loan.
(e) DEFAULT. The Administrator shall treat a loan in default if:
(1) any scheduled repayment remains unpaid more than 90 days;
26.
(2) there is an outstanding principal balance existing on a loan
after the last scheduled repayment date.
Upon default or termination of employment, the entire outstanding
principal and accrued interest shall be immediately due and payable. If
a distributable event (as defined by the Code) has occurred, the
Administrator shall direct the Trustee to foreclose on the promissory
note and offset the Participant's vested Account by the outstanding
balance of the loan. If a distributable event has not occurred, the
Administrator shall direct the Trustee to foreclose on the promissory
note and offset the Participant's vested Account as soon as a
distributable event occurs.
(f) PRE-EXISTING LOANS. The provision in paragraph (a) of this Section
7.09 limiting a Participant to one outstanding loan shall not apply to
loans made before the Employer adopted this prototype Plan document. A
Participant may not apply for a new loan until all outstanding loans
made before the Employer adopted this prototype Plan have been paid in
full. The Trustee may accept any loans made before the Employer adopted
this prototype Plan document except such loans which require the Trustee
to hold as security for the loan property other than the Participant's
vested Account.
As of the effective date of amendment of this Plan in Section
1.01(g)(2), the Trustee shall have the right to re-amortize the
outstanding principal balance of any Participant loan that is
delinquent. Such re-amortization shall be based upon the remaining life
of the loan and the original maturity date may not be extended.
Notwithstanding any other provision of this Plan, the portion of the
Participant's vested Account used as a security interest held by the
Plan by reason of a loan outstanding to the Participant shall be taken
into account for purposes of determining the amount of the Account
payable at the time of death or distribution, but only if the reduction
is used as repayment of the loan. If less than 100% of the Participant's
vested Account (determined without regard to the preceding sentence) is
payable to the surviving spouse, then the Account shall be adjusted by
first reducing the vested Account by the amount of the security used as
repayment of the loan, and then determining the benefit payable to the
surviving spouse.
No loan to any Participant or Beneficiary can be made to the extent that
such loan when added to the outstanding balance of all other loans to
the Participant or Beneficiary would exceed the lesser of (a) $50,000
reduced by the excess (if any) of the highest outstanding balance of
loans during the one year period ending on the day before the loan is
made over the outstanding balance of loans from the Plan on the date the
loan is made, or (b) one-half the present value of the nonforfeitable
Account of the Participant. For the purpose of the above limitation, all
loans from all Plans of the Employer and Related Employers are
aggregated.
7.10 IN-SERVICE/HARDSHIP WITHDRAWALS
Subject to the provisions of Article 8, a Participant shall not be permitted to
withdraw any Employer or Employee Contributions (and earnings thereon) prior to
retirement or termination of employment, except as follows:
(a) AGE 59-1/2. If permitted under Section 1.11(b), a Participant who
has attained the age of 59-1/2 is permitted to withdraw upon request all
or any portion the Accounts specified by the Employer in 1.11(b).
(b) HARDSHIP. If permitted under Section 1.10, a Participant may apply
to the Administrator to withdraw some or all of his Deferral
Contributions (and earnings thereon accrued as of December 31, 1988)
and, if applicable, Rollover Contributions and such other amounts
allowed by a predecessor Plan, if such withdrawal is made on account of
a hardship. For purposes of this Section, a distribution is made on
account of hardship if made on account of an immediate and heavy
financial need of the Employee where such Employee lacks other available
resources. Determinations with respect to hardship shall be made by the
Administrator and shall be conclusive for purposes of the Plan, and
shall be based on the following special rules:
(1) The following are the only financial needs considered
immediate and heavy: expenses incurred or necessary for medical
care (within the meaning of Section 213(d) of the Code) of the
Employee, the
27.
Employee's spouse, children, or dependents; the purchase
(excluding mortgage payments) of a principal residence for the
Employee; payment of tuition and related educational fees for
the next twelve (12) months of post-secondary education for the
Employee, the Employee's spouse, children or dependents; or the
need to prevent the eviction of the Employee from, or a
foreclosure on the mortgage of, the Employee's principal
residence.
(2) A distribution will be considered as necessary to satisfy an
immediate and heavy financial need of the Employee only if:
(i) The Employee has obtained all distributions, other than
the hardship distributions, and all nontaxable (at the time
of the loan) loans currently available under all Plans
maintained by the Employer;
(ii) The Employee suspends Deferral Contributions and
Employee Contributions to the Plan for the 12-month period
following the date of his hardship distribution. The
suspension must also apply to all elective contributions
and Employee contributions to all other qualified Plans and
non-qualified Plans maintained by the Employer, other than
any mandatory employer contribution portion of a defined
benefit Plan, including stock option, stock purchase and
other similar Plans, but not including health and welfare
benefit Plans (other than the cash or deferred arrangement
portion of a cafeteria Plan);
(iii) The distribution is not in excess of the amount of an
immediate and heavy financial need (including amounts
necessary to pay any Federal, state or local income taxes
or penalties reasonably anticipated to result from the
distribution); and
(iv) The Employee agrees to limit Deferral Contributions
(elective contributions) to the Plan and any other
qualified Plan maintained by the Employer for the
Employee's taxable year immediately following the taxable
year of the hardship distribution to the applicable limit
under Section 402(g) of the Code for such taxable year less
the amount of such Employee's Deferral Contributions for
the taxable year of the hardship distribution.
(3) A Participant must obtain the consent of his or her spouse,
if any, to obtain a hardship withdrawal, if the provisions of
Section 8.03 apply to the Participant.
(c) EMPLOYEE CONTRIBUTIONS. A Participant may elect to withdraw, in
cash, up to one hundred percent of the amount then credited to his
Employee Contribution Account. Such withdrawals shall be limited to one
(1) per Plan Year unless this prototype Plan document is an amendment of
a prior Plan document, in which case the rules and restrictions
governing Employee contribution withdrawals, if any, are incorporated
herein by reference.
7.11 PRIOR PLAN IN-SERVICE DISTRIBUTION RULES
If designated by the Employer in Section 1.11(b), or Section 1.11(c)(2) or (3)a
Participant shall be entitled to withdraw at anytime prior to his termination of
employment, subject to the provisions of Article 8 and the prior Plan, any
vested Employer Contributions maintained in a Participant's Account for the
specified period of time.
ARTICLE 8 DISTRIBUTION OF BENEFITS PAYABLE AFTER TERMINATION OF SERVICE.
8.01 DISTRIBUTION OF BENEFITS TO PARTICIPANTS AND BENEFICIARIES
(a) Distributions from the Trust to a Participant or to the Beneficiary
of the Participant shall be made in a lump sum in cash or, if elected by
the Employer in Section 1.11, under a systematic withdrawal Plan
28.
(installment(s)) upon retirement, death, disability, or other
termination of employment, unless another form of distribution is
required or permitted in accordance with paragraph (d) of this Section
8.01 or Sections 1.11(c), 8.02, 8.03, 8.04 or 11.02. A distribution may
be made in Fund Shares, at the election of the Participant, pursuant to
the qualifying rollover of such distribution to a Fidelity Investments
individual retirement account.
(b) Distributions under a systematic withdrawal Plan must be made in
substantially equal annual, or more frequent, installments, in cash,
over a period certain which does not extend beyond the life expectancy
of the Participant or the joint life expectancies of the Participant and
his Beneficiary, or, if the Participant dies prior to the commencement
of his benefits the life expectancy of the Participant's Beneficiary, as
further described in Section 8.04.
(c) Notwithstanding the provisions of Section 8.01(b) above, if a
Participant's Account is, and at the time of any prior distribution(s)
was, $3,500 or less, the balance of such Account shall be distributed in
a lump sum as soon as practicable following retirement, disability,
death or other termination of employment.
(d) This paragraph (d) 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 8, a
distributee may elect, at the time and in the manner prescribed by the
Administrator, to have any portion of an eligible rollover distribution
paid directly to an eligible retirement Plan specified by the
distributee in a direct rollover. The following definitions shall apply
for purposes of this paragraph (d):
(1) Eligible rollover distribution. An eligible rollover
distribution is any distribution of all or any portion of the
balance to the credit of the distributee, except that an eligible
rollover distribution does not include: any distribution that is
one of a series of substantially equal periodic payments (not
less frequently than annually) made for the life (or life
expectancy) of the distributee or the joint lives (or joint life
expectancies) of the distributee and the distributee's designated
beneficiary, or for a specified period of ten years or more; any
distribution to the extent such distribution is required under
Section 401(a)(9) of the Code; and the portion of any
distribution that is not includable in gross income (determined
without regard to the exclusion for net unrealized appreciation
with respect to employer securities).
(2) Eligible retirement plan. An eligible retirement plan is an
individual retirement account described in Section 408(a) of the
Code, an individual retirement annuity described in Section
408(b) of the Code, an annuity Plan described in Section 403(a)
of the Code, or a qualified trust described in Section 401(a) of
the Code, that accepts the distributee's eligible rollover
distribution. However, in the case of an eligible rollover
distribution to a surviving spouse, an eligible retirement Plan
is an individual retirement account or individual retirement
annuity.
(3) Distributee. A distributee includes an Employee or former
Employee. In addition, the Employee's or former Employee's
surviving spouse and the Employee's or former Employee's spouse
or former spouse who is the alternate payee under a qualified
domestic relations order, as defined in Section 414(p) of the
Code, are distributees with regard to the interest of the spouse
or former spouse.
(4) Direct rollover. A direct rollover is a payment by the Plan
to the eligible retirement plan specified by the distributee.
(5) If a distribution is one to which Sections 401(a)(11) and 417
of the Code do not apply, such distribution may commence less
than 30 days after the notice required under Section 1.411(a) -
11(c) of the Income Tax Regulations is given, provided that:
(A) the Plan Administrator clearly informs the Distributee
that the Distributee has a right to a period of at least
30 days after receiving the notice to consider the
decision of whether or not to elect a distribution (and,
if applicable, a particular distribution option), and
29.
(B) the Distributee after receiving the notice
affirmatively elects a distribution.
8.02 ANNUITY DISTRIBUTIONS
If so provided in Section 1.11(c), a Participant may elect distributions made in
whole or in part in the form of an annuity contract subject to the provisions of
Section 8.03.
(a) An annuity contract distributed under the Plan must be purchased
from an insurance company and must be nontransferable. The terms of an
annuity contract shall comply with the requirements of the Plan and
distributions under such contract shall be made in accordance with
Section 401(a)(9) of the Code and the regulations thereunder.
(b) The payment period of an annuity contract distributed to the
Participant pursuant to this Section may be as long as the Participant
lives. If the annuity is payable to the Participant and his spouse or
designated Beneficiary, the payment period of an annuity contract may be
for as long as either the Participant or his spouse or designated
Beneficiary lives. Such an annuity may provide for an annuity certain
feature for a period not exceeding the life expectancy of the
Participant. If the annuity is payable to the Participant and his spouse
such period may not exceed the joint life and last survivor expectancy
of the Participant and his spouse, or, if the annuity is payable to the
Participant and a designated Beneficiary, the joint life and last
survivor expectancy of the Participant and such Beneficiary. If the
Participant dies prior to the commencement of his benefits, the payment
period of an annuity contract distributed to the Beneficiary of the
Participant may be as long as the Participant's Beneficiary lives, and
may provide for an annuity certain feature for a period not exceeding
the life expectancy of the Beneficiary. Any annuity contract distributed
under the Plan must provide for non increasing payments.
8.03 JOINT AND SURVIVOR ANNUITIES/PRE-RETIREMENT SURVIVOR ANNUITIES
(a) APPLICATION. The provisions of this Section supersede any
conflicting provisions of the Plan; provided, however, that paragraph
(b) of this Section shall not apply if the Participant's Account does
not exceed or at the time of any prior distribution did not exceed
$3,500. A Participant is described in this Section only if (i) the
Participant has elected distribution of his Account in the form of an
Annuity Contract in accordance with Section 8.02, or (ii) the Trustee
has directly or indirectly received a transfer of assets from another
Plan (including a predecessor Plan) to which Section 401(a)(11) of the
Code applies with respect to such Participant.
(b) RETIREMENT ANNUITY. Unless the Participant elects to waive the
application of this subsection in a manner satisfying the requirements
of subsection (d) below, to the extent applicable to the Participant,
within the 90-day period preceding his Annuity Starting Date (which
election may be revoked, and if revoked, remade, at any time in such
period), the vested Account due any Participant to whom this subsection
(b) applies will be paid to him by the purchase and delivery to him of
an annuity contract described in Section 8.02 providing a life annuity
only form of benefit or, if the Participant is married as of his Annuity
Starting Date, providing an immediate annuity for the life of the
Participant with a survivor annuity for the life of the Participant's
spouse (determined as of the date of distribution of the contract) which
is 50 percent of the amount of the annuity which is payable during the
joint lives of the Participant and such spouse. The Participant may
elect to receive distribution of his benefits in the form of such
annuity as of the earliest date on which he could elect to receive
retirement benefits under the Plan. Within the period beginning 90 days
prior to the Participant's Annuity Starting Date and ending 30 days
prior to such Date, the Administrator will provide such Participant with
a written explanation of (i) the terms and conditions of the annuity
contract described herein, (ii) the Participant's right to make and the
effect of an election to waive application of this subsection, (iii) the
rights of the Participant's spouse under subsection (d), and (iv) the
right to revoke and the period of time effect of a revocation of the
election to waive application of this subsection.
30.
(c) ANNUITY DEATH BENEFIT. Unless the Participant elects to waive the
application of this subsection in a manner satisfying the requirements
of subsection (d) below at any time within the applicable election
period (which election may be revoked, and if revoked, remade, at any
time in such period), if a married Participant to whom this Section
applies dies before his Annuity Starting Date, then notwithstanding any
designation of a Beneficiary to the contrary, 50 percent of his vested
Account will be applied to purchase an annuity contract described in
Section 8.02 providing an annuity for the life of the Participant's
surviving spouse, which contract will then be promptly distributed to
such spouse. In lieu of the purchase of such an annuity contract, the
spouse may elect in writing to receive distributions under the Plan as
if he or she had been designated by the Participant as his Beneficiary
with respect to 50 percent of his Account. For purposes of this
subsection, the applicable election period will commence on the first
day of the Plan Year in which the Participant attains age 35 and will
end on the date of the Participant's death, provided that in the case of
a Participant who terminates his employment the applicable election
period with respect to benefits accrued prior to the date of such
termination will in no event commence later than the date of his
termination of employment. A Participant may elect to waive the
application of this subsection prior to the Plan Year in which he
attains age 35, provided that any such waiver will cease to be effective
as of the first day of the Plan Year in which the Participant attains
age 35.
The Administrator will provide a Participant to whom this subsection
applies with a written explanation with respect to the annuity death
benefit described in this subsection (c) comparable to that required
under subsection (b) above. Such explanation shall be furnished within
whichever of the following periods ends last: (i) the period beginning
with the first day of the Plan Year in which the Participant reaches age
32 and ending with the end of the Plan Year preceding the Plan Year in
which he reaches age 35, (ii) a reasonable perod ending after the
Employee becomes a Participant, (iii) a reasonable period ending after
this Section 8.04 first becomes applicable to the Participant in
accordance with Section 8.04(a), (iv) in the case of a Participant who
separates from service before age 35, a reasonable period of time ending
after separation from service. For purposes of the preceding sentence,
the two-year period beginning one year prior to the date of the event
described in clause (ii), (iii) or (iv), whichever is applicable, and
ending one year after such date shall be considered reasonable,
provided, that in the case of a Participant who separates from service
under (iv) above and subsequently recommences employment with the
Employer, the applicable period for such Participant shall be
predetermined in accordance with this subsection.
(d) REQUIREMENTS OF ELECTIONS. This subsection will be satisfied with
respect to a waiver or designation which is required to satisfy this
subsection if such waiver or designation is in writing and either
(1) the Participant's spouse consents thereto in writing, which
consent must acknowledge the effect of such waiver or designation
and be witnessed by a notary public or Plan representative, or
(2) the Participant establishes to the satisfaction of the
Administrator that the consent of the Participant's spouse cannot
be obtained because there is no spouse, because the spouse cannot
be located or because of such other circumstances as the
Secretary of Treasury may prescribe.
Any consent by a spouse, or establishment that the consent of a
spouse may not be obtained, will be effective only with respect
to a specific Beneficiary (including any class of beneficiaries
or any contingent beneficiaries) or form of benefits identified
in the Participant's waiver or designation, unless the consent of
the spouse expressly permits designations by the Participant
without any requirement of further consent by the spouse. A
consent which permits such designations by the Participant shall
acknowledge that the spouse has the right to limit consent to a
specific Beneficiary and form of benefits and that the spouse
voluntarily elects to relinquish both such rights. A consent by a
spouse shall be irrevocable once made. Any such consent, or
establishment that such consent may not be obtained, will be
effective only with respect to such spouse. For purposes of
subsections (b) and (c) above, no consent of a spouse shall be
valid unless the notice required by such subsection, whichever is
applicable, has been provided to the Participant.
(e) FORMER SPOUSE. For purposes of this Section 8.03, a former spouse of
a Participant will be treated as the spouse or surviving spouse of the
Participant, and a current spouse will not be so treated, to the extent
required under a qualified domestic relations order, as defined in
Section 414(p) of the Code.
31.
(f) VESTED ACCOUNT BALANCE. For purposes of this Section, vested Account
shall include the aggregate value of the Participant's vested Account
derived from Employer and Employee contributions (including rollovers),
whether vested before or upon death. The provisions of this Section
shall apply to a Participant who is vested in amounts attributable to
Employer contributions, Employee contributions, or both, upon death or
at the time of distribution.
8.04 INSTALLMENT DISTRIBUTIONS
This Section shall be interpreted and applied in accordance with the regulations
under Section 401(a)(9) of the Code, including the minimum distribution
incidental benefit requirement of section 1.401(a)(9)-2 of the regulations.
(a) IN GENERAL. If a Participant's benefit may be distributed in
accordance with Section 8.01(b), the amount to be distributed for each
calendar year for which a minimum distribution is required shall be at
least an amount equal to the quotient obtained by dividing the
Participant's interest in his Account by the life expectancy of the
Participant or Beneficiary or the joint life and last survivor
expectancy of the Participant and his Beneficiary, whichever is
applicable. For calendar years beginning before January 1, 1989, if a
Participant's Beneficiary is not his spouse, the method of distribution
selected must insure that at least 50 percent of the present value of
the amount available for distribution is paid within the life expectancy
of the Participant. For calendar years beginning after December 31, 1988
the amount to be distributed for each calendar year shall not be less
than an amount equal to the quotient obtained by dividing the
Participant's interest in his Account by the lesser of (i) the
applicable life expectancy under Section 8.01(b), or (ii) if a
Participant's Beneficiary is not his spouse, the applicable divisor
determined under Section 1.401(a)(9)-2, Q&A 4 of the Proposed Treasury
Regulations, or any successor regulations of similar import.
Distributions after the death of the Participant shall be made using the
applicable life expectancy under (i) above, without regard to Section
1.401(a)(9)-2 of such regulations.
The minimum distribution required under this subsection (a) for the
calendar year immediately preceding the calendar year in which the
Participant's required beginning date, as determined under Section
8.08(b), occurs shall be made on or before the Participant's required
beginning date, as so determined. Minimum distributions for other
calendar years shall be made on or before the close of such calendar
year.
(b) ADDITIONAL REQUIREMENTS FOR DISTRIBUTIONS AFTER DEATH OF
PARTICIPANT.
(1) DISTRIBUTION BEGINNING BEFORE DEATH. If the Participant dies
before distribution of his benefits has begun, distributions
shall be made in accordance with the provisions of this
paragraph. Distributions under Section 8.01(a) shall be completed
by the close of the calendar year in which the fifth anniversary
of the death of the Participant occurs. Distributions under
Section 8.01(b) shall commence, if the Beneficiary is not the
Participant's spouse, not later than the close of the calendar
year immediately following the calendar year in which the death
of the Participant occurs. Distributions under Section 8.01(b) to
a Beneficiary who is the Participant's surviving spouse shall
commence not later than the close of the calendar year in which
the Participant would have attained age 70-1/2 or, if later, the
close of the calendar year immediately following the calendar
year in which the death of the Participant occurs. In the event
such spouse dies prior to the date distribution to him or her
commences, he or she will be treated for purposes of this
subsection (other than the preceding sentence) as if he or she
were the Participant. If the Participant has not designated a
Beneficiary, or the Participant or Beneficiary has not
effectively selected a method of distribution, distribution of
the Participant's benefit shall be completed by the close of the
calendar year in which the fifth anniversary of the death of the
Participant occurs.
Any amount paid to a child of the Participant will be treated as
if it had been paid to the surviving spouse if the amount becomes
payable to the surviving spouse when the child reaches the age of
majority.
32.
For purposes of this subsection (b)(1), the life expectancy of a
Beneficiary who is the Participant's surviving spouse shall be
recalculated annually unless the Participant's spouse irrevocably
elects otherwise prior to the time distributions are required to
begin. Life expectancy shall be computed in accordance with the
provisions of subsection (a) above.
(2) DISTRIBUTION BEGINNING AFTER DEATH. If the Participant dies
after distribution of his benefits has begun, distributions to
the Participant's Beneficiary will be made at least as rapidly as
under the method of distribution being used as of the date of the
Participant's death.
For purposes of this Section 8.04(b), distribution of a Participant's
interest in his Account will be considered to begin as of the
Participant's required beginning date, as determined under Section
8.08(b). If distribution in the form of an annuity irrevocably commences
prior to such date, distribution will be considered to begin as of the
actual date distribution commences.
(c) LIFE EXPECTANCY. For purposes of this Section, life expectancy shall
be recalculated annually in the case of the Participant or a Beneficiary
who is the Participant's spouse unless the Participant or Beneficiary
irrevocably elects otherwise prior to the time distributions are
required to begin. If not recalculated in accordance with the foregoing,
life expectancy shall be calculated using the attained age of the
Participant or Beneficiary, whichever is applicable, as of such
individual's birth date in the first year for which a minimum
distribution is required reduced by one for each elapsed calendar year
since the date life expectancy was first calculated. For purposes of
this Section, life expectancy and joint life and last survivor
expectancy shall be computed by use of the expected return multiples in
Table V and VI of section 1.72-9 of the income tax Regulations.
A Participant's interest in his Account for purposes of this Section
8.04 shall be determined as of the last valuation date in the calendar
year immediately preceding the calendar year for which a minimum
distribution is required, increased by the amount of any contributions
allocated to, and decreased by any distributions from, such Account
after the valuation date. Any distribution for the first year for which
a minimum distribution is required made after the close of such year
shall be treated as if made prior to the close of such year.
8.05 IMMEDIATE DISTRIBUTIONS
If the Account distributable to a Participant exceeds, or at the time of any
prior distribution exceeded, $3,500, no distribution will be made to the
Participant before he reaches his Normal Retirement Age (or age 62, if later),
unless the written consent of the Participant has been obtained. Such consent
shall be made in writing within the 90-day period ending on the Participant's
Annuity Starting Date. Within the period beginning 90 days before the
Participant's Annuity Starting Date and ending 30 days before such Date, the
Administrator will provide such Participant with written notice comparable to
the notice described in Section 8.03(b) containing a general description of the
material features and an explanation of the relative values of the optional
forms of benefit available under the Plan and informing the Participant of his
right to defer receipt of the distribution until his Normal Retirement Age (or
age 62, if later).
The consent of the Participant's spouse must also be obtained if the Participant
is subject to the provisions of Section 8.03(a), unless the distribution will be
made in the form of the applicable retirement annuity contract described in
Section 8.03(b). A spouse's consent to early distribution, if required, must
satisfy the requirements of Section 8.03(d).
Neither the consent of the Participant nor the Participant's spouse shall be
required to the extent that a distribution is required to satisfy Section
401(a)(9) or Section 415 of the Code. In addition, upon termination of the Plan
if it does not offer an annuity option (purchased from a commercial provider)
and if the Employer or any Related Employer does not maintain another defined
contribution Plan (other than an
33.
Employee stock ownership Plan as defined in Code Section 4975(e)(7)) the
Participant's Account will, without the Participant's consent, be distributed
to the Participant. However, if any Related Employer maintains another
defined contribution Plan (other than an Employee stock ownership Plan as
defined in Section 4975(e)(7) of the Code) then the Participant's Account
will be transferred, without the Participant's consent, to the other Plan if
the Participant does not consent to an immediate distribution.
8.06 DETERMINATION OF METHOD OF DISTRIBUTION
The Participant will determine the method of distribution of benefits to himself
and may determine the method of distribution to his Beneficiary. Such
determination will be made prior to the time benefits become payable under the
Plan. If the Participant does not determine the method of distribution to his
Beneficiary or if the Participant permits his Beneficiary to override his
determination, the Beneficiary, in the event of the Participant's death, will
determine the method of distribution of benefits to himself as if he were the
Participant. A determination by the Beneficiary must be made no later than the
close of the calendar year in which distribution would be required to begin
under Section 8.04(b) or, if earlier, the close of the calendar year in which
the fifth anniversary of the death of the Participant occurs.
8.07 NOTICE TO TRUSTEE
The Administrator Will notify the Trustee in a medium acceptable to the Trustee
whenever any Participant or Beneficiary is entitled to receive benefits under
the Plan. The Administrator's notice shall indicate the form of benefits that
such Participant or Beneficiary shall receive and (in the case of distributions
to a Participant) the name of any designated Beneficiary or Beneficiaries.
8.08 TIME OF DISTRIBUTION
In no event will distribution to a Participant be made later than the earlier of
the dates described in (a) and (b) below:
(a) Absent the consent of the Participant (and his spouse, if
appropriate), the 60th day after the close of the Plan Year in which
occurs the later of the date on which the Participant attains age 65,
the date on which the Participant, ceases to be employed by the
Employer; or the 10th anniversary of the year in which the Participant
commenced participation in the Plan; and
(b) April 1 of the calendar year first following the calendar year in
which the Participant attains age 70-1/2 or, in the case of a
Participant who had attained age 70-1/2 before January 1, 1988, the
required beginning date determined in accordance with (1) or (2) below:
(1) The required beginning date of a Participant who is not a
5-percent owner is the first day of April of the calendar year
following the calendar year in which the later of retirement or
attainment of age 70-1/2 occurs.
(2) The required beginning date of a Participant who is a
5-percent owner during any year beginning after December 31,
1979, is the first day of April following the later of:
(i) the calendar year in which the Participant attains
age 70-1/2, or
(ii) the earlier of the calendar year with or within which
ends the Plan year in which the Participant becomes a
5-percent owner, or the calendar year in which the
Participant retires.
Notwithstanding the foregoing, in the case of a Participant who attained age
70-1/2 during 1988 and who had not retired prior to January 1, 1989, the
required beginning date described in this paragraph shall be April 1, 1990.
Notwithstanding (a) above, the failure of a Participant (and spouse) to consent
to a distribution while a benefit is immediately distributable, within the
meaning of Section 8.05, shall be deemed to be an election to defer
34.
commencement of payment of any benefit sufficient to satisfy (a) above. Once
distributions have begun to a 5-percent owner under (b) above, they must
continue to be distributed, even if the Participant ceases to be a 5-percent
owner in a subsequent year. For purposes of (b) above, a Participant is
treated as a 5-percent owner if such Participant is a 5-percent owner as
defined in Section 416(i) of the Code (determined in accordance with Section
416 but without regard to whether the Plan is top-heavy) at any time during
the Plan year ending with or within the calendar year in which such owner
attains age 66-1/2 or any subsequent Plan year.
The Administrator shall notify the Trustee in a medium acceptable to the Trustee
whenever a distribution is necessary in order to comply with the minimum
distribution rules set forth in this Section.
8.09 WHEREABOUTS OF PARTICIPANTS AND BENEFICIARIES
The Administrator will at all times be responsible for determining the
whereabouts of each Participant or Beneficiary who may be entitled to benefits
under the Plan and will at all times be responsible for instructing the Trustee
in writing as to the current address of each such Participant or Beneficiary.
The Trustee will be entitled to rely on the latest written statement received
from the Administrator as to such addresses. The Trustee will be under no duty
to make any distributions under the Plan unless and until it has received
written instructions from the Administrator satisfactory to the Trustee
containing the name and address of the distributor, the time when the
distribution is to occur, and the form which the distribution will take.
Notwithstanding the foregoing, if the Trustee attempts to make a distribution in
accordance with the Administrator's instructions but is unable to make such
distribution because the whereabouts of the distributee is unknown, the Trustee
will notify the Administrator of such situation and thereafter the Trustee will
be under no duty to make any further distributions to such distributee until it
receives further written instructions from the Administrator. If a benefit is
forfeited because the Administrator determines that the Participant or
beneficiary cannot be found, such benefit will be reinstated by the Sponsor if a
clam is filed by the Participant or Beneficiary with the Administrator and the
Administrator confirms the claim to the Sponsor.
ARTICLE 9 TOP-HEAVY PROVISIONS.
9.01 APPLICATION
If the Plan is or becomes a Top-Heavy Plan in any Plan Year or is automatically
deemed to be Top-Heavy in accordance with the Employer's election in Section
1.12(a)(1) of the Adoption Agreement, the provisions of this Article 9 shall
supersede any conflicting provision in the Plan.
9.02 DEFINITIONS
For purposes of this Article 9, the following terms have the meanings set forth
below:
(a) KEY EMPLOYEE. Any Employee or former Employee (and the Beneficiary
of any such Employee) who at any time during the determination period
was (i) an officer of the Employer whose annual Compensation exceeds 50
percent of the dollar limitation under Section 415(b)(1)(A) of the Code,
(ii) an owner (or considered an owner under Section 318 of the Code) of
one of the ten largest interests in the Employer if such individual's
annual Compensation exceeds the dollar limitation under Section
415(c)(1)(A) of the Code, (iii) a 5-percent owner of the Employer, or
(iv) a 1-percent owner of the Employer who has annual Compensation of
more than $150,000. For purposes of this paragraph, the determination
period is the Plan Year containing the Determination Date and the four
preceding Plan Years. The determination of who is a Key Employee shall
be made in accordance with Section 416(i)(1) of the Code and the
regulations thereunder. Annual Compensation means Compensation as
defined in Section 5.03(e)(2), but including amounts contributed by the
Employer pursuant to a salary reduction agreement which are excludable
from the Employee's gross income under Section 125, Section 402(a)(8),
and Section 403(b) of the Code.
35.
(b) TOP-HEAVY PLAN. The Plan is a Top-Heavy Plan if any of the following
conditions exists:
(1) the Top-Heavy Ratio for the Plan exceeds 60 percent and the
Plan is not part of any Required Aggregation Group or Permissive
Aggregation Group;
(2) the Plan is a part of a Required Aggregation Group but not
part of a Permissive Aggregation Group and the Top-Heavy Ratio
for the Required Aggregation Group exceeds 60 percent; or
(3) the Plan is a part of a Required Aggregation Group and a
Permissive Aggregation Group and the Top-Heavy Ratio for both
Groups exceeds 60 percent.
(c) TOP-HEAVY RATIO.
(1) With respect to this Plan, or with respect to any Required
Aggregation Group or Permissive Aggregation Group that consists
solely of defined contribution Plans (including any simplified
Employee pension Plans) and the Employer has not maintained any
defined benefit Plan which during the 5-year period ending on the
determination date(s) has or has had accrued benefits, the
Top-Heavy Ratio is a fraction, the numerator of which is the sum
of the account balances of all Key Employees under the Plans as
of the Determination Date (including any part of any account
balance distributed in the 5-year period ending on the
Determination Date), and the denominator of which is the sum of
all account balances (including any part of any account balance
distributed in the 5-year period ending on the Determination
Date) of all Participants under the Plans as of the Determination
Date. Both the numerator and denominator of the Top-Heavy Ratio
shall be increased, to the extent required by Section 416 of the
Code, to reflect any contribution which is due but unpaid as of
the Determination Date.
(2) With respect to any Required Aggregation Group or Permissive
Aggregation Group that includes one or more defined benefit Plans
which, during the 5-year period ending on the Determination Date,
has covered or could cover a Participant in this Plan, the
Top-Heavy Ratio is a fraction, the numerator of which is the sum
of the account balances under the defined contribution Plans for
all Key Employees and the present value of accrued benefits under
the defined benefit Plans for all Key Employees, and the
denominator of which is the sum of the account balances under the
defined contribution Plans for all Participants and the present
value of accrued benefits under the defined benefit Plans for all
Participants. Both the numerator and denominator of the Top-Heavy
Ratio shall be increased for any distribution of an account
balance or an accrued benefit made in the 5-year period ending on
the Determination Date and any contribution due but unpaid as of
the Determination Date.
(3) For purposes of (1) and (2) above, the value of Accounts and
the present value of accrued benefits will be determined as of
the most recent Valuation Date that falls within or ends with the
12-month period ending on the Determination Date, except as
provided in Section 416 of the Code and the regulations
thereunder for the first and second Plan years of a defined
benefit Plan. The Account and accrued benefits of a Participant
(i) who is not a Key Employee but who was a Key Employee in a
prior year, or (ii) who has not been credited with at least one
Hour of Service with the Employer at any time during the 5-year
period ending on the Determination Date, will be disregarded. The
calculation of the Top-Heavy Ratio, and the extent to which
distributions, rollovers, and transfers are taken into account,
shall be made in accordance with Section 416 of the Code and the
regulations thereunder. Deductible Employee contributions shall
not be taken into account for purposes of computing the Top-Heavy
Ratio. When aggregating Plans, the value of Accounts and accrued
benefits shall be calculated with reference to the Determination
Dates that fall within the same calendar year.
For purposes of determining if the Plan, or any other Plan
included in a Required Aggregation Group of which this Plan is a
part, is a Top-Heavy Plan, the accrued benefit in a defined
benefit Plan of an Employee other than a Key Employee shall be
determined under (a) the method, if any, that uniformly applies
for accrual purposes under all Plans maintained by the Employer,
or (b) if there is
36.
no such method, as if such benefit accrued not more rapidly
than the slowest accrual rate permitted under the fractional
accrual rate of Section 41l(b)(1)(C) of the Code.
(d) PERMISSIVE AGGREGATION GROUP. The Required Aggregation Group plus
any other qualified Plans of the Employer or a Related Employer which,
when considered as a group with the Required Aggregation Group, would
continue to satisfy the requirements of Sections 401(a)(4) and 410 of
the Code.
(e) REQUIRED AGGREGATION GROUP.
(1) Each qualified Plan of the Employer or Related Employer in
which at least one Key Employee participates, or has participated
at any time during the determination period (regardless of
whether the Plan has terminated), and
(2) any other qualified Plan of the Employer or Related Employer
which enables a Plan described in (1) above to meet the
requirements of Sections 401(a)(4) or 410 of the Code.
(f) DETERMINATION DATE. For any Plan Year of the Plan subsequent to the
first Plan Year, the last day of the preceding Plan Year. For the first
Plan Year of the Plan, the last day of that Plan Year.
(g) VALUATION DATE. The Determination Date.
(h) PRESENT VALUE. Present value shall be based only on the interest
rate and mortality table specified in the Adoption Agreement.
9.03 MINIMUM CONTRIBUTION
(a) Except as otherwise provided in (b) and (c) below, the Discretionary
Contributions made on behalf of any Participant who is not a Key
Employee shall not be less than the lesser of 3 percent (or such other
percent elected by the Employer in Section 1.12(c)) of such
Participant's Compensation or, in the case where the Employer has no
defined benefit Plan which designates this Plan to satisfy Section 401
of the Code, the largest percentage of Employer contributions, as a
percentage of the Key Employee's Compensation, as limited by Section
401(a)(17) of the Code, made on behalf of any Key Employee for that
year. For purposes of computing the minimum contribution, Compensation
shall mean Compensation as limited by Section 401(a)(17) of the Code.
Further, the minimum contribution under this Section 9.03, shall be made
even though, under other Plan provisions, the Participant would not
otherwise be entitled to receive a contribution, or would have received
a lesser contribution for the year, because (i) the Participant failed
to complete 1,000 Hours of Service or any equivalent service requirement
provided in the Adoption Agreement; or (ii) the Participant's
Compensation was less than a stated amount.
(b) The provisions of (a) above shall not apply to any Participant who
was not employed by the Employer on the last day of the Plan Year.
(c) The Employer contributions for the Plan Year made on behalf of each
Participant who is not a Key Employee and who is a Participant in a
defined benefit Plan maintained by the Employer shall not be less than 5
percent of such Participant's Compensation, unless the Employer has
provided in Section 1.12(c) that the minimum contribution requirement
will be met in the other Plan or Plans of the Employer.
(d) The minimum contribution required under (a) above (to the extent
required to be nonforfeitable under Section 416(b) of the Code) may not
be forfeited under Section 41l(a)(3)(B) or 41l(a)(3)(D) of the Code.
37.
9.04 ADJUSTMENT TO THE LIMITATION ON CONTRIBUTIONS AND BENEFITS
If this Plan is in Top-Heavy status, the number 100 shall be substituted for the
number 125 in subsections (e)(3) and (e)(4) of Section 5.03. However, this
substitution shall not take effect with respect to this Plan in any Plan Year in
which the following requirements are satisfied:
(a) The Employer contributions for such Plan Year made on behalf of each
Participant who is not a Key Employee and who is a Participant in a
defined benefit Plan maintained by the Employer is not less than 7-1/2
percent of such Participant's Compensation.
(b) The sum of the present value as of the Determination Date of (i) the
aggregate accounts of all Key Employees under all defined contribution
Plans of the Employer and (ii) the cumulative accrued benefits of all
Key Employees under all defined benefit Plans of the Employer does not
exceed 90 percent of the same amounts determined for all Participants
under all Plans of the Employer that are Top-Heavy Plans, excluding
Accounts and accrued benefits for Employees who formerly were but are no
longer Key Employees.
The substitutions of the number 100 for 125 shall not take effect in any
limitation Year with respect to any Participant for whom no benefits are
accrued or contributions made for such Year.
9.05 MINIMUM VESTING
For any Plan Year in which the Plan is a Top-Heavy Plan and all Plan Years
thereafter, the Top-Heavy vesting schedule elected in Section 1.07(a)(1) or
1.12(d), as applicable, will automatically apply to the Plan. The Top-Heavy
vesting schedule applies to all benefits within the meaning of Section 411(a)(7)
of the Code except those attributable to Employee Contributions or those already
subject to a vesting schedule which vests at least as rapidly in all cases as
the schedule elected in Section 1.12(d), including benefits accrued before the
Plan becomes a Top-Heavy Plan. Further, no decrease in a Participant's
nonforfeitable percentage may occur in the event the Plan's status as a
Top-Heavy Plan changes for any Plan Year. However, this Section 9.05 does not
apply to the Account of any Employee who does not have an Hour of Service after
the Plan has initially become a Top-Heavy Plan and such Employee's Account
attributable to Employer Contributions will be determined without regard to this
Section 9.05.
ARTICLE 10 AMENDMENT AND TERMINATION.
10.01 AMENDMENT BY EMPLOYER
The Employer reserves the authority, subject to the provisions of Article 1 and
Section 10.03, to amend the Plan:
(a) CHANGING ELECTIONS CONTAINED IN THE ADOPTION AGREEMENT. By filing
with the Trustee an amended Adoption Agreement, executed by the Employer
only, on which said Employer has indicated a change or changes in
provisions previously elected by it. Such changes are to be effective on
the effective date of such amended Adoption Agreement except that
retroactive changes to a previous election or elections pursuant to the
regulations issued under Section 401(a)(4) of the Code shall be
permitted. Any such change notwithstanding, no Participant's Account
shall be reduced by such change below the amount to which the
Participant would have been entitled if he had voluntarily left the
employ of the Employer immediately prior to the date of the change. The
Employer may from time to time make any amendment to the Plan that may
be necessary to satisfy Sections 415 or 416 of the Code because of the
required aggregation of multiple Plans by completing overriding Plan
language in the Adoption Agreement. The Employer may also add certain
model amendments published by the Internal Revenue Service which
specifically provide that their adoption will not cause the Plan to be
treated as an individually designed Plan; or
(b) OTHER CHANGES. By amending any provision of the Plan for any reason
other than those specified in (a) above. However, upon making such
amendment, including a waiver of the minimum funding requirement
38.
under Section 412(d) of the Code, the Employer may no longer
participate in this prototype Plan arrangement and will be deemed to
have an individually designed Plan. Following such amendment, the
Trustee may transfer the assets of the Trust to the trust forming part
of such newly adopted Plan upon receipt of sufficient evidence (such as
a determination letter or opinion letter from the Internal Revenue
Service or an opinion of counsel satisfactory to the Trustee) that such
trust will be a qualified trust under the Code.
(c) AMENDMENT PROCEDURE. The Employer reserves the authority to amend
the Plan by filing with the Trustee an amended Adoption Agreement,
executed by the Employer only, on which said Employer has indicated a
change or changes in provisions previously elected by it. Such change(s)
is/are to be effective on the effective date of such amended Adoption
Agreement. The Employer may from time to time make any amendment to the
Plan that may be necessary to satisfy the Internal Revenue Code or
ERISA. The Board of Directors for a Corporate Employer or other
individual specified in the resolution adopting this Plan shall act on
behalf of a Corporation.
10.02 AMENDMENT BY PROTOTYPE SPONSOR
The Prototype Sponsor may in its discretion amend the Plan or the Adoption
Agreement at any time, subject to the provisions of Article 1 and Section 10.03,
and provided that the Prototype Sponsor mails a copy of such amendment to the
Employer at its last known address as shown on the books of the Prototype
Sponsor.
10.03 AMENDMENTS AFFECTING VESTED AND/OR ACCRUED BENEFITS
(a) Except as permitted by Section 10.04, no amendment to the Plan shall
be effective to the extent that it has the effect of decreasing a
Participant's Account or eliminating an optional form of benefit with
respect to benefits attributable to service before the amendment.
Furthermore, if the vesting schedule of the Plan is amended, the
nonforfeitable interest of a Participant in his Account, determined as
of the later of the date the amendment is adopted or the date it becomes
effective, will not be less than the Participant's nonforfeitable
interest in his Account determined without regard to such amendment.
(b) If the Plan's vesting schedule is amended, including any amendment
resulting from a change to or from Top-Heavy Plan status, or the Plan is
amended in any way that directly or indirectly affects the computation
of a Participant's nonforfeitable interest in his Account, each
Participant with at least three (3) Years of Service for Vesting with
the Employer may elect, within a reasonable period after the adoption of
the amendment, to have the nonforfeitable percentage of his Account
computed under the Plan without regard to such amendment. The
Participant's election may be made within 60 days from the latest of (i)
the date the amendment is adopted; (ii) the date the amendment becomes
effective; or (iii) the date the Participant is issued written notice of
the amendment by the Employer or the Administrator.
10.04 RETROACTIVE AMENDMENTS
An amendment made by the sponsor in accordance with Section 10.02 may be made
effective on a date prior to the first day of the Plan Year in which it is
adopted if such amendment is necessary or appropriate to enable the Plan and
Trust to satisfy the applicable requirements of the Code or to conform the Plan
to any change in federal law, or to any regulations or ruling thereunder. Any
retroactive amendment by the Employer shall be subject to the provisions of
Section 10.01.
10.05 TERMINATION
The Employer has adopted the Plan with the intention and expectation that
contributions will be continued indefinitely. However, said Employer has no
obligation or liability whatsoever to maintain the Plan for any length
39.
of time and may discontinue contributions under the Plan or terminate the
Plan at any time by written notice delivered to the Trustee without any
liability hereunder for any such discontinuance or termination.
10.06 DISTRIBUTION UPON TERMINATION OF THE PLAN
Upon termination or partial termination of the Plan or complete discontinuance
of contributions thereunder, each Participant (including a terminated
Participant with respect to amounts not previously forfeited by him) who is
affected by such termination or partial termination or discontinuance will have
a fully vested interest in his Account, and, subject to Section 4.05 and Article
8, the Trustee will distribute to each Participant or other person entitled to
distribution the balance of the Participant's Account in a single lump sum
payment. In the absence of such instructions, the Trustee will notify the
Administrator of such situation and the Trustee will be under no duty to make
any distributions under the Plan until it receives written instructions from the
Administrator. Upon the completion of such distributions, the Trust will
terminate, the Trustee will be relieved from all liability under the Trust, and
no Participant or other person will have any claims thereunder, except as
required by applicable law.
10.07 MERGER OR CONSOLIDATION OF PLAN; TRANSFER OF PLAN ASSETS
In case of any merger or consolidation of the Plan with, or transfer of assets
and liabilities of the Plan to, any other Plan, provision must be made so that
each Participant would, if the Plan then terminated, receive a benefit
immediately after the merger, consolidation or transfer which is equal to or
greater than the benefit he would have been entitled to receive immediately
before the merger, consolidation or transfer if the Plan had then terminated.
ARTICLE 11 AMENDMENT AND CONTINUATION OF PREDECESSOR PLAN; TRANSFER OF FUNDS TO
OR FROM OTHER QUALIFIED PLANS
11.01 AMENDMENT AND CONTINUATION OF PREDECESSOR PLAN
In the event the Employer has previously established a Plan (the "predecessor
Plan") which is a defined contribution Plan under the Code and which on the date
of adoption of the Plan meets the applicable requirements of section 401(a) of
the Code, the Employer may, in accordance with the provisions of the predecessor
Plan, amend and continue the predecessor Plan in the form of the Plan and become
the Employer hereunder, subject to the following:
(a) Subject to the provisions of the Plan, each individual who was a
Participant or former Participant in the predecessor Plan immediately
prior to the effective date of such amendment and continuation will
become a Participant or former Participant in the Plan;
(b) No election may be made under the vesting provisions of the Adoption
Agreement if such election would reduce the benefits of a Participant
under the Plan to less than the benefits to which he would have been
entitled if he voluntarily separated from the service of the Employer
immediately prior to such amendment and continuation;
(c) No amendment to the Plan shall decrease a Participant's accrued
benefit or eliminate an optional form of benefit and if the amendment of
the predecessor Plan in the form of the Plan results in a change in the
method of crediting service for vesting purposes between the general
method set forth in Section 2530.200b-2 of the Department of Labor
Regulations and the elapsed time method in Section 2.01(a)(33) of the
Plan, each Participant with respect to whom the method of crediting
vesting service is changed shall be treated in the manner set forth by
the provisions of Section 1.410(a)-7(f)(1) of the Treasury Regulations
which are incorporated herein by reference.
40.
(d) The amounts standing to the credit of a Participant's Account
immediately prior to such amendment and continuation which represent the
amounts properly attributable to (i) contributions by the Participant
and (ii) contributions by the Employer and forfeitures will constitute
the opening balance of his Account or Accounts under the Plan;
(e) Amounts being paid to a former Participant or to a Beneficiary in
accordance with the provisions of the predecessor Plan will continue to
be paid in accordance with such provisions;
(f) Any election and waiver of the qualified pre-retirement annuity in
effect after August 23, 1984, under the predecessor Plan immediately
before such amendment and continuation will be deemed a valid election
and waiver of Beneficiary under Section 8.04 if such designation
satisfies the requirements of Section 8.04(d), unless and until the
Participant revokes such election and waiver under the Plan; and
(g) Unless the Employer and the Trustee agree otherwise, all assets of
the predecessor trust will be deemed to be assets of the Trust as of the
effective date of such amendment. Such assets will be invested by the
Trustee as soon as reasonably practicable pursuant to Article 6. The
Employer agrees to assist the Trustee in any way requested by the
Trustee in order to facilitate the transfer of assets from the
predecessor trust to the Trust Fund.
11.02 TRANSFER OF FUNDS FROM AN EXISTING PLAN
The Employer may from time to time direct the Trustee, in accordance with such
rules as the Trustee may establish, to accept cash, allowable Fund Shares or
Participant loan promissory notes transferred for the benefit of Participants
from a trust forming part of another qualified Plan under the Code, provided
such Plan is a defined contribution Plan. Such transferred assets will become
assets of the Trust as of the date they are received by the Trustee. Such
transferred assets will be credited to Participants' Account in accordance with
their respective interests immediately upon receipt by the Trustee. A
Participant's interest under the Plan in transferred assets which were fully
vested and nonforfeitable under the transferring Plan will be fully vested and
nonforfeitable at all times. Such transferred assets will be invested by the
Trustee in accordance with the provisions of paragraph (g) of Section 11.01 as
if such assets were transferred from a predecessor Plan. No transfer of assets
in accordance with this Section may cause a loss of an accrued or optional form
of benefit protected by Section 411 (d)(6) of the Code.
11.03 ACCEPTANCE OF ASSETS BY TRUSTEE
The Trustee will not accept assets which are not either in a medium proper for
investment under the Plan, as set forth in Section 1.14(b), or in cash. Such
assets shall be accompanied by written instructions showing separately the
respective contributions by the prior employer and by the Employee, and
identifying the assets attributable to such contributions. The Trustee shall
establish such accounts as may be necessary or appropriate to reflect such
contributions under the Plan. The Trustee shall hold such assets for investment
in accordance with the provisions of Article 6, and shall in accordance with the
written instructions of the Employer make appropriate credits to the Accounts of
the Participants for whose benefit assets have been transferred.
11.04 TRANSFER OF ASSETS FROM TRUST
The Employer may direct the Trustee to transfer all or a specified portion of
the Trust assets to any other Plan or Plans maintained by the Employer or the
employer or employers of a former Participant or Participants, provided that the
Trustee has received evidence satisfactory to it that such other Plan meets all
applicable requirements of the Code. The assets so transferred shall be
accompanied by written instructions from the Employer naming the persons for
whose benefit such assets have been transferred, showing separately the
respective contributions by the Employer and by each Participant, if any, and
identifying the assets attributable to the various contributions. The Trustee
shall have no further liabilities with respect to assets so transferred.
41.
ARTICLE 12 MISCELLANEOUS
12.01 COMMUNICATION TO PARTICIPANTS
The Plan will be communicated to all Participants by the Employer promptly after
the Plan is adopted.
12.02 LIMITATION OF RIGHTS
Neither the establishment of the Plan and the Trust, nor any amendment thereof,
nor the creation of any fund or account, nor the payment of any benefits, will
be construed as giving to any Participant or other person any legal or equitable
right against the Employer, Administrator or Trustee, except as provided herein;
and in no event will the terms of employment or service of any Participant be
modified or in any way affected hereby. It is a condition of the Plan, and each
Participant expressly agrees by his participation herein, that each Participant
will look solely to the assets held in the Trust for the payment of any benefit
to which he is entitled under the Plan.
12.03 NONALIENABILITY OF BENEFITS AND QUALIFIED DOMESTIC RELATIONS ORDERS
The benefits provided hereunder will not be subject to alienation, assignment,
garnishment, attachment, execution or levy of any kind, either voluntarily or
involuntarily, and any attempt to cause such benefits to be so subjected will
not be recognized, except to such extent as may be required by law. The
preceding sentence shall also apply to the creation, assignment, or recognition
of a right to any benefit payable with respect to a Participant pursuant to a
domestic relations order, unless such order is determined by the Plan
Administrator to be a qualified domestic relations order, as defined in Section
414(p) of the Code, or any domestic relations order entered before January 1,
1985. The Administrator must establish reasonable procedures to determine the
qualified status of a domestic relations order. Upon receiving a domestic
relations order, the Administrator will promptly 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
Administrator must determine the qualified status of the order and must notify
the Participant and each alternate payee, in writing, of its determination. The
Administrator 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 the Department of Labor regulations.
If any portion of the Participant's Account is payable during the period the
Administrator is making its determination of the qualified status of the
domestic relations order, the Administrator must make a separate accounting of
the amounts payable. If the Administrator 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 Administrator will direct the Trustee to
distribute the payable amounts in accordance with the order. If the
Administrator does not make his determination of the qualified status of the
order within the 18 month determination period, the Administrator 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 Administrator later determines the order is a qualified domestic relations
order.
A domestic relations order will not fail to be deemed a qualified domestic
relations order merely because it requires the distribution or segregation of
all or part of a Participant's Account with respect to an alternate payee prior
to the Participant's earliest retirement age (as defined in Section 414(p) of
the Code) under the Plan. A distribution to an alternate payee prior to the
Participant's attainment of the earliest retirement age is available only if (1)
the order specifies distribution at that time; 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.
42.
12.04 FACILITY OF PAYMENT
In the event the Administrator determines, on the basis of medical reports or
other evidence satisfactory to the Administrator, that the recipient of any
benefit payments under the Plan is incapable of handling his affairs by reason
of minority, illness, infirmity or other incapacity, the Administrator may
direct the Trustee to disburse such payments to a person or institution
designated by a court which has jurisdiction over such recipient or a person or
institution otherwise having the legal authority under State law for the care
and control of such recipient. The receipt by such person or institution of any
such payments shall be complete acquittance therefore, and any such payment to
the extent thereof, shall discharge the liability of the Trust for the payment
of benefits hereunder to such recipient.
12.05 INFORMATION BETWEEN EMPLOYER AND TRUSTEE
The Employer agrees to furnish the Trustee, and the Trustee agrees to furnish
the Employer with such information relating to the Plan and Trust as may be
required by the other in order to carry out their respective duties hereunder,
including without limitation information required under the Code and any
regulations issued or forms adopted by the Treasury Department thereunder or
under the provisions of ERISA and any regulations issued or forms adopted by the
Labor Department thereunder.
12.06 EFFECT OF FAILURE TO QUALIFY UNDER CODE
Notwithstanding any other provision contained herein, if the Employer fails to
obtain or retain approval of the Plan by the Internal Revenue Service as a
qualified Plan under the Code, the Employer may no longer participate in this
prototype Plan arrangement and will be deemed to have an individually designed
Plan.
12.07 NOTICES
Any notice or other communication in connection with this Plan shall be deemed
delivered in writing if addressed as provided below and if either actually
delivered at said address or, in the case of a letter, three business days shall
have elapsed after the same shall have been deposited in the United States
mails, first-class postage prepaid and registered or certified:
(a) If to the Employer or Administrator, to it at the address set forth
in the Adoption Agreement, to the attention of the person specified to
receive notice in the Adoption Agreement;
(b) If to the Trustee, to it at the address set forth in the Adoption
Agreement;
or, in each case at such other address as the addressee shall have specified by
written notice delivered in accordance with the foregoing to the addresser's
then effective notice address.
12.08 GOVERNING LAW
The Plan and the accompanying Adoption Agreement will be construed, administered
and enforced according to ERISA, and to the extent not preempted thereby, the
laws of the Commonwealth of Massachusetts.
12.09 NON-DISCRIMINATION DATA SUBSTANTIATION
The Employer may elect to follow the guidelines for substantiating compliance
with the non-discrimination rules pursuant to Internal Revenue Service Revenue
Procedure 93-42, Data Substantiation Guidelines and Non-Discrimination
Requirements of Section 401(a)(4), 410(b), and Related Code Sections. The
guidance in this
43.
Revenue Procedure is designed to allow Employers to use alternative methods
for substantiating compliance with the non-discrimination requirements.
ARTICLE 13 PLAN ADMINISTRATION
13.01 POWERS AND RESPONSIBILITIES OF THE ADMINISTRATOR
The Administrator has the full power and the full responsibility to administer
the Plan in all of its details, subject, however, to the requirements of ERISA.
The Administrator's powers and responsibilities include, but are not limited to,
the following:
(a) To make and enforce such rules and regulations as it deems necessary
or proper for the efficient administration of the Plan;
(b) To interpret the Plan, its interpretation thereof in good faith to
be final and conclusive on all persons claiming benefits under the Plan;
(c) To decide all questions concerning the Plan and the eligibility of
any person to participate in the Plan;
(d) To administer the claims and review procedures specified in Section
13.03;
(e) To compute the amount of benefits which will be payable to any
Participant, former Participant or Beneficiary in accordance with the
provisions of the Plan;
(f) To determine the person or persons to whom such benefits will be
paid;
(g) To authorize the payment of benefits and provide for the
distribution of Code Section 402(f) notices;
(h) To comply with the reporting and disclosure requirements of Part 1
of Subtitle B of Title I of ERISA;
(i) To appoint such agents, counsel, accountants, and consultants as may
be required to assist in administering the Plan;
(j) By written instrument, to allocate and delegate its fiduciary
responsibilities in accordance with Section 405 of ERISA including the
formation of an Administrative Committee to administer the Plan;
(k) To provide bonding coverage as required under Section 412 of ERISA.
13.02 NONDISCRIMINATORY EXERCISE OF AUTHORITY
Whenever, in the administration of the Plan, any discretionary action by the
Administrator is required, the Administrator shall exercise its authority in a
nondiscriminatory manner so that all persons similarly situated will receive
substantially the same treatment.
13.03 CLAIMS AND REVIEW PROCEDURES
(a) CLAIMS PROCEDURE. If any person believes he is being denied any
rights or benefits under the Plan, such person may file a claim in
writing with the Administrator. If any such claim is wholly or partially
denied, the Administrator will notify such person of its decision in
writing. Such notification will contain (i) specific reasons for the
denial, (ii) specific reference to pertinent Plan provisions, (iii) a
description of any additional
44.
material or information necessary for such person to perfect such
claim and an explanation of why such material or information is
necessary, and (iv) information as to the steps to be taken if the
person wishes to submit a request for review. Such notification will
be given within 90 days after the claim is received by the
Administrator (or within 180 days, if special circumstances require
an extension of time for processing the claim, and if written notice
of such extension and circumstances is given to such person within
the initial 90-day period). If such notification is not given within
such period, the claim will be considered denied as of the last day
of such period and such person may request a review of his claim.
(b) REVIEW PROCEDURE. Within 60 days after the date on which a person
receives a written notice of a denied claim (or, if applicable, within
60 days after the date on which such denial is considered to have
occurred), such person (or his duly authorized representative) may (i)
file a written request with the Administrator for a review of his denied
claim and of pertinent documents and (ii) submit written issues and
comments to the Administrator. The Administrator will notify such person
of its decision in writing. Such notification will be written in a
manner calculated to be understood by such person and will contain
specific reasons for the decision as well as specific references to
pertinent Plan provisions. The decision on review will be made within 60
days after the request for review is received by the Administrator (or
within 120 days, if special circumstances require an extension of time
for processing the request, such as an election by the Administrator to
hold a hearing, and if written notice of such extension and
circumstances is given to such person within the initial 60-day period).
If the decision on review is not made within such period, the claim will
be considered denied.
13.04 NAMED FIDUCIARY
The Administrator is a "named fiduciary" for purposes of Section 402(a)(1) of
ERISA and has the powers and responsibilities with respect to the management and
operation of the Plan described herein.
13.05 COSTS OF ADMINISTRATION
Unless some or all are paid by the Employer, all reasonable costs and expenses
(including legal, accounting, and Employee communication fees) incurred by the
Administrator and the Trustee in administering the Plan and Trust will be paid
first from the forfeitures (if any) resulting under Section 7.07, then from the
remaining Trust Fund. All such costs and expenses paid from the Trust Fund will,
unless allocable to the Accounts of particular Participants, be charged against
the Accounts of all Participants on a prorata basis or in such other reasonable
manner as may be directed by the Employer.
ARTICLE 14 TRUST AGREEMENT
14.01 ACCEPTANCE OF TRUST RESPONSIBILITIES
By executing the Adoption Agreement, the Employer establishes a trust to hold
the assets of the Plan. By executing the Adoption Agreement, the Trustee agrees
to accept the rights, duties and responsibilities set forth in this Article 14.
14.02 ESTABLISHMENT OF TRUST FUND
A trust is hereby established under the Plan and the Trustee will open and
maintain a Trust account for the Plan and, as part thereof, Participants'
Accounts for such individuals as the Employer shall from time to time give
written notice to the Trustee of Participants in the Plan. The Trustee will
accept and hold in the Trust Fund such contributions on behalf of Participants
as it may receive from time to time from the Employer. The Trust Fund shall
45.
be fully invested and reinvested in accordance with the applicable provisions
of the Plan in Fund Shares or as otherwise provided in Section 14.10.
14.03 EXCLUSIVE BENEFIT
The Trustee shall hold the assets of the Trust Fund for the exclusive purpose of
providing benefits to Participants and Beneficiaries and defraying the
reasonable expenses of administering the Plan. No assets of the Plan shall
revert to the Employer except as specifically permitted by the terms of the
Plan.
14.04 POWERS OF TRUSTEE
The Trustee shall have no discretion or authority with respect to the investment
of the Trust Fund but shall act solely as a directed trustee of the funds
contributed to it. In addition to and not in limitation of such powers as the
Trustee has by law or, under any other provisions of the Plan, the Trustee will
have the following powers, each of which the Trustee exercises solely as
directed Trustee in accordance with the written direction of the Employer except
to the extent a Plan asset is subject to Participant direction of investment and
provided that no such power shall be exercised in any manner inconsistent with
the provisions of ERISA:
(a) to deal with all or any part of the Trust Fund and to invest all or
a part of the Trust Fund in investments available under the Plan,
without regard to the law of any state regarding proper investment;
(b) to retain uninvested such cash as it may deem necessary or
advisable, without liability for interest thereon, for the
administration of the Trust;
(c) to sell, convert, redeem, exchange, or otherwise dispose of all or
any part of the assets constituting the Trust Fund;
(d) to enforce by suit or otherwise, or to waive, its rights on behalf
of the Trust, and to defend claims asserted against it or the Trust,
provided that the Trustee is indemnified to its satisfaction against
liability and expenses;
(e) to employ such agents and counsel as may be reasonably necessary in
collecting, managing, administering, investing, distributing and
protecting the Trust Fund or the assets thereof and to pay them
reasonable Compensation;
(f) to compromise, adjust and settle any and all claims against or in
favor of it or the Trust;
(g) to oppose or participate in and consent to the reorganization,
merger, consolidation, or readjustment of the finances of any
enterprise, to pay assessments and expenses in connection therewith, and
to deposit securities under deposit agreements;
(h) to apply for or purchase annuity contracts in accordance with
Section 8.02;
(i) to hold securities unregistered, or to register them in its own name
or in the name of nominees;
(j) to appoint custodians to hold investments within the jurisdiction of
the district courts of the United States and to deposit securities with
stock clearing corporations or depositories or similar organizations;
(k) to make, execute, acknowledge and deliver any and all instruments
that it deems necessary or appropriate to carry out the powers herein
granted; and
(l) generally to exercise any of the powers of an owner with respect to
all or any part of the Trust Fund.
46.
The Employer specifically acknowledges and authorizes that affiliates of
the Trustee may act as its agent in the performance of ministerial, non
fiduciary duties under the Trust. The expenses and compensation of such
agent shall be paid by the Trustee.
The Trustee shall provide the Employer with reasonable notice of any
claim filed against the Plan or Trust or with regard to any related
matter, or of any claim filed by the Trustee on behalf of the Plan or
Trust or with regard to any related matter.
14.05 ACCOUNTS
The Trustee will keep full accounts of all receipts and disbursements and other
transactions hereunder. Within 60 days after the close of each Plan Year, within
60 days after termination of the Trust, and at such other times as may be
appropriate, the Trustee will determine the then net fair market value of the
Trust Fund as of the close of the Plan Year, as of the termination of the Trust,
or as of such other time, whichever is applicable, and will render to the
Employer and Administrator an account of its administration of the Trust during
the period since the last such accounting, including all allocations made by it
during such period.
14.06 APPROVING OF ACCOUNTS
To the extent permitted by law, the written approval of any account by the
Employer or Administrator will be final and binding, as to all matters and
transactions stated or shown therein, upon the Employer, Administrator,
Participants and all persons who then are or thereafter become interested in the
Trust. The failure of the Employer or Administrator to notify the Trustee within
six (6) months after the receipt of any account of its objection to the account
will, to the extent permitted by law, be the equivalent of written approval. If
the Employer or Administrator files any objections within such six (6) month
period with respect to any matters or transactions stated or shown in the
account, and the Employer or Administrator and the Trustee cannot amicably
settle the question raised by such objections, the Trustee will have the right
to have such questions settled by judicial proceedings. Nothing herein contained
will be construed so as to deprive the Trustee of the right to have judicial
settlement of its accounts. In any proceeding for a judicial settlement of any
account or for instructions, the only necessary parties will be the Trustee, the
Employer and the Administrator.
14.07 DISTRIBUTION FROM TRUST FUND
The Trustee shall make such distribution from the Trust Fund as the Employer or
Administrator may, in writing or any other form(s) acceptable to the Trustee,
direct, as provided by the terms of the Plan, upon certification by the Employer
or Administrator that the same is for the exclusive benefit of Participants or
their Beneficiaries, or for the payment of expenses of administering the Plan.
14.08 TRANSFER OF AMOUNTS FROM QUALIFIED PLAN
If the Plan provides that amounts may be transferred to the Plan from another
qualified Plan or trust under Section 401(a) of the Code, such transfer shall be
made in accordance with the provisions of the Plan and with such rules as may be
established by the Trustee. The Trustee will only accept assets which are in a
medium proper for investment under the Agreement or in cash. Such amounts shall
be accompanied by written instructions showing separately the respective
contributions by the prior employer and the transferring Employee, and
identifying the assets attributable to such contributions. The Trustee shall
hold such assets for investment in accordance with the provisions of this
Agreement.
47.
14.09 TRANSFER OF ASSETS FROM TRUST
Subject to the provisions of the Plan, the Employer may direct the Trustee to
transfer all or a specified portion of the Trust assets to any other Plan or
Plans maintained by the Employer or the employer or employers of a former
Participant or Participants, provided that the Trustee has received evidence
satisfactory to it that such other Plan meets all applicable requirements of the
Code. The assets so transferred shall be accompanied by written instructions
from the Employer naming the persons for whose benefit such assets have been
transferred, showing separately the respective contributions by the Employer and
by each Participant, if any, and identifying the assets attributable to the
various contributions. The Trustee shall have no further liabilities with
respect to assets so transferred.
14.10 RESERVED
14.11 VOTING; DELIVERY OF INFORMATION
The Trustee shall deliver, or cause to be executed and delivered, to the
Employer or Plan Administrator all notices, prospectuses, financial statements,
proxies and proxy soliciting materials received by the Trustee relating to
securities held the Trust or, if applicable, deliver these materials to the
appropriate Participant or the Beneficiary of a deceased Participant. The
Trustee shall not vote any securities held by the Trust except in accordance
with the written instructions of the Employer, Participant or the Beneficiary of
the Participant, if the Participant is deceased; provided, however, that the
Trustee may, in the absence of instructions, vote "present" for the sole purpose
of allowing such shares to be counted for establishment of a quorum at a
shareholders' meeting. The Trustee shall have no duty to solicit instructions
from Participants, the Beneficiary or the Employer.
14.12 COMPENSATION AND EXPENSES OF TRUSTEE
The Trustee's fee for performing its duties hereunder will be such reasonable
amounts as the Trustee may from time to time specify by written agreement with
the Employer. Such fee, any taxes of any kind which may be levied or assessed
upon or in respect of the Trust Fund and any and all expenses, including without
limitation legal fees and expenses of administrative and judicial proceedings,
reasonably incurred by the Trustee in connection with its duties and
responsibilities hereunder will, unless some or all have been paid by said
Employer, be paid first from forfeitures resulting under Section 7.07, then from
the remaining Trust Fund and will, unless allocable to the Accounts of
particular Participants, be charged against the respective Accounts of all
Participants, in such reasonable manner as the Trustee may determine.
14.13 RELIANCE BY TRUSTEE ON OTHER PERSONS
The Trustee may rely upon and act upon any writing from any person authorized by
the Employer or Administrator to give instructions concerning the Plan and may
conclusively rely upon and be protected in acting upon any written order from
the Employer or Administrator or upon any other notice, request, consent,
certificate, or other instructions or paper reasonably believed by it to have
been executed by a duly authorized person, so long as it acts in good faith in
taking or omitting to take any such action. The Trustee need not inquire as to
the basis in fact of any statement in writing received from the Employer or
Administrator.
The Trustee will be entitled to rely on the latest certificate it has received
from the Employer or Administrator as to any person or persons authorized to act
for the Employer or Administrator hereunder and to sign on behalf of the
Employer or Administrator any directions or instructions, until it receives from
the Employer or Administrator written notice that such authority has been
revoked.
Notwithstanding any provision contained herein, the Trustee will be under no
duty to take any action with respect to any Participant's Account (other than as
specified herein) unless and until the Employer or Administrator furnishes
48.
the Trustee with written instructions on a form acceptable to the Trustee,
and the Trustee agrees thereto in writing. The Trustee will not be liable for
any action taken pursuant to the Employer's or Administrator's written
instructions (nor for the collection of contributions under the Plan, nor the
purpose or propriety of any distribution made thereunder).
14.14 INDEMNIFICATION BY EMPLOYER
The Employer shall indemnify and save harmless the Trustee from and against any
and all liability to which the Trustee may be subjected by reason of any act or
conduct (except willful misconduct or negligence) in its capacity as Trustee,
including all expenses reasonably incurred in its defense.
14.15 CONSULTATION BY TRUSTEE WITH COUNSEL
The Trustee may consult with legal counsel (who may be but need not be counsel
for the Employer or the Administrator) concerning any question which may arise
with respect to its rights and duties under the Plan and Trust, and the opinion
of such counsel will, to the extent permitted by law, be fall and complete
protection in respect of any action taken or omitted by the Trustee hereunder in
good faith and in accordance with the opinion of such counsel.
14.16 PERSONS DEALING WITH THE TRUSTEE
No person dealing with the Trustee will be bound to see to the application of
any money or property paid or delivered to the Trustee or to inquire into the
validity or propriety of any transactions.
14.17 RESIGNATION OR REMOVAL OF TRUSTEE
The Trustee may resign at any time by written notice to the Employer, which
resignation shall be effective 60 days after delivery to the Employer. The
Trustee may be removed by the Employer by written notice to the Trustee, which
removal shall be effective 60 days after delivery to the Trustee.
Upon resignation or removal of the Trustee, the Employer may appoint a successor
trustee. Any such successor trustee will, upon written acceptance of his
appointment, become vested with the estate, rights, powers, discretion, duties
and obligations of the Trustee hereunder as if he had been originally named as
Trustee in this Agreement.
Upon resignation or removal of the Trustee, the Employer will no longer
participate in this prototype Plan and will be deemed to have adopted an
individually designed Plan. In such event, the Employer shall appoint a
successor trustee within said 60-day period and the Trustee will transfer the
assets of the Trust to the successor trustee upon receipt of sufficient evidence
(such as a determination letter or opinion letter from the Internal Revenue
Service or an opinion of counsel satisfactory to the Trustee) that such trust
will be a qualified trust under the Code.
The appointment of a successor trustee shall be accomplished by delivery to the
Trustee of written notice that the Employer has appointed such successor
trustee, and written acceptance of such appointment by the successor trustee.
The Trustee may, upon transfer and delivery of the Trust Fund to a successor
trustee, reserve such reasonable amount as it shall deem necessary to provide
for its fees, Compensation, costs and expenses, or for the payment of any other
liabilities chargeable against the Trust Fund for which it may be liable. The
Trustee shall not be liable for the acts or omissions of any successor trustee.
14.18 FISCAL YEAR OF THE TRUST
The fiscal year of the Trust will coincide with the Plan Year.
49.
14.19 DISCHARGE OF DUTIES BY FIDUCIARIES
The Trustee and the Employer and any other fiduciary shall discharge their
duties under the Plan and this Trust Agreement solely in :he interests of
Participants and their Beneficiaries in accordance with the requirements of
ERISA.
14.20 AMENDMENT
In accordance with provisions of the Plan, and subject to the limitations set
forth therein, this Trust Agreement may be amended by an instrument in writing
signed by the Employer and the Trustee. No amendment to this Trust Agreement
shall divert any part of the Trust Fund to any purpose other than as provided in
Section 2 hereof.
14.21 PLAN TERMINATION
Upon termination or partial termination of the Plan or complete discontinuance
of contributions thereunder, the Trustee will make distributions to the
Participants or other persons entitled to distributions as the Employer or
Administrator directs in accordance with the provisions of the Plan. In the
absence of such instructions and unless the Plan otherwise provides, the Trustee
will notify the Employer or Administrator of such situation and the Trustee will
be under no duty to make any distributions under the Plan until it receives
written instructions from the Employer or Administrator. Upon the completion of
such distributions, the Trust will terminate, the Trustee will be relieved from
all liability under the Trust, and no Participant or other person will have any
claims thereunder, except as required by applicable law.
14.22 PERMITTED REVERSION OF FUNDS TO EMPLOYER
If it is determined by the Internal Revenue Service that the Plan does not
initially qualify under Section 401 of the Code, all assets then held under the
Plan will be returned by the Trustee, as directed by the Administrator, to the
Employer, but only if the application for determination is made by the time
prescribed by law for filing the Employer's return for the taxable year in which
the Plan was adopted or such later date as may be prescribed by regulations.
Such distribution will be made within one year after the date the initial
qualification is denied. Upon such distribution the Plan will be considered to
be rescinded and to be of no force or effect.
Contributions under Plan are conditioned upon their deductibility under Section
404 of the Code. In the event the deduction of a contribution made by the
Employer is disallowed under Section 404 of the Code, such contribution (to the
extent disallowed) must be returned to the Employer within one year of the
disallowance of the deduction.
Any contribution made by the Employer because of a mistake of fact must be
returned to the Employer within one year of the contribution.
14.23 GOVERNING LAW
This Trust Agreement will be construed, administered and enforced according to
ERISA and, to the extent not preempted thereby, the laws of the Commonwealth of
Massachusetts.
50.
