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EXHIBIT 10.1
FIRST BANKING COMPANY OF SOUTHEAST GEORGIA
PROFIT SHARING PLAN
THIS INDENTURE made on the 29th day of December, 1994, by FIRST BANKING
COMPANY OF SOUTHEAST GEORGIA, a corporation duly organized and existing under
the laws of the State of Georgia (hereinafter called the "Primary Sponsor");
W I T N E S S E T H:
WHEREAS, the Primary Sponsor established the First Banking Company of
Southeast Georgia Uniform Profit Sharing Plan under an indenture dated December
11, 1985 (the "Old Plan"); and
WHEREAS, First Xxxxxxx Bank & Trust Company ("First Xxxxxxx") adopted
the Old Plan by execution of an Adoption Agreement dated December 11, 1985 (the
"First Xxxxxxx Plan"); and
WHEREAS, Metter Banking Company ("Metter") established the Metter
Banking Company Profit Sharing Plan under an amended and restated indenture
effective January 1, 1984 (the "Metter Plan"); and
WHEREAS, the Primary Sponsor, First Xxxxxxx and Metter amended and
restated the Old Plan, the First Xxxxxxx Plan, and the Metter Plan into the
FIRST BANKING COMPANY OF SOUTHEAST GEORGIA PROFIT SHARING PLAN (the "Plan") by
indenture dated December 30, 1988, and further amended and restated the Plan by
indenture dated December 28, 1989; and
WHEREAS, the Plan is intended to be a profit sharing plan within the
meaning of Treasury Regulation Section 1.401-1(b)(1)(ii) and also contains a
cash or deferred arrangement as described in Section 401(k) of the Internal
Revenue Code of 1986; and
WHEREAS, the Primary Sponsor now wishes to amend and restate the Plan
primarily to comply with the provisions of the Tax Reform Act of 1986,
subsequent legislation, and various regulations and rulings issued by government
agencies thereon; and
WHEREAS, the provisions of the Plan, as amended and restated herein,
shall apply only to Plan years beginning after December 31, 1988, and only with
respect to members who perform an Hour of Service (as defined in the Plan) in
Plan years beginning after December 31, 1988, except to the extent the
provisions are required to apply at another date or to any other members to
comply with applicable law;
NOW, THEREFORE, the Primary Sponsor does hereby amend and restate the
Plan in its entirety, effective as of January 1, 1989, except as otherwise
provided herein, to read as follows:
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FIRST BANKING COMPANY OF SOUTHEAST GEORGIA
PROFIT SHARING PLAN
TABLE OF CONTENTS
SECTION 1 DEFINITIONS.....................................................................................1
SECTION 2 ELIGIBILITY....................................................................................11
SECTION 3 CONTRIBUTIONS..................................................................................12
SECTION 4 ALLOCATIONS....................................................................................14
SECTION 5 PLAN LOANS.....................................................................................16
SECTION 6 HARDSHIP DISTRIBUTIONS.........................................................................18
SECTION 7 DEATH BENEFITS.................................................................................20
SECTION 8 PAYMENT OF BENEFITS ON RETIREMENT OR DEATH.....................................................21
SECTION 9 PAYMENT OF BENEFITS ON TERMINATION
OF EMPLOYMENT..................................................................................25
SECTION 10 CONDITIONS OF DISTRIBUTION OF COMPANY STOCK....................................................27
SECTION 11 ADMINISTRATION OF THE PLAN.....................................................................28
SECTION 12 CLAIM REVIEW PROCEDURE.........................................................................31
SECTION 13 LIMITATION OF ASSIGNMENT, PAYMENTS TO LEGALLY
INCOMPETENT DISTRIBUTEE AND UNCLAIMED PAYMENTS.................................................32
SECTION 14 PROHIBITION AGAINST DIVERSION..................................................................33
SECTION 15 LIMITATION OF RIGHTS...........................................................................33
SECTION 16 AMENDMENT TO OR TERMINATION OF THE PLAN
AND THE TRUST..................................................................................34
SECTION 17 ADOPTION OF PLAN BY AFFILIATES.................................................................35
SECTION 18 QUALIFICATION AND RETURN OF CONTRIBUTIONS......................................................36
SECTION 19 INCORPORATION OF SPECIAL LIMITATIONS...........................................................36
APPENDIX A SPECIAL NONDISCRIMINATION RULES ..............................................................A-1
APPENDIX B LIMITATION ON ALLOCATIONS ....................................................................B-1
APPENDIX C TOP-HEAVY PROVISIONS..........................................................................C-1
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SECTION 1
DEFINITIONS
Wherever used herein, the masculine pronoun shall be deemed to include
the feminine, and the singular to include the plural, unless the context clearly
indicates otherwise and the following words and phrases shall, when used herein,
have the meanings set forth below:
1.1 "Account" means the account established and maintained by the
Plan Administrator to reflect the interest of a Member in the Fund. In addition
to any other accounts as the Plan Administrator may establish and maintain, the
Plan Administrator shall establish and maintain separate accounts (each of which
shall be adjusted pursuant to the Plan to reflect income, gains, losses and
other credits or charges attributable thereto) for each Member to be designated
as follows:
(a) "Employee Deferral Account" which shall reflect a
Member's interest in contributions made by a Plan Sponsor under Plan
Section 3.1.
(b) "Matching Account" which shall reflect a Member's
interest in matching contributions made by a Plan Sponsor under Plan
Section 3.2.
(c) "ROA Account" which shall reflect a Member's interest
in contributions made by a Plan Sponsor under Plan Section 3.3.
(d) "Voluntary Contribution Account" which shall reflect
a Member's interest in Voluntary Contributions made by a Member to the
Fund.
(e) "Rollover Account" which shall reflect a Member's
interest in Rollover Amounts.
(f) "Metter Profit Sharing Account" which shall reflect a
Member's interest in his account under the Metter Plan.
The Matching Accounts and ROA Accounts shall each consist of a Company
Stock Subaccount and an Other Investment Subaccount. The Employee Deferral
Accounts, Voluntary Contribution Accounts and Metter Profit Sharing Accounts
shall each consist solely of an Other Investment Subaccount. In addition, the
Plan Administrator shall allocate the interest of a Member in any funds
transferred to the Plan in a trust-to-trust transfer (other than Rollover
Amounts) or pursuant to the merger of another tax-qualified retirement plan with
the Plan among the above accounts as the Plan Administrator determines best
reflects the interest of the Member.
1.2 "Accrued Benefit" means the balance of a Member's Account.
1.3 "Affiliate" means (a) any corporation which is a member of the
same controlled group of corporations (within the meaning of Code Section
414(b)) as is a Plan Sponsor, (b) any other trade or business (whether or not
incorporated) under common control (within the meaning of Code Section 414(c))
with a Plan Sponsor, (c) any other corporation, partnership or other
organization which is a member of an affiliated service group (within the
meaning of Code Section 414(m)) with a Plan Sponsor, and (d) any other entity
required to be aggregated with a Plan Sponsor pursuant to regulations under Code
Section 414(o).
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1.4 "Anniversary Date" means the first day of each Plan Year.
1.5 "Annual Compensation" means the amount paid to an Employee by
a Plan Sponsor and Affiliates during a Plan Year as wages, salaries for
professional services, and other amounts received for personal services actually
rendered (including, but not limited to, commissions paid salesmen, compensation
for services on the basis of percentage of profits, commissions on insurance
premiums, tips and bonuses), to the extent not in excess of the Annual
Compensation Limit. For purposes of the preceding sentence, income from sources
outside the United States otherwise excluded from gross income under Code
Section 911 shall be included in Annual Compensation. Annual Compensation does
not include deferred compensation, stock options, and other amounts which
receive special tax benefits. Notwithstanding the above, Annual Compensation
shall be determined as follows:
(a) in determining with respect to each Plan Sponsor the
amount of contributions under Plan Section 3 made by or on behalf of an
Employee and allocations under Plan Section 4, and for purposes of
applying the provisions of Appendix A hereto for such Plan Years as the
Secretary of the Treasury may allow, Annual Compensation shall only
include amounts received from that Plan Sponsor for the portion of the
Plan Year during which the Employee was a Member;
(b) for purposes of applying the Annual Compensation
Limit, with respect to Plan Section 3 and Appendix A, the rules
contained in Subsection (c) of the Plan Section 1.28 shall apply,
except that in applying such rules, the term "family" shall include
only the spouse of the Member and any lineal descendants of the Member
who have not attained age 19 before the close of the Plan Year;
(c) for all purposes under the Plan except Appendices B
and C hereto, Annual Compensation shall include any amount which would
have been paid during a Plan Year, but was contributed by a Plan
Sponsor on behalf of an Employee pursuant to a salary reduction
agreement which is not includable in the gross income of the Employee
under Section 125, 402(e)(3), or 402(h) of the Code; and
(d) for purposes of applying the annual addition limits
set forth in Appendix B, the term Plan Sponsor as used in Plan Section
1.5 shall mean Plan Sponsor as that term is defined in Section 4 of
Appendix B.
1.6 "Annual Compensation Limit" means (1) $200,000 for
the Plan Year beginning in 1989, which amount may be adjusted in subsequent Plan
Years through the Plan Year beginning in 1993, based on changes in the cost of
living as announced by the Secretary of the Treasury, and (2) $150,000 for the
Plan Year beginning in 1994, which amount may be adjusted in subsequent Plan
Years based on changes in the cost of living as announced by the Secretary of
the Treasury.
1.7 "Beneficiary" means the person or trust that a Member
designated most recently in writing to the Plan Administrator; provided,
however, that if the Member has failed to make a
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designation, no person designated is alive, no trust has been established, or no
successor Beneficiary has been designated who is alive, the term "Beneficiary"
means (a) the Member's spouse or (b) if no spouse is alive, the Member's
surviving children, or (c) if no children are alive, the Member's parent or
parents, or (d) if no parent is alive, the legal representative of the deceased
Member's estate. Notwithstanding the preceding sentence, the spouse of a married
Member shall be his Beneficiary unless that spouse has consented in writing to
the designation by the Member of some other person or trust and the spouse's
consent acknowledges the effect of the designation and is witnessed by a notary
public. A Member may change his designation at any time. However, a Member may
not change his designation without further consent of his spouse under the terms
of the preceding sentence unless the spouse's consent permits designation of
another person or trust without further spousal consent and acknowledges that
the spouse has the right to limit consent to a specific beneficiary and that the
spouse voluntarily relinquishes this right. Notwithstanding the above, the
spouse's consent shall not be required if the Member establishes to the
satisfaction of the Plan Administrator that the spouse cannot be located, if the
Member has a court order indicating that he is legally separated or has been
abandoned (within the meaning of local law) unless a "qualified domestic
relations order" (as defined in Code Section 414(p)) provides otherwise, or if
there are other circumstances as the Secretary of the Treasury prescribes. If
the spouse is legally incompetent to give consent, consent by the spouse's legal
guardian shall be deemed to be consent by the spouse. 1.8 "Board of Directors"
means the Board of Directors of the Primary Sponsor.
1.9 "Break in Service" means the failure of an Employee, in
connection with a termination of employment other than by reason of death or
attainment of a Retirement Date, to complete more than 500 Hours of Service in
any Plan Year.
1.10 "Code" means the Internal Revenue Code of 1986, as amended.
1.11 "Company Stock" means shares of any class of stock issued by
the Primary Sponsor or any Affiliate and constituting Qualifying Employer
Securities within the meaning of ERISA Section 407(d)(5).
1.12 "Company Stock Subaccount" means the subaccount within each
Matching Account and ROA Account invested in Company Stock. A Company Stock
Subaccount shall be expressed in terms of whole shares and any fractional share
or right to a fractional share of Company Stock and shall be adjusted pursuant
to the Plan to reflect any change in the number of shares of Company Stock
attributable to the Company Stock Subaccount.
1.13 "Deferral Amount" means a contribution of a Plan Sponsor on
behalf of a Member pursuant to Plan Section 3.1.
1.14 "Direct Rollover" means a payment by the Plan to the Eligible
Retirement Plan specified by the Distributee.
1.15 "Disability" means a disability of a Member within the meaning
of Code Section 72(m)(7), to the extent that the Member is, or would be,
entitled to disability retirement benefits under the federal Social Security Act
or to the extent that the Member is entitled to recover benefits
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under any long term disability plan or policy maintained by the Plan Sponsor.
The determination of whether or not a Disability exists shall be made by the
Plan Administrator and shall be substantiated by competent medical evidence.
1.16 "Distributee" means an Employee or former Employee. In
addition, the Employee's or former Employee's surviving spouse and the
Employee's or former Employee's spouse or former spouse who is the alternate
payee under a qualified domestic relations order (as defined in Code Section
414(p)), are Distributees with regard to the interest of the spouse or former
spouse.
1.17 "Elective Deferrals" means, with respect to any taxable year
of the Member, the sum of
(a) any Deferral Amounts;
(b) any contributions made by or on behalf of a Member
under any other qualified cash or deferred arrangement as defined in
Code Section 401(k), whether or not maintained by a Plan Sponsor, to
the extent such contributions are not or would not, but for Code
Section 402(g)(1) be included in the Member's gross income for the
taxable year; and
(c) any other contributions made by or on behalf of a
Member pursuant to Code Section 402(g)(3).
1.18 "Eligibility Service" means a twelve-consecutive-month period
during which the Employee completes no less than 1,000 Hours of Service
beginning on the date on which the Employee first performs an Hour of Service
upon his employment or reemployment with a Plan Sponsor, or, in the event an
Employee fails to complete 1,000 Hours of Service in that
twelve-consecutive-month period, any Plan Year thereafter during which an
Employee completes no less than 1,000 Hours of Service, including the Plan Year
which includes the first anniversary of the date the Employee first performed an
Hour of Service upon his employment or reemployment.
1.19 "Eligible Employee" means any Employee of a Plan Sponsor other
than an Employee who is (a) covered by a collective bargaining agreement between
a union and a Plan Sponsor, provided that retirement benefits were the subject
of good faith bargaining, unless the collective bargaining agreement provides
for participation in the Plan, (b) a leased employee within the meaning of Code
Section 414(n)(2), or (c) any other individual who is deemed to be an Employee
of a Plan Sponsor pursuant to regulations under Code Section 414(o).
1.20 "Eligible Retirement Plan" means an individual retirement
account described in Code Section 408(a), an individual retirement annuity
described in Code Section 408(b), an annuity plan described in Code Section
403(a) or a qualified trust described in Code Section 401(a) that accepts the
Distributee's Eligible Rollover Distribution. However, in the case of an
Eligible Rollover Distribution to the surviving spouse, an Eligible Retirement
Plan is an individual retirement account or individual retirement annuity.
1.21 "Eligible Rollover Distribution" means any distribution of all
or any portion of the
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Distributee's Account, except that an Eligible Rollover Distribution does not
include: any distribution that is one of a series of substantially equal
periodic payments (not less frequently than annually) made for the life (or life
expectancy) of the Distributee or the joint lives (or joint life expectancies)
of the Distributee and the Distributee's designated Beneficiary, or for a
specified period of ten years or more; any distribution to the extent such
distribution is required under Code Section 401(a)(9); and the portion of any
distribution that is not includable in gross income (determined without regard
to the exclusion for net unrealized appreciation with respect to employer
securities).
1.22 "Employee" means any person who is employed by a Plan Sponsor
or an Affiliate for purposes of the Federal Insurance Contributions Act, who is
a leased employee within the meaning of Code Section 414(n)(2) with respect to a
Plan Sponsor, or who is deemed to be an employee of a Plan Sponsor pursuant to
regulations under Code Section 414(o).
1.23 "Entry Date" means January 1 and July 1.
1.24 "ERISA" means the Employee Retirement Income Security Act of
1974, as amended.
1.25 "Fair Market Value of Company Stock" means the value of
Company Stock as determined by the Plan Administrator pursuant to Plan Section
11.4(d).
1.26 "Fiduciary" means each Named Fiduciary and any other person
who exercises or has any discretionary authority or control regarding management
or administration of the Plan, any other person who renders investment advice
for a fee or has any authority or responsibility to do so with respect to any
assets of the Plan, or any other person who exercises or has any authority or
control respecting management or disposition of assets of the Plan.
1.27 "Fund" means the amount at any given time of cash and other
property held by the Trustee pursuant to the Plan.
1.28 "Highly Compensated Employee" means each Employee who is
described in Subsection (a), unless the Plan Sponsor makes an election pursuant
to Subsection (b).
(a) (1)The Employee during the Plan Year immediately
preceding the Plan Year in question:
(A) was at any time an owner of more than five
percent (5%) of the outstanding stock of a Plan Sponsor or
Affiliate or more than five percent (5%) of the total combined
voting power of all stock of a Plan Sponsor or Affiliate; or
(B) received Annual Compensation in excess of
$81,720 (for the Plan Year beginning in 1989) which amount
shall be adjusted for changes in the cost of living as
provided in regulations issued by the Secretary of the
Treasury; or
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(C) received Annual Compensation in excess of
$54,480 (for the Plan Year beginning in 1989) which amount
shall be adjusted for changes in the cost of living as
provided in regulations issued by the Secretary of the
Treasury, and who was in the group consisting of the most
highly compensated twenty percent (20%) of the Employees; or
(D) was at any time an officer of the Plan
Sponsor or of any Affiliate whose Annual Compensation was
greater than fifty percent (50%) of the amount in effect under
Code Section 415(b)(1)(A) for the calendar year in which the
Plan Year ends, where the term "officer" means an
administrative executive in regular and continual service to
the Plan Sponsor or Affiliate; provided, however, that in no
event shall the number of officers exceed the lesser of Clause
(i) or (ii) of this Subparagraph (D), where:
(i) equals fifty (50) Employees; and
(ii) equals the greater of (I) three (3)
Employees or (II) ten percent (10%) of the number of
Employees during the Plan Year, with any non-integer
being increased to the next integer.
If for any year no officer of the Plan Sponsor meets the
requirements of this Subparagraph (D), the highest paid
officer of the Plan Sponsor for the Plan Year shall be
considered an officer for purposes of this Subparagraph (D).
(2) The Employee during the Plan Year in question (A) is
described in Subsection (a)(1)(A), or (B) is both (i) described in
Subsection (a)(1)(B), (a)(1)(C), or (a)(1)(D), and (ii) one of the 100
Employees who received the most Annual Compensation during that Plan
Year.
The Plan Administrator may make an election to substitute $54,480 (as
adjusted) for $81,720 (as adjusted) in Subparagraph (B) of Subsection (a)(1)
provided that at all times during the Plan Year the Plan Sponsor and its
Affiliates maintain significant business activities and have Employees in at
least two significantly separate geographic areas and satisfy such other
conditions as the Secretary of the Treasury prescribes.
For purposes of Subparagraphs (C) and (D) of Subsection (a)(1), the
following shall be excluded when determining the number of Employees in the most
highly compensated twenty percent (20%) of the Employees and the number of
officers:
(A) Employees who have not completed six (6)
months of service,
(B) Employees who normally work less than 17-1/2
hours per week,
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(C) Employees who normally work during not more
than six (6) months during any Plan Year,
(D) Employees who have not attained age 21,
(E) Employees who are 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 the Plan Sponsor or its Affiliates,
provided 90% or more of the Employees are covered under
collective bargaining agreements and the Plan only covers
Employees who are not covered under the collective bargaining
agreements.
(b) Notwithstanding the provisions of Subsection (a), the
Primary Sponsor may elect to determine each Highly Compensated Employee
to be each Employee who during the Plan Year in question is described
in Subsection (a) (determined without regard to the head language of
Subsection (a)(1)), pursuant to the provisions of Treas. Reg. Section
1.414(q)-1T, Q&A-14(b).
(c) For purposes of this Section, if any Employee is a
member of the family of a five percent (5%) owner as defined in
Subsection (a)(1) of this Section or of a Highly Compensated Employee
whose Annual Compensation is such that he is among the ten (10) Highly
Compensated Employees receiving the greatest amount of Annual
Compensation during the Plan Year, then (1) the Employee shall not be
considered a separate Employee, and (2) any Annual Compensation paid to
the Employee, and any applicable contribution or benefit on behalf of
the Employee, shall be treated as if it were paid to, or on behalf of,
the five percent (5%) owner or the Employee who is among the ten (10)
Highly Compensated Employees receiving the greatest amount of Annual
Compensation during the Plan Year. For purposes of this Section (b),
the term "family" means with respect to any Employee, the Employee's
spouse and lineal descendants or ascendants and the spouses of lineal
descendants or ascendants.
(d) For purposes of this Section, a former Employee shall
be treated as a Highly Compensated Employee if (1) the former Employee
was a Highly Compensated Employee at the time the former Employee
separated from service with the Plan Sponsor or Affiliate or (2) the
former Employee was a Highly Compensated Employee at any time after the
former Employee attained age 55.
(e) For purposes of this Section, Employees who are
nonresident aliens and who receive no earned income from the Plan
Sponsor or an Affiliate from sources within the United States shall not
be treated as Employees.
(f) For purposes of this Section, Annual Compensation
shall include amounts paid by Affiliates and shall be determined
without regard to the Annual Compensation Limit, as adjusted.
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1.29 "Hour of Service" means:
(a) Each hour for which an Employee is paid, or entitled
to payment, for the performance of duties for a Plan Sponsor or any
Affiliate during the applicable computation period, and such hours
shall be credited to the computation period in which the duties are
performed;
(b) Each hour for which an Employee is paid, or entitled
to payment, by a Plan Sponsor or any Affiliate 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 (including disability), layoff, jury duty, military
duty or leave of absence;
(c) Each hour for which back pay, irrespective of
mitigation of damages, is either awarded or agreed to by a Plan Sponsor
or any Affiliate, and such hours shall be credited to the computation
period or periods to which the award or agreement for back pay pertains
rather than to the computation period in which the award, agreement or
payment is made; provided, that the crediting of Hours of Service for
back pay awarded or agreed to with respect to periods described in
Subsection (b) of this Section shall be subject to the limitations set
forth in Subsection (f);
(d) Solely for purposes of determining whether a Break in
Service has occurred, each hour during any period that the Employee is
absent from work (1) by reason of the pregnancy of the Employee, (2) by
reason of the birth of a child of the Employee, (3) by reason of the
placement of a child with the Employee in connection with the adoption
of the child by the Employee, or (4) for purposes of caring for such
child for a period immediately following its birth or placement. The
hours described in this Subsection (d) shall be credited (A) only in
the computation period in which the absence from work begins, if the
Employee would be prevented from incurring a Break in Service in that
year solely because of that credit, or (B), in any other case, in the
next following computation period. In no event shall an Employee be
credited with more than 501 Hours of Service during any single
continuous period during which he performs no duties for the Plan
Sponsor or Affiliate;
(e) Without duplication of the Hours of Service counted
pursuant to Subsection (d) hereof and solely for such purposes as
required pursuant to the Family and Medical Leave Act of 1993 and the
regulations thereunder (the "Act"), each hour (as determined pursuant
to the Act) for which an Employee is granted leave under the Act (1)
for the birth of a child, (2) for placement with the Employee of a
child for adoption or xxxxxx care, (3) to care for the Employee's
spouse, child or parent with a serious health condition, or (4) for a
serious health condition that makes the Employee unable to perform the
functions of the Employee's job;
(f) The Plan Administrator shall credit Hours of Service
in accordance with the provisions of Section 2530.200b-2(b) and (c) of
the U.S. Department of Labor Regulations or such other federal
regulations as may from time to time be applicable and determine Hours
of
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Service from the employment records of a Plan Sponsor or in any other
manner consistent with regulations promulgated by the Secretary of
Labor, and shall construe any ambiguities in favor of crediting
Employees with Hours of Service. Notwithstanding any other provision of
this Section, in no event shall an Employee be credited with more than
501 Hours of Service during any single continuous period during which
he performs no duties for the Plan Sponsor or Affiliate; and
(g) In the event that a Plan Sponsor or an Affiliate
acquires substantially all of the assets of another corporation or
entity or a controlling interest of the stock of another corporation or
merges with another corporation or entity and is the surviving entity,
then service of an Employee who was employed by the prior corporation
or entity and who is employed by the Plan Sponsor or an Affiliate at
the time of the acquisition or merger shall be counted in the manner
provided, with the consent of the Primary Sponsor, in resolutions
adopted by the Plan Sponsor authorizing the counting of such service.
1.30 "Investment Committee" means a committee which may be
established to direct the Trustee with respect to investments of the Fund.
1.31 "Investment Manager" means a Fiduciary, other than the
Trustee, the Plan Administrator, or a Plan Sponsor, who may be appointed by the
Primary Sponsor:
(a) who has the power to manage, acquire, or dispose of
any assets of the Fund or a portion thereof; and
(b) who (1) is registered as an investment adviser under
the Investment Advisers Act of 1940, (2) is a bank as defined in that
Act, or (3) is an insurance company qualified to perform services
described in Subsection (a) above under the laws of more than one
state; and
(c) who has acknowledged in writing that he is a
Fiduciary with respect to the Plan.
1.32 "Member" means any Employee or former Employee who has become
a participant in the Plan for so long as his vested Accrued Benefit has not been
fully distributed pursuant to the Plan.
1.33 "Named Fiduciary" means only the following:
(a) the Plan Administrator;
(b) the Trustee;
(c) the Investment Committee; and
(d) the Investment Manager.
1.34 "Normal Retirement Age" means the later of (a) age 65 and (b)
the fifth anniversary
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of the date a Member commenced participation in the Plan. For purposes of
determining the fifth anniversary of a Member's commencement of participation,
service under any pension or profit sharing plan of a Plan Sponsor shall be
counted; however, the same service shall not be counted twice.
1.35 "Other Investment Subaccount" means the subaccount within each
Account invested in other than Company Stock. The balance of an Other Investment
Subaccount shall be expressed as a dollar amount and shall be adjusted pursuant
to the Plan to reflect income, gains, losses and other credits or charges
attributable thereto.
1.36 "Plan Administrator" means the organization or person
designated to administer the Plan.
1.37 "Plan Sponsor" means individually the Primary Sponsor, First
Xxxxxxx Bank & Trust Company, Metter Banking Company, and any Affiliate or other
entity which has adopted the Plan and Trust.
1.38 "Plan Year" means the calendar year.
1.39 "Prior Plan" means the Old Plan, the First Xxxxxxx Plan, the
Metter Plan, or any other plan previously adopted by a Plan Sponsor which has
been approved by the Internal Revenue Service under Code Sections 401(a) and
501(a) and which the Plan Sponsor has amended and restated into the Plan.
1.40 "Retirement Date" means the date on which the Member retires
on or after (a) attaining Normal Retirement Age, or (b) becoming subject to a
Disability.
1.41 "Return on Assets" means the ratio of (a) the after-tax net
income of the Plan Sponsors on a consolidated basis excluding extraordinary
items but including the Plan Sponsors' contributions under the Plan to (b) the
Plan Sponsors' average assets during their fiscal years ending within or
coincident with the Plan Year, as determined in accordance with generally
accepted accounting principles.
1.42 "Rollover Amount" means any amount transferred to the Fund by
a Member, which amount qualifies as an eligible rollover distribution under Code
Section 402(c)(4), or for rollover treatment under Code Sections 403(a)(4) or
408(d)(3)(A)(ii) and any regulations issued thereunder.
1.43 "Termination Completion Date" means the last day of the fifth
consecutive Break in Service computation period, determined under the Plan
Section 1.9, in which a Member completes a Break in Service.
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1.44 "Trust" means the trust established under an agreement dated
December 30, 1988, between the Primary Sponsor and the Trustee to hold the Fund
or any successor agreement.
1.45 "Trustee" means the trustee under the Trust.
1.46 "Valuation Date" means the last day of each Plan Year or any
other day which the Plan Administrator declares to be a Valuation Date as
determined to preserve the interest of Members in the Fund.
1.47 "Vesting Service" means each Plan Year during which an
Employee has completed no less than 1,000 Hours of Service. Notwithstanding
anything contained herein to the contrary, Vesting Service shall not include:
(a) In the case of an Employee who for each of five
consecutive Plan Years completes a Break in Service and who is not
reemployed by a Plan Sponsor or an Affiliate on or prior to his
Termination Completion Date, for purposes of determining the vested
portion of his Accrued Benefit derived from Plan Sponsor contributions
which accrued before his Termination Completion Date, all service in
Plan Years after his Termination Completion Date; and
(b) In the case of an Employee who, at the time of his
Termination Completion Date following termination of employment (other
than by reason of attainment of a Retirement Date or death) does not
have any vested right in Plan Sponsor contributions, all service in
Plan Years before the Plan Year in which the first of the five
consecutive Breaks in Service commenced, if the number of consecutive
Plan Years in which the Employee incurred a Break in Service equals or
exceeds five.
1.48 "Voluntary Contribution" means a non-deductible contribution
to the Fund made by the Member.
SECTION 2
ELIGIBILITY
2.1 Each individual who was a participant in a Prior Plan on the
day immediately preceding January 1, 1989 shall be a Member as of January 1,
1989.
2.2 Each individual who was an Eligible Employee on July 1, 1988
and who was still an Eligible Employee on January 1, 1989 shall become a Member
as of January 1, 1989.
2.3 Each former Member who is reemployed by a Plan Sponsor shall
become a Member as of the date of his reemployment as an Eligible Employee.
2.4 Each former Employee who completes his Eligibility Service but
terminates employment with a Plan Sponsor before becoming a Member shall become
a Member as of the latest
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of the date he (a) is reemployed, (b) would have become a Member if he had not
terminated employment, or (c) becomes an Eligible Employee.
2.5 Each other Eligible Employee shall become a Member as of the
Entry Date coinciding with or next following the date he completes his
Eligibility Service.
2.6 Solely for the purpose of contributing a Rollover Amount to
the Plan, an Eligible Employee who has not yet become a Member pursuant to any
other provision of this Section 2 shall become a Member as of the date on which
the Rollover Amount is contributed to the Plan.
SECTION 3
CONTRIBUTIONS
3.1 (a) The Plan Sponsor shall make a contribution to the
Fund on behalf of each Member who is an Eligible Employee and has
elected to defer a portion of Annual Compensation otherwise payable to
him for the Plan Year and to have such portion contributed to the Fund.
The election must be made before the Annual Compensation is payable and
may only be made pursuant to an agreement between the Member and the
Plan Sponsor which shall be in such form and subject to such rules and
limitations as the Plan Administrator may prescribe and shall specify
the amount of what would otherwise be Annual Compensation that the
Member desires to defer and to have contributed to the Fund. The
contribution made by a Plan Sponsor on behalf of a Member under this
Section 3.1 shall be in an amount equal to the amount specified in the
Member's deferral agreement, but not greater than ten percent (10%) of
the Member's Annual Compensation.
(b) Elective Deferrals shall in no event exceed $7,627
(for 1989) in any one taxable year of the Member, which amount shall be
adjusted for changes in the cost of living as provided by the Secretary
of the Treasury. In the event the amount of Elective Deferrals exceeds
$7,627 (for 1989) as adjusted, in any one taxable year then, (1) not
later than the immediately following March 1, the Member may designate
to the Plan the portion of the Member's Deferral Amount which consists
of excess Elective Deferrals, and (2) not later than the immediately
following April 15, the Plan may distribute the amount designated to it
under Paragraph (1) above, as adjusted to reflect income, gain, or loss
attributable to it through the date of the distribution, and reduced by
any "Excess Deferral Amounts," as defined in Appendix A hereto,
previously distributed or recharacterized with respect to the Member
for the Plan Year beginning with or within that taxable year. The
payment of the excess Elective Deferrals, as adjusted and reduced, from
the Plan shall be made to the Member without regard to any other
provision in the Plan. In the event that a Member's Elective Deferrals
exceed $7,627, as adjusted, in any one taxable year under the Plan and
other plans of the Plan Sponsor and its Affiliates, the Member shall be
deemed to have designated for distribution under the Plan the amount of
excess Elective Deferrals, as adjusted and reduced, by taking into
account only Elective Deferral amounts under the Plan and other plans
of the Plan Sponsor and its Affiliates.
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3.2 The Plan Sponsor proposes to make contributions to the Fund
with respect to each Plan Year on behalf of each Member who is an Eligible
Employee in an amount equal to (a) fifty percent (50%) of the amount up to the
first one percent (1%) of Annual Compensation deferred by the Member pursuant to
Plan Section 3.1, (b) one hundred percent (100%) of the amount over one percent
(1%) but not more than two percent (2%) of Annual Compensation deferred by the
Member pursuant to Plan Section 3.1, (c) two hundred percent (200%) of the
amount over two percent (2%) but not more than three percent (3%) of Annual
Compensation deferred by a Member pursuant to Plan Section 3.1, and (d) four
hundred percent (400%) of the amount over three percent (3%) but not more than
four percent (4%) of Annual Compensation deferred by a Member pursuant to Plan
Section 3.1.
3.3 Commencing January 1, 1990, the Plan Sponsors propose to make
an additional contribution to be allocated to the ROA Accounts of Members. The
amount of these contributions for a Plan Year will be based (a) on the prior
year's Return on Assets ("ROA"), with respect to Plan Years beginning before
January 1, 1994, and (b) on the current year's ROA, with respect to Plan Years
commencing on and after January 1, 1994, in accordance with the following
formula:
(a) 1% of the total Annual Compensation of all Members
entitled to allocations under Plan Section 4.1(c) if ROA is equal to or
greater than 0.9% but less than 1.0%;
(b) 2% of the total Annual Compensation of all Members
entitled to allocations under Plan Section 4.1(c) if ROA is equal to or
greater than 1.0% but less than 1.1%;
(c) 3% of the total Annual Compensation of all Members
entitled to allocations under Plan Section 4.1(c) if ROA is equal to or
greater than 1.1% but less than 1.2%;
(d) 4% of the total Annual Compensation of all Members
entitled to allocations under Plan Section 4.1(c) if ROA is equal to or
greater than 1.2% but less than 1.3%;
(e) 5% of the total Annual Compensation of all Members
entitled to allocations under Plan Section 4.1(c) if ROA is equal to or
greater than 1.3% but less than 1.4%;
(f) 6% of the total Annual Compensation of all Members
entitled to allocations under Plan Section 4.1(c) if ROA is equal to or
greater than 1.4% but less than 1.5%;
(g) 7% of the total Annual Compensation of all Members
entitled to allocations under Plan Section 4.1(c) if ROA is equal to or
greater than 1.5% but less than 1.6%;
(h) 8% of the total Annual Compensation of all Members
entitled to allocations under Plan Section 4.1(c) if ROA is equal to or
greater than 1.6% but less than 1.7%;
(i) 9% of the total Annual Compensation of all Members
entitled to allocations under Plan Section 4.1(c) if ROA is equal to or
greater than 1.7% but less 1.8%; and
(j) 10% of the total Annual Compensation of all Members
entitled to allocations
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under Plan Section 4.1(c) if ROA is equal to or greater than
1.8%.
3.4 Forfeitures shall be used to reduce Plan Sponsor contributions
and not to increase benefits.
3.5 Any Member may, with the consent of the Plan Administrator and
subject to such rules and conditions as the Plan Administrator may prescribe,
transfer a Rollover Amount to the Fund.
3.6 Notwithstanding any other provisions of the Plan,
contributions to the Fund may be made only in cash, Company Stock or other
property which is acceptable to the Trustee. In no event will the sum of
contributions under Plan Sections 3.1, 3.2 and 3.3 exceed the deductible limits
under Code Section 404.
SECTION 4
ALLOCATIONS
4.1 (a) As soon as reasonably practicable following the date of
withholding by the Plan Sponsor, if applicable, and receipt by the
Trustee, Plan Sponsor contributions made on behalf of each Member under
Plan Section 3.1, and Rollover Amounts contributed by the Member shall
be allocated to the Employee Deferral Account and Rollover Account,
respectively, of the Member on behalf of whom the contributions were
made.
(b) As of the last day of each Plan Year, Plan Sponsor
contributions made under Plan Section 3.2 shall be allocated to the
Matching Accounts of Members on behalf of whom allocations are made
under Subsection (a) of this Section.
(c) As of the last day of each Plan Year, Plan Sponsor
contributions made under Plan Section 3.3 and forfeitures used to
reduce Plan Sponsor contributions shall be allocated to the ROA Account
of each Member who is employed by a Plan Sponsor on the last day of the
Plan Year, or whose death or Retirement Date occurred during the Plan
Year and who individually or through his Beneficiary did not elect to
have payments commence immediately thereafter, in the proportion that
the Member's Annual Compensation bears to the Annual Compensation of
all Members entitled to an allocation under this Subsection (c) and
Subsection (d) hereof.
(d) As of the last day of each Plan Year, if necessary to
satisfy with respect to the Plan Year, the minimum coverage
requirements prescribed in Code Section 410(b) or the minimum
participation requirements under Code Section 401(a)(26) and
regulations issued thereunder, Plan Sponsor contributions made under
Plan Section 3.3 shall be allocated to the ROA Account of each Member
who completed more than 500 Hours of Service during that Plan Year, but
who terminated employment before the last day of the Plan Year, in the
proportion set forth in Subsection (c) hereof.
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(e) Allocations of contributions shall be based on the
amount of cash contributed for the Plan Year which has not been used to
purchase Company Stock as of the Valuation Date plus the average
purchase price or value upon contribution of Company Stock contributed
for the Plan Year or purchased during the Plan Year with cash
contributed on or before the Valuation Date.
(f) As of the Valuation Date in each Plan Year, any
shares of Company Stock which the Trustee has purchased since the last
Valuation Date with cash or other property of the Fund which was not
contributed for the Plan Year shall be allocated to each Member's
Company Stock Subaccounts in the proportion that the amount to be
invested from each Account in Company Stock as of the date of purchase
bears to the aggregate amount to be invested from all such Accounts in
Company Stock on the date of purchase.
4.2 Except as otherwise provided in the Plan and the Trust, as of
the Valuation Date in each Plan Year, the Trustee shall allocate to each Account
its share of the net income or net loss of the Fund as hereinafter set forth.
(a) Any cash dividends paid with respect to Company Stock
allocated to the Account of a Member as of the record date on which the
cash dividend was declared shall be immediately allocated to the Other
Investment Subaccount of the Account.
(b) Any additional shares of Company Stock which are
issued with respect to any Company Stock held in a Company Stock
Subaccount for any reason, including, but not limited to, stock
dividends, mergers or stock splits, shall be immediately credited to
each Company Stock Subaccount as of the date on which the additional
shares of Company Stock are delivered to the Trustee. The additional
shares of Company Stock shall be credited to each Company Stock
Subaccount based upon the number of shares of Company Stock in each
Company Stock Subaccount as of the record date on which the stock
dividend or other issuance was declared or received, as the case may
be.
(c) The net income or net loss of the Other Investment
Subaccounts shall be determined separately by the Trustee and allocated
as of each Valuation Date as follows:
(1) To the cash income, if any, since the last
Valuation Date, there shall be added or subtracted, as the
case may be, any net increase or decrease, since the last
Valuation Date, in the fair market value of the assets of the
Fund, any gain or loss on the sale or exchange of assets of
the Fund since the last Valuation Date, accrued interest since
the last Valuation Date with respect to any interest-bearing
security, the amount of any dividend which shall have been
declared since the last Valuation Date but not paid on shares
of stock owned by the Fund if the market quotation used in
determining the value of such shares is ex-dividend, and the
amount of any other assets of the Fund determined by the
Trustee to be income since the last Valuation Date.
(2) From the sum thereof there shall be deducted
all charges, expenses,
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and liabilities accrued since the last Valuation Date which
are proper under the provisions of the Plan and Trust and
which in the discretion of the Trustee are properly chargeable
against income for the period.
(3) Except as otherwise provided in the Plan and
the Trust, the net income or net loss so determined shall be
allocated as of the Valuation Date to the Other Investment
Subaccounts in the proportion that the value of the Other
Investment Subaccount of each Member as of the preceding
Valuation Date, increased by one-half of the Elective
Deferrals and Rollover Amounts allocated to that Member's
Other Investment Subaccount since the preceding Valuation Date
and reduced by the full amount of any withdrawals from that
Member's Other Investment Subaccount since that Valuation
Date, bears to the Other Investment Subaccounts of all Members
as of the preceding Valuation Date, as so increased and
reduced.
SECTION 5
PLAN LOANS
5.1 Subject to the provisions of the Plan and the Trust, effective
for Plan Years beginning on and after January 1, 1995, each Member who is an
Employee shall have the right, subject to prior approval by the Plan
Administrator, to borrow from the Fund an amount equal to the lesser of (a) 50%
of the value of the Member's vested Account, or (b) the value of the Member's
Employee Deferral Account. In addition, each "party in interest," as defined in
ERISA Section 3(14), who is (1) a Member but no longer an Employee, (2) the
Beneficiary of a deceased Member, or (3) an alternate payee of a Member pursuant
to the provisions of a "qualified domestic relations order," as defined in Code
Section 414(p), shall also have the right, subject to prior approval by the Plan
Administrator, to borrow from the Fund an amount equal to that described above;
provided, however, that loans to such parties in interest may not discriminate
in favor of Highly Compensated Employees.
5.2 In order to apply for a loan, a borrower must complete and
submit to the Plan Administrator documents provided by the Plan Administrator
for this purpose.
5.3 Loans shall be available to all eligible borrowers on a
reasonably equivalent basis which may take into account the borrower's
creditworthiness, ability to repay, and ability to provide adequate security.
Loans shall not be made available to Highly Compensated Employees, officers or
shareholders of a Plan Sponsor in an amount greater than the amount made
available to other borrowers. This provision shall be deemed to be satisfied if
all borrowers have the right to borrow the same percentage of their interest in
the Member's vested Accrued Benefit, notwithstanding that the dollar amount of
such loans may differ as a result of differing values of Members' vested Accrued
Benefits.
5.4 Each loan shall bear a "reasonable rate of interest" and
provide that the loan be amortized in substantially level payments, made no less
frequently than quarterly, over a specified period of time. A "reasonable rate
of interest" shall be that rate that provides the Plan with a return
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commensurate with the interest rates charged by persons in the business of
lending money for loans which would be made under similar circumstances.
5.5 Each loan shall be adequately secured, with the security for
the outstanding balance of all loans to the borrower to consist of one-half
(1/2) of the borrower's interest in the Member's vested Account, or such other
security as the Plan Administrator deems acceptable. No portion of the Member's
Employee Deferral Account shall be used as security for any loan hereunder
unless and until such time as the loan amount exceeds the value of the
borrower's interest in the Member's vested Account in all other Accounts.
5.6 Each loan, when added to the outstanding balance of all other
loans to the borrower from all retirement plans of the Plan Sponsor and its
Affiliates which are qualified under Section 401 of the Code, shall not exceed
the lesser of:
(a) $50,000, reduced by the excess, if any, of
(1) the highest outstanding balance of loans
made to the borrower from all retirement plans qualified under
Code Section 401 of the Plan Sponsor and its Affiliates during
the one (1) year period immediately preceding the day prior to
the date on which such loan was made, over
(2) the outstanding balance of loans made to the
borrower from all retirement plans qualified under Code
Section 401 of the Plan Sponsor and its Affiliates on the date
on which such loan was made, or
(b) one-half (1/2) of the value of the borrower's
interest in the vested Account attributable to the Member's Account.
For purposes of this Section, the value of the vested Account attributable to a
Member's Account shall be established as of the latest preceding Valuation Date,
or any later date on which an available valuation was made, and shall be
adjusted for any distributions or contributions made through the date of the
origination of the loan.
5.7 Each loan, by its terms, shall be repaid within five (5)
years, except that any loan which is used to acquire any dwelling unit which
within a reasonable time is to be used (determined at the time the loan is made)
as the principal residence of the borrower may, by its terms, be repaid within a
longer period of time.
5.8 Each loan shall be made in an amount of no less than $1,000.
5.9 A borrower is permitted to have only one loan existing under
this Plan at any one time.
5.10 The entire unpaid principal sum and accrued interest shall, at
the option of the Plan Administrator, become due and payable if (a) a borrower
fails to make any loan payment when due,
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(b) a borrower ceases to be a "party in interest", as defined in ERISA Section
3(14), (c) the vested Account held as security under the Plan for the borrower
will, as a result of an impending distribution or withdrawal, be reduced to an
amount less than the amount of all unpaid principal and accrued interest then
outstanding under the loan, or (d) a borrower makes any untrue representations
or warranties in connection with the obtaining of the loan. In that event, the
Plan Administrator may take such steps as it deems necessary to preserve the
assets of the Plan, including, but not limited to, the following: (1) direct the
Trustee to deduct the unpaid principal sum, accrued interest, and any other
applicable charge under the note evidencing the loan from any benefits that may
become payable out of the Plan to the borrower, (2) direct the Plan Sponsor to
deduct and transfer to the Trustee the unpaid principal balance, accrued
interest, and any other applicable charge under the note evidencing the loan
from any amounts owed by the Plan Sponsor to the borrower, or (3) liquidate the
security given by the borrower, other than amounts attributable to a Member's
Employee Deferral Account, and deduct from the proceeds the unpaid principal
balance, accrued interest, and any other applicable charge under the note
evidencing the loan. If any part of the indebtedness under the note evidencing
the loan is collected by law or through an attorney, the borrower shall be
liable for attorneys' fees in an amount equal to ten percent of the amount then
due and all costs of collection.
5.11 Each loan shall be made only in accordance with regulations
and rulings of the Internal Revenue Service and the Department of Labor. The
Plan Administrator shall be authorized to administer the loan program of this
Section and shall act in his sole discretion to ascertain whether the
requirements of such regulations and rulings and this Section have been met.
SECTION 6
HARDSHIP DISTRIBUTIONS
6.1 The Trustee shall, upon the direction of the Plan
Administrator, distribute all or a portion of a Member's Employee Deferral
Account or his Voluntary Contribution Account prior to the time such accounts
are otherwise distributable in accordance with the other provisions of the Plan;
provided, however, that any such distribution shall be made only if the Member
is an Employee and demonstrates that he is suffering from "hardship" as
determined herein. That portion of a Member's Employee Deferral Account which
shall be available for a distribution under this Section shall be that portion
consisting of Deferral Amounts (but not earnings thereon) less the unpaid
principal sum of any outstanding loan made to the Participant pursuant to Plan
Section 5. For purposes of this Section, a distribution will be deemed to be an
account of hardship if the distribution is on account of:
(a) (1) medical expenses described in Section 213(d)
of the Code incurred by the Member, his spouse, or any
dependents of the Member (as defined in Section 152 of the
Code) or necessary for these persons to obtain medical care
described in Section 213(d) of the Code;
(2) purchase (excluding mortgage payments) of a
principal residence for the Member;
(3) payment of tuition and related educational
fees for the next twelve
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months of post-secondary education for the Member, his spouse,
children, or dependents;
(4) the need to prevent the eviction of the
Member from his principal residence or foreclosure on the
mortgage of the Member's principal residence; or
(5) any other contingency determined by the
Internal Revenue Service to constitute an "immediate and heavy
financial need" within the meaning of Regulations Section
1.401(k)-1(d).
6.2 In addition to the requirements set forth in Plan Section 6.1,
any distribution pursuant to Plan Section 6.1 shall not be in excess of the
amount necessary to satisfy the need determined under Section 6.1 and shall also
be subject to the requirements of Subsection (a) or (b) of this Section.
(a) (1) the Member shall first obtain all distributions,
other than hardship distributions, and all nontaxable loans
currently available under all plans maintained by the Plan
Sponsor;
(2) the Plan Sponsor shall not permit Elective
Deferrals or after-tax employee contributions to be made to
the Plan or any other plan maintained by the Plan Sponsor, for
a period of twelve (12) months after the Member receives the
distribution pursuant to this Section; and
(3) the Plan Sponsor shall not permit Elective
Deferrals to be made to the Plan or any other plan maintained
by the Plan Sponsor for the Member's taxable year immediately
following the taxable year of the hardship distribution in
excess of the limit under Plan Section 3.1(b) for the taxable
year, less the amount of the Elective Deferrals made to the
Plan or any other plan maintained by the Plan Sponsor for the
taxable year in which the distribution under this Section
occurs.
(b) (1) The Member first obtains all other distributions,
other than hardship distributions, and all nontaxable loans
under all plans maintained by the Plan Sponsor; and
(2) The Plan Administrator determines that it
can reasonably rely on the Member's certification by execution
of a form provided by the Plan Administrator that the need
determined under Plan Section 6.1 cannot be relieved --
(A) through reimbursement or
compensation by insurance or otherwise,
(B) by reasonable liquidation of the
assets of the Member, his spouse and minor children,
to the extent that the liquidation would not itself
cause an immediate and heavy financial need and to
the extent that the assets
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of the spouse and minor children are reasonably
available to the Member,
(C) by cessation of Elective Deferrals,
or
(D) by other distributions or
nontaxable (at the time of the distribution) loans
from plans maintained by the Plan Sponsor or any
other employer, or by borrowing from commercial
sources on reasonable commercial terms.
Such distribution shall be made only in accordance with such rules, policies,
procedures, restrictions, and conditions as the Plan Administrator may from time
to time adopt. Any determination of the existence of hardship and the amount to
be distributed on account thereof shall be made by the Plan Administrator (or
such other person as may be required to make such decisions) in accordance with
the foregoing rules as applied in a uniform and nondiscriminatory manner. A
distribution under this Section shall be made in a lump sum to the Member and
shall be subject to the Eligible Rollover Distribution requirements set forth in
Plan Section 8.8 to the extent required by applicable law.
SECTION 7
DEATH BENEFITS
7.1 Upon the death of a Member who is an Employee at the time of
his death, his Beneficiary shall be entitled to the full value of his Accrued
Benefit.
7.2 Upon the death of a Member who is not an Employee at the time
of his death, prior to the distribution of his vested Accrued Benefit, his
Beneficiary shall be entitled to his vested Accrued Benefit.
7.3 If, subsequent to the death of a Member, the Member's
Beneficiary dies while entitled to receive benefits under the Plan, the
successor Beneficiary, if any, or the Beneficiary listed under Subsection (a),
(b) or (c) of Plan Section 1.7 shall generally be entitled to receive benefits
under the Plan. However, if the deceased Beneficiary was the Member's spouse at
the time of the Member's death, or if no successor Beneficiary shall have been
designated by the Member and be alive and no Beneficiary listed under Subsection
(a), (b) or (c) of Plan Section 1.7 shall be alive, the Member's unpaid vested
Accrued Benefit shall be paid to the personal representative of the deceased
Beneficiary's estate.
7.4 Any benefit payable under this Section 7 shall be paid in
accordance with and subject to the provisions of Plan Section 8 or Section 9,
whichever is applicable, after receipt by the Trustee from the Plan
Administrator of due notice of the death of the Member.
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SECTION 8
PAYMENT OF BENEFITS ON RETIREMENT OR DEATH
8.1 The Accrued Benefit of a Member who has attained his
Retirement Date or has attained Normal Retirement Age or died while an Employee
shall be fully vested and nonforfeitable. As of a Member's Retirement Date or
death while an Employee he or his Beneficiary shall be entitled to his Accrued
Benefit to be paid in accordance with this Section 8.
8.2 (a) The Accrued Benefit of a Member which is to be paid under
this Section 8 shall be determined as of the Valuation Date coinciding
with or next following the Member's Retirement Date or death and shall
be equal to (1) the value of all of the Other Investment Subaccounts of
his Account determined as of such Valuation Date plus (2) the number of
shares of Company Stock in the Company Stock Subaccounts of his
Account, determined as of that Valuation Date. No Plan Sponsor
contributions shall be allocated to the Account of the Member after
that Valuation Date. Payments to a Member, or to the Beneficiary of a
deceased Member, shall commence no later than sixty (60) days after the
end of the Plan Year in which Retirement Date or death of the Member
occurs. A Member or the Beneficiary of a deceased Member may elect by a
written notice to the Plan Administrator to have payments commence
immediately after the Retirement Date or death of a Member, in which
event, the Accrued Benefit of the Member shall be determined as of the
Valuation Date next preceding the Member's Retirement Date or death and
shall be equal to (i) the value of all the Other Investment Subaccounts
of his Account determined as of that Valuation Date reduced by any
amount withdrawn from the Other Investment Subaccounts which was used
to purchase Company Stock since that Valuation Date, plus (ii) the
number of shares of Company Stock in the Company Stock Subaccounts of
his Account determined as of that Valuation Date increased by the
number of shares of Company Stock purchased with assets from his Other
Investment Subaccounts since that Valuation Date, plus (iii)
contributions under Plan Section 3.1 and Rollover Amounts transferred
to the Fund for the Member since that Valuation Date.
(b) Notwithstanding the foregoing, if the amount of the
payment required to commence on a date cannot be ascertained by that
date, payment shall commence retroactively to that date and shall
commence no later than sixty (60) days after the earliest date on which
the amount of payment can be ascertained under the Plan.
8.3 (a) The payment of a Member's Accrued Benefit shall be in the
form of one lump sum, except that a Member whose Accrued Benefit
exceeds $3,500 may elect to have his Accrued Benefit, to the extent
consisting of his Metter Profit Sharing Account, distributed pursuant
to Subsection (b) of this Section. Whole shares of Company Stock in the
Company Stock Subaccount of a Member's Account shall be distributed to
the Member in kind, the value of the Other Investment Subaccount of a
Member's Account shall be paid in cash, and the value of any fractional
share or right to a fractional share in the Member's Company Stock
Subaccount shall be paid in cash to the extent that cash is available
for distribution. If cash is not available, then a fractional share
shall be distributed in kind.
(b) If a Member's Accrued Benefit exceeds $3,500, he may
elect to have his Accrued Benefit, to the extent consisting of his
Metter Profit Sharing Account, paid in
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substantially equal monthly installments over a specified
period which shall not exceed:
(1) when the installments are first payable to a
Member,
(A) the Member's life expectancy, or
(B) the joint life and last survivor
expectancy of the Member and the Member's designated
Beneficiary;
(2) when the installments are first payable to a
designated Beneficiary, the life expectancy of the Member's
designated Beneficiary;
(3) when the installments are first payable to a
Beneficiary other than a designated Beneficiary, five (5)
years; and
(4) when the installments are first paid to a
Member who dies before all installments have been paid, the
period remaining at the Member's death.
8.4 In order to distribute the value of any fractional share or
right to a fractional share in a Member's Company Stock Subaccount, the Trustee
may exchange any fractional share or right to a fractional share for cash in the
Other Investment Subaccounts of all of the Matching Accounts and ROA Accounts to
the extent that the required amount of cash is available and shall immediately
allocate the fractional share or right to a fractional share to the Company
Stock Subaccounts of all such Accounts. The fractional share or right to a
fractional share shall be treated as having been purchased by the Trustee on the
date of such exchange.
8.5 Shares of Company Stock distributed pursuant to this Section 8
shall be subject to the conditions and restrictions described in Plan Section 9.
8.6 Notwithstanding any provision of the Plan to the contrary, if
a Member's vested Accrued Benefit exceeds $3,500, it shall not be distributed
before the Member's Normal Retirement Age or death without the consent of the
Member.
8.7 Notwithstanding any other provisions of the Plan,
(a) Prior to the death of a Member, all retirement
payments hereunder shall --
(1) be distributed to the Member not later than
the required beginning date (as defined below) or,
(2) be distributed, commencing not later than
the required beginning date (as defined below)--
(A) in accordance with regulations
prescribed by the Secretary of the Treasury, over the
life of the Member
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or over the lives of the Member and his designated
individual Beneficiary, if any, or
(B) in accordance with regulations
prescribed by the Secretary of the Treasury, over a
period not extending beyond the life expectancy of
the Member or the joint life and last survivor
expectancy of the Member and his designated
individual Beneficiary, if any.
(b) (1) If --
(A) the distribution of a Member's
retirement payments have begun in accordance with
Subsection (a)(2) of this Section, and
(B) the Member dies before his entire
vested Accrued Benefit has been distributed to him,
then the remaining portion of his vested Accrued Benefit shall
be distributed at least as rapidly as under the method of
distribution being used under Subsection (a)(2) of this
Section as of the date of his death.
(2) If a Member dies before the commencement of
retirement payments hereunder, the entire interest of the
Member shall be distributed within five (5) years after his
death.
(3) If --
(A) any portion of a Member's vested
Accrued Benefit is payable to or for the benefit of
the Member's designated individual Beneficiary, if
any,
(B) that portion is to be distributed,
in accordance with regulations prescribed by the
Secretary of the Treasury, over the life of the
designated individual Beneficiary or over a period
not extending beyond the life expectancy of the
designated individual Beneficiary, and
(C) the distributions begin not later
than one (1) year after the date of the Member's
death or such later date as the Secretary of the
Treasury may by regulations prescribe,
then, for purposes of Paragraph (2) of this Subsection (b),
the portion referred to in Subparagraph (A) of this Paragraph
(3) shall be treated as distributed on the date on which the
distributions to the designated individual Beneficiary begin.
(4) If the designated individual Beneficiary
referred to in Paragraph (3)(A) of this Subsection (b) is the
surviving spouse of the Member, then --
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(A) the date on which the distributions
are required to begin under Paragraph (3)(C) of this
Subsection (b) shall not be earlier than the date on
which the Member would have attained age 70-1/2, and
(B) if the surviving spouse dies before
the distributions to such spouse begin, this
Subsection (b) shall be applied as if the surviving
spouse were the Member.
(c) For purposes of this Section, the term "required
beginning date" means April 1 of the calendar year following the
calendar year in which the Member attains age 70-1/2. Notwithstanding
the foregoing, in the case of a Member who is not described in Section
1(b)(3) of Appendix C hereto and who has attained age 70-1/2 before
January 1, 1988, the term "required beginning date" means April 1 of
the calendar year following the calendar year in which the Member
retires or otherwise terminates employment.
(d) Distributions will be made in accordance with the
regulations under Code Section 401(a)(9), including the minimum
distribution incidental benefit requirement of Treas. Reg. Section
1.401(a)(9)-2.
8.8 Notwithstanding any provisions of the Plan to the contrary
that would otherwise limit a Distributee's election under this Section 8,
effective January 1, 1993, a Distributee may elect, at the time and in the
manner prescribed by the Plan Administrator, to have any portion of a
distribution pursuant to this Section which is an Eligible Rollover Distribution
paid directly to an Eligible Retirement Plan specified by the Distributee in a
Direct Rollover so long as all Eligible Rollover Distributions to a Distributee
for a calendar year total or are expected to total at least $200 and, in the
case of a Distributee who elects to directly receive a portion of an Eligible
Rollover Distribution and directly roll the balance over to an Eligible
Retirement Plan, the portion that is to be directly rolled over totals at least
$500. If the Eligible Rollover Distribution is one to which Code Sections
401(a)(11) and 417 do not apply, such Eligible Rollover Distribution may
commence less than 30 days after the notice required under Treasury Regulations
Section 1.411(a)-11(c) 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
(b) the Distributee, after receiving the notice,
affirmatively elects a distribution.
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SECTION 9
PAYMENT OF BENEFITS ON TERMINATION OF EMPLOYMENT
9.1 Transfer of a Member from one Plan Sponsor to another Plan
Sponsor or to an Affiliate shall not be deemed for any purpose under the Plan to
be a termination of employment of the Member.
9.2 In the event of the termination of employment of a Member for
reasons other than death or attainment of a Retirement Date, the Member's
Accrued Benefit shall be determined as of the Valuation Date coinciding with or
immediately following the Member's termination of employment and shall be equal
to (a) the value of his Other Investment Subaccounts determined as of that
Valuation Date plus (b) the number of shares of Company Stock in his Company
Stock Subaccounts determined as of that Valuation Date. No further Plan Sponsor
contributions or forfeitures shall be allocated to the Member's Account after
that Valuation Date, but until the Valuation Date immediately preceding the date
it is paid, his Account shall be credited with its pro rata share of any income,
gains, and losses attributable thereto and his Company Stock Subaccounts shall
be credited with their pro rata share of any stock dividends, mergers or stock
splits attributable thereto.
9.3 That portion of a Member's Accrued Benefit in which he is
vested shall be:
(a) his Employee Deferral Account, Matching Account,
Voluntary Contribution Account, Rollover Account, and Metter Profit
Sharing Account, which shall be fully vested and nonforfeitable at all
times; and
(b) that portion of the value of the Other Investment
Subaccounts of his ROA Account and the number of shares of Company
Stock in the Company Stock Subaccount of his ROA Account computed
according to the following vesting schedule taking into account any
Vesting Service subsequent to such Valuation Date until the date of his
termination of employment:
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Full Years of Percentage
Vesting Service Vested
--------------- ------
Less than 2 0%
2 20%
3 40%
4 60%
5 80%
6 100%
9.4 The Member shall be entitled to payment in the manner provided
in Plan Section 8.3. Payment shall be made as soon as administratively feasible
after the Member completes his first Break in Service; provided, however,
effective for terminations of employment occurring on and after January 1, 1994,
payment shall be made as soon as administratively feasible after the Valuation
Date coinciding with or next following the Member's termination of employment.
Notwithstanding the preceding, if the Member's vested Accrued Benefit exceeds
$3,500 it will not be distributed before the Member's Normal Retirement Age or
death without the Member's consent. In no event shall payment be made later than
sixty (60) days after the end of the Plan Year in which the Normal Retirement
Age of the Member occurs. Payment shall be subject to the minimum distribution
requirements and Eligible Rollover Distribution requirements set forth in Plan
Section 8.
9.5 In order to distribute the value of any fractional share or
right to a fractional share in the Company Stock Subaccount of the Member's
Account, the Trustee may exchange any such fractional share or right to a
fractional share for cash in the Other Investment Subaccounts of all of the
Matching Accounts and ROA Accounts to the extent that the required amount of
cash is available, and shall immediately allocate such fractional share or right
to a fractional share to the Company Stock Subaccounts of all such Accounts. The
fractional share or right to a fractional share shall be treated as having been
purchased by the Trustee on the date of the exchange.
9.6 (a) If any portion of a Member's vested Account derived from
Plan Sponsor contributions is paid prior to his Termination Completion
Date, a portion of his Account equal to his total non-vested Account
derived from Plan Sponsor contributions multiplied by a fraction, the
numerator of which is the amount of the distribution attributable to
Plan Sponsor contributions and the denominator of which is the total
vested Account attributable to Plan Sponsor contributions, shall be
immediately forfeited. The amount forfeited shall not exceed the
Member's nonvested Account. Upon the Termination of Employment of a
Member who is not vested in any part of his Account, the Member shall
be deemed to have received a distribution and his Account shall be
immediately forfeited.
(b) If the Member is reemployed by a Plan Sponsor or an
Affiliate prior to his Termination Completion Date and (1) if the
Member's Account was partially vested and the Member repays to the Fund
no later than the fifth anniversary of the Member's reemployment by the
Plan Sponsor or an Affiliate all of that portion of his vested Account
which was paid to him or (2) if the Member's Account was not vested
upon his termination
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of employment, then any portion of his Account which was not forfeited
shall be restored effective on the Valuation Date coinciding with or
next following the repayment or the Member's reemployment,
respectively. The restoration on any Valuation Date of the forfeited
portion of the Account of a Member pursuant to the preceding sentence
shall be made first from forfeitures available, and secondly from net
income calculated as of that Valuation Date, to the extent available,
and secondly from net income calculated as of that Valuation Date, if
any. Only after restorations have been made shall the remaining net
income be available for allocation under Plan Section 4.
(c) If a Member who is partially vested in his Account
does not receive, prior to his Termination Completion Date, a
distribution of any portion of his vested Account, then no forfeiture
of that Member's nonvested portion of his Account shall occur until the
Member's Termination Completion Date.
9.7 In the event that a Plan amendment directly or indirectly
changes the vesting schedule, the vesting percentage for each Member in his
Accrued Benefit accumulated to the date when the amendment is adopted shall not
be reduced as a result of the amendment. In addition, any Member with at least
three (3) years of Vesting Service may irrevocably elect to remain under the
pre-amendment vesting schedule with respect to all of his benefits accrued both
before and after the amendment.
9.8 Shares of Company Stock distributed from the Fund pursuant to
this Section 9 shall be subject to the conditions and restrictions described in
Plan Section 10.
9.9 If a Member has a termination of employment and is
subsequently reemployed by a Plan Sponsor or an Affiliate prior to receiving a
distribution of his Accrued Benefit under the Plan, such Member shall not be
entitled to a distribution under this Section while he is an Employee.
SECTION 10
CONDITIONS OF DISTRIBUTION OF COMPANY STOCK
10.1 To the extent appropriate, each share certificate for Company
Stock distributed from the Fund pursuant to the Plan shall be clearly marked
"RESTRICTED" on its face and, to the extent appropriate at the time, each
certificate shall bear on its reverse side legends to the following effect:
(a) That the securities evidenced by the certificate were
issued without registration under the federal Securities Act of 1933
(the "1933 Act") or under the applicable laws of any state or states
(collectively referred to as the "State Acts"), in reliance upon
certain exemptive provisions of the 1933 Act or any applicable State
Acts; and
(b) That the securities cannot be sold or transferred
unless, in the opinion of counsel reasonably acceptable to the Primary
Sponsor any such sale or transfer would be:
(1) pursuant to an effective registration
statement under the 1933 Act or pursuant to an exemption from
such registration; and
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(2) a transaction which is exempt under any
applicable State Acts or pursuant to an effective registration
statement under or in a transaction which is otherwise in
compliance with such State Acts.
10.2 If necessary to comply with the 1933 Act or any applicable
State Acts, shares of Company Stock distributable under the Plan must be
acquired for investment and not with a view to the public distribution thereof.
In furtherance thereof, as a condition of receiving a distribution of whole
shares of Company Stock under the Plan, the distributee may be required to
execute an investment letter and any other documents that in the opinion of
counsel reasonably acceptable to the Primary Sponsor, as issuer, are necessary
to comply with the 1933 Act or any applicable State Acts or any other applicable
laws regulating the issuance or transfer of securities.
10.3 A Member shall have the option to require the Primary Sponsor
or its designee to purchase any shares of Company Stock which have been
distributed to the Member from the Plan (the "Put"). The Put shall be
exercisable at any time following the distribution by giving written notice to
the Primary Sponsor which shall specify the number of shares of Company Stock
which the Member intends to sell to the Primary Sponsor or its designee. The
purchase price for the shares of Company Stock pursuant to the Put shall be an
amount equal to the Fair Market Value of Company Stock, determined as of the
date of the closing. The time and date of the closing shall be no later than
sixty (60) days from the date of the notice of the Put and shall be held at the
principal office of the Primary Sponsor.
The Primary Sponsor or its designee shall pay the purchase price of
the Company Stock to the Member, to the extent permitted by state law, as
follows:
(a) all in cash at the closing, if the purchase price is
$50,000 or less, or
(b) if the purchase price exceeds $50,000 by means of
delivery of a promissory note in a principal amount equal to the
purchase price, payable in installments over a period not greater than
ten (10) years from the date of purchase. The period of time over which
installments shall be paid shall be determined, within the limitations
set forth above in this Subsection (b), solely in the discretion of the
Primary Sponsor, or its designee, which shall also have sole discretion
to pay all or any part of the purchase price in cash in lieu of by
delivery of a promissory note.
SECTION 11
ADMINISTRATION OF THE PLAN
11.1 Trust Agreement. The Primary Sponsor shall establish a Trust
with the Trustee designated by the Board of Directors for the management of the
Fund, which Trust shall form a part of the Plan and is incorporated herein by
reference.
11.2 Operation of the Plan Administrator. The Primary Sponsor shall
appoint a Plan Administrator. If an organization is appointed to serve as the
Plan Administrator, then the Plan Administrator may designate in writing a
person who may act on behalf of the Plan Administrator.
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The Primary Sponsor shall have the right to remove the Plan Administrator at any
time by notice in writing. The Plan Administrator may resign at any time by
written notice of resignation to the Trustee and the Primary Sponsor. Upon
removal or resignation, or in the event of the dissolution of the Plan
Administrator, the Primary Sponsor shall appoint a successor.
11.3 Fiduciary Responsibility.
(a) The Plan Administrator, as a Named Fiduciary, may
allocate its fiduciary responsibilities among Fiduciaries other than
the Trustee, designated in writing by the Plan Administrator and may
designate in writing other persons (other than the Trustee) to carry
out its fiduciary responsibilities under the Plan. The Plan
Administrator may at any time and from time to time remove any such
person designated to carry out its fiduciary responsibilities under the
Plan by notice in writing to such person.
(b) The Plan Administrator and each other Fiduciary may
employ persons to perform services and to render advice with regard to
any of the Fiduciary's responsibilities under the Plan. Charges for all
such services performed and advice rendered may be directly paid by
each Plan Sponsor but until paid shall constitute a charge against the
Fund.
(c) Each Plan Sponsor shall indemnify and hold harmless
each person constituting the Plan Administrator or the Investment
Committee, if any, from and against any and all claims, losses, costs,
expenses (including, without limitation, attorney's fees and court
costs), damages, actions or causes of action arising from, on account
of or in connection with the performance by such person of his duties
in such capacity, other than such of the foregoing arising from, on
account of or in connection with the willful neglect or willful
misconduct of such person so acting.
(d) The purpose of the Plan is to invest primarily in
Company Stock if and to the extent shares are available. The Trustee
shall have the authority to invest up to one hundred (100%) of the
assets of the Fund in Company Stock.
11.4 Duties of the Plan Administrator.
(a) The Plan Administrator shall advise the Trustee with
respect to all payments under the terms of the Plan and shall direct
the Trustee in writing to make such payments from the Fund; provided,
however, in no event shall the Trustee be required to make such
payments if the Trustee has actual knowledge that such payments are
contrary to the terms of the Plan and the Trust.
(b) The Plan Administrator shall from time to time
establish rules, not contrary to the provisions of the Plan and the
Trust, for the administration of the Plan and the transaction of its
business. All elections and designations under the Plan by a
Participant or Beneficiary shall be made on forms prescribed by the
Plan Administrator. The Plan Administrator shall have discretionary
authority to construe the terms of the Plan and shall determine all
questions arising in the administration, interpretation and application
of the Plan, including, but not limited to, those concerning
eligibility for benefits and it shall not
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act so as to discriminate in favor of any person. All determinations of
the Plan Administrator shall be conclusive and binding on all
Employees, Members, Beneficiaries and Fiduciaries, subject to the
provisions of the Plan and the Trust and subject to applicable law.
(c) The Plan Administrator shall furnish Members and
Beneficiaries with all disclosures now or hereafter required by ERISA
or the Code. The Plan Administrator shall file, as required, the
various reports and disclosures concerning the Plan and its operations
as required by ERISA and by the Code, and shall be solely responsible
for establishing and maintaining all records of the Plan and the Trust.
(d) Effective January 1, 1994, the Plan Administrator
shall value shares of Company Stock on the following basis:
(1) The Plan Administrator shall determine the
value of shares of Company Stock held in the Fund on the basis
of a good faith determination of value based upon all relevant
factors for determining fair market value and shall consider,
where applicable, among other factors: prices bid, asked, or
paid for Company Stock listed on any nationally recognized
securities exchange or quoted through the National Market
System of the National Association of Securities Dealers, Inc.
Automatic Quotation System; the existence of restrictions upon
the sale of shares of Company Stock; the existence of any
right in Members and Beneficiaries to require the Plan Sponsor
to purchase shares of Company Stock distributed from the Plan
to such Members and Beneficiaries at fair market value; the
existence and extent of a private market for shares of Company
Stock; the price at which shares of Company Stock were
acquired; the estimated period of time during which shares of
Company Stock would not be freely marketable; the currently
available returns on comparable securities; the financial
condition and prospects of the Primary Sponsor; the existence
of merger proposals or tender offers affecting the Primary
Sponsor. To accomplish the foregoing valuation of shares of
Company Stock held in the Fund, the Plan Administrator may
employ an appraiser to make an annual appraisal of the shares
of Company Stock as of each Valuation Date. If, upon
investigation, the Plan Administrator makes a good faith
determination that such appraiser is experienced in the
valuation of shares of stock of companies similar to the
Primary Sponsor, that such appraiser utilizes acceptable
methods and that such appraiser has an excellent reputation
within the appraisal industry, the Plan Administrator may give
great weight to such appraiser's report and may make a good
faith determination that such appraiser's report of the value
of shares of Company Stock is a determination of the fair
market value of such shares of Company Stock.
(2) In the event of a purchase or sale of shares
of Company Stock by the Trustee as of a date other than as of
the date of an appraisal as described above, the Plan
Administrator shall value shares of Company Stock as of the
date of such transaction on the basis of a good faith
determination of value, based upon all relevant factors to be
used for determining the fair market value of securities,
including those above.
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(e) The statement of specific duties for a Plan
Administrator in this Section is not in derogation of any other duties
which a Plan Administrator has under the provisions of the Plan or the
Trust or under applicable law.
11.5 Investment Manager. The Primary Sponsor may, by action in
writing certified by notice to the Trustee, appoint an Investment Manager. Any
Investment Manager may be removed in the same manner in which appointed, and in
the event of any removal, the Investment Manager shall, as soon as possible, but
in no event more than thirty (30) days after notice of removal, turn over all
assets managed by it to the Trustee or to any successor Investment Manager
appointed, and shall make a full accounting to the Primary Sponsor with respect
to all assets managed by it since its appointment as an Investment Manager.
11.6 Investment Committee. The Primary Sponsor may, by action in
writing certified by notice to the Trustee, appoint an Investment Committee. The
Primary Sponsor shall have the right to remove any person on the Investment
Committee at any time by notice in writing to such person. A person on the
Investment Committee may resign at any time by written notice of resignation to
the Primary Sponsor. Upon such removal or resignation, or in the event of the
death of a person on the Investment Committee, the Primary Sponsor may appoint a
successor. Until a successor has been appointed, the remaining persons on the
Investment Committee may continue to act as the Investment Committee.
11.7 Action by the Primary Sponsor or a Plan Sponsor. Any action to
be taken by the Primary Sponsor or a Plan Sponsor shall be taken by resolution
or written direction duly adopted by its board of directors or appropriate
governing body, as the case may be; provided, however, that by such resolution
or written direction, the board of directors or appropriate governing body, as
the case may be, may delegate to any officer or other appropriate person of a
Plan Sponsor the authority to take any such actions as may be specified in such
resolution or written direction, other than the power to amend, modify or
terminate the Plan or the Trust or to determine the basis of any Plan Sponsor
contributions.
11.8 Voting of Company Stock. The Trustee shall vote all shares of
Company Stock allocated to the Company Stock Subaccounts of Members as directed
by the administrative committee of the Plan Administrator, subject to the
requirements of the Plan, the Trust and ERISA.
SECTION 12
CLAIM REVIEW PROCEDURE
12.1 In the event that a Member or Beneficiary is denied a claim
for benefits under a Plan, the Plan Administrator shall provide to the claimant
written notice of the denial which shall set forth:
(a) the specific reasons for the denial;
(b) specific references to the pertinent provisions of
the Plan on which the denial is based;
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(c) a description of any additional material or
information necessary for the claimant to perfect the claim and an
explanation of why the material or information is necessary; and
(d) an explanation of the Plan's claim review procedure.
12.2 After receiving written notice of the denial of a claim, a
claimant or his representative may:
(a) request a full and fair review of the denial by
written application to the Plan Administrator;
(b) review pertinent documents; and
(c) submit issues and comments in writing to the Plan
Administrator.
12.3 If the claimant wishes a review of the decision denying his
claim to benefits under the Plan, he must submit the written application to the
Plan Administrator within sixty (60) days after receiving written notice of the
denial.
12.4 Upon receiving the written application for review, the Plan
Administrator may schedule a hearing for purposes of reviewing the claimant's
claim, which hearing shall take place not more than thirty (30) days from the
date on which the Plan Administrator received the written application for
review.
12.5 At least ten (10) days prior to the scheduled hearing, the
claimant and his representative designated in writing by him, if any, shall
receive written notice of the date, time, and place of the scheduled hearing.
The claimant or his representative may request that the hearing be rescheduled
for his convenience on another reasonable date or at another reasonable time or
place.
12.6 All claimants requesting a review of the decision denying
their claim for benefits may employ counsel for purposes of the hearing.
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12.7 No later than sixty (60) days following the receipt of the
written application for review, the Plan Administrator shall submit its decision
on the review in writing to the claimant involved and to his representative, if
any; provided, however, a decision on the written application for review may be
extended, in the event special circumstances such as the need to hold a hearing
require an extension of time, to a day no later than one hundred twenty (120)
days after the date of receipt of the written application for review. The
decision shall include specific reasons for the decision and specific references
to the pertinent provisions of the Plan on which the decision is based.
SECTION 13
LIMITATION OF ASSIGNMENT, PAYMENTS TO LEGALLY
INCOMPETENT DISTRIBUTEE AND UNCLAIMED PAYMENTS
13.1 No benefit which shall be payable under the Plan to any person
shall be subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance or charge, and any attempt to anticipate,
alienate, sell, transfer, assign, pledge, encumber or charge the same shall be
void; and no such benefit shall in any manner be liable for, or subject to, the
debts, contracts, liabilities, engagements or torts of any person, nor shall it
be subject to attachment or legal process for, or against, such person, and the
same shall not be recognized under the Plan, except to such extent as may be
required by law. Notwithstanding the above, this Section shall not apply to a
"qualified domestic relations order" (as defined in Code Section 414(p)), and
benefits may be paid pursuant to the provisions of such an order. The Plan
Administrator shall develop procedures (in accordance with applicable federal
regulations) to determine whether a domestic relations order is qualified, and,
if so, the method and the procedures for complying therewith.
13.2 If any person who shall be entitled to any benefit under the
Plan shall become bankrupt or shall attempt to anticipate, alienate, sell,
transfer, assign, pledge, encumber or charge such benefit under the Plan, then
the payment of any such benefit in the event a Member or Beneficiary is entitled
to payment shall, in the discretion of the Plan Administrator, cease and
terminate and in that event the Trustee shall hold or apply the same for the
benefit of such person, his spouse, children, other dependents or any of them in
such manner and in such proportion as the Plan Administrator shall determine.
13.3 Whenever any benefit which shall be payable under the Plan is
to be paid to or for the benefit of any person who is then a minor or determined
to be incompetent by qualified medical advice, the Plan Administrator need not
require the appointment of a guardian or custodian, but shall be authorized to
cause the same to be paid over to the person having custody of such minor or
incompetent, or to cause the same to be paid to such minor or incompetent
without the intervention of a guardian or custodian, or to cause the same to be
paid to a legal guardian or custodian of such minor or incompetent if one has
been appointed or to cause the same to be used for the benefit of such minor or
incompetent.
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13.4 If the Plan Administrator cannot ascertain the whereabouts of
any Member to whom a payment is due under the Plan, the Plan Administrator may
direct that the payment and all remaining payments otherwise due to the Member
be cancelled on the records of the Plan and the amount thereof applied as a
forfeiture in accordance with Plan Section 3.4, except that, in the event the
Member later notifies the Plan Administrator of his whereabouts and requests the
payments due to him under the Plan, the Plan Sponsor shall contribute to the
Plan an amount equal to the payment to be paid to him as soon as
administratively feasible.
SECTION 14
PROHIBITION AGAINST DIVERSION
At no time shall any part of the Fund be used for or diverted to
purposes other than the exclusive benefit of the Members or their Beneficiaries,
subject, however, to the payment of all taxes and administrative expenses and
subject to the provisions of the Plan with respect to returns of contributions.
SECTION 15
LIMITATION OF RIGHTS
Membership in the Plan shall not give any Employee any right or claim
except to the extent that such right is specifically fixed under the terms of
the Plan. The adoption of the Plan and the Trust by any Plan Sponsor shall not
be construed to give any Employee a right to be continued in the employ of a
Plan Sponsor or as interfering with the right of a Plan Sponsor to terminate the
employment of any Employee at any time.
SECTION 16
AMENDMENT TO OR TERMINATION OF THE PLAN AND THE TRUST
16.1 The Primary Sponsor reserves the right at any time to modify
or amend or terminate the Plan or the Trust in whole or in part by notice
thereof in writing delivered to the Trustee; provided, however, that the Primary
Sponsor shall have no power to modify or amend the Plan in such manner as would
cause or permit any portion of the funds held under a Plan to be used for, or
diverted to, purposes other than for the exclusive benefit of Members or their
Beneficiaries, or as would cause or permit any portion of a fund held under the
Plan to become the property of a Plan Sponsor; and provided further, that the
duties or liabilities of the Trustee shall not be increased without its written
consent. No such modifications or amendments shall have the effect of
retroactively changing or depriving Members or Beneficiaries of rights already
accrued under the Plan. No Plan Sponsor other than the Primary Sponsor shall
have the right to so modify, amend or terminate the Plan or the Trust.
Notwithstanding the foregoing, each Plan Sponsor may terminate its own
participation in the Plan and Trust pursuant to the Plan.
16.2 Each Plan Sponsor other than the Primary Sponsor shall have
the right to terminate its participation in the Plan and Trust by resolution of
its board of directors or other appropriate governing body and notice in writing
to the Primary Sponsor and the Trustee unless such termination
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would result in the disqualification of the Plan or the Trust or would adversely
affect the exempt status of the Plan or the Trust as to any other Plan Sponsor.
If contributions by or on behalf of a Plan Sponsor are completely terminated,
the Plan and Trust shall be deemed terminated as to such Plan Sponsor. Any
termination by a Plan Sponsor, shall not be a termination as to any other Plan
Sponsor.
16.3 (a) If the Plan is terminated by the Primary Sponsor or
if contributions to the Trust should be permanently discontinued, it
shall terminate as to all Plan Sponsors and the Fund shall be used,
subject to the payment of expenses and taxes, for the benefit of
Members and Beneficiaries, and for no other purposes, and the Account
of each affected Member shall be fully vested and nonforfeitable,
notwithstanding the provisions of the Section of the Plan which sets
forth the vesting schedule.
(b) In the event of the partial termination of the Plan,
each affected Member's Account shall be fully vested and
nonforfeitable, notwithstanding the provisions of the Section of the
Plan which sets forth the vesting schedule.
16.4 In the event of the termination of the Plan or the Trust with
respect to a Plan Sponsor, the Accounts of the Members with respect to the Plan
as adopted by such Plan Sponsor shall be held subject to the instructions of the
Plan Administrator; provided that the Trustee shall not be required to make any
distribution until it receives a copy of an Internal Revenue Service
determination letter to the effect that the termination does not affect the
qualified status of the Plan or the exempt status of the Trust or, in the event
that such letter is applied for and is not issued, until the Trustee is
reasonably satisfied that adequate provision has been made for the payment of
all taxes which may be due and owing by the Trust.
16.5 In the case of any merger or consolidation of the Plan with,
or any transfer of the assets or liabilities of the Plan to, any other plan
qualified under Code Section 401, the terms of the merger, consolidation or
transfer shall be such that each Member would receive (in the event of
termination of the Plan or its successor immediately thereafter) a benefit which
is no less than the benefit which the Member would have received in the event of
termination of the Plan immediately before the merger, consolidation or
transfer.
16.6 Notwithstanding any other provision of the Plan, an amendment
to the Plan --
(a) which eliminates or reduces an early retirement
benefit, if any, or which eliminates or reduces a retirement-type
subsidy (as defined in regulations issued by the Department of the
Treasury), if any, or
(b) which eliminates an optional form of benefit
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shall not be effective with respect to benefits attributable to service before
the amendment is adopted. In the case of a retirement-type subsidy described in
Subsection (a) above, this Section shall be applicable only to a Member who
satisfies, either before or after the amendment, the preamendment conditions for
the subsidy.
SECTION 17
ADOPTION OF PLAN BY AFFILIATES
Any corporation or other business entity related to the Primary
Sponsor by function or operation and any Affiliate, if the corporation, business
entity or Affiliate is authorized to do so by written direction adopted by the
Board of Directors, may adopt the Plan and the related Trust by action of the
board of directors or other appropriate governing body of such corporation,
business entity or Affiliate. Any adoption shall be evidenced by certified
copies of the resolutions of the foregoing board of directors or governing body
indicating the adoption and by the execution of the Trust by the adopting
corporation, or business entity or Affiliate. The resolution shall state and
define the effective date of the adoption of the Plan by the Plan Sponsor and,
for the purpose of Code Section 415, the "limitation year" as to such Plan
Sponsor. Notwithstanding the foregoing, however, if the Plan and Trust as
adopted by an Affiliate or other corporation or business entity under the
foregoing provisions shall fail to receive the initial approval of the Internal
Revenue Service as a qualified Plan and Trust under Code Sections 401(a) and
501(a), any contributions by the Affiliate or other corporation or business
entity after payment of all expenses will be returned to such Plan Sponsor free
of any trust, and the Plan and Trust shall terminate, as to the adopting
Affiliate or other corporation or business entity.
SECTION 18
QUALIFICATION AND RETURN OF CONTRIBUTIONS
18.1 If the Plan and the related Trust fail to receive the initial
approval of the Internal Revenue Service as a qualified plan and trust within
one (1) year after the date of denial of qualification (a) the contribution of a
Plan Sponsor after payment of all expenses will be returned to a Plan Sponsor
free of the Plan and Trust, (b) contributions made by a Member shall be returned
to the Member who made the contributions, and (c) the Plan and Trust shall
thereupon terminate.
18.2 If and to the extent permitted by the Code and other
applicable laws and regulations thereunder, upon a Plan Sponsor's request, a
contribution which was made by reason of a mistake of fact or upon the
deductibility of the contribution under Code Section 404, shall be returned to a
Plan Sponsor within one (1) year after the payment of the contribution, or the
disallowance of the deduction (to the extent disallowed), whichever is
applicable.
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In the event of a contribution which was made by reason of a mistake
of fact or which was conditioned upon the deductibility of the contribution, the
amount to be returned to the Plan Sponsor shall be the excess of the
contribution above the amount that would have been contributed had the mistake
of fact or the mistake in determining the deduction not occurred, less any net
loss attributable to the excess. Any net income attributable to the excess shall
not be returned to the Plan Sponsor. No return of any portion of the excess
shall be made to the Plan Sponsor if the return would cause the balance in a
Member's Account to be less than the balance would have been had the mistaken
contribution not been made.
SECTION 19
INCORPORATION OF SPECIAL LIMITATIONS
Appendices A, B, and C to the Plan, attached hereto, are incorporated
by reference and the provisions of the same shall apply notwithstanding anything
to the contrary contained herein.
IN WITNESS WHEREOF, the Primary Sponsor has caused this indenture to
be executed as of the date first above written.
FIRST BANKING COMPANY OF
SOUTHEAST GEORGIA
By: /s/ Xxxxx X. Xxxxxx
----------------------------------------
Title: President
-------------------------------------
ATTEST:
/s/
--------------------------------
Title: Secretary
--------------------------
[CORPORATE SEAL]
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APPENDIX A
SPECIAL NONDISCRIMINATION RULES
SECTION 1
As used in this Appendix, the following words shall have the
following meanings:
(a) "Eligible Member" means a Member who is an Employee
during any particular Plan Year.
(b) "Highly Compensated Eligible Member" means any
Eligible Member who is a Highly Compensated Employee.
(c) "Matching Contribution" means any contribution made
by a Plan Sponsor to a Matching Account and any other contribution made
to a plan by a Plan Sponsor or an Affiliate on behalf of an Employee on
account of a contribution made by an Employee or on account of an
Elective Deferral.
(d) "Qualified Matching Contributions" means Matching
Contributions which are immediately nonforfeitable when made, and which
would be nonforfeitable, regardless of the age or service of the
Employee or whether the Employee is employed on a certain date, and
which may not be distributed, except upon one of the events described
under Section 401(k)(2)(B) of the Code and the regulations thereunder.
(e) "Qualified Nonelective Contributions" means
contributions of the Plan Sponsor or an Affiliate, other than Matching
Contributions or Elective Deferrals, which are nonforfeitable when
made, and which would be nonforfeitable regardless of the age or
service of the Employee or whether the Employee is employed on a
certain date, and which may not be distributed, except upon one of the
events described under Code Section 401(k)(2)(B) and the regulations
thereunder.
SECTION 2
In addition to any other limitations set forth in the Plan, for each
Plan Year one of the following tests must be satisfied:
(a) the actual deferral percentage for the Highly
Compensated Eligible Members must not be more than the actual deferral
percentage of all other Eligible Members multiplied by 1.25; or
(b) the excess of the actual deferral percentage for the
Highly Compensated Eligible Members over that of all other Eligible
Members must not be more than two (2) percentage points, and the actual
deferral percentage for the Highly Compensated Eligible Members must
not be more than the actual deferral percentage of all other Eligible
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Members multiplied by two (2).
The "actual deferral percentage" for the Highly Compensated Eligible Members and
all other Eligible Members for a Plan Year is the average in each group of the
ratios, calculated separately for each Employee, of the Deferral Amounts
contributed by the Plan Sponsor on behalf of an Employee for the Plan Year to
the Annual Compensation of the Employee in the Plan Year. In addition, for
purposes of calculating the "actual deferral percentage" as described above,
Deferral Amounts of Employees who are not Highly Compensated Employees which are
prohibited by Code Section 401(a)(30) shall not be taken into consideration.
Except to the extent limited by Treasury Regulation section 1.401(k)-1(b)(5) and
any other applicable regulations promulgated by the Secretary of the Treasury,
all or part of the Qualified Matching Contributions and Qualified Nonelective
Contributions made pursuant to the Plan may be treated as Deferral Amounts for
purposes of determining the "actual deferral percentage."
SECTION 3
If the Deferral Amounts contributed on behalf of any Highly
Compensated Eligible Member exceeds the amount permitted under the "actual
deferral percentage" test described in Section 2 of this Appendix A for any
given Plan Year, then before the end of the Plan Year following the Plan Year
for which the Excess Deferral Amount was contributed, (a) the amount of the
Excess Deferral Amount for the Plan Year, as adjusted to reflect income, gain,
or loss attributable to it through the date the Excess Deferral Amount is
distributed to the Member and reduced by any excess Elective Deferrals as
determined pursuant to Plan Section 3.1 previously distributed to the Member for
the Member's taxable year ending with or within the Plan Year, may be
distributed to the Highly Compensated Eligible Member or (b) to the extent
provided in regulations issued by the Secretary of the Treasury, the Plan
Administrator may permit the Member to elect, within two and one-half months
after the end of the Plan Year for which the Excess Deferral Amount was
contributed, to treat the Excess Deferral Amount, unadjusted for earnings,
gains, and losses, but as so reduced, as an amount distributed to the Member and
then contributed as an after-tax contribution by the Member to the Plan
("recharacterized amounts"). The income allocable to such Excess Deferral Amount
shall be determined in a similar manner as described in Section 4.2 of the Plan.
The Excess Deferral Amount to be distributed or recharacterized shall be reduced
by Deferral Amounts previously distributed or recharacterized for the taxable
year ending in the same Plan Year, and shall also be reduced by Deferral Amounts
previously distributed or recharacterized for the Plan Year beginning in such
taxable year. For all other purposes under the Plan other than this Appendix A
recharacterized amounts shall continue to be treated as Deferral Amounts. In the
event the multiple use of limitations contained in Sections 2(b) and 5(b) of
this Appendix, pursuant to Treasury Regulations section 1.401(m)-2 as
promulgated by the Secretary of the Treasury, requires a corrective
distribution, such distribution shall be made pursuant to this Section 3, and
not Section 6 of Appendix A.
For purposes of this Section 3, "Excess Deferral Amount" means, with respect to
a Plan Year, the excess of:
(a) the aggregate amount of Deferral Amounts contributed
by a Plan Sponsor on
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behalf of Highly Compensated Eligible Members for the Plan Year, over
(b) the maximum amount of Deferral Amounts permitted
under Section 2 of this Appendix A for the Plan Year, which shall be
determined by reducing the Deferral Amounts contributed on behalf of
Highly Compensated Eligible Members in order of the actual deferral
percentages beginning with the highest of such percentages.
Distribution of the Excess Deferral Amounts for any Plan Year shall be made to
the Highly Compensated Eligible Members on the basis of the respective portions
of the Excess Deferral Amount attributable to each Highly Compensated Eligible
Member. As to any Highly Compensated Employee who is subject to the family
aggregation rules of subsection (b) of the Plan Section containing the
definition of the term "Highly Compensated Employee," any distribution of such
Highly Compensated Employee's allocable portion of the Excess Deferral Amount
for a Plan Year shall be allocated among the family members of such Highly
Compensated Employee who are combined to determine the actual deferral
percentage in proportion to the Deferral Amounts taken into account under this
Section 3.
SECTION 4
The Plan Administrator shall have the responsibility of monitoring
the Plan's compliance with the limitations of this Appendix A and shall have the
power to take all steps it deems necessary or appropriate to ensure compliance,
including, without limitation, restricting the amount which Highly Compensated
Eligible Members can elect to have contributed pursuant to Plan Section 3.1. Any
actions taken by the Plan Administrator pursuant to this Section 4 shall be
pursuant to non-discriminatory procedures consistently applied.
SECTION 5
In addition to any other limitations set forth in the Plan, Matching
Contributions under the Plan and the amount of nondeductible employee
contributions under the Plan, for each Plan Year must satisfy one of the
following tests:
(a) The contribution percentage for Highly Compensated
Eligible Members must not exceed 125% of the contribution percentage
for all other Eligible Members; or
(b) The contribution percentage for Highly Compensated
Eligible Members must not exceed the lesser of (1) 200% of the
contribution percentage for all other Eligible Members, and (2) the
contribution percentage for all other Eligible Members plus two (2)
percentage points.
Notwithstanding the foregoing, for purposes of this Section 5, the terms Highly
Compensated Eligible Member and Eligible Member shall not include any Member who
is not eligible to receive a Matching Contribution under the provisions of the
Plan, other than as a result of the Member failing to contribute to the Plan or
failing to have an Elective Deferral contributed to the Plan on the
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Member's behalf. Notwithstanding the foregoing, if Qualified Matching
Contributions are taken into account for purposes of applying the test contained
in Section 2 of this Appendix A, they shall not be taken into account under this
Section 5. In applying the above tests, the Plan Administrator shall comply with
any regulations promulgated by the Secretary of the Treasury which prevent or
restrict the use of the test contained in Section 2(b) of this Appendix A and
the test contained in Section 5(b) of this Appendix A. The "contribution
percentage" for Highly Compensated Eligible Members and for all other Eligible
Members for a Plan Year shall be the average of the ratios, calculated
separately for each Member, of (A) to (B), where (A) is the amount of Matching
Contributions under the Plan (excluding Qualified Matching Contributions which
are used to apply the test set forth in Section 2 of this Appendix A or Matching
Contributions which are used to satisfy the minimum required contributions to
the Accounts of Eligible Members who are not Key Employees pursuant to Section 1
of Appendix C to the Plan) and nondeductible employee contributions made under
the Plan for the Eligible Member for the Plan Year, and where (B) is the Annual
Compensation of the Eligible Member for the Plan Year. Except to the extent
limited by Treasury Regulation Section 1.401(m)-1(b)(5) and any other applicable
regulations promulgated by the Secretary of the Treasury, a Plan Sponsor may
elect to treat Deferral Amounts and Qualified Nonelective Contributions as
Matching Contributions for purpose of determining the "contribution percentage,"
provided the Deferral Amounts, excluding those treated as Matching
Contributions, satisfy the test set forth in Section 2 of Appendix A.
SECTION 6
If the Matching Contributions and nondeductible employee
contributions and, if taken into account under Section 5 of this Appendix A, the
Deferral Amounts made by or on behalf of Highly Compensated Eligible Members
exceed the amount permitted under the "contribution percentage test" for any
given Plan Year, then, before the close of the Plan Year following the Plan Year
for which the excess aggregate contributions were made, the amount of the excess
aggregate contributions attributable to the Plan for the Plan Year, as adjusted
to reflect any income, gain or loss attributable to such contributions through
the date the excess aggregate contributions are distributed or forfeited, shall
be distributed or, if the excess aggregate contributions are forfeitable,
forfeited. The income allocable to such contributions shall be determined in a
similar manner as described in Section 4.2 of the Plan. As to any Highly
Compensated Employee, any distribution or forfeiture of his allocable portion of
the excess aggregate contributions for a Plan Year shall first be attributed to
any nondeductible employee contributions made by the Member during the Plan Year
for which no corresponding Plan Sponsor contribution is made and then to any
remaining nondeductible employee contributions made by the Member during the
Plan Year and any Matching Contributions thereon. As between the Plan and any
other plan or plans maintained by the Plan Sponsor in which excess aggregate
contributions for a Plan Year are held, each such plan shall distribute or
forfeit a pro-rata share of each class of contribution based on the respective
amounts of a class of contribution made to each plan during the Plan Year. The
payment of the excess aggregate contributions shall be made without regard to
any other provision in the Plan. In the event the multiple use of limitations
contained in Sections 2(b) and 5(b) of this Appendix, pursuant to Treasury
Regulation section 1.401(m)-2 as promulgated by the Secretary of the Treasury,
requires a corrective distribution, such distribution shall be made pursuant to
Section 3 of Appendix A, and not this Section 6.
A-4
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For purposes of this Section 6, with respect to any Plan Year,
"excess aggregate contributions" means the excess of:
(a) the aggregate amount of the Matching Contributions
and nondeductible employee contributions and, if taken into account
under Section 5 of this Appendix A, the Deferral Amounts actually made
on behalf of Highly Compensated Eligible Members for the Plan Year,
over
(b) the maximum amount of the contributions permitted
under the limitations of Section 5 of this Appendix A, determined by
reducing contributions made on behalf of Highly Compensated Eligible
Members in order of their contribution percentages beginning with the
highest of such percentages.
Distribution or forfeiture of nondeductible employee contributions or Matching
Contributions in the amount of the excess aggregate contributions for any Plan
Year shall be made with respect to Highly Compensated Employees on the basis of
the respective portions of the excess aggregate contributions attributable to
each Highly Compensated Employee. Forfeitures of excess aggregate contributions
may not be allocated to Members whose contributions are reduced under this
Section 6. As to any Highly Compensated Employee who is subject to the family
aggregation rules of subsection (b) of the Plan Section containing the
definition of the term "Highly Compensated Employee," any distribution or
forfeiture of such Highly Compensated Employee's allocable portion of the excess
aggregate contributions for a Plan Year shall be allocated among the family
members of such Highly Compensated Employee which are combined to determine the
contribution percentage in proportion to the contributions taken into account
under this Section 6.
The determination of the amount of excess aggregate contributions under this
Section 6 shall be made after (1) first determining the excess Elective
Deferrals under Section 3.1(b) of the Plan, and (2) then determining the Excess
Deferral Amounts under Section 3 of this Appendix A.
SECTION 7
Except to the extent limited by rules promulgated by the Secretary of
the Treasury, if a Highly Compensated Eligible Member is a participant in any
other plan of the Plan Sponsor or any Affiliate which includes Matching
Contributions, deferrals under a cash or deferred arrangement pursuant to Code
Section 401(k), or nondeductible employee contributions, any contributions made
by or on behalf of the Member to the other plan shall be allocated with the same
class of contributions under the Plan for purposes of determining the "actual
deferral percentage" and "contribution percentage" under the Plan; provided,
however, contributions that are made under an "employee stock ownership plan"
(within the meaning of Code Section 4975(e)(7)) shall not be combined with
contributions under any plan which is not an employee stock ownership plan
(within the meaning of Code Section 4975(e)(7)).
Except to the extent limited by rules promulgated by the Secretary of the
Treasury, if the Plan and any other plans which include Matching Contributions,
deferrals under a cash or deferred arrangement pursuant to Code Section 401(k),
or nondeductible employee contributions are
A-5
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considered as one plan for purposes of Code Section 401(a)(4) and 410(b)(1), any
contributions under the other plans shall be allocated with the same class of
contributions under the Plan for purposes of determining the "contribution
percentage" and "actual deferral percentage" under the Plan; provided, however,
contributions that are made under an "employee stock ownership plan" (within the
meaning of Code Section 4975(e)(7)) shall not be combined with contributions
under any plan which is not an employee stock ownership plan (within the meaning
of Code Section 4975(e)(7)).
A-6
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XXXXXXXX X
XXXXXXXXXX XX ALLOCATIONS
SECTION 1
The "annual addition" for any Member for any one limitation year may
not exceed the lesser of:
(a) $30,000 (or, if greater, one-quarter of the dollar
limitation in effect under Code Section 415(b)(1)(A)), which amount
shall be adjusted for changes in the cost of living as provided in
regulations issued by the Secretary of the Treasury; or
(b) 25% of the Member's Annual Compensation.
SECTION 2
For the purposes of this Appendix B, the term "annual addition" for
any Member means for any limitation year, the sum of certain Plan Sponsor and
Member contributions, forfeitures, and other amounts as determined in Code
Section 415(c)(2) in effect for that limitation year.
SECTION 3
In the event that a Plan Sponsor maintains a defined benefit plan
under which a Member also participates, the sum of the defined benefit plan
fraction and the defined contribution plan fraction for any limitation year for
any Member may not exceed 1.0.
(a) The defined benefit plan fraction for any limitation
year is a fraction:
(1) the numerator of which is the projected
annual benefit of the Member under the defined benefit plan
(determined as of the close of such year); and
(2) the denominator of which is the lesser of
(A) the product of 1.25, multiplied by
the maximum annual benefit allowable under Code
Section 415(b)(1)(A), or
(B) the product of
(i) 1.4, multiplied by
B-1
47
(ii) the maximum amount which
may be taken into account under Section
415(b)(1)(B) of the Code with respect to the
Member under the defined benefit plan for
the limitation year (determined as of the
close of the limitation year).
(b) The defined contribution plan fraction for any
limitation year is a fraction:
(1) the numerator of which is the sum of a
Member's annual additions as of the close of the year; and
(2) the denominator of which is the sum of the
lesser of the following amounts determined for the year and
for all prior limitation years during which the Member was
employed by a Plan Sponsor:
(A) the product of 1.25, multiplied by
the dollar limitation in effect under Code Section
415(c)(1)(A) for the limitation year (determined
without regard to Section 415(c)(6) of the Code); or
(B) the product of
(i) 1.4, multiplied by
B-2
48
(ii) the amount which may be
taken into account under Code Section
415(c)(1)(B) (or Code Section 415(c)(7), if
applicable) with respect to the Member for
the limitation year.
SECTION 4
For purposes of this Appendix B, the term "limitation year" shall
mean a Plan Year unless a Plan Sponsor elects, by adoption of a written
resolution, to use any other twelve-month period adopted in accordance with
regulations issued by the Secretary of the Treasury. For purposes of applying
the limitations set forth in this Appendix B, the term "Plan Sponsor" shall mean
a Plan Sponsor and any other corporations which are members of the same
controlled group of corporations (as described in Section 414(b) of the Code, as
modified by Code Section 415(h)) as is a Plan Sponsor, any other trades or
businesses (whether or not incorporated) under common control (as described in
Code Section 414(c), as modified by Code Section 415(h)) with a Plan Sponsor,
any other corporations, partnerships, or other organizations which are members
of an affiliated service group (as described in Section 414(m) of the Code) with
a Plan Sponsor, and any other entity required to be aggregated with a Plan
Sponsor pursuant to regulations under Code Section 414(o).
SECTION 5
For purposes of applying the limitations of this Appendix B, all
defined contribution plans maintained or deemed to be maintained by a Plan
Sponsor shall be treated as one defined contribution plan, and all defined
benefit plans now or previously maintained or deemed to be maintained by a Plan
Sponsor shall be treated as one defined benefit plan. In the event the Plan
Sponsor maintains more than one defined contribution plan and the limitations of
this Appendix B would otherwise be exceeded with respect to both this Plan and
the other defined contribution plans, this Appendix B shall be applied first to
reduce allocations of contributions to this Plan.
SECTION 6
In the event that as a result of either the allocation of forfeitures
to the Account of a Member or a reasonable error in estimating the Member's
Annual Compensation, the annual addition allocated to the Account of a Member
exceeds the limitations set forth in Section 1 of this Appendix B or in the
event that the aggregate contributions made on behalf of a Member under both a
defined benefit plan and a defined contribution plan, subject to the reduction
of allocations in other defined contribution plans required by Section 5 of this
Appendix B, cause the aggregate limitation fraction set forth in Section 3 of
this Appendix B to be exceeded, the Plan Administrator shall, in writing, direct
the Trustee to take such of the following actions as the Plan Administrator
shall deem appropriate, specifying in each case the amount or amounts of
contributions involved:
(a) A Member's annual addition shall be reduced by
distributing to the Member
B-3
49
contributions made by the Plan Sponsor on behalf of the Member pursuant
to Plan Section 3.1, with respect to which no contribution is made
under Plan Section 3.2, which cause the annual addition to exceed such
limitations;
(b) If further reduction is necessary, contributions made
by the Plan Sponsor on behalf of the Member pursuant to Plan Section
3.1 and contributions of the Plan Sponsor thereon pursuant to Plan
Section 3.2 shall be reduced in the amount of the remaining excess. The
amount of the reduction under Plan Section 3.1 shall be distributed to
the Member. The amount of the reduction under Plan Section 3.2 shall be
reallocated to the Matching Accounts of Members who are not affected by
the limitation in the same proportion as the contribution of the Plan
Sponsor for the year is allocated under Plan Section 4.1 to the
Accounts of such Members;
(c) If further reduction is necessary, contributions made
by the Plan Sponsor on behalf of the Member pursuant to Plan Section
3.3 shall be reduced in the amount of the remaining excess. The amount
of the reduction shall be reallocated to the Accounts of Members who
are not affected by the limitations in the same proportion as the
contribution of the Plan Sponsor for the year is allocated under Plan
Section 4.1 to the Accounts of such Members; and
(d) If the contribution of the Plan Sponsor would cause
the annual addition to exceed the limitations set forth herein with
respect to all Members under the Plan, the portion of such contribution
in excess of the limitations shall be segregated in a suspense account.
While the suspense account is maintained, (1) no Plan Sponsor
contributions under the Plan shall be made which would be precluded by
this Appendix B, (2) income, gains and loses of the Fund shall not be
allocated to such suspense account and (3) amounts in the suspense
account shall be allocated in the same manner as Plan Sponsor
contributions and forfeitures under the Plan as of each Valuation Date
on which Plan Sponsor contributions may be allocated until the suspense
account is exhausted. In the event of the termination of the Plan, the
amounts in the suspense account shall be returned to the Plan Sponsor
to the extent that such amounts may not then be allocated to the
Members' Accounts.
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APPENDIX C
TOP-HEAVY PROVISIONS
SECTION 1
As used in this Appendix, the following words shall have the
following meanings:
(a) "Determination Date" means, with respect to any Plan
Year, the last day of the preceding Plan Year, or, in the case of the
first Plan Year, means the last day of the first Plan Year.
(b) "Key Employee" means an Employee or former Employee
(including a Beneficiary of a Key Employee or former Key Employee) who
at any time during the Plan Year containing the Determination Date or
any of the four (4) preceding Plan Years is:
(1) An officer described in the Subsection of
the Plan Section containing the definition of the term "Highly
Compensated Employee";
(2) One of the ten (10) Employees owning both
(A) more than one-half percent (1/2%) of the outstanding stock
of the Plan Sponsor, more than one-half percent (1/2%) of the
total combined voting power of all stock of the Plan Sponsor,
or more than one-half percent (1/2%) of the capital or profits
interest in the Plan Sponsor, and (B) the largest percentage
ownership interests in the Plan Sponsor or any of its
Affiliates, and whose Annual Compensation is equal to or
greater than the amount in effect under Section 1(a) of
Appendix B to the Plan for the calendar year in which the
Determination Date falls; or
(3) An owner of more than five percent (5%) of
the outstanding stock of the Plan Sponsor or more than five
percent (5%) of the total combined voting power of all stock
of the Plan Sponsor; or
(4) An owner of more than one percent (1%) of
the outstanding stock of the Plan Sponsor or more than one
percent (1%) of the total combined voting power of all stock
of the Plan Sponsor, and who in such Plan Year had Annual
Compensation from the Plan Sponsor and all of its Affiliates
of more than $150,000.
Employees other than Key Employees are sometimes referred to in this
Appendix as "non-key employees."
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51
(c) "Required Aggregation Group" means:
(1) each plan of the Plan Sponsor and its
Affiliates which qualifies under Code Section 401(a) in which
a Key Employee is a participant, and
(2) each other plan of the Plan Sponsor and its
Affiliates which qualifies under Code Section 401 (a) and
which enables any plan described in Subsection (a) of this
Section to meet the requirements of Section 401(a)(4) or 410
of the Code.
(d) (1) "Top-Heavy" means:
(A) if the Plan is not included in a
Required Aggregation Group, the Plan's condition in a
Plan Year for which, as of the Determination Date:
(i) the present value of the
cumulative Accrued Benefits under the Plan
for all Key Employees exceeds 60 percent of
the present value of the cumulative Accrued
Benefits under the Plan for all Members; and
(ii) the Plan, when included
in every potential combination, if any, with
any or all of:
(I) any Required Aggregation
Group, and
(II) any plan of the Plan
Sponsor which is not part of any Required
Aggregation Group and which qualifies under
Code Section 401 (a)
is part of a Top-Heavy Group (as defined in
Paragraph (2) of this Subsection); and
(B) if the Plan is included in a
Required Aggregation Group, the Plan's condition in a
Plan Year for which, as of the Determination Date:
(i) the Required Aggregation
Group is a Top-Heavy Group (as defined in
Paragraph (2) of this Subsection); and
(ii) the Required Aggregation
Group, when included in every potential
combination, if any, with any or all of the
plans of the Plan Sponsor and its Affiliates
which are not part of the Required
Aggregation Group and which qualify under
Code Section 401(a), is part of a Top-Heavy
Group (as defined in Paragraph (2) of this
Subsection).
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52
(C) For purposes of Subparagraphs
(A)(i) and (B)(ii) of this Paragraph (1), any
combination of plans must satisfy the requirements of
Sections 401(a)(4) and 410 of the Code.
(2) A group shall be deemed to be a Top-Heavy
Group if:
(A) the sum, as of the Determination
Date, of the present value of the cumulative accrued
benefits for all Key Employees under all plans
included in such group exceeds
(B) 60 percent of a similar sum
determined for all participants in such plans.
(3) (A) For purposes of this Section, the
present value of the accrued benefit for any participant in a
defined contribution plan as of any Determination Date or last
day of a plan year shall be the sum of:
(i) as to any defined
contribution plan other than a simplified
employee pension, the account balance as of
the most recent valuation date occurring
within the plan year ending on the
Determination Date or last day of a plan
year, and
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(ii) as to any simplified
employee pension, the aggregate employer
contributions, and
(iii) an adjustment for
contributions due as of the Determination
Date or last day of a plan year.
In the case of a plan that is not subject to the
minimum funding requirements of Code Section 412, the
adjustment in Clause (iii) of this Subparagraph (A)
shall be the amount of any contributions actually
made after the valuation date but on or before the
Determination Date or last day of the plan year to
the extent not included under Clause (i) or (ii) of
this Subparagraph (A); provided, however, that in the
first plan year of the plan, the adjustment in Clause
(iii) of this Subparagraph (A) shall also reflect the
amount of any contributions made thereafter that are
allocated as of a date in such first plan year. In
the case of a plan that is subject to the minimum
funding requirements, the account balance in Clause
(i) and the aggregate contributions in Clause (ii) of
this Subparagraph (A) shall include contributions
that would be allocated as of a date not later than
the Determination Date or last day of a plan year,
even though those amounts are not yet required to be
contributed, and the adjustment in Clause (iii) of
this Subparagraph (A) shall be the amount of any
contribution actually made (or due to be made) after
the valuation date but before the expiration of the
extended payment period in Code Section 412(c)(10) to
the extent not included under Clause (i) or (ii) of
this Subparagraph (A).
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(B) For purposes of this Subsection,
the present value of the accrued benefit for any
participant in a defined benefit plan as of any
Determination Date or last day of a plan year must be
determined as of the most recent valuation date which
is within a 12-month period ending on the
Determination Date or last day of a plan year as if
such participant terminated as of such valuation
date; provided, however, that in the first plan year
of a plan, the present value of the accrued benefit
for a current participant must be determined either
(i) as if the participant terminated service as of
the Determination Date or last day of a plan year or
(ii) as if the participant terminated service as of
such valuation date, but taking into account the
estimated accrued benefit as of the Determination
Date or last day of a plan year. For purposes of this
Subparagraph (B), the valuation date must be the same
valuation date used for computing plan costs for
minimum funding, regardless of whether a valuation is
performed that year. The actuarial assumptions
utilized in calculating the present value of the
accrued benefit for any participant in a defined
benefit plan for purposes of this Subparagraph (B)
shall be established by the Plan Administrator after
consultation with the actuary for the plan, and shall
be reasonable in the aggregate and shall comport with
the requirements set forth by the Internal Revenue
Service in Q&A T-26 and T-27 of Regulation Section
1.416-1.
(C) For purposes of determining the
present value of the cumulative accrued benefit under
a plan for any participant in accordance with this
Subsection, the present value shall be increased by
the aggregate distributions made with respect to the
participant (including distributions paid on account
of death to the extent they do not exceed the present
value of the cumulative accrued benefit existing
immediately prior to death) under each plan being
considered, and under any terminated plan which if it
had not been terminated would have been in a Required
Aggregation Group with the Plan, during the 5-year
period ending on the Determination Date or last day
of the plan year that falls within the calendar year
in which the Determination Date falls.
(D) For purposes of this Paragraph (3),
participant contributions which are deductible as
"qualified retirement contributions" within the
meaning of Code Section 219 or any successor, as
adjusted to reflect income, gains, losses, and other
credits or charges attributable thereto, shall not be
considered to be part of the accrued benefits under
any plan.
(E) For purposes of this Paragraph (3),
if any employee is not a Key Employee with respect to
any plan for any plan year, but such employee was a
Key Employee with respect to such plan for any prior
plan year, any accrued benefit for such employee
shall not be taken into account.
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(F) For purposes of this Paragraph (3),
if any employee has not performed any service for any
Plan Sponsor or Affiliate maintaining the plan during
the five-year period ending on the Determination
Date, any accrued benefit for that employee shall not
be taken into account.
under this Section; and
(G) (i) In the case of an "unrelated
rollover" (as defined below) between plans
which qualify under Code Section 401(a), (a)
the plan providing the distribution shall
count the distribution as a distribution
under Subparagraph (C) of this Paragraph
(3), and (b) the plan accepting the
distribution shall not consider the
distribution part of the accrued benefit
(ii) in the case of a "related
rollover" (as defined below) between plans
which qualify under Code Section 401(a), (a)
the plan providing the distribution shall
not count the distribution as a distribution
under Subparagraph (C) of this Paragraph
(3), and (b) the plan accepting the
distribution shall consider the distribution
part of the accrued benefit under this
Section.
For purposes of this Subparagraph (G), an "unrelated rollover" is a rollover as
defined in Code Section 402(a)(5) or 408(d)(3) or a plan-to-plan transfer which
is both initiated by the participant and made from a plan maintained by one
employer to a plan maintained by another employer where the employers are not
Affiliates. For purposes of this Subparagraph (G), a "related rollover" is a
rollover as defined in Code Section 402(a)(5) or 408(d)(3) or a plan-to-plan
transfer which is either not initiated by the participant or made to a plan
maintained by the employer or an Affiliate.
SECTION 2
(a) Notwithstanding anything contained in the Plan to the
contrary, except as otherwise provided in Subsection (b) of this
Section, in any Plan Year during which the Plan is Top-Heavy,
allocations of Plan Sponsor contributions for the Plan Year for the
Account of each Member who is not a Key Employee and who has not
separated from service with the Plan Sponsor prior to the end of the
Plan Year shall not be less than 3 percent of the Member's Annual
Compensation. For purposes of this Subsection, an allocation to a
Member's Account resulting from any Plan Sponsor contribution
attributable to a salary reduction or similar arrangement shall not be
taken into account.
(b) (1) The percentage referred to in Subsection (a) of
this Section for any Plan Year shall not exceed the percentage
at which allocations are made or required to be made under the
Plan for the Plan Year for the Key Employee for whom the
percentage is highest for the Plan Year. For purposes of this
Paragraph, an allocation to the Account of a Key Employee
resulting from any Plan Sponsor contribution attributable to a
salary reduction or similar agreement shall be taken into
account.
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(2) For purposes of this Subsection (b), all
defined contribution plans which are members of a Required
Aggregation Group shall be treated as part of the Plan.
(3) This Subsection (b) shall not apply to any
plan which is a member of a Required Aggregation Group if the
plan enables a defined benefit plan which is a member of the
Required Aggregation Group to meet the requirements of Code
Section 401(a)(4) or 410.
SECTION 3
In any limitation year (as defined in Section 4 of Appendix B to the
Plan) which contains any portion of a Plan Year in which the Plan is Top-Heavy,
the number "1.0" shall be substituted for the number "1.25" in Section 3 of
Appendix B to the Plan.
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