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HOLIDAY RAMBLER CORPORATION
EMPLOYEES' RETIREMENT PLAN
AS AMENDED AND RESTATED EFFECTIVE JANUARY 1, 1989
RECITALS
A. Effective as of January 1, 1984, Holiday Rambler Corporation (the
"Employer") established a profit sharing plan known as the Holiday
Rambler Corporation Employees' Retirement Plan to provide financial
benefits to the Employer's eligible employees upon retirement and to
their dependents and beneficiaries in the event of death or
disability.
B. The following instrument is intended to amend and restate the Plan.
C. Society National Bank, Indiana, Elkhart, Indiana (the "Trustee") is
the Trustee of the Plan.
D. The Plan, as amended and restated, is designed to meet the
requirements of the relevant provisions of federal law governing
defined contribution retirement plans including, but not limited to,
the Internal Revenue Code of 1986 (Code) and the Employee Retirement
Security Act of 1974 (ERISA).
E. The provisions of this Plan shall apply only to an Employee whose
employment is terminated on or after January 1, 1989, which is the
date that this amended Plan becomes operative.
TERMS AND CONDITIONS
ARTICLE I
Eligibility Requirements
1.01 Required Age and Service.
(a) Plan Years Prior To January 1, 1990. For Plan Years
beginning prior to January 1, 1990, an Employee, unless
such Employee irrevocably elects in writing not to become a
Participant pursuant to Section 1.04, shall become a
Participant as of the January 1st following the date on
which the Employee first completes the following
eligibility requirements if the Employee is still employed
on such entry date:
(1) Attainment of age 18; and
(2) Completion of 250 Hours of Service within any three
(3) consecutive month period within the same Plan Year
(b) Plan Years After December 31, 1989 But Prior To January 1,
1992. For Plan Years beginning after December 31, 1989, an
Employee, unless such Employee irrevocably elects in
writing not to become a Participant pursuant to Section
1.04, shall become a Participant as of the January 1 or
July 1 following the date on which the Employee first
completes the following eligibility requirements if the
Employee is still employed on such entry date:
(1) Attainment of age 18; and
(2) Completion of one (1) Year of Service.
(c) Plan Years After December 31, 1991. For Plan Years
beginning after December 31, 1991, an Employee, unless such
Employee irrevocably elects in writing not to become a
Participant pursuant to Section 1.04, shall become a
Participant as of the January 1 or July 1 following the
date on which the Employee first completes the following
eligibility requirements:
(1) Attainment of age 18; and
(2) Completion of 500 Hours of Service within a six (6)
consecutive month period of employment with the
Employer.
1.02 Plan Information. The Plan Administrator shall make available
to all Participants relevant information concerning their rights
under this Plan.
1.03 Participant Cooperation. Each Participant agrees to:
(a) look solely to the assets of the Plan for the payment of
any benefits to which such Participant is entitled unless
otherwise provided by law; and
(b) execute and complete such applications or other forms
required by the Trustee.
1.04 Election Not to Participate. An Employee may make an
irrevocable election not to participate in the Plan upon the
Employee's commencement of employment or upon the Employee's
first becoming eligible to participate in the Plan. The
Employee's election not to participate shall be in writing and
shall specify whether the election is full or partial. A
partial election is an election to have a specified percentage
or amount of compensation contributed by the Employer to the
Plan during the duration of the Employee's employment. Nothing
in this Section 1.04 shall be interpreted to preclude alteration
in a Participant's Elective Deferrals pursuant to Section 2.02.
1.05 Rehired Participant. A former Participant whose employment with
the Employer was terminated for any reason and who is rehired by
the Employer shall re-enter the Plan as a Participant as of the
first day of any calendar quarter following the date on which he
is rehired unless he elects in writing not to become a
Participant pursuant to the provisions of Section 1.04.
1.06 Transfers.
(a) Eligible to Ineligible Status. If a Participant is
transferred from a class of Employees eligible to
participate in the Plan to a class of Employees ineligible
to so participate, such transferred Participant shall be
suspended from participation in the Plan. Suspension shall
mean that such Participant does not share in the allocation
of any Employer Contributions or forfeitures for the
portion of the Plan Year or Plan Years that the Participant
is a member of an ineligible class of Employees. A
suspended Participant shall, however, continue to receive
credit for Years of Vesting Service for service with the
Employer as a member of an ineligible class of Employees.
A suspended Participant's Account shall continue to be
adjusted for changes in market value pursuant to Section
2.06. Distribution of the Participant's Account shall be
made upon the Participant's termination of employment with
the Employer. If the suspended Participant is ever
transferred back to a class of Employees eligible to
participate in the Plan, the Participant shall immediately
recommence full participation in the Plan upon the date of
such transfer.
(b) Ineligible to Eligible Status. If an Employee of the
Employer is transferred from a class of Employees not
eligible to participate in this Plan to a class of
Employees eligible to participate in this Plan, such
Employee's period of employment with the Employer shall be
counted for vesting and eligibility purposes. After such
an Employee becomes a Participant, such Employee's rights
to an allocation of Employer Contributions and forfeitures
will be determined under the provisions of Section 2.03 and
will be based only on Compensation earned while in an
eligible class of Employees.
ARTICLE II
Contributions and Adjustments
to Accounts
2.01 Kinds of Contributions. The Plan permits the following five (5)
kinds of contributions:
(a) Elective Deferral Contributions as explained in Section
2.02(a);
(b) Qualified Matching Contributions as explained in Section
2.02(e);
(c) Qualified Nonelective Contributions as explained in Section
2.02(e);
(d) Nondiscretionary Employer Matching Contributions as
explained in Section 2.03(a); and
(e) Discretionary Employer Matching Contribution as explained
in Section 2.03(b).
The Trustee shall establish Accounts for each Participant. Each
Participant's Account shall reflect and account for the five (5)
different kinds of contributions which may be made under the
Plan. The maintenance of Accounts is only for accounting
purposes and segregation of the assets of the Plan to such
Accounts shall not be required.
2.02 Elective Deferrals.
(a) Amount. Each Plan Year a Participant may choose to enter
into a written salary reduction agreement with the
Employer. This agreement will apply to all payroll periods
within the Plan Year. The terms of the salary reduction
agreement shall provide that the Participant agrees to
accept a reduction in a salary from the Employer equal to
any whole percentage of his Compensation for the Plan Year
not less than one percent (1%) nor more than sixteen
percent (16%) of such Compensation. In addition, no
Participant shall be permitted to have any Elective
Deferrals made under the Plan during any calendar year in
excess of the dollar limitation contained in Code Section
402(g) in effect at the beginning of such calendar year.
The Employer shall contribute the Participant's Elective
Deferrals to the Plan for each Plan Year. A Participant
shall at all times have a 100 percent Vested Interest in
his Elective Deferrals, Qualified Nonelective
Contributions, and Qualified Matching Contributions and any
earnings on them.
(b) Deadline for Election. Each Participant who decides to
enter into a salary reduction arrangement must sign and
file with the Plan Administrator a written salary reduction
agreement on forms provided by the Plan Administrator. The
written agreement must be filed at least 14 days prior to
the change date for which it is to become effective. A
Participant may alter the percentage of his Elective
Deferrals on the change dates of January 1, April 1, July
1, or October 1. Except as provided in Section 2.02(c),
the salary reduction agreement may not otherwise be changed
without the written consent of the Plan Administrator.
(c) Discontinuance of Elective Deferrals. A Partici- pant
may elect at any time to discontinue his salary reduction
agreement for a Plan Year by filing a written notice of
discontinuance with the Plan Administrator on forms
provided by the Plan Administrator. The discontinuance
shall be effective for the first payroll period occurring
on or after the date that the election is received by the
Plan Administrator. A Participant who has discontinued his
salary reduction agreement for a Plan Year shall not be
permitted to enter into a new salary reduction agreement
until a change date specified in Section 2.02(b).
Effective January 1, 1994, a Participant whose employment
is terminated with the Employer shall be considered to have
automatically elected to discontinue his salary reduction
agreement as of the date that the termination becomes
effective. Compensation paid by the Employer to such
Participant after such effective date of termination shall
not be subject to any salary reduction.
(d) ADP Tests. The Plan Administrator or the Employer may
amend or revoke a salary reduction agreement with any
Participant at any time if either the Plan Administrator or
the Employer determines that such revocation or amendment
is necessary to prevent a Participant's annual addition
from exceeding permissible limits or to meet at least one
of the following discrimination tests of Section 401(k) of
the Code:
(1) 1.25 Test. The Actual Deferral Percentage ("ADP")
for Participants who are Highly Compensated Employees
for the Plan Year shall not exceed the ADP for
Participants who are Nonhighly Compensated Employees
for the Plan Year multiplied by 1.25; or
(2) 200% Test. The ADP for Participants who are Highly
Compensated Employees for the Plan Year shall not
exceed the ADP for Participants who are Nonhighly
Compensated Employees for the Plan Year multiplied by
2, provided that the ADP for Participants who are
Highly Compensated Employees does not exceed the ADP
for Participants who are Nonhighly Compensated
Employees by more than two (2) percentage points.
(3) Special Rules:
(i) The ADP for any Participant who is a Highly
Compensated Employee for the Plan Year and who is
eligible to have Elective Deferrals (and
Qualified Nonelective Contributions or Qualified
Matching Contribution, or both, if treated as
Elective Deferrals for purposes of the ADP test)
allocated to his accounts under two or more
arrangements described in Code Section 401(k),
that are maintained by the Employer, shall be
determined as if such Elective Deferrals (and, if
applicable, such Qualified Nonelective
Contributions or Qualifying Matching
Contributions, or both) were made under a single
arrangement. If a Highly Compensated Employee
participates in two or more cash or deferred
arrangements that have different Plan Years, all
cash or deferred arrangements ending with or
within the same calendar year shall be treated as
a single arrangement. Notwithstanding the
foregoing, certain plans shall be treated as
separate if mandatorily disaggregated under the
regulations under Code Section 401(k).
(ii) If this Plan satisfies the requirements of Code
Sections 401(k), 401(a), or 410(b) only if
aggregated with one or more other plans, or if
one or more other plans satisfy the requirements
of such sections of the Code only if aggregated
with this Plan, then this section shall be
applied by determining the ADP of Employees as if
all such plans were a single plan. For Plan
Years beginning after December 31, 1989, plans
may be aggregated in order to satisfy Code
Section 401(k) only if they have the same Plan
Year.
(iii) For purposes of determining the ADP of a
Participant who is a 5-percent owner or one of
the ten most highly paid Highly Compensated
Employees, the Elective Deferrals (and Qualified
Nonelective Contributions or Qualified Matching
Contributions, or both, if treated as Elective
Deferrals for purposes of the ADP test) and
Compensation of such Participant shall include
the Elective Deferrals (and, if applicable,
Qualified Nonelective Contributions and Qualified
Matching Contributions, or both) and Compensation
for the Plan Year of Family Members. Family
Members with respect to such Highly Compensated
Employee shall be disregarded as separate
employees in determining the ADP both for
Participants who are Nonhighly Compensated
Employees and for Participants who are Highly
Compensated Employees.
(iv) For purposes of determining the ADP test,
Elective Deferrals, Qualified Nonelective
Contributions and Qualified Matching
Contributions must be made before the last day of
the twelve-month period immediately following the
Plan Year to which contributions relate.
(v) The Employer shall maintain records sufficient to
demonstrate satisfaction of the ADP test and the
amount of Qualified Nonelective Contributions or
Qualified Matching Contributions, or both, used
in such test.
(vi) The determination and treatment of the ADP
amounts of any Participant shall satisfy such
other requirements as prescribed by the Secretary
of the Treasury.
(e) Qualified Nonelective and Qualified Matching
Contributions. The Employer may elect to make Qualified
Nonelective Contributions or Qualified Matching
Contributions, or both, to the extent necessary to meet the
ADP test or the ACP Test, or both, pursuant to regulations
under the Code. Subject to such other requirements as may
be prescribed by the Secretary of the Treasury, the amount
of such contributions taken into account as Elective
Deferrals shall be only those amounts necessary to meet the
ADP tests set forth in Section 2.02(d).
(f) Excess Elective Deferrals. A Participant may assign to
the Plan any Excess Elective Deferrals made during the
Participant's taxable year by notifying the Plan
Administrator on or before the March 1st following the
close of such taxable year of the amount of the Excess
Elective Deferrals to be assigned to the Plan. A
Participant is deemed to notify the Plan Administrator of
any Excess Elective Deferrals that arise by taking into
account only those Elective Deferrals made to this Plan and
any other plans of the Employer. Excess Elective
Deferrals, plus any income and minus any loss allocable
thereto shall be distributed no later than April 15 to any
Participant to whose Account Excess Elective Deferrals were
assigned for the preceding year and who claims Excess
Elective Deferrals for such taxable year.
Excess Elective Deferrals shall be adjusted for any income
or loss up to the date of distribution. The income or loss
allocable to the Excess Elective Deferrals is the sum of:
(1) income or loss allocable to the Participant's Elective
Deferral account for the taxable year multiplied by a
fraction. The numerator of the fraction is such
Participant's Excess Elective Deferrals for the year
and the denominator is the Participant's account
balance attributable to Elective Deferrals without
regard to any income or loss occurring during such
taxable year; and
(2) ten percent (10%) of the amount determined under (1)
multiplied by the number of whole calendar months
between the end of the Participant's taxable year and
the date of distribution, counting the month of
distribution if distribution occurs after the 15th of
such month.
(g) Excess Contributions. Excess Contributions, plus any
income and minus any loss allocable to them shall be
distributed no later than the last day of each Plan Year to
Participants to whose accounts such Excess Contributions
were allocated for the preceding Plan Year. If such excess
amounts are not distributed within 2-1/2 months after the last
day of the Plan Year in which such excess amounts arose, a
ten percent (10%) excise tax will be imposed on the
Employer maintaining the Plan with respect to such amounts.
Such distributions shall be made to Highly Compensated
Employees on the basis of the respective portions of the
Excess Contributions attributable to each of such
Employees. Excess Contributions of Participants who are
subject to the Family Member aggregation rules of Code
Section 414(q)(6) shall be allocated among the Family
Members in proportion to the Elective Deferrals (and
amounts treated as Elective Deferrals) of each Family
Member that is combined to determine the combined ADP. The
following shall also apply:
(1) Annual Addition. Excess Contributions (including
the amounts recharacterized) shall be treated as
annual additions under the Plan.
(2) Determination of Income or Loss. Excess
contributions shall be adjusted for any income or loss
up to the date of distribution. The income or loss
allocable to Excess Contributions is the sum of: (i)
income or loss allocable to the Participant's Elective
Deferral account (and, if applicable, the Qualified
Nonelective Contribution account or the Qualified
Matching Contributions account or both) for the Plan
Year multiplied by a fraction. The numerator of such
fraction is such Participant's Excess Contributions
for the year and the denominator is the Participant's
account balance attributable to Elective Deferrals
(and Qualified Nonelective Contributions or Qualified
Matching Contributions, or both, if any of such
contributions are included in the ADP test) without
regard to any income or loss occurring during such
Plan Year; and (ii) ten percent (10%) of the amount
determined under (i) multiplied by the number of whole
calendar months between the end the Plan Year and the
date of distribution, counting the month of
distribution if distribution occurs after the 15th of
such month.
(3) Accounting for Excess Contributions. Excess
Contributions shall be distributed from the
Participant's Elective Deferral account and Qualified
Matching Contribution account (if applicable) in
proportion to the Participant's Elective Deferrals and
Qualified Matching Contributions (to the extent used
in the ADP test) for the Plan Year. Excess
Contributions shall be distributed from the
Participant's Qualified Nonelective Contribution
account only to the extent that such Excess
Contributions exceed the balance in the Participant's
Elective Deferral account and Qualified Matching
Contribution account.
(h) Excess Aggregate Contributions:
(1) General. Notwithstanding any other provisions of this
Plan, Excess Aggregate Contributions, plus any income
and minus any loss allocable thereto, shall be
forfeited, if forfeitable, or if not forfeitable,
distributed no later than the last day of each Plan
Year to Participants to whose accounts such Excess
Aggregate Contributions were allocated for the
preceding Plan Year. Excess Aggregate Contributions
of Participants who are subject to the Family Member
aggregation rules of Section 414(q)(6) of the Code
shall be allocated among the Family Members in
proportion to the Matching Contributions (or amounts
treated as Matching Contributions) of each Family
Member that is combined to determine the combined ACP.
If such Excess Aggregate Contributions are distributed
more than 2-1/2 months after the last day of the Plan
Year in which such excess amounts arose, a ten percent
(10%) excise tax will be imposed on the Employer
maintaining the plan with respect to those amounts.
Excess Aggregate Contributions shall be treated as
annual additions under the Plan.
(2) Determination of Income or Loss. Excess Aggregate
Contributions shall be adjusted for any income or loss
up to the date of distribution. The income or loss
allocable to Excess Aggregate Contributions is the sum
of: (i) income or loss allocable to the Participant's
Matching Contribution account (if any, and if all
amounts therein are not used in the ADP test) and, if
applicable, Qualified Nonelective Contribution account
and Elective Deferral account for the Plan Year
multiplied by a fraction. The numerator of such
fraction is such Participant's Excess Aggregate
Contributions for the year and the denominator is the
Participant's Account balance(s) attributable to
Contribution Percentage Amounts without regard to any
income or loss occurring during such Plan Year; and
(ii) ten percent (10%) of the amount determined under
(i) multiplied by the number of whole calendar months
between the end of the Plan Year and the date of
distribution, counting the month of distribution if
distribution occurs after the 15th of such month.
(3) Forfeitures of Excess Aggregate Contributions.
Forfeitures of Excess Aggregate Contributions shall be
reallocated to the accounts of Nonhighly Compensated
Employees pursuant to the provisions of Section 2.05.
(4) Accounting for Excess Aggregate
Contributions. Excess Aggregate Contributions shall be
forfeited, if forfeitable or distributed on a pro rata
basis from Participant's Matching Contribution
account, and Qualified Matching Contribution account
(and, if applicable, the Participant's Qualified
Nonelective Contribution account or Elective Deferral
account, or both).
(i) Permissible Distributions. The Participant's Account
consisting of Elective Deferrals, Qualified Matching
Contributions, and Qualified Nonelective Employer
Contributions and earnings on such amounts may be
distributed after the Participant's attainment of age 59-1/2,
death, becoming Disabled or separation from service. The
Participant's Account shall be distributed in accordance
with Articles III, IV and V. Such amounts may also be
distributed upon the occurrence of any of the following
events:
(1) Plan Termination. Termination of the Plan by the
Employer without the establishment of another defined
contribution plan, other than an employee stock
ownership plan (as defined in Section 4975(e) or
Section 409 of the Code) or a simplified employee
pension plan as defined in Code Section 408(k).
(2) Disposition of Assets. The disposition by the
Employer to an unrelated corporation of substantially
all of the assets (within the meaning of Code Section
409(d)(2)) used in a trade or business of the Employer
if such corporation continues to maintain this Plan
after the disposition, but only with respect to
employees who continue employment with the corporation
acquiring such assets.
(3) Disposition of Subsidiary. The disposition by the
Employer to an unrelated entity of such corporation's
interest in a subsidiary (within the meaning of
Section 409(d)(3) of the Code) if such corporation
continues to maintain this Plan, but only with respect
to employees who continue employment with such
subsidiary.
(4) Hardship. The hardship of the Participant as described
in Section 3.05.
All distributions that may be made pursuant to one or more
of the foregoing distributable events are subject to the
spousal and participant consent requirements (if
applicable) contained in Sections 411(a)(11) and 417 of the
Code. In addition, distributions after March 31, 1988,
that are triggered by paragraphs (1), (2), or (3) above
must be made in a lump sum.
2.03 Employer Contributions.
For each Plan Year the Employer shall make the Employer
Contributions described in Section 2.03(a) and may make the
Employer Contributions described in Section 2.03(b):
(a) Matching Employer Contribution.
(1) General. For each Plan Year during which the Employer
does not have negative retained earnings, the Employer
shall make a Matching Employer Contribution on or
before the time for filing the Employer's tax return
for such Plan Year. The amount of any such Matching
Employer Contribution shall be equal to one hundred
percent (100%) of the first three percent (3%) of
Compensation deferred by Qualifying Participants who
made Elective Deferrals under the salary reduction
agreements described in Section 2.02 for the Plan
Year. The amount shall be calculated before
contributions to the Plan and prior to deductions for
taxes on income. Calculation shall be done in
accordance with generally accepted accounting
principles. Any Matching Employer Contributions must
meet the nondiscrimination requirements of Code
Section 401(a)(4) and the Average Contribution
Percentage (ACP) test of Code Section 401(m).
The ACP for Participants who are Highly Compensated
Employees for each Plan Year and the ACP for
Participants who are Non-Highly Compensated Employees
for the same Plan Year must satisfy one of the
following tests:
(i) The ACP for Participants who are Highly
Compensated Employees for the Plan Year shall not
exceed the ACP for Participants who are
Non-highly Compensated Employees for the same
Plan Year multiplied by 1.25; or
(ii) The ACP for Participants who are Highly
Compensated Employees for the Plan Year shall not
exceed the ACP for Participants who are
Non-highly Compensated Employees for the same
Plan Year multiplied by two (2), provided that
the ACP for Participants who are Highly
Compensated Employees does not exceed the ACP for
Participants who are Non-highly compensated
Employees by more than two (2) percentage points.
(2) Special Rules. The following special rules shall
apply:
(i) If the sum of the ADP and ACP of those Highly
Compensated Employees subject to either or both
tests under this Plan exceeds the Aggregate
Limit, then the ACP of those Highly Compensated
Employees will be reduced (beginning with such
Highly Compensated Employee whose ACP is the
highest) so that the limit is not exceeded. The
amount by which each Highly Compensated
Employee's Contribution Percentage Amounts is
reduced shall be treated as an Excess Aggregate
Contribution. The ADP and ACP of the Highly
Compensated Employees are determined after any
corrections required to meet the ADP and ACP
tests. Multiple use does not occur if both the
ADP and ACP of the Highly Compensated Employees
does not exceed 1.25 multiplied by the ADP and
ACP of the Non-highly Compensated Employees.
(ii) For purposes of this section, the Contribution
Percentage for any Participant who is a Highly
Compensated Employee who is eligible to have
Contribution Percentage Amounts allocated to his
account under two or more plans described in
Section 401(a) of the Code, or arrangements
described in Section 401(k) of the Code that are
maintained by the Employer, shall be determined
as if the total of such Contribution Percentage
Amounts was made under each plan. If a Highly
Compensated Employee participates in two or more
cash or deferred arrangements that have different
plan years, all cash or deferred arrangements
ending with or within the same calendar year
shall be treated as a single arrangement.
Notwithstanding the foregoing, certain plans
shall be treated as separate if mandatorily
disaggregated under regulations under Code
Section 401(k).
(iii) If this Plan satisfies the requirements of
Sections 401(m), 401(a)(4) or 410(b) of the Code
only if aggregated with one or more other plans,
or if one or more other plans satisfy the
requirements of such sections of the Code only if
aggregated with this Plan, then this section
shall be applied by determining the Contribution
Percentage of Employees as if all such plans were
a single plan. For plan years beginning after
December 31, 1989, plans may be aggregated in
order to satisfy Section 401(m) of the Code only
if they have the same Plan Year.
(iv) For purposes of determining the Contribution
percentage of a Participant who is a five-percent
owner or one of the ten most highly-paid Highly
Compensated Employees, the Contribution
Percentage Amounts and Compensation of such
Participant shall include the Contribution
Percentage Amounts and Compensation for the Plan
Year of Family Members. Family Members, with
respect to Highly Compensated Employees, shall be
disregarded as separate employees in determining
the Contribution Percentage both for Participants
who are Non-highly Compensated Employees and for
Participants who are Highly Compensated
Employees.
(v) For purposes of determining the Contribution
Percentage test, Matching Contributions and
Qualified Nonelective Contributions will be
considered made for a Plan Year if made no later
than the end of a twelve-month period beginning
on the day after the close of the Plan Year.
(vi) The Employer shall maintain records sufficient to
demonstrate satisfaction of the ACP test and the
amount of Qualified Nonelective Contributions or
Qualified matching Contributions, or both, used
in such test.
(vii) The determination and treatment of the
Contribution Percentage of any Participant shall
satisfy such other requirements as may be
prescribed by the Secretary of the Treasury.
(b) Discretionary Matching Contributions.
(1) In addition to the Matching Employer Contribution for
a Plan Year set forth in Section 2.02(a), for each
Plan Year in which the Employer has a Net Profit, the
Employer, in its sole discretion, may make a
discretionary Matching Contribution by increasing the
percentage of its Matching Employer Contribution on
the first three percent (3%) of Compensation deferred
by Qualifying Participants who made Elective Deferrals
under the salary reduction agreements described in
Section 2.02 for the Plan Year.
(2) For each Plan Year in which the Employer has negative
retained earnings, the Employer may, in its sole
discretion, make a Matching Employer Contribution to
Qualifying Participants who made Elective Deferrals
under the salary reduction agreements described in
Section 2.02 for the Plan Year in such amounts as the
Employer shall determine.
(c) Special Allocation Rules.
(1) For allocation purposes, a Qualifying Participant is a
Participant who:
(i) is an Employee of the Employer on the last day of
the Plan Year,
(ii) has died during the Plan Year,
(iii) became Disabled during the Plan Year,
(iv) terminated employment with the Employer during
the Plan Year after attainment of Normal
Retirement Age, or
(v) terminated employment with the Employer during
the Plan Year due to the sale by the Employer to
an entity that is not an Affiliated Employer of a
subsidiary or unincorporated division whose
employees were Participants in the Plan prior to
such sale.
(2) The provisions of this paragraph shall be effective
for a Plan Year if, but for the application of this
paragraph, the Plan would fail to satisfy the coverage
rules of either Code Section 401(a)(26) or Code
Section 410(b) for the Plan Year. In such event, the
requirements that a Participant must be an be employed
by the Employer on the last day of the Plan Year in
order to receive an allocation shall be disregarded by
allocating Employer Contributions to Participants who
would otherwise be excluded on the following basis:
(i) First, an allocation of the Employer
Contributions shall be made to the Accounts of
certain Participants who were not Highly
Compensated Employees and who were employed by
the Employer on the last day of the Plan Year.
The allocation shall be made to such Participants
one at a time in order, according to the number
of Hours of Service credited to such Participants
during the Plan Year, beginning with the
Participant credited with the largest number of
Hours of Service for the Plan Year. The
allocation shall continue until the coverage
rules are satisfied or until all such
Participants have received an allocation,
whichever occurs first.
(ii) If the Plan fails to satisfy the coverage rules
for a Plan Year after the application of the
preceding subparagraph, then an allocation of the
Employer Contributions shall be made to the
Accounts of certain Participants who were
Employees during the Plan Year but who were not
employed by the Employer on the last day of the
Plan Year. The allocation shall be made one at a
time in the same order and manner described in
the preceding subparagraph.
(3) A Participant whose employment is terminated with the
Employer shall be considered to have automatically
elected to discontinue his salary reduction agreement
as of the date that the termination becomes effective.
Compensation paid by the Employer to such Participant
after such effective date of termination shall not be
subject to any salary reduction.
(d) Maximum Amount of Employer Contributions. For purposes of
determining the maximum amount which may be contributed for
a Plan Year, both the Elective Deferrals permitted by
Section 2.02(a) and the Employer Contributions permitted by
Section 2.02 and this Section 2.03 shall be considered
together. In no event, however, shall the Employer
contribute more than the maximum amount for such Plan Year
which may be contributed on a deductible basis for federal
income tax purposes including any deductible amounts which
may be carried forward or backward under the applicable
provisions of the Code. Contributions for each Plan Year
shall be paid not later than the latest permissible date
for the making of such contributions on a deductible basis
for such Plan Year for federal income and excess profits
tax purposes as may be prescribed from time to time by the
applicable provisions of the Code. Except as otherwise
specified, the Employer shall make all contributions to the
Plan without regard to current or accumulated earnings and
profits for the taxable year or years ending with or within
such Plan Year. Notwithstanding the foregoing, the Plan
shall continue to be designed to qualify as a profit
sharing plan for purposes of Code Sections 401(a), 402, 412
and 417. The Employer's determination of its contributions
shall be binding on all Participants, the Trustee and the
Administrator. The Trustee shall have no right or duty to
inquire into the amount of the Employer Contributions or
the method used in determining the amount of such
contribution but shall be accountable only for the funds
actually received by it.
2.04 Employee Contributions. No voluntary contributions by
Participants shall be permitted other than Elective
Deferrals.
2.05 Forfeitures. Any forfeitures allocable for a Plan Year shall
first be used to satisfy the amount of any Employer Matching
Contributions for such Plan Year or for future Plan Years.
2.06 Adjustment of Accounts.
(a) General. As of the end of each Plan Year, or more
frequently as determined by the Plan Administrator, the
Trustee shall adjust the net credit balances in the
Accounts of Participants in the Trust, upward or downwards
pro rata, so that the aggregate of such net credit balances
will equal the net worth of the trust fund as of the
valuation date, using fair market values as determined by
the Trustee and reported to the Plan Administrator, after
such net worth has been reduced by any expenses,
withdrawals, distributions and transfers chargeable to the
Trust which have been incurred but not yet paid. All
determinations made by the Trustee with respect to fair
market values and net worth shall be made in accordance
with generally accepted principles of trust accounting and
such determinations when so made by the Trustee and any
determinations by the Plan Administrator based on them
shall be conclusive and binding upon all persons having an
interest under the Plan. If fair market value is not
available for certain assets, the Trustee shall use fair
appraised value or such other valuation which, in the
opinion of the Trustee, best reflects the value of such
Plan assets.
(b) Special Valuations.
(1) If any of the assets of the Plan are invested with an
insurance company or other investment manager, such
investment manager shall render an accounting with
respect to such Plan assets. Such accounting shall be
delivered to the Trustee and the Plan Administrator as
soon as feasible after the valuation date or dates
established by the Plan Administrator. The accounting
shall include complete information about all amounts
for which such investment manager is responsible.
(2) If the Plan Participants are directing the investment
of all or a portion of their Accounts, the Trustee
shall allocate earnings and losses for the directed
portion of each Participant's Account based on those
investments selected by each Plan Participant.
2.07 Limitations on Annual Addition to Account. The following rules
shall apply concerning the maximum amount which may be allocated
to a Participant under the Plan:
(a) For purposes of the plan, "Annual Addition" shall mean the
sum of the following amounts allocated to a Participant's
Account for the Limitation Year:
(1) Employer contributions,
(2) Employee contributions,
(3) Forfeitures, and
(4) Amounts allocated, after March 31, 1984, to an
individual medical account, as defined in Section
415(l)(2) of the Code, which is part of a pension or
annuity plan maintained by the Employer and amounts
derived from contributions paid or accrued after
December 31, 1985, in taxable years ending after such
date, which are attributable to post-retirement
medical benefits, allocated to the separate account of
a key employee, as defined in Section 419A(d)(3) of
the Code, under a welfare benefit fund, as defined in
Section 419(e) of the Code, maintained by the
Employer.
(b) The maximum Annual Addition that may be contributed or
allocated to a Participant's account under the Plan for any
Limitation Year shall not exceed the lesser of:
(1) the Defined Contribution Dollar Limitation, or
(2) 25 percent of the Participant's compensation, within
the meaning of Section 415(c)(3) of the Code for the
Limitation Year.
(c) The compensation limitation referred to in Section
2.07(b)(ii) shall not apply to any contribution for medical
benefits (within the meaning of Code Section 401(h) or
Section 419A(f)(2)) after separation from service which is
otherwise treated as an Annual Addition under Section
415(l)(1) or Section 419A(d)(2) of the Code.
(d) For purposes of Section 2.07(b), "Defined Contribution
Dollar Limitation" shall mean $30,000 or, if greater, one-
fourth (1/4) of the defined benefit dollar limitation set
forth in Code Section 415(b)(1) as in effect for the
Limitation Year.
(e) If, due to reasonable error in estimating a Participant's
annual compensation, or due to the allocation of
forfeitures or under such other limited facts and
circumstances which the Commissioner of Internal Revenue
finds justify the availability of relief, any annual
addition in excess of the limitations set forth in this
Section 2.07 will be disposed of as follows:
(1) Any Elective Deferrals made by the Participant will be
returned to the Participant as permitted by Treas.
Reg. Section 1.415-6(b)(6)(iv).
(2) If after the application of paragraph (1) an excess
amount still exists and the Participant is covered by
the Plan at the end of the Limitation Year, the excess
amount in the Participant's Account will be used to
reduce Employer Contributions (including any
allocation of forfeitures) for such Participant in the
next Limitation Year, and each succeeding Limitation
Year if necessary.
(3) If after the application of paragraph (2) an excess
amount still exists and the Participant is not covered
by the Plan at the end of the Limitation Year, the
excess amount will be held unallocated in a suspense
account. The suspense account will be applied to
reduce future Employer Contributions for all remaining
Participants in the next Limitation Year, and each
succeeding Limitation Year if necessary.
(4) If a suspense account is in existence at any time
during a Limitation Year pursuant to this Section, it
will not participate in the allocation of the Plan's
investment gains and losses. If a suspense account is
in existence at any time during a particular
Limitation Year, all amounts in the suspense account
must be allocated and reallocated to Participants'
Accounts before any Employer Contributions may be made
to the Plan for the Limitation Year. Excess amounts
may not be distributed to Participants or former
Participants.
ARTICLE III
Retirement, Disability and Hardship Benefits
3.01 Retirement and Disability Distributions. A Participant shall
be entitled to distribution of his Account upon the occurrence
of any one of the following events:
(a) Retirement from the service of the Employer after
attainment of Normal Retirement Age.
(b) Retirement from the service of the Employer as a result of
becoming Disabled.
The amount of the Account to be distributed to the Participant
shall be determined as of the day of the Plan Year immediately
preceding the date the distribution is scheduled to take place.
The amount of the distribution shall not be entitled to any
share of the earnings of the Plan or interest from the period
between such valuation date and the date of distribution.
However, the amount of the distribution shall include any
Elective Deferrals made by the Participant between the valuation
date and the date of distribution. A Participant's right to his
Account shall be nonforfeitable within the meaning of Code
Section 411(a)(1) upon either attaining Normal Retirement Age
while in the service of the Employer or becoming Disabled while
in the service of the Employer.
3.02 Form of Benefit Payment. The Account shall be paid to the
Participant in one of the following forms as the Participant
shall select:
(a) A single sum, or
(b) Equal monthly, quarterly, semi-annual, or annual
installments from the Plan.
(c) Direct transfer of the Participant's Account by the Trustee
to the trustee of another retirement plan which is
qualified to receive such a transfer under the relevant
provisions of the Code or a Direct Rollover pursuant to the
provisions of Article VI.
If the Participant's Account has investments acquired by the
Plan pursuant to the Participant's exercise of a power of
self-direction, the distribution to the Participant of his
vested Account shall include all such investments or the net
proceeds of such investments.
3.03 Commencement of Benefits. Unless the Participant otherwise
elects by submitting to the Plan Administrator a written
statement, signed by the Participant which describes the benefit
and a later date on which the payment of such benefits shall
commence, payment of benefits shall begin no later than the one
hundred twentieth (120th) day after the close of the Plan Year
in which the Participant becomes entitled to distribution of
benefits under Section 3.01. There are four exceptions to this
rule:
(a) If the Plan Administrator has been unable to locate the
Participant after making reasonable efforts to do so, to
the extent not prohibited by the Code or ERISA and valid
regulations thereunder, the beginning of such distribution
may be delayed until 60 days after such Participant has
been located. Such distribution will be retroactive to 60
days after the end of the Plan Year in which retirement or
disability occurs. No interest or allocation of earnings
shall be due to a Participant for the period commencing on
the valuation date described in Section 3.01 and ending on
the date the distribution is made.
(b) If a Participant has not been located within seven (7)
years from the date that such Participant's benefits under
this Plan first become payable, the Participant's Account
shall be deemed abandoned and shall be used to reduce
future Employer Contributions to the Plan. If at any time
a Participant whose Account was deemed abandoned and so
used is located, the Employer shall restore the amount of
such Account to the Trustee for distribution to the
Participant. The Participant shall not be entitled to any
interest or allocation of earnings on such amount from the
date of abandonment to the date of distribution.
(c) The Participant may elect to receive a distribution of the
Participant's Account at any time after the Participant's
termination of employment with the Employer. If the value
of a Participant's vested Account balance derived from
Employer and Employee Contributions either exceeds
$3,500.00 as of the day of the Plan Year on which the
Participant's service terminated or at the time of any
prior distribution exceeded $3,500.00, and the Account
balance is immediately distributable, the Participant must
consent to any distribution of such Account balance. An
Account Balance is immediately distributable if any part of
the Account Balance could be distributed to the Participant
before the Participant attains or would have attained the
later of Normal Retirement Age or age 62. The consent of
the Participant shall be obtained in writing within the
90-day period ending on the annuity starting date. The
annuity starting date is the first day of the first period
for which an amount is paid as an annuity or in any other
form. The Plan Administrator shall notify the Participant
(or surviving spouse) of the right to defer any
distribution until the Participant's Account balance is no
longer immediately distributable. Such notification shall
include a general description of the material features, and
an explanation of the relative values of, the optional
forms of benefit available under the Plan in a manner that
would satisfy the notice requirements of Code Section
417(a)(3), and shall be provided no less than thirty (30)
days and no more than ninety (90) days prior to the annuity
starting date.
(d) No Participant will be permitted to defer the commencement
of benefits beyond the April 1st in the calendar year
immediately following the calendar year in which the
Participant attains age seventy and one-half (70-1/2).
3.04 Hardship Withdrawal. Distributions of Elective Deferrals made
by the Participant (and any earnings credited to a Participant's
Account as of the end of the last Plan Year ending before July
1, 1989) may be made on account of financial hardship if the
distribution is necessary in light of the immediate and heavy
financial needs of the Participant. Such a distribution shall
not exceed the amount required to meet the immediate financial
need created by the hardship and may not be made to the extent
that other financial resources of the Participant are reasonably
available.
(a) A distribution will be deemed to be made on account of an
immediate and heavy financial need of the Participant only
if the distribution is on account of:
(1) Expenses incurred or necessary for medical care,
described by Code Section 213(d), of the Participant,
the Participant's spouse, or any dependents of the
Participant (as defined in Code Section 152);
(2) The need to prevent the eviction of the Participant
from his principal residence or foreclosure on the
mortgage of the Participant's principal residence;
(3) Payment of tuition for the next semester or quarter of
post-secondary education for the Participant, the
Participant's spouse, children, or dependents; or
(4) Purchase (excluding mortgage payments) of a principal
residence for the Participant.
(b) A distribution will be treated as necessary to satisfy an
immediate and heavy financial need of the Participant if
all of the following requirements are satisfied:
(1) The distribution is not in excess of the amount of the
immediate and financial need of the Participant
(including amounts necessary to pay any federal, state
or local income tax or penalties reasonably
anticipated to result from the distribution;
(2) The Employee has obtained all distributions, other
than hardship distributions, and all nontaxable loans
currently available under all plans maintained by the
Employer;
(3) The Participant's Elective Deferral contributions will
be suspended for twelve (12) months after receipt of
the hardship distribution and may resume as of the
first day of the calendar quarter (January 1, April 1,
July 1 or October 1) immediately following the
expiration of such twelve (12) month suspension
period;
(4) The Participant may not make Elective Deferrals for
the Participant's taxable year immediately following
the taxable year of the hardship distribution in
excess of the applicable limit under Code Section
402(g) for such next taxable year less the amount of
such Participant's Elective Deferrals for the taxable
year of the hardship distribution; and
(5) The Participant shall not be eligible to receive a
Matching Employer Contribution for the Plan Year
during which the Participant receives a hardship
distribution.
(c) The determination of existence of financial hardship, and
the amount required to be distributed to meet the need
created by the hardship, shall be made by a person or
persons designated by the Plan Administrator.
(d) All determinations regarding financial hardship shall be
made in accordance with written procedures that are
established by the Plan Administrator and applied in a
uniform and nondiscriminatory manner. Such written
procedures shall specify the requirements for requesting
and receiving distributions on account of hardship,
including what forms must be submitted and to whom.
(e) Processing of applications and distributions of amounts
under this Section, on account of a bona fide financial
hardship, must be made as soon as administratively
feasible.
ARTICLE IV
Death Benefits
4.01 Amount of Death Benefit. The Beneficiary of a Participant who
dies prior to receiving benefits under the Plan shall be
entitled to receive death benefits as provided in this Article
IV. A Beneficiary shall be 100% vested in a deceased
Participant's Account if the Participant dies while in the
service of the Employer, or if a retired or disabled Participant
dies after termination of employment but before the commencement
of any retirement or disability benefits under this Plan. A
Beneficiary of a Section 5.01 terminated Participant who dies
after termination of employment (but prior to payment of
benefits) shall be vested in the Account of such Participant in
the same percentage that such deceased Participant was vested
pursuant to the provisions of Section 5.01 of the Plan.
4.02 Payment of Death Benefit. The amount of the Account
payable to a Beneficiary under this Article IV shall be
determined as of the day of the Plan Year immediately preceding
the date the distribution is scheduled to take place. The amount
of the distribution shall not be entitled to any share of the
earnings of the Plan or interest from the period between such
valuation date and the date of distribution. However, the
amount of the distribution shall include any Elective Deferrals
made by the Participant between the valuation date and the date
of distribution. The time for payment of benefits to the
Beneficiary of a deceased Participant shall be governed by the
provisions of Article VI. The form of such benefit shall be a
lump sum distribution unless the Beneficiary is the
Participant's surviving spouse. If the Beneficiary is the
Participant's surviving spouse, such Beneficiary may elect
either of the options set forth in Section 3.02. If the
Participant's Account has investments acquired by the Plan
pursuant to the Participant's exercise of a power of
self-direction, the distribution to the Beneficiary of the
Participant's vested Account shall include all such investments
or the net proceeds of such investments.
4.03 Beneficiary Designations. The Participant's vested
Account will automatically be paid to the Participant's
surviving spouse. However, if there is no surviving spouse or
if the surviving spouse has already consented to another
Beneficiary in a writing witnessed by a plan representative or
notary public, then the Participant's vested Account will be
paid to the Participant's designated Beneficiary. The term
"surviving spouse" includes the former spouse of a Participant
to the extent provided under a qualified domestic relations
order as described in Section 414(p) of the Code. Subject to
the spousal consent provisions of this Section 4.03, each
Participant shall have the right to designate and change his
Beneficiary or contingent Beneficiary. Such right shall be
exercised by the Participant in writing on forms provided by the
Plan Administrator. If there is no surviving spouse and the
Participant has not made an effective Beneficiary designation,
then the Participant's surviving children, both natural and
adopted, shall be deemed to be equal beneficiaries. If there
are no surviving children, the estate of the Participant shall
be the Beneficiary.
ARTICLE V
Termination Benefits
5.01 Vesting Schedule.
(a) Participation Prior To January 1, 1990. This provision
shall apply to a Participant who became a Participant in
the Plan prior to January 1, 1990. Except as provided in
Section 5.04, each such Participant shall have at all times
a 100% vested interest in such Participant's Account.
(b) Participation after December 31, 1989. This provision
shall apply to a Participant who becomes a Participant in
the Plan after December 31, 1989. Each such Participant
unless he dies, becomes Disabled or terminates employment
after Normal Retirement Age shall have a Vested Interest in
his Account derived from Employer Contributions pursuant to
Section 2.03 in accordance with the following schedule:
YEARS OF VESTING SERVICE VESTED INTEREST IN
ACCOUNT
Less than 1 year 0%
1 year but less than 2 years 20%
2 years but less than 3 years 40%
3 years but less than 4 years 60%
4 years but less than 5 years 80%
5 years or more 100%
5.02 Determination of Vested Benefit. The amount of the
Participant's vested Account shall be determined as of the last
day of the Plan Year in which the Participant's termination of
employment takes place unless the Trustee has selected a more
recent valuation date pursuant to Section 2.06. The amount of
the distribution shall not be entitled to any share of the
earnings of the Plan or interest from the period between such
valuation date and the date of distribution. However, the
amount of the distribution shall include any Elective Deferrals
made by the Participant between the valuation date and the date
of distribution. The value of both the vested and nonvested
portions of the Account of such a terminated Participant shall
be continue to be maintained and adjusted pursuant to Section
2.06 until the vested portion of such Account is paid to the
Participant under the provisions of Section 5.03, and until the
nonvested portion of the Account is redistributed pursuant to
the forfeiture provisions of this Section 5.02 and Section 2.05.
If a Participant is not reemployed by the end of the fifth Plan
Year immediately following the Plan Year in which termination of
employment took place and no distribution of his vested Account
balance has taken place, the nonvested portion of such
Participant's Account shall be closed and the forfeiture shall
be used as of the end of such Plan Year as provided in Section
2.05. However, if a distribution of the Participant's vested
Account takes place, the value of the nonvested portion of the
Participant's Account shall be forfeited as of the last day of
the Plan Year in which such distribution occurs. For purposes
of this Section, if the value of the Participant's vested
Account balance is zero, the Participant will be deemed to have
received a distribution of such vested Account balance. If:
(a) a Section 5.01 terminated Participant is re-employed by the
Employer at any time prior to the end of the fifth Plan
Year following the Plan Year in which the distribution of
the Participant's vested Account occurs; and
(b) such Section 5.01 terminated Participant received a
distribution of a portion of his Account which was less
than the value of said Account derived from Employer
Contributions; and
(c) such Participant repays the full amount that was received
before the end of the fifth (5th) Plan Year following the
Plan Year in which the distribution of the Participant's
vested Account occurred,
then the amount of such Participant's Account shall be restored
to the amount on the date of distribution and such Participant
shall be vested therein in accordance with the vesting schedule
previously set forth in Section 5.01. If a Participant is deemed
to receive a distribution pursuant to this Section (both vested
and nonvested portions), and the Participant resumes employment
covered under this Plan before the end of the fifth (5th)
consecutive Plan Year in which the Participant's termination of
employment took place, the amount of such Participant's Employer
derived Account balance will be restored to the amount on the
date of such deemed distribution upon the reemployment of such
Participant.
The Participant's repayment period will commence after each
termination of employment until the Participant has no service
with the Employer for five (5) consecutive Plan Years. The
repayment period of a Participant who is entitled to Hours of
Service credit due to maternity or paternity leave will commence
after each termination of employment until the Participant has
no service with the Employer for six (6) consecutive Plan Years.
5.03 Payment of Vested Interest.
(a) General Rule. Subject to the consent requirements of
Section 5.03(c), a Participant's vested Account shall be
paid to the Participant no later than one hundred twenty
(120) days after the end of the Plan Year in which the
Participant's termination of employment takes place. If the
Plan Administrator has been unable to locate the
Participant after making reasonable efforts to do so, to
the extent not prohibited by the Code or ERISA and valid
regulations thereunder, the beginning of such distribution
may be delayed until 60 days after such Participant has
been located. If a Participant does not consent to a
distribution, the Participant shall have a right to elect
to receive a distribution in any subsequent Plan Year
within one hundred twenty (120) days after the end of such
Plan Year. The Participant may elect to receive such
distribution in any of the ways specified in Section 3.02.
The amount of the Account to be distributed to the
Participant shall be determined as of the day of the Plan
Year immediately preceding the date the distribution is
scheduled to take place. The amount of the distribution
shall not be entitled to any share of the earnings of the
Plan or interest from the period between such valuation
date and the date of distribution.
(b) Cash-Out of Small Accounts. If a Participant terminates
service, and the value of the Participant's vested Account
derived from Employer and Employee Contributions is not
greater than $3,500 as of the day of the Plan Year on which
the Participant's service terminated, the Participant will
receive a distribution of the value of the entire vested
portion of such Account in a lump sum and the nonvested
portion will be treated as a forfeiture. Such distribution
will be made no later than one hundred twenty (120) days
after the end of the Plan Year in which the Participant's
termination of service took place. The amount of the
Account to be distributed to the Participant shall be
determined as of the day of the Plan Year immediately
preceding the date the distribution is scheduled to take
place. The amount of the distribution shall not be entitled
to any share of the earnings of the Plan or interest from
the period between the valuation date and the date of
distribution.
(c) Consent For Certain Distributions. If the value of a
Participant's vested Account balance derived from Employer
and Employee Contributions either exceeds $3,500.00 as of
the day of the Plan Year on which the Participant's service
terminated or at the time of any prior distribution
exceeded $3,500.00, and the Account balance is immediately
distributable, the Participant must consent to any
distribution of such Account balance. An Account Balance
is immediately distributable if any part of the Account
Balance could be distributed to the Participant before the
Participant attains or would have attained the later of
Normal Retirement Age or age 62. The consent of the
Participant shall be obtained in writing within the 90-day
period ending on the annuity starting date. The annuity
starting date is the first day of the first period for
which an amount is paid as an annuity or in any other form.
The Plan Administrator shall notify the Participant (or
surviving spouse) of the right to defer any distribution
until the Participant's Account balance is no longer
immediately distributable. Such notification shall include
a general description of the material features, and an
explanation of the relative values of, the optional forms
of benefit available under the Plan in a manner that would
satisfy the notice requirements of Code Section 417(a)(3),
and shall be provided no less than thirty (30) days and no
more than ninety (90) days prior to the annuity starting
date.
(d) Exceptions to Consent Requirements. Notwithstanding the
provisions of Section 5.03(c), the consent of the
Participant shall not be required to the extent that a
distribution is a cash-out described in Section 5.03(b) or
is required to satisfy Section 401(a)(9) or Section 415 of
the Code. In addition, upon termination of this Plan if
the Plan does not offer an annuity option (purchased from a
commercial provider), the Participant's Account Balance
may, without the Participant's consent, be distributed to
the Participant or transferred to another defined
contribution plan (other than an employee stock ownership
plan as defined in Section 4975(e)(7) of the Code) within
the same controlled group.
(e) Exclusion for Certain Employee Contributions. For purposes
of determining the applicability of the foregoing consent
requirements to distributions made before the first day of
the first Plan Year beginning after December 31, 1988, the
Participant's vested Account balance shall not include
amounts attributable to accumulated deductible Employee
Contributions within the meaning of Code Section of the
Code.
(f) Participant-Directed Investments. If the Participant's
Account has investments acquired by the Plan pursuant to
the Participant's exercise of a power of self-direction,
the distribution to the Participant of his vested Account
shall include all such investments or the net proceeds of
such investments.
ARTICLE VI
Distribution Requirements
6.01 General Rules.
(a) The requirements of this Article shall apply to any
distribution of a Participant's interest and will take
precedence over any inconsistent provisions of this Plan.
Unless otherwise specified, the provisions of this Article
apply to calendar years beginning after December 31, 1984.
(b) All distributions required under this Article shall be
determined and made in accordance with the proposed
regulations under Code Section 401(a)(9), including the
minimum distribution incidental benefit requirement of
Section 1.401(a)(9)-2 of the proposed regulations.
6.02 Required Beginning Date. The entire interest of a participant
must be distributed or begin to be distributed no later than the
Participant's required beginning date.
6.03 Limits On Distribution Periods. As of the first distribution
calendar year, distributions, if not made in a single sum, may
only be made over one of the following periods
(a) the life of the Participant,
(b) the life of a Participant and a designated Beneficiary,
(c) a period certain not extending beyond the life expectancy
of the Participant, or
(d) a period certain not extending beyond the joint life and
last survivor expectancy of the Participant and a
designated Beneficiary.
No other forms of distribution such as an annuity shall be
permitted.
6.04 Determination of Annual Distribution Amount. If the
Participant's interest is to be distributed in other than a
single sum, the following minimum distribution rules shall apply
on or after the required beginning date:
(a) If a Participant's vested Account balance is to be
distributed over (1) a period not extending beyond the life
expectancy of the Participant or the joint life and last
survivor expectancy of the Participant and the
Participant's designated Beneficiary or (2) a period not
extending beyond the life expectancy of the designated
Beneficiary, the amount required to be distributed for each
calendar year, beginning with distributions for the first
distribution calendar year, must at least equal the
quotient obtained by dividing the Participant's benefit by
the applicable life expectancy.
(b) The amount to be distributed each year, beginning with
distributions for the first distribution calendar year
shall not be less than the quotient obtained by dividing
the Participant's benefit by the lesser of (1) the
applicable life expectancy or (2) if the Participant's
spouse is not the designated Beneficiary, the applicable
divisor determined form the table set forth in Q&A-4 of
Section 1.401(a)(9)-2 of the Proposed Regulations.
Distributions after the death of the Participant shall be
distributed using the applicable life expectancy in Section
6.04(a) as the relevant divisor without regard to Proposed
Regulation Section 1.401(a)(9)-2.
(c) The minimum distribution required for the Participant's
first distribution calendar year must be made on or before
the Participant's required beginning date. The minimum
distribution for other calendar years, including the
minimum distribution for the distribution calendar year in
which the Participant's required beginning date occurs,
must be made on or before December 31 of the distribution
calendar year.
6.04 Death Distribution Provisions.
(a) Distribution Beginning Before Death. If the Participant
dies after distribution of his interest has begun, the
remaining portion of such interest will continue to be
distributed at least as rapidly as under the method of
distribution being used prior to the Participant's death.
(b) Distribution Beginning After Death. If the Participant
dies before distribution of his interest begins,
distribution of the Participant's entire interest shall be
completed by December 31 of the calendar year containing
the fifth (5th) anniversary of the Participant's death
except to the extent that an election is made to receive
distributions in accordance with (1) or (2) below:
(1) If any portion of the Participant's interest is
payable to a designated Beneficiary, distributions may
be made over the life or over a period certain not
greater than the life expectancy of the designated
beneficiary commencing on or before December 31 of the
calendar year immediately following the calendar year
in which the Participant died; or
(2) If the designated Beneficiary is the Participant's
Surviving Spouse, the date distributions are required
to begin shall not be earlier than the later of (1)
December 31 of the calendar year immediately following
the calendar year in which the Participant died and
(2) December 31 of the calendar year in which the
Participant would have attained age 70-1/2.
If the Participant has not made an election pursuant to
this Section 6.04 by the time of his death, the
Participant's designated beneficiary must elect the method
of distribution no later than the earlier of (1) December
31 of the calendar year in which distributions would be
required to begin under this Section, or (2) December 31 of
the calendar year which contains the fifth (5th)
anniversary of the date of death of the Participant. If
the Participant has no designated Beneficiary, or if the
designated Beneficiary does not elect a method of
distribution, distribution of the Participant's entire
interest must be completed by December 31 of the calendar
year containing the fifth (5th) anniversary of the
Participant's death.
(c) For purposes of Section 6.04(b) above, if the Surviving
Spouse dies after the Participant, but before payments to
such spouse begin, the provisions of Section 6.04(b) shall
be applied as if the Surviving Spouse were the Participant.
(d) For purposes of this Section 6.04, distribution of a
Participant's interest is considered to begin on the
Participant's required beginning date (or, if Section
6.04(c) above is applicable, the date distribution is
required to begin to the Surviving Spouse pursuant to
Section 6.04(b) above).
6.05 Definitions.
(a) Applicable Life Expectancy. The life expectancy (or joint
life and last survivor expectancy) calculated using the
attained age of the Participant (or designated Beneficiary)
as of the Participant's (or designated Beneficiary's)
birthday in the applicable calendar year reduced by one for
each calendar year which has elapsed since the date life
expectancy was first calculated. If Life expectancy is
being recalculated, the applicable life expectancy shall be
the life expectancy as so recalculated. The applicable
calendar year shall be the first distribution calendar
year, and if life expectancy is being recalculated such
succeeding calendar year.
(b) Designated Beneficiary. The individual who is designated
as the beneficiary under the Plan in accordance with Code
Section 401(a)(9) and the proposed regulations under such
Code Section.
(c) Distribution Calendar Year. A calendar year for which a
minimum distribution is required. For distributions
beginning before the Participant's death, the first
distribution calendar year is the calendar year immediately
preceding the calendar year which contains the
Participant's required beginning date. For distributions
beginning after the Participant's death, the first
distribution calendar year is the calendar year in which
distributions are required to begin pursuant to Section
6.04 above.
(d) Life Expectancy. Life expectancy and joint and last
survivor expectancy are computed by use of the expected
return multiples in Tables V and VI of Section 1.72-9 of
the income tax regulations.
Unless otherwise elected by the Participant (or Spouse, in
the case of distributions described in Section 6.04(b)
above) by the time distributions are required to begin,
life expectancies shall be recalculated annually. Such
election shall be irrevocable as to the Participant (or
Spouse) and shall apply to all subsequent years. The life
expectancy of a nonspouse beneficiary may not be
recalculated.
(e) Participant's Benefit.
(1) The Account balance as of the last valuation date in
the calendar year immediately preceding the
distribution calendar year (valuation calendar year)
increased by the amount of any contributions or
forfeitures allocated to the Account balance as of
dates in the valuation calendar year after the
valuation date and decreased by distributions made in
the valuation calendar year after the valuation date.
(2) For purposes of paragraph (1) above, if any portion of
the minimum distribution for the first distribution
calendar year is made in the second distribution
calendar year on or before the required beginning
date, the amount of the minimum distribution made in
the second distribution calendar year shall be treated
as if it had been made in the immediately preceding
distribution calendar year.
(f) Required Beginning Date. The required beginning date of a
Participant is the first day of April of the calendar year
following the calendar year in which the Participant
attains age 70-1/2.
6.06 Transitional Rule.
(a) Notwithstanding the other requirements of this Article,
distribution on behalf of any Employee, including a
5-percent owner, may be made in accordance with all of the
following requirements (regardless of when such
distribution commences):
(1) The distribution by the Plan is one which would not
have disqualified such Plan under Section 401(a)(9) of
the Internal Revenue Code as in effect prior to
amendment by the Deficit Reduction Act of 1984.
(2) The distribution is in accordance with a method of
distribution designated by the Employee whose interest
in the Plan is being distributed or, if the Employee
is deceased, by a beneficiary of such Employee.
(3) Such designation was in writing, was signed by the
Employee or the beneficiary, and was made before
January 1, 1984.
(4) The Employee had accrued a benefit under the Plan as
of December 31, 1983.
(5) The method of distribution designated by the Employee
or the beneficiary specifies the time at which
distribution will commence, the period over which
distributions will be made, and in the case of any
distribution upon the Employee's death, the
beneficiaries of the Employee listed in order of
priority.
(b) A distribution upon death will not be covered by this
transitional rule unless the information in the designation
contains the required information described above with
respect to the distributions to be made upon the death of
the Employee.
(c) For any distribution which commences before January 1,
1984, but continues after December 31, 1983, the Employee
or the beneficiary, to whom such distribution is being
made, will be presumed to have designated the method of
distribution under which the distribution is being made if
the method of distribution was specified in writing and the
distribution satisfies the requirements in Sections
6.06(a)(1) and 6.06(a)(5).
(d) If a designation is revoked any subsequent distribution
must satisfy the requirements of Section 401(a)(9) of the
Code and the proposed regulations under such Code Section.
If a designation is revoked subsequent to the date
distributions are required to begin, the trust must
distribute by the end of the calendar year following the
calendar year in which the revocation occurs the total
amount not yet distributed which would have been required
to have been distributed to satisfy Section 401(a)(9) of
the Code and the proposed regulations under such Code
Section, but for the Section 242(b)(2) election. For
calendar years beginning after December 31, 1988, such
distributions must meet the minimum distribution incidental
benefit requirements in Section 1.401(a)(9)-2 of the
proposed regulations. Any changes in the designation will
be considered to be a revocation of the designation.
However, the mere substitution or addition of another
beneficiary (one not named in the designation) under the
designation will not be considered to be a revocation of
the designation, so long as such substitution or addition
does not alter the period over which distributions are to
be made under the designation, directly or indirectly (for
example, by altering the relevant measuring life). In the
case in which an amount is transferred or rolled over from
one plan to another plan, the rules in Q&A J-2 and Q&A J-3
of the Proposed Regulations under Code Section 401(a)(9)
shall apply.
6.07 Direct Rollover.
(a) General Rule. Notwithstanding any provision of the Plan to
the contrary that would otherwise limit a distributee's
election, a distributee may elect, at the time and in the
manner prescribed by the Plan Administrator, to have any
portion of an eligible rollover distribution paid directly
to an eligible retirement plan specified by the distributee
in a direct rollover. This provision shall be effective
for Plan Years commencing after December 31, 1992.
(b) Special Definitions. For purposes of this Section 6.07,
the following definitions shall apply:
(1) Eligible Rollover Distribution. An eligible rollover
distribution is any distribution of all or any portion
of the balance to the credit of the distributee,
except that an eligible rollover distribution does not
include: any distribution that is one of a series of
substantially equal periodic payments (not less
frequently than annually) made for the life (or life
expectancy) of the distributee or the joint lives (or
joint life expectancies) of the distributee and the
distributee's designated beneficiary, or for a
specified period of ten (10) years or more; any
distribution to the extent such distribution is
required under Section 401(a)() of the Code; and the
portion of any distribution that is not includible in
gross income (determined without regard to the
exclusion for net unrealized appreciation with respect
to employer securities).
(2) Eligible Retirement Plan. An eligible retirement plan
is an individual retirement account described in
Section 408(a) of the Code, an individual retirement
annuity described in Section 409(b) of the Code, an
annuity plan described in Section 403(a) of Code, or a
qualified trust described in Section 401(a) of the
Code, that accepts the distributee's eligible rollover
distribution. However, in the case of an eligible
rollover distribution to the surviving spouse, an
eligible retirement plan is an individual retirement
account or individual retirement annuity.
(3) Distributee. A distributee includes an employee or
former employee. In addition, the employee's or
former employee's surviving spouse and the employee's
or former employee's spouse or former spouse who is
the alternate payee under a qualified domestic
relations order, as defined in Section 414(p) of the
Code, are distributees with regard to the interest of
the spouse or former spouse.
(4) Direct Rollover. A direct rollover is a payment by
the Plan to the eligible retirement plan specified by
the distributee.
6.08 Waiver of 30 Day Notice Requirement. If a distribution is one
to which sections 401(a)(11) and 417 of the Code do not apply,
such distribution may commence less than thirty (30) days after
the notice required under Section 1.411(a)-11(c) of the Income
Tax Regulations is given provided that:
(a) the Plan Administrator clearly informs the Participant that
the Participant 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 Participant, after receiving the notice, affirmatively
elects a distribution.
ARTICLE VII
Plan Administration
7.01 Allocation of Fiduciary Powers. Each of the Fiduciaries shall
have only those specific powers and responsibilities that are
specifically given to them under the Plan. The Employer shall
have the exclusive responsibility for making the contributions
provided for herein, the exclusive power to appoint and remove
the Trustee and the Plan Administrator, and the exclusive power
to amend or terminate this Plan, and the Employer shall have no
other power or responsibilities. The Trustee shall have the
exclusive authority, discretion and responsibility to manage and
control the assets of the Plan, and the Trustee shall have no
other responsibilities other than those provided in this Plan.
The Plan Administrator shall have the exclusive authority and
responsibility to control and manage the operation and
administration of this Plan in accordance with the terms and
conditions described in this Plan, and to exercise all fiduciary
functions provided in the Plan or necessary to the operation of
the Plan except such functions as are assigned to other
Fiduciaries pursuant to this Plan. Each Fiduciary warrants that
any directions given, information furnished, or action taken by
it shall be in accordance with the provisions of the Plan
authorizing or providing for such direction, information or
action. Furthermore, each Fiduciary may rely upon any such
direction, information or action of another Fiduciary as being
proper under this Plan, and is not required to inquire into the
propriety of any such direction, information or other action.
It is intended under this Plan that each Fiduciary shall be
responsible for the proper exercise of its own powers, duties,
responsibilities and obligations under this Plan and shall not
be responsible for any act or failure to act of another
Fiduciary except in circumstances where ERISA imposes liability
for the breach of a co-Fiduciary. No Fiduciary guarantees the
trust fund in any manner against investment loss or depreciation
in asset value except in circumstances where ERISA imposes
liability for such loss or depreciation.
7.02 Plan Administrator. The Plan shall be administered by the Plan
Administrator who shall be appointed by and serve at the
pleasure of the Board of Directors of the Employer. All usual
and reasonable expenses of the Plan Administrator may be paid in
whole or in part by the Employer, and any expenses not paid by
the Employer shall be paid by the Trustee out of the principal
or income of the trust fund. However, if such expenses result
from claims made against a Participant's Account, then such
expenses shall be charged to and paid out of such account.
Claims against a Participant's Account shall include, but not be
limited to, domestic relations orders (whether or not qualified
domestic relations orders under Code Section 414(p)) and spousal
distribution rights under the Retirement Equity Act of 1984
(REA).
7.03 Claim Procedure. A Participant or Beneficiary may claim any
benefits due under the Plan by mailing to the last known address
of the Plan Administrator a written application outlining to the
best of the claimant's knowledge or ability, the nature, amount
and form of such benefit. The Plan Administrator shall make all
determinations as to the right of any person to a benefit under
the Plan. In accordance with regulations of the Secretary of
Labor issued under Section 503 of ERISA, the Plan Administrator
establishes the following claims procedure:
(a) The Plan Administrator shall review each claim by a
Participant for benefits under the Plan.
(b) If a claim is wholly or partially denied, notice of the
denial meeting the requirements of Section 7.03(c) shall be
furnished to the claimant within a reasonable time after
the claim has been filed.
(c) The Plan Administrator shall provide to any claimant who is
denied a claim for benefits a written notice setting forth
in a manner calculated to be understood by the claimant the
following:
(1) the specific reason or reasons for the denial;
(2) specific reference to pertinent plan provisions on
which the denial is based;
(3) a description of any additional material or
information necessary for the claimant to perfect the
claim and an explanation why the material or
information is necessary;
(4) an explanation of the plan's claim review procedure,
as set forth in Sections 7.03(d) and 7.03(e) of this
Agreement.
(d) The purpose of the review procedure set forth in this
Section 7.03(d) and in Section 7.03(e) is to provide a
procedure by which a claimant under the Plan may have a
reasonable opportunity to appeal a denial of a claim in
order to obtain a full and fair review. To accomplish that
purpose, the claimant or his duly authorized
representative:
(1) may request a review upon written application to the
Board of Directors of the Employer;
(2) may review pertinent Plan documents or agreements; and
(3) may submit issues and comments in writing.
A claimant (or his duly authorized representative) shall
request a review by filing a written application for review
at any time within sixty (60) days after receipt by the
claimant of written notice of the denial of his claim.
(e) A decision on review of a denial of a claim shall be made
in the following manner:
(1) the decision on review shall be made by the Board of
Directors of the Employer which may in its discretion
hold a hearing on the denied claim. The Board of
Directors will make its decision promptly unless
special circumstances (such as the need to hold a
hearing) require an extension of time for processing,
in which case a decision shall be rendered as soon as
possible, but not later than one hundred twenty (120)
days after receipt of the request for review; and
(2) a decision on review shall be in writing and shall
include specific reasons for the decisions written in
a manner calculated to be understood by the claimant
and specific references to the Plan provisions on
which the decision is based.
7.04 Reporting and Disclosure. The Plan Administrator shall exercise
such authority and responsibility as it deems necessary in order
to comply with the reporting and disclosure requirements of
ERISA and any valid governmental regulations issued under such
Act relating to the preparation and filing of all reports and
registrations required to be filed by the Plan with any
governmental agency; compliance with all disclosure requirements
imposed by state or federal laws; maintenance of all records of
the Plan other than those required to be maintained by other
Fiduciaries; and the preparation and delivery of all reports,
information and notifications required to be given to
Participants or Beneficiaries in accordance with state or
federal laws.
7.05 Plan Administrator's Duties and Powers. The Plan
Administrator shall have such duties and powers as may be
necessary to discharge its duties, including, but not by way of
limitation, the following:
(a) To construe and interpret the Plan, decide all questions of
eligibility and determine the amount, manner and time of
payment of any benefits under the Plan;
(b) To prescribe procedures to be followed by Participants or
Beneficiaries filing applications for benefits;
(c) To prepare and distribute, in such manner as the Plan
Administrator determines to be appropriate, information
explaining the Plan;
(d) To receive from the Employer and from Participants such
information as shall be necessary for the proper
administration of the Plan;
(e) To furnish the Employer, upon request, such annual reports
with respect to the administration of the Plan as are
reasonable and appropriate.
(f) To receive, review and keep on file (as it deems convenient
or proper) reports of the financial condition, and of the
receipts and disbursements, of the trust fund from the
Trustee;
(g) To appoint or employ individuals to assist in the
administration of the Plan and any other agents it deems
advisable, including legal and actuarial counsel.
The Plan Administrator shall have no power to add to, subtract
from or modify any of the terms of the Plan, or to change or add
to any benefits provided by the Plan, or to waive or to fail to
apply any requirements of eligibility for a benefit under the
Plan.
7.06 Administrative Rules. The Plan Administrator may adopt such
rules as it deems necessary, desirable, or appropriate. All
rules and decisions of the Plan Administrator shall be uniformly
and consistently applied to all Participants in similar
circumstances. Upon making a determination or calculation, the
Plan Administrator shall be entitled to rely upon information
furnished by a Participant or Beneficiary, the Employer, the
legal counsel of the Employer, or the Trustee.
7.07 Directions to Trustee. The Plan Administrator shall
issue directions to the Trustee concerning all benefits which
are to be paid from the trust fund pursuant to the provisions of
the Plan.
7.08 Benefit Applications. The Plan Administrator may require a
Participant to complete and file an application for a benefit,
to complete all other forms furnished by the Plan Administrator,
and to furnish all pertinent information requested by the Plan
Administrator.
ARTICLE VIII
The Trustee
8.01 Resignation and Removal. The Trustee may resign by a written
instrument addressed to the Employer. The Employer may remove
the Trustee by a written instrument addressed to the Trustee.
Appointments to vacancies shall be made by the Employer and any
successor Trustee shall evidence its acceptance of such
appointment by written instrument addressed to the Employer.
Within sixty (60) days after receipt of the written acceptance
of such appointment by the successor Trustee, the Trustee shall
assign, transfer and pay over to such successor Trustee, the
funds and properties then constituting the trust fund together
with the proper accounting for such items. If such accounting
is not objected to within 60 days after the receipt by the
Employer or the successor Trustee, the Trustee shall be deemed
to be discharged of all duties under the Plan except to the
extent otherwise provided by law.
If the Trustee is a corporation at any time it shall be merged,
or consolidated with, or shall sell or transfer substantially
all of its assets and business to another corporation, whether
state or federal, or shall be reorganized or reincorporated in
any manner, then the resulting or acquiring corporation shall be
substituted for such corporate Trustee without the execution of
any instrument and without any action upon the part of the
Employer, any Participant or Beneficiary, or any other person
having or claiming to have an interest in the trust fund or
under the plan.
8.02 Information to be Furnished to Trustee. The Employer
and the Plan Administrator shall furnish to the Trustee
such information as required or desirable for the purpose of
enabling the Trustee to carry out the provisions of the Plan and
the Trustee may rely upon such information as being correct.
8.03 Accounting. The Trustee shall keep accurate and detailed
accounts of investments, receipts, disbursements and other
transactions under this Plan and all such accounts and other
records relating to it shall be open to inspection and audit at
all reasonable times by any person designated by the Employer or
the Plan Administrator. Within sixty (60) days following the
close of the Plan Year and within sixty (60) days after the
removal or resignation of the Trustee and the acceptance of
appointment by a Successor Trustee as provided in Section 8.01,
the Trustee shall file with the Employer a written account
setting forth all investments, receipts, disbursements and other
transactions effected by it during such Plan Year or during the
period from the close of the last Plan Year to the date of such
removal or resignation. To the extent permitted by law, but
subject to any express provision of applicable law as may be in
effect from time to time to the contrary, no person other than
the Employer may require an accounting or bring any action
against the Trustee with respect to the trust fund or its
actions as Trustee.
8.04 Trustee's Right to Judicial Settlement. Notwithstanding any
other provision of this Article, the Trustee shall have the
right to have a judicial settlement of its accounts. In any
proceeding for a judicial settlement of the Trustee's accounts,
or for instructions in connection with the trust fund, the only
necessary parties in addition to the Trustee shall be the
Employer and the Plan Administrator. If the Trustee so elects,
it may bring in any other person or persons as a party or
parties defendant.
8.05 Trustee's Expenses. To the extent not paid by the Employer,
expenses incurred by the Trustee in the performance of its
duties under the Plan, including reasonable compensation for
agents and for the services of counsel rendered to the Trustee
and related expenses and all other proper charges and
disbursements of the Trustee including all taxes that may be
levied or assessed under existing or future laws shall be