View:
As filed with the Securities and Exchange Commission on October 19, 1998
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-8 REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933
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L.B. FOSTER COMPANY
(Exact name of registrant as specified in its charter)
Pennsylvania 25-1324733
(State of Incorporation) (I.R.S. Employer Identification No.)
415 Holiday Drive, Pittsburgh, Pennsylvania 15220
(Address of principal executive offices) (Zip Code)
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L.B. FOSTER COMPANY
Voluntary Investment Plan
Retirement Savings Plan for Non-Union Hourly Employees
(Full titles of the plans)
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DAVID L. VOLTZ, Esq.
Vice President, General Counsel and Secretary
L.B. Foster Company
415 Holiday Drive
Pittsburgh, Pennsylvania 15220
(Name and address of agent for service)
(412) 928-3431
(Telephone number, including area code, of agent for service)
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Copy to:
MICHAEL M. LYONS, Esq.
Klett Lieber Rooney & Schorling
40th Floor, One Oxford Centre
Pittsburgh, Pennsylvania 15219
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CALCULATION OF REGISTRATION FEE
Proposed Proposed
Amount maximum maximum Amount of
Title of securities to be offering price aggregate registration
to be registered registered per share* offering price* fee
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Common Stock,
$.01 par value 2,000,000 shs. $3.94 $7,880,000 $2,325
*Estimated in accordance with Rule 457(c) solely for the purpose of computing
the registration fee, based on the average of the high and low prices for
October 15, 1998 as reported in the NASDAQ National Market System.
In addition, pursuant to Rule 416(c) under the Securities Act of 1933, this
registration statement also covers an indeterminate amount of interests to be
offered or sold pursuant to the employee benefit plans described herein.
PART II.
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
L.B. Foster Company is hereinafter referred to as the "Company," the
Company's Voluntary Investment Plan as Amended and Restated is hereinafter
referred to as the "Investment Plan," and the Company's Retirement Savings Plan
for Non-Union Hourly Employees as Amended and Restated is hereinafter referred
to as the "Retirement Plan." The Investment Plan and the Retirement Plan are
hereinafter collectively referred to as the "Plans."
Item 3. Incorporation of Documents by Reference.
The documents listed below are incorporated by reference in this
registration statement:
(a) The Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1997, filed with the Securities and Exchange Commission
("Commission") under the Securities Exchange Act of 1934, as amended ("Exchange
Act").
(b) The Company's Quarterly Reports on Form 10-Q for the quarterly
periods ended March 31, 1998 and June 30, 1998 and its Current Reports on Form
8-K dated May 14 and June 9, 1998, filed with the Commission under the Exchange
Act.
(c) The descriptions of the Company's Common Stock, $.01 par value, and
Common Stock Purchase rights contained in the Company's Registration Statements
on Form 8-A/A and Form 8-A, respectively, filed with the Commission under the
Exchange Act.
All documents filed by the Company or the Plans pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act after the date of this
registration statement, and prior to the filing of a post-effective amendment
which indicates that all securities offered have been sold or which reregisters
all securities then remaining unsold, shall be deemed to be incorporated by
reference in this registration statement and to be part thereof from the date of
filing of such documents.
Item 4. Description of Securities.
Not Applicable
Item 5. Interests of Named Experts and Counsel.
None
Item 6. Indemnification of Directors and Officers.
Section 6.01 of the Company's By-Laws provides, in part, that the
Company shall, to the fullest extent permitted by Pennsylvania law, indemnify
its officers and directors in connection with any actual, threatened or
completed action, suit or proceeding arising out of their service to the Company
or to another entity at the request of the Company.
The Company's directors and officers currently are covered as insureds
under directors' and officers' liability insurance. Such insurance, subject to
an annual renewal and certain rights of the insurer to terminate, provides an
aggregate maximum of $1,000,000 of coverage for directors and officers of the
Company and its subsidiaries for claims made during the policy period.
Each Plan provides that, except to the extent insured and except for
willful misconduct, the Company shall indemnify any employee of the Company
against any liability incurred by reason of the employee's service as a
fiduciary with respect to the Plan.
Item 7. Exemption From Registration Claimed.
No "restricted" securities will be reoffered or resold.
Item 8. Exhibits.
The following exhibits are filed herewith as part of this registration
statement:
4.1 Voluntary Investment Plan as Amended and Restated.
4.1.1 Internal Revenue Service Determination Letter for Voluntary
Investment Plan.
4.2 Retirement Savings Plan for Non-Union Hourly Employees as Amended
and Restated.
4.2.1 Internal Revenue Service Determination letter for Retirement
Savings Plan for Non-Union Hourly Employees.
5 Opinion and consent of Klett Lieber Rooney & Schorling, a
Professional Corporation.
23 Consent of Ernst & Young LLP.
Item 9. Undertakings.
The undersigned registrant undertakes that, for purposes of determining
any liability under the Securities Act of 1933, each filing of the registrant's
annual report pursuant to section 13(a) or section 15(d) of the Securities
Exchange Act of 1934 that is incorporated by reference in the registration
statement shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof. The registrant
further undertakes to remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering. Insofar as indemnification for liabilities arising
under the Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the indemnification provisions
described in Item 6, or otherwise, the registrant has been advised that in the
opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other
than the payment by the registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Pittsburgh, State of Pennsylvania, on October 19,
1998.
L.B. FOSTER COMPANY
(Registrant)
By:/s/Lee B. Foster
----------------------
Lee B. Foster II
President
Power of Attorney
Each person whose signature appears below hereby constitutes and
appoints Lee B. Foster II, Roger F. Nejes and David L. Voltz, and each of them,
his true and lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement on Form S-8 and to file the same,
with all exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission under the Securities Act of 1933.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
/s/Lee B. Foster Director and Chairman of the Board, October 16, 1998
- -------------------- President and Chief Executive Officer
Lee B. Foster II
/s/John W. Puth Director October 16, 1998
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John W. Puth
/s/William H. Rackoff Director October 16, 1998
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William H. Rackoff
/s/Richard L. Shaw Director October 16, 1998
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Richard L. Shaw
/s/Roger L. Nejes Senior Vice President - Finance and October 16, 1998
- -------------------- Administration (Principal Financial
Roger F. Nejes and Accounting Officer)
The Plans
Pursuant to the requirements of the Securities Act of 1933, the
administrators of the Plans have duly caused this registration statement to be
signed on their behalf by the undersigned, thereunto duly authorized, in the
City of Pittsburgh, State of Pennsylvania, on October 19, 1998.
L.B. FOSTER COMPANY VOLUNTARY
INVESTMENT PLAN
L.B. FOSTER COMPANY RETIREMENT
SAVINGS PLAN FOR NON-UNION
HOURLY EMPLOYEES
(The Plans)
By: /s/Linda M. Terpenning
---------------------------------
Name: Linda M. Terpenning
Title:Vice President - Human Resources
L. B. FOSTER COMPANY
VOLUNTARY INVESTMENT PLAN
Effective January 1, 1999
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS 2
ARTICLE II PARTICIPATION 11
ARTICLE III PARTICIPANT CONTRIBUTIONS 12
ARTICLE IV COMPANY CONTRIBUTIONS 16
ARTICLE V PARTICIPANT ACCOUNTS 22
ARTICLE VI WITHDRAWALS AND LOANS 24
ARTICLE VII VESTING AND TERMINATION OF EMPLOYMENT 27
ARTICLE VIII TRANSFER 29
ARTICLE IX DISTRIBUTION OF BENEFITS 30
ARTICLE X ADMINISTRATION 35
ARTICLE XI MISCELLANEOUS PROVISIONS 37
ARTICLE XII PROVISIONS RELATING TO TOP-HEAVY PLANS 41
ESTABLISHMENT AND PURPOSE
WHEREAS, as of November 1, 1972, the L. B. Foster Company and certain
individual Trustees entered into an Agreement pursuant to which the L. B. Foster
Company Thrift Plan and Trust (the "Thrift Plan") were established.
WHEREAS, the Plan was amended effective January 1, 1984 to comply with the Tax
Equity and Fiscal Responsibility Act of 1982, the Deficit Reduction Act of 1984
and the Retirement Equity Act of 1984, and further amended effective July 1,
1984 to add a Section 401(k) of the Internal Revenue Code provision to the Plan
and to change its name to that of the "L. B. Foster Company Voluntary Investment
Plan" and further amended and restated the Plan effective August 1, 1986;
WHEREAS, the L. B. Foster Company Voluntary Investment Plan shall be effective
July 1, 1984 as an amendment and restatement of the Thrift Plan in its entirety.
The rights of any employee whose employment terminated prior to July 1, 1984
shall be determined solely by the provisions of the Thrift Plan in effect at the
time of such termination of employment unless specifically otherwise provided
herein;
WHEREAS, the purpose of the Voluntary Investment Plan is to encourage savings by
employees and to provide them with security for retirement;
WHEREAS, the Employer desired to further amend the Plan and therefore adopted an
amended and restated Plan effective as of January 1, 1990.
WHEREAS, the Employer desires to further amend the Plan;
NOW, THEREFORE, the Employer hereby adopts this amended and restated Plan
effective as of January 1, 1999 as set forth herein.
The Plan, as amended herein, shall become effective January 1, 1999. The rights
to benefits of any employee whose employment terminated prior to January 1, 1999
shall be determined solely by the provisions of the employee benefit plan in
which he was covered, if any, as in effect at the time of such termination of
employment, unless specifically otherwise provided herein.
ARTICLE I
DEFINITIONS
1.1 Accrued Benefit means, with respect to any Participant at any time,
the then vested amount of his Participant Account.
1.2 Accumulated Profits means net income of profits of the Company for
prior years as determined in the same manner as Current Profits.
1.3 Actual Contribution Percentage means, for any Participant or group of
Participants, the average of the ratios (calculated separately for
each Participant in the group) of (a) the sum of Company Matching
Contributions made to a Participant Account for the Plan Year and
Voluntary Employee Contributions made to a Participant Account for the
Plan Year, to (b) the Participant's compensation for the Plan Year.
For purposes of determining the Actual Contribution Percentage,
"compensation" means the Participant's earnings as reported on Form
W-2 plus any amounts deferred under a plan qualifying under Code
Section 125 or 401(k), minus any amounts paid as severance or amounts
earned prior to the participant becoming an Eligible Employee.
1.4 Actual Deferral Percentage means, for any Participant or group of
Participants, the average of the ratios (calculated separately for
each Participant in the group) of (a) Salary Deferral Contributions
made on behalf of the Participant for the Plan Year, to (b) the
Participant's compensation for the Plan Year. For purposes of
determining the Actual Deferral Percentage, "compensation" means the
Participant's earnings as reported on Form W-2 plus any amounts
deferred under plan qualifying under Code Section 125 or 401(k), minus
any amounts paid as severance or amounts earned prior to the
participant becoming an Eligible Employee.
1.5 Administrative Committee or Committee means the L. B. Foster Employee
Benefit Policy and Review Committee appointed by the Board of
Directors for the purposes of administering this Plan in accordance
with the provisions of Section 10.2 of Article X.
1.6 Affiliated Company means any subsidiary or affiliate of the Company,
whether or not such entities have adopted the Plan, and any other
entity which is a member of a Controlled Group.
1.7 Board of Directors means the Board of Directors of the L. B. Foster
Company.
1.8 Break in Service means any 12-consecutive-month period during which an
Employee completes fewer than 500 Hours of Service. The relevant
periods for eligibility and vesting purposes shall be determined in
the same manner as is used for determining Years of Service. Solely
for the purpose of determining whether a Break in Service has
occurred, a Participant who is absent from work for maternity or
paternity reasons shall receive credit for the Hours of Service which
would otherwise have been credited to such Participant but for such
absence, or in any case in which such Hours cannot be determined,
eight Hours of Service per day of such absence. For purposes of this
Paragraph, an absence from work for maternity or paternity reasons
mean an absence (1) by the reason of the pregnancy of the Participant,
(2) by reason of a birth of a child of the Participant, (3) by reason
of the placement of a child with the Participant in connection with
the adoption of such child by such Participant, or (4) for purposes of
caring for such child for a period beginning immediately following
such birth or placement. The Hours of Service credited under the
paragraph shall be credited (1) in the Plan Year in which the absence
begins if the crediting is necessary to prevent a Break in Service in
that period, or (2) in all other cases, in the following Plan Year.
1.9 Code means the Internal Revenue Code of 1986 as amended from time to
time.
1.10 Company means the L. B. Foster Company, a corporation organized and
existing under the laws of the Commonwealth of Pennsylvania, as well
as any Affiliated Company which the Board of Directors has designated
as eligible to adopt the Plan, which has adopted this Plan and which
has agreed to be bound by the terms of the Plan and Trust Agreement;
provided, however, that an Affiliated Company shall become a Company
for purposes of the Plan upon, but not before, the date that such
Affiliated Company agrees to be bound by the terms of the Plan and
Trust, and employees of such Affiliated Company shall become Employees
for all purposes under the Plan upon, but not before, the date of such
agreement.
1.11 Company Contribution means the contribution the Company shall make to
Participant Accounts. Company Contributions are comprised of :
(a) Fixed Contributions as provided for in accordance with Section 4.1(a);
(b) Company Matching Contributions as provided for in accordance with
Section 4.1(b);
(c) Mandatory Additional Company Contributions as provided for in
accordance with Section 4.1(c); and
(d) Discretionary Contributions as provided for in accordance with
Section 4.1(e).
1.12 Company Contribution Portion means, as of any Valuation Date, the then
amount of the Company Contributions allocated to a Participant Account,
adjusted to reflect all credits and debits attributable to such
contributions which are made to such Participant pursuant to Section
5.3.
1.13 Compensation means the earnings paid by the Company to the Employee
during the Plan Year in the form of base salary, overtime payments,
vacation pay, bonuses or cash incentive pay, commissions, and any
elective deferrals under Section 125 or 401(k) of the Code, but
excluding all other payments.
In addition to other applicable limitations set forth
in the plan, and notwithstanding any other provision of the plan to the
contrary, for plan years beginning on or after January 1, 1994, the
annual compensation of each employee taken into account under the plan
shall not exceed the OBRA '93 annual compensation limit. The OBRA '93
annual compensation limit is $150,000 (indexed to $160,000 in 1997), as
adjusted by the Commissioner for increases in the cost of living in
accordance with section 401(a)(17)(B) of the Internal Revenue Code. The
cost-of-living adjustment in effect for a calendar year applies to any
period, not exceeding 12 months, over which compensation is determined
(determination period) beginning in such calendar year. If a
determination period consists of fewer than 12 months, the OBRA '93
annual compensation limit will be multiplied by a fraction, the
numerator of which is the number of months in the determination period,
and denominator of which is 12.
For plan years beginning on or after January 1, 1994, any reference in
this plan to the limitation under section 401(a)(17) of the Code shall
mean OBRA '93 annual compensation limit set forth in this provision. If
compensation for any prior determination period is taken into account
in determining an employee's benefits accruing in the current plan
year, the compensation for that prior determination period is subject
to the OBRA '93 annual compensation limit in effect for that prior
determination period. For this purpose, for determination periods
beginning before the first day of the first plan year beginning on or
after January 1, 1994, the OBRA '93 annual compensation limit is
$150,000 (indexed to $160,000 in 1997).
However, an Employee's compensation during a period of service in the
Uniformed Services shall be computed at the rate of the employee's
base monthly salary at the time the employee ceased active employment.
1.14 Controlled Group means the group of companies who, along with the
Company, is a member of a controlled group of corporations within the
meaning of Section 1563(a) of the Code, determined without regard to
Sections 1563(a)(4) and (e)(3)(C) of the Code, or a member with the
Company of a group of trades or businesses (whether or not
incorporated) under common control as determined by regulations issued
by the Secretary of the Treasury under Section 414(c) of the Code.
1.15 Current Profits means the amount of net income or profits of a Company
for the current Plan Year as determined by the Company either on an
estimated or final basis in accordance with sound accounting practices,
without deduction for taxes based upon income, or for contributions
made by the Company under this Plan. Such determination and Company
Contribution shall not be open to question by any Participant, either
before or after the Company Contribution has been made.
1.16 Disability means a Participant's incapacity to perform the duties of
his occupation or employment because of a medically determinable
physical or mental impairment which can be expected to be total and
permanent. Such determination of Disability shall be made by the
Administrative Committee with the advice of competent medical
authority.
1.17 Discretionary contribution means the contribution the Company may make
to Participant Accounts in accordance with Section 4.1(e).
1.18 Early Retirement Date means at the election of the Participant, the
first day of the month coincident with or following the Participant's
termination of employment with the Company, provided that the
Participant had attained age 55 and completed five Years of Service
prior to termination.
1.19 Effective Date means January 1, 1999.
1.20 Eligible Employee means a salaried Employee of the Company who is not a
leased employee within the meaning of Section 414(n)(2) and who has
completed one Year of Service and has attained his 21st birthday.
1.21 Employee means any individual in the employment of the Company or an
Affiliated Company which is part of the Controlled Group including
both leased employees within the meaning of Section 414(n)(2) of the
Code and any Employee who is also an officer or director of the
Company; provided, however, that it shall not include any person where
employment is governed by the terms of a collective bargaining
agreement under which retirement benefits were the subject of good
faith bargaining between the Company and Employee representatives,
unless such agreement expressly provides for the coverage of such
person in this Plan. Notwithstanding the foregoing, if leased
employees constitute less than 20% of the Company's nonhighly
compensated work force within the meaning of Section 414(n)(5)(C)(ii)
of the Code, the term "Employee" shall not include those leased
employees covered by a plan described in Section 414(n)(5) of the Code
unless otherwise provided for by the terms of the Plan.
1.22 Fixed Contribution means the contribution made by the Company in
accordance with Section 4.1(a).
1.23 Fund or Investment Fund means the trust fund held by the trustee in
accordance with the Trust Agreement.
1.24 Highly Compensated Employee means any individual who performs service
during the determination year and is described in one or more of the
following groups:
(a) An employee who is a 5% owner, as defined in section 416 (i) (1) (A)
(iii), at any time during the determination year or the look-back
year.
(b) An employee who receives compensation in excess of $80,000
(indexed in accordance with section 415 (d) during the
look-back year.)
For purposes of determining Highly Compensated Employees, the following
applies:
(a) The determination year is the plan year for which the
determination of who is highly compensated is being made.
(b) The look-back year is the 12-month period immediately preceding the
determination year.
(c) Compensation is compensation within the meaning of Code
Section 415 (c) (3) including elective or salary reduction
contributions to a cafeteria plan, cash or deferred
arrangement or tax-sheltered annuity.
(d) Employers aggregated under Section 414 (b), (c), (a) or (o) of the
Code are treated as a single employer.
1.25 Hour of Service means:
(a) Each hour for which an Employee is paid, or entitled to
payment, for the performance of duties for the Company or any
Affiliated Company which is part of the Controlled Group
during the applicable computation period.
(b) Each hour for which back pay, irrespective of mitigation of
damages, is awarded or agreed to by the Company or any
Affiliated Company which is part of the Controlled Group;
provided, however, that the same hours shall not be credited
more than once, and such hours shall be credited to the
Employee for the computation period to which the award or
agreement relates rather than the period in which it is
awarded, agreed upon or paid.
(c) Each hour for which an Employee is paid, or is entitled to
payment, by the Company or an Affiliated Company which is part
of the Controlled Group on account of a period of time during
which no duties are performed due to vacation, holiday,
illness, incapacity (including Disability, other than
permanent Disability), layoff, jury duty, military duty or
leave of absence. In applying the preceding sentence:
(1) No more than 501 Hours of Service are required to be
credited to an Employee on account of a single
continuous period during which the Employee performs
no duties (whether or not such period occurs within a
single computation period);
(2) An Hour of Service need not be credited if payment is
made or due under a plan maintained solely for the
purpose of complying with applicable workmen's
compensation, or unemployment compensation or
disability insurance laws; and
(3) Hours of Service are not required to be credited for
a payment which solely reimburses an Employee for
medical or medically related expenses incurred by an
Employee.
(d) Each hour for periods of employment with any predecessor if
the Company maintains a plan of such a predecessor or, if such
a plan is not maintained, to the extent required under
regulations under Section 414(a)(2) of the Code.
Notwithstanding the above, the Board of Directors may amend
the Plan to grant additional credit for periods of employment
with a predecessor employer or a corporation, substantially
all of the assets of which have been acquired by the Company,
provided that in amending the Plan to grant such credit, the
Board of Directors acts in a uniform and nondiscriminatory
manner with respect to all Employees similarly situated.
(e) In addition to the Hours of Service credited above, an Employee shall
be credited with Hours of Service for any noncompensated absence which
is authorized by a Company or any Affiliate Company which is part of
the Controlled Group, in accordance with its uniform leave policy,
provided the Employee returns to active employment following the
termination of the period of authorized absence. For this purpose,
periods of absence to enter service with the Uniformed Services shall
be counted in computing Hours of Service, if the Employee returns to
work for the Company or an Affiliated Company within the period
following his discharge or release to inactive duty from such service
during which his reemployment rights are guaranteed by law.
(f) An Employee shall be credited with 45 Hours of Service for
each week during which he is entitled to credit for at least
one Hour of Service; provided, however, that if the Employee
demonstrates to the satisfaction of the Committee that his
actual number of Hours of Service in any week is greater than
45, he shall be credited with such actual number of Hours of
Service.
(g) For purposes of eligibility to participate in the Plan
(Section 1.20) and vesting (Sections 7.2 and 12.6), hours
meeting the requirements of this section but for the fact that
the individual was not an Employee during the period to which
the hours would have been credited (by reason of serving in a
collective bargaining unit) shall nevertheless be taken into
account.
Furthermore, the basis upon which Hours of Service shall be
calculated and credited to a computation period shall be
determined pursuant to Section 2530.200b-2(b) of the
Department of Labor Relations.
1.26 Investment Manager means the person or entity appointed by the
Committee to invest assets in the Participant Account upon the
direction of the Participants.
1.27 Non-Highly Compensated Employee means a salaried Employee of the
Company who has completed one Year of Service, has attained his 21st
birthday and who is not a Highly Compensated Employee.
1.28 Normal Retirement Age means age 65.
1.29 Normal Retirement Date means the first day of the month coinciding with
or next following the date on which a Participant attains his 65th
birthday.
1.30 Participant means an Eligible Employee who enters the plan in
accordance with Article II. Any such Eligible Employee shall remain a
Participant until all benefits due him have been distributed.
1.31 Participant Account or Account means, as of any Valuation Date, the sum
of the Salary Deferral Contribution Portion, the Voluntary Employee
Contribution Portion, the Prior Plan amounts, any rollovers and the
Company Contribution Portion.
1.32 Plan means the L. B. Foster Company Voluntary Investment Plan (the "L.
B. Foster V.I.P."), as herein set forth and as amended from time to
time.
1.33 Plan Year means the 12-consecutive-month period beginning with January
1 and ending with December 31.
1.34 Prior Plan means the L. B. Foster company Thrift Plan as was in effect
on November 1, 1972 and as amended from time to time.
1.35 Retirement means termination of employment with a pension (whether
immediate or deferred) under the provisions of a retirement plan of the
Company or an Affiliated Company, or election of an Early Retirement
Date or termination of employment upon or after attaining Normal
Retirement Age.
1.36 Salary Deferral Contribution means the amount that a Participant
designates as Salary Deferral contributions in accordance with Section
3.1(a) of Article III.
1.37 Salary Deferral Contribution Portion means, as of any Valuation Date,
the then amounts of the Participant's total Salary Deferral
Contributions, adjusted to reflect all debits and credits attributable
to such contributions which are made to such Participant Account
pursuant to Section 5.3.
1.38 Spouse means the lawful Spouse of the Participant at the earlier of the
Participant's date of death or the date benefits commence to the
Participant under the Plan.
1.39 Trust Agreement means any agreement entered into between the Company
and any Trustee to carry out the purpose of the Plan.
1.40 Trustee means any corporation, individual or group of individuals
appointed by the Board of Directors to act as Trustee under a Trust
Agreement.
1.41 Trust Fund means the fund established pursuant to the Trust Agreement
to hold and invest assets accumulated under the Plan.
1.42 Valuation Date means a day no less frequent than once in each calendar
quarter and any other date as designated by the Administrative
Committee.
1.43 Voluntary Employee Contributions means the after-tax contributions made
by a Participant in accordance with the provisions of Section 3.1(b).
1.44 Voluntary Employee Contribution Portion means, as of any Valuation
Date, the then amounts of the Participant's Voluntary Employee
Contributions, adjusted to reflect all debits and credits attributable
to such contributions which are made to such Participant Account
pursuant to Section 5.3.
1.45 Year of Service means each 12-consecutive-month period during which an
Employee completes at least 1,000 Hours of Service. For purposes of
eligibility to participate in the Plan, and for purposes of determining
the maximum Company Matching Contribution pursuant to Section 5.2 of
the Plan, the relevant 12-consecutive-month period shall begin on an
employee's first day of employment, or reemployment following a Break
in Service, and each anniversary thereof.
For purposes of determining an Employee's vested percentage, the
relevant 12-consecutive-month period is the Plan Year. An Employee
shall not be entitled to any credit for partial Years of Service except
that an Eligible Employee shall be credited with a full Year of Service
in the year of his employment, or reemployment, regardless of the
number of Hours of Service completed by him in such Plan Year.
A Participant who incurs a Break in Service of five years or longer and
is reemployed shall have his Year of Service prior to reemployment
disregarded if:
(a) He did not have a vested interest in his company contribution
as of the day his Break in Service began; and
(b) The length of his Break in Service equals or exceeds his Years
of Service prior to the Break in Service.
An Employee who has had prior Years of Service disregarded will be
treated as a new Employee for all purposes of the Plan. In all other
cases, if a former Employee is reemployed by the Company, his prior
Years of Service will be aggregated with his Years of Service after the
Break in Service.
1.46 Uniformed Services means the Armed Forces, the Army National Guard and
the Air National Guard when engaged in active duty for training,
inactive duty training, or full-time National Guard duty, the
commissioned corps of the Public Health Service, and any other category
of persons designated by the President in time of war or emergency.
"Service in the uniformed services" means the performance of duty on a
voluntary or involuntary basis in a uniformed service under competent
authority and includes active duty, active duty for training, initial
active duty for training, inactive duty training, full-time National
Guard duty, and a period for which a person is absent from a position
of employment for the purpose of an examination to determine the
fitness of the person to perform any such duty. In no event shall the
total length of service credited for service in the uniformed services
exceed five (5) years.
ARTICLE II
PARTICIPATION
2.1 Participation.
(a) Initial Participation. An Eligible Employee automatically
becomes a Participant in the Plan on the first day of the
month following the month in which an Employee first becomes
an Eligible Employee. An Eligible Employee may elect to make
Salary Deferral Contributions and Voluntary Employee
Contributions as of the first day of the month following the
first day on which such Employee becomes an Eligible Employee,
provided that the Employee authorizes the change in a manner
approved by the Administrative Committee.
(b) Following a Break in Service. A Participant who incurs a Break
in Service shall become an Eligible Employee on the first day
of the month coincident with or next following his completion
of one Hour of Service subsequent to such Break in Service.
2.2 Participant Contributions. A Participant may elect to make Salary
Deferral Contributions and Voluntary Employee Contributions to the
Plan. Such Participant's Salary Deferral Contributions and Voluntary
Employee Contributions shall begin on the first day of the month,
provided that the Employee authorizes the change in a manner approved
by the Administrative Committee.
2.3 Provisions Relating to Leased Employees.
(a) Safe-Harbor. Notwithstanding any other provisions of the Plan,
for purposes of determining the number or identity of Highly
Compensated Employees or for purposes of the pension
requirements of Section 414(n)(3) of the Code, the Eligible
Employees of the Company shall include individuals defined as
Employees in Section 1.21.
(b) Participation and Accrual. A leased employee within the
meaning of Section 414(n)(2) of the Code shall not become a
Participant in, and shall not accrue benefits under, the Plan
based on service as a leased employee.
ARTICLE III
PARTICIPANT CONTRIBUTIONS
3.1 Contributions.
(a) Salary Deferral Contributions. Each Participant may elect to
designate as his Salary Deferral Contribution each payroll
period, a rate of not less than 2% nor more than 10% of his
Compensation, in multiples of 1% for such payroll period.
Salary Deferral Contributions for any calendar year are
limited to the amount specified in Code Section 402(g)(5).
(b) Voluntary Employee Contributions. A Participant who is making
the maximum rate of Salary Deferral Contributions subject to
Company Matching Contributions may elect to contribute
Voluntary Employee Contributions, provided that the sum of the
Participant's Salary Deferral Contributions and Voluntary
Employee Contributions in any Plan Year shall not exceed 15%
of his Compensation. Voluntary Employee Contributions are made
on an after-tax basis.
3.2 Payroll Deductions. Participant contributions shall be made through
reductions in the amount otherwise payable in cash to the Participant
as authorized by the Participant.
3.3 Designation of the Amount of Contributions.
(a) Initiation of Contributions. An Eligible Employee may initiate
contributions to the Plan by following the procedures approved
by the Administrative Committee. The designated rate of
contribution shall be effective on the first day of the month
following the date the Employee authorizes the contributions
in a manner approved by the Administrative Committee.
(b) Change in Eligibility for Matching Contributions. A
Participant may increase this rate of contributions upon the
completion of five years and upon the completion of ten years
of service as an Eligible Employee. The designated rate of
contribution shall be effective on the first day of the month
following the date the Employee authorizes the contributions
in a manner approved by the Administrative Committee.
(c) Change in Contributions. For situations other than those
described in 3.3(a) and 3.3(b), a Participant may change his
rate of contributions. Any changes in the rate of
contributions shall become effective on the first day of the
month following the date the Employee authorizes the change in
a manner approved by the Administrative Committee.
3.4 Suspension of Participant Contributions. A Participant may elect to
suspend his contributions. Such voluntary suspension shall become
effective on the first day of the month following the date the
Employee authorizes the suspension in a manner approved by the
Administrative Committee. If a Participant elects to suspend his
contributions in accordance with the provisions of this Section 3.4,
he shall not be eligible to resume his contributions until the first
day of the fourth month following the month in which his suspension
became effective. When the Participant elects to resume his
contributions, he shall do so in a manner approved by the
Administrative Committee. A Participant shall not be permitted to make
up suspended contributions. Participant contributions shall be
suspended automatically for any payroll period in which the
Participant is not in receipt of Compensation and his contributions
shall not resume until the first day of the month following the month
in which he receives Compensation.
A Participant who is absent from employment on account of an authorized
unpaid leave of absence or a military leave shall automatically have
Participant contributions suspended during such leave. Such suspension
shall become effective on the date such authorized leave begins and
shall remain effective for the entire period of such leave. Such a
Participant shall be eligible to resume contributions immediately upon
return to active employment. Upon reemployment, a Participant serving
in the Uniformed Services shall be permitted to make up contributions
for the period served based on their election in effect immediately
before the leave. The period of repayment is subject to good faith
negotiations between the Company and the Employee.
3.5 Reduction in Salary Deferral Contribution
For any Plan Year, the Actual Deferral Percentage (ADP) for Highly
Compensated Employees may not exceed the greater of Test I or Test II
below:
Test I: 125% of the Actual Deferral Percentage for Non-Highly
Compensated Employees;
Test II: The lesser of (a) 200% of the Actual
Deferral Percentage for Non-Highly Compensated
Employees; or (b) such Actual Deferral Percentage
for Non-Highly Compensated Employees plus two
percentage points.
3.6 Prospective Reduction of Salary Deferral Contributions. The Committee
shall determine periodically whether the amount of Salary Deferral
Contributions elected by the Highly Compensated Employees would exceed
the permissible Actual Deferral Percentage (taking into account Salary
Deferral Contributions elected for the month in question continue in
effect for the remainder of the Plan Year). If so, the amount of
Salary Deferral Contributions allowed to be made on behalf of Highly
Compensated Employees with respect to the remainder of the Plan Year
shall be reduced. The Highly Compensated Employees with respect to
whom such reduction shall be made and the amount of such reduction
shall be determined by reducing the maximum allowable Salary Deferral
Contribution under Section 3.1 from 10% of Compensation to such
percentage which will, when applied to all Highly Compensated
Employees who authorized such Salary Deferral Contributions, result in
the Actual Deferral Percentage set forth in Section 3.5 not being
exceeded. Once a reduction has been made hereunder it shall remain in
effect for the duration of the Plan Year unless the Committee
determines that it is no longer necessary in order for the Actual
Deferral Percentage limitation to be met.
3.7 Retrospective Reduction of Salary Deferral Contributions. In the event
that, notwithstanding Section 3.6 hereof, it is determined by the
Committee during any Plan Year or prior to the due date, including
extensions, for filing the Company's federal income tax return for
such Plan Year, that the limitations contained in Section 3.5 have
been exceeded for that Plan Year, then the Salary Deferral
Contributions that have been made on behalf of the Highly Compensated
Employees shall be reduced in the manner prescribed in Section 3.6
above and recharacterized as Voluntary Employee Contributions. Any
earnings accrued on the amount by which a Participant's Salary
Deferral Contributions are reduced shall be treated as earnings
attributable to the Participant's Voluntary Employee Contributions.
Recharacterized excess contributions will remain subject to the
nonforfeitability requirements and distribution limitations that apply
to elective contributions.
Failure to correct excess contributions by the close of the Plan Year
following the Plan Year for which they were made will cause the cash or
deferred arrangement to fail to satisfy the requirements of Section
401(k)(3) for the Plan Year for which the excess contributions were
made and for all subsequent years they remain in the trust. The
Employer will be liable for a 10% excise tax on the amount of excess
contributions unless they are corrected within 2 1/2 months after the
close of the Plan Year for which they were made.
3.8 Remittance of Participant Contributions. Amounts deducted as
Participant contributions shall be remitted to the Trustee as soon as
practicable after the end of each month, but in any event no later than
the 15th business day of the month following the month in which the
amounts would otherwise have been payable to the participant in cash.
3.9 Rollover Contributions. A Participant may transfer to the Plan a
qualified total distribution, as defined in Section 402(a)(5)(E)(i) I
or II of the Code, provided that such distribution is from a plan which
meets the requirements of Section 401(a) of the Code ("Other Plan") and
that the following conditions are satisfied:
(a) The amount of the rollover must be in the form of cash or cash
equivalent;
(b) The rollover occurs on or before the 60th day following the
Employee's receipt of the distribution from the Other Plan;
and
(c) The amount of the rollover does not exceed the maximum
rollover amount permitted under the provisions of Section
402(a)(5)(B) of the Code, which limit such amount to the fair
market value of all property received in such distribution
reduced by Employee Contributions, as defined in Section
402(a)(5)(E)(ii) of the Code.
A Participant, who has previously transferred a distribution from
another plan into an individual retirement account ("IRA"), may roll
over the amount of such distribution, plus earnings thereon, from the
IRA to the Plan; provided that such distribution is transferred to the
Plan as a Rollover Contribution on or before the 60th day following
receipt thereof from the IRA, and such Rollover Contribution complies
with Section 408(d)(3) of the Code.
The Administrative Committee shall develop such procedures and may
require such information from a Participant desiring to make Rollover
Contribution as it deems necessary or desirable to determine that the
proposed Rollover Contribution will meet the requirements of this
Section 3.9. Upon approval by the Administrative Committee, the amount
of the Rollover Contribution shall be deposited in the Plan and shall
be credited to the Participant's rollover account. The amount of the
Rollover Contribution credited to such Account shall be 100% vested in
the Participant and shall share in the appropriate investment
earnings.
ARTICLE IV
COMPANY CONTRIBUTIONS
4.1 Company Contribution.
(a) Fixed Contributions. The Company shall contribute to each
Participant's Account an amount equal to 1% of the
Compensation for each Eligible Employee for each Plan Year or
portion of the Plan Year that the Eligible Employee is a
Participant. Such Fixed Contribution shall continue for as
long as the Eligible Employee is receiving Compensation from
the Company. Fixed contributions are payable from Current or
Accumulated Profits as provided in Section 4.12.
(b) Company Matching Contribution. The Company shall make a
monthly minimum contribution to each Participant Account in an
amount equal to $0.50 for each $1.00 of a Participant's Salary
Deferral Contributions subject to match in accordance with
(d).
(c) Mandatory Additional Company Matching Contribution. As soon as
practicable after the close of the Plan Year, the Company
shall determine the ratio of pre-tax income to equity for such
year and make a Mandatory Additional Company Matching
Contribution to each Participant Account on behalf of each
Participant for each $1.00 of Salary Deferral Contributions in
an amount determined as follows:
Ratio of Pre-Tax
Income to Equity Mandatory Additional Matching Contribution
Up to 15.0% None
15.0% to 15.9% $0.10 for each $1.00 of
Salary Deferral Contribution
16.0% to 16.9% $0.20 for each $1.00 of
Salary Deferral Contribution
17.0% to 17.9% $0.30 for each $1.00 of
Salary Deferral Contribution
18.0% to 18.9% $0.40 for each $1.00 of
Salary Deferral Contribution
Over 19.0% $0.50 for each $1.00 of
Salary Deferral Contribution
(d) Maximum Company Matching Contributions. The Company shall
match a portion of a Participant's Salary Deferral
Contributions in accordance with (b) and (c) above, but in no
event shall the total Company Matching Contribution for any
Participant exceed the following percentage of Compensation:
Years of Service Percentage of Compensation
as an Eligible Employee
1 but fewer than 5 4%
5 but fewer than 10 5%
10 or more 6%
(e) Discretionary Contributions. The Company may make a
Discretionary Contribution for any Plan Year of an amount out
of, and not in excess of, the Current or Accumulated Profits
as its Board of Directors shall determine by resolution
adopted before the last day of the Plan Year.
Any such Discretionary Contribution to the Plan for any Plan
Year shall be allocated proportionately among the accounts of
the Eligible Employees who are credited with a Year of Service
for employment with a Company for such Plan Year. Each
Eligible Employee shall receive one unit for each full $100 of
Compensation plus one unit for each Year of Service as an
Eligible Employee. Each Eligible Employee's proportionate
share, which will be invested in the Company Common Stock
option, shall equal the sum of his units divided by the sum of
all Eligible Employees units multiplied by the Discretionary
Contribution.
(f) Upon reemployment of an Employee serving in the Uniformed
Services, the Employer will make the Company Fixed
Contribution and the Discretionary Contribution to the Plan on
behalf of the Employee, as if the Employee had continued
active employment. The Company will make the Company Matching
Contribution if the Employee makes the appropriate Salary
Deferral Contributions to the Plan during the repayment
period.
4.2 Matching of Recharacterized Contributions. In the event that any Salary
Deferral Contributions are recharacterized as Voluntary Employee
Contributions pursuant to Section 3.6 and, at the time it is determined
by the Committee that such recharacterization is necessary, the Company
Matching Contribution that has been allocated with respect to such
amount shall become a forfeiture and reallocated in accordance with
Section 4.4 and no further matching contribution that might be made
under Section 4.1 shall be allocated to the Participant's Account with
respect to such amount.
4.3 Remittance and Investment of Company Contributions. The Company
Contribution as described under Sections 4.1(a), and 4.1(b), and
limited by Section 4.1(d) shall be transmitted to the Trustee as soon
as practicable after the end of each calendar month.
4.4 Forfeitures of Company Contributions. Amount forfeited by Participants
in accordance with Section 7.2 that are attributable to Discretionary
Contributions shall be credited to the Accounts of all Participants
based on the ratio of each Participant's Company Discretionary
Contribution for the year to the sum of all Participants' Company
Discretionary Contribution for the year. If the Plan shall be
terminated or suspended, any amount not previously so applied shall be
credited to the Accounts of all Participants at the time of
termination or suspension, based on the ratio of each Participant's
Company Discretionary Contribution of the year to the sum of all
Participant's Company Discretionary Contribution for the year. Any
other amounts forfeited in accordance with Section 4.2 or 7.2 shall be
applied to reduce the next Company Contribution under any provision of
the Plan.
4.5 Effect of Suspension of Participant Contributions on Company
Contributions. No Company Matching Contributions shall be made to the
account of a Participant during any period in which a Participant makes
no Salary Deferral Contributions.
4.6 Limitations on Contributions. Contributions made by the Company on
behalf of any Participant shall be limited to the maximum amount
permitted under the Code as follows:
(a) The annual addition to any Participant's Account, when added
to similar additions under other defined contribution plans
maintained by the Company and Affiliated Companies, shall no
exceed the lesser of $30,000 (or such other amount as
determined by the Secretary of the Treasury) or 25% of such
Participant's annual limitation compensation.
.
(b) Section 415(e) of the Code prescribes aggregate limitations
for those Employees who participate in both the Plan and a
defined benefit plan. If, for any Plan Year, the limitations
prescribed in Section 415(e) of the Code are exceeded, the
benefit payable under the pension plan shall be reduced to
meet the limitations.
(c) In the event that it is determined that the contributions made
on behalf of any Participant for any Plan Year are in excess
of the limitations set forth in this Section 4.6, such
contributions shall be reduced in the following order:
(1) Voluntary Employee Contributions;
(2) Salary Deferral Contributions not eligible for Company
Matching Contributions.
(3) Salary Deferral Contributions eligible for Company Matching
Contributions and corresponding Company Matching Contribu-
tions in equal proportions;
(4) Company Discretionary Contributions;
to the extent necessary to bring such contributions within the
limitation set forth herein.
(d) Definitions. For purposes of this Section 4.6, the following
definitions shall apply: (1) Annual additions shall mean the
sum of Company Contributions, Salary Deferral Contributions,
Voluntary Employee Contributions and reallocated forfeitures.
(2) Compensation means the amount as determined under
Regulation Section 1.415-2.
4.7 Company Contribution Limitation. For any Plan Year, the Actual
Contribution Percentage (ACP) for the Highly Compensated Employees may
not exceed the greater of Test I or Test II:
Test I: 125% of the Actual Contribution Percentage for all
eligible Non-Highly Compensated Employees;
Test II: The lesser of (a) 200% of the Actual Contribution
Percentage for all eligible Non-Highly Compensated
Employees; or (b) the Actual Contribution Percentage
for all eligible Non-Highly Compensated Employees
plus two percentage points.
4.8 Prospective Reduction of Contributions. In the event that it is
determined that the amount of matching contributions and Voluntary
Employee Contributions made to the Participant Account of the Highly
Compensated Employees would cause the Actual Contribution Percentage
described in Section 4.7 to be exceeded (taking into account the
contributions made during the prior months of the Plan Year and
assuming that the rate of contributions continues in effect for the
remainder of the Plan Year), then the amount of matching contributions
and Voluntary Employee Contributions allowed to be made by and on
behalf of the Highly Compensated Employees with respect to such month
shall be reduced. The Highly Compensated Employees with respect to
whom such reduction shall be made and the amount of such reduction
shall be determined by reducing the maximum allowable matching
contributions and Voluntary Employee Contributions to the extent that
the Actual Contribution Percentage set forth in Section 4.7 is not
being exceeded.
4.9 Retrospective Reductions of Contributions. In the event that,
notwithstanding Section 4.8 hereof, it is determined by the Committee
during any Plan Year or prior to the due date including extensions,
for filing the Company's federal income tax return for such Plan Year,
that the Actual Contribution Percentage, as initially determined, has
been exceeded, then the matching contributions and Voluntary Employee
Contributions that have been made by and on behalf of the Highly
Compensated Employees shall be returned to the Participant, along with
the earnings associated with such contributions. The amount to be
returned shall be determined by first reducing the Participant(s) in
the group of Highly Compensated Employees with the highest individual
Actual Contribution Percentage(s) to the next lower one percent, and
then repeating such reduction with respect to such Participant(s) to
the extent necessary to assure that the limitation will be satisfied
for the Plan Year. Notwithstanding anything in the above to the
contrary, a Highly Compensated Employee who is not yet vested in
accordance with Section 7.2 shall forfeit the amount of matching
contributions instead of having such contributions paid to him.
4.10 Aggregate Limit on Actual Deferral Percentages. In the event that Test
II is used under both Sections 3.5 and 4.7, the aggregate limit may not
exceed the greater of (a) or (b):
(a) The sum of (1) and (2) as follows:
(1) 125% of the greater of (A) the Actual Deferral
Percentage in Section 3.5 of the group of Non-Highly
Compensated Employees eligible to make Salary
Deferral Contributions for the Plan Year, or (B) the
Actual Contribution Percentage of the group of
Non-Highly Compensated Employees eligible to receive
Company Contributions in the Plan Year; plus
(2) Two plus the lesser of (a)(1)(A) or (a)(1)(B) above.
In no event, however, shall this amount exceed 200%
of the lesser of (a)(1)(A) or (a)(2)(B).
(b) The sum of (1) and (2) below:
(1) 125% of the lesser of (A) the Actual Deferral
Percentage in Section 3.5 of the group of Non-Highly
Compensated Employees eligible to make Salary
Deferral Contributions for the Plan Year, or (B) the
Actual Contribution Percentage of the group of
Non-Highly Compensated Employees eligible to receive
Company Contributions in the Plan Year; plus
(2) Two plus the greater of (b)(1)(A) or (b)(1)(B) above.
In no event, however, shall this amount exceed 200%
of the greater of (b)(1)(A) or (b)(1)(B).
In the event that the aggregate limit described in this Section 4.10 is
exceeded at the end of the Plan Year, certain Participants in the group
of Highly Compensated Employees may have certain of their contributions
returned, along with the earnings associated with such contributions,
in accordance with the provisions of Section 4.9.
The distribution of such excess contributions, along with the earnings
associated with such contributions, will be made by the March 15
following the calendar year in which the excess contributions were
made.
4.11 Return of Contributions. In the event that a contribution is made to the
Plan:
(a) Under a mistake of fact; or
(b) Conditioned upon deduction of the contribution under Code
Section 404 and such deduction is disallowed, the contribution
shall be returned to the Company within one year after the
payment of the contribution or the disallowance of the
deduction (to the extent disallowed), whichever is applicable,
in such form as may be prescribed by regulations issued by the
Secretary of the Treasury.
All Company Contributions and Salary Deferral Contributions are hereby
conditioned on their deductibility under the Code.
4.12 Contributions Limited to Profits. All Company Contributions to the
Plan, including Salary Deferral Contributions and Company Matching
Contributions, shall be made out of Current or Accumulated Profits.
Should there be insufficient Current or Accumulated Profits,
contributions shall be reduced in such manner as the Company
determines. Each Company shall make contributions only with respect to
its own Employees; provided, however, that in the event that any one
Company is prevented from making all or part of the contribution which
it otherwise would have made under the Plan, by reason of having no
Current or Accumulated Profits or because its Current or Accumulated
Profits are insufficient to make the required contribution, then the
contribution which the Company was prevented from making may be made
for such Company by the other Companies, consistent with the
applicable deduction rules prescribed under Section 404 of the Code.
4.13 Contributions Limited to Amount Deductible. Company Contributions,
including Salary Deferral Contributions and matching contributions,
shall not be made to the Plan to the extent they would exceed the
maximum amount deductible by the Company under Code Section 404. In the
event that it is determined that the deductible limits would be
exceeded, contributions shall be reduced in such manner as the Company
shall prescribe.
ARTICLE V
PARTICIPANT ACCOUNTS
5.1 Participant Accounts. Each Participant Account shall separately account for
the value of:
(a) Salary Deferral Contributions;
(b) Voluntary Employee Contributions;
(c) Fixed Contributions;
(d) Company Matching Contributions;
(e) Discretionary Contributions;
(f) Prior Plan contributions; and
(g) Any rollover deposits.
Each such account shall reflect the income, losses, appreciation and
depreciation attributable to such items as are allocated to such
account. Separate investments are not required to be maintained for any
Participant Account.
5.2 Valuation of Assets. At each Valuation Date in which the Plan is in
operation, the Trustee and/or the Investment Company shall determine
the total fair market value of all assets then held in the Fund.
5.3 Investment of Contributions. Each Participant shall direct that his
Participant Account be invested in one or more of the investment funds
held by the Trustee.
The Employer may enter into a written agreement with one or more
Investment Manager(s), pursuant to which such Investment Manager(s) may
permit the Participants to direct the investment of the Participants'
Accounts held in the Trust in one or more group or common trust funds
managed by the Investment Manager(s). Such funds may include, but shall
not be limited to (a) Growth and Income Fund, (b) Pure Growth Fund, (c)
Equity Fund, (d) GIC Fund, (e) Bond Fund, and (f) Money Market Fund.
The employer may, from time to time, make available additional or
alternative investment funds, or replace or suspend one of the above
funds. The Investment Manager(s), at the Participant's request and
within one month after an Employee becomes a Participant, shall provide
each Participant with a complete description of the Funds.
No less frequently than once each calendar quarter, the investment
returns attributable to each investment fund are allocated to each
Account within the investment fund in the same proportion that such
Account balance for such month bears to the total Account balances for
such month. The Account balance shall be determined by debiting the
prior quarter's Account balance for any withdrawals, transfers out of
such Account and loans made from the Account and crediting the prior
quarter's Account balance with transfers to the Account and loans
repaid to the Account.
5.4 Change in Future Investment Elections. Any investment election given by
a Participant for investment of the contributions will continue in
effect until changed by the Participant. A Participant shall notify the
Administrative Committee or its designee of the change as prescribed by
the Committee.
5.5 Conversion of Past Investment Elections. A Participant may elect to
transfer all or a portion of the value of his Account invested in a
fund in accordance with uniform and nondiscriminatory rules prescribed
by the Committee or its designee effective as of the date the Trustee
makes such transfer.
5.6 Effect of Reemployment. Subject to the provision of Article X, if a
Participant terminates his employment and begins to receive a
distribution under this Plan and, prior to the time his Participant
Account shall have been fully distributed to him, he is reemployed by
the Company, then, in such event, his right to further payments from
his Participant Account shall cease and such undistributed amount shall
be retained for his benefit until he thereafter terminates his
employment with the Company.
5.7 Statements of Participant Accounts. No less frequently than once in
each Plan Year, each Participant shall receive a statement of his
account balance and his nonforfeitable right, if any, to his account
balance.
5.8 Investment of Prior Plan Contributions. As of June 30, 1984, all
amounts attributable to contributions to the Prior Plan were invested
in an annuity contract (the "Prior Plan Annuity Contract"). The
portion of the Prior Plan Annuity Contract which has not been
transferred into the current funds shall be transferred to and
invested in the funds as the balance become available. The amounts
transferred will be invested in the funds in the same manner as the
Participant has elected under Section 5.3. In the absence of a
designation by the Participant, the amount transferred shall be
invested in the Money Market Fund. Any amounts not attributable to a
Participant Account (i.e., due to forfeiture) shall be invested in the
Money Market Fund until reallocated.
ARTICLE VI
WITHDRAWALS AND LOANS
6.1 Election and Form of Withdrawal. A Participant may elect to make a
withdrawal from his Account by authorizing the withdrawal in a manner
approved by the Administrative Committee. Such an election shall take
effect on the first day of a month following completion of required
procedures. The amount withdrawn shall be paid to the Participant in
the form of a single cash payment, and no amount withdrawn may be
repaid to the Plan. No more than one withdrawal may be made in any
12-month period and no withdrawal shall be less than $1,000.
6.2 Order of Withdrawal. No withdrawal may be made from the portion of a
Participant Account representing matching contributions made under the
Prior Plan or Salary Deferral Contributions made pursuant to Section
4.1(a). A Participant may make a withdrawal of any whole dollar amount
from all or any portion of the categories described below. In the
absence of any contrary written election by the Participant,
withdrawals shall be deemed to be made in the following order:
(a) Any rollovers made to the Plan, other than rollovers from a
defined benefit plan, and the lesser of the voluntary and
mandatory contributions to the Prior Plan or the net amount of
such contributions;
(b) The interest of the voluntary and mandatory contributions to
the Prior Plan and Voluntary Employee Contributions; and
(c) The vested interest in a Participant Account attributable to
Company Matching Contributions, Fixed Contributions and
Discretionary Contributions made to the Plan; provided,
however, that in no event shall the amount of a withdrawal
made by any Participant who has completed fewer than five
Years of Service as of the effective date of the withdrawal
include any Company Matching Contributions, Fixed
Contributions or Discretionary Contributions, or the earnings
attributable to such contributions, that have not been held in
the Trust for at least the 24-month period prior to such
effective date.
6.3 Source of Withdrawal Proceeds. The Fund from which a withdrawal is made
shall be determined by the Committee after consultation with the
Participant.
6.4 Restriction on Amount of Withdrawal if a Loan is Outstanding. In no
event will a withdrawal from the Plan be permitted in an amount greater
than the value of the Participant's vested interest, determined as of
the Valuation Date immediately preceding withdrawal, less 200% of the
then outstanding loan balance (including principal and interest) of any
loan granted to the Participant.
6.5 Amount of Loan. A Participant (including those on leave of absence,
long-term disability, or who are currently employees on an hourly
basis but who, prior to becoming hourly employees, were Participants
in the Plan) may obtain a loan from his Account, excluding the portion
of his Account attributable to matching contributions to the Prior
Plan and the portion attributable to Company Matching Contributions,
Fixed Contributions and Discretionary Contributions in which he is not
vested. The minimum amount of any loan shall equal $1,000. The maximum
amount of any loan, when added to the outstanding principal balance of
any other loan, shall in no event exceed 50% of a Participant's vested
Account balance up to a maximum of $50,000 (reduced by the excess, if
any, of highest outstanding loan balance during the preceding 12-month
period over the outstanding balance of loans from the Plan on the date
the loan was made.)
6.6 Application for a Loan. A Participant may apply for a loan by
completing the procedures approved by the Administrative Committee.
Unless an exception to the normal processing is requested by the
Participant and is approved by the Committee, loans are approved as of
the first day of any calendar quarter following procedures as approved
by the Administrative Committee. The amount borrowed by the
Participant shall be paid to him as soon as administratively possible
after the first day of the calendar quarter. The Spouse of a married
Participant must consent to the loan and to the possible reduction of
benefits pursuant to Section 6.9.
6.7 Promissory Note. As evidence of a loan, a Participant shall provide a
promissory note to the Trustee in a form prescribed by the Committee.
The rate of interest shall be the sum of the prime rate at a bank
specified by the Committee plus one-half percent. Such interest rate
shall remain fixed for the full term of the loan. Payments due under
the note shall be level amortization payments, payable no less
frequently than quarterly.
6.8 Source of Loan Proceeds. A loan to a Participant shall be made from the
Participant's Account, and such Account shall be reduced by the amount
of any unpaid loan. In the event that a Participant's Account is
invested in more than one investment fund, the investment fund(s) from
which the loan shall be made shall be determined by the Participant.
6.9 Security. As security for a loan, a Participant's promissory note shall
be secured by his Account in the Plan. A married Participant must
provide the Committee with the written consent of his Spouse in order
to secure the loan with his Account. If, before a loan is repaid, the
Participant's employment is terminated and he or his beneficiary
becomes entitled to a distribution from the Plan, the unpaid principal
balance of the loan shall be offset from the distribution otherwise
payable.
6.10 Administrative Charge. An administrative charge shall be deducted from
the Participant's Account for the initial processing of the loan and
also with respect to each Plan Year in which he has a loan balance
outstanding.
6.11 Repayment. A Participant's note ordinarily shall be repaid by payroll
deduction in such amounts as are determined by the Committee. Each
payment shall be credited to the Participant's Account and shall be
invested in accordance with the Participant's investment designation
in effect under Section 5.3 at the time the payment is so credited. A
loan shall be required to be repaid within 60 months from the date on
which the loan originally is made; provided, however, that the
repayment period for a loan that is used to acquire a dwelling unit
which is to be used as a principal residence of the Participant may be
as long as 360 months from the date on which the loan is originally
made. Loans may be repaid without penalty at any time. In addition to
regularly scheduled payments, partial payments made to reduce the
outstanding loan balance may be made once each calendar year.
6.12 Default. If a Participant shall fail to make any installment payment
or the annual administrative charge on a loan within 30 days after the
due date of such payment, then the Committee will accelerate repayment
of the loan and demand immediate repayment of the principal and
interest due. If the Participant fails to comply within 30 days, the
Committee shall reduce the Participant's vested Account balance, as
permitted by law, in order to recover the outstanding loan balance
plus interest due. At the time of disbursement of benefits, the
balance, including interest, will be deducted from the disbursement.
6.13 Loan Administration. The loan provisions under this Article VI shall
be administered by the Committee.
ARTICLE VII
VESTING AND TERMINATION OF EMPLOYMENT
7.1 Salary Deferral Contributions and Rollover Deposits. A Participant will
at all times be 100% vested in his Participant Account attributable to
Salary Deferral Contributions, Voluntary Employee Contributions
and rollover deposits.
7.2 Company Contributions. A Participant shall vest in his account balance
attributable to Company Contributions in accordance with the following
schedule:
Years of Service Vesting Percentage
fewer than 5 years 0%
5 years or more 100%
Any Participant who had completed three or more Years of Service as of
July 1, 1989 will be subject to the following vesting schedule:
Completed Years of Service Vesting Percentage
3 30%
4 40%
5 100%
Any amounts not vested upon termination will be forfeited at the end of
the Plan Year following such Participant's termination unless the
Participant returns to employment prior to incurring a five-year long
Break in Service, in which case forfeited amounts shall be restored.
Notwithstanding the above paragraph, if a Participant terminates his
employment by reason of Retirement, Disability or death, the
Participant's entire Participant Account shall be nonforfeitable. A
Participant's entire Participant Account shall also become
nonforfeitable upon his attainment of Normal Retirement Age.
7.3 Distributions. Upon a Participant's termination for any reason other
than Retirement, Disability or death, he may elect to receive a
distribution of the portion of his vested Account balance. If the
Participant's Accrued Benefit is $3,500 ($5,000 on or after 1/1/98) or
less, the distribution shall be made within a reasonable period after
the Participant's termination of employment but in no event later than
April 1 of the calendar year following the end of the Plan Year in
which his Break in Service occurs. The Participant shall have the sole
right to elect the form of distribution subject to the terms and
conditions of Article IX. Upon the occurrence of a Break in Service
following a Participant's termination of employment for any reason
other than Retirement, Disability or death, a Participant whose
Account balance is $3,500 ($5,000 on or after 1/1/98) or less shall
receive a total distribution of the balance of his vested Account
balance as of the date valued by the Trustee following the date of the
Break in Service. The distribution shall be subject to the terms and
conditions of Article IX. Payment to the Participant shall commence
not later than the Valuation Date next following the Participant's
65th birthday and any Participant who has completed at least five
Years of Service may elect to begin payments on or after the Valuation
Date next following his 55th birthday.
7.4 Distributions Prior to a Break in Service. A Participant whose
employment is terminated prior to his Retirement and who is entitled
to a cash lump sum distribution may elect to receive the entire vested
Account balance as of the date valued by the Trustee following his
termination of employment without regard to whether he has incurred a
Break in Service. In such event, that portion of his Account which is
not vested as of the date of distribution shall be forfeited;
provided, however, that if the Participant resumes employment covered
under the Plan, the portion of his Account which was attributable to
Company Matching Contributions, Fixed Contributions and Discretionary
Contributions as of the date of distribution, unadjusted for any
subsequent gains or losses, shall be restored if he repays to the Plan
the amount distributed which is attributable to Company Matching
Contributions which would not have been eligible to be withdrawn
pursuant to Article VI. Such repayment must be made not later than the
date on which the Participant has incurred a five-year Break in
Service.
ARTICLE VIII
TRANSFER
If a Participant shall cease to be an Eligible Employee of the Company, but
shall continue to be employed by the Company or any other corporation which is a
member of a controlled group of corporations (determined in accordance with
Section 414(b) of the Code), his contributions shall cease, the Company
Contributions made on his behalf shall cease, and such Participant shall have
the right to make withdrawals as provided in Article VI and distributions as
provided in Article IX. When such Participant subsequently ceases to be an
Employee, the extent to which he shall be entitled to his Participant Account
shall be determined in accordance with the provisions of Article VII.
ARTICLE IX
DISTRIBUTION OF BENEFITS
9.1 Retirement or Disability. The amount of a Participant's Account shall
be determined as of the valuation date next preceding actual
distribution. Payment of benefits shall be made in accordance with the
provisions of this Article.
9.2 Death. If a Participant dies while in the employment of the Company,
the amount of his Participant Account shall be nonforfeitable. Payment
of benefits shall be made to the Participant's Spouse in accordance
with the provisions of Section 9.4, Section 9.6 and Section 9.7, unless
a beneficiary has been elected in accordance with the provisions of
Section 9.8.
9.3 Form of Distribution. Any distribution of any portion of a Participant
Account made coincident with or following a Participant's death,
Disability, Retirement or termination of employment shall be
distributed in one of the following methods subject to Section 9.8, as
selected by the Participant or beneficiary by filing the appropriate
form with the Trustees:
(a) In a single lump sum in cash;
(b) Direct rollover to an eligible retirement plan; or
A direct rollover is a payment by the plan to an eligible retirement
plan specified by the Participant. For purposes of making a
distribution, Participant includes an employee or former employee or
the employee's or former employee's surviving spouse or designated
beneficiary or the employee's or former employee's former spouse who
is an alternate payee under a qualified domestic relations order as
defined in Section 414(p) of the Code.
An eligible retirement plan is an individual retirement account
described in Section 408(a) of the Code, an individual retirement
annuity described in Section 408(b) of the Code, an annuity plan
described in Section 403(a) of the Code, or a qualified trust
described in Section 401(a) of the Code, that accepts the
Participants' 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.
An eligible rollover distribution is any distribution of all or any
portion of the Participant's account balance, 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 Participant or the joint lives (or joint life expectancies) of the
Participant's designated beneficiary, or for a specified period of ten
years or more; any distribution to the extent such distribution is
required under Section 401(a)(9) of the Code; and the portion of any
distribution that is not includible in gross income (determined
without regard to the exclusion for net unrealized appreciation with
respect to employer securities.)
(c) The Trustees, upon agreement with the Participant and subject
to the provisions of Section 9.8, shall apply the Participant
Account to the purchase of an annuity contract issued by an
insurance company.
If a Participant fails to elect a form of distribution, the
distribution shall be payable in a joint and survivor annuity if the
Participant is married or a life annuity if the Participant is single.
The Trustees shall distribute a notice describing the forms of
distribution available under the Plan at least 90 days before a
Participant's payments are scheduled to commence. The Participant shall
inform the Trustees of his preferred distribution form.
If a Participant's account balance is greater than $3,500 ($5,000 on or
after 1/1/98), an immediate distribution will not be made without the
consent of the Participant and, where applicable, the Participant's
spouse. An immediate distribution means the distribution of any part of
the benefit prior to the later of age 62 or normal retirement age.
9.4 Payments to a Beneficiary. Unless an annuity has already been purchased
(in which case the form of payment will be in accordance with the
annuity contract), payment of benefits under Section 9.2 to a
beneficiary shall be made in the form of payment elected by the
beneficiary in accordance with Section 9.3 subject to the limitations
set forth in Section 9.8.
Payment may be deferred until the date that the Participant would have
attained age 70-1/2, provided that the beneficiary is the Participant's
Spouse.
9.5 Small Payments. If the value of the Participant Account is less than
$3,500 ($5,000 on or after 1/1/98), the Trustee shall direct that such
lump value be paid in full discharge of all liability under the Plan.
9.6 Commencement of Benefit Payments. Unless the Participant otherwise
elects, the payment of benefits shall commence no later than 60 days
after the close of the Plan Year in which occurs the later of the
Participant's Normal Retirement Date or his termination of employment.
In no event shall distribution commence later than April 1 of the
calendar year following the calendar year in which the Participant
attains age 70-1/2; provided, however, that in the case of a
Participant who has attained age 70-1/2 before January 1, 1988, and is
not a five percent owner (within the meaning of code Section 416) at
any time during the Plan Year ending with or within the calendar year
in which he attains age 66-1/2 and in any subsequent Plan Year,
distribution shall commence no later than April 1 of the calendar year
following the later of the calendar year in which the Participant
attains age 70-1/2 or terminates his employment with the Company. If a
distribution is one to which Sections 401(a)(11) and 417 of the Code
do not apply, such distribution may commence less than 30 days after
the notice required under Code Regulation Section 1.411(a) - 11(c),
provided that:
(1) 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
(2) the Participant, after receiving the notice, affirmatively elects a
distribution.
9.7 (a) Distributions to Married Participants. In the event that a
Participant is married on the date his distribution payments
are to begin, he shall receive his benefits in the form of a
joint and survivor annuity unless he completes the election
described below within 90 days of the date his benefit
payments are to begin. If he does so elect, he may request his
benefits to be paid out in one of the payment forms described
in Section 9.3.
An election to waive a joint and survivor annuity shall be
effective only if made in accordance with Section 9.8.
At least 120 days prior to the date his benefit payments are
to commence, the Trustees shall inform the Participant of (1)
the terms and conditions of the joint and survivor annuity
form and the alternative payment forms, (2) the ability to
waive the joint and survivor annuity form (and the procedure
to do so), and (3) the ability to revoke such a waiver.
(b) Death Benefits: Married Participants.
(1) Preretirement Spousal Death Benefit. In the event
that a married Participant dies before he has begun
to receive his benefit payments and he has not made
an election pursuant to subsection (2) below, his
surviving Spouse shall receive a death benefit equal
to 100% of the balance of his Participant Account
payable in a single life annuity or in a single lump
sum in cash.
(2) Election to Waive the Preretirement Spousal Death
Benefit. A Participant may elect to waive the benefit
described in (1) above if, at some point after he has
either attained age 35 or terminated employment,
whichever comes first, he makes an election to waive
the benefit. Such waiver shall be effective only if
made in accordance with Section 9.8.
(3) Information to Participants. The Committee shall inform each
Participant of (A) the terms and conditions of the preretirement
spousal death benefit and the distribution alternatives, (B) the
ability to waive such benefit (and the procedure to do so), and (C)
the ability to revoke such waiver. Such information must be provided
to a Participant in whichever of the following periods ends last (A)
between the Plan Years in which he attains age 32 and age 35, (B) a
reasonable period after the individual becomes a Participant, (C) a
reasonable period after the individual is married, (D) a reasonable
period after separation from service in the case of a Participant who
separates before attaining age 35, or (E) a reasonable period after
the individual elects distribution in the form of a life annuity.
(c) Death Benefits: Married Participants Making an Election
Described in (b)(2) and Unmarried Participants. The account
balance of either a Participant who is not married on the date
of his death or of a Participant who has waived the benefit
described in (b)(1) by making the election described in (b)(2)
and whose payment has not commenced shall be paid upon his
death to his beneficiary. Such payment shall be made as soon
as practicable after the Participant's death.
9.8 Selection of Beneficiary. Each Participant, by signing a form approved
by the Committee, may designate any person or persons (who may be
designated concurrently, contingently or successively) to whom his
benefits under the Plan are to be paid if he dies before he receives
all of such benefits. The beneficiary of a married Participant must be
such Participant's Spouse unless the Spouse consents to the election.
Spousal consent shall be effective only if (a) it is in writing, (b)
it designates a beneficiary or a form of benefits which may not be
changed without spousal consent, (c) it is accompanied by the written,
signed consent of the Participant's Spouse, (d) the Spouse's signature
is witnessed by a Plan representative or a notary public, and (e) the
consent comports with all other requirements of applicable law.
Notwithstanding anything herein to the contrary, no consent shall be
required if the Committee is satisfied that the Participant's Spouse
cannot be located. An election made pursuant to this subsection may be
revoked at any time prior to the date of distribution. The consent of
the Spouse shall be effective only as to the Spouse who signs the
consent. In the event that a Participant changes an election which
contains spousal consent, the spousal consent shall be ineffective
unless a new consent is executed; the spousal consent is otherwise
irrevocable. A beneficiary designation form will be effective only
when the executed form is filed with the Committee while the
Participant is alive and will cancel all beneficiary designation forms
previously filed by the Participant.
Payment of the death benefit shall be in any method or methods
discussed in Section 9.3 as shall be chosen by the beneficiary,
provided, however, that if the Participant dies after distribution of
his interest has commenced, the remaining portion of such interest will
continue to be distributed in accordance with the option elected under
Section 9.3.
If a Participant fails to designate a beneficiary before his death as
provided herein, or if the beneficiary designated by a deceased
Participant dies before him of before complete distribution of his
benefits, the Committee shall authorize distribution of the
Participant's benefits to the legal representative of the estate of the
last to die of the Participant or his beneficiary, as appropriate.
9.9 Minimum Distribution Amount. Notwithstanding any provision of the
Plan, the amount to be distributed each year, beginning with the year
which is required in accordance with Section 9.6, must not be less
than the lesser of the remaining balance in the Participant Account or
the amount equal to the quotient obtained by dividing the balance in
the Participant Account at the beginning of every such year by the
life expectancy of the Participant or the joint life and last survivor
expectancy of the Participant and the beneficiary, if applicable.
However, no distribution need be made in any year, or a lesser amount
may be distributed if, beginning with the year that distributions
began, the aggregate amounts distributed by the end of such year are
at least equal to the aggregate of the minimum amounts required to
have been distributed by the end of such year in accordance with the
preceding sentence.
9.10 Transfers to Other Qualified Plans and IRAs. Upon retirement or
termination of employment, a Participant may elect that all or a
portion of the value of his Participant's Account may be transferred
to another qualified plan meeting the requirements of Section 401(a)
of the Code and which makes provisions for receiving such transferred
assets or to an individual retirement account (including, for this
purpose, an individual retirement annuity) established for the benefit
of the Participant and meeting the requirements of Section 408 of the
Code. Upon receipt of written instructions from the Committee
containing the information necessary to effect such transfer, the
Trustee and any applicable insurance company shall, for the benefit of
the Participant, and subject to the terms and conditions of any
applicable annuity contract, so transfer such assets.
9.11 Payment of Benefits to an Alternate Payee. A Qualified Domestic
Relations Order, as defined in Section 414(p) of the Code, which
creates or recognizes the existence of an alternative payee's right
to, or assigns to an alternate payee, the right to receive all or a
portion of a Participant's benefit under the Plan, shall not alter the
amount or form of benefits payable under the Plan. A Qualified
Domestic Relation Order shall not be treated as failing to meet this
paragraph if payment to such alternate payee are made before the
Participant has separated from service, but after the date on which
the Participant would have been eligible for a benefit upon
termination or retirement.
ARTICLE X
ADMINISTRATION
10.1 Allocation of Responsibility for Plan Administration. The
Administrative Committee shall have only those specific powers,
duties, responsibilities and obligations as are specifically given
under this Plan. In general, the Company shall have the sole
responsibility for making the contributions provided for under Section
4.1, and the Company shall have the sole authority to enter into a
contract with any Investment Company and to remove such Investment
Company. The Administrative Committee shall have the sole
responsibility for the administration of this Plan. The Trustee shall
have the responsibility for the administration of the Plan assets. The
Administrative Committee and Trustee may rely upon the direction,
information or actions of each other as being proper under this Plan,
and are not required under this Plan to inquire into the propriety of
any such direction, information or action. It is intended under this
Plan that the Administrative Committee and Trustee shall be
responsible for the proper exercise of their own powers, duties,
responsibilities and obligations under this Plan and shall not be
responsible for any act or failure to act of each other, except to the
extent required by law.
10.2 Appointment of Committee. The Administrative Committee shall consist of
not less than one nor more than seven members who shall be appointed
by, and serve at the pleasure of, the Board of Directors. The number of
members on the Administrative Committee may be increased from time to
time, and new members may be appointed by the Board of Directors. Any
member of the Administrative Committee may resign at any time, and the
Board of Directors may remove any member of the Administrative
Committee at any time.
10.3 Committee Procedures. The Administrative Committee may select a
chairman and may select a secretary to keep its records or to assist
it with any other duties to be performed by the Administrative
Committee. A majority of the Administrative Committee in office may do
any act which the Plan authorizes or requires the Administrative
Committee to do, and the action of such majority expressed from time
to time by a vote at a meeting, or in writing without a meeting, shall
constitute the action of the Administrative Committee and shall have
the same effect for all purposes as if assented to by all members of
the Administrative Committee at the time in office. The members of the
Administrative Committee may, by a writing signed by a majority of
them, delegate to any one of them the authority to give certified
notice in writing of any action taken by the Administrative Committee.
10.4 Duties of the Committee. The Administrative Committee shall administer
the Plan and shall have the power and duty to take all action and to
make decisions necessary or proper to carry out the Plan. Without
limiting the generality of the foregoing, the Administrative Committee
shall have the following powers and duties:
(a) To require any person to furnish such information as it may
request for the purpose of the proper administration of the
Plan as a condition to receiving any benefit under the Plan;
(b) To make and enforce such rules and regulations and
prescribe the use of such forms as it shall deem necessary for
the efficient administration of the Plan;
(c) To interpret the Plan, and to resolve ambiguities,
inconsistencies and omissions, its interpretation and
resolution to be finally conclusive and binding on all parties
affected thereby; and
(d) To decide on questions concerning the Plan and the
eligibility of any Employee to participate in the Plan, in
accordance with the provisions of the Plan.
10.5 Expenses. All expenses incurred prior to termination of the Plan that
shall arise in connection with the administration of the Plan,
including but not limited to the compensation of any accountant,
counsel, specialist or other person who shall be employed by the
Administrative Committee in connection with the administration thereof,
shall be paid by the Company.
10.6 Committee Member Compensation. Unless otherwise agreed to by the
Company, the members of the Administrative Committee shall serve
without compensation for services as such, but all reasonable expenses
shall be paid by the Company. The Company may only agree to compensate
members of the Administrative Committee for services as such who are
not receiving full-time pay from the Company.
10.7 Indemnification. Except to the extent insured, the company shall
indemnify and save harmless any employee of the Company against any
cost or expense (including attorney's fees) or liability (including any
sum paid in settlement of a claim with the approval of the Company)
incurred by reason of the Employee's service as a fiduciary with
respect to the Plan, except in the case of willful misconduct.
10.8 Committee Records. The Committee may designate one of its members to
transmit all decisions of the Committee and to sign all necessary
notices and other reports or documents on behalf of the Committee. All
reports, notices or other documents bearing the signature of the
member so designated shall be deemed to bear the signatures of all the
members, and all parties dealing with the Committee are entitled to
rely on any such reports, notices or other documents as authentic and
representing the action of the Committee. The Committee shall maintain
such books of accounts, records and other data as may be necessary or
advisable in its judgment for the purpose of the proper administration
of the Plan.
ARTICLE XI
MISCELLANEOUS PROVISIONS
11.1 Exclusive Benefit. Plan assets shall be held for the exclusive purpose
of paying benefits to Participants and beneficiaries and defraying
reasonable expenses of administering the Plan; provided that, if any
contribution is made by the Company by mistake of fact, nothing in the
foregoing shall prohibit the return of such contribution within one
year of the payment of such contribution.
11.2 Plan Amendment of Termination. The Company reserves the right to
amend, modify, suspend or terminate the Plan at any time, provided
that no amendment shall have the effect of diverting any portion of
the Plan's assets to any purpose other than for the exclusive benefit
of the Participants and beneficiaries. In the event of the termination
or partial termination of the Plan or the complete discontinuance of
contributions to the Plan, the interest of Participants affected by
the termination and their beneficiaries under the Plan shall be
nonforfeitable. No amendment to the Plan shall decrease a
Participant's Accrued Benefit or eliminate an optional form of
distribution with respect to his Accrued Benefit as of the effective
date of the amendment. Upon the termination of the Plan, any
forfeiture which has not been reallocated as of such termination shall
be allocated to each Participant who is in the employment of the
Company as of the date of termination, in a manner consistent with the
manner in which Discretionary Contributions are allocated in
accordance with Section 4.1(f).
11.3 Merger, Consolidation or Transfer. This Plan shall not be merged or
consolidated with any other plan, not shall its assets or liabilities
be transferred to any other plan, unless immediately after such merger,
consolidation or transfer of assets, each Participant in the Plan
would, if the Plan were then to terminate, receive a benefit not less
than the benefit which he would have been entitled to receive
immediately before such merger, consolidation or transfer had the Plan
then terminated.
11.4 No Guarantee of Employment. Nothing in this Plan shall be construed to
give any Employee a legal right to be retained in the employ of the
Company.
11.5 No Alienation of Benefits. It is a condition of the Plan, and all
rights of each Participant shall be subject thereto, that no right or
interest of any Participant in the Plan or in his Account shall be
assignable, alienable, transferable or subject to any lien in whole or
in part, either directly or by operation of law or otherwise,
including, but not by way of limitation, execution, levy, garnishment,
attachment, pledge, bankruptcy or in any other manner, except a
transfer as a result of death or mental incompetency, and no right or
interest of any Participant in the Plan or in his Account shall be
liable for, or subject to, any obligation or liability of such
Participant. Notwithstanding the preceding paragraph, the Plan shall
honor orders that are determined by the committee to constitute
qualified domestic relation orders within the meaning of Section
414(p) of the Code. In order to be a qualified domestic relations
order, the Committee must determine that it is:
(a) a judgment, decree or order of a court (including approval of a
property settlement)
(b) made pursuant to state domestic relations law (including a community
property law)
(c) that provides child support, alimony payments, or marital property
rights to your spouse, former spouse, child or other dependent.
The Plan shall not honor a domestic relations order unless it
specifies:
(a) that it applies to the Plan,
(b) the name and last known mailing address of the affected
Participant, as well as the name and last known mailing
address of all alternative payees,
(c) the amount or percentage of the Participant's benefits
that are required to be paid to each alternate payee, or the
manner in which the amount or percentage is to be determined,
and
(d) the number of payments or the period to which the order
applies.
The Plan shall not honor a domestic relations order if it
purports to require the Plan to:
(a) provide increased benefits,
(b) provide any type or form of benefit, or any option, that
is not already provided for in the Plan, or
(c) pay to anyone any benefits that are already required to be
paid to someone else under a previous domestic relations
order.
When a domestic relations order comes to the Committee, the Committee
shall notify the affected Participant and the alternate payees that the
order has been received and described the following procedure for
deciding whether to honor the order. Next, the Committee shall
separately account for the benefits that, under the order, would be
paid to someone other than the Participant and withhold distribution
while deciding whether to honor the order. Next, the Committee shall
decide whether the order constitutes a qualified domestic relations
order. When the decision is made, the Committee shall notify the
affected Participant and the alternate payees. Such notification shall
be considered a decision on a claim, subject to the administrative
appeal procedures of Section 11.7.
If the Committee determines that the Plan will honor the order (or the
ultimate result of an appeal is that the Plan must honor the order),
the Committee shall proceed to make the payments required by the order
(or schedule them for future payment, if they are not due yet). If the
Committee decides that the Plan shall not honor the order (or the
ultimate result of an appeal is that the Plan must not honor the
order), the Committee will make payments as if there had been no order.
In the unlikely event that the Committee cannot decide whether the Plan
should honor the order within 18 months after the first payment should
have been made under the order, the Committee shall make payments as if
there had been no order until the decision is made, and then make
future payments (but no past payments) in accordance with the decision.
11.6 Gender and Number. Wherever used in this Plan, the masculine shall be
deemed to include the feminine and the singular shall be deemed to
include the plural, unless the context clearly indicates otherwise.
11.7 Administrative Committee. The Administrative Committee will operate and
administer the Plan, will determine all questions arising under or in
connection therewith, and may from time to time prescribe and amend
regulations for such administration.
The Committee shall have and shall exercise complete discretionary
authority to construe, interpret and apply all of the terms of the
Plan, including all matters relating to eligibility for benefits,
amount, time or form of benefits, and any disputed or allegedly
doubtful terms. In exercising such discretion, the committee shall give
controlling weight to the intent of the sponsor of the Plan. All
decisions of the Committee in the exercise of its authority under the
Plan shall be final and binding on the Plan, the Plan Sponsor and all
participants and beneficiaries.
The Committee will cause the records of the Plan to be kept on a basis
that accounts separately for Participant Salary Deferral Contributions
and Employer Contributions. Whenever directions, designations,
applications, requests, or other notices are to be given by a
Participant under the Plan, they shall be on forms prescribed by the
Committee and shall be filed in such manner as shall be specified by
the Committee on such forms. The Committee shall make all
determinations as to the right of any person to a benefit. If any claim
for benefits is wholly or partially denied by the Committee, written
notification shall be sent to the claimant no later than 90 days,
excluding extensions for special circumstances, after the initial claim
was filed. If such an extension is required, the claimant shall be sent
written notice of the extension prior to the termination of the initial
90-day period. In no case shall such an extension exceed a period of
180 days after the initial claim was filed. The notification of denial
shall provide the following information to the claimant:
(a) The specific reason or reasons for the denial, with
specific references to the pertinent Plan provisions on which
the denial is based;
(b) A request for any additional material or information
necessary for the claimant to correct the claim and an
explanation of why such material or information is needed;
(c) Appropriate information regarding the procedure to be
followed if the claimant wishes to appeal his claim denial.
Such information should include, but is not limited to:
(i) A statement informing the claimant that
a failure to perfect his claim within 60 days after
he receives notification of denial shall make the
Committee's denial decision conclusive.
(ii) A statement informing the claimant that
he or his personal representative may, upon written
request, require the Committee to furnish all
pertinent Plan information to the claimant.
If such appeal request is filed on a timely basis,
the Committee shall review it no later than 60 days after
receipt unless special circumstances require an extension of
time for processing. If such an extension is required, the
claimant shall be sent written notice of the extension prior
to the termination of the 60-day period. In no case, however,
shall the Committee's decision on such appeal request be
delivered later than 120 days following receipt of the appeal
request. The Committee's decision shall be delivered in
writing and shall include the specific reasons for the
decision and specific references to the Plan provisions which
are applicable. The determination of the Committee to any
disputed question shall be conclusive as to all persons
affected thereby.
11.8 Plan Construction. This Plan shall be construed, whenever possible, to
be in conformity with the requirements of the Code and the Employee
Retirement Income Security Act of 1974 as amended. To the extent not in
conflict with the preceding sentence, the construction and
administration of the Plan shall be governed by, and its validity
determined under, the laws of the Commonwealth of Pennsylvania.
ARTICLE XII
PROVISIONS RELATING TO TOP-HEAVY PLANS
12.1 Definitions. With respect to any Plan Year in which this Plan is a
Top-Heavy Plan (as hereinafter defined), the following additional
definitions shall apply:
(a) "Affiliated Company" means any entity which with the
Company forms (a) a controlled group of corporations within
the meaning of Section 414(b) of the Code, (2) a group of
trades or businesses under common control within the meaning
of Section 414(c) of the Code, or (3) an affiliated service
group within the meaning of Section 414(m) of the Code.
(b) "Aggregation Group" means the Permissive Aggregation Group
if there is one in existence, and shall otherwise mean the
Mandatory Aggregation group, each as hereinafter defined.
(c) "Determination Date" means, as to any Plan Year, the last
day of the preceding Plan Year.
(d) "Key Employee" means a person employed by the Company or
any Affiliated Company who, during the Plan Year or during any
of the preceding four Plan Years, was any of the following:
(1) An officer of the Company or an
Affiliated Company having an annual compensation in
excess of 50% of the dollar limitation under Section
415(b)(1)(A) of the Code. An individual shall be
considered an officer only if her (A) is in the
regular and continuous employ of the Company or an
Affiliated Company, (B) has been designated as an
officer pursuant to election or appointment by the
Board or other person or governing body having
authority to elect or appoint officers of the Company
or an Affiliated Company, and (c) is an
administrative executive.
The number of persons to be
considered officers in any Plan Year and the identity
of the persons to be so considered shall be
determined pursuant to the provisions of Section
416(i) of the Code and the regulations published
thereunder.
(2) One of the ten employees of the Company
and the Affiliated Companies owning (or considered as
owning under the attribution rules set forth at
Section 318 of the Code and the regulations
thereunder) the largest interest in the Company and
all Affiliated Companies (aggregated) and having an
annual compensation in excess of the dollar
limitation under Section 415(c)(1)(A) of the Code.
(3) A person who is both an employee and the
owner of a greater than 5% capital or profits
interests in the Company or in any Affiliated
Company, and any person who owns (or who, under
Section 318 of the Code, is considered as owning)
more than 5% of the outstanding stock of any entity
constituting the Company or of an Affiliated Company,
or of stock possessing more than 5% of the total
combined voting power of all stock of such entity or
Affiliated Company.
(4) A person who is both an employee whose
annual compensation (as determined by applying the
definition of compensation set forth in Section
415(c)(3) of the Code) from the Company and all
Affiliated Companies exceeds $150,000 and who is
greater than 1% owner of the Company, with ownership
determined pursuant to paragraph (3) of this Section
12.1(d) by substituting "1%" for "5%" at each place
where "5%" is set forth therein.
The beneficiary of any deceased Participant who was a
Key Employee shall be considered a Key Employee for the same
period as the deceased Participant would have been so
considered.
(e) "Key Employee Ratio" means the ratio for any Plan Year,
calculated as of the Determination Date with respect to such
Plan Year, determined by dividing the amount described in
paragraph (1) of this Section 12.1(e) by the amount described
in paragraph (2) of this Section 12.1(e), after deducting from
both such amounts the amount described in paragraph (3) of the
Section 12.1(e).
(1) The amount described in this paragraph
(1) is the sum of (A) the aggregate of the present
value of all accrued benefits of Key Employees under
all qualified defined benefit plans included in the
Aggregation Group, (B) the aggregate of the balances
in all of the accounts standing to the credit of Key
Employees under all qualified defined contribution
plans included in the Aggregation Group, and (C) the
aggregate amount distributed from all plans in such
Aggregation Group to or on behalf of any Key Employee
during the period of five Plan Years ending on the
Determination Date.
(2) The amount described in this paragraph
(2) is the sum of (A) the aggregate of the present
value of all accrued benefits of all participants
under all qualified defined benefit plans included in
the Aggregation Group, (B) the aggregate of the
balances in all of the accounts standing to the
credit of all participants under all qualified
defined contribution plans included in the
Aggregation Group, and (C) the aggregate amount
distributed from all plans in such Aggregation Group
to or on behalf of any participant during the period
of five Plan Years ending on the Determination Date.
(3) The amount described in this paragraph
(3) is the sum of (A) all rollover deposits (or
similar transfers) to the Plan initiated by an
Employee and made after December 31, 1983, and (B)
any amount that is included in subparagraph (2)
hereof for, on behalf of, or on account of, a person
who is a Non-Key Employee as to the Plan Year of
reference but who was a Key Employee as to any
earlier Plan Year.
(f) "Mandatory Aggregation Group" means the group of qualified
plans (including any terminated plans) sponsored by the
Company or by an Affiliated Company formed by including in
such group (1) all such plans in which a Key Employee is a
participant, and (2) all such plans which enable any plan
described in clause (1) to meet the requirements of either
Section 401(a)(4) of the Code or Section 410 of the Code.
(g) "Non-Key Employee" shall mean any person who is employed
by the Company or an Affiliated Company, but who is not a Key
Employee as to that Plan Year.
(h) "Permissive Aggregation Group" means the group of
qualified plans (including any terminated plans) sponsored by
the Company or by an Affiliated Company formed by including in
such group (1) all plans in the Mandatory Aggregation Group,
and (2) such other qualified plans sponsored by the Company or
an Affiliated Company as the Company elects to include in such
group, as long as the group, including those plans electively
included, continues to meet the requirements of Sections
401(a)(4) and 410 of the Code.
(i) "Super Top-Heavy Plans" means this Plan for any Plan Year
in which this Plan would be deemed to be a "Top-Heavy Plan"
pursuant to Section 12.2 of this Article XII if "90%" were
substituted for "60%" at each place where "60%" appears
therein.
(j) "Top-Heavy Plan" means this Plan for any Plan Year in
which this Plan is determined to be a "Top-Heavy Plan"
pursuant to the provisions of Section 12.2 of this Article
XII.
12.2 Determination of Top-Heavy Status. This Plan shall be deemed to be
"top-heavy" as to any Plan Year if, as of the Determination Date with
respect to such Plan Year, any of the following conditions are met:
(a) The Plan is not part of an Aggregation Group, and the Key
Employee Ratio under the Plan exceeds 60%;
(b) The Plan is part of an Aggregation Group, there being no
Permissive Aggregation Group of which the Plan is a part, and
the Key Employee Ratio of the Mandatory Aggregation Group of
which the Plan is a part exceeds 60%; or
(c) The Plan is part of an Aggregation Group, there is a
Permissive Aggregation Group of which the Plan is a part, and
the Key Employee Ratio of the Permissive Aggregation Group of
which the Plan is a part exceeds 60%.
12.3 Right to Participate in Allocation of Company's Contributions.
(a) General Rule. Notwithstanding any provision of this Plan
to the contrary, any person who was eligible to be a
Participant at any time during a Plan Year in which this Plan
was a Top-Heavy Plan shall share in the allocation provided
for in Section 4.1 of Article IV of this Plan for such Plan
Year if he or she remained in the employ of the Company or an
Affiliated Company through the end of the Plan Year with
respect to which such allocation applies.
(b) Exceptions to the General Rule. The provisions of Section
12.3(a) of the Article XII shall not apply to any Participant
for a Plan Year if, with respect to that Plan Year:
(1) Such Participant was an active
participant in a qualified defined benefit pension
plan sponsored by the Company or by an Affiliated
Company under which plan the Participant's accrued
benefit is not less than the minimum accrued pension
benefit that would be required under Section
416(c)(1) of the Code, treating such defined benefit
pension plan as a Top-Heavy Plan and treating all
such defined benefit pension plans as constitute an
Aggregation Group as a single plan; or
(2) Such Participant was an active
participant in a qualified defined contribution plan
sponsored by the Company or an Affiliated Company
under which plan the amount of the employer
contribution allocable to the account of the
Participant for the accrual computation period of
such plan ending with or within the Plan Year,
exclusive of amounts by which the Participant's
compensation was reduced pursuant to a salary
reduction agreement or similar arrangement, is not
less than the contribution allocation that would be
required under Section 416(c)(2) of the Code under
this Plan.
12.4 Minimum Company Contribution Allocation. The allocation made under
Section 4.1 of Article IV of this Plan to the Participant Account of
each Participant who is a Non-Key Employee for any Plan Year, including
a Plan Year in which this Plan is a Top-Heavy Plan or a Super Top-Heavy
Plan, shall be not less than the lesser of:
(a) 4% of the "compensation" (as defined in Section 415
of the Code) of each such Participant for such Plan Year; or
(b) The percentage of Compensation so allocated under Section
4.1 of Article IV to the account of the Key Employee for whom
such percentage is the highest for such Plan Year.
If any person who is a Participant in the Plan is a participant under
any top-heavy defined benefit pension plan qualified under Section
401(a) of the Code sponsored by the Company or by an Affiliated Company
the minimum benefit shall be provided under the defined benefit plan.
For the purposes of determining whether or not the provisions of this
Section 12.4 have been satisfied (1) contributions or benefits under
Chapter 2 of the Code (relating to tax on self-employment income),
Chapter 21 of the Code (relating to Federal Insurance Contributions
Act), Title II of the Social Security Act, or any other federal or
state law are disregarded, and (2) all defined contribution plans in
the Aggregation Group shall be treated as a single plan. For the
purposes of determining whether or not the requirements of this Section
12.4 have been satisfied, contributions allocable to the account of the
Participant under any other qualified defined contribution plan that is
part of the Aggregation Group shall be deemed to be contributions made
under this Plan, and, to the extent thereof, no duplication of such
contributions shall be required hereunder solely by reason of this
Section 12.4. This Section 12.4 shall not apply in any Plan Year in
which the Plan is part of an Aggregation Group containing a defined
benefit pension plan (or a combination of such defined benefit pension
plans) if the Plan enables a defined benefit pension plan required to
be included in such Aggregation Group to satisfy the requirement of
either Section 401(a)(4) or Section 410 of the Code.
12.5 Adjustments to Annual Additions and Combined Plans Limitations.
Notwithstanding any provision of the Code Section 415(e) to the
contrary, in respect to any Plan Year in which this Plan is a Super
Top-Heavy Plan, "1.0" shall be substituted for "1.25" in the
definitions of "defined benefit plan fraction" and "defined
contribution plan fraction".
12.6 Adjustments to Vesting Schedule. If this Plan is a Top-Heavy Plan with
respect to any Plan Year, the schedule set forth in this Section 12.6
shall be substituted for the applicable schedule in Section 7.2,
effective as of the first day of the first Plan Year in which this
Plan is a Top-Heavy Plan; provided, however, that the vesting interest
of each person who was a Participant as of the effective date of such
substitution shall in no event be lower at any time than his or her
vested interest would have been at such time if such vested interest
were determined pursuant to the vesting schedule as the same existed
immediately prior to such substitution.
The substitute vesting schedule referred to in this Section 12.6 is as
follows:
Period of Service Percentage of Vesting
less than 2 years 0%
2 years but less than 3 years 20%
3 years but less than 4 years 40%
4 years but less than 5 years 60%
5 years or more 100%
DEPARTMENT OF THE TREASURY
INTERNAL REVENUE SERVICE
DISTRICT DIRECTOR
31 HOPKINS PLAZA
BALTIMORE, MD 212010000
L.B. FOSTER COMPANY
415 HOLIDAY DRIVE
PITTSBURGH. PA 15220-0000 Employer Identification Number:
25-1324733
File Folder Number:
521004590
Person to Contact:
GLORIA E. CIERI
Contact Telephone Number:
(410) 962-2330
Plan Name: L. B. FOSTER COMPANY
VOLUNTARY INVESTMENT PLAN
Plan Number: 201
Dear Applicant:
We have made a favorable determination on your plan, identified above,
based on the information supplied. Please keep this letter in your permanent
records.
Continued qualification of the plan under its present form will depend
on its effect in operation. (See section 1.401-1(b)(3) of the Income Tax
Regulations.) We will review the status of the plan in operation periodically.
The enclosed document explains the significance of this favorable
determination letter, points out some features that may affect the qualified
status of your employee retirement plan, and provides information on the
reporting requirements for your plan. It also describes some events that
automatically nullify it. It is very important that you read the publication.
This letter relates only to the status of your plan under the Internal
Revenue Code. It is not a determination regarding the effect of other federal
or local statutes.
This determination is subject to your adoption of the proposed
amendments submitted in your letter dated August 23, 1995. The proposed
amendments should be adopted on or before the date prescribed by the
regulations under Code section 401(b).
This determination letter is applicable for the amendment(s) adopted on
February 28. 1995.
This plan has been mandatorily disaggregated, permissively aggregated,
or restructured to satisfy the nondiscrimination requirements.
This plan satisfies the minimum coverage requirements on the basis of
the average benefit test in section 410(b)(2) of the Code.
This letter is issued under Rev. Proc. 93-39 and considers the
amendments required by the Tax Reform Act of 1986 except as otherwise specified
in this letter.
This letter may not be relied upon with respect to whether the plan
satisfies the qualification requirements as amended by the Uruguay Round
Agreements Act, Pub. L. 103465.
If you have questions concerning this matter, please contact the person
whose name and telephone number are shown above.
Sincerely yours.
/s/ Paul M. Harrington
-----------------------
District Director
Enclosure(s)
Publication 794
L.B. Foster Company
RETIREMENT SAVINGS PLAN
for
Non-Union Hourly Employees
Effective January 1, 1994
ESTABLISHMENT AND PURPOSE
WHEREAS, as of December 1, 1986, the L. B. Foster Company (the "Employer")
established the Retirement Savings Plan for Hourly Employees of Niles, Ohio.
WHEREAS, the Plan was amended effective April 1, 1990 to cover non-union
hourly employees at other locations and to change its name to that of the "L.B.
Foster Company Retirement Savings Plan for Non-Union Hourly Employees" (the
"Plan").
WHEREAS, the purpose of the Plan is to encourage savings by employees and
to provide them with security for retirement;
Now, therefore, the Employer hereby adopts this amended and restated Plan
effective January 1, 1994 as set forth herein. However, it is the intent of the
Employer that any provisions of the Plan pertaining to TRA 86 apply to this Plan
as in effect from January 1, 1989 to December 31, 1993.
The Plan, as amended herein, shall become effective January 1, 1994. The rights
to benefits of any employee whose employment terminated prior to January 1, 1994
shall be determined solely by the provisions of the employee benefit plan in
which he was covered, if any, as in effect at the time of such termination of
employment, unless specifically otherwise provided herein.
ARTICLE I
DEFINITIONS
1.1 Accrued Benefit means, with respect to any Participant at any time,
the then vested amount of his Participant Account.
1.2 Accumulated Profits means net income or profits of the Company for
prior years as determined in the same manner as Current Profits.
1.3 Actual Contribution Percentage means, for any Participant or group of
Participants, the average of the ratios (calculated separately for
each Participant in the group) of (a) Voluntary Employee Contributions
made to a Participant Account for the Plan Year, to (b) the
Participant's compensation for the Plan Year. For purposes of
determining the Actual Contribution Percentage, "compensation" means
the Participant's earnings as reported on Form W-2 plus any amounts
deferred under a plan qualifying under Code Section 125 or 401(k),
minus any amounts paid as severance payments, or amounts earned prior
to the participant becoming an Eligible Employee.
1.4 Actual Deferral Percentage means, for any Participant or group of
Participants, the average of the ratios (calculated separately for
each Participant in the group) of (a) Salary Deferral Contributions
made on behalf of the Participant for the Plan Year, to (b) the
Participant's compensation for the Plan Year. For purposes of
determining the Actual Deferral Percentage, "compensation" means the
Participant's earnings as reported on Form W-2 plus any amounts
deferred under a plan qualifying under Code Section 125 or 401(k),
minus any amounts paid as severance payments, or amounts earned prior
to the participant becoming an Eligible Employee.
1.5 Administrative Committee or Committee means the L. B. Foster Company
Employee Benefit Policy and Review Committee appointed by the Board of
Directors for the purposes of administering this Plan in accordance
with the provisions of Section 10.2 of Article X.
1.6 Affiliated Company means any subsidiary or affiliate of the Company,
whether or not such entities have adopted the Plan, and any other
entity which is a member of a Controlled Group.
1.7 Board of Directors means the Board of Directors of the L. B. Foster
Company.
1.8 Break in Service means any 12-consecutive-month period during which an
Employee completes fewer than 500 Hours of Service. The relevant
periods for eligibility and vesting purposes shall be determined in
the same manner as is used for determining Years of Service.
Solely for purpose of determining whether a Break in Service has occurred,
a Participant who is absent from work for maternity or paternity
reasons shall receive credit for the Hours of
Service which would otherwise have been credited to such Participant
but for such absence, or in any case in which such Hours cannot be
determined, eight Hours of Service per day of such absence. For
purposes of this Paragraph, an absence from work for maternity or
paternity reasons means an absence (1) by reason of the pregnancy of
the Participant, (2) by reason of a birth of a child of the
Participant, (3) by reason of the placement of a child with the
Participant in connection with the adoption of such child by such
Participant, or (4) for purposes of caring for such child for a period
beginning immediately following such birth or placement. The Hours of
Service credited under this paragraph shall be credited (1) in the Plan
Year in which the absence begins if the crediting is necessary to
prevent a Break in Service in that period, or (2) in all other cases,
in the following Plan Year.
1.9 Code means the Internal Revenue Code of 1986 as amended from time to
time.
1.10 Company means the L. B. Foster Company, a corporation organized and
existing under the laws of the Commonwealth of Pennsylvania, as well
as any Affiliated Company which the Board of Directors has designated
as eligible to adopt the Plan, which has adopted this Plan and which
has agreed to be bound by the terms of the Plan and Trust Agreement;
provided, however, that an Affiliated Company shall become a Company
for purposes of the Plan upon, but not before, the date that such
Affiliated Company agrees to be bound by the terms of the Plan and
Trust, and employees of such Affiliated Company shall become Employees
for all purposes under the Plan upon, but not before, the date of such
agreement.
1.11 Company Contribution means the contribution the Company shall make to
Participant Accounts as provided in accordance with Section 4.1.
1.12 Company Contribution Portion means, as of any Valuation Date, the then
amount of the Company Contributions allocated to a Participant Account,
adjusted to reflect all credits and debits attributable to such
contributions which are made to such Participant pursuant to Section
5.3.
1.13 Compensation means the earnings paid by the Company to the Employee
during the Plan Year in the form of base salary, overtime payments,
vacation pay, bonuses or cash incentive pay, commissions, and any
elective deferrals under Section 125 or 401(k) of the Code, but
excluding all other payments.
In addition to other applicable limitations set forth in the plan, and
notwithstanding any other provision of the plan to the contrary, for
plan years beginning on or after January 1, 1994, the annual
compensation of each employee taken into account under the plan shall
not exceed the OBRA '93 annual compensation limit. The OBRA '93 annual
compensation limit is $150,000, (indexed to $160,000 in 1997) as
adjusted by the Commissioner for increases in the cost of living in
accordance with section 401(a)(17)(B) of the Internal Revenue Code. The
cost-of-living adjustment in effect for a calendar year applies to any
period, not exceeding 12 months, over which compensation is determined
(determination period)
beginning in such calendar year. If a determination period consists of
fewer than 12 months, the OBRA '93 annual compensation limit will be
multiplied by a fraction, the numerator of which is the number of
months in the determination period, and denominator of which is 12.
For plan years beginning on or after January 1, 1994, any reference in
this plan to the limitation under section 401(a)(17) of the Code shall
mean OBRA '93 annual compensation limit set forth in this provision. If
compensation for any prior determination period is taken into account
in determining an employee's benefits accruing in the current plan
year, the compensation for that prior determination period is subject
to the OBRA '93 annual compensation limit in effect for that prior
determination period. For this purpose, for determination periods
beginning before the first day of the first plan year beginning on or
after January 1, 1994, the OBRA '93 annual compensation limit is
$150,000 (indexed to $160,000 in 1997).
However, an Employee's compensation during a period of service in the
Uniformed Services shall be computed at the rate of the employee's
base monthly salary at the time the employee ceased active employment.
1.14 Controlled Group means the group of companies who, along with the
Company, is a member of a controlled group of corporations within the
meaning of Section 1563(a) of the Code, determined without regard to
Sections 1563(a)(4) and (e)(3)(C) of the Code, or a member with the
Company of a group of trades or businesses (whether or not
incorporated) under common control as determined by regulations issued
by the Secretary of the Treasury under Section 414(c) of the Code.
1.15 Current Profits means the amount of net income or profits of a Company
for the current Plan Year as determined by the Company either on an
estimated or final basis in accordance with sound accounting practices,
without deduction for taxes based upon income, or for contributions
made by the Company under this Plan. Such determination and Company
Contribution shall not be open to question by any Participant, either
before or after the Company Contribution has been made.
1.16 Disability means a Participant's incapacity to perform the duties of
his occupation or employment because of a medically determinable
physical or mental impairment which can be expected to be total and
permanent. Such determination of Disability shall be made by the
Administrative Committee with the advice of competent medical
authority.
1.17 Early Retirement Date means at the election of the Participant, the
first day of the month coincident with or following the Participant's
termination of employment with the Company, provided that the
Participant had attained age 55 and completed five Years of Service
prior to termination.
1.18 Effective Date means January 1, 1994.
1.19 Eligible Employee means a non-union hourly employee of the Company
employed at a location identified in Exhibit A, attached hereto, who is
not a leased employee within the meaning of Section 414(n)(2) and who
has completed one Year of Service and has attained his 21st birthday.
1.20 Employee means any individual in the employment of the Company or an
Affiliated Company which is part of the Controlled Group including
both leased employees within the meaning of Section 414(n)(2) of the
Code and any Employee who is also an officer or director of the
Company; provided, however, that it shall not include any person where
employment is governed by the terms of a collective bargaining
agreement under which retirement benefits were the subject of good
faith bargaining between the Company and Employee representatives,
unless such agreement expressly provides for the coverage of such
person in this Plan. Notwithstanding the foregoing, if leased
employees constitute less than 20% of the Company's non-highly
compensated work force within the meaning of Section 414(n)(5)(C)(ii)
of the Code, the term "Employee" shall not include those leased
employees covered by a plan described in Section 414(n)(5) of the Code
unless otherwise provided for by the terms of the Plan.
1.21 Fund or Investment Fund means the trust fund held by the Trustee in
accordance with the Trust Agreement.
1.22 Highly Compensated Employee means an individual who performs service
during the determination year and is described in one or more of the
following groups:
(a) An employee who is a 5% owner, as defined in section 416 (i) (1)
(A) (iii), at any time during the
determination year or the look-back year.
(b) An employee who receives compensation in excess of $80,000
(indexed in accordance with section 415 (d) during the
look-back year.)
For purposes of determining Highly Compensated Employees, the following
applies:
(a) The determination year is the plan year for which the
determination of who is highly compensated is being made.
(b) The look-back year is the 12-month period immediately preceding the
determination year.
(c) Compensation is compensation within the meaning of Code Section
415 (c) (3) including elective or salary reduction contributions
to a cafeteria plan, cash or deferred arrangement or tax-sheltered
annuity.
(d) Employers aggregated under Section 414 (b), (c), (a) or (o) of the
Code are treated as a single employer.
1.23 Hour of Service means:
(a) Each hour for which an Employee is paid, or entitled to payment,
for the performance of duties for the Company or any Affiliated
Company which is part of the Controlled Group during the
applicable computation period.
(b) Each hour for which back pay, irrespective of mitigation of
damages, is awarded or agreed to by the Company or any Affiliated
Company which is part of the Controlled Group; provided, however,
that the same hours shall not be credited more than once, and such
hours shall be credited to the Employee for the computation period
to which the award or agreement relates rather than the period in
which it is awarded, agreed upon or paid.
(c) Each hour for which an Employee is paid, or entitled to payment,
by the Company or an Affiliated Company which is part of the
Controlled Group on account of a period of time during which no
duties are performed due to vacation, holiday, illness, incapacity
(including Disability, other than permanent Disability), layoff,
jury duty, military duty or leave of absence. In applying the
preceding sentence:
(1) No more than 501 Hours of Service are required to be
credited to an Employee on account of a single continuous
period during which the Employee performs no duties
(whether or not such period occurs within a single
computation period);
(2) An Hour of Service need not be credited if payment is
made or due under a plan maintained solely for the
purpose of complying with applicable worker's
compensation, unemployment compensation or disability
insurance laws; and
(3) Hours of Service are not required to be credited for a
payment which solely reimburses an Employee for medical
or medically related expenses incurred by an Employee.
(d) Each hour for periods of employment with any predecessor if the
Company maintains a plan of such a predecessor or, if such a plan
is not maintained, to the extent required under regulations under
Section 414(a)(2) of the Code. Notwithstanding the above, the
Board of Directors may amend the Plan to grant additional credit
for periods of employment with a predecessor employer or a
corporation, substantially all of the assets of which have been
acquired by the Company, provided that in amending the Plan to
grant such credit, the Board of Directors acts in a uniform and
nondiscriminatory manner with respect to all Employees similarly
situated.
(e) In addition to the Hours of Service credited above, an Employee
shall be credited with Hours of Service for any noncompensated
absence which is authorized by a Company or any Affiliated
Company which is part of the Controlled Group, in accordance with
its uniform leave policy, provided the Employee returns to active
employment following the termination of the period of authorized
absence. For this purpose, periods of absence to enter active
service with the Armed Forces of the United States shall be
counted in computing Hours of Service, if the Employee returns to
work for the Company or an Affiliated Company within the period
following his discharge or release to inactive duty from such
service during which his reemployment rights are guaranteed by
law.
(f) An Employee shall be credited with 45 Hours of Service for each
week during which he is entitled to credit for at least one Hour
of Service; provided, however, that if the Employee demonstrates
to the satisfaction of the Committee that his actual number of
Hours of Service in any week is greater than 45, he shall be
credited with such actual number of Hours of Service.
(g) For purposes of eligibility to participate in the Plan (Section
1.19) and vesting (Sections 7.2 and 12.6), hours meeting the
requirements of this Section but for the fact that the individual
was not an Employee during the period to which the hours would
have been credited (by reason of serving in a collective
bargaining unit) shall nevertheless be taken into account.
Furthermore, the basis upon which Hours of Service shall be
calculated and credited to computation period shall be determined
pursuant to Section 2530.200b-2(b) of the Department of Labor
Regulations.
1.24 Investment Manager means the person or entity appointed by the
Committee to invest assets in the Participant Accounts upon the
direction of the Participants.
1.25 Non-Highly Compensated Employee means an Employee of the Company who
has completed one Year of Service, has attained his 21st birthday and
who is not a Highly Compensated Employee.
1.26 Normal Retirement Age means age 65.
1.27 Normal Retirement Date means the first day of the month coinciding with
or next following the date on which a Participant attains his 65th
birthday.
1.28 Participant means an Eligible Employee who enters the plan in
accordance with Article II. Any such Eligible Employee shall remain a
Participant until all benefits due him have been distributed.
1.29 Participant Account or Account means, as of any Valuation Date, the sum
of the Salary Deferral Contribution Portion, the Voluntary Employee
Contribution Portion, any rollovers and the Company Contribution
Portion.
1.30 Plan means the L. B. Foster Company Retirement Savings Plan for
Non-Union Hourly Employees as herein set forth and as amended from time
to time.
1.31 Plan Year means the 12-consecutive-month period beginning with January
1 and ending with December 31.
1.32 Retirement means termination of employment with a pension (whether
immediate or deferred) under the provisions of a retirement plan of the
Company or an Affiliated Company, or election of an Early Retirement
Date or termination of employment upon or after attaining Normal
Retirement Age.
1.33 Salary Deferral Contribution means the amount that a Participant
designates as Salary Deferral Contributions in accordance with Section
3.1(a) of Article III.
1.34 Salary Deferral Contribution Portion means, as of any Valuation Date,
the then amounts of the Participant's total Salary Deferral
Contributions, adjusted to reflect all debits and credits attributable
to such contributions which are made to such Participant Account
pursuant to Section 5.3.
1.35 Spouse means the lawful Spouse of the Participant at the earlier of the
Participant's date of death or the date benefits commence to the
Participant under the Plan.
1.36 Trust Agreement means any agreement entered into between the Company
and any Trustee to carry out the purpose of the Plan.
1.37 Trustee means any corporation, individual or group of individuals
appointed by the Board of Directors to act as Trustee under a Trust
Agreement.
1.38 Trust Fund means the fund established pursuant to the Trust Agreement
to hold and invest assets accumulated under the Plan.
1.39 Valuation Date means a day no less frequent than once in each calendar
quarter and any other date as designated by the Administrative
Committee.
1.40 Voluntary Employee Contributions means the after-tax contributions made
by a Participant in accordance with the provisions of Section 3.1(b).
1.41 Voluntary Employee Contribution Portion means, as of any Valuation
Date, the then amounts of the Participant's Voluntary Employee
Contributions, adjusted to reflect all debits and credits attributable
to such contributions which are made to such Participant Account
pursuant to Section 5.3.
- -2731.42 Year of Service means each 12-consecutive-month period during which an
Employee completes at least 1,000 Hours of Service. For purposes of
eligibility to participate in the Plan, the relevant
12-consecutive-month period shall begin on an Employee's first day of
employment, or re-employment following a Break in Service, and each
anniversary thereof.
For purposes of determining an Employee's vested percentage, the
relevant 12-consecutive month period is the Plan Year. An Employee
shall not be entitled to any credit for partial Years of Service.
A Participant who incurs a Break in Service of five years or longer and
is re-employed shall have his Years of Service prior to re-employment
disregarded if:
(a) He did not have a vested interest in his Company Contribution as of
the day his Break in Service began; and
(b) The length of his Break in Service equals or exceeds his Years of
Service prior to the Break in Service.
An Employee who has had prior Years of Service disregarded will be
treated as a new Employee for all purposes of the Plan. In all other
cases, if a former Employee is re-employed by the Company, his prior
Years of Service will be aggregated with his Years of Service after the
Break in Service.
1.43 Uniformed Services means the Armed Forces, the Army National Guard and
the Air National Guard when engaged in active duty for training,
inactive duty training, or full-time National Guard duty, the
commissioned corps of the Public Health Service, and any other category
of persons designated by the President in time of war or emergency.
"Service in the uniformed services" means the
performance of duty on a voluntary or involuntary basis in a uniformed
service under competent authority and includes active duty, active duty
for training, initial active duty for training, inactive duty training,
full-time National Guard duty, and a period for which a person is
absent from a position of employment for the purpose of an examination
to determine the fitness of the person to perform any such duty. In no
event shall the total length of service credited for service in the
uniformed services exceed five (5) years.
ARTICLE II
PARTICIPATION
2.1 Participation.
(a) Initial Participation. An Eligible Employee automatically becomes
a Participant in the Plan on the first day of the month following
the month in which an Employee first becomes an Eligible Employee.
An Eligible Employee may elect to make Salary Deferral
Contributions and Voluntary Employee Contributions as of the first
day of the month following the first day on which such Employee
becomes an Eligible Employee, provided that the Employee
authorizes the change in a manner approved by the Administrative
Committee.
(b) Following a Break in Service. A Participant who incurs a Break in
Service shall become an Eligible Employee on the first day of the
month coincident with or next following his completion of one Hour
of Service subsequent to such Break in Service.
2.2 Participant Contributions. A Participant may elect to make Salary
Deferral Contributions and Voluntary Employee Contributions to
the Plan. Such Participant's Salary Deferral Contributions and
Voluntary Employee Contributions shall begin on the first day of
the month, provided that the Employee authorizes the change in a
manner approved by the Administrative Committee.
2.3 Provisions Relating to Leased Employees.
(a) Safe-Harbor. Notwithstanding any other provisions of the Plan, for
purposes of determining the number or identity of Highly
Compensated Employees or for purposes of the pension requirements
of Section 414(n)(3) of the Code, the Eligible Employees of the
Company shall include individuals defined as Employees in Section
1.20.
(b) Participation and Accrual. A leased employee within the meaning of
Section 414(n)(2) of the Code shall not become a Participant in,
and shall not accrue benefits under, the Plan based on service as
a leased employee.
ARTICLE III
PARTICIPANT CONTRIBUTIONS
3.1 Contributions.
(a) Salary Deferral Contributions. Each Participant may elect to
designate as his Salary Deferral Contribution each payroll period,
a rate of not less than 2% nor more than 10% of his Compensation,
in multiples of 1% for such payroll period. Salary Deferral
Contributions for any calendar year are limited to the amount
specified under Code Section 402(g)(5).
(b) Voluntary Employee Contributions. A Participant who is making a
minimum of 5% Salary Deferral Contributions may elect to
contribute Voluntary Employee Contributions, provided that the sum
of the Participant's Salary Deferral Contributions and Voluntary
Employee Contributions in any Plan Year shall not exceed 15% of
his Compensation. Voluntary Employee Contributions are made on an
after-tax basis.
3.2 Payroll Deductions. Participant contributions shall be made through
reductions in the amount otherwise payable in cash to the Participant
as authorized by the Participant.
3.3 Designation of the Amount of Contributions.
(a) Initiation of Contributions. An Eligible Employee may initiate
contributions to the Plan by following the procedures approved by
the Administrative Committee. The designated rate of contribution
shall be effective on the first day of the month following the
date the Employee authorizes the contributions in a manner
approved by the Administrative Committee.
(b) Change in Contributions. A Participant may change his rate of
contributions. Any changes in the rate of contributions shall
become effective on the first day of the month following the date
the Employee authorizes the change in a manner approved by the
Administrative Committee.
3.4 Suspension of Participant Contributions. A Participant may elect
to suspend his contributions. Such voluntary suspension shall
become effective on the first day of the month following the date
the Employee authorizes the suspension in a manner approved by
the Administrative Committee. If a Participant elects to suspend
his contributions in accordance with the provisions of this
Section 3.4, he shall not be eligible to resume his contributions
until the first day of the fourth month following the month in
which his suspension became effective. When the Participant
elects to resume his contributions, he shall do so in a manner
approved by the Administrative Committee. A Participant shall not
be permitted to make up suspended contributions. Participant
contributions shall be suspended automatically for any payroll
period in which the Participant is not in receipt of Compensation
and his contributions shall not resume until the first day of the
month following the month in which he receives Compensation.
However, in the case of a temporary layoff, contributions shall
resume immediately upon return to active employment.
A Participant who is absent from employment on account of an authorized
unpaid leave of absence or a military leave shall automatically have
Participant contributions suspended during such leave. Such suspension
shall become effective on the date such authorized leave begins and
shall remain effective for the entire period of such leave. Such a
Participant shall be eligible to resume contributions immediately upon
return to active employment. Upon reemployment, a Participant serving
in the Uniformed Services shall be permitted to make up contributions
for the period served based on their election in effect immediately
before the leave. The period of repayment is subject to good faith
negotiations between the Company and the Employee.
3.5 Reduction in Salary Deferral Contribution. For any Plan Year, the
Actual Deferral Percentage for Highly Compensated Employees may not exceed the
greater of Test I or Test II below:
Test I: 125% of the Actual Deferral Percentage for Non-Highly
Compensated Employees;
Test II: The lesser of (a) 200% of the Actual Deferral Percentage for
Non-Highly Compensated Employees; or (b) such Actual Deferral
Percentage for Non-Highly Compensated Employees plus two
percentage points.
The plan will take into account the actual deferral ratios of all
eligible employees for purposes of the actual deferral percentage (ADP)
test in Section 401(k). For this purpose, an eligible employee is any
employee who is directly or indirectly eligible to make a cash or
deferred election under the plan for all or a portion of a plan year
and includes: an employee who would be a plan participant but for the
failure to make required contributions; an employee whose eligibility
to make elective contributions has been suspended because of an
election (other than certain one-time elections) not to participate, a
distribution, or a loan; and, an employee who cannot defer because of
the Section 415 limits on annual additions. In the case of an eligible
employee who makes no elective contributions the deferral ratio that is
to be included in determining the ADP is zero.
An elective contribution will be taken into account under the actual
deferral percentage test of Section 401(k)(3)(A) of the Code for a plan
year only if it is allocated to the employee as of a date within that
plan year. For this purpose, an elective contribution is considered
allocated as of a date within a plan year if the allocation is not
contingent on participation or performance of services after such date
and the elective contribution is actually paid to the trust no later
than 12 months after the plan year to which the contribution relates.
For purposes of determining whether a plan satisfies the actual
deferral percentage test of Section 401(k), all elective contributions
that are made under two or more plans that are aggregated for purposes
of Section 401(a)(4) or 410(b) (other than Section 410(b)(2)(A)(ii))
are to be treated as made under a single plan and if two or more plans
are permissively aggregated for purposes of Section 401(k), the
aggregated plans must satisfy Sections 401(a)(4) and 410(b) as though
they were a single plan. In calculating the actual deferral percentage
for purposes of Section 401(k), the actual deferral ratio of a highly
compensated employee will be determined by treating all cash or
deferred arrangements under which the highly compensated employee is
eligible (other than those that may not be permissively aggregated) as
a single arrangement.
3.6 Prospective Reduction of Salary Deferral Contributions. The
Committee shall determine periodically whether the amount of
Salary Deferral Contributions elected by the Highly Compensated
Employees would exceed the permissible Actual Deferral Percentage
(taking into account Salary Deferral Contributions elected for
the month in question continues in effect for the remainder of
the Plan Year). If so, the amount of Salary Deferral
Contributions allowed to be made on behalf of Highly Compensated
Employees with respect to the remainder of the Plan Year shall be
reduced. The Highly Compensated Employees with respect to whom
such reduction shall be made and the amount of such reduction
shall be determined by reducing the maximum allowable Salary
Deferral Contribution under Section 3.1 from 10% of Compensation
to such percentage which will, when applied to all Highly
Compensated Employees who authorized such Salary Deferral
Contributions, result in the Actual Deferral Percentage set forth
in Section 3.5 not being exceeded. Once a reduction has been made
hereunder, it shall remain in effect for the duration of the Plan
Year unless the Committee determines that it is no longer
necessary in order for the Actual Deferral Percentage limitation
to be met.
3.7 Retrospective Reduction of Salary Deferral Contributions. In the
event that, notwithstanding Section 3.6 hereof, it is determined
by the Committee during any Plan Year or prior to the due date,
including extensions, for filing the Company's federal income tax
return for such Plan Year, that the limitations contained in
Section 3.5 have been exceeded for that Plan Year then the Salary
Deferral Contributions that have been made on behalf of the
Highly Compensated Employees shall be reduced in the manner
prescribed in Section 3.6 above and recharacterized as Voluntary
Employee Contributions. Any earnings accrued on the amount by
which a Participant's Salary Deferral Contributions are reduced
shall be treated as earnings attributable to the Participant's
Voluntary Employee contributions. Recharacterized excess
contributions will remain subject to the nonforfeitability
requirements and distribution limitations that apply to elective
contributions.
Failure to correct excess contributions by the close of the Plan Year
following the Plan Year for which they were made will cause the cash or
deferred arrangement to fail to satisfy the requirements of Section 401
(k) (3) for the Plan Year for which the excess contributions were made
and for all subsequent years they remain in the trust. The Employer
will be liable for a 10% excise tax on the amount of excess
contributions unless they are corrected within 2-1/2 months after the
close of the Plan Year for which they were made.
Recharacterized excess contributions will remain subject to the
nonforfeitability requirements and distribution limitations that apply
to elective contributions.
3.8 Remittance of Participant Contributions. Amounts deducted as
Participant contributions shall be remitted to the Trustee as soon as
practicable after the end of each month.
3.9 Rollover Contributions. A Participant may transfer to the Plan a
qualified total distribution, as defined in Section 402(a)(5)(E)(i) I
or II of the Code, provided that such distribution is from a plan which
meets the requirements of Section 401(a) of the Code ("Other Plan") and
that the following conditions are satisfied:
(a) The amount of the rollover must be in the form of cash or cash
equivalent;
(b) The rollover occurs on or before the 60th day following the
Employee's receipt of the distribution from the Other Plan; and
(c) The amount of the rollover does not exceed the maximum rollover
amount permitted under the provisions of Section 402(a)(5)(B) of
the Code, which limit shall amount to the fair market value of all
property received in such distribution reduced by Employee
contributions, as defined in Section 402(a)(5)(E)(ii) of the Code.
A Participant, who has previously transferred a distribution from
another plan into an individual retirement account ("IRA"), may roll
over the amount of such distribution, plus earnings thereon, from the
IRA to the Plan; provided that such distribution is transferred to the
Plan as a Rollover Contribution on or before the 60th day following
receipt thereof from the IRA, and such Rollover Contribution complies
with Section 408(d)(3) of the Code.
The Administrative Committee shall develop such procedures and may
require such information from a Participant desiring to make a Rollover
Contribution as it deems necessary or desirable to determine that the
proposed Rollover Contribution will meet the requirements of this
Section 3.9. Upon approval by the Administrative Committee, the amount
of the Rollover Contribution shall be deposited in the Plan and shall
be credited to the Participant's rollover account. The amount of the
Rollover Contribution credited to such Account shall be 100% vested in
the Participant and shall share in the appropriate investment earnings.
ARTICLE IV
COMPANY CONTRIBUTIONS
4.1 Company Contribution. The Company shall contribute to each
Participant's Account an amount equal to $.12 for each hour worked for
each Eligible Employee (excluding employees of Georgetown,
Massachusetts). Such Contribution shall continue for as long as the
Eligible Employee is receiving Compensation from the Company.
Eligible Employees of Georgetown, Massachusetts, shall have a company
matching contribution of $.50 for every $1.00 contributed by the
Eligible Employee, up to the first 5% of the Compensation of the
Eligible Employee. This matching contribution will only be made if the
Eligible Employee contributes to the Plan.
Upon reemployment of an Employee serving in the Uniformed Services, the
Employer will make the Company Contribution to the Plan on behalf of
the Employee, as if the Employee had continued active employment and
worked 40 hours per week.
4.2 Remittance and Investment of Company Contributions. The Company
Contribution as described under Section 4.1 shall be transmitted to the
Trustee as soon as practicable after the end of each calendar month.
4.3 Forfeitures of Company Contributions. Amounts forfeited by Participants
in accordance with Section 7.2 shall be applied to reduce future
Company Contributions under the Plan.
4.4 Limitations on Contributions. Contributions made by the Company on
behalf of any Participant shall be limited to the maximum amounts
permitted under the Code as follows:
(a) The annual addition to any Participant's Account, when added
to similar additions under other defined contribution plans
maintained by the Company and Affiliated Companies, shall not
exceed the lesser of $30,000 (or such other amount as
determined by the Secretary of the Treasury) or 25% of such
Participant's annual limitation compensation.
.
(b) Section 415(e) of the Code prescribes aggregate limitations
for those Employees who participate in both the Plan and a
defined benefit plan. If, for any Plan Year, the limitations
prescribed in Section 415(e) of the Code are exceeded, the
benefit payable under the pension plan shall be reduced to
meet the limitations.
(c) In the event that it is determined that the contributions made
on behalf of any Participant for any Plan Year are in excess
of the limitations set forth in this Section 4.4, such
contributions shall be reduced in the following order:
(1) Voluntary Employee Contributions;
(2) Salary Deferral Contributions;
to the extent necessary to bring such contributions within the
limitation set forth herein.
(d) Definitions. For purposes of this Section 4.4, the following
definitions shall apply:
(1) Annual additions shall mean the sum of Company
contributions, Salary Deferral Contributions and
Voluntary Employee Contributions.
(2) Compensation means the amount as determined under
Regulation Section 1.415-2. No more than $160,000 (as
of 1/1/97, indexed annually) of such Compensation
shall be taken into account for any Plan Year
hereunder, provided that such amount shall be
adjusted annually for increases in the cost of living
in accordance with Section 415(d) of the Code.
4.5 Company Contribution Limitation. For any Plan Year, the Actual
Contribution Percentage for the Highly Compensated Employees may not
exceed the greater of Test I or Test II below:
Test I: 125% of the Actual Contribution Percentage for all eligible
Non-Highly Compensated Employees;
Test II: The lesser of (a) 200% of the Actual Contribution
Percentage for all eligible Non-Highly Compensated
Employees; or (b) the Actual Contribution Percentage for
all eligible Non-Highly Compensated Employees plus two
percentage points.
For purposes of calculating the Actual Contribution Percentage the Plan
will take into account that actual contribution ratios of all eligible
employees .
For purposes of determining whether a plan satisfies the actual
contribution percentage test of Section 401(m), all employee and
matching contributions that are made under two or more plans that are
aggregated for purposes of Section 401(1)(4) and 410(b) (other than
Section 410(b)(2)(A)(ii) are treated as made under a single plan. If
two or more plans are permissively aggregated for purposes of Section
401(m), the aggregated plans must also satisfy Section 401(a)(4) and
410(b) as though they were a single plan.
The actual contribution ratio of a Highly Compensated employee will be
determined by treating all plans subject to Section 401(m) under which
the Highly Compensated employee is eligible (other than those that may
not be permissively aggregated) as a single plan.
4.6 Prospective Reduction of Contributions. In the event that it is
determined that the amount of Voluntary Employee Contributions made to
the Participant Accounts of the Highly Compensated Employees would
cause the Actual Contribution Percentage described in Section 4.5 to be
exceeded (taking into account the
contributions made during the prior months of the Plan Year and
assuming that the rate of contributions continues in effect for the
remainder of the Plan Year), then the amount of Voluntary Employee
Contributions allowed to be made by and on behalf of Highly Compensated
Employees with respect to such month shall be reduced. The Highly
Compensated Employees with respect to whom such reduction shall be made
and the amount of such reduction shall be determined by reducing the
maximum allowable Voluntary Employee Contributions to the extent that
the Actual Contribution Percentage set forth in Section 4.5 is not
being exceeded.
4.7 Retrospective Reductions of Contributions. In the event that,
notwith- standing Section 4.6 hereof, it is determined by the
Committee during any Plan Year or prior to the due date,
including extensions, for filing the Company's federal income tax
return for such Plan Year, that the Actual Contribution
Percentage, as initially determined, has been exceeded, then the
Voluntary Employee Contributions that have been made by and on
behalf of the Highly Compensated Employees shall be returned to
the Participant, along with the earnings associated with such
contributions. The amount to be returned shall be determined by
first reducing the Participant(s) in the group of Highly
Compensated Employees with the highest individual Actual
Contribution Percentage(s) to the next lower one percent, and
then repeating such reduction with respect to such Participant(s)
to the extent necessary to assure that the limitation will be
satisfied for the Plan Year.
The amount of excess aggregate contributions for a plan year shall be
determined only after first determining the excess contributions that
are treated as employee contributions due to recharacterization.
The distribution of excess aggregate contributions will include the
income allocable thereto. The income allocable to the excess aggregate
contributions includes income for the plan year for which the excess
aggregate contributions were made and income for the period between the
end of the plan year and the date of distribution. Failure to correct
excess aggregate contributions by the close of the plan year following
the plan year for which they were made will cause the plan to fail to
satisfy the requirements of Section 401(a)(4) for the plan year for
which the excess aggregate contributions were made and for all
subsequent years they remain uncorrected. Also, the employer will be
liable for a 10% excise tax on the amount of excess aggregate
contributions unless they are corrected within 2-1/2 months after the
close of the plan year for which they were made.
The distribution of excess aggregate contributions shall be made on the
basis of the respective portions of such amounts attributable to each
highly compensated employee.
4.8 Aggregate Limit on Actual Deferral Percentages. In the event that Test
II is used under both Sections 3.5 and 4.5, the aggregate limit may not
exceed the greater of (a) or (b):
(a) The sum of (1) and (2) as follows:
(1) 125% of the greater of (A) the Actual Deferral Percentage
in Section 3.5 of the group of Non-Highly Compensated
Employees eligible to make Salary Deferral Contributions
for the Plan Year, or (B) the Actual Contribution
Percentage of the group of Non-Highly Compensated
Employees eligible to receive Company Contributions in
the Plan Year; plus
(2) Two plus the lesser of (a)(1)(A) or (a)(1)(B) above. In
no event, however, shall this amount exceed 200% of the
lesser of (a)(1)(A) or (a)(2)(B).
(b) The sum of (1) and (2) below:
(1) 125% of the lesser of (A) the Actual Deferral Percentage
in Section 3.5 of the group of Non-Highly Compensated
Employees eligible to make Salary Deferral Contributions
for the Plan Year, or (B) the Actual Contribution
Percentage of the group of Non-Highly Compensated
Employees eligible to receive Company Contributions in
the Plan Year; plus
(2) Two plus the greater of (b)(1)(A) or (b)(1)(B) above. In no event,
however, shall this amount exceed 200% of the greater of (b)(1)(A) or
(b)(1)(B).
In the event that the aggregate limit described in this Section 4.8 is
exceeded at the end of the Plan Year, certain Participants in the group
of Highly Compensated Employees may have certain of their contributions
returned, along with the earnings associated with such contributions,
in accordance with the provisions of Section 4.7.
The distribution of such excess contributions, along with the earnings
associated with such contributions, will be made by the March 15
following the calendar year in which the excess contributions were
made.
4.9 Return of Contributions. In the event that a contribution is made to the
Plan:
(a) Under a mistake of fact; or
(b) Conditioned upon deduction of the contribution under Code Section
404 and such deduction is disallowed, the contribution shall be
returned to the Company within one year after the payment of the
contribution or the disallowance of the deduction (to the extent
disallowed), whichever is applicable, in such form as may be
prescribed by regulations issued by the Secretary of the Treasury.
19
Amendment #3 dated 1/1/97 replaces all prior
In the event that, notwithstanding Section 4.8 hereof, it is
determined by the Committee during any Plan Year or prior to the
due date, including extensions, for filing the Company's federal
income tax return for such Plan Year, that the Actual Contribution
Percentage, as initially determined, has been exceeded, then the
matching contributions and Voluntary Employee contributions that
have been made by and on behalf of the Highly Compensated
Employees shall be returned to the Participant, along with the
earnings associated with such contributions. The amount to be
returned shall be determined by first reducing the Participant(s)
in the group of Highly Compensated Employees with the highest
individual Actual Contribution Percentage(s) to the next lower one
percent, and then repeating such reduction with respect to such
Participant(s) to the extent necessary to assure that the
limitation will be satisfied for the Plan Year. Notwithstanding
anything in the above to the contrary, a Highly Compensated
Employee who is not yet vested in accordance with Section 7.1
shall forfeit the amount of matching contributions instead of
having such contributions paid to him.
4.10 Contributions Limited to Amount Deductible. Company Contributions,
including Salary Deferral Contributions shall not be made to the Plan
to the extent they would exceed the maximum amount deductible by the
Company under Code Section 404.
In the event that it is determined that the deductible limits would be
exceeded, contributions shall be reduced in such manner as the Company
shall prescribe.
ARTICLE V
PARTICIPANT ACCOUNTS
5.1 Participant Accounts. Each Participant Account shall separately account
for the value of:
(a) Salary Deferral Contributions;
(b) Voluntary Employee Contributions;
(c) Company Contributions; and
(d) Any rollover deposits.
Each such account shall reflect the income, losses, appreciation and
depreciation attributable to such items as are allocated to such
account. Separate investments are not required to be maintained for any
Participant Account.
5.2 Valuation of Assets. At each Valuation Date in which the Plan is in
operation, the Trustee and/or the Investment Company shall determine
the total fair market value of all assets then held in the Fund.
5.3 Investment of Contributions. Each Participant shall direct that
his Participant Account be invested in one or more of the
Investment funds held by the Trustee. The Employer may enter into
a written agreement with one or more Investment Manager(s),
pursuant to which such Investment Manager(s) may permit the
Participants to direct the investment of the Participants'
Accounts held in the Trust in one or more group or common trust
funds managed by the Investment Manager(s). Such funds may
include, but shall not be limited to (a) Growth and Income Fund,
(b) Pure Growth Fund (c) Equity Fund, (d) GIC Fund, (e) Bond
Fund, and (f) Money Market Fund.
The Employer may, from time to time, make available additional or
alternative investment funds, or replace or suspend any one of the
above funds.
In the absence of a designation by the Participant, contributions shall
be invested in the Money Market Fund.
The Investment Manager(s), at the Participant's request and within one
month after an Employee becomes a Participant, shall provide each
Participant with a complete description of the Funds.
No less frequently than once each calendar quarter, the investment
returns attributable to each investment fund are allocated to each
Account within the investment fund in the same proportion that such
Account balance for such month bears to the total Account balances for
such month. The Account balance shall be determined by debiting the
prior quarter's Account balance for any withdrawals, transfers out of
such Account and loans made from the Account
and crediting the prior quarter's Account balance with transfers to the
Account and loans repaid to the Account.
5.4 Change in Future Investment Elections. Any investment election given by
a Participant for investment of the contributions will continue in
effect until changed by the Participant. A Participant shall notify the
Administrative Committee or its designee of the change as prescribed by
the Committee.
5.5 Conversion of Past Investment Elections. A Participant may elect to
transfer all or a portion of the value of his Account invested in a
fund in accordance with uniform and nondiscriminatory rules prescribed
by the Committee or its designee effective as of the date the Trustee
makes such transfer.
5.6 Effect of Re-employment. Subject to the provisions of Article X, if a
Participant terminates his employment and begins to receive a
distribution under this Plan and, prior to the time his Participant
Account shall have been fully distributed to him, he is re-employed by
the Company, then, in such event, his right to further payments from
his Participant Account shall cease and such undistributed amount shall
be retained for his benefit until he thereafter terminates his
employment with the Company.
5.7 Statements of Participant Accounts. Not less frequently than once in
each Plan Year, each Participant shall receive a statement of his
account balance and his nonforfeitable right, if any, to his account
balance.
ARTICLE VI
WITHDRAWALS AND LOANS
6.1 Election and Form of Withdrawal. A Participant may apply for a hardship
withdrawal from his Account by authorizing the withdrawal in a manner
approved by the Administrative Committee. Such an election shall take
effect on the first day of a month following completion of required
procedures. The amount withdrawn shall be paid to the Participant in
the form of a single cash payment, and no amount withdrawn may be
repaid to the Plan. No more than one withdrawal may be made in any
12-month period and no withdrawal shall be less than $1,000.
6.2 Requirements for Hardship Withdrawal. The withdrawal must be for
an immediate and heavy financial need of the Participant for
which funds are not reasonably available from other resources of
the Participant. If approved by the Plan Administrator, such
withdrawal shall be equal to the lesser of (i) the amount
required to be distributed to meet the need created by the
hardship, or (ii) the Participant's Salary Deferral Contribution
Portion. The determination of the existence of financial hardship
and the amount required to be distributed to meet the need
created by the hardship must be made in a uniform and
nondiscriminatory manner. The circumstances which may warrant
approval of a Participant's application for a hardship withdrawal
are:
a) Medical expenses (to the extent not otherwise reimbursed under any
other medial care programs)
incurred by the Participant or his dependents;
(b) Purchase of a principal residence for the Employee;
(c) Tuition for post-secondary education, but only for the next quarter
or semester; and
(d) Prevention of eviction or mortgage foreclosure.
The conditions under which a Participant may be deemed to lack other
resources are as follows:
(a) The hardship withdrawal cannot exceed the amount needed;
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(b) The Participant must have obtained all distributions (except
hardship withdrawal) and all nontaxable loans available from all
of the Employer's plans;
(c) The Participant's contributions under all plans must be suspended
for twelve months after the hardship withdrawal; and
(d) The dollar limit on pre-tax contributions for the year after the
hardship withdrawal must be reduced by the amount of pre-tax
contributions made during the year in which the hardship occurred.
23
Amendment #5 dated 1/1/99 replaces all prior
0 If the Participant is married, spousal consent is required.
6.3 Source of Withdrawal Proceeds. The Fund from which a withdrawal is
made shall be determined by the Committee after consultation with the
Participant.
6.4 Restriction on Amount of Withdrawal if a Loan is Outstanding. In no
event will a withdrawal from the Plan be permitted in an amount
greater than the value of the Participant's vested interest,
determined as of the Valuation Date immediately preceding withdrawal,
less 200% of the then outstanding loan balance (including principal
and interest) of any loan granted to the Participant.
6.5 Amount of Loan. A Participant (including those on leave of absence,
long-term disability, or who are
currently employees on a salaried basis but who, prior to becoming
salaried employees, were Participants in the Plan) may obtain a loan
from his Account, excluding the portion of his Account attributable to
Company Contributions, in which he is not vested. The minimum amount
of any loan shall equal $1,000. The maximum amount of any loan, when
added to the outstanding principal balance of any other loan, shall in
no event exceed 50% of a Participant's vested Account balance up to a
maximum of $50,000 (reduced by the excess, if any, of the highest out-
standing loan balance during the preceding 12-month
period over the outstanding balance of loans from the Plan on the date
the loan was made).
6.6 Application for a Loan. A Participant may apply for a loan by
completing the procedures approved by the Administrative
Committee. Unless an exception to the normal processing is
requested by the Participant and is approved by the Committee,
loans are approved as of the first day of any calendar quarter
following procedures as approved by the Administrative Committee.
The amount borrowed by the Participant shall be paid to him as
soon as administratively possible after the first day of the
calendar quarter. The Spouse of a married Participant must
consent to the loan and to the possible reduction of benefits
pursuant to Section 6.9.
6.7 Promissory Note. As evidence of a loan, a Participant shall provide a
promissory note to the Trustee in a form prescribed by the Committee.
The rate of interest shall be the sum of the prime rate at a bank
specified by the Committee plus one-half percent. Such interest rate
shall remain fixed for the full term of the loan. Payments due under
the note shall be level amortization payments, payable no less
frequently than quarterly.
6.8 Source of Loan Proceeds. A loan to a Participant shall be made from the
Participant's Account, and such Account shall be reduced by the amount
of any unpaid loan. In the event that a Participant's Account is
invested in more than one investment fund, the investment fund(s) from
which the loan shall be made shall be determined by the Participant.
6.9 Security. As security for a loan, a Participant's promissory note shall
be secured by his Account in the Plan. A married Participant must
provide the Committee with the written consent of his Spouse in order
to secure the loan with his Account. If, before a loan is repaid, the
Participant's employment is terminated and he or his beneficiary
becomes entitled to a distribution from the Plan, the unpaid principal
balance of the loan shall be offset from the distribution otherwise
payable.
6.10 Administrative Charge. An administrative charge shall be deducted from
the Participant's Account for the initial processing of the loan and
also with respect to each Plan Year in which he has a loan balance
outstanding.
6.11 Repayment. A Participant's note ordinarily shall be repaid by
payroll deduction in such amounts as are determined by the
Committee. Each payment shall be credited to the Participant's
Account and shall be invested in accordance with the
Participant's investment designation in effect under Section 5.3
at the time the payment is so credited. A loan shall be required
to be repaid within 60 months from the date on which the loan
originally is made; provided, however, that the repayment period
for a loan that is used to acquire a dwelling unit which is to be
used as a principal residence of the Participant may be as long
as 360 months from the date on which the loan is originally made.
Loans may be repaid without penalty at any time. In addition to
regularly scheduled payments, partial payments made to reduce the
outstanding loan balance may be made once each calendar year.
6.12 Default. If a Participant shall fail to make any installment
payment or the annual administrative charge on a loan within 30
days after the due date of such payment, then the Committee will
accelerate repayment of the loan and demand immediate repayment
of the principal and interest due. If the Participant fails to
comply within 30 days, the Committee shall reduce the
Participant's vested Account balance, as permitted by law, in
order to recover the outstanding loan balance plus interest due.
At the time of disbursement of benefits, the balance, including
interest, will be deducted from the disbursement.
6.13 Loan Administration. The loan provisions under this Article VI
shall be administered by the Committee.
ARTICLE VII
VESTING AND TERMINATION OF EMPLOYMENT
7.1 Salary Deferral Contributions and Rollover Deposits. A
Participant will at all times be 100% vested in his Participant
Account attributable to Salary Deferral Contributions, Voluntary
Employee Contributions and rollover deposits.
7.2 Company Contributions. A Participant shall vest in his account
balance attributable to Company Contributions in accordance with
the following schedule:
Years of Service Vesting Percentage
-------------------- ------------------
fewer than 5 years 0%
5 years or more 100%
Any amounts not vested upon termination will be forfeited at the end of
the Plan Year following such Participant's termination unless the
Participant returns to employment prior to incurring a five-year long
Break in Service, in which case forfeited amounts shall be restored.
Notwithstanding the above paragraph, if a Participant terminates his
employment by reason of Retirement, Disability or death, the
Participant's entire Participant Account shall be nonforfeitable. A
Participant's entire Participant Account shall also become
nonforfeitable upon his attainment of Normal Retirement Age.
7.3 Distributions. Upon a Participant's termination for any reason other
than Retirement, Disability or
death, he may elect to receive a distribution of the portion of his
vested Account balance. If the Participant's Accrued Benefit is $3,500
($5,000 on or after 1/1/98) or less, the distribution shall be made
within a reasonable period after the Participant's termination of
employment but in no event later than April 1 of the calendar year
following the end of the Plan Year in which his Break in Service
occurs. The Participant shall have the sole right to elect the form of
distribution subject to the terms and conditions of Article IX.
Upon the occurrence of a Break in Service following a Participant's
termination of employment for any reason other than Retirement,
Disability or death, a Participant whose Account balance is $3,500
($5,000 on or after 1/1/98) or less shall receive a total distribution
of the balance of his vested Account balance as of the date valued by
the Trustee following the date of the Break in Service. The
distribution shall be subject to the terms and conditions of Article
IX. Payments to the Participant shall commence not later than the
Valuation Date next following the Participant's 65th birthday and any
Participant who has completed at least five Years of Service may elect
to begin payments on or after the Valuation Date next following his
55th birthday.
7.4 Distributions Prior to a Break in Service. A Participant whose
employment is terminated prior to his Retirement and who is
entitled to a cash lump sum distribution may elect to receive the
entire vested Account balance as of the date valued by the
Trustee following his termination of employment without regard to
whether he has incurred a Break in Service. In such event, that
portion of his Account which is not vested as of the date of
distribution shall be forfeited; provided, however, that if the
Participant resumes employment covered under the Plan, the
portion of his Account which was attributable to Company
Contributions as of the date of distribution, unadjusted for any
subsequent gains or losses, shall be restored.
ARTICLE VIII
TRANSFER
If a Participant shall cease to be an Eligible Employee of the Company, but
shall continue to be employed by the Company or any other corporation which is a
member of a controlled group of corporations (determined in accordance with
Section 414(b) of the Code), his contributions shall cease, the Company
Contributions made on his behalf shall cease, and such Participant shall have
the right to make withdrawals as provided in Article VI and distributions as
provided in Article IX. When such Participant subsequently ceases to be an
Employee, the extent to which he shall be entitled to his Participant Account
shall be determined in accordance with the provisions of Article VII.
ARTICLE IX
DISTRIBUTION OF BENEFITS
9.1 Retirement or Disability. The amount of a Participant's Account shall
be determined as of the valuation date next preceding actual
distribution. Payment of benefits shall be made in accordance with the
provisions of this Article.
9.2 Death. If a Participant dies while in the employment of the Company,
the amount of his Participant Account shall be nonforfeitable. Payment
of benefits shall be made to the Participant's Spouse in accordance
with the provisions of Section 9.4, Section 9.6 and Section 9.7, unless
a beneficiary has been elected in accordance with the provisions of
Section 9.8.
9.3 Form of Distribution. Any distribution of any portion of a Participant
Account made coincident with or following a Participant's death,
Disability, Retirement or termination of employment shall be
distributed in one of the following methods subject to Section 9.8, as
selected by the Participant or beneficiary by filing the appropriate
form with the Trustees:
(a) A single lump sum in cash.
(b) Direct rollover to an eligible retirement plan.
A direct rollover is a payment by the plan to an eligible retirement
plan specified by the Participant. For purposes of making a
distribution Participant includes an employee or former employee or the
employee's or former employee's surviving spouse or designated
beneficiary or the employee's or former employee's former spouse who is
an alternate payee under a qualified domestic relations order as
defined in section 414(p) of the Code.
An eligible retirement plan is an individual retirement account
described in section 408(a) of the Code, an individual retirement
annuity described in section 408(b) of the Code, an annuity plan
described in section 403(a) of the Code, or a qualified trust described
in section 401(a) of the Code, that accepts the Participant'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.
An eligible rollover distribution is any distribution of all or any
portion of the Participant's account balance, 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
Participant or the joint lives (or joint life expectancies) of the
Participant's designated beneficiary, or for a specified period of ten
years or more; any distribution to the extent such distribution is
required under section 401(a)(9) of the Code; and the portion of any
distribution that is not includible in gross income (determined without
regard to the exclusion for net unrealized appreciation with respect to
employer securities).
(c) The Trustees, upon agreement with the Participant and subject to
the provisions of Section 9.8, shall apply the Participant Account
to the purchase of an annuity contract
29
Amendment #4 dated 1/1/98 replaces all prior
issued by an insurance company. In this event, the payment will be
made in one or more of the following ways: over the life of the
participant; over the life of the participant and a designated
beneficiary; over a period certain not extending beyond the life
expectancy of the participant; or over a period certain not
extending beyond the joint life and last survivor expectancy of
the participant and a designated beneficiary.
If a Participant fails to elect a form of distribution, the
distribution shall be payable in a 50% joint and survivor annuity if
the Participant is married or a straight life annuity if the
Participant is single.
The Trustees shall distribute a notice describing the forms of
distribution available under the Plan at least 90 days before a
Participant's payments are scheduled to commence. The Participant shall
inform the Trustees of his preferred distribution form.
If a Participant's account balance is greater than $3,500 ($5,000 on or
after 1/1/98) an immediate distribution will not be made without the
consent of the Participant and where applicable, the Participant's
spouse. An immediate distribution means the distribution of any part of
the benefit prior to the later of age 62 or normal retirement age.
Distributions from the Plan will be made in accordance with the
requirements of the regulations under Section 401(a)(9), including the
minimum distribution incidental benefit requirements.
If a Participant dies before the time when distribution is considered
to have commenced (a) any remaining portion of the Participant's
interest that is not payable to a beneficiary designated by the
participant will be distributed within five years after the
Participant's death; and (b) any portion of the participant's interest
that is payable to a beneficiary will be distributed either (i) within
five years after the Participant's death , or (ii) over the life of the
beneficiary over a period certain not extending beyond the life
expectancy of the beneficiary, commencing not later than the end of the
calendar year following the calendar year in which the participant dies
(or if the designated beneficiary is the Participant's spouse,
commencing not later than the end of the calendar year following the
calendar year in which the Participant would have attained age 70 1/2).
9.4 Payment of Benefits to a Beneficiary. Unless an annuity has already
been purchased (in which case the form of payment will be in accordance
with the annuity contract), payment of benefits under Section 9.2
to a beneficiary shall be made in the form of payment elected by the
beneficiary in accordance with
Section 9.3 subject to the limitations set forth in Section 9.8.
Payment may be deferred until the date that the Participant would have
attained age 70-1/2, provided that the beneficiary is the Participant's
Spouse.
9.5 Small Payments. If the value of the Participant Account is less than
$3,500 ($5,000 on or after 1/1/98),
the Trustee shall direct that such lump value be paid in full discharge
of all liability under the Plan.
9.6 Commencement of Benefit Payments. Unless the Participant otherwise
elects, the payment of benefits shall
commence no later than 60 days after the close of the Plan Year in
which occurs the later of the Participant's Normal Retirement Date or
his termination of employment. In no event shall distribution commence
later than April 1 of the calendar year following the calendar year in
which the Participant attains age 70-1/2; provided, however, that in
the case of a participant who has attained age 70-1/2 before January 1,
1988, and is not a five percent owner (within the meaning of Code
Section 416) at any time during the Plan Year ending with or within the
calendar year in which he attains age 66-1/2 and in any subsequent Plan
Year, distribution shall commence no later than April 1 of the calendar
year following the later of the calendar year in which the Participant
attains age 70-1/2 or terminates his employment with the Company.
9.7 (a) Distributions to Married Participants. In the event that a
Participant is married on the date his distribution payments are to
begin, he shall receive his benefits in the form of a 50% joint and
survivor annuity unless he completes the election described below
within 90 days of the date his benefit payments are to begin. If he
does so elect, he may request his benefits to be paid out in one of the
payment forms described in Section 9.3.
Payments under a qualified joint and survivor annuity will commence
immediately. An election to waive a joint and survivor annuity shall be
effective only if made in accordance with Section 9.8.
At least 120 days prior to the date his benefit payments are to
commence, the Trustees shall inform the
Participant of (1) the terms and conditions of the joint and survivor
annuity form and the alternative payment forms, (2) the ability to
waive the joint and survivor annuity form (and the procedure to do so),
and (3) the ability to revoke such a waiver.
(b) Death Benefits: Married Participants.
(1) Pre-retirement Spousal Death Benefit. In the event that a married
Participant dies before he has begun to receive his benefit
payments and he has not made an election pursuant to subsection
(2) below, his surviving Spouse shall receive a death benefit
equal to 100% of the balance of his Participant Account payable
in a single life annuity or in a single lump sum in cash. The
surviving spouse may direct the commencement of payments under
the qualified pre-retirement survivor annuity within a reasonable
time after the participant's death.
(2) Election to Waive the Pre-retirement Spousal Death Benefit. A
Participant may elect to waive the benefit described in (1) above
if, at some point after he has either attained age 35 or
terminated employment, whichever comes first, he makes an
election to waive the benefit. Such waiver shall be effective
only if made in accordance with Section 9.8.
(3) Information to Participants. The Committee shall inform each
Participant of (A) the terms and conditions of the pre-retirement
spousal death benefit and the distribution alternatives, (B) the
ability to waive such benefit (and the Procedure to do so), and
(C) the ability to revoke such waiver. Such must be between the
Plan Years in which he attains age 32 and age 35, (B) a reasonable
period after the individual becomes a Participant, (C) a
reasonable period after the individual is married, (D) a
reasonable period after separation from service in the case of a
Participant who separates before attaining age 35, or (E) a
reasonable period after the individual elects distribution in the
form of a life annuity.
(c) Death Benefits: Married Participants Making an Election Described
in (b)(2) and Unmarried Participants. The account balance of either a
Participant who is not married on the date of his death or of a
Participant who has waived the benefit described in (b)(1) by making
the election described in (b)(2) and whose payment has not commenced
shall be paid upon his death to his beneficiary. Such payment shall be
made as soon as practicable after the Participant's death.
9.8 Selection of Beneficiary. Each Participant, by signing a form
approved by the Committee, may designate any person or persons
(who may be designated concurrently, contingently or
successively) to whom his benefits under the Plan are to be paid
if he dies before he receives all of such benefits. The
beneficiary of a married Participant must be such Participant's
Spouse unless the Spouse consents to the election. Spousal
consent shall be effective only if (a) it is in writing ,(b) it
designates a beneficiary or a form of benefits which may not be
changed without spousal consent, (c) it is accompanied by the
written, signed consent of the Participant's Spouse, (d) the
Spouse's signature is witnessed by a Plan representative or a
notary public, and (e) the consent comports with all other
requirements of applicable law. Notwithstanding anything herein
to the contrary, no consent shall be required if the Committee is
satisfied that the Participant's Spouse cannot be located. An
election made pursuant to this subsection may be revoked at any
time prior to the date of distribution. The consent of the spouse
shall be effective only as to the Spouse who signs the consent.
In the event that a Participant changes an election which
contains spousal consent, the spousal consent shall be
ineffective unless a new consent is executed; the spousal consent
is otherwise irrevocable.
A beneficiary designation form will be effective only when the executed
form is filed with the Committee while the Participant is alive and
will cancel all beneficiary designation forms previously filed by the
Participant.
Payment of the death benefit shall be in any method or methods
discussed in Section 9.3 as shall be chosen by the beneficiary,
provided, however, that if the Participant dies after distribution of
his interest has commenced, the remaining portion of such interest will
continue to be distributed in accordance with the option elected under
Section 9.3. If a Participant fails to designate a beneficiary before
his death as provided herein, or if the beneficiary designated by a
deceased Participant dies before him or before complete distribution of
his benefits, the Committee shall authorize distribution of the
Participant's benefits to the legal representative of the estate of the
last to die of the Participant or his beneficiary, as appropriate.
9.9 Minimum Distribution Amount. Notwithstanding any provision of this
Plan, the amount to be distributed each year, beginning with the year
which is required in accordance with Section 9.6, must not be less than
the lesser of the remaining balance in the Participant
32
Account or the amount equal to the quotient obtained by dividing the
balance in the Participant Account at the beginning of every such year
by the life expectancy of the Participant or the joint life and last
survivor expectancy of the Participant and the beneficiary, if
applicable. However, no distribution need be made in any year, or a
lesser amount may be distributed if, beginning with the year that
distributions began, the aggregate amounts distributed by the end of
such year are at least equal to the aggregate of the minimum amounts
required to have been distributed by the end of such year in accordance
with the preceding sentence.
9.10 Transfers to Other Qualified Plans and IRAs. Upon retirement or
termination of employment, a Participant may elect that all or a
portion of an eligible rollover distribution be paid in a direct
rollover to another qualified plan meeting the requirements of
Section 401(a) of the Code and which makes provisions for
receiving such transferred assets or to an individual retirement
account (including, for this purpose, an individual retirement
annuity) established for the benefit of the Participant and
meeting the requirements of Section 408 of the Code. Upon receipt
of written instructions from the Committee containing the
information necessary to effect such transfer, the Trustee and
any applicable insurance company shall, for the benefit of the
Participant, and subject to the terms and conditions of any
applicable annuity contract, so transfer such assets.
9.11 Payment of Benefits to an Alternate Payee. A qualified domestic
relations order, as defined in Section 414(p) of the Code, which
creates or recognizes the existence of an alternative payee's
right to, or assigns to an alternate payee, the right to receive
all or a portion of a Participant's benefit under the Plan, shall
not alter the amount or form of benefits payable under the Plan.
A qualified domestic relations order shall not be related as
failing to meet this paragraph if payments to such alternate
payee are made before the Participant has separated from service,
but after the date on which the Participant would have been
eligible for a benefit upon termination or retirement.
ARTICLE X
ADMINISTRATION
10.1 Allocation of Responsibility for Plan Administration. The
Administrative Committee shall have only those specific powers,
duties, responsibilities and obligations as are specifically
given under this Plan. In general, the Company shall have the
sole responsibility for making the contributions provided for
under Section 4.1, and the Company shall have the sole authority
to enter into a contract with any Investment Company and to
remove such Investment Company. The Administrative Committee
shall have the sole responsibility for the administration of this
Plan. The Trustee shall have the responsibility for the
administration of the Plan assets. The Administrative Committee
and Trustee may rely upon the direction, information or actions
of each other as being proper under this Plan, and are not
required under this Plan to inquire into the propriety of any
such direction, information or action. It is intended under this
Plan that the Administrative Committee and Trustee shall be
responsible for the proper exercise of their own powers, duties,
responsibilities and obligations under this Plan and shall not be
responsible for any act or failure to act of each other, except
to the extent required by law.
10.2 Appointment of Committee. The Administrative Committee shall consist of
not less than one nor more than seven members who shall be appointed
by, and serve at the pleasure of, the Board of Directors. The number of
members on the Administrative Committee may be increased from time to
time, and new members may be appointed by the Board of Directors. Any
member of the Administrative Committee may resign at any time, and the
Board of Directors may remove any member of the Administrative
Committee at any time.
10.3 Committee Procedures. The Administrative Committee may select a
chair and may select a secretary to keep its records or to assist
it with any other duties to be performed by the Administrative
Committee. A majority of the Administrative Committee in office
may do any act which the Plan authorizes or requires the
Administrative Committee to do, and the action of such majority
expressed from time to time by a vote at a meeting, or in writing
without a meeting, shall constitute the action of the
Administrative Committee and shall have the same effect for all
purposes as if assented to by all members of the Administrative
Committee at the time in office. The members of the
Administrative Committee may, by a writing signed by a majority
of them, delegate to any one of them the authority to give
certified notice in writing of any action taken by the
Administrative Committee.
10.4 Duties of the Committee. The Administrative Committee shall administer
the Plan and shall have the power and duty to take all action and to
make all decisions necessary or proper to carry out the Plan. Without
limiting the generality of the foregoing, the Administrative Committee
shall have the following powers and duties:
(a) To require any person to furnish such information as it may
request for the purpose of the proper administration of the Plan
as a condition to receiving any benefit under the Plan;
(b) To make and enforce such rules and regulations and prescribe the
use of such forms as it shall deem necessary for the efficient
administration of the Plan;
(c) To interpret the Plan, and to resolve ambiguities, inconsistencies
and omissions, its interpretation and resolution to be finally
conclusive and binding on all parties affected thereby; and
(d) To decide on questions concerning the Plan and the eligibility of
any Employee to participate in the Plan, in accordance with the
provisions of the Plan.
10.5 Expenses. All expenses incurred prior to termination of the Plan that
shall arise in connection with the administration of the Plan,
including but not limited to the compensation of any accountant,
counsel, specialist or other person who shall be employed by the
Administrative Committee in connection with the administration thereof,
all be paid by the Company.
10.6 Committee Member Compensation. Unless otherwise agreed to by the
Company, the members of the Administrative Committee shall serve
without compensation for services as such, but all reasonable expenses
shall be paid by the Company. The Company may only agree to compensate
members of the Administrative Committee for services as such who are
not receiving full-time pay from the Company.
10.7 Indemnification. Except to the extent insured, the Company shall
indemnify and save harmless any employee of the Company against any
cost or expense (including attorney's fees) or liability (including any
sum paid in settlement of a claim with the approval of the Company)
incurred by reason of the Employee's service as a fiduciary with
respect to the Plan, except in the case of willful misconduct.
10.8 Committee Records. The Committee may designate one of its members
to transmit all decisions of the Committee and to sign all
necessary notices and other reports or documents on behalf of the
Committee. All reports, notices or other documents bearing the
signature of the member so designated shall be deemed to bear the
signatures of all the members, and all parties dealing with the
Committee are entitled to rely on any such reports, notices or
other documents as authentic and representing the action of the
Committee. The Committee shall maintain such books of accounts,
records and other data as may be necessary or advisable in its
judgment for the purpose of the proper administration of the
Plan.
ARTICLE XI
MISCELLANEOUS PROVISIONS
11.1 Exclusive Benefit. Plan assets shall be held for the exclusive purpose
of paying benefits to Participants and beneficiaries and defraying
reasonable expenses of administering the Plan; provided that, if any
contribution is made by the Company by mistake of fact, nothing in the
foregoing shall prohibit the return of such contribution within one
year of the payment of such contribution.
11.2 Plan Amendment or Termination. The Company reserves the right to
amend, modify, suspend or terminate the Plan at any time,
provided that no amendment shall have the effect of diverting any
portion of the Plan's assets to any purpose other than for the
exclusive benefit of the Participants and beneficiaries. In the
event of the termination or partial termination of the Plan or
the complete discontinuance of contributions to the Plan, the
interest of Participants affected by the termination and their
beneficiaries under the Plan shall be nonforfeitable. No
amendment to the Plan shall decrease a Participant's Accrued
Benefit or eliminate an optional form of distribution with
respect to his Accrued Benefit as of the effective date of the
amendment. Upon the termination of the Plan, any forfeiture
remaining (after deducting any administrative expenses including
trustee, recordkeeping, auditors, consultants and counsel in the
event the Employer elects not to pay these expenses) which has
not been reallocated as of such termination shall be allocated to
each Participant, in a nondiscriminatory manner selected by the
Administrator, who is in the employment of the Company as of the
date of termination. Amendments made by the Company shall be made
by resolution of the Board of Directors of the Company adopted in
accordance with the by-laws of the Company and applicable
corporation law. Alternatively, amendments may be adopted by any
one or more officers of the Company if authority to amend the
Plan has been delegated to them by the Board of Directors in
accordance with the by-laws of the Company and applicable
corporation law. A delegation may be general (by way of
describing the general duties and responsibilities of the
officers) or specific with regard to employee benefit plans such
as this and is not invalid merely because it was made before this
Plan was established. An officer exercising delegated authority
to amend the Plan shall memorialize that exercise in writing
signed by the officer.
11.3 Merger, Consolidation or Transfer. This Plan shall not be merged or
consolidated with any other plan, nor shall its assets or liabilities
be transferred to any other plan, unless immediately after such merger,
consolidation or transfer of assets, each Participant in the Plan
would, if the Plan were then to terminate, receive a benefit not less
than the benefit which he would have been entitled to receive
immediately before such merger, consolidation or transfer had the Plan
then terminated.
11.4 No Guarantee of Employment. Nothing in this Plan shall be construed to
give any Employee a legal right to be retained in the employ of the
Company.
11.5 No Alienation of Benefits. It is a condition of the Plan, and all
rights of each Participant shall be subject thereto, that no
right or interest of any Participant in the Plan or in his
Account shall be assignable, alienable, transferable or subject
to any lien in whole or in part, either directly or by operation
of law or otherwise, including, but not by way of limitation,
execution, levy, garnishment, attachment, pledge, bankruptcy or
in any other manner, except a transfer as a result of death or
mental incompetency, and no right or interest of any Participant
in the Plan or in his Account shall be liable for, or subject to,
any obligation or liability of such Participant.
Notwithstanding the preceding paragraph, the Plan shall honor orders that are
determined by the Committee to constitute qualified domestic relations
orders within the meaning of Section 414(p) of the Code. In order to be
a qualified domestic relations order, the Committee must determine
that:
(a) it is a judgment, decree or order of a court (including approval
of a property settlement)
(b) it is made pursuant to state domestic relations law (including
community property law)
(c) it provides child support, alimony payments, or marital property
rights to your spouse, former spouse, child or other dependent.
The Plan shall not honor a domestic relations order unless it
specifies:
(a) that it applies to the Plan,
(b) the name and last known mailing address of the affected
Participant, as well as the name and last known mailing address of
all alternative payees,
(c) the amount or percentage of the Participant's benefits that are
required to be paid to each alternate payee, or the manner in
which the amount or percentage is to be determined, and
(d) the number of payments or the period to which the order applies.
The Plan shall not honor a domestic relations order if it purports to
require the Plan to:
(a) provide increased benefits,
(b) provide any type or form of benefit, or any option, that is not
already provided for in the Plan, or
c) pay to anyone any benefits that are already required to be paid to
someone else under a previous domestic relations order.
When a domestic relations order comes to the Committee, the Committee
shall notify the affected Participant and the alternate payees that the
order has been received and describe the following procedure for
deciding whether to honor the order. Next, the Committee shall
separately account for the benefits that, under the order, would be
paid to someone other than the Participant and withhold distribution
while deciding whether to honor the order.
Next, the Committee shall decide whether the order constitutes a
qualified domestic relations order. When the decision is made, the
Committee shall notify the affected Participant and the alternate
payees. Such notification shall be considered a decision on a claim,
subject to the administrative appeal procedures of Section 11.7.
If the Committee determines that the Plan will honor the order (or the
ultimate result of an appeal is that the Plan must honor the order),
the Committee shall proceed to make the payments required by the order
(or schedule them for future payment, if they are not due yet). If the
Committee decides that the Plan shall not honor the order (or the
ultimate result of an appeal is that the Plan must not honor the
order), the Committee will make payments as if there had been no order.
In the unlikely event that the Committee cannot decide whether the Plan
should honor the order within 18 months after the first payment should
have been made under the order, the Committee shall make payments as if
there had been no order until the decision is made, and then make
future payments (but no past payments) in accordance with the decision.
11.6 Gender and Number. Wherever used in this Plan, the masculine shall be
deemed to include the feminine and the singular shall be deemed to
include the plural, unless the context clearly indicates otherwise.
11.7 Administrative Committee. The Administrative Committee will operate and
administer the Plan, will determine all questions arising under or in
connection therewith, and may from time to time prescribe and amend
regulations for such administration.
The Committee shall have and shall exercise complete discretionary
authority to construe, interpret and apply all of the terms of the
Plan, including all matters relating to eligibility for benefits,
amount, time or form of benefits, and any disputed or allegedly
doubtful terms. In exercising such discretion, the Committee shall give
controlling weight to the intent of the sponsor of the Plan. All
decisions of the Committee in the exercise of its authority under the
Plan shall be final and binding of the Plan, the Plan Sponsor and all
participants and beneficiaries.
The Committee will cause the records of the Plan to be kept on a basis
that accounts separately for Participant Salary Deferral Contributions
and Company Contributions. Whenever directions, designations,
applications, requests, or other notices are to be given by a
Participant under the Plan, they shall be on forms prescribed by the
Committee and shall be filed in such manner as shall be specified by
the Committee on such forms. The Committee shall make all
determinations as to the right of any person to a benefit. If any claim
for benefits is wholly or partially denied by the Committee, written
notification shall be sent to the claimant no later than 90 days,
excluding extensions for special circumstances, after the initial claim
was filed. If such an extension is required, the claimant shall be sent
written notice of the extension prior to the termination of the initial
90-day period. In no case shall such an extension exceed a period of
180 days after the initial claim was filed. The notification of denial
shall provide the following information to the claimant:
(a) The specific reason or reasons for the denial, with specific
references to the pertinent Plan provisions on which the denial is
based;
(b) A request for any additional material or information necessary for
the claimant to correct the claim and an explanation of why such
material or information is needed;
(c) Appropriate information regarding the procedure to be followed if
the claimant wishes to appeal his claim denial. Such information
should include, but is not limited to:
(i) A statement informing the claimant that a failure to
perfect his claim within 60 days after he receives
notification of denial shall make the Committee's denial
decision conclusive.
(ii) A statement informing the claimant that he or his
personal representative may, upon written request,
require the Committee to furnish all pertinent Plan
information to the claimant.
If such appeal request is filed on a timely basis, the Committee shall
review it no later than 60 days after receipt unless special
circumstances require an extension of time for processing. If such an
extension is required, the claimant shall be sent written notice of the
extension prior to the termination of the 60-day period. In no case,
however, shall the Committee's decision on such appeal request be
delivered later than 120 days following receipt of the appeal request.
The Committee's decision shall be delivered in writing and shall
include the specific reasons for the decision and specific references
to the Plan provisions which are applicable. The determination of the
Committee to any disputed question shall be conclusive as to all
persons affected thereby.
11.8 Plan Construction. This Plan shall be construed, whenever possible, to
be in conformity with the requirements of the Code and the Employee
Retirement Income Security Act of 1974 as amended. To the extent not in
conflict with the preceding sentence, the construction and
administration of the Plan shall be governed by, and its validity
determined under, the laws of the Commonwealth of Pennsylvania.
ARTICLE XII
PROVISIONS RELATING TO TOP-HEAVY PLANS
12.1 Definitions. With respect to any Plan Year in which this Plan is a
Top-Heavy Plan (as hereinafter defined), the following additional
definitions shall apply:
a) "Affiliated Company" means any entity which with the Company forms
(1) a controlled group of corporations within the meaning of
Section 414(b) of the Code, (2) a group of trades or businesses
under common control within the meaning of Section 414(c) of the
Code, or (3) an affiliated service group within the meaning of
Section 414(m) of the Code.
(b) "Aggregation Group" means the Permissive Aggregation Group if
there is one in existence, and shall otherwise mean the Mandatory
Aggregation Group, each as hereinafter defined.
(c) "Determination Date" means, as to any Plan Year, the last day of
the preceding Plan Year.
(d) "Key Employee" means a person employed by the Company or any
Affiliated Company who, during the Plan Year or during any of the
preceding four Plan Years, was any of the following:
(1) An officer of the Company or an Affiliated Company having
an annual compensation in excess of 50% of the dollar
limitation under Section 415(b)(1)(A) of the Code. An
individual shall be considered an officer only if he (A)
is in the regular and continuous employ of the Company or
an Affiliated Company, (B) has been designated as an
officer pursuant to election or appointment by the Board
or other person or governing body having authority to
elect or appoint officers of the Company or an Affiliated
Company, and (C) is an administrative executive. The
number of persons to be considered officers in any Plan
Year and the identity of the persons to be so considered
shall be determined pursuant to the provisions of Section
416(i) of the Code and the regulations published
thereunder.
(2) One of the ten employees of the Company and the
Affiliated Companies owning (or considered as owning
under the attribution rules set forth at Section 318 of
the Code and the regulations thereunder) the largest
interest in the Company and all Affiliated Companies
(aggregated) and having an annual compensation in excess
of the dollar limitation under Section 415(c)(1)(A) of
the Code.
(3) A person who is both an employee and the owner of a
greater than 5% capital or profits interest in the
Company or in any Affiliated Company, and any person who
owns (or who, under Section 318 of the Code, is
considered as owning) more than 5% of the outstanding
stock of any entity constituting the Company or of an
Affiliated Company, or of stock possessing more than 5%
of the total combined voting power of all stock of such
entity or Affiliated Company.
40
(4) A person who is both an employee whose annual
compensation (as determined by applying the definition of
compensation set forth in Section 415(c)(3) of the Code)
from the Company and all Affiliated Companies exceeds
$150,000 and who is a greater than 1% owner of the
Company, with ownership determined pursuant to paragraph
(3) of this Section 12.1(d) by substituting "1%" for "5%"
at each place where "5%" is set forth therein.
The beneficiary of any deceased Participant who was a Key
Employee shall be considered a Key Employee for the same
period as the deceased Participant would have been so
considered.
(e) "Key Employee Ratio" means the ratio for any Plan Year, calculated
as of the Determination Date with respect to such Plan Year,
determined by dividing the amount described in paragraph (1) of
this Section 12.1(e) by the amount described in paragraph (2) of
this Section 12.1(e), after deducting from both such amounts the
amount described in paragraph (3) of this Section 12.1(e).
(1) The amount described in this paragraph (1) is the sum of
(A) the aggregate of the present value of all accrued
benefits of Key Employees under all qualified defined
benefit plans included in the Aggregation Group, (B) the
aggregate of the balances in all of the accounts standing
to the credit of Key Employees under all qualified
defined contribution plans included in the Aggregation
Group, and (C) the aggregate amount distributed from all
plans in such Aggregation Group to or on behalf of any
Key Employee during the period of five Plan Years ending
on the Determination Date.
(2) The amount described in this paragraph (2) is the sum of
(A) the aggregate of the present value of all accrued
benefits of all participants under all qualified defined
benefit plans included in the Aggregation Group, (B) the
aggregate of the balances in all of the accounts standing
to the credit of all participants under all qualified
defined contribution plans included in the Aggregation
Group, and (C) the aggregate amount distributed from all
plans in such Aggregation Group to or on behalf of any
participant during the period of five Plan Years ending
on the Determination Date.
(3) The amount described in this paragraph (3) is the sum of
(A) all rollover deposits (or similar transfers) to the
Plan initiated by an Employee and made after December 31,
1983, and (B) any amount that is included in subparagraph
(2) hereof for, on behalf of, or on account of, a person
who is a Non-Key Employee as to the Plan Year of
reference but who was a Key Employee as to any earlier
Plan Year. For purposes of this section, the accrued
benefit of any employee who has not worked as hour of
service during the preceding five plan years shall be
excluded.
(f) "Mandatory Aggregation Group" means the group of qualified plans
(including any terminated plans) sponsored by the Company or by an
affiliated Company formed by including in such group (1) all such
plans in which a Key Employee is a
participant, and (2) all such plans which enable any plan
described in clause (1) to meet the requirements of either Section
401(a)(4) of the Code or Section 410 of the Code.
(g) "Non-Key Employee" shall mean any person who is employed by the
Company or an Affiliated Company, but who is not a Key Employee as
to that Plan Year.
(h) "Permissive Aggregation Group" means the group of qualified plans
(including any terminated plans) sponsored by the Company or by an
Affiliated Company formed by including in such group (1) all plans
in the Mandatory Aggregation Group, and (2) such other qualified
plans sponsored by the Company or an Affiliated Company as the
Company elects to include in such group, as long as the group,
including those plans electively included, continues to meet the
requirements of Sections 401(a)(4) and 410 of the Code.
(i) "Super Top-Heavy Plans" means this Plan for any Plan Year in which
this Plan would be deemed to be a "Top-Heavy Plan" pursuant to
Section 12.2 of this Article XII if "90%" were substituted for
"60%" at each place where "60%" appears therein.
(j) "Top-Heavy Plan" means this Plan for any Plan Year in which this
Plan is determined to be a "Top-Heavy Plan" pursuant to the
provisions of Section 12.2 of this Article XII.
(k) "Valuation date" means the annual date on which plan assets must
be valued for the purpose of determining the value of account
balances or the date on which liabilities and assets of a defined
benefit plan are valued. For the purpose of the top-heavy test,
the valuation date for a defined benefit plan is the first day of
the Plan Year. The valuation date for a defined contribution plan
is the last day of the preceding Plan Year. The accrued benefits
and account balances used to determine the top-heavy status relate
to the this valuation date.
12.2 Determination of Top-Heavy Status. This Plan shall be deemed to be
"top-heavy" as to any Plan Year if, as of the Determination Date with
respect to such Plan Year, any of the following conditions are met:
(a) The Plan is not part of an Aggregation Group, and the Key Employee
Ratio under the Plan exceeds 60%;
(b) The Plan is part of an Aggregation Group, there being no
Permissive Aggregation Group of which the Plan is a part, and the
Key Employee Ratio of the Mandatory Aggregation Group of which the
Plan is a part exceeds 60%; or
(c) The Plan is part of an Aggregation Group, there is a Permissive
Aggregation Group of which the Plan is a part, and the Key
Employee Ratio of the Permissive Aggregation Group of which the
Plan is a part exceeds 60%.
12.3 Right to Participate in Allocation of Company's Contributions.
(a) General Rule. Notwithstanding any provision of this Plan to the
contrary, any person who was eligible to be a Participant at any
time during a Plan Year in which this Plan was a Top-Heavy Plan
shall share in the allocation provided for in Section 4.1 of
Article IV of this Plan for such Plan Year if he or she remained
in the employ of the Company or an Affiliated Company through the
end of the Plan Year with respect to which such allocation
applies.
(b) Exceptions to the General Rule. The provisions of Section 12.3(a)
of this Article XII shall not apply to any Participant for a Plan
Year if, with respect to that Plan Year:
(1) Such Participant was an active participant in a qualified
defined benefit pension plan sponsored by the Company or
by an Affiliated Company under which plan the
Participant's accrued benefit is not less than the
minimum accrued pension benefit that would be required
under Section 416(c)(1) of the Code, treating such
defined benefit pension plan as a Top-Heavy Plan and
treating all such defined benefit pension plans as
constitute an Aggregation Group as a single plan; or
(2) Such Participant was an active participant in a qualified defined
contribution plan sponsored by the Company or an Affiliated
Company under which plan the amount of the employer contribution
allocable to the account of the Participant for the accrual
computation period of such plan ending with or within the Plan
Year, exclusive of amounts by which the Participant's
compensation was reduced pursuant to a salary reduction agreement
or similar arrangement, is not less than the contribution
allocation that would be required under Section 416(c)(2) of the
Code under this Plan.
12.4 Minimum Company Contribution Allocation. The allocation made under
Section 4.1 of Article IV of this Plan to the Participant Account of
each Participant who is a Non-Key Employee for any Plan Year, including
a Plan Year in which this Plan is a Top-Heavy Plan or a Super Top Heavy
Plan, shall be not less than the lesser of:
(a) 3% of the "compensation" (as defined in Section 415 of the Code)
of each such Participant for such Plan Year; or
(b) The percentage of Compensation so allocated under Section 4.1 of
Article IV to the account of the Key Employee for whom such
percentage is the highest for such Plan Year.
If any person who is a Participant in the Plan is a participant under
any top-heavy defined benefit pension plan qualified under Section
401(a) of the Code sponsored by the Company or by an Affiliated
Company, the minimum benefit shall be provided under the defined
benefit plan. For the purposes of determining whether or not the
provisions of this Section 12.4 have been satisfied (1) contributions
or benefits under Chapter 2 of the Code (relating to tax on
self-employment income), Chapter 21 of the Code (relating to Federal
Insurance Contributions Act), Title II of the Social Security Act, or
any other federal or state law are disregarded, and (2) all defined
contribution plans in the Aggregation Group shall be treated
as a single plan. For the purposes of determining whether or not the
requirements of this Section 12.4 have been satisfied, contributions
allowable to the account of the Participant under any other qualified
defined contribution plan that is part of the Aggregation Group shall
be deemed to be contributions made under this Plan, and, to the extent
thereof, no duplication of such contributions shall be required
hereunder solely by reason of this Section 12.4. This Section 12.4
shall not apply in any Plan Year in which the Plan is part of an
Aggregation Group containing a defined benefit pension plan (or a
combination of such defined benefit pension plans) if the Plan enables
a defined benefit pension plan required to be included in such
Aggregation Group to satisfy the requirements of either Section
401(a)(4) or Section 410 of the Code.
The Employer must make any additional contribution required by this
Section from net profits.
12.5 Adjustments to Annual Additions and Combined Plans Limitations. In the
case of a top-heavy plan that does not meet the requirements of Code
Section 416 (h) (2), the denominators of the defined benefit and
defined contribution plan fractions (as described in Section 415 (e) of
the code) are computed by substituting a factor of 1.0 for 1.25.
12.6 Adjustments to Vesting Schedule. If this Plan is a Top-Heavy Plan
with respect to any Plan Year, the schedule set forth in this
Section 12.6 shall be substituted for the applicable schedule in
Section 7.2, effective as of the first day of the first Plan Year
in which this Plan is a Top-Heavy Plan; provided, however, that
the vesting interest of each person who was a Participant as of
the effective date of such substitution shall in no event be
lower at any time than his or her vested interest would have been
at such time if such vested interest were determined pursuant to
the vesting schedule as the same existed immediately prior to
such substitution.
The substitute vesting schedule referred to in this Section 12.6 is as
follows:
Period of Service Percentage of Vesting
less than 2 years 0%
2 years but less than 3 years 20%
3 years but less than 4 years 40%
4 years but less than 5 years 60%
5 years or more 100%
APPENDIX A
Groups of Employees Eligible for Participation
Location Date Participation
Commences
Birmingham, Alabama November 4, 1991
Doraville, Georgia April 1, 1990
Cheswick, Pennsylvania May 7, 1997
Ephrata, Pennsylvania May 17, 1995
Georgetown, Massachusetts November 12, 1997
Houston, Texas (with the exception of April 1, 1990
of Rail Take-Up employees)
of Rail Take-Up employees
Navasota, Texas April 1, 1990
Niles, Ohio December 1, 1986
Parkersburg, West Virginia April 1, 1990
Phoenix, Arizona April 1, 1990
Portland, Oregon April 1, 1990
Pueblo, Colorado April 1, 1990
Savannah, Georgia April 1, 1990
St. Mary's, West Virginia November 26, 1997
Stockton, California September 1, 1993
Tampa, Florida April 1, 1990
DEPARTMENT OF THE TREASURY
DISTRICT DIRECTOR
31 HOPKINS PLAZA
BALTIMORE, MD 21201-0000
L. B. FOSTER COMPANY
415 HOLIDAY DRIVE
PITTSBURGH, PA 15220-0000
Employer Identification Number
25-1324733
File Folder Number:
521004590
Person to Contact:
EP/EO CUSTOMER SERVICE UNIT
Contact Telephone Number:
(410) 9626058
Plan Name:
L.B. FOSTER CO.,
RETIREMENT SAVINGS PLAN FOR
NONUNION HOURLY EMPLOYEE
Plan Number: 012
Dear Applicant:
We have made a favorable determination on your plan, identified above,
based on the information supplied. Please keep this letter in your permanent
records.
Continued qualification of the plan under its present form will depend
on its effect in operation. (See section 1.401-1(b)(3) of the Income Tax
Regulations.) We will review the status of the plan in operation periodically.
The enclosed document explains the significance of this favorable determination
letter, points out some features that may affect the qualified status of your
employee retirement plan, and provides information on the reporting
requirements for your plan. It also describes some events that automatically
nullify it. It is very important that you read the publication.
This letter relates only to the status of your plan under the Internal
Revenue Code. It is not a determination regarding the effect of other federal
or local statutes.
This determination is subject to your adoption of the proposed
amendments submitted in your letter dated March 27, 1996. The proposed
amendments should be adopted on or before the date prescribed by the
regulations under Code section 401(b).
'This determination is also subject to your adoption of the proposed
amendments submitted in your letter(s) dated February 16, 1996. These proposed
amendments should also be adopted on or before the date prescribed by the
regulations under Code Section 401(b).
This determination letter is applicable for the amendment(s) adopted on
October 1, 1988.
This plan satisfies the minimum coverage and nondiscrimination
requirements of sections 410(b) and 401(a)(4) of the Code because the plan
(disregarding any portion that benefits solely collectively bargained
employees) benefits no highly compensated employees. This letter may not be
relied on with respect to the aforementioned requirements of the Code for any
plan year in which the plan (disregarding any portion that benefits solely
collectively bargained employees) benefits any highly compensated employees.
This letter is issued under Rev. Proc. 9339 and considers the amendments
required by the Tax Reform Act of 1986 except as otherwise specified in this
letter.
This letter may not be relied upon with respect to whether the plan
satisfies the qualification requirements as amended by the Uruguay Round
Agreements Act, Pub. L.103-465.
If you have questions concerning this matter, please contact the person
whose name and telephone number are shown above.
Sincerely yours,
/s/Paul M. Harrington
-----------------------
District Director
Enclosure(s)
Publication 794
October 16, 1998
L.B. Foster Company
415 Holiday Drive
Pittsburgh, Pennsylvania 15220
Re: Voluntary Investment Plan as Amended and
Restated and Retirement Savings Plan for Non-Union
Hourly Employees as Amended and Restated
2,000,000 Shares of Common Stock
Ladies and Gentlemen:
We have acted as your counsel in connection with the registration with
the Securities and Exchange Commission (the "Commission") of 2,000,000 shares of
your Common Stock, $.01 par value per share , (the "Shares") that may be
acquired under the subject Plans by participants in the Plans.
In that connection, we have examined originals or copies certified or
otherwise identified to our satisfaction of such documents, corporate records
and other instruments as we have deemed necessary or appropriate for the
purposes of this opinion. Based on the foregoing, we are of the opinion that the
Shares, when issued or delivered, and paid for, in accordance with the Plans,
will have been validly issued and will be fully paid and nonassessable. In
rendering this opinion we have of course assumed that the certificates
evidencing the Shares will be properly executed and authenticated.
We consent to the filing of this opinion with the Commission as an
exhibit to the Registration Statement on Form S-8 for registration of the Shares
under the Securities Act of 1933, as amended.
Very truly yours,
/s/ Klett Lieber Rooney & Schorling
-------------------------------------
KLETT LIEBER ROONEY & SCHORLING,
a Professional Corporation
Exhibit 5
Consent of Independent Auditors
We consent to the incorporation by reference in the Registration Statement (Form
S-8) pertaining to the Voluntary Investment Plan as Amended and Restated and
Retirement Savings Plan for Non-Union Hourly Employees as Amended and Restated
of our report dated January 21, 1998, with respect to the consolidated financial
statements and schedule of L. B. Foster Company included in its Annual Report
(Form 10-K) for the year ended December 31, 1997, filed with the Securities and
Exchange Commission.
/s/Ernst & Young LLP
Exhibit 23