K&F Industries Savings Plan for Salaried Employees (March 2006 Edition)
This agreement establishes the K&F Industries Savings Plan for Salaried Employees, outlining the rules for employee participation, contributions, vesting, investment options, withdrawals, and benefit payments. The plan is designed to help eligible salaried employees save for retirement, with both employee and employer contributions, and is governed by federal laws such as ERISA and the Internal Revenue Code. The document details eligibility, contribution limits, withdrawal options, and administrative procedures, ensuring compliance with applicable regulations and providing retirement benefits to participants.
INTRODUCTION | -1- | |||
ARTICLE I. DEFINITIONS | -3- | |||
Account | -3- | |||
Affiliate | -3- | |||
After-Tax Contributions | -3- | |||
Alternate Payee | -3- | |||
Bargaining Employee | -3- | |||
Beneficiary | -4- | |||
Board | -4- | |||
Board of Directors | -4- | |||
Break in Service | -4- | |||
Code | -4- | |||
Committee | -4- | |||
Company | -5- | |||
Compensation | -5- | |||
Deferral Change Date | -5- | |||
Disability | -6- | |||
Disability Retirement Date | -6- | |||
Effective Date | -6- | |||
Employee | -6- | |||
Employer | -6- | |||
Employer Contribution Rate | -6- | |||
Employment Commencement Date | -6- | |||
Enrollment Date | -6- | |||
Equity Fund | -6- | |||
ERISA | -7- | |||
Former Participant | -7- | |||
Fund | -7- | |||
Highly Compensated Employee | -7- | |||
Hour of Service | -7- | |||
Income Fund | -7- | |||
Investment Funds | -7- | |||
Matching Employer Contributions | -7- | |||
Normal Retirement Date | -7- | |||
Participant | -8- | |||
Plan | -8- |
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Plan Year | -8- | |||
Period of Severance | -8- | |||
Pre-Tax Deferral | -8- | |||
Prior Plan | -8- | |||
Retirement Date | -8- | |||
Rollover Contribution | -8- | |||
Salaried Employee | -8- | |||
Service | -9- | |||
Tax-Deferred Contributions | -9- | |||
Total Compensation | -9- | |||
Transfer Amount | -9- | |||
Trust Agreement | -10- | |||
Trustee | -10- | |||
Trust | -10- | |||
Trust Fund | -10- | |||
Valuation Date | -10- | |||
Year of Service | -10- | |||
ARTICLE II. EMPLOYEE PARTICIPATION | -11- | |||
2.1 Eligibility and Election to Participate | -11- | |||
2.2 General Rules of Eligibility | -11- | |||
2.3 How to Calculate Service for Vesting for K&F and ABS | -12- | |||
2.4 How to Calculate Service for Vesting for EFC | -14- | |||
2.5 General Restrictions on Participation | -15- | |||
ARTICLE III. VESTING AND FORFEITURES | -16- | |||
3.1 Immediate Vesting Provisions | -16- | |||
3.2 Vesting of Employer Contributions in Matching Employer Contribution Account | -16- | |||
3.3 Forfeitures | -16- | |||
3.4 Restoring Forfeitures | -16- | |||
ARTICLE IV. TAX-DEFERRED AND ROLLOVER CONTRIBUTIONS | -17- | |||
4.1 Tax-Deferred Contributions | -17- | |||
4.2 After-Tax Contributions | -17- | |||
4.3 Amount of Tax-Deferred Contributions | -17- | |||
4.4 General Rules | -17- | |||
4.5 Timing of Contributions | -18- | |||
4.6 Changes in Compensation Reduction Authorization | -18- | |||
4.7 Suspension of Contributions | -18- | |||
4.8 Resumption of Contributions | -18- |
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4.9 Rollover Contributions | -19- | |||
ARTICLE V. MATCHING EMPLOYER CONTRIBUTIONS | -20- | |||
5.1 Payment of Contributions | -20- | |||
5.2 Limitation on Amount under Code Sections 404 and 415 | -20- | |||
5.3 Allocation of Matching Employer Contributions | -21- | |||
5.4 Employer Contribution Rate | -21- | |||
5.5 Determination of Amount of Employer Contribution | -21- | |||
5.6 Effect of Plan Termination | -21- | |||
ARTICLE VI. INVESTMENT OF CONTRIBUTIONS TRANSFERS BETWEEN FUNDS | -22- | |||
6.1 Investment Elections of Participants | -22- | |||
6.2 Deposit of Contributions | -22- | |||
ARTICLE VII. FUNDS, ACCOUNTS, AND THEIR VALUATION | -23- | |||
7.1 Trust Fund | -23- | |||
7.2 Establishment of Funds | -23- | |||
7.3 Income on Funds | -23- | |||
7.4 Accounts | -23- | |||
7.5 Account Balances | -24- | |||
7.6 Finality of Determinations | -24- | |||
7.7 Notification | -24- | |||
ARTICLE VIII. LIMITATIONS ON CONTRIBUTIONS | -25- | |||
8.1 Section 401(k) Limit on Pre-Tax Deferrals | -25- | |||
8.2 Section 401(m) Limit on Matching Contributions | -26- | |||
8.3 Special Rules | -28- | |||
8.4 Section 415 Limits | -29- | |||
ARTICLE IX. IN-SERVICE WITHDRAWALS; LOANS | -33- | |||
9.1 Withdrawal of Rollover and After-Tax Contributions | -33- | |||
9.2 Withdrawal of Matching Employer Contributions | -33- | |||
9.3 Withdrawal of Tax-Deferred Contributions | -33- | |||
9.4 Hardship Withdrawals | -34- | |||
9.5 Payment of Withdrawals | -35- | |||
9.6 Adjustment of Accounts | -36- | |||
9.7 Loans | -36- | |||
ARTICLE X. PAYMENT OF BENEFITS | -38- |
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10.1 Distribution on Termination of Employment | -38- | |||
10.2 Method of Distribution | -38- | |||
10.3 Required Payment Dates | -38- | |||
10.4 Payments on Account of Participants Death | -39- | |||
10.5 Direct Rollover Distributions to Other Plans or IRAs | -40- | |||
ARTICLE XI. ADMINISTRATION | -42- | |||
11.1 Named Fiduciary | -42- | |||
11.2 Other Fiduciaries Appointed Under Trust Provisions | -42- | |||
11.3 The Committee | -42- | |||
11.4 Committees Discretionary Power to Interpret and Administer the Plan | -42- | |||
11.5 Trustees Duty to Withhold Taxes | -43- | |||
11.6 Claims Procedure | -43- | |||
11.7 QDRO Claim | -44- | |||
11.8 Indemnification of Committee Members | -45- | |||
11.9 Power to Execute Plan and Other Documents | -45- | |||
ARTICLE XII. AMENDMENT, TERMINATION AND MERGER | -46- | |||
12.1 Trust is Irrevocable | -46- | |||
12.2 Limitations on Amendment | -46- | |||
12.3 Discontinuance of Contributions | -46- | |||
12.4 Termination Date | -47- | |||
12.5 Termination | -47- | |||
12.6 Merger | -47- | |||
ARTICLE XIII. GENERAL PROVISIONS | -49- | |||
13.1 No Commitment as to Employment | -49- | |||
13.2 Benefits | -49- | |||
13.3 No Guarantees | -49- | |||
13.4 Expenses | -49- | |||
13.5 Precedent | -49- | |||
13.6 Duty to Furnish Information | -49- | |||
13.7 Withholding | -50- | |||
13.8 Back Pay Awards | -50- | |||
13.9 Exclusive Benefit and Revision of Employer Contributions | -50- | |||
13.10 Return of Contributions to Participants | -51- | |||
13.11 Headings | -51- | |||
13.12 Applicable State Law | -51- | |||
13.13 Plan Shall Comply With Federal Law | -52- | |||
13.14 Missing Payee | -52- | |||
13.15 Parties Bound | -52- |
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13.16 Trust Fund Sole Source of Payments for Plan | -52- | |||
13.17 Common Trust Funds | -52- | |||
13.18 Transfers Among Affiliates | -53- | |||
13.19 Assignments | -55- | |||
13.20 QDROs | -55- | |||
13.21 Deemed Distribution of Unvested Amounts | -56- | |||
13.22 Incompetency or Minority of Payee | -56- | |||
13.23 Gender and Number | -57- | |||
13.24 ERISA Section 404(c) | -57- | |||
13.25 Notice to the Committee | -57- | |||
13.26 Consent for Distributions Paid Before Normal Retirement Date | -58- | |||
13.27 Illegality of Particular Provisions | -58- | |||
13.28 Condition of Contributions | -58- | |||
13.29 Qualified Military Service | -58- | |||
ARTICLE XIV. TOP-HEAVY PROVISIONS | -60- |
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(1) | Restated, effective May 1, 1989, reflecting amendments made through September 1, 1991. | ||
(2) | Restated, effective May 1, 1989, reflecting amendments made through December 20, 1994. |
(1) | Restated, effective May 1, 1989, reflecting amendments made through September 1, 1991. | ||
(2) | Restated, effective May 1, 1989, reflecting amendments made through January 1, 1992. |
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(a) | any common-law employee in the service of an Employer whose terms of employment are subject to a collective bargaining agreement to which the Employer is a party, and whose agreement specifically calls for participation in this Plan, including officers, but excluding directors who are not in the Employers employ in any other capacity. | ||
(b) | Bargaining Employees shall, as prescribed by the Code, also include employees of Affiliates. Leased employees as described by Code Section 414(n), shall be considered Employees for the sole purpose of Code Section 414(n)(3). |
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(a) | The Beneficiary of any married Participant shall normally be his legally married spouse, at the time of death. Married Participants may designate someone other than a spouse as Beneficiary, only if the designation includes the written consent of the Participants spouse acknowledging the effect of the Beneficiary designation and witnessed by a Plan representative or a notary public. If these requirements are not met then the designation of a non-spouse Beneficiary is invalid. However, the Committee may not require the spouses written consent if it is established to the satisfaction of a Plan representative that such consent cannot be obtained because (a) there is no spouse, (b) the spouse cannot be located, or (c) such other circumstances exist as may be prescribed by applicable regulation. Any such written spousal consent or establishment that consent cannot be obtained shall be effective only with respect to that spouse. | ||
(b) | Beneficiary designations may be changed at any time. If no proper Beneficiary is designated or survives, the Participants Beneficiary shall be, in the following order of priority: (1) his spouse, if living at the time of such payment; (2) his children (including adopted children but excluding stepchildren) per stirpes; (3) his estate. | ||
(c) | If the Committee is in doubt as to the right of any person to receive a Plan benefit, the Committee may direct the Trustee to retain such amount, without liability for any interest thereon, until the rights thereto are determined, or the Committee may direct the Trustee to pay such amount into any court of appropriate jurisdiction and such payment shall be a complete discharge of the liability of the Plan and the Trust therefor. |
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(a) | all cash remuneration paid by the Employer that is includible during the relevant Plan Year, including regular earnings; bonus; commissions; overtime pay; lump sum vacation pay; Code Section 125 elective, payroll deduction contributions; and elective employee deferrals or deduction contributions made under this Plan or any other qualified retirement plan during the Plan Year. However, the following items will be excluded: distributions from this Plan or any other qualified retirement plan; distributions from employee welfare plans; all supplemental unemployment pay; lump sum severance pay; deferred income; fringe benefits; stock options (with respect to their granting or execution); reimbursed expenses; any unemployment benefits; imputed income from life insurance, or any other imputed income; any employer contributions made under any qualified retirement plan or welfare plan. | ||
(b) | (1) Effective as of January 1, 1997, Compensation accounted under this Plan shall not exceed $160,000, as adjusted for cost of living, as provided by Code Section 401(a)(17) (the Compensation Limit). Effective as of January 1, 2002, the Compensation Limit shall be $200,000. |
(2) | If a cost of living adjustment is declared under the Code with respect to any calendar year, it shall affect the Compensation accounted for the Plan Year that begins during the course of that calendar year, or that begins on the January 1st of that same calendar year. | ||
(3) | Should the Plan be amended so that Compensation paid for any prior Plan Year is taken into account in determining benefit accruals for the current Plan Year, then the Compensation Limit for the prior year will be subject to the Code Section 401(a)(17) limit applicable (adjusted for the cost of living) for that prior year. | ||
(4) | If a Participant is not actively employed for a full Plan Year, then his credited Compensation under Code Section 401(a)(17) shall not be reduced, prorated, or limited because of his incomplete year of service. |
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(a) | The Loral Systems Group Employee Savings Plan for Salaried Employees, with respect to Participants who are Salaried Employees, and |
(b) | The Loral Systems Group Employee Savings Plan for Bargaining Unit Employees, with respect to Participants who are Bargaining Employees. | ||
(c) | Account balances from the Prior Plan were transferred to this Plan. |
(a) | any common-law employee of an Employer, including officers, but excluding directors who are not in the Employers employ in any other capacity. | ||
(b) | Salaried Employees shall, as prescribed by the Code, also include employees of Affiliates. Leased employees as described by Code Section 414(n), shall be considered Employees for the sole purpose of Code Section 414(n)(3). |
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(x) | a person who is employed in an excluded unit or excluded subsidiary which the Board of Directors may designate, or change any such designation, from time to time and upon any reasonable basis of classification, without formal Plan amendment, or | ||
(y) | persons whose terms of employment with an Employer are subject to a collective bargaining agreement to which the Employer is a party, unless the agreement specifically provides for participation in the Plan. |
(i) | the period for which the Employee is paid or is entitled to payment (including any back pay, irrespective of mitigation of damages), subject to the rules and restrictions of Article II, for the performance of duties for an Employer. For the purposes of calculating vesting service, Service shall also include Service performed for an Affiliate. | ||
(ii) | With respect to any period for which an Employee was subject to a Prior Plan, or an earlier restatement of this Plan, then service shall be calculated under that earlier Plan. |
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(a) | Timing of Eligibility. |
(1) | Each Employee who was a Participant in the Plan on December 31, 1996, shall continue as a Participant on and after January 1, 1997. | ||
(2) | Each other Employee shall become a Participant as of any Enrollment Date, if he has filed with the Committee or its delegate a written election in the form prescribed by the Committee within a reasonable time prior to the applicable Enrollment Date. |
(b) | Method of Election. An Employees election shall contain: |
(1) | his authorization for his Employer to reduce his Compensation and to make Tax- Deferred Contributions on his behalf in accordance with the provisions of Article IV, | ||
(2) | an authorization for his Employer to make any payroll deductions with respect to his After-Tax Contributions to the Plan in accordance with the provisions of Article IV, and | ||
(3) | his election as to the investment of his Tax-Deferred Contributions and After-Tax Contributions, if applicable, in accordance with the provisions of Section 6.1. |
(a) | Upon becoming a Participant, an Employee shall be entitled to the benefits and shall be bound by all the terms and conditions of the Plan and the Trust Agreement. | ||
(b) | Participants shall cease to be Participants should (i) they cease to be Employees, (ii) they cease to be eligible Employees under the Plan, or (ii) the Plan be so amended, or terminated. |
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(c) | In the event that an Employee shall go from a classification of an eligible Employee to a non-eligible Employee, he shall continue to be a Participant for all purposes until the date he became a non-eligible Employee, and shall thereafter be a Former Participant for so long as he is entitled to receive any benefits under the Plan. | ||
(d) | Participants or Former Participants who participated in the Prior Plan shall similarly be subject to the terms of the Prior Plan (including, but not limited to its provisions regarding benefits and vesting) as they were in effect during the relevant periods. | ||
(e) | Should any Employee who is excluded from participation because (1) he is subject to a collective bargaining agreement that does not provide for Plan participation, or (2) he is employed by an excluded unit or subsidiary, no longer be excluded for either of such reasons, then he shall be eligible to participate in the Plan on the first payroll period following the date that he (1) is no longer excluded and (2) is eligible under this Article. | ||
(f) | A former Participant who is reemployed by the Employer shall again become a Participant as of the date he again becomes an Employee, provided he renews his elective deferrals, under Plan procedures. |
(a) | Service shall be calculated under this Section only for the purposes of vesting under Article III. | ||
(b) | Service begins on the date of hire, or the first day of reemployment with an Employer or an Affiliate. Service includes periods of lay-off, vacation, or Employer-approved leave of absence, provided that such periods of vacation, lay-off or leave do not exceed twenty-four consecutive months. (Should such periods of vacation, lay-off or leave occur simultaneously, or consecutively, they shall be aggregated in determining the maximum period of twenty-four months of credited Service.) If a period of vacation, lay-off, and/or leave exceeds twenty-four continuous months, then the portion that is more than twenty-four months shall not be credited as Service. | ||
(c) | If a Break in Service occurs, then any Period of Severance that occurs on account of a retirement, quit, or discharge shall not be credited as Service. Service accrual ends with a Break in Service. Upon incurring a Break in Service, a Participant shall become a Former Participant. |
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(d) | A Break in Service occurs when a Period of Severance continues for twenty-four or more consecutive months, during which the individual does not perform an Hour of Service. | ||
(e) | A Period of Severance is any continuous period, during which the individual has had a separation from service from an Employer or any Affiliate, on account of lay-off, leave, vacation, retirement, quit, discharge, any other reason, or any combination of the preceding reasons. | ||
(f) | However, if an individual incurs a Period of Severance on account of a retirement, quit, or discharge, but has not incurred a Break in Service, then his Period of Severance shall be credited as Service. By the same rule, if (in this instance) he does incur a Break in Service, then the Period of Severance is not credited as service. | ||
(g) | A special rule applies to Employer-approved leave on account of maternity or paternity, meaning on account of pregnancy, the birth of a child, the placement of a child in connection with an adoption, or the caring for such a child immediately following the birth or placement. Any period of Employer-approved leave on account of maternity or paternity shall be credited as Service, through the first anniversary of the first date of such an absence. Any period of such an Employer-approved leave that continues past the first anniversary, through the second anniversary (that is, any continuous period of two years or less), shall not be credited as Service, nor shall it count as any Period of Severance. The Period of Severance relating to such an Employer-approved leave shall only begin on the second anniversary of the first date of the maternity or paternity absence from service. | ||
(h) | For the purposes of vesting only, Service performed for Loral Defense Systems (formerly known as Loral Systems Group), a division of Loral Corporation, will be credited if it was performed before May 1, 1991. In no circumstances will any Plan participant be given credit for the purposes of Plan benefit accruals, for any service performed for Loral Defense Systems after that date. | ||
(i) | Service shall not be credited for service under the Prior Plan unless the Employee was (1) an active Employee under the Prior Plan on April 30, 1989, and (2) was immediately transferred as an active Employee under this Plan as of May 1, 1989. |
(j) | Service shall be credited for vesting purposes for service performed by a common-law employee of an Employer who is not an Employee. |
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(a) | Service shall be calculated under this Section only for the purposes of vesting under Article III. | ||
(b) | Service begins on the date of hire, or the first day of reemployment with an Employer or an Affiliate. Service includes periods of lay-off, vacation, or Employer-approved leave of absence, provided that such periods of vacation, lay-off or leave do not exceed twelve consecutive months. (Should such periods of vacation, lay-off or leave occur simultaneously, or consecutively, they shall be aggregated in determining the maximum period of twelve months of credited Service.) If a period of vacation, lay-off, and/or leave exceeds twelve continuous months, then the portion that is more than twelve months shall not be credited as Service. | ||
(c) | If a Break in Service occurs, then any Period of Severance that occurs on account of retirement, quit, or discharge shall not be credited as Service. Service accrual ends with a Break in Service. Upon incurring a Break in Service, a Participant shall become a Former Participant. | ||
(d) | A Break in Service occurs when a Period of Severance continues for twelve or more consecutive months, during which the individual does not perform an Hour of Service. | ||
(e) | A Period of Severance is any continuous period, during which the individual has had a separation from service from an Employer or any Affiliate, on account of lay-off, leave, vacation, retirement, quit, discharge, any other reason, or any combination of the preceding reasons. | ||
(f) | However, if an individual incurs a Period of Severance on account of a retirement, quit, or discharge, but has not incurred a Break in Service, then his Period of Severance shall be credited as Service. By the same rule, if (in this instance) he does incur a Break in Service, then the Period of Severance is not credited as service. | ||
(g) | A special rule applies to Employer-approved leave on account of maternity or paternity, meaning on account of pregnancy, the birth of a child, the placement of a child in connection with an adoption, or the caring for such a child immediately following the birth or placement. Any period of Employer-approved leave on account of maternity or paternity shall be credited as Service, through the first anniversary of the first date of such an absence. Any period of such an Employer-approved leave that |
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continues past the first anniversary, through the second anniversary (that is, any continuous period of two years or less), shall not be credited as Service, nor shall it count as any Period of Severance. The Period of Severance relating to such an Employer-approved leave shall only begin on the second anniversary of the first date of the maternity or paternity absence from service. | |||
(h) | For the purposes of vesting only, Service performed for Loral Defense Systems (formerly known as Loral Systems Group), a division of Loral Corporation, will be credited if it was performed before May 1, 1991. In no circumstances will any Plan participant be given credit for the purposes of Plan benefit accruals, for any service performed for Loral Defense Systems after that date. | ||
(i) | Service shall not be credited for service under the Prior Plan unless the Employee was (1) an active Employee under the Prior Plan on April 30, 1989, and (2) was immediately transferred as an active Employee under this Plan as of May 1, 1989. | ||
(j) | Service shall be credited for vesting purposes for service performed by a common-law employee of an Employer who is not an Employee. |
(a) | An eligible Employee will be able to actively participate in this Plan only during those periods during which he is (1) in service with the specific participating Employer (rather than with any Affiliate), and (2) the Plan is in effect. | ||
(b) | In order to become a Participant, each eligible Employee must make proper application, on the appropriate forms (written or electronic) provided by the Committee, to participate in the Plan, agree to the terms of the Plan, and agree to make Tax-Deferred Contributions. Continued participation will always be conditioned on the Employees continued Tax-Deferred Contributions. | ||
(c) | Leased employees, as described in Code Section 414(n), are not eligible to be Participants. |
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(a) | The Committee may, in its sole discretion, authorize Employees to make contributions under the Plan which qualify as rollover amounts under to the extent permitted by applicable law. Such rollovers shall exclude after-tax employee contributions. The Committee shall exercise such discretion on a nondiscriminatory basis. An Employee who makes a Rollover Contribution shall be deemed a Participant under this Plan solely with respect to his Rollover Account until he otherwise qualifies as a Participant in accordance with the other provisions of this Plan. All Rollover Contributions shall be received by the Trustee, and shall be credited to the Employees name as of such date as the Committee shall specify. Such Rollover Contributions shall be accounted for and distributed in accordance with the rules applicable to Tax-Deferred Contribution Accounts (except as otherwise provided in Articles IX and X). An Employee who makes a rollover shall be entitled to invest his initial Rollover Contribution in any one or more of the available Investment Funds by designating on the written election form the percentage of such Rollover Contributions to be invested in each of the Funds. Thereafter, his Rollover Contribution Account shall be invested in accordance with any election the Participant otherwise makes regarding the investment of existing account balances pursuant to Section 6.1. |
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(a) | Each Employer shall pay to the Trustee as its Matching Employer Contributions hereunder for each calendar month an amount that is equal to the Employer Contribution Rate multiplied by the aggregate of: |
(1) | the Tax-Deferred Contributions made by such Employer on behalf of each Participant during such calendar month; plus | ||
(2) | the After-Tax Contributions (if any) made by each Participant during such calendar month based on Compensation paid by such Employer during such calendar month; | ||
provided, however, that such aggregate amount shall not include any portion of the sum of the Tax-Deferred Contributions and After-Tax Contributions (if any) of a Participant with respect to such calendar month that is in excess of six percent of his Compensation for such calendar month. |
(b) | Notwithstanding the preceding provisions, the schedule for making Matching Employer Contributions may be changed, as determined within the sole discretion of the Committee, which shall be effective without formal Plan amendment. | ||
(c) | The payment of Matching Employer Contributions for any month will be made in cash deposited into Investment Funds in accordance with the Participants election made under Article VI. | ||
(d) | Notwithstanding any other provision of the Plan, the Employer may, within its sole discretion, determine not to make Matching Employer Contributions with respect to any number of months or number of Plan Years. Such a determination shall be made by the Employers Board of Directors, subject to ERISA. |
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INVESTMENT OF CONTRIBUTIONS
TRANSFERS BETWEEN FUNDS
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(a) | The Committee shall determine, during and as of the end of each Plan Year, the Actual Deferral Percentages relevant for purposes of this Section based on the actual and projected rate for each Participant of his Total Compensation and Pre-Tax Deferrals for the remainder of the Plan Year. If, based on such determination, the Committee concludes that a reduction in the Pre-Tax Deferrals for any Participant is necessary or advisable in order to comply with the limitations of clause (A) or (B) of this paragraph, it shall so notify each affected Participant and his Employer of the reduction that it deems necessary or desirable for this purpose. In such event, the maximum allowable Pre-Tax Deferrals shall be reduced in accordance with the direction of the Committee, and the contribution election of each Participant affected by such determination shall be modified accordingly. Any such reduction may apply either to all Participants, only to Participants who are Highly Compensated Employees, or to any other group as the Committee shall determine, and in such manner as the Committee shall determine in its sole discretion. |
(A) | The Actual Deferral Percentage (as defined in clause (C) of this paragraph) for the group of Highly Compensated Employees being tested is not more than the prior Plan Years Actual Deferral Percentage of Participants who were not Highly Compensated Employees for the prior Plan Year multiplied by 1.25. | ||
(B) | The excess of the Actual Deferral Percentage for such group of Highly Compensated Employees over the prior Plan Years Actual Deferral Percentage for Participants who were not Highly Compensated Employees for the prior Plan Year is not more than 2%, and the Actual Deferral Percentage for such group is not more than the Actual Deferral Percentage of Participants who were not Highly Compensated Employees in the prior Plan Year multiplied by 2.0. | ||
(C) | For the purposes of clauses (A) and (B) of this paragraph: |
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(A) | The amount of Pre-Tax Deferrals on behalf of each such Participant for such Plan Year (including the amount of any Excess Deferrals (as defined in the Plan) distributed to a Participant pursuant to the Plan), bears to | ||
(B) | Such Participants Total Compensation for such Plan Year; |
(b) | Any excess contributions paid into the Plan for any Plan Year shall be distributed in cash to the Highly Compensated Employees on whose behalf they were paid into the Plan, no later than 21/2 months after the end of such Plan Year, if at all possible, and in any event no later than the close of such following Plan Year. The amount distributed to any such Participant shall be increased or decreased by a pro rata share of the net income or loss attributable to such excess contributions as determined by the Committee in accordance with applicable regulations. If such Participants Account is invested in more than one Investment Fund, such distribution shall be made pro rata, to the extent practicable, from all such Investment Funds. For purposes of this Subsection 8.1(b), excess contributions means, with respect to any Plan Year, the excess of (a) the aggregate amount of Pre-Tax Deferrals actually paid into the Plan on behalf of Highly Compensated Employees for such Plan Year, over (b) the maximum amount of such contributions permitted for such Plan Year under the limitations set forth above, determined by reducing the amount of Pre-Tax Deferrals to be permitted beginning with the Highly Compensated Employee with the largest dollar amount of such Pre-Tax Deferrals and continuing in descending order until all the excess contributions have been distributed. |
(a) | The Committee shall determine, during and as of the end of each Plan Year, the Contribution Percentage relevant for purposes of this Section, based on the actual and projected rate for each Participant of his Total Compensation, any matching Employer Contributions, and employee after-tax contributions. If, based on such determination, the Committee concludes that a reduction in matching Employer Contributions or after-tax contributions made for any Participant is necessary or advisable in order to comply |
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with the limitations of this clause (A) or (B) of this paragraph, it shall so notify each affected Participant and his Employer of the reduction that it deems necessary or desirable for this purpose. In such event, the maximum allowable with respect to any matching Employer Contributions and after-tax contributions shall be reduced in accordance with the direction of the Committee. Any such reduction may apply either to all Participants, only to Participants who are Highly Compensated Employees, or to any other group as the Committee shall determine, and in such manner as the Committee shall determine in its sole discretion. |
(1) | The Contribution Percentage (as defined below) for the group of Highly-Compensated Employees being tested is not more than the prior Plan Years Contribution Percentage of Participants who were not Highly Compensated Employees multiplied by 1.25. | ||
(2) | The excess of the Contribution Percentage for such group of Highly-Compensated Participants over the Contribution Percentage over the prior Plan Years Contribution Percentage for Participants who were not Highly Compensated Employees is not more than 2%, and the Contribution Percentage for such group of Highly-Compensated Participants is not more than the Contribution Percentage of all other Participants who were not Highly Compensated Employees in the prior Plan Year multiplied by 2.0. | ||
(3) | For the purposes of clauses (i) and (ii) of this paragraph; |
(A) | The amount of any matching Employer Contributions on behalf of, and the after-tax contributions by, each such Participant for such Plan Year, bears to | ||
(B) | Such Participants Total Compensation, for such Plan Year; and |
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(b) | Any excess aggregate contributions paid into the Plan for any Plan Year shall be distributed in cash to the Highly Compensated Employees on whose behalf they were paid into the Plan, no later than 21/2 months after the end of such Plan Year, if at all possible, and in any event no later than the close of such following Plan Year. The amount distributed to any such Participant shall be increased or decreased by a pro rata share of the net income or loss attributable to such excess aggregate contributions as determined by the Committee in accordance with applicable regulations. If such Participants Account is invested in more than one Investment Fund, such distribution shall be made pro rata, to the extent practicable, from all such Investment Funds. For purposes of this Section, excess aggregate contributions means, with respect to any Plan Year, the excess of (a) the aggregate amount of any Matching Employer Contributions or After-Tax Contributions actually paid into the Plan on behalf of Highly Compensated Employees for such Plan Year, over (b) the maximum amount of such contributions permitted for such Plan Year under the limitations set forth above, determined by reducing the amount of any Matching Employer Contributions and After-Tax Contributions on behalf of Highly Compensated Employees beginning with the Highly Compensated Employee with the largest amount of excess aggregate contributions and continuing in descending order until all the excess aggregate contributions have been distributed. |
(a) | Aggregate Limit. For Plan Years beginning prior to January 1, 2002, in the event that both the Actual Deferral Percentage and the Contribution Percentage (as defined above) for Participants who are Highly Compensated Employees for the Plan Year are more than one and one-quarter (11/4) times the corresponding percentage for Participants who are not Highly Compensated Employees for the prior Plan Year, the Pre-Tax Deferrals for Participants who are Highly Compensated Employees for the Plan Year shall be further reduced in order that the sum of the Actual Deferral Percentage plus the Contribution Percentage for Participants who are Highly Compensated Employees does not exceed the aggregate limit (as defined below) for the Plan Year. |
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(b) | Multiple Arrangements for Highly Compensated Employees Combined. If more than one plan providing a cash or deferred arrangement, matching contributions, or employee contributions (within the meaning of sections 401(k) and 401(m) of the Code) is maintained by the Employer or an Affiliate, the Actual Deferral Percentage and Contribution Percentage of any Participant who is a Highly Compensated Employee who participates in more than one such plan or arrangement shall be determined as if all such arrangements were a single plan or arrangement. | ||
(c) | Aggregation of Plans. In the event that the Plan satisfies the requirements of section 410(b) of the Code only if aggregated with one or more other plans, then the foregoing provisions of this Article shall be applied by determining the Actual Deferral Percentage and Contribution Percentage of Participants as if all such plans were a single plan. |
(a) | Notwithstanding any other contrary provision of the Plan, the maximum amount of annual additions which may be credited to a Participants Accounts for any Limitation Year (that is, the Plan Year) shall not exceed the lesser of (i) the dollar limit set forth in Code Section 415(c)(1)(A); or (ii) 25% (100% for Plan Years beginning on or after January 1,2002) of his Section 415 earnings (as defined in paragraph (d) of this Section) for such Plan Year. For the purpose of this paragraph, a Participants annual additions for any Limitation Year shall mean the sum of (a) employer contributions and forfeitures allocable to a Participant under all plans (or portions thereof) maintained by |
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an Employer or an Affiliate subject to section 415(c) of the Code, (b) the Participants employee contributions under all such plans (or portions thereof), and (c) amounts described in section 419A(d)(2) of the Code (relating to post-retirement medical benefits of key employees) or allocated to a pension plan individual medical account described in section 415(l) of the Code, to the extent includible for purposes of section 415(c)(2) of the Code. A Participants employee contributions described in clause (b) shall be determined without regard to (i) any rollover contributions, (ii) any repayments of loans, or (iii) any prior distributions repaid upon the exercise of buy-back rights. Employer and employee contributions taken into account as Annual Additions shall include excess contributions as defined in section 401(k)(8)(B) of the Code, excess aggregate contributions as defined in section 401(m)(6)(B) of the Code, and excess deferrals as described in section 402(g) of the Code, regardless of whether such amounts are distributed or forfeited (to the extent such excess deferrals are not distributed to the Participant before the end of the taxable year of the Participant in which such deferrals were made). |
(b) | In the event that the annual additions to the Accounts of a Participant for any Limitation Year would exceed the limitation set forth in paragraph (a) of this Section, such Participants annual additions for such Limitation Year shall be reduced by the amount required in order to eliminate such excess in the following order: |
(1) | the After-Tax Contributions made by a Participant for such Limitation Year, if any, shall be reduced; | ||
(2) | the Pre-Tax Deferrals not subject to any Matching Employer Contributions on such Participants behalf for such Limitation Year, if any, shall be reduced; | ||
(3) | the Pre-Tax Deferrals subject to any Matching Employer Contributions on such Participants behalf and any matching Employer Contributions and forfeitures for such Limitation Year shall then be reduced pro rata in the proportion that the Pre-Tax Deferrals bear to any Matching Employer Contributions for such year; and | ||
(4) | the Pre-Tax Deferrals subject to any Matching Employer Contributions on such Participants behalf for such Limitation Year shall then be reduced. |
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(c) | For the purposes of this Section, this Plan and all other defined contribution plans (as defined in Section 414(i) of the Code) maintained by the Employer or any Affiliate (whether or not terminated) shall be treated as one defined contribution plan. | ||
(d) | For purposes of this Section, a Participants Section 415 earnings means gross compensation actually paid or made available by all Employers and Affiliates and, prior to January 1, 1998, determined after giving effect to any Tax-Deferred Contributions under this Plan or any salary reduction arrangement under any cafeteria plan (within the meaning of Code Section 125). | ||
(e) | Prior to January 1, 2000, a Participant in this Plan who has at any time been a participant in a defined benefit plan maintained by the Employer or Affiliate, for any Limitation Year the sum of such Participants defined benefit plan fraction for such Limitation Year (as defined in paragraph (f) of this Section) and his defined contribution plan fraction for such Limitation Year (as defined in paragraph (f) of this Section) shall not exceed 1.0. In the event the sum of such fractions would exceed 1.0, such Participants retirement benefit under the defined benefit plan shall automatically be reduced by the amount required in order that the sum of such fractions not exceed 1.0. | ||
(f) | For the purposes of this Section: |
(1) | A Participants defined benefit plan fraction for any Limitation Year shall mean a fraction: (x) the numerator of which is the projected annual benefit under any defined benefit plan (as defined in Section 414(j) of the Code) maintained by the Employer or Affiliate for the Participant as of the end of the Limitation Year, and (y) the denominator of which is the lesser of (A) or (B): |
(A) | 125 percent of the dollar limitation in effect for such Limitation Year under Section 415(b)(1)(A ) of the Code. | ||
(B) | 140 percent of the compensation limitation that may be taken into account for such Limitation Year under Section 415(b)(1)( B) of the Code. |
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(2) | A Participants defined contribution plan fraction for any Limitation Year shall mean a fraction: (x) the numerator of which is the sum of all annual additions (as defined in Section 415(c) of the Code) under this Plan and any other defined contribution plan (as defined in Section 414(i) of the Code) maintained by the Employer or Affiliate for the Participant as of the end of the Limitation Year, and (y) the denominator of which is the lesser of (A) or (B), as determined for each Limitation Year of the Participants employment with the Employer or Affiliate: |
(A) | 125 percent of the dollar limitation in effect for such Limitation Year under Section 415(c)(1)(A) of the Code. | ||
(B) | 140 percent of the compensation limitation that may be taken into account for such Limitation Year under Section 415(c)(1)(B) of the Code. |
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(a) | By filing written notice with the Committee or its delegate, a Participant may elect to withdraw an amount equal to all, or a portion equal to at least $100, of the value of the aggregate balance of his sub-accounts attributable to his Rollover and/or After-Tax Contributions, if applicable. | ||
(b) | In the event a Participant has at least two sub-accounts attributable to any Rollover and/or After-Tax Contributions and he withdraws only a portion of the aggregate balance of such sub-accounts, the withdrawal shall be charged to each of the sub-accounts in the ratio that the balance of the sub-account as of the distribution date bears to the aggregate balance of all of his sub-accounts as of such date. |
(a) | Prior to his attainment of age 591/2, a Participant may not make an in-service withdrawal of amounts attributable to Tax-Deferred Contributions unless the Committee has made a determination that a hardship exists and such withdrawal is made in accordance with the provisions of the next Section. | ||
(b) | Alternatively, by filing written notice with the Committee, a Participant who has attained the age of 591/2 may elect to withdraw an amount equal to all, or a portion equal to at least $100, of the value of the aggregate balance of his sub-accounts attributable to his Tax-Deferred Contributions. |
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(c) | In the event a Participant has at least two sub-accounts attributable to Tax-Deferred Contributions and he withdraws only a portion of the aggregate balance of such sub-accounts, the withdrawal shall be charged to each of the sub-accounts in the ratio that the balance of the sub-account as of the distribution date bears to the aggregate balance of all of his sub-accounts as of such date. |
(a) | Any Participant may request a hardship withdrawal of all or a portion of his vested account balance in any Account. The request shall specify the amount of withdrawal requested and shall include such evidence documenting the hardship, as is requested by the Committee. Such withdrawal may be made only with the consent of the Committee. For the purpose of this Article, a withdrawal is on account of hardship only: |
(1) | if the distribution is made on account of an immediate and heavy financial need of the Participant, and | ||
(2) | is necessary to satisfy such financial need. |
(b) | A withdrawal will be deemed to be made on account of an immediate and heavy financial need if the withdrawal is on account of: |
(1) | unreimbursed, tax-deductible expenses for medical care previously incurred by the Participant, his spouse or dependents, or expenses necessary to obtain such past or future medical care; | ||
(2) | costs directly related to the purchase of a principal residence of the Participant (excluding mortgage payments); | ||
(3) | payment of tuition and related educational fees for the next 12 months of post-secondary education for the Participant, his spouse, children or dependents; |
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(4) | payments necessary to prevent the eviction of the Participant from his principal residence or foreclosure of the mortgage on the Participants principal residence; | ||
(5) | funeral expenses; or | ||
(6) | such other events as shall be determined by the Internal Revenue Service, or as determined within the sole discretion of the Committee. |
(c) | A withdrawal will not be treated as necessary to satisfy an immediate and heavy financial need of a Participant to the extent that the amount of the withdrawal is in excess of the amount required to relieve the financial need or to the extent such need may be satisfied from other resources reasonably available to the Participant, as shall be determined by the Committee in a uniform and non-discriminatory manner on the basis of all the relevant facts and circumstances. | ||
(d) | A distribution will be deemed necessary to satisfy an immediate and heavy financial need of the Participant if the Committee relies on the Participants written representation that the need cannot be relieved: |
(1) | through reimbursement or compensation by insurance or otherwise; | ||
(2) | by reasonable liquidation of the Participants assets (or those of his spouse or minor children) to the extent such liquidation does not create a financial hardship; | ||
(3) | by the Participants cessation of elective and voluntary contributions under the Plan; | ||
(4) | by the Participant making other withdrawals or nontaxable loans from all plans in which he participates; or | ||
(5) | by borrowing from commercial sources on reasonable commercial terms. |
(e) | Any hardship withdrawal shall be taken from the Participants several Accounts, in a particular order that shall be determined by the Committee. |
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(a) | In the case of an in-service withdrawal under this Article, the amount withdrawn will be paid to the Participant in a lump sum in cash as soon as practicable after the ast day of the month in which the Participant gives notice of such withdrawal to the Committee or its delegate. | ||
(b) | In the case of a hardship withdrawal under this Article, the amount withdrawn will be paid to the Participant in a lump sum in cash as soon as practicable following the date on which the Committee approves the withdrawal. |
(a) | Upon the application of any Participant and approval thereof by the Committee in accordance with uniform and non-discriminatory policies, the Committee shall direct the Trustee to make a loan to such Participant. The maximum amount of any such loan shall be the lesser of (i) $50,000 reduced by the highest outstanding balance of any loan from the Plan during the one-year period ending on the day before the date on which such loan is made or (ii) 50% of the value of his Accounts under the Plan in which he is vested. |
(b) | Any loan pursuant to paragraph (a) of this Section will be made from the Participants Account, in the order prescribed by the Committee, and charged against the Funds in which the Accounts from which the loan is made are invested, as shall be designated by the Participant, subject to such restrictions and limitations as shall be established by the Committee as to any such Fund. Immediately upon being made, the Participants Account balances shall be reduced, to reflect the outstanding loan balance. All |
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repayments of principal and interest on the Participants note shall be invested in the Fund(s) in accordance with the general rules of Article VI. | |||
(c) | The note for any loan under paragraph (a) of this Section shall bear interest at a reasonable fixed rate as shall be determined by the Committee; provided, however, that such rate shall not exceed the maximum rate permitted by law. Principal and interest under any such loan shall be repaid by any Participant who is an active Employee through payroll deductions; provided, however, that the Participant may prepay the entire unpaid principal and accrued interest on any loan at any time. The term of the note and loan must be a number of complete years; it cannot include any fractional part of a year. The term of such note shall not be for a period longer than four years (five years for loans made on or after April 4, 2001); provided, however, that such term may be up to nine years (ten years for loans made on or after April 4, 2001) if the proceeds of such loan are used to acquire the Participants principal residence. | ||
(d) | Any loan to a Participant shall be secured by such Participants vested interest in his Accounts hereunder. As a condition of any such loan, the Participant shall consent to such security interest. Upon the Participants termination of participation prior to the maturity of any outstanding loan, the unpaid principal and accrued interest shall immediately become due and payable. Following a Participants termination of participation, in the event he does not repay the unpaid principal and accrued interest on any outstanding loan prior to the distribution of his benefits under Article X, then as required by the Code and ERISA, the Committee may make a deemed, taxable distribution to the former Participant of his unpaid loan balance. Further, the Plans final such distribution to the Participant or Beneficiary shall consist of such Participants note (including any claim to principal and accrued interest due thereunder) and the remaining amount credited to such Participants Accounts, which distribution shall constitute full payment of all benefits to which such Participant or Beneficiary is entitled under the Plan. | ||
(e) | Each Participant to whom such loan is made shall receive a clear statement of any administrative charges involved in such loan. This statement shall include the dollar amount and annual interest rate of the finance charge. |
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(a) | Installments. A Participant can elect payment of his benefit in monthly, quarterly or annual installments. Notwithstanding the foregoing, the Participant may change or increase the amount of his installment distribution at any time upon reasonable notice to the Committee. | ||
(b) | Other Requirements. Installment distributions shall comply with Code Section 401(a)(9) and the regulations thereunder, which are hereby incorporated by reference. | ||
(c) | Minimum Distribution Requirements. With respect to distributions under the Plan made in calendar years beginning on or after January 1, 2001, the Plan will apply the minimum distribution requirements of Code Section 401(a)(9) in accordance with the regulations under Code Section 401(a)(9) that were proposed in January 2001, notwithstanding any provision to the contrary. This amendment shall continue in effect until the end of the last calendar year beginning before the effective date of final regulations under Code Section 401(a)(9) or such other date specified in guidance published by the Internal Revenue Service. |
(a) | Payment of small amounts. Notwithstanding any other provision of the Plan, if the value of a Participants vested Account balances under the Plan does not exceed $5,000, distribution shall be automatically made as soon as administratively practicable in a lump sum. | ||
(b) | Time of Commencement of Benefits. Subject to Section 10.3(c) and (d), distribution to a Participant under this Plan shall be made or commence no later than whichever of dates specified in paragraphs (1) or (2) below is earlier: |
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(1) | except as the Participant may otherwise elect, the 60th day after the close of the Plan Year in which the later of the following events occurs: |
(A) | the Participants termination of employment or | ||
(B) | the Participants attainment of his Normal Retirement Date, and |
(2) | if the Participant is a 5%-Owner, the first day of April following the calendar year in which the Participant attains age 70-1/2. Distribution shall be made as though the Participant had retired. Any contribution or forfeiture subsequently allocable to the Participants accounts shall be distributed to the Participant as soon as practicable following the date of such allocation (or, in the event the Participant is still employed, as soon as practicable after the end of the Plan Year in respect of which the contribution or forfeiture is made). |
(c) | Transition Rule. A Participant who attains age 70-1/2 and is not described in Section 10.3(b)(2), may elect to receive a distribution of his Accounts (as though he had terminated employment) upon suitable notice to the Committee. | ||
(d) | Delay of Distribution. Notwithstanding any provisions to the contrary contained in this Plan, in the event that the amount of a distribution required to commence on the date otherwise determined under this Plan cannot be ascertained by such date, or if it is not possible to make such distribution on such date because the Committee has been unable to locate the Participant (or in the case of a deceased Participant, his Beneficiary) after making reasonable efforts to do so, distribution retroactive to such date may be made 60 days after the earliest date on which the amount of such distribution can be ascertained under this Plan or the date on which the Participant or Beneficiary is located, whichever is applicable. |
(a) | Payment to Beneficiary. If a Participant who is eligible to receive payment of his Plan benefit under this Article, dies before payment is either begun or completed, then the unpaid remainder of his vested Account balances shall be paid to his Beneficiary in a lump sum. No optional forms of benefit are available. Payments shall be made as soon as is practicable, following the Committees receipt of an appropriate notice of the Participants death, under Plan procedures. |
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(a) | General Rules. A Distributee (as defined in this Section) may elect, under Plan procedures, to have all or any portion of his proper Plan distribution transferred in a rollover transfer from the Trust Fund to another qualified plan, certain IRAs and certain other vehicles, subject to the restrictions of this Section. | ||
(b) | Definition of Distributee. For the purposes of this Section only, a Distributee is a Participant, former Participant, surviving spouse, or alternate payee (as defined by Code Section 414(p)), who is eligible under the Plan and Plan procedures to receive any Plan distribution. Distributees shall not include any other Beneficiary. | ||
(c) | Limits on Distribution Eligible for Direct Rollover. Generally, all or any portion of the accrued, vested Account balance attributable to the Distributee would be eligible for a rollover under this Section, provided that the amount is includible in gross income. However, the following distributions are not eligible: |
(1) | periodic payments paid out over the life or life expectancy of the Distributee; | ||
(2) | equal installment payments scheduled to be made over ten or more years; | ||
(3) | all of any distribution paid to any Distributee during or after the year that the Participant reaches, or would have reached, age 701/2; | ||
(4) | the portion of any distribution that is required to be paid under Code Section 401(a)(9); | ||
(5) | hardship distributions paid on or after January 1, 2000; | ||
(6) | corrective distributions; | ||
(7) | amounts loaned from the Plan, to the extent that the loan satisfies Code Section 72(p); or | ||
(8) | any portion of an unpaid loan balance, that has been offset from the Participants Account. |
(d) | Limits on recipient plans and IRAs. A rollover transfer from the Trust Fund under this Section can be made only to the trustee or custodian of one of the following eligible |
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retirement plans listed below, provided that the transfer is made under Plan procedures, and that the trustee or custodian accepts the rollover. However, only one rollover can be made with respect to any single distribution. Such eligible retirement plans are: |
(1) | a qualified, employer defined contribution plan; | ||
(2) | an individual retirement account or IRA, which holds or which will hold only amounts attributable to qualified employer plans, as described by Code Section 408(d)(3); | ||
(3) | an individual retirement annuity described in Code Section 408(b); or | ||
(4) | an annuity plan described in Code Section 403(a). |
(e) | Limits on direct rollovers made by surviving spouses. Distributees who are surviving spouses, but who are not alternate payees as described by Code Section 414(p), will be able to elect a rollover transfer only to an IRA or an individual retirement annuity, subject to all of the preceding rules of this Section. |
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(a) | The Committee has complete discretionary and final authority to (1) determine all questions concerning elections, contributions, and benefits under the Plan, (2) construe all terms under the Plan, including any uncertain terms, and (3) set Plan procedures and determine all questions concerning Plan administration. All administrative decisions made by the Committee, and all its interpretations of the Plan documents, shall be given full deference by any court of law. | ||
(b) | Each member of the Committee may delegate Committee responsibilities among the Employer directors, officers, or employees, and may consult with or hire outside experts. The expenses of such experts shall be paid by the Plan, to the extent that they are not paid by an Employer. | ||
(c) | Employees of the Employer who are human resources personnel, or benefits representatives shall, under the authority of the Committee, perform the routine |
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administration of the Plan, such as distributing and collecting forms and providing information about Plan procedures. However, information that concerns an interpretation of the Plan or a discretionary determination, can be properly provided only by the Committee. | |||
(d) | Should any individual receive oral or written information concerning the Plan, which is contradicted by a subsequent determination by the Committee, then the Committees final determination shall control. | ||
(e) | The Committee shall have the authority to limit the contributions of Highly Compensated Employees. |
(a) | The Committee shall determine Participants and Beneficiaries rights to benefits under the Plan. In the event that a Participant or Beneficiary disputes an initial determination made by the Committee, then he may dispute the determination only by filing a written claim for benefits. | ||
(b) | If a claim is wholly or partially denied, the Committee shall provide the claimant with a notice of denial, written in a manner calculated to be understood by the claimant and setting forth: |
(1) | The specific reason(s) for such denial; | ||
(2) | Specific references to the pertinent Plan provisions on which the denial is based; | ||
(3) | A description of any additional material or information necessary for the claimant to perfect the claim with an explanation of why such material or information is necessary; and | ||
(4) | Appropriate information as to the steps to be taken if the claimant |
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wishes to submit his or her claim for review. | |||
(5) | The notice of denial shall be given within a reasonable time period but no later than 90 days after the claim is received, unless special circumstances require an extension of time for processing the claim. If such extension is required, written notice shall be furnished to the claimant within 90 days of the date the claim was received stating that an extension of time and the date by which a decision on the claim can be expected, which shall be no more than 180 days from the date the claim was filed. | ||
(6) | If no written notice of denial is provided by the Committee, then the claim shall be deemed to be denied, and the claimant may appeal the claim as though the claim had been denied. |
(c) | The claimant and/or his representative may appeal the denied claim and may: |
(1) | Request a review by making a written request to the Committee provided that such a request is made within 65 days of the date of the notification of the denied claim; | ||
(2) | Review pertinent documents. |
(d) | Upon receipt of a request for review, the Committee shall within a reasonable time period but not later than 60 days after receiving the request, provide written notification of its decision to the claimant stating the specific reasons and referencing specific plan provisions on which its decision is based, unless special circumstances require an extension for processing the review. If such an extension is required, the Committee shall notify the claimant of the date, no later than 120 days after the original date the request for review was received, on which the Committee will notify the claimant of its decision. | ||
(e) | In the event of any dispute over benefits under this Plan, all remedies available to the disputing individual under this Article must be exhausted before legal recourse of any type is sought. |
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(a) | The Company reserves the right to amend, suspend, freeze, or terminate this Plan to any extent and in any manner that it may deem advisable (subject only to collective bargaining agreements), by action of the Board. An amendment, suspension, or termination may be made retroactively, if appropriate under the Code, ERISA, or the intention that this Plan be qualified under Code Sections 401(a), 401(k), and 501(a). The Company, all Participants, their Beneficiaries and all other persons having any interest hereunder shall be bound by any such amendment; provided, however, that no amendment shall: |
(1) | Change the duties or liabilities of the Trustee without its written assent to such amendment; or | ||
(2) | Adversely affect or reduce the then accrued benefits of any Participants, as prescribed by the Code. |
(b) | Notwithstanding any contrary provisions in the preceding paragraph, the Committee may make changes in the Plan procedures without formal Plan amendment. Further, the Committee and the Employer may make certain other changes, in the Plan without formal Plan amendment, as specified in the Plan. |
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(a) | Upon the effective date determined by the Board; or | ||
(b) | Upon the earlier of (1) the complete accomplishment of all purposes for which the Plan was created, or (2) the death of the last person entitled to receive any benefits hereunder. |
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(a) | Except as provided in paragraphs (b), (c), and (d) of this Section, no part of the Trust Fund may be used for, or diverted to, purposes other than the exclusive benefit of the |
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Participants in the Plan or their Beneficiaries prior to the satisfaction of all liabilities with respect to the Participants and their Beneficiaries. | |||
(b) | In the case of contributions made by the Employer prior to the receipt of an initial favorable determination letter from the Internal Revenue Service with respect to the Plan, the Employer may direct the Trustee to return to the Employer those contributions and all earnings thereon within one year after the Internal Revenue Service refuses in writing to issue such a letter. | ||
(c) | In the case of any portion of a contribution made by the Employer by a mistake of fact, the Employer may direct the Trustee to return to the Employer that portion of the contribution within one year after the payment of that portion of the contribution. | ||
(d) | In the case of any portion of a contribution made by the Employer and disallowed by the Internal Revenue Service as a deduction under section 404 of the Code, the Employer may direct the Trustee to return to the Employer that portion of the contribution within one year after the Internal Revenue Service disallows the deduction in writing. | ||
(e) | Earnings attributable to the contributions returnable under paragraphs (c) or (d) shall not be returned to the Employer, and any losses attributable to those contributions shall reduce the amount returned. |
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(a) | Service among Affiliates credited for vesting. Generally, Service performed for any Employer or Affiliate will be credited among all Affiliates for the purposes of vesting. Should a Plan Participant be transferred and become an Employee of an Affiliate, then he may be eligible to immediately become a participant in the new employers plan, provided that (1) he has sufficient Service under the new plans eligibility provisions and (2) he has submitted to the new plan all the proper forms by the appropriate deadline. | ||
(b) | Limits on deferrals. The Committee shall forward to any Affiliate a record of the year-to-date elective deferrals made by any Plan Participant who has transferred his employment to any Affiliate, in order to assure that the employee does not exceed any Code limit on elective deferrals. Similarly, the Committee shall request such a record with respect to any new Employee, who has transferred from an Affiliate. | ||
(c) | Vesting continues after transfer. Any Participant who transfers employment to an Affiliate shall not be treated as having terminated employment. His vesting under the Plan shall continue during his Service with the Affiliate, and he may not receive a distribution of his Accounts until his Service with any Employer and Affiliate ceases (or until his required beginning date under Section 10.4(c)). | ||
(d) | Accounts transferred only if fully vested. A Plan Participant who has transferred his employment to an Affiliate may transfer his Plan Accounts to another qualified Affiliate defined contribution plans only if he is fully vested in all his Accounts. Such a transfer of Accounts must be applied for, in writing, by the Participant, and must be approved of in writing by both affected plans. Any such transfer must include all of the Participants Accounts, and must be feasible for the recipient plan. If necessary, the |
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transfer shall be conditioned upon the Participants waiver of certain optional forms of payment provided under the transferring plan, but not offered by the recipient plan. | |||
(e) | Loans |
(1) | If a Participant has transferred his Plan Accounts under the preceding paragraph, any outstanding loan will be similarly transferred, conditioned on the approval of the recipient plan. Notwithstanding any contrary Plan provision, the repayment schedule of the Loan agreement may be amended, with the Participants approval, in order to accommodate the payroll practices of the new employer. Should it prove infeasible, within the discretionary determination of the recipient plans administrator, to effect this paragraph, then either (i) the transfer of Accounts shall not take place, or (ii) the loan shall become immediately due and payable (despite any contrary provision of the Plan or the loan agreement), or (iii) payroll deductions may be effected by the new employer, as described in the next paragraph. | ||
(2) | If a Participant has not transferred his Accounts to the plan of his new employer, then he shall generally pay off any outstanding Plan loan at the time of transfer. In lieu of this, he may arrange, conditioned upon the approval of his former and new employers, to have payroll deductions effected by his new employer and applied toward his Plan loan repayments. Failing either a transfer of Accounts or repayment of the loan, then the loan shall be in default, under the terms of the loan agreement. | ||
(3) | A Participant who has transferred his employment to an Affiliate, and not transferred his Accounts, may nevertheless take out a Plan loan, conditioned upon the approval of his new employer, and the new employers agreement to effect payroll deductions. |
(f) | Withdrawals. Withdrawals under the Plan will be fully permitted to any Participant who has transferred employment to an Affiliate, subject to the Plans rules for withdrawal. | ||
(g) | Transfer following a Break in Service. This Sub-section (g) concerns the situation of an individual who has worked for one Employer or Affiliate, terminates employment from that employer, but does not immediately transfer to a second Employer or Affiliate. Instead, this Sub-section (g) concerns those individuals who incur a period during |
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which they are not employed by an Employer or Affiliate, and then, subsequently, become employed by a second Employer or Affiliate. |
(1) | If such an individual (described in the introductory paragraph of this Sub-section (g)) does not incur a Break in Service prior to his employment with the second Employer or Affiliate (determined under the sole discretion of the administrator of the new employers plan under the terms of that plan), then the period of time preceding his employment with the second Employer or Affiliate (following his termination with the first Employer or Affiliate) shall be credited for the purpose of vesting. | ||
(2) | If such an individual has incurred a Break in Service (determined under the sole discretion of the administrator of the new employers plan, under the terms of that plan) then the terms of the new employers plan shall govern how the individuals total service among all the Company Affiliates shall be credited, for the purposes of the new employers plan. | ||
(3) | If an individual described in this Sub-section (g) has incurred one or more Breaks in Service under the terms of his first employers plan, and has consequently lost the recognition of pre-Break in Service under the first employers plan, then any provisions in the first employers plan regarding (i) repayment of distributed amounts back into the first employers plan, within five years of rehire by the second Employer or Affiliate in order to have forfeited amounts restored by the first employers plan and pre-Break Service recognized by both plans and (ii) completing one Year of Service with the new employer in order to have forfeited amounts restored under the former employers plan and pre-Break Service recognized by both plans must be acknowledged and effected by the administrator of the new employers plan, as if these provisions in the first employers plan were fully a part of the new employers plan. It will therefore be necessary for the administrators of the two plans to share information concerning the individual. |
(a) | Except as provided in the next section or under Code Section 401(a)(13), no Plan benefit, whether vested or not, of any Participant or former Participant, shall be subject to alienation, assignment, pledging, encumbrance, attachment, garnishment; including |
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but not limited to execution, sequestration, or other legal or equitable process, or transferability by operation of law in the event of bankruptcy, insolvency or otherwise. |
(a) | The provisions of the preceding Section above shall not prevent the creation, assignment or recognition of any individuals right to a benefit payable with respect to a Participant pursuant to a Qualified Domestic Relations Order (QDRO) or any appropriate domestic relations order entered before January 1, 1985. | ||
(b) | Qualified Domestic Relations Order or QDRO shall mean any judgment, decree or order which (1) meets the basic requirements of Code Section 414(p) and further (2) meets the QDRO requirements set out in the Plan procedures, concerning domestic relations orders, as determined by the final, discretionary authority of The Committee. | ||
(c) | The Committee shall establish reasonable procedures to determine whether a domestic relations order is a QDRO and to administer distributions under a QDRO. If any domestic relations order is received by the Plan, the Committee shall (1) promptly notify the Participant and any Alternate Payee that the order has been received and of the Plans procedures for determining whether the order is a QDRO and (2) notify the Participant and each Alternate Payee (or their representatives) of the Committees determination. | ||
(d) | Should any court order be issued after a Participants or Alternate Payees death, it will be considered a QDRO only if it (1) relates to and reflects an earlier order issued before death, and (2) meets the QDRO requirements. | ||
(e) | The Committee shall have final, discretionary authority to administer and interpret any QDRO, including any uncertain terms. |
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(a) | In the event the Committee determines in its discretion that any Participant or Beneficiary, receiving or entitled to receive benefits under the Plan is incompetent to care for his affairs, and in the absence of the appointment of a legal guardian of the property of the incompetent, benefit payments due under the Plan (unless prior claim thereto has been made by a duly qualified guardian, committee or other legal representative) may be made to the spouse, parent, brother or sister or other person, including a hospital or other institution, deemed by the Committee to have incurred or to be liable for expenses on behalf of such incompetent | ||
(b) | In the absence of the appointment of a legal guardian of the property of a minor, any minors share of benefits payable under the Plan may be paid to such adult or adults as in the discretionary opinion of the Committee have assumed the custody and principal support of such minor. | ||
(c) | The Committee, however, in its sole discretion, may require that a legal guardian for the property of any such incompetent or minor be appointed, before authorizing the payment of benefits in such situations. | ||
(d) | If the Committee is in doubt as to the right of any person to receive a Plan benefit, the Committee may direct the Trustee to retain such amount, without liability for any interest thereon, until the rights thereto are determined, or the Committee may direct the Trustee to pay such amount into any court of appropriate jurisdiction. The Trustee shall not be required to verify or insure that any distributions made to any third parties under this Section 13.22 are applied for the benefit of such minor or incompetent or incapacitated Beneficiary. |
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(a) | Generally, a Participant or former Participant must give written consent to the distribution of any Plan benefit exceeding $5,000 (or, any greater amount determined by the Treasury Department under Code Section 411(a)(11)) paid before his Normal Retirement Date (even if the Participant has a Disability). Further, such distributees must receive notice, no less than 30 days and no more than 90 days before their payment date, of their right to defer payment of the Plan benefit. | ||
(b) | Notwithstanding the preceding paragraph, if a distribution under this Plan is not subject to Code Sections 401(a)(11) and 417, then Plan distributions described in the preceding paragraph may be made less than 30 days after the Participant has received the notice, described in the preceding paragraph, provided that: |
(1) | The Committee clearly notifies the Participant of his right to delay receipt of his distribution for 30 days after he received notice under this Section, during which he may consider whether or not to elect the distribution (and any applicable, optional form of benefit), and | ||
(2) | the Participant, after receiving notice under this Section, elects to either receive the distribution or to make or not to make a rollover transfer under Section 10.7. |
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(a) | An officer of an Employer or an Affiliate having Total Compensation of more than fifty percent (50%) of the dollar amount in effect under Codes Sections 415(b)(1)(A) and (d) for any such Plan Year; provided, that the number of employees treated as officers shall be no more than fifty (50) or, if fewer, the greater of three (3) employees or ten percent (10%) of the employees (exclusive of employees described in section 414(q)(8) of the Code); | ||
(b) | One of the ten (10) employees (i) having Compensation of more than the dollar limit under section 415(c)(1)(A) of the Code, and (ii) owning or considered as owning (within the meaning of section 416(i) of the Code) the largest percentage interests in value of an Employer or an Affiliate, provided that such percentage interest exceeds one-half percent (.5%) in value. If two employees have the same interest in the Employer or an Affiliate, the employee having the greater Top-Heavy Compensation shall be treated as having a larger interest. | ||
(c) | A 5%-Owner. | ||
(d) | A one percent (1%) owner of an Employer or an Affiliate having Top-Heavy Compensation of more than one hundred fifty thousand dollars ($150,000). One percent (1%) owner means any person who would be described in the definition of 5%-Owner if one percent (1%) were substituted for five percent (5%) in each place where it appears. |
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(1) | if the Top-Heavy Ratio for this Plan exceeds 60 percent and this Plan is not part of any Required Aggregation Group of Plans or Permissive Aggregation Group of Plans; | ||
(2) | if this Plan is a part of a Required Aggregation Group of Plans (but is not part of a Permissive Aggregation Group of Plans) and the Top-Heavy Ratio for the Required Aggregation Group of Plans exceeds 60 percent; or | ||
(3) | if this Plan is a part of a Required Aggregation Group of Plans and part of a Permissive Aggregation Group of Plans and the Top-Heavy Ratio for the Permissive Aggregation Group of Plans exceeds 60 percent. |
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(a) | The minimum allocation provided for in the preceding Section shall not apply to any Participant who was not an Employee on the last day of the applicable Plan Year. | ||
(b) | The minimum allocation provided for in the preceding Section shall not apply to any Participant to the extent such Participant is covered under any other plan or plans of the |
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Employer and under the terms of such other plan or plans, the minimum allocation of Employer contributions and/or accrual of retirement benefits applicable to a Top-Heavy Plan are provided for. |
Completed | ||
Years of Vesting Service | Nonforfeitable Interest | |
Less than 3 3 or more | 0% 100% |
K&F INDUSTRIES INC. | ||||||
By: | Kenneth M. Schwartz | |||||
Kenneth M. Schwartz | ||||||
Title: | President and Chief Operating Officer |
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