THE STANLEY RETIREMENT PLAN
Effective Date
November 28, 1979
As Amended and Restated
January 1, 1989
Adopted
April 20, 1995
INTRODUCTION
On November 28, 1979, Stanley Interiors Corporation acquired, among
other assets, substantially all of the assets of the Stanley Furniture
Company Division of The Mead Corporation. In connection with the
acquisition, Stanley Interiors Corporation adopted, effective November 28,
1979, the provisions of the Stanley Retirement Plan insofar as they applied
to employees of the Stanley Furniture Company Division who were participants
in the Stanley Retirement Plan and who became employees of Stanley Interiors
Corporation, with the intention of continuing the Stanley Retirement Plan for
such employees. Effective November 9, 1992, Stanley Interiors Corporation
became known as Stanley Furniture Company, Inc.
The Stanley Retirement Plan was subsequently amended from time to time
with the most recent amendment and restatement being effective January 1,
1985.
Effective December 31, 1993, Stanley Furniture Company, Inc. intends to
merge the assets and liabilities of the Pension Plan of R. W. Norman Division
of Stanley Interiors Corporation (the "Norman Plan") into the Stanley
Retirement Plan, with the participants of the Norman Plan becoming
participants of the Stanley Retirement Plan as of January 1, 1994.
The amended and restated Stanley Retirement Plan herein contained
constitutes an amendment, effective January 1, 1989, unless otherwise
indicated, to the earlier plan provisions, rather than a replacement of such
plan. The plan provisions as in effect immediately prior to this January 1,
1989 amendment and restatement, modified by Section 6.04 and Section 10.02 of
this amended and restated Plan, shall remain in effect for those Participants
who are not actively employed by the participating Employers at any time
after such date. The assets held under the Fund established pursuant to the
Stanley Retirement Plan shall continue to be held pursuant to the Stanley
Retirement Plan, as herein amended, as well as the assets merged into the
Fund from the Norman Plan.
The purpose of this Plan is to provide retirement security for eligible
Employees. It is intended that this Plan, together with the Fund established
to carry out the funding of the Plan, meet all the requirements of the
Internal Revenue Code of 1986 ("IRC"), as amended, and the Plan shall be
interpreted, wherever possible, to comply with the terms of the IRC
and all formal regulations and rulings issued under the IRC.
This Plan is amended and maintained under the condition that it shall
continue to be approved and qualified by the Internal Revenue Service under
IRC Section 401(a) and that the Trust hereunder continues to be exempt under
IRC Section 501(a), or under any comparable Sections of any future
legislation which amends, supplements or supersedes such Sections.
Effective January 1, 1989, unless otherwise indicated, the Stanley
Retirement Plan as amended and restated has the terms and provisions
hereinafter set forth.
ARTICLE I
DEFINITIONS
As used herein, unless otherwise required by the context, the following
words and phrases shall have the meanings indicated:
1.01 Accrued Benefit means:
1.01(a) For any Participant, who was not a participant in the Norman
Plan as of December 31, 1993, as of any date, the monthly retirement benefit
determined in accordance with Section 3.01 with Final Average Compensation,
Covered Compensation and Credited Service as of such date.
Notwithstanding any other contrary provision of the Plan,
effective January 4, 1989, in calculating the accrued benefit (including the
right to any optional benefit provided under the Plan) of any Participant,
such Participant shall accrue no additional benefit under the Plan on or
after January 4, 1989 to the extent that such additional benefit accrual
exceeds the benefit which would otherwise accrue in accordance with the
terms of the Plan as subsequently amended to comply with those qualification
requirements described in Income Tax Regulations Section
1.401(b)-1(b)(2)(ii).
This provision shall be effective until the last day of the
first Plan Year commencing in 1994 and shall be effective for such period if
and only if the subsequent Tax Reform Act of 1986 amendment is made on or
before the last day of the first Plan Year commencing in 1994.
In addition, the benefit accrued by any Participant during the
1989-1993 Plan Years shall in no event exceed the benefit accrual provided
during such Plan Years with respect to such Participant under the terms of
the Plan as subsequently amended to comply with the Tax Reform Act of 1986.
However, such Participant's accrued benefit shall not be less than what the
Participant had accrued as of the last day of the last Plan Year beginning
before January 1, 1989.
1.01(b) For any Participant who was a participant in the Norman Plan
as of December 31, 1993, and who is credited with an Hour of Service on or
after January 1, 1994, as of any subsequent date, the monthly retirement
benefit determined as the sum of (i) and (ii) below:
(i) The accrued benefit as of December 31, 1993, earned by
the Participant under the provisions of the Norman Plan in effect on December
31, 1993; and
(ii) The accrued benefit determined in accordance with Section
3.01 of this Plan for periods commencing on and after January 1, 1994, with
Final Average Compensation, Covered Compensation and Credited Service as of
such date.
1.02 Actuarial Equivalent means a benefit of equivalent value when computed
on the basis of the factors denoted in the Appendix to this Plan.
1.03 Administrative Committee means the Administrative Committee provided
for in Article VIII.
1.04 Affiliate means an organization which is a member of the same
controlled group of organizations [as defined in IRC Sections 414(b), (c),
(m) and (o)] as the Employer but which is not a participating Employer.
1.05 Annuity Starting Date means:
1.05(a) the first day of the first period for which an amount is
payable as an annuity, or
1.05(b) in the case of a benefit not payable in the form of an
annuity, the first day on which all events have occurred which entitle the
Participant to such benefit, or
1.05(c) the first day of the first period for which a benefit is to be
received by reason of Total and Permanent Disability.
1.06 Approved Absence means the absence of an Employee (a) authorized or
approved by his Employer, (b) while in the employ of an Affiliate pursuant to
transfer from an Employer, (c) during layoff or furlough while recall rights
continue (as determined in accordance with the normal practices of his
Employer), (d) who returns to employment within twelve (12) months of his
termination of service, or (e) who is on a Maternity or Paternity Absence.
Absence of an Employee due to service with the armed services of the
United States shall be deemed to be an Approved Absence expiring concurrently
with (i) reemployment or (ii) the expiration of any reemployment right
provided by law, whichever occurs earlier.
1.07 Beneficiary means any person designated by a Participant or otherwise
entitled to receive such benefits as may become payable under the provisions
of the Plan after the death of such Participant.
The designation of a Beneficiary shall be made on forms provided by
the Administrative Committee, and such forms shall be maintained in files
held by the Administrative Committee. A Participant may from time to time
change the Beneficiary by written notice to the Administrative Committee and,
upon such change, the rights of all previously designated Beneficiaries to
receive any benefits under the Plan shall cease. If, at the date of death of
the Participant, there is no valid and current Beneficiary designation on
file with the Administrative Committee, then any death benefits which would
have been payable to the Beneficiary shall be payable to the Participant's
surviving Spouse, if any; if none, to the Participant's children who survive
him, equally; or if none survive, then to the Participant's estate. The
interpretation of the Administrative Committee with respect to any
Beneficiary designation, subject to applicable law, shall be binding and
conclusive upon all parties and no person who claims to be a Beneficiary, or
any other person, shall have the right to question any action of the
Administrative Committee, which in the judgment of the Administrative
Committee fulfills the intent of the Participant who filed such designation.
If a Beneficiary designated by a Participant is not the Participant's
Spouse, then the Spouse's consent shall be required with respect to such
alternate Beneficiary for such designation to become effective and must be
limited to a benefit for a specfic alternate Beneficiary (or form of
benefits). Such consent shall be witnessed by a representative of
the Administrative Committee or a notary public. Any change in the
designation of an alternate Beneficiary shall also require the consent of the
Spouse for such change to become effective. The Administrative Committee may
accept an election other than that provided hereunder without the consent of
the Spouse if there is no Spouse, the Spouse cannot be located, or such other
circumstances as may be prescribed by regulations. Any spousal consent shall
only be applicable to the Spouse granting such consent.
1.08 Board means the board of directors of the Corporation.
1.09 Compensation means the amounts paid by an Employer to an Employee,
amounts paid by an Affiliate to a former Employee of an Employer now employed
by an Employer and amounts paid by an Affiliate to a current Employee prior
to his transfer to an Employer, for services, including amounts which the
Employee could have elected to receive as cash in the current year as taxable
income (a) prior to having such amount contributed to a plan which is
maintained pursuant to IRC Section 401(k) and/or (b) in lieu of a non-taxable
benefit under the Stanley Furniture Company, Inc. Flexible Benefit
Plan which is maintained pursuant to IRC Section 125, but excluding gifts,
credits, awards, payments under any incentive or bonus plan, except as
otherwise determined by the Administrative Committee, and any special payment
authorized by the Board.
For any Participant who was a participant in the Norman Plan as of
December 31, 1993, Compensation for any period prior to January 1, 1994,
shall be determined under the provisions of the Norman Plan.
Effective January 1, 1989, in no event shall Compensation as
hereinbefore determined exceed two hundred thousand dollars ($200,000) (or
such other legislated amount or such other adjusted amount as determined by
the Secretary of Treasury) pursuant to IRC Section 401(a)(17), provided that
the increase determined as of January 1 of a calendar year by the Secretary
of Treasury shall be effective for Plan Years beginning in such calendar year
and retroactive to prior years. In determining the Compensation of an
Employee for purposes of this limit, the rules of IRC Section 414(q)(6) shall
apply, except in applying such rules, the term "family" shall include only
the spouse of the Employee and any lineal descendants of the Employee who
have not attained age nineteen (19) before the close of the year. If, as a
result of the application of such rules, the adjusted dollar limit is
exceeded, then the limitation shall be prorated among the affected
individuals in proportion to each such individual's Compensation as
determined under this Section prior to the application of the limit.
Effective January 1, 1994, the two hundred thousand dollar ($200,000)
limit contained above will be one hundred fifty thousand dollars ($150,000),
except that increases shall not apply to prior years.
Compensation of an Employee who is at any time simultaneously in the
employ of more than one Employer shall be the sum of such earnings received
by the Employee from
all such Employers.
1.10 Compensation and Benefits Committee means the Stanley Furniture
Compensation and Benefits Committee provided for in Article VIII.
1.11 Contributions means the payments as provided herein by the Employer to
the Fund.
1.12 Corporation means Stanley Furniture Company, Inc. (formerly known as
Stanley Interiors Corporation), a Delaware corporation, or any successor
thereto. The Corporation is the sponsor, the named Fiduciary and the
administrator of the Plan for purposes of ERISA as it relates to the
employees of each Employer.
1.13 Covered Compensation means, effective January 1, 1994, for any
Participant, the unindexed average, of the Taxable Wage Bases in effect for
each calendar year during the thirty-five (35) year period ending with the
last day of the calendar year in which the Participant attains (or will
attain) Social Security Retirement Age. In determining a Participant's
Covered Compensation for a Plan Year, the Taxable Wage Base for all
calendar years beginning after the first day of the Plan Year is assumed to
be the same as the Taxable Wage Base in effect as of the first day of the
Plan Year in which the determination is made. A Participant's Covered
Compensation for any Plan Year after the thirty-five (35) year period
described herein shall be the Participant's Covered Compensation for the Plan
Year during which the thirty-five (35) years period ends. A Participant's
Covered Compensation for a Plan Year before the thirty-five (35) year period
described herein shall be the Taxable Wage Base in effect as of the first day
of the Plan Year. A Participant's Covered Compensation shall be adjusted
automaticall each Plan Year to reflect changes in the Taxable Wage Base.
For purposes of determining the amount of a Participant's Covered
Compensation under this Section 1.13, the Plan shall use tables published by
the Internal Revenue Service for rounding the actual amounts of Covered
Compensation for different years of birth.
1.14 Credited Service means the period of time determined in accordance
with Sections 1.14(a) and 1.14(b), subject to Sections 1.14(c), 1.14(d),
1.14(e), 1.14(f), 1.14(g) and 1.14(h) below.
1.14(a) For Periods Prior to January 1, 1993 - Credited Service shall be
the total number of years and completed months of Past Service and Future
Service through December 31, 1992.
(i) Past Service shall be the continuous employment of a
Participant prior to the Effective Date of the Plan, less any period of
Service required for eligibility applicable to the Participant. No Past
Service shall be credited to any Employee who voluntarily failed to
participate (or waived his participation) in this Plan or a Pre-existing
Plan.
(ii) Future Service for periods commencing on January 1, 1976,
through December 31, 1992, shall be the continuous employment of an Employee
after he becomes eligible for participation in the Plan.
1.14(b) For Periods Commencing on and After January 1, 1993 - For
periods commencing on and after January 1, 1993, Credited Service shall be
the total number of Plan Years in which an Employee completes one thousand
(1,000) or more Hours of Service, after the date on which he becomes eligible
for participation in the Plan.
Credited Service shall not include any period of service with the
Employer or an Affiliate which occurred on or after June 1, 1988, during
which neither the Plan nor a Pre-existing Plan was maintained.
1.14(c) For purposes of this Plan, Credited Service shall be
preserved during an Employee's Approved Absence, but no Credited Service
shall be granted for any complete calendar year which occurs after the
applicable Effective Date and during which an Employee was on an Approved
Absence and received no Compensation; provided however, that an Employee will
receive Credited Service while on Approved Absence due to service in the
armed forces of the United States. An Employee who transfers employment to
that of an Affiliate shall have his Credited Service preserved only to the
extent that it does not result in any duplicate coverage, as determined by
the Administrative Committee.
1.14(d) For periods prior to January 1, 1993, upon the reemployment
by an Employer or Affiliate of a Participant who terminated employment
without any vested benefit, the Participant shall receive Credited Service
(a) for continuous employment prior to his termination, if the period of his
break in employment is equal to or less than the greater of five (5) years or
the period of employment prior to the break (provided that the Participant
completes one (1) year of Service after a one (1) year or longer break
in employment), or (b) for the period of the break in employment, if the
Participant is reemployed within the twelve (12) month period subsequent to
the date of his termination of employment.
1.14(e) For periods commencing on and after January 1, 1993, upon
reemployment by an Employer or an Affiliate of a Participant who terminated
employment without any vested benefit, the Participant shall receive Credited
Service in accordance with Sections 1.14(a) and (b) for continuous employment
prior to his termination, if the number of his One Year Breaks in Service,
when added to the period of his break in employment prior to January 1, 1993,
if applicable, are equal to or less than the greater of five (5) years or the
period of employment prior to the break (provided that the Participant
completes one (1) Year of Service after incurring one (1) or more One Year
Breaks in Service).
Upon the reemployment of a Participant who had terminated with a
deferred vested benefit, the Participant shall receive Credited Service for
any year in which he had Compensation.
1.14(f) Special Rule for Former Employees of the Raleigh Road
Furniture Corporation - For Participants who were employees the Raleigh Road
Furniture Corporation on December 31, 1986, Credited Service shall include
service with such company after December 31, 1985, for purposes of
determining benefit accruals only.
1.14(g) Special Rule for Former Participants in the Norman Plan - For
Participants who participated in the Norman Plan, Credited Service for
purposes of determining the Participant's Accrued Benefit shall include all
years of Credited Service credited prior to January 1, 1994, under the Norman
Plan. Past Credited Service for Employees not participating in the Norman
Plan shall be determined commencing on the date the Employer became a member
of the Corporation's controlled group of corporations.
1.14(h) Any Employee who was excluded from participation in the Plan
for periods prior to January 1, 1988, because he had attained age sixty (60)
at his initial employment date and who completes an Hour of Service on or
after January 1, 1988, shall receive Credited Service in accordance with the
provisions of this Section 1.14.
1.15 Defined Benefit Plan means a plan established and qualified under IRC
Section 401 or 403, except to the extent it is, or is treated as, a Defined
Contribution Plan.
1.16 Defined Contribution Plan means a plan established and qualified under
IRC Section 401 or 403 which provides for an individual account for each
participant therein and for benefits based solely on the amount contributed
to each participant's account and any income and expenses or gains or losses
(both realized and unrealized) which may be allocated to such accounts.
1.17 Delayed Retirement Date means the first day of any month coinciding
with or next following the actual date the Participant severs his employment
with the Employer after his Normal Retirement Date.
1.18 Disability Retirement Date means the first day of any month prior to
a Participant's Normal Retirement Date which coincides with or next follows
a determination by the Administrative Committee that the Participant is
Totally and Permanently Disabled.
1.19 Early Retirement Date means the first day of any month prior to a
Participant's Normal Retirement Date; provided, that the Participant has
attained age fifty-five (55) and completed at least ten (10) years of Service
with any Employers subject to this Plan. A Participant may elect early
retirement by providing written notice to the Administrative Committee at
least thirty (30) days in advance.
1.20 Effective Date means January 1, 1976, or such later date as of which
an Employer shall have adopted the Plan for its Employees. The Effective
Date of this amendment and restatement shall be January 1, 1989.
1.21 Employee means any person employed by the Employer, as determined
under the Employer's normal practices, but excluding:
1.21(a) any person earning service for benefits under another
Company-sponsored retirement plan and is a member of a collective bargaining
unit;
1.21(b) any former Employee of an Employer who has been transferred
to the employment of an Affiliate, unless the transferred person waives his
rights to future service benefits under the Plan;
1.21(c) any person who is on Approved Absence and who was such an
employee immediately prior to such Approved Absence;
1.21(d) any person who is considered a leased employee within the
definition of IRC Section 414(n); and
1.21(e) any person who is employed as an Outlet Store Sales Clerk.
A leased employee is any person other than an employee of the Employer
who pursuant to an agreement between the Employer and any other person
(leasing organization) has performed services for the Employer or for the
Employer and related persons, determined in accordance with IRC Section
414(n)(6), on a substantially full time basis for a period of at least one
(1) year, and such services are of a type historically performed by employees
in the business field of the Employer. Contributions or benefits provided a
leased employee by the leasing organization which are attributable to
services performed for the Employer shall be treated as provided by the
Employer.
1.22 Employer means, collectively or individually as the context may
indicate, the Corporation and any other organization which (a) is a member of
the same controlled group of organizations as the Corporation as determined
pursuant to IRC Sections 414(b), (c), (m) and (o), (b) the Compensation and
Benefits Committee shall have authorized to adopt the Plan, and (c) by taking
appropriate action shall have adopted the Plan and become signatory to the
Trust Agreement; or any successor to one or more of such entities.
1.23 ERISA means the Employee Retirement Income Security Act of 1974, as
amended from time to time.
1.24 Fiduciary means the Corporation, Employer, Trustee, Administrative
Committee, Compensation and Benefits Committee, Investment Policy Committee
and any individual, corporation, firm or other entity which assumes in
accordance with Article VIII responsibilities of the Corporation, Employer,
Trustee, Administrative Committee, Compensation and Benefits Committee, or
Investment Policy Committee respecting management of the Plan or the
disposition of its assets.
1.25 Final Average Compensation means the average annual Compensation of a
Participant from January 1, 1987, through the date of his retirement from
continuous employment with an Employer or Affiliate. For Participants who
participated in the Norman Plan, Final Average Compensation means the average
annual Compensation ofsuch Participant from January 1, 1992, through the date
of his retirement from continuous employment with an Employer or Affiliate.
If a Participant retires with less than five (5)years of such annual
Compensation, Compensation for years immediately prior to January 1, 1987,
shall be considered to the extent necessary to bring the Participant's total
years of Compensation used in the average calculation to five (5). Effective
January 1, 1993, and notwithstanding anything contained herein to the
contrary, if a Participant's Compensation in the year of his retirement or
termination would increase such average but for the fact that a full year of
employment had not been completed, such Compensation shall be included in the
average.
1.26 Fund means the trust fund created in accordance with Article VII.
1.27 Highly Compensated Employee means:
1.27(a) Any employee who during the Plan Year or preceding twelve
(12) month period meets one of the following criteria --
(i) was at any time a Five Percent (5%) Owner of the Employer or
Affiliate;
(ii) received maximum Compensation from the Employer or Affiliate
in excess of seventy-five thousand dollars ($75,000) (or such larger amount
as may be determined by the Secretary of the Treasury);
(iii) received Maximum Compensation from the Employer or Affiliate
in excess of fifty thousand dollars ($50,000) (or such larger amount as may
be determined by the Secretary of the Treasury) and was in the top-paid group
consisting of the top twenty percent (20%) of the employees (considering all
employees of the Employer or Affiliate) when ranked on the basis of Maximum
Compensation during such Plan Year; or
(iv) was at any time an officer and received Maximum Compensation
greater than fifty percent (50%) of the amount in effect under IRC Section
415(b)(1)(A) for such Plan Year. If, for any Plan Year, no officer of the
Employer or Affiliate is identified pursuant to this Section, the highest
paid employee of the Employer or Affiliate for such Plan Year shall be
treated as Highly Compensated Employee. No more than fifty (50) employees
or, if lesser, the greater of three (3) employees or ten percent (10%) of
employees, shall be treated as officers.
An employee shall be considered a Highly Compensated Employee for
purposes of Section 1.27(a)(i) if he was a Five Percent (5%) Owner of the
Employer or Affiliate in the Plan Year of determination or the preceding Plan
Year. An employee shall not be considered a Highly Compensated Employee for
purposes of Sections 1.27(a)(ii), 1.27(a)(iii) and 1.27(a)(iv) if he was a
Highly Compensated Employee in the current Plan Year but was not a Highly
Compensated Employee in the preceding Plan Year unless such employee is a
member of the group consisting of the one hundred (100) employees paid the
greatest Maximum Compensation by the Employer or an Affiliate during the Plan
Year for which such determination is being made.
If an employee is a Family Member of another employee who is (i) a
Five Percent (5%) Owner of the Employer or Affiliate, or (ii) one (1) of the
top ten (10) highest paid employees of the Employer or Affiliate in the
current or preceding Plan Year, the Maximum Compensation paid to and
Contributions made on behalf of such Family Member shall be deemed to have
been made on behalf of such employee. In calculating the Maximum
Compensation paid to such Family Member, the Maximum Compensation of the
Employee, the Employee's spouse and any lineal descendants under the age of
nineteen (19) shall be limited to two hundred thousand dollars ($200,000), as
adjusted by the Secretary of Treasury.
Any former employee shall be treated as a Highly Compensated Employee
if such employee was a Highly Compensated Employee (1) when he terminated
employment, or (ii) in any year following attainment of age fifty-five (55).
In addition, an employee who works only on a de minimis amount of service may
be considered a Highly Compensated Employee.
1.27(b) The following employees shall be excluded for purposes of
determining who is in the top-paid group under Section 1.27(a)(iii):
(i) employees who have not completed six (6) months of service;
(ii) employees who normally work less than seventeen and one-half
(17 1/2) hours per week;
(iii) employees who normally work not more than six (6) months
during any year;
(iv) employees who have not attained age twenty-one (21);
(v) except to the extent provided in regulations, employees who
are included in a collective bargaining agreement between employee
representatives and an Employer or Affiliate; and
(vi) Employees who are nonresident aliens and who receive no
earned income, within the meaning of the IRC Section 911(d)(2), from an
Employer or Affiliate which constitutes income from sources within the United
States, within the meaning of IRC Section 861(a)(3).
1.27(c) For purposes of this Section, the following definitions shall
apply:
(i) The term "Family Member" as used herein shall mean with
respect to any employee, such employee's spouse and lineal ascendants or
descendants and the spouses of such lineal ascendants or descendants.
(ii) The term "Five Percent (5%) Owner" shall have the same meaning
as specified in IRC Section 416(i).
1.27(d) The determination of Maximum Compensation for purposes of
determining who is a Highly Compensated Employee shall be made without regard
to IRC Sections 125, 402(a)(8), and 402(h)(1)(B), and in the case of
contributions by the Employer made pursuant to a salary reduction agreement,
without regard to IRC Section 403(b).
1.28 Hours of Service means the sum of:
1.28(a) Each hour for which an employee is paid, or entitled to
payment, for the performance of duties for the Employer during the applicable
computation period.
1.28(b) Each hour for which an employee is paid, or entitled to
payment, by the Employer on account of a period of time during which no
duties are performed (irrespective of whether the employment relationship has
terminated) due to vacation, holiday, illness, incapacity (including
disability), layoff, jury duty or leave of absence. However, the
determination of hours under this Section 1.28(b) shall be subject to the
following restrictions:
(i) No more than five hundred one (501) hours shall be credited
to an employee during any single continuous period during which the employee
performs no duties (whether or not such period occurs in a single computation
period).
(ii) No hours shall be credited to an employee if payment is made
or due under a plan maintained solely for the purpose of complying with
applicable workers' compensation, unemployment compensation or disability
insurance laws.
(iii) Hours shall not be credited for a payment which solely
reimburses an employee for medical or medically related expenses incurred by
the employee.
1.28(c) Each hour for which an employee is paid, or entitled to
payment, by the Employer on account of an Approved Absence during which no
duties are performed and any other periods in which an employee was not paid
or entitled to payment and presumably would have performed services for the
Employer but for the fact that the employee was on an Approved Absence.
1.28(d) Each hour for which back pay, irrespective of mitigation of
damages, is either awarded or agreed to by the Employer provided that the
same hours shall not be credited both under Sections 1.28(a), 1.28(b), or
1.28(c) and 1.28(d) hereunder.
Hours of Service shall not include any period during which the
employee was employed by a predecessor of the Employer, unless the
predecessor's organization maintained the Plan or a predecessor plan, or
credit for such period of employment otherwise is granted under the Plan.
Hours of Service under Sections 1.28(a), 1.28(c) and 1.28(d) shall be
determined from the Employer records. Hours of Service under Section 1.28(b)
shall be determined in accordance with Department of Labor Regulations
2530.200b-2. Hours of Service hereunder shall be credited to the appropriate
computation period in accordance with Department of Labor Regulation
2530.200b-2(c).
Notwithstanding anything herein to the contrary, nothing in this
Section 1.28 shall be construed to alter, amend, modify, invalidate, impair
or supersede any law of the United States or any rule or regulation issued
under any such law.
1.29 Investment Policy Committee means the Retirement Plan Investment
Policy Committee provided for in Article VIII.
1.30 IRC means the Internal Revenue Code of 1986, as amended from time to
time. Any reference to any section of the IRC shall be deemed to include any
applicable regulations and rulings pertaining to such section and also shall
be deemed a reference to comparable provisions of future laws.
1.31 Limitation Year means the twelve (12) month period commencing on
January 1 and ending on December 31.
1.32 Maternity or Paternity Absence means an absence from work for any
period by reason of (i) pregnancy of the Employee, (ii) birth of a child to
the Employee, (iii) placement of a child with the Employee in connection with
the adoption of such child, or (iv) absence for purposes of caring for such
child for a period immediately following such birth or placement.
1.33 Non-Highly Compensated Employee means any Employee who is not a Highly
Compensated Employee.
1.34 Normal Retirement Age means the later of (a) the date on which a
Participant attains the age of sixty-five (65) or (b) the fifth (5th)
anniversary of the date the Participant commenced participation in the Plan.
1.35 Normal Retirement Date means the first day of the month coinciding
with or next following the date on which the Participant attains his Normal
Retirement Age.
1.36 Norman Plan means the Pension Plan of R. W. Norman Division of Stanley
Interiors Corporation.
1.37 One Year Break in Service means, for periods commencing on and after
January 1, 1993, a Plan Year during which a terminated Employee has not
completed more than five hundred (500) Hours of Service. The number of
Hours of Service shall be determined in accordance with Section 1.28, except
that a One Year Break in Service shall not be deemed to have occurred if the
failure to complete more than five hundred (500) Hours of Service is due
solely to an Approved Absence.
For periods commencing on or after January 1, 1985, and to the extent
not already credited, Hours of Service shall be credited solely for purposes
of determining whether a One Year Break in Service has occurred with respect
to an Employee who is absent from work regardless of whether the Employee is
paid for such absence for an Approved Absence due to Maternity or Paternity
Absence. Hours of Service to be credited for such purpose shall be:
(i) the Hours of Service which otherwise normally would have been
credited to such Employee but for such absence; or
(ii) in any case in which the Administrative Committee is unable to
determine the hours in (i) above, eight (8) Hours of Service per normal work
day of absence.
The total number of hours treated as Hours of Service by reason of any
Maternity or Paternity Absence shall not exceed five hundred one (501) hours.
The hours in items (i) and (ii) above shall be treated as Hours of Service
hereunder:
(iii) only in the Plan Year in which the Maternity or Paternity
Absence from work begins, if an Employee would be prevented from incurring a
One Year Break in Service in such Plan Year solely because the period of
Maternity or Paternity Absence is treated as Hours of Service; or
(iv) in any other case, in the immediately following Plan Year.
Further, the Administrative Committee may request that the Employee
furnish any information the Administrative Committee may require to establish
that the absence is for the reasons hereinbefore provided and the number of
days for which there was such an absence. If such information is not
submitted in a timely manner, no Hours of Service shall be credited under
this Section.
For periods commencing on or after August 5, 1993, and to the extent
not already credited, Hours of Service shall be credited solely for purposes
of determining whether a One Year Break in Service has occurred with respect
to an Employee who is absent from work, regardless of whether the Employee is
paid for such absence, under the provisions of the Family and Medical Leave
Act of 1993.
1.38 Participant means any Employee who becomes a Participant as provided
in Article II.
1.39 Plan means the Stanley Retirement Plan, as contained herein or as duly
amended.
1.40 Plan Year means each twelve (12) month period beginning on January 1
and ending on December 31.
1.41 Pre-existing Plan means any retirement plan of the Stanley Furniture
Company Division (formerly a division of The Mead Corporation and, as of
November 28, 1979, a division of the Corporation) in effect immediately prior
to the Effective Date as to any group or unit of employees.
1.42 Service means the period of time determined in accordance with
Sections 1.42(a) and 1.42(b), subject to Sections 1.42(c), 1.42(d), 1.42(e),
1.42(f), 1.42(g) and 1.42(h) below.
1.42(a) For Periods through December 31, 1992 - Service includes all
service performed as a full-time employee after the attainment of age
seventeen (17), including time on Approved Absence. For a full-time
employee, Service commences on the initial date of employment of an Employee,
or if later, his seventeenth birthday and shall cease upon termination of
employment. For part-time or seasonal employees, Service commences on
the first day of the first period of twelve (12) consecutive months in which
the Employee (a) accumulates one thousand (1,000) or more Hours of Service
and (b) has attained seventeen (17) or more years of age on the first day of
such twelve (12) month period. Thereafter, the part-time or seasonal
employee shall be treated as a full-time employee.
1.42(b) For Periods Commencing on and After January 1, 1993 - Service
includes all service performed as a full-time employee after the attainment
of age seventeen (17) including time on Approved Absence. Service commences
on the first day of the Plan Year in which the employee (a) accumulates 1,000
or more Hours of Service and (b) has attained seventeen (17) ore more years
of age as of the first day of such Plan Year.
1.42(c) Any Employee who was excluded from participation in the Plan
for periods prior to January 1, 1988, because he had attained age sixty (60)
at his initial date of employment and who completes an Hour of Service on or
after January 1, 1988, shall receive Service in accordance with the
provisions of this Section 1.42 for such period of employment.
1.42(d) Service, for former employees of United Globe Company,
Burlington Industries, Inc., and United Furniture Company who were hired by
the Raleigh Road Furniture Corporation prior to April 1, 1986, and who were
employees of such corporation on December 31, 1986, shall include service
with all such corporations for purposes of vesting, eligibility to
participate, and eligibility for early retirement. Service for all other
former employees of the Raleigh Road Furniture Corporation who were employed
by such corporation on December 31, 1986, shall include all service with such
corporation for purposes of vesting, eligibility to participate, and
eligibility for early retirement.
1.42(e) Service, for Employees who were participants in the Norman
Plan as of December 31, 1993, shall include service with such division for
purposes of vesting, eligibility to participate, and eligibility for early
retirement.
For purposes of determining vesting in accordance with Section 5.01:
1.42(f) Periods of paid or unpaid leave taken pursuant to the Family
and Medical Leave Act of 1993 shall be included;
1.42(g) Periods of employment with an Affiliate which would have
constituted Service had the Employee been employed by the Employer shall be
included as if such periods had been performed for the Employer; and
1.42(h) Periods of employment with the Employer other than as an
Employee which would have constituted Service had the Employee been employed
as an Employee shall be included as if such periods had been performed as an
Employee.
1.43 Social Security Retirement Age means the retirement age under Section
216(l) of the Social Security Act, except that such Section shall be applied
without regard to the age increase factor and as if the early retirement age
under Section 216(l)(2) of such Act were sixty-two (62).
1.44 Spouse means the person to whom the Participant is legally married.
1.45 Surviving Spouse means, as of any date, the person to whom the
Participant has been legally married throughout the one (1) year period
immediately preceding such date.
1.46 Taxable Wage Base means the contribution and benefit base under
Section 230 of the Social Security Act in effect as of the beginning of each
Plan Year.
1.47 Total and Permanent Disability or Total and Permanently Disabled means
disability resulting from a demonstrable injury or disease which will
permanently, continuously and wholly prevent an Employee who is a Participant
from engaging in any occupatio or performing any work for remuneration or
profit; provided, that this term shall not include any injury or disease
which (i) was contracted, suffered or incurred while the Participant
engaged in, or resulted from his having engaged in, a criminal enterprise,
(ii) was intentionally self-inflicted, (iii) arose out of service in the
armed forces of any country, or (iv) arose as a result of employment with or
while working for an Affiliate (other than an Employer). In determining
whether or not a Participant is Totally and Permanently Disabled, the
Administrative Committee may require the Participant to submit to a
physical examination at any reasonable time or times by one (1) or more
physicians approved by the Administrative Committee. Refusal by a
Participant to submit to any physical examination shall be deemed to
constitute recovery from disability for purposes of the Plan.
1.48 Trust Agreement means the agreement entered into between the Employer
and the Trustee pursuant to Article VII.
1.49 Trustee means such individual, individuals or financial institution,
or a combination of them as shall be designated in the Trust Agreement to
hold in trust the assets of the Plan and shall include any successor Trustee
to the Trustee initially designated thereunder.
1.50 Year of Service means, for periods through December 31, 1992, any
consecutive period of twelve (12) months of service. Commencing January 1,
1993, Year of Service means, for any Employee, a stated twelve (12)
consecutive month period during which the Employee completed one thousand
(1,000) or more Hours of Service, including time on Approved Absence. For
Employees who were participants in the Norman Plan, Years of Service prior to
January 1, 1994, shall be determined in accordance with the provisions of
the Norman Plan.
If an Employee is simultaneously in the employ of more than one
Employer or is transferred from the employment of one Employer to the
employment of another Employer, the number of Hours of Service completed
during any twelve (12) consecutive month period shall be the sum of the
number of Hours of Service completed for each Employer during such period.
For purposes of determining eligibility in Article II:
1.50(a) Periods of paid or unpaid leave taken pursuant to the
Family and Medical Leave Act of 1993 shall be included;
1.50(b) Periods of employment with an Affiliate which would have
constituted a Year of Service had the Employee been employed by the Employer
shall be included as if such periods had been performed for the Employer; and
1.50(c) Periods of employment with the Employer other than as an
Employee which would have constituted a Year of Service had the Employee been
employed as an Employee shall be included as if such periods had been
performed as an Employee.
ARTICLE II
ELIGIBILITY AND PARTICIPATION
2.01 Eligibility - Each person who was a Participant on December 31, 1988,
shall continue as a Participant after such date, subject to the provisions
hereinafter contained.
For periods through December 31, 1992, each person (a) who becomes an
Employee and (b) who completes at least one (1) year of Service on or after
the later of (i) January 1, 1989, or (ii) the Effective Date shall be
eligible to become a Participant, and shall continue to be eligible so long
as he meets such requirements.
Effective for periods commencing on and after January 1, 1993, each
person (c) who becomes an Employee, (d) who has attained age seventeen (17)
and (e) who has completed at least one (1) Year of Service subsequent to the
date on which he completes his first Hour of Service shall automatically be
eligible to become a Participant upon the completion of the above
requirements and shall continue to be eligible so long as he meets such
requirements. Upon the completion of the first twelve (12) month period, the
twelve (12) month period for determining the Year of Service shall be based
on Plan Years starting with the Plan Year in which occurs the first
anniversary of the date on which an Employee completed the applicable first
Hour of Service.
Any employee who was previously excluded from participation because he
had attained age sixty (60) at his initial date of employment and who
completes an Hour of Service on or after January 1, 1988, shall be eligible
to become a Participant as of January 1, 1988, provided he has otherwise met
the requirements for participation. If such an Employee is not eligible for
participation as of January 1, 1988, because he does not otherwise meet the
requirements for participation, he shall be eligible for participation
following his satisfaction of the eligibility requirements.
2.02 Eligibility on Reemployment - If an Employee ceases to be a
Participant due to his termination of employment and later is reemployed, he
once again shall become a Participant on his reemployment date.
2.03 Eligibility for Participation - Each Employee, who has been included
in a Pre- existing Plan immediately before the applicable Effective Date,
shall be eligible to be included in this Plan as of such date, and shall
automatically be included in this Plan as a Participant as of such date
(subject to the provisions of Section 2.04), unless within thirty
(30) days after such Effective Date (or such other period as shall be
determined by the Administrative Committee) he shall notify his Employer that
he elects not to be included. Any employee who notifies his Employer shall
thereafter be eligible to enter this Plan only to the extent that he meets
the eligibility requirements in Section 2.01.
Notwithstanding the preceding, any managerial Employee who, because of
special
arrangements outside of the terms of any retirement plan, shall be deemed by
the
Compensation and Benefits Committee to be ineligible for inclusion in this
Plan, shall be
excluded from participation in the Plan.
An Employee of an Employer who was transferred from an Affiliate shall
be
ineligible for participation in the Plan if he continues to accrue credited
service under the
terms of any other qualified retirement plan maintained by the Affiliate.
2.04 Conditions to Participation - Participation in this Plan by any
eligible employee shall
be contingent upon receipt by his Employer of such consents, proofs of birth,
elections,
beneficiary designations, and other information as shall be prescribed by the
Administrative Committee. For this purpose, any such consents, proofs of
birth, elections,
beneficiary designations, or other documents or information, previously
furnished by an
Employee in connection with a Pre-existing Plan, shall be accepted by the
Administrative
Committee for purposes of this Plan, if, in its judgment, they are sufficient
and proper,
and the rights of the Employee are not impaired in any way. Each eligible
Employee shall
have thirty (30) days, or such additional time as may be determined to be
appropriate,
from his date of eligibility in which to elect not to become a Participant.
2.05 Reemployment of Retired Participants - If a Participant is reemployed
as an
Employee after the commencement of a retirement benefit due to retirement at
his Early
Retirement Date or the commencement of a benefit in accordance with the
provisions of
Section 5.02 but prior to the attainment of his Normal Retirement Age, his
retirement
benefit shall be discontinued. The Participant's rights to future benefits
under the Plan
shall be subject to redetermination upon any subsequent termination of
employment or
retirement under the Plan in accordance with the Plan provisions then in
effect. Any
benefits thereafter payable shall be adjusted to reflect the Actuarial
Equivalent value of
the retirement benefits received by the Participant in the period during
which he was in
receipt of a retirement benefit. Notwithstanding the preceding, the monthly
retirement
benefit thereafter payable shall not be less than the monthly retirement
benefit payable
immediately before his latest reemployment plus the Actuarial Equivalent of
any monthly
retirement benefit suspended while the Participant is not employed in service
as described
in Department of Labor Regulations 2530.203-3(c)(1).
Notwithstanding the preceding, if a Participant is reemployed as an
Employee after
the commencement of his monthly retirement benefit due to retirement at his
Early
Retirement Date or the commencement of a benefit in accordance with the
provisions of
Section 5.02 and such Participant is scheduled to work less than one thousand
(1,000) Hours
of Service during any Plan Year, he shall continue to receive the monthly
retirement
benefit payment determined and paid in every respect as if he were no longer
employed by
the Employer. Any such Participant shall be entitled to an additional
monthly retirement
benefit upon his subsequent termination of employment based on any accrual
earned
during his period of reemployment as indicated in the Appendix.
If a Participant is reemployed as an Employee after the commencement
of his monthly
retirement benefit under any of the provisions of the Plan and after
attainment of his
Normal Retirement Age, he shall continue to receive the monthly retirement
benefit
payment determined and paid in every respect as if he were no longer employed
by the
Employer. Any such Participant shall be entitled to an additional monthly
retirement
benefit upon his subsequent termination of employment based on any accrual
earned
during his period of reemployment after his Normal Retirement Age as
indicated in the
Appendix.
2.06 Change in Employment Status - A Participant who ceases to be an
Employee as
defined in Section 1.21 due to a change in employment status while remaining
an employee
of the Employer shall cease to accrue Credited Service as of the date of such
change in
employment status, but he shall continue to earn Service and become a limited
Participant
until such time as he again becomes an Employee as defined in Section 1.21.
If the limited
Participant does not again become an Employee as defined in Section 1.21
prior to his
termination of employment, the amount, if any, of the benefits to which he is
entitled
shall be determined based on his Credited Service as of the date of his
change in
employment status and Service as of the date of his termination of employment
including
Service earned while a limited Participant.
If an employee of the Employer becomes an Employee as defined in
Section 1.21 due
to a change in employment status with the Employer, he shall become eligible
for
participation as of the date of his change in employment status provided he
satisfies the
requirements of Article II as if he had been an Employee during such prior
period of
employment. If such an Employee becomes a Participant, he shall receive
Credited Service
only from the date of such change in employment status and Service from his
date of
employment in accordance with the provisions of Section 1.42.
ARTICLE III
RETIREMENT BENEFITS
3.01 Normal Retirement Benefit - Upon retirement at his Normal Retirement
Date, a
Participant shall receive a monthly retirement benefit which shall commence
on his
retirement date and shall be paid in accordance with Article IV. The amount
of such
monthly retirement benefit shall be equal to the benefit determined under the
applicable
Section 3.01(a), 3.01(b) or 3.01(c) below:
3.01(a) Normal Retirement Prior to January 1, 1994 - The amount of
the Participant's
monthly retirement benefit shall be equal to one-twelfth (1/12) of the sum of
(i) and (ii)
following:
(i) Seventy-five one-hundredths of one percent (.75%) of the
Participant's Final
Average Compensation multiplied by his Credited Service up to a maximum of
thirty-
seven (37) years; and,
(ii) One-half of one percent (.50%) of the Participant's Final
Average
Compensation in excess of his Covered Compensation multiplied by his Credited
Service
up to a maximum of thirty-five (35) years.
3.01(b) Normal Retirement On and After January 1, 1994 - The amount
of the
Participant's monthly retirement benefit shall be equal to the larger of (i),
(ii) and (iii), if
applicable, as follows:
(i) One-twelfth (1/12) of the sum of (A) and (B) following:
(A) Seventy-five one-hundredths of one percent (.75%) of the
Participant's Final
Average Compensation multiplied by his Credited Service; and
(B) One-half of one percent (.50%) of the Participant's Final
Average Compensation
in excess of his Covered Compensation multiplied by his Credited Service up
to a
maximum of thirty-five (35) years;
(ii) For Participants under the Plan as of December 31, 1993, the
Participant's
Accrued Benefit determined in accordance with the provisions of Sections
1.09, 1.14 and
3.01 as in effect on December 31, 1993; and
(iii) For any Participant whose Compensation exceeds the
limitations imposed by
IRC Section 401(a)(17), the sum of (A) and (B) following:
(A) For Participants in the Plan as of December 31, 1993, the
Participant's Accrued
Benefit determined in accordance with the provisions of Sections 1.09, 1.14
and 3.01 as in
effect on December 31, 1993; and
(B) Seventy-five one-hundredths of one percent (.75%) of the
Participant's Final
Average Compensation multiplied by his Credited Service on and after January
1, 1994,
plus one-half of one percent (.50%) of the Participant's Final Average
Compensation in
excess of his Covered Compensation multiplied by his Credited Service
effective on and
after January 1, 1994, up to a maximum of thirty-five (35) years less the
Participant's
Credited Service as of December 31, 1993;
provided, however, that Final Average Compensation will be
determined from
January 1, 1994 through the date of the Participant's termination or
retirement. In the
event the years of Final Average Compensation do not equal five (5), years
prior to
January 1, 1994 will be used to bring the number of years up to five (5).
3.01(c) Normal Retirement Benefit for Participants of the Norman Plan
- - For any
Participant who was a participant in the Norman Plan as of December 31, 1993,
who is
credited with an Hour of Service on or after January 1, 1994 and who
subsequently retires
under the provisions of this Plan, the amount of such Participant's monthly
retirement
benefit shall be equal to the sum of (i) and (ii) following:
(i) The accrued benefit as of December 31, 1993, earned by the
Participant under
the provisions of the Norman Plan in effect on December 31, 1993; and
(ii) The sum of (A) and (B) following:
(A) Seventy-five one-hundredths of one percent (.75%) of the
Participant's Final
Average Compensation multiplied by his Credited Service on and after January
1, 1994;
and
(B) One-half of one percent (.50%) of the Participant's Final Average
Compensation in
excess of his Covered Compensation multiplied by his Credited Service
effective on and
after January 1, 1994, up to a maximum of thirty-five (35) years less the
Participant's
Credited Service as of December 31, 1993;
provided, however, that Final Average Compensation will be
determined from
January 1, 1994 through the date of the Participant's termination or
retirement. In the
event the years of Final Average Compensation do not equal five (5), years
prior to
January 1, 1994 will be used to bring the number of years up to five (5).
3.02 Delayed Retirement Benefit - Upon retirement at his Delayed Retirement
Date, a
Participant shall receive a monthly retirement benefit which shall commence
on the date
of his retirement and shall be paid in accordance with Article IV. The
amount of the
monthly retirement benefit shall be the larger of Section 3.02(a) and Section
3.02(b)
following:
3.02(a) For periods through December 31, 1993, a monthly retirement
benefit
determined in the same manner as for retirement at his Normal Retirement Date
with
Final Average Compensation and Credited Service up to a maximum of
thirty-seven (37)
years computed as of his Delayed Retirement Date and Covered Compensation
computed
as of the earlier of his Delayed Retirement Date or his Social Security
Retirement Age.
For periods commencing on and after January 1, 1994, a monthly retirement
benefit
determined in the same manner as for retirement at his Normal Retirement Date
with
Final Average and Credited Service computed as of his Delayed Retirement Date
and
Covered Compensation computed as of the earlier of his Delayed Retirement
Date or his
Social Security Retirement Age.
3.02(b) A monthly retirement benefit determined in the same manner as
for
retirement at his Normal Retirement Date with Final Average Compensation,
Credited
Service and Covered Compensation computed as of the earlier of his Normal
Retirement
Date or his Social Security Retirement Age and the benefit shall be increased
so that such
monthly retirement benefit shall be the Actuarial Equivalent, as of his
Delayed
Retirement Date, of the monthly retirement benefit that would have been
payable had he
retired on his Normal Retirement Date.
3.03 Early Retirement Benefit - Upon retirement at his Early Retirement
Date, a
Participant shall receive a monthly retirement benefit which shall commence
on his
Normal Retirement Date and shall be paid in accordance with Article IV. The
amount of
the monthly retirement benefit shall be the Participant's Accrued Benefit as
of his Early
Retirement Date.
Notwithstanding anything contained herein to the contrary, a
Participant who retires
at an Early Retirement Date shall have the right to elect, in writing, to
receive his
retirement benefit commencing as of his Early Retirement Date or on the first
day of any
month thereafter which precedes his Normal Retirement Date. If the
Participant makes
the election to receive his retirement benefit at an earlier commencement
date, the amount
of monthly retirement benefit payable at such earlier commencement date shall
be the
Participant's Accrued Benefit as of his Early Retirement Date reduced by the
Actuarial
Equivalent factors for early retirement to reflect the period by which the
benefit
commencement date precedes what otherwise would be the Participant's Normal
Retirement Date.
3.04 Disability Retirement Benefit - Upon retirement at his Disability
Retirement Date, a
Participant shall receive a monthly retirement benefit which shall commence
on his
Normal Retirement Date, if he is then living, and shall be paid in accordance
with Article
IV. The amount of the monthly retirement benefit shall be the Participant's
Accrued
Benefit as of his Disability Retirement Date.
Notwithstanding anything contained herein to the contrary, a Totally
and
Permanently Disabled Participant shall have the right to elect, in writing,
to receive his
retirement benefit commencing as of his Disability Retirement Date or on the
first day of
any month thereafter which precedes his Normal Retirement Date. If the
Totally and
Permanently Disabled Participant makes the election to receive his retirement
benefit at
an earlier commencement date, the amount of monthly retirement benefit
payable at such
earlier commencement date shall be the Participant's Accrued Benefit as of
his Disability
Retirement Date.
If a Totally and Permanently Disabled Participant in receipt of or
eligible for a
monthly retirement benefit in accordance with this Section 3.04 recovers to
the extent that
he is no longer Totally and Permanently Disabled, he no longer shall be
entitled to a
disability retirement benefit hereunder. If the Totally and Permanently
Disabled
Participant had elected to commence his monthly disability retirement
benefit, his
disability retirement benefit shall then cease.
A Participant may elect not to receive the disability retirement
benefit provided
under this Section 3.04 and shall also be ineligible to receive any form of
early retirement
benefit under Section 3.03. If a Participant who has made such an election
is determined
by the Administrative Committee to be Totally and Permanently Disabled, he
shall be
treated for purposes of the Plan as though he were on an Approved Absence.
Upon
attaining his Normal Retirement Date, he shall be eligible to receive a
normal retirement
benefit in accordance with the provisions of Section 3.01.
The election to waive a disability retirement benefit shall be made in
writing to the
Administrative Committee prior to the Participant's commencing any form of
retirement
income benefit, and may be revoked in writing to the Administrative Committee
at any
time prior to the date the Participant would otherwise be eligible to
commence a
retirement benefit under this Plan, but no such election or revocation shall
have any
retroactive effect. In the event of such revocation, the amount of such
Participant's
disability retirement benefit shall be determined as his Accrued Benefit as
of the date he
was determined to be Totally and Permanently Disabled and the Participant
shall again be
eligible to commence a retirement benefit under Section 3.03 of this Plan.
In no event shall the disability benefit provided under this Section
be payable prior to
the Participant's attainment of his Normal Retirement Date for any period in
which wages
or salary are payable to him from any source.
The amount of disability benefit under this Section 3.04 shall be
inclusive of and, in
no event, less than the Actuarial Equivalent of any disability benefit which
shall have
accrued to the credit of the Participant with respect to service under any
Pre-existing
Plans prior to becoming included in this Plan.
3.05 Pre-1970 Minimum Retirement Income - Any employee who was a
Participant in the
pre-existing Employee's Retirement Plan of Stanley Furniture Company at its
Stanleytown
or Ferrum, Virginia plants on March 31, 1970, shall be eligible for a minimum
retirement
benefit upon his retirement or termination with a vested benefit. Such
benefit shall be
equal to the sum of Sections 3.05(a) and 3.05(b) below:
3.05(a) Years Prior to April 1, 1970 - An annual amount determined
under the
provisions of the pre-existing Employee's Retirement Plan of Stanley
Furniture Company
as in effect on March 31, 1970, as follows:
(i) One-half of one percent (.50%) multiplied by the
Participant's Final Average
Earnings on January 1, 1976, multiplied by his years of Credited Service
(with
proportionate allowance for completed months); plus
(ii) An additional one percent (1%) of Final Average Earnings on
January 1, 1976,
in excess of four thousand eight hundred dollars ($4,800) multiplied by his
years of
Credited Service (with proportionate allowance for completed months);
(iii) The total of (i) and (ii) shall be multiplied by a fraction,
the numerator of
which is the Participant's Service prior to April 1, 1970, and the
denominator of which is
his total Service at his date of retirement or termination of service;
3.05(b) Years Subsequent to March 31, 1970 - The Participant's
retirement income
determined under Section 3.01, 3.02, 3.03, or 3.04 of the Plan (whichever is
applicable),
multiplied by a fraction, the numerator of which is the Participant's Service
after March
31, 1970, and the denominator of which is his total Service at his date of
retirement or
termination of employment.
3.06 Relationship to Retirement Income Under Pre-existing Plan - The
amount of
retirement income determined in Section 3.01 shall be inclusive of and, in no
event, less
than the Actuarial Equivalent of any retirement benefit, profit sharing
balance or other
vested cash interest of a Participant which shall have accrued to the credit
of the
Participant under any Pre-existing Plan with respect to service prior to
becoming a
Participant in this Plan.
3.07 Withdrawal of Contributions - A Participant who has made contributions
in
accordance with the provisions of this or a Pre-existing Plan may withdraw
his
contributions at the time of the termination of his employment or at such
other times as
may be permitted by the Administrative Committee on a uniform and
nondiscriminatory
basis.
3.07(a) As of any applicable date, the Accrued Benefit of a
Participant derived from
Employer Contributions shall be the excess, if any, of the total Accrued
Benefit of the
Participant as of such date over the Accrued Benefit derived from
contributions made by
the Participant under the Plan as of such date; and
3.07(b) The Accrued Benefit of a Participant derived from
contributions made by the
Participant as of such date shall be an annual benefit, in the form of a
single life annuity
(without ancillary benefits) commencing at his Normal Retirement Date, equal
to the
amount of the Participant's accumulated contributions (as determined under
Treasury
Regulations 1.411(c)-1(c)(3)) multiplied by the appropriate conversion factor
determined
under Treasury Regulations 1.411(c)-1(c)(2).
3.08 Special Rules for Certain Employees Participating in the Stanley
Retirement Plan
for Waynesboro Hourly Employees - Effective January 1, 1983, the Stanley
Retirement
Plan for Waynesboro Hourly Employees (the "Waynesboro Plan") was merged into
this Plan.
In connection with that merger, the following special rules shall apply:
3.08(a) Except as provided in Section 3.08(c), the benefits of any
individual who was
a participant in the Waynesboro Plan and whose employment terminated for any
reason
before January 1, 1983, shall be determined under the provisions of the
Waynesboro Plan
as in effect at the time of such termination of employment;
3.08(b) In no event shall the benefit payable to any Participant in
this Plan who was a
participant in the Waynesboro Plan be less than the benefit that would have
been payable
to such Participant under the Waynesboro Plan had that plan remained in
effect and the
merger not taken place; and
3.08(c) In the case of any participant in the Waynesboro Plan whose
employment
terminated by reason of normal retirement, early retirement or disability
retirement after
May 4, 1981, and before benefits were payable to such participant, his
benefit shall be
recalculated as though the terms and conditions of this Plan as in effect on
January 1,
1983, were applicable to such participant at the time of such termination of
employment
and, in the event such recalculated benefit exceeds the benefit otherwise
payable to such
participant, he or she shall be entitled to receive such higher benefit
commencing as of
January 1, 1983.
ARTICLE IV
NORMAL AND OPTIONAL METHODS OF RETIREMENT BENEFIT PAYMENTS
4.01 Normal Form of Payment - The normal form of payment shall be a monthly
retirement benefit commencing on the date specified in Section 3.01, 3.02,
3.03, 3.04 or
Section 5.02 and shall continue to be paid to the Participant on the first
day of each month
thereafter during his lifetime.
4.02 Available Options - No less than thirty (30) days and no more than
ninety (90) days
prior to the Annuity Starting Date, each Participant and his Spouse shall be
given a
written notice to the effect that benefits thereafter payable shall be in the
form specified
in Section 4.04 unless the Participant, with the written consent of his
Spouse, elects to the
contrary during the ninety (90) day period prior to the Annuity Starting
Date. The notice
shall describe, in a manner intended to be understood by the Participant and
his Spouse,
(a) the terms and conditions of the joint and survivor annuity specified in
Section 4.04
which shall include a general explanation of the financial effect of the
election or absence
of election, (b) the rights of the Participant's Spouse, (c) the relative
values of the various
optional forms of payment available under the Plan, and (d) the right to make
and the
effect of a revocation of a previous election to waive the joint and survivor
annuity
specified in Section 4.04.
If a Participant or his Spouse requests additional information, as
permitted under the
terms of the notice, commencement of benefits for any purpose hereunder shall
not begin
until at least ninety (90) days following the receipt of such additional
information.
In accordance with the preceding provisions of this Section 4.02, each
Participant,
with the written consent of his Spouse, shall have the right to elect to have
his retirement
benefit paid under any one of the options hereinafter set forth in this
Section 4.02 in lieu
of the applicable retirement benefit otherwise provided for in Section 4.01.
The amount of
any optional retirement benefit shall be the Actuarial Equivalent of the
amount of
retirement benefit that otherwise would have been payable to him as provided
for in
Section 4.01.
A Participant who desires to have his retirement benefit paid under
one of the
optional forms provided in this Section 4.02 shall make such an election by
written request
to the Administrative Committee on forms provided by the Administrative
Committee. An
election by a Participant to receive his retirement benefit under any of the
optional
methods of payment as provided in this Section 4.02 and the spousal consent
to such
optional form of payment may be revoked by such Participant in writing to the
Administrative Committee at any time prior to his Annuity Starting Date.
After
retirement benefit payments have commenced, no future elections or
revocations of an
optional form will be permitted under any circumstances.
4.02(a) JOINT AND SURVIVOR OPTION
A Participant may elect to receive a decreased retirement benefit
during his lifetime
and have fifty percent (50%) of such decreased retirement benefit continue
after his death
to his designated Beneficiary, during the lifetime of the Beneficiary. If
the designated
Beneficiary is not living at the death of the Participant, no additional
benefits shall be
payable on behalf of the Participant.
4.02(b) JOINT AND MINOR SURVIVOR OPTION
A Participant may elect to receive a decreased retirement benefit
during his lifetime
and have fifty percent (50%) of such decreased retirement benefit continue
after his death
to a Beneficiary who is a minor lineal descendant until such person attains
age twenty-one
(21) if such event occurs after the death of the retired Participant.
4.02(c) LUMP SUM OPTION
A Participant who is eligible to retire pursuant to Section 3.01,
3.02, 3.03 or 3.04 may
elect to receive his retirement benefit in a lump sum. Effective January 1,
1994, such
Participant may elect to receive the portion of his benefit attributable to
his Accrued
Benefit as of December 31, 1993, in a lump sum. The remaining portion of his
Accrued
Benefit attributable to periods commencing on and after January 1, 1994,
shall be paid in
accordance with Section 4.01, or if elected by the Participant, pursuant to
the provisions of
Section 4.02, in one of the optional forms specified in Section 4.02(a) or
(b).
Notwithstanding the preceding, a Participant who retires pursuant to Section
3.01, 3.02,
3.03 or 3.04 during the 1994 calendar year may elect to receive his
retirement benefit in a
lump sum.
4.02(d) OPTIONAL FORMS OF PAYMENT FOR NORMAN PLAN PARTICIPANTS
In lieu of the payment options available under this Plan, a
Participant in the Norman
Plan as of December 31, 1993, may elect to have the portion of his Accrued
Benefit
attributable to Section 3.01(c)(i) distributed to him in one of the optional
forms of
payment available under the Norman Plan as in effect on December 31, 1993.
The amount
of Accrued Benefit determined under Section 3.01(c)(ii) shall be distributed
in accordance
with the provisions of this Plan as in effect on the later of January 1,
1994, or the date of
distribution.
4.03 Maximum Option Payable - If a Participant elects an optional form of
payment, and
the designated Beneficiary is not the Spouse of the Participant, the option
elected shall be
restricted so that the minimum distribution incidental benefit requirements
of IRC Section
401(a)(9) and Treasury Regulations 1.401(a)(9)-2 are met.
4.04 Automatic Option - Unless a married Participant, with the consent of
his Spouse, has
elected an optional form of payment under Section 4.02 and has not revoked
the election,
or has elected to be excluded from the effects of this automatic option, it
automatically
shall be assumed that the married Participant elected the Joint and Survivor
Option of
Section 4.02(a) with fifty percent (50%) of his benefit amount payable after
his death to
his Beneficiary and with his Spouse on the effective date of this option
designated as his
Beneficiary. This automatic option shall become effective and benefits
adjusted
accordingly as of the date benefit payments commence.
It is specifically provided that the Spouse of the Participant shall
consent in writing
to any form of payment other than that provided under this Section 4.04
during the ninety
(90) day period prior to the Annuity Starting Date. The Spouse's written
consent shall be
witnessed by a representative of the Administrative Committee or a notary
public. The
Administrative Committee may accept a Participant's election without the
consent of his
Spouse if there is no Spouse, the Spouse cannot be located, or under such
other
circumstances as may be prescribed by regulations. Any spousal consent shall
apply only
to the Spouse granting such written consent.
4.05 Lump Sum Payments - Notwithstanding any other provisions of this Plan,
if (a) the
Actuarial Equivalent of a terminated or retiring Participant's vested Accrued
Benefit
payable at Normal Retirement Date as calculated at the date of distribution
does not
exceed three thousand five hundred dollars ($3,500) (including any previous
distributions
made to the Participant) or such other amount as may be prescribed by the
Secretary of
Treasury or (b) the Participant and his Spouse agree, in writing, if the
Actuarial
Equivalent of his vested Accrued Benefit as of December 31, 1993, payable at
his Normal
Retirement Date, is in excess of three thousand five hundred dollars ($3,500)
(including
any previous distributions made to the Participant), the Administrative
Committee shall
direct that such amount be paid in a lump sum to such terminated or retiring
Participant.
If the Actuarial Equivalent of a Participant's vested Accrued Benefit at the
time of any
distribution exceeds three thousand five hundred dollars ($3,500) (including
any previous
distributions made to the Participant), then the Actuarial Equivalent of the
vested
Accrued Benefit at any subsequent time shall be deemed to exceed three
thousand five
hundred dollars ($3,500). For purposes of this Section 4.05, the date of
distribution shall
be deemed to be the date of termination of employment, provided that any
disparity
between such dates is due to reasonable administrative delay. No other
benefits of any
type shall be payable to such former Participant or his Spouse, Surviving
Spouse or
Beneficiaries.
If a terminated or retiring Participant who received a distribution
under this Section
4.05 is reemployed and again becomes a Participant, his Credited Service
shall include all
periods of employment prior to his reemployment date, and his subsequent
benefit shall be
reduced by the Accrued Benefit attributable to the Participant's prior
distribution.
4.06 Consent Prior to Distribution from the Plan - Notwithstanding anything
contained in
the Plan to the contrary, the written consent of the Participant and his
Spouse (or where
either the Participant or the Spouse has died, the survivor) shall be
required prior to any
distribution of any portion of the Accrued Benefit if the present value of
the
nonforfeitable Accrued Benefit exceeds three thousand five hundred dollars
($3,500)
(including any previous distributions made to the Participant) and any such
distribution is
made prior to the later of the date the Participant attains (or would have
attained) his
Normal Retirement Age or age sixty-two (62). For purposes of this Section
4.06, if the
present value of the vested Accrued Benefit at the time of any distribution
under the Plan
exceeds three thousand five hundred dollars ($3,500) (including any previous
distributions
made to the Participant), then the present value of the vested Accrued
Benefit at any
subsequent time will be deemed to exceed three thousand five hundred dollars
($3,500).
No less than thirty (30) days and no more than ninety (90) days prior
to the Annuity
Starting Date, the Administrative Committee shall provide written notice to
the
Participant and his Spouse of the right to defer any distribution under the
Plan until the
later of the date the Participant attains (or would have attained) his Normal
Retirement
Age or age sixty-two (62). The notice shall include a general description of
the material
features and optional forms of payment available under the Plan and shall be
provided in
the same manner as provided in Section 4.02. The Participant and his Spouse
must consent
in writing to such distribution in the ninety (90) day period prior to the
Annuity Starting
Date.
Notwithstanding the preceding, the Participant's consent only shall be
required for
distribution of the benefit in the form of the qualified joint and survivor
annuity under
Section 4.04 prior to the later of the date he attains his Normal Retirement
Age or age
sixty-two (62). The consent of the Participant and his Spouse shall not be
required to the
extent that a distribution from the Plan is required to satisfy IRC Section
401(a)(9) or 415.
4.07 No Reduction of Accrued Benefits - Notwithstanding anything contained
herein to
the contrary, the following provisions shall apply to the Plan.
4.07(a) In no event shall any amendment to the Plan decrease a
Participant's Accrued
Benefit or eliminate an optional form of payment.
4.07(b) In no event shall a Participant's Accrued Benefit be reduced
on account of
any increase in his age or Credited Service; provided, that this provision
shall not apply to
benefits under the Plan commencing before entitlement to benefits payable
under Title II
of the Social Security Act, which benefits under the Plan (i) do not exceed
such Social
Security benefits, and (ii) terminate when such Social Security benefits
commence.
4.07(c) If the provisions of IRC Section 416 and regulations issued
thereunder apply
to the Plan, in no event shall a Participant's Accrued Benefit or benefit
payable at his
Normal Retirement Date be lower than the minimum benefit required under IRC
Section
416.
4.07(d) The benefit of a Participant, Spouse, Surviving Spouse or
Beneficiary who is
receiving benefits under the Plan, or a Participant who is terminated from
employment
and has a nonforfeitable right to benefits, shall not be decreased due to any
increase in the
benefit levels payable under Title II of the Social Security Act or any
increase in the wage
base under Title II if the increase takes place after the earlier of the date
of first receipt
of such benefits or the date of separation, as the case may be.
4.08 Direct Rollovers - Commencing on and after January 1, 1993, and
notwithstanding
any provisions of the Plan to the contrary that would otherwise limit a
Distributee's
election under Section 4.02, a Distributee may elect, at the time and in the
manner
prescribed by the Committee, to have any portion of an Eligible Rollover
Distribution paid
directly to an Eligible Retirement Plan specified by the Distributee in a
Direct Rollover.
For purposes of this Section 4.08, the following definitions shall
apply:
4.08(a) Eligible Rollover Distribution - Any distribution of all or
any portion of the
balance to the credit of the Distributee, except that an Eligible
Distribution does not
include:
(i) Any distribution that is one of a series of substantially
equal periodic payments
(not less frequently than annually) made for the life (or life expectancy) of
the Distributee
or the joint lives (or joint life expectancies) of the Distributee and the
Distributee's
designated Beneficiary, or for a specified period of ten (10) years or more;
(ii) Any distribution to the extent such distribution is required
under IRC Section
401(a)(9); and
(iii) 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).
4.08(b) Eligible Retirement Plan - An individual retirement account
described in IRC
Section 408(a), an individual retirement annuity described in IRC Section
408(b), an
annuity plan described in IRC Section 403(a), or a qualified trust described
in IRC Section
401(a) that accepts the Distributee's Eligible Rollover Distribution.
However, in the case
of an Eligible Rollover Distribution to the surviving Spouse, an Eligible
Retirement Plan
is an individual retirement account or individual retirement annuity only.
4.08(c) Distributee - A Distributee includes an Employee or former
Employee. In
addition, the Employee's or former Employee's surviving Spouse and the
Employee's or
former Employee's Spouse or former Spouse who is an alternate payee under a
qualified
domestic relations order, as defined in IRC Section 414(p), are Distributees
with regard to
the interest of the spouse or Former Spouse.
4.08(d) Direct Rollover - A payment by the Plan to the Eligible
Retirement Plan
specified by the Distributee.
ARTICLE V
BENEFITS ON TERMINATION OF EMPLOYMENT
5.01 Vesting of Benefits - All rights to all benefits under the Plan will
cease upon a
Participant's termination of employment with the Employer or Affiliate prior
to
retirement, other than by death, except as otherwise provided in this Article
V and in
Section 6.05.
If a Participant's employment with the Employer or Affiliate is
terminated prior to
retirement, other than by death, but after the Participant has completed at
least five (5)
years of Service, he shall receive a monthly retirement benefit commencing on
his Normal
Retirement Date, if he is then alive, payable in accordance with Section
5.02. The amount
of the benefit shall be equal to the Participant's Accrued Benefit as of his
date of
termination of employment with Compensation for purposes of computing his
Final
Average Compensation determined based on the IRC Section 401(a)(17)
compensation limit
as in effect on his date of termination of employment. Notwithstanding
anything
contained herein to the contrary, in all events a Participant shall be one
hundred percent
(100%) vested upon the attainment of his Normal Retirement Age.
No amendments to the Plan made subsequent to termination of employment
of any
Participant shall affect the amount of retirement benefit to which such
Participant is
entitled except as otherwise specifically provided herein.
If a Participant who is entitled to a deferred retirement benefit
under the provisions
of this Section 5.01 later is reemployed as an Employee prior to the
commencement of such
retirement benefit, his rights to any such retirement benefit shall thereupon
be suspended.
Such Participant's rights to benefits under the Plan shall be subject to
redetermination at
any subsequent termination of employment or retirement under the Plan in
accordance
with the provisions of the Plan then in effect.
5.02 Payment of Deferred Vested Benefit - A terminated Participant who is
entitled to a
deferred vested benefit in accordance with the provisions of Section 5.01
shall be entitled
to receive his benefit commencing as of his Normal Retirement Date, if he is
then alive,
paid in accordance with Article IV.
Notwithstanding the preceding, a terminated Participant who has
completed at least
ten (10) years of Service at his date of termination of employment may elect
in writing to
have his otherwise deferred monthly retirement benefit commence on the first
day of the
month coinciding with or next following his attainment of age fifty-five (55)
or on the
first day of any month thereafter which precedes his Normal Retirement Date.
If a
terminated Participant makes an election to receive his retirement benefit at
an earlier
commencement date, the amount of the monthly retirement benefit payable at
such earlier
commencement date shall be equal to the amount of monthly retirement benefit
otherwise
deferred to his Normal Retirement Date reduced by the Actuarial Equivalent
factors to
reflect the period by which the benefit commencement date precedes what
otherwise
would be the Participant's Normal Retirement Date.
A Participant who has no vested interest in his Accrued Benefit shall
be deemed to be
paid his entire interest in the Plan upon his termination of employment and
shall forfeit
the nonvested portion of his Accrued Benefit as of such date. However, if
the Participant
is reemployed and again becomes a Participant prior to incurring five (5)
consecutive One
Year Breaks in Service or, in the case of Service determined under the
provisions of
Section 1.42(a), five (5) consecutive monthly periods resulting from his
termination of
employment for which he did not receive credit for Service during such
period, such
forfeited portion of the Accrued Benefit shall be reinstated.
5.03 Vested Deferred Retirement Income - A Vested Participant whose
employment
terminates for any reason other than death or retirement, may (a) elect to
leave his
contributions (if any) in the Fund and receive a retirement income amount
determined on
the basis of his Credited Service up to the date of his termination of
employment,
commencing at his Normal Retirement Date, or (ii) elect to receive a refund
of his
personal contributions and receive a deferred annuity in an actuarially
reduced amount as
determined under regulations issued by the Secretary of Labor from time to
time.
5.04 Pre-existing Plan Accounts - If a terminated Participant has an
account under any
Pre-existing Plan, his right of withdrawal of that account, if any, shall be
governed by the
terms of the Pre-existing Plan.
ARTICLE VI
BENEFITS ON DEATH
6.01 Death After Eligibility for Early Retirement - If an active
Participant dies after
attaining age fifty-five (55) and completing at least ten (10) years of
Service, or a
Participant who retired at his Early Retirement Date dies prior to the
commencement of
his early retirement benefit, a death benefit shall be payable to his
Surviving Spouse. The
death benefit shall be determined assuming that the Participant had retired
and elected to
have his early retirement benefit paid under the Joint and Survivor Option of
Section
4.02(a) with fifty percent (50%) of his benefit payable after his death to
his Surviving
Spouse as his designated Beneficiary.
The amount of the death benefit payable to the Surviving Spouse shall
be equal to the
Participant's Accrued Benefit as of his date of death reduced by the
Actuarial Equivalent
factors for early retirement for the period by which the benefit commencement
date
precedes what otherwise would be the Participant's Normal Retirement Date and
the
payment of the benefit under the fifty percent (50%) Joint and Survivor
Option of Section
4.02(a).
The Surviving Spouse may elect in writing to have the death benefit
commence on the
first day of the month coinciding with or next following the Participant's
date of death or
on the first day of any month thereafter which precedes what otherwise would
be the
Participant's Normal Retirement Date. If the Surviving Spouse does not make
such
election, the benefit shall commence on what otherwise would be the
Participant's Normal
Retirement Date. Such benefit shall continue on the first day of each month
thereafter
for the Surviving Spouse's lifetime.
Notwithstanding the preceding, if the Actuarial Equivalent of the
benefit payable to
the Surviving Spouse under this Section 6.01 does not exceed three thousand
five hundred
dollars ($3,500), the Administrative Committee shall direct payment of the
benefit in a
lump sum to the Surviving Spouse. No lump sum distribution shall be made
hereunder
after the first day of the first period for which an amount is received as an
annuity by the
Surviving Spouse unless the Surviving Spouse consents in writing to a lump
sum payment.
6.02 Death After Eligibility for Normal Retirement - If an active
Participant dies after
attaining his Normal Retirement Age or if a Participant who has retired at
his Normal
Retirement Date or Delayed Retirement Date dies prior to the commencement of
his
normal or delayed retirement benefit, a death benefit shall be payable to his
Surviving
Spouse. The death benefit shall be determined assuming that the Participant
had retired
and elected to have his benefit paid under the Joint and Survivor Option of
Section 4.02(a)
with fifty percent (50%) of his benefit payable after his death to his
Surviving Spouse as
his designated Beneficiary.
The amount of the death benefit payable to the Surviving Spouse shall
be equal to the
benefit the Participant would have been entitled to under the applicable
provisions of
Section 3.01 or 3.02 as of the Participant's date of death, reduced by the
Actuarial
Equivalent factors for the payment of the benefit under the fifty percent
(50%) Joint and
Survivor Option of Section 4.02(a).
The benefit payable to the Surviving Spouse shall commence on the
first day of the
month coinciding with or next following the Participant's date of death and
shall continue
on the first day of each month thereafter for the Surviving Spouse's
lifetime.
Notwithstanding the preceding, if the Actuarial Equivalent of the
benefit payable to
the Surviving Spouse under this Section 6.02 does not exceed three thousand
five hundred
dollars ($3,500), the Administrative Committee shall direct payment of the
benefit in a
lump sum to the Surviving Spouse. No lump sum distribution shall be made
hereunder
after the first day of the first period for which an amount is received as an
annuity by the
Surviving Spouse unless the Surviving Spouse consents in writing to a lump
sum payment.
6.03 Death After Eligibility for Disability Retirement - If a Totally and
Permanently
Disabled Participant who has retired at his Disability Retirement Date dies
prior to the
commencement of his disability retirement benefit, a death benefit shall be
payable to his
Surviving Spouse. The death benefit shall be determined assuming that the
Totally and
Permanently Disabled Participant had elected to have his disability
retirement benefit
paid under the Joint and Survivor Option of Section 4.02(a) with fifty
percent (50%) of his
benefit payable after his death to his Surviving Spouse as his designated
Beneficiary.
The amount of the death benefit payable to the Surviving Spouse shall
be equal to the
Participant's Accrued Benefit as of his Disability Retirement Date reduced by
the
Actuarial Equivalent factors for the payment of the benefit under the fifty
percent (50%)
Joint and Survivor Option of Section 4.02(a).
The Surviving Spouse may elect in writing to have the death benefit
commence on the
first day of the month coinciding with or next following the Participant's
death or on the
first day of any month thereafter which precedes what otherwise would be the
Participant's Normal Retirement Date. If the Surviving Spouse does not make
such an
election, the benefit shall commence on what otherwise would be the
Participant's Normal
Retirement Date. Such benefit shall continue on the first day of each month
thereafter
for the Spouse's lifetime.
Notwithstanding the preceding, if the Actuarial Equivalent of the
benefit payable to
the Surviving Spouse under this Section 6.03 does not exceed three thousand
five hundred
dollars ($3,500), the Administrative Committee shall direct payment of the
benefit in a
lump sum to the Surviving Spouse. No lump sum distribution shall be made
hereunder
after the first day of the first period for which an amount is received as an
annuity by the
Surviving Spouse unless the Surviving Spouse consents in writing to a lump
sum payment.
6.04 Death of a Vested Participant - If an active Participant who has
satisfied the
requirements for full vesting pursuant to Section 5.01 or if a terminated
Participant who
had satisfied the requirements for full vesting pursuant to Section 5.01 at
his date of
termination of employment dies before he is otherwise eligible to commence a
retirement
benefit under the provisions of the Plan, a death benefit shall be payable to
his Surviving
Spouse. The death benefit shall be determined assuming that the Participant
had elected
to have his deferred vested retirement benefit paid under the Joint and
Survivor Option of
Section 4.02(a) with fifty percent (50%) of his benefit payable after his
death to his
Surviving Spouse as his designated Beneficiary.
The amount of the benefit payable to the Surviving Spouse and the
commencement
date shall be determined in accordance with the following provisions.
6.04(a) If the Participant had completed ten (10) years of Service at
his date of death
or the date of his termination of employment, the death benefit payable to
his Surviving
Spouse shall be equal to the Participant's vested Accrued Benefit as of the
date of his
death or the date of his termination of employment. The amount so determined
shall be
reduced by the Actuarial Equivalent factors for early retirement to reflect
the period by
which the benefit commencement date precedes what otherwise would be the
Participant's
Normal Retirement Date and the payment of the benefit under the fifty percent
(50%)
Joint and Survivor Option of Section 4.02(a).
The Surviving Spouse may elect in writing to have the death benefit
commence on the
first day of the month coinciding with or next following the later of the
date of the
Participant's death or the date the Participant would have attained the age
of fifty-five
(55) or on the first day of any month thereafter which precedes what
otherwise would be
the Participant's Normal Retirement Date. If the Surviving Spouse does not
make such an
election, the benefit shall commence on what otherwise would be the
Participant's Normal
Retirement Date. Such benefit shall continue on the first day of each month
thereafter
for the Surviving Spouse's lifetime.
6.04(b) If the Participant had not completed ten (10) years of
Service at his date of
death or the date of his termination of employment, the death benefit payable
to the
Participant's Surviving Spouse shall commence on what otherwise would be the
Participant's Normal Retirement Date and continue on the first day of each
month
thereafter for the Surviving Spouse's lifetime. Such benefit shall be equal
to the
Participant's vested Accrued Benefit as of the date of his death or the date
of his
termination of employment and the amount so determined shall be reduced by
the
Actuarial Equivalent factors for payment of the benefit under the fifty
percent (50%)
Joint and Survivor Option of Section 4.02(a).
Notwithstanding the preceding, if the Actuarial Equivalent of the
benefit payable to
the Surviving Spouse under this Section 6.04 does not exceed three thousand
five hundred
dollars ($3,500), the Administrative Committee shall direct payment of the
benefit in a
lump sum to the Surviving Spouse. No lump sum distribution shall be made
hereunder
after the first day of the first period for which an amount is received as an
annuity by the
Surviving Spouse unless the Surviving Spouse consents in writing to a lump
sum payment.
6.05 Death Subsequent to Retirement - Upon the death of a retired or
Totally and
Permanently Disabled Participant who is receiving benefits under the Plan,
his Spouse,
Surviving Spouse or Beneficiary shall be entitled to any benefits due under
the basic or
elected alternate form of payment of his monthly retirement benefit. If the
period of
guaranteed payments is exhausted at the death of a retired Participant, no
death benefit
shall be payable.
ARTICLE VII
FUNDING
7.01 Contributions by the Employer - The entire cost of benefits under the
Plan shall be
borne by the Employer through the Fund. Any Contributions, if any, held on
behalf of a
Participant resulting from his participation in a prior Plan or Pre-existing
Plan shall also
be held in the Fund. The Employer intends to make its Contributions in such
actuarially
determined amounts as shall be sufficient to provide the benefits of the Plan
and meet the
minimum funding standards as required by law. The Contributions of the
Employer shall
be paid at such times, in such amounts and in such manner as the Compensation
and
Benefits Committee shall determine. Funds released through terminations of
employment
shall be applied to reduce the Employer's future Contributions.
7.02 Trust Fund - On behalf of all Employers, the Corporation shall enter
into an
agreement with the Trustee designated by the Compensation and Benefits
Committee
whereunder the Trustee will receive, invest and administer as a trust fund
all
Contributions made under this Plan in accordance with the Trust Agreement.
The
provisions of such Trust Agreement are incorporated by reference as a part of
the Plan,
and the rights of all persons hereunder are subject to the terms of the Trust
Agreement.
The Trust Agreement specifically provides, among other things, for the
investment and
reinvestment of the Fund and the income thereof, management of the Fund,
responsibilities and immunities of the Trustee, removal of the Trustee and
appointment of
a successor, accounting by the Trustee and disbursement of the Fund.
7.03 Funding Standard Account - The Corporation (which shall be the plan
administrator
for all Employers in regard to this appointment) shall engage, on behalf of
all Participants,
an actuary, an insurance company or an actuarial firm which maintains on its
staff at
least one (1) person who is recognized by the Secretaries of Labor and
Treasury as an
enrolled actuary. In addition to performing actuarial valuations and
providing actuarial
statements as necessary for the annual reports required by the Secretary of
Labor, such
actuary shall maintain a funding standard account in accordance with rules
and
regulations as from time to time shall be set forth by the Secretary of
Treasury or his
delegate. The status of such funding standard account shall be reported on
an annual basis
to the Administrative Committee and such government agencies as may be
required.
In maintaining the funding standard account, the actuary may rely upon
any
certification or other information relating to employee data, Fund assets and
Contribution
amounts and dates made as provided or caused to be provided to the actuary by
the
Employer, Trustee, independent qualified public accountant or any Fiduciary
to the
extent such reliance is so stated by the actuary in his certification or
report.
7.04 Separate Accounts - The Administrative Committee shall maintain, or
cause to be
maintained, a separate account for each Employer participating in the Plan
showing the
value of its Contributions to, the value of any funds of a Pre-existing Plan
covering its
employees included in, its share of earnings or losses in, and payments
allocable to its
Employees from, the Fund and each separate part of the Fund.
ARTICLE VIII
FIDUCIARIES AND ADMINISTRATION OF THE PLAN
8.01 General - Each Fiduciary who is delegated specific duties or
responsibilities under
the Plan or any Fiduciary who assumes such a position with the Plan shall
discharge his
duties solely in the interest of Participants, Spouses, Surviving Spouses and
Beneficiaries
and for the purpose of providing such benefits as stipulated herein to such
Participants,
Spouses, Surviving Spouses and Beneficiaries. In carrying out such duties
and
responsibilities, each Fiduciary shall act with the care, skill, prudence and
diligence under
the circumstances then prevailing that a prudent man acting in a like
capacity and
familiar with such matters would use in exercising such authority or duties.
A Fiduciary may serve in more than one Fiduciary capacity and may
employ one or
more persons to render advice with regard to his Fiduciary responsibilities.
If a Fiduciary
is serving as such without compensation, all expenses reasonably incurred by
such
Fiduciary shall be reimbursed by the Employer or, at the Corporation's
direction, from the
Fund.
A Fiduciary may delegate any of his responsibilities for the operation
and
administration of the Plan. In limitation of this right, a Fiduciary may not
delegate any
responsibilities as contained herein relating to the management or control of
the Fund
except through the employment of an investment manager as provided in Section
8.03 and
in the Trust Agreement.
8.02 Employer Responsibilities - The Employer established and maintains the
Plan for the
benefit of its Employees and of necessity retains control of the operation
and
administration of the Plan. In accordance with specific provisions of the
Plan, the
Employer has, as herein indicated, delegated certain of these rights and
obligations to the
Corporation, Trustee, Administrative Committee, Compensation and Benefits
Committee
and Investment Policy Committee and these parties shall be responsible solely
for these
delegated rights and obligations.
The Corporation shall cause an annual actuarial valuation of the Plan
to be made,
which will indicate the amount of Contributions necessary to comply with the
minimum
funding standards as may be required by law which report shall be reviewed by
the
Administrative Committee.
The Employer shall indemnify each member of the Board, Administrative
Committee,
Compensation and Benefits Committee, Investment Policy Committee, Trustee and
any
other person to whom any fiduciary responsibility with respect to the Plan is
delegated,
from and against any and all liabilities, costs and expenses incurred by such
persons as a
result of any act or omission to act in connection with the performance of
their fiduciary
duties, responsibilities and obligations under the Plan and ERISA, except for
liabilities
and claims arising from such Fiduciary's willful misconduct or gross
negligence. For this
purpose, the Employer may obtain, pay for and keep current a policy or
policies of
insurance; however, such insurance shall not release the Employer of
liability under this
provision.
The Employer shall supply such full and timely information for all
matters relating to
the Plan as the Administrative Committee, Compensation and Benefits
Committee,
Investment Policy Committee, Trustee, actuary and accountant, if any, engaged
on behalf
of the Plan by the Corporation may require for the effective discharge of
their respective
duties.
8.03 Trustee - The Trustee, in accordance with the Trust Agreement, shall
have exclusive
authority and discretion to manage and control the Fund, except that the
Investment
Policy Committee (who shall be the named Fiduciary for all Employers in
regard to this
appointment) may direct the Trustee or in its discretion may employ at any
time and from
time to time an investment manager [as defined in ERISA Section 3(38)] to
direct the
Trustee with respect to all or a designated portion of the assets comprising
the Fund.
8.04 Administrative Committee - The Compensation and Benefits Committee
shall appoint
an Administrative Committee which shall consist of not less than three (3)
persons to hold
office during the pleasure of the Compensation and Benefits Committee.
Members of the
Administrative Committee may participate in the benefits under the Plan
provided they
are otherwise eligible to do so. No compensation shall be paid from the Fund
to members
of the Administrative Committee for service on such Administrative Committee.
In accordance with the provisions hereof, the Administrative Committee
has been
delegated certain administrative functions relating to the Plan with the duty
and
discretionary authority necessary to enable it properly to carry out such
duties. The
Administrative Committee shall have no power in any way to modify, alter, add
to or
subtract from any provisions of the Plan. The Administrative Committee shall
have the
duty and discretionary authority to carry out the following duties:
8.04(a) To establish and enforce such rules, regulations and
procedures as it shall
deem necessary or proper for the efficient administration of the Plan;
8.04(b) To interpret the Plan, including the supplying of any
omissions in accordance
with the intent of the Plan, its interpretation thereof in good faith to be
final and
conclusive upon all persons;
8.04(c) To decide all questions concerning the Plan and the
eligibility of any
Employee to become a Participant;
8.04(d) To compute the amount of benefits which shall be payable to
any Participant,
retired Participant, or Beneficiary in accordance with the provisions of the
Plan, and to
determine the person or persons to whom such benefits shall be paid;
8.04(e) To authorize or deny the payment of benefits;
8.04(f) To supervise and direct work of Corporation Personnel and
Plan
Representatives, in the administration of the Plan including without
limitation the
following duties:
(i) To prepare and file all reports with Government agencies;
(ii) To prepare and distribute booklets, announcements, reports
and descriptions of
the Plan to Employees, as shall be required by law;
(iii) To maintain all records relating to the Plan and Fund;
(iv) To establish and administer at a local level a uniform claims
procedure;
(v) To perform such other duties as shall be necessary to
administer the Plan.
8.04(g) To review and approve the employment of all accountants,
actuaries,
consultants and attorneys as shall be deemed necessary from time to time, and
to receive
and evaluate their reports;
8.04(h) To review bonding and insurance requirements; and
8.04(i) To delegate in its discretion its powers and duties to
administer the
Plan to personnel of the Corporation; provided, however, that the
discretion vested in
the Administrative Committee shall in all cases be exercised in a manner
which is, so far
as may be practicable, consistent and uniform as to all Employees similarly
situated.
8.05 Compensation and Benefits Committee - The Compensation and Benefits
Committee
shall be designated from time to time by the Board and shall consist of not
less than three
(3) members. Members of the Compensation and Benefits Committee may
participate in
the benefits under the Plan provided they are otherwise eligible to do so.
Except as
otherwise provided by the Board, no member of the Compensation and Benefits
Committee
shall receive any compensation from the Fund for his services on such
Compensation and
Benefits Committee.
In accordance with the provisions hereof, the Compensation and
Benefits Committee
has been delegated certain administrative functions and duties relating to
the Plan with
the duty and discretionary authority necessary to enable it properly to carry
out such
duties. The Compensation and Benefits Committee shall have the duty and
discretionary
authority to carry out the following duties:
8.05(a) To terminate the Plan and/or Trust Agreement or discontinue
contributions;
8.05(b) To amend or modify the Plan or Trust Agreement in whole or in
part;
8.05(c) To appoint Trustees and other Fiduciaries and designate
members of the
Administrative Committee;
8.05(d) To determine the amount of contributions necessary to fund
the Plan on an
actuarially sound basis and to collect and pay all contributions to the Fund
in a timely
manner;
8.05(e) To delegate to employees of the Corporation or to the
Administrative
Committee such additional powers and duties as it shall consider necessary or
desirable in
the operation of the Plan and Fund;
8.05(f) To review periodically all aspects of the administration of
the Plan.
8.06 Investment Policy Committee - A Retirement Plan Investment Policy
Committee of
not less than three (3) persons shall be designated annually by the
Compensation and
Benefits Committee to review the investment of assets in the Fund. Members
of the
Investment Policy Committee may participate in the benefits under the Plan
provided they
are otherwise eligible to do so. Except as otherwise provided by the
Compensation and
Benefits Committee, no member of the Investment Policy Committee shall
receive any
compensation from the Retirement Fund for his services as such.
In accordance with the provisions hereof, the Investment Policy
Committee has been
delegated certain administrative functions and duties relating to the Plan
with the duty
and discretionary authority necessary to enable it properly to carry out such
duties. The
Investment Policy Committee shall have the duty and discretionary authority
to carry out
the following duties:
8.06(a) To develop investment policies and procedures, implement
investment
programs and monitor designated Trustee and investment manager activities;
8.06(b) To employ and discharge investment managers and to recommend
the selection
and/or termination of Trustee or insurance companies;
8.06(c) To receive and evaluate monthly, quarterly and annual reports
of the Trustee
and investment managers;
8.06(d) To review investments made by the Trustee and investment
managers and
other investments held by the Plan;
8.06(e) To direct the flow of funds between trusts and allocate the
amount of assets to
be managed by each Trustee and investment manager;
8.06(f) To report investment performance to the Compensation and
Benefits
Committee at least once each quarter.
8.07 Claims for Benefits - All claims for benefits under the Plan shall be
submitted to the
Administrative Committee through a local Plan representative as appropriate,
who shall
have the responsibility for determining the eligibility of any Participant,
Spouse,
Surviving Spouse or Beneficiary for benefits. All claims for benefits shall
be made in
writing and shall set forth the facts which such Participant, Spouse,
Surviving Spouse or
Beneficiary (the "applicant") believes to be sufficient to entitle him to the
benefit claimed.
The Administrative Committee shall adopt forms for the submission of all
claims for
benefits, and all claims for benefits shall be filed on such forms. The
Administrative
Committee shall provide applicants with all such forms.
The Administrative Committee and the Plan representative shall follow
the following
procedure in processing claims:
8.07(a) Advise the applicant of all his rights under the Plan and
assist him in the
preparation of the claim;
8.07(b) If filed through a Plan representative, the Plan
representative shall forward
the executed claim within thirty (30) days of receipt of the initial
application to the
Administrative Committee for its consideration;
8.07(c) The Administrative Committee shall meet monthly to consider
and take action
on all claims received since it last met;
8.07(d) Upon approval of a claim by the Administrative Committee, a
member of the
Administrative Committee shall take prompt action to commence payment of
benefits to
the applicant in accordance with the provisions of the Plan.
The Administrative Committee shall approve, deny and investigate all
questionable
claims. Upon request, the Administrative Committee shall afford any
applicant the right
of a hearing with respect to any finding of fact or determination related to
any claim for
benefits under the Plan. If any claim for benefits is denied, the applicant
shall be notified
of such decision in accordance with the provisions of Section 8.08.
8.08 Claims Procedures - The applicant shall be notified in writing of any
adverse
decision with respect to his claim within ninety (90) days after its
submission. The notice
shall be written in a manner calculated to be understood by the applicant and
shall
include:
8.08(a) The specific reason or reasons for the denial;
8.08(b) Specific references to the pertinent Plan provisions on which
the denial is
based;
8.08(c) A description of any additional material or information
necessary for the
applicant to perfect the claim and an explanation why such material or
information is
necessary; and
8.08(d) An explanation of the Plan's claim review procedures.
If special circumstances require an extension of time for processing
the initial claim,
a written notice of the extension and the reason therefor shall be furnished
to the
applicant before the end of the initial ninety (90) day period. In no event
shall such
extension exceed ninety (90) days.
If a claim for benefits is denied by the Administrative Committee or
the applicant has
no response to such claim within ninety (90) days of its submission (in which
case the
claim for benefits shall be deemed denied), the applicant or his duly
authorized
representative, at the applicant's sole expense, may appeal the denial to a
panel of three (3)
persons designated by the Compensation and Benefits Committee within sixty
(60) days of
the receipt of written notice of the denial or sixty (60) days from the date
such claim is
deemed denied. The appeal shall be filed in writing with the Administrative
Committee.
In pursuing such appeal, the applicant or his duly authorized representative:
8.08(e) May request in writing that the Administrative Committee
review the denial;
8.08(f) May review pertinent documents; and
8.08(g) May submit issues and comments in writing.
The decision on review shall be made within sixty (60) days of receipt
of the request
for review, unless special circumstances require an extension of time for
processing, in
which case a decision shall be rendered as soon as possible but not later
than one hundred
twenty (120) days after receipt of the request for review. If such an
extension of time is
required, written notice of the extension shall be furnished to the applicant
before the end
of the original sixty (60) day period. The decision on review shall be made
in writing,
shall be written in a manner calculated to be understood by the applicant,
and shall
include specific references to the provisions of the Plan on which the denial
is based.
The applicant shall be entitled to appear before the panel in person
to present his
claim and the panel shall have the authority to obtain such additional
evidence as it deems
appropriate under the circumstances to enable it to render a decision.
The decision of the hearing panel shall be rendered in writing to the
applicant within
seven (7) days of the completion of the hearing and shall be binding upon the
Employer
and the applicant to the extent permitted by law.
8.09 Records - All acts and determinations of the Administrative Committee,
Compensation and Benefits Committee and Investment Policy Committee shall be
duly
recorded, and all such records and other documents as may be necessary in
exercising its
duties under the Plan shall be preserved in the custody of the Administrative
Committee,
Compensation and Benefits Committee and Investment Policy Committee. Such
records
and documents at all times shall be open for inspection to, and for the
purpose of making
copies by, any person designated by the Corporation. The Administrative
Committee,
Compensation and Benefits Committee and Investment Policy Committee shall
provide
such timely information, resulting from the application of its
responsibilities under the
Plan, as needed by the Trustee, actuary and accountant, if any, engaged on
behalf of the
Plan for the effective discharge of their respective duties.
8.10 Missing Persons - The Administrative Committee shall make a reasonable
effort to
locate all persons entitled to benefits under the Plan; however,
notwithstanding any
provision in the Plan to the contrary, if after a period of five (5) years
from the date such
benefit is due, any such person entitled to benefits has not been located,
his rights under
the Plan shall stand suspended. Before this provision becomes operative, the
Administrative Committee shall send a certified letter to such person at his
last known
address advising him that his interest or benefits under the Plan shall be
suspended. Any
such suspended amounts shall be held by the Trustee for a period of three (3)
additional
years (or a total of eight (8) years from the time the benefits first become
payable);
provided, that if a person subsequently makes a valid claim with respect to
such suspended
benefits, his right to benefits shall be reinstated.
ARTICLE IX
MAXIMUM BENEFITS AND REQUIRED
DISTRIBUTION OF BENEFITS
9.01 Maximum Retirement Benefit - Anything herein to the contrary
notwithstanding,
effective for Plan Years commencing on and after January 1, 1987, the
following
provisions shall be applicable:
9.01(a) The monthly retirement benefit payable in the form of a
straight life annuity
from the Plan on behalf of a Participant, when combined with any benefits
from any
other qualified Defined Benefit Plan maintained by the Employer or Affiliate,
shall not
exceed the amount provided in the following paragraphs of this Section 9.01,
as may be
modified by Section 9.02. If the normal form of payment determined under
Section 4.01 is
other than a straight life annuity or a qualified joint and survivor annuity,
the amount
determined hereunder shall be reduced on an Actuarial Equivalent basis to
reflect such
other payment form, with the exception that the interest assumption shall in
no event be
less than five percent (5%).
If a Participant has completed ten (10) or more years of participation
in the Plan, the
maximum monthly benefit payable in accordance with this Section 9.01 shall be
the
smaller of Section 9.01(a)(i) and Section 9.01(a)(ii) following:
(i) Seven thousand five hundred dollars ($7,500), or such greater
amount
determined by the Secretary of Treasury as of January 1 of each calendar
year. Such
amount shall be the maximum monthly amount pursuant to this Section
9.01(a)(i) for that
calendar year and shall apply to the Limitation Year ending with or within
that calendar
year.
(ii) The average monthly compensation the Participant received
from the Employer
during the three (3) consecutive calendar years which would produce the
highest such
average. For purposes of this Section 9.01(a)(ii), "compensation" shall mean
a Participant's
earned income, wages, salaries, fees for professional services and other
amounts received
for personal services actually rendered in the course of employment with an
Employer
maintaining the Plan (including, but not limited to, commissions paid
salesmen,
compensation for services on the basis of a percentage of profits,
commissions on insurance
premiums, tips, bonuses, fringe benefits, reimbursements and expense
allowances) and
excluding the following:
(A) Employer contributions to a plan of deferred compensation to the
extent such
contributions are not included in the gross income of the Employee for the
taxable year in
which contributed, or on behalf of an Employee to a simplified employee
pension plan to
the extent such contributions are deductible under IRC Section 404(h), and
any
distributions from a plan of deferred compensation whether or not includible
in the gross
income of the Employee when distributed.
(B) Amounts realized from the exercise of a non-qualified stock
option, or when
restricted stock (or property) held by an employee becomes freely
transferable or is no
longer subject to a substantial risk of forfeiture;
(C) Amounts realized from the sale, exchange or other disposition of
stock acquired
under a qualified stock option; and
(D) Other amounts which receive special tax benefits, or
contributions made by an
Employer (whether or not under a salary reduction agreement) towards the
purchase of an
IRC Section 403(b) annuity contract (whether or not the contributions are
excludable from
gross income of the Employee).
Compensation for any Limitation Year is the compensation actually paid
or includible
in gross income during the year.
9.01(b) If the payment of a benefit begins before a Participant
attains his Social
Security Retirement Age, the amount set forth in Section 9.01(a)(i) shall be
reduced to the
Actuarial Equivalent of such amount; provided that in no event shall the
interest
assumption be less than five percent (5%).
The adjustments provided for in this section shall be made in a manner
consistent
with the reduction for old age insurance benefits commencing before the
Social Security
Retirement Age under the Social Security Act until age sixty-two (62) is
reached.
9.01(c) If the payment of a benefit begins after a Participant
attains his Social
Security Retirement Age, the amount set forth in Section 9.01(a)(i) shall be
increased to the
Actuarial Equivalent of such amount; provided that in no event shall the
interest
assumption be greater than five percent (5%).
9.01(d) Notwithstanding the preceding provisions of this Section
9.01, the benefits
payable with respect to a Participant under this Plan shall be deemed not to
exceed the
limitations of this Section 9.01 if:
(i) The retirement benefits payable with respect to such
Participant under this
Plan and under all other Defined Benefit Plans to which the Employer
contributes do not
exceed ten thousand dollars ($10,000) for the applicable Plan Year and for
any prior Plan
Year; and
(ii) The Employer has not at any time maintained a Defined
Contribution Plan in
which the Participant participated.
9.01(e) If a Participant has completed less than ten (10) years of
participation in the
Plan, the maximum monthly benefit payable in accordance with Section
9.01(a)(i) shall be
the amount determined under Section 9.01(a)(i) multiplied by a fraction the
numerator of
which is the number of years (or part thereof) of participation in the Plan
and the
denominator of which is ten (10). If a Participant has completed less than
ten (10) years of
Service, the maximum benefit payable in accordance with Section 9.01(a)(ii)
and the ten
thousand dollar ($10,000) limit of Section 9.01(d) shall be the amounts
determined under
such sections multiplied by a fraction the numerator of which is the number
of years (or
part thereof) of Service and the denominator of which is ten (10). However,
in no event
shall the provisions of this Section 9.01(e) reduce the limits of Sections
9.01(a) and 9.01(d)
to an amount less than one-tenth (1/10th) of such limits without the
application of this
Section 9.01(e). To the extent provided in regulations, this Section shall
be applied
separately with respect to each change in the benefit structure of the Plan.
9.01(f) If a Participant is covered by one or more Defined Benefit
Plans maintained
by the Employer, all such plans shall be aggregated in determining whether
the maximum
benefit limitations hereunder have been met. Further, the maximum retirement
benefit as
noted above may be decreased as determined necessary by the Employer to
ensure that all
plans will remain qualified under the IRC. Any such adjustment by the
Employer shall be
communicated in writing to the Committee and the actuary employed on behalf
of the
Plan.
9.01(g) If (i) an Employee is a Participant in this Plan as of the
first day of the first
Plan Year commencing on or after January 1, 1987, (ii) the Plan was in
existence on May 6,
1986, and (iii) the requirements of IRC Section 415 have been met for all
Plan Years, then
to the extent such Participant's "current accrued benefit" exceeds the
limitations otherwise
provided in this Section 9.01, the limitations determined pursuant to Section
9.01(a)(i) for
said Participant shall be equal to his "current accrued benefit" for purposes
of this Section
9.01 and the following Section 9.02.
For purposes of this Section 9.01(g), "current accrued benefit" means
a Participant's
Accrued Benefit as of the last day of the Plan Year prior to the Plan Year to
which this
Section 9.01 applies when expressed as an annual benefit within the meaning
of IRC
Section 415(b)(2) excluding any change in the terms and conditions of the
Plan or cost-of-
living adjustments occurring on and after May 5, 1986.
9.01(h) In the case of a governmental plan within the meaning of IRC
Section 414(d),
or a plan maintained by a not-for-profit organization (other than a
governmental unit), the
following rules shall apply:
(i) The reference to Social Security Retirement Age in Section
9.01(b) shall be
replaced with "age sixty-two (62)" wherever it appears.
(ii) The following sentence shall be added to the end of
Section 9.01(b): "The
reduction under this Section 9.01(b) shall not reduce the limitation under
Section 9.01(a)(i)
below (A) seventy-five thousand dollars ($75,000) if the benefit begins at or
after
attainment of age fifty-five (55), or (B) if the benefit begins before the
attainment of age
fifty-five (55), the Actuarial Equivalent of the seventy-five thousand dollar
($75,000)
limitation for age fifty-five (55)".
(iii) The reference to Social Security Retirement Age in Section
9.01(c) shall be
replaced with "age sixty-five (65)" wherever it appears.
9.02 Multiple Plan Participation - If an Employee is a Participant in one
or more Defined
Benefit Plans and one or more Defined Contribution Plans maintained by the
Employer,
the sum of his Defined Benefit Plan Fraction and his Defined Contribution
Plan Fraction
shall not exceed 1.0 during any Limitation Year.
If the sum of the Defined Benefit Plan Fraction and the Defined
Contribution Plan
Fraction exceeds 1.0 for any Limitation Year, the Employer shall adjust or
freeze the rate
of benefit accrual for purposes of a Defined Benefit Plan or the amount of
"Annual
Additions" [as defined in IRC Section 415(c)(2)] to a Defined Contribution
Plan on behalf
of the Participant so that the sum of such fractions shall not exceed 1.0.
For purposes of maximum Annual Additions to Defined Contribution Plans
and
maximum annual benefits payable from Defined Benefit Plans, all Defined
Contribution
Plans and all Defined Benefit Plans respectively, whether or not terminated,
shall be
combined and treated as one plan.
For purposes of this Section 9.02, the term, "Defined Benefit Plan
Fraction" shall mean
a fraction the numerator of which is the Participant's projected annual
benefit (as defined
in the Defined Benefit Plan) determined as of the close of the Limitation
Year, and the
denominator of which is the lesser of:
9.02(a) The product of 1.25 multiplied by the dollar limitation in
effect in Section
9.01(a)(i) for such Limitation Year; or
9.02(b) The product of 1.4 multiplied by the amount which may be
taken into account
in Section 9.01(a)(ii) with respect to each individual under the Plan for
such Limitation
Year.
The term "Defined Contribution Plan Fraction" shall mean a fraction
the numerator
of which is the sum of all of the Annual Additions to the Participant's
individual account
under the Defined Contribution Plan as of the close of the Limitation Year,
and the
denominator of which is the sum of the lesser of the following amounts
determined for
such Limitation Year, and for each prior Limitation Year of employment with
the
Employer:
9.02(c) The product of 1.25 multiplied by the dollar limitation in
effect pursuant to
IRC Section 415(c)(1)(A) for such year determined without regard to IRC
Section 415(c)(6);
or
9.02(d) The product of 1.4 multiplied by an amount determined
pursuant to IRC
Section 415(c)(1)(B) with respect to each individual under the Plan for such
Limitation
Year.
The limitation on aggregate benefits from a Defined Benefit Plan and
a Defined
Contribution Plan contained in ERISA Section 2004 shall be complied with by
a reduction
(if necessary) in the Participant's benefits under the Defined Benefit Plan
before a
reduction of any such Defined Contribution Plan.
9.03 Required Distribution of Benefits - Unless the Participant otherwise
elects under the
provisions of the Plan, any payment of benefits to the Participant shall
begin not later
than sixty (60) days after the close of the Plan Year in which occurs the
latest of:
9.03(a) The date on which the Participant attains his Normal
Retirement Age;
9.03(b) The tenth (10th) anniversary of the date the Employee becomes
a Participant;
and
9.03(c) The date the Participant terminates his service with the
Employer.
Notwithstanding anything contained herein to the contrary, the entire
interest of each
Participant shall begin to be distributed not later than April 1 of the
calendar year
following the calendar year in which the Participant attains age seventy and
one-half
(70.5) in accordance with IRC Section 401(a)(9) and the regulations issued
thereunder,
inclusive of the minimum distribution incidental benefit requirements of
Section
1.401(a)(9)-2 of the regulations. The spousal benefit requirements under the
Plan shall be
construed and enforced according to the requirements of IRC Sections
401(a)(11) and 417
and ERISA Section 205.
Distributions commencing prior to the death of a Participant may be
made only over
one of the following periods: (a) the life of the Participant, or the joint
lives of the
Participant and his designated Beneficiary, or (b) a period certain not
extending beyond
the life expectancy of the Participant or the joint life expectancy of the
Participant and
his designated Beneficiary.
If the distribution of a Participant's interest has begun and the
Participant dies
before his entire interest has been distributed to him, the remaining portion
of his interest
shall be distributed at least as rapidly as under the method of distribution
in effect at his
date of death.
If a Participant dies prior to the commencement of his benefit, the
distribution of his
entire interest shall be made in accordance with the following.
9.03(d) If the designated Beneficiary is the Spouse of the
Participant, the Beneficiary
may elect to commence the benefit within a reasonable period of time after
the
Participant's death but in no event may such election be made later than (i)
the December
31 of the calendar year immediately following the calendar year in which the
Participant
died or (ii) the December 31 of the calendar year in which the Participant
would have
attained age seventy and one-half (70 1/2). The benefit may be paid over the
life or over a
period certain not extending beyond the life expectancy of the designated
Beneficiary. If
the Spouse dies before the distribution begins, then the five (5) year
distribution
requirement of Section 9.03(f) shall apply as if the Beneficiary were the
Participant.
9.03(e) If the benefit is paid to a designated Beneficiary, as
defined in IRC Section
401(a)(9)(E) inclusive of Section 1.401(a)(9)-1 D-1 and D-2 of the
regulations, other than
the Participant's Spouse, the distribution shall commence no later than
December 31 of the
calendar year immediately following the calendar year in which the
Participant died. The
benefit may be paid over the life or over a period certain not extending
beyond the life
expectancy of the designated Beneficiary.
9.03(f) If there is no designated Beneficiary, as defined in IRC
Section 401(a)(9)
inclusive of Section 1.401(a)(9)-1 D-1 and D-2 of the regulations, at the
death of the
Participant, the distribution of the Participant's entire interest shall be
completed by
December 31 of the calendar year containing the fifth (5th) anniversary of
the
Participant's death.
The benefit payable under the provisions of this Plan may not be paid
in any form
which would violate the required distribution requirements of this Section
9.03.
Life expectancies shall be computed by the use of the expected return
multiples in
Tables V and VI of Section 1.72-9 of the regulations under IRC Section 72.
The life
expectancy of the Participant and Spouse, if applicable, shall be
recalculated annually,
unless the Participant elects otherwise.
ARTICLE X
AMENDMENT AND TERMINATION OF THE PLAN
10.01 Amendment of the Plan - The Compensation and Benefits Committee shall
have the
right at any time by its action to modify, alter or amend the Plan in whole
or in part;
provided, that the duties, powers and liability of the Trustee shall not be
increased
without its written consent; the amount of benefits which at the time of any
such
modification, alteration or amendment have accrued for any Participant,
Spouse,
Surviving Spouse or Beneficiary hereunder shall not be affected adversely
thereby; and no
such amendment shall have the effect of causing a reversion to the Employer
of any part
of the principal or income of the Fund.
No amendment to the Plan shall decrease a Participant's vested Accrued
Benefit or
eliminate an optional form of distribution. If the Plan's vesting schedule
is amended or
the Plan is amended in any way that directly or indirectly affects the
computation of a
Participant's vested benefit or the Plan is deemed amended by an automatic
change to or
from a Top Heavy Plan vesting schedule, each Participant with at least three
(3) Years of
Service may elect within a reasonable period after the adoption of the
amendment or
change, to have his vested percentage computed under the Plan without regard
to such
amendment or change. The period during which the election may be made shall
commence
with the date the amendment is adopted or deemed to be made and shall end on
the latest
of sixty (60) days after (a) the amendment is adopted, (b) the amendment is
effective or (c)
the Participant is issued written notice of the amendment by the Employer,
Administrative
Committee or Compensation and Benefits Committee.
10.02 Termination of the Plan - The Employer expects to continue the Plan
indefinitely,
but continuance is not assumed as a contractual obligation, and each Employer
reserves the
right at any time by action of the Compensation and Benefits Committee to
terminate the
Plan as applicable to itself. If the Employer terminates or partially
terminates the Plan, or
it is otherwise terminated or partially terminated, the rights of the
Participants affected
thereby to benefits then accrued shall be nonforfeitable, and the Trustee
shall continue to
administer the Fund as instructed by the Compensation and Benefits Committee
in
accordance with the provisions hereof. Notwithstanding the above, no
Participant shall
have any recourse toward the satisfaction of his Accrued Benefit other than
from assets of
the Plan or the Pension Benefit Guaranty Corporation (PBGC) if a PBGC
liability is
present.
If the Plan is terminated as provided in this Article X, the
Compensation and Benefits
Committee shall determine the equitable share of the Fund with respect to any
Employer
for whom the Plan has terminated. The administration of that portion of the
Fund
applicable to any Employer for which the Plan has not been terminated shall
be
unaffected, and any references hereinafter contained in this Article X to the
Fund shall
refer only to that portion applicable to the Employer for whom the Plan has
terminated.
The Compensation and Benefits Committee shall allocate and administer
the Fund to
provide benefits for Participants on the date of termination and any Spouses,
Surviving
Spouses or Beneficiaries then receiving benefits in accordance with Article
IV. Such
allocation of the Fund shall be made in the order of precedence and amounts
indicated in
ERISA Section 4044 according to principles set forth in such Section and such
other
portions of ERISA as it incorporates by reference. For the purpose of making
such
allocation, any regulations issued pursuant to such Section shall be deemed
part of such
Section.
The allocation of that portion of the Fund computed above shall be
based on the
method of payment of monthly retirement benefits or death benefits as
specified in the
Plan. If Fund assets on or after the date of termination are insufficient to
fund all
benefits within any class, the benefits of all higher order of precedence
shall be funded,
the benefits of all lower order of precedence shall be unfunded, and the
assets remaining
shall be allocated among members of that class on the basis of their
respective actuarial
reserves, subject to the provisions of ERISA Section 4044.
If upon termination of its participation in the Plan, an Employer
fails to pay or
reimburse the Trustee, actuary, accountant or attorney for the outstanding
charges or
expenses incurred hereunder, the Trustee is empowered to satisfy such claims
by lien upon
that portion of the Fund attributable to such Employer prior to making any
allocation to
Participants, vested terminated Participants, retired Participants, Totally
and Permanently
Disabled Participants, Spouses, Surviving Spouses and Beneficiaries of the
Plan in
accordance with this Article X.
The application of the Fund on the foregoing basis shall be calculated
by the actuary
and certified to the Trustee by the Compensation and Benefits Committee as of
the date on
which the Plan terminated. Subject to the restrictions of ERISA, when the
calculations are
completed, the interest of each Participant, vested terminated Participant,
retired
Participant, Totally and Permanently Disabled Participant, Spouse, Surviving
Spouse and
Beneficiary shall continue to be held in the Fund pursuant to the terms of
this Article X,
or at the direction of the Compensation and Benefits Committee, the
appropriate portion
of the Fund shall be liquidated, and each of their interests shall be
distributed to them in
the form of annuity contracts, annuity payments or installments. Any funds
remaining
after the satisfaction of all liabilities to such Participants, vested
terminated Participants,
retired Participants, Totally and Permanently Disabled Participants, Spouses,
Surviving
Spouses and Beneficiaries under this Plan due to erroneous actuarial
computation or
assumptions shall be returned to the appropriate Employer.
10.03 Twenty-five (25) Highest Paid Limitation - Effective for Plan Years
Beginning
before January 1, 1994 - If the Plan is terminated or a lump sum distribution
is made to a
Participant who is one of the Twenty-five (25) Highest Paid Employees at any
time before
the Expiration Date, the following rules shall apply:
10.03(a) Upon the occurrence of either of the above conditions, the
Basic Benefit and
any Additional Benefit which may be provided from Contributions by the
Employer for
any of its Twenty-five (25) Highest Paid Employees shall not be greater than
the amount
of benefits which can be provided by the larger of the following amounts
prior to the
satisfaction of all Plan liabilities relating to other Plan Participants to
whom this Section
10.03 does not apply:
(i) Twenty thousand dollars ($20,000).
(ii) Twenty percent (20%) of the first fifty thousand dollars
($50,000) of the
Employee's average annual compensation for the preceding five (5) years
multiplied by the
number of years since the Revision Date, as hereinafter defined.
(iii) With respect to a Substantial Owner, the dollar amount which
equals the
Actuarial Equivalent of the benefit guaranteed for such Participant under
ERISA Section
4022, or if the Plan has not terminated, the Actuarial Equivalent of the
benefit that would
be guaranteed if the Plan terminated on the date the benefit commences,
determined in
accordance with regulations of the Pension Benefit Guaranty Corporation
(PBGC), and
with respect to Participants other than Substantial Owners, the dollar amount
which equals
the Actuarial Equivalent of the maximum benefit described in ERISA Section
4022(b)(3)(B) (determined on the date the Plan terminates or on the date
benefits are
distributed, as if the Plan terminated, whichever is earlier and determined
in accordance
with PBGC regulations) without regard to any other limitation in ERISA
Section 4022.
10.03(b) The provisions of Section 10.03(a) shall not restrict the
current payment of
full retirement benefits called for by the Plan for any retired Employee
while the Plan is
in full effect. If any funds are realized by operation of the restrictions
set forth in
Section 10.03(a), they shall be used to reduce subsequent Contributions by
the Employer, or
if the Employer has ceased its Contributions, they shall be used for the
benefit of
Employees other than those restricted by Section 10.03(a) on a basis which
shall not result
in substantial discrimination in favor of the more highly-compensated
Employees, subject
to any reversion of assets on Plan termination pursuant to Section 10.02.
10.03(c) For purposes of this Section 10.03, the following
definitions shall apply:
(i) Additional Benefits - the benefits provided by the Plan
which are over and
above those which would have been provided by the provisions of the Plan in
effect prior
to the applicable Revision Date had the Plan been continued without change;
(ii) Basic Benefit - the benefit initially provided by the Plan
less any Additional
Benefits;
(iii) Expiration Date - the tenth (10th) anniversary of any
Revision Date;
(iv) Revision Date - the effective date of adoption of the Plan
by the Employer or
the effective date of any amendment to the Plan which increases the benefits;
(v) Substantial Owner - a Participant defined in ERISA Section
4022(b)(5); and
(vi) Twenty-five (25) Highest Paid Employees - the twenty-five
(25) highest paid
Employees of the Employer as of the applicable Revision Date, excluding, any
Employee
whose anticipated annual benefits are not expected to exceed fifteen hundred
dollars
($1,500).
10.03(d) If during the first ten (10) years after a Revision Date,
any benefit is to be
distributed in a lump sum (the amount of which represents the lump sum
Actuarial
Equivalent of the retirement benefit to which the Participant otherwise would
be entitled
to receive as the normal form of pension) to a Participant to whom this
Section 10.03
applies, prior to the payment of such lump sum, the Participant shall enter
into an
agreement with the Employer. This agreement shall be in accordance with
requirements
prescribed by the Administrative Committee and/or Compensation and Benefits
Committee, Revenue Ruling 92-76 and any rulings or regulations amendatory
thereof,
including provisions that the Participant (or in the event of his death, his
estate) will
repay to the Fund a sum, as determined by the actuary, equal to the Actuarial
Equivalent
of the amounts by which the Participant's monthly retirement benefit under
the Plan
would have been decreased during his then remaining lifetime in accordance
with this
Section 10.03, and secure such obligation to repay if the limitations
contained in this
Section 10.03 become effective. The agreement shall require the Participant,
promptly
after the distribution to him of the lump sum payment under the Plan, to
deposit as
security with a depository satisfactory to the Employer and the
Administrative Committee
or Compensation and Benefits Committee real or personal property with a fair
market
value, as determined by the depository, as of the date of deposit equal to at
least one
hundred twenty-five percent (125%) of the amount that would be repayable had
the Plan
terminated on the date of distribution of such lump sum. If the fair market
value, as
determined by the depository, of such property falls below one hundred ten
percent (110%)
of the amount that would have been repayable to the Fund, the Participant
shall deposit
with the depository additional properties so as to render the total fair
market value, as
determined by the depository, of the security deposited equal to one hundred
twenty-five
percent (125%) of the amount which would have been repayable as determined by
the
actuary. If the conditions of this Section 10.03(d) are met for the ten (10)
year period
following such Revision Date, and the Plan is not terminated, the property
deposited as
security in the Fund shall be redelivered to the Participant.
10.03(e) The provisions of this Section 10.03 shall apply to former
or retired
Participants as well as to Participants in active service.
10.03(f) If it is determined by statute, court decision in which the
Internal Revenue
Service acquiesces, ruling by the Internal Revenue Service or otherwise that
the provisions
of this Section 10.03 no longer are necessary to qualify the Plan under the
IRC, this
Section 10.03 shall be ineffective without amendment to the Plan.
10.04 Restriction on Benefits for Top Twenty-five (25) Highly Compensated
Employees -
Effective for Plan Years Commencing on and After January 1, 1994 - The
benefit of any
active or former Highly Compensated Employee shall be limited to a benefit
that is
nondiscriminatory under IRC Regulation 1.401(a)(4)-5(b).
Benefits distributed to any of the twenty-five (25) active or former
most Highly
Compensated Employees shall be restricted so that the annual payments are no
greater than
an amount equal to the payment that would be made on behalf of such Highly
Compensated Employee under a single life annuity that is the Actuarial
Equivalent of the
sum of such Highly Compensated Employee's Accrued Benefit and any other
benefits
under the Plan.
The preceding paragraph shall not apply if: (a) after payment of the
benefit to such
Highly Compensated Employee, the value of Plan assets equals or exceeds one
hundred ten
percent (110%) of the value of current liabilities as defined in IRC Section
412(l)(7), (b)
the value of the benefits for such Highly Compensated Employee is less than
one percent
(1%) of the value of current liabilities, or (c) the value of the benefits
payable to such
Highly Compensated Employee does not exceed three thousand five hundred
dollars
($3,500) or such other amount as may be designated in IRC Section
411(a)(11)(A).
For purposes of this Section 10.04, "benefit" includes any loan in
excess of the amount
set forth in IRC Section 72(p)(2)(A), any periodic income, any withdrawal
value payable to
a living employee or former employee, and any death benefit not provided for
by
insurance on the life of the employee or the former employee.
Notwithstanding the preceding, distributions of amounts in excess of
the limits
provided under IRC Regulation 1.401(a)(4)-5(b)(3)(i) are permitted, provided
that an
agreement between the Highly Compensated Employee and the Employer has been
established to secure repayment to the Fund of any amount necessary for the
distribution
of assets upon the termination of the Plan to satisfy IRC Section 401(a)(4).
During any Plan Year, the amount that may be required to be repaid to
the Fund is
the Restricted Amount. For purposes of this Section 10.04, the Restricted
Amount is the
excess of the Accumulated Amount of distributions made to the Highly
Compensated
Employee over the Accumulated Amount of the Highly Compensated Employee's
nonrestricted limit. The nonrestricted limit is equal to the payments that
could have been
distributed to the Highly Compensated Employee, commencing when distribution
commenced, had the Highly Compensated Employee received payments in the form
described in IRC Regulations 1.401(a)(4)-5(b)(3)(i)(A) and (B). For purposes
of this Section
10.04, Accumulated Amount is the amount of a payment increased by a
reasonable amount
of interest from the date the payment was made (or would have been made)
until the date
of the determination of the Restricted Amount.
In order to secure the repayment obligation of the Restricted Amount,
prior to the
payment of such distribution, the Highly Compensated Employee shall enter
into an
agreement with the Employer. The agreement shall require the Highly
Compensated
Employee, promptly upon such distribution, to deposit in escrow as security
with an
acceptable depository having a fair market value equal to at least one
hundred twenty-five
(125%) of the Restricted Amount. The obligation of the Highly Compensated
Employee
under the repayment agreement alternatively can be secured or collateralized
by posting a
bond equal to at least one hundred percent (100%) of the Restricted Amount.
For this
purpose, the bond must be furnished by an insurance company, bonding company
or other
surety approved by the U.S. Treasury Department as an acceptable surety for
federal
bonds. A Highly Compensated Employee's obligation under the repayment
agreement can
be secured by a bank letter of credit in an amount equal to at least one
hundred percent
(100%) of the Restricted Amount.
Amounts in the escrow account exceeding one hundred twenty-five
percent (125%) of
the Restricted Amount may be withdrawn for the Highly Compensated Employee.
Similar
rules apply to the release of any liability in excess of one hundred percent
(100%) of the
Restricted Amount where the repayment obligation has been secured by a bond
or a letter
of credit. If the fair market value of the property in the escrow account
falls below one
hundred ten percent (110%) of the Restricted Amount, the Highly Compensated
Employee
shall deposit additional property so as to render the fair market value of
the property held
by the depository equal to one hundred twenty-five percent (125%) of the
Restricted
Amount. The Highly Compensated Employee has the right to receive any income
from the
property placed in escrow, subject to the obligation to maintain the value of
the property
as described.
A depository may not redeliver to a Highly Compensated Employee any
property held
under such an agreement, other than amounts in excess of one hundred
twenty-five
percent (125%) of the Restricted Amount, and a surety or bank may not release
any
liability on a bond or letter of credit unless the Administrative Committee
and/or the
Compensation and Benefits Committee certifies to the depository, surety or
bank that the
Highly Compensated Employee (or his estate) is no longer obligated to repay
any amount
under the agreement. The Administrative Committee and/or the Compensation
and
Benefits Committee will make such a certification if at any time after the
distribution
commences, any of the provisions of this Section 10.04(a), (b) or (c) are
met, or if the Plan
has terminated and the benefit received by the Highly Compensated Employee is
nondiscriminatory. Such a certification by the Administrative Committee
and/or the
Compensation and Benefits Committee terminates the agreement between the
Highly
Compensated Employee and the Employer.
ARTICLE XI
PROVISIONS RELATIVE TO EMPLOYERS INCLUDED IN PLAN
11.01 Method of Participation - Any organization which is a member of the
same
controlled group of organizations as the Corporation, as determined pursuant
to IRC
Sections 414(b), (c), (m) and (o), with the approval of the Compensation and
Benefits
Committee, may become a party to the Plan, by adopting the Plan as a
retirement plan for
its Employees. Any organization which becomes a party to the Plan promptly
shall deliver
to the Trustee provided for in Article VII a certified copy of the
resolutions or other
documents evidencing its adoption of the Plan and a written instrument
showing the
Compensation and Benefits Committee's approval of the organization becoming
a party to
the Plan.
11.02 Withdrawal from Participation - Any one or more of the Employers
included in the
Plan may withdraw from the Plan at any time by giving six (6) months advance
notice in
writing of its or their intention to withdraw to the Compensation and
Benefits Committee
(unless a shorter notice is agreed to by the Compensation and Benefits
Committee).
Upon receipt of notice of any such withdrawal, the Compensation and
Benefits
Committee shall certify to the Trustee the equitable share of such
withdrawing Employer
in the Fund (to be determined by the actuary employed on behalf of the Plan
by the
Corporation). The Trustee thereupon shall set aside from the Fund then held
by it such
securities and other property as it, in its sole discretion, shall deem to be
equal in value to
such equitable share. If the Plan is to be terminated with respect to such
Employer, the
amount set aside shall be dealt with in accordance with the provisions of
Section 10.02. If
the Plan is not to be terminated with respect to such Employer, the Trustee
shall turn over
such amount to the trustee designated by such Employer, and such securities
and other
property thereafter shall be held and invested as a separate retirement trust
of such
Employer, and shall be used and applied according to the terms of a new
agreement and
declaration of trust between the withdrawn Employer and the trustee.
Neither the segregation of the Fund assets upon the withdrawal of an
Employer nor
the execution of a new agreement and declaration of trust pursuant to any of
the
provisions of this Section 11.02 shall operate to permit any part of the
corpus or income of
the Fund to be used for or diverted to purposes other than for the exclusive
benefit of
Participants, Spouses, Surviving Spouses and Beneficiaries, except as
otherwise may be
provided in Sections 10.02, 13.08 and 13.10.
ARTICLE XII
TOP HEAVY PLAN PROVISIONS
12.01 General - Notwithstanding anything contained herein to the contrary,
if the Plan,
when combined with all other plans required to be aggregated pursuant to IRC
Section
416(g), is deemed to be a Top Heavy Plan for any Plan Year, the following
conditions shall
become operative.
12.02 Minimum Benefits - For the first Plan Year commencing on or after
January 1,
1984, that the Plan is deemed a Top Heavy Plan, and any Plan Year thereafter
in which
the Plan is a Top Heavy Plan, a minimum annual Accrued Benefit applicable to
all Non-
Key Employees who are Participants equal to the lesser of two percent (2%) of
Top Heavy
Compensation multiplied by the Participant's number of years of Top Heavy
Service or
twenty percent (20%) of his Top Heavy Compensation shall be provided.
12.03 Definitions -
12.03(a) Determination Date means the last day of the preceding Plan
Year. For the
first Plan Year that a Plan is in effect, Determination Date means the last
day of such
Plan Year
12.03(b) Key Employee means any employee, former employee or
beneficiary of a
former employee in a plan of the Employer or Affiliate who at any time during
the Plan
Year or any of the four (4) preceding Plan Years is:
(i) An officer of the Employer or Affiliate having annual
compensation greater
than fifty percent (50%) of the amount in effect under IRC Section
415(b)(1)(A) for any
such Plan Year;
(ii) One (1) of the ten (10) employees having annual compensation
from the
Employer or Affiliate of more than the limitation in effect under IRC Section
415(c)(1)(A)
and owning (or considered as owning within the meaning of IRC Section 318)
more than a
one-half percent (1/2%) interest and the largest interest in the Employer or
Affiliate;
(iii) A five percent (5%) owner of the Employer or Affiliate; or
(iv) A one percent (1%) owner of the Employer or Affiliate having
annual
compensation from the Employer or Affiliate of more than one hundred fifty
thousand
dollars ($150,000).
For purposes of Section 12.03(b)(i), no more than fifty (50) employees
[or, if lesser, the
greater of three (3) or ten percent (10%) of employees] shall be treated as
officers.
Further, for purposes of determining the number of officers taken into
account under
Section 12.03(b)(i), employees described in IRC Section 414(q)(8) shall be
excluded.
With respect to Section 12.03(b)(ii), if two (2) Employees have the
same ownership
interest in the Employer or Affiliate, the Employee having the greater annual
compensation from the Employer or Affiliate shall be treated as having a
larger interest.
For purposes of this Section 12.03, "compensation" shall have the same
meaning as in
IRC Section 414(q)(7).
12.03(c) Non-Key Employee means an employee, former employee or
beneficiary of a
former employee who is not a Key Employee.
12.03(d) Top Heavy Plan means on or after January 1, 1984, any plan
under which as
of any Determination Date the present value of the cumulative accrued
benefits for Key
Employees exceed sixty percent (60%) of the present value of the cumulative
accrued
benefits for all Employees.
For purposes of this definition:
(i) If the plan is a Defined Benefit Plan, the present value of
cumulative accrued
benefits shall be the lump sum present value of a participant's accrued
benefit under the
Plan calculated on the basis of interest and mortality set forth in the plan
as of the Top
Heaving Valuation Date plus contributions due under the plan as of the
Determination
Date. If the plan is a Defined Contribution Plan, the present value of
cumulative accrued
benefits shall be deemed to be the market value of all Employee accounts
under the plan as
of the Top Heavy Valuation Date plus contributions made to the plan as of the
Determination Date. Notwithstanding the preceding, for purposes of
determining the
present value of the cumulative accrued benefits, distributions made within
a five (5) year
period ending on the Determination Date shall be included. The account
balances and
accrued benefits of a Non-Key Employee who was previously a Key Employee
shall be
excluded from these computations.
(ii) Each plan of the Employer required to be included in an
"aggregation group"
shall be treated as a Top Heavy Plan if such group is a top heavy group.
(iii) The term "aggregation group" means
(A) each plan of the Employer or Affiliate that is currently
effective or which has
terminated within the five (5) year period ending on the Determination Date
in which a
Key Employee is a Participant during the Plan Year containing the year of
determination
or any of the four (4) preceding Plan Years;
(B) each other plan of the Employer or Affiliate which enables any
plan in (A) to
meet the requirements of IRC Section 401(a)(4) or 410.
A permissive aggregation group consists of plans of the Employer or
Affiliate that are
required to be aggregated, plus one (1) or more plans of the Employer or
Affiliate that are
not part of a required aggregation group but satisfy the requirements of IRC
Sections
401(a)(4) and 410 when considered together with the required aggregation
group.
(iv) If any individual has not performed any service for the
Employer or Affiliate
at any time during the five (5) year period ending on the Determination Date,
any accrued
benefit for such individual shall not be taken into account in the testing
procedure herein
described.
12.03(e) Top Heavy Compensation means a Participant's average annual
Full
Compensation during that period of five (5) consecutive Testing Years for
which his
aggregate Full Compensation was the greatest. If he has fewer than five (5)
consecutive
Testing Years, his Top Heavy Compensation shall mean his average annual Full
Compensation during that period containing the largest number of consecutive
Testing
Years; provided, that if there is more than one such period, Top Heavy
Compensation shall
be calculated on the basis of such period for which such average is the
greatest.
12.03(f) Testing Year means a Plan Year which (i) constitutes a year
of Service for
such Participant, and (ii) begins prior to the end of the last Plan Year for
which the Plan
was a Top Heavy Plan. Except to the extent excluded under the preceding
sentence, Plan
Years beginning before 1984 shall be Testing Years.
12.03(g) Full Compensation means, for any Employee for any Plan Year,
his
compensation [as such term is defined in Section 9.01(a)(ii)] from the
Employer or
Affiliate for such Plan Year, except that Full Compensation for any Plan Year
shall not
exceed two hundred thousand dollars ($200,000) or such greater amount as may
be
determined by the Secretary of Treasury pursuant to IRC Section 401(a)(17).
12.03(h) Top Heavy Service means a year of Credited Service in which
the Plan is
deemed to be a Top Heavy Plan with the exception that Credited Service prior
to January
1, 1984, shall be excluded.
12.03(i) Top Heavy Valuation Date means the most recent valuation
date that falls
within or ends with the twelve (12) month period ending on the Determination
Date. If
the plan is a Defined Benefit Plan, the valuation date must be the same
valuation date
used for computing plans costs for minimum funding regardless of whether a
valuation is
performed that year.
These definitions shall be interpreted consistent with IRC Section 416
and rules and
regulations issued thereunder. Further, such law and regulations shall be
controlling in all
determinations under these definitions, inclusive of any provisions and
requirements
stated thereunder but hereinabove absent.
12.04 Multiple Plan Participation - If the Plan is deemed to be a Top Heavy
Plan for the
Plan Year, then the multiplier of 1.25 in Sections 9.02(a) and 9.02(c) shall
be reduced to 1.0
unless:
12.04(a) All plans required to be aggregated and any other plans
which may be
permissively aggregated pursuant to IRC Section 416(g) are ninety percent
(90%) or less top
heavy; and
12.04(b) The minimum accrued benefit referenced in IRC Section
416(c)(1) and
Section 12.02 is modified by substituting three percent (3%) for two percent
(2%) and
increasing twenty percent (20%) by one (1) percentage point for each year of
Top Heavy
Service (but not by more than ten (10) percentage points).
12.05 No Duplication of Minimum Benefit - These Top Heavy Plan provisions
shall not
require that the entire defined benefit minimum benefit and defined
contribution
minimum contribution be provided. To the extent that there is a Defined
Benefit Plan
accrued benefit, it shall be controlling. To the extent that there is an
Employer
contribution to a Defined Contribution Plan, then there shall be a
determination as to
whether the Defined Contribution Plan amount is comparable to the difference
between
the Defined Benefit Plan minimum benefit and the minimum Defined Benefit Plan
accrued benefit required under IRC Section 416. If the Defined Contribution
Plan amount
is not comparable, then the difference shall be provided in the Defined
Benefit Plan.
12.06 Actuarial Assumptions - For purposes of determining whether a Defined
Benefit
Plan is a Top Heavy Plan, calculations shall be based on the Actuarial
Equivalent factors
with such determination made as of the Top Heavy Valuation Date. If more
than one (1)
plan is being used for Top Heavy Plan testing, the same actuarial assumptions
shall be used
for all such plans. Further, pursuant to Internal Revenue Service Regulation
1.416-1, T-26
and T-27, proportional subsidies shall be ignored, and non-proportional
subsidies shall be
considered.
12.07 Vesting - If the vesting schedule provided in Section 5.01 is less
liberal than the
vesting schedule hereinafter provided, then the following vesting schedule
shall apply for
each Participant with an Hour of Service after the Plan becomes a Top Heavy
Plan. This
schedule shall remain in effect in all future Plan Years.
Vested
Years of Vesting Service Percentage
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%
ARTICLE XIII
MISCELLANEOUS
13.01 Governing Law - The Plan shall be construed, regulated and
administered
according to the laws of the Commonwealth of Virginia except in those areas
preempted
by the laws of the United States of America.
13.02 Construction - The headings and subheadings in the Plan have been
inserted for
convenience of reference only and shall not affect the construction of the
provisions
hereof. In any necessary construction, the masculine shall include the
feminine and the
singular the plural, and vice versa.
13.03 No Employment Contract - This Plan shall not be deemed to constitute
a contract
between the Employer and any Participant or to be a consideration or
inducement for the
employment of any Participant or employee. No Participant shall acquire any
right to be
retained in the Employer's employ by virtue of the Plan, nor upon his
dismissal or
voluntary termination of employment, shall he have any right or interest in
and to the
Fund other than as specifically provided herein. Except to the extent
required by law, the
Employer shall not be liable for the payment of any benefit provided for
herein; all
benefits hereunder shall be payable only from the Fund and only to the extent
that the
Fund is sufficient therefor.
13.04 Receipt Prior to Payment - The Trustee, Administrative Committee or
Employer,
jointly or severally, may, but need not, require a written receipt as a
condition precedent
to any payment called for by the Plan to be made to a Participant, Spouse,
Surviving
Spouse, Beneficiary, or to their heirs, successors, executors and legal
representatives.
13.05 Payments to Minors and Incompetents - If any Participant, Spouse,
Surviving Spouse
or Beneficiary is a minor or in the judgment of the Administrative Committee
is
physically or mentally incapable of personally receiving and giving a valid
receipt for any
payment due him under the Plan, the Committee may make such payment or any
part
thereof to or for the benefit of such Participant, Spouse, Surviving Spouse
or Beneficiary,
or directly to or for the benefit of any person determined by the Committee
to have
incurred expense or assumed responsibility for the expenses of such
Participant,
Spouse, Surviving Spouse or Beneficiary.
13.06 Non-alienability of Benefits - Except as provided in IRC Section
401(a)(13)(B)
related to qualified domestic relations orders as defined in IRC Section
414(p), no benefits
or other amounts payable under the Plan shall be subject in any manner to
anticipation,
sale, transfer, assignment, pledge, encumbrance, charge or alienation.
Notwithstanding
anything contained herein to the contrary, if a benefit is being paid or is
to be paid
pursuant to a Domestic Relations Order entered into prior to January 1, 1985,
such order
shall be considered to be a Qualified Domestic Relations Order. If the
Administrative
Committee determines that any person entitled to any payments under the Plan
has become
insolvent or bankrupt or has attempted to anticipate, sell, transfer, assign,
pledge,
encumber, charge or otherwise in any manner alienate any benefit or other
amount
payable to him under the Plan, or that there is any danger of any levy or
attachment or
other court process or encumbrance on the part of any creditor of such person
entitled to
payments under the Plan against any benefit or other amounts payable to such
person, the
Administrative Committee, at any time, in its discretion, may direct the
Trustee to
withhold any or all payments to such person under the Plan and apply the same
for the
benefit of such person in such manner and proportion as the Administrative
Committee
may deem proper. Notwithstanding anything contained herein to the contrary,
with
respect to a debt due by the Participant to the Employer, a Participant,
Spouse, Surviving
Spouse or Beneficiary in pay status may assign or alienate rights to future
benefit
payments provided that any such assignment or alienation (a) is voluntary and
revocable,
(b) does not exceed ten percent (10%) of any benefit payment, and (c) is
neither for the
purpose, nor has the effect, of defraying Plan administrative costs. The
Employer also
shall file a written acknowledgement with the Committee within ninety (90)
days of the
assignment that the Employer has no enforceable right in, or to, any part of
a benefit
payment under the Plan except as may be assigned under this Section.
Notwithstanding anything contained herein to the contrary, upon the
receipt by the
Plan of a Domestic Relations Order, the following provisions of this Section
13.06 shall
become effective.
13.06(a) Determination of Qualified Domestic Relations Order - Upon
receipt by the
Plan of a Domestic Relations Order, the Administrative Committee shall
promptly notify
the Participant and any Alternate Payee of such receipt and the Plan's
procedures for
determining if such order is a Qualified Domestic Relations Order. Within a
reasonable
time thereafter in accordance with reasonable procedures established by the
Administrative Committee, the Administrative Committee shall determine
whether such
order is a Qualified Domestic Relations Order and notify the Participant and
Alternate
Payee of such determination. During the period of time in which the
Administrative
Committee is making the determination of whether the Domestic Relations Order
is a
Qualified Domestic Relations Order, the Committee shall segregate in a
separate account
in the Plan or in an escrow account the amount or amounts which would have
been
payable to the Alternate Payee during such period if the order had been
determined to be
a Qualified Domestic Relations Order.
In the case of any payment before a Participant has separated from
service with the
Employer, a Domestic Relations Order shall be a Qualified Domestic Relations
Order
regardless of the fact that such order requires that payment of benefits be
made to an
Alternate Payee:
(i) on or after the date on which the Participant attains or first
would have
attained his Early Retirement Date;
(ii) as if the Participant had retired on the date on which such
payment is to begin
under such order taking into account only the present value of the benefits
actually
accrued and not taking into account the present value of any Employer subsidy
for early
retirement based on the interest rate specified in the Plan or, if no rate is
specified, five
percent (5%); and
(iii) in any form in which such benefits may be paid under the Plan
to the
Participant (other than in the form of a joint and survivor annuity with
respect to the
Alternate Payee and his or her subsequent spouse).
13.06(b) Payment to Alternate Payee - If, within eighteen (18)
months, the Domestic
Relations Order is determined to be a Qualified Domestic Relations Order, the
Administrative Committee shall pay the segregated amounts to the person or
persons
entitled thereto.
If, within eighteen (18) months, it is determined that the order is
not a Qualified
Domestic Relations Order, or the issue as to whether such order is a
Qualified Domestic
Relations Order is not resolved, then the Administrative Committee shall pay
the
segregated amount to the person who would have been entitled to such amounts
as if there
had been no order.
Any determination that an order is a Qualified Domestic Relations
Order which is
made after the close of the eighteen (18) month period shall be applied
prospectively only.
13.06(c) Definitions - For purposes of this Section 13.06, the
following definitions
shall apply:
(i) Alternate Payee means any spouse, child or other dependent
of a Participant
who is recognized by a Domestic Relations Order as having a right to receive
all, or a
portion of, the benefits payable under a Plan with respect to such
Participant.
(ii) Domestic Relations Order - Any judgment, decree or order
(including approval
of a property settlement agreement) which
(A) relates to the provisions of child support, alimony payments, or
marital property
rights to a spouse, child or other dependent of a Participant, and
(B) is made pursuant to a state domestic relations law (including a
community
property law).
(iii) Qualified Domestic Relations Order - A Domestic Relations
Order which
creates or recognizes the existence of an Alternate Payee's right to, or
assigns to an
Alternate Payee the right to, receive all or a portion of the benefits
payable with respect to
a Participant under the Plan; provided that such Domestic Relations Order
clearly
specifies:
(A) the name and last known mailing address (if any) of the
Participant and the
name and mailing address of each Alternate Payee covered by the order;
(B) the amount or percentage of the Participant's benefit to be paid
by the Plan to
each Alternate Payee or the manner in which such amount or percentage is to
be
determined;
(C) the number of payments or period to which such order applies;
and
(D) each plan to which such order applies.
A Domestic Relations Order meets the requirements of this subsection
only if such
order does not require the Plan:
(E) to provide any type or form of benefits, or any optional payment
form, not
otherwise provided under the Plan;
(F) to provide increased benefits (determined on the basis of
Actuarial Equivalent
value); and
(G) to make payment of benefits to an Alternate Payee which are
required to be paid
to another Alternate Payee under another order previously determined to be a
Qualified
Domestic Relations Order.
13.06(d) Establishment of Plan Procedures - For purposes of this
Section 13.06,
reasonable procedures shall be established under the Plan to determine the
qualified status
of Domestic Relations Orders and to administer distributions under Qualified
Domestic
Relations Orders. The procedures established by the Plan shall:
(i) be set forth in writing;
(ii) provide for the notification of each person specified in a
Domestic Relations
Order as entitled to payment of benefits under the Plan (at the address
included in the
Domestic Relations Order) of such procedures promptly upon receipt by the
Plan of the
Domestic Relations Order; and
(iii) permit an Alternate Payee to designate a representative for
receipt of copies of
notices that are sent to the Alternate Payee with respect to a Domestic
Relations Order.
13.07 Effect of Corporate Reorganization - In the event that the
Corporation shall
become a party to any reorganization, merger, consolidation or other
corporate
readjustment, or shall be dissolved or liquidated, and, as a result thereof,
a substantial part
of the Employees of the Corporation shall become the employees of another
corporation,
then this Plan shall not be terminated or discontinued in whole or in part as
to such
Corporation, and such other corporation or corporations shall, in all
respects, be
substituted for such Corporation under this Plan.
In the event that any entity other than the Corporation shall acquire
a majority of the
outstanding voting stock of the Corporation, or all or substantially all of
the assets of the
Corporation, or any plant, division or department thereof as a going concern,
then, the
Corporation, as determined by the Compensation and Benefits Committee, may,
in lieu of
the normal operation of Article V or Section 10.02, cause any part of the
Fund, as
determined by the Administrative Committee upon the advice of the actuary,
which is
allocable to (a) Participants who thereupon become employed, directly or
indirectly, by the
acquirer and (b) the Beneficiaries of such Participants, to be segregated and
deposited in a
separate fund, which shall thereafter be held subject to this Plan and, in
such event, the
acquirer shall be vested with all of the powers vested in the Board with
respect to this Plan
as it relates to the acquirer's employees. In such case, this Plan shall not
be terminated or
discontinued in whole or in part. Alternatively, the Compensation and
Benefits Committee
may terminate this Plan as to such acquired corporation, plant, division or
department, in
which case the allocable part of the Fund shall be segregated as provided
above and
applied as provided in Section 10.02.
In the event that any Employer shall be involved in a merger,
consolidation,
acquisition, reorganization, liquidation, transfer of assets to another plan
or similar
transaction, the Accrued Benefits earned by a Participant prior to the
transaction shall not
be reduced and shall be equal to or greater than the benefit to which he
would have been
entitled to receive on a termination basis before the transaction.
13.08 Mistake of Fact - Notwithstanding anything herein to the contrary,
there shall be
returned to the Employer any Contribution which was made as follows:
13.08(a) By a mistake of fact, as determined by the Internal Revenue
Service or in
such other manner as the Internal Revenue Service may permit;
13.08(b) Prior to the receipt of initial qualification if the Plan
received an adverse
determination with respect to its initial qualification, and the application
for
determination of initial qualification was made by the time prescribed by law
for filing
the Employer's tax return for the taxable year in which the Plan was adopted,
or such later
date as the Secretary of Treasury may prescribe; or
13.08(c) In an amount that exceeded the deductible limits on such
Contribution as set
forth under IRC Section 404, as determined by the Internal Revenue Service or
in such
other manner as the Internal Revenue Service may permit.
The return of any Contribution as hereinbefore provided shall be made
within one (1)
year after the payment of the Contribution, denial of the initial
qualification or
disallowance of the deduction (to the extent disallowed), whichever is
applicable. Any
Contribution returned due to mistake of fact under Section 13.08(a) or
disallowance of a
tax deduction under Section 13.08(c) shall be reduced by its share of the
losses and
expenses of the Fund but shall not be increased by income or gains of the
Fund. Any
Contribution returned to the Employer due to denial of initial qualification
under Section
13.08(b) shall be equal to the entire assets of the Plan attributable to
Contributions by the
Employer.
13.09 Exclusive Benefit - The Employer shall not be entitled to any part of
the corpus or
income of the Fund, and no part thereof shall be used for or diverted to
purposes other
than for the exclusive benefit of Participants, Spouses, Surviving Spouses
and
Beneficiaries hereunder except as provided in Sections 13.08 and 13.10.
13.10 Expenses - The operating expenses of the Plan and Fund shall be paid
by the
Employer or, upon the direction of the Corporation, may be paid from the Fund
to the
extent such expenses are permitted to be charged against the Fund. The
determination of
whether expenses may be charged against the Fund shall be made by the
Corporation.
13.11 Indemnification - The Employer shall indemnify and hold harmless each
person or
persons who may serve on the Administrative Committee, Compensation and
Benefits
Committee or Investment Policy Committee from any and all claims, loss,
damages,
expenses (including attorney's fees) and liability (including any amounts
paid in
settlement) arising from any act or omission of such person or persons,
except when the
same is judicially determined to be due to the gross negligence or willful
misconduct of
such person or persons. No Plan assets may be used for any such
indemnification.
13.12 Small Payments - If the retirement benefit payable to a Participant
at retirement is
less than twenty-five dollars ($25.00) per month, the Participant may elect
in writing that
such benefit payments be made on a quarterly, semi-annual or annual basis.
13.13 Counterparts - The Plan and the Trust Agreement may be executed in
any number
of counterparts, each of which shall constitute but one and the same
instrument and may
be sufficiently evidenced by any one counterpart.
13.14 Effect of Bargaining Agreement - In the event that a bargaining
representative of
any Participant negotiates an agreement for another retirement plan as to
such Participant,
such Participant shall, upon his inclusion in such Plan, be deemed to have
terminated his
service under this Plan.
ARTICLE XIV
CERTAIN TRANSITIONAL RULES
14.01 Background - This Plan was adopted by the Corporation effective
November 28,
1979 as a continuation of the Stanley Retirement Plan for former employees of
the Stanley
Furniture Company Division of The Mead Corporation who became Employees of
the
Corporation upon the acquisition by the Corporation of the assets of the
Stanley Furniture
Division on November 28, 1979. It is the intent of the following
transitional rules to
ensure that this Plan be interpreted as assuring the uninterrupted
continuation of the
provisions of the Stanley Retirement Plan for Employees of the Corporation
who were or
would have been eligible to participate in the Plan before the acquisition,
with no loss of
service credit for purposes of participation, vesting, benefit accrual, or
any other purpose.
Nevertheless, the Corporation reserves the right to amend this Plan as
provided herein so
long as no such amendment adversely affects benefits accrued by such
Employees prior to
November 28, 1979.
14.02 Participation - Notwithstanding any provision of this Plan to the
contrary, each
employee of the Corporation who was a Participant in the Stanley Retirement
Plan
immediately prior to November 28, 1979, shall, as of such date, be a
Participant in this
Plan. For purposes of determining eligibility to participate in this Plan,
Service shall
include all periods of employment which would have been taken into account in
computing Service under the Stanley Retirement Plan as in effect immediately
before
November 28, 1979.
14.03 Vesting - Notwithstanding any provision of this Plan to the contrary,
for purposes
of determining an Employee's vested percentage, Service shall include all
periods of
employment prior to November 28, 1979 which would have been taken into
account in
computing Service for such purpose under the Stanley Retirement Plan as in
effect
immediately before November 28, 1979.
14.04 Benefit Accrual - Notwithstanding any provision of this Plan to the
contrary, the
accrued benefit under this Plan as of November 28, 1979 of each employee of
the
Corporation shall be equal to his accrued benefit determined as of such date
under the
provisions of the Stanley Retirement Plan as then in effect, including all
provisions of the
Plan relating to Pre-existing Plans.
ADOPTION OF THE PLAN
Notwithstanding anything contained herein to the contrary, this Plan
is amended and
maintained under the condition that it shall continue to be approved and
qualified by the
Internal Revenue Service under IRC Section 401(a) and that the Trust
hereunder is exempt
under IRC Section 501(a), or under any comparable Sections of any future
legislation
which amends, supplements or supersedes such Sections.
If the Internal Revenue Service determines that the Plan as amended and
restated
hereby is not qualified, the Corporation may modify the Plan to meet Internal
Revenue
Service requirements.
As evidence of its adoption of the Plan, Stanley Furniture Company, Inc.
has caused
this instrument to be signed by its duly authorized officers and its
corporate seal is
affixed hereto this twentieth day of April, 1995.
ATTEST: STANLEY FURNITURE COMPANY, INC.
By: By:
(Title) APPENDIX
ACTUARIAL EQUIVALENT
FACTORS
Pursuant to the provisions of Section 1.02 of the Plan, the following bases
are hereby
adopted, effective January 1, 1989 (unless indicated otherwise), for the
computation of
Actuarial Equivalents under the Plan.
1. ACTUARIAL EQUIVALENT - GENERAL
(a) Protection of Prior Factors -- For Participants in the Norman
Plan on December
31, 1993, in no event shall the benefit earned as of December 31, 1993, be
less than the
benefit the Participant would have received determined on the basis of the
Actuarial
Equivalent factors under this Plan in effect on December 31, 1993.
2. ELIGIBILITY AND PARTICIPATION -- ARTICLE II
(a) Reemployment of Retired Participants Prior to Attainment of Normal
Retirement
Age - Section 2.05
For the purpose of adjustments in this Section - the same basis used
for Available
Options - Section 4.02.
3. RETIREMENT BENEFITS -- ARTICLE III
(a) Delayed Retirement Benefit - Section 3.02
For the purpose of adjustments in this Section - the same basis used
for Available
Options - Section 4.02.
(b) Early Retirement Benefit - Section 3.03
The reduction factors for commencement of a retirement benefit due to
a
Participant's early retirement are one-twelfth (1/12) of six and two-thirds
percent (6 2/3%)
for each month prior to age sixty (60) and one-twelfth (1/12) of three and
one-third
percent (3 1/3%) for each month after age sixty (60) by which the
Participant's benefit
commencement date precedes his Normal Retirement Date.
Notwithstanding the preceding, for Participants in the Norman Plan on
December 31,
1993, in no event shall the benefit earned as of December 31, 1993 and
payable at an early
retirement date be less than the early retirement benefit the Participant
would have
received determined on the basis of the Actuarial Equivalent reduction
factors for early
retirement under the provisions of the Norman Plan as in effect on December
31, 1993.
(c) Disability Retirement Benefit - Section 3.04
For the purpose of adjustments in this Section - the same basis used
for Available
Options - Section 4.02.
(d) Relationship to Retirement Income under Pre-existing Plans -
Section 3.06
For the purpose of adjustments in this Section - the same basis used
for Available
Options - Section 4.02.
4. NORMAL AND OPTIONAL METHODS OF RETIREMENT BENEFIT PAYMENTS --
ARTICLE IV
(a) Available Options - Section 4.02
Actuarial Equivalent shall mean having an equivalent value computed
using the UP-
84 Mortality Table on a unisex basis adjusted for a forty percent (40%)
female content in
the participating group and an interest rate equal to the rate used by the
Pension Benefit
Guaranty Corporation (PBGC) to value immediate annuities for plans
terminating as of
the first day of the Plan Year that contains the proposed distribution or
benefit
commencement date.
(b) Lump Sum Payments - Section 4.05
Actuarial Equivalent for lump sum payments shall be based on an
interest rate equal
to the interest rates published by the PBGC to value immediate and deferred
annuities for
plans terminating as of the first day of the Plan Year coinciding with or
immediately
preceding the date of distribution, and on the UP-84 Mortality Table on a
unisex basis
adjusted for a forty percent (40%) female content in the participating group.
Effective January 1, 1995, Actuarial Equivalent for lump sum payments
shall be
based on an interest rate equal to the annual rate of interest on thirty (30)
year Treasury
securities for the month before the first day of the Plan Year coinciding
with or
immediately preceding the date of distribution, and on the 1983 Group Annuity
Mortality
Table using a blend of fifty percent (50%) of the male mortality rate and
fifty percent
(50%) of the female mortality rate.
5. BENEFITS ON TERMINATION OF EMPLOYMENT - ARTICLE V
(a) Payment of Deferred Vested Benefit - Section 5.02
For the purpose of adjustments in this Section - the same basis used
for Early
Retirement Benefit - Section 3.03.
6. BENEFITS ON DEATH - ARTICLE VI
(a) Death After Eligibility for Early Retirement - Section 6.01
For the purpose of adjustments in the second paragraph of this Section
- - the same
reduction factors used for Early Retirement Benefit - Section 3.03, and the
same basis used
for Available Options - Section 4.02.
For the purpose of determining the value in the fourth paragraph of
this Section - the
same basis used for Lump Sum Payments - Section 4.05.
(b) Death After Eligibility for Normal Retirement - Section 6.02
For the purpose of adjustments in the second paragraph of this Section
- - the same
basis used for Available Options - Section 4.02.
For the purpose of determining the value in the fourth paragraph of
this Section - the
same basis used for Lump Sum Payments - Section 4.05.
(c) Death After Eligibility for Disability Retirement - Section 6.03
For the purpose of adjustments in the second paragraph of this Section
- - the same
reduction factors used for Early Retirement Benefit - Section 3.03, and the
same basis used
for Available Options - Section 4.02.
For the purpose of determining the value in the fourth paragraph of
this Section - the
same basis used for Lump Sum Payments - Section 4.05.
(d) Death of a Vested Participant - Section 6.04
For the purpose of adjustments in the first paragraph of Section
6.04(a) - the same
reduction factors used for Early Retirement Benefit - Section 3.03, and the
same basis used
for Available Options - Section 4.02.
For the purpose of adjustments in the first paragraph of Section
6.04(b) - the same
basis used for Available Options - Section 4.02.
For the purpose of determining the value in the third paragraph of
this Section - the
same basis used for Lump Sum Payments - Section 4.05.
7. MAXIMUM BENEFITS AND REQUIRED DISTRIBUTION OF BENEFITS --
ARTICLE IX
For purposes of Section 9.01(a) and the first paragraph of Sections
9.01(b) and 9.01(c),
the mortality basis used shall be the same basis used for Available Options
- - Section 4.02.
The early retirement factors described in Section 9.01(b) shall be the
same reduction
factors used for Early Retirement Benefit - Section 3.03.
For purposes of Section 9.01(h)(ii) - the same basis used for
Available Options -
Section 4.02.
8. AMENDMENT AND TERMINATION OF THE PLAN - ARTICLE X
For purposes of Sections 10.03(a)(iii), 10.03(d) and 10.04 - the same
basis used for
Available Options - Section 4.02.
9. TOP HEAVY PLAN PROVISIONS - ARTICLE XII
For purposes of Section 12.06 - the same basis used for Available
Options - Section
4.02.
10. MISCELLANEOUS - ARTICLE XIII
For the purpose of Section 13.06(c)(F) - the same basis used for
Available Options -
Section 4.02.
EXCERPTS FROM THE MINUTES
OF
STANLEY FURNITURE COMPANY,
INC.
BOARD OF DIRECTORS MEETING
HELD
ON THE DAY OF
, 1995
RESOLUTION
At a meeting of the Board of Directors of Stanley Furniture Company,
Inc., a Delaware
corporation (hereinafter referred to as the "Corporation"), held on the
day of
, 1995, the following resolution was unanimously
adopted:
WHEREAS, the Board of Directors of the Corporation approved the adoption
of The
Stanley Retirement Plan (hereinafter referred to as the "Plan"), as amended
and restated
effective January 1, 1989; and
WHEREAS, the Corporation reserved the right in Article X of the Plan to
amend said
Plan by action of its Board of Directors; and
WHEREAS, this Board is now desirous of approving a formal amendment to
the Plan in
order to make certain substantive, technical and administrative changes
therein.
NOW, THEREFORE, BE IT RESOLVED that the Plan is hereby amended and
restated in its entirety to the form constituted by the amended and restated
working copy
of the January 1, 1989 draft of the document which incorporates Amendment No.
I and
several other proposed changes, a copy of which is attached to and made a
part of these
minutes, and is hereby approved and adopted effective January 1, 1989.
* * * * * * * * * * * * *
I, ,
Secretary, hereby certify that the foregoing
is a true and exact copy of the Resolution adopted by the Board of Directors
of the
Corporation at a meeting of the said Board held on the day of
,
1995, and entered upon the regular Minute Book of said Corporation and is now
in full
force and effect. I further certify that the Board of Directors of the
Corporation at the
time of adoption of said Resolution had full powers and lawful authority to
adopt said
Resolution.
Attest: STANLEY FURNITURE COMPANY,
INC.
By
Secretary, Board of
Directors