Exhibit 10.22(j)
PLAYBOY ENTERPRISES, INC.
EMPLOYEES INVESTMENT SAVINGS PLAN
(As Amended and Restated Effective January 1, 2008)
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Table of Contents
Page
----
ARTICLE I .--HISTORY AND PURPOSE
Section
1.01
History.............................................1
Section
1.02
Objectives..........................................1
Section
1.03 Supplements and
Exhibits............................1
ARTICLE II --PARTICIPATION
Section
2.01
Eligibility.........................................2
Section
2.02
Re-employment.......................................2
Section
2.03 Crediting Military
Service..........................3
ARTICLE III .--CONTRIBUTIONS
Section
3.01 Profit
Sharing......................................3
Section
3.02 Salary
Reductions...................................4
Section
3.03
Matching............................................5
Section
3.04 Limits on Salary Reduction
Contributions............7
Section
3.05 Limits on Matching
Contributions....................9
Section
3.06 Excess Contributions Under the
ADP and ACP Tests....9
Section
3.07 Limits on Annual
Additions.........................12
Section
3.08 Rollovers
Contributions............................13
Section
3.09
Transfers..........................................14
Section
3.10 USERRA Make-Up
Contributions.......................14
Section
3.11 Catch-Up
Contributions.............................16
Section
3.12 Automatic
Enrollment...............................16
ARTICLE IV .--PLAN ACCOUNTING AND INVESTING
Section
4.01 Participant
Accounts...............................19
Section
4.02 Commingled Investment of
Accounts..................21
Section
4.03 Investment
Funds...................................21
Section
4.04 Investment
Directions..............................22
Section
4.05 Investment Fund
Accounting.........................23
Section
4.06
Expenses...........................................24
Section
4.07 Crediting Contributions and
Forfeitures............24
Section
4.08 Adjustment of Account
Balances.....................25
ARTICLE V .--ENTITLEMENT TO BENEFITS
Section
5.01
Retirement.........................................25
Section
5.02
Disability.........................................26
Section
5.03
Death..............................................26
Section
5.04 Vesting and Termination of
Employment..............27
ARTICLE VI .--BENEFIT DISTRIBUTIONS
Section
6.01 Forms of
Distribution..............................29
Section
6.02 Timing of
Distributions............................30
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Section
6.03 Distribution After
Death...........................31
Section
6.04 Designated
Beneficiaries...........................32
Section
6.05 Direct
Rollovers...................................33
Section
6.06 Qualified Domestic Relations
Orders................34
Section
6.07 Missing
Payees.....................................34
Section
6.08 Incapacitated
Payees...............................35
Section
6.09 Minimum Distribution
Requirements..................35
ARTICLE VII .--IN-SERVICE DISTRIBUTIONS
Section
7.01 Non-Hardship
Withdrawals...........................39
Section
7.02 Hardship
Withdrawals...............................40
Section
7.03 Loans to
Participants..............................43
Section
7.04 No Representation Regarding Tax
Effect of
Withdrawals or Loans...............................45
Section
7.05 Deductions from Accounts and
Investment Funds......46
ARTICLE VIII .--PLAN ADMINISTRATION
Section
8.01
Committee..........................................46
Section
8.02 Plan Administrator's
Powers........................46
Section
8.03 Uniform Application of
Rules.......................48
Section
8.04 Claims
Procedure...................................49
Section
8.05
Indemnity..........................................49
ARTICLE IX .--AMENDMENT, TERMINATION OR PLAN MERGER
Section
9.01
Amendment..........................................50
Section
9.02 Plan
Termination...................................50
Section
9.03 Continuation by a Successor or
Purchaser...........51
Section
9.04 Plan Merger or
Consolidation.......................51
ARTICLE X .--MISCELLANEOUS PROVISIONS
Section
10.01 No Employment
Guarantee............................51
Section
10.02 Nonalienation of Plan
Benefits.....................51
Section
10.03 Applicable
Law.....................................52
Section
10.04 Participant
Litigation.............................52
Section
10.05 Participant and Beneficiary
Duties.................52
Section
10.06 Individual Account
Statements......................52
Section
10.07 Gender and
Number..................................52
Section
10.08 Adequacy of
Evidence...............................53
Section
10.09 Notice to Participants and
Beneficiaries...........53
Section
10.10 Waiver of
Notice...................................53
Section
10.11
Successors.........................................53
Section
10.12
Severability.......................................53
Section
10.13
Nonreversion.......................................53
Section
10.14 Qualification of Plan and
Trust....................54
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ARTICLE XI .--TOP-HEAVY-PLAN RULES
Section
11.01 Top-Heavy
Plan.....................................54
Section
11.02 Aggregation
Groups.................................54
Section
11.03
Vesting............................................55
Section
11.04 Minimum
Contribution...............................55
ARTICLE XII .--DEFINITIONS
Section
12.01
Account(s).........................................56
Section
12.02 Annual
Additions...................................56
Section
12.03
Beneficiary........................................56
Section
12.04 Board of
Directors.................................56
Section
12.05 Break in Service
Years.............................56
Section
12.06
Code...............................................56
Section
12.07
Company............................................56
Section
12.08
Compensation.......................................56
Section
12.09
Disability.........................................57
Section
12.10 Early Retirement
Age...............................57
Section
12.11 Effective
Date.....................................57
Section
12.12 Eligible
Earnings..................................58
Section
12.13 Eligible
Employee..................................59
Section
12.14
Employee...........................................60
Section
12.15
Employer(s)........................................60
Section
12.16 Entry
Date.........................................61
Section
12.17
ERISA..............................................61
Section
12.18 Highly Compensated
Employee(s).....................61
Section
12.19 Hours of
Service...................................61
Section
12.20 Key
Employee.......................................63
Section
12.21 Non-Highly Compensated
Employee(s).................63
Section
12.22 Normal Retirement
Age..............................64
Section
12.23
Participant........................................64
Section
12.24
Plan...............................................64
Section
12.25 Plan
Administrator.................................64
Section
12.26 Plan
Year..........................................64
Section
12.27 Profit Sharing
Earnings............................64
Section
12.28
Spouse.............................................64
Section
12.29 Testing
Earnings...................................65
Section
12.30
Trust..............................................65
Section
12.31
Trustee............................................65
Section
12.32 Year of
Service....................................66
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PLAYBOY ENTERPRISES, INC.
EMPLOYEES INVESTMENT SAVINGS PLAN
(As Amended and Restated Effective January 1, 2008)
ARTICLE I.--HISTORY AND PURPOSE
Section 1.01 History.
Playboy Enterprises, Inc. originally
established the Playboy Enterprises,
Inc. Employees Profit Sharing Plan effective as of December 29,
1958. That plan
has since been amended numerous times, restated effective as of
July 1, 1984,
July 1, 1989 and October 1, 1993, renamed the Playboy Enterprises,
Inc.
Employees Investment Savings Plan (the "Plan"), further restated
effective as of
January 1, 1997, and amended six times thereafter.
The Plan is hereby further amended
and completely restated, as set forth
in this document, effective as of January 1, 2008, to reflect all
the amendments
made since the last restatement, to comply with all applicable
changes in law to
date and to reflect certain minor administrative changes. This Plan
restatement
shall govern the benefit rights of any Participant who becomes
entitled to
receive a benefit from the Plan on or after the effective date of
this
restatement.
Section 1.02 Objectives.
The primary purpose of the Plan is
to enable eligible employees of the
Company (including eligible employees of participating affiliates)
to accumulate
funds for their future retirement security by sharing in any
profits of the
participating employers and by electing to make their own pre-tax
contributions
to the Plan. The Plan is designed and intended to be a
tax-qualified profit
sharing plan under Code Section 401(a) that includes a qualified
cash or
deferred arrangement under Code Section 401(k).
Section 1.03 Supplements and Exhibits.
Supplements or exhibits to this Plan
may be adopted from time to time and
will be attached to and form a part of the Plan. The provisions of
any such
supplements or exhibits shall be given the same effect that such
provisions
would have if they were incorporated within the basic text of the
Plan.
Supplements may modify or supplement provisions of the Plan as they
apply to
particular groups of Participants. Supplements or exhibits will
specify the
persons affected and shall supersede the other provisions of the
Plan to the
extent necessary to eliminate inconsistencies between the Plan
provisions and
the provisions of such supplements or exhibits. The terms used in
such
supplements or exhibits shall have the same meanings as those terms
have for all
other purposes under the Plan, and all provisions of the Plan not
inconsistent
with such supplements or exhibits will continue to apply to the
persons affected
by such supplements or exhibits.
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ARTICLE II--PARTICIPATION
Section 2.01 Eligibility.
(a) Eligibility Conditions. An
Eligible Employee shall commence
participation in the Plan as of the first Entry Date by which the
Eligible
Employee first completes the age and, where applicable, service
requirements for
participation. To satisfy the age requirement, the Eligible
Employee must be at
least eighteen (18) years of age. To satisfy the service
requirement the
Eligible Employee must complete one Year of Service.
However, beginning January 1, 2000,
the Year of Service requirement shall
apply only for purposes of eligibility to participate in the profit
sharing
portion of the Plan; thereafter, no Eligible Employees will be
required to
complete a Year of Service for eligibility to participate in any
other portion
of the Plan. For purposes of the eligibility and re-employment
provisions of
this Article II, the profit sharing portion of the Plan consists of
the making
and allocation of Employer profit sharing contributions under
Section 3.01 of
the Plan.
(b) Prior Participants. Each
Employee who was a Participant in the Plan
immediately before January 1, 2008 shall continue to participate in
the Plan on
and after that effective date without having to satisfy anew the
eligibility
requirements for participation. Such Employee's participation after
that
effective date shall be governed by the Plan as hereby restated,
subject to any
future amendments.
(c) No Accelerated Entry. Nothing in
this Section shall allow an Employee
who was not a Participant immediately prior to the effective date
of this Plan
restatement to commence participation in the Plan earlier than the
effective
date of this restatement.
Section 2.02 Re-employment.
(a) Not Yet Participating. Any
Eligible Employee who had not commenced
participation in the Plan before terminating employment with his
Employer must
satisfy the eligibility conditions of Section 2.01 upon
reemployment with an
Employer before commencing participation in the Plan. If the
Eligible Employee
incurs at least a one year Break in Service before reemployment
with an
Employer, then his service before such Break in Service will not
count towards
completing the Year of Service requirement upon his
reemployment.
(b) Prior Participant. If an
Eligible Employee was a Participant in the
Plan immediately before terminating employment with an Employer,
then upon
reemployment with an Employer (no matter how much later) that
Eligible Employee
shall resume participation in the Plan immediately upon such
reemployment. If
such former Participant had not yet become eligible to participate
in the profit
sharing portion of the Plan, then the rules of Section 2.02(a)
above shall apply
to the crediting of service towards the Eligible Employee's
satisfaction of the
Year of Service requirement for subsequent participation in the
profit sharing
portion of the Plan.
(c) Not Yet Vested. If a Participant
who is not vested in Employer
contributions made under the Plan incurs at least five consecutive
Break in
Service years before resuming employment as an Eligible Employee:
(i) the
Participant's service before such Break shall count only towards
his vested
interest in the portion of his Accounts derived from Employer
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contributions attributable to pre-Break service; and (ii) only the
Participant's
post-Break service shall determine his vested interest in the
portion of his
Accounts derived from Employer contributions attributable to
post-Break service.
(d) Change of Status. A former
Employee who was a Participant and is
rehired by an Employer only on an as needed basis (that is, as a
Class C or
"limited-time" Employee), shall be required to complete 500 new
Hours of Service
within twelve months before being eligible to resume participation.
Such rehired
Employee shall resume participation as of the first day of the next
calendar
month after completing that twelve month service requirement. The
twelve month
period for completing those Hours shall end on each successive
anniversary of
the Employee's date of rehire.
Section 2.03 Crediting Military Service.
Any Employee who timely resumes
employment covered by this Plan directly
from an authorized leave of absence due to a qualifying period of
"service in
the uniformed services" ("qualifying uniformed service") of the
United States
(as defined in the Uniformed Services Employment and Reemployment
Rights Act of
1994 ("USERRA") at 38 U.S.C. ss. 4303(13)) shall have service
credited for the
period of such uniformed service to the extent necessary to comply
with USERRA.
The Employee's period of uniformed service, to the extent it
qualifies under
USERRA for such treatment, shall be considered creditable service
with an
Employer for all purposes of this Plan and no Breaks in Service
shall be
assessed for any portion of said qualifying uniformed service.
ARTICLE III.--CONTRIBUTIONS
Section 3.01 Profit Sharing.
Subject to the limitations of this
Article III, the Company may make a
discretionary profit sharing contribution to the Plan for any one
or more Plan
Years. The amount of such contribution, if any, shall be determined
each year by
the Company's Board of Directors (or any designee of the Board for
this purpose)
in its sole discretion based on business considerations rather than
the
condition of the Plan or the interests of its Participants. Any
such
contribution need not be made solely from, or dependent upon,
available profits
of the Company or any other Employer.
Contributions under this Section
generally shall be determined and made
(if at all) as soon as practicable following the close of the
Company's fiscal
year ending within the Plan Year to which the contribution
pertains. Such
contributions (if any) must be made to the Plan no later than the
earlier of the
due date (including extensions) or actual filing date of the
Company's federal
income tax return for the fiscal year ending within the Plan Year
to which the
contribution pertains.
The obligation to make any
contribution which the Company decides upon
under this Section for a given Plan Year may be allocated among the
Employers
(for the contribution to be made by them) in such proportions as
the Company may
direct. The Employers' contributions
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for any Plan Year shall be pooled and allocated on a uniform basis
among the
accounts of all Participants who are entitled under the Plan to
share in those
contributions for that Plan Year.
Section 3.02 Salary Reductions.
(a) Permitted Level. Each
Participant who is an Employee may elect, from
time to time in accordance with this Article, to reduce his or her
Eligible
Earnings by up to the maximum percentage stated below for
contribution to this
Plan, subject to any other applicable Plan limits on such
contributions. The
maximum percentage for each Highly Compensated Employee shall be
ten percent
(10%) (subject to adjustment during 2008 or thereafter in
accordance with
Section 3.12(b) below) and the maximum percentage for each
Non-Highly
Compensated Employee shall be ninety percent (90%). This
contribution election
shall be expressed in whole percentage increments of the Employee's
Eligible
Earnings, not in dollar amounts unless otherwise allowed by the
Plan
Administrator for similarly situated Employees from time to time.
Subject to
other Plan limits, salary reduction amounts so elected shall be
contributed to
the Plan by the Employee's Employer as a before-tax contribution
allocable to
the account of the electing Employee.
(b) Making Elections. Salary
reduction contributions shall be made through
payroll withholding. Such contributions shall be paid to the Trust
as promptly
as practicable and no later than fifteen (15) business days after
the calendar
month in which the payroll withholding occurred, or within such
other deadline
as applicable law may impose from time to time. No interest or
earnings on
salary reduction contributions shall be due or credited with
respect to any
period before such contributions are actually received by the
Trust.
(c) Effect of Election. Salary
reduction elections by any Participant
shall take effect as of the start of the first payroll period
beginning after
the date on which the Plan Administrator receives the Participant's
written
salary reduction election in proper form, or as of such other date
(not earlier
than the first payroll period ending after the date on which the
Plan
Administrator receives the election in proper form) as the Plan
Administrator
may allow on a uniform basis for similarly situated Participants.
Any salary
reduction election in effect as of the Effective Date shall
continue in effect,
subject to the subsequent operation of any conditions or
limitations applicable
to salary reduction elections under this Plan. A Participant may
change,
discontinue or resume his or her salary reduction election as of
the start of
any future payroll period by filing a proper written election to
that effect
with the Plan Administrator prior to the start of the payroll
period for which
it will be effective.
(d) Electronic Elections. The Plan
Administrator may shorten the advance
notice periods and allow salary reduction contribution elections to
be made by
telephone and/or electronic means, rather than in writing, under
procedures
which:
(i) Do not compel Participants to use methods they do not have
either adequate access to or
reasonable facility with the use of;
(ii) Provide for reasonable monitoring to ensure accessibility;
(iii) Provide for prompt written confirmation of elections made
other than in writing; and
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(iv) Conform to any legal standards that apply in this area
from
time to time.
Section 3.03 Matching.
(a) Transition. The matching
contribution formula applicable to salary
reduction contributions attributable to periods beginning on or
after March 1,
2008 is set forth in Section 3.03(c) below. The matching
contribution formula
applicable to salary reduction contributions for periods prior to
March 1, 2008
is set forth in Section 3.03(b) below. Except for the formula set
forth in
Section 3.03(b) below, all other provisions of this Section 3.03
shall continue
to apply to matching contributions after March 1, 2008.
(b) Pre-March 1. 2008 Formula.
Matching contributions for salary reduction
contributions attributable to Eligible Earnings earned prior to
March 1, 2008
shall be made by a Participant's Employer in an amount determined
as follows:
(i) 100% of the first one percent (1%) of the Participant's
Eligible
Earnings that is credited as a salary reduction contribution to
the
Participant's account for the applicable contribution period;
plus
(ii) 75% of any amount up to the next one percent (1%) of the
Participant's Eligible Earnings that is credited as a salary
reduction contribution to the Participant's account for the
applicable contribution period; plus
(iii) 50% of any amount up to the next three percent (3%) of
the
Participant's Eligible Earnings that is credited as a salary
reduction contribution to the Participant's account for the
applicable contribution period; plus
(iv) 25% of any amount up to the next one percent (1%) of the
Participant's Eligible Earnings that is credited as a
salary
reduction contribution to the Participant's account for the
applicable contribution period.
No matching contribution shall be
made with respect to any salary
reduction contributions that are in excess of six percent (6%) of
the
Participant's Eligible Earnings for the Plan Year.
The final matching contribution made
on a Participant's behalf for a Plan
Year shall reflect any adjustment upward or downward that may be
required in
order that the total matching contributions credited to the
Participant's
account for the Plan Year shall equal the graded cumulative
matching
contribution percentage which corresponds in the following table
(or in the
table in Section 3.03(c) below, where applicable, or to a pro rata
combination
of the two tables to reflect the different formulas in effect for
portions of
2008) to the net level of salary reduction contributions credited
to the
Participant's account for the Plan Year after the application of
all Plan
limitations and adjustments to salary reduction contributions for
that Plan
Year:
Participant's Adjusted
Salary
Cumulative Matching
Reduction
Percentage
Contribution Percentage
--------------------
-----------------------
0%
0%
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Participant's Adjusted
Salary
Cumulative Matching
Reduction
Percentage
Contribution Percentage
--------------------
-----------------------
1%
1%
2%
1.75%
3%
2.25%
4%
2.75%
5%
3.25%
6% or
more
3.5%
In no event shall the aggregate
matching contribution credited to any
Participant for Plan Year exceed 3.5% of the Participant's Eligible
Earnings for
that Plan Year.
(c) March 1, 2008 Formula.
Notwithstanding any foregoing provisions of
this Section 3.03 to the contrary, in accordance with Section
401(m)(12) of the
Code, the matching contribution formula applicable to all salary
reduction
contributions attributable to Eligible Earnings earned on or after
March 1, 2008
shall be:
------------------------------------------------------------
Salary
Reduction
Cumulative Matching
Percentage
Contribution Percentage
----------
-----------------------
------------------------------------------------------------
Up to
1%
1.00%
------------------------------------------------------------
2%
1.50%
------------------------------------------------------------
3%
2.00%
------------------------------------------------------------
4%
2.50%
------------------------------------------------------------
5%
3.00%
------------------------------------------------------------
6% or
more
3.50%
------------------------------------------------------------
In no event shall the aggregate matching contribution credited to
any
Participant for Plan Year exceed 3.5% of the Participant's Eligible
Earnings for
that Plan Year.
(d) Timing. Matching contributions
generally shall be made simultaneous
with the payment of salary reduction contributions for the same
period; that is,
as soon as practicable following each bi-weekly payroll period,
except with
respect to any year-end true-up contribution. In no event shall any
contribution
attributable to a particular Plan Year be made later than the
Employer's federal
income tax return filing deadline (or actual filing date, if
earlier) for the
Employer's tax year ending within that Plan Year. No interest or
earnings on
matching contributions shall be due or credited with respect to any
period
before such contributions are actually received by the Trust.
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Section 3.04 Limits on Salary Reduction Contributions.
(a) Dollar Limits. No Participant
shall be permitted to elect, or have
credited on his or her behalf, a salary reduction contribution in
excess of the
dollar limit under Code Section 402(g), as adjusted for cost of
living factors
by the Secretary of the Treasury from year to year. That dollar
limit is $15,500
for 2008 and $16,500 for 2009, and may be further adjusted for
subsequent years.
This calendar year limit shall apply in aggregate to salary
reduction
contributions made on behalf of the Participant under all
tax-qualified 401(k)
plans in which the Participant participates.
To the extent that salary reduction
contributions in excess of that limit
are made on behalf of a Participant for any calendar year, then the
Plan
Administrator shall direct the Trustee to pay to such Participant
the amount of
such excess, adjusted for any income, gains and losses allocable to
such excess
deferral. That refund shall be made by March 15th of the next
calendar year
following the year for which the excess deferral was made. A
portion of such
excess deferral (and any gains or losses allocable to that portion)
shall be
refunded to the Participant in lieu of the entire amount of such
excess deferral
only if, by March 1st preceding the March 15th refund deadline, the
Participant
has notified the Plan Administrator of the portion of such excess
he or she
would like refunded by the Plan. Any excess deferral refunded to a
Participant
under this Section 3.04(a) shall be counted as a salary reduction
contribution
made on behalf of the Participant for purposes of applying the ADP
Test set
forth in Section 3.04(b) below.
The gain or loss allocable to an
excess deferral is determined by
multiplying by a fraction the Participant's salary reduction
contribution
account gain or loss for the calendar year to which the excess
relates. The
numerator of the fraction shall be the excess deferral amount made
on behalf of
the Participant for the calendar year. The denominator of the
fraction shall be
the total balance of the Participant's salary reduction
contribution account as
of the end of the calendar year, without counting any investment
gain or loss
for that year. Additional gain or loss allocable to the excess
deferral for the
period between the end of the calendar year and the date of the
refund shall be
determined (and included in the refund) by multiplying the total
investment gain
or loss of the Participant's salary reduction contribution account
for that
interim period by the same fraction determined as provided above in
this
paragraph.
(b) ADP Test. As a condition of
continued qualification of the Plan, the
Average Deferral Percentage test (or "ADP Test") must be applied
and passed for
each Plan Year to which such test applies, with respect to salary
reduction
contributions under Section 3.02 of the Plan, as follows:
(i) The Average Deferral Percentage for Highly Compensated
Employees
for any given Plan Year may not
exceed the Average Deferral Percentage for
Non-Highly Compensated Employees for
that Plan Year multiplied by 1.25,
or, if it produces a higher
limit,
(ii) The Average Deferral Percentage for the Highly Compensated
Employees for any given Plan Year
may not exceed the Average Deferral
Percentage for Non-Highly
Compensated Employees for that Plan Year
multiplied by two (2), provided that
the Average Deferral Percentage for
such Highly Compensated Employees
does not exceed
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the Average Deferral Percentage for
such Non-Highly Compensated Employees
by more than two (2) percentage
points or such lesser amount as the
Secretary of the Treasury may
prescribe to prevent the multiple use of
this alternative limitation with
respect to any Highly Compensated
Employee.
Notwithstanding the foregoing, the
ADP Test set forth above shall not
apply to any Plan Year throughout
which the Plan qualifies as a safe
harbor plan in accordance with
Section 3.12(e) below.
(c) Definitions. The following
definitions apply to the ADP Test as
indicated:
(i) Average Deferral Percentage. The average, for a specified
group
of Participants for any given Plan
Year, of the ratios (calculated
separately for each Participant in
such group) of
A) the amount of salary reduction contributions
actually
paid over to the Trust on behalf of such Participant for
that Plan Year, to
B) the Participant's Compensation for such Plan
Year
(whether or not the Employee was a Participant for the
entire
Plan Year).
For purposes of computing Average
Deferral Percentages, an Eligible
Employee who would be a Participant but for the failure to elect
salary
reduction contributions shall be treated as a Participant who makes
no such
contributions.
(ii) Excess Contributions. With respect to any given Plan Year,
the
excess of:
A) The aggregate amount of salary reduction
contributions
actually taken into account in computing the Average
Deferral Percentage of Highly Compensated Employees for
such Plan Year, over
B) The maximum amount of such contributions
permitted by
the ADP Test (determined by reducing contributions made
on behalf of Highly Compensated Employees in order of
their individual actual deferral percentages, beginning
with the highest of such percentages, in accordance with
Section 3.06(a)).
(d) Special Rule. The
following special rule will apply to the ADP Test:
The actual deferral percentage for any Highly Compensated
Employee
for any given Plan Year who is eligible to have salary
reduction
contributions credited (including any qualified employer
deferral
contributions, matching contributions, or qualified nonelective
contributions, even though any such contributions may not be
allowed
in this Plan) to his or her account under two or more plans
described in Sections 401(a) or 401(k) of the Code that are
maintained by the Company or any other Employer will be
determined
as if all such
contributions were made under a single plan.
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Section 3.05 Limits on Matching Contributions.
The Plan Administrator shall apply
to any matching contributions made for
the Plan Year nondiscrimination limitations similar to the ADP
test, as set
forth below. However, the nondiscrimination limitations set forth
in this
Section 3.05 shall not apply for any Plan Year throughout which the
Plan
qualifies as a safe harbor plan in accordance with Section 3.12(e)
below.
The nondiscrimination limitations of
this Section 3.05 (known as the "ACP
Test") operate as follows. The "average contribution percentage" of
the Highly
Compensated Employees shall not exceed, in any Plan Year, the
greater of:
(i) 125 percent of the average contribution percentage of all
other
Participants for such year; or
(ii) The lesser of (A) 200 percent of the average contribution
percentage of all other Participants
for such year and (B) the average
contribution percentage of all other
Participants for such year plus two
(2) percentage points, or such
lesser amounts as the Secretary of the
Treasury shall prescribe to prevent
the multiple use of this alternative
limitation with respect to any
Highly Compensated Employee.
The "average contribution
percentage" for a designated group of
Participants is the average of the ratios (calculated separately
for each
Participant in the group) of (1) the sum of the Employer matching
contributions
paid and credited to the account of such Participant for the Plan
Year, and any
qualified matching contributions or qualified nonelective
contributions made on
behalf of the Participant for the Plan Year to (2) such
Participant's
Compensation for such Plan Year (whether or not the Employee was a
Participant
for the entire Plan Year). Salary reduction contributions may be
used in the ACP
Test provided that the ADP Test under Section 3.04 is both (i) met
before such
contributions are used in the ACP Test and (ii) continues to be met
following
the exclusion of those salary reduction contributions that are used
to meet the
ACP Test.
The excess of the (i) aggregate
amount of Employer contributions taken
into account in computing the numerator of the average contribution
percentage
actually made on behalf of Highly Compensated Employees for such
Plan Year, over
(ii) the maximum amount of Employer contributions permitted by the
ACP Test
(determined by reducing contributions made on behalf of Highly
Compensated
Employees in order of their contribution percentages beginning with
the highest
of such percentages, in accordance with Section 3.06) is the excess
aggregate
contribution.
Section 3.06 Excess Contributions Under the ADP and ACP Tests.
(a) Refunding Excess. For purposes
of both the ACP and ADP tests (when
applicable), any excess aggregate (matching) contribution or excess
deferral
amount shall be determined by starting with the Highly Compensated
Employee(s)
whose ACP or ADP (as appropriate) contribution percentage is
highest and
reducing that amount to the level of the next highest contribution
percentage
for any Highly Compensated Employee. If that reduction is not
sufficient to pass
the test, then all Highly Compensated Employees at that next
highest
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<PAGE>
percentage level will be reduced to the third highest level, and so
on until the
applicable ADP or ACP Test is passed.
Any excess amount determined under
this percentage leveling method shall
then be allocated among Highly Compensated Employees by using a
separate dollar
leveling method, taking the Highly Compensated Employee(s) with the
highest
dollar ADP deferral or ACP contribution amount (depending on which
test is being
run) and reducing that Employee's deferral or contribution level to
that of the
Highly Compensated Employee(s) with the next highest dollar amount,
and so on
until the excess amount determined under the percentage leveling
method is fully
allocated under the dollar leveling method. The excess so allocated
shall then
be deducted from the Accounts of the affected Highly Compensated
Employees and
refunded or reallocated in the amounts determined by the dollar
leveling
allocation, together with any earnings thereon.
Excess contributions under the ADP
Test, including any income and minus
any loss allocable to those contributions, shall be refunded by
distributing
them to the subject Participant no later than the close of the Plan
Year
following the Plan Year in which the excess contribution was made.
In addition,
to the extent required to satisfy the general nondiscrimination
rules for Code
Section 401(a)(4), any matching contributions which are
attributable to refunded
salary reduction contributions shall be refunded to the
contributing Employer.
If such excess contributions are distributed more than 2 1/2 months
after the
last day of the Plan Year in which such excess amounts arose, a ten
percent
(10%) excise tax may be imposed on the Employer maintaining the
Plan with
respect to those amounts. Excess contributions shall be treated as
Annual
Additions under the Plan, even though refunded.
Excess contributions under the ACP
Test, including any income and minus
any loss allocable to those contributions, shall be reallocated to
the Matching
Contribution Accounts of all Non-Highly Compensated Employees who
for that Plan
Year elected salary reduction contributions; but such reallocation
shall be made
pro rata according to their respective Eligible Earnings for the
Plan Year.
(b) Corrective Contributions. The
Employers may choose to make
contributions to the Plan on behalf of Non-Highly Compensated
Employees for a
particular Plan Year in lieu of having the Plan refund or
reallocate excess
amounts under Section 3.06(a) above. The decision whether to
contribute, refund
or reallocate in order to pass the ADP or ACP Tests shall be made
by the Company
based on the financial condition and business interests of the
Employers,
without regard to the interest or preferences of the Participants.
Any such
contribution would be made as of the last day of the Plan Year
being tested.
Such contribution would be in an amount sufficient to raise the
Average Deferral
Percentage or average contribution percentage for the Non-Highly
Compensated
Employee group to the minimum level necessary to satisfy the ADP or
ACP Tests in
Sections 3.04 and 3.05 for that Plan Year. Any contribution made
under this
Section 3.06(b) shall be treated as a supplemental salary reduction
or matching
contribution, as appropriate, for purposes of Plan administration,
and shall be
allocated to the appropriate Accounts of all Non-Highly Compensated
Employees
who had elected any salary reduction contributions for that Plan
Year under
Section 3.02. That allocation shall be made either on an equal per
capita basis
or on a pro rata basis in proportion to the relative salary
reduction
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<PAGE>
contributions made under Section 3.02 on behalf of such
Participants for that
Plan Year, whichever method yields a smaller contribution by the
Employers under
this Section.
Notwithstanding any provisions of
Section 3.06(b) or (c) to the contrary,
any supplemental contribution made to correct for ADP testing (a
"QNEC"
contribution) or ACP testing (a "QMAC" contribution) shall comply
with the
further provisions of this and the following two paragraphs in
order to satisfy
applicable regulations under Code Sections 401(k) and 401(m). Any
QNEC or QMAC
contribution for a particular Plan Year shall be credited to the
affected
Participant's Accounts as of the last day of that Plan Year, and
shall be made
no later than the last day of the next following Plan Year. The
amount of QNEC
and QMAC contributions made for any Plan Year shall not
discriminate in
violation of Code Section 401(a)(4). The QNEC and QMAC limits
stated in these
three paragraphs are intended to satisfy Treasury Regulations
ss.
1.401(k)-2(a)(6) and ss. 1.401(m)-2(a)(6) and so shall be construed
and
administered in compliance therewith.
The aggregate amount of QNEC or QMAC
contributions credited for a Plan
Year to the Account of any Participant cannot separately (with
respect to either
QNEC or QMAC contributions) exceed the product of the Participant's
Compensation
for the Plan Year being tested multiplied by the greater of (i) 5%
or (ii) two
times the Plan's Representative Contribution Rate for that Plan
Year. The
Representative Contribution Rate is the lowest Applicable
Contribution Rate for
the group of Non-Highly Compensated Employees consisting of the
half of all
Non-Highly Compensated Employees counted for ADP testing for the
Plan Year whose
lowest Applicable Contribution Rate is the highest. Such
determination of the
Plan's Representative Contribution Rate may be made by ranking all
such
Non-Highly Compensated Employees for the Plan Year from lowest (or
zero percent)
to highest respective Applicable Contribution Rate, then
identifying the
Applicable Contribution Rate for the Non-Highly Compensated
Employee whose
Applicable Contribution Rate is lowest within the top half (the
half with the
highest Applicable Contribution Rates) of all Non-Highly
Compensated Employees
on that list. A Participant's Applicable Contribution Rate, for all
purposes
under this Section 3.06, shall be the sum of the QNEC and QMAC
contributions
allocated to the Participant for the Plan Year, divided by the
Participant's
Compensation for the Plan Year.
Any QMAC contributions taken into
account for ACP testing compliance shall
not be taken into account for purposes of determining the Plan's
Representative
Contribution Rate for purposes of ADP testing. Similarly, any QNEC
contributions
taken into account for ADP testing compliance shall not be taken
into account
for purposes of determining the Plan's Representative Contribution
Rate for
purposes of ACP testing.
(c) Recharacterized Employer
Contributions. In lieu of these additional
contributions, the Plan Administrator may instead treat Employer
profit sharing
contributions or Employer matching contributions made on behalf of
Participants
who are not Highly Compensated Employees as qualified nonelective
contributions
("QNECs") and qualified matching contributions, respectively, to
the extent
necessary to satisfy the ADP or ACP Tests. In such event, Employer
profit
sharing contributions and Employer matching contributions, to the
extent treated
as qualified nonelective contributions or qualified matching
contributions,
shall be nonforfeitable at all times and subject to the
distribution
requirements and restrictions applicable to Salary Reduction or
Matching
Contribution Accounts, as appropriate, under the Plan.
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<PAGE>
(d) Recharacterized Pre-Tax
Contributions. A Participant may
recharacterize his or her excess contributions as an amount treated
as though
distributed to the Participant and then contributed by the
Participant as an
after-tax contribution to the Plan in order to satisfy the ADP
Test.
Recharacterized amounts will remain nonforfeitable and subject to
the same
distribution rules as salary reduction contributions. Amounts may
not be
recharacterized by a Highly Compensated Employee to the extent that
such amount,
in combination with voluntary contributions made by that Employee,
would exceed
any stated limit under the Plan applicable to after-tax
contributions.
Recharacterization must occur no
later than 2 1/2 months after the last
day of the Plan Year in which the excess contributions arose.
Recharacterization
is deemed to occur on the date the last Highly Compensated Employee
is informed
in writing of the amount recharacterized and the consequences
thereof.
Recharacterized amounts will be taxable to the Participant for the
Participant's
tax year in which the Participant originally would have received
them in cash.
(e) Timing and Records. For purposes
of determining compliance with the
ADP Test and ACP Test (when applicable), salary reduction
contributions,
Employer matching contributions, qualified nonelective
contributions and
qualified matching contributions must be made before the last day
of the
twelve-month period immediately following the Plan Year to which
the
contributions relate.
The Plan Administrator shall
maintain for a reasonable period records
sufficient to demonstrate satisfaction of the ADP Test and ACP Test
and the
amount of salary reduction contributions, after-tax contributions,
Employer
matching contributions, qualified nonelective contributions and
qualified
matching contributions, if any, used in such test.
Section 3.07 Limits on Annual Additions.
(a) Annual Limits. The total Annual
Additions to a Participant's Accounts
for any Limitation Year shall not exceed the lesser of the dollar
limit or the
percentage of compensation limit as in effect under Code Section
415(b), as
amended from time to time. If either such limit under Code Section
415(b) is
adjusted for cost of living increases from time to time by the
Secretary of the
Treasury, such adjusted limit shall then apply under this Section
for any
Limitation Year to which the adjustment relates. As of January 1,
2008 that
dollar limit is Forty Six Thousand Dollars ($46,000.00, rising to
$49,000.00 for
2009) and the percentage of compensation limit is One Hundred
Percent (100%)
under Code Section 415(b).
(b) Definitions. For purposes of
Section 3.07(a), the "Limitation Year"
shall be the Plan Year. In addition, subject to any other
applicable Plan
provisions (including, without limitation, Section 3.12(d) below),
the term
"Annual Additions" shall mean with respect to any Participant, the
sum of:
(i) All Employer contributions made on behalf of the Participant
for
the Limitation Year, including
profit sharing, salary reduction and
matching contributions;
(ii) All after-tax contributions, if any, made by the
Participant
for the Limitation Year; and
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<PAGE>
(iii) All forfeitures credited (if at all under the Plan) to
the
Participant's Account for the
Limitation Year; but rollover and transfer
amounts shall not be included;
provided that
(iv) Notwithstanding anything in the Plan to the contrary and
consistent with Rev. Rul. 2002-45, a
restorative payment that is allocated
to a Participant's account does not
give rise to an Annual Addition for
any Limitation Year.
Whether excess contributions that
are refunded out of the Plan for a given
Limitation Year shall be included or excluded from the term Annual
Additions
depends on the type of contribution and when it was refunded, in
accordance with
applicable regulations under Code Section 415(c).
(c) Adjusting for Multiple Plans.
Contributions and forfeitures credited
to the Participant's account under any other defined contribution
plan(s) for
the same Limitation Year shall be counted as Annual Additions. The
Annual
Additions under this Plan and such other plan or plans must be
adjusted in order
to comply with the limits of Section 3.07(a) above for all such
plans in
aggregate with respect to their common participant for the
applicable Limitation
Year period. Such adjustment shall be made first to the
Participant's accounts
under such other plan or plans before any adjustment shall be made
to the
Participant's Accounts under this Plan.
If any adjustment is needed to the
Participant's Accounts under this Plan
in order to comply with the limitation set forth in Section 3.07(a)
above, that
adjustment shall be made, to the extent necessary, by making
adjustments in the
following order of priority:
(i) Any Employer profit sharing contribution for the Limitation
Year
shall be refunded to the
contributing Employer; and
(ii) To the extent step (i) is insufficient, any salary
reduction
and after-tax contributions credited
to the Participant's account shall be
refunded to the Participant;
provided that after-tax contributions are
refunded to the fullest extent
before any salary reduction contributions
are refunded.
Earnings or losses attributable to
the excess refunded contributions shall
be paid out with the refunded excess only as and to the extent
required by
regulation under Code Section 415.
(d) Applicable Law. The limits of
this Section 3.07 shall be construed and
applied solely to comply with, and in a manner consistent with,
Code Section
415(c), on which they are based.
Section 3.08 Rollover Contributions.
The Plan shall accept Rollover
Contributions on behalf of any Participant
in accordance with this Section with respect to benefits accrued to
the
Participant under any other tax-qualified retirement plan from
which applicable
law allows this Plan to accept rollovers. If made as a cash
contribution by the
Participant, the rollover must be completed on or before the
sixtieth (60th) day
following the Participant's receipt of the eligible rollover
distribution from
the other tax-qualified plan or from an individual retirement
account that was
used as a conduit account
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<PAGE>
solely for an eligible rollover distribution. A rollover
contribution also may
be made through a direct trustee-to-trustee transfer from another
tax-qualified
plan in accordance with Code Section 401(a)(31). Any rollover
contribution
accepted by the Plan will be credited to the Participant's rollover
account and
invested in accordance with the Participant's investment direction
under this
Plan.
The Plan Administrator may require
information from the Participant and
the transferor plan in order to determine whether the rollover is
permissible
under the Code. If the rollover is later found not to be
permissible, in whole
or in part, then any portion thereof which was not permissible
shall be paid out
to the Participant (or to the Participant's designated individual
retirement
account), together with investment earnings or losses attributable
to such
portion.
Certain rollover contributions shall
not be accepted. Contributions of
assets other than cash shall be refused, except for any portion of
the rollover
contribution representing an outstanding plan loan, if the Plan
Administrator
decides to accept it. Any rollover which would carry with it any
annuity
distribution requirements may be refused. Any portion of a rollover
that is
attributable to after-tax contributions or to an outstanding plan
loan may be
refused, in the Plan Administrator's discretion.. The Plan
Administrator has
complete discretion to determine whether to accept all or any
portion of a
rollover contribution and may also refuse a rollover that would in
any other
manner unduly burden or complicate Plan administration. The Plan
Administrator
must have a good faith belief that a rollover contribution is
permissible before
accepting it, and may continue investigating the rollover to
confirm its
permissibility after accepting it, subject to paying out the
rollover or any
portion of it as provided above upon later determining that it was
at least in
part impermissible.
Section 3.09 Transfers.
The vested portion of a
Participant's account under another tax-qualified
retirement plan that is not subject to the survivor annuity rules
of Code
Sections 401(a)(9) and 417, or successor statutes thereto, may be
transferred to
and accepted by this Plan, but only if received by check unless the
Plan Trustee
allows payment by wire transfer or some other method. Only
transfers of cash can
be accepted. Transfers of outstanding plan loans will not be
accepted. Transfers
which would subject the Participant's Account under this Plan to
any survivor
annuity rules shall be refused. Transfers which, in the sole
judgment of the
Plan Administrator, carry with them benefit rights, features or
forms of
distribution that would unduly burden or complicate Plan
administration shall be
refused. Transfers that are accepted by the Plan shall be credited
to a transfer
account on behalf of the Participant and invested in accordance
with the
Participant's direction under this Plan.
Section 3.10 USERRA Make-Up Contributions.
(a) Mandated Employer Contributions.
The Employer with whom an Employee
resumes covered employment upon return on or after December 12,
1994 from
qualifying uniformed service shall be obligated to make, as
promptly as
practicable, special make-up contributions ("Make-up
Contributions") on behalf
of the Employee, in accordance with this Section 3.10. Make-up
contributions
shall be in the amount of all salary reduction contributions,
Employer matching
contributions and profit sharing contributions, if any, which would
have
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<PAGE>
been allocated to the Employee's Accounts under the Plan for the
period of the
Employee's qualifying uniformed service if the Employee had
actually been
working for the Employer in covered service throughout such period.
No make-up
earnings or forfeiture allocations for the period of such
qualifying uniformed
service shall be included in these or any other Make-Up
Contributions under this
Section 3.10.
The amount of these Make-up
Contributions shall be determined based on the
level of compensation the Employee would have received had he
remained actually
employed during such period of qualifying uniformed service. If
that level of
compensation is uncertain, then the Employee's average level of
compensation for
the last twelve months of covered employment (or for his actual
months of
covered employment, if less) shall be used instead.
(b) Elective Pre-Tax Make-Up.
Immediately upon resuming covered employment
(and applying the assumed measure of prior compensation as
described above), the
Employee shall have the opportunity to elect to make-up any salary
reduction
contributions which he or she could have elected under the Plan
during his or
her period of qualifying uniformed service, subject to the Plan
limits on
employee salary reduction contributions that were in effect for
such prior
year(s). If the Employee elected any salary reduction contributions
during his
or her qualifying uniformed service, proper adjustment shall be
made to the
limit on the Employee's make-up salary reduction contributions for
such prior
year(s). This make-up deferral opportunity shall not extend,
however, beyond the
lesser of:
(i) Three times the duration of such qualifying uniformed
service,
or
(ii) Five years, both measured from the date on which the
Employee
resumes covered employment.
(c) Matching on Elective Make-Up.
Any Employer matching contributions
which would have been made on the Employee's behalf with respect to
such period
of qualifying uniformed service had the Employee's make-up salary
reduction
contributions, if any, been made during such period will be made
and allocated
on the Employee's behalf as such make-up salary reduction
contributions are
made, subject to the Plan limits on such Employer matching
contributions that
were in effect for such prior year(s). Make-up Contributions under
this Section
3.10 shall be treated as annual additions for the prior year(s) to
which they
relate, rather than for the year in which they are made.
(d) Allocating Profit Sharing
Make-Up. Any Employer profit sharing
contributions which would have been allocated to the Employee's
Account with
respect to such period of qualifying uniformed service shall be
made as promptly
as practicable and not later than ninety (90) days after the close
of the Plan
Year in which the Employee resumes covered employment. Those
Make-up profit
sharing contributions shall be allocated, without any make-up of
earnings, as of
the close of the Plan Years for which they would have been made on
behalf of the
Employee had he or she been in covered employment during his or her
period of
qualifying uniformed service.
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<PAGE>
Section 3.11 Catch-Up Contributions.
All Employees who are eligible to
make Salary Reduction Contributions
under this Plan and who have attained age 50 or more before the
close of the
Plan Year shall be eligible to make catch-up contributions in
accordance with,
and subject to the limitations of, Section 414(v) of the Code. Such
catch-up
contributions shall not be taken into account for purposes of the
provisions in
Article III of the Plan implementing the required limitations of
Section 402(g)
and 415 of the Code. The Plan shall not be treated as failing to
satisfy the
provisions of the Plan implementing the requirements of Section
401(k)(3),
401(k)(11), 401(k)(12), 410(b) or 416 of the Code, as applicable,
by reason of
the making of such catch-up contributions. The catch-up
contributions authorized
by this Section 3.11 are pre-tax contributions not subject to the
ADP test, not
eligible for matching under Section 3.03 and only permitted by
qualifying
Employees (as described above) who have or will have made their
maximum
allowable Salary Deferral Contribution to the Plan for the Plan
Year after
considering the application of all limits on Salary Deferral
Contributions under
this Article III and the Code.
Section 3.12 Automatic Enrollment.
(a) Intent. The Plan shall begin to
implement an automatic enrollment
feature effective March 1, 2008 in accordance with this Section
3.12. Automatic
enrollment under the Plan shall involve the use of a "qualified
automatic
contribution arrangement" ("QACA") under Section 514 of ERISA and
Code
401(k)(13), that also satisfies the "eligible automatic
contribution
arrangement" ("EACA") conditions of Code Section 414(w); except
that, until
2009, this new automatic contribution feature shall not meet the
QACA safe
harbor requirement that it apply for a full twelve-month Plan
Year.
(b) Automatic Salary Reduction.
Newly Eligible Employees who commence
participation on or after March 1, 2008, and any other Participant
who does not
as of March 1, 2008 have an affirmative salary reduction election
(including an
election not to contribute, effectively a zero salary reduction
percentage) in
effect under the Plan, shall have a fixed percentage of their
Eligible Earnings
automatically reduced from each payroll period that begins on or
after the later
of March 1, 2008 or the date on which such Eligible Employee's
participation in
the Plan begins unless the Participant elects a different permitted
salary
reduction contribution election amount (from zero to the highest
level then
permitted under the Plan) in accordance with Section 3.02 of the
Plan.
The fixed contribution percentages
under this Section 3.12(b) shall start
at four percent (4%) of covered Eligible Earnings for the initial
Plan Year to
which automatic salary reduction first applies to the Participant.
That
automatic contribution percentage shall be successively increased
by one
percentage point as of the start of each subsequent Plan Year for
which the
Participant is subject to automatic salary reduction hereunder;
except that, if
permitted by applicable regulations governing QACA and EACA
features, any
Participant who first becomes subject to automatic salary reduction
on or after
July 1 during a Plan Year shall have the initial four percent (4%)
automatic
salary reduction percentage apply through the end of the next Plan
Year in which
the Participant could be subject to automatic salary reduction
hereunder, so the
initial increase to a five percent (5%) automatic salary reduction
level would
not take effect for
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<PAGE>
that Participant until the start of the second full Plan Year
beginning after
the Plan Year in which the Participant first commenced automatic
salary
reduction contributions hereunder.
For example, an Eligible Employee
hired in 2008 who first joins the Plan
in August of 2008 would, if that Employee did not make an
affirmative salary
reduction contribution election for the balance of 2008, begin
automatic salary
reductions of four percent during 2008 and, if he or she did not
make an
affirmative salary reduction election for 2009, would continue
automatically at
that same four percent (4%) level for 2009 before having the
percentage increase
to five percent (5%) for 2010. But if that Participant had joined
the Plan in
May of 2008 instead, then his or her four percent (4%) automatic
salary deferral
percentage would increase to five percent (5%) for 2009.
Once a Participant has reached an
automatic salary reduction contribution
percentage of six percent (6%) (which would take effect, under the
foregoing
rules, at the start of either the third or fourth Plan Year during
which the
individual was eligible for automatic salary reductions if not for
an
affirmative salary reduction election), thereafter, the automatic
contribution
percentage may be increased in annual one (1) percentage point
increments for
any subsequent Plan Year at the discretion of the Plan
Administrator, but in no
event shall such percentage exceed ten percent (10%) for any Plan
Year.
To the extent permitted without
sacrificing QACA safe harbor status to be
exempt from ADP and ACP Testing under the applicable statutes and
regulations,
the increase in the Plan's automatic contribution percentage may
take effect as
of the effective date of the Company's annual salary increases
(typically during
each January) for that Plan Year but such adjusted percentage shall
then apply
retroactively to the Participant's adjusted Eligible Earnings for
that entire
Plan Year.
The 10% salary reduction
contribution limit for Highly Compensated
Employees under Section 3.02(a) may, in the Plan Administrator's
discretion and
by its announcement in advance, be lifted and removed effective as
of any date
designated during the 2008 Plan Year. If the 10% limit is lifted,
then the same
cap on salary reduction contributions for other Participants under
Section
3.02(a) shall also apply thereafter to Highly Compensated
Employees. In any
event, that 10% salary reduction contribution limit will not apply
beginning
January 1, 2009 if it is not lifted sooner.
(c) Notice of Election Rights. Any
Participant who is subject to automatic
contributions under Section 3.12(b) above shall be furnished notice
(i) of their
salary reduction contribution election rights in accordance with
Code Section
414(w) and ERISA Section 514(e) (3), and (ii) of the operation of
the QDIA
default investment fund and the Participant's investment direction
rights in
accordance with Section 404(c)(5)(B) of ERISA. Such notices may be
combined.
Generally, such notices shall be provided no less than thirty (30)
and no more
than ninety (90) days before the start of each Plan Year (beginning
with the
2009 Plan Year), or in accordance with other timing requirements
made applicable
by regulation under those governing statutes. However, for 2008 and
for any new
Participant commencing participation after the start of a Plan
Year, such
notices instead may be furnished (subject to different regulatory
requirements)
during the ninety (90) day period ending on the later of the
individual's
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<PAGE>
first day of Plan participation or the first day on which the
Participant
becomes eligible for automatic salary reduction contributions.
(d) Special Withdrawal Rights.
Commencing whenever, on or after January 1,
2009, the Plan Administrator announces prospectively that the
withdrawal rights
set forth in this Section 3.12(d) shall first become available, any
Participant
may - within thirty (30) days after the first payroll date on which
an automatic
salary reduction contribution under Section 3.12(b) was withheld
from the
Participant's paycheck or such longer period (not to exceed a total
of 90 days
in aggregate), as the Plan Administrator shall, in its discretion,
allow - make
and file with the Plan Administrator an election to withdraw all
the automatic
salary reductions made on the Participant's behalf through the
close of the next
payroll period that begins after the date on which that withdrawal
election is
made. Such withdrawal election shall require a withdrawal and
refund to the
Participant of all such automatic salary reduction contributions,
adjusted for
investment gains and losses. Any matching contributions
attributable to
automatic salary reduction contributions withdrawn under this
Section 3.12(d)
shall be forfeited immediately upon such withdrawal. Any automatic
salary
reduction contributions withdrawn under this Section 3.12(d) shall
not be
counted for purposes of the ADP Test, if applicable (subject to
Section 3.12(f)
below), for the Plan Year to which such withdrawn contribution
relates.
Similarly, any forfeited matching contributions attributable to
withdrawn
automatic salary reduction contributions under this Section 3.12(d)
shall not be
counted for purposes of any ACP Test, if applicable. To the extent
so provided
by applicable law, such withdrawn and forfeited contributions also
shall not
count as Annual Additions for purposes of the limits under Section
3.07 above.
Withdrawals under this Section 3.12(d) shall not be eligible for
direct
rollover.
(e) ADP/ACP Testing. For any Plan
Year (beginning with 2009) to which the
automatic salary reduction contribution provisions apply for the
entire
twelve-month period, the Plan shall be deemed to satisfy both the
ADP Test under
Section 3.04 above and the ACP Test under Section 3.05 above
without the need to
actually run those tests. This exemption from ADP and ACP Testing
shall apply
provided that all the conditions for such safe harbor under Code
Sections
401(k)(13) and (m)(12) to apply to a QACA feature are met for such
Plan Year.
(f) Vesting. Notwithstanding any
provisions of Section 5.04(b) below to
the contrary, Matching Contributions and Profit Sharing
Contributions
attributable to periods that begin on or after March 1, 2008, and
transferred
amounts received by the Plan on or after March 1, 2008 (to the
extent not
already vested more generously under the transferor plan), shall
vest under the
following table, based on the complete Years of Service standing to
the
Participant's credit as of the date on which his or her employment
with any and
all Employers terminates:
---------------------------------------------------------
Years of
Service
Vested Percentage
----------------
-----------------
---------------------------------------------------------
Less than
2
0%
---------------------------------------------------------
2 or
more
100%
---------------------------------------------------------
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<PAGE>
(g) Separate Accounting.
Notwithstanding any provisions of Section 4.01 or
any other Plan provisions to the contrary, the Plan Administrator
shall
establish and maintain additional separate accounts, or
sub-accounts, to reflect
(i) automatic salary deferral contributions apart from other salary
reduction
contributions; and (ii) matching contributions which are subject to
the vesting
schedule under Section 3.12(f) above apart from matching
contributions which are
subject to the vesting schedule under Section 5.04(b) below.
(h) Refunds of Excess Contributions.
The deadline under Section 3.06(a)
for refunding excess contributions on or after January 1, 2008, in
order to
avoid the ten percent (10%) excise tax, shall be extended to six
(6) months
after the last day of the Plan Year in which such excess amounts
arose, to the
extent such extension and tax avoidance is authorized under Code
Section 4979,
as amended. In addition, such refund of excess contributions shall
not include
gap period income (the investment earnings on such refundable
excess
contributions for the period after the end of the Plan Year for
which such
excess contributions were made until the excess contributions are
refunded) to
the extent such investment adjustment is no longer required under
Code Section
4979.
(i) Resumption After Suspension. If
a Participant's automatic salary
reduction contributions are suspended following a hardship
withdrawal under
Section 7.02, when the suspension period ends and automatic salary
reduction
contributions resume they shall resume at the fixed percentage
level then
applicable under Section 3.12(b) at the time such contributions
resume
regardless of what the automatic contribution level last was before
the hardship
withdrawal.
(j) Miscellaneous. Except as
provided in this Section 3.12, automatic
salary reduction contributions shall be treated as salary
reduction
contributions for purposes of all other Plan provisions and
matching
contributions attributable to automatic salary reduction
contributions shall be
treated as matching contributions for purposes of all other Plan
provisions.
This Section shall be administered and construed so as to comply
with the safe
harbor provisions applicable to QACA and EACA contribution
arrangements under
the applicable Pension Protection Act of 2006 amendments to ERISA
and the Code.
ARTICLE IV.--PLAN ACCOUNTING AND INVESTING
Section 4.01 Participant Accounts.
The Plan Administrator shall
establish and maintain the following separate
accounts, as needed, with respect to Participants, and any other
accounts it
deems necessary from time to time for purposes of Plan
administration:
(a) Salary Reduction Contribution
Account. A "salary reduction
contribution account" shall be maintained on behalf of each
Participant. With
respect to any Participant, this Account shall represent the amount
of such
Participant's salary reduction contributions (whether automatic or
elective,
made under Article III) and the earnings, expenses, appreciation
and
depreciation attributable to such contributions under the Plan, as
well as any
dispositions made therefrom under the Plan.
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19 -
<PAGE>
(b) Profit Sharing Contribution
Account. A "profit sharing contribution
account" shall be maintained on behalf of each Participant. With
respect to any
Participant, this Account shall represent the portion of an
Employer's profit
sharing contributions (made under Article III) and forfeitures for
Plan Years
commencing on or after July 1, 1984 which are allocated for the
Participant's
benefit and the earnings, expenses, appreciation and depreciation
attributable
thereto, as well as any dispositions made therefrom under the
Plan.
(c) Matching Contribution Account. A
"matching contribution account" shall
be maintained on behalf of each Participant on whose behalf
matching
contributions are made under Section 3.03. Such Account shall
represent the
Participant's allocated share of such contributions and the
earnings, expenses,
appreciation and depreciation thereon, as well as any dispositions
made
therefrom under the Plan.
(d) After-Tax Contribution Account.
An "after-tax contribution account"
shall be maintained as needed on behalf of each Participant, which
shall
represent the amount of such Participant's after-tax contributions,
if any, to
this Plan (to the extent allowed by the Plan), and the earnings,
expenses,
appreciation and depreciation attributable to such contributions
under the Plan,
as well as any dispositions made therefrom under the Plan.
(e) Rollover Account. A "rollover
account" shall be maintained on behalf
of each Participant with respect to whom a qualifying rollover
contribution to
this Plan is made in accordance with Section 3.08. Such Account
will reflect his
or her qualifying rollover contribution(s) and the earnings,
expenses,
appreciation and depreciation attributable thereto, as well as any
dispositions
made therefrom under the Plan. The "rollover account" shall
separately reflect,
and account for, any portion of a rollover contribution that
represents
after-tax contributions, outstanding loans or any other feature for
which
separate accounting is appropriate.
(f) Transfer Account. A "transfer
account" shall be maintained on behalf
of each Participant with respect to whom a transfer is made to this
Plan from
another tax-qualified plan in accordance with Section 3.09, which
will reflect
the Participant's transfer and the earnings, losses, expenses,
appreciation and
depreciation attributable thereto, as well as dispositions made
therefrom under
the Plan. The "transfer account" shall separately reflect, and
account for, any
portion of the transferred account that represents after-tax
contributions,
outstanding loans or any other feature for which separate
accounting is
appropriate.
(g) Pending Forfeitures Account. A
"pending forfeitures account" shall be
maintained as a holding account for the Plan (not for any
Participant) to which
will be credited all forfeitures arising under the Plan during the
then current
Plan Year. The "pending forfeiture account" may contain
sub-accounts, as
appropriate, reflecting the source of the forfeited amounts,
including pre- and
post- March 1, 2008 matching and profit sharing account sources.
From time to
time as the pending forfeitures account balance becomes sufficient
for such
purpose, on such dates as determined or authorized by the Plan
Administrator,
such portion of the accumulated balance of this account (or of any
sub-account
therein) shall be deducted from the account and applied or
reallocated as a
forfeiture in accordance with Section 4.07(d).
-
20 -
<PAGE>
Any make-up or corrective
contributions, such as QNECs and recharacterized
amounts, shall be allocated not to their own separate accounts but
to the
account for which such corrective amount is made or
recharacterized, although
such special contributions may be reflected in separate
sub-accounts if the Plan
recordkeeper so provides.
The maintenance of separate account
balances shall not require physical
segregation of Plan assets with respect to each account balance.
The accounts
maintained hereunder represent the Participants' respective
interests in the
Plan and are intended as bookkeeping account records to assist in
the
administration of this Plan. Any reference to a Participant's
"Accounts" or
"Account balances" shall refer to all of the accounts maintained in
the
Participant's name from time to time under the Plan. The Plan
Administrator or
recordkeeper may, in their discretion, rename, reorganize, combine,
divide and
supplement the various accounts maintained under the Plan from time
to time as
deemed necessary, convenient or advisable. References in the Plan
to particular
accounts by name shall also be deemed to refer to that part of a
Participant's
account(s) in the future that is attributable to or similar in
nature to such
former account, as the context shall dictate, regardless of how
such future
account is named or characterized.
The Plan operates on a daily
valuation basis, so each business day shall
be an accounting date. Consequently, except as otherwise provided
in Section
4.07, Participants' Accounts shall be credited or debited with
contributions,
allocations and distributions when actually made or received by the
Plan.
Section 4.02 Commingled Investment of Accounts.
The Trustee, the investment manager
and any insurance institution
responsible for investment of Trust assets shall be permitted to
commingle the
assets of the Trust for purposes of investment with the assets of
other plans or
trusts which are intended to qualify for a federal tax exemption
under Sections
401(a) and 501(a) of the Code. Any documents which are required to
be
incorporated in the Plan and the Trust to permit such commingled
investments are
hereby so incorporated. Segregated investment of Plan and Trust
assets shall not
be required with respect to any one or more Participants, except as
authorized
for missing payees under Section 6.07. Each account invested in a
particular
investment fund shall represent an undivided interest in such
investment fund
which corresponds to the balance of such account.
Section 4.03 Investment Funds.
From time to time the Plan
Administrator may establish, or may cause the
Trustee, an investment manager or an insurance institution to
establish, one or
more investment funds for the investment and reinvestment of Plan
assets. The
continued availability of any investment fund is necessarily
conditioned upon
the terms and conditions of applicable investment management
agreements and
other investment arrangements. While the Plan Administrator shall
select the
various investment funds to be offered by the Trustee under the
Plan, the
continued availability of these funds cannot be assured nor is it
possible to
assure that the arrangements or the investment funds managed by a
particular
investment manager or insurance institution or by the Trustee will
continue to
be available on the same or similar terms. The Plan Administrator
shall maintain
an Investment Policy Statement for the Plan, from time to time, as
required
under ERISA.
- 21 -
<PAGE>
The Plan shall make available for
Participant-directed investment one or
more investment choices from at least each of the following
different types of
investment funds:
(a) An "Equity Fund" designed to
invest primarily in domestic or foreign
equity securities, having capital appreciation and growth, some
current income
and growth of income, with varying levels of risk as the Fund
objectives;
(b) A "Managed Income Fund" designed
to invest primarily in fixed income
securities issued or backed by federal or state governments or
related agencies,
and/or by corporations and by insurance companies, banks and other
financial
institutions, and having preservation of capital and production of
income as the
primary Fund objectives; and
(c) A "Balanced Fund" designed to
invest in both equity and
income-producing securities, and using asset allocation and other
strategies to
provide, with varying levels of risk, both capital growth and
income generation
as primary Fund objectives.
Participant-directed investing shall
be made available under the Plan in a
manner that complies with Section 404(c) of ERISA and applicable
regulations
under that statute, so as to protect Plan fiduciaries from
liability for any
investment selections made under the Plan to the full extent
allowed by law.
The Plan Administrator may, in its
discretion, from time to time change
the available number and identity of investment funds within any of
the three
categories described above and within any new categories utilized
in the future,
add new types of investment funds or delete any type of investment
funds, as it
deems appropriate. Except as provided in this Section 4.03 and
Section 4.04,
Participants' Accounts shall be invested in any one or more of the
available
investment funds. Any investment fund may be partially or entirely
invested in
any common, commingled or collective trust fund, pooled investment
fund or
mutual fund which is invested in property of the kind specified for
that
investment fund.
Section 4.04 Investment Directions.
(a) Participants are permitted to
make and change their investment
directions with respect to both future contributions and existing
Account
balances effective as of any prospective date, with such advance
notice as the
Plan Administrator may require, as frequently as the Participant
may desire, and
to allocate investments among the available investment funds in
increments of
one percent. If allowed by the Plan Administrator, Participants may
give
investment directions directly to any Plan recordkeeper, Trustee or
investment
manager, and such directions may be given verbally or in writing by
such methods
as the Plan Administrator allows by arrangement with such
recordkeeper, Trustee
or investment manager.
During any period for which a
Participant has not made either or both
elections regarding the investment of existing Account balances and
future
contributions, he or she will be considered to have elected by
default to have
his or her other current Account balances or his or her future
contributions, or
both, as the case may be, invested entirely in a Managed Income
Fund determined
by the Plan Administrator to provide the least risk of loss of
capital;
provided, however, that on and after December 21, 2007 the default
investment
fund or funds under the Plan shall be determined instead in
accordance with the
last paragraph of this Section. It shall be
- 22 -
<PAGE>
the responsibility of the Plan Administrator to accumulate,
aggregate and
transmit to the Trustee from time to time, and it shall be the
responsibility of
the Trustee to duly execute, investment instructions based upon a
record of all
proper actual and default investment directions.
From time to time temporary
suspensions of the right to direct investment
changes (and to take loans or withdrawals under the Plan) may be
imposed on
Participants, with advance notice, by the Plan Administrator as
needed to
accommodate changes in such things as Plan fiduciaries, service
providers,
sponsorship, coverage or investment funds. During such "black-out"
periods,
existing investment directions shall continue in effect, subject to
such rules
as the Plan Administrator may establish for any such "black-out"
period.
Effective December 24, 2007, the
Plan Administrator shall designate a new
default investment fund which shall satisfy the requirements for
being a
"qualified default investment alternative" ("QDIA") as defined in
Section
404(c)(5) of ERISA and regulations thereunder. The new default fund
shall apply
(i) to any newly Eligible Employee who becomes a Participant on or
after
December 24, 2007, and (ii) to any Participant for whom automatic
salary
reduction contributions are made after March 1, 2008. At least
thirty (30) days
advance notice of the new QDIA fund shall be provided to such
existing
Participants in order to meet the conditions for the fiduciary
protections of
Section 404(c) of ERISA to apply to the Plan's use of default
funds. The prior
default fund (a Managed Income Fund, as designated by the Plan
Administrator
from time to time) shall continue to be available thereafter (i) as
a
grandfathered default investment option for amounts attributable to
prior
contributions, and (ii) as an investment option with respect to
subsequent
contributions only to the extent selected by affirmative
Participant investment
direction.
Section 4.05 Investment Fund Accounting.
The undivided interest of each
Participant's Account in an investment fund
shall be determined in accordance with the accounting procedure
specified in the
trust agreement, investment management agreement, insurance
contract, custodian
agreement or other document under which such investment fund is
maintained. To
the extent not inconsistent with such procedures, the following
rules shall
apply:
(a) Deposits. Amounts deposited in
an investment fund may be deposited by
means of a transfer of such amounts to such investment fund from
another
investment fund as required to conform with the investment
directions properly
received in accordance with Section 4.04.
(b) Distributions. Amounts required
to be transferred from an investment
fund to satisfy benefit payments and required transfers to
effectuate investment
directions in accordance with Section 4.04 shall be transferred
from such
investment funds as soon as practicable following receipt by the
Trustee or
investment manager of proper instructions to complete such
transfers.
(c) Allocation of Fund Earnings.
Except as provided in the applicable
investment fund document, all amounts deposited in an investment
fund shall be
invested as soon as practicable following receipt of such
deposit.
Notwithstanding the primary purpose or investment policy of an
investment fund,
assets of any investment fund which are not invested in
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<PAGE>
the manner required by the investment fund document shall be
invested in such
short term instruments or funds as the applicable trustee or
investment manager
shall determine, pending investment in accordance with such
investment policy.
Section 4.06 Expenses.
All costs and expenses incurred in
connection with the general
administration of the Plan and Trust, to the extent not paid by the
Company,
shall be allocated (for deduction) among the investment funds in
the proportion
in which the amount invested in each such fund bears to the amount
invested in
all funds as of the accounting date preceding the day of
application, provided
that all costs and expenses directly identifiable to one fund shall
be allocated
to that fund.
Section 4.07 Crediting Contributions and Forfeitures.
(a) Salary Reduction Contributions.
Salary reduction contributions shall
be credited to the Accoun
