EXHIBIT 10.1
UPS THRIFT PLAN
(Restated to incorporate Amendment Nos. 1-24)
UPS THRIFT PLAN
TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS 2
Section 1.1 Definitions 2
Section 1.2 Construction 5
ARTICLE II ELIGIBILITY FOR PARTICIPATION 6
Section 2.1 One Year of Service 6
Section 2.2 Application for Participation 6
Section 2.3 Reemployment 6
ARTICLE III SAVINGS BY PARTICIPANTS 7
Section 3.1 Amount of Savings 7
Section 3.2 Savings Through Payroll Deductions 7
Section 3.3 Payroll Deductions 8
Section 3.4 Alteration of Payroll Deduction Order 8
Section 3.5 Suspension of Payroll Deductions 8
Section 3.6 Adjustment of Savings Amounts 8
ARTICLE IV EMPLOYER CONTRIBUTIONS 9
Section 4.1 Determination of Tentative Aggregate Contribution 9
Section 4.2 Apportionment of Tentative Aggregate Contribution Among Employers 9
Section 4.3 Reduction of Employer's Tentative Contribution 10
Section 4.4 Contributions on Behalf of Employee of Another Employer 10
Section 4.5 Time for Payment of Contributions 10
Section 4.6 Permissible Contributions and Irrevocability 10
ARTICLE V ACCOUNTS AND ALLOCATIONS 12
Section 5.1 Funds and Accounts Established 12
Section 5.2 Accounting Period of Trust 12
Section 5.3 Payments into General Fund; Charge for Withdrawals 12
Section 5.4 Annual Appraisal 12
Section 5.5 Fund Investment Income Account 13
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Section 5.6 Allocation of Income and Contributions to Accounts 13
Section 5.7 Reserved 14
ARTICLE VI LIMITATION ON ALLOCATION OF EMPLOYER CONTRIBUTIONS 15
Section 6.1 Limitation On Contributions on Behalf of Individual Employees 15
Section 6.2 Contribution Limitations Under Section 401(m) of the Code 18
ARTICLE VII RESERVED 23
ARTICLE VIII VESTING 24
Section 8.1 Nonforfeitability of Participant's Accounts 24
ARTICLE IX WITHDRAWALS 25
Section 9.1 Withdrawal of Participant Savings Account 25
Section 9.2 Emergency Withdrawals 25
Section 9.3 Further Withdrawals 25
Section 9.4 Payment of Withdrawn Amounts 25
Section 9.5 Timing of Payment 26
Section 9.6 Waiting Period 26
Section 9.7 Applications for Withdrawal 26
ARTICLE X DISTRIBUTION ON TERMINATION OF REGULAR EMPLOYMENT 27
Section 10.1 Distribution of Account Balances; Imputed Employer Contributions and 27
Imputed Investment Income or Loss for Final Year of Participation
Section 10.2 Methods of Distribution; Limitations Regarding Time of Payment of Benefits 28
Section 10.3 Payment to Beneficiary in Event of Death 29
Section 10.4 Reserved 30
Section 10.5 Direct Rollover 30
ARTICLE XI LOANS 32
Section 11.1 Committee May Make Loans 32
Section 11.2 Administration of Loan Program 32
Section 11.3 Default; Payment upon Termination of Employment 32
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ARTICLE XI ADMINISTRATIVE COMMITTEE 34
Section 12.1 Administrative Committee 34
Section 12.2 Vacancies on Committee 34
Section 12.3 Authority of Committee 34
Section 12.4 Action by Majority of Committee 34
Section 12.5 Claims Procedure 34
Section 12.6 Liability of the Committee 35
Section 12.7 Authority to Appoint Officers and Advisors 36
Section 12.8 Committee Meeting 36
Section 12.9 Compensation and Expenses of Committee 36
Section 12.10 Records. 36
Section 12.11 Forfeiture in Case of Unlocatable Participant 36
Section 12.12 Fiduciary Responsibility Insurance, Bonding 37
Section 12.13 Delegation of Specific Responsibilities 37
Section 12.14 Allocation of Responsibility Among Fiduciaries for Plan and Trust 37
Administration.
ARTICLE XIII INVESTMENTS 39
Section 13.1 Committee to Direct Investments 39
Section 13.2 Investment of the General Fund 39
Section 13.3 Reserved 39
Section 13.4 Seventy-Five Percent Limitation 39
ARTICLE XIV CERTAIN RIGHTS AND OBLIGATIONS OF THE EMPLOYER COMPANIES 41
Section 14.1 No Liability of Employers for Payments Under Plan. 41
Section 14.2 Right to Terminate Plan 41
Section 14.3 Notice of Termination 41
Section 14.4 No Right to Employment 41
Section 14.5 Receipt for Final Payment 41
ARTICLE XV NONALIENATION OF BENEFITS 42
Section 15.1 Nonalienation of Benefits 42
ARTICLE XVI AMENDMENTS; MERGER 44
Section 16.1 Right to Amend 44
Section 16.2 Non-diversion of Assets 44
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Section 16.3 Notice of Amendment 44
Section 16.4 Participation by Related Corporations 44
Section 16.5 Merger or Consolidation of Plan; Transfer of Plan Assets 44
ARTICLE XVII TERMINATION 45
Section 17.1 Application of Assets Upon Termination 45
ARTICLE XVIII MISCELLANEOUS 46
Section 18.1 Governing Law 46
Section 18.2 Facility of Payment 46
Section 18.3 No Access to Records 46
Section 18.4 Annual Accounting 46
Section 18.5 Obligation of Employers to Pay Amounts Withheld 46
Section 18.6 Annual Examination of Books and Records 46
Section 18.7 Gifts to Trust 47
Section 18.8 Titles 48
Section 18.9 Counterparts 48
Section 18.10 Prohibition Against Attachment 48
Section 18.11 Payment to Minor Beneficiary 48
Section 18.12 Plan Provisions in Effect 48
Section 18.13 Withholding of Income Tax 49
ARTICLE XIX TOP-HEAVY PROVISIONS 51
Section 19.1 Effective Date of This Article 51
Section 19.2 Definitions 51
Section 19.3 Top-Heavy Vesting Schedule 54
Section 19.4 Top-Heavy Minimum Benefit 54
Section 19.5 Reserved 54
Section 19.6 Reserved 54
Section 19.7 Top-Heavy Adjustment to Section 415 Limitations 54
Section 19.8 Certain Benefits Disregarded 55
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UPS THRIFT PLAN
WHEREAS, United Parcel Service of America, Inc. and its affiliated
corporations have heretofore established the UPS Thrift Plan for the benefit of
their eligible employees, in order to provide benefits to those employees upon
their retirement, death or other separation from service, effective as of July
14, 1960;
WHEREAS, following the enactment of the Employee Retirement Income
Security Act of 1974, the Plan was amended and restated in its entirety,
replacing all of the provisions of the Plan then in effect, being effective as
of January 1, 1976; and
WHEREAS, the Plan has subsequently been amended on a number of
occasions; and
WHEREAS, the Board of Directors adopted a resolution to terminate the
Plan effective July 25, 2001:
NOW, THEREFORE, the UPS Thrift Plan is hereby restated to incorporate
all amendments made to date for ease of administration and for purposes of
obtaining a final determination letter.
ARTICLE I
DEFINITIONS
The words and phrases used in the Plan shall have the meanings set
forth in this Article unless a different meaning is required by the context.
Section 1.1 Definitions.
(a) "Plan" means the United Parcel Service
Thrift Plan, also called the UPS Thrift Plan, as set forth herein, and as the
same may be amended from time to time by the Board of Directors.
(b) "Trust Agreement" means the Agreement or
agreement of trust establishing the UPS Thrift Plan Trust, as restated effective
as of January 1, 1976, including any future amendments and modifications, which
form a part of the Plan.
(c) "Trust" or "Trust Fund" means the UPS Thrift
Plan Trust Fund, the Trust Fund created by the Trust Agreement or Trust
Agreements, and shall generally mean the money and other property held by the
Trustees for purposes of the Plan.
(d) "Employer" means United Parcel Service of
America, Inc., and any domestic subsidiary or domestic affiliate that adopts the
Plan with the approval of the Board of Directors.
(e) "Company" means all of the following
corporations collectively:
(1) United Parcel Service of America,
Inc.;
(2) Any domestic corporation at least
90% of whose voting stock is owned by or for the benefit of the stockholders of
United Parcel Service of America, Inc.;
(3) Any domestic corporation at least
90% of whose voting stock is owned by any corporation described in (1) or (2)
above; and
(4) Any domestic corporation at least
90% of whose voting stock is owned by any corporation described in (3) above
(f) "Board of Directors" means the Board of
Directors and/or the Executive Committee of United Parcel Service of America,
Inc.
(g) "Committee" means the Administrative
Committee, the establishment and responsibilities of which are set forth in
Article XII, each member of which is a named fiduciary with respect to this
Plan. The Committee shall be and is the Plan Administrator and the agent for
service of process on or with respect to the Plan.
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(h) "Trustee" means the corporations or
individuals so designated by the Board of Directors to hold assets of the Plan
for the purposes of the Plan.
(i) "Employee" means a person who is in the
Regular Employment of an Employer. For purposes of this Plan, a citizen of the
United States who is transferred from Regular Employment with a domestic
Employer to employment with a foreign corporation at least 90% of whose voting
stock is owned by, or for the benefit of the stockholders of United Parcel
Service of America, Inc., and as to which foreign corporation a domestic
Employer Corporation has entered into an agreement pursuant to Section 3121(1)
of the Internal Revenue Code of 1954, as amended, shall be deemed an employee of
United Parcel Service of America, Inc., during such time as he remains in the
Regular Employment of the foreign corporation and the foreign corporation
remains covered under such agreement. The term "Employee" shall not include an
individual employed as a leased employee as that term is defined in Code Section
414(n)(2).
(j) "Regular Employment" means, with respect to
any Employee, his customary employment (including any leave of absence, with or
without compensation, approved by the Committee) with an Employer, excluding
employment as a casual, occasional, temporary or special employee, as determined
in accordance with applicable rules and practices in effect at the time the
determination is made, applied in a uniform nondiscriminatory manner to all
employees similarly situated. A transfer from one Employer to another Employer
shall not constitute a termination of regular employment.
Notwithstanding the foregoing, any Employee, including a casual,
occasional, temporary, or special employee, who completes 1,000 Hours of Service
in the twelve-month period following his date of employment or in any Plan Year
thereafter, shall be deemed to be in Regular Employment. For purposes of this
definition, an Hour of Service means (i)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; (ii) 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), lay-off, jury duty, military duty or leave of absence;
and (iii)each hour for which back pay, irrespective of mitigation of damages, is
either awarded or agreed to by the Employer. In no event, however, no more than
501 Hours of Service will be counted or credited under (ii) above on account of
any single continuous period during which the Employee performs no duties
(whether or not such period occurs in a single computation period), and no Hour
of Service shall be counted or credited under (ii) above if such payment is made
or due under a Plan maintained solely for the purpose of complying with
applicable workman's compensation
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or unemployment compensation or disability insurance laws; and no Hour of
Service shall be counted or credited for payment which solely reimburses an
Employee for medical or medically related expenses incurred by the Employee. A
payment shall be deemed to be made by or due from the Employer whether made by
or due from the Employer directly or indirectly through a trust fund, insurer,
or other entity to which the Employer contributes or pays premiums, regardless
of whether contributions are for the benefit of particular employees or are on
behalf of a group of employees in the aggregate. Hours of Service shall be
credited under the terms of Department of Labor Regulations, Sections
2530.200b-2(b) and (c). Notwithstanding any Plan provision to the contrary,
effective for reemployments initiated on or after December 12, 1994,
contributions, benefits and service credit with respect to qualified military
service will be provided in accordance with IRC section 414(u).
(k) "Year of Service" means a twelve month
period commencing on a Participant's date of employment and any Plan Year
thereafter.
(l) "Participant" means an Employee or former
Employee who became eligible for coverage under this Plan upon meeting the
eligibility requirements of Article II hereof, and as to whom the Committee has
not authorized, in accordance with the provisions of Article X, a distribution
of all funds standing to his credit under this Plan. (m) "Participation" means
the period commencing on the date as of which the Employee or former Employee
met the eligibility requirements of Article II hereof, and became covered under
this Plan, and ending on the date on which the Committee authorizes, in
accordance with Article X, a distribution of all funds standing to his credit
under the Plan.
(n) "Beneficiary" means the person or persons
designated to receive benefits under this Plan by a Participant pursuant to
Section 10.3 hereof.
(o) "Plan Year" means a calendar year except
that the first Plan Year shall commence on the date when the Plan is declared to
be operative by the Board and shall terminate on December 31 of the same year.
(p) "ERISA" means P.L. 93-406, the Employee
Retirement Income Security Act of 1974, as amended from time to time.
(q) "Effective Date" means July 14, 1960.
(r) "Effective Date of Amendment" means January
1, 1976.
(s) "Related Employer" means (1) any other
corporation on and after the date that it, together with the Employer, is a
member of a controlled group of corporations as described in Section 414(b) of
the Code; (2) any other trade or business (whether or not incorporated) on and
after the
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date that it and the Employer are under common control as described in Section
414(c) of the Code; and (3) any organization (whether or not incorporated) on
and after the date that it, together with the Employer, is a member of an
affiliated group of employers as described in Section 414(m) of the Code.
Section 1.2 Construction.
Wherever required, words used in the masculine gender shall include the feminine
gender. Words used in the singular or plural shall be construed as if plural or
singular, respectively, where the context requires.
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ARTICLE II
ELIGIBILITY FOR PARTICIPATION
Section 2.1 One Year of Service. Any Employee who has completed a
Year of Service in Regular Employment with one or more Employers shall be
eligible to become a Participant in this Plan.
Section 2.2 Application for Participation. An eligible Employee
shall become a Participant in the Plan after all of the following steps have
been complied with:
(a) The eligible Employee has executed an
application containing such information as the Committee shall prescribe;
(b) Said Employee has executed a written order
directing and authorizing his Employer to make payroll deductions from his
salary or wages and to remit the amounts so deducted to the Trustee;
(c) The Employer has verified the information on
the application and has forwarded the verified application and payroll order to
the Committee; and
(d) The Committee has approved the application
and payroll order and has returned the payroll order to the Employer.
Participation shall commence as of the date on which the Committee approved the
application, but in no event later than six months after a Year of Service in
Regular Employment has been completed or the beginning of the next Plan Year,
whichever is earlier.
Section 2.3 Reemployment. Any Participant who ceases to be a
Participant in the Plan by reason of termination of employment or otherwise,
shall upon re-employment become eligible to be a Participant after the steps
listed in Section 2.2 have been complied with. Upon the Committee's approval of
the Employee's application and payroll order, participation of the Participant
in the Plan shall recommence, as soon thereafter as is administratively
feasible. If the Participant wishes his participation to recommence at an
earlier date (but not before his date of re-employment, or the first day of the
calendar year in which his readmission is approved by the Committee, whichever
is later), the Participant may, upon the Committee's approval of his
re-application for participation, make a lump sum contribution in an amount
equal to the contributions that would have been deducted from his salary or
wages between the earlier date and the date payroll deductions recommence.
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ARTICLE III
SAVINGS BY PARTICIPANTS
Effective September 30, 1995, no further Participant savings contributions to
the Plan by means of payroll deductions or otherwise shall be allowed or
accepted by the Plan.
Section 3.1 Amount of Savings. Each Participant may
authorize savings by means of payroll deductions to be paid into the Plan of
three dollars, four dollars, five dollars or six dollars a week.
Section 3.2S Savings Through Payroll Deductions. Such
savings may be paid into the Plan only by means of a payroll deduction which
each Participant shall authorize through a written payroll deduction order. Cash
payments will not be accepted from Employees in lieu of payroll deductions,
except as provided in Section 2.3 and as follows:
(a) Upon re-employment prior to the end of the
twelve (12) month period commencing on his or her date of termination of
employment, a Participant shall be permitted under the provisions of Section
10.1(e) herein to restore all, but not less than all, of the amount of
distributions previously made to him or her under Article X, provided the amount
of such repayment is at least $1,000.
(b) Weekly cash payments in the amount of three,
four, five or six dollars per week will be accepted from Participants who are no
longer in Regular Employment due to disability. In addition, a lump-sum cash
payment up to a maximum of six dollars per week for each week of disability may
be made upon returning to work following the end of the period of disability.
(c) Weekly cash payments in the amount of three,
four, five or six dollars per week will be accepted from Participants who have
been granted a leave of absence due to disability or other health or medical
problem, or who are absent from work for any period beginning on or after
January 1, 1985 as a result of:
(1) the pregnancy of such Participant;
(2) the birth of a child of the
Participant;
(3) the placement of a child with the
Participant in connection with the adoption of a child by the Participant; or
(4) caring for a child of the
Participant immediately following its birth or placement. Cash payments will be
accepted under such circumstances only if the Participant indicates that he or
she expects to return to work within eighteen (18) months from the date the
leave of absence began.
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If the Participant does not return to work prior to the end of this eighteen
(18) month period, the Participant shall no longer be permitted under this
provision to make any further cash payments in lieu of payroll deductions unless
he or she establishes to the satisfaction of the Administrative Committee that
he or she will return to work within a reasonable period of time. In lieu of
weekly cash payments, a Participant may upon return to work make a lump-sum cash
payment of up to six dollars for each week of absence described in this
subsection 3.2(c).
Section 3.3 Payroll Deductions. Payroll deductions shall begin no
later than the first payday of the first month which begins at least ten days
after the receipt by the Employer of the approved payroll order from the
Committee.
Section 3.4 Alteration of Payroll Deduction Order. A payroll
deduction order shall remain in force until (a) a Participant files another
written order directing his Employer to increase, decrease or terminate his
payroll deductions under the Plan and such other order has been approved by the
Committee and returned to the Employer, or (b) until a Participant's employment
with an Employer is terminated.
Section 3.5 Suspension of Payroll Deductions. The Committee may
provide for a suspension of payroll deductions for any pay period for any
appropriate reason. Such suspension will not be effective in the case of any
Participant who notifies the Committee that he does not wish his payroll
deductions to be so suspended.
Section 3.6 Adjustment of Savings Amounts. The amounts shown as
weekly savings in Section 3.1 may be suitably adjusted in accordance with
schedules established by the Committee for pay periods other than weekly pay
periods.
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ARTICLE IV
EMPLOYER CONTRIBUTIONS
Section 4.1 Determination of Tentative Aggregate Contribution.
(a) On or before December 31 of each calendar
year, the Board of Directors may, but shall not be obligated to, provide, from
the consolidated earnings and profits of the Company, an ascertainable amount
with respect to such calendar year, which shall be known as the "Tentative
Aggregate Contribution" of all the Employers for such calendar year.
(b) The Tentative Aggregate Contribution, if so
provided, shall consist of:
(1) A basic aggregate Employer
contribution, which shall be apportioned among all the Employers in accordance
with Section 4.2, reduced in accordance with Section 4.3 and allocated to the
accounts of Participants in accordance with Section 5.6; plus
(c) That portion of the Tentative Aggregate
Contribution described in Section 4.1(b)(1) shall, unless this limitation shall
be specifically waived by the Board of Directors, not be greater than the:
(1) the consolidated profits of the
Company for such year, determined in accordance with generally accepted
accounting principles but without regard to gains or losses on the sale or
exchange of real property or of stock in any corporation described in Section
1.1(e).
In determining the consolidated profits of the
Company for purposes of this Section 4.1(c), all expenses recorded on the books
of the Company as of the close of the year, including but not limited to all
taxes but not including contributions to this Plan, shall be deducted. The
Federal income taxes, for purposes of this Section 4.1(c), shall be determined
without regard to gains or losses on the sale or exchange or real property or of
stock in any corporation described in Section 1.1(e).
(d) The portion of the Tentative Aggregate
Contribution described in Section 4.1(b)(1) for any calendar year shall, unless
this limitation shall be specifically waived by the Board of Directors, not
exceed $30,000,000.
Section 4.2 Apportionment of Tentative Aggregate Contribution
Among Employers.
(a) The portion of the Tentative Aggregate
Contribution described in Section 4.1(b)(1) shall be apportioned among all the
Employers in accordance with the ratios which the
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aggregate average monthly balances for such year of all the accounts in the
General Fund, as of December 31, of all the Participants in the Plan of each
Employer, whether or not in Regular Employment on such date, bears to the
aggregate average monthly balances for such year of all the accounts in the
General Fund, as of December 31, of all Participants in the Plan. The portion of
the Tentative Aggregate Contribution so apportioned pursuant to this paragraph
to each Employer shall be referred to as the "Tentative Basic Contribution" with
respect to such Employer.
Section 4.3 Reduction of Employer's Tentative Contribution The
Tentative Basic Contribution with respect to each Employer shall be reduced to
the extent that such Tentative Basic Contribution may not be allocated to the
Participants in the Plan employed by such Employer because of the limitations
provided in Sections 5.6(b)(3), 6.1 and 6.2 of the Plan. The Tentative Basic
Contribution of each Employer so reduced, which shall be referred to as the
"Basic Contribution" (or the "Contribution") of such Employer, shall be
contributed to the Plan by such Employer out of its current or accumulated
earnings and profits within the time limit prescribed in Section 4.5. The
Contribution of each Employer, however, shall not exceed the amount allowable
under the Internal Revenue Code to such Employer or to a foreign subsidiary of
such Employer as a deduction for contributions paid to this Plan.
Section 4.4 Contributions on Behalf of Employee of Another
Employer. If any Employer is prevented from making its contribution as
determined under Section 4.3 hereof because it has no current or accumulated
earnings or profits or because such earnings or profits are insufficient for it
to make its contribution in full, then so much of the contribution which such
Employer is prevented from making may be made for the benefit of the
Participants in the Plan employed by such Employer by the other Employers to the
extent and in the amounts permitted by Section 404(a)(3)(B) of the Internal
Revenue Code. Any such contribution made for an Employer by one or more other
Employers shall be considered for all provisions of the Plan, unless otherwise
provided in the Internal Revenue Code, to have been made by the Employer for
whose benefit it was made, and shall be considered as a loan to said Employer.
Section 4.5 Time for Payment of Contributions. The amount of each
Employer's Contribution to the Plan for each calendar year shall be paid to the
Trustee, either in a single payment or in installments, not later than the date
prescribed by law, including extensions thereof, for the filing of such
Employer's Federal Income tax return for such calendar year.
Section 4.6 Permissible Contributions and Irrevocability. Any
amount contributed by an Employer pursuant to this Article IV is conditioned on
its deductibility under the Internal Revenue Code, and may be contributed in
cash or other property including Qualifying Employer Securities as defined in
ERISA. No such contribution, or any part thereof, shall revert to or be
recoverable by the Employer, unless
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(a) the contribution is made by reason of a mistake of fact, (b) the
contribution is conditioned on qualification of the Plan under the Internal
Revenue Code and the Plan does not so qualify, or (c) the contribution is
determined to not be deductible under the Internal Revenue Code. Any such
reversion or recovery must be made within one year of the mistaken payment of
the contribution, the date of denial of qualification, or disallowance of the
deduction, as the case may be.
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ARTICLE V
ACCOUNTS AND ALLOCATIONS
Section 5.1 Funds and Accounts Established
(a) The assets of the Plan shall be held in Trust
in a single fund, the General Fund. All Participant accounts in the Distribution
Fund as of July 31, 1996 shall be transferred to, and become a part of, the
General Fund.
(b) The Committee shall maintain individual accounts for
each Participant in the General Fund as follows: a Participant Savings Account;
an Employer Contributions Account; and a Participant Investment Income Account.
(c) The Committee shall also maintain a Special Gift
Account and a Fund Investment Income Account in the General Fund.
Section 5.2 Accounting Period of Trust. The accounting period for
the Trust shall be a calendar year unless the Committee shall determine a
shorter period.
Section 5.3 Payments into General Fund; Charge for Withdrawals.
(a) All amounts deducted from a Participant's
salary or wages in accordance with Article III shall be paid over to the Trustee
and credited to the individual Participant Savings Accounts maintained for
Participants in the General Fund not later than the close of the month
immediately following the month in which the payroll deductions are made.
(b) Contributions made by the Employers shall be
credited to the individual Employer Contributions Accounts maintained for
Participants in the General Fund. Such credits shall be made as of the close of
the calendar year for which an Employer contribution is made, but shall not be
taken into account in determining the monthly balances of Participants for such
calendar year.
(c) No charges shall be made to either
individual Participant Savings Accounts or Employer Contributions Accounts in
the General Fund except for withdrawals or distributions on termination of
regular employment or for appropriate charges because of deficits in the
Participant Investment Income Accounts in the General Fund.
Section 5.4 Annual Appraisal. As of December 31st in each year,
or as of the end of any shorter accounting period that the Committee shall
select, all of the assets in the Trust shall be appraised by or under the
supervision of the Committee so that such assets will be stated at market value
for the
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applicable date. Such appraisal shall be made in accordance with market
quotations when available and on the basis of such other facts as the Committee
deems appropriate in the circumstances.
Section 5.5 Fund Investment Income Account.
(a) The Fund Investment Income Account of the
Fund shall be credited during each accounting period with the following:
(1) interest, dividends, rents and
other income received by the Trustee;
(2) increase in the value of Fund
assets based on the appraisal of such assets made pursuant to Section 5.4 as of
the last day of such accounting period;
(b) The Fund Investment Income Account of the
Fund shall be charged during each accounting period with the following:
(1) cost of producing income, such as
real estate taxes, insurance and repairs;
(2) an allocated portion of the trust
expenses to the extent not paid by the Employer;
(3) decrease in the value of Fund
assets based upon the appraisal of such assets made pursuant to Section 5.4 as
of the last day of such accounting period.
Section 5.6 Allocation of Income and Contributions to Accounts.
After the end of each accounting period the Committee shall make the following
allocations:
(a) As of the end of each accounting period the
Committee shall credit or charge the Participant Investment Income Accounts of
each Participant in the Fund with an account balance at the end of such
accounting period, with that part of the income or loss shown in the Fund
Investment Income Account for such period, as bears the same ratio to such
income or loss of the Fund as the balance of such Participant's combined
Participant Savings Account, Employer Contributions Account and Participant
Investment Income Accounts in the Fund at the end of the prior accounting period
bears to the balances of such combined three accounts of all Participants in the
Fund at the end of the prior accounting period.
(b) (1) As of the end of each calendar year the
Committee shall, subject to paragraph (3) below, credit each eligible
Participant's Employer Contributions Account in the General Fund with that part
of the Employer's Basic Contribution for the year as bears the same ratio _____
to such contribution as the balance of the Participant's combined Participant
Savings Account, Employer Contributions Account and Participant Investment
Income Account at the end of the prior accounting period bears to the balances
of all Participants in the three accounts of the General Fund at the end of the
prior accounting period.
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(2) A Participant shall be eligible to
share the allocation of the Employer Basic Contribution for the Plan Year only
if (A) the Participant has an Employer Contribution Account in the General Fund
on January 1 of the Plan Year following the Plan Year for which the Employer's
Basic Contribution is made and (B) the Participant in fact made one or more
voluntary savings contributions pursuant to Article III (including weekly cash
payments in lieu of payroll deductions pursuant to the subsections 3.2(b) and
(c)) which were allocated to his or her Participant Savings Account for the Plan
Year for which the Employer Basic Contribution is being made.
(3) Notwithstanding the foregoing, no
amount in excess of four thousand dollars ($4,000) shall be allocated to a
Participant as an Employer Basic Contribution with respect to any calendar year,
and if the Participant ceased participation during a calendar year the four
thousand dollar limit shall be reduced to an amount which shall be determined by
multiplying the four thousand dollar limit by a fraction, the numerator of which
is the number of wholly or partially completed calendar months of participation
during said calendar year, and the denominator of which is 12. Any amount in
excess of the dollar limitations determined under the preceding sentences shall
reduce the Employer's Tentative Basic Contribution to arrive at the Employer's
Basic Contribution to be made under the Plan.
(4) Effective for the Employer Basic
Contribution for the 1994 and subsequent Plan Years, that portion of the
Employer Benefit Contribution allocated to the account of a Participant who is a
Highly Compensated Employee, which, when combined with the Participant's
voluntary savings contributions pursuant to Article III, exceeds the
contribution limitations for Highly Compensated Employees pursuant to Section
6.2 shall be distributed to such Participant in accordance with the provisions
of that Section.
Section 5.7 Reserved.
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ARTICLE VI
LIMITATION ON ALLOCATION OF EMPLOYER CONTRIBUTIONS
Section 6.1 Limitation On Contributions on Behalf of Individual
Employees.
(a) General Limitation. For limitation years
commencing after December 31, 1982, and before January 1, 1998, the annual
addition in any limitation year to the account of a Participant, when added to
any annual additions on behalf of the Participant under any other defined
contribution pension plans maintained by the Employer, may not exceed the lesser
of: (1) $30,000 or (2) 25% of that Participant's total compensation received
from the Employer for the limitation year with respect to which the annual
addition is made. For purposes of the foregoing sentence, "total compensation"
means the Participant's taxable compensation from the Employer reported on Form
W-2 for the Plan Year or, as determined by the Committee in a uniform manner
with respect to all Employees for the Plan Year, such other nondiscriminatory
definition of compensation that satisfies the requirements Treas. Reg. 1.415-2
(d).
(b) Limitation for Post-1997 Years. For
limitation years commencing after December 31, 1997, the annual addition in any
limitation year to the account of a Participant, when added to any annual
additions on behalf of the Participant under any other defined contribution
pension plans maintained by the Employer, may not exceed the lesser of: (1)
$30,000 or (2) 25% of that Participant's total compensation received from the
Employer for the limitation year with respect to which the annual addition is
made. For Purposes of the foregoing sentence, "total compensation" means the
Participant's taxable compensation from the Employer reported on Form W-2 for
the Plan Year, increased by the amount of any contributions made on a pre-tax
basis to any other qualified benefit plan or plan described in IRC section 125
of the employer.
(c) Annual Addition. For purposes of this
Section, the term "annual addition" means the sum of the following credited to a
Participant's account for any limitation year:
(1) the Employer's contributions;
(2) the Employee's contributions; and
(3) forfeitures.
(d) Limitation--Two Types of Plans. In any case
in which a Participant has at any time participated in this Plan and a defined
benefit plan maintained by the Employer, the sum of
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the defined contribution fraction and the defined benefit fraction for any
limitation year commencing before January 1, 1983, may not exceed 1.4; and for
any limitation year commencing after December 31, 1982, may not exceed 1.0. For
limitation years commencing after December 31, 1999, the provisions of this
Article VI Section 1 (d)-(k) shall not apply.
(1) The defined benefit fraction applicable to a
Participant for any limitation year is a fraction, (A) the numerator of which is
the projected annual benefit of the Participant, determined as of the close of
the limitation year, under all defined benefit plans maintained by the Employer;
and (B) the denominator of which is:
(i) for limitation years commencing
before January 1, 1983, the projected annual benefit of the Participant under
such defined benefit plans as of the close of the limitation year if such plans
provide such Participant the maximum benefit allowable by law, or
(ii) for limitation years commencing
after December 31, 1982, the lesser of (I) of product of 1.25 multiplied by the
dollar limitation in effect under Section 415(b)(1)(A) of the Code for such year
(including any adjustment required or permitted by Section 235(g)(4) of the Tax
Equity and Fiscal Responsibility Act of 1982) or, (ii) the product of 1.4
multiplied by an amount equal to 100% of the Participant's average compensation
for three consecutive calendar years during which he or she participated in the
Plan and in which he or she had the greatest aggregate compensation from the
Employer.
(2) The defined contribution fraction applicable
to a Participant for any limitation year is a fraction, (A) the numerator of
which is the sum of the annual additions to the Participant's accounts,
determined as of the close of the limitation year, under all defined
contribution plans maintained by the Employer; and (B) the denominator of which
is:
(i) for limitation years commencing
before January 1, 1983, the maximum amount of annual additions allowable by law
to the Participant's accounts for the limitation year and for each prior
limitation year of the Participants' service with the Employer (regardless of
whether a Plan was in existence during those years); or
(ii) for limitation years commencing
after December 31, 1982, the sum of the lesser of the following amounts
determined for the present limitation year and each prior limitation year of the
Participant's service with the Employer:
(I) 1.25 multiplied by the dollar
limitation in effect under Section 415(c)(1)(A) of the Code for such limitation
year; or
(II) 1.4 multiplied by 25% of the
Participant's compensation for such limitation year.
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(e) Elective Limitation. At the election of the
Plan Administrator, the denominator of the defined contribution fraction for any
limitation year ending after December 31, 1982, with respect to each Participant
for all limitation years ending before January 1, 1983, shall be an amount equal
to:
(1) The amount determined in Section
6.2(c)(2)(B)(i) for the limitation year ending in 1982;
(2) Multiplied by a fraction:
(A) the numerator of which is the
lesser of (i) $51,875 or (ii) 1.4 multiplied by 25% of the Participant's
compensation for the limitation year ending in 1981, and
(B) the denominator of which is the
lesser of (i) $41,500 or (ii) 25% of the compensation of the Participant for the
limitation year ending in 1981.
(f) Limitation Adjustment. The rate of annual
additions to a Participant's account will be frozen or reduced to a level
necessary to prevent the limitations of this Section (other than the limitations
set forth in subsection (c) of this Section) from being exceeded with respect to
any Participant. The excess shall be reallocated among the accounts of the
remaining Participants in the same manner that Employer contributions are
allocated as set forth in Section 5.6 hereof, subject to the limitations imposed
by this Section. In the event that the Employer maintains another defined
contribution plan, and the limitations of this Section will be exceeded with
respect to any Participant upon considering the two defined contribution plans
as one plan, the annual additions to this Plan shall be frozen or reduced to
prevent any such excess.
(g) Single Plan Rule. For purposes of this
Section, all defined contribution plans (whether or not terminated) of the
Employer are to be treated as one defined contribution plan.
(h) Automatic Adjustment. The limitations
imposed by this Section shall be adjusted automatically when permitted or as
required by law.
(i) Limitation Year. For purposes of this
Section, the limitation year is the calendar year.
(j) Employer. For purposes of this Section,
"Employer" means the Employer and all Related Employers.
(k) Transitional Rule. The numerator of the
defined contribution fraction shall, if necessary, be adjusted as permitted by
Treasury Regulations so that the sum of the defined benefit fraction and the
defined contribution fraction does not exceed 1.0 for the last limitation year
beginning before January 1, 1983.
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(l) Incorporation by Reference. Notwithstanding
anything to the contrary in this Section 6.2, the maximum limitations on
contributions on behalf of individual Participants shall be in accordance with
Code Section 415 and the regulations thereunder, which are incorporated into
this Plan by reference.
Section 6.2 Contribution Limitations Under Section 401(m) of the Code.
(a) Average Contribution Percentage Test. The "Average
Contribution Percentage", as determined under subsection (b), for the group of
Employees who are Highly Compensated Employees shall not exceed for any Plan
Year after 1993 the greater of
(1) The Average Contribution Percentage for the
group of Non-Highly Compensated Employees times 1.25; or
(2) The Average Contribution Percentage for the
group of Non-Highly Compensated Employees times 2.0; provided, however, that
the Average Contribution Percentage for the group of Highly Compensated
Employees does not exceed the Average Contribution Percentage for the group of
Non-Highly Compensated Employees by more than two percentage points.
For purposes of the foregoing tests and subsection (b), an "Employee"
includes any Employee eligible to make voluntary savings contributions pursuant
to Article III at any time during the Plan Year, even if he or she in fact
declined to make such contributions. In addition, to the extent prohibited by
Treasury regulations, paragraph (2) of this subsection (a) may not be applied
to satisfy both the Average Contribution Percentage described above and the
average deferral percentage test with respect to a cash or deferred arrangement
under Code Section 401(k) maintained by an Employer or Related Employer.
(b) Excess Contributions. The Average Contribution Percentage
for a specified group of Employees for a Plan Year shall be the average of the
ratios (calculated separately for each Employee in such group) of:
(1) The sum of (i) the Employee's voluntary savings
contributions (pursuant to Article III) and (ii) the Employee's share of
Employer Basic Contribution or Imputed Employer Contribution, as the case may
be, actually paid to the Trustee on behalf of such Employee for such Plan Year
(together, "Aggregate Contributions"), to
(2) his or her Compensation for the Plan Year.
For the purpose of determining the above-described ratio
("Contribution Percentage") with respect to a Highly Compensated Employee, for
years beginning prior to January 1,
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1997, the Aggregate Contributions and Compensation of such Highly Compensated
Employee shall include the Aggregate Contributions and Compensation of said
Employee's family members (as described in Code Section 414(q)(6)(B)), and such
affected family members shall be disregarded in determining the Average
Contribution Percentage for the group of a Non-Highly Compensated Employees.
There will be no such aggregation for years beginning after December 31, 1996.
(c) If more than one plan providing for matching
contributions or employee contributions (within the meaning of Section 401(m)
of the Code) is maintained by the Employer or a Related Employer (other than a
plan which is not permitted to be aggregated with this Plan under Treas. Reg.
ss.1.401(m)-1(b)(3)(ii)), the individual ratio of any Highly Compensated
Employee who participates in more than one such plan shall, for purposes of
determining the individual's Contribution Percentage, be determined as if all
such plans were a single plan with respect to the Plan Years ending with or
within the same calendar year. Notwithstanding the foregoing, for any plan year
beginning January 1, 1997 or after, the Plan will use the actual contribution
percentage for participants who are Highly Compensated Employees for the
current plan year, and the prior year's actual contribution percentage for
participants who were Non-Highly Compensated Employees for the preceding plan
year in performing the nondiscrimination testing required under IRC section
401(m)(2) for the current plan year. Furthermore, the provisions of IRC section
401(m)(2) as amended by the Small Business Job Protection Act and the
regulations thereunder, as well as any subsequent Internal Revenue Service
guidance issued under the provisions of this section, are incorporated herein
by reference. The testing method used for purposes of the ACP test shall be the
prior year testing method.
(d) The Committee shall have the responsibility of
determining the extent, if any, to which either of the tests described in
subsection (a) may not be met with respect to Employees' Average Contribution
Percentages. If, in the discretion of the Committee, it is determined that
Aggregate Contributions made on behalf of Highly Compensated Employees do not
satisfy one of the tests in subsection (a), then Aggregate Contributions with
respect to Highly Compensated Employees shall be refunded in uniform percentage
increments, commencing with the Aggregate Contributions of the group of Highly
Compensated Employees with the highest percentages of Aggregate Contributions,
and then the Aggregate Contributions of the group of Highly Compensated
Employees with the next highest of such percentages, and so on, until it is
determined by the Committee that the Plan will satisfy one of the Average
Contribution Percentage tests set forth in subsection (a). Each reduction at a
stated percentage level will apply to all Highly Compensated Employees at that
level regardless of whether their Contribution Percentages have been reduced
from higher levels. The Committee shall accomplish the reductions as
-19-
described above by distributing to each affected Highly Compensated Employee
that portion of his or her Aggregate Contribution (plus any income and minus
any loss allocable thereto in a manner consistent with Treasury regulations, if
any) necessary to meet the requirements of one of the Average Contribution
Percentage tests in subsection (a) on or before March 15 of the following Plan
Year. If such distribution is not made, it must in all events be made no later
than the close of said following Plan Year. Notwithstanding the foregoing, for
Plan years beginning on or after January 1, 1997, the Excess Aggregate
Contributions will be calculated and distributed according to the following
procedures: (1) The ratio leveling method described in section (d) will be used
to determine the total dollar amount of excess aggregate contributions, (2) the
amount determined in step 1 is reduced beginning with the HCE with the highest
dollar amount of contributions to equal the dollar amount of the HCE with the
next highest dollar amount of contributions and continuing in succeeding order
of the HCE's until all excess aggregate contributions are accounted for as
determined in step 1. If these distributions are made, the ACP is treated as
meeting the nondiscrimination test of IRC section 401(m)(2) regardless of
whether the ACP, if recalculated after distributions would satisfy IRC section
401(m)(2). For purposes of IRC section 401(m)(9), if a corrective distribution
of excess aggregate contributions has been made, the ACP for HCE's is deemed to
be the largest amount under IRC 401(m)(2).
(e) Definitions. For purposes of this Section 6.2, the
following terms shall have the meanings set forth below:
(1) "Compensation" shall mean any of the following,
as determined by the Committee in a uniform manner with respect to all
Employees for the Plan Year:
(A) The Compensation or wages paid to an
Employee for the Plan Year by reason of his or her employment by the Employer
including overtime pay and commissions, before any payroll deductions,
including elective deferrals contributions and/or salary reduction
contributions, if any, to a plan or plans described in Section 125 or 401(k) of
the Code, but excluding bonuses, expense reimbursements and contributions
(other than elective deferral contributions to a cash or deferred arrangement
described in Section 401(k) of the Code) made by the Employer to any employee
benefit plan other than this Plan.
(B) The Employee's taxable compensation
from the Employer reported on Form W-2 for the Plan Year, or
(C) Such other nondiscriminatory definition
of compensation which satisfies the requirements of Code Section 414(s) and the
regulations hereunder.
-20-
Notwithstanding the foregoing, in no event shall the
Compensation of any Employee as determined for purposes of this Section 6.2 and
taken into account for any Plan Year exceed $150,000, increased by the
applicable cost-of-living adjustment, if any, for the calendar year sanctioned
by Code Section 401 (a)(17). In determining the Compensation of an Employee for
Plan Years beginning before January 1, 1997, any Compensation paid by the
Employer to the spouse or lineal descendant (who has not attained age 19 before
the close of the Plan Year) of an Employee who is (i) a 5% owner as defined in
Section 416 (i) of the Code or (ii) one of the 10 employees of the Employer
paid the greatest Compensation during the Plan Year shall be treated as
Compensation paid to such Employee. If, as the result of the application of the
foregoing sentence the applicable dollar limitation is exceeded, then such
limitation shall be prorated among the affected individuals in proportion to
each such individual's Compensation as determined for purposes of this Plan
prior to the application of the dollar limitation. For Plan Years that begin
after December 31, 1996, the Compensation aggregation rules discussed
previously in this paragraph do not apply.
(2) "Highly Compensated Employee" means, for Plan
Years beginning before January 1, 1997, with respect to a particular Plan Year,
an Employee who is not represented for purposes of collective bargaining by a
labor union and who (i) during the Plan Year or other "determination year" as
described in the regulations to Code Section 414(l) is among the 100 employees
receiving the most compensation from the Employer and is a highly compensated
employee as defined by Code Section 414(q) and the regulations thereunder or
(ii) during the 12-month period preceding the applicable determination year
(the "look-back year") is a highly compensated employee as defined in Code
Section 414(q) and the regulations thereunder. The Committee may, in its
discretion and consistent with regulations under Code Section 414(q) or other
guidance issued by the Secretary of the Treasury, elect to make a look-back
year calculation for a determination year on the basis of the calendar year
ending with or within the applicable determination year. For Plan Years
beginning after December 31, 1996, "Highly Compensated Employee" means, with
respect to any Plan Year, active employees who (1) was a 5-percent owner (as
defined in IRC section 416(i)(1)) of the employer at any time during the
determination year or the look-back year (the preceding 12 month period) , or
(2) for the look-back year had compensation from the employer in excess of
$80,000 (as adjusted by the Secretary pursuant to IRC section 415(d), except
that the base period shall be the calendar quarter ending September 30, 1995).
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(3) "Non-Highly Compensated Employee" means an
Employee who is not represented for purposes of collective bargaining by a
labor union, and who is not a Highly Compensated Employee as defined in (2)
above.
(4) "Aggregate Limit" shall mean the sum of (i) 125
percent of the greater of the Average Deferral Percentage of the Non-highly
Compensated Employees for the Plan Year or the Average Contribution Percentage
of Non-highly Compensated Employees under the plan subject to Code section
401(m), for the Plan Year beginning with or within the Plan Year of the CODA
and (ii) the lessor of 200% or two plus the lesser of such Average Deferral
Percentage or Average Contribution Percentage. `Lesser' is substituted for
`greater' in `(i)', above, and `greater' is substituted for `lesser' after `two
plus the' in `(ii)' if it would result in a larger Aggregate Limit.
(f) If one or more Highly Compensated Employees participate
in this Plan and a plan maintained by the Employer or a Related Employer that
contain a qualified cash or deferred arrangement (a "CODA"), as defined in Code
Section 401(k)(2), and the sum of the Average Deferral Percentage and Average
Contribution Percentage of those Highly Compensated Employees subject to either
or both tests exceeds the Aggregate Limit, then the Average Contribution
Percentage of those Highly Compensated Employees who also participate in a CODA
will be reduced (beginning with such Highly Compensated Employee whose Average
Contribution Percentage is the highest) so that the limit is not exceeded. The
amount by which each Highly Compensated Employee's Contribution Percentage
Amount is reduced shall be treated as an Excess Contribution. The Average
Deferral Percentage and Average Contribution Percentage of the Highly
Compensated Employees are determined after any corrections required to meet the
Average Deferral Percentage under any CODA maintained by the employer and
Average Contribution Percentage test under the Plan have been made. Multiple
use does not occur if either the Average Deferral Percentage or Average
Contribution Percentage of the Highly Compensated Employees does not exceed
1.25 multiplied by the Average Deferral Percentage and Average Contribution
Percentage of the Non-highly Compensated Employees.
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ARTICLE VII
RESERVED
-23-
ARTICLE VIII
VESTING
Section 8.1 Nonforfeitability of Participant's Accounts. Participants'
accounts in both Funds shall be fully vested and nonforfeitable at all times.
Any Participant in the Plan on the date of adoption of any
amendment to the vesting schedule may, within an election period which begins
on the date of adoption of such amendment to the vesting schedule and ends on
the sixtieth day after the latest of: (i) the date the amendment is adopted;
(ii) the date the amendment becomes effective; or (iii) the date the
Participant is given written notice of the amendment by the Committee, elect to
have his or her vested percentage determined under the vesting schedule as in
effect immediately prior to the effective date of amendment provided he or she
has completed three Years of Service prior to the end of the election period.
Any election made will be irrevocable. Further, no Participant shall have his
or her vested percentage decreased by any change in the vesting schedule.
-24-
ARTICLE IX
WITHDRAWALS
Section 9.1 Withdrawal of Participant Savings Account. Amounts
credited to the Participant Savings Account of a Participant, may be withdrawn
at any time during his lifetime upon application of the Participant to the
Committee. The amount which may be withdrawn, however, may not exceed the
excess of the sum of the amounts credited to the Participant Savings Account of
the Participant in the Fund over the allocable portion of the net deficit, if
any, in the Participant Investment Income Accounts of such Participant in such
Funds. The allocable portion of such net deficit will be determined in
accordance with the ratio which the amount credited to the Participant Savings
Account of the Participant bears to the total of the amounts credited to the
Participant Savings Account and the Employer Contributions Account of such
Participant in the Fund.
Section 9.2 Emergency Withdrawals. If a Participant establishes to the
satisfaction of the Committee that he is faced with a financial emergency or
necessity due to sickness or injury to himself or to one or more of his
dependents the Committee may approve withdrawals from accounts other than a
Participant Savings Account. The Committee, in its discretion, may grant the
application in whole or in part, and may provide for payment in a lump sum or
in installments. Payments shall be made under this Section only after all funds
from the Participant Savings Account of the Participant have been distributed
pursuant to Section 9.1.
Section 9.3 Further Withdrawals. Amounts in a Participant's Accounts,
other than in his Participant Savings Account, may also be withdrawn without
the consent of the Committee, provided that such amounts have been credited to
the Participant's account for two years or more. Notwithstanding the foregoing,
Plan Participants with at least 60 months of Plan participation may elect to
withdraw all amounts credited to his or her Employer Contribution Account and
Participant Investment Account.
Section 9.4 Payment of Withdrawn Amounts. Amounts withdrawn pursuant
to this Article IX shall be paid in cash. Notwithstanding the foregoing,
Participants electing a withdrawal pursuant to Section 9.3 may choose to
receive a portion of the withdrawal in UPS stock, subject to the following:
(a) the amount of stock available for withdrawal pursuant to
this Section, 9.4, shall be limited to the lesser of the following amounts:
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(i) the ratio of the value UPS Stock held by the
Plan to the total value of all Plan assets, computed as of the end of the month
preceding the month in which the distribution is processed, multiplied by the
amount of Participant's withdrawal election; or
(ii) the sum of the balances in the Participant's
Employer Contribution Account and Participant Investment Account.
(b) the value of the stock allocated to a Participant's
withdrawal pursuant to paragraph (a) above shall be distributed in-kind:
(i) in whole shares; and
(ii) provided the value of the in-kind distribution
is at least $500.
Section 9.5 Timing of Payment. Subject to the provisions of Section
9.6, payment of amounts applied for under this Article IX will be made within
fifteen (15) days after the end of the month following the month in which the
application is received by the Committee, except that amounts attributable to
Fund earnings or to Employer contributions which cannot be readily determined
at the end of an accounting period shall be paid within thirty (30) days after
such amounts have been determined.
Section 9.6 Waiting Period. The Committee, notwithstanding any other
provisions of this Article IX, may provide by uniform rules for a waiting
period of up to six months for the payment of any withdrawals.
Section 9.7 Applications for Withdrawal. All applications for
withdrawal under this Article IX shall be in writing, shall state the amount
sought to be withdrawn and shall set forth such other information as the
Committee shall prescribe.
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ARTICLE X
DISTRIBUTION ON TERMINATION OF REGULAR EMPLOYMENT
Section 10.1 Distribution of Account Balances - If a Participant
retires, dies or otherwise terminates Regular Employment (unless he is eligible
to make weekly cash payments and elects to do so in accordance with Section
3.2), all amounts standing to his credit under the Plan shall be distributed to
him or his designated beneficiary in accordance with the following terms and
conditions:
(a) General Rule. All amounts standing to the credit of a
Participant in the General Fund shall be distributed, in a single lump sum, to
the Participant or his beneficiary as soon as practicable after the January 1
following the calendar year in which the participant retires, dies, or
otherwise terminates Regular Employment (without having elected to make cash
payments in accordance with Section 3.2). Any such distribution to a
Participant shall require the Participant's written consent if made prior to
his attaining normal retirement age, which for purposes of the Plan shall be
age 62. Failure to consent shall be deemed to be an election to defer
distribution of the Participant's benefit, and all amounts standing to the
Participant's credit shall remain in the General Fund until a subsequent
consent to distribution is filed with the Committee, or the Participant attains
62 years of age. Notwithstanding the foregoing, if the value of the
Participant's accounts in the General Fund does not exceed $3,500 ($5,000 for
Plan Years beginning after December 31, 1997), said amounts shall be
distributed to the Participant or his beneficiary without such individual's
consent.
(b) Immediate Distribution Option. Following a Participant's
retirement, death or other termination of Regular Employment (unless he is
eligible to make weekly cash payments and elects to do so in accordance with
Section 3.2), the Participant or his beneficiary shall be permitted to elect,
in accordance with procedures established by the Committee, the immediate
distribution, in a single lump sum, of all amounts standing to the
Participant's credit in the General Fund. If such election is made, there shall
be distributed to the Participant or beneficiaries, as soon as practicable
following the Committee's receipt of the Participant's or beneficiary's
completed election, an amount equal to the balance standing to the credit of
the Participant in the General Fund.
(c) Repayment of Prior Distribution in Event of
Re-employment. If a former Participant, after receiving distribution of his
accounts pursuant to this Article X, returns to Regular Employment with the
Employer before the end of the 12-month period commencing on the date he
-27-
terminated Regular Employment, he shall be permitted to restore all, but not
less than all, of the amounts previously distributed to him, provided such
restoration is made in a lump sum within six (6) months after his date of
re-employment, and provided that such repayment is at least $1,000. Upon
repayment, the moneys previously distributed shall be credited to a newly
established Participant's Savings Account in the General Fund.
(d) Repayment of Prior Distribution in Event of Return to
Work following Disability or Leave or Absence Due to Health Reasons. If a
former Participant, after receiving distribution of his accounts pursuant to
this Article X, returns to Regular Employment with the Employer after a period
of disability or a leave of absence due to pregnancy, disability, or other
health or medical problems, he shall be permitted to restore all, but not less
than all, of the amounts, previously distributed to him, provided such
restoration is made in a lump sum within six (6) months after his date of
returning to Regular Employment, and provided that such repayment is at least
$1,000. Upon repayment, the moneys previously distributed shall be credited to
a newly established Participant's Savings Account in the General Fund.
Section 10.2 Methods of Distribution; Limitations Regarding Time of
Payment of Benefits.
(a) General Limitation. Distribution of amounts under this
Article X shall be made at the time or times provided in Section 10.1 in a lump
sum payment in cash, in kind, or both, in the sole discretion of the Committee,
and in no event shall distribution be made later than the 60th day after the
close of the Plan Year in which the latest of the following events occurs:
(1) the date on which the Participant attains age
65;
(2) the 10th anniversary of the year in which the
Participant commenced participation in the Plan; or
(3) the Participant terminates his or her service
with the Employer. A Participant will not be considered to have terminated his
or her service if he or she is eligible and elects to make weekly cash payments
in accordance with Section 3.2
(b) Mandatory Limitation.
(1) Commencement of Payments.
(A) Notwithstanding subsection (a), the
entire interest of a Participant shall be distributed no later than April 1 of
the calendar year following the calendar year in which he attains age 70 1/2;
provided however, that the interest of a Participant (other than an individual
who is or was a 5% owner, as defined in Code Section 416(i)(1)(B)(i) in any
Plan Year ending in the year the individual attained age 66 1/2 or any
succeeding Plan Year) who attained age 70 1/2 before January 1, 1988
-28-
shall not be required to begin to be distributed prior to April 1 of the
calendar year in which he retires or otherwise terminates employment.
(B) In the case of an Employee who is a
five percent owner of the Employer in the calendar year in which such Employee
attains age 70 1/2, his entire interest shall be distributed not later than the
April 1 following such calendar year.
(2) Transitional Rule. Any designation by a
Participant of a method of distribution permitted by this Plan which does not
meet the requirements of this subsection (b) will be honored, if such
designation had been submitted to the Plan Administrator prior to January 1,
1984.
(c) No distribution to Five Percent Owner Before Age 59 1/2.
Notwithstanding any other provision of this Plan, no distribution shall be made
to an Employee who is or has been a five percent owner, before such Employee
attains age 59 1/2, of any amount attributable to a contribution made on behalf
of such Employee which he was a Five Percent Owner, except in the case of his
death or disability.
(d) Five Percent Owner. For purposes of this Section, the
term "Five Percent Owner" means a person who owns more than five percent of the
outstanding stock of the Employer or stock possessing more than five percent of
the total combined voting power of all stock of the Employer. For purposes of
determining ownership in the Employer (i) the constructive ownership rules of
Section 318 of the code, as modified by substituting "five percent" for "fifty
percent" in subsection (a)(2)(C) thereof, shall apply, but (ii) the rules of
subsections (b), (c) and (m) of Section 414 of the code shall not apply.
Section 10.3 Payment to Beneficiary in Event of Death.
(a) General Rule. In the event of the death of a Participant
who on or after August 23, 1984 has at least one Hour of Service under the Plan
or one hour of paid leave, his or her vested benefits under the Plan shall be
payable in full to his surviving spouse unless:
(1) there is no surviving spouse; or
(2) the Participant has elected not to have such
benefits payable to his or her surviving spouse and the surviving spouse has
consented to the Waiver Election in the manner required by subsection (b).
(b) "Waiver Election" means an election to waive any benefits
for a spouse under the Plan, but only if the spouse of the Participant consents
to the election and such consent: (i) is in writing, (ii) acknowledges the
effect of the election, including the identity of the alternate survivor
beneficiary, and (iii) is witnessed by a notary public. If a married
Participant, following a Waiver Election, changes the identity of the alternate
survivor beneficiary, the spouse must consent to such change in the
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foregoing manner, unless the spouse's original consent specifically authorized
the Participant to make subsequent beneficiary changes without spousal consent.
(c) Non-Spousal Beneficiary. Each Participant or former
Participant shall be entitled to designate a contingent beneficiary or
beneficiaries who are to receive the distributions provided under the Plan in
the event that the Participant's spouse does not survive him or the Participant
has executed a Waiver election in accordance with subsection (b) with spousal
consent. A Participant may change the designation of the contingent beneficiary
from time to time. No such designation or change therein shall be effective
until received by the Committee and unless it is received by the Committee
prior to the Participant's death and unless made on forms prescribed by the
Committee. In the event that a Participant fails to designate a contingent
beneficiary or if a designated beneficiary does not survive the Participant,
payment will be made to the spouse of the deceased Participant, if any, but if
none survives the Participant, to his surviving children. If no children
survive the Participant, payment will be made to the Participant's estate. If a
beneficiary who has begun to receive payments pursuant to this Article X dies
before all payments are made, and no successor beneficiary was named by the
Participant, the balance shall be paid in a lump sum to the person entitled by
law to receive the property of the deceased beneficiary.
Section 10.4 Reserved.
Section 10.5 Direct Rollover.
(a) With respect to any distribution described in this Plan
which constitutes an eligible rollover distribution within the meaning of Code
Section 401(a)(31)(C), the distributee thereof shall, in accordance with
procedures established by the Committee, be afforded the opportunity to direct
that such distribution be transferred directly to the trustee of an eligible
retirement plan (a "direct rollover"). For purposes of the foregoing sentence,
an "eligible retirement plan" is (1) a qualified trust within the meaning of
Code Section 402 which is a defined contribution plan the terms of which permit
the acceptance of rollover distributions, (2) an individual retirement account
or annuity within the meaning of Code Section 408 (other than an endowment
contract), or (3) an annuity plan within the meaning of Code Section 403(a),
which is specified by the distributee in such form and at such time as the
Committee may prescribe.
(b) Notwithstanding the foregoing, if the distributee elects
to have his or her eligible rollover distribution paid in part to him or her
and paid in part as a direct rollover:
(A) The direct rollover must be in an amount of $200
or more.
(B) A direct rollover to two or more eligible
retirement plans shall not be permitted. Notwithstanding the foregoing, and
subject to the limitation in subparagraph (A) above, a
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Participant receiving an in-kind distribution or withdrawal may elect to
rollover the in-kind and cash portions of the distribution or withdrawal to
separate eligible retirement plans, provided that, the number of eligible
retirement plans selected does not exceed two.
(c) The Committee shall, within a reasonable period of time
prior to making an eligible rollover distribution from this Plan, provide a
written explanation to the distributee of the direct rollover option described
above, as well as the provisions under which such distribution will not be
subject to tax if transferred to an eligible retirement plan within 60 days
after the date on which the distributee received the distribution.
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ARTICLE XI
LOANS
Effective September 30, 1995, no further loans shall be made by the Committee.
Section 11.1 Committee May Make Loans. If a Participant, upon written
application to the Committee, establishes to the satisfaction of the Committee
that the Participant is faced with a financial emergency or necessity due to
personal sickness or injury (including but not limited to funeral expenses and
expenses associated with long term custodial care in a nursing home or similar
institution) to himself or that of one or more of his spouse, or other
dependents, his or her spouse's parents, his lineal descendants, or the spouse
of such lineal descendants, the Committee may approve and make a loan to such
Participant subject to the following terms and conditions:
(a) The aggregate amount of all loans to a Participant under
this Plan and any other plans of the Employer or a Related Employer ("Aggregate
Loans"), may not exceed the lesser of (i) $50,000, reduced by the excess (if
any) of the highest outstanding balance of Aggregate Loans during the one-year
period ending on the day before the date on which the loan is made over the
outstanding balance of Aggregate Loans on the date the loan was made; or (ii)
one-half of the value of the Participant's Accounts under the Plan as of the
date of the loan.
(b) The maximum term of any loan, including extensions, shall
not exceed three (3) years.
(c) Each loan shall be evidenced by a promissory note in a
form approved by the Committee, which shall provide for repayments no less
frequently than quarterly which represent the substantially level amortization
of the loan over its term. The promissory note may provide for reasonable
penalty charges if a repayment is more than 10 days late. The Committee shall,
to the extent practicable, require the repayment of a loan by means of payroll
deductions.
(d) Each loan shall bear interest at a rate equal to the
highest prime rate, plus one percentage point, published in The Wall Street
Journal on the date of the loan.
(e) Each loan to a Participant shall be secured by the
balances in each of the Participant's Accounts under the Plan.
(f) Effective for reemployments commencing on or after
December 12, 1994, loan repayments for any loan granted by the committee under
this Article XI will be suspended
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under this plan for periods of qualified military service as permitted under
IRC section 414(u)(4), the provisions of which are hereby incorporated by
reference.
Section 11.2 Administration of Loan Program. The determination whether
a Participant satisfies the criteria for a loan shall be made by the Committee,
which shall administer the loan program. All requests for loans hereunder shall
be directed in writing to the Committee, which may prescribe an application
form for this purpose. The Committee may request such information and
documentation as it deems necessary to ascertain the qualification of a
Participant for a loan in accordance with this Article XI. The Committee shall
normally determine whether a Participant qualifies for a loan within 30 days of
its receipt of a completed loan application, unless it advises the Participant
in writing that additional time or information is needed. Loans shall be made
available on a reasonably equivalent basis to all Participants and
beneficiaries who satisfy the criteria for a loan described in Section 11.1,
although the Committee may decline to make a loan to any individual who is not
a party in interest, as described in Section 3(14) of ERISA.
Section 11.3 Default; Payment upon Termination of Employment. In the
event that a Participant's schedule loan payment is more than 60 days late, the
Committee may declare the loan to be in default. The Committee shall take such
reasonable steps as it deems necessary to secure repayment of the remaining
loan principal, accrued interest (including reasonable interest, as determined
by the Committee, on interest which is not timely paid), and penalty charges,
including but not limited to the reduction, consistent with the restrictions on
in-service withdrawals described in Sections 9.1 and 9.3 of the Participant's
Account balance or legal action to garnish the Participant's salary or wages.
If the Participant has separated from service with the Employer and is entitled
to a distribution (even if he does not consent to the immediate payment
thereof), any outstanding loan in default shall be considered immediately due
and payable, and the amount of such Participant's Account balances shall be
reduced prior to distribution by the entire amount of outstanding loan
principal, accrued interest and penalty charges, if any.
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ARTICLE XII
ADMINISTRATIVE COMMITTEE
Section 12.1 Administrative Committee. The Plan shall be administered
by an Administrative Committee consisting of not less than three members, each
of whom is and shall be the "named fiduciary" with respect to the Plan, who
shall be appointed by the Board of Directors. The Committee shall be the "Plan
Administrator" of the Plan as that term is used in ERISA, and the agent of a
service of process on or with respect to the Plan.
Section 12.2 Vacancies on Committee. Committee members shall serve at
the pleasure of the Board of Directors, and all vacancies shall be filled by
the Board of Directors. Committee members may resign at any time, such
resignation to be effective when accepted by the Board of Directors.
Section 12.3 Authority of Committee. The Committee shall establish
rules for the administration of the Plan, and shall decide all questions
arising in the administration of the Plan, including but not limited to making
determinations on the following subjects: (a) eligibility for Participation;
(b) the length of employment of Participants; (c) appraisal of assets; (d) the
length of an accounting period; (e) withdrawals for financial necessity; (f)
loans and the rate of interest thereon; (g) general investment guidelines
established consistent with Section 13.1; and (h) all other matters affecting
the administration and operation of the Plan not specifically delegated or
reserved to the Board of Directors, to an Employer, or to the Trustee. Subject
to the provisions of Section 12.5, all determinations by the Committee shall be
final and binding on all persons. In all such actions, the Committee shall act
by rules uniformly applied to all persons.
Section 12.4 Action by Majority of Committee. The Committee
shall act by a majority of the Committee members at the time in office. Such
action may be taken either by a vote at a meeting or in writing without a
meeting. The Committee may appoint subcommittees and also may authorize any one
or more of the Committee members or any agent to execute any document or
documents or to take any other action on behalf of the Committee, except that
no member of the Committee shall have the right to take any such action on any
matter relating solely to himself or to any of his rights or benefits under the
Plan.
Section 12.5 Claims Procedure.
(a) All claims for benefits hereunder shall be directed to
the Committee or to a member of the Committee designated for that purpose.
Within ninety (90) days following receipt of a claim for benefits, the
Committee shall determine whether the claimant is entitled to benefits under
the Plan, unless additional time is required for processing the claim. In this
event, the Committee shall, within the
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initial ninety-day period, notify the claimant that additional time is needed,
explain the reason for the extension, and indicate when a decision on the claim
will be made, which must be within 180 days of the date the claim is filed.
(b) A denial by the Committee of a claim for benefits shall
be stated in writing and delivered or mailed to the claimant. Such notice shall
set forth the specific reasons for the denial, written in a manner calculated
to be understood by the claimant without benefit of legal or actuarial counsel.
The notice shall include specific reference to the Plan provisions on which the
denial is based and a description of any additional material or information
necessary to perfect the claim, an explanation of why this material or
information is necessary, and the steps to be taken if the claimant wishes to
submit his claim for review.
(c) The Committee shall afford a reasonable opportunity to
any claimant whose request for benefits has been denied for a review of the
decision denying the claim. The review must be requested by written application
to the Committee within sixty days following receipt by the claimant of written
notification of denial of his claim. Pursuant to this review, the claimant or
his duly authorized representative may review any documents which are pertinent
to the denied claim and submit issues and comments in writing.
(d) A decision on the claimant's appeal of the denial of
benefits shall ordinarily be made by the Committee within sixty (60) days of
the receipt of the request for review, unless additional time is required for a
decision on review, in which event the decision shall be reviewed not later
than 120 days after receipt of request for ruling. Notice in writing of the
extended time required shall be given to the claimant within sixty days of his
request for review.
The decision on review shall be in writing and shall include
specific reasons for the decision, written in a manner calculated to be
understood by the claimant, and specific reference to the Plan provisions on
which the decision is based.
Section 12.6 Liability of the Committee. The Committee and the members
thereof, to the extent of the exercise of their authority, shall discharge
their duties with respect to the Plan solely in the interests of the Plan's
Participants and their beneficiaries, and for the exclusive purpose of
providing benefits thereto in accordance with the terms of the Plan and to
defray the reasonable administration expenses thereof. In all such action or
omissions the Committee and each member thereof shall exercise 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 the
conduct of an enterprise of like character and with like aims; provided,
however, that no member shall be responsible for the actions or omissions of a
member
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of any other party that is a fiduciary with respect to this Plan, other than
himself, which are not in conformity hereto, unless (1) such member knowingly
participates in or knowingly conceals such conduct which he knows to be in
breach of this standard, (2) his own conduct has enabled the other member or
other fiduciary to be in breach of this standard, or (3) he has knowledge of
such breach by another member or other fiduciary and fails to make reasonable
efforts under the circumstances to remedy such breach.
Section 12.7 Authority to Appoint Officers and Advisors. The Committee
may appoint such officers as it may deem advisable and may adopt by-laws
covering the transaction of its business. The Committee may appoint and employ
an investment manager, an actuary, counsel (who is not an employee of the
Employer), agents and such other clerical, medical, accounting and advisory
services as it may require in carrying out the provisions of the Plan, and
shall be fully protected in relying upon any action taken in reliance upon
advice given by such persons.
Section 12.8 Committee Meeting. The Committee shall hold meetings upon
such notice, at such place or places, and at such time or times as it may
determine from time to time, but not less frequently than once each calendar
quarter. Notice of a meeting may be waived in writing.
Section 12.9 Compensation and Expenses of Committee. The members of
the Committee may receive reasonable compensation for their services as the
Board of Directors from time to time may determine. Such compensation and all
other expense of the Committee, including the compensation of officers,
actuaries or counsel, agents or others that the Committee may employ, shall be
paid out of the assets of the Trust to the extent not paid by the Employer.
Notwithstanding the foregoing, any Committee member who is employed on a
full-time basis by an Employer shall receive no compensation, but may be
reimbursed for expenses incurred.
Section 12.10 Records. The Committee shall keep or cause to be kept
accurate and complete books and records.
Section 12.11 Forfeiture in Case of Unlocatable Participant. If the
Committee is unable to pay any benefits under the Plan to any Participant or to
a beneficiary of any Participant who is entitled to benefits hereunder because
the location of such person cannot be ascertained, the Committee shall proceed
as follows:
(a) Within ninety (90) days of the date any such benefits are
payable, the Committee shall send an appropriate notice to such individual, at
the last address for such individual listed in the Committee's records.
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(b) If this notice is returned as unclaimed or the individual
cannot be located during the next 90 days, the Committee will attempt to locate
such individual through a commercial locator service
(c) If the individual has not been located by December 31 of
the calendar year following the calendar year in which the benefits became
payable, all amounts held for his or her benefit shall be forfeited and all
liability for payment thereof shall thereupon terminate, unless some other
procedure is permitted or required by law. In any such case, the funds released
as a result of such forfeiture shall be treated as additional investment
income. However, if an individual subsequently makes what the Committee
determines to be a valid and proper claim to the Committee for such amounts,
the account or accounts shall be restored and will be distributed in accordance
with the terms of this Plan.
Section 12.12 Fiduciary Responsibility Insurance, Bonding. If the
Employer has not done so, the Committee may purchase appropriate insurance on
behalf of the Plan and the Plan's fiduciaries, including the members of the
Committee, to cover liability or losses occurring by reason of the acts or
omissions of a fiduciary; provided, however, that such insurance to the extent
purchased by the Plan must permit recourse by the insurer against the fiduciary
in the case of a breach of a fiduciary duty or obligation by such fiduciary.
The cost of such insurance shall be borne by the Fund, unless the insurance is
provided and paid for by the Employer Company. The Committee shall also, if the
Employer has not done so, obtain a bond covering all of the Plan's fiduciaries,
to be paid from the assets of the Trust Fund.
Section 12.13 Delegation of Specific Responsibilities. The members of
the Committee may agree in writing signed by each member to allocate to any one
of their number or to other persons (including corporations) any of the
responsibilities with which they are charged pursuant hereto, including the
appointment of an investment manager to manage the Trust Fund, provided the
responsibilities and duties so delegated are definitively set forth so that the
person to whom the delegation is made is clearly aware of such duties and
responsibilities. If such delegation is made to a person not a member of the
Committee, that person or, in the case of a corporation, its responsible
officer, shall acknowledge the acceptance and understanding of such duties and
responsibilities.
Section 12.14 Allocation of Responsibility Among Fiduciaries for Plan
and Trust Administration. The fiduciaries hereunder, including the Trustee, the
Employers, the Board of Directors and the Committee, shall have only those
specific powers, duties, responsibilities and obligations as are specifically
given them under this Plan or the Trust Agreement. In general, the Employers
shall make the contributions provided for under Article IV of the Plan and
shall have the right to terminate the Plan, and the Board of Directors shall
have the sole authority to appoint and remove the Trustee, members of the
Committee and
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any Investment Manager which may be provided for under the Trust, and to amend
this Plan or the Trust, except as otherwise provided. The Committee shall have
the sole responsibility for the administration of this Plan, which
responsibility is specifically described in this Plan and the Trust. Subject to
any direction from the Committee, the Trustee shall have responsibility for the
administration of the Trust and the management of the assets held under the
Trust, all as specifically provided in the Trust. Each fiduciary warrants that
any directions given, information furnished, or action taken by it shall be in
accordance with the provisions of the Plan or the Trust, as the case may be,
authorizing or providing for such direction, information or action.
Furthermore, each fiduciary may rely upon any such direction, information or
action of another fiduciary as being proper under this Plan or the Trust, and
is not required under this Plan or the Trust to inquire into the propriety of
any such direction, information or action. It is intended under this Plan and
the Trust that each fiduciary shall be responsible for the proper exercise of
its own powers, duties, responsibilities and obligations under this Plan and
the Trust and shall not be responsible for any act or failure to act of another
fiduciary. No fiduciary guarantees the Trust Fund in any manner against
investment loss or depreciation in asset value.
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ARTICLE XIII
INVESTMENTS
Section 13.1 Committee to Direct Investments. The Committee except to
the extent it has expressly delegated such authority to the Trustees or to an
investment manager, shall have full and exclusive power and authority to direct
the Trustee as to the investment of the assets of the Trust, and the Trustee
shall invest, reinvest, buy, sell, hypothecate or otherwise deal with the
assets of the Trust in accordance with the Committee's directions. Such
directions shall be certified in writing by two members of the Committee.
Investments shall not be restricted to investments now or hereafter legal for
trust funds under the laws of the states of Connecticut, New York or New Jersey
or any other jurisdiction. The Committee, in directing the investment and
reinvestment of the assets of the Trust shall, subject to and in accordance
with the provisions of Section 13.4, direct investments as provided in Sections
13.2, 13.3 and 13.5 to the extent permitted by law.
Section 13.2 Investment of the General Fund. The General Fund, subject
to the provisions of Section 13.4(b) shall be invested in the following:
(a) Qualifying employer securities, as defined in Section
407(d)(5) of ERISA;
(b) Qualifying employer real property, as defined in Section
407(d)(4) of ERISA; and
(c) Other securities and other investments as directed by the
Committee,
including but not limited to common trust funds and collective employee benefit
trusts of the Trustee and contributions to the capital of any corporation all
of whose stock is owned by the Trustee.
Section 13.3 Reserved.
Section 13.4 Seventy-Five Percent Limitation.
(a) In directing the investment of the assets of the Trust,
the Committee may direct the investment of up to seventy-five percent (75%) of
the total assets of the Trust in the investments described in Section 13.2(a)
and/or (b); except that such investments may constitute less than such
percentage of the total assets of the Trust;
(1) To the extent required in order that
contributions by the Employers to the Plan will be deductible under the
Internal Revenue Code, or to qualify or maintain the qualification of the Plan
under the Code or to establish or maintain the exempt status of the Trust under
the Code; or
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(2) To the extent required to maintain and preserve
liquidity to permit distributions in accordance with the terms of Plan, or to
provide suitable temporary investments for the assets of the Trust; or
(3) To the extent otherwise directed by the Board of
Directors.
(b) In no event shall the total amount invested at any time
in any investments described in Section 13.2(a) exceed the excess of the
aggregate of all the individual Employer Contributions Accounts in the General
Fund over the allocable portion of the net deficit, if any, in the aggregate of
all the individual Participant Investment Income Accounts in the General Fund
at such time. The allocable portion of such net deficit will be determined in
accordance with the ratio which the sum of the amounts credited to all the
individual Employer Contribution Accounts in the General Fund bears to the
total of the amounts credited to all the individual Participant Savings
Accounts and all the Individual Employer Contribution Accounts in the General
Fund at such time.
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ARTICLE XIV
CERTAIN RIGHTS AND OBLIGATIONS OF THE EMPLOYER COMPANIES
Section 14.1 No Liability of Employers for Payments Under Plan. It is
the intention of the Employers to continue the Plan either in its present or
amended form and to make contributions to the Plan each year. Under no
circumstances shall any liability attach to any Employer for payment of any
benefits or claims hereunder and every Participant, beneficiary, or person
claiming under them shall have recourse only to the Trust for payment of any
benefits hereunder, and the rights of such Participants, beneficiaries, or
persons claiming under them are hereby expressly limited accordingly.
Section 14.2 Right to Terminate Plan. Nothing contained in the Plan or
the Trust Agreement shall prevent the termination of the Plan at any time by
any one or more of the Employers, with respect to the Participants employed by
such Employers.
Section 14.3 Notice of Termination. Notice of termination of the Plan,
in whole or in part, shall be deemed adequately given if an Employer or the
Committee mails written notice of the same, postage prepaid, to the latest
address on file of each Participant who is affected by such termination; or by
such other means as may be permitted or prescribed by ERISA or regulations or
rulings implementing the provisions of ERISA.
Section 14.4 No Right to Employment. The establishment of this Plan
shall not be construed as conferring any legal or other rights upon any
Employee or any person for a continuation of employment, nor shall it interfere
with the rights of an Employer to discharge any Employee or otherwise act with
relation to him.
Section 14.5 Receipt for Final Payment. Any final payment or
distribution to any Participant, a legal representative or beneficiary of a
Participant, or anyone claiming under them, in accordance with this Plan shall
be in full satisfaction of all claims against the Trust, the Trustee, the
Committee, any Employer, and all representatives, officers, employees and
agents thereof. The person receiving the payment or distribution may be
required to execute a receipt and release of all claims under the Plan upon a
final payment or distribution or a receipt and release to the extent of any
partial payment or distribution. The form and content of such receipt or
release shall be determined by the Committee.
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ARTICLE XV
NONALIENATION OF BENEFITS
Section 15.1 Nonalienation of Benefits. No benefit or payment under
the Plan, except in connection with loans provided for in Article XI, shall be
subject in any manner to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance, levy or charge, and any attempt so to anticipate,
alienate, sell, transfer, assign, pledge, encumber, levy upon or charge the
same shall be void.
The restrictions of this Section will not be violated by either (a)
the creation of a right to payments from this Plan by reason of a Qualified
Domestic Relations Order or (b) the making of such payments.
For purposes of this Section, the term "Qualified Domestic Relations
Order" means any judgment, decree, or order (including approval of a property
settlement agreement), made pursuant to a State domestic relations law
(including a community property law), which relates to the provision of child
support, alimony payments, or marital property rights to a spouse, former
spouse, child, or other dependent of a Participant (an "Alternate Payee") and
which:
(a) creates or recognizes the right of an Alternate Payee to,
or assigns to any alternate Payee the right to, receive all or a portion of the
benefits payable with respect to a Participant under this Plan;
(b) clearly specifies (i) 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, (ii) the amount or percentage of the
Participant's benefits to be paid by the Plan to each Alternate Payee, or the
manner in which such amount or percentage is to be determined, (iii) the number
of payments or period to which such order applies, and (iv) that the order
applies to this Plan;
(c) does not require this Plan to provide any type or form of
benefit, or any option, not otherwise provided under this Plan, except that,
any interest in a Participant's Accounts, including his Employer Contribution
Account and Investment Income Account in the Fund, awarded to an Alternate
Payee, may be distributed to or on behalf of the Alternate Payee as soon as
practicable following the Committee's approval of the Qualified Domestic
Relations Order;
(d) does not require this Plan to provide increased benefits
(determined on the basis of actuarial equivalence); and
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(e) does not require the 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.
The Committee shall develop and implement procedures (a) for
determining whether an order received by the Plan is a "Qualified Domestic
Relations order" within the meaning of this Section, (b) for administering
distributions under such orders, and (c) for holding amounts which would be
payable under such orders pending the determination described in clause (a) of
this paragraph.
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ARTICLE XVI
AMENDMENTS; MERGER
Section 16.1 Right to Amend. The Board of Directors may modify or
amend in whole or in part any or all of the provisions of the Plan. Such
amendments or modifications may be made retroactive if necessary or appropriate
to qualify or maintain the qualification of the Plan under the requirements of
Section 401 of the Code, to secure and maintain the tax exemption of the Trust
under Section 501 of the Code, and in order that the contributions to the Plan
be deductible under Section 404(a) of the Code or under any other applicable
provisions of the Code, as now in effect or hereafter amended, and the
regulations issued thereunder.
Section 16.2 Non-diversion of Assets. No part of the assets of the
Plan and Trust, by reason of any amendment or otherwise, shall be used for, or
diverted to, purposes other than for the exclusive benefit of Participants or
their beneficiaries under the Plan and for the payment of administrative
expenses under the Plan, or as will cause to permit the assets of the Trust to
revert to or become the property of any Employer at any time, except as
provided in Section 4.7 of the Plan. Notwithstanding the foregoing, the
restrictions of this Section will not be violated by either (a) the creation of
a right to payments from this Plan by reason of a Qualified Domestic Relations
Order or (b) the making of such payments.
Section 16.3 Notice of Amendment. Notice of any amendment of the Plan
shall be deemed adequately given if the Employer or the Committee mails written
notice of the same, postage prepaid, to the latest address on file of each
Participant who is affected by such amendment or by any other method deemed
adequate under ERISA or ERISA regulations.
Section 16.4 Participation by Related Corporations. Any corporation
which elects to participate in or withdraw from the Plan shall make such
election by action of its board of directors, subject to the approval of the
Board of Directors of United Parcel Service of America, Inc. No amendment of
the Plan and no further action by any other corporation accepting or ratifying
such election will be required.
Section 16.5 Merger or Consolidation of Plan; Transfer of Plan Assets.
In the case of any merger or consolidation with, or transfer of assets and
liabilities to, any other plan, provisions shall be made so that each
Participant in the Plan on the date thereof, if the Plan then terminated, would
receive a benefit immediately after the merger, consolidation or transfer which
is equal to or greater than the benefit he would have been entitled to receive
immediately prior to the merger, consolidation or transfer if the Plan had then
terminated.
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ARTICLE XVII
TERMINATION
Section 17.1 Application of Assets Upon Termination. In the event the
Plan is terminated or partially terminated, the Committee shall direct the
Trustee to distribute all assets remaining in the Trust, after payment of any
expenses properly chargeable against the Trust, to the Participants, or their
beneficiaries or estates in accordance with the value of the accounts of such
persons as adjusted to the date of such termination of the Plan, in such form
as the Committee shall determine, in its sole discretion. If the Plan is
terminated, the Committee in office at the time of such termination shall
continue to act with its full powers hereunder until the completion of the
distribution of such assets; and a majority of the members of the Committee
then in office shall have the power to fill any vacancies occurring in the
Committee after such termination by resignation, death or otherwise. In the
event the Committee within a reasonable time after such termination shall not
have given the Trustee the directions provided for in this section, the Board
of Directors shall succeed to all powers and duties of the Committee and shall
direct the Trustee to distribute the assets of the Trust to the Participants,
or their beneficiaries or estates as herein provided.
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ARTICLE XVIII
MISCELLANEOUS
Section 18.1 Governing Law. The provisions of the Plan shall be
construed, regulated and administered according to the laws of the State of
Connecticut, except to the extent preempted by Federal Law.
Section 18.2 Facility of Payment. If any Participant of beneficiary
is, in the judgment of the Committee, legally, physically or mentally incapable
of personally receiving any payment due hereunder, payment may be made to the
guardian or other legal representative of such Participant or beneficiary or to
such other person or institution who or which, in the opinion of the Committee,
is then maintaining or has custody of such Participant or beneficiary. Such
payments shall constitute a full discharge with respect to the Participant's
right to payments under this Plan.
Section 18.3 No Access to Records. Nothing herein or in the Trust
Agreement shall give any Participant, beneficiary or any other person the right
or privilege to examine or have access to the books or records of any
corporation described in Section 1.1(d) or of the Committee or the Trustee; nor
shall any such person have any right, legal or equitable, against any
corporation described in Section 1.1(d) or against any director, officer,
employee, agent or representative thereof or against the Trustee or the
Committee, except as herein expressly provided and as permitted by applicable
law.
Section 18.4 Annual Accounting. The Committee shall mail to each
Participant and beneficiary, as soon as practicable after the end of each
calendar year, a written statement of his account as of the close of such
calendar year.
Section 18.5 Obligation of Employers to Pay Amounts Withheld.
Notwithstanding anything herein provided, each Employer shall be liable for all
amounts it has deducted from the salaries or wages of Participants employed by
it and shall continue to be liable for the same until the same are paid over to
the Trustee.
Section 18.6 Annual Examination of Books and Records.
(a) As soon as practicable after the close of each calendar
year, the Committee shall cause the books and records, insofar as they relate
to the Plan, of the Committee, each Employer and the Trustee to be examined by
independent certified public accountants. Such accountants shall prepare a
report of their examination which shall include the following:
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(1) A statement of the assets and liabilities of the
Trust at the close of such calendar year;
(2) A statement of the income and expenses of the
Trust for such calendar year; and
(3) A certification showing, with respect to such
calendar year, the amount payable under the Plan by each Employer and the
amount paid under the Plan by each Employer to the Trustee. The reports of such
certified public accountants shall be retained by the Committee and made
available for inspection by any Participant, or beneficiary.
(b) The independent certified public accountants preparing
the report provided for above may, for purposes of the certification provided
for in subsection (a)(iii) above, rely on examinations made by other
independent certified public accountants, but in such case the report shall
state that such examinations were made by such other accountants.
Section 18.7 Gifts to Trust.
(a) The Trustee, with the direction and consent of the
Committee, may accept and receive money or property by way of gift from any
individual who is or has been an employee of any corporation described in
Section 1.1(d) or of any predecessor corporation, partnership or other
organization or from the spouse or surviving spouse of such individual or under
the will of or from a trust created by such individual or such spouse or
surviving spouse.
(b) Any money or property accepted and received by the
Trustee under subsection (a) above may be retained in the form received or, in
the discretion of the Committee, may be converted into any investment described
in Section 13.2.
(c) The Special Gift Account in the General Fund shall be
credited during each calendar year with any money or property received by the
Trustee under subsection (a) above. At the end of each calendar year the
Committee shall allocate to and credit each Participant's Company Contributions
Account in the General Fund that part of the Special Gift Account as of the
close of such year which bears the same ratio to such account as the average
monthly balance during such year of such Participant's combined Participant
Savings Account, Employer Contributions Account and Participant Investment
Income Account in the General Fund bears to the aggregate average monthly
balances during such year of such combined accounts of all Participants in the
General Fund.
(d) The credits to Participants accounts provided for in
subsection (c) above shall not be taken into account in determining average
monthly balances of Participants until the end of the first month following the
calendar year from which such credits are derived.
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Section 18.8 Titles. Titles of Articles and Sections are inserted for
convenience only and shall not affect the meaning or construction of the Plan.
Section 18.9 Counterparts. This Plan may be executed by the Employer
in various counterparts to this document, each of which shall be deemed to be
an original but all of which shall be deemed to be one document.
Section 18.10 Prohibition Against Attachment.
(a) None of the benefits payable hereunder shall be subject
to the claims of any creditor of any Participant or beneficiary other than this
Plan nor shall the same be subject to attachment, garnishment or other legal or
equitable process by any creditor of the Participant or beneficiary other than
this Plan, nor shall any Participant or beneficiary have any right to alienate,
anticipate, commute, pledge, encumber, or assign any of such benefits.
(b) If any Participant or beneficiary under the Plan becomes
bankrupt or attempts to anticipate, alienate, sell, transfer, assign, pledge,
encumber or charge any benefit under the Plan, the interest of such person in
such benefit shall, in the discretion of the Committee, cease and terminate,
and in that event the Committee may direct the Trustee to hold or apply the
same or any part thereof to or for the benefit of such Participant or
beneficiary, his spouse, children, or other dependents, or any of them, in such
manner and in such proportion as the Committee may deem proper.
(c) the restrictions of subsections (a) and (b) of this
Section will not be violated by either (1) the creation of a right to payments
from this Plan by reason of a Qualified Domestic Relations Order or (2) the
making of such payments.
Section 18.11 Payment to Minor Beneficiary. If the beneficiary of any
Participant shall be a minor and no guardian shall have been appointed for him,
the Committee may direct the Trustee to retain any payment due under the Plan
for his benefit until he attains majority. Such amount, as authorized by the
Committee may be held in cash, deposited in bank accounts, or invested and
reinvested in direct obligations of the United States, and the income thereon
may be accumulated and invested, or the income and principal may be expended
and applied directly for the maintenance, education and support of such minor
without the intervention of any guardian and without application to any court.
Section 18.12 Plan Provisions in Effect. The benefit to which a
Participant under this Plan is entitled shall be determined by the provisions
of the Plan which were in effect on the date of the Participant's retirement,
death, or other termination of service, whichever is the earliest. No amendment
made to the Plan after such date shall effect the entitlement of a Participant
to any benefit hereunder.
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Section 18.13 Withholding of Income Tax.
(a) Notification of Withholding of Federal Income Tax. All
Participants and beneficiaries entitled to receive benefits under the Plan
shall be notified of the Plan's obligation to withhold federal income tax from
any benefits payable pursuant to the terms of the Plan. Such notice shall be in
writing, be given at the times set forth in subsection (b) and contain the
information set forth in subsection (c) of this Section.
(b) Time of Notice. The notice described in subsection (a)
shall be provided not earlier than six months before such payment is to be made
and not later than the time the Participant or beneficiary is furnished with
his or her claim for benefits application.
(c) Content of the Notice. The notice required by subsection
(a) shall, at a minimum:
(1) with respect to any distribution which is an
eligible rollover distribution within the meaning of Code Section 3405(c)(3)
(other than an eligible rollover distribution of less that $200 which is exempt
from withholding under regulations prescribed by the Secretary of the
Treasury), advise the payee that there shall be withheld from such distribution
an amount equal to 20 percent thereof (or such other amount as may from time to
time be prescribed by the Code, or the Secretary of the Treasury or his
delegate), unless the payee directs the Committee to transfer such distribution
as a direct rollover to an eligible retirement plan, within the meaning of
Section 10.5(a) hereof, in accordance with such procedures as the Committee may
prescribe (a "transfer direction"),
(2) with respect to any distribution which is not an
eligible rollover distribution within the meaning of code Section 3405(c)(3):
(A) advise the payee of his or her right to
elect not to have withholding apply to any payment or distribution and explain
the manner in which such election may be made, and include or indicate the
source of any forms necessary to make the election;
(B) advise the payee that penalties may be
incurred under the estimated tax payment rules if the payee's payments of
estimated tax are not adequate and sufficient tax is not withheld from payments
under this Plan; and
(C) advise the payee that the election not
to have federal income tax withheld from benefits is prospective only and that
any election made after a payment or distribution to the payee is not an
election with respect to such payment or distribution.
(d) Effective Date of Elections. Any transfer direction,
election or revocation of any election by a payee shall become effective
immediately upon receipt by the Committee of
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the transfer direction, election or revocation. Thereafter, the Committee
shall, unless otherwise provided by applicable law, regulation or other
guidance by the Secretary of the Treasury or his delegate, withhold federal
income tax in accordance or consistent with the instructions filed by the
payee.
(e) Failure to Make Election.
(1) In the case of an eligible rollover
distribution, if the payee fails to provide the Committee with a transfer
direction, the Committee shall withhold an amount equal to 20% of the amount of
the distribution (or such other amount as may be from time to time prescribed
by the Code, or the Secretary of the Treasurer or his delegate).
(2) In the case of a distribution which is not an
eligible rollover distribution, if the payee fails to provide the Committee
with a withholding certificate, the Committee shall withhold an amount equal to
10% of the amount of the distribution.
(f) Coordination with Internal Revenue Code and Regulations.
Notwithstanding the foregoing, the Committee shall discharge its withholding
and notice obligations in accordance with the Code and regulations and such
other guidance with respect thereto as may be promulgated from time to time by
the Secretary of the Treasury or his delegate.
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ARTICLE XIX
TOP-HEAVY PROVISIONS
Section 19.1 Effective Date of This Article. This Article shall be
effective for all Plan Years beginning after December 31, 1983.
Section 19.2 Definitions. The following definitions apply to this
Article:
(a) "Top-Heavy Plan" -- The Plan is a Top-Heavy Plan in any
Plan Year in which:
(1) the Plan is a member of a Top-Heavy Group, if
the Plan is described in Section 19.2(c)(1) or (2), below; or
(2) the Plan is not a member of an Aggregation Group
as described in Section 19.2(c)(1) or (2), below, and, as of the Determination
Date, the Account Aggregate of the Plan for Key Employees exceeds sixty percent
of the Account Aggregate of the Plan for all Participants.
(b) "Key Employee" means an Employee (or former Employee) who
at any time during the Plan Year or any of the four preceding Plan Years is:
(1) an officer of the Employer having an annual
compensation from the Employer of more than $45,000 (provided, however, that no
more than the lesser of (A) 50 Employees or (B) the greater of three Employees
or ten percent of the Employees shall be treated as officers under this
paragraph).
(2) one of the ten Employees having an annual
compensation from the Employer of more than $30,000 and owning the largest
interests in the Employer -- provided, however, that no Employee shall be
counted under this Paragraph unless his interest in the Employer exceeds 0.5%
of the value of all ownership interests in the Employer.
(3) an owner of five percent of the outstanding
stock of the Employer or stock possessing more than five percent of the total
combined voting power of all stock of the Employer, or
(4) an owner of one percent of the outstanding stock
of the Employer or stock possessing more than one percent of the total combined
voting power of all stock of the Employer, who has an annual compensation from
the Employer of more than $150,000.
For purposes of paragraph (2) hereof, if two Employees have
the same interest in the Employer, the Employee with the greater annual
compensation shall be treated as having a larger
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interest. For purposes of determining ownership in the Employer (i) the
constructive ownership rules of Section 318 of the Code, as modified by
substituting "five percent" for "fifty percent" in subsection (a)(2)(C)
thereof, shall apply, but (ii) the rules of subsections (b), (c) and (m) of
Section 414 of the Code shall not apply. Each Beneficiary of a Key Employee
designated under this Plan is a Key Employee.
(c) "Aggregation Group" means a group of plans consisting of
more than one plan and including:
(1) each plan of the Employer in which a Key
Employee is a Participant;
(2) each other plan of the Employer which enables
any plan described in (1) to meet the requirements of Section 401(a)(4) or
Section 410 of the Code; and
(3) any plan not described in (1) or (2) which the
Employer elects to include, provided that such inclusion does not prevent the
group from meeting the requirements of Section 401(a)(4) and Section 410 of the
Code.
(d) "Top-Heavy Group" is an Aggregation Group for which, as
of the Determination Date, the Total Benefit for Key Employees exceeds sixty
percent of the Total Benefit for all Participants.
(e) "Determination Date" is the last day of the preceding
Plan Year.
(f) "Account Aggregate" is, with respect to a defined
contribution plan, the sum of employee accounts plus the sum of all
distributions made from such accounts during the five-year period ending on the
Determination Date, provided that (1) rollover contributions and similar
transfers initiated by an Employee and made after 1983, (2) the account of any
Employee who was a Key Employee in a prior Plan year but is no longer a Key
Employee, (3) any accrued benefits attributable to deductible employee
contributions, and (4) effective for Plan Years beginning after December 31,
1984, the account of any individual who has not received any compensation from
the Employer (other than benefits under any plan maintained by the Employer)
during the five-year period ending on the Determination Date, shall not be
taken into account. A transfer from one plan of the Employer to any other such
plan shall be considered neither a "distribution" nor a "rollover contribution"
for purposes of this subsection, but a distribution from a terminated plan
shall be considered a "distribution" for purposes of this subsection if such
terminated plan, had it not been terminated, would have been described in
Section 19.2(c)(1) or (2).
(g) "Cumulative Accrued Benefit" is, with respect to a
defined benefit plan, the sum of the present values of all accrued benefits
plan, the sum of distributions made with respect to such benefits during the
five-year period ending on the Determination Date, provided that (1) rollover
contribu
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tions and similar transfers initiated by an Employee and made after 1983, (2)
the accrued benefit of any Employee who was a Key Employee in a prior Plan Year
but is no longer a key Employee, (3) any accrued benefits attributable to
deductible employee contributions, and (4) effective for Plan years beginning
after December 31, 1984, the accrued benefit of any individual who has not
received any compensation from the Employer (other than benefits under any plan
maintained by the Employer) during the five-year period ending on the
Determination Date, shall not be taken into account. A transfer from one plan of
the Employer to any other such plan shall be considered neither a "distribution"
nor a "rollover contribution" for purposes of this subsection, but a
distribution from a terminated plan shall be considered a "distribution" for
purposes of this subsection if such terminated plan, had it not been terminated,
would have been described in Section 19.2(c)(1) or (2).
(h) "Total Benefit" is the sum of the Account Aggregate of
all plans within an Aggregation Group which are defined contribution plans, and
the Cumulative Accrued Benefit of all plans within an Aggregation Group which
are defined benefit plans.
(i) "Total Compensation" is the Participant's compensation as
defined in Section 415(c)(3) of the Code, but shall not be greater than the
applicable annual dollar limitation prescribed in Code Section 401(a)(17).
(j) "Minimum Percentage" is the greater of:
(1) the percentage of the Participant's Total
Compensation which would be allocated to the Participant's account for the Plan
Year if Section 19.4 were disregarded, or
(2) the lesser of (A) three percent or (B) the
highest percentage at which contributions are made or required to be made for
any Key Employee, which percentage shall be determined by dividing the
contributions made or required to be made for such Key Employee by his or her
Total Compensation; provided that for purposes of computing such percentage all
defined contribution plans included in an Aggregation Group will be treated as
one plan, but provided further that if the Plan is included in such Aggregation
Group in order to allow a defined benefit plan within the group to meet the
requirements of Section 401(a)(4) or Section 410 of the Code, then such
percentage shall be deemed to be three percent.
For purposes of this subsection (j) and effective only for
the Plan year which ends on December 31, 1984, any employee contribution
attributable to a salary reduction or similar arrangement shall not be taken in
account.
(k) "Employer" means, for purposes of this Article, the
Employer and all Related Employers.
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Section 19.3 Top-Heavy Vesting Schedule. For each Plan Year
for which the Plan is a Top-Heavy Plan, the vesting schedule provided in this
Section 19.3 (the "Top-Heavy Vesting Schedule") shall apply if such schedule
provides a greater nonforfeitable percentage than the vesting schedule provided
in Section 8.1 (the "Regular Vesting Schedule"), and for each Plan Year
thereafter for which the Plan is not a Top-Heavy Plan, the Regular Vesting
Schedule provided in Section 8.1 shall apply; provided, however, that any
change in a vesting schedule shall, with respect to each Participant, be
subject to Section 8.1. The Top-Heavy Vesting Schedule is as follows:
NONFORFEITABLE
YEARS OF SERVICE PERCENTAGE
Less than 2 0
2 but less than 3 20
3 but less than 4 40
4 but less than 5 60
5 but less than 6 80
6 or more 100
Section 19.4 Top-Heavy Minimum Benefit. For each Plan Year
for which the Plan is a Top-Heavy Plan, the Employer shall contribute to the
account of each Participant who is not a Key Employee an amount which, when
added to any forfeitures allocated to such Participant's account, is not less
than the Minimum Percentage of the Participant's Total Compensation for the
year.
Solely for the purpose of determining if the Plan, or any
other plan included in a required aggregation group of which this Plan is a
part, is Top-Heavy, the accrued benefit of an Employee other than a Key
Employee shall be determined under (a) the method, if any, that uniformly
applies for accrual purposes under all plans maintained by the Employer, or (b)
if there is no such method, as if such benefit accrued not more rapidly than
the slowest accrual rate permitted under the fractional accrual rate of Section
411(b)(1)(C) of the Code.
Section 19.5 Reserved.
Section 19.6 Reserved.
Section 19.7 Top-Heavy Adjustment to Section 415 Limitations. For each
Plan Year for which the Plan is a Top-Heavy Plan, the limit imposed by Section
6.2(c) shall be applied by substituting "1.0" for "1.25" in each place where it
appears, unless the Employer elects to make, and does make, additional
contributions sufficient to meet the requirements specified in subsection (b)
hereof. Such election shall only be effective for those Plan Years in which:
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(a) the Plan would not be a Top-Heavy Plan as defined in
Section 19.2(a), above, if "ninety percent" were substituted for "sixty
percent" in Section 19.2(a)(2) and Section 19.2(d), and
(b) with respect to each plan described in Section 19.2(c)(1)
or (2): (1)the minimum benefit described in Section 416(c)(2) of the Code (as
modified by Section 416(h)(2) (A)(ii)(II)) is provided by each such plan which
is a defined contribution plan, and (2) the minimum benefit described in
Section 416(c)(1) of the Code (as modified by Section 416(h)(2)(A)(ii)(I)) is
provided by each such plan which is a defined benefit plan.
Section 19.8 Certain Benefits Disregarded. The requirements of Section
19.3 and Section 19.4, above, must be met without taking into account
contributions or benefits under Chapters 2 or 21 of the Code, Title II of the
Social Security Act, or any other federal or state law.
IN WITNESS WHEREOF, the Employer, as evidence of adoption of the
foregoing as a restatement of the Plan incorporating all amendments made to
date, has caused the same to be executed by its duly authorized officers and
its corporate seal to be affixed this ____ day of ____________________, 2001.
ATTEST UNITED PARCEL SERVICE OF AMERICA, INC.
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Secretary Chairman
[SEAL]
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