10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION   

Washington, D.C. 20549

FORM 10-K

(Mark one)

[X]     ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF

        THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2002

                       OR

[ ]      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to _____________

Commission File No.: 1-8467   

BMC INDUSTRIES, INC.

(Exact name of registrant as specified in its charter)

Minnesota	41-0169210
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
One Meridian Crossings, Suite 850, Minneapolis, MN	55423
(Address of principal executive offices)	(Zip Code)

Registrant's telephone number, including area code:  (952) 851-6000

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
Common Stock	New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:

None

(Title of class)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes  X   No __ 

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10‑K. [  ]

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act). Yes __ No  X

The aggregate market value of the registrant's common stock (its only voting stock) held by non-affiliates of the registrant, based on the closing sale price for the registrant's common stock as reported on the New York Stock Exchange on June 28, 2002, the registrant's most recently completed second quarter, was approximately $24.8 million.  As of March 21, 2003, there were 27,079,385 shares of common stock of the registrant outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Part III of this report on Form 10-K incorporates by reference information, to the extent specific sections are referred to herein, from the registrant's proxy statement for its annual meeting of stockholders to be held on May 13, 2003, which proxy statement will be filed no later than 120 days after the close of the registrant's fiscal year ended December 31, 2002.

TABLE OF CONTENTS

PART I.
Item 1.	Business	1
Item 2.	Properties	11
Item 3.	Legal Proceedings	12
Item 4.	Submission of Matters to a Vote of Security Holders	12
PART II.
Item 5.	Market for Registrant's Common Equity and Related Stockholder Matters	12
Item 6.	Selected Financial Data	13
Item 7.	Management's Discussion and Analysis of Financial Condition and Results of Operations	14
Item 7A.	Quantitative and Qualitative Disclosures About Market Risk	23
Item 8.	Financial Statements and Supplementary Data	24
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	46
PART III.
Item 10.	Directors and Executive Officers of the Registrant	46
Item 11.	Executive Compensation	47
Item 12.	Security Ownership of Certain Beneficial Owners and Management	47
Item 13.	Certain Relationships and Related Transactions.	47
Item 14.	Controls and Procedures	47
PART IV.
Item 15.	Exhibits, Financial Statement Schedules and Reports on Form 8-K	48
	Signatures	51
	Certifications	52

Cautionary Statement

      This Annual Report on Form 10-K contains and incorporates by reference statements relating to future results of BMC Industries, Inc. that are considered "forward-looking" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and are subject to the Safe Harbor provisions created by the statutes. These statements relate to our current views with respect to non-historical information and include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements. They include words such as "anticipate," "estimate," "project," "forecast," "may," "will," "should," "expect" and words of similar meaning. These statements are not guarantees of future performance and are subject to certain known and unknown risks, uncertainties and contingencies, many of which are beyond our control, that may cause, and in certain instances have caused, actual results, performance or achievements to differ materially from those expressed or forecasted. Certain of these risks and uncertainties are discussed in this Form 10-K in the section entitled "Factors That May Affect Future Results."  These risks should not be considered an exhaustive list. You should not rely on any forward-looking statements, which reflect only our belief as of the date of this Form 10-K. We do not undertake the responsibility to update any forward-looking statement to reflect events or circumstances after the date of this report. 

PART I

Item 1. Business

AVAILABILITY OF SEC REPORTS

BMC Industries, Inc. maintains an Internet website at www.bmcind.com.    BMC makes available free of charge through its website its annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports, filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after such reports are electronically filed with, or furnished to, the SEC.  These reports may be accessed through the website's investor information page.

(a)     General Development of Business.

BMC Industries, Inc. ("BMC," the "Company," "we," "our" or "us") was established in 1907 as a Minnesota corporation and has developed into a multinational manufacturer and distributor of high volume precision products in two reportable segments: Buckbee-Mears and Optical Products. The Buckbee-Mears group is comprised of Mask Operations and Non-Mask Operations.  Mask Operations produces aperture masks, which are a key component of color television picture tubes.  Non-Mask Operations, formerly "Micro-Technology Operations," is a leading producer of photochemically machined precision parts for medical products, electronics, filtration and automotive applications. Buckbee-Mears operates in a highly price competitive industry, particularly the market for aperture masks, which has impacted the business for several years.  As a result, the group is focused on cost reductions while investing strategically into new product development. During 2002, the Buckbee-Mears group shutdown its Non-Mask Operations facility located in St. Paul, Minnesota and sold a portion of the non-mask sheet etching business. The remaining operations were consolidated into the Mask Operations facilities in Cortland, New York and Mullheim, Germany. Mask Operations also responded during 2002 to dramatically falling prices for computer monitor masks by converting all mask production lines to television aperture masks and exiting the monitor mask market, except for occasional production on a tactical basis.

Optical Products, through Vision-Ease Lens, Inc. and other operating subsidiaries, designs, manufactures and distributes polycarbonate, glass and hard-resin plastic eyeglass lenses for the global optical industry.  Vision-Ease is one of the top global manufacturers of polycarbonate and glass lenses. Polycarbonate is the fastest growing lens material in the optical industry and the Optical Products group is a leader in the design and development of premium polycarbonate products, including progressive, photochromic and polarizing lenses. Similar to the actions taken by Buckbee-Mears, the Optical Products group reduced operating costs in 2002 by closing its Azusa, California production facility and consolidated production into its two remaining manufacturing facilities in Jakarta, Indonesia and Ramsey, Minnesota. 

(b)    Financial Information About Industry Segments.

Financial information about our operating segments for the three most recent fiscal years appear on pages 41-42.

(c)    Narrative Description of Business.

Buckbee-Mears

Products and Marketing. The Buckbee-Mears facilities in Cortland and Mullheim both are ISO 9002 certified, which is a critical prerequisite to supplying products to a broad base of customers. Mask Operations manufactures aperture masks at the Cortland and Mullheim facilities and operates a low-cost mask inspection facility in Tatabanya, Hungary. Non-Mask Operations conducts research, development and specialty manufacturing of precision photo-etched metal parts, in both Cortland and Mullheim.

Two customers of Buckbee-Mears each accounted for more than 10% of our total Company revenues for 2002. Thomson, S.A. of France, including its U.S. based operations, accounted for approximately 19% of our 2002 total Company revenues. Samsung Display Co., Ltd., of South Korea accounted for approximately 13% of our 2002 total Company revenues. Thomson produces televisions in North America and Europe under various trademarks, including RCA and GE.  Samsung produces televisions in the Americas, Europe and Asia and computer monitors in South America and Asia under the Samsung trade name.

Aperture masks are photo-chemically etched fine screen grids found in color television and computer monitor picture tubes and consist of thousands of precise, conically shaped holes designed to focus the electron beam on the proper phosphor color stripe to produce a crisp image.  Aperture masks are made from steel or invar, a nickel and iron alloy, and range in size from 6-inch to 40-inch diagonal dimensions. Buckbee-Mears manufactures aperture masks ranging from 14-inch to 36-inch diagonal dimensions. Our facilities employ an automated, continuous photochemical etching process that we originally developed in the 1950s and licensed to others in subsequent years. We sell aperture masks directly to color television tube manufacturers in North America, Europe and Asia through an in-house sales organization. Sales of aperture masks comprised 52%, 52% and 55% of our consolidated total revenues in 2002, 2001 and 2000, respectively.

Mask Operations is engaged in ongoing efforts to develop future manufacturing and technical expertise in higher margin, television masks for high definition television ("HDTV"), flat, wide screen (16 x 9) and digital applications. We have made significant process capability gains on these advanced mask products, particularly in the flat, widescreen and HDTV categories. The Buckbee-Mears group also achieved substantial growth in sales of aperture masks to new customers in China and other parts of Asia. At the same time, sales of masks were down in North America and Europe. Buckbee-Mears was able to increase its share of mask sales in Asia by redirecting sales efforts to Asia last year when demand for television masks began declining in NAFTA.  Buckbee-Mears is increasing its efforts to grow sales outside North America and Europe in order to offset lower demand in our home markets. The North American and European markets are experiencing declining mask demand due to imports of television sets from China and plant shutdowns by tube and set manufacturers in the US and Europe.   

Non-Mask Operations markets its development capabilities and sells products through in-house sales representatives, independent manufacturer representatives and distributors to customers in the medical, electronics, automotive and filtration applications, including ignition components, medical device components and reusable filtration devices. Over the past few years, Non-Mask Operations has pursued a strategy of leveraging its high-volume precision technologies and production capabilities to attract large end-product manufacturers for joint research and product development projects. These efforts have resulted in the development of new technology and new customers who offer the potential for significant future revenues. In March 2001, Buckbee-Mears signed an agreement with Cordis Corporation, a wholly-owned unit of Johnson & Johnson, for the development and supply of stents. Following two years of development efforts, Buckbee-Mears is working with Cordis to obtain approval of our manufacturing operations in Cortland from the Food and Drug Administration ("FDA"). The group is seeking to expand its development and production of medical products beyond stents by obtaining FDA certification at the Cortland facility. 

Raw Materials. Buckbee-Mears procures raw materials from multiple suppliers. Steel and invar are the main raw materials used by Buckbee-Mears. Our Cortland facility imports all of its steel and invar from suppliers in Japan and Germany. Our Mullheim facility obtains a majority of its steel and invar raw material from a supplier within Germany and the remaining portion from a vendor in Japan. Importation of steel into the United States is subject to certain restrictions imposed by U.S. trade legislation and regulations. In addition, steel imports are the subject of occasional domestic trade disputes and investigations that have resulted in the imposition of tariffs by the U.S. government. We have successfully obtained exclusions from these tariffs to date, most recently as March 2002, based on our inability to source aperture mask steel in the U.S. We do not anticipate difficulty in obtaining steel or any other raw materials. As we increase sales in Asia, however, we are required to use different types of steel than we currently use in our home markets. We do not anticipate that this will cause any production problems or that the steel will not be available but there can be no assurance that shortages or other problems will not occur given the recency of our sales efforts into Asia.  Our inability to obtain these materials would have a material adverse effect on production and results of operations.

Intellectual Property.  We have a number of patents and license rights that are important to the success of our Buckbee-Mears operations. These patents range in their expiration dates from 2003 to 2022. We believe that the loss of any single patent would not have a material adverse effect on our business as a whole. We believe that improvement of existing products and processes and a reliance on trade secrets and unpatented proprietary know-how are as important as patent protection in establishing and maintaining our competitive position.  At the same time, we continue to seek patent protection for our products and processes on a selective basis.  There can be no assurance, however, that any issued patents will provide substantial protection or commercial value.  We require our consultants and employees to agree in writing to maintain the confidentiality of our information and, within certain limits, to assign to us any inventions, and any patent or other intellectual property rights, relating to our business. Technical employees also are required to sign non-compete agreements, which BMC rigorously enforces. In addition, we have an Intellectual Property program that enhances our ability to identify and protect intellectual property from the development stage through the life of our products and processes. Employees from operations, research and development and legal meet on a regular basis to review existing Intellectual Property and strategies for protecting and practicing these assets.

Seasonality.  Buckbee-Mears' revenues and earnings are generally lower in the first and third quarters due to maintenance shutdowns at the Cortland and Mullheim facilities. The seasonality of end products in the television market also affects our annual earnings pattern.

Competition.  The precision etched metal and electroformed parts business is intensely competitive, with no one competitor dominating the market. We are one of five independent mask manufacturers in the world and the only independent mask manufacturer with production facilities in the United States.  Our primary mask competitors operate in Japan, China and Korea. Independent mask manufacturers supply approximately 86%of the global mask market, with BMC among the largest at an estimated 19% of the television mask market share. We supplied approximately 16% of the worldwide demand for television masks in 2002.

In addition to competition from other mask manufacturers, Mask Operations competes against rival technologies such as LCD and plasma televisions and projection televisions. Sales of LCD and projection televisions in the U.S. have grown over the last year due to rapidly dropping prices, contributing in the decline in sales of jumbo CRT televisions. Further, many consumers identify HDTV with projection televisions, further contributing to the growth in sales of projection televisions. Nevertheless, rival product technologies such as plasma and LCD are still very expensive compared to CRT technology and therefore we believe they are not a practical substitute to CRT technology for much of the global consumer television market for at least the next 3 to 5 years.

Many producers compete in the market for specialty precision photo-etched and electroformed metal parts that are produced by Non-Mask Operations, including some that also manufacture aperture masks. There is no clear market share leader in this fragmented industry. We compete principally on the basis of price, product quality, product availability and customer service. We also attempt to build preferred supplier and research and development arrangements with customers to best meet their current and new product requirements.  In order to find new products and technology while remaining competitive on existing products, we engage in ongoing cost reduction measures, including the development of automated processes. 

Backlog.  As of December 31, 2002, the firm backlog of Buckbee-Mears sales orders was $7.7 million, compared with $14.9 million as of December 31, 2001.  We expect that all of the December 31, 2002 backlog orders will be filled within the current fiscal year.

Employees . As of March 21, 2003, Buckbee-Mears had approximately 819 employees in the United States and Europe. The majority of U.S. employees are not represented by labor unions. In compliance with local laws, production employees in Europe are represented by labor unions. Labor relations generally are considered to be good and there have been no significant labor disputes in the past ten years.

Optical Products

Products and Marketing.  Optical Products, operating under the Vision-Ease Lens trade name, designs, manufactures and distributes a full line of optical lenses. The Optical Products group shares its headquarters with the corporate office of BMC in Richfield, Minnesota. Vision-Ease has a polycarbonate processing laboratory in France, two distribution centers in the U.S. and distribution centers in Canada and England. Optical Products consolidated its manufacturing operations in early 2002 through the closure of its production and distribution facility in Azusa, California and the transfer of those operations to our two remaining production facilities in Ramsey and Jakarta.

Vision-Ease manufactures lenses in two principal materials, polycarbonate and glass, and sources high-index and hard-resin plastic lenses from third party suppliers. The group purchases most of its hard-resin and high-index plastic lenses from a single source. Within each of these lens materials, we offer single-vision lenses, which have a constant corrective power at all points; multi-focal lenses, which have two or more distinct areas of different corrective power; progressive lenses, which are a type of multi-focal lens with a continuous gradient of different corrective power without the line or "jump" generally associated with other multi-focal lenses; and prescription lenses that are used primarily for sunwear. We also produce lenses with features such as anti-reflective and varying levels of scratch-resistant coatings to meet increasing demand for products from customers.

We sell predominantly semi-finished lenses to wholesale optical laboratories or retail outlets with on-site laboratories across the U.S. and Europe. The labs then finish the lens by grinding and polishing the inside surface of the lens according to the prescription provided by the optometrist or ophthalmologist. After processing, the lens is edged and inserted into a frame by either the wholesale laboratory or a retail optical dispenser. We also sell finished single-vision lenses to wholesale laboratories and retail outlets. These finished lenses are ready to be edged and inserted into frames without laboratory surfacing. We also sell semi-finished and finished lenses to a number of OEM customers. We sell prescription polarizing lenses to manufacturers of sunglasses as well as our wholesale and retail customer base.  Vision-Ease generally sells its products to wholesale laboratories through independent sales representatives and to retail outlets through an in-house sales staff.

The Optical Products group established a lens laboratory in France to pursue growth of polycarbonate in the European market. This operation consists of administration/customer service in Noiseau, France and a processing facility in Brou, France. The Brou laboratory specializes in grinding, and applying hard-coatings as well as anti-reflective coatings to polycarbonate lenses for sale in the European market.  Over the course of 2000 to 2002, we qualified our polycarbonate products and laboratory processing capabilities with retailers and OEM partners in Europe.  

We produce semi-finished glass, multi-focal and finished and semi-finished single-vision glass lenses at our Jakarta facility. In 2001, we transferred the production of specialty glass lens products from our former St. Cloud, Minnesota production facility to the Jakarta facility. We complete our product offerings through low cost OEM sourcing arrangements for hard-resin and high-index plastic lenses, most of which are produced under a contract with a single manufacturer in Southeast Asia. These sourcing arrangements allow Vision-Ease to focus manufacturing capabilities on higher-margin products while offering a complete line of lens products at cost competitive prices.

Intellectual Property.   Vision-Ease holds a growing portfolio of patents protecting certain products and manufacturing processes.  These patents have expiration dates ranging from 2003 to 2022. Vision-Ease has built a strong patent position in certain product categories, including polycarbonate polarizing and photochromic lenses, dyes and production processes. We believe the loss of any single patent would not have a material adverse effect on our business as a whole. We believe that improvement of existing products and processes, the development of new lens products and a reliance on trade secrets and unpatented proprietary know-how are as important as patent protection in establishing and maintaining our competitive position. At the same time, we continue to seek patent protection for our products and processes on a selective basis. There can be no assurance, however, that any issued patents will provide substantial protection or commercial value. We require our consultants and employees to agree in writing to maintain the confidentiality of our information and, within certain limits, to assign to us any inventions, and any patent or other intellectual property rights, relating to our business. We also require technical employees to sign non-compete agreements, which we rigorously enforce. The Optical Products group owns several trademarks, including SunRx®, Tegra®, Diamonex®, Vivid™, Outlook™, Continua® and SunSport®. As part of our marketing strategy to build sales of branded products, Vision-Ease has increased the use of trademarks during the past few years. Although there are no assurances as to the strength or scope of our trademarks, we believe that these trademarks have been and will be useful in developing and protecting market recognition for our products. In addition, we have an Intellectual Property program that enhances our ability to identify and protect intellectual property from the development stage through the life of our products and processes. Employees from operations, research and development and legal meet on a regular basis to review existing Intellectual Property and strategies for protecting and practicing these assets.

The Optical Products group has dedicated the significant portion of its research and development time and resources during the past several years to premium, higher-margin polycarbonate lens products. With the guidance of patent counsel, we developed significant proprietary technology and know-how, which we sought to protect through patent claims when appropriate. During 2002, the Optical Products group received several returns on these investments.  In addition to our ability to use the technology for production of lenses, several outside parties signed license agreements with Vision-Ease and agreed to pay a royalty in return for the right to practice certain patent claims issued to Vision-Ease.  Vision-Ease also signed a license agreement with Younger Optics in March 2003, which resulted in a settlement of a lawsuit brought by Vision-Ease against Younger Optics in May 2002. We expect to make continued investments in product and process design and development for all lens materials as well as leverage our core technologies to diversify into new and non-optical products.

Competition.  The ophthalmic lens industry is highly competitive. We compete principally on the basis of product offerings, product quality, customer service and pricing. Vision-Ease is the third largest ophthalmic lens manufacturer and distributor in North America, with a substantially smaller share of the global lens market. Our largest competitors are Essilor International and Sola International Inc., who have a combined share of approximately 60% of the ophthalmic lens sales in North America and 50% of the world-wide lens market. Many of our competitors, particularly Essilor and Sola, have greater financial resources than Vision-Ease with which to fund research and development, marketing and capital expenditures. These competitors also own and operate a substantial number of domestic vertically integrated wholesale laboratories. 

In addition to direct competition with other manufacturers of eyeglass lenses, we compete indirectly with manufacturers of contact lenses and providers of medical procedures for the correction of visual impairment. Contact lenses are not, however, perfect substitutes for lenses because of the difficulty of developing progressive or bifocal contact lenses for presbyopia.  In addition, contact lens wearers also tend to own eyeglasses or sunwear. A number of companies have developed, or are developing, surgical equipment or implants used to correct refractive error, including myopia, hyperopia and astigmatism. These procedures are ineffective at correcting presbyopia, which affects the vast majority of people above the age of 45, and is a major cause of demand for Vision-Ease's progressive and other multi-focal lenses. There can be no assurance, however, that current medical procedures, or ones developed in the future, will not materially impact demand for our lenses.

Raw Materials.  Vision-Ease procures raw materials from multiple suppliers.  There are multiple domestic and foreign sources of high-quality, optical grade polycarbonate resin. We obtain most of our hard-resin plastic lenses from a single source in Southeast Asia. In addition, we source film used in the production of polarizing lenses from a single source in Japan. The importation of raw materials and products into and out of foreign territories is subject to certain trade restrictions imposed by foreign and United States trade regulations that could result in the disruption of supply.  Although we do not anticipate any disruption to our supply of raw materials or lenses produced or sourced outside the U.S., the inability to obtain these supplies could have a material adverse effect on Vision-Ease's results of operations.

Backlog and Inventory.  Due to the importance in the ophthalmic lens industry of rapid turnaround time from order to shipment, the backlog of sales orders is not material. We maintain a significant amount of inventory, however, in order to satisfy the rapid response time and complete product offerings in glass, hard resin plastic and polycarbonate demanded by our customers.

Seasonality.  Earnings are generally lower in the first and fourth quarter due to the seasonality of retail eyewear sales, the end product of our lenses.

Employees.  As of March 21, 2003, Vision-Ease had approximately 1,586 employees in the United States, Europe and Indonesia. None of the employees in the United States are represented by labor unions.  In compliance with local laws, production employees in Europe and Indonesia are represented by labor unions.  Labor relations are considered to be good at all operations and there have been no significant labor disputes in this group's history of operations.

Environmental

As part of our manufacturing processes in both the Buckbee-Mears and Optical Products groups, we use chemical substances that must be handled in accordance with federal, state, local and foreign environmental and safety laws and regulations. These processes also generate wastewater and wastes, some of which are classified as hazardous under applicable environmental laws and regulations. The wastewater is treated using on-site wastewater treatment systems. We employ systems for either disposing of wastes in accordance with applicable laws or regulations or recycling the chemicals we use through the manufacturing process. Environmental and other government agencies monitor the wastes and the wastewater treatment systems to ensure compliance with applicable standards. Although we attempt to operate within all applicable laws and follow sound environmental procedures, environmental regulations place responsibility for waste on the generator even after proper disposal. There can be no assurance, therefore, that we will not incur future liability for waste disposal despite our best efforts. As of March 21, 2003, we were involved in a total of seven (7) environmental investigations and/or remedial actions in which final settlement had not been reached, of which one (1) relates to a discontinued operation, four (4) relate to Buckbee-Mears operations and two (2) relate to Optical Products operations.

To the extent possible with the amount of information available at this time, we have evaluated our responsibility for costs and related liability with respect to these investigations/remedial actions, have recorded accruals for our estimated liability in accordance with generally accepted accounting principles, and are of the opinion that our liability with respect to these matters should not have a material adverse effect on our financial position or the results of our operations. In arriving at this conclusion, we have considered, among other things, historical costs to address these matters; the factors, such as volume and relative toxicity, ordinarily applied to allocated defense and remedial costs; the probable costs to be paid by the other potentially responsible parties; total projected remedial costs, if known; existing technology; and currently applicable laws and regulations. A portion of the costs and related liability for certain matters has been or will be covered by insurance or third parties.

We estimate that Buckbee-Mears incurred approximately $2.9 million in 2002, $5.3 million in 2001 and $5.4 million in 2002 on expenditures, including capital expenditures, related to efforts to comply with applicable laws and regulations regulating the discharge of materials into the environment or otherwise relating to the protection of the environment. We anticipate that Buckbee-Mears will spend approximately $2.5 million in 2003 and $0.6 million in 2004 on capital expenditures for environmental control facilities and response costs.  Vision-Ease incurred approximately $0.1 million in 2002, $0.2 million in 2001 and $0.1 million in 2000 on expenditures, including capital expenditures, related to efforts to comply with applicable laws and regulations regulating the discharge of materials into the environment or otherwise relating to the protection of the environment. We estimate that Vision-Ease will make approximately $0.1 million in capital expenditures for environmental control facilities during each of 2003 and 2004.

(d)     Financial Information About Geographic Areas.

Financial information about our operations in different geographic areas for the three most recent fiscal years appears on page 43.

(e)    Risk Factors

Potential Pension Contribution Obligation.  Our German subsidiary has a noncontributory defined benefit pension plan covering substantially all of its employees.  As allowed under German law, this plan is not funded. We pay benefits under this plan from revenue generated from the current operations of the German subsidiary. The accrued liability for this plan currently is approximately $12 million.  Given the strong competition in the aperture mask industry, there is a risk that current operations of the German subsidiary cannot cover the ongoing pension payments to retirees. If there were an immediate funding obligation, the German subsidiary would not have sufficient funds to meet the funding requirement. This would have a material adverse impact on the subsidiary as well as financial condition and results of operations of BMC on a consolidated basis.

The Company also has a defined benefit pension plan remaining from our former Vision-Ease Ft. Lauderdale, Florida facility and another plan covering former union employees of our former Buckbee-Mears facility in St. Paul. Both of these plans currently are underfunded due to poor performance of the financial markets during the past few years. Assuming current market conditions, we anticipate that we will be required to make a funding contribution to these plans in 2004. If the value of the assets in these plans continues to decline, we may be required to make a contribution to the plans in 2003.  If that occurs, we may not have sufficient cash on hand or available funds under our credit facility to make the contribution. A current year funding obligation likely also would result in a violation of the covenants under our credit facility. Although we would attempt to obtain a waiver of a covenant violation and obtain additional financing if necessary, there can be no assurance that these efforts would be successful.

Loss of Home Market Advantage . Buckbee-Mears is the only aperture mask manufacturer in North America and one of only two independent mask manufacturers in Europe. As a result, we have maintained a home market advantage over our Asian-based competitors through advantages such as lower transportation costs, faster response times, availability on short notice to meet with our customers and lower costs through the avoidance of importation duties.  This advantage has slowly diminished during the past few years as our customers have closed plants in the U.S. and Europe and moved production to Mexico, China and other countries with a lower cost base. During 2002, our customers closed two plants in the U.S. and one again in 2003. We have developed a strategy to replace this lost business in our home markets, including efforts to grow sales in Asia, particularly in China. We have succeeded in developing new sales in Asia but not at the same rate as our sales have declined in our home markets. The rapid departure of our remaining customers from our home markets or financial difficulties of one of these customers would have an adverse impact on our Buckbee-Mears group if we are not able to successfully replace that business with profitable business in other areas of the world. 

Pricing and Margins.  Many market and economic factors, as well as internal operating performance, have adversely affected, and could continue to affect, our financial performance and projected future results. Since both of our business groups supply components to manufacturers of end products, imbalances in supplies and demand at all levels of product distribution could have, and in some instances have had, a significant impact on our pricing, and margins and inventory levels. Capacity expansions by aperture mask manufacturers helped create this type of imbalance in the mask market a few years ago, which resulted in pricing pressures that continue to impact the Buckbee-Mears group's performance. In addition, margins are affected by the need to develop new technology. Our ability to meet the market demand for new products in a timely fashion requires the investment of resources, which, coupled with pricing pressures, decrease our margins. To offset these pressures and costs, we have implemented several cost reduction measures and are pursuing sales of higher margin products and have taken major steps to reduce our fixed and variable costs in all of our operations, including the transfer of additional lens manufacturing to our Jakarta facility and yield improvement initiatives. These efforts may not be enough to improve revenues, operating performance or margins while remaining competitive in our markets. 

Reliance on key customers.  Both Optical Products and Buckbee-Mears rely on sales to key customers for a large share of sales. Although we strive to differentiate our products and services from those of the competition, we may lose customers due to a number of reasons, including vertical integration of customers into the operations of our competitors, our inability to meet pricing requirements or performance standards and bankruptcy or insolvency of one of these customers. The loss of any of these key customers could have a material adverse effect on the results of our operating groups as well as our consolidated financial condition and results of operations. 

Competition/New Product Development and Introduction.  Each of our operations faces competition from other companies in the same technology as well as competition with alternative technologies. As a result, both Vision-Ease and Buckbee-Mears invest significantly in new product development. Vision-Ease has invested substantial resources towards new lens offerings, particularly in polycarbonate. These efforts have resulted in many new products that have experienced success to date, including our Tegra ®  high-performance polycarbonate product line, Outlook&trdmk; progressive lenses, and SunRx ® polarizing sunwear.  Buckbee-Mears continues its efforts to develop new high-volume product opportunities such as its development efforts in stents. In addition, Buckbee-Mears will continue to dedicate resources towards development of HDTV and multimedia masks. Our long-term success depends on our ability to develop and bring to market these and other new products and technologies at competitive prices and quality in order to compete in each of the markets we serve. There are no assurances, however, that we will succeed in these efforts, that the products of a competitor, for example Trivex, which competes with polycarbonate as a lens material, will not become widely accepted in the industry at the cost of polycarbonate, or that alternative technologies, such as laser eye surgery and LCD televisions, will not replace our products entirely.

Litigation.  We are subject to the normal risks of litigation and other proceedings that affect business operations, including environmental liability for past or present environmental practices, product liability, workers' compensation and personal injury. Although we do not anticipate that any claims will result in liability that could have a materially adverse effect on our financial condition and results of operations, there are no assurances that we will not incur such liability in the future given the uncertainty of litigation.

Sources of Supply.  The primary raw material used to produce masks is steel. The primary raw materials used to manufacture optical products are polycarbonate resin, glass blanks, including photochromic glass, polarizing film and plastic resins. Significant changes in the markets for these materials, including pricing and availability, could have a material adverse impact on our financial results. The main ingredient in plastic resins is petroleum. It is unknown what effect, if any, the war in Iraq will have on the availability and price of oil. A prolonged military engagement or damage to oil reserves could put upward pressure on petroleum prices as well as affect supply. In addition, Vision-Ease relies on a single source manufacturer for its polarizing film and photochromic glass. We have negotiated agreements for these materials, including an agreement for ongoing supply of polarizing film with the manufacturer, as well a backup supply of the film through rights to film of another customer of the manufacturer.  There is no assurance, however, that these agreements will provide sufficient film availability to meet future production requirements or that the manufacturer will not experience production problems that stop the flow of film. In addition, Optical Products obtains the majority of its hard-resin plastic lenses from a foreign supply arrangement and all of its glass lenses and a portion of its polycarbonate lenses from its Jakarta operations.  Factors affecting the supply of these products, in particular political instability in Indonesia, as well as any interruption of the supply of raw materials to our other operations, could have a material adverse impact on our results of operations.

Foreign Currency.  We transact business in currencies other than U.S. dollars. The primary currencies used include the euro, Japanese yen, British pound, Canadian dollar, Hungarian forint, Indonesian rupiah and South Korean won. Our primary competitors in the mask market are located in Asia. Changes in the currency exchange rates between the U.S. dollar and the euro compared to Asian currencies affect Mask Operations' pricing competitiveness. Although we take steps to reduce this risk through cross-currency swaps and other hedging transactions, we are subject to the risk of adverse fluctuations in currency exchange rates, which may result, and have resulted, in pricing pressures and reductions in profitability due to currency conversion or translation.

International Markets. Buckbee-Mears has a manufacturing facility located in Mullheim, Germany and an aperture mask inspection facility in Tatabanya, Hungary. Vision-Ease has optical lens laboratory operations in France, a supply arrangement with hard-resin plastic lens manufacturer in Southeast Asia, and a joint venture in Indonesia for glass and polycarbonate lens manufacturing. In addition, we have many international customers and are dedicating significant resources to increase business with international customers at all of our operations. Our international operations and sales could be adversely affected by the war in Iraq, governmental regulations, political instability, economic changes or instability and competitive conditions in other countries in which, and with which, we conduct business.  Economic difficulty has been experienced in Asia during the recent past and globally during the past few years, which serves as an example of international conditions that can adversely affect financial performance. Future downturns in the global economy or in certain areas of the world could affect our operations without advance warning. Further, there are no assurances that our efforts to grow our business in international markets, such as our efforts to penetrate sales of polycarbonate lenses in Europe through laboratory operations, will be successful.

NYSE Continued Listing. In August 2002, we received a notice of failure to comply with the continued listing requirements of the New York Stock Exchange relating to the price of BMC common stock dropping below $1.00 for 30 consecutive trading days. We brought the stock in compliance with the $1.00 minimum share price requirement within the required six-month period. There is no assurance, however, that we will remain within all of the listing requirements. There are a number of ongoing requirements, including minimum total shareholder equity and minimum aggregate market value requirements that could be triggered if our performance slips or the economy fails to improve.  These listing requirements are more difficult to correct, which could then result in the delisting of BMC common stock from the NYSE. A delisting could impact the market for and value of shares of BMC common stock.

Manufacturing Yields/Customer Service Levels/Fill Rates.  During the first half of 2002, Vision-Ease experienced production problems at its Ramsey facility that coincided with the shutdown of its Azusa production facility and the transfer of production from the Azusa plant to Vision-Ease's facilities in Ramsey and Jakarta. Customer service, fill rates and sales suffered as a result.  Vision-Ease was able to improve its performance and return to historic fill rates. Sales are increasing in response to Vision-Ease's efforts to improve customer service and due to limited ability to source certain products from other manufacturers. If Vision-Ease were to experience a similar situation again, the impact could have a material impact on the long-term performance of the group as customers would be less likely to view Vision-Ease as a reliable source of products.

Bank Covenant Compliance. Our senior credit facility requires compliance with a number of financial and non-financial covenants, including, but not limited to, a maximum debt to EBITDA ratio, a minimum EBITDA to interest expense ratio, a minimum amount of net worth, and a maximum level of capital expenditures. In addition, there are provisions in the current credit agreement that require significant step-downs of certain of these covenant during fiscal year 2003. Given recent financial performance and depending on future business conditions, there is no assurance that we will successfully maintain these covenants in the future. In the event of a covenant default, we would make every effort to secure a waiver from the bank group and/or seek to amend and restate the credit facility to modify the existing covenant levels. A covenant default, if not cured, would have a material impact on our ability to borrow additional funds.

Liquidity.  In September 2002, the company, with its lenders, amended and restated its senior credit facilities and extended the termination date of the facilities to May 2004. The amendment and restatement of the credit facilities also included a monthly borrowing base calculation (which has limited, and may limit in the future, the Company's ability to borrow the full amount of the revolving portion of the facilities) and scheduled quarterly term loan amortization payments of $2.5 million in September and December 2002, and $3.5 million payable quarterly beginning in March 2003. Although we have made significant reductions in debt levels, the outstanding debt can fluctuate significantly during a quarter. As a result, the Company's liquidity position has been constrained and it is possible that our future funding requirements may exceed the credit available under the revolving facilities.  Although we implement working capital initiatives as necessary to manage cash flow tightly, and are in the process of evaluating alternative longer-term financing sources, there is no assurance that these efforts will be sufficient to meet ongoing needs, or that we will be successful in obtaining alternative financing arrangements. Continued weakness in the economy or the markets for our products could intensify the strain on current liquidity.

Item 2. Properties

The following table sets forth certain information regarding our principal production facilities:

Location		Principal Use	Approximate Square Feet of Space
Owned:
	Mullheim, Germany	Buckbee-Mears - Manufacturing of aperture masks and precision photo-etched metal and electroformed products	170,000
	Cortland, NY	Buckbee-Mears - Manufacturing of aperture masks and precision photo-etched metal and electroformed products	363,000
	Tatabanya, Hungary	Buckbee-Mears - Inspection of aperture masks	45,000
	Ramsey, MN	Optical Products - Manufacturing of polycarbonate lenses, centralized distribution and research and development	150,000
	Jakarta, Indonesia	Optical Products - Manufacturing of glass and polycarbonate lenses	66,000
	Azusa, CA	Optical Products - Former Manufacturing Facility (to be sold)	120,000
Leased:
	St. Paul, MN	Buckbee-Mears - Manufacturing of precision photo-etched metal and electroformed parts	118,405

We lease approximately 14,000 square feet in suburban Minneapolis, Minnesota for the corporate headquarters of both BMC and the Optical Products group. We lease approximately 82,000 square feet for customer service, administration and distribution in St. Cloud, Minnesota pursuant to a lease that expires in 2005.  The plant lease in St. Paul expires in February 2004. We are negotiating with the landlord of the St. Paul building to obtain an early release.  During 2002, Vision-Ease exercised an option to purchase the property at its former operations in Azusa for $1.00.  We have listed the property for sale and have retained a broker to assist with the sale. The facility in Jakarta is owned by P.T. Vision-Ease Asia, of which Vision-Ease Lens, Inc. owns 85% and our local partner owns 15%. We believe our existing facilities are sufficient to meet our current and foreseeable production and other needs.

In addition to the properties listed above, we lease space for a distribution center outside London, England, a lens processing laboratory in Brou, France and other smaller domestic and international administrative offices. For additional information concerning our leased properties, see Note 8 to Notes to Consolidated Financial Statements on page 35.

Item 3. Legal Proceedings

With regard to certain environmental and other legal matters, see Item 1(c) "Narrative Description of Business - "Buckbee-Mears - Environmental" and "Optical Products - Environmental" and Item 7 "Management's Discussion and Analysis of Financial Condition and Results of Operations."

Other than as disclosed in the other referenced sections of this report, there are no material pending or threatened legal, governmental, administrative or other proceedings to which we are a party or of which any of our property is subject.

Item 4. Submission of Matters to a Vote of Security Holders

No matter was submitted to a vote of security holders during the fourth quarter of the fiscal year covered by the report.

Part II

Item 5. Market for Registrant's Common Stock and Related Stockholder Matters

BMC's common stock is listed on the New York Stock Exchange under the ticker symbol "BMM". The table below sets forth the high and low reported sales prices of BMC stock by quarter for the years 2002 and 2001. At March 21, 2003, there were approximately 976 stockholders of record.

				Price
	Dividends Per Share			High			Low
2002
First Quarter	$	.0025	$		2.68	$		1.44
Second Quarter	.0025				1.81			0.96
Third Quarter	.0000				1.30			0.41
Fourth Quarter	.0000				1.90			1.00
2001
First Quarter	$	.0150	$		5.85	$		5.00
Second Quarter	.0150				6.28			4.40
Third Quarter	.0150				5.25			2.00
Fourth Quarter	.0025				3.05			1.69

BMC suspended dividends in the third quarter of 2002.

Item 6. Selected Financial Data

The following selected financial data is derived from the consolidated financial statements of the Company and should be read in conjunction with the consolidated financial statements, related notes, and other financial information included herein.

HISTORICAL FINANCIAL SUMMARY

(in thousands, except per share amounts, percentages and ratios)

Years Ended December 31		2002			2001			2000			1999			1998
Summary of Operations
Revenues	$	248,098		$	302,296		$	354,485		$	353,854		$	335,138
Cost of products sold		226,414			276,999			300,795			305,592			297,995
Gross margin		21,684			25,297			53,690			48,262			37,143
Selling and administrative expenses		19,048			21,948			22,552			23,352			20,675
Non-recurring charges		2,800			6,218			--			--			--
Impairment of long-lived assets		--			--			--			--			42,800
Acquired in-process research and development		--			--			--			--			9,500
Earnings (loss) before interest, other income and income taxes		(164	)		(2,869	)		31,138			24,910			(35,832	)
Interest expense, net		(10,347	)		(11,244	)		(12,833	)		(13,099	)		(13,374	)
Other income		1,712			883			2,838			1,036			522
Earnings (loss) before income taxes		(8,799	)		(13,230	)		21,143			12,847			(48,684	)
Income tax expense (benefit)		384			9,370			6,243			5,023			(18,049	)
Change in accounting principle		(52,704	)		--			--			--			--
Net earnings (loss)	$	(61,887	)	$	(22,600	)	$	14,900		$	7,824		$	(30,635	)
Earnings (Loss) Per Share
Basic	$	(2.30	)	$	(0.83	)	$	0.54		$	0.29		$	(1.13	)
Diluted		(2.30	)		(0.83	)		0.54			0.28			(1.13	)
Number of shares included in per share computation
Basic		26,963			27,205			27,396			27,299			27,014
Diluted		26,963			27,205			27,623			27,710			27,014
Cash Flow
Cash dividends declared per share	$	0.005		$	0.0475		$	0.06		$	0.06		$	0.06
Depreciation and amortization expense		20,808			23,807			23,990			23,280			21,014
Net cash provided by operating activities		31,663			17,429			36,785			33,485			26,948
Capital expenditures		8,213			14,134			11,929			13,157			21,427
Financial Position
Working capital	$	44,140		$	70,741		$	95,322		$	88,833		$	94,971
Property, plant and equipment, net		121,334			131,541			139,499			151,238			162,594
Total assets		247,359			331,746			373,804			383,553			399,465
Total debt		112,286			142,168			145,016			168,262			189,195
Stockholders' equity		59,479			116,511			146,798			136,422			133,257
Statistics and Ratios
Current ratio		1.7			2.4			2.5			2.5			2.7
Total debt to equity ratio		1.9			1.2			1.0			1.2			1.4
Earnings (loss) before interest, other income and income taxes, as a percentage of revenues		(0.1	)%		(0.9	)%		8.8	%		7.0	%		(10.7	)%
Return on average equity		(70.3	)%		(17.2	)%		10.5	%		5.8	%		(19.6	)%
Book value per share	$	2.20		$	4.33		$	5.36		$	4.98		$	4.90

  Selected Quarterly Data

(Unaudited, in thousands, except per share amounts)

		First Quarter			Second Quarter			Third Quarter			Fourth Quarter			Total Year
2002
Revenues	$	68,626		$	67,164		$	57,390		$	54,918		$	248,098
Gross margin		5,293			5,589			5,214			5,588			21,684
Net loss		(54,885	)		(2,302	)		(4,185	)		(515	)		(61,887	)
Loss per share
Before accounting change		(0.08	)		(0.09	)		(0.16	)		(0.02	)		(0.34	)
Basic and diluted loss per share		(2.04	)		(0.09	)		(0.16	)		(0.02	)		(2.30	)
Number of shares included in computation:
Basic and Diluted		26,912			26,920			26,951			26,981			26,963
2001
Revenues	$	85,760		$	78,720		$	73,339		$	64,477		$	302,296
Gross margin		11,456			11,957			2,553			(669	)		25,297
Net earnings (loss)		2,046			(7,451	)		(4,146	)		(13,049	)		(22,600	)
Earnings (loss) per share
Basic		0.07			(0.27	)		(0.15	)		(0.48	)		(0.83	)
Diluted		0.07			(0.27	)		(0.15	)		(0.48	)		(0.83	)
Number of shares included in computation:
Basic		27,398			27,393			27,101			26,933			27,205
Diluted		27,633			27,393			27,101			26,933			27,205

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations

This discussion and analysis should be read in conjunction with the Consolidated Financial Statements and related footnotes included elsewhere in this report.

Summary

BMC Industries, Inc. has two business segments; Buckbee-Mears, comprised of Mask Operations and Non-Mask Operations, and Optical Products (operating under the Vision-Ease Lens trade name). Buckbee-Mears is a leading manufacturer of high-volume precision products for the entertainment, high-tech, medical and filtration industries. Optical Products is a leading designer, manufacturer and distributor of polycarbonate, glass and plastic eyewear lenses. 

Net revenues of $248.1 million for 2002 represent a decrease of 18% from the $302.3 million in 2001. The decline in revenue during 2002 was attributable to decreases in both divisions. Buckbee-Mears group sales decreased 19% in 2002 due principally to the Company's decision to exit the monitor mask business and the sale of the Company's non-mask sheet etching business. Optical Products revenues decreased 16% due principally to manufacturing difficulties experienced early in the year, which impacted the Company's ability to fill customer's orders and consequently negatively impacted sales as well as discontinuation of its purchased non-prescription sun lens sales.

Net loss and diluted loss per share for 2002 was $61.9 million and $2.30, respectively, compared to net loss and diluted loss per share of $22.6 million and $0.83, respectively, for 2001.

Critical Accounting Policies and Estimates

The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-going basis, management evaluates its estimates and adjustments, including those related to merchandise returns, bad debts, inventories, intangible assets, income taxes, restructuring costs, retirement benefits, and contingencies and litigation. Management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

Management believes the following critical accounting policies, among others, affect its more significant judgments and estimates used in the preparation of its consolidated financial statements. Management has discussed the development and selection of these critical accounting policies with the audit committee of the board of directors.

Allowance for Doubtful Accounts

The Company maintains an allowance for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments. If the financial condition of the Company's customers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required. The allowance for doubtful accounts was $2.1 million and $2.4 million at December 31, 2002 and 2001, respectively.

Inventory

The Company reduces the stated value of its inventory for estimated obsolescence or impairment in an amount equal to the difference between the cost of inventory and the estimated market value based upon assumptions about future demand, selling prices and market conditions. If actual future demand or market conditions are less favorable than those projected by management, additional reductions in stated value may be required. Significant unanticipated changes in demand or technological development could have a significant impact on the future value of inventory and reported operating results.

Goodwill and Intangible Impairment

In assessing the recoverability of the Company's goodwill and other intangible assets the Company must make assumptions regarding estimated future cash flows and other factors to determine the fair value of the respective assets. If these estimates or their related assumptions change in the future, the Company may be required to record impairment charges for these assets not previously recorded. Effective January 1, 2002, the Company adopted Statement of Financial Accounting Standards (SFAS) No. 142, Goodwill and Other Intangible Assets.  During the first quarter 2002, the Company completed its transitional impairment test using a discounted cash flow model required by SFAS No. 142 and determined that the goodwill in its Optical Products segment was impaired. As such, the Company recorded as a cumulative effect of change in accounting principle a write-off of its goodwill balance in the amount of $52,704 on which the Company recognized no tax benefit.  Additional discussion is included in note 3 of the consolidated financial statements.

Income Taxes

In determining the carrying value of the Company's net deferred tax assets, the Company must assess the likelihood of sufficient future taxable income in certain tax jurisdictions, based on estimates and assumptions to realize the benefit of these assets. If these estimates and related assumptions change in the future, the Company may be required to record additional valuation allowances against its deferred tax assets, resulting in additional income tax expense in the Company's consolidated statement of operations. Management evaluates the realizability of the deferred tax assets quarterly and assesses the need for additional valuation allowances or reduction of existing allowances quarterly. 

Retirement Benefits

Employee pension costs and obligations are dependent on assumptions used by actuaries in calculating estimated future benefits to be paid. These assumptions may include discount rates, long-term return on plan assets, mortality rates and other factors. Actual results that may differ from the assumptions used are accumulated and amortized over future periods and, therefore can affect our recognized expense and recorded obligation in those future periods. While management believes the assumptions used are appropriate, significant differences in actual experience or significant changes in assumptions would affect pension costs and obligations. Additional discussion on employee benefit plans is included in note 10 of the consolidated financial statements.

Contingent Liabilities

Reserves are established for estimated loss contingencies when it is determined that a loss is probable and the amount of the loss can be reasonably estimated.  Reserves for contingent liabilities are based upon management's assumptions and estimates, as well as advice of legal counsel or other third parties regarding the probable outcome of the matter.  If circumstances change, different facts or information become known or the actual outcome differs from the assumptions, revision to the estimated reserves would be recorded and reflected in the statement of operations in the period in which these changes occur. 

Restructuring Initiatives

Beginning in the fourth quarter 2001 and continuing into 2002, the Company executed significant restructuring initiatives in both the Buckbee-Mears and Optical Products business groups. 

The Buckbee-Mears group's Mask Operations exited the computer monitor segment of the aperture mask business and a portion of Non-mask Operations was sold to a third party.  The remaining non-mask operations in St. Paul, Minnesota were consolidated into its other facilities in Cortland, New York and Mullheim, Germany. These actions have resulted in staffing reductions at all of the group's manufacturing sites with the ceasing of operations at the St. Paul facility in January 2003. The Company is currently undergoing decommissioning and site restoration at that facility, which should be completed by the end of 2003.

During 2002, the Optical Products group discontinued certain Vision-Ease product development activities, discontinued or phased-out certain product categories and closed its production facility in Azusa, California and consolidated the Optical Products group's operations into its two remaining facilities. Additional polycarbonate lens manufacturing capacity was transferred to the Jakarta, Indonesia plant and polarized lens manufacturing was consolidated in the Ramsey, Minnesota facility. In first quarter 2002, the Company recorded additional restructuring expenses of $2.8 million related to the closure of the Azusa facility.

Results of Operations

The following discussion and analysis examines the operating results of the Company's two business segments. As used herein, "operating income" refers to operating income before non-recurring charges, administrative expense and interest, as shown in Note 12 to the Consolidated Financial Statements - Segment Information.

Revenues and Operating Profit

Buckbee-Mears

Comparison of 2002 and 2001.   Buckbee-Mears group revenues were $138.0 million for 2002, a decrease of $32.9 million or 19% from 2001. Sales of monitor masks decreased $28.2 million from 2001 due to the Company's exit of this segment of the business during 2002. Sales of entertainment masks were $1.1 million lower than 2001 due to declining prices in this market which were partially offset by increased volume. The remainder of the sales decline was due to the sale of the Company's non-mask sheet etching business in the first half of 2002.

Operating income for Buckbee-Mears was $9.1 million in 2002, an increase of approximately $4.0 million from the prior year. The 2001 operating income was reduced by restructuring related inventory write-offs of $2.4 million and other asset write-downs of $1.4 million. Excluding these restructuring related charges, operating income for 2002 was consistent with 2001. Operating margin in 2002 was 7% of revenues compared to 3% in 2001.  Excluding the restructuring related charges in 2001, operating margin was 5% of revenues. The increase in margin in 2002 is a reflection of the Company's restructuring and cost reduction efforts at the end of 2001 and during 2002.

Comparison of 2001 and 2000.   Buckbee-Mears group revenues were $170.9 million for 2001, a decrease of $44.0 million or 20% from 2000. Sales of entertainment masks decreased 15% from sales in 2000 and computer monitor mask sales decreased 30% compared to 2000. Sales of entertainment masks were impacted by a decline in demand beginning in the first half of the year, especially in the NAFTA market, as well as price reductions during the last part of 2001. Sales of monitor masks were negatively impacted by year-over-year price reductions and contraction in demand for computer products. Non-Mask Operations revenue declined 34% from 2000 as the Company's customers reacted to slow demand in the semiconductor, automotive and telecommunications segments.

Operating profit for Buckbee-Mears was $5.1 million for 2001, before non-recurring charges of $5.0 million, a decrease of $20.0 million from 2000. The operating margin was 3% of revenues for 2001 compared to 12% for 2000. The decrease in operating profit was primarily due to reduced demand for television products, which accelerated in the second quarter of the year. Pricing pressures in both the computer mask and television mask markets and low plant utilization also had negative impacts on operating profits and margins. The Company began taking action in the second quarter of 2001 to reduce costs, first by bringing down one line in Cortland, N.Y. during second quarter and then by extending the annual third quarter plant shutdown by a few weeks. Operating profit was also impacted by costs incurred as a result of restructuring initiatives commencing in the fourth quarter. Inventory write-offs of $2.6 million and other asset write-downs of $1.4 million were recorded as a result of the decision to exit the computer monitor mask business and to sell or consolidate into other facilities operations currently located in St. Paul, Minnesota. The effect of foreign currency translation had a nominal impact on the group's operating profit.

Optical Products

Comparison of 2002 and 2001.  Optical Products group revenues were $110.1 million in 2002, a decrease of $21.3 million or 16% from 2001. Sales in 2002 were affected by exiting some low margin business, manufacturing difficulties experienced in the first part of the year and greater than expected service disruption from the transfer of production from Azusa to the manufacturing facilities in Ramsey, Minnesota and Jakarta, Indonesia. These manufacturing issues hampered the Company's ability to fully meet customer demand. Sales in all product categories decreased from 2001 levels.  Polycarbonate sales decreased 7%, plastic sales decreased 35% and glass sales decreased 14% from 2001 sales levels.

Operating loss for Optical Products was $0.3 million for 2002, excluding non-recurring charges of $2.8 million, compared to an operating profit of $3.3 million in 2001.  Operating income in 2001 was impacted by costs incurred as a result of restructuring initiatives commencing in the fourth quarter of 2001. Inventory write-offs of $1.0 million and other asset write-downs of $1.0 million were recorded in 2001 for discounted or phased-out product categories. The decrease in operating income in 2002 was due to the decrease in sales of the higher margin polycarbonate products and due to manufacturing difficulties experienced in the early part of the year. The operating income was also negatively impacted by the transfer of and initial ramp up of production from the Azusa, California facility to Ramsey, Minnesota and Jakarta, Indonesia. The Company stopped production at the Azusa plant in second quarter 2002, closed its residual marketing and distribution functions in fourth quarter and is currently in the process of marketing these facilities for sale.

Comparison of 2001 and 2000.  Optical Products group revenues were $131.4 million in 2001, a decrease of $8.2 million or 6% from 2000. The decrease was due to soft retail demand and capacity constraints in premium product categories in the first part of the year and declines in sales in the last part of the year following the events of September 11, 2001.  Sales of high end products decreased 5% from 2000. Much of the decrease was attributable to declines in sales of mainline polycarbonate lenses, SunSport ® non-ophthalmic lenses and Tegra ® - -coated polycarbonate lenses. Strong sales in the SunRx ® premium polarized lenses (increasing 15% over 2000) offset some of the sales reductions in other product lines.  Sales of glass lenses continue to decline year over year.

Operating profit of Optical Products was $3.3 million for 2001, excluding non-recurring charges of $1.2 million, a decrease of $8.1 million or 71% from 2000. The decrease in margin was due in part to reductions in sales of higher margin premium products and higher production costs related to low plant utilization. Operating profit was also impacted by costs incurred as a result of restructuring initiatives commencing in the fourth quarter of 2001. Inventory write-offs of $1.0 million and other asset write-downs of $1.0 million were recorded in 2001 for discounted or phased-out product categories. 

Selling Expenses

Selling expenses were $12.9 million, $16.9 million and $17.2 million or 5.2%, 5.6% and 4.8% of revenues for 2002, 2001 and 2000, respectively. The decrease in 2002 is due to lower sales in the Optical Group which reduced costs which are directly linked to sales volumes. Selling expenses in Buckbee-Mears Group's non-mask operations were also lower due to the restructuring initiatives and sale of the sheet etching business in 2002.  The decrease in 2001 was due primarily to lower expenses in the Buckbee-Mears segment as a result of cost reduction efforts, including personnel reductions, initiated mid-year when sales demand began to decline. The Optical Products group's selling expenses for 2001 were even with 2000 expenses.

Administrative Expenses

Administrative expenses were $6.1 million, $5.0 million and $5.4 million or 2.5%, 1.7% and 1.5% of revenues for 2002, 2001 and 2000, respectively.  The increase in administrative expenses in 2002 is due to costs associated with the recruiting and hiring of a new CEO, costs related to the search for new board members and increased legal and consulting expenses related primarily to amendment of the Company's credit agreement. The increase in expenses as a percentage of sales in 2002 is primarily due to the decrease in sales from the previous years. The decrease in administrative expenses from 2000 to 2001 was due to performance-based employee incentive benefits tied to the Company's earnings, which were incurred in 2000 but not in 2001.

Interest Expense (Income)

Interest expense was $10.6 million, $11.8 million and $13.1 million for 2002, 2001 and 2000, respectively. Interest income was $0.2 million, $0.5 million and $0.3 million for 2002, 2001 and 2000, respectively. Interest expense decreased in both 2002 and in 2001 due to lower overall debt levels and LIBOR rates in those years. The impact from lower debt levels and lower LIBOR rates was offset during 2002 by increased credit spreads and fees as a result of amendments to the Company's senior credit agreement.

Income Taxes

The Company's effective tax rate, exclusive of deferred tax asset valuation reserve adjustments, was 23%, 39% and 30% in 2002, 2001 and 2000, respectively. The change in the tax rates was primarily due to the Company's domestic and foreign earnings mix.

Realization of the Company's net deferred tax asset is dependent on future taxable income.  During 2002, the Company increased its deferred tax asset valuation reserve from $14.5 million to $28.9 million, the effect of which increased income tax expense by $14.4 million.  The need for the valuation reserve was driven by projections for future U.S. taxable income, which impacts the potential for realizing the benefits of the Company's carryovers. The statutory time period for using the carryovers on its income tax returns extends beyond the period the Company used to assess impairment for accounting purposes. If, at some time in the future, it is determined that all or a portion of the existing carryovers may be realized, the valuation reserve will be reduced accordingly.

Seasonality

The Company's earnings have been generally lower in the first and third quarters due to maintenance shutdowns at the Company's mask production facilities during those periods.  Also, the seasonality of end products in several markets (televisions, computer monitors and ophthalmic lenses) affects the Company's annual earnings pattern.

Dividends

In August 2002, the Company suspended payment of cash dividends on its common stock.  Cash dividends of one-quarter cent per share were declared in the first and second quarters of 2002.

Environmental

The Company's operations are subject to federal, state, local and foreign environmental laws and regulations. Under the Comprehensive Environmental Response Compensation and Liability Act of 1980, as amended (CERCLA or Superfund), the Company has been designated as a potentially responsible party (PRP) by the United States Environmental Protection Agency with respect to certain waste sites at which the Company may have had direct or indirect involvement. Similar designations have been made by some state environmental agencies under applicable state environmental laws. Such designations are made regardless of the extent of the Company's involvement. Such designations have been made by the filing of a complaint, the issuance of an administrative directive or order, or the issuance of a notice or demand letter. These actions are in various stages of administrative or judicial proceedings.  They include demands for recovery of past governmental costs and/or for future investigative or remedial actions. In many cases, the dollar amount of site costs or the Company's portion of site costs is not specified. In most cases, however, the Company has been designated a de minimis party and claims have been asserted against a number of other entities for the same recovery or other relief as was asserted against the Company.  The Company is currently participating in eight environmental and/or remedial actions in which final settlement has not been reached.

To the extent possible, and with the amount of information available at this time, the Company has evaluated its responsibility for costs and related liability with respect to the above investigations and/or remedial actions, and has recorded reserves for such liability in accordance with generally accepted accounting principles. It is the Company's opinion that the Company's liability with respect to these matters should not have a material adverse effect on the financial position or the results of operations of the Company. In arriving at this conclusion, the Company has considered, among other things, the payments that have been made in the past; the factors, such as volume and relative toxicity, ordinarily applied to allocated defense and remedial costs; the probable costs to be paid by the other potentially responsible parties; total projected remedial costs, to the extent known; existing technology; and currently enacted laws and regulations. A portion of the costs and related liability for these matters has been or will be covered by insurance or third parties.

In September 2002, the Company reached an agreement with the Environmental Protection Agency regarding the Resource Conservation Recovery Act. The settlement relates primarily to past housekeeping practices at the Company's St. Paul facility. Under the settlement agreement, the Company will make four equal payments totaling $0.3 million over the next two years. The settlement was expensed in third quarter 2002 and the first installment was made in fourth quarter. An accrued liability of $0.2 million is included in accrued expenses on the Company's consolidated balance sheet at December 31, 2002.

Financial Position and Liquidity

Working capital was $44.1 million and the current ratio was 1.7 at December 31, 2002, compared to $70.7 million and a current ratio of 2.4 at December 31, 2001. Accounts receivable balances decreased $7.4 million compared to 2001 due primarily to lower sales in both segments from the exit of the computer monitor mask business, the sale of the Company's non-mask sheet etching business and the discontinuation of its purchased non-prescription sun lens sales.  Inventory levels were lower than 2001 due to initiatives to manage raw materials purchases reducing the inventory balances on hand. Finished goods balances were also lower in the Buckbee-Mears segment.  Accounts payable and other liabilities increased primarily due to extended payment terms with certain vendors in 2002.

At December 31, 2002, the Company had $112.3 million in debt and the ratio of total debt to total equity was 1.9. The $29.9 million reduction in debt was due primarily to management of and reduction in the Company's working capital in 2002. At December 31, 2001, the Company had $142.2 million in debt and the ratio of total debt to total equity was 1.2.

In 2002, the Company generated $31.7 million of cash flow from operating activities and $6.3 million from sales of assets, including certain property and equipment. The cash generated from operating activities and asset sales was used primarily for debt reduction of $29.9 million and property, plant and equipment additions totaling $8.2 million. In 2001, the Company generated $17.4 million of cash flow from operating activities. The cash generated from operating activities was used primarily for debt reduction totaling $2.8 million and property, plant and equipment additions totaling $14.1 million. In 2000, the Company generated $36.8 million of cash flow from operating activities. The cash generated from operating activities was used primarily for debt reduction totaling $23.3 million and property, plant and equipment additions totaling $11.9 million.

Capital spending in 2003 is planned to be approximately $11.4 million. It is currently anticipated that 2003 capital expenditures will be financed primarily with funds from operations.

In September 2002, the Company amended and restated its domestic credit agreement (the Agreement) and extended the termination date of the credit Agreement from May 2003 to May 2004. The amendment and restatement of the Agreement reduced the aggregate commitment from $185 million to $145 million ($110 million of term loans and $35 million of revolving commitment) and converted certain previously outstanding revolving loans to term loans. This Agreement is secured by a pledge of certain shares of common stock of the Company's subsidiaries, an intercompany note from one of the Company's European holding companies; security interests in certain assets, including but not limited to, all deposit accounts, receivables, inventories, machinery and equipment and intangible assets, as well as mortgages on its real property located in Ramsey, Minnesota and Cortland, New York. The agreement incorporates scheduled term loan amortization payments of $2.5 million per quarter, which were made in the third and fourth quarters of 2002; and $3.5 million per quarter payable beginning in 2003 through the termination date. The Agreement also includes a monthly borrowing base calculation, which may impact the ability of the Company to utilize its total revolving commitment.  The Company's borrowing base under the revolver commitment as of December 31, 2002 was $31.3 million.

As of December 31, 2002, there was $111.5 million outstanding under the Agreement with available credit of $22.5 million. The Company believes that internally generated funds and unused financing sources will be adequate to meet the its financing requirements for 2003. The Company was in compliance with all covenants under the Agreement at December 31, 2002.

The Company's Buckbee-Mears Europe subsidiary maintains a short-term credit facility in Germany for German and Hungarian operations with total credit of approximately $8.1 million. As of December 31, 2002, $0.7 million was outstanding under this facility and approximately $7.3 million of available credit reserved.

The Company is currently assessing alternative financing arrangements in anticipation of the May 2004 expiration date of its current domestic credit agreement. There is no assurance that new credit arrangements or alternative financing terms will be available, or if available with be on terms comparable to those in the current agreement.

Market Risk

Foreign Currency

A portion of the Company's operations consists of manufacturing and sales activities in foreign jurisdictions. The Company manufactures its products in the United States, Germany, Hungary and Indonesia and purchases products from Asian, as well as other foreign suppliers. The Company sells its products in the United States and into various foreign markets.  The Company's sales are typically denominated in either the U.S. dollar or the European Euro. Buckbee-Mears also has an indirect exposure to the Japanese yen and the Korean won because its most significant competitors are Japanese and Korean. As a result, the Company's financial results could be significantly affected by factors such as changes in foreign currency exchange rates or weak economic conditions in foreign markets. In addition, sales of products overseas are affected by the value of the U.S. dollar relative to other currencies. Long-term strengthening of the U.S. dollar may have an adverse effect on these sales and competitive conditions in the Company's markets and may limit the Company's ability to increase product pricing in times of adverse currency movements.

To manage the volatility relating to its direct exposures, the Company from time to time will utilize various derivative instruments, including foreign currency forward-exchange contracts and cross-currency swaps. The cross-currency swaps are accounted for under mark-to-market accounting. At December 31, 2002 and 2001, the Company had no outstanding foreign currency forward-exchange contracts.

The Company experiences foreign currency gains and losses, which are reflected on the Company's Statements of Operations, due to the strengthening and weakening of the U.S. dollar against the currencies of the Company's foreign subsidiaries and the resulting effect on the valuation of inter-company and other accounts. The net exchange gain (loss) was $(0.9) million in 2002, $0.2 million in 2001 and $(0.3) million in 2000. The Company anticipates that it will continue to incur exchange gains and losses from foreign operations in the future.

The Company's net investment in foreign subsidiaries with non-U.S. dollar functional currency was $27.9 million and $26.1 million at December 31, 2002 and 2001, respectively, translated into U.S. dollars at year-end exchange rates. The potential loss in value resulting from a hypothetical 10% reduction in foreign currency exchange rates is $2.5 million and $2.4 million in 2002 and 2001, respectively. The loss, if incurred, would be recorded as a charge to Accumulated Other Comprehensive Income (Loss).

During 2002, the U.S. dollar weakened against the Euro. During 2001 and 2000, the U.S. dollar strengthened against the German mark (DM). A stronger dollar generally has a negative impact on overseas results because foreign currency-denominated earnings translate into less U.S. dollars; a weaker dollar generally has a positive translation effect. However, a significant component of our overseas revenue is U.S. dollar based, somewhat mitigating this effect. As a result, the effect of the change in exchange rates for 2002, 2001 and 2000 did not have a material impact on net earnings.

Interest

Substantially all of the Company's debt and associated interest expense is sensitive to changes in the level of interest rates. To mitigate the impact of fluctuations in interest rates, the Company from time to time enters into interest rate swaps to hedge the exposure of a portion of its floating-rate debt. The Company's primary interest rate exposure is U.S., and to a lesser extent Euro and yen-based interest rates. 

At various dates during 1999 and 2000, the Company entered into multiple interest rate swap agreements to provide for the Company to swap a variable interest rate for fixed interest rates ranging from 6.7% to 7.1%. At December 31, 2002, $50 million of these swaps remained outstanding with the swaps expiring in equal amounts in May 2003 and June 2003.

A hypothetical 100 basis point increase in interest rates would result in a $0.6 million and $0.9 million adverse impact on interest expense in 2002 and 2001, respectively.

Euro Currency Conversion

On January 1, 1999, 11 of the 15 member countries of the European Union, including Germany, adopted the euro as their common legal currency.  The euro trades on currency exchanges and is available for non-cash transactions. From January 1, 1999 through January 1, 2002, each of the participating countries was scheduled to maintain its national (legacy) currency as legal tender for goods and services. Beginning January 1, 2002, new euro-denominated bills and coins have been issued, and legacy currencies were withdrawn from circulation by July 1, 2002. The Company's foreign operating subsidiaries that were affected by the euro conversion had established plans to address the business issues raised, including the competitive impact of cross-border price transparency. There were no near-term business ramifications of the conversion to Euro; however, the long-term implications, including any changes or modifications that will need to be made to business and financial strategies, are still being reviewed. From an accounting, treasury and computer system standpoint, the impact from the euro currency conversion did not have a material impact on the financial position or results of operations of the Company.

Cautionary Statements

Certain statements included in this Management's Discussion and Analysis, as well as other communications, including its filings with the SEC, reports to shareholders, news releases and presentations to securities analysts or investors, contain forward-looking statements made in good faith by the Company pursuant to the "Safe Harbor" provisions of the Private Securities Litigation Reform Act of 1995.  These statements relate to non-historical information and include, without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements. We wish to caution the reader not to place undue reliance on any such forward-looking statements. These statements are not guarantees of future performance and are subject to a number of risks and uncertainties detailed from time to time in reports filed by BMC with the SEC, including the disclosure in the Form 10-K under "Risk Factors" and elsewhere in Forms 10-Q and 10-K, that could cause actual results or outcomes to differ materially from those presently anticipated or projected and include, among others, ability to manage working capital and align costs with market conditions; continued imbalance in supply and demand for computer monitor masks; further aperture mask price declines; slowdown in growth of high-end lens products; rising raw material costs; ability to improve manufacturing yields and operating efficiencies; ability to qualify new products with customers; consumer demand for direct-view high-definition television and digital receivers; competition with alternative technologies and products, including laser surgery for the correction of visual impairment and LCD, plasma, projection and other types of visual displays; ability to source plastic lens product requirement from third parties; ability to gain market share of polycarbonate products both domestically and abroad, including growth in European sales through the operation of processing laboratories; higher than expected restructuring related costs; ability to restructure the Non-Mask Operations and diversify its customer and product base; the effect of regional or global economic slowdowns; the impact of domestic or global terrorism on consumer spending choices; adjustments to inventory valuations; liability and other claims asserted against BMC; negative foreign currency fluctuations; and ability to recruit and retain key personnel.  These factors should not, however, be considered an exhaustive list. We do not undertake the responsibility to update any forward-looking statement that may be made from time to time by or on behalf of BMC.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Disclosures about market risks appear on pages 21-22 of the "Management's Discussion and Analysis" for the year ended December 31, 2002.

Item 8.  Financial Statements and Supplementary Data

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share amounts)

Years Ended December 31		2002			2001			2000
Revenues	$	248,098		$	302,296		$	354,485
Cost of products sold		226,414			276,999			300,795
Gross margin		21,684			25,297			53,690
Selling expense		12,924			16,910			17,163
Administrative expense		6,124			5,038			5,389
Non-recurring charges		2,800			6,218			--
Income (loss) from operations		(164	)		(2,869	)		31,138
Other income and (expense)
Interest expense		(10,588	)		(11,752	)		(13,115	)
Interest income		241			508			282
Other income		1,712			883			2,838
Earnings (loss) before income taxes and
cumulative effect of change in accounting principle		(8,799	)		(13,230	)		21,143
Income tax expense		384			9,370			6,243
Earnings (loss) before accounting change		(9,183	)		(22,600	)		14,900
Cumulative effect of change in accounting principle		(52,704	)		--			--
Net earnings (loss)	$	(61,887	)	$	(22,600	)	$	14,900
Basic and diluted earnings (loss) per share
Before cumulative effect of accounting change	$	(0.34	)	$	(0.83	)	$	0.54
Cumulative effect of accounting change		(1.96	)		--			--
Net earnings (loss) per share	$	(2.30	)	$	(0.83	)	$	0.54
Number of shares included in per share computation
Basic		26,963			27,205			27,396
Diluted		26,963			27,205			27,623

 See Notes to Consolidated Financial Statements.

CONSOLIDATED BALANCE SHEETS

(in thousands)

December 31		2002			2001
Assets
Current Assets
Cash and cash equivalents	$	1,635		$	1,941
Trade accounts receivable, less allowances of $2,137 and $2,368		27,660			35,024
Inventories		59,736			71,634
Deferred income taxes		9,492			10,250
Other current assets		6,350			4,197
Total current assets		104,873			123,046
Property, plant and equipment, net		121,334			131,541
Deferred income taxes		3,083			7,166
Intangible assets, net		12,141			62,069
Other assets, net		5,928			7,924
Total assets	$	247,359		$	331,746
Liabilities and Stockholders' Equity
Current Liabilities
Short-term borrowings		747			546
Current portion of long-term debt		14,010			308
Accounts payable		25,113			19,707
Accrued compensation and benefits		7,616			9,695
Income taxes payable		3,416			7,532
Deferred income taxes		88			--
Accrued restructuring expenses		2,265			5,038
Accrued liability for derivative instruments		1,154			2,794
Other current liabilities		6,324			6,685
Total current liabilities		60,733			52,305
Long-term debt		97,529			141,314
Pension and other employee retirement obligations		23,758			15,843
Other liabilities		4,705			4,171
Deferred income taxes		1,155			1,602
Stockholders' Equity
Common stock (shares issued of 27,066 and 26,910)		46,949			46,786
Retained earnings		19,957			81,979
Accumulated other comprehensive loss		(7,358	)		(12,180	)
Other		(69	)		(74	)
Total stockholders' equity		59,479			116,511
Total liabilities and stockholders' equity	$	247,359		$	331,746

See Notes to Consolidated Financial Statements.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(in thousands, except per share amounts)

Years Ended December 31, 2002, 2001 and 2000		Common Stock			Retained Earnings		Accumulated  Other Comprehensive Loss				Other			Total
Balance at December 31, 1999	$	49,077		$	92,620		$	(3,495	)	$	(1,780	)	$	136,422
Comprehensive income:
Net earnings		--			14,900			--			--			14,900
Foreign currency translation adjustments		--			--			(2,027	)		--			(2,027	)
Loss on derivative instruments		--			--			(1,147	)		--			(1,147	)
Total comprehensive income														11,726
Exercise of options, including tax benefit		15			--			--			--			15
Restricted stock grants, net of forfeitures and including tax benefits		148			--			--			--			148
Repayments of stock option loans		--			--			--			131			131
Cash dividends declared-$0.06 per share		--			(1,644	)		--			--			(1,644	)
Balance at December 31, 2000		49,240			105,876			(6,669	)		(1,649	)		146,798
Comprehensive loss:
Net loss		--			(22,600	)		--			--			(22,600	)
Foreign currency translation adjustments		--			--			(1,500	)		--			(1,500	)
Loss on derivative instruments		--			--			(1,676	)		--			(1,676	)
Minimum pension liability		--			--			(2,335	)		--			(2,335	)
Total comprehensive loss														(28,111	)
Exercise of options, including tax benefit		736			--			--			--			736
Restricted stock grants, net of forfeitures and including tax benefits		171			--			--			--			171
Exchange of common stock as repayment of stock option loans		(3,361	)		--			--			1,575			(1,786	)
Cash dividends declared-$0.0475 per share		--			(1,297	)		--			--			(1,297	)
Balance at December 31, 2001		46,786			81,979			(12,180	)		(74	)		116,511
Comprehensive loss:
Net loss		--			(61,887	)		--			--			(61,887	)
Foreign currency translation adjustments		--			--			4,625			--			4,625
Gain on derivative instruments		--			--			1,700			--			1,700
Minimum pension liability		--			--			(1,503	)		--			(1,503	)
Total comprehensive loss														(57,065	)
Stock grants		50			--			--			--			50
Restricted stock grants, net of forfeitures and including tax benefits		113			--			--			--			113
Repayment of stock option loans		--			--			--			5			5
Cash dividends declared-$0.005 per share		--			(135	)		--			--			(135	)
Balance at December 31, 2002	$	46,949		$	19,957		$	(7,358	)	$	(69	)	$	59,479

Common Stock:  99,000 shares of voting common stock without par value authorized; 27,066, 26,910, 27,399 shares issued and outstanding at December 31, 2002, 2001 and 2000, respectively. 

Undesignated Stock:  500 shares authorized, of which 200 shares were designated as Series A Junior Participating Preferred Shares on June 30, 1998 in connection with the Company's adoption of a Share Rights Plan.  The Board of Directors is authorized to designate the name of each class or series of the undesignated shares and to set the terms thereof (including, without limitation, terms with respect to redemption, dividend, liquidation, conversion and voting rights and preferences.) 

See Notes to Consolidated Financial Statements.

CONSOLIDATED STATEMENTS OF CASH FLOW

(in thousands)

Years Ended December 31		2002			2001			2000
Cash Flows from Operating Activities
Net earnings (loss)	$	(61,887	)	$	(22,600	)	$	14,900
Adjustments to reconcile net (loss) earnings to net cash provided by operating activities
Depreciation and amortization		20,808			23,807			23,990
Write-off of goodwill		52,704			--			--
Gain on sale of property and equipment		(3,429	)		(74	)		(443	)
Deferred income taxes		4,451			5,571			(983	)
Other non-cash income and expense items		163			173			148
Decrease (increase) in assets
Trade accounts receivable		8,198			9,877			(4,235	)
Inventories		13,723			9,500			(1,084	)
Other current assets		(2,098	)		6,059			1,106
Other non-current assets		(2,321	)		(3,002	)		(835	)
Increase (decrease) in liabilities
Accounts payable		4,489			(13,891	)		4,033
Income taxes payable		(4,307	)		1,406			(1,387	)
Accrued expenses and other current liabilities		(7,460	)		2,188			2,767
Other non-current liabilities		8,629			(1,585	)		(1,192	)
Net cash provided by operating activities		31,663			17,429			36,785
Cash Flows from Investing Activities
Additions to property, plant and equipment		(8,213	)		(14,134	)		(11,929	)
Business acquisitions, net of cash acquired		--			--			(1,219	)
Proceeds from sales of assets, including property and equipment		6,349			743			2,493
Net cash used in investing activities		(1,864	)		(13,391	)		(10,655	)
Cash Flows from Financing Activities
Increase (decrease) in short-term borrowings		13,777			(328	)		(959	)
Decrease in long-term debt		(43,785	)		(2,496	)		(22,149	)
Common stock issued, including tax benefit		--			--			15
Cash dividends paid		(203	)		(1,640	)		(1,644	)
Net employee repayments of stock option loans		5			132			131
Net cash used in financing activities		(30,206	)		(4,332	)		(24,606	)
Effect of exchange rate changes on cash and cash equivalents		101			(55	)		(380	)
Net increase (decrease) in cash and cash equivalents		(306	)		(349	)		1,144
Cash and cash equivalents at beginning of year		1,941			2,290			1,146
Cash and cash equivalents at end of year	$	1,635		$	1,941		$	2,290

 See Notes to Consolidated Financial Statements.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars and shares in thousands, except per share amounts)

1.     Summary of Significant Accounting Policies

The Consolidated Financial Statements include the accounts of the Company and its subsidiaries, all of which are wholly or majority-owned.

Revenue Recognition --Revenue is recognized upon shipment of product to the customer, when persuasive evidence of an arrangement exists, the price to the buyer is fixed and determinable, and collectibility is reasonably assured.

Shipping and handling costs are included in cost of products sold.

Cash Equivalents --Consist of highly liquid debt instruments with maturities of three months or less at the date of purchase. These instruments are carried at cost, which approximates fair market value.

Inventories --Stated at the lower of cost or market. Cost is determined principally on the average cost method.

Provisions for Inventory Reserves, Uncollectible Trade Receivables and Product Returns - --The Company determines its provision for obsolete and slow-moving inventory based on management's analysis of inventory levels and future sales forecasts. However, the factors impacting such provisions vary significantly between the Buckbee-Mears and Optical Products segments. Within the Buckbee-Mears segment, products are manufactured to customer specifications and changes in product demand from the loss of a customer, a new product offering or modifications to customer specifications can significantly impair the value of raw material and finished goods on hand. As a result, inventory valuation reserve requirements within this segment must be established based on specific facts and circumstances that can fluctuate significantly and are difficult to predict.  We do not anticipate these conditions will change due to the customized nature of the products manufactured by the Buckbee-Mears segment. The Optical Products segment inventory reserve requirements historically have been more predictable and more readily estimated by analyzing historic build and sales patterns.

The Company establishes a reserve and records a provision for doubtful receivable accounts based on historic loss levels as well as specific provisions considering current facts and circumstances. Both the Buckbee-Mears and Optical Products segments have several large customers that, if circumstances warrant, can create the need for additional, specific, reserves.

The provision and reserve for product returns is calculated primarily on a percentage of sales basis, which is established based on trends that have historically provided a reasonable estimate.  This reserve is also calculated on a specific basis considering current facts and circumstances.

Property, Plant and Equipment - --Stated at cost. Additions, improvements or major renewals are capitalized, while expenditures that do not enhance or extend the asset's useful life are charged to operating expense as incurred. Depreciation is provided on the straight-line method over estimated useful lives of generally 40 years for buildings, 20 years for building improvements and infrastructure and 8 years for machinery and equipment.  Depreciation of assets included in construction in progress does not begin until the construction is complete and the assets are placed into service. Depreciation expense was $19,789, $20,272 and $20,504 in 2002, 2001 and 2000, respectively.

The Company evaluates long-lived assets for impairment whenever changes in circumstances indicate that the carrying amount of the asset may not be recoverable.

Intangible Assets --Consist primarily of capitalized patent costs and acquisition-related intangible assets, which are stated at fair value as of the date acquired in a business acquisition accounted for as a purchase, less accumulated amortization. Amortization is computed on a straight-line basis over estimated useful lives of 10 to 30 years. Amortization expense was $1,019, $3,535 and $3,486 in 2002, 2001 and 2000, respectively. Amortization expense is expected to be approximately $1,000 for each of the next five years.

The Company adopted Statement of Financial Accounting Standard (SFAS) No. 142, Goodwill and Other Intangible Assets, effective January 1, 2002, which resulted in the write-off of its goodwill balance of $52,704. See footnote 3 for additional discussion regarding the implementation of SFAS No. 142.

Income Taxes --A deferred tax liability is recognized for temporary differences between financial reporting and tax reporting that will result in taxable income in future years. A deferred tax asset is recognized for temporary differences that will result in tax deductions in future years.

Comprehensive Income (Loss) - --Comprehensive Income (Loss) consists of net earnings, foreign currency translation adjustments, gains/losses on derivative instruments and adjustments for minimum pension liability and is presented in the Consolidated Statements of Stockholders' Equity. The accumulated gain (loss) on derivative instruments was $(1,154), $(2,854) and $(1,178) as of December 31, 2002, 2001 and 2000, respectively.  The accumulated foreign currency translation gain (loss) was $(2,366), $(6,991) and $(5,491) as of December 31, 2002, 2001 and 2000, respectively. The accumulated minimum pension liability was $3,838 and $2,335 as of December 31, 2002 and 2001, respectively.

Earnings Per Share --The basic earnings per share amounts are determined based on the weighted average common shares outstanding, while the diluted earnings per share amounts also give effect to the common shares dilutive potential.  For the Company's earnings per share calculations, the basic and diluted weighted average outstanding share amounts differ only due to the dilutive impact of stock options and non-vested stock awards.

Stock-Based Compensation --The Company has elected to follow Accounting Principles Board Opinion No. 25 (APB 25), "Accounting for Stock Issued to Employees," and related interpretations in accounting for its employee stock options and non-vested stock awards. Under APB 25, because the exercise price of employee stock options equals the market price of the underlying stock on the date of grant, no compensation expense is recorded. For non-vested stock awards, compensation cost is recognized for the fair value of the stock awarded and is charged to expense over the respective vesting periods. The Company has adopted the disclosure-only provisions of SFAS No. 123 (SFAS 123), "Accounting for Stock-Based Compensation."

Pro forma information regarding net earnings and earnings per share is required by SFAS 123 and has been determined as if the Company had accounted for its employee stock options under the fair value method of that Statement. The fair value for these options was estimated at the date of grant using a Black-Scholes option pricing model with the following weighted average assumptions for 2002, 2001 and 2000:

	2002		2001			2000
Risk-free interest rate	4.59	%	5.00		%	6.02		%
Dividend yield	0.48	%	2.78		%	1.23		%
Volatility factor	1.244		0.85			0.76
Weighted average expected life	5 years			5 years			5 years

The Black-Scholes option valuation model was developed for use in estimating the fair value of traded options, which have no vesting restrictions and are fully transferable. In addition, option valuation models require the input of highly subjective assumptions, including the expected stock price volatility.  Because the Company's employee stock options have characteristics significantly different from those of traded options, and because changes in the subjective input assumptions can materially affect the fair value estimate, in management's opinion, the existing models do not necessarily provide a reliable single measure of the fair value of its employee stock options.

For purposes of pro forma disclosures, the estimated fair value of the options using the Black-Scholes option pricing model is amortized to expense over the options' vesting period. The Company's pro forma net earnings and earnings per share were as follows:

		2002			2001			2000
Net earnings (loss) - as reported	$	(61,887	)	$	(22,600	)	$	14,900
Net earnings (loss) - pro forma		(63,169	)		(24,226	)		13,208
Basic and diluted earnings (loss) per share - as reported		(2.30	)		(0.83	)		0.54
Basic and diluted earnings (loss) per share - pro forma		(2.34	)		(0.89	)		0.48
Weighted average fair value of options granted during the year		1.15			3.11			3.22

Estimates --The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Reclassification --Certain items in the 2001 and 2000 Consolidated Financial Statements have been reclassified to conform to the 2002 presentation. These reclassifications had no impact on net income or stockholders' equity as previously reported.

2.     Restructuring

In February 2002, the Company announced its plans to close the Optical Products segment's Azusa, California facility, sell the buildings and consolidate the operations into the Company's existing plants in Ramsey, Minnesota and Jakarta, Indonesia.  The total restructuring-related costs recorded were $2,800 of which $2,745 has been utilized during the year.  The following table details the restructuring charges and account balance as of December 31, 2002:

		Severance and Related Costs		Property, Plant and Equipment		Contractual Obligations and Other		Total
Charged to operations in 2002	$	426	$	1,517	$	857	$	2,800
Utilized in 2002		371		1,517		857		2,745
Restructuring liability as of December 31, 2002:	$	55	$	--	$	--	$	55

In fourth quarter 2001, the Company announced restructuring initiatives in both of its business groups. The Company will exit the computer monitor segment of the aperture mask business, will sell or consolidate into its other facilities all operations currently located in St. Paul, Minnesota, phase out of certain products and discontinue certain optical products development activities. The total restructuring related costs recorded for the year ended December 31, 2001 were $12,165. The charges include restructuring costs of $6,218 and asset write-downs and other restructuring related costs of $5,947, which are recorded as a component of cost of products sold in the Consolidated Statement of Operations.

The following table displays the activity and balances of the 2001 restructuring reserve account for the years ended December 31, 2002 and 2001:

		Restructuring Costs
		Severance and Related Costs			Contractual Obligations and Other			Total
Buckbee-Mears	$	3,309		$	1,729		$	5,038
Optical Products		295			885			1,180
Total charged to operations in 2001		3,604			2,614			6,218
Buckbee-Mears		--			--			--
Optical Products		(295	)		(885	)		(1,180	)
Total utilized in 2001		(295	)		(885	)		(1,180	)
Buckbee-Mears		3,309			1,729			5,038
Optical Products		--			--			--
Restructuring liability as of December 31, 2001	$	3,309		$	1,729		$	5,038
Utilized in 2002		(2,547	)		(242	)		(2,789	)
Change in estimate		(39	)		--			(39	)
Restructuring liability as of December 31, 2002		723			1,487			2,210

		Other Restructuring Related Costs
		Inventory Adjustments		Asset Write-downs and Other		Total
Charged to operations in 2001:
Buckbee-Mears	$	2,573	$	1,389	$	3,962
Optical Products		1,024		961		1,985
Total	$	3,597	$	2,350	$	5,947

3.     Goodwill and Other Intangible Assets

In July 2001, the FASB issued Statement of Financial Accounting Standard (SFAS) No. 142, Goodwill and Other Intangible Assets, which eliminated the systematic amortization of goodwill. The Company adopted SFAS No. 142, effective January 1, 2002 and ceased amortization of its goodwill balances. However, intangible assets with finite lives continue to be amortized over their estimated useful lives.

SFAS No. 142 required the Company to complete an impairment review of its goodwill assets. During the first quarter 2002, the Company completed its transitional impairment test using a discounted cash flow model required by SFAS No. 142 and determined that the goodwill in its Optical Products segment was impaired. As such, the Company recorded as a cumulative effect of change in accounting principle a write-off of its goodwill balance in the amount of $52,704 on which the Company recognized no tax benefit.

A reconciliation of reported net earnings (loss) adjusted to reflect the adoption of SFAS 142 as if it had been effective January 1, 2000 is provided below.

		2002			2001			2000
Reported net earnings (loss)	$	(61,887	)	$	(22,600	)	$	14,900
Add:  Adjustment for accounting change		52,704			--			--
Goodwill amortization, net of tax		--			1,217			1,286
Adjusted net earnings (loss)	$	(9,183	)	$	(21,383	)	$	16,186
Reported basic and diluted earnings (loss) per share	$	(2.30	)	$	(0.83	)	$	0.54
Add:  Adjustment for accounting change		1.96			--			--
Goodwill amortization, net of tax		--			0.04			0.05
Adjusted earnings (loss) per share	$	(0.34)		$	(0.79	)	$	0.59

The following is a summary of intangible assets at December 31:

		2002		2001
Goodwill	$	--	$	61,738
Intangible pension asset		3,332		--
Other		13,675		13,732
Total		17,007		75,470
Less accumulated amortization		4,866		13,401
Total intangible assets, net	$	12,141	$	62,069

4.     Inventories

The following is a summary of inventories at December 31:

		2002		2001
Raw materials	$	13,030	$	16,857
Work in process		6,156		7,445
Finished goods		40,550		47,332
Total inventories	$	59,736	$	71,634

5.     Property, Plant and Equipment

The following is a summary of property, plant and equipment at December 31:

		2002		2001
Land and improvements	$	6,488	$	6,279
Buildings and improvements		92,080		91,999
Machinery and equipment		172,088		175,769
Construction in progress		9,188		7,869
Total		279,844		281,916
Less accumulated depreciation and amortization		158,510		150,375
Total property, plant and equipment, net	$	121,334	$	131,541

6.     Derivative Instruments and Hedging Activities

Derivative financial instruments are used by the Company from time to time to reduce foreign exchange and interest rate risks.  All derivatives are recognized on the balance sheet at their fair value.  On the date a derivative contract is entered into the derivative is designated as a fair value hedge, cash flow hedge or a foreign-currency net investment hedge.  The Company hedges some selected foreign-currency denominated forecasted transactions (cash flow hedges), in which changes in the fair value of highly effective derivatives are recorded in Accumulated Other Comprehensive Loss.  The Company also has multiple interest rate swap agreements (cash flow hedges), which provide for the Company to swap a variable interest rate for fixed interest rates.

The Company formally documents all relations between hedging instruments and the hedged items, as well as its risk-management objectives and strategy for undertaking various hedge transactions. The Company formally assesses, both at the hedge's inception and on an ongoing basis, whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in cash flows of the hedged items.

Foreign Currency Forward-Exchange Contracts

The Company will use foreign currency forward-exchange contracts with durations of less than twelve months to hedge against the effect of exchange rate fluctuations on certain foreign currency denominated steel purchases and other expenditures, and certain U.S. dollar denominated sales in a foreign subsidiary.

As of December 31, 2002, no contracts to purchase German marks (DM) remained outstanding. At December 31, 2001, $60 of deferred net losses on derivative instruments was included in Accumulated Other Comprehensive Loss. These losses were recorded into earnings in the first quarter of 2002.

During 2000, the Company entered into forward-exchange contracts to purchase a total of 22.5 billion Indonesian rupiah to hedge certain purchases in our Vision-Ease Indonesian operations. During 2001, these contracts were terminated and the Company recognized a loss of $133, which is included in other income in the consolidated statement of operations. As of December 31, 2002 and 2001, no contracts to purchase rupiah were outstanding.

Interest Rate Swaps

At various dates during 1999 and 2000, the Company entered into multiple interest rate swap agreements to provide for the Company to swap a variable interest rate for fixed interest rates ranging from 6.7% to 7.1%.  At December 31, 2002, $50,000 of these swaps remained outstanding with the swaps expiring in May 2003 and June 2003.  The notional amount of interest rate swaps is not a measure of the Company's exposure to credit or market risks and is not included in the Consolidated Balance Sheets.  Fixing the interest rate minimizes the Company's exposure to the uncertainty of floating interest rates during this period.

Amounts to be paid or received under the interest rate swap agreement are accrued and recorded as an adjustment to Interest Expense during the term of the interest rate swap agreement.  At December 31, 2002, deferred net losses on the interest rate swap agreements in the amount of $1,154 were included in Accumulated Other Comprehensive Loss.

 
7.     Debt

The following is a summary of outstanding debt at December 31:

		2002		2001
U.S. revolving credit facility	$	6,500	$	141,000
U.S. term loans		105,000		--
German revolving credit facility		747		546
Other		39		622
Total		112,286		142,168
Less amounts due within one year		14,757		854
Total long-term debt	$	97,529	$	141,314

In September 2002, the Company amended and restated its domestic credit agreement (the Agreement) and extended the termination date of the Agreement from May 2003 to May 2004. The amendment and restatement of the Agreement reduced the aggregate commitment from $185,000 to $145,000 ($110,000 of term loans and $35,000 of revolving commitment) and converted certain previously outstanding revolving loans to term loans. This Agreement is secured by a pledge of certain shares of common stock of the Company's subsidiaries; an intercompany note from one of the Company's European holding companies; security interests in certain assets, including but not limited to, all deposit accounts, receivables, inventories, machinery and equipment and intangible assets, as well as mortgages on its real property located in Ramsey, Minnesota and Cortland, New York. The Agreement incorporates scheduled term loan amortization payments of $2,500 per quarter, which were made in the third and fourth quarters of 2002; and $3,500 per quarter payable beginning in 2003 through the termination date. The Agreement also includes a monthly borrowing base calculation, which may impact the ability of the Company to utilize its total revolving commitment. The Company's borrowing base as of December 31, 2002 was $31,307.

As of December 31, 2002, there was $111,500 of debt outstanding under the Agreement, with available credit of $22,507. Borrowings under the Agreement bear interest at a Base Rate plus a credit spread ranging from 2.25% to 4.75%, or at a Eurodollar Rate plus a credit spread ranging from 3.25% to 5.75%. This spread will increase 50 basis points, respectively, after July 1, 2003. In addition, the Company pays a commitment fee of 0.75% on undrawn funds. The Company's effective interest rate on U.S. floating-rate debt under the Agreement was 5.38% at December 31, 2002.  Under terms of the Agreement, the Company must meet certain financial covenants, including maintaining a specified consolidated net worth, a maximum leverage ratio (total debt to EBITDA), a minimum interest coverage ratio and a maximum level of capital expenditures.  The Company was in compliance with all covenants under the Agreement at December 31, 2002.

The Company's Buckbee-Mears Europe subsidiary maintains a short-term credit facility in Germany for German and Hungarian operations with total credit approximately $8,052 (7,669 Euro). This facility bears interest at a floating rate of 8.75% for overnight borrowings, or a base rate plus a credit spread based on current interbank lending rates for non-overnight borrowings. The facility is secured by land and buildings with a net book value as of December 31, 2002 of $9,098 (8,665 Euro). The lender may withdraw the credit facility at any time.  As of December 31, 2002, there was $747 (712 Euro) debt outstanding with available credit remaining of approximately $7,305 (6,957 Euro).

On December 31, 2002 and 2001, the estimated fair value of the Company's debt described above approximates the recorded amount.

Annual maturities of debt are $14,757 in 2003, $97,510 in 2004, $10 in 2005 and $9 in 2006.

There were $2,300 of outstanding domestic letters of credit and $5,905 (5,624 Euro) of outstanding foreign letters of credit at December 31, 2002.

Interest expense paid, net of amounts capitalized of $160, $200 and $410, was $10,675, $10,921 and $13,035 in 2002, 2001 and 2000, respectively.

8.     Commitments and Contingencies

The Company leases two manufacturing facilities, four sales, distribution or administrative facilities and the Company headquarters. In addition, the Company leases certain data processing and other equipment.

At December 31, 2002, the approximate future minimum rental commitments required under non-cancelable operating leases are as follows:

2003	$	2,028
2004		1,110
2005		760
2006		146
2007		39
Thereafter		585
Total minimum lease payments	$	4,668

Rent expense was $2,373, $2,987 and $2,387 in 2002, 2001 and 2000, respectively.

At December 31, 2002, the Company had no commitments related to capital projects.

The Company has entered into a long-term Product Manufacturing and Sales Agreement (the Supply Agreement) with a plastic lens manufacturer located in Southeast Asia. The Supply Agreement provides for the Southeast Asian manufacturer to supply, and the Company to purchase, certain minimum levels of plastic lenses. At December 31, 2002, the approximate future purchase commitments under this Supply Agreement were as follows:

2003	$	6,805
2004		3,179
Total	$	9,984

9.     Stock Purchase and Award Plans

The Restated and Amended 1994 Stock Incentive Plan (the 1994 Plan) provides for the granting of either incentive stock options or nonqualified stock options to purchase shares of the Company's common stock and for other stock-based awards to officers, directors and key employees responsible for the direction and management of the Company and to non-employee consultants and independent contractors.  During 2000, the Company's stockholders approved an amendment to the 1994 Plan authorizing an additional 2,000 shares of common stock for issuance.  At December 31, 2002, 4,444 shares of common stock were reserved for issuance under the 1994 Plan and for outstanding options under the 1984 Omnibus Stock Plan, which terminated on January 10, 1994.  The reserved shares included 1,426 shares available for awards under the 1994 Plan.

Information relating to stock options during 2002, 2001 and 2000 is as follows:

					Option Price
	Number of Shares			Per Share Average			Total  Price
Shares under option at December 31, 1999	2,534		$	9.75		$	24,714
2000 Activity:
Granted	450			5.29			2,379
Exercised	(3	)		5.00			(15	)
Forfeited	(212	)		9.66			(2,047	)
Shares under option at December 31, 2000	2,769			9.04			25,031
2001 Activity:
Granted	832			5.62			4,678
Exercised	(247	)		1.94			(478	)
Forfeited	(578	)		7.60			(4,393	)
Shares under option at December 31, 2001	2,776			8.95			24,838
2002 Activity:
Granted	1,014			1.33			1,348
Expired	(567	)		15.19			(8,614	)
Forfeited	(205	)		5.23			(1,072	)
Shares under option at December 31, 2002	3,018		$	5.47		$	16,500
Shares exercisable at December 31, 2002	1,471		$	7.57		$	11,129
Shares exercisable at December 31, 2001	1,584		$	10.04		$	15,911
Shares exercisable at December 31, 2000	1,591		$	8.49		$	13,502

The following table summarized information concerning currently outstanding and exercisable options:

		Options Outstanding				Options Exercisable
	Range of Exercise Prices	Number Outstanding	Weighted Average Remaining Contractual Life (Years)		Weighted Average Exercise Price	Number Exercisable		Weighted Average Exercise Price
$	0 - 5	1,313	6.7	$	2.10	366	$	3.28
	5 - 10	1,358	5.1		5.99	824		6.12
	10 - 20	241	4.8		12.60	175		13.20
	20 - 31	106	3.7		24.19	106		24.19
		3,018	5.7	$	5.47	1,471	$	7.57

All outstanding options are nonqualified options.  No compensation expense related to stock option grants was recorded in 2002, 2001 or 2000, as the option exercise prices were equal to fair market value on the date of grant.

Common Stock Issuance.  In May 2002, the Company issued 40 shares to the departing CEO and recognized $50 of compensation expense, which is included in administrative expense on the consolidated statement of operations.

Stock Option Exercise Loan Program .. During 2000, the Company discontinued the Stock Option Exercise Loan Program under which holders of exercisable stock options could obtain interest-free and interest-bearing loans from the Company to facilitate their exercise of stock options.  Under provisions of the program, new loans cannot be made, but existing loans will continue to be administered until they are repaid. Such full recourse loans are evidenced by demand promissory notes and are secured by shares of stock. The portion of such loans directly related to the option exercise price is classified as a reduction of stockholders' equity. The remainder is included in current assets.

In August 2001, 686,630 common shares at a market value of $3,361 were received from officers of the Company in exchange for the repayment of certain stock option loans and exercise of certain stock options as follows:

Receipt of common shares	$	(3,361	)
Repayment of stock option loans		2,627
Option exercise proceeds		478
Tax benefit adjustment of stock options		256
Net cash	$	--

Share Rights Plan . In June 1998, the Company adopted a Share Rights Plan and declared a dividend of one Preferred Share Purchase Right (Right) for each outstanding share of common stock to stockholders of record on July 20, 1998. The Rights will become exercisable after any person or group acquires or announces a tender or exchange offer resulting in the beneficial ownership of 15% or more of the Company's common stock. Each Right entitles shareholders to buy one five-hundredth of a share of a newly created series of preferred stock at an exercise price of $75 subject to adjustment upon certain events. If any person or group acquires 15% or more of the Company's common stock, if the Company is acquired in a business combination, or if the Company sells 50% or more of its assets, each Right entitles its holder, other than the person or group acquiring the common stock, to purchase at the Right's then current exercise price, shares of the Company's common stock having a value of twice the Right's then current exercise price. The Rights are redeemable at $0.001 per Right and will expire on July 20, 2008 unless extended or redeemed earlier by the Company.

10.    Employee Benefit Plans

The Company maintains a savings and profit sharing plan covering substantially all of its domestic salaried employees and a majority of those domestic hourly employees not covered by a pension plan or retirement fund described below. Under the profit sharing provision of the plan, the Company makes no annual minimum contribution. Depending upon the Company's profitability, a discretionary contribution up to 12% of participants' wages may be made. Provisions of the profit sharing portion of the plan include 100% vesting after five years of continuous service, and payment of benefits upon retirement, total disability, death or termination. Under terms of the savings provision of the plan, the Company makes a quarterly contribution equal to 100% of participants' before-tax contributions up to 3% of base salary with an additional contribution equal to 50% of participants' before-tax contributions between 3% and 5% of base salary.  Provisions of the savings portion of the plan include immediate vesting of the Company's contributions, and payment of benefits upon retirement, total disability, death or termination. 

The Company's German subsidiary has a noncontributory defined benefit pension plan covering substantially all of its employees.  Benefits payable under the plan are based upon the participant's base salary prior to retirement and years of credited service.  As allowed under German law, this plan is not funded.  However, under generally accepted accounting principles, the estimated future liability is accrued in the Company's Consolidated Financial Statements.  The Company also has a defined benefit pension plan under a contract with its union employees.

In addition to the defined benefit plans discussed above, the Company had two defined benefit post-retirement plans covering certain domestic employees.  One plan provided medical benefits and the other provides life insurance benefits.  During 2000, the Company terminated the medical benefits plan, resulting in a termination gain of $1,678, which is included in Other Income in the Consolidated Statement of Operations.  The life insurance plan provides term life insurance coverage to all retired full-time hourly employees at one former domestic operation.  The Company accrues the expected cost of providing benefits under the life insurance benefit plan during the years that eligible employees rendered service.  The life insurance plan is not funded and the liability under the plan is immaterial.

The above described defined benefit and post-retirement plans included the following components:

		Pension Benefits
		2002			2001
Change in Benefit Obligation:
Benefit obligation at beginning of year	$	32,673		$	13,486
Service cost		663			445
Interest cost		2,224			825
Foreign currency exchange rate changes		1,964			(521	)
Actuarial (gain) loss		846			393
Benefit payments		(1,745	)		(474	)
Administrative expenses paid		(18	)		--
Benefit obligation at end of year		36,607			14,154
Change in Fair Value of Plan Assets:
Fair value of plan assets at beginning of year		18,356			4,335
Actual return on plan assets		(1,879	)		(983	)
Employer contribution		151			261
Benefit payments		(1,532	)		(287	)
Administrative expenses paid		(18	)		--
Fair value of plan assets at end of year		15,078			3,326
Funded Status:
Funded status of the plan (underfunded)		(21,529	)		(10,828	)
Unrecognized transitional amount		3,358			34
Unrecognized net gain		5,310			1,197
Accrued pension cost	$	(12,861	)	$	(9,597	)

		2002			2001			2000
Components of Net Periodic Pension Cost
Pension benefits:
Service cost	$	663		$	445			450
Interest cost		2,224			825			802
Expected return on plan assets		(1,463	)		(268	)		(350	)
Amortization of transition obligation		169			11			12
Recognized actuarial gain		14			(7	)		(11	)
Net periodic pension cost	$	1,607		$	1,006		$	903
Post-retirement benefits:
Service costs	$	--		$	--		$	47
Interest cost		--			--			55
Recognized actuarial (gain) loss		--			--			3
Settlement/curtailment gain		--			--			(1,678	)
Net periodic pension cost	$	--		$	--		$	(1,573	)

Assumptions used in developing the projected benefit obligation and the net periodic pension cost as of December 31 were as follows:  

	2002		2001		2000
Domestic plans (including post-retirement plan in 2000):
Discount rate	6.75	%	7.50	%	7.75	%
Rate of return on plan assets	8.75	%	9.00	%	9.00	%
Foreign plan:
Discount rate	6.00	%	6.00	%	6.00	%
Rate of increase in compensation	2.60	%	2.50	%	2.50	%

At December 31, 2002, the Company was required to record a minimum pension liability under its pension plans in the amount of $7,170, net of taxes. An intangible asset for the union plan transition obligation in the amount of $3,332 was also recorded. The charge to accumulated other comprehensive income was $1,503 and 2,335 in 2002 and 2001, respectively.

The total cost of all profit sharing, savings and pension plans, domestic and foreign, was $2,698, $2,754 and $4,591 in 2002, 2001 and 2000, respectively ..

11.    Income Taxes

The provision for income taxes was based on earnings (loss) before income taxes, as follows: 

Years ended December 31		2002			2001			2000
Domestic	$	(60,281	)	$	(16,806	)	$	6,648
Foreign		(1,222	)		3,576			14,495
Earnings (loss) before income taxes	$	(61,503	)	$	(13,230	)	$	21,143

The provision for income taxes consisted of:

Years ended December 31		2002			2001			2000
Current
Federal	$	(5,705	)	$	(150	)	$	1,102
State		18			58			(15	)
Foreign		1,619			3,878			6,310
Deferred
Federal and state		4,712			6,504			(1,292	)
Foreign		(260	)		(920	)		138
Income tax expense	$	384		$	9,370		$	6,243

Significant components of deferred income tax assets and liabilities were as follows at December 31:

		2002			2001
Federal and State Net Deferred Income Taxes
Deferred tax asset
Reserves and accruals	$	4,757		$	4,642
Compensation and benefit-related accruals		5,072			5,319
Goodwill		14,623			--
Other temporary differences		4,364			4,278
NOL and tax credit carryovers		17,545			23,414
Valuation allowance		(28,853	)		(14,500	)
Total		17,508			23,153
Deferred tax liability
Goodwill		--			(3,072	)
Depreciation		(3,700	)		(2,430	)
Capitalized molds and tooling		(1,294	)		(799	)
Total		(4,994	)		(6,301	)
Net deferred tax asset	$	12,514		$	16,852
Foreign Net Deferred Income Taxes
Deferred tax liability
Depreciation	$	(1,720	)	$	(1,908	)
Inventory		(11	)		(110	)
Other temporary differences		(653	)		(565	)
Total		(2,384	)		(2,583	)
Deferred tax asset
Retirement benefits		1,093			815
Other temporary differences		109			730
Total		1,202			1,545
Net deferred tax liability		(1,182	)		(1,038	)

The federal and state net deferred tax asset included a current portion of $9,431 and $10,198 at December 31, 2002 and 2001, respectively, and a long-term portion of $3,083 and $6,654 at December 31, 2002 and 2001, respectively. The foreign net deferred tax liability included a current liability of $27 and a current asset of $52 at December 31, 2002 and 2001, respectively, and a long-term liability of  $1,155 and $1,090 at December 31, 2002 and 2001, respectively. 

Net operating loss carryforwards of $13,243 at December 31, 2002 expire in 2019. General business credit carryforwards of $932 expire in 2016 to 2022. Foreign tax credit carryforwards of $10,280 expire in 2003 through 2005. Alternative minimum tax credits of $981 can be carried forward indefinitely to offset regular tax liabilities.

The differences between income taxes at the U.S. federal statutory tax rate and the effective tax rate were as follows:

Years ended December 31	2002		2001		2000
Statutory rate	(35.0	)%	(35.0	)%	35.0	%
Difference in taxation of foreign earnings	2.8		10.7		6.1
Foreign income taxed in the U.S.	10.2		(14.9	)	(9.5	)
State income taxes, net of federal benefit	(1.6	)	(1.6	)	1.0
Change in deferred tax valuation allowance	23.3		109.6		--
Other items	0.9		2.0		(3.1	)
Effective tax rate	0.6	%	70.8	%	29.5	%

Differences in taxation of foreign earnings relate primarily to taxation of foreign earnings at rates in excess of the U.S. statutory rate.  Undistributed earnings of foreign subsidiaries at December 31, 2002 were approximately $12,619. No U.S. taxes have been provided on these undistributed earnings, because the Company expects to be able to utilize foreign tax credits to offset any U.S. tax that would result from their distribution.

The Company provided for deferred tax asset valuation reserves of $14,353 in 2002 and $14,500 in 2001, the effect of which increased income tax expense. The need for the valuation reserve was driven by projections for future U.S. taxable income, which impacts the potential for realizing the benefits of the Company's carryovers. The statutory time period for using the carryovers on its income tax returns extends beyond the period the Company used to assess impairment for accounting purposes.  If at some time in the future it is determined that all or a portion of the existing carryovers may be realized, the valuation reserve will be reduced accordingly.

Income taxes paid were $586, $612 and $7,888 in 2002, 2001 and 2000, respectively.

12.    Segment Information

The Company has two operating segments, which manufacture and sell a variety of products:  Buckbee-Mears and Optical Products.  Buckbee-Mears manufactures precision photo-etched and electroformed parts that require tight tolerances and miniaturization.  Its principal product is aperture masks, a key component used in the manufacture of color television and computer monitor picture tubes.  Optical Products designs, manufactures and distributes optical lenses.  Net sales of aperture masks comprised 93%, 93% and 91% of Buckbee-Mears segment revenues in 2002, 2001 and 2000, respectively, and 52%, 52% and 55% of the Company's consolidated total revenues in 2002, 2001 and 2000, respectively. 

The following is a summary of certain financial information relating to the two segments:

Years ended December 31		2002			2001			2000
Total Revenues by Segment
Buckbee-Mears	$	137,950		$	170,862		$	214,880
Optical Products		110,148			131,434			139,605
Total Revenues	$	248,098		$	302,296		$	354,485
Operating Income (Loss) by Segment
Buckbee-Mears
Before non-recurring charges	$	9,050		$	5,089		$	25,108
Non-recurring charges		--			(5,038	)		--
Total		9,050			51			25,108
Optical Products
Before non-recurring charges		(290	)		3,298			11,419
Non-recurring charges		(2,800	)		(1,180	)		--
Total		(3,090	)		2,118			11,419
Total segment operating profit		5,960			2,169			36,527
Administrative expense		(6,124	)		(5,038	)		(5,389	)
Interest expense, net		(10,347	)		(11,244	)		(12,833	)
Other income		1,712			883			2,838
Earnings (loss) before income taxes and cumulative effect of change in accounting principle		(8,799	)		(13,230	)		21,143
Identifiable Assets by Segment
Buckbee-Mears	$	116,966		$	132,755		$	158,453
Optical Products		109,634			180,648			191,884
Total identifiable assets		226,600			313,403			350,337
Corporate and other assets		20,759			18,343			23,467
Total assets	$	247,359		$	331,746		$	373,804
Depreciation and Amortization by Segment
Buckbee-Mears	$	11,395		$	12,191		$	13,492
Optical Products		9,349			11,516			10,336
Corporate and other		64			100			162
Total depreciation and amortization	$	20,808		$	23,807		$	23,990
Capital Expenditures by Segment
Buckbee-Mears	$	2,421		$	5,779		$	7,703
Optical Products		5,762			8,311			4,182
Corporate and other		30			44			44
Total capital expenditures	$	8,213		$	14,134		$	11,929

The following is a summary of the Company's operations in different geographic areas:

Years ended December 31		2002		2001		2000
Total Revenues from Unaffiliated Customers
United States	$	150,092	$	192,879	$	232,458
Germany		69,855		84,399		95,796
Other		28,151		25,018		26,231
Total	$	248,098	$	302,296	$	354,485
Long-Lived Assets
United States	$	89,212	$	101,482	$	107,679
Germany		18,169		18,136		21,404
Other		13,953		11,923		10,416
Total	$	121,334	$	131,541	$	139,499

The Company evaluates segment performance based on profit or loss from operations before interest, other income/expense, taxes and charges for corporate administration.  Revenues by geographic area are based upon revenues generated from each country's operations.  Net sales to unaffiliated foreign customers from domestic operations (export sales) in 2002, 2001 and 2000 were $36,101, $56,139 and $61,686, or 15%, 19% and 17%, respectively, of total revenues.  Buckbee-Mears had sales to one customer of $32,894, $42,566 and $62,895 and to another customer of $45,957, $47,502 and $58,174 in 2002, 2001 and 2000, respectively.  Optical Products did not have sales to any individual customer greater than 10% of total revenues.

13.    Concentrations of Credit Risk

Approximately 72% of the trade accounts receivable before allowances (receivables) of Buckbee-Mears at December 31, 2002 were represented by four customers.  Approximately 54% of the receivables of Optical Products at December 31, 2002 were represented by 20 customers.  These 24 customers represented approximately 64% of the Company's consolidated receivables at December 31, 2002, with one customer of Buckbee-Mears representing approximately 14% and two other customers representing approximately 13% each of consolidated receivables and one customer of Optical Products representing approximately 9% and another customer representing 8% of consolidated receivables.

Buckbee-Mears' customer base consists of the largest television manufacturers in the world.  Accordingly, Buckbee-Mears generally does not require collateral and its trade receivables are unsecured.  Optical Products' customer base consists of a wide range of eyewear retailers and optical laboratories.  Optical Products performs detailed credit evaluations of customers and establishes credit limits as necessary.  Collateral or other security for accounts receivable is obtained as considered necessary for Optical Products' customers.

14.    Legal Matters

During 2002, the Optical Products group filed a lawsuit for patent infringement against Younger Mfg. Co., which operates under the name "Younger Optics", in the United States Court for the District of Minnesota. We sought an injunction prohibiting the manufacture, use, sale or offer for sale of polycarbonate polarizing lenses that infringe patent claims held by us, as well as damages suffered as a result of Younger's infringement of our patent rights. On March 17, 2003, we settled this lawsuit and entered into a license agreement under which Younger is required to pay a royalty to Vision-Ease for all products produced within our patent claims. In addition, Vision-Ease received a royalty-free license to Younger patents covering the use of PET film in the production of optical products. Although we currently do not practice within these patents, we have the right to use this technology in future applications.

In June 2002, Riccardo Nunziati, a shareholder of BMC, filed a shareholder derivative lawsuit in Minnesota District Court for the Fourth District against BMC, Paul B. Burke, our former Chairman of the Board and CEO, and the remaining directors serving on BMC's Board at that time. Mr. Nunziati's complaint asserted breach of fiduciary duty, abuse of control and waste of corporate assets. Mr. Nunziati sought to unwind a stock transaction between BMC and Mr. Burke, as well as payment of his attorney fees and other costs of bringing the suit. In July 2002, the case was removed from the Minnesota District Court to the United States District Court for the District of Minnesota. The parties reached a settlement in August 2002. Under the terms of the settlement agreement, we agreed to review existing corporate governance policies and practices and consider enhancements to those polices where appropriate. In addition, the Board agreed to consider up to three nominees from Mr. Nunziati for potential membership on the Board of Directors.  Although Mr. Nunziati had the right to nominate three candidates for consideration by the Board, the settlement agreement provided that his nominees were required to meet the same qualifications as all other candidates and go through the same process as all other director candidates. Of the three nominees presented by Mr. Nunziati, the Board moved forward with the consideration of one candidate, Robert D. Endacott. Following an extensive review process, the Board determined that Mr. Endacott met the qualifications for service on the Board and that he would bring beneficial experience and knowledge to the Board.  Mr. Endacott accepted the Board's offer to serve as a director in October 2002.

In August 2002, the Buckbee-Mears group initiated arbitration proceedings in Stockholm, Sweden against China-based China National Electronics Import and Export Corp. ("CEIEC") and Yantai Zhenghai Electronic Shadow Mask Co., Ltd. ("Yantai") seeking monetary damages and injunctive relief for alleged violations by the CEIEC and Yantai of multiple terms of an equipment purchase and technology license agreement between CEIEC, Yantai and BMC. The Buckbee-Mears group sold a mask production line to the defendants under this agreement in 1993.  In addition to restrictions on sales of masks by Yantai outside China, the agreement requires the payment of a royalty by Yantai to BMC for all of its mask sales over a ten-year period. To date, Yantai has not made any royalty payments to BMC. In addition, Yantai has built additional mask production lines, which BMC alleges were built in violation of the agreement by copying the original production line sold to Yantai. BMC also alleges that these subsequent production lines infringe upon BMC intellectual property rights. The arbitration panel is expected to issue its findings in July 2003.

BMC is also a defendant in various other suits, claims and investigations that arise in the normal course of business. In the opinion of our management, the ultimate disposition of these matters will not have a material adverse impact on our consolidated financial position, liquidity or results of operations.

Report of Independent Auditors

The Board of Directors and Stockholders

BMC Industries, Inc.

We have audited the accompanying consolidated balance sheets of BMC Industries, Inc. as of December 31, 2002 and 2001, and the related consolidated statements of operations, stockholders' equity and cash flows for each of the three years in the period ended December 31, 2002. Our audits also included the financial statement schedule listed in Item 15. These financial statements and schedule are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of BMC Industries, Inc. at December 31, 2002 and 2001, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2002, in conformity with accounting principles generally accepted in the United States. Also in our opinion, the financial statement schedule referred to above, when considered in relation to the basic financial statements taken as a whole, presents fairly in all material aspects the information set forth therein.

As discussed in Notes 1 and 3 to the consolidated financial statements, the Company adopted Statement of Financial Accounting Standards No. 142, Goodwill and Other Intangible Assets, in 2002.

Ernst & Young LLP

Minneapolis, Minnesota

January 31, 2003

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Part III

Item 10. Directors and Executive Officers of the Registrant

(a)    Directors of the Registrant

      The information under the caption "Election of Directors" on pages 3-5 of our proxy statement for the annual meeting of stockholders to be held on May 13, 2003 is incorporated herein by reference.

(b)    Executive Officers of the Registrant

Listed below is information regarding all of our executive officers as of March 21, 2003.

Name (Age)	Date First Elected or Appointed as an Executive Officer	Title
Douglas C. Hepper (53)	June 2002	Chairman of the Board, President and Chief Executive Officer
Bradley D. Carlson (38)	September 1999	Treasurer
Jon A. Dobson (36)	December 1997	Vice President, General Counsel and Secretary
Richard G. Faber (43)	March 2002	Controller
Susan J. Linzmeier (57)	July 2002	Vice President, Human Resources
Curtis E. Petersen (50)	December 2001	Senior Vice President and Chief Financial Officer

There are no family relationships between or among any of the executive officers. Executive officers are elected by the Board of Directors and serve until their successors have been duly elected and qualified or until their resignation or removal.

Except as indicated below, the executive officers have not changed their principal occupations or employment during the past five years.

Mr. Hepper is also a director of BMC. Mr. Hepper joined BMC as Chairman, President and Chief Executive Officer in June 2002. Prior to joining BMC, Mr. Hepper has held several management positions with PPG Industries, Inc., a global manufacturer and distributor of paints and other coatings, since 1973, most recently as Vice President of PPG's automotive refinishing divisions.

Mr. Carlson joined BMC in September 1999 as Treasurer. From July 1992 to September 1999, Mr. Carlson held various positions with Northwest Airlines, Inc., a commercial air travel carrier, most recently as Director of Corporate Finance. Prior to this, Mr. Carlson served as an Associate with Kidder Peabody, Inc., an investment banking firm, in 1991, and as a Corporate Finance Analyst with Dain Rauscher Incorporated, an investment banking firm, from December 1987 to June 1990.

Mr. Dobson joined BMC in April 1995 as Director of Legal Services.  In December 1997, he was appointed General Counsel and Secretary. In November 1999, Mr. Dobson was appointed Vice President of Human Resources, General Counsel and Secretary. In November 2001, he was appointed Vice President, General Counsel and Secretary.  Prior to joining BMC, Mr. Dobson was an associate with Lindquist & Vennum PLLP, a Minneapolis law firm, practicing exclusively in corporate and securities law.

Mr. Faber jointed BMC in March 2002 as Controller. From 1998 to 2001, Mr. Faber served as Chief Financial Officer, Asia Pacific, at Carlson Companies, a travel, marketing and hospitality company. Prior to this, Mr. Faber served in a variety of controller and project leader assignments with Cargill Incorporated, a processing and trading company.

Ms. Linzmeier joined BMC in July 2002 as Vice President of Human Resources. Prior to joining the Company, Ms. Linzmeier held several positions over the last 15 years with American Standard Corporation, an air conditioning, heating, plumbing and vehicle control products manufacturing company, most recently as Corporate Director, Human Resources. 

Mr. Petersen joined BMC in August 2001 as Executive Vice President, Finance and Administration, of the Optical Products group. In December 2001, he was appointed Senior Vice President and Chief Financial Officer of BMC. Prior to joining BMC, Mr. Petersen served as Senior Vice President and Chief Financial Officer of Rivertown Trading Company, a retail catalog producer, and later of Target.Direct.Inc., an internet-based retailer, from September 1996 to March 2001. Prior to that, he served in numerous executive positions in finance, accounting and operations with Rosemount, Inc., a division of Emerson Electric Company, a process instrumentation manufacturer, and Diversified Energies, Inc., a holding company with interests in natural gas, prior to its merger into Arkla, Inc.

(c)    Compliance with Section 16(a) of the Exchange Act

      The information under the caption "Section 16(a) Beneficial Ownership Reporting Compliance" on page 23 of our proxy statement for the annual meeting of stockholders to be held on May 13, 2003 is incorporated herein by reference.

Item 11. Executive Compensation

The information contained under the caption "Executive Compensation" on pages 13-16 and 17-20, and "Election of Directors - Information About the Board and Its Committees" on pages 3-6 of our proxy statement for the annual meeting of stockholders to be held on May 13, 2003 is incorporated herein by reference.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The information contained under the caption "Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters" on pages 10-12 of our proxy statement for the annual meeting of stockholders to be held on May 13, 2003 is incorporated herein by reference.

Item 13. Certain Relationships and Related Transactions

The information contained under the caption "Certain Transactions" on page 22 of our proxy statement for the annual meeting of stockholders to be held on May 13, 2003 is incorporated herein by reference.

Item 14. Controls and Procedures

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

As of December 31, 2002, an evaluation was performed under the supervision and with the participation of management, including Douglas C. Hepper, our principal executive officer, and Curtis E. Petersen, our principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Exchange Act Rules 240.13a-14(c) and 15d-14(c)). Based on that evaluation, BMC's management, including Messrs. Hepper and Petersen, concluded that our disclosure controls and procedures were effective as of December 31, 2002.

CHANGES IN INTERNAL CONTROLS

There have been no significant changes in our internal controls or in other factors that could significantly affect internal controls subsequent to December 31, 2002.

PART IV.

Item 15. Exhibits, Financial Statement Schedules, and Reports on Form 8-K

(a)    1.     Financial Statements

            The following items are included herein on the pages indicated.

Consolidated Financial Statements:	Page
Consolidated Statements of Operations for the Years Ended
December 31, 2002, 2001 and 2000	24
Consolidated Balance Sheets as of December 31, 2002 and 2001	25
Consolidated Statements of Stockholders' Equity for the Years
Ended December 31, 2002, 2001 and 2000	26
Consolidated Statements of Cash Flows for the Years Ended
December 31, 2002, 2001 and 2000	27
Notes to Consolidated Financial Statements	28
Price Range of Common Stock	12
Report of Independent Auditors	45
Selected Quarterly Financial Data (unaudited)	14

2.     Financial Statement Schedule:

The following financial statement schedule is included herein and should be read in conjunction with the consolidated financial statements referenced above:

                                                                                                               Page

            II - Valuation and Qualifying Accounts                                                            50

Schedules other than the one listed above are omitted because of the absence of the conditions under which they are required or because the information required is included in the consolidated financial statements or the notes thereto.

      3.     Exhibits:

            Reference is made to the Exhibit Index contained on pages 54 of this Form 10-K.

The following exhibits filed as a part of this report are management contracts or compensatory plans or arrangements:

10.1	Revised Executive Perquisite/Flex Policy (effective as of January 1, 1998 and terminated as of December 31, 2002) (incorporated by reference to Exhibit 10.4 to the Company's Annual Report on Form 10-K for the year ended December 31, 1998 (File No. 1-8467)).
10.6	Restated and Amended Directors' Deferred Compensation Plan (incorporated by reference to Exhibit 10.15 to the Company's Annual Report on Form 10-K for the year ended December 31, 1996 (File No. 1-8467)).
10.27	Form of Change of Control Agreement entered into between the Company and Mr. Burke (incorporated by reference to Exhibit 10.31 to the Company's Annual Report on Form 10-K for the year ended December 31, 1991 (File No 1-8467)).
10.28	Form of Change of Control Agreement entered into between the Company and Messrs. Carlson, Dobson, Faber, Petersen and Ms. Linzmeier (incorporated by reference to Exhibit 10.29 to the Company's Annual Report on Form 10-K for the year ended December 31, 1999 (File No. 1-8467)).
10.30	Employment Agreement by and between the Company and Paul B. Burke, dated as of January 1, 1999 (incorporated by reference to Exhibit 10.25 of the Company's Annual Report on Form 10-K for the year ended December 31, 1998 (File No. 1-8467)).
10.29	Employment Agreement by and between the Company and Curtis E. Petersen, dated December 3, 2001(incorporated by reference to Exhibit 10.23 to the Company's Annual Report on Form 10-K for the year ended December 31, 2001 (File No. 1-8467)).
10.31	BMC Industries, Inc. Executive Benefit Plan, effective January 1, 1993 (incorporated by reference to Exhibit 10.22 of the Company's Annual Report on Form 10-K for the year ended December 31, 1998 (File No. 1-8467)).
10.10	First Declaration of Amendment, effective September 1, 1998, to the BMC Industries, Inc. Executive Benefit Plan (incorporated by reference to Exhibit 10.12 to the Company's Annual Report on Form 10-K for the year ended December 31, 1998 (File No. 1-8467)).
10.31	Amendment to Executive Employment Agreement between the Company and Paul B. Burke, dated April 10, 2002 (incorporated by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2002 (File NO. 1-8467)).
10.32	Employment Agreement by and between the Company and Douglas Hepper, dated as of May 14, 2002 (incorporated by reference to Exhibit 10.44 of the Company's Current Report on Form 8-K, dated June 12, 2002 and filed with the Commission on June 12, 2002 (File No. 1-8467)).

(b)    Reports on Form 8-K

The Company filed a Current Report on Form 8-K, dated October 12, 2002, that reported the completion of a Second Amendment and Restatement Agreement amending the Company's Amended and Restated Credit Agreement dated June 25, 1998.

(c)    Exhibits

The response to this portion of Item 15 is submitted as a separate section of this report.

(d)    Financial Statement Schedules

The response to this portion of Item 15 is submitted as a separate section of this report.

Schedule II

Valuation and Qualifying Accounts

Years Ended December 31

(in thousands)

	Balance Beginning of Year	Additions Charged to Costs and Expenses	Deductions	Translation Adjustment and Other	Balance End of Year
2002
Allowance for doubtful accounts	$1,496	$698	$1,454	$0	$740
Allowance for merchandise returns	872	489	121	157	1,397
Total	$2,368	$1,187	$1,576	$157	$2,137
Inventory reserves	$12,580	$766	$3,056	$702	$10,992
2001
Allowance for doubtful accounts	$1,433	$1,452	$1,389	$0	$1,496
Allowance for merchandise returns	1,430	595	677	(476)	872
Total	$2,863	$2,047	$2,066	($476)	$2,368
Inventory reserves	$10,669	$3,696	$1,567	($218)	$12,580
2000
Allowance for doubtful accounts	$1,828	$1,388	$1,783	$0	$1,433
Allowance for merchandise returns	1,546	583	483	(216)	1,430
Total	$3,374	$1,971	$2,266	($216)	$2,863
Inventory reserves	$15,317	($3,021)	$1,201	($426)	$10,669

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on March 31, 2003, on its behalf by the undersigned, thereunto duly authorized.

                                          BMC INDUSTRIES, INC.

                                          By:  /s/Douglas C. Hepper     

                                                 Douglas C. Hepper

                                                                                                                                        Chairman, President and

                                                                                                                                        Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below on March 31, 2003, by the following persons in the capacities and on the dates indicated.

           Signature                         Title

/s/Douglas C. Hepper                                  Chairman of the Board, President and Chief

Douglas C. Hepper                                       Executive Officer (Principal Executive Officer)

/s/Curtis E. Petersen                                     Senior Vice President and Chief Financial

Curtis E. Petersen                                         Officer (Principal Financial Officer)

/s/Richard G. Faber                                      Controller (Principal Accounting Officer)

Richard G. Faber

/s/John W. Castro                                         Director

John W. Castro

/s/H. Ted Davis                                           Director

H. Ted Davis

/s/Robert D. Endacott                                  Director

Robert D. Endacott

/s/Morris Goodwin, Jr.                                Director

Morris Goodwin, Jr.

/s/Harry A. Hammerly                                 Director

Harry A. Hammerly

/s/Alan R. Longstreet                                   Director

Alan R. Longstreet

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

 I, Douglas C. Hepper, certify that:

     1.  I have reviewed this annual report on Form 10-K of BMC Industries, Inc.;

     2.  Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

     3.  Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;

     4.  The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

     a) Designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;

     b) Evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this annual report (the "Evaluation Date"); and

     c) Presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

     5.  The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

     a) All significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and

     b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and

     6.  The registrant's other certifying officers and I have indicated in this annual report whether there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

Date: March 26, 2003

/s/Douglas C. Hepper        

Douglas C. Hepper

Chief Executive Officer

CERTIFICATION OF CHIEF FINANCIAL OFFICER

I, Curtis E. Petersen, certify that:

     1. I have reviewed this annual report on Form 10-K of BMC Industries, Inc.;

     2. Based on my knowledge, this annual report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this annual report;

     3. Based on my knowledge, the financial statements, and other financial information included in this annual report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this annual report;

     4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

     a) Designed such disclosure controls and procedures to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this annual report is being prepared;

     b) Evaluated the effectiveness of the registrant's disclosure controls and procedures as of a date within 90 days prior to the filing date of this annual report (the "Evaluation Date"); and

  c) Presented in this annual report our conclusions about the effectiveness of the disclosure controls and procedures based on our evaluation as of the Evaluation Date;

     5. The registrant's other certifying officers and I have disclosed, based on our most recent evaluation, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):

     a) All significant deficiencies in the design or operation of internal controls which could adversely affect the registrant's ability to record, process, summarize and report financial data and have identified for the registrant's auditors any material weaknesses in internal controls; and

     b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls; and

     6. The registrant's other certifying officers and I have indicated in this annual report whether there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

Date: March 26, 2003

/s/Curtis E. Petersen         

Curtis E. Petersen

Chief Financial Officer

BMC Industries, Inc.

Exhibit Index to Annual Report on Form 10-K

For the Year Ended December 31, 2002

Exhibit No.		Exhibit Method of Filing
3.1	Second Restated Articles of Incorporation of the Company, as amended.	Incorporated by reference to Exhibit 3.1 to the Company's Annual Report on Form 10-K for the year ended December 31, 1994 (File No. 1-8467).
3.2	Amendment to the Second Restated Articles of Incorporation, dated May 8, 1995.	Incorporated by reference to Exhibit 3.2 to the Company's Annual Report on Form 10-K for the year ended December 31, 1994 (File No. 1-8467).
3.3	Amendment to the Second Restated Articles of Incorporation, dated October 30, 1995.	Incorporated by reference to Exhibit 3.1 to the Company's quarterly report on Form 10-Q for the quarter ended September 30, 1995 (File No. 1-8467).
3.4	Amendment to the Second Restated Articles of Incorporation, dated August 7, 1998.	Incorporated by reference to Exhibit 3.4 to the Company's Annual Report on Form 10-K for the year ended December 31, 1998 (File No. 1-8467).
3.5	Articles of Correction to the Second Restated Articles of Incorporation, dated November 22, 1999.	Incorporated by reference to Exhibit 3.5 to the Company's Annual Report on Form 10-K for the year ended December 31, 1999 (File No. 1-8467).
3.6	Restated Bylaws of the Company, as amended.	Incorporated by reference to Exhibit 3.4 to the Company's Annual Report on Form 10-K for the year ended December 31, 1994 (File No. 1-8467).
3.7	Amendment to the Restated Bylaws of the Company.	Incorporated by reference to Exhibit 3.5 to the Company's Annual Report on Form 10-K for the year ended December 31, 1997 (File No. 1-8467).
3.8	Amendment to the Restated Bylaws of the Company, dated February 20, 1998.	Incorporated by reference to Exhibit 3.7 to the Company's Annual Report on Form 10-K for the year ended December 31, 1998 (File No. 1-8467) .
4.1	Specimen Form of the Company's Common Stock Certificate.	Incorporated by reference to Exhibit 4.3 to the Company's Registration Statement on Form S-2 (File No. 2-83809).
4.2	Form of Share Rights Agreement, dated as of June 30, 1998, between the Company and Norwest Bank, National Association, as Rights Agent.	Incorporated by reference to Exhibit 1 to the Company's Registration Statement on Form 8-A, dated July 14, 1998.
10.1	Revised Executive Perquisite/Flex Policy (effective as of January 1, 1998 and terminated on December 31, 2002).	Incorporated by reference to Exhibit 10.4 to the Company's Annual Report on Form 10-K for the year ended December 31, 1998 (File No. 1-8467).
10.2	BMC Industries, Inc. Savings and Profit Sharing Plan, 2001 Revision, effective January 1, 2001.	Filed electronically herewith.
10.3	First Declaration of Amendment, effective December 31, 2001, to the BMC Industries, Inc. Savings and Profit Sharing Plan, 2001 Revision.	Filed electronically herewith.
10.4	Second Declaration of Amendment, effective January 1, 2002, to the BMC Industries, Inc. Savings and Profit Sharing Plan, 2001 Revision.	Filed electronically herewith.
10.5	Third Declaration of Amendment, dated December 31, 2002, to the BMC Industries, Inc. Savings Profit Sharing Plan, 2001 Revision.	Filed electronically herewith.
10.6	Restated and Amended Directors' Deferred Compensation Plan.	Incorporated by reference to Exhibit 10.15 to the Company's Annual Report on Form 10-K for the year ended December 31, 1996 (File No. 1-8467).
10.7	Restated and Amended 1994 Stock Incentive Plan, effective May 11, 2000.	Incorporated by reference to exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2000 (File No. 1-8467).
10.8	Amendment No. 1 to the Restated and Amended 1994 Stock Incentive Plan, dated August 3, 2000.	Incorporated by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 2000 (File No. 1-8467).
10.9	BMC Industries, Inc. Executive Benefit Plan, effective January 1, 1993.	Incorporated by reference to Exhibit 10.11 to the Company's Annual Report on Form 10-K for the year ended December 31, 1998 (File No. 1-8467).
10.10	First Declaration of Amendment to the BMC Industries Executive Benefit Plan, effective September 1, 1998.	Incorporated by reference to Exhibit 10.12 to the Company's Annual Report on Form 10-K for the year ended December 31, 1998 (File No. 1-8467).
10.11	Lease Agreement, dated November 20, 1978, between Control Data Corporation and the Company.	Incorporated by reference to Exhibit 10.9 to the Company's Registration Statement on Form S-2 (File No. 2-79667).
10.12	Amendment to Lease Agreement, dated December 27, 1983, between Control Data Corporation and the Company.	Incorporated by reference to Exhibit 10.24 to the Company's Annual Report on Form 10-K for the year ended December 31, 1983 (File No. 1-8467).
10.13	Amendment to Lease Agreement, dated April 9, 1986, between Control Data Corporation and the Company.	Incorporated by reference to Exhibit 10.15 to the Company's Annual Report on Form 10-K for the year ended December 31, 1987 (File No. 1-8467).
10.14	Amendment to Lease Agreement, dated April 12, 1989, between GMT Corporation (as successor in interest to Control Data Corporation) and the Company.	Incorporated by reference to Exhibit 10.14 to the Company's Annual Report on Form 10-K for the year ended December 31, 1989 (File No. 1-8467).
10.15	Amendment to Lease Agreement, dated March 19, 1990, between GMT Corporation and the Company.	Incorporated by reference to Exhibit 10.15 to the Company's Annual Report on Form 10-K for the year ended December 31, 1989 (File No. 1-8467).
10.16	Amendment to Lease Agreement, dated May 17, 1993, between GMT Corporation and the Company.	Incorporated by reference to Exhibit 10.20 to the Company's Annual Report on Form 10-K for the year ended December 31, 1993 (File No. 1-8467).
10.17	Amendment of Lease, dated April 6, 1994 by and between GMT Corporation and the Company.	Incorporated by reference to Exhibit 10.23 to the Company's Annual Report on Form 10-K for the year ended December 31, 1994 (File No. 1-8467).
10.18	Waiver of Condition Precedent, dated July 29, 1994, by and between GMT Corporation and the Company.	Incorporated by reference to Exhibit 10.24 to the Company's Annual Report on Form 10-K for the year ended December 31, 1994 (File No. 1-8467).
10.19	Amendment of Lease, dated September 25, 1997 by and between GMT Corporation and the Company.	Incorporated by reference to Exhibit 10.34 to the Company's Annual Report on Form 10-K for the year ended December 31, 1997 (File No. 1-8467).
10.20	Amendment of Lease, dated August 1, 1998 by and between GMT Corporation and the Company.	Incorporated by reference to Exhibit 10.26 to the Company's Annual Report on Form 10-K for the year ended December 31, 1999 (File No. 1-8467).
10.21	Amendment of Lease, dated August 1, 1998 by and between GMT Corporation and the Company.	Incorporated by reference to Exhibit 10.27 to the Company's Annual Report on Form 10-K for the year ended December 31, 1999 (File No. 1-8467).
10.22	Notice of Reduction of Leased Space, dated March 8, 1999, from the Company to GMT Corporation.	Incorporated by reference to Exhibit 10.17 to the Company's Annual Report on Form 10-K for the year ended December 31, 2001 (File No. 1-8467).
10.23	Notice of Reduction of Leased Space, dated July 20, 1999, from the Company to GMT Corporation.	Incorporated by reference to Exhibit 10.18 to the Company's Annual Report on Form 10-K for the year ended December 31, 2001 (file No. 1-8467).
10.24	Notice of Reduction of Leased Space, dated June 14, 2000, from the Company to GMT Corporation.	Incorporated by reference to Exhibit 10.19 to the Company's Annual Report on Form 10-K for the year ended December 31, 2001 (File No. 1-8467).
10.25	Notice of Reduction of Leased Space, dated May 4, 2001, from the Company to GMT Corporation.	Incorporated by reference to Exhibit 10.20 to the Company's Annual Report on Form 10-K for the year ended December 31, 2001 (File No. 1-8467).
10.26	Notice of Termination of Leased PS-3 Space, dated January 14, 2003, from the Company to GMT Corporation	Filed electronically herewith.
10.27	Form of Change of Control Agreement entered into between the Company and Mr. Burke.	Incorporated by reference to Exhibit 10.31 to the Company's Annual Report on Form 10-K for the year ended December 31, 1991 (File No. 1-8467).
10.28	Form of Change of Control Agreement entered into between the Company and Messrs. Carlson, Dobson, Faber and Petersen and Ms. Linzmeier.	Incorporated by reference to Exhibit 10.29 to the Company's Annual Report on Form 10-K for the year ended December 31, 1999 (File No. 1-8467).
10.29	Employment Agreement by and between the Company and Curtis E. Petersen, dated December 3, 2001	Incorporated by reference to Exhibit 10.23 to the Company's Annual Report on Form 10-K for the year ended December 31, 2001 (File No. 1-8467).
10.30	Employment Agreement, by and between the Company and Paul B. Burke, dated as of January 1, 1999.	Incorporated by reference to Exhibit 10.25 to the Company's Annual Report on Form 10-K for the year ended December 31, 1998 (File No. 1-8467).
10.31	Amendment to Executive Employment Agreement between BMC Industries, Inc. and Paul B. Burke, dated April 10, 2002.	Incorporated by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2002 (File No. 1-8467).
10.32	Employment Agreement, dated as of May 14, 2002, between the Company and Douglas Hepper.	Incorporated by referenced to Exhibit 10.44 to the Company's Current Report on Form 8-K, dated June 12, 2002 and filed with the Commission on June 12, 2002 (File No. 1-8467).
10.33	Second Amendment and Restatement Agreement, dated as of October 12, 2001, by and among the Company, Bankers Trusty Company as Administrative Agent, Bank One, NA, as Documentation Agent and Various Lending Institutions.	Incorporated by reference to Exhibit 10.46 to the Company's Current Report on Form 8-K dated October 12, 2001 and filed with the Commission on October 24, 2001 (File No. 1-8467).
10.34	Security Agreement, dated as of October 12, 2001, between the Company, Bankers Trust Company as Administrative Agent, and U.S. Bank National Association	Incorporated by reference to Exhibit 10.47 to the Company's Current Report on Form 8-K dated October 12, 2001 and filed with the Commission on October 24, 2001 (File No. 1-8467).
10.35	Subsidiary Guarantor Security Agreement, dated as of October 12, 2001, among Vision-Ease Lens, Inc., Vision-Ease Lens Azusa, Inc., Bankers Trust Company, as Administrative Agent and U.S. Bank National Association.	Incorporated by reference to Exhibit 10.48 to the Company's Current Report on Form 8-K dated October 12, 2001 and filed with the Commission on October 24, 2001 (File No. 1-8467).
10.36	Amended and Restated Subsidiary Guarantee Agreement, dated as of October 12, 2001, made by Vision-Ease Lens, Inc. and Vision-Ease Lens Azusa, Inc.	Incorporated by reference to Exhibit 10.49 to the Company's Current Report on Form 8-K dated October 12, 2001 and filed with the Commission on October 24, 2001 (File No. 1-8467).
10.37	Second Amended and Restated Agreement, dated as of October 12, 2001, made by the Company to Bankers Trust Company, as Collateral Agent.	Incorporated by reference to Exhibit 10.50 to the Company's Current Report on Form 8-K dated October 12, 2001 and filed with the Commission on October 24, 2001 (File No. 1-8467).
10.38	Third Amended and Restated Credit Agreement, dated as of September 27, 2002, among the Company, Deutsche Bank Trust Company Americas, as Administrative Agent and Bank One, NA, as Documentation Agent and Various Lending Institutions.	Incorporated by reference to Exhibit 10.45 to the Company's Current Report on Form 8-K dated September 27, 2002 and filed with the Commission on    October 12, 2002 (File No. 1-8467).
10.39	Amended and Restated Security Agreement, dated as of September 27, 2002, between the Company, Deutsche Bank trust Company Americas, as Administrative Agent and U.S. Bank National Association.	Incorporated by reference to Exhibit 10.46 to the Company's Current Report on Form 8-K dated September 27, 2002 and filed with the Commission on October 12, 2002 (File No. 1-8467).
10.40	Amended and Restated Subsidiary Guarantor Security Agreement, dated as of September 27, 2002 between Vision-Ease Lens, Inc., Vision-Ease Lens, Azusa, Inc. Deutsche Bank Trust Company Americas, as Administrative Agent and U.S. Bank National Association.	Incorporated by reference to Exhibit 10.47 to the Company's Current Report on Form 8-K dated September 27, 2002 and filed with the Commission on October 12, 2002 (File No. 1-8467).
10.41	First Amendment to Mortgage, effective as of September 27, 2002, by and between Vision-Ease Lens, Inc. and Deutsche Bank Trust Company Americas, as Administrative Agent.	Incorporated by reference to Exhibit 10.50 to the Company's Current Report on Form 8-K dated September 27, 2002 and filed with the Commission on October 12, 2002 (File No. 1-8467).
10.42	Mortgage, Assignment of Leases and Rents, and Security Agreement, dated as of September 27, 2002, made by the Company and Cortland County Industrial Development Agency to Deutsche Bank Trust Company Americas, in its capacity as Administrative Agent under the Credit Agreement.	Incorporated by reference to Exhibit 10.51 to the Company's Current Report on Form 8-K dated September 27, 2002 and filed with the Commission on October 12, 2002 (File No. 1-8467).
10.43	Mortgage Assignment of Leases and Rents and Fixture Filing, dated as of October 12, 2001, made by Vision-Ease Lens, Inc. to Bankers Trust Company, as Administrative Agent.	Incorporated by reference to Exhibit 10.51 to the Company's Current Report on Form 8-K dated October 12, 2001 and filed with the Commission on October 24, 2001 (File No. 1-8467).
10.44	Lease, dated October 29, 1997, by and among the Company and Meridian Crossings LLC (d/b/a Told Development Company).	Incorporated by reference to Exhibit 10.3 to the Company's quarterly Report on Form 10-Q for the quarter ended September 30, 1997 (File No. 1-8467).
10.45	First Amendment to Lease, dated March 5, 2002, between OTR, an Ohio general partnership, acting as the duly authorized nominee of the Board of the State Teachers Retirement System of Ohio and the Company.	Incorporated by reference to Exhibit 10.42 to the Company's Quarterly Report on Form 10-K for the year ended December 31, 2001 (File No. 1-8467).
10.46	Commercial Lease, dated September 26, 2000, between Minnesota Logistics II, LLC and Vision-Ease Lens, Inc.	Incorporated by reference to Exhibit 10.43 to the Company's Quarterly Report on Form 10-K for the year ended December 31, 2001 (File No. 1-8467).
10.47	The Seventh Restated Graphic Communications International Union, Twin Cities Local 6a - Buckbee-Mears Pension Plan, Generally Effective January 1, 2001.	Filed electronically herewith.
10.48	Amendment One, to the Seventh Restated Graphic Communications International Union, Twin Cities Local 6a - Buckbee-Mears Pension Plan	Filed electronically herewith.
21.1	Subsidiaries of the Registrant.	Filed electronically herewith.
23.1	Consent of Ernst & Young LLP, Independent Auditors.	Filed electronically herewith.
99.1	Certification of CEO under Section 906 of the Sarbanes-Oxley Act of 2002	Filed Electronically herewith.
99.2	Certification of CFO under Section 906 of the Sarbanes-Oxley Act of 2002.	Filed Electronically herewith

EX-10.2 3 exhibit10-2.htm

BMC INDUSTRIES, INC.
SAVINGS AND PROFIT SHARING PLAN

Fifth Declaration of Amendment

Pursuant to the retained power of amendment contained in Section 11.2 of the BMC Industries, Inc. Savings and Profit Sharing Plan, the undersigned hereby amends the Plan by way of restatement in the manner set forth in the instrument entitled "BMC Industries, Inc. Savings and Profit Sharing Plan - 2001 Revision" (the "Plan") attached hereto.

Except as otherwise specifically provided in the Plan, the foregoing amendment is effective as of the Restatement Date as defined in the Plan.

Dated:  November 30, 2001.

	BMC INDUSTRIES, INC.
Attest: /s/Jon A. Dobson	By:  /s/Bradley D. Carlson
Secretary	Its:  Treasurer

ARTICLE 1.  Description and Purpose...................................................... 1

1.1.  Plan Name......................................................................................................... 1

1.2.  Plan Description............................................................................................... 1

1.3.  Plan Background.............................................................................................. 1

ARTICLE 2.  Eligibility..................................................................................... 3

2.1.  Eligibility Requirements................................................................................... 3

2.2.  Entry Date......................................................................................................... 3

2.3.  Special Entry Dates.......................................................................................... 4

2.4.  Transfer Among Participating Employers or Business Units.......................... 4

2.5.  Multiple Employment....................................................................................... 4

2.6.  Reentry.............................................................................................................. 4

2.7.  Condition of Participation............................................................................... 4

2.8.  Termination of Participation........................................................................... 4

ARTICLE 3.  Contributions............................................................................ 5

3.1.  401(k) Contributions........................................................................................ 5

3.2.  After-Tax Contributions................................................................................... 6

3.3.  Matching Contributions................................................................................... 7

3.4.  Profit Sharing Contributions........................................................................... 9

3.5.  Rollovers......................................................................................................... 11

3.6.  Corrective Contributions............................................................................... 11

ARTICLE 4.  Accounts and Valuation.................................................... 13

4.1.  Establishment of Accounts.............................................................................. 13

4.2.  Valuation and Account Adjustment................................................................ 13

4.3.  Allocations Do Not Create Rights.................................................................. 13

ARTICLE 5.  Participant Investment Direction................................ 15

5.1.  Establishment of Investment Funds................................................................ 15

5.2.  Contribution Investment Directions............................................................... 15

5.3.  Transfer Among Investment Funds................................................................. 16

5.4.  BMC Common Stock Fund.............................................................................. 16

5.5.  Investment Direction Responsibility Resides With Participants................... 17

5.6.  Beneficiaries and Alternate Payees............................................................... 17

ARTICLE 6.  Withdrawals During Employment and Loans......... 18

6.1.  Hardship Withdrawals from 401(k) Contribution Account............................ 18

6.2.  Withdrawals from 401(k) Contribution Account After Attaining Age 591/2 ... 19

6.3.  Withdrawals from After-Tax Contribution Account....................................... 20

6.4.  Withdrawals from Rollover Account.............................................................. 20

6.5.  Rules for Withdrawals.................................................................................... 20

6.6.  No Other In-Service Withdrawals.................................................................. 20

6.7.  Plan Loans...................................................................................................... 21

ARTICLE 7.  Vesting and Forfeitures..................................................... 23

7.1.  Vesting............................................................................................................ 23

7.2.  Forfeiture Upon Distribution......................................................................... 25

7.3.  Other Forfeitures............................................................................................ 25

7.4.  Application of Forfeitures.............................................................................. 26

ARTICLE 8.  Distributions After Termination................................... 27

8.1.  Form and Time of Distribution...................................................................... 27

8.2.  Beneficiary Designation................................................................................. 29

8.3.  Assignment, Alienation of Benefits................................................................. 30

8.4.  Payment in Event of Incapacity...................................................................... 30

8.5.  Payment Satisfies Claims............................................................................... 31

8.6.  Disposition if Distributee Cannot be Located............................................... 31

8.7.  Direct Rollovers and Transfers...................................................................... 31

ARTICLE 9.  Contribution Limitations................................................... 32

9.1.  401(k) Contribution Dollar Limitation.......................................................... 32

9.2.  Actual Deferral Percentage Limitations........................................................ 32

9.3.  Actual Contribution Percentage Limitations................................................. 35

9.4.  Multiple Use Limitation................................................................................. 37

9.5.  Earnings or Losses on Excess Contributions................................................. 39

9.6.  Annual Additions Limitation........................................................................... 39

9.7.  Administrator's Discretion............................................................................. 41

ARTICLE 10.  Service Rules.......................................................................... 42

10.1.  Vesting Service............................................................................................. 42

10.2.  One-Year Break in Service........................................................................... 42

10.3.  Loss of Service.............................................................................................. 42

10.4.  Pre-Acquisition Service................................................................................ 43

10.5.  Hour of Service............................................................................................. 43

ARTICLE 11.  Adoption, Amendment and Termination................... 46

11.1.  Adoption by Affiliated Organizations........................................................... 46

11.2.  Authority to Amend and Procedure.............................................................. 46

11.3.  Authority to Terminate and Procedure........................................................ 46

11.4.  Vesting Upon Termination, Partial Termination or Discontinuance of Contributions..................................................................................................... 47

11.5.  Distribution Following Termination, Partial Termination or Discontinuance of Contributions....................................................................... 47

ARTICLE 12.  PLAN ADMINISTRATION........................................................... 48

12.1.  Administrator, Named Fiduciary.................................................................. 48

12.2.  Committee..................................................................................................... 48

12.3.  Administrative Duties................................................................................... 50

12.4.  Delegation.................................................................................................... 50

12.5.  Reports and Records..................................................................................... 50

12.6.  Compensation............................................................................................... 51

12.7.  Professional Assistance................................................................................ 51

12.8.  Payment of Administrative Costs................................................................. 51

12.9.  Indemnification............................................................................................. 51

12.10.  Claims Procedure....................................................................................... 51

12.11.  Disputes...................................................................................................... 52

12.12.  Correction of Errors................................................................................... 53

12.13.  Standards for Elections, Directions and Similar Actions.......................... 53

ARTICLE 13.  Miscellaneous....................................................................... 54

13.1.  Merger, Consolidation, Transfer of Assets.................................................. 54

13.2.  Limited Reversion of Fund........................................................................... 54

13.3.  Top-Heavy Provisions.................................................................................. 54

13.4.  Qualified Military Service........................................................................... 58

13.5.  Short Plan Years........................................................................................... 60

ARTICLE 14.  Construction, Interpretations AND DEFINITIONS.. 61

14.1.  Construction and Interpretations................................................................. 61

14.2.  Definitions.  ................................................................................................. 62

ADDENDUM SPECIAL EFFECTIVE DATES  ...................................................... A-1

BMC INDUSTRIES, INC.
SAVINGS AND PROFIT SHARING PLAN

2001 Revision

BMC INDUSTRIES, INC.
SAVINGS AND PROFIT SHARING PLAN

2001 Revision

ARTICLE 1. Description and Purpose

1.1.          Plan Name.  The name of the Plan is the "BMC Industries, Inc. Savings and Profit Sharing Plan."

1.2.           Plan Description.  The Plan is a profit sharing plan providing for 401(k) Contributions pursuant to a qualified cash or deferred arrangement, After-Tax Contributions, Matching Contributions, and Profit Sharing Contributions.  The Plan is intended to qualify under Code section 401(a) and to satisfy the requirements of Code sections 401(k) and 401(m).  Although the Plan is a profit sharing plan, a Participating Employer may make contributions to the Plan even though it has no current or accumulated earnings or profits.

1.3.           Plan Background.

(a)             The Company adopted the established Plan effective as of April 1, 1979, as an employee thrift and profit sharing plan with after-tax employee contributions and employer matching contributions made from current or accumulated profits.

(b)            Effective generally as of July 1, 1984, the Plan was restated in the manner set forth in the 1984 Restatement to provide, among other things, for the investment of employer matching contributions in Company Stock.

(c)             Effective generally as of July 1, 1985, the Plan was restated in the manner set forth in the 1985 Revision for purposes of incorporating into the Plan a cash or deferred arrangement pursuant to Code section 401(k).

(d)            Effective generally as of January 1, 1987, the Plan was restated in the manner set forth in the 1987 Revision to satisfy the requirements of the Tax Reform Act of 1986.

(e)             Effective generally as of January 1, 1994, the Plan was restated in the manner set forth in the 1994 Revision to comply with changes in applicable law and make certain other miscellaneous changes.

(f)               Effective as of the close of business on August 31, 1998, the BMC Industries, Inc. Profit Sharing Plan was merged into the Plan.  To reflect the merger and changes in applicable law, including the Small Business Job Protection Act of 1996, the Uruguay Round Agreements Act of 1994 and the Uniformed Services Employment and Reemployment Rights Act of 1994, and to make other miscellaneous changes to the Plan, the Plan was restated effective generally as of September 1, 1998 and, in connection therewith, the name of the Plan was changed to the BMC Industries, Inc. Savings and Profit Sharing Plan.

(g)              The Plan was amended and restated effective as of the Restatement Date for law changes as required by the Taxpayer Relief Act of 1997, the Internal Revenue Restructuring and Reform Act of 1998 and the Community Renewal Tax Relief Act of 2000, collectively (along with changes made to the Plan in the 1998 revision) referred to as the "GUST" amendments, and to make certain other miscellaneous changes.

ARTICLE 2. Eligibility

2.1.          Eligibility Requirements.

(a)             An Employee who was a Participant in the Plan the day before the Restatement Date shall continue as a Participant in the Plan.

(b)            An Employee who is a Qualified Employee is eligible to participate in the Plan

(i)              for the purposes of making 401(k) Contributions, After-Tax Contributions and a rollover contribution pursuant to Section 3.5, on the day on which he or she first completes an Hour of Active Service; and

(ii)            for the purposes of having Matching Contributions and Profit Sharing Contributions made on his or her behalf, on the last day of the first "eligibility service period" during which he or she completes at least 1000 Hours of Service.  An Employee's "eligibility service period" is the 12-month period that starts on the day on which he or she first completes an Hour of Active Service and, if the Employee fails to complete at least 1000 Hours of Service during this period, Plan Years, beginning with the Plan Year that includes the first anniversary of the day on which he or she first completes an Hour of Active Service. 

2.2.           Entry Date.

(a)             An Employee will enter the Plan as an Active Participant for the purposes of making 401(k) Contributions, After-Tax Contributions and a rollover contribution pursuant to Section 3.5, on the day on which he or she first completes an Hour of Active Service as a Qualified Employee.

(b)            An Employee will enter the Plan as an Active Participant for the purposes of having Matching Contributions made on his or her behalf on the first day of the calendar quarter that falls on or first follows the day on which he or she satisfies the applicable eligibility requirements specified in Section 2.1(b)(ii), if he or she is a Qualified Employee on the day on which he or she would otherwise enter the Plan.

(c)             An Employee will enter the Plan as an Active Participant for the purposes of having Profit Sharing Contributions made on his or her behalf, as of the January 1 that falls on or last precedes the day on which he or she satisfies the applicable eligibility requirements specified in Section 2.1(b)(ii), if he or she is a Qualified Employee on the last day of the eligibility service period.

(d)             If an Employee described in Section 2.1(b)(ii) terminates employment before the day on which he or she would otherwise be eligible to enter the Plan for the purposes of having Matching Contributions and Profit Sharing Contributions made on his or her behalf and again becomes an Employee after that day, then:

(i)              if he or she terminated employment before satisfying the eligibility requirements specified in Section 2.1(b)(ii), he or she will be treated as a new Employee and his or her previous service will be disregarded in determining his or her new eligibility service period pursuant to Section 2.1(b)(ii); or

(ii)            if he or she terminated employment after satisfying the eligibility requirements specified in Section 2.1(b)(ii), he or she will enter the Plan as an Active Participant as of the first following day on which he or she completes an Hour of Active Service as a Qualified Employee.

(e)             If an Employee is not a Qualified Employee on the day on which he or she would otherwise enter the Plan for a particular purpose, he or she will enter the Plan as an Active Participant for that purpose on the first following day on which he or she completes an Hour of Active Service as a Qualified Employee.

2.3.           Special Entry Dates.  Notwithstanding Sections 2.1 and 2.2, in conjunction with an acquisition, the Company's Board may specify a special entry date for one or more purposes for individuals who become Qualified Employees on account of the acquisition.

2.4.           Transfer Among Participating Employers or Business Units.  A Participant who transfers from one Participating Employer or Participating Business Unit to another Participating Employer or Participating Business Unit as a Qualified Employee will participate in the Plan for the Plan Year during which the transfer occurs on the basis of his or her separate Eligible Earnings for the Plan Year from each Participating Employer or Participating Business Unit, as the case may be.

2.5.           Multiple Employment.  A Participant who is simultaneously employed as a Qualified Employee with more than one Participating Employer will participate in the Plan as a Qualified Employee of all of his or her Participating Employers on the basis of his or her separate Eligible Earnings from each Participating Employer.

2.6.          Reentry.  A Participant who ceases to be a Qualified Employee will resume active participation in the Plan on the first day on which he or she completes an Hour of Active Service as a Qualified Employee.

2.7.           Condition of Participation.  Each Qualified Employee, as a condition of participation, is bound by all of the terms and conditions of the Plan and must furnish to the Administrator such pertinent information and execute such instruments as the Administrator may require.

2.8.           Termination of Participation.  A Participant will cease to be a Participant as of the later of the date on which:

(a)              he or she ceases to be a Qualified Employee; or

(b)             all benefits, if any, to which he or she is entitled under the Plan have been forfeited or distributed.

ARTICLE 3. Contributions

3.1.           401(k) Contributions.

(a)             Subject to the limitations described in Article 9, for each Plan Year an Active Participant may elect to make 401(k) Contributions for the Plan Year in accordance with the succeeding provisions of this section.  401(k) Contributions will be paid by the Participating Employer to the Trustee as soon as administratively practicable after the date on which the Active Participant would have received the Eligible Earnings but for his or her election pursuant to this section.

(b)            A reference in this section to an election to make 401(k) Contributions means that the Participant has elected to have his or her Eligible Earnings reduced in consideration of the Participating Employer's obligation to make 401(k) Contributions in the same amount on the Participant's behalf.  Except as provided in Subsection (c), a Participant's 401(k) Contributions will be made in accordance with the rules in this subsection. 

(i)              An Active Participant may elect to make 401(k) Contributions in any one percent increment from one percent to a maximum percentage specified in Plan Rules and the elected percentage will automatically apply to the Active Participant's Eligible Earnings as adjusted from time to time.  Plan Rules may specify a maximum percentage for Active Participants who are Highly Compensated Employees that is less than the maximum percentage specified for Active Participants who are not Highly Compensated Employees.  No 401(k) Contributions will be made on behalf of a Participant with respect to a period during which he or she is not an Active Participant.  

(ii)         An Active Participant's election to commence 401(k) Contributions pursuant to clause (i) will become effective at the time and manner specified in Plan Rules after the Administrator receives a complete and accurate election. (iii)        An Active Participant may elect to change the percentage rate of his or her 401(k) Contributions.  The election will become effective at the time and manner specified in Plan Rules after the Administrator receives a complete and accurate election of such change. (iv)         401(k) Contributions for an Active Participant who makes a hardship withdrawal pursuant to Section 6.1 will be automatically suspended for the 12-month period beginning on the date of the withdrawal distribution.  Following the suspension period the Active Participant may again elect to make 401(k) Contributions in accordance with clause (iii).

(c)              Only Eligible Earnings payable after an Active Participant's complete and accurate election has been received and become effective will be reduced pursuant to the election.  If any election is not processed on a timely basis, or if, for any reason, an Active Participant's Eligible Earnings are not reduced in accordance with the Participant's election, no retroactive adjustments will be made to take into account the effect of any such delay or failure.  Plan Rules, however, may permit an Active Participant to elect to make 401(k) Contributions from his or her Eligible Earnings payable during any remaining portion of the Plan Year during which the delay or failure occurred at more than the otherwise applicable maximum percentage to adjust for the effect of the delay or failure so long as the total reductions for the Plan Year do not exceed the applicable maximum percentage or the limitations described in Article 9.

3.2.           After-Tax Contributions.

(a)              Subject to the limitations described in Article 9, an Active Participant may make After-Tax Contributions in accordance with this section.  After-Tax Contributions will be paid to the Trustee as soon as administratively practicable after the date on which the Active Participant would have received the Eligible Earnings but for his or her election pursuant to this section.

(b)             Except as provided in Subsection (c), After-Tax Contributions will be made in accordance with the rules in this subsection.

(i)              An Active Participant may elect to contribute any one percent increment of his or her Eligible Earnings from one percent to a maximum percentage specified in Plan Rules and the elected percentage will automatically apply to the Active Participant's Eligible Earnings as adjusted from time to time.  Plan Rules may specify a maximum percentage applicable to After-Tax Contributions, an aggregate maximum percentage applicable to After-Tax Contributions and 401(k) Contributions or both.  In addition, Plan Rules may specify a lower maximum percentage (which, for After-Tax Contributions, may be zero) for Active Participants who are Highly Compensated Employees.  Neither deductions from Eligible Earnings nor After-Tax Contributions will be made on behalf of a Participant with respect to a period during which he or she is not an Active Participant.

(ii)            An Active Participant's election to have After-Tax Contributions commence will become effective at the time and manner specified in Plan Rules after the date on which the Administrator receives a complete and accurate election.

(iii)          An Active Participant may elect to change the percentage rate of his or her After-Tax Contributions.  The election will become effective at the time and manner specified in Plan Rules after the Administrator receives a complete and accurate election of such change.

(iv)          After-Tax Contributions by an Active Participant who makes a hardship withdrawal under Section 6.1 will be automatically suspended for the 12-month period beginning on the date of the withdrawal distribution.  Following the suspension period, the Active Participant may again elect to have After-Tax Contributions commence in accordance with clause (ii).

(c)              Elections pursuant to this section and After-Tax Contributions must be made in accordance with and are subject to Plan Rules.  Only Eligible Earnings payable after an Active Participant's complete and accurate election has been received and become effective will be subject to deduction pursuant to the election.  If any election is not processed on a timely basis, or if, for any reason, an Active Participant's After-Tax Contributions are not made in accordance with the Participant's election, no retroactive adjustments will be made to take into account the effect of any such delay or failure.  Plan Rules, however, may permit an Active Participant to make After-Tax Contributions during any remaining portion of the Plan Year during which the delay or failure occurred at more than the otherwise applicable maximum percentage to adjust for the effect of the delay or failure so long as the After-Tax Contributions for the Plan Year do not exceed the applicable maximum percentage or the limitations described in Article 9.

3.3.           Matching Contributions. 

(a)             Subject to Subsection (d) and the limitations described in Article 9, the Participating Employer of an eligible Active Participant will make a Matching Contribution on behalf of the Active Participant for a calendar quarter in an amount, if any, equal to 25 percent of the lesser of (i) the Participant's 401(k) Contributions for the calendar quarter and (ii) six percent of the Participant's Eligible Earnings for the calendar quarter.  To be eligible to share in the Participating Employer's Matching Contribution for a given calendar quarter, a Participant must have, on or before the last day of the calendar quarter, entered the Plan as a Participant for the purposes of having Matching Contributions made on his or her behalf, received Eligible Earnings for the calendar quarter from the Participating Employer and is a Participant who either:

(i)               is a Qualified Employee who is either on active status or paid leave of absence on the last day of the calendar quarter or

(ii)             terminated employment during the calendar quarter

(1)            at or after his or her Normal Retirement Date

(2)            on account of his or her death

(3)            on account of his or her becoming Disabled or

(4)            following his or her attainment of age 60 if the sum of his or her age and years of Vesting Service equals or exceeds 65;

provided, that this condition will be applied only with respect to a Participant, such sole application being made for the calendar quarter during which this clause (ii) first applies and the condition under clause (i) is not satisfied.

(b)            Subject to Subsection (d) and the limitations described in Article 9, the Participating Employer of an eligible Active Participant will make a Matching Contribution on behalf of the Active Participant for a Plan Year in an amount, if any, equal to a percentage, determined by the Participating Employer's Board, of the lesser of (i) the Participant's 401(k) Contributions for the Plan Year and (ii) six percent of the Participant's Eligible Earnings for the Plan Year; provided that the percentage may be different for eligible Active Participants employed in different Participating Business Units of the Participating Employer based on annual profit performance of each Participating Business Unit, as determined by the Participating Employer's Board.  To be eligible to share in the Participating Employer's Matching Contribution for a given Plan Year, a Participant must have, on or before the last day of the Plan Year, entered the Plan as a Participant for the purposes of having Matching Contributions made on his or her behalf, received Eligible Earnings for the Plan Year from the Participating Employer and is a Participant who:

(i)              is a Qualified Employee who is either on active status or paid leave of absence on the last day of the Plan Year or

(ii)            terminated employment during the Plan Year

(1)            at or after his or her Normal Retirement Date

(2)            on account of his or her death

(3)            on account of his or her becoming Disabled or

(4)            following his or her attainment of age 60 if the sum of his or her age and years of Vesting Service equals or exceeds 65;

provided, that this condition will be applied only with respect to a Participant, such sole application being made for the Plan Year during which this clause (ii) first applies and the condition under clause (i) is not satisfied.

(c)              A Participating Employer's Matching Contributions for a Plan Year will be paid to the Trustee on such date or dates during or following such Plan Year as the Participating Employer may elect but in no case more than 12 months after the end of the Plan Year. 

(d)             No Matching Contribution will be made with respect to any portion of a Participant's 401(k) Contributions returned to the Participant pursuant to Article 9.  For this purpose, 401(k) Contributions with respect to which no Matching Contributions are made for a Plan Year will be deemed to be the first such contributions returned to the Participant.  If the Administrator determines that Matching Contributions that have been added to a Participant's Account should not have been added by reason of this subsection, the contributions, increased by Fund earnings or decreased by Fund losses attributable to the contributions, as determined under Section 9.5, will be subtracted from the Account as soon as administratively practicable after the determination is made and will be applied to satisfy the contribution obligations of the Participating Employer that made the excess contributions for the Plan Year for which the excess contributions were made.  If, because of the passage of time, the excess cannot be applied in this way, the excess will be allocated, in the discretion of the Administrator:

(i)              among the Matching Contribution Accounts of all Participants who made 401(k) Contributions for the Plan Year as Qualified Employees of the Participating Employer in proportion to such 401(k) Contributions up to six percent of Eligible Earnings; or

(ii)            as a corrective contribution pursuant to Section 3.6.

3.4.          Profit Sharing Contributions.

(a)             Each Participating Employer will make a Profit Sharing Contribution for a Plan Year on behalf of Participants who have satisfied the eligibility conditions specified in Subsection (b) for a Plan Year in an amount equal to the sum of:

(i)              three percent of the aggregate Eligible Earnings for the Plan Year of all Participants eligible to share in the contribution for the Plan Year plus

(ii)            an additional amount, if any, separately determined by the Participating Employer's Board for each of its Participating Business Units based on the annual profit performance of each Participating Business Unit.

(b)            To be eligible to share in the Participating Employer's Profit Sharing Contribution, for a particular Plan Year, a Participant must have, on or before the last day of the Plan Year, entered the Plan as a Participant for the purposes of having Profit Sharing Contributions made on his or her behalf, received Eligible Earnings for the Plan Year from the Participating Employer and either:

(i)              completed at least 1000 Hours of Service during the Plan Year and been employed with an Affiliated Organization as a Qualified Employee who is either on active status or paid leave of absence on the last day of the Plan Year or

(ii)            terminated employment during the Plan Year

(1)            at or after his or her Normal Retirement Date

(2)            on account of his or her death

(3)            on account of his or her becoming Disabled or

(4)            following his or her attainment of age 60 if the sum of his or her age and years of Vesting Service equals or exceeds 65;

provided, that this condition will be applied only with respect to a Participant, such sole application being made for the Plan Year during which this clause (ii) first applies and the condition under clause (i) is not satisfied.

(c)             Subject to the limitations described in Article 9, a Participating Employer's Profit Sharing Contribution for a Plan Year will be allocated among the Profit Sharing Contribution Accounts of Participants who have satisfied the eligibility conditions under Subsection (b) for the Plan Year as follows:

(i)              The Participating Employer's contribution described in Subsection (a)(i) will be allocated to each eligible Participant in the same proportion that his or her Eligible Earnings for the Plan Year bears to the aggregate Eligible Earnings for the Plan Year of all Participants eligible to share in the Participating Employer's contribution.

(ii)            The Participating Employer's contribution described in Subsection (a)(ii) with respect to a given Participating Business Unit will be allocated to each eligible Participant who received Eligible Earnings for the Plan Year with respect to services for the Participating Business Unit (other than administrative services with respect to which he or she is included in the Corporate Participating Business Unit unless the contribution relates to the Corporate Participating Business Unit) as follows:

(1)            An amount equal to three percent of his or her Excess Eligible Earnings for the Plan Year.  If, however, the contribution is less than three percent of the aggregate Excess Eligible Earnings of all Participants eligible to share in the contribution with respect to the Participating Business Unit, the contribution will be allocated to each such eligible Participant in the same proportion that his or her Excess Eligible Earnings for the Plan Year bears to the aggregate Excess Eligible Earnings for the Plan Year of all Participants eligible to share in the contribution with respect to the Participating Business Unit.

(2)            To the extent the contribution is not exhausted after it has been allocated under clause (1), each eligible Participant's share of the remainder will be an amount equal to two and seven-tenths percent of the sum of his or her Eligible Earnings plus his or her Excess Eligible Earnings for the Plan Year.  If, however, the contribution is less than two and seven-tenths percent of the sum of the aggregate Eligible Earnings plus the aggregate Excess Eligible Earnings of all Participants eligible to share in the contribution with respect to the Participating Business Unit, the contribution will be allocated to each such eligible Participant in the same proportion that the sum of his or her Eligible Earnings plus his or her Excess Eligible Earnings for the Plan Year bears to the sum of the aggregate Eligible  Earnings plus the aggregate Excess Eligible Earnings for the Plan Year of all such eligible Participants.

(3)            To the extent the contribution is not exhausted after it has been allocated pursuant to clauses (1) and (2), the balance, if any, will be allocated to each Participant eligible to share in the contribution with respect to the Participating Business Unit in the same proportion that his or her Eligible Earnings for the Plan Year bears to the aggregate Eligible Earnings for the Plan Year of all such eligible Participants.

(d)            A Participating Employer's Profit Sharing Contribution for a Plan Year, if any, will be paid to the Trustee on such date or dates during or following such Plan Year as the Participating Employer may elect but in no case more than 12 months after the end of the Plan Year.

3.5.           Rollovers.

(a)              With the prior consent of the Administrator, an Active Participant may contribute to the Trust, in a direct rollover pursuant to Code section 401(a)(31) or within 60 days of receipt:

(i)              an amount paid or distributed out of an individual retirement account to which the only contributions have been one or more Eligible Rollover Distributions; or

(ii)            an Eligible Rollover Distribution from such a qualified plan.

(b)             Any contribution to the Trust pursuant to this section must be made in cash and will be added to the Participant's Rollover Account.

3.6.           Corrective Contributions.

(a)              For any Plan Year, a Participating Employer may, but is not required to, contribute to the Matching Contribution Accounts or Profit Sharing Contribution Accounts, or both, of Active Participants who are not Highly Compensated Employees, or any group of such Participants identified by the Administrator, such amounts as the Participating Employer deems advisable to assist the Plan in satisfying the requirements of Section 9.2, 9.3 or 9.4, or any other requirement under the Code or Treasury Regulations, for the Plan Year. (b)             Contributions pursuant to this section will be allocated in accordance with one or more of the following clauses, as determined by the Administrator.

(i)               Contributions are allocated among the Matching Contribution Accounts of the Participants eligible to share in the allocation who made 401(k) Contributions for the Plan Year in proportion to such 401(k) Contributions up to six percent of the Participant's Eligible Earnings for the Plan Year.

 (ii)             Contributions are allocated among the Profit Sharing Contribution Accounts of the Participants eligible to share in the allocation in proportion to their respective Eligible Earnings from the Participating Employer for the Plan Year.

(iii)          Contributions are allocated among the Matching Contribution Accounts of Participants eligible to share in the allocation who made 401(k) Contributions for the Plan Year or allocated among the Profit Sharing Contribution Accounts of the Participants eligible to share in the allocation for the Plan Year, or both, by starting with the eligible Participant with the lowest Eligible Earnings for the Plan Year and allocating to that Participant up to the maximum amount permitted by Section 9.6 and continuing successively with the eligible Participant(s) with the next lowest Eligible Earnings for the Plan Year until the amount to be allocated pursuant to this clause (ii) has been fully allocated.

(iv)          Contributions are allocated among the Matching Contribution Accounts of the Participants eligible to share in the allocation who made 401(k) Contributions for the Plan Year or allocated among the Profit Sharing Contribution Accounts of the Participants eligible to share in the allocation for the Plan Year, or both, on a per capita basis.

Contributions pursuant to this section which are used to satisfy the requirements of Section 9.2 will be added to a separate subaccount with respect to which gains, losses, withdrawals and other credits or charges are separately allocated on a reasonable and consistent basis pursuant to Section 4.2.

ARTICLE 4. Accounts and Valuation

4.1.          Establishment of Accounts.

(a)              For each Participant, the following Accounts will be established and maintained:

(i)              A 401(k) Contribution Account, to which there will be added any 401(k) Contributions made on the Participant's behalf;

(ii)            An After-Tax Contribution Account, which will include the balance of his or her supplemental contribution account and employee basic contribution account under prior provisions of the Plan and to which there will be added any After-Tax Contributions made by the Participant; (iii)          A Matching Contribution Account, which will include the balance of his or her employer contribution account under prior provisions of the Plan and to which there will be added any Matching Contributions made on the Participant's behalf;

(iv)          A Profit Sharing Contribution Account, which will include the balance of his or her profit sharing account under the BMC Industries, Inc. Profit Sharing Plan and to which there will be added any Profit Sharing Contributions made on the Participant's behalf;

(v)            A Rollover Account, to which there will be added any rollover contribution made by the Participant pursuant to Section 3.5; and

(vi)          A Profit Sharing Plan Rollover Account, which will consist solely of the balance of his or her rollover account under the BMC Industries, Inc. Profit Sharing Plan.

(b)            One or more additional accounts or subaccounts may be established and maintained for any Participant or group of similarly situated Participants in connection with the merger of another plan into the Plan, in which case provisions of the Plan applicable solely to such accounts will be set forth on an exhibit to the Plan in accordance with Section 14.1(f).

4.2.           Valuation and Account Adjustment.  At such intervals as specified in Plan Rules, but at least annually, each Participant's Accounts within each investment fund established pursuant to Section 5.1 will be adjusted, in a manner determined by the Administrator to be uniform and equitable with respect to the Accounts being adjusted at the time in question, for income, expense, gains and losses of the investment fund, as well as contributions, withdrawals, loans, loan repayments, loan offsets, distributions and other activity, since the last prior adjustment. 4.3.           Allocations Do Not Create Rights.  The fact that allocations are made and credited to the Accounts of a Participant does not vest in the Participant any right, title or interest in or to any portion of the Fund except at the time or times and upon the terms and conditions expressly set forth in the Plan.  Notwithstanding any allocation or addition to the Account of any Participant, the issuance of any statement to the Participant or a Beneficiary of a deceased Participant or the distribution of all or a portion of any Account balance, the Administrator may direct the Account to be adjusted to the extent necessary to correct any error in the Account, whether caused by misapplication of any provision of the Plan or otherwise, and may recover from the Participant or Beneficiary the amount of any excess distribution.

ARTICLE 5. Participant Investment Direction

5.1.          Establishment of Investment Funds.

(a)              In order to allow each Participant to determine the manner in which his or her Accounts will be invested, the Trustee will maintain, within the Trust, three or more separate investment funds of such nature and possessing such characteristics as the Committee may specify from time to time.  Each Participant's Accounts will be invested in the investment funds in the proportions directed by the Participant in accordance with the procedures set forth in Sections 5.2 and 5.3.  The Committee may, from time to time, direct the Trustee to establish additional investment funds or to terminate any existing investment fund.

(b)            In addition to the investment funds maintained pursuant to Subsection (a), the Trustee will maintain, within the Trust, the BMC Common Stock Fund, which will be invested in shares of Company Stock except for such amounts of cash as the Committee determines to be necessary to satisfy short-term liquidity requirements and cash held pending acquisition of shares of Company Stock.

(c)              Notwithstanding any other provision of the Plan to the contrary, the Committee may direct the Trustee to suspend Participant investment activity (including such activity in connection with the withdrawals, loans and distributions) in any or all investment funds, or impose special rules or restrictions of uniform application, for a period determined by the Committee to be necessary in connection with:

(i)              the establishment or termination of any investment fund;

(ii)            the receipt by the Trustee from, or transfer by the Trustee to, another trust of account balances in connection with an acquisition or divestiture or otherwise;

(iii)          a change of Trustee, investment manager or recordkeeper; or

(iv)          such other circumstances determined by the Committee as making such suspension or special rules or restrictions necessary or appropriate.

5.2.          Contribution Investment Directions.

(a)              In conjunction with his or her enrollment in the Plan, a Participant must direct the manner in which contributions to his or her Accounts will be invested among the investment funds maintained pursuant to Section 5.1.  Such a direction must be made in accordance with and is subject to Plan Rules.  To the extent a Participant fails to direct Account investments, the Accounts will be invested in the manner specified in Plan Rules.  

(b)             A Participant may direct a change in the manner in which future contributions credited to his or her Accounts will be invested among the investment funds maintained pursuant to Section 5.1.  Such a direction must be made in accordance with and is subject to Plan Rules and will become effective at the time and manner specified in Plan Rules and in accordance with rules and procedures of the investment fund after the Trustee receives a complete and accurate direction.

(c)              Plan Rules will include procedures pursuant to which Participants are provided with the opportunity to obtain written confirmation of investment directions made pursuant to this section.

5.3.          Transfer Among Investment Funds.

(a)              A Participant may direct the transfer of his or her Accounts among the investment funds maintained pursuant to Section 5.1.  Such a direction must be made in accordance with and is subject to Plan Rules and will become effective at the time and manner specified in Plan Rules and in accordance with rules and procedures of the investment fund after the Trustee receives a complete and accurate direction.  

(b)             Plan Rules will include procedures pursuant to which Participants are provided with the opportunity to obtain written confirmation of investment directions made pursuant to this section.

(c)              Plan Rules may limit and restrict transfers into and out of specific investment funds.

5.4.          BMC Common Stock Fund.

(a)             Subject to Subsection (b), all amounts credited to a Participant's Matching Contribution Account will be invested only in the BMC Common Stock Fund and no amounts credited to any of a Participant's other Accounts may be invested in the BMC Common Stock Fund.

(b)             Notwithstanding Subsection (a) -

(i)              Not more than once each calendar quarter, a Participant who has attained age 55 may elect to transfer all or any portion of his or her Matching Contribution Account from the BMC Common Stock Fund to one or more of the investment funds maintained pursuant to Section 5.1 other than the BMC Common Stock Fund.  The election must be made in accordance with and is subject to Plan Rules and will be effective as soon as administratively practicable after it is received by the Administrator or the Administrator's designate.  All Matching Contributions credited to the Participant's Matching Contribution Account after the effective date of the direction will continue to be invested pursuant to Subsection (a).

(ii)            Not more than once each calendar quarter, a Participant who is an Employee and is not eligible to make directions pursuant to Subsection (b)(i) may elect to transfer up to 25 percent of his or her Matching Contribution Account from the BMC Common Stock Fund to one or more of the investment funds maintained pursuant to Section 5.1 other than the BMC Common Stock Fund.  A Participant may only make an election pursuant to this Subsection (b)(ii) if the portion of the  Participant's Matching Contribution Account invested in the BMC Common Stock Fund equals or exceeds 20 percent of the aggregate balance of the Participant's 401(k) Contribution Account, Matching Contribution Account, After-Tax Contribution Account and Rollover Account.  The election must be made in accordance with and is subject to Plan Rules and will be effective as soon as administratively practicable after it is received by the Administrator or the Administrator's designate.  All Matching Contributions credited to the Participant's Matching Contribution Account after the effective date of such direction will continue to be invested pursuant to Subsection (a).

5.5.           Investment Direction Responsibility Resides With Participants.  The Plan is intended to constitute a plan described in ERISA section 404(c).  Accordingly, neither the Administrator, the Committee, the Trustee nor the Participating Employers have any authority, discretion, responsibility or liability with respect to a Participant's selection of the investment funds in which his or her Accounts will be invested, the entire authority, discretion and responsibility for, and any results attributable to, the selection being that of the Participant. 5.6.           Beneficiaries and Alternate Payees.  Solely for purposes of this article, the term "Participant" includes the Beneficiary of a deceased Participant and an alternate payee under a qualified domestic relations order within the meaning of Code section 414(p) unless otherwise provided in such order, but only after:

(a)              the Administrator has determined the identity of the Beneficiary and the amount of the Account balance to which he or she is entitled in the case of a Beneficiary of a deceased Participant; or (b)             the Administrator has, in accordance with Plan Rules, made a final determination that the order is a qualified domestic relations order and all rights to contest such determination in a court of competent jurisdiction within the time prescribed by Plan Rules have expired or been exhausted in the case of an alternate payee.

ARTICLE 6. Withdrawals During Employment and Loans

6.1.          Hardship Withdrawals from 401(k) Contribution Account.

(a)              Subject to the provisions of Section 6.5, a Participant who is an Employee may make a hardship withdrawal from his or her 401(k) Contribution Account in accordance with this section.  A hardship withdrawal will be permitted only if the Administrator determines that the withdrawal is made on account of an immediate and heavy financial need of the Participant and is necessary to satisfy such financial need.  (b)             A withdrawal will be deemed to be made on account of an immediate and heavy financial need only if it is determined by the Administrator to be on account of:

(i)              expenses for medical care, described in Code section 213(d), incurred or to be incurred by the Participant, the Participant's spouse or the Participant's dependent (as defined in Code section 152 that are not otherwise reimbursable);

(ii)            costs directly related to the purchase (excluding mortgage payments) of a principal residence of the Participant;

(iii)          payment of tuition, related educational fees and room and board expenses for the next 12 months of post-secondary education for the Participant or his or her spouse, child or other dependent (as defined in Code section 152);

(iv)          payments necessary to prevent the eviction of the Participant from his or her principal residence or foreclosure on the mortgage on the Participant's principal residence;

(v)            expenses incurred or to be incurred by the Participant that are directly related to the partial or total destruction of a principal residence of the Participant through an act of God that are not otherwise reimbursable;

(vi)          expenses incurred or to be incurred by the Participant that are directly related to and the principal purpose of which is the legal adoption of a child by the Participant that are not otherwise reimbursable; or

(vii)        loss of income due to layoff of the Participant or his or her spouse.

(c)              A withdrawal will be deemed to be necessary to satisfy the immediate and heavy financial need of the Participant only if the Administrator determines that each of the requirements in this subsection is satisfied.

(i)              The withdrawal is not more than the sum of the amount of the immediate and heavy financial need of the Participant plus an amount to pay any federal, state or local taxes or penalties that the Participant will incur in connection with the withdrawal or to satisfy withholding obligations in connection with that withdrawal, in either case as determined by the Administrator in accordance with Plan Rules.

(ii)            The Participant has received all withdrawals and has taken all nontaxable loans available under the Plan and all other qualified plans maintained by any Affiliated Organization.

(iii)          All 401(k) Contributions and After-Tax Contributions and all elective deferrals and after-tax employee contributions by or on behalf of the Participant under any other qualified or nonqualified plan of deferred compensation maintained by any Affiliated Organization are suspended for a period of 12 months following the date of the withdrawal. (iv)          For the Participant's taxable year following the taxable year during which he or she received the withdrawal, the amount of elective deferrals under all qualified plans maintained by any Affiliated Organization (including 401(k) Contributions pursuant to the Plan) that may be made on the Participant's behalf under Code section 402(g) is reduced by the amount of such elective deferrals made on the Participant's behalf for the taxable year during which he or she received the withdrawal.

(d)             The Administrator's determination of the existence of a Participant's financial hardship and the amount that may be withdrawn to satisfy the need created by such hardship will be made in accordance with Treasury Regulations, and is final and binding on the Participant. The Administrator may require the Participant to make representations and certifications concerning his or her entitlement to a withdrawal pursuant to this section and is entitled to rely on such representations and certifications unless the Administrator has actual knowledge to the contrary.  The Administrator is not obligated to supervise or otherwise verify that amounts withdrawn are applied in the manner specified in the Participant's withdrawal application. (e)              The amount of any withdrawal pursuant to this section may not exceed the amount of 401(k) Contributions made by the Participant.

6.2.           Withdrawals from 401(k) Contribution Account After Attaining Age 591/2 .  Subject to the provisions of Section 6.5, a Participant who (a) is an Employee, (b) has attained age 591/2 and (c) has received all withdrawals available pursuant to Sections 6.3 and 6.4, may withdraw all or any part of the balance of his or her 401(k) Contribution Account. 6.3.           Withdrawals from After-Tax Contribution Account.

(a)              Subject to Section 6.5, a Participant who is an Employee may withdraw all or any part of the balance of his or her After-Tax Contribution Account. (b)             All After-Tax Contributions and all Fund earnings or losses with respect thereto will be treated as a separate contract under the Plan and such contributions and earnings or losses will be separately accounted for in accordance with the Code.  Insofar as the Plan permitted Participants to make in-service withdrawals from their After-Tax Accounts on May 5, 1986, all withdrawals pursuant to this Section will be deemed to be made first from the Participant's investment in the contract as of December 31, 1986 (reduced by withdrawal distributions made from the After-Tax Contribution Account after December 31, 1986 and prior to the distribution in question that were not included in the Participant's gross income). 

6.4.           Withdrawals from Rollover Account.  Subject to the provisions of Section 6.5, a Participant who (a) is an Employee and (b) has received all withdrawals available pursuant to Section 6.3, may withdraw all or any part of the balance of his or her Rollover Account.

6.5.           Rules for Withdrawals.

(a)              Applications for withdrawals must be made in accordance with and are subject to Plan Rules.

(b)             A withdrawal will be made as soon as administratively practicable after the Administrator's determination that the Participant is entitled to receive the withdrawal distribution.

(c)              A withdrawal will be made on a pro rata basis from the investment fund or funds in which the Account from which the distribution is made is invested.

(d)             All withdrawals will be made in the form of a single sum payment made by a check drawn on the Trust.

(e)             A Participant may not withdraw the portion of his or her Accounts consisting of a note evidencing the unpaid balance of any loan made pursuant to the Plan.

(f)               The provisions of Section 8.7(a) apply to any withdrawal that constitutes an Eligible Rollover Distribution.

6.6.           No Other In-Service Withdrawals.  Except as otherwise expressly provided in the Plan, a Participant may not make withdrawals from his or her Matching Contribution Account, Profit Sharing Contribution Account or Profit Sharing Plan Rollover Account prior to his or her Termination of Employment.

6.7.           Plan Loans.

(a)              Each Participant or Beneficiary of a deceased Participant who (i) is an Employee or is otherwise a "party in interest" within the meaning of ERISA, and (ii) has received all withdrawals available pursuant to Section 6.3, may borrow funds from the vested balance of his or her 401(k) Contribution, Matching Contribution Account and Rollover Account, by submitting to the Administrator a complete and accurate loan application, in accordance with and subject to Plan Rules, subject to the succeeding provisions of this section.

(i)              The amount of the loan may not cause the aggregate amount of outstanding loans to the borrower from the Plan to exceed the least of:

(1)            $50,000, reduced by the excess (if any) of (A) the highest outstanding balance of all loans to the borrower from the Plan and all other qualified plans maintained by any Affiliated Organization during the 12-month period ending on the day before the date of the loan over (B) the outstanding balance of such loans on the date of the loan; and

(2)            50 percent of the aggregate vested balance of the borrower's 401(k) Contribution Account, Matching Contribution Account and Rollover Account as of the date on which the loan is made.

(ii)            The maturity date for any loan may not exceed five years from the date of the note, unless the Administrator determines at the time the loan is made that the proceeds of the loan will be used to purchase a house, townhome, apartment, condominium or mobile home used, or intended to be used within a reasonable time after the loan is made, as the borrower's principal residence, in which case the maturity date may not exceed ten years from the date of the note. 

(iii)          No loan will be made from the portion of a borrower's Matching Contribution Account invested in the BMC Common Stock Fund.  If a Participant's Matching Contribution Account is not fully vested, the portion of the Account that is not invested in the BMC Common Stock Fund will be allocated ratably among the vested and nonvested portions of the Account.

(iv)          Loans will be charged against the vested portion of a borrower's Accounts in the following order:  Rollover Account; 401(k) Contribution Account; and Matching Contribution Account.  No loan will be charged against any Account until the funds available to be borrowed in any prior Account have been exhausted.  A loan application fee, if any, charged by the Trustee or another third party will be charged against the Participant's Accounts in the same order.

(v)            The loan proceeds and any loan application fee will be obtained from the investment fund or funds in which the borrower's Accounts are then invested on a pro rata basis, except that no proceeds will be obtained from the portion of a borrower's Matching Contribution Account invested in the BMC Common Stock Fund.

(vi)          The promissory note evidencing a loan must provide for payments of principal and interest in equal installments of such frequency, not less frequently than quarterly, in such minimum amounts and for such maximum period as Plan Rules prescribe.

(b)             Each loan will be a loan by the Trust, but for Trust accounting purposes the loan will be deemed made from the borrower's Accounts against which the loan is charged, and the note executed by the borrower will be deemed to be an asset of those Accounts.  When a loan is made, the borrower's Accounts and any investment fund from which the loan proceeds are obtained will be reduced by an amount equal to the principal balance of the loan and a loan account will be established for the borrower with an initial balance equal to the principal amount of the loan.  The loan account will be excluded for purposes of determining and allocating the net earnings (or losses) of the Trust pursuant to Section 4.2.  A borrower's loan payments will be credited to the Accounts from which the loan proceeds were obtained on a pro rata basis.  The loan account will be reduced by the amount of any principal payment on the loan.  Repayments of loan principal and payments of interest will be invested as soon as administratively practicable following receipt by the Trustee in accordance with the borrower's most recent investment directions with respect to new contributions or in the absence of such a direction, in accordance with Plan Rules. (c)              Plan Rules may specify other terms and conditions as may be necessary or desirable for the administration of loans under this section.

ARTICLE 7. Vesting and Forfeitures

7.1.          Vesting.

(a)              A Participant always has a fully vested nonforfeitable interest in his or her 401(k) Contribution Account, After-Tax Contribution Account, Rollover Account, and Profit Sharing Plan Rollover Account, in the portion of his or her Matching Contribution Account attributable to his or her employer contribution account under prior provisions of the Plan and in the portion of his or her Matching Contribution Account or Profit Sharing Contribution Account credited to a subaccount described in Section 3.6.

(b)             A Participant will acquire a fully vested nonforfeitable interest in the portion of his or her Matching Contribution Account and Profit Sharing Contribution Account not described in Subsection (a) upon attaining his or her Normal Retirement Date while he or she is, or before he or she became, an Employee.

(c)              A Participant will acquire a fully vested nonforfeitable interest in the portion of his or her Matching Contribution Account and Profit Sharing Contribution Account not described in Subsection (a) if he or she dies or becomes Disabled while he or she is an Employee.

(d)            A Participant will acquire a fully vested nonforfeitable interest in the portion of his or her Profit Sharing Account not described in Subsection (a) upon the Participant's Termination of Employment following the Participant's attainment of age 60 if the sum of his or her age and full years of Vesting Service is at least 65.

(e)             A Participant will acquire a fully vested nonforfeitable interest in the portions of his or her Matching Contribution Account and Profit Sharing Contribution Account not described in Subsection (a) if the Affiliated Organization, Participating Business Unit, business unit, location or division at which the Participant is employed, permanently ceases operations or is sold or otherwise transferred through sale of stock or of business and assets, in such manner that it no longer is, or is no longer owned by, an Affiliated Organization.

(f)              A Participant will acquire a fully vested nonforfeitable interest in the portions of his or her Matching Contribution Account and Profit Sharing Contribution Account not described in Subsection (a) upon a Change in Control with respect to the Company, which for purposes of this subsection means any of the following:

(i)              The sale, lease, exchange, or other transfer of all or substantially all of the assets of the Company, in one transaction or in a series of related transactions, to any Person;

(ii)            The approval by the stock holders of the Company of any plan or proposal for the liquidation or dissolution of the Company;

(iii)          Any Person is or becomes the "beneficial owner" (as defined in Rule 13d-3 under the Securities and Exchange Act of 1934, as amended (the "Exchange Act")), directly or indirectly, of 50 percent or more of the combined voting power of the Company's outstanding securities ordinarily having the right to vote at elections of directors;

(iv)          Individuals who constitute the Company's Board of Directors on January 1, 1998 (the "Incumbent Board") cease for any reason to constitute at least a majority thereof, provided that any person becoming a director subsequent to January 1, 1998 whose election, or nomination for election, by the Company's stockholders, was approved by a vote of at least a majority of the directors comprising the Incumbent Board (either by a specific vote or by approval of the proxy statement of the Company in which such person is named as a nominee for director, without objection to such nomination) will, for purposes of this clause (iv), be deemed to be a member of the Incumbent Board; or

(v)            A change in control of a nature that is determined by independent legal counsel to the Company to be required to be reported (assuming such event has not been "previously reported") in response to Item 1(a) of the Current Report on Form 8-K, as in effect on January 1, 1994, pursuant to section 13 or 15(d) of the Exchange Act, whether or not the Company is then subject to such reporting requirement.

For purpose of applying the foregoing, the term "Person" means and includes any individual, corporation, partnership, group, association or other "person," as such term is used in section 14(d) of the Exchange Act, other than the Company, a wholly-owned subsidiary of the Company or any employee benefit plan(s) sponsored by the Company or a wholly-owned subsidiary of the Company.

(g)              A Participant whose Matching Contribution Account is not otherwise fully vested will acquire a vested nonforfeitable interest in the portion of his or her Matching Contribution Account not described in Subsection (a) to the extent provided in the following schedule:

Full Years of Vesting Service Less Than One Year
One Year        
Two Years     
Three Years   
Four or More Years Vested
Interest

  0  %
 25%
 50%
 75%
100%

(h)             A Participant whose Profit Sharing Contribution Account is not otherwise fully vested will acquire a vested nonforfeitable interest in the portion of his or her Profit Sharing Contribution Account not described in Subsection (a) to the extent provided in the following schedule:

Full Years of Vesting Service Less than Five Years
Five or More Years Vested
Interest

  0  %
100%

 

7.2.           Forfeiture Upon Distribution.

(a)              If a Participant receives a distribution of the entire vested balance of his or her Accounts after Termination of Employment and before he or she incurs five consecutive One-Year Breaks in Service, the nonvested portions of the Participant's Matching Contribution Account and Profit Sharing Contribution Account will, at the time of such distribution, be forfeited.  A Participant who has no vested interest in his or her Matching Contribution Account and Profit Sharing Contribution Account when he or she terminates employment will be deemed to have received a distribution of the entire vested balance of the Accounts at the time of his or her Termination of Employment.

(b)             If a Participant described in Subsection (a) received a distribution of less than the entire balance of his or her Accounts, resumes employment as a Qualified Employee and repays to the Trustee the full amount distributed, other than the portion of the distribution attributable to his or her After-Tax Contribution Account, Rollover Account and Profit Sharing Plan Rollover Account balances, before the earlier of (1) five years following the date of reemployment as a Qualified Employee or (2) the date on which he or she incurs five consecutive One-Year Breaks in Service following the distribution, then, the amount of any forfeitures will be restored to the Participant's Matching Contribution Account and Profit Sharing Contribution Account, unadjusted for interest or any change in value occurring after the distribution.  Such restoration will be made from forfeitures that arise for the Plan Year for which such restoration is to be made.  To the extent such forfeitures are insufficient for such purpose, the Participating Employer with whom the Participant was last employed as a Qualified Employee will contribute the amount required to restore the Accounts.  A Participant described in the last sentence of Subsection (a) who is reemployed before incurring five consecutive One-Year Breaks in Service following the date of his or her Termination of Employment will be deemed to have repaid his or her deemed distribution upon his or her reemployment as a Qualified Employee.

7.3.           Other Forfeitures.

(a)              Except as provided in Section 7.2, the nonvested portions of a Participant's Matching Contribution Account and Profit Sharing Contribution Account will continue to be held in separate subaccounts of such Accounts until the Participant incurs five consecutive One-Year Breaks in Service, at which time the subaccount balances will be forfeited.  If the Participant resumes employment with an Affiliated Organization prior to incurring five consecutive One-Year Breaks in Service, such subaccounts will be disregarded and their balances will be included in the Matching Contribution Account and Profit Sharing Contribution Account.

(b)             A Participant's vested interest in his or her Matching Contribution Account and Profit Sharing Contribution Account balances following a resumption of employment in accordance with Subsection (a) at any given time will not be less than the amount "X" determined by the formula: X = P(AB + (R x D)) - (R x D), where P is the Participant's vested percentage at the time of determination; AB is the Account balance at the time of determination; D is the amount of the distribution; and R is the ratio of the Account balance at the time of determination, to the subaccount balance immediately following the distribution.

7.4.           Application of Forfeitures.  All forfeitures occurring in a Plan Year will be allocated to an account, invested in accordance with Plan Rules and applied as follows:

(a)              Such forfeitures will first be applied to restore the Accounts of Participants as provided in Sections 7.2(b) and 8.6; and

(b)             Any remaining forfeitures will be applied toward the amount of future contributions by the Participating Employers for the Plan Year in which the forfeiture occurs.

ARTICLE 8. Distributions After Termination

8.1.          Form and Time of Distribution.

(a)              Following a Participant's Termination of Employment, the Trustee will distribute to the Participant or, if the Participant has died, to his or her Beneficiary, the value of the Participant's vested interest in his or her Accounts.  Subject to the remaining subsections of this section and Section 8.7, distributions will be made in accordance with the following provisions.

(i)              If the aggregate balance of the Participant's vested interest in his or her Accounts is not more than $5,000, distribution to the Participant, or to the Participant's Beneficiary in the case of the Participant's death, will be made, in the form of a lump sum payment, as soon as administratively practicable following the Participant's Termination of Employment. 

(ii)            Except as provided in clause (i), distribution to the Participant will be made in the form of a lump sum payment.  The distribution will be made as soon as administratively practicable after the Administrator receives the Participant's properly completed distribution request, but in no case later than the sixtieth day after the Plan Year during which the Participant terminates employment or attains age 65, whichever is later, unless the Participant elects to defer the distribution pursuant to Subsection (b). 

(iii)          Notwithstanding any other provision of the Plan to the contrary, any Participant who is entitled to receive a distribution of his or her Accounts with an annuity starting date that is before March 1, 2002 may elect to receive the distribution in any optional form of benefit available under the Plan as of the date immediately preceding December 1, 2001.  For purposes of this clause, the term "annuity starting date" means:  (1) for an annuity, the first day of the first period for which an amount is payable as an annuity; or (2) for a distribution option other than an annuity, the first day on which all events have occurred which entitle the participant to the benefit.

(iv)          Except as provided in clause (i), distribution to the Participant's Beneficiary following the Participant's death will be made at the time elected by the Beneficiary in accordance with Subsection (c). 

(v)            All distributions will be made in the form of a check drawn on the Trust and, if applicable, a canceled note evidencing any Plan loan; provided, that if the vested portion of the Matching Contribution Account balance of a Participant or Beneficiary of a deceased Participant is credited with the equivalent of at least 10 full shares of Company Stock, at the election of the Participant or Beneficiary, distribution of the vested portion of the Matching Contribution Account balance invested in the BMC Common Stock Fund may be distributed in full shares of Company Stock and cash in lieu of any fractional share.

(vi)          If a contribution is allocated to a Participant's Account following the Participant's Termination of Employment and after his or her vested Account balance has been distributed, as soon as administratively practicable after the allocation is made, the vested balance of the Account will be distributed to the Participant, or to the Participant's Beneficiary in the case of the Participant's death, in the form of a lump sum payment.

(b)             Subject to the provisions of the other subsections of this Section 8.1, a Participant described in Subsection (a)(ii) may elect to defer commencement of his or her distribution under the Plan by providing the Administrator with a written, signed statement specifying the date on which the payment is to be made; provided that the specified date may not be later than April 1 of the calendar year following the calendar year during which the Participant attains age 701/2.  The statement must be provided to the Administrator not later than the thirtieth day (or such later date as Plan Rules may allow) after the Plan Year during which the Participant terminates employment or attains age 65, whichever is later.  Plan Rules may permit a Participant to modify the election in any manner determined by the Administrator to be consistent with Code section 401(a)(14) and the other provisions of this section.

(c)             Subject to Subsection (a)(i), if a Participant dies before receiving the full amount to which he or she is entitled, the amount remaining will be distributed to the Participant's Beneficiary in a lump sum payment no later than December 31 of the calendar year which contains the fifth anniversary of the date of the Participant's death, at such time or times as the Beneficiary elects on a form provided by the Administrator.

If the Participant's spouse is the Beneficiary and dies after the Participant's death but before distributions to the spouse have commenced, the foregoing rules will be applied as if the surviving spouse were the Participant, including the substitution of the surviving spouse's date of death for the Participant's date of death.

(d)            Notwithstanding Subsection (a), distribution to any Participant who attains age 70-1/2 before January 1, 1999, and distribution to any Participant who is a "5-percent owner," within the meaning of the Code section 416, must begin not later than April 1 of the calendar year after the Participant attains age 70-1/2, whether or not the Participant has terminated employment, as if he or she had terminated employment on the last day of the Plan Year during which he or she attained age 70-1/2.  A Participant who attained age 70-1/2 before January 1, 1999, is not a 5-percent owner and is an Employee on September 1, 1998 may elect to stop distributions or to defer commencement of distributions, as the case may be.  The election must be made in accordance with and is subject to Plan Rules, must be received by the Administrator not later than a date specified in Plan Rules, and will become effective as soon as administratively practicable after it is received by the Administrator.  The election is irrevocable after it is received by the Administrator.  If distributions to a Participant are stopped pursuant to this subsection, the Participant will have a new annuity starting date and his or her benefit will recommence in accordance with the other subsections of this Section 8.1 following his or her subsequent termination of employment.

(e)              Notwithstanding any other provision of the Plan to the contrary, distributions will be made in accordance with regulations issued under Code section 401(a)(9), including Treasury Regulation section 1.401(a)(9)-2, and any provisions of the Plan reflecting Code section 401(a)(9) take precedence over any distribution options in the Plan that are inconsistent with Code section 401(a)(9).

(f)              With respect to distributions under the Plan made in calendar years beginning on and after January 1, 2002, the Plan will apply the minimum distribution requirements of Code section 401(a)(9) in accordance with the regulations under Code section 401(a)(9) that were proposed in January 2001, notwithstanding any provision of the Plan to the contrary. 

8.2.           Beneficiary Designation.

(a)              Each Participant may designate, on a form provided by the Administrator, one or more primary Beneficiaries or alternative Beneficiaries for all or a specified fractional part of his or her aggregate Accounts and may change or revoke any such designation from time to time.  No such designation, change or revocation is effective unless executed by the Participant and received by the Administrator during the Participant's lifetime.  Subject to Subsection (d), no such change or revocation requires the consent of any person.

(b)             If a Participant

(i)              fails to designate a Beneficiary, or

(ii)            revokes a Beneficiary designation without naming another Beneficiary, or

(iii)          designates one or more Beneficiaries none of whom survives the Participant,

for all or any portion of the Accounts, such Accounts or portion are payable to the first class of the following classes of automatic Beneficiaries that includes a member surviving the Participant:

Participant's spouse;
Participant's issue, per stirpes and not per capita;
Representative of Participant's estate.

(c)              When used in this section and, unless the designation otherwise specifies, when used in a Beneficiary designation, the term "per stirpes" means in equal shares among living children and the issue (taken collectively) of each deceased child, with such issue taking by right of representation; "children" means issue of the first generation; and "issue" means all persons who are descended from the person referred to, either by legitimate birth or legal adoption.  The automatic Beneficiaries specified above and, unless the designation otherwise specifies, the Beneficiaries designated by the Participant, become fixed as of the Participant's death so that, if a Beneficiary survives the Participant but dies before the receipt of all payments due such Beneficiary, any remaining payments are payable to the representative of such Beneficiary's estate.  Any designation of a Beneficiary by name that is accompanied by a description of relationship or only by statement of relationship to the Participant is effective only to designate the person or persons standing in such relationship to the Participant at the Participant's death.

(d)             Notwithstanding Subsection (a), no designation of a Beneficiary other than the Participant's spouse is effective unless such spouse consents to the designation.  Any such consent is effective only with respect to the Beneficiary or class of Beneficiaries so designated and only with respect to the spouse who so consented.

8.3.           Assignment, Alienation of Benefits.

(a)              Except as required under a qualified domestic relations order or by the terms of any loan from the Trust or to comply with a federal tax levy pursuant to Code section 6331, and except as otherwise provided in Code section 401(a)(13)(C),

                (i) no benefit under the Plan may in any manner be anticipated, alienated, sold, transferred, assigned, pledged, encumbered or charged, and any attempt to do so is void and

                (ii) no benefit under the Plan is in any manner liable for or subject to the debts, contracts, liabilities, engagements or torts of the person entitled to such benefit.

(b)             To the extent provided in a qualified domestic relations order, distribution of benefits assigned to an alternate payee by such order may be distributed to the alternate payee in the form of a lump sum payment prior to the Participant's earliest retirement age.  The terms "qualified domestic relations order," "alternate payee" and "earliest retirement age" have the meanings given in Code section 414(p).

8.4.           Payment in Event of Incapacity.  If any person entitled to receive any payment under the Plan is physically, mentally or legally incapable of receiving or acknowledging receipt of the payment, and no legal representative has been appointed for such person, the Administrator in its discretion may (but is not required to) cause any sum otherwise payable to such person to be paidto any one or more of the following as may be chosen by the Administrator: the Beneficiaries, if any, designated by such person; the institution maintaining such person; a custodian for such person under the Uniform Transfers to Minors Act of any state; or such person's spouse, children, parents or other relatives by blood or marriage.  Any such payment completely discharges all liabilityunder the Plan to the person with respect to whom the payment is made to the extent of the payment.

8.5.           Payment Satisfies Claims.  Any payment to or for the benefit of any Participant, or Beneficiary in accordance with the provisions of the Plan, to the extent of such payment, fully satisfies of all claims against the Trustee, the Administrator and the Participating Employers, any of whom may require the payee to execute a receipted release as a condition precedent to such payment.

8.6.           Disposition if Distributee Cannot be Located.  If the Administrator is unable to locate a Participant or Beneficiary to whom a distribution is due, the amount that would otherwise be distributed to the Participant or Beneficiary will be forfeited, and the forfeited amount will be applied in accordance with Section 7.4.  The forfeited amount will be restored to the Accounts from which the amount was forfeited, unadjusted for interest or any change in value occurring after the forfeiture, upon the Participant's or Beneficiary's claim for the benefit.  The restoration will be made through funds available pursuant to Section 7.4(a).  To the extent such funds are insufficient for such purpose, the Participating Employer with whom the Participant was last employed will contribute the amount required to restore the Accounts.

8.7.           Direct Rollovers and Transfers.

(a)              To the extent a distribution is an Eligible Rollover Distribution, the Administrator will, if so instructed by the distributee in accordance with Plan Rules, direct the Trustee to make the distribution to an "eligible retirement plan," within the meaning of Code section 402(c)(8).  Unless otherwise provided in Plan Rules, the foregoing provision will not apply (i) if the aggregate taxable distributions to be made to the distributee during the calendar year are less than $200, (ii) if less than the entire taxable amount of the distribution is to be distributed to the eligible retirement plan and the amount to be distributed to the eligible retirement plan is less than $500 or (iii) with respect to any portion of an Eligible Rollover Distribution that consists of an offset amount with respect to a Plan loan.

(b)             The Administrator may direct the Trustee to transfer the balance of any or all of the Accounts of a Participant to the trustee of another plan if:

(i)              the other plan is a defined contribution plan qualified under Code section 401(a);

(ii)            the other plan satisfies the requirements set forth in Code sections 401(k) and 411(d)(6) with respect to the transferred Accounts to which such requirements are applicable; and

(iii)          the trustee of the other plan is willing to accept such transfer.

ARTICLE 9. Contribution Limitations

9.1.           401(k) Contribution Dollar Limitation.

(a)              The aggregate amount of 401(k) Contributions and other "elective deferrals" (within the meaning of Code section 402(g)(3)) under any other qualified plan maintained by an Affiliated Organization with respect to a Participant for any taxable year of the Participant may not exceed the limitation in effect for the taxable year under Code section 402(g).  The limitation for any Participant who received a hardship distribution under Section 6.1 will, for the year following the year in which such distribution was made, be reduced as provided in Section 6.1(c)(iv).  If the limitation is exceeded for any taxable year of the Participant, the portion of the excess specified by the Company, increased by Fund earnings or decreased by Fund losses attributable to the excess as determined under Section 9.5, will be distributed to the Participant. 

(b)             The amount distributed pursuant to this section to a Participant who has made elective deferrals for the taxable year other than pursuant to the Plan or another qualified plan maintained by an Affiliated Organization will, to the extent of such other elective deferrals, be determined in accordance with written allocation instructions received by the Administrator from the Participant not later than March 1 of the following the taxable year.

(c)             A distribution pursuant to this section may be made at any time after the excess contributions are received, but not later than April 15 of the taxable year following the taxable year to which the limitation relates. 

9.2.           Actual Deferral Percentage Limitations.

(a)              For each Plan Year, the Plan must satisfy the requirements of Code section 401(k)(3). 

(i)              The Plan will satisfy the requirements of Code section 401(k)(3) for a Plan Year if, for that Plan Year, the Plan satisfies the requirements of Code section 410(b)(1) with respect to "eligible employees" and either of the following tests:

(1)            the "actual deferral percentage" for the Plan Year for eligible employees who are Highly Compensated Employees for the Plan Year is not more than the product of the actual deferral percentage for the precedingPlan Year for all eligible employees who are not Highly Compensated Employees for the preceding Plan Year, multiplied by one and one-quarter; or

 (2)            the excess of the actual deferral percentage for the Plan Year for eligible employees who are Highly Compensated Employees for the Plan Year over the actual deferral percentage for the preceding Plan Year for all eligible employees who are not Highly Compensated Employees for the preceding Plan Year is not more than two percentage points and the actual deferral percentage for the Plan Year for eligible employees who are Highly Compensated Employees for the Plan Year is not more than the product of the actual deferral percentage for the preceding Plan Year of all eligible employees who are not Highly Compensated Employees for the preceding Plan Year, multiplied by two;  provided, that for the initial Plan Year, the actual deferral percentage for eligible employees who are not Highly Compensated Employees is their actual deferral percentage for the initial Plan Year.

(ii)            For purposes of this section and Section 9.4:

(1)            "eligible employee" means an Active Participant who is eligible to make 401(k) Contributions for the Plan Year in question or would be eligible but for a suspension imposed under Section 3.1(b)(iv); and

(2)            "actual deferral percentage," with respect to either of the two groups of eligible employees referenced above, is the average of the ratios, calculated separately for each eligible employee in the particular group, of the amount of 401(k) Contributions made by the eligible employee for the Plan Year in question, to the eligible employee's Testing Wages for the Plan Year in question, or the portion of such Plan Year during which he or she was an eligible employee, as specified in Plan Rules.  In computing the actual deferral percentage, the following rules apply:

(A)           Any 401(k) Contributions made by an eligible employee who is not a Highly Compensated Employee that are in excess of the limitation described in Section 9.1 will be excluded;

(B)           Any 401(k) Contributions made by an eligible employee that are distributed to the eligible employee pursuant to Section 9.6(c) will be excluded;

(C)           Except as otherwise provided in Treasury Regulations, 401(k) Contributions taken into account in determining the actual contribution percentage under Section 9.3(a)(ii) will be excluded;

(D)           To the extent permitted by Treasury Regulations and determined by the Administrator, all or any portion of any other contribution to the Plan or any other qualified plan maintained by an Affiliated Organization will be included;

(E)            Elective contributions under any other plan that is aggregated with this Plan to satisfy the requirements of Code section 410(b) will be included; and

(F)            To the extent provided in Treasury Regulations, elective contributions made under any other qualified cash or deferred arrangement of any Affiliated Organization on behalf of any eligible Employee who is a Highly Compensated Employee will be included.

(b)             To the extent deemed advisable by the Administrator to comply with Code section 401(k)(3), the Administrator may, in accordance with Plan Rules, prospectively decrease a Participant's 401(k) Contributions. 

(c)             If, for any Plan Year, the requirements of Subsection (a) are not satisfied, the Administrator will determine the amount by which 401(k) Contributions made by each Highly Compensated Employee for the Plan Year exceeds the permissible amount as determined under Subsection (a).  The determination will be made by successively decreasing the rate of 401(k) Contributions by the Highly Compensated Employees who, during the Plan Year, had the greatest percentage of 401(k) Contributions to the next lower percentage, then again decreasing the percentage of such Highly Compensated Employees' 401(k) Contributions, together with the percentage of 401(k) Contributions by such Highly Compensated Employees who were already at such lower percentage, to the next lower percentage, and continuing such procedure for as many percentage decreases as the Administrator deems necessary.  The Administrator may make such reductions in any amount.

(d)             The amount of excess 401(k) Contributions determined in accordance with Subsection (c), increased by Fund earnings or decreased by Fund losses attributable to such excess as determined under Section 9.5, will be distributed to affected Highly Compensated Employees, at such time as the Administrator specifies on or following the last day of the Plan Year for which the determination is made, but in no case later than the last day of the following Plan Year.  The amount to be distributed with respect to any Plan Year will be reduced by the portion of the amount, if any, distributed pursuant to Section 9.1 that is attributable to 401(k) Contributions that relate to such Plan Year, determined by assuming that 401(k) Contributions in excess of the limitation described in Section 9.1 for a given taxable year are the first contributions made for a Plan Year falling within such taxable year.  Additional amounts to be distributed to Highly Compensated Employees will be determined by successively decreasing the amount of 401(k) Contributions for Highly Compensated Employees who, for the Plan Year, had the largest amount of 401(k) Contributions made on their behalf to the next lower amount, and continuing this procedure until an amount equal to the aggregate amount of excess 401(k) Contributions has been removed from the Accounts of the Highly Compensated Employees.

(e)              To the extent required or permitted by Treasury Regulations, the Administrator will or may, as the case may be, apply the limitation described in this section separately to each group of eligible employees who are included in a unit of Employees covered by a collective bargaining agreement.

(f)               If the Administrator elects to apply Code section 410(b)(4)(B) in determining whether the Plan satisfies either of the tests described in Section 9.2(a)(i) for a Plan Year, all eligible employees who have not met either the minimum age and/or minimum service requirements of Code section 410(a)(1)(A) will be considered separately in accordance with the tests described in Section 9.2(a)(i).

9.3.           Actual Contribution Percentage Limitations.

(a)              For each Plan Year, the Plan must satisfy the requirements of Code section 401(m)(2).

(i)              The Plan will satisfy the requirements of Code section 401(m)(2) for a Plan Year if, for that Plan Year, the Plan satisfies either of the following tests:

(1)            the "actual contribution percentage" for the Plan Year for "eligible employees" who are Highly Compensated Employees for the Plan Year is not more than the product of the actual contribution percentage for the preceding Plan Year for all eligible employees who are not Highly Compensated Employees for the preceding Plan Year, multiplied by one and one-quarter; or

(2)            the excess of the actual contribution percentage for the Plan Year for eligible employees who are  Highly Compensated Employees for the Plan Year over the actual contribution percentage for the preceding Plan Year for all eligible employees who are not Highly Compensated Employees for the preceding Plan Year is not more than two percentage points and the actual contribution percentage for the Plan Year for Highly Compensated Employees for the Plan Year is not more than the product of the actual contribution percentage for the preceding Plan Year for all eligible employees who are not Highly Compensated Employees for the preceding Plan Year, multiplied by two; provided, that for the initial Plan Year, the actual contribution percentage for eligible employees who are not Highly Compensated Employees is their actual contribution percentage for the initial Plan Year.

(ii)            For purposes of this section and Section 9.4:

(1)            "eligible employee" means an Active Participant who is eligible to make After-Tax Contributions, or to have Matching Contributions made on his or her behalf for the Plan Year in question or who would be eligible but for a suspension imposed under Section 3.1(b)(iv) or Section 3.2(b)(iv); and

(2)            the "actual contribution percentage" with respect to either of the two groups of eligible employees referenced above, is the average of the ratios, calculated separately for each eligible employee in the particular group, of the aggregate amount of After-Tax Contributions made by, andMatching Contributions made on behalf of, the eligible employee for the Plan Year, to the eligible employee's Testing Wages for the Plan Year, or the portion of the Plan Year during which he or she was an eligible employee, as specified in Plan Rules.  In computing the actual contribution percentage the following rules apply:

(A)           Except as otherwise provided in Treasury Regulations, Matching Contributions taken into account in determining the actual deferral percentage under Section 9.2(a)(ii) will be excluded; 

(B)           Matching Contributions taken into account for purposes of the minimum contribution required by Section 13.3(a) will be excluded;

(C)           Any Matching Contributions forfeited pursuant to Section 9.6(c) will be excluded;

(D)           To the extent permitted by Treasury Regulations and determined by the Administrator, all or any portion of the 401(k) Contributions made by eligible employees for the Plan Year will be included;

(E)            To the extent permitted by Treasury Regulations and determined by the Administrator, all or any portion of any other contributions to any other qualified plan maintained by an Affiliated Organization will be included;

(F)            Matching contributions (within the meaning of Code section 401(m)(4)(A)) and after-tax contributions made under any other plan that is aggregated with this Plan to satisfy the requirements of Code section 410(b) will be included; and

(G)           To the extent required by Treasury Regulations, matching contributions (within the meaning of Code section 401(m)(4)(A)) and after-tax contributions made under any other qualified plan of any Affiliated Organization on behalf of or by any eligible employee who is a Highly Compensated Employee will be included.

(b)             If, for any Plan Year, the requirements of Subsection (a) are not satisfied, the Administrator will determine the amount by which After-Tax Contributions made by each Highly Compensated Employee for the Plan Year and, if necessary, Matching Contributions made on behalf of each Highly Compensated Employee for the Plan Year exceeds the permissible amount as determined under Subsection (a), such determination being made in accordance with the procedure described in Section 9.2(c) with respect to reductions of 401(k) Contributions. 

(c)              The amount of excess After-Tax Contributions and Matching Contributions determined in accordance with Subsection (b), increased by Fund earnings or decreased by Fund losses attributable to such excess as determined under Section 9.5, will be distributed to affected Highly Compensated Employees at such time as the Administrator specifies on or following the last day of the Plan Year for which the determination is made, but in no case later than the last day of the following Plan Year; provided, however, that to the extent the excess Matching Contributions would not be fully vested if retained in the Plan, such excess will be forfeited rather than distributed, and any such forfeitures will be applied as provided in Section 3.3(d).  Amounts to be distributed to Highly Compensated Employees or forfeited will be determined by successively decreasing the amount of After-Tax Contributions made by, and, if necessary, Matching Contributions made on behalf of Highly Compensated Employees who, for the Plan Year, made the largest After-Tax Contributions and had the largest amount of Matching Contributions made on their behalf to the next lower amount, and continuing this procedure until an amount equal to the aggregate amount of excess contributions has been removed from the Accounts of the Highly Compensated Employees.

(d)             To the extent provided in Treasury Regulations, the limitations described in this section do not apply to any group of eligible employees who are included in a unit of Employees covered by a collective bargaining agreement.

(e)              If the Administrator elects to apply Code section 410(b)(4)(B) in determining whether the Plan satisfies either of the tests described in Section 9.3(a)(i) for any Plan Year, all eligible employees who have not met either the minimum age and/or minimum service requirements of Code section 410(a)(1)(A) will be considered separately in accordance with the tests described in Section 9.3(a)(i).

(f)              To the extent deemed necessary by the Administrator in order to comply with such requirements, the Administrator may, in accordance with Plan Rules, prospectively decrease the rate at which a Participant may make After-Tax Contributions. 

9.4.           Multiple Use Limitation.

(a)              This section applies for any Plan Year for which the sum of the actual deferral percentage for eligible employees who are Highly Compensated Employees, plus the actual contribution percentage for eligible employees who are Highly Compensated Employees, exceeds the "aggregate limit."  For purposes of this subsection, the aggregate limit is the greater of:

(i)              The sum of:

(1)            the product of one and one-quarter, multiplied by the greater of

(A)           the actual deferral percentage for the Plan Year for eligible employees who are not Highly Compensated Employees or

(B)            the actual contribution percentage for the Plan Year for eligible employees who are not Highly Compensated Employees;

plus

(2)             the sum of two percentage points plus the lesser of the actual deferral percentage determined under item (A) of clause (1) above or the actual contribution percentage determined under item (B) of clause (1) above, with such sum in no case exceeding twice the lesser of such actual deferral percentage or actual contribution percentage;

or

(ii)            The sum of:

(1)            the product of one and one-quarter, multiplied by the lesser of

(A)           the actual deferral percentage for the Plan Year for eligible employees who are not Highly Compensated Employees or

(B)            the actual contribution percentage for the Plan Year for eligible employees who are not Highly Compensated Employees;

plus

(2)            the sum of two percentage points plus the greater of the actual deferral percentage determined under item (A) of clause (1) above or the actual contribution percentage determined under item (A) of clause (1) above, with such sum in no case exceeding twice the lesser of such actual deferral percentage or actual contribution percentage.

(b)             If, for any Plan Year, the calculations under Subsection (a) require that this section be applied, the Administrator  will determine the amount by which After-Tax Contributions made by, andMatching Contributions made on behalf of, each Highly Compensated Employee for the Plan Year causes the excess amount determined under Subsection (a), such determination being made in accordance with the provisions of Section 9.3(b).  At such time as the Administrator  specifies on or following the last day of the Plan Year for which such determination is made, but in no case later than the last day of the following Plan Year, the excess will be corrected in accordance with Section 9.3(c).

(c)              To the extent provided in Treasury Regulations, the limitations described in this section do not apply to any group of eligible employees who are included in a unit of employees covered by a collective bargaining agreement.

9.5.           Earnings or Losses on Excess Contributions.

(a)              The amount of Fund earnings or losses with respect to the excess amount of contributions returned to a Highly Compensated Employee pursuant to this article is an amount equal to the product of the total earnings or losses for the Participant's Account to which the excess contributions were credited for the Plan Year with respect to which the determination is being made, multiplied by a fraction, the numerator of which is the excess amount of contributions made on the Participant's behalf to such Account for the Plan Year, and the denominator of which is the closing balance of such Account for the Plan Year, decreased by the amount of earnings added to that Account, or increased by the amount of losses charged to that Account, for the Plan Year. 

(b)            Contributions returned pursuant to Section 9.6(c)(iii) will also include the earnings or losses attributable to such excess amount for the period between the end of the Plan Year with respect to which the determination is being made and the date on which such excess contributions are distributed to the Participant.  The earnings or losses attributable to such excess amount for such period will be an amount equal to the product of ten percent of the earnings or losses attributable to such excess amount for the Plan Year, as determined in accordance with Subsection (a), multiplied by the number of calendar months during the period for which the determination is being made, with a distribution being made on or before the fifteenth day of a month being deemed to have been made on the last day of the preceding month and a distribution being made after the fifteenth day of a month being deemed to have been made on the first day of the following month.

9.6.           Annual Additions Limitation.

(a)              Notwithstanding any contrary provisions of the Plan, there will not be allocated to any Participant's Accounts for a Plan Year any amount that would cause the aggregate "annual additions" with respect to the Participant for the Plan Year to exceed the lesser of:

(i)              $30,000 (or such dollar amount, adjusted to reflect increases in the cost of living, as in effect under Code section 415(c)(1)(A) for the calendar year during which the Plan Year in question begins); and

(ii)            25 percent of the Participant's Section 415 Wages for the Plan Year.

(b)             For purposes of Subsection (a), the "annual additions" with respect to a Participant for a Plan Year are the sum of:

(i)              the aggregate amount of 401(k), After Tax, Matching and Profit Sharing Contributions allocated to the Participant's Accounts under the Plan for the Plan Year (including the amount of any 401(k), Matching or After-Tax Contributions distributed to the Participant or forfeited pursuant to Section 9.2(d) or 9.3(c) but excluding any 401(k) Contributions in excess of the limitation set forth in Section 9.1 that are distributed to the Participant by April 15 of the year following the year to which such contributions relate) and employer contributions, employee contributions and forfeitures allocated to the Participant's accounts under any other qualified defined contribution plan maintained by any Affiliated Organization for the Plan Year; plus

(ii)            the amount, if any, attributable to post-retirement medical benefits that is allocated to a separate account for the Participant as a "key employee" within the meaning of Code section 416(i), to the extent required under Code section 419A(d)(1).

Unless otherwise provided in Treasury Regulations, if a 401(k), Matching or Profit Sharing Contribution with respect to a Plan Year is made more than 30 days after the due date (including extensions) of the Company's federal income tax return for the Company's taxable year coinciding with the Plan Year or in which the Plan Year ends, the contribution will be an annual addition for the Plan Year during which the contribution is made.  If an After-Tax Contribution with respect to a Plan Year is made more than 30 days after the end of the Plan Year, the contribution will be an annual addition for the Plan Year during which the contribution is made.

(c)              

(i)              To the extent deemed advisable by the Administrator to prevent the limitation under Subsection (a) from being exceeded, the Administrator may, in accordance with Plan Rules, prospectively decrease a Participant's After-Tax Contributions or 401(k) Contributions.

(ii)            If a further reduction of contributions is required, the amount of the Matching Contribution that would otherwise be allocated to the Participant's Account will be reduced and the aggregate amount of the Matching Contribution for the Plan Year will be reduced by the same amount and then the Profit Sharing Contribution that would otherwise be allocated to the Participant's Profit Sharing Contribution Account will be reduced and the aggregate amount of the Profit SharingContribution for the Plan Year will be reduced by the same amount.

(iii)          If, in spite of such reduction and as a result of the allocation of forfeitures or a reasonable error in estimating the amount of the Participant's Eligible Earnings, Section 415 Wages, 401(k) Contributions or other elective deferrals within the meaning of Code section 402(g)(3) for the Plan Year, the limitation would otherwise be exceeded, then, to the extent required to prevent such excess:

(1)            the amount of After-Tax Contributions made by the Participant for the Plan Year, together with earnings on such contributions, will be distributed to the Participant; then

(2)            the amount of 401(k) Contributions made for the Participant, together with earnings on such contributions, will be distributed to the Participant and any Matching Contributions attributable to the amount so distributed, together with earnings on such contributions, will be forfeited and applied as provided in Section 3.3(d); then

(3)            if a further excess would otherwise exist, the amount of such excess will be held unallocated in a suspense account and will be allocated to all other eligible Participants for the Plan Year and, to the extent necessary, subsequent Plan Years, before Matching and Profit Sharing Contributions are made for such Plan Year or Years, and will be applied toward the amount of such contributions for such Plan Year or Years.

9.7.           Administrator's Discretion.  Notwithstanding the foregoing provisions of this article, the Administrator may apply the provisions of Sections 9.1through 9.6 in any manner permitted by Treasury Regulations that will cause the Plan to satisfy the limitations of the Code incorporated in such sections and Treasury Regulations thereunder, and the Administrator's good faith application of Treasury Regulations is binding on all Participants and Beneficiaries.

ARTICLE 10. Service Rules

10.1.        Vesting Service.  The term "Vesting Service" with respect to an Employee means, except as provided in Section 10.3, the aggregate number of Plan Years during each of which the Employee completes at least 1000 Hours of Service.

10.2.        One-Year Break in Service.  An Employee will incur a "One-Year Break in Service" if the Employee fails to complete at least 500 Hours of Service during a Plan Year; provided, that, for purposes only of determining whether an Employee has incurred such a One-Year Break in Service, in addition to Hours of Service credited under Section 10.5, there will be taken into account the number of Hours of Service that otherwise would have been credited to the Employee, or, if the number of such hours of service cannot be determined, eight hours of service for each day on which the Employee would have otherwise performed services for an Affiliated Organization, during an authorized leave of absence, while still employed with the Affiliated Organization, pursuant to any established, nondiscriminatory leave policy of an Affiliated Organization or due to:

(a)              the Employee's pregnancy;

(b)             the birth of the Employee's child;

(c)              the placement of a child with the Employee in connection with the adoption of such child by the Employee; or

(d)             the Employee's caring for such child for a period beginning immediately following such birth or placement;

provided, first, that the total number of such additional Hours of Service taken in to account by reason of any such absence will not exceed 501; second, that, if the Employee would be prevented from incurring a One-Year Break in Service for the Plan Year in which such absence commenced solely because the additional Hours of Service are so credited, such Hours of Service will be credited only to such Plan Year or, if a One-Year Break in Service for such Plan Year would not be so prevented, such additional Hours of Service will be credited to the Plan Year following the Plan Year during which such absence commenced; and third, that, notwithstanding the foregoing, no such additional Hours of Service will be credited in connection with an absence for one of the reasons set forth at items (a) through (d) unless the Employee furnishes to the Administrator, on a timely basis, such information as the Administrator reasonably requires in order to establish the number of days during which the Employee was absent for that reason.  In addition, an Employee will be credited with Hours of Service for the purpose of determining whether he or she has incurred a One-Year Break in Service to the extent required by the Family and Medical Leave Act of 1993.

10.3.        Loss of Service.  If an Employee terminates employment and experiences at least five consecutive One-Year Breaks in Service, then:

(a)              if the Employee had a vested interest in his or her Account prior to the Breaks in Service,

(i)              his or her Vesting Service completed prior to such Breaks in Service will be taken into account in determining his or her vested interest in his or her Accounts attributable to contributions made for periods after the Breaks in Service but only if the Employee completes one year of Vesting Service following such Breaks in Service and

(ii)            the extent of the Employee's vested interest in his or her Accounts as determined under Section 7.1 prior to the Breaks in Service will not be increased by Vesting Service completed following the Breaks in Service; or

(b)             if the Employee had no vested interest in his or her Account prior to the Breaks in Service, the Employee's service completed prior to the Breaks in Service will not be taken into account for any purpose under the Plan.

10.4.        Pre-Acquisition Service.  Service with an entity (all or any portion of which is acquired by, merges with or becomes an Affiliated Organization) for any period prior to the date of the acquisition, merger or affiliation will be taken into account under this Plan only if, to the extent and for the purposes, specified on an exhibit to the Plan, as provided for in Section 14.1(f). 10.5.        Hour of Service.

(a)              Subject to the remaining subsections of this section, the term "Hour of Service," with respect to an Employee, includes and is limited to:

(i)              each hour for which the Employee is paid, or entitled to payment, for the performance of duties for an Affiliated Organization;

(ii)            each hour:

(1)            for which the Employee is paid, or entitled to payment, by an Affiliated Organization 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 (including disability), layoff, jury duty, military duty or leave of absence;

 (2)            for which the Employee is not paid or entitled to payment but which is required by federal law to be credited to the Employee on account of his or her military service or similar duties; and

(3)            for which back pay, irrespective of mitigation of damages, is either awarded or agreed to by an Affiliated Organization; provided, first, that Hours of Service taken into account under clause (i), (ii)(1) or (ii)(2) will not also be taken into account under this clause (3); and second, that Hours of Service taken into account under this clause (3) that relate to periods specified in clause (ii)(1) will be subject to the rules under Subsection (b). 

(b)            The following rules will apply for purposes of determining the Hours of Service completed by an Employee under Subsection (a)(ii)(1):

(i)              No more than 501 hours will be credited to the Employee on account of any single continuous period during which the Employee performs no duties (whether or not such period occurs in a single Plan Year);

(ii)            No more than the number of hours regularly scheduled for the performance of duties for the period during which no duties are performed will be credited to the Employee for such period;

 (iii)          The Employee will not be credited with hours for which payments are made or due under a plan maintained solely for the purpose of complying with workers compensation, unemployment compensation or disability insurance laws, or for which payments are made solely to reimburse the Employee for medical or medically related expenses;

(iv)          A payment will be deemed to be made by or due from an Affiliated Organization, regardless of whether such payment is made by or due from the Affiliated Organization directly or indirectly through a trust fund or insurer to which the Affiliated Organization contributes or pays premiums;

 (v)            If the payment made or due is calculated on the basis of units of time, the number of Hours of Service to be credited will be the number of regularly scheduled working hours included in the units of time on the basis of which the payment is calculated; provided, that, if such a payment is made to an Employee described in Subsection (d)(i), the number of Hours of Service to be credited will be the number of equivalent hours determined under Subsection (d)(i) that are included in the units of time on the basis of which the payment is calculated;

(vi)          If the payment made or due is not calculated on the basis of units of time, the number of Hours of Service to be credited will be equal to the amount of the payment, divided by the Employee's most recent hourly rate of compensation before the period during which no duties are performed; and

 (vii)        Hours will be determined in accordance with Section 2530.200(b)-2(b) of the Department of Labor Regulations which is incorporated herein by reference.

(c)              Hours of Service will be credited:

(i)              in the case of Hours of Service described in Subsection (a)(i), to the Plan Year in which the duties are performed;

(ii)            in the case of Hours of Service described in Subsection (a)(ii)(1), to the Plan Year or Plan Years in which the period during which no duties are performed occurs; provided, that, if the payment is not calculated on the basis of units of time, the Hours of Service will not be allocated between more than the first two Plan Years of such period;

(iii)          in the case of Hours of Service described in Subsection (a)(ii)(2), to the Plan Year or Plan Years determined by the Administrator in accordance with the applicable federal law;

(iv)          in the case of Hours of Service described in Subsection (a)(ii)(3), to the Plan Year or Plan Years to which the award or agreement for back pay pertains; and

(v)            as otherwise provided in Section 2530.200(b)-2(c) of the Department of Labor Regulations which is incorporated herein by reference.

(d)             For purposes of determining the number of Hours of Service completed by an Employee during a particular period of time:

(i)              an Employee who is not subject to the overtime provisions of the Fair Labor Standards Act of 1938, as from time to time amended, will be credited with 45 Hours of Service for each week during which he or she completes at least one Hour of Service; and

(ii)            each other Employee will be credited with the number of Hours of Service that he or she completes during such period.

(e)              Notwithstanding the foregoing provisions of this section, an individual will be credited with the number of Hours of Service he or she completes, determined in the manner specified in Subsections (a) through (d):

(i)              while a Leased Employee; and

(ii)            with any other organization to the extent such Hours of Service are required to be taken into account pursuant to Treasury Regulations under Code section 414(o).

ARTICLE 11. Adoption, Amendment and Termination

11.1.        Adoption by Affiliated Organizations.  With the prior approval of the Administrator, an Affiliated Organization may adopt this Plan and become a Participating Employer.  Any special provisions applicable to a Participating Employer's Employees will be set forth on an exhibit to the Plan.  Any adoption of the Plan by an Affiliated Organization will be effective only if approved in advance or subsequently ratified by the Company's Board prior to the end of the fiscal year of such Affiliated Organization in which it adopts the Plan. 11.2.        Authority to Amend and Procedure.

(a)              The Company reserves the right to amend the Plan at any time, to any extent.  Each amendment must be stated in a written instrument approved in advance or subsequently ratified by the Company's Board and executed in the name of the Company by a duly authorized officer or the Company's Director of Compensation, Benefits & HRIS, and attested by the Secretary or an Assistant Secretary.  On and after the effective date of the amendment, all interested persons will be bound by the amendment; provided, that no amendment will have any retroactive effect so as to deprive any Participant, or any Beneficiary of a deceased Participant, of any benefit already accrued or vested or of any option with respect to the form of such benefit that is protected under Code section 411(d)(6), except that an amendment required to qualify the Trust for income tax exemption may be retroactive to the Effective Date of the Plan or to any later date.

(b)             If the provisions for determining the extent to which benefits under the Plan are vested are changed, whether by amendment or because of the Plan's becoming or ceasing to be a top-heavy plan, each Participant who has completed at least three years of Vesting Service may elect to have his or her vested benefits determined without regard to such change by giving written notice of such election to the Administrator within the period beginning on the date such change was adopted (or the Plan's top heavy status changed) and ending 60 days after the latest of:  (i) the date such change is adopted; (ii) the date such change becomes effective; and (iii) the date the Administrator issues notice of such change to the Participant. 

(c)              To the extent required by Code section 411(d)(6), each Participant may elect to have that portion of his or her Accounts that was accrued as of the date an optional form of benefit payment is eliminated distributed in such optional form.

(d)             The provisions of the Plan in effect at the termination of a Participant's employment will, except as specifically provided in any subsequent amendment, continue to apply to such Participant.

11.3.        Authority to Terminate and Procedure.  The Company expects to continue the Plan indefinitely but reserves the right to terminate the Plan in its entirety at any time by a written instrument of termination.  Each Participating Employer expects to continue its participation in the Plan indefinitely but reserves the right to cease its participation in the Plan at any time.  The Plan will terminate in its entirety as of the date specified by the Company in a written notice adopted and executed in the manner of an amendment.  The Plan will terminate with respect to a Participating Employer as of a date specified in a written instrument approved in advance or ratified by the Participating Employer's Board and executed in the name of the Participating Employer by a duly authorized officer. 

11.4.        Vesting Upon Termination, Partial Termination or Discontinuance of Contributions.  Upon the termination of the Plan or upon the complete discontinuance of contributions, the Accounts of each "affected employee" will vest in full.  For purposes of this section, "affected employee" means

(a)              a Participant who is actively employed with an Affiliated Organization on the effective date of the termination or complete discontinuance of contributions;

(b)            a Participant who has terminated employment and has neither received a complete distribution of his or her Account nor experienced at least five consecutive One-Year Breaks in Service;

(c)             a former Participant who terminated employment during the Plan Year that includes the effective date of the termination or complete discontinuance of contributions.

Upon a partial termination of the Plan, the Accounts of each Participant as to whom the Plan has been partially terminated will vest in full.

11.5.        Distribution Following Termination, Partial Termination or Discontinuance of Contributions.  After termination or partial termination of the Plan or the complete discontinuance of contributions under the Plan, the Trustee will continue to hold and distribute the Fund as if such event had not occurred, but if the Administrator so directs in accordance with Treasury Regulations, the Trustee will distribute to each Participant the entire balance of his or her Accounts.

ARTICLE 12. PLAN ADMINISTRATION

12.1.        Administrator, Named Fiduciary.  The Company is the "named fiduciary" of the Plan for purposes of ERISA.  12.2.       Committee. 

(a)              The general administration of the Plan and the duty to carry out its provisions is vested in a Committee composed of not fewer than three members who will serve at the pleasure of the Company's Board.  One member of the Committee will be the head of the Company's human resources function, a second member of the Committee will be the head of the Company's financial function and a third member of the Committee will be the head of the Company's treasury function. Additional members may be appointed to the Committee by the Company's Board to serve at its pleasure. Each such additional member will file written acceptance of his or her appointment with the Company's Board.  A Committee member may resign by delivering his or her written resignation to the Company's Board, and any Committee member may be removed, with or without cause, by the Company's Board upon delivery of written notice of such removal to the removed member.  Any such resignation or removal will be effective upon delivery of the written resignation or notice of removal, as the case may be, or upon any later date specified therein.  Vacancies created by any such resignation or removal will be filled by appointment by the Company's Board; provided, that, subject to there being at least three persons serving as Committee members at all times, the Company's Board need not fill any vacancy so created.

(b)             In addition to its general duties and power and authority in connection with the administration of the Plan, the Committee has the discretionary power and authority with respect to -

(i)               The selection, designation and removal of the Administrator, the Trustee and any investment managers of the Fund;

(ii)             The direction of investments of assets comprising the Fund in insurance-company issued deposit administration or similar group annuity contract or contracts; and

(iii)           In the case of any investment fund maintained pursuant to Section 5.1 the assets of which are primarily invested in one or more insurance company issued deposit administration or group annuity contracts, to determine, from time to time, the portion of such investment fund, if any, that will not be invested in such insurance-company issued contracts and to direct the Trustee as to the specific investments or types of investments with respect to such portion of such investment fund; provided, that nothing contained in this clause (iii) requires the Committee to exercise such power or authority or limits the power or authority of the Committee to delegate any such duties to the Administrator, the Trustee or any investment manager.

(c)              The Committee will perform its duties in accordance with the following procedures.

(i)               The head of the Company's human resources function will act as the chair of the Committee and will preside over the Committee's meetings.

(ii)             The Committee will designate the head of the Company's human resources function, or such other person as it may determine, to serve as Administrator pursuant to Section 12.3, and may from time to time revoke such designation and designate another person to serve as Administrator. Each such designation must be in writing, and a copy of the designation must be furnished to the Administrator and the Trustee.  The person designated to act as Administrator must file a written acceptance with the Committee.  Such person's duty hereunder will terminate upon revocation of such designation by the Committee or upon resignation as Administrator by the person so designated. Such revocation or resignation must be in writing and will be effective upon delivery thereof to the Administrator or the Committee as the case may be, and in either case to the Trustee.

(iii)           The Committee will elect a secretary who may, but need not, be a member of the Committee.  The secretary will keep minutes of the Committee's meetings and perform such other duties as may be specified from time to time by the Committee.

(iv)           The Committee may appoint such subcommittees with such duties and powers as it may specify, and it may delegate administrative powers to one or more of its members or to such other person or entity as it may designate.

(v)             The Committee will meet at such times and places and upon such notice as its members may determine from time to time.  A majority of the current membership of the Committee will constitute a quorum for the transaction of business, and all acts of the Committee at any meeting will require, for their validity, the affirmative vote of a majority of the current membership of the Committee.  The Committee may act without a meeting by the written authorization of a majority of the members of the Committee.

(vi)           The Committee may adopt bylaws for the conduct of its business, provided such bylaws are not inconsistent with the provisions of this article.

(vii)         No member of the Committee may vote with respect to a decision of the Committee relating solely to his or her own participation or benefit under the Plan.

12.3.        Administrative Duties.  To the extent applicable to their respective administrative duties, the Committee and the Administrator have the discretionary power and authority, and the responsibility, to:

(a)              Adopt rules, regulations and procedures not inconsistent with the provisions of the Plan and uniform and equitable with respect to individuals determined by the Administrator to be similarly situated at the time in question, and to revoke or modify such rules and regulations at any time;

(b)             Interpret, construe, apply and enforce the provisions of the Plan and any Plan Rules, including the discretionary and final power and authority to interpret, construe, apply and enforce uncertain provisions of the Plan or Plan Rules, and remedy possible ambiguities, inconsistencies, omissions and errors, and any such action taken by the Committee or the Administrator in good faith is binding upon all Participants, Beneficiaries, alternate payees and other interested persons;

(c)              Determine from time to time the status of all Employees, Qualified Employees, Participants, Beneficiaries, alternate payees and other interested persons for purposes of the Plan;

(d)             Determine the rights of Employees, Qualified Employees, Participants, Beneficiaries, alternate payees and other interested persons to benefits under the Plan, the amount and the method and time or times of payment of the benefit; and

(e)              Take any other actions determined by the Committee or the Administrator to be necessary or advisable to in connection with the administration of the Plan.

12.4.        Delegation.  Except as otherwise provided in ERISA, the Administrator may delegate specific duties and responsibilities, including fiduciary duties and responsibilities.  Such delegations may be to Employees or to other individuals, committees or entities.  Any delegation may, if specifically stated, allow further delegations by the individual, committee or entity to whom or which the delegation has been made subject to and in accordance with any limitations, restrictions or conditions specified in the delegation or in any other written instrument provided by the Administrator to the individual, committee or entity to whom or which the delegation has been made.  Any delegation may be rescinded by the Administrator at any time.  Each individual, committee or entity to whom or which a fiduciary duty or responsibility has been delegated is responsible for the exercise of such duties or responsibilities and is not responsible for the acts or failure to act of any other fiduciary.  Any delegation by the Administrator of a fiduciary duty or responsibility, other than to a person for whose conduct the Administrator remains responsible, must be in writing, and the individual, committee or entity to whom or which the delegation is made must submit a written acceptance of the delegation to the Administrator.  Any delegate's duty will terminate upon withdrawal of such authority by the Administrator or upon withdrawal of the delegate's acceptance.  Any delegation to an Employee will automatically terminate when he or she ceases to be an Employee.

12.5.        Reports and Records.  The Administrator and those individuals, committees or entities to whom or which theAdministrator has delegated fiduciary duties will keep records of all their proceedings and actions, and will maintain all such books of account, records and other data as necessary for the proper administration of the Plan and to comply with applicable law. 

12.6.        Compensation.  No employee of an Affiliated Organization acting in a fiduciary capacity will be entitled to receive compensation from the Trust for such services, but each will be  entitled to reimbursement from the Trust for all sums reasonably and necessarily expended in the performance of such duties.

12.7.        Professional Assistance.  The Committee and the Administrator may retain such accounting, recordkeeping, legal, clerical and other services as may reasonably be required in the administration of the Plan, and may pay reasonable compensation from the Fund for such services or may reimburse the Company from the Fund for reasonable compensation paid by the Company for such services.  The Committee and the Administrator are entitled to rely conclusively on all tables, valuations, certificates, opinions and reports furnished to them by such persons and on all information, elections and designations furnished to them by Participants, Beneficiaries, alternate payees and Participating Employers.

12.8.        Payment of Administrative Costs.  All costs of administering the Plan may be paid by the Trustee from the Trust, but if not so paid, will be paid by the Company.

12.9.        Indemnification.

(a)              To the extent permitted by law, the Participating Employers jointly and severally agree to indemnify and hold harmless the Administrator, the members of any fiduciary committee and other employees, officers or directors of an Affiliated Organization to whom fiduciary duties are delegated against any and all claims, losses, damages, expenses and liabilities arising from their responsibilities in connection with the Plan which are not covered by insurance (without recourse) paid for by the Participating Employers or otherwise paid or reimbursed, unless they are determined to be due to gross negligence or intentional misconduct.  The Company has the right, but not the obligation, to select counsel and control the defense and settlement of any action for which an individual may be entitled to indemnification pursuant to this section.

(b)             An individual's right to indemnification pursuant to this section is in addition to, and independent of, the individual's right, if any, to indemnification pursuant to a Participating Employer's articles of incorporation or bylaws (or comparable governing instruments), applicable law or otherwise, but an individual is not entitled to indemnification from all sources in an amount that exceeds his or her claims, losses, damages, expenses and liabilities.

12.10.     Claims Procedure.

(a)              The Administrator will notify a Participant in writing, within 90 days of the Participant's written application for benefits, of the Participant's eligibility or noneligibility for benefits under the Plan.  If the Administrator determines that a Participant is not eligible for benefits or full benefits, the notice will:

(i) state the specific reasons for the denial of any benefits;

(ii) provide a specific reference to the provision of the Plan on which the denial is based;

(iii) provide a description of any additional information or material necessary for the claimant to perfect the claim, and a description of why it is needed; and

(iv) provide an explanation of the Plan's claims review procedure and other appropriate information as to the steps to be taken if the Participant wishes to have the claim reviewed.  If the Administrator determines that there are special circumstances requiring additional time to make a decision, the Administrator will notify the Participant of the special circumstances and the date by which a decision is expected to be made, and may extend the time for up to an additional 90-day period. 

(b)             If a Participant is determined by the Administrator not to be eligible for benefits or if the Participant believes that he or she is entitled to greater or different benefits, the Participant will be provided the opportunity to have his or her claim reviewed by the Administrator by filing a petition for review with the Administrator within 60 days after the Participant receives the notice issued by the Administrator.  The petition must state the specific reasons the Participant believes he or she is entitled to benefits or greater or different benefits.  Within 60 days after the Administrator receives the petition, the Administrator  will give the Participant (and his or her counsel, if any) an opportunity to present his or her position to the Administrator orally or in writing, and the Participant (or his or her counsel) may review the pertinent documents, and the Administrator will notify the Participant of its decision in writing within said 60-day period, stating specifically the basis of the decision written in a manner calculated to be understood by the Participant and the specific provisions of the Plan on which the decision is based.  If, because of the need for a hearing, the 60-day period is not sufficient, the decision may be deferred for up to another 60-day period at the election of the Administrator, but notice of this deferral must be given to the Participant. 

(c)              In the event of the death of a Participant, the same procedure applies to the Beneficiary of the Participant. 

(d)             A claimant must exhaust the procedure described in this section before pursuing the claim in any other proceeding.

12.11.     Disputes.

(a)              A Participant, Beneficiary or alternate payee may not commence a civil action pursuant to ERISA section 502(a)(1), with respect to a benefit under the Plan after the earlier of:

(i)              three years after the occurrence of the facts or circumstances that give rise to or form the basis for such action; and

(ii)            one yearfrom the date the Participant, Beneficiary or alternate payee had actual knowledge of the facts or circumstances that give rise to or form the basis for such action.

(b)            In the case of a dispute between a Participant, Beneficiary, alternate payee or other person claiming a right or entitlement pursuant to the Plan and a Participating Employer, the Administrator, the Committee or other person relating to or arising from the Plan, the United States District Court for the District of Minnesota is a proper venue.  Regardless of where an action relating to or arising from the Plan is pending, the law as stated and applied by the United States Court of Appeals for the Eighth Circuit or the United States District Court for the District of Minnesota will apply to and control all actions relating to the Plan brought against the Plan, a Participating Employer, the Administrator, the Committee or any other person or against any Participant, Beneficiary, alternate payee or other person claiming a right or entitlement pursuant to the Plan.

12.12.     Correction of Errors.  If the Administrator determines that, by reason of administrative error or other cause attributable to a Participating Employer, the Account of any Participant has incurred a loss, the Administrator may enter into an agreement with the Participating Employer under which the Account is fully restored and may, upon such restoration, release the Participating Employer from further responsibility.

12.13.    Standards for Elections, Directions and Similar Actions.  Any election, direction, application, designation or similar action required of a Participant, Beneficiary or alternate payee (or any person claiming by, through or on behalf of a Participant, Beneficiary or alternate payee) pursuant to the Plan must be made in accordance with and is subject to the terms of the Plan and Plan Rules.

ARTICLE 13. Miscellaneous

13.1.        Merger, Consolidation, Transfer of Assets.  If this Plan is merged or consolidated with, or his or her assets or liabilities are transferred to, any other plan, each Participant will be entitled to receive a benefit immediately after such merger, consolidation or transfer (if such other plan were then terminated) that is equal to or greater than the benefit he or she would have been entitled to receive immediately before such merger, consolidation or transfer (if this Plan had then terminated but without regard to Section 11.4).

13.2.        Limited Reversion of Fund.

(a)              Except as provided in Subsection (b), no corpus or income of the Trust will at any time revert to any Affiliated Organization or be used other than for the exclusive benefit of Participants and their Beneficiaries by paying benefits and administrative expenses of the Plan.

(b)             Notwithstanding any contrary provision in the Plan:

(i)              All contributions made by a Participating Employer to the Trustee prior to the initial determination of the Internal Revenue Service as to qualification of the Plan under Code section 401(a) and the tax exempt status of the Trust under Code section 501(a) will be repaid by the Trustee to the Participating Employer, upon the Participating Employer's written request, if the Internal Revenue Service rules that the Plan is not qualified or the Trust is not tax exempt; provided, that the Participating Employer must request such determination within a reasonable time after adoption of the Plan and the repayment by the Trustee to the Participating Employer must be made within one year after the date of denial of qualification of the Plan; and

(ii)            To the extent a contribution is made by a Participating Employer by a mistake of fact or a deduction is disallowed a Participating Employer under Code section 404, the Trustee will repay the contribution to the Participating Employer upon the Participating Employer's written request; provided, that such repayment must be made within one year after the mistaken payment is made or the deduction is disallowed, as the case may be.  Each contribution to the Plan by a Participating Employer is expressly conditioned on such contribution's being fully deductible by the Participating Employer under Code section 404.

13.3.        Top-Heavy Provisions.

(a)             The provisions of this subsection will apply for any Plan Year during which the Plan is "top heavy."

(i)              Notwithstanding the provisions of Article 3, no contributions will be made and allocated on behalf of any "key employee" for any Plan Year during which the Plan is top heavy unless the amount of contributions (excluding 401(k) Contributions) made and allocated for such Plan Year on behalf of each Participant who is not a key employee and who is employed with an Affiliated Organization on the last day of the Plan Year, expressed as a percentage of the Participant's Testing Wages for the Plan Year, is at least equal to the lesser of:

(1)            three percent; or

(2)            the largest percentage of such Testing Wages at which contributions (including 401(k) Contributions) are made and allocated on behalf of any key employee for such Plan Year.

(ii)            If, in addition to this Plan, an Affiliated Organization maintains another qualified defined contribution plan or one or more qualified defined benefit pension plans during a Plan Year, the provisions of clause (i) will be applied for such Plan Year:

(1)            by taking into account the employer contributions (other than elective deferrals for a non-key employee) on behalf of the Participant under all such defined contribution plans; and

(2)            without regard to any Participant who is not a key employee and whose accrued benefit, expressed as a single life annuity, under a defined benefit pension plan maintained by the Affiliated Organization for such Plan Year is not less than the product of

(A)           the Participant's average Testing Wages for the period of consecutive years not exceeding the period of consecutive years (not exceeding five) when the Participant had the highest aggregate Testing Wages, disregarding years in which the Participant completed less than 1000 Hours of Service, multiplied by

(B)           the lesser of (I) two percent per year of service, disregarding years of service beginning after the close of the last Plan Year in which such defined benefit plan was a top heavy plan or (II) 20 percent.

(iii)          Notwithstanding Section 7.1(h), each Participant's vested nonforfeitable interest in the portion of his or her Profit Sharing Contribution Account not described in Section 7.1(a) to the extent provided in the following schedule:

Full Years of Vesting Service Less than Three Years
Three or More Years Vested
Interest

  0  %
100%

If the Plan ceases to be a top heavy plan, the portion of a Participant's Profit Sharing Contribution Account that has vested pursuant to the foregoing schedule will remain nonforfeitable, notwithstanding the subsequent application of the vesting schedule set forth in Section 7.1(h) to amounts subsequently allocated to the Account.

(b)            For purposes of Subsection (a),

(i)               

(1)            The Plan will be a "top-heavy plan" for a particular Plan Year if, as of the last day of the initial Plan Year or, with respect to any other Plan Year, as of the last day of the preceding Plan Year, the aggregate of the Account balances of key employees is greater than 60 percent of the aggregate of the Account balances of all Participants.

(2)            For purposes of calculating the aggregate Account balances for both key employees and employees who are not key employees:

(A)           Any distributions made within the five-year period preceding the Plan Year for which the determination is being made, other than a distribution transferred or rolled over to a plan maintained by an Affiliated Organization, will be included;

(B)           Amounts transferred or rolled over from a plan not maintained by an Affiliated Organization at the initiation of the Participant will be excluded;

(C)           The Account balances of any key employee and any employee who is not a key employee who has not performed an Hour of Active Service at any time during the five-year period ending on the date as of which the determination is being made will be excluded; and

(D)           The terms "key employee" and "employee" include the Beneficiaries of such persons who have died.

(ii)             

(1)            Notwithstanding the provisions of clause (i), this Plan will not be a top-heavy plan if it is part of either a "required aggregation group" or a "permissive aggregation group" and such aggregation group is not top-heavy.  An aggregation group will be top-heavy if the sum of the present value of accrued benefits and account balances of key employees is more than 60 percent of the sum of the present value of accrued benefits and account balances for all Participants, such accrued benefits and account balances being calculated in each case in the same manner as set forth in clause (i).

(2)            Each plan in a required aggregation group will be top-heavy if the group is top-heavy.  No plan in a required aggregation group will be top-heavy if the group is not top-heavy.

(3)            If a permissive aggregation group is top-heavy, only those plans that are part of an underlying top-heavy, required aggregation group will be top-heavy. No plan in a permissive aggregation group will be top-heavy if the group is not top-heavy.

(iii)          The "required aggregation group" consists of (1) each plan of an Affiliated Organization in which a key employee participates and (2) each other plan of an Affiliated Organization that enables a plan in which a key employee participates to meet the nondiscrimination requirements of Code sections 401(a)(4) or 410.

(iv)          A "permissive aggregation group" consists of those plans that are required to be aggregated and one or more plans (providing comparable benefits or contributions) that are not required to be aggregated, which, when taken together, satisfy the requirements of Code sections 401(a)(4) and 410.

 (v)            For purposes of applying clauses (ii), (iii) and (iv) of this Subsection (b), any qualified defined contribution plan maintained by an Affiliated Organization at any time within the five-year period preceding the Plan Year for which the determination being made which, as of the date of such determination, has been formally terminated, has ceased crediting service for benefit accruals and vesting and has been or is distributing all plan assets to participants or their beneficiaries, will be taken into account to the extent required or permitted under such clauses and under Code section 416.

(c)             A "key employee" is any individual who is or was employed with an Affiliated Organization and who, at any time during the Plan Year in question or any of the preceding four Plan Years is or was:

(i)              An officer of the Affiliated Organization (an administrative executive in regular and continued service with the Affiliated Organization) whose Section 415 Wages for such Plan Year exceed 50 percent of the amount in effect under Code section 415(b)(1)(A) for such Plan Year, but in no case will there be taken into account more than the lesser of (a) 50 persons, or (b) the greater of (i) three persons or (ii) ten percent of the number of the Affiliated Organization's employees, excluding for purposes of determining the number of such officers, any employees described in Code section 414(q)(5);

(ii)            The owner of an interest in the Affiliated Organization that is not less than the interest owned by at least ten other persons employed with the Affiliated Organization; provided, that, such owner will not be a key employee solely by reason of such ownership for a Plan Year if he or she does not own more than one-half of one percent of the value of the outstanding interests of the Affiliated Organization or if the amount of his or her Section 415 Wages for such Plan Year is less than the amount in effect under Code section 415(c)(1)(A) for such Plan Year;

(iii)          The owner of more than five percent of the Affiliated Organization's outstanding stock or more than five percent of the total combined voting power of the Affiliated Organization's stock; or

 (iv)          The owner of more than one percent of the Affiliated Organization's outstanding stock or more than one percent of the total combined voting power of the Affiliated Organization's stock, whose Section 415 Wages for such Plan Year exceed $150,000.

For purposes of this Subsection (c), ownership of an Affiliated Organization's stock will be determined in accordance with Code section 318; provided, that subparagraph 318(a)(2)(C) will be applied by substituting the phrase "5 percent" for the phrase "50 percent" wherever it appears in such Code section.

13.4.       Qualified Military Service.

(a)              The provisions of this section apply only to an Employee who is reemployed on or after December 12, 1994 and whose reemployment rights are protected under the Uniformed Services Employment and Reemployment Rights Act of 1994 ("USERRA") and are intended to comply with the requirements of Code section 414(u).

(b)             Notwithstanding any other provisions of the Plan to the contrary, a Qualified Employee who leaves the employ of a Participating Employer for qualified military service and returns to employment with a Participating Employer will be entitled to the restoration of benefits under the Plan which would have accrued but for the Qualified Employee's absence due to qualified military service. 

(c)              A Qualified Employee may make 401(k) Contributions and After-Tax Contributions for the Plan Years during which he or she would have been an Active Participant but for his or her qualified military service in accordance with Sections 3.1 and 3.2 and the following additional rules:

(i)              the Qualified Employee may elect to make 401(k) Contributions and After-Tax Contributions, subject to the maximums in effect pursuant to Sections 3.1 and 3.2 during the period of qualified military service;

(ii)            the Qualified Employee may make the election described in clause (i) at any time during the period that begins on his or her date of reemployment and has the same length as the lesser of five years or the period of the Qualified Employee's qualified military service multiplied by three;

(iii)          the 401(k) Contributions and After-Tax Contributions under this subsection are not subject to the limitations described in Section 9.2, 9.3 or 9.4.

(d)             A Qualified Employee's Participating Employer will make Matching Contributions with respect to the Qualified Employee's 401(k) Contributions pursuant to Subsection (c) in the same amount as if such 401(k) Contributions had actually been made during the Participant's period of qualified military service.  The Matching Contributions made pursuant to this subsection are not subject to the limitations described in Section 9.3 or 9.4.

(e)              The following additional rules and conditions apply with respect to qualified military service notwithstanding any contrary provision of the Plan:

(i)              an Employee will not be treated as having incurred a Break in Service by reason of his or her qualified military service;

(ii)            any period of qualified military service will be counted as Vesting Service;

(iii)          for purposes of determining the Qualified Employee's Eligible Earnings and Section 415 Wages, the Qualified Employee will be treated as receiving compensation from the Participating Employer with whom he or she was employed immediately before the period of qualified military service during the period of qualified military service in an amount equal to the compensation he or she would have received during such period if he or she were not in qualified military service determined based on the rate of pay the Qualified Employee would have received from the Participating Employer but for the absence due to qualified military service; provided, however, if the compensation the Qualified Employee would have received from the Participating Employer is not reasonably certain, then the Qualified Employee's rate of compensation will be equal to his or her average compensation for the 12-month period preceding the qualified military service (or, if shorter, the period of employment immediately preceding the qualified military service);

(iv)          contributions on behalf or by the Qualified Employee will be subject to the limitations in Sections 9.1 and 9.6 with respect to the Plan Years to which such contributions relate in accordance with Treasury Regulations;

(v)            the Qualified Employee will not be entitled to any crediting of earnings on contributions for any period prior to actual payment to the Trust; and

(vi)          the Qualified Employee will not be entitled to restoration of any forfeitures which were not allocated to his or her Account as a result of his or her qualified military service.

(f)               For purposes of this section, "qualified military service" means any service in the uniformed services as defined in USERRA by a Qualified Employee who is entitled to reemployment rights with a Participating Employer under USERRA.

13.5.        Short Plan Years.  To the extent required by and in accordance with Treasury Regulations, for any Plan Year that is less than 12 months long, the dollar limitations in effect for purposes of Code sections 401(a)(17), 414(q), 415 and 416 will be adjusted to reflect the short Plan Year.

ARTICLE 14. Construction, Interpretations AND DEFINITIONS

14.1.        Construction and Interpretations.  The rules of construction and interpretations set forth in this section apply in construing this instrument unless the context otherwise indicates.

(a)             Consent of Spouse.  Whenever the consent of a Participant's spouse is required with respect to any act of the Participant, such consent will be deemed to have been obtained only if:

(i)              the Participant's spouse executes a written consent to such act, which consent acknowledges the effect of such act and is witnessed by a Plan representative or a notary public; or

(ii)            the Administrator determines that no such consent can be obtained because the Participant has no spouse, because the Participant's spouse cannot be located, or because of such other circumstances as may, under Treasury Regulations, justify the lack of such consent.

Any such consent by the Participant's spouse or such determination by the Administrator that such spouse's consent is not required is effective only with respect to the particular spouse of the Participant who so consented or with respect to whom such determination was made.  Any such consent by the Participant's spouse to an act of the Participant under the Plan is irrevocable with respect to that act.

(b)            Governing Law.  To the extent that state law is not preempted by provisions of ERISA or any other laws of the United States, this Plan will be administered, construed, and enforced according to the internal, substantive laws of the State of Minnesota, without regard to its conflict of laws rules.

(c)             Headings.  The headings of articles and sections are included solely for convenience.  In the case of a conflict between a heading and the text of the Plan, the text controls.

(d)            No Employment Rights Created.  The establishment and maintenance of the Plan neither gives any Employee a right to continuing employment nor limits the right of an AffiliatedOrganization to discharge or otherwise deal with the Employee without regard to the effect such action might have on his or her initial or continued participation in the Plan.

(e)             Number and Gender.  Wherever appropriate, the singular number may be read as the plural, the plural may be read as the singular, and the masculine gender may be read as the feminine gender.

(f)              Special Provisions.  Special provisions of the Plan applicable only to certain Participants will be set forth on an exhibit to the Plan.  In the event of a conflict between the terms of the exhibit and the terms of the Plan, the exhibit controls.

14.2.        Definitions.  The definitions set forth in this section apply in construing this instrument unless the context otherwise indicates.

Account.  An "Account" with respect to a Participant is any or all of the accounts maintained on his or her behalf pursuant to Section 4.1, as the context requires.

Active Participant.  An "Active Participant" is a Participant who is a Qualified Employee.

Administrator.  The "Administrator" of the Plan is the Company or any individual or committee to whom or to which administrative duties are delegated by the Company with respect to the delegated duties.

Affiliated Organization.  An "Affiliated Organization" is the Company and any other corporation that is a member of a controlled group of corporations (within the meaning of Code section 1563(a) without regard to Code sections 1563(a)(4) and 1563(e)(3)(C)) that includes the Company, any trade or business (whether or not incorporated) that together with the Company is under common control (within the meaning of Code section 414(c)), any member of an "affiliated service group" (within the meaning of Code section 414(m)) of which the Company is a member or any other organization that, together with the Company, is treated as a single employer pursuant to Code section 414(o) and Treasury Regulations thereunder; provided, that, for purposes of applying the limitations set forth at Section 9.6, such determination under Code section 1563(a) will be made by substituting the phrase "more than 50 percent" for the phrase "at least 80 percent" wherever it appears in such Code section.

After-Tax Contribution Account.  The "After-Tax Contribution Account" is the account established pursuant to Section 4.1(a)(ii).

After-Tax Contributions.  "After-Tax Contributions" means contributions made by an Active Participant pursuant to Section 3.2.

Beneficiary.  A "Beneficiary" is a person designated or otherwise determined under the provisions of Section 8.2 as the distributee of benefits payable after the death of a Participant.  A person designated as, or otherwise determined to be, a Beneficiary under the terms of the Plan has no interest in or rights under the Plan until the Participant in question has died.  A Beneficiary will cease to be such on the day on which all benefits to which he, she or it is entitled under the Plan have been distributed.

Board.  The "Board" is the board of directors or comparable governing body of the Affiliated Organization in question.  When the Plan provides for an action to be taken by the Board, the action may be taken by any committee or individual authorized to take such action pursuant to a proper delegation by the board of directors or comparable governing body in question.

Code.  The "Code" is the Internal Revenue Code of 1986, as amended.  Any reference to a specific provision of the Code includes a reference to such provision, any valid ruling, regulation or authoritative pronouncement promulgated thereunder and any provision of future law that amends, supplements or supersedes the provision.

Committee.  The "Committee" is the administrative committee constituted under Section 12.2.

Company.  The "Company" is BMC Industries, Inc. or any successor thereto.

Company Stock.  "Company Stock" is the common stock of the Company.

Disabled.  A Participant will be considered to be "Disabled" only if

(a)       in the case of a Participant who is participating in the Company's long-term disability plan, he or she is receiving disability benefits under such plan, or

(b)       in the case of any other Participant, he or she is certified as being disabled by the Social Security Administration and is receiving disability benefits under the disability provisions of the Social Security Act.

Effective Date.  The "Effective Date" of the Plan is April 1, 1979.

Eligible Earnings. 

(a)             The "Eligible Earnings" of a Participant from a Participating Employer for any Plan Year for purposes of 401(k) Contributions, After-Tax Contributions and Matching Contributions is the sum of all remuneration paid to the Participant by the Participating Employer for the portion of a Plan Year in which he or she is an Active Participant that is reportable in the "wages, tips, other compensation" box of Internal Revenue Form W-2, increased by amounts that are deferred under Section 3.1 as 401(k) Contributions and amounts by which a Participant's compensation from the Participating Employer for such portion of the Plan Year is reduced under a Code section 125 cafeteria plan or by reason of Code section 132(f)(4).  To the extent otherwise included, Eligible Earnings are determined under this clause (a) by excluding the amount of any imputed income of the Participant with respect to the portion of the Plan Year in which he or she is an Active Participant, severance pay of any kind or nature, tuition aid, relocation reimbursement, payments made pursuant to the BMC Industries, Inc. Long-Term Incentive Plan or amounts attributable to a stock incentive award (including, but not limited to stock options, stock appreciation rights, restricted stock, performance units or stock bonuses).

(b)            The "Eligible Earnings" of a Participant from a Participating Employer for any Plan Year for the purpose of Profit Sharing Contributions is:

            (i)        for non-sales personnel --

            the Participant's annual base salary or wages paid to the Participant by the Participating Employer during the Plan Year, including shift premium, increased by amounts paid to the Participant by the Participating Employer during the Plan Year for time in excess of straight time but disregarding the portion of such amounts, if any, representing a premium over straight time rates, and

            (ii)       for sales personnel --

            the greater of (A) the Participant's annual base salary paid by the Participating Employer during the Plan Year, or (B) the lesser of (1) the Participant's annual base salary plus commissions paid by the Participating Employer during the Plan Year or (2) $60,000.

            To the extent otherwise included, Eligible Earnings are determined under this clause (b) by excluding severance pay of any kind or nature, tuition aid, relocation reimbursement, payments made pursuant to the BMC Industries, Inc. Long-Term Incentive Plan or amounts attributable to a stock incentive award (including, but not limited to stock options, stock appreciation rights, restricted stock, performance units or stock bonuses).

(c)              In no event will a Participant's Eligible Earnings for any Plan Year be taken into account to the extent it exceeds $150,000 (or such larger amount as may be permitted for the calendar year during which such Plan Year begins under Code section 401(a)(17)).

Eligible Rollover Distribution.  An "Eligible Rollover Distribution" is any distribution of all or any portion of the balance to the credit of the distributee, except that an Eligible Rollover Distribution does not include: any distribution that is one of a series of substantially equal periodic payments (not less frequently than annually) made for the life (or life expectancy) of the distributee or the joint lives (or joint life expectancies) of the distributee and the distributee's designated beneficiary, or for a specified period of ten years or more; any distribution to the extent such distribution is required under Code section 401(a)(9); the portion of any distribution that is not includable in gross income (determined without regard to the exclusion for net unrealized appreciation with respect to employer securities); any hardship distribution described in Code section 401(k)(2)(B)(i)(IV); and any other amount excepted from the definition of "eligible rollover distribution" by Code section 402(c)(4).

Employee.  An "Employee" is any individual who performs services for an Affiliated Organization as a common-law employee of the Affiliated Organization.

ERISA.  "ERISA" is the Employee Retirement Income Security Act of 1974, as amended.  Any reference to a specific provision of ERISA includes a reference to such provision, any valid ruling, regulation or authoritative pronouncement promulgated thereunder and any provision of future law that amends, supplements or supersedes the provision.

Excess Eligible Earnings.  The "Excess Eligible Earnings" of a Participant from a Participating Employer for a Plan Year means the portion of his or her Eligible Earnings from the Participating Employer for the Plan Year, if any, in excess of the contribution and benefit base in effect for the calendar year during which the Plan Year begins under section 230 of the Social Security Act.

401(k) Contribution Account.  The "401(k) Contribution Account" is the account established pursuant to Section 4.1(a)(i).  Prior to the Restatement Date, this account was called the "before-tax contribution account."

401(k) Contributions.  "401(k) Contributions" means contributions made by Participants pursuant to Section 3.1.  Prior to the Restatement Date, these contributions were called "before-tax contributions."

Fund.  The "Fund" is the total of all of the assets of every kind and nature, both principal and income, held in the Trust at any particular time or, if the context so requires, one or more of the investment funds described in Section 5.1.

Highly Compensated Employee.

(a)       A "Highly Compensated Employee" for any Plan Year is any employee who:

(i)              at any time during such Plan Year or the 12-month period preceding such Plan Year, owns or owned (or is considered as owning or having owned within the meaning of Code section 318) more than five percent of the outstanding stock of an Affiliated Organization or stock possessing more than five percent of the total combined voting power of all outstanding stock of an Affiliated Organization; or (ii)            during the 12-month period preceding such Plan Year, received compensation in excess of $80,000 (or such dollar amount, adjusted to reflect increases in the cost of living, as in effect under Code section 414(q)(1)(B) for the calendar year during which the Plan Year in question begins).

(b)       For purposes of this section:

(i)        an "employee" is any individual (other than an individual who is a nonresident alien who receives no earned income (within the meaning of Code section 911(d)(2)) from an Affiliated Organization that constitutes income from sources within the United States (within the meaning of Code section 861(a)(3))) who, during the Plan Year for which the determination is being made, performs services for an Affiliated Organization as

(1)            a common-law employee, (2)            an employee pursuant to Code section 401(c)(1) or (3)            a Leased Employee; and

(ii)       "compensation" for any period means an employee's Section 415 Wages for the period. 

(iii)      A former employee of an Affiliated Organization shall be treated as a former Highly Compensated Employee of the Affiliated Organization if the former employee was a Highly Compensated Employee of the Affiliated Organization when the former employee incurred a Termination of Employment or the former employee was a Highly Compensated Employee of the Affiliated Organization at any time after attaining age 55.  The determination of who is a former Highly Compensated Employee is based on the rules applicable to determining Highly Compensated Employee status as in effect for that determination year in accordance with Section 1.414(q)-1T, Q&A-4 of the Temporary Income Tax Regulations and Notice 97-45 or later guidance under the Code.

Hour of Active Service.  An "Hour of Active Service" is an hour for which the Employee is paid, or entitled to payment, for the performance of duties for an Affiliated Organization.

Hour of Service. An "Hour of Service" shall have the meaning assigned to it in Section 10.5.

Leased Employee.  A "Leased Employee" is any individual (other than an Employee) who provides services for an Affiliated Organization (or for an Affiliated Organization and "related persons" within the meaning of Code section 144(a)(3)):

(a)       pursuant to an agreement between an Affiliated Organization and any other person;

(b)       under the Affiliated Organization's primary direction and control; and

(c)       on a substantially full-time basis for a period of at least one year.

Matching Contribution Account.  The "Matching Contribution Account" is the account established pursuant to Section 4.1(a)(iii).

Matching Contributions.  "Matching Contributions" means contributions made by the Participating Employers on behalf of Participants pursuant to Section 3.3 or 3.6.

Normal Retirement Date.  The "Normal Retirement Date" of a Participant is the date on which he or she attains age 65.

One-Year Break in Service.  "One-Year Break in Service" is defined in Section 10.2.

Participant.  A "Participant" is a current or former Qualified Employee who has entered the Plan pursuant to the provisions of Article 2 and who has not ceased to be a Participant pursuant to the provisions of Section 2.8.

Participating Business Unit.  A "Participating Business Unit" is a division, work location or other operational unit of a Participating Employer, the eligible employees of which have been designated by the Participating Employer to participate in the Plan, as communicated in writing to the Company by the Participating Employer's Board.

Participating Employer.  A "Participating Employer" is the Company and any other Affiliated Organization that has adopted the Plan, or all of them collectively, as the context requires, and their respective successors.  An Affiliated Organization will cease to be a Participating Employer upon a termination of the Plan as to its Qualified Employees or upon its ceasing to be an Affiliated Organization.

Plan.  The "Plan" is that set forth in this instrument as it may be amended from time to time.  

Plan Rule.  A "Plan Rule" is a rule, policy, practice or procedure adopted by the Administrator. 

Plan Year.  A "Plan Year" is the 12-month period beginning on each January 1 and ending on the first following December 31.

Profit Sharing Contribution Account.  The "Profit Sharing Contribution Account" is the account established pursuant to Section 4.1(a)(iv).

Profit Sharing Contributions.  "Profit Sharing Contributions" means contributions made by the Participating Employers on behalf of Participants pursuant to Section 3.4 or 3.6.

Profit Sharing Plan Rollover Account.  The "Profit Sharing Plan Rollover Account" is the account established pursuant to Section 4.1(a)(vi).

Qualified Employee.  

(a)       Except as provided in Subsection (b), a "Qualified Employee" is an Employee who

(i)        performs services for a Participating Business Unit as an employee of a Participating Employer (as classified by the Participating Employer at the time the services are performed without regard to any subsequent reclassification); or

(ii)       is paid by a Participating Employer on a United States payroll while on a temporary foreign assignment as an employee of P.T. Vision-Ease Asia.

(b)       An Employee who would otherwise be a Qualified Employee is not a Qualified Employee if he or she:

(i)        is a nonresident alien who receives no earned income (within the meaning of Code section 911(d)(2) from a Participating Employer that constitutes income from sources within the United States (within the meaning of Code section 861(a)(3)); or

(ii)       is covered by a collective bargaining agreement, for whom retirement benefits were the subject of good faith bargaining between such person's representative and a Participating Employer, and is not, as a result of such bargaining, specifically covered by this Plan; or

(iii)      is working in the United States on a temporary foreign assignment; or

(iv)      is a Leased Employee.

(c)       An individual who is classified by a Participating Employer as an independent contractor, Leased Employee or as any other status in which the individual is not classified by the Participating Employer as a common-law employee of the Participating Employer at the time services are performed is not a Qualified Employee.  No judicial or administrative reclassification, or reclassification by the Participating Employer, will be applied to grant retroactive eligibility to any individual under the Plan.

Restatement Date.  The "Restatement Date" of the Plan is January 1, 2001, or such earlier date as specified in the Addendum.

Rollover Account.  The "Rollover Account" is the account established pursuant to Section 4.1(a)(v).

Section 415 Wages. 

(a)       An individual's "Section 415 Wages" for any period is his or her "compensation," within the meaning of Code section 415(c)(3) and Treasury Regulations thereunder, for the period from all Affiliated Organizations.

(b)       The Administrator may, for any period, determine the items of remuneration that, in accordance with Treasury Regulations, will be included in Section 415 Wages for such period; provided that for each purpose under this Plan, the Administrator's determination will be uniform throughout any period.

(c)       An individual's "Section 415 Wages" for any period shall include elective contribution pursuant to a qualified cash or deferred arrangement, otherwise payable to the individual by an Affiliated Organization, and other amount that are not includible in the individual's gross income by reason of Code section 125, 132(f)(4) or 457.

Termination of Employment.

(a)       For purposes of the Plan, a Participant will be deemed to have terminated employment only if he or she has completely severed his or her employment relationship with all Affiliated Organizations or become Disabled.  Neither transfer of employment among Affiliated Organizations nor absence from active service by reason of disability leave, other than in connection with a Participant becoming Disabled, or any other leave of absence will constitute a Termination of Employment.

(b)       A Participant will be deemed to have terminated employment in conjunction with the disposition of all or any portion of the business operation of an Affiliated Organization which is a disposition of a subsidiary or of substantially all of the assets used in a trade or business of an Affiliated Organization within the meaning of Code section 401(k)(10)(A) with respect to which the requirements of Code section 401(k)(10)(B) and (C) are satisfied.

(c)       A Participant who, in conjunction with the disposition of all or any portion of a business operation of an Affiliated Organization which is not described in Subsection (b), transfers employment to the acquirer of such business operation or to any affiliate of such acquirer will not be considered to have terminated employment.  If a Participant is deemed to have continued employment by reason of the preceding sentence, such sentence will continue to apply to such Participant in the event of any subsequent transfer of employment in conjunction with the disposition of all or any portion of a business operation of the initial acquirer or any subsequent acquirers which is not a disposition of a subsidiary of such acquirer or of substantially all of the assets used in a trade or business of such acquirer within the meaning of Code section 401(k)(10)(A) with respect to which the requirements of Code section 401(k)(10)(B) and (C) are satisfied.  Except in conjunction with such a disposition of a subsidiary or substantially all of the assets used in a trade or business of the seller, such a Participant will be considered to have terminated employment only when he or she has severed the employment relationship with all such acquirers and their affiliates.

Testing Wages. 

(a)       An individual's "Testing Wages" for any Plan Year is his or her Section 415 Wages for the Plan Year.

(b)       Notwithstanding Subsection (a), in no event will a person's Testing Wages for any Plan Year be taken into account to the extent it exceeds $150,000 (or such other larger amount as may be permitted for the calendar year during which such Plan Year begins under Code section 401(a)(17)).

(c)       The Administrator may, for any Plan Year, adopt any alternative definition of Testing Wages that complies with Code section 414(s) and Treasury Regulations thereunder; provided, that for each purpose under this Plan, the definition so adopted will be uniform throughout any Plan Year.

Treasury Regulations.  "Treasury Regulations" mean regulations, rulings, notices and other promulgations issued under the authority of the Secretary of the Treasury that apply to, or may be relied upon in the administration of, this Plan.

Trust.  The "Trust" is that created for purposes of implementing benefits under the Plan.

Trustee.  The "Trustee" is the corporation and/or individual or individuals who from time to time is or are the duly appointed and acting trustee or trustees of the Trust.

Vesting Service.  "Vesting Service" is defined in Section 10.1.

 

BMC INDUSTRIES, INC.
SAVINGS AND PROFIT SHARING PLAN

2001 Revision

ADDENDUM

SPECIAL EFFECTIVE DATES

The following Plan provisions are effective prior to the Restatement Date:

Definitions

Effective on or after January 1, 2000, the definition of "Eligible Earnings" in Section 14.2 of the Plan shall include elective amounts that are not includible in the gross income of the Employee by reason of Code section 132(f)(4).

The definition of "Eligible Rollover Distribution" in Section 14.2 of the Plan is effective for Plan Years beginning on or after January 1, 1999.

The definition of "Highly Compensated Employee" in Section 14.2 of the Plan is effective for Plan Years beginning on or after January 1, 1997.

The definition of "Leased Employee" in Section 14.2 of the Plan is effective for Plan Years beginning on or after January 1, 1997.

The definition of "Section 415 Wages" in Section 14.2 of the Plan is generally effective for Plan Years beginning on and after January 1, 1998.  Effective for Plan Years beginning on and after January 1, 2001, the definition of "Section 415 Wages" shall include elective amounts that are not includable in the gross income of the Employee by reason of Code section 132(f)(4).

ADP/ACP Testing

The actual deferral percentage test under Section 9.2(a)(i) and the actual contribution percentage test under Section 9.3(a)(i). were applied using the prior year testing methodfor the following Plan Years:  1999 and 2000. 

Sections 9.2(d) and 9.3(c) of the Plan regarding return of excess elective contributions and excess matching contributions are effective as of January 1, 1997.

Sections 9.2(f) and 9.3(e) of the Plan regarding the nondiscrimination early participation rule is effective as of January 1, 1999. 

Distributions

Effective on and after September 1, 1998, the "required beginning date" and timing of distribution election discussed in Section 8.1 of the Plan was changed for non-5-percent owners to April 1 following the later of (i) the year in which the Employee attains age 701/2 and (ii) the year in which the Employee incurs a Termination of Employment.

As of October 17, 2000, the cash-out limit in Section 8.1(a)(i) of the Plan shall be applied as of the date on which the distribution is made, regardless of the prior balance of the Participant's Account.

Highly Compensated Employees Determinations

Look Back Year Elections.  Prior to the Restatement Date, the Plan was administered in accordance with the following look back year election:

12-consecutive month period immediately preceding the Plan Year for the 1997, 1998, 1999 and 2000 Plan Years.

EX-10.3 4 exhibit_10-3.htm

BMC INDUSTRIES, INC.

SAVINGS AND PROFIT SHARING PLAN

2001 REVISION

First Declaration of Amendment

Pursuant to the retained power of amendment contained in Section 11.2 of the BMC Industries, Inc. Savings and Profit Sharing Plan - 2001 Revision, the undersigned hereby amends the Plan by adding a new Exhibit A thereto in the form attached hereto.

The foregoing amendment is effective as of December 31, 2001.

IN WITNESS WHEREOF, the undersigned has caused this instrument to be executed this 26th day of December, 2001.

                                                                                    BMC INDUSTRIES, INC.

Attest:  /s/Jon A. Dobson                                            By:  /s/Bradley D. Carlson

            Secretary                                                         Its:  Treasurer

BMC INDUSTRIES, INC.

SAVINGS AND PROFIT SHARING PLAN

2001 REVISION

EXHIBIT A

Special Provisions Applicable to

Vision-Ease Lens Azusa, Inc. and Buckbee-Mears Cortland in 2001

Pursuant to Section 14.1(f), this Exhibit A sets forth special provisions of the Plan applicable only to an Active Participant in the Plan who is a Qualified Employee of Vision-Eae Lens Azusa, Inc. or Buckbee-Mears Cortland, a unit of BMC Industries, Inc. and classified by the Participating Employer as being on an unpaid leave of absence on December 31, 2001 (a "Vision-Ease Lens Azusa/Buckbee-Mears Cortland Participant").

1. Notwithstanding Section 3.3(a)(i), a Vision-Ease Lens Azusa/Buckbee-Mears Cortland Participant will be eligible to share in the Participating Employer's Matching Contribution for the calendar quarter ending on December 31, 2001 pursuant to the provisions set forth in Section 3.3(a).
   
   

2. Notwithstanding Section 3.3(b)(i), a Vision-Ease Lens Azusa/Buckbee-Mears Cortland Participant, will be eligible to share in the Participating Employer's Matching Contribution (if any) for the Plan Year ending on December 31, 2001 pursuant to the provisions set forth in Section 3.3(b).
   
   

3. Notwithstanding Section 3.4(b)(i), a Vision-Ease Lens Azusa/Buckbee-Mears Cortland Participant who completed at least 1000 Hours of Service during the Plan Year ending on December 31, 2001, will be eligible to share in the Participating Employer's Profit Sharing Contribution for the Plan Year ending on December 31, 2001 pursuant to the provisions set forth in Section 3.4(b).

EX-10.4 5 exhibit_10-4.htm

BMC INDUSTRIES, INC.

SAVINGS AND PROFIT SHARING PLAN

2001 revision

Second Declaration of Amendment

Pursuant to the retained power of amendment contained in Section 11.2 of the BMC Industries, Inc. Savings and Profit Sharing Plan - 2001 Revision, the undersigned hereby amends the Plan as described below:

1.               Section 3.3 of the Plan is amended effective January 1, 2002, to read as follows:

"3.3     Matching Contributions. 

(a)       Subject to Subsections (b) and (d) and the limitations described in Article 9, the Participating Employer of an eligible Active Participant will make a Matching Contribution on behalf of the Active Participant for a calendar quarter in an amount equal to:

(i)        100 percent of the amount of the Active Participant's 401(k) Contributions for each calendar quarter up to three percent of the Participant's Eligible Earnings for such calendar quarter, and

(ii)       50 percent of the amount of the Active Participant's 401(k) Contributions for each calendar quarter that exceeds three percent of the Active Participant's Eligible Earnings for such calendar quarter and that does not exceed five percent of the Active Participant's Eligible Earnings for such calendar quarter.

It is intended that such Matching Contributions will be used by the Participating Employer to satisfy the safe harbor provisions of Code sections 401(k)(12) and 401(m)(11).

(b)       To be eligible to share in the Participating Employer's Matching Contribution for a given calendar quarter, a Participant must have, on or before the last day of the calendar quarter, entered the Plan as a Participant for the purposes of having Matching Contributions made on his or her behalf, received Eligible Earnings for the calendar quarter from the Participating Employer and made 401(k) Contributions.

(c)       A Participating Employer's Matching Contributions for a Plan Year will be paid to the Trustee on such date or dates during or following such Plan Year as the Participating Employer may elect but in no case more than 12 months after the end of the Plan Year.  A Participating Employer's Matching Contributions for a calendar quarter that are used to satisfy the safe harbor provisions of Code sections 401(k)(12) and 401(m)(11) will be paid to the Trustee no later than the last day of the following calendar quarter.

(d)       No Matching Contribution will be made with respect to any portion of a Participant's 401(k) Contributions returned to the Participant pursuant to Article 9.  For this purpose, 401(k) Contributions with respect to which no Matching Contributions are made for a Plan Year will be deemed to be the first such contributions returned to the Participant.  If the Administrator determines that Matching Contributions that have been added to a Participant's Account should not have been added by reason of this subsection, the contributions, increased by Fund earnings or decreased by Fund losses attributable to the contributions, as determined under Section 9.5, will be subtracted from the Account as soon as administratively practicable after the determination is made and will be applied to satisfy the contribution obligations of the Participating Employer that made the excess contributions for the Plan Year for which the excess contributions were made.  If, because of the passage of time, the excess cannot be applied in this way, the excess will be allocated, in the discretion of the Administrator:

(i)        among the Matching Contribution Accounts of all Participants who made 401(k) Contributions for the Plan Year as Qualified Employees of the Participating Employer in proportion to such 401(k) Contributions up to six percent of Eligible Earnings; or

(ii)       as a corrective contribution pursuant to Section 3.6.

(e)       Notwithstanding any other provision of this section to the contrary, a Participant covered by a collective bargaining agreement between his or her bargaining representative and a Participating Employer is eligible for Matching Contributions only if and to the extent provided in the collective bargaining agreement.

(f)        No Matching Contributions will be made with respect to After-Tax Contributions."

2.               Section 3.4(a) of the Plan is amended effective January 1, 2002, to read as follows:

"(a)      Each Participating Employer may make a Profit Sharing Contribution for a Plan Year on behalf of a Participant who has satisfied the eligibility conditions specified in Subsection (b) for a Plan Year in an amount (if any) equal to the sum of:

(i)        a percentage (if any) determined by the Participating Employer's Board for the Plan Year of the aggregate Eligible Earnings for the Plan Year of all Participants eligible to share in the contribution for the Plan Year plus

(ii)       an additional amount, if any, separately determined by the Participating Employer's Board for each of its Participating Business Units based on the annual profit performance of each Participating Business Unit."

3.               Section 3.4(c) of the Plan is amended effective January 1, 2002, to read as follows:

"(c)      Subject to the limitations described in Article 9, a Participating Employer's Profit Sharing Contribution for a Plan Year will be allocated among the Profit Sharing Contribution Accounts of Participants who have satisfied the eligibility conditions under Subsection (b) for the Plan Year as follows:

(i)        The Participating Employer's contribution described in Subsection (a)(i) will be allocated to each eligible Participant as follows:

(1)       a dollar amount equal to 5.7% of the sum of each Participant's Eligible Earnings plus his or her Excess Eligible Earnings; or

(2)       if the Employer contribution is less than the amount in Clause (1) above, then each eligible Participant will be allocated a share of the Participating Employer's Profit Sharing Contribution in the same proportion that the sum of such Participant's Eligible Earnings plus his or her Excess Eligible Earnings for the Plan Year bears to the sum of the Eligible Earnings plus Excess Eligible Earnings of all such eligible Participants; or

(3)       any remaining contribution will be allocated among eligible Participants in the same proportion that each Participant's Eligible Earnings for the Plan Year bears to the total amount of all eligible Participants' Eligible Earnings for that Plan Year.

(ii)       The Participating Employer's contribution described in Subsection (a)(ii) with respect to a given Participating Business Unit will be allocated to each eligible Participant who received Eligible Earnings for the Plan Year with respect to services for the Participating Business Unit (other than administrative services with respect to which he or she is included in the Corporate Participating Business Unit unless the contribution relates to the Corporate Participating Business Unit) in the same manner as under Subsection (c)(i) provided the allocations under this Subsection (c)(ii) are determined after aggregating the contributions allocated under (c)(i) to those participants who are eligible to receive an allocation under this Subsection (c)(ii) and the contributions to be allocated hereunder."

4.               Section 4.1(a)(iii) of the Plan is amended effective January 1, 2002, to read as follows:

"(iii)    A Matching Contribution Account, which will include the balance of his or her employer contribution account under prior provisions of the Plan and to which there will be added any Matching Contributions made on the Participant's behalf, together with a subaccount established and maintained for a Participant in connection with any Matching Contributions made pursuant to Section 3.3(a) that are used to satisfy the designed-based safe harbor alternative described in Code section 401(k)(12) and/or the designed-based safe harbor alternative described in Code section 401(m)(11), as provided under Sections 9.2, 9.3, and 9.4;"

5.               Section 5.1 of the Plan is amended effective February 1, 2002, to read as follows:

"5.1     Establishment of Investment Funds.

(a)       In order to allow each Participant to determine the manner in which his or her Accounts will be invested, the Trustee will maintain, within the Trust, an investment fund designated as the BMC Common Stock Fund and three or more separate investment funds of such nature and possessing such characteristics as the Committee may specify from time to time.  Subject to Section 5.4(b), each Participant's Accounts will be invested in the investment funds in the proportions directed by the Participant in accordance with the procedures set forth in Sections 5.2 and 5.3.  The Committee may, from time to time, direct the Trustee to establish additional investment funds or to terminate any existing investment fund.

(b)       Notwithstanding any other provision of the Plan to the contrary, the Committee may direct the Trustee to suspend Participant investment activity (including such activity in connection with the withdrawals, loans and distributions) in any or all investment funds, or impose special rules or restrictions of uniform application, for a period determined by the Committee to be necessary in connection with:

(i)        the establishment or termination of any investment fund;

(ii)       the receipt by the Trustee from, or transfer by the Trustee to, another trust of account balances in connection with an acquisition or divestiture or otherwise;

(iii)      a change of Trustee, investment manager or recordkeeper; or

(iv)      such other circumstances determined by the Committee as making such suspension or special rules or restrictions necessary or appropriate."

6.               Section 5.4 of the Plan is amended effective February 1, 2002, to read as follows:

"5.4     BMC Common Stock Fund.

(a)       The Trustee will establish, as one of the investment funds under Section 5.1, a fund, designated as the BMC Common Stock Fund, which will be invested in shares of Company Stock except for such amounts of cash as the Committee determines to be necessary to satisfy short-term liquidity requirements and cash held pending acquisition of shares of Company Stock.

(b)       Subject to Subsection (c), all amounts credited to a Participant's Matching Contribution Account prior to January 1, 2002 will be invested only in the BMC Common Stock Fund.

(c)       Notwithstanding Subsection (b) -

(i)        Not more than once each calendar quarter, a Participant who has attained age 55 may elect to transfer all or any portion of his or her Matching Contribution Account from the BMC Common Stock Fund to one or more of the investment funds maintained pursuant to Section 5.1 other than the BMC Common Stock Fund.  The election must be made in accordance with and is subject to Plan Rules and will be effective as soon as administratively practicable after it is received by the Administrator or the Administrator's designate.

(ii)       Not more than once each calendar quarter, a Participant who is an Employee and is not eligible to make directions pursuant to Subsection (c)(i) may elect to transfer up to 25 percent of his or her Matching Contribution Account from the BMC Common Stock Fund to one or more of the investment funds maintained pursuant to Section 5.1 other than the BMC Common Stock Fund.  A Participant may only make an election pursuant to this Subsection (c)(ii) if the portion of the  Participant's Matching Contribution Account, excluding the Matching Contribution subaccount established pursuant to Section 4.1(a)(iii),invested in the BMC Common Stock Fund equals or exceeds 20 percent of the aggregate balance of the Participant's 401(k) Contribution Account, Matching Contribution Account, After-Tax Contribution Account and Rollover Account.  The election must be made in accordance with and is subject to Plan Rules and will be effective as soon as administratively practicable after it is received by the Administrator or the Administrator's designate.

(d)       The BMC Qualified Benefits Plan Committee will direct the manner in which the shares of Company Stock represented by Participants' interests in the BMC Common Stock Fund will be voted in connection with any action at which holders of Company Stock are entitled to vote.  In the event of a public tender or exchange offer for shares of Company Stock, the BMC Qualified Benefits Plan Committee will direct whether or not the shares of Company Stock represented by the Participants' interests in the BMC Common Stock Fund will be tendered or exchanged.

(e)       A Participant who is subject to the reporting requirements of section 16 of the Securities Exchange Act of 1934 (the "Exchange Act") with respect to Company Stock may elect to make a transfer pursuant to Section 5.3, a withdrawal or plan loan pursuant to Article 6, a distribution pursuant to Article 8or any other "discretionary transaction," as that term is defined under the Exchange Act, from the portion of his or her Account invested in Company Stock only if both of the following conditions are satisfied.

(i)        The election to make such transfer or application for the withdrawal or distribution must be made within the period between the third and twelfth days, inclusive, following the Company's release of its quarterly or annual financial data in the manner described in Rule 16b-3(e)(1)(ii) of the Exchange Act.  Such election or application will be given effect at the same time as would other elections or applications made at the same time.

(ii)       Such Participant has not made any election to transfer any portion of his or her Account balance from Company Stock or received a withdrawal or distribution from the portion of his or her Account invested in Company Stock within the six-month period immediately preceding the date on which such election is made."

7.               Section 7.1 of the Plan is amended effective January 1, 2002, to read as follows:

"7.1     Vesting. 

(a)       A Participant always has a fully vested nonforfeitable interest in his or her 401(k) Contribution Account, After-Tax Contribution Account, Matching Contribution Account, Rollover Account, Profit Sharing Plan Rollover Account and in the portion of his or her Profit Sharing Contribution Account credited to a subaccount described in Section 3.6.

(b)       A Participant will acquire a fully vested nonforfeitable interest in the portion of his or her Profit Sharing Contribution Account not described in Subsection (a) upon attaining his or her Normal Retirement Date while he or she is, or before he or she became, an Employee.

(c)       A Participant will acquire a fully vested nonforfeitable interest in the portion of his Profit Sharing Contribution Account not described in Subsection (a) if he or she dies or becomes Disabled while he or she is an Employee.

(d)       A Participant will acquire a fully vested nonforfeitable interest in the portion of his or her Profit Sharing Account not described in Subsection (a) upon the Participant's Termination of Employment following the Participant's attainment of age 60 if the sum of his or her age and full years of Vesting Service is at least 65.

(e)       A Participant will acquire a fully vested nonforfeitable interest in the portion of his or her Profit Sharing Contribution Account not described in Subsection (a) if the Affiliated Organization, Participating Business Unit, business unit, location or division at which the Participant is employed, permanently ceases operations or is sold or otherwise transferred through sale of stock or of business and assets, in such manner that it no longer is, or is no longer owned by, an Affiliated Organization.

(f)        A Participant will acquire a fully vested nonforfeitable interest in the portion of his or her Profit Sharing Contribution Account not described in Subsection (a) upon a Change in Control with respect to the Company, which for purposes of this subsection means any of the following:

(i)        The sale, lease, exchange, or other transfer of all or substantially all of the assets of the Company, in one transaction or in a series of related transactions, to any Person;

(ii)       The approval by the stock holders of the Company of any plan or proposal for the liquidation or dissolution of the Company;

(iii)      Any Person is or becomes the "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of 50 percent or more of the combined voting power of the Company's outstanding securities ordinarily having the right to vote at elections of directors;

(iv)      Individuals who constitute the Company's Board of Directors on January 1, 1998 (the "Incumbent Board") cease for any reason to constitute at least a majority thereof, provided that any person becoming a director subsequent to January 1, 1998 whose election, or nomination for election, by the Company's stockholders, was approved by a vote of at least a majority of the directors comprising the Incumbent Board (either by a specific vote or by approval of the proxy statement of the Company in which such person is named as a nominee for director, without objection to such nomination) will, for purposes of this clause (iv), be deemed to be a member of the Incumbent Board; or

(v)       A change in control of a nature that is determined by independent legal counsel to the Company to be required to be reported (assuming such event has not been "previously reported") in response to Item 1(a) of the Current Report on Form 8-K, as in effect on January 1, 1994, pursuant to section 13 or 15(d) of the Exchange Act, whether or not the Company is then subject to such reporting requirement.

For purposes of applying the foregoing, the term "Person" means and includes any individual, corporation, partnership, group, association or other "person," as such term is used in section 14(d) of the Exchange Act, other than the Company, a wholly-owned subsidiary of the Company or any employee benefit plan(s) sponsored by the Company or a wholly-owned subsidiary of the Company.

(g)       A Participant whose Profit Sharing Contribution Account is not otherwise fully vested will acquire a vested nonforfeitable interest in the portion of his or her Profit Sharing Contribution Account not described in Subsection (a) to the extent provided in the following schedule:

Full Years of Vesting Service   Less than Five Years
Five or More Years Vested
Interest

  0%
100 %"

8.               Section 7.2 of the Plan is amended effective January 1, 2002, to read as follows:

"7.2     Forfeiture Upon Distribution.

(a)       If a Participant receives a distribution of the entire vested balance of his or her Accounts after Termination of Employment and before he or she incurs five consecutive One-Year Breaks in Service, the nonvested portions of the Participant's Profit Sharing Contribution Account will, at the time of such distribution, be forfeited.  A Participant who has no vested interest in his or her Profit Sharing Contribution Account when he or she terminates employment will be deemed to have received a distribution of the entire vested balance of the Account at the time of his or her Termination of Employment.

(b)       If a Participant described in Subsection (a) received a distribution of less than the entire balance of his or her Accounts, resumes employment as a Qualified Employee and repays to the Trustee the full amount distributed, other than the portion of the distribution attributable to his or her After-Tax Contribution Account, Rollover Account and Profit Sharing Plan Rollover Account balances, before the earlier of (1) five years following the date of reemployment as a Qualified Employee or (2) the date on which he or she incurs five consecutive One-Year Breaks in Service following the distribution, then, the amount of any forfeitures will be restored to the Participant's Profit Sharing Contribution Account, unadjusted for interest or any change in value occurring after the distribution.  Such restoration will be made from forfeitures that arise for the Plan Year for which such restoration is to be made.  To the extent such forfeitures are insufficient for such purpose, the Participating Employer with whom the Participant was last employed as a Qualified Employee will contribute the amount required to restore the Account.  A Participant described in the last sentence of Subsection (a) who is reemployed before incurring five consecutive One-Year Breaks in Service following the date of his or her Termination of Employment will be deemed to have repaid his or her deemed distribution upon his or her reemployment as a Qualified Employee."

9.               Section 7.3 of the Plan is amended effective January 1, 2002, to read as follows:

"7.3     Other Forfeitures.

(a)       Except as provided in Section 7.2, the nonvested portions of a Participant's Profit Sharing Contribution Account will continue to be held in a separate subaccount of such Account until the Participant incurs five consecutive One-Year Breaks in Service, at which time the subaccount balance will be forfeited.  If the Participant resumes employment with an Affiliated Organization prior to incurring five consecutive One-Year Breaks in Service, such subaccount will be disregarded and its balance will be included in the Profit Sharing Contribution Account.

(b)       A Participant's vested interest in his or her Profit Sharing Contribution Account balance following a resumption of employment in accordance with Subsection (a) at any given time will not be less than the amount "X" determined by the formula: X = P(AB + (R x D)) - (R x D), where P is the Participant's vested percentage at the time of determination; AB is the Account balance at the time of determination; D is the amount of the distribution; and R is the ratio of the Account balance at the time of determination, to the subaccount balance immediately following the distribution."

10.            Section 8.1(a)(v) of the Plan is amended effective February 1, 2002, to read as follows:

"(v)      All distributions will be made in the form of a check drawn on the Trust and, if applicable, a canceled note evidencing any Plan loan; provided, that if the vested portion of the Account balance of a Participant or Beneficiary of a deceased Participant is credited with the equivalent of at least 10 full shares of Company Stock, at the election of the Participant or Beneficiary, distribution of the vested portion of the Account balance invested in the BMC Common Stock Fund may be distributed in full shares of Company Stock and cash in lieu of any fractional share."

11.            Section 9.2(a) of the Plan is amended effective January 1, 2002, to read as follows:

"(a)      For each Plan Year that the designed-based safe harbor alternative described in Code section 401(k)(12) has not been satisfied, the Plan must satisfy the requirements of Code section 401(k)(3)."

12.            Section 9.2 of the Plan is amended effective January 1, 2002, by adding a new Subsection (g) that reads as follows:

"(g)      It is intended that the Plan will satisfy the design-based safe harbor alternative described in Code section 401(k)(12) to satisfy the Code section 401(k) nondiscrimination test."

13.            Section 9.3(a) of the Plan is amended effective January 1, 2002, to read as follows:

"(a)      For each Plan Year that the designed-based safe harbor alternative described in Code section 401(m)(11) has not been satisfied, the Plan must satisfy the requirements of Code section 401(m)(2)."

14.            Section 9.3 of the Plan is amended effective January 1, 2002, by adding a new Subsection (g) that reads as follows:

"(g)      It is intended that the Plan will satisfy the design-based safe harbor alternative described in Code section 401(m)(11) to satisfy the Code section 401(m) nondiscrimination test.  Notwithstanding the foregoing, After-Tax Contributions made by Participants will satisfy the nondiscrimination tests described in Section 9.3(a)."

IN WITNESS WHEREOF, the undersigned has caused this instrument to be executed this 26th day of December, 2001.

                                                                                    BMC INDUSTRIES, INC.

Attest:/s/Jon A. Dobson                                                By:  /s/Bradley D. Carlson

            Secretary                                                          Its: Treasurer

EX-10.5 6 exhibit_10-5.htm

BMC INDUSTRIES, INC.

SAVINGS AND PROFIT SHARING PLAN

2001 REVISION

Third Declaration of Amendment

Pursuant to the retained power of amendment contained in Section 11.2 of the BMC Industries, Inc. Savings and Profit Sharing Plan - 2001 Revision, the Plan is amended in the manner set forth below to reflect certain provisions of the Economic Growth and Tax Relief Reconciliation Act of 2001 ("EGTRRA").  This amendment is intended as good faith compliance with the requirements of EGTRRA and is to be construed in accordance with EGTRRA and Treasury Regulations.  Except as this amendment provides otherwise, this amendment will be effective as of January 1, 2002.  This amendment will supersede the provisions of the Plan to the extent those provisions are inconsistent with the provisions of this amendment.

1)     Effective for limitation years beginning after December 31, 2001, the aggregate annual additions that may be contributed or allocated to a Participant's account under the Plan for any Plan Year will not exceed the lesser of:

(a)   $40,000, as adjusted for increases in the cost-of-living under Code section 415(d), or

(b)  100 percent of the Participant's Section 415 Wages for the Plan Year.  The compensation limit referred to in this clause (b) will not apply to any contribution for medical benefits after separation from service (within the meaning of Code sections 401(h) or 419A(f)(2)) that is otherwise treated as an annual addition.

2)     The Eligible earnings and Testing Wages of a Participant taken into account for any Plan Year beginning after December 31, 2001, will not exceed $200,000, as adjusted for cost-of-living increases in accordance with Code section 401(a)(17)(B).  The cost-of-living adjustment in effect for a calendar year applies to Eligible Earnings and Testing Wages for the determination period that begins with or within such calendar year.

3)     The term "key employee" means any employee or former employee (including any deceased employee) who, at any time during the Plan Year that includes the determination date, was an officer of an Affiliated Organization having annual compensation greater than $130,000 (as adjusted under Code section 416(i)(1) for Plan Years beginning after December 31, 2002), a 5-percent owner of the Affiliated Organization, or a 1-percent owner of the Affiliated Organization having annual compensation of more than $150,000.  For this purpose annual compensation means compensation within the meaning of Code section 415(c)(3).  The determination of key employees will be made in accordance with Code section 416(i)(1) of the Code and Treasury Regulations.

4)     In determining if the Plan is a top-heavy plan, the present values of accrued benefits and the amounts of account balances of an employee as of the determination date will be increased by the distributions made with respect to the employee under the Plan and any plan aggregated with the Plan under Code section 416(g)(2) during the 1-year period ending on the determination date.  The preceding sentence will also apply to distributions under a termination plan which, had it not been terminated, would have been aggregated with the Plan under Code section 416(g)(2)(A)(i).  If a distribution is made for a reason other than separation from service, death, or disability, this provision will be applied by substituting "5-year period" for "1-year period."  The accrued benefits and accounts of any individual who has not performed services for the Affiliated Organization during the 1-year period ending on the determination date will not be taken into account.

5)     If the Plan is a top-heavy plan, Matching Contributions will be taken into account for purposes of satisfying the minimum contribution requirements of Code section 416(c)(2) and the Plan.  The preceding sentence will apply with respect to Matching Contributions under the Plan or, if the Plan provides that the minimum contribution requirement will be met in another plan, such other plan.  Matching Contributions that are used to satisfy the minimum contribution requirements will be treated as matching contributions for purposes of the actual contribution percentage test and other requirements of Code section 401(m).

6)     Effective for distributions made after December 31, 2001, for purposes of the direct rollover provisions in Section 8.7, an eligible retirement plan will also mean an annuity contract described in Code section 403(b) and an eligible plan under Code section 457(b) that is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state and that agrees to separately account for amounts transferred into such plan from this Plan.  The definition of eligible retirement plan will also apply in the case of a distribution to a surviving spouse, or to a spouse or former spouse who is the alternate payee under a qualified domestic relation order, as defined in Code section 414(p).  No amount that is distributed on account of hardship will be an eligible rollover distribution, and the distribute may not elect to have any portion of such a distribution paid directly to an eligible retirement plan.

7)     A portion of a distribution will not fail to be an Eligible Rollover Distribution merely because the portion consists of After-Tax Contributions that are not includible in gross income.  However, such portion may be transferred only to an individual retirement account or annuity described in section 408(a) or (b) of the Code or to a qualified defined  contribution plan described in section 401(a) or 403(a) of the Code that agrees to separately account for amounts so transferred, including separately accounting for the portion of such distribution that is includible in gross income and the portion of such distribution that is not so includible.

8)     The plan will accept Rollover contributions of Eligible Rollover Distributions made after December 31, 2001, from:

(a)   a qualified plan described in Code section 401(a) or 403(a), excluding after-tax employee contributions;

(b)  an annuity contract described in Code section 403(b), excluding after-tax employee contributions; or

(c)   an eligible plan under Code section 457(b) that is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state.

9)     The Plan will not accept a participant rollover contribution of the portion of a distribution from an individual retirement account or annuity described in section 408(a) or 408(b) of the Code that is eligible to be rolled over and would otherwise be includible in gross income, other than such an account or annuity that is solely a conduit for distributions from a qualified retirement plan, excluding after-tax employee contributions.

10)For purposes of Section 8.1(a) (involuntary distribution of vested Accounts of $5,000 or less), the value of a Participant's no forfeitable Account balances will be determined without regard to that portion of the Account balances that is attributable to a Participant's Profit Sharing Plan Rollover Account and Rollover contributions (and earnings allocable thereto) within the meaning of sections 402(c), 403(a)(4), 403(b)(8), 408(d)(3)(A)(ii), and 457(e)(16) of the Code.

11)The multiple use test described in Treasury Regulation section 1.401(m)-2 and Section 9.4 will not apply.

12)The top-heavy requirements of Code section 416 and Section 13.3 will not apply in any year beginning after December 31, 2001, in which the Plan consists solely of a cash or deferred arrangement which meets the design-based safe harbor alternative requirements of Code section 401(k)(12) and Matching Contributions with respect to which the design-based safe harbor alternative requirements of Code section 401(m)(11) are met.

13)A Participant who receives a hardship withdrawal of 401(k) Contributions after December 31, 2001, will be prohibited from making 401(k) Contributions and After-Tax Contributions under this Plan and elective deferrals and after-tax employee contributions under any other plans maintained by any Affiliated Organization for 6 months after receipt of the hardship withdrawal.

14)A Participant's vested Account balances will become distributable following the Participant's severance from employment with all Affiliated Organizations.  Such a distribution will be subject to the other provisions of the Plan regarding distributions, other than provisions that require a separation from service before such amounts may be distributed.

IN WITNESS WHEREOF, the undersigned has caused this instrument to be executed this 31^st day of December, 2002.

                                                                                    BMC INDUSTRIES, INC.

Attest:  /s/Jon A. Dobson                                            by:  /s/Susan Linzmeier

            Secretary                                                         its: V.P. Human Resources

EX-10.26 7 exhibit_10-26.htm

BMC Buckbee-Mears St. Paul

A unit of BMC Industries, Inc.

278 East 7^th Street

St. Paul, MN 55101

(651) 228-6400 / (800)BMC-Etch

Fax (651) 228-6541

January 14, 2003

Mr. Henry Zaidan

President

GMT Corporation

245 E. Sixth Street

St. Paul, MN  55101-1918

Dear Henry,

Please accept this letter as official notice that Buckbee-Mears will terminate the lease for the PS-3 space on February 28, 2003.

Please contact me if you have any questions.

Sincerely,

/s/Dennis Malecek

Dennis Malacek

Director of Operations

651-228-6471

EX-10.47 8 exhibit_10-47.htm

THE SEVENTH RESTATED

GRAPHIC COMMUNICATIONS INTERNATIONAL UNION,

TWIN CITIES LOCAL 6A -

BUCKBEE-MEARS PENSION PLAN

Generally Effective January 1, 2001

TABLE OF CONTENTS

 NAME AND HISTORY OF PLAN........................................................................................... 1

    Section 1.1.................................................................................................................................. 1

ARTICLE II.................................................................................................................................... 1

    DEFINITIONS........................................................................................................................... 1

    Section 2.1.................................................................................................................................. 1

    Section 2.2 - Accrual Service...................................................................................................... 1

    Section 2.3 - Accrued Benefit...................................................................................................... 3

    Section 2.4 - Actuarial Equivalent................................................................................................ 4

    Section 2.5 - Actuary.................................................................................................................. 4

    Section 2.6 - Beneficiary.............................................................................................................. 4

    Section 2.7 - -  Break in Service.................................................................................................... 5

    Section 2.8 - Code...................................................................................................................... 5

    Section 2.9 - Collective Bargaining Agreement............................................................................. 5

    Section 2.10 - Company.............................................................................................................. 6

    Section 2.11 - Computation Periods............................................................................................ 6

    Section 2.12 - Effective Date....................................................................................................... 6

    Section 2.13 - Eligibility and Vesting Service................................................................................ 6

    Section 2.14 - Eligible Employee.................................................................................................. 7

    Section 2.15 - Employer.............................................................................................................. 8

    Section 2.16 - Employment Commencement Date........................................................................ 8

    Section 2.17 - ERISA................................................................................................................. 8

    Section 2.18 - Fiduciary.............................................................................................................. 8

    Section 2.19 - -  Former Plan......................................................................................................... 8

    Section 2.20 - Hours Worked..................................................................................................... 8

    Section 2.21 - Normal Retirement Date....................................................................................... 8

    Section 2.22 - Normal Retirement Age...................................................................................... 11

    Section 2.23 - PBGC................................................................................................................ 11

    Section 2.24 - Participant.......................................................................................................... 11

    Section 2.25 - Plan.................................................................................................................... 11

    Section 2.26 - Plan Administrator.............................................................................................. 11

    Section 2.27 - Plan Anniversary Date......................................................................................... 11

    Section 2.28 - Plan Year........................................................................................................... 11

    Section 2.29 - Re-Employment Commencement Date................................................................ 11

    Section 2.30 - Retirement Fund................................................................................................. 12

    Section 2.31 - Termination of Employment................................................................................. 12

    Section 2.32 - Trustees.............................................................................................................. 12

    Section 2.33 - Union................................................................................................................. 12

    Section 2.34- Vesting................................................................................................................ 12

ARTICLE III................................................................................................................................ 12

    EMPLOYEE PARTICIPATION.............................................................................................. 12

    Section 3.1 - Eligibility for Participation...................................................................................... 12

    Section 3.2 - Transfer to Eligible Employee Status...................................................................... 13

    Section 3.3 - Re-Employment after a Break in Service............................................................... 13

    Section 3.4 - Preservation of Pre-Break Service........................................................................ 13

ARTICLE IV................................................................................................................................ 14

    BENEFITS............................................................................................................................... 14

    Section 4.1 - Normal Retirement Benefit Formula....................................................................... 14

    Section 4.2 - Accrued Benefit.................................................................................................... 14

    Section 4.3 - Early Retirement Benefit........................................................................................ 14

    Section 4.4 - Benefit Upon Other Termination of Employment.................................................... 15

    Section 4.5 - Early Commencement of Benefits.......................................................................... 15

    Section 4.6 - Minimum Benefit................................................................................................... 16

    Section 4.7 - Benefits that Matured Prior to the Effective Date.................................................... 16

    Section 4.8 - Non-Duplication of Benefits.................................................................................. 16

    Section 4.9 - Optional Forms of Benefit Payments...................................................................... 16

    Section 4.10 - Qualified Joint and Survivor Annuity.................................................................... 17

    Section 4.11 - Pre-Retirement Spouse Annuity........................................................................... 18

    Section 4.12 - Payment of Small Amounts.................................................................................. 20

    Section 4.13 - No Other Benefits............................................................................................... 21

    Section 4.14 - Maximum Benefits.............................................................................................. 21

    Section 4.15 - Death Benefit...................................................................................................... 21

    Section 4.16 - Manner of Election - Revocation for Joint and Survivor Annuity -

    Normal Retirement Age............................................................................................................. 22

ARTICLE V.................................................................................................................................. 23

    PLAN FINANCING................................................................................................................ 23

    Section 5.1 - Contributions........................................................................................................ 23

ARTICLE VI................................................................................................................................ 23

    ACTUARY............................................................................................................................... 23

    Section 6.1 - Appointment and Duties........................................................................................ 23

    Section 6.2 - Successors........................................................................................................... 24

ARTICLE VII............................................................................................................................... 24

    ADMINISTRATION............................................................................................................... 24

    Section 7.1 - Allocation of Responsibility Among Fiduciaries for Plan and Retirement

    Fund Administration................................................................................................................... 24

    Section 7.2 - Facility of Payment................................................................................................ 24

    Section 7.3 - Discretionary Authority......................................................................................... 25

ARTICLE VIII............................................................................................................................. 25

    MISCELLANEOUS................................................................................................................. 25

    Section 8.1 - Non-Guarantee of Employment............................................................................. 25

    Section 8.2 - Rights to Retirement Fund Assets.......................................................................... 25

    Section 8.3 - Non-Alienation of Benefits.................................................................................... 25

    Section 8.4 - Distributions Under Domestic Relations Orders..................................................... 26

ARTICLE IX................................................................................................................................ 26

    AMENDMENTS...................................................................................................................... 26

    Section 9.1 - Amendment.......................................................................................................... 26

ARTICLE X.................................................................................................................................. 27

    SUCCESSOR COMPANY AND MERGER OR CONSOLIDATION OF PLANS............... 27

    Section 10.1 - Successor Company........................................................................................... 27

    Section 10.2 - Plan Assets......................................................................................................... 27

ARTICLE XI................................................................................................................................ 28

    TOP HEAVY PROVISIONS................................................................................................... 28

    Section 11.1 - Top Heavy Plan Requirements............................................................................ 28

    Section 11.2 - Determination of Top Heavy Status..................................................................... 28

    Section 11.3 - Vesting if a Portion of the Plan Becomes Top Heavy............................................ 33

    Section 11.4 - Minimum Benefit Requirement If a Portion of the Plan Becomes Top Heavy......... 34

ARTICLE XII............................................................................................................................... 35

ARTICLE XIII............................................................................................................................. 36

    PLAN TERMINATION........................................................................................................... 36

    Section 13.1 - Right to Terminate............................................................................................... 36

    Section 13.2 - Partial Termination.............................................................................................. 37

    Section 13.3 - Liquidation of Retirement Fund............................................................................ 37

    Section 13.4 - Manner of Distribution........................................................................................ 39

    Section 13.5 - Residual Amounts............................................................................................... 40

ARTICLE XIV.............................................................................................................................. 40

    CONSTRUCTION.................................................................................................................. 40

    Section 14.1 - Construction....................................................................................................... 40

    Section 14.2 - Authority of Trustees.......................................................................................... 40

ARTICLE I

NAME AND HISTORY OF PLAN

    Section 1.1 - THE GRAPHIC COMMUNICATIONS INTERNATIONAL UNION, TWIN CITIES LOCAL 6A - BUCKBEE-MEARS PENSION PLAN (formerly known as the Pension Plan of the Lithographers and Photoengravers International Union, Twin Cities Local 6A - Buckbee Mears Retirement Fund and more recently known as the Graphic Arts International Union, Twin Cities Local 6A - Buckbee-Mears Pension Plan) as set forth in the instrument dated the 27^th day of December 1968, amended January 1, 1975, restated January 1, 1976, amended and restated January 1, 1982, amended and restated January 1, 1984, amended and restated January 1, 1985, amended and restated January 1, 1989, and is hereby amended and restated in its entirety to be effective as of January 1, 2001.

ARTICLE II

DEFINITIONS

    Section 2.1 - All of the definitions contained in the Restated Agreement and Declaration of Trust of the GRAPHIC COMMUNICATIONS INTERNATIONAL UNION, TWIN CITIES LOCAL 6A - BUCKBEE-MEARS RETIREMENT FUND, formerly the Graphic Arts International Union, Twin Cities Local 6A - Buckbee Mears Retirement Fund, are incorporated into this Plan by reference.

    Section 2.2 - Accrual Service  The Accrual Service credited to a Participant will vary in accordance with the particular year in which such service was performed and the year in which said Participant's employment terminated.  Computations of Accrual Service shall include all Hours Worked by an Eligible Employee in an Accrual Computation Period.

(a)      For Participants who are laid off or who terminate employment with the Employer after December 31, 1984, Accrual Service after December 31, 1975 is accumulated at the rate of one (1) year for each Accrual Computation Period in which an Eligible Employee completes 1,800 or more Hours Worked.  If an Eligible Employee works at least 900 hours but less than 1,800 hours, he will be entitled to a fraction of one (1) year Accrual Service based upon the number of hours actually worked divided by 1,800 hours.  There will be no accumulation of Accrual Service for any complete Accrual Computation Period in which a Participant accumulates less than 900 Hours Worked.

(b)      For Participants who are laid off or who terminate employment with the Employer between January 1, 1981 and December 31, 1984, Accrual Service after December 31, 1975 is accumulated at the rate of one (1) year for each Accrual Computation Period in which an Eligible Employee completes 1,800 or more hours worked.  There will be no accumulation of Accrual Service for any complete Accrual Computation Period in which a Participant accumulates less than 975 hours.  If a Participant accumulates more than 975 hours, but less than 1,800 hours, he will be entitled to a fraction of one (1) year of Accrual Service based upon the number of hours actually worked divided by 1,950 hours.

(c)      In the case of a Participant who is laid off or terminates employment with the Employer    during the period from January 1, 1976 through December 1, 1980, an Eligible Employee shall have accumulated at least 975 hours during the computation period in order to receive any Accrual Service for that period.  An Eligible Employee working at least 975 hours but less than 1,950 hours in an Accrual Computation Period between January 1, 1976 and December 31, 1980, shall accrue a fraction of one (1) year of Accrual Service, the numerator being the number of hours actually worked and the denominator being 1,950 hours.

(d)      Accrual Service prior to January 1, 1976 shall be the service recognized for benefit accrual purposes under the terms of the Former Plan.  For each Plan Year from June 1, 1968 to May 31, 1975, service was accumulated as follows:

•         1 year of Accrual Service if at least 48 weekly payroll checks received from the Employer in a Plan Year.

•         3/4 of 1 year of Accrual Service if between 36 and 47 weekly payroll checks received from the Employer in a Plan Year.

•         ½ of 1 year of Accrual Service if between 24 and 35 weekly payroll checks received from the Employer in a Plan Year.

•         No credit if less than 24 weekly payroll checks received from the Employer in a Plan year.

(e)      For the short Plan Year June 1, 1975 to December 31, 1975, service was accumulated as follows:

•         58.33% of 1 year of Accrual Service if at least 28 weekly payroll checks received from the Employer in the Plan Year.

•         43.75% of 1 year of Accrual Service if between 21 and 27 weekly payroll checks received from the Employer in the Plan Year.

•         29.17% of 1 year of Accrual Service if between 14 and 20 weekly payroll checks received from the Employer in the Plan Year.

•         No credit if less than 14 weekly payroll checks received from the Employer in the Plan Year.

(f)       A Participant who retires on or after January 1, 1973 is entitled to a maximum of ten (10) Years of Service under this Plan for vesting and accrual purposes for employment with the Employer within the ten (10) years prior to June 1, 1968 provided that such service would otherwise qualify under the terms of this Plan.  For purposes of determining Accrual Service, years prior to June 1, 1968, shall be calculated pursuant to Section 2.2(d).

(g)      Service prior to June 1, 1958, shall not be counted for the purpose of calculating Accrual Service under this Plan.

    Section 2.3 - Accrued Benefit.  The Accrued Benefit for each Participant who on or after January 1, 2003:

(a)      terminates employment with the Employer:

(b)      is laid off; or

(c)      ceases being an Eligible Employee;

shall be $43.50 multiplied by the number of years of Accrual Service through December 31, 2001; plus, Hours Worked from January 1, 2002 through June 30, 2002 divided by 1800 hours multiplied by $43.50; plus, Hours Worked from July 1, 2002 through December 31, 2002 divided by 1800 multiplied by $21.75; plus $21.75 multiplied by the number of years of Accrual Service on or after January 1, 2003.  No Hours Worked in 2002 in excess of 1800 hours shall be included in these equations.  Pursuant to Section 2.2, there will be no accumulation of Accrual Service for any complete Accrual Computation Period in which a Participant accumulates less than 900 Hours Worked; in addition, if any Eligible Employee has less than 900 Hours Worked in the year 2002, he or she shall not be entitled to any benefit accrual for 2002.

    With respect to any Participant who terminated employment with the Employer or was laid off or ceased to be an Eligible Employee prior to January 1, 2003, the following Accrued Benefit shall be applicable for the following period of time:

2002                                      *

2001                                      $43.50 per year of Accrual Service

2000                                      $43.50 per year of Accrual Service

1999                                      $43.50 per year of Accrual Service

1998                                      $39.00 per year of Accrual Service

1997                                      $35.00 per year of Accrual Service

1996                                      $34.00 per year of Accrual Service

1995                                      $28.50 per year of Accrual Service

1991                                      $28.00 per year of Accrual Service

1990                                      $27.00 per year of Accrual Service

1989                                      $25.00 per year of Accrual Service

1988                                      $24.00 per year of Accrual Service

1987                                      $22.00 per year of Accrual Service

1986                                      $21.00 per year of Accrual Service

1985                                      $19.00 per year of Accrual Service

1984                                      $16.00 per year of Accrual Service

1983                                      $14.00 per year of Accrual Service

1982                                      $13.00 per year of Accrual Service

1981                                      $11.00 per year of Accrual Service

9/1/80 - 12/31/80                   $ 9.50 per year of Accrual Service, except for participants who terminated employment prior to 1/1/80.

*        $43.50 multiplied by the number of years of Accrual Service through December 31, 2001; plus, Hours Worked from January 1, 2002 through June 30, 2002 divided by 1800 hours multiplied by $43.50; plus, Hours Worked from July 1, 2002 through December 31, 2002 divided by 1800 multiplied by $21.75.  No Hours Worked in 2002 in excess of 1800 hours shall be included in these equations.  Pursuant to Section 2.2, there will be no accumulation of Accrual Service for any complete Accrual Computation Period in which a Participant accumulates less than 900 Hours Worked; in addition, if any Eligible Employee has less than 900 Hours  Worked  in the year 2002, he or she shall not be entitled to any benefit accrual for 2002.

    The Accrued Benefit of any Participant who terminated employment with the Employer on or before December 31, 1979 shall be the Accrued Benefit that was in effect in the Plan at the time of such termination.

    Section 2.4 -  Actuarial Equivalent.  In the event that a specific actuarial factor is not provided under this Plan, the appropriate actuarial equivalence factor shall be the actuarial factors issued by the Pension Benefit Guaranty Corporation for the first day of January of the year for which the actuarial equivalence is provided.  The factor shall use an average of the appropriate male and female factors.

    Section 2.5 -  Actuary.  The Actuary is the corporation, firm or individual appointed and acting from time to time pursuant to the terms of Article VI.

    Section 2.6 -  Beneficiary.  A Beneficiary is the person or persons, natural or otherwise, other than a joint or contingent annuitant, designated by a Participant to receive any benefit payable under the Plan in the event of his death.

    A Participant who has designated a Beneficiary may, without the consent of such Beneficiary, alter or revoke such designation.  However, the spouse of a Participant must consent to the naming of a Beneficiary other than himself or herself.  Such consent must be executed in the presence of a notary public.  To be effective, any Participant's designation, alteration, or revocation of a Beneficiary shall be in writing, in such form as the Trustees may prescribe, and shall be filed with the Trustees prior to the death of the Participant.  If, at the time a death benefit becomes payable, there is not on file with the Trustees a fully executed designation of Beneficiary with spousal consent where required, then the designated Beneficiary shall be the person or persons surviving him in the first of the following classes in which there is a survivor, share and share alike:

(a)      his spouse;

(b)      his children, except that if any of his children predecease him but leave issue surviving him, such issue shall take by right of representation the share their parent would have taken if living;

(c)      his parents;

(d)      his brothers and sisters;

(e)      his personal representative or representatives (executors and administrators).

The identity of each Beneficiary in each case shall be determined by the Trustees.  Each such determination shall be final and binding for all persons.  Should the Plan Administrator not have a valid consent by a spouse to the designation by a Participant of a Beneficiary other than the spouse, the Trustees will pay a Participant's benefits to the spouse.

    Section 2.7 -  Break in Service.  A Break in Service occurs only when an Eligible Employee receives no compensation and no vesting credit during a Vesting Computation Period.  Such compensation shall include direct and indirect compensation by the Employer for Hours Worked including sick pay, vacation pay, pay during a leave of absence, disability income, and such other indirect compensation as may be required to be recognized for Break in Service purposes under ERISA or rules or regulations related thereto.

    Section 2.8 -  Code.  Code means the Internal Revenue Code of 1986, as amended or replaced from time to time.

    Section 2.9 -  Collective Bargaining Agreement.  Collective Bargaining Agreement means the existing Collective Bargaining Agreement between Buckbee-Mears Saint Paul and the Union effective June 1, 1976 through May 31, 1978, as well as any extensions or renewals thereof, or any new Collective Bargaining Agreement executed in the future which provides for the payment of contributions to the Retirement Fund as well as any extension or renewal thereof.

    Section 2.10 - Company.  Company means BMC Industries, Inc.

    Section 2.11 - Computation Periods.

(a)      Eligibility Computation Periods - the 12-month period beginning with an employee's Employment Commencement Date, and the 12-month period commencing on any Plan Anniversary Date after his Employment Commencement Date.

(b)      Vesting and Accrual Computation Periods - the 12-month period commencing on the Plan Anniversary Date.

    Section 2.12 - Effective Date.  Except as specifically stated herein, the Effective Date of this Restatement is January 1, 2001.

    Section 2.13 - Eligibility and Vesting Service.

(a)      Eligibility Service after December 31, 1975 is accumulated at the rate of one year for each Eligibility Computation Period in which an Eligible Employee completes 1,000 or more Hours Worked.  There is no accumulation for an Eligible Employee for a Computation Period in which he has less than 1,000 Hours Worked.

(b)      Vesting Service after December 31, 1975 is accumulated at the rate of one year for each Vesting Computation Period in which an Eligible Employee completes 1,000 or more Hours Worked.  There is no accumulation for an Eligible Employee for a Vesting Computation Period in which he has less than 1,000 Hours Worked.

Except, in the event an Eligible Employee's first Eligibility Computation Period in which 1,000 or more Hours Worked are completed overlaps two Vesting Computation Periods, neither of which contains 1,000 or more Hours Worked by the Eligible Employee, the second such Vesting Computation Period will be deemed, for vesting purposes, to contain 1,000 hours.  There is no accumulation for any Vesting Computation Periods prior to the Vesting Computation Period in which the Eligible Employee attains the age of 18.

Notwithstanding the definition of "Hours Worked" contained in this Plan, all Hours Worked by an employee for the Employer, the Company and any other corporation that is a member of a controlled group of corporations, (within the meaning of Code section 1563(a) without regard to Code sections 1563(a)(4) and 1563(e)(3)(C)) that includes the Company, any trade or business (whether or not incorporated) that together with the Company is under common control (within the meaning of Code section 414(c)), any member of an "affiliated service group" (within the meaning of Code section 414(m)) of which the Company is a member or any other organization that, together with the Company, is treated as a single employer pursuant to Code section 414(o) and Treasury Regulations thereunder ("ERISA Affiliates"); provided, that, for purposes of applying the limitations set forth at Section 414, such determination under Code section 1563(a) will be made by substituting the phrase "more than 50 percent" for the phrase "at least 80 percent" wherever it appears in such Code section, and will be counted for Eligibility Service and Vesting Service purposes whether or not such employee was an Eligible Employee at the time the hours were worked.

Eligible Employees on an authorized military leave of absence will accumulate hours for Vesting and Eligibility Service at the rate of 40 hours for each seven (7) consecutive days of leave.

(c)      Vesting and Eligibility Service prior to January 1, 1976 for a Participant as of January 1, 1976, who had been covered under the Former Plan, will be the Participant's last period of continuous employment with the Company prior to January 1, 1976 rounded to the nearest year.

    Section 2.14 - Eligible Employee.

(a)      Except as provided in Subsection (b), an "Eligible Employee" is an employee who has performed services for the Employer as an employee of the Employer (as classified by the Company or the Employer at the time the services are performed without regard to any subsequent reclassification) for a period of at least sixty-six (66) working days covered by the Collective Bargaining Agreement and on whose behalf contributions are made to the Retirement Fund pursuant to the terms of the Collective Bargaining Agreement between Buckbee-Mears Saint Paul and the Union.

(b)      An individual who is classified by the Company or the Employer as an independent contractor, leased employee or as any other status in which the individual is not classified by the Company or the Employer as an employee of the Employer at the time services are performed is not an Eligible Employee.  No judicial or administrative reclassification, or reclassification by the Company or the Employer, will be applied to grant retroactive eligibility to any individual under the Plan.

(c)      In addition, Eligible Employee includes full-time officers and employees of the Union, the Retirement Fund, and any other benefit fund established by the Collective Bargaining Agreement, provided that contributions to the Retirement Fund are made on behalf of said Eligible Employees by their respective Employers.

    Section 2.15 - Employer.  Employer shall mean Buckbee-Mears Saint Paul (a unit of  the Company) and any employer of an Eligible Employee on whose behalf contributions are made into the Retirement Fund.  The Union, the Retirement Fund, and other benefit funds described in Section 2.14 hereof shall be deemed Employers for the limited purpose of making payments to the Retirement Fund on behalf of Eligible Employees (as defined in Section 2.14).

    Section 2.16 - Employment Commencement Date.  The date an Eligible Employee first works one hour for the Employer.

    Section 2.17 - ERISA.  The Employee Retirement Income Security Act of 1974, as amended from time to time.

    Section 2.18 - Fiduciary.  The named Fiduciary of the Plan is the Board of Trustees, the Investment Manager, the Plan Administrator, insurance company or companies, or combination thereof, appointed and acting from time to time in accordance with the provisions of Section 5.2 and Article VII and the  Retirement Fund, to hold, invest and disburse assets in the Retirement Fund and administer the Plan.

    Section 2.19 -  Former Plan.  The Former Plan is the Restated Graphic Communications International Union, Twin Cities Local 6A - Buckbee Mears Pension Plan in existence the day before the Effective Date of this Plan.

    Section 2.20 - Hours Worked.  Determined as follows:

(a)      For Eligible Employees whose hours are not required to be counted and recorded by any Federal Law such as the Fair Labor Standards Act, Hours Worked will be recorded at the rate of 45 for each 7 days of employment in covered employment during the Computation Period in which the Eligible Employee would be required under Subsection (c) hereof to be credited with at least one (1) Hour Worked.

(b)      For all other Eligible Employees, Hours Worked will be total Hours Worked computed in accordance with Subsection (c) hereof.

(c)      (1)      "Hours Worked" shall mean each hour worked for which the Employer, either directly or indirectly, pays an Eligible Employee, or for which the Eligible Employee is entitled to payment, for the performance of duties during the Plan Year.  The Eligible Employee shall be credited with the Hours Worked under this subparagraph (1) for the Plan Year in which the Eligible Employee performs the duties, irrespective of when paid;

        (2)      Each Hour Worked for back pay, irrespective of mitigation of damages, to which the Employer has agreed or for which the Eligible Employee has received an award.  Hours Worked shall be credited under this subparagraph (2) to the Eligible Employee for the Plan Year(s) to which the award or the agreement pertains rather than for the Plan Year in which the award, agreement or payment is made; and

        (3)      Each Hour Worked for which the Employer, either directly or indirectly, pays an Eligible Employee, or for which the Eligible Employee is entitled to payment (irrespective of whether the employment relationship is terminated), for reasons other than for the performance of duties during a Plan Year, such as leave of absence, vacation, holiday, sick leave, illness, incapacity (including disability and periods for which an Eligible Employee is entitled to receive workers' compensation benefits), layoff, jury duty or military duty.  Hours Worked shall be credited under this subparagraph (3) for the Plan Year in which the Employer pays the Eligible Employee, the Eligible Employee becomes entitled to payment or the payment becomes due, whichever first occurs.  Notwithstanding the preceding provisions of this subparagraph (3), Hours Worked shall not be credited for:

(i)       more than five hundred one (501) Hours Worked under subparagraph (c) to an Eligible Employee on account of any single continuous period during which the Eligible Employee does not perform any duties (whether or not such period occurs during a single Plan Year);

(ii)      hours for which payments are made or due to the Eligible Employee under a plan maintained solely for the purpose of complying with the applicable unemployment compensation law; and

(iii)     hours for which a payment to an Eligible Employee solely reimburses the Eligible Employee for medical or medically related expenses incurred by the Eligible Employee.

An Hour Worked shall not be credited under more than one of the above subparagraphs (1), (2) or (3) of subsection (c).  Furthermore, if the Eligible Employee is to be credited with Hours Worked for the twelve (12) month period beginning with the Eligible Employee's Employment Commencement Date, then the twelve (12) month period shall be substituted for the term "Plan Year" wherever the latter term appears in this Section 2.20.

(d)      Hours Worked shall also include all Hours Worked by any Eligible Employee for which the Eligible Employee receives compensation from the Union.  These hours represent lost time hours which, but for this subsection (d), the Eligible Employee would not otherwise be given credit.

Any ambiguity with respect to the crediting of an Hour Worked shall be resolved in favor of the Eligible Employee.  Furthermore, in crediting Hours Worked under this Section 2.20, the rules of paragraphs (b) and (c) of Department of Labor Regulation § 2530.200b-2 which the Plan, by this reference, specifically incorporates in full within this Section 2.20, shall be applied.

Solely for purposes of determining whether the Eligible Employee incurs a Break in Service under any provision of this Plan, the Plan Administrator shall credit Hours Worked during an Eligible Employee's unpaid absence period due to maternity or paternity leave if his or her absence is due to the Eligible Employee's pregnancy, the birth of the Eligible Employee's child, the placement with the Eligible Employee of an adopted child, or the care of the Eligible Employee's child immediately following the child's birth or placement.  The Plan Administrator shall credit Hours Worked under this paragraph on the basis of the number of Hours Worked the Employee would receive if he were paid during the absence period or, if the Plan Administrator cannot determine the number of Hours Worked the Eligible Employee would receive, on the basis of eight (8) hours per day during the absence period.  The Plan Administrator only shall credit the number of Hours Worked (up to 501 Hours Worked) necessary to prevent an Eligible Employee's Break in Service.  The Plan Administrator shall credit all Hours Worked described in this paragraph to the computation period in which the absence period begins or, if the Eligible Employee does not need these Hours Worked to prevent a Break in Service in the computation period in which is absence period begins, the Plan  Administrator shall credit these Hours Worked to the immediately following Computation Period.  The Plan Administrator shall apply this paragraph for absence periods which begin in Plan Years commencing after December 31, 1984.

(e)      Hours Worked shall also include hours during which a Participant would have worked but for one or more involuntary furlough(s), up to a maximum of sixty (60) working days or four-hundred fifty (450) hours in any Plan Year.  An involuntary furlough shall be defined as a period of time during which the Participant would have worked but for the temporary shutdown of operations mandated by the Company.

(f)       Notwithstanding any provision of this Plan to the contrary, contributions, benefits and service credit with respect to qualified military service will be provided in accordance with Section 414(u) of the Code.

    Section 2.21 - Normal Retirement Date.  The Normal Retirement Date of a Participant is the last day of the month in which he attains age 65.

    Section 2.22 - Normal Retirement Age.  A Participant's Normal Retirement Age is age 65, or five years after the Participant commenced participation in the Plan, whichever is later.

    Section 2.23 - PBGC.  Pension Benefit Guaranty Corporation, a body corporate within the Department of Labor established under the provisions of Title IV of ERISA.

    Section 2.24 - Participant.  A Participant is an Eligible Employee or former Eligible Employee who has satisfied the eligibility requirements of Article III and who is either accruing a benefit or is entitled to receive a benefit under the Plan.

    Section 2.25 - Plan.  The Plan is the Graphic Communications International Union, Twin Cities Local 6A - Buckbee-Mears Pension Plan as may be amended from time to time, this document comprising the Seventh Restatement of such Plan.

    Section 2.26 - Plan Administrator.  The Plan Administrator shall be appointed by the Trustees and serve until replaced by the Trustees or until said Plan Administrator resigns.

    Section 2.27 - Plan Anniversary Date.  The Plan Anniversary Date of this Plan is January 1.

    Section 2.28 - Plan Year.  The Plan Year is the 12-month period commencing each January 1.

    Section 2.29 - Re-Employment Commencement Date.  The date following a Break in Service when an Eligible Employee first works one hour for the Employer.

    Section 2.30 - Retirement Fund.  Retirement Fund  means the Restated Agreement and Declaration of Trust of  Graphic Communications International Union, Twin Cities Local 6A - Buckbee-Mears Retirement Fund, consisting of all contributions to the Retirement Fund received by the Trustees, together with all income, increments, earnings, and profits therefrom, and all other assets held by the Trustees for the uses, purposes, and trusts set forth in said Retirement Fund Trust Agreement.

    Section 2.31 - Termination of Employment.  Termination of Employment is the severance of an Eligible Employee's employment relationship with the Employer, the Company and ERISA Affiliates (as defined in Section 2.13).

    Section 2.32 - Trustees.  Trustees or Trustee means the Trustees or a Trustee of the Retirement Fund.

    Section 2.33 - Union.  Union means Graphic Communications International Union, Twin Cities Local 6A.

    Section 2.34- Vesting.  For purposes of this Plan, an Eligible Employee's Accrued Benefit shall be vested pursuant to the following schedule:

Years of Vesting Service                                 % Vested

0-4 Years of Service                                        0%

5   Years or More                                         100%
 

For Plan years prior to January 1, 1989, the following schedule applies:
 

Years of Vesting Service                                 % Vested

0-9 Years of Service                                         0%

10 Years or More                                          100%

ARTICLE III

EMPLOYEE PARTICIPATION

    Section 3.1 - Eligibility for Participation.  Each Eligible Employee shall become a Participant in the Plan as follows:

(a)      Any Eligible Employee included under the provisions of the Former Plan as of the Effective Date shall continue to participate in accordance with the provisions of this amended and restated Plan.

(b)      Any other Eligible Employee as of the Effective Date who has both attained age 21 and completed an Eligibility Computation Period ending prior to said date, during which he had not less than 1,000 Hours Worked, shall become a Participant on the Effective Date.

(c)      The participation of any Eligible Employee thereafter to become a Participant shall commence as of the earlier of January 1 or July 1 following the date he has both attained age 21 and completed an Eligibility Computation Period ending prior to said date of not less than 1,000 Hours Worked.

    After a Break in Service, the provisions of Section 3.3 and 3.4 shall be applicable.

    Section 3.2 - Transfer to Eligible Employee Status.  Transfer from an ineligible status to the status of an Eligible Employee will result in immediate participation if the Eligible Employee satisfies the requirements of Section 3.1; otherwise he will begin participation in The Plan as provided for in Section 3.1.

    Section 3.3 - Re-Employment after a Break in Service.  An Eligible Employee who has been re-employed after a Break in Service may resume participation in the Plan as soon as he has completed a 12-month period in which he has 900 Hours Worked.  He shall reenter the Plan retroactive to his Re-Employment Commencement Date.

    Such a Participant shall receive Accrual Service if he has 900 or more Hours Worked during the first Accrual Computation Period ending after his Re-Employment Commencement Date.  If he has less than 900 Hours Worked during this partial Computation Period but he has hours equal to at least 900 considering the fraction of the Computation Period worked, he will accumulate a fraction of a year of Accrual Service equal to the ratio of the Hours Worked during such partial Computation Period to 1,800 hours for a full accrual Computation Period.  For periods of re-employment prior to January 1, 1981, an Eligible Employee shall earn credit as described in the previous sentence with 975 hours substituted for 900 hours and 1,950 hours substituted for 1,800 hours.

    Section 3.4 - Preservation of Pre-Break Service.  In the event of re-employment after a Break in Service, service completed prior to the Break in Service for non-vested Participants will be disregarded for all purposes under the Plan unless the number of the Eligible Employee's consecutive Breaks in Service is less than:

(a)      The Eligible Employee's aggregate Years of Vesting Service (without regard to Vesting Service disregarded under Section 3.4), or

(b)      five (5) years, if greater than (a).

    In the event that a Participant terminates employment with the Employer for any reason and suffers consecutive Breaks in Service of five years or less and returns to employment with the Employer as an Eligible Employee, that Participant's Accrued Benefit under Section 2.3 of this Plan shall be calculated by multiplying all of that Participant's years of Accrual Service with the Employer times the Accrued Benefit rate in effect as of the date of that Participant's final termination of employment with the Employer.  In the event that a Participant terminates employment with the Employer for any reason, suffers consecutive Breaks in Service in excess of five years and subsequently returns to employment with the Employer as an Eligible Employee, the Participant's Accrued Benefit under Section 2.3 of the Plan shall be calculated by multiplying the applicable Accrued Benefit rate in effect at the time of the Participant's first Termination of Employment times the years of Accrual Service earned at that time and adding to that figure the amount determined by multiplying the years of Accrual Service earned after the Breaks in Service times the applicable Accrued Benefit rate in effect at the Participant's final Termination of Employment with the Employer.

ARTICLE IV

BENEFITS

    Section 4.1 - Normal Retirement Benefit Formula.  A Participant's pension benefit payable in the normal form shall be a benefit payable for his lifetime in a monthly amount equal to his Accrued Benefit.  The Termination of Employment of a Participant on or after his Normal Retirement Age shall be deemed to be a normal retirement.  Upon such retirement, he shall be entitled to a pension in the amount determined according to the first sentence of this Section 4.1 payable monthly for life, with the first payment to be made as of the first day of the month next following his Termination of Employment, if he is then living, and the last  payment as of the first day of the month in which his death occurs.

    Section 4.2 - Accrued Benefit.  The Accrued Benefit may be determined as of any point in time that the Participant is an Eligible Employee.  In no event will any Accrued Benefit determined after the Effective Date be less than the Accrued Benefit determined as of the preceding Plan Anniversary Date.

    Section 4.3 - Early Retirement Benefit.  The Termination of Employment of a Participant prior to his Normal Retirement Date shall be deemed to be an early retirement if he has then attained age 55 and completed at least 10 years of Vesting Service.  Upon such early retirement, he shall be entitled to a pension payable monthly for life, with the first payment to be made as of the first day of the month next following his Normal Retirement Date, if he  is then living, and the last payment as of the first day of the month in which his death occurs.  The amount of each monthly payment shall equal his Accrued Benefit.

    In lieu of such payment the Participant may elect to have benefits commence on the first of any month following his Termination of Employment and prior to his Normal Retirement Date.  The benefit payable from such earlier commencement date shall be the pension benefit payable in the normal form (as determined under Section 4.1)..

(a)      reduced by six and two-thirds (6-2/3%) percent reduction per year for the first five years of commencement immediately prior to age 65; and

(b)      reduced by three and one-third (3-1/3%) percent reduction per year for an additional five years.

    Section 4.3. A. - Special Early Retirement Benefit.  Effective January 1, 1997, any Participant who terminates employment with the Employer after he reaches age 55 on or after January 1, 1997 and has completed at least 25 years of Accrual Service as of the date of termination shall be eligible to commence a retirement benefit after he has attained age 62 without any reduction in the Accrued Benefit calculated under Section 2.3.

    Section 4.4 - Benefit Upon Other Termination of Employment.  If a Participant's Termination of Employment occurs prior to his Normal Retirement Age, and if at the time of his Termination of Employment he has completed at least 5 years of Vesting Service and has not attained age 55, he shall be entitled to a pension payable monthly for life, with the first payment to be made as of the first day of the month next following his Normal Retirement Date, if he is then living, and the last payment as of the first day of the month in which his death occurs.  The amount of each monthly payment shall equal his Accrued Benefit.

    Section 4.4.A. - Disability Benefit.  Effective January 1, 1998, any Participant with at least 10 years of Accrual Service who terminated employment after age 55 due to a total and permanent disability as determined by the Social Security Administration shall be eligible to retire as of the date of disability without any reduction in the Accrued Benefit calculated under Section 2.3.  Upon such disability retirement, he shall be entitled to a pension payable monthly for life, with the first payment to be made as of the first day of the month following his Termination of Employment and submission of his application for the pension benefit accompanied by evidence that he has been determined to be totally and permanently disabled by the Social Security Administration.  If the Participant is no longer totally and permanently disabled at any time prior to age 62, the disability pension shall be discontinued and the Participant shall be entitled to additional pension benefits only in accordance with the other provisions in the Plan.

    Section 4.5 - Early Commencement of Benefits.  A Participant who qualifies under Section 4.4 and has at least ten years of Vesting Service may elect a reduced monthly benefit which is in lieu of the aforesaid benefit, with the first payment to be made as of the first day of any month after his attainment of age 55 and prior to his Normal Retirement Date and the  last payment as of the first day of the month in which his death occurs.  The benefit payable from such earlier commencement date shall be the pension benefit payable in the normal form (as determined under Section 4.1):

(a)      reduced by six and two-thirds (6/2/3%) percent reduction per year for the five years immediately prior to age 65; and

(b)      reduced by three and one-third (3-1/3%) percent reduction per year for an additional five years.

    Section 4.6 - Minimum Benefit.  In no event will the benefit determined in Section 4.1, 4.2, 4.3 or 4.4 and payable from Normal Retirement Date be less than the Accrued Benefit under the Former Plan as of the Effective Date.

    Section 4.7 - Benefits that Matured Prior to the Effective Date.  Benefits, if any, payable on account of a Participant's Termination of Employment prior to the Effective Date shall be  determined and paid in accordance with the provisions of the Plan in effect as of the date of his Termination of Employment.

    Section 4.8 - Non-Duplication of Benefits.  In the event that a Participant terminates covered employment under the Collective Bargaining Agreement but continues in the employment of the Employer or the Company in a different position, the Participant shall not accrue any additional Accrual Service under this Plan unless the Participant later resumes covered employment under the Collective Bargaining Agreement.  In addition, the Accrued Benefit defined under Section 2.3 of the Plan shall be calculated for that Participant who terminated employment with the Employer as of the date the Participant ceased to be an Eligible Employee covered by the Collective Bargaining Agreement and not the date the Participant later terminates non-covered employment with the Employer or the Company.  In the event that the Participant is re-employed and is an Eligible Employee covered by the Collective Bargaining Agreement, and received Accrual Service after a one-year Break in Service, the Accrued Benefit calculated under Section 2.3 of the Plan shall be calculated based on the applicable Accrued Benefit at the time of the earlier termination times the years of Accrual Service at that time plus later years of Accrual Service times the applicable Accrued Benefit rate in effect under the Plan at the subsequent Termination of Employment.  In addition, notwithstanding any other provisions of the Plan, benefits otherwise payable to a Participant under Section 4.1, 4.3 or 4.4 shall be suspended during such period as he receives long or short term disability benefits provided by the Employer or the Company and during periods of re-employment with the Employer prior to the Participant's Normal Retirement Date.  Any benefits payable subsequent to Termination of Employment will be actuarially adjusted to reflect the payments already received.

    Section 4.9 - Optional Forms of Benefit Payments.  In lieu of the amount and form of pension payable under Section 4.1, 4.3 or 4.4, a Participant may, under such rules and regulations as the Trustees may prescribe which are in accord with the advice of the Actuary, and subject to the provisions of Section 4.10 and 4.16, elect to have a pension benefit payable in any of the following optional forms:

(a)      Ten (10) Year Certain and Life Benefit.  A reduced monthly benefit payable to the Participant for his or her life, with the provision that, if the Participant dies before having received 120 monthly payments, such reduced monthly payments will continue to the Participant's designated Beneficiary until the number of monthly payments made to the Participant and the Participant's designated Beneficiary total 120;

(b)      Joint and Fifty (50%) Percent Survivor Benefit.  A reduced monthly benefit payable to the Participant for his or her life, with the provision that, if the Participant is survived by his or her contingent annuitant, one-half of such reduced monthly benefit will be continued to the contingent annuitant for the duration of the contingent annuitant's life; and

(c)      Joint and One Hundred (100%) Percent Survivor Benefit.  A reduced monthly benefit payable to the Participant for his or her life, with the provision that, if the Participant is survived by his or her contingent annuitant, such reduced monthly benefit will be continued to the contingent annuitant for the duration of the contingent annuitant's life.

The amount of the benefit available under any of the options set forth in this Section shall be calculated by applying the reduction factors set forth in Appendix A to this Pension Plan.  Benefit payments under any option elected in accordance with the terms of this paragraph shall commence on the same date that benefit payments would otherwise commence under Section 4.1, 4.3, 4.4 or 4.5, whichever is applicable.  In conjunction with the Participant's election of an optional benefit under subsections (b) or (c), the Participant must designate, in form prescribed by the Trustees, a contingent annuitant to receive the survivor benefits thereunder; provided, that, if the designation is not made at that time, a designation may be made at a later date, but not after the commencement of benefit payments to the Participant.  Notwithstanding other provisions of this paragraph to the contrary, if a Participant dies before his or her payments have commenced, the Trustees shall not make payment to a Beneficiary who is not the Participant's spouse for a period which exceeds five (5) years from the date of the Participant's death.

    If a Participant remains in the employ of the Company after his Normal Retirement Date, and if his death occurs thereafter prior to his Termination of Employment, and if he elected an optional form of benefit payment under this Section which was not revoked prior to his death, the same benefit shall be provided his Beneficiary or joint or contingent annuitant under the option as though the Participant's Termination of Employment had occurred on his Normal Retirement Date and he had received monthly payments under the option for each month prior to his death.

    Section 4.10 - Qualified Joint and Survivor Annuity.  Unless a Participant elects otherwise, as hereinafter specified in Section 4.16, benefits shall be paid in the form of a Qualified Joint and Survivor Annuity with respect to any Participant who has a spouse and who -

(a)      begins to receive benefit payments under Section 4.1, 4.3, 4.4 or 4.5, or

(b)      dies on or after attaining Normal Retirement Age and prior to his or her Termination of Employment, or

(c)      ceases to be an Eligible Employee on or after the date he is entitled to receive benefits under Sections 4.1 or 4.4 and thereafter dies before beginning to receive such benefits.

A "Qualified Joint and Survivor Annuity" is an annuity for the life of the Participant with a survivor annuity for the life of his spouse which is 50% of the amount payable for the life of the Participant.  The amount of the benefit available under this Section shall be calculated by applying the reduction factors set forth in Appendix A to this Plan, under the Option "Joint and 50% Survivor."

    Section 4.11 - Pre-Retirement Spouse Annuity.

(a)      Eligibility. If a married Participant dies prior to commencement of payment of his Nonforfeitable Accrued Benefit, the Trustee will distribute to the Participant's surviving spouse a pre-retirement survivor annuity, unless the Participant and his spouse were not married throughout the one (1) year period ending on the date of his death.  This Section shall apply to a Participant who dies after August 22, 1984, and either (i) completes at least one (1) Hour Worked with the Employer after August 22, 1984, or (ii) separated from Service with at least ten (10) years of service and completed at least one (1) Hour Worked with the Employer in a Plan Year beginning after December 31, 1975.  If a Participant's death benefit is payable on or after the Effective Date and this Section does not apply to the Participant, the Plan Administrator shall make payment of the Participant's entire Nonforfeitable Accrued Benefit in accordance with Sections 4.10 and 4.15, subject to the requirements of subsection (c) hereof.

For a Participant dying after the earliest retirement age under the Plan, the pre-retirement spouse annuity shall equal the survivor annuity portion of the qualified joint and fifty (50%) percent survivor annuity the Trustees would have paid under Section 4.10 if the Participant had commenced receiving the qualified joint and survivor annuity the day before his death.  For a Participant dying on or before the earliest retirement age under the Plan, the pre-retirement survivor annuity shall equal the survivor annuity portion of the qualified joint and fifty (50%) percent survivor annuity the Trustees would have paid under Section 4.10 if the Participant had separated from service on the date of his death, had commenced receiving the qualified joint and survivor annuity at the earliest retirement age under the Plan, and had died the day after attaining the earliest retirement age under the Plan.  The "earliest retirement age under the Plan" is the earliest date on which the Plan permits the Participant to elect to receive retirement benefits.  Notwithstanding the immediately preceding provisions of this paragraph, if the actuarial equivalent of the pre-retirement spouse annuity calculated under the formula set forth in Section 2.4 is not greater than $5,000, (using the GATT interest rates in effect as of retirement) the Trustees will pay the Participant's surviving spouse the actuarial equivalent in a single lump sum payment as a complete settlement of all obligations under this Plan.

The Trustees shall commence payment of the pre-retirement spouse annuity on or before the later of one (1) year after the Participant's death or the date the Participant would have attained age seventy and one-half (70-1/2) unless the Participant's surviving spouse files an election to commence payment at some earlier date.

(b)      No Reduction of Pension Benefits.  A Participant's pension benefits shall not be reduced as a result of the pre-retirement spouse annuity coverage required under Section 4.11(a) or the survivor's annuity coverage under Section 4.11(c).  The Plan shall bear the cost of providing the pre-retirement spouse annuity or the survivor's annuity benefits.

(c)      Payment of Certain Survivor Benefits After the 1/1/2001.  If a married Participant who is not subject to Section 4.11(a) but who has received credit for at least one (1) Hour Worked after September 1, 1974, has a death benefit payable on or after the Effective Date, the Participant's surviving spouse shall receive a spouse's pre-retirement annuity if:

(1)      the Participant had made a spouse's annuity election at any time during the spouse annuity election period; and

(2)      dies while employed as an Eligible Employee of the Employer on or after attaining qualified early retirement age.  The spouse annuity election period shall begin on the ninetieth (90^th) day before the Participant attains the qualified early retirement age and shall end on the date of the Participant's Termination of Employment.  A Participant's "qualified early retirement age" is the later of the first day of the one hundred twentieth (120^th) month beginning before the Participant attains Normal Retirement Age, or the date on which the Participant began participation under this Plan.

Furthermore, if a married Participant who is not subject to Section 4.11(a) but who has received credit for at least one (1) Hour Worked after September 1, 1974, has a death or termination benefit payable on or after the Effective Date, the Participant's surviving spouse shall receive a spouse's annuity if:

(3)      the Participant dies on or after Normal Retirement Age while employed  by the Employer, or has a Termination of Employment on or after attaining his qualified early retirement age but dies before the Trustee commences payment of his pension; and

(4)      the Participant (and, for elections made after December 31, 1984, the Participant's spouse) has not waived the qualified joint and survivor annuity during the ERISA election period.  The ERISA election period begins on the later of (i) the date one hundred and eighty (180) days prior to the Participant's attaining qualified early retirement age, or (ii) the date the Participant commenced participation in the Plan, and ends on the Participant's annuity starting date under Section 4.10.

The spouse's pre-retirement annuity shall equal the survivor annuity portion of the qualified joint and survivor annuity payable under Section 4.10 determined as if the Participant had retired the day before his death and commenced receiving the qualified joint and survivor annuity.

    Section 4.12 - Payment of Small Amounts.

(a)      If the actuarially equivalent present value of a Participant's vested Accrued Benefit does not exceed Five Thousand Dollars ($5,000) and did not exceed such amount at the time of any previous distribution of such benefit, the benefit shall be paid to the Participant or to his or her surviving spouse following the Participant's death in a single lump sum payment no later than sixty (60) days after the close of the Plan Year following the Plan Year in which the Participant terminates employment or dies, whichever occurs first.  Actuarially equivalent lump sum values shall be calculated on the basis of (1) the mortality table based on the prevailing commissioners' standard table (described in section 807(d)(5)(A) of the Code, which is the mortality table prescribed in Revenue Ruling 95-6 for distributions with an annuity starting date before December 31, 2002 and the mortality table prescribed in Revenue Ruling 2001-62 for distributions with an annuity starting date on or after December 31, 2002)) used to determine reserves for group annuity contracts issued on the date as of which the lump sum is being determined (without regard to any other subparagraph of section 807(d)(5)), as prescribed by the Commissioner of Internal Revenue in revenue rulings, notices or other guidance and (2) for any lump sum payment made during a calendar year, an interest rate equal to the annual interest rate on 30-year Treasury securities for the November immediately preceding such calendar year as such rate is prescribed by the Commissioner of Internal Revenue in revenue rulings, notices or other guidance.

(b)      In the case of any distribution pursuant to this section that constitutes an "eligible rollover distribution," within the meaning of section 402(c)(4) of the Internal Revenue Code, the Trustees will, if so instructed by the distributee in accordance with uniform rules, make the distribution to an "eligible retirement plan" within the meaning of section 402(c)(8) of the Internal Revenue Code.  The foregoing provision will not apply if (i) the aggregate taxable distribution to be made to the distributee from this Plan during the distributee's taxable year is less than Two Hundred Dollars ($200) or (Ii) if less than the entire taxable amount of the distribution is to be distributed to an eligible retirement plan and the amount to be distributed to the eligible retirement plan is less than five Hundred Dollars ($500).

    Section 4.13 - No Other Benefits.  In the event the Trustees distribute any part or all of  a Participant's Accrued Benefit to him and the Participant later resumes active employment with the Employer, the Trustee shall compute the Participant's Accrued Benefit by taking into account all of the Participant's Years of Participation.  However, the Trustee shall offset the Participant's Accrued Benefit so computed by the Participant's Accrued Benefit attributable to any distribution the Trustee has made to the Participant.

    Section 4.14 - Maximum Benefits.  The maximum benefit, when expressed as a monthly pension, shall not exceed $7,500.00, subject to the following:

(a)      The maximum shall apply to the single-life pension computed under Article IV.

(b)      If benefits begin prior to age 65, the maximum will apply to such reduced pension; provided that, if benefits begin prior to age 55, the maximum will apply to a pension beginning at age 55, which is the Actuarial Equivalent of such benefit.

(c)      If the Participant has fewer than ten years of credited service at retirement, the applicable maximum shall be multiplied by a fraction, of which the numerator is his Accrual Service and the denominator is 10.

(d)      The maximum amount of $7,500.00 per month shall be increased as permitted in Section 415(b) of the Internal Revenue Code.

    Notwithstanding the foregoing with respect to a Participant included under the prior provisions of the Plan, the maximum computed under this subsection shall not be less than the Pension payable under the Plan provisions in effect as of December 31, 1982 based upon his rate of compensation under the Plan in effect as of such date and on Accrual Service to the date of his Termination of Employment.

    Section 4.15 - Death Benefit.  Upon the death of a Participant who has ten (10) or more years of Vesting Service and who is an Eligible Employee whose employment with the Employer has not terminated or is a former Eligible Employee currently on leave of absence or laid off and maintaining his name on the Employer's seniority or recall list, the sum of Five Thousand and no/100s ($5,000.00) Dollars shall be paid in a single lump sum payment to the Participant's Beneficiary designated in accordance with Section 2.6 of this Plan.  However, if such Participant is married at the time of his death and has been married for the one year period immediately preceding his death, any benefits payable as a result of Participant's death shall be paid to his spouse unless his spouse has consented to the designation of another Beneficiary.  Such consent shall be notarized and submitted to the Plan Administrator.

    Section 4.16 - Manner of Election - Revocation for Joint and Survivor Annuity - Normal Retirement Age.  A Participant may make an election not to have his Accrued Benefit paid in the form of a Qualified Joint and Survivor Annuity under Section 4.10 at any time during the election period.  The election period shall begin on the date the Plan Administrator furnishes to the Participant the information required under the third paragraph of this Section 4.16 and shall end on the ninetieth (90^th) day before the Trustee commences to pay the Participant his Accrued Benefit.  If, within 60 days from the date the information was furnished as required by the preceding sentence, a Participant makes a request for additional information, the election period shall extend, to the extent necessary, to include the ninety (90) calendar days immediately following the date the Plan Administrator either mails or personally delivers the requested additional information to the Participant.  A Participant may revoke an election made under this Section 4.16 at any time during the election period, and thereafter may make a new election at any time within the election period.  For waiver elections made after December 31, 1984, a Participant's spouse (to whom the survivor annuity is payable under the Qualified Joint and Survivor Annuity) must consent in writing to the waiver election, acknowledging the effect of the election and such consent must be witnessed by a Notary Public.

    The Plan Administrator may accept as valid a waiver election which does not satisfy the spousal consent requirement described above if the Plan Administrator establishes the Participant does not have a spouse, the Plan Administrator is not able to locate the Participant's spouse, or other circumstances exist under which the Secretary of Treasury will excuse the consent requirement.

    The Plan Administrator shall furnish to each Participant and spouse eligible to receive a normal retirement pension a written general description of the Qualified Joint and Survivor Annuity, the Participant's right to make, and the effect of an election to waive the Joint and Survivor Annuity form of benefit, the rights of the Participant's spouse regarding the waiver election.  The written description shall include the financial effect upon the Participant's normal retirement pension (in terms of dollars per pension payment) of making an election not to receive payment in the form of a Qualified Joint and Survivor Annuity.  The Plan Administrator either shall mail or personally deliver the written description at such time to ensure its receipt by the Participant on or about the earlier of:

(a)      The date nine (9) months prior to the Participant's attaining Normal Retirement Age; or

(b)      The later of the date one hundred eighty (180) days prior to the Participant's satisfying the requirements for an early commencement of benefits under Section 4.5 or the date the Participant commences participation in the Plan.

    The Plan Administrator shall provide and prescribe the form for a Participant's written election and the spouse's consent under this Section 4.16.  The election form shall state clearly that the Participant is electing to receive all of his Accrued Benefit under the Plan in a form other than a Qualified Joint and Survivor Annuity.  An election, or revocation of an election, is effective as of the date filed with the Plan Administrator.

ARTICLE V

PLAN FINANCING

    Section 5.1 - Contributions. No contributions shall be required or permitted under the Plan from any Participant.  The Company and any participating Employer shall make contributions in such amounts and at such times as determined by the Company in accordance with a funding method and policy to be established by said Company which will be consistent with the minimum funding standards of ERISA.  Forfeitures arising under this Plan, shall be applied to reduce the cost of the Plan, not to increase the benefits otherwise payable to Participants.

    Section 5.2 - Retirement Fund.  All contributions made by the Company or a participating Employer under this Plan shall be paid to the Investment Manager, or if there is no Investment Manager, then to the corporate agent, or if there is no corporate agent, then to the Trustees and deposited in the Retirement Fund.  All assets of the Retirement Fund, including investment income, shall be retained for the exclusive benefit of Participants and their beneficiaries, shall be used to pay benefits to such persons or to pay administrative expenses to the extent not paid by the Company, and shall not revert or inure to the benefit of the Company.

    Notwithstanding anything herein to the contrary, upon the request of the Company or a participating Employer, a contribution which was conditioned upon qualification of the Plan or any amendment thereof under Section 401(a) of the Internal Revenue Code shall be returned to the Company or participating Employer within one year after the denial of the qualification.

ARTICLE VI

ACTUARY

    Section 6.1 - Appointment and Duties.  The Company shall appoint an individual or a corporation or a firm with at least one individual who is qualified or experienced in
performing actuarial services in the valuation, funding and administration of retirement, pension, or annuity plans and who is an enrolled Actuary as provided under ERISA to serve as the Actuary to perform the services set forth herein and to perform such additional services  with respect thereto as may be conferred by the Company and as are consistent with the provisions of the Plan.  All determinations of Actuarial Equivalent values permitted or required to be made under the Plan or otherwise shall be made only in accordance with the advice of the Actuary, and the rules, regulations, and tables relating thereto shall become effective only with the approval of the Actuary.

    Section 6.2 - Successors.  The Company shall have the right at any time to remove the Actuary then acting, to appoint a successor or successors, and to fill vacancies in the office of the Actuary.

ARTICLE VII

ADMINISTRATION

    Section 7.1 - Allocation of Responsibility Among Fiduciaries for Plan and Retirement Fund Administration.  The Fiduciaries shall have only those specified powers, duties, responsibilities and obligations as are specifically given to them under this Plan or the Retirement Fund.  In general, the Company and any participating Employers shall have the sole responsibility for making the contributions necessary to provide benefits under the Plan as specified in Article VII.

    The Trustees shall have the sole responsibility for the administration of the Plan and Retirement Fund and the management of the assets held under the Retirement Fund, all as specifically provided in the Retirement Fund.  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 Retirement Fund, 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 Retirement Fund, and is not required under this Plan or the Retirement Fund to inquire into the propriety of any such direction, information or action.  It is intended under this Plan and the Retirement Fund  that each Fiduciary shall be responsible for the proper exercise of its own powers, duties, responsibilities and obligations under this Plan and the Retirement Fund and shall not be responsible for any act or failure to act of another Fiduciary.  No Fiduciary guarantees the Retirement Fund in any manner against investment loss or depreciation in asset value.

    Section 7.2 - Facility of Payment.  Whenever, in the Trustees' opinion, a person entitled to receive any payment of a benefit or installment thereof hereunder is under a legal disability or is incapacitated in any way so as to be unable to manage his financial affairs, the Trustees may direct payments to such person or to his legal representative or to a relative or friend of such person for his benefit, or the Trustees may apply the payment for the benefit of such person in such manner as the Trustees consider advisable.  Any payment of a benefit or installment thereof in accordance with the provisions of this Section shall be a complete discharge of any liability for the making of such payment under the provisions of the Plan.

    Section 7.3 - Discretionary Authority.  The Plan Administrator appointed by the Trustees pursuant to this document shall have the discretion and authority to make all decisions necessary and useful to interpret and administer this Plan.  Decisions of the Plan Administrator shall be final and binding.  The Plan Administrator shall have the power to delegate any and all responsibility for administering the Plan.  However, such delegation shall not relieve the Plan Administrators of its responsibilities under this Plan.

ARTICLE VIII

MISCELLANEOUS

    Section 8.1 - Non-Guarantee of Employment.  Nothing contained in this Plan shall be construed as a contract of employment between the Company or the Employer and any Eligible Employee, or as a right of any Eligible Employee to be continued in the employment of the Company or the Employer, or as a limitation of the right of the Company of the Employer to discharge any of its employees, with or without cause.

    Section 8.2 - Rights to Retirement Fund Assets.  No Eligible Employee shall have any right to, or interest in, any assets of the Retirement Fund upon Termination of Employment or otherwise, except as provided from time to time under this Plan, and then only to the extent of the benefits payable under the Plan to such employee out of the assets of the Retirement Fund.  In case of termination or partial termination of this Plan, the rights of all affected Participants to their Accrued Benefit to the extent funded as of the date of such termination or partial termination, shall be nonforfeitable.  Except as otherwise may be provided under Title IV of ERISA, all payments of benefits as provided for in this Plan shall be made solely out of the assets of the Retirement Fund and none of the Fiduciaries shall be liable therefor in any manner.

    Section 8.3 - Non-Alienation of Benefits.  Subject to Section 8.4, benefits payable under this Plan shall not be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, charge, garnishment, execution or levy of any kind, either voluntary or involuntary, including any such liability which is for alimony or other payments for the support of a spouse or former spouse or for any other relative of the Participant, prior to actually being received by the person entitled to the benefit under the terms of the Plan; and any attempt to anticipate, alienate, sell, transfer, assign, pledge, encumber, charge or otherwise dispose of any right to benefits payable hereunder, shall be void.  The Retirement Fund shall not in any manner be liable for, or subject to, the debts, contracts, liabilities, engagements or torts of any person entitled to benefits hereunder.

    Section 8.4 - Distributions Under Domestic Relations Orders.  Nothing contained in this Plan shall prevent the Trustees and the Plan Administrator from complying with the provisions of a qualified domestic relations order (as defined in Code §414(p)).

    The Plan Administrator shall establish reasonable procedures to determine the qualified status of a domestic relations order.  Upon receiving a domestic relations order, the Plan Administrator promptly shall notify the Participant and any alternate payee named in the order, in writing, of the receipt of the order and the Plan's procedures for determining the qualified status of the order.  Within a reasonable period of time after receiving the domestic relations order, the Plan Administrator shall determine the qualified status of the order and shall notify the Participant and each alternate payee, in writing, of its determination.  The Plan Administrator shall provide notice under this paragraph by mailing to the individual's address specified in the domestic relations order, or in a manner consistent with Department of Labor regulations.  The Plan Administrator may treat as qualified any domestic relations order entered prior to January 1, 1985, irrespective of whether it satisfies all the requirements described in Code §414(p).

    If any portion of the Participant's nonforfeitable Accrued Benefit is payable during the period the Plan Administrator is making its determination of the qualified status of the domestic relations order, the Trustees shall segregate the amounts payable in a separate account and invest the segregated account solely in fixed income investments.  If the Plan Administrator determines the order is a qualified domestic relations order within eighteen (18) months of receiving the order, the Trustees shall distribute the segregated account in accordance with the order.  If the Plan Administrator does not make its determination of the qualified status of the order within eighteen (18) months after receiving the order, the Trustees shall distribute the segregated account in the manner the Plan would distribute if the order did not exist and shall apply the order prospectively if the Plan Administrator later determines the order is a qualified domestic relations order.

    The Trustees shall make any payments or distributions required under this Section 8.4 by separate benefit checks or other separate distribution to the alternate payee(s).

ARTICLE IX

AMENDMENTS

    Section 9.1 - Amendment.  The Trustees may amend or modify this Plan at any time provided no amendment shall be adopted which alters the basic purpose of this Plan or the Retirement Fund; conflicts with the terms of any Collective Bargaining Agreement or with any applicable law; causes the use or diversion of any part of the Retirement Fund for purposes other than those authorized herein; increases the burdens or obligations of the Company or causes a reversion of any of the assets of the Retirement Fund to the Company or to the Union.  Furthermore, the Trustees and Plan Administrator shall neither enact nor apply any amendment to the Plan to reduce a Participant's Accrued Benefit immediately before the effective date of the amendment, except to the extent permitted under Code §412(c)(8).  An amendment adopted after July 30, 1984, decreases a Participant's Accrued Benefit determined immediately prior to the adoption date if the amendment has the effect of either (1) eliminating or reducing an early retirement benefit or a retirement-type subsidy (as defined in Treasury regulations), or (2) except as provided by Treasury regulations, eliminating an optional form of benefit.  The Plan Administrator shall disregard an amendment described in the immediately preceding sentence to the extent application of the amendment would decrease the Participant's Accrued Benefit determined immediately prior to the adoption date of the amendment.

ARTICLE X

SUCCESSOR COMPANY AND MERGER OR CONSOLIDATION OF PLANS

    Section 10.1 - Successor Company.  In the event of the dissolution, merger, consolidation or reorganization of the Company, provision may be made by which the Plan and Retirement Fund will be continued by the successor; and, in that event, such successor shall be substituted for the Company under the Plan.  The substitution of the successor shall constitute an assumption of Plan Liabilities by the successor and the successor shall have all the powers, duties, and responsibilities of the Company under the Plan.

    Section 10.2 - Plan Assets.  In the event of any merger or consolidation of the Plan with, or transfer in whole or in part of the assets and liabilities of the Retirement Fund to another Trust Fund held under, any other plan of deferred compensation maintained or to be established for the benefit of all or some of the Participants of this Plan, the assets of the Retirement Fund applicable to such Participants shall be transferred to the other Retirement Fund only if:

(a)      each Participant would (if either this Plan or the other plan then terminated) 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 before the merger, consolidation or transfer (if this Plan had then terminated);

(b)      resolutions of the Board of Directors of the Company under this Plan, and of any new or successor company of the affected Participants, shall authorize such transfer of assets; and, in the case of the new or successor company of the affected Participants, its resolutions shall include an assumption of liabilities with respect to such Participants' inclusion in the new company's plan; and

(c)      such other plan and trust are qualified under Sections 401(a) and 501(a) of the Internal Revenue Code.

ARTICLE XI

TOP HEAVY PROVISIONS

    Section 11.1 - Top Heavy Plan Requirements.  With respect to any portion of this Plan which covers Participants who are not covered by the Collective Bargaining Agreement ("Non-Bargaining Unit Participants"), for any Top Heavy Plan Year, the Plan shall provide the special vesting requirements of Code Section 416(b) pursuant to Section 11.3 of the Plan and the special minimum benefit requirements of Code Section 416(c) pursuant to Section 11.4 of the Plan.

    Section 11.2 - Determination of Top Heavy Status.

(a)      The portion of this Plan benefitting the Non-Bargaining Unit Participants shall be a Top Heavy Plan for any Plan Year commencing after December 31, 1982 in which, as of the Determination Date, (1) the Present Value of Accrued Benefits of Key Employees and (2) the sum of the Aggregate Accounts of Key Employees under this Plan and all plans of an Aggregation Group, exceeds sixty percent (60%) of the Present Value of Accrued Benefits and the Aggregate Accounts of all Key and Non-Key Employees under this Plan and all plans of an Aggregation Group.

    If any Participant is a Non-Key Employee for any Plan Year, but such Participant was a Key Employee for any prior Plan Year, such Participant's Present Value of Accrued Benefit and/or Aggregate Account balance shall not be taken into account for purposes of determining whether this Plan is a Top Heavy or Super Top Heavy Plan (or whether any Aggregation Group which includes this Plan is a Top  Heavy Group).  In addition, for Plan Years beginning after December 31, 1984, if a Participant or Former Participant has not performed any services for any Employer maintaining the Plan at any time during the five year period ending on the Determination Date, any accrued benefit for such Participant or Former Participant shall not be taken into account for the purposes of determining whether this Plan is a Top Heavy or Super Top Heavy Plan.

(b)      This Plan shall be a Super Top Heavy Plan for any Plan Year commencing after December 31, 1983 in which, as of the Determination Date, (1) the Present Value of Accrued Benefits of Key Employees and (2) the sum of the Aggregate Accounts of Key Employees under this Plan and all plans of an Aggregation Group, exceeds ninety percent (90%) of the Present value of Accrued Benefits and the Aggregate Accounts of all Key and Non-Key Employees under this Plan and all plans of an Aggregation Group.

(c)      Aggregate Account: A Participant's Aggregate Account as of the Determination Date shall be determined under applicable provisions of the defined contribution plan used in determining Top Heavy Plan status.

(d)      "Aggregation Group" means either a Required Aggregation Group or a Permissive Aggregation Group as hereinafter determined.

(1)      Required Aggregation Group: In determining a Required Aggregation Group hereunder, each plan of the Employer in which a Key Employee is a participant in the Plan Year containing the Determination Date or any of the four preceding Plan years, and each other plan of the Employer which enables any plan in which a Key Employee participates to meet the requirements of Code Sections 401(a)(4) or 410, will be required to be aggregated.  Such group shall be known as a Required Aggregation Group.

In the case of a Required Aggregation Group, each plan in the group will be considered a Top Heavy Plan if the Required Aggregation Group is a Top Heavy Group.  No plan in the Required Aggregation Group will be considered a Top Heavy Plan if the Required Aggregation Group is not a Top Heavy Group.

(2)      Permissive Aggregation Group: The Employer may also include any other plan not required to be included in the Required Aggregation Group, provided the resulting group, taken as a whole, would continue to satisfy the provisions of Code Sections 401(a)(4) and 410.  Such group shall be known as a Permissive Aggregation Group.

In the case of a Permissive Aggregation Group, only a plan that is part of the Required Aggregation Group will be considered a Top Heavy Plan if the Permissive Aggregation Group is a Top Heavy Group.  No plan in the Permissive Aggregation Group will be considered a Top Heavy Plan if the Permissive Aggregation Group is not a Top Heavy Group.

(3)      Only those plans of the Employer in which the Determination Dates fall within the same calendar year shall be aggregated in order to determine whether such plans are Top Heavy Plans.

(4)      An Aggregation Group shall include any terminated plan of the Employer if it was maintained within the last five (5) years ending on the Determination Date.

(e)      "Determination Date" means (a) the last day of the preceding Plan Year, or (b) in the case of the first Plan Year, the last day of such Plan Year.

(f)       "Present Value of Accrued Benefit:" In the case of a defined benefit plan, a Participant's Present Value of Accrued Benefit shall be determined:

(1)      In the case of a Participant other than a Key Employee, using the single accrual method used for all plans of the Employer and Affiliated Employers, or if no such single method exists, using a method which results in benefits accruing not more rapidly than the slowest accrual rate permitted under Code Section 411(b)(1)(C).

(2)      As of the most recent "accrual valuation date", which is the most recent valuation date within a twelve (12) month period ending on the Determination Date.

(3)      For the first Plan Year, as if (a) the Participant terminated service as of the Determination Date; or (b) the Participant terminated service as of the actuarial valuation date, but taking into account the estimated Accrued Benefits as of the Determination Date.

(4)      For the second Plan Year, the Accrued Benefit taken into account for a current participant must not be less than the Accrued Benefit taken into account for the first Plan Year unless the difference is attributable to using an estimate of the Accrued Benefit as of the Determination Date for the first Plan year and using the actual Accrued Benefit for the second Plan Year.

(5)      For any other Plan Year, as if the Participant terminated service as of the actuarial valuation date.

(6)      The actuarial valuation date must be the same date used for computing the defined benefit plan minimum funding costs, regardless of whether a valuation is performed that Plan Year.

(g)      The calculation of a Participant's Present Value of Accrued Benefit as of a Determination Date shall be the sum of:

(1)      The Present Value of Accrued Benefit using the actuarial assumptions of Section 2.4, which assumptions shall be identical for all defined benefit plans being tested for Top Heavy Plan status.

(2)      Any Plan distributions made within the Plan Year that includes the Determination Date or within the four (4) preceding Plan Years.  However, in the case of distributions made after the valuation date and prior to the Determination Date, such distributions are not included as distributions for top heavy purposes to the extent that such distributions are already included in the Participant's Present Value of Accrued Benefit as of the valuation date.  Notwithstanding anything herein to the contrary, all distributions, including distributions made prior to January 1, 1984, and distributions under a terminated plan which if it had not been terminated would have been required to be included in an Aggregation Group, will be counted.  Further, benefits paid on account of death, to the extent such benefits do not exceed the Present Value of Accrued Benefits existing immediately prior to death, shall be treated as distributions for the purposes of this paragraph.

(3)      Any Employee contributions, whether voluntary or mandatory.  However, amounts attributable to tax deductible Qualified Voluntary Employee Contributions shall not be considered to be a part of the Participant's Present Value of Accrued Benefit.

(4)      With respect to unrelated rollovers and plan-to-plan transfers (ones which are both initiated by the Employee and made from a plan maintained by one employer to a plan maintained by another employer), if this Plan provides the rollovers or plan-to-plan transfers, it shall always consider such rollovers or plan-to-plan transfers as a distribution for the purposes of this Section.  If this Plan is the plan accepting such rollovers or plan-to-plan transfers, it shall not consider such rollovers or plan-to-plan transfers accepted after December 31, 1983, as part of the Participant's Present Value of Accrued Benefit.  However, rollovers or plan-to-plan transfers accepted prior to January 1, 1984, shall be considered as part of the Participant's Present Value of Accrued Benefit.

(5)      With respect to related rollovers and plan-to-plan transfers (ones either not initiated by the Employee or made to a plan maintained by the same employer), if this Plan provides the rollovers or plan-to-plan transfers, it shall not be counted as a distribution for purposes of this Section.  If this Plan is the plan accepting such rollovers or plan-to-plan transfers, it shall consider such rollovers or plan-to-plan transfers as part of the Participant's Present Value of Accrued Benefit, irrespective of the date on which such rollovers or plan-to-plan transfers are accepted.

(6)      For the purposes of determining whether two employers are to be treated as the same employer in (4) and (5) above, all employers aggregated under Code Section 414(b), (c), (m) or (o) are treated as the same employer.

(h)      "Top Heavy Group" means an Aggregation Group in which, as of the Determination Date, the sum of:

(1)      The Present Value of Accrued Benefits of Key Employees under all defined benefit plans included in the group, and

(2)      The Aggregate Accounts of Key Employees under all defined contribution plans included in the group, exceeds sixty percent (60%) of a similar sum determined for all Participants.

(i)       "Aggregate Account" means, with respect to each Participant, the value of all accounts maintained on behalf of a Participant, whether attributable to Employer or Employee contributions, used to determine Top Heavy Plan status under the provisions of a defined benefit contribution plan included in any Aggregation Group (as defined in this Plan).

(j)       "Key Employee" means an Employee as defined in Code Section 416(i) and the Regulations thereunder.  Generally, any Employee or former Employee (as well as each of his Beneficiaries) is considered a Key Employee if he, at any time during the Plan Year that contains the "Determination Date" or any of the preceding four (4) Plan Years, has been included in one of the following categories:

(1)      An officer of the Employer (as that term is defined within the meaning of the Regulations under Code Section 416) having annual "415 Compensation" greater than 50 percent of the amount in effect under Code Section 415(b)(1)(A) for any such Plan Year.

(2)      One of the ten employees having annual "415 Compensation" from the Employer for a Plan Year greater than the dollar limitation in effect under Code Section 415(c)(1)(A) for the calendar year in which such Plan Year ends and owning (or considered as owning within the meaning of Code Section 318) both more than one-half percent interest and the largest interests in the Employer.

(3)      A "five percent owner" of the Employer.  "Five percent owner" means any person who owns (or is considered as owning within the meaning of Code Section 318) more than five percent (5%) of the outstanding stock of the Employer or stock possessing more than five percent (5%) of the total combined voting power of all stock of the Employer or, in the case of any unincorporated business, any person who owns more than five percent (5%) of the capital or profits interest in the Employer.  In determining percentage ownership hereunder, employers that would otherwise be aggregated under Code Sections 414(b), (c), (m) and (o) shall be treated as separate employers.

(4)      A "one percent owner" of the Employer having an annual "415 Compensation" from the Employer of more than $150,000.  "One percent owner" means any person who owns (or is considered as owning within the meaning of Code Section 318) more than one percent (1%) of the outstanding stock of the Employer or stock possessing more than one percent (1%) of the total combined voting power of all stock of the Employer or, in the case of an unincorporated business, any person who owns more than one percent (1%) of the capital or profits interest in the Employer.  In determining percentage ownership hereunder, employers that would otherwise be aggregated under Code Sections 414(b), (c), (m) and (o) shall be treated as separate employers.  However, in determining whether an individual has "415 Compensation" of more than $150,000, "415 Compensation" from each employer required to be aggregated under Code Sections 414(b), (c), (m) and (o) shall be taken into account.

For purposes of this Section, the determination of "415 Compensation" shall be made by including amounts that would otherwise be excluded from a Participant's gross income by reason of the application of Code Sections 125, 402(a)(8), 402(h)(1)(B) and, in the case of Employer contributions made pursuant to a salary reduction agreement, by including amounts that would otherwise be excluded from a Participant's gross income by reason of the application of Code Section 403(b).

(k)      "Non-Key Employee" means any Employee or former Employee (and his Beneficiaries) who is not a Key Employee.

(l)       "Super Top Heavy Plan" means a plan described in Section 11.2.

(m)     "Top Heavy Plan" means a plan described in Section 11.2.

(n)      "Top Heavy Plan Year" means a Plan Year commencing after December 31, 1983 during which a portion of the Plan is a Top Heavy Plan.

    Section 11.3 - Vesting if a Portion of the Plan Becomes Top Heavy.

    Notwithstanding the vesting otherwise provided for in the Plan for any Top Heavy Plan Year, the Vested portion of the Accrued Benefit of any Non-Bargaining Unit Participant who has an Hour of Service after the Plan becomes top heavy shall be a percentage of such Participant's number of years of Service according to the following schedule:

Vesting Schedule

Years of Service                    Percentage

  0-2                                         0%

      3                                     100%

    If in any subsequent Plan Year, the portion of the Plan benefiting Non-Bargaining Unit Participants ceases to be a Top Heavy Plan, the Administrator shall revert to the vesting schedule in effect before this Plan became a Top Heavy Plan.  Any such reversion shall be treated as a Plan amendment pursuant to the terms of the Plan.

    Section 11.4 - Minimum Benefit Requirement If a Portion of the Plan Becomes Top Heavy.

(a)      The minimum Accrued Benefit derived from Employer contributions to be provided under this Section for each Non-Key Employee who is a Non-Bargaining Unit Participant during a Top Heavy Plan Year shall equal the product of (1) one-twelfth (1/12th) of "415 Compensation" averaged over the five (5) consecutive "limitation years" (or actual number of "limitation years", if less) which produce the highest average and (2) the lesser of (i) two percent (2%) multiplied by Plan Years of Service or (ii) twenty percent (20%).

(b)      For purposes of providing the minimum benefit under Code Section 416, a Non-Key Employee who is not a Non-Bargaining Unit Participant solely because (1) his Compensation is below a stated amount or (2) he declined to make mandatory contributions to the plan will be considered to be a Participant.  Furthermore, such minimum benefit shall be provided regardless of whether such Non-Key Employee is employed on a specified date.

(c)      For purposes of this Section, Plan years of Service for any Plan Year beginning before January 1, 1984, or for any Plan Year during which the Plan was not a Top Heavy Plan shall be disregarded.

(d)      For purposes of this Section, "415 Compensation" for any "limitation year" ending in a Plan Year which began prior to January 1,1984, subsequent to the last "limitation year" during which the Plan is a Top Heavy Plan, or in which the Participant failed to complete a Plan Year of Service, shall be disregarded.

(e)      For the purposes of this Section, "415 Compensation" shall be limited to $200,000 (unless adjusted in such manner as permitted under Code Section 415(d)).  However, for Plan Years beginning prior to January 1, 1989, the $200,000 limit shall apply only for Top Heavy Plan Years and shall not be adjusted.

(f)       If the Plan provides for the Normal Retirement Benefit to be paid in a form other than a single life annuity, the Accrued Benefit under this Section shall be the Actuarial Equivalent of the minimum Accrued Benefit under (a) above pursuant to Section 2.3.

(g)      If payment of the minimum Accrued Benefit commences at a date other than Normal Retirement Date, the minimum Accrued Benefit shall be the Actuarial  Equivalent of the minimum Accrued Benefit commencing at Normal Retirement Date pursuant to Section 2.3.

(h)      To the extent required to be nonforfeitable under this Plan, the minimum Accrued Benefit under this Section may not be forfeited under Code Section 411(a)(3)(B) or Code Section 411(a)(3)(D).

ARTICLE XII

RESTRICTIONS ON BENEFITS PAYABLE TO HIGHLY

COMPENSATED PARTICIPANTS

    Section 12.1 - IRS Limitations.  This Article sets forth limitations required by the Internal Revenue Service on the pension benefits payable to certain Participants.  It shall apply to a Participant only if his anticipated annual pension exceeds $1,500.00 and the Participant was among the 25 highest paid employees of the Company on (a) January 1, 1973; or (b) the date of the most recent amendment which substantially increased pension benefits (a "Substantive Amendment Date").  The limitations set forth in this Article shall become applicable if:

(a)      The Plan is terminated within ten years after January 1, 1973 (or a Substantive Amendment Date, if applicable);

(b)      The Pension of a Participant becomes payable within such ten year period, or

(c)      The Pension of a Participant becomes payable after such ten year period and the full current costs for the ten year period have not been funded.

    If subparagraph (b) above is applicable, the restrictions shall remain in effect until the later of the expiration of the ten year period or the date on which the full current costs have been funded.

    If a Participant is subject to the provisions of this Article, the Pension payable to him shall not exceed the Pension which can be provided from the greatest of the following:

(a)      The Company's contributions (or funds attributable thereto) which would have been applied to provide benefits for the Participant if the Plan had not been amended on the Substantive Amendment Date and had not continued without change;

(b)      $20,000.00; or

(c)      The sum of (1) the Company's contributions (or funds attributable thereto) which would have been applied to provide benefits for the Participant if the Plan had been terminated on the day before the Substantive Amendment Date (if applicable) and (2) an amount computed by multiplying the number of years for which the current costs of the Plan have been met after January 1, 1973 (or the Substantive Amendment Date, if applicable), by 20% of the first $50,000.00 of the Participant's average annual compensation during his last 5 years of employment.

    The limitations described above may be exceeded for the purposes of making current benefit payments to retired Participants who would otherwise be subject to such restrictions, provided that (a) the contributions which may be used for any such retired Participant in accordance with the restrictions heretofore indicated are applied to provide either a level amount of pension in the basic form of benefit provided for under the Plan for such Participant, or a level amount of pension in an optional form of benefit not greater in amount than the level amount of Pension under the basic form of benefit, and (b) the pension thus provided is supplemented by monthly payments to the extent necessary to provide the full pension in the basic form called for by the Plan, and (c) such supplemental payments are made only if the full current costs of the Plan have been met or if the aggregate of such supplemental payments for all such retired Participants does not exceed the aggregate Company contributions already made under the Plan in the year then current.

    The limitations in this Article shall automatically become inoperative and of no effect upon a ruling by the Internal Revenue Service that they are not required.

ARTICLE XIII

PLAN TERMINATION

    Section 13.1 - Right to Terminate.  In accordance with the procedures set forth in this Article, the Company and the Union have the right to terminate the Plan at any time.  In the event of the dissolution, merger, consolidation or reorganization of the Company, the Plan shall terminate and the Retirement Fund shall be liquidated unless the Plan is continued by a successor to the Company in accordance with Section 10.1.  Subject to applicable requirements, if any, of ERISA governing termination of "Employee Pension Benefit Plans," the Trustees shall liquidate the Retirement Fund in accordance with the provisions of this Article.

    Section 13.2 - Partial Termination.  Upon termination of the Plan with respect to a group of Participants which constitutes a partial termination of the Plan, the Trustees shall allocate for the benefit of the Eligible Employees then or theretofore employed by the Employer with respect to which the Plan is being terminated the proportionate interest of such Participants in the Retirement Fund in the manner and the order set forth in Section 4044 of ERISA.  The Actuary shall make this determination on the basis of the contributions made by the Company, the provisions of this Article, and such other considerations as the Actuary deems appropriate.  The Fiduciaries shall have no responsibility with respect to the determination of any such proportionate interest.

    Section 13.3 - Liquidation of Retirement Fund.  Upon termination of the Plan, or upon termination of employment of a group of Participants constituting a partial termination of the Plan, each such Participant's Accrued Benefit, based on his Accrual Service prior to the date of termination shall become fully vested and nonforfeitable to the extent funded.  Upon complete termination of the Plan, the assets of the Retirement Fund shall be liquidated (after provision is made for the expenses of liquidation), subject to the requirements of PBGC by the payment or provision for the payment of benefits in the following order of preference:

(a)      Certain Benefits Payable Three Years Prior to Termination: The available assets of the Retirement Fund shall first be allocated to provide pensions that became payable three or more years before the effective date of Plan termination, or that could have become payable at the beginning of such three year period had the Participant not deferred the commencement of his Pension by failing to elect earlier commencement, or that could have become payable had a Participant's retirement occurred immediately prior to the beginning of such three year period, provided that:

(i)       The portion of the pension payable to a Participant or the beneficiary of a Participant (or that could have been payable) shall be based on the provisions of the Plan in effect five years prior to the effective date of Plan termination; and for this purpose, the first Plan Year in which an amendment became effective, or was adopted, if later, shall constitute the first year an amendment was in effect; and further provided that:

(ii)      If the pension payable under the Plan had been reduced, either by amendment or due to the form in which the pension is being paid, during the three year period ending on the effective date of Plan termination, then the lowest benefit in pay status during such three year period shall be considered the benefit in pay status for purposes of this category (a).

(b)      Other Benefits Eligible for Termination Insurance: To the extent that the amount of a pension has not been provided in the foregoing category (a), the remaining assets shall be allocated to provide any pension provided under the Plan for a Participant whose employment terminated prior to the effective date of Plan termination, or any immediate or deferred pension that would have been payable to or on behalf of a Participant had his employment terminated for a reason other than death on the effective date of Plan termination, provided that the amount of a pension to be provided under this category (b) shall be determined as follows:

(i)       The portion of the pension payable to a Participant or the beneficiary of a Participant (or that could have been payable) based on the provisions of the Plan in effect five years prior to the effect date of Plan termination; and for this purpose, the first Plan Year in which an amendment became effective, or was adopted, if later, shall constitute the first year an amendment was in effect; plus

(ii)      The portion of the pension payable to a Participant or the beneficiary of a Participant which would have been included in (i) above had the Plan or a Plan amendment been in effect five years prior to the effective date of Plan termination, determined as follows: 20% for each Plan Year (less than five) that the Plan or an amendment thereto was in effect, multiplied by the amount that would have been included under subparagraph (1) for such Participant or beneficiary had the Plan or the  amendment been in effect for five Plan Years as of the effective date of Plan termination;

(iii)     No benefit payable under this category (b) to a Participant or beneficiary shall exceed an amount with an actuarial value of a monthly benefit in the form of a life only annuity commencing at age 65 equal to $750.00 multiplied by a fraction, the numerator of which is the contribution and benefit base determined under Section 230 of the Social Security Act in effect at the effective date of Plan termination and the denominator of which is such contribution and benefit base in effect in calendar year 1974.

(c)      Other Vested Benefits: To the extent that the amount of a pension has not been provided in the foregoing categories (a) and (b), the remaining assets in the Retirement Fund shall be allocated to provide the benefit payable under the Plan to or on behalf of a Participant whose employment terminated prior to the effective date of Plan termination, or that would have been payable to or on behalf of a Participant had his employment terminated for a reason other than death on the effective date of Plan termination, in the following order of preference:

(i)       to any Participant who had retired under Section 4.1 prior to the effective date of Plan termination or who was eligible to retire under said Section on the effective date of Plan termination;

(ii)      to any Participant who had retired under Section 4.3 prior to the effective date of Plan termination or who was eligible to retire under said Section on the effective date of Plan termination; or

(iii)     to any Participant whose employment had terminated with entitlement to a deferred vested pension under Section 4.4 prior to the effective date of Plan termination or who would have been eligible for a deferred vested pension under said Section had his employment terminated on the effective date of Plan termination.

(d)      Other Benefits: To the extent that the amount of pension has not been provided in the foregoing categories (a), (b) and (c), the remaining assets shall be allocated to provide the benefit accrued under the Plan, without regard to the satisfaction of the vesting requirements of this Plan, with respect to each Participant whose employment had not terminated as of the effective date of Plan termination, according to the respective actuarial value of each such Participant's Accrued Benefit.

    If the assets of the Retirement Fund applicable to any of the above categories are insufficient to provide full benefits for all persons in such group, the benefits otherwise payable to such persons shall be reduced proportionately.  The Actuary shall calculate the allocation of the assets of the Retirement Fund in accordance with the above priority categories, and certify his calculations to the Fiduciaries.  No liquidation of assets and payment of benefits (or provision therefor) shall actually be made by the Trustee until after it is advised by the Company in writing that applicable requirements, if any, of ERISA governing termination of "Employee Pension Benefit Plans" have been, or are being complied with or that appropriate authorizations, waivers, exemptions or variances have been, or are being, obtained.

    Section 13.4 - Manner of Distribution.  Subject to the foregoing provisions of Article XIII and applicable PBGC rules, any distribution after termination of the Plan may be made, in whole or in part, to the extent that no discrimination in value results, in cash, in securities or other assets in kind, or in non-transferable annuity contracts, as the Trustees, in their discretion, shall determine.

    Section 13.5 - Residual Amounts.  In no event shall the Company or any participating Employer receive any amounts from the Retirement Fund upon termination of the Plan.  After satisfaction of all liabilities of the Plan, any amounts which remain shall be distributed to Participants according to the following formula: To each Participant, a fraction of the Retirement Fund's residual assets equal to the fraction attained when the numerator is the Participant's total Years of Accrual Service and the denominator is the total years of Accrual Service for all Participants in the Plan.

ARTICLE XIV

CONSTRUCTION

    Section 14.1 - Construction.  The masculine gender, where appearing in the Plan, shall be deemed to include the feminine gender, and the singular may include the plural, unless the context clearly indicates to the contrary.  The words "hereof", "herein", "hereunder", and other similar compounds of the word "here" shall mean and refer to the entire Plan, not to any particular provision or Section.

    Section 14.2 - Authority of Trustees: In discharging the duties assigned to them under this Plan, the Trustees and, to the extent authority has been delegated to the Plan Administrator and his or her delegates, all of such persons and his or her delegates have the discretion and final authority to interpret and construe the terms of the Plan; to determine coverage and eligibility for benefits under the Plan; and to make all other determinations deemed necessary or advisable for the discharge of their duties or the administration of the Plan.  The discretionary authority of the Trustees, the Plan Administrator and their respective delegates is final, absolute, conclusive and exclusive, and binds all parties so long as it is exercised in good faith.  It is specifically intended that judicial review of any decision of the Trustees, the Plan Administrator or their delegates be limited to the arbitrary and capricious standard of review.

GRAPHIC COMMUNICATIONS                           BMC INDUSTRIES, INC.

INTERNATIONAL UNION, TWIN                        

CITIES LOCAL 6A

By: /s/C. David Jara                                                     By: /s/Brad Carlson
 

UNION TRUSTEES:                                                 COMPANY TRUSTEES:

/s/C. David Jara                                                           /s/Wesley S. Cohen

/s/Brian C. Moser                                                        /s/Dennis Malecek

/s/Richard W. Pruden                                                  /s/Brad Carlson

/s/Donald F. Schuldt                                                   /s/Cynthia Wingert

Dated as of this 18th day of June, 2002.

EX-10.48 9 exhibit_10-48.htm  

AMENDMENT 1

TO THE

SEVENTH RESTATED GRAPHIC COMMUNICATIONS

INTERNATIONAL UNION, TWIN CITIES

LOCAL 6A - BUCKBEE-MEARS PENSION PLAN

These amendments reflect the applicable provisions of the model amendments to comply with the Economic Growth and Tax Relief Reconciliation Act of 2001, as amended ("EGTRRA"), released by the Internal Revenue Service in IRS Notice 2001-57, are intended as good faith compliance with the requirements of EGTRRA, and are to be construed in accordance with EGTRRA and guidance issued thereunder.

Pursuant to Article IX of the Seventh Restated Graphic Communications International Union, Twin Cities Local 6A - Buckbee-Mears Pension Plan, hereinafter referred to as the "Plan", the Trustees hereby amend said Plan as follows:

I.

A new subsection 4.14(e) is hereby added to the Plan to read in its entirety as follows:

"(e)    (i)    Effective Date.  Notwithstanding the foregoing to the contrary, this section shall be effective for limitation years ending after December 31, 2001.

(ii)    Effect on Participants.  Benefit increases resulting from the increase in the limitations of section 415(b) of the Code will be provided to all employees participating in this Plan who have one (1) Hour of Service ending after December 31, 2001.

Definitions.

(iii)    Defined benefit dollar limitation.  The "defined benefit dollar limitation" is $160,000, as adjusted, effective January 1 of each year, under section 415(d) of the Code in such manner as the Secretary shall prescribe, and payable in the form of a straight life annuity.  A limitation as adjusted under section 415(d) of the Code will apply to limitation years ending with or within the calendar year for which the adjustment applies.

(iv)Maximum permissible benefit.  The "maximum permissible benefit" is the lesser of the defined benefit dollar limitation or defined benefit compensation limitation (both adjusted where required, as provided in (a) and, if applicable, in (b) or (c) below).

(a)    If the Participant has fewer than 10 years of participation in the Plan, the defined benefit dollar limitation shall be multiplied by a fraction, (i) the numerator of which is the number of years (or part thereof) of participation in the Plan and (ii) the denominator of which is 10.  In the case of a Participant who has fewer than 10 years of service with the employer, the defined benefit compensation limitation shall be multiplied by a fraction, (i) the numerator of which is the number of years (or part thereof) of service with the employer and (ii) the denominator of which is 10.

(b)    If the benefit of a Participant begins prior to age 62, the defined benefit dollar limitation applicable to the Participant at such earlier age is an annual benefit payable in the form of a straight life annuity beginning at the earlier age that is the actuarial equivalent of the defined benefit dollar limitation applicable to the Participant at age 62 (adjusted under (a) above, if required).  The defined benefit dollar limitation applicable at an age prior to age 62 is determined as the lesser of (i) the actuarial equivalent (at such age) of the defined benefit dollar limitation computed using the interest rate and mortality table (or other tabular factor) specified in Section 4.12(a) and (ii) the actuarial equivalent (at such age) of the defined benefit dollar limitation computed using a 5 percent interest rate and the applicable mortality table as defined in Section 4.12(a) of the Plan.  Any decrease in the defined benefit dollar limitation determined in accordance with this paragraph (b) shall not reflect a mortality decrement if benefits are not forfeited upon the death of the Participant.  If any benefits are forfeited upon death, the full mortality decrement is taken into account.

(c)    If the benefit of a Participant begins after the Participant attains age 65, the defined benefit dollar limitation applicable to the Participant at the later age is the annual benefit payable in the form of a straight life annuity beginning at the later age that is actuarially equivalent to the defined benefit dollar limitation applicable to the Participant at age 65 (adjusted under (a) above, if required).  The actuarial equivalent of the defined benefit dollar limitation applicable at an age after age 65 is determined as (i) the lesser of the actuarial equivalent (at such age) fo the defined benefit dollar limitation computed using the interest rate and mortality table (or other tabular factor) specified in Section 4.12(a) of the Plan and (ii) the actuarial equivalent (at such age) of the defined benefit dollar limitation computed using a 5 percent interest rate assumption and the applicable mortality table as defined in Section 4.12(a) of the Plan.  For these purposes, mortality between age 65 and the age at which benefits commence shall be ignored.

II.

A new subsection 4.12(c) is hereby added to the Plan to read in its entirety as follows:

"(c)    Effective for distributions made after December 31, 2001, for purposes of the direct rollover provisions of this Section 4.12, an eligible retirement plan shall also mean an annuity contract described in section 403(b) of the Code and an eligible plan under section 457(b) of the Code which is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state and which agrees to separately account for amounts transferred into such plan from this Plan.  The definition of eligible retirement plan shall also apply in the case of a distribution to a surviving spouse, or to a spouse or former spouse who is the alternate payee under a qualified domestic relations order, as defined in section 414(p) of the Code."

III.

Section 11.5 is hereby added to the Plan to read in its entirety as follows:

11.5  Modifications of Top-Heavy Rules effective after December 31, 2001.

(a) Effective date.  This section shall apply for purposes of determining whether the Plan is a top-heavy plan under section 416(g) of the Code for Plan Years beginning after December 31, 2001, and whether the Plan satisfies the minimum benefits requirements of section 416(c) of the Code for such years.  This section amends Article XI of the Plan.

(b)Determination of top-heavy status.

1.    Key employee.  Key employee means any employee or former employee (including any deceased employee) who at any time during the Plan Year that includes the determination date was an officer of the employer having annual compensation greater than $130,000 (as adjusted under section 416(i)(1) of the Code for Plan Years beginning after December 31, 2002), a 5-percent owner of the employer, or a 1-percent owner of the employer having annual compensation of more than $150,000.  For this purpose, annual compensation means compensation of more than $150,000.  For this purpose, annual compensation means compensation within the meaning of section 415(c)(3) of the Code.  The determination of who is a key employee will be made in accordance with section 416(i)(1) of the Code and the applicable regulations and other guidance of general applicability issued thereunder.

2.    Determination of present values and amounts.  This section (b)(2) shall apply for purposes of determining the present values of accrued benefits and the amounts of account balances of employees as of the determination date.

(i)    Distributions during year ending on the determination date.  The present values of accrued benefits and the amounts of account balances of an employee as of the determination date shall be increased by the distributions made with respect to the employee under the Plan and any plan aggregated with the Plan under section 416(g)(2) of the Code during the 1-year period ending on the determination date.  The preceding sentence shall also apply to distributions under a terminated plan which, had it not been terminated, would have been aggregated with the Plan under section 416(g)(2)(A)(i) of the Code.  In the case of a distribution made for a reason other than separation from service, death, or disability, this provision shall be applied by substituting 5-year period for 1-year period.

(ii)    Employees not performing services during year ending on the determination date.  The accrued benefits and accounts of any individual who has not performed services for the employer during the 1-year period ending on the determination date shall not be taken into account.

(c)    Minimum benefits.  For purposes of satisfying the minimum benefit requirements of section 416(c)(1) of the Code and the Plan, in determining years of service with the employer, any service with the employer shall be disregarded to the extent that such service occurs during a Plan Year when the Plan benefits (within the meaning of section 410(b) of the Code) no key employee or former key employee.

IV.

Except as amended herein, the terms and provisions of the Seventh Restated Graphic Communications International Union, Twin Cities Local 6A - Buckbee-Mears Pension Plan, shall be and remain in full force and effect.

V.

This Amendment shall be effective as provided herein.

IN WITNESS WHEREOF, the Trustees have caused this Amendment 1 to the Seventh Restated Graphic Communications International Union, Twin Cities Local 6A - Buckbee-Mears Pension Plan to be executed as of this 30st  day of December, 2002.

GRAPHIC COMMUNICATIONSBMC INDUSTRIES, INC.

INTERNATIONAL UNION, TWIN

CITIES LOCAL 6A

By:  /s/C. David Jara                                       By: /s/Brad Carlson

UNION TRUSTEES:                                           COMPANY TRUSTEES:

/s/C. David Jara                                                   /s/Wesley S. Cohen

/s/Brian C. Moser                                                /s/Dennis Malecek

/s/Richard W. Pruden                                           /s/Brad Carlson

/s/Donald F. Schuldt                                            /s/John Oyen

Dated this 31st day of December, 2002.

EX-21.1 10 exhibit_21-1.htm

EXHIBIT 21-1

SUBSIDIARIES

OF

BMC INDUSTRIES, INC.

1.     Buckbee-Mears Europe GmbH

2.     Buckbee-Mears Hungary Kft.

3.     Buckbee-Mears Medical Technologies, LLC

4.     Vision-Ease Lens, Inc.

5.     Vision-Ease Lens Azusa, LLC

6.     Vision Ease Lens Limited

7.     Vision-Ease Canada, Ltd.

8.     P. T. Vision-Ease Asia, joint venture with P.T. Astron Lensindo Nusa

9.     Buckbee-Mears Holding Company B.V.

10.   Buckbee-Mears European Holding Company B.V.

11.   Buckbee-Mears Deutschland Holding GmbH & Company KG

12.   Vision-Ease France SAS

13.   Vision-Ease Deutschland GmbH

14.   Buckbee-Mears Deutschland Verwaltungs GmbH

15.   Buckbee-Mears Netherlands B.V.

EX-23.1 11 exhibit_23-1.htm

Exhibit 23.1

Consent of Independent Auditors

We consent to the incorporation by reference in the Registration Statement (Form S-8 No. 33-55089) pertaining to the BMC Industries, Inc. 1994 Stock Incentive Plan, in the Registration Statement (Form S-8, No. 33-38684) pertaining to the BMC Industries, Inc. Restated and Amended 1994 Stock Incentive Plan and in the Registration Statement (Form S-8, No. 333-81952) pertaining to the BMC Industries, Inc. Savings and Profit Sharing Plan of our report dated January 31, 2003 with respect to the consolidated financial statements of BMC Industries, Inc. included in the Annual Report (Form 10-K) for the year ended December 31, 2002.

/s/Ernst & Young LLP

Minneapolis, Minnesota

March 25, 2003

EX-99.1 12 exhibit_99-1.htm

EXHIBIT 99.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS 

ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of BMC Industries Inc (the "Company") on Form 10-K for the period ended December 31, 2002 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Douglas C. Hepper, Chief Executive Officer of the Company, certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

     1)       The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

     2)       The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

March 26, 2003

/s/Douglas C. Hepper

Douglas C. Hepper

Chairman, President and

Chief Executive Officer

EX-99.2 13 exhibit_99-2.htm

EXHIBIT 99.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS 

ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of BMC Industries Inc (the "Company") on Form 10-K for the period ended December 31, 2002 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Curtis E. Petersen, Chief Financial Officer of the Company, certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

     1)       The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

     2)       The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

March 25, 2003

/s/Curtis E. Petersen

Curtis E. Petersen

Senior Vice President and

Chief Financial Officer 

-----END PRIVACY-ENHANCED MESSAGE-----

EX-10.2

BMC INDUSTRIES, INC.
SAVINGS AND PROFIT SHARING PLAN

Fifth Declaration of Amendment

Pursuant to the retained power of amendment contained in Section 11.2 of the BMC Industries, Inc. Savings and Profit Sharing Plan, the undersigned hereby amends the Plan by way of restatement in the manner set forth in the instrument entitled "BMC Industries, Inc. Savings and Profit Sharing Plan - 2001 Revision" (the "Plan") attached hereto.

Except as otherwise specifically provided in the Plan, the foregoing amendment is effective as of the Restatement Date as defined in the Plan.

Dated:  November 30, 2001.

	BMC INDUSTRIES, INC.
Attest: /s/Jon A. Dobson	By:  /s/Bradley D. Carlson
Secretary	Its:  Treasurer

ARTICLE 1.  Description and Purpose...................................................... 1

1.1.  Plan Name......................................................................................................... 1

1.2.  Plan Description............................................................................................... 1

1.3.  Plan Background.............................................................................................. 1

ARTICLE 2.  Eligibility..................................................................................... 3

2.1.  Eligibility Requirements................................................................................... 3

2.2.  Entry Date......................................................................................................... 3

2.3.  Special Entry Dates.......................................................................................... 4

2.4.  Transfer Among Participating Employers or Business Units.......................... 4

2.5.  Multiple Employment....................................................................................... 4

2.6.  Reentry.............................................................................................................. 4

2.7.  Condition of Participation............................................................................... 4

2.8.  Termination of Participation........................................................................... 4

ARTICLE 3.  Contributions............................................................................ 5

3.1.  401(k) Contributions........................................................................................ 5

3.2.  After-Tax Contributions................................................................................... 6

3.3.  Matching Contributions................................................................................... 7

3.4.  Profit Sharing Contributions........................................................................... 9

3.5.  Rollovers......................................................................................................... 11

3.6.  Corrective Contributions............................................................................... 11

ARTICLE 4.  Accounts and Valuation.................................................... 13

4.1.  Establishment of Accounts.............................................................................. 13

4.2.  Valuation and Account Adjustment................................................................ 13

4.3.  Allocations Do Not Create Rights.................................................................. 13

ARTICLE 5.  Participant Investment Direction................................ 15

5.1.  Establishment of Investment Funds................................................................ 15

5.2.  Contribution Investment Directions............................................................... 15

5.3.  Transfer Among Investment Funds................................................................. 16

5.4.  BMC Common Stock Fund.............................................................................. 16

5.5.  Investment Direction Responsibility Resides With Participants................... 17

5.6.  Beneficiaries and Alternate Payees............................................................... 17

ARTICLE 6.  Withdrawals During Employment and Loans......... 18

6.1.  Hardship Withdrawals from 401(k) Contribution Account............................ 18

6.2.  Withdrawals from 401(k) Contribution Account After Attaining Age 591/2 ... 19

6.3.  Withdrawals from After-Tax Contribution Account....................................... 20

6.4.  Withdrawals from Rollover Account.............................................................. 20

6.5.  Rules for Withdrawals.................................................................................... 20

6.6.  No Other In-Service Withdrawals.................................................................. 20

6.7.  Plan Loans...................................................................................................... 21

ARTICLE 7.  Vesting and Forfeitures..................................................... 23

7.1.  Vesting............................................................................................................ 23

7.2.  Forfeiture Upon Distribution......................................................................... 25

7.3.  Other Forfeitures............................................................................................ 25

7.4.  Application of Forfeitures.............................................................................. 26

ARTICLE 8.  Distributions After Termination................................... 27

8.1.  Form and Time of Distribution...................................................................... 27

8.2.  Beneficiary Designation................................................................................. 29

8.3.  Assignment, Alienation of Benefits................................................................. 30

8.4.  Payment in Event of Incapacity...................................................................... 30

8.5.  Payment Satisfies Claims............................................................................... 31

8.6.  Disposition if Distributee Cannot be Located............................................... 31

8.7.  Direct Rollovers and Transfers...................................................................... 31

ARTICLE 9.  Contribution Limitations................................................... 32

9.1.  401(k) Contribution Dollar Limitation.......................................................... 32

9.2.  Actual Deferral Percentage Limitations........................................................ 32

9.3.  Actual Contribution Percentage Limitations................................................. 35

9.4.  Multiple Use Limitation................................................................................. 37

9.5.  Earnings or Losses on Excess Contributions................................................. 39

9.6.  Annual Additions Limitation........................................................................... 39

9.7.  Administrator's Discretion............................................................................. 41

ARTICLE 10.  Service Rules.......................................................................... 42

10.1.  Vesting Service............................................................................................. 42

10.2.  One-Year Break in Service........................................................................... 42

10.3.  Loss of Service.............................................................................................. 42

10.4.  Pre-Acquisition Service................................................................................ 43

10.5.  Hour of Service............................................................................................. 43

ARTICLE 11.  Adoption, Amendment and Termination................... 46

11.1.  Adoption by Affiliated Organizations........................................................... 46

11.2.  Authority to Amend and Procedure.............................................................. 46

11.3.  Authority to Terminate and Procedure........................................................ 46

11.4.  Vesting Upon Termination, Partial Termination or Discontinuance of Contributions..................................................................................................... 47

11.5.  Distribution Following Termination, Partial Termination or Discontinuance of Contributions....................................................................... 47

ARTICLE 12.  PLAN ADMINISTRATION........................................................... 48

12.1.  Administrator, Named Fiduciary.................................................................. 48

12.2.  Committee..................................................................................................... 48

12.3.  Administrative Duties................................................................................... 50

12.4.  Delegation.................................................................................................... 50

12.5.  Reports and Records..................................................................................... 50

12.6.  Compensation............................................................................................... 51

12.7.  Professional Assistance................................................................................ 51

12.8.  Payment of Administrative Costs................................................................. 51

12.9.  Indemnification............................................................................................. 51

12.10.  Claims Procedure....................................................................................... 51

12.11.  Disputes...................................................................................................... 52

12.12.  Correction of Errors................................................................................... 53

12.13.  Standards for Elections, Directions and Similar Actions.......................... 53

ARTICLE 13.  Miscellaneous....................................................................... 54

13.1.  Merger, Consolidation, Transfer of Assets.................................................. 54

13.2.  Limited Reversion of Fund........................................................................... 54

13.3.  Top-Heavy Provisions.................................................................................. 54

13.4.  Qualified Military Service........................................................................... 58

13.5.  Short Plan Years........................................................................................... 60

ARTICLE 14.  Construction, Interpretations AND DEFINITIONS.. 61

14.1.  Construction and Interpretations................................................................. 61

14.2.  Definitions.  ................................................................................................. 62

ADDENDUM SPECIAL EFFECTIVE DATES  ...................................................... A-1

BMC INDUSTRIES, INC.
SAVINGS AND PROFIT SHARING PLAN

2001 Revision

BMC INDUSTRIES, INC.
SAVINGS AND PROFIT SHARING PLAN

2001 Revision

ARTICLE 1. Description and Purpose

1.1.          Plan Name.  The name of the Plan is the "BMC Industries, Inc. Savings and Profit Sharing Plan."

1.2.           Plan Description.  The Plan is a profit sharing plan providing for 401(k) Contributions pursuant to a qualified cash or deferred arrangement, After-Tax Contributions, Matching Contributions, and Profit Sharing Contributions.  The Plan is intended to qualify under Code section 401(a) and to satisfy the requirements of Code sections 401(k) and 401(m).  Although the Plan is a profit sharing plan, a Participating Employer may make contributions to the Plan even though it has no current or accumulated earnings or profits.

1.3.           Plan Background.

(a)             The Company adopted the established Plan effective as of April 1, 1979, as an employee thrift and profit sharing plan with after-tax employee contributions and employer matching contributions made from current or accumulated profits.

(b)            Effective generally as of July 1, 1984, the Plan was restated in the manner set forth in the 1984 Restatement to provide, among other things, for the investment of employer matching contributions in Company Stock.

(c)             Effective generally as of July 1, 1985, the Plan was restated in the manner set forth in the 1985 Revision for purposes of incorporating into the Plan a cash or deferred arrangement pursuant to Code section 401(k).

(d)            Effective generally as of January 1, 1987, the Plan was restated in the manner set forth in the 1987 Revision to satisfy the requirements of the Tax Reform Act of 1986.

(e)             Effective generally as of January 1, 1994, the Plan was restated in the manner set forth in the 1994 Revision to comply with changes in applicable law and make certain other miscellaneous changes.

(f)               Effective as of the close of business on August 31, 1998, the BMC Industries, Inc. Profit Sharing Plan was merged into the Plan.  To reflect the merger and changes in applicable law, including the Small Business Job Protection Act of 1996, the Uruguay Round Agreements Act of 1994 and the Uniformed Services Employment and Reemployment Rights Act of 1994, and to make other miscellaneous changes to the Plan, the Plan was restated effective generally as of September 1, 1998 and, in connection therewith, the name of the Plan was changed to the BMC Industries, Inc. Savings and Profit Sharing Plan.

(g)              The Plan was amended and restated effective as of the Restatement Date for law changes as required by the Taxpayer Relief Act of 1997, the Internal Revenue Restructuring and Reform Act of 1998 and the Community Renewal Tax Relief Act of 2000, collectively (along with changes made to the Plan in the 1998 revision) referred to as the "GUST" amendments, and to make certain other miscellaneous changes.

ARTICLE 2. Eligibility

2.1.          Eligibility Requirements.

(a)             An Employee who was a Participant in the Plan the day before the Restatement Date shall continue as a Participant in the Plan.

(b)            An Employee who is a Qualified Employee is eligible to participate in the Plan

(i)              for the purposes of making 401(k) Contributions, After-Tax Contributions and a rollover contribution pursuant to Section 3.5, on the day on which he or she first completes an Hour of Active Service; and

(ii)            for the purposes of having Matching Contributions and Profit Sharing Contributions made on his or her behalf, on the last day of the first "eligibility service period" during which he or she completes at least 1000 Hours of Service.  An Employee's "eligibility service period" is the 12-month period that starts on the day on which he or she first completes an Hour of Active Service and, if the Employee fails to complete at least 1000 Hours of Service during this period, Plan Years, beginning with the Plan Year that includes the first anniversary of the day on which he or she first completes an Hour of Active Service. 

2.2.           Entry Date.

(a)             An Employee will enter the Plan as an Active Participant for the purposes of making 401(k) Contributions, After-Tax Contributions and a rollover contribution pursuant to Section 3.5, on the day on which he or she first completes an Hour of Active Service as a Qualified Employee.

(b)            An Employee will enter the Plan as an Active Participant for the purposes of having Matching Contributions made on his or her behalf on the first day of the calendar quarter that falls on or first follows the day on which he or she satisfies the applicable eligibility requirements specified in Section 2.1(b)(ii), if he or she is a Qualified Employee on the day on which he or she would otherwise enter the Plan.

(c)             An Employee will enter the Plan as an Active Participant for the purposes of having Profit Sharing Contributions made on his or her behalf, as of the January 1 that falls on or last precedes the day on which he or she satisfies the applicable eligibility requirements specified in Section 2.1(b)(ii), if he or she is a Qualified Employee on the last day of the eligibility service period.

(d)             If an Employee described in Section 2.1(b)(ii) terminates employment before the day on which he or she would otherwise be eligible to enter the Plan for the purposes of having Matching Contributions and Profit Sharing Contributions made on his or her behalf and again becomes an Employee after that day, then:

(i)              if he or she terminated employment before satisfying the eligibility requirements specified in Section 2.1(b)(ii), he or she will be treated as a new Employee and his or her previous service will be disregarded in determining his or her new eligibility service period pursuant to Section 2.1(b)(ii); or

(ii)            if he or she terminated employment after satisfying the eligibility requirements specified in Section 2.1(b)(ii), he or she will enter the Plan as an Active Participant as of the first following day on which he or she completes an Hour of Active Service as a Qualified Employee.

(e)             If an Employee is not a Qualified Employee on the day on which he or she would otherwise enter the Plan for a particular purpose, he or she will enter the Plan as an Active Participant for that purpose on the first following day on which he or she completes an Hour of Active Service as a Qualified Employee.

2.3.           Special Entry Dates.  Notwithstanding Sections 2.1 and 2.2, in conjunction with an acquisition, the Company's Board may specify a special entry date for one or more purposes for individuals who become Qualified Employees on account of the acquisition.

2.4.           Transfer Among Participating Employers or Business Units.  A Participant who transfers from one Participating Employer or Participating Business Unit to another Participating Employer or Participating Business Unit as a Qualified Employee will participate in the Plan for the Plan Year during which the transfer occurs on the basis of his or her separate Eligible Earnings for the Plan Year from each Participating Employer or Participating Business Unit, as the case may be.

2.5.           Multiple Employment.  A Participant who is simultaneously employed as a Qualified Employee with more than one Participating Employer will participate in the Plan as a Qualified Employee of all of his or her Participating Employers on the basis of his or her separate Eligible Earnings from each Participating Employer.

2.6.          Reentry.  A Participant who ceases to be a Qualified Employee will resume active participation in the Plan on the first day on which he or she completes an Hour of Active Service as a Qualified Employee.

2.7.           Condition of Participation.  Each Qualified Employee, as a condition of participation, is bound by all of the terms and conditions of the Plan and must furnish to the Administrator such pertinent information and execute such instruments as the Administrator may require.

2.8.           Termination of Participation.  A Participant will cease to be a Participant as of the later of the date on which:

(a)              he or she ceases to be a Qualified Employee; or

(b)             all benefits, if any, to which he or she is entitled under the Plan have been forfeited or distributed.

ARTICLE 3. Contributions

3.1.           401(k) Contributions.

(a)             Subject to the limitations described in Article 9, for each Plan Year an Active Participant may elect to make 401(k) Contributions for the Plan Year in accordance with the succeeding provisions of this section.  401(k) Contributions will be paid by the Participating Employer to the Trustee as soon as administratively practicable after the date on which the Active Participant would have received the Eligible Earnings but for his or her election pursuant to this section.

(b)            A reference in this section to an election to make 401(k) Contributions means that the Participant has elected to have his or her Eligible Earnings reduced in consideration of the Participating Employer's obligation to make 401(k) Contributions in the same amount on the Participant's behalf.  Except as provided in Subsection (c), a Participant's 401(k) Contributions will be made in accordance with the rules in this subsection. 

(i)              An Active Participant may elect to make 401(k) Contributions in any one percent increment from one percent to a maximum percentage specified in Plan Rules and the elected percentage will automatically apply to the Active Participant's Eligible Earnings as adjusted from time to time.  Plan Rules may specify a maximum percentage for Active Participants who are Highly Compensated Employees that is less than the maximum percentage specified for Active Participants who are not Highly Compensated Employees.  No 401(k) Contributions will be made on behalf of a Participant with respect to a period during which he or she is not an Active Participant.  

(ii)         An Active Participant's election to commence 401(k) Contributions pursuant to clause (i) will become effective at the time and manner specified in Plan Rules after the Administrator receives a complete and accurate election. (iii)        An Active Participant may elect to change the percentage rate of his or her 401(k) Contributions.  The election will become effective at the time and manner specified in Plan Rules after the Administrator receives a complete and accurate election of such change. (iv)         401(k) Contributions for an Active Participant who makes a hardship withdrawal pursuant to Section 6.1 will be automatically suspended for the 12-month period beginning on the date of the withdrawal distribution.  Following the suspension period the Active Participant may again elect to make 401(k) Contributions in accordance with clause (iii).

(c)              Only Eligible Earnings payable after an Active Participant's complete and accurate election has been received and become effective will be reduced pursuant to the election.  If any election is not processed on a timely basis, or if, for any reason, an Active Participant's Eligible Earnings are not reduced in accordance with the Participant's election, no retroactive adjustments will be made to take into account the effect of any such delay or failure.  Plan Rules, however, may permit an Active Participant to elect to make 401(k) Contributions from his or her Eligible Earnings payable during any remaining portion of the Plan Year during which the delay or failure occurred at more than the otherwise applicable maximum percentage to adjust for the effect of the delay or failure so long as the total reductions for the Plan Year do not exceed the applicable maximum percentage or the limitations described in Article 9.

3.2.           After-Tax Contributions.

(a)              Subject to the limitations described in Article 9, an Active Participant may make After-Tax Contributions in accordance with this section.  After-Tax Contributions will be paid to the Trustee as soon as administratively practicable after the date on which the Active Participant would have received the Eligible Earnings but for his or her election pursuant to this section.

(b)             Except as provided in Subsection (c), After-Tax Contributions will be made in accordance with the rules in this subsection.

(i)              An Active Participant may elect to contribute any one percent increment of his or her Eligible Earnings from one percent to a maximum percentage specified in Plan Rules and the elected percentage will automatically apply to the Active Participant's Eligible Earnings as adjusted from time to time.  Plan Rules may specify a maximum percentage applicable to After-Tax Contributions, an aggregate maximum percentage applicable to After-Tax Contributions and 401(k) Contributions or both.  In addition, Plan Rules may specify a lower maximum percentage (which, for After-Tax Contributions, may be zero) for Active Participants who are Highly Compensated Employees.  Neither deductions from Eligible Earnings nor After-Tax Contributions will be made on behalf of a Participant with respect to a period during which he or she is not an Active Participant.

(ii)            An Active Participant's election to have After-Tax Contributions commence will become effective at the time and manner specified in Plan Rules after the date on which the Administrator receives a complete and accurate election.

(iii)          An Active Participant may elect to change the percentage rate of his or her After-Tax Contributions.  The election will become effective at the time and manner specified in Plan Rules after the Administrator receives a complete and accurate election of such change.

(iv)          After-Tax Contributions by an Active Participant who makes a hardship withdrawal under Section 6.1 will be automatically suspended for the 12-month period beginning on the date of the withdrawal distribution.  Following the suspension period, the Active Participant may again elect to have After-Tax Contributions commence in accordance with clause (ii).

(c)              Elections pursuant to this section and After-Tax Contributions must be made in accordance with and are subject to Plan Rules.  Only Eligible Earnings payable after an Active Participant's complete and accurate election has been received and become effective will be subject to deduction pursuant to the election.  If any election is not processed on a timely basis, or if, for any reason, an Active Participant's After-Tax Contributions are not made in accordance with the Participant's election, no retroactive adjustments will be made to take into account the effect of any such delay or failure.  Plan Rules, however, may permit an Active Participant to make After-Tax Contributions during any remaining portion of the Plan Year during which the delay or failure occurred at more than the otherwise applicable maximum percentage to adjust for the effect of the delay or failure so long as the After-Tax Contributions for the Plan Year do not exceed the applicable maximum percentage or the limitations described in Article 9.

3.3.           Matching Contributions. 

(a)             Subject to Subsection (d) and the limitations described in Article 9, the Participating Employer of an eligible Active Participant will make a Matching Contribution on behalf of the Active Participant for a calendar quarter in an amount, if any, equal to 25 percent of the lesser of (i) the Participant's 401(k) Contributions for the calendar quarter and (ii) six percent of the Participant's Eligible Earnings for the calendar quarter.  To be eligible to share in the Participating Employer's Matching Contribution for a given calendar quarter, a Participant must have, on or before the last day of the calendar quarter, entered the Plan as a Participant for the purposes of having Matching Contributions made on his or her behalf, received Eligible Earnings for the calendar quarter from the Participating Employer and is a Participant who either:

(i)               is a Qualified Employee who is either on active status or paid leave of absence on the last day of the calendar quarter or

(ii)             terminated employment during the calendar quarter

(1)            at or after his or her Normal Retirement Date

(2)            on account of his or her death

(3)            on account of his or her becoming Disabled or

(4)            following his or her attainment of age 60 if the sum of his or her age and years of Vesting Service equals or exceeds 65;

provided, that this condition will be applied only with respect to a Participant, such sole application being made for the calendar quarter during which this clause (ii) first applies and the condition under clause (i) is not satisfied.

(b)            Subject to Subsection (d) and the limitations described in Article 9, the Participating Employer of an eligible Active Participant will make a Matching Contribution on behalf of the Active Participant for a Plan Year in an amount, if any, equal to a percentage, determined by the Participating Employer's Board, of the lesser of (i) the Participant's 401(k) Contributions for the Plan Year and (ii) six percent of the Participant's Eligible Earnings for the Plan Year; provided that the percentage may be different for eligible Active Participants employed in different Participating Business Units of the Participating Employer based on annual profit performance of each Participating Business Unit, as determined by the Participating Employer's Board.  To be eligible to share in the Participating Employer's Matching Contribution for a given Plan Year, a Participant must have, on or before the last day of the Plan Year, entered the Plan as a Participant for the purposes of having Matching Contributions made on his or her behalf, received Eligible Earnings for the Plan Year from the Participating Employer and is a Participant who:

(i)              is a Qualified Employee who is either on active status or paid leave of absence on the last day of the Plan Year or

(ii)            terminated employment during the Plan Year

(1)            at or after his or her Normal Retirement Date

(2)            on account of his or her death

(3)            on account of his or her becoming Disabled or

(4)            following his or her attainment of age 60 if the sum of his or her age and years of Vesting Service equals or exceeds 65;

provided, that this condition will be applied only with respect to a Participant, such sole application being made for the Plan Year during which this clause (ii) first applies and the condition under clause (i) is not satisfied.

(c)              A Participating Employer's Matching Contributions for a Plan Year will be paid to the Trustee on such date or dates during or following such Plan Year as the Participating Employer may elect but in no case more than 12 months after the end of the Plan Year. 

(d)             No Matching Contribution will be made with respect to any portion of a Participant's 401(k) Contributions returned to the Participant pursuant to Article 9.  For this purpose, 401(k) Contributions with respect to which no Matching Contributions are made for a Plan Year will be deemed to be the first such contributions returned to the Participant.  If the Administrator determines that Matching Contributions that have been added to a Participant's Account should not have been added by reason of this subsection, the contributions, increased by Fund earnings or decreased by Fund losses attributable to the contributions, as determined under Section 9.5, will be subtracted from the Account as soon as administratively practicable after the determination is made and will be applied to satisfy the contribution obligations of the Participating Employer that made the excess contributions for the Plan Year for which the excess contributions were made.  If, because of the passage of time, the excess cannot be applied in this way, the excess will be allocated, in the discretion of the Administrator:

(i)              among the Matching Contribution Accounts of all Participants who made 401(k) Contributions for the Plan Year as Qualified Employees of the Participating Employer in proportion to such 401(k) Contributions up to six percent of Eligible Earnings; or

(ii)            as a corrective contribution pursuant to Section 3.6.

3.4.          Profit Sharing Contributions.

(a)             Each Participating Employer will make a Profit Sharing Contribution for a Plan Year on behalf of Participants who have satisfied the eligibility conditions specified in Subsection (b) for a Plan Year in an amount equal to the sum of:

(i)              three percent of the aggregate Eligible Earnings for the Plan Year of all Participants eligible to share in the contribution for the Plan Year plus

(ii)            an additional amount, if any, separately determined by the Participating Employer's Board for each of its Participating Business Units based on the annual profit performance of each Participating Business Unit.

(b)            To be eligible to share in the Participating Employer's Profit Sharing Contribution, for a particular Plan Year, a Participant must have, on or before the last day of the Plan Year, entered the Plan as a Participant for the purposes of having Profit Sharing Contributions made on his or her behalf, received Eligible Earnings for the Plan Year from the Participating Employer and either:

(i)              completed at least 1000 Hours of Service during the Plan Year and been employed with an Affiliated Organization as a Qualified Employee who is either on active status or paid leave of absence on the last day of the Plan Year or

(ii)            terminated employment during the Plan Year

(1)            at or after his or her Normal Retirement Date

(2)            on account of his or her death

(3)            on account of his or her becoming Disabled or

(4)            following his or her attainment of age 60 if the sum of his or her age and years of Vesting Service equals or exceeds 65;

provided, that this condition will be applied only with respect to a Participant, such sole application being made for the Plan Year during which this clause (ii) first applies and the condition under clause (i) is not satisfied.

(c)             Subject to the limitations described in Article 9, a Participating Employer's Profit Sharing Contribution for a Plan Year will be allocated among the Profit Sharing Contribution Accounts of Participants who have satisfied the eligibility conditions under Subsection (b) for the Plan Year as follows:

(i)              The Participating Employer's contribution described in Subsection (a)(i) will be allocated to each eligible Participant in the same proportion that his or her Eligible Earnings for the Plan Year bears to the aggregate Eligible Earnings for the Plan Year of all Participants eligible to share in the Participating Employer's contribution.

(ii)            The Participating Employer's contribution described in Subsection (a)(ii) with respect to a given Participating Business Unit will be allocated to each eligible Participant who received Eligible Earnings for the Plan Year with respect to services for the Participating Business Unit (other than administrative services with respect to which he or she is included in the Corporate Participating Business Unit unless the contribution relates to the Corporate Participating Business Unit) as follows:

(1)            An amount equal to three percent of his or her Excess Eligible Earnings for the Plan Year.  If, however, the contribution is less than three percent of the aggregate Excess Eligible Earnings of all Participants eligible to share in the contribution with respect to the Participating Business Unit, the contribution will be allocated to each such eligible Participant in the same proportion that his or her Excess Eligible Earnings for the Plan Year bears to the aggregate Excess Eligible Earnings for the Plan Year of all Participants eligible to share in the contribution with respect to the Participating Business Unit.

(2)            To the extent the contribution is not exhausted after it has been allocated under clause (1), each eligible Participant's share of the remainder will be an amount equal to two and seven-tenths percent of the sum of his or her Eligible Earnings plus his or her Excess Eligible Earnings for the Plan Year.  If, however, the contribution is less than two and seven-tenths percent of the sum of the aggregate Eligible Earnings plus the aggregate Excess Eligible Earnings of all Participants eligible to share in the contribution with respect to the Participating Business Unit, the contribution will be allocated to each such eligible Participant in the same proportion that the sum of his or her Eligible Earnings plus his or her Excess Eligible Earnings for the Plan Year bears to the sum of the aggregate Eligible  Earnings plus the aggregate Excess Eligible Earnings for the Plan Year of all such eligible Participants.

(3)            To the extent the contribution is not exhausted after it has been allocated pursuant to clauses (1) and (2), the balance, if any, will be allocated to each Participant eligible to share in the contribution with respect to the Participating Business Unit in the same proportion that his or her Eligible Earnings for the Plan Year bears to the aggregate Eligible Earnings for the Plan Year of all such eligible Participants.

(d)            A Participating Employer's Profit Sharing Contribution for a Plan Year, if any, will be paid to the Trustee on such date or dates during or following such Plan Year as the Participating Employer may elect but in no case more than 12 months after the end of the Plan Year.

3.5.           Rollovers.

(a)              With the prior consent of the Administrator, an Active Participant may contribute to the Trust, in a direct rollover pursuant to Code section 401(a)(31) or within 60 days of receipt:

(i)              an amount paid or distributed out of an individual retirement account to which the only contributions have been one or more Eligible Rollover Distributions; or

(ii)            an Eligible Rollover Distribution from such a qualified plan.

(b)             Any contribution to the Trust pursuant to this section must be made in cash and will be added to the Participant's Rollover Account.

3.6.           Corrective Contributions.

(a)              For any Plan Year, a Participating Employer may, but is not required to, contribute to the Matching Contribution Accounts or Profit Sharing Contribution Accounts, or both, of Active Participants who are not Highly Compensated Employees, or any group of such Participants identified by the Administrator, such amounts as the Participating Employer deems advisable to assist the Plan in satisfying the requirements of Section 9.2, 9.3 or 9.4, or any other requirement under the Code or Treasury Regulations, for the Plan Year. (b)             Contributions pursuant to this section will be allocated in accordance with one or more of the following clauses, as determined by the Administrator.

(i)               Contributions are allocated among the Matching Contribution Accounts of the Participants eligible to share in the allocation who made 401(k) Contributions for the Plan Year in proportion to such 401(k) Contributions up to six percent of the Participant's Eligible Earnings for the Plan Year.

 (ii)             Contributions are allocated among the Profit Sharing Contribution Accounts of the Participants eligible to share in the allocation in proportion to their respective Eligible Earnings from the Participating Employer for the Plan Year.

(iii)          Contributions are allocated among the Matching Contribution Accounts of Participants eligible to share in the allocation who made 401(k) Contributions for the Plan Year or allocated among the Profit Sharing Contribution Accounts of the Participants eligible to share in the allocation for the Plan Year, or both, by starting with the eligible Participant with the lowest Eligible Earnings for the Plan Year and allocating to that Participant up to the maximum amount permitted by Section 9.6 and continuing successively with the eligible Participant(s) with the next lowest Eligible Earnings for the Plan Year until the amount to be allocated pursuant to this clause (ii) has been fully allocated.

(iv)          Contributions are allocated among the Matching Contribution Accounts of the Participants eligible to share in the allocation who made 401(k) Contributions for the Plan Year or allocated among the Profit Sharing Contribution Accounts of the Participants eligible to share in the allocation for the Plan Year, or both, on a per capita basis.

Contributions pursuant to this section which are used to satisfy the requirements of Section 9.2 will be added to a separate subaccount with respect to which gains, losses, withdrawals and other credits or charges are separately allocated on a reasonable and consistent basis pursuant to Section 4.2.

ARTICLE 4. Accounts and Valuation

4.1.          Establishment of Accounts.

(a)              For each Participant, the following Accounts will be established and maintained:

(i)              A 401(k) Contribution Account, to which there will be added any 401(k) Contributions made on the Participant's behalf;

(ii)            An After-Tax Contribution Account, which will include the balance of his or her supplemental contribution account and employee basic contribution account under prior provisions of the Plan and to which there will be added any After-Tax Contributions made by the Participant; (iii)          A Matching Contribution Account, which will include the balance of his or her employer contribution account under prior provisions of the Plan and to which there will be added any Matching Contributions made on the Participant's behalf;

(iv)          A Profit Sharing Contribution Account, which will include the balance of his or her profit sharing account under the BMC Industries, Inc. Profit Sharing Plan and to which there will be added any Profit Sharing Contributions made on the Participant's behalf;

(v)            A Rollover Account, to which there will be added any rollover contribution made by the Participant pursuant to Section 3.5; and

(vi)          A Profit Sharing Plan Rollover Account, which will consist solely of the balance of his or her rollover account under the BMC Industries, Inc. Profit Sharing Plan.

(b)            One or more additional accounts or subaccounts may be established and maintained for any Participant or group of similarly situated Participants in connection with the merger of another plan into the Plan, in which case provisions of the Plan applicable solely to such accounts will be set forth on an exhibit to the Plan in accordance with Section 14.1(f).

4.2.           Valuation and Account Adjustment.  At such intervals as specified in Plan Rules, but at least annually, each Participant's Accounts within each investment fund established pursuant to Section 5.1 will be adjusted, in a manner determined by the Administrator to be uniform and equitable with respect to the Accounts being adjusted at the time in question, for income, expense, gains and losses of the investment fund, as well as contributions, withdrawals, loans, loan repayments, loan offsets, distributions and other activity, since the last prior adjustment. 4.3.           Allocations Do Not Create Rights.  The fact that allocations are made and credited to the Accounts of a Participant does not vest in the Participant any right, title or interest in or to any portion of the Fund except at the time or times and upon the terms and conditions expressly set forth in the Plan.  Notwithstanding any allocation or addition to the Account of any Participant, the issuance of any statement to the Participant or a Beneficiary of a deceased Participant or the distribution of all or a portion of any Account balance, the Administrator may direct the Account to be adjusted to the extent necessary to correct any error in the Account, whether caused by misapplication of any provision of the Plan or otherwise, and may recover from the Participant or Beneficiary the amount of any excess distribution.

ARTICLE 5. Participant Investment Direction

5.1.          Establishment of Investment Funds.

(a)              In order to allow each Participant to determine the manner in which his or her Accounts will be invested, the Trustee will maintain, within the Trust, three or more separate investment funds of such nature and possessing such characteristics as the Committee may specify from time to time.  Each Participant's Accounts will be invested in the investment funds in the proportions directed by the Participant in accordance with the procedures set forth in Sections 5.2 and 5.3.  The Committee may, from time to time, direct the Trustee to establish additional investment funds or to terminate any existing investment fund.

(b)            In addition to the investment funds maintained pursuant to Subsection (a), the Trustee will maintain, within the Trust, the BMC Common Stock Fund, which will be invested in shares of Company Stock except for such amounts of cash as the Committee determines to be necessary to satisfy short-term liquidity requirements and cash held pending acquisition of shares of Company Stock.

(c)              Notwithstanding any other provision of the Plan to the contrary, the Committee may direct the Trustee to suspend Participant investment activity (including such activity in connection with the withdrawals, loans and distributions) in any or all investment funds, or impose special rules or restrictions of uniform application, for a period determined by the Committee to be necessary in connection with:

(i)              the establishment or termination of any investment fund;

(ii)            the receipt by the Trustee from, or transfer by the Trustee to, another trust of account balances in connection with an acquisition or divestiture or otherwise;

(iii)          a change of Trustee, investment manager or recordkeeper; or

(iv)          such other circumstances determined by the Committee as making such suspension or special rules or restrictions necessary or appropriate.

5.2.          Contribution Investment Directions.

(a)              In conjunction with his or her enrollment in the Plan, a Participant must direct the manner in which contributions to his or her Accounts will be invested among the investment funds maintained pursuant to Section 5.1.  Such a direction must be made in accordance with and is subject to Plan Rules.  To the extent a Participant fails to direct Account investments, the Accounts will be invested in the manner specified in Plan Rules.  

(b)             A Participant may direct a change in the manner in which future contributions credited to his or her Accounts will be invested among the investment funds maintained pursuant to Section 5.1.  Such a direction must be made in accordance with and is subject to Plan Rules and will become effective at the time and manner specified in Plan Rules and in accordance with rules and procedures of the investment fund after the Trustee receives a complete and accurate direction.

(c)              Plan Rules will include procedures pursuant to which Participants are provided with the opportunity to obtain written confirmation of investment directions made pursuant to this section.

5.3.          Transfer Among Investment Funds.

(a)              A Participant may direct the transfer of his or her Accounts among the investment funds maintained pursuant to Section 5.1.  Such a direction must be made in accordance with and is subject to Plan Rules and will become effective at the time and manner specified in Plan Rules and in accordance with rules and procedures of the investment fund after the Trustee receives a complete and accurate direction.  

(b)             Plan Rules will include procedures pursuant to which Participants are provided with the opportunity to obtain written confirmation of investment directions made pursuant to this section.

(c)              Plan Rules may limit and restrict transfers into and out of specific investment funds.

5.4.          BMC Common Stock Fund.

(a)             Subject to Subsection (b), all amounts credited to a Participant's Matching Contribution Account will be invested only in the BMC Common Stock Fund and no amounts credited to any of a Participant's other Accounts may be invested in the BMC Common Stock Fund.

(b)             Notwithstanding Subsection (a) -

(i)              Not more than once each calendar quarter, a Participant who has attained age 55 may elect to transfer all or any portion of his or her Matching Contribution Account from the BMC Common Stock Fund to one or more of the investment funds maintained pursuant to Section 5.1 other than the BMC Common Stock Fund.  The election must be made in accordance with and is subject to Plan Rules and will be effective as soon as administratively practicable after it is received by the Administrator or the Administrator's designate.  All Matching Contributions credited to the Participant's Matching Contribution Account after the effective date of the direction will continue to be invested pursuant to Subsection (a).

(ii)            Not more than once each calendar quarter, a Participant who is an Employee and is not eligible to make directions pursuant to Subsection (b)(i) may elect to transfer up to 25 percent of his or her Matching Contribution Account from the BMC Common Stock Fund to one or more of the investment funds maintained pursuant to Section 5.1 other than the BMC Common Stock Fund.  A Participant may only make an election pursuant to this Subsection (b)(ii) if the portion of the  Participant's Matching Contribution Account invested in the BMC Common Stock Fund equals or exceeds 20 percent of the aggregate balance of the Participant's 401(k) Contribution Account, Matching Contribution Account, After-Tax Contribution Account and Rollover Account.  The election must be made in accordance with and is subject to Plan Rules and will be effective as soon as administratively practicable after it is received by the Administrator or the Administrator's designate.  All Matching Contributions credited to the Participant's Matching Contribution Account after the effective date of such direction will continue to be invested pursuant to Subsection (a).

5.5.           Investment Direction Responsibility Resides With Participants.  The Plan is intended to constitute a plan described in ERISA section 404(c).  Accordingly, neither the Administrator, the Committee, the Trustee nor the Participating Employers have any authority, discretion, responsibility or liability with respect to a Participant's selection of the investment funds in which his or her Accounts will be invested, the entire authority, discretion and responsibility for, and any results attributable to, the selection being that of the Participant. 5.6.           Beneficiaries and Alternate Payees.  Solely for purposes of this article, the term "Participant" includes the Beneficiary of a deceased Participant and an alternate payee under a qualified domestic relations order within the meaning of Code section 414(p) unless otherwise provided in such order, but only after:

(a)              the Administrator has determined the identity of the Beneficiary and the amount of the Account balance to which he or she is entitled in the case of a Beneficiary of a deceased Participant; or (b)             the Administrator has, in accordance with Plan Rules, made a final determination that the order is a qualified domestic relations order and all rights to contest such determination in a court of competent jurisdiction within the time prescribed by Plan Rules have expired or been exhausted in the case of an alternate payee.

ARTICLE 6. Withdrawals During Employment and Loans

6.1.          Hardship Withdrawals from 401(k) Contribution Account.

(a)              Subject to the provisions of Section 6.5, a Participant who is an Employee may make a hardship withdrawal from his or her 401(k) Contribution Account in accordance with this section.  A hardship withdrawal will be permitted only if the Administrator determines that the withdrawal is made on account of an immediate and heavy financial need of the Participant and is necessary to satisfy such financial need.  (b)             A withdrawal will be deemed to be made on account of an immediate and heavy financial need only if it is determined by the Administrator to be on account of:

(i)              expenses for medical care, described in Code section 213(d), incurred or to be incurred by the Participant, the Participant's spouse or the Participant's dependent (as defined in Code section 152 that are not otherwise reimbursable);

(ii)            costs directly related to the purchase (excluding mortgage payments) of a principal residence of the Participant;

(iii)          payment of tuition, related educational fees and room and board expenses for the next 12 months of post-secondary education for the Participant or his or her spouse, child or other dependent (as defined in Code section 152);

(iv)          payments necessary to prevent the eviction of the Participant from his or her principal residence or foreclosure on the mortgage on the Participant's principal residence;

(v)            expenses incurred or to be incurred by the Participant that are directly related to the partial or total destruction of a principal residence of the Participant through an act of God that are not otherwise reimbursable;

(vi)          expenses incurred or to be incurred by the Participant that are directly related to and the principal purpose of which is the legal adoption of a child by the Participant that are not otherwise reimbursable; or

(vii)        loss of income due to layoff of the Participant or his or her spouse.

(c)              A withdrawal will be deemed to be necessary to satisfy the immediate and heavy financial need of the Participant only if the Administrator determines that each of the requirements in this subsection is satisfied.

(i)              The withdrawal is not more than the sum of the amount of the immediate and heavy financial need of the Participant plus an amount to pay any federal, state or local taxes or penalties that the Participant will incur in connection with the withdrawal or to satisfy withholding obligations in connection with that withdrawal, in either case as determined by the Administrator in accordance with Plan Rules.

(ii)            The Participant has received all withdrawals and has taken all nontaxable loans available under the Plan and all other qualified plans maintained by any Affiliated Organization.

(iii)          All 401(k) Contributions and After-Tax Contributions and all elective deferrals and after-tax employee contributions by or on behalf of the Participant under any other qualified or nonqualified plan of deferred compensation maintained by any Affiliated Organization are suspended for a period of 12 months following the date of the withdrawal. (iv)          For the Participant's taxable year following the taxable year during which he or she received the withdrawal, the amount of elective deferrals under all qualified plans maintained by any Affiliated Organization (including 401(k) Contributions pursuant to the Plan) that may be made on the Participant's behalf under Code section 402(g) is reduced by the amount of such elective deferrals made on the Participant's behalf for the taxable year during which he or she received the withdrawal.

(d)             The Administrator's determination of the existence of a Participant's financial hardship and the amount that may be withdrawn to satisfy the need created by such hardship will be made in accordance with Treasury Regulations, and is final and binding on the Participant. The Administrator may require the Participant to make representations and certifications concerning his or her entitlement to a withdrawal pursuant to this section and is entitled to rely on such representations and certifications unless the Administrator has actual knowledge to the contrary.  The Administrator is not obligated to supervise or otherwise verify that amounts withdrawn are applied in the manner specified in the Participant's withdrawal application. (e)              The amount of any withdrawal pursuant to this section may not exceed the amount of 401(k) Contributions made by the Participant.

6.2.           Withdrawals from 401(k) Contribution Account After Attaining Age 591/2 .  Subject to the provisions of Section 6.5, a Participant who (a) is an Employee, (b) has attained age 591/2 and (c) has received all withdrawals available pursuant to Sections 6.3 and 6.4, may withdraw all or any part of the balance of his or her 401(k) Contribution Account. 6.3.           Withdrawals from After-Tax Contribution Account.

(a)              Subject to Section 6.5, a Participant who is an Employee may withdraw all or any part of the balance of his or her After-Tax Contribution Account. (b)             All After-Tax Contributions and all Fund earnings or losses with respect thereto will be treated as a separate contract under the Plan and such contributions and earnings or losses will be separately accounted for in accordance with the Code.  Insofar as the Plan permitted Participants to make in-service withdrawals from their After-Tax Accounts on May 5, 1986, all withdrawals pursuant to this Section will be deemed to be made first from the Participant's investment in the contract as of December 31, 1986 (reduced by withdrawal distributions made from the After-Tax Contribution Account after December 31, 1986 and prior to the distribution in question that were not included in the Participant's gross income). 

6.4.           Withdrawals from Rollover Account.  Subject to the provisions of Section 6.5, a Participant who (a) is an Employee and (b) has received all withdrawals available pursuant to Section 6.3, may withdraw all or any part of the balance of his or her Rollover Account.

6.5.           Rules for Withdrawals.

(a)              Applications for withdrawals must be made in accordance with and are subject to Plan Rules.

(b)             A withdrawal will be made as soon as administratively practicable after the Administrator's determination that the Participant is entitled to receive the withdrawal distribution.

(c)              A withdrawal will be made on a pro rata basis from the investment fund or funds in which the Account from which the distribution is made is invested.

(d)             All withdrawals will be made in the form of a single sum payment made by a check drawn on the Trust.

(e)             A Participant may not withdraw the portion of his or her Accounts consisting of a note evidencing the unpaid balance of any loan made pursuant to the Plan.

(f)               The provisions of Section 8.7(a) apply to any withdrawal that constitutes an Eligible Rollover Distribution.

6.6.           No Other In-Service Withdrawals.  Except as otherwise expressly provided in the Plan, a Participant may not make withdrawals from his or her Matching Contribution Account, Profit Sharing Contribution Account or Profit Sharing Plan Rollover Account prior to his or her Termination of Employment.

6.7.           Plan Loans.

(a)              Each Participant or Beneficiary of a deceased Participant who (i) is an Employee or is otherwise a "party in interest" within the meaning of ERISA, and (ii) has received all withdrawals available pursuant to Section 6.3, may borrow funds from the vested balance of his or her 401(k) Contribution, Matching Contribution Account and Rollover Account, by submitting to the Administrator a complete and accurate loan application, in accordance with and subject to Plan Rules, subject to the succeeding provisions of this section.

(i)              The amount of the loan may not cause the aggregate amount of outstanding loans to the borrower from the Plan to exceed the least of:

(1)            $50,000, reduced by the excess (if any) of (A) the highest outstanding balance of all loans to the borrower from the Plan and all other qualified plans maintained by any Affiliated Organization during the 12-month period ending on the day before the date of the loan over (B) the outstanding balance of such loans on the date of the loan; and

(2)            50 percent of the aggregate vested balance of the borrower's 401(k) Contribution Account, Matching Contribution Account and Rollover Account as of the date on which the loan is made.

(ii)            The maturity date for any loan may not exceed five years from the date of the note, unless the Administrator determines at the time the loan is made that the proceeds of the loan will be used to purchase a house, townhome, apartment, condominium or mobile home used, or intended to be used within a reasonable time after the loan is made, as the borrower's principal residence, in which case the maturity date may not exceed ten years from the date of the note. 

(iii)          No loan will be made from the portion of a borrower's Matching Contribution Account invested in the BMC Common Stock Fund.  If a Participant's Matching Contribution Account is not fully vested, the portion of the Account that is not invested in the BMC Common Stock Fund will be allocated ratably among the vested and nonvested portions of the Account.

(iv)          Loans will be charged against the vested portion of a borrower's Accounts in the following order:  Rollover Account; 401(k) Contribution Account; and Matching Contribution Account.  No loan will be charged against any Account until the funds available to be borrowed in any prior Account have been exhausted.  A loan application fee, if any, charged by the Trustee or another third party will be charged against the Participant's Accounts in the same order.

(v)            The loan proceeds and any loan application fee will be obtained from the investment fund or funds in which the borrower's Accounts are then invested on a pro rata basis, except that no proceeds will be obtained from the portion of a borrower's Matching Contribution Account invested in the BMC Common Stock Fund.

(vi)          The promissory note evidencing a loan must provide for payments of principal and interest in equal installments of such frequency, not less frequently than quarterly, in such minimum amounts and for such maximum period as Plan Rules prescribe.

(b)             Each loan will be a loan by the Trust, but for Trust accounting purposes the loan will be deemed made from the borrower's Accounts against which the loan is charged, and the note executed by the borrower will be deemed to be an asset of those Accounts.  When a loan is made, the borrower's Accounts and any investment fund from which the loan proceeds are obtained will be reduced by an amount equal to the principal balance of the loan and a loan account will be established for the borrower with an initial balance equal to the principal amount of the loan.  The loan account will be excluded for purposes of determining and allocating the net earnings (or losses) of the Trust pursuant to Section 4.2.  A borrower's loan payments will be credited to the Accounts from which the loan proceeds were obtained on a pro rata basis.  The loan account will be reduced by the amount of any principal payment on the loan.  Repayments of loan principal and payments of interest will be invested as soon as administratively practicable following receipt by the Trustee in accordance with the borrower's most recent investment directions with respect to new contributions or in the absence of such a direction, in accordance with Plan Rules. (c)              Plan Rules may specify other terms and conditions as may be necessary or desirable for the administration of loans under this section.

ARTICLE 7. Vesting and Forfeitures

7.1.          Vesting.

(a)              A Participant always has a fully vested nonforfeitable interest in his or her 401(k) Contribution Account, After-Tax Contribution Account, Rollover Account, and Profit Sharing Plan Rollover Account, in the portion of his or her Matching Contribution Account attributable to his or her employer contribution account under prior provisions of the Plan and in the portion of his or her Matching Contribution Account or Profit Sharing Contribution Account credited to a subaccount described in Section 3.6.

(b)             A Participant will acquire a fully vested nonforfeitable interest in the portion of his or her Matching Contribution Account and Profit Sharing Contribution Account not described in Subsection (a) upon attaining his or her Normal Retirement Date while he or she is, or before he or she became, an Employee.

(c)              A Participant will acquire a fully vested nonforfeitable interest in the portion of his or her Matching Contribution Account and Profit Sharing Contribution Account not described in Subsection (a) if he or she dies or becomes Disabled while he or she is an Employee.

(d)            A Participant will acquire a fully vested nonforfeitable interest in the portion of his or her Profit Sharing Account not described in Subsection (a) upon the Participant's Termination of Employment following the Participant's attainment of age 60 if the sum of his or her age and full years of Vesting Service is at least 65.

(e)             A Participant will acquire a fully vested nonforfeitable interest in the portions of his or her Matching Contribution Account and Profit Sharing Contribution Account not described in Subsection (a) if the Affiliated Organization, Participating Business Unit, business unit, location or division at which the Participant is employed, permanently ceases operations or is sold or otherwise transferred through sale of stock or of business and assets, in such manner that it no longer is, or is no longer owned by, an Affiliated Organization.

(f)              A Participant will acquire a fully vested nonforfeitable interest in the portions of his or her Matching Contribution Account and Profit Sharing Contribution Account not described in Subsection (a) upon a Change in Control with respect to the Company, which for purposes of this subsection means any of the following:

(i)              The sale, lease, exchange, or other transfer of all or substantially all of the assets of the Company, in one transaction or in a series of related transactions, to any Person;

(ii)            The approval by the stock holders of the Company of any plan or proposal for the liquidation or dissolution of the Company;

(iii)          Any Person is or becomes the "beneficial owner" (as defined in Rule 13d-3 under the Securities and Exchange Act of 1934, as amended (the "Exchange Act")), directly or indirectly, of 50 percent or more of the combined voting power of the Company's outstanding securities ordinarily having the right to vote at elections of directors;

(iv)          Individuals who constitute the Company's Board of Directors on January 1, 1998 (the "Incumbent Board") cease for any reason to constitute at least a majority thereof, provided that any person becoming a director subsequent to January 1, 1998 whose election, or nomination for election, by the Company's stockholders, was approved by a vote of at least a majority of the directors comprising the Incumbent Board (either by a specific vote or by approval of the proxy statement of the Company in which such person is named as a nominee for director, without objection to such nomination) will, for purposes of this clause (iv), be deemed to be a member of the Incumbent Board; or

(v)            A change in control of a nature that is determined by independent legal counsel to the Company to be required to be reported (assuming such event has not been "previously reported") in response to Item 1(a) of the Current Report on Form 8-K, as in effect on January 1, 1994, pursuant to section 13 or 15(d) of the Exchange Act, whether or not the Company is then subject to such reporting requirement.

For purpose of applying the foregoing, the term "Person" means and includes any individual, corporation, partnership, group, association or other "person," as such term is used in section 14(d) of the Exchange Act, other than the Company, a wholly-owned subsidiary of the Company or any employee benefit plan(s) sponsored by the Company or a wholly-owned subsidiary of the Company.

(g)              A Participant whose Matching Contribution Account is not otherwise fully vested will acquire a vested nonforfeitable interest in the portion of his or her Matching Contribution Account not described in Subsection (a) to the extent provided in the following schedule:

Full Years of Vesting Service Less Than One Year
One Year        
Two Years     
Three Years   
Four or More Years Vested
Interest

  0  %
 25%
 50%
 75%
100%

(h)             A Participant whose Profit Sharing Contribution Account is not otherwise fully vested will acquire a vested nonforfeitable interest in the portion of his or her Profit Sharing Contribution Account not described in Subsection (a) to the extent provided in the following schedule:

Full Years of Vesting Service Less than Five Years
Five or More Years Vested
Interest

  0  %
100%

 

7.2.           Forfeiture Upon Distribution.

(a)              If a Participant receives a distribution of the entire vested balance of his or her Accounts after Termination of Employment and before he or she incurs five consecutive One-Year Breaks in Service, the nonvested portions of the Participant's Matching Contribution Account and Profit Sharing Contribution Account will, at the time of such distribution, be forfeited.  A Participant who has no vested interest in his or her Matching Contribution Account and Profit Sharing Contribution Account when he or she terminates employment will be deemed to have received a distribution of the entire vested balance of the Accounts at the time of his or her Termination of Employment.

(b)             If a Participant described in Subsection (a) received a distribution of less than the entire balance of his or her Accounts, resumes employment as a Qualified Employee and repays to the Trustee the full amount distributed, other than the portion of the distribution attributable to his or her After-Tax Contribution Account, Rollover Account and Profit Sharing Plan Rollover Account balances, before the earlier of (1) five years following the date of reemployment as a Qualified Employee or (2) the date on which he or she incurs five consecutive One-Year Breaks in Service following the distribution, then, the amount of any forfeitures will be restored to the Participant's Matching Contribution Account and Profit Sharing Contribution Account, unadjusted for interest or any change in value occurring after the distribution.  Such restoration will be made from forfeitures that arise for the Plan Year for which such restoration is to be made.  To the extent such forfeitures are insufficient for such purpose, the Participating Employer with whom the Participant was last employed as a Qualified Employee will contribute the amount required to restore the Accounts.  A Participant described in the last sentence of Subsection (a) who is reemployed before incurring five consecutive One-Year Breaks in Service following the date of his or her Termination of Employment will be deemed to have repaid his or her deemed distribution upon his or her reemployment as a Qualified Employee.

7.3.           Other Forfeitures.

(a)              Except as provided in Section 7.2, the nonvested portions of a Participant's Matching Contribution Account and Profit Sharing Contribution Account will continue to be held in separate subaccounts of such Accounts until the Participant incurs five consecutive One-Year Breaks in Service, at which time the subaccount balances will be forfeited.  If the Participant resumes employment with an Affiliated Organization prior to incurring five consecutive One-Year Breaks in Service, such subaccounts will be disregarded and their balances will be included in the Matching Contribution Account and Profit Sharing Contribution Account.

(b)             A Participant's vested interest in his or her Matching Contribution Account and Profit Sharing Contribution Account balances following a resumption of employment in accordance with Subsection (a) at any given time will not be less than the amount "X" determined by the formula: X = P(AB + (R x D)) - (R x D), where P is the Participant's vested percentage at the time of determination; AB is the Account balance at the time of determination; D is the amount of the distribution; and R is the ratio of the Account balance at the time of determination, to the subaccount balance immediately following the distribution.

7.4.           Application of Forfeitures.  All forfeitures occurring in a Plan Year will be allocated to an account, invested in accordance with Plan Rules and applied as follows:

(a)              Such forfeitures will first be applied to restore the Accounts of Participants as provided in Sections 7.2(b) and 8.6; and

(b)             Any remaining forfeitures will be applied toward the amount of future contributions by the Participating Employers for the Plan Year in which the forfeiture occurs.

ARTICLE 8. Distributions After Termination

8.1.          Form and Time of Distribution.

(a)              Following a Participant's Termination of Employment, the Trustee will distribute to the Participant or, if the Participant has died, to his or her Beneficiary, the value of the Participant's vested interest in his or her Accounts.  Subject to the remaining subsections of this section and Section 8.7, distributions will be made in accordance with the following provisions.

(i)              If the aggregate balance of the Participant's vested interest in his or her Accounts is not more than $5,000, distribution to the Participant, or to the Participant's Beneficiary in the case of the Participant's death, will be made, in the form of a lump sum payment, as soon as administratively practicable following the Participant's Termination of Employment. 

(ii)            Except as provided in clause (i), distribution to the Participant will be made in the form of a lump sum payment.  The distribution will be made as soon as administratively practicable after the Administrator receives the Participant's properly completed distribution request, but in no case later than the sixtieth day after the Plan Year during which the Participant terminates employment or attains age 65, whichever is later, unless the Participant elects to defer the distribution pursuant to Subsection (b). 

(iii)          Notwithstanding any other provision of the Plan to the contrary, any Participant who is entitled to receive a distribution of his or her Accounts with an annuity starting date that is before March 1, 2002 may elect to receive the distribution in any optional form of benefit available under the Plan as of the date immediately preceding December 1, 2001.  For purposes of this clause, the term "annuity starting date" means:  (1) for an annuity, the first day of the first period for which an amount is payable as an annuity; or (2) for a distribution option other than an annuity, the first day on which all events have occurred which entitle the participant to the benefit.

(iv)          Except as provided in clause (i), distribution to the Participant's Beneficiary following the Participant's death will be made at the time elected by the Beneficiary in accordance with Subsection (c). 

(v)            All distributions will be made in the form of a check drawn on the Trust and, if applicable, a canceled note evidencing any Plan loan; provided, that if the vested portion of the Matching Contribution Account balance of a Participant or Beneficiary of a deceased Participant is credited with the equivalent of at least 10 full shares of Company Stock, at the election of the Participant or Beneficiary, distribution of the vested portion of the Matching Contribution Account balance invested in the BMC Common Stock Fund may be distributed in full shares of Company Stock and cash in lieu of any fractional share.

(vi)          If a contribution is allocated to a Participant's Account following the Participant's Termination of Employment and after his or her vested Account balance has been distributed, as soon as administratively practicable after the allocation is made, the vested balance of the Account will be distributed to the Participant, or to the Participant's Beneficiary in the case of the Participant's death, in the form of a lump sum payment.

(b)             Subject to the provisions of the other subsections of this Section 8.1, a Participant described in Subsection (a)(ii) may elect to defer commencement of his or her distribution under the Plan by providing the Administrator with a written, signed statement specifying the date on which the payment is to be made; provided that the specified date may not be later than April 1 of the calendar year following the calendar year during which the Participant attains age 701/2.  The statement must be provided to the Administrator not later than the thirtieth day (or such later date as Plan Rules may allow) after the Plan Year during which the Participant terminates employment or attains age 65, whichever is later.  Plan Rules may permit a Participant to modify the election in any manner determined by the Administrator to be consistent with Code section 401(a)(14) and the other provisions of this section.

(c)             Subject to Subsection (a)(i), if a Participant dies before receiving the full amount to which he or she is entitled, the amount remaining will be distributed to the Participant's Beneficiary in a lump sum payment no later than December 31 of the calendar year which contains the fifth anniversary of the date of the Participant's death, at such time or times as the Beneficiary elects on a form provided by the Administrator.

If the Participant's spouse is the Beneficiary and dies after the Participant's death but before distributions to the spouse have commenced, the foregoing rules will be applied as if the surviving spouse were the Participant, including the substitution of the surviving spouse's date of death for the Participant's date of death.

(d)            Notwithstanding Subsection (a), distribution to any Participant who attains age 70-1/2 before January 1, 1999, and distribution to any Participant who is a "5-percent owner," within the meaning of the Code section 416, must begin not later than April 1 of the calendar year after the Participant attains age 70-1/2, whether or not the Participant has terminated employment, as if he or she had terminated employment on the last day of the Plan Year during which he or she attained age 70-1/2.  A Participant who attained age 70-1/2 before January 1, 1999, is not a 5-percent owner and is an Employee on September 1, 1998 may elect to stop distributions or to defer commencement of distributions, as the case may be.  The election must be made in accordance with and is subject to Plan Rules, must be received by the Administrator not later than a date specified in Plan Rules, and will become effective as soon as administratively practicable after it is received by the Administrator.  The election is irrevocable after it is received by the Administrator.  If distributions to a Participant are stopped pursuant to this subsection, the Participant will have a new annuity starting date and his or her benefit will recommence in accordance with the other subsections of this Section 8.1 following his or her subsequent termination of employment.

(e)              Notwithstanding any other provision of the Plan to the contrary, distributions will be made in accordance with regulations issued under Code section 401(a)(9), including Treasury Regulation section 1.401(a)(9)-2, and any provisions of the Plan reflecting Code section 401(a)(9) take precedence over any distribution options in the Plan that are inconsistent with Code section 401(a)(9).

(f)              With respect to distributions under the Plan made in calendar years beginning on and after January 1, 2002, the Plan will apply the minimum distribution requirements of Code section 401(a)(9) in accordance with the regulations under Code section 401(a)(9) that were proposed in January 2001, notwithstanding any provision of the Plan to the contrary. 

8.2.           Beneficiary Designation.

(a)              Each Participant may designate, on a form provided by the Administrator, one or more primary Beneficiaries or alternative Beneficiaries for all or a specified fractional part of his or her aggregate Accounts and may change or revoke any such designation from time to time.  No such designation, change or revocation is effective unless executed by the Participant and received by the Administrator during the Participant's lifetime.  Subject to Subsection (d), no such change or revocation requires the consent of any person.

(b)             If a Participant

(i)              fails to designate a Beneficiary, or

(ii)            revokes a Beneficiary designation without naming another Beneficiary, or

(iii)          designates one or more Beneficiaries none of whom survives the Participant,

for all or any portion of the Accounts, such Accounts or portion are payable to the first class of the following classes of automatic Beneficiaries that includes a member surviving the Participant:

Participant's spouse;
Participant's issue, per stirpes and not per capita;
Representative of Participant's estate.

(c)              When used in this section and, unless the designation otherwise specifies, when used in a Beneficiary designation, the term "per stirpes" means in equal shares among living children and the issue (taken collectively) of each deceased child, with such issue taking by right of representation; "children" means issue of the first generation; and "issue" means all persons who are descended from the person referred to, either by legitimate birth or legal adoption.  The automatic Beneficiaries specified above and, unless the designation otherwise specifies, the Beneficiaries designated by the Participant, become fixed as of the Participant's death so that, if a Beneficiary survives the Participant but dies before the receipt of all payments due such Beneficiary, any remaining payments are payable to the representative of such Beneficiary's estate.  Any designation of a Beneficiary by name that is accompanied by a description of relationship or only by statement of relationship to the Participant is effective only to designate the person or persons standing in such relationship to the Participant at the Participant's death.

(d)             Notwithstanding Subsection (a), no designation of a Beneficiary other than the Participant's spouse is effective unless such spouse consents to the designation.  Any such consent is effective only with respect to the Beneficiary or class of Beneficiaries so designated and only with respect to the spouse who so consented.

8.3.           Assignment, Alienation of Benefits.

(a)              Except as required under a qualified domestic relations order or by the terms of any loan from the Trust or to comply with a federal tax levy pursuant to Code section 6331, and except as otherwise provided in Code section 401(a)(13)(C),

                (i) no benefit under the Plan may in any manner be anticipated, alienated, sold, transferred, assigned, pledged, encumbered or charged, and any attempt to do so is void and

                (ii) no benefit under the Plan is in any manner liable for or subject to the debts, contracts, liabilities, engagements or torts of the person entitled to such benefit.

(b)             To the extent provided in a qualified domestic relations order, distribution of benefits assigned to an alternate payee by such order may be distributed to the alternate payee in the form of a lump sum payment prior to the Participant's earliest retirement age.  The terms "qualified domestic relations order," "alternate payee" and "earliest retirement age" have the meanings given in Code section 414(p).

8.4.           Payment in Event of Incapacity.  If any person entitled to receive any payment under the Plan is physically, mentally or legally incapable of receiving or acknowledging receipt of the payment, and no legal representative has been appointed for such person, the Administrator in its discretion may (but is not required to) cause any sum otherwise payable to such person to be paidto any one or more of the following as may be chosen by the Administrator: the Beneficiaries, if any, designated by such person; the institution maintaining such person; a custodian for such person under the Uniform Transfers to Minors Act of any state; or such person's spouse, children, parents or other relatives by blood or marriage.  Any such payment completely discharges all liabilityunder the Plan to the person with respect to whom the payment is made to the extent of the payment.

8.5.           Payment Satisfies Claims.  Any payment to or for the benefit of any Participant, or Beneficiary in accordance with the provisions of the Plan, to the extent of such payment, fully satisfies of all claims against the Trustee, the Administrator and the Participating Employers, any of whom may require the payee to execute a receipted release as a condition precedent to such payment.

8.6.           Disposition if Distributee Cannot be Located.  If the Administrator is unable to locate a Participant or Beneficiary to whom a distribution is due, the amount that would otherwise be distributed to the Participant or Beneficiary will be forfeited, and the forfeited amount will be applied in accordance with Section 7.4.  The forfeited amount will be restored to the Accounts from which the amount was forfeited, unadjusted for interest or any change in value occurring after the forfeiture, upon the Participant's or Beneficiary's claim for the benefit.  The restoration will be made through funds available pursuant to Section 7.4(a).  To the extent such funds are insufficient for such purpose, the Participating Employer with whom the Participant was last employed will contribute the amount required to restore the Accounts.

8.7.           Direct Rollovers and Transfers.

(a)              To the extent a distribution is an Eligible Rollover Distribution, the Administrator will, if so instructed by the distributee in accordance with Plan Rules, direct the Trustee to make the distribution to an "eligible retirement plan," within the meaning of Code section 402(c)(8).  Unless otherwise provided in Plan Rules, the foregoing provision will not apply (i) if the aggregate taxable distributions to be made to the distributee during the calendar year are less than $200, (ii) if less than the entire taxable amount of the distribution is to be distributed to the eligible retirement plan and the amount to be distributed to the eligible retirement plan is less than $500 or (iii) with respect to any portion of an Eligible Rollover Distribution that consists of an offset amount with respect to a Plan loan.

(b)             The Administrator may direct the Trustee to transfer the balance of any or all of the Accounts of a Participant to the trustee of another plan if:

(i)              the other plan is a defined contribution plan qualified under Code section 401(a);

(ii)            the other plan satisfies the requirements set forth in Code sections 401(k) and 411(d)(6) with respect to the transferred Accounts to which such requirements are applicable; and

(iii)          the trustee of the other plan is willing to accept such transfer.

ARTICLE 9. Contribution Limitations

9.1.           401(k) Contribution Dollar Limitation.

(a)              The aggregate amount of 401(k) Contributions and other "elective deferrals" (within the meaning of Code section 402(g)(3)) under any other qualified plan maintained by an Affiliated Organization with respect to a Participant for any taxable year of the Participant may not exceed the limitation in effect for the taxable year under Code section 402(g).  The limitation for any Participant who received a hardship distribution under Section 6.1 will, for the year following the year in which such distribution was made, be reduced as provided in Section 6.1(c)(iv).  If the limitation is exceeded for any taxable year of the Participant, the portion of the excess specified by the Company, increased by Fund earnings or decreased by Fund losses attributable to the excess as determined under Section 9.5, will be distributed to the Participant. 

(b)             The amount distributed pursuant to this section to a Participant who has made elective deferrals for the taxable year other than pursuant to the Plan or another qualified plan maintained by an Affiliated Organization will, to the extent of such other elective deferrals, be determined in accordance with written allocation instructions received by the Administrator from the Participant not later than March 1 of the following the taxable year.

(c)             A distribution pursuant to this section may be made at any time after the excess contributions are received, but not later than April 15 of the taxable year following the taxable year to which the limitation relates. 

9.2.           Actual Deferral Percentage Limitations.

(a)              For each Plan Year, the Plan must satisfy the requirements of Code section 401(k)(3). 

(i)              The Plan will satisfy the requirements of Code section 401(k)(3) for a Plan Year if, for that Plan Year, the Plan satisfies the requirements of Code section 410(b)(1) with respect to "eligible employees" and either of the following tests:

(1)            the "actual deferral percentage" for the Plan Year for eligible employees who are Highly Compensated Employees for the Plan Year is not more than the product of the actual deferral percentage for the precedingPlan Year for all eligible employees who are not Highly Compensated Employees for the preceding Plan Year, multiplied by one and one-quarter; or

 (2)            the excess of the actual deferral percentage for the Plan Year for eligible employees who are Highly Compensated Employees for the Plan Year over the actual deferral percentage for the preceding Plan Year for all eligible employees who are not Highly Compensated Employees for the preceding Plan Year is not more than two percentage points and the actual deferral percentage for the Plan Year for eligible employees who are Highly Compensated Employees for the Plan Year is not more than the product of the actual deferral percentage for the preceding Plan Year of all eligible employees who are not Highly Compensated Employees for the preceding Plan Year, multiplied by two;  provided, that for the initial Plan Year, the actual deferral percentage for eligible employees who are not Highly Compensated Employees is their actual deferral percentage for the initial Plan Year.

(ii)            For purposes of this section and Section 9.4:

(1)            "eligible employee" means an Active Participant who is eligible to make 401(k) Contributions for the Plan Year in question or would be eligible but for a suspension imposed under Section 3.1(b)(iv); and

(2)            "actual deferral percentage," with respect to either of the two groups of eligible employees referenced above, is the average of the ratios, calculated separately for each eligible employee in the particular group, of the amount of 401(k) Contributions made by the eligible employee for the Plan Year in question, to the eligible employee's Testing Wages for the Plan Year in question, or the portion of such Plan Year during which he or she was an eligible employee, as specified in Plan Rules.  In computing the actual deferral percentage, the following rules apply:

(A)           Any 401(k) Contributions made by an eligible employee who is not a Highly Compensated Employee that are in excess of the limitation described in Section 9.1 will be excluded;

(B)           Any 401(k) Contributions made by an eligible employee that are distributed to the eligible employee pursuant to Section 9.6(c) will be excluded;

(C)           Except as otherwise provided in Treasury Regulations, 401(k) Contributions taken into account in determining the actual contribution percentage under Section 9.3(a)(ii) will be excluded;

(D)           To the extent permitted by Treasury Regulations and determined by the Administrator, all or any portion of any other contribution to the Plan or any other qualified plan maintained by an Affiliated Organization will be included;

(E)            Elective contributions under any other plan that is aggregated with this Plan to satisfy the requirements of Code section 410(b) will be included; and

(F)            To the extent provided in Treasury Regulations, elective contributions made under any other qualified cash or deferred arrangement of any Affiliated Organization on behalf of any eligible Employee who is a Highly Compensated Employee will be included.

(b)             To the extent deemed advisable by the Administrator to comply with Code section 401(k)(3), the Administrator may, in accordance with Plan Rules, prospectively decrease a Participant's 401(k) Contributions. 

(c)             If, for any Plan Year, the requirements of Subsection (a) are not satisfied, the Administrator will determine the amount by which 401(k) Contributions made by each Highly Compensated Employee for the Plan Year exceeds the permissible amount as determined under Subsection (a).  The determination will be made by successively decreasing the rate of 401(k) Contributions by the Highly Compensated Employees who, during the Plan Year, had the greatest percentage of 401(k) Contributions to the next lower percentage, then again decreasing the percentage of such Highly Compensated Employees' 401(k) Contributions, together with the percentage of 401(k) Contributions by such Highly Compensated Employees who were already at such lower percentage, to the next lower percentage, and continuing such procedure for as many percentage decreases as the Administrator deems necessary.  The Administrator may make such reductions in any amount.

(d)             The amount of excess 401(k) Contributions determined in accordance with Subsection (c), increased by Fund earnings or decreased by Fund losses attributable to such excess as determined under Section 9.5, will be distributed to affected Highly Compensated Employees, at such time as the Administrator specifies on or following the last day of the Plan Year for which the determination is made, but in no case later than the last day of the following Plan Year.  The amount to be distributed with respect to any Plan Year will be reduced by the portion of the amount, if any, distributed pursuant to Section 9.1 that is attributable to 401(k) Contributions that relate to such Plan Year, determined by assuming that 401(k) Contributions in excess of the limitation described in Section 9.1 for a given taxable year are the first contributions made for a Plan Year falling within such taxable year.  Additional amounts to be distributed to Highly Compensated Employees will be determined by successively decreasing the amount of 401(k) Contributions for Highly Compensated Employees who, for the Plan Year, had the largest amount of 401(k) Contributions made on their behalf to the next lower amount, and continuing this procedure until an amount equal to the aggregate amount of excess 401(k) Contributions has been removed from the Accounts of the Highly Compensated Employees.

(e)              To the extent required or permitted by Treasury Regulations, the Administrator will or may, as the case may be, apply the limitation described in this section separately to each group of eligible employees who are included in a unit of Employees covered by a collective bargaining agreement.

(f)               If the Administrator elects to apply Code section 410(b)(4)(B) in determining whether the Plan satisfies either of the tests described in Section 9.2(a)(i) for a Plan Year, all eligible employees who have not met either the minimum age and/or minimum service requirements of Code section 410(a)(1)(A) will be considered separately in accordance with the tests described in Section 9.2(a)(i).

9.3.           Actual Contribution Percentage Limitations.

(a)              For each Plan Year, the Plan must satisfy the requirements of Code section 401(m)(2).

(i)              The Plan will satisfy the requirements of Code section 401(m)(2) for a Plan Year if, for that Plan Year, the Plan satisfies either of the following tests:

(1)            the "actual contribution percentage" for the Plan Year for "eligible employees" who are Highly Compensated Employees for the Plan Year is not more than the product of the actual contribution percentage for the preceding Plan Year for all eligible employees who are not Highly Compensated Employees for the preceding Plan Year, multiplied by one and one-quarter; or

(2)            the excess of the actual contribution percentage for the Plan Year for eligible employees who are  Highly Compensated Employees for the Plan Year over the actual contribution percentage for the preceding Plan Year for all eligible employees who are not Highly Compensated Employees for the preceding Plan Year is not more than two percentage points and the actual contribution percentage for the Plan Year for Highly Compensated Employees for the Plan Year is not more than the product of the actual contribution percentage for the preceding Plan Year for all eligible employees who are not Highly Compensated Employees for the preceding Plan Year, multiplied by two; provided, that for the initial Plan Year, the actual contribution percentage for eligible employees who are not Highly Compensated Employees is their actual contribution percentage for the initial Plan Year.

(ii)            For purposes of this section and Section 9.4:

(1)            "eligible employee" means an Active Participant who is eligible to make After-Tax Contributions, or to have Matching Contributions made on his or her behalf for the Plan Year in question or who would be eligible but for a suspension imposed under Section 3.1(b)(iv) or Section 3.2(b)(iv); and

(2)            the "actual contribution percentage" with respect to either of the two groups of eligible employees referenced above, is the average of the ratios, calculated separately for each eligible employee in the particular group, of the aggregate amount of After-Tax Contributions made by, andMatching Contributions made on behalf of, the eligible employee for the Plan Year, to the eligible employee's Testing Wages for the Plan Year, or the portion of the Plan Year during which he or she was an eligible employee, as specified in Plan Rules.  In computing the actual contribution percentage the following rules apply:

(A)           Except as otherwise provided in Treasury Regulations, Matching Contributions taken into account in determining the actual deferral percentage under Section 9.2(a)(ii) will be excluded; 

(B)           Matching Contributions taken into account for purposes of the minimum contribution required by Section 13.3(a) will be excluded;

(C)           Any Matching Contributions forfeited pursuant to Section 9.6(c) will be excluded;

(D)           To the extent permitted by Treasury Regulations and determined by the Administrator, all or any portion of the 401(k) Contributions made by eligible employees for the Plan Year will be included;

(E)            To the extent permitted by Treasury Regulations and determined by the Administrator, all or any portion of any other contributions to any other qualified plan maintained by an Affiliated Organization will be included;

(F)            Matching contributions (within the meaning of Code section 401(m)(4)(A)) and after-tax contributions made under any other plan that is aggregated with this Plan to satisfy the requirements of Code section 410(b) will be included; and

(G)           To the extent required by Treasury Regulations, matching contributions (within the meaning of Code section 401(m)(4)(A)) and after-tax contributions made under any other qualified plan of any Affiliated Organization on behalf of or by any eligible employee who is a Highly Compensated Employee will be included.

(b)             If, for any Plan Year, the requirements of Subsection (a) are not satisfied, the Administrator will determine the amount by which After-Tax Contributions made by each Highly Compensated Employee for the Plan Year and, if necessary, Matching Contributions made on behalf of each Highly Compensated Employee for the Plan Year exceeds the permissible amount as determined under Subsection (a), such determination being made in accordance with the procedure described in Section 9.2(c) with respect to reductions of 401(k) Contributions. 

(c)              The amount of excess After-Tax Contributions and Matching Contributions determined in accordance with Subsection (b), increased by Fund earnings or decreased by Fund losses attributable to such excess as determined under Section 9.5, will be distributed to affected Highly Compensated Employees at such time as the Administrator specifies on or following the last day of the Plan Year for which the determination is made, but in no case later than the last day of the following Plan Year; provided, however, that to the extent the excess Matching Contributions would not be fully vested if retained in the Plan, such excess will be forfeited rather than distributed, and any such forfeitures will be applied as provided in Section 3.3(d).  Amounts to be distributed to Highly Compensated Employees or forfeited will be determined by successively decreasing the amount of After-Tax Contributions made by, and, if necessary, Matching Contributions made on behalf of Highly Compensated Employees who, for the Plan Year, made the largest After-Tax Contributions and had the largest amount of Matching Contributions made on their behalf to the next lower amount, and continuing this procedure until an amount equal to the aggregate amount of excess contributions has been removed from the Accounts of the Highly Compensated Employees.

(d)             To the extent provided in Treasury Regulations, the limitations described in this section do not apply to any group of eligible employees who are included in a unit of Employees covered by a collective bargaining agreement.

(e)              If the Administrator elects to apply Code section 410(b)(4)(B) in determining whether the Plan satisfies either of the tests described in Section 9.3(a)(i) for any Plan Year, all eligible employees who have not met either the minimum age and/or minimum service requirements of Code section 410(a)(1)(A) will be considered separately in accordance with the tests described in Section 9.3(a)(i).

(f)              To the extent deemed necessary by the Administrator in order to comply with such requirements, the Administrator may, in accordance with Plan Rules, prospectively decrease the rate at which a Participant may make After-Tax Contributions. 

9.4.           Multiple Use Limitation.

(a)              This section applies for any Plan Year for which the sum of the actual deferral percentage for eligible employees who are Highly Compensated Employees, plus the actual contribution percentage for eligible employees who are Highly Compensated Employees, exceeds the "aggregate limit."  For purposes of this subsection, the aggregate limit is the greater of:

(i)              The sum of:

(1)            the product of one and one-quarter, multiplied by the greater of

(A)           the actual deferral percentage for the Plan Year for eligible employees who are not Highly Compensated Employees or

(B)            the actual contribution percentage for the Plan Year for eligible employees who are not Highly Compensated Employees;

plus

(2)             the sum of two percentage points plus the lesser of the actual deferral percentage determined under item (A) of clause (1) above or the actual contribution percentage determined under item (B) of clause (1) above, with such sum in no case exceeding twice the lesser of such actual deferral percentage or actual contribution percentage;

or

(ii)            The sum of:

(1)            the product of one and one-quarter, multiplied by the lesser of

(A)           the actual deferral percentage for the Plan Year for eligible employees who are not Highly Compensated Employees or

(B)            the actual contribution percentage for the Plan Year for eligible employees who are not Highly Compensated Employees;

plus

(2)            the sum of two percentage points plus the greater of the actual deferral percentage determined under item (A) of clause (1) above or the actual contribution percentage determined under item (A) of clause (1) above, with such sum in no case exceeding twice the lesser of such actual deferral percentage or actual contribution percentage.

(b)             If, for any Plan Year, the calculations under Subsection (a) require that this section be applied, the Administrator  will determine the amount by which After-Tax Contributions made by, andMatching Contributions made on behalf of, each Highly Compensated Employee for the Plan Year causes the excess amount determined under Subsection (a), such determination being made in accordance with the provisions of Section 9.3(b).  At such time as the Administrator  specifies on or following the last day of the Plan Year for which such determination is made, but in no case later than the last day of the following Plan Year, the excess will be corrected in accordance with Section 9.3(c).

(c)              To the extent provided in Treasury Regulations, the limitations described in this section do not apply to any group of eligible employees who are included in a unit of employees covered by a collective bargaining agreement.

9.5.           Earnings or Losses on Excess Contributions.

(a)              The amount of Fund earnings or losses with respect to the excess amount of contributions returned to a Highly Compensated Employee pursuant to this article is an amount equal to the product of the total earnings or losses for the Participant's Account to which the excess contributions were credited for the Plan Year with respect to which the determination is being made, multiplied by a fraction, the numerator of which is the excess amount of contributions made on the Participant's behalf to such Account for the Plan Year, and the denominator of which is the closing balance of such Account for the Plan Year, decreased by the amount of earnings added to that Account, or increased by the amount of losses charged to that Account, for the Plan Year. 

(b)            Contributions returned pursuant to Section 9.6(c)(iii) will also include the earnings or losses attributable to such excess amount for the period between the end of the Plan Year with respect to which the determination is being made and the date on which such excess contributions are distributed to the Participant.  The earnings or losses attributable to such excess amount for such period will be an amount equal to the product of ten percent of the earnings or losses attributable to such excess amount for the Plan Year, as determined in accordance with Subsection (a), multiplied by the number of calendar months during the period for which the determination is being made, with a distribution being made on or before the fifteenth day of a month being deemed to have been made on the last day of the preceding month and a distribution being made after the fifteenth day of a month being deemed to have been made on the first day of the following month.

9.6.           Annual Additions Limitation.

(a)              Notwithstanding any contrary provisions of the Plan, there will not be allocated to any Participant's Accounts for a Plan Year any amount that would cause the aggregate "annual additions" with respect to the Participant for the Plan Year to exceed the lesser of:

(i)              $30,000 (or such dollar amount, adjusted to reflect increases in the cost of living, as in effect under Code section 415(c)(1)(A) for the calendar year during which the Plan Year in question begins); and

(ii)            25 percent of the Participant's Section 415 Wages for the Plan Year.

(b)             For purposes of Subsection (a), the "annual additions" with respect to a Participant for a Plan Year are the sum of:

(i)              the aggregate amount of 401(k), After Tax, Matching and Profit Sharing Contributions allocated to the Participant's Accounts under the Plan for the Plan Year (including the amount of any 401(k), Matching or After-Tax Contributions distributed to the Participant or forfeited pursuant to Section 9.2(d) or 9.3(c) but excluding any 401(k) Contributions in excess of the limitation set forth in Section 9.1 that are distributed to the Participant by April 15 of the year following the year to which such contributions relate) and employer contributions, employee contributions and forfeitures allocated to the Participant's accounts under any other qualified defined contribution plan maintained by any Affiliated Organization for the Plan Year; plus

(ii)            the amount, if any, attributable to post-retirement medical benefits that is allocated to a separate account for the Participant as a "key employee" within the meaning of Code section 416(i), to the extent required under Code section 419A(d)(1).

Unless otherwise provided in Treasury Regulations, if a 401(k), Matching or Profit Sharing Contribution with respect to a Plan Year is made more than 30 days after the due date (including extensions) of the Company's federal income tax return for the Company's taxable year coinciding with the Plan Year or in which the Plan Year ends, the contribution will be an annual addition for the Plan Year during which the contribution is made.  If an After-Tax Contribution with respect to a Plan Year is made more than 30 days after the end of the Plan Year, the contribution will be an annual addition for the Plan Year during which the contribution is made.

(c)              

(i)              To the extent deemed advisable by the Administrator to prevent the limitation under Subsection (a) from being exceeded, the Administrator may, in accordance with Plan Rules, prospectively decrease a Participant's After-Tax Contributions or 401(k) Contributions.

(ii)            If a further reduction of contributions is required, the amount of the Matching Contribution that would otherwise be allocated to the Participant's Account will be reduced and the aggregate amount of the Matching Contribution for the Plan Year will be reduced by the same amount and then the Profit Sharing Contribution that would otherwise be allocated to the Participant's Profit Sharing Contribution Account will be reduced and the aggregate amount of the Profit SharingContribution for the Plan Year will be reduced by the same amount.

(iii)          If, in spite of such reduction and as a result of the allocation of forfeitures or a reasonable error in estimating the amount of the Participant's Eligible Earnings, Section 415 Wages, 401(k) Contributions or other elective deferrals within the meaning of Code section 402(g)(3) for the Plan Year, the limitation would otherwise be exceeded, then, to the extent required to prevent such excess:

(1)            the amount of After-Tax Contributions made by the Participant for the Plan Year, together with earnings on such contributions, will be distributed to the Participant; then

(2)            the amount of 401(k) Contributions made for the Participant, together with earnings on such contributions, will be distributed to the Participant and any Matching Contributions attributable to the amount so distributed, together with earnings on such contributions, will be forfeited and applied as provided in Section 3.3(d); then

(3)            if a further excess would otherwise exist, the amount of such excess will be held unallocated in a suspense account and will be allocated to all other eligible Participants for the Plan Year and, to the extent necessary, subsequent Plan Years, before Matching and Profit Sharing Contributions are made for such Plan Year or Years, and will be applied toward the amount of such contributions for such Plan Year or Years.

9.7.           Administrator's Discretion.  Notwithstanding the foregoing provisions of this article, the Administrator may apply the provisions of Sections 9.1through 9.6 in any manner permitted by Treasury Regulations that will cause the Plan to satisfy the limitations of the Code incorporated in such sections and Treasury Regulations thereunder, and the Administrator's good faith application of Treasury Regulations is binding on all Participants and Beneficiaries.

ARTICLE 10. Service Rules

10.1.        Vesting Service.  The term "Vesting Service" with respect to an Employee means, except as provided in Section 10.3, the aggregate number of Plan Years during each of which the Employee completes at least 1000 Hours of Service.

10.2.        One-Year Break in Service.  An Employee will incur a "One-Year Break in Service" if the Employee fails to complete at least 500 Hours of Service during a Plan Year; provided, that, for purposes only of determining whether an Employee has incurred such a One-Year Break in Service, in addition to Hours of Service credited under Section 10.5, there will be taken into account the number of Hours of Service that otherwise would have been credited to the Employee, or, if the number of such hours of service cannot be determined, eight hours of service for each day on which the Employee would have otherwise performed services for an Affiliated Organization, during an authorized leave of absence, while still employed with the Affiliated Organization, pursuant to any established, nondiscriminatory leave policy of an Affiliated Organization or due to:

(a)              the Employee's pregnancy;

(b)             the birth of the Employee's child;

(c)              the placement of a child with the Employee in connection with the adoption of such child by the Employee; or

(d)             the Employee's caring for such child for a period beginning immediately following such birth or placement;

provided, first, that the total number of such additional Hours of Service taken in to account by reason of any such absence will not exceed 501; second, that, if the Employee would be prevented from incurring a One-Year Break in Service for the Plan Year in which such absence commenced solely because the additional Hours of Service are so credited, such Hours of Service will be credited only to such Plan Year or, if a One-Year Break in Service for such Plan Year would not be so prevented, such additional Hours of Service will be credited to the Plan Year following the Plan Year during which such absence commenced; and third, that, notwithstanding the foregoing, no such additional Hours of Service will be credited in connection with an absence for one of the reasons set forth at items (a) through (d) unless the Employee furnishes to the Administrator, on a timely basis, such information as the Administrator reasonably requires in order to establish the number of days during which the Employee was absent for that reason.  In addition, an Employee will be credited with Hours of Service for the purpose of determining whether he or she has incurred a One-Year Break in Service to the extent required by the Family and Medical Leave Act of 1993.

10.3.        Loss of Service.  If an Employee terminates employment and experiences at least five consecutive One-Year Breaks in Service, then:

(a)              if the Employee had a vested interest in his or her Account prior to the Breaks in Service,

(i)              his or her Vesting Service completed prior to such Breaks in Service will be taken into account in determining his or her vested interest in his or her Accounts attributable to contributions made for periods after the Breaks in Service but only if the Employee completes one year of Vesting Service following such Breaks in Service and

(ii)            the extent of the Employee's vested interest in his or her Accounts as determined under Section 7.1 prior to the Breaks in Service will not be increased by Vesting Service completed following the Breaks in Service; or

(b)             if the Employee had no vested interest in his or her Account prior to the Breaks in Service, the Employee's service completed prior to the Breaks in Service will not be taken into account for any purpose under the Plan.

10.4.        Pre-Acquisition Service.  Service with an entity (all or any portion of which is acquired by, merges with or becomes an Affiliated Organization) for any period prior to the date of the acquisition, merger or affiliation will be taken into account under this Plan only if, to the extent and for the purposes, specified on an exhibit to the Plan, as provided for in Section 14.1(f). 10.5.        Hour of Service.

(a)              Subject to the remaining subsections of this section, the term "Hour of Service," with respect to an Employee, includes and is limited to:

(i)              each hour for which the Employee is paid, or entitled to payment, for the performance of duties for an Affiliated Organization;

(ii)            each hour:

(1)            for which the Employee is paid, or entitled to payment, by an Affiliated Organization 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 (including disability), layoff, jury duty, military duty or leave of absence;

 (2)            for which the Employee is not paid or entitled to payment but which is required by federal law to be credited to the Employee on account of his or her military service or similar duties; and

(3)            for which back pay, irrespective of mitigation of damages, is either awarded or agreed to by an Affiliated Organization; provided, first, that Hours of Service taken into account under clause (i), (ii)(1) or (ii)(2) will not also be taken into account under this clause (3); and second, that Hours of Service taken into account under this clause (3) that relate to periods specified in clause (ii)(1) will be subject to the rules under Subsection (b). 

(b)            The following rules will apply for purposes of determining the Hours of Service completed by an Employee under Subsection (a)(ii)(1):

(i)              No more than 501 hours will be credited to the Employee on account of any single continuous period during which the Employee performs no duties (whether or not such period occurs in a single Plan Year);

(ii)            No more than the number of hours regularly scheduled for the performance of duties for the period during which no duties are performed will be credited to the Employee for such period;

 (iii)          The Employee will not be credited with hours for which payments are made or due under a plan maintained solely for the purpose of complying with workers compensation, unemployment compensation or disability insurance laws, or for which payments are made solely to reimburse the Employee for medical or medically related expenses;

(iv)          A payment will be deemed to be made by or due from an Affiliated Organization, regardless of whether such payment is made by or due from the Affiliated Organization directly or indirectly through a trust fund or insurer to which the Affiliated Organization contributes or pays premiums;

 (v)            If the payment made or due is calculated on the basis of units of time, the number of Hours of Service to be credited will be the number of regularly scheduled working hours included in the units of time on the basis of which the payment is calculated; provided, that, if such a payment is made to an Employee described in Subsection (d)(i), the number of Hours of Service to be credited will be the number of equivalent hours determined under Subsection (d)(i) that are included in the units of time on the basis of which the payment is calculated;

(vi)          If the payment made or due is not calculated on the basis of units of time, the number of Hours of Service to be credited will be equal to the amount of the payment, divided by the Employee's most recent hourly rate of compensation before the period during which no duties are performed; and

 (vii)        Hours will be determined in accordance with Section 2530.200(b)-2(b) of the Department of Labor Regulations which is incorporated herein by reference.

(c)              Hours of Service will be credited:

(i)              in the case of Hours of Service described in Subsection (a)(i), to the Plan Year in which the duties are performed;

(ii)            in the case of Hours of Service described in Subsection (a)(ii)(1), to the Plan Year or Plan Years in which the period during which no duties are performed occurs; provided, that, if the payment is not calculated on the basis of units of time, the Hours of Service will not be allocated between more than the first two Plan Years of such period;

(iii)          in the case of Hours of Service described in Subsection (a)(ii)(2), to the Plan Year or Plan Years determined by the Administrator in accordance with the applicable federal law;

(iv)          in the case of Hours of Service described in Subsection (a)(ii)(3), to the Plan Year or Plan Years to which the award or agreement for back pay pertains; and

(v)            as otherwise provided in Section 2530.200(b)-2(c) of the Department of Labor Regulations which is incorporated herein by reference.

(d)             For purposes of determining the number of Hours of Service completed by an Employee during a particular period of time:

(i)              an Employee who is not subject to the overtime provisions of the Fair Labor Standards Act of 1938, as from time to time amended, will be credited with 45 Hours of Service for each week during which he or she completes at least one Hour of Service; and

(ii)            each other Employee will be credited with the number of Hours of Service that he or she completes during such period.

(e)              Notwithstanding the foregoing provisions of this section, an individual will be credited with the number of Hours of Service he or she completes, determined in the manner specified in Subsections (a) through (d):

(i)              while a Leased Employee; and

(ii)            with any other organization to the extent such Hours of Service are required to be taken into account pursuant to Treasury Regulations under Code section 414(o).

ARTICLE 11. Adoption, Amendment and Termination

11.1.        Adoption by Affiliated Organizations.  With the prior approval of the Administrator, an Affiliated Organization may adopt this Plan and become a Participating Employer.  Any special provisions applicable to a Participating Employer's Employees will be set forth on an exhibit to the Plan.  Any adoption of the Plan by an Affiliated Organization will be effective only if approved in advance or subsequently ratified by the Company's Board prior to the end of the fiscal year of such Affiliated Organization in which it adopts the Plan. 11.2.        Authority to Amend and Procedure.

(a)              The Company reserves the right to amend the Plan at any time, to any extent.  Each amendment must be stated in a written instrument approved in advance or subsequently ratified by the Company's Board and executed in the name of the Company by a duly authorized officer or the Company's Director of Compensation, Benefits & HRIS, and attested by the Secretary or an Assistant Secretary.  On and after the effective date of the amendment, all interested persons will be bound by the amendment; provided, that no amendment will have any retroactive effect so as to deprive any Participant, or any Beneficiary of a deceased Participant, of any benefit already accrued or vested or of any option with respect to the form of such benefit that is protected under Code section 411(d)(6), except that an amendment required to qualify the Trust for income tax exemption may be retroactive to the Effective Date of the Plan or to any later date.

(b)             If the provisions for determining the extent to which benefits under the Plan are vested are changed, whether by amendment or because of the Plan's becoming or ceasing to be a top-heavy plan, each Participant who has completed at least three years of Vesting Service may elect to have his or her vested benefits determined without regard to such change by giving written notice of such election to the Administrator within the period beginning on the date such change was adopted (or the Plan's top heavy status changed) and ending 60 days after the latest of:  (i) the date such change is adopted; (ii) the date such change becomes effective; and (iii) the date the Administrator issues notice of such change to the Participant. 

(c)              To the extent required by Code section 411(d)(6), each Participant may elect to have that portion of his or her Accounts that was accrued as of the date an optional form of benefit payment is eliminated distributed in such optional form.

(d)             The provisions of the Plan in effect at the termination of a Participant's employment will, except as specifically provided in any subsequent amendment, continue to apply to such Participant.

11.3.        Authority to Terminate and Procedure.  The Company expects to continue the Plan indefinitely but reserves the right to terminate the Plan in its entirety at any time by a written instrument of termination.  Each Participating Employer expects to continue its participation in the Plan indefinitely but reserves the right to cease its participation in the Plan at any time.  The Plan will terminate in its entirety as of the date specified by the Company in a written notice adopted and executed in the manner of an amendment.  The Plan will terminate with respect to a Participating Employer as of a date specified in a written instrument approved in advance or ratified by the Participating Employer's Board and executed in the name of the Participating Employer by a duly authorized officer. 

11.4.        Vesting Upon Termination, Partial Termination or Discontinuance of Contributions.  Upon the termination of the Plan or upon the complete discontinuance of contributions, the Accounts of each "affected employee" will vest in full.  For purposes of this section, "affected employee" means

(a)              a Participant who is actively employed with an Affiliated Organization on the effective date of the termination or complete discontinuance of contributions;

(b)            a Participant who has terminated employment and has neither received a complete distribution of his or her Account nor experienced at least five consecutive One-Year Breaks in Service;

(c)             a former Participant who terminated employment during the Plan Year that includes the effective date of the termination or complete discontinuance of contributions.

Upon a partial termination of the Plan, the Accounts of each Participant as to whom the Plan has been partially terminated will vest in full.

11.5.        Distribution Following Termination, Partial Termination or Discontinuance of Contributions.  After termination or partial termination of the Plan or the complete discontinuance of contributions under the Plan, the Trustee will continue to hold and distribute the Fund as if such event had not occurred, but if the Administrator so directs in accordance with Treasury Regulations, the Trustee will distribute to each Participant the entire balance of his or her Accounts.

ARTICLE 12. PLAN ADMINISTRATION

12.1.        Administrator, Named Fiduciary.  The Company is the "named fiduciary" of the Plan for purposes of ERISA.  12.2.       Committee. 

(a)              The general administration of the Plan and the duty to carry out its provisions is vested in a Committee composed of not fewer than three members who will serve at the pleasure of the Company's Board.  One member of the Committee will be the head of the Company's human resources function, a second member of the Committee will be the head of the Company's financial function and a third member of the Committee will be the head of the Company's treasury function. Additional members may be appointed to the Committee by the Company's Board to serve at its pleasure. Each such additional member will file written acceptance of his or her appointment with the Company's Board.  A Committee member may resign by delivering his or her written resignation to the Company's Board, and any Committee member may be removed, with or without cause, by the Company's Board upon delivery of written notice of such removal to the removed member.  Any such resignation or removal will be effective upon delivery of the written resignation or notice of removal, as the case may be, or upon any later date specified therein.  Vacancies created by any such resignation or removal will be filled by appointment by the Company's Board; provided, that, subject to there being at least three persons serving as Committee members at all times, the Company's Board need not fill any vacancy so created.

(b)             In addition to its general duties and power and authority in connection with the administration of the Plan, the Committee has the discretionary power and authority with respect to -

(i)               The selection, designation and removal of the Administrator, the Trustee and any investment managers of the Fund;

(ii)             The direction of investments of assets comprising the Fund in insurance-company issued deposit administration or similar group annuity contract or contracts; and

(iii)           In the case of any investment fund maintained pursuant to Section 5.1 the assets of which are primarily invested in one or more insurance company issued deposit administration or group annuity contracts, to determine, from time to time, the portion of such investment fund, if any, that will not be invested in such insurance-company issued contracts and to direct the Trustee as to the specific investments or types of investments with respect to such portion of such investment fund; provided, that nothing contained in this clause (iii) requires the Committee to exercise such power or authority or limits the power or authority of the Committee to delegate any such duties to the Administrator, the Trustee or any investment manager.

(c)              The Committee will perform its duties in accordance with the following procedures.

(i)               The head of the Company's human resources function will act as the chair of the Committee and will preside over the Committee's meetings.

(ii)             The Committee will designate the head of the Company's human resources function, or such other person as it may determine, to serve as Administrator pursuant to Section 12.3, and may from time to time revoke such designation and designate another person to serve as Administrator. Each such designation must be in writing, and a copy of the designation must be furnished to the Administrator and the Trustee.  The person designated to act as Administrator must file a written acceptance with the Committee.  Such person's duty hereunder will terminate upon revocation of such designation by the Committee or upon resignation as Administrator by the person so designated. Such revocation or resignation must be in writing and will be effective upon delivery thereof to the Administrator or the Committee as the case may be, and in either case to the Trustee.

(iii)           The Committee will elect a secretary who may, but need not, be a member of the Committee.  The secretary will keep minutes of the Committee's meetings and perform such other duties as may be specified from time to time by the Committee.

(iv)           The Committee may appoint such subcommittees with such duties and powers as it may specify, and it may delegate administrative powers to one or more of its members or to such other person or entity as it may designate.

(v)             The Committee will meet at such times and places and upon such notice as its members may determine from time to time.  A majority of the current membership of the Committee will constitute a quorum for the transaction of business, and all acts of the Committee at any meeting will require, for their validity, the affirmative vote of a majority of the current membership of the Committee.  The Committee may act without a meeting by the written authorization of a majority of the members of the Committee.

(vi)           The Committee may adopt bylaws for the conduct of its business, provided such bylaws are not inconsistent with the provisions of this article.

(vii)         No member of the Committee may vote with respect to a decision of the Committee relating solely to his or her own participation or benefit under the Plan.

12.3.        Administrative Duties.  To the extent applicable to their respective administrative duties, the Committee and the Administrator have the discretionary power and authority, and the responsibility, to:

(a)              Adopt rules, regulations and procedures not inconsistent with the provisions of the Plan and uniform and equitable with respect to individuals determined by the Administrator to be similarly situated at the time in question, and to revoke or modify such rules and regulations at any time;

(b)             Interpret, construe, apply and enforce the provisions of the Plan and any Plan Rules, including the discretionary and final power and authority to interpret, construe, apply and enforce uncertain provisions of the Plan or Plan Rules, and remedy possible ambiguities, inconsistencies, omissions and errors, and any such action taken by the Committee or the Administrator in good faith is binding upon all Participants, Beneficiaries, alternate payees and other interested persons;

(c)              Determine from time to time the status of all Employees, Qualified Employees, Participants, Beneficiaries, alternate payees and other interested persons for purposes of the Plan;

(d)             Determine the rights of Employees, Qualified Employees, Participants, Beneficiaries, alternate payees and other interested persons to benefits under the Plan, the amount and the method and time or times of payment of the benefit; and

(e)              Take any other actions determined by the Committee or the Administrator to be necessary or advisable to in connection with the administration of the Plan.

12.4.        Delegation.  Except as otherwise provided in ERISA, the Administrator may delegate specific duties and responsibilities, including fiduciary duties and responsibilities.  Such delegations may be to Employees or to other individuals, committees or entities.  Any delegation may, if specifically stated, allow further delegations by the individual, committee or entity to whom or which the delegation has been made subject to and in accordance with any limitations, restrictions or conditions specified in the delegation or in any other written instrument provided by the Administrator to the individual, committee or entity to whom or which the delegation has been made.  Any delegation may be rescinded by the Administrator at any time.  Each individual, committee or entity to whom or which a fiduciary duty or responsibility has been delegated is responsible for the exercise of such duties or responsibilities and is not responsible for the acts or failure to act of any other fiduciary.  Any delegation by the Administrator of a fiduciary duty or responsibility, other than to a person for whose conduct the Administrator remains responsible, must be in writing, and the individual, committee or entity to whom or which the delegation is made must submit a written acceptance of the delegation to the Administrator.  Any delegate's duty will terminate upon withdrawal of such authority by the Administrator or upon withdrawal of the delegate's acceptance.  Any delegation to an Employee will automatically terminate when he or she ceases to be an Employee.

12.5.        Reports and Records.  The Administrator and those individuals, committees or entities to whom or which theAdministrator has delegated fiduciary duties will keep records of all their proceedings and actions, and will maintain all such books of account, records and other data as necessary for the proper administration of the Plan and to comply with applicable law. 

12.6.        Compensation.  No employee of an Affiliated Organization acting in a fiduciary capacity will be entitled to receive compensation from the Trust for such services, but each will be  entitled to reimbursement from the Trust for all sums reasonably and necessarily expended in the performance of such duties.

12.7.        Professional Assistance.  The Committee and the Administrator may retain such accounting, recordkeeping, legal, clerical and other services as may reasonably be required in the administration of the Plan, and may pay reasonable compensation from the Fund for such services or may reimburse the Company from the Fund for reasonable compensation paid by the Company for such services.  The Committee and the Administrator are entitled to rely conclusively on all tables, valuations, certificates, opinions and reports furnished to them by such persons and on all information, elections and designations furnished to them by Participants, Beneficiaries, alternate payees and Participating Employers.

12.8.        Payment of Administrative Costs.  All costs of administering the Plan may be paid by the Trustee from the Trust, but if not so paid, will be paid by the Company.

12.9.        Indemnification.

(a)              To the extent permitted by law, the Participating Employers jointly and severally agree to indemnify and hold harmless the Administrator, the members of any fiduciary committee and other employees, officers or directors of an Affiliated Organization to whom fiduciary duties are delegated against any and all claims, losses, damages, expenses and liabilities arising from their responsibilities in connection with the Plan which are not covered by insurance (without recourse) paid for by the Participating Employers or otherwise paid or reimbursed, unless they are determined to be due to gross negligence or intentional misconduct.  The Company has the right, but not the obligation, to select counsel and control the defense and settlement of any action for which an individual may be entitled to indemnification pursuant to this section.

(b)             An individual's right to indemnification pursuant to this section is in addition to, and independent of, the individual's right, if any, to indemnification pursuant to a Participating Employer's articles of incorporation or bylaws (or comparable governing instruments), applicable law or otherwise, but an individual is not entitled to indemnification from all sources in an amount that exceeds his or her claims, losses, damages, expenses and liabilities.

12.10.     Claims Procedure.

(a)              The Administrator will notify a Participant in writing, within 90 days of the Participant's written application for benefits, of the Participant's eligibility or noneligibility for benefits under the Plan.  If the Administrator determines that a Participant is not eligible for benefits or full benefits, the notice will:

(i) state the specific reasons for the denial of any benefits;

(ii) provide a specific reference to the provision of the Plan on which the denial is based;

(iii) provide a description of any additional information or material necessary for the claimant to perfect the claim, and a description of why it is needed; and

(iv) provide an explanation of the Plan's claims review procedure and other appropriate information as to the steps to be taken if the Participant wishes to have the claim reviewed.  If the Administrator determines that there are special circumstances requiring additional time to make a decision, the Administrator will notify the Participant of the special circumstances and the date by which a decision is expected to be made, and may extend the time for up to an additional 90-day period. 

(b)             If a Participant is determined by the Administrator not to be eligible for benefits or if the Participant believes that he or she is entitled to greater or different benefits, the Participant will be provided the opportunity to have his or her claim reviewed by the Administrator by filing a petition for review with the Administrator within 60 days after the Participant receives the notice issued by the Administrator.  The petition must state the specific reasons the Participant believes he or she is entitled to benefits or greater or different benefits.  Within 60 days after the Administrator receives the petition, the Administrator  will give the Participant (and his or her counsel, if any) an opportunity to present his or her position to the Administrator orally or in writing, and the Participant (or his or her counsel) may review the pertinent documents, and the Administrator will notify the Participant of its decision in writing within said 60-day period, stating specifically the basis of the decision written in a manner calculated to be understood by the Participant and the specific provisions of the Plan on which the decision is based.  If, because of the need for a hearing, the 60-day period is not sufficient, the decision may be deferred for up to another 60-day period at the election of the Administrator, but notice of this deferral must be given to the Participant. 

(c)              In the event of the death of a Participant, the same procedure applies to the Beneficiary of the Participant. 

(d)             A claimant must exhaust the procedure described in this section before pursuing the claim in any other proceeding.

12.11.     Disputes.

(a)              A Participant, Beneficiary or alternate payee may not commence a civil action pursuant to ERISA section 502(a)(1), with respect to a benefit under the Plan after the earlier of:

(i)              three years after the occurrence of the facts or circumstances that give rise to or form the basis for such action; and

(ii)            one yearfrom the date the Participant, Beneficiary or alternate payee had actual knowledge of the facts or circumstances that give rise to or form the basis for such action.

(b)            In the case of a dispute between a Participant, Beneficiary, alternate payee or other person claiming a right or entitlement pursuant to the Plan and a Participating Employer, the Administrator, the Committee or other person relating to or arising from the Plan, the United States District Court for the District of Minnesota is a proper venue.  Regardless of where an action relating to or arising from the Plan is pending, the law as stated and applied by the United States Court of Appeals for the Eighth Circuit or the United States District Court for the District of Minnesota will apply to and control all actions relating to the Plan brought against the Plan, a Participating Employer, the Administrator, the Committee or any other person or against any Participant, Beneficiary, alternate payee or other person claiming a right or entitlement pursuant to the Plan.

12.12.     Correction of Errors.  If the Administrator determines that, by reason of administrative error or other cause attributable to a Participating Employer, the Account of any Participant has incurred a loss, the Administrator may enter into an agreement with the Participating Employer under which the Account is fully restored and may, upon such restoration, release the Participating Employer from further responsibility.

12.13.    Standards for Elections, Directions and Similar Actions.  Any election, direction, application, designation or similar action required of a Participant, Beneficiary or alternate payee (or any person claiming by, through or on behalf of a Participant, Beneficiary or alternate payee) pursuant to the Plan must be made in accordance with and is subject to the terms of the Plan and Plan Rules.

ARTICLE 13. Miscellaneous

13.1.        Merger, Consolidation, Transfer of Assets.  If this Plan is merged or consolidated with, or his or her assets or liabilities are transferred to, any other plan, each Participant will be entitled to receive a benefit immediately after such merger, consolidation or transfer (if such other plan were then terminated) that is equal to or greater than the benefit he or she would have been entitled to receive immediately before such merger, consolidation or transfer (if this Plan had then terminated but without regard to Section 11.4).

13.2.        Limited Reversion of Fund.

(a)              Except as provided in Subsection (b), no corpus or income of the Trust will at any time revert to any Affiliated Organization or be used other than for the exclusive benefit of Participants and their Beneficiaries by paying benefits and administrative expenses of the Plan.

(b)             Notwithstanding any contrary provision in the Plan:

(i)              All contributions made by a Participating Employer to the Trustee prior to the initial determination of the Internal Revenue Service as to qualification of the Plan under Code section 401(a) and the tax exempt status of the Trust under Code section 501(a) will be repaid by the Trustee to the Participating Employer, upon the Participating Employer's written request, if the Internal Revenue Service rules that the Plan is not qualified or the Trust is not tax exempt; provided, that the Participating Employer must request such determination within a reasonable time after adoption of the Plan and the repayment by the Trustee to the Participating Employer must be made within one year after the date of denial of qualification of the Plan; and

(ii)            To the extent a contribution is made by a Participating Employer by a mistake of fact or a deduction is disallowed a Participating Employer under Code section 404, the Trustee will repay the contribution to the Participating Employer upon the Participating Employer's written request; provided, that such repayment must be made within one year after the mistaken payment is made or the deduction is disallowed, as the case may be.  Each contribution to the Plan by a Participating Employer is expressly conditioned on such contribution's being fully deductible by the Participating Employer under Code section 404.

13.3.        Top-Heavy Provisions.

(a)             The provisions of this subsection will apply for any Plan Year during which the Plan is "top heavy."

(i)              Notwithstanding the provisions of Article 3, no contributions will be made and allocated on behalf of any "key employee" for any Plan Year during which the Plan is top heavy unless the amount of contributions (excluding 401(k) Contributions) made and allocated for such Plan Year on behalf of each Participant who is not a key employee and who is employed with an Affiliated Organization on the last day of the Plan Year, expressed as a percentage of the Participant's Testing Wages for the Plan Year, is at least equal to the lesser of:

(1)            three percent; or

(2)            the largest percentage of such Testing Wages at which contributions (including 401(k) Contributions) are made and allocated on behalf of any key employee for such Plan Year.

(ii)            If, in addition to this Plan, an Affiliated Organization maintains another qualified defined contribution plan or one or more qualified defined benefit pension plans during a Plan Year, the provisions of clause (i) will be applied for such Plan Year:

(1)            by taking into account the employer contributions (other than elective deferrals for a non-key employee) on behalf of the Participant under all such defined contribution plans; and

(2)            without regard to any Participant who is not a key employee and whose accrued benefit, expressed as a single life annuity, under a defined benefit pension plan maintained by the Affiliated Organization for such Plan Year is not less than the product of

(A)           the Participant's average Testing Wages for the period of consecutive years not exceeding the period of consecutive years (not exceeding five) when the Participant had the highest aggregate Testing Wages, disregarding years in which the Participant completed less than 1000 Hours of Service, multiplied by

(B)           the lesser of (I) two percent per year of service, disregarding years of service beginning after the close of the last Plan Year in which such defined benefit plan was a top heavy plan or (II) 20 percent.

(iii)          Notwithstanding Section 7.1(h), each Participant's vested nonforfeitable interest in the portion of his or her Profit Sharing Contribution Account not described in Section 7.1(a) to the extent provided in the following schedule:

Full Years of Vesting Service Less than Three Years
Three or More Years Vested
Interest

  0  %
100%

If the Plan ceases to be a top heavy plan, the portion of a Participant's Profit Sharing Contribution Account that has vested pursuant to the foregoing schedule will remain nonforfeitable, notwithstanding the subsequent application of the vesting schedule set forth in Section 7.1(h) to amounts subsequently allocated to the Account.

(b)            For purposes of Subsection (a),

(i)               

(1)            The Plan will be a "top-heavy plan" for a particular Plan Year if, as of the last day of the initial Plan Year or, with respect to any other Plan Year, as of the last day of the preceding Plan Year, the aggregate of the Account balances of key employees is greater than 60 percent of the aggregate of the Account balances of all Participants.

(2)            For purposes of calculating the aggregate Account balances for both key employees and employees who are not key employees:

(A)           Any distributions made within the five-year period preceding the Plan Year for which the determination is being made, other than a distribution transferred or rolled over to a plan maintained by an Affiliated Organization, will be included;

(B)           Amounts transferred or rolled over from a plan not maintained by an Affiliated Organization at the initiation of the Participant will be excluded;

(C)           The Account balances of any key employee and any employee who is not a key employee who has not performed an Hour of Active Service at any time during the five-year period ending on the date as of which the determination is being made will be excluded; and

(D)           The terms "key employee" and "employee" include the Beneficiaries of such persons who have died.

(ii)             

(1)            Notwithstanding the provisions of clause (i), this Plan will not be a top-heavy plan if it is part of either a "required aggregation group" or a "permissive aggregation group" and such aggregation group is not top-heavy.  An aggregation group will be top-heavy if the sum of the present value of accrued benefits and account balances of key employees is more than 60 percent of the sum of the present value of accrued benefits and account balances for all Participants, such accrued benefits and account balances being calculated in each case in the same manner as set forth in clause (i).

(2)            Each plan in a required aggregation group will be top-heavy if the group is top-heavy.  No plan in a required aggregation group will be top-heavy if the group is not top-heavy.

(3)            If a permissive aggregation group is top-heavy, only those plans that are part of an underlying top-heavy, required aggregation group will be top-heavy. No plan in a permissive aggregation group will be top-heavy if the group is not top-heavy.

(iii)          The "required aggregation group" consists of (1) each plan of an Affiliated Organization in which a key employee participates and (2) each other plan of an Affiliated Organization that enables a plan in which a key employee participates to meet the nondiscrimination requirements of Code sections 401(a)(4) or 410.

(iv)          A "permissive aggregation group" consists of those plans that are required to be aggregated and one or more plans (providing comparable benefits or contributions) that are not required to be aggregated, which, when taken together, satisfy the requirements of Code sections 401(a)(4) and 410.

 (v)            For purposes of applying clauses (ii), (iii) and (iv) of this Subsection (b), any qualified defined contribution plan maintained by an Affiliated Organization at any time within the five-year period preceding the Plan Year for which the determination being made which, as of the date of such determination, has been formally terminated, has ceased crediting service for benefit accruals and vesting and has been or is distributing all plan assets to participants or their beneficiaries, will be taken into account to the extent required or permitted under such clauses and under Code section 416.

(c)             A "key employee" is any individual who is or was employed with an Affiliated Organization and who, at any time during the Plan Year in question or any of the preceding four Plan Years is or was:

(i)              An officer of the Affiliated Organization (an administrative executive in regular and continued service with the Affiliated Organization) whose Section 415 Wages for such Plan Year exceed 50 percent of the amount in effect under Code section 415(b)(1)(A) for such Plan Year, but in no case will there be taken into account more than the lesser of (a) 50 persons, or (b) the greater of (i) three persons or (ii) ten percent of the number of the Affiliated Organization's employees, excluding for purposes of determining the number of such officers, any employees described in Code section 414(q)(5);

(ii)            The owner of an interest in the Affiliated Organization that is not less than the interest owned by at least ten other persons employed with the Affiliated Organization; provided, that, such owner will not be a key employee solely by reason of such ownership for a Plan Year if he or she does not own more than one-half of one percent of the value of the outstanding interests of the Affiliated Organization or if the amount of his or her Section 415 Wages for such Plan Year is less than the amount in effect under Code section 415(c)(1)(A) for such Plan Year;

(iii)          The owner of more than five percent of the Affiliated Organization's outstanding stock or more than five percent of the total combined voting power of the Affiliated Organization's stock; or

 (iv)          The owner of more than one percent of the Affiliated Organization's outstanding stock or more than one percent of the total combined voting power of the Affiliated Organization's stock, whose Section 415 Wages for such Plan Year exceed $150,000.

For purposes of this Subsection (c), ownership of an Affiliated Organization's stock will be determined in accordance with Code section 318; provided, that subparagraph 318(a)(2)(C) will be applied by substituting the phrase "5 percent" for the phrase "50 percent" wherever it appears in such Code section.

13.4.       Qualified Military Service.

(a)              The provisions of this section apply only to an Employee who is reemployed on or after December 12, 1994 and whose reemployment rights are protected under the Uniformed Services Employment and Reemployment Rights Act of 1994 ("USERRA") and are intended to comply with the requirements of Code section 414(u).

(b)             Notwithstanding any other provisions of the Plan to the contrary, a Qualified Employee who leaves the employ of a Participating Employer for qualified military service and returns to employment with a Participating Employer will be entitled to the restoration of benefits under the Plan which would have accrued but for the Qualified Employee's absence due to qualified military service. 

(c)              A Qualified Employee may make 401(k) Contributions and After-Tax Contributions for the Plan Years during which he or she would have been an Active Participant but for his or her qualified military service in accordance with Sections 3.1 and 3.2 and the following additional rules:

(i)              the Qualified Employee may elect to make 401(k) Contributions and After-Tax Contributions, subject to the maximums in effect pursuant to Sections 3.1 and 3.2 during the period of qualified military service;

(ii)            the Qualified Employee may make the election described in clause (i) at any time during the period that begins on his or her date of reemployment and has the same length as the lesser of five years or the period of the Qualified Employee's qualified military service multiplied by three;

(iii)          the 401(k) Contributions and After-Tax Contributions under this subsection are not subject to the limitations described in Section 9.2, 9.3 or 9.4.

(d)             A Qualified Employee's Participating Employer will make Matching Contributions with respect to the Qualified Employee's 401(k) Contributions pursuant to Subsection (c) in the same amount as if such 401(k) Contributions had actually been made during the Participant's period of qualified military service.  The Matching Contributions made pursuant to this subsection are not subject to the limitations described in Section 9.3 or 9.4.

(e)              The following additional rules and conditions apply with respect to qualified military service notwithstanding any contrary provision of the Plan:

(i)              an Employee will not be treated as having incurred a Break in Service by reason of his or her qualified military service;

(ii)            any period of qualified military service will be counted as Vesting Service;

(iii)          for purposes of determining the Qualified Employee's Eligible Earnings and Section 415 Wages, the Qualified Employee will be treated as receiving compensation from the Participating Employer with whom he or she was employed immediately before the period of qualified military service during the period of qualified military service in an amount equal to the compensation he or she would have received during such period if he or she were not in qualified military service determined based on the rate of pay the Qualified Employee would have received from the Participating Employer but for the absence due to qualified military service; provided, however, if the compensation the Qualified Employee would have received from the Participating Employer is not reasonably certain, then the Qualified Employee's rate of compensation will be equal to his or her average compensation for the 12-month period preceding the qualified military service (or, if shorter, the period of employment immediately preceding the qualified military service);

(iv)          contributions on behalf or by the Qualified Employee will be subject to the limitations in Sections 9.1 and 9.6 with respect to the Plan Years to which such contributions relate in accordance with Treasury Regulations;

(v)            the Qualified Employee will not be entitled to any crediting of earnings on contributions for any period prior to actual payment to the Trust; and

(vi)          the Qualified Employee will not be entitled to restoration of any forfeitures which were not allocated to his or her Account as a result of his or her qualified military service.

(f)               For purposes of this section, "qualified military service" means any service in the uniformed services as defined in USERRA by a Qualified Employee who is entitled to reemployment rights with a Participating Employer under USERRA.

13.5.        Short Plan Years.  To the extent required by and in accordance with Treasury Regulations, for any Plan Year that is less than 12 months long, the dollar limitations in effect for purposes of Code sections 401(a)(17), 414(q), 415 and 416 will be adjusted to reflect the short Plan Year.

ARTICLE 14. Construction, Interpretations AND DEFINITIONS

14.1.        Construction and Interpretations.  The rules of construction and interpretations set forth in this section apply in construing this instrument unless the context otherwise indicates.

(a)             Consent of Spouse.  Whenever the consent of a Participant's spouse is required with respect to any act of the Participant, such consent will be deemed to have been obtained only if:

(i)              the Participant's spouse executes a written consent to such act, which consent acknowledges the effect of such act and is witnessed by a Plan representative or a notary public; or

(ii)            the Administrator determines that no such consent can be obtained because the Participant has no spouse, because the Participant's spouse cannot be located, or because of such other circumstances as may, under Treasury Regulations, justify the lack of such consent.

Any such consent by the Participant's spouse or such determination by the Administrator that such spouse's consent is not required is effective only with respect to the particular spouse of the Participant who so consented or with respect to whom such determination was made.  Any such consent by the Participant's spouse to an act of the Participant under the Plan is irrevocable with respect to that act.

(b)            Governing Law.  To the extent that state law is not preempted by provisions of ERISA or any other laws of the United States, this Plan will be administered, construed, and enforced according to the internal, substantive laws of the State of Minnesota, without regard to its conflict of laws rules.

(c)             Headings.  The headings of articles and sections are included solely for convenience.  In the case of a conflict between a heading and the text of the Plan, the text controls.

(d)            No Employment Rights Created.  The establishment and maintenance of the Plan neither gives any Employee a right to continuing employment nor limits the right of an AffiliatedOrganization to discharge or otherwise deal with the Employee without regard to the effect such action might have on his or her initial or continued participation in the Plan.

(e)             Number and Gender.  Wherever appropriate, the singular number may be read as the plural, the plural may be read as the singular, and the masculine gender may be read as the feminine gender.

(f)              Special Provisions.  Special provisions of the Plan applicable only to certain Participants will be set forth on an exhibit to the Plan.  In the event of a conflict between the terms of the exhibit and the terms of the Plan, the exhibit controls.

14.2.        Definitions.  The definitions set forth in this section apply in construing this instrument unless the context otherwise indicates.

Account.  An "Account" with respect to a Participant is any or all of the accounts maintained on his or her behalf pursuant to Section 4.1, as the context requires.

Active Participant.  An "Active Participant" is a Participant who is a Qualified Employee.

Administrator.  The "Administrator" of the Plan is the Company or any individual or committee to whom or to which administrative duties are delegated by the Company with respect to the delegated duties.

Affiliated Organization.  An "Affiliated Organization" is the Company and any other corporation that is a member of a controlled group of corporations (within the meaning of Code section 1563(a) without regard to Code sections 1563(a)(4) and 1563(e)(3)(C)) that includes the Company, any trade or business (whether or not incorporated) that together with the Company is under common control (within the meaning of Code section 414(c)), any member of an "affiliated service group" (within the meaning of Code section 414(m)) of which the Company is a member or any other organization that, together with the Company, is treated as a single employer pursuant to Code section 414(o) and Treasury Regulations thereunder; provided, that, for purposes of applying the limitations set forth at Section 9.6, such determination under Code section 1563(a) will be made by substituting the phrase "more than 50 percent" for the phrase "at least 80 percent" wherever it appears in such Code section.

After-Tax Contribution Account.  The "After-Tax Contribution Account" is the account established pursuant to Section 4.1(a)(ii).

After-Tax Contributions.  "After-Tax Contributions" means contributions made by an Active Participant pursuant to Section 3.2.

Beneficiary.  A "Beneficiary" is a person designated or otherwise determined under the provisions of Section 8.2 as the distributee of benefits payable after the death of a Participant.  A person designated as, or otherwise determined to be, a Beneficiary under the terms of the Plan has no interest in or rights under the Plan until the Participant in question has died.  A Beneficiary will cease to be such on the day on which all benefits to which he, she or it is entitled under the Plan have been distributed.

Board.  The "Board" is the board of directors or comparable governing body of the Affiliated Organization in question.  When the Plan provides for an action to be taken by the Board, the action may be taken by any committee or individual authorized to take such action pursuant to a proper delegation by the board of directors or comparable governing body in question.

Code.  The "Code" is the Internal Revenue Code of 1986, as amended.  Any reference to a specific provision of the Code includes a reference to such provision, any valid ruling, regulation or authoritative pronouncement promulgated thereunder and any provision of future law that amends, supplements or supersedes the provision.

Committee.  The "Committee" is the administrative committee constituted under Section 12.2.

Company.  The "Company" is BMC Industries, Inc. or any successor thereto.

Company Stock.  "Company Stock" is the common stock of the Company.

Disabled.  A Participant will be considered to be "Disabled" only if

(a)       in the case of a Participant who is participating in the Company's long-term disability plan, he or she is receiving disability benefits under such plan, or

(b)       in the case of any other Participant, he or she is certified as being disabled by the Social Security Administration and is receiving disability benefits under the disability provisions of the Social Security Act.

Effective Date.  The "Effective Date" of the Plan is April 1, 1979.

Eligible Earnings. 

(a)             The "Eligible Earnings" of a Participant from a Participating Employer for any Plan Year for purposes of 401(k) Contributions, After-Tax Contributions and Matching Contributions is the sum of all remuneration paid to the Participant by the Participating Employer for the portion of a Plan Year in which he or she is an Active Participant that is reportable in the "wages, tips, other compensation" box of Internal Revenue Form W-2, increased by amounts that are deferred under Section 3.1 as 401(k) Contributions and amounts by which a Participant's compensation from the Participating Employer for such portion of the Plan Year is reduced under a Code section 125 cafeteria plan or by reason of Code section 132(f)(4).  To the extent otherwise included, Eligible Earnings are determined under this clause (a) by excluding the amount of any imputed income of the Participant with respect to the portion of the Plan Year in which he or she is an Active Participant, severance pay of any kind or nature, tuition aid, relocation reimbursement, payments made pursuant to the BMC Industries, Inc. Long-Term Incentive Plan or amounts attributable to a stock incentive award (including, but not limited to stock options, stock appreciation rights, restricted stock, performance units or stock bonuses).

(b)            The "Eligible Earnings" of a Participant from a Participating Employer for any Plan Year for the purpose of Profit Sharing Contributions is:

            (i)        for non-sales personnel --

            the Participant's annual base salary or wages paid to the Participant by the Participating Employer during the Plan Year, including shift premium, increased by amounts paid to the Participant by the Participating Employer during the Plan Year for time in excess of straight time but disregarding the portion of such amounts, if any, representing a premium over straight time rates, and

            (ii)       for sales personnel --

            the greater of (A) the Participant's annual base salary paid by the Participating Employer during the Plan Year, or (B) the lesser of (1) the Participant's annual base salary plus commissions paid by the Participating Employer during the Plan Year or (2) $60,000.

            To the extent otherwise included, Eligible Earnings are determined under this clause (b) by excluding severance pay of any kind or nature, tuition aid, relocation reimbursement, payments made pursuant to the BMC Industries, Inc. Long-Term Incentive Plan or amounts attributable to a stock incentive award (including, but not limited to stock options, stock appreciation rights, restricted stock, performance units or stock bonuses).

(c)              In no event will a Participant's Eligible Earnings for any Plan Year be taken into account to the extent it exceeds $150,000 (or such larger amount as may be permitted for the calendar year during which such Plan Year begins under Code section 401(a)(17)).

Eligible Rollover Distribution.  An "Eligible Rollover Distribution" is any distribution of all or any portion of the balance to the credit of the distributee, except that an Eligible Rollover Distribution does not include: any distribution that is one of a series of substantially equal periodic payments (not less frequently than annually) made for the life (or life expectancy) of the distributee or the joint lives (or joint life expectancies) of the distributee and the distributee's designated beneficiary, or for a specified period of ten years or more; any distribution to the extent such distribution is required under Code section 401(a)(9); the portion of any distribution that is not includable in gross income (determined without regard to the exclusion for net unrealized appreciation with respect to employer securities); any hardship distribution described in Code section 401(k)(2)(B)(i)(IV); and any other amount excepted from the definition of "eligible rollover distribution" by Code section 402(c)(4).

Employee.  An "Employee" is any individual who performs services for an Affiliated Organization as a common-law employee of the Affiliated Organization.

ERISA.  "ERISA" is the Employee Retirement Income Security Act of 1974, as amended.  Any reference to a specific provision of ERISA includes a reference to such provision, any valid ruling, regulation or authoritative pronouncement promulgated thereunder and any provision of future law that amends, supplements or supersedes the provision.

Excess Eligible Earnings.  The "Excess Eligible Earnings" of a Participant from a Participating Employer for a Plan Year means the portion of his or her Eligible Earnings from the Participating Employer for the Plan Year, if any, in excess of the contribution and benefit base in effect for the calendar year during which the Plan Year begins under section 230 of the Social Security Act.

401(k) Contribution Account.  The "401(k) Contribution Account" is the account established pursuant to Section 4.1(a)(i).  Prior to the Restatement Date, this account was called the "before-tax contribution account."

401(k) Contributions.  "401(k) Contributions" means contributions made by Participants pursuant to Section 3.1.  Prior to the Restatement Date, these contributions were called "before-tax contributions."

Fund.  The "Fund" is the total of all of the assets of every kind and nature, both principal and income, held in the Trust at any particular time or, if the context so requires, one or more of the investment funds described in Section 5.1.

Highly Compensated Employee.

(a)       A "Highly Compensated Employee" for any Plan Year is any employee who:

(i)              at any time during such Plan Year or the 12-month period preceding such Plan Year, owns or owned (or is considered as owning or having owned within the meaning of Code section 318) more than five percent of the outstanding stock of an Affiliated Organization or stock possessing more than five percent of the total combined voting power of all outstanding stock of an Affiliated Organization; or (ii)            during the 12-month period preceding such Plan Year, received compensation in excess of $80,000 (or such dollar amount, adjusted to reflect increases in the cost of living, as in effect under Code section 414(q)(1)(B) for the calendar year during which the Plan Year in question begins).

(b)       For purposes of this section:

(i)        an "employee" is any individual (other than an individual who is a nonresident alien who receives no earned income (within the meaning of Code section 911(d)(2)) from an Affiliated Organization that constitutes income from sources within the United States (within the meaning of Code section 861(a)(3))) who, during the Plan Year for which the determination is being made, performs services for an Affiliated Organization as

(1)            a common-law employee, (2)            an employee pursuant to Code section 401(c)(1) or (3)            a Leased Employee; and

(ii)       "compensation" for any period means an employee's Section 415 Wages for the period. 

(iii)      A former employee of an Affiliated Organization shall be treated as a former Highly Compensated Employee of the Affiliated Organization if the former employee was a Highly Compensated Employee of the Affiliated Organization when the former employee incurred a Termination of Employment or the former employee was a Highly Compensated Employee of the Affiliated Organization at any time after attaining age 55.  The determination of who is a former Highly Compensated Employee is based on the rules applicable to determining Highly Compensated Employee status as in effect for that determination year in accordance with Section 1.414(q)-1T, Q&A-4 of the Temporary Income Tax Regulations and Notice 97-45 or later guidance under the Code.

Hour of Active Service.  An "Hour of Active Service" is an hour for which the Employee is paid, or entitled to payment, for the performance of duties for an Affiliated Organization.

Hour of Service. An "Hour of Service" shall have the meaning assigned to it in Section 10.5.

Leased Employee.  A "Leased Employee" is any individual (other than an Employee) who provides services for an Affiliated Organization (or for an Affiliated Organization and "related persons" within the meaning of Code section 144(a)(3)):

(a)       pursuant to an agreement between an Affiliated Organization and any other person;

(b)       under the Affiliated Organization's primary direction and control; and

(c)       on a substantially full-time basis for a period of at least one year.

Matching Contribution Account.  The "Matching Contribution Account" is the account established pursuant to Section 4.1(a)(iii).

Matching Contributions.  "Matching Contributions" means contributions made by the Participating Employers on behalf of Participants pursuant to Section 3.3 or 3.6.

Normal Retirement Date.  The "Normal Retirement Date" of a Participant is the date on which he or she attains age 65.

One-Year Break in Service.  "One-Year Break in Service" is defined in Section 10.2.

Participant.  A "Participant" is a current or former Qualified Employee who has entered the Plan pursuant to the provisions of Article 2 and who has not ceased to be a Participant pursuant to the provisions of Section 2.8.

Participating Business Unit.  A "Participating Business Unit" is a division, work location or other operational unit of a Participating Employer, the eligible employees of which have been designated by the Participating Employer to participate in the Plan, as communicated in writing to the Company by the Participating Employer's Board.

Participating Employer.  A "Participating Employer" is the Company and any other Affiliated Organization that has adopted the Plan, or all of them collectively, as the context requires, and their respective successors.  An Affiliated Organization will cease to be a Participating Employer upon a termination of the Plan as to its Qualified Employees or upon its ceasing to be an Affiliated Organization.

Plan.  The "Plan" is that set forth in this instrument as it may be amended from time to time.  

Plan Rule.  A "Plan Rule" is a rule, policy, practice or procedure adopted by the Administrator. 

Plan Year.  A "Plan Year" is the 12-month period beginning on each January 1 and ending on the first following December 31.

Profit Sharing Contribution Account.  The "Profit Sharing Contribution Account" is the account established pursuant to Section 4.1(a)(iv).

Profit Sharing Contributions.  "Profit Sharing Contributions" means contributions made by the Participating Employers on behalf of Participants pursuant to Section 3.4 or 3.6.

Profit Sharing Plan Rollover Account.  The "Profit Sharing Plan Rollover Account" is the account established pursuant to Section 4.1(a)(vi).

Qualified Employee.  

(a)       Except as provided in Subsection (b), a "Qualified Employee" is an Employee who

(i)        performs services for a Participating Business Unit as an employee of a Participating Employer (as classified by the Participating Employer at the time the services are performed without regard to any subsequent reclassification); or

(ii)       is paid by a Participating Employer on a United States payroll while on a temporary foreign assignment as an employee of P.T. Vision-Ease Asia.

(b)       An Employee who would otherwise be a Qualified Employee is not a Qualified Employee if he or she:

(i)        is a nonresident alien who receives no earned income (within the meaning of Code section 911(d)(2) from a Participating Employer that constitutes income from sources within the United States (within the meaning of Code section 861(a)(3)); or

(ii)       is covered by a collective bargaining agreement, for whom retirement benefits were the subject of good faith bargaining between such person's representative and a Participating Employer, and is not, as a result of such bargaining, specifically covered by this Plan; or

(iii)      is working in the United States on a temporary foreign assignment; or

(iv)      is a Leased Employee.

(c)       An individual who is classified by a Participating Employer as an independent contractor, Leased Employee or as any other status in which the individual is not classified by the Participating Employer as a common-law employee of the Participating Employer at the time services are performed is not a Qualified Employee.  No judicial or administrative reclassification, or reclassification by the Participating Employer, will be applied to grant retroactive eligibility to any individual under the Plan.

Restatement Date.  The "Restatement Date" of the Plan is January 1, 2001, or such earlier date as specified in the Addendum.

Rollover Account.  The "Rollover Account" is the account established pursuant to Section 4.1(a)(v).

Section 415 Wages. 

(a)       An individual's "Section 415 Wages" for any period is his or her "compensation," within the meaning of Code section 415(c)(3) and Treasury Regulations thereunder, for the period from all Affiliated Organizations.

(b)       The Administrator may, for any period, determine the items of remuneration that, in accordance with Treasury Regulations, will be included in Section 415 Wages for such period; provided that for each purpose under this Plan, the Administrator's determination will be uniform throughout any period.

(c)       An individual's "Section 415 Wages" for any period shall include elective contribution pursuant to a qualified cash or deferred arrangement, otherwise payable to the individual by an Affiliated Organization, and other amount that are not includible in the individual's gross income by reason of Code section 125, 132(f)(4) or 457.

Termination of Employment.

(a)       For purposes of the Plan, a Participant will be deemed to have terminated employment only if he or she has completely severed his or her employment relationship with all Affiliated Organizations or become Disabled.  Neither transfer of employment among Affiliated Organizations nor absence from active service by reason of disability leave, other than in connection with a Participant becoming Disabled, or any other leave of absence will constitute a Termination of Employment.

(b)       A Participant will be deemed to have terminated employment in conjunction with the disposition of all or any portion of the business operation of an Affiliated Organization which is a disposition of a subsidiary or of substantially all of the assets used in a trade or business of an Affiliated Organization within the meaning of Code section 401(k)(10)(A) with respect to which the requirements of Code section 401(k)(10)(B) and (C) are satisfied.

(c)       A Participant who, in conjunction with the disposition of all or any portion of a business operation of an Affiliated Organization which is not described in Subsection (b), transfers employment to the acquirer of such business operation or to any affiliate of such acquirer will not be considered to have terminated employment.  If a Participant is deemed to have continued employment by reason of the preceding sentence, such sentence will continue to apply to such Participant in the event of any subsequent transfer of employment in conjunction with the disposition of all or any portion of a business operation of the initial acquirer or any subsequent acquirers which is not a disposition of a subsidiary of such acquirer or of substantially all of the assets used in a trade or business of such acquirer within the meaning of Code section 401(k)(10)(A) with respect to which the requirements of Code section 401(k)(10)(B) and (C) are satisfied.  Except in conjunction with such a disposition of a subsidiary or substantially all of the assets used in a trade or business of the seller, such a Participant will be considered to have terminated employment only when he or she has severed the employment relationship with all such acquirers and their affiliates.

Testing Wages. 

(a)       An individual's "Testing Wages" for any Plan Year is his or her Section 415 Wages for the Plan Year.

(b)       Notwithstanding Subsection (a), in no event will a person's Testing Wages for any Plan Year be taken into account to the extent it exceeds $150,000 (or such other larger amount as may be permitted for the calendar year during which such Plan Year begins under Code section 401(a)(17)).

(c)       The Administrator may, for any Plan Year, adopt any alternative definition of Testing Wages that complies with Code section 414(s) and Treasury Regulations thereunder; provided, that for each purpose under this Plan, the definition so adopted will be uniform throughout any Plan Year.

Treasury Regulations.  "Treasury Regulations" mean regulations, rulings, notices and other promulgations issued under the authority of the Secretary of the Treasury that apply to, or may be relied upon in the administration of, this Plan.

Trust.  The "Trust" is that created for purposes of implementing benefits under the Plan.

Trustee.  The "Trustee" is the corporation and/or individual or individuals who from time to time is or are the duly appointed and acting trustee or trustees of the Trust.

Vesting Service.  "Vesting Service" is defined in Section 10.1.

 

BMC INDUSTRIES, INC.
SAVINGS AND PROFIT SHARING PLAN

2001 Revision

ADDENDUM

SPECIAL EFFECTIVE DATES

The following Plan provisions are effective prior to the Restatement Date:

Definitions

Effective on or after January 1, 2000, the definition of "Eligible Earnings" in Section 14.2 of the Plan shall include elective amounts that are not includible in the gross income of the Employee by reason of Code section 132(f)(4).

The definition of "Eligible Rollover Distribution" in Section 14.2 of the Plan is effective for Plan Years beginning on or after January 1, 1999.

The definition of "Highly Compensated Employee" in Section 14.2 of the Plan is effective for Plan Years beginning on or after January 1, 1997.

The definition of "Leased Employee" in Section 14.2 of the Plan is effective for Plan Years beginning on or after January 1, 1997.

The definition of "Section 415 Wages" in Section 14.2 of the Plan is generally effective for Plan Years beginning on and after January 1, 1998.  Effective for Plan Years beginning on and after January 1, 2001, the definition of "Section 415 Wages" shall include elective amounts that are not includable in the gross income of the Employee by reason of Code section 132(f)(4).

ADP/ACP Testing

The actual deferral percentage test under Section 9.2(a)(i) and the actual contribution percentage test under Section 9.3(a)(i). were applied using the prior year testing methodfor the following Plan Years:  1999 and 2000. 

Sections 9.2(d) and 9.3(c) of the Plan regarding return of excess elective contributions and excess matching contributions are effective as of January 1, 1997.

Sections 9.2(f) and 9.3(e) of the Plan regarding the nondiscrimination early participation rule is effective as of January 1, 1999. 

Distributions

Effective on and after September 1, 1998, the "required beginning date" and timing of distribution election discussed in Section 8.1 of the Plan was changed for non-5-percent owners to April 1 following the later of (i) the year in which the Employee attains age 701/2 and (ii) the year in which the Employee incurs a Termination of Employment.

As of October 17, 2000, the cash-out limit in Section 8.1(a)(i) of the Plan shall be applied as of the date on which the distribution is made, regardless of the prior balance of the Participant's Account.

Highly Compensated Employees Determinations

Look Back Year Elections.  Prior to the Restatement Date, the Plan was administered in accordance with the following look back year election:

12-consecutive month period immediately preceding the Plan Year for the 1997, 1998, 1999 and 2000 Plan Years.

EX-10.3 4 exhibit_10-3.htm

BMC INDUSTRIES, INC.

SAVINGS AND PROFIT SHARING PLAN

2001 REVISION

First Declaration of Amendment

Pursuant to the retained power of amendment contained in Section 11.2 of the BMC Industries, Inc. Savings and Profit Sharing Plan - 2001 Revision, the undersigned hereby amends the Plan by adding a new Exhibit A thereto in the form attached hereto.

The foregoing amendment is effective as of December 31, 2001.

IN WITNESS WHEREOF, the undersigned has caused this instrument to be executed this 26th day of December, 2001.

                                                                                    BMC INDUSTRIES, INC.

Attest:  /s/Jon A. Dobson                                            By:  /s/Bradley D. Carlson

            Secretary                                                         Its:  Treasurer

BMC INDUSTRIES, INC.

SAVINGS AND PROFIT SHARING PLAN

2001 REVISION

EXHIBIT A

Special Provisions Applicable to

Vision-Ease Lens Azusa, Inc. and Buckbee-Mears Cortland in 2001

Pursuant to Section 14.1(f), this Exhibit A sets forth special provisions of the Plan applicable only to an Active Participant in the Plan who is a Qualified Employee of Vision-Eae Lens Azusa, Inc. or Buckbee-Mears Cortland, a unit of BMC Industries, Inc. and classified by the Participating Employer as being on an unpaid leave of absence on December 31, 2001 (a "Vision-Ease Lens Azusa/Buckbee-Mears Cortland Participant").

1. Notwithstanding Section 3.3(a)(i), a Vision-Ease Lens Azusa/Buckbee-Mears Cortland Participant will be eligible to share in the Participating Employer's Matching Contribution for the calendar quarter ending on December 31, 2001 pursuant to the provisions set forth in Section 3.3(a).
   
   

2. Notwithstanding Section 3.3(b)(i), a Vision-Ease Lens Azusa/Buckbee-Mears Cortland Participant, will be eligible to share in the Participating Employer's Matching Contribution (if any) for the Plan Year ending on December 31, 2001 pursuant to the provisions set forth in Section 3.3(b).
   
   

3. Notwithstanding Section 3.4(b)(i), a Vision-Ease Lens Azusa/Buckbee-Mears Cortland Participant who completed at least 1000 Hours of Service during the Plan Year ending on December 31, 2001, will be eligible to share in the Participating Employer's Profit Sharing Contribution for the Plan Year ending on December 31, 2001 pursuant to the provisions set forth in Section 3.4(b).

EX-10.4 5 exhibit_10-4.htm

BMC INDUSTRIES, INC.

SAVINGS AND PROFIT SHARING PLAN

2001 revision

Second Declaration of Amendment

Pursuant to the retained power of amendment contained in Section 11.2 of the BMC Industries, Inc. Savings and Profit Sharing Plan - 2001 Revision, the undersigned hereby amends the Plan as described below:

1.               Section 3.3 of the Plan is amended effective January 1, 2002, to read as follows:

"3.3     Matching Contributions. 

(a)       Subject to Subsections (b) and (d) and the limitations described in Article 9, the Participating Employer of an eligible Active Participant will make a Matching Contribution on behalf of the Active Participant for a calendar quarter in an amount equal to:

(i)        100 percent of the amount of the Active Participant's 401(k) Contributions for each calendar quarter up to three percent of the Participant's Eligible Earnings for such calendar quarter, and

(ii)       50 percent of the amount of the Active Participant's 401(k) Contributions for each calendar quarter that exceeds three percent of the Active Participant's Eligible Earnings for such calendar quarter and that does not exceed five percent of the Active Participant's Eligible Earnings for such calendar quarter.

It is intended that such Matching Contributions will be used by the Participating Employer to satisfy the safe harbor provisions of Code sections 401(k)(12) and 401(m)(11).

(b)       To be eligible to share in the Participating Employer's Matching Contribution for a given calendar quarter, a Participant must have, on or before the last day of the calendar quarter, entered the Plan as a Participant for the purposes of having Matching Contributions made on his or her behalf, received Eligible Earnings for the calendar quarter from the Participating Employer and made 401(k) Contributions.

(c)       A Participating Employer's Matching Contributions for a Plan Year will be paid to the Trustee on such date or dates during or following such Plan Year as the Participating Employer may elect but in no case more than 12 months after the end of the Plan Year.  A Participating Employer's Matching Contributions for a calendar quarter that are used to satisfy the safe harbor provisions of Code sections 401(k)(12) and 401(m)(11) will be paid to the Trustee no later than the last day of the following calendar quarter.

(d)       No Matching Contribution will be made with respect to any portion of a Participant's 401(k) Contributions returned to the Participant pursuant to Article 9.  For this purpose, 401(k) Contributions with respect to which no Matching Contributions are made for a Plan Year will be deemed to be the first such contributions returned to the Participant.  If the Administrator determines that Matching Contributions that have been added to a Participant's Account should not have been added by reason of this subsection, the contributions, increased by Fund earnings or decreased by Fund losses attributable to the contributions, as determined under Section 9.5, will be subtracted from the Account as soon as administratively practicable after the determination is made and will be applied to satisfy the contribution obligations of the Participating Employer that made the excess contributions for the Plan Year for which the excess contributions were made.  If, because of the passage of time, the excess cannot be applied in this way, the excess will be allocated, in the discretion of the Administrator:

(i)        among the Matching Contribution Accounts of all Participants who made 401(k) Contributions for the Plan Year as Qualified Employees of the Participating Employer in proportion to such 401(k) Contributions up to six percent of Eligible Earnings; or

(ii)       as a corrective contribution pursuant to Section 3.6.

(e)       Notwithstanding any other provision of this section to the contrary, a Participant covered by a collective bargaining agreement between his or her bargaining representative and a Participating Employer is eligible for Matching Contributions only if and to the extent provided in the collective bargaining agreement.

(f)        No Matching Contributions will be made with respect to After-Tax Contributions."

2.               Section 3.4(a) of the Plan is amended effective January 1, 2002, to read as follows:

"(a)      Each Participating Employer may make a Profit Sharing Contribution for a Plan Year on behalf of a Participant who has satisfied the eligibility conditions specified in Subsection (b) for a Plan Year in an amount (if any) equal to the sum of:

(i)        a percentage (if any) determined by the Participating Employer's Board for the Plan Year of the aggregate Eligible Earnings for the Plan Year of all Participants eligible to share in the contribution for the Plan Year plus

(ii)       an additional amount, if any, separately determined by the Participating Employer's Board for each of its Participating Business Units based on the annual profit performance of each Participating Business Unit."

3.               Section 3.4(c) of the Plan is amended effective January 1, 2002, to read as follows:

"(c)      Subject to the limitations described in Article 9, a Participating Employer's Profit Sharing Contribution for a Plan Year will be allocated among the Profit Sharing Contribution Accounts of Participants who have satisfied the eligibility conditions under Subsection (b) for the Plan Year as follows:

(i)        The Participating Employer's contribution described in Subsection (a)(i) will be allocated to each eligible Participant as follows:

(1)       a dollar amount equal to 5.7% of the sum of each Participant's Eligible Earnings plus his or her Excess Eligible Earnings; or

(2)       if the Employer contribution is less than the amount in Clause (1) above, then each eligible Participant will be allocated a share of the Participating Employer's Profit Sharing Contribution in the same proportion that the sum of such Participant's Eligible Earnings plus his or her Excess Eligible Earnings for the Plan Year bears to the sum of the Eligible Earnings plus Excess Eligible Earnings of all such eligible Participants; or

(3)       any remaining contribution will be allocated among eligible Participants in the same proportion that each Participant's Eligible Earnings for the Plan Year bears to the total amount of all eligible Participants' Eligible Earnings for that Plan Year.

(ii)       The Participating Employer's contribution described in Subsection (a)(ii) with respect to a given Participating Business Unit will be allocated to each eligible Participant who received Eligible Earnings for the Plan Year with respect to services for the Participating Business Unit (other than administrative services with respect to which he or she is included in the Corporate Participating Business Unit unless the contribution relates to the Corporate Participating Business Unit) in the same manner as under Subsection (c)(i) provided the allocations under this Subsection (c)(ii) are determined after aggregating the contributions allocated under (c)(i) to those participants who are eligible to receive an allocation under this Subsection (c)(ii) and the contributions to be allocated hereunder."

4.               Section 4.1(a)(iii) of the Plan is amended effective January 1, 2002, to read as follows:

"(iii)    A Matching Contribution Account, which will include the balance of his or her employer contribution account under prior provisions of the Plan and to which there will be added any Matching Contributions made on the Participant's behalf, together with a subaccount established and maintained for a Participant in connection with any Matching Contributions made pursuant to Section 3.3(a) that are used to satisfy the designed-based safe harbor alternative described in Code section 401(k)(12) and/or the designed-based safe harbor alternative described in Code section 401(m)(11), as provided under Sections 9.2, 9.3, and 9.4;"

5.               Section 5.1 of the Plan is amended effective February 1, 2002, to read as follows:

"5.1     Establishment of Investment Funds.

(a)       In order to allow each Participant to determine the manner in which his or her Accounts will be invested, the Trustee will maintain, within the Trust, an investment fund designated as the BMC Common Stock Fund and three or more separate investment funds of such nature and possessing such characteristics as the Committee may specify from time to time.  Subject to Section 5.4(b), each Participant's Accounts will be invested in the investment funds in the proportions directed by the Participant in accordance with the procedures set forth in Sections 5.2 and 5.3.  The Committee may, from time to time, direct the Trustee to establish additional investment funds or to terminate any existing investment fund.

(b)       Notwithstanding any other provision of the Plan to the contrary, the Committee may direct the Trustee to suspend Participant investment activity (including such activity in connection with the withdrawals, loans and distributions) in any or all investment funds, or impose special rules or restrictions of uniform application, for a period determined by the Committee to be necessary in connection with:

(i)        the establishment or termination of any investment fund;

(ii)       the receipt by the Trustee from, or transfer by the Trustee to, another trust of account balances in connection with an acquisition or divestiture or otherwise;

(iii)      a change of Trustee, investment manager or recordkeeper; or

(iv)      such other circumstances determined by the Committee as making such suspension or special rules or restrictions necessary or appropriate."

6.               Section 5.4 of the Plan is amended effective February 1, 2002, to read as follows:

"5.4     BMC Common Stock Fund.

(a)       The Trustee will establish, as one of the investment funds under Section 5.1, a fund, designated as the BMC Common Stock Fund, which will be invested in shares of Company Stock except for such amounts of cash as the Committee determines to be necessary to satisfy short-term liquidity requirements and cash held pending acquisition of shares of Company Stock.

(b)       Subject to Subsection (c), all amounts credited to a Participant's Matching Contribution Account prior to January 1, 2002 will be invested only in the BMC Common Stock Fund.

(c)       Notwithstanding Subsection (b) -

(i)        Not more than once each calendar quarter, a Participant who has attained age 55 may elect to transfer all or any portion of his or her Matching Contribution Account from the BMC Common Stock Fund to one or more of the investment funds maintained pursuant to Section 5.1 other than the BMC Common Stock Fund.  The election must be made in accordance with and is subject to Plan Rules and will be effective as soon as administratively practicable after it is received by the Administrator or the Administrator's designate.

(ii)       Not more than once each calendar quarter, a Participant who is an Employee and is not eligible to make directions pursuant to Subsection (c)(i) may elect to transfer up to 25 percent of his or her Matching Contribution Account from the BMC Common Stock Fund to one or more of the investment funds maintained pursuant to Section 5.1 other than the BMC Common Stock Fund.  A Participant may only make an election pursuant to this Subsection (c)(ii) if the portion of the  Participant's Matching Contribution Account, excluding the Matching Contribution subaccount established pursuant to Section 4.1(a)(iii),invested in the BMC Common Stock Fund equals or exceeds 20 percent of the aggregate balance of the Participant's 401(k) Contribution Account, Matching Contribution Account, After-Tax Contribution Account and Rollover Account.  The election must be made in accordance with and is subject to Plan Rules and will be effective as soon as administratively practicable after it is received by the Administrator or the Administrator's designate.

(d)       The BMC Qualified Benefits Plan Committee will direct the manner in which the shares of Company Stock represented by Participants' interests in the BMC Common Stock Fund will be voted in connection with any action at which holders of Company Stock are entitled to vote.  In the event of a public tender or exchange offer for shares of Company Stock, the BMC Qualified Benefits Plan Committee will direct whether or not the shares of Company Stock represented by the Participants' interests in the BMC Common Stock Fund will be tendered or exchanged.

(e)       A Participant who is subject to the reporting requirements of section 16 of the Securities Exchange Act of 1934 (the "Exchange Act") with respect to Company Stock may elect to make a transfer pursuant to Section 5.3, a withdrawal or plan loan pursuant to Article 6, a distribution pursuant to Article 8or any other "discretionary transaction," as that term is defined under the Exchange Act, from the portion of his or her Account invested in Company Stock only if both of the following conditions are satisfied.

(i)        The election to make such transfer or application for the withdrawal or distribution must be made within the period between the third and twelfth days, inclusive, following the Company's release of its quarterly or annual financial data in the manner described in Rule 16b-3(e)(1)(ii) of the Exchange Act.  Such election or application will be given effect at the same time as would other elections or applications made at the same time.

(ii)       Such Participant has not made any election to transfer any portion of his or her Account balance from Company Stock or received a withdrawal or distribution from the portion of his or her Account invested in Company Stock within the six-month period immediately preceding the date on which such election is made."

7.               Section 7.1 of the Plan is amended effective January 1, 2002, to read as follows:

"7.1     Vesting. 

(a)       A Participant always has a fully vested nonforfeitable interest in his or her 401(k) Contribution Account, After-Tax Contribution Account, Matching Contribution Account, Rollover Account, Profit Sharing Plan Rollover Account and in the portion of his or her Profit Sharing Contribution Account credited to a subaccount described in Section 3.6.

(b)       A Participant will acquire a fully vested nonforfeitable interest in the portion of his or her Profit Sharing Contribution Account not described in Subsection (a) upon attaining his or her Normal Retirement Date while he or she is, or before he or she became, an Employee.

(c)       A Participant will acquire a fully vested nonforfeitable interest in the portion of his Profit Sharing Contribution Account not described in Subsection (a) if he or she dies or becomes Disabled while he or she is an Employee.

(d)       A Participant will acquire a fully vested nonforfeitable interest in the portion of his or her Profit Sharing Account not described in Subsection (a) upon the Participant's Termination of Employment following the Participant's attainment of age 60 if the sum of his or her age and full years of Vesting Service is at least 65.

(e)       A Participant will acquire a fully vested nonforfeitable interest in the portion of his or her Profit Sharing Contribution Account not described in Subsection (a) if the Affiliated Organization, Participating Business Unit, business unit, location or division at which the Participant is employed, permanently ceases operations or is sold or otherwise transferred through sale of stock or of business and assets, in such manner that it no longer is, or is no longer owned by, an Affiliated Organization.

(f)        A Participant will acquire a fully vested nonforfeitable interest in the portion of his or her Profit Sharing Contribution Account not described in Subsection (a) upon a Change in Control with respect to the Company, which for purposes of this subsection means any of the following:

(i)        The sale, lease, exchange, or other transfer of all or substantially all of the assets of the Company, in one transaction or in a series of related transactions, to any Person;

(ii)       The approval by the stock holders of the Company of any plan or proposal for the liquidation or dissolution of the Company;

(iii)      Any Person is or becomes the "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of 50 percent or more of the combined voting power of the Company's outstanding securities ordinarily having the right to vote at elections of directors;

(iv)      Individuals who constitute the Company's Board of Directors on January 1, 1998 (the "Incumbent Board") cease for any reason to constitute at least a majority thereof, provided that any person becoming a director subsequent to January 1, 1998 whose election, or nomination for election, by the Company's stockholders, was approved by a vote of at least a majority of the directors comprising the Incumbent Board (either by a specific vote or by approval of the proxy statement of the Company in which such person is named as a nominee for director, without objection to such nomination) will, for purposes of this clause (iv), be deemed to be a member of the Incumbent Board; or

(v)       A change in control of a nature that is determined by independent legal counsel to the Company to be required to be reported (assuming such event has not been "previously reported") in response to Item 1(a) of the Current Report on Form 8-K, as in effect on January 1, 1994, pursuant to section 13 or 15(d) of the Exchange Act, whether or not the Company is then subject to such reporting requirement.

For purposes of applying the foregoing, the term "Person" means and includes any individual, corporation, partnership, group, association or other "person," as such term is used in section 14(d) of the Exchange Act, other than the Company, a wholly-owned subsidiary of the Company or any employee benefit plan(s) sponsored by the Company or a wholly-owned subsidiary of the Company.

(g)       A Participant whose Profit Sharing Contribution Account is not otherwise fully vested will acquire a vested nonforfeitable interest in the portion of his or her Profit Sharing Contribution Account not described in Subsection (a) to the extent provided in the following schedule:

Full Years of Vesting Service   Less than Five Years
Five or More Years Vested
Interest

  0%
100 %"

8.               Section 7.2 of the Plan is amended effective January 1, 2002, to read as follows:

"7.2     Forfeiture Upon Distribution.

(a)       If a Participant receives a distribution of the entire vested balance of his or her Accounts after Termination of Employment and before he or she incurs five consecutive One-Year Breaks in Service, the nonvested portions of the Participant's Profit Sharing Contribution Account will, at the time of such distribution, be forfeited.  A Participant who has no vested interest in his or her Profit Sharing Contribution Account when he or she terminates employment will be deemed to have received a distribution of the entire vested balance of the Account at the time of his or her Termination of Employment.

(b)       If a Participant described in Subsection (a) received a distribution of less than the entire balance of his or her Accounts, resumes employment as a Qualified Employee and repays to the Trustee the full amount distributed, other than the portion of the distribution attributable to his or her After-Tax Contribution Account, Rollover Account and Profit Sharing Plan Rollover Account balances, before the earlier of (1) five years following the date of reemployment as a Qualified Employee or (2) the date on which he or she incurs five consecutive One-Year Breaks in Service following the distribution, then, the amount of any forfeitures will be restored to the Participant's Profit Sharing Contribution Account, unadjusted for interest or any change in value occurring after the distribution.  Such restoration will be made from forfeitures that arise for the Plan Year for which such restoration is to be made.  To the extent such forfeitures are insufficient for such purpose, the Participating Employer with whom the Participant was last employed as a Qualified Employee will contribute the amount required to restore the Account.  A Participant described in the last sentence of Subsection (a) who is reemployed before incurring five consecutive One-Year Breaks in Service following the date of his or her Termination of Employment will be deemed to have repaid his or her deemed distribution upon his or her reemployment as a Qualified Employee."

9.               Section 7.3 of the Plan is amended effective January 1, 2002, to read as follows:

"7.3     Other Forfeitures.

(a)       Except as provided in Section 7.2, the nonvested portions of a Participant's Profit Sharing Contribution Account will continue to be held in a separate subaccount of such Account until the Participant incurs five consecutive One-Year Breaks in Service, at which time the subaccount balance will be forfeited.  If the Participant resumes employment with an Affiliated Organization prior to incurring five consecutive One-Year Breaks in Service, such subaccount will be disregarded and its balance will be included in the Profit Sharing Contribution Account.

(b)       A Participant's vested interest in his or her Profit Sharing Contribution Account balance following a resumption of employment in accordance with Subsection (a) at any given time will not be less than the amount "X" determined by the formula: X = P(AB + (R x D)) - (R x D), where P is the Participant's vested percentage at the time of determination; AB is the Account balance at the time of determination; D is the amount of the distribution; and R is the ratio of the Account balance at the time of determination, to the subaccount balance immediately following the distribution."

10.            Section 8.1(a)(v) of the Plan is amended effective February 1, 2002, to read as follows:

"(v)      All distributions will be made in the form of a check drawn on the Trust and, if applicable, a canceled note evidencing any Plan loan; provided, that if the vested portion of the Account balance of a Participant or Beneficiary of a deceased Participant is credited with the equivalent of at least 10 full shares of Company Stock, at the election of the Participant or Beneficiary, distribution of the vested portion of the Account balance invested in the BMC Common Stock Fund may be distributed in full shares of Company Stock and cash in lieu of any fractional share."

11.            Section 9.2(a) of the Plan is amended effective January 1, 2002, to read as follows:

"(a)      For each Plan Year that the designed-based safe harbor alternative described in Code section 401(k)(12) has not been satisfied, the Plan must satisfy the requirements of Code section 401(k)(3)."

12.            Section 9.2 of the Plan is amended effective January 1, 2002, by adding a new Subsection (g) that reads as follows:

"(g)      It is intended that the Plan will satisfy the design-based safe harbor alternative described in Code section 401(k)(12) to satisfy the Code section 401(k) nondiscrimination test."

13.            Section 9.3(a) of the Plan is amended effective January 1, 2002, to read as follows:

"(a)      For each Plan Year that the designed-based safe harbor alternative described in Code section 401(m)(11) has not been satisfied, the Plan must satisfy the requirements of Code section 401(m)(2)."

14.            Section 9.3 of the Plan is amended effective January 1, 2002, by adding a new Subsection (g) that reads as follows:

"(g)      It is intended that the Plan will satisfy the design-based safe harbor alternative described in Code section 401(m)(11) to satisfy the Code section 401(m) nondiscrimination test.  Notwithstanding the foregoing, After-Tax Contributions made by Participants will satisfy the nondiscrimination tests described in Section 9.3(a)."

IN WITNESS WHEREOF, the undersigned has caused this instrument to be executed this 26th day of December, 2001.

                                                                                    BMC INDUSTRIES, INC.

Attest:/s/Jon A. Dobson                                                By:  /s/Bradley D. Carlson

            Secretary                                                          Its: Treasurer

EX-10.5 6 exhibit_10-5.htm

BMC INDUSTRIES, INC.

SAVINGS AND PROFIT SHARING PLAN

2001 REVISION

Third Declaration of Amendment

Pursuant to the retained power of amendment contained in Section 11.2 of the BMC Industries, Inc. Savings and Profit Sharing Plan - 2001 Revision, the Plan is amended in the manner set forth below to reflect certain provisions of the Economic Growth and Tax Relief Reconciliation Act of 2001 ("EGTRRA").  This amendment is intended as good faith compliance with the requirements of EGTRRA and is to be construed in accordance with EGTRRA and Treasury Regulations.  Except as this amendment provides otherwise, this amendment will be effective as of January 1, 2002.  This amendment will supersede the provisions of the Plan to the extent those provisions are inconsistent with the provisions of this amendment.

1)     Effective for limitation years beginning after December 31, 2001, the aggregate annual additions that may be contributed or allocated to a Participant's account under the Plan for any Plan Year will not exceed the lesser of:

(a)   $40,000, as adjusted for increases in the cost-of-living under Code section 415(d), or

(b)  100 percent of the Participant's Section 415 Wages for the Plan Year.  The compensation limit referred to in this clause (b) will not apply to any contribution for medical benefits after separation from service (within the meaning of Code sections 401(h) or 419A(f)(2)) that is otherwise treated as an annual addition.

2)     The Eligible earnings and Testing Wages of a Participant taken into account for any Plan Year beginning after December 31, 2001, will not exceed $200,000, as adjusted for cost-of-living increases in accordance with Code section 401(a)(17)(B).  The cost-of-living adjustment in effect for a calendar year applies to Eligible Earnings and Testing Wages for the determination period that begins with or within such calendar year.

3)     The term "key employee" means any employee or former employee (including any deceased employee) who, at any time during the Plan Year that includes the determination date, was an officer of an Affiliated Organization having annual compensation greater than $130,000 (as adjusted under Code section 416(i)(1) for Plan Years beginning after December 31, 2002), a 5-percent owner of the Affiliated Organization, or a 1-percent owner of the Affiliated Organization having annual compensation of more than $150,000.  For this purpose annual compensation means compensation within the meaning of Code section 415(c)(3).  The determination of key employees will be made in accordance with Code section 416(i)(1) of the Code and Treasury Regulations.

4)     In determining if the Plan is a top-heavy plan, the present values of accrued benefits and the amounts of account balances of an employee as of the determination date will be increased by the distributions made with respect to the employee under the Plan and any plan aggregated with the Plan under Code section 416(g)(2) during the 1-year period ending on the determination date.  The preceding sentence will also apply to distributions under a termination plan which, had it not been terminated, would have been aggregated with the Plan under Code section 416(g)(2)(A)(i).  If a distribution is made for a reason other than separation from service, death, or disability, this provision will be applied by substituting "5-year period" for "1-year period."  The accrued benefits and accounts of any individual who has not performed services for the Affiliated Organization during the 1-year period ending on the determination date will not be taken into account.

5)     If the Plan is a top-heavy plan, Matching Contributions will be taken into account for purposes of satisfying the minimum contribution requirements of Code section 416(c)(2) and the Plan.  The preceding sentence will apply with respect to Matching Contributions under the Plan or, if the Plan provides that the minimum contribution requirement will be met in another plan, such other plan.  Matching Contributions that are used to satisfy the minimum contribution requirements will be treated as matching contributions for purposes of the actual contribution percentage test and other requirements of Code section 401(m).

6)     Effective for distributions made after December 31, 2001, for purposes of the direct rollover provisions in Section 8.7, an eligible retirement plan will also mean an annuity contract described in Code section 403(b) and an eligible plan under Code section 457(b) that is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state and that agrees to separately account for amounts transferred into such plan from this Plan.  The definition of eligible retirement plan will also apply in the case of a distribution to a surviving spouse, or to a spouse or former spouse who is the alternate payee under a qualified domestic relation order, as defined in Code section 414(p).  No amount that is distributed on account of hardship will be an eligible rollover distribution, and the distribute may not elect to have any portion of such a distribution paid directly to an eligible retirement plan.

7)     A portion of a distribution will not fail to be an Eligible Rollover Distribution merely because the portion consists of After-Tax Contributions that are not includible in gross income.  However, such portion may be transferred only to an individual retirement account or annuity described in section 408(a) or (b) of the Code or to a qualified defined  contribution plan described in section 401(a) or 403(a) of the Code that agrees to separately account for amounts so transferred, including separately accounting for the portion of such distribution that is includible in gross income and the portion of such distribution that is not so includible.

8)     The plan will accept Rollover contributions of Eligible Rollover Distributions made after December 31, 2001, from:

(a)   a qualified plan described in Code section 401(a) or 403(a), excluding after-tax employee contributions;

(b)  an annuity contract described in Code section 403(b), excluding after-tax employee contributions; or

(c)   an eligible plan under Code section 457(b) that is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state.

9)     The Plan will not accept a participant rollover contribution of the portion of a distribution from an individual retirement account or annuity described in section 408(a) or 408(b) of the Code that is eligible to be rolled over and would otherwise be includible in gross income, other than such an account or annuity that is solely a conduit for distributions from a qualified retirement plan, excluding after-tax employee contributions.

10)For purposes of Section 8.1(a) (involuntary distribution of vested Accounts of $5,000 or less), the value of a Participant's no forfeitable Account balances will be determined without regard to that portion of the Account balances that is attributable to a Participant's Profit Sharing Plan Rollover Account and Rollover contributions (and earnings allocable thereto) within the meaning of sections 402(c), 403(a)(4), 403(b)(8), 408(d)(3)(A)(ii), and 457(e)(16) of the Code.

11)The multiple use test described in Treasury Regulation section 1.401(m)-2 and Section 9.4 will not apply.

12)The top-heavy requirements of Code section 416 and Section 13.3 will not apply in any year beginning after December 31, 2001, in which the Plan consists solely of a cash or deferred arrangement which meets the design-based safe harbor alternative requirements of Code section 401(k)(12) and Matching Contributions with respect to which the design-based safe harbor alternative requirements of Code section 401(m)(11) are met.

13)A Participant who receives a hardship withdrawal of 401(k) Contributions after December 31, 2001, will be prohibited from making 401(k) Contributions and After-Tax Contributions under this Plan and elective deferrals and after-tax employee contributions under any other plans maintained by any Affiliated Organization for 6 months after receipt of the hardship withdrawal.

14)A Participant's vested Account balances will become distributable following the Participant's severance from employment with all Affiliated Organizations.  Such a distribution will be subject to the other provisions of the Plan regarding distributions, other than provisions that require a separation from service before such amounts may be distributed.

IN WITNESS WHEREOF, the undersigned has caused this instrument to be executed this 31^st day of December, 2002.

                                                                                    BMC INDUSTRIES, INC.

Attest:  /s/Jon A. Dobson                                            by:  /s/Susan Linzmeier

            Secretary                                                         its: V.P. Human Resources

EX-10.26 7 exhibit_10-26.htm

BMC Buckbee-Mears St. Paul

A unit of BMC Industries, Inc.

278 East 7^th Street

St. Paul, MN 55101

(651) 228-6400 / (800)BMC-Etch

Fax (651) 228-6541

January 14, 2003

Mr. Henry Zaidan

President

GMT Corporation

245 E. Sixth Street

St. Paul, MN  55101-1918

Dear Henry,

Please accept this letter as official notice that Buckbee-Mears will terminate the lease for the PS-3 space on February 28, 2003.

Please contact me if you have any questions.

Sincerely,

/s/Dennis Malecek

Dennis Malacek

Director of Operations

651-228-6471

EX-10.47 8 exhibit_10-47.htm

THE SEVENTH RESTATED

GRAPHIC COMMUNICATIONS INTERNATIONAL UNION,

TWIN CITIES LOCAL 6A -

BUCKBEE-MEARS PENSION PLAN

Generally Effective January 1, 2001

TABLE OF CONTENTS

 NAME AND HISTORY OF PLAN........................................................................................... 1

    Section 1.1.................................................................................................................................. 1

ARTICLE II.................................................................................................................................... 1

    DEFINITIONS........................................................................................................................... 1

    Section 2.1.................................................................................................................................. 1

    Section 2.2 - Accrual Service...................................................................................................... 1

    Section 2.3 - Accrued Benefit...................................................................................................... 3

    Section 2.4 - Actuarial Equivalent................................................................................................ 4

    Section 2.5 - Actuary.................................................................................................................. 4

    Section 2.6 - Beneficiary.............................................................................................................. 4

    Section 2.7 - -  Break in Service.................................................................................................... 5

    Section 2.8 - Code...................................................................................................................... 5

    Section 2.9 - Collective Bargaining Agreement............................................................................. 5

    Section 2.10 - Company.............................................................................................................. 6

    Section 2.11 - Computation Periods............................................................................................ 6

    Section 2.12 - Effective Date....................................................................................................... 6

    Section 2.13 - Eligibility and Vesting Service................................................................................ 6

    Section 2.14 - Eligible Employee.................................................................................................. 7

    Section 2.15 - Employer.............................................................................................................. 8

    Section 2.16 - Employment Commencement Date........................................................................ 8

    Section 2.17 - ERISA................................................................................................................. 8

    Section 2.18 - Fiduciary.............................................................................................................. 8

    Section 2.19 - -  Former Plan......................................................................................................... 8

    Section 2.20 - Hours Worked..................................................................................................... 8

    Section 2.21 - Normal Retirement Date....................................................................................... 8

    Section 2.22 - Normal Retirement Age...................................................................................... 11

    Section 2.23 - PBGC................................................................................................................ 11

    Section 2.24 - Participant.......................................................................................................... 11

    Section 2.25 - Plan.................................................................................................................... 11

    Section 2.26 - Plan Administrator.............................................................................................. 11

    Section 2.27 - Plan Anniversary Date......................................................................................... 11

    Section 2.28 - Plan Year........................................................................................................... 11

    Section 2.29 - Re-Employment Commencement Date................................................................ 11

    Section 2.30 - Retirement Fund................................................................................................. 12

    Section 2.31 - Termination of Employment................................................................................. 12

    Section 2.32 - Trustees.............................................................................................................. 12

    Section 2.33 - Union................................................................................................................. 12

    Section 2.34- Vesting................................................................................................................ 12

ARTICLE III................................................................................................................................ 12

    EMPLOYEE PARTICIPATION.............................................................................................. 12

    Section 3.1 - Eligibility for Participation...................................................................................... 12

    Section 3.2 - Transfer to Eligible Employee Status...................................................................... 13

    Section 3.3 - Re-Employment after a Break in Service............................................................... 13

    Section 3.4 - Preservation of Pre-Break Service........................................................................ 13

ARTICLE IV................................................................................................................................ 14

    BENEFITS............................................................................................................................... 14

    Section 4.1 - Normal Retirement Benefit Formula....................................................................... 14

    Section 4.2 - Accrued Benefit.................................................................................................... 14

    Section 4.3 - Early Retirement Benefit........................................................................................ 14

    Section 4.4 - Benefit Upon Other Termination of Employment.................................................... 15

    Section 4.5 - Early Commencement of Benefits.......................................................................... 15

    Section 4.6 - Minimum Benefit................................................................................................... 16

    Section 4.7 - Benefits that Matured Prior to the Effective Date.................................................... 16

    Section 4.8 - Non-Duplication of Benefits.................................................................................. 16

    Section 4.9 - Optional Forms of Benefit Payments...................................................................... 16

    Section 4.10 - Qualified Joint and Survivor Annuity.................................................................... 17

    Section 4.11 - Pre-Retirement Spouse Annuity........................................................................... 18

    Section 4.12 - Payment of Small Amounts.................................................................................. 20

    Section 4.13 - No Other Benefits............................................................................................... 21

    Section 4.14 - Maximum Benefits.............................................................................................. 21

    Section 4.15 - Death Benefit...................................................................................................... 21

    Section 4.16 - Manner of Election - Revocation for Joint and Survivor Annuity -

    Normal Retirement Age............................................................................................................. 22

ARTICLE V.................................................................................................................................. 23

    PLAN FINANCING................................................................................................................ 23

    Section 5.1 - Contributions........................................................................................................ 23

ARTICLE VI................................................................................................................................ 23

    ACTUARY............................................................................................................................... 23

    Section 6.1 - Appointment and Duties........................................................................................ 23

    Section 6.2 - Successors........................................................................................................... 24

ARTICLE VII............................................................................................................................... 24

    ADMINISTRATION............................................................................................................... 24

    Section 7.1 - Allocation of Responsibility Among Fiduciaries for Plan and Retirement

    Fund Administration................................................................................................................... 24

    Section 7.2 - Facility of Payment................................................................................................ 24

    Section 7.3 - Discretionary Authority......................................................................................... 25

ARTICLE VIII............................................................................................................................. 25

    MISCELLANEOUS................................................................................................................. 25

    Section 8.1 - Non-Guarantee of Employment............................................................................. 25

    Section 8.2 - Rights to Retirement Fund Assets.......................................................................... 25

    Section 8.3 - Non-Alienation of Benefits.................................................................................... 25

    Section 8.4 - Distributions Under Domestic Relations Orders..................................................... 26

ARTICLE IX................................................................................................................................ 26

    AMENDMENTS...................................................................................................................... 26

    Section 9.1 - Amendment.......................................................................................................... 26

ARTICLE X.................................................................................................................................. 27

    SUCCESSOR COMPANY AND MERGER OR CONSOLIDATION OF PLANS............... 27

    Section 10.1 - Successor Company........................................................................................... 27

    Section 10.2 - Plan Assets......................................................................................................... 27

ARTICLE XI................................................................................................................................ 28

    TOP HEAVY PROVISIONS................................................................................................... 28

    Section 11.1 - Top Heavy Plan Requirements............................................................................ 28

    Section 11.2 - Determination of Top Heavy Status..................................................................... 28

    Section 11.3 - Vesting if a Portion of the Plan Becomes Top Heavy............................................ 33

    Section 11.4 - Minimum Benefit Requirement If a Portion of the Plan Becomes Top Heavy......... 34

ARTICLE XII............................................................................................................................... 35

ARTICLE XIII............................................................................................................................. 36

    PLAN TERMINATION........................................................................................................... 36

    Section 13.1 - Right to Terminate............................................................................................... 36

    Section 13.2 - Partial Termination.............................................................................................. 37

    Section 13.3 - Liquidation of Retirement Fund............................................................................ 37

    Section 13.4 - Manner of Distribution........................................................................................ 39

    Section 13.5 - Residual Amounts............................................................................................... 40

ARTICLE XIV.............................................................................................................................. 40

    CONSTRUCTION.................................................................................................................. 40

    Section 14.1 - Construction....................................................................................................... 40

    Section 14.2 - Authority of Trustees.......................................................................................... 40

ARTICLE I

NAME AND HISTORY OF PLAN

    Section 1.1 - THE GRAPHIC COMMUNICATIONS INTERNATIONAL UNION, TWIN CITIES LOCAL 6A - BUCKBEE-MEARS PENSION PLAN (formerly known as the Pension Plan of the Lithographers and Photoengravers International Union, Twin Cities Local 6A - Buckbee Mears Retirement Fund and more recently known as the Graphic Arts International Union, Twin Cities Local 6A - Buckbee-Mears Pension Plan) as set forth in the instrument dated the 27^th day of December 1968, amended January 1, 1975, restated January 1, 1976, amended and restated January 1, 1982, amended and restated January 1, 1984, amended and restated January 1, 1985, amended and restated January 1, 1989, and is hereby amended and restated in its entirety to be effective as of January 1, 2001.

ARTICLE II

DEFINITIONS

    Section 2.1 - All of the definitions contained in the Restated Agreement and Declaration of Trust of the GRAPHIC COMMUNICATIONS INTERNATIONAL UNION, TWIN CITIES LOCAL 6A - BUCKBEE-MEARS RETIREMENT FUND, formerly the Graphic Arts International Union, Twin Cities Local 6A - Buckbee Mears Retirement Fund, are incorporated into this Plan by reference.

    Section 2.2 - Accrual Service  The Accrual Service credited to a Participant will vary in accordance with the particular year in which such service was performed and the year in which said Participant's employment terminated.  Computations of Accrual Service shall include all Hours Worked by an Eligible Employee in an Accrual Computation Period.

(a)      For Participants who are laid off or who terminate employment with the Employer after December 31, 1984, Accrual Service after December 31, 1975 is accumulated at the rate of one (1) year for each Accrual Computation Period in which an Eligible Employee completes 1,800 or more Hours Worked.  If an Eligible Employee works at least 900 hours but less than 1,800 hours, he will be entitled to a fraction of one (1) year Accrual Service based upon the number of hours actually worked divided by 1,800 hours.  There will be no accumulation of Accrual Service for any complete Accrual Computation Period in which a Participant accumulates less than 900 Hours Worked.

(b)      For Participants who are laid off or who terminate employment with the Employer between January 1, 1981 and December 31, 1984, Accrual Service after December 31, 1975 is accumulated at the rate of one (1) year for each Accrual Computation Period in which an Eligible Employee completes 1,800 or more hours worked.  There will be no accumulation of Accrual Service for any complete Accrual Computation Period in which a Participant accumulates less than 975 hours.  If a Participant accumulates more than 975 hours, but less than 1,800 hours, he will be entitled to a fraction of one (1) year of Accrual Service based upon the number of hours actually worked divided by 1,950 hours.

(c)      In the case of a Participant who is laid off or terminates employment with the Employer    during the period from January 1, 1976 through December 1, 1980, an Eligible Employee shall have accumulated at least 975 hours during the computation period in order to receive any Accrual Service for that period.  An Eligible Employee working at least 975 hours but less than 1,950 hours in an Accrual Computation Period between January 1, 1976 and December 31, 1980, shall accrue a fraction of one (1) year of Accrual Service, the numerator being the number of hours actually worked and the denominator being 1,950 hours.

(d)      Accrual Service prior to January 1, 1976 shall be the service recognized for benefit accrual purposes under the terms of the Former Plan.  For each Plan Year from June 1, 1968 to May 31, 1975, service was accumulated as follows:

•         1 year of Accrual Service if at least 48 weekly payroll checks received from the Employer in a Plan Year.

•         3/4 of 1 year of Accrual Service if between 36 and 47 weekly payroll checks received from the Employer in a Plan Year.

•         ½ of 1 year of Accrual Service if between 24 and 35 weekly payroll checks received from the Employer in a Plan Year.

•         No credit if less than 24 weekly payroll checks received from the Employer in a Plan year.

(e)      For the short Plan Year June 1, 1975 to December 31, 1975, service was accumulated as follows:

•         58.33% of 1 year of Accrual Service if at least 28 weekly payroll checks received from the Employer in the Plan Year.

•         43.75% of 1 year of Accrual Service if between 21 and 27 weekly payroll checks received from the Employer in the Plan Year.

•         29.17% of 1 year of Accrual Service if between 14 and 20 weekly payroll checks received from the Employer in the Plan Year.

•         No credit if less than 14 weekly payroll checks received from the Employer in the Plan Year.

(f)       A Participant who retires on or after January 1, 1973 is entitled to a maximum of ten (10) Years of Service under this Plan for vesting and accrual purposes for employment with the Employer within the ten (10) years prior to June 1, 1968 provided that such service would otherwise qualify under the terms of this Plan.  For purposes of determining Accrual Service, years prior to June 1, 1968, shall be calculated pursuant to Section 2.2(d).

(g)      Service prior to June 1, 1958, shall not be counted for the purpose of calculating Accrual Service under this Plan.

    Section 2.3 - Accrued Benefit.  The Accrued Benefit for each Participant who on or after January 1, 2003:

(a)      terminates employment with the Employer:

(b)      is laid off; or

(c)      ceases being an Eligible Employee;

shall be $43.50 multiplied by the number of years of Accrual Service through December 31, 2001; plus, Hours Worked from January 1, 2002 through June 30, 2002 divided by 1800 hours multiplied by $43.50; plus, Hours Worked from July 1, 2002 through December 31, 2002 divided by 1800 multiplied by $21.75; plus $21.75 multiplied by the number of years of Accrual Service on or after January 1, 2003.  No Hours Worked in 2002 in excess of 1800 hours shall be included in these equations.  Pursuant to Section 2.2, there will be no accumulation of Accrual Service for any complete Accrual Computation Period in which a Participant accumulates less than 900 Hours Worked; in addition, if any Eligible Employee has less than 900 Hours Worked in the year 2002, he or she shall not be entitled to any benefit accrual for 2002.

    With respect to any Participant who terminated employment with the Employer or was laid off or ceased to be an Eligible Employee prior to January 1, 2003, the following Accrued Benefit shall be applicable for the following period of time:

2002                                      *

2001                                      $43.50 per year of Accrual Service

2000                                      $43.50 per year of Accrual Service

1999                                      $43.50 per year of Accrual Service

1998                                      $39.00 per year of Accrual Service

1997                                      $35.00 per year of Accrual Service

1996                                      $34.00 per year of Accrual Service

1995                                      $28.50 per year of Accrual Service

1991                                      $28.00 per year of Accrual Service

1990                                      $27.00 per year of Accrual Service

1989                                      $25.00 per year of Accrual Service

1988                                      $24.00 per year of Accrual Service

1987                                      $22.00 per year of Accrual Service

1986                                      $21.00 per year of Accrual Service

1985                                      $19.00 per year of Accrual Service

1984                                      $16.00 per year of Accrual Service

1983                                      $14.00 per year of Accrual Service

1982                                      $13.00 per year of Accrual Service

1981                                      $11.00 per year of Accrual Service

9/1/80 - 12/31/80                   $ 9.50 per year of Accrual Service, except for participants who terminated employment prior to 1/1/80.

*        $43.50 multiplied by the number of years of Accrual Service through December 31, 2001; plus, Hours Worked from January 1, 2002 through June 30, 2002 divided by 1800 hours multiplied by $43.50; plus, Hours Worked from July 1, 2002 through December 31, 2002 divided by 1800 multiplied by $21.75.  No Hours Worked in 2002 in excess of 1800 hours shall be included in these equations.  Pursuant to Section 2.2, there will be no accumulation of Accrual Service for any complete Accrual Computation Period in which a Participant accumulates less than 900 Hours Worked; in addition, if any Eligible Employee has less than 900 Hours  Worked  in the year 2002, he or she shall not be entitled to any benefit accrual for 2002.

    The Accrued Benefit of any Participant who terminated employment with the Employer on or before December 31, 1979 shall be the Accrued Benefit that was in effect in the Plan at the time of such termination.

    Section 2.4 -  Actuarial Equivalent.  In the event that a specific actuarial factor is not provided under this Plan, the appropriate actuarial equivalence factor shall be the actuarial factors issued by the Pension Benefit Guaranty Corporation for the first day of January of the year for which the actuarial equivalence is provided.  The factor shall use an average of the appropriate male and female factors.

    Section 2.5 -  Actuary.  The Actuary is the corporation, firm or individual appointed and acting from time to time pursuant to the terms of Article VI.

    Section 2.6 -  Beneficiary.  A Beneficiary is the person or persons, natural or otherwise, other than a joint or contingent annuitant, designated by a Participant to receive any benefit payable under the Plan in the event of his death.

    A Participant who has designated a Beneficiary may, without the consent of such Beneficiary, alter or revoke such designation.  However, the spouse of a Participant must consent to the naming of a Beneficiary other than himself or herself.  Such consent must be executed in the presence of a notary public.  To be effective, any Participant's designation, alteration, or revocation of a Beneficiary shall be in writing, in such form as the Trustees may prescribe, and shall be filed with the Trustees prior to the death of the Participant.  If, at the time a death benefit becomes payable, there is not on file with the Trustees a fully executed designation of Beneficiary with spousal consent where required, then the designated Beneficiary shall be the person or persons surviving him in the first of the following classes in which there is a survivor, share and share alike:

(a)      his spouse;

(b)      his children, except that if any of his children predecease him but leave issue surviving him, such issue shall take by right of representation the share their parent would have taken if living;

(c)      his parents;

(d)      his brothers and sisters;

(e)      his personal representative or representatives (executors and administrators).

The identity of each Beneficiary in each case shall be determined by the Trustees.  Each such determination shall be final and binding for all persons.  Should the Plan Administrator not have a valid consent by a spouse to the designation by a Participant of a Beneficiary other than the spouse, the Trustees will pay a Participant's benefits to the spouse.

    Section 2.7 -  Break in Service.  A Break in Service occurs only when an Eligible Employee receives no compensation and no vesting credit during a Vesting Computation Period.  Such compensation shall include direct and indirect compensation by the Employer for Hours Worked including sick pay, vacation pay, pay during a leave of absence, disability income, and such other indirect compensation as may be required to be recognized for Break in Service purposes under ERISA or rules or regulations related thereto.

    Section 2.8 -  Code.  Code means the Internal Revenue Code of 1986, as amended or replaced from time to time.

    Section 2.9 -  Collective Bargaining Agreement.  Collective Bargaining Agreement means the existing Collective Bargaining Agreement between Buckbee-Mears Saint Paul and the Union effective June 1, 1976 through May 31, 1978, as well as any extensions or renewals thereof, or any new Collective Bargaining Agreement executed in the future which provides for the payment of contributions to the Retirement Fund as well as any extension or renewal thereof.

    Section 2.10 - Company.  Company means BMC Industries, Inc.

    Section 2.11 - Computation Periods.

(a)      Eligibility Computation Periods - the 12-month period beginning with an employee's Employment Commencement Date, and the 12-month period commencing on any Plan Anniversary Date after his Employment Commencement Date.

(b)      Vesting and Accrual Computation Periods - the 12-month period commencing on the Plan Anniversary Date.

    Section 2.12 - Effective Date.  Except as specifically stated herein, the Effective Date of this Restatement is January 1, 2001.

    Section 2.13 - Eligibility and Vesting Service.

(a)      Eligibility Service after December 31, 1975 is accumulated at the rate of one year for each Eligibility Computation Period in which an Eligible Employee completes 1,000 or more Hours Worked.  There is no accumulation for an Eligible Employee for a Computation Period in which he has less than 1,000 Hours Worked.

(b)      Vesting Service after December 31, 1975 is accumulated at the rate of one year for each Vesting Computation Period in which an Eligible Employee completes 1,000 or more Hours Worked.  There is no accumulation for an Eligible Employee for a Vesting Computation Period in which he has less than 1,000 Hours Worked.

Except, in the event an Eligible Employee's first Eligibility Computation Period in which 1,000 or more Hours Worked are completed overlaps two Vesting Computation Periods, neither of which contains 1,000 or more Hours Worked by the Eligible Employee, the second such Vesting Computation Period will be deemed, for vesting purposes, to contain 1,000 hours.  There is no accumulation for any Vesting Computation Periods prior to the Vesting Computation Period in which the Eligible Employee attains the age of 18.

Notwithstanding the definition of "Hours Worked" contained in this Plan, all Hours Worked by an employee for the Employer, the Company and any other corporation that is a member of a controlled group of corporations, (within the meaning of Code section 1563(a) without regard to Code sections 1563(a)(4) and 1563(e)(3)(C)) that includes the Company, any trade or business (whether or not incorporated) that together with the Company is under common control (within the meaning of Code section 414(c)), any member of an "affiliated service group" (within the meaning of Code section 414(m)) of which the Company is a member or any other organization that, together with the Company, is treated as a single employer pursuant to Code section 414(o) and Treasury Regulations thereunder ("ERISA Affiliates"); provided, that, for purposes of applying the limitations set forth at Section 414, such determination under Code section 1563(a) will be made by substituting the phrase "more than 50 percent" for the phrase "at least 80 percent" wherever it appears in such Code section, and will be counted for Eligibility Service and Vesting Service purposes whether or not such employee was an Eligible Employee at the time the hours were worked.

Eligible Employees on an authorized military leave of absence will accumulate hours for Vesting and Eligibility Service at the rate of 40 hours for each seven (7) consecutive days of leave.

(c)      Vesting and Eligibility Service prior to January 1, 1976 for a Participant as of January 1, 1976, who had been covered under the Former Plan, will be the Participant's last period of continuous employment with the Company prior to January 1, 1976 rounded to the nearest year.

    Section 2.14 - Eligible Employee.

(a)      Except as provided in Subsection (b), an "Eligible Employee" is an employee who has performed services for the Employer as an employee of the Employer (as classified by the Company or the Employer at the time the services are performed without regard to any subsequent reclassification) for a period of at least sixty-six (66) working days covered by the Collective Bargaining Agreement and on whose behalf contributions are made to the Retirement Fund pursuant to the terms of the Collective Bargaining Agreement between Buckbee-Mears Saint Paul and the Union.

(b)      An individual who is classified by the Company or the Employer as an independent contractor, leased employee or as any other status in which the individual is not classified by the Company or the Employer as an employee of the Employer at the time services are performed is not an Eligible Employee.  No judicial or administrative reclassification, or reclassification by the Company or the Employer, will be applied to grant retroactive eligibility to any individual under the Plan.

(c)      In addition, Eligible Employee includes full-time officers and employees of the Union, the Retirement Fund, and any other benefit fund established by the Collective Bargaining Agreement, provided that contributions to the Retirement Fund are made on behalf of said Eligible Employees by their respective Employers.

    Section 2.15 - Employer.  Employer shall mean Buckbee-Mears Saint Paul (a unit of  the Company) and any employer of an Eligible Employee on whose behalf contributions are made into the Retirement Fund.  The Union, the Retirement Fund, and other benefit funds described in Section 2.14 hereof shall be deemed Employers for the limited purpose of making payments to the Retirement Fund on behalf of Eligible Employees (as defined in Section 2.14).

    Section 2.16 - Employment Commencement Date.  The date an Eligible Employee first works one hour for the Employer.

    Section 2.17 - ERISA.  The Employee Retirement Income Security Act of 1974, as amended from time to time.

    Section 2.18 - Fiduciary.  The named Fiduciary of the Plan is the Board of Trustees, the Investment Manager, the Plan Administrator, insurance company or companies, or combination thereof, appointed and acting from time to time in accordance with the provisions of Section 5.2 and Article VII and the  Retirement Fund, to hold, invest and disburse assets in the Retirement Fund and administer the Plan.

    Section 2.19 -  Former Plan.  The Former Plan is the Restated Graphic Communications International Union, Twin Cities Local 6A - Buckbee Mears Pension Plan in existence the day before the Effective Date of this Plan.

    Section 2.20 - Hours Worked.  Determined as follows:

(a)      For Eligible Employees whose hours are not required to be counted and recorded by any Federal Law such as the Fair Labor Standards Act, Hours Worked will be recorded at the rate of 45 for each 7 days of employment in covered employment during the Computation Period in which the Eligible Employee would be required under Subsection (c) hereof to be credited with at least one (1) Hour Worked.

(b)      For all other Eligible Employees, Hours Worked will be total Hours Worked computed in accordance with Subsection (c) hereof.

(c)      (1)      "Hours Worked" shall mean each hour worked for which the Employer, either directly or indirectly, pays an Eligible Employee, or for which the Eligible Employee is entitled to payment, for the performance of duties during the Plan Year.  The Eligible Employee shall be credited with the Hours Worked under this subparagraph (1) for the Plan Year in which the Eligible Employee performs the duties, irrespective of when paid;

        (2)      Each Hour Worked for back pay, irrespective of mitigation of damages, to which the Employer has agreed or for which the Eligible Employee has received an award.  Hours Worked shall be credited under this subparagraph (2) to the Eligible Employee for the Plan Year(s) to which the award or the agreement pertains rather than for the Plan Year in which the award, agreement or payment is made; and

        (3)      Each Hour Worked for which the Employer, either directly or indirectly, pays an Eligible Employee, or for which the Eligible Employee is entitled to payment (irrespective of whether the employment relationship is terminated), for reasons other than for the performance of duties during a Plan Year, such as leave of absence, vacation, holiday, sick leave, illness, incapacity (including disability and periods for which an Eligible Employee is entitled to receive workers' compensation benefits), layoff, jury duty or military duty.  Hours Worked shall be credited under this subparagraph (3) for the Plan Year in which the Employer pays the Eligible Employee, the Eligible Employee becomes entitled to payment or the payment becomes due, whichever first occurs.  Notwithstanding the preceding provisions of this subparagraph (3), Hours Worked shall not be credited for:

(i)       more than five hundred one (501) Hours Worked under subparagraph (c) to an Eligible Employee on account of any single continuous period during which the Eligible Employee does not perform any duties (whether or not such period occurs during a single Plan Year);

(ii)      hours for which payments are made or due to the Eligible Employee under a plan maintained solely for the purpose of complying with the applicable unemployment compensation law; and

(iii)     hours for which a payment to an Eligible Employee solely reimburses the Eligible Employee for medical or medically related expenses incurred by the Eligible Employee.

An Hour Worked shall not be credited under more than one of the above subparagraphs (1), (2) or (3) of subsection (c).  Furthermore, if the Eligible Employee is to be credited with Hours Worked for the twelve (12) month period beginning with the Eligible Employee's Employment Commencement Date, then the twelve (12) month period shall be substituted for the term "Plan Year" wherever the latter term appears in this Section 2.20.

(d)      Hours Worked shall also include all Hours Worked by any Eligible Employee for which the Eligible Employee receives compensation from the Union.  These hours represent lost time hours which, but for this subsection (d), the Eligible Employee would not otherwise be given credit.

Any ambiguity with respect to the crediting of an Hour Worked shall be resolved in favor of the Eligible Employee.  Furthermore, in crediting Hours Worked under this Section 2.20, the rules of paragraphs (b) and (c) of Department of Labor Regulation § 2530.200b-2 which the Plan, by this reference, specifically incorporates in full within this Section 2.20, shall be applied.

Solely for purposes of determining whether the Eligible Employee incurs a Break in Service under any provision of this Plan, the Plan Administrator shall credit Hours Worked during an Eligible Employee's unpaid absence period due to maternity or paternity leave if his or her absence is due to the Eligible Employee's pregnancy, the birth of the Eligible Employee's child, the placement with the Eligible Employee of an adopted child, or the care of the Eligible Employee's child immediately following the child's birth or placement.  The Plan Administrator shall credit Hours Worked under this paragraph on the basis of the number of Hours Worked the Employee would receive if he were paid during the absence period or, if the Plan Administrator cannot determine the number of Hours Worked the Eligible Employee would receive, on the basis of eight (8) hours per day during the absence period.  The Plan Administrator only shall credit the number of Hours Worked (up to 501 Hours Worked) necessary to prevent an Eligible Employee's Break in Service.  The Plan Administrator shall credit all Hours Worked described in this paragraph to the computation period in which the absence period begins or, if the Eligible Employee does not need these Hours Worked to prevent a Break in Service in the computation period in which is absence period begins, the Plan  Administrator shall credit these Hours Worked to the immediately following Computation Period.  The Plan Administrator shall apply this paragraph for absence periods which begin in Plan Years commencing after December 31, 1984.

(e)      Hours Worked shall also include hours during which a Participant would have worked but for one or more involuntary furlough(s), up to a maximum of sixty (60) working days or four-hundred fifty (450) hours in any Plan Year.  An involuntary furlough shall be defined as a period of time during which the Participant would have worked but for the temporary shutdown of operations mandated by the Company.

(f)       Notwithstanding any provision of this Plan to the contrary, contributions, benefits and service credit with respect to qualified military service will be provided in accordance with Section 414(u) of the Code.

    Section 2.21 - Normal Retirement Date.  The Normal Retirement Date of a Participant is the last day of the month in which he attains age 65.

    Section 2.22 - Normal Retirement Age.  A Participant's Normal Retirement Age is age 65, or five years after the Participant commenced participation in the Plan, whichever is later.

    Section 2.23 - PBGC.  Pension Benefit Guaranty Corporation, a body corporate within the Department of Labor established under the provisions of Title IV of ERISA.

    Section 2.24 - Participant.  A Participant is an Eligible Employee or former Eligible Employee who has satisfied the eligibility requirements of Article III and who is either accruing a benefit or is entitled to receive a benefit under the Plan.

    Section 2.25 - Plan.  The Plan is the Graphic Communications International Union, Twin Cities Local 6A - Buckbee-Mears Pension Plan as may be amended from time to time, this document comprising the Seventh Restatement of such Plan.

    Section 2.26 - Plan Administrator.  The Plan Administrator shall be appointed by the Trustees and serve until replaced by the Trustees or until said Plan Administrator resigns.

    Section 2.27 - Plan Anniversary Date.  The Plan Anniversary Date of this Plan is January 1.

    Section 2.28 - Plan Year.  The Plan Year is the 12-month period commencing each January 1.

    Section 2.29 - Re-Employment Commencement Date.  The date following a Break in Service when an Eligible Employee first works one hour for the Employer.

    Section 2.30 - Retirement Fund.  Retirement Fund  means the Restated Agreement and Declaration of Trust of  Graphic Communications International Union, Twin Cities Local 6A - Buckbee-Mears Retirement Fund, consisting of all contributions to the Retirement Fund received by the Trustees, together with all income, increments, earnings, and profits therefrom, and all other assets held by the Trustees for the uses, purposes, and trusts set forth in said Retirement Fund Trust Agreement.

    Section 2.31 - Termination of Employment.  Termination of Employment is the severance of an Eligible Employee's employment relationship with the Employer, the Company and ERISA Affiliates (as defined in Section 2.13).

    Section 2.32 - Trustees.  Trustees or Trustee means the Trustees or a Trustee of the Retirement Fund.

    Section 2.33 - Union.  Union means Graphic Communications International Union, Twin Cities Local 6A.

    Section 2.34- Vesting.  For purposes of this Plan, an Eligible Employee's Accrued Benefit shall be vested pursuant to the following schedule:

Years of Vesting Service                                 % Vested

0-4 Years of Service                                        0%

5   Years or More                                         100%
 

For Plan years prior to January 1, 1989, the following schedule applies:
 

Years of Vesting Service                                 % Vested

0-9 Years of Service                                         0%

10 Years or More                                          100%

ARTICLE III

EMPLOYEE PARTICIPATION

    Section 3.1 - Eligibility for Participation.  Each Eligible Employee shall become a Participant in the Plan as follows:

(a)      Any Eligible Employee included under the provisions of the Former Plan as of the Effective Date shall continue to participate in accordance with the provisions of this amended and restated Plan.

(b)      Any other Eligible Employee as of the Effective Date who has both attained age 21 and completed an Eligibility Computation Period ending prior to said date, during which he had not less than 1,000 Hours Worked, shall become a Participant on the Effective Date.

(c)      The participation of any Eligible Employee thereafter to become a Participant shall commence as of the earlier of January 1 or July 1 following the date he has both attained age 21 and completed an Eligibility Computation Period ending prior to said date of not less than 1,000 Hours Worked.

    After a Break in Service, the provisions of Section 3.3 and 3.4 shall be applicable.

    Section 3.2 - Transfer to Eligible Employee Status.  Transfer from an ineligible status to the status of an Eligible Employee will result in immediate participation if the Eligible Employee satisfies the requirements of Section 3.1; otherwise he will begin participation in The Plan as provided for in Section 3.1.

    Section 3.3 - Re-Employment after a Break in Service.  An Eligible Employee who has been re-employed after a Break in Service may resume participation in the Plan as soon as he has completed a 12-month period in which he has 900 Hours Worked.  He shall reenter the Plan retroactive to his Re-Employment Commencement Date.

    Such a Participant shall receive Accrual Service if he has 900 or more Hours Worked during the first Accrual Computation Period ending after his Re-Employment Commencement Date.  If he has less than 900 Hours Worked during this partial Computation Period but he has hours equal to at least 900 considering the fraction of the Computation Period worked, he will accumulate a fraction of a year of Accrual Service equal to the ratio of the Hours Worked during such partial Computation Period to 1,800 hours for a full accrual Computation Period.  For periods of re-employment prior to January 1, 1981, an Eligible Employee shall earn credit as described in the previous sentence with 975 hours substituted for 900 hours and 1,950 hours substituted for 1,800 hours.

    Section 3.4 - Preservation of Pre-Break Service.  In the event of re-employment after a Break in Service, service completed prior to the Break in Service for non-vested Participants will be disregarded for all purposes under the Plan unless the number of the Eligible Employee's consecutive Breaks in Service is less than:

(a)      The Eligible Employee's aggregate Years of Vesting Service (without regard to Vesting Service disregarded under Section 3.4), or

(b)      five (5) years, if greater than (a).

    In the event that a Participant terminates employment with the Employer for any reason and suffers consecutive Breaks in Service of five years or less and returns to employment with the Employer as an Eligible Employee, that Participant's Accrued Benefit under Section 2.3 of this Plan shall be calculated by multiplying all of that Participant's years of Accrual Service with the Employer times the Accrued Benefit rate in effect as of the date of that Participant's final termination of employment with the Employer.  In the event that a Participant terminates employment with the Employer for any reason, suffers consecutive Breaks in Service in excess of five years and subsequently returns to employment with the Employer as an Eligible Employee, the Participant's Accrued Benefit under Section 2.3 of the Plan shall be calculated by multiplying the applicable Accrued Benefit rate in effect at the time of the Participant's first Termination of Employment times the years of Accrual Service earned at that time and adding to that figure the amount determined by multiplying the years of Accrual Service earned after the Breaks in Service times the applicable Accrued Benefit rate in effect at the Participant's final Termination of Employment with the Employer.

ARTICLE IV

BENEFITS

    Section 4.1 - Normal Retirement Benefit Formula.  A Participant's pension benefit payable in the normal form shall be a benefit payable for his lifetime in a monthly amount equal to his Accrued Benefit.  The Termination of Employment of a Participant on or after his Normal Retirement Age shall be deemed to be a normal retirement.  Upon such retirement, he shall be entitled to a pension in the amount determined according to the first sentence of this Section 4.1 payable monthly for life, with the first payment to be made as of the first day of the month next following his Termination of Employment, if he is then living, and the last  payment as of the first day of the month in which his death occurs.

    Section 4.2 - Accrued Benefit.  The Accrued Benefit may be determined as of any point in time that the Participant is an Eligible Employee.  In no event will any Accrued Benefit determined after the Effective Date be less than the Accrued Benefit determined as of the preceding Plan Anniversary Date.

    Section 4.3 - Early Retirement Benefit.  The Termination of Employment of a Participant prior to his Normal Retirement Date shall be deemed to be an early retirement if he has then attained age 55 and completed at least 10 years of Vesting Service.  Upon such early retirement, he shall be entitled to a pension payable monthly for life, with the first payment to be made as of the first day of the month next following his Normal Retirement Date, if he  is then living, and the last payment as of the first day of the month in which his death occurs.  The amount of each monthly payment shall equal his Accrued Benefit.

    In lieu of such payment the Participant may elect to have benefits commence on the first of any month following his Termination of Employment and prior to his Normal Retirement Date.  The benefit payable from such earlier commencement date shall be the pension benefit payable in the normal form (as determined under Section 4.1)..

(a)      reduced by six and two-thirds (6-2/3%) percent reduction per year for the first five years of commencement immediately prior to age 65; and

(b)      reduced by three and one-third (3-1/3%) percent reduction per year for an additional five years.

    Section 4.3. A. - Special Early Retirement Benefit.  Effective January 1, 1997, any Participant who terminates employment with the Employer after he reaches age 55 on or after January 1, 1997 and has completed at least 25 years of Accrual Service as of the date of termination shall be eligible to commence a retirement benefit after he has attained age 62 without any reduction in the Accrued Benefit calculated under Section 2.3.

    Section 4.4 - Benefit Upon Other Termination of Employment.  If a Participant's Termination of Employment occurs prior to his Normal Retirement Age, and if at the time of his Termination of Employment he has completed at least 5 years of Vesting Service and has not attained age 55, he shall be entitled to a pension payable monthly for life, with the first payment to be made as of the first day of the month next following his Normal Retirement Date, if he is then living, and the last payment as of the first day of the month in which his death occurs.  The amount of each monthly payment shall equal his Accrued Benefit.

    Section 4.4.A. - Disability Benefit.  Effective January 1, 1998, any Participant with at least 10 years of Accrual Service who terminated employment after age 55 due to a total and permanent disability as determined by the Social Security Administration shall be eligible to retire as of the date of disability without any reduction in the Accrued Benefit calculated under Section 2.3.  Upon such disability retirement, he shall be entitled to a pension payable monthly for life, with the first payment to be made as of the first day of the month following his Termination of Employment and submission of his application for the pension benefit accompanied by evidence that he has been determined to be totally and permanently disabled by the Social Security Administration.  If the Participant is no longer totally and permanently disabled at any time prior to age 62, the disability pension shall be discontinued and the Participant shall be entitled to additional pension benefits only in accordance with the other provisions in the Plan.

    Section 4.5 - Early Commencement of Benefits.  A Participant who qualifies under Section 4.4 and has at least ten years of Vesting Service may elect a reduced monthly benefit which is in lieu of the aforesaid benefit, with the first payment to be made as of the first day of any month after his attainment of age 55 and prior to his Normal Retirement Date and the  last payment as of the first day of the month in which his death occurs.  The benefit payable from such earlier commencement date shall be the pension benefit payable in the normal form (as determined under Section 4.1):

(a)      reduced by six and two-thirds (6/2/3%) percent reduction per year for the five years immediately prior to age 65; and

(b)      reduced by three and one-third (3-1/3%) percent reduction per year for an additional five years.

    Section 4.6 - Minimum Benefit.  In no event will the benefit determined in Section 4.1, 4.2, 4.3 or 4.4 and payable from Normal Retirement Date be less than the Accrued Benefit under the Former Plan as of the Effective Date.

    Section 4.7 - Benefits that Matured Prior to the Effective Date.  Benefits, if any, payable on account of a Participant's Termination of Employment prior to the Effective Date shall be  determined and paid in accordance with the provisions of the Plan in effect as of the date of his Termination of Employment.

    Section 4.8 - Non-Duplication of Benefits.  In the event that a Participant terminates covered employment under the Collective Bargaining Agreement but continues in the employment of the Employer or the Company in a different position, the Participant shall not accrue any additional Accrual Service under this Plan unless the Participant later resumes covered employment under the Collective Bargaining Agreement.  In addition, the Accrued Benefit defined under Section 2.3 of the Plan shall be calculated for that Participant who terminated employment with the Employer as of the date the Participant ceased to be an Eligible Employee covered by the Collective Bargaining Agreement and not the date the Participant later terminates non-covered employment with the Employer or the Company.  In the event that the Participant is re-employed and is an Eligible Employee covered by the Collective Bargaining Agreement, and received Accrual Service after a one-year Break in Service, the Accrued Benefit calculated under Section 2.3 of the Plan shall be calculated based on the applicable Accrued Benefit at the time of the earlier termination times the years of Accrual Service at that time plus later years of Accrual Service times the applicable Accrued Benefit rate in effect under the Plan at the subsequent Termination of Employment.  In addition, notwithstanding any other provisions of the Plan, benefits otherwise payable to a Participant under Section 4.1, 4.3 or 4.4 shall be suspended during such period as he receives long or short term disability benefits provided by the Employer or the Company and during periods of re-employment with the Employer prior to the Participant's Normal Retirement Date.  Any benefits payable subsequent to Termination of Employment will be actuarially adjusted to reflect the payments already received.

    Section 4.9 - Optional Forms of Benefit Payments.  In lieu of the amount and form of pension payable under Section 4.1, 4.3 or 4.4, a Participant may, under such rules and regulations as the Trustees may prescribe which are in accord with the advice of the Actuary, and subject to the provisions of Section 4.10 and 4.16, elect to have a pension benefit payable in any of the following optional forms:

(a)      Ten (10) Year Certain and Life Benefit.  A reduced monthly benefit payable to the Participant for his or her life, with the provision that, if the Participant dies before having received 120 monthly payments, such reduced monthly payments will continue to the Participant's designated Beneficiary until the number of monthly payments made to the Participant and the Participant's designated Beneficiary total 120;

(b)      Joint and Fifty (50%) Percent Survivor Benefit.  A reduced monthly benefit payable to the Participant for his or her life, with the provision that, if the Participant is survived by his or her contingent annuitant, one-half of such reduced monthly benefit will be continued to the contingent annuitant for the duration of the contingent annuitant's life; and

(c)      Joint and One Hundred (100%) Percent Survivor Benefit.  A reduced monthly benefit payable to the Participant for his or her life, with the provision that, if the Participant is survived by his or her contingent annuitant, such reduced monthly benefit will be continued to the contingent annuitant for the duration of the contingent annuitant's life.

The amount of the benefit available under any of the options set forth in this Section shall be calculated by applying the reduction factors set forth in Appendix A to this Pension Plan.  Benefit payments under any option elected in accordance with the terms of this paragraph shall commence on the same date that benefit payments would otherwise commence under Section 4.1, 4.3, 4.4 or 4.5, whichever is applicable.  In conjunction with the Participant's election of an optional benefit under subsections (b) or (c), the Participant must designate, in form prescribed by the Trustees, a contingent annuitant to receive the survivor benefits thereunder; provided, that, if the designation is not made at that time, a designation may be made at a later date, but not after the commencement of benefit payments to the Participant.  Notwithstanding other provisions of this paragraph to the contrary, if a Participant dies before his or her payments have commenced, the Trustees shall not make payment to a Beneficiary who is not the Participant's spouse for a period which exceeds five (5) years from the date of the Participant's death.

    If a Participant remains in the employ of the Company after his Normal Retirement Date, and if his death occurs thereafter prior to his Termination of Employment, and if he elected an optional form of benefit payment under this Section which was not revoked prior to his death, the same benefit shall be provided his Beneficiary or joint or contingent annuitant under the option as though the Participant's Termination of Employment had occurred on his Normal Retirement Date and he had received monthly payments under the option for each month prior to his death.

    Section 4.10 - Qualified Joint and Survivor Annuity.  Unless a Participant elects otherwise, as hereinafter specified in Section 4.16, benefits shall be paid in the form of a Qualified Joint and Survivor Annuity with respect to any Participant who has a spouse and who -

(a)      begins to receive benefit payments under Section 4.1, 4.3, 4.4 or 4.5, or

(b)      dies on or after attaining Normal Retirement Age and prior to his or her Termination of Employment, or

(c)      ceases to be an Eligible Employee on or after the date he is entitled to receive benefits under Sections 4.1 or 4.4 and thereafter dies before beginning to receive such benefits.

A "Qualified Joint and Survivor Annuity" is an annuity for the life of the Participant with a survivor annuity for the life of his spouse which is 50% of the amount payable for the life of the Participant.  The amount of the benefit available under this Section shall be calculated by applying the reduction factors set forth in Appendix A to this Plan, under the Option "Joint and 50% Survivor."

    Section 4.11 - Pre-Retirement Spouse Annuity.

(a)      Eligibility. If a married Participant dies prior to commencement of payment of his Nonforfeitable Accrued Benefit, the Trustee will distribute to the Participant's surviving spouse a pre-retirement survivor annuity, unless the Participant and his spouse were not married throughout the one (1) year period ending on the date of his death.  This Section shall apply to a Participant who dies after August 22, 1984, and either (i) completes at least one (1) Hour Worked with the Employer after August 22, 1984, or (ii) separated from Service with at least ten (10) years of service and completed at least one (1) Hour Worked with the Employer in a Plan Year beginning after December 31, 1975.  If a Participant's death benefit is payable on or after the Effective Date and this Section does not apply to the Participant, the Plan Administrator shall make payment of the Participant's entire Nonforfeitable Accrued Benefit in accordance with Sections 4.10 and 4.15, subject to the requirements of subsection (c) hereof.

For a Participant dying after the earliest retirement age under the Plan, the pre-retirement spouse annuity shall equal the survivor annuity portion of the qualified joint and fifty (50%) percent survivor annuity the Trustees would have paid under Section 4.10 if the Participant had commenced receiving the qualified joint and survivor annuity the day before his death.  For a Participant dying on or before the earliest retirement age under the Plan, the pre-retirement survivor annuity shall equal the survivor annuity portion of the qualified joint and fifty (50%) percent survivor annuity the Trustees would have paid under Section 4.10 if the Participant had separated from service on the date of his death, had commenced receiving the qualified joint and survivor annuity at the earliest retirement age under the Plan, and had died the day after attaining the earliest retirement age under the Plan.  The "earliest retirement age under the Plan" is the earliest date on which the Plan permits the Participant to elect to receive retirement benefits.  Notwithstanding the immediately preceding provisions of this paragraph, if the actuarial equivalent of the pre-retirement spouse annuity calculated under the formula set forth in Section 2.4 is not greater than $5,000, (using the GATT interest rates in effect as of retirement) the Trustees will pay the Participant's surviving spouse the actuarial equivalent in a single lump sum payment as a complete settlement of all obligations under this Plan.

The Trustees shall commence payment of the pre-retirement spouse annuity on or before the later of one (1) year after the Participant's death or the date the Participant would have attained age seventy and one-half (70-1/2) unless the Participant's surviving spouse files an election to commence payment at some earlier date.

(b)      No Reduction of Pension Benefits.  A Participant's pension benefits shall not be reduced as a result of the pre-retirement spouse annuity coverage required under Section 4.11(a) or the survivor's annuity coverage under Section 4.11(c).  The Plan shall bear the cost of providing the pre-retirement spouse annuity or the survivor's annuity benefits.

(c)      Payment of Certain Survivor Benefits After the 1/1/2001.  If a married Participant who is not subject to Section 4.11(a) but who has received credit for at least one (1) Hour Worked after September 1, 1974, has a death benefit payable on or after the Effective Date, the Participant's surviving spouse shall receive a spouse's pre-retirement annuity if:

(1)      the Participant had made a spouse's annuity election at any time during the spouse annuity election period; and

(2)      dies while employed as an Eligible Employee of the Employer on or after attaining qualified early retirement age.  The spouse annuity election period shall begin on the ninetieth (90^th) day before the Participant attains the qualified early retirement age and shall end on the date of the Participant's Termination of Employment.  A Participant's "qualified early retirement age" is the later of the first day of the one hundred twentieth (120^th) month beginning before the Participant attains Normal Retirement Age, or the date on which the Participant began participation under this Plan.

Furthermore, if a married Participant who is not subject to Section 4.11(a) but who has received credit for at least one (1) Hour Worked after September 1, 1974, has a death or termination benefit payable on or after the Effective Date, the Participant's surviving spouse shall receive a spouse's annuity if:

(3)      the Participant dies on or after Normal Retirement Age while employed  by the Employer, or has a Termination of Employment on or after attaining his qualified early retirement age but dies before the Trustee commences payment of his pension; and

(4)      the Participant (and, for elections made after December 31, 1984, the Participant's spouse) has not waived the qualified joint and survivor annuity during the ERISA election period.  The ERISA election period begins on the later of (i) the date one hundred and eighty (180) days prior to the Participant's attaining qualified early retirement age, or (ii) the date the Participant commenced participation in the Plan, and ends on the Participant's annuity starting date under Section 4.10.

The spouse's pre-retirement annuity shall equal the survivor annuity portion of the qualified joint and survivor annuity payable under Section 4.10 determined as if the Participant had retired the day before his death and commenced receiving the qualified joint and survivor annuity.

    Section 4.12 - Payment of Small Amounts.

(a)      If the actuarially equivalent present value of a Participant's vested Accrued Benefit does not exceed Five Thousand Dollars ($5,000) and did not exceed such amount at the time of any previous distribution of such benefit, the benefit shall be paid to the Participant or to his or her surviving spouse following the Participant's death in a single lump sum payment no later than sixty (60) days after the close of the Plan Year following the Plan Year in which the Participant terminates employment or dies, whichever occurs first.  Actuarially equivalent lump sum values shall be calculated on the basis of (1) the mortality table based on the prevailing commissioners' standard table (described in section 807(d)(5)(A) of the Code, which is the mortality table prescribed in Revenue Ruling 95-6 for distributions with an annuity starting date before December 31, 2002 and the mortality table prescribed in Revenue Ruling 2001-62 for distributions with an annuity starting date on or after December 31, 2002)) used to determine reserves for group annuity contracts issued on the date as of which the lump sum is being determined (without regard to any other subparagraph of section 807(d)(5)), as prescribed by the Commissioner of Internal Revenue in revenue rulings, notices or other guidance and (2) for any lump sum payment made during a calendar year, an interest rate equal to the annual interest rate on 30-year Treasury securities for the November immediately preceding such calendar year as such rate is prescribed by the Commissioner of Internal Revenue in revenue rulings, notices or other guidance.

(b)      In the case of any distribution pursuant to this section that constitutes an "eligible rollover distribution," within the meaning of section 402(c)(4) of the Internal Revenue Code, the Trustees will, if so instructed by the distributee in accordance with uniform rules, make the distribution to an "eligible retirement plan" within the meaning of section 402(c)(8) of the Internal Revenue Code.  The foregoing provision will not apply if (i) the aggregate taxable distribution to be made to the distributee from this Plan during the distributee's taxable year is less than Two Hundred Dollars ($200) or (Ii) if less than the entire taxable amount of the distribution is to be distributed to an eligible retirement plan and the amount to be distributed to the eligible retirement plan is less than five Hundred Dollars ($500).

    Section 4.13 - No Other Benefits.  In the event the Trustees distribute any part or all of  a Participant's Accrued Benefit to him and the Participant later resumes active employment with the Employer, the Trustee shall compute the Participant's Accrued Benefit by taking into account all of the Participant's Years of Participation.  However, the Trustee shall offset the Participant's Accrued Benefit so computed by the Participant's Accrued Benefit attributable to any distribution the Trustee has made to the Participant.

    Section 4.14 - Maximum Benefits.  The maximum benefit, when expressed as a monthly pension, shall not exceed $7,500.00, subject to the following:

(a)      The maximum shall apply to the single-life pension computed under Article IV.

(b)      If benefits begin prior to age 65, the maximum will apply to such reduced pension; provided that, if benefits begin prior to age 55, the maximum will apply to a pension beginning at age 55, which is the Actuarial Equivalent of such benefit.

(c)      If the Participant has fewer than ten years of credited service at retirement, the applicable maximum shall be multiplied by a fraction, of which the numerator is his Accrual Service and the denominator is 10.

(d)      The maximum amount of $7,500.00 per month shall be increased as permitted in Section 415(b) of the Internal Revenue Code.

    Notwithstanding the foregoing with respect to a Participant included under the prior provisions of the Plan, the maximum computed under this subsection shall not be less than the Pension payable under the Plan provisions in effect as of December 31, 1982 based upon his rate of compensation under the Plan in effect as of such date and on Accrual Service to the date of his Termination of Employment.

    Section 4.15 - Death Benefit.  Upon the death of a Participant who has ten (10) or more years of Vesting Service and who is an Eligible Employee whose employment with the Employer has not terminated or is a former Eligible Employee currently on leave of absence or laid off and maintaining his name on the Employer's seniority or recall list, the sum of Five Thousand and no/100s ($5,000.00) Dollars shall be paid in a single lump sum payment to the Participant's Beneficiary designated in accordance with Section 2.6 of this Plan.  However, if such Participant is married at the time of his death and has been married for the one year period immediately preceding his death, any benefits payable as a result of Participant's death shall be paid to his spouse unless his spouse has consented to the designation of another Beneficiary.  Such consent shall be notarized and submitted to the Plan Administrator.

    Section 4.16 - Manner of Election - Revocation for Joint and Survivor Annuity - Normal Retirement Age.  A Participant may make an election not to have his Accrued Benefit paid in the form of a Qualified Joint and Survivor Annuity under Section 4.10 at any time during the election period.  The election period shall begin on the date the Plan Administrator furnishes to the Participant the information required under the third paragraph of this Section 4.16 and shall end on the ninetieth (90^th) day before the Trustee commences to pay the Participant his Accrued Benefit.  If, within 60 days from the date the information was furnished as required by the preceding sentence, a Participant makes a request for additional information, the election period shall extend, to the extent necessary, to include the ninety (90) calendar days immediately following the date the Plan Administrator either mails or personally delivers the requested additional information to the Participant.  A Participant may revoke an election made under this Section 4.16 at any time during the election period, and thereafter may make a new election at any time within the election period.  For waiver elections made after December 31, 1984, a Participant's spouse (to whom the survivor annuity is payable under the Qualified Joint and Survivor Annuity) must consent in writing to the waiver election, acknowledging the effect of the election and such consent must be witnessed by a Notary Public.

    The Plan Administrator may accept as valid a waiver election which does not satisfy the spousal consent requirement described above if the Plan Administrator establishes the Participant does not have a spouse, the Plan Administrator is not able to locate the Participant's spouse, or other circumstances exist under which the Secretary of Treasury will excuse the consent requirement.

    The Plan Administrator shall furnish to each Participant and spouse eligible to receive a normal retirement pension a written general description of the Qualified Joint and Survivor Annuity, the Participant's right to make, and the effect of an election to waive the Joint and Survivor Annuity form of benefit, the rights of the Participant's spouse regarding the waiver election.  The written description shall include the financial effect upon the Participant's normal retirement pension (in terms of dollars per pension payment) of making an election not to receive payment in the form of a Qualified Joint and Survivor Annuity.  The Plan Administrator either shall mail or personally deliver the written description at such time to ensure its receipt by the Participant on or about the earlier of:

(a)      The date nine (9) months prior to the Participant's attaining Normal Retirement Age; or

(b)      The later of the date one hundred eighty (180) days prior to the Participant's satisfying the requirements for an early commencement of benefits under Section 4.5 or the date the Participant commences participation in the Plan.

    The Plan Administrator shall provide and prescribe the form for a Participant's written election and the spouse's consent under this Section 4.16.  The election form shall state clearly that the Participant is electing to receive all of his Accrued Benefit under the Plan in a form other than a Qualified Joint and Survivor Annuity.  An election, or revocation of an election, is effective as of the date filed with the Plan Administrator.

ARTICLE V

PLAN FINANCING

    Section 5.1 - Contributions. No contributions shall be required or permitted under the Plan from any Participant.  The Company and any participating Employer shall make contributions in such amounts and at such times as determined by the Company in accordance with a funding method and policy to be established by said Company which will be consistent with the minimum funding standards of ERISA.  Forfeitures arising under this Plan, shall be applied to reduce the cost of the Plan, not to increase the benefits otherwise payable to Participants.

    Section 5.2 - Retirement Fund.  All contributions made by the Company or a participating Employer under this Plan shall be paid to the Investment Manager, or if there is no Investment Manager, then to the corporate agent, or if there is no corporate agent, then to the Trustees and deposited in the Retirement Fund.  All assets of the Retirement Fund, including investment income, shall be retained for the exclusive benefit of Participants and their beneficiaries, shall be used to pay benefits to such persons or to pay administrative expenses to the extent not paid by the Company, and shall not revert or inure to the benefit of the Company.

    Notwithstanding anything herein to the contrary, upon the request of the Company or a participating Employer, a contribution which was conditioned upon qualification of the Plan or any amendment thereof under Section 401(a) of the Internal Revenue Code shall be returned to the Company or participating Employer within one year after the denial of the qualification.

ARTICLE VI

ACTUARY

    Section 6.1 - Appointment and Duties.  The Company shall appoint an individual or a corporation or a firm with at least one individual who is qualified or experienced in
performing actuarial services in the valuation, funding and administration of retirement, pension, or annuity plans and who is an enrolled Actuary as provided under ERISA to serve as the Actuary to perform the services set forth herein and to perform such additional services  with respect thereto as may be conferred by the Company and as are consistent with the provisions of the Plan.  All determinations of Actuarial Equivalent values permitted or required to be made under the Plan or otherwise shall be made only in accordance with the advice of the Actuary, and the rules, regulations, and tables relating thereto shall become effective only with the approval of the Actuary.

    Section 6.2 - Successors.  The Company shall have the right at any time to remove the Actuary then acting, to appoint a successor or successors, and to fill vacancies in the office of the Actuary.

ARTICLE VII

ADMINISTRATION

    Section 7.1 - Allocation of Responsibility Among Fiduciaries for Plan and Retirement Fund Administration.  The Fiduciaries shall have only those specified powers, duties, responsibilities and obligations as are specifically given to them under this Plan or the Retirement Fund.  In general, the Company and any participating Employers shall have the sole responsibility for making the contributions necessary to provide benefits under the Plan as specified in Article VII.

    The Trustees shall have the sole responsibility for the administration of the Plan and Retirement Fund and the management of the assets held under the Retirement Fund, all as specifically provided in the Retirement Fund.  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 Retirement Fund, 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 Retirement Fund, and is not required under this Plan or the Retirement Fund to inquire into the propriety of any such direction, information or action.  It is intended under this Plan and the Retirement Fund  that each Fiduciary shall be responsible for the proper exercise of its own powers, duties, responsibilities and obligations under this Plan and the Retirement Fund and shall not be responsible for any act or failure to act of another Fiduciary.  No Fiduciary guarantees the Retirement Fund in any manner against investment loss or depreciation in asset value.

    Section 7.2 - Facility of Payment.  Whenever, in the Trustees' opinion, a person entitled to receive any payment of a benefit or installment thereof hereunder is under a legal disability or is incapacitated in any way so as to be unable to manage his financial affairs, the Trustees may direct payments to such person or to his legal representative or to a relative or friend of such person for his benefit, or the Trustees may apply the payment for the benefit of such person in such manner as the Trustees consider advisable.  Any payment of a benefit or installment thereof in accordance with the provisions of this Section shall be a complete discharge of any liability for the making of such payment under the provisions of the Plan.

    Section 7.3 - Discretionary Authority.  The Plan Administrator appointed by the Trustees pursuant to this document shall have the discretion and authority to make all decisions necessary and useful to interpret and administer this Plan.  Decisions of the Plan Administrator shall be final and binding.  The Plan Administrator shall have the power to delegate any and all responsibility for administering the Plan.  However, such delegation shall not relieve the Plan Administrators of its responsibilities under this Plan.

ARTICLE VIII

MISCELLANEOUS

    Section 8.1 - Non-Guarantee of Employment.  Nothing contained in this Plan shall be construed as a contract of employment between the Company or the Employer and any Eligible Employee, or as a right of any Eligible Employee to be continued in the employment of the Company or the Employer, or as a limitation of the right of the Company of the Employer to discharge any of its employees, with or without cause.

    Section 8.2 - Rights to Retirement Fund Assets.  No Eligible Employee shall have any right to, or interest in, any assets of the Retirement Fund upon Termination of Employment or otherwise, except as provided from time to time under this Plan, and then only to the extent of the benefits payable under the Plan to such employee out of the assets of the Retirement Fund.  In case of termination or partial termination of this Plan, the rights of all affected Participants to their Accrued Benefit to the extent funded as of the date of such termination or partial termination, shall be nonforfeitable.  Except as otherwise may be provided under Title IV of ERISA, all payments of benefits as provided for in this Plan shall be made solely out of the assets of the Retirement Fund and none of the Fiduciaries shall be liable therefor in any manner.

    Section 8.3 - Non-Alienation of Benefits.  Subject to Section 8.4, benefits payable under this Plan shall not be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, charge, garnishment, execution or levy of any kind, either voluntary or involuntary, including any such liability which is for alimony or other payments for the support of a spouse or former spouse or for any other relative of the Participant, prior to actually being received by the person entitled to the benefit under the terms of the Plan; and any attempt to anticipate, alienate, sell, transfer, assign, pledge, encumber, charge or otherwise dispose of any right to benefits payable hereunder, shall be void.  The Retirement Fund shall not in any manner be liable for, or subject to, the debts, contracts, liabilities, engagements or torts of any person entitled to benefits hereunder.

    Section 8.4 - Distributions Under Domestic Relations Orders.  Nothing contained in this Plan shall prevent the Trustees and the Plan Administrator from complying with the provisions of a qualified domestic relations order (as defined in Code §414(p)).

    The Plan Administrator shall establish reasonable procedures to determine the qualified status of a domestic relations order.  Upon receiving a domestic relations order, the Plan Administrator promptly shall notify the Participant and any alternate payee named in the order, in writing, of the receipt of the order and the Plan's procedures for determining the qualified status of the order.  Within a reasonable period of time after receiving the domestic relations order, the Plan Administrator shall determine the qualified status of the order and shall notify the Participant and each alternate payee, in writing, of its determination.  The Plan Administrator shall provide notice under this paragraph by mailing to the individual's address specified in the domestic relations order, or in a manner consistent with Department of Labor regulations.  The Plan Administrator may treat as qualified any domestic relations order entered prior to January 1, 1985, irrespective of whether it satisfies all the requirements described in Code §414(p).

    If any portion of the Participant's nonforfeitable Accrued Benefit is payable during the period the Plan Administrator is making its determination of the qualified status of the domestic relations order, the Trustees shall segregate the amounts payable in a separate account and invest the segregated account solely in fixed income investments.  If the Plan Administrator determines the order is a qualified domestic relations order within eighteen (18) months of receiving the order, the Trustees shall distribute the segregated account in accordance with the order.  If the Plan Administrator does not make its determination of the qualified status of the order within eighteen (18) months after receiving the order, the Trustees shall distribute the segregated account in the manner the Plan would distribute if the order did not exist and shall apply the order prospectively if the Plan Administrator later determines the order is a qualified domestic relations order.

    The Trustees shall make any payments or distributions required under this Section 8.4 by separate benefit checks or other separate distribution to the alternate payee(s).

ARTICLE IX

AMENDMENTS

    Section 9.1 - Amendment.  The Trustees may amend or modify this Plan at any time provided no amendment shall be adopted which alters the basic purpose of this Plan or the Retirement Fund; conflicts with the terms of any Collective Bargaining Agreement or with any applicable law; causes the use or diversion of any part of the Retirement Fund for purposes other than those authorized herein; increases the burdens or obligations of the Company or causes a reversion of any of the assets of the Retirement Fund to the Company or to the Union.  Furthermore, the Trustees and Plan Administrator shall neither enact nor apply any amendment to the Plan to reduce a Participant's Accrued Benefit immediately before the effective date of the amendment, except to the extent permitted under Code §412(c)(8).  An amendment adopted after July 30, 1984, decreases a Participant's Accrued Benefit determined immediately prior to the adoption date if the amendment has the effect of either (1) eliminating or reducing an early retirement benefit or a retirement-type subsidy (as defined in Treasury regulations), or (2) except as provided by Treasury regulations, eliminating an optional form of benefit.  The Plan Administrator shall disregard an amendment described in the immediately preceding sentence to the extent application of the amendment would decrease the Participant's Accrued Benefit determined immediately prior to the adoption date of the amendment.

ARTICLE X

SUCCESSOR COMPANY AND MERGER OR CONSOLIDATION OF PLANS

    Section 10.1 - Successor Company.  In the event of the dissolution, merger, consolidation or reorganization of the Company, provision may be made by which the Plan and Retirement Fund will be continued by the successor; and, in that event, such successor shall be substituted for the Company under the Plan.  The substitution of the successor shall constitute an assumption of Plan Liabilities by the successor and the successor shall have all the powers, duties, and responsibilities of the Company under the Plan.

    Section 10.2 - Plan Assets.  In the event of any merger or consolidation of the Plan with, or transfer in whole or in part of the assets and liabilities of the Retirement Fund to another Trust Fund held under, any other plan of deferred compensation maintained or to be established for the benefit of all or some of the Participants of this Plan, the assets of the Retirement Fund applicable to such Participants shall be transferred to the other Retirement Fund only if:

(a)      each Participant would (if either this Plan or the other plan then terminated) 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 before the merger, consolidation or transfer (if this Plan had then terminated);

(b)      resolutions of the Board of Directors of the Company under this Plan, and of any new or successor company of the affected Participants, shall authorize such transfer of assets; and, in the case of the new or successor company of the affected Participants, its resolutions shall include an assumption of liabilities with respect to such Participants' inclusion in the new company's plan; and

(c)      such other plan and trust are qualified under Sections 401(a) and 501(a) of the Internal Revenue Code.

ARTICLE XI

TOP HEAVY PROVISIONS

    Section 11.1 - Top Heavy Plan Requirements.  With respect to any portion of this Plan which covers Participants who are not covered by the Collective Bargaining Agreement ("Non-Bargaining Unit Participants"), for any Top Heavy Plan Year, the Plan shall provide the special vesting requirements of Code Section 416(b) pursuant to Section 11.3 of the Plan and the special minimum benefit requirements of Code Section 416(c) pursuant to Section 11.4 of the Plan.

    Section 11.2 - Determination of Top Heavy Status.

(a)      The portion of this Plan benefitting the Non-Bargaining Unit Participants shall be a Top Heavy Plan for any Plan Year commencing after December 31, 1982 in which, as of the Determination Date, (1) the Present Value of Accrued Benefits of Key Employees and (2) the sum of the Aggregate Accounts of Key Employees under this Plan and all plans of an Aggregation Group, exceeds sixty percent (60%) of the Present Value of Accrued Benefits and the Aggregate Accounts of all Key and Non-Key Employees under this Plan and all plans of an Aggregation Group.

    If any Participant is a Non-Key Employee for any Plan Year, but such Participant was a Key Employee for any prior Plan Year, such Participant's Present Value of Accrued Benefit and/or Aggregate Account balance shall not be taken into account for purposes of determining whether this Plan is a Top Heavy or Super Top Heavy Plan (or whether any Aggregation Group which includes this Plan is a Top  Heavy Group).  In addition, for Plan Years beginning after December 31, 1984, if a Participant or Former Participant has not performed any services for any Employer maintaining the Plan at any time during the five year period ending on the Determination Date, any accrued benefit for such Participant or Former Participant shall not be taken into account for the purposes of determining whether this Plan is a Top Heavy or Super Top Heavy Plan.

(b)      This Plan shall be a Super Top Heavy Plan for any Plan Year commencing after December 31, 1983 in which, as of the Determination Date, (1) the Present Value of Accrued Benefits of Key Employees and (2) the sum of the Aggregate Accounts of Key Employees under this Plan and all plans of an Aggregation Group, exceeds ninety percent (90%) of the Present value of Accrued Benefits and the Aggregate Accounts of all Key and Non-Key Employees under this Plan and all plans of an Aggregation Group.

(c)      Aggregate Account: A Participant's Aggregate Account as of the Determination Date shall be determined under applicable provisions of the defined contribution plan used in determining Top Heavy Plan status.

(d)      "Aggregation Group" means either a Required Aggregation Group or a Permissive Aggregation Group as hereinafter determined.

(1)      Required Aggregation Group: In determining a Required Aggregation Group hereunder, each plan of the Employer in which a Key Employee is a participant in the Plan Year containing the Determination Date or any of the four preceding Plan years, and each other plan of the Employer which enables any plan in which a Key Employee participates to meet the requirements of Code Sections 401(a)(4) or 410, will be required to be aggregated.  Such group shall be known as a Required Aggregation Group.

In the case of a Required Aggregation Group, each plan in the group will be considered a Top Heavy Plan if the Required Aggregation Group is a Top Heavy Group.  No plan in the Required Aggregation Group will be considered a Top Heavy Plan if the Required Aggregation Group is not a Top Heavy Group.

(2)      Permissive Aggregation Group: The Employer may also include any other plan not required to be included in the Required Aggregation Group, provided the resulting group, taken as a whole, would continue to satisfy the provisions of Code Sections 401(a)(4) and 410.  Such group shall be known as a Permissive Aggregation Group.

In the case of a Permissive Aggregation Group, only a plan that is part of the Required Aggregation Group will be considered a Top Heavy Plan if the Permissive Aggregation Group is a Top Heavy Group.  No plan in the Permissive Aggregation Group will be considered a Top Heavy Plan if the Permissive Aggregation Group is not a Top Heavy Group.

(3)      Only those plans of the Employer in which the Determination Dates fall within the same calendar year shall be aggregated in order to determine whether such plans are Top Heavy Plans.

(4)      An Aggregation Group shall include any terminated plan of the Employer if it was maintained within the last five (5) years ending on the Determination Date.

(e)      "Determination Date" means (a) the last day of the preceding Plan Year, or (b) in the case of the first Plan Year, the last day of such Plan Year.

(f)       "Present Value of Accrued Benefit:" In the case of a defined benefit plan, a Participant's Present Value of Accrued Benefit shall be determined:

(1)      In the case of a Participant other than a Key Employee, using the single accrual method used for all plans of the Employer and Affiliated Employers, or if no such single method exists, using a method which results in benefits accruing not more rapidly than the slowest accrual rate permitted under Code Section 411(b)(1)(C).

(2)      As of the most recent "accrual valuation date", which is the most recent valuation date within a twelve (12) month period ending on the Determination Date.

(3)      For the first Plan Year, as if (a) the Participant terminated service as of the Determination Date; or (b) the Participant terminated service as of the actuarial valuation date, but taking into account the estimated Accrued Benefits as of the Determination Date.

(4)      For the second Plan Year, the Accrued Benefit taken into account for a current participant must not be less than the Accrued Benefit taken into account for the first Plan Year unless the difference is attributable to using an estimate of the Accrued Benefit as of the Determination Date for the first Plan year and using the actual Accrued Benefit for the second Plan Year.

(5)      For any other Plan Year, as if the Participant terminated service as of the actuarial valuation date.

(6)      The actuarial valuation date must be the same date used for computing the defined benefit plan minimum funding costs, regardless of whether a valuation is performed that Plan Year.

(g)      The calculation of a Participant's Present Value of Accrued Benefit as of a Determination Date shall be the sum of:

(1)      The Present Value of Accrued Benefit using the actuarial assumptions of Section 2.4, which assumptions shall be identical for all defined benefit plans being tested for Top Heavy Plan status.

(2)      Any Plan distributions made within the Plan Year that includes the Determination Date or within the four (4) preceding Plan Years.  However, in the case of distributions made after the valuation date and prior to the Determination Date, such distributions are not included as distributions for top heavy purposes to the extent that such distributions are already included in the Participant's Present Value of Accrued Benefit as of the valuation date.  Notwithstanding anything herein to the contrary, all distributions, including distributions made prior to January 1, 1984, and distributions under a terminated plan which if it had not been terminated would have been required to be included in an Aggregation Group, will be counted.  Further, benefits paid on account of death, to the extent such benefits do not exceed the Present Value of Accrued Benefits existing immediately prior to death, shall be treated as distributions for the purposes of this paragraph.

(3)      Any Employee contributions, whether voluntary or mandatory.  However, amounts attributable to tax deductible Qualified Voluntary Employee Contributions shall not be considered to be a part of the Participant's Present Value of Accrued Benefit.

(4)      With respect to unrelated rollovers and plan-to-plan transfers (ones which are both initiated by the Employee and made from a plan maintained by one employer to a plan maintained by another employer), if this Plan provides the rollovers or plan-to-plan transfers, it shall always consider such rollovers or plan-to-plan transfers as a distribution for the purposes of this Section.  If this Plan is the plan accepting such rollovers or plan-to-plan transfers, it shall not consider such rollovers or plan-to-plan transfers accepted after December 31, 1983, as part of the Participant's Present Value of Accrued Benefit.  However, rollovers or plan-to-plan transfers accepted prior to January 1, 1984, shall be considered as part of the Participant's Present Value of Accrued Benefit.

(5)      With respect to related rollovers and plan-to-plan transfers (ones either not initiated by the Employee or made to a plan maintained by the same employer), if this Plan provides the rollovers or plan-to-plan transfers, it shall not be counted as a distribution for purposes of this Section.  If this Plan is the plan accepting such rollovers or plan-to-plan transfers, it shall consider such rollovers or plan-to-plan transfers as part of the Participant's Present Value of Accrued Benefit, irrespective of the date on which such rollovers or plan-to-plan transfers are accepted.

(6)      For the purposes of determining whether two employers are to be treated as the same employer in (4) and (5) above, all employers aggregated under Code Section 414(b), (c), (m) or (o) are treated as the same employer.

(h)      "Top Heavy Group" means an Aggregation Group in which, as of the Determination Date, the sum of:

(1)      The Present Value of Accrued Benefits of Key Employees under all defined benefit plans included in the group, and

(2)      The Aggregate Accounts of Key Employees under all defined contribution plans included in the group, exceeds sixty percent (60%) of a similar sum determined for all Participants.

(i)       "Aggregate Account" means, with respect to each Participant, the value of all accounts maintained on behalf of a Participant, whether attributable to Employer or Employee contributions, used to determine Top Heavy Plan status under the provisions of a defined benefit contribution plan included in any Aggregation Group (as defined in this Plan).

(j)       "Key Employee" means an Employee as defined in Code Section 416(i) and the Regulations thereunder.  Generally, any Employee or former Employee (as well as each of his Beneficiaries) is considered a Key Employee if he, at any time during the Plan Year that contains the "Determination Date" or any of the preceding four (4) Plan Years, has been included in one of the following categories:

(1)      An officer of the Employer (as that term is defined within the meaning of the Regulations under Code Section 416) having annual "415 Compensation" greater than 50 percent of the amount in effect under Code Section 415(b)(1)(A) for any such Plan Year.

(2)      One of the ten employees having annual "415 Compensation" from the Employer for a Plan Year greater than the dollar limitation in effect under Code Section 415(c)(1)(A) for the calendar year in which such Plan Year ends and owning (or considered as owning within the meaning of Code Section 318) both more than one-half percent interest and the largest interests in the Employer.

(3)      A "five percent owner" of the Employer.  "Five percent owner" means any person who owns (or is considered as owning within the meaning of Code Section 318) more than five percent (5%) of the outstanding stock of the Employer or stock possessing more than five percent (5%) of the total combined voting power of all stock of the Employer or, in the case of any unincorporated business, any person who owns more than five percent (5%) of the capital or profits interest in the Employer.  In determining percentage ownership hereunder, employers that would otherwise be aggregated under Code Sections 414(b), (c), (m) and (o) shall be treated as separate employers.

(4)      A "one percent owner" of the Employer having an annual "415 Compensation" from the Employer of more than $150,000.  "One percent owner" means any person who owns (or is considered as owning within the meaning of Code Section 318) more than one percent (1%) of the outstanding stock of the Employer or stock possessing more than one percent (1%) of the total combined voting power of all stock of the Employer or, in the case of an unincorporated business, any person who owns more than one percent (1%) of the capital or profits interest in the Employer.  In determining percentage ownership hereunder, employers that would otherwise be aggregated under Code Sections 414(b), (c), (m) and (o) shall be treated as separate employers.  However, in determining whether an individual has "415 Compensation" of more than $150,000, "415 Compensation" from each employer required to be aggregated under Code Sections 414(b), (c), (m) and (o) shall be taken into account.

For purposes of this Section, the determination of "415 Compensation" shall be made by including amounts that would otherwise be excluded from a Participant's gross income by reason of the application of Code Sections 125, 402(a)(8), 402(h)(1)(B) and, in the case of Employer contributions made pursuant to a salary reduction agreement, by including amounts that would otherwise be excluded from a Participant's gross income by reason of the application of Code Section 403(b).

(k)      "Non-Key Employee" means any Employee or former Employee (and his Beneficiaries) who is not a Key Employee.

(l)       "Super Top Heavy Plan" means a plan described in Section 11.2.

(m)     "Top Heavy Plan" means a plan described in Section 11.2.

(n)      "Top Heavy Plan Year" means a Plan Year commencing after December 31, 1983 during which a portion of the Plan is a Top Heavy Plan.

    Section 11.3 - Vesting if a Portion of the Plan Becomes Top Heavy.

    Notwithstanding the vesting otherwise provided for in the Plan for any Top Heavy Plan Year, the Vested portion of the Accrued Benefit of any Non-Bargaining Unit Participant who has an Hour of Service after the Plan becomes top heavy shall be a percentage of such Participant's number of years of Service according to the following schedule:

Vesting Schedule

Years of Service                    Percentage

  0-2                                         0%

      3                                     100%

    If in any subsequent Plan Year, the portion of the Plan benefiting Non-Bargaining Unit Participants ceases to be a Top Heavy Plan, the Administrator shall revert to the vesting schedule in effect before this Plan became a Top Heavy Plan.  Any such reversion shall be treated as a Plan amendment pursuant to the terms of the Plan.

    Section 11.4 - Minimum Benefit Requirement If a Portion of the Plan Becomes Top Heavy.

(a)      The minimum Accrued Benefit derived from Employer contributions to be provided under this Section for each Non-Key Employee who is a Non-Bargaining Unit Participant during a Top Heavy Plan Year shall equal the product of (1) one-twelfth (1/12th) of "415 Compensation" averaged over the five (5) consecutive "limitation years" (or actual number of "limitation years", if less) which produce the highest average and (2) the lesser of (i) two percent (2%) multiplied by Plan Years of Service or (ii) twenty percent (20%).

(b)      For purposes of providing the minimum benefit under Code Section 416, a Non-Key Employee who is not a Non-Bargaining Unit Participant solely because (1) his Compensation is below a stated amount or (2) he declined to make mandatory contributions to the plan will be considered to be a Participant.  Furthermore, such minimum benefit shall be provided regardless of whether such Non-Key Employee is employed on a specified date.

(c)      For purposes of this Section, Plan years of Service for any Plan Year beginning before January 1, 1984, or for any Plan Year during which the Plan was not a Top Heavy Plan shall be disregarded.

(d)      For purposes of this Section, "415 Compensation" for any "limitation year" ending in a Plan Year which began prior to January 1,1984, subsequent to the last "limitation year" during which the Plan is a Top Heavy Plan, or in which the Participant failed to complete a Plan Year of Service, shall be disregarded.

(e)      For the purposes of this Section, "415 Compensation" shall be limited to $200,000 (unless adjusted in such manner as permitted under Code Section 415(d)).  However, for Plan Years beginning prior to January 1, 1989, the $200,000 limit shall apply only for Top Heavy Plan Years and shall not be adjusted.

(f)       If the Plan provides for the Normal Retirement Benefit to be paid in a form other than a single life annuity, the Accrued Benefit under this Section shall be the Actuarial Equivalent of the minimum Accrued Benefit under (a) above pursuant to Section 2.3.

(g)      If payment of the minimum Accrued Benefit commences at a date other than Normal Retirement Date, the minimum Accrued Benefit shall be the Actuarial  Equivalent of the minimum Accrued Benefit commencing at Normal Retirement Date pursuant to Section 2.3.

(h)      To the extent required to be nonforfeitable under this Plan, the minimum Accrued Benefit under this Section may not be forfeited under Code Section 411(a)(3)(B) or Code Section 411(a)(3)(D).

ARTICLE XII

RESTRICTIONS ON BENEFITS PAYABLE TO HIGHLY

COMPENSATED PARTICIPANTS

    Section 12.1 - IRS Limitations.  This Article sets forth limitations required by the Internal Revenue Service on the pension benefits payable to certain Participants.  It shall apply to a Participant only if his anticipated annual pension exceeds $1,500.00 and the Participant was among the 25 highest paid employees of the Company on (a) January 1, 1973; or (b) the date of the most recent amendment which substantially increased pension benefits (a "Substantive Amendment Date").  The limitations set forth in this Article shall become applicable if:

(a)      The Plan is terminated within ten years after January 1, 1973 (or a Substantive Amendment Date, if applicable);

(b)      The Pension of a Participant becomes payable within such ten year period, or

(c)      The Pension of a Participant becomes payable after such ten year period and the full current costs for the ten year period have not been funded.

    If subparagraph (b) above is applicable, the restrictions shall remain in effect until the later of the expiration of the ten year period or the date on which the full current costs have been funded.

    If a Participant is subject to the provisions of this Article, the Pension payable to him shall not exceed the Pension which can be provided from the greatest of the following:

(a)      The Company's contributions (or funds attributable thereto) which would have been applied to provide benefits for the Participant if the Plan had not been amended on the Substantive Amendment Date and had not continued without change;

(b)      $20,000.00; or

(c)      The sum of (1) the Company's contributions (or funds attributable thereto) which would have been applied to provide benefits for the Participant if the Plan had been terminated on the day before the Substantive Amendment Date (if applicable) and (2) an amount computed by multiplying the number of years for which the current costs of the Plan have been met after January 1, 1973 (or the Substantive Amendment Date, if applicable), by 20% of the first $50,000.00 of the Participant's average annual compensation during his last 5 years of employment.

    The limitations described above may be exceeded for the purposes of making current benefit payments to retired Participants who would otherwise be subject to such restrictions, provided that (a) the contributions which may be used for any such retired Participant in accordance with the restrictions heretofore indicated are applied to provide either a level amount of pension in the basic form of benefit provided for under the Plan for such Participant, or a level amount of pension in an optional form of benefit not greater in amount than the level amount of Pension under the basic form of benefit, and (b) the pension thus provided is supplemented by monthly payments to the extent necessary to provide the full pension in the basic form called for by the Plan, and (c) such supplemental payments are made only if the full current costs of the Plan have been met or if the aggregate of such supplemental payments for all such retired Participants does not exceed the aggregate Company contributions already made under the Plan in the year then current.

    The limitations in this Article shall automatically become inoperative and of no effect upon a ruling by the Internal Revenue Service that they are not required.

ARTICLE XIII

PLAN TERMINATION

    Section 13.1 - Right to Terminate.  In accordance with the procedures set forth in this Article, the Company and the Union have the right to terminate the Plan at any time.  In the event of the dissolution, merger, consolidation or reorganization of the Company, the Plan shall terminate and the Retirement Fund shall be liquidated unless the Plan is continued by a successor to the Company in accordance with Section 10.1.  Subject to applicable requirements, if any, of ERISA governing termination of "Employee Pension Benefit Plans," the Trustees shall liquidate the Retirement Fund in accordance with the provisions of this Article.

    Section 13.2 - Partial Termination.  Upon termination of the Plan with respect to a group of Participants which constitutes a partial termination of the Plan, the Trustees shall allocate for the benefit of the Eligible Employees then or theretofore employed by the Employer with respect to which the Plan is being terminated the proportionate interest of such Participants in the Retirement Fund in the manner and the order set forth in Section 4044 of ERISA.  The Actuary shall make this determination on the basis of the contributions made by the Company, the provisions of this Article, and such other considerations as the Actuary deems appropriate.  The Fiduciaries shall have no responsibility with respect to the determination of any such proportionate interest.

    Section 13.3 - Liquidation of Retirement Fund.  Upon termination of the Plan, or upon termination of employment of a group of Participants constituting a partial termination of the Plan, each such Participant's Accrued Benefit, based on his Accrual Service prior to the date of termination shall become fully vested and nonforfeitable to the extent funded.  Upon complete termination of the Plan, the assets of the Retirement Fund shall be liquidated (after provision is made for the expenses of liquidation), subject to the requirements of PBGC by the payment or provision for the payment of benefits in the following order of preference:

(a)      Certain Benefits Payable Three Years Prior to Termination: The available assets of the Retirement Fund shall first be allocated to provide pensions that became payable three or more years before the effective date of Plan termination, or that could have become payable at the beginning of such three year period had the Participant not deferred the commencement of his Pension by failing to elect earlier commencement, or that could have become payable had a Participant's retirement occurred immediately prior to the beginning of such three year period, provided that:

(i)       The portion of the pension payable to a Participant or the beneficiary of a Participant (or that could have been payable) shall be based on the provisions of the Plan in effect five years prior to the effective date of Plan termination; and for this purpose, the first Plan Year in which an amendment became effective, or was adopted, if later, shall constitute the first year an amendment was in effect; and further provided that:

(ii)      If the pension payable under the Plan had been reduced, either by amendment or due to the form in which the pension is being paid, during the three year period ending on the effective date of Plan termination, then the lowest benefit in pay status during such three year period shall be considered the benefit in pay status for purposes of this category (a).

(b)      Other Benefits Eligible for Termination Insurance: To the extent that the amount of a pension has not been provided in the foregoing category (a), the remaining assets shall be allocated to provide any pension provided under the Plan for a Participant whose employment terminated prior to the effective date of Plan termination, or any immediate or deferred pension that would have been payable to or on behalf of a Participant had his employment terminated for a reason other than death on the effective date of Plan termination, provided that the amount of a pension to be provided under this category (b) shall be determined as follows:

(i)       The portion of the pension payable to a Participant or the beneficiary of a Participant (or that could have been payable) based on the provisions of the Plan in effect five years prior to the effect date of Plan termination; and for this purpose, the first Plan Year in which an amendment became effective, or was adopted, if later, shall constitute the first year an amendment was in effect; plus

(ii)      The portion of the pension payable to a Participant or the beneficiary of a Participant which would have been included in (i) above had the Plan or a Plan amendment been in effect five years prior to the effective date of Plan termination, determined as follows: 20% for each Plan Year (less than five) that the Plan or an amendment thereto was in effect, multiplied by the amount that would have been included under subparagraph (1) for such Participant or beneficiary had the Plan or the  amendment been in effect for five Plan Years as of the effective date of Plan termination;

(iii)     No benefit payable under this category (b) to a Participant or beneficiary shall exceed an amount with an actuarial value of a monthly benefit in the form of a life only annuity commencing at age 65 equal to $750.00 multiplied by a fraction, the numerator of which is the contribution and benefit base determined under Section 230 of the Social Security Act in effect at the effective date of Plan termination and the denominator of which is such contribution and benefit base in effect in calendar year 1974.

(c)      Other Vested Benefits: To the extent that the amount of a pension has not been provided in the foregoing categories (a) and (b), the remaining assets in the Retirement Fund shall be allocated to provide the benefit payable under the Plan to or on behalf of a Participant whose employment terminated prior to the effective date of Plan termination, or that would have been payable to or on behalf of a Participant had his employment terminated for a reason other than death on the effective date of Plan termination, in the following order of preference:

(i)       to any Participant who had retired under Section 4.1 prior to the effective date of Plan termination or who was eligible to retire under said Section on the effective date of Plan termination;

(ii)      to any Participant who had retired under Section 4.3 prior to the effective date of Plan termination or who was eligible to retire under said Section on the effective date of Plan termination; or

(iii)     to any Participant whose employment had terminated with entitlement to a deferred vested pension under Section 4.4 prior to the effective date of Plan termination or who would have been eligible for a deferred vested pension under said Section had his employment terminated on the effective date of Plan termination.

(d)      Other Benefits: To the extent that the amount of pension has not been provided in the foregoing categories (a), (b) and (c), the remaining assets shall be allocated to provide the benefit accrued under the Plan, without regard to the satisfaction of the vesting requirements of this Plan, with respect to each Participant whose employment had not terminated as of the effective date of Plan termination, according to the respective actuarial value of each such Participant's Accrued Benefit.

    If the assets of the Retirement Fund applicable to any of the above categories are insufficient to provide full benefits for all persons in such group, the benefits otherwise payable to such persons shall be reduced proportionately.  The Actuary shall calculate the allocation of the assets of the Retirement Fund in accordance with the above priority categories, and certify his calculations to the Fiduciaries.  No liquidation of assets and payment of benefits (or provision therefor) shall actually be made by the Trustee until after it is advised by the Company in writing that applicable requirements, if any, of ERISA governing termination of "Employee Pension Benefit Plans" have been, or are being complied with or that appropriate authorizations, waivers, exemptions or variances have been, or are being, obtained.

    Section 13.4 - Manner of Distribution.  Subject to the foregoing provisions of Article XIII and applicable PBGC rules, any distribution after termination of the Plan may be made, in whole or in part, to the extent that no discrimination in value results, in cash, in securities or other assets in kind, or in non-transferable annuity contracts, as the Trustees, in their discretion, shall determine.

    Section 13.5 - Residual Amounts.  In no event shall the Company or any participating Employer receive any amounts from the Retirement Fund upon termination of the Plan.  After satisfaction of all liabilities of the Plan, any amounts which remain shall be distributed to Participants according to the following formula: To each Participant, a fraction of the Retirement Fund's residual assets equal to the fraction attained when the numerator is the Participant's total Years of Accrual Service and the denominator is the total years of Accrual Service for all Participants in the Plan.

ARTICLE XIV

CONSTRUCTION

    Section 14.1 - Construction.  The masculine gender, where appearing in the Plan, shall be deemed to include the feminine gender, and the singular may include the plural, unless the context clearly indicates to the contrary.  The words "hereof", "herein", "hereunder", and other similar compounds of the word "here" shall mean and refer to the entire Plan, not to any particular provision or Section.

    Section 14.2 - Authority of Trustees: In discharging the duties assigned to them under this Plan, the Trustees and, to the extent authority has been delegated to the Plan Administrator and his or her delegates, all of such persons and his or her delegates have the discretion and final authority to interpret and construe the terms of the Plan; to determine coverage and eligibility for benefits under the Plan; and to make all other determinations deemed necessary or advisable for the discharge of their duties or the administration of the Plan.  The discretionary authority of the Trustees, the Plan Administrator and their respective delegates is final, absolute, conclusive and exclusive, and binds all parties so long as it is exercised in good faith.  It is specifically intended that judicial review of any decision of the Trustees, the Plan Administrator or their delegates be limited to the arbitrary and capricious standard of review.

GRAPHIC COMMUNICATIONS                           BMC INDUSTRIES, INC.

INTERNATIONAL UNION, TWIN                        

CITIES LOCAL 6A

By: /s/C. David Jara                                                     By: /s/Brad Carlson
 

UNION TRUSTEES:                                                 COMPANY TRUSTEES:

/s/C. David Jara                                                           /s/Wesley S. Cohen

/s/Brian C. Moser                                                        /s/Dennis Malecek

/s/Richard W. Pruden                                                  /s/Brad Carlson

/s/Donald F. Schuldt                                                   /s/Cynthia Wingert

Dated as of this 18th day of June, 2002.

EX-10.48 9 exhibit_10-48.htm  

AMENDMENT 1

TO THE

SEVENTH RESTATED GRAPHIC COMMUNICATIONS

INTERNATIONAL UNION, TWIN CITIES

LOCAL 6A - BUCKBEE-MEARS PENSION PLAN

These amendments reflect the applicable provisions of the model amendments to comply with the Economic Growth and Tax Relief Reconciliation Act of 2001, as amended ("EGTRRA"), released by the Internal Revenue Service in IRS Notice 2001-57, are intended as good faith compliance with the requirements of EGTRRA, and are to be construed in accordance with EGTRRA and guidance issued thereunder.

Pursuant to Article IX of the Seventh Restated Graphic Communications International Union, Twin Cities Local 6A - Buckbee-Mears Pension Plan, hereinafter referred to as the "Plan", the Trustees hereby amend said Plan as follows:

I.

A new subsection 4.14(e) is hereby added to the Plan to read in its entirety as follows:

"(e)    (i)    Effective Date.  Notwithstanding the foregoing to the contrary, this section shall be effective for limitation years ending after December 31, 2001.

(ii)    Effect on Participants.  Benefit increases resulting from the increase in the limitations of section 415(b) of the Code will be provided to all employees participating in this Plan who have one (1) Hour of Service ending after December 31, 2001.

Definitions.

(iii)    Defined benefit dollar limitation.  The "defined benefit dollar limitation" is $160,000, as adjusted, effective January 1 of each year, under section 415(d) of the Code in such manner as the Secretary shall prescribe, and payable in the form of a straight life annuity.  A limitation as adjusted under section 415(d) of the Code will apply to limitation years ending with or within the calendar year for which the adjustment applies.

(iv)Maximum permissible benefit.  The "maximum permissible benefit" is the lesser of the defined benefit dollar limitation or defined benefit compensation limitation (both adjusted where required, as provided in (a) and, if applicable, in (b) or (c) below).

(a)    If the Participant has fewer than 10 years of participation in the Plan, the defined benefit dollar limitation shall be multiplied by a fraction, (i) the numerator of which is the number of years (or part thereof) of participation in the Plan and (ii) the denominator of which is 10.  In the case of a Participant who has fewer than 10 years of service with the employer, the defined benefit compensation limitation shall be multiplied by a fraction, (i) the numerator of which is the number of years (or part thereof) of service with the employer and (ii) the denominator of which is 10.

(b)    If the benefit of a Participant begins prior to age 62, the defined benefit dollar limitation applicable to the Participant at such earlier age is an annual benefit payable in the form of a straight life annuity beginning at the earlier age that is the actuarial equivalent of the defined benefit dollar limitation applicable to the Participant at age 62 (adjusted under (a) above, if required).  The defined benefit dollar limitation applicable at an age prior to age 62 is determined as the lesser of (i) the actuarial equivalent (at such age) of the defined benefit dollar limitation computed using the interest rate and mortality table (or other tabular factor) specified in Section 4.12(a) and (ii) the actuarial equivalent (at such age) of the defined benefit dollar limitation computed using a 5 percent interest rate and the applicable mortality table as defined in Section 4.12(a) of the Plan.  Any decrease in the defined benefit dollar limitation determined in accordance with this paragraph (b) shall not reflect a mortality decrement if benefits are not forfeited upon the death of the Participant.  If any benefits are forfeited upon death, the full mortality decrement is taken into account.

(c)    If the benefit of a Participant begins after the Participant attains age 65, the defined benefit dollar limitation applicable to the Participant at the later age is the annual benefit payable in the form of a straight life annuity beginning at the later age that is actuarially equivalent to the defined benefit dollar limitation applicable to the Participant at age 65 (adjusted under (a) above, if required).  The actuarial equivalent of the defined benefit dollar limitation applicable at an age after age 65 is determined as (i) the lesser of the actuarial equivalent (at such age) fo the defined benefit dollar limitation computed using the interest rate and mortality table (or other tabular factor) specified in Section 4.12(a) of the Plan and (ii) the actuarial equivalent (at such age) of the defined benefit dollar limitation computed using a 5 percent interest rate assumption and the applicable mortality table as defined in Section 4.12(a) of the Plan.  For these purposes, mortality between age 65 and the age at which benefits commence shall be ignored.

II.

A new subsection 4.12(c) is hereby added to the Plan to read in its entirety as follows:

"(c)    Effective for distributions made after December 31, 2001, for purposes of the direct rollover provisions of this Section 4.12, an eligible retirement plan shall also mean an annuity contract described in section 403(b) of the Code and an eligible plan under section 457(b) of the Code which is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state and which agrees to separately account for amounts transferred into such plan from this Plan.  The definition of eligible retirement plan shall also apply in the case of a distribution to a surviving spouse, or to a spouse or former spouse who is the alternate payee under a qualified domestic relations order, as defined in section 414(p) of the Code."

III.

Section 11.5 is hereby added to the Plan to read in its entirety as follows:

11.5  Modifications of Top-Heavy Rules effective after December 31, 2001.

(a) Effective date.  This section shall apply for purposes of determining whether the Plan is a top-heavy plan under section 416(g) of the Code for Plan Years beginning after December 31, 2001, and whether the Plan satisfies the minimum benefits requirements of section 416(c) of the Code for such years.  This section amends Article XI of the Plan.

(b)Determination of top-heavy status.

1.    Key employee.  Key employee means any employee or former employee (including any deceased employee) who at any time during the Plan Year that includes the determination date was an officer of the employer having annual compensation greater than $130,000 (as adjusted under section 416(i)(1) of the Code for Plan Years beginning after December 31, 2002), a 5-percent owner of the employer, or a 1-percent owner of the employer having annual compensation of more than $150,000.  For this purpose, annual compensation means compensation of more than $150,000.  For this purpose, annual compensation means compensation within the meaning of section 415(c)(3) of the Code.  The determination of who is a key employee will be made in accordance with section 416(i)(1) of the Code and the applicable regulations and other guidance of general applicability issued thereunder.

2.    Determination of present values and amounts.  This section (b)(2) shall apply for purposes of determining the present values of accrued benefits and the amounts of account balances of employees as of the determination date.

(i)    Distributions during year ending on the determination date.  The present values of accrued benefits and the amounts of account balances of an employee as of the determination date shall be increased by the distributions made with respect to the employee under the Plan and any plan aggregated with the Plan under section 416(g)(2) of the Code during the 1-year period ending on the determination date.  The preceding sentence shall also apply to distributions under a terminated plan which, had it not been terminated, would have been aggregated with the Plan under section 416(g)(2)(A)(i) of the Code.  In the case of a distribution made for a reason other than separation from service, death, or disability, this provision shall be applied by substituting 5-year period for 1-year period.

(ii)    Employees not performing services during year ending on the determination date.  The accrued benefits and accounts of any individual who has not performed services for the employer during the 1-year period ending on the determination date shall not be taken into account.

(c)    Minimum benefits.  For purposes of satisfying the minimum benefit requirements of section 416(c)(1) of the Code and the Plan, in determining years of service with the employer, any service with the employer shall be disregarded to the extent that such service occurs during a Plan Year when the Plan benefits (within the meaning of section 410(b) of the Code) no key employee or former key employee.

IV.

Except as amended herein, the terms and provisions of the Seventh Restated Graphic Communications International Union, Twin Cities Local 6A - Buckbee-Mears Pension Plan, shall be and remain in full force and effect.

V.

This Amendment shall be effective as provided herein.

IN WITNESS WHEREOF, the Trustees have caused this Amendment 1 to the Seventh Restated Graphic Communications International Union, Twin Cities Local 6A - Buckbee-Mears Pension Plan to be executed as of this 30st  day of December, 2002.

GRAPHIC COMMUNICATIONSBMC INDUSTRIES, INC.

INTERNATIONAL UNION, TWIN

CITIES LOCAL 6A

By:  /s/C. David Jara                                       By: /s/Brad Carlson

UNION TRUSTEES:                                           COMPANY TRUSTEES:

/s/C. David Jara                                                   /s/Wesley S. Cohen

/s/Brian C. Moser                                                /s/Dennis Malecek

/s/Richard W. Pruden                                           /s/Brad Carlson

/s/Donald F. Schuldt                                            /s/John Oyen

Dated this 31st day of December, 2002.

EX-21.1 10 exhibit_21-1.htm

EXHIBIT 21-1

SUBSIDIARIES

OF

BMC INDUSTRIES, INC.

1.     Buckbee-Mears Europe GmbH

2.     Buckbee-Mears Hungary Kft.

3.     Buckbee-Mears Medical Technologies, LLC

4.     Vision-Ease Lens, Inc.

5.     Vision-Ease Lens Azusa, LLC

6.     Vision Ease Lens Limited

7.     Vision-Ease Canada, Ltd.

8.     P. T. Vision-Ease Asia, joint venture with P.T. Astron Lensindo Nusa

9.     Buckbee-Mears Holding Company B.V.

10.   Buckbee-Mears European Holding Company B.V.

11.   Buckbee-Mears Deutschland Holding GmbH & Company KG

12.   Vision-Ease France SAS

13.   Vision-Ease Deutschland GmbH

14.   Buckbee-Mears Deutschland Verwaltungs GmbH

15.   Buckbee-Mears Netherlands B.V.

EX-23.1 11 exhibit_23-1.htm

Exhibit 23.1

Consent of Independent Auditors

We consent to the incorporation by reference in the Registration Statement (Form S-8 No. 33-55089) pertaining to the BMC Industries, Inc. 1994 Stock Incentive Plan, in the Registration Statement (Form S-8, No. 33-38684) pertaining to the BMC Industries, Inc. Restated and Amended 1994 Stock Incentive Plan and in the Registration Statement (Form S-8, No. 333-81952) pertaining to the BMC Industries, Inc. Savings and Profit Sharing Plan of our report dated January 31, 2003 with respect to the consolidated financial statements of BMC Industries, Inc. included in the Annual Report (Form 10-K) for the year ended December 31, 2002.

/s/Ernst & Young LLP

Minneapolis, Minnesota

March 25, 2003

EX-99.1 12 exhibit_99-1.htm

EXHIBIT 99.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS 

ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of BMC Industries Inc (the "Company") on Form 10-K for the period ended December 31, 2002 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Douglas C. Hepper, Chief Executive Officer of the Company, certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

     1)       The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

     2)       The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

March 26, 2003

/s/Douglas C. Hepper

Douglas C. Hepper

Chairman, President and

Chief Executive Officer

EX-99.2 13 exhibit_99-2.htm

EXHIBIT 99.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS 

ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of BMC Industries Inc (the "Company") on Form 10-K for the period ended December 31, 2002 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Curtis E. Petersen, Chief Financial Officer of the Company, certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

     1)       The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

     2)       The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

March 25, 2003

/s/Curtis E. Petersen

Curtis E. Petersen

Senior Vice President and

Chief Financial Officer 

-----END PRIVACY-ENHANCED MESSAGE-----

EX-10.3

BMC INDUSTRIES, INC.

SAVINGS AND PROFIT SHARING PLAN

2001 REVISION

First Declaration of Amendment

Pursuant to the retained power of amendment contained in Section 11.2 of the BMC Industries, Inc. Savings and Profit Sharing Plan - 2001 Revision, the undersigned hereby amends the Plan by adding a new Exhibit A thereto in the form attached hereto.

The foregoing amendment is effective as of December 31, 2001.

IN WITNESS WHEREOF, the undersigned has caused this instrument to be executed this 26th day of December, 2001.

                                                                                    BMC INDUSTRIES, INC.

Attest:  /s/Jon A. Dobson                                            By:  /s/Bradley D. Carlson

            Secretary                                                         Its:  Treasurer

BMC INDUSTRIES, INC.

SAVINGS AND PROFIT SHARING PLAN

2001 REVISION

EXHIBIT A

Special Provisions Applicable to

Vision-Ease Lens Azusa, Inc. and Buckbee-Mears Cortland in 2001

Pursuant to Section 14.1(f), this Exhibit A sets forth special provisions of the Plan applicable only to an Active Participant in the Plan who is a Qualified Employee of Vision-Eae Lens Azusa, Inc. or Buckbee-Mears Cortland, a unit of BMC Industries, Inc. and classified by the Participating Employer as being on an unpaid leave of absence on December 31, 2001 (a "Vision-Ease Lens Azusa/Buckbee-Mears Cortland Participant").

1. Notwithstanding Section 3.3(a)(i), a Vision-Ease Lens Azusa/Buckbee-Mears Cortland Participant will be eligible to share in the Participating Employer's Matching Contribution for the calendar quarter ending on December 31, 2001 pursuant to the provisions set forth in Section 3.3(a).
   
   

2. Notwithstanding Section 3.3(b)(i), a Vision-Ease Lens Azusa/Buckbee-Mears Cortland Participant, will be eligible to share in the Participating Employer's Matching Contribution (if any) for the Plan Year ending on December 31, 2001 pursuant to the provisions set forth in Section 3.3(b).
   
   

3. Notwithstanding Section 3.4(b)(i), a Vision-Ease Lens Azusa/Buckbee-Mears Cortland Participant who completed at least 1000 Hours of Service during the Plan Year ending on December 31, 2001, will be eligible to share in the Participating Employer's Profit Sharing Contribution for the Plan Year ending on December 31, 2001 pursuant to the provisions set forth in Section 3.4(b).

EX-10.4

BMC INDUSTRIES, INC.

SAVINGS AND PROFIT SHARING PLAN

2001 revision

Second Declaration of Amendment

Pursuant to the retained power of amendment contained in Section 11.2 of the BMC Industries, Inc. Savings and Profit Sharing Plan - 2001 Revision, the undersigned hereby amends the Plan as described below:

1.               Section 3.3 of the Plan is amended effective January 1, 2002, to read as follows:

"3.3     Matching Contributions. 

(a)       Subject to Subsections (b) and (d) and the limitations described in Article 9, the Participating Employer of an eligible Active Participant will make a Matching Contribution on behalf of the Active Participant for a calendar quarter in an amount equal to:

(i)        100 percent of the amount of the Active Participant's 401(k) Contributions for each calendar quarter up to three percent of the Participant's Eligible Earnings for such calendar quarter, and

(ii)       50 percent of the amount of the Active Participant's 401(k) Contributions for each calendar quarter that exceeds three percent of the Active Participant's Eligible Earnings for such calendar quarter and that does not exceed five percent of the Active Participant's Eligible Earnings for such calendar quarter.

It is intended that such Matching Contributions will be used by the Participating Employer to satisfy the safe harbor provisions of Code sections 401(k)(12) and 401(m)(11).

(b)       To be eligible to share in the Participating Employer's Matching Contribution for a given calendar quarter, a Participant must have, on or before the last day of the calendar quarter, entered the Plan as a Participant for the purposes of having Matching Contributions made on his or her behalf, received Eligible Earnings for the calendar quarter from the Participating Employer and made 401(k) Contributions.

(c)       A Participating Employer's Matching Contributions for a Plan Year will be paid to the Trustee on such date or dates during or following such Plan Year as the Participating Employer may elect but in no case more than 12 months after the end of the Plan Year.  A Participating Employer's Matching Contributions for a calendar quarter that are used to satisfy the safe harbor provisions of Code sections 401(k)(12) and 401(m)(11) will be paid to the Trustee no later than the last day of the following calendar quarter.

(d)       No Matching Contribution will be made with respect to any portion of a Participant's 401(k) Contributions returned to the Participant pursuant to Article 9.  For this purpose, 401(k) Contributions with respect to which no Matching Contributions are made for a Plan Year will be deemed to be the first such contributions returned to the Participant.  If the Administrator determines that Matching Contributions that have been added to a Participant's Account should not have been added by reason of this subsection, the contributions, increased by Fund earnings or decreased by Fund losses attributable to the contributions, as determined under Section 9.5, will be subtracted from the Account as soon as administratively practicable after the determination is made and will be applied to satisfy the contribution obligations of the Participating Employer that made the excess contributions for the Plan Year for which the excess contributions were made.  If, because of the passage of time, the excess cannot be applied in this way, the excess will be allocated, in the discretion of the Administrator:

(i)        among the Matching Contribution Accounts of all Participants who made 401(k) Contributions for the Plan Year as Qualified Employees of the Participating Employer in proportion to such 401(k) Contributions up to six percent of Eligible Earnings; or

(ii)       as a corrective contribution pursuant to Section 3.6.

(e)       Notwithstanding any other provision of this section to the contrary, a Participant covered by a collective bargaining agreement between his or her bargaining representative and a Participating Employer is eligible for Matching Contributions only if and to the extent provided in the collective bargaining agreement.

(f)        No Matching Contributions will be made with respect to After-Tax Contributions."

2.               Section 3.4(a) of the Plan is amended effective January 1, 2002, to read as follows:

"(a)      Each Participating Employer may make a Profit Sharing Contribution for a Plan Year on behalf of a Participant who has satisfied the eligibility conditions specified in Subsection (b) for a Plan Year in an amount (if any) equal to the sum of:

(i)        a percentage (if any) determined by the Participating Employer's Board for the Plan Year of the aggregate Eligible Earnings for the Plan Year of all Participants eligible to share in the contribution for the Plan Year plus

(ii)       an additional amount, if any, separately determined by the Participating Employer's Board for each of its Participating Business Units based on the annual profit performance of each Participating Business Unit."

3.               Section 3.4(c) of the Plan is amended effective January 1, 2002, to read as follows:

"(c)      Subject to the limitations described in Article 9, a Participating Employer's Profit Sharing Contribution for a Plan Year will be allocated among the Profit Sharing Contribution Accounts of Participants who have satisfied the eligibility conditions under Subsection (b) for the Plan Year as follows:

(i)        The Participating Employer's contribution described in Subsection (a)(i) will be allocated to each eligible Participant as follows:

(1)       a dollar amount equal to 5.7% of the sum of each Participant's Eligible Earnings plus his or her Excess Eligible Earnings; or

(2)       if the Employer contribution is less than the amount in Clause (1) above, then each eligible Participant will be allocated a share of the Participating Employer's Profit Sharing Contribution in the same proportion that the sum of such Participant's Eligible Earnings plus his or her Excess Eligible Earnings for the Plan Year bears to the sum of the Eligible Earnings plus Excess Eligible Earnings of all such eligible Participants; or

(3)       any remaining contribution will be allocated among eligible Participants in the same proportion that each Participant's Eligible Earnings for the Plan Year bears to the total amount of all eligible Participants' Eligible Earnings for that Plan Year.

(ii)       The Participating Employer's contribution described in Subsection (a)(ii) with respect to a given Participating Business Unit will be allocated to each eligible Participant who received Eligible Earnings for the Plan Year with respect to services for the Participating Business Unit (other than administrative services with respect to which he or she is included in the Corporate Participating Business Unit unless the contribution relates to the Corporate Participating Business Unit) in the same manner as under Subsection (c)(i) provided the allocations under this Subsection (c)(ii) are determined after aggregating the contributions allocated under (c)(i) to those participants who are eligible to receive an allocation under this Subsection (c)(ii) and the contributions to be allocated hereunder."

4.               Section 4.1(a)(iii) of the Plan is amended effective January 1, 2002, to read as follows:

"(iii)    A Matching Contribution Account, which will include the balance of his or her employer contribution account under prior provisions of the Plan and to which there will be added any Matching Contributions made on the Participant's behalf, together with a subaccount established and maintained for a Participant in connection with any Matching Contributions made pursuant to Section 3.3(a) that are used to satisfy the designed-based safe harbor alternative described in Code section 401(k)(12) and/or the designed-based safe harbor alternative described in Code section 401(m)(11), as provided under Sections 9.2, 9.3, and 9.4;"

5.               Section 5.1 of the Plan is amended effective February 1, 2002, to read as follows:

"5.1     Establishment of Investment Funds.

(a)       In order to allow each Participant to determine the manner in which his or her Accounts will be invested, the Trustee will maintain, within the Trust, an investment fund designated as the BMC Common Stock Fund and three or more separate investment funds of such nature and possessing such characteristics as the Committee may specify from time to time.  Subject to Section 5.4(b), each Participant's Accounts will be invested in the investment funds in the proportions directed by the Participant in accordance with the procedures set forth in Sections 5.2 and 5.3.  The Committee may, from time to time, direct the Trustee to establish additional investment funds or to terminate any existing investment fund.

(b)       Notwithstanding any other provision of the Plan to the contrary, the Committee may direct the Trustee to suspend Participant investment activity (including such activity in connection with the withdrawals, loans and distributions) in any or all investment funds, or impose special rules or restrictions of uniform application, for a period determined by the Committee to be necessary in connection with:

(i)        the establishment or termination of any investment fund;

(ii)       the receipt by the Trustee from, or transfer by the Trustee to, another trust of account balances in connection with an acquisition or divestiture or otherwise;

(iii)      a change of Trustee, investment manager or recordkeeper; or

(iv)      such other circumstances determined by the Committee as making such suspension or special rules or restrictions necessary or appropriate."

6.               Section 5.4 of the Plan is amended effective February 1, 2002, to read as follows:

"5.4     BMC Common Stock Fund.

(a)       The Trustee will establish, as one of the investment funds under Section 5.1, a fund, designated as the BMC Common Stock Fund, which will be invested in shares of Company Stock except for such amounts of cash as the Committee determines to be necessary to satisfy short-term liquidity requirements and cash held pending acquisition of shares of Company Stock.

(b)       Subject to Subsection (c), all amounts credited to a Participant's Matching Contribution Account prior to January 1, 2002 will be invested only in the BMC Common Stock Fund.

(c)       Notwithstanding Subsection (b) -

(i)        Not more than once each calendar quarter, a Participant who has attained age 55 may elect to transfer all or any portion of his or her Matching Contribution Account from the BMC Common Stock Fund to one or more of the investment funds maintained pursuant to Section 5.1 other than the BMC Common Stock Fund.  The election must be made in accordance with and is subject to Plan Rules and will be effective as soon as administratively practicable after it is received by the Administrator or the Administrator's designate.

(ii)       Not more than once each calendar quarter, a Participant who is an Employee and is not eligible to make directions pursuant to Subsection (c)(i) may elect to transfer up to 25 percent of his or her Matching Contribution Account from the BMC Common Stock Fund to one or more of the investment funds maintained pursuant to Section 5.1 other than the BMC Common Stock Fund.  A Participant may only make an election pursuant to this Subsection (c)(ii) if the portion of the  Participant's Matching Contribution Account, excluding the Matching Contribution subaccount established pursuant to Section 4.1(a)(iii),invested in the BMC Common Stock Fund equals or exceeds 20 percent of the aggregate balance of the Participant's 401(k) Contribution Account, Matching Contribution Account, After-Tax Contribution Account and Rollover Account.  The election must be made in accordance with and is subject to Plan Rules and will be effective as soon as administratively practicable after it is received by the Administrator or the Administrator's designate.

(d)       The BMC Qualified Benefits Plan Committee will direct the manner in which the shares of Company Stock represented by Participants' interests in the BMC Common Stock Fund will be voted in connection with any action at which holders of Company Stock are entitled to vote.  In the event of a public tender or exchange offer for shares of Company Stock, the BMC Qualified Benefits Plan Committee will direct whether or not the shares of Company Stock represented by the Participants' interests in the BMC Common Stock Fund will be tendered or exchanged.

(e)       A Participant who is subject to the reporting requirements of section 16 of the Securities Exchange Act of 1934 (the "Exchange Act") with respect to Company Stock may elect to make a transfer pursuant to Section 5.3, a withdrawal or plan loan pursuant to Article 6, a distribution pursuant to Article 8or any other "discretionary transaction," as that term is defined under the Exchange Act, from the portion of his or her Account invested in Company Stock only if both of the following conditions are satisfied.

(i)        The election to make such transfer or application for the withdrawal or distribution must be made within the period between the third and twelfth days, inclusive, following the Company's release of its quarterly or annual financial data in the manner described in Rule 16b-3(e)(1)(ii) of the Exchange Act.  Such election or application will be given effect at the same time as would other elections or applications made at the same time.

(ii)       Such Participant has not made any election to transfer any portion of his or her Account balance from Company Stock or received a withdrawal or distribution from the portion of his or her Account invested in Company Stock within the six-month period immediately preceding the date on which such election is made."

7.               Section 7.1 of the Plan is amended effective January 1, 2002, to read as follows:

"7.1     Vesting. 

(a)       A Participant always has a fully vested nonforfeitable interest in his or her 401(k) Contribution Account, After-Tax Contribution Account, Matching Contribution Account, Rollover Account, Profit Sharing Plan Rollover Account and in the portion of his or her Profit Sharing Contribution Account credited to a subaccount described in Section 3.6.

(b)       A Participant will acquire a fully vested nonforfeitable interest in the portion of his or her Profit Sharing Contribution Account not described in Subsection (a) upon attaining his or her Normal Retirement Date while he or she is, or before he or she became, an Employee.

(c)       A Participant will acquire a fully vested nonforfeitable interest in the portion of his Profit Sharing Contribution Account not described in Subsection (a) if he or she dies or becomes Disabled while he or she is an Employee.

(d)       A Participant will acquire a fully vested nonforfeitable interest in the portion of his or her Profit Sharing Account not described in Subsection (a) upon the Participant's Termination of Employment following the Participant's attainment of age 60 if the sum of his or her age and full years of Vesting Service is at least 65.

(e)       A Participant will acquire a fully vested nonforfeitable interest in the portion of his or her Profit Sharing Contribution Account not described in Subsection (a) if the Affiliated Organization, Participating Business Unit, business unit, location or division at which the Participant is employed, permanently ceases operations or is sold or otherwise transferred through sale of stock or of business and assets, in such manner that it no longer is, or is no longer owned by, an Affiliated Organization.

(f)        A Participant will acquire a fully vested nonforfeitable interest in the portion of his or her Profit Sharing Contribution Account not described in Subsection (a) upon a Change in Control with respect to the Company, which for purposes of this subsection means any of the following:

(i)        The sale, lease, exchange, or other transfer of all or substantially all of the assets of the Company, in one transaction or in a series of related transactions, to any Person;

(ii)       The approval by the stock holders of the Company of any plan or proposal for the liquidation or dissolution of the Company;

(iii)      Any Person is or becomes the "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of 50 percent or more of the combined voting power of the Company's outstanding securities ordinarily having the right to vote at elections of directors;

(iv)      Individuals who constitute the Company's Board of Directors on January 1, 1998 (the "Incumbent Board") cease for any reason to constitute at least a majority thereof, provided that any person becoming a director subsequent to January 1, 1998 whose election, or nomination for election, by the Company's stockholders, was approved by a vote of at least a majority of the directors comprising the Incumbent Board (either by a specific vote or by approval of the proxy statement of the Company in which such person is named as a nominee for director, without objection to such nomination) will, for purposes of this clause (iv), be deemed to be a member of the Incumbent Board; or

(v)       A change in control of a nature that is determined by independent legal counsel to the Company to be required to be reported (assuming such event has not been "previously reported") in response to Item 1(a) of the Current Report on Form 8-K, as in effect on January 1, 1994, pursuant to section 13 or 15(d) of the Exchange Act, whether or not the Company is then subject to such reporting requirement.

For purposes of applying the foregoing, the term "Person" means and includes any individual, corporation, partnership, group, association or other "person," as such term is used in section 14(d) of the Exchange Act, other than the Company, a wholly-owned subsidiary of the Company or any employee benefit plan(s) sponsored by the Company or a wholly-owned subsidiary of the Company.

(g)       A Participant whose Profit Sharing Contribution Account is not otherwise fully vested will acquire a vested nonforfeitable interest in the portion of his or her Profit Sharing Contribution Account not described in Subsection (a) to the extent provided in the following schedule:

Full Years of Vesting Service   Less than Five Years
Five or More Years Vested
Interest

  0%
100 %"

8.               Section 7.2 of the Plan is amended effective January 1, 2002, to read as follows:

"7.2     Forfeiture Upon Distribution.

(a)       If a Participant receives a distribution of the entire vested balance of his or her Accounts after Termination of Employment and before he or she incurs five consecutive One-Year Breaks in Service, the nonvested portions of the Participant's Profit Sharing Contribution Account will, at the time of such distribution, be forfeited.  A Participant who has no vested interest in his or her Profit Sharing Contribution Account when he or she terminates employment will be deemed to have received a distribution of the entire vested balance of the Account at the time of his or her Termination of Employment.

(b)       If a Participant described in Subsection (a) received a distribution of less than the entire balance of his or her Accounts, resumes employment as a Qualified Employee and repays to the Trustee the full amount distributed, other than the portion of the distribution attributable to his or her After-Tax Contribution Account, Rollover Account and Profit Sharing Plan Rollover Account balances, before the earlier of (1) five years following the date of reemployment as a Qualified Employee or (2) the date on which he or she incurs five consecutive One-Year Breaks in Service following the distribution, then, the amount of any forfeitures will be restored to the Participant's Profit Sharing Contribution Account, unadjusted for interest or any change in value occurring after the distribution.  Such restoration will be made from forfeitures that arise for the Plan Year for which such restoration is to be made.  To the extent such forfeitures are insufficient for such purpose, the Participating Employer with whom the Participant was last employed as a Qualified Employee will contribute the amount required to restore the Account.  A Participant described in the last sentence of Subsection (a) who is reemployed before incurring five consecutive One-Year Breaks in Service following the date of his or her Termination of Employment will be deemed to have repaid his or her deemed distribution upon his or her reemployment as a Qualified Employee."

9.               Section 7.3 of the Plan is amended effective January 1, 2002, to read as follows:

"7.3     Other Forfeitures.

(a)       Except as provided in Section 7.2, the nonvested portions of a Participant's Profit Sharing Contribution Account will continue to be held in a separate subaccount of such Account until the Participant incurs five consecutive One-Year Breaks in Service, at which time the subaccount balance will be forfeited.  If the Participant resumes employment with an Affiliated Organization prior to incurring five consecutive One-Year Breaks in Service, such subaccount will be disregarded and its balance will be included in the Profit Sharing Contribution Account.

(b)       A Participant's vested interest in his or her Profit Sharing Contribution Account balance following a resumption of employment in accordance with Subsection (a) at any given time will not be less than the amount "X" determined by the formula: X = P(AB + (R x D)) - (R x D), where P is the Participant's vested percentage at the time of determination; AB is the Account balance at the time of determination; D is the amount of the distribution; and R is the ratio of the Account balance at the time of determination, to the subaccount balance immediately following the distribution."

10.            Section 8.1(a)(v) of the Plan is amended effective February 1, 2002, to read as follows:

"(v)      All distributions will be made in the form of a check drawn on the Trust and, if applicable, a canceled note evidencing any Plan loan; provided, that if the vested portion of the Account balance of a Participant or Beneficiary of a deceased Participant is credited with the equivalent of at least 10 full shares of Company Stock, at the election of the Participant or Beneficiary, distribution of the vested portion of the Account balance invested in the BMC Common Stock Fund may be distributed in full shares of Company Stock and cash in lieu of any fractional share."

11.            Section 9.2(a) of the Plan is amended effective January 1, 2002, to read as follows:

"(a)      For each Plan Year that the designed-based safe harbor alternative described in Code section 401(k)(12) has not been satisfied, the Plan must satisfy the requirements of Code section 401(k)(3)."

12.            Section 9.2 of the Plan is amended effective January 1, 2002, by adding a new Subsection (g) that reads as follows:

"(g)      It is intended that the Plan will satisfy the design-based safe harbor alternative described in Code section 401(k)(12) to satisfy the Code section 401(k) nondiscrimination test."

13.            Section 9.3(a) of the Plan is amended effective January 1, 2002, to read as follows:

"(a)      For each Plan Year that the designed-based safe harbor alternative described in Code section 401(m)(11) has not been satisfied, the Plan must satisfy the requirements of Code section 401(m)(2)."

14.            Section 9.3 of the Plan is amended effective January 1, 2002, by adding a new Subsection (g) that reads as follows:

"(g)      It is intended that the Plan will satisfy the design-based safe harbor alternative described in Code section 401(m)(11) to satisfy the Code section 401(m) nondiscrimination test.  Notwithstanding the foregoing, After-Tax Contributions made by Participants will satisfy the nondiscrimination tests described in Section 9.3(a)."

IN WITNESS WHEREOF, the undersigned has caused this instrument to be executed this 26th day of December, 2001.

                                                                                    BMC INDUSTRIES, INC.

Attest:/s/Jon A. Dobson                                                By:  /s/Bradley D. Carlson

            Secretary                                                          Its: Treasurer

EX-10.5 6 exhibit_10-5.htm

BMC INDUSTRIES, INC.

SAVINGS AND PROFIT SHARING PLAN

2001 REVISION

Third Declaration of Amendment

Pursuant to the retained power of amendment contained in Section 11.2 of the BMC Industries, Inc. Savings and Profit Sharing Plan - 2001 Revision, the Plan is amended in the manner set forth below to reflect certain provisions of the Economic Growth and Tax Relief Reconciliation Act of 2001 ("EGTRRA").  This amendment is intended as good faith compliance with the requirements of EGTRRA and is to be construed in accordance with EGTRRA and Treasury Regulations.  Except as this amendment provides otherwise, this amendment will be effective as of January 1, 2002.  This amendment will supersede the provisions of the Plan to the extent those provisions are inconsistent with the provisions of this amendment.

1)     Effective for limitation years beginning after December 31, 2001, the aggregate annual additions that may be contributed or allocated to a Participant's account under the Plan for any Plan Year will not exceed the lesser of:

(a)   $40,000, as adjusted for increases in the cost-of-living under Code section 415(d), or

(b)  100 percent of the Participant's Section 415 Wages for the Plan Year.  The compensation limit referred to in this clause (b) will not apply to any contribution for medical benefits after separation from service (within the meaning of Code sections 401(h) or 419A(f)(2)) that is otherwise treated as an annual addition.

2)     The Eligible earnings and Testing Wages of a Participant taken into account for any Plan Year beginning after December 31, 2001, will not exceed $200,000, as adjusted for cost-of-living increases in accordance with Code section 401(a)(17)(B).  The cost-of-living adjustment in effect for a calendar year applies to Eligible Earnings and Testing Wages for the determination period that begins with or within such calendar year.

3)     The term "key employee" means any employee or former employee (including any deceased employee) who, at any time during the Plan Year that includes the determination date, was an officer of an Affiliated Organization having annual compensation greater than $130,000 (as adjusted under Code section 416(i)(1) for Plan Years beginning after December 31, 2002), a 5-percent owner of the Affiliated Organization, or a 1-percent owner of the Affiliated Organization having annual compensation of more than $150,000.  For this purpose annual compensation means compensation within the meaning of Code section 415(c)(3).  The determination of key employees will be made in accordance with Code section 416(i)(1) of the Code and Treasury Regulations.

4)     In determining if the Plan is a top-heavy plan, the present values of accrued benefits and the amounts of account balances of an employee as of the determination date will be increased by the distributions made with respect to the employee under the Plan and any plan aggregated with the Plan under Code section 416(g)(2) during the 1-year period ending on the determination date.  The preceding sentence will also apply to distributions under a termination plan which, had it not been terminated, would have been aggregated with the Plan under Code section 416(g)(2)(A)(i).  If a distribution is made for a reason other than separation from service, death, or disability, this provision will be applied by substituting "5-year period" for "1-year period."  The accrued benefits and accounts of any individual who has not performed services for the Affiliated Organization during the 1-year period ending on the determination date will not be taken into account.

5)     If the Plan is a top-heavy plan, Matching Contributions will be taken into account for purposes of satisfying the minimum contribution requirements of Code section 416(c)(2) and the Plan.  The preceding sentence will apply with respect to Matching Contributions under the Plan or, if the Plan provides that the minimum contribution requirement will be met in another plan, such other plan.  Matching Contributions that are used to satisfy the minimum contribution requirements will be treated as matching contributions for purposes of the actual contribution percentage test and other requirements of Code section 401(m).

6)     Effective for distributions made after December 31, 2001, for purposes of the direct rollover provisions in Section 8.7, an eligible retirement plan will also mean an annuity contract described in Code section 403(b) and an eligible plan under Code section 457(b) that is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state and that agrees to separately account for amounts transferred into such plan from this Plan.  The definition of eligible retirement plan will also apply in the case of a distribution to a surviving spouse, or to a spouse or former spouse who is the alternate payee under a qualified domestic relation order, as defined in Code section 414(p).  No amount that is distributed on account of hardship will be an eligible rollover distribution, and the distribute may not elect to have any portion of such a distribution paid directly to an eligible retirement plan.

7)     A portion of a distribution will not fail to be an Eligible Rollover Distribution merely because the portion consists of After-Tax Contributions that are not includible in gross income.  However, such portion may be transferred only to an individual retirement account or annuity described in section 408(a) or (b) of the Code or to a qualified defined  contribution plan described in section 401(a) or 403(a) of the Code that agrees to separately account for amounts so transferred, including separately accounting for the portion of such distribution that is includible in gross income and the portion of such distribution that is not so includible.

8)     The plan will accept Rollover contributions of Eligible Rollover Distributions made after December 31, 2001, from:

(a)   a qualified plan described in Code section 401(a) or 403(a), excluding after-tax employee contributions;

(b)  an annuity contract described in Code section 403(b), excluding after-tax employee contributions; or

(c)   an eligible plan under Code section 457(b) that is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state.

9)     The Plan will not accept a participant rollover contribution of the portion of a distribution from an individual retirement account or annuity described in section 408(a) or 408(b) of the Code that is eligible to be rolled over and would otherwise be includible in gross income, other than such an account or annuity that is solely a conduit for distributions from a qualified retirement plan, excluding after-tax employee contributions.

10)For purposes of Section 8.1(a) (involuntary distribution of vested Accounts of $5,000 or less), the value of a Participant's no forfeitable Account balances will be determined without regard to that portion of the Account balances that is attributable to a Participant's Profit Sharing Plan Rollover Account and Rollover contributions (and earnings allocable thereto) within the meaning of sections 402(c), 403(a)(4), 403(b)(8), 408(d)(3)(A)(ii), and 457(e)(16) of the Code.

11)The multiple use test described in Treasury Regulation section 1.401(m)-2 and Section 9.4 will not apply.

12)The top-heavy requirements of Code section 416 and Section 13.3 will not apply in any year beginning after December 31, 2001, in which the Plan consists solely of a cash or deferred arrangement which meets the design-based safe harbor alternative requirements of Code section 401(k)(12) and Matching Contributions with respect to which the design-based safe harbor alternative requirements of Code section 401(m)(11) are met.

13)A Participant who receives a hardship withdrawal of 401(k) Contributions after December 31, 2001, will be prohibited from making 401(k) Contributions and After-Tax Contributions under this Plan and elective deferrals and after-tax employee contributions under any other plans maintained by any Affiliated Organization for 6 months after receipt of the hardship withdrawal.

14)A Participant's vested Account balances will become distributable following the Participant's severance from employment with all Affiliated Organizations.  Such a distribution will be subject to the other provisions of the Plan regarding distributions, other than provisions that require a separation from service before such amounts may be distributed.

IN WITNESS WHEREOF, the undersigned has caused this instrument to be executed this 31^st day of December, 2002.

                                                                                    BMC INDUSTRIES, INC.

Attest:  /s/Jon A. Dobson                                            by:  /s/Susan Linzmeier

            Secretary                                                         its: V.P. Human Resources

EX-10.26 7 exhibit_10-26.htm

BMC Buckbee-Mears St. Paul

A unit of BMC Industries, Inc.

278 East 7^th Street

St. Paul, MN 55101

(651) 228-6400 / (800)BMC-Etch

Fax (651) 228-6541

January 14, 2003

Mr. Henry Zaidan

President

GMT Corporation

245 E. Sixth Street

St. Paul, MN  55101-1918

Dear Henry,

Please accept this letter as official notice that Buckbee-Mears will terminate the lease for the PS-3 space on February 28, 2003.

Please contact me if you have any questions.

Sincerely,

/s/Dennis Malecek

Dennis Malacek

Director of Operations

651-228-6471

EX-10.47 8 exhibit_10-47.htm

THE SEVENTH RESTATED

GRAPHIC COMMUNICATIONS INTERNATIONAL UNION,

TWIN CITIES LOCAL 6A -

BUCKBEE-MEARS PENSION PLAN

Generally Effective January 1, 2001

TABLE OF CONTENTS

 NAME AND HISTORY OF PLAN........................................................................................... 1

    Section 1.1.................................................................................................................................. 1

ARTICLE II.................................................................................................................................... 1

    DEFINITIONS........................................................................................................................... 1

    Section 2.1.................................................................................................................................. 1

    Section 2.2 - Accrual Service...................................................................................................... 1

    Section 2.3 - Accrued Benefit...................................................................................................... 3

    Section 2.4 - Actuarial Equivalent................................................................................................ 4

    Section 2.5 - Actuary.................................................................................................................. 4

    Section 2.6 - Beneficiary.............................................................................................................. 4

    Section 2.7 - -  Break in Service.................................................................................................... 5

    Section 2.8 - Code...................................................................................................................... 5

    Section 2.9 - Collective Bargaining Agreement............................................................................. 5

    Section 2.10 - Company.............................................................................................................. 6

    Section 2.11 - Computation Periods............................................................................................ 6

    Section 2.12 - Effective Date....................................................................................................... 6

    Section 2.13 - Eligibility and Vesting Service................................................................................ 6

    Section 2.14 - Eligible Employee.................................................................................................. 7

    Section 2.15 - Employer.............................................................................................................. 8

    Section 2.16 - Employment Commencement Date........................................................................ 8

    Section 2.17 - ERISA................................................................................................................. 8

    Section 2.18 - Fiduciary.............................................................................................................. 8

    Section 2.19 - -  Former Plan......................................................................................................... 8

    Section 2.20 - Hours Worked..................................................................................................... 8

    Section 2.21 - Normal Retirement Date....................................................................................... 8

    Section 2.22 - Normal Retirement Age...................................................................................... 11

    Section 2.23 - PBGC................................................................................................................ 11

    Section 2.24 - Participant.......................................................................................................... 11

    Section 2.25 - Plan.................................................................................................................... 11

    Section 2.26 - Plan Administrator.............................................................................................. 11

    Section 2.27 - Plan Anniversary Date......................................................................................... 11

    Section 2.28 - Plan Year........................................................................................................... 11

    Section 2.29 - Re-Employment Commencement Date................................................................ 11

    Section 2.30 - Retirement Fund................................................................................................. 12

    Section 2.31 - Termination of Employment................................................................................. 12

    Section 2.32 - Trustees.............................................................................................................. 12

    Section 2.33 - Union................................................................................................................. 12

    Section 2.34- Vesting................................................................................................................ 12

ARTICLE III................................................................................................................................ 12

    EMPLOYEE PARTICIPATION.............................................................................................. 12

    Section 3.1 - Eligibility for Participation...................................................................................... 12

    Section 3.2 - Transfer to Eligible Employee Status...................................................................... 13

    Section 3.3 - Re-Employment after a Break in Service............................................................... 13

    Section 3.4 - Preservation of Pre-Break Service........................................................................ 13

ARTICLE IV................................................................................................................................ 14

    BENEFITS............................................................................................................................... 14

    Section 4.1 - Normal Retirement Benefit Formula....................................................................... 14

    Section 4.2 - Accrued Benefit.................................................................................................... 14

    Section 4.3 - Early Retirement Benefit........................................................................................ 14

    Section 4.4 - Benefit Upon Other Termination of Employment.................................................... 15

    Section 4.5 - Early Commencement of Benefits.......................................................................... 15

    Section 4.6 - Minimum Benefit................................................................................................... 16

    Section 4.7 - Benefits that Matured Prior to the Effective Date.................................................... 16

    Section 4.8 - Non-Duplication of Benefits.................................................................................. 16

    Section 4.9 - Optional Forms of Benefit Payments...................................................................... 16

    Section 4.10 - Qualified Joint and Survivor Annuity.................................................................... 17

    Section 4.11 - Pre-Retirement Spouse Annuity........................................................................... 18

    Section 4.12 - Payment of Small Amounts.................................................................................. 20

    Section 4.13 - No Other Benefits............................................................................................... 21

    Section 4.14 - Maximum Benefits.............................................................................................. 21

    Section 4.15 - Death Benefit...................................................................................................... 21

    Section 4.16 - Manner of Election - Revocation for Joint and Survivor Annuity -

    Normal Retirement Age............................................................................................................. 22

ARTICLE V.................................................................................................................................. 23

    PLAN FINANCING................................................................................................................ 23

    Section 5.1 - Contributions........................................................................................................ 23

ARTICLE VI................................................................................................................................ 23

    ACTUARY............................................................................................................................... 23

    Section 6.1 - Appointment and Duties........................................................................................ 23

    Section 6.2 - Successors........................................................................................................... 24

ARTICLE VII............................................................................................................................... 24

    ADMINISTRATION............................................................................................................... 24

    Section 7.1 - Allocation of Responsibility Among Fiduciaries for Plan and Retirement

    Fund Administration................................................................................................................... 24

    Section 7.2 - Facility of Payment................................................................................................ 24

    Section 7.3 - Discretionary Authority......................................................................................... 25

ARTICLE VIII............................................................................................................................. 25

    MISCELLANEOUS................................................................................................................. 25

    Section 8.1 - Non-Guarantee of Employment............................................................................. 25

    Section 8.2 - Rights to Retirement Fund Assets.......................................................................... 25

    Section 8.3 - Non-Alienation of Benefits.................................................................................... 25

    Section 8.4 - Distributions Under Domestic Relations Orders..................................................... 26

ARTICLE IX................................................................................................................................ 26

    AMENDMENTS...................................................................................................................... 26

    Section 9.1 - Amendment.......................................................................................................... 26

ARTICLE X.................................................................................................................................. 27

    SUCCESSOR COMPANY AND MERGER OR CONSOLIDATION OF PLANS............... 27

    Section 10.1 - Successor Company........................................................................................... 27

    Section 10.2 - Plan Assets......................................................................................................... 27

ARTICLE XI................................................................................................................................ 28

    TOP HEAVY PROVISIONS................................................................................................... 28

    Section 11.1 - Top Heavy Plan Requirements............................................................................ 28

    Section 11.2 - Determination of Top Heavy Status..................................................................... 28

    Section 11.3 - Vesting if a Portion of the Plan Becomes Top Heavy............................................ 33

    Section 11.4 - Minimum Benefit Requirement If a Portion of the Plan Becomes Top Heavy......... 34

ARTICLE XII............................................................................................................................... 35

ARTICLE XIII............................................................................................................................. 36

    PLAN TERMINATION........................................................................................................... 36

    Section 13.1 - Right to Terminate............................................................................................... 36

    Section 13.2 - Partial Termination.............................................................................................. 37

    Section 13.3 - Liquidation of Retirement Fund............................................................................ 37

    Section 13.4 - Manner of Distribution........................................................................................ 39

    Section 13.5 - Residual Amounts............................................................................................... 40

ARTICLE XIV.............................................................................................................................. 40

    CONSTRUCTION.................................................................................................................. 40

    Section 14.1 - Construction....................................................................................................... 40

    Section 14.2 - Authority of Trustees.......................................................................................... 40

ARTICLE I

NAME AND HISTORY OF PLAN

    Section 1.1 - THE GRAPHIC COMMUNICATIONS INTERNATIONAL UNION, TWIN CITIES LOCAL 6A - BUCKBEE-MEARS PENSION PLAN (formerly known as the Pension Plan of the Lithographers and Photoengravers International Union, Twin Cities Local 6A - Buckbee Mears Retirement Fund and more recently known as the Graphic Arts International Union, Twin Cities Local 6A - Buckbee-Mears Pension Plan) as set forth in the instrument dated the 27^th day of December 1968, amended January 1, 1975, restated January 1, 1976, amended and restated January 1, 1982, amended and restated January 1, 1984, amended and restated January 1, 1985, amended and restated January 1, 1989, and is hereby amended and restated in its entirety to be effective as of January 1, 2001.

ARTICLE II

DEFINITIONS

    Section 2.1 - All of the definitions contained in the Restated Agreement and Declaration of Trust of the GRAPHIC COMMUNICATIONS INTERNATIONAL UNION, TWIN CITIES LOCAL 6A - BUCKBEE-MEARS RETIREMENT FUND, formerly the Graphic Arts International Union, Twin Cities Local 6A - Buckbee Mears Retirement Fund, are incorporated into this Plan by reference.

    Section 2.2 - Accrual Service  The Accrual Service credited to a Participant will vary in accordance with the particular year in which such service was performed and the year in which said Participant's employment terminated.  Computations of Accrual Service shall include all Hours Worked by an Eligible Employee in an Accrual Computation Period.

(a)      For Participants who are laid off or who terminate employment with the Employer after December 31, 1984, Accrual Service after December 31, 1975 is accumulated at the rate of one (1) year for each Accrual Computation Period in which an Eligible Employee completes 1,800 or more Hours Worked.  If an Eligible Employee works at least 900 hours but less than 1,800 hours, he will be entitled to a fraction of one (1) year Accrual Service based upon the number of hours actually worked divided by 1,800 hours.  There will be no accumulation of Accrual Service for any complete Accrual Computation Period in which a Participant accumulates less than 900 Hours Worked.

(b)      For Participants who are laid off or who terminate employment with the Employer between January 1, 1981 and December 31, 1984, Accrual Service after December 31, 1975 is accumulated at the rate of one (1) year for each Accrual Computation Period in which an Eligible Employee completes 1,800 or more hours worked.  There will be no accumulation of Accrual Service for any complete Accrual Computation Period in which a Participant accumulates less than 975 hours.  If a Participant accumulates more than 975 hours, but less than 1,800 hours, he will be entitled to a fraction of one (1) year of Accrual Service based upon the number of hours actually worked divided by 1,950 hours.

(c)      In the case of a Participant who is laid off or terminates employment with the Employer    during the period from January 1, 1976 through December 1, 1980, an Eligible Employee shall have accumulated at least 975 hours during the computation period in order to receive any Accrual Service for that period.  An Eligible Employee working at least 975 hours but less than 1,950 hours in an Accrual Computation Period between January 1, 1976 and December 31, 1980, shall accrue a fraction of one (1) year of Accrual Service, the numerator being the number of hours actually worked and the denominator being 1,950 hours.

(d)      Accrual Service prior to January 1, 1976 shall be the service recognized for benefit accrual purposes under the terms of the Former Plan.  For each Plan Year from June 1, 1968 to May 31, 1975, service was accumulated as follows:

•         1 year of Accrual Service if at least 48 weekly payroll checks received from the Employer in a Plan Year.

•         3/4 of 1 year of Accrual Service if between 36 and 47 weekly payroll checks received from the Employer in a Plan Year.

•         ½ of 1 year of Accrual Service if between 24 and 35 weekly payroll checks received from the Employer in a Plan Year.

•         No credit if less than 24 weekly payroll checks received from the Employer in a Plan year.

(e)      For the short Plan Year June 1, 1975 to December 31, 1975, service was accumulated as follows:

•         58.33% of 1 year of Accrual Service if at least 28 weekly payroll checks received from the Employer in the Plan Year.

•         43.75% of 1 year of Accrual Service if between 21 and 27 weekly payroll checks received from the Employer in the Plan Year.

•         29.17% of 1 year of Accrual Service if between 14 and 20 weekly payroll checks received from the Employer in the Plan Year.

•         No credit if less than 14 weekly payroll checks received from the Employer in the Plan Year.

(f)       A Participant who retires on or after January 1, 1973 is entitled to a maximum of ten (10) Years of Service under this Plan for vesting and accrual purposes for employment with the Employer within the ten (10) years prior to June 1, 1968 provided that such service would otherwise qualify under the terms of this Plan.  For purposes of determining Accrual Service, years prior to June 1, 1968, shall be calculated pursuant to Section 2.2(d).

(g)      Service prior to June 1, 1958, shall not be counted for the purpose of calculating Accrual Service under this Plan.

    Section 2.3 - Accrued Benefit.  The Accrued Benefit for each Participant who on or after January 1, 2003:

(a)      terminates employment with the Employer:

(b)      is laid off; or

(c)      ceases being an Eligible Employee;

shall be $43.50 multiplied by the number of years of Accrual Service through December 31, 2001; plus, Hours Worked from January 1, 2002 through June 30, 2002 divided by 1800 hours multiplied by $43.50; plus, Hours Worked from July 1, 2002 through December 31, 2002 divided by 1800 multiplied by $21.75; plus $21.75 multiplied by the number of years of Accrual Service on or after January 1, 2003.  No Hours Worked in 2002 in excess of 1800 hours shall be included in these equations.  Pursuant to Section 2.2, there will be no accumulation of Accrual Service for any complete Accrual Computation Period in which a Participant accumulates less than 900 Hours Worked; in addition, if any Eligible Employee has less than 900 Hours Worked in the year 2002, he or she shall not be entitled to any benefit accrual for 2002.

    With respect to any Participant who terminated employment with the Employer or was laid off or ceased to be an Eligible Employee prior to January 1, 2003, the following Accrued Benefit shall be applicable for the following period of time:

2002                                      *

2001                                      $43.50 per year of Accrual Service

2000                                      $43.50 per year of Accrual Service

1999                                      $43.50 per year of Accrual Service

1998                                      $39.00 per year of Accrual Service

1997                                      $35.00 per year of Accrual Service

1996                                      $34.00 per year of Accrual Service

1995                                      $28.50 per year of Accrual Service

1991                                      $28.00 per year of Accrual Service

1990                                      $27.00 per year of Accrual Service

1989                                      $25.00 per year of Accrual Service

1988                                      $24.00 per year of Accrual Service

1987                                      $22.00 per year of Accrual Service

1986                                      $21.00 per year of Accrual Service

1985                                      $19.00 per year of Accrual Service

1984                                      $16.00 per year of Accrual Service

1983                                      $14.00 per year of Accrual Service

1982                                      $13.00 per year of Accrual Service

1981                                      $11.00 per year of Accrual Service

9/1/80 - 12/31/80                   $ 9.50 per year of Accrual Service, except for participants who terminated employment prior to 1/1/80.

*        $43.50 multiplied by the number of years of Accrual Service through December 31, 2001; plus, Hours Worked from January 1, 2002 through June 30, 2002 divided by 1800 hours multiplied by $43.50; plus, Hours Worked from July 1, 2002 through December 31, 2002 divided by 1800 multiplied by $21.75.  No Hours Worked in 2002 in excess of 1800 hours shall be included in these equations.  Pursuant to Section 2.2, there will be no accumulation of Accrual Service for any complete Accrual Computation Period in which a Participant accumulates less than 900 Hours Worked; in addition, if any Eligible Employee has less than 900 Hours  Worked  in the year 2002, he or she shall not be entitled to any benefit accrual for 2002.

    The Accrued Benefit of any Participant who terminated employment with the Employer on or before December 31, 1979 shall be the Accrued Benefit that was in effect in the Plan at the time of such termination.

    Section 2.4 -  Actuarial Equivalent.  In the event that a specific actuarial factor is not provided under this Plan, the appropriate actuarial equivalence factor shall be the actuarial factors issued by the Pension Benefit Guaranty Corporation for the first day of January of the year for which the actuarial equivalence is provided.  The factor shall use an average of the appropriate male and female factors.

    Section 2.5 -  Actuary.  The Actuary is the corporation, firm or individual appointed and acting from time to time pursuant to the terms of Article VI.

    Section 2.6 -  Beneficiary.  A Beneficiary is the person or persons, natural or otherwise, other than a joint or contingent annuitant, designated by a Participant to receive any benefit payable under the Plan in the event of his death.

    A Participant who has designated a Beneficiary may, without the consent of such Beneficiary, alter or revoke such designation.  However, the spouse of a Participant must consent to the naming of a Beneficiary other than himself or herself.  Such consent must be executed in the presence of a notary public.  To be effective, any Participant's designation, alteration, or revocation of a Beneficiary shall be in writing, in such form as the Trustees may prescribe, and shall be filed with the Trustees prior to the death of the Participant.  If, at the time a death benefit becomes payable, there is not on file with the Trustees a fully executed designation of Beneficiary with spousal consent where required, then the designated Beneficiary shall be the person or persons surviving him in the first of the following classes in which there is a survivor, share and share alike:

(a)      his spouse;

(b)      his children, except that if any of his children predecease him but leave issue surviving him, such issue shall take by right of representation the share their parent would have taken if living;

(c)      his parents;

(d)      his brothers and sisters;

(e)      his personal representative or representatives (executors and administrators).

The identity of each Beneficiary in each case shall be determined by the Trustees.  Each such determination shall be final and binding for all persons.  Should the Plan Administrator not have a valid consent by a spouse to the designation by a Participant of a Beneficiary other than the spouse, the Trustees will pay a Participant's benefits to the spouse.

    Section 2.7 -  Break in Service.  A Break in Service occurs only when an Eligible Employee receives no compensation and no vesting credit during a Vesting Computation Period.  Such compensation shall include direct and indirect compensation by the Employer for Hours Worked including sick pay, vacation pay, pay during a leave of absence, disability income, and such other indirect compensation as may be required to be recognized for Break in Service purposes under ERISA or rules or regulations related thereto.

    Section 2.8 -  Code.  Code means the Internal Revenue Code of 1986, as amended or replaced from time to time.

    Section 2.9 -  Collective Bargaining Agreement.  Collective Bargaining Agreement means the existing Collective Bargaining Agreement between Buckbee-Mears Saint Paul and the Union effective June 1, 1976 through May 31, 1978, as well as any extensions or renewals thereof, or any new Collective Bargaining Agreement executed in the future which provides for the payment of contributions to the Retirement Fund as well as any extension or renewal thereof.

    Section 2.10 - Company.  Company means BMC Industries, Inc.

    Section 2.11 - Computation Periods.

(a)      Eligibility Computation Periods - the 12-month period beginning with an employee's Employment Commencement Date, and the 12-month period commencing on any Plan Anniversary Date after his Employment Commencement Date.

(b)      Vesting and Accrual Computation Periods - the 12-month period commencing on the Plan Anniversary Date.

    Section 2.12 - Effective Date.  Except as specifically stated herein, the Effective Date of this Restatement is January 1, 2001.

    Section 2.13 - Eligibility and Vesting Service.

(a)      Eligibility Service after December 31, 1975 is accumulated at the rate of one year for each Eligibility Computation Period in which an Eligible Employee completes 1,000 or more Hours Worked.  There is no accumulation for an Eligible Employee for a Computation Period in which he has less than 1,000 Hours Worked.

(b)      Vesting Service after December 31, 1975 is accumulated at the rate of one year for each Vesting Computation Period in which an Eligible Employee completes 1,000 or more Hours Worked.  There is no accumulation for an Eligible Employee for a Vesting Computation Period in which he has less than 1,000 Hours Worked.

Except, in the event an Eligible Employee's first Eligibility Computation Period in which 1,000 or more Hours Worked are completed overlaps two Vesting Computation Periods, neither of which contains 1,000 or more Hours Worked by the Eligible Employee, the second such Vesting Computation Period will be deemed, for vesting purposes, to contain 1,000 hours.  There is no accumulation for any Vesting Computation Periods prior to the Vesting Computation Period in which the Eligible Employee attains the age of 18.

Notwithstanding the definition of "Hours Worked" contained in this Plan, all Hours Worked by an employee for the Employer, the Company and any other corporation that is a member of a controlled group of corporations, (within the meaning of Code section 1563(a) without regard to Code sections 1563(a)(4) and 1563(e)(3)(C)) that includes the Company, any trade or business (whether or not incorporated) that together with the Company is under common control (within the meaning of Code section 414(c)), any member of an "affiliated service group" (within the meaning of Code section 414(m)) of which the Company is a member or any other organization that, together with the Company, is treated as a single employer pursuant to Code section 414(o) and Treasury Regulations thereunder ("ERISA Affiliates"); provided, that, for purposes of applying the limitations set forth at Section 414, such determination under Code section 1563(a) will be made by substituting the phrase "more than 50 percent" for the phrase "at least 80 percent" wherever it appears in such Code section, and will be counted for Eligibility Service and Vesting Service purposes whether or not such employee was an Eligible Employee at the time the hours were worked.

Eligible Employees on an authorized military leave of absence will accumulate hours for Vesting and Eligibility Service at the rate of 40 hours for each seven (7) consecutive days of leave.

(c)      Vesting and Eligibility Service prior to January 1, 1976 for a Participant as of January 1, 1976, who had been covered under the Former Plan, will be the Participant's last period of continuous employment with the Company prior to January 1, 1976 rounded to the nearest year.

    Section 2.14 - Eligible Employee.

(a)      Except as provided in Subsection (b), an "Eligible Employee" is an employee who has performed services for the Employer as an employee of the Employer (as classified by the Company or the Employer at the time the services are performed without regard to any subsequent reclassification) for a period of at least sixty-six (66) working days covered by the Collective Bargaining Agreement and on whose behalf contributions are made to the Retirement Fund pursuant to the terms of the Collective Bargaining Agreement between Buckbee-Mears Saint Paul and the Union.

(b)      An individual who is classified by the Company or the Employer as an independent contractor, leased employee or as any other status in which the individual is not classified by the Company or the Employer as an employee of the Employer at the time services are performed is not an Eligible Employee.  No judicial or administrative reclassification, or reclassification by the Company or the Employer, will be applied to grant retroactive eligibility to any individual under the Plan.

(c)      In addition, Eligible Employee includes full-time officers and employees of the Union, the Retirement Fund, and any other benefit fund established by the Collective Bargaining Agreement, provided that contributions to the Retirement Fund are made on behalf of said Eligible Employees by their respective Employers.

    Section 2.15 - Employer.  Employer shall mean Buckbee-Mears Saint Paul (a unit of  the Company) and any employer of an Eligible Employee on whose behalf contributions are made into the Retirement Fund.  The Union, the Retirement Fund, and other benefit funds described in Section 2.14 hereof shall be deemed Employers for the limited purpose of making payments to the Retirement Fund on behalf of Eligible Employees (as defined in Section 2.14).

    Section 2.16 - Employment Commencement Date.  The date an Eligible Employee first works one hour for the Employer.

    Section 2.17 - ERISA.  The Employee Retirement Income Security Act of 1974, as amended from time to time.

    Section 2.18 - Fiduciary.  The named Fiduciary of the Plan is the Board of Trustees, the Investment Manager, the Plan Administrator, insurance company or companies, or combination thereof, appointed and acting from time to time in accordance with the provisions of Section 5.2 and Article VII and the  Retirement Fund, to hold, invest and disburse assets in the Retirement Fund and administer the Plan.

    Section 2.19 -  Former Plan.  The Former Plan is the Restated Graphic Communications International Union, Twin Cities Local 6A - Buckbee Mears Pension Plan in existence the day before the Effective Date of this Plan.

    Section 2.20 - Hours Worked.  Determined as follows:

(a)      For Eligible Employees whose hours are not required to be counted and recorded by any Federal Law such as the Fair Labor Standards Act, Hours Worked will be recorded at the rate of 45 for each 7 days of employment in covered employment during the Computation Period in which the Eligible Employee would be required under Subsection (c) hereof to be credited with at least one (1) Hour Worked.

(b)      For all other Eligible Employees, Hours Worked will be total Hours Worked computed in accordance with Subsection (c) hereof.

(c)      (1)      "Hours Worked" shall mean each hour worked for which the Employer, either directly or indirectly, pays an Eligible Employee, or for which the Eligible Employee is entitled to payment, for the performance of duties during the Plan Year.  The Eligible Employee shall be credited with the Hours Worked under this subparagraph (1) for the Plan Year in which the Eligible Employee performs the duties, irrespective of when paid;

        (2)      Each Hour Worked for back pay, irrespective of mitigation of damages, to which the Employer has agreed or for which the Eligible Employee has received an award.  Hours Worked shall be credited under this subparagraph (2) to the Eligible Employee for the Plan Year(s) to which the award or the agreement pertains rather than for the Plan Year in which the award, agreement or payment is made; and

        (3)      Each Hour Worked for which the Employer, either directly or indirectly, pays an Eligible Employee, or for which the Eligible Employee is entitled to payment (irrespective of whether the employment relationship is terminated), for reasons other than for the performance of duties during a Plan Year, such as leave of absence, vacation, holiday, sick leave, illness, incapacity (including disability and periods for which an Eligible Employee is entitled to receive workers' compensation benefits), layoff, jury duty or military duty.  Hours Worked shall be credited under this subparagraph (3) for the Plan Year in which the Employer pays the Eligible Employee, the Eligible Employee becomes entitled to payment or the payment becomes due, whichever first occurs.  Notwithstanding the preceding provisions of this subparagraph (3), Hours Worked shall not be credited for:

(i)       more than five hundred one (501) Hours Worked under subparagraph (c) to an Eligible Employee on account of any single continuous period during which the Eligible Employee does not perform any duties (whether or not such period occurs during a single Plan Year);

(ii)      hours for which payments are made or due to the Eligible Employee under a plan maintained solely for the purpose of complying with the applicable unemployment compensation law; and

(iii)     hours for which a payment to an Eligible Employee solely reimburses the Eligible Employee for medical or medically related expenses incurred by the Eligible Employee.

An Hour Worked shall not be credited under more than one of the above subparagraphs (1), (2) or (3) of subsection (c).  Furthermore, if the Eligible Employee is to be credited with Hours Worked for the twelve (12) month period beginning with the Eligible Employee's Employment Commencement Date, then the twelve (12) month period shall be substituted for the term "Plan Year" wherever the latter term appears in this Section 2.20.

(d)      Hours Worked shall also include all Hours Worked by any Eligible Employee for which the Eligible Employee receives compensation from the Union.  These hours represent lost time hours which, but for this subsection (d), the Eligible Employee would not otherwise be given credit.

Any ambiguity with respect to the crediting of an Hour Worked shall be resolved in favor of the Eligible Employee.  Furthermore, in crediting Hours Worked under this Section 2.20, the rules of paragraphs (b) and (c) of Department of Labor Regulation § 2530.200b-2 which the Plan, by this reference, specifically incorporates in full within this Section 2.20, shall be applied.

Solely for purposes of determining whether the Eligible Employee incurs a Break in Service under any provision of this Plan, the Plan Administrator shall credit Hours Worked during an Eligible Employee's unpaid absence period due to maternity or paternity leave if his or her absence is due to the Eligible Employee's pregnancy, the birth of the Eligible Employee's child, the placement with the Eligible Employee of an adopted child, or the care of the Eligible Employee's child immediately following the child's birth or placement.  The Plan Administrator shall credit Hours Worked under this paragraph on the basis of the number of Hours Worked the Employee would receive if he were paid during the absence period or, if the Plan Administrator cannot determine the number of Hours Worked the Eligible Employee would receive, on the basis of eight (8) hours per day during the absence period.  The Plan Administrator only shall credit the number of Hours Worked (up to 501 Hours Worked) necessary to prevent an Eligible Employee's Break in Service.  The Plan Administrator shall credit all Hours Worked described in this paragraph to the computation period in which the absence period begins or, if the Eligible Employee does not need these Hours Worked to prevent a Break in Service in the computation period in which is absence period begins, the Plan  Administrator shall credit these Hours Worked to the immediately following Computation Period.  The Plan Administrator shall apply this paragraph for absence periods which begin in Plan Years commencing after December 31, 1984.

(e)      Hours Worked shall also include hours during which a Participant would have worked but for one or more involuntary furlough(s), up to a maximum of sixty (60) working days or four-hundred fifty (450) hours in any Plan Year.  An involuntary furlough shall be defined as a period of time during which the Participant would have worked but for the temporary shutdown of operations mandated by the Company.

(f)       Notwithstanding any provision of this Plan to the contrary, contributions, benefits and service credit with respect to qualified military service will be provided in accordance with Section 414(u) of the Code.

    Section 2.21 - Normal Retirement Date.  The Normal Retirement Date of a Participant is the last day of the month in which he attains age 65.

    Section 2.22 - Normal Retirement Age.  A Participant's Normal Retirement Age is age 65, or five years after the Participant commenced participation in the Plan, whichever is later.

    Section 2.23 - PBGC.  Pension Benefit Guaranty Corporation, a body corporate within the Department of Labor established under the provisions of Title IV of ERISA.

    Section 2.24 - Participant.  A Participant is an Eligible Employee or former Eligible Employee who has satisfied the eligibility requirements of Article III and who is either accruing a benefit or is entitled to receive a benefit under the Plan.

    Section 2.25 - Plan.  The Plan is the Graphic Communications International Union, Twin Cities Local 6A - Buckbee-Mears Pension Plan as may be amended from time to time, this document comprising the Seventh Restatement of such Plan.

    Section 2.26 - Plan Administrator.  The Plan Administrator shall be appointed by the Trustees and serve until replaced by the Trustees or until said Plan Administrator resigns.

    Section 2.27 - Plan Anniversary Date.  The Plan Anniversary Date of this Plan is January 1.

    Section 2.28 - Plan Year.  The Plan Year is the 12-month period commencing each January 1.

    Section 2.29 - Re-Employment Commencement Date.  The date following a Break in Service when an Eligible Employee first works one hour for the Employer.

    Section 2.30 - Retirement Fund.  Retirement Fund  means the Restated Agreement and Declaration of Trust of  Graphic Communications International Union, Twin Cities Local 6A - Buckbee-Mears Retirement Fund, consisting of all contributions to the Retirement Fund received by the Trustees, together with all income, increments, earnings, and profits therefrom, and all other assets held by the Trustees for the uses, purposes, and trusts set forth in said Retirement Fund Trust Agreement.

    Section 2.31 - Termination of Employment.  Termination of Employment is the severance of an Eligible Employee's employment relationship with the Employer, the Company and ERISA Affiliates (as defined in Section 2.13).

    Section 2.32 - Trustees.  Trustees or Trustee means the Trustees or a Trustee of the Retirement Fund.

    Section 2.33 - Union.  Union means Graphic Communications International Union, Twin Cities Local 6A.

    Section 2.34- Vesting.  For purposes of this Plan, an Eligible Employee's Accrued Benefit shall be vested pursuant to the following schedule:

Years of Vesting Service                                 % Vested

0-4 Years of Service                                        0%

5   Years or More                                         100%
 

For Plan years prior to January 1, 1989, the following schedule applies:
 

Years of Vesting Service                                 % Vested

0-9 Years of Service                                         0%

10 Years or More                                          100%

ARTICLE III

EMPLOYEE PARTICIPATION

    Section 3.1 - Eligibility for Participation.  Each Eligible Employee shall become a Participant in the Plan as follows:

(a)      Any Eligible Employee included under the provisions of the Former Plan as of the Effective Date shall continue to participate in accordance with the provisions of this amended and restated Plan.

(b)      Any other Eligible Employee as of the Effective Date who has both attained age 21 and completed an Eligibility Computation Period ending prior to said date, during which he had not less than 1,000 Hours Worked, shall become a Participant on the Effective Date.

(c)      The participation of any Eligible Employee thereafter to become a Participant shall commence as of the earlier of January 1 or July 1 following the date he has both attained age 21 and completed an Eligibility Computation Period ending prior to said date of not less than 1,000 Hours Worked.

    After a Break in Service, the provisions of Section 3.3 and 3.4 shall be applicable.

    Section 3.2 - Transfer to Eligible Employee Status.  Transfer from an ineligible status to the status of an Eligible Employee will result in immediate participation if the Eligible Employee satisfies the requirements of Section 3.1; otherwise he will begin participation in The Plan as provided for in Section 3.1.

    Section 3.3 - Re-Employment after a Break in Service.  An Eligible Employee who has been re-employed after a Break in Service may resume participation in the Plan as soon as he has completed a 12-month period in which he has 900 Hours Worked.  He shall reenter the Plan retroactive to his Re-Employment Commencement Date.

    Such a Participant shall receive Accrual Service if he has 900 or more Hours Worked during the first Accrual Computation Period ending after his Re-Employment Commencement Date.  If he has less than 900 Hours Worked during this partial Computation Period but he has hours equal to at least 900 considering the fraction of the Computation Period worked, he will accumulate a fraction of a year of Accrual Service equal to the ratio of the Hours Worked during such partial Computation Period to 1,800 hours for a full accrual Computation Period.  For periods of re-employment prior to January 1, 1981, an Eligible Employee shall earn credit as described in the previous sentence with 975 hours substituted for 900 hours and 1,950 hours substituted for 1,800 hours.

    Section 3.4 - Preservation of Pre-Break Service.  In the event of re-employment after a Break in Service, service completed prior to the Break in Service for non-vested Participants will be disregarded for all purposes under the Plan unless the number of the Eligible Employee's consecutive Breaks in Service is less than:

(a)      The Eligible Employee's aggregate Years of Vesting Service (without regard to Vesting Service disregarded under Section 3.4), or

(b)      five (5) years, if greater than (a).

    In the event that a Participant terminates employment with the Employer for any reason and suffers consecutive Breaks in Service of five years or less and returns to employment with the Employer as an Eligible Employee, that Participant's Accrued Benefit under Section 2.3 of this Plan shall be calculated by multiplying all of that Participant's years of Accrual Service with the Employer times the Accrued Benefit rate in effect as of the date of that Participant's final termination of employment with the Employer.  In the event that a Participant terminates employment with the Employer for any reason, suffers consecutive Breaks in Service in excess of five years and subsequently returns to employment with the Employer as an Eligible Employee, the Participant's Accrued Benefit under Section 2.3 of the Plan shall be calculated by multiplying the applicable Accrued Benefit rate in effect at the time of the Participant's first Termination of Employment times the years of Accrual Service earned at that time and adding to that figure the amount determined by multiplying the years of Accrual Service earned after the Breaks in Service times the applicable Accrued Benefit rate in effect at the Participant's final Termination of Employment with the Employer.

ARTICLE IV

BENEFITS

    Section 4.1 - Normal Retirement Benefit Formula.  A Participant's pension benefit payable in the normal form shall be a benefit payable for his lifetime in a monthly amount equal to his Accrued Benefit.  The Termination of Employment of a Participant on or after his Normal Retirement Age shall be deemed to be a normal retirement.  Upon such retirement, he shall be entitled to a pension in the amount determined according to the first sentence of this Section 4.1 payable monthly for life, with the first payment to be made as of the first day of the month next following his Termination of Employment, if he is then living, and the last  payment as of the first day of the month in which his death occurs.

    Section 4.2 - Accrued Benefit.  The Accrued Benefit may be determined as of any point in time that the Participant is an Eligible Employee.  In no event will any Accrued Benefit determined after the Effective Date be less than the Accrued Benefit determined as of the preceding Plan Anniversary Date.

    Section 4.3 - Early Retirement Benefit.  The Termination of Employment of a Participant prior to his Normal Retirement Date shall be deemed to be an early retirement if he has then attained age 55 and completed at least 10 years of Vesting Service.  Upon such early retirement, he shall be entitled to a pension payable monthly for life, with the first payment to be made as of the first day of the month next following his Normal Retirement Date, if he  is then living, and the last payment as of the first day of the month in which his death occurs.  The amount of each monthly payment shall equal his Accrued Benefit.

    In lieu of such payment the Participant may elect to have benefits commence on the first of any month following his Termination of Employment and prior to his Normal Retirement Date.  The benefit payable from such earlier commencement date shall be the pension benefit payable in the normal form (as determined under Section 4.1)..

(a)      reduced by six and two-thirds (6-2/3%) percent reduction per year for the first five years of commencement immediately prior to age 65; and

(b)      reduced by three and one-third (3-1/3%) percent reduction per year for an additional five years.

    Section 4.3. A. - Special Early Retirement Benefit.  Effective January 1, 1997, any Participant who terminates employment with the Employer after he reaches age 55 on or after January 1, 1997 and has completed at least 25 years of Accrual Service as of the date of termination shall be eligible to commence a retirement benefit after he has attained age 62 without any reduction in the Accrued Benefit calculated under Section 2.3.

    Section 4.4 - Benefit Upon Other Termination of Employment.  If a Participant's Termination of Employment occurs prior to his Normal Retirement Age, and if at the time of his Termination of Employment he has completed at least 5 years of Vesting Service and has not attained age 55, he shall be entitled to a pension payable monthly for life, with the first payment to be made as of the first day of the month next following his Normal Retirement Date, if he is then living, and the last payment as of the first day of the month in which his death occurs.  The amount of each monthly payment shall equal his Accrued Benefit.

    Section 4.4.A. - Disability Benefit.  Effective January 1, 1998, any Participant with at least 10 years of Accrual Service who terminated employment after age 55 due to a total and permanent disability as determined by the Social Security Administration shall be eligible to retire as of the date of disability without any reduction in the Accrued Benefit calculated under Section 2.3.  Upon such disability retirement, he shall be entitled to a pension payable monthly for life, with the first payment to be made as of the first day of the month following his Termination of Employment and submission of his application for the pension benefit accompanied by evidence that he has been determined to be totally and permanently disabled by the Social Security Administration.  If the Participant is no longer totally and permanently disabled at any time prior to age 62, the disability pension shall be discontinued and the Participant shall be entitled to additional pension benefits only in accordance with the other provisions in the Plan.

    Section 4.5 - Early Commencement of Benefits.  A Participant who qualifies under Section 4.4 and has at least ten years of Vesting Service may elect a reduced monthly benefit which is in lieu of the aforesaid benefit, with the first payment to be made as of the first day of any month after his attainment of age 55 and prior to his Normal Retirement Date and the  last payment as of the first day of the month in which his death occurs.  The benefit payable from such earlier commencement date shall be the pension benefit payable in the normal form (as determined under Section 4.1):

(a)      reduced by six and two-thirds (6/2/3%) percent reduction per year for the five years immediately prior to age 65; and

(b)      reduced by three and one-third (3-1/3%) percent reduction per year for an additional five years.

    Section 4.6 - Minimum Benefit.  In no event will the benefit determined in Section 4.1, 4.2, 4.3 or 4.4 and payable from Normal Retirement Date be less than the Accrued Benefit under the Former Plan as of the Effective Date.

    Section 4.7 - Benefits that Matured Prior to the Effective Date.  Benefits, if any, payable on account of a Participant's Termination of Employment prior to the Effective Date shall be  determined and paid in accordance with the provisions of the Plan in effect as of the date of his Termination of Employment.

    Section 4.8 - Non-Duplication of Benefits.  In the event that a Participant terminates covered employment under the Collective Bargaining Agreement but continues in the employment of the Employer or the Company in a different position, the Participant shall not accrue any additional Accrual Service under this Plan unless the Participant later resumes covered employment under the Collective Bargaining Agreement.  In addition, the Accrued Benefit defined under Section 2.3 of the Plan shall be calculated for that Participant who terminated employment with the Employer as of the date the Participant ceased to be an Eligible Employee covered by the Collective Bargaining Agreement and not the date the Participant later terminates non-covered employment with the Employer or the Company.  In the event that the Participant is re-employed and is an Eligible Employee covered by the Collective Bargaining Agreement, and received Accrual Service after a one-year Break in Service, the Accrued Benefit calculated under Section 2.3 of the Plan shall be calculated based on the applicable Accrued Benefit at the time of the earlier termination times the years of Accrual Service at that time plus later years of Accrual Service times the applicable Accrued Benefit rate in effect under the Plan at the subsequent Termination of Employment.  In addition, notwithstanding any other provisions of the Plan, benefits otherwise payable to a Participant under Section 4.1, 4.3 or 4.4 shall be suspended during such period as he receives long or short term disability benefits provided by the Employer or the Company and during periods of re-employment with the Employer prior to the Participant's Normal Retirement Date.  Any benefits payable subsequent to Termination of Employment will be actuarially adjusted to reflect the payments already received.

    Section 4.9 - Optional Forms of Benefit Payments.  In lieu of the amount and form of pension payable under Section 4.1, 4.3 or 4.4, a Participant may, under such rules and regulations as the Trustees may prescribe which are in accord with the advice of the Actuary, and subject to the provisions of Section 4.10 and 4.16, elect to have a pension benefit payable in any of the following optional forms:

(a)      Ten (10) Year Certain and Life Benefit.  A reduced monthly benefit payable to the Participant for his or her life, with the provision that, if the Participant dies before having received 120 monthly payments, such reduced monthly payments will continue to the Participant's designated Beneficiary until the number of monthly payments made to the Participant and the Participant's designated Beneficiary total 120;

(b)      Joint and Fifty (50%) Percent Survivor Benefit.  A reduced monthly benefit payable to the Participant for his or her life, with the provision that, if the Participant is survived by his or her contingent annuitant, one-half of such reduced monthly benefit will be continued to the contingent annuitant for the duration of the contingent annuitant's life; and

(c)      Joint and One Hundred (100%) Percent Survivor Benefit.  A reduced monthly benefit payable to the Participant for his or her life, with the provision that, if the Participant is survived by his or her contingent annuitant, such reduced monthly benefit will be continued to the contingent annuitant for the duration of the contingent annuitant's life.

The amount of the benefit available under any of the options set forth in this Section shall be calculated by applying the reduction factors set forth in Appendix A to this Pension Plan.  Benefit payments under any option elected in accordance with the terms of this paragraph shall commence on the same date that benefit payments would otherwise commence under Section 4.1, 4.3, 4.4 or 4.5, whichever is applicable.  In conjunction with the Participant's election of an optional benefit under subsections (b) or (c), the Participant must designate, in form prescribed by the Trustees, a contingent annuitant to receive the survivor benefits thereunder; provided, that, if the designation is not made at that time, a designation may be made at a later date, but not after the commencement of benefit payments to the Participant.  Notwithstanding other provisions of this paragraph to the contrary, if a Participant dies before his or her payments have commenced, the Trustees shall not make payment to a Beneficiary who is not the Participant's spouse for a period which exceeds five (5) years from the date of the Participant's death.

    If a Participant remains in the employ of the Company after his Normal Retirement Date, and if his death occurs thereafter prior to his Termination of Employment, and if he elected an optional form of benefit payment under this Section which was not revoked prior to his death, the same benefit shall be provided his Beneficiary or joint or contingent annuitant under the option as though the Participant's Termination of Employment had occurred on his Normal Retirement Date and he had received monthly payments under the option for each month prior to his death.

    Section 4.10 - Qualified Joint and Survivor Annuity.  Unless a Participant elects otherwise, as hereinafter specified in Section 4.16, benefits shall be paid in the form of a Qualified Joint and Survivor Annuity with respect to any Participant who has a spouse and who -

(a)      begins to receive benefit payments under Section 4.1, 4.3, 4.4 or 4.5, or

(b)      dies on or after attaining Normal Retirement Age and prior to his or her Termination of Employment, or

(c)      ceases to be an Eligible Employee on or after the date he is entitled to receive benefits under Sections 4.1 or 4.4 and thereafter dies before beginning to receive such benefits.

A "Qualified Joint and Survivor Annuity" is an annuity for the life of the Participant with a survivor annuity for the life of his spouse which is 50% of the amount payable for the life of the Participant.  The amount of the benefit available under this Section shall be calculated by applying the reduction factors set forth in Appendix A to this Plan, under the Option "Joint and 50% Survivor."

    Section 4.11 - Pre-Retirement Spouse Annuity.

(a)      Eligibility. If a married Participant dies prior to commencement of payment of his Nonforfeitable Accrued Benefit, the Trustee will distribute to the Participant's surviving spouse a pre-retirement survivor annuity, unless the Participant and his spouse were not married throughout the one (1) year period ending on the date of his death.  This Section shall apply to a Participant who dies after August 22, 1984, and either (i) completes at least one (1) Hour Worked with the Employer after August 22, 1984, or (ii) separated from Service with at least ten (10) years of service and completed at least one (1) Hour Worked with the Employer in a Plan Year beginning after December 31, 1975.  If a Participant's death benefit is payable on or after the Effective Date and this Section does not apply to the Participant, the Plan Administrator shall make payment of the Participant's entire Nonforfeitable Accrued Benefit in accordance with Sections 4.10 and 4.15, subject to the requirements of subsection (c) hereof.

For a Participant dying after the earliest retirement age under the Plan, the pre-retirement spouse annuity shall equal the survivor annuity portion of the qualified joint and fifty (50%) percent survivor annuity the Trustees would have paid under Section 4.10 if the Participant had commenced receiving the qualified joint and survivor annuity the day before his death.  For a Participant dying on or before the earliest retirement age under the Plan, the pre-retirement survivor annuity shall equal the survivor annuity portion of the qualified joint and fifty (50%) percent survivor annuity the Trustees would have paid under Section 4.10 if the Participant had separated from service on the date of his death, had commenced receiving the qualified joint and survivor annuity at the earliest retirement age under the Plan, and had died the day after attaining the earliest retirement age under the Plan.  The "earliest retirement age under the Plan" is the earliest date on which the Plan permits the Participant to elect to receive retirement benefits.  Notwithstanding the immediately preceding provisions of this paragraph, if the actuarial equivalent of the pre-retirement spouse annuity calculated under the formula set forth in Section 2.4 is not greater than $5,000, (using the GATT interest rates in effect as of retirement) the Trustees will pay the Participant's surviving spouse the actuarial equivalent in a single lump sum payment as a complete settlement of all obligations under this Plan.

The Trustees shall commence payment of the pre-retirement spouse annuity on or before the later of one (1) year after the Participant's death or the date the Participant would have attained age seventy and one-half (70-1/2) unless the Participant's surviving spouse files an election to commence payment at some earlier date.

(b)      No Reduction of Pension Benefits.  A Participant's pension benefits shall not be reduced as a result of the pre-retirement spouse annuity coverage required under Section 4.11(a) or the survivor's annuity coverage under Section 4.11(c).  The Plan shall bear the cost of providing the pre-retirement spouse annuity or the survivor's annuity benefits.

(c)      Payment of Certain Survivor Benefits After the 1/1/2001.  If a married Participant who is not subject to Section 4.11(a) but who has received credit for at least one (1) Hour Worked after September 1, 1974, has a death benefit payable on or after the Effective Date, the Participant's surviving spouse shall receive a spouse's pre-retirement annuity if:

(1)      the Participant had made a spouse's annuity election at any time during the spouse annuity election period; and

(2)      dies while employed as an Eligible Employee of the Employer on or after attaining qualified early retirement age.  The spouse annuity election period shall begin on the ninetieth (90^th) day before the Participant attains the qualified early retirement age and shall end on the date of the Participant's Termination of Employment.  A Participant's "qualified early retirement age" is the later of the first day of the one hundred twentieth (120^th) month beginning before the Participant attains Normal Retirement Age, or the date on which the Participant began participation under this Plan.

Furthermore, if a married Participant who is not subject to Section 4.11(a) but who has received credit for at least one (1) Hour Worked after September 1, 1974, has a death or termination benefit payable on or after the Effective Date, the Participant's surviving spouse shall receive a spouse's annuity if:

(3)      the Participant dies on or after Normal Retirement Age while employed  by the Employer, or has a Termination of Employment on or after attaining his qualified early retirement age but dies before the Trustee commences payment of his pension; and

(4)      the Participant (and, for elections made after December 31, 1984, the Participant's spouse) has not waived the qualified joint and survivor annuity during the ERISA election period.  The ERISA election period begins on the later of (i) the date one hundred and eighty (180) days prior to the Participant's attaining qualified early retirement age, or (ii) the date the Participant commenced participation in the Plan, and ends on the Participant's annuity starting date under Section 4.10.

The spouse's pre-retirement annuity shall equal the survivor annuity portion of the qualified joint and survivor annuity payable under Section 4.10 determined as if the Participant had retired the day before his death and commenced receiving the qualified joint and survivor annuity.

    Section 4.12 - Payment of Small Amounts.

(a)      If the actuarially equivalent present value of a Participant's vested Accrued Benefit does not exceed Five Thousand Dollars ($5,000) and did not exceed such amount at the time of any previous distribution of such benefit, the benefit shall be paid to the Participant or to his or her surviving spouse following the Participant's death in a single lump sum payment no later than sixty (60) days after the close of the Plan Year following the Plan Year in which the Participant terminates employment or dies, whichever occurs first.  Actuarially equivalent lump sum values shall be calculated on the basis of (1) the mortality table based on the prevailing commissioners' standard table (described in section 807(d)(5)(A) of the Code, which is the mortality table prescribed in Revenue Ruling 95-6 for distributions with an annuity starting date before December 31, 2002 and the mortality table prescribed in Revenue Ruling 2001-62 for distributions with an annuity starting date on or after December 31, 2002)) used to determine reserves for group annuity contracts issued on the date as of which the lump sum is being determined (without regard to any other subparagraph of section 807(d)(5)), as prescribed by the Commissioner of Internal Revenue in revenue rulings, notices or other guidance and (2) for any lump sum payment made during a calendar year, an interest rate equal to the annual interest rate on 30-year Treasury securities for the November immediately preceding such calendar year as such rate is prescribed by the Commissioner of Internal Revenue in revenue rulings, notices or other guidance.

(b)      In the case of any distribution pursuant to this section that constitutes an "eligible rollover distribution," within the meaning of section 402(c)(4) of the Internal Revenue Code, the Trustees will, if so instructed by the distributee in accordance with uniform rules, make the distribution to an "eligible retirement plan" within the meaning of section 402(c)(8) of the Internal Revenue Code.  The foregoing provision will not apply if (i) the aggregate taxable distribution to be made to the distributee from this Plan during the distributee's taxable year is less than Two Hundred Dollars ($200) or (Ii) if less than the entire taxable amount of the distribution is to be distributed to an eligible retirement plan and the amount to be distributed to the eligible retirement plan is less than five Hundred Dollars ($500).

    Section 4.13 - No Other Benefits.  In the event the Trustees distribute any part or all of  a Participant's Accrued Benefit to him and the Participant later resumes active employment with the Employer, the Trustee shall compute the Participant's Accrued Benefit by taking into account all of the Participant's Years of Participation.  However, the Trustee shall offset the Participant's Accrued Benefit so computed by the Participant's Accrued Benefit attributable to any distribution the Trustee has made to the Participant.

    Section 4.14 - Maximum Benefits.  The maximum benefit, when expressed as a monthly pension, shall not exceed $7,500.00, subject to the following:

(a)      The maximum shall apply to the single-life pension computed under Article IV.

(b)      If benefits begin prior to age 65, the maximum will apply to such reduced pension; provided that, if benefits begin prior to age 55, the maximum will apply to a pension beginning at age 55, which is the Actuarial Equivalent of such benefit.

(c)      If the Participant has fewer than ten years of credited service at retirement, the applicable maximum shall be multiplied by a fraction, of which the numerator is his Accrual Service and the denominator is 10.

(d)      The maximum amount of $7,500.00 per month shall be increased as permitted in Section 415(b) of the Internal Revenue Code.

    Notwithstanding the foregoing with respect to a Participant included under the prior provisions of the Plan, the maximum computed under this subsection shall not be less than the Pension payable under the Plan provisions in effect as of December 31, 1982 based upon his rate of compensation under the Plan in effect as of such date and on Accrual Service to the date of his Termination of Employment.

    Section 4.15 - Death Benefit.  Upon the death of a Participant who has ten (10) or more years of Vesting Service and who is an Eligible Employee whose employment with the Employer has not terminated or is a former Eligible Employee currently on leave of absence or laid off and maintaining his name on the Employer's seniority or recall list, the sum of Five Thousand and no/100s ($5,000.00) Dollars shall be paid in a single lump sum payment to the Participant's Beneficiary designated in accordance with Section 2.6 of this Plan.  However, if such Participant is married at the time of his death and has been married for the one year period immediately preceding his death, any benefits payable as a result of Participant's death shall be paid to his spouse unless his spouse has consented to the designation of another Beneficiary.  Such consent shall be notarized and submitted to the Plan Administrator.

    Section 4.16 - Manner of Election - Revocation for Joint and Survivor Annuity - Normal Retirement Age.  A Participant may make an election not to have his Accrued Benefit paid in the form of a Qualified Joint and Survivor Annuity under Section 4.10 at any time during the election period.  The election period shall begin on the date the Plan Administrator furnishes to the Participant the information required under the third paragraph of this Section 4.16 and shall end on the ninetieth (90^th) day before the Trustee commences to pay the Participant his Accrued Benefit.  If, within 60 days from the date the information was furnished as required by the preceding sentence, a Participant makes a request for additional information, the election period shall extend, to the extent necessary, to include the ninety (90) calendar days immediately following the date the Plan Administrator either mails or personally delivers the requested additional information to the Participant.  A Participant may revoke an election made under this Section 4.16 at any time during the election period, and thereafter may make a new election at any time within the election period.  For waiver elections made after December 31, 1984, a Participant's spouse (to whom the survivor annuity is payable under the Qualified Joint and Survivor Annuity) must consent in writing to the waiver election, acknowledging the effect of the election and such consent must be witnessed by a Notary Public.

    The Plan Administrator may accept as valid a waiver election which does not satisfy the spousal consent requirement described above if the Plan Administrator establishes the Participant does not have a spouse, the Plan Administrator is not able to locate the Participant's spouse, or other circumstances exist under which the Secretary of Treasury will excuse the consent requirement.

    The Plan Administrator shall furnish to each Participant and spouse eligible to receive a normal retirement pension a written general description of the Qualified Joint and Survivor Annuity, the Participant's right to make, and the effect of an election to waive the Joint and Survivor Annuity form of benefit, the rights of the Participant's spouse regarding the waiver election.  The written description shall include the financial effect upon the Participant's normal retirement pension (in terms of dollars per pension payment) of making an election not to receive payment in the form of a Qualified Joint and Survivor Annuity.  The Plan Administrator either shall mail or personally deliver the written description at such time to ensure its receipt by the Participant on or about the earlier of:

(a)      The date nine (9) months prior to the Participant's attaining Normal Retirement Age; or

(b)      The later of the date one hundred eighty (180) days prior to the Participant's satisfying the requirements for an early commencement of benefits under Section 4.5 or the date the Participant commences participation in the Plan.

    The Plan Administrator shall provide and prescribe the form for a Participant's written election and the spouse's consent under this Section 4.16.  The election form shall state clearly that the Participant is electing to receive all of his Accrued Benefit under the Plan in a form other than a Qualified Joint and Survivor Annuity.  An election, or revocation of an election, is effective as of the date filed with the Plan Administrator.

ARTICLE V

PLAN FINANCING

    Section 5.1 - Contributions. No contributions shall be required or permitted under the Plan from any Participant.  The Company and any participating Employer shall make contributions in such amounts and at such times as determined by the Company in accordance with a funding method and policy to be established by said Company which will be consistent with the minimum funding standards of ERISA.  Forfeitures arising under this Plan, shall be applied to reduce the cost of the Plan, not to increase the benefits otherwise payable to Participants.

    Section 5.2 - Retirement Fund.  All contributions made by the Company or a participating Employer under this Plan shall be paid to the Investment Manager, or if there is no Investment Manager, then to the corporate agent, or if there is no corporate agent, then to the Trustees and deposited in the Retirement Fund.  All assets of the Retirement Fund, including investment income, shall be retained for the exclusive benefit of Participants and their beneficiaries, shall be used to pay benefits to such persons or to pay administrative expenses to the extent not paid by the Company, and shall not revert or inure to the benefit of the Company.

    Notwithstanding anything herein to the contrary, upon the request of the Company or a participating Employer, a contribution which was conditioned upon qualification of the Plan or any amendment thereof under Section 401(a) of the Internal Revenue Code shall be returned to the Company or participating Employer within one year after the denial of the qualification.

ARTICLE VI

ACTUARY

    Section 6.1 - Appointment and Duties.  The Company shall appoint an individual or a corporation or a firm with at least one individual who is qualified or experienced in
performing actuarial services in the valuation, funding and administration of retirement, pension, or annuity plans and who is an enrolled Actuary as provided under ERISA to serve as the Actuary to perform the services set forth herein and to perform such additional services  with respect thereto as may be conferred by the Company and as are consistent with the provisions of the Plan.  All determinations of Actuarial Equivalent values permitted or required to be made under the Plan or otherwise shall be made only in accordance with the advice of the Actuary, and the rules, regulations, and tables relating thereto shall become effective only with the approval of the Actuary.

    Section 6.2 - Successors.  The Company shall have the right at any time to remove the Actuary then acting, to appoint a successor or successors, and to fill vacancies in the office of the Actuary.

ARTICLE VII

ADMINISTRATION

    Section 7.1 - Allocation of Responsibility Among Fiduciaries for Plan and Retirement Fund Administration.  The Fiduciaries shall have only those specified powers, duties, responsibilities and obligations as are specifically given to them under this Plan or the Retirement Fund.  In general, the Company and any participating Employers shall have the sole responsibility for making the contributions necessary to provide benefits under the Plan as specified in Article VII.

    The Trustees shall have the sole responsibility for the administration of the Plan and Retirement Fund and the management of the assets held under the Retirement Fund, all as specifically provided in the Retirement Fund.  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 Retirement Fund, 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 Retirement Fund, and is not required under this Plan or the Retirement Fund to inquire into the propriety of any such direction, information or action.  It is intended under this Plan and the Retirement Fund  that each Fiduciary shall be responsible for the proper exercise of its own powers, duties, responsibilities and obligations under this Plan and the Retirement Fund and shall not be responsible for any act or failure to act of another Fiduciary.  No Fiduciary guarantees the Retirement Fund in any manner against investment loss or depreciation in asset value.

    Section 7.2 - Facility of Payment.  Whenever, in the Trustees' opinion, a person entitled to receive any payment of a benefit or installment thereof hereunder is under a legal disability or is incapacitated in any way so as to be unable to manage his financial affairs, the Trustees may direct payments to such person or to his legal representative or to a relative or friend of such person for his benefit, or the Trustees may apply the payment for the benefit of such person in such manner as the Trustees consider advisable.  Any payment of a benefit or installment thereof in accordance with the provisions of this Section shall be a complete discharge of any liability for the making of such payment under the provisions of the Plan.

    Section 7.3 - Discretionary Authority.  The Plan Administrator appointed by the Trustees pursuant to this document shall have the discretion and authority to make all decisions necessary and useful to interpret and administer this Plan.  Decisions of the Plan Administrator shall be final and binding.  The Plan Administrator shall have the power to delegate any and all responsibility for administering the Plan.  However, such delegation shall not relieve the Plan Administrators of its responsibilities under this Plan.

ARTICLE VIII

MISCELLANEOUS

    Section 8.1 - Non-Guarantee of Employment.  Nothing contained in this Plan shall be construed as a contract of employment between the Company or the Employer and any Eligible Employee, or as a right of any Eligible Employee to be continued in the employment of the Company or the Employer, or as a limitation of the right of the Company of the Employer to discharge any of its employees, with or without cause.

    Section 8.2 - Rights to Retirement Fund Assets.  No Eligible Employee shall have any right to, or interest in, any assets of the Retirement Fund upon Termination of Employment or otherwise, except as provided from time to time under this Plan, and then only to the extent of the benefits payable under the Plan to such employee out of the assets of the Retirement Fund.  In case of termination or partial termination of this Plan, the rights of all affected Participants to their Accrued Benefit to the extent funded as of the date of such termination or partial termination, shall be nonforfeitable.  Except as otherwise may be provided under Title IV of ERISA, all payments of benefits as provided for in this Plan shall be made solely out of the assets of the Retirement Fund and none of the Fiduciaries shall be liable therefor in any manner.

    Section 8.3 - Non-Alienation of Benefits.  Subject to Section 8.4, benefits payable under this Plan shall not be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, charge, garnishment, execution or levy of any kind, either voluntary or involuntary, including any such liability which is for alimony or other payments for the support of a spouse or former spouse or for any other relative of the Participant, prior to actually being received by the person entitled to the benefit under the terms of the Plan; and any attempt to anticipate, alienate, sell, transfer, assign, pledge, encumber, charge or otherwise dispose of any right to benefits payable hereunder, shall be void.  The Retirement Fund shall not in any manner be liable for, or subject to, the debts, contracts, liabilities, engagements or torts of any person entitled to benefits hereunder.

    Section 8.4 - Distributions Under Domestic Relations Orders.  Nothing contained in this Plan shall prevent the Trustees and the Plan Administrator from complying with the provisions of a qualified domestic relations order (as defined in Code §414(p)).

    The Plan Administrator shall establish reasonable procedures to determine the qualified status of a domestic relations order.  Upon receiving a domestic relations order, the Plan Administrator promptly shall notify the Participant and any alternate payee named in the order, in writing, of the receipt of the order and the Plan's procedures for determining the qualified status of the order.  Within a reasonable period of time after receiving the domestic relations order, the Plan Administrator shall determine the qualified status of the order and shall notify the Participant and each alternate payee, in writing, of its determination.  The Plan Administrator shall provide notice under this paragraph by mailing to the individual's address specified in the domestic relations order, or in a manner consistent with Department of Labor regulations.  The Plan Administrator may treat as qualified any domestic relations order entered prior to January 1, 1985, irrespective of whether it satisfies all the requirements described in Code §414(p).

    If any portion of the Participant's nonforfeitable Accrued Benefit is payable during the period the Plan Administrator is making its determination of the qualified status of the domestic relations order, the Trustees shall segregate the amounts payable in a separate account and invest the segregated account solely in fixed income investments.  If the Plan Administrator determines the order is a qualified domestic relations order within eighteen (18) months of receiving the order, the Trustees shall distribute the segregated account in accordance with the order.  If the Plan Administrator does not make its determination of the qualified status of the order within eighteen (18) months after receiving the order, the Trustees shall distribute the segregated account in the manner the Plan would distribute if the order did not exist and shall apply the order prospectively if the Plan Administrator later determines the order is a qualified domestic relations order.

    The Trustees shall make any payments or distributions required under this Section 8.4 by separate benefit checks or other separate distribution to the alternate payee(s).

ARTICLE IX

AMENDMENTS

    Section 9.1 - Amendment.  The Trustees may amend or modify this Plan at any time provided no amendment shall be adopted which alters the basic purpose of this Plan or the Retirement Fund; conflicts with the terms of any Collective Bargaining Agreement or with any applicable law; causes the use or diversion of any part of the Retirement Fund for purposes other than those authorized herein; increases the burdens or obligations of the Company or causes a reversion of any of the assets of the Retirement Fund to the Company or to the Union.  Furthermore, the Trustees and Plan Administrator shall neither enact nor apply any amendment to the Plan to reduce a Participant's Accrued Benefit immediately before the effective date of the amendment, except to the extent permitted under Code §412(c)(8).  An amendment adopted after July 30, 1984, decreases a Participant's Accrued Benefit determined immediately prior to the adoption date if the amendment has the effect of either (1) eliminating or reducing an early retirement benefit or a retirement-type subsidy (as defined in Treasury regulations), or (2) except as provided by Treasury regulations, eliminating an optional form of benefit.  The Plan Administrator shall disregard an amendment described in the immediately preceding sentence to the extent application of the amendment would decrease the Participant's Accrued Benefit determined immediately prior to the adoption date of the amendment.

ARTICLE X

SUCCESSOR COMPANY AND MERGER OR CONSOLIDATION OF PLANS

    Section 10.1 - Successor Company.  In the event of the dissolution, merger, consolidation or reorganization of the Company, provision may be made by which the Plan and Retirement Fund will be continued by the successor; and, in that event, such successor shall be substituted for the Company under the Plan.  The substitution of the successor shall constitute an assumption of Plan Liabilities by the successor and the successor shall have all the powers, duties, and responsibilities of the Company under the Plan.

    Section 10.2 - Plan Assets.  In the event of any merger or consolidation of the Plan with, or transfer in whole or in part of the assets and liabilities of the Retirement Fund to another Trust Fund held under, any other plan of deferred compensation maintained or to be established for the benefit of all or some of the Participants of this Plan, the assets of the Retirement Fund applicable to such Participants shall be transferred to the other Retirement Fund only if:

(a)      each Participant would (if either this Plan or the other plan then terminated) 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 before the merger, consolidation or transfer (if this Plan had then terminated);

(b)      resolutions of the Board of Directors of the Company under this Plan, and of any new or successor company of the affected Participants, shall authorize such transfer of assets; and, in the case of the new or successor company of the affected Participants, its resolutions shall include an assumption of liabilities with respect to such Participants' inclusion in the new company's plan; and

(c)      such other plan and trust are qualified under Sections 401(a) and 501(a) of the Internal Revenue Code.

ARTICLE XI

TOP HEAVY PROVISIONS

    Section 11.1 - Top Heavy Plan Requirements.  With respect to any portion of this Plan which covers Participants who are not covered by the Collective Bargaining Agreement ("Non-Bargaining Unit Participants"), for any Top Heavy Plan Year, the Plan shall provide the special vesting requirements of Code Section 416(b) pursuant to Section 11.3 of the Plan and the special minimum benefit requirements of Code Section 416(c) pursuant to Section 11.4 of the Plan.

    Section 11.2 - Determination of Top Heavy Status.

(a)      The portion of this Plan benefitting the Non-Bargaining Unit Participants shall be a Top Heavy Plan for any Plan Year commencing after December 31, 1982 in which, as of the Determination Date, (1) the Present Value of Accrued Benefits of Key Employees and (2) the sum of the Aggregate Accounts of Key Employees under this Plan and all plans of an Aggregation Group, exceeds sixty percent (60%) of the Present Value of Accrued Benefits and the Aggregate Accounts of all Key and Non-Key Employees under this Plan and all plans of an Aggregation Group.

    If any Participant is a Non-Key Employee for any Plan Year, but such Participant was a Key Employee for any prior Plan Year, such Participant's Present Value of Accrued Benefit and/or Aggregate Account balance shall not be taken into account for purposes of determining whether this Plan is a Top Heavy or Super Top Heavy Plan (or whether any Aggregation Group which includes this Plan is a Top  Heavy Group).  In addition, for Plan Years beginning after December 31, 1984, if a Participant or Former Participant has not performed any services for any Employer maintaining the Plan at any time during the five year period ending on the Determination Date, any accrued benefit for such Participant or Former Participant shall not be taken into account for the purposes of determining whether this Plan is a Top Heavy or Super Top Heavy Plan.

(b)      This Plan shall be a Super Top Heavy Plan for any Plan Year commencing after December 31, 1983 in which, as of the Determination Date, (1) the Present Value of Accrued Benefits of Key Employees and (2) the sum of the Aggregate Accounts of Key Employees under this Plan and all plans of an Aggregation Group, exceeds ninety percent (90%) of the Present value of Accrued Benefits and the Aggregate Accounts of all Key and Non-Key Employees under this Plan and all plans of an Aggregation Group.

(c)      Aggregate Account: A Participant's Aggregate Account as of the Determination Date shall be determined under applicable provisions of the defined contribution plan used in determining Top Heavy Plan status.

(d)      "Aggregation Group" means either a Required Aggregation Group or a Permissive Aggregation Group as hereinafter determined.

(1)      Required Aggregation Group: In determining a Required Aggregation Group hereunder, each plan of the Employer in which a Key Employee is a participant in the Plan Year containing the Determination Date or any of the four preceding Plan years, and each other plan of the Employer which enables any plan in which a Key Employee participates to meet the requirements of Code Sections 401(a)(4) or 410, will be required to be aggregated.  Such group shall be known as a Required Aggregation Group.

In the case of a Required Aggregation Group, each plan in the group will be considered a Top Heavy Plan if the Required Aggregation Group is a Top Heavy Group.  No plan in the Required Aggregation Group will be considered a Top Heavy Plan if the Required Aggregation Group is not a Top Heavy Group.

(2)      Permissive Aggregation Group: The Employer may also include any other plan not required to be included in the Required Aggregation Group, provided the resulting group, taken as a whole, would continue to satisfy the provisions of Code Sections 401(a)(4) and 410.  Such group shall be known as a Permissive Aggregation Group.

In the case of a Permissive Aggregation Group, only a plan that is part of the Required Aggregation Group will be considered a Top Heavy Plan if the Permissive Aggregation Group is a Top Heavy Group.  No plan in the Permissive Aggregation Group will be considered a Top Heavy Plan if the Permissive Aggregation Group is not a Top Heavy Group.

(3)      Only those plans of the Employer in which the Determination Dates fall within the same calendar year shall be aggregated in order to determine whether such plans are Top Heavy Plans.

(4)      An Aggregation Group shall include any terminated plan of the Employer if it was maintained within the last five (5) years ending on the Determination Date.

(e)      "Determination Date" means (a) the last day of the preceding Plan Year, or (b) in the case of the first Plan Year, the last day of such Plan Year.

(f)       "Present Value of Accrued Benefit:" In the case of a defined benefit plan, a Participant's Present Value of Accrued Benefit shall be determined:

(1)      In the case of a Participant other than a Key Employee, using the single accrual method used for all plans of the Employer and Affiliated Employers, or if no such single method exists, using a method which results in benefits accruing not more rapidly than the slowest accrual rate permitted under Code Section 411(b)(1)(C).

(2)      As of the most recent "accrual valuation date", which is the most recent valuation date within a twelve (12) month period ending on the Determination Date.

(3)      For the first Plan Year, as if (a) the Participant terminated service as of the Determination Date; or (b) the Participant terminated service as of the actuarial valuation date, but taking into account the estimated Accrued Benefits as of the Determination Date.

(4)      For the second Plan Year, the Accrued Benefit taken into account for a current participant must not be less than the Accrued Benefit taken into account for the first Plan Year unless the difference is attributable to using an estimate of the Accrued Benefit as of the Determination Date for the first Plan year and using the actual Accrued Benefit for the second Plan Year.

(5)      For any other Plan Year, as if the Participant terminated service as of the actuarial valuation date.

(6)      The actuarial valuation date must be the same date used for computing the defined benefit plan minimum funding costs, regardless of whether a valuation is performed that Plan Year.

(g)      The calculation of a Participant's Present Value of Accrued Benefit as of a Determination Date shall be the sum of:

(1)      The Present Value of Accrued Benefit using the actuarial assumptions of Section 2.4, which assumptions shall be identical for all defined benefit plans being tested for Top Heavy Plan status.

(2)      Any Plan distributions made within the Plan Year that includes the Determination Date or within the four (4) preceding Plan Years.  However, in the case of distributions made after the valuation date and prior to the Determination Date, such distributions are not included as distributions for top heavy purposes to the extent that such distributions are already included in the Participant's Present Value of Accrued Benefit as of the valuation date.  Notwithstanding anything herein to the contrary, all distributions, including distributions made prior to January 1, 1984, and distributions under a terminated plan which if it had not been terminated would have been required to be included in an Aggregation Group, will be counted.  Further, benefits paid on account of death, to the extent such benefits do not exceed the Present Value of Accrued Benefits existing immediately prior to death, shall be treated as distributions for the purposes of this paragraph.

(3)      Any Employee contributions, whether voluntary or mandatory.  However, amounts attributable to tax deductible Qualified Voluntary Employee Contributions shall not be considered to be a part of the Participant's Present Value of Accrued Benefit.

(4)      With respect to unrelated rollovers and plan-to-plan transfers (ones which are both initiated by the Employee and made from a plan maintained by one employer to a plan maintained by another employer), if this Plan provides the rollovers or plan-to-plan transfers, it shall always consider such rollovers or plan-to-plan transfers as a distribution for the purposes of this Section.  If this Plan is the plan accepting such rollovers or plan-to-plan transfers, it shall not consider such rollovers or plan-to-plan transfers accepted after December 31, 1983, as part of the Participant's Present Value of Accrued Benefit.  However, rollovers or plan-to-plan transfers accepted prior to January 1, 1984, shall be considered as part of the Participant's Present Value of Accrued Benefit.

(5)      With respect to related rollovers and plan-to-plan transfers (ones either not initiated by the Employee or made to a plan maintained by the same employer), if this Plan provides the rollovers or plan-to-plan transfers, it shall not be counted as a distribution for purposes of this Section.  If this Plan is the plan accepting such rollovers or plan-to-plan transfers, it shall consider such rollovers or plan-to-plan transfers as part of the Participant's Present Value of Accrued Benefit, irrespective of the date on which such rollovers or plan-to-plan transfers are accepted.

(6)      For the purposes of determining whether two employers are to be treated as the same employer in (4) and (5) above, all employers aggregated under Code Section 414(b), (c), (m) or (o) are treated as the same employer.

(h)      "Top Heavy Group" means an Aggregation Group in which, as of the Determination Date, the sum of:

(1)      The Present Value of Accrued Benefits of Key Employees under all defined benefit plans included in the group, and

(2)      The Aggregate Accounts of Key Employees under all defined contribution plans included in the group, exceeds sixty percent (60%) of a similar sum determined for all Participants.

(i)       "Aggregate Account" means, with respect to each Participant, the value of all accounts maintained on behalf of a Participant, whether attributable to Employer or Employee contributions, used to determine Top Heavy Plan status under the provisions of a defined benefit contribution plan included in any Aggregation Group (as defined in this Plan).

(j)       "Key Employee" means an Employee as defined in Code Section 416(i) and the Regulations thereunder.  Generally, any Employee or former Employee (as well as each of his Beneficiaries) is considered a Key Employee if he, at any time during the Plan Year that contains the "Determination Date" or any of the preceding four (4) Plan Years, has been included in one of the following categories:

(1)      An officer of the Employer (as that term is defined within the meaning of the Regulations under Code Section 416) having annual "415 Compensation" greater than 50 percent of the amount in effect under Code Section 415(b)(1)(A) for any such Plan Year.

(2)      One of the ten employees having annual "415 Compensation" from the Employer for a Plan Year greater than the dollar limitation in effect under Code Section 415(c)(1)(A) for the calendar year in which such Plan Year ends and owning (or considered as owning within the meaning of Code Section 318) both more than one-half percent interest and the largest interests in the Employer.

(3)      A "five percent owner" of the Employer.  "Five percent owner" means any person who owns (or is considered as owning within the meaning of Code Section 318) more than five percent (5%) of the outstanding stock of the Employer or stock possessing more than five percent (5%) of the total combined voting power of all stock of the Employer or, in the case of any unincorporated business, any person who owns more than five percent (5%) of the capital or profits interest in the Employer.  In determining percentage ownership hereunder, employers that would otherwise be aggregated under Code Sections 414(b), (c), (m) and (o) shall be treated as separate employers.

(4)      A "one percent owner" of the Employer having an annual "415 Compensation" from the Employer of more than $150,000.  "One percent owner" means any person who owns (or is considered as owning within the meaning of Code Section 318) more than one percent (1%) of the outstanding stock of the Employer or stock possessing more than one percent (1%) of the total combined voting power of all stock of the Employer or, in the case of an unincorporated business, any person who owns more than one percent (1%) of the capital or profits interest in the Employer.  In determining percentage ownership hereunder, employers that would otherwise be aggregated under Code Sections 414(b), (c), (m) and (o) shall be treated as separate employers.  However, in determining whether an individual has "415 Compensation" of more than $150,000, "415 Compensation" from each employer required to be aggregated under Code Sections 414(b), (c), (m) and (o) shall be taken into account.

For purposes of this Section, the determination of "415 Compensation" shall be made by including amounts that would otherwise be excluded from a Participant's gross income by reason of the application of Code Sections 125, 402(a)(8), 402(h)(1)(B) and, in the case of Employer contributions made pursuant to a salary reduction agreement, by including amounts that would otherwise be excluded from a Participant's gross income by reason of the application of Code Section 403(b).

(k)      "Non-Key Employee" means any Employee or former Employee (and his Beneficiaries) who is not a Key Employee.

(l)       "Super Top Heavy Plan" means a plan described in Section 11.2.

(m)     "Top Heavy Plan" means a plan described in Section 11.2.

(n)      "Top Heavy Plan Year" means a Plan Year commencing after December 31, 1983 during which a portion of the Plan is a Top Heavy Plan.

    Section 11.3 - Vesting if a Portion of the Plan Becomes Top Heavy.

    Notwithstanding the vesting otherwise provided for in the Plan for any Top Heavy Plan Year, the Vested portion of the Accrued Benefit of any Non-Bargaining Unit Participant who has an Hour of Service after the Plan becomes top heavy shall be a percentage of such Participant's number of years of Service according to the following schedule:

Vesting Schedule

Years of Service                    Percentage

  0-2                                         0%

      3                                     100%

    If in any subsequent Plan Year, the portion of the Plan benefiting Non-Bargaining Unit Participants ceases to be a Top Heavy Plan, the Administrator shall revert to the vesting schedule in effect before this Plan became a Top Heavy Plan.  Any such reversion shall be treated as a Plan amendment pursuant to the terms of the Plan.

    Section 11.4 - Minimum Benefit Requirement If a Portion of the Plan Becomes Top Heavy.

(a)      The minimum Accrued Benefit derived from Employer contributions to be provided under this Section for each Non-Key Employee who is a Non-Bargaining Unit Participant during a Top Heavy Plan Year shall equal the product of (1) one-twelfth (1/12th) of "415 Compensation" averaged over the five (5) consecutive "limitation years" (or actual number of "limitation years", if less) which produce the highest average and (2) the lesser of (i) two percent (2%) multiplied by Plan Years of Service or (ii) twenty percent (20%).

(b)      For purposes of providing the minimum benefit under Code Section 416, a Non-Key Employee who is not a Non-Bargaining Unit Participant solely because (1) his Compensation is below a stated amount or (2) he declined to make mandatory contributions to the plan will be considered to be a Participant.  Furthermore, such minimum benefit shall be provided regardless of whether such Non-Key Employee is employed on a specified date.

(c)      For purposes of this Section, Plan years of Service for any Plan Year beginning before January 1, 1984, or for any Plan Year during which the Plan was not a Top Heavy Plan shall be disregarded.

(d)      For purposes of this Section, "415 Compensation" for any "limitation year" ending in a Plan Year which began prior to January 1,1984, subsequent to the last "limitation year" during which the Plan is a Top Heavy Plan, or in which the Participant failed to complete a Plan Year of Service, shall be disregarded.

(e)      For the purposes of this Section, "415 Compensation" shall be limited to $200,000 (unless adjusted in such manner as permitted under Code Section 415(d)).  However, for Plan Years beginning prior to January 1, 1989, the $200,000 limit shall apply only for Top Heavy Plan Years and shall not be adjusted.

(f)       If the Plan provides for the Normal Retirement Benefit to be paid in a form other than a single life annuity, the Accrued Benefit under this Section shall be the Actuarial Equivalent of the minimum Accrued Benefit under (a) above pursuant to Section 2.3.

(g)      If payment of the minimum Accrued Benefit commences at a date other than Normal Retirement Date, the minimum Accrued Benefit shall be the Actuarial  Equivalent of the minimum Accrued Benefit commencing at Normal Retirement Date pursuant to Section 2.3.

(h)      To the extent required to be nonforfeitable under this Plan, the minimum Accrued Benefit under this Section may not be forfeited under Code Section 411(a)(3)(B) or Code Section 411(a)(3)(D).

ARTICLE XII

RESTRICTIONS ON BENEFITS PAYABLE TO HIGHLY

COMPENSATED PARTICIPANTS

    Section 12.1 - IRS Limitations.  This Article sets forth limitations required by the Internal Revenue Service on the pension benefits payable to certain Participants.  It shall apply to a Participant only if his anticipated annual pension exceeds $1,500.00 and the Participant was among the 25 highest paid employees of the Company on (a) January 1, 1973; or (b) the date of the most recent amendment which substantially increased pension benefits (a "Substantive Amendment Date").  The limitations set forth in this Article shall become applicable if:

(a)      The Plan is terminated within ten years after January 1, 1973 (or a Substantive Amendment Date, if applicable);

(b)      The Pension of a Participant becomes payable within such ten year period, or

(c)      The Pension of a Participant becomes payable after such ten year period and the full current costs for the ten year period have not been funded.

    If subparagraph (b) above is applicable, the restrictions shall remain in effect until the later of the expiration of the ten year period or the date on which the full current costs have been funded.

    If a Participant is subject to the provisions of this Article, the Pension payable to him shall not exceed the Pension which can be provided from the greatest of the following:

(a)      The Company's contributions (or funds attributable thereto) which would have been applied to provide benefits for the Participant if the Plan had not been amended on the Substantive Amendment Date and had not continued without change;

(b)      $20,000.00; or

(c)      The sum of (1) the Company's contributions (or funds attributable thereto) which would have been applied to provide benefits for the Participant if the Plan had been terminated on the day before the Substantive Amendment Date (if applicable) and (2) an amount computed by multiplying the number of years for which the current costs of the Plan have been met after January 1, 1973 (or the Substantive Amendment Date, if applicable), by 20% of the first $50,000.00 of the Participant's average annual compensation during his last 5 years of employment.

    The limitations described above may be exceeded for the purposes of making current benefit payments to retired Participants who would otherwise be subject to such restrictions, provided that (a) the contributions which may be used for any such retired Participant in accordance with the restrictions heretofore indicated are applied to provide either a level amount of pension in the basic form of benefit provided for under the Plan for such Participant, or a level amount of pension in an optional form of benefit not greater in amount than the level amount of Pension under the basic form of benefit, and (b) the pension thus provided is supplemented by monthly payments to the extent necessary to provide the full pension in the basic form called for by the Plan, and (c) such supplemental payments are made only if the full current costs of the Plan have been met or if the aggregate of such supplemental payments for all such retired Participants does not exceed the aggregate Company contributions already made under the Plan in the year then current.

    The limitations in this Article shall automatically become inoperative and of no effect upon a ruling by the Internal Revenue Service that they are not required.

ARTICLE XIII

PLAN TERMINATION

    Section 13.1 - Right to Terminate.  In accordance with the procedures set forth in this Article, the Company and the Union have the right to terminate the Plan at any time.  In the event of the dissolution, merger, consolidation or reorganization of the Company, the Plan shall terminate and the Retirement Fund shall be liquidated unless the Plan is continued by a successor to the Company in accordance with Section 10.1.  Subject to applicable requirements, if any, of ERISA governing termination of "Employee Pension Benefit Plans," the Trustees shall liquidate the Retirement Fund in accordance with the provisions of this Article.

    Section 13.2 - Partial Termination.  Upon termination of the Plan with respect to a group of Participants which constitutes a partial termination of the Plan, the Trustees shall allocate for the benefit of the Eligible Employees then or theretofore employed by the Employer with respect to which the Plan is being terminated the proportionate interest of such Participants in the Retirement Fund in the manner and the order set forth in Section 4044 of ERISA.  The Actuary shall make this determination on the basis of the contributions made by the Company, the provisions of this Article, and such other considerations as the Actuary deems appropriate.  The Fiduciaries shall have no responsibility with respect to the determination of any such proportionate interest.

    Section 13.3 - Liquidation of Retirement Fund.  Upon termination of the Plan, or upon termination of employment of a group of Participants constituting a partial termination of the Plan, each such Participant's Accrued Benefit, based on his Accrual Service prior to the date of termination shall become fully vested and nonforfeitable to the extent funded.  Upon complete termination of the Plan, the assets of the Retirement Fund shall be liquidated (after provision is made for the expenses of liquidation), subject to the requirements of PBGC by the payment or provision for the payment of benefits in the following order of preference:

(a)      Certain Benefits Payable Three Years Prior to Termination: The available assets of the Retirement Fund shall first be allocated to provide pensions that became payable three or more years before the effective date of Plan termination, or that could have become payable at the beginning of such three year period had the Participant not deferred the commencement of his Pension by failing to elect earlier commencement, or that could have become payable had a Participant's retirement occurred immediately prior to the beginning of such three year period, provided that:

(i)       The portion of the pension payable to a Participant or the beneficiary of a Participant (or that could have been payable) shall be based on the provisions of the Plan in effect five years prior to the effective date of Plan termination; and for this purpose, the first Plan Year in which an amendment became effective, or was adopted, if later, shall constitute the first year an amendment was in effect; and further provided that:

(ii)      If the pension payable under the Plan had been reduced, either by amendment or due to the form in which the pension is being paid, during the three year period ending on the effective date of Plan termination, then the lowest benefit in pay status during such three year period shall be considered the benefit in pay status for purposes of this category (a).

(b)      Other Benefits Eligible for Termination Insurance: To the extent that the amount of a pension has not been provided in the foregoing category (a), the remaining assets shall be allocated to provide any pension provided under the Plan for a Participant whose employment terminated prior to the effective date of Plan termination, or any immediate or deferred pension that would have been payable to or on behalf of a Participant had his employment terminated for a reason other than death on the effective date of Plan termination, provided that the amount of a pension to be provided under this category (b) shall be determined as follows:

(i)       The portion of the pension payable to a Participant or the beneficiary of a Participant (or that could have been payable) based on the provisions of the Plan in effect five years prior to the effect date of Plan termination; and for this purpose, the first Plan Year in which an amendment became effective, or was adopted, if later, shall constitute the first year an amendment was in effect; plus

(ii)      The portion of the pension payable to a Participant or the beneficiary of a Participant which would have been included in (i) above had the Plan or a Plan amendment been in effect five years prior to the effective date of Plan termination, determined as follows: 20% for each Plan Year (less than five) that the Plan or an amendment thereto was in effect, multiplied by the amount that would have been included under subparagraph (1) for such Participant or beneficiary had the Plan or the  amendment been in effect for five Plan Years as of the effective date of Plan termination;

(iii)     No benefit payable under this category (b) to a Participant or beneficiary shall exceed an amount with an actuarial value of a monthly benefit in the form of a life only annuity commencing at age 65 equal to $750.00 multiplied by a fraction, the numerator of which is the contribution and benefit base determined under Section 230 of the Social Security Act in effect at the effective date of Plan termination and the denominator of which is such contribution and benefit base in effect in calendar year 1974.

(c)      Other Vested Benefits: To the extent that the amount of a pension has not been provided in the foregoing categories (a) and (b), the remaining assets in the Retirement Fund shall be allocated to provide the benefit payable under the Plan to or on behalf of a Participant whose employment terminated prior to the effective date of Plan termination, or that would have been payable to or on behalf of a Participant had his employment terminated for a reason other than death on the effective date of Plan termination, in the following order of preference:

(i)       to any Participant who had retired under Section 4.1 prior to the effective date of Plan termination or who was eligible to retire under said Section on the effective date of Plan termination;

(ii)      to any Participant who had retired under Section 4.3 prior to the effective date of Plan termination or who was eligible to retire under said Section on the effective date of Plan termination; or

(iii)     to any Participant whose employment had terminated with entitlement to a deferred vested pension under Section 4.4 prior to the effective date of Plan termination or who would have been eligible for a deferred vested pension under said Section had his employment terminated on the effective date of Plan termination.

(d)      Other Benefits: To the extent that the amount of pension has not been provided in the foregoing categories (a), (b) and (c), the remaining assets shall be allocated to provide the benefit accrued under the Plan, without regard to the satisfaction of the vesting requirements of this Plan, with respect to each Participant whose employment had not terminated as of the effective date of Plan termination, according to the respective actuarial value of each such Participant's Accrued Benefit.

    If the assets of the Retirement Fund applicable to any of the above categories are insufficient to provide full benefits for all persons in such group, the benefits otherwise payable to such persons shall be reduced proportionately.  The Actuary shall calculate the allocation of the assets of the Retirement Fund in accordance with the above priority categories, and certify his calculations to the Fiduciaries.  No liquidation of assets and payment of benefits (or provision therefor) shall actually be made by the Trustee until after it is advised by the Company in writing that applicable requirements, if any, of ERISA governing termination of "Employee Pension Benefit Plans" have been, or are being complied with or that appropriate authorizations, waivers, exemptions or variances have been, or are being, obtained.

    Section 13.4 - Manner of Distribution.  Subject to the foregoing provisions of Article XIII and applicable PBGC rules, any distribution after termination of the Plan may be made, in whole or in part, to the extent that no discrimination in value results, in cash, in securities or other assets in kind, or in non-transferable annuity contracts, as the Trustees, in their discretion, shall determine.

    Section 13.5 - Residual Amounts.  In no event shall the Company or any participating Employer receive any amounts from the Retirement Fund upon termination of the Plan.  After satisfaction of all liabilities of the Plan, any amounts which remain shall be distributed to Participants according to the following formula: To each Participant, a fraction of the Retirement Fund's residual assets equal to the fraction attained when the numerator is the Participant's total Years of Accrual Service and the denominator is the total years of Accrual Service for all Participants in the Plan.

ARTICLE XIV

CONSTRUCTION

    Section 14.1 - Construction.  The masculine gender, where appearing in the Plan, shall be deemed to include the feminine gender, and the singular may include the plural, unless the context clearly indicates to the contrary.  The words "hereof", "herein", "hereunder", and other similar compounds of the word "here" shall mean and refer to the entire Plan, not to any particular provision or Section.

    Section 14.2 - Authority of Trustees: In discharging the duties assigned to them under this Plan, the Trustees and, to the extent authority has been delegated to the Plan Administrator and his or her delegates, all of such persons and his or her delegates have the discretion and final authority to interpret and construe the terms of the Plan; to determine coverage and eligibility for benefits under the Plan; and to make all other determinations deemed necessary or advisable for the discharge of their duties or the administration of the Plan.  The discretionary authority of the Trustees, the Plan Administrator and their respective delegates is final, absolute, conclusive and exclusive, and binds all parties so long as it is exercised in good faith.  It is specifically intended that judicial review of any decision of the Trustees, the Plan Administrator or their delegates be limited to the arbitrary and capricious standard of review.

GRAPHIC COMMUNICATIONS                           BMC INDUSTRIES, INC.

INTERNATIONAL UNION, TWIN                        

CITIES LOCAL 6A

By: /s/C. David Jara                                                     By: /s/Brad Carlson
 

UNION TRUSTEES:                                                 COMPANY TRUSTEES:

/s/C. David Jara                                                           /s/Wesley S. Cohen

/s/Brian C. Moser                                                        /s/Dennis Malecek

/s/Richard W. Pruden                                                  /s/Brad Carlson

/s/Donald F. Schuldt                                                   /s/Cynthia Wingert

Dated as of this 18th day of June, 2002.

EX-10.48 9 exhibit_10-48.htm  

AMENDMENT 1

TO THE

SEVENTH RESTATED GRAPHIC COMMUNICATIONS

INTERNATIONAL UNION, TWIN CITIES

LOCAL 6A - BUCKBEE-MEARS PENSION PLAN

These amendments reflect the applicable provisions of the model amendments to comply with the Economic Growth and Tax Relief Reconciliation Act of 2001, as amended ("EGTRRA"), released by the Internal Revenue Service in IRS Notice 2001-57, are intended as good faith compliance with the requirements of EGTRRA, and are to be construed in accordance with EGTRRA and guidance issued thereunder.

Pursuant to Article IX of the Seventh Restated Graphic Communications International Union, Twin Cities Local 6A - Buckbee-Mears Pension Plan, hereinafter referred to as the "Plan", the Trustees hereby amend said Plan as follows:

I.

A new subsection 4.14(e) is hereby added to the Plan to read in its entirety as follows:

"(e)    (i)    Effective Date.  Notwithstanding the foregoing to the contrary, this section shall be effective for limitation years ending after December 31, 2001.

(ii)    Effect on Participants.  Benefit increases resulting from the increase in the limitations of section 415(b) of the Code will be provided to all employees participating in this Plan who have one (1) Hour of Service ending after December 31, 2001.

Definitions.

(iii)    Defined benefit dollar limitation.  The "defined benefit dollar limitation" is $160,000, as adjusted, effective January 1 of each year, under section 415(d) of the Code in such manner as the Secretary shall prescribe, and payable in the form of a straight life annuity.  A limitation as adjusted under section 415(d) of the Code will apply to limitation years ending with or within the calendar year for which the adjustment applies.

(iv)Maximum permissible benefit.  The "maximum permissible benefit" is the lesser of the defined benefit dollar limitation or defined benefit compensation limitation (both adjusted where required, as provided in (a) and, if applicable, in (b) or (c) below).

(a)    If the Participant has fewer than 10 years of participation in the Plan, the defined benefit dollar limitation shall be multiplied by a fraction, (i) the numerator of which is the number of years (or part thereof) of participation in the Plan and (ii) the denominator of which is 10.  In the case of a Participant who has fewer than 10 years of service with the employer, the defined benefit compensation limitation shall be multiplied by a fraction, (i) the numerator of which is the number of years (or part thereof) of service with the employer and (ii) the denominator of which is 10.

(b)    If the benefit of a Participant begins prior to age 62, the defined benefit dollar limitation applicable to the Participant at such earlier age is an annual benefit payable in the form of a straight life annuity beginning at the earlier age that is the actuarial equivalent of the defined benefit dollar limitation applicable to the Participant at age 62 (adjusted under (a) above, if required).  The defined benefit dollar limitation applicable at an age prior to age 62 is determined as the lesser of (i) the actuarial equivalent (at such age) of the defined benefit dollar limitation computed using the interest rate and mortality table (or other tabular factor) specified in Section 4.12(a) and (ii) the actuarial equivalent (at such age) of the defined benefit dollar limitation computed using a 5 percent interest rate and the applicable mortality table as defined in Section 4.12(a) of the Plan.  Any decrease in the defined benefit dollar limitation determined in accordance with this paragraph (b) shall not reflect a mortality decrement if benefits are not forfeited upon the death of the Participant.  If any benefits are forfeited upon death, the full mortality decrement is taken into account.

(c)    If the benefit of a Participant begins after the Participant attains age 65, the defined benefit dollar limitation applicable to the Participant at the later age is the annual benefit payable in the form of a straight life annuity beginning at the later age that is actuarially equivalent to the defined benefit dollar limitation applicable to the Participant at age 65 (adjusted under (a) above, if required).  The actuarial equivalent of the defined benefit dollar limitation applicable at an age after age 65 is determined as (i) the lesser of the actuarial equivalent (at such age) fo the defined benefit dollar limitation computed using the interest rate and mortality table (or other tabular factor) specified in Section 4.12(a) of the Plan and (ii) the actuarial equivalent (at such age) of the defined benefit dollar limitation computed using a 5 percent interest rate assumption and the applicable mortality table as defined in Section 4.12(a) of the Plan.  For these purposes, mortality between age 65 and the age at which benefits commence shall be ignored.

II.

A new subsection 4.12(c) is hereby added to the Plan to read in its entirety as follows:

"(c)    Effective for distributions made after December 31, 2001, for purposes of the direct rollover provisions of this Section 4.12, an eligible retirement plan shall also mean an annuity contract described in section 403(b) of the Code and an eligible plan under section 457(b) of the Code which is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state and which agrees to separately account for amounts transferred into such plan from this Plan.  The definition of eligible retirement plan shall also apply in the case of a distribution to a surviving spouse, or to a spouse or former spouse who is the alternate payee under a qualified domestic relations order, as defined in section 414(p) of the Code."

III.

Section 11.5 is hereby added to the Plan to read in its entirety as follows:

11.5  Modifications of Top-Heavy Rules effective after December 31, 2001.

(a) Effective date.  This section shall apply for purposes of determining whether the Plan is a top-heavy plan under section 416(g) of the Code for Plan Years beginning after December 31, 2001, and whether the Plan satisfies the minimum benefits requirements of section 416(c) of the Code for such years.  This section amends Article XI of the Plan.

(b)Determination of top-heavy status.

1.    Key employee.  Key employee means any employee or former employee (including any deceased employee) who at any time during the Plan Year that includes the determination date was an officer of the employer having annual compensation greater than $130,000 (as adjusted under section 416(i)(1) of the Code for Plan Years beginning after December 31, 2002), a 5-percent owner of the employer, or a 1-percent owner of the employer having annual compensation of more than $150,000.  For this purpose, annual compensation means compensation of more than $150,000.  For this purpose, annual compensation means compensation within the meaning of section 415(c)(3) of the Code.  The determination of who is a key employee will be made in accordance with section 416(i)(1) of the Code and the applicable regulations and other guidance of general applicability issued thereunder.

2.    Determination of present values and amounts.  This section (b)(2) shall apply for purposes of determining the present values of accrued benefits and the amounts of account balances of employees as of the determination date.

(i)    Distributions during year ending on the determination date.  The present values of accrued benefits and the amounts of account balances of an employee as of the determination date shall be increased by the distributions made with respect to the employee under the Plan and any plan aggregated with the Plan under section 416(g)(2) of the Code during the 1-year period ending on the determination date.  The preceding sentence shall also apply to distributions under a terminated plan which, had it not been terminated, would have been aggregated with the Plan under section 416(g)(2)(A)(i) of the Code.  In the case of a distribution made for a reason other than separation from service, death, or disability, this provision shall be applied by substituting 5-year period for 1-year period.

(ii)    Employees not performing services during year ending on the determination date.  The accrued benefits and accounts of any individual who has not performed services for the employer during the 1-year period ending on the determination date shall not be taken into account.

(c)    Minimum benefits.  For purposes of satisfying the minimum benefit requirements of section 416(c)(1) of the Code and the Plan, in determining years of service with the employer, any service with the employer shall be disregarded to the extent that such service occurs during a Plan Year when the Plan benefits (within the meaning of section 410(b) of the Code) no key employee or former key employee.

IV.

Except as amended herein, the terms and provisions of the Seventh Restated Graphic Communications International Union, Twin Cities Local 6A - Buckbee-Mears Pension Plan, shall be and remain in full force and effect.

V.

This Amendment shall be effective as provided herein.

IN WITNESS WHEREOF, the Trustees have caused this Amendment 1 to the Seventh Restated Graphic Communications International Union, Twin Cities Local 6A - Buckbee-Mears Pension Plan to be executed as of this 30st  day of December, 2002.

GRAPHIC COMMUNICATIONSBMC INDUSTRIES, INC.

INTERNATIONAL UNION, TWIN

CITIES LOCAL 6A

By:  /s/C. David Jara                                       By: /s/Brad Carlson

UNION TRUSTEES:                                           COMPANY TRUSTEES:

/s/C. David Jara                                                   /s/Wesley S. Cohen

/s/Brian C. Moser                                                /s/Dennis Malecek

/s/Richard W. Pruden                                           /s/Brad Carlson

/s/Donald F. Schuldt                                            /s/John Oyen

Dated this 31st day of December, 2002.

EX-21.1 10 exhibit_21-1.htm

EXHIBIT 21-1

SUBSIDIARIES

OF

BMC INDUSTRIES, INC.

1.     Buckbee-Mears Europe GmbH

2.     Buckbee-Mears Hungary Kft.

3.     Buckbee-Mears Medical Technologies, LLC

4.     Vision-Ease Lens, Inc.

5.     Vision-Ease Lens Azusa, LLC

6.     Vision Ease Lens Limited

7.     Vision-Ease Canada, Ltd.

8.     P. T. Vision-Ease Asia, joint venture with P.T. Astron Lensindo Nusa

9.     Buckbee-Mears Holding Company B.V.

10.   Buckbee-Mears European Holding Company B.V.

11.   Buckbee-Mears Deutschland Holding GmbH & Company KG

12.   Vision-Ease France SAS

13.   Vision-Ease Deutschland GmbH

14.   Buckbee-Mears Deutschland Verwaltungs GmbH

15.   Buckbee-Mears Netherlands B.V.

EX-23.1 11 exhibit_23-1.htm

Exhibit 23.1

Consent of Independent Auditors

We consent to the incorporation by reference in the Registration Statement (Form S-8 No. 33-55089) pertaining to the BMC Industries, Inc. 1994 Stock Incentive Plan, in the Registration Statement (Form S-8, No. 33-38684) pertaining to the BMC Industries, Inc. Restated and Amended 1994 Stock Incentive Plan and in the Registration Statement (Form S-8, No. 333-81952) pertaining to the BMC Industries, Inc. Savings and Profit Sharing Plan of our report dated January 31, 2003 with respect to the consolidated financial statements of BMC Industries, Inc. included in the Annual Report (Form 10-K) for the year ended December 31, 2002.

/s/Ernst & Young LLP

Minneapolis, Minnesota

March 25, 2003

EX-99.1 12 exhibit_99-1.htm

EXHIBIT 99.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS 

ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of BMC Industries Inc (the "Company") on Form 10-K for the period ended December 31, 2002 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Douglas C. Hepper, Chief Executive Officer of the Company, certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

     1)       The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

     2)       The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

March 26, 2003

/s/Douglas C. Hepper

Douglas C. Hepper

Chairman, President and

Chief Executive Officer

EX-99.2 13 exhibit_99-2.htm

EXHIBIT 99.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS 

ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of BMC Industries Inc (the "Company") on Form 10-K for the period ended December 31, 2002 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Curtis E. Petersen, Chief Financial Officer of the Company, certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

     1)       The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

     2)       The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

March 25, 2003

/s/Curtis E. Petersen

Curtis E. Petersen

Senior Vice President and

Chief Financial Officer 

-----END PRIVACY-ENHANCED MESSAGE-----

EX-10.5

BMC INDUSTRIES, INC.

SAVINGS AND PROFIT SHARING PLAN

2001 REVISION

Third Declaration of Amendment

Pursuant to the retained power of amendment contained in Section 11.2 of the BMC Industries, Inc. Savings and Profit Sharing Plan - 2001 Revision, the Plan is amended in the manner set forth below to reflect certain provisions of the Economic Growth and Tax Relief Reconciliation Act of 2001 ("EGTRRA").  This amendment is intended as good faith compliance with the requirements of EGTRRA and is to be construed in accordance with EGTRRA and Treasury Regulations.  Except as this amendment provides otherwise, this amendment will be effective as of January 1, 2002.  This amendment will supersede the provisions of the Plan to the extent those provisions are inconsistent with the provisions of this amendment.

1)     Effective for limitation years beginning after December 31, 2001, the aggregate annual additions that may be contributed or allocated to a Participant's account under the Plan for any Plan Year will not exceed the lesser of:

(a)   $40,000, as adjusted for increases in the cost-of-living under Code section 415(d), or

(b)  100 percent of the Participant's Section 415 Wages for the Plan Year.  The compensation limit referred to in this clause (b) will not apply to any contribution for medical benefits after separation from service (within the meaning of Code sections 401(h) or 419A(f)(2)) that is otherwise treated as an annual addition.

2)     The Eligible earnings and Testing Wages of a Participant taken into account for any Plan Year beginning after December 31, 2001, will not exceed $200,000, as adjusted for cost-of-living increases in accordance with Code section 401(a)(17)(B).  The cost-of-living adjustment in effect for a calendar year applies to Eligible Earnings and Testing Wages for the determination period that begins with or within such calendar year.

3)     The term "key employee" means any employee or former employee (including any deceased employee) who, at any time during the Plan Year that includes the determination date, was an officer of an Affiliated Organization having annual compensation greater than $130,000 (as adjusted under Code section 416(i)(1) for Plan Years beginning after December 31, 2002), a 5-percent owner of the Affiliated Organization, or a 1-percent owner of the Affiliated Organization having annual compensation of more than $150,000.  For this purpose annual compensation means compensation within the meaning of Code section 415(c)(3).  The determination of key employees will be made in accordance with Code section 416(i)(1) of the Code and Treasury Regulations.

4)     In determining if the Plan is a top-heavy plan, the present values of accrued benefits and the amounts of account balances of an employee as of the determination date will be increased by the distributions made with respect to the employee under the Plan and any plan aggregated with the Plan under Code section 416(g)(2) during the 1-year period ending on the determination date.  The preceding sentence will also apply to distributions under a termination plan which, had it not been terminated, would have been aggregated with the Plan under Code section 416(g)(2)(A)(i).  If a distribution is made for a reason other than separation from service, death, or disability, this provision will be applied by substituting "5-year period" for "1-year period."  The accrued benefits and accounts of any individual who has not performed services for the Affiliated Organization during the 1-year period ending on the determination date will not be taken into account.

5)     If the Plan is a top-heavy plan, Matching Contributions will be taken into account for purposes of satisfying the minimum contribution requirements of Code section 416(c)(2) and the Plan.  The preceding sentence will apply with respect to Matching Contributions under the Plan or, if the Plan provides that the minimum contribution requirement will be met in another plan, such other plan.  Matching Contributions that are used to satisfy the minimum contribution requirements will be treated as matching contributions for purposes of the actual contribution percentage test and other requirements of Code section 401(m).

6)     Effective for distributions made after December 31, 2001, for purposes of the direct rollover provisions in Section 8.7, an eligible retirement plan will also mean an annuity contract described in Code section 403(b) and an eligible plan under Code section 457(b) that is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state and that agrees to separately account for amounts transferred into such plan from this Plan.  The definition of eligible retirement plan will also apply in the case of a distribution to a surviving spouse, or to a spouse or former spouse who is the alternate payee under a qualified domestic relation order, as defined in Code section 414(p).  No amount that is distributed on account of hardship will be an eligible rollover distribution, and the distribute may not elect to have any portion of such a distribution paid directly to an eligible retirement plan.

7)     A portion of a distribution will not fail to be an Eligible Rollover Distribution merely because the portion consists of After-Tax Contributions that are not includible in gross income.  However, such portion may be transferred only to an individual retirement account or annuity described in section 408(a) or (b) of the Code or to a qualified defined  contribution plan described in section 401(a) or 403(a) of the Code that agrees to separately account for amounts so transferred, including separately accounting for the portion of such distribution that is includible in gross income and the portion of such distribution that is not so includible.

8)     The plan will accept Rollover contributions of Eligible Rollover Distributions made after December 31, 2001, from:

(a)   a qualified plan described in Code section 401(a) or 403(a), excluding after-tax employee contributions;

(b)  an annuity contract described in Code section 403(b), excluding after-tax employee contributions; or

(c)   an eligible plan under Code section 457(b) that is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state.

9)     The Plan will not accept a participant rollover contribution of the portion of a distribution from an individual retirement account or annuity described in section 408(a) or 408(b) of the Code that is eligible to be rolled over and would otherwise be includible in gross income, other than such an account or annuity that is solely a conduit for distributions from a qualified retirement plan, excluding after-tax employee contributions.

10)For purposes of Section 8.1(a) (involuntary distribution of vested Accounts of $5,000 or less), the value of a Participant's no forfeitable Account balances will be determined without regard to that portion of the Account balances that is attributable to a Participant's Profit Sharing Plan Rollover Account and Rollover contributions (and earnings allocable thereto) within the meaning of sections 402(c), 403(a)(4), 403(b)(8), 408(d)(3)(A)(ii), and 457(e)(16) of the Code.

11)The multiple use test described in Treasury Regulation section 1.401(m)-2 and Section 9.4 will not apply.

12)The top-heavy requirements of Code section 416 and Section 13.3 will not apply in any year beginning after December 31, 2001, in which the Plan consists solely of a cash or deferred arrangement which meets the design-based safe harbor alternative requirements of Code section 401(k)(12) and Matching Contributions with respect to which the design-based safe harbor alternative requirements of Code section 401(m)(11) are met.

13)A Participant who receives a hardship withdrawal of 401(k) Contributions after December 31, 2001, will be prohibited from making 401(k) Contributions and After-Tax Contributions under this Plan and elective deferrals and after-tax employee contributions under any other plans maintained by any Affiliated Organization for 6 months after receipt of the hardship withdrawal.

14)A Participant's vested Account balances will become distributable following the Participant's severance from employment with all Affiliated Organizations.  Such a distribution will be subject to the other provisions of the Plan regarding distributions, other than provisions that require a separation from service before such amounts may be distributed.

IN WITNESS WHEREOF, the undersigned has caused this instrument to be executed this 31^st day of December, 2002.

                                                                                    BMC INDUSTRIES, INC.

Attest:  /s/Jon A. Dobson                                            by:  /s/Susan Linzmeier

            Secretary                                                         its: V.P. Human Resources

EX-10.26

BMC Buckbee-Mears St. Paul

A unit of BMC Industries, Inc.

278 East 7^th Street

St. Paul, MN 55101

(651) 228-6400 / (800)BMC-Etch

Fax (651) 228-6541

January 14, 2003

Mr. Henry Zaidan

President

GMT Corporation

245 E. Sixth Street

St. Paul, MN  55101-1918

Dear Henry,

Please accept this letter as official notice that Buckbee-Mears will terminate the lease for the PS-3 space on February 28, 2003.

Please contact me if you have any questions.

Sincerely,

/s/Dennis Malecek

Dennis Malacek

Director of Operations

651-228-6471

EX-10.47

THE SEVENTH RESTATED

GRAPHIC COMMUNICATIONS INTERNATIONAL UNION,

TWIN CITIES LOCAL 6A -

BUCKBEE-MEARS PENSION PLAN

Generally Effective January 1, 2001

TABLE OF CONTENTS

 NAME AND HISTORY OF PLAN........................................................................................... 1

    Section 1.1.................................................................................................................................. 1

ARTICLE II.................................................................................................................................... 1

    DEFINITIONS........................................................................................................................... 1

    Section 2.1.................................................................................................................................. 1

    Section 2.2 - Accrual Service...................................................................................................... 1

    Section 2.3 - Accrued Benefit...................................................................................................... 3

    Section 2.4 - Actuarial Equivalent................................................................................................ 4

    Section 2.5 - Actuary.................................................................................................................. 4

    Section 2.6 - Beneficiary.............................................................................................................. 4

    Section 2.7 - -  Break in Service.................................................................................................... 5

    Section 2.8 - Code...................................................................................................................... 5

    Section 2.9 - Collective Bargaining Agreement............................................................................. 5

    Section 2.10 - Company.............................................................................................................. 6

    Section 2.11 - Computation Periods............................................................................................ 6

    Section 2.12 - Effective Date....................................................................................................... 6

    Section 2.13 - Eligibility and Vesting Service................................................................................ 6

    Section 2.14 - Eligible Employee.................................................................................................. 7

    Section 2.15 - Employer.............................................................................................................. 8

    Section 2.16 - Employment Commencement Date........................................................................ 8

    Section 2.17 - ERISA................................................................................................................. 8

    Section 2.18 - Fiduciary.............................................................................................................. 8

    Section 2.19 - -  Former Plan......................................................................................................... 8

    Section 2.20 - Hours Worked..................................................................................................... 8

    Section 2.21 - Normal Retirement Date....................................................................................... 8

    Section 2.22 - Normal Retirement Age...................................................................................... 11

    Section 2.23 - PBGC................................................................................................................ 11

    Section 2.24 - Participant.......................................................................................................... 11

    Section 2.25 - Plan.................................................................................................................... 11

    Section 2.26 - Plan Administrator.............................................................................................. 11

    Section 2.27 - Plan Anniversary Date......................................................................................... 11

    Section 2.28 - Plan Year........................................................................................................... 11

    Section 2.29 - Re-Employment Commencement Date................................................................ 11

    Section 2.30 - Retirement Fund................................................................................................. 12

    Section 2.31 - Termination of Employment................................................................................. 12

    Section 2.32 - Trustees.............................................................................................................. 12

    Section 2.33 - Union................................................................................................................. 12

    Section 2.34- Vesting................................................................................................................ 12

ARTICLE III................................................................................................................................ 12

    EMPLOYEE PARTICIPATION.............................................................................................. 12

    Section 3.1 - Eligibility for Participation...................................................................................... 12

    Section 3.2 - Transfer to Eligible Employee Status...................................................................... 13

    Section 3.3 - Re-Employment after a Break in Service............................................................... 13

    Section 3.4 - Preservation of Pre-Break Service........................................................................ 13

ARTICLE IV................................................................................................................................ 14

    BENEFITS............................................................................................................................... 14

    Section 4.1 - Normal Retirement Benefit Formula....................................................................... 14

    Section 4.2 - Accrued Benefit.................................................................................................... 14

    Section 4.3 - Early Retirement Benefit........................................................................................ 14

    Section 4.4 - Benefit Upon Other Termination of Employment.................................................... 15

    Section 4.5 - Early Commencement of Benefits.......................................................................... 15

    Section 4.6 - Minimum Benefit................................................................................................... 16

    Section 4.7 - Benefits that Matured Prior to the Effective Date.................................................... 16

    Section 4.8 - Non-Duplication of Benefits.................................................................................. 16

    Section 4.9 - Optional Forms of Benefit Payments...................................................................... 16

    Section 4.10 - Qualified Joint and Survivor Annuity.................................................................... 17

    Section 4.11 - Pre-Retirement Spouse Annuity........................................................................... 18

    Section 4.12 - Payment of Small Amounts.................................................................................. 20

    Section 4.13 - No Other Benefits............................................................................................... 21

    Section 4.14 - Maximum Benefits.............................................................................................. 21

    Section 4.15 - Death Benefit...................................................................................................... 21

    Section 4.16 - Manner of Election - Revocation for Joint and Survivor Annuity -

    Normal Retirement Age............................................................................................................. 22

ARTICLE V.................................................................................................................................. 23

    PLAN FINANCING................................................................................................................ 23

    Section 5.1 - Contributions........................................................................................................ 23

ARTICLE VI................................................................................................................................ 23

    ACTUARY............................................................................................................................... 23

    Section 6.1 - Appointment and Duties........................................................................................ 23

    Section 6.2 - Successors........................................................................................................... 24

ARTICLE VII............................................................................................................................... 24

    ADMINISTRATION............................................................................................................... 24

    Section 7.1 - Allocation of Responsibility Among Fiduciaries for Plan and Retirement

    Fund Administration................................................................................................................... 24

    Section 7.2 - Facility of Payment................................................................................................ 24

    Section 7.3 - Discretionary Authority......................................................................................... 25

ARTICLE VIII............................................................................................................................. 25

    MISCELLANEOUS................................................................................................................. 25

    Section 8.1 - Non-Guarantee of Employment............................................................................. 25

    Section 8.2 - Rights to Retirement Fund Assets.......................................................................... 25

    Section 8.3 - Non-Alienation of Benefits.................................................................................... 25

    Section 8.4 - Distributions Under Domestic Relations Orders..................................................... 26

ARTICLE IX................................................................................................................................ 26

    AMENDMENTS...................................................................................................................... 26

    Section 9.1 - Amendment.......................................................................................................... 26

ARTICLE X.................................................................................................................................. 27

    SUCCESSOR COMPANY AND MERGER OR CONSOLIDATION OF PLANS............... 27

    Section 10.1 - Successor Company........................................................................................... 27

    Section 10.2 - Plan Assets......................................................................................................... 27

ARTICLE XI................................................................................................................................ 28

    TOP HEAVY PROVISIONS................................................................................................... 28

    Section 11.1 - Top Heavy Plan Requirements............................................................................ 28

    Section 11.2 - Determination of Top Heavy Status..................................................................... 28

    Section 11.3 - Vesting if a Portion of the Plan Becomes Top Heavy............................................ 33

    Section 11.4 - Minimum Benefit Requirement If a Portion of the Plan Becomes Top Heavy......... 34

ARTICLE XII............................................................................................................................... 35

ARTICLE XIII............................................................................................................................. 36

    PLAN TERMINATION........................................................................................................... 36

    Section 13.1 - Right to Terminate............................................................................................... 36

    Section 13.2 - Partial Termination.............................................................................................. 37

    Section 13.3 - Liquidation of Retirement Fund............................................................................ 37

    Section 13.4 - Manner of Distribution........................................................................................ 39

    Section 13.5 - Residual Amounts............................................................................................... 40

ARTICLE XIV.............................................................................................................................. 40

    CONSTRUCTION.................................................................................................................. 40

    Section 14.1 - Construction....................................................................................................... 40

    Section 14.2 - Authority of Trustees.......................................................................................... 40

ARTICLE I

NAME AND HISTORY OF PLAN

    Section 1.1 - THE GRAPHIC COMMUNICATIONS INTERNATIONAL UNION, TWIN CITIES LOCAL 6A - BUCKBEE-MEARS PENSION PLAN (formerly known as the Pension Plan of the Lithographers and Photoengravers International Union, Twin Cities Local 6A - Buckbee Mears Retirement Fund and more recently known as the Graphic Arts International Union, Twin Cities Local 6A - Buckbee-Mears Pension Plan) as set forth in the instrument dated the 27^th day of December 1968, amended January 1, 1975, restated January 1, 1976, amended and restated January 1, 1982, amended and restated January 1, 1984, amended and restated January 1, 1985, amended and restated January 1, 1989, and is hereby amended and restated in its entirety to be effective as of January 1, 2001.

ARTICLE II

DEFINITIONS

    Section 2.1 - All of the definitions contained in the Restated Agreement and Declaration of Trust of the GRAPHIC COMMUNICATIONS INTERNATIONAL UNION, TWIN CITIES LOCAL 6A - BUCKBEE-MEARS RETIREMENT FUND, formerly the Graphic Arts International Union, Twin Cities Local 6A - Buckbee Mears Retirement Fund, are incorporated into this Plan by reference.

    Section 2.2 - Accrual Service  The Accrual Service credited to a Participant will vary in accordance with the particular year in which such service was performed and the year in which said Participant's employment terminated.  Computations of Accrual Service shall include all Hours Worked by an Eligible Employee in an Accrual Computation Period.

(a)      For Participants who are laid off or who terminate employment with the Employer after December 31, 1984, Accrual Service after December 31, 1975 is accumulated at the rate of one (1) year for each Accrual Computation Period in which an Eligible Employee completes 1,800 or more Hours Worked.  If an Eligible Employee works at least 900 hours but less than 1,800 hours, he will be entitled to a fraction of one (1) year Accrual Service based upon the number of hours actually worked divided by 1,800 hours.  There will be no accumulation of Accrual Service for any complete Accrual Computation Period in which a Participant accumulates less than 900 Hours Worked.

(b)      For Participants who are laid off or who terminate employment with the Employer between January 1, 1981 and December 31, 1984, Accrual Service after December 31, 1975 is accumulated at the rate of one (1) year for each Accrual Computation Period in which an Eligible Employee completes 1,800 or more hours worked.  There will be no accumulation of Accrual Service for any complete Accrual Computation Period in which a Participant accumulates less than 975 hours.  If a Participant accumulates more than 975 hours, but less than 1,800 hours, he will be entitled to a fraction of one (1) year of Accrual Service based upon the number of hours actually worked divided by 1,950 hours.

(c)      In the case of a Participant who is laid off or terminates employment with the Employer    during the period from January 1, 1976 through December 1, 1980, an Eligible Employee shall have accumulated at least 975 hours during the computation period in order to receive any Accrual Service for that period.  An Eligible Employee working at least 975 hours but less than 1,950 hours in an Accrual Computation Period between January 1, 1976 and December 31, 1980, shall accrue a fraction of one (1) year of Accrual Service, the numerator being the number of hours actually worked and the denominator being 1,950 hours.

(d)      Accrual Service prior to January 1, 1976 shall be the service recognized for benefit accrual purposes under the terms of the Former Plan.  For each Plan Year from June 1, 1968 to May 31, 1975, service was accumulated as follows:

•         1 year of Accrual Service if at least 48 weekly payroll checks received from the Employer in a Plan Year.

•         3/4 of 1 year of Accrual Service if between 36 and 47 weekly payroll checks received from the Employer in a Plan Year.

•         ½ of 1 year of Accrual Service if between 24 and 35 weekly payroll checks received from the Employer in a Plan Year.

•         No credit if less than 24 weekly payroll checks received from the Employer in a Plan year.

(e)      For the short Plan Year June 1, 1975 to December 31, 1975, service was accumulated as follows:

•         58.33% of 1 year of Accrual Service if at least 28 weekly payroll checks received from the Employer in the Plan Year.

•         43.75% of 1 year of Accrual Service if between 21 and 27 weekly payroll checks received from the Employer in the Plan Year.

•         29.17% of 1 year of Accrual Service if between 14 and 20 weekly payroll checks received from the Employer in the Plan Year.

•         No credit if less than 14 weekly payroll checks received from the Employer in the Plan Year.

(f)       A Participant who retires on or after January 1, 1973 is entitled to a maximum of ten (10) Years of Service under this Plan for vesting and accrual purposes for employment with the Employer within the ten (10) years prior to June 1, 1968 provided that such service would otherwise qualify under the terms of this Plan.  For purposes of determining Accrual Service, years prior to June 1, 1968, shall be calculated pursuant to Section 2.2(d).

(g)      Service prior to June 1, 1958, shall not be counted for the purpose of calculating Accrual Service under this Plan.

    Section 2.3 - Accrued Benefit.  The Accrued Benefit for each Participant who on or after January 1, 2003:

(a)      terminates employment with the Employer:

(b)      is laid off; or

(c)      ceases being an Eligible Employee;

shall be $43.50 multiplied by the number of years of Accrual Service through December 31, 2001; plus, Hours Worked from January 1, 2002 through June 30, 2002 divided by 1800 hours multiplied by $43.50; plus, Hours Worked from July 1, 2002 through December 31, 2002 divided by 1800 multiplied by $21.75; plus $21.75 multiplied by the number of years of Accrual Service on or after January 1, 2003.  No Hours Worked in 2002 in excess of 1800 hours shall be included in these equations.  Pursuant to Section 2.2, there will be no accumulation of Accrual Service for any complete Accrual Computation Period in which a Participant accumulates less than 900 Hours Worked; in addition, if any Eligible Employee has less than 900 Hours Worked in the year 2002, he or she shall not be entitled to any benefit accrual for 2002.

    With respect to any Participant who terminated employment with the Employer or was laid off or ceased to be an Eligible Employee prior to January 1, 2003, the following Accrued Benefit shall be applicable for the following period of time:

2002                                      *

2001                                      $43.50 per year of Accrual Service

2000                                      $43.50 per year of Accrual Service

1999                                      $43.50 per year of Accrual Service

1998                                      $39.00 per year of Accrual Service

1997                                      $35.00 per year of Accrual Service

1996                                      $34.00 per year of Accrual Service

1995                                      $28.50 per year of Accrual Service

1991                                      $28.00 per year of Accrual Service

1990                                      $27.00 per year of Accrual Service

1989                                      $25.00 per year of Accrual Service

1988                                      $24.00 per year of Accrual Service

1987                                      $22.00 per year of Accrual Service

1986                                      $21.00 per year of Accrual Service

1985                                      $19.00 per year of Accrual Service

1984                                      $16.00 per year of Accrual Service

1983                                      $14.00 per year of Accrual Service

1982                                      $13.00 per year of Accrual Service

1981                                      $11.00 per year of Accrual Service

9/1/80 - 12/31/80                   $ 9.50 per year of Accrual Service, except for participants who terminated employment prior to 1/1/80.

*        $43.50 multiplied by the number of years of Accrual Service through December 31, 2001; plus, Hours Worked from January 1, 2002 through June 30, 2002 divided by 1800 hours multiplied by $43.50; plus, Hours Worked from July 1, 2002 through December 31, 2002 divided by 1800 multiplied by $21.75.  No Hours Worked in 2002 in excess of 1800 hours shall be included in these equations.  Pursuant to Section 2.2, there will be no accumulation of Accrual Service for any complete Accrual Computation Period in which a Participant accumulates less than 900 Hours Worked; in addition, if any Eligible Employee has less than 900 Hours  Worked  in the year 2002, he or she shall not be entitled to any benefit accrual for 2002.

    The Accrued Benefit of any Participant who terminated employment with the Employer on or before December 31, 1979 shall be the Accrued Benefit that was in effect in the Plan at the time of such termination.

    Section 2.4 -  Actuarial Equivalent.  In the event that a specific actuarial factor is not provided under this Plan, the appropriate actuarial equivalence factor shall be the actuarial factors issued by the Pension Benefit Guaranty Corporation for the first day of January of the year for which the actuarial equivalence is provided.  The factor shall use an average of the appropriate male and female factors.

    Section 2.5 -  Actuary.  The Actuary is the corporation, firm or individual appointed and acting from time to time pursuant to the terms of Article VI.

    Section 2.6 -  Beneficiary.  A Beneficiary is the person or persons, natural or otherwise, other than a joint or contingent annuitant, designated by a Participant to receive any benefit payable under the Plan in the event of his death.

    A Participant who has designated a Beneficiary may, without the consent of such Beneficiary, alter or revoke such designation.  However, the spouse of a Participant must consent to the naming of a Beneficiary other than himself or herself.  Such consent must be executed in the presence of a notary public.  To be effective, any Participant's designation, alteration, or revocation of a Beneficiary shall be in writing, in such form as the Trustees may prescribe, and shall be filed with the Trustees prior to the death of the Participant.  If, at the time a death benefit becomes payable, there is not on file with the Trustees a fully executed designation of Beneficiary with spousal consent where required, then the designated Beneficiary shall be the person or persons surviving him in the first of the following classes in which there is a survivor, share and share alike:

(a)      his spouse;

(b)      his children, except that if any of his children predecease him but leave issue surviving him, such issue shall take by right of representation the share their parent would have taken if living;

(c)      his parents;

(d)      his brothers and sisters;

(e)      his personal representative or representatives (executors and administrators).

The identity of each Beneficiary in each case shall be determined by the Trustees.  Each such determination shall be final and binding for all persons.  Should the Plan Administrator not have a valid consent by a spouse to the designation by a Participant of a Beneficiary other than the spouse, the Trustees will pay a Participant's benefits to the spouse.

    Section 2.7 -  Break in Service.  A Break in Service occurs only when an Eligible Employee receives no compensation and no vesting credit during a Vesting Computation Period.  Such compensation shall include direct and indirect compensation by the Employer for Hours Worked including sick pay, vacation pay, pay during a leave of absence, disability income, and such other indirect compensation as may be required to be recognized for Break in Service purposes under ERISA or rules or regulations related thereto.

    Section 2.8 -  Code.  Code means the Internal Revenue Code of 1986, as amended or replaced from time to time.

    Section 2.9 -  Collective Bargaining Agreement.  Collective Bargaining Agreement means the existing Collective Bargaining Agreement between Buckbee-Mears Saint Paul and the Union effective June 1, 1976 through May 31, 1978, as well as any extensions or renewals thereof, or any new Collective Bargaining Agreement executed in the future which provides for the payment of contributions to the Retirement Fund as well as any extension or renewal thereof.

    Section 2.10 - Company.  Company means BMC Industries, Inc.

    Section 2.11 - Computation Periods.

(a)      Eligibility Computation Periods - the 12-month period beginning with an employee's Employment Commencement Date, and the 12-month period commencing on any Plan Anniversary Date after his Employment Commencement Date.

(b)      Vesting and Accrual Computation Periods - the 12-month period commencing on the Plan Anniversary Date.

    Section 2.12 - Effective Date.  Except as specifically stated herein, the Effective Date of this Restatement is January 1, 2001.

    Section 2.13 - Eligibility and Vesting Service.

(a)      Eligibility Service after December 31, 1975 is accumulated at the rate of one year for each Eligibility Computation Period in which an Eligible Employee completes 1,000 or more Hours Worked.  There is no accumulation for an Eligible Employee for a Computation Period in which he has less than 1,000 Hours Worked.

(b)      Vesting Service after December 31, 1975 is accumulated at the rate of one year for each Vesting Computation Period in which an Eligible Employee completes 1,000 or more Hours Worked.  There is no accumulation for an Eligible Employee for a Vesting Computation Period in which he has less than 1,000 Hours Worked.

Except, in the event an Eligible Employee's first Eligibility Computation Period in which 1,000 or more Hours Worked are completed overlaps two Vesting Computation Periods, neither of which contains 1,000 or more Hours Worked by the Eligible Employee, the second such Vesting Computation Period will be deemed, for vesting purposes, to contain 1,000 hours.  There is no accumulation for any Vesting Computation Periods prior to the Vesting Computation Period in which the Eligible Employee attains the age of 18.

Notwithstanding the definition of "Hours Worked" contained in this Plan, all Hours Worked by an employee for the Employer, the Company and any other corporation that is a member of a controlled group of corporations, (within the meaning of Code section 1563(a) without regard to Code sections 1563(a)(4) and 1563(e)(3)(C)) that includes the Company, any trade or business (whether or not incorporated) that together with the Company is under common control (within the meaning of Code section 414(c)), any member of an "affiliated service group" (within the meaning of Code section 414(m)) of which the Company is a member or any other organization that, together with the Company, is treated as a single employer pursuant to Code section 414(o) and Treasury Regulations thereunder ("ERISA Affiliates"); provided, that, for purposes of applying the limitations set forth at Section 414, such determination under Code section 1563(a) will be made by substituting the phrase "more than 50 percent" for the phrase "at least 80 percent" wherever it appears in such Code section, and will be counted for Eligibility Service and Vesting Service purposes whether or not such employee was an Eligible Employee at the time the hours were worked.

Eligible Employees on an authorized military leave of absence will accumulate hours for Vesting and Eligibility Service at the rate of 40 hours for each seven (7) consecutive days of leave.

(c)      Vesting and Eligibility Service prior to January 1, 1976 for a Participant as of January 1, 1976, who had been covered under the Former Plan, will be the Participant's last period of continuous employment with the Company prior to January 1, 1976 rounded to the nearest year.

    Section 2.14 - Eligible Employee.

(a)      Except as provided in Subsection (b), an "Eligible Employee" is an employee who has performed services for the Employer as an employee of the Employer (as classified by the Company or the Employer at the time the services are performed without regard to any subsequent reclassification) for a period of at least sixty-six (66) working days covered by the Collective Bargaining Agreement and on whose behalf contributions are made to the Retirement Fund pursuant to the terms of the Collective Bargaining Agreement between Buckbee-Mears Saint Paul and the Union.

(b)      An individual who is classified by the Company or the Employer as an independent contractor, leased employee or as any other status in which the individual is not classified by the Company or the Employer as an employee of the Employer at the time services are performed is not an Eligible Employee.  No judicial or administrative reclassification, or reclassification by the Company or the Employer, will be applied to grant retroactive eligibility to any individual under the Plan.

(c)      In addition, Eligible Employee includes full-time officers and employees of the Union, the Retirement Fund, and any other benefit fund established by the Collective Bargaining Agreement, provided that contributions to the Retirement Fund are made on behalf of said Eligible Employees by their respective Employers.

    Section 2.15 - Employer.  Employer shall mean Buckbee-Mears Saint Paul (a unit of  the Company) and any employer of an Eligible Employee on whose behalf contributions are made into the Retirement Fund.  The Union, the Retirement Fund, and other benefit funds described in Section 2.14 hereof shall be deemed Employers for the limited purpose of making payments to the Retirement Fund on behalf of Eligible Employees (as defined in Section 2.14).

    Section 2.16 - Employment Commencement Date.  The date an Eligible Employee first works one hour for the Employer.

    Section 2.17 - ERISA.  The Employee Retirement Income Security Act of 1974, as amended from time to time.

    Section 2.18 - Fiduciary.  The named Fiduciary of the Plan is the Board of Trustees, the Investment Manager, the Plan Administrator, insurance company or companies, or combination thereof, appointed and acting from time to time in accordance with the provisions of Section 5.2 and Article VII and the  Retirement Fund, to hold, invest and disburse assets in the Retirement Fund and administer the Plan.

    Section 2.19 -  Former Plan.  The Former Plan is the Restated Graphic Communications International Union, Twin Cities Local 6A - Buckbee Mears Pension Plan in existence the day before the Effective Date of this Plan.

    Section 2.20 - Hours Worked.  Determined as follows:

(a)      For Eligible Employees whose hours are not required to be counted and recorded by any Federal Law such as the Fair Labor Standards Act, Hours Worked will be recorded at the rate of 45 for each 7 days of employment in covered employment during the Computation Period in which the Eligible Employee would be required under Subsection (c) hereof to be credited with at least one (1) Hour Worked.

(b)      For all other Eligible Employees, Hours Worked will be total Hours Worked computed in accordance with Subsection (c) hereof.

(c)      (1)      "Hours Worked" shall mean each hour worked for which the Employer, either directly or indirectly, pays an Eligible Employee, or for which the Eligible Employee is entitled to payment, for the performance of duties during the Plan Year.  The Eligible Employee shall be credited with the Hours Worked under this subparagraph (1) for the Plan Year in which the Eligible Employee performs the duties, irrespective of when paid;

        (2)      Each Hour Worked for back pay, irrespective of mitigation of damages, to which the Employer has agreed or for which the Eligible Employee has received an award.  Hours Worked shall be credited under this subparagraph (2) to the Eligible Employee for the Plan Year(s) to which the award or the agreement pertains rather than for the Plan Year in which the award, agreement or payment is made; and

        (3)      Each Hour Worked for which the Employer, either directly or indirectly, pays an Eligible Employee, or for which the Eligible Employee is entitled to payment (irrespective of whether the employment relationship is terminated), for reasons other than for the performance of duties during a Plan Year, such as leave of absence, vacation, holiday, sick leave, illness, incapacity (including disability and periods for which an Eligible Employee is entitled to receive workers' compensation benefits), layoff, jury duty or military duty.  Hours Worked shall be credited under this subparagraph (3) for the Plan Year in which the Employer pays the Eligible Employee, the Eligible Employee becomes entitled to payment or the payment becomes due, whichever first occurs.  Notwithstanding the preceding provisions of this subparagraph (3), Hours Worked shall not be credited for:

(i)       more than five hundred one (501) Hours Worked under subparagraph (c) to an Eligible Employee on account of any single continuous period during which the Eligible Employee does not perform any duties (whether or not such period occurs during a single Plan Year);

(ii)      hours for which payments are made or due to the Eligible Employee under a plan maintained solely for the purpose of complying with the applicable unemployment compensation law; and

(iii)     hours for which a payment to an Eligible Employee solely reimburses the Eligible Employee for medical or medically related expenses incurred by the Eligible Employee.

An Hour Worked shall not be credited under more than one of the above subparagraphs (1), (2) or (3) of subsection (c).  Furthermore, if the Eligible Employee is to be credited with Hours Worked for the twelve (12) month period beginning with the Eligible Employee's Employment Commencement Date, then the twelve (12) month period shall be substituted for the term "Plan Year" wherever the latter term appears in this Section 2.20.

(d)      Hours Worked shall also include all Hours Worked by any Eligible Employee for which the Eligible Employee receives compensation from the Union.  These hours represent lost time hours which, but for this subsection (d), the Eligible Employee would not otherwise be given credit.

Any ambiguity with respect to the crediting of an Hour Worked shall be resolved in favor of the Eligible Employee.  Furthermore, in crediting Hours Worked under this Section 2.20, the rules of paragraphs (b) and (c) of Department of Labor Regulation § 2530.200b-2 which the Plan, by this reference, specifically incorporates in full within this Section 2.20, shall be applied.

Solely for purposes of determining whether the Eligible Employee incurs a Break in Service under any provision of this Plan, the Plan Administrator shall credit Hours Worked during an Eligible Employee's unpaid absence period due to maternity or paternity leave if his or her absence is due to the Eligible Employee's pregnancy, the birth of the Eligible Employee's child, the placement with the Eligible Employee of an adopted child, or the care of the Eligible Employee's child immediately following the child's birth or placement.  The Plan Administrator shall credit Hours Worked under this paragraph on the basis of the number of Hours Worked the Employee would receive if he were paid during the absence period or, if the Plan Administrator cannot determine the number of Hours Worked the Eligible Employee would receive, on the basis of eight (8) hours per day during the absence period.  The Plan Administrator only shall credit the number of Hours Worked (up to 501 Hours Worked) necessary to prevent an Eligible Employee's Break in Service.  The Plan Administrator shall credit all Hours Worked described in this paragraph to the computation period in which the absence period begins or, if the Eligible Employee does not need these Hours Worked to prevent a Break in Service in the computation period in which is absence period begins, the Plan  Administrator shall credit these Hours Worked to the immediately following Computation Period.  The Plan Administrator shall apply this paragraph for absence periods which begin in Plan Years commencing after December 31, 1984.

(e)      Hours Worked shall also include hours during which a Participant would have worked but for one or more involuntary furlough(s), up to a maximum of sixty (60) working days or four-hundred fifty (450) hours in any Plan Year.  An involuntary furlough shall be defined as a period of time during which the Participant would have worked but for the temporary shutdown of operations mandated by the Company.

(f)       Notwithstanding any provision of this Plan to the contrary, contributions, benefits and service credit with respect to qualified military service will be provided in accordance with Section 414(u) of the Code.

    Section 2.21 - Normal Retirement Date.  The Normal Retirement Date of a Participant is the last day of the month in which he attains age 65.

    Section 2.22 - Normal Retirement Age.  A Participant's Normal Retirement Age is age 65, or five years after the Participant commenced participation in the Plan, whichever is later.

    Section 2.23 - PBGC.  Pension Benefit Guaranty Corporation, a body corporate within the Department of Labor established under the provisions of Title IV of ERISA.

    Section 2.24 - Participant.  A Participant is an Eligible Employee or former Eligible Employee who has satisfied the eligibility requirements of Article III and who is either accruing a benefit or is entitled to receive a benefit under the Plan.

    Section 2.25 - Plan.  The Plan is the Graphic Communications International Union, Twin Cities Local 6A - Buckbee-Mears Pension Plan as may be amended from time to time, this document comprising the Seventh Restatement of such Plan.

    Section 2.26 - Plan Administrator.  The Plan Administrator shall be appointed by the Trustees and serve until replaced by the Trustees or until said Plan Administrator resigns.

    Section 2.27 - Plan Anniversary Date.  The Plan Anniversary Date of this Plan is January 1.

    Section 2.28 - Plan Year.  The Plan Year is the 12-month period commencing each January 1.

    Section 2.29 - Re-Employment Commencement Date.  The date following a Break in Service when an Eligible Employee first works one hour for the Employer.

    Section 2.30 - Retirement Fund.  Retirement Fund  means the Restated Agreement and Declaration of Trust of  Graphic Communications International Union, Twin Cities Local 6A - Buckbee-Mears Retirement Fund, consisting of all contributions to the Retirement Fund received by the Trustees, together with all income, increments, earnings, and profits therefrom, and all other assets held by the Trustees for the uses, purposes, and trusts set forth in said Retirement Fund Trust Agreement.

    Section 2.31 - Termination of Employment.  Termination of Employment is the severance of an Eligible Employee's employment relationship with the Employer, the Company and ERISA Affiliates (as defined in Section 2.13).

    Section 2.32 - Trustees.  Trustees or Trustee means the Trustees or a Trustee of the Retirement Fund.

    Section 2.33 - Union.  Union means Graphic Communications International Union, Twin Cities Local 6A.

    Section 2.34- Vesting.  For purposes of this Plan, an Eligible Employee's Accrued Benefit shall be vested pursuant to the following schedule:

Years of Vesting Service                                 % Vested

0-4 Years of Service                                        0%

5   Years or More                                         100%
 

For Plan years prior to January 1, 1989, the following schedule applies:
 

Years of Vesting Service                                 % Vested

0-9 Years of Service                                         0%

10 Years or More                                          100%

ARTICLE III

EMPLOYEE PARTICIPATION

    Section 3.1 - Eligibility for Participation.  Each Eligible Employee shall become a Participant in the Plan as follows:

(a)      Any Eligible Employee included under the provisions of the Former Plan as of the Effective Date shall continue to participate in accordance with the provisions of this amended and restated Plan.

(b)      Any other Eligible Employee as of the Effective Date who has both attained age 21 and completed an Eligibility Computation Period ending prior to said date, during which he had not less than 1,000 Hours Worked, shall become a Participant on the Effective Date.

(c)      The participation of any Eligible Employee thereafter to become a Participant shall commence as of the earlier of January 1 or July 1 following the date he has both attained age 21 and completed an Eligibility Computation Period ending prior to said date of not less than 1,000 Hours Worked.

    After a Break in Service, the provisions of Section 3.3 and 3.4 shall be applicable.

    Section 3.2 - Transfer to Eligible Employee Status.  Transfer from an ineligible status to the status of an Eligible Employee will result in immediate participation if the Eligible Employee satisfies the requirements of Section 3.1; otherwise he will begin participation in The Plan as provided for in Section 3.1.

    Section 3.3 - Re-Employment after a Break in Service.  An Eligible Employee who has been re-employed after a Break in Service may resume participation in the Plan as soon as he has completed a 12-month period in which he has 900 Hours Worked.  He shall reenter the Plan retroactive to his Re-Employment Commencement Date.

    Such a Participant shall receive Accrual Service if he has 900 or more Hours Worked during the first Accrual Computation Period ending after his Re-Employment Commencement Date.  If he has less than 900 Hours Worked during this partial Computation Period but he has hours equal to at least 900 considering the fraction of the Computation Period worked, he will accumulate a fraction of a year of Accrual Service equal to the ratio of the Hours Worked during such partial Computation Period to 1,800 hours for a full accrual Computation Period.  For periods of re-employment prior to January 1, 1981, an Eligible Employee shall earn credit as described in the previous sentence with 975 hours substituted for 900 hours and 1,950 hours substituted for 1,800 hours.

    Section 3.4 - Preservation of Pre-Break Service.  In the event of re-employment after a Break in Service, service completed prior to the Break in Service for non-vested Participants will be disregarded for all purposes under the Plan unless the number of the Eligible Employee's consecutive Breaks in Service is less than:

(a)      The Eligible Employee's aggregate Years of Vesting Service (without regard to Vesting Service disregarded under Section 3.4), or

(b)      five (5) years, if greater than (a).

    In the event that a Participant terminates employment with the Employer for any reason and suffers consecutive Breaks in Service of five years or less and returns to employment with the Employer as an Eligible Employee, that Participant's Accrued Benefit under Section 2.3 of this Plan shall be calculated by multiplying all of that Participant's years of Accrual Service with the Employer times the Accrued Benefit rate in effect as of the date of that Participant's final termination of employment with the Employer.  In the event that a Participant terminates employment with the Employer for any reason, suffers consecutive Breaks in Service in excess of five years and subsequently returns to employment with the Employer as an Eligible Employee, the Participant's Accrued Benefit under Section 2.3 of the Plan shall be calculated by multiplying the applicable Accrued Benefit rate in effect at the time of the Participant's first Termination of Employment times the years of Accrual Service earned at that time and adding to that figure the amount determined by multiplying the years of Accrual Service earned after the Breaks in Service times the applicable Accrued Benefit rate in effect at the Participant's final Termination of Employment with the Employer.

ARTICLE IV

BENEFITS

    Section 4.1 - Normal Retirement Benefit Formula.  A Participant's pension benefit payable in the normal form shall be a benefit payable for his lifetime in a monthly amount equal to his Accrued Benefit.  The Termination of Employment of a Participant on or after his Normal Retirement Age shall be deemed to be a normal retirement.  Upon such retirement, he shall be entitled to a pension in the amount determined according to the first sentence of this Section 4.1 payable monthly for life, with the first payment to be made as of the first day of the month next following his Termination of Employment, if he is then living, and the last  payment as of the first day of the month in which his death occurs.

    Section 4.2 - Accrued Benefit.  The Accrued Benefit may be determined as of any point in time that the Participant is an Eligible Employee.  In no event will any Accrued Benefit determined after the Effective Date be less than the Accrued Benefit determined as of the preceding Plan Anniversary Date.

    Section 4.3 - Early Retirement Benefit.  The Termination of Employment of a Participant prior to his Normal Retirement Date shall be deemed to be an early retirement if he has then attained age 55 and completed at least 10 years of Vesting Service.  Upon such early retirement, he shall be entitled to a pension payable monthly for life, with the first payment to be made as of the first day of the month next following his Normal Retirement Date, if he  is then living, and the last payment as of the first day of the month in which his death occurs.  The amount of each monthly payment shall equal his Accrued Benefit.

    In lieu of such payment the Participant may elect to have benefits commence on the first of any month following his Termination of Employment and prior to his Normal Retirement Date.  The benefit payable from such earlier commencement date shall be the pension benefit payable in the normal form (as determined under Section 4.1)..

(a)      reduced by six and two-thirds (6-2/3%) percent reduction per year for the first five years of commencement immediately prior to age 65; and

(b)      reduced by three and one-third (3-1/3%) percent reduction per year for an additional five years.

    Section 4.3. A. - Special Early Retirement Benefit.  Effective January 1, 1997, any Participant who terminates employment with the Employer after he reaches age 55 on or after January 1, 1997 and has completed at least 25 years of Accrual Service as of the date of termination shall be eligible to commence a retirement benefit after he has attained age 62 without any reduction in the Accrued Benefit calculated under Section 2.3.

    Section 4.4 - Benefit Upon Other Termination of Employment.  If a Participant's Termination of Employment occurs prior to his Normal Retirement Age, and if at the time of his Termination of Employment he has completed at least 5 years of Vesting Service and has not attained age 55, he shall be entitled to a pension payable monthly for life, with the first payment to be made as of the first day of the month next following his Normal Retirement Date, if he is then living, and the last payment as of the first day of the month in which his death occurs.  The amount of each monthly payment shall equal his Accrued Benefit.

    Section 4.4.A. - Disability Benefit.  Effective January 1, 1998, any Participant with at least 10 years of Accrual Service who terminated employment after age 55 due to a total and permanent disability as determined by the Social Security Administration shall be eligible to retire as of the date of disability without any reduction in the Accrued Benefit calculated under Section 2.3.  Upon such disability retirement, he shall be entitled to a pension payable monthly for life, with the first payment to be made as of the first day of the month following his Termination of Employment and submission of his application for the pension benefit accompanied by evidence that he has been determined to be totally and permanently disabled by the Social Security Administration.  If the Participant is no longer totally and permanently disabled at any time prior to age 62, the disability pension shall be discontinued and the Participant shall be entitled to additional pension benefits only in accordance with the other provisions in the Plan.

    Section 4.5 - Early Commencement of Benefits.  A Participant who qualifies under Section 4.4 and has at least ten years of Vesting Service may elect a reduced monthly benefit which is in lieu of the aforesaid benefit, with the first payment to be made as of the first day of any month after his attainment of age 55 and prior to his Normal Retirement Date and the  last payment as of the first day of the month in which his death occurs.  The benefit payable from such earlier commencement date shall be the pension benefit payable in the normal form (as determined under Section 4.1):

(a)      reduced by six and two-thirds (6/2/3%) percent reduction per year for the five years immediately prior to age 65; and

(b)      reduced by three and one-third (3-1/3%) percent reduction per year for an additional five years.

    Section 4.6 - Minimum Benefit.  In no event will the benefit determined in Section 4.1, 4.2, 4.3 or 4.4 and payable from Normal Retirement Date be less than the Accrued Benefit under the Former Plan as of the Effective Date.

    Section 4.7 - Benefits that Matured Prior to the Effective Date.  Benefits, if any, payable on account of a Participant's Termination of Employment prior to the Effective Date shall be  determined and paid in accordance with the provisions of the Plan in effect as of the date of his Termination of Employment.

    Section 4.8 - Non-Duplication of Benefits.  In the event that a Participant terminates covered employment under the Collective Bargaining Agreement but continues in the employment of the Employer or the Company in a different position, the Participant shall not accrue any additional Accrual Service under this Plan unless the Participant later resumes covered employment under the Collective Bargaining Agreement.  In addition, the Accrued Benefit defined under Section 2.3 of the Plan shall be calculated for that Participant who terminated employment with the Employer as of the date the Participant ceased to be an Eligible Employee covered by the Collective Bargaining Agreement and not the date the Participant later terminates non-covered employment with the Employer or the Company.  In the event that the Participant is re-employed and is an Eligible Employee covered by the Collective Bargaining Agreement, and received Accrual Service after a one-year Break in Service, the Accrued Benefit calculated under Section 2.3 of the Plan shall be calculated based on the applicable Accrued Benefit at the time of the earlier termination times the years of Accrual Service at that time plus later years of Accrual Service times the applicable Accrued Benefit rate in effect under the Plan at the subsequent Termination of Employment.  In addition, notwithstanding any other provisions of the Plan, benefits otherwise payable to a Participant under Section 4.1, 4.3 or 4.4 shall be suspended during such period as he receives long or short term disability benefits provided by the Employer or the Company and during periods of re-employment with the Employer prior to the Participant's Normal Retirement Date.  Any benefits payable subsequent to Termination of Employment will be actuarially adjusted to reflect the payments already received.

    Section 4.9 - Optional Forms of Benefit Payments.  In lieu of the amount and form of pension payable under Section 4.1, 4.3 or 4.4, a Participant may, under such rules and regulations as the Trustees may prescribe which are in accord with the advice of the Actuary, and subject to the provisions of Section 4.10 and 4.16, elect to have a pension benefit payable in any of the following optional forms:

(a)      Ten (10) Year Certain and Life Benefit.  A reduced monthly benefit payable to the Participant for his or her life, with the provision that, if the Participant dies before having received 120 monthly payments, such reduced monthly payments will continue to the Participant's designated Beneficiary until the number of monthly payments made to the Participant and the Participant's designated Beneficiary total 120;

(b)      Joint and Fifty (50%) Percent Survivor Benefit.  A reduced monthly benefit payable to the Participant for his or her life, with the provision that, if the Participant is survived by his or her contingent annuitant, one-half of such reduced monthly benefit will be continued to the contingent annuitant for the duration of the contingent annuitant's life; and

(c)      Joint and One Hundred (100%) Percent Survivor Benefit.  A reduced monthly benefit payable to the Participant for his or her life, with the provision that, if the Participant is survived by his or her contingent annuitant, such reduced monthly benefit will be continued to the contingent annuitant for the duration of the contingent annuitant's life.

The amount of the benefit available under any of the options set forth in this Section shall be calculated by applying the reduction factors set forth in Appendix A to this Pension Plan.  Benefit payments under any option elected in accordance with the terms of this paragraph shall commence on the same date that benefit payments would otherwise commence under Section 4.1, 4.3, 4.4 or 4.5, whichever is applicable.  In conjunction with the Participant's election of an optional benefit under subsections (b) or (c), the Participant must designate, in form prescribed by the Trustees, a contingent annuitant to receive the survivor benefits thereunder; provided, that, if the designation is not made at that time, a designation may be made at a later date, but not after the commencement of benefit payments to the Participant.  Notwithstanding other provisions of this paragraph to the contrary, if a Participant dies before his or her payments have commenced, the Trustees shall not make payment to a Beneficiary who is not the Participant's spouse for a period which exceeds five (5) years from the date of the Participant's death.

    If a Participant remains in the employ of the Company after his Normal Retirement Date, and if his death occurs thereafter prior to his Termination of Employment, and if he elected an optional form of benefit payment under this Section which was not revoked prior to his death, the same benefit shall be provided his Beneficiary or joint or contingent annuitant under the option as though the Participant's Termination of Employment had occurred on his Normal Retirement Date and he had received monthly payments under the option for each month prior to his death.

    Section 4.10 - Qualified Joint and Survivor Annuity.  Unless a Participant elects otherwise, as hereinafter specified in Section 4.16, benefits shall be paid in the form of a Qualified Joint and Survivor Annuity with respect to any Participant who has a spouse and who -

(a)      begins to receive benefit payments under Section 4.1, 4.3, 4.4 or 4.5, or

(b)      dies on or after attaining Normal Retirement Age and prior to his or her Termination of Employment, or

(c)      ceases to be an Eligible Employee on or after the date he is entitled to receive benefits under Sections 4.1 or 4.4 and thereafter dies before beginning to receive such benefits.

A "Qualified Joint and Survivor Annuity" is an annuity for the life of the Participant with a survivor annuity for the life of his spouse which is 50% of the amount payable for the life of the Participant.  The amount of the benefit available under this Section shall be calculated by applying the reduction factors set forth in Appendix A to this Plan, under the Option "Joint and 50% Survivor."

    Section 4.11 - Pre-Retirement Spouse Annuity.

(a)      Eligibility. If a married Participant dies prior to commencement of payment of his Nonforfeitable Accrued Benefit, the Trustee will distribute to the Participant's surviving spouse a pre-retirement survivor annuity, unless the Participant and his spouse were not married throughout the one (1) year period ending on the date of his death.  This Section shall apply to a Participant who dies after August 22, 1984, and either (i) completes at least one (1) Hour Worked with the Employer after August 22, 1984, or (ii) separated from Service with at least ten (10) years of service and completed at least one (1) Hour Worked with the Employer in a Plan Year beginning after December 31, 1975.  If a Participant's death benefit is payable on or after the Effective Date and this Section does not apply to the Participant, the Plan Administrator shall make payment of the Participant's entire Nonforfeitable Accrued Benefit in accordance with Sections 4.10 and 4.15, subject to the requirements of subsection (c) hereof.

For a Participant dying after the earliest retirement age under the Plan, the pre-retirement spouse annuity shall equal the survivor annuity portion of the qualified joint and fifty (50%) percent survivor annuity the Trustees would have paid under Section 4.10 if the Participant had commenced receiving the qualified joint and survivor annuity the day before his death.  For a Participant dying on or before the earliest retirement age under the Plan, the pre-retirement survivor annuity shall equal the survivor annuity portion of the qualified joint and fifty (50%) percent survivor annuity the Trustees would have paid under Section 4.10 if the Participant had separated from service on the date of his death, had commenced receiving the qualified joint and survivor annuity at the earliest retirement age under the Plan, and had died the day after attaining the earliest retirement age under the Plan.  The "earliest retirement age under the Plan" is the earliest date on which the Plan permits the Participant to elect to receive retirement benefits.  Notwithstanding the immediately preceding provisions of this paragraph, if the actuarial equivalent of the pre-retirement spouse annuity calculated under the formula set forth in Section 2.4 is not greater than $5,000, (using the GATT interest rates in effect as of retirement) the Trustees will pay the Participant's surviving spouse the actuarial equivalent in a single lump sum payment as a complete settlement of all obligations under this Plan.

The Trustees shall commence payment of the pre-retirement spouse annuity on or before the later of one (1) year after the Participant's death or the date the Participant would have attained age seventy and one-half (70-1/2) unless the Participant's surviving spouse files an election to commence payment at some earlier date.

(b)      No Reduction of Pension Benefits.  A Participant's pension benefits shall not be reduced as a result of the pre-retirement spouse annuity coverage required under Section 4.11(a) or the survivor's annuity coverage under Section 4.11(c).  The Plan shall bear the cost of providing the pre-retirement spouse annuity or the survivor's annuity benefits.

(c)      Payment of Certain Survivor Benefits After the 1/1/2001.  If a married Participant who is not subject to Section 4.11(a) but who has received credit for at least one (1) Hour Worked after September 1, 1974, has a death benefit payable on or after the Effective Date, the Participant's surviving spouse shall receive a spouse's pre-retirement annuity if:

(1)      the Participant had made a spouse's annuity election at any time during the spouse annuity election period; and

(2)      dies while employed as an Eligible Employee of the Employer on or after attaining qualified early retirement age.  The spouse annuity election period shall begin on the ninetieth (90^th) day before the Participant attains the qualified early retirement age and shall end on the date of the Participant's Termination of Employment.  A Participant's "qualified early retirement age" is the later of the first day of the one hundred twentieth (120^th) month beginning before the Participant attains Normal Retirement Age, or the date on which the Participant began participation under this Plan.

Furthermore, if a married Participant who is not subject to Section 4.11(a) but who has received credit for at least one (1) Hour Worked after September 1, 1974, has a death or termination benefit payable on or after the Effective Date, the Participant's surviving spouse shall receive a spouse's annuity if:

(3)      the Participant dies on or after Normal Retirement Age while employed  by the Employer, or has a Termination of Employment on or after attaining his qualified early retirement age but dies before the Trustee commences payment of his pension; and

(4)      the Participant (and, for elections made after December 31, 1984, the Participant's spouse) has not waived the qualified joint and survivor annuity during the ERISA election period.  The ERISA election period begins on the later of (i) the date one hundred and eighty (180) days prior to the Participant's attaining qualified early retirement age, or (ii) the date the Participant commenced participation in the Plan, and ends on the Participant's annuity starting date under Section 4.10.

The spouse's pre-retirement annuity shall equal the survivor annuity portion of the qualified joint and survivor annuity payable under Section 4.10 determined as if the Participant had retired the day before his death and commenced receiving the qualified joint and survivor annuity.

    Section 4.12 - Payment of Small Amounts.

(a)      If the actuarially equivalent present value of a Participant's vested Accrued Benefit does not exceed Five Thousand Dollars ($5,000) and did not exceed such amount at the time of any previous distribution of such benefit, the benefit shall be paid to the Participant or to his or her surviving spouse following the Participant's death in a single lump sum payment no later than sixty (60) days after the close of the Plan Year following the Plan Year in which the Participant terminates employment or dies, whichever occurs first.  Actuarially equivalent lump sum values shall be calculated on the basis of (1) the mortality table based on the prevailing commissioners' standard table (described in section 807(d)(5)(A) of the Code, which is the mortality table prescribed in Revenue Ruling 95-6 for distributions with an annuity starting date before December 31, 2002 and the mortality table prescribed in Revenue Ruling 2001-62 for distributions with an annuity starting date on or after December 31, 2002)) used to determine reserves for group annuity contracts issued on the date as of which the lump sum is being determined (without regard to any other subparagraph of section 807(d)(5)), as prescribed by the Commissioner of Internal Revenue in revenue rulings, notices or other guidance and (2) for any lump sum payment made during a calendar year, an interest rate equal to the annual interest rate on 30-year Treasury securities for the November immediately preceding such calendar year as such rate is prescribed by the Commissioner of Internal Revenue in revenue rulings, notices or other guidance.

(b)      In the case of any distribution pursuant to this section that constitutes an "eligible rollover distribution," within the meaning of section 402(c)(4) of the Internal Revenue Code, the Trustees will, if so instructed by the distributee in accordance with uniform rules, make the distribution to an "eligible retirement plan" within the meaning of section 402(c)(8) of the Internal Revenue Code.  The foregoing provision will not apply if (i) the aggregate taxable distribution to be made to the distributee from this Plan during the distributee's taxable year is less than Two Hundred Dollars ($200) or (Ii) if less than the entire taxable amount of the distribution is to be distributed to an eligible retirement plan and the amount to be distributed to the eligible retirement plan is less than five Hundred Dollars ($500).

    Section 4.13 - No Other Benefits.  In the event the Trustees distribute any part or all of  a Participant's Accrued Benefit to him and the Participant later resumes active employment with the Employer, the Trustee shall compute the Participant's Accrued Benefit by taking into account all of the Participant's Years of Participation.  However, the Trustee shall offset the Participant's Accrued Benefit so computed by the Participant's Accrued Benefit attributable to any distribution the Trustee has made to the Participant.

    Section 4.14 - Maximum Benefits.  The maximum benefit, when expressed as a monthly pension, shall not exceed $7,500.00, subject to the following:

(a)      The maximum shall apply to the single-life pension computed under Article IV.

(b)      If benefits begin prior to age 65, the maximum will apply to such reduced pension; provided that, if benefits begin prior to age 55, the maximum will apply to a pension beginning at age 55, which is the Actuarial Equivalent of such benefit.

(c)      If the Participant has fewer than ten years of credited service at retirement, the applicable maximum shall be multiplied by a fraction, of which the numerator is his Accrual Service and the denominator is 10.

(d)      The maximum amount of $7,500.00 per month shall be increased as permitted in Section 415(b) of the Internal Revenue Code.

    Notwithstanding the foregoing with respect to a Participant included under the prior provisions of the Plan, the maximum computed under this subsection shall not be less than the Pension payable under the Plan provisions in effect as of December 31, 1982 based upon his rate of compensation under the Plan in effect as of such date and on Accrual Service to the date of his Termination of Employment.

    Section 4.15 - Death Benefit.  Upon the death of a Participant who has ten (10) or more years of Vesting Service and who is an Eligible Employee whose employment with the Employer has not terminated or is a former Eligible Employee currently on leave of absence or laid off and maintaining his name on the Employer's seniority or recall list, the sum of Five Thousand and no/100s ($5,000.00) Dollars shall be paid in a single lump sum payment to the Participant's Beneficiary designated in accordance with Section 2.6 of this Plan.  However, if such Participant is married at the time of his death and has been married for the one year period immediately preceding his death, any benefits payable as a result of Participant's death shall be paid to his spouse unless his spouse has consented to the designation of another Beneficiary.  Such consent shall be notarized and submitted to the Plan Administrator.

    Section 4.16 - Manner of Election - Revocation for Joint and Survivor Annuity - Normal Retirement Age.  A Participant may make an election not to have his Accrued Benefit paid in the form of a Qualified Joint and Survivor Annuity under Section 4.10 at any time during the election period.  The election period shall begin on the date the Plan Administrator furnishes to the Participant the information required under the third paragraph of this Section 4.16 and shall end on the ninetieth (90^th) day before the Trustee commences to pay the Participant his Accrued Benefit.  If, within 60 days from the date the information was furnished as required by the preceding sentence, a Participant makes a request for additional information, the election period shall extend, to the extent necessary, to include the ninety (90) calendar days immediately following the date the Plan Administrator either mails or personally delivers the requested additional information to the Participant.  A Participant may revoke an election made under this Section 4.16 at any time during the election period, and thereafter may make a new election at any time within the election period.  For waiver elections made after December 31, 1984, a Participant's spouse (to whom the survivor annuity is payable under the Qualified Joint and Survivor Annuity) must consent in writing to the waiver election, acknowledging the effect of the election and such consent must be witnessed by a Notary Public.

    The Plan Administrator may accept as valid a waiver election which does not satisfy the spousal consent requirement described above if the Plan Administrator establishes the Participant does not have a spouse, the Plan Administrator is not able to locate the Participant's spouse, or other circumstances exist under which the Secretary of Treasury will excuse the consent requirement.

    The Plan Administrator shall furnish to each Participant and spouse eligible to receive a normal retirement pension a written general description of the Qualified Joint and Survivor Annuity, the Participant's right to make, and the effect of an election to waive the Joint and Survivor Annuity form of benefit, the rights of the Participant's spouse regarding the waiver election.  The written description shall include the financial effect upon the Participant's normal retirement pension (in terms of dollars per pension payment) of making an election not to receive payment in the form of a Qualified Joint and Survivor Annuity.  The Plan Administrator either shall mail or personally deliver the written description at such time to ensure its receipt by the Participant on or about the earlier of:

(a)      The date nine (9) months prior to the Participant's attaining Normal Retirement Age; or

(b)      The later of the date one hundred eighty (180) days prior to the Participant's satisfying the requirements for an early commencement of benefits under Section 4.5 or the date the Participant commences participation in the Plan.

    The Plan Administrator shall provide and prescribe the form for a Participant's written election and the spouse's consent under this Section 4.16.  The election form shall state clearly that the Participant is electing to receive all of his Accrued Benefit under the Plan in a form other than a Qualified Joint and Survivor Annuity.  An election, or revocation of an election, is effective as of the date filed with the Plan Administrator.

ARTICLE V

PLAN FINANCING

    Section 5.1 - Contributions. No contributions shall be required or permitted under the Plan from any Participant.  The Company and any participating Employer shall make contributions in such amounts and at such times as determined by the Company in accordance with a funding method and policy to be established by said Company which will be consistent with the minimum funding standards of ERISA.  Forfeitures arising under this Plan, shall be applied to reduce the cost of the Plan, not to increase the benefits otherwise payable to Participants.

    Section 5.2 - Retirement Fund.  All contributions made by the Company or a participating Employer under this Plan shall be paid to the Investment Manager, or if there is no Investment Manager, then to the corporate agent, or if there is no corporate agent, then to the Trustees and deposited in the Retirement Fund.  All assets of the Retirement Fund, including investment income, shall be retained for the exclusive benefit of Participants and their beneficiaries, shall be used to pay benefits to such persons or to pay administrative expenses to the extent not paid by the Company, and shall not revert or inure to the benefit of the Company.

    Notwithstanding anything herein to the contrary, upon the request of the Company or a participating Employer, a contribution which was conditioned upon qualification of the Plan or any amendment thereof under Section 401(a) of the Internal Revenue Code shall be returned to the Company or participating Employer within one year after the denial of the qualification.

ARTICLE VI

ACTUARY

    Section 6.1 - Appointment and Duties.  The Company shall appoint an individual or a corporation or a firm with at least one individual who is qualified or experienced in
performing actuarial services in the valuation, funding and administration of retirement, pension, or annuity plans and who is an enrolled Actuary as provided under ERISA to serve as the Actuary to perform the services set forth herein and to perform such additional services  with respect thereto as may be conferred by the Company and as are consistent with the provisions of the Plan.  All determinations of Actuarial Equivalent values permitted or required to be made under the Plan or otherwise shall be made only in accordance with the advice of the Actuary, and the rules, regulations, and tables relating thereto shall become effective only with the approval of the Actuary.

    Section 6.2 - Successors.  The Company shall have the right at any time to remove the Actuary then acting, to appoint a successor or successors, and to fill vacancies in the office of the Actuary.

ARTICLE VII

ADMINISTRATION

    Section 7.1 - Allocation of Responsibility Among Fiduciaries for Plan and Retirement Fund Administration.  The Fiduciaries shall have only those specified powers, duties, responsibilities and obligations as are specifically given to them under this Plan or the Retirement Fund.  In general, the Company and any participating Employers shall have the sole responsibility for making the contributions necessary to provide benefits under the Plan as specified in Article VII.

    The Trustees shall have the sole responsibility for the administration of the Plan and Retirement Fund and the management of the assets held under the Retirement Fund, all as specifically provided in the Retirement Fund.  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 Retirement Fund, 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 Retirement Fund, and is not required under this Plan or the Retirement Fund to inquire into the propriety of any such direction, information or action.  It is intended under this Plan and the Retirement Fund  that each Fiduciary shall be responsible for the proper exercise of its own powers, duties, responsibilities and obligations under this Plan and the Retirement Fund and shall not be responsible for any act or failure to act of another Fiduciary.  No Fiduciary guarantees the Retirement Fund in any manner against investment loss or depreciation in asset value.

    Section 7.2 - Facility of Payment.  Whenever, in the Trustees' opinion, a person entitled to receive any payment of a benefit or installment thereof hereunder is under a legal disability or is incapacitated in any way so as to be unable to manage his financial affairs, the Trustees may direct payments to such person or to his legal representative or to a relative or friend of such person for his benefit, or the Trustees may apply the payment for the benefit of such person in such manner as the Trustees consider advisable.  Any payment of a benefit or installment thereof in accordance with the provisions of this Section shall be a complete discharge of any liability for the making of such payment under the provisions of the Plan.

    Section 7.3 - Discretionary Authority.  The Plan Administrator appointed by the Trustees pursuant to this document shall have the discretion and authority to make all decisions necessary and useful to interpret and administer this Plan.  Decisions of the Plan Administrator shall be final and binding.  The Plan Administrator shall have the power to delegate any and all responsibility for administering the Plan.  However, such delegation shall not relieve the Plan Administrators of its responsibilities under this Plan.

ARTICLE VIII

MISCELLANEOUS

    Section 8.1 - Non-Guarantee of Employment.  Nothing contained in this Plan shall be construed as a contract of employment between the Company or the Employer and any Eligible Employee, or as a right of any Eligible Employee to be continued in the employment of the Company or the Employer, or as a limitation of the right of the Company of the Employer to discharge any of its employees, with or without cause.

    Section 8.2 - Rights to Retirement Fund Assets.  No Eligible Employee shall have any right to, or interest in, any assets of the Retirement Fund upon Termination of Employment or otherwise, except as provided from time to time under this Plan, and then only to the extent of the benefits payable under the Plan to such employee out of the assets of the Retirement Fund.  In case of termination or partial termination of this Plan, the rights of all affected Participants to their Accrued Benefit to the extent funded as of the date of such termination or partial termination, shall be nonforfeitable.  Except as otherwise may be provided under Title IV of ERISA, all payments of benefits as provided for in this Plan shall be made solely out of the assets of the Retirement Fund and none of the Fiduciaries shall be liable therefor in any manner.

    Section 8.3 - Non-Alienation of Benefits.  Subject to Section 8.4, benefits payable under this Plan shall not be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, charge, garnishment, execution or levy of any kind, either voluntary or involuntary, including any such liability which is for alimony or other payments for the support of a spouse or former spouse or for any other relative of the Participant, prior to actually being received by the person entitled to the benefit under the terms of the Plan; and any attempt to anticipate, alienate, sell, transfer, assign, pledge, encumber, charge or otherwise dispose of any right to benefits payable hereunder, shall be void.  The Retirement Fund shall not in any manner be liable for, or subject to, the debts, contracts, liabilities, engagements or torts of any person entitled to benefits hereunder.

    Section 8.4 - Distributions Under Domestic Relations Orders.  Nothing contained in this Plan shall prevent the Trustees and the Plan Administrator from complying with the provisions of a qualified domestic relations order (as defined in Code §414(p)).

    The Plan Administrator shall establish reasonable procedures to determine the qualified status of a domestic relations order.  Upon receiving a domestic relations order, the Plan Administrator promptly shall notify the Participant and any alternate payee named in the order, in writing, of the receipt of the order and the Plan's procedures for determining the qualified status of the order.  Within a reasonable period of time after receiving the domestic relations order, the Plan Administrator shall determine the qualified status of the order and shall notify the Participant and each alternate payee, in writing, of its determination.  The Plan Administrator shall provide notice under this paragraph by mailing to the individual's address specified in the domestic relations order, or in a manner consistent with Department of Labor regulations.  The Plan Administrator may treat as qualified any domestic relations order entered prior to January 1, 1985, irrespective of whether it satisfies all the requirements described in Code §414(p).

    If any portion of the Participant's nonforfeitable Accrued Benefit is payable during the period the Plan Administrator is making its determination of the qualified status of the domestic relations order, the Trustees shall segregate the amounts payable in a separate account and invest the segregated account solely in fixed income investments.  If the Plan Administrator determines the order is a qualified domestic relations order within eighteen (18) months of receiving the order, the Trustees shall distribute the segregated account in accordance with the order.  If the Plan Administrator does not make its determination of the qualified status of the order within eighteen (18) months after receiving the order, the Trustees shall distribute the segregated account in the manner the Plan would distribute if the order did not exist and shall apply the order prospectively if the Plan Administrator later determines the order is a qualified domestic relations order.

    The Trustees shall make any payments or distributions required under this Section 8.4 by separate benefit checks or other separate distribution to the alternate payee(s).

ARTICLE IX

AMENDMENTS

    Section 9.1 - Amendment.  The Trustees may amend or modify this Plan at any time provided no amendment shall be adopted which alters the basic purpose of this Plan or the Retirement Fund; conflicts with the terms of any Collective Bargaining Agreement or with any applicable law; causes the use or diversion of any part of the Retirement Fund for purposes other than those authorized herein; increases the burdens or obligations of the Company or causes a reversion of any of the assets of the Retirement Fund to the Company or to the Union.  Furthermore, the Trustees and Plan Administrator shall neither enact nor apply any amendment to the Plan to reduce a Participant's Accrued Benefit immediately before the effective date of the amendment, except to the extent permitted under Code §412(c)(8).  An amendment adopted after July 30, 1984, decreases a Participant's Accrued Benefit determined immediately prior to the adoption date if the amendment has the effect of either (1) eliminating or reducing an early retirement benefit or a retirement-type subsidy (as defined in Treasury regulations), or (2) except as provided by Treasury regulations, eliminating an optional form of benefit.  The Plan Administrator shall disregard an amendment described in the immediately preceding sentence to the extent application of the amendment would decrease the Participant's Accrued Benefit determined immediately prior to the adoption date of the amendment.

ARTICLE X

SUCCESSOR COMPANY AND MERGER OR CONSOLIDATION OF PLANS

    Section 10.1 - Successor Company.  In the event of the dissolution, merger, consolidation or reorganization of the Company, provision may be made by which the Plan and Retirement Fund will be continued by the successor; and, in that event, such successor shall be substituted for the Company under the Plan.  The substitution of the successor shall constitute an assumption of Plan Liabilities by the successor and the successor shall have all the powers, duties, and responsibilities of the Company under the Plan.

    Section 10.2 - Plan Assets.  In the event of any merger or consolidation of the Plan with, or transfer in whole or in part of the assets and liabilities of the Retirement Fund to another Trust Fund held under, any other plan of deferred compensation maintained or to be established for the benefit of all or some of the Participants of this Plan, the assets of the Retirement Fund applicable to such Participants shall be transferred to the other Retirement Fund only if:

(a)      each Participant would (if either this Plan or the other plan then terminated) 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 before the merger, consolidation or transfer (if this Plan had then terminated);

(b)      resolutions of the Board of Directors of the Company under this Plan, and of any new or successor company of the affected Participants, shall authorize such transfer of assets; and, in the case of the new or successor company of the affected Participants, its resolutions shall include an assumption of liabilities with respect to such Participants' inclusion in the new company's plan; and

(c)      such other plan and trust are qualified under Sections 401(a) and 501(a) of the Internal Revenue Code.

ARTICLE XI

TOP HEAVY PROVISIONS

    Section 11.1 - Top Heavy Plan Requirements.  With respect to any portion of this Plan which covers Participants who are not covered by the Collective Bargaining Agreement ("Non-Bargaining Unit Participants"), for any Top Heavy Plan Year, the Plan shall provide the special vesting requirements of Code Section 416(b) pursuant to Section 11.3 of the Plan and the special minimum benefit requirements of Code Section 416(c) pursuant to Section 11.4 of the Plan.

    Section 11.2 - Determination of Top Heavy Status.

(a)      The portion of this Plan benefitting the Non-Bargaining Unit Participants shall be a Top Heavy Plan for any Plan Year commencing after December 31, 1982 in which, as of the Determination Date, (1) the Present Value of Accrued Benefits of Key Employees and (2) the sum of the Aggregate Accounts of Key Employees under this Plan and all plans of an Aggregation Group, exceeds sixty percent (60%) of the Present Value of Accrued Benefits and the Aggregate Accounts of all Key and Non-Key Employees under this Plan and all plans of an Aggregation Group.

    If any Participant is a Non-Key Employee for any Plan Year, but such Participant was a Key Employee for any prior Plan Year, such Participant's Present Value of Accrued Benefit and/or Aggregate Account balance shall not be taken into account for purposes of determining whether this Plan is a Top Heavy or Super Top Heavy Plan (or whether any Aggregation Group which includes this Plan is a Top  Heavy Group).  In addition, for Plan Years beginning after December 31, 1984, if a Participant or Former Participant has not performed any services for any Employer maintaining the Plan at any time during the five year period ending on the Determination Date, any accrued benefit for such Participant or Former Participant shall not be taken into account for the purposes of determining whether this Plan is a Top Heavy or Super Top Heavy Plan.

(b)      This Plan shall be a Super Top Heavy Plan for any Plan Year commencing after December 31, 1983 in which, as of the Determination Date, (1) the Present Value of Accrued Benefits of Key Employees and (2) the sum of the Aggregate Accounts of Key Employees under this Plan and all plans of an Aggregation Group, exceeds ninety percent (90%) of the Present value of Accrued Benefits and the Aggregate Accounts of all Key and Non-Key Employees under this Plan and all plans of an Aggregation Group.

(c)      Aggregate Account: A Participant's Aggregate Account as of the Determination Date shall be determined under applicable provisions of the defined contribution plan used in determining Top Heavy Plan status.

(d)      "Aggregation Group" means either a Required Aggregation Group or a Permissive Aggregation Group as hereinafter determined.

(1)      Required Aggregation Group: In determining a Required Aggregation Group hereunder, each plan of the Employer in which a Key Employee is a participant in the Plan Year containing the Determination Date or any of the four preceding Plan years, and each other plan of the Employer which enables any plan in which a Key Employee participates to meet the requirements of Code Sections 401(a)(4) or 410, will be required to be aggregated.  Such group shall be known as a Required Aggregation Group.

In the case of a Required Aggregation Group, each plan in the group will be considered a Top Heavy Plan if the Required Aggregation Group is a Top Heavy Group.  No plan in the Required Aggregation Group will be considered a Top Heavy Plan if the Required Aggregation Group is not a Top Heavy Group.

(2)      Permissive Aggregation Group: The Employer may also include any other plan not required to be included in the Required Aggregation Group, provided the resulting group, taken as a whole, would continue to satisfy the provisions of Code Sections 401(a)(4) and 410.  Such group shall be known as a Permissive Aggregation Group.

In the case of a Permissive Aggregation Group, only a plan that is part of the Required Aggregation Group will be considered a Top Heavy Plan if the Permissive Aggregation Group is a Top Heavy Group.  No plan in the Permissive Aggregation Group will be considered a Top Heavy Plan if the Permissive Aggregation Group is not a Top Heavy Group.

(3)      Only those plans of the Employer in which the Determination Dates fall within the same calendar year shall be aggregated in order to determine whether such plans are Top Heavy Plans.

(4)      An Aggregation Group shall include any terminated plan of the Employer if it was maintained within the last five (5) years ending on the Determination Date.

(e)      "Determination Date" means (a) the last day of the preceding Plan Year, or (b) in the case of the first Plan Year, the last day of such Plan Year.

(f)       "Present Value of Accrued Benefit:" In the case of a defined benefit plan, a Participant's Present Value of Accrued Benefit shall be determined:

(1)      In the case of a Participant other than a Key Employee, using the single accrual method used for all plans of the Employer and Affiliated Employers, or if no such single method exists, using a method which results in benefits accruing not more rapidly than the slowest accrual rate permitted under Code Section 411(b)(1)(C).

(2)      As of the most recent "accrual valuation date", which is the most recent valuation date within a twelve (12) month period ending on the Determination Date.

(3)      For the first Plan Year, as if (a) the Participant terminated service as of the Determination Date; or (b) the Participant terminated service as of the actuarial valuation date, but taking into account the estimated Accrued Benefits as of the Determination Date.

(4)      For the second Plan Year, the Accrued Benefit taken into account for a current participant must not be less than the Accrued Benefit taken into account for the first Plan Year unless the difference is attributable to using an estimate of the Accrued Benefit as of the Determination Date for the first Plan year and using the actual Accrued Benefit for the second Plan Year.

(5)      For any other Plan Year, as if the Participant terminated service as of the actuarial valuation date.

(6)      The actuarial valuation date must be the same date used for computing the defined benefit plan minimum funding costs, regardless of whether a valuation is performed that Plan Year.

(g)      The calculation of a Participant's Present Value of Accrued Benefit as of a Determination Date shall be the sum of:

(1)      The Present Value of Accrued Benefit using the actuarial assumptions of Section 2.4, which assumptions shall be identical for all defined benefit plans being tested for Top Heavy Plan status.

(2)      Any Plan distributions made within the Plan Year that includes the Determination Date or within the four (4) preceding Plan Years.  However, in the case of distributions made after the valuation date and prior to the Determination Date, such distributions are not included as distributions for top heavy purposes to the extent that such distributions are already included in the Participant's Present Value of Accrued Benefit as of the valuation date.  Notwithstanding anything herein to the contrary, all distributions, including distributions made prior to January 1, 1984, and distributions under a terminated plan which if it had not been terminated would have been required to be included in an Aggregation Group, will be counted.  Further, benefits paid on account of death, to the extent such benefits do not exceed the Present Value of Accrued Benefits existing immediately prior to death, shall be treated as distributions for the purposes of this paragraph.

(3)      Any Employee contributions, whether voluntary or mandatory.  However, amounts attributable to tax deductible Qualified Voluntary Employee Contributions shall not be considered to be a part of the Participant's Present Value of Accrued Benefit.

(4)      With respect to unrelated rollovers and plan-to-plan transfers (ones which are both initiated by the Employee and made from a plan maintained by one employer to a plan maintained by another employer), if this Plan provides the rollovers or plan-to-plan transfers, it shall always consider such rollovers or plan-to-plan transfers as a distribution for the purposes of this Section.  If this Plan is the plan accepting such rollovers or plan-to-plan transfers, it shall not consider such rollovers or plan-to-plan transfers accepted after December 31, 1983, as part of the Participant's Present Value of Accrued Benefit.  However, rollovers or plan-to-plan transfers accepted prior to January 1, 1984, shall be considered as part of the Participant's Present Value of Accrued Benefit.

(5)      With respect to related rollovers and plan-to-plan transfers (ones either not initiated by the Employee or made to a plan maintained by the same employer), if this Plan provides the rollovers or plan-to-plan transfers, it shall not be counted as a distribution for purposes of this Section.  If this Plan is the plan accepting such rollovers or plan-to-plan transfers, it shall consider such rollovers or plan-to-plan transfers as part of the Participant's Present Value of Accrued Benefit, irrespective of the date on which such rollovers or plan-to-plan transfers are accepted.

(6)      For the purposes of determining whether two employers are to be treated as the same employer in (4) and (5) above, all employers aggregated under Code Section 414(b), (c), (m) or (o) are treated as the same employer.

(h)      "Top Heavy Group" means an Aggregation Group in which, as of the Determination Date, the sum of:

(1)      The Present Value of Accrued Benefits of Key Employees under all defined benefit plans included in the group, and

(2)      The Aggregate Accounts of Key Employees under all defined contribution plans included in the group, exceeds sixty percent (60%) of a similar sum determined for all Participants.

(i)       "Aggregate Account" means, with respect to each Participant, the value of all accounts maintained on behalf of a Participant, whether attributable to Employer or Employee contributions, used to determine Top Heavy Plan status under the provisions of a defined benefit contribution plan included in any Aggregation Group (as defined in this Plan).

(j)       "Key Employee" means an Employee as defined in Code Section 416(i) and the Regulations thereunder.  Generally, any Employee or former Employee (as well as each of his Beneficiaries) is considered a Key Employee if he, at any time during the Plan Year that contains the "Determination Date" or any of the preceding four (4) Plan Years, has been included in one of the following categories:

(1)      An officer of the Employer (as that term is defined within the meaning of the Regulations under Code Section 416) having annual "415 Compensation" greater than 50 percent of the amount in effect under Code Section 415(b)(1)(A) for any such Plan Year.

(2)      One of the ten employees having annual "415 Compensation" from the Employer for a Plan Year greater than the dollar limitation in effect under Code Section 415(c)(1)(A) for the calendar year in which such Plan Year ends and owning (or considered as owning within the meaning of Code Section 318) both more than one-half percent interest and the largest interests in the Employer.

(3)      A "five percent owner" of the Employer.  "Five percent owner" means any person who owns (or is considered as owning within the meaning of Code Section 318) more than five percent (5%) of the outstanding stock of the Employer or stock possessing more than five percent (5%) of the total combined voting power of all stock of the Employer or, in the case of any unincorporated business, any person who owns more than five percent (5%) of the capital or profits interest in the Employer.  In determining percentage ownership hereunder, employers that would otherwise be aggregated under Code Sections 414(b), (c), (m) and (o) shall be treated as separate employers.

(4)      A "one percent owner" of the Employer having an annual "415 Compensation" from the Employer of more than $150,000.  "One percent owner" means any person who owns (or is considered as owning within the meaning of Code Section 318) more than one percent (1%) of the outstanding stock of the Employer or stock possessing more than one percent (1%) of the total combined voting power of all stock of the Employer or, in the case of an unincorporated business, any person who owns more than one percent (1%) of the capital or profits interest in the Employer.  In determining percentage ownership hereunder, employers that would otherwise be aggregated under Code Sections 414(b), (c), (m) and (o) shall be treated as separate employers.  However, in determining whether an individual has "415 Compensation" of more than $150,000, "415 Compensation" from each employer required to be aggregated under Code Sections 414(b), (c), (m) and (o) shall be taken into account.

For purposes of this Section, the determination of "415 Compensation" shall be made by including amounts that would otherwise be excluded from a Participant's gross income by reason of the application of Code Sections 125, 402(a)(8), 402(h)(1)(B) and, in the case of Employer contributions made pursuant to a salary reduction agreement, by including amounts that would otherwise be excluded from a Participant's gross income by reason of the application of Code Section 403(b).

(k)      "Non-Key Employee" means any Employee or former Employee (and his Beneficiaries) who is not a Key Employee.

(l)       "Super Top Heavy Plan" means a plan described in Section 11.2.

(m)     "Top Heavy Plan" means a plan described in Section 11.2.

(n)      "Top Heavy Plan Year" means a Plan Year commencing after December 31, 1983 during which a portion of the Plan is a Top Heavy Plan.

    Section 11.3 - Vesting if a Portion of the Plan Becomes Top Heavy.

    Notwithstanding the vesting otherwise provided for in the Plan for any Top Heavy Plan Year, the Vested portion of the Accrued Benefit of any Non-Bargaining Unit Participant who has an Hour of Service after the Plan becomes top heavy shall be a percentage of such Participant's number of years of Service according to the following schedule:

Vesting Schedule

Years of Service                    Percentage

  0-2                                         0%

      3                                     100%

    If in any subsequent Plan Year, the portion of the Plan benefiting Non-Bargaining Unit Participants ceases to be a Top Heavy Plan, the Administrator shall revert to the vesting schedule in effect before this Plan became a Top Heavy Plan.  Any such reversion shall be treated as a Plan amendment pursuant to the terms of the Plan.

    Section 11.4 - Minimum Benefit Requirement If a Portion of the Plan Becomes Top Heavy.

(a)      The minimum Accrued Benefit derived from Employer contributions to be provided under this Section for each Non-Key Employee who is a Non-Bargaining Unit Participant during a Top Heavy Plan Year shall equal the product of (1) one-twelfth (1/12th) of "415 Compensation" averaged over the five (5) consecutive "limitation years" (or actual number of "limitation years", if less) which produce the highest average and (2) the lesser of (i) two percent (2%) multiplied by Plan Years of Service or (ii) twenty percent (20%).

(b)      For purposes of providing the minimum benefit under Code Section 416, a Non-Key Employee who is not a Non-Bargaining Unit Participant solely because (1) his Compensation is below a stated amount or (2) he declined to make mandatory contributions to the plan will be considered to be a Participant.  Furthermore, such minimum benefit shall be provided regardless of whether such Non-Key Employee is employed on a specified date.

(c)      For purposes of this Section, Plan years of Service for any Plan Year beginning before January 1, 1984, or for any Plan Year during which the Plan was not a Top Heavy Plan shall be disregarded.

(d)      For purposes of this Section, "415 Compensation" for any "limitation year" ending in a Plan Year which began prior to January 1,1984, subsequent to the last "limitation year" during which the Plan is a Top Heavy Plan, or in which the Participant failed to complete a Plan Year of Service, shall be disregarded.

(e)      For the purposes of this Section, "415 Compensation" shall be limited to $200,000 (unless adjusted in such manner as permitted under Code Section 415(d)).  However, for Plan Years beginning prior to January 1, 1989, the $200,000 limit shall apply only for Top Heavy Plan Years and shall not be adjusted.

(f)       If the Plan provides for the Normal Retirement Benefit to be paid in a form other than a single life annuity, the Accrued Benefit under this Section shall be the Actuarial Equivalent of the minimum Accrued Benefit under (a) above pursuant to Section 2.3.

(g)      If payment of the minimum Accrued Benefit commences at a date other than Normal Retirement Date, the minimum Accrued Benefit shall be the Actuarial  Equivalent of the minimum Accrued Benefit commencing at Normal Retirement Date pursuant to Section 2.3.

(h)      To the extent required to be nonforfeitable under this Plan, the minimum Accrued Benefit under this Section may not be forfeited under Code Section 411(a)(3)(B) or Code Section 411(a)(3)(D).

ARTICLE XII

RESTRICTIONS ON BENEFITS PAYABLE TO HIGHLY

COMPENSATED PARTICIPANTS

    Section 12.1 - IRS Limitations.  This Article sets forth limitations required by the Internal Revenue Service on the pension benefits payable to certain Participants.  It shall apply to a Participant only if his anticipated annual pension exceeds $1,500.00 and the Participant was among the 25 highest paid employees of the Company on (a) January 1, 1973; or (b) the date of the most recent amendment which substantially increased pension benefits (a "Substantive Amendment Date").  The limitations set forth in this Article shall become applicable if:

(a)      The Plan is terminated within ten years after January 1, 1973 (or a Substantive Amendment Date, if applicable);

(b)      The Pension of a Participant becomes payable within such ten year period, or

(c)      The Pension of a Participant becomes payable after such ten year period and the full current costs for the ten year period have not been funded.

    If subparagraph (b) above is applicable, the restrictions shall remain in effect until the later of the expiration of the ten year period or the date on which the full current costs have been funded.

    If a Participant is subject to the provisions of this Article, the Pension payable to him shall not exceed the Pension which can be provided from the greatest of the following:

(a)      The Company's contributions (or funds attributable thereto) which would have been applied to provide benefits for the Participant if the Plan had not been amended on the Substantive Amendment Date and had not continued without change;

(b)      $20,000.00; or

(c)      The sum of (1) the Company's contributions (or funds attributable thereto) which would have been applied to provide benefits for the Participant if the Plan had been terminated on the day before the Substantive Amendment Date (if applicable) and (2) an amount computed by multiplying the number of years for which the current costs of the Plan have been met after January 1, 1973 (or the Substantive Amendment Date, if applicable), by 20% of the first $50,000.00 of the Participant's average annual compensation during his last 5 years of employment.

    The limitations described above may be exceeded for the purposes of making current benefit payments to retired Participants who would otherwise be subject to such restrictions, provided that (a) the contributions which may be used for any such retired Participant in accordance with the restrictions heretofore indicated are applied to provide either a level amount of pension in the basic form of benefit provided for under the Plan for such Participant, or a level amount of pension in an optional form of benefit not greater in amount than the level amount of Pension under the basic form of benefit, and (b) the pension thus provided is supplemented by monthly payments to the extent necessary to provide the full pension in the basic form called for by the Plan, and (c) such supplemental payments are made only if the full current costs of the Plan have been met or if the aggregate of such supplemental payments for all such retired Participants does not exceed the aggregate Company contributions already made under the Plan in the year then current.

    The limitations in this Article shall automatically become inoperative and of no effect upon a ruling by the Internal Revenue Service that they are not required.

ARTICLE XIII

PLAN TERMINATION

    Section 13.1 - Right to Terminate.  In accordance with the procedures set forth in this Article, the Company and the Union have the right to terminate the Plan at any time.  In the event of the dissolution, merger, consolidation or reorganization of the Company, the Plan shall terminate and the Retirement Fund shall be liquidated unless the Plan is continued by a successor to the Company in accordance with Section 10.1.  Subject to applicable requirements, if any, of ERISA governing termination of "Employee Pension Benefit Plans," the Trustees shall liquidate the Retirement Fund in accordance with the provisions of this Article.

    Section 13.2 - Partial Termination.  Upon termination of the Plan with respect to a group of Participants which constitutes a partial termination of the Plan, the Trustees shall allocate for the benefit of the Eligible Employees then or theretofore employed by the Employer with respect to which the Plan is being terminated the proportionate interest of such Participants in the Retirement Fund in the manner and the order set forth in Section 4044 of ERISA.  The Actuary shall make this determination on the basis of the contributions made by the Company, the provisions of this Article, and such other considerations as the Actuary deems appropriate.  The Fiduciaries shall have no responsibility with respect to the determination of any such proportionate interest.

    Section 13.3 - Liquidation of Retirement Fund.  Upon termination of the Plan, or upon termination of employment of a group of Participants constituting a partial termination of the Plan, each such Participant's Accrued Benefit, based on his Accrual Service prior to the date of termination shall become fully vested and nonforfeitable to the extent funded.  Upon complete termination of the Plan, the assets of the Retirement Fund shall be liquidated (after provision is made for the expenses of liquidation), subject to the requirements of PBGC by the payment or provision for the payment of benefits in the following order of preference:

(a)      Certain Benefits Payable Three Years Prior to Termination: The available assets of the Retirement Fund shall first be allocated to provide pensions that became payable three or more years before the effective date of Plan termination, or that could have become payable at the beginning of such three year period had the Participant not deferred the commencement of his Pension by failing to elect earlier commencement, or that could have become payable had a Participant's retirement occurred immediately prior to the beginning of such three year period, provided that:

(i)       The portion of the pension payable to a Participant or the beneficiary of a Participant (or that could have been payable) shall be based on the provisions of the Plan in effect five years prior to the effective date of Plan termination; and for this purpose, the first Plan Year in which an amendment became effective, or was adopted, if later, shall constitute the first year an amendment was in effect; and further provided that:

(ii)      If the pension payable under the Plan had been reduced, either by amendment or due to the form in which the pension is being paid, during the three year period ending on the effective date of Plan termination, then the lowest benefit in pay status during such three year period shall be considered the benefit in pay status for purposes of this category (a).

(b)      Other Benefits Eligible for Termination Insurance: To the extent that the amount of a pension has not been provided in the foregoing category (a), the remaining assets shall be allocated to provide any pension provided under the Plan for a Participant whose employment terminated prior to the effective date of Plan termination, or any immediate or deferred pension that would have been payable to or on behalf of a Participant had his employment terminated for a reason other than death on the effective date of Plan termination, provided that the amount of a pension to be provided under this category (b) shall be determined as follows:

(i)       The portion of the pension payable to a Participant or the beneficiary of a Participant (or that could have been payable) based on the provisions of the Plan in effect five years prior to the effect date of Plan termination; and for this purpose, the first Plan Year in which an amendment became effective, or was adopted, if later, shall constitute the first year an amendment was in effect; plus

(ii)      The portion of the pension payable to a Participant or the beneficiary of a Participant which would have been included in (i) above had the Plan or a Plan amendment been in effect five years prior to the effective date of Plan termination, determined as follows: 20% for each Plan Year (less than five) that the Plan or an amendment thereto was in effect, multiplied by the amount that would have been included under subparagraph (1) for such Participant or beneficiary had the Plan or the  amendment been in effect for five Plan Years as of the effective date of Plan termination;

(iii)     No benefit payable under this category (b) to a Participant or beneficiary shall exceed an amount with an actuarial value of a monthly benefit in the form of a life only annuity commencing at age 65 equal to $750.00 multiplied by a fraction, the numerator of which is the contribution and benefit base determined under Section 230 of the Social Security Act in effect at the effective date of Plan termination and the denominator of which is such contribution and benefit base in effect in calendar year 1974.

(c)      Other Vested Benefits: To the extent that the amount of a pension has not been provided in the foregoing categories (a) and (b), the remaining assets in the Retirement Fund shall be allocated to provide the benefit payable under the Plan to or on behalf of a Participant whose employment terminated prior to the effective date of Plan termination, or that would have been payable to or on behalf of a Participant had his employment terminated for a reason other than death on the effective date of Plan termination, in the following order of preference:

(i)       to any Participant who had retired under Section 4.1 prior to the effective date of Plan termination or who was eligible to retire under said Section on the effective date of Plan termination;

(ii)      to any Participant who had retired under Section 4.3 prior to the effective date of Plan termination or who was eligible to retire under said Section on the effective date of Plan termination; or

(iii)     to any Participant whose employment had terminated with entitlement to a deferred vested pension under Section 4.4 prior to the effective date of Plan termination or who would have been eligible for a deferred vested pension under said Section had his employment terminated on the effective date of Plan termination.

(d)      Other Benefits: To the extent that the amount of pension has not been provided in the foregoing categories (a), (b) and (c), the remaining assets shall be allocated to provide the benefit accrued under the Plan, without regard to the satisfaction of the vesting requirements of this Plan, with respect to each Participant whose employment had not terminated as of the effective date of Plan termination, according to the respective actuarial value of each such Participant's Accrued Benefit.

    If the assets of the Retirement Fund applicable to any of the above categories are insufficient to provide full benefits for all persons in such group, the benefits otherwise payable to such persons shall be reduced proportionately.  The Actuary shall calculate the allocation of the assets of the Retirement Fund in accordance with the above priority categories, and certify his calculations to the Fiduciaries.  No liquidation of assets and payment of benefits (or provision therefor) shall actually be made by the Trustee until after it is advised by the Company in writing that applicable requirements, if any, of ERISA governing termination of "Employee Pension Benefit Plans" have been, or are being complied with or that appropriate authorizations, waivers, exemptions or variances have been, or are being, obtained.

    Section 13.4 - Manner of Distribution.  Subject to the foregoing provisions of Article XIII and applicable PBGC rules, any distribution after termination of the Plan may be made, in whole or in part, to the extent that no discrimination in value results, in cash, in securities or other assets in kind, or in non-transferable annuity contracts, as the Trustees, in their discretion, shall determine.

    Section 13.5 - Residual Amounts.  In no event shall the Company or any participating Employer receive any amounts from the Retirement Fund upon termination of the Plan.  After satisfaction of all liabilities of the Plan, any amounts which remain shall be distributed to Participants according to the following formula: To each Participant, a fraction of the Retirement Fund's residual assets equal to the fraction attained when the numerator is the Participant's total Years of Accrual Service and the denominator is the total years of Accrual Service for all Participants in the Plan.

ARTICLE XIV

CONSTRUCTION

    Section 14.1 - Construction.  The masculine gender, where appearing in the Plan, shall be deemed to include the feminine gender, and the singular may include the plural, unless the context clearly indicates to the contrary.  The words "hereof", "herein", "hereunder", and other similar compounds of the word "here" shall mean and refer to the entire Plan, not to any particular provision or Section.

    Section 14.2 - Authority of Trustees: In discharging the duties assigned to them under this Plan, the Trustees and, to the extent authority has been delegated to the Plan Administrator and his or her delegates, all of such persons and his or her delegates have the discretion and final authority to interpret and construe the terms of the Plan; to determine coverage and eligibility for benefits under the Plan; and to make all other determinations deemed necessary or advisable for the discharge of their duties or the administration of the Plan.  The discretionary authority of the Trustees, the Plan Administrator and their respective delegates is final, absolute, conclusive and exclusive, and binds all parties so long as it is exercised in good faith.  It is specifically intended that judicial review of any decision of the Trustees, the Plan Administrator or their delegates be limited to the arbitrary and capricious standard of review.

GRAPHIC COMMUNICATIONS                           BMC INDUSTRIES, INC.

INTERNATIONAL UNION, TWIN                        

CITIES LOCAL 6A

By: /s/C. David Jara                                                     By: /s/Brad Carlson
 

UNION TRUSTEES:                                                 COMPANY TRUSTEES:

/s/C. David Jara                                                           /s/Wesley S. Cohen

/s/Brian C. Moser                                                        /s/Dennis Malecek

/s/Richard W. Pruden                                                  /s/Brad Carlson

/s/Donald F. Schuldt                                                   /s/Cynthia Wingert

Dated as of this 18th day of June, 2002.

EX-10.48

 

AMENDMENT 1

TO THE

SEVENTH RESTATED GRAPHIC COMMUNICATIONS

INTERNATIONAL UNION, TWIN CITIES

LOCAL 6A - BUCKBEE-MEARS PENSION PLAN

These amendments reflect the applicable provisions of the model amendments to comply with the Economic Growth and Tax Relief Reconciliation Act of 2001, as amended ("EGTRRA"), released by the Internal Revenue Service in IRS Notice 2001-57, are intended as good faith compliance with the requirements of EGTRRA, and are to be construed in accordance with EGTRRA and guidance issued thereunder.

Pursuant to Article IX of the Seventh Restated Graphic Communications International Union, Twin Cities Local 6A - Buckbee-Mears Pension Plan, hereinafter referred to as the "Plan", the Trustees hereby amend said Plan as follows:

I.

A new subsection 4.14(e) is hereby added to the Plan to read in its entirety as follows:

"(e)    (i)    Effective Date.  Notwithstanding the foregoing to the contrary, this section shall be effective for limitation years ending after December 31, 2001.

(ii)    Effect on Participants.  Benefit increases resulting from the increase in the limitations of section 415(b) of the Code will be provided to all employees participating in this Plan who have one (1) Hour of Service ending after December 31, 2001.

Definitions.

(iii)    Defined benefit dollar limitation.  The "defined benefit dollar limitation" is $160,000, as adjusted, effective January 1 of each year, under section 415(d) of the Code in such manner as the Secretary shall prescribe, and payable in the form of a straight life annuity.  A limitation as adjusted under section 415(d) of the Code will apply to limitation years ending with or within the calendar year for which the adjustment applies.

(iv)Maximum permissible benefit.  The "maximum permissible benefit" is the lesser of the defined benefit dollar limitation or defined benefit compensation limitation (both adjusted where required, as provided in (a) and, if applicable, in (b) or (c) below).

(a)    If the Participant has fewer than 10 years of participation in the Plan, the defined benefit dollar limitation shall be multiplied by a fraction, (i) the numerator of which is the number of years (or part thereof) of participation in the Plan and (ii) the denominator of which is 10.  In the case of a Participant who has fewer than 10 years of service with the employer, the defined benefit compensation limitation shall be multiplied by a fraction, (i) the numerator of which is the number of years (or part thereof) of service with the employer and (ii) the denominator of which is 10.

(b)    If the benefit of a Participant begins prior to age 62, the defined benefit dollar limitation applicable to the Participant at such earlier age is an annual benefit payable in the form of a straight life annuity beginning at the earlier age that is the actuarial equivalent of the defined benefit dollar limitation applicable to the Participant at age 62 (adjusted under (a) above, if required).  The defined benefit dollar limitation applicable at an age prior to age 62 is determined as the lesser of (i) the actuarial equivalent (at such age) of the defined benefit dollar limitation computed using the interest rate and mortality table (or other tabular factor) specified in Section 4.12(a) and (ii) the actuarial equivalent (at such age) of the defined benefit dollar limitation computed using a 5 percent interest rate and the applicable mortality table as defined in Section 4.12(a) of the Plan.  Any decrease in the defined benefit dollar limitation determined in accordance with this paragraph (b) shall not reflect a mortality decrement if benefits are not forfeited upon the death of the Participant.  If any benefits are forfeited upon death, the full mortality decrement is taken into account.

(c)    If the benefit of a Participant begins after the Participant attains age 65, the defined benefit dollar limitation applicable to the Participant at the later age is the annual benefit payable in the form of a straight life annuity beginning at the later age that is actuarially equivalent to the defined benefit dollar limitation applicable to the Participant at age 65 (adjusted under (a) above, if required).  The actuarial equivalent of the defined benefit dollar limitation applicable at an age after age 65 is determined as (i) the lesser of the actuarial equivalent (at such age) fo the defined benefit dollar limitation computed using the interest rate and mortality table (or other tabular factor) specified in Section 4.12(a) of the Plan and (ii) the actuarial equivalent (at such age) of the defined benefit dollar limitation computed using a 5 percent interest rate assumption and the applicable mortality table as defined in Section 4.12(a) of the Plan.  For these purposes, mortality between age 65 and the age at which benefits commence shall be ignored.

II.

A new subsection 4.12(c) is hereby added to the Plan to read in its entirety as follows:

"(c)    Effective for distributions made after December 31, 2001, for purposes of the direct rollover provisions of this Section 4.12, an eligible retirement plan shall also mean an annuity contract described in section 403(b) of the Code and an eligible plan under section 457(b) of the Code which is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state and which agrees to separately account for amounts transferred into such plan from this Plan.  The definition of eligible retirement plan shall also apply in the case of a distribution to a surviving spouse, or to a spouse or former spouse who is the alternate payee under a qualified domestic relations order, as defined in section 414(p) of the Code."

III.

Section 11.5 is hereby added to the Plan to read in its entirety as follows:

11.5  Modifications of Top-Heavy Rules effective after December 31, 2001.

(a) Effective date.  This section shall apply for purposes of determining whether the Plan is a top-heavy plan under section 416(g) of the Code for Plan Years beginning after December 31, 2001, and whether the Plan satisfies the minimum benefits requirements of section 416(c) of the Code for such years.  This section amends Article XI of the Plan.

(b)Determination of top-heavy status.

1.    Key employee.  Key employee means any employee or former employee (including any deceased employee) who at any time during the Plan Year that includes the determination date was an officer of the employer having annual compensation greater than $130,000 (as adjusted under section 416(i)(1) of the Code for Plan Years beginning after December 31, 2002), a 5-percent owner of the employer, or a 1-percent owner of the employer having annual compensation of more than $150,000.  For this purpose, annual compensation means compensation of more than $150,000.  For this purpose, annual compensation means compensation within the meaning of section 415(c)(3) of the Code.  The determination of who is a key employee will be made in accordance with section 416(i)(1) of the Code and the applicable regulations and other guidance of general applicability issued thereunder.

2.    Determination of present values and amounts.  This section (b)(2) shall apply for purposes of determining the present values of accrued benefits and the amounts of account balances of employees as of the determination date.

(i)    Distributions during year ending on the determination date.  The present values of accrued benefits and the amounts of account balances of an employee as of the determination date shall be increased by the distributions made with respect to the employee under the Plan and any plan aggregated with the Plan under section 416(g)(2) of the Code during the 1-year period ending on the determination date.  The preceding sentence shall also apply to distributions under a terminated plan which, had it not been terminated, would have been aggregated with the Plan under section 416(g)(2)(A)(i) of the Code.  In the case of a distribution made for a reason other than separation from service, death, or disability, this provision shall be applied by substituting 5-year period for 1-year period.

(ii)    Employees not performing services during year ending on the determination date.  The accrued benefits and accounts of any individual who has not performed services for the employer during the 1-year period ending on the determination date shall not be taken into account.

(c)    Minimum benefits.  For purposes of satisfying the minimum benefit requirements of section 416(c)(1) of the Code and the Plan, in determining years of service with the employer, any service with the employer shall be disregarded to the extent that such service occurs during a Plan Year when the Plan benefits (within the meaning of section 410(b) of the Code) no key employee or former key employee.

IV.

Except as amended herein, the terms and provisions of the Seventh Restated Graphic Communications International Union, Twin Cities Local 6A - Buckbee-Mears Pension Plan, shall be and remain in full force and effect.

V.

This Amendment shall be effective as provided herein.

IN WITNESS WHEREOF, the Trustees have caused this Amendment 1 to the Seventh Restated Graphic Communications International Union, Twin Cities Local 6A - Buckbee-Mears Pension Plan to be executed as of this 30st  day of December, 2002.

GRAPHIC COMMUNICATIONSBMC INDUSTRIES, INC.

INTERNATIONAL UNION, TWIN

CITIES LOCAL 6A

By:  /s/C. David Jara                                       By: /s/Brad Carlson

UNION TRUSTEES:                                           COMPANY TRUSTEES:

/s/C. David Jara                                                   /s/Wesley S. Cohen

/s/Brian C. Moser                                                /s/Dennis Malecek

/s/Richard W. Pruden                                           /s/Brad Carlson

/s/Donald F. Schuldt                                            /s/John Oyen

Dated this 31st day of December, 2002.

EX-21.1

EXHIBIT 21-1

SUBSIDIARIES

OF

BMC INDUSTRIES, INC.

1.     Buckbee-Mears Europe GmbH

2.     Buckbee-Mears Hungary Kft.

3.     Buckbee-Mears Medical Technologies, LLC

4.     Vision-Ease Lens, Inc.

5.     Vision-Ease Lens Azusa, LLC

6.     Vision Ease Lens Limited

7.     Vision-Ease Canada, Ltd.

8.     P. T. Vision-Ease Asia, joint venture with P.T. Astron Lensindo Nusa

9.     Buckbee-Mears Holding Company B.V.

10.   Buckbee-Mears European Holding Company B.V.

11.   Buckbee-Mears Deutschland Holding GmbH & Company KG

12.   Vision-Ease France SAS

13.   Vision-Ease Deutschland GmbH

14.   Buckbee-Mears Deutschland Verwaltungs GmbH

15.   Buckbee-Mears Netherlands B.V.

EX-23.1

Exhibit 23.1

Consent of Independent Auditors

We consent to the incorporation by reference in the Registration Statement (Form S-8 No. 33-55089) pertaining to the BMC Industries, Inc. 1994 Stock Incentive Plan, in the Registration Statement (Form S-8, No. 33-38684) pertaining to the BMC Industries, Inc. Restated and Amended 1994 Stock Incentive Plan and in the Registration Statement (Form S-8, No. 333-81952) pertaining to the BMC Industries, Inc. Savings and Profit Sharing Plan of our report dated January 31, 2003 with respect to the consolidated financial statements of BMC Industries, Inc. included in the Annual Report (Form 10-K) for the year ended December 31, 2002.

/s/Ernst & Young LLP

Minneapolis, Minnesota

March 25, 2003

EX-99.1

EXHIBIT 99.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS 

ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of BMC Industries Inc (the "Company") on Form 10-K for the period ended December 31, 2002 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Douglas C. Hepper, Chief Executive Officer of the Company, certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

     1)       The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

     2)       The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

March 26, 2003

/s/Douglas C. Hepper

Douglas C. Hepper

Chairman, President and

Chief Executive Officer

EX-99.2 13 exhibit_99-2.htm

EXHIBIT 99.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS 

ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of BMC Industries Inc (the "Company") on Form 10-K for the period ended December 31, 2002 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Curtis E. Petersen, Chief Financial Officer of the Company, certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

     1)       The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

     2)       The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

March 25, 2003

/s/Curtis E. Petersen

Curtis E. Petersen

Senior Vice President and

Chief Financial Officer 

-----END PRIVACY-ENHANCED MESSAGE-----

EX-99.2

EXHIBIT 99.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS 

ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of BMC Industries Inc (the "Company") on Form 10-K for the period ended December 31, 2002 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Curtis E. Petersen, Chief Financial Officer of the Company, certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to the best of my knowledge:

     1)       The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

     2)       The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

March 25, 2003

/s/Curtis E. Petersen

Curtis E. Petersen

Senior Vice President and

Chief Financial Officer 

-----END PRIVACY-ENHANCED MESSAGE-----