0000916641-99-000921.txt : 19991124
0000916641-99-000921.hdr.sgml : 19991124
ACCESSION NUMBER: 0000916641-99-000921
CONFORMED SUBMISSION TYPE: S-8
PUBLIC DOCUMENT COUNT: 5
FILED AS OF DATE: 19991123
EFFECTIVENESS DATE: 19991123
FILER:
COMPANY DATA:
COMPANY CONFORMED NAME: SUNTRUST BANKS INC
CENTRAL INDEX KEY: 0000750556
STANDARD INDUSTRIAL CLASSIFICATION: NATIONAL COMMERCIAL BANKS [6021]
IRS NUMBER: 581575035
STATE OF INCORPORATION: GA
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: S-8
SEC ACT:
SEC FILE NUMBER: 333-91519
FILM NUMBER: 99763147
BUSINESS ADDRESS:
STREET 1: 303 PEACHTREE ST N E
CITY: ATLANTA
STATE: GA
ZIP: 30308
BUSINESS PHONE: 4045887711
MAIL ADDRESS:
STREET 1: 303 PEACHTREE ST N E
CITY: ATLANTA
STATE: GA
ZIP: 30308
S-8
1
SUNTRUST 401K
Registration No. 333-________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------
SunTrust Banks, Inc.
(Exact name of registrant as specified in its charter)
GEORGIA 58-1575035
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
303 Peachtree Street, N.E.
Atlanta, Georgia 30308
(Address of Principal Executive Offices)
SunTrust Banks, Inc. 401(k) Plan
----------------------------------
(Full Title of the Plan)
------------
Raymond D. Fortin
Senior Vice President
SunTrust Banks, Inc.
303 Peachtree Street, N.E.
Atlanta, Georgia 30308
(Name and address of Agent for Service)
404-588-7165
(Telephone number, including area code, of agent for service)
------------
CALCULATION OF REGISTRATION FEE
---------------------------- ------------------------- ------------------------- ------------------------- -------------------------
Amount Proposed Maximum Proposed Maximum
Title of Securities to to be Offering Price Aggregate Amount of
be Registered Registered Per Share(1) Offering Price(1) Registration Fee(1)
---------------------------- ------------------------- ------------------------- ------------------------- -------------------------
Common Stock, $1.00
par value per share..... 8,000,000 $72.41 $579,280,000 $161,040
---------------------------- ------------------------- ------------------------- ------------------------- -------------------------
(1) Determined pursuant to Rule 457(c) and (h)(l) based on $72.41, the average
of the high and low prices of the registrant's common stock on November 19,
1999, as reported on the New York Stock Exchange.
====================================================================================================================================
In addition, pursuant to Rule 416(c) under the Securities Act of 1933, this
Registration Statement also covers an indeterminate amount of interests to be
offered or sold pursuant to the employee benefit plan described herein.
SUNTRUST BANKS, INC.
This Registration Statement covers 8,000,000 additional shares of
common stock, par value $1.00 per share (the "Common Stock") of SunTrust Banks,
Inc. (the "Company"), issuable pursuant to the SunTrust Banks, Inc. 401(k) Plan
(the "Savings Plan"). The Company initially registered the issuance of 2,500,000
shares of Common Stock in connection with the Savings Plan on its Registration
Statement on Form S-8 (Registration No. 33-50796) as filed with the Securities
and Exchange Commission (the "Commission") on August 12, 1992. The contents of
Registration Statement No. 33-50756 are incorporated by reference herein.
Pursuant to Rule 429, the Prospectus related to shares of Common Stock
registered pursuant to this Registration Statement for the Savings Plan also
relates to shares of Common Stock registered pursuant to Registration Statement
No. 33-50756.
PART II
-------
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
--------------------------------------------------
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed by SunTrust Banks, Inc. (the "Company")
with the Securities and Exchange Commission (the "Commission") are incorporated
herein by reference:
(a) The Company's Annual Report on Form 10-K for the year ended
December 31, 1998, pursuant to Section 13 of the Securities Exchange Act
of 1934 (the "Exchange Act").
(b) The Company's Quarterly Reports on Form 10-Q for the fiscal quarters
ended March 31, 1999, June 30, 1999 and September 30, 1999.
(c) The Company's Current Reports on Form 8-K dated January 12, 1999,
January 15, 1999, and October 18, 1999.
(d) The description of the Company's Common Stock, par value $1.00 per
share, contained on pages 2 to 9 in Amendment No. 1, dated August 4, 1987,
to its Registration of Common Stock on Form 8-B, dated June 10, 1985, filed
under Section 12(b) of the Exchange Act, including any amendments or reports
filed for the purpose of updating such description.
All documents subsequently filed by the Company or the Savings Plan
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act after the
effective date of this Registration Statement and prior to the filing of a
post-effective amendment which indicates that all securities offered hereby have
been sold or which deregisters all securities remaining unsold, shall be deemed
to be incorporated by reference herein and to be a part hereof from the date of
the filing of such documents. Any statement contained in a document incorporated
by reference herein shall be deemed to be modified or superseded for purposes of
this Registration Statement to the extent that a statement herein modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute a part of this
Registration Statement.
ITEM 4. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The legality of the securities offered hereby has been passed upon by
Raymond D. Fortin, Esq., Senior Vice President of SunTrust, who beneficially
owns 23,000 shares of Common Stock and has options to purchase 4,800 shares of
Common Stock.
2
ITEM 5. EXHIBITS.
The following exhibits are filed as part of this Registration Statement:
Exhibit Number Description
4.1 Articles 5, 6, 7, 8, 11 and 13 of the Amended
and Restated Articles of Incorporation of the
Company, effective as of November 14, 1989,
incorporated by reference to Exhibit 3.1 to the
Company's Annual Report on Form 10-K for the
year ended December 31, 1989.
4.2 Articles I, IV, VII, VIII, X and XI of the
Amended and Restated Bylaws of the
Company, effective as of February 10,
1998, incorporated by reference to Exhibit
3 to Registration Statement No. 333-46093.
4.3 Amended and Restated SunTrust Banks, Inc. 401(k)
Plan.
4.4 SunTrust Banks, Inc. 401(k) Trust Agreement
(formerly known as the SunTrust Banks, Inc.
Employee Stock Ownership Trust), as amended.
5.1 Opinion of Raymond D. Fortin, Esq., as to the
legality of the Common Stock being registered.
23.1 Consent of Arthur Andersen LLP.
23.2 Consent of Raymond D. Fortin, Esq. (contained in
his opinion filed as Exhibit 5.1).
24.1 Power of Attorney (included on Signature Page).
3
SIGNATURES
----------
THE REGISTRANT. Pursuant to the requirements of the Securities Act of
1933, SunTrust Banks, Inc. certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-8 and has duly caused
this registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Atlanta, State of Georgia, on the 23rd
day of November, 1999.
SUNTRUST BANKS, INC.
By: /s/ L. Phillip Humann
------------------------
L. Phillip Humann
Chairman of the Board, President
and Chief Executive Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below, constitutes and appoints John W. Spiegel and Raymond D. Fortin,
and each of them, his true and lawful attorneys-in-fact and agents, with full
power of substitution and resubstitution, to do any and all acts and things and
execute, in the name of the undersigned, any and all instruments which said
attorneys-in-fact and agents may deem necessary or advisable in order to enable
SunTrust Banks, Inc. to comply with the Securities Act of 1933 and any
requirements of the Securities and Exchange Commission in respect thereof, in
connection with the filing with the Securities and Exchange Commission of the
registration statement on Form S-8 under the Securities Act of 1933, including
specifically but without limitation, power and authority to sign the name of the
undersigned to such registration statement, and to file the same with all
exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to do and to perform each and
every act and thing requisite or necessary to be done in and about the premises,
as fully and to all intents and purposes as the undersigned might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, and any of them, or their substitutes, may lawfully do or cause to be
done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated as of the 23rd day of November, 1999.
/s/ L. Phillip Humann
-------------------------
L. Phillip Humann Chairman of the Board, President, Chief Executive
Officer and Director
(Principal Executive Officer)
/s/ John W. Spiegel
-------------------------
John W. Spiegel Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
/s/ William P. O'Halloran
-------------------------
William P. O'Halloran Senior Vice President and Chief Accounting Officer
(Principal Accounting Officer)
/s/ Richard G. Tilghman
-------------------------
Richard G. Tilghman Director and Vice Chairman
/s/ J. Hyatt Brown
-------------------------
J. Hyatt Brown Director
4
/s/ Alston D. Correll
-----------------------------------------------------------
Alston D. Correll Director
/s/ A. W. Dahlberg
-----------------------------------------------------------
A. W. Dahlberg Director
/s/ David H. Hughes
-----------------------------------------------------------
David H. Hughes Director
/s/ M. Douglas Ivester
-----------------------------------------------------------
M. Douglas Ivester Director
/s/ Summerfield K. Johnston, Jr.
-----------------------------------------------------------
Summerfield K. Johnston, Jr. Director
/s/ Joseph L. Lanier, Jr.
-----------------------------------------------------------
Joseph L. Lanier, Jr. Director
/s/ Frank E. McCarthy
-----------------------------------------------------------
Frank E. McCarthy Director
/s/ G. Gilmer Minor, III
-----------------------------------------------------------
G. Gilmer Minor, III Director
/s/ Larry L. Prince
-----------------------------------------------------------
Larry L. Prince Director
/s/ Scott L. Probasco, Jr.
-----------------------------------------------------------
Scott L. Probasco, Jr. Director
/s/ R. Randall Rollins
-----------------------------------------------------------
R. Randall Rollins Director
/s/ Frank S. Royal, MD.
-----------------------------------------------------------
Frank S. Royal, M.D. Director
/s/ James B. Williams
-----------------------------------------------------------
James B. Williams Director
5
INDEX TO EXHIBITS
Exhibit Number Description
---------------- ------------------------------------------------------------
4.1 Articles 5, 6, 7, 8, 11 and 13 of the Amended and Restated
Articles of Incorporation of the Company, effective as of
November 14, 1989, incorporated by reference to Exhibit 3.1
to the Company's Annual Report on Form 10-K for the year
ended December 31, 1989.
4.2 Articles I, IV, VII, VIII, X and XI of the Amended and
Restated Bylaws of the Company, effective as of
February 10, 1998, incorporated by reference to Exhibit 3 to
Registration Statement No. 333-46093.
4.3 Amended and Restated SunTrust Banks, Inc. 401(k) Plan.
4.4 SunTrust Banks, Inc. 401(k) Trust Agreement (formerly known
as the SunTrust Banks, Inc. Employee Stock Ownership Trust),
as amended.
5.1 Opinion of Raymond D. Fortin, Esq., as to the legality of
the Common Stock being registered.
23.1 Consent of Arthur Andersen LLP.
23.2 Consent of Raymond D. Fortin, Esq. (contained in his opinion
filed as Exhibit 5.1).
24.1 Power of Attorney (included on Signature Page).
6
EX-4
2
EXHIBIT 4.3
Exhibit 4.3
SUNTRUST BANKS, INC.
401(k) PLAN
AMENDED AND RESTATED AS OF
JANUARY 1, 1997
SUNTRUST 401(k) PLAN
TABLE OF CONTENTS
-----------------
SECTION I - INTRODUCTION AND HISTORY 1
1.1 Sun Banks, Inc. SunShare Plan 1
1.2 Section 401(k) Provisions 1
1.3 ESOP Provisions 1
1.4 SunTrust Banks, Inc. as Plan Sponsor 1
1.5 SunTrust ESOP 1
1.6 SunTrust 401(k) Plan 2
1.7 Amendment and Qualification 2
1.8 Exclusive Benefit 2
1.9 Designation of Companies 2
SECTION II - DEFINITIONS 2
2.1 Construction 2
2.2 Active Participant 2
2.3 Actual Deferral Percentage 2
2.5 Annual Addition 4
2.6 Available Compensation 4
2.7 Base Compensation 4
2.8 Beneficiary 5
2.9 Board 5
2.10 Break In Service 5
2.11 Certain Other Participants 5
2.12 Code 5
2.13 Company Contribution 5
2.14 Company 6
2.15 Compensation Committee 6
2.16 Compensation Deferral Agreement 6
2.17 Corporation 6
2.18 Current Obligations 6
2.19 Date of Employment 6
2.20 Disability 6
2.21 Effective Date 6
2.22 Elective Contribution 6
2.23 Eligible Employee 6
2.24 Employee 7
2.25 ERISA 7
2.26 Employer Stock 7
2.27 Employer Stock Suspense Account 8
2.28 Employment 8
2.29 Employment Termination Date 8
2.30 Entry Date 8
2.31 ESOP 9
2.32 Exempt Loan 9
2.33 Guaranteed Matching Contribution 9
2.34 Hardship 9
2.35 Highly Compensated Active Participant 9
2.36 Hours of Service 10
2.37 Investment Fund 13
2.38 Key Employee 13
i
2.39 Leave of Absence 13
2.40 Limitation Year 14
2.41 Matching Contributions 14
2.42 Matching Contribution Percentage 14
2.43 Participant 15
2.44 Performance Matching Contribution 15
2.45 Plan 15
2.46 Plan Year 15
2.47 Plan Committee 15
2.48 Prior PAYSOP 16
2.49 Prior Plan 16
2.50 Qualified Participant 16
2.51 Retirement 16
2.52 Service 16
2.53 Taxable Wages 18
2.54 Top-Heavy Determination Date 18
2.55 Top-Heavy Plan 19
2.56 Total Account 19
2.57 Trust Agreement 19
2.58 Trust Fund 19
2.59 Trustee 19
2.60 Valuation Date 19
2.61 Vested Account 19
2.62 Voluntary Contributions 19
SECTION III - ELIGIBILITY AND PARTICIPATION 19
3.1 Participation 19
3.2 Participation of Reemployed Individuals 20
3.3 Prior Service of Reemployed Individuals 20
SECTION IV - CONTRIBUTIONS 20
4.1 Company Contribution 20
4.3 Changes to Contribution Rate 21
4.4 Matching Contributions 22
4.5 Minimum Contribution 23
4.6 Delivery of Contributions To Trustee 24
4.7 Separate Accounts and Non-Diversion of Funds 24
4.8 Return of Company Contributions 24
SECTION V - MAXIMUM CONTRIBUTIONS 25
5.1 Limitations on Elective Contributions 25
5.2 Procedure if Elective Contribution
Limitation Exceeded 25
5.3 Limitation on Matching Contributions 26
5.5 Multiple Use Limitation 28
5.6 Limitation on Company Contributions 29
5.7 Return of Excess Elective Contributions 29
5.8 General Limitations 29
5.9 Annual Addition 30
ii
5.10 Limitation for Combination of Plans 31
5.11 Preclusion of Excess Annual Additions 32
5.12 Treatment of Similar Plans 34
SECTION VI - VESTING AND FORFEITURES 35
6.1 Vested Account 35
6.2 Amendments to Vesting Schedule 35
6.3 Forfeiture Reinstatement 35
SECTION VII - ACCOUNTS AND ALLOCATIONS 38
7.1 Individual Accounts 38
7.2 General Accounts 39
7.3 Valuation Date Adjustments and Allocations 39
7.4 Valuation of Employer Stock Contributions 46
7.5 Allocation Report 46
7.6 Allocation Corrections 46
SECTION VIII - INVESTMENT OF DEPOSITS AND CONTRIBUTIONS 46
8.1 Investment 47
8.2 Purchase of Employer Stock 48
8.3 Investment Options 48
8.4 Transfer of Investments 48
8.5 Special Rules Respecting Stock Elections 49
8.6 Election by Qualified Participant 49
8.7 Diversification Options 49
SECTION IX - DISTRIBUTIONS, WITHDRAWALS AND LOANS 50
9.1 Distributions Upon Disability,
Retirement or Termination of
Employment 50
9.2 Time of Payment 50
9.4 Limited Lump-Sum Payments 51
9.5 Limitation on Commencement and
Period of Distribution 52
9.6 Distribution to Alternate Payee
Pursuant to a Qualified
Domestic Relations Order 55
9.7 Manner of Distribution 56
9.8 Payment Options 57
9.9 Rollover to Eligible Retirement Plan 59
9.10 Designation of Beneficiary 60
9.11 Withdrawal of Benefits 61
9.12 Participant Loans 64
9.13 Put Option 66
SECTION X - TOP-HEAVY PLANS 68
10.1 Top-Heavy Defined 68
10.2 Top-Heavy Valuation Date 69
10.3 Top-Heavy Group Defined 69
10.4 Adjusted Section 415 Limitations 70
10.5 Anti-Cutback Rule 71
10.6 Adjustments to Accrued Benefit 71
10.7 Employees Included in Computations 71
iii
SECTION XI - ADMINISTRATION OF THE PLAN 71
11.1 Designation of Responsibility 71
11.2 Responsibility of the Plan Committee 73
11.3 Responsibility of the Compensation Committee 74
11.4 Responsibility of the Board 74
11.5 Records of the Plan Committee 75
11.6 Plan Committee Action 75
11.7 Plan Committee Disqualification 75
11.8 Compensation 75
11.9 Reliance on Reports 75
11.10 Use of Agents 76
11.11 Benefit Claims 76
11.12 Notice of Committee Action and Appeals 77
11.13 Annual Statements 77
11.14 Unclaimed Benefits 78
11.15 Indemnification 78
SECTION XII - ADMINISTRATION OF THE TRUST FUND 79
12.1 Appointment of Trustee 80
12.2 Management of Fund 80
12.3 Investment of Fund 80
12.4 Voting Employer Stock 80
12.5 Loans Secured by Employer Stock 81
12.6 Conversion of Employer Stock 83
12.7 Acceptance of Transfers and Rollover
Contributions 83
SECTION XIII - AMENDMENT OR TERMINATION OF THE PLAN 84
13.1 Right to Amend or Terminate the Plan 84
13.2 Continuance of Plan After Merger 85
13.3 Distribution Upon Termination 85
13.4 Certain Sales 85
SECTION XIV - MISCELLANEOUS 85
14.1 Facility of Payment 85
14.2 No Contractual Right to Benefits 86
14.3 Plan is Voluntary 86
14.4 Nonalienation of Benefits 86
14.5 Controlling Law 89
14.6 Terminology 89
iv
SUNTRUST BANKS, INC.
401(K) PLAN
(formerly known as the SunTrust Banks, Inc. Employee
Stock Ownership Plan and the Sun Banks, Inc. SunShare Plan)
SECTION I - INTRODUCTION AND HISTORY
------------------------------------
1.1 Sun Banks, Inc. SunShare Plan. Sun Banks, Inc. established the Sun Banks,
Inc. SunShare Plan effective July 1, 1984 for the benefit of its eligible
employees and for the purpose of enabling participating employees the
opportunity to acquire ownership of Sun Banks, Inc. common stock and to
receive retirement benefits in addition to those benefits provided by
other Sun Banks, Inc. benefit plans. The Corporation further desired to
provide its employees with a tax deferral feature in accordance with
Section 401(k) of the Internal Revenue Code of 1986, as amended. The
effective date of the Plan was July 1, 1984.
1.2 Section 401(k) Provisions. Prior to January 1, 1989 this Plan was intended
to qualify as a cash or deferred profit sharing plan which was designed to
invest plan assets primarily in qualifying employer securities and as such
it was designed to meet the requirements of Sections 401(a) and (k) of the
Internal Revenue Code of 1986, as amended.
1.3 ESOP Provisions. After December 31, 1986 this Plan was also intended to
qualify as an Employee Stock Ownership Plan as defined in Section
4975(e)(7) of the Internal Revenue Code of 1986, as amended, and as such
the Trustee may borrow funds and purchase qualifying employer securities.
1.4 SunTrust Banks, Inc. as Plan Sponsor. As of January 1, 1989 SunTrust
Banks, Inc. became the Plan Sponsor pursuant to this plan and trust
agreement as amended and restated as of January 1, 1989 and Sun Banks,
Inc. delegated all of the rights, powers, responsibilities and duties of
the Plan Sponsor to SunTrust Banks, Inc.
1.5 SunTrust ESOP. The Sun Banks, Inc. SunShare Plan was amended and restated
as of January 1, 1989 and was thereafter referred to as the SunTrust
Banks, Inc. Employee Stock Ownership Plan and such amended and restated
plan was adopted and established by SunTrust Banks, Inc. and was amended
by the First Amendment to said plan, effective January 1, 1989.
1
1.6 SunTrust 401(k) Plan. The SunTrust Banks, Inc. Employee Stock Ownership
Plan was amended and restated effective January 1, 1990, and was amended
and restated again effective January 1, 1993, and renamed the SunTrust
Banks, Inc. 401(k) Plan.
1.7 Amendment and Qualification. The SunTrust Banks, Inc. 401(k) Plan is
hereby amended and restated effective January 1, 1997. The SunTrust Banks,
Inc. 401(k) Plan is intended to be an ESOP and a Cash or Deferred
arrangement and is intended to comply with the requirements of Sections
401(a), 401(k), 409(d) as to assets from Prior PAYSOPs, 409(e), (h) and
(o) and 4975(e)(7) of the Code.
1.8 Exclusive Benefit. The Plan is for the exclusive benefit of Participants
and their Beneficiaries. Contributions are made to the Trust Fund by the
Corporation for the purpose of providing benefits to Participants and
Beneficiaries in accordance with the Plan. Except as specifically provided
in other sections of the Plan, no contributions will be used for or
diverted to purposes other than for the exclusive benefit of Participants
and their Beneficiaries.
1.9 Designation of Companies. The Plan Committee periodically will adopt
resolutions designating its subsidiaries as a Company hereunder and
revoking said designations when appropriate. Upon receipt of such
resolutions, the Plan Committee shall be responsible for maintaining a
current list of all Companies under this Plan.
SECTION II - DEFINITIONS
------------------------
2.1 Construction. Unless otherwise required by the context, the terms used
herein have the following meanings:
2.2 Active Participant shall mean a Participant (i) who is an Employee on the
last day of the Plan Year, (ii) who has incurred a Disability during the
Plan Year or (iii) who terminated employment with the Company and all
Affiliates during the Plan Year due to death or Retirement.
2.3 Actual Deferral Percentage with respect to a Plan Year shall mean the
average of the ratios, calculated for all Highly Compensated Active
Participants as a group and for all Certain Other Participants as a
separate group, of (a)
2
the Elective Contributions made on behalf of each Participant in the group
for the applicable Plan Year, to (b) the Participant's Available
Compensation received while an eligible Participant during the applicable
Plan Year. The ratio for Highly Compensated Active Participants shall be
determined with respect to the current Plan Year, but the ratio for
Certain Other Participants shall be determined with respect to the
immediately preceding Plan Year unless the Corporation files an election
to use the ratios for the current Plan Year for both groups. The ratio for
each Participant within a group shall be calculated separately prior to
averaging all ratios for all Participants within a group. For purposes of
this paragraph, the ratio for any Highly Compensated Active Participant
who is eligible to make Elective Contributions during a Plan Year under
two or more arrangements described in Section 401(k) of the Code that are
maintained by the Company or an Affiliate shall be determined as if all
such contributions are made under a single arrangement. If multiple plans
are aggregated for purposes of Section 410(b) of the Code, the provisions
of paragraph 5.12 shall apply. The Plan will take into account the actual
Elective Contribution ratios of all eligible Employees for purposes of the
Actual Deferral Percentage test under paragraph 5.1 and Section 401(k) of
the Code. For this purpose, an eligible Employee is any Employee who is
directly or indirectly eligible to make an Elective Contribution under the
Plan for all or a portion of a Plan Year and includes the following:
(a) an Employee who would be a Plan Participant but for the failure to
make required contributions;
(b) an Employee whose eligibility to make Elective Contributions has
been suspended because of an election (other than certain one-time
elections) not to participate, or due to a hardship distribution;
and
(c) an Employee who cannot make Elective Contributions because of annual
addition limitations under paragraphs 5.8 or 5.10 and Section 415 of
the Code.
In the case of an eligible Employee who makes no Elective Contributions,
the Elective Contribution ratio that is to be included in determining the
Elective Contribution Percentage is zero. If the Plan calculates the
Actual Deferral Percentage for the 1997 Plan Year using the ratio for
Certain Other Participants from
3
the 1996 Plan Year, for purposes of determining the group of Certain Other
Participants, the Plan shall use the Plan definition of Highly Compensated
Active Participants in force on December 31, 1996.
2.4 Affiliate shall mean for any Plan Year (i) the Corporation or any parent,
subsidiary or brother-sister corporation which during such year is a
member of a controlled group of corporations (as defined in section
1563(a) of the Code, after disregarding sections 1563(a)(4) and
1563(e)(3)(C) of the Code) of which the Corporation is a member, (ii) any
trade or business, whether incorporated or not, which during such year is
considered to be under common control with the Corporation under section
414(c) of the Code and (iii) any person or organization which at any time
is a member of an affiliated service group under section 414(m) of the
Code with the Corporation; provided, solely for purposes of paragraphs
5.11 and 5.12 hereof, the phrase "more than 50 percent" shall be
substituted for the phrase "at least 80 percent" each place that the
latter phrase appears in section 1563(a)(1) of the Code. In order to
prevent the avoidance of any employee benefit requirement specified in
Section 414(m)(4) or (n)(3) of the Code through the use of separate
organizations, employee leasing or other arrangements, the term
"Affiliate" shall include such additional entities as may be required in
accordance with Section 414(o) of the Code and the Treasury Regulations
issued thereunder.
2.5 Annual Addition shall mean the amount determined in accordance with
paragraph 5.09 for determining the limitations set forth in Section 415 of
the Code.
2.6 Available Compensation shall mean, for any Plan Year, the sum of (i) the
Participant's Taxable Wages, and (ii) any other contributions made on
behalf of the Participant for the Plan Year which are not currently
includable in gross income by reason of the application of Sections 125,
402(e)(3), 402(h)(1)(B) or 403(b) of the Code (relating to cafeteria
plans, cash or deferred arrangements, salary reduction-type simplified
employee pensions, and tax deferred annuities, respectively); however,
Available Compensation taken into account for an individual for purposes
of this plan shall be limited to $150,000 or such greater amount as may be
provided under Section 401(a)(17) of the Code.
2.7 Base Compensation shall mean the base salary paid during a Plan Year to a
Participant by a Company and shall include, without limitation, vacation
pay,
4
draw for a commission Employee, short-term disability pay, sick pay,
compensation for shift differential and any other contributions made on
behalf of the Participant for the Plan Year which are not currently
includible in gross income by reason of the application of Sections 125,
402(e)(3), 402(h)(1)(B) or 403(b) of the Code (relating to cafeteria
plans, cash or deferred arrangements, salary reduction-type simplified
employee pensions, and tax deferred annuities, respectively), but
excluding bonuses, overtime pay, commissions, incentive compensation,
stock options, stock appreciation rights, imputed income and contributions
to other employee pensions and welfare benefit plans or other similar
remuneration; however, Base Compensation taken into account for purposes
of this Plan shall be limited to $150,000 or such greater amount as may be
provided in accordance with Treasury Regulations.
2.8 Beneficiary shall mean any person or persons, estate or trust designated
by a Participant to receive his accounts if the Participant dies before
his accounts have been distributed to him. Any designation of a
Beneficiary is, however, subject to the rights of a Surviving Spouse under
paragraph 9.7 and the rights of an Alternate Payee under paragraph 14.4.
2.9 Board shall mean the Board of Directors of SunTrust Banks, Inc.
2.10 Break In Service shall mean for each Employee or former employee each
twelve consecutive month period beginning on an Employee's Employment
Termination Date or anniversary of such date during which an employee or
former Employee fails to complete an Hour of Service; provided, however,
that an Employee shall not have a Break in Service during any Leave of
Absence.
2.11 Certain Other Participants shall mean any Participant who is eligible to
make Elective Contributions during any portion of the Plan Year and who,
with respect to the Plan Year, is not a Highly Compensated Active
Participant.
2.12 Code means the Internal Revenue Code of 1986, as amended and as it may be
amended in the future, and references thereto shall also include the valid
rules and regulations issued thereunder.
2.13 Company Contribution shall mean the Company contribution made pursuant to
paragraph 4.1 but such term shall not include Matching Contributions.
5
2.14 Company shall mean for any Plan Year (i) the Corporation and (ii) each
Company which is designated by the Corporation as a Company in Exhibit "A"
and (iii) any successor business organization to a Company which is an
Affiliate; provided such Affiliate's participation in this Plan has not
been terminated during or prior to such Plan Year.
2.15 Compensation Committee shall mean the Compensation Committee of the Board
of Directors of SunTrust Banks, Inc.
2.16 Compensation Deferral Agreement shall mean an agreement pursuant to which
the Participant agrees to defer receipt, pursuant to paragraph 4.2 hereof,
of a stipulated percentage of his Base Compensation and the Company agrees
to contribute to the Plan the amount so deferred as an Elective
Contribution.
2.17 Corporation shall mean SunTrust Banks, Inc. or any successor corporation.
2.18 Current Obligations shall mean Trust obligations arising from extension of
credit to the Trust and payable in cash within one (1) year from the date
a Company Contribution or Matching Contribution is due.
2.19 Date of Employment shall mean the first day for which an Employee has an
Hour of Service.
2.20 Disability shall mean a disability as defined under the SunTrust Banks,
Inc. Long-Term Disability Plan.
2.21 Effective Date shall mean the effective date on which the Corporation or a
Company adopts this Plan.
2.22 Elective Contribution shall mean a contribution made on behalf of a
Participant pursuant to paragraph 4.2.
2.23 Eligible Employee shall mean all Employees other than the following:
(a) Employees who are prime time Employees.
(b) Employees who are temporary Employees. A temporary Employee is any
Employee who is hired to work only for a designated time period, which
can be either a single designated time period or occasionally, such as
summer or holiday periods. Additionally, Employees who work on an as
needed basis and who are expected to work less than five
6
hundred (500) hours per year are classified as Temporary Employees.
(c) Employees who are Leased Employees. For purposes of this paragraph, a
"Leased Employee" is any person (other than an Employee of the Company)
who, pursuant to an agreement between the Company and any other firm or
individual ("leasing organization") has performed services for the Company
or for the Company and related persons on a substantially full-time basis
for a period of at least one (1) year and such services are performed
under primary direction or control by the Company. Leased Employees, as
defined herein, shall receive credit for eligibility service for any
period of time they are employed by a leasing organization and are
performing services for the Company unless the Leased Employee is
participating in a qualified pension plan, as defined herein, and Leased
Employees do not constitute more than twenty percent (20%) of the
Company's non-highly compensated work force (as defined in Section 414(n)
of the Code). A "qualified pension plan" is a money purchase pension plan
sponsored by the leasing organization which provides: (i) A non-integrated
employer contribution rate of at least ten percent (10%) of compensation
(as defined in Section 414(n) of the Code), (ii) immediate participation
for each employee of the leasing organization (other than employees who
perform substantially all of their services for the leasing organization),
and (iii) full and immediate vesting; provided, however, that clause (ii)
shall not apply to any individual whose compensation from the leasing
organization in each Plan Year during the four year period ending with the
current Plan Year is less than $1,000.
2.24 Employee shall mean any person employed by a Company including, without
limitation, Employees paid in whole or part on a commission basis.
2.25 ERISA shall mean the Employee Retirement Income Security Act of 1974, as
amended and as it may be amended in the future, and references thereto
shall also include the valid rules and regulations issued thereunder.
2.26 Employer Stock shall mean securities described in Section 4975(e)(8) of
the Code or Treasury Regulation Section 54.4975-12 or any equivalent
provision adopted in the future. In this regard, Employer Stock includes
the following:
7
(a) Any common stock issued by the Corporation or by a corporation which
is a member of a controlled group of corporations that includes the
Corporation provided the common stock is readily tradeable on an
established securities market.
(b) If there is no common stock that meets the requirements of
subparagraph (a) above, Employer Stock shall mean common stock issued
by the Corporation or by a corporation which is a member of a
controlled group of corporations that includes the Corporation if the
common stock has voting power and dividend rights "no less favorable"
(within the meaning of Treasury Department Regulation 1.46-8(g)(3))
than the voting power and dividend rights of other common stock issued
by SunTrust Banks, Inc. or its subsidiaries.
(c) Noncallable preferred stock if such stock is convertible at any time
into such common stock that meets the requirements of subparagraph (a)
or (b), whichever is applicable, and if such conversion is at a
conversion price which, as of the date of the acquisition by the Plan,
is reasonable. Preferred stock shall be treated as noncallable if
after the call there will be a reasonable opportunity for a conversion
to common stock which meets the requirements of the preceding
sentence.
2.27 Employer Stock Suspense Account shall mean the suspense account set up by
the Trustee to hold Employer Stock acquired with the proceeds of an Exempt
Loan prior to release of the Employer Stock for allocation to the
Participants' accounts pursuant to paragraph 7.3.
2.28 Employment shall mean service of an Employee with a Company. Service with
a Company prior to its designation as such shall be deemed to be
Employment for purposes of determining Service under the Plan.
2.29 Employment Termination Date shall mean for each Employee the earlier of
(a) the date such Employee quits, retires, dies or is discharged in
accordance with the personnel policy of the Company or (b) the first
anniversary of an absence from employment for any other reason provided
the Employee has not been reemployed by the Company.
2.30 Entry Date shall mean the first day of each calendar month.
8
2.31 ESOP shall mean an "Employee Stock Ownership Plan" as defined in Section
4975(e)(7) of the Code.
2.32 Exempt Loan shall mean a loan made to the Trust by a disqualified person
or a loan to the Trust which is guaranteed by a disqualified person and
which satisfies the requirements of Section 2550.408b-3 of the Department
of Labor Regulations and Section 54.4975-7(b) of the Treasury Regulations
and paragraph 12.5 hereof.
2.33 Guaranteed Matching Contribution shall mean the Matching Contribution
determined pursuant to paragraph 4.4 that will be made without regard to
the financial performance of the Company.
2.34 Hardship shall mean a condition, the presence of which shall be determined
under regulations established by the Plan Committee, taking into account
wherever applicable the definition of such term by the Treasury Department
in its regulations issued under Section 401(k) of the Code, all on the
basis of information supplied to such Committee by the Participant.
2.35 Highly Compensated Active Participant shall mean any Participant who is an
Employee during the Plan Year and who:
(a) was a five percent (5%) owner, as defined in Section 416(i)(1)(B) of
the Code, at any time during the Plan Year or the preceding Plan Year,
or
(b) received Available Compensation from the Employer in excess of
$80,000, as adjusted pursuant to Section 414(q)(1) of the Code and, if
the Corporation elects, was in the top-paid group of employees, as
defined below, for the preceding Plan Year.
For purposes of this paragraph the term "top-paid group of employees"
means a group of employees consisting of the top twenty percent (20%) of
all employees when ranked on the basis of Available Compensation paid
during such Plan Year. For purposes of determining the "top-paid group of
employees" any employee who (i) has not attained age twenty one (21), (ii)
is part of a unit of employees covered by a collective bargaining
agreement (except to the extent provided in Treasury Regulations) and
(iii) nonresident aliens with no U.S. source income shall be disregarded.
Subsections 414(b), (c), (m), (n) and (o) of the Code shall be applied
9
before the application of this paragraph to define Highly Compensated
Active Participant. Available Compensation as used in this paragraph shall
be computed without regard to the $150,000 limitation which would
otherwise apply pursuant to paragraph 2.6.
2.36 Hours of Service shall mean the following with respect to hourly Employees
(see subparagraph (a) below) and salaried Employees (see subparagraph (b)
below):
(a) Hours of Service for hourly Employees shall mean:
(i) each hour for which an Employee is directly or indirectly paid,
or entitled to payment, by the Company for the performance of
duties. These hours shall be credited for the computation
period in which the duties are performed;
(ii) each hour for which an Employee is directly or indirectly paid,
or entitled to payment, by the Company for reasons other than
for the performance of duties, such as vacation, sickness,
disability, holiday, jury duty, temporary military duty, leave
of absence or layoff; provided, however, that no more than 501
Hours of Service will be credited with respect to any single
continuous period during which the Employee performs no duties
(regardless of whether such continuous period is in a single
computation period) and no Hours of Service shall be credited
if the payment is pursuant to a plan or policy maintained
solely for the purpose of complying with workers' compensation,
unemployment compensation or disability insurance laws or if
the payment reimburses an Employee for medical or medical
related expenses. These hours shall be credited to the Employee
for the computation period or periods during which payment is
actually made or amounts payable to the Employee become due,
whichever is earlier;
(iii) each hour for which back pay, irrespective of mitigation of
damages, has been either awarded or agreed to by the Company;
provided, however, that no more than 501 Hours of Service will
be
10
credited with respect to any single continuous period during
which the Employee did not perform, or would not have
performed, duties. These hours shall be credited to the
Employee for the computation period or periods to which the
award or agreement pertains rather than the computation period
in which the award, agreement or payment is made; and
(iv) each hour which is otherwise required to be credited to an
Employee under Regulation Section 2530.200b-2 issued by the
United States Department of Labor, or any subsequent amendment
thereto, and which has not been credited under subparagraphs
(a)(i), (ii) or (iii) immediately above.
(b) Hours of Service for salaried Employees shall mean service accumulated
as described in subparagraphs (b)(i) and (ii) below:
(i) Each Employee shall be credited with ninety-five (95) Hours of
Service for each semi-monthly payroll period for which he or
she would otherwise be credited with one (1) Hour of Service
under subparagraph (a) as if the salaried Employee were an
hourly Employee.
(ii) An Employee shall be credited with such additional Hours of
Service as are required to be credited under Regulation Section
2530.200b-3(e) issued by the Department of Labor, or any
subsequent amendment thereto, which have not been credited
under subparagraph (b)(i) immediately above.
(iii) In the event that a semi-monthly payroll period for which Hours
of Service are credited pursuant to this paragraph overlaps two
(2) computation periods, all such Hours of Service shall be
credited to the first computation period. No more than
ninety-five (95) Hours of Service shall be credited under
subparagraphs (b)(i) and (ii) immediately above with respect
11
to any semi-monthly payroll period.
(c) If an Employee receives a payment as a result of his or her
Employment during a period of ti me when no duties are performed and
if the payment is calculated on the basis of units of time as
described in Regulation Section 2530.200b-2(b)(1) issued by the United
States Department of Labor, or any subsequent amendment thereto,
additional Hours of Service shall be credited to the Employee equal to
the number of regularly scheduled working hours included in the units
of time on the basis of which the payment is calculated as provided in
Regulation Section 2530.200b-2(b)(1). If an Employee receives a
payment as a result of his or her employment with the Company during a
period of time when no duties are performed and if the payment is not
calculated on the basis of units of time as described in Regulation
Section 2530.200b-2(b)(2) issued by the United States Department of
Labor, or any subsequent amendment thereto, additional Hours of
Service shall be credited to the Employee equal to the amount of the
payment divided by the Employee's most recent rate of compensation (as
determined under Section 2530.200b-2(b)(2)(ii) of said Regulation).
Notwithstanding the above, an Employee shall not be credited with a
number of Hours of Service which is greater than the number of hours
the Employee is regularly scheduled to perform during said period as
determined by the Committee in accordance with Section
2530.200b-2(b)(3) of said Regulation.
(d) For purposes of this paragraph, the following terms shall be defined
as indicated:
(i) "Salaried Employee" shall mean any common-law employee employed
as a salaried Employee including salaried non-exempt Employees.
(ii) "Salaried non-exempt Employee" shall mean any Employee paid on
a salary basis where the Employee is also entitled to overtime
pay pursuant to the federal wage and hour laws.
(iii) "Hourly Employee" shall mean all other common-law employees
other
12
than those Employees defined as salaried Employees in
subparagraph (f)(i).
2.37 Investment Fund means any fund authorized by the Plan Committee for
investment of assets held in the Trust Fund.
2.38 Key Employee means any Employee or former Employee (or Beneficiary of such
Employee) who, at any time during the Plan Year, or during any of the four
(4) preceding Plan Years:
(a) has Available Compensation in excess of fifty percent (50%) of the
dollar amount prescribed in Section 415(b)(1)(A) of the Code (relating
to defined benefit plans) and is an officer of the Employer;
(b) has Available Compensation in excess of the dollar amount prescribed
in Section 415(c)(1)(A) of the Code (relating to defined contribution
plans) and is one of the Employees owning the ten (10) largest
interests in the Employer;
(c) is a more than five percent (5%) owner of the Employer; or
(d) is a more than one percent (1%) owner of the Employer and has
Available Compensation of more than $150,000.
The constructive ownership rules of Section 318 of the Code (or the
principles of that section, in the case of an unincorporated Employer,)
will apply to determine ownership in the Employer. The number of officers
taken into account under subparagraph (a) will not exceed the greater of
three (3) or ten percent (10%) of the total number (after application of
the exclusions in Section 414(q) of the Code) of Employees, but no more
than fifty (50) officers. The determination of who is a Key Employee will
be determined in accordance with Section 416(i)(1) of the Code and the
Treasury Regulations issued thereunder.
2.39 Leave of Absence shall mean a period during which an Employee:
(a) is on military duty, provided the Employee is legally entitled to
reemployment under the provisions of any federal law pertaining to
employment rights following military duty and applies for
13
reemployment within the time provided by such law and in the manner
and under the conditions prescribed by such law, or
(b) is absent for reasons authorized in writing under the standard
personnel practices of the Affiliate by which he or she is then
employed.
2.40 Limitation Year shall mean the calendar year used for purposes of applying
the annual addition limitations of Section 415 of the Code as set forth in
Section V.
2.41 Matching Contributions shall mean Company matching contributions pursuant
to paragraph 4.4.
2.42 Matching Contribution Percentage with respect to a Plan Year shall mean
the average of the ratios, calculated for all Highly Compensated Active
Participants as a group and for all Certain Other Participants as a
separate group, of (a) the amount of the Matching Contributions made on
behalf of each Participant in the group for the applicable Plan Year, to
(b) the Participant's Available Compensation received while an eligible
Participant during the applicable Plan Year. The ratio for Highly
Compensated Active Participants shall be determined with respect to the
current Plan Year, but the ratio for Certain other Participants shall be
determined with respect to the immediately preceding Plan Year, unless the
Corporation files an election to use the ratios for the current Plan year.
The ratio for each Participant within a group shall be calculated
separately prior to averaging all ratios for all Participants within a
group. For purposes of this paragraph, the ratio for any Highly
Compensated Active Participant who is eligible to receive Matching
Contributions during a Plan Year or to make nondeductible employee
contributions for a Plan Year under two or more plans described in Section
401(a) of the Code that are maintained by the Company or an Affiliate
shall be determined as if all such contributions were made under a single
plan. If multiple plans are aggregated for purposes of Section 410(b) of
the Code, the provisions of paragraph 5.12 shall apply. The Plan will take
into account the actual Matching Contribution ratios of all eligible
Employees for purposes of the Matching Contribution Percentage test under
paragraph 5.3 and Section 401(m) of the Code. For this purpose, an
eligible Employee is any Employee who is directly or indirectly eligible
to receive an allocation of Matching Contributions or to make Elective
Contributions and includes the following:
14
(a) an Employee who would be a Plan Participant but for the
failure to make required contributions;
(b) an Employee whose right to make Elective
Contributions or receive Matching Contributions has been
suspended because of an election (other than certain one-time
elections) not to participate, or due to a hardship
distribution; and
(c) an Employee who cannot make an Elective Contribution
or receive a Matching Contribution due to annual additions
limitations under paragraphs 5.8 or 5.10 and Section 415of the
Code.
In the case of an eligible Employee who makes no Elective
Contributions and who receives no Matching Contributions, the
Matching Contribution ratio that is to be included in determining
the Matching Contribution Percentage is zero. If the Plan calculates
the Matching Contribution Percentaqge for the 1997 Plan Year using
the ratio for Certain Other Participants from the 1996 Plan Year,
for purposes of determining the group of Certain Other Participants,
the Plan shall use the Plan definition of Highly Compensated Active
Participants in force on December 31, 1996.
2.43 Participant shall mean an Employee who is or becomes eligible to
participate in the Plan in accordance with Section III of the Plan.
2.44 Performance Matching Contribution shall mean the Matching Contribution
determined pursuant to paragraph 4.4 that is made only if the Company
attains certain financial performance targets.
2.45 Plan shall mean the SunTrust Banks, Inc. 401(k) Plan, a defined
contribution plan consisting of a profit sharing plan with a cash or
deferred arrangement and a stock bonus plan with employee stock ownership
features. The primary purpose of the plan is to invest in qualifying
employer securities and the plan is intended to qualify under Sections
401(a), 401(k), 409(d) as to assets from Prior PAYSOPs, 409(e), (h) and
(o) and 4975(e)(7) of the Code.
2.46 Plan Year shall mean the calendar year.
2.47 Plan Committee shall mean the committee appointed by the Board in
accordance with Section XI of the Plan.
15
2.48 Prior PAYSOP shall mean the Sun Banks, Inc. Employee Stock Ownership Plan
and the Trust Company of Georgia Tax-Credit Employee Stock Ownership Plan
and this term shall also include the provisions of the Third National
Corporation Thrift Plan that govern contributions to a payroll-based
employee stock ownership plan that entitled the company to an income tax
credit under Section 41 of the Code.
2.49 Prior Plan shall mean the Sun Banks, Inc. SunShare Plan (Second Amendment
and Restatement as of January 1, 1987), the Third National Corporation
Thrift Plan or the Trust Company of Georgia Incentive Compensation Plan
and Trust Agreement (As Amended and Restated Effective January 1, 1987).
2.50 Qualified Participant shall mean any Participant who has reached the date
which is the first day of the month in which the Participant attains age
fifty-five (55).
2.51 Retirement shall mean an Employee's termination of Employment with the
Company and all Affiliates after the date the Participant reaches his
fifty-fifth (55th) birthday.
2.52 Service shall mean for each Employee, his or her total number of full
years of employment and any fractional year (expressed in full months) of
employment as an Employee completed in each period of employment as an
Employee. A period of employment commences on an Employee's Date of
Employment or reemployment date and ends on his or her first Employment
Termination Date following such Date of Employment or reemployment date
which coincides with the first day of a Break in Service. An Employee's
total Service shall be determined in accordance with the following rules:
(a) Period of Separation Less than 12 months. Service shall include any
period of separation due to absence or termination of employment of
less than 12 consecutive months without regard to length of Service
prior to the period of such separation.
(b) Credit for Month. An Employee shall receive credit for a full month
of Service for each calendar month in which he or she is credited
with at least one (1) Hour of Service during such calendar month.
(c) Aggregation Rules. If an Employee completes more than one period of
16
employment, his or her period of Service completed in each period of
employment shall be aggregated and the number of calendar months of
Service in excess of a full year in each period of employment shall
be aggregated into years on the basis that 12 calendar months equal
one year.
(d) Leave of Absence. An Employee shall be given credit for Service
during a Leave of Absence; provided, that, for Plan Years beginning
on or after January 1, 1989, the Service credit for any Leave of
Absence shall not exceed one year unless the Leave of Absence is an
approved medical leave or such service credit is otherwise required
under applicable law.
(e) Service Credit for Previous Employment. An Employee shall not receive
Service credit under this Plan for any period of employment completed
before he or she first becomes an Employee, except that an Employee
shall receive credit for all periods of previous employment (1)
required to be credited to such Employee under Sections 411 or 414 of
the Code and (2) Employees shall be credited for all services
performed for an Affiliate and for all services performed for an
entity that becomes an Affiliate prior to the date the entity becomes
an Affiliate, as if such services had been performed as an Employee.
(f) Special Transition Rules Regarding Crediting Service for
Participation and Vesting Purposes. On and after January 1, 1990 an
Employee shall be credited with Service for participation purposes
consisting of the sum of: (i) the number of Years of Eligibility
Service credited to the Employee as of the end of the applicable
twelve (12) month eligibility computation period for the Employee
which ends prior to January 1, 1990 (the "1989 Eligibility
Computation Period"), as determined pursuant to the terms of the Plan
as in effect on December 31, 1989, plus (ii) the greater of (A) the
period of Service that would be credited to the Employee during the
twelve (12) month period (the "1990 Eligibility Computation Period")
that begins immediately following the end of the 1989 Eligibility
Computation Period referenced above, as if the provisions of the Plan
in effect on January 1, 1990 regarding the determination of Service
were in effect during such eligibility computation period or (B) the
number of Years of Eligibility Service
17
credited to the Employee for such 1990 Eligibility Computation Period.
For eligibility purposes, service after the end of the 1990 Eligibility
Computation Period shall be governed by the terms of the Plan as in
effect on January 1, 1990. Employees shall be credited with Service for
vesting purposes as of December 31, 1990 consisting of the sum of: (i)
the number of Years of Vesting Service credited to the Employee as of
December 31, 1989, as defined below; plus (ii) the greater of (A) the
period of Service credited to the Employee for the 1990 Plan Year or
(B) one (1) year of Service if the Employee completes 1,000 "Hours of
Benefit Accrual Service" (as such term was defined in the Plan as of
December 31, 1990) during 1990. For determining Years of Vesting
Service credited to an Employee as of December 31, 1989, each Employee
who is employed by the Company on or after January 1, 1990, shall
receive credit for one (1) Year of Vesting Service for each Plan Year
prior to January 1, 1990 in which such Employee completes an Hour of
Service, as such term is defined under the terms of the Plan as in
effect on January 1, 1990.
(g) Maternity or Paternity Leave. Notwithstanding the provisions of this
paragraph as set forth above if an Employee's absence is attributable
to maternity or paternity leave, an individual's period of severance
will not begin until the second anniversary of the date the
individual is first absent and does not perform an Hour of Service.
The portion of the absence from the first date of absence up to a
maximum of one (1) year will be included in the individual's period
of Service, but any additional absence for maternity or paternity
leave beyond one (1) year and up through the second one (1) year
period is neither part of the period of Service nor part of the
period of severance in accordance with Section 411(a)(6)(E) of the
Code and Section 1.410(a)-9 of the Treasury Regulations.
2.53 Taxable Wages shall mean all remuneration for services performed for the
Company which is currently includible in gross income in accordance with
the statute and regulations for determining wages subject to federal
income taxes for purposes of computing Form W-2.
2.54 Top-Heavy Determination Date shall mean the last day of the preceding Plan
Year.
18
2.55 Top-Heavy Plan shall mean any defined contribution plan that is a
Top-Heavy Plan as defined in paragraph 10.1.
2.56 Total Account shall mean the value of a Participant's Company Contribution
account, Elective Contribution account, Matching Contribution account,
Prior Plan elective contribution account, Pre 1987 Voluntary Contribution
account, Post 1986 Voluntary Contribution account, PAYSOP account, Prior
Plan Company Contribution account and Participant rollover account as of
any Valuation Date.
2.57 Trust Agreement shall mean the instrument executed by the Corporation and
the Trustee, as amended from time to time, fixing the rights and
responsibilities of each party with respect to the holding, investment and
administration of the Trust Fund.
2.58 Trust Fund shall mean the Employer Stock and other property held by the
Trustee for the purposes of the Plan.
2.59 Trustee shall mean the person, corporation, association or a combination
of them, or their successors, who shall accept the appointment of the Plan
Committee to execute the duties of Trustee as stated in the Trust
Agreement.
2.60 Valuation Date prior to July 1, 1997, shall mean the last business day of
each calendar month. On and after July 1, 1997, Valuation Date shall mean
any business day that the United States financial markets are open for
business.
2.61 Vested Account shall mean the nonforfeitable value of a Participant's
account as of any Valuation Date as determined pursuant to Article VI of
this Plan.
2.62 Voluntary Contributions shall mean after-tax Employee contributions to a
Prior Plan. Additional Voluntary Contributions shall not be allowed
hereunder.
SECTION III - ELIGIBILITY AND PARTICIPATION
-------------------------------------------
3.1 Participation. Each Employee who was a Participant in the Plan immediately
prior to January 1, 1993 shall remain a Participant in this Plan as of
January 1, 1993, provided he is an Eligible Employee. Every other Employee
who is an Eligible Employee shall be eligible to participate in the Plan
as of the first Entry Date next following the date the Eligible Employee
19
completes at least one (1) year of Service, provided the Eligible Employee
is still in the employ of the Company on that Entry Date and attains age
twenty-one (21) no later than the last day of the month in which the Entry
Date occurs. If such Eligible Employee has not attained age twenty-one
(21), such Employee will be eligible to participate on the Entry Date in
the month in which the Employee attains age twenty-one (21) provided he is
still in the employ of the Company on such Entry Date.
3.2 Participation of Reemployed Individuals. A reemployed ndividual who
previously participated in this Plan, a Prior Plan or a Prior PAYSOP shall
become a Participant as soon as reasonably possible, pursuant to
guidelines adopted by the Plan Committee, following the date he or she is
reemployed by the Company. Any other reemployed individual shall become a
Participant on the date the participation requirements of paragraph 3.1
are satisfied.
3.3 Prior Service of Reemployed Individuals. A reemployed individual shall
receive credit for his or her prior years of Service including prior
Service with an Affiliate both before and after such entity became an
Affiliate.
SECTION IV - CONTRIBUTIONS
--------------------------
4.1 Company Contribution. The Board of Directors of the Corporation, or the
Compensation Committee, shall determine the Company Contribution to be
contributed to the Trust Fund for each of its Participants, provided,
however, that Company Contributions shall never be less than the amount
required to enable the Plan to discharge the Current Obligations after
reducing such Current Obligations by the amount of Performance Matching
Contributions contributed during the Plan Year and designated by the
Company for the repayment of an Exempt Loan. The Corporation and each
Company that makes a contribution pursuant to this paragraph for the
repayment of an Exempt Loan shall inform the Trustee in writing that such
contribution is to be used to repay an Exempt Loan. The Corporation and
each Company hereby agree to contribute cash or Employer Stock to the
Trust Fund during each Plan Year, within the time prescribed by Section
404(a)(6) of the Code, in an amount equal to the amount of the Current
Obligations less the following:
20
(a) The dividends on Employer Stock in the Employer Stock Suspense
Account used during the Plan Year to repay an Exempt Loan.
(b) Any Plan earnings (from cash contributed by the Company during the
Plan Year for repayment of an Exempt Loan) used during the Plan Year
to repay an Exempt Loan.
4.2 Elective Contributions. As of any Entry Date, a Participant may, pursuant
to a Compensation Deferral Agreement, direct the Company to contribute
Elective Contributions from the Participant's Base Compensation to the
Participant's Elective Contribution subaccount in an amount of 2%, 3%, 4%,
5%, 6% 7%, 8%, 9% or 10% of the amount of Base Compensation paid during
the pay period provided that the aggregate Elective Contribution for any
Participant for any calendar year may not exceed Seven Thousand Dollars
($7,000), as adjusted by the Treasury Department pursuant to Section
402(g) of the Code for cost of living changes. Notwithstanding the
provisions of the prior sentence, during any Plan Year, and as often as
deemed necessary, the Plan Committee may (a) limit the percentage of Base
Compensation that a Highly Compensated Active Participant may defer to any
rate less than 10% of his Base Compensation, (b) limit the percentage of
Base Compensation deferred by all Highly Compensated Active Participants
who earn in excess of an amount of Base compensation selected by the Plan
Committee, (c) for future pay periods may limit the maximum dollar amount
that a Highly Compensated Active Participant may defer during a Plan Year
or (d) a combination of the methods set forth above, if the Plan Committee
determines that such action may be necessary to satisfy either of the
tests set forth in paragraph 5.1. After having made such a limitation
regarding Highly Compensated Active Participants, the Plan Committee may
later raise the then permitted percentage of Base Compensation or dollar
amount contributed as Elective Contributions on behalf of Highly
Compensated Active Participants if the Plan Committee determines that the
earlier reduction in the maximum contribution rate or dollar amount for
Highly Compensated Active Participants was not necessary to satisfy either
of the tests set forth in paragraph 5.1. Elective Contributions shall be
made on a payroll deduction basis each pay period.
4.3 Changes to Contribution Rate. If a Participant is eligible to make
Elective Contributions during a Plan Year, he or she may file two (2)
Compensation Deferral Agreements during such Plan Year in which the
21
Participant may elect to increase or decrease the percentage of Base
Compensation that is being deferred to a whole percentage allowed pursuant
to paragraph 4.2. The new election shall become effective on the first day
of the month following the month in which the election is received by the
Plan Committee. An initial deferral election made at the beginning of a
Plan Year counts as one (1) of the two (2) elections allowed during a Plan
Year. Deferral rates for Elective Contributions in force at the end of a
Plan Year for each Participant shall carryover and remain in force at the
same percentage rate for the next Plan Year unless the Participant files a
new Compensation Deferral Agreement. Regardless of the number of deferral
elections filed in a Plan Year, a Participant may direct the Company to
discontinue making Elective Contributions at any time by giving written
notice to the Plan Committee of such suspension on a form provided by the
Plan Committee, or in such other manner as may be authorized by the Plan
Committee, prior to the beginning of the month for which the suspension is
to become effective. Notwithstanding the prior provisions of this
paragraph if a Participant discontinues Elective Contributions during a
Plan Year, the Participant may change the rate of or resume Elective
Contributions only as of the following January 1 or any Entry Date
thereafter by giving notice to the Plan Committee on a form provided by
the Plan Committee, or in such other manner as may be authorized by the
Plan Committee, prior to the beginning of the month that Elective
Contributions are to resume. If a Participant has not deferred Elective
Contributions during a Plan Year, the Participant may direct the Company
to contribute Elective Contributions from the Participant's Base
Compensation as of any Entry Date by giving notice to the Plan Committee
on a form provided by the Plan Committee, or in such other manner as may
be authorized by the Plan Committee, prior to the beginning of the month
that includes such Entry Date.
4.4 Matching Contributions. The Company may, at its discretion, make a
Matching Contribution to each Participant's Matching Contribution
subaccount for each Participant who made Elective Contributions during the
Plan Year. The Board or the Compensation Committee prior to the beginning
of each Plan Year shall determine the percentage of Elective Contributions
that will be contributed by the Company as Matching Contributions for the
Plan Year and such determination shall be communicated to each Participant
prior to the beginning of each Plan Year. The Board or the Compensation
22
Committee may set a Guaranteed Matching Contribution and/or a Performance
Matching Contribution. Any Performance Matching Contribution shall be
allocated only to the Matching Contribution subaccounts of Active
Participants who made Elective Contributions during the Plan Year and such
allocation shall be calculated on a semi-monthly basis based upon the
actual Elective Contributions contributed in each semi-monthly payroll
period of the Plan Year even though the Performance Matching Contribution
may not be contributed until after the end of the year. If the Board or
the Compensation Committee does not set a Matching Contribution schedule
prior to any Plan Year, the Company shall contribute a Guaranteed Matching
Contribution for such Plan Year only for Elective Contributions up to two
percent (2%) of the Participant's Base Compensation and such Matching
Contributions shall be equal to fifty percent (50%) of such eligible
Elective Contributions deferred by the Participant and such allocation
shall be calculated on a semi-monthly basis based upon the actual Elective
Contributions contributed in each semi-monthly payroll period of the Plan
Year even though the Guaranteed Matching Contribution may be contributed
at such intervals as determined by the Corporation.
4.5 Minimum Contribution. For each Plan Year in which the Plan is determined
to be a Top-Heavy Plan, the Company Contributions and forfeitures
allocated to the account or accounts of any non-Key Employee under this
Plan shall be equal to at least three percent (3%) of that Participant's
Taxable Wages during that Plan Year. Notwithstanding any other provisions
of this paragraph, if the Company Contributions, Elective Contributions
and Matching Contributions and forfeitures allocated to the account or
accounts of all Key Employees under this Plan are less than three percent
(3%) of his Taxable Wages, the minimum percentage of Taxable Wages that
must be contributed by the Company for any non-Key Employee for a Plan
Year shall be the largest percentage of Taxable Wages contributed on
behalf of any Key Employee under this Plan for the Plan Year. In the case
of any non-Key Employee who is a Participant in this Plan and a
participant in any defined benefit plan of the Company, the foregoing
provisions of this paragraph shall be applied with five percent (5%)
substituted for three percent (3%) unless each non-Key Employee eligible
to participate in this Plan accrues that minimum accrued benefit required
for top-heavy defined benefit plans under the defined benefit plan of the
Company, in which event the non-Key Employee will not receive a minimum
23
benefit under this Plan. If the Company is required to make a minimum
contribution to a defined contribution plan, then such minimum
contribution shall be provided under this Plan in accordance with Section
416 of the Code and the applicable regulations thereunder. For purposes of
this paragraph, the term non-Key Employee shall include all Participants
still employed on the last day of the Plan Year.
4.6 Delivery of Contributions To Trustee. Company Contributions used for the
repayment of an Exempt Loan may be contributed at any time during the Plan
Year but must be remitted no later than sixty (60) days following the end
of the Plan Year, but shall be deemed to have been made as of the last day
of the Plan Year for which the contribution was made.
4.7 Separate Accounts and Non-Diversion of Funds. The Plan Committee shall
maintain an individual account for each Participant, former Participant
and for each Beneficiary having an interest in the Trust Fund. Upon
receipt of contributions, the Trustee will deal with the funds so received
in accordance with the provisions of this Plan. Except as provided in
paragraphs 4.8 and 5.10, no part of the Trust Fund shall be used for, or
directed to, any other purpose than to benefit Employees and their
Beneficiaries nor shall any part thereof be otherwise recoverable by the
Company.
4.8 Return of Company Contributions. No assets of the Trust Fund shall at any
time revert nor be repaid to the Corporation, except that:
(a) If, due to a mistake of fact, made in good faith, the Company makes a
contribution (1) that otherwise would not have been made, or (2)which
is of a greater amount than the amount that otherwise would have been
contributed, such contribution or excess amount may be repaid by the
Trustee to the Company at the Company's option provided that such
repayment is made within twelve (12) months from the date that the
Company paid the contribution to the Trust; or
(b) If a contribution (or portion thereof) made by the Company is
disallowed as a deduction to the Company for federal income tax
purposes, the amount of such contribution (or portion thereof) may be
repaid by the Trustee to the Company at the Company's option provided
that such repayment is made within twelve (12) months after the
disallowance of the deduction has occurred.
24
If the Internal Revenue Service shall determine that the Plan as
applied to a corporation or business organization which has adopted
the Plan is not qualified under Code Section 401(a) all contributions
shall, upon request, be returned within one year after the denial of
initial qualification. In making repayment under this paragraph, only
the amount of the contribution (or portion thereof) involved may be
repaid, and no earnings attributable thereto may be included in such
repayment. In the event there have been net investment losses that
are attributable to such amount, the amount payable will be adjusted
to reflect its proportional share of any such net investment losses.
4.9 Model Amendment for USERRA Service and Benefits Credit. Notwithstanding
any provision of this Plan to the contrary,l on and after December 12,
1994 contributions, benefits and service credit with respect to qualified
military service will be provided in accordance with Code Section 4`4(u).
Loan repayments will be suspended under this Plan as permitted under
Section 414(u) (4).
SECTION V - MAXIMUM CONTRIBUTIONS
---------------------------------
5.1 Limitations on Elective Contributions. Subject to the provisions of
paragraph 5.5 the Actual Deferral Percentage ("ADP") for Highly
Compensated Active Participants for any Plan Year shall not exceed the
greater of (a) or (b) below subject to the provisions of paragraph 5.5:
(a) 125% of the Actual Deferral Percentage of Certain Other
Participants, or
(b) 200% of the Actual Deferral Percentage of Certain Other
Participants, provided, however, that the Actual Deferral Percentage
for the Highly Compensated Active Participants does not exceed the
Actual Deferral Percentage of Certain Other Participants by more
than two (2) percentage points or such lesser amount as the
Secretary of the Treasury shall prescribe to prevent the multiple
use of this alternative limitation with respect to any Highly
Compensated Participant.
25
A Participant who makes Elective Contributions under this Plan during any
calendar year in excess of seven thousand dollars ($7,000), as adjusted by
the Treasury Department pursuant to Section 402(g) of the Code for cost of
living changes, shall be subject to the corrective procedures set forth
under Section 402(g) of the Code and paragraph 5.7.
5.2 Procedure if Elective Contribution Limitation Exceeded. During the Plan
Year the Plan Committee shall monitor and as of the end of the Plan Year
they shall determine whether the Actual Deferral Percentage for the Highly
Compensated Active Participants will satisfy either of the tests contained
25a
in paragraph 5.1. During the Plan Year, the Plan Committee may, at its
discretion, take action pursuant to the provisions of paragraph 4.2 so
that one of the tests set forth in paragraph 5.1 may be satisfied for the
Plan Year. In the event that neither of the tests described in paragraph
5.1 are satisfied by the end of the Plan Year and the Plan fails to
satisfy the multiple use test set forth in paragraph 5.5, any excess
deferrals, as defined below, plus any income allocable thereto, shall be
distributed to the Highly Compensated Active Participants who are
affected, as prescribed below, by the last day of the immediately
succeeding Plan Year. For purposes of this paragraph, "excess deferral"
shall mean, with respect to a Plan Year, the excess of the amount of
Elective Contributions contributed on behalf of the Highly Compensated
Active Participants for such Plan Year over the maximum amount allowed in
order to satisfy either of the tests of paragraph 5.1, subject to the
provisions of paragraph 5.5. The maximum amount allowed is determined by
reducing the Elective Contributions, as set forth below, made on behalf of
one or more of the Highly Compensated Active Participants in order of such
Participants making the largest Elective Contribution by amount and not by
percentage. Income (or loss) allocable to the excess deferrals shall also
be distributed. The income allocable to the excess deferrals shall include
the income (or loss) for the Plan Year in which the excess deferral was
made and the income (or loss) between the end of such Plan Year and the
end of the month prior to the month in which the distribution is made.
Income (or loss) means net income (or net loss). To calculate income or
loss for a Plan Year, the Plan Committee will determine allocable income
or loss in a nondiscriminatory manner which is reasonably comparable to
the manner of determining income and loss to a Participant's account as
described in Section VII of the Plan for each Plan Year or portion of such
Plan Year that such excess deferral remained in the Plan. The excess
deferrals to be distributed to a Participant shall be decreased by the
amount of Elective Contributions distributed to the Participant pursuant
to paragraph 5.7 for the calendar year ending within the Plan Year.
Distributions authorized herein shall be made in the form of a single
payment notwithstanding any provisions herein to the contrary.
5.3 Limitation on Matching Contributions. Subject to the provisions of
paragraph 5.5 the Matching Contribution Percentage ("MCP") for Highly
Compensated Active Participants for any Plan Year shall not exceed the
greater of (a) or (b) below subject to the provisions of paragraph 5.5:
26
(a) 125% of the Matching Contribution Percentage of Certain Other
Participants, or
(b) 200% of the Matching Contribution Percentage of Certain Other
Participants, provided, however, that the Matching Contribution
Percentage for the Highly Compensated Active Participants does not
exceed the Matching Contribution Percentage of Certain Other
Participants by more than two (2) percentage points or such lesser
amount as the Secretary of the Treasury shall prescribe to prevent
the multiple use of this alternative limitation with respect to any
Highly Compensated Active Participant.
5.4 Procedure if Matching Contribution Limitation Exceeded. The Plan Committee
shall determine as of the end of the Plan Year whether the Matching
Contribution Percentage for the Highly Compensated Active Participants
will satisfy either of the tests contained in paragraph 5.3. In the event
that neither of the tests described in paragraph 5.3 are satisfied and the
Plan fails to satisfy the multiple use test set forth in paragraph 5.5,
any excess contributions, as defined below, plus any income allocable
thereto, shall be distributed to the Highly Compensated Active
Participants who are affected, as prescribed below, by the last day of the
immediately succeeding Plan Year. For purposes of this paragraph "excess
contributions" shall mean, with respect to a Plan Year, the excess of the
amount of Matching Contributions contributed on behalf of the Highly
Compensated Active Participants over the maximum amount allowed in order
to satisfy either of the tests of paragraph 5.3, subject to the provisions
of paragraph 5.5. The maximum amount allowed is determined by reducing the
Matching Contributions made on behalf of one or more of the Highly
Compensated Active Participants in order of such Participants whose
accounts have received the largest amount of Matching Contributions and
not by percentages. Income (or loss) allocable to the excess contributions
shall also be distributed. The income allocable to the excess
contributions shall include the income (or loss) for the Plan Year in
which the excess contribution was made and the income (or loss) between
the end of such Plan Year and the date of distribution. Income (or loss)
means net income (or net loss). To calculate income or loss for a Plan
27
Year, the Plan Committee will determine allocable income or loss in a
nondiscriminatory manner which is reasonably comparable to the manner of
determining income and loss to a Participant's account as described in
Section VII of the Plan for each Plan Year or portion of such Plan Year
that such excess contribution remained in the Plan. Distributions
authorized herein shall be made in the form of a single payment
notwithstanding any provisions herein to the contrary.
5.5 Multiple Use Limitation. For any given Plan Year the Plan Committee may
utilize the test set forth in subparagraph 5.1(b) or the test in
subparagraph 5.3(b) in satisfying the requirements of those paragraphs,
but the Plan Committee may not utilize both of the tests set forth in
subparagraph 5.1(b) and subparagraph 5.3(b) to meet the requirements of
paragraphs 5.1 and 5.3 except as may be allowed under the multiple use
test set forth below as applied to separate plans (as defined pursuant to
Treasury Regulation Section 1.401(k)-1(g)(11) for multiple arrangements
under one plan) pursuant to Treasury Regulation Section 1.401(m)-2(b) for
employee stock ownership plan contributions and for non-employee stock
ownership plan contributions. The Plan Committee may utilize different
tests in succeeding years. If at least one Highly Compensated Active
Participant is includible in the ADP test under paragraph 5.1 and in the
MCP test under paragraph 5.3, the sum of all of the Highly Compensated
Active Participant's ADP and MCP may not exceed the multiple use
limitation. The multiple use limitation is the sum of (a) and (b) below:
(a) 125% of the greater of (i) the ADP of all Certain Other
Participants; or (ii) the MCP of all Certain Other Participants for
the Plan Year.
(b) 2% plus the lesser of (a)(i) or (a)(ii), but no more than twice the
lesser of (a)(i) or (a)(ii).
The Plan Committee, in lieu of determining the multiple use limitation as
the sum of (a) and (b), may elect to determine the multiple use limitation
as the sum of (c) and (d):
(c) 125% of the lesser of (i) the ADP of all Certain Other Participants;
or (ii) the MCP of all Certain Other Participants for the Plan Year.
(d) 2% plus the greater of (c)(i) or (c)(ii) but not more than twice the
greater of (c)(i) or (c)(ii).
28
The Plan Committee will determine whether the Plan satisfies the multiple
use limitation after applying the ADP test under paragraph 5.1 and the MCP
test under paragraph 5.3. If, after applying the tests of this paragraph,
the Plan Committee determines the Plan has failed to satisfy the multiple
use limitation, the Plan Committee will correct the failure by treating
the excess amount as excess contributions under paragraph 5.2 or as excess
aggregate contributions under paragraph 5.4 as it determines in its sole
discretion. This paragraph does not apply unless, prior to application of
the multiple use limitation, the ADP and the MCP of the Highly Compensated
Active Participants each exceeds 125% of the respective percentages for
the group of Certain Other Participants.
5.6 Limitation on Company Contributions. Company Contributions shall not
discriminate in favor of Highly Compensated Participants pursuant to the
provisions of Section 401(a)(4) of the Code.
5.7 Return of Excess Elective Contributions. If any portion of a Participant's
Elective Contribution is included in his gross income pursuant to Section
402(g) of the Code (relating to the $7,000 exclusion limitation on
elective deferrals) for any calendar year and not later than the first
March 1 following the end of such calendar year the Participant notifies
the Plan Committee in writing of the amount of the Elective Contribution
that represents an excess deferral, the Plan Committee shall direct the
Trustee to distribute such amount plus any income allocable to such
amount, as determined in accordance with the procedure set forth in
paragraph 5.2 for income on "excess deferrals," in one lump sum to the
Participant not later than the first April 15 following the end of such
calendar year notwithstanding any other provisions of this Plan. Any
return of Elective Contributions pursuant to this paragraph shall not
reduce the Elective Contributions taken into account for purposes of
calculating the Actual Deferral Percentage of any Highly Compensated
Active Participant, but it shall reduce the Elective Contributions taken
into account for such purposes for Certain Other Participants if the
excess Elective Contributions are made to this Plan or any plan of an
Affiliate. The amount to be returned pursuant to this paragraph shall be
reduced by the amount of "excess deferrals" previously distributed,
pursuant to paragraph 5.2, for the Plan Year.
5.8 General Limitations. Subject to the adjustments hereinafter set forth, the
29
maximum aggregate Annual Addition, as defined in paragraph 5.9 to a
Participant's account in any Plan Year shall not exceed the lesser of:
(a) 25% of the Participant's Taxable Wages, or
(b) $30,000 or, if greater, one-fourth of the defined benefit dollar
limitation set forth in Section 415(b)(1) of the Code as in effect
for the Limitation Year, or
If no more than one-third of the Company Contributions for a Plan Year
which are deductible under Section 404(a)(9) of the Code are allocated to
Highly Compensated Active Participants, then the following contributions
and forfeitures shall not be treated as Annual Additions which are subject
to the limitations of this paragraph: (i) Company Contributions which are
deductible for the Corporation's fiscal year that ends with or within the
Plan Year and are applied within the time prescribed by law for filing the
Corporation's federal corporate income tax return for such fiscal year,
including extensions, to pay interest on an Exempt Loan, or (ii) the
allocation of forfeitures of Employer Stock acquired with the proceeds of
an Exempt Loan. The limitation described in subparagraph (b) above shall
not apply to (i) any contribution for medical benefits (within the meaning
of Section 419A(f)(2) of the Code) after separation from service which is
otherwise treated as an annual addition, or (ii) any amount otherwise
treated as an annual addition to an individual medical benefit account
under Section 415(1)(2) of the Code.
5.9 Annual Addition. The term "Annual Addition" shall mean the total for the
Plan Year of:
(a) Company Contributions, Elective Contributions and Matching
Contribution except as provided in paragraph 5.8, allocated to the
account of the Participant under this and any other qualified
defined contribution plan of the Company and all Affiliates in which
the Participant participates; provided, however, that if any Company
Contributions and Matching Contributions are used to repay an Exempt
Loan and such amounts are required to be treated as Annual Additions
hereunder, the amount to be treated as an Annual Addition shall be
calculated based upon the value of the Company Contributions and
Matching Contributions required to be treated as Annual Additions
hereunder and not with
30
respect to the value of the Employer Stock released from the
Employer Stock Suspense Account due to repayment of the Exempt Loan.
(b) Forfeitures allocated to the account of the Participant under this
and any other qualified defined contribution plan of the Company and
all Affiliates in which the Participant participates, except as
provided in paragraph 5.8.
(c) Voluntary Contributions made to any other qualified defined
contribution plan of the Company and all Affiliates.
Amounts allocated, after March 31, 1984, to an individual medical account,
as defined in Section 415(l)(1) of the Code, which is part of a defined
benefit or annuity plan maintained by the Company or an Affiliate are
treated as annual additions to a defined contribution plan. Also, amounts
derived from contributions paid or accrued after December 31, 1985, in
taxable years ending after such date, which are attributable to
post-retirement medical benefits allocated to the separate account of a
Participant who at any time during the Plan Year or any preceding Plan
Year was a Key Employee in a welfare benefit fund, as defined in Section
419(e) of the Code, maintained by the Company or an Affiliate, are treated
as annual additions to a defined contribution plan.
5.10 Limitation for Combination of Plans. In the case of a Participant who
participates in this Plan and a qualified defined benefit plan, the sum of
the defined benefit plan fraction and the defined contribution plan
fraction in any Plan Year shall not exceed 1.0. For purposes of applying
the limitation of this paragraph 5.10, the following rules shall apply:
(a) The defined benefit plan fraction for such Plan Year is a fraction:
(i) the numerator of which is the projected annual benefit of the
Participant under the defined benefit plan (determined as of
the close of the Plan Year), and
(ii) the denominator of which is the lesser of the following:
(aa) the product of 1.25, multiplied by the dollar limitation
in effect under Section 415(b)(1)(A) of the Code for
such Plan Year, or
31
(bb) the product of 1.4, multiplied by the amount which may
be taken into account under the percentage limitation of
Section 415(b)(1)(B) of the Code with respect to such
individual for such Plan Year.
(b) The defined contribution plan fraction for such Plan Year is a
fraction:
(i) the numerator of which is the sum of the total annual additions
(as defined in Section 415(c)(2) of the Code) to the
Participant's account(s) under the defined contribution plan(s)
as of the close of the Plan Year, and
(ii) the denominator of which is the sum of the lesser of the
following amounts for such Plan Year and for each prior year of
service with a Company:
(aa) the product of 1.25, multiplied by the dollar limitation
in effect under Section 415(c)(1)(A) of the Code for
such Plan Year (determined without regard to Section
415(c)(6)), or
(bb) the product of 1.4, multiplied by the amount which may
be taken into account under the percentage limitation of
Section 415(b)(1)(B) of the Code with respect to such
individual for such Plan Year.
If such sum exceeds 1.0, then the benefits from the defined benefit plan
will be limited to such amounts as will reduce such sum to 1.0. If such
sum still exceeds 1.0 after limiting the benefits under the defined
benefit plan, then the Participant's Annual Additions under this Plan
shall be limited to such amounts as will reduce such sum to 1.0. For each
Plan Year in which the Plan is a Top-Heavy Plan, this paragraph shall be
subject to the provisions of paragraph 10.5.
5.11 Preclusion of Excess Annual Additions. In the event the limitations of
paragraphs 5.8 or 5.10 are exceeded with respect to any Participant who
participates in this Plan and any other qualified plan, the Annual
Additions to, or benefits under, such other plan shall be adjusted prior
to making any adjustment to this Plan. If it becomes necessary to make an
adjustment in Annual Additions to a Participant's account under this Plan,
either because of the limitations as applied to this Plan alone or as
applied to this Plan in combination with another plan, then the following
rules shall apply:
32
(a) The excess Annual Additions shall not be deemed Annual Additions in
that Plan Year if such excess amounts meet the requirements of
Treasury Regulation Section 1.415-6(ii) and (iv), as amended and
described herein. If excess Annual Additions occur as a result of
the allocation of Forfeitures, a reasonable error in estimating a
Participant's annual Compensation, a reasonable error in determining
the amount of Elective Contributions allowable under the limits of
Code Section 415, or under other circumstances the IRS finds justify
the availability of these rules, the following actions shall be
taken:
(i) Within one year following the Plan Year in which the excess
Annual Additions occurred, the Plan Committee will first return
any Elective Contributions to the Participant simultaneously
with gains attributable to such Elective Contributions to the
extent the distribution would reduce the excess amounts.
Distribution of Elective Contributions will automatically
result in the reduction of a Participant's allocation of
Matching Contribution. The adjustment to the Matching
Contribution will be held in suspense and used to reduce future
allocations of Matching Contributions for all Participants. The
distributed Elective Contributions are disregarded for purposes
of Code Section 402(g), the Actual Deferral Percentage test and
the Matching Contribution Percentage test. However, the Plan
Committee will follow Revenue Procedure 92-93, as modified,
concerning the proper reporting of a return of employee
contributions or distributions of gains and/or elective
deferrals.
(ii) If excess Annual Additions still exist in a Participant's
account at the end of the Plan Year, the Plan Committee will
first reduce the Participant's allocation of Company
Contributions and then, if necessary, Matching Contributions.
Such excess amounts shall be reallocated as follows:
33
(aa) If the Plan covers the Participant at the end of the
Plan Year, the Plan Committee will use the excess Annual
Additions reduced above to reduce Future Allocations (in
the order provided above) for the Participant under the
Plan for the next Plan Year and for each succeeding Plan
Year, as is necessary.
(bb) If the Plan does not cover the Participant at the end of
the Plan Year, the Plan Committee will hold the excess
amounts unallocated in separate suspense accounts
categorized as described above and apply each suspense
account to reduce Future Allocations (in the order
provided above) for all remaining Participants in the
next Plan Year, and in each succeeding Plan Year, if
necessary. Neither the Employer nor any Employee may
contribute additional amounts to the Plan for any Plan
Year once it is determined the Plan will be unable to
allocate fully a suspense account maintained pursuant to
this subparagraph.
(b) If the excess Annual Additions with respect to a Participant for a
Plan Year do not result from the reasons set forth in (a) above, the
excess amounts shall be deemed Annual Additions. In that event, the
Plan Committee will dispose of such excess amounts in accordance
with the provisions of subparagraph 5.11(a)(ii)(bb). The order by
which contributions will be reduced and held in suspense is as
follows:
(i) Company Contributions
(ii) Matching Contributions
5.12 Treatment of Similar Plans. The limitations of this Section V shall apply
as if the total benefit payable under all qualified defined benefit plans
maintained by a Company or an Affiliate were payable from one plan and as
if the total Annual Additions made to all qualified defined contribution
plans maintained by a Company or an Affiliate were made to one plan.
34
SECTION VI - VESTING AND FORFEITURES
------------------------------------
6.1 Vested Account. On and after January 1, 1997, a Participant, including
former employees who have accounts in the Plan, shall be fully vested in
all accounts in the Plan.
6.2 Amendments to Vesting Schedule. A Participant's vested interest in his or
her Company Contribution account shall not be reduced as the result of any
direct or indirect amendment to this Article VI. In the event that this
Plan is amended to change or modify the applicable vesting schedule, a
Participant with at least three (3) years of Service as of the expiration
date of the election period may elect to be subject to the vesting
schedule in effect prior to the amendment unless the new vesting schedule
is more favorable to the Participant in every respect. If a Participant
fails to make such election, then the Participant shall be subject to the
new vesting schedule. The Participant's election period shall commence on
the date of the amendment and shall end sixty (60) days after the latest
of:
(a) the date the amendment is adopted;
(b) the effective date of the amendment; or
(c) the date the Participant receives written notice of the amendment
from the Company.
6.3 Forfeiture Reinstatement. If a Participant terminates service with the
Company prior to January 1, 1997, the non-vested portion of the
Participant's Company Contribution account shall be forfeited in
accordance with subparagraph (a) below, if applicable, or subparagraph (b)
if (a) is not applicable.
(a) Cash Out and Buy Back Rule:
(i) If the Participant upon termination of employment receives the
entire vested balance in all accounts derived from Company
contributions no later than the last day of the second Plan
Year following the Plan Year in which the termination occurs,
the non-vested portion of the Participant's Company
Contribution account shall be forfeited as of the date of
distribution. If the terminated Participant has no vested
interest in any account derived from Company contributions,
then for purposes of this paragraph he shall be deemed to have
received a cash out distribution of his entire vested balance
in such accounts as of the Valuation Date at the end of the
second month following the month in which the Participant
terminated employment and he shall forfeit his entire interest
in such account as of such date.
35
(ii) If a Participant receives a distribution pursuant to this
subparagraph (a) and resumes service as an Employee, the
Participant's Company Contribution account will be restored to
the value of the account balance on the date of the
distribution if the Participant repays to the Plan the amount
of the distribution from such account before the earlier of
five (5) years after the date on which the Participant resumes
service as an Employee, or the date the Participant incurs,
after such termination, five (5) consecutive Breaks in Service.
This subparagraph (a)(ii) shall apply only if the Participant
forfeited a portion of his Company Contribution account at the
time of the prior distribution. If such rehired Participant was
deemed to have received a distribution pursuant to the last
sentence of subparagraph (a)(i) when he last terminated
employment, then the value of the account balance on the date
of the forfeiture shall be restored as of the last day of the
Plan Year in which the Participant is rehired.
(iii) The Company shall make additional Company Contributions in an
amount sufficient to reestablish the forfeitures of an Employee
who is reemployed. Restoration of the account shall occur as of
the date full repayment is made pursuant to subparagraph
(a)(ii) and any additional assets which are required to be
contributed for the restoration of the account must be
contributed no later than the last day of the Plan Year
following the Plan Year in which full repayment occurs.
36
(iv) The repayment by the Employee and restoration of the Company
Contribution account balance shall not be treated as an annual
addition.
(v) Notwithstanding any other provisions of this subparagraph (a),
if a Participant terminated Employment and incurred a Break in
Service prior to January 1, 1985 any forfeiture which occurred
prior to January 1, 1985 as a result of his or her termination
of Employment shall not be reestablished.
(b) Delayed Forfeitures:
i) If subparagraph (a) is not applicable and if a distribution is
made prior to January 1, 1997, at a time when a Participant has
a vested right to less than 100 percent of the Company
Contribution account and the Participant has not incurred five
(5) consecutive Breaks in Service prior to January 1, 1997, the
Participant's vested interest on January 1, 1997, shall be
determined as follows:
(aa) A separate subaccount will be established for the
Participant's remaining interest in the Company
Contribution account as of the time of the distribution,
and
(bb) On January 1, 1997, the Participant's vested interest in
the separate subaccount will be equal to an amount ("X")
determined by the following formula: X=P times [AB + (R
times D)]-(R times D). For purposes of applying the
formula, P is the vested percentage on January 1, 1997,
which is 100%, AB is the subaccount balance on January 1,
1997, D is the amount of the distribution, and R is the
ratio of the subaccount balance on January 1, 1997, to the
Company Contribution account balance after distribution.
37
ii) If subparagraph (a) does not apply, and a terminated
Participant incurs five (5) consecutive Breaks in Service prior
to January 1, 1997, the non-vested portion of the Company
Contribution account, as determined pursuant to subparagraph
(b)(i), shall be immediately forfeited pursuant to the
provisions of the Plan at the relevant time.
SECTION VII - ACCOUNTS AND ALLOCATIONS
--------------------------------------
THE PROVISIONS OF SECTION VII SET FORTH BELOW SHALL BE APPLICABLE ON AND AFTER
JULY 1, 1997. THE PROVISIONS OF SECTION VII IN EFFECT ON DECEMBER 31, 1996,
SHALL REMAIN IN EFFECT UNTIL JULY 1, 1997.
7.1 Individual Accounts. The Plan Committee shall establish and maintain
adequate records to disclose the interest in the Trust of each
Participant, former Participant and Beneficiary, which interest shall
be known as the Participant's Total Account. Such records shall be in
the form of individual accounts and each Participant or former
Participant shall have the following accounts and each such account
shall have a subaccount for tracking cash, cost of Employer Stock,
shares of Employer Stock and a separate subaccount for each Investment
Fund in which the account has funds invested, as well as any
other accounts or subaccounts which the Plan Committee establishes:
(a) Company Contribution account
(i) Company Contribution purchased subaccount (for Employer
Stock contributed by a Company or purchased by the Trustee
with cash contributed by the Company as a Matching
Contribution or other Company contribution, but it shall
not include stock purchased with the proceeds of an Exempt
Loan, and related cash and costs)
(ii) Company Contribution Exempt Loan subaccount (for Employer
Stock acquired with the proceeds of an Exempt Loan and
related cash and costs)
38
(iii) Company Contributionfund subaccount (for Matching
Contributions and other Company Contributions not required
to be invested in Employer Stock)
(b) Voluntary Contribution account (which account for all Voluntary
Contributions but shall separately record contributions made
prior to 1987)
(c) Participant rollover account
(d) Elective Contribution account
The existence of such accounts will not be deemed to give any person
any right, title or interest in any or to any specific assets or
part of the Trust Fund. Upon consolidation of any of the Prior Plans
with this Plan, any account in the Prior Plan that was attributable
to company contributions shall be accounted for hereunder in a
Company Contribution account. Any elective deferral (pre-tax
employee contribution) made to a Prior Plan shall be accounted for
hereunder pursuant to the elective contribution account. Any
voluntary contribution (after-tax employee contribution) to a Prior
Plan shall be accounted for hereunder pursuant to the Voluntary
Contribution account. Any funds held hereunder from a Prior PAYSOP
shall be accounted for on and after July 1, 1997, in the
Participant's Company Contribution account. Any Participant loans
transferred from a Prior Plan or new loans made hereunder shall be
accounted for as an investment of the account or subaccount from
which the funds were borrowed.
7.2 General Accounts. The Trustee shall also establish and maintain for
the Trust an Employer Stock Suspense Account.
7.3 Valuation Date Adjustments and Allocations. On each Valuation Date,
except as specified below, the account of each Participant and
former Participant or Beneficiary shall be adjusted in accordance
with the following provisions in the order set forth below:
(a) The accounts of Participants, former Participants or
Beneficiaries which have incurred a withdrawal of Employer
Stock from any of the accounts set forth in paragraph 7.1 since
the most recent Valuation Date shall be adjusted as follows with
respect to Employer Stock or fractional shares of Employer Stock
which is sold from the account:
39
(i) The sales proceeds from the Employer Stock which was sold
shall be added to the cash subaccount under the account that
incurred the withdrawal.
(ii) Reduce the cost subaccount under the account that incurred
the withdrawal by the cost basis of the Employer Stock which
was sold.
(iii) Reduce the Employer Stock subaccount under the account that
incurred the withdrawal by the number of shares of Employer
Stock that were sold.
(b) Reduce the balances in each cash subaccount by any withdrawals
from that cash subaccount since the most recent Valuation Date.
(c) Any Company Contribution made pursuant to paragraph 4.1 for the
purpose of repaying an Exempt Loan or any Matching Contribution
made pursuant to paragraph 4.4 for the purpose of repaying an
Exempt Loan shall be used by the Trustee for such purpose.
(d) The Elective Contribution account for each Participant shall be
credited with an amount equal to the Elective Contributions made
on behalf of the respective Participant since the most recent
Valuation Date.
(e) With respect to each Plan Year the Companies shall contribute
sufficient cash and/or Employer Stock so that each Active
Participant's Company Contribution purchased subaccount will
receive Matching Contributions in an amount equal to (i) the
percentage of the Participant's Elective Contributions during
the Plan Year that are to be matched pursuant to the Performance
Matching Contribution as determined pursuant to paragraph 4.4
less (ii) the value, as of the last day of the Plan Year, of
the Employer Stock allocated as of such date to the
Participant's Company Contribution Exempt Loan Employer Stock
account pursuant to subparagraph (i) below. With respect to
each month the Companies shall contribute sufficient cash
and/or Employer Stock so that each eligible Participant's
Company Contribution purchased subaccount will receive Matching
Contributions equal to the percentage of the Participant's
Elective Contributions made since the most recent Valuation Date
that are to be matched pursuant to the Guaranteed Matching
Contribution as determined pursuant to paragraph 4.4. The cash
portion of such contribution shall be allocated to the
Participant's Company Contribution purchased Employer Stock
subaccount.
40
(f) If the Company Contribution for all Active Participants, other
than a Company Contribution required to repay an Exempt Loan,
has been set based upon a percentage of each eligible Active
Participant's Base Compensation, then the Companies shall
contribute sufficient cash and Employer Stock so that the
Company Contribution purchased subaccount of each Active
Participant who has at least 1,000 Hours of Service during
the Plan Year will receive Company Contributions, as described
above, in an amount equal to such percentage times his Base
Compensation after excluding any portion of such Base
Compensation that was earned during a period when he was not a
Participant. The cash portion of such contribution shall be
Participant's investment election and any portion of such
contribution made through Employer Stock shall be allocated to
such Active Participant's Company Contribution purchased Employer
Stock subaccount. If the Company Contribution is not stated as a
set percentage of such Active Participant's Base Compensation or
if the Companies do not make the contribution required to
fund the set percentage for all such Active Participants and the
Trustee is not successful in obtaining the required contribution
from the Companies, the Company Contributions shall be allocated
as set forth in subparagraph 7.3(g) and (h).
(g) Subject to the provisions of subparagraph 7.3(f), Company
Contributions in cash made with respect to a Plan Year that are
not used to make payments on an Exempt Loan shall be allocated to
the Company Contribution purchased Investment Fund subaccounts
of each Active Participant who has at least 1,000 Hours of
Service during such Plan Year in the same proportion that each
such Active Participant's Base Compensation, after excluding
any portion of such Base Compensation that was earned during a
period when he was not a Participant, with respect to such Plan
Year bears to the total of such Base Compensation of all such
Active Participants with respect to such Plan Year.
41
(h) Subject to the provisions of subparagraph 7.3(f), Company
Contributions in Employer Stock contributed by the Corporation
with respect to a Plan Year shall be allocated to the Company
Contribution purchased Employer Stock subaccount of each Active
Participant who has at least 1,000 Hours of Service during such
Plan Year in the same proportion that each such Active
Participant's Base Compensation, after excluding any portion of
such Base Compensation that was earned during a period when he
was not a Participant, with respect to such Plan Year bears to
the total of such Base Compensation of all such Active
Participants with respect to such Plan Year.
(i) If Employer Stock is released from the Employer Stock Suspense
Account pursuant to subparagraph (p) with respect to a Plan Year,
it shall be immediately allocated as set forth below to the
Company Contribution Exempt Loan accounts in the same proportions
respectively as the aggregate Matching Contributions used during
the Plan Year to repay Exempt Loans relates to the aggregate
Company Contribution made pursuant to paragraph 4.1 and used to
repay Exempt Loans. The portion allocated due to use of
Performance Matching Contributions to repay an Exempt Loan shall
be allocated to the Company Contribution Exempt Loan Employer
Stock account of each Active Participant who is eligible to
receive a Matching Contribution pursuant to paragraph 4.4 in
proportion to the total value of Performance Matching
Contributions that should be allocated with respect to such
Active Participant for the Plan Year pursuant to paragraph 4.4 to
the total value of Performance Matching Contributions that should
be allocated to all such Active Participants for such Plan year.
The Employer Stock allocated due to use of other Company
Contributions to repay on Exempt Loan shall be allocated to the
Company Contribution Exempt Loan Employer Stock account of each
Active Participant who has at least 1,000 Hours of Service during
such Plan Year in the same proportion that each such Active
Participant's Base Compensation, after excluding any portion of
such Base Compensation that was earned during a period when he
was not a Participant, bears to the total of such Base
Compensation of all such Active Participants with respect to such
Plan Year.
(j) With the exception of dividends on Employer Stock, allocate the
unrealized gains or losses on all Investment Fund subaccounts
(but excluding any general account under paragraph 7.2) which
have accrued since the most recent Valuation Date to the
respective subaccounts based on the number of units of such
Investment Fund held at the most recent Valuation Date (after all
additions, withdrawals and transfers were completed on the prior
Valuation Date). With the exception of dividends on Employer
Stock, allocate on the Valuation Date it is received the dividend
income received on each Investment Fund subaccount based on the
number of units of such Investment Fund held on the most recent
Valuation Date.
42
(k) Earnings on Company Contributions and Matching Contributions
which were made during the Plan Year and used to repay an Exempt
Loan shall be used to repay the Exempt Loan or, if the loan has
been paid in full, such remaining earnings shall be allocated as
provided in subparagraph 7.3(m).
(l) Allocate as of the date they became available the earnings from
all general accounts under paragraph 7.2, after excluding all
dividends on Employer Stock and earnings on Company Contributions
and Matching Contributions made during the Plan Year and used to
repay an Exempt Loan to the Company Contribution purchased
Investment Fund subaccounts for all Participants based on the
balance in each such subaccount on the most recent Valuation Date
(after all additions, withdrawals and transfers were completed on
such prior date).
(m) Allocate dividend income from Employer Stock, excluding dividend
income from all general accounts under paragraph 7.2, on the date
the dividend is paid to the cash subaccounts based upon the
number of shares of Employer Stock in the corresponding Employer
Stock subaccount on the dividend record date (after all
additions, withdrawals and transfers were completed on the
immediately preceding Valuation Date).
(n) Restore prior forfeitures as required by paragraph 6.3 on the
date the Company transfers assets for the restoration to the
Trust.
(o) The accounts of Participants for whom shares of Employer Stock
have been purchased since the most recent Valuation Date
(excluding all Employer Stock released from the Employer Stock
Suspense Account for the Plan Year) shall be adjusted as follows:
43
(i) Reduce the cash subaccount under the account that purchased
Employer Stock by the total purchase price of the Employer
stock purchased.
(ii) Increase the cost subaccount under the account that
purchased Employer Stock by the total purchase price of the
Employer Stock purchased.
(iii) Increase the Employer Stock subaccount under the account
that purchased the Employer Stock by the number of shares of
Employer Stock purchased.
(p) All Employer Stock acquired by the Plan with the proceeds of an
Exempt Loan must be added to and maintained in the unallocated
Employer Stock Suspense Account. The Trustee shall determine the
number of shares of Employer Stock to be released pursuant to
this subparagraph for each Plan Year. Such Employer Stock shall
be released and withdrawn from that account on the last Valuation
Date of each Plan Year in accordance with Treasury Regulation
Section 54.4975-7(b)(8) and Department of Labor Regulations
Section 2550.408b-3(h) as if all Employer Stock in the Employer
Stock Suspense Account were encumbered. For each Plan Year during
the duration of the loan, the number of shares of Employer Stock
released from the Employer Stock Suspense Account shall equal the
number of encumbered shares held immediately before release for
the current Plan Year multiplied by a fraction which is
determined pursuant to subparagraph (p)(i) or (p)(ii) below as
determined irrevocably by the Plan Committee in writing with
respect to each Exempt Loan within sixty (60) days after an
Exempt Loan is entered into or, if earlier, prior to the date any
payment is made on the loan:
(i) The numerator of the fraction is the amount of principal
and interest paid for the Plan Year and the denominator of
which is the sum of the numerator plus the principal and
interest to be paid for all future Plan Years.
44
(ii) The numerator of the fraction is the amount of principal
paid for the Plan Year and the denominator of which is the
sum of the numerator plus all principal to be paid for all
future Plan Years.
The number of future years under the loan must be definitely
ascertainable and must be determined without taking into
account any possible extensions or renewal periods. If the
Employer Stock in the Employer Stock Suspense Account includes
more than one (1) class of securities, the securities to be
released must be determined by applying the same fraction to
each class. The method of releasing Employer Stock set forth
in subparagraph (r)(ii) above shall apply only for as long as
(1) the Exempt Loan provides for annual payments of principal
and interest at a cumulative rate that is not less rapid at
any time than level annual payments of such amounts for ten
(10) years, (2) the interest included in any payment on an
Exempt Loan is determined to be interest under standard loan
amortization tables, and (3) in the case of a renewal,
extension or refinancing of the Exempt Loan, the expired
duration of such Loan plus the renewal period, the extension
period, or the duration of the new Exempt Loan, as applicable,
does not exceed ten (10) years. In all other events, the
formula for releasing Employer Stock set forth in subparagraph
(r)(i) shall be applicable. If subparagraph (r)(i) is utilized
for releasing Employer Stock and the interest rate is
variable, the interest to be paid in future years must be
computed by using the interest rate applicable at the end of
the Plan Year.
(q) Dividends on Employer Stock in the Employer Stock Suspense
Account and any earnings on such dividends shall be used to repay
the Exempt Loan used to purchase such Employer Stock until the
Exempt Loan is paid in full. Any remaining income in such account
shall be allocated in accordance with the provisions of
subparagraph (l).
(r) Adjust the Investment Fund subaccounts for transfers in and out
of each subaccount pursuant to revised Participant investment
elections or other transfers among such subaccounts.
(s) Cash dividends on Employer Stock allocable to Participants'
Employer Stock subaccounts may be paid to Participants, as
determined in the sole discretion of the Plan Committee, within
ninety (90) days after the close of the Plan Year in which the
dividend is paid.
45
(t) It is not anticipated that after-tax voluntary Employee
contributions will be allowed under this Plan as under the Prior
Plans or Prior PAYSOP, but such amounts contributed by Employees
to the Prior Plans and Prior PAYSOP will be separately accounted
for hereunder.
(u) All loans shall be accounted for as investments of the account or
subaccount from which the funds were borrowed and any gains or
losses from a loan will accrue to the respective account or
subaccount and shall not affect any other subaccount hereunder
notwithstanding any other provisions herein.
7.4 Valuation of Employer Stock Contributions. For Plan allocation purposes,
Employer Stock contributed to the Plan by the Company shall be valued at
the closing price for shares of Employer Stock as reported for the date the
Employer Stock is contributed to the Trustee or, if the stock is not traded
on said date, the Employer Stock shall be valued at the average of the
closing consolidated trading sales prices for the last trading day on which
the stock was traded prior to the date the contribution is made and the
first trading day on which the stock is traded after the date the
contribution is made.
7.5 Allocation Report. As soon as practicable after the last Valuation Date
of each Plan Year, the Plan Committee shall furnish to each Participant a
statement showing the status of his accounts.
7.6 Allocation Corrections. If an error or omission is discovered in any
account, the Plan Committee shall cause an appropriate equitable adjustment
to be made in order to remedy such error or omission as of the Plan Year in
which the error or omission is discovered.
SECTION VIII - INVESTMENT OF DEPOSITS AND CONTRIBUTIONS
-------------------------------------------------------
THE PROVISIONS OF SECTION VIII SET FORTH BELOW SHALL BE APPLICABLE ON AND AFTER
JULY 1, 1997. THE PROVISIONS OF SECTION VIII IN EFFECT ON DECEMBER 31, 1996,
SHALL REMAIN IN EFFECT UNTIL JULY 1, 1997 WITH THE EXCEPTION THAT DURING MAY AND
JUNE, 1997, THE TRUSTEE AND PLAN COMMITTEE WILL CONVERT FROM MONTHLY VALUATIONS
TO DAILY VALUATIONS PURSUANT TO PROCEDURES ADOPTED BY THE PLAN COMMITTEE WHICH
IS HEREBY AUTHORIZED TO VARY INVESTMENT POLICIES AND PRACTICES DURING MAY AND
JUNE, 1997, TO COMPLETE THE CONVERSION.
46
8.1 Investment. Except as provided in paragraphs 8.3, 8.4 and 8.6, all
deposits and contributions under the Plan shall be invested primarily in
Employer Stock and held by the Trustee. A transfer of deposits and
contributions by a Company shall be applied by the Trustee, or its
designated agent, to purchase Employer Stock in accordance with the Trust
Agreement except that for any Plan Year in which the Trustee determines
that a payment may be due on an Exempt Loan, the Trustee shall create a
reserve from Company Contributions made in cash, additional Company
Contributions made for the purpose of repaying the Exempt Loan, cash
dividends on Employer Stock held in the Employer Stock Suspense Account
and earnings on Company Contributions used to repay an Exempt Loan and
such reserve shall not be invested in Employer Stock until such time
as the Trustee determines that the amount in the reserve plus certain
expected quarterly cash dividends on Employer Stock, as defined below, will
be sufficient to make all Exempt Loan repayments (principal and interest)
due for the Plan Year. Thereafter, all Company Contributions shall be
applied to purchase Employer Stock as provided above unless additional
funds are needed later in the Plan Year to increase the reserve fund. For
purposes of determining whether the reserve fund is sufficient to make
the Exempt Loan payments, the Trustee may anticipate the future receipt
of quarterly cash dividends on Employer Stock in the Employer Stock
Suspense Account that should be received by the Trustee during the
balance of the Plan Year assuming (i) SunTrust Banks, Inc. continues to
pay the same quarterly cash dividend of a certain sum per share on
each outstanding share of Employer Stock with respect to all future
quarterly cash dividends as SunTrust Banks, Inc. declared and paid with
respect to its most recent quarterly cash dividend (adjusted for
intervening stock splits or stock dividends or other similar
recapitalizations) and (ii) that future quarterly cash dividends are
paid at the same time as the quarterly cash dividend in the comparable
quarter for the immediately preceding year; provided, however, if
SunTrust Banks, Inc. has made a public announcement that a new certain
sum per share dividend will apply for a future quarterly cash dividend or
that a future quarterly cash dividend will not be paid, the Trustee shall
base the calculation of future quarterly cash dividends on the information
disclosed in the public announcement. If, as of the last day of any month,
the reserve fund exceeds the amount necessary to make payments due on the
Exempt Loan during the Plan Year, the Trustee may transfer amounts
previously contributed as Company Contributions out of the reserve fund if
the Trustee also transfers any earnings attributable to such Company
Contributions out of the reserve fund. The earnings on the excess
Company Contributions shall be determined by multiplying the total
earnings for the Plan Year up to the date of the transfer of the reserve
fund by a fraction, the numerator of which is the amount of Company
Contributions and Matching Contributions that are transferred, and the
denominator of which is the aggregate amount in the reserve fund, excluding
all earnings, immediately prior to the transfer.
47
8.2 Purchase of Employer Stock. Where the Trustee, or its designated agent,
purchases Employer Stock during a day for more than one (1) account and in
such purchases Employer Stock is acquired at different prices, the Plan
Committee shall determine a nondiscriminatory manner of fairly allocating
the Employer Stock to the accounts in accordance with paragraph 7.3.
8.3 Investment Options. After May 30, 1997, any assets in a Participant's
Elective Contribution account which are invested in a common trust fund
shall be transferred to the equivalent Investment Fund. On and after
July 1, 1997, each Participant's Elective Contribution account may be
invested in Employer Stock or one or more of the Investment Funds
authorized by the Plan Committee and changes in investments may be made
pursuant to paragraph 8.4. Participants who first become eligible to
participate on or after July 1, 1997, shall file an investment election
to invest their Elective Contribution account in Employer Stock or any
Investment Fund(s) in increments of one percent (1%) or such other
increments approved by the Plan Committee. If such an election is not
filed, the Participant's Elective Contribution account shall be invested
in an Investment Fund selected by the Plan Committee that primarily
invests in fixed-income investments with shorter average maturities than
other Investment Funds.
48
8.4 Transfer of Investments. On and after July 1, 1997, a Participant may
request a change in the investment of his or her account among Employer
Stock and the Investment Funds on any Valuation Date and in increments of
one percent (1%) or such other increments approved by the Plan Committee
subject to daily notification deadlines and settlement practices
established by the Plan Committee. Purchases and sales of Employer Stock
for any account, subject to the restrictions on such purchases or sales set
forth in this Section VIII, may be initiated on any Valuation Date, subject
to notification deadlines, for settlement as soon as possible subject to
normal market settlement practices. After July 1, 1997, a Participant may
change the investment of future Elective Contributions on any Valuation
Date and such change shall be effective for new Elective Contributions as
soon as reasonably possible, but not to exceed the end of the second pay
period following receipt of the request. New investment elections for
changes in the account or for investment of new contributions may not be
made until settlement of outstanding change elections.
8.5 Special Rules Respecting Stock Elections. Whenever in its discretion the
Plan Committee deems advisable, it may, by written notice, cancel any right
to make additional investments in Employer Stock for a Plan Year until the
Plan Committee is satisfied that any requirements imposed by federal or
state securities laws relative to such Employer Stock election have been
satisfied.
8.6 Election by Qualified Participant. On and after July 1, 1997, each
Qualified Participant shall be permitted, on and after the first day of the
month in which he or she attains age fifty-five, to direct the Plan as to
the investment of all of the shares of Employer Stock allocated to any
account, including Company Contribution accounts held for the Participant.
(a) If a Participant becomes entitled to a distribution hereunder, then
the Participant may require that any assets derived from the
diversification of excess shares be used to purchase Employer Stock
for any distribution made to the Participant. In such a situation, the
provisions of paragraph 9.2 shall govern the purchase of such stock.
8.7 Diversification Options. If a Participant files an election pursuant to
paragraph 8.6 on or after July 1, 1997, the Participant may direct the
Trustee to sell all or part of such Employer Stock and invest the proceeds
in any Investment Fund pursuant to the provisions of paragraph 8.4.
49
SECTION IX - DISTRIBUTIONS, WITHDRAWALS AND LOANS
-------------------------------------------------
9.1 Distributions Upon Disability, Retirement or Termination of Employment.
Subject to the provisions of paragraphs 9.2, 9.3 and 9.9, a Participant's
Total Account will be distributed to him or her in accordance with
paragraph 9.2 upon filing a written election following his or her
Disability or termination of service with the Company and all Affiliates
due to Retirement or any other reason. If a Participant's Employment is
terminated by death, or if he or she dies after termination but before the
complete distribution of the account, his or her account (or the
undistributed balance thereof) will be distributed to the Beneficiary
following receipt of a written election, subject to the provisions of
paragraph 9.10. If a Participant or Beneficiary is entitled to receive
benefits from an account that does not exceed Three Thousand Five Hundred
Dollars ($3,500) in value and the recipient does not file a written
election for benefits within forty-five (45) days of receipt of election
forms, distribution of benefits shall commence in accordance with the Plan
as soon as reasonably possible after the later of (i) fifty (50) days
following delivery of the election forms or (ii) completion of six (6)
semi-monthly payroll periods following the date the participant terminated
employment. If a terminated Participant has already attained age sixty-two
(62) and he or she does not file a written election for benefits within
forty-five (45) days of receipt of election forms or, if later, by March 15
of the year following the year in which the Participant terminated
Employment, distribution of benefits shall commence in accordance with the
Plan as soon as reasonably possible thereafter except as provided in
paragraph 9.7 for distributions of Employer Stock, or as provided in
paragraph 9.2.
9.2 Time of Payment. Any payment called for under this Section IX shall be made
or commenced no later than the time prescribed in this Plan, or if no time
is prescribed and subject to the provisions of paragraph 9.3, as soon as
practicable after occurrence of the event giving rise to the right of
payment, unless where the Participant has died, it is impossible for the
Plan Committee to determine, within such period, the Beneficiary or legal
representative entitled to payment. In such case, the Plan Committee shall
make payment as soon as possible after such person can be determined. Where
a distribution is triggered by termination of employment, the distribution
generally will not be made until after four (4) semi-monthly pay periods
following the termination to allow for all final contributions with respect
to the Participant to be recorded in the Trust. Once a terminated or
retired Participant or a Beneficiary attains age sixty-two (62),
distribution of benefits hereunder shall commence except if a disabled
Participant is receiving benefit service under the SunTrust Banks, Inc.
Retirement Plan until normal retirement at age sixty-five (65) with five
(5) years of service, then commencement of distribution of benefits
hereunder may be delayed by the Participant until the individual's normal
retirement under said Retirement Plan. Payment of a Participant's benefits
must commence not later than the 60th day after the close of the Plan Year
in which the latest of the following occurs:
50
(a) the date on which the Participant attains age sixty-five (65); or
(b) the tenth anniversary of the Participant's commencement of
participation in this Plan; or
(c) the date on which the Participant terminates service with the
Employer;
provided, however, that the distribution of a Participant's benefits shall
begin in accordance with the provisions of paragraph 9.5. Any distribution
is subject to the rights of a surviving spouse under paragraph 9.10 and to
the rights of an alternate payee under paragraph 14.4.
9.3 Consent to Distribution Prior to Age Sixty-Two. Unless the provisions of
paragraph 9.4 apply, no distribution of benefits may commence to a
Participant before the Participant attains age sixty-two (62) unless the
Participant is otherwise entitled to a distribution hereunder and the
Participant provides written consent to the commencement of the
distribution.
9.4 Limited Lump-Sum Payments. Notwithstanding anything to the contrary
pertaining to the payment of benefits, a lump-sum payment shall be made to
any Participant, spouse or Beneficiary where, at the time benefits
commence, the fair market value of the Total Account does not exceed Three
Thousand Five Hundred Dollars ($3,500), and such Participant, spouse or
Beneficiary shall be paid a lump-sum amount equal to his or her interest in
the Plan, thereby relinquishing any right or interest the recipient may
have in any other payments hereunder. Payment shall commence as of a
Valuation Date that is as soon as reasonably practicable following the date
the Participant terminates employment for any reason and payment shall
otherwise be made in accordance with this Section IX.
51
9.5 Limitation on Commencement and Period of Distribution. The following
provisions set limits on the extent to which commencement of benefits may
be delayed and on the time periods over which benefits may be distributed.
(a) All distributions generally must commence by the Participant's
"required beginning date", (as defined in this paragraph) subject to
any distribution elections made in advance of the required beginning
date, if applicable. A Participant's required beginning date is April
1 following the close of the calendar year in which the Participant
attains age 70 1/2. However, if the Participant is still actively
employed by a Company on December 31 of the year in which the
Participant attains age 70 1/2 and the Participant is not a five
percent (5%) owner, as defined below, then the required beginning date
shall be April 1 of the year following the year in which the
Participant retires from the Company or, if earlier, the April 1
following the close of the calendar year in which the Participant
becomes a five percent (5%) owner. A Participant shall be deemed to be
a five percent (5%) owner if the Participant is a "5-percent owner" as
defined in Section 416(i)(1)(B) of the Code for the Plan Year ending
in the calendar year in which the Participant attains age 70 1/2 or
any later Plan Year. A mandatory distribution will be made in a lump
sum at the Participant's required beginning date unless the
Participant, pursuant to the provisions of this Section IX, makes a
valid election to receive an alternative form of payment.
52
(b) The Plan Committee may not direct the Trustee to distribute the
Participant's benefit, nor may the Participant elect to have the
Trustee distribute his benefit, under a method of payment which, as of
the required beginning date, does not satisfy the minimum distribution
requirements under Section 401(a)(9) of the Code and the Treasury
Regulations issued thereunder. The minimum distribution for a calendar
year equals the Participant's benefit as of the latest Valuation Date
preceding the beginning of the calendar year divided by the
Participant's life expectancy or, if applicable, the joint and last
survivor expectancy of the Participant and his designated Beneficiary
(subject to the requirements of the Section 401(a)(9) of the Code and
the Treasury Regulations issued thereunder). The Plan Committee will
increase the Participant's benefit, as determined on the relevant
Valuation Date, for contributions or forfeitures allocated after the
last Valuation Date prior to the valuation calendar year, and will
decrease the valuation by distributions made after such Valuation
Date. For purposes of this valuation, the Plan Committee will treat
any portion of the minimum distribution for the first distribution
calendar year (as defined in Section 1.401(a)(9)-1, F-1 of the
Treasury Regulations) made after the close of that year as a
distribution occurring in that first distribution calendar year. In
computing a minimum distribution, the Plan Committee must use the
unisex life expectancy multiples under Section 1.72-9 of the Treasury
Regulations using the attained age of the Participant (and any
designated Beneficiary) as of the Participant's birthday (and any
designated Beneficiary's birthday) in the calendar year with respect
to which the calculation is made. The Plan Committee, only upon the
Participant's written request, will compute the minimum distribution
for a calendar year subsequent to the first calendar year for which
the Plan requires a minimum distribution by redetermining the
applicable life expectancy. However, the Plan Committee may not
redetermine the joint life and last survivor expectancy of the
Participant and a nonspouse designated Beneficiary in a manner which
takes into account any adjustment to a life expectancy other than the
Participant's life expectancy. If the Participant's spouse is not his
designated Beneficiary, a method of payment to the Participant
(whether by Participant election or by Plan Committee direction) may
not provide more than incidental benefits to the Beneficiary. For Plan
Years beginning after December 31, 1988, the Plan must satisfy the
minimum distribution incidental benefit ("MDIB") requirement in the
Treasury Regulations issued under Section 401(a)(9) of the Code for
distributions made on or after the Participant's required beginning
date and before the Participant's death. To satisfy the MDIB
requirement, the Plan Committee will compute the minimum distribution
required by this paragraph by substituting the applicable MDIB divisor
53
for the applicable life expectancy factor, if the MDIB divisor is a
lesser number. Following the Participant's death, the Plan Committee
will compute the minimum distribution required by this paragraph
solely on the basis of the applicable life expectancy factor and will
disregard the MDIB factor. For Plan Years beginning prior to January
1, 1989, the Plan satisfies the incidental benefits requirement if the
distributions to the Participant satisfied the MDIB requirement or if
the present value of the retirement benefits payable solely to the
Participant is greater than fifty percent (50%) of the present value
of the total benefits payable to the Participant and his or her
Beneficiaries. The Plan Committee must determine whether benefits to
the Beneficiary are incidental as of the date the Trustee is to
commence payment of the retirement benefits to the Participant, or as
of any date the Trustee redetermines the payment period to the
Participant. The minimum distribution for the first distribution
calendar year is due by the Participant's required beginning date. The
minimum distribution for each subsequent distribution calendar year,
including the calendar year in which the Participant's required
beginning date occurs, is due by December 31 of that year. If the
Participant receives distribution in the form of a nontransferable
term certain annuity contract, the distribution satisfies this
paragraph if the contract complies with the requirements of Section
401(a)(9) of the Code and the Treasury Regulations issued thereunder.
(c) The method of distribution to the Participant's Beneficiary must
satisfy Section 401(a)(9) of the Code and the Treasury Regulations
issued thereunder. If the Participant's death occurs after his
required beginning date or, if earlier, the date the Participant
commences an irrevocable term certain annuity, the method of payment
to the Beneficiary must provide for completion of payment over a
period which does not exceed the payment period which had commenced
for the Participant. If the Participant's death occurs prior to his
required beginning date, and the Participant had not commenced an
irrevocable term certain annuity, the method of payment to the
Beneficiary, must provide for completion of payment to the Beneficiary
over a period not exceeding: (i) five (5) years after the date of the
54
Participant's death; or (ii) if the Beneficiary is a designated
Beneficiary, the designated Beneficiary's life expectancy. The Plan
Committee may not direct payment of the Participant's Total Account
over a period described in clause (ii) unless the Trustee will
commence payment to the designated Beneficiary no later than the
December 31 of the calendar year following the calendar year in which
the Participant's death occurred or, if later, and the designated
Beneficiary is the Participant's surviving spouse, December 31 of the
calendar year in which the Participant would have attained age 70 1/2.
If the Trustee will make distribution in accordance with clause (ii),
the minimum distribution for a calendar year equals the Participant's
as of the latest Valuation Date preceding the beginning of the
calendar year divided by the designated Beneficiary's life expectancy.
The Plan Committee must use the unisex life expectancy multiples under
Section 1.72-9 of the Treasury Regulations for purposes of applying
this paragraph. The Plan Committee, only upon the written request of
the Participant or of the Participant's surviving spouse, will
recalculate the life expectancy of the Participant's surviving spouse
not more frequently than annually, but may not recalculate the life
expectancy of a nonspouse designated Beneficiary after the Trustee
commences payment to the designated Beneficiary. The Plan Committee
will apply this paragraph by treating any amount paid to the
Participant's child, which becomes payable to the Participant's
surviving spouse upon the child's attaining the age of majority, as
paid to the Participant's surviving spouse. Upon the Beneficiary's
written request, the Plan Committee must direct the Trustee to
accelerate payment of all, or any portion, of the Participant's unpaid
benefit, as soon as administratively practicable following the
effective date of that request.
9.6 Distribution to Alternate Payee Pursuant to a Qualified Domestic Relations
Order. Distribution of benefits to an Alternate Payee pursuant to a
Qualified Domestic Relations Order (as defined in Section 414(p) of the
Code and Paragraph 14.4) may commence in accordance with the distribution
provisions of the Plan at any time as specified by such Qualified Domestic
Relations Order. In such situations where the Alternate Payee's
distribution occurs prior to commencement of distributions to the
Participant whose account is subject to the Qualified Domestic Relations
Order and prior to the date the Participant attains his "earliest
retirement age" (as defined in Section 414(p)(4)(B) of the Code), the time
and form of payment shall be determined pursuant to the Plan as if the
Alternate Payee had been a Participant who terminated employment
immediately prior to the date of distribution specified in the Qualified
Domestic Relations Order. Notwithstanding the above, distribution of
benefits to an Alternate Payee shall not commence prior to the earlier of
(i) the date such Participant becomes eligible to receive a distribution or
(ii) the date such Participant attains the "earliest retirement age" unless
such Alternate Payee consents in writing to such early distribution, or
unless the present value of the benefit to be paid to such Alternate Payee
does not exceed Three Thousand Five Hundred Dollars ($3,500.00).
55
9.7 Manner of Distribution. The value of the Participant's accounts for
distribution purposes shall be the value of his accounts at the most recent
Valuation Date prior to the distribution. Prior to making a distribution of
benefits, the Trustee shall advise the Participant, surviving spouse or
Beneficiary, in writing, of the right to demand that benefits be
distributed solely in Employer Stock. If a Participant, surviving spouse or
Beneficiary demands that benefits be distributed solely in Employer Stock,
distribution of a Participant's benefit will be made in whole shares or
other units of Employer Stock. Any balance in a Participant's accounts not
invested in Employer Stock will be applied to acquire for distribution the
maximum number of whole shares or other units of Employer Stock at the then
fair market value. The value of any fractional unit of Employer Stock or
the unexpended balance will be distributed in cash. If Employer Stock is
not available for purchase by the Trustee, then the Trustee shall hold such
balance until Employer Stock is acquired and then make such distribution
unless the Participant, former Participant or Beneficiary requests
otherwise. If the Trustee is unable to purchase the Employer Stock required
for distribution, he shall make distribution in cash within one (1) year
after the date the distribution was to be made. Once a distribution becomes
payable and the Participant does not file a written election as to whether
to receive his distribution in cash or in kind within forty-five (45) days
after receipt of written notice of his right to file an election, the
Participant shall be deemed to have elected to receive the Employer Stock
allocated to his Employer Stock subaccounts unless the number of shares of
Employer Stock to be distributed is less than fifty (50), in which case the
distribution will be made in cash. Unless cash distributions are prescribed
pursuant to this paragraph, distributions will be made in shares of
Employer Stock, together with cash representing the value of fractional
shares and cash from Investment Fund subaccounts. Pursuant to rules
established by the Plan Committee, the Participant may elect to have all or
a portion of his account distributed in cash. If any disputes or
ambiguities arise with respect to distributions, the Trustee may ask the
Plan Committee to resolve the dispute or ambiguity. In order to liquidate
Employer Stock subaccounts for cash distributions, the Trustee may sell
Employer Stock as follows:
56
(a) on the securities exchange on which the Employer Stock is listed, or
(b) by means of a sale between the Trust subaccounts provided the
following conditions are met:
(i) the Trustee determines that a sale within the Trust subaccounts
will be in the best interests of the terminated Participant and
the remaining Participants and Beneficiaries,
(ii) no sales commissions are charged on the transaction,
(iii) the sales price is based upon the closing price of the Employer
Stock on the securities exchange on which the Employer Stock is
listed on the date of sale or, if the Employer Stock is not
traded on said date, on the next date on which trading resumes,
and
(iv) the date of sale must be determined by the Trustee prior to 2:00
p.m. of the date of sale.
If a terminated Participant's Employer Stock subaccount is liquidated for
cash distribution purposes, the terminated Participant shall be entitled to
receive an amount equal to the net cash proceeds received by the Trustee
for each share of Employer Stock sold by the Trustee.
9.8 Payment Options. Once a Participant or Beneficiary becomes entitled to
begin receiving benefits, he or she shall file a written request for
benefits with the Trustee. Subject to paragraphs 9.4 and 9.5, the former
Participant or Beneficiary shall be entitled to request in writing that the
benefits be rolled over pursuant to paragraph 9.9 or paid under a method of
payment selected by such Participant or Beneficiary, at his or her option,
from those methods of payment set forth below, provided, however, that no
distribution may be made under any method of payment which is in the form
of a life annuity or joint and survivor annuity:
57
(a) A lump-sum distribution;
(b) Approximately equal monthly, quarterly or annual installments (as
selected by the recipient) paid over a fixed period of years selected
by the Participant or Beneficiary provided such period does not exceed
thirty (30) years, or if less, the period required pursuant to the
provisions of paragraph 9.11. The Trustee shall estimate the
approximately equal monthly, quarterly or annual installments (as
selected by the recipient) that can be paid from the account over the
fixed period of years selected by the Participant or Beneficiary. The
Participant or Beneficiary will receive this monthly, quarterly or
annual installment until the account is reduced below the amount of
one installment payment or the fixed term of years is reached. If the
account is reduced below the amount of one installment payment, on the
date that the next installment is due the remaining balance shall be
distributed regardless of the number of payments that were expected or
the number of actual payments that are made and no further payments
will be made. If the actual number of payments made equals the number
of payments expected under the fixed term of years, the balance of the
funds in the participant's account which remains after the final
monthly payment has been deducted shall be distributed along with the
final monthly payment. The Trustee shall set the installments after
taking into consideration the balance in the account, the expected
future earnings on the account, any expenses that may be allocated to
the account and any other factors or reasonable actuarial assumptions
that are necessary in making a reasonable estimate and such amount may
be increased or decreased by the Trustee as of the beginning of any
Plan Year if the Trustee determines that their original estimate needs
to be materially revised in order to make approximately equal
distributions over the remaining installments in the fixed term of
years.
58
An installment payment shall not be less than an amount equal to .0833
(for monthly installments), .25 (for quarterly installments) or one
(1) (for annual installments) times the amount obtained by dividing
the value of the Participant's account as of the most recent year-end
Valuation Date by either (i) the Participant's life expectancy, or
(ii) the joint and last survivor expectancy of the Participant and his
or her designated Beneficiary at the time benefit payments commenced,
less one (1) year for each Plan Year which has commenced since benefit
payments commenced. Life expectancies shall be calculated using the
return multiples of Treasury Regulation Section 1.72-9.
After a Participant or Beneficiary has begun to receive installment
payments as described above, such Participant or Beneficiary may
elect, not more often than once in any twelve (12) month period, to
accelerate payments by filing a written request for such acceleration
of payments with the Plan Committee. The accelerated payments may be
in the form of a lump sum payment or in the form of accelerated
installment payments. Such accelerated payments shall commence as soon
as administratively feasible after receipt of the written request by
the Plan Committee.
9.9 Rollover to Eligible Retirement Plan. This paragraph applies to
distributions made on or after January 1, 1993. Notwithstanding any
provision of this Plan to the contrary that would otherwise limit a
distributee's election under this paragraph, a distributee may elect, at
the time and in the manner prescribed by the Plan Committee, to have any
portion of an eligible rollover distribution paid directly to an eligible
retirement plan specified by the distributee in a direct rollover. For
purposes of this Paragraph 9.6, the following definitions shall apply:
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 section 401(a)(9) of the Code; and the
portion of any distribution that is not includible in gross income
(determined without regard to the exclusion for net unrealized appreciation
with respect to employer securities).
59
An "eligible retirement plan" is an individual retirement account described
in section 408(a) of the Code, an individual retirement annuity described
in section 408(b) of the Code, an annuity plan described in section 403(a)
of the Code, or a qualified trust described in section 401(a) of the Code,
that accepts the distributee's eligible rollover distribution. However, in
the case of an eligible rollover distribution to the surviving spouse, an
eligible retirement plan is an individual retirement account or individual
retirement annuity.
A "distributee" includes an employee or former employee. In addition, the
employee's or former employee's surviving spouse and the employee's or
former employee's spouse or former spouse who is the alternate payee under
a qualified domestic relations order, as defined in section 414(p) of the
Code, are distributees with regard to the interest of the spouse or former
spouse.
A "direct rollover" is a payment by the plan to the eligible retirement
plan specified by the distributee.
9.10 Designation of Beneficiary. Except as provided below, if a Participant dies
before his Total Account has been distributed to him, then such Total
Account shall be payable upon the death of the Participant to the
Participant's Surviving Spouse regardless of any Beneficiary designation to
the contrary, and no designated Beneficiary shall have any rights, claims,
or actions for benefits under this Plan. If the Participant has no
surviving Spouse, the Participant's Surviving Spouse cannot be located, or
the Participant's Surviving Spouse consents in the manner described below,
such Total Account may be paid to a Beneficiary designated by the
Participant on a form filed with the Plan Committee or its designated
agent. A consent by a Participant's Surviving Spouse under the Plan shall
be effective only if the Surviving Spouse consents in writing to such
election on a form prescribed by the Plan Committee, the consent
acknowledges the effect of the election, the consent is witnessed by a
representative of the Plan or a notary public, and the consent is received
by the Plan Committee or its designated agent prior to the death of the
Participant. A Participant may revoke the designation of a Beneficiary at
60
any time by filing a written revocation with the Plan Committee or its
designated agent prior to his death. A Participant may change the
designated Beneficiary at any time prior to his death only in accordance
with the provisions of the Plan and rules established by the Plan
Committee. Any consent by a Surviving Spouse (or establishment that the
consent of a Surviving Spouse may not be obtained) shall be effective only
with respect to such spouse. If there is no Surviving Spouse, and (i) the
designated Beneficiary does not survive the Participant, or (ii) no
Beneficiary designation is in effect at the time of the death of the
Participant, then the Beneficiary shall be the Participant's surviving
issue, per stirpes, or if none surviving, the estate of the Participant.
For purposes of this paragraph, the term "Surviving Spouse" shall mean the
spouse of a Participant at the time of his death provided that they were
legally married, in a religious or civil ceremony recognized under the laws
of the state where the marriage was contracted, for at least one (1) year
prior to the date of the Participant's death. The Plan Committee and any
agent shall be fully protected in directing payment in accordance with a
consent described above, and the Plan shall be discharged from liability to
the extent of payments made pursuant to the consent.
9.11 Withdrawal of Benefits. Upon prior written notice as prescribed by
regulations of the Plan Committee, a Participant may withdraw any portion
of his account that is attributable to after-tax Employee contributions
(Voluntary Contributions) made by the Participant under a Prior Plan or
Prior PAYSOP. As set forth in subparagraphs (a) or (b) below, a Participant
may withdraw benefits subject to the following conditions:
(a) If a Participant who is employed by a Company can demonstrate that the
condition of Hardship exists as determined by regulations established
by the Plan Committee, upon prior written notice to the Plan Committee
a Participant may withdraw any portion of his Elective Contributions
made on or after January 1, 1993 (but not the earnings thereon). In
addition, if the Plan Committee determines that the condition of
Hardship exists, the Participant may withdraw any portion of his
account that is attributable to (i) pre-tax Employee contributions
made by the Participant under a Prior Plan, but excluding earnings on
such contributions accrued after December 31, 1988, or (ii) Company
Contributions allocated to the Participant's Company Contribution
account after December 31, 1988 provided that such Company
Contributions have been held by the Trustee and allocated to the
account for at least twenty-four (24) months. However, the Plan
Committee shall permit a hardship distribution only on account of an
immediate and heavy financial need of the Participant, as determined
by subparagraph (i) and only to the extent that the distribution is
necessary to satisfy such immediate and heavy financial need, as
determined by subparagraph (ii).
61
(i) Deemed immediate and heavy financial need. A distribution will be
deemed to be made on account of an immediate and heavy financial
need of the Participant if the distribution is on account of:
(aa) Medical care for expenses described in section 213(d) of the
Code previously incurred by the Participant, the
Participant's spouse, or any dependents of the Participant
(as defined in section 152 of the Code) or for the need of
these persons to obtain medical care described in section
213(d);
(bb) Costs directly related to the purchase (excluding mortgage
payments) of a principal residence for the Participant;
(cc) Payment of tuition and related educational fees for the next
12 months of post-secondary education for the Participant,
his or her spouse, children, or dependents (as defined in
section 152 of the Code);
(dd) The need to prevent the eviction of the employee from his
principal residence or foreclosure on the mortgage of the
Participant's principal residence;
(ee) Financial needs due to the death of the Participant, his
spouse or dependents; or
62
(ff) Any other catastrophic financial hardship that the Plan
Committee determines to be similar in severity to the
reasons set forth in subparagraphs (aa) through (ee) above,
but not including repayment of debt.
(ii) Distribution deemed necessary to satisfy financial need. A
distribution will be deemed to be necessary to satisfy an
immediate and heavy financial need of the Participant if all of
the following requirements are satisfied:
(aa) The distribution is not in excess of the amount of the
immediate and heavy financial need of the Participant plus
any income or excise taxes that will be due as a result of
the hardship distribution.
(bb) The Participant has obtained all distributions, other than
hardship distributions, and all nontaxable loans currently
available under all plans maintained by the Employer,
(cc) The Participant's Elective Contributions will be suspended
for at least 12 months after receipt of the hardship
distribution, and
(dd) The Participant may not make Elective Contributions for the
Participant's taxable year immediately following the taxable
year of the hardship distribution in excess of the
applicable limit under Section 402(g) of the Code for such
next taxable year less the amount of such Participant's
Elective Contributions for the taxable year of the hardship
distribution.
(b) In addition, upon a Participant's attainment of age fifty-nine and
one-half (59-1/2) the Participant may withdraw all or part of his or
her account. A withdrawal shall be effective and payment shall be made
as soon as practicable after the withdrawal has been approved. There
will be no suspension of contributions for withdrawals hereunder and
the Participant shall be entitled to receive Company Contributions as
provided herein.
63
9.12 Participant Loans. Participants, former Participants and Beneficiaries who
are "parties in interest" as defined by Section 3(14) of ERISA may borrow
funds from any accounts provided the loan is authorized pursuant to uniform
and nondiscriminatory guidelines adopted by the Plan Committee and based
upon the following standards and conditions:
(i)An eligible Participant or Beneficiary shall be entitled to borrow from
his account a portion of the net value of the account as of the most
recent Valuation Date. The minimum amount of any loan shall be one
thousand dollars ($1,000). The amount of any new loan from this Plan
when added to the balance due on all loans to the Participant, former
Participant or Beneficiary under this Plan and any other qualified
plan of the Company or an Affiliate shall not exceed the lesser of
(aa) or (bb) below.
(aa) $50,000, reduced by the excess (if any) of
(1) The Participant's (or former Participant's or
Beneficiary's) highest outstanding balance due on all
loans from such Plans during the one (1) year period
ending on the day before the date on which any new loan
is made, over
(2) The outstanding balance due on all loans from such Plan
on the date on which any new loan is made, or
(bb) one-half (1/2) of the present value of the Participant's (or
former Participant's or Beneficiary's) account.
64
(ii) Loans shall be made available to all Participants, former
Participants and Beneficiaries who are parties in interest on a
reasonably equivalent and non-discriminatory basis. Except as
provided in Section 72(p) of the Code, all loans shall be repaid
within sixty (60) months of the date the loan was originally
granted. All loans shall bear a reasonable rate of interest and
shall require interest and principal payments to be amortized on
a substantially level basis with payments not less frequently
than quarterly. All loans must be adequately secured by
collateral acceptable to the Plan Committee which may include a
pledge of up to fifty percent (50%) of the Participant's, former
Participant's or Beneficiary's account, subject to the consent
requirement prescribed in this paragraph; provided, however, that
the Trustee may not levy on the pledge and offset any portion of
the Participant's account in excess of the Participant's net
Voluntary Contributions remaining in the account until the
Participant is at least fifty-nine and one half (59-1/2) years of
age or the Participant is entitled to distribution of all or any
portion of his account excluding Voluntary Contributions. In the
case of a loan which is made from or secured by a pledge of any
portion of the Participant's account which would be subject to
the joint and survivor annuity rules set forth in Section
401(a)(11) of the Code if distributed at the time the loan is
made, no such loan may be made unless the consent of the
Participant and the Participant's Spouse (if any) is obtained to
the loan and to the fact that a set-off of the account balance
may occur to satisfy, in whole or in part, any unpaid loan
balance in default. Such consent must be obtained within the
ninety (90) day period before the making of the loan. New
consents will be required upon any renegotiation, extension,
renewal or other revision of the loan, which shall be treated as
the making of a new loan on the date of the renegotiation,
extension, renewal or other revision. Participant loans which are
made solely from or secured solely by accounts that are not
subject to the joint and survivor annuity rules shall not require
spousal consent. No provision of this subparagraph shall be
deemed to create a right in any Participant, spouse or
Beneficiary to receive a distribution in the form of an annuity
of any kind except as is specifically set forth elsewhere in this
Plan document.
65
(iii) Loans shall be considered investments of a self-directed account
for the Participant, former Participant or Beneficiary and all
interest thereon shall accrue to the self-directed account.
(iv) The Plan Committee may adopt additional rules pertaining to Plan
loans as may be necessary to protect the tax-qualified status of
the Plan; to comply with ERISA and the Code; and to administer
Plan loans in a manner which will prevent loan administration
expenses from becoming an undue burden on the Plan, the
Participants and the Employer, which may include reasonable loan
fees.
9.13 Put Option. If Employer Stock is distributed to a Participant and such
Employer Stock is not readily tradeable on an established market or is
subject to a trading limitation when distributed, a Participant has a right
to require the Company to repurchase the Employer Stock distributed to such
Participant as required by Section 409(h) of the Code. For purposes of this
paragraph, a "trading limitation" on Employer Stock is a restriction under
any Federal or State securities law or any regulation thereunder, or an
agreement (not prohibited by paragraph 12.5) affecting the Employer Stock
which would make the Employer Stock not as freely tradeable as stock not
subject to such restriction. The put option must be exercisable only by a
Participant, by the Participant's donees, or by a person (including an
estate or its distributee) to whom the Employer Stock passes by reason of a
Participant's death. (Under this paragraph "Participant" means a
Participant and the Beneficiaries of the Participant under the Plan.) The
put option must permit a Participant to put the Employer Stock to the
Company. Under no circumstances may the put option bind the Plan or Trust.
However, it shall grant the Plan or Trust an option to assume the rights
and obligations of the Company at the time that the put option is
exercised. If it is known at the time a loan is made that federal or state
law will be violated by the Company's honoring such put option, the put
option must permit the Employer Stock to be put, in a manner consistent
with such law, to a third party (e.g., an Affiliate of the Company or a
66
shareholder other than the Plan) that has substantial net worth at the time
the Exempt Loan is made and whose net worth is reasonably expected to
remain substantial. The option must be exercisable during a fifteen (15)
month period which begins on the date the Employer Stock subject to the put
option is distributed by the Plan and, if the put option is not exercised
within such period, the put option must be exercisable during a period of
at least sixty (60) days in the Plan Year following the Plan Year in which
the distribution was made. However, in the case of Employer Stock that is
publicly traded without restrictions when distributed, but ceases to be so
traded within fifteen (15) months after distribution, the Company must
notify each holder of such Employer Stock in writing on or before the tenth
(10th) day after the date the Employer Stock ceases to be so traded that
for the remainder of the fifteen (15) month period the Employer Stock is
subject to the put option. The number of days between the tenth (10th) day
and the date on which notice is actually given, if later than the tenth
(10th) day, must be added to the duration of the put option. The notice
must inform distributees of the term of the put options that they are to
hold. The terms must satisfy the requirements of this paragraph.
The put option is exercised by the holder notifying the Company in writing
that the put option is being exercised; the notice shall state the name and
address of the holder and the number of shares to be sold. The period
during which a put option is exercisable does not include any time when a
distributee is unable to exercise it because the party bound by the put
option is prohibited from honoring it by applicable federal or state law.
The price at which a put option must be exercisable is the value of the
Employer Stock determined in accordance with Treasury Regulation Section
54.4975-11(d)(5). If the Employer Stock is not readily tradable on an
established securities market, with respect to activities carried on by the
Plan the value shall be determined by an independent appraiser who meets
requirements similar to the requirements set forth in the regulations
prescribed under Section 170(a)(1) of the Code. The provisions for payment
under the put option must be reasonable. The deferral of payment is
reasonable if adequate security and a reasonable interest rate are provided
for any credit extended and provided payments are made as follows:
(a) If the distribution constitutes a total distribution, as defined
below, payment of the fair market value of a Participant's Employer
Stock shall be made in five (5) substantially equal annual payments.
The first installment shall be paid not later than thirty (30) days
after the Participant exercises the put option.
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(b) If the distribution does not constitute a total distribution, the Plan
shall pay the Participant an amount equal to the fair market value of
the Employer Stock repurchased no later than thirty (30) days after
the Participant exercises the put option.
For purposes of this paragraph, a "total distribution" shall mean a
distribution to a Participant or a Participant's Beneficiary, within one
(1) taxable year of such recipient, of the entire balance to the credit of
the Participant. Payment under a put option must not be restricted by the
provisions of a loan or any other arrangement, including the terms of the
Company's articles of incorporation, unless so required by applicable state
law.
An arrangement involving the Plan that creates a put option must not
provide for the issuance of put options other than as provided under this
paragraph. The Plan and the Trust Fund must not otherwise obligate itself
to acquire Employer Stock from a particular holder thereof at an indefinite
time determined upon the happening of an event such as the death of the
holder.
9.14 Model Amendment Precluding In Service Distributions on Pension Plan Assets.
Notwithstanding any provision of this Plan to the contrary, on and after
March 12, 1995 to the extent that any optional form of benefit under this
Plan permits a distribution prior to the Employee's retirement, death,
disability, or severance from employment, and prior to plan termination,
the optional form of benefits is not available with respect to benefits
attributable to assets (including the post-transfer earnings thereon) and
liabilities that are transferred, within the meaning of Code Section
414(l), to this Plan from a money purchase pension plan qualified under
Code Section 401(a) (other than any portion of those assets and liabilities
attributable to voluntary Employee contributions).
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SECTION X - TOP-HEAVY PLANS
---------------------------
10.1 Top-Heavy Defined. For all Plan Years beginning after December 31, 1983,
the Plan shall be considered a Top-Heavy Plan if, as of the Top-Heavy
Determination Date, either of the following occurs:
(a) The sum of the present value of the Total Account (as set forth in
paragraph 10.2) of Key Employees exceeds sixty percent (60%) of the
present value of the Total Account of all Participants, or
(b) The Plan is considered to be part of a Top-Heavy Group under paragraph
10.3.
If a Participant remains employed but ceases to be a Key Employee, the
present value of his Total Account shall be disregarded in the top-heavy
determination for any Plan Year after the last Plan Year for which the
Participant was a Key Employee.
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If a Participant has not performed services for the Company maintaining the
Plan at any time during the five (5) year period ending on the Top-Heavy
Determination Date, any accrued benefit for such Participant (or account
balance of such Participant) shall be disregarded in the Top-Heavy
Determination for such Plan Year.
10.2 Top-Heavy Valuation Date. The present value of a Participant's Total
Account as of the Top-Heavy Determination Date shall be equal to the
following:
(a) The Participant's Total Account as of the Top-Heavy Determination
Date,
(b) Contributions that are allocated to the Participant's Total
Account as of the Top-Heavy Determination Date but not included
in the Total Account for purposes of subparagraph (a) above, even
though these amounts are not yet contributed to the trust as of
said date, and
(c) Any distributions from the trust made with respect to the Participant
within the five (5) Plan Years ending on the Top-Heavy Determination
Date.
If the Plan is terminated, but would have been included in an aggregation
group under Section 416(g)(2)(A)(i) of the Code had it not been terminated,
then such distribution shall be taken into account under subparagraph (c)
above.
10.3 Top-Heavy Group Defined. Any defined benefit plan or defined contribution
plan which is a required aggregation plan, as defined below, shall be
considered to be part of a Top-Heavy Group and therefore a Top-Heavy Plan
if:
(a) The sum (as of the Top-Heavy Determination Date) of:
(i) The present value of the cumulative accrued benefits, as adjusted
pursuant to paragraph 10.7, for Key Employees (as modified by
paragraph 10.8) under all defined benefit plans in such group,
including frozen plans and plans terminated within the five-year
period ending on the Top-Heavy Determination Date, and
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(ii) the present value of the Participant's Total Account, as defined
in paragraph 10.2, of Key Employees, as modified by paragraph
10.8, under all defined contribution plans, including frozen
plans, in such group,
(b) Exceeds 60 percent of a similar sum determined for all Employees.
Any Company sponsored defined benefit plan or defined contribution plan,
which is not a required aggregation plan, as defined below, shall not be
considered a Top-Heavy Plan by virtue of the provisions of this Plan due to
the fact the required aggregation group, with which such plans are
permitted to be aggregated, is deemed to be a top-heavy group. A "required
aggregation plan" is any defined benefit or defined contribution plan of
the Company which includes any Key Employee as a participant or any other
plan which enables a plan of the Company that includes any Key Employee to
meet the requirements of Sections 401(a)(4) or 410 of the Code. Solely for
the purpose of determining if this Plan, or any other plan included in a
required aggregation group of which this Plan is a part, is a Top-Heavy
Plan, the accrued benefit of an Employee other than a Key Employee shall be
determined under (a) the method, if any, that uniformly applies for accrual
purposes under all plans maintained by the Company and any Affiliate, or
(b) if there is no such method, as if such benefit accrued no more rapidly
than the slowest accrual rate of Section 411(b)(1)(C) of the Code.
10.4 Adjusted Section 415 Limitations. For each Plan Year in which the Plan is a
Top-Heavy Plan, the overall limitations on combined plan contributions and
benefits under Section 415 of the Code shall be reduced by substituting 1.0
for 1.25 in the definitions of defined contribution fraction and defined
benefit fraction in paragraph 5.12 of the Plan unless both of the following
tests are satisfied:
(a) The Plan would not be a Top-Heavy Plan if "ninety percent (90%)" were
substituted for "sixty percent (60%)" in each place that it appears in
paragraph 10.1 and paragraph 10.3, and
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(b) Each Participant who is not a Key Employee receives an additional
minimum benefit or contribution under a plan of the Company. In the
case of a non-Key Employee participating only in a defined benefit
plan, the additional minimum benefit for each year of service counted
is one (1) percentage point, up to a maximum of ten (10) percentage
points, of the Participant's average compensation for the five (5)
consecutive years when the Participant had the highest aggregate
compensation from the Company, computed as described in Section
416(c)(1)(D) of the Code. In the case of a non-Key Employee
participating only in this or another defined contribution plan, the
minimum contribution shall be four percent (4%) of the Participant's
compensation. In the case of a non-Key Employee participating both in
a defined benefit plan and this or another defined contribution plan,
there shall be no additional minimum benefit, but the minimum
contribution shall be seven and one-half percent (7.5%) of the
Participant's compensation.
10.5 Anti-Cutback Rule. No change in the Plan's Top-Heavy status shall cause the
account balance of any Participant to be reduced in violation of Section
411 of the Code.
10.6 Adjustments to Accrued Benefit. The present value of the cumulative accrued
benefit of a Participant shall be calculated using the actuarial
assumptions utilized in funding any defined benefit plan and shall include
the aggregate distributions made with respect to such Participant under the
Plan during the five-year period ending on the Top-Heavy Determination
Date.
10.7 Employees Included in Computations. For the Plan Years beginning after
December 31, 1984, the value of the accrued benefit and the Total Account,
as defined in paragraph 10.2, of a Participant shall not be taken into
account if the Participant has not performed at least one (1) hour of
Service during the five-year period ending on the Top-Heavy Determination
Date. If the former Employee is rehired thereafter and performs at least
one (1) hour of Service, his or her total accrued benefit and Total Account
shall be included in the top-heavy calculation. If a Participant remains
employed but ceases to be a Key Employee, the present value of his or her
accrued benefit and Total Account shall be disregarded in the top-heavy
determination for any Plan Year after the last Plan Year for which the
Participant was a Key Employee.
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SECTION XI - ADMINISTRATION OF THE PLAN
---------------------------------------
11.1 Designation of Responsibility. The Plan shall be administered by a Plan
Committee of not less than three (3) persons to be appointed by and serve
at the discretion of the Chairman of the Compensation Committee (the
"Chairman"). The Corporation or its 92 designated agent, shall be the
Administrator of the Plan, within the meaning of ERISA. The authority to
control and manage the operation and administration of the Plan and Trust
is designated for the following fiduciaries within specified areas of
responsibility:
the Plan Committee,
the Compensation Committee,
the Trustee, and
the Board.
(a) The Plan Committee. The Plan Committee shall be the general
administrator of the Plan and shall be entitled to make certain
amendments to the Plan and shall have complete responsibility for the
operation and administration of the Plan including those powers and
duties set forth in paragraph 11.2 but excluding those areas of
responsibility specifically or by necessary implication allocated in
the Plan to the Trustee, the Compensation Committee or the Board. The
Plan Committee shall elect a chairman from among its members and a
secretary who need not be a member. The members of the Plan Committee
may allocate among themselves by mutual consent, or to others pursuant
to paragraph 11.2(g), specific Plan Committee responsibilities and
functions for the operation and administration of this Plan, provided
such allocation is reported in the minutes of the Plan Committee.
(b) The Compensation Committee. The Compensation Committee may amend the
Plan and perform such other duties as may be delegated to the
Compensation Committee by the Board.
(c) The Trustee. The Trustee has responsibility for the management,
investments and control of the Trust Fund as described in Section XII
and the Trust Agreement and for providing the financial information
regarding the Trust as requested by the Plan Committee, the Board or a
regulatory authority.
(d) The Board. The Board shall have complete responsibility for the
appointment and removal of the members of the Plan Committee, for the
amendment and termination of the Plan and Trust Agreement, and for the
performance of such other duties specifically or by necessary
implication allocated to the Board.
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11.2 Responsibility of the Plan Committee. In addition to the implied powers and
duties which may be needed to carry out the administration of the Plan, the
Plan Committee shall have the following specific responsibilities:
(a) To amend the Plan provided such amendment does not affect the amount
of Elective Contributions, Matching Contributions or Company
Contributions a Participant may contribute to or receive in his Plan
account.
(b) To designate Affiliates as Companies under the Plan.
(c) To establish and enforce rules and regulations as required for the
efficient administration of the Plan.
(d) To make final determinations on a Participant or Beneficiary's
eligibility to participate and eligibility for benefits from the Plan
and to resolve disputes between claimants.
(e) To set and adjust the percentage of Base Compensation deferred by
Highly Compensated Active Participants pursuant to paragraphs 4.2 and
5.2.
(f) To authorize disbursement of benefits by the Trustee to a Participant
or Beneficiary.
(g) To review, interpret, construe and remedy Plan provisions that are
ambiguous or inconsistent. All determinations and actions of the Plan
Committee will be conclusive and binding upon all persons, except as
otherwise provided herein or by law, and except that the Plan
Committee may revoke or modify a determination or action previously
made in error. The Plan Committee will exercise all powers and
authority given to it in a non-discriminatory manner, and will apply
uniform administrative rules of general application to insure that
persons in similar circumstances are treated alike.
(h) To remove the Trustee and replace with a successor Trustee according
to the provisions of the Trust Agreement.
73
(i) To delegate to third parties by written instrument the authority to
perform the following functions in accordance with the provisions of
this Plan, the Trust Agreement and ERISA and other applicable laws:
(i) to approve loans and direct the Trustee to fund the loans;
(ii) to approve and direct the Trustee to complete distribution of
benefits due hereunder following termination of employment for
any reason as well as upon receipt of a request for an in-service
distribution other than hardship distributions;
(iii) to make determinations as to whether a Participant is under a
Disability;
(iv) to interpret Beneficiary designations and authorize the Trustee
to distribute benefits following the death of a Participant or a
Beneficiary; and
(v) such other administrative duties similar to those delineated in
this subparagraph (g) as determined in the sole discretion of the
Plan Committee.
(j) To perform such other actions as may be delegated to the Plan
Committee by the Compensation Committee or the Board.
11.3 Responsibility of the Compensation Committee. The Compensation Committee
shall have the following power and authority:
(a) To approve Plan amendments.
(b) To perform such other actions as may be delegated to the Compensation
Committee by the Board.
(c) To delegate any of its responsibilities to the Plan Committee or other
appropriate agents.
11.4 Responsibility of the Board. Subject to provisions of the Plan, the Board
or its duly appointed agent shall have the following power and authority:
74
(a) To approve initial Plan provisions and subsequent amendments.
(b) To terminate the Plan as required by changes within the Corporation
and authorize completion of regulatory requirements.
(c) To delegate any of its responsibilities to the Compensation Committee,
the Plan Committee or other appropriate agents.
11.5 Records of the Plan Committee. The Plan Committee shall keep appropriate
records of its proceedings and the administration of the Plan. The Plan
Committee shall make available to Participants and their Beneficiaries for
examination, during business hours, such records of the Plan as pertain to
the examining person and such documents relating to the Plan as are
required by ERISA.
11.6 Plan Committee Action. Action may be taken by the Plan Committee at any
meeting where a majority of its members are present and at any such meeting
any action may be taken which shall be approved by a majority of the
members present. The Plan Committee may also take any action without a
meeting that is approved by a majority of the Plan Committee members and is
evidenced by a written document signed by a member of the Plan Committee.
The Plan Committee may delegate any of its rights, powers and duties to any
one or more of its members, or to any other person, by written action as
provided herein, acknowledged in writing by the delegate or delegates. Such
delegation may include, without limitation, the power to execute any
document on behalf of the Plan Committee, and the Chairman of the Plan
Committee shall be the agent of the Plan Committee and of the Plan for the
service of legal process at the principal office of the Company.
11.7 Plan Committee Disqualification. A member of the Plan Committee who may be
a Participant shall not vote on any question relating specifically to
himself.
11.8 Compensation. No member of the Plan Committee shall receive any
compensation from the Plan for his services as a Plan Committee member.
11.9 Reliance on Reports. The members of the Plan Committee and the officers and
directors of the Corporation and of any Company shall be entitled to rely
on all certificates and reports made by any duly appointed accountant, and
on all opinions given by any duly appointed legal counsel. Such counsel may
be counsel for the Corporation or any other Company or for the Trustee.
75
11.10 Use of Agents. Any member of the Plan Committee or any other fiduciary may
use, employ, discharge or consult with one or more individuals,
corporations or other entities with respect to advice regarding any
responsibility, obligation or duty in connection with the Plan. Any member
of either committee and any other fiduciary may designate other
individuals, corporations, or other entities to carry out his
responsibilities, obligations and duties with respect to the Plan, except
to the extent that ERISA prohibits delegation of authority and discretion
to manage and control the assets of the Trust. Such delegations may be
revoked or modified at any time. Any such delegation, revocation or
modification shall be made by written instruments signed by the respective
committee member or other fiduciary, and a written record shall be kept
thereof. No committee member or other fiduciary shall be liable for the
directions, actions, or omissions of any individual, corporation, or other
entity who has been designated to carry out any responsibilities,
obligations or duties in connection with the Plan, but shall be fully
protected by any action taken or suffered by him in good faith in reliance
upon the advice or opinion of any such individual, corporation or other
entity. To the extent compensation and expenses of agents or advisors of
the Plan Committee constitute reasonable expenses of administering the
Plan within the meaning of Sections 403(c)(1) and 404(a)(1)(A) of ERISA)
the compensation (as fixed by the Plan Committee) of such agents or
advisors shall be paid from the Trust Fund unless (1) the payment of such
expense would constitute a "prohibited transaction" within the meaning of
Section 406 of ERISA or Section 4975 of the Code or (2) the Corporation
elects in writing to pay such expenses.
11.11 Benefit Claims. The Plan Committee shall make all final determinations as
to the right of any person to a benefit. Claims for benefits under the
Plan shall be filed in writing with the Plan Committee. Written notice of
the disposition of a claim shall be furnished to the claimant within
ninety (90) days after the application therefor is filed unless special
circumstances require an extension of time for processing the claim in
which case the Plan Committee shall provide written notice of the
extension of time prior to expiration of the initial ninety (90) day
period. In the event the claim is denied, the reasons for the denial shall
be specifically set forth, pertinent provisions of the Plan shall be cited
and, where appropriate, an explanation as to how the claimant can perfect
the claim will be provided. In the event the Plan has ambiguous, unclear
or inconsistent provisions which impact the payment, amount or timing for
receipt of benefits, the Plan Committee shall have full authority, as set
forth in paragraph 11.2, to interpret, construe and/or remedy any such
Plan provisions and to make a final determination as to the payment,
amount or timing for distribution of benefits.
76
11.12 Notice of Committee Action and Appeals. Any Participant, Employee or
Beneficiary of either, who has been denied a benefit, or feels aggrieved
by any action of the Company, the Trustee or the Plan Committee, shall be
entitled, upon written request to the Plan Committee, to receive a written
notice of such action, together with a full and clear statement of the
reasons for the action. If the claimant wishes further consideration of
his position, he may then submit to the Plan Committee his or her written
position, including all written evidence regarding the claim, not later
than ninety (90) days after he has received written notification of the
disposition of his claim. The Plan Committee shall then review the claim
in full within the next sixty (60) days or, if special circumstances exist
which require additional time to complete the review, then within a
maximum of one-hundred twenty (120) days from receipt of the request for
review, and the final decision following such review shall be made by the
Plan Committee and shall be communicated to the claimant within said
one-hundred twenty (120) day period. If the decision will not be made and
communicated to the claimant within sixty (60) days of receipt of the
request for review the claimant shall be notified in writing of the delay
within said sixty (60) days or the claim shall be deemed to have been
denied.
11.13 Annual Statements. As soon as practicable after the last Valuation Date of
each Plan Year, or more often as determined by the Plan Committee, the
Plan Committee shall prepare and deliver to each Participant a written
statement showing as of that annual Valuation Date the following
information as well as any additional information as determined by the
Plan Committee:
(a) The balance in his account in the Trust Fund as of the preceding
annual Valuation Date;
77
(b) The amount of contributions allocated to his account for the Plan Year
ending on such annual Valuation Date;
(c) The adjustments to his account to reflect his share of net earnings
during the Plan Year ending on such annual Valuation Date; and
(d) The new balance in his account as of that annual Valuation Date.
11.14 Unclaimed Benefits. If at, after, or during the time when a benefit
hereunder is payable to any Participant, Beneficiary or other distributee,
the Plan Committee, upon request of the Trustee, or at his own instance,
shall determine, after a diligent search, such as the use of credit
reporting agencies or procedures with government agencies for locating
individuals, that the Participant, Beneficiary or other distributee can
not be located or contacted, the Plan Committee may declare such
individual as a lost Participant. In such event, all accounts held
hereunder for such individual shall be forfeited as of the first Valuation
Date coincident with or following the later of (i) the date the Plan
Committee determines the individual is a lost Participant, or (ii) the
first date the Plan allows the Plan Committee to direct the Trustee to
distribute the lost Participant's benefits without the recipient's written
consent as set forth pursuant to paragraphs 9.2 and 9.3; provided,
however, that such forfeited benefit shall be reinstated if a claim for
the same is made by the Participant, Beneficiary or other distributee at
any time thereafter. Such reinstatement shall be made from forfeitures
available in the current Plan Year or, if forfeitures are not sufficient,
from funds specially contributed by the Company for such purpose. Any
forfeiture resulting from the operation of this paragraph shall be applied
to reduce the Company's Guarantee Matching Contributions with any excess
used to reduce the Company's Performance Matching Contribution. If a
forfeiture still remains unallocated, it shall be used as of the last
Valuation Date of the Plan Year as an additional Performance Matching
Contribution.
11.15 Indemnification. The members of the Plan Committee, the Trustee, the
Board and the officers and directors of the Companies shall be indemnified
to the extent permissible under law and consistent with the Corporation's
charter and by-laws, and held harmless by the Companies for any costs,
expenses, losses, liabilities or assessments arising out of any action
taken or omitted by them in good faith in reliance upon the advice or
opinion of any person selected by the fiduciaries to perform services for
this Plan and all action so taken or omitted shall be conclusive upon each
of them and upon all other persons interested in this Plan. To the extent
that a member of the Plan Committee is not protected and held harmless by
or through insurance,
78
(a) any expense or other cost, of any kind or description whatsoever,
including legal fees and expenses, actually incurred by him or her on
account of any action or proceeding, actual or threatened, which
arises as a result of his or her being a member of the Plan Committee,
provided he or she acted in good faith and neither settles nor
compromises the action or proceeding against him, nor confesses any
liability therefor, nor is ultimately determined to be liable for all
or any portion of the amount stipulated in such action or proceeding
or to be subject to an injunction or any other remedy which would
constitute reasonable expenses of administering the Plan (within the
meaning of Sections 403(c)(1) and { 404(a)(1)(A) of ERISA) shall be
paid (or the member shall be reimbursed) from the Trust Fund unless
(1) the payment of such expense would constitute a "prohibited
transaction" within the meaning of Section 406 of ERISA or Section
4975 of the Code or (2) the Corporation elects in writing that the
Companies will pay such expense.
(b) Each Company at the direction of the Corporation shall indemnify, to
the extent permissible under the law and consistent with such
Corporation's charter and by-laws, such member of the Plan Committee
from and against any liability, assessment, loss, expense or other
cost, of any kind or description whatsoever, including legal fees and
expenses, actually incurred by him or her on account of any action or
proceeding, actual or threatened, which arises as a result of being a
member of the Plan Committee, provided such action or proceeding does
not arise as a result of his or her own negligence, willful misconduct
or lack of good faith, and such expense is not an expense of the Trust
Fund.
79
SECTION XII - ADMINISTRATION OF THE TRUST FUND
----------------------------------------------
12.1 Appointment of Trustee. The Board shall appoint the initial Trustee to
administer all contributions paid into the Trust Fund. Such Trustee or
Trustees shall serve at the pleasure of the Plan Committee except that the
Trustee may also be replaced by the Board. The Trustee shall have such
rights, powers and duties as are contained in the Trust Agreement.
12.2 Management of Fund. All contributions to the Plan in cash shall be paid
over to the Trustee and all Company contributions to the Plan in the form
of Employer Stock shall be delivered to the Trustee. All contributions
shall be invested and managed upon such terms and in such manner as set
forth in the Plan and Trust Agreements.
12.3 Investment of Fund. Except with respect to Participant directed investments
pursuant to paragraphs 8.3, 8.4 and 8.6, the Trustee's investment policy
for the Trust Fund shall be to invest primarily in Employer Stock in
accordance with the Trust Agreement. In this regard, the Trustee, or its
designated agent, may receive Employer Stock from the Corporation or it may
purchase Employer Stock from the Corporation or on the open market. The
Trustee shall invest and protect any other assets of the Trust Fund in
accordance with the Trust Agreement.
12.4 Voting Employer Stock. All Employer Stock (including fractional shares)
allocated to a Participant's account shall be voted by the Trustee, in
accordance with instructions from such Participant. The Company shall
provide Participants with notices and information statements when voting
rights are to be exercised, the content of which must generally be the same
as for all holders of Employer Stock. Fractional shares may be voted by the
Trustee on a combined basis, in order to reflect the direction of the
Participants holding such shares. Participants shall have the right to
determine confidentially whether shares held by them in the plan will be
tendered in a tender or exchange offer. The Trustee shall determine the
procedures that should be followed to insure such confidentiality. The
Company may solicit Participants under proxy provisions applicable to all
holders of Employer Stock. The Trustee shall vote any unallocated shares of
Employer Stock in accordance with the best interests of the Participants
and Beneficiaries. The Trustee shall refrain from voting allocated shares
of Employer Stock for which it has not received instructions from the
Participant to whose account the shares are allocated except to the extent
required by statute, regulation or other law.
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12.5 Loans Secured by Employer Stock. To the extent allowed by law, the Trustee
shall borrow money upon directions in writing from the Plan Committee,
provided the loan meets all of the requirements of this paragraph, this
Plan and ERISA. All loans to the Trust which are made or guaranteed by a
disqualified person must satisfy all requirements applicable to "exempt
loans" set forth in Section 4975(d)(3) of the Code and Section 54.4975-7(b)
of the Treasury Regulations and Section 408(b)(3) of ERISA and Section
2550.408b-3 of the Department of Labor Regulations, and all provisions of
those statutes or regulations which are applicable to Employer Stock which
have been purchased with the proceeds of such an Exempt Loan or which are
used as collateral for such an Exempt Loan shall be complied with. Prior to
entering into an Exempt Loan, the Trustee, or a special trustee appointed
by the Board specifically for the purpose, must determine that (1) the
Exempt Loan is primarily for the benefit of the Participants and
Beneficiaries, (2) at the time the Exempt Loan is made, the interest rate
for the loan and the price of the Employer Stock to be acquired with the
loan proceeds should not be such that Plan assets might be drained off, and
(3) the Exempt Loan is at least as favorable to the Plan as the terms of a
comparable loan resulting from arm's-length negotiations between
independent parties. An Exempt Loan shall be for a specific term, shall
bear a reasonable rate of interest and shall not be payable on demand
except in the event of default. The proceeds of an Exempt Loan must be used
within a reasonable time after receipt only for the purpose of acquiring
Employer Stock, repaying the Exempt Loan or repaying a prior Exempt Loan.
An Exempt Loan may be secured by a collateral pledge of the Employer Stock
so acquired. No other Trust Fund assets may be pledged as collateral for an
Exempt Loan, and no lender shall have recourse against the Trust Fund other
than any Employer Stock remaining subject to pledge. Any pledge of Employer
Stock must provide for the release of shares so pledged on a pro-rata basis
pursuant to the provisions of Treasury Regulation Section 54.4975-7(b)(8)
as payments on the Exempt Loan are repaid by the Trustees and such Employer
Stock is allocated to Participants' accounts pursuant to paragraph 7.3(p).
In the event of default on an Exempt Loan, the value of Plan assets
transferred in satisfaction of the Exempt Loan must not exceed the amount
of such loan in default. If the lender is a "disqualified person," Plan
assets may be transferred upon default only upon and to the extent of the
81
failure of the Plan to meet the payment schedule of the loan. Repayments of
principal and interest on any Exempt Loan shall be made by the Trustee only
from Company Contributions and Matching Contributions paid in cash to
enable the Trustees to repay such Loan, from unallocated earnings
attributable to such Company Contributions and Matching Contributions and
from any cash dividends received by the Trust on unallocated Employer Stock
held in the Employer Stock Suspense Account. Except as provided in
paragraph 9.13 or as otherwise provided by applicable law, no Employer
Stock acquired with the proceeds of an Exempt Loan may be subject to a put,
call or other option, or buy-sell or similar arrangement while held by and
when distributed from the Plan and the protections and rights provided by
this sentence shall continue to be applicable after the repayment of the
Exempt Loan even if the Plan ceases to be an ESOP. In the event an Exempt
Loan is entered into and it is subsequently determined that such loan does
not comply with the requirements of Section 4975(d)(3) of the Code or the
Treasury Regulation issued thereunder or Section 408(b)(3) of ERISA or the
Labor Department Regulations issued thereunder for exempt loans to employee
stock ownership plans, the Corporation shall use all reasonable efforts to
bring the Exempt Loan into compliance with such provisions. If the
Corporation is unable to bring the Exempt Loan into compliance by
reasonable efforts, the Corporation may direct the Trustee in writing to
sell all or a part of the Employer Stock in the Employer Stock Suspense
Account (excluding any such stock that would be released if subparagraph
7.3(p) were applied immediately prior to such sale, which stock shall be
allocated to Participants at the end of the Plan Year pursuant to
subparagraph 7.3(f)) and to apply the proceeds of such sale to repay the
Exempt Loan. The Corporation and other Companies hereunder shall contribute
an amount necessary to pay any remaining balance due on such Exempt Loan.
To the extent permitted by paragraph 5.10, any excess cash proceeds from
such sale and any remaining Employer Stock in the Employer Stock Suspense
Account after complete repayment of the Exempt Loan to which it relates
shall be allocated proportionately to the Company Contribution Exempt Loan
cash subaccounts or the Company Contribution Exempt Loan Employer Stock
subaccount, respectively, of the Participants otherwise entitled to Company
Contributions for the Plan Year based upon each such Participant's Company
Contributions for the Plan Year to the total aggregate Company
Contributions of all such Participants for the Plan Year; provided,
82
however, that the total value of assets allocated pursuant to this sentence
may not exceed fifty percent (50%) of the Companies' total aggregate
Company Contributions for the Plan Year. Any remaining cash proceeds or
Employer Stock shall be allocated to the Company contribution Exempt Loan
cash subaccounts or Exempt Loan Employer Stock subaccounts of all
Participants who have not terminated Employment as of the last day of such
Plan Year for reasons other than death, Disability, or Retirement in
proportion to the ratio that each such Participant's Base Compensation
bears to the total aggregate Base Compensation for all such Participants.
In the event an Exempt Loan is entered into and it is subsequently
determined that a more favorable Exempt Loan can be obtained, the
Corporation may direct the Trustee in writing to renegotiate the Exempt
Loan provided the new loan is in the best interests of the Participants and
Beneficiaries, it qualifies as an Exempt Loan hereunder and meets all of
the requirements set forth hereunder. For purposes of this Section, the
term "disqualified person" means all persons constituting "disqualified
persons" pursuant to Section 4975(e)(2) of the Code or "parties in
interest" under Section 3(14) of ERISA; the term "loan" includes a direct
loan of cash, a purchase-money transaction, or an assumption of the
obligation of the Trust; and the term "guarantee" includes an unsecured
guarantee and the use of assets of a disqualified person as collateral for
a loan, even though the use of assets may not be a guarantee under
applicable state law.
12.6 Conversion of Employer Stock. Any Participant to whose account Employer
Stock, other than common stock, has been allocated may at any time file
with the Plan Committee written instructions in the form prescribed by the
Plan Committee, that all or any designated portion of said Employer Stock
be converted into common stock. Upon receipt of any such instructions, the
Plan Committee shall promptly so advise the Trustee. Thereupon the Trustee
shall promptly present the designated Employer Stock to the Corporation for
conversion in accordance with their terms. The common stock issued upon
conversion shall then be allocated to the account of the Participant
concerned. The Trustee shall effect conversions involving fractional
interests or fractional shares to the extent possible to reflect the
direction of the Participants holding such interests or shares.
83
12.7 Acceptance of Transfers and Rollover Contributions. The Trustee, subject to
Plan Committee approval, may accept funds transferred on behalf of a
Participant from another trust forming part of a tax-qualified employee
benefit plan or funds qualifying as a rollover contribution under Sections
408(d)(3) or 402(c) of the Code, provided that in the cases of a transfer
from such a trust, the trust from which such funds are transferred
specifically permits the transfer, the Trustee and Plan Committee are
satisfied that the transfer or rollover contribution will not jeopardize
the tax-qualified or exempt status of the Plan or Trust and the trust is
not part of a plan to which the annuity requirements of Sections 401(a)(11)
and 417 of the Code apply or, if such annuity requirements do apply, the
Plan Committee determines, based on evidence submitted by the Participant
that is satisfactory to the Plan Committee, that acceptance of the rollover
contribution will not cause this Plan to become subject to such annuity
rules. The Plan Committee shall develop such procedures, and may require
such information from a plan sponsor, Trustee or a Participant desiring to
make any transfer, as it deems necessary or desirable to determine that the
proposed transfer will meet the requirements of this paragraph. The Trustee
shall maintain a separate account for each Participant on whose behalf a
transfer or rollover contribution is accepted, which shall receive the
amount transferred or rolled over.
SECTION XIII - AMENDMENT OR TERMINATION OF THE PLAN
---------------------------------------------------
13.1 Right to Amend or Terminate the Plan. The Corporation expressly reserves
the right to amend, terminate or suspend the Plan at any time and in any
particular manner; provided, however, that no amendment or termination of
the Plan may be made which would permit any part of the assets of the Plan
to be used for, or diverted to, purposes other than for the exclusive
benefit of Participants and their Beneficiaries, or which would diminish
any rights accrued for the benefit of Participants or their Beneficiaries
prior to the effective date of the amendment. Without limiting the
foregoing provisions of this paragraph in any manner, the Corporation
expressly reserves the right to amend the contribution and allocation
provisions of this Plan at any time notwithstanding the fact that Employer
Stock is held in the Employer Stock Suspense Account on the effective date
of the amendment; provided, however, that any material amendment to the
contribution and allocation provisions that is adverse to any Participant
shall only become effective for Plan Years beginning after the date the
amendment is adopted unless the amendment is required to maintain the
Plan's status under Sections 401(a) or 4975(e)(7) of the Code. The Plan may
be amended, retroactively, however, if necessary, to conform the Plan to,
or satisfy the conditions of, any law, governmental regulation or ruling,
or to permit the Plan to meet the requirements of the Code or ERISA.
84
13.2 Continuance of Plan After Merger. The Plan shall not be automatically
terminated by the Corporation's or a Company's acquisition by or merger
with or into any other corporation or organization, but the Plan shall be
continued after such merger. All rights to amend, modify, suspend or
terminate the Plan may be transferred to the successor organization,
effective as of the day of the merger.
13.3 Distribution Upon Termination. In the event of the termination of the Plan
in whole or in part or upon the complete discontinuance of Company
contributions, the accounts of affected Participants shall continue to be
held in trust until payment at the time and in the manner prescribed in
Section IX.
13.4 Certain Sales. In the event that a Company sells all or substantially all
of the assets used in a trade or business and, as a result, a Participant
becomes an employee of the acquiring company, distribution of the
Participant's account balance shall be made in the manner prescribed in
Section IX hereof as soon as practicable following the date of sale. In the
event that all or substantially all of the stock of a Company is sold,
distribution of the Participant's account balance shall be made in the
manner prescribed in Section IX hereof as soon as practicable following the
date of sale, regardless of whether the Participant remains in the
employment of the Company or becomes an employee of the acquiring company.
SECTION XIV - MISCELLANEOUS
---------------------------
14.1 Facility of Payment. If any Participant, former Participant or Beneficiary,
in the judgment of the Trustee or the Plan Committee, is legally,
physically or mentally incapable of personally receiving and receipting for
any payment due hereunder, payment may be made to the guardian or other
legal representative of such Participant, former Participant or Beneficiary
or to such other person or institution who, in the opinion of the Trustee
or the Plan Committee, is then maintaining or has custody of such
Participant, former Participant or Beneficiary. Such payments shall
constitute a full discharge with respect to such payments. If the Trustee
has any question or doubt as to the proper party to receive a distribution,
the Trustee may ask the Plan Committee for written directions on the
distribution.
85
14.2 No Contractual Right to Benefits. The Plan shall not be deemed to
constitute a contract between any Company and any Participant or to be a
consideration for, or an inducement for the Employment of any Employee.
Nothing contained in the Plan shall be deemed to give any Employee the
right to be retained in the Service of any Company or to interfere with the
right of the Company to discharge any Employee at any time without regard
to the effect such discharge shall have upon him as a Participant in the
Plan.
14.3 Plan is Voluntary. While it is the intention of the Corporation that this
Plan and the Trust shall be continued and that the contribution of the
Corporation and Companies shall be made regularly each year, the Plan is
entirely voluntary on the part of the Corporation and each Company, and the
continuance of the Plan and Trust and the payments hereunder are not
assumed as a contractual obligation of the Corporation or any Company, and
each Company does not guarantee or promise to pay or cause to be paid any
of the benefits provided by the Plan. Each Participant or Beneficiary or
other person who shall claim the right to any payment of benefits under the
Plan and Trust shall be entitled to look only to the Trust Fund for such
payment and shall not have any right, claim or demand therefor against the
Corporation or any Company.
14.4 Nonalienation of Benefits. Any 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, prior to being actually received
by the person entitled to receive such benefits. Any attempt to anticipate,
alienate, sell, transfer, assign, pledge, encumber, charge or otherwise
dispose of any right to receive benefits payable under this Plan shall be
void. The Trust Fund shall not be liable in any manner for, or subject to,
the debts, contracts, liabilities, engagements or torts of any person
entitled to receive benefits under this Plan. Despite the general
nonalienation of benefits provision set forth above, the Plan shall provide
for the payment of benefits in accordance with the applicable requirements
of a Qualified Domestic Relations Order. For purposes of this paragraph, a
"Domestic Relations Order" means any judgment, decree, or order (including
approval of a property settlement agreement) which: (i) relates to the
provision of child support, alimony payments, or marital property rights to
a spouse, former spouse, child, or other dependent of a Participant, and
(ii) is made pursuant to a State domestic relations law (including
community property law). For purposes of this paragraph, a "Qualified
Domestic Relations Order" means a Domestic Relations Order, as defined
above, which:
86
(a) Creates or recognizes the existence of an Alternate Payee's right to,
or assigns to an Alternate Payee the right to, receive all or a
portion of the benefits payable with respect to a Participant under
the Plan,
(b) Clearly specifies:
(i) the name and the last known mailing address (if any) of the
Participant and the name and mailing address of each Alternate
Payee covered by the order,
(ii) the amount or percentage of the Participant's benefits to be paid
by the Plan to each such Alternate Payee, or the manner in which
such amount or percentage is to be determined,
(iii)the number of payments or period to which such order applies,
and
(iv) each plan to which such order applies,
(c) Does not require the Plan to provide any type or form of benefits, or
any option, not otherwise provided under the Plan,
(d) Does not require the Plan to provide increased benefits (determined on
the basis of actuarial value), and
(e) Does not require payment of benefits to an Alternate Payee which are
required to be paid to another Alternate Payee under another order
previously determined to be a Qualified Domestic Relations Order.
87
For purposes of this paragraph, the term "Alternate Payee" shall
mean any spouse, former spouse, child, or other dependent of a
Participant who is recognized by a Domestic Relations Order as
having a right to receive all, or a portion of, the benefits payable
under the Plan with respect to the Participant. In the case of any
Domestic Relations Order received by the Plan (i) the Plan Committee
shall promptly notify the Participant and any other Alternate Payee
of the receipt of such order and the Plan's procedures for
determining the qualified status of a Domestic Relations Order, and
(ii) within a reasonable period after receipt of such order, the
Plan Committee shall determine whether such order is a Qualified
Domestic Relations Order and notify the Participant and each
Alternate Payee of such determination. The Plan Committee shall
establish a reasonable procedure to determine the qualified status
of Domestic Relations Orders, and to administer distributions under
such qualified orders. Such procedures (i) shall be in writing, (ii)
shall provide for the notification of each person specified in a
Domestic Relations Order as entitled to payment of benefits under
the Plan (at the address included in the Domestic Relations Order)
of such procedures promptly upon receipt by the Plan of the Domestic
Relations Order, and (iii) shall permit an Alternate Payee to
designate a representative for receipt of copies of notices that are
sent to the Alternate Payee with respect to a Domestic Relations
Order. During any period in which the issue of whether a Domestic
Relations Order is a Qualified Domestic Relations Order is being
determined (by the Plan Committee, or by a court of competent
jurisdiction, or otherwise), the Plan Committee shall segregate in a
separate account of the Plan, or in an escrow account, the amounts
which would have been payable to the Alternate Payee during such
period if the order had been determined to be a Qualified Domestic
Relations Order. If within eighteen (18) months from the date of
receipt of the order (or modification thereof) by the Plan Committee
the same is determined to be a Qualified Domestic Relations Order,
the Plan Committee shall pay the segregated amount (plus any
interest thereon) to the person or persons entitled thereto. If
within the eighteen (18) months it is determined that the order is
not a Qualified Domestic Relations Order, or the issue as to whether
such order is a Qualified Domestic Relations Order is not resolved,
then the Plan Committee shall pay the segregated amounts (plus any
interest thereon) to the person or persons who would have been
entitled to such amounts if there had been no order. Any
determination that an order is a Qualified Domestic Relations Order
which is made after the close of the eighteen (18) month period
shall be applied prospectively only. If the Plan Committee or any
88
other Plan fiduciary treats a Domestic Relations Order as being (or
not being) a Qualified Domestic Relations Order, or takes action
under Section 206(d)(3)(H) of ERISA, then the Plan's obligation to
the Participant, a Surviving Spouse, and each Alternate Payee shall
be discharged to the extent of any payment made.
14.5 Controlling Law. The Plan shall be construed and interpreted in accordance
with the Code, ERISA and, to the extent not preempted, the laws of the
State of Georgia.
14.6 Terminology. Masculine pronouns used herein shall refer to men and women or
both, and nouns when stated in the singular shall include the plural and
when stated in the plural shall include the singular whenever appropriate.
Executed this 1st day of May, 1997.
ATTEST: SUNTRUST BANKS, INC.
By Ray Fortin By M. A. Eakens
__________________________ _________________________
Title CORP. SEC. Title GROUP VP-HR
_______________________ ______________________
(CORPORATE SEAL)
89
EXHIBIT A
TO THE
SUNTRUST BANKS, INC. 401(k) PLAN
As of January 1, 1997
SunTrust Banks, Inc.
SunTrust Securities, Inc.
SunTrust Service Corporation
STI Trust & Investment Operations, Inc.
SunTrust Capital Markets, Inc.
SunTrust International Services
SunTrust Mortgage, Inc.
SunTrust Banks of Georgia, Inc.
SunTrust Bank, Atlanta
SunTrust Bank, South Georgia, N.A.
SunTrust Bank, Northeast Georgia, N.A.
SunTrust Bank, Augusta, N.A.
SunTrust Bank, Southeast Georgia, N.A.
SunTrust Bank, West Georgia, N.A.
SunTrust Bank, Middle Georgia, N.A.
SunTrust Bank, Northwest Georgia, N.A.
SunTrust Bank, Savannah, N.A.
Personal Express Loans, Inc.
TRUSCO Capital Management
STI Credit Corporation
SunTrust Banks of Florida, Inc.
SunTrust Bank, North Central Florida
SunTrust Bank, Gulf Coast
SunTrust Bank, North Florida, N.A.
SunTrust Bank, West Florida
SunTrust Bank, Mid-Florida, N.A.
SunTrust Bank, East Central Florida
SunTrust Bank, Treasure Coast, N.A.
SunTrust Bank, Nature Coast
SunTrust Bank, Southwest Florida
SunTrust Bank, Central Florida, N.A.
SunTrust Bank, South Florida, N.A.
SunTrust Bank, Tampa Bay
SunTrust Bank, Miami, N.A.
STB Management (South FL), Inc.
SunTrust Bank, Tallahassee, N.A.
Premium Assignment Corporation
SunTrust BankCard, N.A.
STI Capital Management, N.A.
SunTrust Banks of Tennessee, Inc.
SunTrust Bank, Nashville, N.A.
SunTrust Bank, South Central Tennessee, N.A.
SunTrust Bank, East Tennessee, N.A.
Sun Trust Bank, Chattanooga, N.A.
SunTrust Bank, Northeast Tennessee
SunTrust Bank, Alabama, N.A.
EXHIBIT B
TO THE
SUNTRUST BANKS, INC. 401(k) PLAN
FORMER VENICE EMPLOYEES
-----------------------
APPLICATION
-----------
This Exhibit B shall be effective as of January 1, 1993. For purposes of this
Exhibit B, the term "Former Venice Participant" means a person who was at any
time a Participant of the Florida Westcoast Banks, Inc. Employee Stock Bonus
Plan (the "Venice Plan") provided the individual has an account balance in the
Venice Plan as of December 31, 1992 or is entitled by law to have this Plan
reestablish a prior forfeiture under the Venice Plan due to reemployment by the
Company after January 1, 1993. This Exhibit B shall only apply to a Former
Venice Participant and, if applicable, to any individual who would have become a
participant in the Venice Plan on January 1, 1993 if the Venice Plan had
remained in existence on that date.
Paragraph 3.1
PARTICIPATION
-------------
In addition to the provisions of paragraph 3.1 of the SunTrust Banks, Inc.
401(k) Plan (the "Plan"), each Former Venice Participant who is an actively
employed Employee on January 1, 1993 shall be a Participant in this Plan on
January 1, 1993. In addition, each individual who is an actively employed
Employee on January 1, 1993 and who would have become a participant in the
Venice Plan on January 1, 1993 if the Venice Plan had remained in existence on
that date shall be a Participant in this Plan on January 1, 1993.
Sections VI and VII
VESTING, ACCOUNTS AND ALLOCATIONS
---------------------------------
Employer contributions allocated to Subfund A (ESOP contributions) and Subfund B
(leveraged ESOP contributions) of the Venice Plan which are subject to the five
(5) year cliff vesting schedule set forth in Section 10.02 of the Venice Plan
along with Venice Plan earnings on such amounts shall be held in a Company
Contribution account hereunder, and referred to as the Venice Participant
Company Contribution account, which shall be
separate from such Employee's Company Contribution account for discretionary
Company contributions allocated under this Plan. The Venice Participant Company
Contribution account shall be subject to the vesting table set forth in
paragraph 6.2 hereunder with credit to the Venice Participant for all prior
vesting service credited under the Venice Plan. Employer contributions allocated
to Subfund C (tax credit ESOP contributions) of the Venice Plan along with
Venice Plan earnings on such amounts shall be fully vested and shall be held in
a PAYSOP account hereunder.
Paragraphs 8.6 and 8.7
DIVERSIFICATION RIGHTS OF QUALIFIED PARTICIPANTS
------------------------------------------------
In addition to the diversification rights of participants as stated in
paragraphs 8.6 and 8.7, each "qualified participant" may elect within ninety
(90) days after the close of each Plan Year during the "qualified election
period" to direct the Trustee in writing as to the distribution in cash and/or
Employer Stock of 25 percent of the total number of shares of Employer Stock
acquired by or contributed to the Venice Plan or the Plan after December 31,
1986 that have ever been allocated to such qualified participant's Venice
Participant Company Contribution Employer Stock subaccount (as defined in this
Exhibit B) and PAYSOP Employer Stock subaccount (reduced by the number of such
shares of Employer Stock previously distributed in cash and/or Employer Stock
pursuant to a prior election). In the case of the election year in which the
Participant can make his last election, the preceding sentence shall be applied
by substituting "50 percent" for "25 percent." If the "qualified participant"
elects to direct the Trustee as to the distribution of his Venice Participant
Company Contribution Employer Stock subaccount and PAYSOP Employer Stock
subaccount, such direction shall be effective no later than 180 days after the
close of the Plan Year to which such direction applies. In lieu of directing the
Trustee as to the investment of such subaccounts, the "qualified participant"
may elect a distribution in cash or Employer Stock of the portion of such
subaccounts covered by the election within ninety (90) days after the 1st day of
the period during which the election can be made. If Employer Stock subject to
the restrictions of Section 409(d) of the Code regarding the eighty-four (84)
month holding rule for a PAYSOP are subject to diversification pursuant to this
Exhibit "B", then stock meeting the eighty-four (84) month rule shall be subject
to diversification first, and thereafter stock still subject to the holding
period shall be diversified in the order of shares which have been held in the
Trust for the longest period of time.
Notwithstanding the above, if the fair market value (determined at the Valuation
Date immediately preceding the first day on which a "qualified participant" is
eligible to make an election)
2
of Employer Stock acquired or contributed to the Venice Plan or the Plan after
December 31, 1986 and allocated to a "qualified participant's" Venice
Participant Company Contribution Employer Stock subaccount and PAYSOP Employer
Stock subaccount is $500 or less, then such Employer Stock shall not be subject
to this paragraph.
For the purposes of this section the following definitions shall apply:
(1) "qualified participant" means any Former Venice Participant who has
completed ten (10) Plan Years of Service as a Participant under the
Venice Plan and/or the Plan and has attained age 55.
(2) "qualified election period" means the six (6) Plan Year period
beginning with the Plan Year in which the Former Venice Participant
first became a "qualified participant" or, if later, the six (6)
Plan Year period beginning January 1, 1987.
Paragraph 9.7
CONSENT TO DISTRIBUTION PRIOR TO AGE SIXTY-TWO
----------------------------------------------
Notwithstanding the provisions of paragraph 9.7, unless the provisions of
paragraph 9.8 apply, no distribution of benefits may commence to a Former Venice
Participant prior April 1 of the year following the year such Former Venice
Participant attains age 70 1/2 unless the Former Venice Participant provides
written consent to the commencement of the distribution.
3
EXHIBIT C
TO THE
SUNTRUST BANKS, INC. 401(k) PLAN
FORMER HOMETRUST EMPLOYEES
--------------------------
APPLICATION
-----------
This Exhibit C shall be effective as of January 1, 1993. For purposes of this
Exhibit C, the term "Former HomeTrust Participant" means a person who was at any
time a Participant of the Home Federal Savings Bank of Georgia Employee Stock
Ownership Plan (the "HomeTrust Plan") provided the individual has an account
balance in the HomeTrust Plan as of December 31, 1992 or is entitled by law to
have this Plan reestablish a prior forfeiture under the HomeTrust Plan due to
reemployment by the Company after January 1, 1993. This Exhibit C shall only
apply to a Former HomeTrust Participant and, if applicable, to any individual
would have become a participant in the HomeTrust Plan on January 1, 1993 if the
HomeTrust Plan had remained in existence on that date.
Paragraph 3.1
PARTICIPATION
-------------
In addition to the provisions of paragraph 3.1 of the SunTrust Banks, Inc.
401(k) Plan (the "Plan"), each Former HomeTrust Participant who is an actively
employed Employee on January 1, 1993 shall be a Participant in this Plan on
January 1, 1993. In addition, each individual who is an actively employed
Employee on January 1, 1993 and who would have become a Participant in the
HomeTrust Plan on January 1, 1993 if the HomeTrust Plan had remained in
existence on that date shall be a Participant in this Plan on January 1, 1993.
Sections VI and VII
VESTING, ACCOUNTS AND ALLOCATIONS
---------------------------------
"Before-Tax Contributions" to the HomeTrust Plan, as defined therein plus
earnings thereon shall be held in an Elective Contribution account hereunder.
"Employer Matching Contributions" to the HomeTrust Plan plus earnings thereon
shall be held in a Matching Contribution account. "Employer Base Contributions"
to the HomeTrust Plan plus earnings thereon shall be held in a Company
Contribution Exempt Loan subaccount.
"Employer Discretionary Contributions" under the HomeTrust Plan plus earnings
thereon shall be held in a Company Contribution subaccount hereunder. All
accounts which receive funds from the HomeTrust Plan shall be fully vested at
all times.
Paragraph 9.7
CONSENT TO DISTRIBUTION PRIOR TO AGE SIXTY-TWO
----------------------------------------------
Notwithstanding the provisions of paragraph 9.7, unless the provisions of
paragraph 9.8 apply, no distribution of benefits may commence to a Former
HomeTrust Participant prior to the date such Former HomeTrust Participant
attains age 65 unless the Former HomeTrust Participant provides written consent
to the commencement of the distribution.
2
EXHIBIT D
TO THE
SUNTRUST BANKS, INC. 401(k) PLAN
FORMER FLORENCE EMPLOYEES
-------------------------
APPLICATION
-----------
This Exhibit D shall be effective as of July 1, 1993. For purposes of this
Exhibit D, the term "Former Florence Participant" means a person who was at any
time a Participant of the Employees' Retirement Savings Plan of the First
National Bank of Florence (the "Florence Plan") provided the individual has an
account balance in the Florence Plan as of June 30, 1993 or is entitled by law
to have this Plan reestablish a prior forfeiture under the Florence Plan due to
reemployment by the Company after June 30, 1993. This Exhibit D shall only apply
to a Former Florence Participant and, if applicable, to any individual who would
have become a participant in the Florence Plan on July 1, 1993 if the Florence
Plan had remained in existence on that date.
Paragraph 3.1
PARTICIPATION
-------------
In addition to the provisions of Paragraph 3.1 of the SunTrust Banks, Inc.
401(k) Plan (the "Plan"), each Former Florence Participant who is an actively
employed Employee on July 1, 1993 shall be a Participant in this Plan on July 1,
1993. In addition, each individual who is an actively employed Employee on July
1, 1993 and who would have become a Participant in the Florence Plan on July 1,
1993 if the Florence Plan had remained in existence on that date shall be a
Participant in this Plan on July 1, 1993.
Sections VI and VII
VESTING, ACCOUNTS AND ALLOCATIONS
---------------------------------
"Elective Contributions" to the Florence Plan, as defined therein plus earnings
thereon shall be held in the Elective Contribution account hereunder. "Matching
Contributions" to the Florence Plan plus earnings thereon shall be held in the
Employee's Matching Contribution account for Matching Contributions allocated
under this Plan. "Discretionary Contributions" under the Florence Plan plus
earnings thereon shall be held in the Company Contribution
subaccount hereunder. Voluntary Savings Contributions" to the Florence Plan plus
earnings thereon shall be held in a Voluntary Contribution Account hereunder.
"Related Rollover Contributions" made to the Florence Plan plus earnings thereon
shall be separately identified from other rollover amounts and held in a
Participant rollover account hereunder. "Unrelated Rollover Contributions" to
the Florence Plan plus earnings thereon shall be held in a Participant rollover
account hereunder and commingled with any additional rollover contributions
(other than "Related Rollover Contributions") allocated to this Plan. All
accounts which receive funds from the Florence Plan shall be fully vested at all
times.
Paragraph 9.3
PAYMENT OPTIONS
---------------
(a) Notwithstanding the provisions of Paragraph 9.3 of the Plan, a Former
Florence Plan Participant may elect to receive a portion of his or her
distribution in a lump sum distribution and to receive the remaining
portion of the distribution in installment payments otherwise allowed
under Paragraph 9.3 of the Plan.
(b) "Related Rollover Contributions" made to the Florence Plan and held in
Florence Participant Related rollover accounts shall be subject to the
following Qualified Joint and Survivor Annuity Rules:
(i) A Florence Participant Related rollover account shall be payable
only in the form of a Qualified Joint and Survivor Annuity unless,
within the ninety (90) day period ending on the annuity starting
date, the Participant elects another form of payment with the
consent of his or her spouse (if applicable) as described below. A
"Qualified Joint and Survivor Annuity" is an immediate annuity for
the life of the Participant with a survivor annuity for the life of
his or her surviving spouse which is equal to one half (1/2) of the
annuity payable during the joint lives of the Participant and his
or her spouse. (In the case of an unmarried Participant, a
"Qualified Joint and Survivor Annuity" is a single life annuity.)
(ii) If a married Participant dies prior to his or her annuity starting
date, the Plan Committee will direct the Trustee to distribute the
Participant's vested benefit to the Participant's surviving spouse
in the form of a Preretirement Survivor Annuity, unless the
Participant has a valid waiver election in effect which waives the
Preretirement Survivor Annuity, with
2
appropriate spousal consent, or unless the Participant and his or
her spouse were not married throughout the one (1) year period
ending on the date of his or her death. A "Preretirement Survivor
Annuity" is an annuity which is purchased with 100% of the
Participant's vested benefit (determined as of the date of the
Participant's death) and which is payable for the life of the
Participant's surviving spouse. If the present value of the
Preretirement Survivor Annuity does not exceed $3,500, the Plan
Committee, on or before the annuity starting date, must direct the
Trustee to make a lump sum distribution to the Participant's
surviving spouse, in lieu of a Preretirement Survivor Annuity. This
section applies only to a Participant who dies after August 22,
1984, and either (i) completes at least one (1) Hour of Service 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 of Service with the Employer in a Plan Year beginning after
December 31, 1975.
If the present value of the Preretirement Survivor Annuity exceeds
$3,500, the Participant's surviving spouse may elect to have the
Trustee commence payment of the Preretirement Survivor Annuity at
any time following the date of the Participant's death, but not
later than the mandatory distribution periods, and may elect any of
the forms of payment, in lieu of the Preretirement Survivor Annuity.
In the absence of an election by the surviving spouse, the Plan
Committee must direct the Trustee to distribute the Preretirement
Survivor Annuity on the first distribution date following the close
of the Plan Year in which the latest of the following events occurs:
(i) the Participant's death; (ii) the date the Plan Committee
receives notification of or otherwise confirms the Participant's
death; (iii) the date the Participant would have attained Normal
Retirement Age; or (iv) the date the Participant would have attained
age 62.
If the Participant has in effect a valid waiver election regarding
the Qualified Joint and Survivor Annuity or the Preretirement
Survivor Annuity, the Plan Committee must direct the Trustee to
distribute the Participant's vested benefit. The Plan Committee will
reduce the Participant's vested benefit by any security interest
held by the Plan by reason of a Participant loan to determine the
value of the Participant's vested benefit distributable in the
form of a Qualified Joint and Survivor Annuity or Preretirement
Survivor Annuity, provided any post-August 18, 1985, loan satisfied
the
3
spousal consent requirement of the Plan. For purposes of applying
this section, the Plan Committee treats a former spouse as the
Participant's spouse or surviving spouse to the extent provided
under a "Qualified Domestic Relations Order" defined by the Internal
Revenue Code. The provisions of this section apply separately to the
portion of the Participant's vested benefit subject to the Qualified
Domestic Relations Order and to the portion of the Participant's
vested benefit not subject to that order.
The consent of the spouse of the Participant to payment in a form
other than a Qualified Joint and Survivor Annuity and/or to a
Beneficiary other than the spouse must be in writing and witnessed
by a notary public and must acknowledge the effect of the election
and consent. The Plan Committee may accept an election by a
Participant to receive benefits in a form other than a Qualified
Joint and Survivor Annuity if it is established to the satisfaction
of the Plan Committee that there is no spouse, the spouse cannot be
located, or such other circumstances as may be prescribed by
Treasury Regulations. Any spousal consent shall only be applicable
to the spouse granting such consent.
No less than thirty (30) and no more than ninety (90) days before
the "Annuity Starting Date", each Participant and his or her spouse
(if applicable) shall be given a written notice to the effect that
benefits attributable to his or her Florence Participant Related
rollover account shall be payable in the form of a "Qualified
Joint and Survivor Annuity" unless the Participant, with the consent
of the spouse (if applicable), elects another form of benefit
payment prior to the Annuity Starting Date. The notice shall
describe, in a manner intended to be understood by the Participant
and the spouse, the terms and conditions of the Qualified Joint and
Survivor Annuity and shall include a general explanation of the
financial effects of an election or absence of an election to choose
another payment form. As used in this paragraph, "Annuity Starting
Date" means the first day of the first period for which an amount is
to be paid as an annuity or in any other form. The Plan Committee
must provide a written explanation of the Preretirement Survivor
Annuity to each married Participant, within the following period
which ends last: (1) the period beginning on the first day of the
Plan Year in which the Participant attains age thirty-two (32) and
ending on the last day of the Plan Year in which the Participant
attains age thirty-four (34); (2) a reasonable period after an
Employee becomes a
4
Participant; or (3) a reasonable period after the Qualified Joint
and Survivor Annuity rules become applicable to the Participant. A
reasonable period described in clauses (2), and (3) is the period
beginning one year before and ending one year after the applicable
event. If the Participant separates from service before attaining
age thirty-five (35), clauses (1), (2) and (3) do not apply and the
Plan Committee must provide the written explanation within the
period beginning one year before and ending one year after the
separation from service. The written explanation must describe, in a
manner consistent with Treasury Regulations, the terms and
conditions of the Preretirement Survivor Annuity comparable to the
explanation of the Qualified Joint and Survivor Annuity. The Plan
does not limit the number of times the Participant may revoke a
waiver of the Preretirement Survivor Annuity or make a new waiver
during the election period.
A Participant's waiver election of the Preretirement Survivor
Annuity is not valid unless (a) the Participant makes the waiver
election no earlier than the first day of the Plan Year in which he
attains age thirty-five (35) and (b) the Participant's spouse (to
whom the Preretirement Survivor Annuity is payable) satisfies the
consent requirements, except the spouse need not consent to the form
of benefit payable to the designated Beneficiary. The spouse's
consent to the waiver of the Preretirement Survivor Annuity is
irrevocable, unless the Participant revokes the waiver election.
Irrespective of the time of election requirement described in clause
(a), if the Participant separates from Service prior to the
first day of the Plan Year in which he attains age thirty-five (35),
the Plan Committee will accept a waiver election as respects the
Participant's vested benefit attributable to his service prior to
his separation from service. Furthermore, if a Participant who has
not separated from service makes a valid waiver election, except for
the timing requirement of clause (a), the Plan Committee will accept
that election as valid, but only until the first day of the Plan
Year in which the Participant attains age thirty-five (35). A waiver
election described in this paragraph is not valid unless made after
the Participant has received the written explanation.
5
A Participant, with the consent of his or her spouse, may elect on
forms provided by the Plan Committee that in the event of the
Participant's death, the Participant's Related rollover account
shall be paid in accordance with paragraph 9.3 in lieu of the
Preretirement Survivor Annuity, subject to the notice, election and
spousal consent rules set forth above.
Spousal consent is secured for a specific election only and such
election may not be changed without obtaining a new spousal consent.
Paragraph 9.7
CONSENT TO DISTRIBUTION PRIOR TO AGE SIXTY-TWO
----------------------------------------------
Notwithstanding the provisions of paragraph 9.7, unless the provisions of
paragraph 9.8 apply, no distribution of benefits may commence to a Former
Florence Participant prior to the date such Former Florence Participant attains
age 65 unless the Former Florence Participant provides written consent to the
commencement of the distribution.
6
EXHIBIT "E"
TO THE
SUNTRUST BANKS, INC. 401(k) PLAN
FORMER KEY BISCAYNE BANK & TRUST COMPANY EMPLOYEES
--------------------------------------------------
APPLICATION
-----------
For purposes of this Exhibit "E," the term "Former Key Biscayne Participant"
means a person who was at any time a Participant of the Key Biscayne Bank 401(k)
Profit Sharing Plan (the "Key Biscayne Plan") provided the individual had an
account balance in the Key Biscayne Plan as of January 1, 1996 or is entitled by
law to have the Key Biscayne Plan or the SunTrust Plan reestablish a prior
forfeiture under the Key Biscayne Plan due to reemployment. This Exhibit "E"
shall only apply to a Former Key Biscayne Participant and, if applicable, to any
individual who would have become a participant in the Key Biscayne Plan on
January 1, 1996, if the Key Biscayne Plan had remained in existence on that
date.
Paragraph 3.1
PARTICIPATION
-------------
In addition to the provisions of Paragraph 3.1 of the SunTrust Plan, each Former
Key Biscayne Participant who is actively employed on January 1, 1996, shall be a
Participant in the SunTrust Plan on January 1, 1996. In addition, each
individual who would have become a Participant in the Key Biscayne Plan on
January 1, 1996, if the Key Biscayne Plan had remained in existence on that date
shall be a Participant in the SunTrust Plan on January 1, 1996.
Sections VI and VII
VESTING, ACCOUNTS AND ALLOCATIONS
---------------------------------
"Salary Reduction Contributions" to the Key Biscayne Plan, as defined therein
plus earnings thereon shall be held in an "Elective Contributions Account"
hereunder. "Matching Contributions" to the Key Biscayne Plan plus earnings
thereon shall be held in a "Matching Contribution Account" hereunder. "Employer
Contributions" under the Key Biscayne Plan plus earnings thereon shall be held
in a "Company Contributions Account". "Voluntary After Tax Contributions" to the
Key Biscayne Plan plus earnings thereon shall be held in a "Voluntary
Contributions Account" hereunder. "Rollover Contributions" to the Key Biscayne
Plan plus earnings thereon shall be held in a "Participant Rollover Account"
hereunder. All accounts which receive funds from the Key Biscayne Plan shall be
fully vested at all times.
Paragraph 9.3
PAYMENT OPTIONS
---------------
(a) Notwithstanding the provisions of Paragraph 9.3 of the Plan, a Former
Key Biscayne Participant may elect to receive the distribution of all of
his or her benefits under the SunTrust Plan in any of the following
forms:
1
(i) one sum.
(ii) an annuity for the life of the Participant.
(iii) an annuity for the life of the Participant and upon his death
100% or 50% (whichever is specified when this option is elected)
of the annuity amount will be continued to his or her spouse as
his or her contingent annuitant. No further annuity benefits are
payable after the death of both the Participant and his or her
spouse.
(iv) an annuity for the joint lives of the Participant and his or her
spouse with 100% or 50% (whichever is specified when this option
is elected) of such amount payable as an annuity for life to the
survivor. No further benefits are payable after the death of both
the Participant and his or her spouse.
(v) an annuity for the life of the Participant with installment
payments for a period certain not longer than the life expectancy
of the Participant.
(b) With respect to all Former Key Biscayne Participants, all "Prior Plan
Accounts" established under the SunTrust Plan to identify accounts which
were established under the Key Biscayne Plan and all benefits accrued
under the SunTrust Plan for such participants shall be subject to the
following Qualified Joint and Survivor Annuity Rules:
(i) The "Prior Plan Accounts" referenced herein shall be payable only
in the form of a Qualified Joint and Survivor Annuity unless,
within the ninety (90) day period ending on the annuity starting
date, the Participant elects another form of payment with the
consent of his or her spouse (if applicable) as described below.
A "Qualified Joint and Survivor Annuity" is an immediate annuity
for the life of the Participant with a survivor annuity for the
life of his or her surviving spouse which is equal to one-half
(1/2) of the annuity payable during the joint lives of the
Participant and his or her spouse. (In the case of an unmarried
Participant, a "Qualified Joint and Survivor Annuity" is a single
life annuity.)
(ii) If a married Participant dies prior to his or her annuity
starting date, the Plan Committee will direct the Trustee to
distribute the Participant's vested benefit to the Participant's
surviving spouse in the form of a Preretirement Survivor Annuity,
unless the Participant has a valid waiver election in effect
which waives the Preretirement Survivor Annuity, with appropriate
spousal consent, or unless the Participant and his or her spouse
were not married throughout the one (1) year period ending on the
date of his or her death. A "Preretirement Survivor Annuity" is
an annuity which is purchased with 100% of the Participant's
vested benefit (determined as of the date of the Participant's
death) and which is payable for the life of the Participant's
surviving spouse. If the present value of the Preretirement
Survivor Annuity does not exceed $3,500, the Plan Committee, on
or before the annuity starting date, must direct the Trustee to
make a lump sum distribution to the Participant's surviving
spouse, in lieu of a Preretirement Survivor Annuity. This section
applies only to a Participant who dies after August 22, 1984, and
either (i) completes at least one (1) Hour of Service 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 (l) Hour of Service with the Employer in a Plan Year
beginning after December 31, 1975.
If the present value of the Preretirement Survivor Annuity
exceeds $3,500, the Participant's surviving spouse may elect to
have the Trustee commence payment of the Preretirement Survivor
Annuity at any time following the date of the Participant's
death, but not later than the mandatory distribution periods, and
may elect any of the forms of payment in lieu of the
2
Preretirement Survivor Annuity. In the absence of an election by the
surviving spouse, the Plan Committee must direct the Trustee to
distribute the Preretirement Survivor Annuity on the first distribution
date following the close of the Plan Year in which the latest of the
following events occurs: (i) the Participant's death; (ii) the date the
Plan Committee receives notification of or otherwise confirms the
Participant's death; (iii) the date the Participant would have attained
Normal Retirement Age; or (iv) the date the Participant would have
attained age 62.
If the Participant has in effect a valid waiver election regarding the
Qualified Joint and Survivor Annuity or the Preretirement Survivor
Annuity, the Plan Committee must direct the Trustee to distribute the
Participant's vested benefit. The Plan Committee will reduce the
Participant's vested benefit by any security interest held by the Plan
by reason of a Participant loan to determine the value of the
Participant's vested benefit distributable in the form of a
Qualified Joint and Survivor Annuity or Preretirement Survivor Annuity,
provided any post-August 18, 1985, loan satisfied the spousal consent
requirement of the Plan. For purposes of applying this section, the Plan
Committee treats a former spouse as the Participant's spouse or
surviving spouse to the extent provided under a "Qualified Domestic
Relations Order" defined by the Internal Revenue Code. The provisions
of this section apply separately to the portion of the Participant's
vested benefit subject to the Qualified Domestic Relations Order
and to the portion of the Participant's vested benefit not subject to
that order.
The consent of the spouse of the Participant to payment in a form other
than a Qualified Joint and Survivor Annuity and/or to a Beneficiary
other than the spouse must be in writing and witnessed by a notary
public and must acknowledge the effect of the election and consent. The
Plan Committee may accept an election by a Participant to receive
benefits in a form other than a Qualified Joint and Survivor Annuity if
it is established to the satisfaction of the Plan Committee that there
is no spouse, the spouse cannot be located, or such other circumstances
as may be prescribed by Treasury Regulations. Any spousal consent shall
only be applicable to the spouse granting such consent.
No less than thirty (30) and no more than ninety (90) days before the
"Annuity Starting Date," each Former Key Biscayne Participant and his or
her spouse (if applicable) shall be given a written notice to the effect
that benefits under the SunTrust Plan, including his or her Key Biscayne
Prior Plan Account, shall be payable in the form of a "Qualified Joint
and Survivor Annuity" unless the Participant, with the consent of the
spouse (if applicable), elects another form of benefit payment prior to
the Annuity Starting Date. The notice shall describe, in a manner
intended to be understood by the Participant and the spouse, the terms
and conditions of the Qualified Joint and Survivor Annuity and shall
include a general explanation of the financial effects of an election or
absence of an election to choose another payment form. As used in this
paragraph, "Annuity Starting Date" means the first day of the first
period for which an amount is to be paid as an annuity or in any other
form. The Plan Committee must provide a written explanation of the
Preretirement Survivor Annuity to each such married Participant within
the following period which ends last: (1) the period beginning on the
first day of the Plan Year in which the Participant attains age
thirty-two (32) and ending on the last day of the Plan Year in which the
Participant attains age thirty-four (34); (2) a reasonable period after
an Employee becomes a Participant; or (3) a reasonable period after the
Qualified Joint and Survivor Annuity rules become applicable to the
Participant. A reasonable period described in clauses (2) and (3) is the
period beginning one year before and ending one year after the
applicable event. If the Participant separates from service before
attaining age thirty-five (35), clauses (1), (2) and (3) do not apply
and the Plan Committee must provide the written explanation within the
period beginning one year before and ending one year after the
separation from service. The written explanation must describe, in a
manner consistent with
3
Treasury Regulations, the terms and conditions of the Preretirement
Survivor Annuity comparable to the explanation of the Qualified Joint
and Survivor Annuity. The Plan does not limit the number of times the
Participant may revoke a waiver of the Preretirement Survivor Annuity or
make a new waiver during the election period.
A Former Key Biscayne Participant's waiver election of the Preretirement
Survivor Annuity is not valid unless (a) the Participant makes the
waiver election no earlier than the first day of the Plan Year in which
he attains age thirty-five (35) and (b) the Participant's spouse (to
whom the Preretirement Survivor Annuity is payable) satisfies the
consent requirements, except the spouse need not consent to the form of
benefit payable to the designated Beneficiary. The spouse's consent to
the waiver of the Preretirement Survivor Annuity is irrevocable, unless
the Participant revokes the waiver election. Irrespective of the time of
election requirement described in clause (a), if the Participant
separates from Service prior to the first day of the Plan Year in which
he attains age thirty-five (35), the Plan Committee will accept a waiver
election as respects the Participant's vested benefit attributable to
his service prior to his separation from service. Furthermore, if a
Participant who has not separated from service makes a valid waiver
election, except for the timing requirement of clause (a), the Plan
Committee will accept that election as valid, but only until the first
day of the Plan Year in which the Participant attains age thirty-five
(35). A waiver election described in this paragraph is not valid unless
made after the Participant has received the written explanation.
A Participant, with the consent of his or her spouse, may elect on forms
provided by the Plan Committee that in the event of the Participant's
death, the Participant's rollover account shall be paid in accordance
with paragraph 9.3 in lieu of the Preretirement Survivor Annuity,
subject to the notice, election and spousal consent rules set forth
above.
Spousal consent is secured for a specific election only and such
election may not be changed without obtaining a new spousal consent.
4
EXHIBIT "F"
TO THE
SUNTRUST BANKS, INC. 401(k) PLAN
FORMER PONTE VEDRA NATIONAL BANK EMPLOYEES
------------------------------------------
APPLICATION
-----------
For purposes of this Exhibit "F," the term "Former Ponte Vedra Participant"
means a person who was at any time a Participant of the Ponte Vedra National
Bank Retirement Savings Plan (the "Ponte Vedra Plan") provided the individual
had an account balance in the Ponte Vedra Plan as of April 1, 1996, or is
entitled by law to have the Ponte Vedra Plan or the SunTrust Plan reestablish a
prior forfeiture under the Ponte Vedra Plan due to reemployment. This Exhibit
"F" shall only apply to a Former Ponte Vedra Participant and, if applicable, to
any individual who would have become a participant in the Ponte Vedra Plan on
April 1, 1996, if the Ponte Vedra Plan had remained in existence on that date.
Paragraph 3.1
PARTICIPATION
-------------
In addition to the provisions of Paragraph 3.1 of the SunTrust Plan, each
Former Ponte Vedra Participant who is actively employed on April 1, 1996, shall
be a Participant in the SunTrust Plan on April 1, 1996. In addition, each
individual who would have become a Participant in the Ponte Vedra Plan on April
1, 1996, if the Ponte Vedra Plan had remained in existence on that date shall be
a Participant in the SunTrust Plan on April 1, 1996.
Sections VI and VII
VESTING, ACCOUNTS AND ALLOCATIONS
---------------------------------
"Salary Reduction Contributions" to the Ponte Vedra Plan, as defined therein,
plus earnings thereon shall be held in a "Prior Plan Elective Contributions
Account" hereunder. "Matching Contributions" to the Ponte Vedra Plan plus
earnings thereon shall be held in a "Prior Plan Matching Contribution Account"
hereunder. "Employer Contributions" under the Ponte Vedra Plan plus earnings
thereon shall be held in a "Prior Plan Company Contributions Account."
"Voluntary After Tax Contributions" to the Ponte Vedra Plan, if any, plus
earnings thereon shall be held in a "Post 1986 Voluntary Contributions Account"
hereunder. "Rollover Contributions" to the Ponte Vedra Plan plus earnings
thereon shall be separately identified from other rollover amounts and held in a
"Participant Rollover Account" hereunder. All accounts which receive funds from
the Ponte Vedra Plan shall be fully vested at all times.
Paragraph 9.7
CONSENT TO DISTRIBUTION PRIOR TO AGE SIXTY-TWO
----------------------------------------------
Notwithstanding the provision of paragraph 9.7, unless the provisions of
paragraph 9.8 apply, no distribution of benefits may commence to a Former Ponte
Vedra Participant prior to the date such Former Ponte Vedra Participant attains
age 65 unless the Former Ponte Vedra Participant provides written consent to the
commencement of the distribution.
FIRST AMENDMENT TO THE SUNTRUST BANKS, INC.
401(k) PLAN (Amended and Restated January 1, 1997)
WHEREAS, SunTrust Banks, Inc. (hereinafter referred to as the "Employer"),
heretofore established, and there is now existing, a cash or deferred profit
sharing plan known as the SunTrust Banks, Inc. 401(k) Plan (hereinafter referred
to as the "Plan"); and
WHEREAS, under the terms of the Plan, the Employer has reserved the
ability to amend the Plan; and
WHEREAS, the Employer desires to amend certain provisions of the Plan to
comply with the requirements of the Uniformed Services Employment and
Reemployment Rights Act of 1994 and with Revenue Procedure 96-55 pertaining to
prohibiting in service distributions of funds previously held in money purchase
pension plans.
NOW, THEREFORE, The Plan is hereby amended and modified as follows:
1. The provisions of Section IV of the Plan are hereby amended and
modified by the addition of new paragraph 4.9 as hereinafter set forth:
"4.9 Model Amendment for USERRA Service and Benefits Credit.
Notwithstanding any provision of this Plan to the contrary, on and after
December 12, 1994 contributions, benefits and service credit with respect
to qualified military service will be provided in accordance with Code
Section 414(u). Loan repayments will be suspended under this Plan as
permitted under code Section 414(u)(4)."
2. The provisions of Section IX of the Plan are hereby amended and
modified by the addition of new paragraph 9.14 as hereinafter set forth:
"9.47 Model Amendment Precluding In Service Distributions on Pension Plan
Assets. Notwithstanding any provision of this Plan to the contrary, on and
after March 12, 1995 to the extent that any optional form of benefit under
this Plan permits a distribution prior to the Employee's retirement,
death, disability, or severance from employment, and prior to plan
termination, the optional form of benefits is not available with respect
to benefits attributable to assets (including the post-transfer earnings
thereon) and liabilities that are transferred, within the meaning of Code
Section 14(l), to this Plan from a money purchase pension plan qualified
under Code Section 401(a) (other than any portion of those assets and
liabilities attributable to voluntary Employee contributions)."
3. This FIRST AMENDMENT TO THE SUNTRUST BANKS, INC. 401(k) PLAN shall be
effective as of December 12, 1994 for Paragraph 1 above and March 12, 1995 for
Paragraph 2.
IN WITNESS WHEREOF, the Employer has caused this First Amendment to be
executed by its duly authorized officers and its corporate seal to be hereto
affixed and attested.
EXECUTED this __27th______ day of ____June___________________, 1997.
SUNTRUST BANKS, INC. ATTEST
BY: Ray Fortin BY: M. H. Ekins
------------------ ----------------------
Title: Corp. Sec. Title: Group V.P.--H.R.
------------------ ----------------------
SECOND AMENDMENT TO THE SUNTRUST BANKS, INC.
401(k) PLAN (Amended and Restated January 1, 1997)
WHEREAS, SunTrust Banks, Inc. (hereinafter referred to as the "Employer"),
heretofore established, and there is now existing, a cash or deferred profit
sharing plan known as the SunTrust Banks, Inc. 401(k) Plan (hereinafter referred
to as the "Plan"); and
WHEREAS, under the terms of the Plan, the Employer has reserved the
ability to amend the Plan; and
WHEREAS, the Employer desires to amend certain provisions of the Plan to
allow Participants to make Elective Contributions of two (2) percent up to
fifteen (15) percent and to provide for automatic lump sum payments to
Participants who are entitled to distribution upon disability, retirement or
termination of employment and whose balance does not exceed Five Thousand
Dollars ($5,000) pursuant to the Taxpayer Relief Act of 1997.
NOW, THEREFORE, the Plan is hereby amended and modified as follows:
1. Paragraph 4.2 of Section IV is hereby amended and modified to
read as follows:
"4.2 Elective Contributions. As of any Entry Date, a Participant
may, pursuant to a Compensation Deferral Agreement, direct the
Company to contribute Elective Contributions from the Participant's
Base Compensation to the Participant's Elective Contribution
subaccount in the amount of 2%, 3%, 4%, 5%, 6%, 7%, 8%, 9%, 10%,
11%, 12%, 13%, 14% or 15% of the amount of Base Compensation paid
during the pay period provided that the aggregate Elective
Contribution for any Participant for any calendar year may not
exceed Seven Thousand Dollars ($7,000), as adjusted by the Treasury
Department pursuant to Section 402(g) of the Code for cost of living
changes. Notwithstanding the provisions of the prior sentence,
during the Plan Year, and as often as deemed necessary, the Plan
Committee may (a) limit the percentage of Base Compensation that a
Highly Compensated Active Participant may defer to any rate less
than 15% of his Base Compensation, (b) limit the percentage of Base
Compensation deferred by all Highly Compensated Active Participants
who earn in excess of an amount of Base Compensation selected by the
Plan Committee, (c) for future pay periods may limit the maximum
dollar amount that a Highly Compensated Active Participant may defer
during a Plan Year or (d) a combination of the methods set forth
above, if the Plan Committee determines that such action may be
necessary to satisfy either of the tests set forth in paragraph 5.1.
After having made such a limitation regarding Highly Compensated
Active Participants, the Plan Committee may later raise the then
permitted percentage of Base Compensation or dollar amount
contributed as Elective Contributions on behalf of Highly
Compensated Active Participants if the Plan Committee determines
that the earlier reduction in the maximum contribution rate or
dollar amount for Highly Compensated Active Participants was not
necessary to satisfy either of the tests set forth in paragraph 5.1.
Elective Contributions shall be made on a payroll deduction basis
each pay period."
2. Paragraph 9.1 of Section IX is hereby amended and modified to
read as follows:
"9.1 Distributions Upon Disability, Retirement or Termination of
Employment. Subject to the provisions of paragraphs 9.2, 9.3 and
9.9, a Participant's Total Account will be distributed to him or her
in accordance with paragraph 9.2 upon filing a written election
following his or her Disability or termination of service with the
Company and all Affiliates due to Retirement or any other reason. If
a Participant's Employment is terminated by death, or if he or she
dies after termination but before complete distribution of the
account, his or her account (or the undistributed balance thereof)
will be distributed to the Beneficiary following receipt of a
written election, subject to the provisions of paragraph 9.10. If a
Participant or Beneficiary is entitled to receive benefits from an
account that does not exceed Five Thousand Dollars ($5,000) in value
and the recipient does not file a written election for benefits
within forty-five (45) days of receipt of election forms,
distribution of benefits shall commence in accordance with the Plan
as soon as reasonably possible after the later of (i) forty-five
(45) days following delivery of the election forms or (ii)
completion of six (6) semi-monthly payroll periods following the
date the Participant terminated employment. If a terminated
Participant is age sixty-two (62) or older and he or she does not
file a written election for benefits within forty-five (45) days of
receipt of election forms or, if later, by March 15 of the year
following (i) the year in which the Participant terminated
Employment or, if later (ii) the year in which they reach age
sixty-two (62), distribution of benefits shall commence in
accordance with the Plan as soon as reasonably possible thereafter
except as provided in paragraph 9.7 for distributions of Employer
Stock, or as provided in paragraph 9.2."
3. Paragraph 9.4 of Section IX is hereby amended and modified to
read as follows:
"9.4 Limited Lump-Sum Payments. Notwithstanding anything to the
contrary pertaining to the payment of benefits, a lump-sum payment
shall be made to any Participant, spouse or Beneficiary where, at
the time benefits commence, the fair market value of the Total
Account does not exceed Five Thousand Dollars ($5,000), and such
Participant, spouse or Beneficiary shall be paid a lump-sum amount
equal to his or her interest in the Plan, thereby relinquishing any
right or interest the recipient may have in any other payments
hereunder. Payment shall commence as of a Valuation Date that is as
soon as reasonably practicable following the date the Participant
terminates employment for any reason and payment shall otherwise be
made in accordance with this Section IX."
4. Paragraph 9.6 of Section IX is hereby amended and modified to
read as follows:
"9.6 Distribution to Alternate Payee Pursuant to a Qualified
Domestic Relations Order. Distribution of benefits to an Alternate
Payee pursuant to a Qualified Domestic Relations Order (as defined
in Section 414(p) of the Code and paragraph 14.4) may commence in
accordance with the distribution provisions of the Plan at any time
as specified by such Qualified Domestic Relations Order. In such
situations where the Alternate Payee's distribution occurs prior to
commencement of distributions to the Participant whose account is
subject to the Qualified Domestic Relations Order and prior to the
date the Participant attains his "earliest retirement age" (as
defined in Section 414(p)(4)(B) of the Code), the time and form of
payment shall be determined pursuant to the Plan as if the Alternate
Payee had been a Participant who terminated employment immediately
prior to the date of distribution specified in the Qualified
Domestic Relations Order. Notwithstanding the above, distribution of
benefits to an Alternate Payee shall not commence prior to the
earlier of (i) the date such Participant becomes eligible to receive
a distribution or (ii) the date such Participant attains the
"earliest retirement age" unless such Alternate Payee consents in
writing to such early distribution, or unless the present value of
the benefit to be paid to such Alternate Payee does not exceed Five
Thousand Dollars ($5,000)."
5. This SECOND AMENDMENT TO THE SUNTRUST BANKS, INC. 401(k) PLAN
shall be effective as of January 1, 1998.
IN WITNESS WHEREOF, the Employer has caused this Second Amendment to
be executed by its duly authorized officers and its corporate seal to be hereto
affixed and attested.
EXECUTED this 18th day of December, 1997.
ATTEST: SUNTRUST BANKS, INC.
By: __________________ By: ___________________
Title: __________________ Title: ___________________
Third Amendment to the SunTrust Banks, Inc.
401(k) Plan (Amended and Restated January 1, 1997)
WHEREAS, SunTrust Banks, Inc. (hereinafter referred to as the
"Employer"), heretofore established, and there is now existing, a cash or
deferred profit sharing plan known as the SunTrust Banks, Inc. 401(k) Plan
(hereinafter referred to as the "Plan"); and
WHEREAS, under the terms of the Plan, the Employer has reserved the
ability to amend the Plan; and
NOW, THEREFORE, The Plan is hereby amended and modified as follows:
1. Effective January 1, 1993, Paragraph 9.11(a) of Section IX is amended and
modified to read as follows:
"(a) If a Participant who is employed by a Company can demonstrate that
the condition of Hardship exists as determined by regulations established
by the Plan Committee, upon prior written notice to the Plan Committee, a
Participant may withdraw any portion of his (i) Elective Contributions
made on or after January 1, 1993 (but not the earnings thereon) and (ii)
Matching Contribution allocated to the Participant's Matching Contribution
account on or after January 1, 1993 (but not the earnings thereon),
provided that such Matching Contributions have been held by the Trustee
and allocated to the account for at least twenty-four (24) months. In
addition, if the Plan Committee determines that the condition of Hardship
exists, the Participant may withdraw any portion of his account that is
attributable to (i) pre-tax Employee contributions made by the Participant
under a Prior Plan, but excluding earnings on such contributions accrued
after December 31, 1988, or (ii) Company Contributions allocated to the
Participant's Company Contributions account after December 31, 1988
provided that such Company Contributions have been held by the Trustee and
allocated to the account for at least twenty-four (24) months. However,
the Plan Committee shall permit a hardship distribution only on account of
an immediate and heavy financial need of the Participant as determined by
subparagraph (i) and only to the extent that the distribution is necessary
to satisfy such immediate and heavy financial need, as determined by
subparagraph (ii)."
2. Effective July 1, 1997, Paragraph 12.7 of Section XII is hereby amended and
modified to read as follows:
"12.7 Acceptance of Transfers and Rollover Contributions. The Trustee,
subject to Plan Committee approval, may accept funds transferred on behalf
of a Participant from another trust forming part of a tax-qualified
employee benefit plan or funds qualifying as a rollover contribution under
Sections 408(d)(3) or 402(c) of the Code, provided that in the case of a
transfer from such a trust, the trust from which such funds are
transferred specifically permits the transfer, the Trustee and Plan
Committee are satisfied that the transfer or rollover contribution will
not jeopardize the tax-qualified or exempt status of the Plan or Trust and
the trust is not part of a plan to which the annuity requirements of
Sections 401(a)(11) and 417 of the Code apply or, if such annuity
requirements do apply, the Plan Committee determines, based on evidence
submitted by the Participant that is satisfactory to the Plan Committee,
that acceptance of the rollover contribution will not cause this Plan to
become subject to such annuity rules. The Plan Committee shall develop
such procedures, and may require such information from a plan sponsor,
Trustee or a Participant desiring to make any transfer, as it deems
necessary or desirable to determine that the proposed transfer will meet
the requirements of this paragraph. The Trustee shall maintain a separate
account for each Participant on whose behalf a transfer or rollover
contribution is accepted, which shall receive the amount transferred or
rolled over. Participants for whom a rollover contribution is accepted
shall file an investment election to invest their rollover account in
Employer Stock or any Investment Fund(s) in increments of one percent (1%)
or such other increments approved by the Plan Committee. If such an
election is not filed, the Participant's rollover account shall be
invested in an Investment Fund selected by the Plan Committee that
primarily invests in fixed-income investments with shorter average
maturities than other Investment Funds."
3. Effective October 1, 1997, Exhibit "G" shall be attached and made part of the
Plan and shall read as follows:
"EXHIBIT "G"
TO THE
SUNTRUST BANKS, INC. 401(k) PLAN
PARTICIPATION OF FORMER UNION PLANTERS EMPLOYEES
------------------------------------------------
In addition to the provisions of Paragraph 3.1 of the SunTrust Plan, each
former Participant in the Union Planters Retirement Savings Plan (the
"Union Planters Plan") who becomes an Employee of the Company or an
Affiliate on September 5, 1997 shall be a Participant in the SunTrust Plan
on October 1, 1997. In addition, each individual who would have become a
Participant in the Union Planters Plan on September 5, 1997 if the Union
Planters Plan had remained in existence on that date; and who becomes an
Employee of the Company or an Affiliate on September 5, 1997 shall be a
Participant in the SunTrust Plan on October 1, 1997."
4. Effective January 1, 1998, the first and second paragraphs of Paragraph
9.3(b)(ii) of Exhibit D is hereby amended and modified to read as follows:
"(ii) If a married Participant dies prior to his or her annuity starting
date, the Plan Committee will direct the Trustee to distribute the
Participant's vested benefit to the Participant's surviving spouse in the
form of a Preretirement Survivor Annuity, unless the Participant has a
valid waiver election in effect which waives the Preretirement Survivor
Annuity, with appropriate spousal consent, or unless the Participant and
his or her spouse were not married throughout the one (1) year period
ending on the date of his or her death. A "Preretirement Survivor Annuity"
is an annuity which is purchased with 100% of the Participant's vested
benefit (determined as of the date of the Participant's death) and which
is payable for the life of the Participant's surviving spouse. If the
present value of the Preretirement Survivor Annuity does not exceed
$5,000, the Plan Committee, on or before the annuity starting date, must
direct the Trustee to make a lump sum distribution to the Participant's
surviving spouse, in lieu of a Preretirement Survivor Annuity. This
section applies only to a Participant who dies after August 22, 1984, and
either (i) completes at least one (1) Hour of Service with the Employer
after August 22, 1994, or (ii) separates from Service with at least ten
(10) Years of Service and completes at least one (1) Hour of Service with
the Employer in a Plan Year beginning after December 31, 1975.
If the present value of the Preretirement Survivor Annuity exceeds $5,000,
the Participant's surviving spouse may elect to have the Trustee commence
payment of the Preretirement Survivor Annuity at any time following the
date of the Participant's death, but not later than the mandatory
distribution periods, and may elect any of the forms of payment, in lieu
of the Preretirement Survivor Annuity. In the absence of an election by
the surviving spouse, the Plan Committee must direct the Trustee to
distribute the Preretirement Survivor Annuity on the first distribution
date following the close of the Plan Year in which the latest of the
following occurs: (i) the Participant's death; (ii) the date the Plan
Committee receives notification of or otherwise confirms the Participant's
death; (iii) the date the Participant would have attained Normal
Retirement Age; or (iv) the date the Participant would have attained age
62."
5. Effective January 1, 1998, the first and second paragraphs of Paragraph
9.3(b)(ii) of Exhibit E is hereby amended and modified to read as follows:
"(ii) If a married Participant dies prior to his or her annuity starting
date, the Plan Committee will direct the Trustee to distribute the
Participant's vested benefit to the Participant's surviving spouse in the
form of a Preretirement Survivor Annuity, unless the Participant has a
valid waiver election in effect which waives the Preretirement Survivor
Annuity, with appropriate spousal consent, or unless the Participant and
his or her spouse were not married throughout the one (1) year period
ending on the date of his or her death. A "Preretirement Survivor Annuity"
is an annuity which is purchased with 100% of the Participant's vested
benefit (determined as of the date of the Participant's death) and which
is payable for the life of the Participant's surviving spouse. If the
present value of the Preretirement Survivor Annuity does not exceed
$5,000, the Plan Committee, on or before the annuity starting date, must
direct the Trustee to make a lump sum distribution to the Participant's
surviving spouse, in lieu of a Preretirement Survivor Annuity. This
section applies only to a Participant who dies after August 22, 1984, and
either (i) completes at least one (1) Hour of Service with the Employer
after August 22, 1994, or (ii) separates from Service with at least ten
(10) Years of Service and completes at least one (1) Hour of Service with
the Employer in a Plan Year beginning after December 31, 1975.
If the present value of the Preretirement Survivor Annuity exceeds $5,000,
the Participant's surviving spouse may elect to have the Trustee commence
payment of the Preretirement Survivor Annuity at any time following the
date of the Participant's death, but not later than the mandatory
distribution periods, and may elect any of the forms of payment, in lieu
of the Preretirement Survivor Annuity. In the absence of an election by
the surviving spouse, the Plan Committee must direct the Trustee to
distribute the Preretirement Survivor Annuity on the first distribution
date following the close of the Plan Year in which the latest of the
following occurs: (i) the Participant's death; (ii) the date the Plan
Committee receives notification of or otherwise confirms the Participant's
death; (iii) the date the Participant would have attained Normal
Retirement Age; or (iv) the date the Participant would have attained age
62."
IN WITNESS WHEREOF, the Employer has caused this Third Amendment to be
executed by its duly authorized officers and its corporate seal to be hereto
affixed and attested.
EXECUTED this ________ day of _________________________, 1999.
SUNTRUST BANKS, INC. ATTEST
BY: _________________________ BY: _________________________
Title: ________________________ Title: _________________________
Fourth Amendment to the SunTrust Banks, Inc.
401(k) Plan (Amended and Restated January 1, 1997)
WHEREAS, SunTrust Banks, Inc. (hereinafter referred to as the
"Employer"), heretofore established, and there is now existing, a cash or
deferred profit sharing plan known as the SunTrust Banks, Inc. 401(k) Plan
(hereinafter referred to as the "Plan"); and
WHEREAS, under the terms of the Plan, the Employer has reserved the
ability to amend the Plan; and
NOW, THEREFORE, The Plan is hereby amended and modified as follows:
1. Effective January 1, 1999, Exhibit "H" shall be attached and made part of the
Plan and shall read as follows:
"EXHIBIT "H"
TO THE
SUNTRUST BANKS, INC. 401(k) PLAN
PARTICIPATION OF FORMER CITIZENS BANK OF MARIANNA AND GADSEN STATE BANK
------------------------------------------------------------------------
EMPLOYEES
---------
In addition to the provisions of Paragraph 3.1 of the SunTrust Plan, each
former Participant in the Citizens State Bank Profit Sharing Plan (the
"Citizens Bank Plan") who becomes an Employee of the Company or an
Affiliate on October 31, 1998 shall be a Participant in the SunTrust Plan
on January 1, 1999. In addition, each individual who would have become a
Participant in the Citizens Banks Plan on January 1, 1999 if the Citizens
Bank Plan had remained in existence on that date; and who becomes an
Employee of the Company or an Affiliate on October 31, 1998 shall be a
Participant in the SunTrust Plan on January 1, 1999.
2. Effective January 1, 1999, Exhibit "I" shall be attached and made part of the
Plan and shall read as follows:
"EXHIBIT "I"
TO THE
SUNTRUST BANKS, INC. 401(k) PLAN
PARTICIPATION OF FORMER FIRST UNION EMPLOYEES
---------------------------------------------
In addition to the provisions of Paragraph 3.1 of the SunTrust Plan, each
former Participant in the First Union Savings Plan (the "First Union
Plan") who becomes an Employee of the Company or an Affiliate on December
31, 1998 shall be a Participant in the SunTrust Plan on January 1, 1999.
In addition, each individual who would have become a Participant in the
First Union Plan on January 1, 1999 if such individual remained employed
by First Union on that date; and who becomes an Employee of the Company or
an Affiliate on December, 1998 shall be a Participant in the SunTrust Plan
on January 1, 1999."
3. Effective January 1, 1999, paragraph 2.22.1 is added to Section II, which
shall read as follows:
"2.22.1 Eligible Compensation shall mean for any Plan Year, the sum of (i)
the base salary paid during a Plan Year to a Participant by a Company and
shall include, without limitation, vacation pay, draw for a commission
Employee, short-term disability pay, sick pay, compensation for shift
differential, (ii) any other contributions made on behalf of the
Participant for the Plan Year which are not currently includible in gross
income by reason of the application of Section 125, 132(f), 402(e)(3),
402(h)(1)(B) or 403(b) of the Code (relating to cafeteria plans, qualified
transportation fringes, cash or deferred arrangements, salary
reduction-type simplified employee pensions, and tax deferred annuities,
respectively), (iii) certain bonuses, commissions, and incentive
compensation, which shall be determined from time to time by the Board or
Compensation Committee and attached as Exhibit "J"; and shall exclude
overtime pay, stock options, stock appreciation rights, imputed income and
contributions to other employee pensions and welfare benefits plans or
other similar enumeration. Eligible Compensation taken into account for
purposes of this Plan shall be limited to $160,000 or such greater amount
as may be provided in accordance with Treasury Regulations."
4. Effective January 1, 1999, paragraph 2.16 of Section II is amended and
modified to read as follows:
"2.16 Compensation Deferral Agreement shall mean an agreement pursuant to
which the Participant agrees to defer receipt, pursuant to paragraph 4.2
hereof, of a stipulated percentage of his Eligible Compensation and the
Company agrees to contribute to the Plan the amount so deferred as an
Elective Contribution."
5. Effective January 1, 1999, paragraph 4.2 of Section IV is amended and
modified to read as follows:
"4.2 Elective Contributions. As of any Entry Date, a Participant may,
pursuant to a Compensation Deferral Agreement, direct the Company to
contribute Elective Contributions from the Participant's Eligible
Compensation to the Participant's Elective Contribution subaccount in the
amount of 2%, 3%, 4%, 5%, 6%, 7%, 8%, 9%, 10%, 11%, 12%, 13%, 14% or 15%
of the amount of Eligible Compensation paid during the pay period provided
that the aggregate Elective Contribution for any Participant for any
calendar year may not exceed Seven Thousand Dollar ($7,000), as adjusted
by the Treasury Department pursuant to Section 402(g) of the Code for cost
of living changes. Notwithstanding the provisions of the prior sentence,
during the Plan Year, and as often as deemed necessary, the Plan Committee
may (a) limit the percentage of Eligible Compensation that a Highly
Compensated Active Participant may defer to any rate less than 15% of his
Eligible Compensation, (b) limit the percentage of Eligible Compensation
deferred by all Highly Compensated Active Participants who earn in excess
of an amount of Eligible Compensation selected by the Plan Committee, (c)
for future pay periods may limit the maximum dollar amount that a Highly
Compensated Active Participant may defer during a Plan Year or (d) a
combination of the methods set forth above, if the Plan Committee
determines that such action may be necessary to satisfy either of the
tests set forth in paragraph 5.1. After having made such a limitation
regarding Highly Compensated Active Participants, the Plan Committee may
later raise the then permitted percentage of Eligible Compensation or
dollar amount contributed as Elective Contributions on behalf of Highly
Compensated Active Participants if the Plan Committee determines that the
earlier reduction in the maximum contribution rate or dollar amount for
Highly Compensated Active Participants was not necessary to satisfy either
of the tests set forth in paragraph 5.1. Elective Contributions shall be
made on a payroll deduction basis each pay period."
6. Effective January 1, 1999, paragraph 4.3 of Section IV is amended and
modified to read as follows:
"4.3 Changes to Contribution Rate. If a Participant is eligible to make
Elective Contributions during a Plan Year, he or she may elect to increase
or decrease the percentage of Eligible Compensation that is being deferred
to a whole percentage allowed pursuant to paragraph 4.2. The new election
shall become effective on the first day of the month following the month
in which the election is received by the Plan Committee. Deferral rates
for Elective Contributions in force at the end of the Plan Year for each
Participant shall carryover and remain in force at the same percentage
rate for the next Plan Year unless the Participant files a new
Compensation Deferral Agreement. Regardless of the number of deferral
elections filed in a Plan Year, a Participant may direct the Company to
discontinue making Elective Contributions at any time by giving written
notice to the Plan Committee of such suspension on a form provided by the
Plan Committee, or in such other manner as may be authorized by the Plan
Committee, prior to the beginning of the month for which the suspension is
to become effective. Notwithstanding the prior provisions of this
paragraph, if a Participant discontinues Elective Contributions during a
Plan Year, the Participant may change the rate of or resume Elective
Contributions only as of the following January 1 or any Entry Date
thereafter by giving notice to the Plan Committee, or in such other manner
as may authorized by the Plan Committee, prior to the beginning of the
month that Elective Contributions are to resume. If a Participant has not
deferred Elective Contributions during a Plan Year, the Participant may
direct the Company to contribute Elective Contributions from the
Participant's Eligible Compensation as of any Entry Date by giving notice
to the Plan Committee, or in such other manner as may be authorized by the
Plan Committee, prior to the beginning of the month that includes such
Entry Date."
7. Effective January 1, 1999, paragraph 4.4 of Section IV is amended and
modified to read as follows:
"4.4 Matching Contributions. The Company may, at its discretion, make a
Matching Contribution to each Participant who made Elective Contributions
during the Plan Year. The Board or the Compensation Committee prior to the
beginning of each Plan Year shall determine the percentage of Elective
Contributions that will be contributed by the Company as Matching
Contributions for the Plan Year and such determination shall be
communicated to each Participant prior to the beginning of each Plan Year.
The Board or the Compensation Committee may set a Guarantee Matching
Contribution and/or a Performance Matching Contribution. Any Performance
Matching Contribution shall be allocated only to the Matching Contribution
subaccounts of Active Participants who made Elective Contributions during
the Plan Year and such allocation shall be calculated on a semi-monthly
basis based upon the actual Elective Contributions contributed in each
semi-monthly payroll period of the Plan Year even though the Performance
Matching Contribution may not be contributed until after the end of the
year. If the Board or the Compensation Committee does not set a Matching
Contribution schedule prior to any Plan Year, the Company shall contribute
a Guaranteed Matching Contribution for such Plan Year only for Elective
Contributions up to two percent (2%) of the Participant's Eligible
Compensation and such Matching Contributions shall be equal to fifty
percent (50%) of such eligible Elective Contributions deferred by the
Participant and such allocation shall be calculated on a semi-monthly
basis based upon the actual Elective Contributions contributed in each
semi-monthly payroll period of the Plan Year even though the Guaranteed
Matching Contribution may be contributed at such intervals as determined
by the Corporation."
8. Effective January 1, 1999, Section XIV is amended to add the following
paragraph:
"14.7 Authorization for Certain Suspension in Transactions.
Notwithstanding any other provision of the Plan, the Plan Committee or its
delegate is authorized to suspend temporarily certain transactions under
the Plan as may be reasonably necessary to accommodate a material change
in the record keeping or administrative systems which may be required as
the result of a significant change in the design or administration of the
Plan or Trust, such as, but not limited to, a plan merger, a change in
investment funds or record keepers or a material change in record keeping
systems or programs. Such suspension may last only for such period as may
be reasonably necessary to effectuate the change and shall be limited only
to those transactions that cannot reasonably be completed during the
suspension, such as investment fund transfers, changes in contribution
rate, and completion of distributions requests, loans and withdrawals. The
Plan Administrator shall notify Participants within a reasonable time of
the effective date of such suspension and the date when suspended
transactions may resume. The authority granted under this Section 14.7 is
not intended, and shall not be construed, to allow employer discretion
prohibited by Code Section 401(a)(4) and 411(d)(6) and related Treasury
Regulations."
IN WITNESS WHEREOF, the Employer has caused this Fourth Amendment to be
executed by its duly authorized officers and its corporate seal to be hereto
affixed and attested.
EXECUTED this ________ day of _________________________, 1999.
SUNTRUST BANKS, INC. ATTEST
BY: _________________________ BY: _________________________
Title: ________________________ Title: _________________________
2
FIFTH AMENDMENT TO THE SUNTRUST BANKS, INC. 401(K) PLAN
(AS AMENDED AND RESTATED AS OF JANUARY 1, 1997)
------------------------------------------------------------------------------
The SunTrust Banks, Inc. 401(k) Plan, as amended and restated as of
January 1, 1997, and subsequently amended, is further amended as set forth below
effective as of April 1, 1999, unless otherwise stated:
1. Paragraph 9.1 of Section IX is amended and modified to read as follows:
"9.1 Distributions Upon Disability, Retirement or Termination of
Employment. Subject to the provisions of paragraph 9.2, 9.3 and 9.9, a
Participant's Total Account Balance will be distributed to him or her in
accordance with paragraph 9.2 upon filing a written election following his
or her Disability or termination of service with the Company and all
Affiliates due to Retirement or any other reason. If a Participant's
employment is terminated by death, or if he or she dies after termination
but before complete distribution of the account, his or her account (or
the undistributed balance thereof) will be distributed to the Beneficiary
following receipt of a written election, subject to the provisions of
paragraph 9.10. If a Participant or Beneficiary is entitled to receive
benefits from an account that does not exceed Five Thousand Dollars
($5,000) in value and the recipient does not file a written election for
benefits within forty-five (45) days of receipt of election forms,
distribution of benefits shall commence in accordance with the Plan as
soon as reasonably possible after the later of (i) forty-five (45) days
following delivery of the election forms or (ii) completion of six (6)
semi-monthly payroll periods following the date the participant terminated
employment. If a terminated Participant is age seventy and a half (70 1/2)
or older and he or she does not file a written election for benefits
within forty-five (45) days of receipt of election forms or, if later, by
March 15 of the year following (i) the year in which the Participant
terminated Employment, or if later (ii) the year in which they reach age
seventy and a half (70 1/2), distribution of benefits shall commence in
accordance with the Plan as soon as reasonably possible thereafter except
as provided in paragraph 9.7 for distributions of Employer Stock, or as
provided in paragraph 9.2."
2. Paragraph 9.2 of Section IX is amended and modified to read as follows:
1
"9.2 Time of Payment. Any payment called for under this Section IX shall
be made or commenced no later than the time prescribed in this Plan, or if
no time is prescribed and subject to the provisions of paragraph 9.3, as
soon as practicable after occurrence of the event given rise to the right
of payment, unless where the Participant has died, it is impossible for
the Plan Committee to determine, within such period, the Beneficiary or
legal representative entitled to payment. In such cases, the Plan
Committee shall make payment as soon as possible after such person can be
determined. Where a distribution is triggered by termination of
employment, the distributions generally will not be made until after four
(4) semi-monthly pay periods following the termination to allow for all
final contributions with respect to the Participant to be recorded in the
Trust. Payment of a Participant's benefits must commence not later than
the 60th day after the close of the Plan Year in which the latest of the
following occurs:
(a) the date on which the Participant attains age seventy and a half (70 1/2);
or
(b) the tenth anniversary of the Participant's anniversary of participation in
this Plan; or
(c) the date on which the Participant terminates service with the Employer;
provided however, that the distribution of a Participant's benefit
shall begin in accordance with the provisions of paragraph 9.5. Any
distribution is subject to the rights of a surviving spouse under
paragraph 9.10 and to the rights of an alternate payee under
paragraph 14.4."
3. Paragraph 9.3 of Section IX is amended and modified to read as follows:
"9.3 Consent to Distribution Prior to Age Seventy and a Half (70 1/2).
Unless the provisions of paragraph 9.4 apply, no distribution of benefits
may commence to a Participant before the Participant attains age seventy
and a half (70 1/2) unless the Participant is otherwise entitled to a
distribution hereunder and the Participant provides written consent to the
commencement of the distribution."
2
4. Paragraph 9.11(a) of Section IX is amended and modified to read as follows:
"(a) If a Participant who is employed by a Company can demonstrate that
the condition of Hardship exists as determined by regulations established
by the Plan Committee, upon prior written notice to the Plan Committee, a
Participant may withdraw any portion of his (i) Elective Contributions
made on or after January 1, 1993 (but not the earnings thereon) and (ii)
Matching Contribution allocated to the Participant's Matching Contribution
account on or after January 1, 1993, provided that such Matching
Contributions have been held by the Trustee and allocated to the account
for at least twenty-four (24) months. In addition, if the Plan Committee
determines that the condition of Hardship exists, the Participant may
withdraw any portion of his account that is attributable to (i) pre-tax
Employee contributions made by the Participant under a Prior Plan, but
excluding earnings on such contributions accrued after December 31, 1988,
or (ii) Company Contributions allocated to the Participant's Company
Contributions account after December 31, 1988 provided that such Company
Contributions have been held by the Trustee and allocated to the account
for at least twenty-four (24) months. However, the Plan Committee shall
permit a hardship distribution only on account of an immediate and heavy
financial need of the Participant as determined by subparagraph (i) and
only to the extent that the distribution is necessary to satisfy such
immediate and heavy financial need, as determined by subparagraph (ii)."
5. Paragraph 9.7 of Exhibit "C" is amended and modified to read as follows:
"CONSENT TO DISTRIBUTION PRIOR TO AGE SEVENTY AND A HALF
--------------------------------------------------------
Notwithstanding the provisions of paragraph 9.7, unless the provisions of
paragraph 9.4 apply, no distribution of benefits may commence to a Former
HomeTrust Participant prior to the date such Former HomeTrust Participant
attains age 70 1/2 unless the Former HomeTrust Participating provides
written consent to the commencement of the distribution."
6. Paragraph 9.7 of Exhibit "D" is amended and modified to read as follows:
"CONSENT TO DISTRIBUTION PRIOR TO AGE SEVENTY AND A HALF
--------------------------------------------------------
3
Notwithstanding the provisions of paragraph 9.7, unless the provisions of
paragraph 9.3 of this Exhibit "D" apply, no distribution of benefits may
commence to a Former Florence Participant prior to the date such Former
Florence Participant attains age 70 1/2 unless the Former Florence
Participant provides written consent to the commencement of the
distribution."
7. Paragraph 9.7 of Exhibit "F" is amended and modified to read as follows:
"CONSENT TO DISTRIBUTION PRIOR TO AGE SEVENTY AND A HALF
--------------------------------------------------------
Notwithstanding the provisions of paragraph 9.7, unless the provisions of
paragraph 9.4 apply, no distribution of benefits may commence to a Former
Ponte Vedra Participant prior to the date such Former Ponte Vedra
Participant attains age 70 1/2 unless the Former Ponte Vedra Participant
provides written consent to the commencement of the distribution."
SIXTH AMENDMENT TO THE SUNTRUST BANKS, INC. 401(k) PLAN
(AS AMENDED AND RESTATED AS OF JANUARY 1, 1997)
------------------------------------------------------------------------------
The SunTrust Banks, Inc. 401(k) Plan, as amended and restated as of
January 1, 1997, and subsequently amended, is further amended as set forth below
effective as of July 1, 1999, unless otherwise stated:
1. Paragraph 2.22.1 of Section II is amended and modified to read as follows:
"2.22.1 Eligible Compensation shall mean for any Plan Year, the sum of (i)
the base salary paid during a Plan Year to a Participant by a Company and
shall include, without limitation, vacation pay, draw for a commission
Employee, short-term disability pay, sick pay, compensation for shift
differential, (ii) any other contributions made on behalf of the
Participant for the Plan Year which are not currently includible in gross
income by reason of the application of Section 125, 132(f), 402(e)(3),
402(h)(1)(B) or 403(b) of the Code (relating to cafeteria plans, qualified
transportation fringes, cash or deferred arrangements, salary
reduction-type simplified employee pensions, and tax deferred annuities,
respectively), (iii) overtime pay, (iv) certain bonuses, commissions, and
incentive compensation, which shall be determined from time to time by the
Board or Compensation Committee and attached as Exhibit "J"; and shall
exclude, stock options, stock appreciation rights, imputed income and
contributions to other employee pensions and welfare benefits plans or
other similar enumeration. Eligible Compensation taken into account for
purposes of this Plan shall be limited to $160,000 or such greater amount
as may be provided in accordance with Treasury Regulations.
2. Paragraph 3.1 of Section III is amended and modified to read as follows:
"3.1 Participation. Each Employee who was a Participant immediately prior
to January 1, 1993 shall remain a Participant in this Plan as of January
1, 1993, provided he is an Eligible Employee. Every other Employee who is
an Eligible Employee shall be eligible to participate in the Plan in
accordance with the following rules:
(a) Elective Contributions. Each Eligible Employee shall be eligible to
participate in the Plan for purposes of Elective Contributions as
provided in paragraph 4.2 as of the first Entry Date next following
the calendar month that follows the date the Eligible Employee is
hired provided the Eligible Employee is still in the employ of the
Company on that Entry Date.
(b) Matching Contributions. Each Eligible Employee shall be eligible to
participate in the Plan for purposes of Matching Contributions as
provided in 4.4 as of the Entry Date next following the date the
Eligible Employee completes at least one (1) year of Service,
provided the Eligible Employee is still in the employ of the Company
on that Entry Date.
3. Paragraph 4.4 of Section IV is amended and modified to read as follows:
"4.4 Matching Contributions. The Company may, at its discretion, make a
Matching Contribution to each Participant's Matching Contribution
subaccount for each Participant who made an Elective Contribution during
the Plan Year. The Board or the Compensation Committee prior to the
beginning of each Plan Year shall determine the percentage of Elective
Contributions that will be contributed by the Company as Matching
Contributions for the Plan Year and such determination shall be
communicated to each Participant prior to the beginning of each Plan
Year."
SEVENTH AMENDMENT TO THE SUNTRUST BANKS, INC. 401(K) PLAN
(AS AMENDED AND RESTATED AS OF JANUARY 1, 1997)
WHEREAS, the SunTrust Banks, Inc. (the "Corporation" or "Employer")
heretofore established, and there is now existing, a cash or deferred profit
sharing plan known as the SunTrust Banks, Inc. 401(k) Plan, as amended and
restated as of January 1, 1997, and subsequently amended (the "401(k) Plan");
and
WHEREAS, under the terms of the 401(k) Plan, the Employer has reserved
the ability to amend the 401(k) Plan; and
WHEREAS, on December 31, 1998 Crestar Financial Corporation ("Crestar")
became a wholly-owned subsidiary of the Corporation, as a result of the merger
of SMR Corporation (Va), a wholly-owned subsidiary of the Corporation into and
with Crestar, with Crestar as the surviving entity; and
WHEREAS Crestar sponsors a profit sharing plan with a cash or deferred
arrangement known as the Crestar Employees' Thrift and Profit Sharing Plan, as
amended and restated through December 31, 1994, and subsequently amended (the
"Thrift Plan"); and
WHEREAS Crestar sponsors the Crestar Merger Plan for Transferred
Employees, as amended and restated through December 31, 1994, and subsequently
amended (the "Merger Plan"), a frozen 401(k) plan; and
WHEREAS, Crestar is amending the Thrift Plan and the Merger Plan to
provide that each such Plan is amended to be and is merged into and with the
401(k) Plan effective as of July 1, 1999 and that the assets and liabilities of
each such Plan and its trust shall be transferred to the 401(k) Plan and its
trust; and
WHEREAS, the Corporation wishes to amend its 401(k) Plan to consolidate
the Thrift Plan and the Merger Plan with and into the SunTrust Banks, Inc.
401(k) Plan and to ensure protection of all Internal Revenue Code Section
411(d)(6) benefits extended to the participants in the Thrift Plan and the
Merger Plan.
NOW THEREFORE BE IT RESOLVED, that effective July 1, 1999 or as soon as
practicable thereafter (the "Transfer Date"), the 401(k) Plan is amended to
provide that the Trustee for the 401(k) Plan shall accept a trustee-to-trustee
transfer from the trustee of the Thrift Plan and from the trustee of the Merger
Plan of the assets and liabilities of each such Plan immediately before such
transfer.
1
FURTHER RESOLVED, that such transfers shall be completed in accordance
with the requirements of Section 414(l) of the Internal Revenue Code of 1986, as
amended (the "Code"), and applicable Treasury Regulations, and the account
balance of each participant in the 401(k) Plan immediately after the transfers
to the 401(k) Plan will be equal to or greater than the sum of the account
balances each such participant had in the Thrift Plan, the Merger Plan and the
401(k) Plan immediately prior to such transfers; and
FURTHER RESOLVED that as of the Transfer Date, the 401(k) Plan shall
assume the liabilities of the Thrift Plan and Merger Plan for payment of
benefits from such plans and any benefit features, rights and options with
respect to such accounts transferred from the Thrift Plan and the Merger Plan
shall be preserved to the extent required by Section 411(d)(6) of the Code.
FURTHER RESOLVED, that the Plan is hereby amended and modified by the
addition of Exhibit "J" as attached hereto, which shall follow Exhibit "I."
IN WITNESS THEREOF, SunTrust Banks, Inc. has caused this Seventh Amendment
to the 401(k) Plan to be executed this ____ day of June, 1999.
SunTrust Banks, Inc. Attest
By: ____________________________ By: ____________________________
Title: __________________________ Title: __________________________
2
EXHIBIT "J"
TO THE SUNTRUST BANKS, INC. 401(k) PLAN
FORMER CRESTAR PARTICIPANTS
APPLICATION
-----------
For purposes of this Exhibit "J," the term "Former Crestar Participant" means a
person who was at any time a Participant in the Crestar Employees' Thrift and
Profit Sharing Plan, as amended and restated through December 31, 1994, and
subsequently amended (the "Thrift Plan") or the Crestar Merger Plan for
Transferred Employees, as amended and restated through December 31, 1994, and
subsequently amended (the "Merger Plan") provided the individual had an account
balance in the Thrift Plan or the Merger Plan as of June 30, 1999 or is entitled
to by law to have the Thrift Plan, Merger Plan or the SunTrust Banks, Inc.
401(k) Plan (the "401(k) Plan") reestablish a prior forfeiture under the Thrift
Plan or Merger Plan due to reemployment. This Exhibit "J" shall only apply to a
Former Crestar Participant and, if applicable, to any individual who would have
become a participant in the Thrift Plan or the Merger Plan on July 1, 1999 if
the Thrift Plan or Merger Plan had remained in existence on that date.
Paragraph 3.1
PARTICIPATION
-------------
In addition to the provisions of paragraph 3.1 of the 401(k) Plan, each Former
Crestar Participant who has an account balance in the Thrift Plan or the Merger
Plan on July 1, 1999, shall be a Participant in the 401(k) Plan on July 1, 1999.
In addition, each individual who is eligible to become a Participant in the
Thrift Plan or Merger Plan on July 1, 1999 if the Thrift Plan or Merger Plan had
remained in existence on that date shall become eligible to enroll as a
Participant in the 401(k) Plan on July 1, 1999.
1
Sections VI and VII
VESTING, ACCOUNTS AND ALLOCATIONS
---------------------------------
"401(k) Account" and "Unmatched 401(k) Contribution Account" as defined in the
Thrift Plan and Merger Plan, plus earnings thereon shall be held in an Elective
Contribution account hereunder. "Rollover Account" as defined in the Thrift Plan
and Merger Plan plus earnings thereon shall be held in a Participant rollover
account hereunder. "After Tax Account" as defined in the Thrift Plan and Merger
Plan plus earnings thereon shall be held in a Voluntary Contribution account
hereunder. "PAYSOP Account" as defined in the Thrift Plan plus earnings thereon
shall be held in a Company Contribution account hereunder. "Matching Account,"
"Profit Sharing Account" and "Pre-1987 Employer Account" as defined in the
Thrift Plan and/or Merger Plan shall be held in a Prior Crestar Employer
Contribution account hereunder. "Pension Account" to the Merger Plan plus
earnings thereon shall be held in a Prior Crestar Employer Merger account
hereunder.
All accounts that are transferred from the Thrift Plan or Merger Plan are 100%
vested. All accounts in the 401(k) Plan which receive funds from the Thrift Plan
or Merger Plan shall be 100% vested at all times.
Paragraphs 8.6 and 8.7
DIVERSIFICATION RIGHTS OF QUALIFIED PARTICIPANTS
------------------------------------------------
In addition to the diversification rights of Participants as stated in
paragraphs 8.6 and 8.7, each Former Crestar Plan Participant may elect to
transfer his Prior Crestar Employer Account balance from one more investment
funds to any other investment funds available under the 401(k) Plan. A
Participant may transfer, in multiples of 1%, from one investment fund to one or
more investment funds. A Participant may realign the investments for his Prior
Crestar Employer Account balance by designating transfers, in multiples of 1%,
among the investment funds he chooses from those available under the 401(k)
Plan.
Paragraph 9.8
PAYMENT OPTIONS
(A) Qualified Joint and Survivor Annuity. Notwithstanding the provision of
paragraph 9.8 of the 401(k) Plan, any portion of a Former Crestar
Participant's account in the Merger Plan that as of June 30, 1999 was
subject to the Survivor Annuity Requirements provided under section 8.4
of the Merger Plan shall continue to be subject to such provisions with
regard to that portion of his Total Account that is attributable to
such portion of his Merger Plan Account balance as of June 30, 1999,
plus earnings thereon on and after July 1, 1999.
2
(B) Partial Lump Sum. A Former Crestar Participant retires on his Early,
Normal or Postponed Retirement Date, as defined under the Thrift Plan,
may elect, in lieu of receiving a lump sum payment, to have his Total
Account distributed in installment payments, or a combination of a
partial lump sum and installments. Any such installments shall be in
cash and in approximately equal amounts over any period elected by the
Participant (or his guardian or committee) up to 15 years, but in no
event may the payment period exceed the Participant's life expectancy
as set forth in the rules and regulations under Codess.401(a)(9) with
respect to minimum distributions.
Paragraph 9.11
WITHDRAWAL OF BENEFITS
----------------------
(A) Withdrawals. In addition to the provisions of paragraph 9.11, a Former
Crestar Plan Participant may request a withdrawal from his Total Account
in accordance with the following:
(1) Accounts Available. Withdrawals requested under this subsection on
or after July 1, 1999, may be made from a Participant's Voluntary
Contribution Account, Company Contribution Account, Rollover
Account, and Prior Crestar Employer Account, except that no Employer
contributions allocated to his Prior Crestar Employer Contribution
Account within the 24-month period immediately preceding the
effective date of the withdrawal may be withdrawn. No withdrawals
under this subsection may be made from the portion of a
Participant's Account that is security for a Plan loan, or from a
Participant's Elective Contribution account, Matching Contribution
account, Qualified Nonelective account or Prior Crestar Employer
Merger account.
(2) Frequency. A Participant may request a withdrawal under this
subsection once in each calendar year and at such other times as the
Committee from time to time may determine.
(3) No rollover of withdrawals. Any amount withdrawn pursuant to this
subsection may not be rolled over to the Plan as a Rollover
Contribution.
3
EX-4
3
EXHIBIT 4.4
Exhibit 4.4
SUNTRUST BANKS, INC.
--------------------
401(k) TRUST AGREEMENT
----------------------
(Amended and Restated as of January 1, 1993)
(formerly known as the SunTrust Banks, Inc. Employee
Stock Ownership Trust)
THIS TRUST AGREEMENT, executed the 31st day of December, 1992, by and
between SUNTRUST BANKS, INC., a bank holding company approved under the laws of
the United States, with its principal corporate office in Atlanta, Georgia,
(hereinafter referred to as the "Corporation") and TRUST COMPANY BANK of
Atlanta, Georgia, as Trustee, (hereinafter referred to as the "Trustee").
W I T N E S S E T H :
WHEREAS, SunTrust Banks, Inc. has established a retirement plan consisting
of an employee stock ownership plan and a cash or deferred arrangement, known as
the SunTrust Banks, Inc. 401(k) Plan (the "Plan"), effective January 1, 1993, by
amending and restating the SunTrust Banks, Inc. Employee Stock Ownership Plan,
which Plan is intended to continue to qualify as an Employee Stock Ownership
Plan, as defined in Section 4975(e)(7) of the Internal Revenue Code of 1986, as
amended and to qualify as a cash or deferred arrangement as defined in Section
401(k) of the Internal Revenue Code of 1986, as amended; and
WHEREAS, SunTrust Banks, Inc. now desires to establish the SunTrust Banks,
Inc. 401(k) Trust (the "Trust") effective January 1, 1993 in order to provide a
means of funding the Plan and such Trust shall be established by amending and
restating the SunTrust Banks, Inc. Employee Stock Ownership Trust.
NOW, THEREFORE, it is agreed by and between the Corporation and the Trustee
as follows:
SECTION I
---------
The Corporation hereby establishes, effective January 1, 1993, a trust and
such Trust is hereby created by amending and restating the SunTrust Banks, Inc.
Employee Stock Ownership Trust in its entirety and the Corporation will
contribute thereto such further sums of money and such property acceptable to
the Trustee as shall from time to time be paid or delivered to the Trustee, and
the earnings and profits thereon. The Trustee hereby accepts its appointment as
the Trustee of the SunTrust Banks, Inc. 401(k) Trust pursuant to this Trust
Agreement and agrees to accept the assets and liabilities for payment of
benefits under the SunTrust Banks, Inc. Employee Stock Ownership Trust pursuant
to the terms of this Agreement.
All such money and property, all investments made therewith and profits
thereof and earnings and profits thereon, less the payments which at the time of
reference shall have been made by the Trustee as authorized herein, are referred
to herein as the "Trust Fund".
The Trust Fund shall be held by the Trustee in trust and dealt with in
accordance with the provisions of this Trust Agreement. Except with respect to
contributions made under a mistake of fact or conditioned upon the deductibility
of the contribution or upon approval of the Plan by the Secretary of Treasury
Department, no part of the principal or income of the Trust Fund shall be used
for or diverted to any purposes other
2
than the exclusive benefit of the Participants and their Beneficiaries, nor can
any portion of the Trust Fund revert to or be used by or for the benefit of the
Corporation or any Affiliate.
This Trust Agreement is intended to meet all the requirements of Sections
401(a), 401(k), 501(a) and 4975(e)(7) of the Internal Revenue Code of 1986 (the
"Code") and the Employee Retirement Income Security Act of 1974 ("ERISA"), as
the same may be amended from time to time.
The trust fund established under this Trust Agreement shall be a part of
the Plan. This Trust Agreement shall amend and restate any prior trust agreement
between the parties with respect to the Plan.
The Corporation and the Trustee shall each by a "Named Fiduciary" for the
Fund and, as between the Corporation and the Trustee, the Corporation shall not
be responsible for the performance of any duty or function assigned under this
Trust Agreement to the Trustee and the Trustee shall not be responsible for the
performance of any duty or function so assigned to the Corporation.
Each Named Fiduciary shall have only such powers and responsibilities as
are expressly assigned to it in this Trust Agreement for the control,
safekeeping, management, investment, and administration of the Fund; provided,
in the event of any ambiguity or in the event a power or responsibility is not
expressly assigned to a specific Named Fiduciary, the power or responsibility
shall be deemed to have been assigned to the
3
Corporation. The Trustee shall have no responsibility to inquire into the acts
and omissions of the Corporation in excercise of powers or the discharge of
responsibilities assigned to the Corporation under this Trust Agreement.
A Named Fiduciary, by written instrument filed with the records of the
Plan, may allocate fiduciary responsibilities (other than the responsibilities
of the Trustee in the management and control of the assets of the Fund) to
another Named Fiduciary or may designate a person who is not a Named Fiduciary
to carry out any of its responsibilities under this Trust Agreement (other than
the responsibilities of the Trustee in the management and control of the assets
of the Fund). However, no such designation shall be effective as to the designee
until such person has consented in writing to the allocation or designation and
no such allocation or designation shall be effective as to any Named Fiduciary
(other than the designee) until such Named Fiduciary has received written notice
of such designation.
A Named Fiduciary, or a person designated by a Named Fiduciary to perform
any responsibility of a Named Fiduciary pursuant to the procedure described in
the preceding paragraph, may employ one or more persons to render advice with
respect to any responsibility such Named Fiduciary has under this Trust
Agreement or such person has by virtue of such designation. Any person may serve
in more than one fiduciary capacity under this Trust Agreement.
4
SECTION II
----------
The Trustee shall have the sole and exclusive responsibility, authority and
discretion to manage and control the assets of the Fund in accordance with the
Plan and this Trust Agreement. The Trustee shall act under this Trust Agreement
through one or more of its duly authorized trust officers.
It shall be the duty of the Trustee to do the following:
(A) To hold, to invest and to reinvest the Trust Fund as hereinafter
provided; and
(B) To make such payments and distributions from the Trust Fund at such
time or times and to such person or persons, including any member of the
Plan Committee, as required by the Plan or as directed by the Plan
Committee or its designated agent. Any written direction of the Plan
Committee shall constitute certification that the payment so directed is
one which the Plan Committee is authorized to direct. To the extent
permitted by law, the Trustee shall be under no liability for any payment
made pursuant to the direction of the Plan Committee. The Trustee may make
any payment requested to be made by it hereunder by mailing its check for
the amount thereof to the person to whom the payment is to be made, at such
address as may have been last furnished to the Trustee, or if no such
address shall have been so furnished to the Trustee, to such person in care
of the Plan Committee. Such written directions of the Plan Committee need
not specify the application to be made of payments so directed, and the
Trustee shall not be responsible in any way respecting such application or
for the administration of the Plan. The Trustee shall be under no duty to
enforce payment of any contribution to the Trust Fund and shall not be
responsible for the adequacy of the Trust Fund to meet and discharge
liabilities under the Plan.
SECTION III
-----------
The Trustee shall, in its discretion, unless otherwise directed by the
Corporation, invest and reinvest the principal and income of the Trust Fund and
keep the Trust Fund invested, without distinction between principal and income,
in accordance with the following provisions:
5
(A) The Trustee shall hold, use and apply all funds and other assets
received by it subject to the terms and provisions of the Plan and for the
purposes set forth herein and in the Plan;
(B) Except as provided in Section VIII of the Plan, the Plan is designed to
invest primarily in Qualifying Employer Securities, as defined in Section
407 of ERISA, including, without limitation, Employer Stock.
Notwithstanding the above, the trustee may hold cash in such amounts as may
be in its opinion reasonable for the proper operation of this trust and may
invest such funds in stocks, bonds, securities, investment company or trust
shares, mortgages, notes, government obligations, savings accounts,
certificates of deposit, repurchase agreements and cash equivalents of
the Trustee or others, money market funds, mutual funds, choses in action,
real estate, improvements thereon, and other property as the Trustee may
deem appropriate, including common trust funds, mutual funds, or commingled
trust funds maintained by the Trustee, an Affiliate or others for the
investment of qualified pension, profit sharing and stock bonus plans,
including any common, collective or group trust fund which is maintained
under Code Section 584 or Revenue Ruling 81-100, 1981-1 C.B. 326, by the
Trustee or any bank which is an Affiliate; provided no investment may be
made in employer real property (whether or not such property is qualifying
employer real property) as such term is defined for purposes of Section 407
of ERISA. The Trustee may also appoint a subsidiary of the Trustee to
manage (including the power to acquire and dispose of) any assets held by
the Trustee hereunder, to such extent and upon such terms as the Trustee
deems best, provided:
(1) such manager is registered an investment advisor under the
Investment Advisers Act of 1940;
(2) such manager acknowledged in writing to the Trustee at the time of
such appointment that such manager is a fiduciary with respect to the
Plan; and
(3) the Trustee shall remain responsible for the actions of such
investment manager to the same extent as if such actions were
performed by the Trustee.
Notwithstanding any other provisions of this Section III to the contrary, the
Trustee may, in its sole discretion, retain in cash or keep unproductive of
income such amount of the Trust Fund as
6
it may deem advisable, and it shall not be required to pay interest on such
balance in cash in its hand pending investment.
SECTION IV
----------
In addition to the powers, authorities, duties and discretions elsewhere
herein granted and those conferred by law, the Trustee shall have the following
powers and duties:
(A) The Trustee is authorized and empowered:
(1) To retain any property at any time received by it.
(2) To sell or exchange any property without advertisement at public
or private sale for cash or on credit and grant options for the
purchase or exchange thereof; and no person dealing with the Trustee
shall be bound to see to the application of the purchase money or to
inquire as to the validity, expediency or propriety of any such sale
or other distribution.
(3) To vote, subject to the provisions of subsection (B)(4) below, any
stocks, bonds or other securities, to give general or special proxies
or powers of attorney with or without power of substitution; to
exercise any conversion privileges, subscription rights or other
options and to make any payments incidental thereto; to participate in
any plan or reorganization, consolidation, merger, combination,
liquidation or other similar plan relating to any property and to
consent to or oppose any such plan or any action thereunder, or any
contract, lease, mortgage, purchase, sale or other action by any
person or corporation.
(4) To desposit any property with any protective, reorganization or
similar committee; to delegate discretionary powers to any such
committee; and to pay or agree to pay part of the expenses and
compensation of any such committee on the assessments levied with
respect to any property so deposited.
(5) To manage, operate, repair, improve, develop, preserve, mortgage,
or lease for any period any real property or any oil, mineral or gas
properties, royalties, interests or rights held by it directly or
through any corporation, either alone or by joining with others, using
other trust assets for any of such purposes; to modify, extend, renew,
waive or otherwise adjust any or all of the provisions of any such
mortgage or lease; and to make provisions for
7
amortization of the investment in or depreciation of the value of such
property; to adjust boundaries, to grant easements and to demolish or
erect buildings on any real property.
(6) In the event of foreclosure or any proceeding for the collection
or realization of any mortgage or mortgages held hereunder, to
exchange any such mortgage or mortgages for any other property; to
purchase such property at any foreclosure or other sale or to acquire
such property by deed without foreclosure and to retain property so
purchased or acquired for such period of time as it may deem proper.
(7) To make, execute, acknowledge and deliver any and all deeds,
leases, mortgages, assignments, documents of transfer and conveyance
and any and all instruments that may be necessary or appropriate to
carry out the powers herein granted.
(8) To borrow or raise money at any time or from time to time from any
person or corporation, including itself, including any "exempt loans"
which are made or guaranteed by a "disqualified person" as provided
for in paragraph 12.5 of the Plan, Section 54.4975-7(b) of the
Treasury Regulations and Section 2550.408b-3 of the Department of
Labor Regulations, and to pledge or mortgage such property, but any
loan so made shall be at the then prevailing rate of interest.
(9) To deposit any stock, bond or other security in and depository or
other similar institution and to register any investment held in the
Trust Fund in its own name or in the name of a nominee and to hold any
investments in bearer form, but the books and records of the Trustee
shall at all times show that all such investments are part of the
Trust Fund.
(10) To settle, compromise or submit to arbitration any claims, debts,
or damages due or owing to or from the trust; to commence or defend
suits or legal proceedings to protect any interest of the trust; and
to represent the trust in all suits or legal proceedings of any court
or before any other body or tribunal.
(11) From time to time to retain suitable agents, investment advisers,
legal counsel and independent purchasing agents and to pay them
reasonable expenses and compensation. The Trustee shall not be
responsible for any loss occasioned by any such agents, investment
advisers, legal counsel and independent purchasing agents selected
with reasonable care.
8
(12) To allocate in its sole discretion, in whole or in part, to
principal or income, all receipts and disbursements for which no
express provision in made-hereunder.
(13) To do all acts which it may deem necessary or proper and to
excercise any and all powers of the Trustee under this Agreement,
insofar as such acts or powers are not violative of the provisions of
ERISA, upon such terms and conditions as it may deem to be for the
best interests of the trust.
(B) Notwithstanding the above, the Truste shall comply with the following
requirements:
(1) The Trustee may not obligate the Plan or Trust to acquire Employer
Stock from a particular holder thereof at an indefinite time
determined upon the occurrence of an event such as the death of the
holder. The Plan may not obligate itself to acquire Employer
Securities including, without limitation, Employer Stock under a put
option binding upon the Plan. However, the Plan may be given an option
to assume, at the time a put option is exercised, the rights and
obligations of the Employer under a put option binding upon the
Employer. All purchases of Employer Securities including, without
limitation, Employer Stock shall be made at a price which, in the
judgement of the Trustee, or its designated purchasing agent, does
not exceed the fair market value thereof. All sales of Employer
Securities including, without limitation, Employer Stock shall be made
at a price which, in the judgment of the Trustee, or its designated
purchasing agent, is not less than the fair market value thereof.
(2) All Employer Stock (including fractional shares) allocated to a
Participant's account shall be voted by the Trustee, in accordance
with instructions from such Participant, except as provided below. The
Employer shall provide Participants with notices and information
statements when voting rights are to be exercised, the content of
which must generally be the same as for all holders of Employer Stock.
Fractional shares may be voted by the Trustee on a combined basis, in
order to reflect the direction of the Participants holding such
shares. Participants shall have the right to determine confidentially
whether shares held by them in the plan will be tendered in a tender
or exchange offer. The Trustee shall determine the procedures that
should be followed to insure such confidentiality. The Corporation may
solicit Participants under proxy provisions applicable to all holders
of Employer Stock.
9
The Trustee shall vote any unallocated shares of Employer Stock and
any stock for which it has not received timely instructions in
accordance with the best interests of the Participants and
Beneficiaries.
SECTION V
---------
Reasonable expenses incurred by the Trustee in the performance of its
duties, including fees for legal services rendered to the Trustee and such other
expenses as may be agreed upon in writing from time to time between the
Corporation and the Trustee, and all other proper charges and disbursements of
the Trustee, shall be paid from the Trust Fund, unless paid by the Corporation,
but until paid shall constitute a charge upon the Trust Fund. All taxes of any
and all kinds whatsoever that may be levied or assessed under existing or future
laws, upon or in respect of the Trust Fund or the income therefrom, shall be
paid from the Trust Fund.
SECTION VI
----------
The Trustee shall discharge its duties under this Trust Agreement solely in
the interest of the Participants and Beneficiaries for the exclusive purpose of
providing benefits to the Participants and Beneficiaries and defraying
reasonable expenses of administering the Plan, with the care, skill, prudence
and diligence under the circumstances then prevailing that a prudent man acting
in a like capacity and familiar with such matters would use in the conduct of an
enterprise of a like character and with like aims, and by diversifying the
investment of the Plan, subject to the provisions of Section III, so as to
minimize the risk of large losses, unless under the circumstances
10
it is clearly prudent not to do so, all in accordance with the provisions of the
Plan and this Trust Agreement insofar as they are consistent with the provisions
of ERISA, the Plan, this Trust Agreement and as they may be amended from time to
time; but the duties and obligations of the Trustee as such shall be limited to
those expressly imposed upon it by this Trust Agreement, notwithstanding any
reference herein to the Plan, or to the provisions thereof, it being hereby
expressly agreed that the Trustee is not a party to the Plan and shall have no
responsibility with respect to the opertion or administration of the Plan;
provided, if the Corporation and the Trustee agree, the Trustee shall perform
such recordkeeping functions as set forth in a separate recordkeeping agreement
between the Corporation and the Trustee. No right, power, authority, duty or
responsibility of any kind or description whatsoever respecting the Fund or the
Plan shall be attributed to the Trustee on account of any ambiguity or inference
which might be interpreted by any person to exist in the terms of this Trust
Agreement.
With respect to transfers of plan assets from a Prior Plan or Prior PAYSOP,
the Trustee shall have no responsibility except to receive such money and
property from the trustee of any Prior Plan or Prior PAYSOP and to hold and
administer the same thereafter in accordance with this Trust Agreement and shall
not be responsible for any act or omission of the trustee of the Prior Plan or
Prior PAYSOP, and shall not be required to make any claim or demand against the
such prior trustee unless the Plan
11
Committee shall in writing request the Trustee to make such a claim or demand.
Pursuant to paragraph 14.1 of this Plan, the Plan Committee in its
discretion may direct, and the Trustee shall make payment on such direction,
that payments be made directly to an incompetent or disabled person, whether
because of minority or mental or physical disability, or to the guardian of such
person, or to the person having custody of such person, without further
liability either on the part of the Plan Committee, the Company or the Trustee
for the amount of such payment to the person on whose account such payment is
made. In the event the Trustee shall deem it necessary to withhold any
distribution pending compliance with legal requirements with respect to probate
of wills, appointment of personal representatives, payment or provision for
estate or inheritance taxes, or for death duties or otherwise, the Trustee shall
notify the Plan Committee and shall thereafter take no action pending receipt of
the Plan Committee's instructions to distribute and an agreement from the
Company, in form satisfactory to the Trustee, protecting it from any liability
arising out of noncompliance with such requirements.
The Corporation agrees, to the extent permitted by law, to indemnify and
hold the Trustee harmless from and against any liability that the Trustee may
incur in the administration of the Trust Fund, unless arising from the Trustee's
own negligence, willful misconduct or lack of good faith. The Trustee shall in
no way be responsible for the correctness of the computation of the amount of
any contribution to be made by the Corporation or
12
its Affiliates. The Trustee from time to time may consult with legal counsel of
its own selection (who may be counsel for the Corporation or for the Trustee in
its individual capacity) concerning any question which may arise under this
Agreement, and the Trustee shall not be deemed imprudent by reason of its taking
or refraining from taking any action in accordance with the opinion of counsel.
SECTION VII
-----------
The Trustee shall keep accurate and detailed accounts of all investments,
receipts, disbursements and other transactions in the Trust Fund hereunder, and
all accounts, books and records relating thereto shall be open to inspection and
audit at all reasonable times by any person designated by the Plan Committee.
The Trustee shall determine the value of the Trust Fund by such method as it
shall, in its discretion, determine to be reasonable and proper. The Trustee
shall not be required to make any inventory or appraisal or report to any court,
or to secure any order of court for the exercise of any of its powers (as
described in this Trust Agreement and as otherwise provided by law), and the
Trustee shall not be required to give bond.
Within ninety (90) days following the close of each fiscal year and within
sixty (60) days after the removal of resignation of the Trustee as hereinafter
provided, the Trustee shall file with the Plan Committee a written account
setting forth all investments, receipts, disbursements, and other transactions
effected by it during such fiscal year or during the period from the close of
the last fiscal year to the date of such removal or
13
resignation. Upon the expiration of one (1) year from the date of filing such
annual or other account, the Trustee shall be forever released and discharged
from all liability and accountability to anyone with respect to the propriety of
its actions and transactions shown on such account, except with respect to any
such acts or transactions as to which the Plan Committee shall file written
objections with the Trustee within such one (1) year period.
To the extent permitted by law, but subject to any express provision of
applicable law as may be in effect from time to time to the contrary, and except
as otherwise provided in the Plan, no Beneficiary or Participant of the Trust
Fund hereunder shall have any right at any time to an accounting from the
Trustee with respect to any securities or other property purchased, sold or held
by the Trustee, or with respect to any receipts, disbursements or other
transactions by the Trustee, or regarding any other matter.
The Plan Committee shall have authority to determine the interests of all
persons in the Trust Fund or under the Plan, and the Trustee shall have no duty
to question any direction given by the Plan Committee. The Corporation and the
Plan Committee shall have authority either jointly or severally to enforce this
Agreement on behalf of all persons claiming any interest in the Trust Fund or
under the Plan. To protect the Trust Fund from the expenses which might
otherwise be incurred, it is imposed as a condition for the securing of any
interest in the Trust Fund, and it is hereby agreed, that no other person may
institute or
14
maintain any action or proceeding against the Trustee or the Trust Fund in the
absence of any rule or law to the contrary, written authorization by the Plan
Committee or a judgment of a court of competent jurisdiction that in refusing
such authorization the Plan Committee has acted fraudulently or in bad faith.
In any action or proceeding affecting the Trust Fund, the only necessary parties
shall be the Corporation, the Plan Committee and the Trustee, and no other
person shall be entitled to any notice or process. To the extent permitted by
law, any judgment entered in any such action or proceeding shall be conclusive
upon all persons.
SECTION VIII
------------
The Trustee may be removed by action of the Board or by the Plan Committee,
at any time without cause upon thirty (30) days notice in writing to the
Trustee. The Trustee may resign at any time upon sixty (60) days notice in
writing to the Corporation and the Plan Committee. Upon such removal or
resignation of the Trustee, the Corporation or the Plan Committee shall appoint
and designate in writing a successor Trustee who shall have the same powers and
duties as those conferred upon the Trustee hereunder. Upon acceptance of such
appointment in writing by the successor Trustee, the Trustee shall assign,
transfer and pay over to such successor Trustee the Trust Fund and properties
then constituting such Fund. The Trustee is authorized, however, to reserve
such sum of money as to it may deem advisable for expenses in connection with
the settlement of its accounts or otherwise, and
15
any balance of such reserve remaining after the payment of such expenses shall
be paid over to the successor Trustee.
If a successor is not appointed within sixty (60) days after the Trustee
gives notice of its resignation, the Trustee or the Plan Committee may apply to
any court of competent jurisdiction for appointment of a sucessor.
SECTION IX
----------
Any action by the Corporation pursuant to any of the provisions of this
Agreement shall be evidenced by a resolution of its Board of Directors certified
to the Trustee over the signature of its Secretary or any Assistant Secretary
under the corporate seal, and the Trustee shall be fully protected in acting in
accordance with such resolution so certified to it. All orders, requests and
instructions of the Plan Committee to the Trustee shall be in writing signed
by two (2) members of the committee, or by its Secretary and one (1) member
thereof, and the Trustee shall act and shall be fully protected in acting in
accordance with such orders, requests and instructions. The Corporation shall
furnish the Trustee from time to time certified copies of resolutions of its
Board of Directors evidencing the appointment and termination of office of any
members of the committee and the appointment of successors thereto. The
committee shall furnish the Trustee from time to time certified copies of
minutes of the committee which delegate authority of the committee to any
agents.
The Trustee may rely upon any certificate, notice or direction purporting
to have been signed on behalf of the Plan
16
Committee, or its agents, which the Trustee believes to have been signed by the
committee or the person or persons authorized to act for the committee.
No communication shall be binding upon the Trustee unless the same is in
writing and is received by the Trustee, and shall not be binding until so
received.
SECTION X
---------
The Corporation reserves the right at any time and from time to time by
action of its Board of Directors to terminate this trust or to amend, in whole
or in part, any or all of the provisions of this Agreement, and notice thereof
in writing shall be delivered to the Plan Committee and the Trustee, provided
that no such amendment which affects the rights, duties and responsibilities of
the Trustee may be made without its consent and provided further that no such
amendment shall authorize or permit any part of the principal or income of the
Trust Fund to be used for or diverted to purposes other than for the exclusive
benefit of Participants and their Beneficiaries. Notwithstanding the prior
provisions of this Section, the Trustee shall distribute the trust assets and
terminate only after receipt of (i) a copy of a favorable determination
letter from the Internal Revenue Service respecting such termination or (ii)
other evidence satisfactory to the Trustee that such termination does not
adversely affect the qualification of the Plan and an agreement from the
Corporation, in form satisfactory to the Trustee, protecting it from any
liability in connection with such termination or (iii) opinion of its counsel
that the distribution
17
of assets and termination of the trust is appropriate under the circumstances
and the Trustee has taken such action as is reasonable and necessary to protect
the interests of the Plan Participants and Beneficiaries. Notwithstanding the
above, if the Plan is completely terminated, amounts properly allocated to and
held in a suspense account under the Plan established pursuant to Section
1.415-6(b)(6) of the regulations under Code Section 415 shall revert to the
Corporation if the Plan permits such reversion. The Trustee shall have no
obligation or responsibility whatsoever to determine whether the reversion of
any such amount is permitted by the Code or ERISA.
Any such amendment shall become effective upon (a) delivery to the Trustee
of the written instrument of amendment together with a certified copy of the
resolution of the Board of Directors authorizing such amendment, and (b)
endorsement by the Trustee on such instrument of its receipt thereof, together
with its consent thereto if such consent is required.
SECTION XI
----------
In the event of the termination of the Plan as provided therein, the
Trustee shall dispose of the Trust Fund in accordance with the terms of the
Plan.
Notice of such termination shall be given to the Trustee by an instrument
in writing executed by the Corporation and acknowledged in the same form as this
Trust Agreement, together with a certified copy of the resolutions of the Board
of Directors of the Corporation authorizing such termination. The
18
Corporation shall send a copy of such notice to each member of the Plan
Committee.
SECTION XII
-----------
Unless in this SunTrust Banks, Inc. 401(k) Trust Agreement a different
meaning or definition is expressly specified, the terms "Plan Committee";
"Participant"; "Employer Stock" and all other words, phrases and terms used
herein shall have the meaning and definitions ascribed to them, respectively, in
the SunTrust Banks, Inc. 401(k) Trust Plan as the same may be amended from time
to time.
SECTION XIII
------------
This SunTrust Banks, Inc. 401(k) Trust Agreement shall become effective as
of January 1, 1993, and shall be administered, construed and enforced according
to the laws of the State of Georgia.
SECTION XIV
-----------
Except to the extent permitted by law, no account, benefit, payment or
distribution under the Plan or this Trust Agreement shall be subject to
attachment, garnishment, levy, execution or any claim or legal process of any
creditor of a Participant or Beneficiary, and no Participant or Beneficiary
shall have any right to alienate, commute, anticipate, or assign all or any part
of his account, benefit, payment or distribution under the Plan or this Trust
Agreement. The preceding sentence also shall apply to the creation, alienation,
assignment, or recognition of a right to any benefit payable with respect to a
Participant pursuant to a domestic relations order unless such order is
19
determined in accordance with the Plan to be a "qualified domestic relations
order" within the meaning of Code Section 414(p).
Any person having any claim for any benefit under the Plan shall look
solely to the assets of the Fund for the satisfaction of that claim. Neither the
Trustee nor any of its directors, employees or agents shall have any liability
for any benefit under the Plan.
Any payment to a Participant or Beneficiary, or to the legal representative
or heirs-at-law of any such person made in accordance with the provisions of the
Plan shall to the extent of such payment be in full satisfaction of all claims
under the Plan.
The assets of the Fund shall be held, administered, invested and managed by
the Trustee (except to the extent investment responsibility is allocated to
another person under the terms of this Trust Agreement) consistent with the
terms of this Trust Agreement in all respects as a single trust. To the extent
portions of such assets may be attributable to different employers or may be
allocable to the payment of benefits for different employee groups, the
Corporation shall be responsible for maintaining and determing the appropriate
portion of the Fund held in respect of any such group of employees in the event
that such maintenance or determination shall become necessary, unless the
Corporation and the Trustee agree pursuant to a separate recordkeeping agreement
between the Corporation and the Trustee that the Trustee shall be responsible
for such
20
recordingkeeping functions. The determination by the Corporation or the Trustee
of the portion of the Fund held in respect of any such employee group shall be
final and conclusive upon all persons.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers thereunto duly authorized and their
corporate seals to be hereunto affixed and attested as of the day and year first
above written.
ATTEST: SUNTRUST BANKS, INC.
By: /s/ John C. Hollister By: /s/ Robert H. Bowen
---------------------- -------------------------
Title: Asst. Secretary Title: Senior Vice President
------------------ ------------------------
(CORPORATE SEAL)
ATTEST: TRUST COMPANY BANK
By: /s/ Doug T. Erdman By: /s/ Andrea J. Williams
---------------------- --------------------------
Title: Vice President Title: Group Vice President
------------------ --------------------------
(CORPORATE SEAL)
21
EX-5
4
EXHIBIT 5.1
Exhibit 5.1
[SUNTRUST BANKS, INC. LETTERHEAD]
November 22, 1999
Securities and Exchange Commission
Judiciary Plaza
450 Fifth Street, N.W.
Washington, D.C. 20549
Ladies and Gentlemen:
As Senior Vice President, Managing Attorney and Secretary for SunTrust
Banks, Inc. (the "Company"), I am familiar with the preparation and filing of
the Company's Registration Statement on Form S-8 (the "Registration Statement"),
as filed with the Securities and Exchange Commission (the "Commission") on or
about November 22, 1999, with respect to 8,000,000 shares of the Company's
common stock, $1.00 par value per share (the "Plan Shares"), issuable pursuant
to the SunTrust Banks, Inc. 401(k) Plan (the "Plan") as referenced in the
Registration Statement.
I have reviewed the Plan and the Registration Statement, and I have
examined and am familiar with, the original or copies, certified or otherwise,
of the documents, corporate records and other instruments of the Company
relating to the proposed issuance of the Plan Shares which I deem relevant and
which form the basis of the opinion hereinafter set forth.
I am of the opinion that:
1. Under the laws of the State of Georgia, the jurisdiction in which
the Company is incorporated and the jurisdiction in which the Company has its
principal office, the Company is duly incorporated, validly existing and in good
standing; and
2. The issuance of the Plan Shares has been duly authorized by the
Company and, upon issuance pursuant to the terms of the Plan, the Plan Shares
will be legally issued and outstanding, fully paid and nonassessable, and no
personal liability will attach to the holders of the Plan Shares.
The undersigned counsel to the Company hereby consents to the filing of
this opinion with the Commission as Exhibit 5.1 to the Registration Statement.
Sincerely,
/s/ Raymond D. Fortin
Raymond D. Fortin
EX-23
5
EXHIBIT 23.1
Exhibit 23.1
Consent of Independent Public Accountants
As independent public accountants, we hereby consent to the
incorporation by reference in this registration statement of our report dated
February 25, 1999 incorporated by reference in SunTrust Banks, Inc.'s Form 10-K
for the year ended December 31, 1998 and to all references to our Firm included
in this registration statement.
/s/ ARTHUR ANDERSEN LLP
Atlanta, Georgia
November 22, 1999