Minnesota | 41-0907483 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |
7601 Penn Avenue South Richfield, Minnesota | 55423 | |
(Address of Principal Executive Offices) | (Zip Code) |
Keith J. Nelsen General Counsel & Secretary Best Buy Co., Inc. 7601 Penn Avenue South Richfield, MN 55423 (Name and address of agent for service) | Copy to: Michael J. Voves & David Marx Dorsey & Whitney, LLP 50 South Sixth Street, Suite 1500 Minneapolis, MN 55402-1498 (612) 340-2600 |
Large accelerated filer ý | Accelerated filer o |
Non-accelerated file (Do not check if a smaller reporting company) o | Smaller reporting company o |
TITLE OF SECURITIES TO BE REGISTERED | AMOUNT TO BE REGISTERED | PROPOSED MAXIMUM OFFERING PRICE PER SHARE/OBLIGATION | PROPOSED MAXIMUM AGGREGATE OFFERING PRICE | AMOUNT OF REGISTRATION FEE | ||||||||||||||
Common Stock, par value $0.10 per share(1)(2) | 7,000,000 shares | $ | 43.51 | (3 | ) | $ | 304,570,000 | (3 | ) | $ | 39,229 | |||||||
Deferred Compensation Obligations(4) | $ | 15,000,000 | N/A | $ | 15,000,000 | (5 | ) | $ | 1,932 |
(1) | Pursuant to Rule 416(c) under the Securities Act of 1933, as amended (the "1933 Act"), this Registration Statement also covers an indeterminate amount of interests to be offered or sold pursuant to the Best Buy Retirement Savings Plan (the "401(k) Plan"). |
(2) | Pursuant to Rule 416 of the Securities Act of 1933, this Registration Statement also covers any additional shares of common stock that may be offered or sold under the 401(k) Plan in connection with any stock split, stock dividend or similar transaction. |
(3) | The shares are to be offered at prices not presently determinable. Pursuant to Rule 457(h)(1) and (c), the offering price is estimated solely for the purpose of calculating the registration fee on the basis of the average of the high and low sale prices of the registrant's common stock reported on the New York Stock Exchange on November 14, 2013. |
(4) | The Deferred Compensation Obligations are unsecured obligations of the registrant to pay deferred compensation in the future in accordance with the terms of the Best Buy Co., Inc. Deferred Compensation Plan (the "DC Plan"). |
(5) | Estimated solely for the purpose of determining the registration fee. |
ITEM 3. | Incorporation of Documents by Reference. |
1. | The Transition Report on Form 10-K of Best Buy Co., Inc. (the “registrant”) for the period ended February 2, 2013, certain portions of which were revised by the Current Report on Form 8-K filed on June 21, 2013. |
2. | The 401(k) Plan's Annual Report on Form 11-K for the year ended December 31, 2012. |
3. | All other reports filed by the registrant pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (the “1934 Act”) since February 2, 2013. |
4. | The description of the registrant's common stock contained in its Registration Statement on Form 8-A filed with the SEC pursuant to Section 12 of the 1934 Act. |
ITEM 4. | Description of Securities. |
ITEM 5. | Interest of Named Experts and Counsel. |
ITEM 6. | Indemnification of Directors and Officers. |
ITEM 7. | Exemption from Registration Claimed. |
ITEM 8. | Exhibits. |
4.1 | Amended and Restated Articles of Incorporation, (incorporated herein by reference to Appendix C to the Proxy Statement on Schedule 14A filed by Best Buy Co., Inc. on May 12, 2009) | |
4.2 | Amended and Restated By-Laws, (incorporated herein by reference to Exhibit 3.1 to the Current Report on Form 8-K filed by Best Buy Co., Inc. on September 26, 2013) | |
4.3 | Best Buy Fifth Amended and Restated Deferred Compensation Plan, dated January 1, 2009 | |
4.4 | First Amendment of the Best Buy Fifth Amended and Restated Deferred Compensation Plan, dated November 9, 2010 | |
4.5 | Best Buy Retirement Savings Plan (2013 Restatement), as amended and restated January 1, 2013 | |
5 | Opinion of Dorsey & Whitney LLP as to the legality of the securities being registered under the registrant's Deferred Compensation Plan(1)(2) | |
23.1 | Consent of Deloitte & Touche LLP | |
23.2 | Consent of Dorsey & Whitney LLP (contained in Exhibit 5) | |
24 | Power of Attorney (included on signature page hereto) |
ITEM 9. | Undertakings. |
1. | To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement: |
(i) | To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933 (the “1933 Act”); |
(ii) | To reflect in the prospectus any facts or events arising after the effective date of the Registration Statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the Registration Statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective Registration Statement; and |
(iii) | To include any material information with respect to the plan of distribution not previously disclosed in the Registration Statement or any material change to such information in the Registration Statement. |
2. | That, for the purpose of determining any liability under the 1933 Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
3. | To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering; |
(b) | The undersigned registrant hereby undertakes that, for purposes of determining any liability under the 1933 Act, each filing of the registrant's annual report pursuant to Section 13(a) or Section 15(d) of the 1934 Act (and where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the 1934 Act) |
(c) | Insofar as indemnification for liabilities arising under the 1933 Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the 1933 Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the 1933 Act and will be governed by the final adjudication of such issue. |
BEST BUY CO., INC. | ||
By: | /s/ HUBERT JOLY | |
Hubert Joly | ||
President and Chief Executive Officer |
BEST BUY RETIREMENT SAVINGS PLAN, | ||
Benefits Committee, as Plan Administrator | ||
By: | /s/ CHARLES MONTREUIL | |
Charles Montreuil | ||
Member, Benefits Committee |
Signature | Title | |
/s/ HUBERT JOLY | President, Chief Executive Officer and Director | |
Hubert Joly | (principal executive officer) | |
/s/ SHARON L. McCOLLAM | Executive Vice President, Chief Administrative Officer | |
Sharon L. McCollam | and Chief Financial Officer (principal financial officer) | |
/s/ SUSAN S. GRAFTON | Senior Vice President, Controller and Chief Accounting | |
Susan S. Grafton | Officer (principal accounting officer) |
Signature | Title | |
/s/ BRADBURY H. ANDERSON | Director | |
Bradbury H. Anderson | ||
/s/ LISA M. CAPUTO | Director | |
Lisa M. Caputo | ||
/s/ RUSSELL P. FRADIN | Director | |
Russell P. Fradin | ||
/s/ KATHY J. HIGGINS VICTOR | Director | |
Kathy J. Higgins Victor | ||
/s/ DAVID W. KENNY | Director | |
David W. Kenny | ||
/s/ SANJAY KHOSLA | Director | |
Sanjay Khosla | ||
/s/ ALLEN U. LENZMEIER | Director | |
Allen U. Lenzmeier | ||
/s/ HATIM A. TYABJI | Chairman of the Board and Director | |
Hatim A. Tyabji | ||
/s/ GERARD R. VITTECOQ | Director | |
Gerard R. Vittecoq |
TABLE OF CONTENTS | |||||
Page | |||||
ARTICLE 1. | Definitions | 1 | |||
ARTICLE 2. | Selection, Enrollment, Commencement of Participation | 6 | |||
2.1 | Selection by Committee | 6 | |||
2.2 | Enrollment Requirements | 6 | |||
2.3 | Amount of Participant's Annual Deferral Amount | 7 | |||
2.4 | Company Contribution Amount | 8 | |||
2.5 | Crediting and Debiting of Account Balances | 8 | |||
2.6 | Vesting | 10 | |||
2.7 | Payment of Withholdings to Trustees or Custodian | 10 | |||
ARTICLE 3. | In-Service Distribution; Unforeseeable Financial Emergencies | 10 | |||
3.1 | In-Service Distribution | 10 | |||
3.2 | Other Benefits Take Precedence Over In-Service Distribution | 10 | |||
3.3. | Withdrawal Payout/Suspensions for Unforeseeable Financial Emergencies | 10 | |||
ARTICLE 4. | Retirement Benefit | 11 | |||
4.1 | Retirement Benefit | 11 | |||
4.2 | Payment of Retirement Benefit | 11 | |||
4.3 | Death Prior to Completion of Retirement Benefit | 11 | |||
4.4 | Specified Employees | 11 | |||
ARTICLE 5. | Termination Benefit | 11 | |||
5.1 | Termination Benefit | 11 | |||
5.2 | Payment of Termination Benefit | 11 | |||
5.3 | Death Prior to Completion of Termination Benefit | 12 | |||
5.4 | Specified Employees | 12 | |||
ARTICLE 6. | Pre-Retirement Survivor Benefit | 12 | |||
6.1 | Pre-Retirement Survivor Benefit | 12 | |||
6.2 | Payment of Pre-Retirement Survivor Benefit | 12 | |||
ARTICLE 7. | Beneficiary Designation | 13 | |||
7.1 | Beneficiary | 13 | |||
7.2 | Beneficiary Designation; Change; Spousal Consent | 13 | |||
7.3 | Acknowledgment | 13 | |||
7.4 | No Beneficiary Designation | 14 | |||
7.5 | Doubt as to Beneficiary | 14 | |||
7.6 | Crediting and Debiting Account Balances | 14 |
Page | |||||
ARTICLE 8. | Claims Procedure | 14 | |||
8.1 | Presentation of Claim | 14 | |||
8.2 | Notification of Decision | 14 | |||
8.3 | Review of Denied Claim | 15 | |||
8.4 | Decision on Review | 15 | |||
8.5 | Subsequent Action; Mandatory Arbitration | 15 | |||
ARTICLE 9. | Establishment of the Trust | 16 | |||
9.1 | Establishment and Funding of the Trust | 16 | |||
9.2 | Interrelationship of the Plan and the Trust | 16 | |||
9.3 | Distributions From the Trust | 16 | |||
ARTICLE 10. | Administration | 16 | |||
10.1 | Committee Duties | 16 | |||
10.2 | Administration Upon Change in Control | 17 | |||
10.3 | Agents | 18 | |||
10.4 | Binding Effect of Decisions | 18 | |||
10.5 | Indemnity | 18 | |||
10.6 | Employer Information | 18 | |||
ARTICLE 11. | Termination, Amendment or Modification | 19 | |||
11.1 | Termination | 19 | |||
11.2 | Amendment | 19 | |||
ARTICLE 12. | Miscellaneous | 19 | |||
12.1 | Non-Guarantee of Employment | 19 | |||
12.2 | Rights to Trust Asset | 19 | |||
12.3 | Suspension of Rules | 20 | |||
12.4 | Requirement of Proof | 20 | |||
12.5 | Non-Alienation and Taxes | 20 | |||
12.6 | Savings Clause | 21 | |||
12.7 | Facility of Payment | 22 | |||
12.8 | Requirement of Releases | 22 | |||
12.9 | Board Action | 22 | |||
12.10 | Computational Errors | 22 | |||
12.11 | Communications | 22 | |||
12.12 | Terms | 22 | |||
12.13 | Captions | 22 | |||
12.14 | Governing Law | 23 | |||
12.15 | Notice | 23 | |||
12.16 | Successors | 23 | |||
12.17 | Spouse's Interest | 23 | |||
12.18 | Insurance | 23 | |||
12.19 | Legal Fees To Enforce Rights After Change in Control | 23 |
Page | |||||
ARTICLE 13. | Transitional Rules | 24 | |||
13.1 | Introduction | 24 | |||
13.2 | Amounts Deferred Under Prior Plan | 24 | |||
13.3 | Suspension of Deferrals for Penalty Withdrawals | 25 | |||
13.4 | Treatment of Grandfathered Account Balances | 25 |
1.1 | “Account Balance” shall mean, with respect to a Participant, a credit on the records of the Plan equal to the sum of (i) the Deferral Account balance and (ii) the Company Contribution Account balance. The Account Balance, and any sub-account balance, shall be a bookkeeping entry only and shall be utilized solely as a device for the measurement and determination of the amounts to be paid to a Participant or Beneficiary pursuant to this Plan. As and to the extent necessary to reflect the time and form of payment elections, or other provisions applicable to such amounts, Account Balances shall be separately tracked and maintained by Plan Year. |
1.2 | “Administrator” shall have the meaning described in Article 10. |
1.3 | “Annual Deferral Amount” shall mean that percentage or amount of a Participant’s Base Salary and Bonus or Directors Fees that a Participant timely elects to defer for a Plan Year in accordance with Article 2. In the event of a Participant’s Retirement, Disability (if deferrals cease in accordance with Article 2), Unforeseeable Financial Emergency (if deferrals cease in accordance with Articles 2 and 3), death or a Termination of |
1.4 | “Base Salary” shall mean the annual cash compensation payable for services performed as an Employee by a Participant during a Plan Year, excluding bonuses, commissions, overtime, fringe benefits, stock options, relocation expenses, incentive payments, non- monetary awards, directors fees and other fees, automobile and other allowances, by a Participant, determined before reduction for compensation voluntarily deferred or contributed by the Participant pursuant to all qualified or non-qualified plans of an Employer; provided, however, the Committee may allow on a Plan Year prospective basis commissions (or similar items of recurring compensation) to be treated as Base Salary with respect to individuals for whom such items represent the principal component of basic compensation. |
1.5 | “Beneficiary” shall mean one or more individuals, trusts, estates or other persons, designated in accordance with Article 7, that are entitled to receive benefits under this Plan due to the death of a Participant. |
1.6 | “Beneficiary Designation” shall mean the form or other election procedures established from time to time by the Committee for a Participant to designate a Beneficiary. |
1.7 | “Board” shall mean the board of directors of the Company. |
1.8 | “Bonus” shall mean any cash compensation, not otherwise considered Base Salary, payable for services performed as an Employee by a Participant, for a performance period which is coincident with or begins in a Plan Year, under an Employer’s short-term bonus and cash incentive plans calculated before reduction for compensation voluntarily deferred or contributed by the Participant pursuant to all qualified or non-qualified plans of any Employer. |
1.9 | “Change in Control” or “CIC” is any one of the following: |
(i) | When a person, or more than one person acting as a group, acquires (whether by merger, consolidation, purchase or otherwise) more than fifty percent (50%) of the total fair market value or total voting power of the Company’s stock; |
(ii) | When a person, or more than one person acting as a group, acquires within a twelve (12) month consecutive period, ending with the date of the most recent stock acquisition, stock of the Company possessing at least thirty percent (30%) of the total voting power of the Company’s stock; |
(iii) | When a majority of the members of the Board is replaced within a twelve (12) month period by directors whose appointment or election is not endorsed by a majority of the members of such Board as constituted before such appointment or election; or |
(iv) | When a person, or more than one person acting as a group, acquires within a twelve (12) month consecutive period assets from the Company or an entity |
1.10 | “Claimant” shall have the meaning described in Article 8. |
1.11 | “Code” shall mean the Internal Revenue Code of 1986, as it may be amended from time to time. |
1.12 | “Committee” shall mean the committee described in Article 12. |
1.13 | “Company” shall mean Best Buy Co., Inc., a Minnesota corporation, and any successor to all or substantially all of the Company’s assets or businesses. |
1.14 | “Company Contribution Account” shall mean (i) the Participant’s Company Contribution Amount, plus or minus (ii) amounts credited or debited to such account pursuant to Article 2, less (iii) all distributions made to the Participant or his or her Beneficiary pursuant to this Plan that relate to such account. |
1.15 | “Company Contribution Amount” shall mean the amount, if any, determined in accordance with Section 2.4 for a Plan Year. |
1.16 | “Deferral Account” shall mean (i) a Participant’s Annual Deferral Amount, plus or minus |
1.17 | “Director” shall mean a non-employee member of the Board. |
1.18 | “Directors Fees” shall mean the annual cash retainer and committee fees payable by the Company as compensation for serving on the Board, and such other amounts available for deferral hereunder, if any, as are determined by the Committee prior to the beginning of the applicable deferral period, calculated before reduction for fees deferred hereunder or any other plan or program. |
1.19 | “Disabled” or “Disability” shall mean a physical or mental condition, resulting from physical or mental sickness or injury, which prevents the individual while an Employee or Director from engaging in any substantial gainful activity, and which condition can be expected to last for a continuous period of not less than six (6) months. |
1.20 | “Election Form and Plan Agreement” shall mean the annual enrollment forms and procedures established from time to time by the Committee that a Participant completes to indicate participation in the Plan for a Plan Year and to make elections under the Plan. |
1.21 | “Employee” shall mean any individual who is a common law or statutory employee and for whom the Employer pays Social Security taxes. This term shall not include individuals who are not treated as Employees for purposes of the Plan, even though they may be so treated or considered under applicable law (e.g., individuals whom an Employer treats as employees of a third party or as self-employed). |
1.22 | “Employer” is the Company and each other corporation or unincorporated business which is a member of a controlled group of corporations or a group of trades or businesses under common control (within the meaning of Code Section 414(b) or (c)) which includes the Company, but with respect to other business entities during only the periods of such common control with the Company. |
1.23 | “ERISA” shall mean the Employee Retirement Income Security Act of 1974, as it may be amended from time to time. |
1.24 | “Grandfathered Account Balance” shall have the meaning described in Article 13. |
1.25 | “In-Service Distribution” shall mean the payout described in Section 3.1. |
1.26 | “Key Employee” is an Employee who (i) at any time during that Key Employee Measuring Period owns at least five percent (5%) of the stock (or capital or profits interest) of an Employer, (ii) owns one percent (1%) of the stock (or capital or profits interest) of an Employer and whose compensation exceeds the dollar limit for such period described in Code Section 416(1)(iii), or (iii) is an officer of an Employer and whose compensation exceeds the dollar limit for such period described in Code Section 416(1)(i), as adjusted. No more than the lesser of fifty (50) employees and ten percent (10%) of all employees shall be treated as officers for that period by reason of clause (iii) immediately preceding. In the event the number of officers exceeds such number, the employees included in such number will be those with the highest compensation for that period. |
1.27 | “Key Employee Measuring Period” is the calendar year. |
1.28 | “Participant” shall mean an eligible Employee or Director who has validly elected to participate hereunder and elected to defer amounts under the Plan or who has been or is entitled to be allocated a Company Contribution Amount, or both. An individual who has become a Participant shall continue as a Participant until the earlier of his or her death and the date his or her entire Account Balances have been paid. |
1.29 | “Plan” shall mean the Company’s Deferred Compensation Plan described in this document and as it may be amended from time to time. References to the Plan by year, period or other date shall be to the Plan document as then in effect. |
1.30 | “Plan Year” shall mean the calendar year. |
1.31 | “Pre-Retirement Survivor Benefit” shall mean the benefit described in Article 6. |
1.32 | “Quarterly Installment Method” shall be a quarterly installment payment over the number of quarters selected by the Participant in accordance with this Plan, calculated as follows: The Account Balance of the Participant shall be calculated as of the close of business on the last business day of the quarter preceding the quarter for which the installment is being determined; provided, however, for each of the four (4) consecutive quarterly installment periods which begin with a January, such balance shall be calculated as of the close of business as of a month-end in the immediately preceding quarterly period. Each quarterly installment for such year shall be calculated by multiplying this balance by a fraction, the numerator of which is one, and the denominator of which is the remaining number of quarterly payments due the Participant as of the beginning of such year. Each quarterly installment shall be paid within sixty (60) days of the beginning of the applicable quarter. Unless the Committee determines otherwise, quarterly installment payments shall be drawn on a pro-rata basis from each of the applicable Investment Funds used to determine amounts to be credited or debited to the Participant’s Account Balance pursuant to Article 2. In no event, however, shall the amount payable in all such installments exceed or be less than the Account Balance to which such installments relate and any adjustment in amount necessary to achieve such results shall be taken in order of the last installment to the earliest installment. |
1.33 | “Retirement,” “Retire” or “Retired” shall mean a Termination of Employment for any reason, other than death, on or after the attainment of age sixty (60) in the case of an Employee, and on or after the attainment of age seventy (70) in the case of a Director. |
1.34 | “Retirement Benefit” shall mean the benefit described in Article 4. |
1.35 | “Specified Employee” is a Participant who is a Key Employee for a Key Employee Measuring Period, with such status as to that period becoming effective as of April 1st next following such period and lasting until the following April 1st. |
1.36 | “Termination Benefit” shall mean the benefit described in Article 5. |
1.37 | “Termination of Employment” shall mean the separation from service as an Employee with all business entities that comprise the Employer, or the cessation of services as a Director, for reasons other than death. An individual on a bona fide leave of absence |
1.38 | “Trust” shall mean one or more trusts established pursuant to that certain Master Trust Agreement, dated as of April 1, 1998, between the Company and the trustee named therein, as amended from time to time. |
1.39 | “Unforeseeable Financial Emergency” shall mean an unanticipated emergency that is caused by an event beyond the control of the Participant that would result in severe financial hardship to the Participant, and which cannot be relieved through other reasonable means available to the Participant, resulting from (i) a sudden and unexpected illness or accident of the Participant or his or her spouse or a dependent of the Participant, (ii) a loss of the Participant’s property due to casualty, or (iii) such other extraordinary and unforeseeable circumstances arising as a result of events beyond the control of the Participant, all as determined in the discretion of the Committee. |
2.1 | Selection by Committee. As determined by the Committee in its discretion, participation in the Plan shall be limited to Directors and a select group of management and highly compensated Employees. |
2.2 | Enrollment Requirements. |
(a) | General. As a condition to participation, each eligible Employee or Director shall complete an Election Form and Plan Agreement and comply with such other procedures as the Committee may establish from time to time as necessary for enrollment. |
(b) | Base Salary. An Employee may elect to defer hereunder his or her Base Salary. |
(c) | Bonus Compensation. An Employee may elect to defer hereunder his or her Bonus. Except as provided herein, to be effective for a Plan Year such election shall be made as of the time the Committee may prescribe but in no event later than December 31 of the year immediately prior to the Plan Year the Bonus is earned or the performance period relative to the Bonus begins. |
(d) | Participation During Plan Year. |
(i) | Initial Participation. An Employee or Director who first becomes eligible to participate in the Plan during a Plan Year may elect, within thirty (30) days of becoming so eligible, to defer hereunder (x) his or her Base Salary or Director Fees for that Plan Year earned and paid after such election and |
(ii) | Former Participant. An individual who has been eligible to participate in the Plan, who loses such eligibility by reason of a Termination of Employment or otherwise, and who again becomes eligible to participate in the Plan in a later Plan Year, shall not be eligible to participate in the Plan for purposes of authorizing an Annual Deferral Amount for the Plan Year in which he or she again becomes so eligible unless he or she (x) has not been eligible to make an Annual Deferral Amount election for two (2) or more consecutive years or (y) has previously incurred a Termination of Employment and been paid all benefits under the Plan after such Termination and before again becoming eligible for the Plan. |
(e) | Later Deferral Elections. If and to the extent allowed by the Committee, a deferral election with respect to Bonus Compensation which is: |
(i) | performance-based compensation, may be made no later than six (6) months before the end of the performance period, or |
(ii) | earned over a period of one (1) year or more and which is subject to a substantial risk of forfeiture, no later than one (1) year before the date such |
2.3 | Amount of Participant’s Annual Deferral Amount. |
(a) | Deferral Elections. At the time a Participant elects an Annual Deferral Amount for a Plan Year, he or she shall designate the rate or amount to be withheld from Base Salary, Bonus Compensation, and Director Fees as applicable. Except as described in Section 2.2 or in subsection (c) immediately following, once elected, the Annual Deferral Amount shall be irrevocable with respect to the covered compensation earned during the Plan Year or other period to which such election applies. No amount will be deferred under the Plan from such compensation in the absence of a timely deferral election for a Plan Year. |
(b) | Maximum Deferrals. The maximum percentage or amount of covered compensation which may be deferred hereunder by a Participant for a Plan Year shall be established from time to time by the Committee and may be expressed as a maximum amount or percentage. Different maximums may be applied to Base Salary and Bonus Compensation, or items of Bonus Compensation, and Director Fees. Such maximums shall be established before the Plan Year to which they relate and shall apply throughout that year. |
(c) | Intra-Year Cancellation of Deferrals. In the event a Participant becomes Disabled or, as directed by the Committee, applies for and is granted cancellation of deferrals pursuant to Article 3.3, additional deferrals on behalf of such Participant for the balance of the Plan Year shall be canceled. The cancellation shall be effective as relevant no later than two and one-half (2-1/2) months after the Participant becomes Disabled or the second payroll period ending after the Committee approves the distribution and directs the cancellation. |
2.4 | Company Contribution Amount. |
(a) | General. For each Plan Year, the Company may, but is not required to, credit any amount it desires to any Participant’s Company Contribution Account under this Plan, which amount shall be for that Participant the Company Contribution Amount for that Plan Year. In no event, however, shall any such contribution be in lieu of or otherwise in replacement for an amount otherwise due to or on behalf of a Participant apart from the Plan. The amount so credited to a Participant may be smaller or larger than the amount credited to any other Participant, and the amount credited to any Participant for a Plan Year may be zero, even though one or more other Participants receive a Company Contribution Amount for that Plan Year. The Company Contribution Amount, if any, shall be credited as of the date selected by the Company. |
(b) | Time and Form of Payment. The Account Balance attributable to a Company Contribution Account for a Plan Year shall be paid upon the same events and in the same way and proportions as elected by the Participant with respect to the |
2.5 | Crediting and Debiting of Account Balances. In accordance with, and subject to, the rules and procedures that are established from time to time by the Committee, amounts shall be credited or debited to a Participant’s Account Balance in accordance with the following rules: |
(a) | Election of Investment or Measurement Funds. A Participant, in connection with his or her commencement of participation in the Plan, shall elect one or more investment funds as a measurement to be used to determine the additional amounts to be credited or debited to his or her Account Balance. Commencing with the first day that follows such commencement and continuing thereafter for each subsequent day in which the Participant participates in the Plan, the Participant may elect to add or delete one or more available investment funds or measures to be used to determine the additional amounts to be credited or debited to his or her Account Balance, or to change the portion of his or her Account Balance allocated to any such fund. The Participant may change the percentage of a current year Deferral and Company Contribution Accounts to be invested in each investment fund or elect to have all or part of the Participant’s Account Balance from prior years transferred among the investment funds at any time, or both. Any such election shall be effective as soon as administratively practicable after the election is made. Any such election shall continue in effect thereafter unless and until a new election is made. |
(b) | Proportionate Allocation. In making an election the Participant shall specify, in increments of one percentage point (1%), the percentage of his or her Account Balance to be allocated to an investment fund or measure. |
(c) | Measurement Funds. The Participant may elect one or more available investment or measurement funds made available for this purpose, for the purpose of crediting or debiting additional amounts to his or her Account Balance. As necessary, the Committee may, in its discretion, discontinue, substitute or add any such fund. Each such action will take effect as of a date determined by the Committee so long as such date is under the circumstances reasonably after the date the Committee gives Participants advance written notice of such change. |
(d) | Crediting or Debiting Method. The performance of each elected investment or measurement fund (either positive or negative) will be determined by the Committee, in its reasonable discretion, based on the performance of such funds themselves. A Participant’s Account Balance shall be credited or debited on a business daily basis based on the performance of such fund selected by the Participant, as determined by the Committee in its discretion, as though a Participant’s Account Balance were invested in such funds selected by the Participant, in the percentages applicable to such day, at the closing price on such date. |
(e) | No Actual Investment. Notwithstanding any other provision of this Plan that may be interpreted to the contrary, the funds are to be used for measurement purposes only, and a Participant’s election of any fund, the allocation to his or her Account Balance thereto, the calculation of additional amounts and the crediting or debiting of such amounts to a Participant’s Account Balance shall not be considered or construed in any manner as an actual investment of his or her Account Balance in such fund. Without limiting the foregoing, a Participant’s Account Balance and any sub-account balance thereof shall at all times be a bookkeeping entry only and shall not represent any investment made on his or her behalf by the Company, other Employer or the Trust; the Participant shall at all times remain an unsecured creditor of the Company or other Employer. |
(f) | Participant’s Investment Elections. |
(1) | General. The availability of investment funds for purposes of crediting or debiting additional amounts to Account Balances is not a recommendation to designate a deemed investment in any such investment fund. The selection of deemed investments is solely the responsibility of each Participant. No officer, employee or other agent of the Company or other Employer or the Trustee is authorized to advise or make any recommendation concerning the selection of such funds and no such person is responsible for determining the suitability or advisability of any such selection. |
(2) | Participant Responsibility. Participants shall be solely responsible for selecting, monitoring, and changing the investment funds in or by which their Account Balances are invested. Neither the Company, other Employer, Committee member, nor the Administrator shall be responsible for such investment decisions. To the extent a Participant does not affirmatively elect one or more investment funds with respect to his or her Account Balance, he or she shall be deemed to have elected one or more funds designated for this purpose by the Committee. |
2.6 | Vesting. A Participant shall be fully vested in his or her Account Balance. |
2.7 | Payment of Withholdings to Trustees or Custodian. Except as otherwise provided hereunder or unless otherwise directed by the Committee, an Employer shall remit amounts withheld from Participants and any Company Contribution Amount to the Trustee or other authorized custodian as soon as administratively feasible after such amounts are withheld or otherwise determined and payable. |
3.1 | In-Service Distribution. In connection with and at the time of each Annual Deferral Amount election, a Participant may irrevocably elect to receive a future In-Service |
3.2 | Other Benefits Take Precedence Over In-Service Distribution. Should an event occur before the In-Service Distribution date that triggers a benefit under Article 4, 5, or 6, the Deferral Account that is subject to an In-Service Distribution election shall not be paid in accordance with Section 3.1 but shall be paid in accordance with the other applicable Article. |
3.3 | Withdrawal Payout/Suspensions for Unforeseeable Financial Emergencies. If the Participant experiences an Unforeseeable Financial Emergency, the Participant may petition the Committee to (i) cancel any deferrals required to be made by a Participant or |
4.1 | Retirement Benefit. A Participant who Retires shall receive his or her Account Balance as a Retirement Benefit. |
4.2 | Payment of Retirement Benefit. In connection with and at the time of each Annual Deferral Amount election, a Participant shall irrevocably elect to receive the Retirement Benefit in a lump sum or in a Quarterly Installment Method of twenty (20), forty (40) or sixty (60) quarters and when such benefit shall be paid or shall commence to be paid. If the Participant’s Account Balance at the time of Retirement is less than $10,000, the Retirement Benefit shall be paid in a lump sum notwithstanding the election made; provided, however, the $10,000 threshold shall be based on the then existing Account Balances for all years or other periods of participation, including periods before 2005. If a Participant does not affirmatively elect otherwise, the Retirement Benefit shall be paid in a lump sum. The lump sum shall be paid, or installment payments shall commence, within the first sixty (60) days after the last day of the Plan Year in which the Participant |
4.3 | Death Prior to Completion of Retirement Benefit. If a Participant dies after Retirement but before the Retirement Benefit is paid in full, the Participant’s unpaid Retirement Benefit payments shall continue and shall be paid to the Participant’s Beneficiary at the same time and in the same form as that benefit would have been paid to the Participant had the Participant survived, except as described in Section 4.4. |
4.4 | Specified Employees. In the event the Participant is a Specified Employee at Retirement, however, no lump sum shall be paid and no Quarterly Installment Method shall commence earlier than the six (6) month anniversary of the Retirement date. In the case of a lump sum so delayed, the Account Balance shall be paid in a lump sum within sixty (60) days after such anniversary. In the case of a Quarterly Installment Method where an installment would be due within such six (6) months if the Participant were not a Specified Employee, such installment shall be paid within sixty (60) days of such anniversary and the remaining installments shall be paid as and when otherwise due. In the event the Specified Employee dies during such six (6) months, Section 4.3 shall be applied as if the date of death was the six (6) month anniversary. |
5.1 | Termination Benefit. A Participant who experiences a Termination of Employment which is not a Retirement shall receive his or her Account Balance as a Termination Benefit. |
5.2 | Payment of Termination Benefit. In connection with and at the time of each Annual Deferral Amount election, a Participant shall irrevocably elect to receive the Termination Benefit in a lump sum or in a Quarterly Installment Method of twenty (20) quarters and when such benefit shall be paid or shall commence to be paid. If the Participant’s Account Balance at the time of Termination is less than $25,000, the Termination Benefit shall be paid in a lump sum notwithstanding the election made; provided, however, the $25,000 threshold shall be based on the then existing Account Balances for all years or other periods of participation, including periods before 2005. If a Participant does not affirmatively elect otherwise, the Termination Benefit shall be paid in a lump sum. The lump sum shall be paid, or installment payments shall commence, within the first sixty |
5.3 | Death Prior to Completion of Termination Benefit. If a Participant dies after Termination but before the Termination Benefit is paid in full, the Participant’s unpaid Termination Benefit payments shall continue and shall be paid to the Participant’s |
5.4 | Specified Employees. In the event the Participant is a Specified Employee at such Termination, however, no lump sum shall be paid and no Quarterly Installment Method shall commence earlier than the six (6) month anniversary of such Termination date. In the case of a lump sum so delayed, the Account Balance shall be paid in a lump sum within sixty (60) days after such anniversary. In the case of a Quarterly Installment Method where an installment would be due within such six (6) months if the Participant were not a Specified Employee, such installment shall be paid within sixty (60) days of such anniversary and the remaining installments shall be paid as and when otherwise due. In the event the Specified Employee dies during such six (6) months, Section 5.3 shall be applied as if the date of death was the six (6) month anniversary. |
6.1 | Pre-Retirement Survivor Benefit. The Participant’s Beneficiary shall receive a Pre- Retirement Survivor Benefit equal to the Participant’s Account Balance if the Participant dies before he or she incurs a Termination of Employment. |
6.2 | Payment of Pre-Retirement Survivor Benefit. In connection with and at the time of each Annual Deferral Amount election, a Participant shall irrevocably elect whether the Pre-Retirement Survivor Benefit shall be received by his or her Beneficiary in a lump sum or in a Quarterly Installment Method of twenty (20) or forty (40) quarters. If the Participant’s Account Balance at the time of his or her death is less than $25,000, payment of the Pre-Retirement Survivor Benefit shall be made in a lump sum; provided, however, the $25,000 threshold shall be based on the then existing Account Balances for all years or other periods of participation, including periods before 2005. If a Participant does not affirmatively elect otherwise, the Pre-Retirement Survivor Benefit shall be paid in a lump sum. The lump sum shall be paid, or installment payments shall commence, within the first sixty (60) days after the last day of the Plan Year in which the Participant dies or, if otherwise allowed and affirmatively elected by the Participant, within the first sixty (60) days of a later Plan Year designated by the Participant. |
7.1 | Beneficiary. Each Participant shall have the right to designate his or her Beneficiary (both primary as well as contingent) to receive any benefits payable under the Plan to a Beneficiary upon the death of a Participant. The Beneficiary designated under this Plan may be the same as or different from the Beneficiary designation under any other plan of an Employer in which the Participant participates. |
7.2 | Beneficiary Designation; Change; Spousal Consent. A Participant shall designate his or her Beneficiary by completing and signing the Beneficiary Designation Form, and returning it to the Committee. A Participant shall have the right to change a Beneficiary by completing, signing and otherwise complying with the terms of the Beneficiary Designation Form and the Committee’s rules and procedures for such purposes, as in effect from time to time. If the Participant names someone other than his or her spouse as a Beneficiary of at least fifty percent (50%) of the Participant’s benefits, a spousal consent, in the form designated by the Committee, must be signed by that Participant’s spouse and returned to the Committee. Upon the acceptance by the Committee of a new Beneficiary Designation Form, all Beneficiary designations previously filed shall be cancelled. The Committee shall be entitled to rely on the last Beneficiary Designation Form filed by the Participant and accepted prior to his or her death. |
7.3 | Acknowledgment. No designation or change in designation of a Beneficiary shall be effective until received and acknowledged by the Committee. |
7.4 | No Beneficiary Designation. If a Participant fails to designate a Beneficiary if all designated Beneficiaries predecease the Participant or die prior to complete distribution of the Participant’s benefits, then the Participant’s designated Beneficiary shall be deemed to be his or her surviving spouse. If the Participant has no surviving spouse, the benefits remaining under the Plan shall be payable to the executor or personal representative of the Participant’s estate. |
7.5 | Doubt as to Beneficiary. If and to the extent the Committee has any reasonable doubt or a dispute exists as to the proper Beneficiary to receive payments pursuant to this Plan, the Committee shall have the right, exercisable in its discretion, to cause such payments to be suspended or otherwise sequestered until such matter is resolved to its satisfaction. |
7.6 | Crediting and Debiting Account Balances. After the death of a Participant, a Beneficiary shall be entitled to exercise the rights under the Plan of a Participant who has incurred a Termination of Employment (e.g., direct investments as described in Section 2.5) as and to the extent prescribed by the Committee and to the extent of the Account Balance payable to such Beneficiary. |
8.1 | Presentation of Claim. Any Participant or Beneficiary of a deceased Participant (such Participant or Beneficiary being referred to below as a “Claimant”) may deliver to the Committee a written claim for a determination with respect to the amounts distributable to such Claimant from the Plan. If such a claim relates to the contents of a notice received by the Claimant, the claim must be made within sixty (60) days after such notice was received by the Claimant. All other claims must be made within one hundred eighty (180) days of the date on which the event that caused the claim to arise occurred. The claim must state with particularity the determination desired by the Claimant. |
8.2 | Notification of Decision. The Committee shall consider a Claimant’s claim within a reasonable time, and shall notify the Claimant in writing: |
(a) | that the Claimant’s requested determination has been made, and that the claim has been allowed in full; or |
(b) | that the Committee has reached a conclusion contrary, in whole or in part, to the Claimant’s requested determination, and such notice must set forth in a manner calculated to be understood by the Claimant: |
(i) | the specific reason(s) for the denial of the claim, or any part of it; |
(ii) | specific reference(s) to pertinent provisions of the Plan upon which such denial was based; |
(iii) | a description of any additional material or information necessary for the Claimant to perfect the claim, and an explanation of why such material or information is necessary; and |
(iv) | an explanation of the claim review procedure set forth in Section 12.3 below. |
8.3 | Review of a Denied Claim. Within sixty (60) days after receiving a notice from the Committee that a claim has been denied, in whole or in part, a Claimant (or the Claimant’s duly authorized representative) may file with the Committee a written request for a review of the denial of the claim. Thereafter, but not later than thirty (30) days after the review procedure began, the Claimant (or the Claimant’s duly authorized representative): |
(a) | may review pertinent documents; |
(b) | may submit written comments or other documents; and/or |
(c) | may request a hearing, which the Committee, in its discretion, may grant. |
8.4 | Decision on Review. The Committee shall render its decision on review promptly, and not later than sixty (60) days after the filing of a written request for review of the denial, unless a hearing is held or other special circumstances require additional time, in which case the Committee’s decision must be rendered within one hundred twenty (120) days after such date. Such decision must be written in a manner calculated to be understood by the Claimant, and it must contain to the extent reasonably possible: |
(a) | specific reasons for the decision; |
(b) | specific reference(s) to the pertinent Plan provisions upon which the decision was based; and |
(c) | such other matters as the Committee deems relevant. |
8.5 | Subsequent Action; Mandatory Arbitration. |
(a) | Subsequent Action. A Claimant’s compliance with the foregoing provisions of this Article 8 is a mandatory prerequisite to a Claimant’s right to commence any subsequent action with respect to any claim for benefits under this Plan. |
(b) | Mandatory Arbitration. Any controversy or claim arising out of or relating to this Plan shall be resolved by arbitration in accordance with the Commercial Arbitration Rules of the American Arbitration Association. Arbitration shall be by a single arbitrator experienced in the matters at issue and selected by the parties in accordance with the Commercial Arbitration Rules of the American Arbitration Association. The arbitration shall be held in such place in Minneapolis, Minnesota, as may be specified by the arbitrator (or any place agreed to by the parties and the arbitrator). The decision of the arbitrator shall be final and binding as to any matters submitted under this Article 8; provided, however, if necessary, such decision may be enforced in any court having jurisdiction over the subject matter or over any of the parties to this Plan. All costs and expenses incurred in connection with any such arbitration proceeding (including reasonable attorneys’ fees) shall be borne by the party against which the decision is rendered. If the arbitrator’s decision is a compromise, the determination of which party or parties bears the costs and expenses incurred in connection with such arbitration proceeding shall be made by the arbitrator on the basis of the arbitrator’s assessment of the relative merits of the parties’ positions. |
9.1 | Establishment and Funding of the Trust. The Company shall establish the Trust. |
9.2 | Interrelationship of the Plan and the Trust. The provisions of the Plan shall govern the rights of a Participant to receive distributions pursuant to the Plan. The provisions of the Trust shall govern the rights of the Company, the Participants, and the creditors of the Company and, where applicable, creditors of Employers other than the Company, to the assets transferred to the Trust. Except as inconsistent with the provisions of Sections 10.1(b) and 12.6(b), with such provisions applied by substituting the Trust for the Plan in |
9.3 | Distributions From the Trust. The Company’s and other Employer’s obligations under the Plan may be paid or otherwise satisfied with assets of the Trust and any such payment or satisfaction shall reduce the Company’s or other Employer’s obligations under the Plan in the same amount. |
10.1 | Committee Duties. |
(a) | General. Except as otherwise provided in this Article 10, this Plan shall be administered by a Committee which shall consist of the Board, or such Committee as the Board shall appoint. Members of the Committee may be Participants under this Plan. The Committee shall have the exclusive responsibility for or to direct the general administration and operation of the Plan and the power to take any action necessary or appropriate to carry out such responsibilities. In addition, the Committee shall provide generally for the operation of the Plan and be a liaison between Employers to assure uniform procedures as appropriate. The duties of the Committee shall include, but not be limited to, the following: |
(i) | to prescribe, require and use appropriate forms; |
(ii) | to formulate, issue and apply rules and regulations; |
(iii) | to prepare and file reports, notices and any other documents relating to the Plan which may be required by law; |
(iv) | to interpret and apply the provisions of the Plan; |
(v) | to authorize and direct benefit payments. |
(b) | Code Section 409A. The Plan shall be administered, and the Committee shall exercise its discretionary authority under the Plan, in a manner consistent with Code Section 409A and Treasury Regulations thereunder. Any permissible |
(c) | Allocation to Participating Employers. To the extent practicable and necessary, the Committee shall provide for an accounting of the Trust assets in such manner as will permit the accurate allocation of Account Balances or parts thereof, including the deemed investment earnings and losses attributable thereto, to the relevant Employer. The Committee shall provide to each Employer all information necessary to permit each such Employer to prepare any reports or tax filings which may be required by reason of its status as an Employer. |
10.2 | Administration Upon Change In Control. |
(a) | General. For purposes of this Plan, the Committee, or an independent third party administrator appointed by the Committee, shall be the “Administrator” at all times prior to the occurrence of a Change in Control. Upon and within one hundred twenty (120) days after a Change in Control, the individuals who comprised the Committee immediately prior to the Change in Control (whether or not such individuals are members of the Committee following the Change in Control) may, by written consent of a majority of such individuals, appoint an independent third party administrator, and such independent third party administrator shall have the power and authority reserved to the Committee hereunder except as otherwise provided. The Administrator shall have the discretionary power to determine all questions arising in connection with the administration of the Plan and the interpretation of the Plan and Trust including, but not limited to benefit entitlement determinations; provided, however, upon and after the occurrence of a Change in Control, the Administrator shall have no power to direct the investment of Plan assets or assets of the Trust or select any investment manager or custodial firm for the Plan or Trust. Upon and after the occurrence of a Change in Control, the Company shall pay all reasonable administrative expenses and fees of the Administrator and supply full and timely information to the Administrator or all matters relating to the Plan, the Trust, the Participants and their Beneficiaries, the Account Balances of the Participants, the date of circumstances of the Retirement, Disability, death or Termination of Employment of the Participants, and such other pertinent information as the Administrator may reasonably require. In the event the individuals who comprised the Committee immediately prior to the Change in Control appoint an independent third party administrator upon or after the Change in Control, the Administrator may be terminated (and a replacement appointed) thereafter only with the written consent of the majority of those Participants (or Beneficiaries for those Participants who are then deceased), per capita, who have an interest in the Plan on the date of such termination. |
(b) | Change in Control. Solely for the purpose of applying this Section 10.2, a Change in Control shall have the same meaning as such phrase has under the Trust. |
10.3 | Agents. In the administration of this Plan, the Committee and Administrator may, from time to time, employ agents and delegate to them such administrative duties as it sees fit (including acting through a duly appointed representative) and may from time to time consult with counsel who may be counsel to any Employer. |
10.4 | Binding Effect of Decisions. The decision or action of the Committee and Administrator with respect to any question arising out of or in connection with the administration, interpretation and application of the Plan and the rules and regulations promulgated hereunder shall be final and conclusive and binding upon all persons having any interest in the Plan. |
10.5 | Indemnity. The Company shall indemnify and hold harmless the ex-CEO, the members of the Committee, and the Administrator, and any employee or other agent to whom the duties of the Committee or Administrator may be delegated, against any and all claims, losses, damages, expenses or liabilities arising from any action or failure to act with respect to this Plan, except in the case of gross negligence or willful misconduct by such person. |
10.6 | Employer Information. The Company and each Employer shall supply full and timely information to the Committee or Administrator on all matters relating to the compensation of its Participants, the date and circumstances of the Retirement, Disability, death or Termination of Employment of its Participants, and such other pertinent information as the Committee or Administrator may reasonably require to administer the Plan. |
11.1 | Termination. |
(a) | General. Although the Company anticipates that it will continue the Plan for an indefinite period of time, there is no guarantee that the Company will continue the Plan or will not terminate the Plan at any time in the future. Accordingly, the Company reserves the right to discontinue its sponsorship of the Plan or to suspend or terminate the Plan at any time with respect to any or all of the participating Employees and Directors. Except as otherwise provided or allowed for herein, however, such action shall not cancel an Annual Deferral Amount election for the year of such suspension or Termination or accelerate or defer the payment (determined without regard to such suspension or termination) of Account Balances. |
(b) | Change in Control. Upon or effective with a Change in Control, the Plan shall be terminated effective no later than the end of the Plan Year in which such event |
11.2 | Amendment. The Company may, at any time, amend or modify the Plan in whole or in part; provided, however, that no such amendment shall (i) reduce the value of a Participant’s Account Balance determined as if the Participant had experienced a Termination of Employment as of the effective date of the amendment or modification, (ii) adversely affect any benefits to which a Participant or Beneficiary has become entitled as of the date of the amendment or modification, or (iii) amend or modify substantively this Section 11.2 or Section 10.2 coincident with or after a Change in Control, no matter when such amendment or modification is otherwise purportedly effective. |
12.1 | Non-Guarantee of Employment. Nothing contained in this Plan shall be construed as a contract of employment or other service between an Employer and a Participant, or as a right of any Participant to be continued in the employment or service of an Employer, or as a limitation on the right of an Employer to discharge any Participant with or without notice or with or without cause. |
12.2 | Rights to Trust Asset. No Participant or any other person shall have any right to, or interest in, any part of the Trust assets upon Termination of employment or otherwise, except as otherwise provided under the Plan. If the assets of the Trust are insufficient to pay a Participant’s benefits, the Participant’s Employer shall pay any such amounts from its other general assets. If such Employer does not timely pay such benefits, the sole recourse of a claimant Participant or Beneficiary shall be against such Employer and neither the Company nor any other Employer shall be responsible to pay or provide for the payment of such benefits or liable for the nonpayment thereof. |
12.3 | Suspension of Rules. |
(a) | Federal Securities and Other Laws. Notwithstanding anything in the Plan to the contrary, and to the extent and for the time reasonably necessary to comply with federal securities laws (or other applicable laws or regulations), deferrals, Participant investment-direction, and payment dates and forms under the Plan may be suspended, changed, or delayed as necessary to comply with such laws or regulations; provided, however, any payments so delayed shall be paid to the |
(b) | Section 162(m). If the Committee reasonably determines that a scheduled payment of benefits under the Plan will not be deductible by an Employer by reason of Code Section 162(m), it shall suspend all such payments to the extent not so deductible. Payments so suspended shall be paid within sixty (60) days after the affected Participant dies or incurs a Termination of Employment; provided, however, if the Participant is a Specified Employee when he or she incurs a Termination of Employment, payments suspended pursuant to this subsection shall be paid as described in Section 4.4 or 5.4, as the case may be, as if the amounts so suspended were payable as a lump sum on the date of such Termination. |
(c) | Offset for Amounts Due. A Participant’s Account Balance may be reduced by one or more offsets to repay any amounts then due and owing to an Employer, unless another means of repayment is agreed to by the Committee. Except for the right to immediate offset for an amount up to $5,000, or such higher amount as allowed by Treasury Regulations or other directives under or related to Code Section 409A, the Account Balance shall not be so offset before it is otherwise scheduled to be paid to the Participant or Beneficiary and the amount then offset shall not exceed the amount that would be otherwise so paid. |
12.4 | Requirement of Proof. In discharging their duties and responsibilities under the Plan, the Committee or other individual may require proof of any matter concerning this Plan, and no person shall acquire any rights or be entitled to receive any benefits under this Plan until such proof is furnished. |
12.5 | Non-Alienation and Taxes. |
(a) | General. Except as otherwise expressly provided herein or as otherwise required by law, no right or interest of any Participant or Beneficiary in the Plan and the Trust shall be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, charge, attachment, garnishment, execution, levy, bankruptcy, or any other disposition of any kind, either voluntary or involuntary, prior to actual receipt of payment by the person entitled to such right or interest under the provisions hereof, and any such disposition or attempted disposition shall be void. |
(b) | Tax Withholdings. |
(1) | General. Benefits earned under the Plan and payment of such benefits shall be subject to tax reporting and withholding as required by law and the amount of such withholding may be determined by treating such benefits as being in the nature of supplemental wages. If tax withholdings must be made before such benefits are paid to a Participant or Beneficiary (e.g., FICA taxes on deferrals), they shall be made from other wages paid |
(2) | Tax Consequences. Neither the Company nor any other Employer represents or guarantees that any particular federal, foreign, state or local income, payroll, or other tax consequence will result from participation in this Plan or payment of benefits under the Plan. |
12.6 | Savings Clause. |
(a) | General. If any term, covenant, or condition of this Plan, or the application thereof to any person or circumstance, shall to any extent be held to be invalid or unenforceable, the remainder of this Plan, or the application of any such term, covenant, or condition to persons or circumstances other than those as to which it has been held to be invalid or unenforceable, shall not be affected thereby, and, except to the extent of any such invalidity or unenforceability, this Plan and each term, covenant, and condition hereof shall be valid and shall be enforced to the fullest extent permitted by law. |
(b) | Section 409A. If any term, covenant, or condition of this Plan, or the application thereof to any person or circumstance, shall be considered not to be in compliance with Code Section 409A and Treasury Regulations thereunder, such as would cause all or part of the Participant’s Account Balance to be currently taxable under such provisions, then such term, covenant, condition or application shall be considered modified to the extent necessary to achieve its design and purpose and without such noncompliance or stricken if such modification is not reasonably possible. |
12.7 | Facility of Payment. If the Committee shall determine a Participant or Beneficiary entitled to a distribution hereunder is incapable of caring for his or her own affairs because of illness or otherwise, it may direct any distribution from such Participant’s Account Balances be made, in such shares as it shall determine, to the spouse, child, parent or other blood relative of such Participant or Beneficiary, or any of them, or to such other person or persons as the Committee may determine, until such date as it shall determine such incapacity no longer exists; provided, however, the exercise of this discretion shall not cause an acceleration or delay in the time of payment of Plan benefits except to the extent, and only for the duration of, the time reasonably necessary to resolve such matters or otherwise protect the interests of the Plan. The Committee shall be under no obligation to see to the proper application of the distributions so made to such person |
12.8 | Requirement of Releases. If, in the opinion of the Committee, any present or former spouse or dependent of a Participant or other person shall by reason of the law of any jurisdiction appear to have any bona fide interest in Plan benefits that may become payable to a Participant or with respect to a deceased Participant, or otherwise has asserted such a claim, the Committee may direct such benefits be withheld pending receipt of such written releases as it deems necessary to prevent or avoid any conflict or multiplicity of claims with respect to the payment of such benefits, but only to the extent and for the duration reasonably necessary to resolve such matters or otherwise protect the interests of the Plan. |
12.9 | Board Action. Any action which is required or permitted to be taken by the Board of Directors of the Company under the Plan may be taken by the Compensation Committee of such Board or any other authorized committee of such Board. |
12.10 | Computational Errors. In the event mathematical, accounting, or similar errors are made in processing or paying a benefit under the Plan, the Committee may make such equitable adjustments as it deems appropriate (which may be retroactive) to correct such errors. |
12.11 | Communications. The Committee shall prescribe such forms of communication, including forms for benefit application and the like, with respect to the Plan and Fund as it deems appropriate. Except as otherwise prescribed by such persons or otherwise provided by applicable law or regulation, any such communication and assent or consent thereto may be handled by electronic means. |
12.12 | Terms. Whenever any words are used herein in the masculine, they shall be construed as though they were in the feminine in all cases where they would so apply; and whenever any words are used herein in the singular or in the plural, they shall be construed as though they were used in the plural or the singular, as the case may be, in all cases where they would so apply. |
12.13 | Captions. The captions of the articles, sections and paragraphs of this Plan are for convenience only and shall not control or affect the meaning or construction of any of its provisions. |
12.14 | Governing Law. Subject to ERISA, the provisions of this Plan shall be construed and interpreted according to the internal laws of the State of Minnesota without regard to its conflicts of laws principles. |
12.15 | Notice. Any notice or filing required or permitted to be given to the Committee under this Plan shall be sufficient if in writing and hand-delivered, or sent by registered or certified mail, to the address below: |
12.16 | Successors. The provisions of this Plan shall bind and inure to the benefit of the Company and other Employers and their respective successors and assigns, and to the Participants and their Beneficiaries. |
12.17 | Spouse’s Interest. The interest in the benefits hereunder of a spouse of a Participant who has predeceased the Participant shall automatically pass to the Participant and shall not be transferable by such spouse in any manner, including but not limited to such spouse’s will, nor shall such interest pass under the laws of intestate succession. |
12.18 | Insurance. The Company, on its own behalf or on behalf of other Employers, in its discretion, may apply for and procure insurance on the life of the Participant, in such amounts and in such forms as the trustees may choose. The Company or the trustees of the Trust, as the case may be, shall be the sole owner and beneficiary of any such insurance. The Participant shall have no interest whatsoever in any such policy or policies, and at the request of the Company shall submit to medical examinations and supply such information and execute such documents as may be required by the insurance company or companies to whom the Company has applied for insurance. |
12.19 | Legal Fees To Enforce Rights After Change in Control. The Company is aware that upon the occurrence of a Change in Control, the Board or the board of directors of a Participant’s Employer (which might then be composed of new members) or a shareholder of the Company or the Participant’s Employer, or of any successor corporation might then cause or attempt to cause the Company, the Participant’s Employer or such successor to refuse to comply with its obligations under the Plan and might cause or attempt to cause the Company or the Participant’s Employer to institute, or may institute, litigation seeking to deny Participants the benefits intended under the Plan. In these circumstances, the purpose of the Plan could be frustrated. Accordingly, if, following a Change in Control, it should appear to any Participant that the Company, the Participant’s Employer or any successor corporation has failed to comply with any of its obligations under the Plan or any agreement thereunder or, if the Company, such Employer or any other person takes any action to declare the Plan void or unenforceable or institutes any litigation or other legal action designed to deny, diminish or to recover from any Participant the benefits intended to be provided, then the Company irrevocably authorizes such Participant to retain counsel of his or her choice at the expense of the Company to represent such Participant in connection with the initiation or defense of any litigation or other related legal action, whether by or against the Company, the |
13.1 | Introduction. This Plan document is effective on January 1, 2009 (i.e., the “effective date”) and, except as otherwise provided herein, shall apply only to those persons who are Participants or Beneficiaries on or after the effective date. The provisions of the Plan document as in effect prior to the effective date, taking into account changes made in operations to satisfy Code Section 409A, Treasury Regulations thereunder and other guidance with respect to such Code Section issued by the Internal Revenue Service, even if not reflected in the formal Plan document previously in effect, shall continue to govern the rights and entitlements of persons not described in the immediately preceding sentence except to the extent (i) the application of this Plan document to such persons or the payment of benefits to such persons does not materially diminish or enlarge such rights and entitlements, or (ii) such application is necessary to satisfy such law and regulations. |
13.2 | Amounts Deferred Under Prior Plan. |
(a) | General. Account Balances (including earnings and losses on such balances regardless of when incurred) attributable to deferrals and contributions for periods after 2004 shall be accounted for separately from such balances attributable to deferrals and contributions (other than those described in subsection (b) immediately following) for periods before 2005 (such pre-2005 balances are referred to as the “Grandfathered Account Balances”). |
(b) | Non-Vested. The Grandfathered Account Balances shall not include any portion thereof which was not vested as of December 31, 2004, with such vesting determined without regard to any amendment or other material action, or other than the continued performance of services, made or taken after October 3, 2004, which caused an increase in such vesting. Such non-vested portions of such balances shall be paid at the time and form elected by the Participant concerned on or before December 31, 2004 and, in the absence of any such election, shall be paid in a lump sum during the first sixty (60) days of the Plan Year which immediately follows the Plan Year in which the Participant incurs a Termination of Employment, Retires, or dies. |
13.3 | Suspension of Deferrals for Penalty Withdrawals. The exercise of the 10% penalty withdrawal feature under Section 4.4 of the 2004 Plan shall cause a cancellation of any further Annual Deferral Amount as described therein and no Annual Deferral Amount may be elected by the Participant concerned with respect to any period before the second Plan Year which begins after the date of such payment. |
13.4 | Treatment of Grandfathered Account Balances. Except as otherwise provided herein, the time and form of payment of Grandfathered Account Balances, including any right to further accelerate or further defer any such payment, whether as of right or petition by the Participant or Beneficiary concerned or in the discretion of the Committee or other third party, shall not be materially enlarged or subtracted from by this Plan restatement. |
1. | In-Service Distribution. |
(a) | Electing a Scheduled Distribution. In connection with and at the time of each Annual Deferral Amount election, a Participant may irrevocably elect to receive a future In-Service Distribution from the Plan with respect to all or a portion of such Deferral Account. The In-Service Distribution shall be a lump sum payment in an amount that is equal to the portion of the Deferral Account for which the Participant has elected to receive such distribution, adjusted as provided for in Section 2.5 to the time of such distribution. The In-Service Distribution shall be paid within the first sixty (60) days of the Plan Year that begins two Plan Years after the end of the Plan Year to which the Annual Deferral Amount relates or such later Plan Year as is timely elected by the Participant. By way of example, if the minimum two year In-Service Distribution is elected for Annual Deferral Amounts that are deferred in the Plan Year commencing January 1, 2009, a minimum two year In-Service Distribution would be payable during the sixty (60) day period commencing January 1, 2012. |
(b) | Postponing Scheduled Distributions. Subject to Section 3.2, a Participant may make an election to postpone any In-Service Distribution described in Section 3.l(a) above, and have such amount paid out in a lump sum payment during a sixty (60) day period commencing immediately after an allowable alternative distribution payable date designated by the Participant in accordance with this Section 3.1(b). In order to make this election, the Participant must submit a new In-Service Distribution election form to the Committee in accordance with the following criteria: |
(i) | Such election form must be submitted to and accepted by the Committee at least twelve (12) months prior to the Participant's previously designated In-Service Distribution payable date; |
(ii) | The new In-Service Distribution payable date selected by the Participant must be a January 1 at least five years after the previously designated In-Service Distribution payable date; |
(iii) | The election of the new In-Service Distribution payable date will not be effective until twelve (12) months after the date on which the election is made. |
1. | Establishment and Funding of Trust. The Company may establish a Trust with an independent corporate trustee in order to provide assets from which the obligations of the Employer(s) to the Participants and their Beneficiaries under the Plan may be fulfilled. The Trust must be a grantor trust that conforms substantially with the model trust described in Revenue Procedure 92-64. The Employers may from time to time transfer to the Trust cash, marketable securities or other property, including securities issued by the Company, acceptable to the Trustee in accordance with the terms of the Trust. |
2. | Interrelationship of the Plan and the Trust. The provisions of the Plan shall govern the rights of a Participant to receive distributions pursuant to the Plan. The provisions of the Trust shall govern the rights of the Employers, Participants and the creditors of the Employers to the assets transferred to the Trust. Each Employer shall at all times remain liable to carry out its obligations under the Plan. Nothing contained in the Plan or Trust is to be construed as providing for assets to be held for the benefit of any Participant or any other person or persons to whom benefits are to be paid pursuant to the terms of the Plan, with the Participant's or other person's only interest under the Plan being the right to receive the benefits set forth herein. The Trust is established only for the convenience of the Employers and the Participants, and no Participant has any interest in the assets of the Trust prior to distribution of such assets pursuant to the Plan. To the extent the Participant or any other person acquires a right to receive benefits under the Plan or the Trust, such right is no greater than the right of any unsecured general creditor of the Employer. |
3. | SAVINGS CLAUSE. Save and except as herein expressly amended, the Plan Statement shall continue in full force and effect. |
SECTION 1. | INTRODUCTION 2 |
1.1. | Definitions |
1.1.1. | Accounts |
(a) | Total Account |
(b) | Deferral Contribution Account |
(c) | Qualified Non-Elective Contribution Account |
(d) | Safe Harbor Contribution Account |
(e) | Regular Matching Contribution Account |
(f) | Regular Employer Contribution Account |
(g) | Rollover Account |
1.1.2. | Affiliate |
1.1.3. | Alternate Payee |
1.1.4. | Annual Valuation Date |
1.1.5. | Beneficiary |
1.1.6. | Code |
1.1.7. | Committee |
1.1.8. | Disability |
1.1.9. | Early Retirement Age |
1.1.10. | Effective Date |
1.1.11. | Eligibility Service |
1.1.12. | Eligible Compensation |
1.1.13. | Eligible Employment |
1.1.14. | Employer |
1.1.15. | Employer Stock Fund |
1.1.16. | Employer Stock Fund Fiduciary |
1.1.17. | Employment Commencement Date |
1.1.18. | Enrollment Date |
1.1.19. | ERISA |
1.1.20. | Event of Maturity |
1.1.21. | Fund |
1.1.22. | Highly Compensated Employee |
1.1.23. | Hours of Service |
1.1.24. | Investment Manager |
1.1.25. | Leased Employee |
1.1.26. | Normal Retirement Age |
1.1.27. | Participant |
1.1.28. | Period of Service |
1.1.29. | Period of Severance |
1.1.30. | Plan |
1.1.31. | Plan Statement |
1.1.32. | Plan Year |
1.1.33. | Principal Sponsor |
1.1.34. | Prior Plan Statement |
1.1.35. | Reemployment Commencement Date |
1.1.36. | Salary Reduction Election |
1.1.37. | Severance from Service Date |
1.1.38. | Subfund |
1.1.39. | Trust Agreement |
1.1.40. | Trustee |
1.1.41. | Valuation Date |
1.1.42. | Vested |
1.1.43. | Vesting Service |
1.2. | Compliance With Uniformed Services Employment and Reemployment Rights Act of 1994 and Heroes Earnings Assistance and Relief Tax Act of 2008 |
1.3. | Rules of Interpretation |
1.4. | Special Effective Dates |
SECTION 2. | ELIGIBILITY AND PARTICIPATION 12 |
2.1. | Eligibility |
2.1.1. | General Eligibility Rule |
2.1.2. | ERISA Fail Safe Rule |
2.2. | Special Rule for Former Participants |
2.3. | Salary Reduction Election |
2.3.1. | In General |
2.3.2. | Initial Election |
2.4. | Modification of Salary Reduction Elections |
2.4.1. | Increase or Decrease |
2.4.2. | Cancellation of Salary Reduction Election |
2.4.3. | Termination of Eligible Employment |
2.4.4. | 402(g) Limit |
2.5. | Catch‑Up Contributions |
2.5.1. | Enrollment |
2.5.2. | Remittance |
2.5.3. | Limitations and Testing |
2.5.4. | Re‑characterization of Catch‑Up Contributions as Elective Deferrals |
2.5.5. | Re‑characterization of Elective Deferrals as Catch‑Up Contributions |
SECTION 3. | CONTRIBUTIONS AND ALLOCATION THEREOF 15 |
3.1. | Employer Contributions |
3.1.1. | Source of Employer Contributions |
3.1.2. | Limitation |
3.1.3. | Form of Payment |
3.2. | Salary Reduction Contributions |
3.2.1. | Amount |
3.2.2. | Allocation |
3.3. | Safe Harbor Matching Contributions |
3.3.1. | Amount |
3.3.2. | Matching Contributions Determined on an Annual Basis |
3.3.3. | Allocation |
3.4. | Employer Discretionary Matching Contributions |
3.4.1. | Amount |
3.4.2. | Allocation |
3.5. | Employer Non‑Elective Contributions |
3.5.1. | Amount |
3.5.2. | Allocation |
3.5.3. | Eligible Participants |
3.6. | Adjustments |
3.6.1. | Make‑Up Contributions for Omitted Participants |
3.6.2. | Mistaken Contributions |
3.7. | Rollover Contributions |
3.7.1. | Contingent Provision |
3.7.2. | Eligible Contributions |
3.7.3. | Specific Review |
3.6.4. | Allocation |
3.8. | Limitation on Annual Additions |
3.9. | Effect of Disallowance of Deduction or Mistake of Fact |
SECTION 4. | INVESTMENT AND ADJUSTMENT OF ACCOUNTS 19 |
4.1. | Establishment of Subfunds |
4.1.1. | Establishing Commingled Subfunds |
4.1.2. | Operational Rules |
4.1.3. | Revising Subfunds |
4.1.4. | Employer Stock Fund |
4.1.5. | ERISA Section 404(c) Compliance |
4.2. | Valuation and Adjustment of Accounts |
4.2.1. | Valuation of Fund |
4.2.2. | Adjustment of Accounts |
4.2.3. | Rules |
4.3. | Management and Investment of Fund |
SECTION 5. | VESTING 24 |
5.1. | Fully Vested Accounts |
5.2. | Regular Contribution Accounts |
5.2.1. | Graduated Vesting |
5.2.2. | Full Vesting |
5.2.3. | Full Vesting Upon Plan Termination Before Forfeiture Event |
5.2.4. | Special Rule for Partial Distributions |
5.2.5. | Effect of Break on Vesting |
SECTION 6. | MATURITY 26 |
6.1. | Events of Maturity |
6.2. | Forfeitures |
6.2.1. | Forfeiture of Nonvested Portion of Accounts |
6.2.2. | Restoration Upon Rehire After Forfeiture |
6.2.3. | Use of Forfeitures |
6.2.4. | Source of Restoration |
SECTION 7. | DISTRIBUTIONS AND LOANS 28 |
7.1. | Distributions to Participants Upon Event of Maturity |
7.1.1. | Application For Distribution Required |
7.1.2. | Spousal Consent Not Required |
7.1.3. | Form of Distribution |
7.1.4. | Time of Distribution |
7.1.5. | Required Beginning Date |
7.1.6. | Effect of Reemployment |
7.1.7. | Death Prior to Distribution |
7.2. | In‑Service Distributions |
7.2.1. | Age 59‑1/2 Distributions |
7.2.2. | Hardship Distributions |
7.2.1. | In‑Service Distributions from Rollover Account |
7.3. | Distributions to Beneficiary |
7.3.1. | Application For Distribution Required |
7.3.2. | Form of Distribution |
7.3.3. | Time of Distribution |
7.3.4. | Beneficiary’s Required Beginning Date |
7.4. | Designation of Beneficiaries |
7.4.1. | Right To Designate |
7.4.2. | Spousal Consent |
7.4.3. | Failure of Designation |
7.4.4. | Disclaimers by Beneficiaries |
7.4.5. | Definitions |
7.4.6. | Special Rules |
7.5. | General Distribution Rules |
7.5.1. | Notices |
7.5.2. | Direct Rollover |
7.5.3. | Compliance with Section 401(a)(9) of the Code |
7.5.4. | Distribution in Cash |
7.5.5. | Facility of Payment |
7.5.6. | Accounts of Lost Distributees and Lost Participants |
7.6. | Loans |
7.7. | Distributions under Qualified Domestic Relations Order |
7.8. | Required Minimum Distributions |
7.8.1. | Participant’s Required Beginning Date |
7.8.1. | Participant’s Required Minimum Distributions |
7.8.3. | Beneficiary’s Required Beginning Date |
7.8.4. | Beneficiary’s Required Minimum Distributions |
7.8.5. | Alternate Payee’s Required Minimum Distributions |
SECTION 8. | SPENDTHRIFT PROVISIONS 42 |
SECTION 9. | AMENDMENT AND TERMINATION 43 |
9.1. | Amendment |
9.2. | Discontinuance of Contributions and Termination of Plan |
9.3. | Merger or Spinoff of Plans |
9.3.1. | In General |
9.3.2. | Limitations |
9.3.3. | Beneficiary Designations |
9.4. | Adoption by Other Employers |
9.4.1. | Adoption by Consent |
9.4.2. | Procedure for Adoption |
9.4.3. | Effect of Adoption |
SECTION 10. | INDEMNIFICATION 45 |
SECTION 11. | DETERMINATIONS - RULES AND REGULATIONS 46 |
11.1. | Determinations |
11.2. | Claim and Review Procedures |
11.2.1. | Initial Claim |
11.2.2. | Notice of Initial Adverse Determinations |
11.2.3. | Request for Review |
11.2.4. | Claim on Review |
11.2.5. | Notice of Adverse Determination for Claim on Review |
11.3. | Claim and Review Procedures for Disability Claims Filed under the Plan |
11.3.1. | Initial Disability Claim |
11.3.2. | Notice of Initial Adverse Determination |
11.3.3. | Request for Review |
11.3.4. | Disability Claim on Review |
11.3.5. | Notice of Adverse Determinations for Disability Claim on Review |
11.4. | Rules and Regulations |
11.4.1. | Adoption of Rules |
11.4.2. | Special Rules |
11.5. | Deadline to File Claim |
11.6. | Exhaustion of Administrative Remedies |
11.7. | Deadline to File Legal Action |
11.8. | Knowledge of Fact by Participant Imputed to Beneficiary |
11.9. | Venue |
SECTION 12. | PLAN ADMINISTRATION 52 |
12.1. | Principal Sponsor |
12.2. | Committee |
12.2.1. | Appointment and Removal |
12.2.2. | Automatic Removal |
12.2.3. | Authority |
12.2.4. | Majority Decisions |
12.3. | Limitation on Authority |
12.4. | Conflict of Interest |
12.5. | Dual Capacity |
12.6. | Administrator |
12.7. | Named Fiduciaries |
12.8. | Service of Process |
12.9. | Administrative Expenses |
12.10. | IRS Qualification |
12.11. | Method of Executing Instruments |
12.11.1. | Employer or Committee |
12.11.2. | Trustee |
12.12. | Rules and Regulations |
12.13. | Information Furnished by Participants |
12.14. | Receipt of Documents |
12.15. | Powers of Attorney |
12.16. | Guardians and Conservators |
SECTION 13. | IN GENERAL 56 |
13.1. | Disclaimers |
13.1.1. | Effect on Employment |
13.1.2. | Sole Source of Benefits |
13.1.3. | Co‑Fiduciary Matters |
13.2. | Reversion of Fund Prohibited |
13.3. | Contingent Top Heavy Plan Rules |
13.4. | Continuity |
13.5. | Execution in Counterparts |
SCHEDULE I - | EMPLOYERS SI‑1 |
SCHEDULE II - | PLAN MERGERS AND TRANSFERS SII‑1 |
EMPLOYERS SIII‑1 |
APPENDIX A - | LIMITATION ON ANNUAL ADDITIONS A‑1 |
APPENDIX B - | CONTINGENT TOP HEAVY PLAN RULES B‑1 |
APPENDIX C - | 401(k), 401(m) & 402(g) COMPLIANCE C‑1 |
APPENDIX D - | LOAN POLICY D‑1 |
(a) | Total Account - for convenience of reference, a Participant’s entire interest in the Fund, including the Participant’s Deferral Contribution Account, Safe Harbor Contribution Account, Regular Matching Contribution Account, Qualified Non‑Elective Contribution Account, Regular Employer Contribution Account, and Rollover Account. |
(b) | Deferral Contribution Account - the Account maintained for each Participant to which are credited the Employer contributions made in consideration of such Participant’s elective contributions pursuant to Section 3.2 (or comparable provisions of the Prior Plan Statement, if any), together with any increase or decrease thereon. |
(c) | Qualified Non‑Elective Contribution Account - the Account maintained for each Participant to which is credited the Participant’s allocable share of qualified non‑elective contributions made pursuant to the provisions of the Prior Plan Statement, together with any increase or decrease thereon. |
(d) | Safe Harbor Contribution Account - the Account maintained for each Participant to which is credited the Participant’s allocable share of the Employer matching contributions made pursuant to Section 3.3 or made pursuant to Section 3.3 of Appendix C (or comparable provisions of the Prior Plan Statement, if any), together with any increase or decrease thereon. |
(e) | Regular Matching Contribution Account - the Account maintained for each Participant to which is credited the Participant’s allocable share of the Employer discretionary matching contributions made pursuant to Section 3.4 (or comparable provisions of the Prior Plan Statement, if any), together with any increase or decrease thereon. |
(f) | Regular Employer Contribution Account - the Account maintained for each Participant to which is credited the Participant’s allocable share of the Employer non‑elective contributions made pursuant to Section 3.5 (or comparable provisions of the Prior Plan Statement, if any), together with any increase or decrease thereon. |
(g) | Rollover Account - the Account maintained for each Participant to which are credited the Participant’s rollover contributions made pursuant to Section 3.7 (or comparable provisions of the Prior Plan Statement, if any), together with any increase or decrease thereon. |
(a) | Period of Service. Except as provided below, an employee’s Eligibility Service as of any date shall be equal to the employee’s Period of Service determined as of that same date. |
(b) | Period of Severance. No Eligibility Rule of Parity. If an employee has a Period of Severance and returns thereafter to employment with the Employer or an Affiliate, both employment before and employment after such Period of Severance shall be taken into account in computing Eligibility Service. |
(a) | Excluded Items. In determining a Participant’s Eligible Compensation there shall be excluded all of the following: (i) reimbursements or other expense allowances, moving expense payments and other similar payments, (ii) welfare and fringe benefits (both |
(b) | Pre‑Participation Employment. Remuneration paid by the Employer attributable to periods prior to the date the Participant became a Participant in the Plan shall not be taken into account in determining the Participant’s Eligible Compensation. |
(c) | Non‑Eligible Employment. Remuneration paid by the Employer for employment that is not Eligible Employment shall not be taken into account in determining a Participant’s Eligible Compensation. |
(d) | Attribution to Periods. A Participant’s Eligible Compensation shall be considered attributable to the period in which it is actually paid and not when earned or accrued. |
(e) | Multiple Employers. If a Participant is employed by more than one Employer in a Plan Year, such Participant’s Eligible Compensation shall be the Participant’s total Eligible Compensation from all Employers (that is, a separate amount of Eligible Compensation shall not be determined for each Employer). |
(f) | Annual Maximum. A Participant’s Eligible Compensation for a Plan Year shall not exceed the annual compensation limit under section 401(a)(17) of the Code, which is Two Hundred Thousand Dollars ($200,000) for the Plan Year beginning in 2002 (as adjusted under the Code and by the Secretary of the Treasury for cost of living increases) (e.g., $255,000 in 2013). If a Participant who has a Salary Reduction Election in effect earns compensation in excess of the annual compensation limit at any time during the Plan Year, such Participant may continue to make elective contributions with respect to compensation that would qualify as Eligible Compensation but for the annual limit, but only to the extent that such Participant’s total elective contributions for the Plan Year do not exceed the percentage limit on reduction of Eligible Compensation for such Plan Year established pursuant to Section 2.3 or the dollar limit in effect for that taxable year under section 402(g) of the Code. |
(a) | Exclusions. Services classified by the Employer as being performed in the following categories of employment shall be excluded from Eligible Employment: |
i. | employment in a unit of employees whose terms and conditions of employment are subject to a collective bargaining agreement between the Employer and a union representing that unit of employees, unless (and to the extent) such collective bargaining agreement provides for the inclusion of those employees in the Plan, |
ii. | employment of a nonresident alien who is not receiving any earned income from the Employer which constitutes income from sources within the United States, |
iii. | employment of a United States citizen or a United States resident alien outside the United States unless and until the Committee shall declare such employment to be Eligible Employment (if such a designation is made, the Committee also shall specify the extent to which the compensation payable to such employee by the Employer, the foreign Affiliate, or both shall be recognized for purposes of the Plan), and |
iv. | employment in a division or facility of the Employer which is not in existence on January 1, 2013 (that is, was acquired, established, founded or produced by the liquidation or similar discontinuation of a separate subsidiary after January 1, 2013) unless and until the Committee shall declare such employment to be Eligible Employment. |
(b) | Non‑Employees. Services performed for the Employer by an individual who is not classified by the Employer as an employee on both payroll and personnel records shall not be considered Eligible Employment. Without limiting the generality of the foregoing, such services shall include services performed by an individual classified by the Employer as a Leased Employee, leased owner, leased manager, shared employee, shared leased employee, temporary worker, independent contractor, contract worker, agency worker, freelance worker or other similar classification. |
(c) | Loaned Employees. An individual is employed in Eligible Employment if the individual meets the following requirements: (1) the individual is employed in Eligible Employment with an Employer (the “transferor Employer”) that has adopted this Plan for all its employees in Eligible Employment, and then transfers or loans the individual to an Affiliate (the “recipient Employer”), (2) the transferor Employer continues to pay the individual through its payroll system, but the individual works for the recipient Employer on a substantially full‑time basis as a common law employee of the recipient Employer and (3) the recipient Employer has adopted the Plan only for the benefit of transferred or loaned employees who meet the requirements of (1) and (2) above. |
(d) | Effect of Classification. The Employer’s classification of an individual at the time of inclusion in or exclusion from Eligible Employment shall be conclusive for the purpose of the foregoing rules. No reclassification of an individual’s status with the Employer, for any reason, without regard to whether it is initiated by a court, governmental agency or otherwise and without regard to whether or not the Employer agrees to such reclassification, shall result in the individual being retroactively included in Eligible Employment. Notwithstanding anything to the contrary in this provision, however, the Committee may declare that a reclassified individual will be included in Eligible Employment prospectively. Any uncertainty concerning an individual’s classification shall be resolved by excluding the individual from Eligible Employment. |
(a) | Aggregation. Unless some or all of an employee’s service may be disregarded pursuant to other rules of this Plan Statement, all discontinuous Periods of Service shall be aggregated in determining the total of an employee’s Period of Service. A Period of Service shall be stated in years and days and when aggregating discontinuous periods of less than one (1) year, three hundred sixty five (365) days shall equal one (1) year. |
(b) | Service Spanning No. 1. If an employee quits, is discharged or retires from service with the Employer and all Affiliates and performs an Hour of Service within the twelve (12) months following the Severance from Service Date, that Period of Severance shall be deemed to be a Period of Service. |
(c) | Service Spanning No. 2. If an employee severs from service by reason of a quit, a discharge or retirement during the first twelve (12) months of an absence from service for any reason other than a quit, a discharge, retirement or death, and then performs an Hour of Service within the twelve (12) months following the date on which the employee was first absent from service, the Period of Severance shall be deemed to be a Period of Service. |
(d) | Special Rules. To the extent required under section 414 of the Code, services of Leased Employees, leased owners, leased managers, shared employees, shared leased employees, temporary workers, independent contractors, contract workers, agency workers, freelance workers and other similar classifications by the Employer or an Affiliate shall be taken into account as if such services were performed as a common law employee of the Employer for the purposes of determining Eligibility Service and Vesting Service. For purposes of the Plan, application of the leased employee rules under section 414(n) of the Code shall be subject to the following: (i) ”contingent services” shall mean services performed by a person for the Employer or an Affiliate during the period the person has not performed the services on a substantially full time basis for a period of at least twelve (12) consecutive months, (ii) except as provided in (iii), contingent services shall not be taken into account for purposes of determining Eligibility Service and Vesting Service, (iii) contingent services performed by a person who has become a Leased Employee shall be taken into account for purposes of determining Eligibility Service and Vesting Service, and (iv) all service performed as |
(a) | the date upon which an employee quits, is discharged or retires from service with the Employer and all Affiliates, or dies; or |
(b) | the date which is the first anniversary of the first day of a period in which an employee remains continuously absent from service (with or without pay) with the Employer and all Affiliates for any reason other than a quit, a discharge, retirement or death, such as vacation, holiday, sickness, disability, leave of absence or layoff. |
(a) | Period of Service. Except as provided below, an employee’s Vesting Service as of any date shall be equal to the employee’s Period of Service determined as of that same date. |
(b) | Vesting in Pre Five Year Severance Accounts. If an employee has a five (5) year (or longer) Period of Severance, the employee’s Regular Matching Contribution Account and Regular Employer Contribution Account shall be divided into the portion attributable to Employer contributions allocated with respect to employment before such Period of Severance and the portion attributable to Employer contributions allocated with respect to employment after such Period of Severance and employment after such five (5) year (or longer) Period of Severance shall not be taken into account in computing the Vested percentage in the employee’s Regular Matching Contribution Account and Regular Employer Contribution Account attributable to Employer contributions allocated with respect to employment before such five (5) year (or longer) Period of Severance. |
(c) | Vesting in Post Five Year Severance Accounts. Except as provided in the following sentences of this paragraph, if an employee has a Period of Severance and returns thereafter to employment with the Employer or an Affiliate, both employment before and employment after such Period of Severance shall be taken into account in computing the Vested percentage in the employee’s Regular Matching Contribution Account and Regular Employer Contribution Account attributable to Employer contributions allocated with respect to employment after such Period of Severance. If, however, the employee does not have any Vested interest in a Regular Matching Contribution Account or a Regular Employer Contribution Account upon the occurrence of a Period of Severance which equals or exceeds in length the greater of five (5) years or the employee’s prior Vesting Service, such prior Vesting Service shall be disregarded. Any Vesting Service disregarded by a prior application of this paragraph need not thereafter be taken into account. |
(a) | Catch‑up elective contributions shall be accounted for separately from other elective contributions. |
(b) | A Participant’s catch‑up elective contributions shall be credited to that Participant’s Deferral Contribution Account. |
(a) | Section 402(g) Annual Limit. Catch‑up elective contributions shall not be subject to the annual contribution limit under section 402(g) of the Code and Section 2.3 of this Plan Statement, but shall be subject to the applicable annual contribution limit specified in section 414(v) of the Code (e.g., $5,500 for 2013). |
(b) | ADP Testing. Catch‑up elective contributions shall not be subject to the average deferral percentage test under section 401(k) of the Code and Appendix C of this Plan Statement. |
(c) | § 415(c) Annual Addition Limit. Catch‑up elective contributions shall not be subject to the limitation on annual additions to the Participant’s accounts under section 415(c) of the Code and Appendix A of this Plan Statement. |
(a) | the Participant is an employee of the Employer or an Affiliate on the last day of the Plan Year (whether or not such employment is classified as Eligible Employment), or |
(b) | the Participant terminates employment with the Employer within the Plan Year by reason of death, Disability or retirement at or after the Participant’s Early Retirement Age. |
(a) | As named fiduciary and Investment Manager of the Employer Stock Fund, the Employer Stock Fund Fiduciary shall at all times have the exclusive fiduciary authority and responsibility to exercise the following powers: |
i. | to restrict the investment of new contributions in the Employer Stock Fund; |
ii. | to restrict the transfer of Participant Accounts into the Employer Stock Fund; |
iii. | to eliminate the Employer Stock Fund as an investment option under the Plan and to sell or otherwise dispose of all of the shares of Principal Sponsor common stock held in the Employer Stock Fund; |
iv. | to restrict the transfer of Participant Account Balances out of the Employer Stock Fund during any period in which the Employer Stock Fund Fiduciary is directing the sale or other disposition of the shares of Principal Sponsor common stock in the Employer Stock Fund; |
v. | to designate an alternative investment fund available under the Plan for the temporary investment of any proceeds from any sale or other disposition of Principal Sponsor common stock, following the completion of such sale or other disposition, pending participant directions to the trustee of the Plan with respect to the investment of such proceeds; |
vi. | to determine from time to time the percentage of the Employer Stock Fund that shall be invested in short‑term investments to facilitate Participant transactions into and out of the Employer Stock Fund and |
vii. | to instruct the Trustee with respect to the foregoing matters. |
(b) | The Trustee shall not vote any shares of the Principal Sponsor’s common stock which have voting rights owned by the Plan except as directed below. Furthermore, the Trustee shall not exercise dissenters’ rights with respect to such shares owned by the Plan except as directed below. As soon as practicable after notice of any shareholders’ meeting is received by the Trustee from the issuer of such securities, the Principal Sponsor shall cause the Committee or its administrative delegate to prepare and deliver to each Participant and Beneficiary of a deceased Participant under this Plan a form of proxy (and related materials, all of which shall be the same in form and content as are issued to shareholders in general) instructing the Trustee as to how it shall vote at such meeting, or any adjournment thereof, or exercise dissenters’ rights for, that number of shares of Principal Sponsor common stock which have voting rights, or dissenters’ rights, as applicable, actually held by the Plan in the Participant’s or Beneficiary’s Account. The Trustee shall vote all shares which have voting rights (or exercise dissenters’ rights for shares which have such rights) held by the Plan for which it has received instructions from Participants and Beneficiaries. The combined fractional shares of Participants and Beneficiaries of deceased Participants shall be voted to the extent possible to reflect the instructions of the Participant or Beneficiary to whose Accounts the fractional shares are allocated. The Trustee shall not honor or recognize any proxy given by any Participant or Beneficiary to any person other than the Trustee. The instructions received by the Trustee from Participants and Beneficiaries shall be held by the Trustee in confidence and shall not be divulged or |
(c) | Upon the receipt by the Trustee of a tender or exchange offer for some or all of the Principal Sponsor’s shares of common stock held in the Employer Stock Fund, the Principal Sponsor shall cause the Committee or its administrative delegate to prepare and deliver to each Participant and Beneficiary a notification (and related materials, all of which shall be the same in form and content as are issued to shareholders in general) of the existence of such an offer and shall solicit from each such Participant and Beneficiary binding directions with respect to whether the Trustee should tender the shares held for the benefit of such Participant or Beneficiary. The Trustee shall tender shares for which it has received timely directions from Participants and Beneficiaries, as directed. The combined fractional shares of Participants and Beneficiaries shall be tendered (or not) to the extent possible to reflect the directions of Participants and Beneficiaries with fractional shares. The directions received by the Trustee from Participants and Beneficiaries shall be held by the Trustee in confidence and shall not be divulged or released to any person, including officers or employees of the Principal Sponsor, except as necessary to administer the Plan. The Trustee shall not tender any shares for which it has not timely received instructions. If the Trustee shall sell any of a Participant’s or Beneficiary’s shares pursuant to the Participant’s or Beneficiary’s directions, the proceeds from such sale shall be reinvested in the manner elected by the Participant (or Beneficiary) or, in the absence of such an election, in the manner established by the Employer Stock Fund Fiduciary, which shall not provide for reinvestment in common shares of the Principal Sponsor. |
(d) | The Employer Stock Fund Fiduciary shall have the exclusive authority and responsibility to determine whether, when and on what terms to override the directions of Participants and Beneficiaries or the terms of the Plan with respect to voting, tender decisions and exercise of dissenters’ rights if the Employer Stock Fund Fiduciary determines that the Participants’ or Beneficiaries’ directions would be clearly imprudent under ERISA. |
(h) | Participants, Beneficiaries and Alternate Payees may give investment instructions to the Trustee at least once every three months; |
(i) | the Trustee must follow the investment instructions of Participants, Beneficiaries and Alternate Payees that comply with the Plan’s operational rules, provided that the Trustee may in any event decline to follow any investment instructions that: |
(i) | would result in a prohibited transaction described in section 406 of ERISA or section 4975 of the Code; |
(ii) | would result in the acquisition of an asset that might generate income which is taxable to the Plan; |
(iii) | would not be in accordance with the documents and instruments governing the Plan insofar as they are consistent with Title I of ERISA; |
(iv) | would cause a fiduciary to maintain indicia of ownership of any assets of the Plan outside of the jurisdiction of the district courts of the United States other than as permitted by section 404(b) of ERISA and Department of Labor regulation section 2050.404b‑1; |
(v) | would jeopardize the Plan’s tax status under the Code; |
(vi) | could result in a loss in excess of a Participant’s, Beneficiary’s or Alternate Payee’s Account balance; |
(j) | Participants, Beneficiaries and Alternate Payees shall be periodically informed of actual expenses to their Accounts which are imposed by the Plan and which are related to their Plan investment decisions. |
(k) | With respect to any Subfund consisting of Employer securities and intended to satisfy the requirements of section 404(c) of ERISA, (i) Participants, Beneficiaries and Alternate Payees shall be entitled to all voting, tender and other rights appurtenant to the ownership of such securities, (ii) procedures shall be established to ensure the confidential exercise of such rights, except to the extent necessary to comply with federal and state laws not preempted by ERISA, and (iii) the Trustee or other independent fiduciary designated by the Committee shall ensure the sufficiency of and compliance with such confidentiality procedures. |
When the Participant Has Completed the Following Years of Vesting Service: | The Vested Portion of the Regular Contribution Accounts Will Be: |
Less than 2 years | —% |
2 years but less than 3 years | 20% |
3 years but less than 4 years | 40% |
4 years but less than 5 years | 60% |
5 years or more | 100% |
(a) | the Participant’s death, |
(b) | the Participant’s attainment of Early Retirement Age, |
(c) | the Participant’s Disability, |
(d) | a partial termination of the Plan which is effective as to the Participant, or |
(e) | a complete termination of the Plan or a complete discontinuance of Employer contributions hereto. |
(a) | the Participant’s death; |
(b) | the Participant’s severance from employment, whether voluntary or involuntary; |
(c) | the attainment of age seventy and one‑half (70‑1/2) years by a Participant who is a five percent (5%) owner (as defined in Appendix B) at any time during the year in which the Participant attained age seventy and one‑half (70‑1/2) years and the crediting of any amounts to such a Participant’s Account after such time; or |
(d) | the Participant’s Disability; |
(a) | the occurrence after an Event of Maturity of a five (5) year (or longer) Period of Severance, |
(b) | the distribution after an Event of Maturity to (or with respect to) a Participant of the entire Vested portion of the Total Account of the Participant, |
(c) | the death of the Participant at a time and under circumstances which do not entitle the Participant to be fully (100%) Vested in the Participant’s Total Account, or |
(d) | the Event of Maturity of a Participant who has no Vested interest in the Participant’s Total Account. |
(a) | Exception for Small Amounts. If a Participant whose Vested Total Account does not exceed One Thousand Dollars ($1,000) incurs an Event of Maturity, then such Vested Total Account shall be distributed automatically in a single lump sum as soon as administratively practicable following such Event of Maturity without an application for distribution. A Participant who has no Vested interest in the Participant’s Total Account as of the Participant’s Event of Maturity shall be deemed to have received an immediate distribution of the Participant’s entire interest in the Plan as of such Event of Maturity. |
(b) | Exception for Required Distributions. If no application for distribution has been timely received within a reasonable period of time before the date by which a minimum required distribution must be made pursuant to section 401(a)(9) of the Code, then such required distribution shall be automatically distributed without an application for distribution no later than the date by which such minimum required distribution must be made, pursuant to the terms of Section 7.8. |
(a) | Spousal Consent Not Required. Spousal consent shall not be required to make an age 70‑1/2 distribution to a married Participant. |
(b) | Sequence of Accounts. Each distribution made pursuant to this Section 7.2.1 shall be taken from the Participant’s Accounts in the following sequence: Rollover Account, Deferral Contribution Account, Qualified Non‑Elective Contribution Account, Safe Harbor Contribution Account, and the Vested portion of the Regular Matching Contribution Account. |
(c) | Coordination with Section 4.1. If a distribution is made from an Account which is invested in more than one (1) Subfund authorized and established under Section 4.1, the amount distributed shall be charged to each Subfund in the same proportions as the Account is invested in each Subfund. |
(a) | Purposes. Hardship distributions shall be allowed under Section 7.2.2 only if the Participant establishes that the hardship distribution is to be made for one of the following purposes: |
i. | expenses for (or necessary to obtain) medical care for the Participant, the Participant’s spouse or any dependents of the Participant (as defined in section 152 of the Code and without regard to sections 152(b)(1), 152(b)(2) and 152(d)(1)(B) of the Code) that are deductible under section 213(d) of the Code (determined without regard to whether the expenses exceed seven and one‑half percent (7.5%) of adjusted gross income) and that are not reimbursed or eligible for reimbursement from any source, |
ii. | costs directly related to the purchase of a principal residence for the Participant (including a reasonable down payment, but excluding mortgage payments), |
iii. | payment of tuition, related educational fees and room and board expenses for the next twelve (12) months of post‑secondary education for the Participant, or the Participant’s spouse, children or dependents (as defined in section 152 of the Code and without regard to sections 152(b)(1), 152(b)(2) and 152(d)(1)(B) of the Code), |
iv. | payments necessary to prevent the eviction of the Participant from the Participant’s principal residence or foreclosure on the mortgage of that principal residence, |
v. | payments for burial or funeral expenses of the Participant’s deceased parent, spouse, children or dependents (as defined in section 152 of the Code and without regard to section 152(d)(1)(B) of the Code), or |
vi. | expenses for the repair of damage to the Participant’s principal residence that would qualify for the casualty deduction under section 165 of the Code (determined without regard to whether the loss exceeds ten percent (10%) of adjusted gross income). |
(a) | Limitations. In no event shall the cumulative amount of hardship distributions withdrawn from a Participant’s Deferral Contribution Account exceed the amount of contributions to those Accounts made pursuant to Section 3.2 (i.e., hardship distributions from those Accounts shall not include any earnings on such contributions or any curative contributions made pursuant to Appendix C). The amount of the hardship distribution shall not exceed the amount of the Participant’s immediate and heavy financial need; provided, however, that the amount of the immediate and heavy financial need may include amounts necessary to pay any federal, state, or local income taxes or penalties reasonably anticipated to result from the distribution. In addition, a hardship distribution which includes a portion of the Participant’s Deferral Contribution Account shall not be allowed unless the Participant has obtained all distributions and all nontaxable loans (at the time of the loan) currently available under all plans maintained by the Employer and Affiliates. Other funds are not currently available unless the funds are available prior to or coincidently with the date the hardship distribution is available. |
(b) | Spousal Consent Not Required. Spousal consent shall not be required to make a hardship distribution to a married Participant. |
(c) | Coordination with Other Plans. The rules described in this Section 7.2.1(d) apply only if the hardship distribution includes a portion of the Participant’s Deferral Contribution Account. The Participant’s Salary Reduction Election and elective contributions and employee contributions under all other plans maintained by the Employer and Affiliates shall be canceled for six (6) months after receipt of a hardship distribution and shall not be automatically reinstated. Thereafter, the Participant may, upon giving prior notice to the Committee, enter into a new Salary Reduction Election effective as of any subsequent Enrollment Date following such six (6) month period, provided the Participant is in Eligible Employment on that date. For the purposes of this Section 7.2.2, all other plans maintained by the Employer and Affiliates shall mean all qualified and nonqualified plans of deferred compensation maintained by the Employer and Affiliates (including stock option, stock purchase or similar plans). |
(d) | Sequence of Accounts. Each hardship distribution made pursuant to this Section 7.2.2 shall first be taken from and charged to the Participant’s Accounts in the following sequence: |
(e) | Coordination with Section 4.1. If the hardship distribution is made from an Account which is invested in more than one (1) Subfund authorized and established under Section 4.1, the amount withdrawn shall be charged to each Subfund in the same proportions as the Account is invested in each Subfund. |
(a) | Exception for Small Amounts. Upon the death of a Participant whose Vested Total Account does not exceed One Thousand Dollars ($1,000), such Participant’s Vested Total Account shall be distributed to the Beneficiary in a single lump sum as soon as administratively practicable following such Participant’s death without an application for distribution. The value of a Participant’s Vested Total Account shall be determined by including that portion of the Account that is attributable to rollover contributions (and earnings allocable thereto) within the meaning of sections 402(c), 403(a)(4), 403(b)(8), 408(d)(3)(A)(ii) and 457(e)(16) of the Code. |
(b) | Exception for Required Distributions. If no application has been timely received within a reasonable period of time before the date by which distributions are required to be made pursuant to section 401(a)(9) of the Code or, if earlier, pursuant to the Plan, then such required distribution shall be distributed automatically in a lump sum without an application for distribution, pursuant to Section 7.8. |
(a) | fails to designate a Beneficiary, |
(b) | designates a Beneficiary and thereafter such designation is revoked without another Beneficiary being named, or |
(c) | designates one or more Beneficiaries and all such Beneficiaries so designated fail to survive the Participant, |
(a) | a legally adopted child and the adopted child’s lineal descendants always shall be lineal descendants of each adoptive parent (and of each adoptive parent’s lineal ancestors); |
(b) | a legally adopted child and the adopted child’s lineal descendants never shall be lineal descendants of any former parent whose parental rights were terminated by the adoption (or of that former parent’s lineal ancestors); except that if, after a child’s parent has died, the child is legally adopted by a stepparent who is the spouse of the child’s surviving parent, the child and the child’s lineal descendants shall remain lineal descendants of the deceased parent (and the deceased parent’s lineal ancestors); |
(c) | if the person (or a lineal descendant of the person) whose issue are referred to is the parent of a child (or is treated as such under applicable law) but never received the child into that parent’s home and never openly held out the child as that parent’s child (unless doing so was precluded solely by death), then neither the child nor the child’s lineal descendants shall be issue of the person. |
(a) | If there is not sufficient evidence that a Beneficiary was living at the time of the death of the Participant, it shall be deemed that the Beneficiary was not living at the time of the death of the Participant. |
(b) | The automatic Beneficiaries specified in Section 7.4.3 and the Beneficiaries designated by the Participant shall become fixed at the time of the Participant’s death so that, if a Beneficiary survives the Participant but dies before the receipt of all payments due such Beneficiary hereunder, such remaining payments shall be payable to the representative of such Beneficiary’s estate. |
(c) | If the Participant designates as a Beneficiary the person who is the Participant’s spouse on the date of the designation, either by name or by relationship, or both, the dissolution, annulment or other legal termination of the marriage between the Participant and such person shall automatically revoke such designation. (The foregoing shall not prevent the Participant from designating a former spouse as a Beneficiary on a form signed by the Participant and received by the Committee after the date of the legal termination of the marriage between the Participant and such former spouse, and during the Participant’s lifetime.) |
(d) | Any designation of a nonspouse Beneficiary by name that is accompanied by a description of relationship to the Participant shall be given effect without regard to whether the relationship to the Participant exists either then or at the Participant’s death. |
(e) | Any designation of a Beneficiary only by statement of relationship to the Participant shall be effective only to designate the person or persons standing in such relationship to the Participant at the Participant’s death. |
(a) | the Committee clearly informs the distributee that the distributee has a right to a period of at least thirty (30) days after receiving such notices to consider whether or not to elect distribution; |
(b) | the distributee, after receiving the notice, affirmatively elects a distribution; and |
(c) | the distributee may revoke an affirmative distribution election by notifying the Committee of such revocation prior to the date as of which such distribution is to be made. |
(a) | Eligible rollover distribution means any distribution of all or any portion of a Vested Total Account to a distributee who is eligible to elect a direct rollover except (i) any distribution that is one of a series of substantially equal installments payable not less frequently than annually over the life expectancy of the distributee or the joint and last survivor life expectancy of such distributee and the distributee’s designated Beneficiary, and (ii) any distribution that is one of a series of substantially equal installments payable not less frequently than annually over a specified period of ten (10) years or more, and (iii) any distribution to the extent such distribution is required under section 401(a)(9) of the Code, and (iv) any hardship distribution, and (v) 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). |
(b) | Eligible retirement plan means (i) an individual retirement account described in section 408(a) of the Code, or (ii) an individual retirement annuity described in section 408(b) of the Code, or (iii) a plan described in section 403(a) of the Code or an annuity contract described under section 403(b) of the Code, or (iv) a qualified trust described in section 401(a) of the Code that accepts the eligible rollover distribution, or (v) an eligible plan under section 457(b) of the Code which is maintained by a state, political subdivision of a state, or any agency or instrumentality of a state or political subdivision of a state and which agrees to separately account for amounts transferred into such plan from this Plan. The definition of eligible retirement plan shall also apply in the case of a distribution to a surviving spouse, or to a spouse or former spouse who is an alternate payee. |
(c) | Direct rollover means the payment of an eligible rollover distribution by the Plan to the eligible retirement plan specified by the distributee who is eligible to elect a direct rollover. |
(d) | Special Rule For Nonspouse Beneficiaries. A distributee who is a Beneficiary and who is not the surviving spouse of a Participant or an alternate payee may elect, at the time and the manner prescribed by the Committee, to have all or any portion of such distributee’s eligible rollover distribution paid directly in a trustee‑to‑trustee transfer to an individual retirement account or annuity described in sections 408(a) or (b) of the Code, which is treated as an inherited individual retirement account or annuity within the meaning of section 408(d)(3)(C) of the Code. Any distribution to a nonspouse Beneficiary which is payable prior to January 1, 2010, shall not be subject |
(e) | Qualified Rollover Contribution to Roth IRA. Effective for distributions made on or after January 1, 2008, a distributee may elect to have all or a portion of an eligible rollover distribution rolled over to a Roth IRA described in section 408A of the Code. However, for distributions made before January 1, 2010, the distributee shall not be eligible to make a qualified rollover contribution to a Roth IRA if the distributee’s adjusted gross income exceeds One Hundred Thousand Dollars ($100,000) or the distributee is a married individual filing a separate return. |
(a) | to the court‑appointed guardian or conservator of such Participant, Beneficiary or Alternate Payee, or |
(b) | if there is no court‑appointed guardian or conservator, to the lawfully authorized representative of the Participant, Beneficiary or Alternate Payee (and the Committee, in its sole discretion, shall determine whether a person is a lawfully authorized representative for this purpose), or |
(c) | to an institution entrusted with the care or maintenance of the minor, incapacitated or disabled Participant, Beneficiary or Alternate Payee, provided, however, such institution has satisfied the Committee, in its sole discretion, that the payment will be used for the best interest and assist in the care of such Participant, Beneficiary or Alternate Payee, and provided further, that no prior claim for said payment has been made by a person described in (a) or (b) above. Any payment made in accordance with the foregoing provisions of this Section shall constitute a complete discharge of any liability or obligation of the Employer, the Committee, the Trustee and the Fund therefor. |
(a) | Lost Distributees With Required Minimum Distributions or With Small Balances. If distribution of any Vested Total Account is required to be made without application to a Participant pursuant to Section 7.1.1(a) or (b) or to a Beneficiary pursuant to Section 7.3.1(a) or (b) and such Participant or Beneficiary cannot be located after reasonable efforts have been made to find such Participant or Beneficiary |
(b) | Lost Distributees Who Request Distribution. If a Participant or a Beneficiary requests distribution of the Participant’s Vested Total Account and distribution is made to such Participant or Beneficiary and the Committee or its designee subsequently determines that such Participant or Beneficiary failed to provide the Committee or its designee with a current address and such Participant or Beneficiary cannot be located after reasonable efforts have been made to find such Participant or Beneficiary (the “lost distributee”), the amount distributed to such Participant or Beneficiary shall be forfeited as soon as administratively practicable after the date such lost distributee requested a distribution. |
(c) | Later Location of Lost Distributee. If a lost distributee is later located and files an application for distribution with the Committee, the dollar amount forfeited (and only that amount) shall be distributed to such lost distributee as soon as administratively practicable following the approval of such application by the Committee or its designee. |
(d) | Restoration Amount. The amount necessary to make any restorations pursuant to this Section 7.5.6 shall first come from the forfeitures as provided in Section 6.2. If such forfeitures are not adequate for this purpose, the Employer shall make a contribution adequate to make the restoration. |
(a) | General Rule. The required beginning date is the later of (i) the April 1 following the calendar year in which the Participant attains age seventy and one‑half (70‑1/2) years, or (ii) the April 1 following the calendar year in which the Participant terminates employment. |
(b) | Special Rule for Five Percent (5%) Owner. If the Participant is a five percent (5%) owner (as defined in Appendix B) at any time during the Plan Year in which such Participant attains age seventy and one‑half (70‑1/2) years, the required beginning date for such Participant shall be the April 1 following the calendar year in which the Participant attains age seventy and one‑half (70‑1/2) years. If any amounts are thereafter credited to such Participant’s Accounts, then for purposes of Section 7.1.1(b) each subsequent December 31 shall be treated as a required beginning date. |
(c) | Special Election. A Participant who is not a five percent (5%) owner (as defined in Appendix B) may elect to commence minimum required distributions upon the Participant’s required beginning date as if he or she were a five percent (5%) owner. |
(a) | Lump Sum. Distribution may be made in a single lump sum payment no later than the Participant’s required beginning date. |
(b) | Required Minimum Distributions. Distribution may be made in a series of substantially equal annual installments commencing no later than the Participant’s required beginning date, over a period of time determined by reference to the applicable table under section 1.401(a)(9)‑9 of the income tax regulations. The amount of the distribution required to be made for each calendar year (the “distribution year”) shall be determined by dividing the amount of the Total Account as of the last Valuation Date in the calendar year immediately preceding the distribution year (such preceding calendar year being the “valuation year”) by the distribution factor for the distribution year. The amount of the Total Account as of the last Valuation Date in the valuation year shall be increased by the amount of any contributions allocated to the Total Account during the valuation year and after such Valuation Date (including contributions, if any, made after the end of the valuation year which are allocated as of dates in the valuation year). The amount of the Total Account shall be decreased by distributions made in the valuation year and after such Valuation Date. The Participant may elect at any time to accelerate any remaining payments and receive a partial or single lump sum distribution; provided, that only one such change may be made in any Plan Year |
(c) | Distribution Factor. The distribution factor shall be determined from the applicable table under section 1.401(a)(9)‑9 of the income tax regulations and shall be based upon an individual’s attained age on the individual’s birthday in the distribution year. |
(a) | Death of Participant Before Required Beginning Date. If the Participant’s death occurs before the Participant’s required beginning date, then the Participant’s Beneficiary may select between the following forms of distribution: |
i. | Lump Sum. Distribution may be made in a single lump sum payment, which shall be made not later than December 31 of the calendar year in which occurs the fifth (5th) anniversary of the death of the Participant. |
ii. | Minimum Required Amounts. Distribution may be made in a series of substantially equal annual installments commencing no later than December 31 of the year following the year of the Participant’s death (or, if the sole Beneficiary is the Participant’s surviving spouse, then, if later, December 31 of the year in which the Participant would have attained age |
iii. | Special Rule. If the Participant’s spouse is the Participant’s sole Beneficiary and such spouse dies before distributions are required to begin to the spouse under this Section 7.8.4(a), then the timing of distributions to the estate of the Participant’s spouse under this Section 7.8.4(a) shall be determined as if such spouse were the Participant. |
(b) | Participant’s Death On or After Required Beginning Date. If the Participant’s death occurs on or after the Participant’s required beginning date, then the Participant’s Beneficiary may select between the following forms of distribution: |
i. | Lump Sum. Distribution may be made in a single lump sum payment, which shall be made not later than December 31 of the calendar year in which occurs the first (1st) anniversary of the death of the Participant. |
ii. | Minimum Required Amounts. Distribution may be made in a series of substantially equal installments commencing no later than December 31 of the year following the year of the Participant’s death (or, if the sole Beneficiary is the Participant’s surviving spouse, then, if later, December 31 of the year in which the Participant would have attained age seventy and one‑half (70‑1/2) years) and payable annually over the remaining life expectancy of the “designated beneficiary” whose life expectancy may be used under section 1.401(a)(9)‑4 of the income tax regulations or, if longer, the remaining life expectancy of the Participant. If there is no such “designated beneficiary,” then such payments may be made over a period of time that will not extend beyond the remaining life expectancy of the Participant. The Beneficiary may elect at any time to accelerate any remaining payments and receive a partial or single lump sum distribution; provided, that only one such change may be made in any Plan Year. |
(c) | Substantially Equal. If distributions are in the form of installments payable over a period of time determined by the applicable table under section 1.401(a)(9)‑9 of the income tax regulations, the amount of the distribution required to be made for each calendar year (the “distribution year”) shall be determined by dividing the amount of the Total Account as of the last Valuation Date in the calendar year immediately preceding the distribution year (such preceding calendar year being the “valuation year”) by the remaining life expectancy as of the distribution year. The amount of the Total Account as of the last Valuation Date in the valuation year shall be increased by the amount of any contributions allocated to the Total Account during the valuation year and after such Valuation Date (including contributions, if any, made after the end |
(d) | Remaining Life Expectancy. Remaining life expectancy shall be determined by use of the Single Life Table in section 1.401(a)(9)‑9 of the income tax regulations. The Participant’s remaining life expectancy is based upon the Participant’s age in the Participant’s year of death. A Beneficiary’s remaining life expectancy is based upon the Beneficiary’s age in the year following the year of the Participant’s death. The remaining life expectancies determined for the initial year are reduced by one for each subsequent year, except that if the Participant’s spouse is the Participant’s sole Beneficiary, then such spouse’s remaining life expectancy is recalculated each year. |
(e) | Multiple Beneficiaries. If more than one person (including persons that are not natural persons) is designated as a Beneficiary of a Total Account, then the Committee may (but is not required to) direct the Trustee to establish a separate subaccount from such Total Account for each such person. If the Trustee does not establish subaccounts, then the following rules apply: |
(i) | references to “the Beneficiary” shall mean all such persons then entitled to payment; |
(ii) | unless all such persons satisfy the requirements for payment provided hereunder then the requirements shall not be satisfied; and |
(iii) | the Beneficiary’s life expectancy shall be determined under Q & A 7 of section 1.401(a)(9)‑5 and related sections of the income tax regulations. |
(a) | in any respect by resolution of the Compensation and Human Resources Committee of the Board of Directors; and |
(b) | by action of the Principal Sponsor’s Executive Vice President Chief Human Resources Officer for the purpose of complying with applicable laws and regulations, consenting on behalf of Principal Sponsor to the adoption of any of such plans by any Affiliates, adopting prior service crediting rules for the employees of acquired subsidiaries or other business units, authorizing mergers of plans maintained by such subsidiaries or other business units into this Plan, and changing the Plan design and administration in any way that does not significantly reduce benefits or significantly increase the Principal Sponsor’s funding or administrative costs for the Plan, and is not prohibited by applicable law; |
(a) | If the claim is denied in whole or in part, the VP Benefits shall notify the claimant of the adverse benefit determination within ninety (90) days after receipt of the claim. |
(b) | The ninety (90) day period for making the claim determination may be extended for ninety (90) days if the VP Benefits determines that special circumstances require an extension of time for determination of the claim, provided that the VP Benefits notifies the claimant, prior to the expiration of the initial ninety (90) day period, of the special circumstances requiring an extension and the date by which a claim determination is expected to be made. |
(a) | the specific reasons for the adverse determination; |
(b) | references to the specific provisions of the Plan Statement (or other applicable Plan document) on which the adverse determination is based; |
(c) | a description of any additional material or information necessary to perfect the claim and an explanation of why such material or information is necessary; and |
(d) | a description of the claim and review procedures, including the time limits applicable to such procedure, and a statement of the claimant’s right to bring a civil action under ERISA section 502(a) following an adverse determination on review. |
(a) | The sixty (60) day period for deciding the claim on review may be extended for sixty (60) days if the Committee determines that special circumstances require an extension of time for determination of the claim, provided that the Committee notifies the claimant, prior to the expiration of the initial sixty (60) day period, of the special circumstances requiring an extension and the date by which a claim determination is expected to be made. |
(b) | In the event that the time period is extended due to a claimant’s failure to submit information necessary to decide a claim on review, the claimant shall have sixty (60) days within which to provide the necessary information and the period for making the claim determination on review shall be tolled from the date on which the notification of the extension is sent to the claimant until the date on which the claimant responds to the request for additional information or, if earlier, the expiration of sixty (60) days. |
(c) | The Committee’s review of a denied claim shall take into account all comments, documents, records, and other information submitted by the claimant relating to the claim, without regard to whether such information was submitted or considered in the initial benefit determination. |
(a) | the specific reasons for the denial; |
(b) | references to the specific provisions of the Plan Statement (or other applicable Plan document) on which the adverse determination is based; |
(c) | a statement that the claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to the claimant’s claim for benefits; |
(d) | a statement describing any voluntary appeal procedures offered by the Plan and the claimant’s right to obtain information about such procedures; and |
(e) | a statement of the claimant’s right to bring an action under ERISA section 502(a). |
(a) | If the disability claim is denied in whole or in part, the VP Benefits shall notify the claimant of the adverse benefit determination within forty‑five (45) days after receipt of the disability claim. |
(b) | The forty‑five (45) day period for making the determination may be extended for thirty (30) days, if the VP Benefits determines that an extension is necessary due to reasons beyond the control of the VP Benefits and notifies the claimant of the extension prior to the expiration of the initial forty‑five (45) day period. The thirty (30) day extension period can be further extended by another thirty (30) days (for a total of a |
(c) | In the event that a period of time is extended due to a claimant’s failure to submit information necessary to decide a disability claim, the claimant shall have forty five (45) days within which to provide the necessary information and the period for making the claim determination shall be tolled from the date on which the notification of extension is sent to the claimant until the date on which the claimant responds to the request for additional information or, if earlier, the expiration of forty‑five (45) days. |
(d) | Any notice of extension shall specifically explain: |
i. | the circumstances requiring the extension of time; |
ii. | the date by which a claim determination is expected to be made; |
iii. | the standards on which entitlement to a benefit is based; |
iv. | the unresolved issues that prevent a decision on the disability claim; and |
v. | the additional information needed to resolve those issues. |
(a) | the specific reasons for the adverse determination; |
(b) | references to the specific provisions of the Plan Statement (or other applicable Plan document) on which the adverse determination is based; |
(c) | a description of any additional material or information necessary to perfect the claim, and an explanation of why such material or information is necessary; |
(d) | a description of the claim and review procedures, and the time limits applicable to such procedures, including a statement of the claimant’s right to bring a civil action under section 502(a) of ERISA following an adverse benefit determination on review; |
(e) | if an internal rule, guideline, protocol, or other similar criterion was relied upon in making the adverse determination, either the specific rule, guideline, protocol, or other similar criterion; or a statement that such a rule, guideline, protocol, or other similar criterion was relied upon in making the adverse determination and that a copy of such rule, guideline, protocol, or other criterion will be provided free of charge to the claimant upon request; and |
(f) | if the adverse benefit determination is based on a medical necessity or experimental treatment or similar exclusion or limit, either an explanation of the scientific or clinical judgment for the determination applying the terms of the Plan to the claimant’s medical circumstances, or a statement that such explanation will be provided free of charge upon request. |
(a) | The forty‑five (45) day period for deciding the disability claim on review may be extended for forty‑five (45) days if the Committee determines that special |
(b) | In the event that a period of time is extended due to a claimant’s failure to submit information necessary to decide a disability claim, the claimant shall have forty‑five (45) days within which to provide the necessary information and the period for making the benefit determination shall be tolled from the date on which the notification of extension is sent to the claimant until the date on which the claimant responds to the request for additional information or, if earlier, the expiration of forty‑five (45) days. |
(c) | The Committee’s review of a denied disability claim shall: |
(iv) | take into account all comments, documents, records, and other information submitted by the claimant relating to the disability claim, without regard to whether such information was submitted or considered in the initial benefit determination; |
(v) | not afford deference to the initial adverse benefit determination; |
(vi) | be conducted by a decision maker(s) who is neither the decision maker(s) who made the initial adverse benefit determination that is the subject of the appeal, nor the subordinate of such individual(s); |
(vii) | if the adverse benefit determination is based in whole or in part on a medical judgment, consult with a health care professional who has the appropriate training and experience in the field of medicine involved in the medical judgment (such health care professional shall be an individual who is neither an individual who was consulted in connection with the adverse benefit determination that is subject of the appeal, nor the subordinate of any such individual); and |
(viii) | provide for the identification of the medical or vocational experts whose advice was obtained on behalf of the Plan in connection with a claimant’s adverse benefit determination, without regard to whether the advice was relied upon in making the benefit determination. |
(a) | the specific reasons for denial of the disability claim; |
(b) | the specific references to the pertinent provisions of the Plan Statement (or other applicable Plan document) on which the denial is based; |
(c) | a statement that the claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to the claimant’s claim for disability benefits; |
(d) | a statement describing any voluntary appeal procedures offered by the Plan and the claimant’s right to obtain information about such procedures; |
(e) | a statement of the claimant’s right to bring an action under section 502(a) of ERISA; |
(f) | if an internal rule, guideline, protocol, or other similar criterion was relied upon in making the adverse determination, either the specific rule, guideline, protocol, or other similar criterion; or a statement that such a rule, guideline, protocol, or other similar criterion was relied upon in making the adverse determination and that a copy of such |
(g) | if the adverse benefit determination is based on a medical necessity or experimental treatment or similar exclusion or limit, either an explanation of the scientific or clinical judgment for the determination applying the terms of the Plan to the claimant’s medical circumstances, or a statement that such explanation will be provided free of charge upon request; and |
(h) | the following statement: “You and your plan may have other voluntary alternative dispute resolutions options, such as mediation. One way to find out what may be available is to contact your local U.S. Department of Labor Office and your State insurance regulatory agency.” |
(a) | No inquiry or question shall be deemed to be a claim or a request for a review of a denied claim unless made in accordance with the established claim procedures. |
(b) | All decisions on claims and on requests for a review of denied claims shall be made by the VP Benefits or the Committee, as applicable, unless delegated. Such delegation may be implied or inferred. If the decision is delegated, all references to the VP Benefits or Committee, as applicable, in Section 11 shall be treated as references to the delegate. |
(c) | Claimants may be represented by a lawyer or other representative at their own expense, but the VP Benefits and the Committee reserve the right to require the claimant to furnish written authorization and establish reasonable procedures for determining whether an individual has been authorized to act on behalf of a claimant. A claimant’s representative shall be entitled to copies of all notices given to the claimant. |
(d) | The decision on a claim and on a request for a review of a denied claim may be provided to the claimant in electronic form instead of in writing at the discretion of the VP Benefits or the Committee. |
(e) | In connection with the review of a denied claim, the claimant or the claimant’s representative shall be provided, upon request and free of charge, reasonable access to, and copies of, all documents, records, and other information relevant to the claimant’s claim for benefits. |
(f) | The time period within which a benefit determination will be made shall begin to run at the time a claim or request for review is filed in accordance with the claims procedures, without regard to whether all the information necessary to make a benefit determination accompanies the filing. |
(g) | The claims and review procedures shall be administered with appropriate safeguards so that benefit claim determinations are made in accordance with governing plan documents and, where appropriate, the plan provisions have been applied consistently with respect to similarly situated claimants. |
(h) | For the purpose of this Section, a document, record, or other information shall be considered “relevant” if such document, record, or other information: (i) was relied upon in making the benefit determination; (ii) was submitted, considered, or generated in the course of making the benefit determination, without regard to whether such |
(i) | The VP Benefits or the Committee may, in its discretion, rely on any applicable statute of limitation or deadline as a basis for denial of any claim. |
(j) | The burden of proof in demonstrating any fact essential to the approval of any claim for benefits, including eligibility for any claimed benefit and the extent to which a claimed benefit is covered or payable in accordance with the Plan, shall at all times be the responsibility of the claimant. |
(a) | thirty (30) months after the claimant knew or reasonably should have known of the principal facts on which the claim is based, or |
(b) | six (6) months after the claimant has exhausted the claim and review procedures. |
(a) | to amend this Plan Statement in any manner that materially increases the cost of such Plan (except that the authority to make such amendments as are required to obtain or maintain the qualification of the Plan under sections 401(a) and 501(a) of the Code may be delegated); to terminate the Plan; |
(b) | to create or dissolve the Committee; to appoint or remove members of the Committee; |
(c) | to reduce, suspend or discontinue contributions to the Plan. |
(a) | establish rules for the functioning of the Committee, including the times and places for holding meetings, the notices to be given in respect of such meetings and the number of members who shall constitute a quorum for the transaction of business, |
(b) | organize and delegate to such of its members as it shall select authority to execute or authenticate rules, advisory opinions or instructions, and other instruments adopted or authorized by the Committee; adopt such bylaws or regulations as it deems desirable for the conduct of its affairs; appoint a secretary, who need not be a member of the Committee, to keep its records and otherwise assist the Committee in the performance of its duties; keep a record of all its proceedings and acts and keep all books of account, records and other data as may be necessary for the proper administration of the Plan; |
(c) | determine from the records of the Employer the compensation, service records, status and other facts regarding Participants and other employees, |
(d) | cause to be compiled at least annually, from the records of the Committee and the reports and accountings of the Trustee, a report or accounting of the status of the Plan and the Accounts of the Participants, and make it available to each Participant who shall have the right to examine that part of such report or accounting (or a true and correct copy of such part) which sets forth his benefits and his ratable interest in the Fund, |
(e) | prescribe forms to be used for applications for participation, distributions, withdrawals, notifications, etc., as may be required in the administration of the Plan, |
(f) | set up such rules, applicable to all Participants similarly situated, as are deemed necessary to carry out the terms of this Plan Statement, |
(g) | shall appoint the Employer Stock Fund Fiduciary (and in the event that an Employer Stock Fund Fiduciary shall resign or be removed by the Committee or shall otherwise cease to serve hereunder, the Committee shall appoint a successor Employer Stock Fund Fiduciary), |
(h) | have the authority to appoint or remove a Trustee or an Investment Manager, |
(i) | have the authority to direct the Trustee to return an Employer contribution that was made by mistake or which is not deductible; |
(j) | have the authority to consent to the adoption of the Plan by affiliated employers, to designate Affiliates, to establish conditions and limitations upon such adoption of the Plan by affiliated employers; |
(k) | perform all other acts reasonably necessary for administering the Plan and carrying out the provisions of this Plan Statement and performing the duties imposed on it by the Board of Directors of the Principal Sponsor, |
(l) | resolve all questions of administration of the Plan not specifically referred to in this section, |
(m) | delegate or redelegate to one or more persons, jointly or severally, and whether or not such persons are members of the Committee or employees of any Employer, such functions assigned to the Committee hereunder as it may from time to time deem advisable, and |
(n) | have the authority to amend this Plan Statement in any manner not reserved exclusively to the Board of Directors under Section 12.1(a). |
EMPLOYER | DATE OF PLAN ADOPTION |
Best Buy Co., Inc. (Principal Sponsor) | October 1, 1990 |
Best Buy Stores, L.P. | January 1, 1996 |
Best Buy Purchasing, LLC | October 6, 2000 |
BestBuy.com, LLC | January 1, 2000 |
Redline Entertainment, Inc.* | March 16, 2001 |
Musicland Stores Corporation | April 1, 2002, until June 16, 2003, when it ceased to be an Employer |
The Musicland Group, Inc. and its subsidiaries | April 1, 2002, until June 16, 2003, when they ceased to be Employers |
Best Buy Enterprise Services, Inc. | January 1, 2003 |
BBY Holdings International, Inc. | January 1, 2003 |
Nichols Distribution, LLC | January 1, 2003 |
Geek Squad, Inc. | May 1, 2003, until May 20, 2004, when it merged into Best Buy Stores, L.P. |
vpr Matrix, Inc.* | January 1, 2004 |
GarageSalePro, Inc. | April 1, 2004, until February 23, 2006, when it ceased to be an Employer |
eq‑life Stores, LLC | December 6, 2004, until May 27, 2006, when it ceased to be an Employer |
Magnolia Hi‑Fi, Inc. d/b/a Magnolia Audio Video | April 1, 2005 |
CultureRx | December 13, 2005, until November 13, 2008, when it ceased to be an Employer |
Best Buy Warehousing Logistics, Inc. | July 1, 2009 |
Pacific Sales Kitchen and Bath Centers, Inc. | November 1, 2009, for loaned employees described in Section 1.1.13(c) April 1, 2010, for all of employees in Eligible Employment |
BBY Services, Inc. | July 1, 2009 |
BBY Solutions, Inc. | July 1, 2009 |
BBY Connect, LLC | January 1, 2010 |
Napster, Inc. | March 18, 2011 |
mindSHIFT Technologies, Inc. | July 20, 2012 |
Partsearch Technologies, Inc. | September 28, 2012 |
EMPLOYERS ADOPTING THIS PLAN ONLY FOR A LOANED EMPLOYEES DESCRIBED IN SECTION 1.1.13(c) OF THIS PLAN | DATE OF PLAN ADOPTION FOR LOANED EMPLOYEES |
Pacific Sales Kitchen and Bath Centers, Inc. | November 1, 2009, but only through March 31, 2010 |
Speakeasy, Inc. | November 1, 2009 |
Napster, Inc. | November 1, 2009 until March 18, 2011 when the Napster 401(k) Plan merged into this Plan and the adoption was no longer for limited group |
RELATED EMPLOYERS SPONSORING ANOTHER QUALIFIED DEFINED CONTRIBUTION PLAN | DATE EMPLOYER BECAME RELATED | Code § 415 aggregated PLAN |
Speakeasy, Inc. | May 1, 2007 | Speakeasy, Inc. Employee Savings Trust** |
(i) | all employer contributions (including employer contributions of the Participant’s earnings reductions under section 401(k), section 403(b) and section 408(k) of the Code) allocable as of a date during such limitation year to the Participant under all defined contribution plans; |
(ii) | all forfeitures allocable as of a date during such limitation year to the Participant under all defined contribution plans; and |
(iii) | all Participant contributions made as of a date during such limitation year to all defined contribution plans. |
(i) | Forty Thousand Dollars ($40,000), as adjusted automatically for increases in the cost of living by the Secretary of the Treasury pursuant to section 415(d) of the Code, or |
(ii) | one hundred percent (100%) of the Participant’s §415 compensation for such limitation year. |
(i) | Contributions (other than elective deferrals) to a plan of deferred compensation to the extent the contributions are not includible in gross income for the year the contribution is added. |
(ii) | Amount realized from the exercise of a nonstatutory option or when restricted stock or other property either becomes freely transferable or is no longer subject to a substantial risk of forfeiture. |
(iii) | Amounts realized from the sale, exchange or other disposition of stock acquired under a statutory stock option. |
(iv) | Other amounts receiving special tax benefits such as premiums for group‑term life insurance (but only to the extent that the premiums are not includible in gross income and are not salary reduction amounts described in section 125 of the Code). |
(v) | Amounts paid or reimbursed by the employer for moving expenses incurred that are not deductible by the employee under section 217 of the Code. |
(vi) | Amounts described in section 104(a)(3), 105(a), or 105(h) of the Code that are includible in the gross income of the employee. |
(vii) | The value of a nonstatutory option (which is an option other than a statutory option as defined in §1.421‑1(b)) that is includible in the gross income of the employee for the taxable year in which granted. |
(viii) | Amounts includible in gross income upon making the election described in section 83(b) of the Code. |
(i) | Regular Pay. Regular pay (e.g., regular base pay, overtime, shift differential pay, commissions, bonuses and other similar compensation) shall be included if (A) it is paid not later than the end of the limitation year that includes the severance from employment date or, if later, two and one‑half (2‑1/2) months after the severance from employment date, and (B) it would have been paid if there had been no severance from employment. |
(ii) | Unused Leave. Payments of unused accrued bona fide sick leave, vacation or other leave shall be included if it is paid not later than the end of the limitation year that includes the severance from employment date or, if later, two and one‑half (2‑1/2) months after severance from employment. |
(iii) | NQDC. Payments of nonqualified unfunded deferred compensation plan shall be included if (A) it is received not later than the end of the limitation year that includes the severance from employment date or, if later, two and one‑half (2‑1/2) months after the severance from employment date, and (B) it would have been paid if there had been no severance from employment. |
(iv) | Actual USERRA and Disability. Payments of compensation paid to employees performing qualified military service (e.g., “differential pay”) and to employees who are totally and permanently disabled shall be included if the payments do not exceed the amounts the employee would have received if employment had continued. |
(v) | Imputed Disability Pay. The compensation an employee would have received for the limitation year shall be included if the following conditions are satisfied: (A) the employee is totally and permanently disabled within the meaning of section 22(e)(3) of the Code, and (B) either (x) the employee is not a highly compensated employee immediately before becoming disabled or (y) the terms of the plan provide for the continuation of contributions on behalf of all participants who are permanently and totally disabled for a fixed or determinable period, and (C) the plan provides that such amounts are taken into account for the purpose of making contributions, and (D) all contributions made with respect to such imputed compensation are nonforfeitable when made. |
(i) | Employer contributions to defined contribution pension plans (e.g., money purchase pension plans including target benefit pension plans). |
(ii) | Employer fixed (non‑discretionary, non‑matching) contributions to defined contribution profit sharing plans and stock bonus plans. |
(iii) | Employer discretionary (non‑matching) contributions to defined contribution profit sharing plans and stock bonus plans. |
(i) | Employee non‑Roth matched elective deferrals (within the meaning of section 402(g)(3) of the Code) to defined contribution profit sharing plans and stock bonus plans. |
(ii) | Employee Roth matched elective deferrals (within the meaning of section 402(g)(3) of the Code) to defined contribution profit sharing plans and stock bonus plans. |
(iii) | Employee matched after‑tax contributions to defined contribution profit sharing plans and stock bonus plans. |
(iv) | Employer non‑discretionary fixed matching contributions to defined contribution profit sharing and plans and stock bonus plans. |
(v) | Employer discretionary matching contributions to defined contribution profit sharing plans and stock bonus plans. |
(i) | Employee non‑Roth unmatched elective deferrals (within the meaning of section 402(g)(3) of the Code) to defined contribution profit sharing plans and stock bonus plans. |
(ii) | Employee Roth unmatched elective deferrals (within the meaning of section 402(g)(3) of the Code) to defined contribution profit sharing plans and stock bonus plans. |
(iii) | Employee unmatched after‑tax contributions to defined contribution profit sharing plans and stock bonus plans. |
(i) | All other contributions and allocations (but excluding forfeitures to be reallocated). |
(ii) | Forfeitures to be reallocated. |
(i) | the present value of the cumulative accrued benefits for key employees under all defined benefit plans included in such aggregation group, and |
(ii) | the aggregate of the accounts of key employees under all defined contribution plans included in such aggregation group, |
(i) | if the plan is a defined benefit plan, the present value of the cumulative accrued benefits for key employees exceeds sixty percent (60%) of the present value of the cumulative accrued benefits for all employees, and |
(ii) | if the plan is a defined contribution plan, the aggregate of the accounts of key employees exceeds sixty percent (60%) of the aggregate of all of the accounts of all employees. |
If the Participant Has Completed the Following Years of Vesting Service: | His Vested Percentage Shall Be: |
Less than 2 years | —% |
2 years but less than 3 years | 20% |
3 years but less than 4 years | 40% |
4 years but less than 5 years | 60% |
5 years but less than 6 years | 80% |
6 years or more | 100% |
(i) | five (5) years after the first date on which the Participant is subsequently reemployed by the employer, or |
(ii) | the close of the first period of five (5) consecutive one‑year breaks in service commencing after the distribution. |
(i) | two percent (2%) multiplied by the number of years of service with the Employer, or |
(ii) | twenty percent (20%). |
(i) | the Plan was not a top heavy plan for any Plan Year ending during such year of Vesting Service, or |
(ii) | such year of Vesting Service was completed in a Plan Year beginning before January 1, 1984, or |
(iii) | the service occurs during a Plan Year when the Plan benefits (within the meaning of section 410(b) of the Code) no key employee or former key employee. |
(i) | the years taken into account shall be properly adjusted for years not included in a year of service, and |
(ii) | a year shall not be taken into account if such year ends in a Plan Year beginning before January 1, 1984, or such year begins after the close of the last year in which the Plan was a top heavy plan. |
(i) | the total amount, for the Plan Year, of Employer contributions credited to the eligible employee’s Employer Matching Account excluding any Employer matching contributions of eligible HCEs that are forfeited pursuant to Sections 1.1.6 or 2.2.5 of this Appendix, and including, if the Committee elects, all or a portion of the amount of Employer contributions credited to the eligible employee’s Retirement Savings Account, provided that the 401(k) compliance testing under Section 2.1 of this Appendix is satisfied both with and without exclusion of such Employer contributions, to |
(ii) | the eligible employee’s compensation, as defined below for the portion of such Plan Year that the employee is an eligible employee. |
(i) | the sum of all such nondeductible voluntary contributions and Employer matching contributions, and if used to determine the contribution percentage of eligible employees, Employer contributions made pursuant to a deferral election or qualified nonelective contributions (within the meaning of section 401(m)(4)(C) of the Code), or both, under all such plans for the Plan Year, to |
(ii) | the eligible HCE’s compensation (as defined in Section 3.1.1 of this Appendix) for the entire Plan Year. |
(i) | Five percent (5%) of the eligible NHCE’s Eligible Compensation for such Plan Year, |
(ii) | the eligible NHCE ‘s elective contributions for such Plan Year, or |
(iii) | the product of (A) multiplied by (B), where (A) and (B) are: |
(A) | two (2); and |
(B) | the Plan’s representative matching rate (as defined below) multiplied by the eligible NHCE’s elective contributions for the Plan Year. |
(i) | the lowest matching rate (as defined below) for any eligible NHCE among a group of eligible NHCEs that consists of one‑half (1/2) of all eligible NHCEs in the Plan for the Plan Year who made elective contributions for the Plan Year, or |
(ii) | the lowest matching rate (as defined below) for all eligible NHCEs in the Plan who are employed by the Employer on the last day of the Plan Year and who made elective contributions for the Plan Year. |
(i) | the total amount, for the Plan Year, of Employer contributions credited to the eligible NHCE’s Employer Matching Account, to |
(ii) | the total amount, for the Plan Year, of elective contributions credited to the eligible NHCE’s Retirement Savings Account. |
(i) | The Employer matching contributions for the eligible HCE who has the highest contribution percentage shall be reduced by the amount required to cause such eligible HCE’s contribution percentage to equal the next highest contribution percentage of an eligible HCE. |
(ii) | If neither of the tests is satisfied after such reduction, the Employer matching contributions for eligible HCEs who then have the highest contribution percentage (including those reduced under (i) above) shall be reduced by the amount required to cause such eligible HCEs’ contribution percentage to equal the next highest contribution percentage of an eligible HCE. |
(iii) | If neither of the tests is satisfied after such reductions, this method of reduction shall be repeated one or more additional times until one of the tests is satisfied. |
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