Exhibit 10.14
2007 AMENDMENT AND RESTATEMENT OF
AVERY DENNISON CORPORATION
EMPLOYEE SAVINGS PLAN
Avery International Corporation, now known as Avery Dennison Corporation (the Company), a
corporation organized under the laws of the State of Delaware, by resolution of its Board of
Directors adopted on January 27, 1985, approved the adoption of The Employee Stock Accumulation
Plan of Avery International Corporation which was later renamed The Stock Holding and Retirement
Enhancement Plan of Avery Dennison Corporation (the Plan) for the exclusive benefit of its
eligible Employees. By action of the chief executive officer of the Company, the Plan was adopted
February 6, 1985 effective as of December 1, 1984. The Plan has been amended in 1986, on August
25, 1987, March 11, 1988, July 14, 1988, January 19, 1989, November 29, 1989, December 19, 1990,
December 20, 1990, January 14, 1993, October 3, 1994 and December 18, 1996. The Avery Dennison
Corporation Employee Savings Plan (the Savings Plan) merged into the Plan, effective following
the close of business on November 30, 1997 (the Merger) and in conjunction with the amendment
which documented the Merger (the 1997 Amendment and Restatement to the Plan which was adopted on
November 25, 1997), the Plan was renamed as the Avery Dennison Corporation Employee Savings Plan.
The Plan was further amended on March 24, 2000, July 12, 2000, October 18, 2000, November 14,
2001, December 6, 2001, April 24, 2002, July 24, 2002, September 30, 2003, December 11, 2003,
January 4, 2005 and November 28, 2005.
In order to amend the Plan in certain respects, this 2007 Amendment and Restatement to the
Plan has been adopted by the Company on January 25, 2007, effective as of December 1, 2004, unless
otherwise provided in the Plan and Exhibit 1 which is attached hereto and incorporated in the Plan
by this reference. This 2007 Amendment and Restatement of the Plan constitutes a complete
amendment, restatement and continuation of the Plan.
The purposes of the Plan are:
(1) To permit Participants to share in the Companys success.
(2) To stimulate and maintain among Participants a sense of responsibility, cooperative
effort and a sincere interest in the progress and success of the Company.
(3) To increase the efficiency of Participants and to encourage them to remain with the
Company until retirement from active service.
(4) To provide security for Participants by establishing a plan under which each
Participants share of Company contributions, his personal contributions, his deferrals and
the earnings thereon will be invested and accumulated to create a fund to benefit him in the
event of his disability or other termination of employment.
The Plan consists of two plans, a profit-sharing plan and a leveraged ESOP, under a single
document. The document consists of Articles I-XVIII and Supplements containing special provisions
documenting the merger of plan assets and liabilities with, or the transfer of accounts to,
the Savings Plan prior to the Merger and after the Merger. The provisions of a Supplement
apply only to individuals with respect to whom assets and liabilities were transferred to the
Savings Plan or this Plan as described in such Supplement.
The profit-sharing portion of the Plan is intended to comply with the provisions of Sections
401, 401(k), 402(a) and other applicable provisions of the Code, similar provisions of the
California Revenue and Taxation Code, ERISA and Section 7(e)(4) of the Fair Labor Standards Act of
1938, as amended. Its assets consist of all Accounts other than the ESOP Accounts, the Qualified
Accounts (but including Qualified Company Contributions Accounts) and the SHARE Accounts, and
includes any Account described in a Supplement as constituting part of the profit-sharing portion
of the Plan and all allocations thereto.
The leveraged ESOP portion of the Plan is a stock bonus plan which is intended to form an
employee stock ownership plan within the meaning of Section 407(d)(6)(A) of ERISA and Section
4975(d)(3) of the Code. This portion of the Plan is designed to invest in qualifying employer
securities within the meaning of ERISA Section 407(d)(5) and Code Section 4975(e)(8) and is
intended to comply with the provisions of Sections 401, 402(a), 404(a)(3), 404(a)(9) and 404(k) and
other applicable provisions of the Code, similar provisions of the California Revenue and Taxation
Code or other applicable state law and ERISA and Section 7(e)(4) of the Fair Labor Standards Act of
1938, as amended. Its assets consist of the SHARE Accounts, the ESOP Accounts and the Qualified
Accounts (excluding Qualified Company Contributions Accounts), and includes any Account described
in a Supplement as constituting part of the ESOP portion of the Plan and all allocations thereto.
Any Company Stock held by the profit-sharing portion of the Savings Plan and the Plan shall
not be considered to be held by a trust which is part of an employee stock ownership plan.
It is also intended that disability payments received by Participants pursuant to the Plan
shall qualify for exclusion from income under Section 105 of the Internal Revenue Code.
References to events occurring prior to the date of the Merger with respect to a plan or an
account shall be deemed to refer to such plan or account as it existed prior to the Merger but the
effect of such references shall be carried forward to the Plan as merged.
ARTICLE I.
DEFINITIONS
Section 1.1. - General
Whenever any of the following terms is used in the Plan with the first letter or letters
capitalized, it shall have the meaning specified below unless the context clearly indicates to the
contrary.
Section 1.2. - Accounts
Account or Accounts of a Participant, former Participant or Merged Participant shall mean,
as the context indicates, any one or more of his Pretax Savings (PTS) Account, his After-tax
Savings (ATS) Account, his Qualified Account, his Rollover Account, his ESOP
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Account, if any, in the Trust Fund established in accordance with Sections 6.1, 4.4, 6.2(b),
15.12, and 6.2(a), respectively.
Section 1.3. - Active Participant
Active Participant shall mean a Participant who is an Employee and is not in a Bargaining
Unit.
Section 1.4. - Administrator
Administrator shall mean Avery Dennison Corporation, acting through its chief executive
officer or his delegate.
Section 1.5. - After-Tax Savings (ATS) Account
After-Tax Savings Account (ATS Account) of a Participant, consisting of his Basic ATS
Account and his Unmatched ATS Account, shall mean his individual Account in the Trust Fund
established in accordance with Section 4.4, each consisting of two sub-accounts, the Pre-1987
Basic ATS Sub-Account and the Pre-1987 Unmatched ATS Sub-Account (which consist of allocations
to his Basic ATS Account and his Unmatched ATS Account, respectively, made prior to January 1, 1987
as a result of transfers thereto attributable to personal after-tax contributions made prior to
January 1, 1987 together with earnings thereon) and the Post-1986 Basic ATS Sub-Account and
Post-1986 Unmatched ATS Sub-Account (which consist of allocations to his Basic ATS Account and
Unmatched ATS Account, respectively, made after December 31, 1986 which includes transfers thereto
attributable to after-tax personal contributions made after December 31, 1986 together with
earnings thereon).
Section 1.6. - Annual Addition
(a) Annual Addition of a Participant for the Plan Year in question shall mean the sum of
(i) Company contributions and forfeitures allocated to his ESOP Account and Qualified
Account for that Plan Year,
(ii) Company contributions and forfeitures allocated to his PTS Account for that Plan
Year (excluding any excess amounts determined under Code Section 402(g) which are
distributed to him pursuant to Section 18.4(b) not later than the April 15 following the
calendar year in which such excess amounts were deferred),
(iii) Company contributions and forfeitures allocated to his accounts under all other
qualified defined contribution plans, if any, of the Company and any Company Affiliate for
that Plan Year,
(iv) His contributions to his ATS Account under the Plan (excluding any excess amounts
distributed to him pursuant to Section 18.4(b)) and his personal contribution under all
other qualified defined contribution plans, if any, of the Company and any Company Affiliate
for that Plan Year,
(v) Except for purposes of Section 18.4(a)(ii), the sum of
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(A) Company contributions allocated after March 31, 1984 to an
individual medical account as defined in Code Section 415(l)(1), if any,
which is maintained under a qualified pension or annuity plan, and
(B) Company contributions paid or accrued for Plan Years ending after
December 31, 1985, if any, and allocated to the separate account of a Key
Employee (as defined in Section 14.1(b)(iv)) for the purpose of providing
post-retirement medical benefits; and
(vi) Any other amounts described in Treas. Reg. Section 1.415(c)-1(b),
whether or not the allocations or contributions have been recharacterized or distributed
pursuant to Sections 3.5, 6.11, 9.2, 9.3, 9.5 or otherwise.
(b) Provided however, that for any Plan Year for which no more than one third of the Company
contributions which are deductible under Code Section 404(a)(9) are allocated to Highly Compensated
Employees, the Annual Addition of a Participant shall not include
(i) his share of Company contributions for such Plan Year which are deductible under
Code Section 404(a)(9)(B), or
(ii) his share of forfeitures of Company Stock acquired with the proceeds of a loan or
installment obligation described in Code Section 404(a)(9)(A).
(c) If, in a particular Plan Year, the Company contributes an amount to a Participants
Accounts because of an erroneous forfeiture in a prior Plan Year, or because of an erroneous
failure to allocate amounts in a prior Plan Year, the contribution shall not be considered an
Annual Addition with respect to the Participant for that particular Plan Year, but shall be
considered an Annual Addition for the Plan Year to which it relates. If the amount so contributed
in the particular Plan Year takes into account actual investment gains attributable to the period
subsequent to the Plan year to which the contribution relates, the portion of the total
contribution which consists of such gains shall not be considered as an Annual Addition for any
Plan Year.
Section 1.7. - Bargaining Unit
(a) Bargaining Unit shall mean a bargaining unit covered by a collective bargaining
agreement with the Company
(a) if retirement benefits were the subject of good faith bargaining with respect to
such agreement, and
(b) if such agreement does not provide for the coverage under the Plan of Employees in
such unit, or
(c) (i) where such collective bargaining agreement has expired but the terms of
the agreement continue to apply to the bargaining unit by agreement or by operation
of law, or
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(ii) when a party to the agreement has unilaterally implemented terms and
conditions for the bargaining unit after a good faith impasse in negotiations, and
in either paragraph (i) or (ii), the terms do not provide for coverage under the Plan of
Employees in such unit.
Section 1.8. - Basic ATS Account
Basic ATS Account of a Participant shall mean the portion of his ATS Account so designated,
as described in Section 4.4.
Section 1.9. - Basic PTS Account
Basic PTS Account of a Participant shall mean his individual Account established in
connection with Section 6.1.
Section 1.10. - Beneficiary
Beneficiary shall mean a person or trust properly designated by a Participant, former
Participant or Merged Participant to receive benefits, or such Participants Spouse or heirs at
law, as provided in Article XII or any Supplement.
Section 1.11. - Board
Board shall mean the board of directors of Avery Dennison Corporation.
Section 1.12. - Break in Service Year
Break in Service Year of an Employee or former Employee shall mean the three hundred and
sixty-five day period
(a) which begins on the later of
(i) the date of his last Separation from the Service, or
(ii) if the Employee furnishes to the Administrator such timely information as the
Administrator may reasonably require to establish that the Employees absence from work is
for any of the following reasons or purposes, the second anniversary of the first day of his
absence from work
a by reason of pregnancy of the Employee,
b by reason of the birth of a child of the Employee,
c by reason of the placement of a child with the Employee in connection
with the adoption of such child by the Employee, or
d for purposes of caring for such child for a period beginning
immediately following such birth or placement, and
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(b) during no part of which he was an Employee or employed by a Company Affiliate.
Section 1.13. - Cash Account
Cash Account of a Participant shall mean that portion of his Stock Accounts which has not
yet been used to purchase Company Stock.
Section 1.14. - Catch-Up Eligible Participant
Catch-Up Eligible Participant for a Plan Year shall mean an Eligible Employee who
(a) is eligible to make contributions to his PTS Account during such Plan Year
(without regard to Code Section 414(v)); and
(b) will be age 50 or older before the end of such Plan Year.
Section 1.15. - Code
Code shall mean the Internal Revenue Code of 1986, as amended.
Section 1.16. - Company; Company Affiliate
(a) Company shall mean Avery Dennison Corporation, Dennison Manufacturing Company,
Avery Dennison Office Products Company, any other Company Affiliate which subsequently
adopts the Plan as a whole or as to any one or more divisions, in accordance with Section
16.4(c), and any successor company which continues the Plan under Section 16.4(a).
(b) Company Affiliate shall mean any employer which, at the time of reference, was
with Avery Dennison Corporation, a member of a controlled group of corporations or trades
or businesses under common control, or a member of an affiliated service group, as
determined under regulations issued by the Secretary of the Treasury or his delegate under
Code Sections 414(b), (c), (m) and 415(h) and any other entity required to be aggregated
with Avery Dennison Corporation pursuant to regulations issued under Code Section 414(o).
Section 1.17. - Company Stock
Company Stock shall mean common stock of Avery Dennison Corporation that, at the time of
reference is either:
(a) publicly traded as that term is defined under Treasury Regulation Section
54.4975-7(b)(1)(iv) or any successor regulation thereto, and not subject to a trading
limitation as that term is defined under Treasury Regulation Section 54.4975-7(b)(10) or
any successor regulation thereto or
(b) not publicly traded (as defined above) but having a combination of voting power and
dividend rights equal to or in excess of
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(i) that class of common stock of the Company (or of any other such
corporation) having the greatest voting power and
(ii) that class of common stock of the Company (or of any other such
corporation) having the greatest dividend rights.
Section 1.18. - Company Stock Fund
Company Stock shall mean common stock of Avery Dennison Corporation that, at the time of
reference is either:
(a) publicly traded as that term is defined under Treasury Regulation Section
54.4975-7(b)(1)(iv) or any successor regulation thereto, and not subject to a trading
limitation as that term is defined under Treasury Regulation Section 54.4975-7(b)(10) or
any successor regulation thereto or
(b) not publicly traded (as defined above) but having a combination of voting power and
dividend rights equal to or in excess of
(i) that class of common stock of the Company (or of any other such
corporation) having the greatest voting power and
(ii) that class of common stock of the Company (or of any other such
corporation) having the greatest dividend rights.
Section 1.19. - Compensation
(a) Compensation of a Participant for any Plan Year shall mean his Statutory
Compensation (including differential wage payments described in Code Sections 414(u)(12)(A)
and (D)) from a Company for such Plan Year and excluding all reimbursements or other
expense allowances, fringe benefits (cash and noncash), moving expenses, deferred
compensation, any awards pursuant to the Key Executive Long-Term Incentive Plan, short term
disability payments, salary continuation under workers compensation and welfare benefits,
severance benefits and other payments described in Section 1.64(e), payments described in
Sections 1.64(b) and (c) which are paid to the Participant more than thirty days after the
date of his severance from employment and amounts described in Section 1.64(d) (except to
the extent they are differential wage payments described above) (even if includable in
gross income), but in no event greater than the limit under Code Section 401(a)(17) (which,
effective as of December 1, 2009, is $245,000) (adjusted for increases in the cost of
living as described in Code Section 401(a)(17)(B)) and, if the Plan Year is less than
twelve months, such limit shall be reduced to an amount equal to such limit multiplied by a
fraction, the numerator representing the number of months in the Plan Year and the
denominator of which is twelve).
(b) The Administrator may elect for any Plan Year and solely for the purposes of
Sections 1.20 and 1.22 to amend the Plan to
(i) apply an alternate definition of Compensation; provided, however, that such
definition shall satisfy the requirements of Code Section 414(s) and the Regulations
thereunder; and/or
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(ii) exclude from Compensation of Participants that part thereof deferred under Article
III and under cafeteria plans.
Section 1.20. - Contribution Percentage
(a) Contribution Percentage for a Plan Year shall mean, with respect to eligible
Participants who are Highly Compensated Employees as a group and to eligible Participants
who are not Highly Compensated Employees as a group, the average of the decimal numbers
obtained, as to each such Participant, by dividing
(i) his allocations described in subsection (b), by
(ii) his Compensation for that portion of the Plan Year during which he was eligible to
contribute to his ATS Account or to receive allocations to his ESOP Account.
(b) The allocations described in this subsection are
(i) allocations to his ATS Account, excluding any excess amounts distributed to him
pursuant to Section 18.4(b),
(ii) allocations to his ESOP Account under Section 6.3(b),
(iii) allocations to his PTS Account, to the extent that the Administrator elects to
take such allocations into account under Section 6.11(b)(ii),
(iv) allocations to his Qualified Matching Account and Qualified Non-Matching Account
to the extent the Administrator elects to take such allocations into account under Section
6.11(b), and
(v) allocations deemed to be personal contributions under Section 3.5(b)(v).
(c) (i) For purposes of this Section, all plans required to be taken into account
under Code Section 401(m)(2)(B) shall be treated as a single plan.
(ii) This Section shall be applied separately with respect to each plan, within the
meaning of Treas. Reg. Section 1.401(m)-1(b)(4).
(d) The Administrator may elect to expand the Compensation of a Participant taken into
account for purposes of subsection (a)(ii) to such amounts received by him for that entire
Plan Year; provided, however, that such determination shall be applied uniformly to all
Participants for the year in question.
Section 1.21. - Current Obligations
Current Obligations shall mean obligations of the Trust arising from extensions of credit to
the Trust, in connection with the purchase by the Trust of Leveraged Company Stock, and either
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(a) payable in cash within one year from the date of reference pursuant to the terms of
the applicable credit agreement, or
(b) specified by the Administrator as subject to current payment with Trust assets
available therefor pursuant to the terms of this Plan.
Section 1.21A DB Eligible Participant
A DB Eligible Participant shall mean a Participant who is eligible to accrue benefits under
the Associate Retirement Plan for Employees of Avery Dennison Corporation, a component plan under
the Dennison Retirement Plan (or any successor thereto).
Section 1.22. - Deferral Percentage
(a) Deferral Percentage for a Plan Year shall mean, with respect to eligible
Participants who are Highly Compensated Employees as a group and to eligible Participants
who are not Highly Compensated Employees as a group, the average of the decimal numbers
obtained, as to each such Participant, by dividing
(i) the amount, if any, credited to his PTS Account for that Plan Year in question
under this Plan and any other plans which are aggregated with this Plan under Code Section
401(k)(3)(A) (including any excess amounts described in Code Section 402(g) if he is a
Highly Compensated Employee but excluding any excess amounts distributed to him pursuant to
Section 18.4(b)) (and, to the extent elected by the Administrator under Section 3.5(b)
amounts credited to his Qualified Account for that Plan Year), by
(ii) his Compensation for that portion of the Plan Year during which he was eligible to
defer Compensation to his PTS Account.
(b) The Administrator may elect to expand the Compensation of a Participant taken into
account for purposes of subsection (a)(ii) to such amounts received by him for that entire
Plan Year; provided, however, that such determination shall be applied uniformly to all
Participants for the year in question.
(c) This Section shall be applied separately with respect to each plan, within the
meaning of Treas. Reg. Section 1.401(k)-1(b)(4).
Section 1.23. - Deferred Compensation
Deferred Compensation of a Participant shall mean an amount contributed by the Company to
the Plan for him under Section 5.1(a).
Section 1.24. - Direct Rollover
Direct Rollover shall mean a payment by the Plan to an Eligible Retirement Plan designated
by a Distributee.
Section 1.25. - Distributee
Distributee shall mean
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(a) a Participant, former Participant, Merged Participant,
(b) the Surviving Spouse or other designated Beneficiary of such a Participant, or
(c) a Spouse or former Spouse of such a Participant who is an alternate payee under a
qualified domestic relations order, as defined in Code Section 414(p).
Section 1.26. - Disability Retirement
Disability Retirement of a Participant or Merged Participant shall mean his Separation from
the Service as a result of mental or physical disease or condition which entitles the Participant
(or would entitle the Participant, after expiration of applicable waiting periods,) to long term
disability benefits under the long term disability plan offered to its Employees by the Company or,
if such Participant does not participate in such plan, would entitle the Participant to such
benefits if he did participate.
Section 1.27. - Disability Retirement Date
Disability Retirement Date of a Participant or Merged Participant shall mean the date (prior
to his Normal Retirement Date) fixed by the Administrator for his Disability Retirement.
Section 1.28. - Eligible Retirement Plan
(a) Eligible Retirement Plan shall mean
(i) an individual retirement account (described in Code Section 408(a)),
(ii) an individual retirement annuity (described in Code Section 408(b) other than an
endowment contract),
(iii) an annuity plan (described in Code Section 403(a)),
(iv) a qualified trust (described in Code Section 401(a)),
(v) an annuity contract described in Code Section 403(b), or
(vi) an eligible deferred compensation plan described in Code Section 457(b) which is
maintained by an eligible employer described in Code Section 457(e)(1)(A) (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 the Plan,
that will accept a Distributees Eligible Rollover Distribution. This definition shall apply to a
Distributee who is a Participant, a Surviving Spouse of a Participant or to a spouse or former
spouse who is the alternate payee under a qualified domestic relations order, as defined in Code
Section 414(p).
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(b) In addition, effective January 1, 2008, a Roth IRA (described in Code Section 408A) is an
Eligible Retirement Plan that may accept a Distributees Eligible Rollover Distribution subject to
the applicable rules for such rollovers.
(c) This definition of an Eligible Retirement Plan shall also apply in the case of a
distribution to a Surviving Spouse, or to a Spouse of former Spouse who is an alternate payee under
a qualified domestic relations order, as defined in Code Section 414(p). However, in the case of
an Eligible Rollover Distribution to a non-Spouse Beneficiary, Eligible Retirement Retirement shall
mean only an individual retirement account described in Code Section 408(a) or an individual
retirement annuity described in Code Section 408(b). A Direct Rollover to a non-Spouse Beneficiary
must be accomplished through a direct trustee-to-trustee transfer to an Eligible Retirement Plan
described in the preceding sentence.
Section 1.29. - Eligible Rollover Distribution
(a) Except as provided in subsections (b) and (c), Eligible Rollover Distribution shall mean
any distribution of all or any portion of a Participants, former Participants or Merged
Participant s Accounts to a Distributee.
(b) Eligible Rollover Distribution shall not mean any distribution
(i) that is one of a series of substantially equal periodic payments (not less
frequently than annually) made for the life (or life expectancy) of the Distributee or the
joint lives (or joint life expectancies) of the Distributee and the Distributee s
Beneficiary,
(ii) that is paid for a specified period of ten years or more,
(iii) that is part of a series of distributions during a calendar year to the extent
that such distributions are expected to total less than $200 or a total lump sum
distribution which is equal to less than $200, as described in Treas. Reg. Section
1.401(a)(31) 1 A-11,
(iv) that is a Hardship withdrawal pursuant to Section 9.2 and Section 9.3,
(v) to the extent such distribution is required under Code Section 401(a)(9) except as
provided in subsection (d) and Section 11.4(c),
(vi) that is paid to a Beneficiary under Article XII other than the Surviving Spouse or
the spouse or former spouse of the Participant who is an alternate payee under a qualified
domestic relations order as defined in Code Section 414(p),
(vii) to the extent such distribution is not includable in gross income (determined
without regard to the exclusion for net unrealized appreciation with respect to employer
securities), except as described in subsection (c).
(c) An Eligible Rollover Distribution shall include after-tax contributions only to the extent
such distribution is transferred to an Eligible Retirement Plan described in Section 1.28(a)(i),
(ii), (iv) or (v). Any such transfers of after-tax contributions to an Eligible Retirement Plan
described in Section 1.28(a)(iv) or (v) must be accomplished through a direct trustee-to-trustee
transfer which provides for separate accounting for amounts so transferred (including separately
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accounting for the portion of such distribution which is includable in gross income and the
portion of such distribution which is not so includable).
(d) A Distributee who receives an amount that would have been a 2009 RMD (as defined in
Section 11.4(c)) may direct the Administrator or its delegate to transfer such amount to an
Eligible Retirement Plan in a Direct Rollover.
Section 1.30. - Employee; Leased Employee
(a) Employee shall mean any person who renders services to the Company in the status of an
employee as the term is defined in Code Section 3121(d), including any United States citizen
employed by a foreign subsidiary of the Company to which there applies an agreement under Code
Section 3121(1) and if no contributions to a funded plan of deferred compensation (whether or not a
plan described in Code Sections 401(a), 403(a), or 405(a)) are provided by any other person with
respect to the compensation paid to such citizen by the foreign subsidiary. Employee shall also
include any Included Affiliate Employee and any citizen of a foreign country who is employed by the
Company or a Company Affiliate in the United States and is thereby prevented from participating in
a thrift or savings plan maintained by the Company or a Company Affiliate for citizens of a foreign
country. Except as provided in subsection 1.35(b) and Section 1.36, Employee shall not include
(i) Leased Employees treated as Employees of the Company pursuant to Code Sections
414(n) and 414(o),
(ii) employees of a Company Affiliate that is not a Company,
(iii) any person who participates in The Avery Dennison Pension Plan for Key
International Expatriate Staff (TCN),
(iv) any person whose services with the Company are performed pursuant to a contract or
an arrangement that purports to treat the individual as an independent contractor even if
such individual is later determined (by judicial action or otherwise) to have been a common
law employee of the Company rather than an independent contractor, or
(v) any employee who is listed on Exhibit 4 of the Plan which is attached hereto and
incorporated in the Plan by this reference. The Vice President, Compensation and Benefits
of Avery Dennison Corporation is authorized to amend Exhibit 4 as described in this
paragraph and Section 1.37.
(b) For purposes of subsection (a), a Leased Employee means any individual who is not an
Employee of the Company who provides services to the Company if
(i) such services are provided pursuant to an agreement between the Company and any
other person,
(ii) such individual has performed such services for the Company or a Company Affiliate
on a substantially full-time basis for at least one year, and
(iii) such services are performed under primary direction of control by the Company.
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Section 1.31. - ERISA
ERISA shall mean the Employee Retirement Income Security Act of 1974, as amended.
Section 1.32. - ESOP Account
ESOP Account of a Participant shall mean his individual account established in accordance
with Section 6.2(a), together with such other accounts received by this Plan in a trust-to-trust
transfer, as the Administrator shall designate.
Section 1.33. - [Reserved.]
Section 1.34. - Hardship
(a) Hardship of a Participant as determined by the Administrator in its discretion
on the basis of all relevant facts and circumstances and in accordance with the following
nondiscriminatory and objective standards, uniformly interpreted and consistently applied,
and without regard to the existence of other resources which are reasonably available to
the Participant in question, shall mean any one or more of the following:
(i) Unreimbursed expenses for medical care described in Code Section 213(d) previously
incurred by him, his spouse, or his dependent (as described in Code Section 152 and, for
Plan Years beginning on or after January 1, 2005, without regard to Code Sections 152(b)(1),
(b)(2) and (d)(1)(B)) or necessary for him, his spouse or his dependent to obtain medical
care.
(ii) Costs directly related to the purchase (excluding mortgage payments) of a
principal residence for him.
(iii) Payment of tuition and related educational fees for the next twelve months of
post-secondary education for him, his spouse, children, or his dependents (as so described).
(iv) Payments necessary to prevent his eviction from his principal residence, or
foreclosure on the mortgage of his principal residence.
(v) Payments for burial or funeral expenses for his parent, spouse, children or
dependents (as so described).
(vi) Expenses for the repair of damage to his principal residence that would qualify
for the casualty deduction under Code Section 165 (determined without regard to whether the
loss exceeds 10% of adjusted gross income).
(vii) Any other event identified by the Commissioner of Internal Revenue in revenue
rulings, notices and/or other documents of general applicability for inclusion in the
foregoing list.
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(viii) Costs and expenses for any of the following which constitute an immediate and
heavy financial need of the Participant, if as to him, it is a rare and unusual event.
a Withholding and/or payment of taxes attributable to a Hardship
withdrawal.
b Any of the following events if the event described in the last
sentence of Section 15.14(b)(viii) has occurred:
1 The purchase or repair of a vehicle for his transportation to
and from work at the Company when no other method of such transportation
(including rental or lease of a vehicle) is reasonably available.
2 The payment of his taxes when necessary to avoid penalties or
seizure of his property.
3 The satisfaction of a substantial judgment, award, fine,
levy, garnishment or other liability of his.
4 An increase in the size of, or of living space in, his
principal residence, when reasonably necessary for the housing of his
immediate family and/or dependents (as so described).
5 Repair or reconstruction of his principal residence due to
fire, flood, wind, earthquake, vandalism or other casualty.
6 Any other event of equal seriousness and financial impact.
(b) A financial need shall not constitute a Hardship unless satisfaction thereof
requires at least $1,000.00 (or the entire principal amount of the Participants PTS
Account, if less).
(c) A financial need shall not fail to qualify as immediate and heavy merely because
such need was reasonably foreseeable by the Participant or voluntarily incurred by him.
Section 1.35. - Highly Compensated Employee
(a) For any Plan Year, a Highly Compensated Employee shall mean any Employee who
(i) in the previous Plan Year had Statutory Compensation in excess of $80,000 (adjusted
as described in Code Section 414(q)(1)), and was in the group consisting of the top twenty
percent of Employees when ranked by Statutory Compensation for such previous Plan Year
(determined after excluding the Employees described in Code Sections 414(q)(5) and
414(q)(8)), or
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(ii) in the previous Plan Year or the current Plan Year was a five percent owner of the
Company or a Company Affiliate (within the meaning of Code Section 414(q)(2)),
and any former Employee, who during the Plan Year in which he separated from the Service or
during any Plan Year ending on or after his fifty-fifth birthday, was a highly compensated
employee, as defined in Code Section 414(q).
(b) For purposes of this Section, Employee shall include leased Employees treated as
Employees of the Company or a Company Affiliate pursuant to Code Section 414(n) or 414(o)
and shall include Employees of a Company Affiliate, but shall not include an Employee who
is on a leave of absence throughout the Plan Year, or an Employee who will not attain age
55 before the last day of such Plan Year and who receives Statutory Compensation for the
Plan Year in an amount less than 50% of such Employees average annual Statutory
Compensation for the three consecutive calendar years preceding the Plan Year during which
such Employee received the greatest amount of Statutory Compensation (or the total period
of the Employees employment by the Company or any Company Affiliate, if less).
Section 1.36. - Hour of Service
(a) Hour of Service of an Employee (including a leased Employee pursuant to Code
Sections 414(n) and (o)) shall mean the following:
(i) Each hour for which he is paid or entitled to payment by the Company or a Company
Affiliate for the performance of services.
(ii) Each hour in or attributable to a period of time during which he performs no
duties (irrespective of whether he has had a Separation from the Service) due to a vacation,
holiday, illness, incapacity (including disability), layoff, jury duty, military duty or a
leave of absence for which he is so paid or so entitled to payment by the Company or a
Company Affiliate, whether direct or indirect; provided, however, that no such hours shall
be credited to an Employee if attributable to payments made or due under a plan maintained
solely for the purpose of complying with applicable workers compensation, unemployment
compensation or disability insurance laws or to a payment which solely reimburses the
Employee for medical or medically related expenses incurred by him.
(iii) Each hour for which he is entitled to back pay, irrespective of mitigation of
damages, whether awarded or agreed to by the Company or a Company Affiliate.
(iv) Each hour while on an unpaid leave pursuant to the Family and Medical Leave Act of
1993 for which he would have been paid or entitled to payment by the Company or a Company
Affiliate had he been performing services.
(b) Hours of Service under subsections (a)(ii) and (a)(iii) shall be calculated in
accordance with 29 C.F.R. § 2530.200b-2(b). Each Hour of Service shall be attributed to
the Plan Year in which it occurs except to the extent that the Company, in
15
accordance with 29 C.F.R. § 2530.200b-2(c), credits such Hour to another computation
period under a reasonable method consistently applied.
(c) The Hours of Service of an Employee occurring prior to December 1, 1976 shall be
determined by the Administrator from reasonably accessible records by means of appropriate
calculations and approximations or, if such records are insufficient to make an appropriate
determination, by reasonable estimation.
(d) Any reference to Company with respect to periods before June 15, 2007 shall
include Paxar Corporation and with respect to periods before April 1, 2008 shall include DM
Label, Inc. for purposes of Section 1.77.
(e) For each employee of Aramark Facility Services on December 31, 2008 who becomes an
Employee on January 1, 2009, any reference to Company for periods before January 1, 2009
shall include Aramark Facility Services for purposes of Section 1.77.
Section 1.37. - Included Affiliate Employee
Included Affiliate Employee shall mean any person who is employed by a Company Affiliate and
would not be an Employee but for the fact that such person or group is listed on Exhibit 4 of the
Plan.
Section 1.38. - Leveling Method
The Leveling Method refers to the following two step method of determining the total dollar
amount of excess contributions (within the meaning of Reg. Sections 1.401(k)-2(b)(2)(iii)) or
excess aggregate contributions (within the meaning of Reg. Section 1.401(m)-2(b)(2)(iii)) and
apportioning such excess contributions (or excess aggregate contributions) among the Highly
Compensated Employees in question so that the appropriate action may be taken by the Administrator
as set forth in Section 3.5(b) or Section 6.11(b):
(a) The actual deferral ratio (or actual contribution ratio) of the Highly Compensated
Employee with the highest actual deferral ratio (or actual contribution ratio) shall be
reduced to equal that of the Highly Compensated Employee with the next highest actual
deferral ratio (or actual contribution ratio) and this process shall be repeated until
Section 3.5(a) (or Section 6.11(a)) is satisfied.
(b) The amount determined under subsection (a) shall be apportioned among the Highly
Compensated Employees such that the allocations of the Highly Compensated Employee with the
highest dollar amount of allocations described in Section 1.22(a)(i) (or Section 1.20(b) as
applicable) for the Plan Year in question shall be reduced by the amount required to cause
the Highly Compensated Employees allocations to equal the dollar amount of the Highly
Compensated Employee with the next highest dollar amount of such allocations and this
process shall be repeated to the extent required so that the total reductions equal the
amount determined under subsection (a). If a lesser reduction, when added to the dollar
amount already reduced, would equal the total dollar amount determined under subsection
(a), the lesser reduction shall apply. The Administrator shall then take the appropriate
action (i.e., recharacterization, distribution or forfeiture) with respect to such
16
reductions (together with the required amount of income thereon) as described in
Section 3.5(b) (or Section 6.11(b) as applicable).
Section 1.39. - Leveraged Company Stock
Leveraged Company Stock shall mean any Company Stock that is acquired by the Trustee with
the proceeds of a loan made or guaranteed by the Company or any other party constituting a
disqualified person within the meaning of Code Section 4975(e)(2), or any successor statute, as
amended from time to time.
Section 1.40. - Merged Participant
Merged Participant shall mean any person who is not a Participant but was a participant in
(a) a plan which merged with, or transferred accounts to the Savings Plan or the Plan
as described in the applicable Supplement and/or
(b) the Savings Plan as described in Supplement H,
for whom the Company maintains one or more Accounts as described in the applicable Supplements.
Section 1.41. - Merger
Merger shall mean the merger of the Savings Plan into the Plan as described in the preamble
of this Amendment to the Plan.
Section 1.42. - Military Leave
Any Employee who leaves the Company or a Company Affiliate directly to perform service in the
Armed Forces of the United States or in the United States Public Health Service under conditions
entitling him to reemployment rights, as provided in the laws of the United States, shall, solely
for purposes of the Plan and irrespective of whether he is compensated by the Company or a Company
Affiliate during such period of service, be on Military Leave. An Employees Military Leave shall
expire if such Employee voluntarily resigns from the Company or such Company Affiliate during such
period of service or if he fails to make application for reemployment within the period specified
by such laws for the preservation of his reemployment rights. For purposes of computing an
Employees Service, no more than 365 days of Service shall be credited for any Military Leave
except as required by Treas. Reg. § 1.410(a)-7(b)(6)(iii).
Section 1.43. - Normal Retirement
Normal Retirement of a Participant or Merged Participant shall mean his Separation from the
Service upon his Normal Retirement Date, or after such date (except by death) as permitted under
Article XI.
Section 1.44. - Normal Retirement Date
Normal Retirement Date of a Participant or Merged Participant shall mean the first day of
the month coinciding with or next following his sixty-fifth birthday.
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Section 1.45. - Option Stock
Option Stock shall mean Company Stock that is distributed to a Qualified Holder if, at the
time of distribution, such Company Stock is not publicly traded.
Section 1.46. - Participant
Participant shall mean any person included in the Plan as provided in Article II.
Section 1.47. - Pay
Pay of a Participant for a Plan Year shall mean his Compensation for a Payday but without
regard to any limitation imposed by Code Section 401(a)(17).
Section 1.48. - Payday
Payday of a Participant shall mean the regular and recurring established day for payment of
Compensation to Employees in his classification or position.
Section 1.49. - Plan
Plan shall mean the Avery Dennison Corporation Employee Savings Plan, previously known as
The Stock Holding and Retirement Enhancement Plan of Avery Dennison Corporation including, as
context requires, the Savings Plan which merged into the Plan, effective following the close of
business on November 30, 1997 as described in Supplement H as well as the plans which merged with
or transferred assets into the Savings Plan prior to the Merger as described in Supplements A-G and
those plans which merged with and into the Plan after the Merger as described in Supplements J-O.
Section 1.50. - Plan Representative
Plan Representative shall mean any person or persons designated by the Administrator to
function in accordance with the Rules of the Plan.
Section 1.51. - Plan Year
Plan Year shall mean the calendar year, resulting in a short Plan Year from December 1
through December 31, 2008.
Section 1.52. - Pretax Savings (PTS) Account
Pretax Savings Account (PTS Account) of a Participant, consisting of his Basic PTS Account
and his Unmatched PTS Account together with such other accounts received by this Plan in a
trust-to-trust transfer, as the Administrator shall designate, shall mean his individual Account
established in accordance with Section 6.1.
Section 1.53. - Qualified Account
Qualified Account of a Participant shall mean his individual account in the Trust Fund, if
any, established in accordance with Section 6.2(b), pursuant to Sections 3.5 and 6.11,
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together with such other accounts received by this Plan in a trust-to-trust transfer, as the
Administrator shall designate.
Section 1.54. - Qualified Holder
Qualified Holder shall mean the Participant or Beneficiary receiving a distribution of
Company Stock from Stock Accounts, any other party to whom such stock is transferred by gift or by
reason of death and any trustee of an individual retirement account (as defined under Code Section
408) to which all or any portion of such distributed Company Stock is transferred pursuant to a
tax-free rollover transaction satisfying the requirements of Code Section 402.
Section 1.55. - Qualified Matching Account
Qualified Matching Account of a Participant shall mean the portion of his Qualified Account
established in accordance with Section 6.2(b).
Section 1.56. - Qualified Non-Matching Account
Qualified Non-Matching Account of a Participant shall mean the portion of his Qualified
Account established in accordance with Section 6.2(b).
Section 1.57. - Rollover Account
Rollover Account of an Employee shall mean his individual account in the Trust Fund
established in accordance with Section 15.12, together with such other accounts received by this
Plan in a trust-to-trust transfer, as the Administrator shall designate.
Section 1.58. - Rules of the Plan
Rules of the Plan shall mean the rules adopted by the Administrator pursuant to Section
15.1(a)(iii) for the administration, interpretation or application of the Plan.
Section 1.59. - Savings Plan
Savings Plan shall mean the Avery Dennison Corporation Employee Savings Plan as it existed
prior to the Merger.
Section 1.60.- Separation from the Service
(a) Separation from the Service of an Employee shall mean his resignation from or
discharge by the Company or a Company Affiliate, or his death, Normal or Disability
Retirement but not his transfer among the Company and Company Affiliates.
(b) A leave of absence or sick leave authorized by the Company or a Company Affiliate
in accordance with established policies, a vacation period, a temporary layoff for lack of
work or a Military Leave shall not constitute a Separation from the Service; provided,
however, that
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(i) continuation upon a temporary layoff for lack of work, sick leave, vacation or
leave of absence for a period in excess of twelve months shall be considered a discharge
effective as of the expiration of the twelfth month of such period, and
(ii) failure to return to work upon expiration of any leave of absence, sick leave, or
vacation or within three days after recall from a temporary layoff for lack of work, or upon
expiration of a Military Leave shall be considered a resignation effective as of the
commencement of any such leave of absence, sick leave, vacation, temporary layoff or
Military Leave except that if the Employee fails to return to work because he has died or
attained age sixty-five, he shall be deemed to have resigned on the date of his death or
attainment of age sixty-five, as applicable.
Section 1.61. - Service
Service of an Employee, expressed in days, shall mean the period of elapsed time which, or
the sum of such periods each of which, is measured from
(a) his first Hour of Service, or his first Hour of Service following a Break in
Service Year, as the case may be, to
(b) (i) the first day of his first subsequent Break in Service Year, or
(ii) the first day of the twelve month period immediately preceding the first
day of his first subsequent Break in Service Year if the Break in Service Year
occurs for the reasons described in Section 1.12(a)(ii).
Section 1.62. - Spousal Consent
Spousal Consent to an election, designation or other action of a Participant, former
Participant or Merged Participant, shall mean the written consent thereto of the spouse of such
Participant, witnessed by a Plan Representative or a notary public, which acknowledges the effect
of such election on the rights of the spouse, and, in the case of consent to a Beneficiary
designation, with such designation not being changeable without further Spousal Consent unless the
prior Spousal Consent expressly permits such changes without the necessity of further consent.
Spousal Consent shall be deemed to have been obtained if it is established to the satisfaction of
the Plan Representative that it cannot actually be obtained because there is no spouse, or because
the spouse could not be located, or because of such other circumstances as the Secretary of the
Treasury by regulation may prescribe. Any Spousal Consent shall be effective only with respect to
the spouse in question.
Section 1.63. - Spouse; Surviving Spouse
Spouse or Surviving Spouse of a Participant, former Participant or Merged Participant
shall mean the spouse to whom he was married throughout the 365-day period ending on the date of
his death; provided, however, that to the extent required by a qualified domestic relations order
issued in accordance with Code Section 414(p), a former Spouse shall be treated as a Surviving
Spouse.
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Section 1.64. - Statutory Compensation
(a) Statutory Compensation of a Participant for any Plan Year shall mean his total
taxable remuneration received from the Company and all Company Affiliates in that Plan Year
for services rendered as an Employee,
(i) and including any elective deferral as defined in Code Section 402(g)(3) and any
amounts not includable in gross income by reason of Code Section 125 (cafeteria plan)
(whether or not such amount is deemed Section 125 compensation within the meaning of
Revenue Ruling 2002-27), Code Section 132(f)(4) (qualified transportation fringe benefit) or
Code Section 457 (deferred compensation plan of state and local governments and tax-exempt
organizations),
(ii) and excluding
a Company and Company Affiliate contributions to a deferred
compensation plan (to the extent includable in the Participants gross income solely
by reason of Code Section 415) or to a simplified employee pension plan (to the
extent deductible by the Participant) and any distribution from a deferred
compensation plan (other than an unfunded, non-qualified plan),
b amounts realized from the exercise of a non-qualified stock option or
taxable by reason of restricted property becoming freely tradable or free of a
substantial risk of forfeiture, as described in Code Section 83,
c amounts realized from the sale, exchange or other disposition of
stock acquired under a qualified stock option and
d other amounts which receive special tax benefits such as premiums for
group-term life insurance (but only to the extent that the premiums are not
includible in the gross income of the Employee) except as otherwise provided in
subsection (a) and Company or Company Affiliate contributions toward the purchase of
an annuity contract described in Code Section 403(b) (whether or not excludable from
the Participants gross income),
but in no event greater than the limit described in Code Section 401(a)(17) (which, effective as of
December 1, 2007, is $225,000) (adjusted for increases in the cost of living described in Code
Section 401(a)(17)(B)).
(b) Except as described in subsection (c), Statutory Compensation for the Plan Year
must be actually paid or made available to the Participant (or, if earlier, includible in
the gross income of the Participant) within the Plan Year and it must be paid or treated as
paid prior to his severance from employment within the meaning of Treas. Reg. Section
1.415(a)-1(f)(5). Notwithstanding the foregoing, Statutory Compensation for a Plan Year
shall include amounts earned but not paid during the Plan Year solely because of the timing
of payroll periods and pay dates if the following requirements are satisfied:
(i) these amounts are paid during the first few weeks of the next Plan Year;
21
(ii) the amounts are included on a uniform and consistent basis with respect to all
similarly situated Participants, and
(iii) no such Statutory Compensation is included in more than one Plan Year.
(c) (i) Notwithstanding subsection (b), any amount described in paragraphs (ii) or
(iii) does not fail to be Statutory Compensation for a Participant merely because it is
paid after his severance from employment provided that it is paid by the later of 2 1/2
months after his severance from employment or the end of the Plan Year that includes the
date of his severance from employment.
(ii) An amount is described in this paragraph if it is
a regular compensation for services during the Participants regular
working hours or compensation for services outside the Participants regular working
hours (such as overtime or shift differential, commissions, bonuses or other similar
payments), and
b the payment would have been paid to the Participant prior to his
severance from employment if he had continued employment with the Company or Company
Affiliate.
(iii) An amount is described in this paragraph if it is
a payment for unused accrued bona fide sick, vacation or other leave,
but only if the Participant would have been able to use the leave if his employment
had continued, or
b received by the Participant pursuant to a nonqualified unfunded
deferred compensation plan, but only if the payment would have been paid to the
Participant at the same time if the Participant had continued in employment with the
Company or Company Affiliate and only to the extent it is includible in the
Participants gross income;
provided, however, that such amounts would have been included in the definition of Statutory
Compensation if they were paid prior to the Participants severance from employment with the
Company or Company Affiliate.
(d) Statutory Compensation shall include payments to:
(i) an individual who does not currently perform services for the Company or a Company
Affiliate by reason of qualified military service (as defined in Code Section 414(u)(1)) to
the extent those payments do not exceed the amounts the individual would have received if he
had continued to perform services for the Company or Company Affiliate rather than entering
into qualified military service; or
(ii) a Participant who is permanently and totally disabled within the meaning of Code
Section 22(e)(3) if the conditions described in Treas. Reg. Section 415(c)-2(g)(4)(ii) are
satisfied.
22
(e) Statutory Compensation shall not include the following post-severance payments:
(i) severance payments or parachute payments within the meaning of Code Section
280G(b)(2) if they are paid after severance from employment; and
(ii) post-severance payments from a nonqualified unfunded deferred compensation plan
unless the payments would have been paid at that time without regard to the Participants
severance from employment.
Section 1.65. - Stock Account
A Stock Account of a Participant shall mean his ESOP Account and, as required by context,
the portion of his Accounts which is invested in the Company Stock Fund, together with such other
accounts received by this Plan in a trust-to-trust transfer, as the Administrator shall designate.
For purposes of Section 6.10 (including Sections A6.10, E6.10, F6.10 and H6.10), Stock Account
shall mean only that portion of a Participants Stock Account held in Company Stock.
Section 1.66. - Subfund
Subfund shall mean one of the investment funds of the Trust Fund which is authorized by the
Administrator at the time of reference.
Section 1.67. - Supplement
Supplement or Supplements shall mean, as the context indicates, any one or more of the
Supplements to the Plan which are attached hereto and are incorporated in the Plan by this
reference which modify and supplement the Plan in order to document a merger with or transfer of
accounts to the Savings Plan or the Plan and the treatment thereof.
Section 1.68. - Suspense Account
Suspense Account shall mean the special Trust Fund Account established and maintained
pursuant to the provisions of Sections 6.7 and 6.8 for the purpose of holding Leveraged Company
Stock (until such Company Stock is released and allocated in accordance with the applicable
provisions of this Plan) and cash, and shall include the Suspense Account that existed under the
Savings Plan.
Section 1.69. - Trust
Trust shall mean the trust established pursuant to the Trust Agreement.
Section 1.70. - Trust Agreement
Trust Agreement shall mean that certain Avery Dennison Master Defined Contribution Plan
Trust Agreement providing for the investment and administration of the Trust Fund. By this
reference, the Trust Agreement is incorporated herein.
23
Section 1.71. - Trust Fund
Trust Fund shall mean the fund established under the Trust Agreement by contributions made
by the Company, Participants and Merged Participants pursuant to the Plan, and from which any
distributions under the Plan are to be made. It shall be composed of separate Subfunds as
described in Section 1.66.
Section 1.72. - Trustee
Trustee shall mean the Trustee under the Trust Agreement.
Section 1.73. - Unmatched ATS Account
Unmatched ATS Account of a Participant shall mean the portion of his ATS Account so
designated, as described in Section 4.4.
Section 1.74. - Unmatched PTS Account
Unmatched PTS Account of a Participant shall mean his individual Account established in
accordance with Section 6.1.
Section 1.75. - Valuation Date
Valuation Date shall mean the close of every business day.
Section 1.76. - Vested
Vested, when used with reference to a Participants or Merged Participants Accounts, shall
mean non-forfeitable.
Section 1.77. - Years of Vesting Service
(a) Subject to subsection (b), Years of Vesting Service of an Employee, measured in
years and determined as of the point in time in question, shall mean 1/365th of his days of
Service (ignoring any fraction in the result).
(b) Years of Vesting Service shall also include all service treated as Vesting
Service under the provisions of
(i) the Paxar Corporation Employee Savings and Protection Plan as in effect before
employer contributions accounts were fully vested thereunder on January 1, 2002, and
(ii) the DM Label, Inc. Salary Savings Plan.
24
ARTICLE II.
ELIGIBILITY
Section 2.1. - Requirements for Participation
(a) Present Participants in the Plan shall continue to participate in the Plan.
(b) Except as provided in subsections (c) and (d), any other person who on the first day of
any calendar month
(i) is an Employee; and
(ii) is not employed in a Bargaining Unit
shall become a Participant on such day.
(c) Any Participant whose participation terminates shall again become a Participant effective
as of his first subsequent Hour of Service as an Employee provided that he satisfies subsection
(b).
(d) A former Employee who was not an Employee on the first day of the calendar month on which
he first met all other eligibility requirements shall become a Participant effective as of his
first subsequent Hour of Service as an Employee provided that he satisfies subsection (b).
Section 2.2. - Automatic Enrollment
(a) Except as provided in subsection (b), each eligible Employee shall automatically
contribute that whole number percentage of his Compensation to his PTS Account which is set
forth in Exhibit 5 of the Plan, effective as of the first Payday following his first Hour
of Service unless the Employee affirmatively elects to receive cash or make a contribution
to his PTS Account in a different specified amount within the limits of Section 3.1(a) in
accordance with Section 2.3. This contribution or election shall be effective for all
subsequent Paydays unless the automatic contribution or election to receive cash is
superseded by a subsequent election by the Participant, as described in Section 3.2 or 3.3.
The Vice President, Compensation and Benefits of Avery Dennison Corporation is authorized
to amend Exhibit 5 to reflect new automatic contribution percentages as described in this
paragraph.
(b) Solely with respect to each eligible Employee who was an active participant in the
Paxar Corporation Employee Savings and Protection Plan or the DM Label, Inc. Salary Savings
Plan on December 31, 2008 and becomes a Participant in this Plan as of January 1, 2009, the
automatic enrollment provisions of Section 2.2(a) do not apply. Instead, each such
Participant shall automatically contribute to his PTS Account that percentage of his
Compensation (if any) which he elected to contribute under the Paxar Corporation Employee
Savings Plan or the DM Label, Inc. Salary Savings Plan, as applicable, as of December 31,
2008, effective as of his first Payday as a Participant under the Plan unless such
Participant affirmatively elects to receive cash or make a contribution in a different
specified amount in accordance with Article III of the Plan after January 1,
25
2009. This contribution election shall be effective for all subsequent Paydays unless
it is superseded by a subsequent election of the Participant.
Section 2.3. - Notice of Right to Receive Cash and Election
(a) Initial Notice.
(i) As soon as administratively feasible after the eligible Employees first Hour of
Service, each eligible Employee shall receive written notice of his right to receive cash
instead of the automatic contribution to his PTS Account in the applicable amount described
in Exhibit 5 or to make a contribution to his PTS Account in a different specified amount.
Notwithstanding the foregoing, such written notice shall be treated as provided timely if it
is provided as soon as practicable after the first date that the automatic contribution
becomes effective for the eligible Employee which is prior to the pay date for the payroll
period that includes the date the Employee becomes eligible.
(ii) After receiving the notice, the eligible Employee shall have an effective
opportunity to affirmatively elect to receive cash instead of the automatic contribution to
his PTS Account or to contribute another specified amount to his PTS Account within the
limits of Section 3.1(a). Any such automatic contribution or election to receive cash may
be suspended or otherwise changed in accordance with the Rules of the Plan. The opportunity
to make these elections will be available during the opt-out period established by the
Administrator and which shall be at least 30 days long. However, a Participant who makes an
affirmative election to make contributions to his PTS Account before the opt-out period
expires, may begin such contributions as soon as administratively feasible after his
election is filed with the Administrator or its delegate.
(b) Annual Notice. At least 30 days (and not more than 90 days) before the
beginning of each Plan Year, each Employee who is covered in the automatic contribution
arrangement shall receive written notice of his right to receive cash instead of the
automatic contribution or to make a contribution to his PTS Account in a different
specified amount in accordance with the requirements set forth in Code Section 414(w)(4).
Section 2.4. - Inactive Status
(a) A Participant who is transferred directly to a Company Affiliate that is not a
Company or to a position or classification which is within a Bargaining Unit, shall
thereupon cease to be an Active Participant, except where after such transfer such
Participant is an Included Affiliate Employee.
(b) All provisions of the Plan shall otherwise continue to apply to such Participant,
except that he shall not make PTS contributions under Article III or make ATS contributions
under Article IV or share in allocations under Article VI and Section 18.4 while he is not
an Active Participant.
(c) If such a Participant is retransferred to a position or classification with the
Company which is not within a Bargaining Unit, he shall thereupon again be an Active
Participant, may again make PTS contributions under Article III and make ATS
contributions under Article IV and shall share in allocations under Article VI and
Section 18.4.
26
(d) A Participant who ceases to be an employee of a Company shall cease to be an Active
Participant and shall not be eligible to make PTS contributions under Article III and ATS
contributions under Article IV and shall not share in allocations under Article VI and Section 18.4
for periods beginning thereafter. In addition, the Participant shall cease to accrue Years of
Vesting Service for any period after he ceases to be an employee of a Company or a Company
Affiliate.
ARTICLE III.
PRETAX SAVINGS CONTRIBUTIONS
Section 3.1. - PTS Contributions
(a) Each Participant may elect, in accordance with the Rules of the Plan, to defer to
his PTS Account for any Plan Year, the sum of
(i) the lesser of
A the sum of
1 any whole number percentage of his Compensation (which does
not exceed the limit established by the Vice President, Compensation and
Benefits of Avery Dennison Corporation as set forth in Exhibit 5) for such
Plan Year (or other applicable period); provided, however, that such
election may, solely for administrative purposes, be treated as a percentage
of the Participants Pay, and
2 any excess credits permitted to be contributed hereto under
the Avery Dennison Corporations Flex Benefits Program, and
B except as provided in subsection (c), the excess of the limit under
Code Section 402(g) (as adjusted for any income allocable to such amount through the
end of the calendar year) over any amounts described in Code Section 402(g)(3) for
such calendar year and not deferred hereunder, and
(ii) any deferrals permitted under subsection (b).
(b) Each Catch-Up Eligible Participant may make additional deferrals to his PTS
Account for a Plan Year in the maximum amount permitted under Code Section 414(v) and
Treas. Reg. Section 1.414(v)-1 (or any successor thereto). A Participants election under
paragraph 3.1(a)(ii) for any Plan Year shall not take effect until he has received his
maximum Company contribution described in Section 6.3(b) for the Plan Year. The
Administrator shall apply the rules described in subsection (e) as necessary until the
Participant has received his maximum contribution under Section 6.3(b).
(c) (i) For Participants who are DB Eligible Participants, the first six percent of
Compensation so deferred shall be held for contribution to the Participants Basic PTS
Account, and the excess, if any, for his Unmatched PTS Account.
27
(ii) For Participants who are not DB Eligible Participants, the first four percent of
Compensation so deferred shall be held for contributions to the Participants Basic PTS
Account, and the excess, if any for his Unmatched PTS Account.
(d) (i) Subject to paragraph (ii), a Participant may elect to contribute the amounts of
his Compensation to his PTS Account and ATS Account which is set forth in Exhibit 5 during
the periods described therein.
(ii) In order to satisfy nondiscrimination requirements under the Code, a Participant
who is a Highly Compensated Employee for the period in question, may elect to contribute the
amounts of his Compensation to his PTS Account which is set forth in Exhibit 5 during the
periods described therein.
(iii) The Vice President, Compensation and Benefits of Avery Dennison Corporation is
authorized to adopt any amendment to Exhibit 5 to reflect new contribution limits under the
Plan.
(e) Any election under subsection (a) for a Participant who, in the Plan Year in
question, has made his maximum contribution to his PTS Account for such Plan Year, shall
automatically convert to an election under Section 4.1(a) in accordance with the Rules of
the Plan.
(f) [Reserved.]
Section 3.2. - Suspension of Deferral
A Participant may, upon such prior notice to the Administrator or its designated agent as is
required under the Rules of the Plan, elect to suspend deferral of his Compensation.
Section 3.3. - Commencement, Resumption or Change of Deferred Compensation
As permitted under the Rules of the Plan,
(a) a Participant in the Plan who previously declined to defer a percentage of his
Compensation may, upon such prior notice to the Administrator or its designated agent as
required under the Rules of the Plan, elect to commence deferral of his Compensation under
Section 3.1 within the limits thereof;
(b) after he has suspended deferral of his Compensation under Section 3.2, a
Participant may, upon notice to the Administrator or its designated agent as required under
the Rules of the Plan, elect to resume deferral of his Compensation under Section 3.1 within
the limits thereof; and
(c) a Participant may, upon prior notice to the Administrator or its designated agent
as required under the Rules of the Plan, elect to change his rate of deferral of his
Compensation within the limits of Section 3.1.
28
Section 3.4. - Deposit in Trust
A Participants deferrals shall be transmitted to the Trustee in accordance with subsections
5.1(a) and 5.3(a) and shall be invested by the Trustee in accordance with Article VII.
Section 3.5. - Deferral Percentage Fail-Safe Provisions
(a) For each Plan Year, the Deferral Percentage with respect to Participants who are Highly
Compensated Employees for the current Plan Year, shall be
(i) not more than 125 percent of, or
(ii) not more than two percentage points higher than, and not more than twice,
the Deferral Percentage for such Plan Year with respect to Participants who are not Highly
Compensated Employees for the preceding Plan Year (using the definition of such term that was in
effect during such preceding Plan Year) (Prior Year Testing Method), or such other amount as may
be required by Treasury Regulations under Code Section 401(m)(9). The Administrator may elect to
apply the Deferral Percentage for the group of Participants who are not Highly Compensated
Employees based on the current Plan Year rather than the preceding Plan Year (Current Year Testing
Method Election) and, if such election is made, the election shall be set forth in Exhibit 2. The
Current Year Testing Method Election once made shall apply for all subsequent Plan Years unless
changed by the Company to the Prior Year Testing Method; provided, however, that a Companys
Current Year Testing Method Election may be changed to the Prior Year Testing Method only as
described in Treas. Reg. Section 1.401(k)-2(c)(1). To the extent necessary to achieve such result
(and notwithstanding Sections 5.1(a) and 6.3(c)) as of the end of each Plan Year, the Administrator
shall take or cause to be taken one or more of the actions listed in subsection (b).
(b) In order to achieve the result described in subsections (a), the following actions shall
be taken, as provided under Code Section 401(k), the regulations thereunder and the Rules of the
Plan, in the order selected by the Administrator and to the extent necessary:
(i) The Administrator shall make any one or both of the elections provided in Section
1.19(b).
(ii) To the extent permitted by Code Section 401(a)(4) and Treas. Reg. §
1.401(k)-2(a)(6) (which are incorporated herein by this reference), the Company may make
additional contributions
A to the Qualified Non-Matching Accounts, or,
B to be applied to payment of Current Obligations
with the condition that the contributions under subparagraph A, or the shares of
Company Stock released from the Suspense Account pursuant to Sections 6.7 and 6.8 by reason
of the contributions under subparagraph A, shall be allocated to the Qualified
Non-Matching Accounts of certain Participants in inverse order of Compensation received in
the Plan Year in question (lowest compensated Participant receiving the first allocation)
with each Participant who receives an allocation receiving the maximum allocation permitted
by Code
29
Section 415 and Treas. Reg. Section 1.401(k)-2(a)(6) before any Participant with greater
Compensation receives any allocation, until such contribution is fully allocated.
(iii) Amounts otherwise to be credited under Section 6.3(b) to ESOP Accounts for such
Plan Year shall be credited instead to Qualified Matching Accounts of the Participants in
question.
(iv) Prior to the end of the following Plan Year, the amount of excess contributions
within the meaning of Treas. Reg. Section 1.401(k)-2(b)(2) (and any income thereon earned to
the earlier of the end of the Plan Year in which such excess contributions were made and the
date of distribution computed in a consistent and reasonable manner in accordance with
Section 8.2 and Code Section 401(a)(4)) for Participants who were Highly Compensated
Employees for the Plan Year shall be allocated according to the Leveling Method and
distributed to the Highly Compensated Employees in question in conformance with Treas. Reg.
Section 1.401(k)-2(b)(4)(ii).
(v) Within two and one-half months following the end of the Plan Year, the amount of
excess deferrals (and any income thereon earned to the earlier of the end of the Plan Year
in which such excess contributions were made and the date of recharacterization computed in
a consistent and reasonable manner in accordance with Section 8.2 and Code Section
401(a)(4)) for Highly Compensated Employees shall be allocated according to the Leveling
Method and recharacterized as personal contributions (and allocated to such Participants
ATS Account which amounts shall continue to be subject to the distribution limitations of
Treas. Reg. Section 1.401(k)-1(d)) for purposes of Code Sections 72, 401(a)(4), 401(k)(3)
and 6047 only and subject to any Plan limitations on personal contributions made by Highly
Compensated Employees (in which event the treatment of such amounts, including the Account
under this Plan to which allocated, shall be otherwise unaffected) for the Highly
Compensated Employee in question.
(c) The amount of any distributions under subsection (b) with respect to a Participant
for a Plan Year shall be reduced by any distributions made pursuant to Section 9.5(a)
previously distributed to such Participant for his taxable year ending with or within such
Plan Year. The amount of any distributions under Section 9.5(a) for any taxable year of a
Participant shall be reduced by amounts distributed to such Participant pursuant to
subsection (d) for the Plan Year beginning with or within such taxable year.
ARTICLE IV.
AFTER-TAX SAVINGS CONTRIBUTIONS
Section 4.1. - ATS Contributions
(a) Subject to subsection 3.1(e) and subsections (c) and (d), each Participant may elect (in
accordance with the Rules of the Plan) to contribute any whole number percentage of his
Compensation to his ATS Account in accordance with the limits described in Section 3.1(d);
provided, however, that such election may, solely for administrative purposes, be treated as a
percentage of the Participants Pay. However, he shall not knowingly contribute an amount which
would make his Annual Addition for the Plan Year in question exceed the limitations of Section
18.4.
30
(b) (i) For Participants who are DB Eligible Participants, the excess, if any, of the
first six percent of Compensation so elected as ATS Contributions over the contributions to
his Basic PTS Account shall be contributed to his Basic ATS Account and the remainder, if
any, to his Unmatched ATS Account.
(ii) For Participants who are not DB Eligible Participants, the excess, if any, of the
first four percent of Compensation so elected as ATS Contributions over the contributions to
his Basic PTS Account shall be contributed to the his Basic ATS Account and the remainder,
if any, to his Unmatched ATS Account.
(c) Any contributions which are invested in the Company Stock Fund pursuant to Section 7.1(a)
shall be applied to pay Current Obligations such that pursuant to Sections 5.1(b)(ii) and 7.1(b)
shares of Company Stock equal in value to the amount of such contribution shall be allocated to his
ATS Account.
(d) If any amount is contributed hereunder inadvertently making the Participants Annual
Addition exceed the maximum permissible amount for the Plan Year in question, the provisions of
Section 18.4 shall apply.
(e) [Reserved.]
(f) [Reserved.]
(g) [Reserved.]
Section 4.2. - Change, Commencement, Discontinuance or Resumption of ATS
Contributions
A Participant may elect to change his rate of contributions within the limits of Section 4.1,
or commence, discontinue or resume contributions under Section 4.1. Such elections shall be made
in accordance with the Rules of the Plan.
Section 4.3. - Withholding of ATS Contributions
A Participants contributions to his ATS Account under Section 4.1(a) shall be withheld each
Payday from his Compensation.
Section 4.4. - ATS Account
The Administrator shall maintain an ATS Account consisting of a Basic ATS Account and an
Unmatched ATS Account, for each Participant contributing to the Plan. To this Account shall be
credited his contributions (as described in Section 4.1(b)), debited his withdrawals under Sections
9.2 and 6.11(b) and debited or credited investment gains and losses and Annual Addition
adjustments.
Section 4.5. - Deposit in Trust
A Participants ATS contributions shall be transmitted to the Trustee as of the earliest date
on which such contributions can reasonably be segregated from the general assets of the Company,
but not later than the 15th business day of the month following the month in which the
31
contributions are received or withheld by the Company and shall be invested by the Trustee in
accordance with Article VII.
ARTICLE V.
CONTRIBUTIONS OF THE COMPANY
Section 5.1. - Determination of Annual Contribution
(a) (i) Subject to paragraph (ii) and Section 18.4, for each Payday, the Company shall
contribute to the Plan for each Participant an amount for his PTS Account which is the
amount of Deferred Compensation elected by such Participant under Section 3.1 or 3.3.
(ii) Any contributions which are invested in the Company Stock Fund shall be applied to
pay Current Obligations such that pursuant to Sections 5.1(b)(ii) and 7.1(b) shares of
Company Stock equal in value to the amount of such contributions shall be allocated to the
PTS Account of such Participant.
(b) (i) Subject to Section 16.1(b), the Company shall be obligated to contribute such
amounts, and at such times, as shall be necessary to provide the Trust with funds sufficient
to pay any Current Obligations (including principal, interest and any acquisition charges)
incurred for the purpose of acquiring Company Stock to be held in the Trust Fund.
(ii) For each Plan Year the Company shall make contributions in an amount such that the
number of shares of Leveraged Company Stock released from the Suspense Account pursuant to
Sections 6.7 and 6.8 is sufficient to allow the allocations required by Sections 6.3(b) and
7.1(b).
Section 5.2. - Maximum Annual Contribution
The Companys contribution for any Plan Year shall not exceed the maximum amount deductible by
the Company for such Plan Year under Code Sections 404(a)(3)(A) and 404(a)(9) and, in any event,
shall be less than that amount which would initially result in an Annual Addition of any
Participant which exceeds the maximum permissible amount under Section 18.4(a).
Section 5.3. - Contribution Date
(a) The Companys contributions
(i) under Section 5.1(a) shall be made as of the earliest date on which such
contributions can reasonably be segregated from the general assets of the Company but not
later than the 15th business day of the month following the month in which the deferral is
withheld by the Company under Section 3.1 or 3.3, and
(ii) under Section 5.1(b) shall be made on or before the date upon which the Companys
federal income tax return is due (including extensions thereof) for its taxable year in
question
and shall be transmitted to the Trustee and held in the Trust Fund.
32
(b) If the Company makes a contribution after the end of the Plan Year for
which the contribution is made
(i) the Company shall notify the Trustee in writing that the contribution is made for
such Plan Year,
(ii) the Company shall claim such payment as a deduction on its federal income tax
return for its taxable year, and
(iii) the Administrator and the Trustee shall treat the payment as a contribution by
the Company to the Trust actually made on the last day of such taxable year.
Section 5.4. - Form of Contributions
The Companys contributions to the Trust Fund shall be paid in cash, Company Stock or such
other property as the Board may from time to time determine; provided, however, that Company
contributions shall be paid in cash to the Trust Fund to the extent necessary to discharge the
Current Obligations of the Trust.
ARTICLE VI.
PARTICIPATION IN COMPANY CONTRIBUTIONS AND FORFEITURES
Section 6.1. - PTS Account
The Administrator shall maintain for each Participant a PTS Account, consisting of a Basic PTS
Account and an Unmatched PTS Account, to which shall be credited the amounts determined under
Section 5.1(a), debited amounts withdrawn under Section 3.5(b), 9.3, 9.5, 9.6 and 10.3 and to which
shall be debited or credited the amounts determined under Section 8.2 and 18.4.
Section 6.2. - ESOP Account; Qualified Account
(a) The Administrator shall maintain an ESOP Account for each Participant to which
shall be credited the amounts allocated thereto under Sections 6.3(b) and 18.4 and to which
shall be credited or debited amounts determined under Section 8.2.
(b) The Administrator shall maintain a Qualified Account for each Participant
consisting of a Qualified Matching Account and a Qualified Non-Matching Account to which
shall be credited the amounts allocated thereto under Sections 6.11(b)(iii), (iv) and (vi)
and 3.5(b)(ii) and (iii) and to which shall be credited or debited amounts deferred under
Section 8.2.
Section 6.3. - Allocation of Company Contributions and ESOP Stock
(a) Except as provided in Section 18.4(a), Company contributions under Section 5.1(a)(i) shall
be allocated as provided therein.
(b) (i) For Participants who are DB Eligible Participants, except as provided in
Section 18.4(a), for each Payday, there shall be allocated to the ESOP Account of each DB
Eligible Participant the number of shares (including fractional shares) of Company Stock,
33
valued under Section 8.1(b) in accordance with the Rules of the Plan, equal to the sum
of fifty percent of the total of his contributions to the Basic ATS Account and Basic PTS
Account for such Payday; provided, however, that no such allocations shall be made with
respect to deferrals as described in Section 3.1(b).
(ii) For Participants who are not DB Eligible Participants, except as provided in
Section 18.4(a), for each Payday, there shall be allocated to the ESOP Account of each such
Participant the number of shares (including fractional shares) of Company Stock, valued
under Section 8.1(b) in accordance with the Rules of the Plan, equal to the sum of one
hundred percent of the total of his contributions to the Basic ATS Account and Basic PTS
Account for such Payday; provided, however, that no such allocations shall be made with
respect to deferrals as described in Section 3.1(b).
Section 6.4. - Allocation of Cash Dividends
Any cash dividends received by the Trustee on Company Stock shall, at the direction of the
Administrator and in its sole discretion,
(a) If received on shares of Company Stock allocated to Stock Accounts, shall be
immediately vested and
(i) be used to make payments on any installment contract or loan used to
acquire Leveraged Company Stock in accordance with Code Section 404(k)(2)(A)(iv);
provided, however, that such dividends shall not be so used unless the requirement
of Section 6.8(c) is satisfied,
(ii) be paid in cash to Participants or their Beneficiaries,
(iii) be paid to the Plan and distributed to Participants not later than ninety
days after the last day of the Plan Year in which paid in accordance with Code
Section 404(k)(2)(A)(ii),
(iv) be paid to the Plan and allocated to the applicable Cash Accounts, or
(v) at the election of such Participants or their Beneficiaries,
(A) be payable as provided in paragraphs (ii) or (iii) or
(B) be paid to the Plan, reinvested in Company Stock and allocated to
the applicable Stock Accounts, and
(b) if received on shares of Company Stock allocated to the Suspense Account,
(i) be used to make payments on any installment contract or loan used to
acquire Leveraged Company Stock in accordance with Code Section 404(k)(2)(A)(iii),
or
(ii) be allocated to the Suspense Account.
34
Section 6.5. - Allocation of Stock Dividends
Stock dividends received by the Trustee on Company Stock shall be credited to Stock Accounts
and to the Suspense Account in proportion to the shares of Company Stock therein. Any cash
received by the Trustee (in connection with such a stock dividend) in lieu of fractional shares
shall be allocated under Section 6.4.
Section 6.6. - [Reserved]
Section 6.7. - Suspense Account
At such time as any Leveraged Company Stock is acquired for the Trust Fund, the Administrator
shall open and maintain a Suspense Account for the purpose of holding unallocated Leveraged Company
Stock until such Company Stock is released and allocated in accordance with the provisions of
Section 6.8.
Section 6.8. - Release and Allocation of Leveraged Company Stock
(a) All Leveraged Company Stock acquired for the Trust Fund shall be held in the Suspense
Account until released and allocated in accordance with the provisions of this Section. Leveraged
Company Stock acquired in a particular transaction shall be released from the Suspense Account as
follows:
(i) Subject to the requirements of Treasury Regulation Section 54.4975-7(b)(8)(ii) and
subsection (ii) below, for each Plan Year until the loan or installment obligation is fully
repaid, the number of shares of Leveraged Company Stock released from the Suspense Account
shall equal the number of unreleased shares immediately before such release for the then
current Plan Year multiplied by a fraction, the numerator of which is the amount of
principal paid on such loan during such current Plan Year and the denominator of which is
the sum of said numerator plus the principal to be paid on such loan in all future years
during the duration of the term of such loan (determined without reference to any possible
extensions or renewals thereof). Notwithstanding the foregoing, in the event such loan or
obligation shall be repaid with the proceeds of a subsequent loan, such repayment shall not
operate to release all such Leveraged Company Stock but rather such release shall be
effected pursuant to the foregoing provisions of this Section on the basis of payments of
principal on such substitute loan.
(ii) To the extent that paragraph (i) is not applicable by its terms by reason of
Treasury Regulation Section 54.4975-7(b)(8)(ii), or if the Administrator irrevocably so
elects at the time of the first payment on the loan, then paragraph (i) shall be applied
with respect to all payments on such loan by deeming all references to principal therein
to be references to principal and interest.
(iii) If the release is determined with reference to principal payments only, the
following three additional rules apply.
(A) The loan must provide for annual payments of principal and
interest at a cumulative rate that is not less rapid at any time than
level annual payments of such amounts for 10 years.
35
(B) Interest included in any payment is disregarded only to the
extent that it would be determined to be interest under standard loan
amortization tables.
(C) Subsection (iii)(C) above is not applicable from the time
that, by reason of a renewal, extension or refinancing, the sum of
the expired duration of the exempt loan, the renewal period, the
extension period and the duration of a new exempt loan exceeds 10
years.
(b) The Company shall specify, and advise the Trustee with respect to
(i) the amount (if any) of each Company contribution (together with the earnings
thereon) that is to be applied towards the payment of Current Obligations,
(ii) the amount (if any) of cash dividends on Company Stock held in the Stock Accounts
that is to be applied towards the payment of Current Obligations, and
(iii) the amount (if any) of cash dividends on Company Stock held in the Suspense
Account that is to be applied towards the payment of Current Obligations.
(c) Cash dividends paid on Company Stock held in Stock Accounts may be applied towards the
payment of any installment contract or loan used to acquire Leveraged Company Stock; provided,
however, that such dividends shall be so applied only if Leveraged Company Stock with an aggregate
fair market value equal to or greater than the amount of such cash dividends is allocated to
Participants Stock Accounts; provided, further, that such allocation shall be made with respect to
the Plan Year in which such cash dividends would have been allocated to Participants Cash
Accounts.
Section 6.9. - Application of Forfeitures
Amounts forfeited in any Plan Year under Sections 12.2(a)(iii), 13.2 and 15.8 shall be applied
under Section 5.1(b) to reduce the Companys contribution for such Plan Year and shall be allocated
under Section 6.3(b) as if part of such contribution for such Plan Year. Alternatively and as
determined by the Administrator, any portion of such forfeitures may be used to pay reasonable
administrative expenses of the Plan.
Section 6.10. - Diversification
(a) A Participant may elect to have up to the entire amount credited to his Stock Account
applied, pursuant to Article VII and the Rules of the Plan, to investment in such (three or more)
Subfunds as are designated for such purpose under the Rules of the Plan (and notwithstanding any
contrary, otherwise applicable, Rule of the Plan). Such elections shall be made on such forms or
such other documents or communications as are prescribed by the Administrator.
(b) (i) A Participant may elect to have up to the entire amount credited to his SHARE
Stock Account (described in Supplement I) diversified in accordance with subsection (a) if
he has attained age 50.
36
(ii) A Participant not described in paragraph (b)(i) who has completed at least three
Years of Vesting Service shall be permitted to diversify his SHARE Account according to the
following schedule:
|
|
|
|
|
|
|
Percentage of SHARE Account |
Plan Year |
|
invested in Company Stock |
December 1, 2007 to November 30, 2008
|
|
|
33 |
% |
December 1, 2008 to December 31, 2008
|
|
|
66 |
% |
Effective January 1, 2009 and all
subsequent Plan Years
|
|
|
100 |
% |
(c) An alternate payee under a qualified domestic relations order or Beneficiary of a
deceased Participant may diversify his SHARE Account at any time.
Section 6.11. - Contribution Percentage Fail-Safe Provisions
(a) For each Plan Year, the Contribution Percentage with respect to Participants who are
Highly Compensated Employees for the current Plan Year, shall be
(i) not more than 125 percent of, or
(ii) not more than two percentage points higher than, and not more than twice,
the Contribution Percentage for such Plan Year with respect to Participants who are not Highly
Compensated Employees for the preceding Plan Year (using the definition of such term that was in
effect during such preceding Plan Year) (Prior Year Testing Method), or such other amount as may
be required by Treasury Regulations under Code Section 401(m)(9). The Administrator may elect to
apply the Contribution Percentage for the group of Participants who are not Highly Compensated
Employees based on the current Plan Year rather than the preceding Plan Year (Current Year Testing
Method Election) and, if such election is made, the election shall be set forth in Exhibit 2. The
Current Year Testing Method Election once made shall apply for all subsequent Plan Years unless
changed by the Company to the Prior Year Testing Method; provided, however, that a Companys
Current Year Testing Method Election may be changed to the Prior Year Testing Method only as
described in Treas. Reg. Section 1.401(m)-2(c)(1).
(b) In order to achieve the result described in subsections (a) and (c) (and notwithstanding
Sections 5.1(a) and 6.3(b), as of the end of each Plan Year, the Administrator shall take or cause
to be taken any of the following actions, in the order selected by the Administrator, (but after
application of Section 3.5) and to the extent necessary:
(i) The Administrator shall make any one or both of the elections provided in Section
1.19(b).
(ii) Allocations to PTS Accounts shall be taken into account for purposes of
calculating the Contribution Percentage.
37
(iii) To the extent permitted by Code Section 401(a)(4) and Treas. Reg. §
1.401(m)-2(a)(6) (which are incorporated herein by this reference), the Company may make an
additional contribution
A to the Qualified Non-Matching Accounts, or
B to be applied to payment of Current Obligations
with the condition that the contributions under subparagraph A, or the shares of
Company Stock released from the Suspense Account pursuant to Sections 6.7 and 6.8 by reason
of the contributions under subparagraph A, shall be allocated to the Qualified
Non-Matching Accounts of Participants in inverse order of Compensation received in the Plan
Year in question (lowest compensated Participant receiving the first allocation) with each
Participant who receives an allocation receiving the maximum allocation permitted by Code
Section 415 and Treas. Reg. Section 1.401(m)-2(a)(6) before any Participant with greater
Compensation receives any allocation, until such contribution is fully allocated.
(iv) To the extent permitted by Code Section 401(a)(4), amounts otherwise to be
credited under Section 6.3(b) to ESOP Accounts for such Plan Year shall be credited instead
to Qualified Matching Accounts of the Participants in question.
(v) Prior to the end of the following Plan Year, the amount of excess aggregate
contributions within the meaning of Treas. Reg. Section 1.401(m)-2(b)(2) (and any income
thereon earned to the earlier of the end of the Plan Year in which such excess aggregate
contributions were made and the date of distribution (or forfeiture) computed in a
consistent and reasonable manner in accordance with Section 8.2 and Code Section 401(a)(4))
for Participants who were Highly Compensated Employees for the Plan Year shall be allocated
according to the Leveling Method. To the extent Vested (and, with respect to matching
contributions, in conformity with Treas. Reg. Section 1.401(m)-2(b)(3)(v)(B)), this amount
shall then be distributed to the Highly Compensated Employees in question and, to the extent
not Vested, shall be forfeited and reapplied under Section 6.9.
(vi) To the extent permitted by Code Section 401(a)(4) and Treas. Reg. §
1.401(m)-2(a)(6) (which are incorporated herein by this reference), amounts credited in
accordance with paragraph (iv) to Qualified Matching Accounts for such Plan Year shall
instead be allocated in disproportionately higher amounts to Participants who are not Highly
Compensated Employees and in disproportionately lower amounts to Participants who are Highly
Compensated Employees using the same aggregate dollar amounts that would otherwise have been
allocated pursuant to Section 6.3(b).
Section 6.12. - Reemployment Rights after Qualified Military Service
(a) Solely for purposes of this Section 6.12, the following definitions shall apply:
(i) Qualified Military Service shall mean any service in the uniformed services (as
defined in chapter 43 of title 38, United States Code) by any individual if such individual
is entitled to reemployment rights under such chapter with respect to such service.
(ii) Compensation shall mean
38
a Compensation the Employee would have received during his period of
Qualified Military Service if the Employee were not in Qualified Military Service,
determined based on the rate of pay the Employee would have received from the
Company but for absence during his period of Qualified Military Service, or
b if the Compensation the Employee would have received during his
period of Qualified Military Service was not reasonably certain, the Employees
average Compensation from the Company during the 12-month period immediately
preceding the Qualified Military Service (or, if less, the period of employment
immediately preceding the Qualified Military Service).
(b) A Participant who leaves the Company as a result of Qualified Military Service and returns
to employment with the Company may elect during the period described in subsection (c) to make
additional deferrals to his PTS Account and contributions to his ATS Account under the Plan in the
amount determined under subsection (d) or such lesser amount, as elected by the Participant.
(c) The period determined under this subsection shall be the period which begins on the date
of the Employees reemployment with the Company after his Qualified Military Service that extends
until the lesser of
(i) the product of 3 and the period of Qualified Military Service, and
(ii) 5 years.
(d) The amount described in this subsection is the maximum amount of deferrals to the
Participants PTS Account and contributions to his ATS Account that the Participant would have been
permitted to make in accordance with the limitations described in subsection (f)(i) during the
Participants period of Qualified Military Service if the Participant had continued to be employed
by the Company during such period and received Compensation. Proper adjustment shall be made for
any contributions actually made during the Participants period of Qualified Military Service.
(e) If the Participant elects to make deferrals to his PTS Account and/or contributions to his
ATS Account under subsection (b), the Company shall make such a matching contribution to his ESOP
Account with respect to such deferrals and/or contributions as would have been required under the
Plan had such deferrals and/or contributions actually been made during the period of such Qualified
Military Service.
(f) If any deferral or contribution is made by a Participant or the Company pursuant to this
Section,
(i) such deferral or contribution shall not be subject to any otherwise applicable
limitation contained in Code Section 402(g), 404(a) or 415 and shall not be taken into
account in applying such limitations to other deferrals, contributions or benefits under the
Plan or any other plan, with respect to the Plan Year in which the deferral or contribution
is made,
39
(ii) such deferral or contribution shall be subject to the limitations described in
paragraph (i) with respect to the Plan Year to which the deferral or contribution relates in
accordance with the rules prescribed by the Secretary of the Treasury,
(iii) the Plan shall not be treated as failing to meet the requirements of Code Section
401(a)(4), 401(k)(3), 401(k)(11), 401(k)(12), 401(m), 410(b) or 416 by reason of the making
of (or the right to make) such deferral or contribution.
(g) The Company shall not credit earnings on any deferral or contribution made under this
Section before such deferral or contribution is actually made.
(h) A Participant reemployed under subsection (b) shall be treated as not incurring a Break in
Service Year by reason of his period of Qualified Military Service. For purposes of calculating
the Participants Years of Vesting Service, the Participant shall be credited with an Hour of
Service for each hour which would have been credited to him but for his Qualified Military Service.
ARTICLE VII.
INVESTMENT OF ACCOUNTS
Section 7.1. - Subfunds
(a) As permitted under the Rules of the Plan, a Participants or Merged Participants
Accounts (other than the initial contribution to his ESOP Account) shall be invested in any
whole number percentage among the Subfunds as the Participant or Merged Participant shall
elect.
(b) Contributions under Sections 4.1(c) and 5.1(a)(ii) invested in the Company Stock
Fund shall be invested in that number of shares of Company Stock (valued pursuant to
Section 8.1(b)(i)), released from the Suspense Account or otherwise held by the Trust which
is equal in value to the amount to such contributions.
(c) As permitted under the Rules of the Plan, a Beneficiary may elect to have his
Accounts held and invested under any investment option or options available under
subsection (a) or to change any such prior such election as described in Section 7.3.
(d) The Plan is a plan which is described in ERISA Section 404(c) under which each
Participant or Beneficiary shall exercise control over the assets in his Accounts and shall
be provided the opportunity to choose, from a broad range of investments, the manner in
which the assets in his Accounts are invested. The Participant or Beneficiary shall not be
deemed to be a fiduciary by reason of his exercise of control and no person who is
otherwise a fiduciary shall be liable for any loss or by reason of any breach which results
from such exercise of control, whether by the Participants or Beneficiarys affirmative
direction or failure to direct an investment. In addition, no Participants or
Beneficiarys Account shall bear any loss or have any responsibility or liability for any
investment directed by any other Participant or Beneficiary with respect to his Accounts.
40
Section 7.2. - Investment of New Contributions
Subject to Section 7.1 and in accordance with the Rules of the Plan, each Participant may
designate the proportions in which new contributions to his Accounts (other than the initial
contribution to his ESOP Account) are to be allocated among the Subfunds.
Section 7.3. - Investment Transfers
Subject to the Rules of the Plan, each Participant, Merged Participant or Beneficiary may
change the investment elections made under Sections 7.1 and 7.2 by electing to have the assets in
his Accounts (other than the Participants initial contribution to his ESOP Account) invested in
any Subfund transferred to any other Subfund.
Section 7.4. - Transfer of Assets
In accordance with the Rules of the Plan, the Administrator shall direct the Trustee to make
such transfers of money or other property among the Subfunds as may be necessary to effect the
aggregate of the transfer transactions (after the Administrator has caused the necessary entries to
be made in the Participants, Merged Participants or Beneficiarys Accounts in the Subfunds and
has reconciled offsetting transfer elections).
Section 7.5. - Effect of Non-Election
The Administrator has established one or more investment funds under subsection 7.1 which
shall be qualified default investment alternatives within the meaning of ERISA Section 404(c)(5)
and ERISA Regulation Section 2550.404c-5(e). In the absence of an investment election by a
Participant or Beneficiary, his contributions (and contributions made on his behalf) (including
earnings thereon) shall be invested, as determined by the Administrator. Each Participant and
Beneficiary shall be treated as exercising control over the assets in his Accounts with respect to
the amount of contributions and earnings which are invested in a qualified default investment
alternative. In addition, no person who is otherwise a fiduciary shall be liable for any loss or
by reason of any breach which results from such Participants or Beneficiarys exercise of control.
Each applicable Participant and Beneficiary shall receive a notice in accordance with ERISA
Section 404(c)(5)(B) and ERISA Regulation Section 2550.404c-5(c)(3) explaining his right to
designate how his contributions (and contributions made on his behalf) and earnings thereon will be
invested and how, in the absence of any investment election by the Participant or Beneficiary, such
contributions and earnings will be invested in one or more qualified default investment
alternatives.
ARTICLE VIII.
VALUATION OF THE TRUST FUND AND ACCOUNTS
Section 8.1. - Determination of Values
(a) As of each Valuation Date, the Administrator shall determine the fair market value of each
asset in each Subfund other than Company Stock in compliance with the principles of Section 3(26)
of ERISA and regulations issued pursuant thereto, based upon information reasonably available to it
including data from, but not limited to, newspapers and financial publications of general
circulation, statistical and valuation services, records of securities exchanges, appraisals by
41
qualified persons, transactions and bona fide offers in assets of the type in question and
other information customarily used in the valuation of property for purposes of the Code. The
value of any real property held in the Trust Fund determined as of the end of any Plan year shall
be considered to remain unchanged until the end of the fourth quarter of the following Plan Year.
With respect to securities for which there is a generally recognized market, the published selling
price on or nearest to such valuation date shall establish the fair market value of such security.
Fair market value so determined shall be conclusive for all purposes of the Plan and Trust.
(b) (i) Subject to the special valuation rules set forth in paragraphs (ii) and (iii),
Company Stock contributed by the Company to the Trust Fund shall be initially valued at its
fair market value as of the date of contribution. Any Company Stock acquired by the Trust
Fund with cash shall be initially valued at the purchase price paid by the Trust.
Thereafter, such Company Stock shall be valued as of each Valuation Date.
(ii) In the case of Leveraged Company Stock, the following special valuation rules
shall apply:
A For purposes of valuing such Leveraged Company Stock in any
transaction between the Plan and any disqualified person as that term is defined
in Code Section 4975(e)(2), fair market value shall be determined as of the date of
the transaction in good faith by the Administrator in accordance with Section 3(18)
of ERISA.
B For purposes of a Participants exercise of his put option rights (if
applicable) under Article XVII, such Leveraged Company Stock shall be valued as of
the end of the most recent Plan Year.
(iii) Notwithstanding the foregoing provisions, in all cases the valuation provisions
of this Section, including the selection of a valuation date for any purpose under this
Plan, shall be interpreted and applied in a manner consistent with the applicable
requirements under Code Sections 409 and 4975(e)(7), the Treasury Regulations issued
thereunder, and any related or successor statutes or regulations, that must be satisfied in
order to qualify for the prohibited transaction exemption under Code Section 4975(d)(3). In
this connection, all valuations of Company Stock contributed to or acquired by the Plan
which at the time of such valuation is not readily tradable on an established securities
market within the meaning of Code Section 401(a)(28) shall be made by an independent
appraiser (within the meaning of Code Section 170(a)(1)), whose name shall be reported to
the Internal Revenue Service.
Section 8.2. - Allocation of Values
The difference between the total value of the assets of each Subfund except the Company Stock
Fund, as determined under Section 8.1, and the total of the Accounts therein, shall be allocated by
the Administrator among such Accounts in proportion to their respective stated values as of such
Valuation Date, such values and determinations being made without taking into account ATS, PTS or
Company contributions attributable to the Valuation Date; provided, however, that gains and losses
shall not be allocated with respect to amounts being held in suspense under Section 18.4(b).
42
Section 8.3. - Applicability of Account Values
The value of an Account, as determined as of a given date under this Article, plus any amounts
subsequently credited thereto under Sections 3.5, 4.4, 6.1, 6.2, 6.3, 6.4, 6.5, 6.6, 6.8, 6.11,
8.2, 15.8 and 18.4 (or applicable Supplements) less any amounts withdrawn under Sections 9.2, 9.3,
9.5, 9.6 and 10.3 (or applicable Supplements) or transferred to suspense under Section 18.4(b),
shall remain the value thereof for all purposes of the Plan and Trust until revalued hereunder.
ARTICLE IX.
VESTING AND WITHDRAWALS
Section 9.1. - Vesting of Accounts
(a) Each Participants or Merged Participants interest in each of his Accounts other than his
ESOP Account shall be Vested at all times, except as otherwise provided in any Supplement to the
Plan.
(b) Except as provided in Section 14.3(a) and subsection (c), a Participants or Merged
Participants ESOP Account shall not be Vested until he completes three Years of Vesting Service at
which time it shall become fully Vested. Upon any amendment of this vesting schedule, a
Participant with at least three Years of Vesting Service may elect to have his Vested percentage
calculated pursuant to the vesting schedule which would have been in effect but for this amendment.
(c) The interest of a Participant or Merged Participant in his ESOP Account shall become fully
Vested upon the earliest to occur of
(i) his death (including his death while performing qualified military service, as
required under Code Section 401(a)(37)),
(ii) his sixty-fifth birthday, or
(iii) the termination or discontinuation of the Plan under Section 16.1,
if he is then an affected Employee or employed by a Company Affiliate.
(d) (i) The Administrator shall designate on Exhibit 3 to the Plan which is attached
hereto and incorporated in the Plan by this reference the Affected Participants as defined
in paragraph (ii) who shall become fully Vested in their Accounts upon their severance from
employment with the Company.
(ii) Affected Participants are Participants who cease to be Employees and active
Participants under the Plan as a result of a sale or other acquisition of a Company (or any
portion thereof).
Section 9.2. - Unrestricted Withdrawals
(a) Subject to the Rules of the Plan, once each Plan Year and, if the Administrator
determines that a Hardship (including, for this purpose, an event described in Section
1.34(a)(viii)b) has occurred, and on one additional occasion in such Plan Year, a
43
Participant who is an Employee may withdraw up to one hundred percent of his ATS
Account (and not less than $1,000 or if less, the entire amount of his ATS Account) and
Company Contributions Account (as described in Supplement H) and such other Accounts
described in any Supplement, as permitted under the Rules of the Plan.
(b) A Participant who makes a withdrawal under subsection (a) shall not be permitted
to make any contributions to the Plan and shall not receive a contribution under subsection
6.3(b) for three months or such other periods as are specified in the Rules of the Plan.
Section 9.3. - Restricted Withdrawals
(a) Any Participant who is an Employee shall be permitted to make a cash withdrawal,
in any whole percentage increment or dollar amount, of up to one hundred percent of the
unwithdrawn principal amount in his PTS Account and up to the total amount of his Rollover
Account, on account of Hardship, subject to the conditions of Section 9.4
(b) Application for withdrawals shall be made on such forms as the Administrator
prescribes and may be made at any time. A withdrawal shall become effective in accordance
with the Rules of the Plan.
Section 9.4. - Conditions for Hardship Withdrawal
Hardship withdrawals shall be subject to the following conditions:
(a) A Participants aggregate Hardship withdrawals shall not exceed the lesser of
(i) the lesser of
a the amount by which
1 the aggregate amount of
A the principal amount of his PTS Account together with
income allocable thereto credited as of December 31, 1988,
B the total amount of his Qualified Account credited as
of December 31, 1988 (including income allocable thereto as of such
date), and
C the total amount of his Rollover Account exceeds
2 the greater of
A the unpaid amount due on his outstanding loan or
loans, if any under subsection (c)(i), or
44
B the amount of any previous distributions of his PTS
Account, and
b the amount which is necessary to satisfy the Hardship (including any
amounts necessary to pay any federal, state or local income taxes or penalties
reasonably anticipated to result from the distribution), or
(ii) the amount which cannot be satisfied from other resources which are reasonably
available to the Participant.
(b) The conditions of subsections (c) and (d) shall be satisfied.
(c) The conditions of this subsection are:
(i) the Participant shall obtain all currently available distributions (including
distributions under Section 6.4 but not other Hardship distributions) and all nontaxable
loans currently available under all plans within the meaning of Treas. Reg. Section
1.401(k)-1(d)(3)(iv)(F) maintained by the Company or any Company Affiliate; and
(ii) the Participant shall not be permitted to make further deferrals of Compensation
or voluntary contributions under the Plan or other plan within the meaning of Treas. Reg.
Section 1.401(k)-1(d)(3)(iv)(F) (whether or not qualified) maintained by the Company or any
Company Affiliate for six months thereafter.
(d) The conditions of this subsection, if any, shall be those prescribed by the
Commissioner of Internal Revenue through the publication of revenue rulings, notices,
and/or other documents of general applicability, as an alternate method under which a
Hardship distribution will be deemed to be necessary to satisfy an immediate and heavy
financial need.
(e) A Participant whose deferrals have been suspended under subsection (c)
nevertheless shall be included in determinations under Sections 1.20 and 1.22 if he would
otherwise be so included.
(f) [Reserved.]
(g) [Reserved.]
(h) The Participants remaining PTS Account or Rollover Account balance, or, if none,
the withdrawal itself shall be reduced by the amount of any administrative expenses charged
to the Trust Fund by reason of the withdrawal.
Section 9.5. - Withdrawal by Reason of Contribution Limitations
The Administrator may permit a Participant to make a lump sum withdrawal from his PTS Account
in the event of
(a) a deferral in excess of the limitation of Section 3.1(a)(i)(B), in the
amount of principal and interest or loss (including any interest or loss during the gap
period,
45
in accordance with Treas. Reg. Section 1.402(g)-1(e)(5) through November 30, 2008)
allowed by Code Section 402(g)(2)(A)(ii),
(b) a deferral in excess of the limitation of Section 3.5, in the amount of principal
and interest allowed by Code Section 401(k)(8) (in which case the Participant shall be
deemed to notify the Administrator of such excess amounts made to the Plan and any other
plans of the Company or a Company Affiliate),
(c) the circumstances specified in Code Sections 401(k)(2)(B)(i) and 401(k)(10).
(d) the circumstances specified in Section 18.4(b).
See also Section 10.3.
Section 9.6. - Withdrawals Upon Attainment of Age Fifty-Nine and One Half
A Participant or a Merged Participant who remains in the employ of the Company after attaining
age fifty-nine and one-half may elect in accordance with the Rules of the Plan to receive a
distribution of all or any portion of his Qualified Account or his PTS Account in one lump sum.
Such distributions shall not be made more frequently than at twelve month intervals.
Section 9.7. - Qualified Accounts and Stock Accounts
No withdrawals from Qualified Accounts are permitted, except pursuant to Sections 9.4 and 9.6.
No withdrawals or loans from Stock Accounts are permitted.
Section 9.8. - Withdrawals from Subfunds
The Rules of the Plan shall designate the order of withdrawal from the available Subfunds when
a Participant makes a withdrawal from his Accounts under Sections 9.2, 9.3, 9.5 or 9.6.
ARTICLE X.
EMPLOYMENT AFTER NORMAL RETIREMENT DATE
Section 10.1. - Continuation of Employment
(a) A Participant or a Merged Participant may, subject to subsection (b) and Section
18.3, remain in the employ of the Company or a Company Affiliate after attaining his Normal
Retirement Date.
(b) Notwithstanding subsection (a), the Company reserves the right to require a
Participant or a Merged Participant to retire in accordance with Section 12(c) of the Age
Discrimination in Employment Act of 1967, as amended, Section 12942 of the California
Government Code, and other applicable state law.
46
Section 10.2. - Continuation of Participation
A Participant retained in the employ of the Company after his Normal Retirement Date under
Section 10.1 shall continue as an Active Participant herein.
Section 10.3. - Mandatory In-Service Distributions
(a) A Participant or a Merged Participant who is a five percent owner (as defined in
Code Section 416) of the Company or a Company Affiliate with respect to the Plan Year
ending in the calendar year in which such Participant attains age 70 1/2 shall commence the
receipt of the entire amount credited to his Accounts in accordance with Section 11.3(a),
(b), (c), and (d)(ii) on the April 1 following the end of the calendar year in which he
attains age 70 1/2, except as provided in subsection 11.3(f).
(b) A Participant or a Merged Participant not described in subsection (a) who attains
age 70 1/2 after December 31, 1995 and before January 1, 1999 may elect to commence the
receipt of the entire amount credited to his Accounts beginning on a date during the period
which begins on or after January 1 of the calendar year in which he attains age 70 1/2 and
ends on the April 1 of the immediately following calendar year or he may elect to defer
such distributions until the April 1 following the calendar year in which his Separation
from the Service occurs.
(c) A Participant or a Merged Participant not described in subsection (a) who attains
age 70 1/2 prior to January 1, 1996 and was required to receive one or more distributions
of his Accounts by December 31, 1996 because he had reached his required beginning date,
as the term was defined under Code Section 401(a)(9) prior to January 1, 1997, may elect to
defer such distributions until the April 1 following the calendar year in which his
Separation from the Service occurs.
ARTICLE XI.
BENEFITS UPON RETIREMENT
Section 11.1. - Normal or Disability Retirement
Subject to the provisions of Section 10.1, a Participant or a Merged Participant shall retire
upon his Normal or Disability Retirement Date.
Section 11.2. - Rights Upon Normal or Disability Retirement
Upon a Participants or Merged Participants Normal or Disability Retirement, he shall be
entitled to receive the entire amount credited to his Accounts in accordance with Section 11.3.
Section 11.3. - Distribution of Accounts
(a) Subject to Section 15.17, if the entire amount credited to a Participants, former
Participants or Merged Participants Accounts (including the value of any shares credited
to his Stock Accounts if any and including any Accounts described in any applicable
Supplement) does not exceed $1,000 (excluding his Rollover Account to the
47
extent it consists of rollover contributions described in Code Section 411(a)(11)(D)),
such Participant shall receive such amount in one lump sum in the form of cash and/or the
Participants promissory note under Section 15.14 (except that at the option of such
Participant his Stock Accounts, if any, and the portion of his Accounts invested in the
Company Stock Fund will be paid in the form of Company Stock).
(b) Subject to Section 15.17, if the entire amount credited to a Participants, former
Participants or Merged Participants Accounts (including the value of any shares credited
to his Stock Accounts, if any and including any Accounts described in any applicable
Supplement) exceeds $1,000 (excluding his Rollover Account to the extent it consists of
rollover contributions described in Code Section 411(a)(11)(D)), such Participant may elect
to receive such amount under one of the following options (except that any Participant
promissory note under Section 15.14 shall be distributed in kind):
(i) Payment of such amount in one cash lump sum (except that at the option of such
Participant his Stock Accounts, if any, and the portion of his Accounts invested in the
Company Stock Fund will be paid in the form of Company Stock).
(ii) Payment of such amount directly from the Trust Fund (as adjusted for gains and
losses), in uniform annual or more frequent installments of at least $100 (as to which such
Participant (or his Spouse, if applicable) may elect whether the recalculation rule of Code
Section 401(a)(9)(D) shall apply and provided, however, that the first installment may be
larger than the remaining installments) to such Participant over a period not longer than
the lesser of
a the joint and last survivor expectancy of him and his Spouse, if any,
reasonably determined from the expected return multiples prescribed in Treas. Reg. §
1.401(a)(9)-9, or
b the period determined under Treas. Reg. §1.401(a)(9)-5 which
satisfies the minimum distribution incidental death benefit requirement of Code
Section 401(a)(9)(G);
provided, however, if such Participant fails to make such an election, his Accounts shall be
distributed as provided in paragraph (i).
(c) Distribution under subsection (a) or (b) shall be made or commence not later than
the earliest to occur of
(i) sixty days after the end of the Plan Year in which such Normal Retirement occurs,
or
(ii) if he is not a five percent owner (as defined in Code Section 416) of the Company
or a Company Affiliate with respect to the Plan Year ending in the calendar year in which he
attains age 70 1/2, the later of
a the April 1 following the calendar year in which his Separation from
Service occurs, or
48
b the April 1 following the calendar year in which he attains age 70 1/2,
or
(iii) if he is such an owner, the April 1 following the calendar year in which he
attains age 70 1/2,
except as provided in subsection (d).
(d) At any time before distribution under subsection (b) is made or commences, the
Participant or Merged Participant may elect to defer such distribution until such later
date as he shall then or subsequently specify; provided, however,
(i) such date shall be no later than the date referred to in paragraph (c)(ii) or
(c)(iii), and
(ii) if no such date is specified, such amount shall be distributed in one lump sum on
the date specified in paragraph (c)(ii) or (c)(iii).
(e) Notwithstanding paragraphs (d)(i) and (d)(ii), for a Participant or Merged
Participant who is a five percent owner (as defined in Code Section 416) of the Company or
a Company Affiliate and has made an election permitted under Code Section 242(b) of the Tax
Equity and Fiscal Responsibility Act of 1982, the date referred to in paragraph (c)(iii)
shall be the later of the April 1 following the calendar year in which his Separation from
the Service occurs or the April 1 following the calendar year in which he attains age 70
1/2.
(f) A five percent owner (as defined in Code Section 416) of the Company or a Company
Affiliate described in Section 10.3(a) or a Participant or Merged Participant described in
Section 10.3(b) or (c) may elect to receive the required minimum distribution for each year
until his retirement as determined under Treas. Reg. Section 1.401(a)(9).
(g) Each Participant, former Participant or Merged Participant shall make a separate
distribution or transfer election under Section I11.3 of Supplement I with respect to his SHARE
Account in accordance with the Rules of the Plan.
Section 11.4. - Distribution Requirements
(a) Subsections (b) and (c) shall apply to distributions under Articles XI, XII and
XIII.
(b) Each Participants, former Participants or Merged Participants Accounts will be
distributed in a manner which satisfies Code Section 401(a)(9) and the regulations
thereunder including the incidental death requirement of Code Section 401(a)(9)(G) all of
which shall take precedence over any inconsistent provisions of the Plan. Code Section
401(a)(9) provides the following requirements:
(i) A Participants, former Participants or Merged Participants total Vested Account
balance shall be distributed or begin to be distributed no later than the Participants
required beginning date as set forth in paragraphs 11.3(c)(ii) and (iii) and shall
49
be paid over a period not extending beyond the life expectancy of such Participant or
the joint life expectancy of the Participant and his Beneficiary.
(ii) If payments have commenced prior to the Participants, former Participants or
Merged Participants death, payment of the Participants Accounts shall be made in such
manner that the remaining interest after his death is distributed at least as rapidly as
under the method being used as of the date of the Participants death.
(iii) If a Participant, former Participant or Merged Participant dies before
distributions begin, his total vested Account balance shall be distributed by December 31 of
the calendar year containing the fifth anniversary of the Participants death unless
paragraph (iv) applies.
(iv) If any portion of a Participants, former Participants or Merged Participants
Account balance is payable over the life of his Beneficiary, such distribution shall begin
no later than December 31 of the calendar year immediately following the calendar year of
the Participants death provided, however, if any portion of the Participants, former
Participants or Merged Participants Account balance is payable over the life of his
Surviving Spouse, such distributions shall begin by December 31 of the calendar year
immediately following the calendar year in which the Participant died, or by December 31 of
the calendar year in which the Participant would have attained age 701/2, if later.
(c) (i) In accordance with paragraph (iii) below, each Participant, former Participant
or Merged Participant shall be entitled to elect to commence distribution of his ESOP
Account not later than one year after the close of the Plan Year
A in which the Participant separates from service by reason of
his attainment of Normal Retirement Date, Disability Retirement or death or
B which is the fifth Plan Year following the Plan Year in which
the Participant otherwise separates from service, except that this clause
shall not apply if the Participant is reemployed by the Company before
distribution is required to begin under this clause.
(ii) Unless the Participant elects otherwise, the distribution of the
Participants ESOP Account will be in substantially equal periodic payments (not
less frequently than annually) over a period not longer than the greater of 5 years
or, in the case of a Participant with an account balance in excess of $800,000, 5
years plus 1 additional year (but nor more than 5 additional years) for each
$160,000 or fraction thereof by which such balance exceeds $800,000.
(iii) This subsection (c) shall not apply until the close of the Plan Year in
which the loan (described in Code Section 404(a)(9)) to acquire Company Stock is
repaid in full.
(d) Notwithstanding subsection (b), a Participant or Beneficiary who would have been
required to receive required minimum distributions for 2009 but for the
50
enactment of Code Section 401(a)(9)(H) (2009 RMDs) and who would have satisfied that
requirement by receiving distributions that are
(i) equal to the 2009 RMDs, or
(ii) one or more payments in a series of substantially equal distributions (that
include the 2009 RMDs) made at least annually and expected to last for the life (or life
expectancy) of the participant, the joint lives (or joint life expectancy) of the
Participant and the Participants designated Beneficiary, or for at least 10 years,
shall not receive those distributions for 2009 unless the Participant or Beneficiary chooses to
receive such distributions. Participants and Beneficiaries described in the preceding sentence
shall be given the opportunity to elect to receive the distributions described in the preceding
sentence. As described in Section 1.29(d), if a Participant or Beneficiary receives a 2009 RMD, it
shall be treated as an Eligible Rollover Distribution.
ARTICLE XII.
BENEFITS UPON DEATH
Section 12.1. - Designation of Beneficiary
(a) Each Participant, former Participant and Merged Participant shall have the right
to designate, revoke and redesignate Beneficiaries hereunder and to direct payment of the
Vested amount credited to his Accounts to such Beneficiaries.
(b) Designation, revocation and redesignation of Beneficiaries must be made in writing
in accordance with the Rules of the Plan on a form provided by the Administrator and shall
be effective upon delivery to the Administrator.
(c) A married Participant, former Participant or Merged Participant may not designate
any Beneficiary other than his Spouse without obtaining Spousal Consent thereto.
(d) Upon the dissolution of marriage of a Participant, former Participant or Merged
Participant, any designation of the Participants former spouse as a Beneficiary shall be
treated as though the Participants former spouse had predeceased the Participant unless
(i) the Participant executes another Beneficiary designation that complies with this
Section and the Rules of the Plan and clearly names such former spouse as a Beneficiary
following such dissolution, or
(ii) a Qualified Domestic Relations Order presented to the Administrator prior to
distribution being made on behalf of the Participant explicitly requires the Participant to
maintain the former spouse as the Beneficiary.
In any case in which the Participants former spouse is treated under the Participants Beneficiary
designation as having predeceased the Participant, no heirs or other beneficiaries of the former
spouse who are not also heirs or beneficiaries of the Participant shall receive benefits from the
Plan
51
as a Beneficiary of the Participant except as provided otherwise in the Participants Beneficiary
designation.
Section 12.2. - Distribution on Death
(a) Subject to Sections 12.3 and 15.17 (if applicable), upon the death of a
Participant, former Participant or Merged Participant, the Vested amount credited to his
Accounts (including the Vested value of shares credited to his Stock Accounts, if any) (as
determined under Section 9.1), shall be paid in one lump sum (in the form of cash or stock
to the extent permitted by Section 11.3(b)(i)) not later than ninety days following such
Participants death (or such longer reasonable period as is permitted under Treas. Reg.
§1.401(a)-20 A-3(b)(1)) to his then Surviving Spouse, if any, except to the extent to which
such Surviving Spouse has consented under Section 12.1(c) to the designation of other
Beneficiaries, and otherwise (such as if such Participant had not designated a Beneficiary
before his death), to the person or persons of highest priority who survives such
Participant by at least thirty days determined as follows:
(i) First, to his then surviving highest priority Beneficiary or Beneficiaries, if any.
(ii) Second, to his then surviving heirs at law, if any, as determined in the
reasonable judgment of the Administrator under the laws governing succession to personal
property of the last jurisdiction in which such Participant was a resident.
(iii) Third, the Plan to be applied to reduce the Companys contribution under Section
6.9 and/or to pay reasonable administrative expenses of the Plan.
(b) Members of a class shall cease to be entitled to benefits upon the earlier of the
Administrators determination that no members of such class exist or the Administrators
failure to locate any members of such class, after making reasonable efforts to do so,
within one year after the members of that class became entitled to benefits hereunder had
members existed.
(c) If payment has commenced prior to the Participants, former Participants or
Merged Participants death, payment of such Participants Accounts shall be made in such
manner that the remaining interest is distributed at least as rapidly as under the method
being used as of the date of such Participants death.
(d) Each Beneficiary shall make a separate distribution or transfer election (if applicable)
with respect to the deceased Participants SHARE Account in accordance with Sections I12.2 and
I12.3 of Supplement I and the Rules of the Plan.
Section 12.3. - Election of Other Payment Methods
(a) Subject to subsection (c), but notwithstanding any other provision of this Article
and in lieu of the lump sum payment otherwise provided for in this Article, if the deceased
Participants Vested Account balance exceeds $5,000 (excluding his Rollover Account to the
extent it consists of rollover contributions described in Code Section 411(a)(11)(D)),
payments under this Article to the Spouse of a Participant, former
52
Participant or Merged Participant shall be made under such option available under
Section 11.3 as such Spouse shall designate.
(b) Subject to subsection (c), but notwithstanding any other provision of this
Article, a Participant, former Participant or Merged Participant may elect on the form
provided by the Administrator for Beneficiary designations that, in lieu of the lump sum
payment otherwise provided for in this Article payments under this Article to his
Beneficiary shall be made under such option available under Section 11.3 as such
Participant shall designate in such form provided that upon the Participants death, his
Vested Account balance exceeds $5,000 (excluding his Rollover Account to the extent it
consists of rollover contributions described in Code Section 411(a)(11)(D)). If a
Beneficiary receiving installment payments under this Section dies, the balance then due
shall be paid in cash in one lump sum to the then surviving person with highest priority
under Section 12.2(a).
(c) If a Participant, former Participant or Merged Participant dies before
distribution of his Accounts commences, then
(i) such Accounts must be distributed within five years of the Participants, former
Participants or Merged Participants death, or
(ii) if any portion of such Accounts is payable to or for the benefit of a Beneficiary,
such portion shall be distributed over the life or the life expectancy of such Beneficiary
with distributions commencing
a within one year of such Participants death, or,
b if the Beneficiary is such Participants Spouse, no later than the
date on which the Participant or Merged Participant would have attained age seventy
and one half (but if such Spouse dies before distributions to such Spouse commence,
then such Spouse shall be treated as the Participant for purposes of this Section
12.3(c)), or
c on such other date as is allowed by law.
ARTICLE XIII.
BENEFITS UPON RESIGNATION OR DISCHARGE
Section 13.1. - Distributions on Resignation or Discharge
(a) Subject to Section 15.17, a Participant or Merged Participant who has a Separation
from the Service due to resignation or discharge shall receive,
(i) if the Vested amount credited to his Accounts (including the Vested value of shares
credited to his Stock Accounts, if any and including any Accounts described in any
applicable Supplement) does not exceed $1,000 (excluding his Rollover Account to the extent
it consists of rollover contributions described in Code Section 411(a)(11)(D)), such amount
in one lump sum (in the form of cash, the Participants promissory note under Section 15.14
and/or stock to the extent permitted by Section
53
11.3(b)(i)) not later than six months after the end of the Plan Year in which such
Separation from the Service occurs, or, if earlier, within sixty days after the end of the
Plan Year in which his fifty-fifth birthday occurs, or
(ii) if the Vested amount credited to his Accounts (including the Vested value of shares credited to his Stock Accounts, if any and including any Accounts described in any
applicable Supplement) exceeds $1,000 (excluding his Rollover Account to the extent it
consists of rollover contributions described in Code Section 411(a)(11)(D)), he shall
receive such amount as described in subparagraph (ii)a or, if he has attained age 55
of the time of his Separation from the Service and so elects, he shall receive such amount
as described in subparagraph (ii)b (except that any Participant promissory note
under Section 15.14 shall be distributed in kind):
a Payment of such amount in one cash lump sum (except that at the
option of such Participant his Stock Accounts, if any, and the portion of his
Accounts invested in the Company Stock Fund will be paid in the form of Company
Stock).
b Payment of such amount directly from the Trust Fund (as adjusted for
gains and losses), in uniform annual or more frequent installments of at least $100
(as to which such Participant (or his Spouse, if applicable) may elect whether the
recalculation rule of Code Section 401(a)(9)(D) shall apply and provided, however,
that the first installment may be larger than the remaining installments) to such
Participant over a period not longer than the lesser of
1 the joint and last survivor expectancy of him and his Spouse,
if any, reasonably determined from the expected return multiples prescribed
in Treas. Reg. § 1.401(a)(9)-9, or
2 the period determined under Treas. Reg. §1.401(a)(9)-5 which
satisfies the minimum distribution incidental death benefit requirement of
Code Section 401(a)(9)(G);
with such distribution being made or commencing no later than April 1 following the calendar
year in which he attains age 701/2.
(b) Each Participant or Merged Participant shall make a separate distribution or
transfer election (if applicable) under Section I13.1 of Supplement I with respect to his
SHARE Account in accordance with the Rules of the Plan.
Section 13.2. - Forfeitures
(a) If a Participant has a Separation from the Service due to resignation or
discharge, the portions of his ESOP Account which are not Vested shall be forfeited upon
the earlier of his receipt of his distribution under this Article or his completion of five
consecutive Break in Service Years. Pending application under Section 6.9, forfeitures
shall be held in suspense and shall not be commingled with amounts held in suspense under
Section 18.4.
54
(b) If a Participant has a Separation from the Service prior to becoming
Vested in any portion of his ESOP Account under Section 9.1, a distribution shall be deemed
to have occurred upon such Separation from the Service for purposes of subsection (a).
Section 13.3. Restoration of Forfeitures
If a Participant whose ESOP Account is not then fully Vested
(a) has a Separation from the Service,
(b) suffers a forfeiture under Section 13.2 of the portion of such Account which is not
Vested,
(c) again becomes an Employee or employed by a Company Affiliate before he has five
consecutive Break in Service Years, and
(d) repays to the Plan the full amount, if any, distributed to him from such Accounts
before the end of his fifth consecutive Break in Service Year or, if earlier, the fifth
anniversary of his reemployment,
then the amount forfeited under Section 13.2 by such Participant and any interest thereon shall be
restored to his ESOP Account, applying forfeitures pending application under Section 6.9 and
Company contributions, in that order, as necessary.
ARTICLE XIV.
TOP-HEAVY PROVISIONS
Section 14.1. Top-Heavy Determination
(a) Solely in the event that this Plan ever becomes Top-Heavy, as defined herein, the
provisions of this Article shall apply.
(b) Solely for the purposes of this Article, the following definitions shall be used:
(i) Aggregation Group shall mean
a each plan of the Company or a Company Affiliate in which a Key
Employee is a Participant (including any such plan which has been terminated if such
plan was maintained by the Company or a Company Affiliate during the Plan Year
ending on the Determination Date for the Plan Year in question) but excluding a plan
meeting the requirements of Code Section 401(k)(11); provided, however, that such
plan allows only contributions required under Code Section 401(k)(11) and
b each other plan of the Company or a Company Affiliate which enables
any plan described in paragraph a to meet the requirements of Code Section
401(a)(4) or 410.
55
(ii) Determination Date shall mean, with respect to any Plan Year, the last day of
the preceding Plan Year, or in the case of the first Plan Year, the last day of such Plan
Year.
(iii) Controlled Group Employee shall mean any person who renders services to the
Company or a Company Affiliate in the status of an employee as the term is defined in Code
Section 3121(d).
(iv) Key Employee shall mean a Controlled Group Employee, a former Controlled Group
Employee or the Beneficiary of a former Controlled Group Employee, if, in the Plan Year
containing the Determination Date, such Controlled Group Employee or former Controlled Group
Employee is or was
a an officer of the Company or a Company Affiliate whose Statutory
Compensation for the Plan Year in question exceeds $130,000 (adjusted as described
in Code Section 415(d)) (not more than fifty Controlled Group Employees or, if less,
the greater of three Controlled Group Employees or ten percent of the Controlled
Group Employees shall be treated as officers),
b a five percent owner (within the meaning of Code Section 416(i)(1)(B)
and (C)) of the Company or a Company Affiliate, or
c a one percent owner (within the meaning of Code Section
416(i)(1)(B)(ii)) of the Company or a Company Affiliate whose Statutory Compensation
for the Plan Year in question exceeds $150,000.
(v) Non-Key Employee shall mean any Controlled Group Employee who is not a Key
Employee.
(vi) The Plan shall not be Top Heavy for any Plan Year in which the Plan consists
solely of a cash or deferred arrangement which meets the requirements of Code Section
401(k)(12) and matching contributions with respect to which the requirements of Code Section
401(m)(11) are satisfied. Subject to the foregoing, the Plan shall be Top-Heavy if, as of
any Determination Date, the aggregate of the Accounts of Key Employees under all plans in
the Aggregation Group (or under this Plan and such other plans as the Company elects to take
into account under Code Section 416(g)(2)(A)(ii)) exceeds sixty percent of the aggregate of
the Accounts for all Key Employees and Non-Key Employees. In making this calculation as of
a Determination Date,
a each Account balance as of the most recent valuation date
occurring within the Plan Year which includes the Determination Date shall
be determined,
b an adjustment for contributions due as of the Determination
Date shall be determined,
c the Account balance of any Controlled Group Employee or
former Controlled Group Employee shall be increased by the aggregate
distributions made as a result of such Controlled Group
56
Employees Separation from the Service (including his severance from
employment) during the one-year period ending on the Determination Date;
provided, however, if any distribution is made to a Controlled Group
Employee for any other reason, such Employees Account balance shall be
increased by the aggregate of such distributions during the five-year period
ending on the Determination Date,
d the Account balance of
1 any Non-Key Employee who was a Key Employee for any
prior Plan Year, and
2 any former Controlled Group Employee who performed no
services for the Company or a Company Affiliate during the one-year
period ending on the Determination Date,
shall be ignored, and
e if there have been any rollovers to or from any Account, the
balance of such Account shall be adjusted, as required by Code Section
416(g)(4)(A).
Notwithstanding the foregoing, this Plan shall be Top-Heavy if, as of any Determination Date, it is
required by Code Section 416(g) to be included in an Aggregation Group which is determined to be a
Top-Heavy Group.
(vii) Top-Heavy Group shall mean any Aggregation Group if, as of the Determination
Date, the sum of
a the present value of the cumulative accrued benefits for all Key
Employees under all defined benefit plans in such Aggregation Group, and
b the aggregate of the accounts of all Key Employees under all defined
contribution plans in such Aggregation Group
exceeds sixty percent of a similar sum determined for all Key Employees and Non-Key
Employees.
(viii) Statutory Compensation shall have the meaning set forth in Code Section
414(q)(4) for purposes of paragraph (b)(iv).
Section 14.2. Minimum Benefits
(a) For any Plan Year in which the Plan is Top-Heavy, the sum of the allocations to
the ESOP Account and the PTS Account of any Employee who is a Non-Key Employee at the end
of such Plan Year and is entitled to an allocation to such Accounts under Section 6.3 shall
not be less than that determined under subsection (b).
57
(b) The allocation determined under this subsection shall be a percentage of the
Statutory Compensation of such Non-Key Employee which is not less than the lesser of
(i) three percent, or
(ii) that percentage reflecting the ratio of
A the allocations under Section 6.3 to
B Statutory Compensation (not in excess of the limit in effect under
Code Section 401(a)(17) as adjusted for increases in the cost of living)
for the Key Employee with respect to whom such ratio is highest for such Plan Year. See also
Section 14.1(b)(viii).
(c) For purposes of determining the minimum contribution under subsection (b), the
following contributions shall be included:
(i) contributions under any plan in the Aggregation Group to the maximum extent
permitted by Code Section 416(g)(4)(H),
(ii) contributions to PTS Accounts (including elective deferrals under a plan in the
Aggregation Group) on behalf of Key Employees, and
(iii) contributions to ESOP Accounts (including any matching contributions as defined
in Code Section 401(m)(4)(A) under a plan in the Aggregation Group).
Section 14.3. Vesting
(a) For any Plan Year in which the Plan is Top-Heavy, the Vested percentage of the
ESOP Account of each Participant or Merged Participant who completes an Hour of Service in
such Plan Year shall be the percentage of such Account shown on the following table:
|
|
|
|
|
Years of Vesting Service |
|
Vested Percentage |
1 (or less)
|
|
|
0 |
% |
2
|
|
|
20 |
% |
3
|
|
|
100 |
% |
(b) The Vested percentage of a Participants ESOP Account shall be not less than the
Vested percentage determined as of the last day of the last Plan Year in which the Plan was
Top-Heavy.
58
(c) For any Plan Year in which the Plan is not Top-Heavy which follows one or more
Plan Years for which the Plan has been Top-Heavy, Section 9.1 shall again become applicable
as an amendment to the Plan; thus, each Participant or Merged Participant who has had his
Vested percentage computed under subsection (a) and who has completed at least one Year of
Vesting Service shall be permitted to elect to have his Vested percentage computed in
accordance with subsection (a) for such Plan Year and any subsequent Plan Year in which the
Plan is no longer Top-Heavy. Such Participant or Merged Participant may make such election
within an election period beginning no later than the first day of the first Plan Year in
which the Plan is no longer Top-Heavy and ending no later than the later of
(i) the sixtieth day of such Plan Year, or
(ii) a date which is sixty days after the day such Participant is issued written notice
of his right to make such election by the Administrator.
ARTICLE XV.
ADMINISTRATIVE PROVISIONS
Section 15.1. Duties and Powers of the Administrator
(a) The Administrator shall administer the Plan in accordance with the Plan and ERISA
and shall have full discretionary power and authority:
(i) To engage actuaries, attorneys, accountants, appraisers, brokers, consultants,
administrators, physicians or other firms or persons and (with its officers, directors and
Employees) to rely upon the reports, advice, opinions or valuations of any such persons
except as required by law;
(ii) To adopt Rules of the Plan that are not inconsistent with the Plan or applicable
law and to amend or revoke any such rules;
(iii) To construe the Plan and the Rules of the Plan;
(iv) To determine questions of eligibility of Participants and the entitlement to
distributions of Participants, former Participants, Merged Participants, Beneficiaries and
all other persons;
(v) To determine entitlement to allocations of contributions and forfeitures of
Participants, Merged Participants, former Participants, Beneficiaries, and all other
persons;
(vi) To make findings of fact as necessary to make any determinations and decisions in
the exercise of such discretionary power and authority;
(vii) To appoint claims and review officials to conduct claims procedures as provided
in Section 15.6; and
59
(viii) To delegate any power or duty to any firm or person engaged under paragraph (i)
or to any other person or persons.
(b) Every finding, decision, and determination made by the Administrator shall, to the
full extent permitted by law, be final and binding upon all parties, except to the extent
found by a court of competent jurisdiction to constitute an abuse of discretion.
Section 15.2. Expenses of Administration
(a) The Company shall indemnify and hold each Employee functioning under Section
15.1(a) or person serving on an investment committee established in accordance with the
Trust Agreement harmless from all claims, liabilities and costs (including reasonable
attorneys fees) arising out of the good faith performance of his functions hereunder.
(b) The Company may obtain and provide for any such Employee and investment committee
member described in subsection (a), at the Companys expense, liability insurance against
liabilities imposed on him by law.
(c) The Plan shall pay reasonable administrative expenses of the Plan, including, but
not limited to, expenses of any such Employee and investment committee member described in
subsection (a) and legal fees incurred for services related to the administration of the
Plan (including the amending of the Plan); provided, however, that the Company may elect,
in its sole and absolute discretion, to pay such administrative expenses from its own
assets.
(d) Notwithstanding subsection (c), reasonable administrative fees incurred by the Plan in
conjunction with Participant loans, withdrawals, distributions and the evaluation of the qualified
status of a domestic relations order, as defined in Code Section 414(p), may be charged to the
Accounts of the Participant in question in accordance with the Rules of the Plan.
Section 15.3. Payments
In the event any amount becomes payable under the Plan to a minor or a person who, in the sole
judgment of the Administrator, is considered by reason of physical or mental condition to be unable
to give a valid receipt therefor, the Administrator may direct that such payment be made to any
person found by the Administrator, in its sole judgment, to have assumed the care of such minor or
other person. Any payment made pursuant to such determination shall constitute a full release and
discharge of the Trustee, the Administrator and the Company and their officers, directors,
employees, owners, agents and representatives.
Section 15.4. Statement to Participants
In accordance with the requirements set forth in ERISA Section 105(a)(1)(A), as of the end of
each Plan Year quarter, each Participant (including an alternate payee under a qualified domestic
relations order which assigns a portion of the Participants Account balance to the alternate payee
or a Beneficiary of a deceased Participant who is eligible to receive the deceased Participants
Accounts) shall be provided with a statement reflecting the balances of his Accounts and such other
information required by ERISA Section 105.
60
Section 15.5. Inspection of Records
Copies of the Plan and any other documents and records which a Participant or Merged
Participant is entitled by law to inspect shall be open to inspection by such Participant or Merged
Participant or such Participants or Merged Participants duly authorized representatives at any
reasonable business hour at the principal office of the Company, any Company work site at which at
least fifty Employees regularly perform services and such other locations as the Secretary of Labor
may require.
Section 15.6. Claims Procedure
(a) A claim by a Participant, former Participant, Merged Participant, Beneficiary or
any other person shall be presented to the claims official appointed by the Administrator
in writing within the maximum time permitted by law or under the regulations promulgated by
the Secretary of Labor or his delegate pertaining to claims procedures.
(b) The claims official shall, within a reasonable time, consider the claim and shall
issue his determination thereon in writing.
(c) If the claim is granted, the appropriate distribution or payment shall be made
from the Trust Fund or by the Company.
(d) If the claim is wholly or partially denied, the claims official shall, within
ninety days (or such longer period as may be reasonably necessary), provide the claimant
with written notice of such denial, setting forth, in a manner calculated to be understood
by the claimant
(i) the specific reason or reasons for such denial,
(ii) specific references to pertinent Plan provisions on which the denial is 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 Plans claim review procedure.
(e) The Administrator shall provide each claimant with a reasonable opportunity to
appeal the claims officials denial of a claim to a review official (appointed by the
Administrator in writing) for a full and fair review. The claimant or his duly authorized
representative
(i) may request a review upon written application to the review official (which shall
be filed with it),
(ii) may review pertinent documents, and
(iii) may submit issues and comments in writing.
61
(f) The review official may establish such time limits within which a claimant may
request review of a denied claim as are reasonable in relation to the nature of the benefit
which is the subject of the claim and to other attendant circumstances but which, in no
event, shall be less than sixty days after receipt by the claimant of written notice of
denial of his claim.
(g) The decision by the review official upon review of a claim shall be made not later
than sixty days after his receipt of the request for review, unless special circumstances
require an extension of time for processing, in which case a decision shall be rendered as
soon as possible, but not later than one hundred twenty days after receipt of such request
for review.
(h) The decision on review shall be in writing and shall include specific reasons for
the decision written in a manner calculated to be understood by the claimant with specific
references to the pertinent Plan provisions on which the decision is based.
(i) The claims official and the review official shall have full discretionary power
and authority to construe the Plan and the Rules of the Plan, to determine questions of
eligibility, vesting and entitlements and to make findings of fact as under Section 15.1
and, to the extent permitted by law, the decision of the claims official (if no review is
properly requested) or the decision of the review official on review, as the case may be,
shall be final and binding on all parties except to the extent found by a court of
competent jurisdiction to constitute an abuse of discretion.
Section 15.7. Conflicting Claims
If the Administrator is confronted with conflicting claims concerning a Participants former
Participants or Merged Participants Accounts, the Administrator may interplead the claimants in
an action at law, or in an arbitration conducted in accordance with the rules of the American
Arbitration Association, as the Administrator shall elect in its sole discretion, and in either
case, the attorneys fees, expenses and costs reasonably incurred by the Administrator in such
proceeding shall be paid from such Participants Accounts.
Section 15.8. Effect of Delay or Failure to Ascertain Amount Distributable or to
Locate Distributee
(a) If an amount payable under Article XI, XII or XIII cannot be ascertained or the
person to whom it is payable has not been ascertained or located within the stated time
limits and reasonable efforts to do so have been made, then distribution shall be made not
later than sixty days after such amount is determined or such person is ascertained or
located, or as prescribed in subsection (b).
(b) If, within one year after a Participant or Merged Participant has a Separation
from the Service, the Administrator, in the exercise of due diligence, has failed to locate
him (or if such Separation from the Service is by reason of his death, has failed to locate
the person entitled to his Vested Accounts under Section 12.2), his entire distributable
interest in the Plan shall be applied to reduce the Companys contribution under Section
5.1; provided, however, that if such Participant (or in the case of his death, the person
entitled thereto under Section 12.2) makes proper claim therefor under Section 15.6, the
amount so
62
forfeited shall be restored to such Participants Account or Accounts, as the case may
be, applying forfeitures pending application, Company contributions and unallocated
earnings and gains of the Trust Fund, in that order, as necessary.
Section 15.9. Service of Process
The Secretary of Avery Dennison Corporation is hereby designated as agent of the Plan for the
service of legal process.
Section 15.10. Limitations Upon Powers of the Administrator
The Plan shall not be operated so as to discriminate in favor of Highly Compensated Employees.
The Plan shall be uniformly and consistently interpreted and applied with regard to all
Participants, former Participants and Merged Participants in similar circumstances. The Plan shall
be administered, interpreted and applied fairly and equitably and in accordance with the specified
purposes of the Plan.
Section 15.11. Effect of Administrator Action
Except as provided in Section 15.6, all actions taken and all determinations made by the
Administrator in good faith shall be final and binding upon all Participants, former Participants,
Merged Participants, the Trustee and any person interested in the Plan or Trust Fund.
Section 15.12. Contributions to Rollover Accounts
(a) An Employee may make a contribution to his Rollover Account established by the
Administrator for such purpose if such contribution meets the requirements of this Section
and is in accordance with the Rules of the Plan.
(b) Such contribution will meet the requirements of this Section if
(i) it is made by the Employee to the Trust in cash in a lump sum, and
(ii) the amount contributed by the Employee consists of
a a direct rollover of an Eligible Rollover Distribution from
an Eligible Retirement Plan or
b a distribution consisting entirely of an Eligible Rollover
Distribution from an Eligible Retirement Plan.
(c) In addition, such contribution will meet the requirements of this Section if
(i) the contribution is made within 60 days (or such other period as is
permitted by Code Section 402(c)(3)(B)) following the day on which the Eligible
Employee received the distribution from the Eligible Retirement Plan described in
subsection (b)(ii)b,
(ii) such distribution was in the form of cash, and
63
(iii) such distribution constituted an Eligible Rollover Distribution within
the meaning of Code Section 402(c)(4).
(d) The Administrator may require the Employee to supply information sufficient to
determine if his contribution meets the requirements of this Section. If the Administrator
determines that such contribution does not meet the requirements of this Section, the
contribution shall not be permitted.
(e) The Plan may also accept the direct transfer from a plan qualified under Code
Section 401(a) of an amount which if paid to the Employee instead of the Plan would have
constituted a lump sum distribution within the meaning of Code Section 402(e). The
transferred amount shall be credited to the Employees Rollover Account.
(f) An Employee who makes a contribution to his Rollover Account pursuant to this
Section prior to the date that he satisfies the eligibility requirements described in
Article II shall generally be treated as a Participant for purposes of the Plan provisions
relating to the maintenance, valuation, investment and distribution of Accounts; provided
however, that such Employee shall not be treated as an Active Participant for purposes of
eligibility to receive an allocation of any Company contributions under the Plan prior to
the date he actually becomes an Active Participant in the Plan.
(g) If the Administrator accepts a contribution or transfer pursuant to this Section
and later determines that it was improper to do so, in whole or in part, the Plan shall
refund the necessary amount to the Employee.
Section 15.13. Transfers to Rollover Accounts
(a) The Administrator may, in its discretion, permit the Plan to accept a direct
transfer from a qualified trust (described in Code Section 401(a)) of a Participants
benefits under such trust. Benefits transferred on behalf of a Participant to the Plan
under this Section shall be credited to such Participants Rollover Account or such other
Accounts of the Participant as are designated by the Administrator.
(b) A plan-to-plan transfer under this Section shall satisfy the requirements of Code
Sections 411(d)(6) and 414(l) and the Treasury Regulations thereunder.
(c) If the Administrator causes the Plan to accept a plan-to-plan transfer pursuant to
this Section and the Administrator later determines that such transfer was improper, in
whole or in part, the Plan shall return to the transferor, or plan the necessary amounts.
Section 15.14. Loans to Participants or Former Participants
(a) A Participant, Merged Participant, former Participant, Spouse or Beneficiary
(Borrower) may borrow against his PTS Account, Qualified Account, ATS Account and/or
other Accounts with the approval of the Administrator in accordance with the provisions of
subsection (b).
64
(b) The Administrator shall establish by Rules of the Plan the requirements for loans
from the Trust Fund and conditions therefor. Such Rules of the Plan shall be consistent
with the following requirements:
(i) The Borrower must be a party in interest within the meaning of ERISA Section
3(14) on the date the loan is made.
(ii) Loans shall not be made available to an individual who is a shareholder-employee
(as defined in Code Section 4975(f)(6)(C)) of the Company or a Company Affiliate or a member
of the family (as defined in Code Section 267(c)(4)) of a shareholder-employee.
(iii) The minimum amount which a Borrower may borrow at any one time under this Section
is $1,000.00.
(iv) The maximum amount which a Borrower may borrow from the Trust Fund shall be an
amount which when added to the outstanding balance of all other loans from the Plan and from
other qualified plans of the Company or a Company Affiliate does not exceed the lesser of
a $50,000 reduced by the excess (if any) of
1 the highest outstanding balance of loans from the Plan during
the one year period ending on the day before the date on which the loan is
made, over
2 the outstanding balance of loans from the Plan on the date on
which such loan was made; or
b half of his Vested interest in all of his Accounts, including any
Accounts maintained for him pursuant to any Supplement.
(v) Loans shall not be made to a Borrower under this Section more frequently than at
six-month intervals. A Borrower may not have more than two loans outstanding at any time.
(vi) Such loans must be available to all Borrowers on a reasonably equivalent basis.
(vii) The Vested percentage of a Borrowers PTS Account, Qualified Account, ATS Account
or other Account which is made available for borrowing shall not be higher for Participants,
Merged Participants or former Participants who are Highly Compensated Employees, officers or
shareholders than for other Borrowers.
(viii) Such loans shall be made upon promissory notes (or such other documents or
communication as authorized by the Administrator) providing for substantially level
amortization (with regular payments by payroll deduction each Payday for a Participant or by
direct payments if the Participant does not have a sufficient paycheck on any Payday). A
Merged Participant, former Participant, Spouse or Beneficiary shall make arrangements for
65
regular direct payments on such loans with the Administrator or its delegate as
provided in the Rules of the Plan.
(ix) Each such loan shall be secured by the lesser of the amount of the loan or half of
the Vested interest in the Borrowers Accounts, including any Accounts maintained for the
Borrower pursuant to any Supplement, and such portion of his Accounts which is credited
after the date of the loan. For purposes of Articles XI, XII and XIII, the distributable
balance of such Accounts shall be reduced by the unpaid balance of the loan secured by such
Accounts.
(x) Each such loan shall bear a reasonable interest rate, which shall be commensurate
with the interest rates charged by persons in the business of lending money for loans which
would be made under similar circumstances. The Administrator may adopt a national or
regional rate of interest for this purpose.
(xi) Each such loan shall be repaid within five years unless the loan is used to
acquire any dwelling unit which within a reasonable time is to be used as a principal
residence of the Borrower.
(xii) The promissory note on any such loan (or such other document or communication
which evidences the loan) shall be an investment of the affected Accounts of the Borrower
receiving such loan and not an investment of the Trust Fund generally.
(xiii) At such time as the Administrator determines in its discretion in a uniform and
nondiscriminatory manner, a Borrower may suspend his installment payments on any loan under
the Plan for a period not longer than one year if the Borrower takes an authorized leave of
absence from the Company, either without pay from the Company or at a rate of pay (after
income and employment tax withholding) that is less than the amount of the installment
payment required under the terms of his Plan loan; provided, however, that the loan must be
repaid by the latest date permitted under Code Section 72(p)(2)(B) and the installments due
after the leave (or, if earlier, after the first year of the leave) must not be less than
those required under the terms of the original loan.
(xiv) At such time as the Administrator determines in its discretion in a uniform and
nondiscriminatory manner, a Borrower who leaves the Company as a result of service in the
uniformed services (as defined in chapter 43 of title 38, United States Code), whether or
not Qualified Military Service as defined in paragraph 6.12(a)(i) may suspend his
installment payments on any loan under the Plan during any part of such service and such
suspension shall not be taken into account for purposes of Code Section 72(p), 401(a), or
4975(d)(1).
(xv) The Administrator shall allow a grace period for a Borrower to make delinquent
installment payments on his loan(s) under the Plan, at such time as the Administrator in its
discretion determines in a uniform and nondiscriminatory manner; provided, however, that the
grace period shall not extend beyond the last day of the calendar quarter following the
calendar quarter in which the required installment payment was due.
66
(xvi) A Participant whose Account contains a promissory note pursuant this Section
15.14 may not elect to receive a distribution of his Accounts under Article XI or XIII after
his Separation from Service until such note has been satisfied or defaulted.
Section 15.15. Distributions Pursuant to Qualified Domestic Relations Orders and
Certain Offsets
(a) Notwithstanding any other provision of the Plan to the contrary except subsection
(b), upon receipt by the Administrator of a domestic relations order, as defined in Code
Section 414(p), which, but for the time of required payment to the alternative payee, would
be a qualified domestic relations order as defined in Code Section 414(p), the amount
awarded to the alternate payee shall promptly be paid in the manner specified in such
order; provided, however, that no such distribution shall be made prior to the
Participants Separation from the Service if such distribution could adversely affect the
qualified status of the Plan.
(b) (i) Notwithstanding subsection (a) or any other provision of the Plan to the
contrary, upon receipt by the Administrator of a judgment, order, decree or settlement
agreement described in paragraph (ii) which expressly provides for an offset against all or
part of an amount ordered or required to be paid to the Plan against a Participants
Accounts under the Plan, such Participants Accounts shall be reduced or offset by the
amount specified in such judgment, order, decree or settlement agreement and such amount
shall promptly be paid to the Plan.
(ii) The judgment, order, decree or settlement agreement described in paragraph (i)
must arise from
a a judgment of conviction for a crime involving the Plan,
b a civil judgment (including a consent order or decree) entered by a
court in an action brought in connection with a violation (or alleged violation) of
Part 4 of ERISA, or
c a settlement agreement between the Secretary of Labor or the Pension
Benefit Guaranty Corporation and the Participant, in connection with a violation (or
alleged violation) of Part 4 of ERISA by a fiduciary or any other person.
Section 15.16. Correction of Administrative Error; Special Contribution
Notwithstanding any other provision of the Plan to the contrary, the Administrator shall take
any and all appropriate actions to correct errors in the administration of the Plan, including,
without limitation, errors in the allocation of contributions, forfeitures, and income, expenses,
gains and losses to the Accounts of the Participants, Merged Participants, former Participants or
Beneficiaries under the Plan. Such corrective actions may include debiting or crediting a
Participants, Merged Participants, former Participants or Beneficiarys Accounts or allocating
special contributions made by the Company to the Plan for purposes of correcting any failure to
make contributions on a timely basis or properly allocate contributions, forfeitures, or income,
expenses, gains and losses. The Administrator shall determine the amount of any such special
contributions required to be made by the Company, which may be made in such approximate amounts as
the Administrator, acting in its sole discretion, shall determine. In no event shall any
67
corrective action taken by the Administrator under this Section reduce any Participants,
Merged Participants, former Participants or Beneficiarys accrued benefit in violation of
Section 411(d)(6) of the Code and the Treasury Regulations thereunder.
Section 15.17. Direct Rollovers
(a) Notwithstanding any provision of the Plan to the contrary, a Distributee may
elect, at the time and in the manner prescribed by the Administrator under the Rules of the
Plan, to have all or any portion of an Eligible Rollover Distribution paid directly to an
Eligible Retirement Plan designated by the Distributee in a Direct Rollover.
(b) If a distribution is one to which Code Sections 401(a)(11) and 417 do not apply,
such distribution may commence less than 30 days after the notice required under Reg.
Section 1.411(a)-11(c) is given, provided that
(i) the Administrator clearly informs the Participant that the Participant has a right
to a period of at least 30 days after receiving the notice to consider the decision of
whether or not to elect a distribution (and, if applicable, a particular distribution
option), and
(ii) the Participant, after receiving the notice, affirmatively elects a distribution.
ARTICLE XVI.
TERMINATION, DISCONTINUANCE,
AMENDMENT, MERGER, ADOPTION OF PLAN
Section 16.1. Termination of Plan; Discontinuance of Contributions
(a) The Plan is intended as a permanent program but the Board shall have the right at any time
to declare the Plan terminated completely as to the Company or as to any division, facility or
other operational unit thereof. Discharge or layoff of Employees of the Company or any unit thereof
without such a declaration shall not result in a termination or partial termination of the Plan
except to the extent required by law. In the event of any termination or partial termination:
(i) An allocation of amounts being held under Section 18.4(b) shall be made in
accordance with Section 18.4(c).
(ii) For each Participant or Merged Participant who is then an Employee or employed by
a Company Affiliate with respect to whom the Plan is terminated, the interest in his ESOP
Account, if any, including his interest in the forfeitures (which shall be applied under
Section 6.9), shall become fully Vested.
(iii) The Administrator shall direct the Trustee to liquidate the necessary portion of
the Trust Fund and distribute it, less a proportionate share of the expenses of termination,
to the persons entitled thereto in proportion to their Accounts.
(iv) Provided that the Company or a Company Affiliate does not maintain another defined
contribution plan other than an employee stock ownership plan (as defined in Code
Section 4975(e)(7)), such distributions shall be made in the manner prescribed by
68
Section 13.1(a), assuming for such purpose that each person entitled to a distribution
under the Plan is a Participant or Merged Participant who has had a Separation from the
Service due to resignation or discharge on the date of termination.
(b) [Reserved.]
Section 16.2. Amendment of Plan
As limited in Section 16.1 of the Plan and Section 7.02 of the Trust Agreement, complete or
partial amendments or modifications to the Plan (including retroactive amendments to meet
governmental requirements or prerequisites for tax qualification) may be made from time to time by
Avery Dennison Corporation; provided, however, that no amendment shall decrease the Vested
percentage of any Participant, former Participant or Merged Participant has in his Accounts or his
accrued benefit. Amendments shall be adopted by the Board; provided, however, that the chief
executive officer of Avery Dennison Corporation may adopt amendments as necessary to bring the Plan
into conformity with legal requirements or to improve the administration of the Plan, provided that
no such amendment involves an increase in cost of benefits provided by the Plan.
Section 16.3. Retroactive Effect of Plan Amendment
(a) No Plan amendment, including this amendment, unless it expressly provides
otherwise, shall be applied retroactively to increase the Vested percentage of a
Participant or Merged Participant whose Separation from the Service preceded the date such
amendment became effective unless and until he becomes or again becomes a Participant and
additional contributions are allocated to him.
(b) No Plan amendment, unless it expressly provides otherwise, shall be applied
retroactively to increase the amount of service credited to any person for purposes of Plan
participation, vesting or any other Plan purpose with respect to his participation or
employment before the date such amendment became effective.
(c) Except as provided in subsections (a) and (b), all rights under the Plan shall be
determined under the terms of the Plan as in effect at the time the determination is made.
Section 16.4. Consolidation or Merger; Adoption of Plan by Other Companies
(a) In the event of the consolidation or merger of the Company with or into any other
business entity, or the sale by the Company or its owner of its assets, the successor may
continue the Plan by adopting the same by resolution of its board of directors or agreement
of its partners or proprietor and, if deemed appropriate, by executing a proper
supplemental agreement to the Trust Agreement with the Trustee. If, within ninety days
from the effective date of such consolidation, merger or sale of assets, such new
corporation, partnership or proprietorship does not adopt the Plan, the Plan shall be
terminated in accordance with Section 16.1. If a Company ceases to be a Company Affiliate
then, as of the date of the change in the controlled group, the employees of such entity
shall cease to be eligible to participate in the Plan.
69
(b) The Plan shall not be merged or consolidated with any other plan, nor shall its
assets or liabilities be transferred to any other plan, unless each Participant, Merged
Participant or former Participant in this Plan would have immediately after the merger,
consolidation or transfer (if the plan in question were then terminated) accounts which are
equal to or greater in amount than his corresponding Accounts under this Plan had the Plan
been terminated immediately before the merger, consolidation or transfer.
(c) Any Company Affiliate may, with the approval of the Board or its delegate, adopt
the Plan as a whole company or as to any one or more divisions in accordance with the Rules
of the Plan.
ARTICLE XVII.
SALE OF COMPANY STOCK
Section 17.1. Option to Sell Shares of Company Stock
Solely in the event that a Participant, former Participant or Merged Participant receives a
distribution consisting in whole or in part of Company Stock that at the time of distribution
thereof is not publicly traded, then such distributed Company Stock shall be made subject to a put
option in the hands of a Qualified Holder, with such put option to be subject to the following
provisions:
(a) During the sixty day period following any distribution of such Company Stock, a
Qualified Holder shall have the right to require the Company to purchase all or any portion
of said distributed Company Stock held by said Qualified Holder. A Qualified Holder shall
exercise such right by giving written notice, within the aforesaid sixty day period, to the
Company of the number of shares of distributed Company Stock that such Qualified Holder
intends to sell to the Company. The purchase price to be paid for any such Company Stock
shall be its fair market value determined as of the most recent valuation in accordance
with the valuation rules specified in Section 8.1.
(b) If a Qualified Holder shall fail to exercise his put option right under subsection
(a), he shall have the right to exercise such option in the first sixty day period of the
next following Plan Year. If a Qualified Holder shall fail to exercise his put option in
the next succeeding Plan Year, such option right shall expire and the Qualified Holder
shall have no further right to require the Company to purchase such distributed Company
Stock.
(c) In the application of subsections (a) and (b), the period during which a put
option is exercisable does not include any time when a distributee is unable to exercise it
because the party bound by the put option is prohibited from honoring it by applicable
federal or state law.
(d) In the event that a Qualified Holder shall exercise a put option under this
Section, then the Company shall have the option of paying the purchase price of the Option
Stock under either of the following methods:
(i) A lump sum payment of the purchase price within ninety days after the date upon
which such put option is exercised (the Exercise Date) or
70
(ii) A series of six or less equal installment payments, with the first such payment to
be made within thirty days after the Exercise Date and the five or correspondingly less
remaining payments to be made on the five or less anniversary dates of the Exercise Date, so
that the full amount shall be paid as of the fifth or earlier anniversary of such Exercise
Date. If the Company elects to pay the purchase price of the Option Stock under the
installment method provided in this paragraph (ii), then the Company shall, within 30 days
after the Exercise Date, give the Qualified Holder who is exercising the put option the
Companys promissory note for the full unpaid balance of the option price. Such note shall,
at a minimum, state a reasonable rate of interest and provide that the full amount of such
note shall accelerate and become due immediately in the event that the Company defaults in
the payment of a scheduled installment payment.
(e) The protections and rights provided in this Section are nonterminable and continue
to exist notwithstanding the repayment of any loan, the proceeds of which are used to
purchase Leveraged Company Stock and notwithstanding the cessation of the Plans status as
an employee stock ownership plan.
(f) The foregoing put options under subsections (a) and (b) shall be effective solely
against the Company and shall not obligate the Plan in any manner, provided, however, with
the Companys consent the Plan may elect to purchase any Company Stock that otherwise must
be purchased by the Company pursuant to a Qualified Holders exercise of any such option.
(g) Except as is expressly provided hereinabove with respect to any distributed
Leveraged Company Stock that is not publicly traded, no such Leveraged Company Stock shall
be subject to a put, call, or other option, or buy-sell or similar arrangement while held
by and when distributed from the Plan, whether or not at such time the Plan constitutes an
employee stock ownership plan and whether or not the loan used to acquire such Leveraged
Company Stock shall have been repaid.
(h) At the time of distribution of Company Stock that is not publicly traded to an
Employee or Beneficiary, the Company shall furnish to such Employee or Beneficiary the most
recent annual certificate of value prepared by the Company with respect to such stock. In
addition, the Company shall furnish to such Participant, former Participant or Merged
Participant or Beneficiary a copy of each subsequent annual certificate of value until the
put options provided for in this Section with respect to such distributed Company Stock
shall expire.
ARTICLE XVIII.
MISCELLANEOUS PROVISIONS
Section 18.1. Identification of Fiduciaries
(a) The Administrator (with respect to control and management of Plan assets and in
general) and the Trustee shall be named fiduciaries within the meaning of ERISA and, as
permitted or required by law, shall have exclusive authority and discretion to control and
manage the operation and administration of the Plan within the limits set forth in the
Trust Agreement, subject to proper delegation.
71
(b) Such named fiduciaries and every person who exercises any discretionary authority
or discretionary control respecting management of the Trust Fund or Plan, or exercises any
authority or control respecting the management or disposition of the assets of the Trust
Fund or Plan, or renders investment advice for compensation, direct or indirect, with
respect to any monies or other property of the Trust Fund or Plan or has authority or
responsibility to do so, or has any discretionary authority or discretionary responsibility
in the administration of the Plan, and any person designated by a named fiduciary to carry
out fiduciary responsibilities under the Plan, shall be a fiduciary and, as such, shall be
subject to provisions of the Plan, the Trust Agreement, ERISA and other applicable laws
governing fiduciaries. Any person may act in more than one fiduciary capacity.
Section 18.2. Allocation of Fiduciary Responsibilities
(a) Fiduciary responsibilities under the Plan are allocated as follows:
(i) The sole power and discretion to manage and control the Plans assets including,
but not limited to, the power to acquire and dispose of Plan assets, is allocated to the
Trustee, except to the extent that another fiduciary is appointed in accordance with the
Trust Agreement with the power to control or manage (including the power to acquire and
dispose of) assets of the Plan.
(ii) The sole duties, responsibilities and powers allocated to the Board shall be those
expressly retained under Sections 16.1, 16.2 and 16.4.
(iii) The sole duties, responsibilities and powers allocated to the Company shall be
those expressly retained under the Plan or the Trust Agreement.
(iv) Each Participant, former Participant or Merged Participant shall be a named
fiduciary for purposes of Section 403(a) of ERISA but solely with respect to the issuance of
instructions to the Trustee
A to tender or not to tender the Company Stock representing the
proportionate share in the Company Stock Fund and in the Suspense Account of the
Participants Accounts, or the Company Stock credited to his Stock Accounts,
pursuant to Section 1.12 of the Trust Agreement, and
B to vote such shares, pursuant to Section 18.5.
(v) All fiduciary responsibilities not allocated to the Trustee, the Board, the Company
or any investment manager are hereby allocated to the Administrator, subject to delegation
in accordance with Section 15.1(a)(viii).
(b) Fiduciary responsibilities under the Plan (other than the power to manage or
control the Plans assets) may be reallocated among those fiduciaries identified as named
fiduciaries in Section 18.1 by amending the Plan in the manner prescribed in Section 16.2
followed by such fiduciaries acceptance of, or operation under, such amended Plan.
72
Section 18.3. Limitation on Rights of Employees
The Plan is strictly a voluntary undertaking on the part of the Company and shall not
constitute a contract between the Company and any Employee, or consideration for, or an inducement
or condition of, the employment of an Employee. Except as otherwise required by law, nothing
contained in the Plan shall give any Employee the right to be retained in the service of the
Company or to interfere with or restrict the right of the Company, which is hereby expressly
reserved, to discharge or retire any Employee at any time, without notice and with or without
cause. Except as otherwise required by law, inclusion under the Plan will not give any Employee
any right or claim to any benefit hereunder except to the extent such right has specifically become
fixed under the terms of the Plan and there are funds available therefor in the hands of the
Trustee. The doctrine of substantial performance shall have no application to Employees,
Participants or Merged Participants. Each condition and provision, including numerical items, has
been carefully considered and constitutes the minimum limit on performance which will give rise to
the applicable right.
Section 18.4. Limitation on Annual Additions; Treatment of Otherwise Excessive
Allocations
(a) Except as provided in Section 3.1(c), in any Plan Year (which shall be the Plans
limitation year within the meaning of Treas. Reg. Section 1.415(j)-1), the Annual Addition of a
Participant shall not exceed the lesser of
(i) 100 percent of the Participants Statutory Compensation for the Plan Year, or
(ii) $40,000 (as adjusted for increases in the cost of living as described in Code
Section 415(d)).
(b) If the Annual Addition of a Participant would exceed the limits of subsection (a),
corrections shall be made in conformance with the Employee Plans Compliance Resolution System (or
any successor thereto).
Section 18.5. Voting Rights
Except as otherwise required by ERISA, the Code and applicable Treasury Regulations, all
voting rights of shares of Company Stock held in the Trust Fund (including pursuant to any
Supplement) shall be exercised by the Trustee only as directed by the Administrator, the
Participants, former Participants or Merged Participants (as applicable) or their Beneficiaries in
accordance with the following provisions of this Section 18.5:
(a) With respect to all corporate matters submitted to the Companys shareholders,
Company Stock held by the Trust in the Company Stock Fund or Stock Accounts (including
pursuant to any Supplement) shall be voted in accordance with the directions of the
Participants, former Participants and Merged Participants (as communicated to the Trustee)
in proportion to the sum of the value of the investment of their Accounts in the Company
Stock Fund (including pursuant to any Supplement) and the value of the shares allocated to
their Stock Accounts (including pursuant to any Supplement). If this Section 18.5(a)
applies to shares of Company Stock allocated to the account of a deceased Participant,
former Participant or Merged Participant, such
73
Participants Beneficiary shall be entitled to direct the voting with respect to such shares as if such Beneficiary were the Participant, former Participant or Merged
Participant.
(b) At least thirty days before each annual or special shareholders meeting of the
Company (or, if such schedule cannot be met, as early as practicable before such meeting),
the Trustee shall furnish to each Participant, former Participant or Merged Participant a
copy of the proxy solicitation material sent generally to shareholders, together with a
form requesting confidential instructions on how such Participants proportionate voting
rights are to be exercised. Upon timely receipt of such instructions, the Trustee (after
combining votes of fractional shares of Company stock to give effect to the greatest extent
possible to Participants, former Participants or Merged Participants instructions) shall
vote as instructed. The instructions received by the Trustee from Participants, former
Participants or Merged Participants shall be held by the Trustee in strict confidence and
shall not be divulged or released to any person including officers or Employees of the
Company, or of any other company. The Trustee and the Company shall not make
recommendations to Participants, former Participants or Merged Participants on whether to
vote or how to vote, other than recommendations contained in proxy and other materials that
are generally distributed to all shareholders of the Company with respect to such vote. If
voting instructions for shares of Company Stock allocated to any Participant, former
Participant or Merged Participant are not timely received for a particular shareholders
meeting, such shares of Company Stock shall not be voted.
(c) The Trustee shall vote shares of Company Stock allocated to the Suspense Account
(or held by the Trust but not otherwise described in subsection (a)) in the same proportion
as Company Stock with respect to which voting instructions are received is voted.
Section 18.6. Delays in Payment
If any Participant, former Participant or Merged Participant would incur any liability
pursuant to Section 16(b) of the Securities Exchange Act of 1934 by reason of his receipt of any
distribution hereunder, then, notwithstanding any other Plan provision, such Participant, former
Participant or Merged Participant shall have the option to delay such distribution for such
reasonable period of time as shall be necessary to avoid such liability.
Section 18.7. Restriction on Leveraged Company Stock
Except as otherwise provided herein, no Leveraged Company Stock may be subject to a put, call,
or other option or a buy-sell or similar arrangement while held by and when distributed from the
Plan.
Section 18.8. Governing Law
The Plan and Trust shall be interpreted, administered and enforced in accordance with the Code
and ERISA, and the rights of Participants, former Participants, Merged Participants, Beneficiaries
and all other persons shall be determined in accordance therewith; provided, however, that, to the
extent that state law is applicable, the laws of the state of residence of the Participant in
question, or if none, the state in which the principal office of the Administrator is located shall
apply.
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Section 18.9. Genders and Plurals
Where the context so indicates, the masculine pronoun shall include the feminine pronoun and
the singular shall include the plural.
Section 18.10. Titles
Titles are provided herein for convenience only and are not to serve as a basis for
interpretation or construction of the Plan or Trust Agreement.
Section 18.11. References
Unless the context clearly indicates to the contrary, a reference to a statute, regulation or
document shall be construed as referring to any subsequently amended, enacted, adopted or executed
statute, regulation or document.
Executed at Pasadena, California, this 25th day of January, 2007.
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AVERY DENNISON CORPORATION
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By |
/s/ Dean A. Scarborough
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Chief Executive Officer |
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75
SUPPLEMENT A
This Supplement contains provisions which modify and supplement the Plan in order to
effectuate the merger into the Savings Plan of the Employee Stock Ownership Plan of Avery
International effective July 31, 1987. It shall apply only to Merged Participants and those who
are not Merged Participants only because they are Participants.
The profit-sharing portion of the Plan shall include the PAYSOP Accounts.
Section A1.1. Accounts
Accounts of a Participant or Merged Participant shall include his PAYSOP Account.
Section A1.2. ESOP Effective Date
ESOP Effective Date shall be March 1, 1989.
Section A1.3. Merged Participant
Merged Participant shall include a PAYSOP Participant and a Savings Plan Participant.
Section A1.4. PAYSOP
PAYSOP shall mean the Employee Stock Ownership Plan of Avery International which was merged
into the Savings Plan effective July 31, 1987.
Section A1.5. PAYSOP Account
PAYSOP Account shall mean the individual account in the Plan established for a Participant
or Merged Participant as a result of the merger of the PAYSOP into the Savings Plan effective
July 31, 1987 which consists of the contributions of the Company to such Participants Stock
Ownership Account established pursuant to the PAYSOP in accordance with Section 5.1 thereof.
Section A1.6. PAYSOP Participant
PAYSOP Participant shall mean any person who is not a Participant in the Plan and was not a
participant in the Savings Plan, but was a participant in the PAYSOP, for whom the Company
maintains a PAYSOP Account.
Section A1.7. Savings Plan Participant
Savings Plan Participant shall include any person who is not a Participant in the Plan but
was a participant in the Savings Plan and the PAYSOP for whom the Company maintains a PAYSOP
Account and Accounts under the Savings Plan described in Supplement H.
A-1
Section A1.8. Stock Account
A Stock Account of a Participant or Merged Participant shall include his PAYSOP Account.
Section A6.10. Diversification
Except as provided in subsection 6.10(b) of the Plan, this Section shall apply to any Active
Participant.
* * * * *
References in the following Sections of the Plan to Participants shall be deemed to include
Merged Participants:
1.13 (Cash Account), 1.54 (Qualified Holder), 1.65 (Stock Account), 6.4, 6.6, 6.8, 6.10, 8.1, and
18.2.
A-2
SUPPLEMENT B
This Supplement contains provisions which modify and supplement the Plan in order to
effectuate the merger into the Savings Plan of the Profit-Sharing Plan for Employees of White
Graphic Systems, Inc. effective July 31, 1987. It shall apply only to Merged Participants and those
who are not Merged Participants only because they are Participants.
The profit-sharing portion of the Plan shall include the White Graphic Accounts.
Section B1.1. Accounts
Accounts of a Participant or Merged Participant shall include his White Graphic Account.
Section B1.2. Hour of Service
For purposes of Section 1.36, any reference to the Company with respect to periods prior to
August 1, 1987 shall include White Graphic Systems, Inc.
Section B1.3. Merged Participant
Merged Participant shall include a White Graphic Participant and a Savings Plan Participant.
Section B1.4. Savings Plan Participant
Savings Plan Participant shall include any person who is not a Participant in the Plan but
was a participant in the Savings Plan and the White Graphic Plan for whom the Company maintains a
White Graphic Account and Accounts under the Savings Plan described in Supplement H.
Section B1.5. White Graphic Account
White Graphic Account shall mean the individual account in the Plan established for a
Participant or Merged Participant as a result of the merger of the White Graphic Plan into the
Savings Plan effective July 31, 1987.
Section B1.6. White Graphic Participant
White Graphic Participant shall mean any person who is not a Participant in the Plan and was
not a participant in the Savings Plan, but was a Participant in the White Graphic Plan for whom the
Company maintains a White Graphic Account.
Section B1.7. White Graphic Plan
White Graphic Plan shall mean the Profit-Sharing Plan for Employees of White Graphic
Systems, Inc.
B-1
SUPPLEMENT C
This Supplement contains provisions which modify and supplement the Plan in order to
effectuate the merger into the Savings Plan of the Profit-Sharing Plan of Kingsbacher-Murphy
Company effective March 1, 1993. It shall apply only to Merged Participants and those who are not
Merged Participants only because they are Participants.
The profit-sharing portion of the Plan shall include the Kingsbacher-Murphy Accounts.
Section C1.1. Accounts
Accounts of a Participant or Merged Participant shall include his Kingsbacher-Murphy
Account.
Section C1.2. Kingsbacher-Murphy Account
Kingsbacher-Murphy Account shall mean the individual account in the Plan established for a
Participant or Merged Participant as a result of the merger of the Kingsbacher-Murphy Plan into the
Savings Plan effective March 1, 1993, and shall consist of his Kingsbacher-Murphy Rollover Account,
if any, and his Kingsbacher-Murphy Profit-Sharing Account.
Section C1.3. Kingsbacher-Murphy Participant
Kingsbacher-Murphy Participant shall mean any person who is not a Participant in the Plan
and was not a participant in the Savings Plan, but was a Participant in the Kingsbacher-Murphy Plan
for whom the Company maintains a Kingsbacher-Murphy Account.
Section C1.4. Kingsbacher-Murphy Plan
Kingsbacher-Murphy Plan shall mean the Profit-Sharing Plan of Kingsbacher-Murphy Company.
Section C1.5. Kingsbacher-Murphy Profit-Sharing Account
Kingsbacher-Murphy Profit-Sharing Account of a Participant or Merged Participant shall mean
that portion of his Kingsbacher-Murphy Account consisting of contributions to his Profit-Sharing
Account established pursuant to the terms of the Kingsbacher-Murphy Plan.
Section C1.6. Kingsbacher-Murphy Rollover Account
Kingsbacher-Murphy Rollover Account of a Participant or a Merged Participant shall mean that
portion of his Kingsbacher-Murphy Account consisting of contributions to his Rollover Account, if
any, established pursuant to the terms of the Kingsbacher-Murphy Plan.
Section C1.7. Merged Participant
Merged Participant shall include a Kingsbacher-Murphy Participant and a Savings Plan
Participant.
C-1
Section C1.8. Savings Plan Participant
Savings Plan Participant shall include any person who is not a Participant in the Plan but
was a participant in the Savings Plan and the Kingsbacher-Murphy Plan for whom the Company
maintains a Kingsbacher -Murphy Account and Accounts under the Savings Plan described in Supplement
H.
C-2
SUPPLEMENT D
This Supplement contains provisions which modify and supplement the Plan in order to
effectuate the transfer into the Savings Plan of the accounts of certain employees under The
Dennison Manufacturing Company Pre-Tax Investment Plus Plan and The Avery Dennison Office Products
Company Pre-Tax Investment Plus Plan, effective at the close of business May 31, 1993. It shall
apply only to Merged Participants and those who are not Merged Participants only because they are
Participants.
Pursuant to this transfer of accounts, amounts held in the Deferred Compensation Account,
Matching Account, Qualified Account and Rollover Account of each Participant and Merged
Participant under the Dennison 401(k) Plans were transferred to the Unmatched PTS Account, Company
Contributions Account, Qualified Account and Dennison 401(k) Rollover Account, respectively, under
the Savings Plan.
The profit-sharing portion of the Plan shall include the Dennison 401(k) Rollover Accounts.
Section D1.1. Accounts
Accounts of a Participant or Merged Participant shall include his Dennison 401(k) Rollover
Account.
Section D1.2. Dennison 401(k) Participant
Dennison 401(k) Participant shall mean any person who is not a Participant in the Plan and
was not a participant in the Savings Plan, but one or more of whose accounts in one of the Dennison
401(k) Plans was transferred to the Savings Plan.
Section D1.3. Dennison 401(k) Plans
Dennison 401(k) Plans shall mean The Dennison Manufacturing Company Pre-Tax Investment Plus
Plan and The Avery Dennison Office Products Company Pre-Tax Investment Plus Plan.
Section D1.4. Dennison 401(k) Rollover Account
Dennison 401(k) Rollover Account shall mean the individual account in the Plan established
for a Participant or Merged Participant as a result of the transfer of accounts from the Dennison
401(k) Plans to the Savings Plan effective as of May 31, 1993.
Section D1.5. Merged Participant
Merged Participant shall include a Dennison 401(k) Participant and a Savings Plan
Participant.
D-1
Section D1.6. Savings Plan Participant
Savings Plan Participant shall include any person who is not a Participant in the Plan but
was a participant in the Savings Plan and one of the Dennison 401(k) Plans for whom the Company
maintains one or more Accounts which were originally transferred from a Dennison 401(k) Plan to the
Savings Plan as well as Accounts under the Savings Plan described in Supplement H.
Section D9.3. Withdrawals from Dennison 401(k) Rollover Accounts
A Participant or Merged Participant who is an Employee may elect in accordance with the Rules
of the Plan to make a lump sum withdrawal of all or any portion of the amount credited to his
Dennison 401(k) Rollover Account.
Section D9.6. Withdrawals Upon Attainment of Age Fifty Nine and One Half
A Participant or Merged Participant who remains in the employ of the Company after attaining
age fifty-nine and one-half may elect in accordance with the Rules of the Plan to receive a
distribution of all or any portion of his Dennison 401(k) Rollover Account in one lump sum. Such
distributions shall not be made more frequently than at twelve month intervals.
Section D15.14. Loans to Participants and Merged Participants
A Participant or Merged Participant may borrow against his Dennison 401(k) Rollover Account
with the approval of the Administrator in accordance with the provisions of subsection (b).
D-2
SUPPLEMENT E
This Supplement contains provisions which modify and supplement the Plan in order to
effectuate the merger into the Savings Plan of The Dennison Employee Stock Ownership Plan,
effective at the close of business May 31, 1993. It shall apply only to Merged Participants and
those who are not Merged Participants only because they are Participants.
The leveraged ESOP portion of the Plan shall include the Dennison ESOP Accounts.
Section E1.1. Accounts
Accounts of a Participant or Merged Participant shall include his Dennison ESOP Account.
Section E1.2. Change in Control
Change in Control shall mean,
(a) The acquisition (other than from Dennison Manufacturing Company) by any person,
entity or group, within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities
Exchange Act of 1934, as amended (the Exchange Act), (excluding, for this purpose,
Dennison Manufacturing Company or its subsidiaries, or any employee benefit plan of Dennison
Manufacturing Company or its subsidiaries) of beneficial ownership (within the meaning of
Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either the then outstanding shares of common stock of Dennison Manufacturing Company or the combined voting power of the
then outstanding voting securities of Dennison Manufacturing Company entitled to vote
generally in the election of directors of Dennison Manufacturing Company; or
(b) Individuals, who as of January 1, 1990, constitute the Board of Directors of
Dennison Manufacturing Company (as of January 1, 1990, the Incumbent Board) cease for any
reason to constitute at least a majority of the Board of Directors of Dennison Manufacturing
Company, provided that any person becoming a director subsequent to January 1, 1990 whose
election, or nomination for election by the shareholders of Dennison Manufacturing Company,
was approved by a vote of at least a majority of the directors then comprising the Incumbent
Board (other than an election or nomination of an individual whose initial assumption of
office is in connection with an actual or threatened election contest relating to the
election of the directors of Dennison Manufacturing Company, as such terms are sued in Rule
14a-11 of Regulation 14A promulgated under the Exchange Act) shall be, for purposes of the
Plan, considered as though such person were a member of the Incumbent Board; or
(c) Consummation of a reorganization, merger or consolidation, in each case, with
respect to which persons who were the stockholders of Dennison Manufacturing Company
immediately prior to such reorganization, merger or consolidation do not, immediately
thereafter, own, directly or indirectly, more than 50% of the combined voting power entitled
to vote generally in the election of directors of the reorganized, merged or consolidated
companys then outstanding voting securities, or a liquidation or dissolution of
E-1
Dennison Manufacturing Company or of the sale of all or substantially all of the assets of Dennison
Manufacturing Company.
Section E1.3. Dennison ESOP
Dennison ESOP shall mean The Dennison Employee Stock Ownership Plan.
Section E1.4. Dennison ESOP Account
Dennison ESOP Account shall mean the individual account in the Plan established for a
Participant or Merged Participant as a result of the merger of the Dennison ESOP into the Savings
Plan effective May 31, 1993.
Section E1.5. Dennison ESOP Participant
Dennison ESOP Participant shall mean any person who is not a Participant in the Plan and was
not a participant in the Savings Plan, but was a participant in the Dennison ESOP, for whom the
Company maintains a Dennison ESOP Account.
Section E1.7. Leveraged Company Stock
Leveraged Company Stock shall include Company Stock treated as Leveraged Company Stock
under the provisions of the Dennison ESOP as of its merger into the Savings Plan.
Section E1.8. Merged Participant
Merged Participant shall include a Dennison ESOP Participant and a Savings Plan Participant.
Section E1.9. Normal Retirement Date
Normal Retirement Date of a Participant or Merged Participant, but only with respect to his
Dennison ESOP Account, shall mean the first day of the calendar month coincident with or next
following the earlier of
(a) his sixty-fifth birthday, or
(b) his fifty-fifth birthday and his completion of five Years of Vesting Service.
Section E1.10. Savings Plan Participant
Savings Plan Participant shall include any person who is not a Participant in the Plan but
was a participant in the Savings Plan and the Dennison ESOP for whom the Company maintains a
Dennison ESOP Account and Accounts under the Savings Plan described in Supplements H.
E-2
Section E1.11. Stock Account
Stock Account of a Participant or Merged Participant shall include his Dennison ESOP
Account. For purposes of Section E6.10, Stock Account shall mean only that portion of a
Participants Stock Account held in Company Stock.
Section E1.12. Years of Vesting Service
Years of Vesting Service shall include all service treated as Vesting Service under the
provisions of the Dennison ESOP as of May 31, 1993, as well as all service otherwise so treated
under the provisions of the Savings Plan and the Plan.
Section E6.10. Diversification
Except as provided in Section 6.10(a) of the Plan, an Active Participant may elect to have up
to the entire amount credited to his Stock Account applied, pursuant to Article VII and the Rules
of the Plan, to investment in such (three or more) Subfunds as are designated for such purpose
under the Rules of the Plan (and notwithstanding any contrary, otherwise applicable, Rules of the
Plan) or distributed to him. Such elections shall be made on such forms or such other documents or
communications as are prescribed by the Administrator.
Section E9.1. Vesting of Accounts
(a) Except as provided in Section E14.3(a) and subsection (b), a Participants or Merged
Participants Dennison ESOP Account shall not be Vested until he completes three Years of Vesting
Service at which time it shall become fully Vested.
(b) The interest of a Participant or Merged Participant in his Dennison ESOP Account shall
become fully Vested upon the earliest to occur of
(i) it becoming fully Vested under the terms of the Dennison ESOP or the Savings Plan,
(ii) his death,
(iii) his Normal Retirement Date,
(iv) his Disability Retirement Date,
(v) a Change in Control, or
(vi) the termination or discontinuation of the Plan under Section 16.1,
if he is then an affected Employee or employed by a Company Affiliate.
Section E9.6. Withdrawal After Ten Years of Vesting Service
Notwithstanding any contrary provision of the Plan, any Participant or Merged Participant who
has accrued ten or more Years of Vesting Service at the end of any Plan Year may,
E-3
without a
Separation from the Service and during his continued participation in the Plan, elect to receive a
distribution of up to 10% (determined in increments of 1%) of the amount credited to his Dennison
ESOP Account in one lump sum distribution in the form of cash or stock to the extent permitted by
Section 11.3(b)(i) in accordance with Section 11.3(a).
Section E11.3. Distribution of Accounts
(b) If the entire amount credited to a Participants or Merged Participants Accounts exceeds
$1,000 (excluding his Rollover Account to the extent it consists of rollover contributions
described in Code Section 411(a)(11)(D)), such Participant or Merged Participant may elect to
receive the amount credited to his Dennison ESOP Account under any installment option then
available under Section 11.3, except that following commencement of payment, such Participant may
elect to increase the amount of such installments or the frequency of such installments, or both.
Section E12.2. Distribution on Death
(a) Upon the death of a Participant or Merged Participant whose Accounts exceed $5,000, the
person or persons designated under subsection (b) may elect to receive the amount credited to such
Participants Dennison ESOP Account under any installment option then available under Section 11.3,
except that following commencement of payment, such person or persons designated under subsection
(b) may elect to increase the amount of such installments or the frequency of such installments, or
both; provided, however, that such installments shall continue over a period not longer than the
life expectancy of such person.
Section E13.1. Distribution on Resignation or Discharge
(b) if the Vested amount credited to his Accounts exceeds` $1,000 (excluding his Rollover
Account to the extent it consists of rollover contributions described in Code Section
411(a)(11)(D)), payment of his Vested Dennison ESOP Account under any installment option then
available under Section 11.3, except that following commencement of payment, such Participant may
elect to increase the amount of such installments or the frequency of such installments, or both.
Section E13.2. Forfeitures
(a) If a Participant or Merged Participant has a Separation from the Service due to
resignation or discharge, the portions of his Dennison ESOP Account which are not Vested shall be
forfeited upon his completion of five consecutive Break in Service Years. Pending application
under Section 6.9, forfeitures shall be held in suspense and shall not be commingled with amounts
held in suspense under Section 18.4.
(b) If a Participant or Merged Participant has a Separation from the Service prior to becoming
Vested in any portion of his Dennison ESOP Account, a distribution shall be deemed to have occurred
upon such Separation from the Service for purposes of subsection (a).
Section E13.3. Restoration of Forfeitures
If a Participant or Merged Participant whose Dennison ESOP Account is not then fully Vested
E-4
(a) has a Separation from the Service,
(b) suffers a forfeiture under Section E13.2 of the portion of such Account which is
not Vested,
(c) again becomes an Employee or employed by a Company Affiliate before he has five
consecutive Break in Service Years, and
(d) repays to the Plan the full amount, if any, distributed to him from such Accounts
before the end of his fifth consecutive Break in Service Year or, if earlier, the fifth
anniversary of his reemployment,
then the amount forfeited under Section E13.2 by such Participant or Merged Participant and any
interest thereon shall be restored to his Dennison ESOP Account, applying forfeitures pending
reallocation and Company contributions, in that order, as necessary.
Section E14.3. Vesting
(a) For any Plan Year in which the Plan is Top Heavy, the Vested percentage of the Dennison
ESOP Account of each Participant or Merged Participant who completes an Hour of Service in such
Plan Year shall be the percentage of such Account shown on the following table:
|
|
|
|
|
Years of Vesting Service |
|
Vested Percentage |
Less than 2 |
|
|
0 |
% |
2 |
|
|
20 |
% |
3 |
|
|
100 |
% |
(b) The Vested percentage of a Participants or Merged Participants Dennison ESOP Account
shall be not less than the Vested percentage determined as of the last day of the last Plan Year in
which the Plan was Top Heavy.
(c) For any Plan Year in which the Plan is not Top Heavy which follows one or more Plan Years
for which the Plan has been Top Heavy, Section E9.1 shall again become applicable as an amendment
to the Plan; thus, each Participant or Merged Participant who has had his Vested percentage
computed under subsection (a) and who has completed at least one Year of Vesting Service shall be
permitted to elect to have his Vested percentage computed in accordance with subsection (a) for
such Plan Year and any subsequent Plan Year in which the Plan is no longer Top Heavy. Such
Participant or Merged Participant may make such election within an election period beginning no
later than the first day of the first Plan Year in which the Plan is no longer Top Heavy and ending
no later than the later of
(i) the sixtieth day of such Plan Year, or
(ii) a date which is sixty days after the day the Participant or Merged Participant is
issued written notice of his right to make such election by the Administrator.
E-5
Section E16.1. Termination of Plan; Discontinuance of Contributions
(a) (ii) For each Participant or Merged Participant who is then an Employee or employed
by a Company Affiliate with respect to whom the Plan is terminated, the interest in his
Dennison ESOP Account, if any, including his interest in the forfeitures (which shall be
applied under Section 5.4), shall become fully Vested.
* * * * *
References in the following Sections of the Plan to Participants shall be deemed to include
Merged Participants:
1.13 (Cash Account), 1.54 (Qualified Holder), 1.65 (Stock Account), 6.4, 6.6, 6.8, 6.10, 8.1, and
18.2.
E-6
SUPPLEMENT F
This Supplement contains provisions which modify and supplement the Plan in order to
effectuate the merger into the Savings Plan of The Dennison Manufacturing Company Bargaining Unit
Employee Stock Ownership Plan, effective as of the close of business on November 30, 1995. It shall
apply only to Merged Participants and those who are not Merged Participants only because they are
Participants.
The leveraged ESOP portion of the Plan shall include the Dennison Bargaining Unit ESOP
Accounts.
Section F1.1. Accounts
Accounts of a Participant or Merged Participant shall include his Dennison Bargaining Unit
ESOP Account.
Section F1.2. Change in Control
Change in Control shall mean,
(a) The acquisition (other than from Dennison Manufacturing Company) by any person,
entity or group, within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities
Exchange Act of 1934, as amended (the Exchange Act), (excluding, for this purpose,
Dennison Manufacturing Company or its subsidiaries, or any employee benefit plan of Dennison
Manufacturing Company or its subsidiaries) of beneficial ownership (within the meaning of
Rule 13d-3 promulgated under the Exchange Act) of 20% or more of either the then outstanding
shares of common stock of Dennison Manufacturing Company or the combined voting power of the
then outstanding voting securities of Dennison Manufacturing Company entitled to vote
generally in the election of directors of Dennison Manufacturing Company; or
(b) Individuals, who as of January 1, 1990, constitute the Board of Directors of
Dennison Manufacturing Company (as of January 1, 1990, the Incumbent Board) cease for any
reason to constitute at least a majority of the Board of Directors of Dennison Manufacturing
Company, provided that any person becoming a director subsequent to January 1, 1990 whose
election, or nomination for election by the shareholders of Dennison Manufacturing Company,
was approved by a vote of at least a majority of the directors then comprising the Incumbent
Board (other than an election or nomination of an individual whose initial assumption of
office is in connection with an actual or threatened election contest relating to the
election of the directors of Dennison Manufacturing Company, as such terms are sued in Rule
14a-11 of Regulation 14A promulgated under the Exchange Act) shall be, for purposes of the
Plan, considered as though such person were a member of the Incumbent Board; or
(c) Consummation of a reorganization, merger or consolidation, in each case, with
respect to which persons who were the stockholders of Dennison Manufacturing Company
immediately prior to such reorganization, merger or consolidation do not, immediately
thereafter, own, directly or indirectly, more than 50% of the combined voting
F-1
power entitled to vote generally in the election of directors of the reorganized, merged or consolidated
companys then outstanding voting securities, or a liquidation or dissolution of Dennison
Manufacturing Company or of the sale of all or substantially all of the assets of Dennison
Manufacturing Company.
Section F1.3. Dennison Bargaining Unit ESOP
Dennison Bargaining Unit ESOP shall mean The Dennison Manufacturing Company Bargaining Unit
Employee Stock Ownership Plan.
Section F1.4. Dennison Bargaining Unit ESOP Account
Dennison Bargaining Unit ESOP Account shall mean the individual account in the Plan
established for a Participant or Merged Participant as a result of the merger of the Dennison ESOP
into the Savings Plan effective as of the close of business on November 30, 1995.
Section F1.5. Dennison Bargaining Unit ESOP Participant
Dennison Bargaining Unit ESOP Participant shall mean any person who is not a Participant in
the Plan and was not a participant in the Savings Plan, but was a Participant in the Dennison
Bargaining Unit ESOP, for whom the Company maintains a Dennison Bargaining Unit ESOP Account.
Section F1.6. Dennison ESOP
Dennison ESOP shall mean The Dennison Employee Stock Ownership Plan.
Section F1.8. Merged Participant
Merged Participant shall include a Dennison Bargaining Unit ESOP Participant and a Savings
Plan Participant.
Section F1.9. Normal Retirement Date
Normal Retirement Date of a Participant or Merged Participant, but only with respect to his
Dennison Bargaining Unit ESOP Account, shall mean the first day of the calendar month coincident
with or next following the earlier of
(a) his sixty-fifth birthday, or
|
(b) |
|
his fifty-fifth birthday and his completion of five Years of Vesting Service. |
Section F1.10. Savings Plan Participant
Savings Plan Participant shall include any person who is not a Participant in the Plan but
was a participant in the Savings Plan and the Dennison Bargaining Unit ESOP for whom the Company
maintains a Dennison Bargaining Unit ESOP Account and Accounts under the Savings Plan described in
Supplement H.
F-2
Section F1.11. Stock Account
Stock Account of a Participant or Merged Participant shall include his Dennison Bargaining
Unit ESOP Account. For purposes of Section F6.10, Stock Account shall mean only that portion of a
Participants Stock Account held in Company Stock.
Section F1.12. Years of Vesting Service
Years of Vesting Service shall include all service treated as Vesting Service under the
provisions of the Dennison Bargaining Unit ESOP as of the close of business November 30, 1995, as
well as all service otherwise so treated under the provisions of the Savings Plan and the Plan.
Section F6.10. Diversification
Except as provided in subsection 6.10(b) of the Plan, an Active Participant may elect to have
up to the entire amount credited to his Stock Account applied, pursuant to Article VII and the
Rules of the Plan, to investment in such (three or more) Subfunds as are designated for such
purpose under the Rules of the Plan (and notwithstanding any contrary, otherwise applicable, Rules
of the Plan) or distributed to him. Such elections shall be made on such forms or such other
documents or communications as are prescribed by the Administrator.
Section F9.1. Vesting of Accounts
(a) Except as provided in Section F14.3(a) and subsection (b), a Participants or Merged
Participants Dennison Bargaining Unit ESOP Account shall not be Vested until he completes three
Years of Vesting Service at which time it shall become fully Vested.
(b) The interest of a Participant or Merged Participant in his Dennison Bargaining Unit ESOP
Account shall become fully Vested upon the earliest to occur of
(i) it becoming fully Vested under the terms of the Dennison Bargaining Unit ESOP or
the Savings Plan,
(ii) his death,
(iii) his Normal Retirement Date,
(iv) his Disability Retirement Date,
(v) a Change in Control, or
(vi) the termination or discontinuation of the Plan under Section 16.1,
if he is then an affected Employee or employed by a Company Affiliate.
F-3
Section F9.6. Withdrawal After Ten Years of Vesting Service
Notwithstanding any contrary provision of the Plan, any Participant or Merged Participant who
has accrued ten or more Years of Vesting Service at the end of any Plan Year may, without a
Separation from the Service and during his continued participation in the Plan, elect to receive a
distribution of up to 10% (determined in increments of 1%) of the amount credited to his Dennison
Bargaining Unit ESOP Account in one lump sum distribution in the form of cash or stock to the
extent permitted by Section 11.3(b)(i) in accordance with Section 11.3(a).
Section F11.3. Distribution of Accounts
(b) If the entire amount credited to a Participants or Merged Participants Accounts exceeds
$1,000 (excluding his Rollover Account to the extent it consists of rollover contributions
described in Code Section 411(a)(11)(D)), such Participant or Merged Participant may elect to
receive the amount credited to his Dennison Bargaining Unit ESOP Account under any installment
option then available under Section 11.3, except that following commencement of payment, such
Participant may elect to increase the amount of such installments or the frequency of such
installments, or both.
Section F12.2. Distribution on Death
(a) Upon the death of a Participant or Merged Participant whose Accounts exceed $5,000, the
person or persons designated under subsection (b) may elect to receive the amount credited to such
Participants Dennison Bargaining Unit ESOP Account under any installment option then available
under Section 11.3, except that following commencement of payment, such person or persons
designated under subsection (b) may elect to increase the amount of such installments or the
frequency of such installments, or both; provided, however, that such installments shall continue
over a period not longer than the life expectancy of such person.
Section F13.1. Distribution on Resignation or Discharge
(b) if the Vested amount credited to his Accounts exceeds $1,000 (excluding his Rollover
Account to the extent it consists of rollover contributions described in Code Section
411(a)(11)(D)), payment of his Dennison Bargaining Unit ESOP Account under any installment option
then available under Section 11.3, except that following commencement of payment, such Participant
may elect to increase the amount of such installments or the frequency of such installments, or
both.
Section F13.2. Forfeitures
(a) If a Participant or Merged Participant has a Separation from the Service due to
resignation or discharge, the portions of his Dennison Bargaining Unit ESOP Account which are not
Vested shall be forfeited upon his completion of five consecutive Break in Service Years. Pending
application under Section 6.9, forfeitures shall be held in suspense and shall not be commingled
with amounts held in suspense under Section 18.4.
(b) If a Participant or Merged Participant has a Separation from the Service prior to becoming
Vested in any portion of his Dennison Bargaining Unit ESOP Account, a distribution shall be deemed
to have occurred upon such Separation from the Service for purposes of subsection (a).
F-4
Section F13.3. Restoration of Forfeitures
If a Participant or Merged Participant whose Dennison Bargaining Unit ESOP Account is not then
fully Vested
(a) has a Separation from the Service,
(b) suffers a forfeiture under Section F13.2 of the portion of such Account which is
not Vested,
(c) again becomes an Employee or employed by a Company Affiliate before he has five
consecutive Break in Service Years, and
(d) repays to the Plan the full amount, if any, distributed to him from such Accounts
before the end of his fifth consecutive Break in Service Year or, if earlier, the fifth
anniversary of his reemployment,
then the amount forfeited under Section F13.2 by such Participant or Merged Participant and any
interest thereon shall be restored to his Dennison Bargaining Unit ESOP Account, applying
forfeitures pending reallocation and Company contributions, in that order, as necessary.
Section F14.3. Vesting
(a) For any Plan Year in which the Plan is Top Heavy, the Vested percentage of the Dennison
Bargaining Unit ESOP Account of each Participant or Merged Participant who completes an Hour of
Service in such Plan Year shall be the percentage of such Account shown on the following table:
|
|
|
|
|
Years of Vesting Service |
|
Vested Percentage |
Less than 2 |
|
|
0 |
% |
2 |
|
|
20 |
% |
3 |
|
|
100 |
% |
(b) The Vested percentage of a Participants or Merged Participants Dennison Bargaining Unit
ESOP Account shall be not less than the Vested percentage determined as of the last day of the last
Plan Year in which the Plan was Top Heavy.
(c) For any Plan Year in which the Plan is not Top Heavy which follows one or more Plan Years
for which the Plan has been Top Heavy, Section F9.1 shall again become applicable as an amendment
to the Plan; thus, each Participant or Merged Participant who has had his Vested percentage
computed under subsection (a) and who has completed at least one Year of Vesting Service shall be
permitted to elect to have his Vested percentage computed in accordance with subsection (a) for
such Plan Year and any subsequent Plan Year in which the Plan is no longer Top
F-5
Heavy. Such
Participant or Merged Participant may make such election within an election period beginning no
later than the first day of the first Plan Year in which the Plan is no longer Top Heavy and ending
no later than the later of
(i) the sixtieth day of such Plan Year, or
(ii) a date which is sixty days after the day the Participant or Merged Participant is
issued written notice of his right to make such election by the Administrator.
Section F16.1. Termination of Plan; Discontinuance of Contributions
(a) (ii) For each Participant or Merged Participant who is then an Employee or employed by a
Company Affiliate with respect to whom the Plan is terminated, the interest in his Dennison
Bargaining ESOP Account, if any, including his interest in the forfeitures (which shall be applied
under Section 5.4), shall become fully Vested.
* * * * *
References in the following Sections of the Plan to Participants shall be deemed to include
Merged Participants:
1.13 (Cash Account), 1.54 (Qualified Holder), 1.65 (Stock Account), 6.4, 6.6, 6.8, 6.10, 8.1, and
18.2.
F-6
SUPPLEMENT G
This Supplement contains provisions which modify and supplement the Plan in order to
effectuate the merger into the Savings Plan of The Avery Dennison Office Products Company Pre-Tax
Investment Plus Plan, effective as of the close of business November 30, 1995. It shall apply only
to Merged Participants and those who are not Merged Participants only because they are
Participants.
Pursuant to this merger, amounts held in the Deferred Compensation Account, Matching
Account, Qualified Account and Rollover Account of each Participant and Merged Participant
under the ADOPCo 401(k) Plan were merged into the Unmatched PTS Account, Company Contributions
Account, Qualified Account and ADOPCo 401(k) Rollover Account, respectively, under the Savings
Plan.
The profit-sharing portion of the Plan shall include the ADOPCo 401(k) Rollover Accounts.
Section G1.1. Accounts
Accounts of a Participant or Merged Participant shall include his ADOPCo 401(k) Rollover
Account.
Section G1.2. ADOPCo 401(k) Participant
ADOPCo 401(k) Participant shall mean any person who is not a Participant in the Plan and was
not a participant in the Savings Plan but was a participant in the ADOPCo 401(k) Plan, for whom the
Company maintains an ADOPCo 401(k) Rollover Account.
Section G1.3. ADOPCo 401(k) Plan
ADOPCo 401(k) Plan shall mean The Avery Dennison Office Products Company Pre-Tax Investment
Plus Plan.
Section G1.4. ADOPCo 401(k) Rollover Account
ADOPCo 401(k) Rollover Account shall mean the individual account in the Plan established for
a Participant or Merged Participant as a result of the merger of the ADOPCo 401(k) Plan into the
Savings Plan effective as of the close of business November 30, 1995.
Section G1.5. Merged Participant
Merged Participant shall include an ADOPCo 401(k) Participant and a Savings Plan
Participant.
Section G1.6. Savings Plan Participant
Savings Plan Participant shall include any person who is not a Participant in the Plan but
was a participant in the Savings Plan and the ADOPCo 401(k) Plan for whom the Company
G-1
maintains an
ADOPCo 401(k) Rollover Account and Accounts under the Savings Plan described in Supplement H.
Section G9.3. Withdrawals from ADOPCo 401(k) Rollover Accounts
A Participant or Merged Participant who is an Employee may elect in accordance with the Rules
of the Plan to make a lump sum withdrawal of all or any portion of the amount credited to his
ADOPCo 401(k) Rollover Account.
Section G9.6. Withdrawals Upon Attainment of Age Fifty Nine and One Half
A Participant or Merged Participant who remains in the employ of the Company after attaining
age fifty-nine and one-half may elect in accordance with the Rules of the Plan to receive a
distribution of all or any portion of his ADOPCo 401(k) Rollover Account in one lump sum. Such
distributions shall not be made more frequently than at twelve month intervals.
Section G15.14. Loans to Participants and Merged Participants
A Participant or Merged Participant may borrow against his ADOPCo 401(k) Rollover Account with the
approval of the Administrator in accordance with the provisions of subsection (b).
G-2
SUPPLEMENT H
This Supplement contains provisions which modify and supplement the Plan in order to
effectuate the merger of the Savings Plan into the Plan, effective following the close of business
on November 30, 1997. It shall apply only to Merged Participants and those who are not Merged
Participants only because they are Participants.
Pursuant to this merger, amounts held in the Pre-Tax Savings (PTS) Account, the After-Tax
Savings (ATS) Account, the Qualified Account (which shall consist of the Qualified Company
Contribution Account and the Qualified ESOP Account), the Rollover Account, the ESOP
Account, the Company Contributions Account, and the Prior Account of each Participant and
Merged Participant under the Savings Plan will be held in the Pre-Tax Savings (PTS) Account,
the After-Tax Savings (ATS) Account, the Qualified Account, the Rollover Account, the ESOP
Account, the Company Contributions Account, and the Prior Account, respectively, under the
Plan.
The profit-sharing portion of the Plan shall include all Accounts other than the ESOP Accounts
and the Qualified ESOP Accounts which shall be a part of the leveraged ESOP portion of the Plan.
Section H1.1. Accounts
Accounts of a Participant or Merged Participant may include his Company Contributions
Account, Qualified Company Contribution Account and his Prior Account.
Section H1.2. Company Contributions Account
Company Contributions Account of a Participant shall mean his individual account in the
Trust Fund established in accordance with Section H6.2(a).
Section H1.3. ESOP Effective Date
The ESOP Effective Date shall be March 1, 1989.
Section H1.4. Leveraged Company Stock
Leveraged Company Stock shall include Company Stock treated as Leveraged Company Stock
under the provisions of the Savings Plan as of its merger into the Plan.
Section H1.5. Merged Participant
Merged Participant shall include a Savings Plan Participant.
Section H1.6. Prior Account
Prior Account of a Participant or Merged Participant shall mean his account as of November
30, 1976 under the Savings Plan as constituted on that date together with such other accounts,
received by the Savings Plan in a trust-to-trust transfer, as the Administrator designated, each as
adjusted from time to time in accordance with Section 8.2.
H-1
Section H1.7. Qualified Company Contributions Account
Qualified Account of a Participant or Merged Participant shall mean his individual account
in the Trust Fund, if any, established in accordance with Section H6.2(b) pursuant to Sections 3.5
and 6.11.
Section H1.8. Qualified Company Matching Account
Qualified Company Matching Account shall mean the portion of his Qualified Company
Contributions Account established in accordance with Section H6.2(b).
Section H1.9. Qualified Company Non-Matching Account
Qualified Company Non-Matching Account shall mean the portion of his Qualified Company
Contributions Account established in accordance with Section H6.2(b).
Section H1.10. Savings Plan Participant
Savings Plan Participant shall mean any person who is not a Participant in the Plan, but was
a participant in the Savings Plan prior to the Merger, for whom the Company maintains Accounts as
described in this Supplement or for whom the Company may maintain other Accounts described in
Supplements A-G because he also participated in the PAYSOP, the White Graphic Plan, the
Kingsbacher-Murphy Plan, a Dennison 401(k) Plan, the Dennison ESOP, the Dennison Bargaining Unit
ESOP or the ADOPCo 401(k) Plan.
Section H3.5. Deferral Percentage Failsafe Provisions
(d)(ii) To the extent permitted by Code Section 401(a)(4) and Treas. Reg.
§ 1.401(k)-1(b)(5) (which are incorporated herein by this reference), the Company may make
additional contributions
A to the Qualified Company Non-Matching Accounts, or,
B to be applied to payment of Current Obligations
with the condition that the contributions under subparagraph A, or the shares of
Company Stock released from the Suspense Account pursuant to Sections 6.8 and 6.9 by reason
of the contributions under subparagraph A, or shall be allocated to the Qualified
Company Non-Matching Accounts of certain Participants in inverse order of Compensation
received in the Plan Year in question (lowest compensated Participant receiving the first
allocation) with each Participant who receives an allocation receiving the maximum
allocation permitted by Code Section 415 before any Participant with greater Compensation
receives any allocation, until such contribution is fully allocated.
(iii) Amounts otherwise to be credited under Section 6.3(b) to Company Contributions
Accounts for such Plan Year shall be credited instead to Qualified Company Matching Accounts
of the Participants in question.
H-2
Section H6.2. Company Contributions Account; Qualified Company Contributions
Account
(a) The Administrator shall maintain a Company Contributions Account for each Participant or
Merged Participant, to which shall be credited the amounts allocated thereto under the Savings Plan
with respect to all periods prior to the ESOP Effective Date and to which shall be credited or
debited amounts determined under Section 8.2.
(b) The Administrator shall maintain a Qualified Company Contributions Account for each
Participant or Merged Participant consisting of a Qualified Company Matching Account and a
Qualified Company Non-Matching Account to which shall be credited the amounts allocated thereto
under Sections H6.11(b)(iii) and (iv) and H3.5(d)(ii) and (iii) and to which shall be credited or
debited amounts deferred under Section 8.2.
Section H6.10 Diversification
Except as provided in subsection 6.10(b) of the Plan, this Section shall apply to any Active
Participant.
Section H6.11. Contribution Percentage Fail-Safe Provisions
(b)(iii) To the extent permitted by Code Section 401(a)(4) and Treas. Reg.
§ 1.401(m)-1(b)(5) (which are incorporated herein by this reference), the Company may make
an additional contribution
A to the Qualified Company Non-Matching Accounts, or
B to be applied to payment of Current Obligations
with the condition that the contributions under subparagraph A, or the shares of
Company Stock released from the Suspense Account pursuant to Sections 6.8 and 6.9 by reason
of the contributions under subparagraph A, shall be allocated to the Qualified
Company Matching Accounts of Participants in inverse order of Compensation received in the
Plan Year in question (lowest compensated Participant receiving the first allocation) with
each Participant who receives an allocation receiving the maximum allocation permitted by
Code Section 415 before any Participant with greater Compensation receives any allocation,
until such contribution is fully allocated.
(iv) To the extent permitted by Code Section 401(a)(4), amounts otherwise to be
credited under Section 6.3(b) to Company Contributions Accounts for such Plan Year shall be
credited instead to Qualified Company Matching Accounts of the Participants in question.
Section H9.2. Unrestricted Withdrawals
(a) Subject to the Rules of the Plan, once each Plan Year and, if the Administrator determines
that a Hardship (including, for this purpose, an event described in Section 1.34(a)(viii)b)
has occurred, on one additional occasion in such Plan Year, a Participant or Merged Participant who
has not incurred a Separation from the Service may withdraw up to one hundred percent of the
following Accounts in the following order (and subject to the following conditions)
H-3
with no amounts withdrawn from a later designated Account until all earlier designated Accounts are exhausted:
(i) ATS Account. Withdrawals from such Accounts shall be at least one thousand
dollars or, if less, the amount of such Accounts.
(ii) Company Contributions Account.
(b) A Participant or Merged Participant who makes a withdrawal under subsection (a) shall not
be permitted to make any contributions to the Plan and shall not receive a contribution under
subsection 6.3(b) for
(i) three months for a withdrawal under paragraph (a)(i),
(ii) six months for a withdrawal under paragraph (a)(ii),
or such other periods as are specified in the Rules of the Plan.
Section H9.6. Withdrawals Upon Attainment of Age Fifty-Nine and One Half
A Participant or Merged Participant who remains in the employ of the Company after attaining
age fifty-nine and one-half may elect in accordance with the Rules of the Plan to receive a
distribution of all or any portion of his Company Contributions Account or his Qualified Account in
one lump sum. Such distributions shall not be made more frequently than at twelve month intervals.
Section H15.14. Loans to Participants or Former Participants
(a) A Participant or Merged Participant (Borrower) may borrow against his Company
Contributions Account, Qualified Account or Prior Account and/or other Accounts with the approval
of the Administrator in accordance with the provisions of subsection (b).
(vii) The Vested percentage of a Borrowers Company Contributions Account, Qualified
Account or Prior Account which is made available for borrowing shall not be higher for
Participants or Merged Participants who are Highly Compensated Employees, officers or
shareholders than for other Borrowers.
* * * * *
References in the following Sections of the Plan to Participants shall be deemed to include
Merged Participants:
1.13 (Cash Account), 1.54 (Qualified Holder), 1.65 (Stock Account), 6.4, 6.6, 6.8, 6.10, 8.1,
and 18.2
H-4
SUPPLEMENT I
This Supplement contains provisions which modify and supplement the Plan in order to document
the dormant SHARE Accounts under the Plan after the Merger. It shall apply only to Participants
and SHARE Participants who participated in the Plan prior to the Merger.
The leveraged ESOP portion of the Plan shall include the SHARE Accounts.
Section I1.1. Accounts
Accounts of a Participant or SHARE Participant shall include his SHARE Account.
Section I1.2. Defined Benefit Plan
Defined Benefit Plan at any time shall mean The Retirement Plan for Employees of Avery
Dennison Corporation as then constituted, or its successor.
Section I1.3. Leveraged Company Stock
Leveraged Company Stock shall include Company Stock treated as Leveraged Company Stock
under the provisions of the Plan in effect prior to the Merger.
Section I1.4. SHARE Participant
SHARE Participant shall mean any person who is not a Participant in the Plan, but was a
Participant in the Plan prior to the Merger, for whom the Company maintains a SHARE Account.
Section I1.5. SHARE Account
SHARE Account shall mean the individual dormant SHARE Cash Account and the individual
dormant SHARE Stock Account established for a Participant or SHARE Participant effective as of the
Merger.
Section I1.6. SHARE Cash Account
SHARE Cash Account shall mean a dormant sub-account established and maintained for each
Participant or SHARE Participant under Section I6.2(d) for purposes of holding and accounting for
assets other than Company Stock held in the Trust Fund and allocated to Participants and SHARE
Participants prior to the Merger.
Section I1.7. SHARE Stock Account
SHARE Stock Account of a Participant or SHARE Participant shall mean the dormant account
established and maintained for each Participant and SHARE Participant under Section I6.2(d) for
purposes of holding and accounting for Company Stock held in the Trust Fund and allocated to
Participants and SHARE Participants prior to the Merger.
I-1
Section I1.8. Stock Account
Stock Account of a Participant or SHARE Participant shall include his SHARE Account.
Section I6.2. SHARE Account
(d) The Administrator shall maintain a dormant SHARE Account for each Participant or SHARE
Participant to which shall be credited the amounts allocated thereto under the Plan with respect to
all periods prior to the Merger and to which shall be credited or debited amounts determined under
Section 8.2.
Section I6.8. Release and Allocation of Leveraged Company Stock
No Leveraged Company Stock shall be released and allocated to SHARE Stock Accounts pursuant to
this Section on or after December 1, 1997.
Section I6.9. Allocation of Forfeitures Accounting for Forfeitures
(b) Except as provided in Section 18.4(a), Participants who are Employees at the end of the
Plan Year in question and who have SHARE Accounts maintained for them under the Plan shall also
share in amounts forfeited from SHARE Cash Accounts and SHARE Stock Accounts under Sections
I12.2(b)(iii), I13.2 and I15.8 in proportion to their Compensation received in such Plan Year while
Active Participants.
(c) The aggregate shares of Company Stock forfeited under Sections I12.2(b)(iii), I13.2 and
I15.8 from SHARE Stock Accounts shall be reallocated under subsection (b) in shares and fractional
shares and credited to Participants SHARE Stock Accounts.
(d) The aggregate amounts forfeited under Sections I12.2(b)(iii), I13.2 and I15.8 from Cash
Accounts shall be reallocated under subsection (b) and credited to Participants SHARE Cash
Accounts.
Section I6.12. Retirement Fund
The Administrator shall establish a subfund in the Trust Fund designated the Retirement
Subfund. Effective as of the election by a Participant or SHARE Participant pursuant to either
Sections I11.3(a) or I11.3(b)(iii) or Section I13.1(a) or I13.1(b)(ii) (or an election to elect
treatment under Section I11.3(b)(iii) under Section I12.2(a) or a Spousal election under Section
I12.2(c)), (i) such Participants or SHARE Participants SHARE Account balances shall be reduced by
the amount of such SHARE Account so transferred to the Defined Benefit Plan, and (ii) assets with a
value, determined pursuant to Article VIII, equal to the portion of his Accounts so transferred
shall become an asset of the Retirement Subfund of the Trust Fund to be held for the benefit of
that certain trust fund established under the Master Retirement Trust Agreement of Avery Dennison
Corporation (the Retirement Plan Trust Fund). Any shares of Company Stock so transferred to the
Retirement Subfund shall be exchanged for cash as soon as possible. No less frequently than once
per Plan Year the assets held in the Retirement Subfund shall be transferred to the Retirement Plan
Trust Fund.
I-2
Section I8.1. Determination of Values
(b) (ii)C For purposes of a Participants or SHARE Participants exercise of
his put option rights (if applicable) under Article XVII or for purposes of valuing Company
Stock in a lump sum or installment distribution under Section I11.3(b)(i), 11.3(b)(ii),
I12.2(a), I13.1(a) or I13.1(b)(i) with respect to his SHARE Account, such Leveraged Company
Stock shall be valued as of the end of the most recent Plan Year.
(c) The valuation of Company Stock (or diversified amounts not held in Company Stock) in a
Participants or SHARE Participants SHARE Account pursuant to a transfer election (or in the
absence of a transfer election, for purposes of the Participants ESOP Reduction under the Defined
Benefit Plan) shall occur as of the close of the last business day of the month of the
Participants Separation from the Service in accordance with the Rules of the Plan.
Section I9.1. Vesting of Accounts
(b) Except as provided in Section 14.3(a) and subsection (c), a Participants or SHARE
Participants SHARE Account shall not be Vested until he completes five Years of Vesting Service at
which time it shall become fully Vested.
(c) The interest of a Participant in his SHARE Account shall become fully Vested upon the
earliest to occur of
(i) his death,
(ii) his sixty-fifth birthday, or
(iii) the termination or discontinuation of the Plan under Section 16.1,
if he is then an affected Employee or employed by a Company Affiliate.
Section I11.3. Distribution or Transfer of Accounts
(a) Subject to subsection (c), if the entire amount credited to a Participants or SHARE
Participants SHARE Account (together with the amounts credited to all other of his Accounts
(including under Supplements)) does not exceed $1,000 (excluding his Rollover Account to the extent
it consists of rollover contributions described in Code Section 411(a)(11)(D)), such Participant
shall receive such amount in one lump sum cash distribution. Alternatively, such Participant may
elect to have his SHARE Account transferred to the Defined Benefit Plan as described in subsection
(b)(iii).
(b) Subject to subsection (c), if the entire amount credited to a Participants or SHARE
Participants SHARE Account (together with the amounts credited to all other of his Accounts
(including under Supplements)) exceeds $1,000 (excluding his Rollover Account to the extent it
consists of rollover contributions described in Code Section 411(a)(11)(D)), such Participant may
elect to receive (or transfer) such amount under one of the following options:
(iii) Transfer, of such amount to the Defined Benefit Plan (provided that if transfer
of any part of such amount would cause the benefit under the Defined Benefit Plan to exceed
the limitations of Code Section 415(b)(1), or the Formula Amount (as defined in
I-3
the Defined Benefit Plan), then such part of such amount shall not be transferred but,
to the extent allowed under Code Section 415, shall be distributed under one of paragraphs
(i)-(ii) as elected by the Participant or SHARE Participant);
provided, however, that any election to transfer under subsection (a) or paragraph (iii) shall only
be effective if made within the 60-day period which begins on the later of the date the
Participants election forms are mailed to the Participant or the date of his Separation from the
Service. If such Participant fails to make an election to transfer within this 60-day period, he
may not elect to transfer his Accounts at any subsequent time and his Accounts shall be distributed
to him as otherwise provided herein. If the Participant or SHARE Participant fails to make any
election under this subsection, his Accounts shall be distributed to him in one lump sum as
provided in paragraph (i).
(c) A Participant shall make a separate election with respect to his SHARE Account in
accordance with the Rules of the Plan.
Section I12.2. Distribution or Transfer on Death
(a) Subject to Section I12.3, upon the death of a Participant, former Participant or SHARE
Participant, the Vested amount credited to his SHARE Account (as determined under Section I9.1)
shall be paid in one lump sum distribution in cash or in whole shares of Company Stock (except that
the equivalent of any fractional share shall be distributed in cash at fair market value as most
recent by determined under Article VIII) as the person or persons entitled thereto under subsection
(b) may elect unless another method of distribution or transfer is elected by the Participant,
former Participant or SHARE Participant under Section I11.3, or unless a Spousal election is made
under subsection (c).
(b) Distribution under subsection (a) shall be made not later than ninety days following such
Participants death (or such longer reasonable period as is permitted under Treas. Reg.
§1.401(a)-20 A-3(b)(1)) to his then Surviving Spouse, if any, except to the extent, if any, to
which such Surviving Spouse has consented under Section 12.1(c) to the designation of other
beneficiaries and otherwise (such as if such Participant had not designated a Beneficiary before
his death), to the person or persons of highest priority who survive him by at least thirty days
determined as follows:
(i) First, to his then surviving highest priority Beneficiary or Beneficiaries, if any.
(ii) Second, to his then surviving heirs at law, if any, as determined in the
reasonable judgment of the Administrator under the laws governing succession to personal
property of the last jurisdiction in which the Participant or SHARE Participant was a
resident.
(iii) Third, to Participants in the Plan (to be reallocated in accordance with Section
I6.9).
(c) Notwithstanding subsection (a), if the Vested amount credited to the SHARE Account
(together with the amounts credited to all other of the Participants Accounts (including under
Supplements)) of a deceased Participant, former Participant or SHARE Participant exceeds $5,000,
and the Beneficiary is the Participants Spouse, such Spouse may elect within the 60-day period
which begins on the later of the date the Spouses election forms are mailed to the Spouse or
I-4
the date of the Participants death to have transferred such amount to the Defined Benefit
Plan, to supplement the benefit payable to such Spouse under the Defined Benefit Plan (provided
that if transfer of any part of such amount would cause the benefit under the Defined Benefit Plan
to exceed the limitations of Code Section 415(b)(1), or the Formula Amount (as defined in the
Defined Benefit Plan), then such part of such amount shall not be transferred but, to the extent
allowed under Code Section 415, shall be distributed under subsection (a) or Section I12.3(a). If
the Surviving Spouse fails to make an election to transfer within this 60-day period, such
Surviving Spouse may not elect to transfer the Participants, former Participants or SHARE
Participants Accounts at any subsequent time and such Accounts shall be distributed to the
Surviving Spouse under another alternative available to such Spouse under this Article. The
Surviving Spouse shall make a separate election with respect to the deceased Participants SHARE
Account in accordance with the Rules of the Plan.
Section I12.3 Election of Other Payment Methods
(a) Subject to subsection (c), but notwithstanding any other provision of this Article
and in lieu of the lump sum payment otherwise provided for in this Article, if the deceased
Participants or SHARE Participants Vested Account balance exceeds $5,000, payments under
this Article to the Spouse of such Participant shall be made under such option available
under Section 11.3 as such Spouse shall designate.
(b) Subject to subsection (c), but notwithstanding any other provision of this
Article, a Participant or SHARE Participant may elect on the form provided by the
Administrator for Beneficiary designations that, in lieu of the lump sum payment otherwise
provided for in this Article payments under this Article to his Beneficiary shall be made
under such option available under Section 11.3 as such Participant shall designate in such
form provided that upon the Participants death, his Vested Account balance exceeds $5,000.
If a Beneficiary receiving installment payments under this Section dies, the balance then
due shall be paid in cash in one lump sum to the then surviving person with highest
priority under Section I12.2(b).
(c) If a Participant or SHARE Participant dies before distribution of his SHARE
Account commences, then
(i) such Accounts must be distributed within five years of the Participants or SHARE
Participants death, or
(ii) if any portion of such Accounts is payable to or for the benefit of a Beneficiary,
such portion shall be distributed over the life or the life expectancy of such Beneficiary
with distributions commencing
a within one year of such Participants death, or,
b if the Beneficiary is such Participants Spouse, no later than the
date on which the Participant or SHARE Participant would have attained age seventy
and one half (but if such Spouse dies before distributions to such Spouse commence,
then such Spouse shall be treated as the Participant for purposes of this Section
12.3(c)), or
I-5
c on such other date as is allowed by law.
(d) The Surviving Spouse shall make a separate election with respect to the deceased
Participants SHARE Account in accordance with the Rules of the Plan.
Section I13.1. Distribution or Transfer on Resignation or Discharge
(a) Subject to subsection (c), if a Participant or SHARE Participant has a Separation from the
Service due to resignation or discharge, and
(i) if the Vested amount credited to his SHARE Account (together with the amounts
credited to all other of his Accounts (including under Supplements)) does not exceed
$1,000 (excluding his Rollover Account to the extent it consists of rollover contributions
described in Code Section 411(a)(11)(D)), he shall receive such amount in one lump sum
distribution in cash, with such distribution to be made not later than six months after the
end of the Plan Year in which such Separation from the Service occurs, or, if earlier,
within sixty days after the end of the Plan Year in which his sixty-fifth birthday occurs
or, if he has attained age 55 as of his Separation from the Service, he may also elect to
have his SHARE Account transferred to the Defined Benefit Plan as described in subsections
(ii)b, or
(ii) if the Vested amount credited to his SHARE Account (together with the amounts
credited to all other of his Accounts (including under Supplements)) exceeds $1,000
(excluding his Rollover Account to the extent it consists of rollover contributions
described in Code Section 411(a)(11)(D)),
a he shall receive such amount in one lump sum in cash with such
distribution to be made on such date as he shall elect in accordance with Code
Section 411(a)(11) but not later than the April 1 following the calendar year of his
attainment of age seventy and one-half,
b if he has attained age 55 as of his Separation from the Service, he
may elect to transfer his SHARE Account to the Defined Benefit Plan to supplement
the benefit payable under that plan (provided that if transfer of any part of such
amount would cause the benefit under the Defined Benefit Plan to exceed the
limitations of Code Section 415(b)(1), or the Formula Amount (as defined in the
Defined Benefit Plan), then such part of his SHARE Account shall not be transferred
but, to the extent allowed under Code Section 415, shall be distributed under
subparagraph a or Section 13.1(b)(ii) (if he so qualifies), as elected by
the Participant, in accordance with Code Sections 411(a)(11) and 401(a)(9)), or
c if he has not attained age 55 as of his Separation from the Service,
he may elect to transfer his SHARE Account to the Defined Benefit Plan as described
in paragraph (ii)b only if his benefit under the Defined Benefit Plan could
not be involuntarily cashed out under the provisions of Section 4.17 thereof (or its
successor).
(b) Any transfer election under subsection (a) must be made by the Participant or SHARE
Participant within the 60-day period which begins on the later of the date the election
forms are mailed to the Participant or the date of such Participants
I-6
Separation from the Service. If such Participant fails to make an election to transfer
within this 60-day period, he may not elect to transfer his Accounts at any subsequent time
and his Accounts shall be distributed to him under another alternative available to him
under this Section.
(c) At any time before the lump sum distribution under subsection (a) is made, the
Participant may elect in accordance with the Rules of the Plan to receive the amount in
whole shares of Company Stock (and to the extent of any fractional share, cash) valued as
determined under Article VIII.
(d) A Participant shall make a separate election with respect to his SHARE Account in
accordance with the Rules of the Plan.
Section I13.2. Forfeitures
(a) If a Participant or SHARE Participant has a Separation from the Service due to resignation
or discharge, the portion of his SHARE Account which is not Vested shall be forfeited upon the
earlier of his receipt of his distribution under this Article or his completion of five consecutive
Break in Service Years. Pending reallocation under Section I6.9, forfeitures shall be held in
suspense and shall not be commingled with amounts held in suspense under Section 18.4(b).
(b) In the case of a forfeiture by a Participant or SHARE Participant whose SHARE Account is
partially Vested, such forfeiture shall be applied first to his Cash Account, if any, and then, as
necessary, to his Stock Account which was not Leveraged Company Stock, and then to Company Stock
which was Leveraged Company Stock.
Section I13.3. Restoration of Forfeitures
If a Participant or SHARE Participant whose SHARE Account is not then fully Vested
(a) has a Separation from the Service,
(b) suffers a forfeiture of the portions of such Accounts which are not Vested,
(c) again becomes an Employee or employed by a Company Affiliate before he has five
consecutive Break in Service Years, and
(d) repays to the Plan the full amount, if any, distributed to him from such Accounts
before the end of five consecutive Break in Service Years commencing after his distribution,
or, if earlier, the fifth anniversary of his reemployment,
then the amount forfeited under Section I13.2 by such Participant shall be restored to his SHARE
Account, applying forfeitures pending reallocation and Company contributions, in that order, as
necessary.
I-7
Section I14.3. Vesting
(a) For any Plan Year in which the Plan is Top Heavy, the Vested percentage of the SHARE
Account of each Participant or SHARE Participant who completes an Hour of Service in such Plan Year
shall be the percentage of such Account shown on the following table:
|
|
|
|
|
Years of Vesting Service |
|
Vested Percentage |
less than 2
|
|
|
0 |
% |
|
|
|
|
|
2
|
|
|
20 |
% |
|
|
|
|
|
3
|
|
|
40 |
% |
|
|
|
|
|
4
|
|
|
60 |
% |
|
|
|
|
|
5
|
|
|
100 |
% |
(b) The Vested percentage of a Participants or SHARE Participants SHARE Account shall be not
less than the Vested percentage determined as of the last day of the last Plan Year in which the
Plan was Top Heavy.
Section I15.8. Effect of Delay or Failure to Ascertain Amount Distributable
or to Locate Distributes
(b) If, within one year after a Participant or SHARE Participant has a Separation from the
Service, the Administrator, in the exercise of due diligence, has failed to locate him (or if such
Separation from the Service is by reason of his death, has failed to locate the person entitled to
his Vested SHARE Account under Section I12.2), his entire distributable interest in the Plan shall
be forfeited and reallocated under Section I6.9; provided, however, that if the Participant (or in
the case of his death, the person entitled thereto under Section I12.2) makes proper claim
therefor, the amount so forfeited shall be restored to the Participants SHARE Account, applying
forfeitures pending reallocation, Company contributions and unallocated earnings and gains of the
Trust Fund, in that order, as necessary.
Section I16.1. Termination of Plan; Discontinuance of Contributions
(a) (ii) For each Participant or SHARE Participant who is then an Employee or employed by a
Company Affiliate with respect to whom the Plan is terminated, the interest in his SHARE Account,
if any, including his interest in the forfeitures (which shall be applied under Section I6.9),
shall become fully Vested.
* * * * *
References in the following Sections of the Plan to Participants shall be deemed to include
SHARE Participants:
1.13 (Cash Account), 1.54 (Qualified Holder), 1.65 (Stock Account), 6.4, 6.6, 6.8, 6.10, 8.1, and
18.2.
I-8
SUPPLEMENT J
This Supplement contains provisions which modify and supplement the Plan in order to
effectuate the merger of the Bear Rock Technologies 401(k) Profit Sharing Plan into the Plan,
effective as of March 31, 2000. It shall apply only to Merged Participants and those who are not
Merged Participants only because they are Participants.
Pursuant to this merger, amounts held in the Elective Deferrals Account, and Qualified
Matching Contributions Account, including Qualified Nonelective Contributions Account, under the
Bear Rock Technologies 401(k) Profit Sharing Plan (the Bear Rock Plan) shall be merged into and
maintained as a subaccount of the Unmatched PTS Account and Qualified Account, respectively, under
the Plan. Amounts held in the Employer Contributions Account, Rollover Contribution Account
and Matching 401(k) Contribution Account, established under the Bear Rock Plan shall be
maintained in the Bear Rock Employers Contributions Account, Bear Rock Rollover Contributions
Account and Bear Rock Matching 401(k) Account under the Plan.
The profit-sharing portion of the Plan shall include the Bear Rock Employer Contributions
Account and Bear Rock Rollover Account.
Section J1.1 Accounts
Accounts of a Participant or Merged Participant shall include his Bear Rock Accounts.
Section J1.2 Bear Rock Accounts
Bear Rock Accounts of a Participant or Merged Participant shall mean his accounts
established under the Bear Rock Plan, including his Bear Rock Employer Contributions Account, Bear
Rock Rollover Contribution Account and his Bear Rock Matching 401(k) Account.
Section J1.3 Bear Rock Plan
Bear Rock Plan shall mean the Bear Rock Technologies 401(k) Profit Sharing Plan.
Section J1.4 Bear Rock Employer Contributions Account
Bear Rock Employer Contributions Account shall mean the individual account in the Plan
established for a Participant or Merged Participant as a result of the merger of the Bear Rock Plan
into the Plan, effective as of March 31, 2000.
Section J1.5 Bear Rock Participant
Bear Rock Participant shall mean any person who is not a Participant in the Plan but was a
participant in the Bear Rock Plan, for whom the Company maintains a Bear Rock Employer
Contributions Account and a Bear Rock Rollover Contribution Account, if any.
J-1
Section J1.6 Bear Rock Matching 401(k) Account
Bear Rock Matching 401(k) Account shall mean the individual account in the Plan established
for a Participant or Merged Participant as a result of the merger of the Bear Rock Plan into the
Plan, effective as of March 31, 2000.
Section J1.7 Bear Rock Rollover Contribution Account
Bear Rock Rollover Contribution Account shall mean the individual account in the Plan
established for a Participant or Merged Participant as a result of the merger of the Bear Rock Plan
into the Plan, effective as of March 31, 2000.
Section J1.8 Hour of Service
For purposes of Section 1.36, any references to the Company with respect to periods before
March 31, 2000, shall include Bear Rock Technologies Corp.
Section J1.9 Merged Participant
Merged Participant shall include a Bear Rock Participant.
Section J1.43 Normal Retirement Date
Normal Retirement Date of a Participant or Merged Participant with respect to his Bear Rock
Accounts shall mean the first day of the month coincident with or next following his attainment of
age 59 1/2.
Section J1.75 Years of Vesting Service
Years of Vesting Service shall include all service treated as Vesting Service under the
provisions of the Bear Rock Plan as of March 31, 2000, as well as all service otherwise so treated
under the provisions of the Plan.
Section J9.1 Vesting of Accounts
(b) Except as provided in Section 14.3(a) and subsection (c), the Vested portion of a
Participants or Merged Participants Bear Rock Employer Contributions Account and Bear Rock
Matching 401(k) Account shall be the percentage of such Accounts shown on the following table:
J-2
|
|
|
|
|
Years of Vesting Service |
|
Vested Percentage |
1 (or less)
|
|
|
0 |
% |
|
|
|
|
|
2
|
|
|
20 |
% |
|
|
|
|
|
3
|
|
|
40 |
% |
|
|
|
|
|
4
|
|
|
60 |
% |
|
|
|
|
|
5
|
|
|
80 |
% |
|
|
|
|
|
6
|
|
|
100 |
% |
(c) The interest of a Participant or Merged Participant in his Bear Rock Employer
Contributions Account and Bear Rock Matching 401(k) Account shall become fully Vested upon the
earliest to occur of
(i) his death,
(ii) his attainment of age 59 1/2,
(iii) his Disability Retirement Date, or
(iv) the termination or discontinuance of the Plan under Section 16.1,
if he is then an affected Employee or employed by a Company Affiliate.
Section J9.3 Withdrawals from Bear Rock Rollover Contribution Accounts
A Participant or Merged Participant who is an Employee may elect in accordance with the Rules
of the Plan to make a lump sum withdrawal of all or any portion of the amount credited to his Bear
Rock Rollover Contribution Account.
Section J9.6 Withdrawals Upon Attainment of Age Fifty-Nine and One Half
A Participant or a Merged Participant who retains in the employ of the Company after attaining
age fifty-nine and one-half may elect in accordance with the Rules of the Plan to receive a
distribution of all or any portion of his Bear Rock Accounts in one lump sum.
Section J14.3 Vesting
(a) For any Plan Year in which the Plan is Top-Heavy, the Vested percentage of his Bear Rock
Employer Contributions Account and Bear Rock Matching 401(k) Contributions Account of each
Participant or Merged Participant who completes an Hour of Service in such Plan Year shall be the
percentage of such Account shown on the following table:
J-3
|
|
|
|
|
Years of Vesting Service |
|
Vested Percentage |
1 (or less)
|
|
|
0 |
% |
|
|
|
|
|
2
|
|
|
20 |
% |
|
|
|
|
|
3
|
|
|
40 |
% |
|
|
|
|
|
4
|
|
|
60 |
% |
|
|
|
|
|
5
|
|
|
80 |
% |
|
|
|
|
|
6 (or more)
|
|
|
100 |
% |
Section J15.14 Loans to Participants or Former Participants
(a) A Participant or Merged Participant may borrow against his Bear Rock Accounts with the
approval of the Administrator in accordance with the provisions of subsection (b).
J-4
SUPPLEMENT K
This Supplement contains provisions which modify and supplement the Plan in order to
effectuate the merger of the Stimsonite Corporation Retirement Plan into the Plan, effective as of
September 1, 2000. It shall apply only to Merged Participants and those who are not Merged
Participants only because they are Participants.
This Supplement K is hereby amended by deleting Articles KXI, KXII and KXIII and Section K9.8
(together with corresponding definitions in Sections K1.2, K1.3, K1.6 and K1.7) effective as of the
90th day following the date that Participants who have Stimsonite Accounts, Stimsonite
Participants (as defined in Section K1.12) and Beneficiaries of such Participants and Stimsonite
Participants who are receiving benefits from Stimsonite Accounts have been furnished a summary that
reflects the elimination of the alternate forms of payment described thereunder and that satisfies
the requirements of 29 CFR 2520.104b-3 (relating to a summary of material modifications).
Pursuant to this merger, amounts held in Salary Savings Contribution Accounts, 401(a)
Employer Contribution Accounts, Rollover Accounts and 401(k) Employer Match Contribution
Accounts, established under the Stimsonite Plan shall be maintained in Stimsonite Salary Savings
Contribution Accounts, Stimsonite 401(a) Employer Contribution Accounts, Stimsonite Rollover
Accounts and Stimsonite 401(k) Employer Match Contribution Accounts under the Plan.
The profit-sharing portion of the Plan shall include the Stimsonite 401(a) Employer
Contribution Account and Stimsonite Rollover Account.
Section K1.1 Accounts
Accounts of a Participant or Merged Participant shall include his Stimsonite Accounts.
Section K1.2 [Reserved]
Section K1.3 [Reserved]
Section K1.4 Hour of Service
For purposes of Section 1.36, any references to the Company with respect to periods before
September 1, 2000, shall include Stimsonite Corporation.
Section K1.5 Merged Participant
Merged Participant shall include a Stimsonite Participant.
Section K1.6 [Reserved]
Section K1.7 [Reserved]
K-1
Section K1.8 Stimsonite Accounts
Stimsonite Accounts of a Participant or Merged Participant shall mean his accounts
established under the Stimsonite Plan, including his Stimsonite Salary Savings Contribution
Account, Stimsonite 401(a) Employer Contribution Account, Stimsonite Rollover Account and his
Stimsonite 401(k) Employer Match Contribution Account.
Section K1.9 Stimsonite Plan
Stimsonite Plan shall mean the Stimsonite Corporation Retirement Plan.
Section K1.10 Stimsonite 401(a) Employer Contribution Account
Stimsonite 401(a) Employer Contribution Account shall mean the individual account in the
Plan established for a Participant or Merged Participant as a result of the merger of the
Stimsonite Plan into the Plan, effective as of September 1, 2000.
Section K1.11 Stimsonite 401(k) Match Employer Contributions Account
Stimsonite 401(k) Match Contributions Account shall mean the individual account in the Plan
established for a Participant or Merged Participant as a result of the merger of the Stimsonite
Plan into the Plan, effective as of September 1, 2000.
Section K1.12 Stimsonite Participant
Stimsonite Participant shall mean any person who is not a Participant in the Plan but was a
participant in the Stimsonite Plan, for whom the Company maintains a Stimsonite 401(a) Employer
Contributions Account and a Stimsonite Rollover Contribution Account, if any.
Section K1.13 Stimsonite Rollover Account
Stimsonite Rollover Account shall mean the individual account in the Plan established for a
Participant or Merged Participant as a result of the merger of the Stimsonite Plan into the Plan,
effective as of September 1, 2000.
Section K1.14 Stimsonite Salary Savings Contribution Account
Stimsonite Salary Savings Contribution Account shall mean the individual account in the Plan
established for a Participant or Merged Participant as a result of the merger of the Stimsonite
Plan into the Plan, effective as of September 1, 2000.
Section K1.75 Years of Vesting Service
Years of Vesting Service shall include all service treated as Vesting Service under the
provisions of the Stimsonite Plan as of September 1, 2000, as well as all service otherwise so
treated under the provisions of the Plan.
K-2
Section K9.1 Vesting of Accounts
Each Participants or Merged Participants interest in his Stimsonite Accounts shall be Vested
at all times.
Section K9.6 Withdrawals Upon Attainment of Age 591/2
A Participant or Merged Participant who is an Employee and has attained age 591/2 may elect in
accordance with the Rules of the Plan to make a lump sum withdrawal of all or any portion of the
amount credited to his Stimsonite Rollover Account, Stimsonite Salary Savings Contribution Account
and Stimsonite 401(k) Employer Match Contribution Account.
Section K9.8 [Reserved]
Section K15.14 Loans to Participants or Former Participants
(a) A Participant or Merged Participant may borrow against his Stimsonite Accounts with the
approval of the Administrator in accordance with the provisions of subsection (b).
K-3
SUPPLEMENT L
This Supplement contains provisions which modify and supplement the Plan in order to
effectuate the merger of the Dunsirn Industries, Inc. Employee Savings and Retirement Plan into the
Plan, effective as of December 31, 2001. It shall apply only to Merged Participants and those who
are not Merged Participants only because they are Participants.
Pursuant to this merger, amounts held in Participant Elective Accounts, Participant
Accounts (consisting of employer matching contributions and employer discretionary contributions),
Qualified Non-Elective Accounts (if any) and Rollover Accounts established under the Dunsirn
Plan (Dunsirn Accounts) shall be maintained in the Pre-Tax Savings (PTS) Accounts, the
Dunsirn Participant Accounts, Qualified Accounts and Rollover Accounts under the Plan.
The profit-sharing portion of the Plan shall include the Dunsirn Participant Accounts.
Section L1.1 Accounts
Accounts of a Participant or Merged Participant shall include his Dunsirn Participant
Account.
Section L1.2 Dunsirn Participant
Dunsirn Participant shall mean any person who is not a Participant in the Plan but was a
participant in the Dunsirn Plan, for whom the Company maintains Dunsirn Accounts.
Section L1.3 Dunsirn Plan
Dunsirn Plan shall mean the Dunsirn Industries, Inc. Employee Savings and Retirement Plan.
Section L1.4 Merged Participant
Merged Participant shall include a Dunsirn Participant.
Section L1.5 Years of Vesting Service
Years of Vesting Service shall include all service treated as Vesting Service under the
provisions of the Dunsirn Plan as of December 31, 2001 as well as all service otherwise so treated
under the provisions of the Plan.
Section L9.1 Vesting of Accounts
(a) Each Participants or Merged Participants interest in his Dunsirn Participant Account
shall be Vested at all times provided that
(i) he is an Employee on December 31, 2001, or
L-1
(ii) his employment with the Company was involuntarily terminated as a result of the
acquisition of the stock of Dunsirn Industries, Inc. by the Company effective as of February
1, 2001.
(b) Each Merged Participant who is not described in subsection (a) shall be Vested in his
Dunsirn Participant Account according to the following schedule:
|
|
|
|
|
Years of Vesting Service |
|
Vested Percentage |
less than 2
|
|
|
0 |
% |
2
|
|
|
20 |
% |
3
|
|
|
40 |
% |
4
|
|
|
60 |
% |
5
|
|
|
80 |
% |
6
|
|
|
100 |
% |
Section L9.6 Withdrawals Upon Attainment of Age 59 1/2
A Participant or Merged Participant who remains in the employ of the Company after attaining
age 59 1/2 may elect in accordance with the Rules of the Plan to receive a lump sum withdrawal of all
or any portion of his Dunsirn Accounts.
L-2
SUPPLEMENT M
This Supplement contains provisions which modify and supplement the Plan in order to
effectuate the merger of the RVL Packaging, Inc. Salary Savings Plan (the RVL Packaging Plan)
into the Plan, effective as of December 31, 2003. It shall apply only to Merged Participants from
the RVL Packaging Plan and those who are not Merged Participants only because they are
Participants.
Pursuant to this merger, amounts held in Elective Contribution Accounts and Qualified
Non-Elective Contribution Accounts (if any) established under the RVL Packaging Plan shall be
maintained in a subaccount of the Pre-Tax Savings (PTS) Accounts and the Qualified Accounts
respectively, under the Plan. Amounts held in Matching Contribution Accounts, Non-Matching
Contribution Accounts and Rollover Contribution Accounts established under the RVL Packaging
Plan shall be maintained in the RVL Packaging Matching Account, RVL Packaging Non-Matching
Accounts, and RVL Packaging Rollover Accounts, respectively, under the Plan.
The profit-sharing portion of the Plan shall include the RVL Packaging Non-Matching
Contribution Accounts and RVL Packaging Rollover Accounts.
Section M1.1 Accounts
Accounts of a Participant or Merged Participant shall include his RVL Packaging Accounts.
Section M1.2 Early Retirement Date
Early Retirement Date shall mean the first day of the calendar month coinciding with or next
following the later of the Participants or Merged Participants attainment of age 55 or his
completion of 6 Years of Vesting Service.
Section M1.3 Employee
Employee shall mean for purposes of Section M2.1 of this Supplement M an Employee of RVL
Packaging, Inc., a fully owned subsidiary of Avery Dennison Corporation, who satisfies the
requirements of Section 1.30 of the Plan and would have been eligible to participate in the RVL
Labels Plan had such plan not merged into the Plan.
Section M1.4 Merged Participant
Merged Participant shall include a RVL Packaging Participant.
Section M1.5 RVL Packaging Accounts
RVL Packaging Accounts of a Participant or Merged Participant shall mean his accounts
established under the RVL Packaging Plan, including his RVL Packaging Matching Account, RVL
Packaging Non-Matching Account, and RVL Packaging Rollover Accounts.
M-1
Section M1.6 RVL Packaging Matching Contribution Account
RVL Packaging Matching Contribution Account shall mean the individual account in the Plan
established for a Participant or Merged Participant as a result of the merger of the RVL Packaging
Plan into the Plan effective as of December 31, 2003.
Section M1.7 RVL Packaging Non-Matching Contribution Account
RVL Packaging Non-Matching Contribution Account shall mean the individual account in the
Plan established for a Participant or Merged Participant as a result of the merger of the RVL
Packaging Plan into the Plan effective as of December 31, 2003.
Section M1.8 RVL Packaging Participant
RVL Packaging Participant shall mean any person who is not a Participant in the Plan but was
a participant in the RVL Packaging Plan, for whom the Company maintains RVL Packaging Accounts.
Section M1.9 RVL Packaging Plan
RVL Packaging Plan shall mean the RVL Packaging, Inc. Salary Savings Plan.
Section M1.10 RVL Packaging Rollover Account
RVL Packaging Rollover Account shall mean the individual account in the Plan established for
a Participant or Merged Participant as a result of the merger of the RVL Packaging Plan into the
Plan effective as of December 31, 2003.
Section M1.11 Years of Vesting Service
Years of Vesting Service shall include all service treated as Credited Service under the
provisions of the RVL Packaging Plan as of December 31, 2003 as well as all service otherwise so
treated under the provisions of the Plan. Such Service shall be determined in accordance with the
rules set forth in Reg. Section 1.410(a)-7(f)(2).
Section M2.1 Requirements for Participation
(a) Each Employee on December 31, 2003 who on January 1, 2004 or the first day of the calendar
year quarter following such date
(i) is an Employee
(ii) is not employed in a Bargaining Unit
shall become a Participant on such day.
M-2
Section M9.1 Vesting of Accounts
(a) Each Participants or Merged Participants interest in his RVL Packaging Matching
Contribution Account and RVL Packaging Non-Matching Contribution Account shall be Vested at all
times provided that
(i) he is an Employee on December 31, 2003, or
(ii) his employment with RVL Packaging, Inc. was involuntarily terminated by the
Company before December 31, 2003 as a result of the acquisition of the stock of RVL
Packaging, Inc. by the Company effective as of November 5, 2002.
(b) Each Merged Participant who is not described in subsection (a) shall be Vested in his RVL
Packaging Matching Contribution Account and RVL Packaging Non-Matching Contribution Account
according to the following schedule:
|
|
|
|
|
Years of Vesting Service |
|
Vested Percentage |
less than 2
|
|
|
0 |
% |
|
|
|
|
|
2
|
|
|
20 |
% |
|
|
|
|
|
3
|
|
|
40 |
% |
|
|
|
|
|
4
|
|
|
60 |
% |
|
|
|
|
|
5
|
|
|
80 |
% |
|
|
|
|
|
6
|
|
|
100 |
% |
Section M9.3. Withdrawals from RVL Packaging Rollover Accounts
A Participant who is an Employee may elect in accordance with the Rules of the Plan to make a
lump sum withdrawal of all or any portion of the amount credited to his RVL Packaging Rollover
Account.
Section M9.6 Withdrawals Upon Attainment of Age 59 1/2
A Participant who remains in the employ of the Company after attaining age 59 1/2 may elect in
accordance with the Rules of the Plan to receive a lump sum withdrawal of all or any portion of his
RVL Packaging Accounts.
Section M12.2 Distribution on Death
Upon the death of a Participant, former Participant or Merged Participant, the Vested amount
credited to his RVL Packaging Accounts (as determined under Sections 9.1 and M9.1) shall be paid in
one lump sum not later than December 31 of the calendar year containing the fifth anniversary of
the Participants date of death except as otherwise provided in Section 12.3; provided,
M-3
however, that such Participants Accounts (excluding his Rollover Account to the extent it
consists of rollover contributions described in Code Section 411(a)(11)(D)) exceed $5,000.
Section M15.14 Loans to Participants or Former Participants
(a) A Participant or Merged Participant may borrow against his RVL Packaging Accounts with the
approval of the Administrator in accordance with the provisions of Section 15.14 of the Plan.
M-4
SUPPLEMENT N
This Supplement contains provisions which modify and supplement the Plan in order to
effectuate the merger of the RVL Printed Labels 401(k) Plan (the RVL Labels Plan) into the Plan,
effective as of December 31, 2003. It shall apply only to Merged Participants from the RVL Labels
Plan and those who are not Merged Participants only because they are Participants.
Pursuant to this merger, amounts held in Elective Contribution Accounts and Qualified
Non-Elective Contribution Accounts (if any) established under the RVL Labels Plan shall be
maintained in a subaccount of the Pre-Tax Savings (PTS) Accounts and the Qualified Accounts
respectively, under the Plan. Amounts held in Matching Contribution Accounts, Non-Matching
Contribution Accounts and Rollover Contribution Accounts established under the RVL Labels Plan
shall be maintained in the RVL Labels Matching Account, RVL Labels Non-Matching Accounts, and
RVL Labels Rollover Accounts, respectively, under the Plan.
The profit-sharing portion of the Plan shall include the RVL Labels Non-Matching Contribution
Accounts and RVL Labels Rollover Accounts.
Section N1.1 Accounts
Accounts of a Participant or Merged Participant shall include his RVL Labels Accounts.
Section N1.2 Early Retirement Date
Early Retirement Date shall mean the first day of the calendar month coinciding with or next
following the later of the Participants or Merged Participants attainment of age 55 or his
completion of 6 Years of Vesting Service.
Section N1.3 Employee
Employee shall mean for purposes of Section N2.1 of this Supplement N an Employee of RVL
Printed Labels LLC which is a fully owned subsidiary of RVL Packaging, Inc., a fully owned
subsidiary of Avery Dennison Corporation, who satisfies the requirements of Section 1.30 of the
Plan and would have been eligible to participate in the RVL Labels Plan had such plan not merged
into the Plan.
Section N1.4 Merged Participant
Merged Participant shall include a RVL Labels Participant.
Section N1.5 RVL Labels Accounts
RVL Labels Accounts of a Participant or Merged Participant shall mean his accounts
established under the RVL Labels Plan, including his RVL Labels Matching Account, RVL Labels
Non-Matching Account, and RVL Labels Rollover Accounts.
N-1
Section N1.6 RVL Labels Matching Contribution Account
RVL Labels Matching Contribution Account shall mean the individual account in the Plan
established for a Participant or Merged Participant as a result of the merger of the RVL Labels
Plan into the Plan effective as of December 31, 2003.
Section N1.7 RVL Labels Non-Matching Contribution Account
RVL Labels Non-Matching Contribution Account shall mean the individual account in the Plan
established for a Participant or Merged Participant as a result of the merger of the RVL Labels
Plan into the Plan effective as of December 31, 2003.
Section N1.8 RVL Labels Participant
RVL Labels Participant shall mean any person who is not a Participant in the Plan but was a
participant in the RVL Labels Plan, for whom the Company maintains RVL Labels Accounts.
Section N1.9 RVL Labels Plan
RVL Labels Plan shall mean the RVL Printed Labels 401(k) Plan.
Section N1.10 RVL Labels Rollover Account
RVL Labels Rollover Account shall mean the individual account in the Plan established for a
Participant or Merged Participant as a result of the merger of the RVL Labels Plan into the Plan
effective as of December 31, 2003.
Section N1.11 Years of Vesting Service
Years of Vesting Service shall include all service treated as Credited Service under the
provisions of the RVL Labels Plan as of December 31, 2003 as well as all service otherwise so
treated under the provisions of the Plan. Such Service shall be determined in accordance with the
rules set forth in Reg. Section 1.410(a)-7(f)(2).
Section N2.1 Requirements for Participation
(a) Each Employee on December 31, 2003 who on January 1, 2004 or the first day of the calendar
year quarter following such date
(i) is an Employee
(ii) is not employed in a Bargaining Unit
shall become a Participant on such day.
N-2
Section N9.1 Vesting of Accounts
(a) Each Participants or Merged Participants interest in his RVL Labels Matching
Contribution Account and RVL Labels Non-Matching Contribution Account shall be Vested at all times
provided that
(i) he is an Employee on December 31, 2003, or
(ii) his employment with RVL Printed Labels, LLC was involuntarily terminated by the
Company before December 31, 2003 as a result of the acquisition of the stock of RVL Printed
Labels, LLC by the Company effective as of November 5, 2002.
(b) Each Merged Participant who is not described in subsection (a) shall be Vested in his RVL
Labels Matching Contribution Account and RVL Labels Non-Matching Contribution Account according to
the following schedule:
|
|
|
|
|
Years of Vesting Service |
|
Vested Percentage |
less than 2
|
|
|
0 |
% |
|
|
|
|
|
2
|
|
|
20 |
% |
|
|
|
|
|
3
|
|
|
40 |
% |
|
|
|
|
|
4
|
|
|
60 |
% |
|
|
|
|
|
5
|
|
|
80 |
% |
|
|
|
|
|
6
|
|
|
100 |
% |
Section N9.3. Withdrawals from RVL Labels Rollover Accounts
A Participant who is an Employee may elect in accordance with the Rules of the Plan to make a
lump sum withdrawal of all or any portion of the amount credited to his RVL Labels Rollover
Account.
Section N9.6 Withdrawals Upon Attainment of Age 59 1/2
A Participant who remains in the employ of the Company after attaining age 59 1/2 may elect in
accordance with the Rules of the Plan to receive a lump sum withdrawal of all or any portion of his
RVL Labels Accounts.
Section N12.2 Distribution on Death
Upon the death of a Participant, former Participant or Merged Participant, the Vested amount
credited to his RVL Labels Accounts (as determined under Sections 9.1 and N9.1) shall be paid in
one lump sum not later than December 31 of the calendar year containing the fifth anniversary of
the Participants date of death except as otherwise provided in Section 12.3; provided,
N-3
however, that such Participants Accounts (excluding his Rollover Account to the extent it
consists of rollover contributions described in Code Section 411(a)(11)(D)) exceed $5,000.
Section N15.14 Loans to Participants or Former Participants
(a) A Participant or Merged Participant may borrow against his RVL Labels Accounts with the
approval of the Administrator in accordance with the provisions of Section 15.14 of the Plan.
N-4
SUPPLEMENT O
This Supplement contains provisions which modify and supplement the Plan in order to
effectuate the merger of the Avery Dennison Corporation 401(k) Profit Sharing Retirement Plan (the
L&E Plan) into the Plan, effective as of December 31, 2003. It shall apply only to Merged
Participants from the L&E Plan and those who are not Merged Participants only because they are
Participants.
Pursuant to this merger, amounts held in Elective Accounts and Qualified Non-Elective
Contribution Accounts and/or Qualified Matching Contribution Account (if any) established under
the L&E Plan shall be maintained in a subaccount of the Pre-Tax Savings (PTS) Accounts and the
Qualified Accounts respectively, under the Plan. Amounts held in Matching Accounts,
Discretionary Non-Elective Accounts and Rollover Accounts established under the L&E Plan shall
be maintained in the L&E Matching Account, L&E Discretionary Non-Elective Accounts, and L&E
Rollover Accounts, respectively, under the Plan.
The profit-sharing portion of the Plan shall include the L&E Discretionary Non-Elective
Accounts and L&E Rollover Accounts.
Section O1.1 Accounts
Accounts of a Participant or Merged Participant shall include his L&E Accounts.
Section O1.2 L&E Accounts
L&E Accounts of a Participant or Merged Participant shall mean his accounts established
under the L&E Plan, including his L&E Matching Account, L&E Discretionary Non-Elective Account and
L&E Rollover Accounts.
Section O1.3 L&E Discretionary Non-Elective Account
L&E Discretionary Non-Elective Account shall mean the individual account in the Plan
established for a Participant or Merged Participant as a result of the merger of the L&E Plan into
the Plan effective as of December 31, 2003.
Section O1.4 L&E Matching Account
L&E Matching Account shall mean the individual account in the Plan established for a
Participant or Merged Participant as a result of the merger of the L&E Plan into the Plan effective
as of December 31, 2003.
Section O1.5 L&E Participant
L&E Participant shall mean any person who is not a Participant in the Plan but was a
participant in the L&E Plan, for whom the Company maintains L&E Accounts.
O-1
Section O1.6 L&E Plan
L&E Plan shall mean the Avery Dennison Corporation 401(k) Profit Sharing Retirement Plan.
Section O1.7 L&E Rollover Account
L&E Rollover Account shall mean the individual account in the Plan established for a
Participant or Merged Participant as a result of the merger of the L&E Plan into the Plan effective
as of December 31, 2003.
Section O1.8 Merged Participant
Merged Participant shall include a L&E Participant.
Section O1.9 Years of Vesting Service
Years of Vesting Service shall include all service treated as Year of Service under the
provisions of the L&E Plan as of December 31, 2003 as well as all service otherwise so treated
under the provisions of the Plan. Such Service shall be determined in accordance with the rules
set forth in Reg. Section 1.410(a)-7(f)(2).
Section O9.1 Vesting of Accounts
(a) Each Participants or Merged Participants interest in his L&E Matching Account and L&E
Discretionary Non-Elective Account shall be Vested at all times provided that
(i) he is an Employee on December 31, 2003, or
(ii) his employment with the Company was involuntarily terminated by the Company before
December 31, 2003 as a result of the purchase of assets of L&E Packaging LLC by the Company
effective as of November 5, 2002.
(b) Each Merged Participant who is not described in subsection (a) shall be Vested in his L&E
Matching Account and L&E Discretionary Non-Elective Account according to the following schedule:
O-2
|
|
|
|
|
Years of Vesting Service |
|
Vested Percentage |
less than 2
|
|
|
0 |
% |
|
2
|
|
|
20 |
% |
|
3
|
|
|
40 |
% |
|
4
|
|
|
60 |
% |
|
5
|
|
|
80 |
% |
|
6
|
|
|
100 |
% |
Section O9.6 Withdrawals Upon Attainment of Age 59 1/2
A Participant who remains in the employ of the Company after attaining age 59 1/2 may elect in
accordance with the Rules of the Plan to receive a lump sum withdrawal of all or any portion of his
L&E Accounts.
Section O12.2 Distribution on Death
Upon the death of a Participant, former Participant or Merged Participant, the Vested amount
credited to his L&E Accounts (as determined under Sections 9.1 and O9.1) shall be paid in one lump
sum not later than December 31 of the calendar year containing the fifth anniversary of the
Participants date of death except as otherwise provided in Section 12.3; provided, however,
that such Participants Accounts (excluding his Rollover Account to the extent it consists of
rollover contributions described in Code Section 411(a)(11)(D)) exceed $5,000.
Section O15.14 Loans to Participants or Former Participants
(a) A Participant or Merged Participant may borrow against his L&E Accounts with the approval
of the Administrator in accordance with the provisions of Section 15.14 of the Plan.
O-3
SUPPLEMENT P
This Supplement contains provisions which modify and supplement the Plan in order to
effectuate the merger of the DM Label, Inc. Salary Savings Plan (DM Label Plan) into the Plan,
effective on or about February 2, 2009. It shall apply only to Merged Participants and those who
are not Merged Participants only because they are Participants.
Pursuant to this merger, amounts considered to be Elective Deferral Contributions, Matching
Contributions, Discretionary Contributions and Rollover Contributions established under the DM
Label Plan shall be maintained in DM Label Elective Deferral Contributions Accounts, DM Label
Matching Contributions Accounts, DM Label Discretionary Employer Contributions Accounts and DM
Label Rollover Accounts, under the Plan.
The profit-sharing portion of the Plan shall include the DM Label Discretionary Employer
Contributions Accounts and DM Label Rollover Accounts.
Section P1.1 Accounts
Accounts of a Participant or Merged Participant shall include his DM Label Accounts.
Section P1.2 DM Label Accounts
DM Label Accounts of a Participant or Merged Participant shall mean his accounts established
under the DM Label Plan, including his DM Label Elective Deferral Contributions Account, DM Label
Matching Contributions Account, DM Label Rollover Account and his DM Label Discretionary Employer
Contributions Account.
Section P1.3 DM Label Plan
DM Label Plan shall mean the DM Label, Inc. Salary Savings Plan.
Section P1.4 DM Label Discretionary Employer Contributions Account
DM Label Discretionary Employer Contributions Account shall mean the individual account in
the Plan established for a Participant or Merged Participant as a result of the merger of the DM
Label Plan into the Plan, effective as of the DM Label Merger Date.
Section P1.5 DM Label Elective Deferral Contributions Account
DM Label Elective Deferral Contributions Account shall mean the individual account in the
Plan established for a Participant or Merged Participant as a result of the merger of the DM Label
Plan into the Plan, effective as of the DM Label Merger Date.
P-1
Section P1.6 DM Label Matching Contributions Account
DM Label Matching Contributions Account shall mean the individual account in the Plan
established for a Participant or Merged Participant as a result of the merger of the DM Label Plan
into the Plan, effective as of the DM Label Merger Date.
Section P1.7 DM Label Merger Date
DM Label Merger Date shall mean the date that the DM Label Plan merged with and into the
Plan which is expected to be on or about February 2, 2009.
Section P1.8 DM Label Participant
DM Label Participant shall mean any person who is not a Participant in the Plan but was a
participant in the DM Label Plan, for whom the Company maintains one or more DM Label Accounts.
Section P1.9 DM Label Rollover Account
DM Label Rollover Account shall mean the individual account in the Plan established for a
Participant or Merged Participant as a result of the merger of the DM Label Plan into the Plan,
effective as of the DM Label Merger Date.
Section P1.10 Early Retirement Date
Early Retirement Date shall mean the first day of the calendar month coinciding with or next
following the later of the Participants or Merged Participants fifty-fifth birthday or his
completion of seven Years of Vesting Service.
Section P1.11 Hour of Service
For purposes of Section 1.36, any reference to the Company with respect to periods before
April 1, 2008 shall include DM Label, Inc.
Section P1.12 Merged Participant
Merged Participant shall include a DM Label Participant.
Section P1.13 Totally Disabled
For purposes of Section P9.1(c), Totally Disabled means that a Merged Participant is
disabled prior to the DM Label Merger Date, as a result of sickness or injury, to the extent that
he is prevented from engaging in any substantial gainful activity, and is eligible for an receives
a disability benefit under Title II of the Federal Social Security Act.
P-2
Section P1.14 Years of Vesting Service
Years of Vesting Service shall include all service treated as Vesting Service under the
provisions of the DM Label Plan as of the DM Label Merger Date, as well as all service otherwise so
treated under the provisions of the Plan.
Section P9.1 Vesting of Accounts
(a) Each Participants or Merged Participants interest in his DM Label Discretionary Employer
Contributions Account and DM Label Matching Contributions Account shall be Vested at all times
provided that he is an Employee on the December 31, 2008.
(b) Each Merged Participant not described in subsection (a), shall be Vested in his DM Label
Discretionary Employer Contributions Account and DM Label Matching Contributions Account according
to the following schedule:
|
|
|
|
|
Years of Vesting Service |
|
Vested Percentage |
Less than 2
|
|
|
0 |
|
|
2
|
|
|
20 |
% |
|
3
|
|
|
40 |
% |
|
4
|
|
|
60 |
% |
|
5
|
|
|
80 |
% |
|
6
|
|
|
100 |
% |
(c) The interest of a Merged Participant described in paragraph (b) in his DM Label
Discretionary Employer Contributions Account and DM Label Matching Contributions Account shall
become fully Vested upon the earliest to occur of
(i) his death,
(ii) his sixty-fifth birthday,
(iii) the date he becomes Totally Disabled prior to the DM Label Merger Date, or
(iv) the termination or discontinuation of the Plan under Section 16.1,
if he is then an affected Employee or employed by a Company Affiliate.
Section P9.2 Unrestricted Withdrawals
(a) An active or inactive Participant or Merged Participant may elect in accordance with the
Rules of the Plan and not more than twice in any 12-month period to make a lump sum withdrawal of
all or any portion of the amount credited to his DM Label Rollover Account.
P-3
(b) A Participant or Merged Participant may elect to start to receive his DM Label Accounts
upon his Normal Retirement Date in accordance with Article XI, even if he continues to be an
Employee.
Section P9.6 Withdrawals Upon Attainment of Age 591/2
An active or inactive Participant or Merged Participant who has attained age 591/2 may elect at
any time and in accordance with the Rules of the Plan to make a lump sum withdrawal of all or any
portion of the amount credited to his DM Label Accounts.
Section P15.14 Loans to Participants or Former Participants
(a) A Participant or Merged Participant may borrow against his DM Label Accounts with the
approval of the Administrator in accordance with the provisions of subsection (b).
P-4
EXHIBIT 1
Effective Dates
The provisions of the Plan are generally effective December 1, 2004 unless otherwise provided
in the Plan. However, the provisions set forth below are effective as follows:
|
|
|
Sections |
|
Effective Date |
All Sections reflecting the final
Treasury Regulations under Code
Section 401(k), including, but not
limited to Sections 1.34(a)(v),
1.34(a)(vi), 3.5(b) and 6.11(b).
|
|
December 1, 2006 |
|
|
|
Sections 1.6(a), 1.28, 1.29(c), 1.64,
6.10, 15.4, 9.5(a), 18.4
|
|
December 1, 2007 |
|
|
|
Sections 1.7, 1.19(a), 1.21A,
1.29(b)(v), 1.29(d), 1.36(d) and (e),
1.77, 9.4(g), 11.4(d), 15.4(b)(viii)
|
|
January 1, 2009 |
|
|
|
Sections 1.25 and 2.3
|
|
January 1, 2010 |
|
|
|
Sections 1.30(a)(v), 1.37 and Exhibit 4
|
|
December 2, 2009 |
|
|
|
Section 1.51
|
|
December 31, 2008 |
|
|
|
Section 1.62
|
|
January 4, 2005 |
|
|
|
Section 2.1(b)
|
|
July 1, 2006 |
|
|
|
Sections 3.1(a)(i)(A)1, 3.1(d),
4.1(a), 4.1(g), 14.1(b)(vi)c
|
|
December 1, 2002 |
|
|
|
Sections 1.60(b)(ii) and I8.1(c) of
Supplement I
|
|
December 1, 2004 |
|
|
|
Section 2.3 and Exhibit 5
|
|
July 1, 2000 |
|
|
|
Sections 2.2, 3.1(c), 4.1(b) and 6.3(b)
|
|
First payroll period beginning on or
after January 1, 2009 |
|
|
|
Sections 3.1(a)(i)B, 3.5(b)(iv) and
(v), 6.11(b)(v) and Exhibit 6
|
|
December 1, 2008 |
|
|
|
The reduction of the automatic cash
out amount in Sections 11.3(a),
11.3(b), 13.1(a), 13.1(b) (and
corresponding Sections in the
Supplements) from $5,000 to $1,000 and
Section 15.17.
|
|
March 28, 2005 |
Ex. 1-1
|
|
|
Sections |
|
Effective Date |
Sections 6.10, A6.10, E6.10, F6.10 and
H6.10.
|
|
July 1, 2005 |
|
|
|
Section 7.5
|
|
June 1, 2009 |
|
|
|
Section 9.1(c)(i)
|
|
Effective for deaths occurring on or
after January 1, 2007 |
|
|
|
Sections 9.3(a), 9.4(a), 9.4(h)
|
|
April 1, 2004 |
|
|
|
Section 9.4(f)
|
|
August 1, 2008 |
|
|
|
Section E6.10 and F6.10 (the reference
to Participant in these Sections was
changed to Active Participant)
|
|
For diversification elections after 2006. |
|
|
|
Supplement P
|
|
On or about February 2, 2009 |
Ex. 1-2
EXHIBIT 2
CURRENT YEAR TESTING METHOD ELECTION
The Company hereby makes the Current Year Testing Method Election as described in Section
3.5(a) and/or 6.11(a) which election shall apply for all subsequent Plan Years unless revoked by
the Company as set forth below:
|
|
|
Plan Year |
|
Application |
1997
|
|
Section 3.5(a) and 6.11(a) |
The Company hereby revokes the Current Year Testing Method Election as permitted by Treas.
Reg. Section 1.401(k)-2(c):
Ex. 2-1
EXHIBIT 3
SPECIAL VESTING FOR AFFECTED PARTICIPANTS
Section 9.1(d)
1. All employees at Specialty Papers (Framingham, MA) and Transformer Materials Corporation shall
be fully vested in their Accounts on the date of the sale to Wicor on November 9, 2001 regardless
of their Years of Vesting Service.
2. All employees of the Dec Tech division of Avery Dennison Corporation shall be fully vested in
their Accounts on the date of the sale of this division to Multi Color on January 17, 2003
regardless of their Years of Vesting Service.
3. All employees of Stimsonite Corporation on the day before the date of the sale of Stimsonite
Corporation to Ennis Paint, Inc. (the Sale) who do not continue employment with the Company on or
after the Sale shall be fully vested in their Accounts on the date of the Sale.
Ex. 3-1
EXHIBIT 4
EMPLOYEES WHO ARE NOT ELIGIBLE TO BECOME PARTICIPANTS
AND EFFECTIVE DATE
Section 1.30(a)(v)
|
|
|
Description (or Name) of Ineligible Employees
|
|
Effective Date |
|
|
|
INDIVIDUALS WHO ARE INCLUDED AFFILIATE EMPLOYEES
Section 1.37
|
|
|
Description (or Name) of Included Affiliate Employees
|
|
Effective Date |
|
|
|
Ex. 4-1
EXHIBIT 5
PRE-TAX AND AFTER-TAX CONTRIBUTIONS
I. AUTOMATIC ENROLLMENT PERCENTAGES FOR PRE-TAX CONTRIBUTIONS
Section 2.2 (Effective July 1, 2000)
|
|
|
Automatic Deferral Percentage |
|
Effective Date |
3%
|
|
July 1, 2000 June 30, 2001 |
4%
|
|
July 1, 2001 June 30, 2004 |
5%
|
|
July 1, 2004 June 30, 2006 |
6%
|
|
July 1, 2006 |
Section 2.2(a) (Effective as of the first payroll period beginning on or after January 1,
2009)
|
|
|
Automatic Deferral Percentage |
|
Effective Date |
6%
|
|
First payroll period beginning on or after
January 1, 2009 |
II. LIMITATIONS ON PRE-TAX AND AFTER-TAX CONTRIBUTIONS
Section 3.1(d)(i)
|
|
|
Limit for Pre-Tax and After-Tax Contributions |
|
Effective Date |
1 16%
|
|
December 1, 2002 November 30, 2004 |
1 25%
|
|
December 1, 2004 |
Section 3.1(d)(ii)
|
|
|
Highly Compensated Employee Limit |
|
|
for Pre-Tax Contributions |
|
Effective Date |
1 6%
|
|
December 1, 2002 November 30, 2004 |
1 7%
|
|
December 1, 2004 |
Ex. 5-1
EXHIBIT 6
ESOP REQUIREMENTS
|
|
|
1. Buy-Sell Agreements to Acquire Securities.
|
|
The ESOP portion of the Plan must not obligate
itself to acquire securities from a particular
security holder at an indefinite time determined
upon the happening of an event such as the death of
the holder, as described in Treas. Reg. Section
54.4975-11(a)(7)(i). |
|
|
|
2. Reasonable Rate of Interest for ESOP Loan.
|
|
The interest rate of any loan (within the meaning
of Treas. Reg. Section 54.4975-7(b)(1)(ii)) must
not be in excess of a reasonable rate of interest,
as described in Treas. Reg. Section
54.4975-7(b)(7). |
|
|
|
3. Specific Term for ESOP Loan.
|
|
Any exempt loan (within the meaning of Treas. Reg.
Section 54.4975-7(b)(1)(iii)) must be for a
specific term and may not be payable at the demand
of any person, except in the case of default, as
described in Treas. Reg. Section 54.4975-7(b)(13). |
|
|
|
4. Primary Benefit Requirement for ESOP Loan.
|
|
Any exempt loan (within the meaning of Treas. Reg.
Section 54.4975-7(b)(1)(iii)) must be primarily for
the benefit of the ESOP Participants and their
Beneficiaries, as described in Treas. Reg. Section
54.4975-7(b)(3)(i). |
|
|
|
5. An ESOP Loans Interest Rate and its Net Effect on Plan Assets.
|
|
At the time any loan (within the meaning of Treas.
Reg. Section 54.4975-7(b)(1)(ii)) is made, the
interest rate for the loan and the price of
securities to be acquired with the loan proceeds
should not be such that Plan assets might be
drained off, as described in Treas. Reg. Section
54.4975-7(b)(3)(ii). |
|
|
|
6. Use of ESOP Loan Proceeds.
|
|
The proceeds of any exempt loan (within the meaning
of Treas. Reg. Section 54.4975-7(b)(1)(iii)) must
be used within a reasonable time after their
receipt by the borrowing ESOP portion of the Plan
only for any or all of the following purposes: |
|
|
(i) To acquire qualifying employer securities
(within the meaning of Treas. Reg. Section
54.4975-7(b)(1)(v));
(ii) To repay such loan, or
(iii) To repay a prior exempt loan,
as described in Treas. Reg. Section 54.4975-7(b)(4). |
|
7. Collateral for ESOP Loan.
|
|
The only assets of the ESOP that may be given as
collateral on an exempt loan are (i) qualifying
employer securities (within the meaning of Treas.
Reg. Section |
Ex. 6-1
|
|
|
|
|
54.4975-7(b)(1)(v)) acquired with the
proceeds of the loan and (ii) those that were used
as collateral on a prior exempt loan repaid with
the proceeds of the current exempt loan, as
described in Treas. Reg. Section 54.4975-7(b)(5). |
|
|
|
8. Right to Assets under ESOP Loan.
|
|
No person entitled to payment under the exempt loan
shall have any right to assets of the ESOP other
than: |
|
|
(i) Collateral given for the loan,
(ii) Contributions (other than contributions of
employer securities) that are made under an ESOP to
meet its obligations under the loan, and
(iii) Earnings attributable to such collateral and
the investment of such contributions, as described
in Treas. Reg. Section 54.4975-7(b)(5). |
|
|
|
9. Separate Accounting for ESOP
Contributions and Earnings.
|
|
The payments made with respect to an exempt loan by
the ESOP during a Plan Year must not exceed an
amount equal to the sum of such contributions and
earnings received during or prior to the year less
such payments in prior years. Such contributions
and earnings must be accounted for separately in
the books of account of the ESOP until the loan is
repaid, as described in Treas. Reg. Section
54.4975-7(b)(5). |
|
|
|
10. ESOP Loan Default.
|
|
In the event of default upon an exempt loan, the
value of Plan assets transferred in satisfaction of
the loan must not exceed the amount of default. If
the lender is a disqualified person, a loan must
provide for a transfer of Plan assets upon default
only upon and to the extent of the failure of the
Plan to meet the payment schedule of the loan, as
described in Treas. Reg. Section 54.4975-7(b)(6). |
|
|
|
11. Assets Withdrawn from Suspense Account.
|
|
The ESOP must consistently allocate to the
Participants ESOP Accounts non-monetary units
representing Participants interests in assets
withdrawn from the Suspense Account, as described
in Treas. Reg. Section 54.4975-11(d)(2). |
|
|
|
Ex. 6-2
|
|
|
12. Forfeitures from ESOP Accounts.
|
|
If a portion of a Participants ESOP Account is
forfeited, qualifying employer securities allocated
in #11 above must be forfeited only after other
assets. If interests in more than one class of
qualifying employer securities have been allocated
to the Participants ESOP Account, the Participant
must be treated as forfeiting the same proportion
of each such class, as described in Treas. Reg.
Section 54.4975-11(d)(4). |
|
|
|
13. ESOP Loan Proceeds.
|
|
If securities acquired with the proceeds of an
exempt loan available for distribution consist of
more than one class, a distributee must receive
substantially the same proportion of each such
class, as described in Treas. Reg. Section
54.4975-11(f)(2). |
Ex. 6-3
2007 AMENDMENT AND RESTATEMENT OF
AVERY DENNISON CORPORATION
EMPLOYEE SAVINGS PLAN
TABLE OF CONTENTS
|
|
|
|
|
|
|
Page |
|
Preamble |
|
|
1 |
|
|
|
|
|
|
ARTICLE I. DEFINITIONS |
|
|
2 |
|
|
|
|
|
|
Section 1.1. General |
|
|
2 |
|
Section 1.2. Accounts |
|
|
2 |
|
Section 1.3. Active Participant |
|
|
3 |
|
Section 1.4. Administrator |
|
|
3 |
|
Section 1.5. After-Tax Savings (ATS) Account |
|
|
3 |
|
Section 1.6. Annual Addition |
|
|
3 |
|
Section 1.7. Bargaining Unit |
|
|
4 |
|
Section 1.8. Basic ATS Account |
|
|
5 |
|
Section 1.9. Basic PTS Account |
|
|
5 |
|
Section 1.10. Beneficiary |
|
|
5 |
|
Section 1.11. Board |
|
|
5 |
|
Section 1.12. Break in Service Year |
|
|
5 |
|
Section 1.13. Cash Account |
|
|
6 |
|
Section 1.14. Catch-Up Eligible Participant |
|
|
6 |
|
Section 1.15. Code |
|
|
6 |
|
Section 1.16. Company; Company Affiliate |
|
|
6 |
|
Section 1.17. Company Stock |
|
|
6 |
|
Section 1.18. Company Stock Fund |
|
|
7 |
|
Section 1.19. Compensation |
|
|
7 |
|
Section 1.20. Contribution Percentage |
|
|
8 |
|
Section 1.21. Current Obligations |
|
|
8 |
|
Section 1.21A DB Eligible Participant |
|
|
9 |
|
Section 1.22. Deferral Percentage |
|
|
9 |
|
Section 1.23. Deferred Compensation |
|
|
9 |
|
Section 1.24. Direct Rollover |
|
|
9 |
|
Section 1.25. Distributee |
|
|
9 |
|
Section 1.26. Disability Retirement |
|
|
10 |
|
Section 1.27. Disability Retirement Date |
|
|
10 |
|
Section 1.28. Eligible Retirement Plan |
|
|
10 |
|
Section 1.29. Eligible Rollover Distribution |
|
|
11 |
|
Section 1.30. Employee; Leased Employee |
|
|
12 |
|
Section 1.31. ERISA |
|
|
13 |
|
Section 1.32. ESOP Account |
|
|
13 |
|
Section 1.33. [Reserved.] |
|
|
13 |
|
Section 1.34. Hardship |
|
|
13 |
|
Section 1.35. Highly Compensated Employee |
|
|
14 |
|
i
|
|
|
|
|
|
|
Page |
|
Section 1.36. Hour of Service |
|
|
15 |
|
Section 1.37. Included Affiliate Employee |
|
|
16 |
|
Section 1.38. Leveling Method |
|
|
16 |
|
Section 1.39. Leveraged Company Stock |
|
|
17 |
|
Section 1.40. Merged Participant |
|
|
17 |
|
Section 1.41. Merger |
|
|
17 |
|
Section 1.42. Military Leave |
|
|
17 |
|
Section 1.43. Normal Retirement |
|
|
17 |
|
Section 1.44. Normal Retirement Date |
|
|
17 |
|
Section 1.45. Option Stock |
|
|
18 |
|
Section 1.46. Participant |
|
|
18 |
|
Section 1.47. Pay |
|
|
18 |
|
Section 1.48. Payday |
|
|
18 |
|
Section 1.49. Plan |
|
|
18 |
|
Section 1.50. Plan Representative |
|
|
18 |
|
Section 1.51. Plan Year |
|
|
18 |
|
Section 1.52. Pretax Savings (PTS) Account |
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18 |
|
Section 1.53. Qualified Account |
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18 |
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Section 1.54. Qualified Holder |
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19 |
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Section 1.55. Qualified Matching Account |
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19 |
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Section 1.56. Qualified Non-Matching Account |
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19 |
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Section 1.57. Rollover Account |
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19 |
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Section 1.58. Rules of the Plan |
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19 |
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Section 1.59. Savings Plan |
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19 |
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Section 1.60. Separation from the Service |
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19 |
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Section 1.61. Service |
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20 |
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Section 1.62. Spousal Consent |
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20 |
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Section 1.63. Spouse; Surviving Spouse |
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20 |
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Section 1.64. Statutory Compensation |
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21 |
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Section 1.65. Stock Account |
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23 |
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Section 1.66. Subfund |
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23 |
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Section 1.67. Supplement |
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23 |
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Section 1.68. Suspense Account |
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23 |
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Section 1.69. Trust |
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23 |
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Section 1.70. Trust Agreement |
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23 |
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Section 1.71. Trust Fund |
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24 |
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Section 1.72. Trustee |
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24 |
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Section 1.73. Unmatched ATS Account |
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24 |
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Section 1.74. Unmatched PTS Account |
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24 |
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Section 1.75. Valuation Date |
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24 |
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Section 1.76. Vested |
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24 |
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Section 1.77. Years of Vesting Service |
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24 |
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ARTICLE II. ELIGIBILITY |
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25 |
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Section 2.1. Requirements for Participation |
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25 |
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Section 2.2. Automatic Enrollment |
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25 |
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Section 2.3. Notice of Right to Receive Cash and Election |
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26 |
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ii
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Page |
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Section 2.4. Inactive Status |
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26 |
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ARTICLE III. PRETAX SAVINGS CONTRIBUTIONS |
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27 |
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Section 3.1. PTS Contributions |
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27 |
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Section 3.2. Suspension of Deferral |
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28 |
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Section 3.3. Commencement, Resumption or Change of Deferred Compensation |
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28 |
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Section 3.4. Deposit in Trust |
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29 |
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Section 3.5. Deferral Percentage Fail-Safe Provisions |
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29 |
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ARTICLE IV. AFTER-TAX SAVINGS CONTRIBUTIONS |
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30 |
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Section 4.1. ATS Contributions |
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30 |
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Section 4.2. Change, Commencement, Discontinuance or Resumption of ATS Contributions |
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31 |
|
Section 4.3. Withholding of ATS Contributions |
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31 |
|
Section 4.4. ATS Account |
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31 |
|
Section 4.5. Deposit in Trust |
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31 |
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ARTICLE V. CONTRIBUTIONS OF THE COMPANY |
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32 |
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Section 5.1. Determination of Annual Contribution |
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32 |
|
Section 5.2. Maximum Annual Contribution |
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32 |
|
Section 5.3. Contribution Date |
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32 |
|
Section 5.4. Form of Contributions |
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33 |
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ARTICLE VI. PARTICIPATION IN COMPANY CONTRIBUTIONS AND FORFEITURES |
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33 |
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Section 6.1. PTS Account |
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33 |
|
Section 6.2. ESOP Account; Qualified Account |
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33 |
|
Section 6.3. Allocation of Company Contributions and ESOP Stock |
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33 |
|
Section 6.4. Allocation of Cash Dividends |
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34 |
|
Section 6.5. Allocation of Stock Dividends |
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35 |
|
Section 6.6. [Reserved] |
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35 |
|
Section 6.7. Suspense Account |
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35 |
|
Section 6.8. Release and Allocation of Leveraged Company Stock |
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35 |
|
Section 6.9. Application of Forfeitures |
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36 |
|
Section 6.10. Diversification |
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36 |
|
Section 6.11. Contribution Percentage Fail-Safe Provisions |
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37 |
|
Section 6.12. Reemployment Rights after Qualified Military Service |
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38 |
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ARTICLE VII. INVESTMENT OF ACCOUNTS |
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|
40 |
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Section 7.1. Subfunds |
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40 |
|
Section 7.2. Investment of New Contributions |
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41 |
|
Section 7.3. Investment Transfers |
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41 |
|
Section 7.4. Transfer of Assets |
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41 |
|
Section 7.5. Effect of Non-Election |
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41 |
|
iii
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Page |
|
ARTICLE VIII. VALUATION OF THE TRUST FUND AND ACCOUNTS |
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|
41 |
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Section 8.1. Determination of Values |
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41 |
|
Section 8.2. Allocation of Values |
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42 |
|
Section 8.3. Applicability of Account Values |
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43 |
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|
ARTICLE IX. VESTING AND WITHDRAWALS |
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|
43 |
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|
Section 9.1. Vesting of Accounts |
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43 |
|
Section 9.2. Unrestricted Withdrawals |
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43 |
|
Section 9.3. Restricted Withdrawals |
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|
44 |
|
Section 9.4. Conditions for Hardship Withdrawal |
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44 |
|
Section 9.5. Withdrawal by Reason of Contribution Limitations |
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45 |
|
Section 9.6. Withdrawals Upon Attainment of Age Fifty-Nine and One Half |
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46 |
|
Section 9.7. Qualified Accounts and Stock Accounts |
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46 |
|
Section 9.8. Withdrawals from Subfunds |
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|
46 |
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|
ARTICLE X. EMPLOYMENT AFTER NORMAL RETIREMENT DATE |
|
|
46 |
|
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|
Section 10.1. Continuation of Employment |
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46 |
|
Section 10.2. Continuation of Participation |
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47 |
|
Section 10.3. Mandatory In-Service Distributions |
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|
47 |
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|
ARTICLE XI. BENEFITS UPON RETIREMENT |
|
|
47 |
|
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|
Section 11.1. Normal or Disability Retirement |
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|
47 |
|
Section 11.2. Rights Upon Normal or Disability Retirement |
|
|
47 |
|
Section 11.3. Distribution of Accounts |
|
|
47 |
|
Section 11.4. Distribution Requirements |
|
|
49 |
|
|
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|
|
|
ARTICLE XII. BENEFITS UPON DEATH |
|
|
51 |
|
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|
|
|
Section 12.1. Designation of Beneficiary |
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|
51 |
|
Section 12.2. Distribution on Death |
|
|
52 |
|
Section 12.3. Election of Other Payment Methods |
|
|
52 |
|
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|
|
ARTICLE XIII. BENEFITS UPON RESIGNATION OR DISCHARGE |
|
|
53 |
|
|
|
|
|
|
Section 13.1. Distributions on Resignation or Discharge |
|
|
53 |
|
Section 13.2. Forfeitures |
|
|
54 |
|
Section 13.3. Restoration of Forfeitures |
|
|
55 |
|
|
|
|
|
|
ARTICLE XIV. TOP-HEAVY PROVISIONS |
|
|
55 |
|
|
|
|
|
|
Section 14.1. Top-Heavy Determination |
|
|
55 |
|
Section 14.2. Minimum Benefits |
|
|
57 |
|
Section 14.3. Vesting |
|
|
58 |
|
iv
|
|
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|
Page |
|
ARTICLE XV. ADMINISTRATIVE PROVISIONS |
|
|
59 |
|
|
|
|
|
|
Section 15.1. Duties and Powers of the Administrator |
|
|
59 |
|
Section 15.2. Expenses of Administration |
|
|
60 |
|
Section 15.3. Payments |
|
|
60 |
|
Section 15.4. Statement to Participants |
|
|
60 |
|
Section 15.5. Inspection of Records |
|
|
61 |
|
Section 15.6. Claims Procedure |
|
|
61 |
|
Section 15.7. Conflicting Claims |
|
|
62 |
|
Section 15.8. Effect of Delay or Failure to Ascertain Amount Distributable or to Locate
Distributee |
|
|
62 |
|
Section 15.9. Service of Process |
|
|
63 |
|
Section 15.10. Limitations Upon Powers of the Administrator |
|
|
63 |
|
Section 15.11. Effect of Administrator Action |
|
|
63 |
|
Section 15.12. Contributions to Rollover Accounts |
|
|
63 |
|
Section 15.13. Transfers to Rollover Accounts |
|
|
64 |
|
Section 15.14. Loans to Participants or Former Participants |
|
|
64 |
|
Section 15.15. Distributions Pursuant to Qualified Domestic Relations Orders and Certain
Offsets |
|
|
67 |
|
Section 15.16. Correction of Administrative Error; Special Contribution |
|
|
67 |
|
Section 15.17. Direct Rollovers |
|
|
68 |
|
|
|
|
|
|
ARTICLE XVI. TERMINATION, DISCONTINUANCE, AMENDMENT, MERGER, ADOPTION OF PLAN |
|
|
68 |
|
|
|
|
|
|
Section 16.1. Termination of Plan; Discontinuance of Contributions |
|
|
68 |
|
Section 16.2. Amendment of Plan |
|
|
69 |
|
Section 16.3. Retroactive Effect of Plan Amendment |
|
|
69 |
|
Section 16.4. Consolidation or Merger; Adoption of Plan by Other Companies |
|
|
69 |
|
|
|
|
|
|
ARTICLE XVII. SALE OF COMPANY STOCK |
|
|
70 |
|
|
|
|
|
|
Section 17.1. Option to Sell Shares of Company Stock |
|
|
70 |
|
|
|
|
|
|
ARTICLE XVIII. MISCELLANEOUS PROVISIONS |
|
|
71 |
|
|
|
|
|
|
Section 18.1. Identification of Fiduciaries |
|
|
71 |
|
Section 18.2. Allocation of Fiduciary Responsibilities |
|
|
72 |
|
Section 18.3. Limitation on Rights of Employees |
|
|
73 |
|
Section 18.4. Limitation on Annual Additions; Treatment of Otherwise Excessive Allocations |
|
|
73 |
|
Section 18.5. Voting Rights |
|
|
73 |
|
Section 18.6. Delays in Payment |
|
|
74 |
|
Section 18.7. Restriction on Leveraged Company Stock |
|
|
74 |
|
Section 18.8. Governing Law |
|
|
74 |
|
Section 18.9. Genders and Plurals |
|
|
75 |
|
Section 18.10. Titles |
|
|
75 |
|
Section 18.11. References |
|
|
75 |
|
v
SUPPLEMENT A
SUPPLEMENT B
SUPPLEMENT C
SUPPLEMENT D
SUPPLEMENT E
SUPPLEMENT F
SUPPLEMENT G
SUPPLEMENT H
SUPPLEMENT I
SUPPLEMENT J
SUPPLEMENT K
SUPPLEMENT L
SUPPLEMENT M
SUPPLEMENT N
SUPPLEMENT O
SUPPLEMENT P
EXHIBIT 1
EXHIBIT 2
EXHIBIT 3
EXHIBIT 4
EXHIBIT 5
EXHIBIT 6
vi