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EXHIBIT 10(d)
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DeVRY INC. PROFIT SHARING RETIREMENT PLAN
-----------------------------------------
(As Amended and Restated Effective as of July 1, 1992)
Mayer, Brown & Platt
Chicago
177
I, , Secretary of Keller
Graduate School of Management, Inc., hereby certify that the
attached document is a full, true and complete copy of DeVRY INC.
PROFIT SHARING RETIREMENT PLAN, as presently in effect.
Dated this day of , 1992.
----------------------
Secretary as Aforesaid
(SEAL)
178
TABLE OF CONTENTS
PAGE
----
SECTION 1 General 1
1.1. History, Purpose and Effective Date 1
1.2. Related Companies and Employers 1
1.3. Trust Agreement, Plan Administration 1
1.4. Plan Year 2
1.5. Valuation Date 2
1.6. Applicable Laws 2
1.7. Gender and Number 2
1.8. Notices 2
1.9. Form and Time of Elections 2
1.10. Evidence 2
1.11. Action by Employers 2
1.12. No Reversion to Employers 3
1.13. Plan Supplements 3
1.14. Defined Terms 3
SECTION 2 Participation in Plan 4
2.1. Eligibility for Participation 4
2.2. Inactive Participation 4
2.3. Plan Not Contract of Employment 4
2.4. Leased Employees 5
SECTION 3 Service 6
3.1. Year of Service 6
3.2. Hour of Service 6
3.3. One Year Break in Service 7
SECTION 4 Pre-Tax and Rollover Contributions 8
4.1. Amount of Pre-Tax Contributions 8
4.2. Payment of Pre-Tax Contributions 8
4.3. Variation, Discontinuance and Resumption of
Pre-Tax Contributions 8
4.4. Rollover Contributions and Transfers 8
4.5. Compensation 9
SECTION 5 Employer Contributions 10
5.1. Matching Contributions 10
5.2. Discretionary Profit Sharing Contributions 10
5.3. Limitations on Amount of Employer Contributions 10
5.4. Payment of Employer Contributions 10
179
SECTION 6 Investment of the Trust Fund 11
6.1. Investment Funds 11
6.2. Investment Fund Accounting 12
6.3. Investment Fund Elections 12
6.4. Transfers Between Investment Funds 12
SECTION 7 Plan Accounting 13
7.1. Participants' Accounts 13
7.2. Adjustment of Participants' Accounts 13
7.3. Allocation and Crediting of Contributions and
Forfeitures 15
7.4. Statement of Plan Interest 16
SECTION 8 Limitations on Compensation, Contributions
and Allocations 17
8.1. Reduction of Contribution Rates 17
8.2. Limitations on Annual Additions 17
8.3. Excess Annual Additions 18
8.4. Combined Plan Limitation 18
8.5. $7,000 Limitation 18
8.6. Code Section 401(k)(3) Testing 19
8.7. Correction Under Section 401(k) Test 21
8.8. Code Section 401(m)(2) Testing 21
8.9. Correction Under Section 401(m) Test 22
8.10. Multiple Use of Alternative Limitation 23
8.11. Highly Compensated 23
8.12. Plan Disaggregation 24
SECTION 9 Vesting and Termination Dates 25
9.1. Determination of Vested Interest 25
9.2. Accelerated Vesting 25
9.3. Termination Date 25
9.4. Distribution Only Upon Separation From Service 25
SECTION 10 Loans and Withdrawals of Contributions While
Employed 27
10.1. Loans to Participants 27
10.2. Withdrawals on Account of Hardship 29
10.3. Hardship Withdrawals 30
10.4. Withdrawals On or After Age 59-1/2 31
10.5. Form of Withdrawal 31
SECTION 11 Distributions 33
11.1. Distributions to Participants After Termination
of Employment 33
180
11.2. Direct Rollover 34
11.3. Distributions to Beneficiaries 34
11.4. Special Rules Governing Annuity Elections 35
11.5. Limits on Commencement and Duration of
Distributions 36
11.6. Beneficiary Designations 38
11.7. Facility of Payment 39
11.8. Interests Not Transferable 39
11.9. Absence of Guaranty 39
11.10. Missing Participants or Beneficiaries 40
11.11. Treatment of Nonvested and Partially Vested
Accounts 40
11.12. Application of Forfeitures 41
11.13. Form of Payment 41
11.14. Disability Distribution 41
SECTION 12 The Committee 42
12.1. Membership and Authority 42
12.2. Allocation and Delegation of Committee
Responsibilities and Powers 43
12.3. Uniform Rules 43
12.4. Information to be Furnished to Committee 43
12.5. Committee's Decision Final 43
12.6. Exercise of Committee's Duties 43
12.7. Remuneration and Expenses 44
12.8. Indemnification of the Committee 44
12.9. Resignation or Removal of Committee Member 44
12.10. Appointment of Successor Committee Members 44
SECTION 13 Amendment and Termination 45
13.1. Amendment 45
13.2. Termination 45
13.3. Merger and Consolidation of the Plan, Transfer
of Plan Assets 45
13.4. Distribution on Termination and Partial
Termination 46
13.5. Notice of Amendment, Termination or Partial
Termination 46
Appendix A - Defined Terms
Supplement A - Top Heavy
181
DeVRY INC. PROFIT SHARING RETIREMENT PLAN
-----------------------------------------
(As Amended and Restated Effective as of July 1, 1992)
SECTION 1
General
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1.1. History, Purpose and Effective Date. Effective
June 30, 1979, Keller Graduate School of Management, Inc., a
Delaware corporation (the "Company"), established the Keller
Graduate School of Management, Inc. Profit Sharing Plan (the
"Plan") so that it, and each Related Company (as defined in
subsection 1.2) which, with the consent of the Company, adopts
the Plan may assist their eligible employees in providing for
their future security. The Plan was amended and restated
effective as of July 1, 1987. Effective as of July 1, 1991, the
Plan was renamed the DeVRY Inc. Profit Sharing Retirement Plan.
The following provisions constitute an amendment, restatement and
continuation of the Plan as in effect immediately prior to July
1, 1992, the "Effective Date" of the Plan as set forth herein.
To the extent that any provisions of the Plan as set forth herein
specifically provide for an effective date prior to July 1, 1992,
such provisions shall constitute an amendment of the Plan as in
effect on such date. The Plan is intended to qualify as a profit
sharing plan under section 401(a) of the Internal Revenue Code of
1986, as amended (the "Code").
1.2. Related Companies and Employers. The term "Related
Company" means any corporation or trade or business during any
period during which it is, along with the Company, a member of a
controlled group of corporations or a controlled group of trades
or businesses, as described in sections 414(b) and 414(c),
respectively, of the Code. The Company and each Related Company,
which, with the Company's consent, adopts the Plan are referred
to below collectively as the "Employers" and individually as an
"Employer".
1.3. Trust Agreement, Plan Administration. All contribu
tions made under the Plan will continue to be held, managed and
controlled by one or more trustees (the "Trustee") acting under a
Trust which forms a part of the Plan. The terms of the Trust as
in effect on the Effective Date are set forth in a Trust
Agreement known as DeVRY Inc. Profit Sharing Retirement Trust.
The authority to control and manage the operation and
administration of the Plan is vested in a committee (the
"Committee") which consists of one or more persons as described
in subsection 12.1. The members of the Committee shall be the
"named fiduciaries", as described in section 402 of the Employee
182
Retirement Income Security Act of 1974, as amended ("ERISA"),
with respect to their authority under the Plan. Except as
otherwise expressly provided in subsection 12.1, the Company
shall be the administrator of the Plan and shall have the rights,
duties and obligations of an "administrator" as that term is
defined in section 3(16)(A) of ERISA and of a "plan
administrator" as that term is defined in section 414(g) of the
Code.
1.4. Plan Year. The term "Plan Year" means the twelve-
consecutive-month period beginning on each July 1.
1.5. Valuation Date. Effective August 1, 1993, the term
"Valuation Date" means the last day of each calendar month. From
the period July 1, 1992 until July 31, 1993, the term "Valuation
Date" means the last day of each calendar quarter.
1.6. Applicable Laws. The Plan shall be construed and
administered in accordance with the internal laws of the State of
Illinois to the extent that such laws are not preempted by the
laws of the United States of America.
1.7. Gender and Number. Where the context admits, words
in any gender shall include any other gender, words in the
singular shall include the plural and the plural shall include
the singular.
1.8. Notices. Any notice or document required to be filed
with the Committee under the Plan will be properly filed if
delivered or mailed by registered mail, postage prepaid, to the
Committee, in care of the Company, at its principal executive
offices. Any notice required under the Plan may be waived by the
person entitled to notice.
1.9. Form and Time of Elections. Unless otherwise
specified herein, each election permitted to be made by any
Participant or other person entitled to benefits under the Plan,
and any permitted modification or revocation thereof, shall be in
writing filed with the Committee at such times and in such form
as the Committee shall require.
1.10. Evidence. Evidence required of anyone under the Plan
may be by certificate, affidavit, document or other information
which the person acting on it considers pertinent and reliable,
and signed, made or presented by the proper party or parties.
1.11. Action by Employers. Any action required or
permitted to be taken by any Employer which is a corporation
shall be by resolution of its Board of Directors, or by a duly
authorized person or persons. Any action required or permitted
183
to be taken by any Employer which is a partnership shall be by a
general partner of such partnership or by a duly authorized
person or persons.
1.12. No Reversion to Employers. No part of the corpus or
income of the Trust shall revert to any Employer or be used for,
or diverted to, purposes other than for the exclusive benefit of
Participants and other persons entitled to benefits under the
Plan, except as specifically provided in the Trust Agreement.
1.13. Plan Supplements. The provisions of the Plan as
applied to any Employer or any group of employees of any Employer
may, with the consent of the Company, be modified or supplemented
from time to time by the adoption of one or more Supplements.
Each Supplement shall form a part of the Plan as of the
Supplement's effective date. In the event of any inconsistency
between a Supplement and the Plan document, the terms of the
Supplement shall govern.
1.14. Defined Terms. Terms used frequently with the same
meaning are indicated by initial capital letters, and are defined
throughout the Plan. Appendix A contains an alphabetical listing
of all such terms and the subsections in which they are defined.
184
SECTION 2
Participation in Plan
---------------------
2.1. Eligibility for Participation. Subject to the
conditions and limitations of the Plan, each individual who was a
Participant in the Plan immediately prior to the Effective Date
will continue as such on and after that date, and each employee
of an Employer who was not a Participant in the Plan immediately
prior to the Effective Date will become a "Participant" in the
Plan on the first day of the first calendar quarter coincident
with or following the Effective Date on which he meets the
following requirements:
(a) he has completed one Year of Service (as defined in
subsection 3.1);
(b) he is not a member of a collective bargaining unit as
to which retirement benefits have been the subject of
good faith bargaining unless the Plan has been extended
to the collective bargaining unit under a currently
effective collective bargaining agreement; and
(c) for periods beginning on and after April 1, 1993,
he is not a temporary employee of an Employer (that is,
an employee who is not a regular full-time employee or
a regular part-time employee).
Notwithstanding the foregoing provisions of this subsection 2.1,
if an individual is employed or reemployed by an Employer on or
after the first calendar quarter coincident with or next
following the date on which he first meets the requirements of
paragraph (a) above, he shall become a Participant in the Plan
immediately upon meeting the requirements of paragraphs (b) and
(c) above if such individual has not incurred a One Year Break in
Service (described in subsection 3.3) or, if the individual has
incurred a One Year Break in Service, retroactive, from the first
day of the Plan Year during which he again completes a Year of
Service.
2.2. Inactive Participation. Once an eligible employee
becomes a Participant in the Plan, he will remain a Participant
as long as he continues to have an Account balance under the Plan
for all purposes under the Plan except the contribution
provisions of Sections 4 and 5 and, unless such Participant is an
employee of an Employer or a Related Company, the withdrawal and
loan provisions of Section 10.
185
2.3. Plan Not Contract of Employment. The Plan does not
constitute a contract of employment, and participation in the
Plan will not give any employee or Participant the right to be
retained in the employ of any Employer nor any right or claim to
any benefit under the Plan, unless such right or claim has
specifically accrued under the terms of the Plan.
2.4. Leased Employees. If a person satisfies the
requirements of section 414(n) of the Code and applicable
Treasury regulations for treatment as a "Leased Employee", such
Leased Employee shall not be eligible to participate in this Plan
or in any other plan maintained by an Employer or a Related
Company which is qualified under section 401(a) of the Code, but,
to the extent required by section 414(n) of the Code and
applicable Treasury regulations, such person shall be treated as
if the services performed by him in such capacity were performed
by him as an employee of a Related Company which has not adopted
the Plan; provided, however, that no such service shall be
credited:
(a) for any period during which not more than 20 percent of
the workforce of the Employers and the Related
Companies that is not Highly Compensated (as defined in
subsection 8.11) consists of Leased Employees and the
Leased Employee is a participant in a money purchase
pension plan maintained by the leasing organization
which (i) provides for a nonintegrated employer
contribution of at least 10 percent of compensation,
(ii) provides for full and immediate vesting, and (iii)
covers all employees of the leasing organization
(beginning with the date they become employees), other
than those employees excluded under section 414(n)(5)
of the Code; or
(b) for any other period unless the Leased Employee
provides satisfactory evidence to the Employer or
Related Company that he meets all of the conditions of
this subsection 2.4 and applicable law required for
treatment as a Leased Employee.
186
SECTION 3
Service
-------
3.1. Year of Service. The term "Year of Service" means,
with respect to any employee, any Plan Year during which he
completes at least 1,000 Hours of Service (as defined in
subsection 3.2), subject to the following:
(a) For purposes of subsection 2.1:
(i) the term Year of Service shall not include
any Plan Year commencing prior to the date on
which the employee first completes an Hour of
Service;
(ii) the 12-consecutive-month period commencing on
the date on which the employee first completes an
Hour of Service shall be deemed to be a Year of
Service if he completes at least 1,000 Hours of
Service during such 12-consecutive-month period.
(b) For purposes of Section 9, if an individual is employed
or reemployed by an Employer after incurring a One Year
Break in Service, his number of Years of Service
accrued prior to such break shall be counted only if
the individual completes a Year of Service following
the date of his employment or reemployment.
(c) For all purposes of the Plan, a Participant's number of
Years of Service accrued after five consecutive One
Year Breaks in Service shall be disregarded for
purposes of determining the nonforfeitable percentage
of his benefit under the Plan derived from Employer
contributions which accrued prior to such break.
Service shall include service with DeVRY Inc. and Bell & Howell
Company prior to August 7, 1987 for those individuals who were
employees of DeVRY Inc. on such date and eligible to participate
in the Bell & Howell Profit Sharing Retirement Plan.
3.2. Hour of Service. The term "Hour of Service" means,
with respect to any employee, each hour for which he is paid or
entitled to payment for the performance of duties for an Employer
or a Related Company or for which back pay, irrespective of
mitigation of damages, has been awarded to the employee or agreed
to by an Employer or a Related Company, subject to the following:
187
(a) An employee shall be credited with the number of
regularly scheduled working hours included in the time
period on the basis of which payment to the employee is
calculated for any period during which he performs no
duties for an Employer or a Related Company
(irrespective of whether the employment relationship
has terminated) by reason of a vacation, holiday,
illness, incapacity (including disability), layoff,
jury duty, military duty or leave of absence but for
which he is directly or indirectly paid or entitled to
payment by an Employer or a Related Company; provided,
however, that an employee shall not be credited with
more than 501 Hours of Service under this paragraph (a)
for any single continuous period during which he
performs no duties for an Employer or a Related
Company. Payments considered for purposes of the
foregoing sentence shall include payments unrelated to
the length of the period during which no duties are
performed but shall not include payments made solely as
reimbursement for medically-related expenses or solely
for the purpose of complying with applicable workmen's
compensation, unemployment compensation or disability
insurance laws.
(b) Solely for purposes of determining whether an employee
has incurred a One Year Break in Service, the employee
shall be credited, to the extent not otherwise credited
in accordance with the foregoing provisions of this
subsection 3.2, with 8 Hours of Service for each day
(up to a maximum of 40 Hours of Service for each
calendar week) for any period during which the employee
is absent from active employment with an Employer or
Related Company by reason of the employee's pregnancy,
the birth of a child of the employee, or the placement
of a child with the employee in connection with the
employee's adoption of such child, and, in each case,
the care of such child immediately after its birth or
placement; provided that in no event shall more than
501 Hours of Service be credited under this paragraph
(b). Hours of Service credited in accordance with the
foregoing sentence shall be credited for the Plan Year
during which the absence begins to the extent that such
crediting would prevent the employee from incurring a
One Year Break in Service during that year and, in each
other case, shall be credited in the immediately
following Plan Year.
3.3. One Year Break in Service. The term "One Year Break
in Service" means, with respect to any employee, any Plan Year
during which he completes fewer than 501 Hours of Service.
188
SECTION 4
Pre-Tax and Rollover Contributions
----------------------------------
4.1. Amount of Pre-Tax Contributions. Subject to the
limitations set forth in Section 8 and such additional rules as
the Committee may establish on a uniform and nondiscriminatory
basis, for any Plan Year a Participant may elect to have his
salary or wages reduced and a corresponding amount contributed on
his behalf to the Plan by his Employer as a "Pre-Tax
Contribution", which amount shall not be less than 2 percent nor
more than 15 percent of his Compensation (as defined in
subsection 4.5) for that year; provided, however, that for
periods ending before April 1, 1993, such amount shall not be
greater than 10 percent of his Compensation. Any election
pursuant to this subsection 4.1 shall be submitted to the
Committee in such form and at such time as the Committee may
require.
4.2. Payment of Pre-Tax Contributions. Pre-Tax
Contributions shall be made each payroll period, and shall be
paid to the Trustee by the Employer on the earliest date on which
such contributions can reasonably be segregated from the
Employer's general assets, but not later than the last day of the
month following the month of the payroll deduction.
4.3. Variation, Discontinuance and Resumption of Pre-Tax
Contributions. Subject to such rules and restrictions as the
Committee may establish on a uniform and nondiscriminatory basis,
a Participant may elect to change his Pre-Tax Contribution rate
(but not retroactively) within the range specified in subsection
4.1, to discontinue having contributions made for him at any pay
period or to have them resumed; provided, however, a Participant
who discontinues his Pre-Tax Contributions (including by reason
of any suspension required under paragraph 10.3(c)) may not
resume such contributions until the first day of the calendar
quarter coincident with or next following the 6-month period
beginning on the date that such contributions are discontinued.
4.4. Rollover Contributions and Transfers. Subject to the
terms of this subsection, effective as of January 1, 1991, a
Participant or an employee who meets the requirements of
subsection 2.1 other than paragraph (a) thereof may, with the
consent of the Committee:
(a) for years beginning on or after January 1, 1993,
contribute part or all of an eligible rollover
contribution (as defined in section 402 of the Code)
(also referred to as a "direct rollover"),
189
(b) for years ending before January 1, 1993,
contribute part or all of a qualified total
distribution (as defined in section 402(a)(5)(E) of the
Code), or
(c) for all years, make a rollover contribution (as
described in section 408(d)(3) of the Code) (a
"participant rollover") which, under the applicable
provisions of the Code, is permitted to be rolled over
to an eligible retirement plan provided that such
contribution must be paid over to the Trustee on or
before the sixtieth day after receipt by the
Participant or employee of the distribution.
In addition, a plan qualified under section 401(a) of the Code
and holding amounts for the benefit of a Participant or an
employee may, with such individual's consent, and the consent of
the Committee, transfer such amounts to the Plan; provided,
however, no amounts may be transferred pursuant to this
subsection 4.4 if such amounts are subject to the provisions of
section 401(a)(11) of the Code, and further provided no transfer
may be made of amounts unless the Plan is not required, pursuant
to Q&A-3(b) of Treas. Reg.,1.411(d)-4, to preserve any section
411(d)(6) protected benefits accrued under the transferor plan
with respect to such amounts. If an employee who is not
otherwise a Participant makes a rollover contribution to the
Plan, he shall be treated as a Participant only with respect to
the amounts so contributed or transferred until he has met all of
the requirements for Plan participation set forth in subsection
2.1.
4.5. Compensation. A Participant's "Compensation" shall
mean his total wages and other compensation as shown in Box 1 (or
predecessor or successor thereto) on any Form W-2 issued by an
Employer for that portion of the Plan Year during which he is
eligible to participate in the Plan, determined prior to any
reductions thereof made in accordance with the provisions of any
plan maintained by an Employer and intended to meet the
requirements of section 125 or 401(k) of the Code and excluding
noncash prizes, taxable relocation, taxable educational
assistance, severance and amounts realized from the exercise of
stock options, up to a maximum amount for the Plan Year of
$150,000 ($200,000 for Plan Years beginning prior to July 1,
1994) or such other amount as may be permitted for any year under
section 401(a)(17) of the Code, taking into account for purposes
of such limitation any proration required in situations where
"family members" (as defined in sections 401(a)(17) and 414(q)(6)
of the Code) and their Compensation must be aggregated, or where
Compensation is computed with respect to a period of less than a
190
full year (other than on account of mid-year commencement or
cessation of active participation in the Plan).
191
SECTION 5
Employer Contributions
----------------------
5.1. Matching Contributions. Subject to the conditions
and limitations of Section 8, each Employer shall make a
"Matching Contribution" to the Plan on behalf of each Participant
employed by such Employer who makes a Pre-Tax Contribution to the
Plan in an amount equal to one percent of such Participant's
Compensation for the month that any such Pre-Tax Contribution is
made.
5.2. Discretionary Profit Sharing Contributions. Subject
to the conditions and limitations of Section 8, each Employer
shall make a "Discretionary Profit Sharing Contribution" for a
Plan Year in the amount, if any, determined by such Employer in
its sole discretion. Any such contribution shall be allocated to
Participants' Accounts (defined in subsection 7.1) in accordance
with the provisions of subsection 7.3.
5.3. Limitations on Amount of Employer Contributions. In
no event shall the sum of the Discretionary Profit Sharing
Contribution and Matching Contribution made by an Employer for
any Plan Year exceed the limitations imposed by section 404 of
the Code on the maximum amount deductible on account thereof by
that Employer for that year.
5.4. Payment of Employer Contributions. Each Employer's
Discretionary Profit Sharing Contribution and Matching
Contribution under the Plan for any Plan Year shall be paid to
the Trustee, without interest, no later than the time prescribed
by law for filing the Employer's federal income tax return,
including any extensions thereof.
192
SECTION 6
Investment of the Trust Fund
----------------------------
6.1. Investment Funds. One or more "Investment Funds" may
be established under the Trust from time to time for the
investment of Participants' Accounts. As of July 1, 1994, the
Investment Funds are as follows:
(a) a "Value Equity Fund", which shall be invested and
reinvested in common or capital stocks of issuers other
than a Related Company (except that the Value Equity
Fund may be invested in common or capital stock of a
Related Company to the extent that any such stock is
held in a commingled fund), bonds, debentures, or
preferred stocks converted into such common or capital
stocks, and other similar types of investments;
(b) a "Growth Equity Fund", which shall be invested and
reinvested in common or capital stocks that are
expected to have high growth rates of issuers other
than a Related Company (except that the Growth Equity
Fund may be invested in common or capital stock of a
Related Company to the extent that any such stock is
held in a commingled fund), bonds, debentures, or
preferred stocks converted into such common or capital
stocks, and other similar types of investments;
(c) a "Fixed Income Fund", which shall be invested
primarily in intermediate-term bonds, and in part in
commercial mortgages, the income or return from which
is fixed, limited or determinable in advance by the
terms of a contract, document or instrument creating or
evidencing such property or interest in property, or by
the terms of the acquisition thereof;
(d) a "Balanced Fund", which shall be invested and
reinvested partly in common or capital stocks and
partly in bonds of issuers other than a Related Company
(except that the Balanced Fund may be invested in
Common Stocks or bonds of a Related Company to the
extent such stocks or bonds are held in a commingled
fund);
(e) a "Money Market Reserves Fund" which shall be invested
and reinvested in short term securities issued by the
U.S. Government;
193
(f) a "Stock Fund", which shall be invested by the Trustee
solely in qualifying employer securities of DeVRY Inc.
purchased by the Trustee on the open market; and
(g) a "Loan Fund", which shall consist only of promissory
notes evidencing loans to Participants in accordance
with subsection 10.1.
6.2. Investment Fund Accounting. The Committee shall
maintain or cause to be maintained separate subaccounts for each
Participant in each of the Investment Funds to separately reflect
his interests in each such Fund and the portion thereof that is
attributable to each of his Accounts.
6.3. Investment Fund Elections. At the time that a
Participant enrolls in the Plan and effective as of any January
1, April 1, July 1, or October 1 thereafter, each Participant may
specify the percentage of contributions and forfeitures (as
provided in subsection 11.11) subsequently credited to his
Accounts that are to be invested in each of the Investment Funds,
subject to such rules and limitations as the Committee may
determine. As of July 1, 1994, a Participant's investment
elections may be made in multiples of 5 percent (but no less than
10% to any one Investment Fund), provided, that allocations to
the Stock Fund shall not exceed 25% of contributions and
forfeitures. Separate elections with respect to different types
of contributions may not be made. During any period in which no
direction is on file with the Committee, contributions and
forfeitures credited to a Participant shall be invested in the
Money Market Reserves Fund. Any elections under this subsection
6.3 and subsection 6.4 shall be made at such times and in such
form as the Committee may require.
6.4. Transfers Between Investment Funds. Subject to the
provisions of subsection 6.3 and such administrative rules as may
be applicable to any Investment Fund, effective as of the first
day of any calendar quarter, a Participant may elect to transfer
the value of his Accounts held in any Investment Fund to any
other Investment Fund then made available to such Participant;
provided, however, no transfers may be made from another
Investment Fund to the Stock Fund and no amounts may be
transferred directly from the Fixed Income Fund to the Money
Market Reserves Fund; further provided, that such transfers shall
be subject to such rules and limitations as the Committee may
establish. Subject to the provisions of this subsection 6.4, as
of July 1, 1994, transfers may be made in multiples of 5 percent
(but no less than 10% may transferred to any one Investment
Fund).
194
SECTION 7
Plan Accounting
---------------
7.1. Participants' Accounts. The Committee shall maintain
(or cause to be maintained) the following "Accounts" in the name
of each Participant:
(a) a "Pre-Tax Account," which shall reflect Pre-Tax
Contributions, rollover contributions and transferred
amounts (other than after-tax amounts included in
paragraph (d) next below), if any, made by the
Participant or on his behalf and the income, losses,
appreciation and depreciation attributable thereto;
(b) a "Matching Account," which shall reflect Matching
Contributions, if any, made on his behalf and
forfeitures, if any, allocated to him in accordance
with subsection 7.3 and the income, losses,
appreciation and depreciation attributable thereto;
(c) a "Discretionary Account", which shall reflect
Discretionary Profit Sharing Contributions, if any, and
forfeitures, if any, allocated to him in accordance
with subsection 7.3, and the income, losses,
appreciation and depreciation attributable thereto; and
(d) an "After-Tax Transfer Account," which shall reflect
transferred amounts attributable to after tax-
contributions made by the Participant, if any, and the
income, losses, appreciation and depreciation
attributable thereto.
The Accounts provided for in this subsection 7.1 shall be for
accounting purposes only, and there shall be no segregation of
assets within the Investment Funds among the separate Accounts.
Reference to the "balance" in a Participant's Accounts means the
aggregate of the balances in the subaccounts maintained in the
Investment Funds attributable to these Accounts.
7.2. Adjustment of Participants' Accounts. As of each
Valuation Date prior to or coincident with his Distribution Date
(as described in subsection 11.1), the Accounts of a Participant
shall be adjusted in the following manner and order:
195
(a) first, the balances of the subaccounts of all such
Participants under each of the Investment Funds, other
than the Loan Fund, shall be adjusted upward or
downward, pro rata, according to the balances so that
the total of the balances equal the then Fair Market
Value (as defined below) of such Investment Fund;
(b) next, there shall be allocated and credited to each
Participant's Loan Fund subaccount and charged to the
Participant's subaccounts under the other Investment
Funds any loan made to such Participant and any
interest which has accrued thereon since the last
preceding Valuation Date in accordance with paragraph
10.1(b);
(c) next, there shall be charged to each Participant's Loan
Fund subaccount and credited to the Participant's
subaccounts under the other Investment Funds in
accordance with paragraph 10.1(e) any payments of
principal and interest received by the Trustee from
such Participant since the last preceding Valuation
Date;
(d) next, there shall be allocated and credited to each
such Participant's appropriate Account the
contributions and forfeitures, if any, that are to be
allocated and credited as of that date in accordance
with the provisions of subsection 7.3; and
(e) finally, there shall be charged to the proper
subaccount for each Account of each Participant under
each of the Investment Funds all payments, withdrawals,
distributions and quarterly transfers among Investment
Funds made to or on account of that Participant since
the last preceding Valuation Date that have not been
charged previously.
The "Fair Market Value" of an Investment Fund as at any date
means the then net worth of that Investment Fund, as determined
by the Trustee in accordance with the provisions of the Trust
and, to the extent held under that fund, exclusive of:
(i) Discretionary Profit Sharing Contributions,
if any, received by the Trustee for the period
elapsed since the close of the last preceding Plan
Year;
(ii) Pre-Tax and Matching Contributions, rollover
contributions and transferred amounts, if any,
196
received by the Trustee for the period elapsed
since the last preceding Valuation Date;
(iii) forfeitures, if any, arising under the Plan during
the period elapsed since the close of the last
preceding Plan Year; and
(iv) any payments of interest and repayments of
principal with respect to any loans under
subsection 10.1 received by the Trustee since the
last preceding Valuation Date.
7.3. Allocation and Crediting of Contributions and
Forfeitures. Subject to the provisions of Section 8,
contributions and forfeitures shall be allocated and credited as
follows:
(a) Pre-Tax Contributions, Matching Contributions, rollover
contributions and transferred amounts made by or on
behalf of a Participant for any month (or calendar
quarter for periods prior to August 1, 1993) shall be
credited to that Participant's appropriate Accounts as
of the Valuation Date coinciding with or next following
the last day of such month (or calendar quarter).
(b) As of the last day of each Plan Year, the Discretionary
Profit Sharing Contribution of each Employer for that
Plan Year and any forfeitures pursuant to subsection
11.11 attributable to prior Discretionary Profit
Sharing Contributions by an Employer shall be allocated
among and credited to the appropriate Accounts of
Participants who completed a Year of Service during
that Plan Year, excluding Participants who were not
employed by the Employer on the last day of the year,
but including Participants who were not employed by the
Employer on the last day of that year because of death,
retirement on or after age 62 or total and permanent
disability, pro rata, according to the proportion the
Participant's total units (described below) with
respect to such year bear to the total units awarded to
all Participants with respect to such year. For
purposes of this subsection 7.3, a Participant shall
receive one unit for each full $100 of Compensation
received by him during the year if he has completed
fewer than 10 Years of Service with the Employers and
Related Companies or two units for each full $100 of
Compensation received by him during the year if he has
completed ten or more Years of Service with the
Employers and Related Companies as of the last day of
the Plan Year.
197
(c) As of the last day of each Plan Year, any forfeitures
pursuant to section 11.11 attributable to prior
Matching Contributions by an Employer shall be
allocated among and credited to the appropriate
Accounts of Participants in the manner described in
paragraph (b) above; provided, however, only
Participants who made Pre-Tax Contributions during such
Plan Year shall be eligible for an allocation and for
purposes of determining the proportion of such a
Participant's total units, only Participants who made
Pre-Tax Contributions during such year shall be
included.
For purposes of this Section 7, Discretionary Profit Sharing
Contributions for any Plan Year shall be considered to have been
made on the last day of that year, regardless of when paid to the
Trustee.
7.4. Statement of Plan Interest. As soon as practicable
after the last day of each Plan Year, the Committee shall provide
each Participant with a statement reflecting the balances of his
Accounts.
198
SECTION 8
Limitations on Compensation, Contributions and Allocations
----------------------------------------------------------
8.1. Reduction of Contribution Rates. To conform the
operation of the Plan to sections 401(a)(4), 401(k)(3), 401(m),
402(g) and 415(c) of the Code, the Committee may unilaterally
modify or revoke any Pre-Tax Contribution election made by a
Participant pursuant to subsection 4.1, or may reduce (to zero if
necessary) the level of Matching Contributions to be made on
behalf of Highly Compensated Participants pursuant to subsection
5.1.
8.2. Limitations on Annual Addition. Notwithstanding any
other provisions of the Plan to the contrary, a Participant's
Annual Addition (as defined below) for any Plan Year shall not
exceed an amount equal to the lesser of:
(a) $30,000 (or, if greater, 1/4 of the dollar
limitation in effect under section 415(b)(1)(A) of the
Code); or
(b) 25 percent of the Participant's Section 415
Compensation (defined below) for that Plan Year ,
calculated as if each Section 415 Affiliate (defined
below) were a Related Company,
reduced by any Annual Addition for the Participant for the Plan
Year under any other defined contribution plan of an Employer or
a Related Company or Section 415 Affiliate, provided that, if any
other such plan has a similar provision, the reduction shall be
pro rata. The term "Annual Addition" means, with respect to any
Participant for any Plan Year the sum of all contributions
(excluding rollover contributions and transfers) and forfeitures
allocated to a Participant's Accounts under the Plan for such
year pursuant to subsection 7.3, regardless of whether any such
amounts (or portions thereof) are subsequently distributed in
accordance with subsections 8.5, 8.7, 8.9 or 8.10. The term
Annual Addition shall also include employer contributions
allocated for a Plan Year to any individual medical account (as
defined in section 415(l) of the Code) of a Participant and any
amount allocated for a Plan Year to the separate account of a
Participant for payment of post-retirement medical benefits under
a funded welfare benefit plan (as described in section 419A(d)(2)
of the Code), which is maintained by an Employer or a Related
Company or a Section 415 Affiliate. A Participant's "Section 415
Compensation" shall mean the Participant's Compensation
(determined without regard to the limitation under section
401(a)(17) of the Code), less any elective contributions made on
199
the Participant's behalf for the Plan Year to a plan sponsored by
an Employer or a Related Company that are not currently
includable in income pursuant to sections 125 or 402(a)(8) of the
Code. "Section 415 Affiliate" means any entity that would be a
Related Company if the ownership test of section 414 of the Code
were "more than 50 percent" rather than "at least 80 percent".
For purposes of applying the limitations of section 415 of the
Code, the limitation year shall be the Plan Year.
8.3. Excess Annual Additions. If, as a result of the
allocation of forfeitures, a reasonable error in estimating a
Participant's Compensation or such other mitigating circumstances
as the Commissioner of Internal Revenue shall prescribe, the
Annual Additions for a Participant for a Plan Year exceed the
limitations set forth in subsection 8.2, the excess amounts shall
be held in suspense as necessary, and credited to such
Participant's Account in the next following Plan Year in
accordance with Treas. Reg., 1.415-6(b)(6)(ii) after any Pre-Tax
Contributions are first returned. Any Pre-Tax Contributions
returned to the Participant in accordance with this subsection
8.3 shall be disregarded for purposes of subsections 8.5, 8.6,
8.9 and 8.10.
8.4. Combined Plan Limitation. If a Participant also
participates in any defined benefit plan (as defined in section
415(k) of the Code) maintained by an Employer or a Related
Company or Section 415 Affiliate, the aggregate benefits payable
to, or on account of, the Participant under such plan together
with this Plan shall be determined in a manner consistent with
section 415(e) of the Code. The benefit provided for the
Participant under the defined benefit plan shall be adjusted to
the extent necessary so that the sum of the "defined benefit
fraction" and the "defined contribution fraction" (as such terms
are defined in section 415(e) of the Code and applicable
regulations thereunder) calculated with regard to such
Participant does not exceed 1.0. For purposes of this subsection
8.4, all qualified defined benefit plans (whether or not
terminated) of the Employers, Related Companies and Section 415
Affiliates shall be treated as one defined benefit plan.
8.5. $7,000 Limitation. In no event shall the Pre-Tax
Contributions for a Participant under the Plan (together with
elective deferrals under any other cash-or-deferred arrangement
maintained by an Employer or a Related Company) for any taxable
year exceed $7,000 or such other amount as may be permitted under
section 402(g) of the Code. If during any taxable year a
Participant is also a participant in another cash or deferred
arrangement, and if his elective deferrals under such other
arrangement together with his Pre-Tax Contributions exceed the
maximum amount permitted for the Participant for that year under
200
section 402(g) of the Code, the Participant, not later than
March 1 following the close of such taxable year, may request the
Committee to direct the Trustee to distribute all or a portion of
such excess to him, with any allocable gains or losses for that
Plan Year (determined in accordance with any reasonable method
adopted by the Committee for that Plan Year that either (i)
conforms to the accounting provisions of Section 7 and is
consistently applied to the distribution of excess deferrals
under this subsection 8.5 and excess contributions under
subsections 8.7, 8.9 and 8.10 to all affected Participants, or
(ii) satisfies any alternative method set forth in applicable
Treasury regulations. Any such request shall be in writing and
shall include adequate proof of the existence of such excess, as
determined by the Committee in its sole discretion. If the
Committee is so notified, such excess amount shall be distributed
to the Participant no later than the April 15 following the close
of the Participant's taxable year. In addition, if the
applicable limitation for a Plan Year happens to be exceeded with
respect to this Plan alone, or this Plan and another plan or
plans of the Employers and Related Companies, the Committee shall
direct such excess Pre-Tax Contributions (with allocable gains or
losses) to be distributed to the Participant as soon as
practicable after the Committee is notified of the excess
deferrals by the Company, an Employer or the Participant, or
otherwise discovers the error (but no later than the April 15
following the close of the Participant's taxable year).
Notwithstanding the foregoing provisions of this subsection 8.5,
the dollar amount of any distribution due hereunder shall be
reduced by the dollar amount of any Pre-Tax Contributions
previously distributed to the same Participant pursuant to
subsection 8.7, provided, however, that for purposes of
subsections 8.2 and 8.6, the correction under this subsection 8.5
shall be deemed to have occurred before the correction under
subsection 8.7.
8.6. Code Section 401(k)(3) Testing. For any Plan Year,
the amount by which the average of the Deferral Percentages (as
defined below) of each eligible employee who is Highly Compen
sated (the "Highly Compensated Group Deferral Percentage")
exceeds the average of the Deferral Percentages of each eligible
employee who is not Highly Compensated (the "Non-Highly Compen
sated Group Deferral Percentage") shall be less than or equal to
either (i) a factor of 1.25 or (ii) both a factor of 2 and a
difference of 2. "Deferral Percentage" for any eligible employee
for a Plan Year shall be determined by dividing his Pre-Tax
Contributions for the year by his Compensation for the year,
subject to the following special rules:
(a) any employee eligible to participate in the Plan
at any time during a Plan Year in accordance with
201
subsection 2.1 (without regard to any suspension
imposed by any other provision hereunder) shall be
counted, whether or not any Pre-Tax Contributions are
made on his behalf for the year;
(b) the Deferral Percentage for any Highly Compensated
Participant who is eligible to participate in the Plan
and who is also eligible to make other elective
deferrals under one or more other cash or deferred
arrangements described in section 401(k) of the Code
maintained by an Employer or a Related Company for a
plan year that ends with or within the Plan Year (other
than a plan or arrangement subject to mandatory
disaggregation under applicable Treasury regulations),
shall be determined as if all such elective deferrals
were made on his behalf under the Plan;
(c) for purposes of determining the Deferral
Percentage of a Highly Compensated Participant who is a
5-percent owner (as defined in section 416(i)(1)(B) of
the Code) of an Employer or a Related Company or one of
the ten most highly-paid employees of all the Employers
and Related Companies, the Pre-Tax Contributions and
Compensation of such Participant shall include the Pre-
Tax Contributions and Compensation for the Plan Year of
his family members (as defined in section 414(q)(6) of
the Code), and any such family members shall be
disregarded as separate employees in determining the
Highly Compensated and Non-Highly Compensated Group
Deferral Percentages;
(d) excess Pre-Tax Contributions distributed to a
Participant under subsection 8.5 shall be counted in
determining such Participant's Deferral Percentage,
except in the case of a distribution to a non-Highly
Compensated Participant required to comply with section
401(a)(30) of the Code;
(e) if this Plan is aggregated with one or more other
plans for purposes of section 410(b) of the Code (other
than the average benefit percentage test), this
subsection 8.6 shall be applied as if all such plans
were a single plan; provided, however, that for Plan
Years beginning after 1989, such aggregated plans must
all have the same plan year; and
(f) all Participants who are members of a single
collective bargaining unit shall be tested separately
under this subsection 8.6.
202
Application of this subsection 8.6 shall be made in accordance
with section 401(k)(3) of the Code and applicable regulations
thereunder.
8.7. Correction Under Section 401(k) Test. In the event
that the Highly Compensated Group Deferral Percentage for any
Plan Year does not initially satisfy one of the tests referred to
in subsection 8.6, the Committee shall direct the Trustee to
distribute to Highly Compensated Participants enough of their Pre-
Tax Contributions under the leveling method described in
applicable Treasury regulations, with any allocable gains or
losses for such Plan Year determined in accordance with any
reasonable method adopted by the Committee for that Plan Year
that either (i) conforms to the accounting provisions of
Section 7 and is consistently applied to making corrective
distributions under this subsection 8.7 and subsections 8.5, 8.9
and 8.10 to all affected Participants or (ii) satisfies any
alternative method set forth in applicable Treasury regulations,
so that the Highly Compensated Group Deferral Percentage meets
one of the tests referred to in subsection 8.6. The amount to be
distributed to any Participant pursuant to this subsection 8.7
shall be reduced by the amount of any Pre-Tax Contributions
distributed to him for the taxable year ending with or within
such Plan Year pursuant to subsection 8.5. To the extent any
distribution of excess contributions is required pursuant to this
subsection 8.7 for any Plan Year, such distribution shall be made
after the close of the Plan Year in which the excess arose and in
no event later than the close of the Plan Year following such
Plan Year.
8.8. Code Section 401(m)(2) Testing. For any Plan Year,
the amount by which the average of the Contribution Percentages
(as defined below) of each eligible employee who is Highly
Compensated (the "Highly Compensated Group Contribution Per
centage") exceeds the average of the Contribution Percentages of
each eligible employee who is not Highly Compensated (the "Non-
Highly Compensated Group Contribution Percentage") shall be less
than or equal to either (i) a factor of 1.25 or (ii) both a
factor of 2 and a difference of 2. The "Contribution Percentage"
for any eligible employee for a Plan Year shall be determined by
dividing his Matching Contributions for the year by his
Compensation for the year, subject to the following special
rules:
(a) any employee eligible to participate in the Plan
at any time during a Plan Year in accordance with
subsection 2.1 (without regard to any suspension
imposed by any other provision hereunder) shall be
counted, whether or not any Matching Contributions are
made for him for the year;
203
(b) the Contribution Percentage for any Highly
Compensated Participant who is eligible to participate
in the Plan and who is also eligible to participate in
one or more other qualified plans maintained by an
Employer or a Related Company with a plan year that
ends with or within the Plan Year (other than a plan
subject to mandatory disaggregation under applicable
Treasury regulations) with after-tax or matching
contributions shall be determined as if all such
contributions were made under the Plan;
(c) for purposes of determining the Contribution
Percentage of a Highly Compensated Participant who is a
5-percent owner (as defined in section 416(i)(1)(B) of
the Code) of an Employer or a Related Company or one of
the ten most highly-paid employees of all the Employers
and Related Companies, the Matching Contributions and
Compensation of such Participant shall include the
Matching Contributions and Compensation for the Plan
Year of his family members (as defined in section
414(q)(6) of the Code), and any such family members
shall be disregarded as separate employees in
determining the Highly Compensated and Non-Highly
Compensated Group Contribution Percentages;
(d) if this Plan is aggregated with one or more other
plans for purposes of section 410(b) of the Code (other
than the average benefit percentage test), this
subsection 8.9 shall be applied as if all such plans
were a single plan; provided, however, that for Plan
Years beginning after 1989, such aggregated plans must
all have the same plan year; and
(e) all Participants who are members of a single
collective bargaining unit shall be tested separately
under this subsection 8.8.
Application of the provisions of this subsection 8.8 shall be
made in accordance with the requirements of section 401(m)(2) of
the Code and the regulations thereunder.
8.9. Correction Under Section 401(m) Test. In the event
that the Highly Compensated Group Contribution Percentage for any
Plan Year does not initially satisfy one of the tests referred to
in subsection 8.8, the Committee shall direct the Trustee to
distribute to Highly Compensated Participants enough of their
Matching Contributions under the leveling method described in
applicable Treasury regulations, with any allocable gains or
losses for such Plan Year determined in accordance with any
204
reasonable method adopted by the Committee for that Plan Year
that either (i) conforms to the accounting provisions of Section
7 and is consistently applied to making corrective distributions
under this subsection 8.9 and subsections 8.5, 8.7 and 8.10 to
all affected Participants or (ii) satisfies any alternative
method set forth in applicable Treasury regulations, so that the
Highly Compensated Group Contribution Percentage meets one of the
tests referred to in subsection 8.8. Notwithstanding the
foregoing provisions of this subsection 8.9, any such excess
Matching Contributions that are not yet vested in accordance with
subsection 9.1 shall be forfeited as of the end of the Plan Year
to which such corrective distributions relate (and treated in the
same manner as any other forfeiture under the Plan). The
Committee shall make any distribution required under this
subsection 8.9 for any Plan Year after the close of the Plan Year
in which such excess contributions were contributed and in no
event later than the close of the Plan Year following such Plan
Year.
8.10. Multiple Use of Alternative Limitation. Effective
for Plan Years beginning on or after January 1, 1989, notwith
standing any other provision of this Section 8, if the 1.25
factors referred to in subsections 8.6 and 8.8 are both exceeded
for a Plan Year, the leveling method of correction prescribed in
subsection 8.9 shall be continued until the aggregate limit set
forth in Treas. Reg., 1.401(m)-2(b)(3) is satisfied for such
Plan Year.
8.11. Highly Compensated. An employee or Participant shall
be "Highly Compensated" for any Plan Year if during that Plan
Year or the preceding Plan Year, he:
(a) was at any time a 5 percent owner of an Employer
or a Related Company;
(b) received Compensation in excess of $75,000
(indexed for cost-of-living adjustments under section
415(d) of the Code);
(c) received Compensation in excess of $50,000
(indexed for cost-of-living adjustments under section
415(d) of the Code), and was in the top-paid group of
employees (as defined below) for such year; or
(d) was at any time an officer and received
Compensation greater than 50 percent of the amount in
effect under section 415(b)(1)(A) of the Code for such
year, provided that the officers taken into account
under this paragraph (d) shall be limited to 50 or, if
205
less, the greater of 3 individuals or 10 percent of the
employees of all the Employers and Related Companies;
provided, however, that an employee in category (b), (c) or (d)
above for the current Plan Year who does not fall within at least
one such category for the preceding Plan Year shall not be
considered Highly Compensated for the current Plan Year unless he
is also among the 100 most highly-paid employees of all the
Employers and Related Companies for such current year. An
employee shall be considered to be in the "top-paid group" of
employees for any year if such employee is in the group
consisting of the top 20 percent of the active employees of all
the Employers and Related Companies when ranked on the basis of
Compensation paid during such year. In determining the total
number of active employees in a year, the following provisions
shall apply:
(i) the term "employee" shall include a leased
employee who is treated as an employee pursuant to the
provisions of section 414(n)(2) of the Code, other than
any individual who is covered by a safe-harbor plan
described in section 414(n)(5) of the Code; and
(ii) the following employees shall be disregarded:
employees who have not attained age 21 by the end of
the year; employees who by the end of the year have not
completed 6 months of service (including service in the
immediately preceding year); employees who normally
work fewer than 17-1/2 hours per week; employees who
normally work fewer than 6 months during any year; and
non-resident aliens with no U.S. source income.
8.12. Plan Disaggregation. Notwithstanding the foregoing
provisions of this Section 8, for Plan Years prior to 1992,
testing under subsections 8.6, 8.8 and 8.10 and correction under
subsections 8.7, 8.9 and 8.10 may be performed separately with
respect to different groups of eligible employees under the Plan
as determined by the Committee, provided that each such group
meets the requirements of applicable regulations under section
401(a)(4) of the Code.
206
SECTION 9
Vesting and Termination Dates
-----------------------------
9.1. Determination of Vested Interest. The interest of a
Participant in his Discretionary Account and Matching Account
shall become fully vested and nonforfeitable in accordance with
the following schedule:
Years of Service Vested Percentage
Fewer than 1 0
1 but fewer than 2 20
2 but fewer than 3 40
3 but fewer than 4 60
4 but fewer than 5 80
5 or more 100
A Participant shall at all times have a nonforfeitable interest
in his Pre-Tax Account and After-Tax Transfer Account.
9.2. Accelerated Vesting. Notwithstanding the foregoing
provisions of this Section 9, a Participant shall have a fully
vested, nonforfeitable interest in all his Accounts when he
attains age 62, dies or becomes permanently disabled while
employed by an Employer or a Related Company. In addition, in
the event of the Plan's termination (in accordance with
subsection 13.2) or partial termination (as determined under
applicable law and regulations) or the complete discontinuance of
Employer contributions to the Plan, each affected Participant
shall have a fully vested, nonforfeitable interest in all his
Accounts. For purposes of the Plan, a Participant will be
considered permanently disabled if, on account of physical or
mental disability, he no longer is capable of performing the
duties assigned to him by his Employer or of any other position
at the Employer for which the employee is reasonably qualified or
which condition constitutes total disability under the Federal
Social Security Act.
9.3. Termination Date. A Participant's "Termination Date"
shall be the date on which his employment with the Employers and
Related Companies terminates for any reason.
9.4. Distribution Only Upon Separation From Service.
Subject to subsection 11.14, notwithstanding any other provision
of the Plan to the contrary, a Participant may not commence
distribution of his Pre-Tax Account pursuant to Section 11, even
though his employment with the Employers and Related Companies
has terminated, unless or until he also has a "separation from
207
service" within the meaning of section 401(k)(2)(B) of the
Internal Revenue Code. The foregoing restriction shall not
apply, however, if the Participant's termination of employment
occurs in connection with the sale by an Employer to an unrelated
corporation of at least 85 percent of the assets of a trade or
business, or the sale of its interest in a subsidiary to an
unrelated entity, provided (a) the Participant remains employed
in such trade or business or by such subsidiary after the sale,
(b) the Employer continues to maintain the Plan after the sale,
(c) no transfer of the Participant's Accounts occurs or is
scheduled to occur after the sale pursuant to subsection 13.3 to
a plan of such subsidiary or of the purchaser of such assets (or
any entity affiliated therewith), and (d) the Participant
receives distribution of his Pre-Tax Account under the Plan in a
lump sum by the end of the second calendar year after the year in
which the sale occurs.
208
SECTION 10
Loans and Withdrawals of Contributions While Employed
-----------------------------------------------------
10.1. Loans to Participants. The Committee, upon written
request by a Participant who is an employee of an Employer or
Related Company, or who is otherwise required to be given the
opportunity to borrow under applicable regulations, in such form
as the Committee may require and accompanied by the application
fee established by the Committee, may authorize a loan to be made
to the Participant of up to one-half of the balance in his Pre-
Tax Account subject to the following:
(a) No loan shall be made to a Participant if,
immediately after such loan, the sum of the outstanding
balances (including principal and interest) of all
loans made to him under this Plan and under any other
qualified retirement plans maintained by the Related
Companies would exceed $50,000, reduced by the excess,
if any, of:
(i) the highest outstanding balance of
all loans to the Participant from the plans during
the one-year period ending on the day immediately
before the date on which the loan is made; over
(ii) the outstanding balance of loans from
the plans to the Participant on the date on which
such loan is made;
and no loan shall be made to a Participant if the
aggregate amount of that loan and the outstanding
balance of any other loans to the Participant from the
Plan would exceed one-half of the total vested balance
of the Participant's Accounts under the Plan as of the
date the loan is made.
(b) Each loan to a Participant shall be charged
against his Pre-Tax Account and the Investment Funds in
which his Pre-Tax Account is invested in accordance
with his election; provided, however, loans may not be
charged against the Stock Fund. If a Participant does
not elect the method of charging his Investment Funds,
the loan shall be charged against each Investment Fund
other than the Stock Fund in the same ratio as the
value of his interest in such Fund bears to the total
of his Pre-Tax Account excluding the Stock Fund.
209
(c) Each loan shall be evidenced by a written note
providing for:
(i) a reasonable repayment period of
not more than 5 years from the date of the loan
(or such longer period as the Committee may permit
for a loan used to acquire a dwelling which,
within a reasonable period of time, will be used
as the Participant's principal residence);
(ii) a reasonable rate of interest;
(iii) substantially equal payments
of principal and interest over the term of the
loan no less frequently than quarterly; and
(iv) such other terms and conditions as
the Committee shall determine.
(d) Promissory notes shall be held by the Trustee in
the Loan Fund.
(e) Payments of principal and interest to the Trustee
with respect to any loan to a Participant:
(i) shall reduce the outstanding
balance with respect to that loan;
(ii) shall reduce the balance of the
Loan Fund holding the promissory note reflecting
that loan;
(iii) shall be credited to the
Participant's Pre-Tax Account; and
(iv) shall be invested in the Investment
Funds (other than the Loan Fund) in accordance
with his most recent investment directions.
(f) A Participant's obligation to repay a loan (or
loans) from the Plan shall be secured by the
Participant's vested interest in the Plan.
(g) Generally, loan repayments will be made by payroll
deductions. However, during any period when payroll
deduction is not possible or is not permitted under
applicable law, repayment will be made by personal
check.
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(h) The loan may be prepaid in full or in part at any
time without penalty, subject to such rules as the
Committee may establish with respect to the minimum
amount of any partial prepayment.
(i) Any loan to a Participant shall become immediately
due and payable upon his termination of employment with
the Employers and Related Companies if he does not
continue to be a party in interest to the Plan after
such termination, unless such Participant's Accounts
are scheduled to be transferred to a qualified plan of
an employer that is not a Related Company pursuant to
subsection 13.3. Notwithstanding any other provision
of the Plan to the contrary, if the outstanding balance
of principal and interest on any loan is not paid
within 30 days of the expiration of its term or upon
acceleration in accordance with the preceding sentence,
a default shall occur and the Trustee shall apply all
or a portion of the Participant's vested interest in
the Plan in satisfaction of such outstanding
obligation, but only to the extent such vested interest
(or portion thereof) is then distributable under
applicable provisions of the Code. If necessary to
satisfy the entire outstanding obligation, such
application of the Participant's vested interest may be
executed in a series of actions as amounts credited to
the Participant's Account become distributable.
(j) If distribution is to be made to a Beneficiary in
accordance with subsection 11.3, any outstanding
promissory note of the Participant shall be canceled
and the unpaid balance of the loan, together with any
accrued interest thereon, shall be treated as a
distribution to or on behalf of the Participant
immediately prior to commencement of distribution to
the Beneficiary.
(k) A Participant may have no more than two loans
outstanding at a time.
(l) The Committee shall establish uniform procedures
for applying for a loan, evaluating loan applications,
and setting reasonable rates of interest, which shall
be communicated to Participants in writing.
10.2. Withdrawals On Account of Hardship. In the event of
a Hardship (as defined in subsection 10.3), a Participant whose
Termination Date has not yet occurred may elect to withdraw all
or part of his interest in his Pre-Tax Account at intervals no
211
shorter than 12 months, as provided and in the order set forth
below:
(a) up to 100% of the portion of his Pre-Tax Account
attributable to rollover contributions;
(b) up to 100% of his Pre-Tax Contributions; and
(c) up to 100% of the earnings credited on his Pre-Tax
Contributions prior to January 1, 1989.
10.3. Hardship Withdrawals. A withdrawal will not be
considered to be made on account of "Hardship" unless the
following requirements are met:
(a) The withdrawal is requested because of an
immediate and heavy financial need of the Participant,
and will be so deemed if the Participant represents
that the withdrawal is made on account of:
(i) expenses for medical care described
in section 213(d) of the Code incurred by the
Participant, the Participant's spouse or any
dependent of the Participant (as defined in
section 152 of the Code) or necessary for such
persons to obtain such medical care;
(ii) the purchase (excluding mortgage
payments) of a principal residence of the
Participant;
(iii) payment of tuition and related
educational fees for the next 12 months of post-
secondary education for the Participant, or his
spouse, children or dependents;
(iv) the need to prevent the eviction of
the Participant from his principal residence or
foreclosure on the mortgage of the Participant's
principal residence; or
(v) any other circumstances of
immediate and heavy financial need identified as
such in revenue rulings, notices or other
documents of the Internal Revenue Service of
general applicability.
(b) The withdrawal must also be necessary to satisfy
the immediate and heavy financial need of the
Participant. It will be considered necessary if the
Committee determines that the amount of the withdrawal
does not exceed the amount required to relieve the
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financial need (taking into account any applicable
income or penalty taxes resulting from the withdrawal)
and if the need cannot be satisfied from other sources
that are reasonably available to the Participant. In
making this determination, the Committee may reasonably
rely on the Participant's written representation that
the need cannot be relieved:
(i) through reimbursement or
compensation by insurance or otherwise;
(ii) by reasonable liquidation of the
Participant's assets, to the extent such
liquidation would not itself give rise to an
immediate and heavy financial need;
(iii) by ceasing to make Pre-Tax
Contributions to the Plan (or any other plan of
the Employer permitting deferral of compensation);
or
(iv) by a loan pursuant to subsection
10.1 or by borrowing from commercial sources on
reasonable commercial terms.
(c) Notwithstanding any other provision of the Plan,
Pre-Tax and Matching Contributions by or on behalf of
the Participant shall be suspended as of the first day
of the pay period coincident with or next following the
date of the Hardship withdrawal and such contributions
may not be resumed until the first day of the calendar
quarter coincident with or next following the 6-month
period beginning on the date of such suspension. A
Participant shall not fail to be treated as an eligible
employee for purposes of subsections 8.6 and 8.8 merely
because of the application of this paragraph (c).
10.4. Withdrawals On or After Age 59-1/2. A Participant
whose Termination Date has not yet occurred may elect to withdraw
all or part of his interest in his Pre-Tax Account on or after
the date he attains age 59-1/2, at intervals no shorter than 12
months, as provided and in the order set forth below:
(a) up to 100% of his Pre-Tax Contributions;
(b) up to 100% of the earnings credited on his Pre-Tax
Contributions; and
(c) up to 100% of the portion of his Pre-Tax Account
attributable to rollover contributions.
213
10.5. Form of Withdrawal. For purposes of subsections 10.2
and 10.4, a Participant's Pre-Tax Account shall be valued as of
the Valuation Date immediately preceding the withdrawal.
Withdrawals from the Stock Fund shall be made in either cash or
shares of DeVRY Inc. common stock, as the Participant elects or,
if the Participant does not elect, withdrawals pursuant to
subsection 10.2 shall be made in cash and withdrawals pursuant to
subsection 10.4 shall be made in shares of DeVRY Inc. common
stock. For purposes of subsections 10.2 and 10.4, each
withdrawal by a Participant shall be charged against the
Investment Funds in which his Pre-Tax Account is invested in
accordance with his election. If a Participant does not elect
the method of charging his withdrawal, the withdrawal shall be
charged against the Investment Funds (other than the Stock Fund)
according to descending level of investment risk and the Stock
Fund shall be charged last.
214
SECTION 11
Distributions
-------------
11.1. Distributions to Participants After Termination of
Employment. If a Termination Date occurs with respect to a
Participant (for a reason other than his death), the vested
portions of his Accounts shall be distributed in accordance with
the following provisions of this subsection 11.1, subject to the
provisions of subsection 11.2 and subsection 11.5:
(a) If the value of the vested portions of the Parti
cipant's Accounts (including any loans outstanding on
his Termination Date) does not exceed $3,500,
determined as of the Valuation Date next following his
Termination Date such vested portions, less any
outstanding loan balance distributable in accordance
with subsection 10.1(i), shall be distributed to the
Participant as soon as practicable after the Valuation
Date next following his Termination Date, in a lump sum
payment.
(b) If the value of the vested portions of the Partici
pant's Accounts (including any loans outstanding on his
Termination Date) exceeds $3,500, determined as of the
Valuation Date next following his Termination Date,
such vested portions, less any outstanding loan balance
distributable in accordance with subsection 10.1(i),
shall be distributed (or shall begin to be distributed)
to the Participant on (or as soon as practicable after)
the Distribution Date he elects, by one of the
following methods chosen by the Participant:
(i) by payment in a lump sum, or
(ii) by payment in a series of
substantially equal annual or more frequent
installments for a period not exceeding 10 years,
or
(iii) by purchase from an insurance
company and distribution to him of an annuity
contract providing for periodic distributions to
him or to him and his Beneficiary for his life
(with or without a period certain) or their joint
lives, subject to the provisions of subsection
11.4;
215
provided, however, that if the value of the vested
portions of the Participant's Accounts is reduced to
less than $3,500 as of any Valuation Date prior to a
Distribution Date selected by the Participant, on
account of investment losses or payment to an alternate
payee pursuant to a qualified domestic relations order,
such reduced Account balance shall be distributed to
the Participant as soon as practicable after such
Valuation Date.
(c) "Distribution Date" shall mean the Valuation Date
as of which a payment in any form is made pursuant to
this Section 11; provided, however, that in the event
of an election of an annuity under paragraph (b)(iii)
above, the Distribution Date shall be no later than the
date payment is irrevocably made on behalf of the
Participant to the insurance company issuing the
annuity contract.
11.2. Direct Rollover. Effective January 1, 1993, if the
distributee of a distribution under paragraphs (a) or (b)(i) of
subsection 11.1 or any other eligible rollover distribution (as
defined in section 402 of the Code or related regulations or
notices) under the Plan:
(a) elects in such form and at such time as the
Committee may prescribe to have part or all of the
distribution paid directly to an eligible retirement
plan (as defined in section 401(a)(31)(D) of the Code),
and
(b) specifies an eligible retirement plan to which the
distribution is to be paid,
the distribution shall be made in the form of a direct trustee-to-
trustee rollover to the plan so specified.
11.3. Distributions to Beneficiaries. Subject to
subsection 11.2 and subsection 11.5, the following rules shall
apply if a Participant dies while any vested portions of his
Accounts remain undistributed:
(a) If the Participant dies before benefit payments to
him have commenced or an annuity contract has been
purchased, the vested balance of his Accounts less any
outstanding loan balance distributable in accordance
with paragraph 10.1(j), shall be distributed as soon as
practicable after the Valuation Date following the date
of his death, to his Beneficiary (as defined in
subsection 11.6) in a lump sum payment.
216
(b) If a Participant dies after benefit payments to
him have commenced, the vested balance, if any, of his
Accounts shall continue to be distributed to his
Beneficiary in accordance with the method of
distribution selected by the Participant; provided,
however, that the Beneficiary may elect to have such
vested balance paid in a lump sum payment as soon as
practicable after the Valuation Date next following the
Participant's death.
11.4. Special Rules Governing Annuity Elections. If a
married Participant elects distribution in the form of an annuity
pursuant to paragraph 11.1(b)(iii), the following rules shall
apply and shall supersede any other provision of the Plan to the
contrary:
(a) The vested portions of the Participant's Accounts,
less any outstanding loan balance distributable in
accordance with paragraph 10.1(i), shall be used to
purchase a nontransferable "Joint and Survivor Annuity"
(that is, an annuity payable for the life of the
Participant with a survivor annuity payable for the
life of his spouse which is not less than 50 percent of
the amount of the annuity payable during the joint
lives of the Participant and spouse), unless the
Participant elects another form of annuity and, if
applicable, a Beneficiary other than his spouse, with
the consent of his spouse to such form and Beneficiary,
during the 90-day period immediately preceding his
Distribution Date, which Distribution Date shall be no
earlier than 30 days after his receipt of a written
explanation from the Committee of the terms and
conditions of the Joint and Survivor Annuity and the
effect of an election of a different annuity form.
(b) No consent by the spouse to the election of a form
of annuity other than the Joint and Survivor Annuity
and, if applicable, Beneficiary other than the spouse
shall be effective unless it is in writing,
acknowledges the effect of such consent and is
witnessed by a notary public (unless the Committee
determines that there is no spouse, that the spouse
cannot be located or that consent may be waived because
of such other circumstances as regulations or rulings
under Code section 417 set forth).
(c) During the period between his election of an
annuity and his Distribution Date, no loan may be made
to a Participant pursuant to subsection 10.1, no amount
may be withdrawn by the Participant pursuant to
217
subsection 10.2 or 10.4 and no amount may be
distributed to the Participant pursuant to subsection
11.1, in any form other than a Joint and Survivor
Annuity, without the written consent of the spouse as
provided in paragraph (b) of this subsection 11.4.
(d) Subject to paragraph (e) below, if the Participant
dies during the period between his election of an
annuity and his Distribution Date, the vested portions
of his Accounts (less any amounts credited to the Loan
Fund, which shall be distributed in accordance with
paragraph 10.1(j)) shall be paid to his spouse in the
form of a life annuity as of the Valuation Date next
following the date the Participant would have attained
age 65 or, if the spouse so elects, as soon as
practicable after the Valuation Date next following his
death; provided, however, that a spouse to whom payment
is due under this paragraph (d) may elect to have such
vested portions, if any, distributed in the form of a
lump sum payment.
(e) The provisions of paragraph (d) above shall not
apply, and distribution upon the death of the
Participant shall be made in accordance with subsection
11.3, if the spouse consents to the designation of a
Beneficiary other than the spouse in accordance with
subsection 11.6 during the period between the
Participant's election of an annuity and his death, and
acknowledges that such consent to the Participant's
designation of such Beneficiary constitutes the
spouse's consent to the Participant's waiver of a
qualified preretirement survivor annuity payable to the
spouse in accordance with section 417 of the Code.
(f) A Participant may revoke his election pursuant to
this subsection 11.4, and may make a new election of
any form of distribution permitted under paragraph
11.1(b), at any time during the 90-day period
immediately preceding his Distribution Date; provided,
however, that if the effect of such revocation is to
select a distribution form other than a Joint and
Survivor Annuity, it shall be ineffective without the
written consent of his spouse in accordance with
paragraph (b) of this subsection 11.4 to the new form
of distribution and, if applicable, a Beneficiary other
than the spouse.
(g) A spouse's consent in accordance with paragraph
(b) of this subsection 11.4 shall be irrevocable.
218
11.5. Limits on Commencement and Duration of Distributions.
The following distribution rules shall be applied in accordance
with sections 401(a)(9) and 401(a)(14) of the Code and applicable
regulations thereunder, including the minimum distribution
incidental benefit requirement of Treas. Reg., 1.401(a)(9)-2,
and shall supersede any other provision of the Plan to the
contrary:
(a) Unless the Participant elects otherwise, in no
event shall distribution commence later than 60 days
after the close of the Plan Year in which the latest of
the following events occurs: the Participant's
attainment of age 65; the 10th anniversary of the year
in which the Participant began participating in the
Plan; or the Participant's Termination Date.
(b) Notwithstanding any other provision herein to the
contrary, distribution of the Participant's Accounts
shall commence by lump sum cash payment of his entire
Account balances on or before the Required Beginning
Date and each December 31 thereafter or, if the
Participant elects, by minimum annual distributions
based upon the Participant's life expectancy and
calculated in accordance with Treas. Reg.,
1.401(a)(9)-1 no later than his "Required Beginning
Date", that is, April 1 of the calendar year following
the calendar year in which he attains age 70-1/2,
unless the Participant attained age 70-1/2 prior to
January 1, 1988 (during a Plan Year when he was not a 5
percent or more owner, as described in Code section
416), in which case his Required Beginning Date will be
delayed until his Termination Date.
(c) The life expectancy of a Participant or a
Beneficiary will be determined in accordance with
Tables V and VI of Treas. Reg., 1.72-9, and shall not
be recalculated unless the Participant elects otherwise
prior to his Required Beginning Date.
(d) In the event of an annuity payment, distribution
payments shall be made over the life of the Participant
or over the lives of such Participant and his
Beneficiary (or over a period not extending beyond the
life expectancy of such Participant or the life
expectancy of such Participant and his Beneficiary).
(e) If a Participant dies after distribution of his
vested interest in the Plan has begun, the remaining
portion of such vested interest, if any, shall be
distributed to his Beneficiary at least as rapidly as
219
under the method of distribution used prior to the
Participant's death.
(f) If a Participant dies before distribution of his
vested interest in the Plan has begun, distribution of
such vested interest to his Beneficiary shall be
completed by December 31 of the calendar year in which
the fifth anniversary of the Participant's death
occurs; provided, however, that this five-year rule
shall not apply to a natural person designated as
Beneficiary by the Participant or under the specific
terms of the Plan, if
(i) such vested interest will be
distributed over the life of such designated
Beneficiary (or over a period not extending beyond
the life expectancy of such Beneficiary),
(ii) such distribution to the
Beneficiary begins not later than December 31 of
the calendar year following the calendar year in
which the Participant died or, if such Beneficiary
is the Participant's surviving spouse, not later
than December 31 of the calendar year following
the calendar year in which the Participant would
have attained age 70-1/2, and
(iii) the Beneficiary elects not to
have the five-year rule apply.
(g) If the Participant's surviving spouse is his
Beneficiary and such spouse dies before distribution to
such spouse begins, paragraph (f) shall be applied as
if the surviving spouse were the Participant.
(h) For purposes of paragraph (e) and (f),
distribution of a Participant's vested interest in the
Plan is considered to begin on his Required Beginning
Date; provided, however, that distribution irrevocably
begun in the form of an annuity shall be considered to
begin on the date it actually commences.
11.6. Beneficiary Designations. The term "Beneficiary"
shall mean the Participant's surviving spouse. However, if the
Participant is not married, or if the Participant is married but
his spouse consents to the designation of a person other than the
spouse, the term Beneficiary shall mean such person or persons as
the Participant designates to receive the vested portions of his
Accounts upon his death (or to be his co-annuitant beneficiary
under a term certain, in the event of distribution in the form of
220
an annuity contract). Such designation may be made, revoked or
changed (without the consent of any previously-designated
Beneficiary except his spouse) only by an instrument signed by
the Participant and received by the Committee prior to his death.
A spouse's consent to the designation of a Beneficiary other than
the spouse shall be in writing, shall acknowledge the effect of
such designation, shall be witnessed by a Plan representative or
a notary public and shall be effective only with respect to such
consenting spouse. In default of such designation, or at any
time when there is no surviving spouse and no surviving
Beneficiary designated by the Participant, his Beneficiary shall
be his surviving children (per stirpes) or, if he has no
children, the estate of the last to die of the Participant or his
designated Beneficiary. For purposes of the Plan, "spouse" means
the person to whom the Participant is legally married at the
relevant time. Notwithstanding the foregoing provisions of this
subsection 11.6, no spousal consent to the designation of a
person other than, or in addition to, the spouse as Beneficiary
shall be required if (i) the Participant and his spouse are
legally separated or the Participant has been abandoned (under
applicable state law) and the Participant has a court order to
that effect or (ii) it is established to the satisfaction of the
Committee that the spouse's consent cannot be obtained because
there is no spouse, because the spouse cannot be located or
because of such other circumstances as may be prescribed in
applicable Treasury regulations.
11.7. Facility of Payment. Notwithstanding the provisions
of this Section 11, if, in the Committee's opinion, a Participant
or Beneficiary is under a legal disability or is in any way
incapacitated so as to be unable to manage his financial affairs,
the Committee may direct the Trustee to make payment to a
relative or friend of such person for his benefit until claim is
made by a conservator or other person legally charged with the
care of his person or of his estate. Thereafter, any benefits
under the Plan to which such Participant or Beneficiary is
entitled shall be paid to such conservator or other person
legally charged with the care of his person or his estate.
11.8. Interests Not Transferable. The interests of a
Participant and other persons entitled to benefits under the Plan
are not subject to the claims of their creditors and may not be
voluntarily or involuntarily assigned, alienated or encumbered,
except in the case of a qualified domestic relations order which
relates to the provision of child support, alimony payments or
marital rights of a spouse, child or other dependent of a
Participant and which meets such requirements as may be imposed
by section 414(p) of the Code or regulations issued thereunder.
Notwithstanding any other provision of the Plan to the contrary,
such a domestic relations order may permit distribution of the
221
entire portion of the vested Account balance of a Participant
awarded to his alternate payee, in a lump sum payment as soon as
practicable after the Committee determines that such order is
qualified, without regard to whether the Participant would
himself be entitled under the terms of the Plan to withdraw or
receive a distribution of such vested amount at that time.
11.9. Absence of Guaranty. Neither the Committee, the
Trustee nor the Employers in any way guarantee the Trust Fund
from loss or depreciation. The Employers do not guarantee any
payment to any person. The liability of the Trustee to make any
payment is limited to the available assets of the Trust Fund.
11.10. Missing Participants or Beneficiaries. Each
Participant and each Beneficiary designated by the Participant
must file with the Committee from time to time in writing his
post office address and each change of post office address. Any
communication, statement or notice addressed to a Participant or
Beneficiary at his last post office address filed with the
Committee or, in the case of a Participant, if no address is
filed with the Committee then at his last post office address as
shown on the Employers' records, will be binding on the
Participant and his Beneficiary for all purposes of the Plan.
Neither the Employers, the Committee nor the Trustee will be
required to search for or locate a Participant or Beneficiary.
11.11. Treatment of Nonvested and Partially Vested
Accounts. If a Termination Date occurs with respect to a
Participant who is not fully vested in his Accounts, the
following rules shall apply:
(a) The unvested portion of his Accounts shall be
forfeited as of the earlier of the date as of which the
vested portions of his Accounts are distributed to him
or the date the Participant incurs five consecutive One
Year Breaks in Service.
222
(b) If a Participant who received a distribution is
reemployed by an Employer or Related Company before he
incurs five consecutive One Year Breaks in Service, the
amount forfeited under paragraph (a) above shall be
restored (subject to the following provisions of this
paragraph (b)), without adjustment for earnings and
losses after the forfeiture, subject to the following:
(i) If the Participant received a
distribution of the vested portion of his Accounts
on account of his previous termination of
employment, the amount forfeited shall not be
restored unless the Participant repays to the
Trustee the full amount of such distribution
(without adjustment for any subsequent earnings or
losses thereon) before the earlier of the fifth
anniversary of his reemployment or the close of
five consecutive One Year Breaks in Service
commencing after the distribution, in which event
the amount forfeited shall be restored as soon as
practicable after the repayment.
(ii) The restoration shall be made first
from current forfeitures, if any, under the Plan
and then, if necessary, from a special Employer
contribution to the Plan.
(iii) A restoration shall not be
considered an Annual Addition for purposes of
subsection 8.2.
(iv) The amount restored shall be maintained
in separate subaccounts within the Participant's
Matching and Discretionary Accounts and his vested
interest in each subaccount shall be determined by
adding the amount of the prior distributions from
such Accounts to his separate subaccounts from
such Accounts to his separate subaccount balances
before applying the schedule set forth in
subsection 9.1 and then subtracting the amounts of
the prior distributions from the amounts derived
after application of such schedule.
(c) If the Participant is reemployed by an Employer or
Related Company after he incurs five consecutive One
Year Breaks in Service, such reemployment shall have no
effect on the forfeiture under paragraph (a) above.
11.12. Application of Forfeitures. Any forfeiture of
Discretionary Profit Sharing Contributions or Matching
Contributions and earnings thereon during a Plan Year pursuant to
223
subsection 11.11 shall be used first to restore any prior
forfeitures as required by subsection 11.11, and then shall be
allocated to Participants for the Plan Year in which such
forfeiture occurs in accordance with subsection 7.3 of the Plan.
11.13. Form of Payment. Payments shall be made in cash,
unless the Participant elects to have the portion of his Accounts
invested in the Stock Fund distributed in whole shares of DeVRY
Inc. common stock.
11.14. Disability Distribution. Notwithstanding any other
provision of the Plan to the contrary, a Participant who is
disabled, within the meaning of section 401(k)(2)(B) of the Code,
may elect immediate distribution of his Account balance without
regard to whether his Termination Date or separation from service
has occurred.
224
SECTION 12
The Committee
-------------
12.1. Membership and Authority. The Committee referred to
in subsection 1.3 shall consist of a committee of one or more
members appointed by the Company's Board of Directors. Except as
otherwise specifically provided in this Section 12, in
controlling and managing the operation and administration of the
Plan, the Committee shall act by a majority of its then members,
by meeting or by writing filed without meeting, and shall have
the following discretionary authority, powers, rights and duties
in addition to those vested in it elsewhere in the Plan or Trust:
(a) to adopt such rules of procedure and regulations
as, in its opinion, may be necessary for the proper and
efficient administration of the Plan and as are
consistent with the provisions of the Plan;
(b) to enforce the Plan in accordance with its terms
and with such applicable rules and regulations as may
be adopted by the Committee;
(c) to determine conclusively all questions arising
under the Plan, including the power to determine the
eligibility of employees and the rights of Participants
and other persons entitled to benefits under the Plan
and their respective benefits, and to remedy any
ambiguities, inconsistencies or omissions of whatever
kind;
(d) to maintain and keep adequate records concerning
the Plan and concerning its proceedings and acts in
such form and detail as the Committee may decide;
(e) to direct all payments of benefits under the Plan;
(f) to perform the functions of a "plan administrator"
as defined in section 414(g) of the Code, for purposes
of Section 7 and for purposes of establishing and
implementing procedures to determine the qualified
status of domestic relations orders (in accordance with
the requirements of section 414(p) of the Code) and to
administer distributions under such qualified orders;
(g) to employ agents, attorneys, accountants or other
persons (who may also be employed by or represent the
Employers) for such purposes as the Committee considers
necessary or desirable to discharge its duties; and
225
(h) to establish a claims procedure in accordance with
section 503 of ERISA.
The certificate of a majority of the members of the Committee
that the Committee has taken or authorized any action shall be
conclusive in favor of any person relying on the certificate.
12.2. Allocation and Delegation of Committee Responsi
bilities and Powers. In exercising its authority to control and
manage the operation and administration of the Plan, the
Committee may allocate all or any part of its responsibilities
and powers to any one or more of its members and may delegate all
or any part of its responsibilities and powers to any person or
persons selected by it. Any such allocation or delegation may be
revoked at any time. Any member or delegate exercising Committee
responsibilities and powers under this subsection shall
periodically report to the Committee on its exercise thereof and
the discharge of such responsibilities.
12.3. Uniform Rules. In managing the Plan, the Committee
shall uniformly apply rules and regulations adopted by it to all
persons similarly situated.
12.4. Information to be Furnished to Committee. The
Employers and Related Companies shall furnish the Committee such
data and information as may be required for it to discharge its
duties. The records of the Employers and Related Companies as to
an employee's or Participant's period of employment, termination
of employment and the reason therefor, leave of absence,
reemployment and compensation shall be conclusive on all persons
unless determined to be incorrect. Participants and other
persons entitled to benefits under the Plan must furnish to the
Committee such evidence, data or information as the Committee
considers desirable to carry out the Plan.
12.5. Committee's Decision Final. Any interpretation of
the Plan and any decision on any matter within the discretion of
the Committee made by the Committee shall be binding on all
persons. A misstatement or other mistake of fact shall be
corrected when it becomes known, and the Committee shall make
such adjustment on account thereof as it considers equitable and
practicable.
12.6. Exercise of Committee's Duties. Notwithstanding any
other provisions of the Plan, the Committee shall discharge its
duties hereunder solely in the interests of the Participants and
other persons entitled to benefits under the Plan, and:
226
(a) for the exclusive purpose of providing benefits to
Participants and other persons entitled to benefits
under the Plan; and
(b) with the care, skill, prudence and diligence under
the circumstances then prevailing that a prudent man
acting in a like capacity and familiar with such
matters would use in the conduct of an enterprise of a
like character and with like aims.
12.7. Remuneration and Expenses. No remuneration shall be
paid from the Plan to any Committee member as such. However, the
reasonable expenses (including the fees and expenses of persons
employed by it in accordance with paragraph 12.1(g)) of a
Committee member incurred in the performance of any Committee
function shall be reimbursed by the Employers.
12.8. Indemnification of the Committee. The Committee and
the individual members thereof shall be indemnified by the
Employers against any and all liabilities, losses, costs and
expenses (including legal fees and expenses) of whatsoever kind
and nature which may be imposed on, incurred by or asserted
against the Committee or its members by reason of the performance
of any Committee function if the Committee or such members did
not act dishonestly or in willful violation of the law or
regulation under which such liability, loss, cost or expense
arises.
12.9. Resignation or Removal of Committee Member. A
Committee member may resign at any time by giving ten days'
advance written notice to the Employers, the Trustee and the
other Committee members. The Company may remove any Committee
member by giving advance written notice to him, the Trustee and
the other Committee members.
12.10. Appointment of Successor Committee Members. The
Company's Board of Directors may fill any vacancy in the member
ship of the Committee and shall give prompt written notice
thereof to the other Committee members, the other Employers and
the Trustee. While there is a vacancy in the membership of the
Committee, the remaining Committee members shall have the same
powers as the full Committee until the vacancy is filled.
227
SECTION 13
Amendment and Termination
-------------------------
13.1. Amendment. While the Company expects to continue
the Plan, it necessarily reserves the right, subject to the
provisions of the Trust Agreement, to terminate the Plan or to
amend it from time to time, except that no amendment will reduce
a Participant's interest in the Plan to less than an amount equal
to the amount he would have been entitled to receive if he had
resigned from the employ of the Employers and the Related
Companies on the day of the amendment.
13.2. Termination. The Plan will terminate as to all of
the Employers on any day specified by the Company if advance
written notice of the termination is given to the other
Employers. Employees of any Employer shall cease active
participation in the Plan (and will be treated as inactive
Participants in accordance with subsection 2.2) on the first to
occur of the following:
(a) the date on which that Employer, by appropriate
action communicated in writing to the Company, ceases
to be a contributing sponsor of the Plan;
(b) the date that Employer is judicially declared bank
rupt or insolvent; or
(c) the dissolution, merger, consolidation, reorganiza
tion or sale of that Employer, or the sale by that
Employer of all or substantially all of its assets,
except that, subject to the provisions of subsection
13.3, with the consent of the Company, in any such
event arrangements may be made whereby the Plan will be
continued by any successor to that Employer or any
purchaser of all or substantially all of that
Employer's assets, in which case the successor or
purchaser will be substituted for the Employer under
the Plan.
13.3. Merger and Consolidation of the Plan, Transfer of
Plan Assets. The Committee in its discretion may direct the
Trustee to transfer all or a portion of the assets of this Plan
to another defined contribution plan of the Employers or Related
Companies which is qualified under section 401(a) of the Code or,
in the event of the sale of stock of an Employer or all or a
portion of the assets of an Employer, to a qualified plan of an
employer which is not a Related Company. In the case of any
merger or consolidation with, or transfer of assets and
liabilities to, any other plan, provision shall be made so that
each affected Participant in the Plan on the date thereof (if the
228
Plan, as applied to that Participant, then terminated) would
receive a benefit immediately after the merger, consolidation or
transfer which is equal to or greater than the benefit he would
have been entitled to receive immediately prior to the merger,
consolidation or transfer if the Plan, as applied to him, had
then terminated.
13.4. Distribution on Termination and Partial Termination.
Upon termination or partial termination of the Plan, all benefits
under the Plan shall continue to be paid in accordance with
Sections 10 and 11 as such section may be amended from time to
time.
13.5. Notice of Amendment, Termination or Partial
Termination. Affected Participants will be notified of an
amendment, termination or partial termination of the Plan as
required by law.
229
APPENDIX A
DEFINED TERMS
7.1 - Accounts
7.1 - After-Tax Transfer Account
8.2 - Annual Additions
6.1 - Balanced Fund
11.6 - Beneficiary
1.1 - Code
1.3 - Committee
1.1 - Company
4.5 - Compensation
8.8 - Contribution Percentage
8.6 - Deferral Percentage
7.1 - Discretionary Account
5.1 - Discretionary Profit Sharing Contributions
11.1 - Distribution Date
1.1 - Effective Date
1.2 - Employer
7.2 - Fair Market Value
6.1 - Fixed Income Fund
6.1 - Growth Equity Fund
10.3 - Hardship
8.11 - Highly Compensated
8.8 - Highly Compensated Group Contribution Percentage
8.6 - Highly Compensated Group Deferral Percentage
3.2 - Hour of Service
6.1 - Investment Funds
11.4 - Joint and Survivor Annuity
2.4 - Leased Employee
6.1 - Loan Fund
7.1 - Matching Account
5.2 - Matching Contribution
6.1 - Money Market Reserves Fund
8.8 - Non-Highly Compensation Group
Contribution Percentage
8.6 - Non-Highly Compensated Group Deferral Percentage
3.3 - One Year Break in Service
2.1 - Participant
1.1 - Plan
1.4 - Plan Year
1.5 - Valuation Dates
6.1 - Value Equity Fund
7.1 - Pre-Tax Account
4.1 - Pre-Tax Contribution
1.2 - Related Company
11.5 - Required Beginning Date
8.2 - Section 415 Affiliate
8.2 - Section 415 Compensation
6.1 - Stock Fund
9.3 - Termination Date
1.3 - Trust Agreement
7.2 - Trust Fund
1.3 - Trustee
3.1 - Year of Service
230
SUPPLEMENT A
TO
DEVRY INC. PROFIT SHARING RETIREMENT PLAN
-----------------------------------------
(Top-Heavy Status)
Application A-1. This Supplement A to DeVRY
Inc. Profit Sharing Retirement Plan
(the "Plan") shall be applicable on
and after the date on which the
Plan becomes Top-Heavy (as
described in subsection A-4).
Definitions A-2. Unless the context clearly
implies or indicates the contrary,
a word, term or phrase used or
defined in the Plan is similarly
used or defined for purposes of
this Supplement A.
Affected A-3. For purposes of this
Participant Supplement A, the term "Affected
Participant" means each Participant
who is employed by an Employer or a
Related Company during any Plan
Year for which the Plan is Top-
Heavy; provided, however, the term
"Affected Participant" shall not
include any Participant who is
covered by a collective bargaining
agreement if retirement benefits
were the subject of good faith
bargaining between his Employer and
his collective bargaining
representative.
Top-Heavy A-4. The Plan shall be "Top-Heavy"
for any Plan Year if, as of the
Determination Date for that year
(as described in paragraph (a) next
below), the present value of the
benefits attributable to Key
Employees (as defined in subsection
A-5) under all Aggregation Plans
(as defined in subsection A-8)
exceeds 60 percent of the present
value of all benefits under such
plans. The foregoing determination
231
shall be made in accordance with
the provisions of section 416 of
the Code. Subject to the preceding
sentence:
(a) The Determination Date
with respect to any plan for
purposes of determining Top-
Heavy status for any plan year
of that plan shall be the last
day of the preceding plan year
or, in the case of the first
plan year of that plan, the
last day of that year. The
present value of benefits as
of any Determination Date
shall be determined as of the
accounting date or valuation
date coincident with or next
preceding the Determination
Date. If the plan years of
all Aggregation Plans do not
coincide, the Top-Heavy status
of the Plan on any
Determination Date shall be
determined by aggregating the
present value of Plan benefits
on that date with the present
value of the benefits under
each other Aggregation Plan
determined as of the
Determination Date of such
other Aggregation Plan which
occurs in the same calendar
year as the Plan's
Determination Date.
(b) Benefits under any plan
as of any Determination Date
shall include the amount of
any distributions from that
plan made during the plan year
which includes the
Determination Date (including
distributions under a
terminated plan which, if it
had not been terminated, would
have been required to be
included in an aggregation
group) or during any of the
232
preceding four plan years, but
shall not include any amounts
attributable to employee
contributions which are
deductible under section 219
of the Code, any amounts
attributable to employee-
initiated rollovers or
transfers made after
December 31, 1983 from a plan
maintained by an unrelated
employer, or, in case of a
defined contribution plan, any
amounts attributable to
contributions made after the
Determination Date unless such
contributions are required by
section 412 of the Code or are
made for the plan's first plan
year.
(c) Benefits attributable to
a participant shall include
benefits paid or payable to a
beneficiary of the
participant, but shall not
include benefits paid or
payable to any participant who
has not performed services for
an Employer or Related Company
during any of the five plan
years ending on the applicable
Determination Date; provided,
however, that if a participant
performs no services for five
years and then performs
services, the benefits
attributable to such
participant shall be included.
(d) The accrued benefit of
any participant who is a Non-
Key Employee with respect to a
plan but who was a Key
Employee with respect to such
plan for any prior plan year
shall not be taken into
account.
233
(e) The accrued benefit of a
Non-Key Employee shall be
determined under the method
which is used for accrual
purposes for all plans of the
Employer and Related
Companies; or, if there is not
such a method, as if the
benefit accrued not more
rapidly than the slowest
accrual rate permitted under
section 411(b)(1)(C) of the
Code.
(f) The present value of
benefits under all defined
benefit plans shall be
determined on the basis of a 6
percent per annum interest
factor and the 1984 Unisex
Pension Mortality Table, with
a one-year setback.
Key Employee A-5. The term "Key Employee" means
an employee or deceased employee
(or beneficiary of such deceased
employee) who is a Key Employee
within the meaning ascribed to that
term by section 416(i) of the Code.
Subject to the preceding sentence,
the term Key Employee includes any
employee or deceased employee (or
beneficiary of such deceased
employee) who at any time during
the plan year which includes the
Determination Date or during any of
the four preceding plan years was:
(a) an officer of any
Employer or Related Company
with Compensation in excess of
50 percent of the amount in
effect under section
415(b)(1)(A) of the Code for
the calendar year in which
that year ends; provided,
however, that the maximum
number of employees who shall
be considered Key Employees
234
under this paragraph (a) shall
be 50;
(b) one of the 10 employees
owning the largest interests
in any Employer or any Related
Company (disregarding any
ownership interest which is
less than 1/2 of one percent),
excluding any employee for any
plan year whose Compensation
did not exceed the applicable
amount in effect under section
415(c)(1)(A) of the Code for
the calendar year in which
that year ends;
(c) a 5 percent owner of any
Employer or of any Related
Company; or
(d) a 1 percent owner of any
Employer or any Related
Company having Compensation in
excess of $150,000.
Compensation A-6. The term "Compensation" for
purposes of this Supplement A
generally means compensation within
the meaning of section 415(c)(3) of
the Code for that year, not
exceeding $150,000 or such larger
amount as may be permitted for any
year under Code section 401(a)(17).
However, for Plan Years beginning
on or after January 1, 1989, solely
for purposes of determining who is
a Key Employee, the term
"Compensation" means compensation
as defined in Code section
414(q)(7).
Non-Key Employee A-7. The term "Non-Key Employee"
means any employee (or beneficiary
of a deceased employee) who is not
a Key Employee.
Aggregation Plan A-8. The term "Aggregation Plan"
means the Plan and each other
235
retirement plan (including any
terminated plan) maintained by an
Employer or Related Company which
is qualified under section 401(a)
of the Code and which:
(a) during the plan year
which includes the applicable
Determination Date, or during
any of the preceding four plan
years, includes a Key Employee
as a participant;
(b) during the plan year
which includes the applicable
Determination Date or, during
any of the preceding four plan
years, enables the Plan or any
plan in which a Key Employee
participates to meet the
requirements of section
401(a)(4) or 410 of the Code;
or
(c) at the election of the
Employer, would meet the
requirements of sections
401(a)(4) and 410 if it were
considered together with the
Plan and all other plans
described in paragraphs (a)
and (b) next above.
Required A-9. The term "Required Aggregation
Aggregation Plan" means a plan described in
Plan either paragraph (a) or (b) of
subsection A-8.
Permissive A-10. The term "Permissive
Aggregation Aggregation Plan" means a plan
Plan described in paragraph (c) of
subsection A-8.
Minimum A-11. For any Plan Year during
Contribution which the Plan is Top-Heavy, the
minimum amount of Employer
contributions and forfeitures,
excluding elective contributions as
236
defined in Code section 401(k) and
employer matching contributions as
defined in Code section 401(m),
allocated to the Accounts of each
Affected Participant who is
employed by an Employer or Related
Company on the last day of that
year (whether or not he has
completed 1,000 Hours of Service
during that year), who is a Non-Key
Employee and who is not entitled to
a minimum benefit for that year
under any defined benefit
Aggregation Plan which is top-heavy
shall, when expressed as a
percentage of the Affected
Participant's Compensation, be
equal to the lesser of:
(a) 3%; or
(b) the percentage at which
Employer contributions
(including Employer
contributions made pursuant to
a cash or deferred
arrangement) and forfeitures
are allocated to the Accounts
of the Key Employee for whom
such percentage is greatest.
For purposes of the preceding
sentence, compensation earned while
a member of a group of employees to
which the Plan has not been
extended shall be disregarded.
Paragraph (b) next above shall not
be applicable for any Plan Year if
the Plan enables a defined benefit
plan described in paragraph A-8(a)
or A-8(b) to meet the requirements
of section 401(a)(4) or 410 for
that year. Employer contributions
for any Plan Year during which the
Plan is Top-Heavy shall be
allocated first to non-Key
Employees until the requirements of
this subsection A-11 have been met
and, to the extent necessary to
comply with the provisions of this
subsection A-11, additional
237
contributions shall be required of
the Employers.
Aggregate A-12. For any Plan Year during
Benefit Limit which the Plan is Top-Heavy,
paragraphs (2)(B) and (3)(B) of
section 415(e) of the Code shall be
applied by substituting "1.0" for
"1.25".
Dates Referenced Herein
| Referenced-On Page |
|---|
| This ‘10-K’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| Filed on: | | 9/24/96 | | | | | | | None on these Dates |
| For Period End: | | 6/30/96 |
| | 7/1/94 | | 14 | | 18 |
| | 8/1/93 | | 7 | | 21 |
| | 7/31/93 | | 7 |
| | 4/1/93 | | 9 | | 13 |
| | 1/1/93 | | 13 | | 40 |
| | 7/1/92 | | 1 | | 7 |
| List all Filings |
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