exv10w20



 



EXHIBIT 10.20


NEW CENTURY ENERGIES, INC.

EMPLOYEE INVESTMENT PLAN FOR

BARGAINING UNIT EMPLOYEES AND

FORMER NON-BARGAINING UNIT EMPLOYEES



(As Amended and Restated Effective January 1, 2002

But With Certain Retroactive Amendments)



 






 





TABLE OF CONTENTS




	 	 	 	 	 	 	 	 
	 	 	 	 	 	Page
	ARTICLE I	 	PURPOSE AND ESTABLISHMENT OF THE PLAN
	 	 	 	 
	1.01	 	 	Establishment of the Plan
	 	 	1	 
	1.02	 	 	Purpose
	 	 	2	 
	1.03	 	 	Trust Agreement
	 	 	2	 
	ARTICLE II	 	DEFINITIONS
	 	 	 	 
	2.01	 	 	“Account” or “Accounts”
	 	 	2	 
	2.02	 	 	“Affiliated Company”
	 	 	3	 
	2.03	 	 	“Alternate Payee”
	 	 	3	 
	2.04	 	 	“Beneficiary”
	 	 	3	 
	2.05	 	 	“Board”
	 	 	3	 
	2.06	 	 	“Code”
	 	 	3	 
	2.07	 	 	“Committee”
	 	 	3	 
	2.08	 	 	“Company Contribution Account”
	 	 	3	 
	2.09	 	 	“Company Matching Contribution Account”
	 	 	3	 
	2.10	 	 	“Company Stock”
	 	 	3	 
	2.11	 	 	“Compensation”
	 	 	4	 
	2.12	 	 	“Date of Employment” or “Date of Reemployment”
	 	 	4	 
	2.13	 	 	“Elective Contributions”
	 	 	5	 
	2.14	 	 	“Eligible Employee”
	 	 	5	 
	2.15	 	 	“Employee”
	 	 	5	 
	2.16	 	 	“Employee Elective Contribution Account”
	 	 	5	 
	2.17	 	 	“Employer”
	 	 	6	 
	2.18	 	 	“ERISA”
	 	 	6	 
	2.19	 	 	“ESOP”
	 	 	6	 
	2.20	 	 	“ESOP Employee Contribution Account”
	 	 	6	 
	2.21	 	 	“ESOP Employer Contribution Account”
	 	 	6	 
	2.22	 	 	“Fiscal Year”
	 	 	6	 
	2.23	 	 	“Hour of Service”
	 	 	6	 
	2.24	 	 	“Investment Manager”
	 	 	6	 
	2.25	 	 	“Leave of Absence”
	 	 	6	 
	2.26	 	 	“One-Year Period of Severance”
	 	 	7	 
	2.27	 	 	“Participant”
	 	 	7	 
	2.28	 	 	“Period of Service”
	 	 	7	 
	2.29	 	 	“Period of Severance”
	 	 	8	 
	2.30	 	 	“Plan”
	 	 	8	 
	2.31	 	 	“Plan Quarter”
	 	 	8	 
	2.32	 	 	“Plan Year”
	 	 	8	 
	2.33	 	 	“QDRO Account”
	 	 	8	 
	2.34	 	 	“Qualified Domestic Relations Order”
	 	 	8	 
	2.35	 	 	“Required Beginning Date”
	 	 	8	 



i






 




	 	 	 	 	 	 	 	 
	 	 	 	 	 	Page
	2.36	 	 	“Retirement Date”
	 	 	9	 
	2.37	 	 	“Severance from Service Date”
	 	 	9	 
	2.38	 	 	“Sponsoring Company”
	 	 	9	 
	2.39	 	 	“Tax Benefit Plan”
	 	 	9	 
	2.40	 	 	“Termination of Employment”
	 	 	9	 
	2.41	 	 	“Total and Permanent Disability”
	 	 	10	 
	2.42	 	 	“Trust”
	 	 	10	 
	2.43	 	 	“Trust Agreement”
	 	 	10	 
	2.44	 	 	“Trust Fund”
	 	 	10	 
	2.45	 	 	“Trustee”
	 	 	10	 
	2.46	 	 	“Valuation Date”
	 	 	10	 
	2.47	 	 	“Valuation Period”
	 	 	10	 
	2.48	 	 	Whenever a noun, or a pronoun in lieu thereof
	 	 	10	 
	2.49	 	 	The words “herein,” “hereof,” and “hereunder”
	 	 	10	 
	2.50	 	 	The expressions listed below
	 	 	10	 
	ARTICLE III	 	REQUIREMENTS FOR ELIGIBILITY AND PARTICIPATION
	 	 	 	 
	3.01	 	 	Service
	 	 	13	 
	3.02	 	 	Employment with a Predecessor Employer
	 	 	14	 
	3.03	 	 	Eligibility Year of Service
	 	 	14	 
	3.04	 	 	Reemployment of Participants
	 	 	14	 
	3.05	 	 	Change in Status of Eligible Employee
	 	 	14	 
	3.06	 	 	Participation in the Plan
	 	 	14	 
	3.07	 	 	Participation After March 1, 1995
	 	 	15	 
	3.08	 	 	Participation After July 1, 1998
	 	 	15	 
	3.09	 	 	Special Rule for Employees of Cabot Corporation or Texas-New
Mexico Power Company
	 	 	15	 
	3.10	 	 	Periods of Military Service
	 	 	15	 
	ARTICLE IV	 	CONTRIBUTIONS
	 	 	 	 
	4.01	 	 	Company Contributions
	 	 	15	 
	4.02	 	 	Elective Contributions
	 	 	16	 
	4.03	 	 	Limitations on Elective Contributions
	 	 	16	 
	4.04	 	 	Company Matching Contributions
	 	 	23	 
	4.05	 	 	Date of Payment and Allocation of Company Contributions, Company
Matching Contributions and Elective Contributions	 	 	23	 
	4.06	 	 	Limitation on Company Matching Contributions
	 	 	24	 
	4.07	 	 	Rollovers
	 	 	28	 
	4.08	 	 	In-Service Withdrawals
	 	 	29	 
	ARTICLE V	 	ALLOCATION TO PARTICIPANTS’ ACCOUNTS
	 	 	 	 
	5.01	 	 	Method of Allocating Company Matching Contributions
	 	 	31	 
	5.02	 	 	Allocation to a Participant Transferred to an Affiliated Company
Which Has Not Adopted the Plan	 	 	31	 
	5.03	 	 	Method of Allocating Company Contributions
	 	 	31	 



ii






 




	 	 	 	 	 	 	 	 
	 	 	 	 	 	Page
	5.04	 	 	Limitation on Annual Additions
	 	 	32	 
	5.05	 	 	Limitations on Annual Additions for Employers or Affiliated
Companies Maintaining Other Defined Contribution Plans	 	 	34	 
	5.06	 	 	Limitations on Annual Additions for Employers or Affiliated
Companies Maintaining Defined Benefit Plans	 	 	34	 
	5.07	 	 	Definitions for Purposes of Determining the Annual Addition
Limitations
	 	 	34	 
	5.08	 	 	Cessation of Eligible Employee Status
	 	 	35	 
	ARTICLE VI	 	ACCOUNTS AND VALUATION OF TRUST FUND
	 	 	 	 
	6.01	 	 	Participant’s Accounts
	 	 	35	 
	6.02	 	 	Accounts of Participants Transferred to an Affiliated Company
	 	 	35	 
	6.03	 	 	Valuation of the Trust Fund and Account Statements
	 	 	36	 
	6.04	 	 	Periodic Determination of Participant’s Accounts
	 	 	36	 
	6.05	 	 	Correction of Participants’ Accounts
	 	 	38	 
	6.06	 	 	Transfers To Non-Bargaining Unit NCE Plan
	 	 	38	 
	ARTICLE VII	 	RETIREMENT BENEFITS
	 	 	 	 
	ARTICLE VIII	 	DISABILITY BENEFITS
	 	 	 	 
	8.01	 	 	Disability Retirement Benefits
	 	 	39	 
	8.02	 	 	Determination of Disability
	 	 	39	 
	ARTICLE IX	 	DEATH BENEFITS
	 	 	 	 
	9.01	 	 	Death Benefits
	 	 	39	 
	9.02	 	 	Designation of Beneficiaries
	 	 	40	 
	ARTICLE X	 	EMPLOYMENT TERMINATION BENEFITS
	 	 	 	 
	ARTICLE XI	 	PAYMENT OF BENEFITS
	 	 	 	 
	11.01	 	 	Time and Method for Distribution of Benefits
	 	 	41	 
	11.02	 	 	Limitations on Timing
	 	 	43	 
	11.03	 	 	Payments on Personal Receipt Except in Case of Minors or Persons
Under a Legal Disability
	 	 	43	 
	11.04	 	 	Distribution Limitations Applicable to Elective Contributions
	 	 	44	 
	11.05	 	 	Distribution Limitations Applicable to ESOP Accounts
	 	 	44	 
	11.06	 	 	Direct Rollovers to Eligible Retirement Plans
	 	 	45	 
	ARTICLE XII	 	MISCELLANEOUS PROVISIONS RESPECTING
PARTICIPANTS
	 	 	 	 
	12.01	 	 	Participants to Furnish Required Information
	 	 	46	 
	12.02	 	 	Participants’ Rights in Trust Fund
	 	 	46	 
	12.03	 	 	Inalienability of Benefits
	 	 	47	 
	12.04	 	 	Conditions of Employment Not Affected by Plan
	 	 	48	 
	12.05	 	 	Address for Mailing of Benefits
	 	 	48	 



iii






 




	 	 	 	 	 	 	 	 
	 	 	 	 	 	Page
	12.06	 	 	Unclaimed Account Procedure
	 	 	48	 
	ARTICLE XIII	 	ADMINISTRATION OF THE PLAN
	 	 	 	 
	13.01	 	 	Appointment of Committee
	 	 	49	 
	13.02	 	 	Compensated Expenses of the Committee
	 	 	50	 
	13.03	 	 	Secretary and Agents of the Committee
	 	 	50	 
	13.04	 	 	Actions of Committee
	 	 	50	 
	13.05	 	 	Authority of Committee
	 	 	51	 
	13.06	 	 	General Administrative Powers
	 	 	51	 
	13.07	 	 	Plan Administrator
	 	 	51	 
	13.08	 	 	Duties of Administrative Personnel
	 	 	51	 
	13.09	 	 	Designation of Named Fiduciaries and Allocation of Responsibility
	 	 	52	 
	13.10	 	 	Action by Fiduciaries
	 	 	52	 
	13.11	 	 	Appointment of Professional Assistants and the Investment Manager
	 	 	53	 
	13.12	 	 	Bond
	 	 	53	 
	13.13	 	 	Indemnity
	 	 	53	 
	13.14	 	 	Payment of Expenses
	 	 	54	 
	ARTICLE
XIV	 	INVESTMENT IN TRUST FUND
	 	 	 	 
	14.01	 	 	Investment in Company Stock Fund
	 	 	54	 
	14.02	 	 	Participant Investment Direction
	 	 	55	 
	14.03	 	 	Diversification of Participant’s Accounts
	 	 	57	 
	14.04	 	 	Funding Policy
	 	 	57	 
	14.05	 	 	Reservation of Cash
	 	 	57	 
	14.06	 	 	Voting of Company Stock; Tender Offers
	 	 	58	 
	ARTICLE XV	 	PARTICIPATION BY EMPLOYERS
	 	 	 	 
	15.01	 	 	Adoption of Plan by Affiliated Company
	 	 	59	 
	15.02	 	 	Rights and Obligations of the Sponsoring Company and the Employers
	 	 	60	 
	15.03	 	 	Withdrawal from Plan
	 	 	60	 
	ARTICLE XVI	 	AMENDMENT OF THE PLAN
	 	 	 	 
	16.01	 	 	Authority to Amend
	 	 	60	 
	16.02	 	 	Trustee’s Consent
	 	 	61	 
	16.03	 	 	Limitations of Vesting Changes
	 	 	61	 
	16.04	 	 	Limitations on Other Changes
	 	 	61	 
	16.05	 	 	Statutorily Required Amendments
	 	 	61	 
	ARTICLE
XVII	 	PERMANENCY OF THE PLAN
	 	 	 	 
	17.01	 	 	Right to Terminate Plan
	 	 	62	 
	17.02	 	 	Merger or Consolidation of Plan and Trust
	 	 	62	 
	17.03	 	 	Continuance by Successor Company
	 	 	62	 



iv






 




	 	 	 	 	 	 	 	 
	 	 	 	 	 	Page
	ARTICLE
XVIII	 	DISCONTINUANCE OF CONTRIBUTIONS AND
TERMINATION
	 	 	 	 
	18.01	 	 	Suspension of Contributions
	 	 	62	 
	18.02	 	 	Discontinuance of Contributions
	 	 	62	 
	18.03	 	 	Termination of Plan and Trust
	 	 	63	 
	18.04	 	 	Participant’s Rights to Benefits upon Termination or Partial
Termination of Plan or Complete Discontinuance of Contributions	 	 	63	 
	ARTICLE
XIX	 	EXCLUSIVE BENEFIT OF THE PLAN
	 	 	 	 
	19.01	 	 	Limitation on Reversions
	 	 	63	 
	19.02	 	 	Unallocated Amounts upon Termination of Plan and Trust
	 	 	63	 
	19.03	 	 	Mistake of Fact or Disallowance of Deduction
	 	 	63	 
	19.04	 	 	Failure of Qualification of Plan and Trust
	 	 	64	 
	ARTICLE XX	 	TOP HEAVY PLAN RULES
	 	 	 	 
	ARTICLE XXI	 	ESOP EXEMPT LOAN PROVISIONS
	 	 	 	 
	21.01	 	 	Effect of Article
	 	 	65	 
	21.02	 	 	Definitions
	 	 	65	 
	21.03	 	 	Company Contributions
	 	 	65	 
	21.04	 	 	Release of Shares from Suspense Accounts
	 	 	66	 
	21.05	 	 	Limitations on Annual Additions
	 	 	67	 
	21.06	 	 	Determination of Net Earnings and Adjustments in Value
	 	 	67	 
	21.07	 	 	Voting of Company Stock
	 	 	67	 
	21.08	 	 	Tender Offer on Company Stock
	 	 	67	 
	21.09	 	 	Forfeiture of Accounts
	 	 	67	 
	21.10	 	 	Distribution of Benefits
	 	 	68	 
	21.11	 	 	Further Conditions
	 	 	68	 
	ARTICLE
XXII	 	MISCELLANEOUS
	 	 	 	 
	22.01	 	 	Effect of Bankruptcy and Other Contingencies Affecting an Employer
	 	 	68	 
	22.02	 	 	Benefits Payable by Trust
	 	 	68	 
	22.03	 	 	Withholding
	 	 	68	 
	22.04	 	 	Interpretation of the Plan and Trust
	 	 	69	 
	22.05	 	 	Provisions Hereof for Sole Benefit of Parties Hereto and Participants
	 	 	69	 
	22.06	 	 	Article and Section Headings
	 	 	69	 
	22.07	 	 	Formal Action by Employer
	 	 	69	 
	22.08	 	 	Right to Require Repurchase of Shares of Company Stock
	 	 	69	 
	22.09	 	 	Restrictions on Transfer of Company Stock
	 	 	71	 
	22.10	 	 	APPLICABLE LAW
	 	 	72	 



APPENDIX RELATED TO XCEL MERGER



v






 




NEW CENTURY ENERGIES, INC.

EMPLOYEE INVESTMENT PLAN FOR

BARGAINING UNIT EMPLOYEES AND

FORMER NON-BARGAINING UNIT EMPLOYEES



(As Amended and Restated Effective January 1, 2002

But With Certain Retroactive Amendments)



ARTICLE I



PURPOSE AND ESTABLISHMENT OF THE PLAN



     1.01 Establishment of the Plan. Southwestern Public Service Company
previously adopted and established a tax benefit, investment savings stock
bonus plan (the “Tax Benefit Plan”) for the exclusive benefit of its eligible
employees and their beneficiaries, effective as of March 1, 1985. Subsequent
thereto, the Tax Benefit Plan was amended from time to time and was adopted by
certain Affiliated Companies. Effective as of September 1, 1989, Southwestern
Public Service Company and certain Affiliated Companies amended and restated
the Tax Benefit Plan in its entirety, and effective December 1, 1994, the Tax
Benefit Plan was amended to satisfy the requirements of an employee stock
ownership plan and to permit the distribution of cash dividends to
participants.


     Effective as of September 1, 1974, Southwestern Public Service Company
adopted and established a tax credit employee stock ownership plan and trust
(the “ESOP”) for the benefit of its eligible employees. Subsequent thereto,
the ESOP was amended from time to time, and was adopted by certain Affiliated
Companies. Effective as of September 1, 1989, Southwestern Public Service
Company and certain Affiliated Companies amended and restated the ESOP in its
entirety.


     Effective as of March 1, 1995 (the “Effective Date”), Southwestern Public
Service Company and certain Affiliated Companies, merged the ESOP into the Tax
Benefit Plan creating the Southwestern Public Service Company Employee
Investment Plan, a new stock bonus/employee stock ownership plan as a
continuation of the Tax Benefit Plan in accordance with the terms and
conditions hereinafter set forth.


     Except as otherwise provided herein, and subject to the following
sentence, the provisions of the Plan as contained herein are applicable to
Employees and Participants who die, retire, suffer Total and Permanent
Disability or Termination of Employment on or after March 1, 1995, or who are
reemployed by an Employer or Affiliated Company on or after March 1, 1995.
Except as otherwise provided herein, any employee or participant in either the
ESOP or the Tax Benefit Plan who died, retired, became disabled or terminated
employment prior to March 1, 1995 shall receive any benefits to which he or she
is entitled based upon the appropriate provisions of the ESOP or Tax Benefit
Plan, as the case may be, as in effect prior to March 1, 1995.


1






 


     Effective July 1, 1998, the portion of this Plan consisting of the
accounts of the Plan Participants who were eligible employees on June 30, 1998,
was spun off into a separate plan, and this Plan was renamed the New Century
Energies, Inc. Employee Investment Plan for Bargaining Unit Employees and
Former Non-Bargaining Unit Employees. Effective as of the date of the merger
of New Century Energies, Inc. and Northern States Power Company to form Xcel
Energy Inc., Xcel Energy Inc. is substituted in place of New Century Energies,
Inc. as the Sponsoring Company.


     This plan document was amended and restated generally effective January 1,
2002 but with certain retroactive amendments required by changes in the law.


     1.02 Purpose. The purposes of the Plan are to encourage employee thrift
and savings by allowing eligible employees to enter into a cooperative savings
program ( with their employer, to provide an additional opportunity for
eligible employees to share in the growth and prosperity of the Sponsoring
Company and to provide eligible employees with an opportunity to accumulate
additional capital for their future economic security. The primary purpose of
the Plan is to enable Participants to acquire stock ownership interests in the
Sponsoring Company, and therefore, the Plan is designed to invest primarily in
Company Stock. To provide all of the intended benefits described herein, a
Participant must elect to defer a portion of his Compensation through salary
reduction, and the Employer will contribute an amount which, in part, will be
allocated on the basis of the salary reduction deferred amounts and, in part,
allocated on the basis of Compensation, as well as an amount equal to the
salary reduction deferred amounts. Such contributions and any income derived
therefrom shall be for the exclusive benefit of the Employers’ employees and
their beneficiaries and shall not be used for, or diverted to, any other
purpose except as otherwise provided in Article XIX of the Plan.


     It is the intention of the Employers that the Plan shall continue to meet
all of the requirements necessary or appropriate to qualify it as an employee
stock ownership plan with a cash or deferred arrangement feature, under Code
Sections 401(a), 401(k), 409 (where applicable) and 4975(e)(7) and, if and
where appropriate, with respect to the tax credit employee stock ownership plan
features, Section 301(d) of the Tax Reduction Act of 1975, and Sections 41, 44G
and 409(A) (or 409, where applicable) of the Internal Revenue Code of 1954, as
amended, and that the Trust made a part hereof shall continue to be exempt from
tax under Code Section 501(a) and all provisions hereof shall be interpreted
accordingly.


     1.03 Trust Agreement. In furtherance of this Plan, the trust agreements
under the ESOP and the Tax Benefit Plan are being amended and restated to
create the Trust Agreement, effective as of March 1, 1995, which is made a part
hereof, for the purpose of maintaining the Trust to fund the benefits of this
Plan as hereinafter set forth.


ARTICLE II



DEFINITIONS



     As used in the Plan:


     2.01 “Account” or “Accounts” shall mean all or any of the Company
Contribution Account, the ESOP Employer Contribution Account, the ESOP Employee
Contribution Account,


2






 


the Company Matching Contribution Account, the Employee Elective
Contribution Account, the Rollover Account and the QDRO Account to the extent
any one or more of such accounts have been created for a Participant,
Beneficiary or Alternate Payee. Any of the Accounts may have such subaccounts
as are from time to time administratively necessary, as determined by the
Committee.


     2.02 “Affiliated Company” shall mean any of the following which itself is
not an Employer: (i) a member of a controlled group of corporations of which
an Employer is a member as defined in Code Section 414(b), (ii) any trade or
business (whether or not incorporated) which is under common control with an
Employer as determined in accordance with Code Section 414(c) and regulations
issued thereunder, (iii) a member of an “affiliated service group” (whether or
not incorporated) as determined in accordance with Code Section 414(m) and
regulations issued thereunder, of which an Employer is a member, or (iv) any
other entity which is required to be aggregated with an Employer in accordance
with Code Section 414(o) and the regulations issued thereunder. “Affiliated
Company” as defined in clauses (i) and (ii) shall be modified as required by
Code Section 415(h) when used in Sections 5.04, 5.05 and 5.06 hereof with
respect to limitations on Annual Additions.


     2.03 “Alternate Payee” shall mean an individual or trust entitled to
benefits under the Plan pursuant to a Qualified Domestic Relations Order.


     2.04 “Beneficiary” shall mean any person or entity entitled to receive
benefits which are payable upon or after a Participant’s death pursuant to
Article IX hereof.


     2.05 “Board” shall mean the Board of Directors of the Sponsoring Company,
as from time to time constituted.


     2.06 “Code” shall mean the Internal Revenue Code of 1986, as amended from
time to time. References to any section of the Internal Revenue Code shall
include any successor provision thereto.


     2.07 “Committee” shall mean the Committee provided for in Section 13.01
hereof. “Committee” shall have the same meaning as Committee as defined in the
Tax Benefit Plan.


     2.08 “Company Contribution Account” shall mean the separate account
maintained for each Participant reflecting Company Contributions and
Forfeitures allocated to such Participant in accordance with Sections 4.01 and
5.03 hereof, as adjusted in accordance with the provisions of Article VI
hereof.


     2.09 “Company Matching Contribution Account” shall mean the separate
account maintained for each Participant reflecting Company Matching
Contributions allocated to such Participant as provided in Sections 4.04 and
5.01 hereof, as adjusted in accordance with the provisions of Article VI hereof
and shall include the amounts held in the Company Contribution Account under
the Tax Benefit Plan.


     2.10 “Company Stock” shall mean (a) the common stock issued by the
Sponsoring Company (or by a corporation which is a member of the same
controlled group, as determined under Code Section 409(l)(4)) which is readily
tradable on an established securities market, or


3






 


(b)  if there is no common stock which meets the requirements of clause (a)
above, the common stock issued by the Sponsoring Company (or by a corporation
which is a member of the same controlled group) having a combination of voting
power and dividend rights equal to or in excess of (i) that class of common
stock of the Sponsoring Company (or of any other such corporation) having the
greatest voting power, and (ii) that class of common stock of the Sponsoring
Company (or of any other such corporation) having the greatest dividend rights.


     2.11 “Compensation” shall mean base compensation as reflected on the
Employer’s payroll records actually paid by an Employer to an Employee during
the Plan Year, including an Employee’s Elective Contributions under this Plan
and an Employee’s elective salary deferrals pursuant to Code Section 125 or
commencing January 1, 2001 pursuant to Code Section 132(f)(4), but excluding
overtime, bonuses, commissions, moving expense allowances and other
extraordinary compensation, and excluding Company Contributions or any other
Employer contributions to this Plan or employer contributions under any other
employee benefit plan and all other deferred compensation; provided, however,
in the event that an employee is disabled and is receiving payments under any
workers’ compensation laws but is simultaneously receiving compensation from
the Employer, such Participant’s Compensation for the period while receiving
such workers’ compensation payments shall be based upon his rate of pay from
the Employer as in effect from time to time during such period determined
without regard to the fact that such Participant is receiving payments under
any workers’ compensation laws.


     Compensation shall not include any Compensation in excess of One Hundred
Fifty Thousand Dollars ($150,000) for Plan Years commencing on or after January
1, 1994 and before January 1, 1997; in excess of One Hundred Sixty Thousand
Dollars ($160,000) for Plan Years commencing on or after January 1, 1997 and
before January 1, 2000; and in excess of One Hundred Seventy Thousand Dollars
($170,000) for Plan Years commencing on or after January 1, 2000.


     In applying the compensation limitation for Plan Years commencing prior to
January 1, 1997, the family group of a Highly Compensated Employee who is
subject to the family member aggregation rules of Code Section 414(q)(6)
because such Employee is either a five percent owner of the Employer or one of
the ten (10) Highly Compensated Employees paid the greatest Limitation Year
Compensation during the year, shall be treated as a single Participant, except
that for this purpose, Family Members shall include only the affected
Participant’s spouse and any lineal descendants who have not attained age
nineteen (19) before the close of the year. In the event the Highly
Compensated Employee’s and one or more Family Member’s Compensation for a Plan
Year from an Employer are limited pursuant to the provisions of this Section,
then the Compensation of each such person for such Plan Year shall be reduced
proportionately based on the ratio of their respective Compensation to the
aggregate Compensation of both (or all) of such persons for such Plan Year.


     2.12 “Date of Employment” or “Date of Reemployment” shall mean the day on
which an Employee first commences employment or reemployment following
Termination of Employment, retirement after attaining his Retirement Date-or
recovery from Total and Permanent Disability, as the case may be, with an
Employer or an Affiliated Company by performing an Hour of Service.


4






 


     2.13 “Elective Contributions” shall mean the amount each Participant has
elected to have the Employer contribute on his behalf, in lieu of cash
compensation, pursuant to the provisions of Section 4.02 hereof. Such amounts
are intended to qualify as elective contributions under Code Section 401(k) and
the regulations thereunder. “Elective Contributions” shall also mean Elective
Contributions as defined in and made to the Tax Benefit Plan.


     2.14 “Eligible Employee” shall mean any Employee who is employed in a
bargaining unit covered by a collective bargaining agreement that provides for
participation in this Plan. However, the following Employees are not Eligible
Employees: (i) a nonresident alien who receives no earned income within the
meaning of Code Section 911(b), (ii) any Employee who is a “leased employee” as
defined in Section 2.15 hereof and (iii) from and after the date on which
occurs the “Effective Time” of the “Mergers” pursuant to Section 1.4 of the
Agreement and Plan of Reorganization by and among Public Service Company of
Colorado, Southwestern Public Service Company and M-P New Co., dated as of
August 22, 1995 (the “Merger Effective Date”), any Employee who is not hired by
an Employer to work in the geographic area comprising the service area of
Southwestern Public Service Company immediately prior to the Merger Effective
Date.


     2.15 “Employee” shall mean any person who is employed by one or more
Employers, is on an Employer’s payroll, and whose wages are subject to FICA
withholding. Employee also includes any person who is not employed by an
Employer but is performing services for an Employer pursuant to an agreement
between such Employer or an Affiliated Company and a leasing organization and
who is a “leased employee” as that term is defined in Code Section 414(n). A
“leased employee” shall not be an Employee, however, if (1) such person is
covered by a money purchase pension plan qualified under Code Section 401(a)
providing (i) a nonintegrated employer contribution rate of at least ten (10)
percent of Limitation Year Compensation as defined in Subsection 5.07(5)
hereof, but including amounts contributed pursuant to a salary reduction
agreement which are excludable from such person’s gross income under Code
Sections 125, 402(a)(8), 402(h) or 403(b), (ii) immediate participation, and
(iii) full and immediate vesting, and (2) “leased employees” do not constitute
more than twenty percent (20%) of the Employer’s or Affiliated Company’s work
force who are Non-Highly Compensated Employees. However, except to the extent
otherwise provided in regulations under Code Section 414(n), in the event a
“leased employee” subsequently becomes an Employee as defined herein, the
period from and after January 1, 1984 during which said leased employee
performed services for an Employer or an Affiliated Company as a leased
employee shall be taken into account in determining such person’s Eligibility
Years of Service under the Plan in accordance with and subject to the remainder
of the provisions of the Plan, as if such employee were employed by an Employer
or an Affiliated Company during such period.


     2.16 “Employee Elective Contribution Account” shall mean the separate
account maintained for each Participant reflecting the Elective Contributions
made on behalf of such Participant pursuant to Section 4.02 hereof, if any, as
adjusted in accordance with the provisions of Article VI of the Plan, and shall
include amounts held in the Elective Contribution Account under the Tax Benefit
Plan.


5






 


     2.17 “Employer” shall mean the Sponsoring Company, Southwestern Public
Service Company, Utility Engineering Corporation, Quixx Corporation, or any
other Affiliated Company which adopts the Plan pursuant to Article XV hereof.


     2.18 “ERISA” shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time. References to any Section of ERISA shall
include any successor provision thereto.


     2.19 “ESOP” shall mean the Southwestern Public Service Company Employee
Stock Ownership Plan and Trust as in effect at any time and from time to time
on and prior to February 28, 1995, as the context so requires.


     2.20 “ESOP Employee Contribution Account” shall mean the separate account
maintained for each Participant who was a participant in the ESOP consisting of
the contributions made by the participant as described in Section 5(a) of the
ESOP as in effect on and prior to February 28, 1995, plus earnings and/or
losses (including appreciation and depreciation) credited to such contributions
under the ESOP and credited to such Account hereunder. Any amounts credited to
a Participant’s ESOP Employee Contribution Account shall at all times, be fully
vested and nonforfeitable.


     2.21 “ESOP Employer Contribution Account” shall mean the separate account
maintained for each Participant who was a participant in the ESOP consisting of
the contributions made by the Employers as described in Sections 2.02(a),
2.02(b), 2.02(c) and 5(b)(i)(A) of the ESOP as in effect on and prior to
February 28, 1995, plus earnings and/or losses (including appreciation and
depreciation) credited to such contributions under the ESOP and credited to
such Account hereunder. Any amounts credited to a Participant’s ESOP Employer
Contribution Account shall at all times, for all purposes and in all respects
be fully vested and nonforfeitable.


     2.22 “Fiscal Year” shall mean the fiscal year of an Employer. The Fiscal
Year of the Sponsoring Company ends on August 31.


     2.23 “Hour of Service” shall mean each hour for which an Employee is paid
or entitled to payment for the performance of duties for an Employer or an
Affiliated Company.


     2.24 “Investment Manager” shall mean any fiduciary other than the trustee
or a Named Fiduciary that: (i) is either (a) registered as an investment
adviser under the Investment Advisers Act of 1940 and registered under the laws
of Texas, or (b) a bank (as defined in the Investment Advisers Act of 1940), or
(c) an insurance company qualified to manage, acquire or dispose of Plan assets
under the laws of more than one state, (ii) acknowledges in writing that it is
a fiduciary with respect to the Plan, and (iii) is granted the power to manage,
acquire or dispose of any asset of the Plan pursuant to Section 13.11 hereof.


     2.25 “Leave of Absence” shall mean an absence from the active employment
of an Employer by reason of an approved absence granted by such Employer on the
basis of a uniform policy applied by such Employer without discrimination.


6






 


     2.26 “One-Year Period of Severance” shall mean a twelve (12)-consecutive
month Period of Severance.


          Notwithstanding any other provision of this Section 2.26 to the contrary,
solely for purposes of determining whether an Employee has a One-Year Period of
Severance, in the case of an Employee who is first absent from work for any
period: (i) by reason of (a) the Employee’s pregnancy, (b) the birth of the
Employee’s child, (c) the placement of a child with the Employee in connection
with adoption of such child by the Employee, or (ii) for the purpose of caring
for such child for a period beginning immediately following such birth or
placement, the (12)-consecutive month period beginning on the first anniversary
of the first date of such absence shall not constitute a One-Year Period of
Severance. The period between the first and second anniversaries of the first
date of such absence is neither a Period of Service nor a Period of Severance.
Notwithstanding the provisions of this Section, no credit shall be given
pursuant to this Section unless the Employee furnishes the Committee with such
information as the Committee shall require to establish: (i) that the absence
from work was for the reasons referred to herein, and (ii) the number of days
for which there was such an absence.



     2.27 “Participant” shall mean an Eligible Employee who participates in
the Plan as provided in Article III hereof or a former Employee who has a
vested interest in the Plan.


     2.28 “Period of Service” shall mean the period of time commencing on an
Employee’s Date of Employment or Date of Reemployment, as the case may be, and
ending on such Employee’s Severance from Service Date. For the period prior to
the Effective Date, a Participant’s or Employee’s Period of Service shall equal
his Period of Service under the ESOP, if greater than his Period of Service as
defined herein. A Period of Service shall also include a Period of Severance
of twelve (12) consecutive months or less. Notwithstanding the preceding
sentence:


          2.28(1) If an Employee who is on Leave of Absence or is temporarily laid
off, retires or terminates employment during the first twelve (12) months of
such Leave of Absence or temporary layoff, as the case may be, such Employee’s
Period of Service shall not include any Period of Severance beginning on the
date such Employee retired after attaining his Retirement Date or the date he
terminated employment and ending on such Employee’s Date of Reemployment, if
any, so long as such Date of Reemployment does not occur within the twelve (12)
month period commencing on the date such Leave of Absence or temporary layoff
began.



          2.28(2) If an Employee works simultaneously for more than one Employer
and/or Affiliated Company, the total Period of Service for such Employee shall
not be increased by reason of such simultaneous employment.



          2.28(3) In the case of any Employee (i) who became an employee of
Southwestern Public Service Company on November 1, 1982 as a result of the
merger of Cochran Power & Light Company (“CP&L”) into Southwestern Public
Service Company and who immediately prior to such merger was an employee of
CP&L (a “Former CP&L Employee”), (ii) who became an employee of Southwestern
Public Service Company on May 5, 1983 as a result of the acquisition of the
business and assets of New Mexico Electric Service Company (“NME”) by
Southwestern Public Service Company and who immediately prior to such
acquisition was an employee of NME (a “Former NME Employee”), or (iii) who is a



7






 





Former CP&L Employee and who immediately prior to commencing employment
with CP&L was employed by NME, so that his employment with said two companies
prior to becoming an employee of Southwestern Public Service Company was
continuous and uninterrupted (a “Former CP&L/NME Employee”), “Period of
Service” shall include such employee’s period of employment with NME and/or
CP&L, as the case may be, beginning with such employee’s last date of hire by
CP&L, in the case of a Former CP&L Employee, or by NME, in the case of a Former
NME Employee or a Former CP&L/NME Employee.


     2.29 “Period of Severance” shall mean the period of time commencing on an
Employee’s Severance from Service Date and ending on such Employee’s Date of
Reemployment, if any.


     2.30 “Plan” shall mean the New Century Energies, Inc. Employee Investment
Plan for Bargaining Unit Employees and Former Non-Bargaining Unit Employees as
set forth in this document, and as hereafter amended.


     2.31 “Plan Quarter” shall mean the quarter-annual portion beginning on
each January 1, April 1, July 1 and October 1. The month of December, 1998 was
also treated as a Plan Quarter for purposes of this Plan.


     2.32 “Plan Year” shall mean, commencing on January 1, 1999, the calendar
year. Prior to September 1, 1998, the Plan Year was the 12-consecutive month
period ending on August 3l. The period from September 1, 1998 to December 31,
1998 was a short Plan Year.


     2.33 “QDRO Account” shall mean that part of any other Account which has
been isolated from such Account for the benefit of an Alternate Payee pursuant
to a Qualified Domestic Relations Order.


     2.34 “Qualified Domestic Relations Order” shall mean a judgment, order or
decree which:


          2.34(1) Relates to the provision of child support, alimony payments, or
marital property rights to a spouse, former spouse, child, or other dependent
of a Participant; and



          2.34(2) Is made pursuant to a state domestic relations law (including a
community property law); and



          2.34(3) Creates or recognizes the existence of an Alternate Payee’s right
to, or assigns to an Alternate Payee the right to, receive all or a portion of
the benefits payable with respect to a Participant under the Plan; and



          2.34(4) Is determined by the Plan Administrator to meet all applicable
requirements pursuant to the procedure established by the Committee for
determining whether an order is a Qualified Domestic Relations Order pursuant
to Code Section 414(p).



     2.35 “Required Beginning Date” shall mean April 1 of the calendar year
following the calendar year in which the Participant attains age seventy and
one-half (70-1/2).


8






 



     2.36 “Retirement Date” shall mean the date on which occurs the
Participant’s sixty-fifth (65th) birthday.


     2.37 “Severance from Service Date” shall mean the earlier of:


          2.37(1) The date on which an Employee suffers a Termination of
Employment, retires after attaining his Retirement Date or after sustaining
Total and Permanent Disability or dies; or



          2.37(2) In the case of an Employee on Leave of Absence who does not
return to the active employment of the Employer or an Affiliated Company at or
( prior to the expiration of such Leave of Absence, the earlier of (i) the
expiration date of such Leave of Absence, or (ii) the date which is twelve (12)
months after the date on which such Leave of Absence began, or, in the case of
an Employee who becomes absent (whether the absence is with or without pay)
from the active employment of an Employer or an Affiliated Company by reason of
a temporary layoff, the date which is twelve (12) months after the date on
which such Employee first becomes absent.



     2.38 “Sponsoring Company” shall mean Xcel Energy Inc.


     2.39 “Tax Benefit Plan” shall mean the Southwestern Public Service
Company Tax Benefit Plan as in effect at any time and from time to time on and
prior to February 28, 1995, as the context so requires.


     2.40 “Termination of Employment” shall mean the earlier of (i) the
termination of employment with all Employers and all Affiliated Companies,
whether voluntarily or involuntarily, other than by reason of a Participant’s
retirement after attaining his Retirement Date or as otherwise provided in
Article VII hereof, or after sustaining Total and Permanent Disability, or
death, or (ii) in the case of an Employee on Leave of Absence who does not
return to the active employment of the Employer or an Affiliated Company at or
prior to the expiration of such Leave of Absence, the earlier of (i) the
expiration date of such Leave of Absence, or (ii) the date which is twelve (12)
months after the date on which such Leave of Absence began, or, in the case of
an Employee who becomes absent (whether the absence is with or without pay)
from the active employment of an Employer or an Affiliated Company by reason of
layoff, the date which is twelve (12) months after the date on which such
Employee first becomes absent. A Leave of Absence will not constitute a
Termination of Employment provided the Employee returns to the active
employment of the Employer at or prior to the expiration of his leave, or if
not specified therein, within the period of time which accords with such
Employer’s policy with respect to permitted absences. Notwithstanding the
foregoing provisions of this Section, absence from the active service of the
Employer because of military service will be considered a Leave of Absence
granted by an Employer and will not terminate the employment of an Employee if
he returns to the active employment of an Employer within the period of time
during which he has reemployment rights under any applicable federal law or
within sixty (60) days from and after discharge or separation from such
military service if no federal law is applicable. However, no provision of
this Section or of the remainder of the Plan shall require reemployment of any
Employee whose active service with an Employer was terminated by reason of
military service.


9






 



     2.41 “Total and Permanent Disability” shall mean the determination under
the Employer’s Long-Term Disability Plan that the Participant is eligible to
receive a disability benefit.


     2.42 “Trust” shall mean the legal entity resulting from the Trust
Agreement between the Sponsoring Company and the Trustee who receives the
contributions under the Plan, as well as the amounts held under the trusts
funding the ESOP and the Tax Benefit Plan, and holds, invests, and disburses
funds to or for the benefit of Participants and their Beneficiaries.


     2.43 “Trust Agreement” shall mean the instrument establishing the Trust,
as amended from time to time.


     2.44 “Trust Fund” shall mean all assets of whatsoever kind or nature from
time to time held by the Trustee pursuant to the Trust Agreement without
distinction as to income and principal.


     2.45 “Trustee” shall mean the party or parties, individual or corporate,
named in the Trust Agreement and any duly appointed additional or successor
Trustee or Trustees acting thereunder.


     2.46 “Valuation Date” shall mean each business day.


     2.47 “Valuation Period” shall mean the period from the close of business
on the previous Valuation Date to the close of business on the current
Valuation Date.


     2.48 Whenever a noun, or a pronoun in lieu thereof, is used in this Plan
in plural form and there be only one person, thing or institution within the
scope of the word so used, or in singular form and there be more than one
person, thing or institution within the scope of the word so used, such word,
or the pronoun used in lieu thereof, shall have a plural or singular meaning,
as the case may be. Pronouns of the masculine gender may mean the feminine and
vice versa.


     2.49 The words “herein,” “hereof,” and “hereunder” shall refer to the
Plan.


     2.50 The expressions listed below shall have the meanings stated in the
Sections or Subsections hereof respectively indicated:



	 	 	 	 	 
	 	 	
“Actual Contribution Percentage” or “ACP”
	 	Subsection 4.06(1);
	 	 	 	 	Subsection 4.06(7)(a)
	 	 	 	 	 
	 	 	
“Actual Deferral Percentage” or “ADP”
	 	Subsection 4.03(1);
	 	 	 	 	Subsection 4.03(8)(a)
	 	 	 	 	 
	 	 	
“Aggregated Family Group”
	 	Subsection 4.03(8)(f);
	 	 	 	 	Subsection 4.06(7)(b)
	 	 	 	 	 
	 	 	
“Annual Additions”
	 	Section 5.04



10






 




	 	 	 	 	 
	 	 	
“Cash Dividend Account”
	 	Subsection 6.04(4)(a)
	 	 	 	 	 
	 	 	
“Company Contribution”
	 	Section 4.01
	 	 	 	 	 
	 	 	
“Company Matching Contribution”
	 	Section 4.04
	 	 	 	 	 
	 	 	
“Company Stock Fund”
	 	Subsection 14.01(1)
	 	 	 	 	 
	 	 	
“Compensation”
	 	Section 2.11
	 	 	 	 	 
	 	 	
“Current Value”
	 	Subsection 6.03(1)
	 	 	 	 	 
	 	 	
“Defined Benefit Plan”
	 	Subsection 5.07(2);
	 	 	 	 	 
	 	 	
“Defined Contribution Plan”
	 	Subsection 5.07(3);
	 	 	 	 	 
	 	 	
“Direct Rollover”
	 	Subsection 11.06(2)(iv)
	 	 	 	 	 
	 	 	
“Distributee”
	 	Subsection 11.06(2)(iii)
	 	 	 	 	 
	 	 	
“Effective Date”
	 	Section 1.01
	 	 	 	 	 
	 	 	
“Eligibility Year of Service”
	 	Section 3.03
	 	 	 	 	 
	 	 	
“Eligible Participant”
	 	Section 14.03
	 	 	 	 	 
	 	 	
“Eligible Retirement Plan”
	 	Subsection 11.06(2)(ii)
	 	 	 	 	 
	 	 	
“Eligible Rollover Distribution”
	 	Subsection 11.06(2)(i)
	 	 	 	 	 
	 	 	
“Eligible Shares”
	 	Section 14.03
	 	 	 	 	 
	 	 	
“Employee Participant”
	 	Subsection 4.03(8)(d);
	 	 	 	 	Subsection 4.06(7)(b)
	 	 	 	 	 
	 	 	
“Entry Date”
	 	Section 3.01
	 	 	 	 	 
	 	 	
“Excess Aggregate Contributions”
	 	Subsection 4.06(3)
	 	 	 	 	 
	 	 	
“Excess Contributions”
	 	Subsection 4.03(3)
	 	 	 	 	 
	 	 	
“Excess Deferrals”
	 	Subsection 4.03(7)
	 	 	 	 	 
	 	 	
“Family Member”
	 	Subsection 4.03(8)(f);
	 	 	 	 	Subsection 4.06(7)(b)
	 	 	 	 	 
	 	 	
“Forfeiture”
	 	Subsection 12.06(2)
	 	 	 	 	 
	 	 	
“Former Employees”
	 	Subsection 4.03(8)(b)



11






 




	 	 	 	 	 
	 	 	 	 	 
	 	 	
“Hardship”
	 	Subsection 4.08(1)
	 	 	 	 	 
	 	 	
“Highly Compensated Employee”
	 	Subsection 4.03(8)(b);
	 	 	 	 	Subsection 4.06(7)(b)
	 	 	 	 	 
	 	 	
“Investment Funds”
	 	Subsection 14.02(3)
	 	 	 	 	 
	 	 	
“Limitation Year”
	 	Subsection 5.07(4)
	 	 	 	 	 
	 	 	
“Limitation Year Compensation”
	 	Subsection 4.03(8)(b);
	 	 	 	 	Subsection 5.07(5);
	 	 	 	 	 
	 	 	
“Named Fiduciaries”
	 	Section 13.09
	 	 	 	 	 
	 	 	
“Net Earnings and Adjustments in Value of the Trust
Fund”
	 	Subsection 6.04(2)
	 	 	 	 	 
	 	 	
“Non-Highly Compensated Employee”
	 	Subsection 4.03(8)(c);
	 	 	 	 	Subsection 4.06(7)(b)
	 	 	 	 	 
	 	 	
“Offer”
	 	Subsection 14.06(3)
	 	 	 	 	 
	 	 	
“Option Period”
	 	Subsection 22.08(3)
	 	 	 	 	 
	 	 	
“Option Price”
	 	Subsection 22.08(4)
	 	 	 	 	 
	 	 	
“Plan Administrator”
	 	Section 13.07
	 	 	 	 	 
	 	 	
“Promissory Note”
	 	Subsection 21.02(1)
	 	 	 	 	 
	 	 	
“Put”
	 	Subsection 22.08(1)
	 	 	 	 	 
	 	 	
“Qualified Consent”
	 	Subsection 9.02(2)
	 	 	 	 	 
	 	 	
“Retirement Plan”
	 	Subsection 5.07(1)
	 	 	 	 	 
	 	 	
“Rollover Account”
	 	Subsection 4.07(1)
	 	 	 	 	 
	 	 	
“Rollover Contribution”
	 	Subsection 4.07(1);
	 	 	 	 	Subsection 4.07(4)
	 	 	 	 	 
	 	 	
“Salary Reduction Agreement”
	 	Subsection 4.02(1)
	 	 	 	 	 
	 	 	
“Suspense Account”
	 	Subsection 21.02(2)
	 	 	 	 	 
	 	 	
“Tender”
	 	Subsection 14.06(3)
	 	 	 	 	 
	 	 	
“Total Compensation”
	 	Subsection 4.03(8)(e);
	 	 	 	 	Subsection 4.06(7)(b)



12






 




	 	 	 	 	 
	 	 	
“Valuation Date”
	 	Section 2.46;
	 	 	 	 	 
	 	 	
“Yearly Election Period”
	 	Section 14.03



ARTICLE III



REQUIREMENTS FOR ELIGIBILITY AND PARTICIPATION



     3.01 Service. Each Eligible Employee shall become a Participant as of
the January 1, April 1, July 1 or October 1 (the “Entry Date”) coinciding with
or next following the date upon which such Eligible Employee completes an
Eligibility Year of Service, provided such Eligible Employee is so employed on
such Entry Date.


     In the event an Eligible Employee suffers a Termination of Employment
before or after the completion of his Eligibility Year of Service but prior to
the Entry Date upon which such Eligible Employee would have begun participating
in the Plan, and such Eligible Employee is reemployed by an Employer prior to a
twelve (12) consecutive month Period of Severance, such Eligible Employee
shall, upon his reemployment, participate in the Plan as of the Entry Date that
the Participant would have begun participation had the Employee not incurred a
Termination of Employment, and shall be eligible to elect to have made on his
behalf Elective Contributions from and after the later of his Entry Date or his
Reemployment Commencement Date, provided he complies with the provisions of
Section 4.02 hereof.


     In the event an Eligible Employee suffers a Termination of Employment
prior to completing an Eligibility Year of Service or after completing an
Eligibility Year of Service but prior to the Entry Date upon which such
Eligible Employee would have become a Participant, and such Eligible Employee
is reemployed by the Employer after incurring five (5) One-Year Periods of
Severance, such Employee shall be treated as a new Employee with no prior
service for purposes of participation in the Plan.


     In the event an Eligible Employee suffers a Termination of Employment
prior to completing an Eligibility Year of Service or after completing an
Eligibility Year of Service but prior to the Entry Date upon which such
Eligible Employee would have become a Participant, and such Eligible Employee
is reemployed by the Employer after incurring one (1) One-Year Period of
Severance but prior to incurring five (5) One-Year Periods of Severance, such
Employee’s Period of Service prior to the Periods of Severance shall be
aggregated with his Period of Service subsequent to such Periods of Severance
for purposes of determining his eligibility for the Plan, and such Eligible
Employee shall become a Participant as of the later of (i) his Date of
Reemployment, or (ii) the Entry Date coinciding with or next following the date
upon which such Employee completes an Eligibility Year of Service, provided
such Eligible Employee is so employed on such Entry Date.


     In the event an Eligible Employee transfers to an Affiliated Company prior
to or after completing an Eligibility Year of Service but prior to the Entry
Date upon which such Eligible Employee would have become a Participant, and is
employed continuously with an Affiliated Company until his transfer back to an
Employer, such Eligible Employee shall become a Participant as of the later of
(i) the date of his transfer back to an Employer, or (ii) the Entry Date


13






 


coinciding with or next following the date upon which such Employee
completes an Eligibility Year of Service, provided such Eligible Employee is so
employed on such Entry Date.


     3.02 Employment with a Predecessor Employer. If the Plan had previously
been maintained by a predecessor of an Employer, whether a corporation,
partnership, sole proprietorship or other business entity, any period of
employment with such predecessor shall be treated as a period of employment
with an Employer. Effective July 1, 1998, if the Plan had not been previously
maintained by a predecessor of an Employer, employment with such predecessor
shall be taken into account to the extent permitted by regulations prescribed
by the Secretary of the Treasury.


     3.03 Eligibility Year of Service. An “Eligibility Year of Service” shall
mean a Period of Service of three hundred sixty-five (365) days, commencing
with an Employee’s Date of Employment, or, if applicable, an Employee’s Date of
Reemployment, subject to the provisions of Section 3.02 hereof.


     3.04 Reemployment of Participants. In the event that a Participant
incurs a Period of Severance and is subsequently reemployed by an Employer, he
shall resume participation in the Plan for all purposes effective as of his
Date of Reemployment.


     3.05 Change in Status of Eligible Employee.


          3.05(1) In the event an Employee, including an Employee who previously
was not defined as an Eligible Employee under Section 2.14 hereof, becomes
defined as an Eligible Employee, such individual shall become a Participant in
the Plan as of the date he becomes defined as an Eligible Employee, provided he
has met the other requirements for eligibility set forth in Section 3.01 hereof
and previously would have begun to participate in the Plan had he been defined
as an Eligible Employee, or, if he has not met the other requirements for
eligibility set forth in Section 3.01 hereof, as of the Entry Date after he
meets such other eligibility requirements.



          3.05(2) In the event a Participant who ceased to be defined as an
Eligible Employee under Section 2.14 hereof but who did not incur a Termination
of Employment with an Employer or an Affiliated Company subsequently becomes
defined as an Eligible Employee again, such Eligible Employee shall recommence
participation in the Plan for all purposes without regard to the limitations
imposed by Section 5.08 hereof, as of the date he again becomes defined as an
Eligible Employee.



     3.06 Participation in the Plan. Each Eligible Employee who was a
Participant in the ESOP and/or the Tax Benefit Plan immediately prior to the
Effective Date shall be eligible to make Elective Contributions on and after
the Effective Date, provided he is still an Eligible Employee. In addition,
any Designation of Beneficiary on file for such Eligible Employee under the Tax
Benefit Plan shall be a valid Designation under this Plan, unless and until
changed in accordance with the provisions of this Plan. Each other Eligible
Employee who becomes a Participant shall be notified when he is eligible to
make Elective Contributions and shall be provided with such information as is
required by the Plan and by ERISA, within the time prescribed for providing
such information. Each such Participant also shall be provided with a
Designation of Beneficiary Form which shall provide for a designation of one or
more



14










 



Beneficiaries to receive benefits in the event of the Employee’s
death, and shall be provided with such forms as may be necessary to cause
Elective Contributions to be made on his behalf to the Trust.


     3.07 Participation After March 1, 1995. Any Eligible Employee who met the
eligibility requirements under the ESOP and/or the Tax Benefit Plan as it
existed prior to the Effective Date shall continue to be a Participant in the
Plan on the Effective Date. Each person who was a Participant in the Plan on
the day immediately preceding the Merger Effective Date (as defined in Section
2.14 hereof) shall remain a Participant in the Plan after said Date.


     3.08 Participation After July 1, 1998. Notwithstanding anything in the
Plan to the contrary, on and after July 1, 1998, the Participants in this Plan
shall consist solely of those Eligible Employees who have met the requirements
of this Article to be a Participant and who are employed in a bargaining unit
covered by a collective bargaining agreement that provides for participation in
this Plan, and those other persons who were Participants on June 30, 1998, but
who were not Eligible Employees on June 30, 1998. Any person who was both a
Participant and an Eligible Employee on June 30, 1998, but who is not described
in the previous sentence shall not be entitled to any benefit under this Plan
on or after July 1, 1998.


     3.09 Special Rule for Employees of Cabot Corporation or Texas-New Mexico
Power Company. Notwithstanding the provisions of Section 3.01, any Eligible
Employee who was a former employee of Cabot Corporation or Texas-New Mexico
Power Company and who was hired as an Eligible Employee of Southwestern Public
Service Company on or about August, 1995 in connection with and at the time of
Southwestern Public Service’s acquisition of certain assets of Cabot
Corporation and Texas-New Mexico Power Company, shall become a Participant as
of the Entry Date coinciding with or next following the date upon which such
Eligible Employee completes an Eligibility Year of Service computed as if such
Eligible Employee’s Date of Employment was measured from the date such Eligible
Employee last commenced employment with Cabot Corporation or Texas-New Mexico
Power Company, as the case may be, prior to being hired by the Employer.


     3.10 Periods of Military Service. Notwithstanding any provision of this
Plan to the contrary, contributions, benefits and service credit with respect
to qualified military service will be provided in accordance with Code Section
414(u).


ARTICLE IV



CONTRIBUTIONS



     4.01 Company Contributions. As of the last day of each Plan Quarter,
each Employer shall make a contribution (the “Company Contribution”) in cash,
or if appropriate, in shares of Company Stock, to the Trust in such amount as
may be determined by the Committee, to be allocated among the Company
Contribution Accounts of Participants in accordance with Section 5.03 hereof.
In no event, however, shall any Company Contribution for any Plan Quarter by
any Employer be required. In addition, in no event, however, shall any Company
Contribution, when added to any Elective Contributions and Company Matching
Contributions, exceed the


15






 


maximum deductible contribution under Code Section 404(a) including any
amount which may be deductible by the Employer under the carryover provisions
of the Code.


     For purposes of determining and allocating Company Contributions and
Company Matching Contributions under this Article IV and Article V in the case
of Participants whose Accounts were transferred to the New Century Energies,
Inc. Employees’ Savings and Stock Ownership Plan for Non-Bargaining Unit
Employees effective as of July 1, 1998, the Plan Quarter that began on June 1,
1998 was deemed to end on June 30, 1998 and contributions on behalf of such
non-bargaining unit Participants for said period were made and allocated
separately from contributions on behalf of other Participants based on the
Elective Contributions and Compensation of such non-bargaining unit
Participants during said period.


     4.02 Elective Contributions. In addition to any Company Contribution
permitted hereunder, each Employer shall contribute to the Trust Fund an amount
determined under the provisions of this Section, as an Elective Contribution,
on behalf of each Participant who has in effect an agreement electing to reduce
his or her Compensation (“Salary Reduction Agreement”). The rate to be
contributed as an Elective Contribution on behalf of each such Participant, for
each payroll period, as such Participant shall elect, shall be equal to (i)
for Participants who are Non-Highly Compensated Employees (as defined in
Subsection 4.03(8) hereof) from one to fifteen percent (1% – 15%) of such
Participant’s Compensation for the payroll period, and (ii) for Participants
who are Highly Compensated Employees (as defined in Subsection 4.03(8) hereof)
from one to fifteen percent (1% – 15%) of such Participant’s Compensation for
the payroll period, as determined from time to time and set by the Committee
and communicated to such Participants, based in part on the anticipated
Limitations on Elective Contributions under Section 4.03 hereof for such
Participants. The percentage rate of Elective Contributions, if any, which
each Participant elects must be in whole percentage points and shall be made on
a Salary Reduction Agreement provided by and filed with the Committee.


     An election of a rate shall initially be effective as of the date as
specified by the Committee, provided the Salary Reduction Agreement is filed at
the time and in the manner prescribed by the Committee. An election shall not
have retroactive effect and shall remain in force until revoked or changed.
The Committee shall establish and communicate to Participants uniform and
nondiscriminatory procedures for the election of salary reduction amounts,
including procedures regarding the effective dates of any such elections and
for changes in elections and discontinuances of such elections, and may change
said procedures at such times and in such manner as the Committee may determine
to be necessary or desirable.


     Elective Contributions made on behalf of a Participant shall be credited
to his Employee Elective Contribution Account under the Plan. Any amounts
credited to a Participant’s Employee Elective Contribution Account shall, for
all purposes and in all respects, be fully vested and nonforfeitable.


     4.03 Limitations on Elective Contributions. The limitations described in
this Section 4.03 shall be determined in accordance with the applicable
sections of the Code and regulations thereunder.


          4.03(1) Notwithstanding any other provision of this Plan, in no event
shall the Employer make an Elective Contribution in any Plan Year if such
contribution would cause the



16






 





“Actual Deferral Percentage” (or “ADP”) of Highly Compensated Employees to
exceed the greater of the limitations indicated below:


               (a) One hundred twenty-five percent (125%) of the ADP for all Non-Highly
Compensated Employees; or



               (b) The lesser of (A) the sum of the ADP for all Non-Highly Compensated
Employees plus two percent (2%), or (B) two hundred percent (200%) of the ADP
for all Non-Highly Compensated Employees.



          4.03(2) The Committee may, at any time prior to or during a Plan Year, to
the extent necessary to conform the Elective Contributions to the above
limitations or, if applicable, the limitations of Subsection 4.06(8) hereof,
reduce or eliminate prospectively the percentage rates of Elective
Contributions to be made on behalf of Highly Compensated Employees. Such
prospective elimination or reduction shall be applied among the Highly
Compensated Employees who have elected Elective Contributions in such manner as
the Committee, in its sole discretion, shall deem appropriate, taking into
consideration the ability of any Highly Compensated Employee to defer
compensation under any non-qualified plan maintained by an Employer.



          4.03(3) In the event that following the end of a Plan Year, it is
determined by the Committee that the Elective Contributions for Highly
Compensated Employees exceed the limitations of Subsection 4.03(1), then the
amount in excess of such limitation (“Excess Contributions”) (and the income
thereon) shall be distributed to the Highly Compensated Employees,
notwithstanding any Plan provision to the contrary, within two and one-half
(2-1/2) months after the close of the Plan Year in which such Excess
Contributions occurred. In determining the amount of the Excess Contributions,
the following rules shall apply: First, the Elective Contributions of all
those Highly Compensated Employees who have elected the highest percentage rate
of Elective Contributions shall be hypothetically reduced to the percentage
rate elected by all those Highly Compensated Employees (including those
Employees whose percentage rate was previously reduced) whose elected
percentage rate is at the next highest percentage rate of Elective
Contributions and shall thereafter continue to be applied to the extent
necessary in like manner in descending order on the basis of elected percentage
rates until the hypothetical reductions enable the Elective Contributions to
conform to the limitations of Subsection 4.03(1). The sum of the hypothetical
reductions in the previous sentence is the amount of the Excess Contributions.



          The amount of the Excess Contributions that are distributed to each
affected Highly Compensated Employee shall be determined as follows: First, the
Elective Contributions of all those Highly Compensated Employees who have
elected the greatest dollar amount of Elective Contributions shall have their
Elective Contributions reduced to the dollar amount elected by all those Highly
Compensated Employees (including those Employees whose dollar amount of
Elective Contributions was previously reduced) whose elected dollar amount is
at the next greatest amount of Elective Contributions and shall thereafter
continue to be applied to the extent necessary in like manner in descending
order on the basis of dollar amounts of Elective Contributions until the amount
of reductions equal the amount of Excess Contributions.



               The amount of Excess Contributions that may be distributed under this
Subsection with respect to a Highly Compensated Employee for a Plan Year shall
be reduced by



17






 





any Excess Deferrals (as defined in Subsection 4.03(7)) attributable to
such Plan Year previously distributed to such Employee. In the event a
distribution of Elective Contributions constitutes a distribution of Excess
Contributions and a distribution of Excess Deferrals pursuant to Subsection
4.03(7), the amounts distributed shall be treated as a simultaneous
distribution of both Excess Contributions and Excess Deferrals.


          4.03(4) In determining the amount of income allocable to Excess
Contributions which are being distributed, the following rules shall apply:



               (a) The income allocable to Excess Contributions for the Plan Year in
which the contributions are made is the income for the Plan Year allocable to
Elective Contributions and amounts treated as Elective Contributions with
respect to the Highly Compensated Employee, multiplied by a fraction, the
numerator of which is the amount of Excess Contributions made on behalf of the
Highly Compensated Employee for the Plan Year and the denominator of which is
the balance of such Employee’s Employee Elective Contribution Account as of the
end of the Plan Year before adjustment of such Account as provided for in
Subsection 6.04(3).



               (b) No income shall be allocable to the Excess Contributions for the
period between the end of the Plan Year and the date of the distribution.



               (c) For purposes of this Subsection, the income of the Plan shall mean all
earnings, gains and losses, computed in accordance with the provisions of
Article VI.



          4.03(5) Effective for Plan Years beginning on or after January 1, 1997,
this subsection (5) ceases to apply. For Plan Years beginning before January
1, 1997, notwithstanding anything to the contrary contained herein, in the case
of a Highly Compensated Employee who is, pursuant to the requirements of Code
Section 414(q)(6), to be treated as part of an Aggregated Family Group, as
defined in Subsection 4.03(8)(f), the following rules shall apply:



               (a) The ADP for the Aggregated Family Group shall be determined by
aggregating the Elective Contributions and Total Compensation of all Family
Members, as defined in Subsection 4.03(8)(f), who are Employee Participants.



               (b) If the limitations of Subsection 4.03(1) are exceeded, the ADP of the
Aggregated Family Group shall be reduced as provided in Subsection 4.03(2) or
(3) in order to comply with the limitations of Subsection 4.03(1), and if the
provisions of Subsection 4.03(3) are applicable, Excess Contributions shall be
allocated among and distributed to all of the Family Members in proportion to
each such Family Member’s Elective Contributions.



          4.03(6) In addition to or in lieu of the above procedures to conform
Elective Contributions to the limitations of Subsection 4.03(1), the Employer
may, in its sole discretion, contribute on behalf of any Participant who is a
Non-Highly Compensated Employee additional contributions (which shall meet the
requirements of Treasury Regulation Section 1.401(k)-1(b)(5) (or any successor
thereto), shall be treated as Elective Contributions and shall be allocated to
such Participant’s Employee Elective Contribution Account) to the extent
necessary to insure that the limitations of Subsection 4.03(1) are met. Any
such additional



18






 





contributions shall be allocated in a manner proportionate to the Total
Compensation of the affected Participants. Such additional contributions shall
be immediately fully vested and subject to the distribution restrictions of
Sections 4.08 and 11.04 hereof, applicable to Elective Contributions. In
addition, the Committee may designate that all or part of the Company
Contributions or Company Matching Contributions, or both, allocated to a
Participant’s Accounts shall be included in the calculations under Subsection
4.03(1) to the extent necessary to insure that the limitations of Subsection
4.03(1) are met, provided such use complies with the requirements of Treasury
Regulation Section 1.401(k)-1(b)(5) (or any successor thereto). Any Company
Contributions or Company Matching Contributions, or both, so designated shall
not be included in the calculations under Subsection 4.06(1), shall be treated
as Elective Contributions, shall be allocated to such Participant’s Employee
Elective Contribution Account, shall be immediately fully vested and, to the
extent applicable, shall be subject to the distribution restrictions of
Sections 4.08 and 11.04 hereof applicable to Elective Contributions.


          4.03(7) Notwithstanding anything herein to the contrary, in no event
shall the Employer make an Elective Contribution in any Plan Year on behalf of
any Participant if such contribution would cause the Elective Contributions for
such Participant for the Participant’s taxable year to exceed Eleven Thousand
Dollars ($11,000), or such higher amount as provided in Code Section 402(g) or
such higher amount to which such amount has been adjusted by the Secretary of
the Treasury or his delegate at the same time and in the same manner as under
Code Section 415(d), as of the beginning of such taxable year. Should any
Elective Contribution made to the Plan by the Employer on behalf of a
Participant exceed Eleven Thousand Dollars ($11,000), as so adjusted (“Excess
Deferrals”) on account of the Participant’s Elective Contributions to another
plan, contract or arrangement, the Participant may, not later than March 15
following the close of his taxable year, notify the Committee in writing of the
amount of the Excess Deferral and the Committee thereafter shall cause such
Excess Deferral (and income allocable thereto) to be distributed to such
Participant, notwithstanding any Plan provision to the contrary, no later than
the April 15 next following the close of the Participant’s taxable year in
which such Excess Deferral is made. In the event the Participant’s Elective
Contributions to the Plan and other plans, contracts or arrangements of an
Employer or an Affiliated Company constitute Excess Deferrals, such Participant
shall be deemed to have timely notified the Committee of the amount of such
Excess Deferral as provided for in the preceding sentence and the appropriate
Employers or Affiliated Companies shall notify the Committee on behalf of the
Participant under these circumstances. The amount of Excess Deferrals which
may be distributed to the Participant shall not exceed the Participant’s
Elective Contributions under the Plan during the Participant’s taxable year.



               In determining the amount of income allocable to Excess Deferrals, the
following rules shall apply:



               (a) The income allocable to Excess Deferrals for the taxable year in which
the deferrals are made is the income for the Plan Year ending with or within
said taxable year allocable to Elective Contributions for the Participant
multiplied by a fraction, the numerator of which is the amount of Excess
Deferrals made on behalf of the Participant for the Plan Year ending with or
within said taxable year and the denominator of which is the balance of the
Participant’s Employee Elective Contribution Account as of the end of the Plan
Year ending



19






 





with or within said taxable year before adjustment of such Account as
provided for in Subsection 6.04(3).


               (b) No income shall be allocable to the Excess Deferrals for the period
between the end of the Plan Year and the date of the distribution.



               (c) For purposes of this Subsection, the income of the Plan shall mean all
earnings, gains and losses computed in accordance with the provisions of
Article VI.



          The amount of Excess Deferrals that may be distributed under this
Subsection with respect to a Highly Compensated Employee for any taxable year
of said Employee shall be reduced by any Excess Contributions previously
distributed to the Employee attributable to such taxable year. In the event a
distribution of Elective Contributions constitutes a distribution of Excess
Contributions pursuant to Subsection 4.03(3) and a distribution of Excess
Deferrals pursuant to this Subsection, the amounts distributed shall be treated
as a simultaneous distribution of both Excess Contributions and Excess
Deferrals.



          4.03(8) For purposes of this Section 4.03, the following terms shall have
the following meanings:



               (a) “Actual Deferral Percentage” (or “ADP”) shall mean for the Highly
Compensated Employees, as a group, and for the Non-Highly Compensated
Employees, as a group, the average of the ratios (calculated separately for
each such Employee Participant in such group) of the Elective Contributions, if
any, made on behalf of each such Employee Participant for each Plan Year, to
the Employee Participant’s Total Compensation, as defined in Subsection
4.03(8)(e), for such Plan Year. For purposes of computing ADP, an Employee
Participant who makes no Elective Contributions for a Plan Year shall be
treated as making a zero percent contribution for the Plan Year.



               In calculating ADP, an Elective Contribution shall be taken into account
for a Plan Year only if such Elective Contribution: (i) relates to Total
Compensation that would have been received by the Employee Participant during
such Plan Year (but for the salary reduction election) or is attributable to
services performed by the Employee Participant during such Plan Year and would
have been received by the Employee Participant within two and one-half (2-1/2)
months after the close of such Plan Year (but for the salary reduction
agreement); and (ii) is allocated to the Employee Participant during such Plan
Year. An Elective Contribution is treated as allocated as of a particular date
during a Plan Year if allocation of such contribution is not contingent on
participation in the Plan or the performance of services after such date and
such contribution is paid to the Trust not later than twelve (12) months after
the close of such Plan Year.



               In calculating the ADP of a Highly Compensated Employee who participates
in more than one plan maintained by an Employer or an Affiliated Company, all
elective deferrals (as defined in Code Section 401(m)(4)) of such Highly
Compensated Employee shall be aggregated for purposes of determining such
percentage.



20






 





               In calculating the ADP of a Highly Compensated Employee who has Excess
Deferrals, such Excess Deferrals shall be treated as Elective Contributions for
purposes of determining such percentage.



               In calculating ADP, all elective deferrals (as defined in Code Section
401(m)(4)) to any plan required to be aggregated with the Plan for purposes of
Code Section 401(a)(4) or 410(b) shall be treated as if made under the Plan.
If the Plan is permissively aggregated with another plan in order to comply
with the limitations of Subsection 4.03(1), such aggregated plans must also
meet the requirements of Code Sections 401(a)(4) and 410(b) as a single plan.



               (b) “Highly Compensated Employee” shall mean, effective for Plan Years
commencing on or after January 1, 1997, any employee of an Employer or
Affiliated Company who is a highly compensated employee as defined in Code
Section 414(q) and the regulations thereunder. Generally, any such employee is
considered a Highly Compensated Employee if such employee:



                    (i) was at any time during the current Plan Year or the prior Plan Year, a
“five percent owner”, as defined in Code Section 416(i)(1), with respect to an
Employer;



                    (ii) received Limitation Year Compensation from the Employer in excess of
Eighty Thousand Dollars ($80,000) during the prior Plan Year in the case of
determinations for Plan Years commencing prior to 2001, or in excess of Eighty
Five Thousand Dollars ($85,000) during the prior Plan Year in the case of
determinations for Plan Years commencing in 2001 or 2002, or in excess of
$90,000 for the prior Plan Year in the case of determinations for Plan Years
commencing in 2003 or later. The dollar amount in this paragraph (ii) shall be
adjusted to reflect increases in the cost-of-living published by the Secretary
of Treasury pursuant to Code Section 414(q)(1). For any Plan Year, the
applicable dollar amount shall be the dollar amount in effect for the calendar
year in which the Plan Year commences.



                    For purposes of this Section 4.03, “Limitation Year Compensation” shall
have the same meaning as set forth in Subsection 5.07(5) hereof, subject to the
following: (i) the determination of “Limitation Year Compensation” shall
include amounts deferred pursuant to Code Sections 125, 401(k), 408(k)(6),
403(b) and, for Limitation Years commencing on or after January 1, 2000, Code
Section 132(f)(4) and (ii) Limitation Year Compensation shall include
compensation paid by any employer required to be aggregated with an Employer
under Code Section 414(b), (c), (m) or (o).



                    A Former Employee who is an Employee Participant shall be treated as a
Highly Compensated Employee if such Former Employee was a Highly Compensated
Employee when he separated from service with the Employer or was a Highly
Compensated Employee at any time after attaining age fifty-five (55). “Former
Employee” shall mean a person who has been an employee, but who ceased to be an
employee for any reason and later returned to employment with an Employer.



                    For Plan Years commencing before January 1, 1997, “Highly Compensated
Employee” also included any employees who were, pursuant to the requirements




21






 





of Code Section 414(q)(6), to be treated as part of an Aggregated Family
Group, as defined in Subsection 4.03(8)(f) hereof.


               (c) “Non-Highly Compensated Employee” shall mean each Employee Participant
who is not a Highly Compensated Employee.



               (d) “Employee Participant” shall mean each Eligible Employee who is a
Participant.



               (e) “Total Compensation” shall mean an Employee Participant’s total
compensation for services rendered to an Employer during the Plan Year, as
reported in Box 10 on Form W-2 or other similar location on any successor
federal wage statement as taxable for federal income tax purposes but
determined without regard to any rules that limit the amount taken into account
based on the nature or location of the employment or the services performed
(such as the exception for agricultural labor in Code Section 3401(a)(2)).
Total Compensation shall not include amounts paid or reimbursed by an Employer
or Affiliated Company for moving expenses incurred by an Employee Participant,
but only to the extent that at the time of the payment it is reasonable to
believe that these amounts are deductible by the Employee Participant under
Code Section 217.



     In the event an employee begins, resumes or ceases to be an Employee
Participant during a Plan Year, the amount of such Employee Participant’s Total
Compensation for the entire Plan Year that shall be taken into account for
purposes of Section 4.03 shall not include that portion of the Employee’s Total
Compensation paid for any period prior to the Entry Date on which an Employee
first becomes a Participant or the date on which a Participant resumes active
participation hereunder or after the date that a Participant ceases to be an
active Participant hereunder.


     Total Compensation shall be limited to One Hundred Fifty Thousand Dollars
($150,000) for Plan Years commencing on or after January 1, 1994 and before
January 1, 1997; One Hundred Sixty Thousand Dollars ($160,000) for Plan Years
commencing on or after January 1, 1997 and before January 1, 2000; and One
Hundred Seventy Thousand Dollars ($170,000) for Plan Years commencing on or
after January 1, 2000.


     In applying the compensation limitation for Plan Years commencing prior to
January 1, 1997, the family group of a Highly Compensated Employee who is
subject to the family member aggregation rules of Code Section 414(q)(6)
because such Employee is either a five percent owner of the Employer or one of
the ten (10) Highly Compensated Employees paid the greatest Limitation Year
Compensation ( during the year, shall be treated as a single Participant. For
this purpose, “Family Members” shall include any spouse, lineal ascendant,
lineal descendant, spouse of a lineal ascendant, or spouse of a lineal
descendant of the Highly Compensated Employee. In the event the Highly
Compensated Participant’s and one or more Family Member’s Total Compensation
for a Plan Year from an Employer are limited pursuant to the provisions of this
Section, then the Total Compensation of each such person for such Plan Year
shall be reduced proportionately based on the ratio of their respective Total
Compensation to the aggregate Total Compensation of both (or all) of such
persons for such Plan Year.


22






 


     Notwithstanding the foregoing, Total Compensation may be modified as
follows:


     If elected by the Committee in accordance with Treasury Regulations, Total
Compensation shall include any amount that is not currently includable in the
Employee Participant’s gross income by reason of an elective salary deferral
pursuant to an Employer’s cafeteria plan established pursuant to Code Section
125 or any other Employer plan established pursuant to Code Section 401(k),
including this Plan.


     If elected by the Committee in accordance with Treasury Regulations, Total
Compensation shall not include reimbursements or other expense allowances,
fringe benefits (cash and non-cash), moving expenses, deferred compensation and
welfare benefits, even if includable in gross income; provided, however, that
if the Committee elects to exclude such amounts, a Self-Employed Individual’s
total Earned Income for the Plan Year shall be multiplied by a fraction, the
numerator of which is the Total Compensation of all Non-Highly Compensated
Employees (who are not Self-Employed Individuals) excluding the foregoing
exclusions, and the denominator of which is the Total Compensation of all
Non-Highly Compensated Employees (who are not Self-Employed Individuals)
including the foregoing exclusions.


               (f) “Aggregated Family Group” shall mean a family group of employees
employed by an Employer required to be aggregated under Code Section 414(q)(6)
and regulations thereunder and shall include any member of the family, as
defined in Code Section 414(q)(6) and regulations thereunder, of either (i) a
five percent (5%) owner, or (ii) one of the ten (10) Highly Compensated
Employees paid the greatest Limitation Year Compensation for the current Plan
Year. Any spouse, lineal ascendant, lineal descendant, spouse of a lineal
ascendant, or spouse of a lineal descendant of such a Highly Compensated
Employee (a “Family Member”) shall be included in the “Aggregated Family
Group.”



     4.04 Company Matching Contributions. As of the last day of each Plan
Quarter, each Employer shall make a contribution (the “Company Matching
Contribution”) in cash or, if appropriate, in shares of Company Stock, to the
Trust in such amount as may be determined by the Committee, to be allocated
among the Company Matching Contribution Accounts of Participants in accordance
with Section 5.01 hereof. In no event, however, shall any Company Matching
Contribution for any Plan Quarter by any Employer be required. In addition, in
no event, however, shall any Company Matching Contributions, when added to any
Company Contributions and Elective Contributions, exceed the maximum deductible
contribution under Code Section 404(a) including any amount which may be
deductible by the Employer under the carryover provisions of the Code.


     4.05 Date of Payment and Allocation of Company Contributions, Company
Matching Contributions and Elective Contributions. An Employer shall make its
Company Contributions and Company Matching Contributions to the Trust Fund for
a Plan Quarter as soon as administratively possible on or after the last day of
such Plan Quarter. Company Contributions and Company Matching Contributions
shall be deemed to have been made and shall be allocated to the Company
Matching Contribution Accounts and Company Contribution Accounts of Eligible
Participants in accordance with Sections 5.01 and 5.03 hereof as of the last
day of the Plan Quarter for which they are made. An Employer shall make all
Elective Contributions as provided for in Section 4.02 hereof to the Trust Fund
as soon as such amounts reasonably can be


23






 


segregated from the general assets of the Employer but in all events by
the fifteenth (15th) day of the calendar month following the close of the
payroll period in which such amounts would otherwise have been payable to the
Participant in cash. Elective Contributions shall be deemed to have been made
and shall be allocated to the Employee Elective Contribution Accounts of the
Participants for whom they are made in accordance with Section 4.02 as of the
last day of the Plan Quarter for which they are made.


     4.06 Limitation on Company Matching Contributions. This section 4.06
shall only apply for Plan Years in which non-collectively bargained employees
benefit under the Plan. The limitations described in this Section shall be
determined in accordance with the applicable Sections of the Code and
regulations thereunder.


          4.06(1) Notwithstanding any other provision of this Plan, the “Actual
Contribution Percentage” (or “ACP”) of Company Matching Contributions made to
this Plan for Highly Compensated Employees during any Plan Year shall not
exceed the greater of the limitations indicated below:



               (a) One hundred twenty-five percent (125%) of the ACP for all Non-Highly
Compensated Employees; or



               (b) The lesser of (A) the sum of the ACP for all Non-Highly Compensated
Employees plus two percent (2%), or (B) two hundred percent (200%) of the ACP
for all Non-Highly Compensated Employees.



          4.06(2) The Committee may, at any time prior to or during a Plan Year, to
the extent necessary to conform the Company Matching Contributions to the above
limitations or, if applicable, the limitations of Subsection 4.06(8) hereof,
reduce or eliminate prospectively the allocation of Company Matching
Contributions for the benefit of Highly Compensated Employees. Such
prospective elimination or reduction shall be applied among the Highly
Compensated Employees who have elected Elective Contributions in such manner as
the Committee, in its sole discretion, shall deem appropriate, taking into
consideration the ability of any Highly-Compensated Employee to defer
compensation under any non-qualified plan maintained by an Employer.



          4.06(3) In the event that following the end of the Plan Year, it is
determined by the Committee that the Company Matching Contributions for Highly
Compensated Employees exceed the limitations of Subsection 4.06(1), then the
amount in excess of such limitation (“Excess Aggregate Contributions”) (and
income thereon) either shall be distributed to the Highly Compensated
Employees, notwithstanding any Plan provision to the contrary, within two and
one-half (2-1/2) months after the close of the Plan Year in which such Excess
Aggregate Contributions occurred, or forfeited in accordance with the following
rules: First, the Company Matching Contributions of all those Highly
Compensated Employees who have elected the highest percentage rate of Matching
Contributions shall be hypothetically reduced to the percentage rate elected by
all those Highly Compensated Employees (including those Employees whose
percentage rate was previously reduced) whose elected percentage rate is at the
next highest percentage rate of Company Matching Contributions and shall
thereafter continue to be applied to the extent necessary in like manner in
descending order on the basis of elected percentage rates until the
hypothetical reductions enable the Company Matching Contributions to



24






 





conform to the limitations of Subsection 4.06(1). The sum of the
hypothetical reductions in the previous sentence is the amount of the Excess
Aggregate Contributions.


          The amount of the Excess Aggregate Contributions that are either
distributed to each affected Highly Compensated Employee or forfeited shall be
determined as follows: First, the Company Matching Contributions of all those
Highly Compensated Employees who have elected the greatest dollar amount of
Company Matching Contributions shall have their Elective Contributions reduced
to the dollar amount elected by all those Highly Compensated Employees
(including those Employees whose dollar amount of Company Matching
Contributions was previously reduced) whose elected dollar amount is at the
next greatest amount of Company Matching Contributions and shall thereafter
continue to be applied to the extent necessary in like manner in descending
order on the basis of dollar amounts of Company Matching Contributions until
the amount of reductions equal the amount of Excess Aggregate Contributions.



          In applying the reduction, distribution and forfeiture rules of this
Subsection 4.06(3), a Highly Compensated Employee’s Excess Aggregate
Contributions shall be distributed, if vested, or forfeited, if nonvested, in
proportion to the Participant’s vested and nonvested interests in all Company
Matching Contributions. For purposes of the foregoing sentence, the Employee’s
Excess Aggregate Contributions attributable to the vested portion of the Highly
Compensated Employee’s Company Matching Contributions for any Plan Year shall
be the product of (i) the amount of the Employee’s Excess Aggregate
Contributions (as adjusted for allocable income) multiplied by (ii) his vested
percentage, determined as of the last day of said Plan Year. The amount of
Excess Aggregate Contributions to be distributed to each affected Highly
Compensated Employee or forfeited, as appropriate, is equal to the Company
Matching Contributions on behalf of such Employee (prior to reduction of the
Excess Aggregate Contributions), less the product of such Employee’s ACP (after
reduction for such Excess Aggregate Contributions) times such Participant’s
Total Compensation, rounded to the nearest one cent ($.01), and likewise is
equal to the amount of reduction provided for hereinabove.



          4.06(4) In determining the amount of income allocable to Excess Aggregate
Contributions which are being distributed or forfeited, the following rules
shall apply.



               (a) The income allocable to Excess Aggregate Contributions for the Plan
Year in which the contributions are made is the income for the Plan Year
allocable to Company Matching Contributions with respect to the Highly
Compensated Employee multiplied by a fraction, the numerator of which is the
amount of Excess Aggregate Contributions made on behalf of the Highly
Compensated Employee for the Plan Year and the denominator of which is the
combined balance of the Participant’s Company Matching Contributions Account as
of the end of the Plan Year before adjustment of such Account as provided for
in Subsection 6.04(3) hereof.



               (b) No income shall be allocable to the Excess Aggregate Contributions for
the period between the end of the Plan Year and the date of the distribution.



               (c) For purposes of this Subsection, the income of the Plan shall mean all
earnings, gains and losses computed in accordance with the provisions of
Article VI.




25






 





          4.06(5) Effective for Plan Years beginning on or after January 1, 1997,
this subsection (5) ceases to apply. For Plan Years beginning before January
1, 1997, notwithstanding anything to the contrary contained herein, in the case
of a Highly Compensated Employee who is, pursuant to the requirements of Code
Section 414(q)(6), to be treated as part of an Aggregated Family Group, the
following rules shall apply:



               (a) The ACP for the Aggregated Family Group shall be determined by
aggregating the Company Matching Contributions and Total Compensation of all
Family Members who are Employee Participants.



               (b) If the limitations of Subsection 4.06(1) are exceeded, the ACP of the
Aggregated Family Group shall be reduced as provided in Subsection 4.06(3) in
order to comply with the limitations of Subsection 4.06(1), and if the
provisions of Subsection 4.06(3) are applicable, Excess Aggregate Contributions
shall be allocated among and forfeited or distributed to all of the Family
Members in proportion to each such Family Member’s Company Matching
Contributions.



          4.06(6) In addition to or in lieu of the above procedures to conform
Company Matching Contributions to the limitations of Subsection 4.06(1), the
Employer may, in its sole discretion, contribute on behalf of any Participant
who is a Non-Highly Compensated Employee additional contributions (which shall
meet the ( requirements of Treasury Regulation Section 1.401(m)-1(b)(5) (or any
successor thereto), shall be treated as Elective Contributions and shall be
allocated to such Participant’s Employee Elective Contribution Account) to the
extent necessary to insure that the limitations of Subsection 4.06(1) are met.
Any such additional contributions shall be allocated in a manner proportionate
to the Total Compensation of the affected Participants. Such additional
contributions shall be immediately fully vested and subject to the distribution
restrictions of Section 4.08 and 11.04 hereof, applicable to Elective
Contributions. In addition, the Committee may designate that all or part of
the Elective Contributions or Company Contributions, or both, allocated to a
Participant’s Accounts shall be included in the calculations under Subsection
4.06(1) to the extent necessary to insure that the limitations of Subsection
4.06(1) are met, provided such use complies with the requirements of Treasury
Regulation Section 1.401(m)-1(b)(5) (or any successor thereto). Any Elective
Contributions or Company Contributions so designated shall not be included in
the calculations under Subsection 4.03(1), shall be treated as Elective
Contributions, shall be allocated to such Participant’s Employee Elective
Contribution Account, shall be immediately fully vested and, to the extent
applicable, shall be subject to the distribution restrictions of Sections 4.08
and 11.04 hereof applicable to Elective Contributions.



          4.06(7) For purposes of this Section 4.06, the following terms shall have
the following meanings:



               (a) “Actual Contribution Percentage” (or “ACP”) shall mean for the Highly
Compensated Employees, as a group, and for the Non-Highly Compensated
Employees, as a group, the average of the ratios (calculated separately for
each Employee Participant in such group) of the amount of Company Matching
Contributions paid to the Trust on behalf of each such Employee Participant for
each Plan Year to the Employee Participant’s Total Compensation for such Plan
Year. For purposes of computing ACP, an Employee Participant who makes no



26






 





Elective Contributions for a Plan Year and who receives no Company
Matching Contributions for a Plan Year shall be treated as having an ACP of
zero for the Plan Year.


               In calculating ACP, a Company Matching Contribution shall be taken into
account for a Plan Year only if such Company Matching Contribution: (i) is
made on account of the Employee Participant’s Elective Contributions for the
Plan Year, (ii) is allocated to the Employee Participant during such Plan Year,
and (iii) is paid to the Trust not later than the last day of the twelfth
(12th) month following the close of such Plan Year.



               In calculating ACP, all employee contributions and employer matching
contributions (as defined in Code Section 401(m)(4)) of any Highly Compensated
Employee who participates in more than one plan maintained by an Employer or an
Affiliated Company shall be aggregated for purposes of determining such
percentage.



               In calculating ACP, all employee contributions and employer matching
contributions (as defined in Code Section 401(m)(4)) to any plan required to be
aggregated with the Plan for purposes of Code Section 401(a)(4) or 410(b) shall
be treated as if made under the Plan. If the Plan is permissively aggregated
with another plan in order to comply with the limitations of Subsection
4.06(1), such aggregated plans must also meet the requirements of Code Sections
401(a)(4) and 410(b) as a single plan.



               (b) “Highly Compensated Employee,” “Employee Participant,” “Non-Highly
Compensated Employee,” “Total Compensation,” “Aggregated Family Group,” and
“Family Member” shall all have the meanings set forth in Subsection 4.03(8).



               (c) “Aggregate Limit” shall mean the greater of:



                    (a) the sum of (i) 125% of the greater of the ADP of the Non-Highly
Compensated Employees (as a group) for the Plan Year or the ACP of the
Non-Highly Compensated Employees (as a group) for the Plan Year and (ii) two
percentage points plus the lesser of such ADP or ACP; or



                    (b) the sum of (i) 125% of the lesser of the ADP of the Non-Highly
Compensated Employees for the Plan Year or the ACP of the Non-Highly
Compensated Employees for the Plan Year and (ii) two percentage points plus the
greater of such ADP or ACP.



          4.06(8) If one or more Highly Compensated Employees participates in this
Plan and the sum of the ADP and ACP of those Highly Compensated Employees
exceeds the Aggregate limit, then the ACP of those Highly Compensated Employees
will be reduced in accordance with Subsection 4.06(3) so that the Aggregate
Limit is not exceeded. The amount by which each Highly Compensated Employee’s
Company Matching Contributions are reduced shall be treated as an Excess
Aggregate Contribution. The ADP and ACP of the Highly Compensated Employees
are determined after any corrections required to meet the ADP and ACP tests or
to correct Excess Deferrals under Subsection 4.03(7) hereof. No reduction will
be required under this Subsection if both the ADP and ACP of the Highly
Compensated Employees does not exceed 1.25 multiplied by the ADP and ACP of the
Non-Highly Compensated Employees. Effective for Plan Years commencing on or
after January 1, 2002, this subsection (8) ceases to apply.




27






 





     4.07 Rollovers.


          4.07(1) With the consent of the Committee, “Rollover Contributions” in
cash or such other form as may be permitted by the Committee may be received by
the Trustee on behalf of any Eligible Employee or Participant. Such amounts
shall be allocated and credited to a separate Account herein referred to as a
“Rollover Account” as of the date on which such amounts were received by the
Trustee. However, the transfer of such an amount to the Trustee will not cause
such Eligible Employee to be eligible to participate in the Plan prior to the
time specified in Section 3.01. Prior to the time such Eligible Employee
becomes eligible to participate in the Plan, the Eligible Employee shall be
treated as a Participant solely with respect to the amount in his Rollover
Account.



          4.07(2) An amount credited to a Rollover Account (iii) shall be held by
the Trustee pursuant to the provisions of this Plan, (ii) shall be fully vested
at all times and shall not be subject to forfeiture for any reason, and (iii)
shall be distributed to the Eligible Employee, Participant or Beneficiary at
such time and in the same manner as provided in this Article IV or Article XI
hereof for the distribution of a Participant’s Accounts under the Plan.



          4.07(3) During the Plan Quarter in which the Rollover Contribution is
initially received by the Plan, all of the balance of the Eligible Employee’s
or Participant’s Rollover Account shall be segregated for investment purposes
and any earnings thereon shall inure to the benefit of the Eligible Employee or
Participant. Such segregated amounts may be temporarily held in cash, and as
soon as practical, shall be invested as directed by the Participant or Eligible
Employee in accordance with the provisions of Section 14.02 hereof.



          4.07(4) For purposes of this Section, the term “Rollover Contributions”
shall include:



               (a) Amounts which are properly characterized as a qualifying rollover
distribution (including a lump sum distribution) received by a person who is
now an Eligible Employee or a Participant from another qualified plan, which
amounts are eligible for tax free rollover treatment and which are transferred
by the Eligible Employee or Participant to the Trustee of this Plan within
sixty (60) days following receipt thereof;



               (b) Amounts transferred to this Plan from an individual retirement account
as defined in Code Section 7701(a)(37), provided that the individual retirement
account contains no assets other than (1) assets which were previously
distributed to the person who is now an Eligible Employee or a Participant by
another qualified corporate (and, after December 31, 1983, qualified
non-corporate) employer’s plan as a qualifying rollover distribution (including
a lump sum distribution) with respect to such person’s service for such
employer, which amounts were eligible for tax-free rollover treatment, and
which amounts were deposited in such individual retirement account within sixty
(60) days of receipt thereof, and (2) earnings on said assets; and



               (c) Amounts distributed to a person who is now an Eligible Employee or a
Participant from an individual retirement account meeting the requirements of
Subsection 4.07(4)(b) above, and transferred by the Eligible Employee or
Participant to this Plan within sixty (60) days of receipt thereof from such
individual retirement account.




28






 





Prior to accepting any transfers to which this Section 4.07 applies, the
Committee may require the Eligible Employee or Participant to establish that
the amounts to be transferred to this Plan meet the requirements of this
Section and may also require that the Eligible Employee or Participant provide
an opinion of counsel satisfactory to the Committee that the amounts to be
transferred meet the requirements of this Section and will not jeopardize the
tax exempt status of this Plan or the Trust Fund for any reason (including, but
not limited to, the failure of the amount to be excluded from the definition of
annual addition in Code Section 415(c)(2), thereby causing the annual addition
to the Account to exceed the permissible limits of Code Section 415, or to
create adverse tax consequences to an Employer).


     4.08 In-Service Withdrawals.


          4.08(1) Hardship Withdrawals of Elective and Company Matching
Contributions. Subject to the provisions of Subsection 4.08(2), upon
application by a Participant, the Committee may, in accordance with the
provisions of this Subsection, permit such Participant to withdraw all or a
portion of such Participant’s Elective Contributions, but no earnings on such
Contributions, or Company Matching Contributions (including Company
Contributions made under the Tax Benefit Plan), including earnings on such
Contributions, or both, if the Committee determines that the Participant
suffered a Hardship. For purposes hereof, “Hardship” shall mean an immediate
and heavy financial need of the Participant on account of (i) medical expenses
described in Code Section 213(d) previously incurred by the Participant, the
Participant’s spouse or dependents (as defined in Code Section 152) or
necessary for these persons to obtain medical care as described in Code Section
213(d), (ii) purchase (excluding mortgage payments) of a principal residence of
the Participant, (iii) payment of tuition, related educational fees and room
and board expenses for the next twelve (12) months of post-secondary education
for the Participant or such Participant’s spouse, children or dependents (as
defined in Code Section 152), or (iv) the need to prevent eviction of the
Participant from his principal residence or foreclosure on the mortgage of the
Participant’s principal residence. Notwithstanding the foregoing, in no event
shall a Hardship withdrawal of any amount allocated to a Participant’s Account
pursuant to Subsection 4.03(6) or 4.06(6) be permitted.



               The following provisions shall apply with respect to Hardship withdrawals:



               (a) Application for withdrawal must be made in writing on a form approved
by the Committee, and must set out in detail the circumstances establishing
that the proposed withdrawal is for a Hardship.



               (b) The Committee’s determination of whether the application meets the
requirements of this Section shall be final and conclusive, and in making such
determination, the Committee shall follow uniform and nondiscriminatory rules.



               (c) If the Committee is satisfied that the application meets the
requirements of this section and the Code and regulations thereunder, the
application shall be granted.



               (d) A withdrawal shall not be permitted unless the Committee determines
the Participant has obtained all distributions (other than hardship
distributions) and




29






 





all nontaxable loans (determined at the time of the loan) currently
available under all plans maintained by the Employer or any Affiliated Company,
and in no event will such payment exceed the amount required to meet such
financial need plus an amounts necessary to pay any federal, state or local
taxes or penalties reasonably anticipated to result from such payment.


               (e) Any withdrawal taken on or after January 1, 2002 shall terminate the
Participant’s right to make Elective Contributions and employee contributions
to this Plan or “Any Other Plans Maintained by the Employer” until the first
day of the first payroll period of the Plan Quarter which commences at least
six (6) months following such withdrawal. For purposes hereof, “Any Other
Plans Maintained by the Employer” shall mean all qualified and nonqualified
plans of deferred compensation maintained by the Employer, including a stock
option, stock purchase, or similar plan, or a cash or deferred arrangement that
is part of a cafeteria plan within the meaning of Code Section 125. However,
it does not include the mandatory employee contribution portion of a defined
benefit plan. It also does not include a health or welfare benefit plan,
including one that is part of a cafeteria plan within the meaning of Code
Section 125.



          4.08(2) Procedure for Withdrawals. All withdrawals under Subsection
4.08(1) shall be subject to Committee approval. All withdrawals under this
Section 4.08 shall require a written request for withdrawal on such forms as
the Committee shall prescribe. If any withdrawal under this Section 4.08 is
less than the entire amount which is available for withdrawal at such time from
the Employee Elective Contribution and Company Matching Contribution Accounts,
then such Participant must withdraw a minimum amount equal to Five Hundred
Dollars ($500.00). Any withdrawal shall be made from a Participant’s Accounts
in the following order of priority, provided at the time of such withdrawal
such Participant either (i) has an amount credited to such Account, or (ii) is
entitled to withdraw from such Account: Such Participant’s Company Matching
Contribution Account and such Participant’s Employee Elective Contribution
Account. When an application for withdrawal is granted under the provisions of
this Subsection, the Committee shall give such directions to the Trustee as
shall be appropriate to effectuate the distribution in accordance with the
terms hereof of the amount withdrawn. The date of withdrawal payment shall be
specified by the Committee. Withdrawals shall be paid in the form of a single
lump sum. A Participant’s Account shall, for purposes of determining its
current value at the time of withdrawal, be based on the value as of the
Valuation Date preceding the effective date of the withdrawal. For purposes of
allocating appreciation or depreciation of the Trust Fund and income of the
Trust Fund, where appropriate, any withdrawal pursuant to this Article IV shall
be subtracted from the Participant’s Account balance at the beginning of the
Valuation Period in which the withdrawal occurs.



          4.08(3) Spousal Consent to Withdrawals. Notwithstanding anything to the
contrary contained in this Section 4.08, if, at the time a withdrawal is to be
paid to a married Participant, the value of his or her Accounts (including
amounts in his Accounts that are not being withdrawn) is equal to or exceeds
$3,500 for withdrawals prior to January 1, 1998 or $5,000 for withdrawals on or
after January 1, 1998, the Participant’s spouse must, within the 90-day period
before withdrawal amounts are to be paid, consent to the payment of the
withdrawal amount. The spouse’s consent to any such withdrawal (i) must be in
writing, (ii) must consent to the lump sum form of payment, (iii) must
acknowledge the effect of the consent and be witnessed by a Plan representative
or notary public, and (iv) shall be irrevocable.




30






 





ARTICLE V



ALLOCATION TO PARTICIPANTS’ ACCOUNTS



     5.01 Method of Allocating Company Matching Contributions.


          5.01(1) Subject to Sections 4.06, 5.04, 5.05 and 5.06 hereof, the Company
Matching Contribution made for each Plan Quarter shall be allocated as of the
last day of such Plan Quarter among the Company Matching Contribution Accounts
of all Participants who were Eligible Employees for all or any part of such
Plan Quarter and who elected to have made on their behalf Elective
Contributions during such Plan Quarter. Each Participant’s allocable share of
Company Matching Contributions shall be in the proportion that the Elective
Contributions made on his behalf for such Plan Quarter that were not otherwise
distributed or withdrawn pursuant to the provisions of Section 4.03 or 4.08
hereof bears to the total Elective Contributions made on behalf of all
Participants for such Plan Quarter that were not otherwise distributed or
withdrawn pursuant to the provisions of Section 4.03 or 4.08 hereof.
Notwithstanding the foregoing, if Company Matching Contributions have been
allocated to a Participant’s Company Matching Contribution Account and it is
later determined that such Company Matching Contributions are attributable to
Excess Contributions or Excess Deferrals, such Company Matching Contributions
shall be forfeited and such Forfeitures shall be allocated as provided in
Section 5.03 hereof.



          5.01(2) Any amounts of Company Matching Contributions credited to a
Participant’s Company Matching Contribution Account shall, for all purposes and
in all respects, be fully vested and nonforfeitable.



          5.01(3) If, during a Plan Quarter, a Participant is transferred from one
Employer to another Employer, such Participant’s share of each Employer’s
Company Matching Contributions shall be determined on the basis of the Elective
Contributions made on behalf of such Participant for the portion of the Plan
Quarter that such Participant was employed by such Employer.



     5.02 Allocation to a Participant Transferred to an Affiliated Company
Which Has Not Adopted the Plan. Notwithstanding any other provisions of the
Plan to the contrary, if a Participant who is an Eligible Employee ceases to be
an Eligible Employee or is transferred from an Employer to an Affiliated
Company, he or she shall continue to participate in the Plan as provided in
Section 5.08 hereof as a Participant who has elected a voluntary suspension of
Elective Contributions. If such Participant is subsequently reemployed by an
Employer or returns to Eligible Employee status, he or she shall be eligible to
elect to have made on his or her behalf Elective Contributions from and after
the day on which occurs such transfer back to an Employer or return to Eligible
Employee status, provided he or she complies with the provisions of Section
4.02 of the Plan.


     5.03 Method of Allocating Company Contributions.


          5.03(1) Subject to Sections 5.04, 5.05 and 5.06, the total Company
Contribution made for each Plan Quarter and any Forfeitures pursuant to
Subsection 5.01(1) or Section 12.06 hereof shall be allocated as of the last
day of such Plan Quarter among the Company



31






 





Contribution Accounts of all Participants who were Eligible Employees for
all or any part of such Plan Quarter. Each such Participant’s allocable share
of Company Contributions and any Forfeitures shall be in the proportion that
his or her Compensation while an Eligible Employee for such Plan Quarter bears
to the total Compensation of all such Participants while Eligible Employees for
such Plan Quarter.


          5.03(2) Any amounts credited to a Participant’s Company Contribution
Account shall, for all purposes and in all respects, be fully vested and
nonforfeitable.



          5.03(3) If, during a Plan Quarter, a Participant is transferred from one
Employer to another Employer, such Participant’s share of each Employer’s
Company Contributions shall be determined on the basis of the Compensation
received by such Participant from each such Employer.



     5.04 Limitation on Annual Additions.


          5.04(1) Notwithstanding any other provision of the Plan, the sum of the
Annual Additions to a Participant’s Account for any Limitation Year shall not
exceed the lesser of:



          (i) Thirty Thousand Dollars ($30,000) for Plan Years ending prior to 2001;
Thirty Five Thousand Dollars ($35,000) for Plan Years ending in 2001 or
commencing in 2001 and ending in 2002, and Forty Thousand Dollars ($40,000) for
Plan Years commencing on or after January 1, 2002 adjusted for each subsequent
Plan Year to reflect cost of living increases for the Plan Year provided under
Code Section 415(d) or published by the Secretary of the Treasury, or



          (ii) twenty-five percent (25%) of such Participant’s Limitation Year
Compensation for the entire Limitation Year (even though such Participant may
not have been a Participant for the entire Limitation Year) for Limitation
Years commencing prior to 2002, and 100% of such Participant’s Limitation Year
Compensation for the entire Limitation Year (even though such Participant may
not have been a Participant for the entire Limitation Year) for Limitation
Years commencing in 2002 or later. This paragraph (ii) shall not apply to any
contribution for medical benefits after separation from service within the
meaning of Code Section 401(h) or 419.



          If a Limitation Year is less than a 12-consecutive month period, the above
dollar limitations for the short Limitation Year shall not exceed the amount
determined in the preceding sentence multiplied by a fraction, the numerator of
which is the number of whole months in the short Limitation Year and the
denominator of which is twelve (12). The term “Annual Additions” to a
Participant’s Account for any Limitation Year shall mean the sum of:



               (a) such Participant’s allocable share of the Company Contributions and
Company Matching Contributions credited to such Participant within such
Limitation Year; and



               (b) the amount of such Participant’s Elective Contributions (including any
amounts characterized as Excess Contributions and amounts characterized as
Excess Deferrals, if such Excess Deferrals are not distributed as provided for
in Subsection 4.03(7) hereof), and Excess Aggregate Contributions under the
Plan, if any, for such Limitation Year; and




32






 





               (c) such Participant’s allocable share of Forfeitures, if any, credited to
such Participant within such Limitation Year; and



               (d) any amount allocated to an “individual medical account,” as defined in
Code Section 415(1)(2), which is part of a Defined Benefit Plan maintained by
an Employer; and



               (e) any amounts derived from contributions paid or accrued after December
31, 1985, in taxable years ending after such date, which are attributable to
post-retirement medical benefits allocated to the separate account of a key
employee (as defined in Code Section 419A(d)(3)) under a welfare benefit fund
(as defined in Code Section 419(e)) maintained by an Employer.



          Solely for purposes of this Section 5.04, the determination of a
Participant’s Elective Contributions and after-tax employee contributions, if
any, for a Limitation Year shall exclude the items set forth in Sections
1.415-6(b)(3)(i)-(iv) of the Income Tax Regulations, and the determination of a
Participant’s allocable share of Company Matching Contributions, Company
Contributions and Forfeitures, if any, for a Limitation Year shall exclude any
Company Matching Contributions, Company Contributions, Elective Contributions,
if any, and Forfeitures, if any, allocated to such Participant for any of the
reasons set forth in Sections 1.415-6(b)(2)(ii)-(vi) of the Income Tax
Regulations (except as otherwise provided in such Sections).



          5.04(2) In the event that as a result of: (i) a reasonable error in
estimating Participant’s Limitation Year Compensation, or (ii) other facts and
circumstances which the Internal Revenue Service finds justify the availability
of the provisions of this Subsection 5.04(2) and Subsections 5.04(3) and
5.04(4), it is determined that, but for the limitations contained in Subsection
5.04(1), the Annual Additions to a Participant’s Account for any Limitation
Year would be in excess of the limitations contained herein, such Annual
Additions shall be reduced to the extent necessary to bring such Annual
Additions within the limitations contained in Subsection 5.04(1) by reducing
such Participant’s allocable share of Forfeitures, if any, and Company
Contributions for the Plan Year ending within such Limitation Year, then by
reducing such Participant’s allocable share of Company Matching Contributions
for the Plan Year ending within such Limitation Year, and then by reducing
Elective Contributions made on such Participant’s behalf for the Plan Year
ending within such Limitation Year and distributing such Elective Contributions
(and income attributable to such Contributions) to the Participant.



          5.04(3) If, and to the extent that the amount of any Participant’s
allocable share of Forfeitures, if any, or Company Contributions or Company
Matching Contributions, if any, pursuant to Sections 4.01 and 4.04 hereof are
reduced in accordance with the provisions of Subsection 5.04(2) above, the
amount of such reduction shall be used to reduce the applicable contributions
made for such Participant for the next Limitation Year (and succeeding
Limitation Years, as necessary), if that Participant is covered by the Plan as
of the end of the Limitation Year. However, if that Participant is not covered
by the Plan as of the end of the Limitation Year, then such amounts shall be
maintained in a separate suspense account under the Trust for the Limitation
Year and allocated and reallocated in the next Limitation Year among all of the
remaining Participants in the Plan in the manner prescribed in Section 5.03 for
the allocation of any Company Contributions. If in said next Limitation Year,
after the allocations as provided for




33






 





herein, there are any amounts remaining which cannot be allocated to any
Participant as a result of the limitations contained herein, such amount shall
be maintained in a separate suspense account under the Trust to be used to
reduce Company Contributions in the next Limitation Year (and succeeding
Limitation Years, as necessary) for all of the remaining Participants in the
Plan.


          5.04(4) Any suspense account established pursuant to this Section 5.04
shall not be adjusted to reflect net income, loss, appreciation or depreciation
in the value of the Trust Fund as provided for an Employee’s regular Accounts
pursuant to Section 6.04 of the Plan. Notwithstanding any other provision of
the Plan to the contrary, in the event amounts are credited to a suspense
account, no Company Contributions, Company Matching Contributions or Elective
Contributions shall be made to the Plan for a Plan Year while there are any
amounts in such separate suspense accounts attributable to prior Plan Years
which cannot be allocated to Participants in accordance with the terms of this
Subsection.



     5.05 Limitations on Annual Additions for Employers or Affiliated
Companies Maintaining Other Defined Contribution Plans. In the event that any
Participant in this Plan is also a participant under any other Defined
Contribution Plan maintained by an Employer or an Affiliated Company (whether
or not terminated), the total amount of Annual Additions to such Participant’s
accounts under all such Defined Contribution Plans shall not exceed the
limitations set forth in Subsection 5.04(1) hereof. If such total amount of
Annual Additions to a Participant’s accounts under all such Defined
Contribution Plans does exceed the limitations set forth in Subsection 5.04(1)
hereof, then the Annual Additions to such Participant’s Accounts in this Plan
shall be reduced, and such reduction shall be accomplished in accordance with
the provisions of Section 5.04 hereof.


     5.06 Limitations on Annual Additions for Employers or Affiliated
Companies Maintaining Defined Benefit Plans. Code Section 415(e) ceased to
apply to this Plan effective January 1, 2000.


     5.07 Definitions for Purposes of Determining the Annual Addition
Limitations. For purposes of Sections 5.04, 5.05 and 5.06 hereof and this
Section 5.07, the following definitions shall apply:


          5.07(1) “Retirement Plan” shall mean (a) any profit-sharing, pension or
stock bonus plan described in Code Sections 401(a) and 501(a), (b) any annuity
plan or annuity contract described in Code Section 403(a) or 403(b), and (c)
any simplified employee pension plan described in Code Section 408(k).



          5.07(2) “Defined Benefit Plan” shall mean any Retirement Plan which does
not meet the definition of a Defined Contribution Plan.



          5.07(3) “Defined Contribution Plan” shall mean a Retirement Plan which
provides for an individual account for each participant and for benefits based
solely on the amount contributed to the participant’s account, and any income,
expenses, gains or losses, and any forfeitures of accounts of other
participants which may be allocated to such participant’s account. For
purposes of Sections 5.04, 5.05 and 5.06, a Participant’s voluntary
nondeductible contributions to a Defined Benefit Plan shall be treated as being
part of a separate Defined Contribution Plan.




34






 





          5.07(4) “Limitation Year” shall mean the Plan Year.



          5.07(5) “Limitation Year Compensation” shall mean an Employee
Participant’s total compensation for services rendered to an Employer during a
Limitation Year, as reported in Box 10 on Form W-2 or other similar location on
any successor federal wage statement as taxable for federal income tax purposes
but determined without regard to any rules that limit the amount taken into
account based on the nature or location of the employment or the services
performed (such as the exception for agricultural labor in Code Section
3401(a)(2)). Compensation shall not include amounts paid or reimbursed by the
Employer or Affiliated Company for moving expenses incurred by an Employee
Participant, but only to the extent that at the time of the payment it is
reasonable to believe that these amounts are deductible by the Employee
Participant under Code Section 217.



     5.08 Cessation of Eligible Employee Status. Subject to the exception at
Section 5.02, if any Participant does not incur a Termination of Employment but
ceases to be an Eligible Employee as defined in Section 2.14 hereof, then,
during the period that such Participant is not an Eligible Employee as defined
in such Section 2.14 hereof: (i) such Participant shall not have any Elective
Contributions made on his behalf, (ii) except for any Company Contributions
pursuant to Section 4.01 or Company Matching Contributions pursuant to Section
4.04 hereof owing for the Plan Quarter in which such Participant ceases to be
an Eligible Employee, such Participant shall not receive any further allocation
of any Company Contributions and Forfeitures, if any, or Company Matching
Contributions, if any, under the Plan pursuant to Sections 5.01 and 5.03, and
(iii) such Participant’s Accounts shall continue to share in the earnings or
losses of the Trust Fund


ARTICLE VI



ACCOUNTS AND VALUATION OF TRUST FUND



     6.01 Participant’s Accounts. The assets of the Trust Fund shall
constitute a single fund in which each Participant, Beneficiary or Alternate
Payee shall have his proportionate interest as provided in this Plan. The
Committee shall maintain, or cause to be maintained, with respect to each
Employer, individual Accounts for each Participant, Beneficiary or Alternate
Payee. A Participant shall have a Company Contribution Account, a Company
Matching Contribution Account, and an Employee Elective Contribution Account,
and, if applicable, an ESOP Employer Contribution Account and/or an ESOP
Employee Contribution Account and/or a Rollover Account, and, where
appropriate, an Alternate Payee shall have a QDRO Account. Each Account shall
reflect the credits and charges allocable thereto in accordance with the Plan.
The Committee shall maintain, or cause to be maintained, records which will
adequately disclose at all times the state of the Trust Fund and of each
separate interest therein. The books, forms and methods of accounting shall be
entirely in the hands of and subject to the supervision of the Committee.


     6.02 Accounts of Participants Transferred to an Affiliated Company. If a
Participant is transferred to an Affiliated Company and his or her Accounts are
not transferred pursuant to Section 6.06, the amount in the Trust which is
credited to his Accounts shall continue to share in


35






 


the earnings or losses of the Trust Fund, and such Participant’s rights
and obligations with respect to such Accounts shall be governed by the
provisions of the Plan and Trust.


     6.03 Valuation of the Trust Fund and Account Statements.


          6.03(1) Within a reasonable time after each Valuation Date, the Committee
shall have the Trustee prepare a statement of the condition of the Trust Fund
as of the close of business of such Valuation Date setting forth: (i) the
assets of the Trust Fund as of such Valuation Date, and the cost and current
value thereof as defined in ERISA Section 3(26) (the “Current Value”), and (ii)
all investments, receipts, disbursements and other transactions effected by it
during the Valuation Period. The Current Value of any shares of Company Stock
that are not readily tradeable on an established securities market shall be
determined by an independent appraiser meeting requirements similar to the
requirements of the Treasury Regulations under Section 170(a)(1) of the Code.
This statement shall be delivered to the Committee. As soon as practicable
after each Valuation Date, the Committee shall cause to be prepared, and shall
deliver to each Participant, Beneficiary or Alternate Payee, a report
disclosing the status of each such individual’s Accounts in the Trust Fund.



          6.03(2) The Trustee’s determination of the Current Value of the assets in
the Trust Fund and the Committee’s charges or credits to the individual
Accounts with respect to Participants, Beneficiaries or Alternate Payees, as
provided in Section 6.04, shall be final and conclusive on all persons ever
interested hereunder.



     6.04 Periodic Determination of Participant’s Accounts.


          6.04(1) Allocations in General. For the purpose of making allocations as
of any Valuation Date, except as otherwise provided herein, the Net Earnings
and Adjustments in Value of the Trust Fund shall be allocated pursuant to
Subsection 6.04(3) below, the Net Earnings and Adjustments in Value of the Cash
Dividend Account shall be allocated pursuant to Subsection 6.04(4) hereof,
Rollover Contributions received during such Valuation Period shall be allocated
pursuant to Subsection 4.07(1) hereof, and Elective Contributions, Company
Contributions and Company Matching Contributions made for such Valuation Period
shall be allocated pursuant to Section 4.05 hereof. Whenever an allocation or
credit is required to be made hereunder, it shall be made by the Committee, or
at the Committee’s direction and subject to its supervision.



          6.04(2) Determination of Net Earnings and Adjustments In Value.



               (a) “Net Earnings and Adjustments in Value of the Trust Fund” for a
particular Valuation Period means the Current Value of the Trust Fund as of the
Valuation Date (determined pursuant to Section 6.03 hereof) less the sum of:



                    (i) The total of all Account balances respectively as of the first (1st)
day of such Valuation Period of all Participants, Beneficiaries and Alternate
Payees as of such time whose Accounts had not been segregated under Subsection
4.07(3) hereof; and



                    (ii) Company Contributions, Company Matching Contributions, Elective
Contributions and Rollover Contributions for the Valuation Period under
consideration, to the extent that such Company Contributions, Company Matching



36






 





Contributions, Elective Contributions and Rollover Contributions were
actually paid over to the Trustee and not otherwise distributed to
Participants, Beneficiaries or Alternate Payees prior to the close of such
Valuation Period; and


                    (iii) The amount credited to the Cash Dividend Account as of such
Valuation Date.



               (b) “Net Earnings and Adjustments in Value of the Cash Dividend Account”
means the Current Value of the Cash Dividend Account as of the Valuation Date
(determined pursuant to Section 6.03 hereof) less the sum of:



                    (i) The Cash Dividend Account balance as of the first (1st) day of such
Valuation Period; and



                    (ii) All cash dividends credited to such Cash Dividend Account which were
actually paid over to the Trustee during such Valuation Period and not
otherwise distributed prior to the dose of such Valuation Period.



          6.04(3) Allocation of Net Earnings and Adjustments in Value of the Trust
Fund. Subject to the provisions of Subsections 6.04(2) and 6.04(4) hereof, the
Net Earnings and Adjustments in Value of the Trust Fund for a particular
Valuation Period shall be allocated as of the Valuation Date to those Accounts
that had not, for such Valuation Period been segregated under Subsection
4.07(3) hereof, and the total value of which had not been distributed prior to
the Valuation Date, as follows: Such Net Earnings and Adjustments in Value of
the Trust Fund shall be credited to or charged against such Accounts in
proportion to the average funds credited to each such Account during such
Valuation Period.



          6.04(4) Payment of Cash Dividends.



               (a) Notwithstanding the foregoing provisions of this Article VI, any cash
dividends received by the Trustee with respect to shares of Company Stock held
under the Plan on the record date for such dividends and allocated under the
Plan to one or more of the Accounts of the Participants (whether or not so
allocated on such record date), will be paid in accordance with one of the
following methods, as determined by the Sponsoring Company in its sole
discretion:



               (i) To such Participant (or the Participant’s Beneficiary following the
Participant’s death), or



               (ii) To the Trust Fund and distributed to such Participant (or the
Participant’s Beneficiary following the Participant’s death), or



               (iii) To the Trust Fund and invested in additional Company Stock on or as
soon as administratively feasible after the dividend payment date.



               (b) In lieu of direct payment in cash under subsection (a)(i), the
Sponsoring Company may permit a Participant (or Beneficiary following the
Participant’s death)



37






 





to direct that such payment instead be invested in Company Stock in the
name of the Participant (or Beneficiary), and not owned by or subject to the
provisions of this Plan.


          6.04(5) Computations. All of the computations required to be made under
the provisions of this Article VI, when made, shall be conclusive with respect
thereto and shall be binding upon all the Participants, Beneficiaries,
Alternate Payees, and all other persons ever having an interest in the Trust
Fund.



     6.05 Correction of Participants’ Accounts. If an error or omission is
discovered in the Accounts of a Participant, or in the amount distributed to a
Participant, the Committee, as authorized by Section 13.05 hereof, shall make
such equitable adjustments in the records of the Plan as may be necessary or
appropriate to correct such error or omission as of the Plan Year in which such
error or omission is discovered. Further, an Employer may, in its discretion,
make a special contribution to the Plan which shall be allocated by the
Committee only to the Accounts of a Participant as is necessary to correct such
error or omission.


     6.06 Transfers To Non-Bargaining Unit NCE Plan. The Sponsoring Company
shall cause a direct transfer of a Participant’s Accounts between defined
contribution plans sponsored by the Sponsoring Company as follows:


          (a) Transfers From This Plan. If a Member ceases to be an active Member
in the Plan and thereafter is an active participant in another defined
contribution plan maintained by the Sponsoring Company that benefits
non-collectively bargained employees, the Member’s Accounts shall be
transferred to the other plan. Following such a transfer, the Member shall
have no right to benefits from this Plan.



          (b) No Transfers To This Plan. No transfers shall be made to this Plan
under this section.



          (c) Time or Form of Transfer. The Company shall determine the date as of
which any transfer between plans shall occur. The Company shall also determine
whether the transfer shall be in cash or in kind or partly in each. Transfers
in kind may include the promissory note with respect to any outstanding loan
from a plan to the Participant.



          (d) No Reduction of Benefits. No such transfer shall occur unless the
Company determines that the requirements of Sec. 17.02 have been satisfied.



ARTICLE VII



RETIREMENT BENEFITS



     A Participant who continues in the Employer’s employment after his
Retirement Date shall continue to be a Participant in the Plan until his actual
retirement. In addition, any Participant who has retired under a defined
benefit pension plan maintained by the Sponsoring Company and has immediately
commenced the receipt of monthly retirement income from said Retirement Plan
shall be deemed to have retired under this Article VII. Upon actual retirement


38






 


on or after his Retirement Date or as otherwise provided herein, a
Participant shall be entitled to the benefits provided for in this Article VII.
Subject to the provisions of Subsections 11.01(2), 11.02(1) and 12.03(2)
hereof, any Participant who becomes entitled to benefits under this Article VII
shall receive benefits equal to the total amounts in his Accounts valued as of
the Valuation Date coinciding with or immediately following the date on which
such Participant becomes entitled to such benefits. Payment upon retirement
shall be made by the Trustee at the direction of the Committee at the time and
manner provided in Article XI hereof.


ARTICLE VIII



DISABILITY BENEFITS



     8.01 Disability Retirement Benefits. If a Participant retires by reason
of Total and Permanent Disability while in the employ of an Employer or an
Affiliated Company or on Leave of Absence, subject to the provisions of
Subsections 11.01(2), 11.02(1) and 12.03(2) hereof, he shall be entitled to
receive benefits equal to the total amounts in his Accounts valued as of the
Valuation Date coinciding with or immediately following the date on which such
Participant retires on account of Total and Permanent Disability. However, if
distribution is delayed because the Participant’s Account balances exceed
$3,500 (for distributions prior to January 1, 1998) or $5,000 (for
distributions on or after January 1, 1998), such distribution shall be based
upon the balance in such Participant’s Accounts as of the Valuation Date
coinciding with or immediately preceding the earlier of (iv) the date of the
Participant’s election to receive such distribution, or (v) the date on which
such Participant attains age sixty-five (65) or dies. Payments resulting from
a Participant’s retirement on account of Total and Permanent Disability shall
be made by the Trustee at the direction of the Committee at the time and in the
manner provided in Article XI hereof.


     8.02 Determination of Disability. The Committee shall determine whether
a Participant has suffered Total and Permanent Disability, and its
determination in that respect is binding upon the Participant, provided that
the Committee may rely upon professional medical advice in making such
determination. In making its determination, the Committee may require the
Participant to submit to medical examinations by doctors selected by the
Committee. The provisions of this Article VIII shall be uniformly and
consistently applied to all Participants.


ARTICLE IX



DEATH BENEFITS



     9.01 Death Benefits. Upon the death of a Participant while in the employ
of an Employer or an Affiliated Company or on Leave of Absence, subject to the
provisions of Subsections 11.01(2), 11.02(1) and 12.03(2) hereof, his
Beneficiary, determined in accordance with Section 9.02 hereof, shall receive,
provided proper proof of death has been filed with the Committee, the full
amount of his Accounts as of the Valuation Date coinciding with or immediately
following the date on which the Participant dies.


     Upon the death of a Participant who is no longer employed by an Employer
or an Affiliated Company, his Beneficiary, determined in accordance with
Section 9.02, shall receive


39






 


the balance of such Participant’s Accounts as of the Valuation Date
coinciding with or immediately following the date on which the Participant
died.


     Payments resulting from the death of a Participant shall be made by the
Trustee at the direction of the Committee at the time and in the manner
provided in Article XI hereof.


     9.02 Designation of Beneficiaries.


          9.02(1) Subject to the provisions of Section 3.06 and Subsections 9.02(2)
and 12.03(2) hereof, each Participant may designate a Beneficiary or
Beneficiaries, and contingent Beneficiary or Beneficiaries, if desired,
including the executor or administrator of his estate, to receive his interest
in the Trust Fund in the event of his death, but the designation of a
Beneficiary shall not be effective for any purpose unless and until it has been
filed with the Committee on the form provided therefor. If the Participant has
a surviving spouse and the surviving spouse consented to the naming of another
Beneficiary in accordance with Subsection 9.02(2) hereof, but the deceased
Participant failed to name a Beneficiary in the manner herein prescribed, or
the Beneficiary or Beneficiaries so named predecease the Participant, the
amount, if any, which is payable hereunder in respect of such deceased
Participant shall be paid to the surviving spouse. If the Participant does not
have a surviving spouse and the deceased Participant failed to name a
Beneficiary in the manner herein prescribed, or the Beneficiary or
Beneficiaries so named predecease the Participant, the amount, if any, which is
payable hereunder in respect of such deceased Participant shall be paid to
either (i) the spouse of the deceased Participant, (ii) the surviving children
of the deceased Participant or on their behalf as provided in Section 11.03
below, (iii) any one or more or all of the next-of-kin of the deceased
Participant in such proportions as the Committee may determine, or (iv) the
legal representative or representatives of the estate of the deceased
Participant. Notwithstanding the foregoing, the Committee may elect to have a
court of applicable jurisdiction determine to whom a payment or payments should
be made. Any payment made to any person pursuant to the power and discretion
conferred upon the Committee by the preceding sentence shall operate as a
complete discharge of all obligations under the Plan in respect of such
deceased Participant and shall not be subject to review by anyone, but shall be
final, binding and conclusive on all persons ever interested hereunder.



          Subject to the provisions of Subsection 9.02(2) below, a Participant may
from time to time change any Beneficiary designated by him without notice to
such Beneficiary, under such rules and regulations as the Committee may from
time to time promulgate, but the last Beneficiary designation filed with the
Committee shall control.



          9.02(2) With respect to a Participant who has been credited with an Hour
of Service on or after August 23, 1984, notwithstanding any other provision
herein to the contrary, but subject to the provisions of Subsection 12.03(2)
hereof, if, as of such Participant’s death, such Participant is married, such
Participant’s Accounts shall, on his death, be paid to the surviving spouse to
whom he was married at the date of his death unless the surviving spouse has
made a Qualified Consent to the payment of any or all of said Accounts to a
designated Beneficiary other than the surviving spouse. “Qualified Consent”
means an irrevocable written consent executed by the Participant’s spouse which
acknowledges the effect of the consent and is witnessed by a Plan
representative or a notary public. A Participant may, after obtaining a




40










 



Qualified Consent, change his Beneficiary designation as permitted by
Subsection 9.02(1) above, but any such change is subject to the requirements of
this Subsection 9.02(2) and will require another Qualified Consent should the
spouse, if surviving, not be the sole Beneficiary of all amounts in the
Account. A Qualified Consent is effective only with respect to the spouse who
executes it. If the Plan Administrator is satisfied that there is no spouse,
or that the spouse cannot reasonably be located, or in such other circumstances
as permitted by governmental regulations, no Qualified Consent shall be
required as a condition to payment, under Section 9.01 hereof, to a Beneficiary
who is not the surviving spouse.


          9.02(3) Where a Participant’s spouse fails to survive the Participant and
has a community interest in a portion of the Participant’s vested interest at
the spouse’s death, and where the Participant may not lawfully retain and
dispose of the whole interest including the community interest of the
non-participating spouse, the non-participating spouse shall be deemed a
Participant entitled to make a Beneficiary designation of his or her community
share; however, the funds shall not be available out of the Trust until the
Participant becomes entitled and the method of payment shall not be controlled
by the method of payment provided for in the Plan. In the absence of a
designation of Beneficiary by the non-participating spouse or if no designee
survives, the Participant’s spouse shall be deemed to have named the
Participant as his or her Beneficiary, if he or she survives, and if not, then
the Beneficiaries (other than the Participant’s spouse) named by the
Participant who survives the Participant. Otherwise, the Committee shall have
the power described in Subsection 9.02(1) hereof to determine the recipients as
in the case of the Participant’s death.



ARTICLE X



EMPLOYMENT TERMINATION BENEFITS



     Subject to the provisions of Subsections 11.01(2), 11.02(1) and 12.03(2)
hereof, in the event of the Termination of Employment of a Participant, such
Participant shall be entitled to receive the entire balance in his Accounts,
all valued as of the Valuation Date coinciding with or immediately following
the date on which such Participant suffered a Termination of Employment. If
distribution is delayed because the Participant’s Account balances exceed
$3,500 (for distributions prior to January 1, 1998) or $5,000 (for
distributions on or after January 1, 1998), such distribution shall be based
upon the entire balance in such Participant’s Accounts as of the Valuation Date
coinciding with or immediately preceding the earlier of (i) the date of the
Participant’s election to receive such distribution, or (ii) the date on which
such Participant attains age sixty-five (65) or dies.


     Payment pursuant to this Article X shall be made by the Trustee, at the
direction of the Committee, at the time and manner provided in Article XI
hereof.


41






 


ARTICLE XI



PAYMENT OF BENEFITS



     11.01 Time and Method for Distribution of Benefits.


          11.01(1) Upon a Participant’s: (i) retirement on or after his
Retirement Date or as otherwise provided in Article VII hereof, (ii) retirement
due to Total and Permanent Disability, (iii) death, or (iv) Termination of
Employment, subject to the provisions of this Section 11.01 and Section 11.02,
the Participant or his Beneficiary shall be entitled to a distribution pursuant
to and in an amount computed in accordance with Article VII, VIII, IX or X, as
the case may be. Except as otherwise provided in this Article XI, and except
to the extent a Participant elects to diversify his Account pursuant to Section
14.03 hereof, the entire amount payable to a Participant or Beneficiary shall
be distributed in a single lump sum in whole shares of Company Stock, or cash
in the case of any fractional shares of Company Stock, as soon as
administratively practicable after the Valuation Date on which such amounts
were valued as provided in Article VII, Section 8.01, Section 9.01 or Article X
as applicable. If a Participant has elected to diversify his Account pursuant
to Section 14.03 hereof, any amounts so diversified will be distributed in a
single lump sum cash payment, at the time provided herein. In no event,
however, will any such distribution be paid later than one year after the close
of the Plan Year:



                    (i) in which the Participant dies or retires after attaining his
Retirement Date under the plan, or retires after sustaining Total and Permanent
Disability; or



                    (ii) which is the fifth Plan year following the Plan Year in which the
Participant has a Termination of Employment for any other reason, provided that
the Participant has not been reemployed before such distribution.



In no event will such amounts be paid later than the sixtieth (60th) day after
the close of the Plan Year in which occurs the latest of:


               (a) The date on which the Participant attains or would have attained
sixty-five (65) years of age or if earlier, his Retirement Date;



               (b) The tenth (10th) anniversary of the year in which the Participant
commenced participation in the Plan; or



               (c) The date the Participant terminates his employment with the Employer
for any reason.



Shares of Company Stock and the certificates representing such shares which are
distributed by the Trustee may contain such restrictions on transferability and
legends regarding restrictions on transfer as the Sponsoring Company may
reasonably require to ensure compliance with applicable federal or state
securities laws.


          11.01(2) Notwithstanding any other provision of this Plan to the
contrary, if actual distribution pursuant to Subsection 11.01(1) above is
delayed for any reason beyond the Valuation Date upon which the amount of such
distribution was to be based, the distribution shall



42






 





be based on the value of the Participant’s Accounts as of the Valuation
Date coinciding with or immediately preceding the date on which such
distribution is actually made.


          11.01(3) Notwithstanding the provisions of Subsection 11.01(1), and
subject to Section 11.02 below, if a Participant has a Termination of
Employment or retires due to Total and Permanent Disability and the vested
portion of the Participant’s Accounts at such time exceed Three Thousand Five
Hundred Dollars ($3,500) for determinations prior to January 1, 1998 or Five
Thousand Dollars ($5,000) for determinations on or after January 1, 1998, the
amounts owing to such Participant shall be distributed in a single lump sum as
soon as administratively practicable after such Participant attains age
sixty-five (65) or dies, unless such Participant delivers to the Committee his
written consent to an earlier distribution.



          11.01(4) Notwithstanding the provisions of Subsection 11.01(1), if a
Participant has elected to direct the investment of a portion of certain
Account balances into investments other than Company Stock pursuant to Article
XIV hereof or if a Participant has cash amounts credited to any of his Accounts
which are earmarked for the purchase of Company Stock but have not been used to
purchase Company Stock on or prior to the Valuation Date upon which the amount
of such Participant’s distribution is to be based, or if the Participant has a
Rollover Account which is invested in whole or in part in investments other
than Company Stock, distribution of such portion or portions of such Account
balances (or such portion or all of his Rollover Account) under Subsection
11.01(1) shall be in cash rather in shares of Company Stock, unless such
Participant elects in writing, within the time prescribed and on a form
provided by the Committee to receive his entire distribution (less the value of
his Rollover Account, if he so elects) in shares of Company Stock pursuant to
Subsection 11.01(1).



          11.01(5) If, upon termination of service for any reason, or, when
distributions are required to commence to a Participant pursuant to Subsection
11.02(1), the value of the vested portion of a Participant’s Accounts is Three
Thousand Five Hundred Dollars ($3,500) or less, then his total Account shall be
paid to or for the benefit of the Participant, or in the case of his death, to
or for the benefit of his Beneficiary or Beneficiaries, only as a non-deferred
lump sum payment as provided in Subsection 11.01(1). Effective January 1,
1998, notwithstanding the foregoing, if the total vested value of the Accounts
of a Participant (or a Beneficiary following the Participant’s death) is $5,000
or less at any time following the date the Participant’s Termination of
Employment or death occurs, a single-sum distribution of the entire vested
benefit shall be made to the Participant (or Beneficiary) as soon as
administratively feasible following the Termination of Employment or death (or
following the date the value is determined to be $5,000 or less, if later)
equal to the value determined as of a Valuation Date selected by the Trustee
which is on or a reasonable time prior to the date the distribution occurs.



     11.02 Limitations on Timing. Notwithstanding any other provision of the
Plan to the contrary, distributions must occur at least as rapidly as required
under this Section 11.02.


          11.02(1) A Participant’s entire interest in the Plan shall be distributed
to him no later than the Required Beginning Date based on the balance in his
Accounts as of the Valuation Date coinciding with or immediately preceding the
Required Beginning Date.




43






 





          11.02(2) In the event of the death of a Participant prior to distribution
of his benefits under the Plan, distribution of such deceased Participant’s
entire interest under the Plan shall be made within five (5) years after the
death of such Participant.



     11.03 Payments on Personal Receipt Except in Case of Minors or Persons
Under a Legal Disability. All payments to any Participant, Beneficiary or
Alternate Payee from the Trust Fund shall be made to the recipient entitled
thereto in person or upon his personal receipt, in a form satisfactory to the
Committee, except when the recipient entitled thereto shall be a minor or under
a legal disability, or, in the sole judgment of the Committee, shall otherwise
be unable to apply such payments in furtherance of his own interests and
advantage. The Committee may, in such event, in its sole discretion, direct
all or any portion of such payments to be made in any one or more of the
following ways: (i) directly to such person, (ii) to the guardian of his
person or of his estate, even if appointed by a court other than a Texas state
court, (iii) to a custodian under any applicable Uniform Gifts to Minors Act or
Uniform Transfers to Minors Act, or (iv) to a person appointed as his personal
representative through a Power of Attorney. Notwithstanding the foregoing, the
Committee may elect to have a court of applicable jurisdiction determine to
whom a payment or payments should be made. The decision of the Committee, in
each case, will be final, binding and conclusive upon all persons ever
interested hereunder, and the Committee shall not be obliged to see to the
proper application or expenditure of any payments so made. Any payment made
pursuant to the power herein conferred upon the Committee shall operate as a
complete discharge of all obligations of the Trustee and the Committee, to the
extent of the amounts so paid.


     11.04 Distribution Limitations Applicable to Elective Contributions.


     Notwithstanding any provisions to the contrary herein, except as otherwise
provided in Sections 4.03 and 4.08 and Subsection 6.04(4) hereof, no
distribution shall be made of any Elective Contributions or the earnings
thereon prior to the earliest of:


               (a) Termination of Employment, retirement, death, or Total and Permanent
Disability.



               (b) Termination of the Plan without establishment of or maintenance of
another successor defined contribution plan as defined in Code Section 414(i)
(other than an employee stock ownership plan as defined in Code Section
4975(e)(7) or Code Section 409 or a simplified employee pension as defined in
Code Section 408(k)) by an Employer or an Affiliated Company at the time of
termination of the Plan or within the period ending twelve months after
distribution of all assets from the Plan; provided, however, that if fewer than
two percent (2%) of the Participants in this Plan at the time of the Plan’s
termination are or were eligible under another defined contribution plan (as
defined in this Subsection) at any time during the twenty-four (24) month
period beginning twelve (12) months before the time of this Plan’s termination,
such other plan is not a successor defined contribution plan.



               (c) The attainment of age fifty-nine and one-half (59-1/2).



     11.05 Distribution Limitations Applicable to ESOP Accounts.
Notwithstanding any other provisions to the contrary in this Plan, except as
otherwise provided in Sections 11.01, 11.02 and 14.03 hereof, and except as
otherwise provided in Code Section 409(d)(2) and (3), no


44






 


distribution of any Company Stock attributable to contributions made by
the Employers under the provisions of the ESOP and allocated to the ESOP
Employer Contribution Accounts and contributions made by participants in the
ESOP and allocated to the ESOP Employee Contribution Accounts shall be made
before the end of the eighty-four (84)-month period which begins the month
immediately following the month in which such Company Stock was allocated to
the appropriate account under the ESOP.


     11.06 Direct Rollovers to Eligible Retirement Plans.


          11.06(1) This Section applies to distributions made on or after January
1, 1993. Notwithstanding any provision of the Plan to the contrary that would
otherwise limit a Distributee’s election under this Section, a Distributee may
elect, at the time and in the manner prescribed by the Committee, to have any
portion of an Eligible Rollover Distribution paid directly to an Eligible
Retirement Plan specified by the Distributee in a Direct Rollover.



          11.06(2) For purposes of this Section 11.06, the following terms shall
have the following meanings:



                 (i) “Eligible Rollover Distribution” means any distribution of all or any
portion of the balance to the credit of the Distributee, except that an
Eligible Rollover Distribution does not include: any distribution that is one
of a series of substantially equal periodic payments (not less frequently than
annually) made for the life (or life expectancy) of the Distributee or the
joint lives (or joint life expectancies) of the Distributee and the
Distributee’s designated Beneficiary, or for a specified period of ten years or
more; any distribution to the extent such distribution is required under Code
Section 401(a)(9); and the portion of any distribution that is not includable
in gross income (determined without regard to the exclusion for net unrealized
appreciation with respect to employer securities).



                    (a) Any hardship withdrawal from a Participant’s Employee Elective
Contribution Account prior to age 591⁄2 pursuant to Sec. 6.02 which is
described in Code section 401(k)(2)(B)(i)(IV) and which occurs after December
31, 1998 and prior to January 1, 2002, and any withdrawal from any of the
Participant’s Accounts due to financial hardship prior to age
591⁄2 pursuant
to Sec. 6.02 which occurs on or after January 1, 2002, is not an eligible
rollover distribution.



                    (b) Commencing January 1, 2002, a portion of a distribution shall not fail
to be an eligible rollover distribution merely because the portion consists of
after-tax employee contributions which are not includible in gross income.
However, such portion may be transferred only to an individual retirement
account or annuity described in Code Section 408(a) or (b), or to a qualified
defined contribution plan described in Code Section 401(a) or 403(a) that
agrees to separately account for the amounts so transferred, including
separately accounting for the portion of such distribution which is includible
in gross income and the portion of such distribution which is not so
includible.



               (ii) “Eligible Retirement Plan” means an individual retirement account
described in Code Section 408(a), an individual retirement annuity described in
Code Section 408(b), an annuity plan described in Code Section 403(a), or a
qualified trust described in Code Section 401(a), that accepts the
distributee’s eligible rollover distribution. Commencing January



45






 





1, 2002, an eligible retirement plan also means an annuity contract
described in Code Section 403(b), or an eligible plan under Code Section 457(b)
which is maintained by a state, a political subdivision of a state, or any
agency or instrumentality of a state or political subdivision of a state and
which agrees to account separately for amounts transferred into such plan from
this Plan. Prior to January 1, 2002, in the case of an eligible rollover
distribution to the surviving spouse, an eligible retirement plan was limited
to an individual retirement account or individual retirement annuity.


                    (iii) “Distributee” means an Employee or former Employee. In addition,
the Employee’s or former Employee’s surviving spouse and the Employee’s or
former Employee’s spouse or former spouse who is the Alternate Payee under a
Qualified Domestic Relations Order are Distributees with regard to the interest
of the spouse or former spouse.



                    (iv) “Direct Rollover” means a payment by the Plan to the Eligible
Retirement Plan specified by the Distributee.



ARTICLE XII



MISCELLANEOUS PROVISIONS RESPECTING PARTICIPANTS



     12.01 Participants to Furnish Required Information.


          12.01(1) Each Participant shall furnish to the Committee such information
as the Committee considers necessary or desirable for purposes of administering
the Plan, and the provisions of the Plan respecting any payments hereunder are
conditional upon the Participant’s furnishing promptly such true, full and
complete information as the Committee may reasonably request.



          12.01(2) Each Participant shall submit proof of such Participant’s age to
the Committee. The Committee shall, if such proof of age is not submitted as
required, use as conclusive evidence thereof, such information as is deemed by
it to be reliable, regardless of the source of such information. Any
adjustment required by reason of lack of proof or the misstatement of the age
of persons entitled to benefits hereunder, by the Participant or otherwise,
shall be in such manner as the Committee deems equitable.



          12.01(3) Any notice or information which according to the terms of the
Plan or the rules of the Committee must be filed with the Committee, shall be
deemed so filed if addressed and either delivered in person or mailed, postage
fully prepaid, to the Committee. Whenever a provision herein requires that a
Participant (or the Participant’s Beneficiary) give notice to the Committee
within a specified number of days or by a certain date, and the last day of
such period, or such date, falls on a Saturday, Sunday, or Employer holiday,
the Participant (or the Participant’s Beneficiary) will be deemed in compliance
with such provision if notice is delivered in person to the Committee or is
mailed, properly addressed, postage prepaid, and postmarked on or before the
business day next following such Saturday, Sunday or Employer holiday. The
Committee may, in its sole discretion, modify or waive any specified notice
requirement; provided, however, that such modification or waiver must be
administratively feasible, must be in the best interest of the Participant, and
must be made on the basis of rules of the Committee which are applied uniformly
to all Participants.



46






 



          12.02 Participants’ Rights in Trust Fund. No Participant or other person
shall have any right, title or interest in, to or under the Trust Fund, or any
part of the assets thereof, except and to the extent expressly provided in the
Plan.



     12.03 Inalienability of Benefits.


          12.03(1) Restrictions on Assignment. The benefits provided hereunder are
intended for the personal security of persons entitled to payment under the
Plan, and are not subject in any manner to the debts or other obligations of
the persons to whom they are payable. The interest of a Participant or such
Participant’s Beneficiary or Beneficiaries may not be sold, transferred,
assigned or encumbered in any manner, either voluntarily or involuntarily, and
any attempt so to anticipate, alienate, sell, transfer, assign, pledge,
encumber, or charge the same shall be null and void; neither shall the Trust
Fund nor any benefits thereunder or hereunder be liable for or subject to the
debts, contracts, liabilities, engagements or torts of any person to whom such
benefits or funds are payable, nor shall they be subject to garnishment,
attachment, or other legal or equitable process nor shall they be an asset in
bankruptcy. All of the provisions of this Section 12.03, however, are subject
to Section 11.03, to withholding of any applicable taxes and to assignments
permitted by Code Section 401(a)(13).



          12.03(2) Exception for Benefit Payable Pursuant to a Qualified Domestic
Relations Order.



                    (a) The prohibitions contained in Subsection 12.03(1) hereof shall not
apply to the creation, assignment or recognition of a right to any benefit
payable with respect to a Participant pursuant to a Qualified Domestic
Relations Order.



                    (b) The Plan Administrator shall establish written procedures for the
determination of the qualified status of a domestic relations order.



                    (c) Upon receiving a domestic relations order, the Plan Administrator
shall notify the Participant and Alternate Payee named in the order, in
writing, of the receipt of the order and the Plan’s procedures for determining
the qualified status of the order. Within a reasonable period of time after
receiving the domestic relations order, the Plan Administrator shall determine
the qualified status of the order and shall notify the Participant and the
Alternate Payee, in writing, of its determination. The Plan Administrator
shall provide notice under this paragraph by mailing such notice to the
individual’s address specified in the domestic relations order, or in a manner
consistent with Department of Labor regulations.



                    (d) During any period in which the issue of whether a domestic relations
order is a Qualified Domestic Relations Order is being determined,
notwithstanding any other provision of the Plan to the contrary, the Committee
shall separately account for the amounts which would have been payable during
such period to an Alternate Payee pursuant to a Qualified Domestic Relations
Order, if such order had been determined to be a Qualified Domestic Relations
Order. During the period such amounts are separately accounted for under the
Plan, such amounts shall remain subject to the general investment provisions of
the Plan. If within the eighteen (18) month period beginning with the date on
which the first payment would be required to be made under such domestic
relations order, the domestic relations order is determined to be a Qualified
Domestic Relations Order, the Committee shall direct the Trustee to



47






 





distribute to the Alternate Payee the separately accounted for amounts
including any earnings (or losses) thereon in accordance with Section 11.05 and
the order. However, if within such eighteen (18) month period, it is
determined that such order is not qualified, or if by the end of such eighteen
(18) month period the issue of qualification is not resolved, then the
Committee shall pay the separately accounted for amounts including any earnings
(or losses) thereon to the person or persons who would have been entitled to
such amounts if there had been no such order.


                    (e) Notwithstanding any other provision of the Plan to the contrary, all
rights and benefits, including rights to make elections or to give directions,
provided to a Participant under this Plan shall be subject to the rights,
benefits and elections or directions afforded to an Alternate Payee, pursuant
to a Qualified Domestic Relations Order, and this Plan shall be interpreted and
administered by the Committee in such manner as to effectuate the provisions of
any such Qualified Domestic Relations Order as they relate to the rights,
benefits and elections or directions afforded to such Alternate Payee under
such Qualified Domestic Relations Order. Furthermore, to the extent provided
in any such Qualified Domestic Relations Order, a former spouse of a
Participant shall be treated as a spouse or surviving spouse for all applicable
purposes under the Plan.



                    (f) The Trustee shall make any payments or distributions required under
this Subsection 12.03(2) by separate benefit checks or other separate
distribution to the Alternate Payee(s).



     12.04 Conditions of Employment Not Affected by Plan. Neither the Plan
nor the Trust nor the Trust Agreement shall confer on any employee, including
any Participant, any right to be retained in the service of any Employer or any
Affiliated Company, and nothing contained herein or in the Trust Agreement
shall be construed in any way to limit or restrict the right of any Employer or
any Affiliated Company to discharge any employee, regardless of whether such
employee is a Participant, or to change such employee’s position or the basis
or amount of such employee’s compensation.


     12.05 Address for Mailing of Benefits.


          12.05(1) Each Participant and each other person entitled to benefits
hereunder shall file with the Committee from time to time in writing such
Participant’s post office address and each change of address. Any payment
hereunder and any communication addressed to a Participant, an Employee or
Beneficiary, at such person’s last address filed with the Committee, or if no
such address has been filed, then at such person’s last address as indicated on
the records of an Employer, shall be deemed to have been delivered to such
person on the date on which such payment or communication is deposited, postage
prepaid, in the United States mail.



          12.05(2) If the Committee is in doubt as to whether payments are being
received by the person entitled thereto, it shall, by registered mail addressed
to the person concerned, at his address last known to the Committee, notify
such person that all unmailed and future payments shall be withheld until he
provides the Committee with a sworn statement, properly notarized, evidencing
his continued life and his proper mailing address.



48






 


     12.06 Unclaimed Account Procedure.


          12.06(1) Neither the Trustee nor the Committee shall be obliged to search
for, or ascertain the whereabouts of any Participant, Beneficiary or Alternate
Payee. The Committee, by certified or registered mail addressed to such
Participant’s, Beneficiary’s or Alternate Payee’s last known address, shall
notify the Participant, Beneficiary or Alternate Payee that such Participant,
Beneficiary or Alternate Payee is entitled to a distribution under this Plan,
and the notice shall quote the provisions of Subsections 12.06(1) and (2). The
Committee shall utilize the services of the Internal Revenue Service (pursuant
to its Policy Statement P-1-187 or any successor thereto) in attempting to
ascertain the current mailing address of a Participant, Beneficiary or
Alternate Payee.



          12.06(2) If any distribution or payment is not claimed by the person
entitled thereto within one (1) year from the date of the mailing of the notice
referred to in subsection (1) above, the Participant’s, Beneficiary’s or
Alternate Payee’s Accounts, valued as of the Valuation Date coinciding with or
immediately preceding the date such one (1) year period ends, shall be
forfeited (“Forfeitures”) and if not used to restore previous Forfeitures as
provided herein, reallocated pursuant to Section 5.03 hereof. If a
Participant, Beneficiary or Alternate Payee makes a claim, at any time, such
Forfeitures shall be restored and the Committee shall direct the Trustee to
distribute such amount to the individual entitled to the distribution. Such
restorations shall be made from Forfeitures which occurred during the Plan Year
pursuant to this Subsection. Should such Forfeitures, if any, be insufficient
to restore the claimed amount owing to any Participant or Beneficiary, the
additional amount necessary for restoration shall be contributed by the
Employer as a special contribution to be specially allocated to the Account of
such Participant or Beneficiary.



          12.06(3) Notwithstanding Subsection 12.06(1) or 12.06(2) above, if upon
termination of the Plan and the liquidation of the Trust, all or any
distribution payable to a Participant or his Beneficiary has not been claimed
after sending the notice described in Subsection 12.06(1) above, the Committee
shall establish an Individual Retirement Account or an interest-bearing,
federally insured account in a bank or savings and loan association in the name
of the Participant or Beneficiary, shall purchase a deferred annuity providing
the form(s) of benefit prescribed in Article XI or, if the Committee is unable
to accomplish any of the foregoing, shall dispose of the Participant’s Account
in any other method permitted by the Code and ERISA. If a Participant’s
Account has been forfeited pursuant to Subsection 12.06(2) above, it shall be
restored upon Plan termination and distributed as provided in the preceding
sentence. The Committee shall direct the Trustee to distribute the
Participant’s Account valued as of the last Valuation Date, or special
valuation date as provided in Section 18.03 hereof, preceding distribution.



ARTICLE XIII



ADMINISTRATION OF THE PLAN



     13.01 Appointment of Committee. The administration of the Plan will be
the responsibility of the Committee which shall be appointed by the Board and
shall consist of at least one (1) but no more than eight (8) members. The
President or Vice President of the


49






 


Sponsoring Company shall certify to the Trustee the names of the members
of the Committee. The Board shall be authorized to remove any member of the
Committee with or without cause by notifying such member and the Chairman, in
writing, and may fill vacancies in the Committee, however caused. A member of
the Committee may resign upon ten (10) days’ prior notice by delivery of his
written resignation to the President of the Sponsoring Company. The Committee
shall have the sole power, duty and responsibility for directing the
administration of the Plan in accordance with its provisions. Until such time
as the Board so determines otherwise, the Committee of this Plan shall be the
Retirement Committee under the Retirement Plan for Employees of Southwestern
Public Service Company.


     13.02 Compensated Expenses of the Committee. The members of the
Committee shall serve without compensation for their services as such, but the
reasonable and necessary expenses of the Committee shall be paid as provided in
Section 13.14. When, in its discretion, the Committee, or any Employer, deems
it advisable, the Committee shall be authorized to have the records of the
Committee and the Trustee audited by an independent auditor, and reasonable and
necessary ( expenses thereby incurred shall be paid as provided in Section
13.14 hereof.


     13.03 Secretary and Agents of the Committee. The Committee or the
Trustee may employ such agents and such clerical and other administrative
personnel as reasonably may be required for the purpose of administering the
Plan. Such administrative personnel shall carry out the duties and
responsibilities assigned to them by the Committee or Trustee, as applicable.
Expenses necessarily incurred for such purpose shall be paid by the Trust Fund
unless paid by the Employers, as provided in Section 13.14.


     13.04 Actions of Committee.


          13.04(1) A majority of the members of the Committee shall constitute a
quorum for the transaction of business, and shall have full power to act
hereunder. Action by the Committee shall be official if approved by a vote of
a majority of the members present at any official meeting. The Committee may,
without a meeting, authorize or approve any action by written instrument signed
by a majority of all of the members. Any written memorandum signed by the
Chairman, or any other member of the Committee, or by any other person duly
authorized by the Committee to act, in respect of the subject matter of the
memorandum, shall have the same force and effect as a formal resolution adopted
in open meeting. The Committee shall give to the Trustee any order, direction,
consent, certificate or advice required or permitted under the terms of the
Trust Agreement, and the Trustee shall be entitled to rely on, as evidencing
the action of the Committee, any instrument delivered to the Trustee when: (i)
if a resolution, it is certified by the Chairman and Secretary, or (ii) if a
memorandum, it is signed by a majority of all of the members of the Committee,
or by a person who shall have been authorized to act for the Committee in
respect of the subject matter thereof.



          13.04(2) A member of the Committee may not vote or decide upon any matter
relating solely to him or vote in any case in which his individual right or
claim to any benefit under the Plan is specifically involved. If, in any case
in which a Committee member is so disqualified to act, the remaining members
then present cannot, by majority vote, act or decide, the Board will appoint a
temporary substitute member to exercise all of the powers of the disqualified
member concerning the matter in which he is disqualified.



50






 





          13.04(3) The Committee shall maintain minutes of its meetings and written
records of its actions, and as long as such minutes and written records are
maintained, members may participate and hold a meeting of the Committee by
means of conference telephone or similar communications equipment which permits
all persons participating in the meeting to hear each other. Participation in
such a meeting constitutes presence in person at such meeting.



     13.05 Authority of Committee. The Committee is authorized to take such
actions as may be necessary to carry out the provisions and purposes of the
Plan and shall have the authority to control and manage the operation and
administration of the Plan, including complying with all reporting and
disclosure requirements under applicable laws and regulations. In order to
effectuate the purposes of the Plan, the Committee shall have the fiduciary
power and discretion to construe and interpret the Plan, to supply any
omissions therein, to reconcile and correct any errors or inconsistencies, to
decide any questions in the administration and application of the Plan, and to
make equitable adjustments for any mistakes or errors made in the
administration of the Plan. The Committee shall also have the power to direct
the purchase by the Trustee of or the investment by the Trustee in any
insurance company investment or annuity contracts acquired for the purpose of
funding benefits under the Plan. All such actions or determinations made by
the Committee, and the application of rules and regulations to a particular
case or issue by the Committee, in good faith, shall not be subject to review
by anyone, but shall be final, binding and conclusive on all persons ever
interested hereunder. In construing the Plan and in exercising its fiduciary
power under provisions requiring Committee approval, the Committee shall
attempt to ascertain the purpose of the provisions in question and when such
purpose is known or reasonably ascertainable, such purpose shall be given
effect to the extent feasible. Likewise, the Committee is, in the exercise of
its fiduciary powers, authorized to determine all questions with respect to the
individual rights of all Participants and their Beneficiaries and Alternate
Payees under this Plan, including, but not limited to, all issues with respect
to eligibility, Compensation, service, valuation of Accounts, allocation of
consolidated contributions and Trust Fund earnings, and retirement or
Termination of Employment, and shall direct the Trustee concerning the
allocation, payment and distribution of all funds held in trust for purposes of
the Plan. The Committee, in the exercise of any discretionary powers
hereunder, shall not exercise that discretion so as to discriminate in favor of
Employees who are officers, shareholders, or highly compensated Employees. The
Committee shall establish investment objectives and monitor, or cause to be
monitored, the investment performance of the Trustee or any Investment Manager
which may be appointed with respect to any assets of the Plan, and shall make
such reports and give such recommendations to the Board as determined to be
appropriate with respect thereto.


     13.06 General Administrative Powers. The Committee shall have authority
to make, and from time to time, revise, rules and regulations for the
administration of the Plan.


     13.07 Plan Administrator. “Plan Administrator” (as defined in Section
3(16)(A) of ERISA) shall mean the Sponsoring Company. Except as otherwise
delegated herein, the Plan Administrator shall exercise such authority and
responsibility as it deems appropriate to comply with the provisions of federal
law and governmental regulations issued thereunder and to carry out any duties
imposed hereby, including, but not limited to, records of Participants’
service, accrued benefits and the percentage of such benefits which are
nonforfeitable under the Plan, notification to Participants, annual
registration with the Internal Revenue Service, annual reports to the
Department of Labor, and furnishing the Trustee with any directions or
information


51






 


regarding income tax withholding required by law. The Plan Administrator
is hereby designated as the agent for service of process unless the Committee
designates another person or entity.


     13.08 Duties of Administrative Personnel. Administrative personnel
appointed pursuant to Section 13.03 hereof, shall be responsible for such
matters as the Committee shall delegate to them by written instrument,
including, but not limited to communications to Employees at the direction of
the Committee, reports to the Committee involving questions of eligibility and
the amount of Compensation of Participants, assisting Participants,
Beneficiaries and Alternate Payees in the completion of forms prescribed by the
Committee, maintenance of records concerning terminated vested Participants,
Participants who have retired and Beneficiaries. Administrative personnel may
not make any decision as to Plan policy, interpretations, practices or
procedures unless the authority to make such decisions has been delegated to
them in writing by the Committee and they accept fiduciary responsibilities in
accordance with the provisions of Section 13.09 hereof. All administrative
personnel shall perform their allocated function within the policies,
interpretations, rules, practices and procedures established by the Committee,
except that administrative personnel shall coordinate matters related to the
Plan with the appropriate departments of each Employer as the Committee
directs.


     13.09 Designation of Named Fiduciaries and Allocation of Responsibility.
ERISA requires that certain persons, who are deemed to be “fiduciaries,” as
defined in ERISA Section 3(21)(A), be designated as “Named Fiduciaries” in the
Plan. The Board, the Committee and the Plan Administrator are hereby
designated Named Fiduciaries. Each Named Fiduciary shall have only the powers,
duties and responsibilities specifically allocated to such fiduciary pursuant
to the terms of this Plan. The Board shall not have power or fiduciary
responsibility hereunder other than the power to name and to remove the persons
who shall comprise the Committee and to continue to those persons such
allocation of fiduciary responsibilities. In addition to all of the other
rights, powers and responsibilities delegated to it hereunder, the Committee
shall have the fiduciary responsibility and the power to appoint (and remove)
one or more Investment Managers, and the Committee shall have the power to
appoint (and remove) the Trustee. Each Named Fiduciary may, by written
instrument, allocate some or all of its responsibilities to another fiduciary
or designate another person to carry out some or all of its fiduciary
responsibilities. The Committee, Plan Administrator and each other fiduciary
under the Plan (including fiduciaries to whom responsibilities are allocated by
a Named Fiduciary) will be furnished a copy of the Plan, and their acceptance
of such responsibility will be made by agreeing in writing to act in the
capacity designated. No Named Fiduciary shall be liable for an act or omission
of any person who is allocated a fiduciary responsibility or who is designated
to carry out such responsibility by a Named Fiduciary, except to the extent
that the Named Fiduciary did not act in accordance with the standards contained
in Subsection 13.10(2) hereof with respect to the allocation or designation of
a fiduciary duty. Any person or group of persons may serve in more than one
(1) fiduciary capacity with respect to the Plan.


     13.10 Action by Fiduciaries.


          13.10(1) Any action herein permitted or required to be taken by an
Employer shall, subject to the provisions of Section 21.07 hereof, be by
resolution of its board of directors or by written instrument signed by a
person or group of persons who has been authorized by resolution of such board
of directors as having authority to take such action. Any action herein



52






 





permitted or required to be taken by the Committee shall be in the manner
specified in Section 13.04 hereof.


               13.10(2) Each fiduciary with respect to the Plan shall perform all of his
duties and responsibilities and exercise his powers hereunder with the care,
skill, prudence, and diligence under the circumstances then prevailing that a
prudent man acting in like capacity and familiar with such matters would use in
the conduct of an enterprise of like character and with like aims, and no
fiduciary shall be liable for any act or failure to act on his part (including
reliance on the advice of counsel) which conforms to that standard, unless:
(i) he knowingly participates in or knowingly undertakes to conceal an act or
omission of another fiduciary of the Plan, with the knowledge that such act or
omission is a breach of fiduciary responsibility, or (ii) knowing of a breach
of fiduciary responsibility, he fails to make reasonable efforts under the
circumstances to remedy the breach, or (iii) by failing to carry out his
specific responsibilities, in accordance with such standard, he has enabled
another fiduciary of the Plan to commit a breach.



               13.10(3) Each fiduciary shall furnish or cause to be furnished to each
other fiduciary all information needed for the proper performance of its
duties. Each fiduciary warrants that any directions given, information
furnished or action taken by it shall be in accordance with the provisions of
the Plan or the Trust Agreement, as the case may be, authorizing or providing
for such direction, information or action.



     13.11 Appointment of Professional Assistants and the Investment Manager.
The Committee may appoint such accountants, counsel, and actuaries and other
advisers as it deems necessary or desirable in connection with the
administration of the Plan. The Committee, in its sole discretion, may appoint
one or more Investment Managers to manage (including the power to acquire or
dispose of) all or any of the assets of the Trust Fund. The Committee shall be
entitled to rely upon and shall not be liable for any act or failure to act in
reliance, on any opinion or reports, which shall be furnished to the Committee
by any such accountant with respect to accounting matters, counsel in respect
to legal matters, or actuary in respect of actuarial matters as long as the
Committee’s reliance is in accordance with the standard set forth in Subsection
13.10(2) hereof. The fees and costs of such services are an administrative
expense to the Plan to be paid out of the Trust Fund except to the extent that
such fees and costs are paid by any of the Employers.


     13.12 Bond. The Committee shall see that the appropriate fiduciaries are
bonded as required by federal law or regulation. Except as required by state
or federal statute, irrespective of this provision, no bond or other security
shall be required of any fiduciary.


     13.13 Indemnity. In the event and to the extent not insured against
under any contract of insurance with an insurance company, the Employers shall
indemnify and hold harmless each “Indemnified Person”, as defined below,
against any and all claims, demands, suits, proceedings, losses, damages,
interest, penalties, expenses (specifically including, but not limited to
counsel fees to the extent approved by the Sponsoring Company or otherwise
provided by law, court costs and other reasonable expenses of litigation), and
liability of every kind, including amounts paid in settlement, with the
approval of the Sponsoring Company, arising from any action or cause of action
related to the Indemnified Person’s act or acts or failure to act. Such
indemnity shall apply regardless of whether such claims, demands, suits,
proceedings, losses, damages,


53






 


interest, penalties, expenses, and liability arise in whole or in part
from (i) the negligence or other fault of the Indemnified Person, except when
the same is judicially determined to be due to gross negligence, fraud,
recklessness, willful or intentional misconduct of such Indemnified Person or
(ii) from the imposition on such Indemnified Person of any penalties imposed by
the Secretary of Labor, pursuant to Section 502(1) of ERISA, relating to any
breaches of fiduciary responsibility under Part 4 of Title I of ERISA.
“Indemnified Person” shall mean each member of the Board of Directors of the
Company, the Committee, the Trustee (other than a corporate Trustee), each
other individual (but not any independent business entity) who is allocated
fiduciary responsibility hereunder, and each individual (but not any
independent business entity) otherwise acting in an administrative capacity
with respect to the Plan.


     13.14 Payment of Expenses.


          13.14(1) The expenses of agents or advisers, the expenses of the Trustee
and any other reasonable expenses of the Committee approved by the Sponsoring
Company or as otherwise provided for in Section 13.02, shall, subject to
Subsection 13.14(2) hereof, be paid by the Plan out of the Trust Fund unless
paid by the Employers. If such expenses are to be paid by the Employers, the
portion thereof payable by each may be determined by the ratio that the number
of Participants who are Employees of each Employer bears to the total of all
such Participants; provided, that if any expense is incurred solely on account
of a single Employer or group of Employers, such expense shall be paid by such
Employer or Employers to the extent and in such proportion as the Sponsoring
Company may determine.



          13.14(2) Notwithstanding any provisions of Subsection 13.14(1) to the
contrary, as reimbursement for the expenses of administering the Plan, the Plan
may pay so much of the amounts paid or incurred during the taxable year as
expenses of administering the Plan as does not exceed the lesser of:



                    (a) The sum of ten percent (10%) of the first One Hundred Thousand Dollars
($100,000.00), and five percent (5%) of any amount in excess of One Hundred
Thousand Dollars ($100,000.00) of the dividends paid to the Plan during the
Plan Year ending with or within the Employer’s taxable year, with respect to
the aggregate Company Stock held in the ESOP Employer Contribution Accounts and
ESOP Employee Contribution Accounts, or



                    (b) One Hundred Thousand Dollars ($100,000.00).



ARTICLE XIV



INVESTMENT IN TRUST FUND



     14.01 Investment in Company Stock Fund.


               14.01(1) Except as otherwise provided in Sections 14.02 or 14.03 hereof,
the Trustee shall invest all Accounts solely in shares of Company Stock which
shall be held by the Trustee in a separate investment fund under the Trust (the
“Company Stock Fund”). The Trustee may acquire those shares in the open market
or may acquire those shares from the Sponsoring Company, either from treasury
stock or from previously authorized but unissued stock, at a price equal to the
average of the high and low, as reported on the composite tape for the New York



54






 





Stock Exchange, on the last day on which Company Stock is traded preceding
the date of purchase by the Trustee of the Company Stock. Monies in amounts
estimated by the Trustee to be needed for cash withdrawals or in amounts too
small to be reasonably invested may be retained by the Trustee in cash in a
separate subaccount under the Company Stock Fund. Likewise, monies may be
retained in cash or invested temporarily in short-term (less than one year) U.
S. Treasury obligations, high grade commercial paper, certificates of deposit
and other money market investments as selected by the Trustee (or in
interest-bearing securities similar to such investments) until such time as
stock is normally purchased by the Trustee in accordance with its
administrative procedures, or during periods when Company Stock is not
reasonably available for purchase, or if, in the opinion of the Trustee, the
purchase of Company Stock might involve a possible violation of any Federal or
state law, including any Federal or state securities law or any regulation or
rule thereunder, or as the Trustee deems to be in the best interest of the
Participants. To the extent not otherwise provided in the Plan, dividends and
other distributions received and gains realized on Company Stock shall, to the
extent permissible, be invested in Company Stock and held in the Company Stock
Fund. Rights to purchase Company Stock issued to the Trustee as stockholder
shall be exercised to the fullest extent practicable through the application of
cash, and if that be insufficient to exercise the rights in full, then through
the application of cash derived from the sale of a part of the rights under a
procedure that will permit the purchase of the maximum number of shares from
the cash thus made available.


          14.01(2) The Committee shall establish and maintain, or cause the Trustee
to establish and maintain procedures and records which will adequately reflect
(i) the number of shares (including fractional shares) of Company Stock in the
Company Stock Fund and/or the cash available for the purchase of Company Stock
attributable to each Account of a Participant, (ii) the dividends accrued in
the form of Company Stock, stock splits and similar changes with respect to
shares of Company Stock attributable to a Participant’s Accounts, (iii) the net
unrealized gain or loss attributable to such shares of Company Stock, and (iv)
the cost basis of all shares of Company Stock attributable to a Participant’s
Accounts.



     14.02 Participant Investment Direction.


          14.02(1) Notwithstanding the provisions of Subsection 14.01(1) hereof,
each Participant may elect to have twenty-five percent (25%) of such
Participant’s Elective Contributions made on and after the Effective Date and
the Company Matching Contributions which are allocated for the benefit of the
Participant on the basis of such twenty-five percent (25%) of the Participant’s
Elective Contributions, and may elect to have any amount credited to a Rollover
Account, to the extent provided for in Section 4.07 hereof, invested in any
Investment Fund established hereunder, including the Company Stock Fund, in
accordance with the rules and procedures established from time to time by the
Committee and communicated in writing to the Participants. To the extent a
Participant fails to direct the investment of all or a portion of such amounts
(other than amounts credited to a Rollover Account), they shall be invested in
the Company Stock Fund. If a Participant fails to direct the investment of all
or any portion of a Rollover Account, the Trustee shall direct and redirect
such investment among the Investment Funds other than the Company Stock Fund as
the Trustee, in its sole discretion, may determine. Any amounts invested in
the Company Stock Fund under this Section 14.02 shall thereafter no longer be
eligible for investment direction pursuant to this Section 14.02. Upon a
Participant’s Termination of Employment or cessation of participation for any
reason, including death, Total



55






 





and Permanent Disability or retirement, if payment of such Participant’s
Accounts is to be deferred pursuant to Section 11.01 hereof, such Participant
(or Beneficiary) shall continue to have the right to direct the investment of
the portion of his Accounts as provided herein.


          14.02(2) On the last day of each Plan Quarter, a Participant may change
such Participant’s designation of the manner for investment of the amounts the
Participant previously directed into Investment Funds other than the Company
Stock Fund and future contributions described in Subsection 14.02(1) made on
behalf of or by the Participant to any other manner of investment permitted
under Subsection 14.02(1) hereof, provided that (1) application for the change
is made in the form and in accordance with the rules prescribed by the
Committee, (ii) any such change shall not become effective unless made within
the time the Committee designates, and (iii) the change shall be applicable to
contributions made after the application for change shall have become
effective, or to the interest of the Participant in each Investment Fund as of
the date the application for change shall have become effective, as the case
may be. In order to comply with applicable federal or state securities laws,
the Committee may establish such rules with respect to the change of investment
designation by Participants as it shall deem necessary or advisable to prevent
possible violations of such laws.



          14.02(3) The Trustee shall maintain such investment funds (including the
Company Stock Fund) as the Committee may direct from time to time, ( for the
investment of the Trust Fund (“Investment Funds”). Such Investment Funds shall
be communicated to Participants in writing. Except as provided hereinafter in
this Section, the assets of each such Investment Fund other than the Company
Stock Fund shall be invested exclusively in shares of the registered investment
company or mutual fund designated by the Committee, provided that such shares
constitute securities described in ERISA Section 401(b)(1). Assets in any such
Investment Fund in amounts estimated by the Trustee to be needed for cash
withdrawals, or in amounts too small to be reasonably invested, or in amounts
designated for the purchase of Company Stock but which have not yet been so
used due to the Trustee’s normal procedures regarding the purchase of Company
Stock, or in amounts which the Trustee deems to be in the best interest of the
Participants, may be retained by the Trustee in cash or invested temporarily.



          14.02(4) Any part or all of an Investment Fund other than the Company
Stock Fund may be invested and reinvested by the Trustee in one or more
collective investment funds or commingled trust funds maintained by the
Trustee, as the same may have heretofore been or may hereafter be established
or amended, so long as the Trustee is a bank or other applicable financial
institution or another fiduciary with respect to the Plan. Any such fund must
be invested principally in assets of the kind specified for the respective
Investment Fund and must be authorized to accept investments by retirement
plans qualified under the provisions of Section 401(a) and exempt under the
provisions of Code Section 501(a). During such period of time as an investment
in or through any such fund shall exist, the declaration of trust of such
collective investment fund or commingled trust fund shall be incorporated by
reference in, and shall constitute a part of, the Trust instrument.



          14.02(5) The Trustee may, in Trustee’s sole discretion, invest cash
balances held by the Trustee, as permitted in Subsection 14.02(3) hereof, from
time to time, in short-term cash equivalents having ready marketability,
including, but not limited to, U.S. Treasury bills, commercial paper (including
such forms thereof, other than Trustee’s own paper, as may be



56






 





available through Trustee’s own trust department), certificates of
deposit, and similar type securities.


     14.03 Diversification of Participant’s Accounts. This Section 14.03
shall apply to (1) the shares of Company Stock, if any, credited to a
Participant’s ESOP Employer Contribution Account and/or his ESOP Employee
Contribution Account, to the extent such shares were acquired by the Plan after
December 31, 1986, and (ii) all of the shares of Company Stock credited to a
Participant’s other Accounts in the Plan, regardless of when such shares were
acquired (hereinafter individually or collectively referred to as “Eligible
Shares”). A Participant who has attained age fifty-five (55) and who has
completed ten (10) or more years of participation in the Plan (including
participation in the ESOP and/or the Tax Benefit Plan) shall be, for purposes
of this Section, an “Eligible Participant.” An Eligible Participant may elect
either to direct the investment of, or to receive a single lump sum
distribution of twenty-five percent (25%) of the Eligible Shares in his
Accounts, after taking into account all shares as to which a prior election
under this Section (or the comparable section under the ESOP and/or Tax Benefit
Plan) has been made. The total number of Eligible Shares subject to election
at any time shall be determined by rounding such Shares to the nearest whole
share. During each year of the period of six (6) consecutive Plan Years
beginning with the Plan Year in which the Participant first becomes an Eligible
Participant, an election hereunder shall be permitted. Each such yearly
election shall be permitted during the period of ninety (90) days after the
close of the applicable Plan Year (the “Yearly Election Period”). During the
last such Yearly Election Period, an Eligible Participant may either elect to
direct the investment of, or to receive a single lump sum distribution of fifty
percent (50%) of the Eligible Shares in his Accounts, taking into account all
Shares as to which he has previously made an election. To the extent an
Eligible Participant makes an election under this Section 14.03, the Eligible
Shares in the Eligible Participant’s Accounts that are subject to the election
shall, no later than ninety (90) days after the end of the Yearly Election
Period, be liquidated, if necessary, and either be invested among the
investment options available for participant direction in accordance with the
instructions of the Eligible Participant pursuant to the provisions of Section
14.02 of the Plan, or be distributed to said Participant in a single lump sum.
Any amounts diversified as provided for in this Section 14.03 through
investment among the investment options shall thereafter be subject to the
rules and other provisions of Sections 14.01 and 14.02 regarding the
reinvestment or change in investment of those amounts.


     14.04 Funding Policy. The Committee shall establish a funding policy and
method consistent with the objectives of the Plan, the investments authorized
under the Trust Agreement and the requirements of Title I of ERISA. The
Committee shall periodically review such funding policy and method. In
establishing and reviewing such funding policy and method, the Committee shall
endeavor to determine the Plan’s short-term and long-term objectives and
financial needs, taking into account the need for liquidity to pay benefits and
the need for investment growth. All actions of the Committee taken pursuant to
this Section 14.04 shall be communicated to the Trustee.


     14.05 Reservation of Cash. In the implementation of its duties under
Section 14.04, the Committee may communicate to the Trustee the need to reserve
from permanent investment from time to time such amounts of cash as it deems
necessary or advisable in the administration of the Plan.


57






 


     14.06 Voting of Company Stock; Tender Offers.


          14.06(1) Voting of Stock – Registered Stock. All Shares of Company
Stock, including fractional shares, held in the Company Stock Fund for a
Participant’s various Accounts shall be voted by the Trustee in accordance with
the directions of the Participant acting in his right as a shareholder. The
Trustee shall combine fractional shares to the extent possible to reflect the
direction of the Participants holding fractional shares. The Trustee shall
establish such uniform and nondiscriminatory procedures as it deems necessary
or appropriate in order to effectuate the voting rights granted to Participants
hereunder. The Trustee shall be bound to follow the instructions of
Participants, acting as named fiduciaries under Section 403(a)(1) of ERISA,
with respect to voting of shares of Company Stock which have been allocated to
Accounts; provided, however, that if a Participant does not respond in a timely
fashion to the solicitation of voting instructions, the shares of Company Stock
allocated (or treated as having been allocated) to such Participant’s Accounts
shall, to the extent consistent with ERISA, be voted by the Trustee in its sole
discretion.



          14.06(2) Voting of Company Stock – Non-Registered Stock.



                    (a) Notwithstanding the provisions of Subsection 14.06(1), if any Company
Stock allocated to a Participant’s Accounts is not a “registration type class
of securities,” the Participant shall be entitled to instruct the Trustee with
respect to voting such Company Stock (in accordance with the provisions of
Subsection 14.06(1)) only with respect to any corporate matter which involves
the approval or disapproval of any corporate merger or consolidation,
recapitalization, reclassification, liquidation, dissolution, sale of
substantially all assets of a trade or business, or such similar transaction as
the Secretary of the Treasury may prescribe ( in regulations pursuant to the
provisions of Section 409(e) of the Code.



                    (b) If a matter is to be submitted to the holders of Company Stock which
is not a “registration type class of securities” and it is not necessary that
the Participant be entitled to instruct the Trustee with respect to voting in
accordance with this Section, the Trustee, in its discretion, shall vote all
shares of such Company Stock held by it (or exercise dissenter’s rights, if
applicable), after consultation with the Committee. “Registration type class
of securities” shall mean any class of securities required to be registered
under Section 12 of the Securities Exchange Act of 1934, or exempt from such
registration solely by reason of Section 12(g)(2)(h) (concerning interests in
pooled investment vehicles issued to annuity plans or qualified pension, profit
sharing, or stock bonus plans).



     14.06(3) Tender or Exchange Offers.


                    (a) In the event of a tender offer, exchange offer, or other offer for 10%
or more of the shares of Company Stock held in the Company Stock Fund in the
Trust (such offer hereinafter referred to as an “Offer”), the Trustee shall
cause each Participant to whose Account any shares are credited to be advised
in writing of the terms of the Offer as soon as practicable after the
commencement of the Offer and shall furnish each Participant with a form by
which the Participant may instruct the Trustee confidentially whether or not to
tender shares Credited to his Account. For purposes of this Section, “Tender”
shall mean tender, exchange, sale or any other form of disposition in
connection with an Offer. The Trustee shall immediately notify the Committee
of any Offer made to the Trustee including all terms and conditions of any



58






 





such Offer. The Trustee shall tender those shares which a Participant,
acting as a named fiduciary under Section 403(a)(1) of ERISA, has so instructed
it to tender, and the Trustee shall not tender shares which it is instructed
not to tender. If a Participant does not respond in a timely fashion to the
solicitation for instructions regarding a Tender, the decision on whether or
not to tender the shares allocated to such Participant’s Accounts shall, to the
extent consistent with ERISA, be made by the Trustee in its sole discretion.
The provisions of this Section 14.06(3) are intended to establish each
Participant as a named fiduciary as defined in Section 403(a)(1) of ERISA in
connection with any such Tender; however, to the extent the Trustee retains any
fiduciary responsibility with respect to any such Tender, the Trustee shall not
be required to take any action, or omit to take any action, which would cause
the Trustee to commit a breach of fiduciary duty under ERISA.


                    (b) In advising Participants of the terms of the Offer, the Trustee shall
advise the Participant that if the Trustee receives no instructions, the
decision on whether or not to Tender the shares allocated to the Participant’s
Accounts will be made by the Trustee in its sole discretion, and shall provide
Participants with such documents relating to the Offer as are prepared by any
person and provided to shareholders. In addition, the Trustee may provide
Participants with such other material concerning the Offer as the Trustee in
its sole discretion determines to be appropriate. Reasonable means shall be
employed by the Trustee to provide confidentiality with respect to the
tendering directions by each Participant, and the Trustee shall hold such
directions in confidence and shall not divulge or release such directions to
any person, including all Employers or any director, officer, employee or agent
of an Employer, it being the intent of this provision to ensure that the
Employers (and their directors, officers, employees and agents) cannot
determine the tendering directions given by any Participant. A Participant’s
instructions to the Trustee to tender shares shall not be deemed a withdrawal
or suspension from the Plan or a forfeiture of any portion of the Participant’s
interest in the Plan. The Committee shall advise the Trustee of the
commencement date of any Offer and, until receipt of such advice, the Trustee
shall not be obligated to take any action under this Section.



                    (c) Funds or property received in exchange for tendered stock shall be
credited to the Accounts of the Participants whose stock was tendered. If
Company Stock is available on a national securities exchange, such funds or
property may be used by the Trustee to purchase Company Stock. Pending
investment in Company Stock pursuant to the preceding sentence, the Trustee
shall invest such funds in Authorized Investments permitted under the Trust
Agreement.



ARTICLE XV



PARTICIPATION BY EMPLOYERS



     15.01 Adoption of Plan by Affiliated Company. Any Affiliated Company,
whether or not presently existing, may adopt this Plan, effective as of the
date indicated in the instrument of adoption, if (i) its application is made in
writing to the Board, (ii) such application is accepted in writing by the
Board, and (iii) such Affiliated Company executes an instrument in writing duly
authorized by it adopting this Plan and the Trust forming a part hereof and
delivers a copy thereof to the Committee, the Trustee and to the Board. The
provisions of this Plan shall apply


59






 


only to each Employer severally, except as otherwise specifically provided
herein or in such Employer’s instrument of adoption.


     15.02 Rights and Obligations of the Sponsoring Company and the Employers.
Throughout this instrument, a distinction is purposely drawn between rights
and obligations of the Sponsoring Company and rights and obligations of each
other Employer. The rights and obligations specified as belonging to the
Sponsoring Company shall belong only to the Sponsoring Company. Each Employer
shall have the obligation, as hereinafter provided, to make Company
Contributions, Company Matching Contributions and Elective Contributions for
its own Participants, and no Employer shall have the obligation to make Company
Contributions, Company Matching Contributions or Elective Contributions for the
Participants of any other Employer. Any failure by an Employer to fulfill its
own obligations under this Plan shall have no effect upon any other Employer.
An Employer may withdraw from this Plan without affecting any other Employer.


     15.03 Withdrawal from Plan.


          15.03(1) Notice of Withdrawal. Any Employer may, with the approval of
the Board, as of any Valuation Date withdraw from the Plan upon giving the
Committee and the Trustee at least thirty (30) days’ notice in writing of its
intention to withdraw.



          15.03(2) Trustee Segregation of Trust Assets upon Withdrawal. Upon the
withdrawal by an Employer pursuant to this Article, the Trustee shall segregate
the share of the assets in the Trust Fund, the value of which shall equal the
total credited to the Accounts of Participants of the withdrawing Employer.
The determination as to which assets are to be so segregated shall be made by
the Trustee in its sole discretion.



          15.03(3) Exclusive Benefit of Participants. Neither the segregation and
transfer of any Trust assets upon the withdrawal of an Employer nor the
execution of a new agreement and declaration of trust by such withdrawing
Employer shall operate to permit any part of the Trust Fund to be used for or
diverted to purposes other than for the exclusive benefit of the Participants.



          15.03(4) Applicability of Withdrawal Provisions. The withdrawal
provisions contained in this Article XV shall be applicable only if the
withdrawing Employer continues to cover its Participants and eligible Employees
in another stock bonus/employee stock ownership plan and trust qualified under
Code Sections 401, 409, 4975(e)(7) and 501. Otherwise, the termination
provisions of the Plan and Trust shall apply.



ARTICLE XVI



AMENDMENT OF THE PLAN



     16.01 Authority to Amend. The Sponsoring Company reserves the right to
amend the Plan with respect to all Employers at any time and from time to time
provided that a copy of any such amendment is delivered to all other Employers
within thirty (30) days of the adoption of the amendment. Each Employer may
amend the Plan with respect to such Employer at any time, and from time to
time, provided the Sponsoring Company approves such amendment. No


60






 


amendment shall permit any part of the Trust Fund to revert to or be
recoverable by an Employer or be used for or diverted to purposes other than
the exclusive benefit of the Participants or their Beneficiaries, or deprive
any Participant of any interest he might have in the Trust Fund at the time of
the amendment to the extent that such interest would be available to the
Participant under Article X hereof were he to voluntarily resign as of the
effective date of the amendment.


     16.02 Trustee’s Consent. Under no condition, shall such amendment,
amendments, or restatements increase the duties or responsibilities, or
decrease the compensation, privileges, and immunities of the Trustee without
the Trustee’s written consent.


     16.03 Limitations of Vesting Changes. Under no condition, shall such
amendment change the vesting schedule to one which would result in the
nonforfeitable percentage of the accrued benefit derived from Company
Contributions and Company Matching Contributions (determined as of the later of
the date of the adoption of the amendment or of the effective date of the
amendment) of any Participant being less than such nonforfeitable percentage
computed under the Plan without regard to such amendment; no amendment shall
change the vesting schedule unless each Participant with three (3) or more
Eligibility Years of Service as of the expiration date of the election period
described below, is permitted to elect, within the election period described
below, to have his nonforfeitable percentage computed under the Plan without
regard to the amendment. The election period described herein shall begin no
later than the date upon which the amendment is adopted and shall end no later
than the latest of the following dates: (i) the date which is sixty (60) days
after the day the amendment is adopted, (ii) the date which is sixty (60) days
after the day the amendment becomes effective, or (iii) the date which is sixty
(60) days after the day the Participant is issued a written notice of the
amendment by the Sponsoring Company.


     16.04 Limitations on Other Changes. Subject to the above stated
limitations and the requirement that no amendment shall eliminate, except with
respect to any future contributions or future accrual of benefits, any
nondiscretionary optional form of payment (as provided in Treasury Regulation
Section 1.411(d)-4, and Treasury Regulation Section 1.401(a)(4)-4(d) and Code
Section 411(d)(6)) with respect to any Participant who is a Participant
immediately prior to the amendment, the Sponsoring Company shall have the power
to amend the Plan and Trust Agreement, retroactively or otherwise, in any
manner in which it deems desirable, including, but not by way of limitation,
the power to change any provisions relating to the administration of the Plan
and Trust Fund, and to change any provisions relating to the benefits or
payment of any of the assets of the Trust Fund. Each such amendment shall
become effective when executed by the Sponsoring Company unless a different
effective date is specified in the amendment.


     16.05 Statutorily Required Amendments. Notwithstanding anything herein
to the contrary, this Plan may be amended at any time by the Sponsoring Company
if necessary or desirable in order to have it conform to the provisions and
requirements of the Code or any federal statute with respect to qualified
employees’ plans and trusts, and no such amendment shall be considered
prejudicial to the rights of any Participant hereunder or of any Beneficiary,
Alternate Payee or Employee. Further, it is understood that any provisions of
this Plan as herein contained which are contrary to the requirements of the
Code for a qualified tax exempt employees’ plan and trust shall be deemed void
and of no effect, without affecting the validity of other provisions hereof.


61






 


ARTICLE XVII



PERMANENCY OF THE PLAN



     17.01 Right to Terminate Plan. Each Employer contemplates that the Plan
shall be permanent and that it shall be able to make contributions to the Plan.
Nevertheless, in recognition of the fact that future conditions and
circumstances cannot now be entirely foreseen, the Sponsoring Company reserves
the right to terminate the Plan and each Employer reserves the right to
terminate the Plan as to such Employer.


     17.02 Merger or Consolidation of Plan and Trust. Neither the Plan nor
the Trust may be merged or consolidated with, nor may its assets or liabilities
be transferred to, any other plan or trust, unless each Participant would (if
the Plan then terminated) receive a benefit immediately after the merger,
consolidation, or transfer which is equal to or greater than the benefit he
would have been entitled to receive immediately before the merger,
consolidation, or transfer (if the Plan had then terminated).


     17.03 Continuance by Successor Company. In the event of the liquidation,
dissolution, merger, consolidation or reorganization of an Employer, the
successor company may adopt the Plan and Trust for the benefit of the Employees
of such Employer. If such successor company does adopt the Plan and Trust, it
shall, in all respects, be substituted for such Employer under the Plan and
Trust. Any such substitution of such successor company shall constitute an
assumption of Plan liabilities by such successor company, and such successor
company shall have all of the powers, duties and responsibilities of such
Employer under the Plan and Trust. If such successor company does not adopt
the Plan and Trust, the Plan and Trust shall be terminated with respect to such
Employer in accordance with the provisions of the Plan and Trust Agreement.


ARTICLE XVIII



DISCONTINUANCE OF CONTRIBUTIONS AND TERMINATION



     18.01 Suspension of Contributions. Should an Employer fail for any
reason to make Company Contributions and/or Company Matching Contributions in
any one (1) or more years, such failure shall not, of itself, terminate or
discontinue this Plan and Trust as to the Employer and its Participants, nor
shall the Employer incur any obligation to make up such Company Contributions
and/or Company Matching Contributions in whole or in part.


     18.02 Discontinuance of Contributions. Whenever an Employer determines
that it is impossible or inadvisable for it to make further Company
Contributions and/or Company Matching Contributions, such Employer may, without
terminating the Trust, permanently discontinue all further Company
Contributions and/or Company Matching Contributions by such Employer. A
certified copy of such Employer’s resolution or other formal written instrument
pursuant to Section 21.07 hereof, shall be delivered to the Committee and the
Trustee. Thereafter, the Committee and the Trustee shall continue to
administer all the provisions of the Plan which are necessary and remain in
force, other than the provisions relating to Company Contributions and/or
Company Matching Contributions by such Employer. Unless otherwise provided by
such resolutions, the Trust shall remain in existence ( with respect to such
Employer and all of the provisions of the Trust Agreement shall remain in
force.


62






 


     18.03 Termination of Plan and Trust. If an Employer determines to
terminate (as to such Employer) the Plan and Trust completely, they shall be
terminated insofar as they are applicable to such Employer as of the date
specified in certified copies of resolutions or other formal written instrument
pursuant to Section 21.07 hereof, delivered to the Committee and the Trustee.
Upon such termination of the Plan and Trust and before liquidation of the
Trust, the Committee shall require a special valuation of the Trust, if the
liquidation is not to occur as of a Valuation Date. After payment of all
expenses and proportional adjustment of Accounts of Participants with respect
to such Employer to reflect such expenses, Trust Fund profits or losses, and
subject to the limitations contained in Section 5.04 hereof, allocations of any
previously unallocated funds to the date of termination, such Employer’s
Participants shall be entitled to receive the amount then credited to their
respective Accounts in the Trust Fund in a lump-sum payment. If, in the
opinion of the Committee, assets in the Trust Fund or certain of them may
possibly not be readily salable (i) because of federal or state securities
laws, or the rules and regulations thereunder, or (ii) at their fair market
value, the Committee may direct and the Trustee shall effect, a distribution of
such assets in kind. If the entire Plan is terminating, upon completion of
liquidation and distribution of the assets of the Trust to the Participants as
provided for herein, the Trustee shall thereby complete the Trustee’s duties,
and the Trust shall terminate.


     18.04 Participant’s Rights to Benefits upon Termination or Partial
Termination of Plan or Complete Discontinuance of Contributions. Upon the
termination or partial termination (as determined by the Internal Revenue
Service) of the Plan or the complete discontinuance of Company Contributions
and Company Matching Contributions by an Employer, the rights of each such
Employer’s Employees who are then Participants (or, in the case of a partial
termination, who are then Participants affected by the partial termination) and
the rights of each other person to the amounts credited to his Accounts at such
time shall be nonforfeitable without reference to any formal action on the part
of such Employer, the Committee or the Trustee.


ARTICLE XIX



EXCLUSIVE BENEFIT OF THE PLAN



     19.01 Limitation on Reversions. Except as otherwise provided in this
Article XIX, it shall be impossible, at any time, for any part of the Trust
Fund, other than such part as is required to pay taxes and administration
expenses or such part as may otherwise be permitted by law to be returned to
the Employer, to be recoverable by an Employer, or to be used for, or diverted
to, purposes other than for the exclusive benefit of the Participants,
Beneficiaries and Alternate Payees.


     19.02 Unallocated Amounts upon Termination of Plan and Trust. In the
event the Plan and Trust are terminated, any previously unallocated amounts
maintained in the suspense account in accordance with the provisions of Section
5.04 hereof which cannot be allocated to Participants upon the termination of
the Plan and Trust pursuant to Section 18.03 hereof because of the limitations
contained in Sections 5.04 through 5.07 hereof, shall revert to the Employer or
Employers employing the Participant at the time of such termination.


     19.03 Mistake of Fact or Disallowance of Deduction. If the Committee in
good faith determines that (a) a Company Contribution or Company Matching
Contribution or Elective


63






 


Contribution, or all of them was made by reason of a mistake of fact, or
(b) a Company Contribution or Company Matching Contribution or Elective
Contribution, or all of them is conditioned on its being deductible under Code
Section 404, but the Internal Revenue Service disallows such deduction, the
Trustee shall, upon direction of the Committee, return the amount of the excess
Company Contribution or Company Matching Contribution or Elective Contribution,
or all of them to the contributing Employer. All payments of returned Company
Contributions or Company Matching Contributions or Elective Contribution, or
all of them under this Section shall be made within one (1) year from the date
of the payment of such mistaken Company Contribution or Company Matching
Contribution or Elective Contribution, or all of them or the disallowance by
the Internal Revenue Service of the deduction, whichever is applicable. The
amount of the excess Company Contribution or Company Matching Contribution or
Elective Contribution, or all of them shall be the excess of (1) the amount
contributed over (2) the amount that would have been contributed had there not
occurred a mistake of fact or had the deduction not been disallowed. Earnings
attributable to the excess Company Contribution or Company Matching
Contribution or Elective Contribution, or all of them shall not be returned to
the contributing Employer, but losses attributable thereto shall reduce the
amount of such Company Contribution or Company Matching Contribution or
Elective Contribution, or all of them to be so returned. Furthermore, if the
withdrawal of the amount attributable to the mistaken Company Contribution or
Company Matching Contribution or Elective Contribution, or all of them would
cause the balance of a Participant’s Account to be reduced to an amount which
is less than the balance which would have been in said Account had the mistaken
amount not been contributed, then the amount to be returned to the Employer
under this Section will be reduced so as to avoid any such reduction.


     19.04 Failure of Qualification of Plan and Trust. The initial
establishment of the Plan and Trust by any Employer is contingent upon
obtaining the approval of the Internal Revenue Service. In the event that the
Internal Revenue Service fails initially to approve the Plan and Trust as to
any Employer and the application for determination of the initial qualification
of the Plan was made within the time prescribed by law for filing the
Employer’s Federal income tax return for the taxable year in which the Plan was
adopted, or such later date as the Secretary of the Treasury may prescribe, the
Trustee shall, after paying any expenses attributable to such initial
establishment, return to such Employer any remaining Company Contribution or
Company Matching Contribution made by such Employer. Such remaining Company
Contribution or Company Matching Contribution shall be returned as promptly as
practicable, but in no event later than one (1) year after the date of the
final denial of qualification of the Plan as to such Employer, including the
final resolution of any appeals before the Internal Revenue Service or the
courts.


64






 


ARTICLE XX



TOP HEAVY PLAN RULES



     The Top Heavy rules under Code Section 416 ceased to apply to this Plan
effective September 1, 1998, the first day of the first Plan Year in which the
Plan no longer benefited any non-collectively bargained employees.


ARTICLE XXI



ESOP EXEMPT LOAN PROVISIONS



     21.01 Effect of Article. The following provisions of this Article XXI
and the appropriate provisions of the Trust Agreement shall apply
notwithstanding any other provisions of the Plan or the Trust Agreement to the
contrary, in the event the Trustee executes a Promissory Note for an exempt
loan to the Trust as defined in the regulations under Section 4975(e)(7) of the
Code.


     21.02 Definitions. For purposes of this Article XXI, the following terms
shall have the following meanings:


          21.02(1) “Promissory Note” shall mean each purchase money obligation
executed by the Trustee for the purpose of acquiring shares of Company Stock
(i) from a “disqualified person” within the meaning of Code Section 4975 or a
“party in interest” within the meaning of Section 3(14) of ERISA or (ii) from
any other person if the purchase money obligation payable to such other person
is guaranteed by a “disqualified person” or a “party in interest.” Shares of
Company Stock acquired with each Promissory Note shall be held in separate
Suspense Accounts. The terms of each Promissory Note and any security
agreements executed by the Trustee in connection therewith shall be subject to
the provisions set forth in the Trust Agreement.



          21.02(2) “Suspense Account” shall mean the record maintained by the
Committee pursuant to Section 21.04 of shares of Company Stock which have been
acquired by the Trustee with a Promissory Note and which have not been
allocated to the Accounts of Participants.



     21.03 Company Contributions. Notwithstanding the provisions of Section
4.01 hereof, subject to the limitations contained in Section 404(a) of the Code
including the carryover provisions thereof, each Employer shall make a Company
Contribution for each Plan Year in which a Promissory Note is outstanding in an
amount which shall not be less than the amount required to be paid under each
Promissory Note for such Plan Year. In no event will Elective Contributions be
used to repay any exempt loan.


65






 


     21.04 Release of Shares from Suspense Accounts.


          21.04(1) General.



                    (a) The Committee shall establish a separate Suspense Account for shares
of Company Stock acquired with each Promissory Note. The earnings, including
cash dividends paid on the allocated and unallocated shares of Company Stock
acquired with indebtedness represented by a Promissory Note shall be accounted
for separately from other assets of the Trust Fund and shall be used to pay
interest and/or principal on the Promissory Note until the Promissory Note has
been retired. For purposes of allocating to Participants’ Company Contribution
Accounts shares released from a Suspense Account by reason of the payment of
principal and/or interest with earnings on such Company Stock, such earnings
shall be deemed to have been allocated first to Participants’ Company
Contribution Accounts pursuant to Section 6.04 and then charged to such
Accounts in the manner provided in Section 21.04(2).



                    (b) As of each Valuation Date there shall be released from the applicable
Suspense Account for allocation to Participants’ Company Contribution Accounts
in the manner specified in Section 21.04(2) below a number of shares of Company
Stock equal to the number of shares of Company Stock in such Suspense Account
on such Valuation Date multiplied by a fraction, the numerator of which shall
be the amount of principal and interest payments under the terms of the
applicable Promissory Note made since the previous Valuation Date, and the
denominator of which shall be the sum of (1) the numerator and (2) the
remaining principal and interest to be paid under such Promissory Note for the
current Plan Year and all future Plan Years, without regard to any possible
extension or renewal periods of such Promissory Note. If the interest rate
under a Promissory Note is variable, the calculation of the remaining interest
to be paid in future Plan Years for the denominator of the fraction described
above shall be based on the interest rate in effect under such Promissory Note
on the Valuation Date with respect to which the fraction is applied. The
interest of each Participant in Company Stock released from a Suspense Account
shall be allocated to his Company Contribution Account in shares of such
Company Stock.



          21.04(2) Charges and Credits to Company Contribution Accounts. Each
Participant’s Company Contribution Account shall be charged with the
Participant’s share of any cash or property allocated to his Company
Contribution Account which is used by the Trustee to release shares of Company
Stock from the Suspense Account in the manner described in Section 21.04(1)
above, and the shares of Company Stock so purchased or released shall be
allocated to the Participant’s Company Contribution Account to the extent that
such Account has been so charged.



          21.04(3) Prohibited Allocations. No portion of the assets of the Plan
attributable to Company Stock acquired by the Plan in a sale to which Code
Section 1042 applies may accrue to or be allocated, directly or indirectly,
under any plan of the Sponsoring Company (or any Affiliated Company) meeting
the requirements of Code Section 401(a), during the “non-allocation period,”
for the benefit of: (i) any Participant who makes an election under Code
Section 1042(a) with respect to Company Stock; or (ii) any individual who is
related to such a Participant within the meaning of Code Section 267(b); or
(iii) for the benefit of any other person who owns (after application of Code
Section 318(a)) more than (x) 25% of any class of



66






 





outstanding stock of the corporation which issued the Company Stock or of
any corporation which is a member of the same controlled group of corporations
(within the meaning of Code Section 409(l)(4)) as such corporation, or (y) 25%
of the total value of outstanding stock of any such corporation. The
“non-allocation period” shall be the period beginning on the date of the sale
of the Company Stock and ending on the later of (i) the date which is 10 (ten)
years after the sale of Company Stock; or (ii) the date of allocation
attributable to the final payment under the Promissory Note incurred in
connection with such sale. The Trustee may establish subaccounts that it deems
necessary in order to comply with the provisions of this Section 21.04(3).


     21.05 Limitations on Annual Additions. Notwithstanding the provisions of
Section 5.04, if no more than one-third (1/3) of the Company Contributions to
the Plan for a Plan Year are allocated to accounts of Highly Compensated
Employees, the following amounts shall be excluded in determining the Annual
Addition of each Participant for such Plan Year: (i) Forfeitures of Company
Stock acquired with the proceeds of a Promissory Note, (ii) Company
Contributions to the Plan which are used to pay the interest on a Promissory
Note and which are deductible under Code Section 404(a)(9)(B) and which are
charged against the Participant’s Company Contribution Account.


     21.06 Determination of Net Earnings and Adjustments in Value. For
purposes of Section 6.04, the share of net income or net loss of the Trust Fund
allocable to the Company Contribution Accounts of Participants shall not
include any unrealized increase or decrease in the fair market value of Company
Stock held in a Suspense Account.


     21.07 Voting of Company Stock. For all purposes of Section 14.06, the
shares of Company Stock allocated to an active Participant’s Company
Contribution Account (not including inactive Participants) shall be treated as
including a portion of the unallocated shares of Company Stock held in a
Suspense Account; for this purpose the unallocated shares shall be considered
allocated to active Participants’ Company Contribution Accounts by assuming
that all such unallocated shares of Company Stock had been allocated to active
Participants in the Plan as of a date selected by the Committee, based upon
such active Participants’ comparative Company Stock account balances (i.e.,
Company Stock in an active Participant’s Company Contribution Account as a
percentage of all Company Stock in the Company Contribution Accounts of all
active Participants).


     21.08 Tender Offer on Company Stock. With respect to unallocated shares
of Company Stock, for purposes of Section 14.06, rights to tender in connection
with an Offer shall be exercised at the discretion of the Participants by
assuming that all such shares of Company Stock had been allocated to active
Participants (not including former Participants) in the Plan as of a date
selected by the Committee, based upon such Participants’ comparative Company
Stock account balances (i.e., Company Stock in an active Participant’s Company
Contribution Account as a percentage of all Company Stock in the Company
Contribution Accounts of all active Participants), and by permitting the
respective Participants to exercise tender rights as if such shares had been
finally and completely allocated to such Participants’ Accounts. Funds or
property received in exchange for tendered stock constituting unallocated
shares of Company Stock shall be credited to the Suspense Account.


67






 


     21.09 Forfeiture of Accounts. If a portion of a Participant’s Company
Contribution Account is forfeited, Company Stock allocated to such Account
shall be forfeited only after all other assets in such Account. If interests
in more than one class of Company Stock have been allocated to the
Participant’s Company Contribution Account, the Participant shall be treated as
forfeiting the same proportion of each such class.


     21.10 Distribution of Benefits.


          21.10(1) Notwithstanding the provisions of the fourth sentence of
Subsection 11.01(1) hereof to the contrary, a distribution of a Participant’s
Accounts under said fourth sentence shall not include Company Stock allocated
to an Account which was acquired with the proceeds of a Promissory Note until
the end of the Plan Year in which any acquisition indebtedness related to such
Company Stock is repaid in full, including any refinancings which are permitted
to be treated as acquisition indebtedness in accordance with rules prescribed
by the Secretary of the Treasury.



          21.10(2) If interests in more than one class of Company Stock have been
allocated to the Participant’s Company Contribution Account, each distribution
to the Participant shall be made in substantially the same proportion of each
such class.



     21.11 Further Conditions. Except as otherwise provided in Section 12.03
and Section 22.08, shares of Company Stock acquired with a Promissory Note
shall not be subject to any other put, call, or other option, or buy-sell or
similar arrangement while held under the Plan or when distributed from the Plan
to a Participant or Beneficiary, whether or not the Plan then constitutes an
“employee stock ownership plan” within the meaning of Section 4975(e)(7) of the
Code. In addition, the provisions of the preceding sentence and of Section
22.08 shall continue to apply to shares of Company Stock acquired with a
Promissory Note after the Promissory Note has been satisfied and after the Plan
ceases to constitute an “employee stock ownership plan” as described above.


ARTICLE XXII



MISCELLANEOUS



     22.01 Effect of Bankruptcy and Other Contingencies Affecting an Employer.
Neither the bankruptcy, receivership, insolvency, liquidation, dissolution,
merger, consolidation or reorganization of an Employer, or any other
eventuality affecting the Employer, shall terminate the Trust or render
ineffectual this Plan or discharge any Employer from any liabilities to the
Trust for which it shall already have become obligated, but the same shall
continue in full force and effect as though such eventuality had not occurred;
however, the Committee shall in such event be authorized hereby to make any and
all rules and regulations not inconsistent with the purposes of the Plan as
shall be necessary to deal with such change in the situation of the Plan and
Trust.


     22.02 Benefits Payable by Trust. All benefits payable under the Plan
shall be paid or provided for solely from the Trust Fund. No Employer assumes
any liability or responsibility therefor.


68






 


     22.03 Withholding. The Committee shall determine whether or not federal
income tax withholding is required with respect to any distribution or
withdrawal hereunder, shall direct the Trustee to withhold any amounts required
by law to be withheld, and shall furnish the Trustee with any information
required by Treasury regulations regarding withholding. Notwithstanding any
other provision of this Plan to the contrary, all rights and benefits of a
Participant, Beneficiary or Alternate Payee are subject to withholding of any
tax required by law to be withheld.


     22.04 Interpretation of the Plan and Trust. It is the intention of the
Employers that the Plan, and the Trust established by the Employers to
implement the Plan, shall be an employee stock ownership plan and trust, with a
cash or deferred arrangement feature and shall comply with the provisions of
Code Sections 401, 409, 4975(e)(7) and 501 and the requirements of ERISA, and
the corresponding provisions of any subsequent laws, and the provisions of the
Plan and Trust Agreement shall be construed to effectuate such intention.


     22.05 Provisions Hereof for Sole Benefit of Parties Hereto and
Participants. All of the covenants, stipulations and agreements contained in
this Plan are and shall be for the sole and exclusive benefit of and binding
upon the parties hereto, their successors and assigns, and the Participants and
their Beneficiaries.


     22.06 Article and Section Headings. The titles or headings of the
respective Articles and Sections in this Plan are inserted merely for
convenience and shall be given no legal effect.


     22.07 Formal Action by Employer. Any formal action herein permitted or
required to be taken by an Employer shall be:


                    (a) if and when a partnership, by written instrument executed by one or
more of its general partners or by written instrument executed by a person or
group of persons who has been authorized by written instrument executed by one
or more general partners as having authority to take such action;



                    (b) if and when a proprietorship, by written instrument executed by the
proprietor or by written instrument executed by a person or group of persons
who has been authorized by written instrument executed by the proprietor as
having authority to take such action;



                    (c) if and when a corporation, by resolution of its board of directors or
other governing board, or by written instrument executed by a person or group
of persons who has been authorized by resolution of its board of directors or
other governing board as having authority to take such action; or



                    (d) if and when a joint venture, by written instrument executed by one of
the joint venturers or by written instrument executed by a person or group of
persons who has been authorized by written instrument executed by one of the
joint venturers as having authority to take such action.



69






 





     22.08 Right to Require Repurchase of Shares of Company Stock.


          22.08(1) Subject to the following provisions of this Section 22.08, if at
the time of distribution hereunder the shares of Company Stock distributed from
the Trust Fund to a Participant or his Beneficiary with respect to a Plan Year
are not publicly traded or are subject to a trading limitation (as hereafter
defined), the former Participant or Beneficiary shall have an option (the
“Put”) to require the Sponsoring Company to purchase all shares of Company
Stock distributed from the Trust Fund to the former Participant or Beneficiary
for such Plan Year. For purposes of the preceding sentence, a “trading
limitation” is a restriction under any federal or state securities law, or any
regulation thereunder, or an agreement, which would make the shares of Company
Stock not as freely tradable as shares of Company Stock not subject to such
restriction.



          22.08(2) The Put may be exercised at any time during the Option Period
(as hereinafter defined) by giving the Sponsoring Company written notice of the
election to exercise the Put. The Option Price (as hereinafter defined) shall
be payable in cash and/or in installments (as provided below) beginning not
later than 30 days after the Sponsoring Company receives written notice of the
election by the former Participant or Beneficiary to exercise the Put. The Put
may be exercised by a former Participant or the Beneficiary only during the
Option Period relating to a distribution of shares of Company Stock under
Section 11.01 to the former Participant or Beneficiary.



          22.08(3) The “Option Period” shall be the sixty (60) day period following
the day on which a Participant or his Beneficiary receives a distribution of
shares of Common Stock under Section 11.01; if the Put is not exercised within
this first sixty (60) day period, it may be exercised during a second “Option
Period” which shall be a sixty (60) day period beginning on the first day of
the third month of the Plan Year which follows the Plan Year of distribution of
such shares of Common Stock. Notwithstanding the foregoing, the Option Period
shall be extended by the amount of time during which the Sponsoring Company is
unable to honor the Put by reason of applicable federal or state law.



          22.08(4) The “Option Price” shall be the fair market value as determined
pursuant to Treasury Regulations Section 54.4975-11(d)(5) (or, in the case of
any shares of Company Stock that are not readily tradable on an established
securities market, as determined by an independent appraiser meeting
requirements similar to the requirements of the Treasury Regulations under
Section 170(a)(1) of the Code) of each share of Company Stock as determined by
the Sponsoring Company as of the Valuation Date immediately preceding the date
the Put is exercised, multiplied by the number of shares to be sold under the
Put. Notwithstanding the provisions of this paragraph, the Option Price shall
be determined on the date the Put is exercised if the transaction involves a
“disqualified person” within the meaning of Code Section 4975.



          22.08(5) Payment of the Option Price for shares of Company Stock subject
to the Put shall be made either in a lump sum or in installments as determined
by the Sponsoring Company. In the event payments are made in installments, the
installment obligation shall (1) be adequately secured as determined by the
Sponsoring Company, (2) bear a reasonable rate of interest as determined by the
Sponsoring Company on a uniform and nondiscriminatory basis, but in no event
shall such rate of interest be greater than the maximum non-usurious rate of



70






 





interest permitted to be charged on such indebtedness under Texas law, (3)
require that the payments be made in annual installments, (4) have a payment
period of five (5) years from the date the Put is exercised, (5) require that
any payments pursuant to the installment obligation must begin to be made no
later than thirty (30) days after the date the Put is exercised, and (6) permit
the Sponsoring Company to prepay the amount of any remaining installments
without penalty.


          22.08(6) The Put granted to a former Participant or Beneficiary hereunder
shall not be assignable, except that the former Participant’s donees or, in the
event of a Participant’s death, his personal representative shall be entitled
to exercise the Put during the Option Period for which it is applicable.



          22.08(7) The Committee shall notify each former Participant or
Beneficiary who is eligible to exercise the Put of the fair market value of
each share of Company Stock for the Valuation Date next following the date the
Participant receives a distribution as soon as practicable following such
determination.



          22.08(8) The Committee and the Sponsoring Company shall send all notices
required under this Section to the last known address of a former Participant
or Beneficiary, and it shall be the duty of such persons to inform the
Committee of any changes in address.



          22.08(9) The Trustee in its discretion may, with the Sponsoring Company’s
consent, assume the Sponsoring Company’s obligation under this Section at the
time a former Participant or Beneficiary exercises the Put. If the Trustee
does assume the Sponsoring Company’s obligations, the foregoing provisions of
this Section that apply to the Sponsoring Company shall also apply to the
Trustee.



          22.08(10) The Put provided for in this Section shall also apply to shares
of Company Stock that are publicly traded without restriction when distributed
but which cease to be publicly traded or which become subject to a trading
limitation during the Option Period. In such event, the Committee shall notify
in writing each former Participant or Beneficiary to whom the Put becomes
applicable that the shares of Company Stock held by the former Participant or
Beneficiary are subject to the Put for the remainder of such Option Period and
shall inform the Participant or Beneficiary of the terms of the Put. If
written notice is given pursuant to this Section later than ten days after the
shares of Company Stock cease to be publicly traded or become subject to a
trading limitation, the period during which the Put may be exercised shall be
extended by the number of days between such tenth day and the date such notice
is actually given.



     22.09 Restrictions on Transfer of Company Stock.


          22.09(1) Federal Securities Laws. If the Sponsoring Company does not
register under the Securities Act of 1933 (the “1933 Act”) any shares of
Company Stock to be distributed to Participants or their Beneficiaries, such
shares of Company Stock distributed under the Plan may be “restricted
securities.” Restricted securities may not be sold unless they are registered
under the 1933 Act by the Sponsoring Company, or unless an exemption from
registration is available. If the Sponsoring Company does not register shares
of Company Stock for resale by Participants or their Beneficiaries, and if such
persons desire to sell the shares of Company Stock



71






 





distributed to them, they will be required to sell the shares of Company
Stock in transactions exempt from registration under the 1933 Act. The
Sponsoring Company will not permit shares of Company Stock to be transferred
unless it is satisfied that any proposed transfer of Company Stock is exempt
from the registration requirements of the 1933 Act.


          22.09(2) Other Restrictions. All transactions involving shares of
Company Stock, including distributions, purchases and sales, shall be made only
in compliance with applicable federal and state laws, regulations and rules.
All such transactions shall also be subject to all restrictions and limitations
imposed on all shares of Company Stock provided for in the Sponsoring Company’s
Articles of Incorporation and Bylaws as amended from time to time.



          22.09(3) Legends. The Sponsoring Company reserves the right to cause
appropriate legends to be imprinted on the certificates representing shares of
Company Stock distributed under this Plan to reflect all restrictions and
limitations referred to in this Section 22.09.



          22.09(4) Notices. The Committee and the Sponsoring Company shall send
all notices required with respect to shares of Company Stock to the last known
address of each Participant or Beneficiary who is required to receive notices
regarding such stock, and it shall be the duty of the Participant and
Beneficiary to inform the Committee of any changes in address.



     22.10 APPLICABLE LAW. THIS PLAN SHALL BE GOVERNED BY THE LAWS OF THE
STATE OF TEXAS TO THE EXTENT NOT PREEMPTED BY APPLICABLE FEDERAL LAW.


72






 


APPENDIX RELATED TO XCEL MERGER



Notwithstanding anything in this Plan to the contrary,



	A.	 	Commencing on the effective date (hereinafter, the “Merger
Date”), of the merger of New Century Energies, Inc. (hereinafter
“NCE”) and Northern States Power Company (hereinafter “NSP”) to form
Xcel Energy Inc. (hereinafter “Xcel”), the individuals who will be
eligible to accrue benefits under this Plan with respect to service
and compensation on or after the Merger Date are limited to the
following:




	 	(1)	 	Those persons who were accruing benefits under
this Plan (or who would have been eligible to accrue benefits
under this Plan if they had satisfied any applicable age
and/or service requirements) immediately prior to the Merger
Date.
	 
	 	(2)	 	Persons who are hired by Xcel or a subsidiary of
Xcel after the Merger Date in a position or job category that
was covered by this Plan immediately prior to the Merger Date
and whose principal place of employment is at a facility or
location that was owned and/or operated by NCE or an NCE
subsidiary and was covered by this Plan immediately prior to
the Merger Date.
	 
	 	(3)	 	Any person who was a participant in this Plan at
some time prior to the Merger Date, who had ceased to accrue
benefits under this Plan due to a termination of employment
prior to the Merger Date, who had not become a participant in
any qualified retirement plan sponsored by NSP or an NSP
subsidiary at any time after such termination of employment
and prior to the Merger Date, who was not employed by NCE, NSP
or any of their subsidiaries immediately prior to the Merger
Date, and who is rehired by Xcel or a subsidiary of Xcel after
the Merger Date.




	B.	 	For purposes of applying paragraph A. of this Appendix,




	 	(1)	 	Any individual (i) who was actively participating
in and accruing benefits under any qualified retirement plan
sponsored by NSP or an NSP subsidiary immediately prior to the
Merger Date (or who would have been participating in such an
NSP plan if he or she had satisfied any applicable age and/or
service requirements), or (ii) who became a participant in
such an NSP retirement plan after the Merger Date, shall not
be eligible to participate in or accrue benefits under this
Plan after the Merger Date, even if the individual
subsequently satisfies the requirements of paragraph A. The
previous sentence also applies to any individual who was a
participant in such an NSP retirement plan at some time prior
to the Merger Date, who had ceased to accrue benefits under
such NSP retirement plan due to a termination of employment
prior to the Merger



73






 





	 	 	 	date, who had not become a participant in this Plan at any
time after such termination of employment and prior to the
Merger Date, who was not employed by NCE, NSP or any of their
subsidiaries immediately prior to the Merger Date, and who is
rehired by Xcel or a subsidiary of Xcel after the Merger
Date.
	 
	 	(2)	 	Any individual (other than an individual
described in paragraph B(1), above) who (i) has satisfied the
requirements of paragraph A(1), A(2) or A(3), and (ii) is
subsequently transferred to the employ of an Xcel subsidiary
that is not a participating employer in this Plan, or to an
Xcel facility or location that was not owned and/or operated
by NCE or an NCE subsidiary immediately prior to the Merger
Date, will nevertheless continue to participate in this Plan
following the transfer. An Xcel subsidiary that is not
otherwise a participating employer in this Plan, but that
employs one or more transferred participants described in this
paragraph B(2) following the transfer, shall be deemed to be a
participating employer in this Plan solely with respect to
such transferred participants.
	 
	 	(3)	 	Notwithstanding paragraph B(2), if an individual
described in that paragraph is employed following the transfer
in a collective bargaining unit that is not covered by this
Plan, paragraph B(2) shall not apply, the individual shall
cease to actively participate in and accrue benefits under
this Plan following the transfer, and the individual shall
become eligible to participate following the transfer in any
qualified retirement plan that covers that collective
bargaining unit pursuant to the terms of such plan. The
previous sentence shall also apply to any individual who is
rehired by Xcel or a subsidiary of Xcel after the Merger Date
in a collective bargaining unit that is not covered by this
Plan, notwithstanding anything in this Appendix to the
contrary.
	 
	 	(4)	 	If an individual (other than an individual
described in paragraph B(1)) who meets the requirements of
paragraph A(1), A(2) or A(3) is subsequently transferred from
a position or job category that was covered by this Plan prior
to the Merger Date to a position or job category that was
covered prior to the Merger Date by another qualified
retirement plan of the same type (i.e. defined benefit or
defined contribution) that was sponsored by NCE prior to the
Merger Date, or if an individual covered by such other NCE
plan at any time following the Merger Date is subsequently
transferred to a position or job category covered by this
Plan, the individual’s participation in this Plan or the other
NCE Plan following the transfer shall be determined pursuant
to the provisions of the applicable NCE plans in effect
immediately prior to the Merger Date.




	C.	 	If an individual who does not satisfy the requirements of
paragraph A(1), A(2) or A(3) remains entitled to a benefit under
this Plan that accrued prior to the Merger Date, such benefit shall
continue to be held under the provisions of this Plan in



74






 







	 	 	effect at the applicable times prior to the Merger Date for
distribution pursuant to such provisions following the termination
of the individual’s employment with Xcel and the subsidiaries of
Xcel (or the occurrence of any other event that permits
distribution of such benefit).



75