As filed
with the Securities and Exchange Commission on November 21, 2008
File
No. -
United
States
Securities
and Exchange Commission
Washington,
D.C. 20549
____________________
FORM
S-8
REGISTRATION
STATEMENT
UNDER
THE
SECURITIES ACT OF 1933
SOUTHWEST
GAS CORPORATION
(Exact
name of Registrant as specified in its charter)
|
California
(State
or other jurisdiction of
incorporation
or organization)
5241
Spring Mountain Road
P.O.
Box 98510
Las
Vegas, Nevada
(Address
of principal executive offices)
|
88-0085720
(I.R.S.
Employer
Identification
Number)
89193-8510
(Zip
Code)
|
|
SOUTHWEST
GAS CORPORATION EMPLOYEES' INVESTMENT PLAN
(Full
title of the plan)
GEORGE
C. BIEHL
Executive
Vice President, Chief Financial Officer and Corporate Secretary
Southwest
Gas Corporation
5241
Spring Mountain Road
P.O.
Box 98510
Las
Vegas, Nevada 89193-8510
(Name and
address of agent for service)
(702)
876-7237
(Telephone
number, including area code, of agent for service)
CALCULATION
OF REGISTRATION FEE
|
Title
of securities being registered
|
Amount
to
be
registered
(1)
|
Proposed
maximum
offering
price per
share
(2)
|
Proposed
maximum
aggregate
offering
price (2)
|
Amount
of
registration
fee
|
|
Common
Stock ($1 par value) ......
|
1,000,000
shares
|
$24.63
|
$24,630,000
|
$967.96
|
|
(1)
|
In
addition, pursuant to Rule 416(c) under the Securities Act of 1933, this
Registration Statement also covers an indeterminate amount of interests to
be offered or sold pursuant to the Plan described
herein.
|
|
(2)
|
Pursuant
to Rule 457(h), the maximum offering price, per share and in the
aggregate, and the registration fee were calculated based upon the average
of the high and low prices of the Common Stock on the New York Stock
Exchange on November 19, 2008 of
$24.63.
|
As
permitted by Rule 429, the Prospectus with respect to this Registration
Statement also relates to Registrant's Registration Statement on Form S-8
(333-145783).
PART
I
INFORMATION
REQUIRED IN THE SECTION 10(A) PROSPECTUS
|
Item
1.
|
Plan
Information*
|
|
Item
2.
|
Registrant
Information and Employee Plan Annual
Information*
|
|
|
*
|
Information
required by Part I to be contained in the Section 10(a) prospectus is
omitted from the Registration Statement in accordance with Rule 428 under
the Securities Act of 1933 and the Note to Part I of Form
S-8.
|
PART
II
INFORMATION
REQUIRED IN THE REGISTRATION STATEMENT
|
Item
3.
|
Incorporation
of Certain Documents by Reference
|
The following documents of Southwest Gas Corporation (the “Company”) filed with
the Securities and Exchange Commission are incorporated herein by
reference:
|
|
(a)
|
Annual
Report on Form 10-K for the Company’s fiscal year ended December 31, 2007
and Employees' Investment Plan Annual Report on Form 11-K for the year
ended December 31, 2007.
|
|
|
(b)
|
Quarterly
Reports on Form 10-Q for the Company’s quarters ended March 31, 2008, June
30, 2008, and September 30, 2008.
|
|
|
(c)
|
Current
reports on Form 8-K dated February 26, 2008, February 28, 2008, March
14, 2008, May 7, 2008, July 29, 2008, September 16, 2008, September 24,
2008, and November 14, 2008.
|
|
|
(d)
|
Description
of the Company’s Common Stock contained in its Form 8-K dated July 22,
2003, and any amendment or report filed for the purpose of updating such
description.
|
All
documents subsequently filed by the Company pursuant to Sections 13(a), 13(c),
14 and 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”), prior to the filing of a post-effective amendment which indicates that
all securities offered have been sold or which deregisters all securities then
remaining unsold, shall be deemed to be incorporated by reference in this
Registration Statement and to be a part hereof from the date of filing of such
documents. Any statement contained herein or in a document, all or a
portion of which is incorporated or deemed to be incorporated by reference
herein, shall be deemed to be modified or superseded for purposes of this
Registration Statement to the extent that a statement contained herein or in any
other subsequently filed document which also is or is deemed to be incorporated
by reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or amended, to constitute a part of this Registration Statement.
Item
4. Description of Securities
The
Company’s Common Stock, $1.00 par value, (the “Common Stock”) is registered
pursuant to Section 12 of the Exchange Act, and, therefore, the description of
securities is omitted.
S-1
|
Item
5.
|
Interests
of Named Experts and Counsel
|
Robert M.
Johnson, Esq., as Assistant General Counsel for the Company, has given an
opinion to the Securities and Exchange Commission upon the validity of the
shares of Common Stock registered.
The
financial statements and management’s assessment of the effectiveness of
internal control over financial reporting (which is included in Management’s
Report on Internal Control over Financial Reporting) incorporated in this
Registration Statement by reference to the Annual Report on Form 10-K of
Southwest Gas Corporation for the year ended December 31, 2007 and the financial
statements incorporated in this Registration Statement by reference to the
Annual Report on Form 11-K of the Southwest Gas Corporation Employees’
Investment Plan for the year ended December 31, 2007 have been so incorporated
in reliance on the reports of PricewaterhouseCoopers LLP, an independent
registered public accounting firm, given on the authority of said firm as
experts in auditing and accounting.
|
Item
6.
|
Indemnification
of Directors and Officers
|
The
Company's Articles of Incorporation contain a provision which eliminates the
liability of directors for monetary damages to the fullest extent permissible
under California law. The General Corporation Law of California (the
"Law") (i) authorizes the elimination of liability of directors for monetary
damages in an action brought by a shareholder in the right of the Company or by
the Company for breach of a director's duties to the Company and its
shareholders and (ii) authorizes the Company to indemnify directors and
officers for monetary damages for all acts or omissions committed by them in
their respective capacities; provided, however, that liability is not limited
nor may indemnification be provided (a) for acts or omissions that involve
intentional misconduct or knowing and culpable violation of law, (b) for
acts or omissions that a director or officer believes to be contrary to the best
interests of the Company or its shareholders or that involve the absence of good
faith on the part of a director or officer seeking indemnification, (c) for
any transaction from which a director or officer derives an improper personal
benefit, (d) for acts or omissions that show a reckless disregard for the
director's or officer's duty to the Company or its shareholders in circumstances
in which such person was aware, or should have been aware, in the ordinary
course of performing his or her duties, of a risk of serious injury to the
Company or its shareholders, (e) for acts or omissions that constitute an
unexcused pattern of inattention that amounts to an abdication of the director's
or officer's duty to the Company or its shareholders, and (f) for
liabilities arising under Section 310 (contracts in which a director has a
material financial interest) and Section 316 (certain unlawful dividends,
distributions, loans and guarantees) of the Law. In addition, the
Company may not indemnify directors and officers in circumstances in which
indemnification is expressly prohibited by Section 317 of the
Law.
The
bylaws of the Company provide that the Company has the power to indemnify
directors and officers to the fullest extent permitted under California law and
the Company's Articles of Incorporation. The Company has entered into
indemnification agreements with its directors and officers which require that
the Company indemnify such directors and officers in all cases to the fullest
extent permitted by applicable provisions of the Law. The Company
also maintains a directors' and officers' liability insurance policy insuring
directors and officers of the Company for covered losses as defined in the
policy.
|
Item
7.
|
Exemption
from Registration Claimed
|
Not
applicable.
|
Item
8.
|
Exhibits
|
|
4.1
|
Employees’
Investment Plan
|
||
|
5.1
|
Opinion
of Counsel of Southwest Gas Corporation regarding legality of the
securities to be registered
|
||
|
23.1
|
Consent
of PricewaterhouseCoopers LLP
|
||
|
23.2
|
Consent
of Counsel of Southwest Gas Corporation (included in opinion filed as
Exhibit 5.1 to this Registration Statement)
|
||
|
24.1
|
Powers
of Attorney
|
S-2
Undertaking in lieu of
Exhibit:
The
Employees’ Investment Plan (the “Plan”) received a favorable determination
letter from the Internal Revenue Service on April 23, 2003. Since
that time, there have been various amendments to the Plan including those
required by the Internal Revenue Service (“IRS”). The Plan, as
amended, will be submitted to the IRS in a timely manner in order to continue
its qualification under Section 401 of the Internal Revenue Code.
|
Item
9.
|
Undertakings
|
The
undersigned Registrant hereby undertakes:
(1) To
file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) To include any prospectus required by
Section 10(a)(3) of the Securities Act of 1933, unless the information required
to be included in such post-effective amendment is contained in a periodic
report filed by Registrant pursuant to Section 13 or Section 15(d) of the
Exchange Act and incorporated herein by reference;
(ii) To
reflect in the prospectus any facts or events arising after the effective date
of the Registration Statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate, represent a fundamental change
in the information set forth in this Registration Statement, unless the
information required to be included in such post-effective amendment is
contained in a periodic report filed by Registrant pursuant to Section 13
or Section 15(d) of the Exchange Act and incorporated herein by
reference;
(iii) To include any material information
with respect to the plan of distribution not previously disclosed in this
Registration Statement or any material change to such information in this
Registration Statement;
(2) That,
for the purpose of determining any liability under the Securities Act of 1933,
each such post-effective amendment shall be deemed to be a new Registration
Statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(3) To
remove from registration by means of a post-effective amendment any of the
securities being registered which remain unsold at the termination of the
offering.
The
undersigned Registrant hereby further undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act of 1934 (and each filing of the annual report of the Plan pursuant
to Section 15(d) of the Exchange Act of 1934) that is incorporated by reference
in the Registration Statement shall be deemed to be a new Registration Statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
Insofar
as indemnification for liabilities arising under the Securities Act of 1933 may
be permitted to directors, officers and controlling persons of the Registrant
pursuant to the foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
S-3
SIGNATURES
Pursuant
to the requirements of the Securities Act of 1933, the Registrant certifies that
it has reasonable grounds to believe that it meets all of the requirements for
filing on Form S-8 and has duly caused this Registration Statement to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of Las
Vegas, State of Nevada, on November 21, 2008.
|
SOUTHWEST
GAS CORPORATION
|
||
|
By
|
/s/
GEORGE C. BIEHL
|
|
|
George
C. Biehl
|
||
|
Executive
Vice President, Chief Financial Officer and
|
||
|
Corporate
Secretary
|
SIGNATURES
Pursuant
to the requirements of the Securities Act of 1933, this Registration Statement
has been signed by the following persons in the capacities
indicated.
|
Signature
|
Title
|
Date
|
||
|
/s/
JEFFREY W. SHAW
|
Director
and
|
November
21, 2008
|
||
|
(Jeffrey
W. Shaw)
|
Chief
Executive Officer
|
|||
|
(Principal
Executive Officer)
|
||||
|
/s/
GEORGE C. BIEHL
|
Director,
Executive Vice President,
|
November
21, 2008
|
||
|
(George
C. Biehl)
|
Chief
Financial Officer and
|
|||
|
Corporate
Secretary
|
||||
|
(Principal
Financial Officer)
|
||||
|
/s/
ROY R. CENTRELLA
|
Vice
President, Controller and
|
November
21, 2008
|
||
|
(Roy
R. Centrella)
|
Chief
Accounting Officer
|
|||
|
(Principal
Accounting Officer)
|
||||
|
/s/
ROBERT L. BOUGHNER *
|
Director
|
November
21, 2008
|
||
|
(Robert
L. Boughner)
|
||||
|
/s/
THOMAS E. CHESTNUT *
|
Director
|
November
21, 2008
|
||
|
(Thomas
E. Chestnut)
|
||||
|
/s/
STEPHEN C. COMER *
|
Director
|
November
21, 2008
|
||
|
(Stephen
C. Comer)
|
||||
|
/s/
RICHARD M. GARDNER *
|
Director
|
November
21, 2008
|
||
|
(Richard
M. Gardner)
|
||||
|
/s/
JAMES J. KROPID *
|
Chairman
of the Board
|
November
21, 2008
|
||
|
(James
J. Kropid)
|
of
Directors
|
S-4
|
Signature
|
Title
|
Date
|
||
|
/s/
MICHAEL O. MAFFIE *
|
Director
|
November
21, 2008
|
||
|
(Michael
O. Maffie)
|
||||
|
/s/
ANNE L. MARIUCCI *
|
Director
|
November
21, 2008
|
||
|
(Anne
L. Mariucci)
|
||||
|
/s/
MICHAEL J. MELARKEY *
|
Director
|
November
21, 2008
|
||
|
(Michael
J. Melarkey)
|
||||
|
/s/
CAROLYN M. SPARKS *
|
Director
|
November
21, 2008
|
||
|
(Carolyn
M. Sparks)
|
||||
|
/s/
THOMAS A. THOMAS *
|
Director
|
November
21, 2008
|
||
|
(Thomas
A. Thomas)
|
||||
|
/s/
TERRENCE L. WRIGHT *
|
Director
|
November
21, 2008
|
||
|
(Terrence
L. Wright)
|
||||
|
* By /s/ GEORGE
C. BIEHL
|
||||
|
(George
C. Biehl)
|
||||
|
Attorney-in-fact
|
S-5
The
Plan
Pursuant
to the requirements of the Securities Act of 1933, the Southwest Gas Corporation
Benefits Committee has duly caused this Registration Statement to be signed on
its behalf by the undersigned, thereunto duly authorized, in the City of Las
Vegas, State of Nevada, on November 21, 2008.
|
SOUTHWEST
GAS CORPORATION
|
||
|
BENEFITS
COMMITTEE
|
||
|
/s/
JAMES P. KANE
|
||
|
(James
P. Kane)
|
||
|
/s/
GEORGE C. BIEHL
|
||
|
(George
C. Biehl)
|
||
|
/s/
KAREN S. HALLER
|
||
|
(Karen
S. Haller)
|
S-6
Exhibit
Index
|
Exhibit
|
||
|
Number
|
Description
|
|
|
4.1
|
Employees’
Investment Plan
|
|
|
5.1
|
Opinion
of Counsel of Southwest Gas Corporation regarding legality of the
securities to be registered
|
|
|
23.1
|
Consent
of PricewaterhouseCoopers LLP
|
|
|
23.2
|
Consent
of Counsel of Southwest Gas Corporation (included in opinion filed as
Exhibit 5.1 to this Registration Statement)
|
|
|
24.1
|
Powers
of Attorney
|
S-7
SOUTHWEST
GAS CORPORATION
EMPLOYEES'
INVESTMENT PLAN
Amended
and Restated -- Effective January 1, 1989
Amended
and Restated -- Effective December 1, 1994
Amended
and Restated -- Effective July 1, 1996
Amended
and Restated -- Effective October 1, 2001
Amended
and Restated -- Effective January 3, 2003
Amended
and Restated -- Effective March 28, 2005
Amended
and Restated -- Effective February 1, 2006
Amended
and Restated -- Effective January 1, 2006
Amended
and Restated -- Effective October 1, 2007
Amended
and Restated -- Effective January 1, 2008
Amended
and Restated -- Effective April 1, 2008
Amended
and Restated -- Effective July 1, 2008
Amended
and Restated -- Effective January 1, 2008
i
INTRODUCTION
The
Southwest Gas Corporation Employee's Investment Plan, as amended and restated
here, constitutes a continuation of the Plan as originally effective April 1,
1965. The Plan is a profit sharing plan with a cash or deferred
arrangement.
The
purposes of this Fourth Amendment are to amend and restate the terms of the Plan
to: (a) change the Plan’s eligibility rules; (b) change the Plan’s claims
procedures to comply with new ERISA claims procedure regulations; (c) cause the
Plan to adopt model amendment language out of Internal Revenue Service Notice
2000-18, dealing with Code Section 401(a)(9) regulations, and Notice 2001-37,
dealing with the definition of compensation and qualified transportation fringe
benefits; (d) make changes to the Plan so as to cause the Plan to comply with
changes made by the Uruguay Round Agreements, Pub. L. 103-465 (GATT); the
Uniformed Services Employment and Reemployment Rights Act of 1994) (USERRA); The
Small Business Job Protection Act of 1996, Pub. L. 104-188 (SBJPA) (including
Code Section 414(u); the Tax Payer Relief Act of 1997 (TRA’97); and The Internal
Revenue Service Restructuring and Reform Act of 1998 (RRA), (e) adopt changes to
the Plan to comply with the mandatory requirements and selected options
permitted by the Economic Growth and Tax Relief Reconciliation Act of 2001
(EGTRRA) and (f), effective as January 1, 2002, to designate the portion of the
Plan invested in Company Stock (consisting of (i) Company Matching Contributions
and (ii) Participant Deferrals), as an Employee Stock Ownership Plan (“ESOP”),
as defined in Code Section 4975.
As
amended, the Plan contains an ESOP which is designed to invest primarily in
qualifying employer securities. It is the intention of the Company
that (i) the non-ESOP portion of the Plan (the "Profit-Sharing Plan") shall be a
profit-sharing plan that is qualified under Code Sections 401(a) and 401(k),
(ii) the ESOP portion of the Plan shall be both a stock bonus plan and an
employee stock ownership plan that is qualified under Code Sections 401(a) and
4975(e)(7) and described in ERISA Section 407(d)(6), (iii) that the
Profit-Sharing Plan and the ESOP together shall constitute a single plan under
Treasury Regulation Section 1.414(1)-1(b)(1); (iv) that the Plan shall satisfy
the requirements of ERISA; and (v) that the Trust Fund maintained under the Plan
shall be tax-exempt under Code Section 501(a).
The
provisions in the other sections of the Plan shall apply to the ESOP in the same
fashion as they apply to the Profit Sharing Plan, except to the extent such
provisions are by their terms inapplicable to the ESOP. The amendment
of the Plan to include the ESOP shall not affect any beneficiary designation or
other applicable agreements, elections, or consents that Participants, spouses
or beneficiaries validly executed under the terms of the Plan before the January
1, 2002 effective date of the ESOP, and such designations, elections, and
consents shall be applied under the ESOP in the same manner as they applied
under the Plan before the addition of the ESOP.
This
restatement of the Plan shall be effective on October 1, 2001; provided,
however, that if a provision of this restatement of the Plan has a specific
effective date other than October 1, 2001, the date so specified shall be the
effective date of such provision.
ii
|
TABLE OF
CONTENTS
|
||||
|
ARTICLE
|
Page
|
|||
|
1.
|
DEFINITIONS
|
|||
|
Accounts
|
1
|
|||
|
Affiliated
Company
|
1
|
|||
|
Alternate
Payee
|
1
|
|||
|
Beneficiary
|
1
|
|||
|
Board
|
1
|
|||
|
Business
Day
|
1
|
|||
|
Code
|
2
|
|||
|
Committee
|
2
|
|||
|
Company
|
2
|
|||
|
Company
Matching Contributions
|
2
|
|||
|
Company
Matching Contributions Account
|
2
|
|||
|
Company
Stock
|
||||
|
Compensation
|
2
|
|||
|
Deferral
Account
|
4
|
|||
|
Deferrals
|
4
|
|||
|
Effective
Date
|
4
|
|||
|
Eligible
Employee
|
4
|
|||
|
Employee
|
4
|
|||
|
Employee
Stock Ownership Plan
|
4
|
|||
|
Employer
Securities
|
5
|
|||
|
Entry
Date
|
5
|
|||
|
ERISA
|
5
|
|||
|
Five
Percent Owner
|
5
|
|||
|
Frozen
After Tax Account
|
5
|
|||
|
Hour
of Service
|
5
|
|||
|
Leased
Employee
|
5
|
|||
|
Normal
Retirement Age
|
5
|
|||
|
Normal
Retirement Date
|
5
|
|||
|
Participant
|
5
|
|||
|
Period
of Severance
|
6
|
|||
|
Permanently
and Totally Disabled
|
6
|
|||
|
Plan
|
6
|
|||
|
Plan
Year
|
6
|
|||
|
Qualified
Consent
|
6
|
|||
|
Qualified
Domestic Relations Order (QDRO)
|
7
|
|||
|
Rollover
Account
|
7
|
|||
|
Service
|
7
|
|||
|
Spouse
|
8
|
|||
|
Total
Vested Account Balance
|
8
|
|||
|
Trust
|
8
|
|||
iii
|
Trust
Agreement
|
8
|
|||
|
Trust
Fund or Funds
|
8
|
|||
|
Trustee
|
8
|
|||
|
USERRA
|
8
|
|||
|
Valuation
Date
|
8
|
|||
|
Valuation
Period
|
8
|
|||
|
Vested
|
8
|
|||
|
Voice
Response System
|
9
|
|||
|
2.
|
PARTICIPATION
|
|||
|
2.01
|
Eligibility
to Become a Participant
|
9
|
||
|
2.02
|
Participation
in the Plan
|
9
|
||
|
2.03
|
Reemployment
|
9
|
||
|
2.04
|
Employment
After Normal Retirement Age
|
9
|
||
|
3.
|
CONTRIBUTIONS
|
|||
|
3.01
|
Contribution
of Participants' Deferrals
|
10
|
||
|
3.02
|
Company
Matching Contributions
|
11
|
||
|
3.03
|
Maximum
Amount of Participant Deferrals
|
11
|
||
|
3.04
|
Limitation
on Deferrals
|
13
|
||
|
3.05
|
Limitation
on Company Matching Contributions
|
19
|
||
|
3.06
|
Limitation
on Annual Additions
|
24
|
||
|
3.07
|
Allocation
of Forfeitures
|
27
|
||
|
3.08
|
Rollover
Contributions
|
27
|
||
|
3.09
|
Employer
Error
|
28
|
||
|
3.10
|
Inclusion
of Ineligible Employee
|
29
|
||
|
4.
|
INVESTMENT OF
CONTRIBUTIONS AND VALUATION OF ACCOUNTS
|
|||
|
4.01
|
Participants'
Accounts
|
29
|
||
|
4.02
|
Investment
Funds
|
29
|
||
|
4.03
|
Investment
of Company Matching Contributions and Voting of Company
Stock
|
30
|
||
|
4.04
|
Allocation
of Investment Income on a Valuation Date
|
30
|
||
|
4.05
|
Limitation
on Participant Investment Instructions
|
31
|
||
|
5.
|
WITHDRAWALS, LOANS AND
QUALIFIED DOMESTIC RELATIONS ORDERS
|
|||
|
5.01
|
Withdrawal
of Frozen After Tax Contributions
|
31
|
||
|
5.02
|
Withdrawal
of Company Matching Contributions
|
32
|
||
|
5.03
|
Loans
to Participants
|
32
|
||
|
5.04
|
Hardship
Withdrawals
|
33
|
||
|
5.05
|
Qualified
Domestic Relations Order
|
36
|
||
iv
|
6.
|
VESTING OF RETIREMENT,
DISABILITY, DEATH, AND
|
|||
|
TERMINATION OF
EMPLOYMENT BENEFITS
|
||||
|
6.01
|
Vesting
Due to Attainment of Normal Retirement Age
|
|||
|
and
Normal Retirement Benefits
|
37
|
|||
|
6.02
|
Vesting
Due to Disability and Disability Benefits
|
37
|
||
|
6.03
|
Vesting
Due to Death and Death Benefits
|
37
|
||
|
6.04
|
Vesting
Upon Termination of Employment and
|
|||
|
Termination
of Employment Benefits
|
37
|
|||
|
6.05
|
Forfeitures
|
38
|
||
|
6.06
|
Reinstatement
of Forfeited Accounts
|
39
|
||
|
7.
|
DISTRIBUTION OF
BENEFITS
|
|||
|
7.01
|
Form
of Distribution
|
39
|
||
|
7.02
|
Timing
of Distributions
|
40
|
||
|
7.03
|
Eligible
Rollover Distributions
|
42
|
||
|
8.
|
PLAN
ADMINISTRATION
|
|||
|
8.01
|
Appointment
of Committee
|
43
|
||
|
8.02
|
Powers
and Duties
|
43
|
||
|
8.03
|
Actions
by the Committee
|
45
|
||
|
8.04
|
Interested
Committee Members
|
45
|
||
|
8.05
|
Investment
Manager
|
45
|
||
|
8.06
|
Indemnification
|
45
|
||
|
8.07
|
Conclusiveness
of Action
|
45
|
||
|
8.08
|
Payment
of Expenses
|
46
|
||
|
8.09
|
Claims
for Benefits
|
46
|
||
|
8.10
|
Request
for Review of Denial
|
47
|
||
|
8.11
|
Decision
on Review of Denial
|
47
|
||
|
8.12
|
Notice
of Time Limits
|
48
|
||
|
8.13
|
Corrections
Pursuant to Remedial Programs
|
48
|
||
|
9.
|
AMENDMENT,
TERMINATION, AND MERGER OF THE PLAN
|
|||
|
9.01
|
Right
to Amend the Plan
|
48
|
||
|
9.02
|
Right
to Terminate the Plan
|
48
|
||
|
9.03
|
Plan
Merger and Consolidation
|
49
|
||
|
10.
|
TRUST FUND AND THE
TRUSTEE
|
|||
|
10.01
|
Selection
of Trustee
|
49
|
||
|
11.
|
TOP-HEAVY PLAN
REQUIREMENTS
|
|||
|
11.01
|
General
Rule
|
49
|
||
|
11.02
|
Vesting
Provisions
|
50
|
||
|
11.03
|
Minimum
Contribution Provision
|
50
|
||
v
|
11.04
|
Limitation
on Compensation
|
50
|
||
|
11.05
|
Limitation
on Contributions
|
51
|
||
|
11.06
|
Coordination
with Other Plans
|
51
|
||
|
11.07
|
Determination
of Top-Heavy Status
|
51
|
||
|
11.08
|
Definition
of Key Employee
|
54
|
||
|
11.09
|
Definition
of Non-Key Employee
|
55
|
||
|
12.
|
USERRA
|
|||
|
12.01
|
Qualified
Military Service
|
55
|
||
|
12.02
|
Eligibility
and Vesting
|
55
|
||
|
12.03
|
Make-up
Deferrals and Company Matching Contributions
|
56
|
||
|
12.04
|
Loan
Repayment Suspension
|
57
|
||
|
13.
|
MISCELLANEOUS
|
|||
|
13.01
|
Limitation
on Distributions
|
57
|
||
|
13.02
|
Limitation
on Reversion of Contributions
|
57
|
||
|
13.03
|
Voluntary
Plan
|
58
|
||
|
13.04
|
Nonalienation
of Benefits
|
58
|
||
|
13.05
|
Inability
to Receive Benefits
|
58
|
||
|
13.06
|
Unclaimed
Benefits
|
58
|
||
|
13.07
|
Limitation
of Rights
|
59
|
||
|
13.08
|
Invalid
Provisions
|
59
|
||
|
13.09
|
One
Plan
|
59
|
||
|
13.10
|
Use
and Form of Words
|
60
|
||
|
13.11
|
Headings
|
60
|
||
|
13.12
|
Governing
Law
|
60
|
||
|
14.
|
EMPLOYEE STOCK OWNERSHIP
PLAN
|
|||
|
14.01
|
Purpose
|
60
|
||
|
14.02
|
Investment
in Company Stock
|
60
|
||
|
14.03
|
Company
Matching Contributions
|
61
|
||
|
14.04
|
Diversification
|
61
|
||
|
14.05
|
Voting
of Employer Securities
|
61
|
||
|
14.06
|
Form
of Distributions
|
61
|
||
|
14.07
|
Dividends
|
61
|
||
|
SCHEDULE A -
INVESTMENT PLANS
|
||||
|
Investment
Funds
|
A-i
|
|||
|
Designation
of Investment Funds
|
A-ii
|
|||
|
Transfer
Between and Among Investment Funds
|
A-ii
|
|||
vi
ARTICLE
1
DEFINITIONS
When used
in this document the following words and phrases have the meaning specified
below. Additional words and phrases may be defined in the text of the
Plan.
Accounts means a
Participant's Company Matching Contributions Account, Deferral Account, Frozen
After Tax Account, and Rollover Account.
Affiliated Company
means the Company, any corporation that is included in a controlled group of
corporations within the meaning of Code Section 414(b) of which group the
Company is also a member, any trade or business that is under common control
with the Company within the meaning of Code Section 414(c), any member of an
affiliated service group within which the Company is also included within the
meaning of Code Section 414(m), and any other entity required to be aggregated
with the Company pursuant to regulations under Code Section 414(o).
Alternate Payee means
any Spouse, former Spouse, child or other dependent of a Participant having
rights to receive all, or a portion of, a Participant's benefits payable under
this Plan pursuant to a Qualified Domestic Relations Order.
Beneficiary means the
person, persons, or entity designated by the Participant to receive any death
benefit that may become payable under the Plan. The Beneficiary of a
married Participant will be his Spouse unless the Participant designates a
Beneficiary other than his Spouse and the Spouse executes a Qualified
Consent. The Spouse may revoke such consent at any time prior to the
payment of any benefits to the designated Beneficiary. The Committee
may dispense with the Spouse's consent if the Spouse cannot be located, or for
such other reasons as provided in Treasury Regulations. A Participant
may designate primary and contingent Beneficiaries. If more than one
Beneficiary is named, the Participant may specify the sequence and/or proportion
in which payments will be made to each Beneficiary. In the absence of
a specification of sequence or proportions, payments will be made in equal
shares to all named Beneficiaries. If no Beneficiary has been
designated or if the Committee is unable to locate a designated Beneficiary or
if no designated Beneficiary is living at the time of the Participant's death,
payment of such death benefit, if any, to the extent permitted by law, will be
made to the Participant's surviving Spouse or, if none, the Participant's
estate. Any minor's share may be paid to such adult or adults as
have, in the opinion of the committee, assumed custody and support of such
minor. However, the Committee reserves the right to delay the payment
of any minor's share until the receipt of a court order designating the adult or
adults to whom such payment shall be made. Any death benefit that
becomes payable to executors or administrators will be paid in one lump
sum. The Committee may require proof of death before payment of any
death benefit under the Plan. The Committee shall have the rights set
forth in Article 12.05 with respect to an incompetent
Beneficiary(ies).
7
Board means the Board
of Directors of Southwest Gas Corporation.
Business Day means a
workday in which the New York Stock Exchange is open, ending at 4:00 p.m.
Eastern Standard Time. All transactions occurring after 4:00 p.m.
Eastern Standard Time on a Business Day will be processed on the following
Business Day.
Code means the
Internal Revenue Code of 1986, as periodically amended.
Committee means the
Employees' Investment Plan Committee as described in Article 8.
Company means
Southwest Gas Corporation and any other Affiliated Company, unit or division of
the Company which adopts the Plan by resolution of its board of directors,
provided such resolution is accepted by the Board or the
Committee. Except as otherwise provided in the terms and conditions
prescribed by Southwest Gas Corporation, all provisions of the Plan will apply
to such Affiliated Company and its Employees.
Company Matching
Contributions means contributions made by the Company pursuant to Article
3.02.
Company Matching
Contributions Account means the account maintained for a Participant
which is: (a) credited with Company Matching Contributions and forfeitures; (b)
adjusted for investment results; and (c) charged with distributions and
withdrawals.
Company Stock means
share of Company common stock.
Compensation
means:
|
(a)
|
For
purposes of determining an Eligible Employee’s benefits under the Plan,
the actual wages paid to an Eligible Employee during the applicable
period, including sales incentive payments and elective contributions that
are not includible in gross income under Code Sections 125, 402 and
403(b), but excluding pay for overtime hours, flexible benefit dollars,
bonuses, or other special payments, and the Company’s contributions toward
insurance, retirement, and other fringe benefits or employee welfare plans
or programs other than severance pay
arrangements.
|
|
(b)
|
For
purposes of Section 3.04, Section 3.05, Section 3.06, and Article 11 only,
an Eligible Employee’s earned income, wages, salaries, fees for
professional services, and other amounts received for personal services
actually rendered in the course of employment with the Company (including,
but not limited to, overtime, other special payments, bonuses, incentive
compensation, commissions on insurance premiums, or tips), whether
actually paid in cash or in kind during the Plan Year by the Company,
excluding:
|
(i) Company
contributions to a plan of deferred compensation;
8
|
|
(ii)
|
Any
group insurance or other health and welfare plan maintained by the
Company;
|
(iii) Distributions
from a plan of deferred compensation;
(iv) Any
amounts realized from the exercise of a nonqualified stock option;
|
|
(v)
|
The
sale, exchange, or other disposition of stock acquired under a qualified
stock option;
|
(vi) Other
amounts that receive special tax benefits; or
|
|
(vii)
|
Any
contributions made toward the purchase of an annuity described in Code
Section 403(b) whether or not such amounts are actually excludable from
the gross income of the Eligible
Employee.
|
Compensation
will mean only Compensation actually paid or includable in gross income in the
Plan Year. In no case will amounts deferred pursuant to Code Section
125 be included as Compensation under this subsection (b).
Notwithstanding
any language in this subsection (b) to the contrary, effective for Plan Years
beginning after December 31, 1996, “Compensation” for the purpose described in
this subsection shall include an Eligible Employee's elective deferrals under
Code Section 402(g)(3), and amounts that pursuant to Code Sections 125 or 457
are contributed or deferred (at the Eligible Employee's election) and are not
includible in the Eligible Employee's gross income in the tax year contributed
or deferred. Notwithstanding any language in this subsection (b) to
the contrary, effective for Plan Years beginning after December 31, 1996,
“Compensation” for the purpose described in this subsection shall include an
Eligible Employee's elective deferrals under Code Section 402(g)(3), and amounts
that pursuant to Code Sections 125 or 457 are contributed or deferred (at the
Eligible Employee's election) and are not includible in the Eligible Employee's
gross income in the tax year contributed or deferred. Notwithstanding
any provision of this Plan to the contrary, the following sentence that includes
the model language of Internal Revenue Service Notice 2001-37 shall apply on and
after January 1, 2001. For Plan Years beginning on and after January
1, 2001, for purposes of applying the limitations described in Section 3.06, the
top-heavy plan rules of Article 11, the Section 3.05(a) of “Compensation
Percentage” and the Section 3.04(a) definition of “Actual Deferral Percentage,”
Compensation paid or made available during such Plan Years shall include
elective amounts that are not includible in the gross income of the employee by
reason of Code Section 132(f)(4).
|
(c)
|
The
annual Compensation taken into account under the Plan for any Plan Year
beginning on or after January 1, 1989, shall not exceed the maximum dollar
amount
|
9
($200,000
for the year beginning in 1989 and any other amount that applies for a later
year, including the limit of $150,000 that applies for the year beginning in
1994 and $200,000 for the year beginning January 1, 2002) that is permitted as
of the beginning of the year under Code Section 401(a)(17) (determined after
giving effect to any statutory changes affecting Code Section 401(a)(17) and any
indexing or other adjustments pursuant to Code Section 401(a)(17) that are
applicable for the year of the determination). In the case of a short
Plan Year or other period of less than 12 months requiring a reduction of the
Code Section 401(a)(17) annual limit, the otherwise applicable limit shall be
prorated by multiplying it by a fraction, the numerator of which is the number
of months in the short period and the denominator of which is
12. Moreover, effective January 1, 1987, to December 31, 1996,
in determining an Employee's Compensation for purposes of the Code Section
401(a)(17) limit, the rules of Code Section 414(q)(6) (requiring the aggregation
of Compensation paid to family members of certain Five Percent Owners and the
ten most highly compensated Employees) shall apply, except that in applying such
rules, the term "family" shall include only the Spouse of the Employee and any
lineal descendants of the Employee who have not attained age 19 before the close
of the year. If, as a result of the application of such rules, the
adjusted annual Code Section 401(a)(17) Compensation limit is exceeded, then
such limit shall be prorated among the affected individuals in proportion to
each such individual's Compensation as determined prior to the application of
the Code Section 401(a)(17) limit.
Effective
for Plan Years beginning after December 31, 1996, the aforesaid family
aggregation rules shall no longer apply.
Deferral Account
means the account maintained for a Participant that is: (a) Credited with
Company contributions into the Plan attributable to the Participant's Deferrals
under Section 3.01, (b) Adjusted for investment results, and (c) Adjusted for
distributions and withdrawals.
Deferrals means an
amount contributed to this Plan by the Company in lieu of being paid to a
Participant as salary or wages. Deferrals will be made under salary
reduction arrangements between each Eligible Employee and the
Company. Section 3.01 contains the provisions under which Deferrals
may be made. Deferrals consist of Matched Deferrals as described in
Section 3.01(a) and Unmatched Deferrals, if any, as described in Section
3.01(b).
Effective Date means
April 1, 1965. Notwithstanding the foregoing, the effective date of
this restatement of the Plan shall be October 1, 2001, provided, however, that
if a provision of this restatement of the Plan has a specific effective date
other than October 1, 2001, the date so specified shall be the effective
date of such provision.
Eligible Employee
means any Employee who is employed by the Company and who (a) is not included in
a unit of Employees covered by a collective bargaining agreement (as
so
10
determined
by the Secretary of Labor) between Employee representatives and the Company if
retirement benefits were the subject of good faith bargaining between such
employee representatives and the Company unless such collective bargaining
agreement expressly provides for the inclusion of such persons as Participants
in the Plan, and (b) is not an non-resident alien individual described in Code
Section 414(b)(3)(C) (a nonresident alien individual without income from
performing services in the United States). Additionally, an
individual who is not an Employee shall not be eligible to participate in the
Plan even if such person is subsequently determined by a court of law or
regulatory body to have been a common law Employee of the Company.
Employee means any
person who is employed by the Company and receives regular Compensation from the
Company. The term “Employee” shall not include any person who is not
recorded as being an employee on the payroll records of the Company including
any such person who is subsequently reclassified by a court of law or regulatory
body as a common law employee of the Company. Consistent with the
foregoing and for purposes of clarification only, the term Employee does not
include (a) a Code Section 414(n) leased employee, (b) a leased employee other
than a Code Section 414(n) leased employee, or (c) any individual who performs
services for the Employer as an independent contractor, or under any other
non-employee classification, or through a temporary help firm, employee leasing
firm, or professional employer organization.
Employee Stock Ownership
Plan or ESOP means the portion of Participants’ Deferral and Company
Matching Contribution Accounts invested in the Southwest Gas
Stock Fund and are designated as, and are intended to constitute, an
employee stock ownership plan within the meaning of Code Section 4975(e)(7) and
ERISA Section 407(d)(6).
Employer Securities
means shares of Company Stock that meet the requirements of Code Section
409(l). For purposes of the Plan, as the context requires, this term
also refers to and includes Company Stock.
Entry Date means the
first day of the first full pay period after becoming eligible to participate in
the Plan.
ERISA means the
Employee Retirement Income Security Act of 1974, as amended.
Five Percent Owner
means any person who owns (or is considered as owning within the meaning of Code
Section 318) more than five percent (5%) of the outstanding stock of the Company
or stock possessing more than five percent (5%) of the total combined voting
power of all stock of the Company.
Frozen After Tax
Account means the account maintained for a Participant which is: (a)
credited with contributions attributable to the Participant's after-tax
contributions under the terms of the Plan as it was constituted on December 31,
1984; (b) adjusted for distributions and withdrawals; and (c) adjusted for
investment results. Effective January 1, 1985, Participant
after-tax contributions shall not be allowed.
11
Hour of Service means
an hour for which an Employee is directly or indirectly paid, or entitled to
payment, by the Company for the performance of duties. These hours
shall be credited to the Employee for the Plan Year in which the duties are
performed. The computation of nonwork hours included in this
definition will be computed in accordance with the provisions of Department of
Labor Regulation Section 2530.200b-2.
Leased Employee means
an individual that (a) is not an Employee, (b) provides services to the Company
pursuant to an agreement between a leasing organization and the Company, (c) has
performed services for the Company on a substantially full-time basis for a
period of at least a year, (d) effective for Plan Years beginning after December
31, 1996, provides services under the primary direction or control of the
Company, and (e) effective for Plan Years beginning before January 1, 1997,
provides services to the Company of a type historically performed by
Employees in the Company’s primary business field. Additionally, an
individual who satisfies the requirements to be a “Leased Employee”
shall not be considered to be an employee for Code nondiscrimination testing
purposes if (a) he is covered by a money purchase plan of the leasing
organization that provides (1) a nonintegrated employer contribution rate of at
least 10 percent of compensation, as defined in Code Section 415(c)(3), but
including amounts contributed pursuant to a salary reduction agreement which are
excludable from his/her gross income under Code Sections 125, 402(g)(3), 402(h),
or 403(b), (2) immediate participation, and (3) full and immediate vesting; and
(b) Lease Employees do not constitute more than twenty percent (20%) of the
Company’s non-highly compensated workforce.
Normal Retirement Age
means age sixty-five (65).
Normal Retirement
Date means the first day of the month following attainment of Normal
Retirement Age.
Participant means any
former or current Eligible Employee whose Accounts have not been subsequently
distributed and forfeited in full.
Period of
Severance:
|
(a)
|
"Period
of Severance" means, for any Employee, the period beginning on the
Employee's severance from Service date and ending on the date the Employee
next completes an Hour of Service. An Employee's severance from
Service date will occur on the earlier
of:
|
(i) The
date on which the Employee quits, retires, is discharged, or dies,
or
|
|
(ii)
|
The
first anniversary of the first date of a period in which an Employee
remains absent from Service (with or without pay) with the Company for any
reason other than resignation, retirement, discharge, or death, such as
vacation, holiday, sickness, disability, leave of absence, or
layoff.
|
12
A one (1)
year Period of Severance is a twelve (12) consecutive-month period beginning on
the Employee's severance from Service date in which the Employee does not
perform an Hour of Service. A Period of Severance shall be calculated
in a manner that complies with the Family and Medical Leave Act of
1994.
|
(b)
|
Subject
to verification by the Committee, an Employee will be deemed not to have
incurred a Period of Severance during the twenty-four (24)
consecutive-month period that the Employee is first absent from employment
by reason of:
|
(i) The
Employee's pregnancy;
(ii) Birth
of a child of the Employee;
|
|
(iii)
|
Placement
of a child with the Employee in connection with the adoption of the child
by the Employee; or
|
|
|
(iv)
|
Caring
for such child for a period beginning immediately following the birth or
placement for adoption.
|
Permanently and Totally
Disabled means a disability due to sickness or injury which the Committee
determines whether a Participant is incapable of
performing any Service for the Company for which he is qualified by education,
training, or experience. Evidence of disability satisfactory to the
Committee will be required.
Plan means the Plan
designated as the Southwest Gas Corporation Employees' Investment Plan as
described in this document and as it may be periodically amended.
Plan Year means the
period beginning on January 1 and ending on December 31. The Plan
Year will be the limitation year for purposes of Code Section 415 and Section
3.06 of the Plan.
Qualified Consent
means a written consent executed by a Participant's Spouse in the presence of an
authorized Plan representative or notary public which by its terms acknowledges
the effect of the consent. Such consent must designate any non-Spouse
Beneficiary(ies), any class of non-Spouse Beneficiaries, or any contingent
Beneficiaries which may not be changed without a second Qualified Consent unless
the first Qualified Consent permits the Participant to: (a) designate
a different Beneficiary without the Spouse's consent; and (b) acknowledges that
the Spouse has the right to limit consent to a specific
Beneficiary. A Qualified Consent shall be valid only with respect to
the Spouse who signs it.
Qualified Domestic Relations
Order (QDRO) means any judgment, decree or order (including approval of a
property settlement agreement), which relates to the provision of child support,
alimony or marital property rights made pursuant to State domestic
relations
13
law
(including community property law), which recognizes an Alternate Payee's right
to, or assigns to an Alternate Payee the right to, all or a portion of the
benefits otherwise receivable under this Plan and which
specifies: (a) the name and last known address of the Participant and
each Alternate Payee covered by the QDRO; (b) the amount or percentage of the
Participant's benefits to be paid to each Alternate Payee, or the manner in
which the amount or percentage is to be determined; and (c) the number of
payments or period to which the QDRO applies. The QDRO may not
require this Plan to provide increased benefits or any type or form of benefit
or option not provided for in Article 7 or require payment of benefits required
to be paid to another Alternate Payee by a previous QDRO.
Rollover Account
means the account maintained for a Participant which is: (a) credited with any
Article 3.08 rollover tendered to and accepted by the Trust; (b) adjusted for
investment results; and (c) charged with distributions and (if allowed)
withdrawals.
Service means, with
respect to any Employee, his period or periods of employment with an Affiliated
Company that are counted as "Service" in accordance with the following
rules:
|
(a)
|
Each
Employee shall be credited with Service under the Plan for the period or
periods during which such Employee maintains an employment relationship
with the Affiliated Company. An Employee's employment
relationship will commence on the date the Employee first renders one Hour
of Service and ends on his severance from Service date. Service
will also include the following
periods:
|
|
|
(i)
|
Periods
of leave of absence with or without pay granted to the Employee by the
Affiliated Company in a like and nondiscriminatory manner for any purpose
including, but not limited to, sickness, accident, or military
leave. Such Employee shall not be considered to have terminated
employment during such leave of absence unless he fails to return to the
employ of the Company at or prior to the expiration date of such leave, in
which case he shall be deemed to have terminated as of the date of
commencement of such leave.
|
|
|
(ii)
|
Periods
during which a person is Permanently and Totally Disabled. Such
person shall not be considered to have terminated employment during such
period of disability unless he fails to return to the employ of the
Company at the expiration of such period, in which case he shall be deemed
to have terminated as of his date of
recovery.
|
|
|
(iii)
|
The
period of time between an Employee's severance from Service date by reason
of a resignation, discharge, or retirement and his reemployment date, if
the Employee returns to Service on or before such first anniversary
date.
|
|
(b)
|
In
the case of a person who incurs five (5) consecutive one (1) year Periods
of Severance, whose whole years of Service prior to his severance are less
than five
|
14
(5)
years, who is not Vested pursuant to Section 6.04 at the time he incurs such
five (5) consecutive one (1) year Periods of Severance, but is then reemployed
by the Company; his Service prior to such five (5) consecutive one (1) year
Periods of Severance shall be forfeited and shall not be included in determining
his Service under paragraph (a) above. Such person's Service at the
time of a one (1) year Period of Severance shall not include any Service
disregarded by virtue of the application of this subparagraph to any prior one
(1) year Period of Severance.
|
(c)
|
Subject
to (b) above, all periods of an Employee's Service, whether or not
consecutive, will be aggregated. Service will be measured in
elapsed years and fractions of years whereby each twelve (12) complete
calendar months will constitute one year, each completed calendar month
will constitute one-twelfth (1/12) of a year, and partial calendar months
which when aggregated equal thirty (30) days will constitute one-twelfth
(1/12) of a year.15
|
Spouse means the
person to whom the Participant has been legally married throughout the one year
period ending on the earlier of the date the Participant receives or begins to
receive his benefit payment from the Plan, or the date of the Participant's
death.
Total Vested Account
Balance means the value of the Participant's Deferral Account, Frozen
After Tax Account, and Rollover Account, as well as the Vested portion of his
Company Matching Contributions Account.
Trust means one or
more Trusts established pursuant to the Trust Agreement for purposes of funding
the benefits of this Plan.
Trust Agreement means
one or more Trust Agreements executed by the Company and provided for the
administration of the Trust.
Trust Fund or Funds
means the total amount of contributions made by the Participants and the Company
together with the net earnings on them, that will be used to provide the
benefits to Participants and their Beneficiaries under the Plan.
Trustee means the
Trustee of the Trust and any successor Trustee as appointed in the Trust
Agreement.
USERRA means the
Uniform Services Employment and Reemployment Rights Act of 1994.
Valuation Date means
the close of business of each Business Day.
Valuation Period
means daily.
Vested means
nonforfeitable. The Vested portion of a Participant's Account is
determined in accordance with the provisions of Article 6.
15
Voice Response System
means a system of telephonic or other verbal or electronic communication with
the Plan Trustee or record-keeper that has been approved by the Committee for
the purpose of making certain elections under the Plan.
ARTICLE
2
PARTICIPATION
|
2.01
|
Eligibility to Become
a Participant
|
|
|
(a)
|
All
Participants
|
Effective
April 1, 1992, any Eligible Employee shall be eligible to participate in the
Plan.
|
|
(b)
|
Affiliated Company
Employees
|
If a
company other than Southwest Gas Corporation becomes an Affiliated Company after
December 31, 1988, any employee of such company may elect to become an Eligible
Employee as of the later of the employee's date of hire by such company or the
date such company adopts the Plan in a manner acceptable to the Committee or the
Board.
|
2.02
|
Participation in the
Plan
|
An
Eligible Employee shall become a Participant on the Entry Date coincident with
or first following successful completion of enrollment through the Voice
Response System, or in such other manner as is allowed by the Committee from
time to time, authorizing the Company to withhold such contributions from his
Compensation and to pay the same amount to the Trustee, designating the
allocation of these contributions between the Investment Funds, and designating
a Beneficiary.
|
2.03
|
Reemployment
|
If an
Eligible Employee who met the eligibility requirements of Section 2.01 and whose
employment has terminated is subsequently rehired as an Eligible Employee, he
may elect to participate pursuant to Section 2.02 and shall, if administratively
practicable, enter the Plan on the following Entry Date. A rehired
Employee who had not met the eligibility requirements of Section 2.01 before his
employment terminated will be eligible to enter the Plan on the first Entry Date
after he satisfies the requirements of Section 2.01. If an Eligible
Employee terminates employment and is rehired in the same Plan Year, he may
elect to participate
16
pursuant
to Section 2.02 on the date he is rehired and shall, if administratively
practicable, enter the Plan on the following Entry Date.
|
2.04
|
Employment After
Normal Retirement Age
|
A
Participant who continues in the employ of the Company after Normal Retirement
Age will continue to be eligible to be a Participant.
ARTICLE
3
CONTRIBUTIONS
|
3.01
|
Contribution of
Participant's Deferrals
|
|
|
(a)
|
Matched
Deferrals
|
Upon
enrollment or reenrollment in the Plan, each Participant must elect to reduce
his Compensation in a fixed whole percentage of not less than 2 percent and not
more than 6 percent. The Company will make payments to the Plan
within the time frame required by applicable laws and regulations of the amount
of the reduction, to be credited to the Participant's Deferral
Account. Amounts deferred under this subsection will be contributed
as Matched Deferrals.
|
|
(b)
|
Unmatched
Deferrals.
|
Participant
making Matched Deferrals at the maximum percentage rate may elect to further
reduce his Compensation in a fixed whole percentage of not less than one percent
(1%) and not more than fifty-four percent (54%) or the cash
compensation payable to the Participant after all other applicable
withholdings. The
Company will make payments to the Plan within the time frame required by
applicable laws and regulations of the amount of the reduction to be credited to
the Participant's Deferral Account. Amounts deferred under this
subsection will be contributed as Unmatched Deferrals.
|
|
(c)
|
Change in Percentage
or Suspension of Deferrals
|
A
Participant's Deferral percentage will remain in effect until the Participant
elects to change the percentage. A Participant may elect to change or
suspend his Deferral percentage or resume all suspended Deferrals through the
Voice Response System or in such other manner as is approved by the Committee
from time to time. Changes to a Participant’s Deferral election may
be made on a daily basis and will be effective as soon as practicable
thereafter, but in no event will such change become effective prior to the
beginning of the Participant’s next full pay period.
17
|
|
(d)
|
Status of
Deferrals
|
Participant
Deferrals under this section will be made by payroll deductions authorized by
the Participant and will be paid to the Plan by the
Company. Participant Deferrals constitute Company contributions under
the Plan and are intended to qualify as elective contributions under Code
Section 401(k). Elective contributions invested by Participants in
the Southwest Gas Stock Fund are also intended to qualify as contributions under
the ESOP provisions of the Plan.
|
3.02
|
Company Matching
Contributions
|
|
|
(a)
|
The
Company will, on behalf of eligible Participants, contribute an amount
which equals the sum of the amounts to be allocated to the Company
Matching Contributions Account of each eligible
Participant. The amount allocated to the Company Matching
Contributions Account for each eligible Participant will equal fifty
percent (50%) of the eligible Participant's Matched Deferrals plus
forfeitures allocated under Section 3.07. The maximum Company
Matching Contribution under this Plan equals three percent (3%) of a
Participant's Compensation. For purposes of this Section
3.02(a), the term "eligible Participant" means any Participant other than
a Participant who is an officer of the Company or who has been selected to
participate in the Company's executive deferral
plan.
|
|
|
(b)
|
Payment
of Company Matching Contributions for a Plan Year ending in or with the
Company's taxable year will be made at any time during such taxable year
or after its close, but not later than the date, including extensions, on
which the Company's federal income tax return is due with respect to such
taxable year.
|
|
|
(c)
|
Each
Company Matching Contribution will be a complete discharge of the
financial obligations of the Company under the Plan with respect to the
period for which it is made.
|
|
|
(d)
|
Company
Matching Contributions invested in the Southwest Gas Stock Fund are also
intended to qualify as contributions under the ESOP provisions of the
Plan.
|
18
|
3.03
|
Maximum Amount of
Participant Deferrals
|
|
|
(a)
|
Amount.
|
No
Eligible Employee who is a Participant will be permitted to make Deferrals under
this Plan or any other qualified plan maintained by the Company during any
taxable year in excess of the dollar limitation contained in Code Section 402(g)
in effect for such taxable years, except to the extent permitted under Section
3.03(b) of the Plan and Code Section 414(v), if applicable. The
foregoing limit shall not apply to Deferrals of amounts attributable to service
performed in 1986 and described in Section 1105(c)(5) of the Tax Reform Act of
1986.
|
|
(b)
|
Catch-Up
Contributions
|
For Plan
Years beginning after December 31, 2001, Participants who have attained age 50
before the close of the Plan Year shall (at such times and in such manner as is
determined by the Committee with respect to all Participants eligible to make
catch-up contributions) be eligible to make catch-up contributions in accordance
with, and subject to the limitations of Code Section 414(v). Such
catch-up contributions shall not be taken into account for purposes of the
provisions of the Plan implementing the required limitations of Code Sections
402(g) and 415.
|
|
(c)
|
Definitions.
"Excess Deferrals" mean the amount by
which:
|
|
|
(i)
|
The
sum of: (A) a Participant's Deferrals under the Plan for a given calendar
year; and (B) his Deferrals under any other Code Section 401(k) qualified
plan, a simplified employee pension plan, a Code Section 501(c)(18) plan
or a Code Section 403(b) annuity for such calendar year
exceeds
|
|
|
(ii)
|
The
sum of: (A) seven thousand dollars ($7,000); and (B) the
accumulated increments, if any, as of the last day of such calendar year,
which have been added to the seven thousand dollars ($7,000) for
cost-of-living increases under Code Section
402(g).
|
|
|
(d)
|
Treatment of Excess
Deferrals.
|
If a
Participant has made Excess Deferrals, the following provisions shall
apply:
|
|
(i)
|
In
the event that a Participant (or the Company under the circumstances
described in Treas. Reg. ' 1.402(g)-1(e)(2)) notifies the Committee in
writing on or prior to March 1 of a given calendar
year
|
19
that: (A)
he has Excess Deferrals included with his Deferrals under this Plan for the
immediately preceding calendar year; and (B) the amount of such Excess Deferrals
which are to be allocated to this Plan for such immediately preceding calendar
year, the Committee shall direct the Trustee to make a single payment from the
Trust Fund, adjusted for any applicable Trust Fund investment income or loss
thereon, to the Participant by April 15 immediately following the calendar year
in which the Excess Deferrals occurred.
|
|
(ii)
|
Excess
Deferrals to be distributed under this Section 3.03 shall be adjusted to
include any applicable Trust Fund investment income or loss thereon for
the immediately preceding calendar year. The investment income
or loss attributable to the Excess Deferrals for the immediately preceding
calendar year shall be the sum of the income or loss allocable to the
Participant's Deferral Account for the immediately preceding calendar year
multiplied by a fraction: (A) the numerator of which is the
Participant's Excess Deferrals; and (B) the denominator of which is the
balance in the Participant's Deferral Account on the last day of the
immediately preceding calendar year reduced by the income and increased by
the loss allocable to said Deferral Account for the calendar
year. The distribution shall reduce the Participant's Deferral
Account as of the date it is distributed. The portion of a
Participant's Excess Deferrals to be distributed in accordance with this
Section 3.03 shall be reduced by any Excess Contributions previously
distributed to the Participant with respect to the same Plan Year under
Section 3.04. The lump-sum distribution amount shall be debited
from the Participant's Deferral Account as of the date it is
distributed. The Committee shall establish such rules and give
such timely directions to the Trustee as the Committee, in its sole
discretion, deems appropriate to carry out the provisions of this
paragraph.
|
|
|
(iii)
|
Any
Excess Deferrals which are distributed to the Participant as provided
above shall not be included in the Participant's taxable income for
purposes of federal income taxes for the calendar year in which the
deferrals are distributed but shall be included in his taxable income for
the calendar year in which the Excess Deferrals were
made. Earnings and losses attributable to the distributed
Excess Deferrals shall be included in the Participant's taxable income in
the calendar year in which the deferrals are
distributed.
|
20
|
3.04
|
Limitation on
Deferrals
|
|
|
(a)
|
Definitions.
|
For
purposes of this Section 3.04, the following terms shall have the following
meanings:
|
|
(i)
|
"Actual
Deferral Percentage" means, with respect to Higher Compensated Employees
and Lower Compensated Employees for a Plan Year, the average of the ratios
(expressed as percentages), calculated separately for each Employee in the
group applying to him or her and hereafter referred to as the "Actual
Deferral Ratio," of the Employees' Deferrals for the Plan Year to the
Employees' Compensation for the Plan Year. Notwithstanding the
foregoing, if a Higher Compensated Employee is eligible to participate in
two (2) or more plans of the Employer which are subject to Code Section
401(k), the Actual Deferral Ratio for the Higher Compensated Employee will
be determined by treating all such plans as a single plan. If a
Higher Compensated Employee or a Lower Compensated Employee makes no
pre-tax deposits during a Plan Year, the Employee's Actual Deferral Ratio
will be zero for such Plan Year.
|
If during
the Determination Year or Look-Back Year, an individual employed by the Employer
is an Employee and is a Family Member of either a Five Percent Owner, or a
Higher Compensated Employee who is one of the ten (10) most highly compensated
Employees of the Company (ranked on the basis of Compensation paid by the
Company during such year), the Actual Deferral Ratio for the Five Percent Owner
or Higher Compensated Employee and such Family Member (who together shall be
treated as one Higher Compensated Employee) shall be the ratio determined by
combining the Deferrals and Compensation of all eligible Family
Members.
Effective
for Plan Years beginning after December 31, 1996, the aforesaid family
aggregation rules shall no longer apply.
Deferrals
will be taken into account in determining a Participant's Actual Deferral Ratio
for a Plan Year only if such contributions are: (a) allocated to the
contributing Participant's applicable Plan account, as of a date within such
year, i.e.: (b) are not contingent on the Participant's Plan
participation or performance of future services subsequent to such date; (c) are
actually paid to the Trust by the end of the twelfth (12th) month following the
close of the Plan Year; and (d) relate to Compensation that either would have
been received by the Participant in the Plan Year (but for being contributed as
a
21
Deferral
to the Plan) or is attributable to services performed by the Participant in the
Plan Year and would have been received by the Participant within two and
one-half months after the close of the Plan Year (but for being contributed to
the Plan as a Deferral).
|
|
(ii)
|
"Determination
Year" means the Plan Year for which the determination of who are Higher
Compensated Employees is being
made.
|
|
|
(iii)
|
"Company"
means, for purposes of this Section 3.04, the Company and other employers
aggregated under Code Section 414(b), (c), (m) or
(o).
|
|
|
(iv)
|
"Excess
Contributions" mean the amount of Deferrals of Higher Compensated
Employees made during the Plan Year that cause the Actual Deferral
Percentage for the group to exceed the level of Deferrals allowed by
Section 3.04(b).
|
|
|
(v)
|
"Excess
Deferrals" mean the Deferrals defined in Section
3.03.
|
|
|
(vi)
|
"Family
Member" means, with respect to any Higher Compensated Employee, the Higher
Compensated Employee's Spouse and lineal ascendants or descendants and the
spouses of such lineal ascendants or descendants. Legal
adoption shall be taken into account in determining whether an individual
is a Family Member.
|
|
|
(vii)
|
"Higher
Compensated Employees" mean employees who in the Determination Year are
eligible to participate in this Plan (including individuals who are
eligible to participate in this Plan and who would be Higher Compensated
Employees but elect not to participate) and who in the Determination Year
or Look-Back Year:
|
|
|
(A)
|
Were
a Five Percent Owner;
|
|
|
(B)
|
Received
Compensation from the Company exceeding seventy five thousand dollars
($75,000) (or such higher amount adjusted in accordance with regulations
prescribed by the Secretary of Treasury or his or her delegate under Code
Section 414(q));
|
|
|
(C)
|
Received
Compensation from the Company exceeding fifty thousand dollars ($50,000)
(or such higher amount adjusted in accordance with regulations prescribed
by the Secretary of Treasury or his or her delegate under Code Section
414(q)) and were in the Top Paid Group;
or
|
22
|
|
(D)
|
Were
at any time an officer of the Company who received Compensation during
such year exceeding fifty percent (50%) of the dollar limitation in effect
for such year under Code Section 415(b)(1)(A). For purposes of
this subparagraph (D), the number of officers shall be limited to fifty
(50) Employees (or if lesser, the greater of three (3) Employees or ten
percent (10%) of the combined total of Employees); and if for any year no
officer of the Employer earns Compensation greater than the amount
referred to in this subparagraph (D) the highest paid officer of the
Company, if an Employee, shall be treated as a Higher Compensated
Employee.
|
As an
alternative to the above, if: (A) at all times during any Plan Year,
the Company maintained significant business activities and employed employees in
at least two (2) significantly separate geographic areas; and (B) the Company
satisfies such other conditions as the Secretary of Treasury or his or her
delegate may prescribe, then the Company may make the following election in
determining whether an Employee is a Higher Compensated Employee for such Plan
Year: (A) item (vii)(B) above shall be applied by substituting fifty
thousand dollars "($50,000)" (or such higher amount adjusted in accordance with
regulations prescribed by the Secretary of Treasury or his or her delegate under
Code Section 414(q)) for seventy-five thousand dollars "($75,000)"; and (B) item
(vii)(C) above shall not apply.
Notwithstanding
the above, an Employee who fits in item (vii)(B), (vii)(C), or (vii)(D) above in
the Determination Year, but not in the Look-Back Year, will not be a Higher
Compensated Employee unless: (A) he or she is a Five Percent Owner in
the Determination Year or the Look-Back Year; or (B) he or she is one of the one
hundred (100) highest paid Employees of the Employer during the Determination
Year. "Higher Compensated Employees" also means any individuals who
were Employees, separated from service with the Company before the Determination
Year, and were Higher Compensated Employees in the Plan Year they separated from
service with the Company or any Plan Year ending on or after they attained age
fifty-five (55).
If an
Employee is, during a Determination Year or Look-Back Year, a Family Member of
either a Five Percent Owner who is an active or former Employee or a Higher
Compensated Employee who is one of the ten (10) most highly compensated Higher
Compensated Employees ranked on the basis of Compensation paid by
the
23
Company
during such year, then the Family Member and the Five Percent Owner or top-ten
Higher Compensated Employee shall be aggregated. In such case, the
Family Member and Five Percent Owner or top-ten Higher Compensated Employee
shall be treated as a single Employee receiving Compensation and Plan
contributions or benefits equal to the sum of such Compensation and
contributions or benefits of the Family Member and Five Percent Owner or top-ten
Higher Compensated Employee.
The
determination of who is a Higher Compensated Employee, including determinations
of the number and identity of Employees in the Top-Paid Group, the top one
hundred (100) Employees, the number of Employees treated as officers, and the
Compensation that is considered, will be made in accordance with Code Section
414(q) and the regulations thereunder.
Notwithstanding
any language to the contrary in this subsection, effective for Plan Years
beginning after December 31, 1996, the term “Higher Compensated Employees” shall
for a given Determination Year mean solely Eligible Employees able to
participate in the Plan during such Plan Year whether or not participating, and
who:
|
|
(A)
|
are
a Five Percent Owner during the Determination Year or Look Back Year;
or
|
|
|
(B)
|
for
the Look-Back Year, had compensation exceeding eighty thousand dollars
($80,000) (this dollar amount shall be adjusted at the same time and in
the same manner as under Code Section 415(d)) and (if the Company elects
for the Look-Back Year immediately preceding the Determination Year in a
manner consistent with guidance prescribed by the Internal Revenue
Service; provided such guidance is issued) is in the Top Paid Group of
Eligible Employees in the Look-Back Year. The Employer did not
make a Top Paid Group election in Plan Years occurring during the period
in 1997-2001.
|
In
determining which Eligible Employees are Higher Compensated Employees for the
first Plan Year after December 31, 1996, the family aggregation rules set forth
in this subsection shall not be applied in such Plan Year or the proceeding Plan
Year.
|
|
(viii)
|
"Look-Back
Year" means the twelve-month period immediately preceding the
Determination Year.
|
24
|
|
(ix)
|
"Lower
Compensated Employees" mean Employees who in the Determination Year are
eligible to participate in the Plan (including individuals who are
eligible to participate in this Plan and who would be Lower Compensated
Employees but elect not to participate) and who are not Higher Compensated
Employees.
|
|
|
(x)
|
"Top
Paid Group" means the top twenty percent (20%) of the Employees ranked on
the basis of Compensation during the year; provided, however, that
Employees described in Code Section 414(q)(8) and Q&A 9(b) of
Temporary Treasury Regulation Section 1.414 (q)-1T are excluded in the
manner provided therein.
|
|
|
(b)
|
401(k)
Nondiscrimination Test.
|
Each Plan
Year the annual allocation derived from a Participant's Deferrals shall satisfy
one of the following tests or any other test which might be prescribed under
Code Section 401(k):
|
|
(i)
|
The
Actual Deferral Percentage for Higher Compensated Employees shall not
exceed the Actual Deferral Percentage for Lower Compensated Employees
multiplied by 1.25; or
|
|
|
(ii)
|
The
Actual Deferral Percentage for Higher Compensated Employees shall not
exceed 2 multiplied by the Actual Deferral Percentage for Lower
Compensated Employees; and the excess for the Actual Deferral Percentage
for Higher Compensated Employees over the Actual Deferral Percentage for
Lower Compensated Employees shall not exceed 2 percentage
points.
|
Notwithstanding
the foregoing provisions of this subsection, effective for Plan Years beginning
after December 31, 1996, the Actual Deferral Percentage for Lower Compensated
Employees that shall, except as provided in the following sentence, be used in
applying the tests set forth in this subsection for a Determination Year shall
be the Actual Deferral Percentage for Lower Compensated Employees in the
Determination Year. The Company may elect (in a manner consistent
with guidance prescribed by the Internal Revenue Service; provided such guidance
is issued) to use, when applying the tests set forth in this subsection, the
Actual Deferral Percentage of Lower Compensated Employees in the Look-Back Year
instead of the Determination Year. In the Plan Years beginning
January 1, 1997, 1998, 1999, 2000 and 2001, the Company elected to utilize the
Actual Deferral Percentage of Lower Compensated Employees for the Determination
Year.
|
|
(c)
|
Treatment of Excess
Contributions.
|
25
If the
limits in Section 3.04(b) are exceeded in any Plan Year, the following
provisions shall apply:
|
|
(i)
|
Notwithstanding
any provisions of this Plan to the contrary, if the Committee determines
that a Higher Compensated Employee's Deferrals for any Plan Year will
cause this Plan to fail to meet the nondiscrimination test of Section
3.04(b), the Committee, in its sole discretion, may reduce (or suspend, if
necessary) the rate of future Deferrals of the Higher Compensated
Employee.
|
The
Committee shall make the reduction on a uniform basis. It shall first
apply to Higher Compensated Employees then contributing the highest rate of
Section 3.01 unmatched Deferrals and then to Higher Compensated Employees then
contributing the next highest rate of Section 3.01 unmatched Deferrals and so
on, in descending order, from the highest rate. If the reduction of
Section 3.01 unmatched Deferrals is not sufficient, then the reduction shall
apply to Higher Compensated Employees then contributing the highest rate of
Section 3.01 matched Deferrals and then to Higher Compensated Employees then
contributing the next highest rate of Section 3.01 matched Deferrals and so on,
in descending order from the highest rate. The Committee shall
establish such rules as the Committee, in its sole discretion, deems appropriate
to carry out the provisions of this paragraph.
For the
purposes of this subsection, the phrases “rate of Section 3.01 Unmatched
Deferrals” and “rate of Section 3.01 Matched Deferrals” shall, for Plan Years
beginning after December 31, 1996, refer to the dollar amount of such
Deferrals. In Plan Years beginning prior to January 1, 1997, the
phrase “rate of Section 3.01 Unmatched Deferrals” shall refer to the ratio of a
Higher Compensated Employee’s Unmatched Deferrals to Compensation and the phrase
“rate of Section 3.01 Matched Deferrals” shall refer to the ratio of a Higher
Compensated Employee’s Matched Deferrals to Compensation.
|
|
(ii)
|
In
the event that the Deferrals allocated to Higher Compensated Employees for
any Plan Year result in Excess Contributions, the Committee shall direct
the Trustee to distribute the Excess Contributions, adjusted for any
applicable Trust Fund investment income or loss thereon, to the affected
Higher Compensated Employees by March 15 following the Plan Year in which
the Excess Contributions occurred but in no event later than the close of
the Plan Year following the Plan Year in which the Excess Contributions
occurred. To determine the portion of the Excess Contributions
to be
|
26
distributed
to each Higher Compensated Employee, the Committee shall direct the Trustee to
distribute the Deferrals allocated to Higher Compensated Employees for the Plan
Year in which the Excess Contributions occurred to the extent necessary to
prevent the Actual Deferral Percentage for the group of Higher Compensated
Employees from exceeding the permissible Actual Deferral Percentage for the
group.
The
Committee shall direct the Trustee to make the distribution on a uniform
basis. It shall first be made with respect to Higher Compensated
Employees with the highest Actual Deferral Ratio for the Plan Year and then with
respect to Higher Compensated Employees with the next highest Actual Deferral
Ratio for the Plan Year and so on, in descending order from the highest rate
until the test in Section 3.04(b) is satisfied.
For the
purposes of this subsection, the phrase “Actual Deferral Ratio” shall for Plan
Years beginning after December 31, 1996, refer to the dollar amount of such
Deferrals and for Plan Years beginning before January 1, 1997, shall mean the
Actual Deferral Ratio of a Higher Compensated Employee.
The
portion of the Excess Contributions applicable to each Higher Compensated
Employee shall be distributed to the Higher Compensated Employee in a single
payment. The portion of each Higher Compensated Employee's Excess
Contributions that is to be distributed in accordance with this Section 3.04
shall be reduced by any Excess Deferrals previously distributed to the Higher
Compensated Employee with respect to the same Plan Year under Section
3.03.
|
|
(iii)
|
Excess
Contributions to be distributed under this Section 3.04 with respect to a
Higher Compensated Employee shall be adjusted to include any applicable
Trust Fund investment income or loss on such contributions in the
immediately preceding calendar year. The investment income or
loss attributable to the Higher Compensated Employee's Excess
Contributions for the immediately preceding Plan Year shall be determined
by multiplying the income or loss attributable to the Higher Compensated
Employee's Deferrals in such year by a fraction having as its numerator
the Employee's Excess Contributions for such year and having as its
denominator the sum of: (A) the balance in the Higher Compensated
Employee's Deferral Account at the beginning of the immediately preceding
Plan Year, plus (B) the Higher Compensated Employee's Deferrals for such
Plan Year. The distribution shall reduce the Participant's
Deferral Account as of the
|
27
date it
is distributed. The Committee shall establish such rules and give
such timely directions to the Trustee as the Committee, in its sole discretion,
deems appropriate to carry out the provisions of this paragraph.
In the
case of a Higher Compensated Employee whose Actual Deferral Ratio is determined
under the family aggregation rules, the determination of the amount of Excess
Contributions shall be made by combining the Deferrals and Compensation of all
Family Members, the Excess Contributions shall be reduced in accordance with the
method described in subparagraphs (c)(I-iii) above and the Excess Contributions
for the family unit shall be allocated among the Family Members in proportion to
the Deferrals of each Family Member that have been combined to determine the
Actual Deferral Ratio. Effective for Plan Years beginning after December 31,
1996, the aforesaid family aggregation rules shall no longer apply.
|
3.05
|
Limitation on Company
Matching Contributions
|
|
|
(a)
|
Definitions.
|
For
purposes of this Section 3.05, the following terms shall have the following
meanings:
|
|
(i)
|
"Aggregate
Limit" means the greater of:
|
|
|
(A)
|
the
sum of:
|
|
|
(1)
|
one
hundred twenty five percent (125%) of the greater of: (a) the
Actual Deferral Percentage of Lower Compensated Employees for such Plan
Year; or (b) the Contribution Percentage of Lower Compensated Employees
for such Plan Year; and
|
|
|
(2)
|
two
(2) percentage points plus the lesser of (A)(1)(a) or (A)(1)(b); provided,
however, that this amount shall not exceed two hundred percent (200%) of
the lesser of (A)(1)(a) or
(A)(1)(b);
|
or
|
|
(B)
|
the
sum of:
|
|
|
(1)
|
one
hundred twenty five percent (125%) of the lesser of: (a) the Actual
Deferral Percentage of the
Lower
|
28
Compensated
Employees for such Plan Year; or (b) the Contribution Percentage of the Lower
Compensated Employees for the Plan Year; and
|
|
(2)
|
two
(2) percentage points plus the greater of (B)(1)(a) or (B)(1)(b);
provided, however, in no event shall this amount exceed two hundred
percent (200%) of the greater of (B)(1)(a) or
(B)(1)(b).
|
|
|
(ii)
|
"Contribution
Percentage" means, with respect to Higher Compensated Employees and Lower
Compensated Employees for a Plan Year, the average of the ratios
(expressed as percentages), calculated separately for each Employee in the
group applying to him and hereinafter referred to as "Contribution
Percentage Ratio," of the Company Section 3.02 matching contributions on
behalf of the Employee (and Deferrals, if the Company makes a Section
3.05(d) election) for the Plan Year to the Employee's Compensation for the
Plan Year. Notwithstanding the foregoing, if a Higher
Compensated Employee is eligible to participate in two (2) or more plans
of the Company which are subject to Code Section 401(m), the Contribution
Percentage Ratio for the Higher Compensated Employee will be determined by
treating all such plans as a single
plan.
|
If,
during the Determination Year or Look-Back Year, an individual employed by the
Company is an Employee and is a Family Member of either a Five Percent Owner, or
a Higher Compensated Employee who is one of the ten (10) most Highly Compensated
Employees of the Company (ranked on the basis of Compensation paid by the
Company during such year), the Contribution Percentage Ratio for the Five
Percent Owner or Higher Compensated Employee and such Family Member (who
together shall be treated as one Higher Compensated Employee) must be determined
by combining the Company Section 3.02 matching contributions, (and Deferrals, if
the Company makes a Section 3.05(d) election) and Compensation of all Family
Members. Except to the extent taken into account in the immediately
preceding sentence, the Company Section 3.02 matching contributions, (and
Deferrals, if the Company makes a Section 3.05(d) election) and Compensation of
all Family Members are disregarded in determining the Contribution Percentage
for the groups of Higher Compensated Employees and Lower Compensated Employees.
Effective for Plan Years beginning after December 31, 1996, the aforesaid family
aggregation rules shall no longer apply.
The
Company's Section 3.02 matching contribution will be taken into account in
determining a Participant's Contribution Percentage Ratio for a Plan Year only
if such contribution is made on account of the
29
Participant's
Deferrals for the Plan Year, is (under the terms of the Plan) allocated to the
Participant's applicable account as of a date within that year, and is actually
paid to the Trust by no later than the twelfth (12th) month following the close
of that year. Qualified matching contributions which are used to meet
the requirements of Code Section 401(k)(3)(A) are not to be taken into account
for purposes of Section 3.05(a).
|
|
(iii)
|
"Determination
Year" means the Determination Year defined in Section
3.04.
|
|
|
(iv)
|
"Company"
means, for purposes of this Section 3.05, the Company defined in Section
3.04.
|
|
|
(v)
|
"Excess
Aggregate Contributions" mean the amount of the Company Section 3.02
matching contributions on behalf of Higher Compensated Employees (and
Deferrals of Higher Compensated Employees, if the Company makes a Section
3.05(d) election) for a Plan Year that causes the Contribution Percentage
for the group to exceed the limits allowed by Sections 3.05(b) and (if
applicable) 3.05(c).
|
|
|
(vi)
|
"Excess
Contributions" mean the contributions defined in Section
3.04.
|
|
|
(vii)
|
"Excess
Deferrals" mean the Deferrals defined in Section
3.03.
|
|
|
(viii)
|
"Family
Member" means the Family Member defined in Section
3.04.
|
|
|
(ix)
|
"Higher
Compensated Employees" mean the Higher Compensated Employees defined in
Section 3.04.
|
|
|
(x)
|
"Look-Back
Year" means the Look-Back Year defined in Section
3.04.
|
|
|
(xi)
|
"Lower
Compensated Employees" mean the Lower Compensated Employees defined in
Section 3.04.
|
|
|
(b)
|
401(m)
Nondiscrimination Test.
|
Each Plan
Year the Company Section 3.02 matching contributions on behalf of Participants
(and Deferrals, if the Company makes a Section 3.05(d) election) shall satisfy
one of the following tests or any other test which might be prescribed under
Code Section 401(m):
30
|
|
(i)
|
The
Contribution Percentage for Higher Compensated Employees shall not exceed
the Contribution Percentage for Lower Compensated Employees multiplied by
1.25; or
|
|
|
(ii)
|
The
Contribution Percentage for Higher Compensated Employees shall not exceed
2 multiplied by the Contribution Percentage for Lower Compensated
Employees; and the excess of the Contribution Percentage for Higher
Compensated Employees over the Contribution Percentage for Lower
Compensated Employees shall not exceed 2 percentage
points.
|
Notwithstanding
the foregoing provisions of this subsection, effective for the Plan Years
beginning after December 31, 1996, the Compensation Percentage for Lower
Compensated Employees that shall, except as provided in the following sentence,
be used in applying the tests set forth in this subsection for a Determination
Year shall be the Compensation Percentage for Lower Compensated Employees in the
Determination Year. The Company may elect (in a manner consistent
with guidance prescribed by the Internal Revenue Service; provided such guidance
is issued) to use, when applying the tests set forth in this subsection, the
Compensation Percentage of Lower Compensated Employees in the
Look-Back Year rather than that of the Determination
Year. Pursuant to the two foregoing sentences, in the Plan
Years beginning January 1, 1997, 1998, 1999, 2000 and 2001, the Company elected
to utilize the ACP of Lower Compensated Employees in the Determination
Year.
|
|
(c)
|
Multiple
Use.
|
For Plan
Years beginning after December 31, 1988, if the sum of all Higher Compensated
Employees' Actual Deferral Percentage and Contribution Percentage exceeds the
Aggregate Limit, then the Contribution Percentage of Higher Compensated
Employees shall be reduced in the manner set forth in Section 3.05(e) so that
the Aggregate Limit is not exceeded. The Actual Deferral Percentage
and the Contribution Percentage of Higher Compensated Employees are determined
after any corrections required to meet the tests set forth in Sections 3.04(b),
3.05(b) and (if applicable) 3.05(c). Multiple use does not occur if
both the Actual Deferral Percentage and the Contribution Percentage of Higher
Compensated Employees do not exceed 1.25 multiplied by the Actual Deferral
Percentage and the Contribution Percentage of Lower Compensated
Employees.
The
multiple use test described in Treasury Regulation section 1.401(m)-2 and in
this subsection shall not apply for Plan Years beginning after December 31,
2001.
31
|
|
(d)
|
Company
Election
|
In
computing the Contribution Percentage, the Company, in accordance with Treasury
Regulation Section 1.401(m)-1(b)(5), may, to the extent allowed by such
regulation, elect to use Deferrals in determining the Contribution
Percentage. The Committee shall establish such rules and give such
directions to the Trustee as shall be appropriate to carry out Section
3.05(c).
|
|
(e)
|
Treatment of Excess
Aggregate Contributions.
|
If the
limits in Sections 3.05(b) and (if applicable) 3.05(c) are exceeded in any Plan
Year, the following provisions shall apply:
|
|
(i)
|
In
the event that the Company Section 3.02 matching contributions (and
Deferrals, if the Company makes a section 3.05(d) election) allocated to
Higher Compensated Employees for any Plan Year result in Excess Aggregate
Contributions, the Committee shall direct the Trustee to distribute the
Excess Aggregate Contributions, adjusted for any applicable Trust Fund
investment income or loss thereon, to the Higher Compensated Employees
with the highest Contribution Percentage, if they are Vested in the
amounts, by March 15 following the Plan Year in which the Excess Aggregate
Contributions occurred but in no event later than the close of the Plan
Year following the Plan Year in which the Excess Aggregate Contributions
occurred. If the affected Higher Compensated Employees are not
Vested in such amounts, the Committee shall direct the Trustee to treat
the nonvested portion of the Excess Aggregate Contributions as a
forfeiture (allocable to the Plan Year in which the Excess Aggregate
Contributions occurred) and allocate them according to the rules in
Section 6; provided, however, that no amount of the forfeited Excess
Aggregate Contributions shall be allocated to a Higher Compensated
Employee whose share of Company Section 3.02 matching contributions (and
Deferrals, if the Company makes a Section 3.05(d) election) is adjusted
under this Section 3.05.
|
To
determine the portion of the Excess Aggregate Contributions to be distributed
to, or forfeited by, each Higher Compensated Employee, the Committee shall
direct the Trustee to distribute, or cause to be forfeited, the Company Section
3.02 matching contributions (and Deferrals, if the Company makes a Section
3.05(d) election) allocated to the Higher Compensated Employee for the Plan Year
in which the Excess Aggregate Contributions occurred to the extent necessary to
prevent the Contribution Percentage for the group of Higher Compensated
Employees from exceeding the permissible Contribution Percentage for the
group.
32
The
Committee shall direct the Trustee to make the distribution, or cause the
forfeiture to be made, on a uniform basis. It shall first be made
with respect to the Higher Compensated Employee with the highest Contribution
Percentage for the Plan Year and then with respect to the Higher Compensated
Employee with the next highest Contribution Percentage for the Plan Year and so
on, in descending order from the highest rate until the tests in Section 3.05(b)
and (if applicable) 3.05(c) are satisfied. For the purpose of this
subparagraph, the phrase “Contribution Percentage” shall for Plan Years
beginning after December 31, 1996, refer to the dollar amount of contributions
that are considered in determining a Participant’s Contribution Percentage, and
for Plan Years beginning before January 1, 1997, shall mean a Participant’s
Contribution Percentage Ratio.
The
portion of the Vested Excess Aggregate Contributions applicable to each Higher
Compensated Employee shall be distributed to the Higher Compensated Employee in
a single payment. If the Company has elected under Section 3.05(d) to
count Deferrals in the determination of Excess Aggregate Contributions, the
portion of the Excess Aggregate Contributions applicable to each Higher
Compensated Employee that is to be distributed or forfeited in accordance with
this Section 3.05 shall be reduced by any Excess Deferrals and Excess
Contributions previously distributed to the Higher Compensated Employee with
respect to the same Plan Year under Sections 3.03 and 3.04.
|
|
(ii)
|
Excess
Aggregate Contributions to be distributed or forfeited under this Section
3.05 with respect to a Higher Compensated Employee shall be adjusted to
include any applicable Trust Fund investment income or loss
thereon. The investment income or loss attributable to the
Higher Compensated Employee's Excess Aggregate Contributions for the
immediately preceding Plan Year, shall be the income or loss allocable to
the Higher Compensated Employee's Company Matching Contributions Account,
(and Deferral Account, if the Company makes a Section 3.05(d) election) to
the extent there is a distribution or forfeiture attributable to said
Accounts multiplied by a fraction: (A) the numerator of which
is the Higher Compensated Employee's Excess Aggregate Contributions for
the immediately preceding Plan Year; and (B) the denominator of which is
the sum of: (I) the balance in such accounts at the beginning
of the immediately preceding Plan Year; plus (ii) the Company Section 3.02
Matching Contributions and, if applicable, the Participant's Deferrals if
the Company makes a Section 3.05(d) election, for such Plan
Year. The distribution
or
|
33
forfeiture
shall reduce the Participant's Company Matching Contribution Account, (and
Deferral Account, if the Company makes a Section 3.05(d) election) as of the
date it is distributed or forfeited, to the extent there is a distribution or
forfeiture attributable to said Accounts. The Committee shall
establish such rules and give such timely directions to the Trustee as the
Committee, in its sole discretion, deems appropriate to carry out the provisions
of this paragraph.
|
|
(iii)
|
If
the Higher Compensated Employee's Compensation Percentage Ratio is
determined by combining the Company Section 3.02 matching contributions,
(and Deferrals, if the Company makes a Section 3.05(d) election) and
Compensation of all Family Members, the Excess Aggregate Contributions
shall be reduced in accordance with the method described in subparagraphs
(e)(i) through (e)(ii) above and the Excess Aggregate Contributions for
the family unit shall be allocated among the Family Members in proportion
to the Company Section 3.02 matching contributions (and Deferrals, if the
Company makes a Section 3.05(d) election) of each Family Member that are
combined to determine the Contribution Percentage Ratio. Effective for
Plan Years beginning after December 31, 1996, the aforesaid family
aggregation rules shall no longer
apply.
|
|
3.06
|
Limitation on Annual
Additions
|
|
|
(a)
|
Basic
Limitation
|
Notwithstanding
any provisions of this Plan to the contrary, the Annual Additions allocated to
any Participant's Accounts for a Plan Year will not exceed the lesser of (i)
twenty-five percent (25%) of the Participant's Compensation paid in such year,
or (ii) $30,000, or, if greater, twenty-five percent (25%) of the dollar
limitation in effect under Code Section 415(c)(1)(A) as adjusted by Code Section
415(d).
For
purposes of this Section, "Annual Additions" means the total amount of Company
Matching Contributions, Participant Deferrals, Participant after-tax
contributions, if any, and forfeitures, if any, allocated to the Participant's
Accounts during the Plan Year.
For Plan
Years beginning before January 1, 2002, and notwithstanding any provision of
this Plan to the contrary, the Annual Additions allocated to any Participant’s
Accounts for a Plan Year will not exceed the lessor of (i) twenty-five percent
(25%) of the Participant’s Compensation paid in such years, or (ii) $30,000, or,
if greater, twenty-five percent (25%) of the dollar limitation in effect under
Code Section 415(c)(1)(A) as adjusted by Code Section 415(d).
34
For Plan
Years beginning after December 31, 2001, and notwithstanding any provisions of
this Plan to the contrary (except to the extent permitted under Section 3.03(b)
of the Plan and Code Section 414(v)), the Annual Additions that may be
contributed or allocated to any Participant’s Accounts for a Plan Year will not
exceed the lessor of (i) $40,000, as adjusted for increases in the
cost-of-living under Code Section 415(d), or (ii) one-hundred percent (100%) of
the Participant’s Compensation, within the meaning of Code Section 415(c)(3)
within such years.
The
one-hundred percent (100%) Compensation limit referred to herein shall not apply
to any contribution for medical benefits after separation from service (within
the meaning of Code Sections 401(h) or 419A(f)(2)) which is otherwise treated as
an annual addition.
For
purposes of this Section, “Annual Additions” means the total amount of Company
Matching Contributions, Participant Deferrals, Participant after-tax
contributions, if any, and forfeitures, if any, allocated to the Participant’s
Accounts during the Plan Year, without regard to any rollover contribution as
delineated in Code Section 415(c)(2).
|
|
(b)
|
Participation in Other
Defined Contribution Plans
|
The
limitation of this Section 3.06 with respect to any Participant who at any time
has participated in any other qualified defined contribution plan (as defined in
ERISA Section 3(34) and Code Section 414(I)) maintained by an Affiliated Company
will apply as if the total contributions allocated under all such defined
contribution plans in which the Participant has participated were allocated
under one Plan.
|
|
(c)
|
Participation in this
Plan and Defined Benefit
Plan
|
If a
Participant has been a Participant in a qualified defined benefit plan (as
defined in ERISA Section 3(35) and Code Section 414(j)) maintained by an
Affiliated Company, the sum of the Participant's Defined Benefit Plan Fraction
and Defined Contribution Plan Fraction for any year will not exceed
1. For purposes of this subsection (c) only, the following words and
phrases have the meanings specified below:
|
|
(i)
|
“Defined
Benefit Plan Fraction” for any Plan Year means a fraction where the
numerator is the Participant's Projected Annual Benefit, as defined below,
as of the end of the year and the denominator is the lesser of one and
twenty-five hundredths multiplied by the dollar limitation in effect under
Code Section 415(b)(1)(A) for such Plan Year or one and four-tenths
multiplied by 100 percent of the Participant's average annual Compensation
for the highest 3 consecutive calendar Years of
Participation.
|
35
|
|
(ii)
|
“Defined
Contribution Plan Fraction” for any Plan Year means a fraction, not to
exceed one, where the numerator is the sum of all Annual Additions made on
behalf of the Participant to his Accounts in such Plan Year and for all
previous Plan Years, and the denominator is the sum of the lesser of (A)
or (B) determined for such Plan Year and for each previous Plan Year
during which the Participant was employed by the Affiliated
Company:
|
|
|
(A)
|
One
and twenty-five hundredths multiplied by the dollar limitation in effect
under Code Section 415(c)(1)(A) for such Plan
Year.
|
|
|
(B)
|
One
and four-tenths multiplied by twenty-five percent of the Participant's
Compensation in such Plan Year.
|
|
|
(iii)
|
“Participant's
Projected Annual Benefit” means the annual benefit to which the
Participant would be entitled under all Affiliated Company-sponsored
defined benefit plans, assuming the Participant continues employment until
Normal Retirement Date; the Participant's Compensation continues until
Normal Retirement Date at the rate in effect during the current calendar
year; and all other factors relevant for determining benefits under the
Plan remain constant at the level in effect during the current calendar
year.
|
In the
event that the Participant's Defined Benefit Plan Fraction and Defined
Contribution Plan Fraction for any Plan Year exceed one, adjustments will be
made by first reducing the amount in the numerator of the Defined Benefit Plan
Fraction, to the extent possible, and then by reducing the amount in the
numerator of the Defined Contribution Plan Fraction.
Effective
for Plan Years beginning after 1999, the provisions of this subsection (c) shall
no longer apply.
|
|
(d)
|
Treatment of Excess
Annual Additions
|
If as a
result of an allocation of forfeitures, a reasonable error in estimating a
Participant's Compensation, a reasonable error in determining a Participant's
Deferrals, or other facts and circumstances that the Internal Revenue Service
finds justifies the availability of this Section 3.06(d), the Annual Additions
allocated to a Participant's Accounts for any Plan Year exceed the limitation in
Section 3.06(a), the following provisions shall apply:
|
|
(i)
|
First,
amounts attributable to the Participant's Unmatched Deferrals, and if
necessary, his Matched Deferrals, will be reduced. Such amounts
will be returned to the Company employing the
Participant,
|
36
solely
for the purpose of enabling the Company to withhold any federal, state, or local
taxes due on such amounts. The Company will pay all remaining amounts
to the Participant.
|
|
(ii)
|
Second,
the Company Matching Contribution allocated to the Participant's Company
Matching Contributions Account will be reduced. The amount of
the reduction will be allocated and reallocated to other Participants who
have made deferrals in such year.
|
|
|
(iii)
|
If,
however, the reallocation to other Participants in the Plan pursuant to
subparagraph (ii) above of the excess amounts (and net earnings
attributable to the excess amounts) causes the limitation contained in
Section 3.06(a) to be exceeded with respect to every Participant for the
Plan Year, the Committee shall direct the Trustee to hold the excess
amounts unallocated in a suspense account for the Plan Year and to
allocate and reallocate the excess amounts during the next Plan Year
(subject to the limitation set forth in Section 3.06(a)) to all the
Participants in the Plan in such Plan Year, before any Company Section
3.02 matching contributions or Section 6 forfeitures may be made to the
Plan for that Plan Year. If a suspense account is in existence
at any time during a Plan Year, investment gains or losses of the Trust
Fund will not be allocated to the suspense
account.
|
|
|
(iv)
|
The
excess amounts that are to be distributed to, or forfeited by, each
Participant in accordance with this Section 3.06 shall be reduced by any
Excess Deferrals, Excess Contributions and Excess Aggregate Contributions
previously distributed to the Participant with respect to the same Plan
Year under Sections 3.03, 3.04, and
3.05.
|
|
|
(e)
|
The
determination of the limitation on Annual Additions described in this
Section 3.06 will be made considering the Employees of all Affiliated
Companies as employed by a single employer. Such determination
will be made assuming the phrase, “more than fifty percent” is substituted
for the phrase “at least eighty percent” each place it appears in Code
Section 1563(a)(1).
|
|
3.07
|
Allocation of
Forfeitures
|
Amounts
forfeited pursuant to Section 6.05 will, except as otherwise provided in the
Plan, be allocated quarterly, to Participants who are active or suspended as of
the last day of the calendar quarter for which the forfeitures are being
allocated. Such forfeitures will be allocated to the Company Matching
Contributions Account of such Participants by the fifteenth (15th) of the month
following each quarter end. The amount to be allocated, if
administratively practicable, will bear the same ratio to the
37
total
forfeitures for such calendar quarter as the Participant’s Company
Matching
Contributions
for the calendar quarter bear to the Company Matching Contributions of all
Participants for the calendar quarter.
|
3.08
|
Rollover
Contributions
|
Effective
January 1, 1993, the Committee shall decide whether to accept a transfer of
assets from a Code Section 401(a)(31) eligible retirement plan with respect to a
person who is or is about to become a Participant in this Plan, provided the
transfer of such assets to this Plan qualifies as a direct or sixty (60) day
rollover of a Code Section 401(a)(31)(C) eligible rollover
distribution.
After
December 31, 2001, the Committee shall decide whether to accept rollover
distributions from Code Sections 401(a) and 403(a) qualified plans, Code Section
403(b) annuity contracts, and Code Section 457(b) eligible plans maintained by a
state, political subdivision of a state, or any agency or instrumentality of a
state or a political subdivision of a state with respect to a person who is or
is about to become a Participant in this Plan, provided the transfer of such
assets to this Plan qualifies as a direct or sixty (60) day rollover under the
provisions of Code Section 401(a)(31).
The
Committee shall require the Participant to provide reasonable evidence that any
such amount meets the above requirements. Failure of the Participant
to provide such evidence will preclude the Plan's acceptance of any such
amount. Furthermore the Plan shall not be required to accept any
transfer from another qualified plan.
The
Committee may establish other uniform rules and procedures, consistent with the
requirements of the Code and this Section 3.08, concerning the acceptance of
rollover contributions, including rules that limit or prohibit wire transfers
and other payments that are made directly to this Plan from another Plan in lieu
of having the Participant receive a check payable to this Plan's Trustee for
delivery to a Plan representative who is authorized to receive rollover
contributions.
|
3.09
|
Employer
Error
|
If the
Company makes an incorrect Section 3.02 matching contribution on behalf of a
Participant as a result of an error by the Company, then, notwithstanding
Section 3.02, the Company shall increase or decrease Section 3.02 matching
contributions to the Participant's Company Matching Contributions Account within
a reasonable time after discovery of the error to the extent necessary, and
allowed by law, to correct the error as long as the Section 3.02 matching
contributions when averaged over the Plan Year equal the amount of contributions
required under Section 3.02. The Section 3.02 matching contributions
shall be adjusted for earnings or losses which would have accrued to the
Participant>s Company Matching Contributions
38
Account
if the correct Section 3.02 matching contribution had been made. Alternatively,
the Company may recover from the Trust Fund a Section 3.02 matching contribution
made as a result of a mistake of fact if the requirements of the Trust are
satisfied.
If the
Company makes an incorrect Deferral on behalf of Participant as a result of an
error by the Company, then, notwithstanding the percentage limitations set forth
in Section 3.01, the Participant may elect to increase or decrease his or her
Deferrals to the extent necessary to correct the error as long as his or her
Deferrals when averaged over the Plan Year do not exceed the percentage
limitations set forth in Sections 3.01. The Deferrals made pursuant
to this Section 3.09 shall not be adjusted for earnings or losses which would
have accrued to the Participant's Accounts if the correct deposit had been
made.
If the
Company makes an incorrect Section 3.07 forfeiture allocation on behalf of a
Participant as a result of an error by the Company, then, notwithstanding
Section 3.07, the Company shall increase or decrease Section 3.07 forfeiture
allocation to the Participant's Company Matching Contributions Account within a
reasonable time after discovery of the error to the extent necessary, and
allowed by law, to correct the error. The Section 3.07 forfeiture
allocation shall be adjusted for earnings or losses which would have accrued to
the Participant's Company Matching Contributions Account if the correct Section
3.07 forfeiture allocation had been made. Alternatively, the Company
may recover from the Trust Fund a Section 3.07 forfeiture allocation made as a
result of a mistake of fact if the requirements of the Trust are
satisfied.
Notwithstanding
the foregoing, any Deferrals and Company Section 3.02 matching contributions
made pursuant to this Section 3.09 shall be subject to the limitations set forth
in Sections 3.03, 3.04, 3.05, and 3.06. Furthermore, any Company
Section 3.07 forfeiture allocation made pursuant to this Section 3.09 shall be
subject to the limitations set forth in Section 3.06.
|
3.10
|
Inclusion of
Ineligible Employee
|
If, in
any Plan Year, a non Eligible Employee is erroneously included as a Participant
in the Plan and discovery of such erroneous inclusion is not made until after a
Deferral for the Plan Year has been made, the Company may, if allowed by law,
recover the Deferral, and any earnings thereon, from the Trust Fund and refund
it to such Employee, when a distributable event under Code Section 401(k)
occurs. The Company may recover a Section 3.02 matching contribution
or a Section 3.07 forfeiture allocation from the Trust Fund if and only if the
requirements of the Trust are satisfied.
ARTICLE
4
INVESTMENT OF CONTRIBUTIONS
AND
39
VALUATION OF
ACCOUNTS
|
4.01
|
Participants'
Accounts
|
The
Committee will establish and maintain in the name of each Participant a Company
Matching Contributions Account, a Deferral Account, a Frozen After Tax Account,
and a Rollover Account. A Participant's Accounts will be credited
with contributions and forfeitures, charged with withdrawals and distributions,
and adjusted for investment results as determined under the Plan and otherwise
as set forth in the Plan.
|
4.02
|
Investment
Funds
|
Upon
enrollment or reenrollment, each Participant will have his Accounts invested in
the Trust Fund. The Trust Fund will consist of those Investment Funds
described in Schedule A attached to this Plan and incorporated as part of the
Plan. Each Participant will have the right upon enrollment,
reenrollment, and during participation, to elect the Investment Fund(s) under
which future contributions to his Deferral Account, Rollover Account and Frozen
After Tax Account will be invested, by making such election through the Voice
Response System or in such other manner as is allowed by the Committee from time
to time. The election will include the percentage, subject to the
restrictions in Schedule A, of future contributions to be invested in each
Investment Fund, with the total of the percentages equal to one hundred percent
(100%). Such election for future contributions will be effective as
soon as administratively practicable on or after the Business Day such election
is received by the Voice Response System or by the Committee and/or its designee
if the Committee creates an alternative method of making such
elections.
In
addition, each Participant will also have the right to have all or any part of
his Deferral Account, Rollover Account or Frozen After Tax Account transferred
among and between the Investment Fund(s), subject to the restrictions set forth
in Schedule A, by making such election through the Voice Response
System. Transfers in a Participant’s Accounts will take place as soon
as administratively practicable on or after the Business Day such election is
received by the Voice Response System. The Committee may create
alternative rules allowing for such transfers.
Except
for Participant Deferrals invested in Employer Securities and as provided in
Section 4.03 below, the Committee will exercise voting, tender, and other rights
with respect to the Investment Funds.
|
4.03
|
Investment of Company
Matching Contributions and Voting of Company
Stock
|
40
All
Company Matching Contributions shall be primarily invested in the Southwest Gas
Stock Fund, and shall be a part of the Employee Stock Ownership
Plan. Such
contributions
shall be based on the fair market value of the Company Stock at the time
contributed by the Company or purchased by the Trustee from the Company, in the
open market, or in privately negotiated transactions. However, upon
reaching age fifty (50), a Participant may elect the Investment Fund(s) in which
the present balance of his Company Matching Contributions Account, as well as
all future contributions to his Company Matching Contributions Account, will be
invested, using the procedures and following the timing for a transfer of a
Participant's Account set forth above in Section 4.02.
This Plan
may acquire and hold qualifying securities of the Company. If all or
part of a Participant's Company Matching Contribution Account or other accounts
is invested in Employer Securities, such Participant shall be entitled to the
voting rights based on the value of such stock in his Account. The
Trustee will vote the Company Stock that is not voted by Participants in the
same ratio that the stock is voted by the Participants who exercised their
voting rights. The Committee, in a nondiscriminatory manner, will
make any other necessary decisions arising out of the acquisition or holding of
Employer Securities.
|
4.04
|
Allocation of
Investment Income on a Valuation
Date
|
All
determinations of a Participant's Account balances shall be based on the value
as of the last available or coincident Valuation Date. Accounts are
debited and credited on the actual date of a transaction. Dividends
and interest are posted on the date declared. Realized gains and
losses are debited or credited at the time of the transaction (i.e., exchanges,
withdrawals).
|
4.05
|
Limitation on
Participant Investment
Instructions
|
Notwithstanding
anything else in this Plan to the contrary, the Committee will, unless in its
discretion it determines otherwise, decline to carry out a Participant's
investment instructions if such instructions:
|
|
*
|
Would
result in a prohibited transaction described in ERISA Section 406 or Code
Section 4975;
|
|
|
*
|
Would
generate income that would be taxable to the
Plan;
|
|
|
*
|
Would
not be in accordance with the Plan;
|
|
|
*
|
Would
cause a fiduciary to maintain the indicia of ownership of any Plan assets
outside the jurisdiction of the district courts of the United States other
than as permitted by ERISA Section 404(b) and 29 CFR
2550.404b-1;
|
41
|
|
*
|
Would
jeopardize the Plan's tax qualified status under the Code;
or
|
|
|
*
|
Could
result in a loss in excess of a Participant's or Beneficiary's account
balance.
|
Furthermore,
notwithstanding any language in this Plan to the contrary, the Committee may
establish any and all rules and regulations it deems necessary to provide and
allow for a change in Plan record keeper, and/or Trustee, or a change in
Investment Funds, as determined by the Committee, that are available to Plan
Participants. Such rules and regulations may include, but not be
limited to, limits or prohibitions, during specified time periods, on the
availability of Participant enrollments, withdrawals, distributions, loans,
rollover contributions, Investment Fund transfers, and/or changes in Deferral
elections.
ARTICLE
5
WITHDRAWALS, LOANS AND
QUALIFIED
DOMESTIC RELATIONS
ORDERS
|
5.01
|
Withdrawal of Frozen
After Tax Contributions
|
Through
the Voice Response System, a Participant may withdraw, in cash, from his Frozen
After Tax Account a minimum of five hundred dollars ($500) or one hundred
percent (100%) of the value of his Frozen After Tax Account, if less, as of the
date of the request. Only Participants who are ERISA Section 3(14)
parties in interest can request and receive such
withdrawal. Withdrawals from a Participant's Frozen After Tax Account
will be first withdrawn from pre-1987 voluntary contributions and the remainder
thereafter from pre-1987 earnings and post-1986 earnings.
Withdrawals
will be processed as soon as administratively practicable on or after the
Business Day the request for withdrawal is received by the Voice Response
System. A Participant will be permitted to make such a withdrawal
once in any twelve (12) month period.
|
5.02
|
Withdrawal of Company
Matching Contributions
|
Through
the Voice Response System, a Participant may withdraw, in a cash lump sum
distribution, or Section 7.03 eligible rollover distribution, from his Company
Matching Contributions Account a minimum of five hundred dollars ($500) or one
hundred percent (100%) of the value of his Company Matching Contributions
Account, if less, as of the date of the request. Only Participants
who are ERISA Section 3(14) parties in interest can request and receive such
withdrawal. A Participant will be permitted to make such a
withdrawal only if he has previously withdrawn all amounts available to him in
accordance with section 5.01 and only if
42
his
Company Matching Contributions Account is one hundred percent (100%)
vested. A Participant will be permitted to make such a withdrawal
once in any twelve (12) month period.
|
5.03
|
Loans to
Participants
|
|
|
(a)
|
A
Participant may request, and if eligible, receive a loan through the Voice
Response System. Only Participants who are ERISA Section 3(14)
parties in interest can request and receive a Plan
loan.
|
|
|
(b)
|
The
loan request will be reviewed to comply with the provisions of the Plan
and ERISA and according to a uniform nondiscriminatory policy for approval
of loan applications (which policy may be changed from time to time as the
Committee may deem appropriate and will supersede the terms of this
Section 5.03, if inconsistent therewith). A Participant will
only be able to borrow from his Deferral Account. The loan
request must be for an amount at least equal to one thousand dollars
($1,000) and shall not, when added to the outstanding balance of all other
loans from the Plan to the Participant, exceed the lesser
of:
|
|
|
(i)
|
$50,000,
reduced by the excess (if any) of (1) the highest outstanding balance of
loans from the Plan (and any qualified plan of the Company or an
Affiliated Company) during the 12 months ending on the day before the date
on which the loan was made over (2) the outstanding balance of loans from
the Plan (and any qualified plan of the Company or an Affiliated Company)
on the date on which the loan was made,
or
|
|
|
(ii)
|
one-half
the value of the Vested portion of the Participant's
Accounts.
|
|
|
(c)
|
The
Participant shall pledge no more than one-half (2) of the value of the
then Vested portion of his Plan Accounts as security for the repayment of
the loan.
|
|
|
(d)
|
The
Participant's endorsement on the loan check shall evidence his obligation
to repay his loan from the Plan.
|
|
|
(e)
|
With
respect to any loan, the Participant shall execute a consent to the
repayment of his loan by withholding payroll and the Company shall pay to
Trustee the withheld amount.
|
|
|
(f)
|
Installment
payments on a Plan loan shall be made not less frequently than as payroll
is paid to the borrowing Participant, and in all circumstances not less
frequently than quarterly, in installments of principal and
interest.
|
43
|
|
(g)
|
No
Plan loan shall extend over a period greater than five (5)
years.
|
|
|
(h)
|
Interest
shall be charged on any Plan loan at a rate equaling two percent (2%) plus
the prime rate of interest. The prime rate of interest shall be
the prime rate published in the Wall Street Journal, updated on the last
Business Day of the last quarter prior to the making of the
loan.
|
|
|
(i)
|
In
the event the Participant fails to repay all or any portion of Plan loan
or loans when the same become due and payable, the loan shall be in
default and the Trustee may (in addition to any other legal remedies the
Trustee may have) when a distribution event occurs, deduct the unpaid
amount of such loan, plus accrued interest thereon, from the Vested
portion of the Participant's Plan
Accounts.
|
|
|
(j)
|
A
Participant shall receive a Plan loan only if he satisfies all applicable
requirements of this Section 5.03.
|
|
|
(k)
|
The
Trustee shall send legally required truth-in-lending disclosures with all
loans issued.
|
|
|
(l)
|
If
a Participant requests and is granted a loan, a loan check will be
generated directly from the Participant's Accounts. Except for
Participants that are subject to the provisions of Section 16 of the
Securities Exchange Act of 1934, as amended, Participants will not be
permitted to specify the Investment Funds from which the loan is
disbursed.
|
|
|
(m)
|
Principal
and interest payments on a Participant's loan will be deposited directly
to the Participant's Accounts and invested in the Investment Funds
selected pursuant to Section 4.02
above.
|
|
|
(n)
|
A
Participant may only have one loan of the type described in subparagraph
(b) above outstanding at any one
time.
|
|
|
(o)
|
A
Participant may prepay the entire outstanding loan balance in respect to
any loan at any time without
penalty.
|
|
|
(p)
|
If
the Trustee determines that a financing statement, or any other document,
should be filed under the Uniform Commercial Code the Trustee shall make
such filing.
|
|
5.04
|
Hardship
Withdrawals
|
|
|
(a)
|
Hardship Withdrawal
Administrative Rules.
|
44
Subject
to the approval of the Committee, a Participant may be permitted to withdraw
from the Participant's Deferral Account to meet the financial
hardship. Only Participants who are ERISA Section 3(14) parties in
interest can request and receive such withdrawal. The withdrawal will
be divided among the Investment Funds in the same proportion as the
Participant's Deferral Account is invested in the Investment Funds. A
Participant may not withdraw any interest earned on his Deferral
Account. The Committee shall establish rules for determining the
value of the Participant's Deferral Account when a hardship withdrawal is
requested.
|
|
(b)
|
Hardship Withdrawal
Conditions to be Met.
|
The
Committee will determine, in a nondiscriminatory manner, and in accordance with
applicable Treasury Regulations, whether a Participant has a financial
hardship. A distribution may be made on account of financial hardship
if the distribution is necessary in light of immediate and heavy financial need
of the Participant and if such distribution is necessary to satisfy the
need.
|
|
(i)
|
A
distribution will be deemed to be on account of “immediate and heavy
financial need” if it is required
for:
|
|
|
(A)
|
Code
Section 213(d) medical expenses previously incurred by the Participant,
the Participant's Spouse, or the Participant's Code Section 152 dependents
or necessary for these persons to obtain Code Section 213(d) medical
care;
|
|
|
(B)
|
The
purchase (excluding mortgage payments), but not the construction, repair,
remodeling, refinancing, or leasing of the Participant's principal
residence;
|
|
|
(C)
|
The
payment of tuition and related educational fees for the next twelve (12)
months of post-secondary education for the Participant, the Participant's
Spouse, or the Participant's children or other Code Section 152
dependents;
|
|
|
(D)
|
The
need to prevent the eviction of the Participant from his or her principal
residence or the foreclosure of the mortgage on the Participant's
principal residence; or
|
|
|
(E)
|
Such
other events that the Commissioner of the Internal Revenue Service
specifies, through the publication of revenue rulings, notices, and other
documents of general availability, as giving rise to a deemed immediate
and heavy financial need.
|
45
|
|
(ii)
|
The
withdrawal described in subparagraph (I)
must:
|
|
|
(A)
|
Be
in an amount not exceeding the amount of the need arising under
subparagraph (I); the amount of an immediate and heavy financial need may
include any amounts necessary to pay federal, state, or local income taxes
or penalties reasonably anticipated to result from the
distribution;
|
|
|
(B)
|
Not
be made until the Participant has obtained all withdrawals (including the
election to receive dividends under Article 14), other than hardship
withdrawals, and all nontaxable loans (determined at the time of the loan)
that are currently available under all qualified and nonqualified plans of
the Company;
|
|
|
(C)
|
Result
in the Participant being suspended from making Deferrals to this Plan, and
all other qualified and nonqualified plans of deferred compensation
maintained by the Company, for one year beginning on the date the
Participant receives a hardship withdrawal, if prior to January 1, 2002,
and for six (6) months if such withdrawal occurs after December 31, 2001;
and
|
|
|
(D)
|
Result
in the reduction of the Participant's maximum Deferrals to this Plan (and
all other plans maintained by the Company), for the Participant's tax year
immediately following the tax year in which the Participant receives a
withdrawal under this Section 5.04, to an amount not in excess of the Code
Section 402(g) limit for such following tax year less the amount of the
Participant's Deferrals for the tax year in which the Participant receives
the hardship withdrawal.
|
|
|
(iii)
|
Time of
Distribution.
|
A
hardship withdrawal application and procedures will be sent to the Participant
as soon as practicable on or after the business day in which the request is
received through the Voice Response System. If the application is not
received and approved within thirty (30) days from the date of request, the
Participant will be required to reactivate his request for a withdrawal through
the Voice Response System. Distribution will be in a single cash
payment; provided, however, if all or part of the distribution is a Section 7.03
Eligible Rollover Distribution, the distribution shall be made in one of the
three following forms that the Participant must elect among:
|
|
(A)
|
A
single cash payment;
|
46
|
|
(B)
|
If
allowed by Section 7.03, a direct rollover of the Eligible Rollover
Distribution; or
|
|
|
(C)
|
If
allowed by Section 7.03, a partial cash payment and a direct rollover of
the remainder of the eligible rollover
distribution.
|
Effective
January 1, 1994, if a distribution is one to which Code Sections 401(a)(11) and
417 do not apply, such distribution may commence less than thirty (30) days
after the notice required under Treasury Regulation Section 1.411(a)-11(c) is
given, provided that:
|
|
(A)
|
The
Committee clearly informs the Participant that the Participant has a right
to a period of at least thirty (30) days after receiving the notice to
consider the decision of whether or not to elect a distribution (and, if
applicable, a particular distribution option);
and
|
|
|
(B)
|
The
Participant, after receiving the notice, affirmatively elects a
distribution.
|
|
|
(iv)
|
Administrative
Burden.
|
A
withdrawal by a Participant shall not impose undue administrative burden upon
the Company, the Trustee or the Committee, or in any way adverse the rights or
interests of other Participants. Undue administrative burden will be
subject to review and determination by the Committee. A Participant
shall not be permitted to make up any amounts withdrawn.
|
5.05
|
Qualified Domestic
Relations Order
|
|
|
(a)
|
Period of
Determination.
|
Pending
its determination of whether a domestic relations order (DRO) is a Qualified
Domestic Relations Order, the Committee shall in its discretion direct the
Trustee to ban any loans or withdrawals from the Participant’s Plan Accounts,
and to separately account for the amounts which would have been payable to the
Alternate Payee during the determination period (described below) if the DRO had
been determined to be a Qualified Domestic Relations Order. Once the
DRO is deemed to be a Qualified Domestic Relations Order, the Committee shall
direct the Trustee to segregate the amount payable to the Alternate Payee into a
separate account. The law provides an 18-month period from the date
on which the DRO requires the first payment to the Alternate Payee for the
Committee to determine if the DRO is a
47
Qualified
Domestic Relations Order. If the Committee determines that the DRO is
not a Qualified Domestic Relations Order or if the issue is not resolved within
the 18-month period, the Committee shall direct the Trustee to pay the separate
account, adjusted for earnings and losses thereon, to the person who would have
been entitled to the amounts if there were no DRO. Any determination
that a DRO is a Qualified Domestic Relations Order made after the close of the
18-month period shall be applied prospectively only.
|
|
(b)
|
Payment. An
Alternate Payee’s interest in the Vested amount in a Participant’s
Accounts, to the extent possible, shall be segregated into a separate
subaccount and distributed in a lump sum or, if all or part of the
distribution is a Section 7.03 Eligible Rollover Distribution and a direct
rollover is allowed by Section 7.03, a direct rollover at the time
specified in the Qualified Domestic Relations Order even when the order
requires payment to be made to the Alternate Payee before the
Participant’s earliest retirement age as defined in Code Section
414(p)(4). Other matters, including the allocation of future
Deferrals, Company Matching Contributions, forfeitures and Trust Fund
earnings or losses to the segregated subaccount, shall be governed by the
procedures adopted by the Committee hereunder and by the terms of the
Qualified Domestic Relations Order; provided, however, that the
Participant’s Accounts, including any segregated subaccount, shall not
receive a greater or lesser aggregate allocation than if the segregated
subaccount had not been established. If the Committee makes a
decision under this Section 5.05 which affects a Participant’s or
Alternate Payee’s Accounts, the Committee Shall notify the Trustee, the
affected Participant and the Alternate
Payee.
|
ARTICLE
6
VESTING OF RETIREMENT
DISABILITY, DEATH,
AND TERMINATION OF
EMPLOYMENT BENEFITS
|
6.01
|
Vesting Due to
Attainment of Normal Retirement Age and Normal Retirement
Benefits
|
The
Company Matching Contributions Account of a Participant will become, if it has
not already done so, one hundred percent (100%) Vested on the date the
Participant attains his Normal Retirement Age. A Participant is
always fully Vested in his Deferral Account, Frozen After Tax Account, and
Rollover Account. A Participant's retirement benefit shall be the
amount credited to his Accounts as of the Valuation Date preceding distribution
of such benefit plus Section 3 contributions to such Accounts on behalf of the
Participant after such Valuation Date.
|
6.02
|
Vesting Due to
Disability and Disability
Benefits
|
48
The
Company Matching Contributions Account of a Participant whose employment with
the Company is terminated because he is Permanently and Totally Disabled will
become, if it has not already done so, one hundred percent (100%) Vested on the
date the Participant's employment terminates due to the Participant becoming
Permanently and Totally Disabled. A Participant is always fully
Vested in his Deferral Account, Frozen After Tax Account, and Rollover
Account. A Participant's disability benefit shall be the amount
credited to his Accounts as of the Valuation Date preceding distribution of such
benefit plus Section 3 contributions to such Accounts on behalf of the
Participant after such Valuation Date.
|
6.03
|
Vesting Due to Death
and Death Benefits
|
The
Company Matching Contributions Account of a Participant whose employment with
the Company is terminated due to death will become, if it has not already done
so, one hundred percent (100%) Vested on the Participant's date of
death. A Participant is always fully Vested in his Deferral Account,
Frozen After Tax Account, and Rollover Account. A Participant's death
benefit shall be the amount credited to his Accounts as of the Valuation Date
preceding distribution of such benefit plus Section 3 contributions to such
Accounts on behalf of the Participant after such Valuation Date.
|
6.04
|
Vesting upon
Termination of Employment and Termination of Employment
Benefits
|
|
|
(a)
|
The
benefit payable under the Plan in the case of a Participant whose
employment with the Company is terminated for any reason other than
described in Sections 6.01, 6.02, or 6.03 will be equal to the sum of (I)
the Vested value of his Accounts on the Valuation Date immediately
preceding payment of such benefits, and (ii) Article 3 subsequent
contributions to the Accounts on behalf of the Participant. The
Vested value of a Participant's Accounts will be equal
to:
|
|
|
(i)
|
The
Participant's Deferral Account value;
plus
|
|
|
(ii)
|
The
Participant's Frozen After Tax Account value;
plus
|
|
|
(iii)
|
The
Participant's Rollover Account value;
plus
|
|
|
(iv)
|
Subject
to Section 14.03 below, the Vested portion of a Participant’s Company
Matching Contributions Account determined as
follows:
|
|
Years
of Service
|
Vested
Percentage
|
|||
|
Less
than 1
|
0%
|
|||
|
1
|
20%
|
|||
|
2
|
40%
|
49
|
3
|
60%
|
|||
|
4
|
80%
|
|||
|
5
and over
|
100%
|
For
purposes of Section 6.04, the term “Year of Service” is a whole year of Service
which is twelve (12) months of Service (thirty (30) days is deemed to be a month
in the case of the aggregation of fractional amounts).
|
6.05
|
Forfeitures
|
The
non-Vested portion of a Participant’s Company Matching Contributions Account, if
any, will be forfeited upon the earlier to occur of (a) the date the Participant
incurs his fifth consecutive one (1) year Period of Severance or (b) the date
that the Vested portion of the Participant’s Company Matching Contributions
Account is paid out according to the following paragraph. If the
Participant is zero percent vested in such account he shall be deemed to have
received a distribution of such vested account balance on the date he terminated
employment with the Company.
Notwithstanding
any other provision of this Plan to the contrary, any such forfeitures will be
applied first to reinstate the forfeited portions of Company Matching
Contributions Accounts of rehired Participants and lost and missing Participants
and Beneficiaries as described in subsections 6.06(a) and 12.06. If
the amount of forfeitures available is insufficient to reinstate the Accounts
required to be reinstated for certain rehired Participants, the Company will
make an additional contribution in an amount required to reinstate such Accounts
fully.
If, upon
Participant’s termination of employment, the Vested amount in his Participant’s
Accounts does not exceed $5,000 (or any other amount as may be established, by
regulations of the Secretary of the Treasury, as the maximum amount that may be
paid out in such event without the Participant’s consent), the Committee shall
direct the Trustee to immediately, or as soon as administratively practicable,
distribute the Accounts, but no later than the close of the second Plan Year
following the Plan Year in which the Participant’s termination of employment
occurred, the then Vested amount in such Accounts to the
Participant. Effective January 1, 2002, the determination as to
whether the Vested amount in a Participant’s Accounts does not exceed $5,000
shall be made without regard to that portion of the Account Balance that is
attributable to rollover contributions (and earnings allocable thereto) within
the meaning of Code Sections 402(c), 403(b)(8), 408(d)(3)(A)(ii), and
457(e)(16). If the then Vested amount in a Participant’s Accounts
exceeds $5,000, without regard to such rollover contributions, the Participant
may request, through the Voice Response System, a distribution of the entire
Vested amount of such Accounts. The Trustee shall distribute the
Accounts as soon as administratively practicable, but no later than the close of
the second Plan Year following the Plan Year in which the Participant’s
termination of
50
employment
occurred. Investment income will continue to be allocated pursuant to
Section 4.04 above to the earlier of the Business Day of or the first Business
Day after the request for distribution is made.
|
6.06
|
Reinstatement of
Forfeited Accounts
|
|
|
(a)
|
With
respect to the Participant who receives a distribution pursuant to Article
6.05 and whose Termination Date occurs before he is one hundred percent
Vested in his Company Matching Contributions Account, the Participant may
repay to the Plan the full amount distributed to him from such Account;
provided, however, that the repayment must occur before the earlier
of: (a) the date five (5) years after the date he is
subsequently re-employed by the Company, or (b) the day the Participant
incurs his fifth (5th) consecutive one (1) year Period of Severance
commencing after the date of the distribution. After such
repayment, the balance in the Participant's Company Matching Contributions
Account shall be adjusted to the value of the balance in his Company
Matching Contributions Account on the date the repaid distribution was
originally made to the Participant. The difference between the
amount repaid by the Participant and the balance in his Company Matching
Contributions Account on the date the repaid distribution was originally
made shall be funded by all unallocated forfeitures incurred in the Plan
Year of repayment to the extent necessary to reinstate the Participant's
Company Matching Contributions Account in full, and to the extent such
forfeitures are inadequate, by additional Company
contributions.
|
|
|
(b)
|
With
respect to a Participant who terminates employment without being one
hundred percent vested in his Company Matching Contributions Account and
who is reemployed after incurring five (5) consecutive one (1) year
Periods of Severance, Years of Service subsequent to his reemployment will
not increase the Vested percentage of the amount in his Company Matching
Contributions Account as of such prior termination of
employment.
|
ARTICLE
7
DISTRIBUTION OF
BENEFITS
|
7.01
|
Form of
Distribution
|
Amounts
distributable pursuant to Article 6 will be distributed as follows:
51
|
|
(a)
|
If
any Investment Fund is invested in whole or in part in common stock of the
Company, distributions from such Investment Fund will be made in full
shares of common stock of the Company plus cash in lieu of any fractional
share. Upon written application to the Committee a Participant
or, if applicable, his Beneficiary may request a single sum payment
entirely in cash.
|
|
|
(b)
|
Distribution
from other Investment Funds will be made in a single sum payment in
cash.
|
|
7.02
|
Timing of
Distributions
|
|
|
(a)
|
Prior
to January 1, 1998 the following rule shall
apply:
|
Subject
to the provisions of subsection (c) below, distributions under the Plan pursuant
to Article 6 will begin as soon as practicable, but not later than sixty (60)
days following the later of the end of the Plan Year in which the Participant
attains age sixty-five (65) or terminates employment. If a
Participant is rehired by the Company before his benefit is distributed by the
Trustee, such Participant will not be entitled to receive the distribution until
he again terminates his employment with the Company.
Effective
January 1, 1998, the following rule shall apply:
Subject
to the provisions of subsection (c) below, distributions pursuant to Article 6
of the Plan will begin as soon as practicable, but not later than April 1
following the end of the Plan Year in which the Participant attains age seventy
and one-half (70 2)
or terminates employment (effective January 1, 2002, terminates employment
includes severance from employment), if later. If a Participant is
rehired by the Company before his benefit is distributed by the Trustee and
subject to the provisions of subsection (c) below, such Participant will not be
entitled to receive the distribution until he again terminates his employment
with the Company.
|
|
(b)
|
If
the Vested value of the Participant’s Accounts exceeds $3,500 dollars
($5,000 effective October 1, 1998) (or any other amount as may, by
regulations of the Secretary of the Treasury, be established as the
maximum amount that may be paid out in such event without the
Participant’s consent), the Participant may request, through the Voice
Response System, a distribution commencing before he attains age sixty
five (65). If a Participant postpones his distribution to age
sixty five (65), he will continue to share in the allocation of investment
income pursuant to Section 4.04 up to the earlier of his Normal Retirement
Age or as soon as administratively practicable on or after the Business
Day on which his request to receive his
nonforfeitable
|
52
Accounts
is received through the Voice Response System. Effective January 1,
2002, the determination as to whether the Vested amount in a Participant’s
Accounts does not exceed $5,000 shall be made without regard to that portion of
the Account Balance that is attributable to rollover contributions (and earnings
allocable thereto) within the meaning of Code Sections 402(c), 403(b)(8),
408(d)(3)(A)(ii), and 457(e)(16).
|
|
(c)
|
Prior
to January 1, 1998, the following rules shall
apply:
|
|
|
(i)
|
An
Eligible Employee who is a Participant and who has attained his Normal
Retirement Age may elect through the Voice Response System to defer
receipt of his distribution to a date not later that April 1 following the
Plan Year in which the Participant attains age 70-1/2. However,
a Participant who elects to defer receipt of benefits may not do so to the
extent that he is creating a death benefit that is more than
incidental.
|
|
|
(ii)
|
Effective
for Plan Years beginning after December 31, 1996, a Participant other than
a Five Percent Owner may defer receipt of his distribution to April 1 of
the Plan Year following the later of (i) the calendar year the Participant
attains 70 2 or (ii) the calendar year in which the Participant
retires. A Participant other than a Five Percent Owner, who has
not retired from Service with the Company, and who is currently receiving
Plan distributions, may, effective in the first Plan Year beginning after
December 31, 1996, request a cessation of such distributions until April 1
of the Plan Year following his
retirement.
|
Effective
January 1, 1998, A Participant who is a Five Percent Owner may only defer
receipt of his distribution to April 1 following the end of the Plan Year in
which the Participant attains age seventy and one-half (70 2), regardless of his
employment status with the Company. A Participant other than a Five
Percent Owner, who has not retired from Service with the Company, and who is
currently receiving Plan distributions, may, effective in the first Plan Year
beginning after December 31, 1996, request a cessation of such distributions
until April 1 of the Plan Year following his retirement.
|
|
(d)
|
The
benefit payable to a Beneficiary will be paid no later than five (5) years
after the Participant's death.
|
|
|
(e)
|
Notwithstanding
anything in this Plan to the contrary, all Plan distributions shall be
determined and made in accordance with Code Section 401(a)(9) and the
Treasury Regulations thereunder including the minimum distribution
incidental benefit requirement of Treasury Regulation Section
1.401(a)(9)-2. Furthermore, notwithstanding any other provision
of this Plan to the contrary,
|
53
with
respect to distributions under the Plan made for calendar years beginning on or
after January 1, 2002, the following language from the Code Section 401(a)(9)
model amendment contained in Internal Revenue Service Announcement 2001-18 shall
apply: “The Plan will apply the minimum distribution requirements of Code
Section 401(a)(9) in accordance with the regulations under section 401(a)(9)
that were proposed on January 17, 2001, notwithstanding any provision of the
Plan to the contrary. This change shall continue in effect until the end of the
last calendar year beginning before the effective date of final regulations
under Code Section 401(a)(9) or such other date as may be specified in guidance
published by the Internal Revenue Service.”
|
7.03
|
Eligible Rollover
Distributions
|
Notwithstanding
any provision of the Plan to the contrary that would otherwise limit a
distributee's election under this Article 7, effective for distributions made on
or after January 1, 1993, 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. For purposes of this Section, the
following definitions shall apply.
An
“eligible rollover distribution” shall, effective January 1, 2000, mean a
distribution described in Code Section 402(c)(4). Prior to January 1,
2000, the term “eligible rollover distribution” shall mean 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 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); and
provided further that the determination of what constitutes an “eligible
rollover distribution” shall at all time be made in accordance with the current
rules of Code Section 402(c), which shall be controlling for this
purpose. After December 31, 2001, the term “eligible rollover
distribution” shall include after-tax employee contributions which are not
includible in gross income (provided, that such contributions may be transferred
only to an individual retirement account or annuity described in Code Sections
408(a) or (b), or a qualified defined contribution plan described in Code
Sections 401(a) or 403(a) that agrees to separately account for 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 includable); and exclude any amount that is
distributed on account of hardship, as provided for in Section 5.04 of the Plan,
shall not be an eligible rollover distribution and the distributee
may
54
not elect
to have any portion of such a distribution paid directly to an eligible
retirement plan.
An
“eligible retirement plan” is an individual retirement account described in
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. After December 31, 2001, an “eligible
retirement plan” shall also include an annuity contract described in Code
Section 403(b) and an eligible plan under Code Section 457(b) (which is
maintained by a state, political subdivision of a state, or any agency or
instrumentality of a state or political subdivision of a state and which agrees
to separately account of amounts so transferred). However, in the
case of an eligible rollover distribution to the surviving Spouse, an “eligible
retirement plan” is an individual retirement account or individual retirement
annuity. After December 31, 2001, the definition of “eligible
retirement plan” shall also apply in the case of a distribution to a surviving
Spouse, or to a Spouse or former Spouse who is the alternate payee under a
qualified domestic relation order, as defined in Code Section
414(p).
A
“distributee” includes a Participant or former Participant. In
addition, the Participant's or former Participant's surviving Spouse and the
Participant's or former Participant's Spouse or former Spouse who is the
Alternate Payee under a Qualified Domestic Relations Order are distributed with
regard to the interest of the Spouse or former Spouse.
A “direct
rollover” is a payment by the Plan to the eligible retirement plan specified by
the distributee.
In
prescribing the manner of making elections with respect to eligible rollover
distributions, as described above, the Committee may provide for the uniform,
nondiscriminatory application of any restrictions permitted under applicable
Sections of the Code and related rules and regulations, including a requirement
that a distributee may not elect a partial direct rollover in an amount less
that $500 and a requirement that a distributee may not elect to make a direct
rollover from a single eligible rollover distribution to more than one eligible
retirement plan. Moreover, if a distribution is one to which Sections
401(a)(11) and 417 of the Code do not apply, such distribution may commence less
than 30 days after the notice required under Section 1.411(a)-11(c) of the
Income Tax Regulations is given, provided that:
|
|
(a)
|
The
Trustee clearly informs the Participant that the Participant has a right
to a period of at least thirty (30) days after receiving the notice to
consider the decision of whether or not to elect a distribution (and, if
applicable, a particular distribution option),
and
|
55
|
|
(b)
|
The
Participant, after receiving the notice, affirmatively elects a
distribution through the Voice Response
System.
|
ARTICLE
8
PLAN
ADMINISTRATION
|
8.01
|
Appointment of
Committee
|
The Plan
shall be administered by a Committee appointed by the President of the Company,
subject to the approval of the Board. The Committee shall be composed
of no more than five and no fewer than three members who shall hold office at
the pleasure of the Board. Such members may, but need not, be
Employees. Any person appointed a member of the Committee shall, at
the request of the Company’s President, signify acceptance by filing a written
acceptance with the Secretary of the Committee. Any member of the
Committee may resign by delivering a written resignation to the President of the
Company and the Secretary of the Committee. Such resignation shall be
effective no earlier than the date of the written notice. If a member
of the Committee is an Employee of the Company, he shall be deemed to have
resigned upon his termination of employment with the Company. The
Board or the President of the Company, may remove one or more members of the
Committee at any time.
|
8.02
|
Powers and
Duties
|
The
Committee will have full power to administer the Plan and shall determine
questions of interpretation or policy. The Committee's construction
or determination shall be final and binding on all parties. The
Committee may correct any defect, supply any omission, or reconcile any
inconsistency in the manner and to the extent deemed necessary or advisable to
carry out the purpose of this Plan. The Committee shall have all
powers necessary or appropriate to accomplish the Committee's duties under this
Plan. The Committee is the named fiduciary within the meaning of
Section 402(a) of ERISA for purposes of Plan administration. The
Committee's powers and duties, unless properly delegated, will include, but will
not be limited to:
|
|
(a)
|
Allocating
fiduciary responsibilities, other than Trustee responsibilities as defined
in ERISA Section 405(c), among the named fiduciaries and to designate one
or more other persons to carry out fiduciary
responsibilities.
|
|
|
(b)
|
Designating
agents to carry out responsibilities relating to the Plan, other than
fiduciary responsibilities.
|
|
|
(c)
|
Deciding
factual and nonfactual questions relating to eligibility, Service, and
amounts of benefits.
|
56
|
|
(d)
|
Deciding
disputes that may arise with regard to the rights of Employees,
Participants and their legal representatives, or Beneficiaries under the
terms of the Plan. Decisions by the Committee will be deemed
final in each case.
|
|
|
(e)
|
Obtaining
information from the Company with respect to its Employees as necessary to
determine the rights and benefits of Participants under the
Plan. The Committee may rely conclusively on such information
furnished by the Company.
|
|
|
(f)
|
Compiling
and maintaining all records necessary for the
Plan.
|
|
|
(g)
|
Authorizing
the Trustee to make payment of all benefits as they become payable under
the Plan.
|
|
|
(h)
|
Engaging
such legal, administrative, consulting, actuarial, investment, accounting,
and other professional services as the Committee deems
proper.
|
|
|
(I)
|
Adopting
rules and regulations for the administration of the Plan that are not
inconsistent with the Plan. The Committee may, in a
nondiscriminatory manner, waive the timing requirements of any notice or
other requirements described in the Plan. Any such waiver will
not obligate the Committee to waive any subsequent timing or other
requirements for other
Participants.
|
|
|
(j)
|
Performing
other actions provided for in other parts of this
Plan.
|
|
|
(k)
|
Upon
receipt of a domestic relations order, notifying the Participant and the
Alternate Payee (which notice shall include this Plan's procedure for
determining whether the order is a Qualified Domestic Relations Order) of
the receipt of the order; and within a reasonable time, determining
whether the order constitutes a Qualified Domestic Relations Order
by: (a) personal review of the order; (b) receipt of an opinion
of counsel; (c) seeking judicial interpretation and determination; or (d)
any combination or all of the foregoing; and, upon said determination,
communicating its decision in writing to the Participant, the Alternate
Payee, and if the decision affects a Participant's or Alternate Payee's
Accounts, the Trustee, as soon as
practicable.
|
|
8.03
|
Actions by the
Committee
|
A
majority of the members composing the Committee at any time will constitute a
quorum. The Committee may act at a meeting, or in writing without a
meeting, by the vote or assent of a majority of its members. The
Committee will elect one of its members as Chairperson and may elect a Secretary
who may, but need not, be a member of the Committee. The Secretary
will record all action taken by the Committee. The Committee will
have authority to designate in writing one of its
57
members
or any other person as the person authorized to execute papers and perform other
ministerial duties on behalf of the Committee.
|
8.04
|
Interested Committee
Members
|
No member
of the Committee will participate in an action of the Committee on a matter
which applies solely to that member. Such matters will be determined
by a majority of the remainder of the Committee.
|
8.05
|
Investment
Manager
|
The
Committee, by action reflected in its minutes, may appoint one or more
investment managers, as defined in Section 3(38) of ERISA, to manage all or a
portion of the assets of the Plan or to select Investment Funds. An
investment manager will discharge its duties in accordance with applicable law
and in particular in accordance with Section 404(a)(1) of ERISA. An
investment manager, when appointed, will have full power to either manage the
assets of the Plan for which it has responsibility or to select Investment
Funds, and neither the Company nor the Committee will thereafter have
responsibility for the management of such assets or, if applicable, selecting
Investment Funds.
|
8.06
|
Indemnification
|
The
Company, by this adoption, indemnifies and holds the members of the Committee,
jointly and severally, harmless from the effects and consequences of their acts,
omissions, and conduct in their official capacities, except to the extent that
the effects and consequences result from their own willful misconduct, breach of
good faith, or gross negligence in the performance of their
duties. The foregoing right of indemnification will not be exclusive
of other rights to which each such member may be entitled by any contract or
other instrument or as a matter of law.
|
8.07
|
Conclusiveness of
Action
|
Any
action on matters within the discretion of the Committee will be conclusive,
final, and binding upon all Participants in the Plan and upon all persons
claiming any rights, including Beneficiaries.
|
8.08
|
Payment of
Expenses
|
The
members of the Committee will serve without compensation for their
services. The compensation or fees of accountants and other
specialists and any other costs of administering the Plan or Trust Fund will be
paid by the Trust Fund unless paid by the Company in its
discretion.
|
8.09
|
Claims for
Benefits
|
58
Prior to
January 1, 2002, the following rules shall apply to a claim for
benefits. Any claim for benefits under this Plan shall be made in
writing by a Participant or Beneficiary or other party making the claim (the
“Claimant”) to the Committee.
If a
claim for benefits is wholly or partially denied, the Committee, within ninety
(90) calendar days after receipt of the claim, shall notify the Claimant of the
denial of the claim. The notice of denial: (a) shall be in
writing; (b) shall be written in a manner calculated to be understood by the
Claimant; and (c) shall contain: (1) the specific reason or reasons
for denial of the claim; (2) a specific reference to the Plan provisions upon
which the denial is based; (3) a description of any additional material or
information necessary to perfect the claim, along with an explanation of why the
material or information is necessary; and (4) an explanation of the claim review
procedure.
The
ninety (90) calendar day period, under special circumstances, may be extended up
to an additional ninety (90) calendar days upon written notice of the extension
to the Claimant which notice shall specify the special circumstances and the
extended date of the decision. Notice of the extension must be given
prior to expiration of the initial ninety (90) calendar day
period. If no notice of decision is given within the periods
specified above, the claim shall be deemed to have been denied on the last day
of the applicable ninety (90) or one hundred eighty (180) day period and the
Claimant, or his or her authorized representative, may file a request for review
as provided in Section 8.10.
Effective
January 1, 2002, any claim for benefits under the Plan shall be made in writing
to the Committee. If such claim for benefits is wholly or partially
denied, the Committee shall, within a reasonable period of time not to exceed
ninety (90) days after receipt of the claim, notify the Claimant of the denial
of the claim. Such notice of denial (a) shall be in writing,
(b) shall be written in a manner calculated to be understood by the
Claimant, and (c) shall contain (1) the specific reason or reasons for
denial of the claim, (2) a specific reference to the pertinent Plan
provisions upon which the denial is based, (3) a description of any
additional material or information necessary to perfect the claim, along with an
explanation of why such material or information is necessary, and (4) an
explanation of the claim review procedures. The ninety day period
may, under special circumstances, be extended up to an additional ninety days
upon written notice of such extension to the Claimant which notice shall specify
the extraordinary circumstances and the extended date of the decision, the time
limits applicable to such procedures and a statement of the Claimant’s right to
bring a civil action under ERISA Section 502(a) following an adverse benefit
determination upon review. Notice of extension must be given prior to
expiration of the initial ninety (90) day period. The extension
notice shall indicate the special circumstances that require an extension of
time and the date by which the Committee expects to render a decision on the
claim. If the claim is denied the Claimant may file a request for review as
provided in Section 8.10.
59
|
8.10
|
Request for Review of
Denial
|
Effective
prior to January 1, 2002, within sixty (60) days after the receipt by the
Claimant of a claim denial (or after the date a claim is deemed denied), the
Claimant has a maximum of sixty (60) calendar days to file a written request
that the Committee conduct a full and fair review of the denied
claim. The Claimant, or his authorized representative, may review
pertinent documents and submit issues and comments in writing to the Committee
in connection with the review.
Effective
January 1, 2002, Within sixty (60) days after the receipt of the decision
denying a claim by the Claimant, the Claimant may file a written request with
the Committee that it conduct a full and fair review of the denial of the claim
for benefits. The Claimant or his/her duly authorized representative may review
pertinent documents and submit issues and comments in writing to the Committee
in connection with the review.
|
8.11
|
Decision on Review of
Denial
|
Effective
prior to January 1, 2002, the Committee shall provide the Claimant with a final
written decision on the review of the denial within sixty (60) days after the
receipt of the aforesaid request for review, except that if there are special
circumstances (such as the need to hold a hearing, if necessary) which require
an extension of time for processing, the aforesaid sixty (60) day period shall,
upon written notice to the Claimant, be extended an additional sixty (60) days.
The decision on review of the denial shall: (a) be written in a
manner calculated to be understood by the Claimant; (b) include the specific
reason or reasons for the decision; and (c) contain a specific reference to the
Plan provisions upon which the decision is based. If the decision on
review is not delivered to the Claimant within the periods specified, the claim
shall be considered denied on review on the last day of the applicable sixty
(60) or one hundred twenty (120) day review period.
Effective
January 1, 2002, the Committee shall deliver to the Claimant a written decision
on the review of the denial within a reasonable period of time not to exceed
sixty (60) days after the receipt of the aforesaid request for review, except
that if there are special circumstances (such as the need to hold a hearing, if
necessary) which require an extension of time for processing, the aforesaid
sixty (60) day period shall, upon written notice to the Claimant be extended an
additional sixty (60) days. Notice of an extension shall be given within the
initial sixty (60) day review period. The extension notice shall
indicate the special circumstances that require an extension of time and the
date by which the Committee expects to render a decision upon
review. Upon review the Claimant shall be given the opportunity to
(1) submit written comments, documents, records, and other information relating
to its claim and (2) request and receive, free of charge, reasonable access to,
and copies of, all documents, records, and other information relevant to the
Claimant’s
60
claim for
benefits. Whether a document, record, or other information is
relevant to a claim for benefits shall be determined by reference to applicable
ERISA regulations. The review of a denied claim shall take into account all
comments, documents, records, and other information submitted by the Claimant
relating to the claim, without regard to whether such information was submitted
or considered in the initial benefit determination. The decision on
review shall be written in a manner calculated to be understood by the Claimant
and, if adverse, shall (1) include the specific reason or reasons for the
decision, (2) contain a specific reference to the pertinent Plan provisions
upon which the decision is based, (3) contain a statement that the Claimant is
entitled to receive, upon request and free of charge, reasonable access to, and
copies of, all documents, records, and other information relevant to the
Claimant’s claim for benefits (whether a document, record, or other information
is relevant to a claim for benefits shall be determined by reference to
applicable ERISA Regulations), and (4) contain a statement describing the
Claimant’s right to bring an action under ERISA Section 502(a).
|
8.12
|
Notice of Time
Limits
|
When a
Participant or a Beneficiary files a claim, the Committee shall notify him or
her of the claim and review procedure including the time periods
involved.
|
8.13
|
Corrections Pursuant
to Remedial Programs
|
In the
event there has been an operational defect in the administration of the Plan,
the Board, or if appropriate the Committee, may take such actions as are
necessary to correct such defects provided that such actions are pursuant to an
Internal Revenue Service Administrative Policy Regarding Sanctions, Voluntary
Compliance Resolution Program, Closing Agreement Program, Self-Correction
Program or Voluntary Correction Program, collectively referred to as “Programs,”
or any other program that the Internal Revenue Service creates as a successor or
modification to such Programs or any remedial program instituted by the U.S.
Department of Labor.
ARTICLE
9
AMENDMENT, TERMINATION, AND
MERGER OF THE PLAN
|
9.01
|
Right to Amend the
Plan
|
The Board
will have the right at any time and from time to time to adopt a written
amendment, amending in whole or in part, any provision of the
Plan. The
61
Committee
shall also have the power to adopt written amendments to the Plan that (i) are
necessary or appropriate to satisfy the Code or ERISA, and all regulations
thereto, or (ii) do not increase the rate of Section 3.02 Company Matching
Contribution or costs to the Plan. No such amendment shall increase
the duties or responsibilities of the Trustee without the Trustee's written
consent. No amendment will be made to this Plan that attempts to
transfer any part of the corpus or income of the Trust Fund to purposes other
than the exclusive benefit of Participants and their Beneficiaries, nor may any
amendment disturb the Vested rights of any Participant.
|
9.02
|
Right to Terminate the
Plan
|
The Board
will have the right to adopt a written amendment to terminate the Plan in whole
or in part at any time. To the extent required under the Code, upon
termination, partial termination, or complete discontinuance of contributions to
the Plan, all Accounts of affected Participants will become one hundred percent
(100%) Vested.
|
9.03
|
Plan Merger and
Consolidation
|
If the
Plan is merged or consolidated with any other Plan, or if the assets or
liabilities of the Plan are transferred to any other Plan, each Participant will
be entitled to a benefit immediately after the merger, consolidation, or
transfer, determined as if the Plan had then terminated, at least equal to the
benefit to which the Participant would have been entitled had the Plan
terminated immediately before such merger, consolidation, or
transfer.
ARTICLE
10
TRUST FUND AND THE
TRUSTEE
|
10.01
|
Selection of
Trustee
|
The Board
or its authorized delegate will select a Trustee to hold the Trust Fund in
accordance with the terms of an agreement. Except to the extent
otherwise provided in this Plan, responsibility for the management, investment,
and disposition of Plan assets will belong to the Trustee except to the extent
the Committee reserves such responsibility for itself or appoints an Investment
Manager pursuant to Section 8.05. To the extent the Committee or
Investment Manager is given this responsibility, the Trustee will not be liable
by reason of its taking or refraining from taking any action at the direction of
the Committee or Investment Manager. If the Trustee manages and
invests the Trust Fund, the agreement with the Trustee may include a provision
authorizing the Trust Fund
62
or a
portion thereof to be invested in a joint or associated Trust Fund or Common
Trust Fund.
The Board
may, from time to time, adopt a resolution causing a change in Trustees or the
termination of the Trust and invest Plan assets in any other method acceptable
under ERISA.
ARTICLE
11
TOP-HEAVY PLAN
REQUIREMENTS
|
11.01
|
General
Rule
|
For any
Plan Year for which this Plan is a Top-Heavy Plan, as defined in Section 11.07,
and despite any other provisions of this Plan to the contrary, this Plan will be
subject to the provisions of this Article 11.
|
11.02
|
Vesting
Provisions
|
Each
Eligible Employee who has completed an Hour of Service during the Plan Year in
which the Plan is Top-Heavy will have the Vested portion of his Company Matching
Contributions Account determined according to Section 6.04.
|
11.03
|
Minimum Contribution
Provision
|
Each
Eligible Employee who is a Non-Key Employee, as defined in Section 11.09 and is
employed on the last day of the Plan Year even if such Eligible Employee has
failed to complete one thousand (1,000) Hours of Service during such Plan Year
or was excluded from the Plan for failing to make Deferrals to the Plan, will be
entitled to have the aggregate of Contributions and forfeitures allocated to his
Company Matching Contributions Account and Deferral Account equal not less than
three percent (3%) (the “Minimum Contribution Percentage”) of his
Compensation. This Minimum Contribution Percentage will be reduced
for any Plan Year to the percentage at which such contributions (including
forfeitures) are made or are required to be made under the Plan for the Plan
Year for the Key Employee for whom such percentage is the highest for such Plan
Year. For this purpose, the percentage with respect to a Key
Employee, as defined in Section 11.08, will be determined by dividing such
contributions (including forfeitures) made for such Key Employee by the amount
of his total Compensation for the Plan Year. Effective for Plan Years
beginning on and after January 1, 2002, Employer matching contributions shall be
taken into account for purposes of satisfying the minimum contribution
requirements of section 416(c)(2) of the Code and the plan. The
preceding sentence shall apply with respect to matching contributions under the
Plan or, if the Plan provides that the minimum contribution requirement shall be
met
63
in
another plan, such other plan. Employer matching contributions that
are used to satisfy the minimum contribution requirements shall be treated as
matching contributions for purposes of the actual contribution percentage test
and other requirements of section 401(m) of the Code.
Contributions
considered under the first paragraph of this Section 11.03 will include the
contributions described above under this Plan and contributions under all other
defined contribution plans required to be included in an Aggregation Group (as
defined in Section 11.07), but will not include any plan required in such
aggregation group if the Plan enables a defined contribution plan required to be
included in such group to meet the requirements of the Code prohibiting
discrimination as to contributions or benefits in favor of Employees who are
officers, shareholders, or the highly compensated or prescribing the minimum
participation standards.
Contributions
considered under this Section will not include any contributions under the
Social Security Act or any other federal or state law.
|
11.04
|
Limitation on
Compensation
|
A
Participant's annual Compensation taken into account under this Article 11, for
purposes of computing benefits under this Plan will be as indicated in Article
1.
|
11.05
|
Limitation on
Contributions
|
In the
event that the Company also maintains a defined benefit plan providing benefits
on behalf of Participants in this Plan, one of the two following provisions will
apply in Plan Years beginning before January 1, 2000:
|
|
(a)
|
If
for the Plan Year this Plan would not be a “top-heavy” Plan as defined in
Section 11.07 below if “ninety percent (90%)” were substituted for “sixty
percent (60%),” then Section 11.03 will apply for such Plan Year as if
amended so that the “four percent (4%)” were substituted for “three
percent (3%).”
|
|
|
(b)
|
If
for the Plan Year this Plan either
|
|
|
(i)
|
is
subject to Section 11.05(a) but does not provide the additional minimum
contribution as required therein or
|
|
|
(ii)
|
would
continue to be a “Top-Heavy Plan” as defined in Section 11.07 if “ninety
percent (90%)” were substituted for “sixty percent (60%),” then the
denominator of both the Defined Contribution Plan Fraction and the Defined
Benefit Plan Fraction will be calculated as set forth in Section 3.04(c)
for the Plan Year by substituting “one” for “one and twenty-five
hundredths” in each place such figure appears except
with
|
64
respect
to any individual for whom there are no Company Matching Contributions or
forfeitures allocated or any accruals for such individual under the defined
benefit plan.
11.06
Coordination with
Other Plans
In the
event that the Company maintains a Top-Heavy Defined Benefit Plan under which
contributions or benefits are provided on behalf of a Participant in this Plan,
such other plan will be treated as a part of this Plan pursuant to applicable
principles set forth in Revenue Ruling 81-202 in determining whether the plans
are providing benefits at least equal to the minimum benefit required under the
Defined Benefit Plan. If the Plan is subject to Section 11.05(b) but
the Company does not substitute “one” for “one and twenty-five hundredths” as
required by Section 11.05(b), the applicable percentage under the Defined
Benefit Plan will be increased by one percentage point (up to a maximum of ten
percentage points).
If the
Company maintains more than one plan, Non-Key Employees covered under only a
Defined Benefit Plan will receive the defined benefit
minimum. Non-Key Employees covered only by a Defined Contribution
Plan will receive the defined contribution minimum. Where all plans involved are
Defined Contribution Plans, only this Plan need provide the minimum contribution
for all Participants of the required aggregation group.
|
11.07
|
Determination of
Top-Heavy Status
|
The Plan
will be a Top-Heavy Plan for any Plan Year if, as of the Determination Date (as
defined in subsection (b) below), the aggregate value of Accounts (as defined in
subsection (d) below) under the Plan for all Key Employees (as defined in
Section 11.08 below) exceeds 60 percent (60%) of the value of the aggregate of
the Accounts for all Employees, or if this Plan is required to be in an
Aggregation Group (as defined in subsection (a) below) which for such Plan Year
is a Top-Heavy Group (as defined in subsection (c) below).
For
purposes of this Article, the capitalized words have the following
meanings:
|
|
(a)
|
“Aggregation
Group” means the group of plans, if any, that includes both the group of
plans required to be aggregated and the group of plans permitted to be
aggregated.
|
|
|
(i)
|
The
group of plans required to be aggregated (the “required aggregation
group”) includes:
|
|
|
(A)
|
Each
plan of the Affiliated Company in which a Key Employee is a Participant,
(in the Plan year containing the
determination
|
65
date or
any of the four preceding years) including Collectively Bargained Plans,
and
|
|
(B)
|
Each
other plan, including Collectively Bargained Plans, of the Affiliated
Company that enables a plan in which a Key Employee is a Participant to
meet the requirements of the Code prohibiting discrimination as to
contributions or benefits in favor of Employees who are officers,
shareholders, or highly compensated or prescribing the minimum
participation standards.
|
|
|
(ii)
|
The
group of plans that are permitted to be aggregated (the “permissive
aggregation group”) includes the required aggregation group plus one or
more plans of the Affiliated Company that is not part of the required
aggregation group and that the Committee certifies as a plan within the
permissive aggregation group. Such plan or plans may be added
to the permissive aggregation group only if, after the addition, the
aggregation group as a whole continues not to discriminate as to
contributions or benefits in favor of officers, shareholders, or the
highly compensated and to meet the minimum participation standards under
the Code.
|
For Plan
Years beginning after December 31, 2001, for purposes of determining the present
values of accrued benefits, and the amounts of account balances of Employees as
of the Determination Date, the following rules shall apply:
|
|
(A)
|
Distributions
during year ending on the Determination Date. The present values of
accrued benefits and the amounts of account balances of an Employee as of
the Determination Date shall be increased by the distributions made with
respect to the Employee under the Plan and any plan aggregated with the
Plan under section 416(g)(2) of the Code during the 1-year period ending
on the Determination Date. The preceding sentence shall also apply to
distributions under a terminated plan which, had it not been terminated,
would have been aggregated with the Plan under section 416(g)(2)(A)(i) of
the Code. In the case of a distribution made for a reason other than
separation from service, death, or disability, this provision shall be
applied by substituting "5-year period" for "1-year
period."
|
|
|
(B)
|
Employees
not performing services during year ending on the Determination Date. The
accrued benefits and accounts of any individual who has not performed
services for the Employer
|
66
during
the 1-year period ending on the Determination Date shall not be taken into
account.
|
|
(b)
|
“Determination
Date” means for any Plan Year the last day of the immediately preceding
Plan Year. However, for the first Plan Year of this Plan,
Determination Date means the last day of that Plan
Year.
|
|
|
(c)
|
“Top-Heavy
Group” means the Aggregation Group, if as of the applicable Determination
Date, the sum of the present value of the cumulative accrued benefits for
Key Employees under all Defined Benefit Plans included in the Aggregation
Group plus the aggregate of the Accounts of Key Employees under all
Defined Contribution Plans included in the Aggregation Group exceeds sixty
percent of the sum of the present value of the cumulative accrued benefits
for all Employees, excluding former Key Employees, under all such Defined
Benefit Plans plus the aggregate Accounts for all Employees, excluding
former Key Employees, under all such Defined Contribution
Plans. If the Aggregation Group that is a Top-Heavy Group is a
required aggregation group, each plan in the group will be a Top-Heavy
Plan. If the Aggregation Group that is a Top-Heavy Group is a
permissive aggregation group, only those plans that are part of the
required aggregation group will be treated as Top-Heavy
Plans. If the Aggregation Group is not a Top-Heavy Group, no
plan within such group will be a Top-Heavy
Plan.
|
|
|
(d)
|
“Value
of Accounts” means the sum of (I) the value, as of the most recent
Valuation Date occurring within the twelve months ending on the
Determination Date, of the Participant's Accounts and (ii) contributions
due to such Accounts as of the Determination Date, minus (iii) withdrawals
from such Accounts since such Valuation
Date.
|
|
|
(e)
|
In
determining whether this Plan constitutes a Top-Heavy Plan, the Committee
will make the following
adjustments:
|
|
|
(i)
|
When
more than one plan is aggregated, the Committee will determine separately
for each plan as of each plan's Determination Date the present value of
the accrued benefits or account balance. The results will then
be aggregated by adding the results of each plan as of the Determination
Dates for such plans that fall within the same calendar
year.
|
|
|
(ii)
|
In
determining the present value of the cumulative accrued benefit or the
amount of the account of any Employee, such present value or account will
include the amount in dollar value of the aggregate distributions made to
each Employee under the applicable plan during the 5-year period ending on
the Determination Date unless reflected in the value of the accrued
benefit or account balance as of the
most
|
67
recent
Valuation Date. The amounts will include distributions to Employees
representing the entire amount credited to their Accounts under the applicable
plan.
|
|
(iii)
|
Further,
in making such determination, such present value or such account will not
include any rollover contribution (or similar transfer) initiated by the
Employee.
|
|
|
(f)
|
In
any case where an individual is a Non-Key Employee with respect to an
applicable Plan but was a Key Employee with respect to such plan for any
previous Plan Year, any accrued benefit and any account of such Employee
will be altogether disregarded. For this purpose, to the extent
that a Key Employee is deemed to be a Key Employee if he or she met the
definition of Key Employee within any of the four preceding Plan Years,
this provision will apply following the end of such period of
time.
|
|
|
(g)
|
Further,
in making such determination, if an Participant has not performed any
Service for the Company at any time during the five-year period ending on
the Determination Date, any accrued benefit or the account for such
Participant will not be included.
|
|
11.08
|
Definition of Key
Employee
|
“Key
Employee” means any Employee (including a former or deceased Employee) under
this Plan who, at any time during the Plan Year in question or during any of the
four preceding Plan Years, is or was one of the following:
|
|
(a)
|
An
officer of the Company having Annual Compensation of fifty percent or more
of the amount in effect under Code Section 415(b)(1)(A) for any such Plan
Year. Whether an individual is an officer will be determined by
the Company on the basis of all the facts and circumstances, such as an
individual's authority, duties, and term of office, not on the mere fact
that the individual has the title of an officer. For any such
Plan Year, officers will be no more than the fewer
of:
|
|
|
(i)
|
50
Employees; or
|
|
|
(ii)
|
The
greater of 3 Employees or 10 percent of the
Employees.
|
For this
purpose, the highest-paid officers will be selected.
68
|
|
(b)
|
One
of the ten (10) Employees having annual Compensation from the Company of
more than the limitation in effect under Code Section 415(c)(1)(A), and
owning (or considered as owning, within the meaning of the constructive
ownership rules of the Code) both more than one-half percent interest and
the largest interests in the Company. If two Employees have the
same interest in the Company, the Employee having greater annual
Compensation from the Company will be treated as having a larger
interest.
|
|
|
(c)
|
Any
person who owns (or is considered as owning, within the meaning of the
constructive ownership rules of the Code) more than five percent of the
outstanding stock of the Company or stock possessing more than five
percent of the combined voting power of all stock of the
Company.
|
|
|
(d)
|
A
one percent owner of the Company having Annual Compensation from the
Company of more than $150,000 and possessing more than 1 percent of the
combined total voting power of all stock of the Company. For
purposes of this Section 11.08, a Beneficiary of a Key Employee will be
treated as a Key Employee. For purposes of subsections (c) and
(d), each Company and/or Affiliated Company is treated separately in
determining ownership percentages; but, in determining the amount of
Compensation, an Employee's total Compensation is taken into
account.
|
For Plan
Years beginning after December 31, 2001, “Key Employee” means, for
purposes of determining whether the Plan is a top-heavy plan under Code Section
416(g), any Employee or former Employee (including any deceased Employee) who at
any time during the Plan Year that includes the Determination Date was an
officer of the Employer having annual compensation greater than $130,000 (as
adjusted under Code Section 416(i)(1) for Plan Years beginning after
December 31, 2002), a 5-percent owner of the Employer, or a 1- percent owner of
the Employer having annual compensation of more than $150,000. For this purpose,
annual compensation means compensation within the meaning of Code Section
415(c)(3). The determination of who is a Key Employee will be made in accordance
with Code Section 416(i)(1) and the applicable regulations and other guidance of
general applicability issued thereunder.
|
11.09
|
Definition of Non-Key
Employee
|
The term
“Non-Key Employee” means any Employee (and any Beneficiary of an Employee) who
is not a Key Employee.
ARTICLE
12
USERRA
69
|
12.01
|
Qualified Military
Service
|
|
|
(a)
|
For
purposes of this Article VII, the term “Qualified Military Service” shall
mean any service in the uniformed service (as defined by USERRA) by an
individual who is entitled under USERRA to reemployment rights with
respect to the Company.
|
|
|
(b)
|
This
Article 12 shall be administered in a manner consistent with guidance
issued by the Internal Revenue Service; provided such guidance is
issued.
|
|
12.02
|
Eligibility and
Vesting
|
Notwithstanding
any provision of the Plan to the contrary, effective December 12, 1994: (1) a
Participant reemployed under USERRA shall be treated under the Plan as not
having incurred a Break in Service with the Company for vesting or eligibility
purposes because of the individual's period of Qualified Military Service; and
(2) each period of Qualified Military Service served by a Participant, upon
reemployment under USERRA, shall be considered under the Plan to be service with
the Company for the purpose of (I) determining the nonforfeitability of the
Participant's accrued benefits under the Plan and (ii) determining the accrual
of benefits under the Plan.
|
12.03
|
Make-up Deferrals and
Company Matching
Contributions
|
|
|
(a)
|
Notwithstanding
any provision of the Plan to the contrary, effective December 12, 1994;
with respect to a Participant, who under USERRA is entitled to make up a
Deferral, such Participant may:
|
|
|
(1)
|
make
additional Deferrals during the period which (I) begins on the date of the
Participant's reemployment with the Company, and (ii) has the same length
as the lesser of:
|
|
|
(a)
|
the
product of: (I) three (3), and (ii) the period of Qualified Military
Service which resulted in the USERRA rights;
and
|
|
|
(b)
|
five
(5) years; and
|
|
|
(2)
|
If
such Deferrals are made by the Participant, the Company shall make a
Company Matching Contribution based on the additional Deferrals in
paragraph (1) above, if any, that would have been required had the
Deferrals actually been made during the period of the Qualified Military
Service. Such contributions shall be made within the time-frame
provided for in paragraph (1)
above.
|
70
|
|
(b)
|
The
amount of the additional Deferrals that the Company must permit a
reemployed Participant to elect is an amount less than but not exceeding
the maximum amount of the Deferrals that the Participant would have been
permitted to make: (1) under the Plan under the limitations in Code
Section 414(u)(1)(A); (2) during the period of Qualified Military Service;
(3) if the Participant had continued to be employed by the Company during
this period, and received “Compensation” (as determined below); and (4) as
adjusted for any Deferrals actually made during the period of Qualified
Military Service. No make-up Deferrals may exceed the amount
the Participant would have been permitted or required to contribute had
the Participant remained continuously employed by the Company throughout
the period of Qualified Military
Service.
|
|
|
(c)
|
Investment
income or loss shall not be credited on any make-up Deferrals, or Company
Matching Contributions made as a result thereof, until such contributions
are made. A Participant covered under USERRA shall not share in
forfeitures, in any, allocated during the period of the Participant's
Qualified Military Service.
|
|
|
(d)
|
For
purposes of determining allowable make-up Deferrals, a Participant covered
by USERRA shall be treated as having received Compensation from the
Employer during the period of the Employee's Qualified Military Service
equal to: (1) the Compensation of the Participant would have received
during the period of Qualified Military Service (determined based on the
rate of pay the Participant would have received from the Company but for
absence during the period of Qualified Military Service); or (2) if the
Compensation the Participant would have received during the period of
Qualified Military Service was not reasonably certain, the Participant's
average Compensation from the Company during (I) the twelve-month period
immediately before the Qualified Military Service or (ii) if shorter, the
period of employment with the Company immediately before the Qualified
Military Service.
|
|
12.04
|
Loan Repayment
Suspension
|
Notwithstanding
any language in this Plan to the contrary effective December 12, 1994, the
Committee may, in its discretion, decide that the loan repayment obligation of a
Participant on Qualified Military Service will be suspended during all or part
of such service.
ARTICLE
13
MISCELLANEOUS
|
13.01
|
Limitation on
Distributions
|
71
|
|
Notwithstanding
any provision of this Plan regarding payment to Beneficiaries,
Participants, or any other person, the Committee may withhold payment to
any person if the Committee determines that such payment may expose the
Plan to conflicting claims for payment. As a condition for any
payments, the Committee may require such consent, representations,
releases, waivers, or other information as it deems
appropriate. The Committee may, in its discretion, comply with
the terms of any judgment or other judicial decree, order, settlement, or
agreement including, but not limited to, a Qualified Domestic Relations
Order as defined in Code Section
414(p).
|
|
13.02
|
Limitation on
Reversion of Contributions
|
Except as
provided in subsections (a) through (c) below, Company Matching Contributions
made under the Plan will be held for the exclusive benefit of Participants and
their Beneficiaries and may not revert to the Company.
|
|
(a)
|
In
the case of contributions conditioned on the Plan's initial qualification
under Section 401(a) and 401(k) of the Internal Revenue Code, if the Plan
does not qualify, such contributions may be returned to the Company within
one year after the date the Plan's qualification is denied. The
maximum Company Matching Contribution that may be returned to the Company
will not exceed the amount actually contributed to the Plan, or the value
of such contribution on the date it is returned to the Company, if
less.
|
|
|
(b)
|
Unless
the Board, in a resolution authorizing a Plan contribution, states that
the contribution is made unconditionally and without regard to its
deductibility under the appropriate section of the Code, any contribution
by the Employer to the Trust (except a top heavy contribution) is
conditioned upon the deductibility of the contribution by the Employer
under the applicable section of the Code. To the extent any
such deduction is disallowed or made as a result of a mistake of fact, the
Employer may demand repayment of such disallowed contribution and the
Trustee shall return such contribution within one (1) year following (I) a
final determination of the disallowance, whether by agreement with the
Internal Revenue Service or by final decision of a court of competent
jurisdiction, or (ii) the date of the mistaken contribution, whichever
applies. Earnings of the Plan attributable to the excess or
mistaken contribution may not be returned to the Employer, but any losses
attributable thereto must reduce the amount so
returned.
|
|
13.03
|
Voluntary
Plan
|
The Plan
is purely voluntary on the part of the Company and neither the establishment of
the Plan nor any Plan amendment nor the creation of any fund or account, nor the
payment of any benefits will be construed as giving any Employee
72
or any
person legal or equitable right against the Company, the Trustee, or the
Committee unless specifically provided for in this Plan or conferred by
affirmative action of the Committee or the Company according to the terms and
provisions of this Plan. Such actions will not be construed as giving
any Employee or Participant the right to be retained in the service of the
Company. All Employees and/or Participants will remain subject to
discharge to the same extent as though this Plan had not been
established.
|
13.04
|
Nonalienation of
Benefits
|
Participants
and their Beneficiaries are entitled to all the benefits specifically set out
under the terms of the Plan, but said benefits or any of the property rights in
the Plan will not be assignable or distributable to any creditor or other
claimant of such Participant. Except for a Qualified Domestic
Relations Order, and/or an offset or assignment described in Code Section
401(a)(13)(A) or (C), a Participant will not have the right to anticipate,
assign, pledge, accelerate, or in any way dispose of or encumber any of the
monies or benefits or other property that may be payable or become payable to
such Participant or his Beneficiary.
|
13.05
|
Inability to Receive
Benefits
|
If the
Committee receives evidence that a person entitled to receive any payment under
the Plan is physically or mentally incompetent to receive payment and to give a
valid release, and another person or an institution is maintaining or has
custody of such person, and no Guardian, Committee, or other representative of
the estate of such person has been duly appointed by a court of competent
jurisdiction, then any distribution made under the Plan may be made to such
other person or institution. The release of such other person or
institution will be a valid and complete discharge for the payment of such
distribution.
|
13.06
|
Unclaimed
Benefits
|
If the
Committee is unable, after reasonable and diligent effort, to locate a
Participant or Beneficiary who is entitled to a distribution under the Plan, the
distribution due such person will be forfeited after two years. If,
however, the Participant or Beneficiary later files a claim for such benefit, it
will be reinstated without any interest earned thereon. Notification
by certified or registered mail to the last known address of the Participant or
Beneficiary will be deemed a reasonable and diligent effort to locate such
person. The reinstatement of benefits shall be funded by forfeitures
incurred in the Plan Year of reinstatement to the extent necessary to reinstate
the benefits in full, and to the extent such forfeitures are inadequate, by
additional Company contributions.
Notwithstanding
anything in this Plan to the contrary, if after the adoption of a resolution to
terminate the Plan a Participant's or Beneficiary's benefit under
the
73
Plan
remains payable due to the inability of the Committee or Trustee to locate such
Participant or Beneficiary, the Committee or Trustee shall attempt to locate the
Participant or Beneficiary by either (a) mailing a notice (describing the Plan
benefits due such person) to such Participant or Beneficiary's last known
address as supplied by the Social Security Administration, or (b) request,
pursuant to Revenue Procedure 94-22 and Internal Revenue Service Policy
Statement P-1-187, that the Internal Revenue Service forward a notice similar to
that described in clause (a) to such person.
If the
Participant or Beneficiary cannot be located after the Committee or the Trustee
has taken the notification step described in clause (a) or (b) of the preceding
paragraph, the Trustee shall deposit all Plan benefits payable to the lost or
missing Participant or Beneficiary in an interest bearing savings account at a
federally insured bank; the lost or missing Participant or Beneficiary shall be
listed as the sole owner of such account and have the unconditional right to
withdraw all funds therein.
If a
missing Participant procedure is established by the Pension Benefit Guarantee
Corporation, or other federal agency, and applies to defined contribution plans,
the Committee may utilize such program.
|
13.07
|
Limitation of
Rights
|
Nothing
expressed or implied in the Plan is intended or will be construed to confer upon
or give to any person, firm, or association other than the Company, the
Participants, the Beneficiaries, and their successors in interest any right,
remedy, or claim under or by reason of this Plan.
|
13.08
|
Invalid
Provisions
|
In case
any provision of this Plan is held illegal or invalid for any reason, the
illegality or invalidity will not affect the remaining parts of the
Plan. The Plan will be construed and enforced as if the illegal and
invalid provisions had never been included.
|
13.09
|
One
Plan
|
This Plan
may be executed in any number of counterparts, each of which will be deemed an
original and the counterparts will constitute one and the same instrument and
may be sufficiently evidenced by any one counterpart.
|
13.10
|
Use and Form of
Words
|
74
Whenever
any words are used herein in the masculine gender, they will be construed as
though they were also used in the feminine gender in all cases where they would
apply, and vice versa. Whenever any words are used herein in the
singular form, they will be construed as though they were also used in the
plural form in all cases where they would apply, and vice versa.
|
13.11
|
Headings
|
Headings
of Articles and Sections are inserted solely for convenience and reference, and
constitute no part of the Plan.
|
13.12
|
Governing
Law
|
The Plan
will be governed by and construed according to the federal laws governing
Employee benefit plans qualified under the Code and according to the laws of the
State of Nevada where such laws are not in conflict with the aforementioned
federal laws.
ARTICLE
14
EMPLOYEE STOCK OWNERSHIP
PLAN
|
14.01
|
Purpose.
|
The
Southwest Gas Stock Fund shall be considered and designated as an Employee Stock
Ownership Plan (“ESOP”). The purpose of the ESOP is to allocate to
Participants and their Beneficiaries an ownership interest in the Company
through the distribution of Company Stock (or the fair market value of such
Company Stock) following a Participant’s termination of
service. Neither the Company, its officers, directors, Employees or
shareholders, nor any fiduciary of the Plan shall have any responsibility for
the value of any stock or other securities of the Company allocated to the
Account of, or distributed to, any Participant or Beneficiary hereunder, it
being understood that such stock or securities may decline in value or become
wholly worthless due to risks and circumstances which cannot be foreseen and
which may not be within the control of any such person or entities.
|
14.02
|
Investment in Company
Stock.
|
A
principal purpose of the ESOP is to provide the opportunity for Employees to
acquire Employer Securities. Accordingly, Company Matching
Contributions shall be invested primarily in Employer
Securities. Such contributions will be made in original issue Company
Stock or cash to be used to purchase Employer Securities either directly from
the Company, in the open-market, or in privately negotiated
transactions. Other cash received for investment in the Southwest Gas
Stock Fund
75
will be
used primarily to purchase Employer Securities. If Employer
Securities are not available for purchase, or if the Trustee determines that the
purchase of additional Employer Securities is not prudent or would not further
the purpose of the Plan, the Trustee shall, to the extent not inconsistent with
the Plan’s continued tax qualification as an employee stock ownership plan under
Section 4975(e)(7) of the Code, invest the assets of the ESOP in other
securities or investments. All purchases of Employer Securities shall
be made at prices which, in the judgment of the Trustee, do not exceed the fair
market value of such Employer Securities at the time of purchase.
|
14.03
|
Company Matching
Contributions; Vesting.
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|
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(a)
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Company Matching
Contributions
|
Payment
of Company Matching Contributions will be made to the Southwest Gas Stock Fund,
as set forth above in Section 3.02.
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(b)
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Vesting
|
Effective
January 1, 2002 and notwithstanding the provisions set forth above
in Section 6.04, dividends paid on Company Stock will be fully Vested
with the Participant, without regard to whether the Participant is Vested in the
Company Stock with respect to which the dividend is paid.
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14.04
|
Diversification.
|
Upon
reaching age fifty (50), a Participant may elect to transfer his Account
Balances attributable to Employer Securities to any other Investment Fund, and
invest future Company Matching Contributions in any other Investment
Fund.
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14.05
|
Voting of Employer
Securities.
|
All
Employer Securities held within the ESOP portion of the Plan shall be voted by
the Participant or the Trustee as set forth above in Section 4.03 and in the
Trust Agreement. Any shares of Employer Securities not credited to
Participant Accounts shall be voted by the Trustee in the same ratio that the
securities are voted by the Participants who exercised their voting
rights.
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14.06
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Form of
Distributions.
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Participant
Accounts held within the ESOP shall be distributed as set forth above in Section
7.01(a).
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14.07
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Dividends.
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76
Dividends
paid by the Company with respect to shares of Employer Securities held in the
ESOP shall, in the discretion of the Committee, be: (i) retained and reinvested
in the Plan; (ii) distributed to Participants or their Beneficiaries within 90
days after the end of the Plan Year in which they were received; (iii) paid in
cash directly to the Participant or their Beneficiaries or (iv) paid to the
Plan, where the Participants can subsequently elect to reinvest the
dividends into their ESOP accounts or take a cash distribution within 90 days
after the end of the Plan Year in which such dividends were
received.
IN
WITNESS WHEREOF, Southwest Gas Corporation has adopted this Plan this 5th day of
October 2001.
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SOUTHWEST
GAS CORPORATION
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|
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By: /s/
MICHAEL O. MAFFIE
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|
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Title: President
& Chief Executive Officer
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77
SOUTHWEST
GAS CORPORATION
EMPLOYEE'S
INVESTMENT PLAN
Schedule A -- Investment
Plans
Investment Funds
Effective March 16, 2001
Southwest
Gas Stock Fund
Fidelity
Investment Grade Bond Fund
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|
Fidelity
Retirement Money Market Portfolio
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Fidelity
Contrafund
Fidelity
Asset Manager - Growth
Fidelity
Growth & Income Portfolio
Fidelity
Low Priced Stock Fund
Vanguard
Index 500 Portfolio
Vanguard
International Growth Fund
Effective January 15,
2002
Fidelity
Retirement Money Market
Portfolio Fidelity Asset
Manager: Growth
Fidelity
U.S. Bond Index Fund
Vanguard
500 Index Fund - Admiral
Shares
Fidelity
Freedom Income Fund
Fidelity
Growth & Income Portfolio
Fidelity Freedom 2000 Fund
Fidelity
Contrafund
Fidelity Freedom 2010 Fund
Fidelity
Low-Priced Stock
Fund
Fidelity Freedom 2020 Fund
Brown
Capital Management, Inc.- Small Company
Fund
Fidelity Freedom 2030 Fund
Vanguard
International Growth Fund - Admiral
Shares
Fidelity Freedom 2040 Fund
Southwest
Gas Stock Fund
i
Designation of Investment
Funds
A
Participant's Deferrals and Excess Contributions may be invested entirely at his
discretion, in increments of 1 percent (1%), among the Investment
Funds. In the complete absence of any designation, the Participant's
Deferrals and/or Excess Deferrals will be invested in the Fidelity Retirement
Money Market Portfolio.
A
Participant's Company Matching Contributions Account will be invested in the
Southwest Gas Stock Fund as provided for in Section 4.03 of the Plan, except as
otherwise determined under the rules in (b) below relating to transfers between
Investment Funds.
Transfer Between and Among
Investment Funds
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(a)
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A
Participant may transfer amounts representing his Deferrals and Excess
Deferrals from one Investment Fund to another, one (1) time per Investment
Fund per month, up to twelve (12) times per calendar
year. Transfer of amounts from the Southwest Gas Stock Fund to
another Investment Fund will be subject to the requirement that fifty
percent (50%) of all funds invested in the ESOP remain invested in
Employer Securities and the rules in (b)
below.
|
Further,
transfer of amounts to or from the Southwest Gas Stock Fund by Participants who
are subjected to Section 16 or the Securities Exchange Act of 1934, as amended,
may only make such transfers six (6) months following the date of the most
recent “opposite way” transfer.
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(b)
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Upon
attaining age 50, a Participant may transfer amounts representing his
Company Matching Contributions Account invested in Employer Securities and
other cash received for investment in Southwest Gas Stock Fund to any of
the Investment Funds, in accordance with Section 4.03 and (a)
above.
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(c)
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The
investment of a Participant's entire Account Balance is subject to the
rules of Section 7.02 once the Participant becomes entitled to a
distribution pursuant to Section
7.02.
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ii
FIRST
AMENDMENT TO THE 2001
AMENDED
AND RESTATED SOUTHWEST GAS CORPORATION
EMPLOYEES’ INVESTMENT
PLAN
Effective
October 1, 2001, unless otherwise noted herein, the Southwest Gas Corporation
Employees’ Investment Plan (the “Plan”) is hereby amended pursuant to Plan
Section 9.01, as follows:
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2.
|
The
definition of Compensation is
amended to read as follows:
|
Compensation
means:
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|
(a)
|
For
purposes of determining an Eligible Employee’s benefits under the Plan,
the actual wages paid to an Eligible Employee during the applicable
period, including sales incentive payments and elective contributions that
are not includible in gross income under Code Sections 125, 402 and
403(b), but excluding pay for overtime hours, flexible benefit dollars,
bonuses, or other special payments, and the Company’s contributions toward
insurance, retirement, and other fringe benefits or employee welfare plans
or programs other than severance pay
arrangements.
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(b)
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For
purposes of Section 3.04, Section 3.05, Section 3.06, and Article 11 only,
an Eligible Employee’s “compensation” includes items identified in
Treasury Regulation Section 1.415-2(d)(2) and does not include items
identified in Treasury Regulation Section
1.415-2(d)(3).
|
Compensation
will mean only Compensation actually paid or includable in gross income in the
Plan Year. In no case will amounts deferred pursuant to Code Section
125 be included as Compensation under this subsection (b).
Notwithstanding
any language in this subsection (b) to the contrary, effective for Plan Years
beginning after December 31, 1996, “Compensation” for the purpose described in
this subsection shall include an Eligible Employee’s elective deferrals under
Code Section 402(g)(3), and amounts that pursuant to Code Sections 125 or 457
are contributed or deferred (at the Eligible Employee’s election) and are not
includible in the Eligible Employee’s gross income in the tax year contributed
or deferred. Notwithstanding any language in this subsection (b) to
the contrary, effective for Plan Years beginning after December 31, 1996,
“Compensation” for the purpose described in this subsection shall include an
Eligible Employee’s elective deferrals under Code Section 402(g)(3), and amounts
that pursuant to Code Sections 125 or 457 are contributed or deferred (at the
Eligible Employee’s election) and are not includible in the Eligible Employee’s
gross income in
1
the tax
year contributed or deferred. Notwithstanding any provision of this
Plan to the contrary, the following sentence that includes the model language of
Internal Revenue Service Notice 2001-37 shall apply on and after January 1,
2001. For Plan Years beginning on and after January 1, 2001, for
purposes of applying the limitations described in Section 3.06, the top-heavy
plan rules of Article 11, the Section 3.05(a) of “Compensation Percentage” and
the Section 3.04(a) definition of “Actual Deferral Percentage,” Compensation
paid or made available during such Plan Years shall include elective amounts
that are not includible in the gross income of the employee by reason of Code
Section 132(f)(4).
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(c)
|
The
annual Compensation taken into account under the Plan for any Plan Year
beginning on or after January 1, 1989, shall not exceed the maximum dollar
amount ($200,000 for the year beginning in 1989 and any other amount that
applies for a later year, including the limit of $150,000 that applies for
the year beginning in 1994 and $200,000 for the year beginning January 1,
2002) that is permitted as of the beginning of the year under Code Section
401(a)(17) (determined after giving effect to any statutory changes
affecting Code Section 401(a)(17) and any indexing or other adjustments
pursuant to Code Section 401(a)(17) that are applicable for the year of
the determination). In the case of a short Plan Year or other
period of less than 12 months requiring a reduction of the Code Section
401(a)(17) annual limit, the otherwise applicable limit shall be prorated
by multiplying it by a fraction, the numerator of which is the number of
months in the short period and the denominator of which is
12. Moreover, effective January 1, 1987, to December 31,
1996, in determining an Employee’s Compensation for purposes of the Code
Section 401(a)(17) limit, the rules of Code Section 414(q)(6) (requiring
the aggregation of Compensation paid to family members of certain Five
Percent Owners and the ten most highly compensated Employees) shall apply,
except that in applying such rules, the term “family” shall include only
the Spouse of the Employee and any lineal descendants of the Employee who
have not attained age 19 before the close of the year. If, as a
result of the application of such rules, the adjusted annual Code Section
401(a)(17) Compensation limit is exceeded, then such limit shall be
prorated among the affected individuals in proportion to each such
individual’s Compensation as determined prior to the application of the
Code Section 401(a)(17) limit.
|
Effective
for Plan Years beginning after December 31, 1996, the aforesaid family
aggregation rules shall no longer apply.
|
3.
|
Section
3.04(a)(vii)(B) is amended to read as
follows:
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2
|
|
(B)
|
for
the Look-Back Year, had compensation exceeding eighty thousand dollars
($80,000) (this dollar amount shall be adjusted at the same time and in
the same manner as under Code Section 415(d)) and (if the Company elects
for the Look-Back Year immediately preceding the Determination Year in a
manner consistent with guidance prescribed by the Internal Revenue
Service; provided such guidance is issued) is in the Top Paid Group of
Eligible Employees in the Look-Back Year. The Employer did not
make a Top Paid Group election in Plan Years occurring during the period
in 1997-2001. The Company has made a Top Paid Group election in
Plan Years occurring after December 31,
2001.
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|
4.
|
Section
3.04(b) is amended to read as
follows:
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|
|
(b)
|
401(k)
Nondiscrimination Test.
|
Each Plan
Year the annual allocation derived from a Participant’s Deferrals shall satisfy
one of the following tests or any other test which might be prescribed under
Code Section 401(k):
|
|
(i)
|
The
Actual Deferral Percentage for Higher Compensated Employees shall not
exceed the Actual Deferral Percentage for Lower Compensated Employees
multiplied by 1.25; or
|
|
|
(ii)
|
The
Actual Deferral Percentage for Higher Compensated Employees shall not
exceed 2 multiplied by the Actual Deferral Percentage for Lower
Compensated Employees; and the excess for the Actual Deferral Percentage
for Higher Compensated Employees over the Actual Deferral Percentage for
Lower Compensated Employees shall not exceed 2 percentage
points.
|
Notwithstanding
the foregoing provisions of this subsection, effective for Plan Years beginning
after December 31, 1996, the Actual Deferral Percentage for Lower Compensated
Employees that shall, except as provided in the following sentence, be used in
applying the tests set forth in this subsection for a Determination Year shall
be the Actual Deferral Percentage for Lower Compensated Employees in the
Determination Year. The Company may elect (in a manner consistent
with guidance prescribed by the Internal Revenue Service; provided such guidance
is issued) to use, when applying the tests set forth in this subsection, the
Actual Deferral Percentage of Lower Compensated Employees in the Look-Back Year
instead of the Determination Year. In the Plan Years beginning
January 1, 1997, 1998, 1999, 2000 and 2001, the Company elected to utilize the
Actual Deferral Percentage of Lower Compensated Employees for the Determination
Year.
3
For
purposes of determining whether the Plan satisfies the actual deferral
percentage test of Code Section 401(k), all elective contributions that are made
under two or more plans that are aggregated for purposes of Code Section
401(a)(4) or 410(b) (other than Code Section 410(b)(2)(A)(ii)) are to be treated
as made under a single plan and that if two or more plans are permissively
aggregated for purposes of Code Section 401(k), the aggregated plans must also
satisfy Code Sections 401(a)(4) and 410(b) as though they were as single
plan.
|
5.
|
Section
3.04(c)(ii) is amended to read as
follows:
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|
|
(ii)
|
In
the event that the Deferrals allocated to Higher Compensated Employees for
any Plan Year result in Excess Contributions, the Committee shall direct
the Trustee to distribute the Excess Contributions, adjusted for any
applicable Trust Fund investment income or loss thereon, to the affected
Higher Compensated Employees by March 15 following the Plan Year in which
the Excess Contributions occurred but in no event later than the close of
the Plan Year following the Plan Year in which the Excess Contributions
occurred. To determine the portion of the Excess Contributions
to be distributed to each Higher Compensated Employee, the Committee shall
direct the Trustee to distribute the Deferrals allocated to Higher
Compensated Employees for the Plan Year in which the Excess Contributions
occurred to the extent necessary to prevent the Actual Deferral Percentage
for the group of Higher Compensated Employees from exceeding the
permissible Actual Deferral Percentage for the
group.
|
The
Committee shall direct the Trustee to make the distribution to the Higher
Compensation Employees with the highest Actual Deferral Ratio (for purposes of
the subsection the term “Actual Deferral Ratio” is defined in the following
paragraph) for the Plan Year and then to Higher Compensation Employees with the
next highest Actual Deferral Ratio for the Plan Year, and so on, in descending
order from the highest ratio. The amount of the Excess Contributions
to be distributed to a Higher Compensated Employee for a Plan Year is the
amount, if any, by which the Employee’s Deferrals must be reduced for the
Employee’s Actual Deferral Ratio to equal the highest permitted Actual Deferral
Ratio under the Plan.
To
calculate the highest permitted Actual Deferral Ratio under the Plan, the Actual
Deferral Ratio of the Higher Compensated Employee with the highest Actual
Deferral Ratio is reduced by the amount required to cause the Employee’s Actual
Deferral Ratio to equal the
4
ratio of
the Higher Compensated Employee with the next highest Actual Deferral
Ratio. If a lesser reduction would enable the Plan to satisfy the
test under Section 3.04(b), this lesser reduction shall be made. This
process shall be repeated until the Actual Deferral Percentage for Higher
Compensated Employees satisfies the test in Section 3.04(b). The
highest Actual Deferral Ratio remaining under the Plan after leveling is the
highest permitted Actual Deferral Ratio. In no case may the amount of
Excess Contribution exceed the amount of Deferrals on behalf of the Higher
Compensated Employee for the Plan Year.
For the
purposes of this subsection, the phrase “Actual Deferral Ratio” shall for Plan
Years beginning after December 31, 1996, refer to the dollar amount of such
Deferrals and for Plan Years beginning before January 1, 1997, shall mean the
Actual Deferral Ratio of a Higher Compensated Employee.
The
portion of the Excess Contributions applicable to each Higher Compensated
Employee shall be distributed to the Higher Compensated Employee in a single
payment. The portion of each Higher Compensated Employee’s Excess
Contributions that is to be distributed in accordance with this Section 3.04
shall be reduced by any Excess Deferrals previously distributed to the Higher
Compensated Employee with respect to the same Plan Year under Section
3.03.
|
12.
|
Section
3.05(b) is amended to read as
follows:
|
|
|
(b)
|
401(m)
Nondiscrimination Test.
|
Each Plan
Year the Company Section 3.02 matching contributions on behalf of Participants
(and Deferrals, if the Company makes a Section 3.05(d) election) shall satisfy
one of the following tests or any other test which might be prescribed under
Code Section 401(m):
|
|
(i)
|
The
Contribution Percentage for Higher Compensated Employees shall not exceed
the Contribution Percentage for Lower Compensated Employees multiplied by
1.25; or
|
|
|
(ii)
|
The
Contribution Percentage for Higher Compensated Employees shall not exceed
2 multiplied by the Contribution Percentage for Lower Compensated
Employees; and the excess of the Contribution Percentage for Higher
Compensated Employees over the Contribution Percentage for Lower
Compensated Employees shall not exceed 2 percentage
points.
|
Notwithstanding
the foregoing provisions of this subsection, effective for the Plan Years
beginning after December 31, 1996, the Compensation Percentage for Lower
Compensated Employees that shall, except as provided in the following sentence,
be used in applying the tests set forth in this subsection for a Determination
Year shall be the Compensation Percentage for Lower Compensated Employees in the
Determination Year. The Company may elect (in a manner consistent
with guidance prescribed by the Internal Revenue Service; provided such guidance
is issued) to use, when applying the tests set forth in this subsection, the
Compensation Percentage of Lower Compensated Employees in the Look-Back Year
rather than that of the Determination Year. Pursuant to the two
foregoing sentences, in the Plan Years beginning January 1, 1997, 1998, 1999,
2000 and 2001, the Company elected to utilize the ACP of Lower Compensated
Employees in the Determination Year.
For
purposes of determining whether the Plan satisfies the actual contribution
percentage test of Code Section 401(m), all employee and matching contributions
that are made under two or more plans that are aggregated for purposes of Code
Sections 401(a) and 410(b) (other than Code Section 410(b)(2)(A)(ii)) are to be
treated as made under a single plan, and that if two or more plans are
permissively aggregated for purposes of Code Section 401(m), the aggregated
plans must also satisfy Code Sections 401(a) and 410(b) as though they were a
single plan.
|
6.
|
Section
13.02 is amended to read as
follows:
|
|
13.02
|
Limitation on
Reversion of Contributions
|
Except as
provided in subsections (a) through (c) below, Company Matching Contributions
made under the Plan will be held for the exclusive benefit of Participants and
their Beneficiaries and may not revert to the Company.
|
|
(a)
|
In
the case of contributions conditioned on the Plan’s
initial qualification under Code Section 401(a) and 401(k), if the Plan
does not qualify, such contributions may be returned to the Company within
one year after the date the Plan’s qualification is denied, but only if
the application for the determination is made by the time prescribed by
law for filing the Company’s return for the taxable year in which the Plan
was adopted, or such later date as the Secretary of the Treasury may
prescribe. The maximum Company Matching Contribution that may
be returned to the Company will not exceed the amount actually contributed
to the Plan, or the value of such contribution on the date it is returned
to the Company, if less.
|
6
|
|
(b)
|
Unless
the Board, in a resolution authorizing a Plan contribution, states that
the contribution is made unconditionally and without regard to its
deductibility under the appropriate section of the Code, any contribution
by the Company to the Trust (except a top heavy contribution) is
conditioned upon the deductibility of the contribution by the Company
under the applicable section of the Code. To the extent any
such deduction is disallowed, the Company may demand repayment of such
disallowed contribution and Trustee shall return such contribution within
one (1) year after the disallowance of the deduction. Earnings
of the Plan attributable to an excess contribution may not be returned to
the Company, but any losses attributable thereto must reduce the amount so
returned.
|
|
|
(c)
|
In
case such contribution is made by the Company to the Plan (other than a
multiemployer plan) by a mistake of fact, the Company may demand repayment
of such contribution within one (1) year after the payment of the
contribution. Earnings of the Plan attributable to a mistaken
contribution may not be returned to the Company, but any losses
attributable thereto must reduce the amount so
returned.
|
|
|
13.
|
Section
14.06 is amended to read as
follows:
|
|
14.06
|
Valuation and Form of
Distributions
|
|
|
a.
|
To
the extent Employer Securities are not readily tradable on an established
securities market with respect to activities carried on by the Plan, all
valuations of such securities will be made by an independent appraiser,
who meets requirements similar to the requirements of the regulations
prescribed under Code Section
170(a)(1).
|
|
|
b.
|
Participant
Accounts held within the ESOP shall be distributed as set forth above in
Section 7.01(a), except to the extent Employer Securities are not readily
tradable on an established securities market. If such
securities are not readily tradable on such markets, the Company will
repurchase the securities within the time periods, and in accordance with
the methods described in Code Sections 409(h)(5) and
(6).
|
|
8.
|
Except
as hereby amended, the provisions of the Plan as in effect prior to this
amendment shall continue unchanged.
|
(The
next page is the signature page.)
7
IN
WITNESS WHEREOF, the Committee has adopted this amendment effective as stated
above. This amendment may be executed in any number of counterparts
and all of such counterparts taken together shall be deemed to constitute one
and the same instrument.
Dated at
Las Vegas, Nevada this 27th day of March 2003.
EMPLOYEES’
INVESTMENT PLAN COMMITTEE
|
/s/
GEORGE C. BIEHL
|
|
|
George
C. Biehl
|
|
|
/s/
FRED W. COVER
|
|
|
Fred
W. Cover
|
|
|
/s/
JAMES P. KANE
|
|
|
James
P. Kane
|
|
|
/s/
THOMAS R. SHEETS
|
|
|
Thomas
R. Sheets
|
8
SECOND
AMENDMENT TO THE 2001
AMENDED
AND RESTATED SOUTHWEST GAS CORPORATION
EMPLOYEES’ INVESTMENT
PLAN
Effective
October 1, 2001, unless otherwise noted herein, the Southwest Gas Corporation
Employees’ Investment Plan (the “Plan”) is hereby amended pursuant to Plan
Section 9.01, as follows:
|
6.
|
Section
14.06 is amended to read as
follows:
|
|
14.06
|
Valuation and Form of
Distributions
|
|
|
a.
|
To
the extent Employer Securities are not readily tradable on an established
securities market with respect to activities carried on by the Plan, all
valuations of such securities will be made by an independent appraiser,
who meets requirements similar to the requirements of the regulations
prescribed under Code Section
170(a)(1).
|
|
|
b.
|
Participant
Accounts held within the ESOP shall be distributed as set forth above in
Section 7.01(a), except to the extent Employer Securities are not readily
tradable on an established securities market. If such
securities are not readily tradable on such markets, the Company will
either (x) repurchase the securities at the time of distribution or (y)
provide a put option, for a period of at least 60 days following the date
of distribution of such securities, and if the option is not exercised
within such 60-day period, an additional option period of at least 60 days
will be provided in the next Plan Year and repurchase the securities as
follows:
|
|
|
(i)
|
For
total distributions (distributions within one taxable year of the balance
in a Participant’s account), the amount to be paid for such securities
will be paid in substantially equal periodic payments (not less frequently
than annually) over a period beginning not later than 30 days after the
exercise of the put option and not exceeding 5 years, provided that the
Company has put up adequate security and will pay reasonable interest on
the unpaid balance during the payment period;
and
|
|
|
(ii)
|
For
installment distributions (other than total distributions), the amount to
be paid for such securities will be paid not later than 30 days after the
exercised of the put option.
|
1
|
2.
|
Except
as hereby amended, the provisions of the Plan as in effect prior to this
amendment shall continue unchanged.
|
IN
WITNESS WHEREOF, the Committee has adopted this amendment effective as stated
above. This amendment may be executed in any number of counterparts
and all of such counterparts taken together shall be deemed to constitute one
and the same instrument.
Dated at
Las Vegas, Nevada this 30th day of
April 2003.
EMPLOYEES’
INVESTMENT PLAN COMMITTEE
|
/s/
GEORGE C. BIEHL
|
|
|
George
C. Biehl
|
|
|
/s/
FRED W. COVER
|
|
|
Fred
W. Cover
|
|
|
/s/
JAMES P. KANE
|
|
|
James
P. Kane
|
|
|
/s/
THOMAS R. SHEETS
|
|
|
Thomas
R. Sheets
|
2
THIRD
AMENDMENT TO THE 2001
AMENDED
AND RESTATED SOUTHWEST GAS CORPORATION
EMPLOYEES’ INVESTMENT
PLAN
Effective
January 1, 2003, unless otherwise noted herein, the Southwest Gas Corporation
Employees’ Investment Plan (the “Plan”) is hereby amended pursuant to Plan
Section 9.01, as follows:
|
|
7.
|
7.02
|
Timing of
Distributions
|
|
|
(a)
|
General
Rules
|
|
|
(i)
|
The
provisions of this Section 7.02 will apply for purposes of determining
required minimum distributions for calendar years beginning with the 2003
calendar year.
|
|
|
(ii)
|
If
the total amount of 2002 required minimum distributions made to a
Participant or Designated Beneficiary under the Plan prior to January 1,
2003 equals or exceeds the required minimum distributions required by this
Section 7.02, then no additional distributions will be required to be made
for 2002 on or after such date. If the total amount of 2002
required minimum distributions made to a Participant or Designated
Beneficiary under the Plan is less than such amount, then the required
minimum distributions for 2002 on and after such date will be determined
so that the total amount of required minimum distributions for 2002 made
to a Participant or Designated Beneficiary will equal the amount required
by this Section 7.02.
|
|
|
(iii)
|
The
requirements of this Section 7.02 will take precedence over any
inconsistent provisions of the
Plan.
|
|
|
(iv)
|
All
distributions required under this Section 7.02 will be determined and made
in accordance with the regulations under Code section
401(a)(9)Code.
|
|
|
(v)
|
Notwithstanding
the other provisions of this Section 7.02, distributions may be made under
a designation made before January 1, 1984, in accordance with section
242(b)(2) of the Tax Equity and Fiscal Responsibility Act (TEFRA) and the
provisions of the Plan that relate to section 242(b)(2) of
TEFRA.
|
1
(b) Definitions
For
purposes of this Section 7.02, the following terms mean:
|
|
(i)
|
“Designated
Beneficiary” means the individual who is designated as the Beneficiary
under the provisions of the Plan and is the Designated Beneficiary under
Code Section 401(a)(9) and Treasury Regulations Section 1.401(a)(9)-1,
Q&A-4.
|
|
|
(ii)
|
“Distribution
Calendar Year” means the calendar year for which a minimum distribution is
required. For distributions beginning before the Participant’s
death, the first Distribution Calendar Year is the calendar year
immediately preceding the calendar year which contains the Participant’s
Required Beginning Date. For distributions beginning after the
Participant’s death, the first Distribution Calendar Year is the calendar
year in which distributions are required to begin under this Section
7.02. The required minimum distribution for the Participant’s
first Distribution Calendar Year will be made on or before the
Participant’s Required Beginning Date. The required minimum
distribution for other Distribution Calendar Years, including the required
minimum distribution for the Distribution Calendar Year in which the
Participant’s Required Beginning Date occurs, will be made on or before
December 31 of that Distribution Calendar
Year.
|
|
|
(iii)
|
“Life
Expectancy” means the Life Expectancy as computed by use of the Single
Life Table in Treasury Regulations Section
1.401(a)(9)-9.
|
|
|
(iv)
|
“Participant’s
Account Balance” means the Total Vested Account Balance as of the last
Valuation Date in the calendar year immediately preceding the Distribution
Calendar Year (valuation calendar year) increased by the amount of any
contributions made and allocated or forfeitures allocated to the Total
Vested Account Balance as of dates in the valuation calendar year after
the Valuation Date and decreased by distributions made in the valuation
calendar year after the Valuation Date. The Total Vested
Account Balance for the valuation calendar year includes any amounts
rolled over or transferred to the Plan either in the valuation calendar
year or in the Distribution Calendar Year if distributed or transferred in
the valuation calendar year.
|
|
|
(v)
|
“Required
Beginning Date” means April 1 of the calendar year following the later of
the calendar year in which the Participant (other than a 5-percent owner)
attains age 70 ½ or the calendar year in which the Participant retires
from employment with the
Company. For
|
2
a
Participant who is a 5-percent owner, the Required Beginning Date means April 1
of the calendar year following the calendar year in which the Employee attains
age 70 ½.
|
|
(c)
|
Time and Manner of
Distribution
|
|
|
(i)
|
The
Participant’s entire interest will be distributed in a single sum to the
Participant no later than the Participant’s Required Beginning
Date.
|
|
|
(ii)
|
If
the Participant dies before distribution, the Participant’s entire
interest will be distributed to his or her Designated Beneficiary in a
single sum no later than the earlier of (x) the end of the month of the
fifth anniversary of the Participant’s death or (y) December 31 of the
calendar year in which the Participant would have attained age 70
½.
|
|
|
(iii)
|
If
the Designated Beneficiary dies before distribution, the entire interest
received from the Participant will be distributed in a single sum to the
beneficiary of the Designated Beneficiary immediately after notice of the
death of the Designated
Beneficiary.
|
|
|
(iv)
|
If
distributions under an annuity purchased from an insurance company
irrevocably commence to the Participant before the Participant’s Required
Beginning Date (or to the Participant’s surviving Spouse before the date
distributions are required to begin to the surviving Spouse under Section
7.02(c)(ii)(a)), the date distributions are considered to begin is the
date distributions actually
commence.
|
|
|
(v)
|
Unless
the Participant’s interest is distributed in a single sum or in the form
of an annuity purchased from an insurance company on or before the
Required Beginning Date, as of the first Distribution Calendar Year,
distributions will be made in accordance with Sections 7.02(d) and
(e). If the Participant’s interest is distributed in the form
of an annuity purchased from an insurance company, distributions
thereunder will be made in accordance with the requirements of section
401(a)(9) of the Code and the applicable Treasury
Regulations.
|
|
|
(d)
|
Required Minimum
Distributions During Participant’s
Lifetime
|
|
|
(i)
|
During
the Participant’s lifetime, the minimum amount that will be distributed
for each Distribution Calendar Year is the lesser
of:
|
3
|
|
(a)
|
the
quotient obtained by dividing the Participant’s Account Balance by the
distribution period in the Uniform Lifetime Table set forth in Treasury
Regulations Section 1.401(a)(9)-9, using the Participant’s age as of the
Participant’s birthday in the Distribution Calendar Year;
or
|
|
|
(b)
|
if
the Participant’s sole Designated Beneficiary for the Distribution
Calendar Year is the Participant’s Spouse, the quotient obtained by
dividing the Participant’s Account Balance by the number in the Joint and
Last Survivor Table set forth in Treasury Regulation Section
1.401(a)(9)-9, using the Participant’s and Spouse’s attained ages as of
the Participant’s and Spouse’s birthdays in the Distribution Calendar
Year.
|
|
|
(ii)
|
Required
minimum distributions will be determined under this Section 7.02(d)
beginning with the first Distribution Calendar Year and up to and
including the Distribution Calendar Year that includes the Participant’s
date of death.
|
|
|
(e)
|
Required Minimum
Distributions After Participant’s
Death
|
|
|
(i)
|
Death
On or After Date Distributions
Begin.
|
|
|
(a)
|
If
the Participant dies on or after the date distributions begin and there is
a Designated Beneficiary, the minimum amount that will be distributed for
each Distribution Calendar Year after the year of the Participant’s death
is the quotient obtained by dividing the Participant’s Account Balance by
the longer of the remaining Life Expectancy of the Participant or the
remaining Life Expectancy of the Participant’s Designated Beneficiary,
determined as follows:
|
|
|
(1)
|
The
Participant’s remaining Life Expectancy is calculated using the age of the
Participant in the year of death, reduced by one for each subsequent
year.
|
|
|
(2)
|
If
the Participant’s surviving Spouse is the Participant’s sole Designated
Beneficiary, the remaining Life Expectancy of the surviving Spouse is
calculated for each Distribution Calendar Year after the year of the
Participant’s death using the surviving Spouse’s age as of the Spouse’s
birthday in that year. For Distribution Calendar Years after
the year of the surviving Spouse’s death, the remaining Life Expectancy of
the surviving
|
4
Spouse is
calculated using the age of the surviving Spouse as of the Spouse’s birthday in
the calendar year of the Spouse’s death, reduced by one for each subsequent
calendar year.
|
|
(3)
|
If
the Participant’s surviving Spouse is not the Participant’s sole
Designated Beneficiary, the Designated Beneficiary’s remaining Life
Expectancy is calculated using the age of the Beneficiary in the year
following the year of the Participant’s death, reduced by one for each
subsequent year.
|
|
|
(b)
|
If
the Participant dies on or after the date distributions begin and there is
no Designated Beneficiary as of September 30 of the year after the year of
the Participant’s death, the minimum amount that will be distributed for
each Distribution Calendar Year after the year of the Participant’s death
is the quotient obtained by dividing the Participant’s Account Balance by
the Participant’s remaining Life Expectancy calculated using the age of
the Participant in the year of death, reduced by one for each subsequent
year.
|
|
|
(ii)
|
Death
Before Date Distributions Begin
|
|
|
(a)
|
If
the Participant dies before the date distributions begin and there is a
Designated Beneficiary, the minimum amount that will be distributed for
each Distribution Calendar Year after the year of the Participant’s death
is the quotient obtained by dividing the Participant’s Account Balance by
the remaining Life Expectancy of the Participant’s Designated Beneficiary,
determined as provided in Section
7.02(e)(i).
|
|
|
(b)
|
If
the Participant dies before the date distributions begin and there is no
Designated Beneficiary as of September 30 of the year following the year
of the Participant’s death, distribution of the participant’s entire
interest will be completed by December 31 of the calendar year containing
the fifth anniversary of the Participant’s
death.
|
|
|
(c)
|
If
the Participant dies before the date distributions begin, the
Participant’s surviving Spouse is the Participant’s sole Designated
Beneficiary, and the surviving Spouse dies before distributions are
required to begin to the surviving
Spouse
|
5
under
Section 7.02(c)(ii)(a), this Section 7.02(e)(ii) will apply as if the surviving
Spouse were the Participant.
|
2.
|
Except
as hereby amended, the provisions of the Plan as in effect prior to this
amendment shall continue unchanged.
|
IN
WITNESS WHEREOF, the Committee has adopted this amendment effective as stated
above. This amendment may be executed in any number of counterparts
and all of such counterparts taken together shall be deemed to constitute one
and the same instrument.
Dated at
Las Vegas, Nevada this 29th day of
December 2003.
EMPLOYEES’
INVESTMENT PLAN COMMITTEE
|
/s/
GEORGE C. BIEHL
|
|
|
George
C. Biehl
|
|
|
/s/
FRED W. COVER
|
|
|
Fred
W. Cover
|
|
|
/s/
JAMES P. KANE
|
|
|
James
P. Kane
|
|
|
/s/
THOMAS R. SHEETS
|
|
|
Thomas
R. Sheets
|
6
FOURTH
AMENDMENT TO THE 2001
AMENDED
AND RESTATED SOUTHWEST GAS CORPORATION
EMPLOYEES’ INVESTMENT
PLAN
Effective
March 28, 2005, Article 6 of the Southwest Gas Corporation Employees’ Investment Plan
(the “Plan”) is hereby
amended pursuant to Plan Section 9.01, to read as follows:
ARTICLE
6
VESTING OF RETIREMENT
DISABILITY, DEATH,
AND TERMINATION OF
EMPLOYMENT BENEFITS
|
|
6.01
|
Vesting Due to
Attainment of Normal Retirement Age and Normal Retirement
Benefits
|
The
Company Matching Contributions Account of a Participant will become, if it has
not already done so, one hundred percent (100%) Vested on the date the
Participant attains his Normal Retirement Age. A Participant is
always fully Vested in his Deferral Account, Frozen After Tax Account, and
Rollover Account. A Participant’s retirement
benefit shall be the amount credited to his Accounts as of the Valuation Date
preceding distribution of such benefit plus Section 3 contributions to such
Accounts on behalf of the Participant after such Valuation Date.
|
6.02
|
Vesting Due to
Disability and Disability
Benefits
|
The
Company Matching Contributions Account of a Participant, whose employment with
the Company is terminated because he is Permanently and Totally Disabled, will
become, if it has not already done so, one hundred percent (100%) Vested on the
date the Participant’s employment
terminates due to the Participant becoming Permanently and Totally
Disabled. A Participant is always fully Vested in his Deferral
Account, Frozen After Tax Account, and Rollover Account. A
Participant’s
disability benefit shall be the amount credited to his Accounts as of the
Valuation Date preceding distribution of such benefit plus Section 3
contributions to such Accounts on behalf of the Participant after such Valuation
Date.
|
6.03
|
Vesting Due to Death
and Death Benefits
|
The
Company Matching Contributions Account of a Participant, whose employment with
the Company is terminated due to death, will become, if it has not already done
so, one hundred percent (100%) Vested on the Participant’s date of
death. A Participant is always fully Vested in his Deferral Account,
Frozen After Tax Account, and Rollover Account. A
Participant’s death benefit
shall be the amount credited to his Accounts as of the Valuation Date preceding
distribution of such benefit plus Section 3 contributions to such Accounts on
behalf of the Participant after such Valuation Date.
|
6.04
|
Vesting Upon
Termination of Employment and Termination of Employment
Benefits
|
|
|
(a)
|
The
benefit payable under the Plan in the case of a Participant, whose
employment with the Company is terminated for any reason other than
described in Sections 6.01, 6.02, or 6.03, will be equal to the sum of (I)
the Vested value of his Accounts on the Valuation Date immediately
preceding payment of such benefits, and (ii) Article 3 subsequent
contributions to the Accounts on behalf of the Participant. The
Vested value of a Participant’s Accounts
will be equal to:
|
|
|
(I)
|
The
Participant’s Deferral
Account value; plus
|
|
|
(ii)
|
The
Participant’s Frozen
After Tax Account value; plus
|
|
|
(iii)
|
The
Participant’s Rollover
Account value; plus
|
|
|
(iv)
|
The
Vested portion of a Participant’s Company
Matching Contributions Account determined as
follows:
|
|
|
Years of
Service
|
Vested
Percentage
|
|
|
Less
than 1
|
0%
|
|
|
1 20%
|
|
|
2 40%
|
|
|
3 60%
|
|
|
4 80%
|
|
5
and over
|
100%
|
For
purposes of this Section 6.04, the term “Year of
Service” is a
whole year of Service which is twelve (12) months of Service (thirty (30) days
is deemed to be a month in the case of the aggregation of fractional
amounts).
|
6.05
|
Forfeitures
|
The
non-Vested portion of a Participant’s Company Matching
Contributions Account, if any, will be forfeited upon the earlier to occur of
(a) the date the Participant incurs his fifth consecutive one (1) year Period of
Severance or (b) the date that the Vested portion of the Participant’s Company Matching
Contributions Account is paid out according to the following
paragraph. If the Participant is zero percent vested in such account,
he shall be deemed to
2
have
received a distribution of such vested account balance on the date he terminated
employment with the Company.
Notwithstanding
any other provision of this Plan to the contrary, any such forfeitures will be
applied first to reinstate the forfeited portions of Company Matching
Contributions Accounts of rehired Participants and lost and missing Participants
and Beneficiaries as described in subsections 6.07(a) and 12.06. If
the amount of forfeitures available is insufficient to reinstate the Accounts
required to be reinstated for certain rehired Participants, the Company will
make an additional contribution in an amount required to reinstate such Accounts
fully.
|
6.06
|
Distributions
|
|
|
(a)
|
If,
upon a Participant’s
termination of employment, the Vested amount in his Accounts does not
exceed $1,000 (or any other amount as may be established, by regulations
of the Secretary of the Treasury) and the Participant does not elect to
have such balance paid directly to an eligible retirement plan specified
in a direct rollover within the time permitted by the Committee, the
Committee will direct the Trustee to distribute such balance to the
Participant.
|
|
|
(b)
|
If,
upon a Participant’s
termination of employment, the Vested amount in his Accounts is greater
than $1,000 and does not exceed $5,000 (or any other amount as may be
established, by regulations of the Secretary of the Treasury) without
regard to the portion of the Account Balance that is attributable to
rollover contributions (and earning allocable thereto) within the meaning
of Code Sections 402(c), 403(b)(8), 408(d)(3)(A)(ii), and 457(e)(16) and
the Participant does not elect to have such balance paid directly to an
eligible retirement plan specified in a direct rollover or to receive the
balance directly within the time permitted by the Committee, the Committee
will direct the Trustee to pay the balance in a direct rollover to an
individual retirement account designated by the Committee for the benefit
of the Participant.
|
|
|
(c)
|
If,
upon a Participant’s
termination of employment, the Vested amount in a
Participant’s Accounts
exceeds $5,000, without regard to such rollover contributions, the
Participant may request, through the Voice Response System, a distribution
of the entire Vested amount of such
Accounts.
|
|
|
(d)
|
Distributions
under this Section 6.06 shall occur as soon as administratively
practicable, but no later than the close of the second Plan Year following
the Plan Year in which the Participant’s
termination of employment occurred. Investment income will
continue to be allocated pursuant to Section 4.04 to the earlier of the
Business Day of or the first Business Day after the request for
distribution is made.
|
|
6.07
|
Reinstatement of
Forfeited Accounts
|
|
|
(a)
|
With
respect to the Participant who receives a distribution pursuant to Article
6.05 and whose Termination Date occurs before he is one hundred percent
(100%) Vested in his Company Matching Contributions Account, the
Participant may repay to the Plan the full amount distributed to him from
such Account; provided, however, that the repayment must occur before the
earlier of: (a) the date five (5) years after the date he is
subsequently re-employed by the Company, or (b) the day the Participant
incurs his fifth (5th) consecutive one (1) year Period of Severance
commencing after the date of the distribution. After such
repayment, the balance in the Participant’s Company
Matching Contributions Account shall be adjusted to the value of the
balance in his Company Matching Contributions Account on the date the
repaid distribution was originally made to the Participant. The
difference between the amount repaid by the Participant and the balance in
his Company Matching Contributions Account on the date the repaid
distribution was originally made shall be funded by all unallocated
forfeitures incurred in the Plan Year of repayment to the extent necessary
to reinstate the Participant’s Company
Matching Contributions Account in full, and to the extent such forfeitures
are inadequate, by additional Company
contributions.
|
|
|
(b)
|
With
respect to a Participant who terminates employment without being one
hundred percent (100%) Vested in his Company Matching Contributions
Account and who is reemployed after incurring five (5) consecutive one (1)
year Periods of Severance, Years of Service subsequent to his reemployment
will not increase the Vested percentage of the amount in his Company
Matching Contributions Account as of such prior termination of
employment.
|
Except as
hereby amended, the provisions of the Plan as in effect prior to this amendment
shall continue unchanged.
IN
WITNESS WHEREOF, the Committee has adopted this amendment effective as stated
above. This amendment may be executed in any number of counterparts
and all of such counterparts taken together shall be deemed to constitute one
and the same instrument.
4
Dated at
Las Vegas, Nevada, this 9th day of
December 2005.
EMPLOYEES’ INVESTMENT PLAN
COMMITTEE
|
/s/
GEORGE C. BIEHL
|
|
|
George
C. Biehl
|
|
|
/s/
FRED W. COVER
|
|
|
Fred
W. Cover
|
|
|
/s/
JAMES P. KANE
|
|
|
James
P. Kane
|
|
|
/s/
THOMAS R. SHEETS
|
|
|
Thomas
R. Sheets
|
5
FIFTH
AMENDMENT TO THE 2001
AMENDED
AND RESTATED SOUTHWEST GAS CORPORATION
EMPLOYEES’ INVESTMENT
PLAN
Effective
February 1, 2006, Schedule A of the Southwest Gas Corporation Employees’ Investment Plan
(the “Plan”) is hereby
amended pursuant to Plan Section 9.01, to read as follows:
|
|
1.
|
SOUTHWEST
GAS CORPORATION
EMPLOYEE’S INVESTMENT
PLAN
Schedule
A -- Investment Plans
|
Investment
Funds
|
||
|
Southwest
Gas Stock Fund
|
||
|
Fidelity
U.S. Bond Index Fund
|
||
|
Fidelity
Money Market Trust - Retirement Money Market Portfolio
|
||
|
Fidelity
U.S. Government Reserves
|
||
|
Fidelity
Contrafund
|
||
|
Fidelity
Asset Manager - Growth
|
||
|
Fidelity
Growth & Income Portfolio
|
||
|
Fidelity
Low Priced Stock Fund
|
||
|
Fidelity
Freedom Income Fund
|
||
|
Fidelity
Freedom 2000 Fund
|
||
|
Fidelity
Freedom 2010 Fund
|
||
|
Fidelity
Freedom 2020 Fund
|
||
|
Fidelity
Freedom 2030 Fund
|
||
|
Fidelity
Freedom 2040 Fund
|
||
|
Vanguard
Index 500 - Admiral Shares
|
||
|
Vanguard
World International Growth Fund - Admiral Shares
|
||
|
Brown
Capital Management, Inc.- Small Company Institutional
Fund
|
||
|
Lord
Abbett Small Cap Value Fund
|
||
Designation of Investment
Funds
A
Participant’s
Deferrals and Excess Contributions may be invested entirely at his discretion,
in increments of one percent (1%), among the Investment Funds. In the
complete absence of any designation, the Participant’s Deferrals and/or
Excess Deferrals will be invested in the Fidelity Freedom
Fund that
most closely corresponds to the Participant’s targeted
retirement date.
A
Participant’s
Company Matching Contributions Account will be invested in the Southwest Gas
Stock Fund as provided for in Section 4.03 of the Plan, except as otherwise
determined under the rules in (b) below relating to transfers between Investment
Funds.
Transfer Between and Among
Investment Funds
|
|
(a)
|
A
Participant may transfer amounts representing his Deferrals and Excess
Deferrals from one Investment Fund to another, one (1) time per Investment
Fund per month, up to twelve (12) times per calendar
year. Transfer of amounts from the Southwest Gas Stock Fund to
another Investment Fund will be subject to the requirement that fifty
percent (50%) of all funds invested in the ESOP remain invested in
Employer Securities and the rules in (b)
below.
|
Further,
transfer of amounts to or from the Southwest Gas Stock Fund by Participants who
are subjected to Section 16 or the Securities Exchange Act of 1934, as amended,
may only make such transfers six (6) months following the date of the most
recent “opposite way”
transfer.
|
|
(b)
|
Upon
attaining age fifty (50), a Participant may transfer amounts representing
his Company Matching Contributions Account invested in Employer Securities
and other cash received for investment in Southwest Gas Stock Fund to any
of the Investment Funds, in accordance with Section 4.03 and (a)
above.
|
|
|
(c)
|
The
investment of a Participant’s entire
Account Balance is subject to the rules of Section 7.02 once the
Participant becomes entitled to a distribution pursuant to Section
7.02.
|
|
2.
|
Except
as hereby amended, the provisions of the Plan as in effect prior to this
amendment shall continue unchanged.
|
2
IN
WITNESS WHEREOF, the Committee has adopted this amendment effective as stated
above. This amendment may be executed in any number of counterparts
and all of such counterparts taken together shall be deemed to constitute one
and the same instrument.
Dated at
Las Vegas, Nevada, this 3rd day of
February 2006.
EMPLOYEES’ INVESTMENT PLAN
COMMITTEE
|
/s/
GEORGE C. BIEHL
|
|
|
George
C. Biehl
|
|
|
/s/
FRED W. COVER
|
|
|
Fred
W. Cover
|
|
|
/s/
JAMES P. KANE
|
|
|
James
P. Kane
|
|
|
/s/
THOMAS R. SHEETS
|
|
|
Thomas
R. Sheets
|
3
SIXTH
AMENDMENT TO THE 2001
AMENDED
AND RESTATED SOUTHWEST GAS CORPORATION
EMPLOYEES’ INVESTMENT
PLAN
The
Southwest Gas Corporation Employees’ Investment Plan
(the “Plan”) is hereby
amended pursuant to Plan Section 9.01, to read as follows:
|
1.
|
Effective
January 1, 2006, the Article 1 definition of “Service” is amended
to read as follows:
|
Service means, with
respect to any Employee, his period or periods of employment with an Affiliated
Company that are counted as "Service" in accordance with the following
rules:
|
|
(a)
|
Each
Employee shall be credited with Service under the Plan for the period or
periods during which such Employee maintains an employment relationship
with the Affiliated Company. An Employee's employment
relationship will commence on the date the Employee first renders one Hour
of Service and ends on his severance from Service date. Service
will also include the following
periods:
|
|
|
(i)
|
Periods
of leave of absence with or without pay granted to the Employee by the
Affiliated Company in a like and nondiscriminatory manner for any purpose
including, but not limited to, sickness, accident, or military
leave. Such Employee shall not be considered to have terminated
employment during such leave of absence unless he fails to return to the
employ of the Company at or prior to the expiration date of such leave, in
which case he shall be deemed to have terminated as of the date of
commencement of such leave.
|
|
|
(ii)
|
Periods
during which a person is Permanently and Totally Disabled. Such
person shall not be considered to have terminated employment during such
period of disability unless he fails to return to the employ of the
Company at the expiration of such period, in which case he shall be deemed
to have terminated as of his date of
recovery.
|
|
|
(iii)
|
The
period of time between an Employee's severance from Service date by reason
of a resignation, discharge, or retirement and his reemployment date, if
the Employee returns to Service on or before such first anniversary
date.
|
|
|
(b)
|
In
the case of a person who incurs five (5) consecutive one (1) year Periods
of Severance, whose whole years of Service prior to his severance are less
than five (5) years, who is not Vested in his or her Company Matching
Contributions Account pursuant to Section 6.04 at the time he incurs such
five (5) consecutive one (1) year Periods of Severance, but is
then
|
reemployed
by the Company; his Service prior to such five (5) consecutive one (1) year
Periods of Severance shall be forfeited and shall not be included in determining
his Service under paragraph (a) above. Such person's Service at the
time of a one (1) year Period of Severance shall not include any Service
disregarded by virtue of the application of this subparagraph to any prior one
(1) year Period of Severance.
|
|
(c)
|
Subject
to (b) above, all periods of an Employee's Service, whether or not
consecutive, will be aggregated. Service will be measured in
elapsed years and fractions of years whereby each twelve (12) complete
calendar months will constitute one year, each completed calendar month
will constitute one-twelfth (1/12) of a year, and partial calendar months
which when aggregated equal thirty (30) days will constitute one-twelfth
(1/12) of a year
|
|
2.
|
Effective
January 1, 2006, Section 3.04(c)(iii) is amended to read as
follows:
|
|
|
(c)
|
Treatment of Excess
Contributions
|
|
|
(iii)
|
Excess
Contributions to be distributed under this Section 3.04 with respect to a
Higher Compensated Employee shall be adjusted to include any applicable
Trust Fund investment income or loss on such contributions. The
Trust Fund investment income or loss attributable to such Excess
Contribution shall be (1) the income or loss allocable to Higher
Compensated Employee's Excess Contributions for the preceding
calender year (which shall be determined by multiplying the income or loss
attributable to the Higher Compensated Employee's Deferrals in such year
by a fraction it’s the
numerator of which is the Participant's Excess Contributions in such year
and it’s the
denominator of which is the sum of the balance in the Higher Compensated
Employee's Deferral Account on the first day of such year plus Higher
Compensated Employee's Deferrals for the year) and (2) ten percent (10%)
of the amount determined under clause (1) multiplied by the number of
whole calendar months between the end of such year and the date of
distribution, counting the month of distribution if the distribution
occurs after the 15th
of such month. The distribution shall reduce the Participant's
Deferral Account as of the date it is distributed. The
Committee shall establish such rules and give such timely directions to
the Trustee as the Committee, in its sole discretion, deems appropriate to
carry out the provisions of this
paragraph.
|
2
|
3.
|
Effective
January 1, 2006, Section 3.05(d), “Company
Election” is amended
to read as follows:
|
|
|
(d)
|
Company
Election
|
In
computing the Contribution Percentage, the Company, in accordance with Treasury
Regulation Section 1.401(m)-2(a)(6), may, to the extent allowed by such
regulation, elect to use Deferrals in determining the Contribution
Percentage. The Committee shall establish such rules and give such
directions to the Trustee as shall be appropriate to carry out Section
3.05(c).
|
4.
|
Effective
January 1, 2006, Section 3.05(e)(iii) is amended to read as
follows:
|
|
|
(e)
|
Treatment of Excess
Aggregate Contributions
|
|
|
(iii)
|
Excess
Aggregate Contributions for a Plan Year that are to be distributed or
forfeited under this Section 3.05 with respect to a Higher Compensated
Employee shall be adjusted to include any appropriate Trust Fund
investment income or loss thereon for such Plan Year. The Trust
Fund investment income or loss allocable to such Participant's Excess
Aggregate Contributions for a Plan Year shall be (1) the sum of the income
or loss allocable to the Higher Compensated Employee’s Company
Matching Contributions Account (and Deferral Account, if the Company makes
a Section 3.05(d) election and is allowed by regulations to Code Section
401(m) to count contributions to Higher Compensated Employee’s Deferral
Account in the determination of Excess Aggregate Contributions) to the
extent there is a distribution or forfeiture attributable to said
Accounts, multiplied by a fraction: (A) the numerator of which equals the
Higher Compensated Employee’s Excess
Aggregate Contributions for the Plan Year, and (B) the denominator of
which equals the sum of the balance of such accounts at the beginning of
the such year plus the Company Section 3.02 Matching Contributions (and
the Participant’s Deferrals
if the Company makes a Section 3.05 (d) election, for such Plan Year if
Employer elects, and is allowed by regulations under Code Section 401(m),
to count such contributions in the determination of Excess Aggregate
Contributions), plus (2) ten percent (10%) of the amount
determined under clause (1) multiplied by the number of whole calendar
months between the end of the Plan Year and the date of distribution,
counting the month of distribution if the distribution occurs after the
15th
of such month. The distribution or forfeiture shall reduce the
Participant’s Company
Matching Contribution Account, (and Deferral Account, if the Company makes
a Section 3.05(d) election) as of the date it is distributed or forfeited,
to the extent there is a distribution or forfeiture attributable to
said
|
3
Accounts.
The Committee shall establish such rules and give such timely directions to the
Trustee as the Committee, in its sole discretion, deems appropriate to carry out
the provisions of this paragraph.
|
5.
|
Effective
January 1, 2006, Section 3.05(f), “Future Treasury
Regulations” is added to
the Plan and reads as follows:
|
|
|
(f)
|
Notwithstanding
any other provision of this Plan to the contrary, the
determination, calculation, and/or distribution of Excess Deferrals and/or
Excess Contributions shall be made in a manner consistent with Treasury
Regulations Sections 1.401(k)-1 and 1.401(k)-2, the terms of which are
hereby incorporated by reference. Additionally, notwithstanding
any other provision of this Plan to the contrary, the
determination, calculation, distribution and/or forfeiture of Excess
Aggregate Contributions shall be made in a manner consistent with Treasury
Regulations Sections 1.401(m)-1 and 1.401(m)-2, the terms of which are
hereby incorporated by reference.
|
|
6.
|
Effective
January 1, 2007, Section 4.03, “Investment of Company
Matching Contributions and Voting of Company Stock” is amended
to read as follows:
|
All
Company Matching Contributions shall be primarily invested in the Southwest Gas
Stock Fund, and shall be a part of the Employee Stock Ownership
Plan. Such contributions shall be based on the fair market value of
the Company Stock at the time contributed by the Company or purchased by the
Trustee from the Company, in the open market, or in privately negotiated
transactions. Once such contributions are deposited in a
Participant’s
Company Matching Contribution Account, a Participant may transfer such
contributions between and among Investment Funds, as provided for in Schedule A
to the Plan. Upon reaching age fifty (50), a Participant may elect to
have all future contributions to his Company Matching Contributions Account
invested in any of the Investments Funds as set forth above in Section
4.02.
This Plan
may acquire and hold qualifying securities of the Company. If all or
part of a Participant’s Company Matching
Contribution Account or other accounts is invested in Employer Securities, such
Participant shall be entitled to the voting rights based on the value of such
stock in his Account. The Trustee will vote the Company Stock that is
not voted by Participants in the same ratio that the stock is voted by the
Participants who exercised their voting rights. The Committee, in a
nondiscriminatory manner, will make any other necessary decisions arising out of
the acquisition or holding of Employer Securities.
4
|
7.
|
Effective
January 1, 2006, Section 4.05, “Limitation on
Participant Investment Instruction,” is amended
to read as follows:
|
Notwithstanding
anything else in this Plan to the contrary, the Committee will, unless in its
discretion it determines otherwise, decline to carry out a Participant’s investment
instructions if such instructions:
|
|
*
|
Would
result in a prohibited transaction described in ERISA Section 406 or Code
Section 4975;
|
|
|
*
|
Would
generate income that would be taxable to the
Plan;
|
|
|
*
|
Would
not be in accordance with the Plan;
|
|
|
*
|
Would
cause a fiduciary to maintain the indicia of ownership of any Plan assets
outside the jurisdiction of the district courts of the United States other
than as permitted by ERISA Section 404(b) and 29 CFR
2550.404b-1;
|
|
|
*
|
Would
jeopardize the Plan’s tax
qualified status under the Code; or
|
|
|
*
|
Could
result in a loss in excess of a Participant’s or
Beneficiary’s account
balance.
|
Furthermore,
notwithstanding any language in this Plan to the contrary, the Committee may
establish any and all rules and regulations it deems necessary to provide and
allow for a change in Plan record keeper, and/or Trustee, or a change in
Investment Funds, as determined by the Committee, that are available to Plan
Participants. Such rules and regulations may include, but not be
limited to, limits or prohibitions, during specified time periods, on the
availability of Participant enrollments, withdrawals, distributions, loans,
rollover contributions, Investment Fund transfers, and/or changes in Deferral
elections. Participants
shall also be subject to trading restrictions, penalties and rules established
by either (1) the Plan’s record keeper, or (2)
the company that maintains an Investment Fund option in which the Participant
has directed, or does direct, an investment of all or part of the
Participant’s
Plan Accounts.
|
8.
|
Effective
January 1, 2007, Sections 5.04(b)(i) and (ii), “Hardship Withdrawal
Conditions to be Met” are amended
to read as follows:
|
5
|
|
(i)
|
Before
the distribution the Participant, and if applicable the Participant's
Spouse, shall execute all consents to the distribution that would be
required if the withdrawal were a distribution upon the Participant’s
termination of employment, and the Participant submits documentation to
the Committee, or its designee, indicating that his or her requested
distribution is necessary to satisfy a financial need arising
from:
|
|
|
(A)
|
Expenses
for (or necessary to obtain) medical care that would be deductible under
Code Section 213(d)
(determined without regard to whether the expenses exceed 7.5% of adjusted
gross income);
|
|
|
(B)
|
Costs
directly related to the purchase (excluding mortgage payments), but not
the construction, repair, remodel, refinance, or lease of the
Participant's principal residence;
|
|
|
(C)
|
Payment
of tuition related educational fees, and room and board expenses for up to
the next twelve (12) months of post-secondary education for the
Participant, the Participant’s Spouse, or
the Participant’s children or the
Participant’s Code Section 152
dependents determined without regard to Code Section 152(b)(1), (b)(2) and
(d)(1)(B);
|
|
|
(D)
|
Payments necessary to prevent the
eviction of the Participant from his or her principal residence or the
foreclosure of the mortgage on the Participant’s
principal residence;
|
|
|
(E)
|
Payments for burial or funeral
expenses for the Participant’s deceased parent, the
Participant’s deceased Spouse, the
Participant’s deceased children, or the
Participant’s deceased Code Section 152
dependents determined without regard to Code Section 152(b)(1), (b)(2) and
(d)(1)(B);
|
|
|
(F)
|
Payment
for expenses for the repair and damage to the Participant’s principal
residence that would qualify for the casualty deduction under Code Section
165 (determined without regard to whether the loss exceeds 10% of adjusted
gross income); or
|
|
|
(G)
|
Such
other events as the Committee agrees to and as to which the
Commissioner of the Internal Revenue Service specifies, through the
publication of revenue rulings, notices, and other documents of general
availability, as giving rise to a
deemed
|
6
immediate
and heavy financial need.
|
|
(ii)
|
The
Participant’s hardship
distribution:
|
|
|
(A)
|
Must
be in an amount not exceeding the amount of the need arising under
subparagraph (i)(A-G) above. The amount of an immediate
and heavy financial need may include any amounts necessary to pay federal,
state, or local income taxes or penalties reasonably anticipated to result
from the distribution;
|
|
|
(B)
|
Cannot
be made until the Participant has obtained all other currently available
distributions (including the election to receive dividends under Article
14), other than hardship distributions, and all nontaxable loans
(determined at the time of the loan) that are currently available under
all qualified and nonqualified plans of the Company;
and
|
|
|
(C)
|
Shall
result in the Participant being prohibited from making Deferrals to this
and all other qualified and nonqualified plans of deferred compensation
maintained by the Company, for one year beginning on the date the
Participant receives a hardship withdrawal, if prior to January 1, 2002,
and for six (6) months if such withdrawal occurs after December 31,
2001.
|
|
9.
|
Effective
January 1, 2006, Section 9.02, “Right to Terminate the
Plan,” is amended
to read as follows:
|
The Board
will have the right to adopt a written amendment to terminate the Plan in whole
or in part at any time. To the extent required under the Code, upon
termination, partial termination, or complete discontinuance of contributions to
the Plan, all Accounts of affected Participants will become one hundred percent
(100%) Vested. Notwithstanding the foregoing, a distribution may not
be made upon the termination of this Plan if the Employer establishes or
maintains an alternative defined contribution plan at any time during the period
beginning on the date of the Plan’s termination and
ending twelve months after distribution of all Plan assets. A defined
contribution plan is not an alternative defined contribution plan if it is a
Code Section 4975(e)(7) or 409(a) employee stock ownership plan, a Code Section
408(k) simplified employee pension, a Code Section 408(p) simple IRA, a plan or
contract that satisfies the requirements of Code Section 403(b), or a plan
described in Code Section 457(b) or (f).
7
|
10.
|
Effective
January 1, 2006, Section 9.03, “Plan Merger and
Consolidation,” is amended
to read as follows:
|
If the
Plan is merged or consolidated with any other Plan, or if the assets or
liabilities of the Plan are transferred to any other Plan, each Participant will
be entitled to a benefit immediately after the merger, consolidation, or
transfer, determined as if the Plan had then terminated, at least equal to the
benefit to which the Participant would have been entitled had the Plan
terminated immediately before such merger, consolidation, or transfer. Notwithstanding
the foregoing, a transfer (but not a rollover) of Plan assets to another Plan,
or a merger with another plan, shall not occur unless the recipient plan
provides that transferred qualified non-elective contributions and qualified
matching contributions will not be distributable to a Participant until after
the Participant’s separation from service
with the Company.
|
11.
|
Section
14.04, “Diversification” is amended
to read as follows:
|
Once
Company Matching Contributions are deposited in a Participant’s Company Matching
Contribution Account, a Participant may transfer such contributions between and
among Investment Funds, as provided for in Schedule A to the Plan. Upon reaching
age fifty (50), a Participant may elect to invest future Company Matching
Contributions directly in any other Investment Fund.
|
12.
|
Effective
January 1, 2007, Schedule A, “Investment
Plans” is amended
to read as follows:
|
Schedule
A -- Investment Plans
|
Investment
Funds
|
||
|
Southwest
Gas Stock Fund
|
||
|
Fidelity
U.S. Bond Index Fund
|
||
|
Fidelity
Money Market Trust - Retirement Money Market Portfolio
|
||
|
Fidelity
U.S. Government Reserves
|
||
|
Fidelity
Contrafund
|
||
|
Fidelity
Asset Manager - Growth (Terminated
effective as of March 1, 2007)
|
||
|
Fidelity
Growth & Income Portfolio
|
||
|
Fidelity
Low Priced Stock Fund
|
||
|
Fidelity
Freedom Funds (All Freedom
Fund investment options are available effective as of March 1,
2007)
|
||
|
Vanguard
Index 500 - Admiral Shares (Vanguard
Index 500 - Institutional Shares effective as of February 1,
2007)
|
||
|
Vanguard
World International Growth Fund - Admiral
Shares
|
||
8
|
Brown
Capital Management, Inc.- Small Company Institutional
Fund
|
||
|
Lord
Abbett Small Cap Value Fund
|
Designation of Investment
Funds
A
Participant’s
Deferrals, Excess Contributions/Deferrals, and Rollover Contributions may be
invested entirely at his discretion, in increments of one percent (1%), among
the Investment Funds. In the complete absence of any designation, the
Participant’s
Deferrals, Excess Contributions/Deferrals and/or Rollover Contributions will be
invested in the Fidelity Freedom Fund that most closely corresponds to the
Participant’s
targeted retirement date.
A
Participant’s
Company Matching Contributions Account will be invested in the Southwest Gas
Stock Fund as provided for in Section 4.03 of the Plan, and the rules in (b)
below relating to transfers between Investment Funds.
Transfer Between and Among
Investment Funds
|
|
(a)
|
A
Participant may transfer amounts representing his Deferrals and Excess
Contributions/Deferrals, and Rollover Contribution from one Investment
Fund to another, daily. Transfer of amounts from the Southwest
Gas Stock Fund to another Investment Fund will be subject to the
requirement that fifty percent (50%) of all funds invested in the ESOP
remain invested in Employer Securities and the rules in (b)
below.
|
Further,
transfer of amounts to or from the Southwest Gas Stock Fund by Participants who
are subjected to Section 16 or the Securities Exchange Act of 1934, as amended,
may only make such transfers six (6) months following the date of the most
recent “opposite way”
transfer.
|
|
(b)
|
Once
Company Matching Contributions are deposited in a Participant’s Company
Matching Contribution Account, a Participant may immediately transfer such
contributions to other Investment Funds. Upon reaching age fifty (50), a
Participant may elect to invest future Company Matching Contributions
directly in any other Investment Fund, in accordance with Section 4.03 and
(a) above.
|
|
|
(c)
|
The
investment of a Participant’s entire
Account Balance is subject to the rules of Section 7.02 once the
Participant becomes entitled to a distribution pursuant to Section
7.02.
|
|
4.
|
Except
as hereby amended, the provisions of the Plan as in effect prior to this
amendment shall continue unchanged.
|
9
IN
WITNESS WHEREOF, the Committee has adopted this amendment effective as stated
above. This amendment may be executed in any number of counterparts and all of
such counterparts taken together shall be deemed to constitute one and the same
instrument.
Dated at
Las Vegas, Nevada, this 15th day of
December 2006.
EMPLOYEES’ INVESTMENT PLAN
COMMITTEE
|
/s/
GEORGE C. BIEHL
|
/s/
JAMES P. KANE
|
||
|
George
C. Biehl
|
James
P. Kane
|
||
|
/s/
FRED W. COVER
|
/s/
THOMAS R. SHEETS
|
||
|
Fred
W. Cover
|
Thomas
R. Sheets
|
10
SEVENTH
AMENDMENT TO THE 2001
AMENDED
AND RESTATED SOUTHWEST GAS CORPORATION
EMPLOYEES’ INVESTMENT
PLAN
Effective
October 1, 2007, the Southwest Gas Corporation Employees’ Investment Plan (the
“Plan”) is hereby amended pursuant to Plan Section 9.01, to as
follows:
|
1.
|
Section
3.01(b) is amended to read as
follows:
|
|
|
(b)
|
Unmatched
Deferrals.
|
Participant
making Matched Deferrals at the maximum percentage rate may elect to further
reduce his Compensation, including pay for overtime hours, in a fixed whole
percentage of not less than one percent (1%) and not more than fifty-four
percent (54%) or the cash compensation payable to the Participant after all
other applicable withholdings. The Company will make
payments to the Plan within the time frame required by applicable laws and
regulations of the amount of the reduction to be credited to the Participant's
Deferral Account. Amounts deferred under this subsection will be
contributed as Unmatched Deferrals.
|
2.
|
Except
as hereby amended, the provisions of the Plan as in effect prior to this
amendment shall continue unchanged.
|
IN
WITNESS WHEREOF, the Committee has adopted this amendment effective as stated
above. This amendment may be executed in any number of counterparts
and all of such counterparts taken together shall be deemed to constitute one
and the same instrument.
Dated at
Las Vegas, Nevada, this 5th day of
September 2007.
EMPLOYEES’
INVESTMENT PLAN COMMITTEE
|
/s/
GEORGE C. BIEHL
|
/s/
JAMES P. KANE
|
||
|
George
C. Biehl
|
James
P. Kane
|
||
|
/s/
FRED W. COVER
|
/s/
THOMAS R. SHEETS
|
||
|
Fred
W. Cover
|
Thomas
R. Sheets
|
EIGHTH
AMENDMENT TO THE 2001
AMENDED
AND RESTATED SOUTHWEST GAS CORPORATION
EMPLOYEES’ INVESTMENT
PLAN
Effective
January 1, 2008, the Southwest Gas Corporation Employees’ Investment Plan (the
“Plan”) is hereby amended pursuant to Plan Section 9.01, as
follows:
|
1.
|
Section
3.01(a) is amended to read as
follows:
|
|
|
(a)
|
Matched
Deferrals
|
Upon
enrollment or reenrollment in the Plan, each Participant must elect to reduce
his Compensation in a fixed whole percentage of not less than two percent (2%)
and not more than seven percent (7%). The Company will make payments
to the Plan within the time frame required by applicable laws and regulations of
the amount of the reduction, to be credited to the Participant's Deferral
Account. Amounts deferred under this subsection will be contributed
as Matched Deferrals.
|
2.
|
Section
3.02(a) is amended to read as
follows:
|
|
|
(a)
|
The
Company will, on behalf of eligible Participants, contribute an amount
which equals the sum of the amounts to be allocated to the Company
Matching Contributions Account of each eligible
Participant. The amount allocated to the Company Matching
Contributions Account for each eligible Participant will equal fifty
percent (50%) of the eligible Participant's Matched Deferrals plus
forfeitures allocated under Section 3.07. The maximum Company
Matching Contribution under this Plan equals three and one-half percent
(3½%)
of a Participant's Compensation. For purposes of this Section
3.02(a), the term "eligible Participant" means any Participant other than
a Participant who is an officer of the Company or who has been selected to
participate in the Company’s executive deferral
plan.
|
|
3.
|
Section
11.03 is amended to read as
follows:
|
Each
Eligible Employee who is a Non-Key Employee, as defined in Section 11.09 and is
employed on the last day of the Plan Year even if such Eligible Employee has
failed to complete one thousand (1,000) Hours of Service during such Plan Year
or was excluded from the Plan for failing to make Deferrals to the Plan, will be
entitled to have the aggregate of Contributions and forfeitures allocated to his
Company Matching Contributions Account and Deferral Account equal not less than
three and one-half percent (3½%) (the “Minimum
Contribution Percentage”) of his Compensation. This Minimum
Contribution Percentage will be reduced for any Plan Year to the percentage at
which such contributions (including forfeitures) are made or are required to be
made under the Plan for the Plan Year for the Key Employee for whom
such percentage is the highest for such Plan Year. For this purpose,
the
percentage
with respect to a Key Employee, as defined in Section 11.08, will be determined
by dividing such contributions (including forfeitures) made for such Key
Employee by the amount of his total Compensation for the Plan
Year. Effective for Plan Years beginning on and after January 1,
2002, Employer matching contributions shall be taken into account for purposes
of satisfying the minimum contribution requirements of section 416(c)(2) of the
Code and the Plan. The preceding sentence shall apply with respect to matching
contributions under the Plan or, if the Plan provides that the minimum
contribution requirement shall be met in another plan, such other plan. Employer
matching contributions that are used to satisfy the minimum contribution
requirements shall be treated as matching contributions for purposes of the
actual contribution percentage test and other requirements of section 401(m) of
the Code.
Contributions
considered under the first paragraph of this Section 11.03 will include the
contributions described above under this Plan and contributions under all other
defined contribution plans required to be included in an Aggregation Group (as
defined in Section 11.07), but will not include any plan required in such
aggregation group if the Plan enables a defined contribution plan required to be
included in such group to meet the requirements of the Code prohibiting
discrimination as to contributions or benefits in favor of Employees who are
officers, shareholders, or the highly compensated or prescribing the minimum
participation standards.
Contributions
considered under this Section will not include any contributions under the
Social Security Act or any other federal or state law.
|
4.
|
Except
as hereby amended, the provisions of the Plan as in effect prior to this
amendment shall continue unchanged.
|
IN
WITNESS WHEREOF, the Board of Directors has adopted this amendment effective as
stated above. This amendment may be executed in any number of
counterparts and all of such counterparts taken together shall be deemed to
constitute one and the same instrument.
Dated at
Las Vegas, Nevada, this 18th day of
September 2007.
|
SOUTHWEST
GAS CORPORATION
|
||
|
/s/
JEFFREY W. SHAW
|
||
|
Jeffrey
W. Shaw
|
||
|
Chief
Executive Officer
|
2
NINTH
AMENDMENT TO THE 2001
AMENDED
AND RESTATED SOUTHWEST GAS CORPORATION
EMPLOYEES’ INVESTMENT
PLAN
The
Southwest Gas Corporation Employees’ Investment Plan (the “Plan”) is hereby
amended pursuant to Plan Section 9.01, as follows:
|
1.
|
Effective
April 1, 2008, Section 8.08 of the Plan is amended to read as
follows:
|
Payment of
Expenses
The
members of the Committee will serve without compensation for their
services. The compensation or fees of accountants and other
specialists and any other costs of administering the Plan or Trust Fund will be
paid by the Trust Fund or (if such costs are incurred for the benefit of
individual Participants and the Committee determines that the allocation to
individual Participants is reasonable) the Participant, unless paid by the
Company in its discretion.
|
2.
|
Effective
April 1, 2008, Schedule A, “Investment
Plans” is amended to read as
follows:
|
Schedule
A -- Investment Plans
|
Investment
Funds
|
||
|
Southwest
Gas Stock Fund
|
||
|
Fidelity
U.S. Bond Index Fund
|
||
|
Fidelity
Money Market Trust - Retirement Money Market Portfolio
|
||
|
Fidelity
U.S. Government Reserves
|
||
|
Fidelity
Contrafund
|
||
|
Fidelity
Asset Manager - Growth (Terminated effective as of
March 1, 2007)
|
||
|
Fidelity
Growth & Income Portfolio (Closed June 3, 2008 and
terminated effective as of August 4, 2008)
|
||
|
Fidelity
Low Priced Stock Fund
|
||
|
Fidelity
Freedom Funds (All
Freedom Fund investment options are available effective as of March 1,
2007)
|
||
|
Vanguard
Index 500 - Admiral Shares (Vanguard Index 500 -
Institutional Shares effective as of February 1,
2007)
|
||
|
Vanguard
World International Growth Fund - Admiral Shares
|
||
|
Brown
Capital Management, Inc.- Small Company Institutional
Fund
|
||
|
Lord
Abbett Small Cap Value Fund
|
||
|
Eaton
Vance Large-Cap Value Fund Class I (Effective as of June
3,2008)
|
Designation of Investment
Funds
A
Participant’s Deferrals, Excess Contributions/Deferrals, and Rollover
Contributions may be invested entirely at his discretion, in increments of one
percent (1%), among the Investment Funds. In the complete absence of
any designation, the Participant’s Deferrals, Excess Contributions/Deferrals
and/or Rollover Contributions will be invested in the Fidelity Freedom Fund that
most closely corresponds to the Participant’s targeted retirement
date.
A
Participant’s Company Matching Contributions Account will be invested in the
Southwest Gas Stock Fund as provided for in Section 4.03 of the Plan, and the
rules in (b) below relating to transfers between Investment Funds.
Transfer Between and Among
Investment Funds
|
|
(a)
|
A
Participant may transfer amounts representing his Deferrals and Excess
Contributions/Deferrals, and Rollover Contribution from one Investment
Fund to another, daily. Transfer of amounts from the Southwest
Gas Stock Fund to another Investment Fund will be subject to the
requirement that fifty percent (50%) of all funds invested in the ESOP
remain invested in Employer Securities and the rules in (b)
below.
|
Further,
transfer of amounts to or from the Southwest Gas Stock Fund by Participants who
are subjected to Section 16 or the Securities Exchange Act of 1934, as amended,
may only make such transfers six (6) months following the date of the most
recent “opposite way” transfer.
|
|
(b)
|
Once
Company Matching Contributions are deposited in a Participant’s Company
Matching Contribution Account, a Participant may immediately transfer such
contributions to other Investment Funds. Upon reaching age fifty (50), a
Participant may elect to invest future Company Matching Contributions
directly in any other Investment Fund, in accordance with Section 4.03 and
(a) above.
|
|
|
(c)
|
The
investment of a Participant’s entire Account Balance is subject to the
rules of Section 7.02 once the Participant becomes entitled to a
distribution pursuant to Section
7.02.
|
|
3.
|
Except
as hereby amended, the provisions of the Plan as in effect prior to this
amendment shall continue unchanged.
|
IN
WITNESS WHEREOF, the Committee has adopted this amendment effective as
stated
2
above. This
amendment may be executed in any number of counterparts and all of such
counterparts taken together shall be deemed to constitute one and the same
instrument.
Dated at
Las Vegas, Nevada, this 31st day of
March 2008.
BENEFITS
COMMITTEE
|
/s/
GEORGE C. BIEHL
|
/s/ THOMAS R.
SHEETS
|
||
|
George
C. Biehl
|
Thomas
R. Sheets
|
||
|
/s/ JAMES P.
KANE
|
|||
|
James
P. Kane
|
3
TENTH
AMENDMENT TO THE 2001
AMENDED
AND RESTATED SOUTHWEST GAS CORPORATION
EMPLOYEES’ INVESTMENT
PLAN
The
Southwest Gas Corporation Employees’ Investment Plan (the “Plan”) is hereby
amended pursuant to Plan Section 9.01, as follows:
|
1.
|
Effective
July 1, 2008, subsection (a) of the definition of Compensation of
the Plan is amended to read as
follows:
|
|
|
(a)
|
For
purposes of determining an Eligible Employee’s benefits under the Plan,
the actual wages paid to an Eligible Employee during the applicable
period, including sales incentive payments and elective contributions that
are not includible in gross income under Code Sections 125, 402 and
403(b), but excluding flexible benefit dollars, bonuses, or other special
payments, and the Company’s contributions toward insurance, retirement,
and other fringe benefits or employee welfare plans or programs other than
severance pay arrangements.
|
|
2.
|
Effective
July 1, 2008, Section 3.01(b) of the Plan is amended to read as
follows:
|
|
|
(b)
|
Unmatched
Deferrals.
|
Participant
making Matched Deferrals at the maximum percentage rate may elect to further
reduce his Compensation in a fixed whole percentage of not less than one percent
(1%) and not more than fifty-three percent (53%) or the cash compensation
payable to the Participant after all other applicable withholdings. The Company will make
payments to the Plan within the time frame required by applicable laws and
regulations of the amount of the reduction to be credited to the Participant's
Deferral Account. Amounts deferred under this subsection will be
contributed as Unmatched Deferrals.
|
3.
|
Effective
July 1, 2008, Section 3.02(a) of the Plan is amended to read as
follows:
|
|
|
(a)
|
The
Company will, on behalf of eligible Participants, contribute an amount
which equals the sum of the amounts to be allocated to the Company
Matching Contributions Account of each eligible
Participant. The amount allocated to the Company Matching
Contributions Account for each eligible Participant will equal fifty
percent (50%) of the eligible Participant's Matched Deferrals, excluding
the deferral of pay for overtime hours, plus forfeitures allocated under
Section 3.07. The maximum Company Matching Contribution under
this Plan equals equals three and one-half percent (3½%) of a
Participant's Compensation. For purposes of this Section
3.02(a), the term "eligible Participant" means any Participant other than
a Participant who is an officer of the Company or who has been selected to
participate in the
|
Company’s
executive deferral plan.
|
4.
|
Effective
June 24, 2008, Section 8.01 of the Plan is amended to read as
follows:
|
The Plan
shall be administered by a Committee appointed by the chief executive officer of
the Company, subject to the approval of the Board. The Committee
shall be composed of no more than five and no fewer than three members who shall
hold office at the pleasure of the Board. Such members may, but need
not, be Employees. Any person appointed a member of the Committee
shall, at the request of the Company’s chief executive officer, signify
acceptance by filing a written acceptance with the Secretary of the
Committee. Any member of the Committee may resign by delivering a
written resignation to the chief executive officer of the Company and the
Secretary of the Committee. Such resignation shall be effective no
earlier than the date of the written notice. If a member of
the Committee is an Employee of the Company, he shall be deemed to
have resigned upon his termination of employment with the
Company. The Board or the chief executive officer of the Company, may
remove one or more members of the Committee at any time.
|
5.
|
Except
as hereby amended, the provisions of the Plan as in effect prior to this
amendment shall continue unchanged.
|
IN
WITNESS WHEREOF, the Committee has adopted this amendment effective as stated
above. This amendment may be executed in any number of counterparts
and all of such counterparts taken together shall be deemed to constitute one
and the same instrument.
Dated at
Las Vegas, Nevada, this 24th day of
June 2008.
BENEFITS
COMMITTEE
|
/s/
GEORGE C. BIEHL
|
/s/ THOMAS R.
SHEETS
|
||
|
George
C. Biehl
|
Thomas
R. Sheets
|
||
|
/s/ JAMES P.
KANE
|
|||
|
James
P. Kane
|
2
ELEVENTH
AMENDMENT TO THE 2001
AMENDED
AND RESTATED SOUTHWEST GAS CORPORATION
EMPLOYEES’ INVESTMENT
PLAN
The
Southwest Gas Corporation Employees Investment Plan (the “Plan”) is, pursuant to
Plan Section 9.01, hereby amended by this Eleventh Amendment (the “Amendment”)
to the Plan. This Amendment amends the Plan to comply with the final
Internal Revenue Code Section 415 regulations, and selected provisions of the
Pension Protection Act of 2006.
|
1.
|
The Plan’s definition
of “Compensation” as modified by the First and Tenth Amendments to the
Plan, is further amended effective January 1, 2008, to read as
follows:
|
Compensation
means:
|
|
(a)
|
For
purposes of determining an Eligible Employee’s benefits under the Plan,
the actual wages paid to an Eligible Employee during the applicable
period, including sales incentive payments and elective contributions that
are not includible in gross income under Code Sections 125, 402 and
403(b), but excluding flexible benefit dollars, bonuses, or other special
payments, and the Company’s contributions toward insurance, retirement,
and other fringe benefits or employee welfare plans or programs other than
severance pay arrangements.
|
|
|
(b)
|
For
purposes of Section 3.04, Section 3.05, Section 3.06, and Article 11 only,
an Eligible Employee’s earned income, wages, salaries, fees for
professional services, and other amounts received for personal services
actually rendered in the course of employment with the Company (including,
but not limited to, overtime, other special payments, bonuses, incentive
compensation, commissions on insurance premiums, or tips), whether
actually paid in cash or in kind during the Plan Year by the Company,
excluding:
|
|
|
(i)
|
Company
contributions to a plan of deferred
compensation;
|
|
|
(ii)
|
Any
group insurance or other health and welfare plan maintained by the
Company;
|
|
|
(iii)
|
Distributions
from a plan of deferred
compensation;
|
|
|
(iv)
|
Any
amounts realized from the exercise of a nonqualified stock
option;
|
|
|
(v)
|
The
sale, exchange, or other disposition of stock acquired under a qualified
stock option;
|
(vi) Other
amounts that receive special tax benefits; or
|
|
(vii)
|
Any
contributions made toward the purchase of an annuity described in Code
Section 403(b) whether or not such amounts are actually excludible from
the gross income of the Eligible
Employee.
|
In no
event shall a Participant’s Compensation include amounts paid to the Participant
after the Participant’s severance from employment, unless such amounts are paid
to the Participant before the later of (i) the end of the Limitation Year in
which the Participant’s severance from employment occurs or (ii) within two and
one-half (22)
months of the date the Participant’s severance from employment occurs and such
amounts (i) would otherwise have been paid to the Participant in the course of
the Participant’s employment and are regular compensation for services during
the Participant’s regular working hours, compensation for services outside the
Participant’s regular working hours (such as overtime or shift differential
pay), commissions, bonuses, or other similar compensation, (ii) are payments for
accrued bona fide sick, vacation or other leave, but only if the Participant
would have been able to use such leave if the Participant’s employment had
continued, or (iii) are payments received by the Participant pursuant to a
non-qualified, unfunded deferred compensation plan, to the extent such payments
are includible in income and the Participant would have received such payments
at the same time if the Participant had continued in employment. For purposes of
this paragraph, a Participant will not be considered to have severed employment
if the Participant’s new employer continues to maintain the Plan with respect to
such Participant.
Compensation
will mean only Compensation actually paid or includible in gross income in the
Plan Year. In no case will amounts deferred pursuant to Code Section
125 be included as Compensation under this subsection (b).
Notwithstanding
any language in this subsection (b) to the contrary, effective for Plan Years
beginning after December 31, 1996, “Compensation” for the purpose described in
this subsection shall include an Eligible Employee's elective deferrals under
Code Section 402(g)(3), and amounts that pursuant to Code Sections 125 or 457
are contributed or deferred (at the Eligible Employee's election) and are not
includible in the Eligible Employee's gross income in the tax year contributed
or deferred. Notwithstanding any language in this subsection (b) to
the contrary, effective for Plan Years beginning after December 31, 1996,
“Compensation” for the purpose described in this subsection shall include an
Eligible Employee's elective deferrals under Code Section 402(g)(3), and amounts
that pursuant to Code Sections 125 or 457 are contributed or deferred (at the
Eligible Employee's election) and are not includible in the Eligible Employee's
gross income in the tax year contributed or deferred. Notwithstanding
any provision of this Plan
2
to the
contrary, the following sentence that includes the model language of Internal
Revenue Service Notice 2001-37 shall apply on and after January 1,
2001. For Plan Years beginning on and after January 1, 2001, for
purposes of applying the limitations described in Section 3.06, the top-heavy
plan rules of Article 11, the Section 3.05(a) of “Compensation Percentage” and
the Section 3.04(a) definition of “Actual Deferral Percentage” Compensation paid
or made available during such Plan Years shall include elective amounts that are
not includible in the gross income of the employee by reason of Code Section
132(f)(4).
|
|
(c)
|
The
annual Compensation taken into account under the Plan for any Plan Year
beginning on or after January 1, 1989, shall not exceed the maximum dollar
amount ($200,000 for the year beginning in 1989 and any other amount that
applies for a later year, including the limit of $150,000 that applies for
the year beginning in 1994 and $200,000 for the year beginning January 1,
2002) that is permitted as of the beginning of the year under Code Section
401(a)(17) (determined after giving effect to any statutory changes
affecting Code Section 401(a)(17) and any indexing or other adjustments
pursuant to Code Section 401(a)(17) that are applicable for the year of
the determination). In the case of a short Plan Year or other
period of less than 12 months requiring a reduction of the Code Section
401(a)(17) annual limit, the otherwise applicable limit shall be prorated
by multiplying it by a fraction, the numerator of which is the number of
months in the short period and the denominator of which is
12. Moreover, effective January 1, 1987, to December 31,
1996, in determining an Employee's Compensation for purposes of the Code
Section 401(a)(17) limit, the rules of Code Section 414(q)(6) (requiring
the aggregation of Compensation paid to family members of certain Five
Percent Owners and the ten most highly compensated Employees) shall apply,
except that in applying such rules, the term "family" shall include only
the Spouse of the Employee and any lineal descendants of the Employee who
have not attained age 19 before the close of the year. If, as a
result of the application of such rules, the adjusted annual Code Section
401(a)(17) Compensation limit is exceeded, then such limit shall be
prorated among the affected individuals in proportion to each such
individual's Compensation as determined prior to the application of the
Code Section 401(a)(17) limit.
|
Effective
for Plan Years beginning after December 31, 1996, the aforesaid family
aggregation rules shall no longer apply.
|
2.
|
Plan
Section 2.02 is amended effective January 2, 2009, to read as
follows:
|
Participation in the
Plan
|
|
(a)
|
An
Eligible Employee shall become a Participant following initial hire on
the
|
3
Entry
Date coincident with or first following successful completion of enrollment in
the Plan, in the manner designated by the Committee from time to
time.
|
|
(b)
|
An
Eligible Employee who was hired after January 2, 2009, and has not
enrolled in the Plan as provided for in subparagraph (a) above, will
automatically become a Participant on or before the Entry Date coincident
with or first following thirty (30) days from the date the Plan’s
record-keeper receives the Eligible Employee’s employment information from
the Company, unless the Eligible Employee elects before such date, in the
manner designated by the Committee from time to time, not to participate
in the Plan.
|
|
|
(c)
|
An
Eligible Employee who was hired before January 2, 2009, and has never
enrolled in the Plan, will automatically become Participant on February 1,
2009, unless the Eligible Employee elects before such date, in a manner
designated by the Committee from time to time, not to participate in the
Plan.
|
|
|
(d)
|
By
becoming a Participant, the Eligible Employee authorizes the Company to
withhold such reductions from his Compensation and pay said amounts to the
Trustee. Becoming a Participant also allows the Plan to
designate (i) how said Deferrals will be allocated between the Investment
Funds and (ii) who will be the Beneficiaries, unless otherwise directed by
the Participant in the manner designated by the Committee, from time to
time.
|
|
3.
|
Plan
Section 3.01(a), as modified by the Eighth Amendment to the Plan, is
further amended effective January 1, 2008, with respect to the last
sentence of the section and January 2, 2009, with respect to automatic
enrollment, to read as follows:
|
|
|
(a)
|
Matched
Deferrals
|
Upon
enrollment or reenrollment in the Plan under Section 2.02(a), each Participant
must elect to reduce his Compensation in a fixed whole percentage of not less
than two percent (2%) and not more than seven percent
(7%). Upon automatic enrollment in the Plan under Section 2.02(b) or
(c), the Participant shall be deemed to have elected and authorized the Company
to initially reduce his Compensation by three percent (3%). In each
subsequent Plan Year, the reduction will be automatically increased by one
percentage point until the reduction reaches a maximum of seven percent (7%)
Compensation, unless and until the Participant makes an affirmative election
either to not have such reduction made or to select a different allowable level.
The Company will make payments to the Plan within the time frame required by
applicable laws and regulations of the amount of the reduction, to be credited
to the Participant's Deferral Account. Amounts deferred under this
subsection will be contributed as Matched Deferrals. Notwithstanding any other
language to this Plan to the contrary, Participant
4
deferrals
shall not be allowed on Compensation that is not compensation
within
the meaning of Code Section 415(c)(3) and the regulations
thereunder.
|
4.
|
Plan
Section 3.01(b), as modified by the Seventh and Tenth Amendment to the
Plan, is further amended effective January 1, 2008, to read as
follows:
|
|
|
(b)
|
Unmatched
Deferrals
|
Participant
making Matched Deferrals at the maximum percentage rate may elect to further
reduce his Compensation in a fixed whole percentage of not less than one percent
(1%) and not more than fifty-three percent (53%) or the cash compensation
payable to the Participant after all other applicable withholdings. The Company will make
payments to the Plan within the time frame required by applicable laws and
regulations of the amount of the reduction to be credited to the Participant's
Deferral Account. Amounts deferred under this subsection will be
contributed as Unmatched Deferrals. Notwithstanding any other
language to this Plan to the contrary, Participant deferrals shall not be
allowed on Compensation that is not compensation within the meaning of Code
Section 415(c)(3) and the regulations thereunder.
|
5.
|
Plan
Section 3.03(d)(ii) is amended effective January 1, 2007, to read as
follows:
|
|
|
(d)
|
Treatment of Excess
Deferrals
|
|
|
(ii)
|
The
Trust Fund investment earnings or losses attributable to a Participant’s
Excess Deferrals shall be the sum of the allocable gain or loss to the
Participant’s Deferral Account for the preceding Plan Year and to the
extent the Excess Deferrals are or will be credited with gain or loss for
the period after the close of the Plan Year and prior to the distribution
(hereinafter the “Gap Period”) if the total account were to be
distributed, the allocable gain or loss during the Gap
Period. Income or loss allocable to the Participant's Deferral
Account for the preceding Plan Year shall be determined by multiplying
such income or loss by a fraction the numerator of which is the
Participant's Excess Deferrals for the preceding Plan Year and the
denominator of which is the balance in the Participant's Deferral Account
on the first day of the preceding Plan Year increased by the Participant’s
Deferrals for the preceding Plan Year. Income on Excess Deferrals for the
Gap Period shall equal the product obtained by multiplying ten percent
(10%) of the income allocable to Excess Deferrals, as calculated pursuant
to the preceding sentence, by the number of calendar months that have
elapsed since the end of the Plan Year B
a corrective distribution that is made before the fifteenth day of a month
is treated as made on the last day of the
preceding
|
5
month and
a distribution made after the fifteenth day of a month is treated as made on the
first day of the next month.
|
6.
|
Plan
Section 3.04(c)(ii), as modified by the First Amendment to the Plan, is
further amended effective January 1, 2006, to read as
follows:
|
|
|
c)
|
Treatment of Excess
Contributions
|
|
|
(ii)
|
In
the event that the Deferrals allocated to Higher Compensated Employees for
any Plan Year result in Excess Contributions, the Committee shall direct
the Trustee to distribute the Excess Contributions, adjusted for any
applicable Trust Fund investment income or loss thereon, to the affected
Higher Compensated Employees by March 15 following the Plan Year in which
the Excess Contributions occurred but in no event later than the close of
the Plan Year following the Plan Year in which the Excess Contributions
occurred. To determine the amount of Excess Contributions with
respect to Participants who are Higher Compensated Employees, the
Committee or its designee, will perform the following computation (which
shall be used solely to determine the aggregate amount to be distributed,
and not the amount to be distributed to any individual): first, the Annual
Deferral Ratio of the Higher Compensated Employee with the highest Annual
Deferral Ratio shall be reduced to the extent necessary to (A) enable the
Plan to satisfy the Code Section 401(k)(3) limits or (B) cause such
Employee's Annual Deferral Ratio to equal the Annual Deferral Ratio of the
Higher Compensated Employee with the next highest Annual Deferral Ratio.
Next, the Committee, or its designee, will repeat this process until the
Plan satisfies the Code Section 401(k)(3) limits. Once the aggregate
amount of reductions is determined under the preceding sentence, such
amount shall be distributed in the manner described in the remainder of
this Section 3.04(c)(ii). Notwithstanding the foregoing, the calculation
and/or distribution of Excess Contributions shall be made in a manner that
satisfies Treasury Regulation Section 1.401(k)-2, the terms of which are
hereby incorporated by reference.
|
The
Committee shall direct the Trustee to make the distribution on a uniform
basis. It shall first be made with respect to Higher Compensated
Employees with the highest Actual Deferral Ratio for the Plan Year and then with
respect to Higher Compensated Employees with the next highest Actual Deferral
Ratio for the Plan Year and so on, in descending order from the highest rate
until the test in Section 3.04(b) is satisfied.
6
For the
purposes of this subsection, the phrase “Actual Deferral Ratio” shall, for Plan
Years beginning after December 31, 1996, refer to the dollar amount of such
Deferrals and for Plan Years beginning before January 1, 1997, shall mean the
Actual Deferral Ratio of a Higher Compensated Employee.
The
portion of the Excess Contributions applicable to each Higher Compensated
Employee shall be distributed to the Higher Compensated Employee in a single
payment. The portion of each Higher Compensated Employee's Excess
Contributions that is to be distributed in accordance with this Section 3.04
shall be reduced by any Excess Deferrals previously distributed to the Higher
Compensated Employee with respect to the same Plan Year under Section
3.03.
|
7.
|
Section
3.05(e)(i) is amended effective January 1, 2006, to read as
follows:
|
|
|
(e)
|
Treatment of Excess
Aggregate Contributions
|
|
|
(i)
|
In
the event that the Company’s Section 3.02 matching contributions (and
Deferrals, if the Company makes a section 3.05(d) election) allocated to
Higher Compensated Employees for any Plan Year result in Excess Aggregate
Contributions, the Committee shall direct the Trustee to distribute the
Excess Aggregate Contributions, adjusted for any applicable Trust Fund
investment income or loss thereon, to the Higher Compensated Employees
with the highest Contribution Percentage, if they are Vested in the
amounts, by March 15 following the Plan Year in which the Excess Aggregate
Contributions occurred but in no event later than the close of the Plan
Year following the Plan Year in which the Excess Aggregate Contributions
occurred. If the affected Higher Compensated Employees are not
Vested in such amounts, the Committee shall direct the Trustee to treat
the nonvested portion of the Excess Aggregate Contributions as a
forfeiture (allocable to the Plan Year in which the Excess Aggregate
Contributions occurred) and allocate them according to the rules in
Section 6; provided, however, that no amount of the forfeited Excess
Aggregate Contributions shall be allocated to a Higher Compensated
Employee whose share of Company Section 3.02 matching contributions (and
Deferrals, if the Company makes a Section 3.05(d) election) is adjusted
under this Section 3.05.
|
To
determine the amount of Excess Aggregate Contributions, the Committee, or its
designee, will perform the following computation (which shall be used solely to
determine the aggregate amount to be forfeited or distributed and not the amount
to be forfeited by or
7
distributed
to any individual): first, the Contribution Percentage of the Higher Compensated
Employee with the highest CPR shall be reduced to the extent necessary to (A)
enable the Plan to satisfy the Code Section 401(m) limits or (B) cause such
Employee's Compensation Percentage to equal the Compensating Percentage of the
Higher Compensated Employee with the next highest Compensation Percentage, and
then this process will be repeated until the Plan satisfies the Code Section
401(m) limits. In no event will Excess Aggregate Contributions remain
unallocated or be allocated to a suspense account for allocation in a future
Plan Year. The aggregate amount of reductions determined under the preceding
sentence shall be distributed, first, to the Higher Compensated Employees with
the highest dollar amounts of Company Section 3.02 matching contributions (and
any Deferrals taken into account in computing Participant’s Compensation
Percentage), pro rata, in an amount equal to the lesser of (A) the total amount
of Excess Aggregate Contributions for the Plan Year determined under the
preceding sentence or (B) the amount necessary to cause the amount of such
Company Section 3.02 matching contributions (and any Deferrals taken into
account in computing the Participant’s Compensation Percentage) to equal the
amount of the Company’s Section 3.02 matching contributions (and any Deferrals
taken into account in computing the Compensation Percentage) of the Higher
Compensated Employees with the next highest dollar amount of matching
contributions (and any Deferrals taken into account in computing such employees’
Compensation Percentages); this process is repeated until the aggregate amount
distributed equals the amount of Excess Aggregate Contributions determined under
the preceding sentence.
The
portion of the Vested Excess Aggregate Contributions applicable to each Higher
Compensated Employee shall be distributed to the Higher Compensated Employee in
a single payment. If the Company has elected under Section 3.05(d) to
count Deferrals in the determination of Excess Aggregate Contributions, the
portion of the Excess Aggregate Contributions applicable to each Higher
Compensated Employee that is to be distributed or forfeited in accordance with
this Section 3.05 shall be reduced by any Excess Deferrals and Excess
Contributions previously distributed to the Higher Compensated Employee with
respect to the same Plan Year under Sections 3.03 and 3.04.
|
8.
|
Plan
Section 3.06(c) is deleted from the Plan and Section 3.06(d) is renumbered
and amended effective January 1, 2008, to read as
follows:
|
8
|
|
(c)
|
Treatment of Excess
Annual Additions
|
In the
event that it is determined that the Annual Additions to a Participant's
Accounts, for any Plan Year, or any other defined contribution plan of Employer,
would be in excess of the limitations contained herein, then the limit shall be
satisfied using any appropriate correction method provided under the Employee
Plans Compliance Resolution System, or any successor program.
|
9.
|
Plan
Section 4.02 is amended effective January 2, 2009, to read as
follows:
|
Investment
Funds
|
|
(a)
|
Upon
enrollment or reenrollment, each Participant will have his Accounts
invested in the Trust Fund. The Trust Fund will consist of
those Investment Funds described in Schedule A attached to this Plan and
incorporated as part of the Plan. Each Participant will have
the right upon enrollment, reenrollment, and during participation, to
elect the Investment Fund(s) under which future contributions to his
Deferral Account, Rollover Account and Frozen After Tax Account will be
invested, by making such election in the manner designated by the
Committee from time to time. The election will include the
percentage, subject to the restrictions in Schedule A, of future
contributions to be invested in each Investment Fund, with the total of
the percentages equal to one hundred percent (100%). Such
election for future contributions will be effective as soon as
administratively practicable on or after the Business Day such election is
received by the Committee and/or its
designee.
|
|
|
(b)
|
A
Participant automatically enrolled in the Plan under Sections 2.02(b) or
(c) shall be deemed to have elected to invest his Deferral Account in an
age- appropriate Fidelity Freedom Fund, or other equivalent Investment
Fund as designated by the Committee in Schedule A, commensurate with the
age of the Participant at the time of automatic enrollment, unless and
until the Participant makes an affirmative election to cease participation
or change the Investment Fund into which future contributions are to be
invested.
|
|
|
(c)
|
In
addition, each Participant will also have the right to have all or any
part of his Deferral Account, Rollover Account or Frozen After Tax Account
transferred among and between the Investment Fund(s), subject to the
restrictions set forth in Schedule A. Transfers in a
Participant’s Accounts will take place as soon as administratively
practicable on or after the
Business
|
Day such
election is received by the Committee and/or its designee. The
Committee may create alternative rules allowing for such transfers.
9
|
|
(d)
|
Except
for Participant Deferrals invested in Employer Securities and as provided
in Section 4.03 below, the Committee will exercise voting, tender, and
other rights with respect to the Investment
Funds.
|
|
10.
|
Plan
Section 5 is amended effective January 2, 2009, with the addition of a new
Section 5.06 titled “Withdrawal of Automatic Enrollment Contributions,”
which will read as follows:
|
Withdrawal of Automatic
Enrollment Contributions
A
Participant who is automatically enrolled in the Plan under Sections 2.02(b) or
(c) will be permitted to withdraw all contributions to his Deferral Account,
provided such request is made in the manner designated by the Committee from
time to time, no later than ninety (90) days following the first contribution to
his Deferral Account. Upon such permitted withdrawal, the
Participant’s Company Matching Contributions Account, including allocated
forfeitures, shall be forfeited, unless otherwise Vested.
|
11.
|
Plan
Section 7.03 is amended effective November 1, 2008, to read as
follows:
|
Eligible Rollover
Distributions
Notwithstanding
any provision of the Plan to the contrary that would otherwise limit a
distributee’s election under this Article 7, effective for distributions made on
or after January 1, 1993, 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. For purposes of this Section, the
following definitions shall apply.
An
“eligible rollover distribution”, effective January 1, 2000, shall mean a
distribution described in Code Section 402(c)(4). After December 31,
2001, the term “eligible rollover distribution” shall include after-tax employee
contributions which are not includible in gross income (provided, that such
contributions may be transferred only to an individual retirement account or
annuity described in Code Sections 408(a) or (b), or a qualified defined
contribution plan described in Code Sections 401(a) or 403(a) that agrees to
separately account for 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); and exclude any amount
that is distributed on account of hardship, as provided for in Section 5.04 of
the Plan, shall not be an eligible rollover distribution and the distributee may
not elect to have any portion of such a distribution paid directly to an
eligible retirement plan.
An
“eligible retirement plan” is an individual retirement account described in
Section 408(a), an individual retirement annuity described in Code Section
408(b), an annuity plan described in Code Section 403(a), a qualified Trust, an
annuity contract described in Code Section 403(b) and an eligible plan under
Code Section 457(b),
10
which is
maintained by an eligible employer described in Code Section 457(e)(1)(A).
However, in the case of an eligible rollover distribution to the non-spousal
Beneficiary, an “eligible retirement plan” is an individual retirement plan that
is treated as an inherited individual retirement account or individual
retirement annuity.
A
“distributee” includes a Participant or former Participant, the Participant’s or
former Participant’s surviving Spouse or former Spouse who is the Alternate
Payee under a Qualified Domestic Relations Order and the Participant’s or former
Participant’s non-spousal Beneficiaries.
A “direct
rollover” is a payment by the Plan to the eligible retirement plan specified by
the distributee.
In
prescribing the manner of making elections with respect to eligible rollover
distributions, as described above, the Committee may provide for the uniform,
nondiscriminatory application of any restrictions permitted under applicable
Sections of the Code and related rules and regulations, including a requirement
that a distributee may not elect a partial direct rollover in an amount less
that $500 and a requirement that a distributee may not elect to make a direct
rollover from a single eligible rollover distribution to more than one eligible
retirement plan. Moreover, if a distribution is one to which Sections
401(a)(11) and 417 of the Code do not apply, such distribution may commence less
than 30 days after the notice required under Section 1.411(a)-11(c) of the
Income Tax Regulations is given, provided that:
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|
(a)
|
The
Trustee clearly informs the Participant that the Participant has a right
to a period of at least thirty (30) days after receiving the notice to
consider the decision of whether or not to elect a distribution (and, if
applicable, a particular distribution option),
and
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|
|
(b)
|
The
Participant, after receiving the notice, affirmatively elects a
distribution.
|
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12.
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Except
as hereby amended, all terms used in this Amendment shall have the same
meaning as in the Plan and all provisions of the Plan as in effect prior
to this amendment shall continue
unchanged.
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/ /
/
/ /
/
/ /
/
11
IN
WITNESS WHEREOF, the Committee has adopted this amendment effective as stated
above. This amendment may be executed in any number of counterparts
and all of such counterparts taken together shall be deemed to constitute one
and the same instrument.
Dated at
Las Vegas, Nevada, this 8th day of
October 2008.
BENEFITS
COMMITTEE
|
/s/
GEORGE C. BIEHL
|
/s/ KAREN S.
HALLER
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||
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George
C. Biehl
|
Karen
S. Haller
|
||
|
/s/ JAMES P.
KANE
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|||
|
James
P. Kane
|
12
EXHIBIT
5.1
November
21, 2008
Southwest
Gas Corporation
5241
Spring Mountain Road
Las
Vegas, NV 89150
Ladies
and Gentlemen:
As
counsel for Southwest Gas Corporation (the “Company”), I have examined the
Registration Statement on Form S-8 to be filed by the Company with the
Securities and Exchange Commission, in connection with the registration under
the Securities Act of 1933, as amended, of 1,000,000 shares of the Company’s $1
par value Common Stock (the “Stock”) pursuant to the provisions of the Company’s
Employees’ Investment Plan. I also have examined the steps taken by
the Company and its Board of Directors in connection with the authorization and
proposed issuance and sale of the Stock, and I am familiar with resolutions
adopted by the Board of Directors of the Company. I am also familiar
with the application filed by the Company with the California Public Utilities
Commission for authority to issue the Stock, and the orders issued by said
Commission authorizing the issuance of same.
Based on
the foregoing and upon such other matters as I deem relevant in the
circumstances, it is my opinion that the Company has received all required
authorizations from state regulatory agencies having jurisdiction over the
issuance of the Stock by the Company. Subject to the actions
authorized by the Company’s Board of Directors, the Stock, upon issuance and
sale thereof in the manner specified in the Registration Statement, will be duly
authorized, legally and validly issued, fully paid, and nonassessable
outstanding Stock of the Company.
I hereby
consent to the filing of this opinion as an exhibit to the Registration
Statement, and I further consent to the use of my name under the caption
“Interests of Named Experts and Counsel” in the Registration Statement and the
Prospectus which forms a part thereof.
Respectfully
submitted,
/s/
ROBERT M. JOHNSON
Robert M.
Johnson
Consent
of Independent Registered Public Accounting Firm
We hereby
consent to the incorporation by reference in this Registration Statement on Form
S-8 of our report dated February 28, 2008
relating to the financial statements, and the effectiveness of internal control
over financial reporting, which appears in Southwest Gas Corporation's Annual
Report on Form 10-K for the year ended December 31, 2007. We also
consent to the references to us under the heading “Interests of Named Experts
and Counsel” in such Registration Statement.
We also
consent to the incorporation by reference in this Registration Statement of our
report dated June 25, 2008 relating to the financial statements, which appears
in the Annual Report of Southwest Gas Corporation Employees' Investment Plan on
Form 11-K for the year ended December 31, 2007.
/s/
PricewaterhouseCoopers LLP
Los
Angeles, California
November 21,
2008
ISSUANCE
AND SALE OF COMMON STOCK THROUGH
THE
EMPLOYEES’ INVESTMENT PLAN
WHEREAS,
The Board of Directors of Southwest Gas Corporation (the “Corporation”) has
determined that it is in the best interests of the Corporation to reserve an
additional 1,000,000 shares of original issue common stock (the “Additional
Shares”) to use as an investment and funding option in the Employees’ Investment
Plan (the “EIP”); and
WHEREAS,
The Corporation has existing authorization from the California Public Utilities
Commission to reserve, issue and sell the contemplated level of Additional
Shares through the EIP.
NOW,
THEREFORE, BE IT RESOLVED, That the Board of Directors of the Corporation
authorizes the reservation of the Additional Shares to be issued and sold from
time to time in accordance with the provisions of the EIP, subject to first
obtaining all required governmental authorizations therefore and in compliance
with other terms and conditions as are hereinafter specified in these
resolutions; and
RESOLVED
FURTHER, That the Chief Executive Officer; the President; the Chief Financial
Officer and Corporate Secretary; the Senior Vice President/Finance; the
Treasurer; the Chief Accounting Officer; Controller; and the Assistant Corporate
Secretary (collectively, the “Authorized Officers,” which term shall include
such officers, attorneys, agents, and employees as they may respectively
specify) are, and each of them hereby is, authorized to take such actions and
execute such instruments as they deem necessary and suitable in order to carry
out the intent and purpose of these resolutions and the execution by any such
Authorized Officer of any such instrument, or the undertaking by any of them of
any such action, in connection with the matters specified in these resolutions
shall conclusively establish their authority therefore from the Corporation and
the approval and ratification by the Corporation thereof; and
RESOLVED
FURTHER, That the Authorized Officers are, and each of them hereby is,
authorized and directed, to prepare, execute and cause to be filed with the
Securities and Exchange Commission (“SEC”) any required registration statements,
and all amendments and supplements thereto, for the purpose of registering under
the federal securities laws, the Additional Shares for issuance in accordance
with the provisions of the EIP; and
11/14/08
RESOLVED
FURTHER, That Jeffrey W. Shaw and George C. Biehl are, and each of them hereby
is, authorized to act severally as attorneys-in-fact for and on behalf of the
Corporation to execute and file registration statements on the applicable form
or forms and on behalf of the Corporation to execute and file any and all
amendments and/or supplements thereto to be filed by the Corporation with the
SEC under the federal securities laws, for the purpose of registering the
Additional Shares for issuance in accordance with the provisions of the EIP;
and
RESOLVED
FURTHER, That the Authorized Officers are, and each of them hereby is,
authorized in the name and on behalf of the Corporation to prepare and file, or
cause to be prepared and filed, applications for listing the Additional Shares
on the New York Stock Exchange and any other stock exchange or exchanges that
any of the Authorized Officers deems appropriate; and that the Authorized
Officers are, and each of them hereby is, authorized in the name and on behalf
of the Corporation to execute and deliver such applications and any listing
agreements or documents required by any such exchange in connection therewith,
and to make such changes in any of the same as may be necessary or appropriate
to conform with the requirements for listing, and to communicate with and to
appear (if requested) before the officials of any such exchange, and to file, or
cause to be filed, amendments or supplements to any of the foregoing documents
and take such other action that any Authorized Officer deems appropriate;
and
RESOLVED
FURTHER, That the
Additional Shares shall be executed on behalf of the Corporation by any one or
more of the Authorized Officers, under the corporate seal of the Corporation
reproduced or otherwise imprinted thereon, and shall be attested by the
Corporation’s Secretary or any of its Assistant Secretaries; that the signature
of each or both of such officers on the Additional Shares may be manual or
facsimile; that the Additional Shares bearing the manual or facsimile signatures
of individuals who were at the time the proper officers of the Corporation shall
bind the Corporation, notwithstanding that such individuals or any of them have
ceased to hold such offices prior to the authentication and delivery of the
Additional Shares or did not hold such offices at the dates of issuance of such
shares; and
11/14/08
2
RESOLVED
FURTHER, That the
Authorized Officers are, and each of them hereby is, authorized to pay any and
all expenses and fees arising in connection with the issuance and sale of the
Additional Shares, including, without limitation, qualification under the
Exchange Act or under securities or Blue Sky laws of any state or other
jurisdiction in which such shares are offered, any listings of the Additional
Shares on any exchange and otherwise in connection with matters contemplated by
these resolutions; and
RESOLVED
FURTHER, That the
Authorized Officers are, and each of them hereby is, authorized in the name and
on behalf of the Corporation to make all such arrangements, to do and perform
all such acts and things, and to execute and deliver all such officers’
certificates, financing documents, and such other instruments and documents as
any Authorized Officer deems necessary or appropriate in order to fully
effectuate the purposes of the foregoing resolutions and any action taken by
this Board; and
RESOLVED
FURTHER, That the Authorized Officers are, and each of them hereby is,
authorized and directed on behalf of the Corporation to execute and deliver, or
to cause to be executed and delivered, any and all agreements and documents
necessary to effectuate the foregoing resolutions, with such terms and such
changes therein as the Authorized Officers executing the same approve, with such
approval being conclusively determined by the execution thereof;
and
RESOLVED
FURTHER, That each of the Authorized Officers is hereby authorized and directed
on behalf of the Corporation to make, or cause to be made, such filings and to
take, or cause to be taken, such other actions as may be necessary to effectuate
the foregoing resolutions; and
RESOLVED
FURTHER, That all acts previously taken by each of the Authorized Officers in
order to effectuate the purposes of these resolutions are hereby confirmed and
ratified.
11/14/08
3