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Res 51-00RESOLUTION NO. 51-00 A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF DR1.RAY BEACH, FLORIDA, AMENDING RESOLUTION NO. 17-97 BY AMENDING THE LIST OF ELIGIBLE EMPLOYEES IN EXHIBIT "A" AND EXHIBIT "B" OF SAID RESOLUTION TO INCLUDE ,Al.I. EMPLOYEES RI.IGIBLE FOR THE CITY'S 3% MANAGEMENT MATCH PROGRAM; ADOPTING THE RESTATED ICMA-RC MODEL GOVERNMENT PLAN; PROVIDING FOR AN EFFECTIVE DATE. WHEREAS, the City of Delray Beach (the "City"), in addition to already established plans, established a Money Purchase Plan and Trust (Plan) for certain eligible management match employees as designated in Exhibit "A" to Resolution No. 17-97; and WHEREAS, the City still desires that the money purchase retirement plan be administered by the ICMA Retirement Corporation and that the funds held under such Plan be invested in the ICMA Trust, a Trust established by public employers for the investment of funds; and WHEREAS, the City still desires to provide a matching contribution for eligible employees as shown in the amended adoption agreement, subject to state and federal laws; and WHEREAS, however, the City desires to amend Exhibits "A" and "B" of Resolution No. 17-97 and hereby includes a new Ex}ubit "A" and Exhibit "B" to this resolution listing certain eligible management match employees; and WHEREAS, certain amendments to the U.S. Internal Revenue Code Tax Page Relief Act of 1997 have been enacted exempting public sector qualified retirement plans from nondiscrimination test requirements; and WHEREAS, in addition to the changes to Exhibits "A" and "B" describing the eligible management match employees, the City is also adopting the Restated ICMA-RC Model Government Plan and Trust. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF DF.I.RAY BEACH, FLORIDA, AS FOLLOWS: Section 1. That the City established a money purchase retirement plan (the "Plan") by adopting Resolution No. 17-97 in the form of: The ICMA Retirement Corporation Prototype Money Purchase Plan and Trust, pursuant to the provisions of the adoption agreement as set forth in Exhibit "B" attached thereto, and the City hereby adopts modified Exhibits "A", "B" and "C", as attached hereto. Section 2. That the City continues to contribute a three percent (3%) match to the Plan for participating eligible match employees. The participating eligible employees are described in the attached Exhibits "A" and "B". Section 3. That the City hereby adopts the Restated ICMA-RC Model Government Plan and Trust as set forth in Exhibit "C". Section 4. That the City hereby agrees to continue to serve as trustee under the Phn and to invest funds held under the Plan in the ICMA Retirement Trust. Section 5. That the City Manager shall continue to cast, on behalf of the Employer, any required votes under the ICMA Retirement Trust, execute all necessary agreements with the ICMA Retirement Corporation incidental to the administration of the Plan, may receive all reports and notices from the ICMA Retirement Corporation, and may delegate any administrative duties. PASSED AND ADOPTED in ~egmlar session on this the 25~h day of July, 2000. MAYOR ATTEST: City Clerk - 2 - Res. No. 51-00 EXHIBIT A ICMA 3% MANAGEMENT MATCH PROGRAM SCHEDULE OF ELIGIBLE MANAGEMENT AND KEY EMPLOYEE POSITIONS _ (April 1999) ADMINISTRATIVE SERVICES Assistant City Manager Deputy Director of Public Works Building Maintenance Supe. rintendent Streets Superintendent CITY ATTORNEY'S OFFICE City Attorney City Attorney 11 City Attorney i CITY CLERK'S OFFICE City Clerk Deputy City Clerk CITY MANAGER'S OFFICE City Manager COMMUNITY IMPROVEMENT Director of Community Improvement Building and Inspection Administrator Code Administrator Community Development Coordinator Deputy Building Official Horticulturist ENVIRONMENTAL SERVICES Director of Environmental Services City Engineer Deputy Director of Public Utilities Deputy DirectS'r of Construction Water/Sewer Network Superintendent Water Treatment Plant Superintendent Maintenance Superintendent Environmental Compliance Manager Assistant Construction Manager Assistant City Engineer FINANCE Director of Finance Assistant Finance Director MIS Manager Risk Manager Utilities Customer Service Manager Treasurer Budget Administrator Administrative Manager Purchasing Supervisor Technical Services Administrator Senior Programmer/Analyst Network Engineer FIRE Fire Chief Assistant Fire Chief Division Chief/Professional Training Divison Chief/EMS Division Chief/Fire Safety Battalion Chief Administrative Officer HUMAN RESOURCES Director of Human Resources Human Resources Administrator Training and Development Manager PARKS AND RECREATION Director of Parks and Recreation Assistant Parks and Recreation Director Recreation Superintendent Parks Superintendent Beach Supervisor PLANNING AND ZONING Director of Planning and Zoning Principal Planner POLICE Police Chief Police Major Police Captain Police Lieutenant Administrative Services Director Assistant City Attorney/Police Legal Assistant Director Support Services Communications Manager EXHIBIT B Ao , oM' EN DM ENT ~ OVERNMENTAL M¢)I~Y PURCHASE P£..a2q & TRUST pd3OPTION AGRI::.~MENT The Employer hen:by establishes a Money Purchase Plan and Trust Io be kno~m as CITY OF D~,RAY BEACH This Plan is an ammdment and restatement of an existing defined contribution money purchase plan x Yes No If yes, pleue spec fy ~he .a.-ne of the defined conm'bufion money purt:] m.-,e plan which ~his Plan h-reby amends an, I restates: CITY OF DELRAY BEACH 40lA PLAN ~nployer: _ CITY OF, DELRAY BEACH II The Ef~ecdve Daze of the Plan si'mil be the first day. of the Plan Year during which tbe Emplo.-,er adopts the Plan. unless an ahcmate Effective Daw is hereby sl~ificd: 10/01/1996 IlL Plan Ye ar will mean: ; ) The ~welvc (l 2) consecutive month period which coincides limitation ,/ear. (See Seclion f04(i) of the Plan.) IV. The r~ive (12) consecutive month period commencing on ., 10/01 and esch ~miver.~.ry thereof. Normal R.cxirm-nent Age shall be age , ~5 , (not to exceed age ELIGIBILITY R.F.. Q UIREMENTS: The folla~ing group or groups of Employees are eligible to parficipam in thc Plan Ail Employees VI. . All Full-Timc Employees · , Salaried Employees · Non-union Employees ,,,~ Mana&emem Employees Public S~f'et'y Employees , , General Employees x Othtr (speci~ below) Eligible management employees as designated :Ln ]~esolut16n I?-91, as amen~eo oy' Kesolution 51-00 _~n_d as such ,may be ameq~d from ~ime tO time.. : T~c g~oup specified mu.~ corresponc: to a group o~ me ~a, rne aeslgnatmn tidal ~s defined in the statutes, ord. bl~ces, rules, tegl.datio~, l~soi~el l~u~s oT other mater~a~ in effect in the sta~ or loc~lit~ of L1~e Employer, The Employer hereby v,~ves ar reduces the requL"ement ora twelve (12) mon~ Peg~ or Se~ce [or ~ci~gon. ~c ~qui~d P~ of S~ s~l be N/~ (~m N/A if an ~ploy~ is elig{ble ~ p~ci~ ~n ~plo~em). If this wmver or reduction is clocked, it shall apply to all Employees within thc Covered Employment Classification. 3 A minimum age requirement is h~eby specified for eligibility m pm'ti¢i~te. The minimum age requirement is. ~/A _{not to exceed age 21. Write NIA if no m.ir~mum age is dccla,-ed.) CON' FRIBUTION PROVISIONS Thc Employer shall con~but~ as follows (choose one): Fixed Employer Contributions With Or Without Mandatory Participant Contributions. The Employer shall contribute on bcl~lf efcach Participm,.t 3.00 % ofF. amings or $ ~ for d~e Plan Year (sul~cct to xhe limitations of Article V of~c Plan). Each P'gticip~tt is rcqmred to contribute ,3.0 % of£amings or S for ~hc Plan Year as a condkion of partlcipa~ion in Ibc Plan. (V/rim '0" ifno contribution is required.) IfParticipant Contributions are required under this option, a Panieila~tt shall not have thc ri&hr to discontinue or vary thc rate ofsur, b cort~bminns after becoming · Plan Participant. Thc Employer hereby elects to 'pick Mandatory/Required Participant Con~ibutian. () () MPP .~,doptiort Agre,-ment x Yes No [Note to Employer: A determination letter issued to an adoptin~ Employer is not ,, mlin_e By the Internal Revenue S~rvice r. im£ Panic[pant con~butions tlm~ ar~ picked up by thc Employer ~re not includable in the Participant's gross income for federal income tax purposes. The Employer may seek such a talin:. P~ckcd up contributions are excludable from r. he ParticiI~fS gross income under section 414{h)(2) of thc Internal Revenue Code of 19X6 only if they m~t the rcq~ts of Rev. Rul. 81-35, 19gl-! C.B. 255. Tl~se t~quirements are (1} ti'mt the Employer mu.st ~-pecif¥ that the contribuzinns, al~ough des- ignated as employee corm-ibutions, ar~ being paid by the Employer in lieu ofcontribm:ions by the employee; and (2) ~ employee must not have thc option o£r~cciving l:he contributmt amounts directly instead ofhavin2 them paid by the F. mplaycr to thc plan.] Fixed Employer Match of Participant Contributions. Thc F. mployer shall contribtne on behalf of each Pm'ti~t % of l:-mings for the Plan Year (subject ~o the lhriilaTions of Article V ofd,.c Plan) for each Plan Year ths~ such Participant has contributcd % of Earnings or $ Under thas option, there is a single, fixed ~ate of Employcr contributions, but a Participant may decline to make th~ required Participant contributions in any Plan Year, in which case no Employer contribution will hc made on the Participant's l~:half in that Plan Year. Variable Employer Match Of Participant Contributions. Thc Employer shall conu'ibute on behalf of each Participant an amount determined a~ follows (subject zo ~ limitations of Article V of the Plan): ,, % ofthe conlrib~iorts made by the Participant for t~ Plan Year (hoc including Participant conuibutions ~nl~ % of' Earnings or $ . ); PLUS ~ of thc contributions made by the Panicipan~ for the Plan Year in excess ofthose included in thc above parn~-aph (but not includina Panlcipant contributions excccdLr~ in aggregate % of Earnings or $ }. 2 ~nploy~ Contributions on behalf ora Paz~cipent ~'or- PLan Year shall not exceed $ or % ot'~'nings, - wh,ichcvcr is ---- more or.. less. Each Pe:uc~pant may make a voluntaz7 (unn~ched], a.fier-~ conm'bmion, s~bj¢ct to thc limitations of Section 4.05 Mci A~clc V of the Plan. x Yes ~mploycr con~buuons and Pa~icipan! con~ibutions shall be contribur~f to thc 'Tru:,'c in accordance with the t'ollow~g payment schedule: BI -WEEKLY EA.I~4INGS Earni ~gs, a~ d,'fined under Section 2.09 of'the Plan, shall include: (a) Overtime Yes x No VIII. LIIvS'{'ATI()N ON ALLOCATIONS If the Employer m~intains or ever reaL. rained another quaiLfied plan in which any Par~ic/pan: in thts Plan is (or was) a panic/pant or could possibly become a pro, c/pant, Employer hereby ag~-'~s m 1Lmit contributions m a31 such plans ~s providc~ herein, ifnec~:ssary in order m avoid excess con~budons Cas ~cscn'bed in Sections 5.02 and 03 c fthe Plan). ltr~hc Participant is covered under another qualificd d~med contribution plan m~intaincd b~ th~ Employer, the provisions of Section 5.02(a) th~u~,h (~ of thc Plan will apply unless anather method has bccn indicated below. () Od~cr Method. CPtovide the method under which thc pt~ns will limit tot. al Annual Additions m ta~u: ~ximum Permissible Ammmt. and will properly reduce any excess amotmts, in a mariner tha~ l:n~cludr..s ]~'nployer discretion.) 2 If the Paz'zic~pa. nt is ar has ever beea a paz~cipaat in = de~d ~t p]~ wo d exceed, P ci t's Benefit ~d~ ~ defined ~cfit pl~ ~I ~ ~d~cd ~ ~cor~cc ~ ~ ~ ~fm the e~nt ncc~ m ~tis~ ~h !~~ Ifs~h pl~ d~ ~t pm~dc for ~ch ~d~tion. or if~c lift.on ~ ~11 ~ecdcd ~ ~e ~ductio~ :~ additio~ ~1 be ~uced to ~e ~t ~ce~ ~ ~c ~--v~ desc~bed ~ Sectio~ 5.02 ~d ~.0~. ~ ~o~ o~voi~ ~ ~gon d~scghed ~ ~s ~ph ~11 not appl~ if~e Employer ~i~ ~o~ me.od bclo~. Och,'r Method. (Note to Employer: !Provid~ below which vill sacisf, y the 1.0 limi~tion of s~xion 415(e) or,he Cod~- Such lan~eua§e must preclude Employ~ discretion. section 1.415- I oflh~ Regulations fc ,r ~aidancc,) 3. ]'he lsmz~affon y~ar is ~he following 12..con.v'.cutiv¢ monfl~ p~iod: VES"rNG PROVISIONS Thc } mployer he.by ~ec~es ~c followinE mimr~um vesting requi~mcnts ~ noted ~d (2) ~he concm~nce of the P[~ Adm~ nistza~oz. Years of Service Co_mpleted Zero '! hree Four Five Six Seven Esght Nine Ten MPP Adoption AS~re~ment P~l'c, ent VestinF 0.00 % ~00.00% f00.00% 100.00'/= 10 o-6"6'Tb'o-, o /, 100.00% l.oans -,'~ permimed under '.he Plan. as provi~,-d in Article XlII: x No Thc Em.mloycr hereby ancsts that it is a unit of state or local government or an agency or instrc, mentali~ of one or more units of state or loc. al govcrllmtmL The P~t. Adminis~alor hereby alP-ecs to inform the Employer of any amendments to the Plan made pursuant to Secticm 14.05 of thc Plan or of the discorninuan~ or abandonment of the Plan. The £m~loyer hereby appoints thc ICMA Reti~mer~t Corporation as thc Plan Admini.*.trator parsuant zo thc ~crms and conditions of the ICMA RE~ CORP0 RATION GOVERNMENTAL MONEY PURCHASE PLAN & TRUST. Thc Errt.~loycr hereby agrees to the provisions of the Plan and Trust. Thc Em,~loyer hereby acknowledges it understands that failure to prapcrly fill oul this Adoption Agreemcnt may rcsul! in dL~iualificafion of thc Plan. An adot ting Employe, may not r~ly on a dctcrmiru~ion lev. ct ismcd by the National or Distric~ Office of thc Internal Revenue Service as evidence thax the Plan is qualified under sec~iofa 401 oflhc In~emal Revenue Code. In order ~o obtain reliance with spcct zo plan qualification. ~he Employer must apply to the ~prc~datc key district office fcr a dct~-mtnation lener. In Wimess Whcr~t,f. thc Employer hereby ca,es this Agreement to be executcd on this ... day of , 19__. EMPLOYER Accepted: ICMA RETIR,E~ CORPORATION By: By: Title: Title: MPP Adopcior~ Agreement 03/2S,'9l EXHIBIT C GOVERNMENTAL MONEY PURCHASE PLAN & TR U ST EMPLOYER PLAN RETAIN BOOKLET ICMA RETIREMENT CORPORATION The public service Vantagepoint® since 1972 USING THIS DOCUMENT Governmental Money Purchase Plan & Trust Basic Document Internal Revenue Service Determination Letter and Publication 794 and Declaration of Trust of the ICMA Retirement Trust This is one of two booklets containing information relating to your Governmental Money Purchase Plan & Trust with the ICMA Retirement Corporation. Please read the information and retain it for your files. If you have any questions concerning information in this booklet, contact Customer Services toll-free at 1-800-326-7272. ICMA R. ETII~EMENT COR. POI~ATION GOVERNMENTAL MONEY PURCHASE PLAN & TRUST BASIC DOCUMENT Table of Contents III. PURPOSE ...................................................... I DEFINITIONS ................................................... I 2.01. Account 1 2.02 Accounting Date 1 2.03 Adoption Agreement 1 2.04 Beneficiary 1 2.05 Break in Service 1 2.06 Code 1 2.07 Covered Employment Classification 2 2.08 Disability 2 2.09 Earnings 2 2.10 Effective Date 3 2.11 Employee 3 2.12 Employer 3 2.13 Hour of Service 3 2.14 Nonforfeitable Interest 3 2.15 Normal l~etirement Age 3 2.16 Participant 3 2.17 Period of Service 4 2.18 Period of Severance 4 2.19 Plan 4 2.20 Plan Administrator 4 2.21 PlanYear 4 2.22 Trust 4 ELIGIBILITY .................................................... 4 3.01 Service 4 3.02 Age 4 3.03 Return to Covered Employment Classification 5 3.04 Service Before a Break in Service 5 blPP 04/30/2000 ~ V. CONTRIBUTIONS ............................................... 5 VI. VII. VIII. 4.01 Employer Contributions 5 4.02 Forfeitures 5 4.03 Mandatory Participant Contributions 5 4.04 Matched Participant Contributions 5 4.05 Voluntary Participant Contributions 6 4.06 Deductible Employee Contributions 6 4.07 Military Service Contributions 6 4.08 Changes in Participant Election 6 4.09 Portability of Benefits 6 4.10 Return of Employer Contributions 7 LIMITATIONS ON ALLOCATIONS ................................ 7 5.01 Participants Only inThis Plan 7 5.02 Participants in Another Defined Contribution Plan 8 5.03 Participants in a Defined Benefit Plan 10 5.04 Definitions 10 TRUST AND INVESTMENT ACCOUNTS .............................. 13 6.01 Trust 13 6.02 Investment Powers 13 6.03 Taxes and Expenses 15 6.04 Payment of Benefits 15 6.05 Investment Funds 15 6.06 Valuation of Accounts 16 6.07 Participant Loan Accounts 16 VESTING ...................................................... 16 7.01 Vesting Schedule 16 7.02 Crediting Periods of Service 16 7.03 Service After Break in Service 16 7.04 Vesting Upon Normal P~etirement Age 17 7.05 Vesting Upon Death or Disability 17 7.06 Forfeitures 17 7.07 R. einstatement of Forfeitures 17 BENEFITS CLAIM ................................................ 18 8.01 Claim of Benefits 18 8.02 Appeal Procedure 18 MPP 0413~/2(100 ~ IX. Xe XI. XII. Xlll. COMMENCEMENT OF BENEFITS ................................... 18 9.01 Normal and Elective Commencement of Benefits 18 9.02 Restrictions on Immediate Distributions 18 9.03 Transfer to Another Plan 19 9.04 De Minimis Accounts 20 9.05 Withdrawal of Voluntary Contributions 21 9.06. Withdrawal of Deductible Employee Contributions 21 9.07 Latest Commencement of Benefits 21 DISTRIBUTION REQUIREMENTS ................................... 21 10.01 General Rules 21 10.02 Required Beginning Date 21 10.03 Limits on Distribution Periods 21 10.04 Determination of Amount to be Distributed EachYear 22 10.05 Death Distribution Provisions 22 10.06 Definitions 24 MODES OF DISTRIBUTION OF BENEFITS ............................ 25 11.01 Normal Mode of Distribution 25 11.02 Elective Mode of Distribution 25 11.03 Election of Mode 25 11.04 Death Benefits 25 SPOUSAL BENEFIT REQUIREMENTS ................................ 26 12.01 Application 26 12.02 Qualified Joint and Survivor Annuity 26 12.03 Qualified Preretirement Survivor Annuity 26 12.04 Notice Requirements 26 12.05 Definitions 28 12.06 Annuity Contracts 29 LOANS TO PARTICIPANTS ........................................ 29 13.01 Availability of Loans to Participants 29 13.02 Terms and Conditions of Loans to Participants 30 13.03 Participant Loan Accounts 32 MPP 04/30120~0 fin XIV. PLAN AMENDMENT, TERMINATION AND OPTIONAL PROVISIONS ....... 33 14.01 Amendment by Employer 33 14.02 Amendment of Vesting Schedule 33 14.03 Termination by Employer 33 14.04 Discontinuance of Contributions 34 14.05 Amendment by Plan Administrator 34 14.06 Optional Prov/sions 34 XV. ADMINISTRATION .............................................. 34 XVI. 15.01 Powers of the Employer 34 15.02 Duties of the Plan Administrator 35 15.03 Protection of the Employer 35 15.04 Protection of the Plan Administrator 35 15.05 Resignation or Removal of Plan Administrator 36 15.06 No Termination Penalty 36 15.07 Decisions of Plan Administrator 36 MISCELLANEOUS ............................................... 36 16.01 Nonguarantee of Employment 36 16.02 Bdghts to Trust Assets 36 16.03 Nonalienation of Benefits 36 16.04 Qualified Domestic P,:elations Order 36 16.05 Nonforfeitability of Benefits 37 16.06 Incompetency of Payee 37 16.07 Inability to Locate Payee 37 16.08 Mergers, Consolidations, and Transfer of Assets 37 16.09 Employer l~ecords 38 16.10 Gender and Number 38 16.11 Applicable Law 38 MPP 04/30/~xx) iv ICMA RETIREMENT CORPORATION GOVERNMENTAL MONEY PURCHASE PLAN & TRUST BASIC DOCUMENT I. PUKPOSE The Employer hereby adopts this Plan and Trust to pm,ride funds for its Employees' retirenaent, and to provide funds for their Beneficiaries in the event of death. The benefits provided in this Plan shall:be paid from the Trust. The Plan and the Trust forming a part hereof are adopted and shall be maintained for the exclusive benefit of eligible Employees and their Beneficiaries. Except as provided in Sections 4.10 and 14.03, no part of the corpus or income of the Trust shall revert to the Employer or be used for or diverted to purposes other than the exclusive benefit of Partici- pants and their Beneficiaries. II. DEFINITIONS 2.01 Account. A separate record which shall be estabhshed and maintained under the Trust for each Participant, and which shall include all Participant subaccounts created pursuant to Article IV, plus any Participant Loan Account created pursuant to Section 13.03. Each subaccount created pursuant to Article IV shall include any earnings of the Trust and adjust- ments for withdrawals, and realized and unrealized gains and losses allocable thereto. The term "Account" may also refer to any of such separate subaccounts. 2.02 Accounting Date. Each day that the NewYork Stock Exchange is open for trading, and such other dates as may be determined by the Plan Administrator, as provided in Section 6.06 for valuing the Trust's assets. 2.03 Adoption Agreement. The separate agreement executed by the Employer through which the Employer adopts the Plan and elects among the various alternatives provided thereunder, and which upon execution, becomes an integral part of the Plan. 2.04 Beneficiary. The person or persons designated by the Participant who, subject to the re- quirements of Article XII, shall receive any benefits payable hereunder in the event of the Participant's death. The designation of such Beneficiary shall be in writing to the Plan Administrator. A Participant may designate primary and contingent Beneficiaries. Where no designated Beneficiary survives the Participant, the Participant's Beneficiary shall be his/ her surviving spouse or, if none, his/her estate. 2.05 Break in Service. A Period of Severance of at least twelve (12) consecutive months. In the case of an individual who is absent from work for maternity or paternity reasons, the twelve (12) consecutive month period beginning on the first anniversary of the first date of such absence shall not constitute a Break in Service. For purposes of this paragraph, an absence from work for maternity or paternity reasons means an absence (1) by reason of the pregnancy of the individual, (2) by reason of the birth of a child of the individual, (3) by reason of the placement of a child with the individual in connection with the adoption of such child by such individual, or (4) for purposes of caring for such child for a period beginning immediately following such birth or placement. MPP (M/.MII2¢~gI I 2.06 Code. The Internal Revenue Code of 1986, as amended from time to time. 2.07 Covered Employment Classification. The group or groups of Employees eligible to make and/or have contributions to this Plan made on their behalf, as specified by the Employer in the Adoption Agreement. 2.08 Disability. A physical or mental impairment which is of such permanence and degree that, as determined by the Employer, a Participant is unable because of such impairment to perform any substantial gainful activity for which he/she is suited by virtue of his/her experience, training, or education and that has lasted, or can be expected to last, for a con- tinuous period of not less than twelve (12) months, or can be expected to result in death. The permanence and degree of such impairment shall be supported by medical evidence. If the Employer maintains a long-term disability plan, the definition of Disability shall be the same as the definition of disability in the long-term disability plan. 2.09 Earnings. (a) General Rule. Earnings, which form the basis for computing Employer Contribu- tions, are all of each Participant's W-2 earnings which are actually paid to the Partici- pant during the PlanYear, plus any contributions made pursuant to a salary reduction agreement which are not includible in the gross income of the Employee under section 125,402(e)(3), 402(h)(1)(B), 403(b), 4140a)(2), or 4570a) of the Code. Unless the Employer elects otherwise in the Adoption Agreement, Earnings shall exclude overtime compensation and bonuses. Limitation on Earnings. Notwithstanding the foregoing, effective as of the first Plan Year beginning on or after January 1, 1989, and before January 1, 1994, the annual Earnings of each Participant taken into account for determining all benefits provided under the Plan for any PlanYear shall not exceed $200,000.This limitation shall be adjusted by the Secretary of the Treasury at the same time and in the same manner as under section 415 (d) of the Code, except that the dollar increase in effect on January 1 of any calendar year is effective for years beginning in such calendar year and the first adjustment to the $200,000 limitation is effective on January 1,1990. For PlanYears beginning on or after January 1,1994, the annual Earnings ot each Participant taken into account for determining all benefits provided under the Plan for any PlanYear shall not exceed $150,000, as adjusted for increases in the cost-of- living in accordance with section 401 (a)(17)(t3) of the Code. The cost-of-living adjustment in effect for a calendar year applies to any determination period begin- ning in such calendar year. If a determination period consists of fewer than twelve (12) months, the annual Earnings limit is an amount equal to the otherwise applicable annual Earnings limit multiplied by a fraction, the numerator of which is the number of months in the short determination period, and the denominator of which is twelve (12). MPP tM/30/21,~) 2 2.10 2.11 2.12 2.13 2.14 2.15 2.16 MPP If Earnings for any prior determination period are taken into account in determin- ing a Participant's allocations for the current PlanYear, the Earnings for such prior determination period are subject to the applicable annual Earnings hmit in effect for that prior year. For this purpose, for years beginning on or after January 1, 1989, the applicable annual Earnings limit is $200,000. In addition, in determining allocations in PlanYears beginning on or after January 1, 1994, the annual Earnings limit in effect for determination periods beginning before that date is $150,000. (c) Limitations for Governmental Plans. In the case of an eligible participant in a governmental plan (within the meaning of section 414(d) of the Code), the dollar limitation shall not apply to the extent the Earnings which are allowed to be taken into account under the Plan would be reduced below the amount which was al- lowed to be taken into account under the Plan as in effect on July 1, 1993. For purposes of this Section, an eligible participant is an individual who first became a Participant in the Plan during a PlanYear beginning before the first PlanYear begin- ning after December 31, 1993. Effective Date. The first day of the PlanYear during which the Employer adopts the Plan, unless the Employer elects in the Adoption Agreement an alternate date as the Effective Date of the Plan. Employee. Any individual who has applied for and been hired in an employment position and who is employed by the Employer as a common law employee; provided, however, that Employee shall not include any individual who is not so recorded on the payroll records of the Employer, including any such person who is subsequently reclassified by a court of law or regulatory body as a common law employee of the Employer. For purposes of clarifica- tion only and not to imply that the preceding sentence would otherwise cover such person, the term Employee does not include any individual who performs services for the Employer as an independent contractor, or under any other non-employee classification. Employer. The unit of state or local government or an agency or instrumentality of one (1) or more states or local governments that executes the Adoption Agreement. Hour of Service. Each hour for which an Employee is paid or entitled to payment for the performance of duties for the Employer. Nonforfeitable Interest. The interest of the Participant or his/her Beneficiary (whichever is applicable) in that percentage of~his/her Employer Contribution Account balance which has vested pursuant to ArticleVII. A Participant shall, at all times, have a one hundred percent (100%) Nonforfeitable Interest in his/her Participant Contribution, Portable Benefits, and Voluntary Contribution Accounts. Normal Retirement Age. The age which the Employer specifies in the Adoption Agree- ment. If the Employer enforces a mandatory retirement age, the Normal P~etirement Age is the lesser of that mandatory age or the age specified in the Adoption Agreement. Participant. An Employee or former Employee for whom contributions have been made under the Plan and who has not yet received all of the payments of benefits to which he/she 111. is entitled under the Plan. A Participant is treated as benefiting under the Plan for any Plan Year during which the Participant received or is deemed to receive an allocation in accor- dance with Treas. Reg. section 1.410(b)-(3) (a). 2.17 Period of Service. For purposes of determining an Employee's initial or continued eligibility to participate in the Plan or the Nonforfeitable Interest in the Participant's Account balance derived from Employer Contributions, an Employee will receive credit for the aggregate of all time period(s) commencing with the Employee's first day of employment or reemploy- ment and:ending on the date a Break in Service begins. The first day of employment or reemployment is the first day the Employee performs an Hour of Service. An Employee x~Sll also receive credit for any Period of Severance of less than twelve (12) consecutive months. Fractional periods of a year will be expressed in terms of days. Notwithstanding anything to the contrary herein, ff the Plan is an amendment and restate- ment ora plan that previously calculated service under the hours of service method, service shall be credited in a manner that is at least as generous as that provided under Treas. Regs. section 1.410(a)-7(g). 2.18 Period of Severance. A continuous period of time during which the Employee is not employed by the Employer. Such period begins on the date the Employee retires, quits or is discharged, or ifearher, the twelve (12) month anniversary of the date on which the Em- ployee was otherwise first absent from service. 2.19 Plan. This Plan, as established by the Employer, including any elected provisions pursuant to the Adoption Agreement. 2.20 Plan Administrator. The ICMA Retirement Corporation or any successor Plan Administra- tor. 2.21 PlanYear. The twelve (12) consecutive month period designated by the Employer in the Adoption Agreement. Trust. The Trust created under ArticleVI of the Plan which shall consist of all of the assets of the Plan derived from Employer and Participant contributions under the Phn, plus any income and gains thereon, less any losses, expenses and distributions to Participants and Beneficiaries. -ZLIGIBILITY Service. Except as provided in Sections 3.02 and 3.03 of the Plan, an Employee within the Covered Employment Classification who has completed a twelve (12) month Period of Service shall be eligible to participate in the Plan at the beginning of the payroll period next conunencing thereafter. The Employer may elect in the Adoption Agreement to waive or reduce the twelve (12) month Period of Service. If the Employer maintains the plan of a predecessor employer, service with such employer shall be treated a Service for the Employer. MPt- - '_' ,. 4 IV. 3.02 Age. The Employer may designate a minimum age requirement, not to exceed age twenty-one (21), for participation. Such age, if any, shall be declared in the Adoption Agree- ment. 3.03 Return to Covered Employrnent Classification. In the event a Participant is no longer a member of Covered Employment Classification and becomes ineligible to make contribu- tions and/or have contributions made on his/her behalf, such Employee will become eli- gible:for contributions immediately upon returning to a Covered Employment Classifica- tion. If such Participant incurs a Break in Service, eligibility will be determined under the Break in Service rules of the Plan. In the event an Employee who is not a member of a Covered Employment Classification becomes a member, such Employee will be eligible to participate immediately if such Employee has satisfied the minimum age and service requirements and would have other- wise previously become a Participant. 3.04 Service Before a Break in Service. All Periods of Service with the Employer are counted toward eligibility, including Periods of Service before a Break in Service. CONTR. IBUTIONS 4.01 Employer Contributions. For each PlanYear, the Employer will contribute to the Trust an amount as specified in the Adoption Agreement. The Employer's full contribution for any PlanYear shall be due and paid not later than thirty (30) working days after the close of the PlanYear. Each Participant will share in Employer Contributions for the period beginning on the date the Participant commences participation under the Plan and ending on the date on which such Employee severs employment with the Employer or is no longer a member of a Covered Employment Classification, and such contributions shall be accounted for separately in his/her Employer Contribution Account. Notwithstanding anything to the contrary herein, if so elected by the Employer in the Adoption Agreement, an Employee shall be required to make contributions as provided pursuant to Section 4.03 or 4.04 in order to be eligible for Employer Contributions to be made on his/her behalf to the Plan. 4.02 Forfeitures. All amounts forfeited by terminated Participants, pursuant to Section 7.06, shall be allocated to a suspense account and used to reduce dollar for dollar Employer Contribu- tions otherwise required under the Plan for the current PlanYear and succeeding PlanYears, if necessary. Forfeitures may first be used to pay the reasonable administrative expenses of the Plan, with any remainder being applied to reduce Employer Contributions. 4.03 Mandatory Participant Contributions. If the Employer so elects in the Adoption Agreement, each eligible Employee shall make contributions at a prescribed rate as a requirement for his/her participation in the Plan. Once such an eligible Employee becomes a Participant hereunder, he/she shall not thereafter have the right to discontinue or vary the rate of such Mandatory Participant Contributions. Such contributions shall be accounted for separately in the Participant Contribution Account. Such Account shall be at all times nonforfeitable by the Participant. MPP 11,II~I/2111H! S 4.04 Matched Participant Contributions. If the Employer so elects in the Adoption Agreement, Employer Contributions shall be made on behalf of an eligible Employee for a Plan Year only if the Employee agrees to make Matched Participant Contributions for that Plan Year. The rate of Employer Contributions shall, to the extent specified in the Adoption Agree- ment, be based upon the rate at which Matched Participant Contributions are made for that PlanYear. Matched Participant Contributions shall be accounted for separately in the Participant Contribution Account. Such Account shall be at all times nonforfeitable by the Participant. 4.05 Voluntar~ Participant Contributions. If the Employer so elects in the Adoption Agreement, an eligible Employee may make voluntary (unmatched) contributions under the Plan for any PlanYear in any amount up to ten percent (10%) of his/her Earnings for such PlanYear. Such contributions shall be accounted for separately in the Participant'sVoluntary Contribu- tion Account. Such Account shall be at all times nonforfeitable by the Participant. 4.06 Deductible Employee Contributions. The Plan will not accept deductible employee contri- butions which are made for a taxable year beginning after December 1986. Contributions made prior to that date will be maintained in a Deductible Employee Contribution Ac- count. The Account will share in the gains and losses under the Plan in the same manner as described in Section 6.06 of the Plan. Such Account shall be at all times nonforfeitable by the Participant. 4.07 Military Service Contributions. Notwithstanding any provision of the Plan to the contrary, contributions, benefits and service credit with respect to qualified military service will be provided in accordance with section 414(u) of the Code. If the Employer has elected in the Adoption Agreement to make loans available to Partici- pants, loan repayments will be suspended under the Plan as permitted under section 414(u)(4) of the Code. 4.08 Changes in Participant Election. A Participant may elect to change his/her rate of Matched Participant Contributions orVoluntary Participant Contributions at anytime or during an election period as designated by the Employer. A Participant may discontinue such contri- butions at any time or during an election period as designated by the Employer. 4.09 Portability of Benefits. (a) An Employee within the Covered Employment Classification, whether or not he/ she has satisfied the minimum age and service requirements of Article III, may transfer or roll over his/her interest in a plan qualified under section 401(a) or 403(a) of the Code to this Plan, provided: (1) The distribution is on account of termination or discontinuance of the plan or the distribution becomes payable on account of the Employee's separation from service, death, disability or after the Employee attains age fifty-nine and one-half (59-1/2); and the form and nature of the distribution from the other plan satisfies the applicable requirements under the Code to make the transfer or rollover a nontaxable transaction to the Employee; MPP 04/~0/2000 (2) The amount distributed from the plan is transferred to this Plan no later than the sixtieth (60th) day after distribution was made from the plan; and (3) In the case ora rollover, the amount transferred to this Plan does not exceed the amount of the distribution reduced by the Employee contributions (if any) to the plan (other than accumulated deductible voluntary contribu- tions). Such transfer or mllover may also be through an Individual Retirement Plan quali- fied under section 408 of the Code where the Individual Retirement Plan was used as a conduit from the prior plan and the transfer is made in accordance with the rules provided at (1) through (3) of this paragraph and the transfer does not include any personal contributions or earnings thereon the Participant may have made to the Individual Retirement Plan. The amount transferred shall be deposited in the Trust and shall be credited to a Portable Benefits Account. Such Account shall be one hundred percent (100%) vested in the Employee. The Plan will accept accumulated Deductible Employee Contributions as defined in section 72(o)(5) of the Code that were distributed from a qualified retirement plan and transferred (rolled over) pursuant to section 402(a)(5), 402(a)(7), 403(a)(4), or 408(d) (3) of the Code. Notwithstanding the above, this transferred (rolled over) amount shall be deposited to the Trust and shall be credited to a Deductible Em- ployee Contribution Account. Such Account shall be one hundred percent (100%) vested in the Employee. (b) An Employee within the Covered Employment Classification, whether or not he/ she has satisfied the minimum age and service requirement of Article III, may, upon approval by the Employer and the Plan Administrator, transfer his/her interest in another plan maintained by the Employer that is qualified under section 401 (a) of the Code to this Plan, provided the transfer is effected through a one-time irrevo- cable written election made by the Participant. The amount transferred shall be deposited in the Trust and shall be credited to sources that maintain the same at- tributes as the plan from which they are transferred. Such transfer shall not reduce the accrued years or service credited to the Participant for purposes of vesting or eligibility for any Plan benefits or features. 4.10 Return of Employer Contributions. Any contribution made by the Employer because of a mistake of fact must be returned to the Employer within one year of the date ofcontribu- tiono V. LIMITATION ON ALLOCATIONS 5.01 Participants Only inThis Plan. (a) If the Participant does not participate in, and has never participated in another qualified plan or a welfare benefit fund, as defined in section 419(e) of the Code, MPP 0413012000 MPP 04/~)/2(X'X) (c) (d) maintained by the Employer, or an individual medical account, as defined by section 415(1) (2) of the Code, maintained by the Employer, which provides an Annual Addition, the amount of Annual Additions which may be credited to the Participant's Account for any LimitationYear will not exceed the lesser of the Maxi- mum Permissible Amount or any other limitation contained in this Plan. If the Employer Contribution that would otherwise be contributed or allocated to the Participant's Account would cause the Annual Additions for the LimitationYear to exceed the Maximum Permissible Amount, the amount contributed or allocated will be reduced so that the Annual Additions for the LimitationYear will equal the Ma~ximum Permissible Amount. Prior to determining the Participant's actual Compensation for the LimitationYear, the Employer may determine the Maximum Permissible Amount for a Participant on the basis of a reasonable estimation of the Participant's Compensation for the Limitation Year, uniformly determined for all Participants similarly situated. As soon as is adrninistrafively feasible after the end of the LimitadonYear, the Maxi- mum Permissible Amount for the LimitationYear will be determined on the basis of the Participant's actual Compensation for the LimitationYear. If, pursuant to Subsection (c) or as a result of the allocation of forfeitures, there is an Excess Amount, the excess will be disposed of as follows: AnyVoluntary Participant Contributions, to the extent they would reduce the Excess Amount, will be returned to the Participant; (2) If after the application of paragraph (1) an Excess Amount still exists, and the Participant is covered by the Plan at the end of the LimitationYear, the Excess Amount in the Participant's Account will be used to reduce Employer Contributions (including any allocation of forfeitures) for such Participant in the next LimitationYear, and each succeeding LimitafionYear if necessary; (3) If after the application of paragraph (1) an Excess Amount still exists, and the Participant is not covered by the Plan at the end of the LimitationYear, the Excess Amount will be held unallocated in a suspense account. The suspense account will be applied to reduce future Employer Contributions (including allocation of any forfeitures) for all remaining Participants in the next Limita- tionYear, and each succeeding LimitationYear if necessary; (4) If a suspense account is in existence at any time during a particular Limita- tion Year, all amounts in the suspense account must be allocated and reallo- cated to Participants' accounts before any Employer or any Employee contri- butions may be made to the Plan for that LimitationYear. Excess Amounts in a suspense account may not be distributed to Participants or former Partici- pants. 5.02 Participants in Another Defined Contribution Plan. (a) Unless the Employer provides other limitations in the Adoption Section applies if, in addition to this Plan, the Participant is cov~'-:d qualified deft'ned contribution plan maintained by the Employe."- or a fund, as defined in section 419(e) of the Code. maintained by u:e Emph~y,. individual medical account, as defined by section 4150)(2) of O..e Code, by the Employer, which provides an Annual Addition, during ara Lin fit;, The Annual Additions which may be credited to a Participant\ *.~'COtmt Plan for any such LimitafionYear will not exceed the Maximum ?'er,ui~Jl,l,: reduced by the Annual Additions credited to a Participant's Acc:.'x--nt m,d,j plans and welfare benefit funds for the same LimitafionYear. If=e with respect to the Participant under other defined contributic,: vlam .md benefit funds maintained by the Employer are less than the Ma.,.a::um Amount and the Employer contribution that would other, vise 5,: comrfl,,u,.,I allocated to the Participant's Account under this Plan would cau--,~ thc tions for the LimitafionYear to exceed this limitation, the amoutn: allocated will be reduced so that the Annual Additions under ail .-<ch Itl.",: for the LimitationYear will equal the Maxfmum Permissible A..-ncunt. Additions with respect to the Participant under such other der!ned plans and welfare benefit funds in the aggregate are equal to or __--eater th.m Maximum Permissible Amount, no amount will be contributed zr alh)~ Participant's Account under this Plan for the LimitafionYear. (b) Prior to determining the Participant's actual Compensation for 5e Limita~,,, 7, the Employer may determine the Maximum Permissible Amo,:rrr for a I'ar o,ap:,,~ m the manner described in Section 5.01 (c) As soon as is administratively feasible after the end of the Limi=:onYe:~r. mum Permissible Amount for the LimitafionYear vdll be deter-er/ned mi ,b,. the Participant's actual Compensation for the Limitation Year. If, pursuant to Subsection (c) or as a result of the allocation of:i:ffeiture~. Participant's Annual Additions under this Plan and such other Fi.ms would an Excess Amount for a LimitafionYear. the Excess Amount x~,2 be deem,.d consist of the Annual Additions last allocated, except that Annu.fi. Additiom tributable to a welfare benefit fund or individual medical accou~z xvill be d,.,..,, ,$ 'o have been allocated first regardless of the actual allocation date. (e) If an Excess Amount was allocated to a Participant on an allocat!en date ,,~ ,},j: I';,n which coincides with an allocation date of another plan. the Ex::~s Anm,m, ,~s~,b_ uted to this Plan will be the product of, (1) The total Excess Amount allocated as of such date, mulmziied by (2) The ratio of (i) the Annual Additions allocated to the Pz~-cipant LimitafionYear as of such date under this Plan to (ii) the 'total A'JImat hal~k. MPP 04/30/2000 5.03 5.04 MPP 04/30/2000 tions allocated to the Participant for the Limitation Year as of such date under this and all the other qualified defined contribution plans. (0 Any Excess Amount attributed to this Plan will be disposed in the manner described in Section 5.01(d). Participant in Defined Benefit Plan. If the Employer maintains, or at any time maintained, a qualified defined benefit plan covering any Participant in this Plan, the sum of the Partici- pant's Defined Benefit Fraction and Defined Contribution Fraction will not exceed 1.0 in any LimitationYear. The Annual Additions which may be credited to the Participant's Account'under this Plan for any LimitationYear will be limited in accordance with the Adoption Agreement. This Section will not apply in LimitationYears beginning after December 31, 1999. Definitions. For the purposes of this Article, the following definitions shall apply: (a) Annual Additions: The sum of the following amounts credited to a Participant's account for the LimitationYear: (1) Employer Contributions; (2) Forfeitures; (3) Employee contributions; and (4) Allocations under a simplified employee pension. Amounts allocated, after March 31, 1984, to an individual medical account, as de- fined in section 415(1)(2) of the Code, which is part of a pension or annuity plan maintained by the Employer, are treated as Annual Additions to a defined contribu- tion plan. For this purpose, any Excess Amount applied under Sections 5.01 (d) or 5.02(0 in the LimitationYear to reduce Employer Contributions will be considered Annual Addi- tions for such LimitationYear. Compensation: A Participant's wages, salaries, and fees for professional services and other amounts received (without regard to whether an amount is paid in cash) for personal services actually rendered in the course of employment with the Employer maintaining the Plan to the extent that the amounts are includible in gross income (including, but not limited to, bonuses, fringe benefits, and reimbursements or other expense allowances under a nonaccountable plan (as described in Treas. g. eg. section 1.62-2(c))), excluding the following: (1) Employer Contributions to a plan of deferred compensation which are not includible in the Employee's gross income for the taxable year in which contributed, or Employer Contributions under a simplified employee pen- sion plan to the extent such contributions are deductible by the Employee, or any distributions from a plan of deferred compensation; and (2) Other amounts which received special tax benefits, or contributions made by the Employer (whether or not under a salary reduction agreement) towards the purchase of an annuity contract described in section 403(b) of the Code (whether or not the amounts are actually excludable from the gross income of the Employee). (3) Notwithstanding the above, for LimitationYears beginning after December 31, 1997, Compensation shall include: (a) any elective deferrals (as defined in section 402(g)(3) of the Code), and any amount which is contributed or deferred by the Employer at the election of the Employee and which is not includible in the gross income of the Employee by reason of sections 125 or 457 of the Code. For purposes of applying the limitations of this Article, Compensation for a Limita- tionYear is the Compensation actually paid or made available during such year. (c) Defined Benefit Fraction: A fraction, the numerator ofwhich is the sum of the Participant's Projected Annual Benefits under all the defined benefit plans (whether or not terminated) maintained by the Employer, and the denominator of which is the lesser of 125 percent of the dollar limitation determined for the LimitationYear under sections 415(b) and (d) of the Code or 140 percent of the Highest Average Compensation, including any adjustments under section 415(b) of the Code. Notwithstanding the above, if the Participant was a participant as of the first day of the first LimitafionYear beginning after December 31, 1986, in one (1) or more defined benefit plans maintained by the Employer which were in existence on May 6, 1986, the denominator of this fraction will not be less than 125 percent of the sum of the annual benefits under such plans which the Participant had accrued as of the dose of the last LimitationYear beginning before January 1,1987, disregarding any changes in the terms and conditions of the plan after May 5, 1986. The preceding sentence applies only if the defined benefit phns individually and in the aggregate satisfied the requirements of section 415 of the Code for all LimitationYears begin- ning before January 1,1987. (d) Defined Contribution Dollar Limitation: $30,000 or, if greater, one-fourth (1/4) of the defined benefit dollar limitation set forth in section 415(b)(1) of the Code, as in effect for the LimitationYear. (e) Defined Contribution Fraction: A fraction, the numerator of which is the sum of the Annual Additions to the Participant's account under all the defined contribution MPP 04/~0/2000 11 (0 (g) (h) plans (whether or not terminated) maintained by the Employer for the current and all prior LimitationYears (including the Annual Additions attributable to the Participant's nondeductible Employee contributions to all defined benefit plans, whether or not terminated, maintained by the Employer, and the Annual Additions attributable to all welfare benefit funds, as defined in section 419(e) of the Code, and individual medical accounts as defined in section 4150)(2) of the Code, maintained by the Employer), and the denominator of which is the sum of the maximum aggre- gate amounts for the current and all prior LimitationYears of service with the Employer (regardless of whether a defined contribution plan was maintained by the Employer). The maximum aggregate amount in any LimitationYear is the lesser of 125 percent of the dollar limitation in effect under sections 415 (b) and (d) of the Code in effect under section 415(c)(1)(A) of the Code, or thirty-five percent (35%) of the Participant's Compensation for such year. If the Employee was a Participant as of the first day of the first LimitationYear beginning after December 31, 1986, in one (1) or more defined contribution plans maintained by the Employer which were in existence on May 6, 1986, the numera- tor of this fraction will be adjusted if the sum of this fraction and the Defined Ben- efit Fraction would otherwise exceed 1.0 under the terms of this Plan. Under the adjustment, an amount equal to the product of (1) the excess of the sum of the fi.actions over 1.0 multiplied by (2) the denominator of this fraction, will be perma- nendy subtracted fi.om the numerator of this fraction. The adjustment is calculated using the fi.actions as they would be computed as of the end of the last Limitation Year beginning before January 1,1987, and disregarding any changes in the terms and conditions of the plan made after May 5, 1986, but using the section 415 of the Code limitation applicable to the first LimitafionYear beginning on or after January 1, 1987. The Annual Addition for any LimitationYear beginning before January 1,1987, shall not be recomputed to treat all Employee contributions as Annual Additions. Employer: The Employer that adopts this Plan. Excess Amount: The excess of the Participant's Annual Additions for the Limitation Year over the Maximum Permissible Amount. An Excess Amount shall include allocable income. The income allocable to an Excess Amount is equal to the sum of the allocable gain or loss for the PlanYear and the allocable gain or loss for the period between the end of the PlanYear and the date of distributions (the gap period). The Plan may use any reasonable method for computing the income allocable to an Excess Amount, provided that the method is used consistently for all Participants and for all corrective distributions under the Plan for the PlanYear, and is used by the Plan for allocating income to Participants' Accounts. Highest Average Compensation: The average Compensation for the three (3) con- secutive years of service with the Employer that produce the highest average. A year MPP 0.,I/30/2000 12 of service with the Employer is the twelve (12) consecutive month period defined as the Limitation Year in the Adoption Agreement. (i) LimitafionYear: A calendar year, or the twelve (12) consecutive month period elected by the Employer in the Adoption Agreement. All qualified plans maintained by the Employer must use the same LimitationYear. If the LimitationYear is amended to a different twelve (12) consecutive month period, the new Limitation Year must begin on a date within the LimitationYear in which the amendment is made. 0) Maximum Permissible Amount: The maximum Annual Addition that may be con- tributed or allocated to a Participant's Account under the Plan for any Limitation Year shall not exceed the lesser of.' (1) The Defined Contribution Dollar Limitation, or (2) Twenty-five percent (25%) of the Participant's Compensation for the Limita- tionYear. If a short Limitation Year is created because of an amendment changing the Limita- tionYear to a different twelve (12) consecutive month period, the Maximum Permis- sible Amount will not exceed the Defined Contribution Dollar Limitation multi- plied by the following fi.action: Number of months in the short Limitation. Year 12 Projected Annual Benefit: The annual retirement benefit (adjusted to an actuarially equivalent straight hfe annuity if such benefit is expressed in a form other than a straight hfe annuity or qualified joint and survivor annuity) to which the Participant would be entitled under the terms of the plan assuming: (1) The Participant will continue employment until Normal Ketirement Age under the plan (or current age, if later), and (2) The Participant's Compensation for the current LimitationYear and all other relevant factors used to determine benefits under the plan will remain con- stant for all future LimitafionYears. VI. TRUST AND INVESTMENT OF ACCOUNTS 6.01 Trust. A Trust is hereby created to hold all of the assets of the Plan for the exclusive benefit of Participants and Beneficiaries, except that expenses and taxes may be paid from the Trust as provided in Section 6.03. The trustee shall be the Employer or such other person which agrees to act in that capacity hereunder. 6.02 Investment Powers. The trustee or the Plan Administrator, acting as agent for the trustee, shall have the powers listed in this Section with respect to investment of Trust assets, except MPP 04/30/200~ 13 to the extent that the investment of Trust assets is controlled by Participants, pursuant to Section 13.03. (a) To invest and reinvest the Trust without distinction between principal and income in common or preferred stocks, shares of regulated investment companies and other mutual funds, bonds, loans, notes, debentures, certificates of deposit, contracts with insurance companies including but not limited to insurance, individual or group annuity, deposit administration, guaranteed interest contracts, and deposits at reason- able rates of interest at banking institutions including but not limited to savings accounts and certificates of deposit. Assets of the Trust may be invested in securities that involve a higher degree of risk than investments that have demonstrated their investment performance over an extended period of time. To invest and reinvest all or any part of the assets of the Trust in any common, collective or commingled trust fund that is maintained by a bank or other institution and that is available to Employee plans qualified under section 401 of the Code, or any successor provisions thereto, and during the period of time that an investment through any such medium shall exist, to the extent of participation of the Plan, the declaration of trust of such common, collective, or commingled trust fund shall constitute a part of this Plan. (c) To invest and reinvest all or any part of the assets ofthe Trust in any group annuity, deposit administration or guaranteed interest contract issued by an insurance com- pany or other financial institution on a commingled or collective basis with the assets of any other plan or trust qualified under section 401(a) of the Code or any other plan described in section 401(a)(24) of the Code, and such contract may be held or issued in the name of the Plan Administrator, or such custodian as the Plan Adminis- trator may appoint, as agent and nominee for the Employer. During the period that an investment through any such contract shall exist, to the extent of participation of the Plan, the terms and conditions of such contract shall constitute a part of the Plan. To hold cash awaiting investment and to keep such portion of the Trust in cash or cash balances, without liability for interest, in such amounts as may from time to time be deemed to be reasonable and necessary to meet obligations under the Plan or otherwise to be in the best interests of the Plan. (e) To hold, to authorize the holding of, and to register any investment to the Trust in the name of the Plan, the Employer, or any nominee or agent of any of the forego- ing, including the Plan Administrator, or in bearer form, to deposit or arrange for the deposit of securities in a qualified central depository even though, when so depos- ited, such securities may be merged and held in bulk in the name of the nominee of such depository with other securities deposited therein by any other person, and to organize corporations or trusts under the laws of any jurisdiction for the purpose of acquiring or holding title to any property for the Trust, all 'with or without the addition of words or other action to indicate that property is held in a fiduciary or representative capacity but the books and records of the Plan shall at all times show that all such investments are part of the Trust. MPP 04/~0/2000 14 6.03 6.04 6.05 MPP 04130120O0 (0 Upon such terms as may be deemed advisable by the Employer or the Plan Adminis- trator, as the case may be, for the protection of the interests of the Plan or for the preservation of the value of an investment, to exercise and enforce by suit for legal or equitable remedies or by other action, or to waive any right or claim on behalf of the Plan or any default in any obligation owing to the Plan, to renew, extend the time for payment of, agree to a reduction in the rate of interest on, or agree to any other modification or change in the terms of any obligation owing to the Plan, to settle, compromise, adjust, or submit to arbitration any claim or right in favor of or against the Plan, to exercise and enforce any and all rights of foreclosure, bid for property in foreclosure, and take a deed in lieu of foreclosure with or without paying consid- eration therefor, to commence or defend suits or other legal proceedings whenever any interest of the Plan requires it, and to represent the Plan in all suits or legal proceedings in any court of law or equity or before any body or tribunal. (g) To employ suitable consultants, depositories, agents, and legal counsel on behalf of the Plan. To open and maintain any bank account or accounts in the name of the Plan, the Employer, or any nominee or agent of the foregoing, including the Plan Administra- tor, in any bank or banks. (i) To do any and all other acts that may be deemed necessary to carry out any of the powers set forth herein. Taxes and Expenses. All taxes of any and all kinds whatsoever that may be levied or assessed under existing or future laws upon, or in respect to the Trust, or the income thereof, and all commissions or acquisitions or dispositions of securities and similar expenses of investment and reinvestment of the Trust, shall be paid from the Trust. Such reasonable compensation of the Plan Administrator, as may be agreed upon from time to time by the Employer and the Plan Administrator, and reimbursement for reasonable expenses incurred by the Plan Admin- istrator in performance of its duties hereunder (including but not limited to fees for legal, accounting, investment and custodial services) shall also be paid from the Trust. However, no person who is a fiduciary within the meaning of section 3(21)(A) of EP,.ISA and regulations promulgated thereunder, and who receives full-time pay from the Employer may receive compensation from the Trust, except for expenses properly and actually incurred. Payment of Benefits. The payment of benefits from theTrust in accordance with the terms of the Plan may be made by the Plan Administrator, or by any custodian or other person so authorized by the Employer to make such disbursement. The Plan Administrator, custodian or other person shall not be liable with respect to any distribution of Trust assets made at the direction of the Employer. Investment Funds. In accordance with uniform and nondiscriminatory rules established by the Employer and the Plan Administrator, the Participant may direct his/her Accounts to be invested in one (1) or more investment funds available under the Plan; provided, however, that the Participant's investment directions shall not violate any investment restrictions established by the Employer and shall not include any investment in collecfibles, as defined in section 408(m) of the Code. lS 6.06 6.07 Valuation of Accounts. As of each Accounting Date, the Plan assets held in each investment fund offered shall be valued at fair market value and the investment income and gains or losses for each fund shall be determined. Such investment income and gains or losses shall be allocated proportionately among all Account balances on a fund-by-fund basis. The allocation shall be in the proportion that each such Account balance as of the immediately preceding Accounting Date bears to the total of all such Account balances as of that Ac- counting Date. For purposes of this Article, all Account balances include the Account balances of all Participants and Beneficiaries. -. Participant Loan Accounts. Participant Loan Accounts shall be invested in accordance with Section 13.03 of the Plan. Such Accounts shall not share in any investment income and gains or losses of the investment funds described in Section 6.05. VII. VESTING 7.01 Vesting Schedule. The portion of a Participant's Account attributable to Mandatory Partici- pant Contributions, Matched Participant Contributions, orVoluntary Participant Contribu- tions, and the earnings thereon, shall be at all times nonforfeitable by the Participant. A Participant shall have a Nonforfeitable Interest in the percentage of his/her Employer Con- tribution Account established under Section 4.01 determined pursuant to the schedule elected by the Employer in the Adoption Agreement. 7.02 Crediting Periods of Service. Except as provided in Section 7.03, all of an Employee's Periods of Service with the Employer are counted to determine the nonfoffeitable percent- age in the Employee's Account balance derived from Employer Contributions. If the Em- ployer maintains the plan of a predecessor employer, service with such employer will be treated as service for the Employer. For purposes of determining years of service and Breaks in Service for purposes of comput- ing a Participant's nonforfeitabfe right to the Account balance derived from Employer Contributions, the twelve (12) consecutive month period will commence on the date the Employee first performs an hour of service and each subsequent twelve (12) consecutive month period will commence on the anniversary of such date. 7.03 Service After Break in Service. In the case of a Participant who has a Break in Service of at least five (5) years, all Periods of Service after such Breaks in Service will be disregarded for the purpose of determining the nonforfeitable percentage of the Employer-derived Account balance that accrued before such Break, but both pre-Break and post-Break service will count for the purposes of vesting the Employer-derived Account balance that accrues after such Break. Both Accounts will share in the earnings and losses of the fund. In the case of a Participant who does not have a Break in Service of at least five (5) years, both the pre-Break and post-Break service will count in vesting both the pre-Break and post-Break Employer-derived Account balance. In the case of a Participant who does not have any nonforfeitable right to the Account balance derived from Employer Contributions, years of service before a period of consecu- five one (1) year Breaks in Service will not be taken into account in computing eligibility MPP 04/3o12000 16 service if the number of consecutive one (1) year Breaks in Service in such period equals or exceeds the greater of five (5) or the aggregate number of years of service. Such aggregate number of years of service will not include any years of service disregarded under the preceding sentence by reason of prior Breaks in Service. If a Participant's years of service are disregarded pursuant to the preceding paragraph, such Participant will be treated as a new Employee for eligibility purposes. Ifa Participant's years of service may not be disregarded pursuant to the preceding paragraph, such Participant shall continue to participate in the Plan, or, if terminated, shall participate immediately upon reemployment. 7.04 Vesting Upon Normal Retirement Age. Notwithstanding Section 7.01 of the Plan, a Par- ticipant shall have a Nonforfeitable Interest in his/her entire Employer Contribution Ac- count, to the extent that the balance of such Account has not previously been forfeited pursuant to Section 7.06 of the Plan, if he/she is employed on or after his/her Normal Retirement Age. 7.05 Vesting Upon Death or Disability. Notwithstanding Section 7.01 of the Plan, in the event of Disability or death, a Participant or his/her Beneficiary shall have a Nonforfeitable Inter- est in his/her entire Employer Contribution Account, to the extent that the balance of such Account has not previously been forfeited pursuant to Section 7.06 of the Plan. 7.06 Forfeitures. Except as provided in Sections 7.04 and 7.05 of the Plan or as otherwise pro- vided in this Section 7.06, a Participant who separates from service prior to obtaining full vesting shall forfeit that percentage of his/her Employer Contribution Account balance which has not vested as of the date such Participant incurs a Break in Service of five (5) consecutive years or, if earlier, the date such Participant receives, or is deemed under the provisions of Section 9.04 to have received, distribution of the entire Nonforfeitable Interest in his/her Employer Contribution Account. If a Participant receives a voluntary distribu- tion of less than the entire vested portion of his/her Employer Contribution Account, the part of the nonvested portion that will be treated as a forfeiture is the total nonvested por- tion multiplied by a fraction, the numerator of which is the amount of the distribution attributable to Employer Contributions and the denominator of which is the total value of the vested Employer Contribution Account. No forfeiture will occur solely as a result of a Participant's withdrawal of Employee Contri- butions. Forfeitures shall be allocated in the manner described in Section 4.02. 7.07 Reinstatement of Forfeitures. If the Participant returns to the employment of the Employer before incurring a Break in Service of five (5) consecutive years, any amounts forfeited pursuant to Section 7.06 shall be reinstated to the Participant's Employer Contribution Account on the date of repayment by the Participant of the amount distributed to such Participant from his/her Employer Contribution Account; provided, however, that if such Participant forfeited his/her Account balance by reason of a deemed distribution, pursuant to Section 9.04, such amounts shall be automatically restored upon the reemployment of MPP 0413012O00 17 such Participant. Such repayment must be made before the earlier of five (5) years after the first date on which the Participant is subsequently reemployed by the Employer, or the date the Participant incurs a Break in Service of five (5) consecutive years. VIII. BENEFITS CLAIM 8.01 Claim of Benefits. A Participant, Employee or Beneficiary shall notify the Plan Administra- tor in writing of a claim of benefits under the Plan. The Plan Administrator shall take such steps as may be necessary to facilitate the payment of such benefits to the Participant, Em- ployee or Beneficiary. 8.02 Appeal Procedure. If any claim for benefits is denied by the Plan Administrator, the Plan Administrator shall notify the claimant in writing of such denial, setting forth the specific reasons and citing reference to specific provisions of the Plan upon which the denial is based. An appeal period of sixty (60) days after receipt of the notification of denial shall be granted, and said notification shall advise the claimant of the appeal procedure. The claimant shall file the appeal with the Plan Administrator, whose decision shall be final, to the extent provided by Section 15.07. IX. COMMENCEMENT OF BENEFITS 9.01 Normal and Elective Commencement of Benefits. A Participant who retires, becomes Disabled or separates from service for any other reason may elect by written notice to the Plan Administrator to have the distribution of benefits commence on any date, provided that such distribution complies with Sections 9.02 and 9.07. Such election must be made in writing during the ninety (90) day period ending on the date as ofwhich benefit payments are to commence. A Participant's election shall be revocable and may be amended by the Participant. The failure of a Participant and the Participant's Spouse to consent to a distribution while a benefit is immediately distributable, within the meaning of section 9.02 of the Plan, shall be deemed to be an election to defer commencement of payment of any benefit. 9.02 R. estrictions on Immediate Distributions. Notwithstanding anything to the contrary in Section 9.01 of the Plan, if the value of a Participant's vested Account balance exceeds (or at any time of any prior distribution exceeded) the dollar limit under section 411(a)(11)(A) of the Code, and the Account balance is immediately distributable, the Participant and the Participant's Spouse (or where either has died, the survivor) must consent to any distribution of such Account balance. The consent of the Participant and the Participant's Spouse shall be obtained in writing during the ninety (90) day period ending on the date as of which benefit payments are to commence. The Plan Administrator shall notify the Participant and the Participant's Spouse of the right to defer any distribution until the Participant's Account balance is no longer immediately distributable. Such notification shall include a general description of the material features, and an explanation of the relative values of, the optional forms of benefit available under the Plan in a manner that would satisfy section 417(a)(3) of the Code, and shall be provided no less than thirty (30) and no more than ninety (90) days before the date as of which benefit MPP 041~072000 payments are to commence. However, distribution may commence less than thirty (30) days after the notice described in the preceding sentence is given, provided (i) the distribution is one to which sections 401 (a)(1 ]) and 417 of the Code do not apply or, if sections 401(a(11) and 417 of the Code do apply, the waiver requirements of Section 12.04(a) are met; (ii) the Plan Administrator clearly in[brms 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 (aqd, if applicable, a particular distribution option); and (iii) the Participant, after receiving the notice, affarmatively elects a distribution. Not~vithstanding the foregoi~lg, only the Participant need consent to the commencement of a distribution in the form of the Qualified Joint and Survivor Annuity while the Account balance is immediately distrihtRable. (Furthermore, if payment in the form of a Qualified Joint and Survivor Annuity is r~ot required with respect to the Participant pursuant to section 12.02 of the Plan, o,fly the Participant need consent to the distribution of an Ac- count balance that is immt'di.~.ely distributable.) Neither the consent of the Participant nor the Participant's Spouse shall be required for any form of distribution to the extent that a distribution is required to sathfy section 4010)(9) or 415 of the Code. In addition, upon terminatio~ ~ffthis Plan if the Plan does not offer an annuity option (purchased from a commercial provider) and if the Employer does not maintain another defined contribution plan, the Participant's Account balance will, without the Participant's consent, be distributed to the Participant. An Account balance is immediately distributable if any part of the Account balance could be distributed to the Participant (or Surviving Spouse) before the Participant attains or would have attained (if not deceased) the later of Normal l:~etirement Age or age sixty-two (62). For purposes of determining file applicability of the foregoing consent requirements to distributions made befi~re the first day of the first plan year beginning after December 31, 1988, the Participant's vested Account balance shall not include amounts attributable to accumulated deductible employee contributions within the meaning of section 72(o)(5)(]3) of the Code. 9.03 Transfer to Another Plan. (a) Ifa Participant become~ eligible to participate in another plan maintained by the Employer that i~ qualified under section 401(a) of the Code, the Plan Administrator shall, at the written ele,.tion of such Participant, transfer all or part of such Participant~ Account t~ ~uch plan, provided the plan administrator for such plan certifies to the Plan Administrator that its plan provides for the acceptance of such a transfer. For purposes ,8'this Plan, any such transfer shall not be considered a distri- bution to the Participator subject to spousal consent as described in Section 9.02 and Article (b) Notwithstanding any P~ovision of the Plan to the contrary that would otherwise limit a Distributee's ele~.tion under this Section, a Distributee may elect, at the time and in the manner pre~,.ribed by the Plan Administrator, to have any portion of an MPP 041~012000 19 9.04 lvlPp o4/~o/2oo0 Eligible Kollover Distribution paid directly to an Eligible Retirement Plan specified by the Distributee in a Direct P,.ollover. For purposes of this Plan, any such Eligible P,.ollover Distribution shall be considered a distribution to the Participant subject to spousal consent as described in Section 9.02 and Article XII. (c) Definitions. For the purposes of Subsection (b), the following definitions shall apply: (1) ; Eligible R. ollover Distribution. Any distribution of all or any portion of the balance to the credit of the Distributee, except that an Eligible R. ollover Distribution does not include: any distribution that is one ora series of substantially equal periodic payments (not less frequently than annually) made for the life or life expectancy of the Distributee or the joint lives or joint life expectancies of the Distributee and the Distributee's designated beneficiary, or for a specified period of ten years or more; any distribution to the extent such distribution is required under section 401(a)(9) of the Code; the portion of any distribution that is not includible in gross income; and any other distribution(s) that is reasonably expected to total less than $200 during a year. (2) Ehgible tketirement Plan. An individual retirement account described in section 408(a) of the Code, an individual retirement annuity described in section 408(b) of the Code, an annuity plan described in section 403(a) of the Code, or a qualified trust described in section 401(a) of the Code, that accepts the Distributee's Ehgible P, ollover Distribution. However, in the case of an Ehgible Kollover Distribution to the Surviving Spouse, an Ehgible Retirement Phn is an individual retirement account or individual retirement (3) Distributee. Participant; in addition, the Participant's surviving spouse and the Participant's spouse who is the alternate payee under a qualified domestic relations order, as defined in section 414(p) of the Code, are Distributees with regard to the interest ofthe spouse or former spouse. (4) Direct tKollover. A payment by the Plan to the Eligible Retirement Plan specified by the Distributee. De Minimis Accounts. Notwithstanding the foregoing provisions of this Article, ifa Partici- pant terminates service, and the value of his/her Nonfoffeitable Interest in his/her Account is not greater than the dollar limit under section 411(a) (l l) (A) of the Code, the Participant shall be paid his/her benefits as soon as practicable after such termination, but, in no event, later than the second PlanYear following the PlanYear in which the Participant terminated employment. For purposes of this Section, ifa Participant's Nonfoffeitable Interest in his/ her Account is zero, the Participant shall be deemed to have received a distribution of such Nonfoffeitable Interest in his/her Account. A Participant's Nonforfeitable Interest in his/her Account shall not include accumulated Deductible Employee Contributions within the meaning of Section 72(o)(5)03) of the Code for PlanYears beginning prior to January 1,1989. 9.05 Withdrawal of Voluntary Contributions. A Participant may make a written election, or if married, a Qualified Election, to withdraw a part of or the full amount of his/herVoluntary Contribution Account. Such withdrawals may be made at any time, provided that no more than two (2) such withdrawals may be made during any calendar year. No forfeiture will occur solely as the result of any such withdrawal. 9.06 Withdrawal of Deductible Employee Contributions. A Participant may make a written election, or if married, a Qualified Election, to withdraw a part of or the full amount of his/ htr Deductible Employee Contribution Account. Such withdrawals may be made at any time, provided that no more than two (2) such withdrawals may be made during any calen- dar year. No forfeiture will occur solely as the result of any such withdrawal. 9.07 Latest Commencement of Benefits. Notwithstanding anything to the contrary in this Article, benefits shall begin no later than the Participant's R. equired Beginning Date, as defined under Section 10.06, or as otherwise provided in Section 10.05. DISTR. IBUTION R-EQUII:LEMENTS 10.01 General P,.ules. (a) Subject to the provisions of Article XII, the requirements of this Article shall apply to any distribution of a Participant's interest and will take precedence over any inconsis- tent provisions of this Plan. (b) All distributions required under this Article shall be determined and made in accor- dance with the proposed regulations under section 401(a)(9) of the Code, including the minimum distribution incidental benefit requirement of section 1.401(a)(9)-2 of the proposed regulations. 10.02 Required Beginning Date. The entire Nonforfeitable Interest of a Participant must be distributed or begin to be distributed no later than the Participant's R. equired Beginning Date. 10.03 Limits on Distribution Periods. As of the first Distribution CalendarYear, distributions, if not made in a single-sum, may only be made over one of the following periods (or a combination thereof): (a) The life of the Participant, (b) The life of the Participant and a Designated Beneficiary, (c) A period certain not extending beyond the Life Expectancy of the Participant, or A period certain not extending beyond the Joint and Last Survivor Expectancy of the Participant and a Desil0~ated Beneficiary. MPP 04/~0/2000 21 10.04 10.05 MPP 04/.;3012000 Determination of Amount to Be Distributed EachYear. If the Participant's Nonforfeitable Interest is to be distributed in other than a single sum, the following minimum distribution rules shall apply on or after the R. equired Beginning Date: (a) Individual Account. (1) If a Participant's Benefit is to be distributed over (i) a period not extending beyond the Life Expectancy of the Participant or the Joint Life and Last Survivor Expectancy of the Participant and the Participant's Designated Beneficiary, or (ii) a period not extending beyond the Life Expectancy of the Designated Beneficiary, the amount required to be distributed for each calendar year, beginning with distributions for the first Distribution Calendar Year, must at least equal the quotient obtained by dividing the Participant's Benefit by the Applicable Life Expectancy. (2) For calendar years beginning before January 1,1989, if the Participant's spouse is not the Designated Beneficiary, the method of distribution selected must assure that at least fifty percent (50%) of the present value of the amount available for distribution is paid within the Life Expectancy of the Participant. (3) For calendar years beginning after December 31, 1988, the amount to be distributed each year, beginning with distributions for the first Distribution CalendarYear shall not be less than the quotient obtained by dividing the Participant's Benefit by the lesser of (i) the Applicable Life Expectancy, or (ii) if the Participant's spouse is not the Designated Beneficiary, the applicable divisor determined from the table set forth in Q&A-4 of section 1.401(a)(9)-2 of the proposed regulations. Distributions a~er the death of the Participant shall be distributed using the Applicable Life Expectancy in Subsection (1) as the relevant divisor without regard to Proposed R. egulatiom section 1.401 (a)(9)-2. (4) The minimum distribution required for the Participant's first Distribution CalendarYear must be made on or before the Participant's Required Begin- ning Date. The minimum distribution for other calendar years, including the minimum distribution for the Distribution CalendarYear in which the Employee's required beginning date occurs, must be made on or before December 31 of that Distribution CalendarYear. Co) Other forms. If the Participant's Benefit is distributed in the form of an annuity purchased from an insurance company, distributions thereunder shall be made in accordance with the requirements of section 401(a)(9) of the Code and the proposed regulations thereunder. Death Distribution Provisions. Upon the death of the Participant, the following distribution . provisions shall take effect: (a) (c) (d) (e) If the Participant dies after distribution of his/her interest has commenced, the remaining portion of such interest will continue to be distributed at least as rapidly as under the method of distribution being used prior to the Participant's death. If the Participant dies before distribution of his/her interest commences, the Participant's entire interest vdll be distributed no later than December 31 of the calendar year containing the fifth (Sth) anniversary of the Participant's death except to the extent that an election is made to receive distributions in accordance with (1) or (2) below: O) If any portion of the Participant's interest is payable to a Designated Benefi- ciary, distributions may be made over the life or over a period certain not greater than the Life Expectancy of the Designated Beneficiary commencing on or before December 31 of the calendar year immediately following the calendar year in which the Participant died; (2) If the Designated Beneficiary is the Participant's surviving spouse, the date distributions are required to begin in accordance with Subsection (1) shall not be earlier than the later of (i) December 31 of the calendar year immedi- ately following the calendar year in which the Participant died, and (ii) December 31 of the calendar year in which the Participant would have attained age seventy and one-half (70-1/2). If the Participant has not made an election pursuant to this Subsection by the time of his/her death, the Participant's Designated Beneficiary must elect the method of distribution no later than the earlier of(i) December 31 of the calendar year in which distributions would be required to begin under this Section, or (ii) December 31 of the calendar year which contains the fifth (5th) anniversary of the date of death of the Participant. If the Participant has no Designated Beneficiary, or if the Desig- nated Beneficiary does not elect a method of distribution, distribution of the Participant's entire interest must be completed by December 31 of the calendar year containing the fifth (5th) anniversary of the Participant's death. For purposes of Subsection (b), if the surviving spouse dies after the Participant, but before payments to such spouse begin, the provisions of Subsection (b), with the exception of paragraph (2) therein, shall be applied as ffthe surviving spouse were the Participant. For purposes of this Section, any amount paid to a child of the Participant will be treated as if it had been paid to the surviving spouse if the amount becomes payable to the surviving spouse when the child reaches the age ofmajority. For the purposes of this Section, distribution of a Participant's interest is considered to begin on the Participant's R. equired Beginning Date (or, if Subsection (c) is applicable, the date distribution is required to begin to the surviving spouse pursuant to Subsection (b)). If distribution in the form of an annuity irrevocably commences to the participant before the Required Beginning Date, the date distribution is considered to begin is the date distribution actually commences. 10.06 Definitions. For the purposes of this Section, the following definitions shall apply: (a) Applicable Life Expectancy. The Life Expectancy (or Joint and Last Survivor Expect- ancy) calculated using the attained age of the Participant (or Designated Beneficiary) as of the Participant's (or Designated Beneficiary's) birthday in the applicable calendar year reduced by one (1) for each calendar year which has elapsed since the date Life Expectancy was first calculated. If Life Expectancy is being recalculated, the Appli- cable Life Expectancy shall be the Life Expectancy as so recalculated. The applicable calendar year shall be the first Distribution CalendarYear, and if Life Expectancy is b&ing recalculated such succeeding calendar year. (b) Designated Beneficiary. The individual who is designated as the Beneficiary under the Plan in accordance with section 401(a)(9) of the Code and the proposed regula- tions thereunder. (c) Distribution CalendarYear. A calendar year for which a minimum distribution is required. For distributions beginning before the Participant's death, the first Distri- bution CalendarYear is the calendar year immediately preceding the calendar year which contains the Participant's l~equired Beginning Date. For distributions begin- ning after the Participant's death, the first Distribution CalendarYear is the calendar year in which distributions are required to begin pursuant to Section 10.05 above. Life Expectancy. The Life Expectancy and joint and last survivor expectancy, respec- tively, as computed by use of the expected return multiples inTablesV andVI of section 1.72-9 of the income tax regulations. Unless otherwise elected by the Participant (or spouse, in the case of distributions described in Section 10.05(b)(2) above) by the time distributions are required to begin, Life Expectancies shall be recalculated annually. Such election shall be irrevocable as to the Participant (or spouse) and shall apply to all subsequent years. The Life Expectancy of a nonspouse Beneficiary may not be recalculated. (e) Participant's Benefit. (1) The Account balance as of the last Accounting Date in the calendar year immediately preceding the Distribution CalendarYear (valuation calendar year) increased by the amount of any contributions or forfeitures allocated to the Account balance as of dates in the valuation calendar year after such Accounting Date and decreased by distributions made in the valuation calendar year after such Accounting Date. (2) For purposes of paragraph (1) above, if any portion of the minimum distribu- tion for the first Distribution CalendarYear is made in the second Distribu- tion CalendarYear on or before the Kequired Beginning Date, the amount of the minimum distribution made in the second Distribution CalendarYear shall be treated as if it had been made in the immediately preceding Distribu- tion CalendarYear. MPP 24 XI. (0 Required Beginning Date. The Required Beginning Date of a Participant is the first day of April of the calendar year following the calendar year in which the Participant attains age seventy and one-half (70-1/2), or such later date as permit- ted under this Section or section 401(a)(9) of the Code. MODES OF DISTRIBUTION OF BENEFITS 11.01 Normal Mode of Distribution. Unless an elective mode of distribution is elected in accordance with Article XII, benefits shall be paid to the Participant in the form provided for in Article XII. 11.02 Elective Mode of Distribution. Subject to the requirements of Articles X and XII, a Participant may revocably elect to have his/her Account distributed in any one (1) of the following modes in lieu of the mode described in Section 11.01: (a) Equal Payments. Equal monthly, quarterly, semi-annual, or annual payments in an amount chosen by the Participant continuing until the Account is exhausted. (b) Lump Sum. A lump sum payment. (c) Period Certain. Approximately equal monthly, quarterly, semi-annual, or annual payments, calculated to continue for a period certain chosen by the Participant. (d) Other. Any other sequence of payments requested by the Participant. 11.03 Election of Mode. A Participant's election ora payment option must be made in writing between thirty (30) and ninety (90) days before the payment of benefits is to commence. 11.04 Death Benefits. Subject to Articles X and XII, (a) In the case of a Participant who dies before he/she has begun receiving benefit payments, the Participant's entire Nonforfeitable Interest shall then be payable to his/ her Beneficiary within ninety (90) days of the Participant's death. A Beneficiary who is entitled to receive benefits under this Section may elect to have benefits com- mence at a later date, subject to the provisions of Section 10.05. The Beneficiary may elect to receive the death benefit in any of the forms available to the Participant under Section 11.02. If the Beneficiary is the Participant's Surviving Spouse, and such Surviving Spouse dies before payment commences, then this Section shall apply to the beneficiary of the Surviving Spouse as though such Surviving Spouse were the Participant. Should the Participant die after he/she has begun receiving benefit payments, the Beneficiary shall receive the remaining benefits, if any, that are payable, under the payment schedule elected by the Participant. Notwithstanding the foregoing, the Beneficiary may elect to accelerate payments of the remaining balances, including but not limited to, a lump sum distribution. MPP 0413O12OOO 25 XII. SPOUSAL BENEFIT IKEQUII:kEMENTS 12.01 Application. The provisions of this Article shall take precedence over any conflicting provision in this Plan. The provisions of this Article shall apply to any Participant who is credited with any Period of Service with the Employer on or after August 23, 1984, and such other Participants as provided in Section 12.05. 12.02 Qualified Joint and Survivor Annuity. Unless an optional form of benefit is selected pursuant to a Qualified Election within the ninety (90) day period ending on the Annuity Startin~ Date, a married Participant'sVested Account Balance will be paid in the form of a Qualified Joint and Survivor Annuity and an unmarried Participant's Vested Account Balance will be paid in the form ora Straight Life Annuity. The Participant may elect to have such annuity distributed upon the attainment of the Earliest P,.etirement Age under the Plan. 12.03 Qualified Preretirement Survivor Annui~. Ifa Participant dies before the Annuity Starting Date, then fifty percent (50%) of the Participant's Vested Account Balance shall be applied toward the purchase of an annuity for the life of the Surviving Spouse; the remaining portion shall be paid to such Beneficiaries (which may include such Spouse) designated by the Participant. Notwithstanding the foregoing, the Participant may waive the spousal annuity by designating a different Beneficiary within the Election Period pursuant to a Qualified Election. To the extent that less than one hundred percent (100%) of the vested Account balance is paid to the Surviving Spouse, the amount of the Participant's Account derived from Employee contributions will be allocated to the Surviving Spouse in the same proportion as the amount of the Participant's Account derived from Employee contributions is to the Participant's totalVested Account Balance. The Surviving Spouse may elect to have such annuity distributed within a reasonable period after the Participant's death. Further, such Spouse may elect to receive any death benefit payable to him/her hereunder in any ofthe forms available to the Participant under Section 11.02. 12.04 Notice I~equirements. (a) In the case of a Qualified Joint and Survivor Annuity as described in Section 12.02, the Plan Administrator shall, no less than thirty (30) days and no more than ninety (90) days prior to the Annuity Starting Date, provide each Participant a written explanation of. (i) the terms and conditions of a Qualified Joint and Survivor Annu- ity; (ii) the Participant's right to make and the effect of an election to waive the Qualified Joint and Survivor Annuity form of benefit; (iii) the rights of a Participant's Spouse; and (iv) the right to make, and the effect of, a revocation of a previous election to waive the Qualified Joint and Survivor Annuity. However, if the Partici- pant, after having received the written explanation, affirmatively elects a form of distribution and the Spouse consents to that form of distribution (if necessary), benefit payments may commence less than 30 days after the written explanation was provided to the Participant, provided that the following requirements are met: (1) The Plan Administrator provides information to the Participant clearly indicating that the Participant has a right to at least 30 days to consider MPP 04/30/2000 26 (b) whether to waive the Qualified Joint and Survivor Annuity and consent to a form of distribution other than a Qualified Joint and Survivor Annuity; (2) The Participant is permitted to revoke an affirmative distribution election at least until the Annuity Starting Date, or if later, at any time prior to the expiration of the 7-day period that begins the day after the explanation of the Qualified Joint and Survivor Annuity is provided to the Participant; The Annuity Starting Date is after the date that the explanation of the Qualified Joint and Survivor Annuity is provided to the Participant; and (4) Distribution in accordance with the affirmative election does not com- mence before the expiration of the 7-day period that begins after the day after the explanation of the Qualified Joint and Survivor Annuity is pro- vided to the Participant. In the case of a qualified preretirement survivor annuity as described in Section 12.03, the Plan Administrator shall provide each Participant within the applicable period for such Participant a written explanation of the qualified preretirement survivor annuity in such terms and in such manner as would be comparable to the explanation provided for meeting the requirements of Subsection (a) applicable to a Qualified Joint and Survivor Annuity. The applicable period for a Participant is whichever of the following periods ends last: (i) the period beginning with the first day of the PlanYear in which the Partici- pant attains age thirty-two (32) and ending with the close of the PlanYear preceding the PlanYear in which the Participant attains age thirty-five (35); (ii) a reasonable period ending after the individual becomes a Participant; (iii) a reasonable period ending after Subsection (c) ceases to apply to the Participant; (iv) a reasonable period ending after this Article first applies to the Participant. Notwithstanding the forego- ing, notice must be provided within a reasonable period ending after separation from service in the case ora Participant who separates from service before attaining age thirty-five (35). For purposes of applying the preceding paragraph, a reasonable period ending after the enumerated events described in (ii), (iii) and (iv) is the end of the two (2) year period beginning one (1) year prior to the date the applicable event occurs, and ending one (1) year after that date. In the case of a Participant who separates from service before the PlanYear in which age thirty-five (35) is attained, notice shall be provided within the two (2) year period beginning one (1) year prior to separation and ending one (1) year after separation. If such a Participant therea~er returns to employment with the Employer, the applicable period for such Participant shall be redetermined. Notwithstanding the other requirements of this Section, the respective notices prescribed by this Section need not be given to a Participant if (1) the Plan "fully subsidizes" the costs of a Qualified Joint and Survivor Annuity or qualified prere- tirement survivor annuity, and (2) the Plan does not allow the Participant to waive MPP 0413012~0 ' 27 the Qualified Joint and Survivor Annuity or qualified preretirement survivor annuity and does not allow a married Participant to designate a non-Spouse Beneficiary. For purposes of this Subsection (c), a pIan fully subsidizes the costs of a benefit if no increase in cost or decrease in benefits to the Participant may result from the Participant's failure to elect another benefit. 12.05 Definitions. For the purposes of this Section, the following definitions shall apply: (a) Annuity Starting Date: The first day of the first period for which an amount is paid a.4 an annuity or-any other form. Election Period: The period which begins on the first day of the PlanYear in which the Participant attains age thirty-five (35) and ends on the date of the Participant's death. Ifa Participant separates from service prior to the first day of the PlanYear in which age thirty-five (35) is attained, with respect to the Account balance as of the date of separation, the Election Period shall begin on the date of separation. Pre-age thirty-five (35) waiver: A Participant who will not yet attain age thirty-five (35) as of the end of any current PlanYear may make a special Qualified Election to waive the qualified preretirement survivor annuity for the period beginning on the date of such election and ending on the first day of the PlanYear in which the Participant will attain age thirty-five (35). Such election shall not be valid unless the Participant receives a written explanation of the qua.lifted preretirement survivor annuity in such terms as are comparable to the explanation required under Section 13.04(a). Q:~l_ified preretirement survivor annuity coverage will be automatically reinstated as of the first day of the PlanYear in which the Participant attains age thirty-five (35). Any new waiver on or a~er such date shall be subject to the full requirements of this Article. (c) Earliest t~etirement Age: The earliest date on which, under the Plan, the Participant could elect to receive retirement benefits. (d) Qualified Election: A waiver of a Qualified Joint and Survivor Annuity or a qualified preretirement survivor annuity. Any waiver of a Qualified Joint and Survivor Annuity or a qualified preretirement survivor annuity shall not be effective unless: (a) the Participant's Spouse consents in writing to the election; (b) the election designates a specific Beneficiary, including any class of Beneficiaries or any contingent Beneficia- ries, which may not be changed without spousal consent (or the Spouse expressly permits designations by the Participant without any further spousal consent); (c) the Spouse's consent acknowledges the effect of the election; and (d) the Spouse's con- sent is witnessed by a Plan representative or notary public. Additionally, a Participant's waiver of the Qualified Joint and Survivor Annuity shall not be effective unless the election designates a form of benefit payment which may not be changed without spousal consent (or the Spouse expressly permits designations by the Partici- pant without any further Spousal consent). If it is established to the satisfaction of a Plan representative that there is no Spouse or that the Spouse cannot be located, a waiver will be deemed a Qualified Election. IvIPP 0413012000 Any consent by a Spouse obtained under this provision (or establishment that the consent of a Spouse may not be obtained) shall be effective only with respect to such Spouse. A consent that permits designations by the Participant without any require- ment of further consent by such Spouse must acknowledge that the Spouse has the right to limit consent to a specific Beneficiary, and a specific form ofbenefit where applicable, and that the Spouse voluntarily elects to relinquish either or both of such rights. A revocation of a prior waiver may be made by a Participant without the consent of the Spouse at any time before the commencement of benefits. The number of revocations shall not be limited. No consent obtained under this provi- sion shall be valid unless the Participant has received notice as provided in Section 12.04. Qualified Joint and Survivor Annuity: An immediate annuity for the life of the Participant with a survivor annuity for the life of the Spouse which is not less than fifty percent (50%) and not more than one hundred percent (100%) of the amount of the annuity which is payable during the joint lives of the Participant and the Spouse and which is the amount of benefit which can be purchased with the Participant's Vested Account Balance. The percentage of the survivor annuity shall be fifty per- cent (50%). Spouse (Surviving Spouse): The Spouse or Surviving Spouse of the Participant, provided that a former Spouse will be treated as the Spouse or Surviving Spouse and a current Spouse will not be treated as the Spouse or Surviving Spouse to the extent provided under a qualified domestic relations order as described in section 414(p) of the Code. Straight Life Annuity: An annuity payable in equal installments for the life of the Participant that terminates upon the Participant's death. Vested Account Balance: The aggregate value of the Participant's vested Account balances derived from Employer and Employee contributions (including rollovers), whether vested before or upon death, including the proceeds of insurance contracts, if any, on the Participant's life. The provisions of this Article shall apply to a Partici- pant who is vested in amounts attributable to Employer Contributions, Employee contributions (or both) at the time of death or distribution. 12.06 Annuity Contracts. Where benefits are to be paid in the form of a life annuity pursuant to the terms of this Article, a nontransferable annuity contract shall be purchased from a life insurance company and distributed to the Participant or Surviving Spouse, as applicable. The terms of any annuity contract purchased and distributed by the Plan shall comply with the requirements of this Plan and section 417 ofthe Code. MPP 04/30/2000 29 XIII. LOANS TO PAKTICIPANTS 13.01 Availability of Loans to Participants. (a) If the Employer has elected in the Adoption Agreement to make loans available to Participants, a Participant may apply for a loan from the Plan subject to the limita- tions and other provisions of this Article. The Employer shall establish written guidelines governing the granting of loans, provided that such guidelines are approved by the Plan Administrator and are not inconsistent with the provisions of this Article, and that loans are made available to all Participants on a reasonably equivalent basis. 13.02 Terms and Conditions of Loans to Participants. Any loan by the Plan to a Participant under Section 13.01 of the Plan shall satisfy the following requirements: (a) Availability. Loans shall be made available to all Participants on a reasonably equiva- lent basis. (b) Nondiscrimination. Loans shall not be made to highly compensated Employees in an amount greater than the amount made available to other Employees. (c) Interest Rate. Loans must be adequately secured and bear a reasonable interest rate. (d) Loan Limit. No Participant loan shall exceed the present value of the Participant's Nonforfeitable Interest in his/her Account. (e) Spousal Consent. A Participant must obtain the consent of his/her Spouse, as de- fined under Section 12.05 if any, within the ninety (90) day period before the time the Account balance is used as security for the loan. Spousal consent shall be ob- tained no earlier than the beginning of the ninety (90) day period that ends on the date on which the loan is to be so secured. The consent must be in writing, must acknowledge the effect of the loan, and must be witnessed by a Plan representative or notary public. Such consent shall thereafter be binding with respect to the con- senting Spouse or any subsequent Spouse with respect to that loan. A new consent shall be required if the Account balance is used for renegotiation, extension, renewal, or other revision of the loan. Foreclosure. In the event ofdefault, foreclosure on the note and attachment of security will not occur until a distributable event occurs in the Plan. Reduction of Account. If a valid spousal consent has been obtained in accordance with Subsection (e), then, notwithstanding any other provision of this Plan, the portion of the Participant's vested Account balance used as a security interest held by the Plan by reason of a loan outstanding to the Participant shall be taken into count for purposes of determining the amount of the Account balance payable at the time of death or distribution, but only if the reduction is used as repayment of the MPP 0413012000 3O loan. If less than one hundred percent (100%) of the Participant's nonforfeitable Account balance (determined without regard to the preceding sentence) is payable to the surviving spouse, then the Account balance shall be adjusted by first xeducing the nonforfeitable Account balance by the amount of the security used as repayment of the loan, and then determining the benefit payable to the surviving spouse. Amount of Loan. At the time the loan is made, the principal amount of the loan plus the outstanding balance (principal plus accrued interest) due on any other outstanding loans to the Participant or Beneficiary from the Plan and from all other plans of the Employer that are qualified employer plans under section 72(p)(4) of the Code shall not exceed the least (1) $50,000, reduced by the excess (ifany) of (a) The highest outstanding balance ofloans from the Plan during the one (1) year period ending on the day before the date on which the loan is made, over (b) The outstanding balance of loans from the Plan on the date on which such loan is made; or (2) The greater of (a) $10,000, or One-half (1/2) of the value of the Participant's Nonforfeitable Inter- est in all of his/her Accounts under this Plan. For the purpose of the above limitation, all loans from all qualified employer plans under section 72(p)(4) of the Code are aggregated. (i) Application for Loan. The Participant must give the Employer adequate written notice, as determined by the Employer, of the amount and desired time for receiving a loan. No more than one (1) loan may be made by the Plan to a Participant in any calendar year. No loan shall be approved if an existing loan from the Plan to the Participant is in default to any extent. 0) Length of Loan. The terms ofany loan issued or renegotiated after December 31, 1993, shall require the Participant to repay the loan in substantially equal installments of principal and interest, at least monthly, over a period that does not exceed five (5) years from the date ofthe loan; provided, however, that ffthe proceeds of the loan are applied by the Participant to acquire any dwelling unit that is to be used within a reasonable time (determined at the time the loan is made) after the loan is made as the principal residence of the Participant, the five (5) year limit shall not apply. In this event, the period of repayment shall not exceed a reasonable period determined by the Employer. Principal installments and interest payments otherwise due may be suspended during an authorized leave of absence, ffthe promissory note so provides, MPP 04/30/2000 3! 13.03 but not beyond the original term permitted under this Subsection (j), with a revised payment schedule (within such term) instituted at the end of such period of suspen- sion. (k) Prepayment. The Participant shall be permitted to repay the loan in whole or in part at any time prior to maturity, without penalty. (1) Note. The loan shall be evidenced by a promissory note executed by the Participant a. nd delivered to the Employer, and shall bear interest at a reasonable rate determined by the Employer. (m) Security. The loan shall be secured by an assignment of that portion the Participant's right, title and interest in and to his/her Employer Contribution Account (to the extent vested), Participant Contribution Account, and Portable Benefits Account that is equal to fifty percent (50%) of the Participant's Account (to the extent vested). (n) (o) Assignment or Pledge. For the purposes of paragraphs (la) and (i), assignment or pledge of any portion of the Participant's interest in the Plan and a loan, pledge, or assignment with respect to any insurance contract purchased under the Plan, will be treated as a loan. OtherTerms and Conditions. The Employer shall fix such other terms and condi- tions of the loan as it deems necessary to comply with legal requirements, to main- rain the qualification of the Plan and Trust under section 401(a) of the Code, or to prevent the treatment of the loan for tax purposes as a distribution to the Participant. The Employer, in its discretion for any reason, may fix other terms and conditions of the loan, not inconsistent with the provisions of this Article. Participant Loan Accounts. (a) Upon approval of a loan to a Participant by the Employer, an amount not in excess of the loan shall be transferred from the Participant's other investment fund(s), described in Section 6.05 of the Plan, to the Participant's Loan Account as of the Accounting Date immediately preceding the agreed upon date on which the loan is to be made. The assets of a Participant's Loan Account may be invested and reinvested only in promissory notes received by the Plan from the Participant as consideration for a loan permitted by Section 13.01 of the Plan or in cash. Uninvested cash balances in a Participant's Loan Account shall not bear interest. No person who is otherwise a fiduciary of the Phn shall be liable for any loss, or by reason of any breach, that results from the Participant's exercise of such control. (c) Repayment of principal and payment of interest shall be made by payroll deduction or, where repayment cannot be made by payroll deduction, by check, and shall be invested in one (I) or more other investment funds, in accordance with Section 6.05 of the Plan, as of the next Accounting Date after payment thereof to theTrust. The amount so invested shall be deducted from the Participant's Loan Account. MPP 04130/2000 XIV. 0) The Employer shall have the authority to establish other reasonable rules, not in- consistent with the provisions of the Plan, governing the establishment and mainte- nance of Participant Loan Accounts. PLAN AMENDMENT, TERMINATION AND OPTIONAL PROVISIONS 14.01 Amendment by Employer. The Employer reserves the right, subject to Section 14.02 of the Plan, to amend the Plan from time to time by either: (a) Filing an amended Adoption Agreement to change, delete, or add any optional provision, or (b) Continuing the Plan in the form of an amended and restated Plan and Trust. No amendment to the Plan shall be effective to the extent that it has the effect of decreas- ing a Participant's accrued benefit. Notwithstanding the preceding sentence, a Participant's Account balance may be reduced to the extent permitted under section 412(c)(8) of the Code. For purposes ofthis paragraph, a Plan amendment which has the effect of decreas- ing a Participant's Account balance or eliminating an optional form of benefit, with respect to benefits attributable to service before the amendment shall be treated as reducing an accrued benefit. Furthermore, if the vesting schedule of the Plan is amended, in the case of an Employee who is a Participant as of the later ofthe date such amendment is adopted or the date it becomes effective, the nonfoffeitable percentage (determined as of such date) of such Employee's right to his/her Employer-derived accrued benefit will not be less than his percentage computed under the plan without regard to such amendment. The Employer may (1) change the choice of options in the Adoption Agreement, (2) add overriding language in the Adoption Agreement when such language is necessary to satisfy sections 415 or 416 of the Code because of the required aggregation of multiple plans, and (3) add certain model amendments published by the Internal Revenue Service. 14.02 Amendment of Vesting Schedule. If the Han's vesting schedule is amended, or the Plan is amended in any way that directly or indirectly affects the computation of the Participant's nonfoffeitable percentage, each Participant may elect, within a reasonable period after the adoption of the amendment or change, to have the nonfoffeitable percentage computed under the Plan without regard to such amendment or change. The period during which the election may be made shall commence with the date the amendment is adopted or deemed to be made and shall end on the latest of.' (a) Sixty (60) days after the amendment is adopted; (b) Sixty (60) days after the amendment becomes effective; or (c) Sixty (60) days a~er the Participant is issued written notice of the amendment by the Employer or Plan Administrator. MPP 041~012000 · 33 XV. 14.03 Termination by Employer. The Employer reserves the right to terminate this Plan. How- ever, in the event of such termination no part of the Trust shall be used or diverted to any purpose other than for the exclusive benefit of the Participants or their Beneficiaries, except as provided in this Section. Upon Plan termination or partial termination, all Account balances shall be valued at their fair market value and the Participant's right to his/her Employer Contribution Account shall be one hundred percent (100%) vested and nonforfeitable. Such amount and any other amounts held in the Participant's other Accounts shall be maintained for the Par- ticipan~ until paid pursuant to the terms of the Plan. Any amounts held in a suspense account, after all liabilities of the Plan to Participants and Beneficiaries have been satisfied or provided for, shall be paid to the Employer in accor- dance with the Code and regulations thereunder. In the event that the Commissioner of Internal Revenue determines that the Plan is not initially qualified under the Internal P,.evenue Code, any contribution made by the Em- ployer incident to that initial qualification must be returned to the Employer within one year after the date the initial qualification is denied, but only ffthe application for the qualification is made by the time prescribed by law for filing the Employer's return for the year in which the Plan is adopted, or such later date as the Secretary of the Treasury may prescribe. 14.04 Discontinuance of Contributions. A permanent discontinuance of contributions to the Plan by the Employer, unless an amended and restated Plan is established, shall constitute a Plan termination. 14.05 Amendment by Plan Administrator. The Plan Administrator may amend this Plan upon thirty (30) days written notification to the Employer; provided, however, that any such amendment must be for the express purpose of maintaining compliance with applicable federal laws and regulations of the Internal Revenue Service. Such amendment shall become effective unless, within such 30-day period, the Employer notifies the Administra- tor, in writing, that it disapproves such amendment, in which case such amendment shall not become effective. In the event of such disapproval, the Administrator shall be under no obligation to continue acting as Administrator hereunder. 14.06 Optional Provisions. Any provision which is optional under this Plan shall become effec- tive if and only if elected by the Employer and agreed to by the Plan Administrator. ADMINISTB. ATION 15.01 Powers of the Employer. The Employer shall have the following powers and duties: (a) To appoint and remove, with or without cause, the Plan Administrator; (b) To amend or terminate the Plan pursuant to the provisions of Article XIV; MPP 0413012000 15.02 15.03 :(0 To appoint a committee to ficilitate administration of the Plan and communications to Participants; To decide all questions of eligibility (1) for Plan participation, and (2) upon appeal by any Participant, Employee or Beneficiary, for the payment of benefits; To engage an independent qualified public accountant, when required to do so by law, to prepare annually the audited financial statements of the Plan's operation; To take all actions and to communicate to the Plan Administrator in writing all necessary information to carry out the terms of the Plan and Trust; and (g) To notify the Plan Administrator in writing of the termination of the Plan. Duties of the Plan Administrator. The Phn Administrator shall have the following powers and duties: (a) To construe and interpret the provisions of the Phn; (b) To maintain and provide such returns, reports, schedules, descriptions, and individual Account statements, as are required by law within the times prescribed by law; and to furnish to the Employer, upon request, copies of any or all such materials, and further, to make copies of such instruments, reports, descriptions, and statements as are required by law available for examination by Participants and such of their Beneficiaries who are or may be entitled to benefits under the Plan in such places and in such manner as required by law; (c) To obtain from the Employer such information as shall be necessary for the proper administration of the Plan; (d) To determine the amount, manner, and time of payment of benefits hereunder; (e) To appoint and retain such agents, counsel, and accountants for the purpose of properly administering the Plan; To distribute assets of the Trust to each Participant and Beneficiary in accordance with Article X of the Plan; (g) To pay expenses from the Trust pursuant to Section 6.03 of the Plan; and To do such other acts reasonably required to administer the Plan in accordance with its provisions or as may be provided for or required by law. Protection of the Employer. The Employer shall not be liable for the acts or omissions of the Plan Administrator, but only to the extent that such acts or omissions do not result from the Employer's failure to provide accurate or timely information as required or necessary for proper administration of the Plan. MPP 041~0/2000 · 35 15.04 Protection of the Plan Administrator. The Plan Administrator may rely upon any certifi- cate, notice or direction purporting to have been signed on behalf of the Employer which the Plan Administrator believes to have been signed by a duly designated official of the Employer. 15.05 Resignation or Removal of Plan Administrator. The Plan Administrator may resign at any time effective upon sixty (60) days prior written notice to the Employer. The Plan Admin- istrator may be removed by the Employer at any time upon sixty (60) days prior written notice '~o the Plan Administrator. Upon the resignation or removal of the Plan Administra- tor, the Employer may appoint a successor Plan Administrator; failing such appointment, the Employer shall assume the powers and duties of Plan Administrator. Upon the resigna- tion or removal of the Plan Administrator, any Trust assets invested by or held in the name of the Plan Administrator shall be transferred to the trustee in cash or property, at fair market value, except that the return of Trust assets invested in a contract issued by an insurance company shall be governed by the terms of that contract. 15.06 No Termination Penalty. The Plan Administrator shall have no authority or discretion to impose any termination penalty upon its removal. 15.07 Decisions of the Plan Administrator. All constructions, determinations, and interpretations made by the Plan Administrator pursuant to Section 15.02(a) or (d) shall be final and binding on all persons participating in the Plan, given deference in all courts of law to the greatest extent allowed by applicable law, and shall not be overturned or set aside by any court of law unless found to be arbitrary or capricious, or made in bad faith. MISCELLANEOUS 16.01 Nonguarantee of Employment. Nothing contained in this Plan shall be construed as a contract of employrnent between the Employer and any Employee, or as a right of an Employee to be continued in the employment of the Employer, as a limitation of the right of the Employer to discharge any of its Employees, with or without cause. 16.02 Kights to Trust Assets. No Employee or Beneficiary shall have any right to, or interest in, any assets of the Trust upon termination of his/her employment or otherwise, except as provided from time to time under this Plan, and then only to the extent of the benefits payable under the Plan to such Employee or Beneficiary out of the assets of the Trust. All payments of benefits as provided for in this Plan shall be made solely out of the assets of the Trust and none of the fiduciaries shall be liable therefor in any manner. 16.03 Nonalienation of Benefits. Except as provided in Section 16.04 of the Plan, benefits payable under this Plan shall not be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, charge, garnishment, execution, or levy of any kind, either voluntary or involuntary, prior to actually being received by the person en- titled to the benefit under the terms of the Plan; and any attempt to anticipate, alienate, sell, transfer, assign, pledge, encumber, charge or otherwise dispose of any right to benefits MPP 041~012000 16.04 16.05 16.06 16.07 payable hereunder, shall be void. The Trust shall not in any manner be liable for, or subject to, the debts, contracts, habilities, engagements or torts of any person entitled to benefits hereunder. Qualified Domestic Relations Order. Notwithstanding Section 16.03 of the Plan, amounts may be paid with respect to a Participant pursuant to a domestic relations order, but if and only if the order is determined to be a qualified domestic relations order within the mean- ing of section 414(p) of the Code or any domestic relations order entered before January 1, 1985. Nonfoffeitability of Benefits. Subject only to the specific provisions of this Plan, nothing shall be deemed to deprive a Participant of his/her right to the Nonforfeitable Interest to which he/she becomes entitled in accordance with the provisions of the Plan. Incompetency of Payee. In the event any benefit is payable to a minor or incompetent, to a person otherwise under legal disability, or to a person who, in the sole judgment of the Employer, is by reason of advanced age, illness, or other physical or mental incapacity incapable of handling the disposition of his/her property, the Employer may apply the whole or any part of such benefit directly to the care, comfort, maintenance, support, education, or use of such person or pay or distribute the whole or any part of such benefit tO: (a) The parent of such person; (b) The guardian, committee, or other legal representative, wherever appointed, of such person; (c) The person with whom such person resides; (d) Any person having the care and control ofsuch person; or (e) Such person personally. The receipt of the person to whom any such payment or distribution is so made shall be full and complete discharge therefore. Inability to Locate Payee. Anything to the contrary herein notwithstanding, if the Em- ployer is unable, after reasonable effort, to locate any Participant or Beneficiary to whom an amount is payable hereunder, such amount shall be forfeited and held in the Trust for apphcation against the next succeeding Employer Contribution or contributions required to be made hereunder. Notwithstanding the foregoing, however, such amount shall be reinstated, by means of an additional Employer contribution, ffand when a claim for the forfeited amount is subsequently made by the Participant or Beneficiary or ff the Employer receives proof of death of such person, satisfactory to the Employer. To the extent not inconsistent with apphcable law, any benefits lost by reason of escheat under apphcable state law shall be considered forfeited and shall not be reinstated. MPP 04/~0/2000 ' 16.08 Mergers, Consolidations, and Transfer of Assets. The Plan shall not be merged into or consolidated with any other plan, nor shall any of its assets or liabilities be transferred into any such other plan, unless each Participant in the Plan would (if the Plan then terminated) receive a benefit immediately after the merger, consolidation, or transfer that is equal to or greater than the benefit he/she would have been entitled to receive immediately before the merger, consolidation, or transfer (if the Plan had then terminated). 16.09 Employer Records. Records of the Employer as to an Employee's or Participant's Period of Service, termination of service and the reason therefor, leaves of absence, reemployment, Earnifigs, and Compensation will be conclusive on all persons, unless determined to be incorrect. 16.10 Gender and Number. The masculine pronoun, whenever used herein, shall include the feminine pronoun, and the singular shall include the plural, except where the context requires otherwise. 16.11 Applicable Law. The Plan shall be construed under the laws ofthe State where the Em- ployer is located, except to the extent superseded by federal law. The Plan is established with the intent that it meets the requirements under the Code. The provisions of this Plan shall be interpreted in conformity with these requirements. In the event of any conflict between the Plan and a policy or contract issued hereunder, the Plan provisions shall control; provided, however, no Plan amendment shall supersede an existing policy or contract unless such amendment is required to maintain qualification under section 401 of the Code. MPP 04/~0/2000 ICMA R. ETIR£MENT COR. POR. ATION INTERNAL REVENUE SERVICE DETERMINATION LETTER INTERNAL REVENUE SERVICE DISTRICT DIRECTOR P. O. BOX 2508 ci cI ATI, ox 4 2Ol Da:e: 0,2 DEPARTMENT OF THE TREASURY Employer Identification Number: DLN: 17007257030028 Person to Contact: DONALD G KRULCZYK Contact Telephone Number: (877) 829-5500 Plan Name: ID# 3125S Dear Applicant: We have made a favorable determination on your plan, identified above, based on the information supplied. Please keep this letter in your permanent records. Continued qualification of the plan under its present form will depend on its effect in opera~ion. (See section 1.401-1(b) (3) of the Income Tax Regulations.) We will review the status of the plan in operation periodically. The enclosed document explains the significance of this favorable determine=ion letter, points out some events that may affect the qualified status of your employee retirement plan, and provides information on the reporting requirements for your plan. It also describes some events that automatically nullify it. It is very important that you read the publication. This letter relates only to the status of your plan under the Internal Revenue Code. It is not a determination regarding the effect of other federal or local statutes. This determination is subject to your adoption of the proposed amendments submi:ted in your letter dated December 1, 1999. The proposed amendments should be adop=ed on or before the date prescribed by the regulations under Code section 401(b). This determination letter is applicable for the plan adopted on March 5, 1998. This letter considers the changes in the qualifications requirements made by the Uruguay Round Agreements Ac= (GATT), Pub. L. 103-465, and the Taxpayer Relief Act of 1997, Pub. L. 105-34, and the changes in the qualifications requirements made by the Small Business Job Protection Act of 1996, Pub. L. 104-188, that are effective before the first day of the firs= plan year beginning after December 31, 1998. The information on the enclosed Publication 794 is an integral par= of this determination. Please be sure to read and keep it with this letter. The requirement for employee benefits plans to file summary plan descriptions (SPD) with the U.S. Department of Labor was eliminated effective Let=er 835 (DO/CG) WASHINGTON CONVENTION CENTER -2- Augus= 5, 1997. For more de=ails, call 1-800-998-7542 for a free copy of SPD card. The informa=ion on =he enclosed addendum is an in=egral par= of =his de=ermina=ion. Please be sure =o read and keep i= wi=h =his le==er. We have sen= a copy of =his le==er =o your represen=a=ive as indica=ed in =he power of a==orney. If you have ques=ions concerning =his mac=er, please con=ac= =he person whose name and =elephone number are sho~ above. Enclosures: Publica=ion 794 Addendum Sincerely yours, 835 (DO/CG) Department of the Treasury Revenue Publicltlon 794 (~v. ~ 1~g8) Catalog Number 20630M Favorable Determination Letter Introduction This publication explains the significance of your favorable determination letter, points out some features that may affect the quali- fied status of your employee retirement plan and nullify your determination letter without specific notice from us, and provides general information on the reporting requirements for your plan. Significance of a Favorable Determination Letter An employee retirement plan qualified under Internal Revenue Code section 401(a) (qualified plan) is entitled to favor- able tax treatment. For example, contri- butions made in accordance with the plan document are generally currently deductible. However, participants will not include these contributions into income until the time they receive a distribution from the plan, at which time special income averaging rates for lump sum distributions may serve to reduce the tax liability. In some cases, taxation may be further deferred by rollover to another qualified plan or individual retirement arrangement. (See Publication 575, Pension and Annuity Income, for further details.) Finally, plan earnings may accumulate free of tax. Employee retirement plans that fail to satisfy the requirements under Code section 401(a) are not entitled to favorable tax treatment. Therefore, many employers desire advance assurance that the terms of their plans satisfy the qualification require- ments. The Internal Revenue Service provides such advance assurance by means of the determination letter program. A favorable determination letter indicates that, in the opinion of the Service, the terms of the plan conform to the requirarnents of Internal Revenue Code section 401(a). In addition, a favorable determination letter may indicate that, on the basis of other information provided in your application, it has been demonstrated that the plan satis- ties certain nondiscrimination requirements of Code section 401(a). See the following topic, Umitations of a Favorable Determination Letter, for more details. Limitations of a Favorable Determination Letter A favorable determination letter is limited in scope and may also have a limited useful life. A determination letter generally applies to qualification requirements regarding the form of the plan. A determi- nation letter may also apply to other qualifi- cation requirements pertaining to the prohi- bition against discriminabon in favor of highly compensated employees. These requirements are generally referred to as the coverage and nondiscrimination requirements. They include the nondiscrim- ination requirements of section 401(a)(4) of the Code, the minimum coverage require- ments of section 410(b), and certain related requirements. The extent to which a determination letter applies to the coverage and nondis- crimination requirements depends on the terms of the plan, the scope of the determi- nation you requested, and the additional information you supplied with your applica- tion. Your determination letter will contain specific statements that will describe the scope of reliance represented by the letter. In addition, the following apply gener- ally to all determination letters: · The determination letter may not include a statement regarding the minimum coverage requirements of Code section 410(b); this means that you have demon- strated that the plan satisfies these require- ments by satisfying the ratio-percentage test. · A favorable determination letter means that you have demonstrated that the plan satisfies the minimum participation requirements of Code section 401(a)(26). · If you maintain two or more retire- ment plans some of which were either not submitted to the Service for determination or not disclosed on each application, certain limitations and requirements will not have been considered on an aggregate basis. Therefore, you may not rely on the determination letter regarding the plans when considered as a total package. · A determination letter does not consider the special requirements relating to: (a) affiliated service groups, (b) leased employees, or (c) plan assets or liabilities involved in a merger, consohdation, spin-off or transfer of assets with another plan unless the letter includes a statement that the requirements of Internal Revenue Code section 414(m) (affiliated service groups), or 414(n) (leased employees) or 414(I) (mergers, consolidations, spin-offs, or transfers) have been considered. · For plans that are not amended to comply with the final nondiscrimination regulations retroactively to the 1989 plan year, a determination letter may not be relied upon as to whether plan provisions satisfy a good faith interpretation of the requirements of section 401(a)(4) and t'elated sections of the Code. · No determination letter may be relied on with respect to the effective availability of benefits, rights, or features under the plan. (See section 1.401(a)(4)-4(c) of the Income Tax Regulations.) Reliance on whether benefits, rights, or features are currently available to a non-discriminatory group of employees is provided to the extent specified in the letter. · A determination letter does not consider whether actuarial assumptions are reasonable for funding or deduction purposes or whether a specific contribution is deductible. · A determination letter does not consider and may not be relied on with respect to certain other matters described in section 5.07 of Rev. Proc. 98-6, 1998-1 I.R.B. 183 (i.e., whether a plan amendment is part of a pattern of amendments that significantly discriminates in favor of highly compensated employees; the use of the substantiation guidelines contained in Rev. Proc. 93-42, 1993-31 I.R.B. 32; and certain qualified separate lines of business require- ments of section 414(r) of the Code). · The determination letter applies only to the employer and its participants on whose behalf the determination letter was issued. · A determination letter does not express an opinion whether disability bene- fits or medical care benefits are acceptable as accident or health plan benefits deductible under IRC section 105 or 106. Become familiar with the terms of the determination letter. Please call the contact person listed on the determination letter if you do not understand any terms in your determination letter. Retention of Information. Whether a plan meets the qualification requirements is determined from the information in the written plan document, the application form and the supporting information submitted by the employer. Therefore, you must retain copies of any demonstrations or other information aubmitted with your applica- tion. Such demonetretions determine the extent of reliance provided by your determination letter. Failure to retain such Information may limit the ~cope of reliance on Issues for which demonstra- tions were provided. We have not verified this information. The determination letter will not provide reliance if: (1) there has been a misstatement or omission of material facts, (for example, the application indicated that plan was a governmental plan and it was not a govern- mental plan). (2) the facts subsequently developed are materially different than the facts on which the determination was made, or (3) there is a change in applicable law. Law changea affecting the plan. In general, a determination letter is issued based on the law in effect at the time the application is received. For termination plans, a determination letter is based on the law in effect at the time of the plan's termination. However, your letter may include a statement indicating an exception to this rule. Amendments to the plan. A favorable determination letter may no longer apply if there is a change in a statute, regulation, or revenue ruling applicable to the qualifica- tion of the plan. However, the determina- tion letter will continue to apply for years before the effective date of the statute, regulation, or revenue ruling. If the letter no longer applies to the plan, the plan must be amended to comply with the new requirements to maintain its qualified status. Generally, if a regulation changes, the amendment must be adopted by the end of the first plan year beginning after the adop- tion date of the regulation. Generally, if a revenue ruling changes, the amendment must be adopted by the end of the first plan year beginning after the publication date of the revenue ruling. Generally, the amend- ment must be effective not later than the first day of such plan year. Extended Reliance. In general, individually designed plans (not master or prototype plans) submitted for a determination letter before July 1, 1994 need not be amended for, or comply in operation with subsequent Treasury regulations or other guidance (for example, revenue rulings, notices, etc.) issued by the Service after the date of the plan determination letter until the last day of the last plan year commencing prior to January 1, 1999, unless specifically stated otherwise. However, plans must be amended by any date(s) established for plan amend- ment by subsequent legislation. If the determination letter is dated after June 30, 1994, this extended reliance will apply only if so stated in the determination letter. Similar reliance applies to master and prototype or regional prototype plans if the plan sponsor requested a notification or opinion letter before April 1, 1991. Plan Must Qualify in Operation Generally, a plan qualifies in operation if it continues to satisfy the coverage and non- discrimination requirements and is main- rained according to the terms on which the favorable determination letter was issued. Changes in facts and other bases on whicY the determination letter was issued may mean that the determination letter may no longer be relied upon. Some examples of the effect of a plan's operatson on a favorable determina- tion are: Not meeting nondiscrimination In amount requirement. If the determination letter states that the plan satisfies the non- discrimination in amount requirement of section 1,401(a)(4)-1(b)(2) of the regula- tions on the basis of a design-based safe harbor, the plan will generally continue to satisfy this requirement in operation if the plan is maintained accordiqg to its terms. If the determination letter states that the plan satisfies the nondiscrimination in amount requirement on the basis of a nondesign- based safe harbor or a general test, and the plan subsequently fails to meet this requirement in operation, the letter may no longer be relied upon with respect to this requirement. Not meefing minimum coverage require- ments, If the determination letter does not include a statement regarding the minimum coverage requirements of Code section 410(b), this means that the plan satisfies these requirements by satisfying the ratio-percentage test. However, if the plan subsequently fails to satisfy the ratio- percentage test in operation, the letter may no longer be relied upon with respect to the coverage requirements. Likewise, if the determination letter states the plan satisfies the average benefit test, the letter may no longer be relied on with respect to the coverage requirements once the plan fails to satisfy the average benefit test in operation. Changes In testing methods. If the deter- mination letter is based in part on a demonstration that a coverage or nondis- crimination requirement is satisfied, and, in the operation of the plan, the method used to test that this requirement continues to be satisfied is changed (or is required to be changed because the facts have changed) from the method employed in the demon- stration, the letter may no longer be relied upon with respect to this requirement. Contributions or benefits in excess of the limitations under Code eection 415. A retirement plan may not provide retire- ment benefits or, in the case of a defined contribution plan, contributions and other additions, that exceed the limitations speci- fied in Internal Revenue Code section 415. Your plan contains provisions designed to Provide benefits within these limitations. Please become familiar with It,ese limita- tions for your ~lan will be disqualified if these limitations are exceeded. Top heavy minimums. If this plan primarily benefits employees who are highly compensated, if may be a top heavy plan and must provide certain minimum benefits and vesting for lower compensated employees. If your plan provides the accel- erated benefits and vesting only for years during which the plan is top heavy, failure to identify such years and to provide the accelerated vesting and benefits will disqualify the plan. Actual deferral percentage or contribu- tion percentage tests. If this plan provides for cash or deferred arrange- ments, employer matching contributions, or employee contributions, the determination letter does not consider whether special discrimination tests described in Code section 401 (k)(3) or 401(m)(2) have been satisfied in operation. However, the letter considers whether the terms of the plan satisfy the requirements specified in Code section 401(k)(3) or 401(m)(2). Reporting Requirements Most plan administrators or employers who maintain an employee benefit plan must file an annual return/report with the Internal Revenue Service, or, for years after 1998, with the Department of Labor. The following is a general discussion of the forms to be used for this purpose. See the instructions to each form for specific information: Form 5500-EZ, Annual Return of One- Participant (Owners and their Spouses) Pension Benefit Plane - generally for a "One-participant Plan', which is a plan that covers only: (1) an individual, or an individual and his or her spouse who wholly own a busi- ness, whether incorporated or not; or (2) partner(s) in a partnership or the parther(s) and the partner's spouse. If Form 5500-EZ cannot be used, the one-participant plan should use Form 5500-C/R, Return/Report of Employee Benefit Plan. Note. A 'one-participant" plan that has no more than $100,000 in assets at the end of the plan year is not required to file a return. However, Form 5500-EZ must be filed for any subsequent year in which plan assets exceed $100,000. (This amount may have increased after publication of this docu- ment.) If two or more one-participant plans have more than $100,000 in assets, a separate Form 5500-EZ must be filed for each plan. A =Final" Form 5500-EZ must be flied if the plan is terminated or if assets drop below $100,000 and you wish to stop filing Form ,~500, Annual Return/Report of Employee Benefit Plan - for a pension benefit plan with 100 or more participants at the beginning of the plan year. Form 5,~)0-C/R, Return/Report of Employee Benefit Plan - for each pension benefit plan with more than one but fewer than 100 participants at the beginning of the plan year. Form 5500-C/R takes the place of separate Forms 5500-C and 5500-R. Filing only the first two pages of Form 5500-C/R constitutes the filing of Form 5500-R for plan years for which Form 5500-C is not filed. Note. Keogh (H.R. 10) plans having over $100,000 in assets are required to file an annual return even if the only participants are owner-employees. The term 'owner- employee' includes a partner who owns more than 10% interest in either the capital or profits of the partnership. This applies to both defined contribution and defined benefit plans. When to file. Forms 5500 and 5500-EZ must be filed annually. Form 5500-C must be filed for (i) the initial plan year, (ii) the year a final return/report would be filed, and (iii) at three-year intervals. Form 5500- R (pages 1 and 2 of Form 5500-C/R) must be filed in the years when 5500-C is not filed. However, 5500-C will be accepted in place of 5500-R. Form 5330 for prohibited transactions - Transactions between a plan and someone having a relationship to the plan (disquali- fied person) are prohibited, unless specifi- cally exempted from this requirement. A few examples are loans, sales and exchanges of property, leasing of property, furnishing goods or services, and use of plan assets by the disqualified person. Disqualified persons who engage in a prohibited transaction for which there is no exception must file Form 5330 by the last day of the seventh month after the end of the tax year of the disqualified person. Form 5330 for tax on nondeductible employer contributions to qualified plane - If contributions are made to this plan in excess of the amount deductible, a tax is imposed upon the excess contribu- tion. Form 5330 must be filed by the last day of the seventh month after the end of the employer's tax year. Form 5330 for tax on excess contribu- tions to cash or deferred arrangements or excess employee contributions or employer matching contributions - If a plan includes a cash or deferred arrange- ment (Code sectson 401(k)) or provides for employee contributions or employer matching contributions (Code section 401(m)), then excess contributions that would cause the plan to fail the actual deferral percentage or the actual contribu- tion percentage test are subject to a tax unless the excess is eliminated within 2½ months after the end of the plan year. Form 5330 must be filed by the due date of the employer's tax return for the plan year in which the tax was incurred. Form 5330 for tax on mvemions of plan a~eeta - Under Code section 4980, a tax is payable on the amount of almost any employer reversion of plan assets. Form 5330 must be filed by the last day of the month following the month in which the reversion occurred. Form S310-A fo~ certain tmn~action$ - Under Code section 6058(b), an actuarial statement is required at least 30 days before a merger, consolidation, or transfers (including spin-offs) of asse~s to another plan. This statement is required for all plans. However, penalties for non-filing will not apply to defined contribution plans for which: (1) The sum of the account balances in each plan equals the lair market value of all plan assets, (2) The assets of each plan are combined to form the assets of the plan as merged, (3) Immediately after a merger, the account balance of each participant is equal to the sum of the account balances of the participant immediately before the merger, and (4) The plans must not have an unamortized waiver or unallocated suspense account. Penalties will also not apply if the assets transferred are less than three percent of the assets of the plan involved in the transfer (spinoff), and the transaction is not one of a series of two or more transfers (spinoff transactions) that are, in substance, one transaction. The purpose of the above discussions is to illustrate some of the principal filing requirements that apply to pension plans. This filing is not an exclusive listing of all returns and schedules that must be filed. Diaclosum. The Internal Revenue Service will process the returns and provide the Department of Labor and the Pension Benefit Guaranty Corporation with the necessary information and copies of the returns on microfilm for disclosure purposes. 1~11.l. lpg: 1111 ICMA I~ETIR. EM£NT COR. POR. ATION DECLARATION OF TRUST OF THE ICMA RETIREMENT TRUST DECLARATION OF TRUST OF ICMA RETIREMENT TRUST ARTICLE I. NAME AND DEFINITIONS Section 1.1 Name:The name of the trust created hereby is the ICMA IKetirement Trust. Section 1.2 Definitions:Wherever they are used herein, the following terms shall have the following respective meanings: (a) (b) By-laws. The by-laws referred to in Section 4.1 hereof, as amended from time to time: Deferred Compensation Plan. A deferred compensation plan estabhshed and maintained by a Public Employer for the purpose of providing retirement income and other deferred benefits to its employees in accordance with thc provision of section 457 of the Internal 1Kevenue Code. (c) Fanployees. Those employees who participate in Qualified Plans and/or Deferred Compema. don Pkms. (e) Employer Trnst. A trust created pursuant to an agreement between R.C and a Public Employer, or an agreement between I~C and a Public Employer for administrative services that is not a trust, in either case for the purpose of investing and administering the funds set aside by tach Employer in connection with its Deferred Compensation agreements with its employee~ in connection with its Qualified Plan. Investment Contract. A non-negotiable contract entered into by the R. etirement Trust with a financial institution that provides for a f fixed rate of return on investment. (t') ICMA. The International City/County Management Association. ICMA Trustees. Those Trustees elected by the Public Employers in accordance with the provisiom of Section 3.1 (a) hereof, who also members or former members of the Executive Board of ICMA. (h) RC Trustees. Those Trustees elected by thc Public Employers who, in accordance with the pmvisiom of Section 3.1 (a) hereof, ~rc members or former members of thc Board of Directors of (i) Internal R~venue Code. The Internal R~v- enue Code of 1986, as amended. MPP 04/30/2000 (J) 0,) (m) (n) (o) (p) (r) Inv~maent Adviser.The Investment Adviser that enters into a contract with the IKetarement Trust to provide adx~ce with respect to investment of the Trust Property. Portfolios. The separate commingled pools of in vestment established by the Investment Adviser to the l~etirement Trust, under the supervision of the Trustees, for the purpose of providing invest- menu for the Trust Property. Public Employee Trustees. Those Trustees elected by the Public Employers who, in accor dance with the provision of Section 3.1 (a) hereof, are full-time employees of Public Employers. Public Employer Trustees. Public Employers who serve as trustees of the Qualified P/ans or Deferred Compemation Plans. Public ~nployer. A unit of state or local government, or any agency or instrumentality thereof, that has adopted a Deferred Compensa- tion Plan or a Qualified Plan and has executed this Declaration of Trust. Qualified Plan. A plan that is sponsored by a Public Employer for the purpose of providing retirement income to its employees and that satisfies the qualification requirements of Section 401 of the Internal IKevenue Code. Public Ernployer Trust. A trust that is established by a Public Employer in connection with its Qualified Plan and that satisfies the requirements of Section 501 of the Internal R. evenue Code, or a Izust estabhshed byoa Public Employer in connection with its De- ferred Compensation Plan and that satisfies the requirements of Section 457(b) of the Internal IKevenue Code. Re. The International City Management Association R. efirement Corporation. Retirement Trust. The Trust created by this Declaration of Trust. Trust Property. The amounts held in the l~etirement Trust as provided in Section 2.3. The Trust Property shall include any income resulting from the investment to the amounts so held. Trustees. The Public Employee Trustees, ICMA Trustees and R.C Trustees elected by the Pubhc Employers to serve as members of the Board of Trustees of the g. etirement Trust. ARTICLE II. CREATION AND PURPOSE OF THE TRUST; OWNERSHIP OF TRUST PROPERTY Section 2.1 Creation: (a) The R.etirementTrnst was created by the execu- tion of this Declaration of Trust by the initial Trustees and Public Employers and is established with respect to each participating Public Employer by adoption of this Declaration of Trust. . The R. etirement Trust is hereby expressly made a part of the appropriate Qualified Plan or Deferred Compensation Plan of each Public Employer that executes or has executed this Declaration of Trust. Section 2.2 Purpose and Participation: The purpose of the R. etirement Trnst is to pro- vide for the commingled investment of funds held by the Pubhc Employers in connection with their Deferred Compensation and Qualified Plans.The Trust Property shall be invested in the Portfohos, in Investment Contracts, and in other investments recommended by the Investment Adviser under the supervision of the Board of Trustees. No part of the Trust Property will be invested in securities issued by Pubhc Employers. (b) Participation in the IKetirementTrnst is limited to M pension and profit-sharing trusts which are maintained by Pubhc Employers and that are ex- empt under section 501(a) of the Internal 1Kev- enue Code becanse the Q,alified Plans rehted thereto qualify under section 401(a) of the Inter- nal l~evenue Code and (ii) deferred compensa- tion phns maintained by Pubhc Employers under Section 457 of the Internal Revenue Code (and trusts maintained by such Pubhc Employers in con- nection with such 457 plans). Section 2.3 Ownership or'rust Property: (a) TheTrnstees shall have legal tide to theTrnst Prop- erty. The Trust Property shall be held as follows: (i) for the Pubhc EmployerTrustees for the ex- clusive benefit of the Employees; or in the case ora Deferred Compensation Plan maintained by a Pubhc Employer that has not established a Pubhc Employer Trust for the phn, for the Public Employer as beneficial owner of the plan's assets. (b) The portion of the corpus and income of the IKe- tirement Trust that equitably belongs to any Pub- hc EmployerTrust xr~/not be used for or di- verted to any purpose other than for the exclu- sive benefit of the Employees (or their beneficia- ties) who are entided to benefits under such Pub- lic Employer Trust. No employer's- Pubhc EmployerTrust may assign any part of its equity or interest in the l~etirement Trust, and any purported assignment ofsuch equity or interest shall be void. ARTICLE III. TRUSTEES Section 3.1 Number and Qunl;flcntion oFrrustees: The Board of Trustees shall consist ofnine Trustees. Five of the Trustees shall be full-time employees of a Public Employer (the Pubhc Employee Trustees) who are authorized by such Public Employer to serve ~s Trustee. The re- maining fourTrustees shall consist of two per- sons who, at the time of election to the Board of Trustees, are members or former members of the Executive Board oflCMA, and two persons who, at the time of election, are members or former members of the Board of Directors of I~C. One oftbe ICMATrnstees and one ofthe R.C Trustees shall, at the time of election, be full-time employees of Public Employers. (b) No person may serve as a Trustee for more than two terms in any ten-year period. Section 3.2 ~lection and Term: Except for the Trustees appointed to fill vacancies pursuant to Section 3.5 hereof, the Trustees shall be elected by a vote ora majority of the voting Pubhc Employers in accordance with the procedures set forth in the By-Laws. At the first election of Trustees, three Trustees shall be elected for a term of three years, three Trustees shall be elected for a term of two years and three Trustees shall be elected for a term of one year. At each subsequent election, three Trustees shall be elected each to serve for a term of three years and until his or her successor is elected and quahfied. Section 3.3 Nominations:The Trustees who are full-time employees of Public Employers shall serve as the Nominating Committee for the Pubhc Employee Trustees. The Nominating Committee shall choose candidates for Pubhc Employee Trustee in accordance with the procedures set forth in the By-Laws. Section 3.4 Resignation and Removal: AnyTrustee may resign as Trnstee (without need for prior or subsequent accounting) by In imtrument in writing signed by the Trustee and dehvered to the otherTrnstees and such MPP 03/31/2000 2 resignation shall be effective upon such delivery, or at a later date according to theterms of the imtrument. Any of the Trustees may be removed for cause, by a vote ora majority of the Public Employers. Co) Each Pubhc Employee Trustee shall resign his or her position as Trustee within sixty days of the date on which he or she ceases to be a full-time employee of a Pubhc Employer. Section 3,5 Vacancies: The term of office of a Trustee shall terminate and a vacancy shall occur in the event of his or her death, resignation, removal, adjudicated incompetence or other incapacity to perform the duties of the office of a Trustee. In the case of a vacancy, the remaining Trustees shall appoint such person as they in their discretion shall see fit (subject to the hmitatiom set forth in this Section), to serve for the unexpired portion of the term of the Trustee who has resigned or otherwise ceased to be a Trustee. The appointment shall be made by a written imtrument signed by a majority of the Trustees. The person appointed must be the same type oFTrustee (i.e., Public Employee Trustee, ICMA Trustee or I~C Trustee) as the person who has ceased to be a Trustee. An appointment ora Trustee may be made in anticipation of a vacancy to occur at a later date by reason of retirement or resignation, provided that such appointment shall not become effective prior to such retirement or resignation. Whenever a vacancy shall occur, until such vacancy is filled as provided in this Section 3.5, the Trustees in office, regardiess of their number, shall have all the powers granted to the Trustees and shall discharge all the duties imposed upon the Trustees by this Declaration. A written imtrument certifying the existence of a vacancy signed by a majority of the Trustees shall be conclu- sive evidence of the existence of such vacancy. Section 3.6 Trustees Serve in Representative Capacity: By executing this Declaration, each Public Employer agrees that the' Public Employee Trustees elected by the Public Employers are authorized to act as agents and representatives of the Public Employers collectively. ARTICLE IV. POWERS OF TRUSTEES Section 4.1 General Powers: TheTrustees s]~]] have the power to conduct the business of the Trust and to carry on its operations. Such power shall include, but shall not be limited to, the power to: receive the Trust Property fiom the Public Employers, Public Employer Trustees or the trustee or administrator under any Employer Trust; Co) enter into a contract with an Investment Adviser providing, among other things, for the establish- ment and operation of the Portfolios, selection of the Investment Contracts in which the Trust Property may be invested, selection of the other investments for the Trust Property and the payment ofreasonable fees to the Investment Adviser and to any sub-investment adviser retained by the Investment Adviser; (c) review annually the performance of the Investment Adviser and approve annually the contract with such Investment Adviser; (d) invest and reinvest the Trust Property in the Portfolios, the Investment Contracts and in any other investment recommended by the Invest- ment Adviser, but not including securities issued by Public Employers, provided that ifa Public Employer has directed that its monies be invested in one or more specified Portfolios or in an Investment Contract, the Trustees of the R. etirement Trust shall invest such monies'in accordance with such directions; keep such portion of the Trust Property in cash or cash balances as the Trustees, from time to time, may deem to be in the best interest of the ILefirement Trust created hereby without liability for interest thereon; accept and retain for such time as they may deem advisable any securities or other property received or acquired by them as Trustees hereunder, whether or not such securities or other pwperty would normally be purchased as investment hereunder; cause any securities or other property held as part of the Trust Property to be registered in the name of the ILetirement Trust or in the name of a nominee, and to hold any investments in bearer form, but the books and records of the Trustees shall at all times show that all such investments are a part of the Trust Property; make, execute, acknowledge, and deliver any and all documents of transfer and conveyance and any and all other instruments that may be necessary or appropriate to carry out the powers herein granted; (i) vote upon any stock, bonds, or other securities; give general or special proxies or powers of attorney withor without power of substitution; exercise any conversion privileges, subscription rights, or other options, and make any payments incidental thereto; oppose, or consent to, or otherwise participate in, corporate reorganiza- tions or to other changes affecting corporate securities, and delegate discretionary powers and pay any assessments or charges in connection therewith; and generally exercise any of the powers of an owner with respect to stocks, MPP 04/~0/2000 0) bonds, securities or other property held as part of the Trust Property; enter into contracts or arrangements for goods or services required in connection with the operation of the P--etirement Trust' including, but not hmited to, contracts with custodians and contracts for the provision of administrative services; borrow or raise money for the purposes of the R. etirement Trust in such amount, and upon such terms and conditions, as the Trustees shall deem advisable, provided that the aggregate amount of such bon'owings shall not exceed 30% of the value of the Trust Property. No person lending money to the Trustees shall be bound to see the application of the money lent or to inquire into its validity, expediency or propriety or any such borrowing; incur reasonable expemes as required for the operation of the R. etirement Trust and deduct suchexpenses tiom of the Trust Property; pay expenses properly allocable to the Trust Property incurred in connection with the Deferred Compensation Plans, Qualified Plans, or the Employer Trusts and deduct such expenses fi~m that portion of the Trust Prop- erty to which such expenses are properly allocable; pay out of the Trust Property all real and personal property taxes, income taxes and other taxes of any and all kinds which, in the opinion of the Trustees, are properly levied, or assessed under existing or furore laws upon, or in respect of, the Trust Property and allocate any such taxes to the appropriareaccounts; adopt, amend and repeal the By-laws, provided that such By-laws are at all times comistent with the terms of this Declaration of Trust; employ persons to make available interests in the R.etirement Trnst to employers eligible to maintain a Deferred Compensation Plan under Section 457 or a Qualified Plan under Section 401 of the Internal R~evenue Code; issue the Annual Report of the R. etirement Trust, and the disclosure documents and other literature used by the R. etirementTrust; in addition to conducting the investment program authorized in Section 4.1 (d), make loans, including the purchase of debt obliga- tions, provided that all such loans shall bear interest at the current market rate; contract for, and delegate any powers granted hereunder to, such officers, agents, employees, auditors and attorneys as the Trustees may select, provided that the Trustees may not delegate the powers set forth in paragraphs (b), (c) and (o) of thas Section 4.1 and may not delegate ,any powers if such delegation would violate their fiduciary duties; provide for the indemnification ofthe Ofiicers and Trustees ofthe l~etirement Trust and purchase fiduciary imurance; maintain books and records, including separate accounts for each Public Employer, Public Employer Trustee or EmployerTrnst and such additional separate accounts as are required under, and consistent with, the Deferred Compensation or Qualified Plan of each Public Employer; and do all such acts, take all such proceedings, and exercise all such rights and privileges, although not speci~cally mentioned herein, as the Trustees may deem necessary or appropriate to administer the Trust Property and to carry out the purposes of the l~.etirement Trust. Section 4.2 Distribution of Trust Property: Distri- butions of the Trust property shall be made to, or on behalf of, the Public Employer or Public Employer --' Trustee, in accordance with the terms of the Deferred Compensation Plato, Qualified Plans or Employer Trusts. The Trustees of the l~etirement Trust shall be fully protected in making payments in accordance with the directions of the Public Employers, Public Employer Trustees or trustees or administrators of any Employer Trust without ascertaining whether such payments are in compli- ance with the provisions of the applicable Deferred Compensation or Q-:lified Plan or EmployerTrust. - Section 4.3 F. xecution of l. nstruments:TheTrustees may unanimously designate any one or more of the Trustees to execute any instrument or document on behalf of all, including but not limited to the signing or endorsement of any check and the signing of any applications, imurance and other contracts, and the action of such designated Trustee or Trustees shall ~ have the same force and effect as if taken by all the Trustees. ARTICLE Vo DUTY OF CARE AND LIABILITY OF TRUSTEES Section 5.1 Duty of Care: In ex~rcising the powers hereinbefore granted to theTrnstees, the Trustees shall perform all acts within their authority for the exclusive purpose ofproviding benefits for the Public Employers in connection with non-trusted MPP 05/$112OOO 4 Deferred Compensation Plato and for the Public Employer Trustees, and shzl/perform such acts with the care, skill, prudence and ddigence in the circum- stances then prevailing that a prudent person acting in a like capacity and familiar with such matters would use in the conduct o£an enterprise o£a like character and with like aims. Section 5.2 Liability:TheTrustees shall not be hable for any mistake of judgment or other action taken in good faith, and for any action taken or omitted in reliance in good faith upon the books of account or other records of the tLetirement Trust, upon the opinion of counsel, or upon reports made to the R. etirement Trust by any of its officers, employ- ecs or agents or by the Investment Adviser or any sub-investment adviser, accountant, ap- praiser or other expert or consultant selected with reasonable care by the Trustees, officers or employees of the tLetirementTrust. The Trustees shal/~lso not be liable for any loss sustained by the Trust Property by reason of any investment made in good faith and in accordance with the standard of care set forth in Section 5.1. Section 5.3 Bond: No Trustee shall be obligated to give any bond or other security for the performance of any of his or her duties hereunder. ARTICLE VI. ANNUAL REPORT TO SHAREHOLDERS The Trustees shall annually submit to the Public Employ- ers and Public Employer Trustees a written report of the transactions of the tLetirement Trust, including financial statements which shall be certified by independent public accountants chosen by the Trustees. Upon termination, all of the Tru,t paid out to the Public Erm~lovers ,,., ~,,crty - -- ,, utnfc Empl~'er Trustees or the trustees or administrat,ts of the Employer Trusts, as appropriate, Section 7.3 Amendment:The ILetircme,t Trust may be amended by the vote ora maj,rity '~f the Public Employers, each casting one v~te. Section 7.4 Procedure:A resoluticm t, terminate or amend the R. etirement Trust or u, rem,~ve aTrustee shall be submitted to a vote of the I'ubhc Employers if.' (i) a majority of the Trustees u~ &reel, or; (ii) a petition requesting a vote signed by ,,a, less than 25 percent of the Public Employer% is sal,mtted to the Trustees. ARTICLE VIII. MISCELLANEOUS Section 8.1 Governing Law: Except as ~aherwise required by state or local hw, thi~ Decl~tion of Trust and the R. etirement Trust hereby, ~eated shall be construed and regulated by thc law~ ~-' - District of Columbia. , mc Section 8.2 Counterparts:This D¢, larati,~n may be executed by the Public Emph~ycr~ a,d'l~ustees in two or more counterparts, each ~'f wl,~h ,.hall be deemed an original but all of wi,ch u,i,~ther shall constitute one and the same imtrumem, ARTICLE VIII. DURATION OR AMENDMENT OF RETIREMENT TRUST Section 7.1 Withdrawal:A Public Employer or Public Employer Trustee may, at any time. withc[raw from this Retirement Trust by delivering to the Board of Trustees a written statement of withdrawal. In such statement, the Public Employer or Public Employer Trustee shall acknowledge that the Trust Property allocable to the Public Employer is derived from compensation deferred by employees of such Public Employer pursuant to its Deferred Compensation Plan or from contributions to the accounts of Employees pursuant to a Qualified Plan, and shall designate the financial imtitution to which such property shall be transferred by the Trustees of the R. etirement Trust or by the trustee or administrator ,ruder an EmployerTrust. Section 7.2 Duration:The 1LetirementTrust shall continue until terminated by the vote ora majority of the Public Employers, each casting one vote. MPP 04/30/2000 S [lTV OF DELRI:I¥ BEfl[H CiTY ATTORNEY'S OFFICE 200 NW 1st AVENUE · DELRAY BEACH, FLORIDA 33444 TELEPHONE 561/243-7090 ° FACSIMILE 561/278-4755 DELRAY BEACH ~lI.Amedca C~ 1993 DATE: July 17, 2000 MEMORANDUM Writer's D~rect Line 561/243-7091 TO: City Commission David Harden, City Manager FROM: Susan A. Ruby, City Attorney SUBJECT: Resolution (Money Purchase Plan or Trust) The City adopted Resolution 17-97 in 1997 establishing and implementing a Money Purchase Plan/Trust (40lA) Plan. We have received information that due to changes in the law, certain nondiscrimination tests are not now required for public sector plans. Therefore, we need to adopt the restated Model Plan set forth in Exhibit C to this Resolution 51-00. Further, in addition to adopting the new restated plan we need to adopt the modified adoption agreement, which also modifies the eligibility list of participating employees as set forth in Exhibit A and B thereto. Our office requests that this Resolution be placed on the City Commission July 25, 2000 agenda for approval. Please call if you have any questions. Cc: Joe Safford, Finance Director Milena Walinski, Assistant Finance Director Sherry Muehlberg, Administrative Manager Alison MacGregor Harry, City Clerk