Res 05-07
('
RESOLUTION NO. 5-07
A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF
DELRA Y BEACH, FLORIDA, ADOPTING THE AMENDED AND
RESTA 1ED PLAN AND TRUST DOCUMENT FOR THE ICMA
RETIREMENT CORPORATION PLAN NO. 30-1207, SECTION 457
DEFERRED COMPENSATION PLAN AS AMENDED HEREIN BY
REJECTING CERTAIN ELECTIONS, TO BE EFFECTIVE
FEBRUARY 1, 2007; PROVIDING THAT THE ASSETS OF THE PLAN
SHALL BE HELD IN TRUST FOR THE EXCLUSIVE BENEFIT OF
PLAN PARTICIPANTS AND THEIR BENEFICIARIES; PROVIDING
AN EFFECTIVE DATE.
WHEREAS, the City of Dekay Beach has previously established and maintains a deferred
compensation plan for certain of its employees which is administered by the ICMA Retirement
Corporation ICMA-RC); and,
WHEREAS, the City's deferred compensation plan benefits the City and its employees by
providing reasonable retirement security for employees and increased flexibility in the City's
personnel management system, and by assisting in the attraction and retention of competent
personnel; and,
WHEREAS, the ICMA-RC is using a negative election process wherein no notification is
necessary to ICMA-RC to take advantage of some changes in the law; and,
WHEREAS, however, the City for its own record keeping seeks to adopt this resolution
which adopts the amended and restated plan stating its elections; and,
WHEREAS, amendments to the U.S. Internal Revenue Code have been enacted that require
changes to the structure of and allow enhancements of the benefits of the deferred compensation
plan.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF
THE CITY OF DELRA Y BEACH, FLORIDA, AS FOLLOWS:
Section 1. That the City hereby amends and adopts the restated ICMA Retirement
Corporation Deferred Compensation Plan and Trust (the "Plan "), attached hereto and made a part
hereof as Appendix "A" as amended by elections set forth below.
Section 2.
That the Plan shall not permit loans to participants.
Section 3.
That the Plan shall not permit in-service distributions of rollover assets.
Section 4.
That the Plan shall not permit age 70 Yz in-service distributions.
Section 5. That the assets of the Plan shall be held in trust, with the City serving as
Trustee, for the exclusive benefit of the Plan participants and their beneficiaries, and the assets shall
not be diverted to any other purpose. The City hereby agrees to serve as trustee under the Plan.
The Trustee's beneficial ownership of Plan assets held in the Vantage Trust shall be held for the
further exclusive benefit of the Plan participants and their beneficiaries.
PASSED AND ADOPTED in regular session on this the ~ of February, 2007.
~ZR~
ATTEST:
~S>. ~~~~
City Clerk
2
RES. NO. 5-07
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[IT' DF DELHA' BEA[H
CITY ATTORNEY'S OFFICE
2()() NW 1st AVENUE' DEl.RAY BEACH. FLORIDA 33444
TELEPHONE: 56112-13-7()l)()' FACSIMILE: 561/278-4755
Writer's Direct Line: 561/243-7091
DElRAY BEACH
F L 0 Ii: IDA
D.8d
AII.America City
" III! DATE:
1993 TO:
2001
MEMORANDUM
January 12, 2007
FROM:
City Commission
David Harden, City Manager ~ il
Susan A. Ruby, City Attorney({}'1L
ICMA Retirement Plan Adoption with Certain Elections
SUBJECT:
Resolutions 5-07 and 6-07 adopt the ICMA 457 and 401A retirement plans with
certain elections.
Resolution 5-07/ICMA 457
The ICMA 457 plan gives the City certain choices on two new elections. (The City
previously has rejected loans as an option) The two new elections allow in-service
distributions of rollover assets and in-service distributions at age 70 1/2 or older.
The resolution, as drafted, rejects these elections.
Resolution 6-07/ICMA 401A Plan
The ICMA 401A plan has the above two elections as well as two additional ones.
The resolution, as drafted, rejects in-service distributions at 70 % and prohibits in-
service rollover distributions. The resolution does elect and allow for pre-tax
health care benefit contributions to be an integral part of the trust because the City
has certain health savings accounts. The resolution includes a rejection of an
election to change notice requirements to a spouse when changing beneficiaries
to a non-spouse. I am including a chart that helps to further explain the elections.
Please place Resolutions 5-07 and 6-07 on the February 6, 2007 City Commission
agenda.
SAR:
Attachments
cc: Chevelle Nubin, City Clerk
Joe Safford, Finance Director
Bruce Koeser, Human Resources Director
James W. Linn, Esq.
~.q
ATTACHMENT A2
OVERVIEW OF THE 401 MONEY PURCHASE AND PROFIT SHARING
PLAN DOCUMENT CHANGES
As your 401 qualified retirement plan provider, ICMA-RC will take care of most additional administrative tasks associated
with the plan document changes. Your Client Services Team is available at 1-800-326-7272 to answer any questions you may have.
1. In-Service Distributions Not available. Added the ability for the employer MPP: Section 9.08 Allows plan Complete the Adoption
- Age 70 Y2 to offer in-service distributions for sponsors Agreement Amendment
participants age 70 ~ or older. to provide (Attachment 82*)
This provision!! the default PSP: Section 9.08 participants if you do not wish
option. If you do not wish with expanded to offer in-service
to offer this option, you will distribution distributions to
need to indicate UNo" in options. participants who ore
Section II of Attachment 82* age 70 ~ or older.
(p.8).
2. In-Service Distributions Not ovailable. Added the ability for the employer MPP: Section 9.07 Allows plan Complete the Adoption
- Rollover Assets to offer in-service distributions sponsors Agreement Amendment
for rolled-in amounts. This to provide (Attachment 82*) if
provision is not the default PSP: Section 9.09 participants you wish to offer in-
option. If you wish to offer with expanded service distributions of
this option, you will need to distribution rollover assets.
indicate "Yes" in Section III options.
of Attachment 82* (p.8).
3. Definition 01 Earnings Earnings and The definition of earnings MPP: Section 2.09 Provides Confirm that your
compensation did shall now include any pre-tax higher 401 (a) systems include
not include pre-tax contributions to an integral part contribution employee pre-tax
contributions to an trust (excluding direct employer PSP: Section 2.10 opportunities to health care benefit
integral part trust of contributions) of the Employer participants. contributions
the Employer providing providing retiree health care (excluding
retiree health care benefits. This change to the direct employer
benefits. earnings definition!! the contributions) to an
default option. If you do not integral part trust as
wish to change your plan's port of an employee's
definition of earnings, you gross income when
will need to inlKate UNo" in calculating plan
Section V of Attachment 82* contributions.
(p.8).
MPP = Money Purchase Plan
PSP = Profit Sharing Plan
* Employers who are amending an individually designed plan document to include any of the optional
provisions now available win need to complete the appropriate sections of Attachment C2 (p. 12).
3
"
"
ATTACHMENT A2 (Coni.)
OVERVIEW OF THE 401 MONEY PURCHASE AND PROFIT SHARING
PLAN DOCUMENT CHANGES
As your 401 qualified retirement plan provider, ICMA-RC will take care of most additional administrative tasks associated
with the plan document changes. Your Client Services Team is available at 1-800-326-7272 to answer any questions you may have.
4. New
HSpousol
Protection
OptionsH
MPP: Qualified Joint
and Survivor Annuity
(QJSA) was mandatory
for ICMA-RC Money
Purchase Pension Plans.
Under the QJSA, the
participant receives an
annuity in the form
of a guaranteed level
monthly payment for
as long as he/she lives.
If the spouse survives
the participant, he/she
will receive monthly
payments equal to
at least 50% of the
participant's payments.
PSP: The Beneficiary
Spousal Consent Election
(explained in the "New
Provision" column to
the right) is already the
default option for
IeMA-RC's 401 Profit
Sharing Plans.
MPP = Money Purchase Plan
The 401 (a) plan documents will now allow the
following Spousal Protection Options:
· Beneficiary Spousal (onsent
Election - This provision is the
default option for 401 MPPs.
Under this option, participants may
elect any of the available distribution
options without spousal cansent.
However, married participants will
still be required to receive spousal
consent if they wish to name
someone other than their spouse as
the beneficiary of the account.
QJSA Election -If selected, the
normal form of payment of benefits
under the Plan is a qualified joint
and survivor annuity (QJSA) with
the participant's spouse (or life
annuity, if the participant is single).
The annuity option can be waived
with the consent of the spouse, and
another distribution option can then
be selected. Married participants are
required to receive spousal consent
if they wish to name someone other
than their spouse as the beneficiary
of the account.
· Participant Directed Election -If
selected, participants may elect any
of the available distribution options
without spousal consent. Participants
can name any person(s) as the
beneficiary(ies) of the Plan, without
spousal consent.
PSP = Profit Sharing Plan
MPP:
Section 2.04
Section 17
The QJSA option
is rarely used by
participants, and
the additional
paperwork
required to waive
the QJSA option
when requesting
a withdrawal
often results
in unnecessary
processing delays.
Complete the
Adoption Agreement
Amendment
(Attachment B 2* on
p.B) if you wish to
continue using the
QJSA election.
PSP:
Section 2.04
Section 17
* Employers who are amending an individually designed plan document to include any of the optional
provisions now available will need to complete the appropriate sections of Attachment C2 (p. 12).
4
ATTACHMENT A2 (Cont.)
OVERVIEW OF THE 401 MONEY PURCHASE AND PROFIT SHARING
PLAN DOCUMENT CHANGES
As your 401 qualified retirement plan provider, ICMA-RC will take care of most additional administrative tasks associated
with the plan document changes. Your Client Services Team is available at 1-800-326-7272 to answer any questions you may have.
,.' .......I(IA4.~~,Pla~ :'..E~pl~!~r'.>.
Old New .
Item Provision Provision Document Purpose Administrative
Reference ,"Actions >
S. Plan-to-Plan This change was Added language that provides for plan-to-plan MPP: Section 9.03(a) Clarificotion. None onticipated.
Transfers introduced with transfers for the non-forfeitable interest of a
EGTRRA but did not participant's account made for the purchase PSP: Section 9.03(a)
specifically name of service credit in defined benefit plans
transfers for the maintained by the Employer.
purchase of service
credits in the "Transfer
to Another Plan"
section.
6. Portability of This change was Added Portability of Benefits language. This MPP: Section 4.09 Incorporates None anticipated.
Benefits introduced with allows the plan sponsor to elect to allow roll-ins EGTRRAlanguage
EGTRRA. from all eligible plans, including 401 (a), 403(b), into the model
457(b), etc. This was introduced to sponsors PSP: Section 4.10 plan documents.
as part of the EGTRRA rollout in 2001. This
provision is the default and will be offered unless
the employer elects otherwise in the adoption
agreement.
7. De Minimis This change was Updated the plan document to reflect the MPP: Section 9.04 Clarification. None anticipated.
Withdrawals originally introduced following de minimis language. On or after Incorporates new
with EGTRRA. January 1, 2002, if a Participant terminates PSP: Section 9.04 language into
service, and the value of his/her non-forfeitable the model plan
interest in his/her account is less than 51,000, documents.
the participant's benefit shall be paid os soon
as practicable to the participant in a single lump
sum distribution. If the value of the participant's
account is at least 51,000 but not more than the
dollar limit under section 411(a) (l1)(A) ofthe
Code (currently 55,000), the participant may
elect to receive his/her non-forfeitable interest in
his/her account.
8. Loans The plan document did Added language: U ...unless waived by the MPP: Section Clarification. None anticipated.
not specify the interest participant, any plan loan that is outstanding on 13.02(k)
- Military rate at which loans the date that active duty military service begins
Provision would accrue when will accrue interest at a rate of no more than 6% PSP: Section
a participant enters durinq the period of military service... " 13.02(k)
active military duty.
5
MPP = Money Purchase Plan
PSP = Profit Sharing Plan
RESOLUTION NO. 5-07
A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF
DELRAY BEACH, FLORIDA, ADOPTING THE AMENDED AND
RESTATED PLAN AND TRUST DOCUMENT FOR THE ICMA
RETIREMENT CORPORATION PLAN NO. 30-1207, SECTION 457
DEFERRED COMPENSATION PLAN AS AMENDED HEREIN BY
REJECTING CERTAIN ELECTIONS, TO BE EFFECTNE
FEBRUARY I, 2007; PROVIDING THAT THE ASSETS OF THE
PLAN SHALL BE HELD IN TRUST FOR THE EXCLUSIVE BENEFIT
OF PLAN PARTICIPANTS AND THEIR BENEFICIARIES;
PROVIDING AN EFFECTNE DATE.
WHEREAS, the City of Delray Beach has previously established and maintains a deferred
compensation plan for certain of its employees which is administered by the ICMA Retirement Corporation
ICMA-RC); and,
WHEREAS, the City's deferred compensation plan benefits the City and its employees by providing
reasonable retirement security for employees and increased flexibility in the City's personnel management
system, and by assisting in the attraction and retention of competent personnel; and,
WHEREAS, the ICMA-RC is using a negative election process wherein no notification is necessary
to ICMA-RC to take advantage of some changes in the law; and,
WHEREAS, however, the City for its own record keeping seeks to adopt this resolution which
adopts the amended and restated plan stating its elections; and,
WHEREAS, amendments to the U.S. Internal Revenue Code have been enacted that require
changes to the structure of and allow enhancements of the benefits of the deferred compensation plan.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY
OF DELRA Y BEACH, FLORIDA, AS FOLLOWS:
Section 1. That the City hereby amends and adopts the restated ICMA Retirement Corporation
Deferred Compensation Plan and Trust (the "Plan"), attached hereto and made a part hereof as Appendix
"A" as amended by elections set forth below.
Section 2.
That the Plan shall not permit loans to participants.
Section 3.
That the Plan shall not permit in-service distributions of rollover assets.
Section 4.
That the Plan shall not permit age 70 Y:z in-service distributions.
Section 5. That the assets of the Plan shall be held in trust, with the City serving as Trustee, for
the exclusive benefit of the Plan participants and their beneficiaries, and the assets shall not be diverted to
any other purpose. The City hereby agrees to serve as trustee under the Plan. The Trustee's beneficial
ownership of Plan assets held in the Vantage Trust shall be held for the further exclusive benefit ofthe Plan
participants and their beneficiaries.
PASSED AND ADOPTED in regular session on this the _ day of January, 2007.
MAYOR
ATTEST:
City Clerk
2
RES. NO. 5-07
ICMARC
Building Retirement Security
DEFERRED COMPENSATION PLAN AND TRUST
As Amended and Restated Effective January 1, 2006
Article I. Purpose
The Employer hereby establishes and maintains the Employer's Deferred Compensation Plan and Trust, hereafter referred to as
the "Plan." The Plan consists of the provisions set forth in this document.
The primary purpose of this Plan is to provide retirement income and other deferred benefits to the Employees of the
Employer and the Employees' Beneficiaries in accordance with the provisions of Section 457 of the Internal Revenue Code of
1986, as amended (the "Code").
This Plan shall be an agreement solely between the Employer and participating Employees. The Plan and Trust forming a
part hereof are established and shall be maintained for the exclusive benefit of Participants and their Beneficiaries. 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 Participants and their Beneficiaries.
Article II. Definitions
2.01 Account. The bookkeeping account maintained for each Participant reflecting the cumulative amount of the
Participant's Deferred Compensation, including any income, gains, losses, or increases or decreases in market
value attributable to the Employer's investment of the Participant's Deferred Compensation, and further reflecting
any distributions to the Participant or the Participant's Beneficiary and any fees or expenses charged against such
Participant's Deferred Compensation.
2.02 Accounting Date. Each business day that the New York Stock Exchange is open for trading, as provided in Section
6.06 for valuing the Trust's assets.
2.03 Administrator. The person or persons named in writing to carry out certain nondiscretionary administrative
functions under the Plan, as hereinafter described. The Employer may remove any person as Administrator upon
75 days' advance notice in writing to such person, in which case the Employer shall name another person or persons
to act as Administrator. The Administrator may resign upon 75 days' advance notice in writing to the Employer, in
which case the Employer shall name another person or persons to act as Administrator.
2.04 Automatic Distribution Date. April 1 of the calendar year after the Plan Year the Participant attains age 70-1/2
or, if later, has a Severance Event.
2.05 Beneficiary. The person or persons designated by the Participant in his or her Joinder Agreement who shall receive
any benefits payable hereunder in the event of the Participant's death. In the event that the Participant names two
or more Beneficiaries, each Beneficiary shall be entitled to equal shares of the benefits payable at the Participant's
death, unless otherwise provided in the Participant's Joinder Agreement. If no beneficiary is designated in the Joinder
Agreement, if the Designated Beneficiary predeceases the Participant, or if the designated Beneficiary does not
survive the Participant for a period of fifteen (15) days, then the estate of the Participant shall be the Beneficiary. If a
married Participant resides in a community or marital property state, the Participant shall be responsible for obtaining
appropriate consent of his or her spouse in the event the Participant designates someone other than his or her spouse
as Beneficiary. The preceding sentence shall not apply with respect to a Deemed IRA under Article IX.
2.06 Deemed IRA. A separate account or annuity established under the Plan that complies with the requirements of
Section 408(q) of the Code, the Income Tax Regulations thereunder, and any other IRS guidance.
, which is a political subdivision, agency or instrumentality
, described in Section 457(e)(I)(A) of the
2.07 Deferred Compensation. The amount of Includible Compensation otherwise payable to the Participant which
the Participant and the Employer mutually agree to defer hereunder, any amount credited to a Participant's Account
by reason of a transfer under Section 6.09 or 6.10, a rollover under Section 6.11, or any other amount which the
Employer agrees to credit to a Participant's Account.
2.08 Dollar Limitation. The applicable dollar amount within the meaning of Section 457(b)(2)(A) of the Code, as
adjusted for the cost-of-living in accordance with Section 457(e)(15) of the Code.
2.09 Employee. Any individual who provides services for the Employer, whether as an employee of the Employer or as an
independent contractor, and who has been designated by the Employer as eligible to participate in the Plan.
2.10 Employer.
of the [State/Commonwealth] of
Code.
2.11 457 Catch-Up Dollar Limitation. Twice the Dollar Limitation.
2.12 Includible Compensation. Includible Compensation of a Participant means "compensation," as defined in Section
415(c)(3) of the Code, for services performed for the Employer. Includible Compensation shall be determined without
regard to any community property laws. For purposes of a Participant's Joinder Agreement only and not for purposes
of the limitations in Article V, Includible Compensation shall include any employer contributions to an integral part
trust of the employer providing retiree health care benefits.
2.13 Joinder Agreement. An agreement entered into between an Employee and the Employer, including any
amendments or modifications thereof. Such agreement shall fix the amount of Deferred Compensation, specify a
preference among the investment alternatives designated by the Employer, designate the Employee's Beneficiary or
Beneficiaries, and incorporate the terms, conditions, and provisions of the Plan by reference.
2.14 Normal Limitation. The maximum amount of Deferred Compensation for any Participant for any taxable year
(other than amounts referred to in Sections 6.09, 6.10, and 6.11).
2.15 Normal Retirement Age. Age 70-1/2, unless the Participant has elected an alternate Normal Retirement Age by
written instrument delivered to the Administrator prior to a Severance Event. A Participant's Normal Retirement Age
determines the period during which a Participant may utilize the 457 Catch-Up Dollar Limitation of Section 5.02(b)
hereunder. Once a Participant has to any extent utilized the catch-up limitation of Section 5.02(b), his Normal
Retirement Age may not be changed.
A Participant's alternate Normal Retirement Age may not be earlier than the earliest date that the Participant will
become eligible to retire and receive immediate, unreduced retirement benefits under the Employer's basic defined
benefit retirement plan covering the Participant (or a money purchase pension plan in which the Participant also
participates if the Participant is not eligible to participate in a defined benefit plan), and may not be later than the
date the Participant will attain age 70-1/2. If the Participant will not become eligible to receive benefits under a basic
defined benefit retirement plan (or money purchase pension plan, if applicable) maintained by the Employer, the
Participant's alternate Normal Retirement Age may not be earlier than 65 and may not be later than age 70-112. In
no event may a Participant's normal retirement age be different than the normal retirement age under the Employer's
other 457(b) plans, if any.
In the event the Plan has Participants that include qualified police or firefighters (as defined under Section
415(b)(2)(H)(ii)(I) of the Code), a normal retirement age may be designated for such qualified police or firefighters
that is not earlier than age 40 or later than age 70-1/2. Alternatively, qualified police or firefighters may be permitted
to designate a normal retirement age that is between age 40 and age 70-1/2.
2
2.16.. Participant. Any Employee who has joined the Plan pursuant to the requirements of Article IV: For purposes of
section 6.11 of the Plan, the term Participant includes an employee or former Employee of the Employer who has not
yet received all of the payments of benefits to which hel she is entitled under the Plan.
2.17 Percentage Limitation. 100 percent of the participant's Includible Compensation available to be contributed as
Deferred Compensation for the taxable year.
2.18 Plan Year. The calendar year.
2.19 Retirement. The first date upon which both of the following shall have occurred with respect to a participant:
Severance Event and attainment of age 65.
2.20 Severance Event. A severance of the Participant's employment with the Employer within the meaning of Section
457(d)(1)(A)(ii) of the Code.
In general, a Participant shall be deemed to have experienced a Severance Event for purposes of this Plan when, in
accordance with the established practices of the Employer, the employment relationship is considered to have actually
terminated. In the case of a Participant who is an independent contractor of the Employer, a Severance Event shall be
deemed to have occurred when the Participant's contract under which services are performed has completely expired
and terminated, there is no foreseeable possibility that the Employer will renew the contract or enter into a new
contract for the Participant's services, and it is not anticipated that the Participant will become an Employee of the
Employer, or such other events as may be permitted under the Code.
2.21 Trust. The Trust created under Article VI of the Plan which shall consist of all compensation deferred under the Plan,
plus any income and gains thereon, less any losses, expenses and distributions to Participants and Beneficiaries.
Article III. Administration
3.01 Duties of the Employer. The Employer shall have the authority to make all discretionary decisions affecting the
rights or benefits of Participants which may be required in the administration of this Plan. The Employer's decisions
shall be afforded the maximum deference permitted by applicable law.
3.02 Duties of Administrator. The Administrator, as agent for the Employer, shall perform nondiscretionary
administrative functions in connection with the Plan, including the maintenance of Participants' Accounts, the
provision of periodic reports of the status of each Account, and the disbursement of benefits on behalf of the Employer
in accordance with the provisions of this Plan.
Article IV: Participation in the Plan
4.01 Initial Participation. An Employee may become a Participant by entering into a Joinder Agreement prior to the
beginning of the calendar month in which the Joinder Agreement is to become effective to defer compensation not
yet earned, or such other date as may be permitted under the Code. A new employee may defer compensation in the
calendar month during which he or she first becomes an employee if a Joinder Agreement is entered into on or before
the first day on which the employee performs services for the Employer.
4.02 Amendment of Joinder Agreement. A Participant may amend an executed Joinder Agreement to change the
amount of Includible Compensation not yet earned which is to be deferred (including the reduction of such future
deferrals to zero). Such amendment shall become effective as of the beginning of the calendar month commencing
after the date the amendment is executed, or such other date as may be permitted under the Code. A Participant may
at any time amend his or her Joinder Agreement to change the designated Beneficiary, and such amendment shall
become effective immediately.
3
Article ~ Limitations on Deferrals
5.01 Normal Limitation. Except as provided in Section 5.02, the maximum amount of Deferred Compensation for any
Participant for any taxable year, shall not exceed the lesser of the Dollar Limitation or the Percentage Limitation.
5.02 Catch-Up Limitations.
(a) Catch-up Contributions for Participants Age 50 and Over: A Participant who has attained the age of 50 before
the close of the Plan Year, and with respect to whom no other elective deferrals may be made to the Plan for
the Plan Year by reason of the Normal Limitation of Section 5.01, may enter into a Joinder Agreement to
make elective deferrals in addition to those permitted by the Normal Limitation in an amount not to exceed
the lesser of:
(1) The applicable dollar amount as defined in Section 414(v)(2)(B) of the Code, as adjusted for the cost-
of-living in accordance with Section 414(v)(2)(C) of the Code; or
(2) The excess (if any) of
(i) The Participant's Includible Compensation for the year, or
(ii) Any other elective deferrals of the Participant for such year which are made without regard to
this Section 5.02(a).
An additional contribution made pursuant to this Section 5.02(a) shall not, with respect to the year in which
the contribution is made, be subject to any otherwise applicable limitation contained in Section 5.01 above,
or be taken into account in applying such limitation to other contributions or benefits under the Plan or any
other plan. This Section 5.02(a) shall not apply in any year to which a higher limit under Section 5.02(b)
applies.
(b) Last Three rears Catch-up Contribution: For each of the last three (3) taxable years for a Participant ending
before his or her attainment of Normal Retirement Age, the maximum amount of Deferred Compensation
shall be the lesser of:
(1) The 457 Catch-Up Dollar Limitation, or
(2) The sum of
(i) The Normal Limitation for the taxable year, and
(ii) The Normal Limitation for each prior taxable year of the Participant commencing after 1978
less the amount of the Participant's Deferred Compensation for such prior taxable years. A
prior taxable year shall be taken into account under the preceding sentence only if (x) the
Participant was eligible to participate in the Plan for such year, and (y) compensation (if any)
deferred under the Plan (or such other plan) was subject to the Normal Limitation.
5.03 Sick, Vacation and Back Pay. If the Employer so elects, a Participant may defer all or a portion of the value of the
Participant's accumulated sick pay, accumulated vacation pay and/or back pay, provided that such deferral does not
cause total deferrals on behalf of the Participant to exceed the Dollar Limitation or Percentage Limitation (including
any Catch-up Dollar Limitation) for the year of deferral. The election to defer such sick, vacation and/or back pay
must be made in a manner and at a time permitted under Section 1.457 -4(d) of the Income Tax Regulations.
Pursuant to proposed IRS regulations issued under Section 415 of the Code, the Plan may permit deferrals from
compensation, including sick, vacation and back pay, so long as the amounts are paid within 2 Y2 months following
severance from employment and the other requirements of Sections 457(b) and 415 of the Code are met. Additionally,
4
, the agreement to defer such amounts must be entered into prior to the first day of the month in which the amounts
otherwise would be paid or made available.
5.04 Other Plans. Notwithstanding any provision of the Plan to the contrary, the amount excludible from a Participant's
gross income under this Plan or any other eligible deferred compensation plan under Section 457(b) of the Code shall
not exceed the limits set forth in Sections 457(b) and 414(v) of the Code.
5.05 Excess Deferrals. Any amount that exceeds the maximum Dollar Limitation or Percentage Limitation (including
any applicable Catch-Up Dollar Limitation) for a taxable year, shall constitute an excess deferral for that taxable year.
Any excess deferral shall be distributed in accordance with the requirements for excess deferrals under the Code and
Section 1.457-4(e) of the Income Tax Regulations or other applicable Internal Revenue Service guidance.
5.06 Protection of Person Who Serves in a Uniformed Service. An Employee whose employment is interrupted by
qualified military service under Section 414( u) of the Code or who is on leave of absence for qualified military service
under Section 414( u) of the Code may elect to contribute additional Deferred Compensation upon resumption of
employment with the Employer equal to the maximum Deferred Compensation that the Employee could have elected
during that period if the Employee's employment with the Employer had continued (at the same level of Includible
Compensation) without the interruption or leave, reduced by Deferred Compensation, if any, actually made for the
Employee during the period of the interruption or leave. This right applies for five years following the resumption of
employment (or, if sooner, for a period equal to three times the period of the interruption or leave).
Article VI. Trust and Investment of Accounts
6.01 Investment of Deferred Compensation. A Trust is hereby created to hold all the assets of the Plan (except
Deemed IRA contributions and earnings thereon held pursuant to Article IX) 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 that agrees to act in that capacity hereunder.
6.02 Investment Powers. The trustee or the Administrator, acting as agent for the trustee, shall have the powers listed
in this Section with respect to investment of Trust assets, except to the extent that the investment of Trust assets is
directed by Participants, pursuant to Section 6.05 or to the extent that such powers are restricted by applicable law.
(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 reasonable 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.
(b) 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 described under
Sections 457 or 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 Plans the declaration of
trust of such commonly collective, or commingled trust fund shall constitute a part of this Plan.
(c) To invest and reinvest all or any part of the assets of the Trust in any group annuity, deposit administration or
guaranteed interest contract issued by an insurance company or other financial institution on a commingled
or collective basis with the assets of any other 457 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 Administrator, or such custodian as the Administrator 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.
5
(d) 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 foregoing, including the Administrator, or in bearer
form, to deposit or arrange for the deposit of securities in a qualified central depository even though, when
so deposited, 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.
(f) Upon such terms as may be deemed advisable by the Employer or the Administrator, 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 Plans 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 consideration 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 oflaw or equity or before any body or tribunal.
(g) To employ suitable consultants, depositories, agents, and legal counsel on behalf of the Plan.
(h) 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 Administrator, 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.
6.03 Taxes and Expenses. All taxes of any and all kinds whatsoever that may be levied or assessed under existing or
future laws upon the Plan, 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 Administrator, as may be agreed upon from time to time by the Employer
and the Administrator, and reimbursement for reasonable expenses incurred by the Administrator in performance of
its duties hereunder (including bur not limited to fees for legal, accounting, investment and custodial services) shall
also be paid from the Trust.
6.04 Payment of Benefits. The payment of benefits from the Trust in accordance with the terms of the Plan may
be made by the Administrator, or by any custodian or other person so authorized by the Employer to make such
disbursement. The Administrator, custodian or other person shall not be liable with respect to any distribution of
Trust assets made at the direction of the Employer.
6.05 Investment Funds. In accordance with uniform and nondiscriminatory rules established by the Employer and
the Administrator, the Participant may direct his or 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. Neither the Employer, the Administrator, nor any other person
shall be liable for any losses incurred by virtue of following such directions or with any reasonable administrative delay
in implementing such directions.
6
'. 6.06 ' , 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 Accounting Date. For purposes of this
Article, all Account balances include the Account balances of all Participants and Beneficiaries.
6.07 Participant Loan Accounts. Participant loan accounts shall be invested in accordance with Section 8.03 of the
Plan. Such Accounts shall not share in any investment income and gains or losses of the investment funds described in
Sections 6.05 and 6.06.
6.08 Crediting of Accounts. The Participant's Account shall reflect the amount and value of the investments or other
property obtained by the Employer through the investment of the Participant's Deferred Compensation pursuant to
Sections 6.05 and 6.06. It is anticipated that the Employer's investments with respect to a Participant will conform to
the investment preference specified in the Participant's Joinder Agreement, but nothing herein shall be construed to
require the Employer to make any particular investment of a Participant's Deferred Compensation. Each Participant
shall receive periodic reports, not less frequently than annually, showing the then current value of his or her Account.
6.09 Post-Severance Transfers Among Eligible Deferred Compensation Plans.
(a) Incoming Transfers: A transfer may be accepted from an eligible deferred compensation plan maintained by
another employer and credited to a Participant's or Beneficiary's Account under the Plan if:
(1) In the case of a transfer for a Participant, the Participant has had a Severance Event with that
employer and become an Employee of the Employer;
(2) The other employer's plan provides that such transfer will be made; and
(3) The Participant or Beneficiary whose deferred amounts are being transferred will have an amount
immediately after the transfer at least equal to the deferred amount immediately before the transfer.
The Employer may require such documentation from the predecessor plan as it deems necessary to effectuate
the transfer in accordance with Section 457(e)(10) of the Code, to confirm that such plan is an eligible
deferred compensation plan within the meaning of Section 457(b) of the Code, and to assure that transfers are
provided for under such plan. The Employer may refuse to accept a transfer in the form of assets other than
cash, unless the Employer and the Administrator agree to hold such other assets under the Plan.
(b) Outgoing Transfers: An amount may be transferred to an eligible deferred compensation plan maintained by
another employer, and charged to a Participant's or Beneficiary's Account under this Plan, if:
(1) In the case of a transfer for a Participant, the Participant has a Severance Event with the Employer
and becomes an employee of the other employer;
(2) The other employer's plan provides that such transfer will be accepted;
(3) The Participant or Beneficiary and the employers have signed such agreements as are necessary to
assure that the Employer's liabiiity to pay benefits to the Participant has been discharged and assumed
by the other employer; and
(4) The Participant or Beneficiary whose deferred amounts are being transferred will have an amount
immediately after the transfer at least equal to the deferred amount immediately before the transfer.
The Employer may require such documentation from the other plan as it deems necessary to effectuate the
transfer, to confirm that such plan is an eligible deferred compensation plan within the meaning of Section
7
457(b) of the Code, and to assure that transfers are provided for under such plan. Such transfers s
made only under such circumstances as are permitted under Section 457 of the Code and the regula
thereunder.
6.10 Transfers Among Eligible Deferred Compensation Plans of the Employer.
(a) Incoming Transfers. A transfer may be accepted from another eligible deferred compensation plan m
by the Employer and credited to a Participant's or Beneficiary's Account under the Plan if:
(1) The Employer's other plan provides that such transfer will be made;
(2) The Participant or Beneficiary whose deferred amounts are being transferred will have an am
immediately after the transfer at least equal to the deferred amount immediately before the tr'
and
(3) The Participant or Beneficiary whose deferred amounts are being transferred is not eligible for
additional annual deferrals in the Plan unless the Participant or Beneficiary is performing servi
the Employer.
(b) Outgoing Transfers. A transfer may be accepted from another eligible deferred compensation plan main
by the Employer and credited to a Participant's or Beneficiary's Account under the Plan if:
(1) The Employer's other plan provides that such transfer will be accepted;
(2) The Participant or Beneficiary whose deferred amounts are being transferred will have an amoun,
immediately after the transfer at least equal to the deferred amount immediately before the trans:
and .
(3) The Participant or Beneficiary whose deferred amounts are being transferred is not eligible for ..
additional annual deferrals in the Employer's other eligible deferred compensation plan unless the
Participant or Beneficiary is performing services for the Employer. ..
6.11 Eligible Rollover Distributions.
(a)
Incoming Rollovers: An eligible rollover distribution may be accepted from an eligible retirement plan and'
credited to a Participant's Account under the Plan. The Employer may require such documentation from';
distributing plan as it deems necessary to effectuate the rollover in accordance with Section 402 of the Co,.
and to confirm that such plan is an eligible retirement plan within the meaning of Section 402(c)(8)(B) 0"
Code. The Plan shall separately account (in one or more separate accounts) for eligible rollover distributio~:
from any eligible retirement plan. '
(b)
Outgoing Rollovers: Notwithstanding any provision of the Plan to the contrary that would otherwise r. .'
a distributee's election under this Section, a distributee may elect, at the time and in the manner prescnb
by the Administrator, to have any portion of an eligible rollover distribution paid directly to an eligible
retirement plan specified by the distributee in a direct rollover.
(c)
Definitions:
(1)
Eligible Rollover Distribution: An eligible rollover distribution is any distribution of all or any pOt,:
of the balance to the credit of the distributee, except that an eligible rollover distribution does no~
include: any distribution that is one of a series of substantially equal periodic payments (not lc:ss .'.~
~r~que.ntly than an~ually) mad~ fo.r the life (or life .ex~ectan~) o~ the distribute~ or the joint ~IV:;
Jomt lIfe expectancIes) of the dIstnbutee and the dIstnbutees deSIgnated benefiCIary, or for a Pi'"
period of ten years or more; any distribution to the extent such distribution is required under Se
8
401 (a)(9) and 457(d) (2) of the Code; and any distribution made as a result of an unforeseeable
emergency of the employee. For purposes of distributions from other eligible retirement plans
rolled over into this Plan, the term eligible rollover distribution shall not include the portion of any
distribution that is not includible in gross income (determined without regard to the exclusion for net
unrealized appreciation with respect to employer securities).
(2) Eligible Retirement Plan: An eligible retirement plan is 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 Sections 403(a) or 403(b) of the Code, a qualified trust described
in Section 401 (a) of the Code, or an eligible deferred compensation plan described in Section
457(b) of the Code which is maintained by an eligible governmental employer described in Section
457(e)(l)(A) of the Code, that accepts the distributee's eligible rollover distribution.
(3) Distributee: A distributee includes an employee or former employee. In addition, the employee's or
former employee's surviving spouse and the employee's or former employee's spouse or former spouse
who is the alternate payee under a qualified domestic relations order, as defined in Section 414(p) of
the Code, are distributees with regard to the interest of the spouse or former spouse.
(4) Direct Rollover: A direct rollover is a payment by the plan to the eligible retirement plan specified by
the distributee.
6.12 Trustee-to- Trustee Transfers to Purchase Permissive Service Credit. Allor a portion of a Participant's
Account may be transferred directly to the trustee of a defined benefit governmental plan (as defined in Section 414(d)
of the Code) if such transfer is (a) for the purchase of permissive service credit (as defined in Section 415(n)(3)(A)
of the Code) under such plan, or (b) a repayment to which Section 415 of the Code does not apply by reason of
subsection (k)(3) thereof, within the meaning of Section 457(e)(l7) of the Code.
6.13 Treatment of Distributions of Amounts Previously Rolled Over From 401 (a) and 403(b) Plans and
IRAs. For purposes of Section 72( t) of the Code, a distribution from this Plan shall be treated as a distribution
from a qualified retirement plan described in Section 4974(c)(l) of the Code to the extent that such distribution is
attributable to an amount transferred to an eligible deferred compensation plan from a qualified retirement plan (as
defined in Section 4974(c) of the Code).
6.14 Employer Liability. In no event shall the Employer's liability to pay benefits to a Participant under this Plan exceed
the value of the amounts credited to the Participant's Account; neither the Employer nor the Administrator shall be
liable for losses arising from depreciation or shrinkage in the value of any investments acquired under this Plan.
Article VII. Benefits
ment Benefits and Election on Severance Event.
General Rule: Except as otherwise provided in this Article VII, the distribution of a Participant's Account
shall commence as of a Participant's Automatic Distribution Date, and the distribution of such benefits shall
be made in accordance with one of the payment options described in Section 7.02. Notwithstanding the
foregoing, but subject to the following paragraphs of this Section 7.01, the Participant may elect following a
Severance Event to have the distribution of benefits commence on a fixed determinable date other than that
des~ribed in the preceding sentence, but not later than April I of the year following the year of the Participant's
Retl~ement or attainment of age 70-1/2, whichever is later. The Participant's right to change his or her
election with respect to commencement of the distribution of benefits shall not be restrained by this Section
7.01: .Notwithstanding the foregoing, the Administrator, in order to ensure the orderly administration of this
brovlslon, may establish a deadline after which such election to defer the commencement of distribution of
enefits shall not be allowed.
9
.
,
.
.
(b) Loans: Notwithstanding the foregoing provisions of this Section 7.01, no election to defer the
commencement of benefits after a Severance Event shall operate to defer the distribution of any amount in the
Participant's loan account in the event of a default of the Participant's loan.
7.02 Payment Options. As provided in Sections 7.01, 7.04 and 7.05, a Participant may elect to have value of the
Participant's Account distributed in accordance with one of the following payment options, provided that such option
is consistent with the limitations set forth in Section 7.03:
(a) Equal monthly, quarterly, semi-annual or annual payments in an amount chosen by the Participant,
continuing until his or her Account is exhausted;
(b) One lump-sum payment;
(c) Approximately equal monthly, quarterly, semi-annual or annual payments, calculated to continue for a period
certain chosen by the Participant;
(d) Annual Payments equal to the minimum distributions required under Section 401 (a)(9) of the Code,
including the incidental death benefit requirements of Section 401 (a) (9)(G), over the life expectancy of the
Participant or over the life expectancies of the Participant and his or her Beneficiary;
(e) Payments equal to payments made by the issuer of a retirement annuity policy acquired by the Employer;
(f) A split distribution under which payments under options (a), (b), (c) or (e) commence or are made at the
same time, as elected by the Participant under Section 7.01, provided that all payments commence (or are
made) by the latest benefit commencement date permitted under Section 7.01;
(g) Any other payment option elected by the Participant and agreed to by the Employer and Administrator.
A Participant's selection of a payment option under Subsections (a), (c), or (g) above may include the selection of an
automatic annual cost-ofliving increase. Such increase will be based on the rise in the Consumer Price Index for All
Urban Consumers (CPI-U) from the third quarter of the last year in which a cost-of-living increase was provided to
the third quarter of the current year. Any increase will be made in periodic payment checks beginning the following
January.
7.03 Limitation on Options. No payment option may be selected by a Participant under subsections 7.02(a) or (c)
unless the amount of any installment is not less than $100. No payment option may be selected by a Participant
under Sections 7.02, 7.04, or 7.05 unless it satisfies the requirements of Sections 401 (a) (9) and 457(d) (2) of the Code,
including that payments commencing before the death of the Participant shall satisfy the incidental death benefit
requirements under Section 401 (a)(9)(G) of the Code.
7.04 Minimum Required Distributions. Notwithstanding any provision of the Plan to the contrary, the Plan shall
comply with the minimum required distribution rules set forth in Sections 457(d)(2) and 401 (a) (9) of the Code,
including the incidental death benefit requirements of Section 401 (a)(9) (G) of the Code.
7.05 Post-Retirement Death Benefits.
(a) Should the Participant die after he or she has begun to receive benefits under a payment option, the remaining
payments, if any, under the payment option shall continue until the Administrator receives notice of the
Participant's death. Upon notification of the Participant's death, benefits shall be payable to the Participant's
Beneficiary commencing not later than December 31 of the year following the year of the Participant's death,
provided that the Beneficiary may elect to begin benefits earlier than that date.
(b) In the event that the Beneficiary dies before the payment of death benefits has commenced or been completed,
the remaining benefits payable under the payment option applicable to the Beneficiary shall, subject to the
10
requirements set forth in Section 7.04, be paid to an additional beneficiary designated by the Beneficiary. If
no additional beneficiary is named, payment shall be made to the Beneficiary's estate in a lump sum.
(c)
In the event that the Participant's estate is the Beneficiary, payment shall be made to the estate in a lump sum.
Pre-Retirement Death Benefits.
Should the Participant die before he or she has begun to receive the benefits provided by Section 7.01, the
value of the Participant's Account shall be payable to the Beneficiary commencing not later than December
31 of the year following the year of the Participant's death, provided that the Beneficiary may elect to begin
benefits earlier than that date.
In the event that the Beneficiary dies before the payment of death benefits has commenced or been completed,
the remaining value of the Participant's Account shall be paid to the estate of the Beneficiary in a lump sum.
In the event that the Participant's estate is the Beneficiary, payment shall be made to the estate in a lump sum.
Unforeseeable Emergencies.
In the event an unforeseeable emergency occurs, a Participant or Beneficiary may apply to the Employer to
receive that part of the value of his or her Account that is reasonably needed to satisfY the emergency need.
If such an application is approved by the Employer, the Participant or Beneficiary shall be paid only such
amount as the Employer deems necessary to meet the emergency need, but payment shall not be made to the
extent that the financial hardship may be relieved through cessation of deferral under the Plan, insurance or
other reimbursement, or liquidation of other assets to the extent such liquidation would not itself cause severe
financial hardship.
An unforeseeable emergency shall be deemed to involve only circumstances of severe financial hardship
of a Participant or Beneficiary resulting from an illness or accident of the participant or beneficiary, the
Participant's or Beneficiary's spouse, or the Participant's or Beneficiary's dependent (as defined in Section
152 of the Code, and, for taxable years beginning on or after January 1, 2005, without regard to Sections
152(b)(1), (b)(2), and (d)(1)(B) of the Code); loss of the Participant's or Beneficiary's property due to
casualty (including the need to rebuild a home following damage to a home not otherwise covered by
homeowner's insurance, e.g., as a result of a natural disaster); or other similar extraordinary and unforeseeable
circumstances arising as a result of events beyond the control of the Participant or the Beneficiary. For
example, the imminent foreclosure of or eviction from the Participant's or Beneficiary's primary residence
may constitute an unforeseeable emergency. In addition, the need to pay for medical expenses, including
non-refundable deductibles, as well as for the cost of prescription drug medication, may constitute an
unforeseeable emergency. Finally, the need to pay for the funeral expenses of a spouse or a dependent (as
defined in section 152 of the Code, and, for taxable years beginning on or after January 1, 2005, without
regard to Sections 152(b)(I), (b)(2), and (d)(1)(B) of the Code) may also constitute an unforeseeable
emergency. Except as otherwise specifically provided in this Section 7.07(b), the purchase of a home and the
payment of college tuition are not unforeseeable emergencies.
-Service Distribution of Rollover Contributions. Effective January 1, 2006, the Employer may elect to
ow Participants to receive an in-service distribution of amounts attributable to rollover contributions to the Plan. If
,.. e Employer has elected to make such distributions available, a Participant that has a separate account attributable
fO r?llover contributions to the Plan, may at any time request a distribution of all or any portion of the amount
~ttnbutable to his or her rollover contribution.
11
Article VIII. Loans to Participants
7.09 In-Service Distribution to Participants Age 70-112 or Older. A Participant who has reached age 70'
has not yet had a Severance Event, may, at any time, request a distribution of all or a part of his or her Acco
Participant may only receive two (2) such distributions pursuant to this Section 7.09 in any calendar year.
7.10 Distribution De Minimis Accounts. Notwithstanding the foregoing provisions of this Article VII:
(a) Mandatory Distribution. If the value of a Participant's Account is less than $1,000, the Participant's
shall be paid to the Participant in a single lump sum distribution, provided that:
(1) No amount has been deferred under the Plan with respect to the Participant during the 2-year
ending on the date of the distribution; and
(2) There has been no prior distribution under the Plan to the Participant pursuant to this Sectio
(b) Voluntary Distribution. If the value of the Participant's Account is at least $1,000 but not more than th
limit under Section 411 (a) (11)(A) of the Code, the Participant may elect to receive his or her entire Ac
in a lump sum payment if:
(1) No amount has been deferred under the Plan with respect to the Participant during the 2-year
ending on the date of the distribution; and
(2) There has been no prior distribution under the Plan to the Participant pursuant to this Section
8.01 Availability of Loans to Participants.
(a) The Employer may elect to make loans available to Participants in this Plan. If the Employer has elected
to make loans available to Participants, a Participant may apply for a loan from the Plan subject to the
limitations and other provisions of this Article. However, no loans are available from Deemed lRAs.
(b) The Employer shall establish written guidelines governing the granting ofloans, provided that such guidelines
are approved by the 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.
8.02 Terms and Conditions of Loans to Participants. Any loan by the Plan to a Participant under Section 8.01 of
the Plan shall satisfy the following requirements:
(a) Availability. Loans shall be made available to all Participants on a reasonably equivalent basis.
(b) Interest Rate. Loans must be adequately secured and bear a reasonable interest rate.
(c) Loan Limit. No Participant loan shall exceed the present value of the Participant's Account.
(d) Foreclosure. In the event of default on any installment payment, the outstanding balance of the loan shall be a
deemed distribution. In such event, an actual distribution of a plan loan offset amount will not occur until a
distributable event occurs in the Plan.
(e) Reduction of Account. Notwithstanding any other provision of this Plan, the portion of the Participant's
Account balance used as a security interest held by the Plan by reason of a loan outstanding to the Participant
shall be taken into account 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 loan.
12
(f) 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 from the Plan and
from all other plans of the Employer that are either eligible deferred compensation plans described in section
457(b) of the Code or qualified employer plans under Section n(p) (4) of the Code shall not exceed the lesser
of:
(1) $50,000, reduced by the excess (if any) of
(i) 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; or
(ii) The outstanding balance ofloans from the Plan on the date on which such loan is made; or
(2) One-half of the value of the Participant's interest in all of his or her Accounts under this Plan.
(g) 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's 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.
(h) Length of Loan. Any loan issued 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 of the loan; provided, however, that if the 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 of 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 for up to one (1) year during
an authorized leave of absence, if the promissory note so provides, but not beyond the original term permitted
under this subsection (h), with a revised payment schedule (within such term) instituted at the end of such
period of suspension.
Prepayment. The Participant shall be permitted to repay the loan in whole or in part at any time prior to
maturity, without penalty.
Promissory Note. The loan shall be evidenced by a promissory note executed by the Participant and delivered
to the Employer, and shall bear interest at a reasonable rate determined by the Employer.
Security. The loan shall be secured by an assignment of the participant's right, tide and interest in and to his
or her Account.
Assignment or Pledge. For the purposes of paragraphs (f) and (g), 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.
Other Terms and Conditions. The Employer shall fix such other terms and conditions of the loan as it deems
necessary to comply with legal requirements, to maintain the qualification of the Plan and Trust under Section
457 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 also fix other terms and conditions of the loan, including,
but not limited to, the provision of grace periods following an event of default, not inconsistent with the
provisions of this Article and Section 72(p) of the Code, and any applicable regulations thereunder.
13
Article IX. Deemed IRAs
8.03 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 whic
the loan is to be made.
(b) 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 8.01 of the Plan or in cas
Uninvested cash balances in a Participant's loan account shall not bear interest. Neither the Employer, the
Administrator, nor any other person 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 (1) or more other investment
funds, in accordance with Section 6.05 of the Plan, as of the next Accounting Date after payment thereof to
the Trust. The amount so invested shall be deducted from the Participant's loan account.
(d) The Employer shall have the authority to establish other reasonable rules, not inconsistent with the provisions
of the Plan, governing the establishment and maintenance of Participant loan accounts.
9.01 General. This Article IX of the Plan reflects section 602 of the Economic Growth and Tax Relief Reconciliation Act
of 200 1 ("EGTRRA"), as amended by the Job Creation and Worker Assistance Act of 2002. This Article is intended
as good faith compliance with the requirements ofEGTRRA and is to be construed in accordance with EGTRRA
and guidance issued thereunder. This Article IX shall supersede the provisions of the Plan to the extent that those
provisions are inconsistent with the provisions of this Article IX.
Effective for Plan Years beginning after December 31, 2002, the Employer may elect to allow Employees to make
voluntary employee contributions to a separate account or annuity established under the Plan that complies with
the requirements of Section 408(q) of the Code and any regulations promulgated thereunder (a "Deemed IRA").
The Plan shall establish a separate account for the designated Deemed IRA contributions of each Employee and
any earnings properly allocable to the contributions, and maintain separate recordkeeping with respect to each such
Deemed IRA.
9.02 Voluntary Employee Contributions. For purposes of this Article, a voluntary employee contribution means any
contribution (other than a mandatory contribution within the meaning of Section 411 (c)(2) of the Code) that is made
by the Employee and which the Employee has designated, at or prior to the time of making the contribution, as a
contribution to which this Article applies.
9.03 Deemed IRA Trust Requirements. This Article shall satisfy the trust requirement under Section 408(q) of the
Code and the regulations thereto. IRAs established pursuant to this Article shall be held in one or more trusts or
custodial accounts (the "Deemed IRA Trusts"), which shall be separate from the Trust established under the Plan
to hold contributions other than Deemed IRA contributions. The Deemed IRA Trusts shall satisfy the applicable
requirements of Sections 408 and 408A of the Code, which requirements are set forth in section 9.05 and 9.06,
respectively, and shall be established with a trustee or custodian meeting the requirements of Section 408(a)(2) of
the Code ("Deemed IRA Trustee"). To the extent that the assets of any Deemed IRAs established putsuant to this
Article are held in a Deemed IRA Trust satisfying the requirements of this Section 9.03, such Deemed IRA Trust,
and any amendments thereto, is hereby adopted as a trust maintained under this Plan with respect to the assets held
therein, and the provisions of such Deemed IRA Trust shall control so long as any assets of any Deemed IRA are held
thereunder.
14
Reporting Duties. The Deemed IRA Trustee shall be subject to the reporting requirements of Section 408(i) of the
Code with respect to all Deemed IRAs that are established and maintained under the Plan.
Deemed Traditional IRA Requirements. Deemed IRAs established in the form of traditional IRAs shall satisfy
the following requirements:
(a) Exclusive Benefit. The Deemed IRA account shall be established for the exclusive benefit of an Employee or
his or her Beneficiaries.
(b) Maximum Annual Contributiom.
(1) Except in the case of a rollover contribution (as permitted by Sections 402(c), 402(e)(6), 403(a)(4),
403(b)(8), 403(b)(10), 408(d)(3) and 457(e)(16) of the Code), no contributions will be accepted
unless they are in cash, and the total of such contributions shall not exceed:
$3,000 for any taxable year beginning in 2002 through 2004;
$4,000 for any taxable year beginning in 2005 through 2007; and
$5,000 for any taxable year beginning in 2008 and years thereafter.
After 2008, the limit will be adjusted by the Secretary of the Treasury for cost-of-living-increases
under Section 219(b)(5)(C) of the Code. Such adjustments will be in multiples of $500.
(2) In the case of an Employee who is 50 or older, the annual cash contribution limit is increased by:
$500 for any taxable year beginning in 2002 through 2005; and
$1,000 for any taxable year beginning in 2006 and thereafter.
(3) No contributions will be accepted under a SIMPLE IRA plan established by any employer pursuant
to Section 408(p) of the Code. Also, no transfer or rollover of funds attributable to contributions
made by a particular employer under its SIMPLE IRA plan will be accepted from a SIMPLE IRA,
that is an IRA used in conjunction with a SIMPLE IRA plan, prior to the expiration of the 2-year
period beginning on the date the Employee first participated in that employer's SIMPLE IRA plan.
(c) Collectibles. If the Deemed IRA Trust acquires collectibles with within the meaning of Section 408(m) of the
Code after December 31, 1981, Deemed IRA Trust assets will be treated as a distribution in an amount equal
to the cost of such collectibles.
(d) Life Insurance Contracts. No part of the Deemed IRA Trust funds will be invested in life insurance contracts.
(e) Minimum Required Distributiom.
(1) Notwithstanding any provision of this Deemed IRA to the contrary, the distribution of the
Employee's interest in the account shall be made in accordance with the requirements of Section
408(a)(6) of the Code and the Income Tax Regulations thereunder, the provisions of which are
herein incorporated by reference. If distributions are made from an annuity contract purchased
from an insurance company, distributions thereunder must satisfy the requirements of Q&A-4 of
Section 1.401 (a) (9)-6T of the Income Tax Regulations (or Section 1.401 (a) (9)-6 of the Income Tax
Regulations, as applicable), rather than paragraphs (2), (3) and (4) below and Section 9.05(f). The
minimum required distributions calculated for this IRA may be withdrawn from another IRA of the
Employee in accordance with Q&A-9 of Section 1.408-8 of the Income Tax Regulations.
(2) The entire value of the account of the Employee for whose benefit the account is maintained will
commence to be distributed no later than the first day of April following the calendar year in which
15
(ii)
such Employee attains age 70-1/2 (the "required beginning date") over the life of such Employee 0
the lives of such Employee and his or her Beneficiary.
(3) The amount to be distributed each year, beginning with the calendar year in which the Employee
attains age 70-1/2 and continuing through the year of death shall not be less than the quotient
obtained by dividing the value of the IRA (as determined under section 9.05(f)(3)) as of the end of
the preceding year by the distribution period in the Uniform Lifetime Table in Q&A-2 of Section
401 (a)(9)-9 of the Income Tax Regulations, using the Employee's age of his or her birthday in the
year. However, if the Employee's sole Beneficiary is his or her surviving spouse and such spouse is
more than 10 years younger than the Employee, then the distribution period is determined under
the Joint and Last Survivor Table in Q&A-3 of Section 1.401 (a)(9)-9 of the Income Tax Regulations,
using the ages as of the Employee's and spouse's birthdays in the year.
(4) The required minimum distribution for the year the Employee attains age 70-1/2 can be made as late
as April 1 of the following year. The required minimum distribution for any other year must be made
by the end of such year.
(f) Distribution Upon Death.
(1) Death On or After Required Beginning Date. If the Employee dies on or after the required beginning
date, the remaining portion of his or her interest will be distributed at least as rapidly as follows:
(iv)
(i) If the Beneficiary is someone other than the Employee's surviving spouse, the remaining
interest will be distributed over the remaining life expectancy of the Beneficiary, with such
life expectancy determined using the Beneficiary's age as of his or her birthday in the year
following the year of the Employee's death, or over the period described in paragraph (1)(iii)
below if longer.
If the Employee's sole Beneficiary is the Employee's surviving spouse, the remaining interest
will be distributed over such spouse's life or over the period described in paragraph (1) (iii)
below if longer. Any interest remaining after such spouse's death will be distributed over
such spouse's remaining life expectancy determined using the spouse's age as of his or her
birthday in the year of the spouse's death, or, if the distributions are being made over the
period described in paragraph (1)(iii) below, over such period.
~
-'
;t
t
I
t
i
i
(iii)
If there is no Beneficiary, or if applicable by operation of paragraph (l)(i) or (l)(ii) above,
the remaining interest will be distributed over the Employee's remaining life expectancy
determined in the year of the Employee's death.
"1
,
l
"l
The amount to be distributed each year under paragraph (1)(i), (ii), or (iii), beginning
with the calendar year following the calendar year of the Employee's death, is the quotient
obtained by dividing the value of the IRA as of the end of the preceding year by the
remaining life expectancy specified in such paragraph. Life expectancy is determined using
the Single Life Table in Q&A-l of Section 1.401 (a)(9)-9 of the Income Tax Regulations.
If distributions are being made to a surviving spouse as the sole Beneficiary, such spouse's
remaining life expectancy for a year is the number in the Single Life Table corresponding to
such spouse's age in the year. In all other cases, remaining life expectancy for a year is the
number in the Single Life Table corresponding to the Beneficiary's or Employee's age in the
year specified in paragraph 1 (i), (ii), or (iii) and reduced by 1 for each subsequent year.
(2) Death Before Required Beginning Date. If the Employee dies before the required beginning date, his or
her entire interest will be distributed at least as rapidly as follows:
(i)
If the Beneficiary is someone other than the Employee's surviving spouse, the entire interest
will be distributed, starting by the end of the calendar year following the calendar year of
16
~
the Employee's death, over the remaining life expectancy of the Beneficiary, with such life
expectancy determined using the age of the Beneficiary as of his or her birthday in the year
following the year of the Employee's death, or, if elected, in accordance with paragraph
(2)(iii) below.
(ii) If the Employee's sole Beneficiary is the Employee's surviving spouse, the entire interest
will be distributed, starting by the end of the calendar year following the calendar year of
the Employee's death (or by the end of the calendar year in which the Employee would
have attained age 70-1/2, iflater), over such spouse's life, or, if elected, in accordance with
paragraph (2)(iii) below. If the surviving spouse dies before distributions are required to
begin, the remaining interest will be distributed, starting by the end of the calendar year
following the calendar year of the spouse's death, over the spouse's Beneficiary's remaining
life expectancy determined using such Beneficiary's age as of his or her birthday in the
year following the death of the spouse, or, if elected, will be distributed in accordance with
paragraph (2)(iii) below. If the surviving spouse dies after distributions are required to
begin, any remaining interest will be distributed over the spouse's remaining life expectancy
determined using the spouse's age as of his or her birthday in the year of the spouse's death.
(iii) If there is no Beneficiary, or if applicable by operation of paragraph (2)(i) or (2)(ii) above,
the entire interest will be distributed by the end of the calendar year containing the fifth
anniversary of the Beneficiary's death (or of the spouse's death in the case of the surviving
spouse's death before distributions are required to begin under paragraph (2)(ii) above).
(iv) The amount to be distributed each year under paragraph (2)(i) or (ii) is the quotient to
be obtained by dividing the value of the IRA as of the end of the preceding year by the
remaining life expectancy specified in such paragraph. Life expectancy is determined using
the Single Life Table in Q&A-l of Section 1.401 (a)(9)-9 of the Income Tax Regulations.
If distributions are being made to a surviving spouse as the sole Beneficiary, such spouse's
remaining life expectancy for a year is the number in the Single Life Table corresponding to
the Beneficiary's age in the year specified in paragraph (2)(i) or (ii) and reduced by 1 for each
subsequent year.
(v) The "value" of the IRA includes the amount of any outstanding rollover, transfer and
recharacterization under Q&As-7 and -8 of Section 1.408-8 of the Income Tax Regulations.
(vi) If the sole Beneficiary is the Employee's stirviving spouse, the spouse may elect to treat
the IRA as his or her own IRA. This election will be deemed to have been made if such
surviving spouse makes a contribution to the IRA or fails to take required distributions as a
Beneficiary.
(g) Nonforfeitable. The interest of an Employee in the balance in his or her Deemed IRA account is
nonforfeitable at all times.
(h) Reporting. The Deemed IRA Trustee of a Deemed Traditional IRA shall furnish annual calendar-year reports
concerning the status of the Deemed IRA account and such information concerning required minimum
distributions as is prescribed by the Commissioner ofInternal Revenue.
(i) Substitution of Deemed IRA Trustee. If the Deemed IRA Trustee is a non-bank trustee or custodian, the non-
bank trustee or custodian shall substitute another trustee or custodian if the non-bank trustee or custodian
receives notice from the Commissioner of Internal Revenue that such substitution is required because it has
failed to comply with the requirements of Section 1.408-2(e) of the Income Tax Regulations and Section
1.408-2T of the Income Tax Regulations
17
(1) Maximum Permissible Amount. Except in the case of a qualified rollover contribution or
recharacterization (as defined in (6) below), no contribution will be accepted unless it is in cash and
the total of such contributions to all the Employee's Roth IRAs for a taxable year does not exceed
the applicable amount (as defined in (2) below), or the Employee's compensation (as defined in (8)
below) ifless, for that taxable year. The contribution described in the previous sentence that may
not exceed the lesser of the applicable amount or the Employee's compensation is referred to as a
"regular contribution." A "qualified rollover contribution" is a rollover contribution that meets the
requirements of Section 408(d)(3) of the Code, except the one-rollover-per-year rule of Section
408(d)(3)(B) does not apply if the rollover contribution is from another IRA other than a Roth IRA
(a "nonRoth IRA"). Contributions may be limited under (3) through (5) below.
"
9.06 Deemed Roth IRA Requirements. Deemed IRAs established in the form of Roth IRAs shall satisfy the following
requirements:
(a) Exclusive Benefit. The Deemed Roth IRA shall be established for the exclusive benefit of an Employee or his
or her Beneficiaries.
(b) Maximum Annual Contributiom.
(2) Applicable Amount. The applicable amount is determined under (i) or (ii) below:
(i) If the Employee is under age 50, the applicable amount is:
$3,000 for any taxable year beginning in 2002 through 2004;
$4,000 for any taxable year beginning in 2005 through 2007; and
$5,000 for any taxable year beginning in 2008 and years thereafter.
(ii) If the Employee is 50 or older, the applicable amount is:
$3,500 for any taxable year beginning in 2002 through 2004;
$4,500 for any taxable year beginning in 2005;
$5,000 for any taxable year beginning in 2006 through 2007; and
$6,000 for any taxable year beginning in 2008 and years thereafter.
After 2008, the limits in paragraph (2)(i) and (ii) above will be adjusted by the Secretary of the
Treasury for cost-of-living increases under Section 219(b)(5)(C) of the Code. Such adjustments will
be in multiples of $500.
(3) If (i) andlor (ii) below apply, the maximum regular contribution that can be made to all the
Employee's Roth IRAs for the taxable year is the smaller amount determined under (i) or (ii).
18
(i) The maximum regular contribution is phased out ratably between certain levels of modified
adjusted gross income ("modified AGI," defined in (7) below) in accordance with the
following table:
Modified AGI
Filing Status
Full
Contribution
No
Contribution
Phase-out
Ran~e
Single or Head
of Household
Joint Return
or Qualifying
Widower
$95,000 or less
$110,000
Between $95,000
and $110,000
or more
$150,000 or less
Between $150,000
and $160,000
$160,000
or more
Married -
Separate Return
Between $0
and $10,000
$0
$10,000
or more
If the Employee's modified AGI for a taxable year is in the phase-out range, the maximum
regular contribution determined under this table for that taxable year is rounded up to the
next multiple of $1 0 and not reduced below $200.
(ii) If the Employee makes regular contributions to both Roth and nonRoth IRAs for a taxable
year, the maximum regular contribution that can be made to all the Employee's Roth IRAs
for that taxable year is reduced by the regular contributions made to the Employee's nonRoth
IRAs for the taxable year.
(4) Qualified Rollover Contribution Limit. A rollover from a nonRoth IRA cannot be made to this IRA if,
for the year the amount is distributed from the nonRoth IRA, (i) the Employee is married and files a
separate return, (ii) the Employee is not married and has modified AGI in excess of $1 00,000 or (iii)
the Employee is married and together the Employee and the Employee's spouse have modified AGI
in excess of $100,000. For purposes of the preceding sentence, a husband and wife are not treated as
married for a taxable year if they have lived apart at all times during that taxable year and file separate
returns for the taxable year.
(5) SIMPLE IRA Limits. No contributions will be accepted under a SIMPLE IRA plan established
by any employer pursuant to Section 408(p) of the Code. Also, no transfer or rollover of funds
attributable to contributions made by a particular employer under its SIMPLE IRA plan will be
accepted from a SIMPLE IRA, that is, an IRA used in conjunction with a SIMPLE IRA plan, prior
to the expiration of the 2-year period beginning on the date the Employee first participated in that
employer's SIMPLE IRA plan.
(6) Recharacterization. A regular contribution to a nonRoth IRA may be recharacterized pursuant to
the rules in Section 1.408A-5 of the Income Tax Regulations as a regular contribution to this IRA,
subject to the limits in (3) above.
(7) Modified AGI. For purposes of (3) and (4) above, an Employee's modified AGI for a taxable year
is defined in Section 408A(c)(3)(C)(i) of the Code and does not include any amount included in
adjusted gross income as a result of a rollover from a nonRoth IRA (a "conversion").
(8) Compemation. For purposes of (1) above, compensation is defined as wages, salaries, professional
fees, or other amounts derived from or received for personal services actually rendered (including, but
not limited to, commissions paid salesmen, compensation for services on the basis of a percentage
of profits, commissions on insurance premiums, tips and bonuses) and includes earned income, as
defined in Section 401 (c) (2) of the Code (reduced by the deduction the self-employed individual
19
takes for contributions made to a self-employed retirement plan). For purposes of this definition,
Section 401 (c)(2) of the Code shall be applied as if the term trade or business for purposes of Section
1402 of the Code included service described in subsection (c)(6). Compensation does not include
amounts derived from or received as earnings or profits from property (including but not limited
to interest and dividends) or amounts not includible in gross income. Compensation also does
not include any amount received as a pension or annuity or as deferred compensation. The term
"compensation" shall include any amount includible in the Employee's gross income under Section
71 of the Code with respect to a divorce or separation instrument described in subparagraph (A)
of Section 71 (b)(2) of the Code In the case of a married Employee filing a joint return, the greater
compensation of his or her spouse is treated as his or her own compensation but only to the extent
that such spouse's compensation is not being used for purposes of the spouse making a contribution
to a Roth IRA or a deductible contribution to a nonRoth IRA.
(c) Collectibles. If the Deemed IRA Trust acquires collectibles within the meaning of Section 408(m) of the Code
after December 31, 1981, Deemed IRA Trust assets will be treated as a distribution in an amount equal to the
cost of such collectibles.
(d) Life Insurance Contracts. No part of the Deemed IRA Trust funds will be invested in life insurance contracts.
(e) Distributions Before Death. No amount is required to be distributed prior to the death of the Employee for
whose benefit the account was originally established.
(f) Minimum Required Distributions.
(1) Notwithstanding any provision of this IRA to the contrary, the distribution of the Employee's interest
in the account shall be made in accordance with the requirements of Section 408(a) (6) of the Code,
as modified by section 408A(c)(5), and the regulations thereunder, the provisions of which are herein
incorporated by reference. If distributions are made from an annuity contract purchased from an
insurance company, distributions thereunder must satisfy the requirements of section 1.401(a)(9)-6T
of the Temporary Income Tax Regulations (taking into account Section 408A(c)(5) of the Code) (or
Section 1.401 (a)(9)-6 of the Income Tax Regulations, as applicable), rather than the distribution rules
in paragraphs (2), (3) and (4) below.
(2) Upon the death of the Employee, his or her entire interest will be distributed at least as rapidly as
follows:
(i) If the Beneficiary is someone other than the Employee's surviving spouse, the entire
interest will be distributed, starting by the end of the calendar year following the year of
the Employee's death, over the remaining life expectancy of the Beneficiary, with such life
expectancy determined using the age of the beneficiary as of his or her birthday in the year
following the year of the Employee's death, or, if elected, in accordance with paragraph
(2)(iii) below.
(ii) If the Employee's sole Beneficiary is the Employee's surviving spouse, the entire interest
will be distributed starting by the end of the calendar year following the calendar year of
the Employee's death (or by the end of the calendar year in which the Employee would
have attained age 70-112, iflater), over such spouse's life, or, if elected, in accordance with
paragraph (2)(iii) below. If the surviving spouse dies before distributions are required to
begin, the remaining interest will be distributed, starting by the end of the calendar year
following the calendar year of the spouse's death, over the spouse's Beneficiary's remaining
life expectancy determined using such Beneficiary's age as of his or her birthday in the
year following the death of the spouse, or, if elected, will be distributed in accordance with
paragraph (2)(iii) below. If the surviving spouse dies after distributions are required to
begin, any remaining interest will be distributed over the spouse's remaining life expectancy
determined using the spouse's age as of his or her birthday in the year of the spouse's death.
20
(iii) If there is no Beneficiary, or if applicable by operation of paragraph (2)(i) or (2)(ii) above, the
entire interest will be distributed the end of the calendar year containing the fifth anniversary
of the Employee's death (or of the spouse's death in the case of the surviving spouse's death
before distributions are required to begin under paragraph 2(ii) above).
(iv) The amount to be distributed each year under paragraph (2)(i) or (ii) is the quotient
obtained by dividing the value of the IRA as of the end of the preceding year by the
remaining life expectancy specified in such paragraph. Life expectancy is determined using
the Single Life Table in Q&A-1 of Section 1.401 (a)(9)-9 of the Income Tax Regulations.
If distributions are being made to a surviving spouse as the sole Beneficiary, such spouse's
remaining life expectancy for a year is the number in the Single Life Table corresponding to
such spouse's age in the year. In all other cases, remaining life expectancy for a year is the
number in the Single Life Table corresponding to the Beneficiary's age in the year specified in
paragraph (2)(i) or (ii) and reduced by 1 for each subsequent year.
(3) The "value" of the IRA includes the amount of any outstanding rollover, transfer and
recharacterization under Q&As-7 and -8 of Section 1.408-8 of the Income Tax Regulations.
(4) If the sole Beneficiary is the Employee's surviving spouse, the spouse may elect to treat the IRA as his
or her own IRA. This election will be deemed to have been made if such surviving spouse makes a
contribution to the IRA or fails to take required distributions as a Beneficiary.
(g) Nonforfeitable. The interest of an Employee in the balance in his or her account is nonforfeitable at all times.
(h) Reporting. The Deemed IRA Trustee of a Deemed Roth IRA shall furnish annual calendar-year reports
concerning the status of the Deemed IRA account and such information concerning required minimum
distributions as is prescribed by the Commissioner of Internal Revenue.
(i) Substitution of Deemed IRA Trustee. If the Deemed IRA Trustee is a non-bank trustee or custodian, the non-
bank trustee or custodian shall substitute another trustee or custodian if the non-bank trustee or custodian
receives notice from the Commissioner ofInternal Revenue that such substitution is required because it has
failed to comply with the requirements of Section 1.408-2(e) of the Income Tax Regulations and Section
1.408-2T of the Income Tax Regulations.
Article X. Non-Assignability
10.01 General. Except as provided in Article VIII and Section 10.02, no Participant or Beneficiary shall have any right to
commute, sell, assign, pledge, transfer or otherwise conveyor encumber the right to receive any payments hereunder,
which payments and rights are expressly declared to be non-assignable and non-transferable.
10.02 Domestic Relations Orders.
(a) Allowance of Transfers: To the extent required under a final judgment, decree, or order (including approval of a
property settlement agreement) that (1) relates to the provision of child support, alimony payments, or marital
property rights and (2) is made pursuant to a state domestic relations law, and (3) is permitted under Sections
414(p)(11) and (12) of the Code, any portion of a Participant's Account may be paid or set aside for payment
to a spouse, former spouse, child, or other dependent of the Participant (an "Alternate Payee"). Where
necessary to carry out the terms of such an order, a separate Account shall be established with respect to the
Alternare Payee who shall be entitled to make investment selections with respect thereto in the same manner
as the Participant. Any amount so set aside for an Alternate Payee shall be paid in accordance with the form
and timing of payment specified in the order. Nothing in this Section shall be construed to authorize any
amount to be distributed under the Plan at a time or in a form that is not permitted under Section 457(b) of
21
..
the Code and is explicitly permitted under the uniform procedures described in Section 10.2(d) below. Any
payment made to a person pursuant to this Section shall be reduced by any required income tax withholding.
(b) Release from Liability to Participant: The Employer's liability to pay benefits to a Participant shall be reduced
to the extent that amounts have been paid or set aside for payment to an Alternate Payee to paragraph (a) of
this Section and the Participant and his or her Beneficiaries shall be deemed to have released the Employer
and the Plan Administrator from any claim with respect to such amounts.
(c) Participation in Legal Proceedings: The Employer and Administrator shall not be obligated to defend against
or set aside any judgment, decree, or order described in paragraph (a) or any legal order relating to the
garnishment of a Participant's benefits, unless the full expense of such legal action is borne by the Participant.
In the event that the Participant's action (or inaction) nonetheless causes the Employer or Administrator to
incur such expense, the amount of the expense may be charged against the Participant's Account and thereby
reduce the Employer's obligation to pay benefits to the Participant. In the course of any proceeding relating
to divorce, separation, or child support, the Employer and Administrator shall be authorized to disclose
information relating to the Participant's Account to the Alternate Payee (including the legal representatives of
the Alternate Payee), or to a court.
(d) Determination o/Validity o/Domestic Relations Orders: The Administrator shall establish uniform procedures
for determining the validity of any domestic relations order. The Administrator's determinations under such
procedures shall be conclusive and binding on all parties and shall be afforded the maximum amount of
deference permitted by law.
10.03 IRS Levy. Notwithstanding Section 10.01, the Administrator may pay from a Participant's or Beneficiary's Account
balance the amount that the Administrator finds is lawfully demanded under a levy issued by the Internal Revenue
Service with respect to that Participant or Beneficiary or is sought to be collected by the United States Government
under a judgment resulting from an unpaid tax assessment against the Participant or Beneficiary.
10.04 Mistaken Contribution. To the extent permitted by applicable law, if any contribution (or any portion of
a contribution) is made to the Plan by a good faith mistake of fact, then after the payment of the contribution,
and upon receipt in good order of a proper request approved by the Administrator, the amount of the mistaken
contribution (adjusted for any income or loss in value, if any, allocable thereto) shall be returned directly to the
Participant or, to the extent required or permitted by the Administrator, to the Employer.
10.05 Payments to Minors and Incompetents. If a Participant or Beneficiary entitled to receive any benefits hereunder
is a minor or is adjudged to be legally incapable if giving valid receipt and discharge for such benefits, or is deemed so
by the Administrator, benefits will be paid to such persons as the Administrator may designate for the benefit of such
Participant or Beneficiary. Such payments shall be considered a payment to such Participant or Beneficiary and shall,
to the extent made, be deemed a complete discharge of any liability for such payments under the Plan.
10.06 Procedure When Distributee Cannot Be Located. The Administrator shall make all reasonable attempts to
determine the identity and address of a Participant or a Participant's Beneficiary entitled to benefits under the Plan.
For this purpose, a reasonable attempt means (a) the mailing by certified mail of a notice to the last known address
shown on the Employer or Administrator's records, (b) notification sent to the Social Security Administration or the
Pension Benefit Guarantee Corporation (under their program to identify payees under retirement plans), and (c) the
payee has not responded within 6 months. If the Administrator is unable to locate such a person entitled to benefits
hereunder, or if there has been no claim made for such benefits, the Trust shall continue to hold the benefits due such
person.
Article XI. Relationship to Other Plans and Employment Agreements
This Plan serves in addition to any other retirement, pension, or benefit plan or system presently in existence or hereinafter
established for the benefit of the Employer's employees, and participation hereunder shall not affect benefits receivable under
any such plan or system. Nothing contained in this Plan shall be deemed to constitute an employment contract or agreement
22
'. between any Participant and the Employer or to give any Participant the right to be retained in the employ of the Employer.
Nor shall anything herein be construed to modifY the terms of any employment contract or agreement between a Participant
and the Employer.
Article XII. Amendment or Termination of Plan
The Employer may at any time amend this Plan provided that it transmits such amendment in writing to the Administrator at
least 30 days prior to the effective date of the amendment. The consent of the Administrator shall not be required in order for
such amendment to become effective, but the Administrator shall be under no obligation to continue acting as Administrator
hereunder if it disapproves of such amendment.
The Administrator may at any time propose an amendment to the Plan by an instrument in writing transmitted to the
Employer at least 30 days before the effective date of the amendment. Such amendment shall become effective unless, within
such 30-day period, the Employer notifies the Administrator 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.
The Employer may at any time terminate this Plan. In the event of termination, assets of the Plan shall be distributed to
Participants and Beneficiaries as soon as administratively practicable following termination of the Plan. Alternatively, assets of
the Plan may be transferred to an eligible deferred compensation plan maintained by another eligible governmental employer
within the same State if (a) all assets held by the Plan (other than Deemed IRAs) are transferred; (b) the receiving plan provides
for the receipt of transfers; (c) the Participants and Beneficiaries whose deferred amounts are being transferred will have an
amount immediately after the transfer at least equal to the deferred amount immediately before the transfer; and (d) the
Participants or Beneficiaries whose deferred amounts are being transferred is not eligible for additional annual deferrals in the
receiving plan unless the Participants or Beneficiaries are performing services for the employer maintaining the receiving plan.
Except as may be required to maintain the status of the Plan as an eligible deferred compensation plan under Section 457(b) of
the Code or to comply with other applicable laws, no amendment or termination of the Plan shall divest any Participant of any
rights with respect to compensation deferred before the date of the amendment or termination.
Article XIII. Applicable Law
This Plan and Trust shall be construed under the laws of the state where the Employer is located and is established with
the intent that it meet the requirements of an "eligible deferred compensation plan" under Section 457(b) of the Code, as
amended. The provisions of this Plan and Trust shall be interpreted wherever possible in conformity with the requirements of
that Section of the Code.
In addition, notwithstanding any provision of the Plan to the contrary, the Plan shall be administered in compliance with the
requirements of Section 414(u) of the Code.
Article:x:rv: 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.
23
DECLARATION OF TRUST
This Declaration of Trust (the "Group Trust Agreement") is made as of the 19th day of May, 2001, by VantageTrust Company,
which declares itself to be the sole Trustee of the trust hereby created.
WHEREAS, the ICMA Retirement Trust was created as a vehicle for the commingling of the assets of governmental plans
and governmental units described in Section 818(a)(6) of the Internal Revenue Code of 1986, as amended, pursuant to a
Declaration of Trust dated October 4, 1982, as subsequently amended, a copy of which is attached hereto and incorporated by
reference as set out below (the "ICMA Declaration"); and
WHEREAS, the trust created hereunder (the "Group Trust") is intended to meet the requirements of Revenue Ruling 81-
100, 1981-1 C.B. 326, and is established as a common trust fund within the meaning of Section 391: 1 of Title 35 of the New
Hampshire Revised Statutes Annotated, to accept and hold for investment purposes the assets of the Deferred Compensation
and Qualified Plans held by and through the ICMA Retirement Trust.
NO~ THEREFORE, the Group Trust is created by the execution of this Declaration of Trust by the Trustee and is established
with respect to each Deferred Compensation and Qualified Plan by the transfer to the Trustee of such Plan's assets in the
ICMA Retirement Trust, by the Trustees thereof, in accord with the following provisions:
(a) Incorporation of ICMA Declaration by Reference; ICMA By-Laws. Except as otherwise provided in this Group
Trust Agreement, and to the extent not inconsistent herewith, all provisions of the ICMA Declaration are
incorporated herein by reference and made a part hereof, to be read by substituting the Group Trust for the
Retirement Trust and the Trustee for the Board of Trustees referenced therein. In this respect, unless the
context clearly indicates otherwise, all capitalized terms used herein and defined in the ICMA Declaration
have the meanings assigned to them in the ICMA Declaration. In addition, the By-Laws of the ICMA
Retirement Trust, as the same may be amended from time-to-time, are adopted as the By-Laws of the Group
Trust to the extent not inconsistent with the terms of this Group Trust Agreement.
Notwithstanding the foregoing, the terms of the ICMA Declaration and By-Laws are further modified with
respect to the Group Trust created hereunder, as follows:
1. any reporting, distribution, or other obligation of the Group Trust vis-a-vis any Deferred
Compensation Plan, Qualified Plan, Public Employer, Public Employer Trustee, or Employer Trust
shall be deemed satisfied to the extent that such obligation is undertaken by the ICMA Retirement
Trust (in which case the obligation of the Group Trust shall run to the ICMA Retirement Trust); and
2. all provisions dealing with the number, qualification, election, term and nomination of Trustees shall
not apply, and all other provisions relating to trustees (including, but not limited to, resignation
and removal) shall be interpreted in a manner consistent with the appointment of a single corporate
trustee.
(b) Compliance with Revenue Procedure 81-100. The requirements of Revenue Procedure 81-100 are applicable to
the Group Trust as follows:
1. Pursuant to the terms of this Group Trust Agreement and Article X of the By-Laws, investment in the
Group Trust is limited to assets of Deferred Compensation and Qualified Plans, investing through the
ICMA Retirement Trust.
2. Pursuant to the By-Laws, the Group Trust is adopted as a part of each Qualified Plan that invests
herein through the ICMA Retirement Trust.
3. In accord with the By-Laws, that part of the Group Trust's corpus or income which equitably belongs
to any Deferred Compensation and Qualified Plan may not be used for or diverted to any purposes
other than for the exclusive benefit of the Plan's employees or their beneficiaries who are entitled to
benefits under such Plan.
1
,,"'
4. In accord with the By-Laws, no Deferred Compensation Plan or Qualified Plan may assign any or
part of its equity or interest in the Group Trust, and any purported assignment of such equity or
interest shall be void.
(c) Governing Law. Except as otherwise required by federal, state or local law, this Declaration of Trust (including
the ICMA Declaration to the extent incorporated herein) and the Group Trust created hereunder shall be
construed and determined in accordance with applicable laws of the State of New Hampshire.
(d) Judicial Proceedings. The Trustee may at any time initiate an action or proceeding in the appropriate state
or federal courts within or outside the state of New Hampshire for the settlement of its accounts or for the
determination of any question of construction which may arise or for instructions.
IN WITNESS WHEREOF, the Trustee has executed this Declaration of Trust as of the day and year first above written.
VANTAGETRUST COMPANY
By, ILl :fJ.~
Name: Paul F. Gallagher
Title:
Secretary
~~:,:..
2
RESOLUTION NO. 6-07
A RESOLUTION OF THE CITY COMMISSION OF THE CITY OF
DELRA Y BEACH, FLORIDA, ADOPTING THE ICMA RETIREMENT
COPRORATION GOVERNMENTAL MONEY PURCHASE PLAN
AND TRUST, PLAN NO. 10-9648, A 401A QUALIFIED
RETIREMENT PLAN AS AMENDED BY REJECTING AND
ACCEPTING CERTAIN ELECTIONS, TO BE EFFECTIVE
FEBRUARY 1, 2007; PROVIDING THAT THE ASSETS OF THE
PLAN SHALL BE HELD IN TRUST FOR THE EXCLUSIVE BENEFIT
OF PLAN PARTICIPANTS AND THEIR BENEFICIARIES;
PROVIDING AN EFFECTIVE DATE.
WHEREAS, the City of Delray Beach has previously established and maintains the ICMA
Retirement Corporation Governmental Money Purchase Plan and Trust, a 401 A Qualified Retirement Plan;
and,
WHEREAS, the ICMA-RC is using a negative election process wherein no notification is necessary
to ICMA-RC to take advantage of changes in the law; and,
WHEREAS, however, the City desires to make certain elections and reject others and therefore
adopts this resolution which adopts the amended and restated plan; and,
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF
DELRA Y BEACH, FLORIDA, AS FOLLOWS:
Section 1. That the City hereby amends and adopts the restated ICMA Retirement Corporation
401A Governmental Money Purchase Plan and Trust (the "Plan"), attached hereto and made a part hereof
as Appendix "A", as amended by the elections as set forth below.
Section 2.
12 or older.
That the Plan shall not permit in-service distributions to participants who are age 70
Section 3.
That the Plan shall not permit in-service distributions of roll over assets.
Section 4. That the Plan shall include pretax health care benefit contributions to an integral part
trust (excluding direct employer contributions) as part of an employees' gross income when calculating
plan contributions.
Section 5. That the Plan shall continue using the OJSA election which provides for a qualified
joint and survivor annuity (or life annuity, ifthe participant is single) and requires a written waiver with the
consent of the spouse.
Section 6. That the assets of the Plan shall be held in trust, with the City serving as Trustee, for
the exclusive benefit of the Plan participants and their beneficiaries, and the assets shall not be diverted to
any other purpose. The City hereby agrees to serve as trustee under the Plan. The Trustee's beneficial
ownership of Plan assets held in the Vantage Trust shall be held for the further exclusive benefit of the Plan
participants and their beneficiaries.
PASSED AND ADOPTED in regular session on this the _ day of
,2007.
MAYOR
ATTEST:
City Clerk
2
RES. NO. 6-07
ICMARC
Building Retirement Security
Appendix II All
GOVERNMENTAL MONEY PURCHASE PLAN & TRUST
I. PURPOSE
The Employer hereby adopts this Plan and Trust to provide funds for its Employees' retirement, 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 Participants and
their Beneficiaries.
II. DEFINITIONS
2.01 Account. A separate record which shall be established and maintained under the Trust for each Participant,
and which shall include all Participant sub accounts 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 adjustments 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 New York 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 (including a trust) designated by the Participant who 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 or no Beneficiary is otherwise designated by the
Participant, the Participant's Beneficiary shall be his/her surviving spouse or, if none, his/her estate.
Notwithstanding the foregoing, the Beneficiary designation is subject to the requirements of Article XII unless
the Employer elects otherwise in the Adoption Agreement.
'j~
i
ill
Notwithstanding the foregoing, where elected by the Employer in the Adoption Agreement (the "QJSA
Election"), the Beneficiary designation is subject to the requirements of Article XVII.
Notwithstanding the foregoing, to the extent permitted by the Employer, a Beneficiary receiving required
minimum distributions in accordance with Article X and not in a benefit form elected under Article XI or XII,
may designate a Beneficiary to receive the required minimum distributions that would have otherwise been
payable to the initial Beneficiary but for his or her death.
;it,!
'~~
1
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.
1
. 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 continuous 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 Contributions, are all of each
Participant's W-2 earnings which are actually paid to the Participant during the Plan Year, 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), 414(h)(2), 457(b), or,
effective January 1, 2001, 132(f)(4) of the Code. Earnings shall include any pre-tax contributions
(excluding direct employer contributions) to an integral part trust of the Employer providing retiree
health care benefits. Earnings shall also include any other earnings as defined and elected by the
Employer in the Adoption Agreement. Unless the Employer elects otherwise in the Adoption
Agreement, Earnings shall exclude overtime compensation and bonuses.
(b) Limitation on Earnings. For any Plan Year beginning after December 31, 2001, the annual Earnings of
each Participant taken into account in determining allocations shall not exceed $200,000, as adjusted
for cost-of-living increases in accordance with section 401(a)(17)(B) of the Code. Annual Earnings
means Earnings during the Plan Year or such other consecutive 12-month period over which Earnings
is otherwise determined under the Plan (the determination period). The cost-of-living adjustment in
effect for a calendar year applies to annual Earnings for the determination period that begins with or
within 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 the fraction, the
numerator of which is the number of months in the short Plan Year and the denominator of which
is twelve (12). If Earnings for any prior determination period are taken into account in determining
a Participant's allocations for the current Plan Year, the Earnings for such prior year are subject to the
applicable annual Earnings limit in effect for that prior year.
(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 allowed to be taken into account under the Plan as in effect on July 1, 1993, as
adjusted for increases in the cost-of-living in accordance with section 401 (a)(17)(B) of the Code. For
purposes of this Section, an eligible participant is an individual who first became a Participant in the
Plan during a Plan Year beginning before the first Plan Year beginning after December 31, 1993.
2.10 Effective Date. The first day of the Plan Year 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.
2.11 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
2
subsequently reclassified by a court of law or regulatory body as a common law employee of the Employer. For
purposes of clarification 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.
2.12 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.
2.13 Hour of Service. Each hour for which an Employee is paid or entitled to payment for the performance of du-
ties for the Employer.
2.14 Nonforfeitable Interest. The nonforfeitable interest of the Participant or his/her Beneficiary (whichever is
applicable) is that percentage of his/her Employer Contribution Account balance, which has vested pursuant to
Article VII. A Participant shall, at all times, have a one hundred percent (100%) Nonforfeitable Interest in his/
her Participant Contribution, Rollover, and Voluntary Contribution Accounts.
2.15 Normal Retirement Age. The age which the Employer specifies in the Adoption Agreement. If the Employer
enforces a mandatory retirement age, the Normal Retirement Age is the lesser of that mandatory age or the age
specified in the Adoption Agreement.
2.16 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 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 accordance 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 reemployment 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 will also receive credit for any Period of Severance ofless than twelve (12) consecutive months.
Fractional periods of a year will be expressed in terms of days.
Notwithstanding anything to the contrary herein, if the Plan is an amendment and restatement of a 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 if earlier, the twelve
(12) month anniversary of the date on which the Employee 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 person(s) or entity named to carry out certain nondiscretionary administrative
functions under the Plan, as hereinafter described, which is the ICMA Retirement Corporation or any successor
Plan Administrator.
2.21 Plan Year. The twelve (12) consecutive month period designated by the Employer in the Adoption Agreement.
2.22 Trust. The Trust created under Article VI of the Plan which shall consist of all of the assets of the Plan derived
from Employer and Participant contributions under the Plan, plus any income and gains thereon, less any
losses, expenses and distributions to Participants and Beneficiaries.
3
. III. I, ELIGIBILITY
3.01 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 commencing 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 as
Service for the Employer.
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 Agreement.
3.03 Return to Covered Employment Classification. In the event a Participant is no longer a member of Covered
Employment Classification and becomes ineligible to make contributions and/or have contributions made on
his/her behalf, such Employee will become eligible for contributions immediately upon returning to a Covered
Employment Classification. 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 otherwise 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.
IV: CONTRIBUTIONS
4.01 Employer Contributions. For each Plan Year, the Employer will contribute to the Trust an amount as
specified in the Adoption Agreement. The Employer's full contribution for any Plan Year shall be due and paid
not later than thirty (30) working days after the close of the Plan Year. 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 Contributions otherwise required under
the Plan for the current Plan Year and succeeding Plan Years, 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 rate prescribed by the Employer or at any of a range of specified rates,
as set forth by the Employer in the Adoption Agreement, as a requirement for his/her participation in the Plan.
Once an eligible Employee becomes a Participant, 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.
4
If the Employer so elects in the Adoption Agreement, the Mandatory Participant Contributions shall be
"picked up" by the Employer in accordance with Code section 414(h)(2). Any contribution picked-up under
this Section shall be treated as an employer contribution in determining the tax treatment under the Code, and
shall not be included as gross income of the Participant until it is distributed.
4.04 Employer Matching Contributions of Voluntary Participant Contributions. If the Employer so elects in
the Adoption Agreement, Employer Matching Contributions shall be made on behalf of an eligible Employee
for a Plan Year only if the Employee agrees to make Voluntary Participant Contributions for that Plan Year.
The rate of Employer Contributions shall, to the extent specified in the Adoption Agreement, be based upon
the rate at which Voluntary Participant Contributions are made for that Plan Year. Employer Matching
Contributions shall be accounted for separately in the Employer Contribution Account.
4.05 Voluntary Participant Contributions. If the Employer so elects in the Adoption Agreement, an eligible
Employee may make after-tax voluntary (unmatched) contributions under the Plan for any Plan Year in any
amount up to twenty five percent (25%) of his/her Earnings for such Plan Year. Matched and unmatched
contributions shall be accounted for separately in the Participant's Voluntary Contribution Account. Such
Account shall be at all times nonforfeitable by the Participant.
4.06 Deductible Employee Contributions. The Plan will not accept deductible employee contributions which
are made for a taxable year beginning after December 31, 1986. Contributions made prior to that date will be
maintained in a Deductible Employee Contribution Account. 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, effective
December 12, 1994, contributions, benefits and service credit with respect to qualified military service will be
provided in accordance with section 414(u) of the Code.
Effective December 12, 1994, if the Employer has elected in the Adoption Agreement to make loans available
to Participants, 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 Voluntary Participant
Contributions at any time or during an election period as designated by the Employer. A Participant may
discontinue such contributions at any time or during an election period as designated by the Employer.
4.09 Portability of Benefits.
(a) Unless otherwise elected by the Employer in the Adoption Agreement, the Plan will accept
Participant (which shall include, for purposes of this subsection, an Employee within the Covered
Employment Classification whether or not he/she has satisfied the minimum age and service
requirements of Article III,) rollover contributions and/or direct rollovers of distributions (including
after-tax contributions) made after December 31,2001 that are eligible for rollover in accordance
with Section 402(c), 403(a)(4), 403(b)(8), 408(d)(3)(A)(ii), or 457(e)(16) of the Code, from all of
the following types of plans:
(1) A qualified plan described in Section 401 (a) or 403(a) of the Code;
(2) An annuity contract described in Section 403(b) of the Code;
(3) An eligible plan under Section 457(b) of the Code which is maintained by a state, ~~li:ical
subdivision of a state, or any agency or instrumentality of a state or a political subdIVISion of
a state; and
5
..~: --
(4) An individual retirement account or annuity described in Section 408(a) or 408 (b) of the
Code (including SEPs, and SIMPLE IRAs after two years of participating in the SIMPLE
IRA).
(b) Notwithstanding the foregoing, the Employer may reject the rollover contribution if it determines,
in its discretion, that the form and nature of the distribution from the other plan does not satisfy the
applicable requirements under the Code to make the transfer or rollover a nontaxable transaction to
the Participant;
(c) For indirect rollover contributions, the amount distributed from such plan must be rolled over to
this Plan no later than the sixtieth (60th) day after the distribution was made from the plan, unless
otherwise waived by the IRS pursuant to Section 402(c)(3) of the Code.
(d) The amount transferred shall be deposited in the Trust and shall be credited to a Rollover
Account. Such Account shall be one hundred percent (100%) vested in the Participant.
(e) The Plan will accept accumulated deductible employee contributions as defined in section
72(0)(5) of the Code that were distributed from a qualified retirement plan and transferred (rolled
over) pursuant to section 402(c), 403(a)(4), 403(b)(8), 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 Employee Contributions Account. Such Account shall be one-hundred percent (100%)
vested in the Participant.
(f) A Participant 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 irrevocable 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 attributes 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 of contribution.
'V, LIMITATION ON ALLOCATIONS
5.01 Participants Only in This 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, 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 Limitation Year will not exceed the lesser of the Maximum 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 Limitation Year to exceed the Maximum Permissible Amount, the amount contributed or al-
located will be reduced so that the Annual Additions for the Limitation Year will equal the Maximum
Permissible Amount.
(b)
Prior to determining the Participant's actual Compensation for the Limitation Year, 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.
~-
\,-
-~<
-
6
(1) Any Mandatory Participant Contributions that are not "picked up" by the Employer or
Voluntary Participant Contributions, to the extent they would reduce the Excess Amount, will
be returned to the Participant;
(c) As soon as is administratively feasible after the end of the Limitation Year, the Maximum Permissible'
Amount for the Limitation Year will be determined on the basis of the Participant's actual Compensa_
tion for the Limitation Year.
(d) If, as a result of an inadvertent reasonable error in estimating the Maximum Permissible AmoUnt for
a Participant in accordance with Subsection (b) or 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:
(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 Limitation Year, the Excess Amount in the Partici-
pant's Account will be used to reduce Employer Contributions (including any allocation of
forfeitures) for such Participant in the next Limitation Year, and each succeeding Limitation
Year 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 Limitation Year, the Excess Amount will be held
un allocated 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 Limitation Year, and each succeeding Limitation Year if necessary;
(4) If a suspense account is in existence at any time during a particular Limitation Year, all
amounts in the suspense account must be allocated and reallocated to Participants' accounts
before any Employer or any Employee contributions may be made to the Plan for that Limita-
tion Year. Excess Amounts in a suspense account may not be distribured to Participants or
former Participants.
5.02 Participants in Another Defined Contribution Plan.
(a) Unless the Employer provides other limitations in the Adoption Agreement, this Section applies if,
in addition to this Plan, the Participant is covered under another qualified defined contribution plan
maintained by the Employer, or a welfare benefit fund, as defined in section 419(e) of the Code,
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, during any Limitation
Year. The Annual Additions which may be credited to a Participant's Account under this Plan for
any such Limitation Year will not exceed the Maximum Permissible Amount reduced by the Annual
Additions credited to a Participant's Account under the other plans and welfare benefit funds for the
same Limitation Year. If the Annual Additions with respect to the Participant under other defined
contribution plans and welfare benefit funds maintained by the Employer are less than the Maximum
Permissible Amount and the Employer contribution that would otherwise be contributed or allocated
to the Participant's Account under this Plan would cause the Annual Additions for the Limitation
Year to exceed this limitation, the amount contribured or allocated will be reduced so that the Annual
Additions under all such plans and funds for the Limitation Year will equal the Maximum Permissible
Amount. If the Annual Additions with respect to the Participant under such other defined contribU-
tion plans and welfare benefit funds in the aggregate are equal to or greater than the Maximum Per-.
missible Amount, no amount will be contributed or allocated to the Participant's Account under thiS
Plan for the Limitation Year.
(b) Prior to determining the Participant's actual Compensation for the Limitation Year, the Employer may
determine the Maximum Permissible Amount for a Participant in the manner described in Section
5.01(b).
7
(c) As soon as is administratively feasible after the end of the Limitation Year, the Maximum Permissible
Amount for the Limitation Year will be determined on the basis of the Participant's actual Compensa-
tion for the Limitation Year.
(d) If, pursuant to Subsection (c) or as a result of the allocation of forfeitures, a Participant's Annual
Additions under this Plan and such other plans would result in an Excess Amount for a Limitation
Year, the Excess Amount will be deemed to consist of the Annual Additions last allocated, except that
Annual Additions attributable to a welfare benefit fund or individual medical account will be deemed
to have been allocated first regardless of the actual allocation date.
(e) If an Excess Amount was allocated to a Participant on an allocation date of this Plan which coincides
with an allocation date of another plan, the Excess Amount attributed to this Plan will be the product
of,
(1) The total Excess Amount allocated as of such date, multiplied by the ratio of:
(i) the Annual Additions allocated to the Participant for the Limitation Year as of such date
under this Plan to
(ii) the total Annual Additions allocated to the Participant for the Limitation Year as of such
date under this and all the other prototype qualified defined contribution plans.
(f) Any Excess Amount attributed to this Plan will be disposed in the manner described in Section
5.01(d).
5.03 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 Limita-
tion Year:
(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 defined 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 contribution plan.
For this purpose, any Excess Amount applied under Sections 5.01(d) or 5.02(f) in the Limitation Year
to reduce Employer Contributions will be considered Annual Additions for such Limitation Year.
(b) 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. Reg.
section 1.62-2(c))), and 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
8
(i) any elective deferrals (as defined in section 402(g) (3) of the Code), and
under a simplified employee pension plan to the extent such contributions are deductibl~
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 Employ
(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, Compensation shall include:
(ii) 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, 132(f)(4) or 457 of the Code.
For purposes of applying the limitations of this Article, Compensation for a Limitation Year is the
Compensation actually paid or made available during such year.
(c) Defined Contribution Dollar Limitation: $40,000, as adjusted for increases in the cost-of-living in
accordance with section 415(d) of the Code.
(d) Employer: The Employer that adopts this Plan.
(e) Excess Amount: The excess of the Participant's Annual Additions for the Limitation Year over the
Maximum Permissible Amount.
Any Excess Amount shall include allocable income. The income allocable to an Excess Amount is
equal to the sum of allocable gain or loss for the Plan Year and the allocable gain or loss for the period
between the end of the Plan Year and the date of distribution (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 Plan Year, and is used by the Plan for allocating income to Participants' Accounts.
(f) Limitation rear: 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
Limitation Year. If the Limitation Year is amended to a different twelve (12) consecutive month
period, the new Limitation Year must begin on a date within the Limitation Year in which the amend-
ment is made.
(g) Maximum Permissible Amount: The maximum Annual Addition that may be contributed 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) One hundred percent (100%) (25% for Limitation Years before January 1, 2002) of the
Participant's Compensation for the Limitation Year.
The compensation limit referred to in (2) shall not apply to any contribution for medical benefits after
separation from service (within the meaning of section 401 (h) or section 419A(f)(2) of the Code)
which is otherwise treated as an annual addition.
9
If a short Limitation Year is created because of an amendment changing the Limitation Year to a differ-
ent twelve (12) consecutive month period, the Maximum Permissible Amount will not exceed the
Defined Contribution Dollar Limitation multiplied by the following fraction:
Number of months in the short Limitation Year / 12
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 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, notes,
debentures, mortgages, 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 reasonable 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.
(b) To invest and reinvest all or any part of the assets of the Trust in any common, collective or com-
mingled 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 of the Trust in any group annuity, deposit
administration or guaranteed interest contract issued by an insurance company 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 Administrator 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.
(d) 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 foregoing, 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 deposited, 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.
10
6.06
6.07
(g) To employ suitable consultants, depositories, agents, and legal counsel on behalf of the Plan.
(f) Upon such terms as may be deemed advisable by the Employer or the Plan Administrator, as
may be, for the protection of the interests of the Plan or for the preservation of the value of an
ment, to exercise and enforce by suit for legal or equitable remedies or by other action, or to waF
any right or claim on behalf of the Plan or any default in any obligation owing to the Plan, to re
extend the time for payment of, agree to a reduction in the rate of interest on, or agree to any 0
modification or change in the terms of any obligation owing to the Plan, to settle, compromise,
or submit to arbitration any claim or right in favor of or against the Plan, to exercise and enforce';
and all rights of foreclosure, bid for property in foreclosure, and take a deed in lieu of foreclosure'
or without paying consideration 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 proce'
in any court of law or equity or before any body or tribunal.
(h) To open and maintain any bank account or accounts in the name of the Plan, the Employer, or
nominee or agent of the foregoing, including the Plan Administrator, 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.
6.03
Taxes and Expenses. All taxes of any and all kinds whatsoever that may be levied or assessed under existin
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 fro
the Trust. Such reasonable compensation of the Plan Administrator, as may be agreed upon from time to ti
by the Employer and the Plan Administrator, and reimbursement for reasonable expenses incurred by the PI
Administrator 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 ERISA 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.
6.04
Payment of Benefits. The payment of benefits from the Trust in accordance with the terms of the Plan may
made by the Plan Administrator, or by any custodian or other person so authorized by the Employer to make
such disbursement. Benefits under this Plan shall be paid only if the Plan Administrator, custodian or other
person decides in his/her discretion that the applicant is entitled to them. 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.
6.05
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
collectibles, as defined in section 408(m) of the Code.
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 t~e
immediately preceding Accounting Date bears to the total of all such Account balances as of that Accounting
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.
11
~"..,~~.diia
',VII. " VESTING
7.01 Vesting Schedule. The portion of a Participant's Account attributable to Mandatory Participant Contribu-
tions and Voluntary Participant Contributions, 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
Contribution Account established under Section 4.01 and 4.04 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 nonforfeitable percentage in the Employee's Account balance
derived from Employer Contributions. If the Employer 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 the purposes of computing a Participant's
nonforfeitable 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 consecutive one (1) year Breaks in Service will
not be taken into account in computing eligibility service if the number of consecurive 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. If a 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 Participant shall have a
Nonforfeitable Interest 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, ifhe/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 Interest 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 provided 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
12
the provisions of Section 9.04 to have received, distribution of the entire Nonforfeitable Interest in his/he
Employer Contribution Account.
No forfeiture will occur solely as a result of a Participant's withdrawal of Employee Contributions.
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 inc
Break in Service of five (5) consecutive years, any amounts forfeited pursuant to Section 7.06 shall be reinsci.l~
to the Participant's Employer Contribution Account on the date of repayment by the Participant of the amo~(
distributed to such Participant from his/her Employer Contribution Account; provided, however, that if sud}
Participant forfeited his/her Account balance by reason of a deemed distribution, pursuant to Section 9.04, sll
amounts shall be automatically restored upon the reemployment of such Participant. Such repayment mustbif
made before the earlier of five (5) years after the first date on which the Participant is subsequently reemploye
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 or Beneficiary shall notify the Plan Administrator 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 or Beneficiary.
8.02 Appeal Procedure. If any claim for benefits is initially denied by the Plan Administrator, the claimant shall file
the appeal with the Employer, 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 incurs
a severance from employment (separation from service for Plan Years beginning before 2002) for any other
reason may elect by written notice to the Plan Administrator to have his or her vested Account balance benefits
commence on any date, provided that such distribution complies with Section 9.02. Such election must be
made in writing during the ninety (90) day period ending on the date as of which benefit payments are to
commence. A Participant's election shall be revocable and may be amended by the Participant.
The failure of a Participant 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 Restrictions 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 is at least $1,000, and the Account balance is
immediately distributable, the Participant must consent to any distribution of such Account balance. The
Participant's consent shall be obtained in writing during the ninety (90) day period ending on the date as
of which benefit payments are to commence. No consent shall be required, however, to the extent that a
distribution is required to satisfy section 401 (a) (9) or 415 of the Code.
The Plan Administrator shall notify the Participant of the right to defer any distribution until the Parti~ip.ant's
Account balance is no longer immediately distributable. Such notification shall include a general descnptIon
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 payments are to com~ence.
However, distribution may commence less than thirty (30) days after the notice described in the precedmg
sentence is given, provided (i) the distribution is one to which sections 401 (a) (11) and 417 of the C~de do not
apply or, if the QJSA Election is made by the Employer in the Adoption Agreement, the waiver requ~r:ments
of Section 17.04(a) are met; (ii) the Plan Administrator clearly informs the Participant that the PartICIpant
.~~
13
..'
has a right to a period of at least thirty (30) days after receiving the notice to consider the decision of whether
or not to elect a distribution (and, if applicable, a particular distribution option); and (iii) the Participant, after
receiving the notice, affirmatively elects a distribution.
In addition, upon termination of this Plan if the Plan does not offer an annuity option (purchased from a
commercial provider) and if the Employer does not maintain another 401 (a) defined contribution plan, the
Participant's Account balance will, without the Participant's consent, be distributed to the Participant in a lump
sum. However, if the Employer maintains another 401 (a) defined contribution plan, the Participant's Account
balance will be transferred, without the Participant's consent, to the other plan if the Participant does not
consent to an immediate distribution.
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 Retirement Age or age sixty-two (62).
For purposes of determining the applicability of the foregoing consent requirements to distributions made
before 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(0)(5)(B) of the Code.
9.03 Transfer to Another Plan.
(a) If a Participant becomes eligible to participate in another plan maintained by the Employer that is
qualified under section 401 (a) of the Code, the Plan Administrator shall, at the written election of
such Participant, transfer all or part of such Participant's Account to such plan, provided the plan
administrator for such plan certifies to the Plan Administrator that its plan provides for the acceptance
of such a transfer. Such transfers shall include those transfers of the nonforfeitable interest of a
Participant's Account made for the purchase of service credit in defined benefit plans maintained by
the Employer. For purposes of this Plan, any such transfer shall not be considered a distribution to the
Participant subject to spousal consent as described in Section 9.10.
(b) Notwithstanding any provision of the Plan to the contrary that would otherwise limit a Distributee's
election under this Section, a Distributee may elect, at the time and in the manner prescribed by the
Plan Administrator, to have any portion of an Eligible Rollover Distribution paid directly to an Eligible
Retirement Plan specified by the Distributee in a Direct Rollover.
(c) Definitions. For the purposes of Subsection (b), the following definitions shall apply:
(1) Eligible Rollover Distribution. Any distribution of all or any portion of the balance to the
credit of the Distributee, except that an Eligible Rollover Distribution does not include:
(i) any distribution that is one of a series of substantially equal periodic payments (not
less frequently than annually) made for the life (or life expectancy) of the Distributee
or the joint lives (or joint life expectancies) of the Distributee and the Distributee's
designated beneficiary, or for a specified period of ten years or more;
(ii) any distribution to the extent such distribution is required under section 401 (a) (9)
of the Code; and
(iii) the portion of any other distribution(s) that is not includible in gross income.
A portion of a distribution shall not fail to be an eligible rollover distribution merely
because the portion consists of after-tax employee contributions which are not includible
in gross income. However, such portion may be transferred only to an individual
retirement account or annuity described in section 408(a) or (b) of the Code, or to a
14
qualified defined contribution plan described in section 401 (a) or 403(a) of the Code that
agrees to separately account for amounts so transferred, including separately accounting
for the portion of such distribution which is includible in gross income and the portion of
such distribution which is not so includible.
(2) Eligible Retirement Plan.
(i) an individual retirement account described in section 408(a) of the Code or an
individual retirement annuity described in section 408(b) of the Code (collectively,
an "IRA");
(ii) an annuity plan described in section 403(a) of the Code;
(iii) an annuity contract described in section 403(b) of the Code,
(iv) an eligible plan under section 457(b) of the Code which is maintained by a state,
political subdivision of a state, or any agency or instrumentality of a state or political
subdivision of a state and which agrees to separately account for amounts transferred
into such plan from this Plan; or
(v) a qualified plan described in section 401 (a) of the Code, that accepts the
Distributee's Eligible Rollover Distribution. The definition of Eligible Retirement
Plan shall also apply in the case of a distribution to a surviving spouse, or to a spouse
or former spouse who is the alternate payee, under a qualified domestic relations
order, as defined in section 414(p) of the Code.
(3) Distributee. Participant; in addition, the Participant's surviving spouse and the
spouse or former 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
of the spouse or former spouse.
(4) Direct Rollover. A payment by the Plan to the Eligible Retirement Plan specified by the
Distributee.
9.04 De Minimis Accounts. Notwithstanding the foregoing provisions of this Article, prior to January I, 2002, if a
Participant terminates service, and the value of his/her Nonforfeitable Interest in his/her Account is not greater
than the dollar limit under section 411 (a) (I I)(A) of the Code, the Participant's benefit shall be paid (to the
extent it constitutes an Eligible Rollover Distribution) in the form of a direct rollover to the Plan Administrator's
designated IRA, unless he/she affirmatively elects to receive a cash payment or a Direct Rollover in accordance
with procedures established by the Plan Administrator.
On or after January I, 2002, if a Participant terminates service, and the value of his/her Nonforfeitable Interest
in his/her Account is less than $1,000, the Participant's benefit shall be paid as soon as practicable to the
Participant in a single lump sum distribution. If the value of the Participant's Account is at least $1,000 but not
more than the dollar limit under section 411 (a) (1 1 )(A) of the Code, the Participant may elect to receive his/her
Nonforfeitable Interest in his/her Account. Such distribution shall be made as soon as practicable following the
request, in a lump sum.
For purposes of this Section, if a Participant's Nonforfeitable Interest in his/her Account is zero, the Participant
shall be deemed to have received a distribution of such Nonforfeitable Interest in his/her Account.
9.05 Withdrawal of Voluntary Contributions. A Participant may upon written request withdraw a part of or the
full amount of his/her Voluntary 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.
15
" 9.06 Withdrawal of Deductible Employee Contributions. A Participant may upon written request withdraw a
part of or the full amount of his/her 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 calendar year.
No forfeiture will occur solely as the result of any such withdrawal.
9.07 In-Service Distribution from Rollover Account. Where elected by the Employer in the Adoption Agreement,
a Participant that has a separate account attributable to rollover contributions to the Plan, may at any time elect
to receive a distribution of all or any portion of the amount held in the Rollover Account.
9.08 In-Service Distributions. Unless otherwise elected by the Employer in the Adoption Agreement, a Participant
who has reached age 70-1/2 regardless of his Nonforfeitable Interest in his/her entire Employer Contribution
Account, shall, upon written request, receive a distribution of a part of or the full amount of the balance in any
or all of his vested Accounts. Such distributions may be requested at any time, provided that no more than two
(2) such distributions may be made during any calendar year.
9.09 Latest Commencement of Benefits. Notwithstanding anything to the contrary in this Article, benefits shall
begin no later than the Participant's Required Beginning Date, as defined under Section 10.05, or as otherwise
provided in Section 10.04.
9.10 Spousal Consent. Notwithstanding the foregoing, if the Employer elected the Q]SA Election in the Adoption
Agreement, a married Participant must first obtain his or her spouse's notarized consent to request a distribution
(other than a Qualified Joint and Survivor Annuity), withdrawal, or rollover under this Article IX.
X. DISTRIBUTION REQUIREMENTS
10.01 General Rules.
(a) Subject to the provisions of Article XII or XVII if so elected by the Employer in the Adoption
Agreement, the requirements of this Article shall apply to any distribution of a Participant's interest
and will take precedence over any inconsistent provisions of this Plan. Unless otherwise specified, the
provisions of this Article X apply to calendar years beginning after December 31, 2002.
With respect to distributions under the Plan made in or for Plan Years beginning on or after January
1, 2002 and prior to January 1, 2003, the Plan will apply the minimum distribution requirements of
section 401 (a) (9) of the Code in accordance with the regulations under section 401(a)(9) that were
proposed on January 17, 2001, notwithstanding any provision of the Plan to the contrary.
(b) All distributions required under this Article shall be determined and made in accordance with the
regulations under section 401(a)(9) of the Code, and the minimum distribution incidental benefit
requirement of section 40 l(a)(9) (G) of the Code.
(c) Limits on Distribution Periods. As of the first Distribution Calendar Year, distributions to a
Participant, if not made in a single-sum, may only be made over one of the following periods:
(1) The life of the Participant; or
(2) The joint lives of the Participant and a designated Beneficiary; or
(3) A period certain not extending beyond the life expectancy of the Participant; or
(4) A period certain not extending beyond the joint and last survivor expectancy of the Participant
and a designated Beneficiary.
16
(d) TEFRA Section 242(b)(2) Elections. Notwithstanding the other provisions of this Article XVII,
distributions may be made under a designation made before January 1, 1984, in accordance with
Section 242(b)(2) of the Tax Equity and Fiscal Responsibility Act (TEFRA) and the provisions of the
Plan that relate to Section 242(b)(2) ofTEFRA.
10.02 Time and Manner of Distribution
(a) Required Beginning Date. The Participant's entire interest will be distributed, or begin to be
distributed, to the Participant no later than the Participant's required beginning date.
(b) Death o/Participant Before Distributiom Begin. If the Participant dies before distributions begin, the
Participant's entire interest will be distributed, or begin to be distributed, no later than as follows:
(1) If the Participant's surviving spouse is the Participant's sole designated Beneficiary, then,
distributions to the surviving spouse will begin by December 31 of the calendar year
immediately following the calendar year in which the Participant died, or by December 31
of the calendar year in which the Participant would have attained age 70 1/2, iflater.
(2) If the Participant's surviving spouse is not the Participant's sole designated Beneficiary, then
distributions to the designated Beneficiary will begin by December 31 of the calendar year
immediately following the calendar year in which the Participant died.
(3) If there is no designated Beneficiary as of September 30 of the year following the year of the
Participant's death, the Participant's entire interest will be distributed by December 31 of the
calendar year containing the fifth anniversary of the Participant's death.
(4) If the Participant's surviving spouse is the Participant's sole designated Beneficiary and the
surviving spouse dies after the Participant but before distributions to the surviving spouse
begin, this Section 1O.02(b), other than Section 1O.02(b)(1), will apply as if the surviving
spouse were the Participant.
For purposes of this Section 1O.02(b) and Section 10.04, unless Section 1O.02(b)(4) applies,
distributions are considered to begin on the Participant's required beginning date. If Section
1O.02(b)(4) applies, distributions are considered to begin on the date distributions are required to
begin to the surviving spouse under Section 1O.02(b)(1). If distributions under an annuity purchased
from an insurance company irrevocably commence to the Participant before the Participant's required
beginning date (or to the Participant's surviving spouse before the date distributions are required to
begin to the surviving spouse under Section 10.02(b)(1)), the date distributions are considered to
begin is the date distributions actually commence.
(c) Forms o/Distribution. Unless the Participant's interest is distributed in the form of an annuity
purchased from an insurance company or in a single sum on or before the required beginning date,
as of the first distribution calendar year distributions will be made in accordance with Sections 10.03
and 10.04. If the Participant's interest is distributed in the form of an annuity purchased from an
insurance company, distributions thereunder will be made in accordance with the requirements of
Code Section 401 (a) (9) and the Treasury Regulations.
10.03 Required Minimum Distributions During Participant's Lifetime
(a) Amount a/Required Minimum Distribution For Each Distribution Calendar lear. During the
Participant's lifetime, the minimum amount that will be distributed for each distribution calendar
year is the lesser of:
(1) The quotient obtained by dividing the Participant's Account Balance by the distribution
17
period set forth in the Uniform Lifetime Table found in Section 1.401 (a) (9)-9, Q&A-2, of
the Final Income Tax Regulations using the Participant's age as of the Participant's birthday
in the distribution calendar year; or
(2) If the Participant's sole designated Beneficiary for the distribution calendar year is the
Participant's spouse, the quotient obtained by dividing the Participant's Account Balance by
the number in the Joint and Last Survivor Table set forth in Section 1.401(a)(9)-9, Q&A-3,
of the regulations using the Participant's and spouse's attained ages as of the Participant's and
spouse's birthdays in the distribution calendar year.
(b) Lifetime Required Minimum Distributions Continue Through rear ofParticipant's
Death. Required minimum distributions will be determined under this Section
10.03 beginning with the first distribution calendar year and continuing up to, and
including, the distribution calendar year that includes the Participant's date of death.
Required Minimum Distributions After Participant's Death
(a) Death On or After Date Distributions Begin.
(1) Participant Survived by Designated Beneficiary. If the Participant dies on or after the date
distributions begin and there is a designated Beneficiary, the minimum amount that will
be distributed for each distribution calendar year after the year of the Participant's death
is the quotient obtained by dividing the Participant's Account Balance by the longer of
the remaining life expectancy of the Participant or the remaining life expectancy of the
Participant's designated Beneficiary, determined as follows:
(i) The Participant's remaining life expectancy is calculated using the age of the
Participant in the year of death, reduced by one for each subsequent year.
(ii) If the Participant's surviving spouse is the Participant's sole designated Beneficiary,
the remaining life expectancy of the surviving spouse is calculated for each
distribution calendar year after the year of the Participant's death using the surviving
spouse's age as of the spouse's birthday in that year. For distribution calendar years
after the year of the surviving spouse's death, the remaining life expectancy of
the surviving spouse is calculated using the age of the surviving spouse as of the
spouse's birthday in the calendar year of the spouse's death, reduced by one for each
subsequent calendar year.
(iii) If the Participant's surviving spouse is not the Participant's sole designated
Beneficiary, the designated Beneficiary's remaining life expectancy is calculated using
the age of the Beneficiary in the year following the year of the Participant's death,
reduced by one for each subsequent year.
(2) No Designated Beneficiary. If the Participant dies on or after the date distributions begin
and there is no designated Beneficiary as of September 30 of the year after the year of the
Participant's death, the minimum amount that will be distributed for each distribution
calendar year after the year of the Participant's death is the quotient obtained by dividing the
Participant's Account Balance by the Participant's remaining life expectancy calculated using
the age of the Participant in the year of death, reduced by one for each subsequent year.
(b) Death Before Date Required Distributions Begin.
(1) Participant Survived by Designated Beneficiary. If the Participant dies before the date required
distributions begin and there is a designated Beneficiary, the minimum amount that will
be distributed for each distribution calendar year after the year of the Participant's death is
18
the quotient obtained by dividing the Participant's Account Balance by the remaining life
expectancy of the Participant's designated Beneficiary, determined as provided in Section
1O.04(a).
(2) No Designated Beneficiary. If the Participant dies before the date distributions begin and
there is no designated Beneficiary as of September 30 of the year following the year of the
Participant's death, distribution of the Participant's entire interest will be completed by
December 31 of the calendar year containing the fifth anniversary of the Participant's death.
(3) Death of Surviving Spouse Before Distributions to Surviving Spouse Are Required to Begin. If
Participant dies before the date distributions begin, the Participant's surviving spouse is the
Participant's sole designated Beneficiary, and the surviving spouse dies before distributions ar
required to begin to the surviving spouse under Section 10.02(b)(l), this Section 1O.04(b)
will apply as if the surviving spouse were the Participant.
10.05 Definitions
(a) Designated Beneficiary. The individual who is designated by the Participant (or the Participant's
surviving spouse) as the Beneficiary of the Participant's interest under the Plan and who is the
designated Beneficiary under Code Section 401 (a) (9) and Section 1.401 (a) (9)-4 of the regulations.
(b) Distribution Calendar lear. A calendar year for which a minimum distribution is required. For
distributions beginning before the Participant's death, the first distribution calendar year is the
calendar year immediately preceding the calendar year which contains the Participant's required
beginning date. For distributions beginning after the Participant's death, the first distribution
calendar year is the calendar year in which distributions are required to begin under Section 10.02(b).
The required minimum distribution for the Participant's first distribution calendar year will be made
on or before the Participant's required beginning date. The required minimum distribution for other
distribution calendar years, including the required minimum distribution for the distribution calendar
year in which the Participant's required beginning date occurs, will be made on or before December
31 of that distribution calendar year.
(c) Life Expectancy. Life expectancy as computed by use of the Single Life Table in Section 1.401 (a) (9)-
9, Q&A-1, of the regulations.
(d) Participants Account Balance. The Account Balance as of the last Accounting Date in the calendar
year immediately preceding the distribution calendar year (valuation calendar year) increased by the
amount of any contributions made and allocated or forfeitures allocated to the Account Balance as of
dates in the valuation calendar year after the Accounting Date and decreased by distributions made
in the valuation calendar year after the Accounting Date. The Account Balance for the valuation
calendar year includes any amounts rolled over or transferred to the Plan either in the valuation
calendar year or in the distribution calendar year if distributed or transferred in the valuation calendar
year.
(e) Required Beginning Date. The Required Beginning Date of a Participant is April 1 of the calendar
year following the later of the calendar year in which the Participant attains age seventy and one-half
(70-1/2), or the calendar year in which the Participant retires.
XI. MODES OF DISTRIBUTION OF BENEFITS
11.01 Normal Mode of Distribution. Unless an elective mode of distribution is elected as provided in Section
11.02, benefits shall be paid to the Participant in the form of a lump sum payment.
Notwithstanding the foregoing, where the Employer made the "QJSA Election" in the Adoption Agreement,
unless an elective mode of distribution is elected in accordance with Article XVII, benefits shall be paid to the
Participant in the form provided for in Article XVII.
19
11.02 Elective Mode of Distribution. Subject to the requirements of Articles X, XII and XVII, a Participant may
revocably elect to have his/her Account distributed in anyone (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) Period Certain. Approximately equal monthly, quarterly, semi-annual, or annual payments, calculated
to continue for a period certain chosen by the Participant.
(c) Other. Any other sequence of payments requested by the Participant.
(d) Lump Sum. Where the Employer did make the Q]SA Election in the Adoption Agreement, a
Participant may also elect a lump sum payment.
11.03 Election of Mode. A Participant's election of a 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 Article X (and Article XII or XVII if so elected by the Employer in the
Adoption Agreement),
(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 Sec-
tion may elect to have benefits commence at a later date, subject to the provisions of Article X. The
Beneficiary may elect to receive the death benefit in any of the forms available to the Participant
under Sections 11.01 and 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.
(b) 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.
SPOUSAL DEATH BENEFIT REQUIREMENTS
12.01 Application. Unless otherwise elected by the Employer in the Adoption Agreement, on or after January 1,
2006, the provisions of this Article shall take precedence over any conflicting provision in this Plan. The
provisions of this Article, known as the "Beneficiary Spousal Consent Election," 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 12.04.
12.02 Spousal Death Benefit.
(a) On the death of a Participant, the Participant's Vested Account Balance will be paid to the
Participant's Surviving Spouse. If there is no Surviving Spouse, or if the Participant has waived the
spousal death benefit, as provided in Section 12.03, such Vested Account Balance will be paid to the
Participant's designated Beneficiary.
(b) The Surviving Spouse may elect to have distribution of the Vested Account Balance commence
within the ninety (90) day period following the date of the Participant's death, or as otherwise
provided under Section 11.04. The Account balance shall be adjusted for gains or losses occurring
after the Participant's death in accordance with the provisions of the Plan governing the adjustment of
Account balances for other types of distributions.
20
, 12.03 Waiver of Spousal Death Benefit.
.,
The Participant may waive the spousal death benefit described in Section 12.02 at any time; provided that no
such waiver shall 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
Beneficiaries, 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 consent is witnessed by a Plan representative or notary public. 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 to meet the requirements of this Section.
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 requirement 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 of benefit 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.
12.04 Definitions. For the purposes of this Section, the following definitions shall apply:
(a) 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; and
(b) 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 Participant who is vested in amounts attributable to Employer Contributions,
Employee contributions (or both) at the time of death or distribution.
XIII. LOANS TO PARTICIPANTS
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 limitations and other provisions of this
Article.
(b) 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 equivalent basis.
21
1i.
..
(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) Foreclosure. In the event of default, foreclosure on the note and attachment of security will not occur
until a distributable event occurs in the Plan.
(f) Reduction of Account. 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 aCCount 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 loan. Ifless 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 reducing the nonforfeitable Account bal-
ance by the amount of the security used as repayment of the loan, and then determining the benefit
payable to the surviving spouse.
(g) 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 lesser of:
(1) $50,000, reduced by the excess (if any) of
(i) 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
(ii) The outstanding balance of loans from the Plan on the date on which such loan is
made; or
(2) One-half (1/2) of the value of the Participant's Nonforfeitable Interest in all of his/her
Accounts under this Plan (or $10,000, if greater, for loans prior to January 1, 2006).
For the purpose of the above limitation, all loans from all qualified employer plans, including 457(b)
plans, under Code section 72(p)(4) of the Code are aggregated.
(h) 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.
(i) Length of Loan. The terms of any 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
quarterly (except as otherwise provided in Treasury Regulation section 1.72(p)-1, Q&A-9 for certain
leave of absence and military leave), over a period that does not exceed five (5) years from the date of
the loan; provided, however, that if the proceeds of the loan are applied by the Participant to acquire
any dwelling unit that is to be used within a reasonable time afrer the loan is made as the princi-
pal 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
22
(n)
(0)
and interest payments otherwise due may be suspended during an authorized leave of absence
the promissory note so provides, but not beyond the original term permitted under this Subs:cJo
0), with a revised payment schedule (within such term) instituted at the end of such period ofY~
suspension. If the Participant fails to make any installment payment, the Plan Administrator ma~
according to Treasury Regulation l.72(p)-l, allow a cure period, which cure period cannot contUi'
beyond the last day of the calendar quarter following the calendar quarter in which the required
installment payment was due.
0) Prepayment. The Participant shall be permitted to repay the loan in whole or in part at any time
prior to maturity, without penalty.
(k) Note. The loan shall be evidenced by a promissory note executed by the Participant and delivered
the Employer, and shall bear interest at a reasonable rate determined by the Employer.
Unless waived by a Participant, any plan loan that is outstanding on the date that active duty mili
service begins will accrue interest at a rate of no more than 6% during the period of military servi
in accordance with the provisions of the Servicemembers Civil Relief Act (SCRA), 50 use App.'
526 and subject to the notice requirements contained therein. This limitation applies even if to
payments are suspended during the period of military service as permitted under the Plan and Treas
regulations.
(I)
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 :i
.
Contribution Account, and Rollover Account that is equal to fifty percent (50%) of the Participant's,l
~
Account (to the =ent ve.rod). 1
Assignment or Pledge. For the purposes of paragraphs (h) 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.
(m)
Spousal Consent. If the Employer elected the QJSA Election in the Adoption Agreement, the
Participant must first obtain his or her spouse's notarized consent to the loan.
Other Terms and Conditions. The Employer shall fix such other terms and conditions of the loan as
it deems necessary to comply with legal requirements, to maintain 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.
13.03 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.
(b) 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 Plan shall be liable for any loss, or by reason of any breach,
that results from the Panicipant's exercise of such control.
(c) Repayment of principal and payment of interest shall be made by payroll deduction or, where repay-
ment cannot be made by payroll deduction, by check, and shall be invested in one (1) or more other
23
.~
"
investment funds, in accordance with Section 6.05 of the Plan, as of the next Accounting Date after
payment thereof to the Trust. The amount so invested shall be deducted from the Participant's Loan
Account.
(d)
The Employer shall have the authority to establish other reasonable rules, not inconsistent with the
provisions of the Plan, governing the establishment and maintenance of Participant Loan Accounts.
XIV: 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 decreasing 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 of this paragraph, a Plan amendment
which has the effect of decreasing 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 of the date such amendment is adopted or the date it becomes effective, the
nonforfeitable 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.
No amendment to the Plan shall be effective to eliminate or restrict an optional form of benefit. The
preceding sentence shall not apply to a Plan amendment that eliminates or restricts the ability of a
Participant to receive payment of his or her Account balance under a particular optional form of benefit if the
amendment provides a single-sum distribution form that is otherwise identical to the optional form of benefit
being eliminated or restricted. For this purpose, a single-sum distribution form is otherwise identical only
if the single-sum distribution form is identical in all respects to the eliminated or restricted optional form of
benefit (or would be identical except that it provides greater rights to the Participant) except with respect to
the timing of payments after commencement.
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, (3) amend administrative provisions of the trust or
custodial document in the case of a nonstandardized plan and make more limited amendments in the case of
a standardized plan such as the name of the plan, employer, trustee or custodian, plan administrator and other
fiduciaries, the trust year, and the name of any pooled trust in which the Plan's trust will participate, (4) add
certain sample or model amendments published by the Internal Revenue Service or other required good faith
amendments which specifically provide that their adoption will not cause the plan to be treated as individually
designed, and (5) add or change provisions permitted under the Plan and/or specify or change the effective
date of a provision as permitted under the Plan and correct obvious and unambiguous typographical errors
and/or cross-references that merely correct a reference but that do not in any way change the original intended
meaning of the provisions.
14.02 Amendment of Vesting Schedule. If the Plan's vesting schedule is amended, or the Plan is amended in any
way that directly or indirectly affects the computation of the Participant's nonforfeitable percentage, each
Participant may elect, within a reasonable period after the adoption of the amendment or change, to have the
nonforfeitable percentage computed under the Plan without regard to such amendment or change.
24
"
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 after the Participant is issued written notice of the amendment by the Employer or
Plan Administrator.
14.03 Termination by Employer. The Employer reserves the right to terminate this Plan. However, 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 Participant 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 accordance with the Code and regulations
thereunder.
In the event that the Commissioner ofInternal Revenue determines that the Plan is not initially qualified
under the Internal Revenue Code, any Contribution made by the Employer incident to that initial
qualification must be returned to the Employer within one year after the date the initial qualification is
denied, but only if the 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. In the
event of a complete discontinuance of contributions under the Plan, the Account balance of each affected
Participant shall be nonforfeitable.
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 3D-day period, the Employer notifies
the Administrator, 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 effective if and only if
elected by the Employer and agreed to by the Plan Administrator.
xv. ADMINISTRATION
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;
(c) To appoint a committee to facilitate administration of the Plan and communications to Participants;
25
(d) 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;
(e) To engage an independent qualified public accountant, when required to do so by law, to prepare an-
nually the audited financial statements of the Plan's operation;
(f) 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.
15.02 Duties of the Plan Administrator. The Plan Administrator shall have the following powers and duties:
(a) To construe and interpret the provisions of the Plan;
(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 administer-
ing the Plan;
(f) 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
(h) 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.
15.03 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.
15.04 Protection of the Plan Administrator. The Plan Administrator may rely upon any certificate, 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 Administrator may be removed by
the Employer at any time upon sixty (60) days prior written notice to the Plan Administrator. Upon the
26
resignation or removal of the Plan Administrator, the Employer may appoint a successor Plan Administrator;
failing such appointment, the Employer shall assume the powers and duties of Plan Administrator. Upon the
resignation 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 insutance 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) or by the Employer pursuant to Section 15.01 (d) shall
be final and binding on all persons participating in the Plan, given deference in all courts oflaw 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.
XVI. MISCELLANEOUS
16.01 Nonguarantee of Employment. Nothing contained in this Plan shall be construed as a contract of
employment 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 Rights 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 entitled 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 payable
hereunder, shall be void. The Trust shall not in any manner be liable for, or subject to, the debts, contracts,
liabilities, engagements or torts of any person entitled to benefits hereunder.
16.04 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 meaning of section 414 (p) of the Code or any domestic
relations order entered before January 1, 1985.
16.05 Nonforfeitability 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 accord-
ance with the provisions of the Plan.
16.06 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, sup-
port, education, or use of such person or payor distribute the whole or any part of such benefit to:
(a) The parent of such person;
.~
27
(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 of such 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 dis-
charge therefor.
16.07 Inability to Locate Payee. Anything to the contrary herein notwithstanding, if the Employer 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 application 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, if and when a claim for
the forfeited amount is subsequently made by the Participant or Beneficiary or if the Employer receives proof
of death of such person, satisfactory to the Employer. To the extent not inconsistent with applicable law,
any benefits lost by reason of escheat under applicable state law shall be considered forfeited and shall not be
reinstated.
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 Par-
ticipant in the Plan would (if the Plan then terminated) receive a benefit immediately after the merger, con-
solidation, 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, termina-
tion of service and the reason therefor, leaves of absence, reemployment, Earnings, 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 of the State where the Employer 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(a) and 414(d) of the Code.
SPOUSAL BENEFIT REQUIREMENTS
17.01 Application. Effective as ofJanuary 1, 2006, where elected by the Employer in the Adoption Agreement (the
"QJSA Election"), the provisions of this Article shall take precedence over any conflicting provision in this
Plan. If elected, 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
17.05.
17.02 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 Starting Date, a married Participant's
Vested Account Balance will be paid in the form of a Qualified Joint and Survivor Annuity and an unmarried
28
Participant's Vested Account Balance will be paid in the form of a Straight Life Annuity. The Participant may
elect to have such annuity distributed upon the attainment of the Earliest Retirement Age under the Plan.
17.03 Qualified Preretirement Survivor Annuity. If a 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 total Vested 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 of the forms
available to the Participant under Section 11.02.
17.04 Notice Requirements.
(a) In the case of a Qualified Joint and Survivor Annuity as described in Section 17.02, the Plan Admin-
istrator 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 Annuity; (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 Participant, 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 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;
(3) 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 commence before the
expiration of the 7 -day period that begins after the day after the explanation of the Qualified
Joint and Survivor Annuity is provided to the Participant.
(b) In the case of a Qualified Preretirement Survivor Annuity as described in Section 17.03, the Plan
Administrator shall provide each Participant within the applicable period for such Participant a writ-
ten 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 Plan Year in which the Participant attains age thirty-two (32)
29
and ending with the close of the Plan Year preceding the Plan Year 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 foregoing, notice
must be provided within a reasonable period ending after separation from service in the case of a
Participant who separates ftom 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 Plan Year 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 thereafter returns to employment with the
Employer, the applicable period for such Participant shall be redetermined.
(c) 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 Preretirement Survivor Annuity, and (2) the Plan does not
allow the Participant to waive 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 plan 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.
17.05 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 as an annuity or
any other form.
(b) Election Period: The period which begins on the first day of the Plan Year in which the Participant
attains age thirty-five (35) and ends on the date of the Participant's death. If a Participant separates
from service prior to the first day of the Plan Year 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 Plan Year 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 Plan Year 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 Qualified Preretirement Survivor Annuity
in such terms as are comparable to the explanation required under Section 17.04(a). Qualified
Preretirement Survivor Annuity coverage will be automatically reinstated as of the first day of the Plan
Year in which the Participant attains age thirty-five (35). Any new waiver on or after such date shall
be subject to the full requirements of this Article.
(c) Earliest Retirement 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 Beneficiaries, which may not be changed without spousal consent (or the Spouse
30
,
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 consent 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 Participant 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.
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 requirement 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 of benefit 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 provision shall be valid unless the Participant has received
notice as provided in Section 17.04.
(e) 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 fifty percent (50%) of the amount of the annuity
which is payable duting 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.
(f) 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.
(g) Straight Life Annuity: An annuity payable in equal installments for the life of the Participant that
terminates upon the Participant's death.
(h) 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 Participant who is vested in amounts attributable to Employer Contributions,
Employee contributions (or both) at the time of death or distribution.
17.06 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 of the Code.
31
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DECLARATION OF TRUST
This Declaration of Trust (the "Group Trust Agreement") is made as of the 19th day of May, 2001, by VantageTrust Company,
which declares itself to be the sole Trustee of the trust hereby created.
WHEREAS, the ICMA Retirement Trust was created as a vehicle for the commingling of the assets of governmental plans
and governmental units described in Section 818(a)(6) of the Internal Revenue Code of 1986, as amended, pursuant to a
Declaration of Trust dated October 4, 1982, as subsequently amended, a copy of which is attached hereto and incorporated by
reference as set out below (the "ICMA Declaration"); and
WHEREAS, the trust created hereunder (the "Group Trust") is intended to meet the requirements of Revenue Ruling 81-
100, 1981-1 C.B. 326, and is established as a common trust fund within the meaning of Section 391:1 of Title 35 of the New
Hampshire Revised Statutes Annotated, to accept and hold for investment purposes the assets of the Deferred Compensation
and Qualified Plans held by and through the ICMA Retirement Trust.
NOW; THEREFORE, the Group Trust is created by the execution of this Declaration of Trust by the Trustee and is established
with respect to each Deferred Compensation and Qualified Plan by the transfer to the Trustee of such Plan's assets in the
ICMA Retirement Trust, by the Trustees thereof, in accord with the following provisions:
1. Incorporation of ICMA Declaration by Reference; ICMA By-Laws. Except as otherwise provided in this Group
Trust Agreement, and to the extent not inconsistent herewith, all provisions of the ICMA Declaration are
incorporated herein by reference and made a part hereof, to be read by substituting the Group Trust for the
Retirement Trust and the Trustee for the Board of Trustees referenced therein. In this respect, unless the
context clearly indicates otherwise, all capitalized terms used herein and defined in the ICMA Declaration
have the meanings assigned to them in the ICMA Declaration. In addition, the By-Laws of the ICMA
Retirement Trust, as the same may be amended from time-to-time, are adopted as the By-Laws of the Group
Trust to the extent not inconsistent with the terms of this Group Trust Agreement.
Notwithstanding the foregoing, the terms of the ICMA Declaration and By-Laws are further modified with
respect to the Group Trust created hereunder, as follows:
(a) any reporting, distribution, or other obligation of the Group Trust vis-a.-vis any Deferred
Compensation Plan, Qualified Plan, Public Employer, Public Employer Trustee, or Employer Trust
shall be deemed satisfied to the extent that such obligation is undertaken by the ICMA Retirement
Trust (in which case the obligation of the Group Trust shall run to the ICMA Retirement Trust); and
(b) all provisions dealing with the number, qualification, election, term and nomination of Trustees shall
not apply, and all other provisions relating to trustees (including, but not limited to, resignation
and removal) shall be interpreted in a manner consistent with the appointment of a single corporate
trustee.
2. Compliance with Revenue Procedure 81-100. The requirements of Revenue Procedure 81-100 are applicable to
the Group Trust as follows:
(a) Pursuant to the terms of this Group Trust Agreement and Article X of the By-Laws, investment in the
Group Trust is limited to assets of Deferred Compensation and Qualified Plans, investing through the
ICMA Retirement Trust.
(b) Pursuant to the By-Laws, the Group Trust is adopted as a part of each Qualified Plan that invests
herein through the ICMA Retirement Trust.
(c) In accord with the By-Laws, that part of the Group Trust's corpus or income which equitably belongs
to any Deferred Compensation and Qualified Plan may not be used for or diverted to any purposes
other than for the exclusive benefit of the Plan's employees or their beneficiaries who are entitled to
benefits under such Plan.
(d) In accord with the By-Laws, no Deferred Compensation Plan or Qualified Plan may assign any or
part of its equity or interest in the Group Trust, and any purported assignment of such equity or
interest shall be void.
3. Governing Law. Except as otherwise required by federal, state or local law, this Declaration of Trust (including
the ICMA Declaration to the extent incorporated herein) and the Group Trust created hereunder shall be
construed and determined in accordance with applicable laws of the State of New Hampshire.
4. Judicial Proceedings. The Trustee may at any time initiate an action or proceeding in the appropriate state
or federal courts within or outside the state of New Hampshire for the settlement of its accounts or for the
determination of any question of construction which may arise or for instructions.
IN WITNESS WHEREOF, the Trustee has executed this Declaration of Trust as of the day and year first above written.
VANTAGETRUST COMPANY
By, !f..t :,{,l.#
Name: Paul F. Gallagher
Tide: Secretary
2
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