EXHIBIT 10.20
AMENDMENT NUMBER ONE
TO
CARVER FEDERAL SAVINGS BANK
RETIREMENT INCOME PLAN
(As Amended and Restated Effective as of January 1, 1997
and as Further Amended Through January 1, 2001)
Pursuant to Section 14.1 of Carver Federal Savings Bank Retirement Income
Plan as amended and restated effective January 1, 1997 and further amended and
restated through January 1, 2001 ("Plan"), the Plan is amended effective as
follows:
1. Preamble
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The following amendments to the Plan are adopted to reflect certain
provisions of the Economic Growth and Tax Relief Reconciliation Act of
2001 ("EGTRRA"). The amendments are intended as good faith compliance with
the requirements of EGTRRA and are to be construed in accordance with
EGTRRA and guidance issued thereunder. Except as otherwise provided, the
amendments shall be effective as of the first day of the first Plan Year
beginning after December 31, 2001.
These amendments shall supersede the provisions of the Plan to the extent
Plan provisions are inconsistent with the provisions of the following
amendments.
2. Earnings (Plan Section 1.1(J))
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For Plan Years beginning after December 31, 2001, the first sentence of
the second paragraph of Section 1.1(J) is restated in its entirety, to
read as follows:
"The amount of Compensation taken into account for a Plan Year
consisting of twelve (12) months for Plan Years commencing on and
after January 1, 1997, shall not exceed one hundred sixty thousand
dollars ($160,000) for the 1997, 1998 and 1999 Plan Years, one
hundred seventy thousand dollars ($170,000) for the 2000 and 2001
Plan Years and two hundred thousand dollars ($200,000) for the 2002
Plan Year, thereafter adjusted in multiples of five thousand dollars
($5,000) for increases in the cost-of-living as prescribed by the
Secretary of the Treasury under Section 401(a)(17)(B) of the Code."
3. Section 415 Limitations on Benefits (Plan Section 6.1)
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Section 6.1(A)(8) is restated as follows, effective for Limitation Years
ending after December 31, 2001:
(8) "MAXIMUM PERMISSIBLE DOLLAR AMOUNT" - one hundred sixty
thousand dollars ($160,000). Such amount shall be adjusted in
accordance with the provisions of Section 6.1(C).
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Section 6.1(A)(10) is amended by the addition of the following new
paragraph at the end thereof, effective for Limitation Years ending after
December 31, 2001:
Benefit increases resulting from the increase in the Maximum
Permissible Dollar Amount for Limitation Years ending after
December 31, 2001 shall be provided to all current and former
Participants who have an Accrued Benefit on the last day of
the Limitation Year immediately prior to the Limitation Year
ending after December 31, 2001 (other than an Accrued Benefit
resulting from a benefit increase solely as a result of the
increase in the Maximum Permissible Dollar Amount for
Limitation Years ending after December 31, 2001).
Section 6.1(C)(6) is restated as follows, effective for Limitation Years
ending after December 31, 2001:
(6) A Participant's benefit which commences after attainment of
age 65 may exceed the Maximum Permissible Dollar Amount,
provided the Actuarial Equivalent of such annual benefit
commencing at age 65 satisfies such Maximum Permissible Dollar
Amount actuarially adjusted to the date of retirement. The
actuarial equivalent of the Maximum Permissible Dollar Amount
commencing at an age after age 65 shall be determined as the
lesser of: (1) the Actuarial Equivalent annual benefit
calculated using the interest rate and mortality table (or
tabular factors) as set forth in Appendix A of the Plan for
purposes of determining the Actuarial Equivalent for a
Postponed Retirement Benefit, and (2) the equivalent annual
benefit calculated using a five percent (5%) interest rate
assumption and the GATT Applicable Mortality Table as set
forth in Table A. For these purposes, mortality between age 65
and the age at which benefits commence shall be ignored.
Section 6.1(C)(7)(c) is restated as follows, effective for Limitation
Years ending after December 31, 2001:
(c) If a Participant's benefit commences prior to attainment of
age 62, the Maximum Permissible Dollar Amount shall be equal
to a benefit commencing at age 62, reduced to the actuarial
equivalent of such benefit determined as of the benefit
commencement date. In determining the actuarial equivalent of
a benefit commencing prior to age 62, such benefit shall be
determined as the lesser of: (1) the Actuarial Equivalent
annual benefit calculated using the interest rate and
mortality table (or tabular factors) as set forth in Appendix
A of the Plan, and (2) the equivalent annual benefit
calculated using a five percent (5%) interest rate assumption
and the GATT Applicable Mortality Table as set forth in Table
A of the Plan. Any decrease in the Maximum Permissible Dollar
Amount determined hereunder shall not reflect a mortality
decrement if benefits are not forfeited upon the death of a
Participant. If any benefits are forfeited upon death, the
full mortality decrement is taken into account.
4. Modification of Top-Heavy Plan Provisions (Section 6.2)
This Section shall apply for purposes of determining whether the Plan is a
top-heavy plan under Section 416(g) of the Code for Plan Years beginning
after December 31, 2001, and whether the Plan satisfies the minimum
benefits requirements of Section 416(c) of the Code for such years. This
Section amends Section 6.2 of the Plan.
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Determination of top-heavy status
Key Employee. Key Employee means any Employee or former Employee
(including any deceased Employee) who at any time during the Plan Year
that includes the Determination Date was an officer of the Employer having
annual Compensation greater than one hundred thirty thousand dollars
($130,000) (as adjusted under Section 416(i)(1) of the Code for Plan Years
beginning after December 31, 2002), a 5-percent owner of the Employer, or
a 1-percent owner of the Employer having Annual Compensation of more than
one hundred fifty thousand dollars ($150,000). For this purpose, "Annual
Compensation" means compensation within the meaning of Section 415(c)(3)
of the Code. The determination of who is a Key Employee will be made in
accordance with Section 416(i)(1) of the Code and the applicable
regulations and other guidance of general applicability issued thereunder.
Determination of present values and amounts. The following subparagraphs
(a) and (b) shall apply for purposes of determining the present values of
Accrued Benefits of Employees as of the Determination Date.
(a) Distributions during year ending on the Determination Date.
The present values of Accrued Benefits of an Employee as of
the Determination Date shall be increased by the distributions
made with respect to the Employee under the Plan and any plan
aggregated with the Plan under Section 416(g)(2) of the Code
during the 1-year period ending on the Determination Date. The
preceding sentence shall also apply to distributions under a
terminated plan which, had it not been terminated, would have
been aggregated with the Plan under Section 416(g)(2)(A)(i) of
the Code. In the case of a distribution made for a reason
other than separation from service, death, or disability, this
provision shall be applied by substituting "5-year period" for
"1-year period."
(b) Employees not performing services during year ending on the
Determination Date. The Accrued Benefits of any individual who
has not performed services for the Employer during the 1-year
period ending on the Determination Date shall not be taken
into account.
Top-Heavy Earnings. Top-Heavy Earnings means, for any year, an
individual's annual compensation as defined under Section 414(q)(4) of the
Code, up to a maximum of two hundred thousand dollars ($200,000), adjusted
in multiples of five thousand dollars ($5,000) for increases in the
cost-of-living as prescribed by the Secretary of the Treasury under
Section 401(a)(17)(B) of the Code.
Minimum benefits
For purposes of satisfying the minimum benefit requirements of Section
416(c)(1) of the Code and the Plan, in determining years of service with
the Employer, any service with the Employer shall be disregarded to the
extent that such service occurs during a Plan Year when the Plan benefits
(within the meaning of Section 410(b) of the Code) no key employee or
former key employee.
5. Direct Rollover of Eligible Rollover Distributions (Plan Section 8.4)
Modification of definition of "Eligible Retirement Plan." Effective with
Plan distributions made after December 31, 2001, for purposes of the
direct rollover provision in Plan Section 8.4, an
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Eligible Retirement Plan shall also mean an annuity contract described in
Section 403(b) of the Code and 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. 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.
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