Exhibit 10.13
Internal Revenue Service Department of the Treasury
Plan Description: Prototype Non-standardized Profit Sharing Plan with CODA
FFN: 50339816103-004 Case: 9201920 EIN: 13-5674085
BPD: 03 Plan: 004 Letter Serial No. D359287b
Washington, DC 20224
Person to Contact: Mr. Wolf
MERRILL LYNCH PIERCE FENNER & SMITH INC.
Telephone Number: (202) 622-8380
P. O. BOX 9038
Refer Reply to: E:EP:Q:1
PRINCETON, NJ 08543
Date: 06/29/93
Dear Applicant:
In our opinion, the amendment to the form of the plan identified above does not
in and of itself adversely affect the plan's acceptability under section 401 of
the Internal Revenue Code. This opinion relates only to the amendment to the
form of the plan. It is not an opinion as to the acceptability of any other
amendment or of the form of the plan as a whole, or as to the effect of other
Federal or local statutes.
You must furnish a copy of this letter to each employer who adopts this plan.
You are also required to send a copy of the approved form of the plan, any
approved amendments and related documents to each Key District Director of
Internal Revenue Service in whose jurisdiction there are adopting employers.
An employer who adopts the amended form of the plan after the date of the
amendment should apply for a determination letter by filing an application with
the Key District Director of Internal Revenue on Form 5307, Short Form
Application for Determination for Employee Benefit Plan.
This letter with respect to the amendment to the form of the plan does not
affect the applicability to the plan of the continued, interim and extended
reliance provisions of sections 13 and 17.03 of Rev. Proc. 89-9, 1989-1 C.B.
780. The applicability of such provisions may be determined by reference to the
initial opinion letter issued with respect to the plan.
If you, the sponsoring organization, have any questions concerning the IRS
processing of this case, please call the above telephone number. This number is
only for use of the sponsoring organization. Individual participants and/or
adopting employers with questions concerning the plan should contact the
sponsoring organization. The plan's adoption agreement must include the
sponsoring organization's address and telephone number for inquiries by adopting
employers.
If you write to the IRS regarding this plan, please provide your telephone
number and the most convenient time for us to call in case we need more
information. Whether you call or write, please refer to the Letter Serial Number
and File Folder Number shown in the heading of this letter.
You should keep this letter as a permanent record. Please notify us if you
modify or discontinue sponsorship of this plan.
Sincerely yours,
Chief, Employee Plans Qualifications Branch
4-26-93
03-004
----------------------------------------------------
MERRILL LYNCH
----------
SPECIAL
----------
PROTOTYPE DEFINED
CONTRIBUTION PLAN
----------------------------------------------------
401(k) PLAN
EMPLOYEE THRIFT PLAN
PROFIT-SHARING PLAN
ADOPTION AGREEMENT
This Prototype Plan and Adoption Agreement are important legal instruments with
legal and tax implications for which the Sponsor, Merrill Lynch, Pierce, Fenner
& Smith, Incorporated, does not assume responsibility. The Employer is urged to
consult with its own attorney with regard to the adoption of this Plan and its
suitability to its circumstances.
2
Adoption of Plan
The Employer named below hereby establishes or restates a profit-sharing plan
that includes a [X] 401(k), [ ] profit-sharing and/or [ ] thrift plan feature
(the "Plan") by adopting the Merrill Lynch Special Prototype Defined
Contribution Plan and Trust as modified by the terms and provisions of this
Adoption Agreement.
Employer and Plan Information
Employer Name:* First Sterling Bank
Business Address: 80 W. Lancaster Avenue
Devon, PA 19333
Telephone Number: (610) 971-1800
Employer Taxpayer I.D. Number: 23-2442500
Employer Taxable Year ends on: December 31st
Plan Name: First Sterling Bank 401(k) Plan
Plan Number: 001
401(k) Profit- Thrift
Sharing
Effective Date of Adoption: 07/01/94 -/-/- -/-/-
--------------- ----------- ------------
Tax Reform Act of 1986
Restatement Date: 02/01/91 -/-/- -/-/-
--------------- ----------- ------------
Original Effective Date: 02/01/91 -/-/- -/-/-
--------------- ----------- ------------
If this Plan is a continuation or an amendment of a prior plan, all optional
forms of benefits provided in the prior plan must be provided under this Plan to
any Participant who had an account balance, whether or not vested, in the prior
plan.
__________________________________________
If there are any Participating Affiliates in this Plan, list below the proper
name of each Participating Affiliate.
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
3
ARTICLE I. Definitions
A. "Compensation"
(1) With respect to each Participant, except as provided below,
Compensation shall mean the (select all those applicable for each
column):
401(k) and/ Profit
or Thrift Sharing
[X] [ ] (a) amount reported in the "Wages Tips and Other
Compensation" Box on Form W-2 for the applicable period
selected in Item 5 below.
[ ] [ ] (b) compensation for Code Section 415 safe-harbor purposes
(as defined in Section 3.9.1(H)(i) of basic plan document
#03) for the applicable period selected in Item 5 below.
[ ] [ ] (c) amount reported pursuant to Code Section 3401(a) for the
applicable period selected in Item 5 below.
[ ] [ ] (d) all amounts received (under either option (a) or (b)
above) for personal services rendered to the Employer but
excluding (select one):
[ ] overtime
[ ] bonuses
[ ] commissions
[ ] amounts in excess of $______
[ ] other (specify) ____________
(2) Treatment of Elective Contributions (select one):
[X] (a) For purposes of contributions, Compensation shall
include Elective Deferrals and amounts excludable from the
gross income of the Employee under Code Section 125, Code
Section 402(e)(3), Code Section 402(h) or Code Section
403(b) ("elective contributions").
[ ] (b) For purposes of contributions, Compensation shall not
include "elective contributions."
(3) CODA Compensation (select one):
[X] (a) For purposes of the ADP and ACP Tests, Compensation
shall include "elective contributions."
[ ] (b) For purposes of the ADP and ACP Tests, Compensation
shall not include "elective contributions."
4
(4) With respect to Contributions to an Employer Contributions Account,
Compensation shall include all Compensation (select one):
[X] (a) during the Plan Year in which the Participant enters the
Plan.
[ ] (b) after the Participant's Entry Date.
(5) The applicable period for determining Compensation shall be (select
one):
[X] (a) the Plan Year.
[ ] (b) the Limitation Year.
[ ] (c) the consecutive 12-month period ending on ___________.
B. "Disability"
(1) Definition
Disability shall mean a condition which results in the Participant's
(select one):
[X] (a) inability to engage in any substantial gainful activity by
reason of any medically determinable physical or mental
impairment that can be expected to result in death or which as
lasted or can be expected to last for a continuous period of not
less than 12 months.
[ ] (b) total and permanent inability to meet the requirements of
the Participant's customary employment which can be expected to
last for a continuous period of not less than 12 months.
[ ] (c) qualification for Social Security disability benefits.
[ ] (d) qualification for benefits under the Employer's long-term
disability plan.
(2) Contributions due to Disability (select one):
[X] (a) No contributions to an Employer Contributions Account will be
made on behalf of a Participant due to his or her Disability.
[ ] (b) Contribution to an Employer Contributions Account will be made on
behalf of a Participant due to his or her Disability provided
that: the Employer elected option (a) or (c) above as the
definition of Disability, contributions are not made on behalf of
a Highly Compensated Employee, the contribution is based on the
Compensation each such Participant would have received for the
Limitation Year if the Participant had been paid at the rate of
Compensation paid immediately before his or her Disability, and
contributions made on behalf of such Participant will be
nonforfeitable when made.
5
C. "Early Retirement" is (select one):
[X] (1) not permitted.
[ ] (2) permitted if a Participant terminates Employment before
Normal Retirement Age and has (select one):
[ ] (a) attained age _____
[ ] (b) attained age _____ and completed ___ Years of Service.
[ ] (c) attained age _____ and completed ___ Years of Service as
a Participant.
D. "Eligible Employees" (select one):
[X] (1) All Employees are eligible to participate in the Plan.
[ ] (2) The following Employees are not eligible to participate in
the Plan (select all those applicable):
[ ] (a) Employees included in a unit of Employees covered by a
collective bargaining agreement between the Employer or
a Participating Affiliate and the Employee
representatives (not including any organization more
than half of whose members are Employees who are owners,
officers, or executives of the Employer or Participating
Affiliate) in the negotiation of which retirement
benefits were the subject of good faith bargaining,
unless the bargaining agreement provides for
participation in the Plan.
[ ] (b) non-resident aliens who received no earned income
from the Employer or a Participating Affiliate which
constitutes income from sources within the United
States.
[ ] (c) Employees of an Affiliate.
[ ] (d) Employees employed in or by the following
specified division, plant, location, job category or
other identifiable individual or group of Employees:
__________________________________________________
__________________________________________________
6
E. "Entry Date"
Entry Date shall mean (select as applicable):
401)k)
and/or Profit-
Thrift Sharing
[ ] [ ] (1) If the initial Plan Year is less than twelve months,
the ____ day of _________ and thereafter.
[ ] [ ] (2) the first day of the Plan Year following the date
the Employee meets the eligibility requirements. If the
Employer elects this option (2) establishing only one Entry
Date, the eligibility "age and service" requirements elected
in Article II must be no more than age 20-1/2 and 6 months
of service.
[X] [ ] (3) the first day of the month following the date the
Employee meets the eligibility requirements.
[ ] [ ] (4) the first day of the Plan Year and the first day
of the seventh month of the Plan Year following the date the
Employee meets the eligibility requirements.
[ ] [ ] (5) the first day of the Plan Year, the first day of
the fourth month of the Plan Year, the first day of the
seventh month of the Plan Year, and the first day of the
tenth month of the Plan Year following the date the Employee
meets the eligibility requirements.
[ ] [ ] (6) other: ________________________________________________
provided that the Entry Date or Dates selected are no later
than any of the options above.
F. "Hours of Service"
Hours of Service for the purpose of determining a Participant's Period of
Severance and Year of Service shall be determined on the basis of the
method specified below:
(1) Eligibility Service: For purposes of determining whether a Participant
has satisfied the eligibility requirements, the following method shall
be used (select one):
401(k)
and/or Profit-
Thrift Sharing
[X] [ ] (a) elapsed time method
[ ] [ ] (b) hourly records method
7
(2) Vesting Service: A Participant's nonforfeitable interest shall be
determined on the basis of the method specified below (select one):
[ ] (a) elapsed time method
[X] (b) hourly records method
[ ] (c) If this item (c) is checked, the Plan only provides for
contributions that are always 100% vested and this item (2)
will not apply.
(3) Hourly Records: For the purpose of determining Hours of Service under
the hourly record method (select one):
[X] (a) only actual hours for which an Employee is paid or
entitled to payment shall be counted.
[ ] (b) an Employee shall be credited with 45 Hours of Service
if such Employee would be credited with at least 1 Hour of
Service during the week.
G. "Integration Level"
[X] (1) This Plan is not integrated with Social Security.
[ ] (2) This Plan is integrated with Social Security. The
Integration Level shall be (select one):
[ ] (a) the Taxable Wage Base.
[ ] (b) $_____ (a dollar amount less than the
Taxable Wage Base).
[ ] (c) _____% of the Taxable Wage Base (not to exceed
100%).
[ ] (d) the greater of $10,000 or 20% of the Taxable
Wage Base.
H. "Limitation Compensation"
For purposes of Code Section 415, Limitation Compensation shall be
compensation as determined for purposes of (select one):
[ ] (1) Code Section 415 Safe-Harbor as defined in Section
3.9.1(H)(i) of the basic plan document #03.
[X] (2) the "Wages, Tips and Other Compensation" Box on form W-2.
[ ] (3) Code Section 3401(a) Federal Income Tax Withholding.
8
I. "Limitation Year"
For purposes of Code Section 415, the Limitation Year shall be (select
one):
[X] (1) the Plan Year.
[ ] (2) the twelve consecutive month period ending on the _____ day of
the month of __________.
J. "Net Profits" are (select one):
[X] (1) not necessary for any contribution.
[ ] (2) necessary for (select all those applicable):
[ ] (a) Profit-Sharing Contributions.
[ ] (b) Matching 401(k) Contributions.
[ ] (c) Matching Thrift Contributions.
K. "Normal Retirement Age"
Normal Retirement Age shall be (select one):
[X] (1) attaining of age 65 (not more than 65) by the Participant.
----
[ ] (2) attainment of age ____ (not more than 65) by the
Participant on the _____ anniversary (not more than the 5th) of
the first day of the Plan Year in which the Eligible Employee
became a Participant, whichever is later.
[ ] (3) attainment of age ____ (not more than 65) by the
Participant on the _____ anniversary (not more than the 5th) of
the first day on which the Eligible Employee performed an Hour of
Service, whichever is later.
L. "Participant Directed Assets" are:
401(k)
and/or Profit-
Thrift Sharing
[X] [ ] (1) permitted.
[ ] [ ] (2) not permitted.
M. "Plan Year"
The Plan Year shall end on the 31st day of December
9
N. "Predecessor Service"
Predecessor service will be credited (select one):
[X] (1) only as required by the Plan.
[ ] (2) to include, in addition to the Plan requirements and subject to
the limitations set forth below, service with the following
predecessor employer(s) determined as if such predecessors were
the Employer: ______________________________
Service with such predecessor employer applies [select either or both (a)
and/or (b); (c) is only available in addition to (a) and/or (b)]:
[ ] (a) for purposes of eligibility to participate;
[ ] (b) for purposes of vesting;
[ ] (c) except for the following service: __________________________
O. "Valuation Date"
Valuation Date shall mean (select one for each column, as applicable):
401(k)
and/or Profit-
Thrift Sharing
[ ] [ ] (1) the last business day of each month.
[ ] [ ] (2) the last business day of each quarter within the Plan Year.
[ ] [ ] (3) the last business day of each semi-annual period within the
Plan Year.
[ ] [ ] (4) the last business day of the Plan Year.
[X] [ ] (5) other: Daily.
ARTICLE II. Participation
Participation Requirements
An Eligible Employee must meet the following requirements to become a
Participant (select one or more for each column, as applicable):
401(k)
and/or Profit-
Thrift Sharing
[ ] [ ] (1) Performance of one Hour of Service.
10
[ ] [ ] (2) Attainment of age _____ (maximum 20 1/2) and completion of
___ (not more than 1/2) Years of Service. If this item is
selected, no Hours of Service shall be counted.
[X] [ ] (3) Attainment of age 21 (maximum 21) and completion of 1/2
Year(s) of Service. If more than one Year of Service is
selected, the immediate 100% vesting schedule must be
selected in Article VII of this Adoption Agreement.
[ ] [ ] (4) Attainment of age _____ (maximum 21) and completion of ___
Years of Service. If more than one Year of Service is
selected, the immediate 100% vesting schedule must be
selected in Article VII of this Adoption Agreement.
[ ] [ ] (5) Each Employee who is an Eligible Employee on -/-/- be deemed
to have satisfied the participation requirements on the
effective date without regard to such Eligible Employee's
actual age and/or service.
ARTICLE III. 401(k) Contributions and Account Allocation
A. Elective Deferrals
If selected below, a Participant's Elective Deferrals will be (select all
applicable):
[X] (1) a dollar amount or a percentage of Compensation, as specified
by the Participant on his or her 401(k) Election form, which may
not exceed 15% of his or her Compensation.
[X] (2) with respect to bonuses, such dollar amount or percentage as
specified by the Participant on his or her 401(k) Election form
with respect to such bonus.
B. Matching 401(k) Contributions
If selected below, the Employer may make Matching 401(k) Contributions for
each Plan Year (select one):
[ ] (1) Discretionary Formula:
Discretionary Matching 401(k) Contribution equal to such a
dollar amount or percentage of Elective Deferrals, as
determined by the Employer, which shall be allocated (select
one):
[ ] (a) based on the ratio of each Participant's
Elective Deferral for the Plan Year to the total
Elective Deferrals of all Participants for the Plan
Year. If inserted, Matching 401(k) Contributions
shall be subject to a maximum
11
amount of $_______ for each Participant or ____% of
each Participant's Compensation.
[ ] (b) in an amount not to exceed ____% of each
Participant's first ____% of Compensation
contributed as Elective Deferrals for the Plan
Year. If any Matching 401(k) Contribution remains,
it is allocated to each such Participant in an
amount not to exceed ____% of the next ____% of
each Participant's Compensation contributed as
Elective Deferrals for the Plan Year.
Any remaining Matching 401(k) Contribution shall be allocated to each such
Participant in the ratio that such Participant's Elective Deferral for the
Plan Year bears to the total Elective Deferrals of all such Participants
for the Plan Year. If inserted, Matching 401(k) Contributions shall be
subject to a maximum amount of $_____ for each Participant or ____% of each
Participant's Compensation.
[X] (2) Nondiscretionary Formula:
A nondiscretionary Matching 401(k) Contribution for each Plan
Year equal to (select one):
[ ] (a) ____% of each Participant's Compensation
contributed as Elective Deferrals. If inserted,
Matching 401(k) Contributions shall be subject to a
maximum amount of $______ for each Participant or
____% of each Participant's Compensation.
[X] (b) 40 % of the first 6 % of the Participant's
Compensation contributed as Elective Deferrals and
____% of the next ____% of the Participant's
Compensation contributed as Elective Deferrals. If
inserted, Matching 401(k) Contributions shall be
subject to a maximum amount of $______ for each
Participant or ____% of each Participant's
Compensation.
C. Participants Eligible for Matching 401(k) Contribution Allocation
The following Participants shall be eligible for an allocation to their
Matching 401(k) Contributions Account (select all those applicable):
[X] (1) Any Participant who makes Elective Deferrals.
[ ] (2) Any Participant who satisfies those requirements elected by
the Employer for an allocation to his or her Employer
Contributions Account as provided in Article IV Section C.
12
[ ] (3) Solely with respect to a Plan in which Matching 401(k)
Contributions are made quarterly (or on any other regular
interval that is more frequent than annually) any Participant
whose 401(k) Election is in effect throughout such entire quarter
(or other interval).
D. Qualified Matching Contributions
If selected below, the Employer may make Qualified Matching Contributions
for each Plan Year (select all those applicable):
(1) In its discretion, the Employer may make Qualified Matching
Contributions on behalf of (select one):
[ ] (a) all Participants who make Elective Deferrals in that
Plan Year.
[X] (b) only those Participants who are Nonhighly
Compensated Employees and who make Elective Deferrals
for that Plan Year.
(2) Qualified Matching Contributions will be contributed and
allocated to each Participant in an amount equal to:
[ ] (a) ____% of the Participant's Compensation
contributed as Elective Deferrals. If inserted,
Qualified Matching Contributions shall not exceed ____%
of the Participant's Compensation.
[X] (b) Such an amount, determined by the Employer, which is
needed to meet the ACP Test.
(3) In its discretion, the Employer may elect to designate all or any
part of Matching 401(k) Contributions as Qualified Matching
Contributions that are taken into account as Elective Deferrals -
included in the ADP Test and excluded from the ACP Test - on
behalf of (select one):
[ ] (a) all Participants who make Elective Deferrals for that
Plan Year.
[X] (b) Only Participants who are Nonhighly Compensated
Employees who make Elective Deferrals for that Plan
Year.
E. Qualified Nonelective Contributions
If selected below, the Employer may make Qualified Nonelective
Contributions for each Plan Year (select all those applicable):
(1) In its discretion, the Employer may make Qualified Nonelective
Contributions on behalf of (select one):
[ ] (a) all Eligible Participants.
13
[X] (b) only Eligible Participants who are Nonhighly Compensated
Employees.
(2) Qualified Nonelective Contributions will be contributed and allocated
to each Eligible Participant in an amount equal to (select one):
[ ] (a) ____% (no more than 15%) of the Compensation of
each Eligible Participant eligible to share in the
allocation.
[X] (b) Such an amount determined by the Employer, which is
needed to meet either the ADP Test or ACP Test.
(3) At the discretion of the Employer, as needed and taken into account as
Elective Deferrals included in the ADP Test on behalf of (select one):
[ ] (a) all Eligible Participants.
[X] (b) only those Eligible Participants who are Nonhighly
Compensated Employees.
F. Elective Deferrals used in ACP Test (select one):
[X] (1) At the discretion of the Employer, Elective Deferrals may be
used to satisfy the ACP Test.
[ ] (2) Elective Deferrals may not be used to satisfy the ACP Test.
G. Making and modifying a 401(k) Election
An Eligible Employee shall be entitled to increase, decrease or resume his
or her Elective Deferral percentage with the following frequency during the
Plan Year (select one):
[ ] (1) annually.
[ ] (2) semi-annually.
[ ] (3) quarterly.
[X] (4) monthly.
[ ] (5) other (specify):__________.
Any such increase, decrease or resumption shall be effective as of the
first payroll period coincident with or next following the first day of
each period set forth above. A Participant may completely discontinue
making Elective Deferrals at any time effective for the payroll period
after written notice is provided to the Administrator.
14
ARTICLE IV. Profit-Sharing Contributions and Account Allocation
THIS ARTICLE IS NOT APPLICABLE
A. Profit-Sharing Contributions
If selected below, the following contributions for each Plan Year will be
made:
Contributions to Employer Contributions Accounts (select one):
[ ] (a) Such an amount, if any, as determined by the Employer.
[ ] (b) ____% of each Participant's Compensation.
B. Allocation of Contributions to Employer Contributions Accounts (select one):
[ ] (1) Non-Integrated Allocation
The Employer Contributions Account of each Participant
eligible to share in the allocation for a Plan Year shall be
credited with a portion of the contribution, plus any
forfeitures if forfeitures are reallocated to Participants,
equal to the ratio that the Participant's Compensation for
the Plan Year bears to the Compensation for that Plan Year
of all Participants entitled to share in the contribution.
[ ] (2) Integrated Allocation
Contributions to Employer Contributions Accounts with
respect to a Plan Year, plus any forfeitures if forfeitures
are reallocated to Participants, shall be allocated to the
Employer Contributions Account of each eligible Participant
as follows:
(a) First, in the ratio that each such Participant's
Compensation eligible Participants but not in excess of
3% of each Participant's Compensation.
(b) Second, any remaining contributions and forfeitures will
be allocated in the ratio that each eligible
Participant's Compensation for the Plan Year in excess
of the Integration Level bears to all such Participants'
excess Compensation for the Plan Year but not in excess
of 3%.
(c) Third, any remaining contributions and forfeitures will
be allocated in the ratio that the sum of each
Participant's Compensation and Compensation in excess of
the Integration level bears to the sum of all
Participants' Compensation and Compensation in excess of
the Integration Level, but not in
15
excess of the Maximum Profit-Sharing Disparity Rate
(defined below).
(d) Fourth, any remaining contributions or forfeitures will
be allocated in the ratio that each Participant's
Compensation for that year bears to all Participants'
Compensation for that year.
The Maximum Profit-Sharing Disparity Rate is equal to the
lesser of:
(a) 2.7% or
(b) The applicable percentage determined in accordance with
the following table:
If the Integration
Level is (as a % of the applicable
the Taxable Wage Base ("TWB")). percentage is:
20% (or $10,000 if greater)
or less of the TWB 2.7%
More than 20% (but not less
than $10,001) but not more
than 80% of the TWB 1.3%
More than 80% but not less
than 100% Of the TWB 2.4%
100% of the TWB 2.7%
C. Participants Eligible for Employer Contribution Allocation
The following Participants shall be eligible for an allocation to their
Employer Contributions Accounts (select all those applicable):
[ ] (1) Any Participant who was employed during the Plan Year.
[ ] (2) In the case of a Plan using the hourly record method for
determining Vesting Service, any Participant who was credited
with a Year of Service during the Plan Year.
[ ] (3) Any Participant who was employed on the last day of the Plan Year.
[ ] (4) Any Participant who was on a leave of absence on the last day of
the Plan Year.
16
[ ] (5) Any Participant who during the Plan Year died or became
Disabled while an Employee or terminated employment after
attaining Normal Retirement Age.
[ ] (6) Any Participant who was credited with at least 501 Hours of
Service whether or not employed on the last day of the Plan Year.
[ ] (7) Any Participant who was credited with at least 1,000 Hours of
Service and was employed on the last day of the Plan Year.
ARTICLE V. Thrift Contributions
THIS ARTICLE IS NOT APPLICABLE
A. Employee Thrift Contributions
If selected below, Employee Thrift Contributions, which are required for
Matching Thrift Contributions, may be made by a Participant in an amount
equal to (select one):
[ ] (1) A dollar amount or a percentage of the Participant's
Compensation which may not be less than ____% nor may not exceed
____% of his or her Compensation.
[ ] (2) An amount not less than ____% of and not more than ____% of
each Participant's Compensation.
B. Making and modifying an Employee Thrift Contribution Election
A Participant shall be entitled to increase, decrease or resume his or her
Employee Thrift Contribution percentage with the following frequency during
the Plan Year (select one):
[ ] (1) annually
[ ] (2) semi-annually
[ ] (3) quarterly
[ ] (4) monthly
[ ] (5) other (specify):________________.
Any such increase, decrease or resumption shall be effective as of the
first payroll period coincident with or next following the first day of
each period set forth above. A Participant may completely discontinue
making Employee Thrift Contributions at any time effective for the payroll
period after written notice is provided to the Administrator.
C. Thrift Matching Contributions
If selected below, the Employer will make Matching Thrift Contributions for
each Plan Year (select one):
17
[ ] (1) Discretionary Formula:
A discretionary Matching Thrift Contribution equal to such a dollar amount or
percentage as determined by the Employer, which shall be allocated (select one):
[ ] (a) based on the ratio of each Participant's Employee
Thrift Contribution for the Plan Year to the total
Employee Thrift Contributions of all Participants for
the Plan Year. If inserted, Matching Thrift
Contributions shall be subject to a maximum amount of
$_____ for each Participant or ____% of each
Participant's Compensation.
[ ] (b) in an amount not to exceed ____% of each
Participant's first ____% of Compensation contributed as
Employee Thrift Contributions for the Plan Year. If any
Matching Thrift Contribution remains, it is allocated to
each such Participant in an amount not to exceed ____%
of the next ____% of each Participant's Compensation
contributed as Employee Thrift Contributions for the
Plan Year.
Any remaining Matching Thrift Contribution shall be allocated to each such
Participant in the ratio that such Participant's Employee Thrift Contributions
for the Plan Year bears to the total Employee Thrift Contributions of all such
Participants for the Plan Year. If inserted, Matching Thrift Contributions shall
be subject to a maximum amount of $_____ for each Participant or ____% of each
Participant's Compensation.
[ ] (2) Nondiscretionary Formula:
A nondiscretionary Matching Thrift Contribution for each Plan
Year equal to (select one):
[ ] (a) ____% of each Participant's Compensation
contributed as Employee Thrift Contributions. If
inserted, Matching Thrift Contributions shall be subject
to a maximum amount of $_____ for each Participant or
____% of each Participant's
Compensation.
[ ] (b) ____% of the first ____% of the Participant's
Compensation contributed as Employee Thrift
Contributions and ____% of the next ____% of the
Participant's Compensation contributed as Employee
Thrift Contributions. If inserted, Matching Thrift
Contributions shall be subject to a maximum amount of
$_____ for each Participant or ____% of each
Participant's Compensation.
18
D. Qualified Matching Contribution
If selected below, the Employer may make Qualified Matching Contributions
for each Plan Year (select all those applicable):
(1) In its discretion, the Employer may make Qualified Matching
Contributions on behalf of (select one):
[ ] (a) all Participants who make Employee Thrift Contributions.
[ ] (b) only those Participants who are Nonhighly
Compensated Employees and who make Employee Thrift
Contributions.
(2) Qualified Matching Contributions will be contributed and
allocated to each Participant in an amount equal to:
[ ] (a) ____% of the Participant's Employee Thrift
Contributions. If inserted, Qualified Matching
Contributions shall not exceed ____% of the
Participant's Compensation.
[ ] (b) such an amount, determined by the Employer, which
is needed to meet the ACP Test.
ARTICLE VI. Participant Contributions
Participant Voluntary Nondeductible Contributions
Participant Voluntary Nondeductible Contributions are (select one):
[ ] (a) permitted.
[X] (b) not permitted.
ARTICLE VII. Vesting
A. Employer Contribution Accounts
(1) A Participant shall have a vested percentage in his or her
Profit-Sharing Contributions, Matching 401(k) Contributions and/or
Matching Thrift Contributions, if applicable, in accordance with the
following schedule (select
one):
Matching 401(k)
and/or Matching
Thrift Profit-Sharing
Contributions Contributions
- ------------- -------------
[ ] [ ] (a) 100% vesting immediately upon participation.
19
[ ] [ ] (b) 100% after ___ (not more than 5) years of Vesting Service.
[X] [ ] (c) Graded vesting schedule:
20 % % after 1 year of Vesting Service;
----- -----
40 % % after 2 years of Vesting Service;
----- -----
60 % % (not less than 20%) after 3 years of Vesting Service;
----- -----
80 % % (not less than 40%) after 4 years of Vesting Service;
----- -----
100 % % (not less than 60%) after 5 years of Vesting Service;
----- -----
% % (not less than 80%) after 6 years of Vesting Service;
----- -----
100% after 7 years of Vesting Service.
(2) Top Heavy Plan
Matching 401(k)
and/or Matching
Thrift Profit-Sharing
Contributions Contributions
- ------------- -------------
Vesting Schedule (select one):
[ ] [ ] (a) 100% vesting immediately upon participation.
[ ] [ ] (b) 100% after ______ (not more than 3) years of Vesting
Service.
[X] [ ] (c) Graded vesting schedule:
20 % % after 1 year of Vesting Service;
----- -----
40 % % (not less than 20%) after 2 years of Vesting Service;
----- -----
60 % % (not less than 40%) after 3 years of Vesting Service;
----- -----
80 % % (not less than 60%) after 4 years of Vesting Service;
----- -----
100 % % (not less than 80%) after 5 years of Vesting Service;
----- -----
100% after 6 years of Vesting Service.
20
Top Heavy Ratio:
(a) If the adopting Employer maintains or has ever maintained a qualified
defined benefit plan, for purposes of establishing present value to
compute the top-heavy ratio, any benefit shall be discounted only for
mortality and interest based on the following:
Interest Rate: 8 %
Mortality Table: UP 84
(b) For purposes of computing the top-heavy ratio, the valuation date
shall be the last business day of each Plan Year.
B. Allocation of Forfeitures
Forfeitures shall be (select one from each applicable column):
Matching 401(k)
and/or Matching
Thrift Profit-Sharing
Contributions Contributions
- ------------- -------------
[X] [ ] (1) used to reduce Employer contributions for succeeding
Plan Year.
[ ] [ ] (2) allocated in the succeeding Plan Year in the ratio
which the Compensation of each Participant for the Plan
Year bears to the total Compensation of all
Participants entitled to share in the Contributions. If
the Plan is integrated with Social Security,
forfeitures shall be allocated in accordance with the
formula elected by the Employer.
C. Vesting Service
For purposes of determining Years of Service for Vesting Service [select
(1) or (2) and/or (3)]:
[X] (1) All Years of Service shall be included
[ ] (2) Years of Service before the Participant attained age 18 shall be
excluded.
[ ] (3) Service with the Employer prior to the effective date of the Plan
shall be excluded.
21
ARTICLE VIII. Deferral of Benefit Distributions,
In-Service Withdrawals and Loans
A. Deferral of Benefit Distributions N/A
401(k) and/ Profit-
or Thrift Sharing
- --------- -------
[ ] [ ] If this item is checked, a Participant's vested
benefit in his or her Employer Accounts shall be payable as
soon as practicable after the earlier of: (1) the date the
Participant terminates Employment due to Disability or (2)
the end of the Plan Year in which a terminated Participant
attains Early Retirement Age, if applicable, or Normal
Retirement Age.
B. In-Service Distributions
[X] (1) In-service distributions may be made from any of the
Participant's vested Accounts, at any time upon or after the
occurrence of the following events (select all applicable):
[X] (a) a Participant's attainment of age 59-1/2.
[X] (b) due to hardships as defined in Section 5.9 of the Plan.
[ ] (2) In-service distributions are not permitted.
C. Loans are:
401(k) and/ Profit-
or Thrift Sharing
- --------- -------
[X] [ ] (1) permitted.
[ ] [ ] (2) not permitted.
ARTICLE IX. Group Trust
[ ] If this item is checked, the Employer elects to establish a Group Trust
consisting of such Plan assets as shall from time to time be transferred to
the Trustee pursuant to Article I of the Plan. The Trust Fund shall be a
Group Trust consisting of assets of this Plan plus assets of the following
plans of the Employer or of an Affiliate: ________________________________
__________________________________________
22
ARTICLE X. Miscellaneous
A. Identification of Sponsor
The address and telephone number of the Sponsor's authorized representative
is 800 Scudders Mill road, Plainsboro, New Jersey 08536; (609) 282-2272.
This authorized representative can answer inquiries regarding the adoption
of the Plan, the intended meaning of any Plan provisions, and the effect of
the opinion letter.
The Sponsor will inform the adopting Employer of any amendments made to the
Plan or the discontinuance or abandonment of the Plan.
B. Plan Registration
(1) Initial Registration
This Plan must be registered with the Sponsor, Merrill Lynch, Pierce,
Fenner & Smith Incorporated, in order to be considered a Prototype
Plan by the Sponsor. Registration is required so that the Sponsor is
able to provide the Administrator with documents, forms and
announcements relating to the administration of the Plan and with Plan
amendments and other documents, all of which relate to administering
the Plan in accordance with applicable law and maintaining compliance
of the Plan with the law.
The Employer must complete and sign the Adoption Agreement. Upon
receipt of the Adoption Agreement, the Plan will be registered as a
Prototype Plan of Merrill Lynch, Pierce, Fenner & Smith Incorporated.
The Adoption Agreement will be countersigned by an authorized
representative and a copy of the countersigned Adoption Agreement will
be returned to the Employer.
(2) Registration Renewal
Annual registration renewal is required in order for the Employer to
continue to receive any and all necessary updating documents. There is
an annual registration renewal fee in the amount set forth with the
initial registration material. The adopting Employer authorizes
Merrill Lynch, Pierce, Fenner & Smith Incorporated, to debit the
account established for the Plan for payment of agreed upon annual
fee; provided, however, if the assets of an account are invested
solely in Participant-Directed Assets, a notice for this annual fee
will be sent to the Employer annually. The Sponsor reserves the right
to change this fee from time to time and will provide written notice
in advance of any change.
C. Prototype Replacement Plan
This Adoption Agreement is a replacement prototype plan for the (1) Merrill
Lynch special Prototype Defined Contribution Plan and Trust - 401(k) Plan
#03-004 and (2) Merrill Lynch Asset Management, Inc., Special Prototype
Defined Contribution Plan and Trust - 401(k) Plan Adoption Agreement
#03-004.
23
D. Reliance
The adopting Employer may not rely on the opinion letter issued by the
National Office of the Internal Revenue Service as evidence that this Plan
is qualified under Code Section 401. In order to obtain reliance, the
Employer must apply to the appropriate Key District Director of the
Internal Revenue Service for a determination letter with respect to the
Plan.
EMPLOYER
Dated:___________________ By:_________________________________
Signature
To be executed by the sole proprietor, an
authorized partner or corporate officer, as
appropriate.
______________________________________
Print Name
______________________________________
Title, if a corporate officer
Sponsor Acceptance
Subject to the terms and conditions of the Prototype Plan and this Adoption
Agreement, this Adoption Agreement is accepted by Merrill Lynch, Pierce, Fenner
& Smith Incorporated as the Prototype Sponsor.
Authorized Signature:____________________________
24
Merrill Lynch Trust Company is NOT a Trustee
ACCEPTANCE BY TRUSTEE(S)
A. This Trustee Acceptance is to be completed only if the Employer appoints
one or more Trustees and does not appoint a Merrill Lynch Trust Company as
Trustee.
The undersigned hereby accept all of the terms, conditions, and obligations
of appointment as Trustee under the Plan. If the Employer has elected a
Group Trust in this Adoption Agreement, the undersigned Trustee(s) shall be
the Trustee(s) of the Group Trust.
as TRUSTEE
________________________________ _______________________________________
(Signature) (print or type name)
as TRUSTEE
________________________________ _______________________________________
(Signature) (print or type name)
as TRUSTEE
________________________________ _______________________________________
(Signature) (print or type name)
as TRUSTEE
________________________________ _______________________________________
(Signature) (print or type name)
Dated:______________, 19__
25
The Merrill Lynch Trust Companies as Trustee
This Trustee Acceptance and designation of Investment Committee are to be
completed only when Merrill Lynch Trust Company is appointed as Trustee.
The undersigned hereby accept all of the terms, conditions, and obligations
of appointment as Trustee under the Plan. If the Employer has elected a
Group Trust in this Adoption Agreement, the undersigned Trustee(s) shall be
the Trustee(s) of the Group Trust.
SEAL MERRILL LYNCH TRUST COMPANY [________________________]
_______________________________________________
Dated:____________, 19__ By: _______________________________________________
DESIGNATION OF INVESTMENT COMMITTEE
The Investment Committee for the Plan is (print or type name):
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
__________________________________________________________________
26
The Merrill Lynch Trust Companies as one of the Trustees
This Trustee Acceptance is to be completed only if, in addition to a
Merrill Lynch Trust Companies Trustee, the Employer appoints an additional
Trustee of a second trust fund.
The undersigned hereby accept all of the terms, conditions, and obligations
of appointment as Trustee under the Plan. If the Employer has elected a
Group Trust in this Adoption Agreement, the undersigned Trustee(s) shall be
the Trustee(s) of the Group Trust.
as TRUSTEE
__________________________________ ___________________________________
(Signature) (print or type name)
Dated: ____________, 19_________
SEAL MERRILL LYNCH TRUST COMPANY [____________________________]
____________________________________________________
Dated: ____________, 19________
DESIGNATION OF INVESTMENT COMMITTEE
The Investment Committee for the Plan is (print or type name):
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________
27