EXHIBIT 99.06
FINANCIAL INSTITUTIONS
THRIFT PLAN
15TH REVISION, EFFECTIVE DECEMBER 31, 2001
108 CORPORATE PARK DRIVE WHITE PLAINS, N.Y. 10604
A tax-exempt, trusteed savings plan
established July 1, 1970
in order that eligible employees
of financial institutions and other organizations serving them may save and
invest on a regular, long term basis.
TABLE OF CONTENTS
PURPOSE ................................................................ i
ARTICLE 1 DEFINITIONS ......................................... 1
ARTICLE II PARTICIPATION AND MEMBERSHIP ........................ 8
Section 1 Employer Participation .............................. 8
Section 2 Employee Membership ................................. 8
ARTICLE III CONTRIBUTIONS ....................................... 12
Section 1 Contributions by Members ............................ 12
Section 2 Regular Contributions by Employer.................... 12
Section 3 Supplemental Contributions by Employer .............. 13
Section 4 401(k) Features ..................................... 14
Section 5 Remittance of Contributions ......................... 21
Section 6 Transfer of Funds and Rollover
Contributions ................................. 22
Section 7 Limitations on Member Contributions
and Matching Employer Contributions ........... 25
Section 8 Profit Sharing Feature .............................. 28
Section 9 Catch-up Contributions .............................. 31
ARTICLE IV INVESTMENT OF CONTRIBUTIONS ......................... 32
ARTICLE V MEMBERS' ACCOUNTS, UNITS AND VALUATION .............. 34
ARTICLE VI VESTING OF UNITS .................................... 35
Section 1 Vesting ............................................. 35
Section 2 Forfeitures ......................................... 38
ARTICLE VII WITHDRAWAL PAYMENTS ................................. 40
Section 1 General ............................................. 40
Section 2 Account Withdrawal While Employed ................... 40
Section 3 Account Withdrawal Upon Termination of
Employment or Employer Participation .......... 41
Section 4 Account Withdrawal Upon Member's
Disability .................................... 45
Section 5 Member's Death ...................................... 46
ARTICLE VIII LOAN PROGRAM ........................................ 47
Section 1 General ............................................. 47
Section 2 Loan Application .................................... 47
Section 3 Permitted Loan Amount ............................... 48
Section 4 Source of Funds for Loan ............................ 48
Section 5 Conditions of Loan .................................. 48
Section 6 Crediting of Repayment .............................. 49
Section 7 Cessation of Payments on Loan ....................... 49
Section 8 Loans to Former Members and Beneficiaries ........... 50
ARTICLE IX ADMINISTRATION OF PLAN .............................. 51
Section 1 Board of Directors .................................. 51
Section 2 Trust Agreement ..................................... 52
ARTICLE X MISCELLANEOUS PROVISIONS ............................ 54
Section 1 General Limitations ................................. 54
Section 2 Top Heavy Provisions ................................ 55
Section 3 Information and Communications ...................... 58
Section 4 Small Account Balances .............................. 59
Section 5 Amounts Payable to Incompetents,
Minors or Estates ............................. 59
Section 6 Non-alienation of Amounts Payable ................... 59
Section 7 Unclaimed Amounts Payable ........................... 59
Section 8 Leaves of Absence ................................... 60
Section 9 Return of Contributions to Employer ................. 61
Section 10 Controlling Law ..................................... 61
ARTICLE XI TERMINATION OF EMPLOYER PARTICIPATION ............... 62
Section 1 Termination by Employer ............................. 62
Section 2 Termination by Board ................................ 62
Section 3 Termination Distribution ............................ 62
ARTICLE XII AMENDMENT OR TERMINATION OF THE PLAN AND
TRUST ......................................... 63
TRUSTS ESTABLISHED UNDER THE PLAN ...................................... 64
PURPOSE
The purpose of the Financial Institutions Thrift Plan (the "Plan") is to
provide Members of participating Employers with a convenient way to save on a
regular and long-term basis and, in addition to, or in lieu of such benefit, a
benefit under a Profit Sharing Feature, all as elected by the Employer, and as
set forth herein and in the Trust Agreement adopted as a part of this Plan. This
Plan, as hereby amended and restated, and the Trust established hereunder, are
intended to qualify as a plan and trust which meet the requirements of Sections
401(a), 401(k), and 501(a), respectively, of the Internal Revenue Code, as
now in effect or hereafter amended, or any other applicable provisions of law
including, without limitation, the Employee Retirement Income Security Act of
1974, as amended.
Effective December 31, 2001, except as otherwise provided, the Plan is hereby
amended and restated in its entirety to provide as follows;
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ARTICLE I DEFINITIONS
The following words and phrases as used in this Plan shall have the
following meanings:
1. "ACCOUNT" means the Plan account established and maintained in respect of
each Member pursuant to Article V, including the Member's 401(k) Account,
Regular Account, Rollover Account (including Profit Sharing Rollover
Amounts), Safe Harbor CODA Account, and Profit Sharing Account.
2. "ACTUAL DEFERRAL PERCENTAGE TEST SAFE HARBOR" means the method described
in Section 4(J) of Article III for satisfying the actual deferral
percentage test of Section 401(k)(3) of the Code.
3. "ACTUAL DEFERRAL PERCENTAGE TEST SAFE HARBOR CONTRIBUTIONS" means Employer
matching contributions and non-elective contributions described in Section
4(J) of Article III.
4. "BASIC AMOUNTS" means, with respect to a Member, the contributions made on
behalf of the Member by the Employer pursuant to Article III, Section 2(B)
and earnings thereon.
5. "BENEFICIARY" means the person or persons designated to receive any amount
payable under the Plan upon the death of a Member. Such designation may be
made or changed only by the Member on a form provided by, and filed with,
the Board prior to his death. If the Member is not survived by a Spouse
and if no Beneficiary is designated, or if the designated Beneficiary
predeceases the Member, then any such amount payable shall be paid to such
Member's estate upon his death.
6. "BOARD" means the Board of Directors provided for in Article IX, Section
1.
7. "BREAK IN SERVICE" means a Plan Year during which an individual has not
completed more than 500 Hours of Employment, as determined by the Board in
accordance with the IRS Regulations. Solely for purposes of determining
whether a Break in Service has occurred, an individual shall be credited
with the Hours of Employment which such individual would have completed
but for a maternity or paternity absence, as determined by the Board in
accordance with this Article I, Paragraph (5), the Code and the applicable
regulations issued by the DOL and the IRS; provided, however, that the
total Hours of Employment so credited shall not exceed 501 and the
individual timely provides the Board with such information as it may
require. Hours of Employment credited for a maternity or paternity absence
shall be credited entirely (i) in the Plan Year in which the absence began
if such hours of Employment are necessary to prevent a Break in Service in
such year, or (ii) in the following Plan Year. For purposes of this
Article I, Paragraph (5), maternity or paternity absence shall mean an
absence from work by reason of the individual's pregnancy, the birth of
the individual's child or the placement of a child with the
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individual in connection with the adoption of the child by such
individual, or for purposes of caring for a child for the period
immediately following such birth or placement.
8. "CODE" means the Internal Revenue Code of 1986, as now in effect or as
hereafter amended. All citations to sections of the Code are to such
sections as they may from time to time be amended or renumbered.
9. "COMMENCEMENT DATE" means the date on which an Employer begins to
participate in the Plan.
10. "CONTRIBUTION DETERMINATION PERIOD" means the Plan Year, fiscal year, or
calendar or fiscal quarter, as elected by an Employer, upon which
eligibility for and the maximum permissible amount of any contribution to
the Profit Sharing Feature, as defined in Article III, Section 8, is
determined. Notwithstanding the foregoing, for purposes of Article VI,
Section 2(B)(2), Contribution Determination Period means the Plan Year.
11. "DISABILITY" means a Member's disability as defined in Article VII,
Section 4.
12. "DOL" means the United States Department of Labor.
13. "EMPLOYEE" means any person in the Employment of, and who receives a
salary from, an Employer, and any leased employee within the meaning of
Section 414(n)(2) of the Code, unless the Employer elects to exclude
leased employees from participation of the Plan under Article II, Section
2(H). Notwithstanding the foregoing, if such leased employees constitute
less than twenty percent (20%) of the Employer's nonhighly compensated
workforce within the meaning of Section 414(n)(5)(C)(ii) of the Code, such
leased employees are not Employees if they are covered by a plan meeting
the requirements of Section 414(n)(5)(B) of the Code. A director of the
Employer is not eligible to participate in the Plan unless he is also an
Employee.
14. "EMPLOYER" means any entity which has adopted the Plan in accordance with
Article II, Section 1.
15. "EMPLOYMENT" means all periods of service with an Employer 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 of less than
12 consecutive months. Fractional periods of a year will be expressed in
terms of days.
For purposes of this Section (15), hour of service shall mean each hour
for which an Employee is paid or entitled to payment for the performance
of duties for an Employer.
Break in service is a period of severance of at least 12 consecutive
months.
Period of severance is a continuous period of time during which the
Employee is not employed by an Employer. Such period begins on the date
the Employee retires, quits or is discharged, or if earlier, the 12 month
anniversary of the date on which
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the Employee was otherwise first absent from service.
If an Employer is a member of an affiliated service group (under Section
414(m) of the Code), a controlled group of corporations (under Section
414(b) of the Code), a group of trades or businesses (under Section 414(c)
of the Code), or any other entity required to be aggregated with the
Employer pursuant to Section 414(o) of the Code, service will be credited
for any employment for any period of time for any other member of such
group. Service will also be credited for any individual required under
Section 414(n) or Section 414(o) to be considered an employee of any
Employer aggregated under Section 414(b), (c), or (m).
In the case of an Employee who is absent from work for maternity or
paternity reasons, the 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 Employee, (2) by reason of the birth of a child of the
Employee, (3) by reason of the placement of a child with the Employee in
connection with the adoption of such child by such Employee, or (4) for
purposes of caring for such child for a period beginning immediately
following such birth or placement.
Solely for purposes of determining vesting, "Employment" shall include
service performed by an individual for an Employer or members of an
affiliated service group (under Code Section 414(m)), a controlled group
of corporations (under Code Section 414(b)), or a group of trades or
businesses under common control (under Code Section 414(c)), of which the
Employer is a member, during the period such individual is not a member of
a class of Employees otherwise eligible to participate in the Plan.
16. "ENROLLMENT DATE" means the date on which an Employee becomes a Member as
provided under Article II, Section 2.
17. "ERISA" means the Employee Retirement Income Security Act of 1974, as now
in effect or as hereafter amended.
18. "401(k) ACCOUNT" means the Plan account established and maintained in
respect of a Member pursuant to Article III, Section 4 and Article V, and
shall include all amounts (and earnings thereon) credited thereto on
behalf of the Member pursuant to the provisions of Article III.
19. "HIGHLY COMPENSATED EMPLOYEE" or "HIGHLY COMPENSATED MEMBER" means for
Plan Years beginning after December 31, 1996, an Employee or a Member (i)
who is a 5 percent owner at any time during the look-back year or
determination year, or (ii) (a) who is employed during the determination
year and who during the look-back year received compensation from the
Employer in excess of $80,000 (as adjusted pursuant to the Code and
Regulations for changes in the cost of living), and (b) if elected by the
Employer was in the top-paid group of Employees for such look-back year.
For this purpose, the determination year shall be the Plan Year. The
look-back year shall be the 12-month period immediately preceding the
determination year.
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The top-paid group shall consist of the top 20 percent of the Employees
when ranked on the basis of compensation paid by the Employer.
The determination of who is a Highly Compensated Employee will be made in
accordance with Section 414(q) of the Code and the IRS Regulations
thereunder.
20. "HOUR OF EMPLOYMENT" means
(A) Each hour for which an Employee is paid, or entitled to payment,
for the performance of duties for an Employer. These hours will be
credited to the Employee for the computation period in which the duties
are performed; and
(B) Each hour for which an Employee is paid, or entitled to payment,
by an Employer on account of a period of time during which no duties are
performed (irrespective of whether the employment relationship has
terminated) due to vacation, holiday, illness, incapacity (including
disability), layoff, jury duty, military duty or leave of absence. No more
than 501 Hours of Employment will be credited under this Subsection (B)
for any single continuous period (whether or not such period occurs in a
single computation period). Hours under this Subsection (B) will be
calculated and credited pursuant to Section 2530.200b-2 of the DOL
Regulations which is incorporated herein by this reference; and
(C) Each hour for which back pay, irrespective of mitigation of
damages, is either awarded or agreed to by an Employer. The same Hours of
Employment will not be credited both under Subsection (A) or (B), as the
case may be, and under this Subsection (C). These hours will be credited
to the Employee for the computation period or periods to which the award
or agreement pertains rather than the computation period in which the
award, agreement or payment is made.
Hours of Employment will be credited for employment with other
members of an affiliated service group (under Code Section 414(m)), a
controlled group of corporations (under Code Section 414(b)), or a group
of trades or businesses under common control (under Code Section 414(c)),
of which the Employer is a member, and any other entity required to be
aggregated with such Employer pursuant to Code Section 414(o).
Hours of Employment will also be credited for any individual
considered an Employee for purposes of the Plan under Code Section 414(n)
or Section 414(o).
Solely for purposes of determining eligibility to participate, "Hour
of Employment" shall include service performed by an individual for an
Employer or members of an affiliated service group (under Code Section
414(m)), a controlled group of corporations (under Code Section 414(b)),
or a group of trades or businesses under common control (under Code
Section 414(c)), of which the Employer is a member, during the period such
individual is not a member of a class of Employees otherwise eligible to
participate in the Plan.
21. "IRS" means the United States Internal Revenue Service.
22. "LEAVE OF ABSENCE" means an absence authorized by an Employee's Employer
on a uniform basis, in accordance with Article X, Section 8.
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23. "MATCHING AMOUNTS" means, with respect to a Member, the contributions made
on behalf of the Member by the Employer pursuant to Article III, Section
2(A) and earnings thereon.
24. "MEMBER" means an Employee enrolled in the membership of the Plan under
Article II, Section 2. Notwithstanding the foregoing, Member shall include
a former Member, except for purposes of Article III (other than Section 6
thereof) of the Plan.
25. "MONTH" means any calendar month.
26. "NON-HIGHLY COMPENSATED EMPLOYEE" means an Employee who is not a Highly
Compensated Employee.
27. "NORMAL RETIREMENT AGE" means the Member's sixty-fifth (65th) birthday.
28. "PLAN" means the Financial Institutions Thrift Plan established herein and
as from time to time amended.
29. "PLAN YEAR" means a 12-month period ending December 31.
30. "PROFIT SHARING ACCOUNT" means the Plan account established in respect of
each Member pursuant to Article III, Section 8(B)(2) and Article V which
shall be maintained separate from any other Account established in respect
of such Member under the Plan. Except as otherwise indicated under the
Plan, a Member's Profit Sharing Account shall not include his Profit
Sharing Rollover Amounts.
31. "PROFIT SHARING ROLLOVER AMOUNTS" means, with respect to an Employee or
Member whose Employer participates in the Plan solely under Article III,
Section 8 (Profit Sharing Feature), any amounts (and earnings thereon)
transferred or contributed on behalf of such Employee or Member pursuant
to Article III, Section 6(C).
32. "REGULAR ACCOUNT" means the Plan account established and maintained in
respect of a Member pursuant to Article III, Section 2(C) and Article V,
and shall include all amounts (and earnings thereon) credited thereto on
behalf of the Member pursuant to the provisions of Article III.
33. "REGULATIONS" means the applicable regulations issued under the Code,
ERISA or other applicable law, by the IRS, the DOL or any other
governmental authority and any proposed or temporary regulations or rules
promulgated by such authorities pending the issuance of such regulations.
34. "ROLLOVER ACCOUNT" means the Plan account established in respect of each
Member pursuant to Article III, Section 6(C) and Article V which shall be
maintained separate from any other Account established in respect of such
Member under the Plan. For purposes of Article III, Section 4(H), Article
VII, Sections 1 and 2, and Article VIII, a Member's Rollover Account shall
not include his Profit Sharing Rollover Amounts, unless otherwise
indicated therein.
35. "SAFE HARBOR CODA ACCOUNT" means the Plan account established in respect
of each Member pursuant to Article III, Section 4(J) and Article V which
shall be maintained separate from any other Account established in respect
of such Member under the Plan.
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36. "SALARY" means regular basic monthly salary or wages, exclusive of special
payments such as overtime, bonuses, fees, deferred compensation (other
than amounts deferred pursuant to a Member's election under Article III,
Section 4), severance payments, and contributions by the Employer under
this or any other plan (other than before-tax contributions made on behalf
of a Member under a Code Section 125 cafeteria plan or contributions made
under Code Section 132(f), unless the Employer specifically elects to
exclude such contributions). Commissions shall be included at the
Employer's option within such limits, if any, as may be set by the
Employer and applied uniformly to all its commission Employees. In
addition, Salary may also include, at the Employer's option, special
payments such as (i) overtime or (ii) overtime plus bonuses. If an
Employer elects to include the special payments enumerated in (i) or (ii)
above in the definition of Salary or, if the Employer elects to include
commissions in the definition of Salary, such Salary shall be determined
based on the amounts received by the Member during the relevant
determination period. Otherwise, unless an Employer specifically requests
to include Salary changes received by a Member during the relevant
determination period and is granted permission by the Board, a Member's
monthly Salary rate is one-twelfth of his annual Salary rate as of each
January 1. If commissions are included in Salary, unless an Employer
specifically requests to include commissions received by a Member during
the relevant determination period and is granted permission by the Board,
they shall be calculated on a uniform basis based on the commissions
received by the Member during the 12-month period prior to the
determination period. As an alternative to the foregoing definition, at
the Employer's option, Salary may be defined to include total taxable
compensation reported on the Member's IRS Form W-2, plus deferrals, if
any, pursuant to Section 401(k) of the Code, Section 125 of the Code, and
pursuant to Section 132(f) of the Code (unless the Employer specifically
elects to exclude such Section 125 and/or Section 132(f) deferrals), but
excluding compensation deferred from previous years. In no event, may a
Member's Salary for any Plan Year exceed for purposes of the Plan $200,000
or, effective January 1, 1994, $150,000 (adjusted for cost of living to
the extent permitted by the Code and the IRS Regulations).
For Plan Years beginning after December 31, 1996, and for all purposes
under the Plan, the family member aggregation rules of Code Section
414(q)(6) (as in effect prior to the Small Business Job Protection Act of
1996) are eliminated.
Effective for Plan Years beginning after December 31, 2001, the annual
Salary of each Member taken into account in determining allocations, shall
not exceed $200,000 as adjusted for cost-of-living increased in accordance
with Section 401(a)(17)(B) of the Code.
37. "SPOUSE" or "SURVIVING SPOUSE" means the individual to whom a Member or
former Member was married on the date such Member withdraws his Account,
or if such Member has not withdrawn his Account, the individual to whom
the Member or former Member was married on the date of his death.
38. "SUPPLEMENTAL AMOUNTS" means, with respect to a Member, the contributions
made on behalf of the Member by the Employer pursuant to Article III,
Section 3 and earnings thereon.
39. "TRUSTEE" means the Trustee or Trustees provided for in Article IX,
Section 2.
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40. "TRUST FUND" means the Trust Fund or Funds established by the Trust
Agreement or Agreements provided for in Article IX, Section 2.
41. "UNIT" means the unit of measure described in Article V of a Member's
proportionate interest in the Plan's Investment Funds.
42. "VALUATION DATE" means any business day of any month for the Trustee,
except that in the event the underlying portfolios of any Investment Fund
cannot be valued on such date, the Valuation Date for such Investment Fund
shall be the next subsequent date on which the underlying portfolio(s) can
be valued. Valuations shall be made as of the close of business on such
valuation date(s).
43. "YEAR OF EMPLOYMENT" means a 12-month period of Employment.
44. "YEAR OF SERVICE" means any Plan Year during which an individual completed
at least 1,000 Hours of Employment, or satisfied any alternative
requirement, as determined by the Board in accordance with any applicable
regulations issued by the DOL and the IRS.
45. The masculine pronoun wherever used shall include the feminine pronoun.
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ARTICLE II PARTICIPATION AND MEMBERSHIP
SECTION 1. EMPLOYER PARTICIPATION.
Any financial institution, or other organization serving it, may apply to the
Board for participation in the Plan if: (A) as of its Commencement Date and in
accordance with Section 410(b) of the Code and the IRS Regulations (i) the
percentage of Non-highly Compensated Employees who will benefit under the Plan
is at least 70% of the percentage of Highly Compensated Employees who will
benefit under the Plan (excluding such employees as are permitted to be excluded
under IRS Regulations), or (ii) the average benefit percentage test (as defined
in Section 410(b)(2) of the Code and the IRS Regulations) will be satisfied with
respect to the Employer. The applicant shall submit the formal application and
all required information, and the Board, in its discretion, shall decide upon
admittance and determine the Commencement Date. The Board may, in its discretion
and at such times as it may determine, require an affirmative showing by an
Employer of its continued compliance with the requirements of Section 410(b) of
the Code and IRS Regulations. Initial and continued participation shall be
subject to the determination of the IRS that the Plan and the Trust Fund are
tax-qualified and tax-exempt under Sections 401(a) and 501(a) of the Code,
respectively. In addition, any Employee who participated in the Plan but who has
been transferred to a governmental or quasi-governmental agency serving the
financial industry shall, notwithstanding anything to the contrary in this
Section, be permitted to continue to participate in the Plan; provided that, in
such case, such Employee's employing agency has adopted the Plan.
An Employer may, at its option, subject to the provisions of the Plan, adopt
different Plan features and provisions (basis of participation) for different
definable groups of employees, including for employees acquired pursuant to a
merger or acquisition. The Employer will be required to demonstrate that this
Section 1 and all other applicable Code and IRS Regulations continue to be
satisfied following the adoption of different basis of participation for
separate and definable groups of employees.
SECTION 2. EMPLOYEE MEMBERSHIP.
(A) Employer contributions on behalf of any Member shall be conditioned upon
the Member making contributions under Article III, Section 1, except in
the case of the basic contribution feature described in Article III,
Section 2; the supplemental contribution feature (Formula (2)) described
in Article III, Section 3; the 401(k) Feature described in Article II,
Section 4(B); the Safe Harbor CODA non-elective contribution feature
described in Article III, Section 4(J); or the Profit Sharing Feature
described in Article III, Section 8.
(B) Every Employee (other than Employees who, at the election of the Employer,
are excluded from participation under this Section 2) shall be eligible
for membership in the Plan on the later of:
(1) His Employer's Commencement Date, or
(2) The first day of the month coincident with or next following his
satisfaction of one or more of the eligibility requirements
described hereunder, as designated by his Employer: (i) the
completion of any number of months not to exceed 12 consecutive
months or (ii) the completion of one Year of Service or two Years of
Service, and/or (iii) if the Employer so elects, it may adopt a
minimum age
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requirement from age 18 to age 21. An Employer, at its election and
in a uniform and nondiscriminatory manner, may waive the eligibility
requirement(s) for participation specified under this paragraph (B)
for (1) all Employees, or (2) all those Employees employed on or up
to 12 months after the Employer's Commencement Date under the Plan.
The eligibility requirement(s) designated by the Employer shall
apply uniformly to all Plan Features elected by the Employer.
Notwithstanding the foregoing, the Employer may elect to establish
as an eligibility requirement (as a minimum service requirement,
minimum age requirement, or both) for Employer matching
contributions, Employer basic contributions, Employer supplemental
contributions, Employer Safe Harbor CODA contributions, and/or
Employer Profit Sharing contributions (i) the completion of any
number of months not to exceed 12 consecutive months, or (ii) the
completion of one 12-consecutive-month period, and/or (iii) if the
Employer so elects, it may adopt a minimum age requirement from age
18 to age 21. If, pursuant to Section 410(b)(4)(B), the Employer
applies Code Section 410(b) separately to the portion of the Plan
(within the meaning of Code Section 414(l)) that benefits only
Employees who satisfy the eligibility requirements of this Section 2
that are lower than age twenty-one (21) and completion of a Year of
Service, the Plan is treated as two separate plans for purposes of
Code Section 401(k). Accordingly, if the Employer elects to make a
Safe Harbor CODA contribution, then such contribution shall not be
made on behalf of Employees who have not attained age twenty-one
(21) and completed a Year of Service. However, in such a case,
Section 401(k) elective deferrals and the matching contribution
made pursuant to Article III, Section 2(A) on behalf of those
Employees must satisfy Article III, Sections 4(D), (E), (F) and (G)
and Article III, Section 7.
Subject to the requirements of the Code, where an Employee who
participated as a Member under the Plan terminates employment with
an Employer and thereafter is reemployed by the same (or a
different) Employer, such Employee, subject to any applicable break
in service rules, shall participate immediately upon returning to
employment with respect to the Profit Sharing Feature and the Basic
and Supplemental Employer contribution and shall participate on the
next applicable payroll date with respect to Member contributions,
Matching Employer contributions, Employer Safe Harbor CODA
contributions and the 401(k) Feature, as and to the extent any such
contribution feature is then maintained by such Employee's Employer
and the Member has satisfied the eligibility requirements for
receiving such Employer contributions and, as applicable, making
such Member contributions. In the case of an Employer that adopts a
401(k) Feature under Article III, Section 4, the eligibility
requirement(s) under such Feature shall not exceed the period
described in clause (i) in the preceding paragraph, and, at the
election of the Employer, attainment of an age as elected by the
Employer from age 18 to age 21 as described in clause (iii) in the
preceding paragraph. In the event a Member is no longer part of an
eligible class of Employees and thus becomes ineligible to
participate in the Plan, such Employee, subject to any applicable
break in service rules, shall participate immediately upon returning
to an eligible class of Employees with respect to the Profit Sharing
Feature and the Basic and Supplemental Employer contribution and
shall participate on the next applicable payroll date with respect
to Member contributions, Matching Employer contributions, Employer
Safe Harbor CODA contributions, and the 401(k) Feature, as and to
the extent any such contribution feature is then maintained by such
Employee's Employer and the
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Member has satisfied the eligibility requirements for receiving such
Employer contributions and, as applicable, making such Member
contributions.
(C) Where an Employer designates a one Year of Service or two Years of Service
eligibility requirement, an Employee must complete at least 1,000 Hours of
Employment during each 12-consecutive-month eligibility computation period
(measured from his date of Employment and then from each January 1,
thereafter). Where an Employer designates an eligibility waiting period of
less than 12 months, an Employee must, for purposes of eligibility,
complete a required number of hours (measured from his date of Employment
and each anniversary thereafter) which is arrived at by multiplying the
number of months of the eligibility waiting period requirement by 83 1/3;
provided, however, if the Employee completes at least 1,000 Hours of
Employment during the 12-consecutive month eligibility computation period
(measured from his date of Employment and then from each January 1
thereafter) the Employee shall be deemed to satisfy the eligibility
waiting period designated by the Employer.
(D) (1) The Employer shall notify each Employee of his membership in the
Plan and shall furnish him with an enrollment application in order
that he may elect to make or receive contributions on his behalf
under Article III at the earliest possible date consonant with this
Article.
(2) All Employees whose Employment commences after the expiration date
of the Employer's waiver of the eligibility requirement(s) shall be
enrolled in the Plan in accordance with the eligibility
requirement(s) designated in Paragraph (B) above.
(3) If it is determined that an Employee who is eligible to be enrolled
has, for any reason, not been so notified, such Employee shall be
furnished an application by his Employer and be retroactively
enrolled, as of the date he first became eligible, upon receipt by
the Board of the application properly executed. In such event, the
Employee may, at his election and in accordance with applicable law,
make any contributions which he could have made had he been enrolled
on such date. The Employer will be required to make the
contributions (without Plan earnings thereon) it would have made had
the Employee been enrolled on such earlier date. The Account of an
Employee who is retroactively enrolled shall, upon such enrollment,
consist solely of the number of Units which, as of the Valuation
Date coincident with or next following such enrollment, may be
credited to him pursuant to Article V based upon the amount of
contributions received by the Board.
(E) An Employee shall become a Member on his Enrollment Date which shall be
the date on which he becomes eligible. However, no person shall under any
circumstances become a Member unless and until his enrollment application
is filed with, and accepted by, the Plan. If an Employee fails to complete
the enrollment form furnished to him, the Employer shall do so on his
behalf. In the event the Employer submits the enrollment form on behalf of
the Employee, the Employee shall be deemed to have elected not to make any
contributions under the Plan.
(F) At the option of the Employer, an Employee who is employed as of his
Employer's Commencement Date may make a one time election to waive
participation in the Plan on the Employer's Commencement Date.
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(G) Membership under all provisions of the Plan shall terminate upon the
earlier of (a) a Member's termination of Employment and payment to him of
his entire vested interest, or (b) his death.
(H) The following Employees, at the Employer's election, may be excluded from
participation in the Plan:
(i) Employees who are included in a unit of Employees covered by a
collective bargaining agreement between the Employee
representatives and one or more Employers if there is evidence
that retirement benefits were the subject of good faith
bargaining between such Employee representatives and such
Employer(s). For this purpose, the term "Employee
representative" does not include any organization where more
than one-half of the membership is comprised of owners,
officers and executives of the Employer;
(ii) Employees who are non-resident aliens and who receive no
earned income from the Employer which constitutes income from
sources within the United States;
(iii) Employees who are employed on an hourly basis.
Notwithstanding, if the Employee is employed on an hourly
basis following the adoption date of the Plan by the Employer,
but prior to the adoption of an hourly exclusion by his
Employer, such employee shall continue to receive benefits on
the same basis as a regular salaried Member, despite
classification as an hourly employee unless the employee is
otherwise excluded from participation in the Plan at the
election of the Employer under this Section 2(H). In the event
an individual who was not part of an eligible class of
Employees becomes part of an eligible class, such individual
will be eligible to participate in the Plan in accordance with
the provisions of this Article II on a prospective basis;
(iv) Employees who are not regular full-time or part-time Employees
(Flex Staff Employees);
(v) Leased Employees within the meaning of Section 414(n)(2) of
the Code; and
(vi) Employees hired under a written agreement which precludes
membership and provides for a specific period of employment
not in excess of one year.
-11-
ARTICLE III CONTRIBUTIONS
SECTION 1. CONTRIBUTIONS BY MEMBERS.
Under this Section, a Member may elect to make contributions under the Plan (in
1% increments) up to a maximum percentage specified by the Employer not to
exceed 20% of his Salary, provided that the sum of such maximum percentage plus
the maximum matching and/or basic contribution may not exceed 25% of Salary,
except as provided under Section 4(B). Effective January 1, 2002, a Member may
elect to make a contributions under the Plan (in 1% increments) up to a maximum
percentage specified by the Employer not to exceed 50% of his Salary. He may
change his contribution rate or suspend his contributions at any time, but
reduced or suspended contributions may not subsequently be made up.
SECTION 2. REGULAR CONTRIBUTIONS BY EMPLOYER.
(A) MATCHING EMPLOYER CONTRIBUTIONS
Under this Section, an Employer shall contribute monthly to the Plan on
behalf of each of its Members (subject to any possible suspension under
Article VII) an amount equal to a percentage (as specified by the
Employer) of the Member's contributions not in excess of a maximum of 15%
(as specified by the Employer) of his Salary. The percentage chosen by the
Employer shall be in accordance with the schedule of contribution formulas
listed below. Such contribution formula must be uniformly applicable to
all its Members, except where the Employer has elected to provide a
separate basis of participation for different definable groups of
employees under the Plan.
Formula 0 - 0% of the Member's contributions.
Formula 25 - 25% of the Member's contributions.
Formula 50 - 50% of the Member's contributions.
Formula 75 - 75% of the Member's contributions.
Formula 100 - 100% of the Member's contributions.
Formula Step (1) - (i) 50% of the Member's contributions through
the third year of Employment.
(ii) 75% of the Member's contributions during the
fourth and fifth years of Employment.
(iii) 100% of the Member's contributions upon
completion of 5 or more years of Employment.
Formula Step (2) - (i) 100% of the Member's contributions through
the third year of Employment.
(ii) 150% of the Member's contributions during
the fourth and fifth years of Employment.
-12-
(iii) 200% of the Member's contributions upon
completion of 5 or more years of Employment.
Formula Step (3) - A percentage of the Member's contributions chosen
by the Employer through the Member's third year of
Employment with an increased percentage of the
Member's contributions as elected by the Employer
to apply during the fourth and fifth years of
Employment and a further increased percentage of
the Member's contributions upon completion of 5 or
more years of Employment.
Formula 150 - 150% of the Member's contributions.
Formula 200 - 200% of the Member's contributions.
Notwithstanding the matching formulas provided above, an Employer may at its
option, specify the percentage of the Member's contributions which will be
matched by the Employer.
(B) BASIC EMPLOYER CONTRIBUTIONS
An Employer may, at its option, make a basic contribution equal to a
uniform percentage (as specified by the Employer) of each of its Members'
Salaries for each month, provided that in no event shall such percentage
exceed 15%. The percentage so specified may be elected or changed by the
Employer by filing a properly completed form with the Thrift Plan Office.
No more than one such change may be made by an Employer during any year.
An Employer may restrict the allocation of such basic contribution to
those Members who were employed with the Employer on the last working day
of the month for which the basic contribution is made.
At the election of the Employer, any basic contribution shall be credited
to its Members' 401(k) Accounts or Regular Accounts on a uniform basis.
(C) REGULAR ACCOUNTS
A Regular Account shall be established and maintained for each Member on
whose behalf contributions are made to the Plan pursuant to Section 1 or 2
of this Article.
SECTION 3. SUPPLEMENTAL CONTRIBUTIONS BY EMPLOYER.
An Employer may, at its option, make a supplemental contribution under Formula
(1) or (2) below:
FORMULA (1) - A uniform percentage (as specified by the Employer) of each
Member's contributions, not in excess of a maximum percentage (if the Employer
elects to impose such a maximum) of the Member's Salary, which were received by
the Plan during the preceding Plan Year, Such supplemental contribution may be
made on or before the last day of February in any year on behalf of all those
Members who were in its employ on the last working day of the preceding Plan
Year, For purposes of this Formula (1), Members
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on a Type 1 non-military Leave of Absence (as defined under Article I, Paragraph
(22) and Article X, Section 8(B)(1)), or a Type 4 military Leave of Absence (as
defined under Article I, Paragraph (22) and Article X, Section 8(B)(4)), shall
be deemed employed on the last working day of such preceding Plan Year.
FORMULA (2) - A uniform dollar amount per Member or a uniform percentage limited
to a specific dollar amount, if elected by the Employer, of each Member's Salary
(i) for the preceding Plan Year or fiscal year of the Employer, regardless of
whether the Member was eligible to participate in the Plan during the entire
Plan Year (or fiscal year of the Employer), or (ii) if an Employer so elects
with respect to all of its Members, for the portion of the preceding Plan Year
(or fiscal year of the Employer) during which the Member was eligible to
participate in the Plan. Such supplemental contribution shall be made within the
time prescribed by law, including extensions of time, for filing of the
Employer's federal income tax return on behalf of all those Members who were in
its employ on the last working day of the preceding Plan Year (or, at the
Employer's option, the Employer's fiscal year). The Employer may, at its option,
elect to make a contribution under this paragraph to only those Members whose
Salary is less than an amount to be specified by the Employer to the extent that
such Salary limit is less than the dollar amount under Section 414(q)(1) of the
Code for such year.
For purposes of this Formula (2), Members on a Type 1 non-military Leave of
Absence (as defined under Article I, Paragraph (22) and Article X, Section
8(B)(1)), or a Type 4 military Leave of Absence (as defined under Article I,
Paragraph (22) and Article X, Section 8(B)(4)), shall be deemed employed on the
last working day of such preceding Plan Year (or fiscal year of the Employer).
The percentage contributed under this Formula (2) shall be limited in accordance
with the Employer's matching formula and basic contribution rate under Section 2
of this Article such that the sum of the Employer's Formula (2) supplemental
contribution plus the Employer basic contribution and the maximum Employer
matching contribution under Section 2 of this Article shall not exceed 15% of
Salary for such year.
At the election of the Employer, any supplemental contribution shall be credited
either to its Members' 401(k) Accounts or Regular Accounts on a uniform and
nondiscriminatory basis.
SECTION 4. 401(K) FEATURES.
(A) An Employer may, at its option, adopt either the 401(k) Feature under
Paragraph (B) of this Section or one of the 401(k) Features described in
Paragraph (C) of this Section. Under any 401(k) Feature, there shall be
established for each of its Members a "401(k) Account." (For purposes of
this Section, the "401(k) Account" and the "Regular Account" shall
comprise the Member's Account as defined in Article I, Paragraph (1).) A
Member's 401(k) Account shall be invested pursuant to his overall
directions under Article IV but maintained separately from his Regular
Account (consisting of the value of contributions made under Section 1,
and as elected by the employer, Sections 2(B) and 3 of this Article). A
Member contributing under this 401(k) Feature shall be permitted to make
deferrals for a Plan Year based upon a uniform percentage (in whole
percentages) of his Salary so that the Member may reach the Code Section
402(g) limit by the end of the Plan Year. Should such Member not reach the
Code Section 402(g) limit by the last contribution reporting period in a
Plan Year, the Member will be permitted to make a final 401(k)
contribution which will enable a Member to precisely reach the limit under
Section 402(g) of the Code. Such final contribution may be made based on a
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percentage of the Member's Salary which is not a whole percentage.
(B) OPTION 1 - Under the 401(k) Feature provided in this Paragraph (B), each
Member may elect to defer 1 % up to a maximum percentage specified by the
Employer not to exceed 20% (in 1 % increments) of his Salary and direct
his Employer to contribute such amount to his 401(k) Account. Effective
January 1, 2002, each Member may elect to defer 1 % up to a maximum
percentage specified by the Employer not to exceed 50% (in 1 % increments)
of his Salary and direct his Employer to contribute such amount to his
401(k) Account. Such deferral to the 401(k) Account shall reduce the
Member's contribution under Section 1 of this Article.
The Employer shall contribute to each Member's 401(k) Account an amount
equal to 2% of his Salary not in excess of $3,750, subject to Article X,
Section 1 of the Plan, unless the Member has deferred amounts of his
Salary pursuant to the preceding paragraph, in which case the Employer's
2% contribution will be allocated to the Member's Regular Account. The
amount which the Employer would otherwise be required to contribute with
respect to each Member under Section 2 of this Article shall be reduced,
but not below zero, by the amount which it contributes with respect to the
Member under this Paragraph (B). Notwithstanding anything in this
Paragraph to the contrary, should a Member's deferrals to the 401(k)
Account reach the maximum specified under the provisions of Paragraph (I)
below in any Plan Year, the Employer's 2% contribution will be allocated
to the Member's Regular Account for the remainder of such Plan Year.
The Employer, at its option, may adopt either of the two additional 401(k)
Features described below:
(C) OPTION 2 - Under this Feature, each Member, at his election, may make
deferrals to his 401(k) Account and/or contributions to his Regular
Account, in an amount of 1 % up to a maximum specified by the Employer not
to exceed 20% (in 1 % increments) of his Salary, except that amounts
deferred to the 401(k) Account shall reduce the Member's contribution
under Section 1 of this Article, Effective January 1, 2002, each Member
may elect to make deferrals to his 401(k) Account and/or contributions to
his Regular Account in an amount of 1 % up to a maximum percentage
specified by the Employer not to exceed 50% (in 1 % increments) of his
Salary, except that amounts deferred to the 401(k) Account shall reduce
the Member's contribution under Section 1 of this Article. Amounts
contributed under this Option 2 may be allocated between the 401(k)
Account and/or the Regular Account based on multiples of 1%.
If so adopted, Employer contributions under the Plan, which shall be made
on behalf of each Member in an amount equal to a percentage of the
Member's deferrals to his 401(k) Account and contributions to his Regular
Account as specified by the Employer under Section 2 of Article III of his
Salary, shall first be allocated to a Member's 401(k) Account until total
Member deferrals and Employer contributions allocated to the Member's
401(k) Account equal a percentage specified by the Employer. Thereafter,
the Employer contributions, with respect to both Member 401(k) deferrals
and Regular contributions, other than Employer Contributions allocated to
Member's 401(k) Account pursuant to the preceding sentence, shall be
the contributed to the Member's Regular Account.
Notwithstanding the Employer election made under this Option 2, if the
Member
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has deferred amounts of his Salary equal to the maximum specified under
the provisions of Paragraph (I) below, the Employer shall contribute the
remaining Employer contributions to the Member's Regular Account.
OPTION 3 - Under this Feature each Member may make deferrals to his 401(k)
Account, but not contributions to his Regular Account. The Employer shall
contribute under the Plan on behalf of each Member an amount equal to a
percentage, specified by the Employer under Section 2 of Article III, of
the Member's deferrals to his 401(k) Account. The Employer's contributions
under this Feature shall be made to the Member's Regular Account.
(D) Effective for Plan Years beginning after December 31, 1996, the actual
deferral percentages for Highly Compensated Employees shall, in accordance
with the Code and IRS Regulations, satisfy either (i) or (ii) as follows:
(i) Prior Year Testing:
Notwithstanding any other provision of this Section 4, and unless
the Employer elects to use the Current Year Testing method in clause
(ii) below, the actual deferral percentage for a Plan Year for
Highly Compensated Employees for such Plan Year and the prior year's
actual deferral percentage for Members who were Non-highly
Compensated Employees for the prior Plan Year must satisfy one of
the following tests: (a) the actual deferral percentage for a Plan
Year of those Members who are Highly Compensated Employees for the
Plan Year shall not exceed the prior year's actual deferral
percentage of those Members who are Non-highly Compensated Employees
for the prior Plan Year multiplied by 1.25; or (b) the actual
deferral percentage for a Plan Year for Members who are Highly
Compensated Employees for the Plan Year shall not exceed the prior
year's actual deferral percentage for Members who were Non-highly
Compensated Employees for the prior Plan Year multiplied by 2.0,
provided that the actual deferral percentage (as determined under
this clause (b)) for Members who are Highly Compensated Employees
for the Plan Year shall not exceed the Prior Plan Year's actual
deferral percentage for those Members who were Non-highly
Compensated Employees for the prior Plan Year by more than 2
percentage points.
For the first Plan Year that the Plan permits any Member to make
elective deferrals and where this is not a successor plan, for
purposes of the foregoing tests, the prior year's Non-highly
Compensated Employees' actual deferral percentage shall be 3 percent
unless the Employer has elected to use the current Plan Year's
actual deferral percentage for the Members who are Non-highly
Compensated Employees. The Employer may elect to change from the
Prior Year Testing method to the Current Year Testing method in
accordance with the Code and IRS Regulations.
(ii) Current Year Testing:
If elected by the Employer, the actual deferral percentage tests in
(a) and (b) above will be applied by comparing the current Plan
Year's actual deferral percentage for Members who are Highly
Compensated Employees for such Plan Year with the current Plan
Year's actual deferral percentage for Members who are Non-highly
Compensated Employees for such year. Once made, this election can
only be changed and the Prior Year Testing method applied if the
-16-
Plan meets the requirements for changing to Prior Year Testing set
forth in IRS Notice 98-1 (or superseding guidance).
For purposes of this Section 4, the "actual deferral percentage" for a
Plan Year means, for a specified group of Members for a Plan Year, the
average of the ratios (calculated separately for each Member in such
group) of (a) the amount of deferrals and/or contributions made to the
Member's 401(k) Account for the Plan Year, to (b) the amount of the
Member's compensation (as defined in Section 414(s) of the Code) which, at
the Employer's election, shall be the compensation required to be reported
under Section 6041 or 6051 of the Code (i.e., "W-2 compensation") for the
Plan Year or, alternatively, where specifically elected by the Employer,
for only that part of the Plan Year during which the Member was eligible
to participate in the Plan. A Member's actual deferral percentage shall be
zero if no 401(k) deferral or contribution (allocated to the Member's 401
(k) Account) is made by him or on his behalf for such applicable Plan
Year. If the Plan and one or more other plans which include cash or
deferred arrangements are considered as one plan for purposes of Sections
401(a)(4) and 410(b) of the Code, the cash or deferred arrangements
included in such plans shall be treated as one arrangement for purposes of
this Section 4.
In accordance with IRS Regulations, the actual deferral percentage of a
Member who is a Highly Compensated Employee and who is eligible to
participate in two or more cash or deferred arrangements maintained by his
Employer shall be determined by treating all such cash or deferred
arrangements as a single arrangement.
(E) The Thrift Plan Office shall determine as of the end of the Plan Year
whether one of the actual deferral percentage tests specified in Paragraph
(D) above is satisfied for such Plan Year. This determination shall be
made after first determining the treatment of excess deferrals within the
meaning of Section 402(g) of the Code under Paragraph (I) below. In the
event that neither of such actual deferral percentage tests is satisfied,
the Thrift Plan Office shall, to the extent permissible under the Code and
the IRS Regulations, refund the excess contributions for the Plan Year in
the following order of priority: by (i) refunding such amounts deferred by
the Member and allocated to his 401(k) Account which were not matched by
his Employer (and any earnings and losses allocable thereto), and (ii)
refunding amounts deferred for such Plan Year by the Member and allocated
to his 401(k) Account (and any earnings and losses allocable thereto)
and, in accordance with the Code and applicable IRS Regulations,
forfeiting the amounts contributed for such Plan Year by the Employer with
respect to the Member's 401(k) deferrals that are returned pursuant to
this Paragraph (and any earnings and losses allocable thereto). The
distribution of such excess contributions shall be made to Highly
Compensated Members to the extent practicable before the 15th day of the
third month immediately following the Plan Year for which such excess
contributions were made, but in no event later than the end of the Plan
Year following such Plan Year or, in the case of the termination of the
Plan in accordance with Article XII or termination of Employer
participation in the Plan in accordance with Article XI, no later than the
end of the twelve-month period immediately following the date of such
termination. For purposes of this Section 4, "excess contributions" means,
with respect to any Plan Year, the excess of the aggregate amount of 401
(k) deferrals and/or contributions treated as elective deferrals (and any
earnings and losses allocable thereto) made to the 401(k) Accounts of
Highly Compensated
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Members for such Plan Year, over the maximum amount of such deferrals
and/or contributions that could be made to the 401(k) Accounts of such
Members without violating the requirements of Paragraph (D) above,
determined, in accordance with applicable law (including, as applicable,
IRS Notice 97-2), by reducing 401(k) deferrals and/or contributions made
by or on behalf of Highly Compensated Members in order of the Highly
Compensated Employee with the largest 401(k) amounts for the Plan Year
until such amount is reduced to be equal to the Highly Compensated
Employee with the next largest 401(k) amount. The procedure described in
the preceding sentence shall be repeated until all excess contributions
have been eliminated and, as applicable, refunded.
(F) Notwithstanding any other provision of the Plan, effective for Plan Years
beginning after December 31, 1996, the sum of the actual deferral
percentage determined in accordance with Paragraph (D) above of those
Employees who are Highly Compensated Employees and the actual contribution
percentage determined in accordance with Section 7 of this Article III of
those Employees who are Highly Compensated Employees may not exceed the
aggregate limit as determined below.
For purposes of this Section 4, the "aggregate limit" for a Plan Year is the
greater of:
(1) The sum of:
(a) 1.25 times the greater of the actual deferral percentage of the
Non-highly Compensated Employees for the prior Plan Year or the
actual contribution percentage of the Non-highly Compensated
Employees for the prior Plan Year, and
(b) Two percentage points plus the lesser of the actual deferral
percentage or actual contribution percentage referred to in (a)
above. In no event, however, shall the percentages described in the
proceeding sentence exceed two times the lesser of the relevant
actual deferral percentage or the relevant actual contribution
percentage; or
(2) The sum of:
(a) 1.25 times the lesser of the actual deferral percentage of the
Non-highly Compensated Employees for the prior Plan Year or the
actual contribution percentage of the Non-highly Compensated
Employees for the prior Plan Year, and
(b) Two percentage points plus the greater of the actual deferral
percentage or the actual contribution percentage referred to in (a)
above. In no event, however, shall the percentage described in the
preceding sentence exceed two times the greater of the relevant
actual deferral percentage or the relevant actual contribution
percentage; provided, however, that if a less restrictive limitation
is prescribed by the IRS, such limitation shall be used in lieu of
the foregoing. The calculation of the aggregate limit, as defined
above, shall be determined in accordance with the Code and the IRS
Regulations.
The Thrift Plan Office shall determine as of the end of the Plan Year
whether the aggregate limit has been exceeded. This determination shall be
made after first determining the treatment of excess deferrals within the
meaning of Section 402(g)
-18-
of the Code under Paragraph (I) below, then determining the treatment of
excess contributions under Paragraph (E) above, and then determining the
treatment of excess aggregate contributions under Section 7 of this
Article III. In the event that the aggregate limit is exceeded, the actual
contribution percentage of those Employees who are Highly Compensated
Employees shall be reduced in the same manner as described in Section 7 of
this Article until the aggregate limit is no longer exceeded, unless the
Thrift Plan Office designates, in lieu of the reduction of the actual
contribution percentage a reduction in the actual deferral percentage of
those Employees who are Highly Compensated Employees, which reduction
shall Occur in the same manner as described in Section 4(E) of this
Article until the aggregate limit is no longer exceeded.
If the Employer has elected to use the Current Year Testing method, then,
in calculating the aggregate limit for a particular Plan Year, the
Non-highly Compensated Employees' actual deferral percentage and actual
contribution percentage for that Plan Year, instead of the prior Plan
Year, is used.
Effective for Plan Years beginning after December 31, 2001, the multiple
use test described in Treasury Regulation Section 1.401(m)-2 and this
Section (F) shall be inapplicable.
(G) Notwithstanding the provisions of Paragraphs (D) and (E) above, the amount
of excess contributions to be distributed pursuant to Paragraph (E) above,
with respect to a Member for a Plan Year, shall be reduced by any excess
deferrals distributed to such Member for such Plan Year pursuant to
Paragraph (I) below.
(H) A withdrawal from the vested portion of a Member's 401(k) Account may be
made only upon (a) attainment of age 59 1/2, (b) hardship (as determined
by the Board in accordance with this Paragraph (H)), (c) termination of
Employment, (d) death, (e) Disability or (f) termination of an Employer's
participation in the Plan provided the Employer certifies in writing in
such form as is satisfactory to counsel, in accordance with Section 401
(k)(10) of the Code and applicable Regulations, that no successor defined
contribution plan (other than an employee stock ownership plan as defined
in Section 4975(e)(7) of the Code) will be established or maintained by
the Employer at the time of termination of participation in the Plan or
will be maintained through the period ending twelve months after
distribution of all assets from the Plan attributable to the Employer's
participation in the Plan and amounts distributed upon such event shall be
in the form of a "lump sum distribution" within the meaning of Section
402(e)(4)(D) of the Code (without regard to subclause (I), (II), (III) and
(IV) of clause (i) thereof).
A withdrawal is on account of hardship only if the distribution is both
made on account of an immediate and heavy financial need of the Member and
is necessary to satisfy such financial need, and further provided that no
earnings in the Member's 401(k) Account credited on or after January 1,
1989 and/or Employer contributions made to the Member's 401(k) Account on
or after January 1, 1989 may be distributed in satisfying such need. For
the purposes of this Paragraph (H), the term "immediate and heavy
financial need" shall be limited to the need of funds for (i) the payment
of medical expenses described in Section 213(d) of the Code previously
incurred by the Member, the Member's Spouse, or any of the Member's
dependents (as defined in Section 152 of the Code) or necessary for those
persons to obtain such care, (ii) the payment of tuition and room and
board for the next
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twelve months of post-secondary education of the Member, the Member's
Spouse, the Member's children, or any of the Member's dependents (as
defined in Section 152 of the Code), (iii) the purchase (excluding
mortgage payments) of a principal residence for the Member, or (iv) the
prevention of eviction of the Member from his principal residence or the
prevention of foreclosure on the mortgage of the Member's principal
residence. For purposes of this Paragraph (H), a distribution generally
may be treated as "necessary to satisfy a financial need" if the Employer
reasonably relies upon the Member's written representation that the need
cannot be relieved (i) through reimbursement or compensation by insurance
or otherwise, (ii) by reasonable liquidation of the Member's assets, to
the extent such liquidation would not itself cause an immediate and heavy
financial need, (iii) by cessation of Member 401 (k) deferrals pursuant to
Article III, Section 4 of the Plan or Member Regular contributions
pursuant to Article III, Section 1 of the Plan or (iv) by other
distributions or nontaxable (at the time of the loan) loans from plans
maintained by the Employer or by any other employer, or by borrowing from
commercial sources on reasonable commercial terms. The amount of any
withdrawal pursuant to this Paragraph (H) shall not exceed the amount
required to meet the demonstrated financial hardship, including any
amounts necessary to pay any federal income taxes and penalties reasonably
anticipated to result from the distribution, as certified to the Plan by
the Member.
No amounts may be withdrawn on account of hardship pursuant to this
Paragraph prior to a Member's withdrawal of the remaining vested balance
of his Regular Account and Rollover Account, notwithstanding the
withdrawal restrictions contained in Article VII, Section 2 or below.
Only one in-service withdrawal under this Paragraph may be made in any
Plan Year, and any amounts paid under this Article may not be returned to
the Plan. The amount of a withdrawal under this Paragraph (H) must be not
less than the lesser of (i) $1,000, (ii) the full value of the vested
portion of the 401(k) Account (reduced by the amount of post-December 31,
1988 earnings and Employer 401(k) contributions for those Members who have
not attained age 59-1/2), if such value is less than $1,000, or (iii) the
amount approved as a hardship withdrawal by the Board.
(I) Notwithstanding any other provision of the Plan, no Member may defer to
his 401(k) Account during any Plan Year an amount in excess of $7,000
multiplied by the adjustment factor as provided by the Secretary of the
Treasury. The adjustment factor shall mean the cost of living adjustment
factor prescribed by the Secretary of the Treasury under Section 402(g)(5)
of the Code for years beginning after December 31, 1987, as applied to
such items and in such manner as the Secretary shall provide. In the event
that the aggregate amount of 401(k) deferrals for a Member exceeds the
limitation in the previous sentence, the amount of such excess, increased
by any income and decreased by any losses attributable thereto, shall be
refunded to such Member no later than the April 15 of the Plan Year
following the Plan Year for which the 401(k) deferrals were made.
Effective for Plan Years beginning after December 31, 2001, for purposes
of Article III, Section 4 of the Plan, no Member shall be permitted to
have elective deferrals made under this Plan, or any other qualified plan
maintained by the Employer during the taxable year, in excess of the
dollar limitation contained in Section 402(g) of the Code in effect for
such taxable year, except to the extent permitted under,
-20-
Section 9 of this Article and Section 414(v) of the Code, if applicable.
(J) SAFE HARBOR CODA
If the Employer has elected the Safe Harbor CODA option, the provisions of
this paragraph J shall apply for the Plan Year and any provisions relating
to the actual deferral percentage test described in Section 401(k)(3) of
the Code or the actual contribution percentage test described in Section
401(m)(2) of the Code do not apply. To the extent that any other
provision of the Plan is inconsistent with the provisions of this
paragraph, the provisions of the paragraph govern.
(i) Actual Deferral Percentage Test Safe Harbor
(1) Unless the Employer elects to make enhanced matching
contributions (in accordance with applicable IRS guidance) or
safe harbor nonelective contributions, the Employer will
contribute monthly or on another periodic basis for the Plan
Year a safe harbor matching contribution to the Plan on behalf
of each eligible Employee equal to (i) 100 percent of the
amount of the Employee's 401(k) deferrals that do not exceed
3 percent of the Employee's Salary for the Plan Year, plus
(ii) 50 percent of the amount of the Employee's 401(k)
deferrals that exceed 3 percent of the Employee's Salary but
that do not exceed 5 percent of the Employee's Salary ("Basic
Matching Contributions").
(2) The Member's benefit derived from the Actual Deferral
Percentage Test Safe Harbor Contributions is nonforfeitable
and may not be distributed earlier than separation from
service, death, disability, an event described in Section 401
(k)(10) of the Code, or the attainment of age 59-1/2. In
addition, such contributions must satisfy the Actual Deferral
Percentage Test Safe Harbor without regard to permitted
disparity under Section 401(I) of the Code.
(3) At least 30 days, but not more that 90 days, before the
beginning of the Plan Year, the Employer will provide each
eligible Employee a comprehensive notice of the Employee's
rights and obligations under the Plan, written in a manner
calculated to be understood by the average eligible Employee.
If an Employee becomes eligible after the 90th day before the
beginning of the Plan Year and does not receive the notice for
that reason, the notice must be provided no more than 90 days
before the Employee becomes eligible but not later than the
date the Employee becomes eligible.
(4) In addition to any other election periods provided under the
Plan, each eligible Employee may make or modify a deferral
election during the 30-day period immediately following
receipt of the notice described above.
SECTION 5. REMITTANCE OF CONTRIBUTIONS.
The contributions of both Members and their Employer (including an
administrative fee, as determined by the Board, to be paid by the Employer to
defray expenses attributable to its participation in the Plan) shall be recorded
by the Employer and remitted to the Board so that (i) in the case of Employer
Contributions the Board shall be in receipt thereof by the 15th day of the month
next following the month in respect of which such contributions are payable and
(ii) in the case of Member after-tax contributions and 401(k) deferrals, the
-21-
Trustee or custodian shall be in receipt thereof by the 15th business day of the
month following the month in which the Member contributions are received by the
Employer (in the case of amounts that a Member pays to an Employer) or the 15th
business day of the month following the month in which such amount would
otherwise have been payable to the Member in cash (in the case of amounts
withheld by an Employer for a Member). Such amounts shall be credited to the
Member's Account pursuant to Article V.
SECTION 6. TRANSFER OF FUNDS AND ROLLOVER CONTRIBUTIONS.
(A) Upon such terms and conditions as the Board and the IRS shall approve, and
provided that all benefits (including all optional forms of benefit) under
the prior retirement plan are protected in accordance with Section
411(d)(6) of the Code, or any successor thereto, and the IRS Regulations
thereunder, a transfer of funds may be made to the Plan from a prior
retirement plan of an employer which was qualified under Section 401(a)
of the Code so long as such funds (a) have been allocated to the
individual members of such prior plan, (b) shall be allocated to the
Accounts of the Members of the Plan to whom they were allocated under such
prior plan, and (c) shall be applied so that each Member affected thereby
would receive a benefit immediately after the transfer, if the Plan then
terminated, at least equal to the benefit he would have received upon a
termination of such prior plan immediately before such transfer. In
addition to protecting those prior retirement plan benefits as required in
the preceding sentence, the Thrift Plan Office may, in its discretion,
preserve any other prior retirement plan options which it determines to be
economically and administratively feasible and which are not required to
be protected under Section 411(d)(6) of the Code. Each Employee with
respect to whom such a transfer is made shall, upon such transfer, be
eligible for membership in the Plan.
(B) If the funds so transferred are transferred from a retirement plan subject
to Code Section 401(a)(11), then such funds shall be maintained in a
separate account and any subsequent distribution of those funds, and
earnings thereon, shall be subject to the following provisions:
(1) The benefit to which a married Member is entitled shall, except as
otherwise provided in this Paragraph (B), be payable by purchase
from an insurance company of a single premium contract providing for
a Qualified Joint and Survivor Annuity. The term, "Qualified Joint
and Survivor Annuity," means a benefit providing an annuity
commencing immediately for the life of the Member, ending with the
payment due on the last day of the month coincident with or
preceding the date of his death, and, if the Member dies leaving a
Surviving Spouse, a survivor annuity for the life of such Surviving
Spouse equal to one-half of the annuity payable for the life of the
Member under his Qualified Joint and Survivor Annuity, commencing on
the last day of the month following the date of the Member's death
and ending with the payment due on the first day of the month
coincident with or preceding the date of such Surviving Spouse's
death.
(2) In lieu of the form of benefit described immediately above, any
benefit payable pursuant to this Paragraph (B) may be paid in one
cash payment thereof, subject to the provisions of Subparagraph (5)
below.
(3) If a Member dies prior to the date payment of his benefit commences
(i)
-22-
without leaving a Surviving Spouse, or (ii) leaving a Surviving
Spouse and having made a valid election to waive the Preretirement
Survivor Annuity in accordance with Subparagraph (5) below, then the
remaining value of the Member's account subject to this Paragraph
(B) shall become payable to his Beneficiary in a lump sum subject to
Article III, Section 8(E)(2) and Article VII, Section 3(B).
(4) A Preretirement Survivor Annuity shall be paid to the Surviving
Spouse of a Member or former Member who dies before the commencement
of payment of any benefit from an account subject to this Paragraph
(B). The term "Preretirement Survivor Annuity" means a benefit
providing for payment of 50% of the Member's account balance as of
the Valuation Date coincident with or preceding the date of his
death, by the purchase of a single premium contract issued by an
insurance company providing a survivor annuity to his Surviving
Spouse, for the life of such Surviving Spouse. Payment of a
Preretirement Survivor Annuity shall commence in the month following
the month in which the Member dies or as soon as practicable
thereafter; provided, however, that to the extent required by law,
if the value of the amount used to purchase a Preretirement Survivor
Annuity exceeds $3,500, then payment of the Preretirement Survivor
Annuity shall not commence prior to the date the Member reached (or
would have reached, had he lived) Normal Retirement Age without the
written consent of the Member's Surviving Spouse. Absence of any
required consent will result in a deferral of payment of the
Preretirement Survivor Annuity to the month following the month in
which occurs the earlier of (i) the date the required consent is
received by the Board or (ii) the date the Member would have reached
Normal Retirement Age had he lived.
(5) (i) In the case of the Qualified Joint and Survivor Annuity, the
Fund shall no less than 30 days and no more than 90 days prior
to the annuity starting date provide each Member a written
explanation of: (i) the terms and conditions of the Qualified
Joint and Survivor Annuity; (ii) the Member'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
Member'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. In the case of the Preretirement
Survivor Annuity, the Fund shall provide each Member within
the applicable period for such Member a written explanation of
the Preretirement Survivor Annuity in such terms and in such
manner as would be comparable to the explanation provided for
meeting the requirements applicable to the Qualified Joint and
Survivor Annuity.
The applicable period for a Member is whichever of the
following periods ends last: (i) the period beginning with the
first day of the Plan Year in which the Member attains age 32
and ending with the close of the Plan Year preceding the Plan
Year in which the Member attains age 35; (ii) a reasonable
period ending after the individual becomes a Member; or (iii)
a reasonable period ending after this subparagraph (i) first
applies to the Member. Notwithstanding the foregoing, notice
must be provided within a reasonable period ending after
separation from service in the case of a Member who separated
from service before attaining age 35.
For purposes of applying the preceding paragraph, a reasonable
period
-23-
ending after the enumerated events described in (ii) and (iii)
is the end of the two-year period beginning one year prior to
the date the applicable event occurs, and ending one year
after that date. In the case of a Member who separates from
service before the Plan Year in which age 35 is attained,
notice shall be provided within the two-year period beginning
one year prior to separation and ending one year after
separation. If such a Member thereafter returns to employment
with an Employer, the applicable period for such Member shall
be redetermined.
(ii) A Member may, with the written consent of his Spouse (unless
the Board makes a written determination in accordance with the
Code and the Regulations that no such consent is required),
elect in writing (i) to receive his benefit in a single lump
sum payment within the 90-day period ending on his annuity
starting date (which is the first day of the first period for
which an amount is paid as an annuity or any other form); and
(ii) to waive the Preretirement Survivor Annuity within the
period beginning on the first day of the Plan Year in which
the Member attains age 35 and ending on the date of his death.
Any election made pursuant to this Subparagraph (5) may be
revoked by a Member, without spousal consent at any time
within which such election could have been made. Such an
election or revocation must be made in accordance with
procedures developed by the Board and shall be notarized.
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 Member 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. No consent obtained under this provision
shall be valid unless the Member has received the notice
described in subparagraph (i) above.
Notwithstanding anything to the contrary, effective for Plan
Years beginning after December 31, 1996, the 90-day period in
which a Member may, with the written consent of his Spouse,
elect in writing to receive his benefit in a single lump sum
shall not end before the 30th day after the date on which
explanations of the Qualified Joint and Survivor Annuity and
Preretirement Survivor Annuity are provided. A Member may
elect (with any applicable spousal consent) to waive any
requirement that the written explanation be provided at least
30 days before the annuity starting date (or to waive the
30-day requirement under the preceding sentence) if the
distribution commences more than seven days after such
explanation is provided.
(6) Notwithstanding the preceding provisions of this Paragraph (B), any
benefit of $3,500, subject to the limits of Article X, Section 4, or
less shall be paid in a lump cash sum in full settlement of the
Plan's liability therefor; provided, however, that in the case of a
married Member, no such lump sum payment shall be made after
benefits have commenced without the consent of the Member and his
Spouse or, if the Member has died, the Member's Surviving Spouse.
Furthermore, if the value of the benefit payable to a Member or his
Surviving Spouse is greater than $3,500 and the Member has or had
not
-24-
reached his Normal Retirement Age, then to the extent required by
law, unless the Member (and, if the Member is married and his
benefit is to be paid in a form other than a Qualified Joint and
Survivor Annuity, his Spouse, or, if the Member was married, his
Surviving Spouse) consents in writing to an immediate distribution
of such benefit, his benefit shall continue to be held in the Trust
until a date following the earlier of (i) the date of the Board's
receipt of all required consents or (ii) the date the Member reaches
his earliest possible Normal Retirement Age under the Plan (or would
have reached such date had he lived), and thereafter shall be paid
in accordance with this Paragraph (B).
(C) Upon such terms and conditions as the Board shall approve, all Members
(regardless of whether their Accounts are active) shall be permitted to
make rollover contributions to the Plan of amounts held on their behalf
in:
1) a qualified plan described in Section 401(a) or 403(a) of the
Code, (including after-tax contributions for direct rollovers);
2) an annuity contract described in Section 403(b) of the Code,
(excluding after-tax contributions);
3) an eligible plan under Section 457(b) of the Code which is
maintained by a state, political subdivision of a state, or an
agency or instrumentality of a state or political subdivision of a
state; and
4) an individual retirement account or annuity described in Section
408(a) or 408(b) of the Code that is eligible to be rolled over and
would otherwise be includible in gross income.
An Employer may, at its option, permit its Employees to make
rollover contributions prior to the date as of which the Employees
become eligible for membership in the Plan. All such amounts which
are accepted by the Thrift Plan Office shall be certified in form
and substance satisfactory to the Thrift Plan Office by the Member
as consisting of all or a portion of an "eligible rollover
distribution" or a "rollover contribution" within the meaning of
Section 402(c)(4) or Section 408(d)(3), respectively, of the Code. A
Member shall have a nonforfeitable vested interest in all such
amounts credited to his Rollover Account.
(7) Upon such terms and conditions as the Board and the IRS shall
approve, a Member shall be permitted to transfer amounts deferred
and/or contributed on behalf of such Member to a nonqualified
deferred compensation plan maintained by his Employer to the Plan.
Such transfer to the Plan from the Employer's nonqualified deferred
compensation Plan shall be made by the 15th day of the third month
immediately following the Plan Year for which such compensation was
deferred by the Member. The transferred amounts shall be treated as
contributions under Article III for such Plan Year and shall be
categorized as 401(k) deferrals under Article III, Section 4 or as
employer matching contributions under Article III, Section 2, as
applicable.
SECTION 7. LIMITATIONS ON MEMBER CONTRIBUTIONS AND MATCHING EMPLOYER
CONTRIBUTIONS.
-25-
(A) Notwithstanding any other provision of this Section 7, effective for
Plan Years beginning after December 31, 1996, the actual
contribution percentage for a Plan Year for Highly Compensated
Employees shall, in accordance with the Code and IRS Regulations,
satisfy either (i) or (ii) as follows:
(i) Prior Year Testing:
(a) the actual contribution percentage for a Plan Year for Members
who are Highly Compensated Employees for the Plan Year shall not
exceed the greater of: (i) the prior Plan Year's actual contribution
percentage for Members who were Non-highly Compensated Employees for
the prior Plan Year multiplied by 1.25; or (ii) the prior Plan
Year's actual contribution percentage for Members who were
Non-highly Compensated Employees for the prior Plan Year multiplied
by 2, provided, for purposes of this clause (ii), that the actual
contribution percentage for Members who are Highly Compensated
Employees does not exceed the "actual contribution percentage" for
Members who were Non-highly Compensated Employees in the prior Plan
Year by more than 2 percentage points.
For the first Plan Year of an Employer this Plan permits any Member
to make contributions under Article III, Section 1 (after-tax),
provides for Employer matching contributions or both, and if this
Plan is not a successor plan, for purposes of the foregoing tests,
the prior Plan Year's Non-highly Compensated Employees' actual
contribution percentage shall be 3 percent unless the Employer has
elected to use the current Plan Year's actual contribution
percentage for these Members.
(ii) Current Year Testing:
If elected by the Employer, the actual contribution percentage tests
in (a) and (b) , above, will be applied by comparing the current
Plan Year's actual contribution percentage for Members who are
Highly Compensated Employees for such Plan Year with the current
Plan Year's actual contribution percentage for Members who are
Non-highly Compensated Employees for such year. Once made, this
election can only be changed and the Prior Year Testing method
applied if the Plan meets the requirements for changing to Prior
Year Testing set forth in IRS Notice 98-1 (or superseding guidance).
For purposes of this Section 7, the "actual contribution percentage" for a
Plan Year means, for a specified group of Employees, the average of the
ratios (calculated separately for each Employee in such group) of (a) the
sum of (i) Employer matching contributions credited to his Regular Account
as described in Section 2 and Section 3, Formula (1) of this Article for
the Plan Year, (ii) Member contributions credited to his Regular Account
for the Plan Year, and (iii) in accordance with and to the extent
permitted by the IRS Regulations, 401(k) deferrals credited to his 401(k)
Account, to (b) the amount of the Member's compensation (as defined in
Section 414(s) of the Code) which, at the Employer's election, shall
include the compensation required to be reported under Section 6041 or
6051 of the Code (i.e., "W-2 compensation") for the Plan Year or,
alternatively, where specifically elected by the Employer, for only that
part of the Plan Year during which the Member was eligible to participate
in the Plan. The 401(k)
-26-
deferrals referred to in (iii) above in this Paragraph (A) may be taken
into account in determining the actual contribution percentage for a Plan
Year if the actual deferral percentage test is satisfied prior to and
following the exclusion of the 401(k) deferrals that are used to satisfy
the actual contribution percentage test. An Employee's actual contribution
percentage shall be zero if no such contributions are made by him or on
his behalf for such Plan Year. The actual contribution percentage taken
into account under this Paragraph (A) for any Highly Compensated Employee
who is eligible to make Member contributions or receive Employer matching
contributions under two or more plans described in Section 401(a) of the
Code or arrangements described in Section 401(k) of the Code that are
maintained by the Employer shall be determined as if all such
contributions were made under a single plan.
(B) The Thrift Plan Office shall determine as of the end of the Plan Year
whether one of the actual contribution percentage tests specified in
Paragraph (A) above is satisfied for such Plan Year. This determination
shall be made after first determining the treatment of excess deferrals
within the meaning of Section 402(g) of the Code under Article III,
Section 4(l) and then determining the treatment of excess contributions
under Article III, Section 4(E). In the event that neither of the actual
contribution percentage tests is satisfied, the Thrift Plan Office shall
(i) refund the excess aggregate contributions to the extent attributable
to Member after-tax contributions and vested matching contributions for
which the underlying Member after-tax contributions or 401(k) deferrals
are not subject to correction under the actual deferral percentage or
actual contribution percentage tests for such year (and, any income
related thereto) and (ii) forfeit the excess aggregate contributions to
the extent attributable to non-vested Employer matching contributions and
vested Employer matching contribution for which the underlying Member
after-tax contributions or 401(k) deferrals are subject to correction
under the actual deferral percentage or actual contribution percentage
tests for such year (and any income related thereto) in the manner
described in Paragraph (C) below. For purposes of this Section 7, "excess
aggregate contributions" means, with respect to any Plan Year and with
respect to any Member, the excess of the aggregate amount of contributions
(and any earnings and losses allocable thereto) made as (a) Employer
matching contributions to their Regular Accounts, (b) Member contributions
to their Regular Accounts and (c) 401(k) deferrals by Members to their
401(k) Accounts (to the extent permitted by the IRS Regulations and if
the Thrift Plan Office elects to take into account such 401(k)
contributions when calculating the actual contribution percentage) of
Highly Compensated Members for such Plan Year, over the maximum amount of
such contributions that could be made as Employer matching contributions
to Regular Accounts, Member contributions to Regular Accounts and 401(k)
deferrals by Members to 401(k) Accounts of such Members without violating
the requirements of Paragraph (A) above.
(C) To the extent excess aggregate contributions must be refunded or forfeited
for a Plan Year, and in accordance with applicable law (including IRS
Notice 97-2 or any successor guidance) such excess amounts will be
refunded (or, as applicable, forfeited) first to the Highly Compensated
Employees with the largest Contribution Percentage Amounts (as defined
below) taken into account in calculating the actual contribution
percentage test for the year the excess arose and continuing in descending
order until all the excess aggregate contributions are refunded (or, as
applicable, forfeited). For purposes of the preceding sentence, the
"largest amount" is determined after distribution of any excess aggregate
contributions. For
-27-
purposes of this paragraph, "Contribution Percentage Amounts" means the
sum of Member after-tax contributions, Employer matching contributions,
and Employer supplemental contributions under Formula (1) made under the
Plan on behalf of the Member for the Plan Year. However, such Contribution
Percentage Amounts shall not include Employer matching contributions that
are forfeited either to correct excess aggregate contributions or because
the contributions to which they relate are excess deferrals, excess
contributions or excess aggregate contributions. The refund or forfeitures
of such excess aggregate contributions shall be made with respect to such
Highly Compensated Members to the extent practicable before the 15th day
of the third month immediately following the Plan Year for which such
excess aggregate contributions were made, but in no event later than the
end of the Plan Year following such Plan Year or, in the case of the
termination of the Plan in accordance with Article XII or termination of
Employer participation in the Plan in accordance with Article XI, no later
than the end of the twelve-month period immediately following the date of
such termination.
(D) Should an Employer's matching contributions (when combined with any
applicable Member after-tax contributions) fail to satisfy the applicable
nondiscrimination requirements under the Code, the Employer shall be
permitted to make additional matching contributions to the Regular Account
of Non-highly Compensated Employees (to be determined at the Employer's
discretion) and shall be contributed by the Employer by March 15th
following the Plan Year with respect to which the applicable
non-discrimination tests were not satisfied. Such matching contributions
shall be added to the matching contributions for the immediately preceding
Plan Year and shall be subject to this Section 7.
SECTION 8. PROFIT SHARING FEATURE.
(A) An Employer may, at its option, adopt a Profit Sharing Feature as
described herein, subject to any other provisions of the Plan, where
applicable. This Feature may be adopted either in lieu of, or in addition
to, any other Plan Feature contained in this Article III, including the
contributions described in Sections 1 through 4 of this Article. The
Profit Sharing Feature is designed to provide the Employer a means by
which to provide discretionary contributions on behalf of Employees
eligible under the Plan.
Where investments provided for the contributions permitted under Article
III, Sections 1 through 4 were subject to the Members' investment
directions among the Investment Funds and the Profit Sharing Feature
elected by the Employer requires that all account balances be invested in
the Stable Value Fund or the Government Money Market Fund, the accounts
provided under Article III, Sections 1 through 4 will continue to be
subject to the Members' directions, pursuant to the provisions of Article
IV.
(B) (1) Subject to the provisions of Article X, Section 1, an Employer may,
but shall not be required to, contribute on behalf of each of its
Members, on an annual (or at the election of the Employer,
quarterly) basis for any Plan Year or fiscal year of the Employer
(as the Employer shall elect), a discretionary amount not to exceed
the maximum amount allowable as a deduction to the Employer under
the provisions of Section 404 of the Code. Such Profit Sharing
contribution must be received by the Thrift Plan Office within the
time prescribed by law, including extensions of time, for filing of
the Employer's
-28-
federal income tax return following the close of the Contribution
Determination Period on behalf of all those Members who were in its
employ on the last working day of such Contribution Determination
Period. For purposes of making the allocations described in this
Subparagraph (B)(1), a Member who is on a Type 1 non-military Leave
of Absence (as defined in Article I, Paragraph (22) and Article X,
Section 8(B)(1)) or a Type 4 military Leave of Absence (as defined
in Article I, Paragraph (22) and Article X, Section 8(B)(4)), shall,
notwithstanding the provisions of this Paragraph, be treated as if
he were a Member who was an Employee in employment with his Employer
on the last day of such Contribution Determination Period.
(2) A Profit Sharing Account shall be established and maintained on
behalf of each Member whose Employer has adopted the Profit Sharing
Feature showing each Member's interests in the Investment Funds or
other investment vehicles attributable solely to such Profit Sharing
contributions. The interest in each Investment Fund shall be
represented by Units. These Units will be valued in accordance with
Article V. Such account shall be known as the "Profit Sharing
Account," as defined under Article I, Paragraph (27) and shall be an
account segregated from all other accounts maintained under the Plan
with respect to such Member.
(C) (1) Contributions shall be allocated to each Member's Profit Sharing
Account for the Contribution Determination Period at the election of
the Employer, in accordance with one of the options selected below:
(i) in the same ratio as each Member's Salary during such
Contribution Determination Period bears to the total of such Salary
of all Members, (ii) in the same ratio as each Member's Salary for
the portion of the Contribution Determination Period during which
the Member satisfied the Employer's eligibility requirement(s) bears
to the total of such Salary of all Members or (iii) an Employer may
integrate the Profit Sharing Feature with Social Security in
accordance with the following provision. The annual (or quarterly,
if applicable) contribution for any Contribution Determination
Period (which period shall include, for the purposes of the
following maximum integration levels provided under Subparagraphs
(C)(1) and (2) for those Employers who have elected quarterly
allocations of contributions, the four quarters of a Plan Year or
fiscal year) shall be allocated to each Member who is employed by
the Employer on the last day of such Contribution Determination
Period in a uniform percentage (i) of each Member's Salary during
the Contribution Determination Period (the "Base Contribution
Percentage"), plus a uniform percentage of each Member's Salary for
the Contribution Determination Period in excess of the Social
Security Taxable Wage Base for such Contribution Determination
Period (the "Excess Contribution Percentage"), or (ii) of each
Member's Salary for the portion of the Contribution Determination
Period during which the Member satisfied the Employer's eligibility
requirement(s), if any, up to the Base Contribution Percentage for
such Contribution Determination Period, plus a uniform percentage of
each Member's Salary, for the portion of the Contribution
Determination Period during which the Member satisfied the
Employer's eligibility requirement(s), in excess of the Social
Security Taxable Wage Base for such Contribution Determination
Period, equal to the Excess Contribution Percentage.
(2) The Excess Contribution Percentage described in Subparagraph (1)
above may
-29-
not exceed the lesser of (i) the Base Contribution Percentage, or
(ii) the greater of (1) 5.7% or (2) the percentage equal to the
portion of the Code Section 3111(a) tax imposed on employers under
the Federal Insurance Contributions Act (as in effect as of the
beginning of the Plan Year) which is attributable to old-age
insurance. For purposes of this Subparagraph (2), "compensation" as
defined in Section 414(s) of the Code shall be substituted for
"Salary" in determining the Excess Contribution Percentage and the
Base Contribution Percentage.
(3) The Employer may not adopt the Social Security integration options
provided above if any other integrated defined contribution or
defined benefit plan is maintained by the Employer during any
Contribution Determination Period.
(4) No contributions by Members shall be made under the Profit Sharing
Feature provided under this Section 8 of Article III.
(D) (1) Contributions under the Profit Sharing Feature shall be invested in
accordance with the provisions and procedures of Article IV, except
as otherwise provided in this Paragraph (D). At the Employer's
election, contributions on behalf of Members may be invested (i)
entirely in the Stable Value Fund or the Government Money Market
Fund, or (ii) pursuant to the Member's directions among the
Investment Funds and other investment vehicles. If the Employer does
not so elect, or until an effective direction is made by Members,
all contributions made pursuant to this Article III, Section 8,
shall be invested in the Government Money Market Fund.
(2) A Member's investment directions, if any, with respect to
contributions made under the Profit Sharing Feature, shall be
submitted in accordance with the procedures prescribed by the Board
and shall be separate from the directions submitted with respect to
all other contributions under the Plan.
(3) Where an Employer previously elected to invest contributions
pursuant to Article IV and subsequently elects to have all future
contributions invested entirely in the Stable Value Fund or the
Government Money Market Fund in accordance with Subparagraph (D)(1)
above, Units previously accumulated in the Investment Funds or other
investment vehicles prior to such election will continue to be
subject to the Members' investment directions in accordance with
Article IV. All future Employer contribution allocations made
following the Employer's election shall be allocated to the Stable
Value Fund or the Government Money Market Fund, as applicable.
(E) (1) Except as otherwise provided under Article VII, Section 2, no
amounts may be withdrawn from a Member's Profit Sharing Account
while still employed by the Employer, other than (i) amounts
required to be distributed pursuant to the terms of a Qualified
Domestic Relations Order, as defined in Article X, Section 6 of the
Plan; or (ii) amounts withdrawn on account of mistake of fact,
within one year after the payment of the contribution, as reviewed
and approved by the Thrift Plan Office.
(2) Subject to the provisions of Article VII of the Plan, upon receipt
by the Plan of a notice of termination of Employment, a Member may
request to withdraw any or all vested amounts in his Profit Sharing
Account, including any amounts held
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in a Rollover Account for such Member, following the filing of a
notice of withdrawal with the Thrift Plan Office.
SECTION 9. CATCH-UP CONTRIBUTIONS
Effective January 1, 2002, all Employees who are eligible to make elective
deferrals under this Plan and who have attained age 50 before the close of
the Plan Year shall be eligible to make catch-up contributions in
accordance with, and subject to the limitations of, Section 414(v) of the
Code and applicable IRS guidance thereunder. Such catch-up contributions
shall not be taken into account for purposes of the provisions of the Plan
implementing the required limitations of Sections 402(g) and 415 of the
Code. The Plan shall not be treated as failing to satisfy the provisions
of the Plan implementing the requirements of Section 401(k)(3),
401(k)(11), 401(k)(12), 410(b), or 416 of the Code, as applicable, by
reason of the making of such catch-up contributions.
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ARTICLE IV INVESTMENT OF CONTRIBUTIONS
All contributions to the Plan shall, upon receipt by the Board, be delivered to
the Trustee to be held in the Trust Fund and invested and distributed by the
Trustee in accordance with the provisions of the Plan and Trust Agreement. The
Trust Fund shall consist of certain investment funds (each an "Investment Fund")
or other investment vehicles as described in the Trust Agreements and as
designated by the Board.
To the extent made available under the Plan, an Employer may elect to allow
Members to direct the investment of their Accounts, pursuant to, and in
accordance with, such rules and procedures as may be prescribed by the Board, to
a self-directed brokerage account. Should a self-directed brokerage account be
made available under the Plan, the Board may elect to provide, to all Members
who have terminated employment with their Employer, the option to direct the
investment of their Account to a self-directed brokerage account. Where an
Employer or the Board elects to provide a self-directed brokerage account under
the Plan, the Trustee may invest amounts held by it in a self-directed brokerage
account maintained by Charles Schwab & Co., Inc. (or any other such entity which
provides a self-directed brokerage account) on behalf of Plan Members who elect
to utilize such investment vehicle.
A Trustee may in its discretion invest any amounts held by it in any Investment
Fund in any commingled or group trust fund described in Section 401(a) of the
Code and exempt from taxation under Section 501(a) of the Code or in any common
trust fund exempt under Section 584 of the Code, provided that such trust fund
satisfies the requirements of this Plan applicable to such investment fund and
that the Trustees serve as Trustee of such commingled, group or common trust
fund. To the extent that the Investment Funds are at any time invested in any
commingled, group or common trust fund, the declaration of trust or other
instrument pertaining to such fund and any amendments thereto are hereby adopted
as part of this Agreement and deemed to form a part of the Plan.
Except as provided in Article III, Section 8(D)(1), each Member shall direct in
writing that his contributions (including 401(k) deferrals and rollover
contributions, if any) and the contributions made by his Employer (including
Profit Sharing contributions) on his behalf shall be invested (a) entirely in
any single Investment Fund or other investment vehicle (subject to additional
restrictions imposed by the Board), or (b) in any combination of Investment
Funds or investment vehicles offered under the Plan, in multiples of 1%
(subject to additional restrictions imposed by the Board). To the extent that an
effective direction is not made by the Member, such contributions shall be
invested in the Government Money Market Fund.
Any such investment direction shall be followed until changed. Subject to the
provisions of the following paragraphs of this Section, one time each business
day (or, as elected by the Employer, once per month, or once per quarter) a
Member may change his investment direction as to future contributions and as to
the investment of his accumulated amounts in the Investment Funds or other
investment vehicles. Such investment direction changes will become effective
upon the Valuation Date coinciding with or next following the date which his
notice was received and processed by the Thrift Plan Office subject to the same
conditions with respect to the amount to be transferred under this Section which
are specified in the Plan procedures for determining the amount of payments made
under Article VII, Section 1(A) of the Plan.
Except as otherwise provided below, a Member may not direct a transfer of his
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accumulated units in the Stable Value Fund to the Government Money Market Fund.
A Member may direct a transfer from any other Investment Fund to the Government
Money Market Fund provided that amounts previously transferred from the Stable
Value Fund to such Investment Fund remain in such funds for a period of three
months prior to being transferred to the Government Money Market Fund.
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ARTICLE V MEMBERS' ACCOUNTS, UNITS AND VALUATION
An Account shall be established and maintained for each Member showing his
interests in the Investment Funds or other investment vehicles. The interest in
each Investment Fund shall be represented by Units.
As of each Valuation Date, the value of a Unit in each Investment Fund shall be
determined by dividing (a) the sum of the net assets at market value determined
by the Trustee by (b) the total number of outstanding Units.
The number of additional Units to be credited to a Member's interest in each
Investment Fund, as of any Valuation Date, shall be determined by dividing (a)
that portion of the aggregate contributions by and on behalf of the Member which
was directed to be invested in such Investment Fund and received by the Board by
(b) the Unit value of such Investment Fund.
The value of a Member's Account may be determined as of any Valuation Date by
multiplying the number of Units to his credit in each Investment Fund by the
value of the Investment Fund Unit on such date and aggregating the results. If,
and to the extent, a Member's Account is invested pursuant to a self-directed
brokerage account, the investments held in that account shall be valued by the
brokerage firm maintaining such account in accordance with such procedures as
may be determined by such brokerage firm.
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ARTICLE VI VESTING OF UNITS
SECTION 1. VESTING.
(A) All amounts credited to a Member's Account shall immediately and fully
vest in him, except amounts with respect to which the Employer has elected
to adopt a vesting schedule as provided in this Article.
(B) An Employer may adopt a different vesting schedule for its Members' (i)
Profit Sharing Accounts, (ii) Matching Amounts (including amounts
contributed by the Employer under Article III, Section 3, Formula 1) and
(iii) Basic Amounts and Supplemental Amounts (under Article III, Section
3, Formula 2).
(C) In accordance with Subsection (A) above, one or more of the following
schedules may be elected by the Employer:
SCHEDULE 1: Applicable Employer Contributions (and related earnings) shall
immediately and fully vest. If the eligibility requirement(s) selected by
the Employer under Article II, Section 2(B), require(s) that an Employee
complete a period of Employment which is longer than 12 consecutive
months, this vesting Schedule 1 shall be automatically applicable.
SCHEDULE 2: Applicable Employer Contributions (and related earnings) shall
become nonforfeitable and vested in accordance with the schedule set forth
below:
Completed Vested
Years of Employment Percentage
- ------------------- ----------
Less than 2 0%
2 but less than 3 20%
3 but less than 4 40%
4 but less than 5 60%
5 but less than 6 80%
6 or more 100%
SCHEDULE 3: Applicable Employer Contributions (and related earnings) shall
become nonforfeitable and vested in accordance with the schedule set forth
below:
Completed Vested
Years of Employment Percentage
- ------------------- ----------
Less than 5 0%
5 or more 100%
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SCHEDULE 4: Applicable Employer Contributions (and related earnings) shall
become nonforfeitable and vested in accordance with the schedule set forth
below:
Completed Vested
Years of Employment Percentage
- ------------------- ----------
Less than 3 0%
3 or more 100%
SCHEDULE 5: Applicable Employer Contributions (and related earnings) shall
become nonforfeitable and vested in accordance with the schedule set forth
below:
Completed Vested
Years of Employment Percentage
- ------------------- ----------
Less than 1 0%
1 but less than 2 25%
2 but less than 3 50%
3 but less than 4 75%
4 or more 100%
SCHEDULE 6: Applicable Employer Contributions (and related earnings) shall
become nonforfeitable and vested in accordance with the schedule
determined by the Employer in accordance with applicable law.
Notwithstanding the vesting schedules above, a Member's interest in his
Account shall become 100% vested in the event that (i) the Member dies
while in service with the Employer and the Plan has received notification
of death, (ii) the Member has been approved for Disability, pursuant to
the provisions of Article VII, Section 4, and the Plan has received
notification of Disability, or (iii) the Member has attained Normal
Retirement Age while in service with the Employer.
(D) VESTING ELECTION
(1) Except as otherwise provided in the next following paragraph, in the
event that the Employer adopts the Plan as a successor plan to
another defined contribution plan qualified under Section 401(a)
and 501(a) of the Code, or in the event that the Employer changes
or amends a vesting schedule adopted under this Article, any Member
who was covered under such predecessor plan or, the pre-amendment
vesting schedule under the Plan, and who has completed at least 3
Years of Employment with such Employer, may elect to have the
nonforfeitable percentage of the portion of his Account which is
subject to such vesting schedule computed under such predecessor
plan's vesting provisions, or computed without regard to such change
or amendment under the Plan (a "Vesting Election"). Any Vesting
Election shall be made by notifying the Thrift Plan Office in
writing within the election period hereinafter described. The
election period shall begin on the date such amendment is adopted or
the date such change is effective, or the date the Plan which serves
as a successor plan is adopted or effective, as the case may be, and
shall end no earlier than the latest of the
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following dates: (i) the date which is 60 days after the day such
amendment is adopted; (ii) the date which is 60 days after the day
such amendment or change becomes effective; (iii) the date which is
60 days after the day the Member is given written notice of such
amendment or change by the Thrift Plan Office; (iv) the date which
is 60 days after the day the Plan is adopted by the Employer or
becomes effective; or (v) the date which is 60 days after the day
the Member is give written notice that the Plan has been designated
as a successor plan. Any such election once made shall be
irrevocable.
(2) To the extent permitted under the Code and Regulations, an Employer
described in the foregoing paragraph may elect to treat all of its
Members who are eligible to make a Vesting Election as having made
such Vesting Election if the Vesting Schedule that would result from
such an election is more favorable than the Vesting Schedule that
would apply pursuant to the Plan amendment. Furthermore, subject to
the requirements of the applicable Regulations, the Employer may
elect to treat all its Members, who were employed by the Employer on
or before the effective date of the change or amendment, as subject
to the prior vesting schedule, provided such prior schedule is more
favorable.
(E) An Employer may, at its option, fully vest any Employer contributions (as
elected by the Employer) and related earnings allocated to Members'
Accounts whose employment terminated pursuant to a sale of a line of
business, a subsidiary, or a division, except that the Employer's election
shall be ineffective if it is determined that such election is
discriminatory.
(F) Effective January 1, 2002, a Member's accrued benefit derived from
Employer matching contributions shall vest as provided by the Employer,
except that the vesting schedule elected by the Employer for Employer
matching contributions (and related earnings) credited to the Member's
Account on or after January 1, 2002 must be nonforfeitable and vested in
accordance with the minimum vesting schedules under Section 411(a)(12) of
the Code. If the Employer has elected a vesting schedule for Employer
matching contributions which does not satisfy Section 411(a)(12) of the
Code as of January 1, 2002, the Member's vested interest in his Account
attributable to Employer matching contributions made on or after January
1, 2002, shall not be less than the percentage determined in accordance
with the following schedule:
Completed Vested
Years of Employment Percentage
- ------------------- ----------
Less than 2 0%
2 but less than 3 20%
3 but less than 4 40%
4 but less than 5 60%
5 but less than 6 80%
6 or more 100%
Notwithstanding the schedule provided above, if, as of December 31, 2001,
an Employer has elected a five (5) year cliff vesting schedule, under
Schedule 3 above, for Employer matching contributions, the vested interest
of each Member for
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Employer matching contributions (and related earnings) credited to the
Member's Account on or after January 1, 2002, shall not be less than the
percentage determined in accordance with the following schedule:
Completed Vested
Years of Employment Percentage
- ------------------- ----------
Less than 3 0%
3 or more 100%
Notwithstanding anything in this Section F to the contrary, an Employer
may elect to apply the applicable vesting schedule under Section
411(a)(12) of the Code with respect to the Member's vested interest in his
Account attributable to Employer matching contributions for Plan Years
beginning before January 1, 2002.
SECTION 2. FORFEITURES.
(A) If a Member who was partially vested in his Account on the date of his
termination of Employment returns to Employment, his years of Employment
prior to the Break in Service shall be included in determining vesting
with respect to any post-break-in service benefit accruals and, if he
returns before incurring 5 consecutive one-year Breaks in Service, any
amounts forfeited from his Account shall be restored to his Account;
provided, however, that if such a Member has received a distribution
pursuant to Article VII, Section 3 or Article III, Section 8, his
non-vested account Units shall not be restored unless he repays to the
Plan the full amount distributed to him before the earlier of (i) 5 years
after the first date on which the Member is subsequently reemployed by the
Employer, or (ii) the close of the first period of 5 consecutive one-year
Breaks in Service commencing after the withdrawal. The amounts restored to
the Member's Account will be valued on the Valuation Date coincident with
or next following the later of (i) the date the Employee is rehired, or
(ii) the date a new enrollment application is received by the Thrift Plan
Office and (iii) the date the Employee repays the full amount previously
distributed to him that resulted in the forfeiture. If a Member terminates
Employment without any vested interest in his Account, he shall (i)
immediately be deemed to have received a total distribution of his Account
and (ii) thereupon forfeit his entire Account; provided that if such
Member returns to Employment before the number of consecutive one-year
Breaks in Service equals or exceeds the greater of (i) 5, or (ii) the
aggregate number of the Member's Years of Service prior to such Break in
Service, his Account shall be restored in the same manner as if such
Member had been partially vested at the time of his termination of
Employment and had his Non-Vested Account restored upon a return to
employment, and his Years of Employment prior to incurring the first Break
in Service shall be included in any subsequent determination of his
vesting service.
(B) Forfeited amounts, as described in the preceding Paragraph A, shall be
made available to the Employer through a transfer from the Member's
Account to the Employer Hold Account, upon: (1) if the Member had a vested
interest in his Account at his termination of Employment, the earlier of
(i) the date as of which the Member receives a distribution of his entire
vested interest in his Account or (ii) the date upon which the Member
incurs 5 consecutive one-year Breaks in Service or (2) the date of the
Member's termination of Employment, if the Member then had no vested
interest in his Account. Once so transferred, such amounts shall be used
at the option of the Employer to (i) reduce administrative expenses (in
accordance with Article IX, Section 2) for that Contribution Determination
Period, (ii) offset any
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contribution to be made by such Employer for that Contribution
Determination Period, or (iii) be allocated to all eligible Members at the
end of such Contribution Determination Period in accordance with clause
(ii) of the first sentence in Article III, Section 8(C)(1). The Employer
Hold Account, referenced in this Paragraph (B), shall be maintained to
receive, in addition to the forfeitures described above, (i) contributions
in excess of the limitations contained in Section 415 of the Code, as
described in Article X, Section 1(C),(ii) amounts, if any, forfeited
pursuant to Sections 4 and 7 of Article III, and (iii) Employer
contributions made in advance of the date allocable to Members.
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ARTICLE VII WITHDRAWAL PAYMENTS
SECTION 1. GENERAL.
(A) All payments in respect of a Member's Account shall be made in cash from
the Trust Fund and in accordance with the provisions of this Article or
Articles XI or XII or Article III, Section 4. The amount of payment will
be determined in accordance with the value of the Member's Account on the
Valuation Date coinciding with or next following the date proper notice is
filed with the Board, unless following such Valuation Date a decrease in
the value of the Member's investment in any of the Investment Funds or
other Account investment occurs prior to the date the Member's Account is
paid in which case that part of the payment which is based on such
investments shall equal the value of such investments determined as of the
date of payment which date shall occur as soon as administratively
practicable on or following the Valuation Date such proper notice is filed
with the Board. If Units are redeemed to make a payment of benefits, the
redemption date Unit value with respect to a Member's investment in any
Investment Fund shall equal the value of a Unit in such Investment Fund,
as determined in accordance with the valuation method applicable to Unit
investments in such Fund on the date the Member's investment is redeemed.
Payments provided under this Section will be made in a lump sum as soon as
practicable after such Valuation Date or date of redemption, as may be
applicable, subject to any applicable restriction on redemption imposed on
amounts invested in any of the available Investment Funds.
(B) At the election of the Employer, the Employer can suspend matching
contributions to the Plan on behalf of a Member, during his uninterrupted
period of Employment with such Employer, who makes a withdrawal from his
Regular Account for a period of 6 months after such withdrawal, except
that (i) if the withdrawal does not exceed the amount of the Member's
contributions in his Regular Account plus earnings thereon, Employer
contributions on his behalf may resume 3 months after such withdrawal, and
(ii) if the withdrawal does not exceed the amount, if any, of the Member's
contributions in his Regular Account made prior to January 1, 1987 without
earnings, then Employer contributions on his behalf shall not be affected
by such withdrawal.
(C) Any partial withdrawal from a Member's Regular Account or Rollover Account
shall be in an amount of at least $ 1,000 or shall be for the full amount
of either (a) the Member's contributions made prior to January 1, 1987
without earnings or (b) the Member's contributions plus earnings thereon.
Any partial withdrawal shall be deemed to come first from the Member's
contributions made prior to January 1, 1987 without earnings referred to
in (ii) above, second proportionately from the Member contributions made
after December 31, 1986 plus earnings thereon, and finally from the
balance of his Regular Account or Rollover Account.
(D) Any amounts paid under this Article may not be returned to the Plan.
SECTION 2. ACCOUNT WITHDRAWAL WHILE EMPLOYED.
A Member may voluntarily withdraw his Account (other than his 401(k) Account,
Safe Harbor CODA Account, Profit Sharing Account, or Profit Sharing Rollover
Amounts, if any) while in Employment by filing a notice of withdrawal with the
Thrift Plan Office; provided, however, that in the event his Employer has
elected to provide an annuity
-40-
option under Article VII, Section 3(B)(2) and a Member has elected an annuity
form of payment, or to the extent that the survivor annuity requirements of
Section 401(a)(11) of the Code apply to the Account, no withdrawals may be made
from a married Member's Account without the written consent of such Member's
Spouse (which consent shall be subject to the procedures set forth in Article
III, Section 6(B)). Notwithstanding, the Employer may, at its option, provide
that a Member be allowed to withdraw all or a portion of his Profit Sharing
Account or Profit Sharing Rollover Amounts, if any, subject to the same survivor
annuity requirements described in the preceding sentence. Only one in-service
withdrawal under this Section may be made in any Plan Year from each of the
Member's Regular Account and Rollover Account. This restriction shall not,
however, apply to a withdrawal of a Member's contributions made prior to January
1, 1987 without earnings, or a withdrawal under this Section in conjunction with
a hardship withdrawal as defined under Article III, Section 4(H).
Notwithstanding the foregoing paragraph, a Member shall not withdraw any
Matching, Basic, Profit Sharing, or Supplemental contributions made by his
Employer under Article III, Section 2 or Section 3 and credited to his Regular
Account unless (i) the Member has completed 60 months of participation in the
Plan, (ii) the withdrawal occurs at least 24 months after such Matching, Basic,
Profit Sharing, or Supplemental contributions were made by the Employer, (iii)
the Member's Employer terminates its participation in the Plan or (iv) the
Member dies, is disabled, retires, terminates Employment or attains age 59 1/2.
For purposes of the preceding requirements, if the Member's Account includes
amounts which have been transferred from a defined contribution plan established
prior to the adoption of the Plan by the Member's Employer, the period of time
during which amounts were held on behalf of such Member and the periods of
participation of such Member under such defined contribution plan shall be taken
into account.
SECTION 3. ACCOUNT WITHDRAWAL UPON TERMINATION OF EMPLOYMENT OR EMPLOYER
PARTICIPATION.
(A) Except as provided in Article III, Sections 4 and 8, a Member who
terminates Employment with a participating Employer, or whose Employer
terminates its participation in the Plan under Article XI, may withdraw
his Account at any time thereafter or, if elected by his Employer in
accordance with the provisions of Article XI, Section 3, may transfer his
Account, including all outstanding loan balances, to a qualified successor
plan maintained by his Employer following the termination by the Employer
of its participation under the Plan; provided, however, that the Member
may not transfer outstanding loan balances unless such qualified successor
plan provides participant loans. For purposes of this Section 3, a
qualified successor plan is an employee benefit plan established or
maintained by the Employer which (i) has received a favorable
determination letter from the IRS stating that such plan satisfies the
then current qualification and tax-exemption requirements of the Code or
with respect to which an opinion of counsel to the same effect, and in
such form as may be satisfactory to the Thrift Plan Office, (ii) has
provided the Thrift Plan Office with written certification by its
appropriate fiduciaries that in the event of a transfer to such successor
plan of the withdrawn assets, the successor plan shall be fully liable for
the payment of all transferred benefits of the Members of such Employer
(who consent to the transfer), and that the Plan shall not be liable for
the payment of any part of such benefits, (iii) has provided each Member's
written consent to the transfer and his release of all claims against the
Plan arising out of his membership therein, (iv) meets such other
requirements of the IRS, other appropriate governmental authority or of
the Board, which may apply, and (v) meets such other procedures as may be
established by the Board from time to time.
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Any withdrawal under this Section requires that a notice of withdrawal be
filed with the Thrift Plan Office. If a Member does not file such notice,
the value of his Account will be paid to him as soon as practicable after
his attainment of age 70 1/2, but in no event shall payment commence later
than April 1 of the calendar year following the calendar year in which the
Member attains age 70 1/2, except to the extent provided in Section (C)
below.
(B) (1) In lieu of any lump sum payment of his total Account, a Member who
has terminated his Employment may elect in his notice of withdrawal to
be paid in installments (no less frequently than annually), provided
that a Member shall not be permitted to elect an installment period in
excess of his remaining life expectancy (or the joint and last
survivor life expectancy of the Member and his designated beneficiary)
and if a Member attempts such an election, he shall be deemed to have
elected the installment period with the next lowest multiple within
the Member's remaining life expectancy, subject to the provisions of
Article X, Section 4. The amount of each installment will be equal to
the value of the Member's Account, multiplied by a fraction, the
numerator of which is one and the denominator of which is the number
of remaining installments including the one then being paid, so that
at the end of the installment period so elected, the total Account
will be liquidated. The value of the Units will be determined in
accordance with the Unit values on the Valuation Date on or next
following the Thrift Plan Office's receipt of his notice of withdrawal
and in accordance with the Member's installment payment election.
Payment will be made as soon as practicable after each such Valuation
Date, but in no event shall payment commence later than April 1 of the
calendar year following the calendar year in which the Member attains
age 70 1/2 subject to Paragraph (C) below. The election of
installments hereunder may not be subsequently changed by the Member,
except that upon written notice to the Thrift Plan Office, the Member
may withdraw the balance of the Units in his Account in a lump sum at
any time.
(2) ANNUITY OPTION. An Employer may, at its option, elect to provide an
annuity option in addition to the lump sum payment and installment
payment options described in Section 1(A) and Subsection (B)(1) above.
In the event an Employer elects to provide an annuity option, the
following provisions shall apply:
UNMARRIED MEMBERS: Any unmarried Member who has terminated his
Employment may elect, in lieu of any lump sum or installment payment
of his total Account(s) under Section 1(A) or Subsection (B) above,
to receive a benefit payable by purchase from an insurance company of
a single premium contract providing for (i) a single life annuity for
the life of the Member or (ii) an annuity for the life of the Member
and, if the Member dies leaving a designated Beneficiary, a 50%
survivor annuity for the life of such designated Beneficiary.
MARRIED MEMBERS: Except as otherwise provided below, (i) any married
Member who has terminated his Employment and who elected an annuity
form of payment shall receive a benefit payable by purchase from an
insurance company of a single premium contract providing for a
Qualified Joint and Survivor Annuity, as defined under Section 6(B)(1)
of Article III, unless the Member's Spouse executed a valid waiver of
the Qualified Joint and Survivor Annuity and (ii) the Surviving Spouse
of any married Member who dies prior to the date payment of his
benefit commences and who elected to receive an annuity form of
payment shall be entitled to a Preretirement Survivor Annuity, as
defined under Section 6(B)(4) of Article III, unless the Member's
spouse
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executed a valid waiver of the Preretirement Survivor Annuity.
(C) Unless the Member elects otherwise, distribution of benefits will begin no
later than the 60th day after the latest of the close of the Plan Year in
which (i) the Member attains age 65; (ii) occurs the 10th anniversary of
the year in which the Member commenced participation in the Plan; or (iii)
the Member terminates Employment with an Employer. Notwithstanding the
foregoing, the failure of a Member and, as applicable, his Spouse to
consent to a distribution while a benefit is immediately distributable
shall be deemed to be an election to defer commencement of payment of any
benefit.
Effective as of January 1, 1997, payment of a Member's Account shall not
commence later than April 1 of the calendar year following the later of
(i) the calendar year in which the Member attains age 70 1/2 or (ii) the
calendar year in which the Member retires; provided however, if the Member
is a 5 percent owner (as described in Section 416(i) of the Code), at any
time during the Plan Year ending with or within the calendar year in which
the Employee attains age 70 1/2, any benefit payable to such Member shall
commence no later than April 1 of the calendar year following the calendar
in year in which the Member attains age 70 1/2. Such benefit shall be
paid, accordance with the Regulations, over a period not extending beyond
the life expectancy of such Member (or the joint life expectancy of the
Member and his designated Beneficiary). For purposes of this Section, life
expectancy of a Member and/or a Member's spouse may at the election of the
Member be recalculated annually in accordance with the Regulations. The
election, once made, shall be irrevocable. If the Member does not make an
election prior to the time that distributions are required to commence,
then life expectancies shall not be recalculated. If a Member dies after
distribution of his interest has begun, the remaining portion of such
interest will continue to be distributed at least as rapidly as under the
method of distribution being used prior to the Member's death. In
addition, to the extent any payments from the Member's Account would be
made after the Member's death, such payments shall be made in accordance
with Section 401(a)(9) of the Code and the IRS Regulations thereunder
(including the minimum distribution incidental benefit requirements).
With respect to distributions under the Plan made on or after November 1,
2001, for calendar years beginning on or after January 1, 2001, 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 (the "2001 Proposed Regulations"),
notwithstanding any provision of the Plan to the contrary. If the total
amount of the 2001 required minimum distributions made to a Member prior
to November 1, 2001 are equal to or greater than the amount of required
minimum distributions determined under the 2001 Proposed Regulations, then
no additional distributions are required for such Member for 2001 on or
after such date. If the total amount of required minimum distributions
made to a Member prior to November 1, 2001 for 2001 are less than the
amount determined under the 2001 Proposed Regulations, then the amount of
required minimum distributions for 2001 on or after such date will be
determined so that the total amount of required minimum distributions for
2001 is the amount determined under the 2001 Proposed Regulations. This
paragraph shall continue in effect until the last calendar year beginning
before the effective date of the final regulations under Section 401(a)(9)
of the Code or such other date as may be published by the IRS.
(D) Solely to the extent required under applicable law and regulations, and
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notwithstanding any provision of the Plan to the contrary that would
otherwise limit a Distributee's election under this Subsection (D), a
Distributee may elect, at the time and in the manner prescribed by the
Board, to have any portion of an Eligible Rollover Distribution paid
directly to an Eligible Retirement Plan specified by the Distributee in a
Direct Rollover.
For purposes of this Subsection (D), the following terms shall have the
following meanings:
(1) ELIGIBLE ROLLOVER DISTRIBUTION: Solely to the extent required under
applicable law and regulations, an Eligible Rollover Distribution is
any distribution of all or any portion of the balance to the credit of
the Distributee, except that an Eligible Rollover Distribution does
not include: any distribution that is one of a series of substantially
equal periodic payments (not less frequently than annually) made for
the life (or life expectancy) of the Distributee or the joint lives
(or joint life expectancies) of the Distributee and the Distributee's
designated beneficiary, or for a specified period of ten years or
more; any distribution to the extent such distribution is required
under Section 401(a)(9) of the Code; and 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).
Effective January 1, 2002, 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 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.
Effective January 1, 2000, an Eligible Rollover Distribution excludes
hardship withdrawals as defined in Section 401(k)(2)(B)(i)(IV) of the
Code which are attributable to Member's 401(k) deferrals under
Treasury Regulation Section 1.401(k)-1(d)(2)(ii).
Effective January 1, 2002, an Eligible Rollover Distribution excludes
any hardship distributions which are made under the terms of the Plan.
(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 Section 403(a) of the Code, or a
qualified trust described in Section 401(a) of the Code, that accepts
the Distributee's Eligible Rollover Distribution. However, in the case
of an Eligible Rollover Distribution to a Surviving Spouse, an
Eligible Retirement Plan is an individual retirement account or
individual retirement annuity.
Effective January 1, 2002, an 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
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transferred into such plan from this Plan.
(3) DISTRIBUTEE: A Distributee includes an employee or former employee and
effective January 1, 2002, Distributee shall also include the Member's
Surviving Spouse. 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.
(E) Effective for distributions after December 31, 2001, and regardless of
when a Member's severance from employment occurs, a Member's elective
deferrals, and other contributions credited to the Member's 401(k)
Account, and earnings attributable to these contributions may be
distributed on account of severance from employment. However, such a
distribution shall be subject to the other provisions of the Plan
regarding distributions, other than provisions that require a separation
from service before such amounts may be distributed.
SECTION 4. ACCOUNT WITHDRAWAL UPON MEMBER'S DISABILITY.
(A) A Member who is separated from Employment by reason of a disability which
is expected to last in excess of 12 consecutive months and who is either
(i) eligible for, or is receiving, disability insurance benefits under the
Federal Social Security Act, (ii) approved for disability under the
provisions of The Comprehensive Retirement Program of the Financial
Institutions Retirement Fund (a defined benefit pension plan through which
federally insured financial institutions and organizations serving them
may cooperate in providing for the retirement of their employees), or
(iii) approved for disability under the provisions of any other benefit
program or policy maintained by his Employer, which policy or program is
applied on a uniform and nondiscriminatory basis to all Employees of such
Employer, shall be deemed to be disabled for all purposes under the Plan.
(B) The Thrift Plan Office shall determine whether a Member is disabled in
accordance with the terms of Paragraph (A) above; provided, however,
approval of Disability is conditioned upon notice to the Thrift Plan
Office of such Member's Disability by the Employer within 13 months of the
Member's separation from Employment. The notice of Disability shall
include a certification that the Member meets one or more of the criteria
listed in Paragraph (A) above.
(C) Upon an Employer's filing a written notice of Disability, a Member may
withdraw his total Account balance under the Plan (including his Rollover
Account and/or total Profit Sharing Account balance, if any) and have such
amounts paid to him in accordance with Article VII, Section 3. In lieu of
such lump sum payment, the Member may elect in his notice of withdrawal to
(i) defer receipt of some or all of his vested Account until April 1 of
the calendar year following the calendar year in which the Member attains
70 1/2, (ii) elect installment payments, as described in Section 3(B) of
this Article and Article III, Section 8(E)(2), or (iii) make periodic
withdrawals not more frequently than once per year pursuant to the
provisions of Article VII, Section 1; provided, however, if a disabled
Member becomes reemployed subsequent to withdrawal of some or all of his
Account balance, such Member may not repay to the Plan any such withdrawn
amounts.
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SECTION 5. MEMBER'S DEATH.
(A) Subject to Section 3(B)(2) above, if a married Member dies, his Spouse, as
Beneficiary, will receive a death benefit equal to the value of the
Member's Account determined on the Valuation Date on or next following the
Board's receipt of notice that such Member died; provided, however, that
if such Member's Spouse had consented in writing to the designation of a
different Beneficiary, the Member's Account will be paid to such
designated Beneficiary. Such nonspousal designation may be revoked by the
Member without spousal consent at any time prior to the Member's death. If
a Member is not married at the time of his death, his Account will be paid
to his designated Beneficiary.
(B) Subject to Section 3(B)(2) above, a Member may elect that upon his death,
his Beneficiary, pursuant to Paragraph (A) above, may receive, in lieu of
any lump sum payment, payment in 5 annual installments (10 if the Spouse
is the Beneficiary, provided that the Spouse's remaining life expectancy
is at least 10 years) whereby the value of 1/5th of such Member's Units
(or 1/10th in the case of a spousal Beneficiary, provided that the
Spouse's remaining life expectancy is at least 10 years) in each
Investment Fund will be determined in accordance with the Unit values on
the Valuation Date on or next following the Board's receipt of notice of
the Member's death and on each anniversary of such Valuation Date. Payment
will be made as soon as practicable after each Valuation Date until the
Member's Account is exhausted. Such election may be filed at any time with
the Board prior to the Member's death and may not be changed or revoked
after such Member's death. If such an election is not in effect at the
time of the Member's death, his Beneficiary (including any spousal
Beneficiary) may elect to make withdrawals in accordance with this
Article, except that any balance remaining in the deceased Member's
Account must be withdrawn on or before the December 31 of the calendar
year which contains the 5th anniversary (the 10th anniversary in the case
of a spousal Beneficiary, provided that the Spouse's remaining life
expectancy is at least 10 years) of the Member's death. Notwithstanding
the foregoing provisions of this Paragraph (B), payment of a Member's
Account shall commence not later than the December 31 of the calendar year
immediately following the calendar year in which the Member died or, in
the event such Beneficiary is the Member's Surviving Spouse, on or before
the December 31 of the calendar year in which such Member would have
attained age 70 1/2, if later (or, in either case, on any later date
prescribed by the IRS Regulations). If, upon the Spouse's or Beneficiary's
death, there is still a balance in the Account, the value of the remaining
Units will be paid in a lump sum to such Spouse's or Beneficiary's estate.
Notwithstanding anything in this Subsection (B) to the contrary, if a
Member dies after distribution of his or her interest has begun, the
remaining portion of such interest will continue to be distributed at
least as rapidly as under the method of distribution being used prior to
the Member's death. In addition, to the extent any payments from a
Member's Account would be made after a Member's death to a beneficiary
other than the Member's Spouse, such payments shall be made in accordance
with Section 401(a)(9) of the Code and the IRS Regulations thereunder. In
addition, to the extent any payments from a Member's Account would be made
after a Member's death, such payments shall be made in accordance with
Section 401(a)(9) of the Code and the IRS Regulations thereunder
(including the minimum distribution incidental benefit requirements).
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ARTICLE VIII LOAN PROGRAM
SECTION 1. GENERAL.
An Employer may, at its option, make available this loan program for any Member
(and, if applicable under Section 8 of this Article, any Beneficiary), subject
to applicable law. In the event amounts are transferred to the Plan from a
retirement plan subject to Section 401(a)(11) of the Code, no loans may be
made from a married Member's Account without the written consent of such
Member's Spouse which shall be obtained no earlier than the beginning of the
90-day period that ends on the date on which the loan is to be secured by any
portion of such Member's Account. The consent must be in writing, must
acknowledge the effect of the loan, and must be notarized. Such consent shall
thereafter be binding with respect to the consenting Spouse or any subsequent
Spouse with respect to that loan. In the event an Employer elects the loan
program under this Article VIII, loans shall be available from the Rollover
Accounts of any Employees of the Employer who have not yet become Members.
SECTION 2. LOAN APPLICATION.
(A) Subject to the restrictions described in Paragraph (B) of this Section, a
Member in Employment may borrow from his Account by filing an application
with the Thrift Plan Office. Such application (hereinafter referred to as
a "completed application") shall (i) specify the terms pursuant to which
the loan is requested to be made and (ii) provide such information and
documentation as the Board shall require, including a note, duly executed
by the Member, granting a security interest of an amount not greater than
50% of his vested Account, to secure the loan. With respect to such
Member, the completed application shall authorize the repayment of the
loan through payroll deductions. Such loan will become effective upon the
Valuation Date coinciding with or next following the date on which his
completed application and other required documents were received by the
Thrift Plan Office, subject to the same conditions with respect to the
amount to be transferred under this Section which are specified in the
Plan procedures for determining the amount of payments made under Article
VII, Section 1(A) of the Plan.
(B) The Board shall establish standards in accordance with the Code and ERISA
which shall be uniformly applicable to all Members eligible to borrow from
their interests in the Trust Fund similarly situated and shall govern the
approval or disapproval of completed applications. The terms for each loan
shall be set solely in accordance with such standards.
(C) In accordance with the Board's established standards, each completed
application shall be reviewed and approved or disapproved as soon as
practicable after the receipt thereof, and the applying Member shall be
promptly notified of such approval or disapproval. Notwithstanding the
foregoing, the review of a completed application, or payment of the
proceeds of an approved loan, may be deferred if the proceeds of the loan
would otherwise be paid during the period commencing on December 1 and
ending on the following January 31.
(D) Subject to Paragraph (C) of this Section and Paragraph (C) of Section 6 of
this Article VIII, upon approval of a completed application, payment of
the loan to the Member shall be made from the Investment Fund(s) in the
same proportion that the designated portion of the Member's Account is
invested in the Investment Funds at the time of the loan, and the relevant
portion of the Member's interest in such Investment Fund(s) shall be
cancelled and shall be transferred in cash to the
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Member. The Thrift Plan Office shall maintain sufficient records regarding
such amounts to permit an accurate crediting of repayments of the loan.
SECTION 3. PERMITTED LOAN AMOUNT.
The amount of each loan may not be less than $1,000 nor more than the maximum
amount as described below. The maximum amount available for loan under the Plan
(when added to the outstanding balance of all other loans from the Plan to the
borrowing Member) shall not exceed the lesser of: (a) $50,000 reduced by the
excess (if any) of (i) the highest outstanding loan balance attributable to the
Account of the Member requesting the loan from the Plan during the one-year
period ending on the day preceding the date of the loan, over (ii) the
outstanding balance of all other loans from the Plan to the Member on the date
of the loan, or (b) 50 percent of the value of the Member's vested Account based
on the latest available information on the date on which the Thrift Plan Office
receives the completed application for the loan and other required documents. In
determining the maximum amount that a Member may borrow, all vested assets of
his Account, will be taken into consideration, provided that, where the Employer
has not elected to make a Member's entire Account available for loans or where a
Member's Account contains investments in a self-directed brokerage account which
shall not be available for loans, in no event shall the amount of the loan
exceed the value of such vested portion of the Member's Account from which loans
are permissible.
SECTION 4. SOURCE OF FUNDS FOR LOAN
The amount of the loan will be deducted from the Member's Account in the
Investment Funds in accordance with Section 2(D) of this Article and the Plan
procedures for determining the amount of payments made under Article VII,
Section 1(A). An Employer may elect to not make loans available to Members from
a Member's Regular Account, 401(k) Account, Safe Harbor CODA Account, Profit
Sharing Account (including Profit Sharing Rollover amounts), and/or Rollover
Account from which the loan shall be allocable based upon the Member's
designation. Any portion of a Member's Account which is invested in a
self-directed brokerage account shall not be available for loans. The account
from which the Member first chooses to borrow must be exhausted before the
Member can borrow any amount from the other account. A loan will first be
allocable (to the extent the Employer permits Members to take loans from one or
more of the Members' Accounts) out of the amounts which are the least accessible
to the Member unless elected otherwise.
SECTION 5. CONDITIONS OF LOAN.
(A) Each loan to a Member under the Plan shall be repaid in level monthly
amounts through regular payroll deductions after the effective date of the
loan, and continuing thereafter with each payroll. Except as otherwise
required by the Code and the IRS Regulations, each loan shall have a
repayment period of not less than 12 months and not more than 60 months
except that, if the purpose of the loan is the purchase of a primary
residence, not more than 180 months. After the first 3 monthly payments of
the loan have been satisfied, the Member may pay the outstanding loan
balance (including accrued interest on such loan balance).
(B) The rate of interest for the term of the loan will be established as of
the loan date, and will be the Barron's Prime Rate (base rate) plus 1% as
published on the last Saturday of the preceding month, or such other rate
as may be required by applicable law and determined by reference to the
prevailing interest rate charged by commercial lenders under similar
circumstances. The applicable rate would then
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be in effect through the last business day of the month following the
month in which the rate of interest is determined.
(C) Repayment of all loans under the Plan shall be secured by 50% of the
Member's vested interest in his Account determined as of the origination
of such loan.
(D) Only one loan may be made to a Member in the Plan Year from his Account
(excluding the Member's Rollover Account), except that a second loan may
be made from the Member's Rollover Account, if any, in such Plan Year,
unless the Employer does not permit loans to be made from the Member's
Rollover Account.
(E) There shall be a reasonable origination fee and/or an annual
administration fee assessed to the Member's Account for each loan made to
a Member or Beneficiary.
SECTION 6. CREDITING OF REPAYMENT.
(A) Upon lending any amount to a Member, the Board shall establish and
maintain a loan receivable account with respect to, and for the term of,
the loan. The allocations described in this Section shall be made from the
loan receivable account.
(B) Upon receipt of each monthly installment payment and the crediting thereof
to the Member's loan receivable account, there shall be allocated to the
Member's Account in the Investment Funds in accordance with his most
recent investment instructions, the principal portion of the installment
payment plus that portion of the interest equal to the rate determined in
Section 5(B) of this Article.
(C) The unpaid balance owed by a Member on a loan under the Plan shall not
reduce the amount credited to his Account. However, from the time of
payment of the proceeds of the loan to the Member, such Account shall be
deemed invested, to the extent of such unpaid balance, in such loan until
the complete repayment thereof or distribution from such Account. Any loan
repayment shall first be deemed allocable to a Member's Regular Account
contributions, then earnings on such Member's Regular Account
contributions and finally Employer contributions plus earnings.
Notwithstanding the preceding sentence, any loan repayment of amounts
derived from a Member's 401(k) Account, Regular Account and Rollover
Account shall be applied to such accounts on a proportionate basis that
reflects the allocable portion of those Member accounts deemed invested in
the loan.
SECTION 7. CESSATION OF PAYMENTS ON LOAN.
(A) If a Member, while employed, fails to make a monthly installment payment
when due, as specified in the completed application, subject to applicable
law, he will be deemed to have received a distribution of the outstanding
balance of the loan. If such default occurs after the first 3 monthly
payments of the loan have been satisfied, the Member may pay the
outstanding balance, including accrued interest from the due date, by the
last day of the calendar quarter following the calendar quarter which
contains the due date of the last monthly installment payment that is
otherwise due and payable, in which case no such distribution will be
deemed to have occurred. Subject to applicable law, notwithstanding the
foregoing, a Member that borrows amounts from his 401(k) Account may not
cease to make monthly installment payments while employed and receiving a
Salary from the Employer.
(B) Except as otherwise provided under Section 8 below, upon a Member's
termination of Employment, death or Disability, or the termination of his
Employer's
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participation in the Plan, no further monthly installment payments may be
made. Unless the outstanding balance, including accrued interest from the
due date of the last monthly installment that is otherwise due and
payable, is paid by the last day of the calendar quarter following the
calendar quarter of the date of such occurrence, the Member will be deemed
to have received a distribution of the outstanding balance of the loan
including accrued interest from the due date. This Subsection (B) shall
also apply to a Member (i) whose Employer terminates its participation in
the Plan without establishing or maintaining a qualified successor plan
(as defined in Article VII, Section 3) to which the Member's Account could
be transferred, (ii) who elects not to transfer the total accumulated
balance of his Account to such qualified successor plan, as provided under
Article VII, Section 3(A), where the Employer has satisfied all conditions
and requirements to permit such transfer, or (iii) who fails to transfer
outstanding loan balances as provided under Article VII, Section 3(A)(2).
SECTION 8. LOANS TO FORMER MEMBERS AND BENEFICIARIES.
Notwithstanding any other provisions of this Article VIII, a Member who
terminates Employment for any reason or whose Employer terminates participation
in the Plan (a "Terminated Member") shall be permitted to continue making
scheduled repayments with respect to any loan balance outstanding at the time he
becomes a Terminated Member and any Terminated Member (or Beneficiary) shall be
permitted to borrow from his Account if his Employer (or the Employer of the
Member with respect to whom he is a Beneficiary) permitted loans under the Plan
at the time he became a Terminated Member (or became entitled to benefits as a
Beneficiary). If any individual who continues to make repayments or who borrows
from his Account pursuant to this Section 8 fails to make a monthly installment
payment by the end of the calendar quarter following the calendar quarter of the
scheduled payment date, he will be deemed to have received a distribution of the
outstanding balance of the loan (including accrued interest).
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ARTICLE IX ADMINISTRATION OF PLAN
SECTION 1. BOARD OF DIRECTORS.
(A) The general administration of the Plan and the general responsibility for
carrying out the provisions of the Plan shall be placed in a Board of
Directors who must be Members of the Plan. The President of the Plan shall
be the chief administrative officer of the Plan, a member ex officio of
the Board and, for purposes of ERISA, the "plan administrator." The Board
shall constitute the "named fiduciary" for purposes of ERISA. The Board
may adopt, and amend from time to time, by-laws not inconsistent with the
Trust and the Plan and shall have such duties and exercise such powers as
are provided in the Plan, Trust Agreement and by-laws. The number of
Directors, their method of election and their terms of office shall be
governed by such by-laws. The Board shall hold an annual meeting each year
and may hold additional meetings from time to time.
(B) The Board members shall serve without compensation, but shall be
reimbursed for any reasonable expenses incurred in their capacities as
Board members. Neither the Plan Administrator, nor any Board member,
officer or employee of the Plan shall be personally liable by virtue of
any contract or other instrument executed by him or on his behalf in such
capacity nor for any mistake of judgment made in good faith. Each
Employer, by its participation in the Plan, agrees that each member of the
Board and officer and employee of the Plan shall be indemnified by the
Employer for any liability, in excess of that which is covered by
insurance, arising put of any act or omission to act in connection with
the Plan, except for fraud or willful misconduct. The obligation to pay
any such expense shall be allocated among the Employers by the Board in
such manner as the Board deems equitable.
(C) The Board shall elect from its membership a chairman and a vice-chairman
of the Board, and shall elect such other officers of the Plan as the Board
deems desirable. The Board may appoint committees and shall arrange for
such legal, accounting, investment advisory or management, administrative
and other services as it deems appropriate to carry out the Plan, and may
act in reliance upon the advice and actions of the persons or firms
providing such services. The Board may delegate to any committee, officer,
employee or agent the authority to perform any act pertaining to the Plan
or the administration thereof. No Employer shall under any circumstances
or for any purpose be deemed an agent of the Board. The Board shall cause
to be maintained proper accounts and accounting procedures and shall
submit an Annual Report on the operations of the Plan to each Employer for
the information of its members. The Board may adopt by-laws governing the
conduct of its affairs and may amend such by-laws from time to time.
(D) The Board shall have the exclusive right to interpret the Plan and to
determine any question arising under or in connection with the
administration of the Plan. Its decision or action in respect thereof
shall be conclusive and binding upon all persons having an interest in the
Trust or under the Plan. The Board shall have no duty to see that
contributions received by the Trustee under the Plan comply with the
provisions of the Plan, nor any duty to enforce payment of any
contributions under the Plan.
(E) (1) All claims for benefits under the Plan shall be submitted in writing
to, and within a reasonable period of time decided by, the President
of the Plan. If the claim is wholly or partially denied, written
notice of the denial shall be furnished within 90 days after receipt
of the claim; provided that, if special
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circumstances require an extension of time for processing the claim,
an additional 90 days from the end of the initial period shall be
allowed for processing the claim, in which event the claimant shall be
furnished with a written notice of the extension prior to the
termination of the initial 90-day period indicating the special
circumstances requiring an extension. The written notice denying the
claim shall set forth the reasons for the denial, including specific
reference to pertinent provisions of the Plan on which the denial is
based, a description of any additional information necessary to
perfect the claim and information regarding review of the claim and
its denial.
(2) A claimant may review all pertinent documents and may request a review
by the Board, at the office of the Plan, of a decision denying the
claim. Such a request shall be made in writing and filed with the
Board within 60 days after delivery to the claimant of written notice
of the decision. Such written request for review shall contain all
additional information which the claimant wishes the Board to
consider. The Board may hold a hearing or conduct an independent
investigation, and the decision on review shall be made as soon as
possible after the Board's receipt of the request for review. Written
notice of the decision on review shall be furnished to the claimant
within 60 days after receipt by the Board of a request for review,
unless special circumstances require an extension of time for
processing, in which event an additional 60 days shall be allowed for
review and the claimant shall be so notified in writing. Written
notice of the decision on review shall include specific reasons for
the decision. For all purposes under the Plan, such decision on claims
(where no review is requested) and decision on review (where review is
requested) shall be final, binding and conclusive on all interested
persons as to participation and benefits eligibility, the amount of
benefits and as to any other matter of fact or interpretation relating
to the Plan.
SECTION 2. TRUST AGREEMENT.
(A) The Board shall enter into one or more Trust Agreements with a Trustee or
Trustees selected by the Board. The Trust established under any such
agreement shall be a part of the Plan and shall provide that all funds
received by the Trustee as contributions under the Plan and the income
therefrom (other than such part as is necessary to pay the expenses and
charges referred to in Paragraph (B) of this Section) shall be held in the
Trust Fund for the exclusive benefit of the Members or their
Beneficiaries, and managed, invested and reinvested and distributed by the
Trustee in accordance with the Plan. Sums received for investment may be
invested (i) wholly or partly through the medium of any common, collective
or commingled trust fund maintained by a bank or other financial
institution and which is qualified under Sections 401(a) and 501(a) of
the Code and constitutes a part of the Plan, or (ii) wholly or partly
through the medium of a group annuity or other type of contract issued by
an insurance company and constituting a part of the Plan, and utilizing,
under any such contract, general, commingled or individual investment
accounts. Subject to the provisions of Article XII, the Board may from
time to time and without the consent of any Employer, Member or
Beneficiary (a) amend the Trust Agreement or any such insurance contract
in such manner as the Board may deem necessary or desirable to carry out
the Plan, (b) remove the Trustee and designate a successor Trustee upon
such removal or upon the resignation of the Trustee, and (c) provide for
an alternate funding agency under the Plan. The Trustee shall make
payments under the Plan only to the extent, in the amounts, in the manner,
at the time, and to the persons as shall from time to time be set forth
and designated in written authorizations from the Board.
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(B) The Trustee shall from time to time charge against and pay out of the
Trust Fund taxes of any and all kinds whatsoever which are levied or
assessed upon or become payable in respect of such Fund, the income or any
property forming a part thereof, or any security transaction pertaining
thereto. To the extent not paid by the Employers, the Trustee shall also
charge against and pay out of the Trust Fund other expenses incurred by
the Trustee in the performance of its duties under the Trust, the expenses
incurred by the Board in the performance of its duties under the Plan
(including reasonable compensation for agents and cost of services
rendered in respect of the Plan), such compensation of the Trustee as may
be agreed upon from time to time between the Board and the Trustee, and
all other proper charges and disbursements of the Trustee or the Board.
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ARTICLE X MISCELLANEOUS PROVISIONS
SECTION 1. GENERAL LIMITATIONS.
(A) In order that the Plan be maintained as a qualified plan and trust under
the Code, contributions in respect of a Member shall be subject to the
limitations set forth in this Section, notwithstanding any other provision
of the Plan. The contributions in respect of a Member to which this
Section is applicable are his own contributions and his Employer's
contributions.
For purposes of this Section 1, a Member's contributions shall be
determined without regard to any rollover contributions (as defined by
Section 401(a)(5) of the Code).
(B) Annual additions to a Member's Account (including his 401(k) and Regular
Accounts and his Profit Sharing Account) and to any other defined
contribution plan maintained by the Member's Employer in respect of any
Plan Year may not exceed the limitations set forth in Section 415 of the
Code, which are incorporated by reference. For these purposes, "annual
additions" shall have the meaning set forth in Section 415(c)(2) of the
Code, as modified elsewhere in the Code and the Regulations, and the
limitation year shall mean the Plan Year unless any other
twelve-consecutive-month period is designated pursuant to a written
resolution adopted by the Employer and approved by the Board.
Effective for limitation years beginning after December 31, 2001, except
to the extent permitted under Article III, Section 9 of the Plan and
Section 414(v) of the Code, if applicable, the annual additions that may
be contributed or allocated to a Member's Account under the Plan for any
limitation year shall not exceed the lesser of:
(i) $40,000, as adjusted for increases in the cost-of-living
under Section 415(d) of the Code, or
(ii) 100 percent of the Member's compensation, within the meaning
of Section 415(c)(3) of the Code, for the limitation year.
Effective for limitation years beginning after December 31, 1999, the
combined plan limit as provided in Section 415(e) of the Code (as in
effect prior to the Small Business Job Protection Act of 1996) is
eliminated.
(C) In the event that, due to forfeitures, reasonable error in estimating a
Member's compensation, or other limited facts and circumstances, total
contributions to a Member's Account are found to exceed the limitations of
this Section, the Board shall cause contributions made under Article III,
Section 1 in excess of such limitations to be refunded to the affected
Member, with earnings thereon, and shall take appropriate steps to reduce,
if necessary, the Employer contributions made with respect to those
returned contributions. Such refunds shall not be deemed to be
withdrawals, loans, or distributions from the Plan. If a Member's annual
contributions exceed the limitations contained in Paragraph (B) of this
Section after the Member's Article III, Section 1 contributions, with
earnings thereon, if any, have been refunded to such Member, the Profit
Sharing contribution to be allocated to any Member in respect of any
Contribution Determination Period (including allocations as provided in
this Paragraph) shall instead be allocated to or for the benefit of all
other Members who are Employees in Employment as of the last day
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of the Contribution Determination Period as determined under Article III,
Section 8(C) and allocated in the same proportion that each such Member's
Salary for such Contribution Determination Period bears to the total
Salary for such Contribution Determination Period of all such Members or,
the Board may, at the election of the Employer, utilize such excess to
reduce the contributions which would otherwise be made for the succeeding
Contribution Determination Period by the Employer. If, with respect to any
Contribution Determination Period, there is an excess Profit Sharing
contribution, and such excess cannot be fully allocated in accordance with
the preceding sentence because of the limitations prescribed in Paragraph
(B) of this Section, the amount of such excess which cannot be so
allocated shall be allocated to the Employer Hold Account and made
available to the Employer pursuant to the terms of Article VI, Section
2(B)(2) except that any such excess contribution may not be applied to
reduce administrative expenses (in accordance with Article IX, Section 2).
The Board, in accordance with Paragraph (D) of this Section, shall take
whatever additional action may be necessary to assure that contributions
to Members' Accounts meet the requirements of this Section.
(D) In addition to the steps set forth in Paragraph (C) above, the Board may
from time to time adjust or modify the maximum limitations applicable to
contributions made in respect of a Member under this Section 1 as may be
required or permitted by the Code or ERISA prior to or following the date
that allocation of any such contributions commence and shall take
appropriate action to real locate the annual contributions which would
otherwise have been made but for the application of this Section.
(E) Membership in the Plan shall not give any Employee the right to be
retained in the Employment of his Employer and shall not affect the right
of the Employer to discharge any Employee.
(F) Each Member, Spouse and Beneficiary assumes all risk in connection with
any decrease in the market value of the assets of the Trust Fund. Neither
the Board nor the Trustee guarantees that upon withdrawal the value of a
Member's Account, his Profit Sharing Account, and/or his Rollover Account
will be equal to or greater than the amount of the Member's own deferrals
or contributions, or those credited on his behalf in which the Member has
a vested interest, under the Plan.
(G) The establishment, maintenance or crediting of a Member's Account pursuant
to the Plan shall not vest in such Member any right, title or interest in
the Trust Fund except at the times and upon the terms and conditions and
to the extent expressly set forth in the Plan and the Trust Agreement.
(H) The Trust Fund shall be the sole source of payments under the Plan and the
Employer and the Board assume no liability or responsibility for such
payments, and each Member, Spouse or Beneficiary who shall claim the right
to any payment under the Plan shall be entitled to look only to the Trust
Fund for such payment. All contributions to the Trust Fund shall be deemed
to have been made in the State of New York.
SECTION 2. TOP HEAVY PROVISIONS.
In respect of any Employer, the Plan will be considered a Top Heavy Plan for any
Plan Year if it is determined to be a Top Heavy Plan as of the last day of the
preceding Plan Year. The provisions of this Section 2 shall apply and supersede
all other provisions in the Plan during each Plan Year with respect to which the
Plan, with regard to such Employer,
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is determined to be a Top Heavy Plan.
(A) For purposes of this Section 2, the following terms shall have the
meanings set forth below:
(1) "AFFILIATE" shall mean any entity affiliated with any Employer
within the meaning of Section 414(b), 414(c) or 414(m) of the Code,
or pursuant to the IRS Regulations under Section 414(o) of the Code,
except that for purposes of applying the provisions hereof with
respect to the limitation on contributions, Section 415(h) of the
Code shall apply.
(2) "AGGREGATION GROUP" shall mean the group composed of each qualified
retirement plan of the Employer or an Affiliate in which a Key
Employee is a member and each other qualified retirement plan of the
Employer or an Affiliate which enables a plan of the Employer or an
Affiliate in which a Key Employee is a member to satisfy Sections
401(a)(4) or 410 of the Code. In addition, the Board may choose to
treat any other qualified retirement plan as a member of the
Aggregation Group if such Aggregation Group will continue to satisfy
Sections 401(a)(4) and 410 of the Code with such plan being taken
into account.
(3) "KEY EMPLOYEE" shall mean a "Key Employee" as defined in Sections
416(i)(1) and (5) of the Code and the IRS Regulations. For purposes
of Section 416 of the Code and for purposes of determining who is a
Key Employee, an Employer which is not a corporation may have
"officers" only for Plan Years beginning after December 31, 1985.
For purposes of determining who is a Key Employee pursuant to this
Subparagraph (3), compensation shall have the meaning prescribed in
Section 414(s) of the Code, or to the extent required by the Code or
the IRS Regulations, Section 1.415-2(d) of the IRS Regulations.
(4) "NON-KEY EMPLOYEE" shall mean a "Non-Key Employee" as defined in
Section 416(i)(2) of the Code and the IRS Regulations thereunder.
(5) "TOP HEAVY PLAN" shall mean a "Top Heavy Plan" as defined in Section
416(g) of the Code and the IRS Regulations thereunder.
(6) "DETERMINATION DATE" shall mean the last day of the preceding Plan
Year or, in the case of the first Plan Year, the last day of such
Plan Year.
(7) "TOP HEAVY RATIO" - is a fraction, the numerator of which is the sum
of the account balances of all Key Employees as of the applicable
Determination Date (including any part of any account balance
distributed in the five year period ending on the Determination
Date), and the denominator of which is the sum of all account
balances (including any part of any account balance distributed in
the five year period ending on the Determination Date), both
computed in accordance with Section 416 of the Code and the IRS
Regulations thereunder.
(B) Subject to the provisions of Paragraph (D) below, for each Plan Year that
the Plan is a Top Heavy Plan, the Employer's contribution allocable to
each Employee (other than a Key Employee) who has satisfied the
eligibility requirement(s) of Article II, Section 2, and who is in service
at the end of the Plan Year shall not be less than the lesser of (i) 3% of
such eligible Employee's compensation (as defined in Section 414(s) of the
Code or to the extent required by the Code or the IRS Regulations, Section
1.415-2(d) of the Regulations), provided that for any Plan Year beginning
on or after January 1, 1994 no more than $150,000 (adjusted for cost of
living to
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the extent permitted by the Code and the IRS Regulations) shall be taken
into account), or (ii) the percentage at which Employer contributions for
such Plan Year are made and allocated on behalf of the Key Employee for
whom such percentage is the highest. For the purpose of determining the
appropriate percentage under clause (ii), all defined contribution plans
required to be included in an Aggregation Group shall be treated as one
plan. Clause (ii) shall not apply if the Plan is required to be included
in an Aggregation Group which enables a defined benefit plan also required
to be included in said Aggregation Group to satisfy Sections 401(a)(4) or
410 of the Code. Contributions attributable to salary reduction that are
made to a Key Employee's 401(k) Account shall be taken into account in
determining the minimum required contribution under this Subsection (B).
(C) If the Plan is a Top Heavy Plan for any Plan Year, and (i) the Employer
has elected a vesting schedule under Article VI for an employer
contribution type which does not satisfy the minimum Top Heavy vesting
requirements or (ii) if the Employer has not elected a vesting schedule
for an employer contribution type, the vested interest of each Member, who
is credited with at least one Hour of Employment on or after the Plan
becomes a Top Heavy Plan, for each employer contribution type in his
Account described in clause (i) or (ii) above, shall not be less than the
percentage determined in accordance with the following schedule:
Completed Vested
Years of Employment Percentage
- ------------------- ------------
Less than 2 0%
2 but less than 3 20%
3 but less than 4 40%
4 but less than 5 60%
5 but less that 6 80%
6 or more 100%
Notwithstanding the schedule provided above, if the Plan is a Top Heavy
Plan, for any Plan Year and if an Employer has elected a cliff vesting
schedule for an employer contribution type described in clause (i) or (ii)
above, the vested interest of each Member, who is credited with at least
one Hour of Employment on or after the Plan becomes a Top Heavy Plan, for
such employer contribution type in his Account, shall not be less than the
percentage determined in accordance with the following schedule:
Completed Vested
Years of Employment Percentage
- ------------------- -----------
Less than 3 0%
3 or more 100%
(D) The Board shall, to the maximum extent permitted by the Code and in
accordance with the IRS Regulations, apply the provisions of this Section
2 by taking into account the benefits payable and the contributions made
under the Financial Institutions Retirement Fund or any other qualified
plan maintained by an Employer, to prevent inappropriate omissions or
required duplication of minimum contributions.
(E) Effective for Plan Years beginning after December 31, 2001, for purposes
of
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determining whether the Plan is a top-heavy plan under Section 416(g) of
the Code, and whether the Plan satisfies the minimum benefits requirements
of Section 416(c) of the Code for such years, the following provisions
shall apply:
(1) "Key Employee" shall mean any Employee or former Employee (including
any deceased employee) who at any time during the Plan Year that includes
the determination date was an officer of the Employer having annual
compensation greater than $130,000 (as adjusted under 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 $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.
(2) The present value of accrued benefits and the amounts of account
balances of an Employee as of the determination date shall be increased by
the distributions made with respect to the Employee under the plan and any
plan aggregated with the Plan under Section 416(g)(2) of the Code during
the 1-year period ending on the determination date. The preceding sentence
shall also apply to distributions under a terminated Plan which, had it
not been terminated, would have been aggregated with the Plan under
Section 416(g)(2)(A)(i) of the Code. In the case of a distribution made
for a reason other than separation from service, death, or disability,
this provision shall be applied by substituting "5-year period" for
"1-year period."
The accrued benefits accounts 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.
(3) Employer matching contributions shall be taken into account for
purposes of satisfying the minimum contribution requirements of Section
416(c)(2) of the Code and the plan. The preceding sentence shall apply
with respect to matching contributions under the Plan, or any other plan
maintained by the Employer, to the maximum extent permitted by the Code
and in accordance with the IRS Regulations. Employer matching
contributions that are used to satisfy the minimum contribution
requirements shall be treated as matching contributions for purposes of
the actual contribution percentage test and other requirements of Section
401(m) of the Code.
The Employer may elect to provide that the minimum benefit requirement
shall be met in another plan (including another plan that consists solely
of a cash or deferred arrangement which meets the requirements of Section
401(k)(12) of the Code and matching contributions with respect to which
the requirements of Section 401(m)(11) of the Code are met).
(4) For purposes of determining minimum contributions under this Section
2, no more than $200,000 (adjusted for cost of living to the extent
permitted by the Code and Regulations) shall be taken into account.
SECTION 3. INFORMATION AND COMMUNICATIONS.
Each Employer, Member, Spouse and Beneficiary shall be required to furnish the
Board
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with such information and data as may be considered necessary by the Board. All
notices, instructions and other communications with respect to the Plan shall be
in such form as is prescribed from time to time by the Board, shall be mailed by
first class mail or delivered personally, and shall be deemed to have been duly
given and delivered only upon actual receipt thereof by the Board. All
information and data submitted by an Employer or a Member, including a Member's
birth date, marital status, salary and circumstances of his employment and
termination thereof, may be accepted and relied upon by the Board. All
communications from the Board or the Trustee to an Employer, Member, Spouse or
Beneficiary shall be deemed to have been duly given if mailed by first class
mail to the address of such person as last shown on the records of the Plan.
SECTION 4. SMALL ACCOUNT BALANCES.
Notwithstanding the foregoing provisions of the Plan, and except as provided in
Article III, Section 6(B)(6), if the value of all of a Member's Account under
the Plan (including a Profit Sharing Account and a Rollover Account, if any),
when aggregated is equal to or exceeds $500, then no Account will be distributed
without the consent of the Member prior to age 65 (at the earliest).
SECTION 5. AMOUNTS PAYABLE TO INCOMPETENTS, MINORS OR ESTATES.
If the Board shall find that any person to whom any amount is payable under the
Plan is unable to care for his affairs because of illness or accident, or is a
minor, or has died, then any payment due him or his estate (unless a prior claim
therefor has been made by a duly appointed legal representative) may be paid to
his Spouse, relative or any other person deemed by the Board to be a proper
recipient on behalf of such person otherwise entitled to payment. Any such
payment shall be a complete discharge of the liability of the Trust Fund
therefor.
SECTION 6. NON-ALIENATION OF AMOUNTS PAYABLE.
Except insofar as may otherwise be required by applicable law, or Article VIII,
or pursuant to the terms of a Qualified Domestic Relations Order, no amount
payable under the Plan shall be subject in any manner to alienation by
anticipation, sale, transfer, assignment, bankruptcy, pledge, attachment, charge
or encumbrance of any kind, and any attempt to so alienate shall be void; nor
shall the Trust Fund in any manner be liable for or subject to the debts or
liabilities of any person entitled to any such amount payable; and further, if
for any reason any amount payable under the Plan would not devolve upon such
person entitled thereto, then the Board, in its discretion, may terminate his
interest and hold or apply such amount for the benefit of such person or his
dependents as it may deem proper. For the purposes of the Plan, a "Qualified
Domestic Relations Order" means any judgment, decree or order (including
approval of a property settlement agreement) which has been determined by the
Board in accordance with procedures established under the Plan, to constitute a
Qualified Domestic Relations Order within the meaning of Section 414(p)(1) of
the Code. No amounts may be withdrawn under Article VII and Article III, Section
8, and no loans granted under Article VIII, if the Thrift Plan Office has
received a document which may be determined following its receipt to be a
Qualified Domestic Relations Order prior to completion of review of such order
by the Office within the time period prescribed for such review by the IRS
Regulations.
SECTION 7. UNCLAIMED AMOUNTS PAYABLE.
If the Board cannot ascertain the whereabouts of any person to whom an amount is
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payable under the Plan, and if, after 5 years from the date such payment is due,
a notice of such payment due is mailed to the address of such person, as last
shown on the records of the Plan, and within 3 months after such mailing such
person has not filed with the Board written claim therefor, the Board may direct
in accordance with ERISA that the payment (including the amount allocable to the
Member's contributions) be cancelled, and used in abatement of the Plan's
administrative expenses, provided that appropriate provision is made for
recrediting the payment if such person subsequently makes a claim therefor.
SECTION 8. LEAVES OF ABSENCE.
(A) Contribution allocations and vesting service continue to the extent
provided in Paragraphs (B)(1), (2), (3) or (4), below, during any approved
Leave of Absence, provided that the Employer notifies the Plan of its
intention to grant to a specific Employee or Member, pursuant to the
Employer's policy which is uniformly applicable to all its Employees under
similar circumstances, one of the Leaves of Absence described in Paragraph
(B) below, and agrees to notify the Plan at the conclusion of such leave.
(B) For purposes of the Plan there are only four types of approved Leaves of
Absence:
(1) Non-military leave granted to a Member for a period not in excess of
one year during which service is recognized for vesting purposes and
the Member is entitled to share in any supplemental contributions
under Article III, Section 3 or forfeitures under Article VI,
Section 2, if any, on a pro-rata basis, determined by the Salary
earned during the Plan Year or Contribution Determination Period; or
(2) Non-military leave or layoff granted to a Member for a period not in
excess of one year during which service is recognized for vesting
purposes, but the Member is not entitled to share in any
contributions or forfeitures as defined under (1) above, if any,
during the period of the leave; or
(3) To the extent not otherwise required by applicable law, military or
other governmental service leave granted to a Member from which he
returns directly to the service of the Employer. Under this leave, a
Member may not share in any contributions or forfeitures as defined
under (1) above, if any, during the period of the leave, but vesting
service will continue to accrue; or
(4) To the extent not otherwise required by applicable law, a military
leave granted at the option of the Employer to a Member who is
subject to military service pursuant to an involuntary call-up in
the Reserves of the U.S. Armed Services from which he returns to the
service of the Employer within 90 days of his discharge from such
military service. Under this leave, a Member is entitled to share in
any contributions or forfeitures as defined under (1) above, if any,
and vesting service will continue to accrue. Notwithstanding any
provision of the Plan to the contrary, if a Member has one or more
loans outstanding at the time of this leave, repayments on such
loan(s) may be suspended, if the Member so elects, until such time
as the Member returns to the service of the Employer or the end of
the leave, if earlier.
The determination of who is a Highly Compensated Employee will be
made in accordance with Section 414(q) of the Code and the IRS
Regulations
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thereunder.
(C) Notwithstanding any provision of this Plan to the contrary, effective
December 12, 1994, contribution allocations and vesting service with
respect to qualified military service will be provided in accordance with
Section 414(u) of the Code. Loan repayments will be suspended under this
Plan as permitted under Section 414(u)(4) of the Code during such period
of qualified military service.
SECTION 9. RETURN OF CONTRIBUTIONS TO EMPLOYER.
(A) In the case of a contribution that is made by an Employer by reason of a
mistake of fact, such Employer may request the return to it of such
contribution within one year after the payment of the contribution,
provided such refund is made within one year after the payment of the
contribution.
(B) In the case of a contribution made by an Employer or a contribution
otherwise deemed to be an Employer contribution under the Code, such
contribution shall be conditioned upon the deductibility of the
contribution by the Employer under Section 404 of the Code. To the extent
the deduction for such contribution is disallowed, in accordance with IRS
Regulations, the Employer may request the return to it of such
contribution within one year after the disallowance of the deduction.
SECTION 10. CONTROLLING LAW.
The Plan and all rights thereunder shall be governed by and construed in
accordance with the laws of the State of New York (without regard to the
principles of the conflicts of laws thereof) and ERISA.
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ARTICLE XI TERMINATION OF EMPLOYER PARTICIPATION
SECTION 1. TERMINATION BY EMPLOYER.
Any Employer may terminate its participation in the Plan by giving the Board
written notice specifying a termination date which shall be a Valuation Date at
least 60 days subsequent to the date such notice is received by the Board.
SECTION 2. TERMINATION BY BOARD.
The Board may terminate any Employer's participation, as of a termination date
specified by the Board, if the Board determines that the Employer has failed to
make proper contributions or to comply with any other provision of the Plan or
any applicable rulings or Regulations under the Code, within 15 days after
notice and demand by the Board. Except as provided under Article III, Section 3,
upon complete discontinuance of an Employer's contributions, its participation
shall automatically terminate, and its termination date shall be a Valuation
Date specified by the Board which is within 3 months subsequent to the last day
through which the Employer's contributions to the Trust Fund were paid.
SECTION 3. TERMINATION DISTRIBUTION.
If an Employer's participation is terminated, the Board shall promptly notify
the IRS and such other appropriate governmental authority as applicable law may
require. Neither the Employer not its Employees shall make any further
contributions under the Plan after the termination date, except that the
Employer shall remit to the Board an amount equal to the product of (i) $60
multiplied by (ii) the number of the Employer's Members and Employees with a
balance in their Accounts as of the termination date, to defray the cost of
implementing its termination, or such other amount as determined by the Board.
Except as Article III, Section 4 may provide, each Employee may thereafter
withdraw the current value of his Accounts in accordance with Article VII.
Subject to the provisions of Article XII, Paragraph (D), an Employer whose
participation has been terminated pursuant to this Article may transfer assets
under its prior Plan to a qualified successor plan, provided such plan satisfies
the requirements contained in Article VII, Section 3 and the transfer is
otherwise in accordance with the procedures of such Section.
Upon the termination of participation under the Plan of an Employee's or
Member's Employer, any rights of the Employee or Member to make contributions,
rollovers or transfers to the Plan shall cease.
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ARTICLE XII AMENDMENT OR TERMINATION OF THE PLAN AND TRUST
(A) The Board shall have the right to amend or terminate the Plan or Trust
Agreement at any time in whole or in part, for any reason, and without the
consent of any Employer, Member or Beneficiary, and each Employer by its
adoption of the Plan and Trust shall be deemed to have delegated this
authority to the Board. No amendment, however, shall impair such rights of
payment as the Member or his Beneficiary would have had, if such amendment
had not been made, with respect to contributions made by him or on his
behalf prior to such amendment, except to the extent that such amendment
is, in the opinion of the Board, necessary or desirable to qualify or
maintain the Plan and the Trust as a plan and trust meeting the
requirements of Sections 401 (a) and 501 (a) of the Code as now in effect
or hereafter amended, or any other applicable section of the Code now or
hereafter in force from time to time; and no amendment shall make it
possible for any part of the Trust Fund (other than such part as may be
necessary to pay the expenses and charges referred to in Article IX) to be
used for purposes other than for the exclusive benefit of Members or their
Beneficiaries.
(B) In the event of termination of the Plan by the Board or upon a complete
discontinuance of contributions under the Plan, the Units credited to each
Member's Account as of the date of such termination or complete
discontinuance of contributions shall be fully vested in the Member, and
the Trustee shall upon direction of the Board liquidate the assets of the
Trust Fund with such promptness as the Trustee deems prudent. When such
liquidation has been completed and after provision for all expenses and
charges referred to in Article IX, and proportionate adjustment of all
Plan Accounts to reflect such expenses, the Trustee shall pay to each
person who was a Member on such termination date (or in the event of his
death on or after such date, to his Spouse or Beneficiary) a lump sum
equal to the amount, if any, then credited to his Account after such
liquidation and provision for expenses and charges.
(C) Notwithstanding any termination of the Plan by the Board, the Board shall
remain in existence and all the provisions of the Plan shall remain in
force which are necessary for the execution of the Plan and the
distribution of the Trust Fund assets in accordance with this Article.
(D) No assets of the Plan shall in any event be merged, consolidated with, or
transferred to any other plan unless each Member affected thereby would,
if such plan then terminated immediately after such event, receive
thereunder a benefit which is equal to or greater than the benefit to
which he would have been entitled if the Plan had terminated immediately
before such event.
(E) In the event that any governmental authority or the Board determines that
a partial termination (within the meaning of ERISA) of the Plan has
occurred as to any Employer, then the Account of each Member who is
affected thereby shall be fully vested in such Member and the provisions
of Article XI and this Article XII, which in the opinion of the Board are
necessary for the execution of the Plan and the allocation and
distribution of assets of the Plan, shall apply.
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TRUSTS ESTABLISHED UNDER THE PLAN
Assets of the Plan are held in trust under Trust Agreements with The Bank
of New York, pursuant to Article IX, Section 2 of the Plan. Any Employer or
Member may obtain a copy of these Trust Agreements from the office of the Plan.
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